Rea v. Chambers

California Court of Appeal Nov 1, 1933 No. Docket No. 9021.Published

Before: Sturtevant

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Holding. The court held that the trial court did not err in finding the lessees failed to prosecute drilling operations with reasonable diligence, thereby justifying the forfeiture of the lease after the lessees failed to cure the default within the sixty-day notice period.

Issues

Whether the lessees failed to prosecute drilling operations with reasonable diligence as required by the lease.
Whether the trial court erred in refusing to allow the defendants to file an amended answer regarding work performed after the commencement of the action.

Disposition. affirmed

Quotations verified verbatim against the opinion

“The fact that the tube of the boiler burst, standing alone without additional evidence, cannot be said as a matter of law to excuse all performance from December 1 to January 10, 1932”

“The plaintiffs’ complaint rested solely on want of diligence prior to the commencement of the action.”

STURTEVANT, J.

— From a judgment declaring the rights of the lessees forfeited the defendants have appealed.

Some time prior to May 31, 1929, there had been sunk an uncompleted oil test well on the property owned by the plaintiffs. That well was down 2,000 feet. On the date mentioned the plaintiffs as lessors and the defendants as lessees entered into a contract for the drilling of a test well. Some time in July, 1929, the defendants commenced the drilling. In March, 1931, the drilling stopped. At that time the well had been sunk to the depth of 2,065 feet. No further work having been done, on the tenth day of November, 1931, pursuant to a clause contained in the lease, the plaintiffs gave notice to the defendants of their default. On November 30th the defendants entered the premises and made some repairs to their apparatus and machinery. The next day, December 1st, they drilled about two feet and stopped. The cause of the stopping was the fact that one of the tubes in the boiler blew out. As to what length of time it would require to repair the boiler and resume work there is no direct evidence in the record. At the time the boiler trouble arose the well was down 2,067 feet. No other work was done prior to March 17, 1932, and on that date this action was commenced.

Among the numerous covenants contained in the lease are the following: “The lessee shall within one month from date hereof commence or cause to be commenced operations for the drilling of a test .well . . . and shall prosecute the drilling of same

with reasonable diligence

until a well is completed ... or unless mechanical difficulties are encountered ... In the event that the lessee fails to perform any obligation or obligations or terms or conditions of this lease

[753]

by the lessee to be kept and performed, and such failure shall continue for a period of sixty days from and after written notice thereof specifying the nature of such breach or default is given by the lessor to the lessee, then this lease shall forthwith cease and determine and all rights of the lessee in and to the demised premises shall be at an end; and the lessee shall vacate said premises and the lessor may reenter and take possession of the same . . . Drilling operations as used in this lease is defined to mean placing of material upon premises for the construction of a derrick and other necessary structures for the drilling of an oil well followed

Rea v. Chambers

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STURTEVANT, J.

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