Appeal, No. 182, March T., 1962, from decree of Court of Common Pleas of Washington County, No. 5494 in equity, in case of H. H. White v. Charles E. Young. Decree affirmed.
David M. Harrison, with him Francis A. Barry, Edward S. Martin, and Harrison & Louik, for appellant.
Adolph L. Zeman, with him Robert L. Zeman, and Zeman & Zeman, for appellee.
Before Bell, C.j., Musmanno, Jones, Cohen, Eagen, O'brien and Keim, JJ.
OPINION BY MR. JUSTICE COHEN
On September 3, 1945, White, the appellee (lessor), leased an eighty-four acre tract of land to Young, the appellant (lessee), for the purpose of drilling and operating for petroleum, oil and gas. The lease was for a term of ten years, "and as much longer as [oil] or [gas] is found in paying quantities, or the hereinafter described rental is paid." As is customary with this type of lease, rental was to be based upon a fractional division of the amount of oil and gas produced, with the lessor to receive a one-eighth royalty from such oil and gas. Since the tract in question was farmland, the agreement provided that wells were to be located in such a manner as to least interfere with lessor's farming activities.
Lessee drilled a well on the premises which produced oil in paying quantities until June 1, 1955. At that time operations ceased and have not subsequently resumed. No royalties have been paid since June 28, 1955. In January, 1956, lessee removed the motor from the pump on the well and in September, 1957 lessee pulled the rods from the pump.
The tract is in demand for the erection of dwelling houses but because of the existence of the oil lease the lessor has been hampered in his attempts to sell parcels of land within the tract. After notifying the lessee in writing that the lease had been terminated, the lessor brought a complaint in equity predicated upon the theory that the lease had expired, by its terms, since no royalties had been paid for over three years and no oil had been found "in paying quantities". Lessor also contended in the alternative that the lessee had abandoned his leasehold interest. He prayed the court to decree that the lease be declared terminated; that the lessee be required to execute and deliver a surrender of the lease; and that the lessee be required to remove from the leased premises the remaining equipment and to plug the well. The lessor alleged that the presence of the equipment connected with the well, consisting of a tank, pump, jack, rods, pipes, etc., interfered with the lessor's use of the land for agricultural purposes.
Lessee filed preliminary objections stating that lessor had a complete and adequate remedy at law under Pa. R.C.P. 1061 and that equity was therefore without jurisdiction under the facts alleged. The lower court dismissed the preliminary objections whereupon the lessee appealed under the Act of March 5, 1925, P.L. 23, 12 P.S. § 672 et seq. On allocatur to this Court from the Superior Court we dismissed the appeal because it did not raise at that time an appealable question under the aforesaid act. White v. Young,
Pa. 61, 166 A.2d 663 (1960). Thereafter the case was tried and the court below held that the lessor was entitled to the relief ...