Clear Creek Oil & Gas Co. v. Ft. Smith Spelter Co.
Opinion of the Court
Plaintiff in error (called Gas Company) filed its petition against the Spelter Company, the Zinc Company, and the Athletic Company, praying specific performance of a contract and damages for past violations thereof. After overruling motion attacking’ the jurisdiction of the court as a court of equity, the court heard the evidence, and being then of the opinion that “the court as a court of equity is without jurisdiction of this cause, that the issue is solely an issue of fact, that the jurisdiction thereof is at law, and that this cause should be transferred to the law docket,” made the order of transfer, allowing the Gas Company its exception. Thereafter, the case was tried to a jury. During the trial a settlement was made with the Athletic Company, and no recovery thereafter sought against it. From judgment on a verdict directed for the Spelter and Zinc Companies, the Gas Company has prosecuted this writ of error.
The contentions here urged by the Gas Company, as stated in the brief, are:
1. The complaint states a good cause of action for specific perform-3¡ílC€.
2. The plaintiff’s remedy at law. is inadequate, and a bill in equity is proper.
3. The complaint alleges a good cause of action based on an equitable estoppel, and the court should have given the relief, or, after it was transferred to the law docket, submitted the facts to the jury.
The Gas Company treats the first two points together as being related, and contends that it was entitled to a decree of specific performance. To understand this contention it is necessary to have in mind the following allegations made by it: It contended that it had separate agreements with the Spelter and Zinc Companies to furnish them with certain quantities of natural gas at 4 cents per 1,000 c. f., and giving them in the above order priority over other customers, and that it was obligated to make reasonable exploitations and explorations to assure the required quantities of gas; that its supply materially diminished, and controversies arose as to its duty to make further search for gas; that a suit was brought by other users to prevent cutting off of their supplies to comply with the claimed priority rights of the above companies; that before trial of the above suit, gas was discovered in large quantities by another driller on property near its leases, and the Gas Company at once commenced drilling a well near this new well, resulting' in obtaining a good supply of gas and in proving that the new field was a valuable gas producer; that in this new field was an unleased tract of 160 acres belonging to Cazort, which was valuable for gas development; that during the trial of the above suit, a conference was held, the representatives of all parties except the Zinc Company being present ; that it was then agreed that the Gas Company would contract for Cazort to drill three wells, it would drill four, and all parties would pay for gas furnished at 8 cents per 1,000 c. f., if consent of the Zinc Company to pay that rate was secured, and when 8,300,000 c. f. were furnished; that tb* Zinc Company had theretofore said that it would pay 8 cents if all others did; that, relying upon its ability to procure
On these allegations of fact, the Gas Company bases the following legal conclusions, entitling it to equitable relief: That the action of the two companies in thus remaining silent was a fraud upon it; that had they promptly repudiated the contract, the Gas Company would have discontinued its operations and saved itself serious loss; that legal remedy by shutting off gas or suing for breach of contract would be inadequate and produce a multitude of suits; that legal remedies would not relieve it from threatened insolvency; that where it has performed and the other party refuses performance on the ground of lack of mutuality, statute of frauds, lack of consideration, or other cause, it will be compelled to perform; that its damages are impossible of proof.
“The complaint states a good cause of action on equitable estoppel, and the court should have .given the relief, or after it was¡ transferred to the law docket, submitted the case to the jury.”
Whether the court should have given the relief sought, or should have submitted the case, depends upon the evidence. It claims estoppel based on its having proceeded with performance of its alleged contract without notice by the two companies that they recognized no such contract. The acts which it says the new contract imposed upon it, and which it performed, were to procure Cazort to drill' three wells, and to drill four wells itself. The evidence is conclusive that immediately after the above conference, and before it had heard whether the Zinc Company would join in the contract, it made its contract for drilling four additional 'wells and wired Cazort concerning a contract which was later executed. The Gas Company claims, however, and offered to prove, that they could have canceled these arrangements had the companies promptly notified them, of their refusal to recognize the contract when informed by letter of April 2d of the status and its attitude in claiming the existence of a contract. We have examined the evidence, giving particular attention to that indicated by counsel, and it seems dear that there was never any completed new contract, and in view of the undisputed relation of the parties and the existence of the earlier contracts, we do not think the delay of six weeks by the companies in indicating their attitude can, under the circumstances here present, possibly be construed into an estoppel.
The verdict was properly directed, and the judgment should be, and is, affirmed.
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Reference
- Full Case Name
- CLEAR CREEK OIL & GAS CO. v. FT. SMITH SPELTER CO.
- Status
- Published