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should have formal notice of what he already knew; viz., that the condition was not performed. To the same effect are the other cases cited by the appellant: Dickeyv. McCullough, 2 Watts & S. 99; Feather v. Strohoecker, 3 Penr. & W. 508; 24 Am. Dec. 342; and Bear v. Whisler, 7 Watts, 149. The same rule has been applied to leases for years: Kenrick v. Smick, 7 Watts & S. 41; Sheaffer v. Sheaffer, 37 Pa. St. 525; Davis v. M088, 38 Pa. St. 346; Brown v. Bennett, 75 Pa. St. 420; Brown v. Vandergrift, 80 Pa. St. 142; and Munroe v. Armstrong, 96 Pa. St. 307. But as by the terms of the lease Ray, the plaintiff, was entitled to remain in possession of the land, subject to the right of the company to drill and operate for oil and gas, his occupancy of the land at and after the time of the breach can be of little consequence, unless by some act in assertion of the forfeiture he gave it a greater effect. It was certainly not necessary that he should abandon the possession, to which, by the very terms of his contract, he was entitled, in order that he might insist upon performance by the lessee; the lessor's election to forfeit whilst he is in the actual possession may be regarded as a constructive entry under his title.

But it is said that the doctrine declared in Wills v. Manufacturers' Natural Gas Co., 130 Pa. St. 222, is an innovation or change in the law; that the parties must be presumed to have contracted in view of the general law as it was expounded when their engagements were formed; and to determine the legal effect of the contract otherwise is to impair its obligation, in contravention of the tenth section of the first article of the federal constitution. In Kenrick v. Smick, 7 Watts & S. 41, and in Sheaffer v. Sheaffer, 37 Pa. St. 525, although the condition in each case was inserted in the interest of the lessor, it was held that upon breach of the condition by the lessee, the lease was ipso facto absolutely void without re-entry, and could not afterwards be affirmed or continued by any subsequent recognition of the tenancy on part of the lessor, or by any act of his, other than the making of a new lease. But, as we said in Willz v. Manufacturers' Natural Gas Co., 130 Pa. St. 222, the rigor of the rule was relaxed in Davis v. Moss, 38 Pa. St. 346, where the forfeiture was said to depend upon the terms of the instrument, “ unless there be evidence to affect the landlord with a waiver of the breach, like the receipt of rent or other equally unequivocal act," in which case the lease may be continued at the instance of the lessee. The ruling in Davis v. Moss, 38 Pa. St. 346, was the first step in the transition from the doctrine of Kenrick v. Smick, 7 Watts & S. 41, to the now well-settled rule laid down in Galey v. Kellerman, 123 Pa. St. 491, and Wills v. Minifacturers' Natural Gas Co., 130 Pa. St. 222, where the princi. ple is established that where the condition appears to have been inserted solely in the interest of the lessor, the lease is void upon the breach, if the lessor by some positive act elects to take advantage of it. The departure from Davis v. Moss, 38 Pa. St. 346, is greater, perhaps, than the reasoning in the case last cited would seem to indicate, but it was taken on due deliberation and careful study of the principles involved, and we are not inclined to recede from the position assumed.

It is a somewhat significant fact that in all the cases cited, including Davis v. Moss, 38 Pa. St. 346, the forfeiture was set up by the lessor, in whose interest the condition was inserted, upon the default of the lessee; in none of them, as in the case at bar, did the lessee set up his own default as a cause of forfeiture. No case has been brought to our notice in which the lessee was allowed to take advantage of his own wrong, or to set up his own default, to work a forfeiture of his own contract; it must be conceded, however, that if the old rule is the right one, this anomalous result must ensue.

Persons may, perhaps, contract expressly in this form, and to this effect; when they do, the transaction amounts to a mere option, and the lessee in setting up his own default simply avails himself of an elective right secured to him in his contract. We do not understand the contract in suit to be of this character. The clear

purpose of the lessor was to have his lands operated for oil or gas, and the condition was inserted for his benefit. Whilst the obligation on part of the lessee to operate is not expressed in so many words, it arises by necessary implication. The lease was for the express' purpose of drilling and boring for oil or gas, the lessor in a certain event to receive a share of the production as a royalty or rent, and in another event to be paid five hundred dollars per annum for each gaswell the product of which was conducted from the land for consumption. If a farm is leased for farming purposes, the lessee to deliver to the lessor a share of the crops, in the nature of rent, it would be absurd to say, because there was no express engagement to farm, that the lessee was under no obligaton to cultivate the land; an engagement to farm in a proper manner, and to a reasonable extent, is necessarily implied. The clear purpose of the parties to this lease was to have the

lands developed, and the half-yearly payments and the other sums stipulated were intended not only to spur the operator, but to compensate Ray for the operator's delay or default. The lessor's hands have been tied for two years. We do not know that he lost anything in royalties, or that he suffered by drainage, for the territory might have proved unproductive; but as the transaction was founded in the hope that either oil or gas, or both, might be found in paying quantities, it was competent for the parties to contract in advance for the amount of compensation to which, in the event of delay or default in development, the lessor would be entitled. The provision for forfeiture was doubtless inserted in anticipation that the lessee might make default and become unable to pay, in which event he might put an end to the lessee's pretensions, and seek other means of development. This clause having been inserted as a protection to the lessor, he had the right either to declare the forfeiture or to affirm the continuance of the contract; and if the lessor did not choose to avail himself of the forfeiture, the lessee cannot set it up as a defense to an action in affirmance of the contract: Galey v. Kellerman, 123 Pa. St. 491; Wills v. Manufacturers' Natural Gas Co., 130 Pa. St. 222,

The courts of highest authority of all the states, and of the United States, are not infrequently constrained to change their rulings upon questions of the highest importance. In so doing, the doctrine is, not that the law is changed, but that the court was mistaken in its former decision, and that the law is, and really always was, as it is expounded in the later decision upon the subject. The members of the judiciary in no proper sense can be said to make or change the law; they simply expound and apply it to individual cases. To this general doctrine there is a well-established exception, as follows: "After a statute has been settled by judicial construction, the construction becomes, so far as contract rights are concerned, as much a part of the statute as the text itself, and a change of decision is to all intents and purposes, the same, in effect, on contracts as an amendment of the law by means of a legislative enactment”: Douglass v. Pike Co., 101 U. S. 677. See also Anderson v. Santa Anna, 116 U. S. 361, and cases there cited; Cooley's Constitutional Limitations, 474-477. To this effect, and no more, we understand to be the cases of Ohio etc. Trust Co. v. Debolt, 16 How. 432; Gelpcke v. Dubuque, 1 Wall. 175; Hatemeyer v. Iowa Co., 3 Wall. 294; Olcott v. Supervisors, 16 Wall. 678. In Ohio etc. Trust Co. v. Debolt, 16 How. 432, the doctrine is thus stated: “The sound and true rule is, that if a contract, when made, was valid by the laws of the state as then expounded by all the departments of the government and administered in its courts of justice, its validity and obligation cannot be impaired by any subsequent act of the legis. lature, or the decision of its courts altering the construction of the law.” The ruling applies, it will be observed, not to the general law common to all the states, but to the laws of the state "as expounded by all the departments of its government"; and it is held that contracts valid by these laws may not be impaired, “either by subsequent legislation, or by the decisions of its courts altering their construction." The reference is, of course, to the statute law.

In New Orleans Water-works Co. v. Louisiana etc. Co., 125 U. S. 18, the law on this subject is stated as follows: "In order to come within the provision of the constitution of the United States which declares that no state shall pass any law impairing the obligation of contracts, not only must the obligation of a contract have been impaired, but it must have been impaired by a law of the state. The prohibition is aimed at the legislative power of the state, and not at the decisions of its courts, or the acts of administrative or executive boards or officers, or the doings of corporations or individuals. This court, therefore, has no jurisdiction to review a judgment of the highest court of a state on the ground that the obligation of a contract has been impaired, unless some legislative act of the state has been upheld by the judgment sought to be reviewed.” “We are not authorized by the judicary act," says Mr. Justice Miller, in Knox v. Exchange Bank, 12 Wall. 383, "to review the judgments of the state courts because their judgments refuse to give effect to valid contracts, or because those judgments, in their effect, impair the obligation of contracts. If we did, every case decided in a state court could be brought here, when the party setting up a contract alleged that the court had taken a different view of its obligation to that which he held.” To bring the case within this provision of the federal constitution, it must be the constitution, or a statute, or some enactment that has the force of law, either of the state or of some municipality exercising legislative power delegated by the state, which impairs the obligations of a contract: Williams v. Bruffy, 96 U. S. 176-183; United States v. Nero Orleans, 98 U. S. 381-392; Murray v. Charleston, 96 U. S. 432-440; Meriwether v. Garrett, 102 U. S. 472. In the very recent case of Lehigh Water Co. v. Easton, 121 U. S. 388, Mr. Justice Harlan says: "The state court may erroneously determine questions arising under a contract which constitutes the basis of the suit before it; it may hold the contract void, which in our opinion is valid; it may adjudge the contract to be valid, which in our opinion is void; or its interpretation of the contract may, in our opinion, be radically wrong; but in neither of such cases would the judgment be reviewable by this court under the clause of the constitution protecting the obligation of contracts against impairment by state legislation, and under the existing statutes defining and regulating its jurisdiction, unless that judgment, in terms, or by its necessary operation, gives effect to some provision of the state constitution, or some legislative enactment of the state, which is claimed by the unsuccessful party to impair the obligation of the particular contract in question.”

The affidavit, in our opinion, is insufficient, and the judge ment was rightly entered. Judgment affirmed.

SMILEY V. GAS COMPANY. CLARK, J. The clause of forfeiture in this case would seem to apply, not to the half-yearly sums of $250, but to the annual payments of $500 to be made for gas rent of the well, or each of the wells, the product of which should be conducted off the farm for consumption within the period covered by the lease, which was “ for two years, or so long thereafter as oil or gas is found in paying quantities," or to a failure to put down any well within two years. There was no time within two years in which the lessees were bound to put down a well under penalty of forefeiture; but for certain periods of delay within that time they were to pay certain sums of money, which in a certain event were to be credited

the rent, when a well or wells were put down producing oil or gas in paying quantities. The last payment of $250 was due on February 4, 1890, and the suit was brought March 14, 1890, whilst the two years did not expire until August 4th thereafter. The time for forfeiture, therefore, had not yet arrived. But if this were not so, the case is governed by our opinion filed in Ray v. Western Penn. Natural Gas Co., 138 Pa. St. 576; ante, p. 922, filed at present term. The judgment is affirmed.


AM. ST. REP., VOL. XXI. - 59

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