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Humble Oil & Refining Co. v. Kishi
Texas Commission of Appeals
276 S.W. 190 (Tex. Com. App. 1925)
Kishi (plaintiff) owned the surface and three-fourths of the mineral rights of a tract of land. Kishi leased to Humble Oil & Refining Co. (Humble) (defendant) the exclusive right to drill for oil on the land for a period of three years. Humble found no oil. However, Humble later learned that oil was found in the adjacent tract of land, and returned to initiate more drilling. Humble believed in good faith that its lease was still valid when this second round of drilling occurred, but the lease had in fact expired. In any event, this round of drilling also found no oil on Kishi’s property. Kishi brought suit to recover damages for the second round of drilling. The district court found in favor of Kishi, but awarded him only nominal damages. The court of appeals reversed the judgment, finding in favor of Humble. Kishi appealed.
Rule of Law
Holding and Reasoning (Bishop, J.)
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