United States Court of Appeals for the Sixth Circuit
202 F.2d 863 (6th Cir. 1953)
Joyce (plaintiff) executed an oil and gas lease to a lessee. The lease was granted to the lessee in consideration of the lessee’s drilling of four wells on the premises. The lease also provided that it would be in effect for 60 days “and as long thereafter as Lessee complies with his obligations hereunder, and he produces oil, gas or other minerals in paying quantities from the leased premises.” The lessee later assigned the lease to Wyant (defendant). Within the first 60 days of the lease, Wyant drilled a well that failed to produce. Wyant determined that the drilling of additional wells would be similarly unprofitable. As a result, Wyant declined to drill additional wells. The 60-day primary term of the lease passed. Joyce brought suit for breach of contract, claiming that Wyant had breached the obligation to drill four wells. Wyant filed a motion to dismiss for failure to state a claim, arguing that the lease had terminated on its own terms. The district court granted Wyant’s motion to dismiss. Joyce appealed.
Rule of Law
Holding and Reasoning (Miller, J.)
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