Elless v. State Bank

Citations

• 108 Kan. 403
• 195 P. 875
• 1921 Kan. LEXIS 55

Syllabus

<p>SYLLABUS BY THE COURT.</p> <p>Sale op Land — Action for Price — Defense Breach of Warranty Against Encumbrances — Oil and Gas Lease. An owner of land executed an oil and gas lease which contained the following stipulation:</p> <p>“It is further mutually agreed by and between said party of the first part, and said party of the second part, that the said party of the -second part shall have the right to surrender this lease to said party of the first part at any time upon payment of $50.00 on a good and sufficient quitclaim deed.”</p> <p>The owner conveyed the land by a warranty deed and assigned his interest in the lease to another. The conveyance was made subject to the oil and gas lease which it was recited had been duly recorded in a certain volume of the records. In recording the lease the words in the forfeiture clause “have the right to” between the words “shall” and “surrender” were inadvertently omitted. When the land was conveyed to the grantee the lessee had expended $18,000 in development and had seyen oil-producing wells on it. Of these facts the grantee had knowledge, and the lease at that time was worth from $15,000 to $25,000. Subsequently the grantee asserted the right to terminate the lease on the payment of $50, but his claim was refused by the lessees. In this action brought by the grantor to recover the balance of the consideration the grantee asserted a breach of the warranty in the conveyance. Held, that the forfeiture clause did not give either the owner or his grantee the option to compel a surrender of the lease on the payment of $50, and that there was no breach of the warranty contained in the deed of the grantor.</p>