Hamilton-Collinson Hardware Co. v. Arkansas City Oil & Gas Co.

Citations

• 102 Kan. 144
• 169 P. 190
• 1917 Kan. LEXIS 237

Syllabus

<p>SYLLABUS BY THE COURT.</p> <p>1. Oil and Gas Company. — Lease—Forfeiture—Garnishment of Assets— Rights of Creditors. An oil and gas company obtained leases, purchased a rig, tools and appliances, and began the drilling of a well on the land of a lessor. In the lease was a clause that upon a failure of the lessee to drill or complete a well in a certain time or make certain payments the lessor could declare a forfeiture after ten days’ notice. Before the well was completed the lessee became insolvent, allowed its leases to lapse, left its rig, tools and appliances on the farm of the lessor, and abandoned the enterprise. Persons who performed labor for the company obtained judgments against it and procured the service of a garnishee summons upon the lessor on whose land the rig, tools and appliances of the company were left. In a controversy between creditors it is held, that although the lessor had not declared a forfeiture of the lease, he is to be regarded as in possession and control of the property left on his farm, for the purpose of garnishment, and that he was a proper garnishee in the actions brought by the laborers.</p> <p>2. Same — Lease — Abandonment — Notice of Forfeiture Unnecessary. Since the lease had been allowed to lapse and the lessee had abandoned the enterprise and is not claiming any right under the lease, a formal forfeiture by the lessor after giving notice -was not necessary to his liability as a garnishee in the actions brought by creditors of the company.</p>