McMillan v. Philadelphia Co.

Citations

• 159 Pa. 142
• 28 A. 220
• 1893 Pa. LEXIS 1488

Syllabus

<p>• Contract — Option—Oil htase — Forfeiture.</p> <p>An option is an unaccepted offer stating the terms and conditions on which the owner is willing to sell or lease his land, if the holder elects to accept them within the time limited. If the holder does so elect he must give notice to the other party, and the accepted offer thereupon becomes a valid and binding contract. If an acceptance is not made within the time fixed, the owner is no longer bound by his offer and the option is at an end.</p> <p>The lessee in an oil lease covenanted to commence operations within sixty days, and complete one well on the leased premises within three months thereafter; and in case of failure to complete one well within such time he agreed “ to pay thereafter as rental to the party of the first part for such delay the sum of twenty-five dollars per month until one well shall be completed.” The duration of the term was three years “ and as long’ thereafter as oil and gas shall continue to be found in paying quantities.” It was provided that a failure to perform the contract or any of its conditions should render the lease null and void, and no longer binding on either party. Following the forfeiture clause were these words: “ he (the lessee) having the option to drill the well or not or pay said rental or not as he may elect.” Held, that the lease did not give to the lessee the option to refuse both to drill a well, or pay a monthly rental if it so pleased him, but that he was bound either to drill the well and so pay no rental, or to pay the rental, and not be compelled to drill the well.</p>