Cannon v. Cassidy
Supreme Court of Oklahoma
542 P.2d 514 (Okla. 1975)
Lessees signed an oil and gas lease requiring royalty payments to the lessors (plaintiffs), but the lease contained no express remedy provision for a failure to pay; the lessees went 11 months without paying royalties, underpaying by $1,693.62, and the lessors sued seeking cancellation of the entire lease, arguing the nonpayment breached both the lease's express terms and its implied covenant to market. The trial court found cancellation inappropriate, but the court of appeals reversed and cancelled the lease, prompting the lessees' further appeal.
Whether an oil and gas lease may be cancelled as a remedy for the lessee's failure to pay royalties, when the lease itself does not expressly authorize cancellation as a remedy for that breach.