Greer v. Carter Oil Co.
Supreme Court of Illinois
25 N.E.2d 805 (Ill. 1940)
After receiving an unrecorded deed to land in 1933, Mark Greer (plaintiff) waited until 1938 to record it, two years after the prior owner had granted Carter Oil Company (defendant) an oil and gas lease with a three-year primary term (expiring May 28, 1939) extendable by production; in October 1938, Greer sued to quiet title, arguing Carter's lease was invalid, and the lease expired during the litigation without a producing well ever being drilled, since Carter faced potential liability either way -- for producing without clear title, or for drilling a non-producing well and damaging the land's value -- while Greer's suit was pending. The circuit court found Carter's lease valid and gave Carter additional time after the ruling to complete the lease's requirements, and Greer appealed.
Whether a lessor who sues to cancel an oil and gas lease, thereby preventing the lessee from safely drilling during the pendency of the litigation, may claim after the litigation that the lease is invalid because it expired without production during the lawsuit.