British-American Oil Producing Co. v. Buffington

McCORD, Circuit Judge.

J. J. Dorr owned an oil and gas lease on a section of undeveloped land in Pecos County, Texas. On July 30, 1937, he entered into a contract with D. M. Buffington and C. R. Smith for the drilling of a test well on the property. As consideration for drilling the well, Buffington and Smith were to receive a cash payment of $3,000 together with an undivided one-fourth interest in the oil and gas lease on the section of land. Among other things the contract provided:

“It is further understood and agreed that in the event said well is a producer, we *364(Buffington and Smith) are…