Tenneco Oil Co. v. Humble Oil & Refining Co.

LAVENDER, Justice.

This appeal involves the following question: Where actual notice of the prior existence of an oil and gas lease is imparted to one seeking to also obtain such a lease does the latter exercise “reasonable diligence” in inquiring as to the continued effectiveness of such lease where he limits his inquiry to questioning the intended lessor as to any outstanding leases? The trial court in effect answered such question in the negative. Under the circumstances herein we agree.

This action was commenced in the court below by the Humble Oil and Refining Company, as plaintiff, against…