Oil and Gas Leases: Title; Breach of Warranty Bonus: Failure of Title; Unjust Enrichment

摘要

The Whillocks, the defendants, owned an 80-acre tract of land in Van Buren County. In 2005 or 2006, the defendants received from a third party an offer to lease the minerals. Mr. Whillock then discovered that they did not own the mineral rights and they did not enter into the oil and gas lease. In 2008, a landman for the plaintiff, Chesapeake Exploration, LLC. (Chesapeake), offered to lease the mineral rights from the defendants. Mr. Whillock informed the landman that they did not own the minerals. The landman insisted that the defendants did own the minerals and offered an additional signing bonus for the lease. The defendants then executed an oil and gas lease to the plaintiff on January 21,2008. That same day, the defendant gave the plaintiffs a sight draft for a $120,000 bonus. Plaintiff subsequently paid the draft to the defendants. The defendants paid the taxes on the $120,000 and spent the remainder. Subsequently a Drilling Title Opinion was procured by plaintiff that indicated that the defendants did not own the mineral rights. Approximately nine months after the draft was paid, plaintiff wrote the' defendant and requested a refund of the $120,000. Included in the letter was a recorded release of the oil and gas lease executed by the plaintiff in favor of the defendants.