Vanderbilt Law Review

First Page



The practice of the courts of employing almost as many varying and contradictory descriptions of the nature of the lessee's interest under the usual oil and gas lease as there are petroleum producing states has a historical origin which is clearly traceable. In the latter half of the nineteenth century as each of the known oil bearing states was slowly explored and developed for petroleum, it fell the lot of their courts to solve the complicated legal problems arising in this new and unique industry. Equipped with but little accurate scientific knowledge about the physical behavior of oil and gas, and often with no direct legal precedent, these courts found their task a difficult one. It is not surprising that pioneer oil and gas judges turned for guidance to doctrines of common law real property covering situations seemingly analogous to those confronting them. A gradual, but haphazard, reception of real property terminology into the law of oil and gas followed. But the peg has never really fit the hole. No one term in real property law has been found which for all purposes properly describes the oil and gas lessee's interest. Thus, in casting about for real property precedent to govern one petroleum law question the courts of a state came up with one description of the lessee's interest; however, with reference to different issue to be resolved, the quest for common law analogy often yielded quite another characterization. This tendency, when repeated through the years in the several petroleum producing jurisdictions, has produced a markedly conflicting nomenclature. Thus in cases concerned with formal requirements for the creation of the oil and gas lessee's interest the courts have, at one time or another, described this interest as a determinable fee, a profit a prendre, an incorporeal hereditament, more than an incorporeal hereditament, a free-hold, an interest in land, not an interest in land, a chattel interests a license, not a license, personal property and real property.'