The defendants insist upon application of the rule that the court should assume the position of the parties and consider the instrument, its purpose, and the surrounding circumstances. Crain v. Pure Oil Co. (C.C.A.) 25 F.2d 824. And further they contend a construction is preferred which is fair and appeals to prudent men rather than one that is inequitable or an unlikely act of reasonable men. Iron Mountain Oil Co. v. Edwards, 100 Okla. 4, 227 P. 150; Withington v. Gypsy Oil Co., 68 Okla. 138, 172 P. 634. And upon these authorities it is insisted the option to reassign and be released was carried into the modification contract.
Brown v. Coppadge, 153 P. 817, 54 Okla. 88 (1915); Wolf v. Blackwell Oil and Gas, 186 P. 484, 77 Okla. 81 (1920).Iron Mountain Oil Co. v. Edwards, 227 P. 150, 100 Okla. 4 (1924). III
In considering this transaction we must place ourselves as far as possible in the position of the parties when the contract was entered into and consider the instrument itself as drawn, its purposes, and the circumstances surrounding the transaction, and, from a consideration of all the elements determine upon what sense or meaning of the terms used their minds actually met. See Iron Mountain Oil Co. v. Edwards, 100 Okla. 4, 227 P. 150, and cases therein cited. The substance of plaintiffs' testimony was that defendant delivered to them the letter in compliance with an oral agreement to the same effect as the contents of the letter and stated that their reasons for doing so was that once prior to this transaction they leased their property for $7.50 an acre and shortly thereafter some of the other fractional owners of the leased property were paid a bonus of around $500 an acre, and they did not want that to happen to them again.
At that rate the 1/8 would be worth $20,000. If the contract is susceptible of two constructions, the court should adopt that construction which is fair and such as prudent men would naturally intend by the use of the words employed by the parties in the contract. Iron Mountain Oil Co. v. Edwards, 100 Okla. 4, 227 P. 150. Would a prudent man pay $5,000 for one-fourth interest in 1/8 of the production, etc., from town lots if there is no production upon the property and no obligation upon the seller to drill? Bearing in mind the evidence in the case, the contract as written, the facts and circumstances surrounding its execution, the language used in the contract, we conclude that by said contract defendant as a part of his engagement with plaintiff obligated himself to drill the well to the Wilcox sand, and that by his failure to do so, he breached his contract, and is liable to plaintiff for damages, unless, of course, the defendant is entitled to be relieved from his contractual duty by reason of the facts set forth in his answer, or otherwise.
1. Contracts — Method of Construction of Ambiguous Written Instruments. In construing ambiguous written instruments, the court must place itself, as far as possible, in the position of the parties when the contract was entered into, and consider the instrument itself as drawn, its purposes and the circumstances surrounding the transaction, and, from a consideration of all these elements, determine upon what sense or meaning of the terms used their minds actually met. (Iron Mountain Oil Co. v. Edwards et al., 100 Okla. 4, 227 P. 150.) 2.
(3) The surrounding circumstances are to be looked to as reflecting the true intention of the parties to a contract. This rule is stated by this court in the case of Iron Mountain Oil Co. v. Edwards, 100 Okla. 4, 227 P. 150, in the following language: "In construing written instruments the court must place itself, as far as possible, in the position of the parties when the contract was entered into; and consider the instrument itself as drawn, its purpose and the circumstances surrounding the transaction; and, from a consideration of all these elements, determine upon what sense or meaning of the terms used their minds actually met."
It will be well to bear in mind the rule so often announced and so firmly established by this court as follows: "The law does not authorize the reformation of a written contract on the grounds of mutual mistake (i. e., a mistake by each of the parties thereto) unless the proof of such mutual mistake is clear and convincing," Muskogee Refining Co. v. Waters Pierce Oil Co. et al., 89 Okla. 279, 215 P. 766: Iron Mountain Oil Co. v. Edwards et al., 100 Okla. 4, 227 P. 150. In Davis v. Keeche Oil Gas Co., 89 Okla. 226, 214 P. 711, this court said: