payment, like many others contained in the lease contract, is operative only while the lease is alive, without having any bearing whatsoever upon the duration of the lease. The duration of the lease is governed solely by the granting clause, and that clause fixes the period of the lease at five years from the date of approval by the Secretary of the Interior "and as much longer thereafter as oil or gas is found in paying quantities." The five-year period expired in 1925, and, if the lease has been continued in force since that time, it is by reason of the provision "as much longer thereafter as oil or gas is found in paying quantities." That provision is a familiar one in oil and gas leases and is usually construed to mean not only that oil or gas must be discovered but that one or the other must be actually produced in paying quantities, otherwise, the lease expires by its own limitations. Murdock-West Co. v. Logan, 69 Ohio St. 514, 69 N.E. 984; Detlor et al. v. Holland, 57 Ohio St. 492, 49 N.E. 690; Gas Co. v. Tiffin, 59 Ohio St. 420, 54 N.E. 77; Cassel v. Crothers, 193 Pa. 359, 44 Atl. 446; Anthis v. Sullivan Oil & Gas Co. (Okla.) 203 Pac. 187; Collins v. Mt. Pleasant Oil & Gas Co. (Kans.) 118 Pac. 54; United States v. Brown, supra; Union Gas & Oil Co. v. Adkins, 278 Fed. 854, 856. Where, however, gas alone is discovered under a lease providing, not for the payment of a percentage of the gross proceeds from sales of oil or gas, but a fixed sum as a periodic rental for each gas well, there is respectable authority for holding that the "thereafter" clause is complied with by the completion of a well capable of producing gas, even though the product is not marketed or utilized. See Roach v. Junction Oil & Gas Co., 72 Okl. 213, 179 Pac. 934; Summerville v. Apollo Gas Co., 207 Pa. 334, 56 Atl. 876; Smith v. McGill, 12 Fed. 2d, 32. The lease involved in the case last cited was identical with that under consideration. Shortly prior to the expiration of the fixed period of the lease, the lessee completed a well with a daily production of 750,000 cubic feet. After marketing the gas for a few months, the gas ceased to flow through the pipe line because of lack of pressure. The lessee then drilled the well deeper and struck oil in paying quantities. During the period the lease was not producing-a period of about three months-the lessee tendered payment of the fixed royalty of $300, but the lessor declined to accept the same and brought the suit to cancel the lease on the ground that the lease expired upon the cessation of production by its own terms. The court ruled that the finding of gas in paying quantities within the fixed period of the lease vested the lessee with a limited estate in the leased premises for further operations in accordance with the terms of the lease, and that such estate was not lost by a temporary suspension in marketing gas while the lessee was engaged in drilling the well deeper in an effort to find

production in the lower sands. While such a temporary suspension of production was held not to effect a termination of the lease, the court recognized that the limited estate vested in the lessee by finding gas in paying quantities "might be lost by abandonment, manifested by neglecting to produce oil or gas or to pursue the work of production or further development." See also Eastern Oil Company v. Coulehan, 65 W.Va. 531, 64 S.E. 836; Roach v. Junction Oil & Gas Co., supra; United States v. Brown, supra. In the latter case, it was held that the failure of a lessee under a lease like that under consideration to undertake development after disconnecting a gas well for a period of ten months was unreasonable and sufficient in itself to defeat a lease conditioned on oil or gas being found in paying quantities.

Save for the year 1926, when some gas was sold from the well drilled by the Deep Rock Oil Corporation, that company has made no offer of payment of the prescribed royalty for a well producing gas in paying quantities. The payments of $100 were tendered under a provision in the lease relating to unprofitable wells and constitutes in effect an admission by the lessee that the well was not producing gas in paying quantities. For a period of nearly eight years there has been no production whatever from the lease. No effort has been made by the lessee to market the gas nor has it spent a single dollar in further development work. The rule of temporary suspension announced in Smith v. McGill, supra, obviously has no application to such a case, and as it is an undisputed fact that production ceased at some time during the year 1926-27, it is my opinion, upon authority of the cases hereinbefore cited, that the lease then terminated by its own limitations.

The holding over by the lessee after termination of the lease can be regarded at the most as creating a tenancy at will (See Cassell v. Crothers, supra; Continental Oil Co. et al. v. Osage Oil and Refining Co. at al., 69 Fed. 2d, 19). The holding over by the lessee having operated to deprive the lessors of the valuable privilege of leasing the lands to others, they are equitably entitled to retain the payments made by the lessee as a consideration for its continued occupation of the premises. Tenancies at will, under the laws of the State of Oklahoma (Sec. 7344, Compiled Okla. Stats. 1921) may be terminated upon thirty days' notice in writing. A proper regard for the interests of the Indian lessors suggests that such notice be given without further delay.

Approved: April 19, 1934,

OSCAR L. CHAPMAN,

Assistant Secretary.

HOMESTEAD

HAROLD PAUL

Decided April 19, 1934

RESIDENCE OF ENTRYMAN-ACT OF JUNE 6, 1912.

The expressions "have actually resided" and "actual permanent residence", as used in sections 2291 and 2297, Revised Statutes, as amended by the act of June 6, 1912 (37 Stat. 123), contemplate the performance of actual residence as distinguished from constructive residence.

HOMESTEAD "ACTUAL RESIDENCE" CONSTRUED MILITARY SERVICE. "Actual residence," under the homestead laws, means physical occupation of the premises; it means precisely the same thing as actual inhabitancy for seven months each year, subject to proper credit for military service. HOMESTEAD PERSONAL PRESENCE-PRESUMP

HOMESTEADER SINGLE OR MARRIED

TIVE RESIDENCE-TEMPORARY ABSENCES.

Where an entryman is a single person without family, the physical occupation and personal presence must be that of himself; but this Department has repeatedly held that the home of an entryman is presumptively where his family resides, and absence from the entry of the entryman for the purpose of maintaining his family, though in some instances covering several unbroken years, is excusable and does not break the continuity of residence where his family continued to reside upon the homestead.

WALTERS, First Assistant Secretary:

This is an appeal by Harold Paul from a decision of the Commissioner of the General Land Office of October 11, 1933, wherein appellant's final proof on his homestead entry, Los Angeles 049617, was held not acceptable and rejected on the ground that the entryman did not show that he had personally established and maintained residence on the land for the required time.

The entry was made July 21, 1931. Final proof was offered November 4, 1932. The entryman was entitled to credit for two years' constructive residence because of military service. It was necessary, therefore, that he show that he established residence and maintained it for seven months during one year.

The statements in the final proof and supplemental showing of the entryman bearing on his compliance with the residence requirements are as follows:

At the time of entry and at all times since, entryman has been a member of the police force of Los Angeles. On September 1, 1931, he and his wife went upon the land with a load of lumber, built a habitable one-room frame house 16 by 16 feet, cleared brush and lived in a tent until completion of the house, when they moved into the house. The entryman's stay on the land at this time lasted seven days, after which he returned to his duties in Los Angeles, but his wife remained on the entry and made it her continuous place of abode until May 15, 1932, being absent only for short periods of a week or less to obtain medical treatment and obtain supplies. The

entryman repaired to the land and stayed thereon at week-ends and during holidays and vacation. Prior to final proof, five or six acres were cleared and a well sunk 135 feet at a cost of $200, which well is dry.

The entryman states that it was necessary to keep on working to supply his wife with necessities and to make improvements on the homestead; that he had household goods at the time of final proof at his address in Los Angeles.

The ground assigned by the Commissioner for rejecting the final proof upon the facts appearing is not sound and imposes a condition of personal performance of residence requirements by a man with a family that the homestead act does not require, and is contrary to long-established rulings in analogous cases by the Department.

The expressions "have actually resided" and "actual permanent residence", as used in sections 2291 and 2297, Revised Statutes, as amended by the act of June 6, 1912 (37 Stat. 123), contemplate the performance of actual residence as distinguished from constructive residence. "Actual residence ", under the homestead laws, means physical occupation of the premises. It means precisely the same thing as actual inhabitancy for seven months each year, subject, of course, to proper credit for military service. There must be a settled and fixed abode, and that to the exclusion of a home elsewhere. Hazel L. Hartley Johnson (On rehearing, 51 L.D. 513); Josephine M. Locher (44 L.D. 134). Obviously, as in the cases just cited, where the entryman is a single person without family, the physical occupation and personal presence must be that of himself; but this Department has repeatedly held that the home of an entryman is presumptively where his family resides, and absence from the entry of the entryman for the purpose of maintaining his family, though in some instances covering several unbroken years, is excusable and does not break the continuity of residence where his family continued to reside upon the homestead. See Stroud v. De Wolf (4 L.D. 394); Gates v. Gates (7 L.D. 35); Spalding v. Colfer (8 L.D. 615); Thrasher v. Mahoney (8 L.D. 627) ; Edward C. Ballew (8 L.D. 508); Morris v. Sawin (9 L.D. 52).

In a report of an investigation of the entry May 17, 1933, a special agent found the entryman's statements as to residence were corroborated by neighbors. He also stated that entryman was interviewed, who stated that he purchased the house at 9015 Hooper Avenue, Los Angeles, in January, 1926, and that his wife furnished the homestead house from the Hooper house, and lived therein up to the time the entry was made; and that he, personally, while employed on the police force of the city, continued to live in this house except when he went to the entry now and then at week-ends. These statements

of the agent, of course, if impugning good faith or showing failure to comply with the residence requirements, do not warrant rejection of the proof, unless established after due notice and hearing.

The mere fact, however, that the entryman retained his ownership of his former home, kept it furnished and used it as his dwelling place while engaged in his duties as a policeman which necessitated his personal presence in or near the city, does not prima facie show mala fides. The Department in a great number of cases has applied the rule that the entryman must maintain a residence on the homestead to the exclusion of a home elsewhere, but an examination of the facts in these cases will show that in the case of an entryman who was married, his family during the homestead period actually resided elsewhere than upon the homestead. See Bray v. Colby (2 L.D. 78, 81); West v. Owen (4 L.D. 412); Van Gordon v. Ems (6 L.D. 422); Anderson v. Tannehill et al. (10 L.D. 388); Benjamin Chaney (42 L.D. 510); George W. Harpst (36 L.D. 166). Keeping a house in town, to which the family return from time to time, does not in itself prove want of good faith. Higgins v. Wells (3 L.D. 21). In this case the Department said:

The homestead law is a practical law, and is so devised that it may have a practical enforcement. The law itself provides its own evidence of good faith in improvement, cultivation, and residence; if these exist as facts, the law is satisfied. If the things done on the land are sufficient to warrant good faith, we must infer good faith; and we may not go off the land and find a fact elsewhere, from which we may infer bad faith. For example, if a claimant has a hundred dollars' worth of furniture on his homestead, and two hundred dollars' worth in a house that he had occupied before he took the homestead, it would be absurd to infer bad faith from the latter fact. So, if he owns a house in a town, wherein he lived before entering his homestead, and which he retains and visits periodically for purposes of business or pleasure, his good faith is not thereby impeached. The extra furniture and the extra land are not forbidden by anything in either the letter or spirit of the homestead law.

The law requires that the entryman should personally establish residence (Puette v. Greer, 33 L.D. 417), and he must have the concurrent intent to maintain it as long as the law requires. Whaley v. Northern P. Ry. (167 Fed. 664); United States v. Anderson (238 Fed. 648). Gibbs v. Kenny (16 L.D. 22). If his final proof is sufficient, it is immaterial what course the entryman takes after it is submitted, in regard to residing on the entry, and if he elects to abide elsewhere, that cannot be construed as an abandonment of the land. McNamara v. Orr. et al. (18 L.D. 504, 508); Peter Graughan (6 L.D. 224).

In accordance with the views above expressed, the Commissioner's decision is

Reversed.