Guthrie McLaren Drilling Ltd. v. Inland Development Co., (1977) 2 A.R. 519 (TD)

• Judge: Miller, J.
• Court: Court of Queen's Bench of Alberta (Canada)
• Case Date: February 15, 1977
• Citations: (1977), 2 A.R. 519 (TD)

Guthrie McLaren Drilling v. Inland Dev. (1977), 2 A.R. 519 (TD)

MLB headnote and full text

Guthrie Mclaren Drilling Ltd. v. Inland Development Co. Ltd.

Indexed As: Guthrie McLaren Drilling Ltd. v. Inland Development Co.

Alberta Supreme Court

Trial Division

Judicial District of Edmonton

Miller, J.

February 15, 1977.

Summary:

This case arose out of a claim for the cost of extra work involved in "fishing" drilling equipment from a hole. The plaintiff drilling contractor drilled a gas well to 2,770 feet for the defendant owner. When the drilling contractor commenced to pull his equipment out of the hole the drill bit became stuck in the hole 63 feet from the bottom. Specialized equipment and 3 1/2 days extra work was required to free or "fish" the equipment from the hole. The contractor was working on a day-work basis when the drill bit became stuck in the hole. The Alberta Supreme Court stated that it was customary in the industry for the cost of "fishing" operations to be borne by the owner when the drilling contractor is working on a day to day basis and to be borne by the contractor when the contractor is working on a footage basis - see paragraph 6.

The Alberta Supreme Court allowed the building contractor's claim against the owner for $34,157.00 for the extra cost of freeing the equipment from the hole. In addition, the Alberta Supreme Court allowed the plaintiff eight per cent interest on the $34,157.00 from June 19, 1975 (the date the work was performed) to the date of judgment. There was no provision in the drilling contract for interest.

Interest - Topic 5303

Interest as damages - Interest on payment of a just debt withheld by a debtor where the parties made no agreement respecting interest - Amount due under an oil drilling contract - The Alberta Supreme Court, Trial Division, awarded a drilling contractor $34,157.00 for the cost of "fishing" operations and awarded the drilling contractor eight per cent on $34,157.00 from June 19, 1975 (the date the work was performed) to the date of judgment.

Interest - Topic 5308

Interest as damages - Interest on payment of a just debt withheld where the parties made no agreement respecting interest - Rate of interest applicable - The Alberta Supreme Court, Trial Division, fixed the rate of interest at eight per cent in the absence of evidence of the bank borrowing rate over the applicable period - See paragraph 14.

Mines and Minerals - Topic 8213

Oil and gas - Drilling agreements - Implied terms respecting "fishing" operations - A drilling contractor drilled a gas well to 2,770 feet and then commenced to pull its equipment out of the hole - The drill bit became stuck in the hole 63 feet from the bottom - Specialized equipment and 3 1/2 days of extra work was required to free or "fish" the equipment from the hole - The contractor was working on a day-work basis when the drill bit became stuck in the hole - The Alberta Supreme Court, Trial Division, allowed the drilling contractor's claim against the owner for $34,157.00 for the extra cost of freeing the equipment - The Alberta Supreme Court stated that it was customary in the industry for the cost of "fishing" operations to be borne by the owner when the drilling contractor is working on a day-work basis - See paragraph 6.

Cases Noticed:

Prince Albert Pulp Company Ltd. et al. v. Foundation Company of Canada Limited, 8 N.R. 181; [1976] 4 W.W.R. 586, folld. [para. 14].

Counsel:

D.D. Duncan, for the plaintiff;

William Rice, for the defendant.

The judgment of the Trial Division of the Alberta Supreme Court was delivered at Edmonton, Alberta, on February 15, 1977.