Delay Rentals

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Delay Rentals

 

 In the case of Griggs v. Parsons Leasing, Inc., 776 So.2d 766 (Ala. 2000), the Alabama Supreme Court held that the date recited in an oil and gas lease as the date of the lease was the base date for calculating the delay rental payment date rather than the actual date of execution of the lease.   The court also held that a notice-and-demand clause in the lease did not save the lease from the untimely tender of the delay rental because the timely payment of the delay rental was a condition precedent to the extension of the lease term.   At issue in the case was an one-year State of Alabama lease granted to Parsons for a bonus of $75,450.  The delinquent delay rental was $100.60. The court held that the Lessee failed to tender timely and that the lease automatically terminated.

Copyright 2011 by Edward G, Hawkins. All rights reserved.