Russell v. Johns Manville Co

In Russell v. Johns Manville Co. (1971) 20 Cal.App.3d 405, the lessors entered into a mining lease with the lessee. The lease did not require the lessees to pay rent but instead provided for the payment of royalties to the lessors. (Id. at p. 408.) Although the lease did not expressly obligate the lessee to engage in mining activities, the court implied a covenant on the part of the lessee to proceed with mining operations with reasonable diligence. (Id. at p. 410.) This implied covenant was also a condition precedent to the lessor's performance, the nonoccurrence of which allowed the lessor to declare the lease forfeited. (Id. at pp. 410-413.)