Fifth. While the subject of royalty generally is reserved to the following article, we have been compelled to advert to it incidentally in some of the foregoing sections to the extent of showing wherein it becomes an element or condition of the tenancy. Where the tenancy is limited to the exhaustion of the mine the dead rent must be paid to that time, and it is held not a sufficient excuse that the coal or mineral is difficult to obtain. But the better line of reasoning seems to be that reasonable diligence in the exhaustion of minerals and in the pursuit of oil or gas is all that can be reasonably required, and that in no case will either law or equity require the performance of impossibilities. And in such extreme cases the law will convert the tenancy into a fixed period or a tenancy at will, as the case may be. But while this is true on the one hand, the lessee may not arbitrarily refuse to mine or bore. Sixth. The law frowns upon forfeiture, and will not permit it to be exacted except for good and sufficient reasons; and where the right to claim a forfeiture is reserved to the lessor, he must exercise reasonable diligence in asserting his rights, or he will be controlled by the general doctrine of waiver. But a waiver of one breach is not a waiver of others, nor is the waiver of one condition to be construed as the waiver of others. The forfeiture clause in instruments is thus seen to be for the benefit of the lessor, and is not generally self-executing, and notice of intention to claim must in general be given. ARTICLE D. Rents and Royalties. § 1251. Royalties defined and classified - Outlines. 1252. On the basis of clean ore or coal. 1953. Of the net product - Duty as to marketing. 1254. For a graduated rate. 1255. Of the royalty based on a minimum rate per ton. 1256. Meaning of merchantable and clean ore, and of mine run. 1257. Meaning of net proceeds as applied in the western states. § 1258. Net proceeds as a measure of damages. 1259. Royalty covenants generally - Delay and dead rent. 1260. Same subject — Minimum royalty and dead rent - When liable for, at all events- When not sufficient. 1261. Conflicting doctrine - Payable out of any year. 1262. Exhausted premises - Dead rent not recoverable when paid under mutual mistake-Failure of consideration. 1263. No duty to pay after exhaustion - Distinction between lease and sale. 1264. Not bound to dig new pits - Minimum rent the essence of the agreement. 1265. Pay for coal taken out - May not remain idle - Suspension — Eviction. 1266. Royalties referable to and payable out of marketable products. 1267. Same subject - Graduated rate · 1268. "Expense of winning" defined. 1269. Custom of interpreting a lease. 1270. No rent due until possession taken. Produced but not marketed. 1271. Circumstances excusing the payment of minimum rent. 1272. Further as to minimum royalty - Meaning of miner's weight 1273. Lien for royalties. 1274. State's action on royalty bond. 1275. Each operation distinct mines. No right to mix product of different. 1276. Summary - The doctrine of this article restated. § 1251. Royalties defined and classified - Outlines.— Royalty is the name generally applied to the rent reserved to the lessor in leases of mines, payable either in kind or money, and generally based upon the quantity or value, or both, of the product. It is quite apparent from the matter set forth in the foregoing sections that the legal learning on the subject of mining leases is by no means settled, and the opinions of the judges are not harmonious. Upon the involved subject of royalty, however, the trend of judicial opinion is indicative of a disposition looking towards a general classification thereof upon at least three lines: First. Upon a basis of clean ore after deducting mining and treatment charges, including washing or concentrating, which would likewise include, in the west, the process of jigging or concentrating to reduce ore to a marketable condition. Second. The net product after paying cost of transportation, marketing, sampling and treating, after the ore is raised or mined. This is the basis generally adopted in the west in mining the precious metals, and in such case the transportation and treatment include the railway freight, the sampling charges and the commission for selling. Third. Based upon a graduated rate per ton of coal or iron ore raised, mined and ready for marketing. This is the basis largely in force in the coal and iron mining districts, and the coal is often again classified into at least two classes, the lump coal passing over a certain mesh screen, and the finer coal rejected by a smaller screen, with occasional interests in the culm or slack. We will proceed to consider these in their order. § 1252. On the basis of clean ore or coal. In such cases the expense of cleaning is often a matter for the lessee. For example, in a leading case in Tennessee where a lease of mineral land provided that the lessee should pay a royalty of one-tenth on the product of the mine, delivered at the mine or shaft in shipping order or accessible to wagons, or pay for the same the cost price of mining and delivery as above stated. For some time the ore was taken from the mine by hand-shovels, loaded into wagons, and afterwards thrown on reels, sifted and weighed, such weight forming the basis of payment of royalty; later the lessees put in an improvement in the shape of expensive machinery to sift and wash the ore, and on the trial of an action brought for the royalty, the court decided that the cost of the machinery did not enter into the cost of mining contemplated by the parties as the basis of royalty. It is not our purpose in this work to cite to any great extent authorities on elementary principles; it is only under peculiar circumstances and Nunnelly v. Warner Iron Co., 91 Tenn. 282, 29 S. W. Rep. 124. But see Van Meter v. C. & V. M. Coal Co., 88 Iowa, 92, 55 N. W. Rep. 106; Foster Coal Co. v. Moherman, 9 Ohio Cir. Ct. 544; Walker v. extreme cases in which courts need generally seek authority, precedent or guidance. § 1253. Of the net product-Duty as to marketing.This provision is the one, as we have said, most common in the west, and it is customary in making mining leases to provide for abandonment in case no merchantable ore is found, or in case of being drowned out by water, or prevented by other unforeseen calamity from continuing operations. It is likewise customary to provide that cessation of work in case of interruption by process of court will not work a forfeiture. There is little more to be added to what has already been said on this branch; but where a mining lease contains a covenant by the lessees to pay a certain royalty, which shall amount to at least a given sum, they are not liable, after testing, if no merchantable ore is found. But of course this test must be made in good faith,2 and a lessee may quit at any time under a lease containing no covenant to work. It would seem to be plain in this class of cases, in the absence of stipulation to the contrary, that the lessee is bound to seek the best market if he markets the ore; that he should use reasonable care in sorting and cleaning it, and where jigging and concentrating is also provided for, or is customary, it should be done in the most approved manner. In short, from mining the ore, through every step to the marketing, careful and prudent workmanship and conduct and fair business dealing are required. § 1254. For a graduated rate.- Another mode of paying royalty is upon the basis of a graduated rate for each class of the product, making the rate different upon one class 1 Gribbin v. Atkinson, 64 Mich. M. R. 688; Strelley v. Pearson, 15 651, 31 N. W. Rep. 570. 2 Ante, §§ 1182, 1202. 3 Glasgow v. Chartiers Co., 25 Atl. Rep. 232; Gowan v. Christie, 2 Scotch App. 273, 5 Moak, 114, 8 Ch. Div. 113, 7 M. R. 618; Drake v. Laco, 157 Pa. St. 17, 27 Atl. Rep. 538; Smith v. Munhall, 139 Pa. St. 253, 21 Atl. Rep. 735. from that on others. Of this mode it is sufficient to say that the lessee may not, from motives of his own, or fraudulently, arrange the higher into the lower class and attempt to pay accordingly. For example, where a lease provides for a royalty for lump and nut coal at different rates, the lessee cannot escape the royalty on lump coal by reducing it to the smaller size, even though the demand in the market is greater for such smaller coal.1 § 1255. Of the royalty based on a minimum rate per ton. It may be laid down as a general rule in this class of cases, that where the stipulations of the lease require the mining of a certain number of tons per annum or per month, and the payment of a fixed royalty thereon, the lessor is entitled to be paid the minimum amount, that is, whatever the minimum number of tons would net him. He is entitled to receive not only the stipulated rent, but this is a stipulated damage for occupation. There are a few decisions to the contrary, based upon the peculiar language used in the lease under consideration, but the foregoing propositions are supported by the great weight of authority." § 1256. Meaning of merchantable and clean ore, and of mine run.- It is sometimes said that the words "clean ore " 1 Wright v. Warrior Run Coal Co., 182 Pa. St. 514, 38 Atl. Rep. 491; Schooley v. Butler M. Co., 175 Pa. St. 261, 34 Atl. Rep. 639; s. C., 9 Kulp, 291. 2 Central Apallachian Co. v. Buchanan (C. C. A.), 73 Fed. Rep. 1006; Genet v. Delaware & Hudson Canal Co., 163 N. Y. 173, 57 N. E. Rep. 297: Walker v. Tucker, 70 Ill. 527, 8 M. R. 672; Bute v. Thompson, 13 M. & W. 437, 8 M. R. 371; Watson Coal Co. v. Casteel, 73 Ind. 296, 9 M. R. 130; Schooley v. Butler M. Co., 175 Pa. St. 261, 34 Atl. Rep. 639; Genet v. Delaware & Hudson Canal Co., 37 N. Y. S. 1087; Woodward v. |