A. T. Barrett, Jr. v. Atlantic Richfield Company

444 F.2d 38, 39 Oil & Gas Rep. 101, 1971 U.S. App. LEXIS 10152
CourtCourt of Appeals for the Fifth Circuit
DecidedMay 17, 1971
Docket29795_1
StatusPublished
Cited by32 cases

This text of 444 F.2d 38 (A. T. Barrett, Jr. v. Atlantic Richfield Company) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fifth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
A. T. Barrett, Jr. v. Atlantic Richfield Company, 444 F.2d 38, 39 Oil & Gas Rep. 101, 1971 U.S. App. LEXIS 10152 (5th Cir. 1971).

Opinion

WISDOM, Circuit Judge:

The appellant, A. T. Barrett, Jr., asks this Court to reverse an order of the district court dismissing his complaint and to direct the court to convene a three-judge court to hear his constitutional attack upon the system devised by the State of Texas for awarding development rights to the sulphur underlying its public school lands. We have concluded that the district court should not have reached a decision on the merits, but rather should have abstained. Therefore we reverse the judgment of the district court and remand the case with instructions to dismiss Barrett’s complaint without prejudice.

I.

Barrett is the oil and gas lessee of two sections of public school lands in Culberson County, Texas. Years ago the State of Texas, original owner of the land in question, sold the surface with a reservation of the minerals in the State. In February 1961 the surface owner, acting as agent for the State, in accordance with Vernon’s Ann.Tex.Rev.Civ. Stat.Ann. arts. 5367-79, conveyed an oil and gas lease to Barrett. Barrett went on the land, drilled wells, and discovered oil, but as of May 1969 he had not yet begun full production.

Atlantic Richfield is the successor by merger to Sinclair Oil & Gas Company. In 1967 the State issued a grant to Sinclair to develop the sulphur underlying the same two sections of land in Culber-son County included in Barrett’s oil and gas lease. The award to Sinclair was *40 made under Tex.Rev.Civ.Stat.Ann. arts. 5388-5403 and the mandate of the Texas Supreme Court in Duval Corp. v. Sadler, 407 S.W.2d 493 (Tex.1966). In May 1969 Atlantic Richfield went on the land and drilled a sulphur test well.

Barrett first became aware of Atlantic Richfield’s sulphur operations in June 1969. An inspection of the land revealed that Atlantic Richfield had located its test well almost exactly at a site upon which Barrett had planned to drill an oil well. Moreover, the sulphur well directly offset two of Barrett’s existing oil wells. Upon discovering signs that the sulphur well was also producing oil, Barrett attempted to obtain from Atlantic Richfield data from which he could determine whether and to what extent his oil in place had been produced, damaged, or rendered unrecoverable. Atlantic Richfield declined to supply him with that information. Consequently Barrett filed this lawsuit. 1

Barrett’s original complaint sought to have the district court nullify Atlantic Richfield’s sulphur award and enjoin its drilling operations on the theory that the statutes under which Atlantic Rich-field received its award, Tex.Rev.Civ. Stat.Ann. arts. 5388-5403, were unconstitutional. Barrett alleged two grounds in support of his claim of unconstitutionality: (1) that the State’s award of sulphur rights, which enabled Atlantic Richfield to go on the land and drill its wells, effectively deprives Barrett of his property rights without due process of law in violation of the Fourteenth Amendment, and (2) that the State’s award and Atlantic Richfield’s actions pursuant to that award constitute an impairment of the State’s contractual obligations to Barrett, which is prohibited by Article I, Section 10 of the United States Constitution. Seeking to restrain the operation of these statutes, Barrett moved that the district court convene a three-judge court according to 28 U.S.C. §§ 2281 and 2284 to hear the case. He also filed a motion for leave to amend his original complaint to allege diversity jurisdiction and a cause of action for damages based on Atlantic Richfield’s drilling operations. In response to Barrett’s original complaint Atlantic Rich-field filed motions to dismiss for failure to state a claim upon which relief could be granted and for lack of jurisdiction over the subject matter.

The district court granted Atlantic Richfield’s motions to dismiss. In its written order of dismissal the court concluded that Barrett’s original complaint presented no substantial federal or constitutional question and that Barrett had state administrative remedies available to him that he had not exhausted. The court therefore denied Barrett’s motions for temporary injunctive relief and for convening a three-judge court. The court also denied Barrett’s motion for leave to amend his original complaint to allege diversity jurisdiction.

II.

We have concluded that rather than entering a judgment on the merits, the district court should have invoked the doctrine of abstention and dismissed the complaint without prejudice.

In recent cases the Supreme Court has restated, without material change, its abstention doctrine as set forth in Pullman. 2

*41 Where resolution of the federal constitutional question is dependent upon, or may be materially altered by, the determination of an uncertain issue of state law, abstention may be proper in order to avoid unnecessary friction in federal-state relations, interference with important state functions, tentative decisions on questions of state law, and premature constitutional adjudication.

Harman v. Forssenius, 1965, 380 U.S. 528, 534, 85 S.Ct. 1177, 1182, 14 L.Ed.2d 50, 55. Because, however, abstention involves a certain duplication of effort and expense and attendant delay, the Court has said that the doctrine should be applied “only where ‘the issue of state law is uncertain.’ ” Reetz v. Bozanich, 1970, 397 U.S. 82, 86, 90 S.Ct. 788, 790, 25 L.Ed.2d 68, 72, quoting from Harman v. Forssenius, supra; see also Wisconsin v. Constantineau, 1971, 400 U.S. 433, 91 S.Ct. 507, 27 L.Ed.2d 515, 521. The reasoning behind that rule is clear: if the issue of state law is settled and affords relief to the plaintiff, the federal court itself can apply that law to dispose of the case. Similarly, if the state law issue is settled but affords no relief to the plaintiff, the federal court has no choice but to decide the constitutional questions. In either case abstention would be useless.

This is a particularly appropriate case for an application of the Pullman doctrine for two reasons. First, the resolution of Barrett’s federal constitutional questions is wholly dependent upon, and may be materially altered by, the determination of certain unsettled issues of state law. Compare Harman v. Forssen-ius, supra. The crux of this case concerns the relative rights of the lessee of the oil and gas and the lessee of the sul-phur underlying the same tract when, because of unusual geophysical facts and modern extraction methods, to recover one of the minerals it is necessary also to take or destroy or render unrecoverable the other. Barrett contends that as the lessee “first in time of grant” he is entitled, in these circumstances, to keep Atlantic Richfield off the land entirely or at least to recover damages for the harm that its drilling operations have done to his oil in place.

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444 F.2d 38, 39 Oil & Gas Rep. 101, 1971 U.S. App. LEXIS 10152, Counsel Stack Legal Research, https://law.counselstack.com/opinion/a-t-barrett-jr-v-atlantic-richfield-company-ca5-1971.