Brigham Oil & Gas, L.P. v. Lario Oil & Gas Co.

2011 ND 154, 801 N.W.2d 677
CourtNorth Dakota Supreme Court
DecidedAugust 15, 2011
DocketNos. 20100211, 20110016
StatusPublished
Cited by20 cases

This text of 2011 ND 154 (Brigham Oil & Gas, L.P. v. Lario Oil & Gas Co.) is published on Counsel Stack Legal Research, covering North Dakota Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Brigham Oil & Gas, L.P. v. Lario Oil & Gas Co., 2011 ND 154, 801 N.W.2d 677 (N.D. 2011).

Opinion

VANDE WALLE, Chief Justice.

[¶ 1] Brigham Oil and Gas, L.P. (“Brigham”), appealed from a partial judgment dismissing its action against Lario Oil & Gas Company (“Lario”) and Murex Petroleum Corporation (“Murex”) seeking oil and gas production payments based on a claimed leasehold interest in certain mineral acres in Mountrail County. The Triple T, Inc. (“Triple”), and Christine Thompson, as sole trustee of the Navarro 2009 Living Trust Agreement, appealed from an order denying their motions to intervene and to vacate the judgment. We conclude the district court did not err in ruling as a matter of law that Brigham had no leasehold interest in the claimed mineral acres. We further conclude the court did not err in denying Triple and Thompson’s motions. We affirm.

I

[¶ 2] In 1989 Helen Testerman, a California resident, executed a will devising her “share of the Mineral Rights in North Dakota to my nephew, John H. Avery.” Testerman also devised property to her children, Monte C. Testerman and Colleen D. Pando, and to her niece, Georgette O. Navarro. Testerman subsequently inherited additional mineral rights in Mountrail County from her brother when he died in 1996, and the ownership of these mineral rights is the subject of this lawsuit.

[¶ 3] Testerman died on January 28, 2004, and Pando filed a petition in a California court seeking to admit the will to probate and requesting that she be appointed executor of Testerman’s estate. In May 2004, the California probate court appointed Pando executor and authorized independent administration of the estate. On April 6, 2005, Pando filed a final inventory and appraisal with the probate court, but the inventory and appraisal did not expressly mention any North Dakota mineral rights. On April 11, 2005, Pando filed with the probate court a “Petition for Final Distribution on Waiver of Accounting, Allowance of Executrix’s Commission, Allowance of Statutory Attorney’s Fees, and Report of Executrix” along with waivers of the filing and settlement of the final account signed by Avery, Monte Testerman, and Navarro.

[¶ 4] On May 4, 2005, Navarro wrote a letter to Pando and Pando’s attorney stating she had a copy of the 1997 personal representative’s deed of distribution of the additional mineral rights from Testerman’s brother’s estate and asserting that Tester-man had written on the top of the deed: “these mineral rights go to Georgette Navarro by Helen Testerman.” In the letter Navarro said “[sjince my aunt clearly intended the most recent mineral rights to go to me, how is this being handled?” At that time Navarro took no further action concerning Testerman’s alleged handwritten comments on the top of the deed.

[¶ 5] On June 17, 2005, the California probate court issued an “Order on Petition of Final Distribution on Waiver of Accounting” approving the petition and ordering that the “administration of the estate is brought to a close.” The order distributed “mineral rights in North Dakota” to Avery, $6,000 to Navarro, and the residue of the estate equally to Pando and Monte Testerman. On August 25, 2007, Avery entered into an oil and gas lease with the Dublin Company (“Dublin”) covering the subject property and other lands located in Mountrail County. The lease was recorded on September 5, 2007, with the Mountrail County Clerk and Recorder. [681]*681Dublin subsequently assigned this lease to Lario.

[¶ 6] On July 10, 2008, more than three years after the California probate court issued its final order distributing Tester-man’s estate, Pando filed in Mountrail County district court an application for informal probate of Testerman’s estate and sought appointment as personal representative, which was granted. On September 16, 2008, Avery filed a petition with the Mountrail County district court seeking an order distributing Testerman’s “mineral rights in North Dakota” in accordance with the June 2005 California probate court order of final distribution. On September 18, 2008, Navarro filed with the California probate court a motion for an order to set aside the prior order of final distribution contending the failure of the court to consider Testerman’s alleged handwritten directive, or “holographic codicil,” was the result of “extrinsic fraud or mistake.” Navarro asked the court to issue a revised order distributing the subject property in accordance with Testerman’s handwritten directive. Navarro claimed she did not act earlier because she relied on statements of Pando’s attorney that the handwritten directive “did not count.” On September 29, 2008, Navarro filed with the Mountrail County district court a petition for an order restraining the personal representative and an objection to the petition for an order distributing estate property, claiming no estate property should be conveyed in North Dakota until the California probate court resolved her pending motion to set aside the order of final distribution. On October 15, 2008, Navarro filed with the California probate court a supplement to her motion containing additional materials in support of her claim.

[¶ 7] On October 21, 2008, Navarro entered into an oil and gas lease with Triple covering the subject property “and other lands” located in Mountrail County. This lease was recorded on October 31, 2008, and Triple subsequently assigned an 80 percent net revenue interest in the lease to Brigham.

[¶ 8] On November 5 and 18, 2008, Avery and Navarro executed an agreement which purported to resolve the issue over ownership of the Mountrail County mineral rights. Avery and Navarro stipulated that Avery would receive 100% of the mineral interests Testerman had inherited from her father, and Avery would receive 25% and Navarro would receive 75% of the mineral interests Testerman inherited from her brother, which is the property at issue in this case. Avery and Navarro did not provide notice of the agreement to Dublin, Triple, Brigham or Lario, and those companies were not parties to the agreement. As a result of the agreement, the California probate court did not adjudicate the validity of Testerman’s alleged “holographic codicil.” The California probate court record lists the matter as “settled,” and Navarro’s motion was taken off the court’s calendar on January 8, 2009.

[¶ 9] On November 4, 2008, Pando, as personal representative of Testerman’s estate, executed deeds of distribution conveying Testerman’s interest in the subject property to Avery and Navarro in the percentages set forth in their agreement. The deeds were recorded on December 12, 2008. The agreement was also filed with the Mountrail County district court in counterparts on November 24 and December 5, 2008.

[¶ 10] In June 2009, Brigham commenced this action against Lario and Mu-rex. Brigham alleged that it is entitled to a percentage of the production from the subject mineral acres through the oil and gas lease executed by Navarro in October 2008, that Lario was wrongfully claiming Brigham’s interest in the property through [682]*682the oil and gas lease executed by Avery in August 2007, and that Murex was wrongfully withholding production payments from Brigham relating to wells located on the subject property. Lario alleged that its oil and gas lease with Avery covered the subject mineral interests and counterclaimed against Brigham for slander of title. Lario also filed third-party complaints against Navarro and Avery for slander of title and breach of warranty. Brigham and Lario both moved for summary judgment.

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Cite This Page — Counsel Stack

Bluebook (online)
2011 ND 154, 801 N.W.2d 677, Counsel Stack Legal Research, https://law.counselstack.com/opinion/brigham-oil-gas-lp-v-lario-oil-gas-co-nd-2011.