Burger Drilling Company, Inc. v. Ralph Bauman, Individually and D/B/A Bauman Oil and Gas Properties

643 F.2d 240, 69 Oil & Gas Rep. 511, 1981 U.S. App. LEXIS 14115
CourtCourt of Appeals for the Fifth Circuit
DecidedApril 20, 1981
Docket79-3928
StatusPublished
Cited by1 cases

This text of 643 F.2d 240 (Burger Drilling Company, Inc. v. Ralph Bauman, Individually and D/B/A Bauman Oil and Gas Properties) 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
Burger Drilling Company, Inc. v. Ralph Bauman, Individually and D/B/A Bauman Oil and Gas Properties, 643 F.2d 240, 69 Oil & Gas Rep. 511, 1981 U.S. App. LEXIS 14115 (5th Cir. 1981).

Opinion

HUNTER, District Judge:

This appeal challenges the district court’s judgment in favor of plaintiff and against defendant in the amount of $122,861.00, which was entered on the basis of answers by the jury to special questions submitted to the jury under the special verdict procedure prescribed by Rule 49(a) of the Federal Rules of Civil Procedure. We affirm.

An abridged version of the facts will suffice for a consideration of the arguments. Burger Drilling brought this suit against Bauman Oil, alleging that Bauman owed it additional compensation for performance of services pursuant to a drilling contract between the parties. The contract provided that Burger would drill an oil and gas well for Bauman on a lease owned and operated by Bauman. Burger was obligated to perform the work diligently, in a good and workmanlike manner. Underlying Bauman’s argument is that the operations as a general proposition were to be conducted at contractor’s risk. However, there were exceptions where a “loss of circulation” developed. These exceptions are found in Paragraphs 11 and 12 of the contract:

11. That in the event circulation of drilling fluid or mud is lost, the Contractor shall attempt to regain circulation, *241 provided, however, that Owner shall pay to Contractor regular day work as provided for all time spent by Contractor.
12. That while day work is being performed by Contractor under the direction, supervision or control of Owner or his representatives, such work shall be at the risk of Owner, and Owner shall pay Contractor the day work rates herein specified for the time spent on a fishing job or for recovery of drill pipe that has become stuck in the performance of such day work, provided that Owner, at his option, may order Contractor to cease such fishing operations or such efforts to recover stuck drill pipe by reimbursing Contractor for the cost of all drill pipe and other equipment owned by Contractor then in the hole and not recovered and Contractor shall immediately proceed to whip-stock the hole or plug and abandon said hole, as ordered by Owner for which work the Owner shall pay Contractor the day work rates specified.

Burger commenced drilling on the 31st day of December, 1977, and by January 8, 1978, had reached a depth of 4,757 feet. No problems had been encountered and Bauman instructed Burger to drill a rathole of an additional 100 feet. He was in the process of doing so when he lost circulation on the well. 1 Burger’s employees proceeded to manipulate the pipe in an endeavor to pull the drill bit from the bottom. The pipe broke. Third parties were employed to pull the remainder of the pipe out of the hole (fishing operation). By statement dated February 15,1978, Burger charged Bauman the normal drilling rates, and in addition charged him for day rates and third party expenses incurred while the fishing operation was being conducted. Bauman disputed this bill, and paid only the part that related to the normal footage charge, refusing to pay the day rate due to fishing and the third party expenses incurred in the fishing operation. 2 This suit was instituted to recover .these additional expenses.

Bauman discusses at length the conflicting evidence on the issues presented, but cannot plausibly dispute that there was sufficient evidence to sustain the jury findings. These findings may be summarized:

(1) Burger performed its services diligently, in a good and workmanlike manner.
(2) Burger lost circulation while drilling on January 8, 1978.
(3) Burger did not regain circulation before the drill pipe in the well became stuck on January 8, 1978.
(4) Burger did not fail to exercise ordinary care to operate its drilling equipment in such a manner as to avoid getting its drill pipe stuck on January 8, 1978.
(5) Burger was not operating with a defective weight indicator at the time the drill pipe separated.
(9) Burger did not use more force than was reasonably necessary in the exercise of ordinary care at the time and under the circumstances then existing while it was trying to free its drilling equipment.
(11) Burger was using defective drill pipe in the drilling of the Cross No. 1 Well at the time the pipe got stuck.
(12) Burger did not know, or in the exercise of ordinary care should not have *242 known, that it was using defective drill pipe in the drilling of the Cross No. 1 Well.

A 13th interrogatory was submitted, which read:

Do you find from a preponderance of the evidence that the use of such defective pipe, as you may have found in answer to the two preceding questions, was a proximate cause of the separation of the drill pipe and the fishing operations on the occasion in question?

The jury did not respond to the 13th interrogatory because it was instructed to do so only if the response to Interrogatory No. 12 was in the affirmative.

The jury returned its verdict on January 24, 1979. Defendant filed post-verdict motions. Due to illness, Judge Brewster was unable to hear arguments until November 1, 1979, at which time all post-verdict motions were denied, and judgment was entered. The essence of appellant’s argument centers on the jury’s answer to Interrogatory No. 11. On that issue the jury determined that Burger was using defective drill pipe. However, in the following question the jury was asked:

“Question No. 12:”
“Do you find from a preponderance of the evidence that Burger Drilling Company, Inc. knew, or in the exercise of ordinary care should have known, that it was using defective drill pipe, if you have found that it was defective, in the drilling of the Cross No. 1 Well on the occasion inquired about in Question No. 11?”

It responded:

“We do not so find.”

Bauman insists that the finding of defective drill pipe entitles him to a judgment as a matter of law under the contract, or in the alternative that the district court was required to make a finding of proximate cause and then enter judgment in his favor. Bauman’s argument that a finding of defective pipe entitled him to a judgment as a matter of law is premised upon assumptions that the additional costs were “unforeseen” and that Burger assumed all risk of loss under the contract. We read the plain language of the contract quite differently. The parties foresaw the possibility of losing circulation and incorporated specific provisions into the contract regarding this precise situation. In its verdict, the jury determined that Burger performed its services diligently and in a good and workmanlike manner.

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Bluebook (online)
643 F.2d 240, 69 Oil & Gas Rep. 511, 1981 U.S. App. LEXIS 14115, Counsel Stack Legal Research, https://law.counselstack.com/opinion/burger-drilling-company-inc-v-ralph-bauman-individually-and-dba-ca5-1981.