Butt v. Vermejo Park Corp.

556 P.2d 835, 89 N.M. 679
CourtNew Mexico Supreme Court
DecidedNovember 15, 1976
DocketNo. 10613
StatusPublished
Cited by1 cases

This text of 556 P.2d 835 (Butt v. Vermejo Park Corp.) is published on Counsel Stack Legal Research, covering New Mexico Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Butt v. Vermejo Park Corp., 556 P.2d 835, 89 N.M. 679 (N.M. 1976).

Opinion

OPINION

OMAN, Chief Justice.

This appeal arises from a suit to foreclose claimed liens for work done and materials furnished pursuant to our Mechanics’ and Materialmen’s Lien Act (Meehanics’ Act) [§§ 61-2-1 to 61-2-17, N.M.S.A. 1953 (Repl. Vol. 9, pt. 1, 1974)], and our Oil and Gas Lien Act (Oil Act) [§§ 65 — 5— 1 to 65-5-15, N.M.S.A.1953 (2d Repl. Vol. 9, pt. 2, 1972)]. Plaintiffs (Butt Bros.) claimed that a lien attached to the-“fee estate under the Mechanics’ Act and to a leasehold estate in the same lands under the Oil Act, even though by judicial decree the leasehold estate had terminated more than six months prior to the filing of the claim of liens.

We are concerned on this appeal only with the disputes between Butt Bros, and Vermejo Park Corporation (Vermejo). The district court entered summary judgment in favor of Vermejo and Butt Bros, have appealed. We affirm.

The pertinent facts arc:

(1) W. S. Ranch Company was the fee owner of the lands in question. On about March 8, 1972, it leased these lands to Odessa Natural Corporation (Odessa), for purposes of exploration and drilling for oil and gas, operation of and production from oil and gas wells, and owning, treating, storing and selling oil and gas produced therefrom. The lessor reserved the right to occupy and use the lands for its ranching and other purposes, and reserved all other rights therein not inconsistent with the rights granted to lessee.

(2) Some time after March 8, 1972, W. S. Ranch Company conveyed the fee estate in the lands to Vermejo.

(3) On May 11, 1973, Odessa entered into a “Farmout Agreement” with American Fuels Corporation (American), whereby American was to explore and drill for oil and gas on the leased premises.

(4) On about February 18, 1974, American and Butt Bros, entered into a contract whereby Butt Bros, were to build roads, level land, haul water, provide gravel and load pipe for American in connection with its exploration and drilling. The work by Butt Bros, under this agreement was performed during the period from February 18, 1974 to September 28, 1974.

(5) In another case in the same district court in which the present case originated, Vermejo brought suit against American and Odessa. A judgment was entered on October 30, 1974, declaring and decreeing that the oil and gas lease of March 8, 1972 and the Farmout Agreement of May 11, 1973, referred to above in ¶¶ 1 and 3, were terminated at midnight on May 16, 1974, and awarding Vermejo possession of all the lands unencumbered by any claim of right, title or interest of any nature whatsoever by American and Odessa.

(6) The claim of liens upon which Butt Bros, brought the present suit to recover $6,233.70, plus costs and attorneys fees, was filed on November 26, 1974. The present suit, by which Butt Bros, sought to foreclose these claimed liens in order to recover the said amount, plus the costs and attorneys fees, was filed on December 20, 1974.

The first issue to be resolved is whether Butt Bros, acquired an enforceable lien against the fee owned by Vermejo under the Mechanics’ Act and particularly under §§ 61-2-2 and 10 thereof, for the labor and materials furnished pursuant to their contract of February 18, 1974 with American as referred to above in ]f 4. Butt Bros, claimed a lien under this act but Vermejo contended that the only lien they could possibly have acquired was one under the Oil Act. The district court resolved this in favor of Vermejo.

Butt Bros, base their claim that they can properly assert a lien under either or both the Mechanics’ Act and the Oil Act upon the following provisions of § 65-5-15 of the Oil Act, which became effective February 28, 1931:

“This act [65-5-1 to 65-5-15] shall not in any way affect, modify or repeal chapter 82 of the T929 New Mexico Statutes Annotated’ [the Mechanics’ Act, which is substantially the same as chapter 82 of the 1929 New Mexico Statutes Annotated]. All other laws in conflict with the provisions of this act are hereby repealed.”

The argument of Butt Bros, is (1) that this expresses a clear legislative intent that the lien provisions of the Oil Act were not in any way to affect, modify or repeal the provisions of § 61-2-10 of the Mechanics’ Act; (2) that every improvement mentioned in § 61-2-2 of the Mechanics’ Act constructed upon any lands with the knowledge of the owner thereof shall be held to have been constructed at the instance of the owner; and (3) that the interest of the owner shall be subject to any lien filed pursuant to the provisions of the Mechanics’ Act.

Verme jo counters with the argument that while the contentions of Butt Bros, are “theoretically appealing ■ * * * such an academic analysis ignores the practicalities” of what was intended to be and what was in fact accomplished by the Oil Act. It argues that § 61-2-10 of the Mechanics’ Act and § 65-5-1 of the Oil Act clearly conflict with each other, and a literal reading and application of the above-quoted language from § 65-5-15 of the Oil Act would necessarily have rendered much of the Oil Act surplusage and of no effect immediately upon its passage. We agree. If the Legislature had intended merely to broaden the scope of the attachable items for lien claimants in the oil and gas industry, it could easily have done so by amending the Mechanics’ Act. Instead, it chose to enact a new and comprehensive act covering liens only in the oil and gas industry.

Under the Mechanics’ Act, a lien may be imposed upon the fee owner’s interest if he has knowledge of the construction and fails to disclaim responsibility therefor in the manner and within the time therein provided. Under the Oil Act, the fee owner’s interest is subject to a lien only if he expressly so contracts. Obviously there is a conflict, if in fact both acts apply. A mere reading and comparison of the titles of the two acts clearly demonstrate that there are other areas of conflict, duplication and overlapping, if in fact conduct giving lien rights under the Oil Act were also intended to give lien rights under the Mechanics’ Act.

The reasoning of the Supreme Court of Texas in Ball v. Davis, 118 Tex. 534, 18 S.W.2d 1063 (1929), when faced with a problem of construction very similar to the one presented here, is persuasive and appeals to us. In that case, the question was whether a right to a lien under the Oil Industry Lien Act of that state could also be asserted under other lien acts establishing rights to liens of materialmen, artisans, laborers and mechanics. Because a provision in the Texas statutes provided that the rights and remedies created in the Oil Industry Act should be cumulative as to rights and remedies under other lien laws, the Court of Civil Appeals held that those entitled to liens under the Oil Industry Lien Act could also look to other lien laws for their lien remedies.

In disagreeing with the holding of the Court of Civil Appeals, the Supreme Court of Texas stated:

“ * * * [by the Oil Industry Lien Act] materialmen, artisans, laborers, and mechanics, for certain services, are authorized to fix liens against certain properties for specified services.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Cite This Page — Counsel Stack

Bluebook (online)
556 P.2d 835, 89 N.M. 679, Counsel Stack Legal Research, https://law.counselstack.com/opinion/butt-v-vermejo-park-corp-nm-1976.