Frost Lumber Industries, Inc. v. Federal Petroleum Co.

20 F. Supp. 612, 1937 U.S. Dist. LEXIS 1422
CourtDistrict Court, W.D. Louisiana
DecidedJuly 14, 1937
DocketNo. 694
StatusPublished
Cited by2 cases

This text of 20 F. Supp. 612 (Frost Lumber Industries, Inc. v. Federal Petroleum Co.) is published on Counsel Stack Legal Research, covering District Court, W.D. Louisiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Frost Lumber Industries, Inc. v. Federal Petroleum Co., 20 F. Supp. 612, 1937 U.S. Dist. LEXIS 1422 (W.D. La. 1937).

Opinion

DAWKINS, District Judge.

This suit was commenced in the form known to the Louisiana law as a slander of title action. It alleged that defendant was claiming to own an interest in the minerals under large tracts of land in the parishes of Union, Ouachita, De Soto, Sabine, and Natchitoches, without right or justification. It prayed that defendant be ordered to desist therefrom or that it assert such title as it claimed.

In response, defendant set forth its ownership of an undivided one-half interest in the minerals, based upon certain conveyances, and this had the effect of converting the matter into what is called, under the state practice, a petitory action to try title to real property. As against the title so alleged by defendant, the plaintiff pleaded the prescription of ten years’ liberandi causa, under the provisions of the Louisiana Revised Civil Code (article 3478 et seq.).

There is little or no dispute as to the facts. On January 12, 1917, the- Frost-Johnson Lumber Company and the Union Sawmill Company conveyed to, the defendant’s predecessor in title an undivided one-half interest in the minerals under the lands in question. On the same date a joint operating agreement was entered into for the development of all or any part of the said minerals by any one of the three parties named. In the following October the Union Sawmill Company transferred to the Frost-Johnson Lumber Company all of its lands in the parishes of Union and Ouachita, in fee simple, including those under which the one-half interest in the minerals now claimed by defendant had been conveyed.

On . February 23, 1920, Frost-Johnson Lumber Company, Union Sawmill Company, and Federal Petroleum Company (a Louisiana corporation), jointly* conveyed to Union Power Company all gas and gas rights under the same lands, and another joint operating agreement was entered into between all of the parties, providing that each might develop the properties for their minerals, according to its interest. If gas was produced, it was to be for the account of Union Power Company, and, if other minerals, for the account of the other two parties to the agreement.

Thereafter, on March 31, 1923, the Federal Petroleum Company of Louisiana, which had thus acquired these rights, transferred all of its assets to the Federal Petroleum Company of Delaware, defendant in the present suit, except the gas and gas rights, which had previously been conveyed to the Union Power Company. In the meantime, Federal Petroleum Company (of Louisiana) had acquired by assignment a lease upon 160 acres of land belonging to Emmet Parks, executed by him on September 25, 1916, and on October 22, 1918, it conveyed one-half interest in this lease to Frost-Johnson Lumber Company. Thereafter, the last-mentioned company, on February 11, 1918, purchased from Parks the fee title to 40 acres of this tract, and on August 23d following the remaining 120 acres, so it became the owner of the entire 160 acres upon which the aforesaid lease of September 25, 1916, had been given by Parks. A question having arisen as to whether this lease was still in effect, on June 11, 1926, Frost-Johnson Lumber Company executed an instrument, the purpose of which appears to have been to recognize and acknowledge the rights of Federal Petroleum Company in the Parks lease.

The Interstate Natural Gas Company, Inc., had become the owner of the gas rights under the Parks lands, and it, the Federal Petroleum Company, Union Sawmill Company, and Frost Lumber Industries (plaintiff herein) executed an instrument abandoning and cancefing the Parks lease. This left the title in fee in the Frost Lumber Industries unincumbered by the aforesaid lease.

On February 9, 1928, Frost Lumber Industries conveyed to Federal Petroleum Company, defendant, an undivided one-half interest in all the mineral rights in this same 160 acres, of (Parks) land, except gas.

[614]*614It is admitted that there have been no develo'pments upon the large acreage in controversy in the five parishes, to interrupt the prescription of ten years’ liberandi causa, but it is .strenuously insisted by defendant that the plaintiff, Frost Lumber Industries, Inc., its associates and ancestors in title, have- interrupted prescription by written acknowledgments recognizing the rights of defendants in the- minerals, except gas, under all of said lands.' In support of this .contention, it relies, among other things,- upon the following provisions in the several transfers and resolutions of the boards o,f directors and stockholders of the plaintiff .and its predecessors in title:

(-1) In the sale of October 15, 1917, by -Union Sawmill Company .to Frost-Johnson Lumber Company, of all of the former’s lands in the parishes of Union ■and Ouachita, it was recited: “It is understood and known between the parties hereto that a one-half interest to all the oil, gas and mineral rights on said lands has .-been conveyed to the Federal Petroleum Company, with other reservations and rights made under contract with that Company. It is agreed and understood that all the oil, gas and mineral rights and all its rights under the contract with said Federal Petroleum Company of date January 12th, 1917, are bargained, granted, sold and conveyed hereunder to the said Frost-Johnson Lumber Company by this conveyance.”

■ (2) The transfer on December 23, 1920, by Frost-Johnson Lumber Company, Union Sawmill Company, and Federal Petroleum Company to Union Power Company of all the gas rights under the Parks lease, wherein it was declared:

“Whereas, Grantors collectively are the owners in fee simple of all the oil, gas and other minerals on, in and under a large acreage of land in the States of Arkansas and Louisiana, and are the owners and holders of oil, gas and mineral leases and rights on, in and to certain other lands in said states, in acreage and amounts approximately as follows:—
In Arkansas, mineral rights owned, about — 67,591.34 acres,
In Louisiana, mineral rights owned, about — 180,009.34 acres,
In Louisiana, leases held, about — 3,090.00 acres,

Total — about—250,690.68 acres,- of which oil, gas and minerals, and leases, Federal Petroleum Company is the owner of an undivided one-half (%) interest, and said Frost-Johnson Lumber Company of Missouri, and Union Sawmill Company of Arkansas are the owners of the remaining one-half (%) ihterest; and * *

As of the same date, December 23, 1920, an operating agreement was executed by all four parties, that is, Frost-Johnson Lumber Company,. Union Sawmill Com- , pany,' Federal Petroleum Company, and Union Power Company, providing for the ■ production and development of-the minerals owned by each, respectively.

(3) On June 11, 1926, some question having arisen as to whether the Parks lease on 160 acres of land, ábove referred to, was- still in effect, Frost-Johnson Lumber Company executed an instrument, whereih it was declared as follows: .-

“Now, Therefore, Know All Men by These Presents: That Frost-Johnson.Lumber Company of Missouri, acting herein by and through its duly authorized officers for and in consideration of the premises and the further .sum of $10.00 tq it in hand paid the said Frost-Johnson Lumber Company does by these presents ratify and confirm

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Bluebook (online)
20 F. Supp. 612, 1937 U.S. Dist. LEXIS 1422, Counsel Stack Legal Research, https://law.counselstack.com/opinion/frost-lumber-industries-inc-v-federal-petroleum-co-lawd-1937.