Gulf & Mississippi River Transportation Co. v. BP Oil Pipeline Co.

730 F.3d 484, 2013 WL 5268395, 2013 U.S. App. LEXIS 19281
CourtCourt of Appeals for the Fifth Circuit
DecidedSeptember 18, 2013
Docket12-30741
StatusPublished
Cited by21 cases

This text of 730 F.3d 484 (Gulf & Mississippi River Transportation Co. v. BP Oil Pipeline Co.) 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
Gulf & Mississippi River Transportation Co. v. BP Oil Pipeline Co., 730 F.3d 484, 2013 WL 5268395, 2013 U.S. App. LEXIS 19281 (5th Cir. 2013).

Opinion

*486 JENNIFER WALKER ELROD, Circuit Judge:

This is an action for an accounting of a share of profits allegedly owed to Gulf and Mississippi River Transportation Company (“G & M”) because BP Oil Pipeline Company (“BP”) operated a pumping station on land the companies co-owned. The express servitude that initially allowed for the pumping station expired in 1980. Although negotiations to extend the servitude failed, BP continued to operate the station until 2006. In 2010 G & M sued BP, asserting that it is a co-owner of both the pumping station and the land on which it sits and seeking an accounting for all revenue and profit that BP made from the pumping station. BP moved for summary judgment, contending that the St. Julien Doctrine prescribed G & M’s claim and contesting G & M’s assertion of co-ownership. The district court granted summary judgment for BP. We REVERSE the district court’s judgment and REMAND for further proceedings.

I.

In 1957, G & M acquired a 20% undivided fee interest in a 5.19 acre tract on Grand Terre Island (“the Tract”). A few years later, in 1960, Gulf Refining Company (“Gulf’) obtained a right-of-way servitude (“the Servitude”) from all owners of the Tract “for the purpose of constructing, maintaining and operating thereon a booster pump[ing] station to be used in connection with the transportation by pipe line of oil, gas, water, steam, or any material or substance which can be conveyed through a pipe line.” The Servitude, by its own terms, had a limited duration:

The rights herein granted shall be for a term of 20 years from and after the date hereof, after which term, all of said rights shall cease and terminate. Grantee shall have a period of 90 days after the expiration of this grant in which to remove its property and equipment which may have been placed on [the Tract].

Important to this case, the Servitude did not specify what would happen to the grantee’s “property and equipment” if it remained on the Tract after the ninety-day removal period expired.

The Servitude expired on June 24, 1980, but Gulf continued to operate the pumping station. Three months later, Gulf filed a petition to expropriate a perpetual servitude over the Tract. In its petition, Gulf alleged that it had “undertaken to conduct negotiations in good faith to purchase a right-of-way and servitude over the [Tract] ... and to agree with [the Tract’s owners] as to the term and price of said servitude, but to no avail.” Gulfs petition named G & M as a co-owner of the Tract and served G & M with the petition through its attorney. After that point, however, the expropriation suit essentially stopped in its tracks: G & M did not file any responsive pleadings or discovery materials. Gulf experienced trouble locating and serving other potential defendants, and neither Gulf nor any later operators of the pumping station prosecuted the suit to judgment.

Six years later, in 1986, Gulfs corporate successor, Chevron Pipeline Company (“Chevron”), sold its interest in the pumping station and attendant rights to Sohio Pipeline Company (“Sohio”), the corporate predecessor of BP. The Purchase Agreement for this sale contained a covenant regarding the “Expired Right-of-Way,” which stated:

With respect to the right-of-way granted pursuant to [the Servitude] dated August 12, 1960 by Lloyd Wright, Executor, which has expired pursuant to its terms, [Chevron] shall acquire within twelve (12) months after Closing a fee interest in the servient estate, which was subject to [the Servitude], in a proportion sufficient to secure [Sohio/BP’s] *487 right to continue the present Pipeline occupation....

Chevron fulfilled its obligation under this provision in 1988 when it purchased an undivided 1.5% fee interest in the Tract, which it quickly sold to BP, through So-hio. 1 BP operated the pumping station until 2006, when it sold its interests in the pumping station and the Tract to Plains Pipeline, L.P. (“Plains”). 2 From the time the Servitude expired until the time that Plains purchased BP’s interests, G&M did not receive a single payment for the use of the pumping station.

II.

In April 2010, G&M sued Chevron and BP asserting trespass and accounting claims. G&M contended that (1) Chevron and BP committed a continuing trespass by operating the pumping station from the time the Servitude expired until Plains purchased BP’s interests; and (2) BP owed G & M a share of revenue as a co-owner of the pumping station and the Tract.

Chevron and BP initially moved for summary judgment on G & M’s trespass claims. They contended that, because a co-owner cannot commit trespass, the one-year prescription period for G & M’s trespass claims began to run in 1988 when Chevron (and shortly thereafter BP) acquired the 1.5% interest in the Tract. G & M opposed the motions and moved for partial summary judgment, asserting that it co-owned the pumping station with BP and was therefore entitled to share in the “income, revenue, and/or profits” BP earned during the period of co-ownership from November 1988 to June 2006 (the “Relevant Period”).

The district court granted summary judgment for Chevron and BP on G & M’s trespass claims; it also denied G & M’s cross-motion. Because the trespass claim was the only claim that G&M asserted against Chevron, the district court entered a Rule 54(b) partial final judgment for Chevron. See Fed.R.Civ.P. 54(b). G&M appealed the Rule 54(b) judgment and our court affirmed in an unpublished opinion. Gulf & Miss. River Transp. Co. v. Chevron Pipeline Co., 451 Fed.Appx. 372, 375-76 (5th Cir.2011). In this appeal, G&M does not challenge the district court’s ruling that its trespass claim against BP is prescribed; therefore, the trespass claims are no longer at issue.

After we affirmed the district court’s ruling on the trespass claim against Chevron, BP and G&M filed cross-motions for summary judgment on G & M’s remaining claim for an accounting of all revenue and profit from the pumping station during the Relevant Period. BP asserted that (1) the St. Julien Doctrine barred G & M’s claim because it triggered a two-year prescriptive period, which had lapsed; and (2) even if the St. Julien Doctrine did not apply, G & M was merely a co-owner of the Tract, not the pumping station, so it had no claim for an accounting of profits from the pumping station. G & M, on the other hand, contended that (1) it became a co-owner of the pumping station when the station remained on the Tract past the ninety-day removal period specified in the Servitude; and (2) even if it is not a co-owner of the pumping station, it is entitled to an accounting of the revenues from the pumping station because it sits on the *488 Tract in which G & M holds an undivided 20% fee interest.

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Cite This Page — Counsel Stack

Bluebook (online)
730 F.3d 484, 2013 WL 5268395, 2013 U.S. App. LEXIS 19281, Counsel Stack Legal Research, https://law.counselstack.com/opinion/gulf-mississippi-river-transportation-co-v-bp-oil-pipeline-co-ca5-2013.