H. & H. Transp. Co. v. Owens

39 So. 2d 441, 214 La. 985, 1949 La. LEXIS 903
CourtSupreme Court of Louisiana
DecidedFebruary 14, 1949
DocketNo. 38582.
StatusPublished
Cited by3 cases

This text of 39 So. 2d 441 (H. & H. Transp. Co. v. Owens) is published on Counsel Stack Legal Research, covering Supreme Court of Louisiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
H. & H. Transp. Co. v. Owens, 39 So. 2d 441, 214 La. 985, 1949 La. LEXIS 903 (La. 1949).

Opinions

MOISE, Justice.

This litigation is over the proceeds realized from a sheriff’s sale of a drilling rig and equipment formerly owned by the defendant, H. C. Owens.

On April 30, 1945, H. C. Owens purchased a drilling rig on terms of credit from Jim McMurrey, intervenor and third opponent. For the purchase price of the rig, Owens executed three promissory notes, each for $5,416.67, dated April 30, 1945, secured by a vendor’s lien a<nd chattel mortgage on the property described as follows: “One 112 foot Parkersburg Steel Drilling Derrick with steel substructure, together with one Rotary Drilling Rig complete.” (The derrick was not delivered and an adjustment was subsequently made.) In this act there is the following in relation to the location of the rig: “The property described presently within the Parish of Catahoula, Louisiana, is to be located and employed by the purchaser in the Parish of Claiborne, Louisiana.” This act was recorded in Claiborne Parish, La., on the following day, May 1, 1945.

Two wells were drilled by the defendant in Claiborne Parish, Creighton No. 1 and *989 Muslow No. 1. Creighton No. 1 was begun sometime in May, 1945, and was abandoned as a dry hole about the end of October, 1945. The rig was then moved to the second location, a little more than a mile away, and the drilling of Muslow No. 1 was started sometime after November 1, 1945. This well was also abandoned as a dry hole after February 9, 1946.

In drilling Creighton No. 1, Owens bought materials and supplies from intervenor and third opponent, International Derrick and Equipment Company, amounting to $14,626.30. More than ninety days elapsed from the date of this company’s last invoice for supplies to Creighton No. 1 and the filing of its lien on March 8, 1946. No other creditor here involved furnished services, supplies or materials for this first well.

In connection with the drilling of Mus-low No. 1, International Derrick and Equipment Co. furnished materials and supplies amounting to $89.56; H. & H. Transportation Co. (plaintiff) furnished services amounting'to $3,300.32; Tri-State Drilling Mud Service (intervenor) furnished materials and supplies amounting to $1,023.13; and Mid Continent Supply Co. (intervenor) furnished materials and supplies amounting to $2,240.67. Material-men’s liens - were filed within 90 days of last delivery to Mu slow No. 1 by these four ■companies.

H. & H. Transportation Co., Inc., brought this suit to .enforce payment of its claim. obtained judgment and proceeded to execution. The intervening creditors opposed this execution by way of third opposition. Owens did not defend the suit. The property subject to the lien was sold at judicial sale and $7,375 was realized thereon. The contest is between the creditors as to the distribution of this amount.

Three of the creditors, namely, the H. & H. Transportation Company, Inc. (plaintiff), Tri-State Drilling Mud Service, and Mid Continent Supply Company (intervenors and third opponents), have recognized the equality of rank of their respective claims and are urging their objections to claims made by intervenors and third opponents Jim McMurrey and International Derrick and Equipment Company. Mc-Murrey is claiming priority over plaintiff as well as intervenors on the basis of a vendor’s lien embraced within the act of mortgage, describing the property as set out above. The International Derrick & Equipment Co. claims that the filing of its lien within ninety (90) days of the last delivery to Muslow No. 1 covered its claim also for materials furnished Creighton No. 1, since both wells were in the same field, were successively drilled, and the furnishing of supplies constituted a continuous transaction.

The trial court recognized the superiority of McMurrey’s vendor's lien and ordered that the proceeds from the sale of a portion of the property, separately appraised and. sold as being subject to said lien, be p?.ií *991 to McMurrey. Plaintiff and the other intervenors and third opponents have appealed. McMurrey has answered the appeal, asking that the judgment be amended to assess plaintiff with the costs of court, and as thus amended, that the judgment be affirmed.

The materialmen claim by virtue of the provisions of Act No. 68 of 1942, which provides for liens in favor of laborers and furnishers of supplies for labor done and supplies furnished in connection with the drilling of oil, gas and water wells. On this subject the pertinent provisions of Act No. 145 of 1934 (later amended by Act 100 of 1940 and Act No. 68 of 1942) read as follows:

“ * * * such lien and privilege shall be superior to all other liens and privileges or mortgages against said property, except taxes or a bona fide vendor’s lien and privilege, provided such vendor’s lien and privilege exists and is recorded before the work, label, service, trucking, towing, barging, repairing, or the furnishing of fuel, drilling rigs, standard rigs, material or supplies is begun.”

The district judge foxind that Act No. 68 of 1942 omitted in Section 2 of the general provisions “provided such vendor’s lien and privilege exists and is recorded before the"w'ork, labor, service,- 'trucking, towing, barging; repairing, or the furnishing- of fuel, drilling rigs, standard rigs, material or supplies is begun”, and in lieu of this broad provision requiring recordation of the vendor’s lien, the following section was added:

“Section 2-B. That as to movable property said vendor’s lien and privilege must exist and be filed for record within seven days after said property, subject to the vendor’s lien and privilege, is delivered to the well or wells. Said vendor’s lien and privilege shall be evidenced by a written instrument signed by the purchaser and when authentic in form or duly acknowledged, shall be filed for record in the records of the parish where the well or wells is located. The effect of -said filing shall prevent said movables from becoming immovable by nature or destination. The property shall be described in such a manner as to be reasonably subject to identification and the premises on which the property is located or is to be located shall be stated. Filing, recordation and preservation shall be in the same manner and form and in the same book as now provided for the recordation of chattel mortgages, but the recorder shall enter under the heading ‘Remarks’ the words, ‘Vendor’s Lien.’”

The district judge held that Act No. 68 of 1942 did not contemplate nor did it require recordation of a vendor’s lien coverixig the sale of an entire drilling rig which is moved into a parish for the drilling of wells and that it contemplated only the furnishing of supplies to a well already commenced. We concur with the findings of the trial court.

*993 If the recordation of a vendor’s lien covering an entire drilling rig is not clearly required by Act No. 68 of 1942 then there is no requirement in any such statute for recordation.

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Bluebook (online)
39 So. 2d 441, 214 La. 985, 1949 La. LEXIS 903, Counsel Stack Legal Research, https://law.counselstack.com/opinion/h-h-transp-co-v-owens-la-1949.