Humble Oil & Refining Co. v. Rankin

42 So. 2d 414, 207 Miss. 402, 1949 Miss. LEXIS 350
CourtMississippi Supreme Court
DecidedOctober 24, 1949
DocketNo. 37209.
StatusPublished
Cited by8 cases

This text of 42 So. 2d 414 (Humble Oil & Refining Co. v. Rankin) is published on Counsel Stack Legal Research, covering Mississippi Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Humble Oil & Refining Co. v. Rankin, 42 So. 2d 414, 207 Miss. 402, 1949 Miss. LEXIS 350 (Mich. 1949).

Opinion

*407 Hall, J.

On March 12, 1947 appellant filed a bill of complaint against the appellees alleging that it held a valid oil, gas and mineral lease, dated October 29, 1941, for a primary term of five years and as long thereafter as oil, gas or other mineral is produced from the land therein described or land which is pooled therewith. The lease is on one of the forms in general use in this state and identified as Producers 88 (Rev. 11-39) with Pooling Provision. It provides that the lessee is given the right and power to pool or combine the acreage therein covered, or any portion thereof, with other land in the immediate vicinity thereof, in a unit or units not exceeding 40 acres each. It further provides that if gas is discovered the. lessors shall receive a royalty of one-eighth of the amount realized from the sale thereof, but if the gas is not ufeed. or *408 sold the lessor may pay as royalty $100.00 per well per year, in which event it will be considered that gas is being produced within the meaning of the lease so as to continue it in forcé beyond the primary term so long as said $100.00 per year is paid upon a “shut-in” gas well.

The bill alleges that the original lease covered 11 acres of land but that by instruments subsequently executed by appellees during the primary term of five years the description was changed so as to cover 35.9 acres, and that by other instruments executed by appellees during the primary term of the original lease, with the change in the description of land, was ratified by the appellees. It further alleges that some of the appellees conveyed fractional nonparticipating royalty interests to E. D. Mc-Mahan, who is named as a defendant to the bill.

The bill further charges that on August 6, 1946, the appellant pooled 15 acres of the appellees’ said 35.9 acres with 25 acres of adjoining land owned by M. R. Smith and others upon which it also held a lease, and that it began the drilling of a well on the 25 acres of Smith land while the leases were in force and effect and completed a gas well capable- of producing gas in paying quantities on or about November 5, 1946, but because of the absence of available pipe lines there was no immediate market for the gas from said well and it was immediately shut in to prevent waste. The bill then charges that under the provisions of the lease appellant is given the right to pay as royalty $100.00 per year per well and that upon payment thereof it will be considered that gas is being produced within the meaning of the lease, as a consequence of which the lease will, of course, be continued in effect beyond October 29, 1946, the date of expiration of its primary term.

The bill also alleges that appellant has made investigation to determine the persons entitled to said royalty and the proportions thereof to which each is entitled, *409 but that the appellees are not in agreement among themselves as to which of them is entitled to receive said royalty, nor as to the proportions to which they are entitled, and that appellant should not be required to decide at its own peril as to which have the better rights; that it believes and charges that it may be required to pay greater sums than the actual fixed amount of the debt thus owed by it and that it may further be vexed with numerous suits by those claiming said debt or a part of it; that it has no interest in the whole matter beyond paying the debt to whom it is due and has no preference as between the various claimants and occupies a position equivalent to that of a naked trustee or stakeholder with respect to said $100.00; that the contest involved is not a contest between appellant and appellees, but is a contest only between the appellees themselves with none of whom appellant is in collusion.

The $100.00 was tendered into court and the bill prays for process for appellees requiring them to appear and assert whatever claim they might have thereto and for a discharge and acquittal of appellant, and that the court then determine as between the various appellees who is entitled to said money and in what proportion. The bill also prays for general relief.

Some of the original defendants appeared and filed separate answers to the bill, denying that it is a strict bill of interpleader and averring that it was filed for the purpose of adjudicating title, that there was no development on said property within the primary term of the lease, and that consequently the lease has no life, force or effect. The answers deny that there was a valid unitization of 15 acres of appellees’ land with 25 acres of the Smith land, and deny that their land was thereby held under lease beyond its primary term, and deny that the $100.00 “shut-in” royalty is payable to them, deny that appellant has no interest in the matter beyond paying the debt, deny that it is a naked trustee or stakeholder, *410 deny that there is no contest between appellant and ap-: pellees, and allege that the suit is merely a fraudulent attempt to hold the lease beyond its primary term without complying with the terms thereof. With the answers they filed cross-bills alleging that the lease has expired and that the attempted unitization of a portion thereof with a portion of the Smith property did not effectually extend it beyond its primary term; that the appellant has drilled a producing oil well on lands adjoining those described in the lease which is draining oil from beneath the lands of appellees arid that appellant has breached its obligation to drill an off-set well upon their lands. The cross-bills ■ prayed for a cancellation of all right, title and interest".of appellant in the lands in question, and, in the alternative, that appellant be required to drill an off-set well upon appellees’ lands, and, in the further alternative, that the operation of the oil well on the adjacent land be enjoined, and, in the further alternative, that damages on account of the alleged drainage be awarded to appellees."

Appellant answered the cross-bills in detail, and, in addition, filed demurrers thereto. Before a hearing on the demurrers appellant amended its original bill by tendering into court an additional $100.00 as shut-in royalty on the gas well for the second year. The chancellor overruled the appellant’s demurrers to the cross-bills and granted an appeal to settle all the controlling principles of the case.

Some members of this Court are of the opinion that the appeal was improperly granted, for the reason that it cannot settle all the controlling principles of the case, and that consequently the appeal should be dismissed, but, since the appellant makes no contention that the cross-bills do not state a cause for relief and confines its argument solely to the question that the bill of complaint is a strict bill of interpleader and that no cross-bill cari in any event be filed by the defendants therein named, there *411 by making this the only principle involved in the case at this time, we have concluded to entertain the appeal and decide the question.

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Cite This Page — Counsel Stack

Bluebook (online)
42 So. 2d 414, 207 Miss. 402, 1949 Miss. LEXIS 350, Counsel Stack Legal Research, https://law.counselstack.com/opinion/humble-oil-refining-co-v-rankin-miss-1949.