J.P. Furlong Enterprises, Inc. v. Sun Exploration & Production Co.

423 N.W.2d 130, 99 Oil & Gas Rep. 393, 1988 N.D. LEXIS 91, 1988 WL 35004
CourtNorth Dakota Supreme Court
DecidedApril 18, 1988
DocketCiv. 870075
StatusPublished
Cited by39 cases

This text of 423 N.W.2d 130 (J.P. Furlong Enterprises, Inc. v. Sun Exploration & Production Co.) is published on Counsel Stack Legal Research, covering North Dakota Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
J.P. Furlong Enterprises, Inc. v. Sun Exploration & Production Co., 423 N.W.2d 130, 99 Oil & Gas Rep. 393, 1988 N.D. LEXIS 91, 1988 WL 35004 (N.D. 1988).

Opinion

MESCHKE, Justice.

We consider whether a man-made change in the course of the navigable Missouri River affects ownership of oil and gas underlying the former riverbed. Applying a statute derived from Napoleonic and Roman law through the Field Code, we hold that it does. Therefore, we reverse a summary judgment declining to apply the statute.

FACTS

In 1957, the United States of America acquired land by eminent domain in section 15, Township 152, Range 103, McKenzie County, from Emery Papineau. The condemnation decree stipulated that Papineau retained “all oil and gas rights.”

After acquiring the land, the U.S. Corps of Engineers dug a large trench through section 15. The navigable Missouri River formed a new channel through the trench, leaving a long oxbow of former riverbed north of the new channel. Part of that oxbow is located in the NE'A of section 9 of the same township.

Ladd Petroleum Corporation obtained an oil and gas lease, dated August 9, 1983, from the State of North Dakota for the oxbow riverbed in section 9. Sun Exploration and Production Company obtained an oil and gas lease, dated October 5, 1982, from Grace M. Oyloe on related lands adjoining the oxbow in section 9.

The oxbow riverbed in section 9 was also leased by Marc A. Chomey on September 16,1983 from David A. Papineau as successor in interest of Emery Papineau. Chor-ney assigned this lease to J.P. Furlong Enterprises, Inc. and Nantasket Petroleum Corporation.

In November 1985, Sun drilled a producing oil and gas well in the NE 1 /» of section 9.

THIS LITIGATION

Following completion of the oil well, Furlong, Nantasket, and Papineau (“Furlong plaintiffs”) began this quiet title action against Sun, Ladd, Oyloes, State of North Dakota and several other associated mineral and royalty owners (“Sun defendants”). The Furlong plaintiffs claimed ownership of the oil and gas under the oxbow riverbed in section 9 and contended that the state owned the oil and gas beneath the new channel in section 15 on the basis of NDCC 47-06-07, which says:

“Ancient stream bed taken by owners of new course as indemnity. — 1 f a stream, navigable or not navigable, forms a new course abandoning its ancient bed, the owners of the land newly occupied take by way of indemnity the ancient bed abandoned, each in proportion to the land of which he has been deprived.”

The Sun defendants took the position that NDCC 47-06-07 did not apply to artificial changes in the course of a navigable river and did not apply to the oxbow riverbed which still contained water. After preliminary discovery and motions, the trial court apparently declined to apply the statute, dismissed the Furlong complaint, and granted summary judgment to the Sun defendants.

*132 The Furlong plaintiffs appealed, arguing that the plain meaning of NDCC 47-06-07, as well as historical objectives of it and connected sections, call for application of that statute to both natural and artificial changes in the course of a navigable river and to an abandoned riverbed that still contains some water.

The Sun defendants do not dispute either the history or the policy of NDCC 47-06-07, but urge that it should be applied only to natural changes, not to man-made changes, and that the oxbow is not an abandoned riverbed. They argue that Pa-pineau does not need “indemnity” and therefore still owns the minerals under section 15. They further argue that laches and limitations support the summary judgment below and that the United States is a necessary party if the statute is applied.

The State of North Dakota argues that we should strictly construe NDCC 47-06-07 to protect the state’s “sovereign lands” from “intrusion.” Since Papineau was compensated by the United States for taking of his land in section 15, while being allowed to retain the underlying oil and gas, the State submits that he has not been deprived of anything by the river change, so indemnification under NDCC 47-06-07 is unnecessary. If the statute applies, the State further argues that the oxbow riverbed has not been “abandoned,” leaving factual issues to be addressed upon remand.

BACKGROUND

When North Dakota became a state, the beds of navigable waters, including that of the Missouri River, became state property by virtue of the equal footing doctrine. The purpose of state title was to protect the public right of navigation. See Montana v. United States, 450 U.S. 544, 551, 101 S.Ct. 1245, 1251, 67 L.Ed.2d 493 (1980) and Pollard’s Lessee v. Hagan, 44 U.S. (3 How.) 212, 225, 11 L.Ed. 565 et seq. (1845) (at 229: “to Alabama belong the navigable waters, and soils under them, ... subject to the rights surrendered by the constitution to the United States.”) Thus, the State of North Dakota holds title to the bed of the Missouri River. 1 See NDCC 47-01-14 2 and 47-01-15. 3 This title includes underlying oil and gas. State of North Dakota v. Andrus, 506 F.Supp. 619 (D.N.D.1981), aff'd, 671 F.2d 271 (8th Cir.1982), rev’d on other grounds, sub nom. Block v. North Dakota, 461 U.S. 273, 103 S.Ct. 1811, 75 L.Ed.2d 840 (1983), on remand, sub nom. State of North Dakota v. Andrus, 711 F.2d 118 (8th Cir.1983), appeal after remand, sub nom. State of North Dakota v. Block, 789 F.2d 1308 (8th Cir.1986). The Submerged Lands Act, § 3, 43 U.S.C. § 1311 (1976), reaffirmed the title of the states to lands beneath navigable waters at statehood, including “the natural resources within such lands and waters.”

The Missouri River and the land adjoining it (i.e., riparian land) are subject to the processes of accretion, erosion, avul *133 sion, and reliction. 4 The consequences of these processes are addressed in NDCC Ch. 47-06.

In the event of accretion and reliction, any accreted or bared land “belongs to the owner of the bank, ...” NDCC 47-06-05. 5 This statute “is essentially a restatement of the well-established common law rule governing riparian rights;” Hogue v. Bourgois, 71 N.W.2d 47, 53 (N.D.1955). It generally follows the common-law rule that a riparian owner gains land by accretion and reliction and loses it by erosion. See United States v. 11,993.32 Acres of Land, 116 F.Supp.

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Bluebook (online)
423 N.W.2d 130, 99 Oil & Gas Rep. 393, 1988 N.D. LEXIS 91, 1988 WL 35004, Counsel Stack Legal Research, https://law.counselstack.com/opinion/jp-furlong-enterprises-inc-v-sun-exploration-production-co-nd-1988.