Nitro Energy, L.L.C. v. Nelson Energy, Inc.

34 So. 3d 524, 177 Oil & Gas Rep. 648, 2010 La. App. LEXIS 962, 2010 WL 1462485
CourtLouisiana Court of Appeal
DecidedApril 14, 2010
Docket45,201-CA
StatusPublished
Cited by7 cases

This text of 34 So. 3d 524 (Nitro Energy, L.L.C. v. Nelson Energy, Inc.) is published on Counsel Stack Legal Research, covering Louisiana Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Nitro Energy, L.L.C. v. Nelson Energy, Inc., 34 So. 3d 524, 177 Oil & Gas Rep. 648, 2010 La. App. LEXIS 962, 2010 WL 1462485 (La. Ct. App. 2010).

Opinion

LOLLEY, J.

^Nelson Energy, Inc. and Richard B. Nelson (“appellants”) appeal a judgment from the Second Judicial District Court, Claiborne Parish, Louisiana, which granted the motion for summary judgment in favor of Nitro Energy, L.L.C. and Donald Faust. For the following reasons, we affirm the trial court’s judgment.

Facts

The property at issue in this case is a portion of several tracts of land totaling 227 acres in Section 14, Township 19 North, Range 5 West (the “Swift Tract”). Although the parties are disputing that portion of the property that is located only in Claiborne Parish, some of the Swift Tract is also located in Lincoln Parish. The entire tract was identified initially in a deed dated August 26, 2002, from Emmett R. Woodard, Ann Woodard Windsor and Dell Woodard Nichols to Rickey K. Swift, Jeweline Malone Swift, Darren C. Swift and his wife, Cherrie Stallworth Smith (the “Woodard deed”). The Woodard deed was properly recorded in the conveyance records of both Claiborne and Lincoln Parishes, as it pertained to property located in both parishes.

The appellant, Richard Nelson, obtained a mineral lease purporting to cover the entire Swift Tract on September 30, 2004, from each of the owners of the tract (the “Nelson Lease”). The Nelson Lease was recorded in Lincoln Parish on February 4, 2005. Although it purported to apply to all of the property in Lincoln and Claiborne parishes, Nelson did not record the Nelson Lease in Claiborne Parish, which he concedes was a mistake on his part. The Nelson Lease described the property affected by referring to the | ¡Woodard deed and included the Lincoln Parish recording information. The Claiborne Parish recording information was not referred to, and Nelson did not file the lease in the Claiborne Parish records until January 3, 2006.

On December 21, 2005, Donald Faust obtained a mineral lease covering the portions of the Swift Tract only in Claiborne Parish; however, only two of the landowners, Rickey Swift and Jeweline Swift, signed (the “Faust Lease”). Together, Rickey and Jeweline owned two-thirds of the Swift Tract. That lease was recorded in the Claiborne Parish public records on the same day. The Faust Lease contained the following property:

Section 14, Township 19 North, Range 5 West
A tract of land containing 227 acres, more or less, and being the same land described in that deed dated August 26, 2002 from Emmett R. Woodard et al [sic] to Rickey K. Swift, and recorded in Book 1136, Page 363 of the conveyance records of the Lincoln Parish, LA. It is the intention of the Grantors to convey all their interest in that land lying in Claiborne Parish, La. whether more particularly described or not.

The Faust Lease did not state that the property included lands in both Sections 11 and 14, Township 19 North, Range 5 West, because the Faust Lease only pertained to that part of the property in Claiborne Parish. Further, it did not refer to the Claiborne Parish conveyance book and page for the Woodard deed. Notably, on the day the Faust Lease was recorded, December 21, 2005, the Nelson Lease had not been recorded. As stated, the Nelson Lease was not recorded in the Claiborne Parish public records until January 3, 2006.

In 2008, Nitro Energy and Faust filed suit seeking (among other claims) a declaration from the trial court that the Faust *526 Lease was the pranking and valid lease on the portion of the Swift Tract located in Claiborne Parish, Louisiana, as to the two-thirds ownership interest described in the Faust Lease. The parties filed cross motions for summary judgment, agreeing ultimately that there was no dispute regarding the material facts of the case. They also agreed that the sole issue in dispute was the sufficiency of the description contained in the Faust Lease. After a hearing on the matter, the trial court ruled in favor of Nitro Energy and Faust, and this appeal by Nelson Energy and Nelson ensued.

Discussion

There is one issue on appeal: whether the property description stated in the Faust Lease is so inaccurate or faulty as to be actually misleading. Specifically, appellants urge that the Faust Lease contains several errors in the property description that are misleading and conflicting which would prevent a third party from identifying with certainty the property covered by the lease, so as to render the Faust Lease ineffective to third parties. Thus, we are called to determine whether the property description contained in the Faust Lease was sufficient to put third parties on notice. The parties agree that if it is, then the Faust Lease is the ranking and valid lease pertaining to that part of the Swift Tract located in Claiborne Parish.

As stated, the Faust Lease describes the property it intends to affect as follows:

Section 14, Township 19 North, Range 5 West
A tract of land containing 227 acres, more or less, and being the same land described in that deed dated August 26, 2002 from Emmett R. Woodard et al [sic] to Rickey K. Swift, and recorded in Book 1136, Page 363 of the conveyance records \ ¿of the Lincoln Parish, LA. It is the intention of the Grantors to convey all their interest in that land lying in Claiborne Parish, La. whether more particularly described or not. (Emphasis added).

Primarily, it is the emphasized text that the appellants contend makes the property description misleading. We disagree.

This issue was decided on a motion for summary judgment, with the appellants contesting the trial court’s grant of the motion for summary judgment filed by Faust and Nitro Energy. In considering the trial court’s rulings on a summary judgment motion, we apply a de novo standard of review. Summary judgment should be granted where “the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to material fact, and that mover is entitled to judgment as a matter of law.” La.Code Civ. P. art. 966(B). Here, as there is no genuine issue of material fact, we must determine whether Nitro Energy and Faust were entitled to summary judgment as a matter of law.

Louisiana C.C. art. 3338 now states the public records doctrine under Louisiana law. It states, in pertinent part, as follows:

The rights and obligations established or created by the following written instruments are without effect as to a third person unless the instrument is registered by recording it in the appropriate mortgage or conveyance records pursuant to the provisions of this Title:
(1) An instrument that transfers an immovable or establishes a real right in or over an immovable.

A third person is a person who is not a party to or personally bound by an instrument. La. C.C. art. 3343. Thus, Faust is a third party as to the Nelson | .¿Lease and Nelson is a third party as to the Faust *527 Lease. Further, as pointed out by Faust, mineral leases are classified as incorporeal immovable property, and as such, they are subject to the public records doctrine as provided in the Civil Code. La. R.S. 31:18.

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Bluebook (online)
34 So. 3d 524, 177 Oil & Gas Rep. 648, 2010 La. App. LEXIS 962, 2010 WL 1462485, Counsel Stack Legal Research, https://law.counselstack.com/opinion/nitro-energy-llc-v-nelson-energy-inc-lactapp-2010.