Norman v. Apache Corporation

• Court: Court of Appeals for the Fifth Circuit
• Decided: July 6, 1995
• Docket: 95-40146
• Status: Unpublished

Opinion

UNITED STATES COURT OF APPEALS for the Fifth Circuit

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No. 95-40146 Summary Calendar _____________________________________

HORACE NORMAN, ET AL.,

Plaintiffs-Appellants,

VERSUS

APACHE CORPORATION,

Defendant-Appellee.

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Appeal from the United States District Court for the Southern District of Texas (CA-G-91-378) ______________________________________________________ (July 20, 1995)

Before GARWOOD, JOLLY and DUHÉ, Circuit Judges.

PER CURIAM:1

The owners of working interests in mineral leases brought an

action against Apache Corporation, the unit operator, alleging

breach of contract, fraud, and breach of fiduciary duty. The

Defendant operator had halted production of the unit well in mid-

July 1990, causing the leases maintained by unit production to

terminate. In earlier proceedings, this Court affirmed dismissal

of the fraud and fiduciary duty claims and reversed the district

court's grant of summary judgment on the breach of contract claim.

1 Local Rule 47.5 provides: "The publication of opinions that have no precedential value and merely decide particular cases on the basis of well-settled principles of law imposes needless expense on the public and burdens on the legal profession." Pursuant to that Rule, the Court has determined that this opinion should not be published. Norman v. Apache Corp., 19 F.3d 1017 (5th Cir. 1990). This Court

found genuine issues of material fact exist regarding whether

Apache misrepresented to the owners that it was continuing to

produce the well from July through November 1990, and whether

Apache breached its duty to act as a prudent operator by failing to

take reasonable steps to prevent the loss of the leases. Id. at

1031. On remand the district court again granted summary judgment

to Defendants. We reverse.

The district court found the remanded issues moot, holding as

a matter of law that Plaintiffs had been made whole and could not

maintain their cause of action for damages:

Even if every allegation against the Defendant is true, such acts were cured when the Defendant reacquired and assigned the leases to the Plaintiffs. At that time, the status quo was duly restored by re-establishing the Plaintiffs' opportunity to drill.

Once Defendants reacquired and assigned the leases to the Plaintiffs, the Plaintiffs were made whole and cannot, as a matter of law, maintain a cause of action against the Defendant for consequential damages relating to lost leases since the leases were no longer "lost."

1 R. 707. The record precludes the summary judgment finding that

Plaintiffs "were made whole" upon Defendant's reacquisition and

assignment of leases to Plaintiffs. The record reflects that the

new leases differ in material respects from the lost leases. See,

e.g., Sbarbaro dep. at 30 (noting that some interests included in

the lost leases remained unleased under the new leases); aff. of

Jack Finkelstein at 4 (noting higher royalty burden and lack of

warranty of title on the new leases as contrasted with the lost

leases). Such evidence precludes the summary judgment findings

2 that Plaintiffs were made whole and that "the status quo was duly

restored." Finding the summary judgment evidence bearing on these

material facts disputed, we reverse the summary judgment and

remand.

We decline Appellants' invitation to address the issue of the

proper measure of damages, a question to be addressed, if

appropriate, in the first instance by the district court.

REVERSED and REMANDED.