Nygaard v. Getty Oil Co.

918 So. 2d 1237, 2005 WL 1712979
CourtMississippi Supreme Court
DecidedJune 30, 2005
Docket2003-CA-01605-SCT, 2004-CA-01614-SCT
StatusPublished
Cited by12 cases

This text of 918 So. 2d 1237 (Nygaard v. Getty Oil Co.) 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
Nygaard v. Getty Oil Co., 918 So. 2d 1237, 2005 WL 1712979 (Mich. 2005).

Opinion

918 So.2d 1237 (2005)

Thomas Max NYGAARD
v.
GETTY OIL COMPANY, Chevron Texaco Corporation f/k/a Texaco U.S. and J.R. Pounds, Inc.

Nos. 2003-CA-01605-SCT, 2004-CA-01614-SCT.

Supreme Court of Mississippi.

June 30, 2005.

*1238 Ben F. Galloway, Gulfport, attorney for appellant.

David L. Martindale, Laurel, Forest M. Dantin, Columbia, attorneys for appellee.

Before SMITH, C.J., CARLSON and DICKINSON, JJ.

DICKINSON, Justice, for the Court.

¶ 1. Nine years following notice of the claim, Thomas Max Nygaard, as trustee for the Daisy Keith Trust, filed this lawsuit to recover underpaid oil and gas royalties. The central question on appeal is whether *1239 accrued mineral royalties are an interest in personalty with a three-year statute of limitations or an interest in land with a ten-year statute of limitations. Finding that the trial court was correct in applying the three-year statute of limitations, we affirm.

BACKGROUND FACTS AND PROCEEDINGS

¶ 2. Nygaard alleges that, by an instrument dated September 27, 1972, the Daisy Keith Trust (of which he was trustee) obtained title to an overriding royalty interest in certain oil and gas wells in the Greens Creek Field in Marion County, Mississippi. Sometime in the early 1980s, Getty Oil Company began oil and gas production[1] from wells located in Marion County. Chevron Texaco Corporation[2] later became a successor in interest to Getty and, in March, 1992, Texaco conveyed its interests in the subject wells to J.R. Pounds., Inc.

¶ 3. On September 16, 1993, Nygaard received a letter from Texaco informing him that the production from two wells in Greens Creek Field had yielded royalties which were due to the Daisy Keith Trust and that the royalties had been held "in suspense"[3] by Getty. The letter also informed Nygaard that Texaco had sold its interest in the Greens Creek Field wells to Pounds. After providing documentation requested in the letter, Nygaard received a check for the amount Texaco claimed was due.

¶ 4. In July 1996, Nygaard contacted Texaco claiming additional royalties were due. The claim was supported by an "independent study." Texaco responded by sending Ronnie Martin and Daniel P. Loughry to meet with Nygaard and his agents in Dallas, Texas, on December 3, 1998. No agreement was reached.

¶ 5. On June 4, 2002, Nygaard, in his capacity as trustee, filed suit against Getty, Texaco, and Pounds for unpaid royalties on production from the Rogers 28-11 and Sipp 20-9 wells in Marion County. The suit alleged causes of action for fraud and deceit and conversion.

¶ 6. The defendants filed motions for summary judgment, asserting that the statute of limitations barred Nygaard's claims. On June 24, 2003, the trial court granted summary judgment to Getty and Texaco, and partial summary judgment to Pounds.[4]

¶ 7. The original appeal was dismissed because of matters which were then still pending in the trial court, and the parties did not request the trial court to certify the judgment as "final," in accordance with M.R.C.P. 54(b). Nygaard v. Getty Oil Co., 877 So.2d 559, 560 (Miss.Ct.App.2004).

¶ 8. On July 30, 2004, the trial court made final the summary judgment and partial summary judgment in accordance with Rule 54(b). Nygaard now appeals to this Court both the summary judgment and the partial summary judgment, alleging that the trial court applied an incorrect statute of limitations or, in the alternative, that the defendants' fraudulent concealment *1240 served to toll the running of the statute of limitations.

ANALYSIS

¶ 9. When a trial court grants summary judgment, our review is de novo. Leffler v. Sharp, 891 So.2d 152, 156 (Miss. 2004). Further,

[t]he evidence must be viewed in the light most favorable to the party against whom the motion has been made. A motion for summary judgment lies only when there is no genuine issue of material fact, and the moving party is entitled to a judgment as a matter of law. M.R.C.P. 56(c). This Court does not try issues on a Rule 56 motion; it only determines whether there are issues to be tried. The presence of fact issues in the record does not per se entitle a party to avoid summary judgment. "The court must be convinced that the factual issue is a material one, one that matters in an outcome determinative sense . . . . the existence of a hundred contested issues of fact will not thwart summary judgment where there is no genuine dispute regarding the material issues of fact."

891 So.2d at 156 (citation omitted) We also review issues of law (such as the applicable statute of limitations) de novo. Andrus v. Ellis, 887 So.2d 175, 179 (Miss.2004).

Statute of limitations

¶ 10. For certain causes of action, the Legislature has set a specific time limitation for bringing suit. For instance, a lawsuit claiming libel or slander must be brought within one year after the cause of action accrued. Miss.Code Ann. § 15-1-35 (Rev.2003). Furthermore, "[t]he completion of the period of limitation prescribed to bar any action, shall defeat and extinguish the right as well as the remedy.. . ." Miss.Code Ann. § 15-1-3 (Rev. 2003). Causes of action for which no specific limitation period is prescribed are governed by Mississippi's general three-year statute of limitations, which reads: "All actions for which no other period of limitation is prescribed shall be commenced within three (3) years next after the cause of such action accrued, and not after." Miss.Code Ann. § 15-1-49(1) (Rev.2003).

¶ 11. Mississippi has no specific statute of limitations for claims of unpaid royalties. Thus, the defendants argue that the general three-year statute of limitations applies. However, Nygaard says his claim for unpaid royalties equates to a claim for recovery of an interest in land. If so, then Nygaard's claim would be governed by Miss.Code Ann. §§ 15-1-7 and/or 15-1-9 (Rev.2003), both of which prescribe a ten-year limitation period.

¶ 12. In Merrill Engineering Co. v. Capital National Bank of Jackson, 192 Miss. 378, 5 So.2d 666 (1942), this Court held that "it is well settled by the great weight of authority from other jurisdictions that until brought to the surface and reduced to possession, oil or gas constitute an interest in real estate and not personal property." Id. at 670 (citations omitted) (emphasis added).

¶ 13. In Palmer v. Crews, 203 Miss. 806, 35 So.2d 430 (1948), this Court stated that "the distinction is to be kept clearly in mind between the thing itself, that is to say, minerals in place, and the proceeds thereof." Id. at 435.

¶ 14. In Estate of Haynes v. Steele, 699 So.2d 918 (Miss.1997), this Court held that, "although the right to receive royalty payments in the future from underlying mineral deposits is considered an interest in land, royalty proceeds, once paid, are personal property and no longer considered an interest in land." Id. at 925 (emphasis added) (citing Dougherty v. Greene, 218 Miss. 250, 67 So.2d 297 (1953)).

*1241 ¶ 15.

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Bluebook (online)
918 So. 2d 1237, 2005 WL 1712979, Counsel Stack Legal Research, https://law.counselstack.com/opinion/nygaard-v-getty-oil-co-miss-2005.