Patrick Petroleum Corp. v. Poche

384 So. 2d 834, 67 Oil & Gas Rep. 20, 1980 La. App. LEXIS 4011
CourtLouisiana Court of Appeal
DecidedMay 13, 1980
DocketNo. 11103
StatusPublished
Cited by1 cases

This text of 384 So. 2d 834 (Patrick Petroleum Corp. v. Poche) 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
Patrick Petroleum Corp. v. Poche, 384 So. 2d 834, 67 Oil & Gas Rep. 20, 1980 La. App. LEXIS 4011 (La. Ct. App. 1980).

Opinion

SCHOTT, Judge.

Before GULOTTA, SCHOTT and CHE-HARDY, JJ.

This is a concursus proceeding provoked by Patrick Petroleum Corporation in order to resolve conflicting claims between the Nobile-Faucheux group and the Poche group. From a judgment in favor of the Poche group the others have appealed.

The principal issue in the case is whether Thomas Poche conveyed to A. L. Faucheux and Felix F. Nobile on March 30, 1936, a mineral interest in property in St. James Parish or a mere royalty interest. Appellants concede that if a mere royalty interest was conveyed they have lost that interest by prescription since there has been no production on or involving the property as a result of pooling agreements since 1955. On the other hand, appellants contend that their ancestors were conveyed a mineral servitude interest and that prescription was interrupted in 1965 and 1974 by good faith efforts to drill wells on the property.

When the Poche to Faucheux-Nobile sale was made the property was subject to a mineral lease granted by Federal Land Bank of New Orleans to Shell Petroleum Corporation on January 2, 1936, for a five-year term, and the sale was of the following:

“ONE-SIXTEENTH (being one-half of one-eighth royalty) interest in and to all of the oil, gas, sulphur and other minerals on, in and under and that may be produced from the following described lands, situated in the Parish of St. James, State of Louisiana, to-wit:”

Had the instrument been concluded at this point, i. e., with the property description following, there would be no issue for resolution, but following the property description the instrument continued:

“It is understood and agreed, between the parties hereto, that this sale is made subject to any valid and duly recorded oil, gas, sulphur and mineral lease now in force and effect, and embracing the above described lands, and particularly an outstanding oil and gas lease entered into between The Federal Land Bank of New Orleans and The Shell Petroleum Corporation, under date of January 2,1936, but covers and includes a full one-half of all the royalty on oil, gas, sulphur and other minerals due and to become due and payable under the terms of said lease; and furthermore, in the event the above mentioned lease for any reason becomes terminated, cancelled or forfeited, then and in that event a full one-sixteenth interest In and to all the oil, gas, sulphur and other minerals on, in and under and that may be produced from the above mentioned lands shall be owned free of further cost by the Vendees herein.” (Emphasis supplied)

Appellants’ interpretation of this instrument is that the first quoted part of the instrument constituted a sale of a royalty interest but the second quoted portion, and particularly that portion which we have emphasized, constituted a conveyance of a mineral servitude interest.

Were we to conclude that this was a conveyance of a mineral servitude interest we would then be confronted with the issue of whether the drilling of wells in 1965 and 1974 were good faith drilling attempts so as to interrupt prescription until the present production began. But our resolution of the basic issue makes it unnecessary to address this additional issue.

Standing alone, the March 30, 1936, instrument seems to convey a royalty interest. The paragraph on which appellants depend does not seem to convey an additional interest but only to explain what happens to the royalty interest in the event of termination of the Shell lease. After the paragraph repeats that the conveyance “covers and includes a full one-half of all the royalty” which might accrue from the Shell lease during its existence, it goes on to say that the same one-sixteenth royalty interest will continue to be owned by Fau-cheux and Nobile without regard to the expiration of the Shell lease.

The jurisprudence provides an explanation as to why the parties added the language on which appellants base their argu[836]*836ment. In Humble Oil & Refining Co. v. Guillory, 212 La. 646, 33 So.2d 182 (1947) the court said:

“The sale of royalties under an existing lease and future leases, is nothing more than the transfer of a proportionate share of the production, if any, that the landowner may be entitled to under the terms of the lease. It is a right predicated upon another right, the lease. Whenever the lease lapses by its terms the right to royalties thereunder necessarily passes out of the picture. Calcasieu Oil Co., Inc. v. Yount-Lee Oil Co. et al., 174 La. 547, 141 So. 55; Parten v. Webb et al., 197 La. 197, 198, 1 So.2d 76.”

In the absence of the additional language designed to perpetuate the royalty interest beyond the termination of the Shell lease, that royalty interest would have lapsed in 1941.

If there is any doubt as to this interpretation it seems to be eliminated considering three subsequent instruments which were executed by these parties.

First, on February 16, 1938, the parties executed an agreement acknowledging the previous March 30, 1936, agreement as follows:

“WHEREAS, the undersigned Thomas Poche did on the 30th day of March A.D. 1936, execute a deed conveying to the undersigned Alonzo L. Faucheux and Felix F. Nobile, and heirs and assigns, in the equal proportions,
One-Sixteenth (being one-half of one-eighth royalty) interest in and to all of the oil, gas, sulphur and other minerals on, in and under and that may be produced from the lands fully described in said deed duly recorded in Conveyance Book “J” folio “12” of the records of the Parish of St. James.
AND WHEREAS, the consideration paid for said royalty interest in said mineral was the cash sum of Two Thousand Dollars duly paid unto the said vendor by the said vendees;
AND WHEREAS, the intention was to convey said royalty interest to said vendees, and their heirs and assigns, forever, and in full ownership, which is hereby reiterated by the said vendor.
NOW, THEREFORE, the said parties now further agree and covenant as follows:
1. For and in consideration of the agreement hereinafter set forth, the said vendor agrees and binds himself, heirs and assigns, to grant unto vendees a deed conveying the full ownership of said one-sixteenth royalty interest in said property as soon as any state law is enacted with respect thereto and moreover agrees and binds himself, heirs and assigns to continue into full force and effect the said sale of royalty by renewal thereof, and in this connection the said grant is hereby renewed as of this date.”

On January 16, 1945, the parties again executed an acknowledgment because of production which was then occurring on property with which the subject property was joined in a pooled unit. This document contains the following:

“WHEREAS, the undersigned, Thomas Poche, as Vendor, did on the 30th day of March, 1936, execute a deed conveying to the undersigned, Alonzo L. Faucheux and Felix F. Nobile, as Vendees, heirs and assigns, in equal proportions,

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Related

Patrick Petroleum Corp. of Michigan v. Poche
392 So. 2d 664 (Supreme Court of Louisiana, 1980)

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Bluebook (online)
384 So. 2d 834, 67 Oil & Gas Rep. 20, 1980 La. App. LEXIS 4011, Counsel Stack Legal Research, https://law.counselstack.com/opinion/patrick-petroleum-corp-v-poche-lactapp-1980.