Phillips Petroleum Co. v. Davis Adm'rs

1942 OK 243, 147 P.2d 135, 194 Okla. 84, 1942 Okla. LEXIS 6
CourtSupreme Court of Oklahoma
DecidedJune 16, 1942
DocketNo. 29630.
StatusPublished
Cited by13 cases

This text of 1942 OK 243 (Phillips Petroleum Co. v. Davis Adm'rs) is published on Counsel Stack Legal Research, covering Supreme Court of Oklahoma primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Phillips Petroleum Co. v. Davis Adm'rs, 1942 OK 243, 147 P.2d 135, 194 Okla. 84, 1942 Okla. LEXIS 6 (Okla. 1942).

Opinion

RILEY, J.

This is an appeal from a judgment against plaintiff in error and in favor of defendant in error J. C. Davis in a proceeding in accounting for oil and gas produced by Phillips Petroleum Company from a well drilled in block 3, Aungst addition to Oklahoma City.

The well was drilled under a permit granted by the board of adjustment under the provisions of what is known as the zoning ordinance. For convenience plaintiff in error will hereinafter be referred to as Phillips, and defendant in error J. C. Davis will be referred to as Davis. Phillips procured the permit to drill the well and in its application stated that it was the owner of valid subsisting community oil and gas leases covering all the lots in said block except lots 1 to 4, inclusive, and lots 22 to 25, inclusive. The lots claimed by Davis are lots 1 and 2 in said block. Along with other information required by the ordinance was a certificate from a bonded abstracter certifying the-name of the last record owner and the character of instrument or conveyance upon which the ownership rests. With reference to lots 1 and 2, the certificate showed as owner: “E. M. Bissell (Deed) Louis J. Rusche (Deed) title based on tax deed issued to him 9-5-21.” As to lots 3 and 4 it showed as owner, “Louis J. Rusche (Deed).” At another place where the names and last-known addresses of lot owners in the block were given, it was stated as to lots “1 and 2 owner E. M. Bissell, whereabouts unknown,” and a notation “serve notice by publication.” Immediately thereunder it showed as to the same lots “1 and 2 Louis J. Rusche and Minnie Rusche, Harrah, Oklahoma.” As to lots 3 and 4 the statement showed that Louis J. Rusche, Harrah, Okla., was the owner. Though the application stated that Phillips had no lease covering lots 1 to 4, inclusive, it later developed that it did in fact have assigned to it an oil and gas lease covering said lots 1 to 4, inclusive, executed by Louis J. Rusche and Minnie Rusche.

The ordinance provides that the board of adjustment:

“. . . shall have authority and shall make any requirements, regulations or orders which may be necessary, proper or equitable for all persons interested therein, and shall protect and safeguard the rights of all parties affected by such order.”

And:

“. . . The board of adjustment, after giving notice and conducting hearing as hereinafter provided, shall have authority to determine the equities and grant a proper permit for drilling a well upon such block or tract.”

The order granting the permit contained the following provisions:

“It is the judgment of the board, and the board so finds, that each owner of lots or parcels of land in said block 3, should be entitled to share in the one-eighth (%) of the oil, gas and/or cas-inghead gas that may be produced from the well to be drilled on said block 3 in the proportion that the area of such lots and parcels of land, exclusive of streets and alleys, bears to the entire area of said block 3, exclusive of streets and alleys; ...”
“It is further ordered, adjudged and decreed that any owner of any valid and subsisting oil and gas lease covering any lots or parcels of land within said Block 3 not leased to appellant herein, and/or any owner of any unleased lots or par *87 cels of land within said Block 3, shall have the right to participate in and receive his, or their proportionate part of the seven-eighths (%) working interest oil, gas and/or casinghead gas produced from said Block 3 in the proportion that the area of such lots or parcels of land, exclusive of streets and alleys, bears to the entire area of said Block 3, exclusive of streets and alleys, upon compliance of such owner with the following conditions:
“Within ten days (10) after the issuance of permit as provided herein, the appellant shall serve written notice, either by registered mail to the last known addresses, or by personal service upon all such lease owners, or owners of unleased lots or tracts, that appellant intends to drill, or is drilling, a well upon said Block Three (3), and each such owner shall have ten (10) days from the date of service of such notice to furnish a bond signed by some surety company, authorized to do business in the State of Oklahoma, running in the name of the appellant herein, executed by such owner as principal and conditioned that such owner will pay as rendered, all proper bills for his proportionate part of all costs and expenditures in the preparing for drilling, drilling, equipping, operating and maintaining said well and appurtenances thereto, and that such owner shall be liable for his proportionate part of all damages as the result of drilling, operation or maintenance of said well and said bond shall at all times be maintained and kept in full force and effect during the drilling of said well and shall be in the sum of One Dollar ($1.00) per square foot of the area of the lease, or unleased lots or tracts owned by such owner. If such owner of such lease, or unleased lots or tracts shall not furnish said bond to appellant herein within ten (10) days after service of said notice, then and in said event said owner or owners shall have no further right hereunder to receive or participate in the seven-eighths (%) production from said well. No owner whose interest does not appear of record, or of whose interest appellant shall have no notice at the time of the giving of notice by appellant as here-inabove provided, shall be entitled to share in any part of the seven-eighths (%) production from said well.”

The matter in controversy here is the right of Davis, as present owner of lots 1 and 2, to participate in the proceeds of the oil and gas produced from the well drilled under said permit. The facts giving rise to the controversy are somewhat complicated, but in brief are:

In 1910, E. M. Bissell became the record owner of said lots 1 and 2, by deed. He failed to pay the taxes thereon after 1917, and a tax deed for said lots was issued by the county treasurer to Louis J. Rusche and Minnie Rusche in 1921.

On February 12, 1930, the Rusches executed an oil and gas lease covering said lots 1 and 2, along with lots 3 and 4, to Mid-Texas Petroleum Company. That company, on March 10, 1930, assigned said lease to Phillips. April 22, 1931, Phillips made its application for permit to drill a well on said block. The permit was granted with the provisions above noted.

A well was commenced on lots 27 and 28 in said block, and was drilled to the producing formation about September, 1931. After two months’ test it was demonstrated that the well would be highly profitable.

In January thereafter a suit was commenced in the district court of Oklahoma county in the name of E. M. Bis-sell wherein he asserted that he was the owner of lots 1 and 2, and wherein he sought cancellation of the tax deed to the Rusches. Phillips et al. were made parties defendant. Bissell alleged that he was in possession, but further alleged that some of the defendants claimed some sort of possession. The prayer was that title be quieted in Bis-sell and if it be found that any of the defendants were in possession, they be ejected.

Issues were joined in that action and trial was had before Honorable T. G. Chambers, then district judge, on or about March 8, 1933.

On March 9, 1933, there was noted on the docket the following entry:

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Cite This Page — Counsel Stack

Bluebook (online)
1942 OK 243, 147 P.2d 135, 194 Okla. 84, 1942 Okla. LEXIS 6, Counsel Stack Legal Research, https://law.counselstack.com/opinion/phillips-petroleum-co-v-davis-admrs-okla-1942.