Prentice v. Amax Petroleum Corp.

187 So. 2d 752, 1966 La. App. LEXIS 5248
CourtLouisiana Court of Appeal
DecidedFebruary 28, 1966
DocketNo. 6589
StatusPublished
Cited by2 cases

This text of 187 So. 2d 752 (Prentice v. Amax Petroleum Corp.) 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
Prentice v. Amax Petroleum Corp., 187 So. 2d 752, 1966 La. App. LEXIS 5248 (La. Ct. App. 1966).

Opinions

BAILES, Judge.

Plaintiffs, Robert B. Prentice and M. H. Marr, became the record owner of a certain oil, gas and mineral lease granted by Mrs. Octavia Robertson Landry, et al. to Leo J. Caballero, dated January 29, 1960, affecting the western most 100 acres of Voiron Plantation situated in Assumption Parish. At the time Caballero was granted this lease it was what is known as a [754]*754top lease subordinate to the lease cancelled in suit entitled Landry et al. v. Flaitz et al., reported in 245 La. 223, 157 So.2d 892. Plaintiffs were assigned the lease which is the subject of this litigation by Caballero after the termination of Landry v. Flaitz, supra.

This is an action wherein plaintiffs are seeking a declaratory judgment recognizing them to be the owners of the lease the Landrys granted to Caballero as against the claim of defendants, Amax Petroleum Corporation and R. B. Mitchell.

Additionally, plaintiffs seek a declaratory judgment against Callery Properties, Inc., and Pan-American Petroleum Corporation decreeing these defendants without right or authority to withhold from plaintiffs the proceeds of production attributable to the oil, gas and mineral lease described above, and further, decreeing Amax and Mitchell without authority to receive said proceeds, and for an accounting of the receipt of proceeds of production as well as drilling and operating costs .attributable to said lease, and for other associated relief not necessary to detail herein.

Subsequent to the filing of defendants’ answers, plaintiffs moved for summary judgment alleging “that, as will appear from the pleadings and the attached affidavits, there is no genuine issue as to any material fact in this case, and that plaintiffs are, therefore, entitled to a summary judgment * * * as prayed for in ■their petition.

By their petition, plaintiffs claim ownership of the subject lease by assignment from Caballero; that through the cancellation of the lease in Landry v. Flaitz, supra, plaintiffs became entitled to the production of the well drilled under an operating agreement to which Amax and Mitchell were parties; the cancellation of the lease by judgment of the Supreme ■Court of this state in Landry v. Flaitz, ■supra, was a title failure as defined by the •operating agreement, which title failure was effective as of March 30, 1960; demand had been made on Callery and Pan-American for the portion of the production of said well attributable to the subject lease, but without avail.

After answering the demands of the plaintiffs as articulated in their petition, defendants Amax and Mitchell further answered by alleging the existence of three operating agreements dated respectively April 15, 1957, March 15, 1960 and October 6, 1960, by virtue of which a relationship of joint adventure between plaintiffs, defendants and others had been created; the discovery well of the unit of acreage involving subject lease was drilled by the joint adventure so created; the “plaintiffs, and plaintiff Prentice’s employee, Leo J. Caballero, entered into a plan or combination designed to unjustly enrich plaintiffs by acquiring a top lease on defendants’ 1957 lease and procuring the termination of defendants’ lease so as to make the top lease become effective, said plan being in violation of the fiduciary obligations owed by plaintiffs to defendants; all of the details of said plan are peculiarly within plaintiffs’ knowledge, except to the extent that they are disclosed by the documents hereinafter referred to.”

Plaintiffs attached to their petition a copy of the lease the Landrys granted in favor of Caballero, the act of assignment from Caballero to the plaintiffs, a copy of the operating agreement of March 15, 1960, of October 6, 1960, and of April 15, 1957. In the record, we find a letter from Caballero to the Landrys acknowledging the existence of the top lease and setting forth an additional consideration in the event the top lease becomes effective against the property. Additionally, there are three affidavits filed by the defendants. These are the affidavit of Gordon L. Lewis, attesting to the lack of knowledge on the part of Callery of the ownership claim of plaintiffs to subject lease; affidavit of defendant, R. B. Mitchell, as to the plan of plaintiffs to “freeze out” defendants Amax and Mitchell by not agreeing to a [755]*755voluntary unit for the production of oil from the well drilled under their operating agreement, and the acquisition of the Landry lease by Caballero; and the affidavit of H. H. Hillyer, Jr., attesting to the plan of plaintiffs to liquidate defendants Amax and Mitchell from the Landry lease through the acquisition thereof by Caballero.

In the judgment of the trial court, the trial judge stated:

“On motion for summary judgment the following facts are revealed by the records introduced:
“1. On March 29, 1957, some of defendants herein secured an oil and gas lease on the land herein concerned. This lease had a primary term expiring on March 29, 1960.
2. On April 15, 1957, plaintiffs and defendants herein entered into an oil and gas lease operating agreement. The land herein concerned, although under lease to defendants, was not included in this agreement.
3. On January 25, 1960, an oil well was completed on land covered by the operating agreement.
4. On January 29, 1960, one Leo J. Caballero secured an oil and gas lease on the land herein concerned. Said Caballero secured the lease as agent for plaintiffs herein and for their benefit.
5. On March 28, 1960, the Commissioner of Conservation issued a forced pooling order under which a portion of the land herein concerned was unitized with lands covered by the operating agreement as Unit 9.
6. On June 8, 1960, Caballero, acting as agent for plaintiffs, contracted with the owners of the land herein concerned to institute legal proceedings, all at the agents expense, to have the lease granted defendants cancelled.
7. On July 27, 1960, such an action was filed.
8. On October 6, 1960, plaintiffs and defendants entered into an operating agreement for Unit 9 and plaintiffs stated in said agreement that they had no leasehold interest on the land herein concerned and plaintiffs recognized that defendants had a leasehold interest on the lands herein concerned.
9. On November 12, 1963, the Louisiana Supreme Court ordered cancellation of the oil and gas lease granted to defendants on the land herein concerned. .
10. On December 13, 1963, Caballero filed for record the oil and gas. lease secured on the land herein, concerned on January 29, 1960.
11. On February 18, 1964, Caballero-assigned the oil and gas lease to-plaintiffs herein, said assigned’ (sic) to be effective as of January 29, 1960.
“Simply put, plaintiffs, knowing the-land herein concerned would be forced pool with lands covered by the 1957' operating agreement, secured a top-lease, which they kept secret. Contracted for and financed legal action-to cancel defendants lease, all of which they kept secret; entered into an operating agreement relative to the land herein concerned without divulging their interest, and, only after defendants’ lease was cancelled, did they file the top lease and assume title to said lease.”

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Prentice v. Amax Petroleum Corporation
220 So. 2d 783 (Louisiana Court of Appeal, 1969)
Prentice v. Amax Petroleum Corp.
188 So. 2d 607 (Supreme Court of Louisiana, 1966)

Cite This Page — Counsel Stack

Bluebook (online)
187 So. 2d 752, 1966 La. App. LEXIS 5248, Counsel Stack Legal Research, https://law.counselstack.com/opinion/prentice-v-amax-petroleum-corp-lactapp-1966.