Southern Natural Gas Co. v. Poland

406 So. 2d 657
CourtLouisiana Court of Appeal
DecidedNovember 2, 1981
Docket14670-14679
StatusPublished
Cited by19 cases

This text of 406 So. 2d 657 (Southern Natural Gas Co. v. Poland) 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
Southern Natural Gas Co. v. Poland, 406 So. 2d 657 (La. Ct. App. 1981).

Opinion

406 So.2d 657 (1981)

SOUTHERN NATURAL GAS COMPANY, Plaintiff-Appellee,
v.
Billie J. Cummings POLAND, et al.
Charles Wesley JORDAN, et al.
William Travis LOWREY, et al.
William Travis LOWREY, et al.
Steven W. SUTTON, et al.
Elmer D. WALKER, et al.
Glenn C. LOWREY, et al.
Grace PRUITT.
Larry C. SUTTON, et al.
Bill C. SUTTON, et al., Defendants-Appellants.

Nos. 14670-14679.

Court of Appeal of Louisiana, Second Circuit.

November 2, 1981.
Rehearing Denied December 10, 1981.

*659 Bobby L. Culpepper, Jonesboro, Hal R. Henderson, Arcadia, for defendants-appellants.

Liskow & Lewis, by Robert T. Jorden, John M. Wilson & Frederick W. Bradley, New Orleans, for plaintiff-appellee.

Before PRICE, HALL and MARVIN, JJ.

En Banc. Rehearing Denied December 10, 1981.

MARVIN, Judge.

In these nine appeals in ten consolidated actions under LRS 19:2(5), the judgments expropriated from the several defendants their respective rights in and above an underground reservoir for the storage of natural gas, fixed compensation to be paid for those rights, and in six cases, cast plaintiff Southern Natural with costs and attorney fees incurred by defendants.[1]

In 12 assignments of error in these appeals, defendants question the constitutionality of the expropriation statutes and whether the statutory requirements for expropriation were met by Southern Natural. Alternatively, defendants seek to increase the amount awarded as compensation. Southern Natural's answer in six appeals seeks to amend the judgments where Southern Natural was cast for costs and attorney fees. We amend and affirm.

PREFACE

THE CONSTITUTIONAL AND STATUTORY REQUIREMENTS

LSA-Constn. Art. 1, § 4, expressly provides that the right of a person to own and enjoy private property is subject to the reasonable exercise of police power and that for a public and necessary purpose, with just compensation paid to the owner, private property may be expropriated by a private entity authorized by law to expropriate.

LRS 19:2(5) provides that if a price cannot be agreed on with the owner of property [after good faith negotiation], the needed property may be expropriated by any domestic or foreign corporation created for the piping and marketing of natural gas for the purpose of supplying the public with natural gas. In a later enacted statute, LRS 30:22, the legislature has declared that the underground storage and reservation of large quantities of natural gas, for orderly withdrawal in periods of peak demand by the consumer, is in the public interest and public purpose.

LRS 30:22 requires any person, prior to and as a condition precedent to exercising the power to expropriate any underground reservoir for the storage of natural gas, to obtain the express approval of the Commissioner of Conservation. Under this statute, the Commissioner is required to give notice to the persons affected by the expropriation, hold hearings and to determine

—that the reservoir is suitable and feasible for the purpose;

—that no reservoir which is capable of producing oil in paying quantities shall be used for storage purposes unless such reservoir has a greater value for storage than the production of the remaining volumes of original reservoir natural gas and condensate, and at least 3/4ths of the owners in interest, exclusive of any "lessor" defined in LRS 41:1261, have consented to such use in writing,

—that the storage will not contaminate other formations containing fresh water, oil, gas, or other commercial mineral deposits, and

—that the storage will not endanger lives or property. *660 The Commissioner is also required to determine the amount of the original commercially recoverable gas and condensate remaining in the reservoir, if any. See LRS 30:22(B) and (C).

The Commissioner's order may be appealed or challenged in judicial proceedings at the Commissioner's domicile in East Baton Rouge Parish. When final, the Commissioner's order shall be taken as prima facie valid and may not be collaterally attacked. LRS 30:12. Interstate Oil Pipe Line Co. v. Guilbeau, 217 La. 160, 46 So.2d 113 (1950); Brown v. Alice-Sydney Oil Co., 343 So.2d 745 (La.App. 2d Cir. 1977).

Natural gas marketing companies do not enjoy quick-taking expropriation power such as is enjoyed by the Department of Highways, but must first establish in an expropriation action, the public and necessary purpose to be served by the expropriation (LSA-Constn. Art. 1, § 4), the approval of the Commissioner of Conservation (LRS 30:22(B)), and that good faith negotiation has been conducted with the owner for acquisition of the property (LRS 19:2(5)). After these prerequisites have been established the amount of just compensation under LSA Constn. Art. 1, § 4, is to be judicially determined. Compare LRS 48:441 and LRS 19:2 et seq.

Obviously in an effort to expedite a Title 19 expropriation, the legislature requires that a defendant file all of his defenses within 15 days after he has been served with notice of the trial date. This requirement prevents a defendant from raising defenses piecemeal and protracting the litigation. LRS 19:6, 7.

Southern Natural filed 75 suits in 1979 for expropriation in this project in the Bear Creek field in Bienville Parish, only 15 of which remained pending for trial in September 1980. Earlier in 1980 in appeals in nine cases, we noted that the trial court had found the requisite good faith negotiation, the approval of the Commissioner, and the necessary and public purpose of the project. Southern Natural Gas Co. v. Poland, 384 So.2d 528 (La.App.2d Cir. 1980). Writs were denied by the Louisiana Supreme Court. 386 So.2d 363 (La.1980).

Thereafter, and shortly before the September 1980 trial date, in nine of the cases here appealed, defendants-appellants filed exceptions, pleas of unconstitutionality, and motions to continue the trial. The trial court dismissed the suits on an exception which attacked the Commissioner's order approving the storage of gas in the reservoir, but did not rule on the plea of constitutionality or on the motion for continuance. We granted supervisory writs, reversed the trial court, overruled the exception attacking the Commissioner's order and remanded the cases for trial on September 10, 1980, stating in an unpublished order on September 8, 1980:

"Even if these exceptions were timely filed and [even] if Bienville Parish is a parish of proper venue in which to question the sufficiency of an Order of the Commissioner of Conservation (which questions we do not now reach), we find the Order of the Commissioner of April 20, 1979, to be in compliance with LRS 30:22."

The Louisiana Supreme Court upheld this order by denying an application for review of this order. 380 So.2d 80 (La.1980). The trial court then denied a continuance and these cases proceeded to trial.

After a five day trial on the taking issue, the trial court found that the proposed expropriation was for a public and necessary purpose, that Southern Natural was a corporation authorized to expropriate and had obtained the proper order or orders giving the approval of the Commissioner of Conservation, and that Southern Natural had negotiated in good faith with the owners before petitioning for expropriation. After this ruling the compensation issue was tried and determined by the court.

ASSIGNMENTS OF ERROR 1-6

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