Viator v. Haynesville Mercantile Company

88 So. 2d 1, 230 La. 132, 6 Oil & Gas Rep. 67, 1956 La. LEXIS 1396
CourtSupreme Court of Louisiana
DecidedMay 7, 1956
Docket42395
StatusPublished
Cited by11 cases

This text of 88 So. 2d 1 (Viator v. Haynesville Mercantile Company) is published on Counsel Stack Legal Research, covering Supreme Court of Louisiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Viator v. Haynesville Mercantile Company, 88 So. 2d 1, 230 La. 132, 6 Oil & Gas Rep. 67, 1956 La. LEXIS 1396 (La. 1956).

Opinions

SIMON, Justice.

Plaintiff instituted this suit to have the mineral royalty interest conveyed by him to defendant declared extinguished by the prescription of ten years liberandi causa.

Defendant, contending that prescription had been interrupted by certain drilling operations conducted on said land, refused the demand of plaintiff to voluntarily cancel the mineral deed in question.

Upon trial on the merits, the district court rendered judgment in favor of plaintiff, decreeing that the royalty interest conveyed by him to defendant had prescribed and therefore reverted to plaintiff. Attorney fee in the sum of $300.00 was awarded in favor of plaintiff. Defendants have ap^pealed from said judgment.

The record reveals that this case was submitted for decision on an agreed stipulation of facts entered into between the parties, which are substantially as follows:

By deed dated March 16, 1940, plaintiff, Paul Viator, conveyed to defendant, Haynesville Mercantile Company, Inc., Trustee, a Vsz mineral royalty interest in the following described tract of land owned by plaintiff and located in Vermilion Parish:

13.4 acres, more or less, in Fractional Section 13, Township 13, South, Range 4 East, being a tract of land triangular in shape, and bounded on the North and East by Public Road, West by Edoris Meyers, and South by Grantor.

[135]*13527.57 acres, more or less, in the northern portion of the Northwest Quarter of Section 24, Township 13, South, Range 4 East, and 'bounded on the North by Edoris Meyers, and grantor, South by Sevignier Touchet, West by Estate of Eli Dugas, and East by the Public Road.

On June Í4, 1948, more than eight years after the said sale of royalty interest, Via-tor executed an oil, gas and mineral lease in favor of Union Oil Company of California, having a primary term of five years and covering the same land. Under paragraph 4 of said lease the lessee was authorized to pool or combine the land covered thereby with other land, lease or leases in the immediate vicinity thereof for the purpose of producing oil, gas and other minerals. The defendant to whom the mineral royalty interest under said land was conveyed was not a party to the said lease nor did it execute any other instrument authorizing the pooling thereof.

No well was drilled on the Viator tract. However, on April 24, 1949, the lessee, Union Oil Company of California, commenced the drilling of a well known as “Louise Thibodeaux No. 1” on a tract of land owned by Louise Thibodeaux. On or about June 4, 1949, this- well was completed as one capable of producing gas and condensate in commercial quantities but was shut in on the same day, there being no available market. The rules and regulations of the Commissioner of Conservation prohibit the production of gas and other minerals in a well in the absence of a market. Except for testing purposes, no oil, gas or mineral was produced from the above well from June 4, 1949 to January 18, 1951, when a market for the production was secured. The Union Oil Company has produced and is presently producing gas and condensate in commercial quantities therefrom.

Within ten years of the sale of the royalty interest here in dispute, on February 13, 1950, the lessee, Union Oil Company of California, executed and filed for recordation an instrument creating a unit for production of gas and condensate comprising a specific area of 320 acres, more or less, designated as “Louise Thibodeaux Unit V”. Among other lands, this unit included a portion of the tract leased by Paul Viator which is subject to the said royalty interest herein in dispute, the Louise Thibodeaux tract on which the aforesaid well was located, and the lands of Basil Sonnier. The Sonnier mineral lease in favor of Union Oil Company of California did not authorize the formation of a unit such as the one declared upon by the said lessee.

Apparently aware that it had improperly included the lands of Basil Sonnier within its first declaration of unitization, on October 31, 1950, lessee secured from Basil Sonnier an amendment to his lease authorizing the pooling of his land with other lands and leases for production purposes. It is significant that this amendment made [137]*137no reference whatever to the Louise Thibodeaux Unit V which had been declared February 13, 1950. It is also significant that this amendment was executed more than ten years and six months after the date of appellant’s acquisition of its Vz2 royalty interest from Viator.

Having thus obtained an amendment to the Sonnier lease, Union Oil Company of California by act dated February 12, 1951, filed a second declaration of unitization, pooling the identical acreage it had pooled and unitized by its declaration of February 13, 1950. Clearly, the declaration filed on February 13, 1950 was an unauthorized attempt to pool the land of plaintiff with the land leased from Sonnier, the latter not having authorized the same under his mineral lease. Thus, the question presented is whether the declaration of February 13, 1950, is invalid for this want of authorization by the original Sonnier lease.

The identical factual issue here presented was recently considered by us in the case of Union Oil Co. of California v. Touchet, La., 86 So.2d 50, 53. The Louise Thibodeaux Unit V, declared on February 13, 1950, is the same unit, the formation of which was relied upon by the royalty owners in the Touchet case in their attempt to show the interruption of prescription and which is now again relied upon as a basis for the interruption of prescription in the case at bar. In the Touchet case, we said:

“Since the Louise Thibodeaux Well No. 1 was not located on the lands subject to the royalty right, there was no production from this tract and the royalty right here in dispute has prescribed for want of production, unless the operating unit formed by means of the declaration filed by the Union Oil Company on February 13, 1950, within 10 years of the date of the royalty sale, was valid; for, if so, then the area comprising the unit is treated as one tract and one lease, and production from any portion of the area making up the operating unit has the same effect on property situated within the unit as if the well was drilled and completed on each of the various tracts of land embraced in the area and itnder each of the leases. Accordingly, if the operating unit formed by the first declaration filed by the oil company was valid and effective, the royalty right has not prescribed.” “[Footnote 1.] The second declaration discussed herein was filed by the oil company more than 10 years after the date of the royalty sale.”

In the instant case, Viator expressly granted to the lessee the right “to pool or combine the acreage, royalty or mineral interest covered by this lease, or any portion thereof, with any other land, lease or leases, royalty and mineral interests in the immediate vicinity. * * * ” We must necessarily conclude, as we did in the Touchet case, supra, that said right and authority granted by Viator to his lessee could be construed to mean only that such [139]*139unitization should be with other leases in the immediate vicinity in which the lessee had authority to unitize. The declaration of February 13, 1950, having included within the unitized area the lands of Basil Sonnier, without his authority or consent, with that of the land of Viator and thus being an invalid unit, could not therefore serve as a basis for the interruption of prescription.

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Viator v. Haynesville Mercantile Company
88 So. 2d 1 (Supreme Court of Louisiana, 1956)

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Bluebook (online)
88 So. 2d 1, 230 La. 132, 6 Oil & Gas Rep. 67, 1956 La. LEXIS 1396, Counsel Stack Legal Research, https://law.counselstack.com/opinion/viator-v-haynesville-mercantile-company-la-1956.