Yates v. Marston

121 So. 3d 673, 183 Oil & Gas Rep. 32, 2013 WL 2217494, 2013 La. App. LEXIS 1007
CourtLouisiana Court of Appeal
DecidedMay 22, 2013
DocketNo. 48,009-CA
StatusPublished
Cited by3 cases

This text of 121 So. 3d 673 (Yates v. Marston) 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
Yates v. Marston, 121 So. 3d 673, 183 Oil & Gas Rep. 32, 2013 WL 2217494, 2013 La. App. LEXIS 1007 (La. Ct. App. 2013).

Opinions

MOORE, J.

| j Ruby and Son Hui Yates, their assign-ee WJD Carbon (collectively, “Yates”) and Petrohawk Properties LP each appeal a partial summary judgment in favor of Randy and Lisa Marston and Rex and Sandra Young, declaring that Marston owns one-half of the mineral servitude, and Young owns the other half subject to a one-quarter royalty interest in favor of Yates, affecting a tract of land in Red River Parish. For the reasons expressed, we affirm.

Factual Background

The tract, the 1,581-acre Ashland-Cres-cent Plantation, had been in Marston’s family for several generations. Pursuant to a testamentary trust, Premier Bank held legal title to the tract in the 1990s. In January 1995, the trust sold the tract to Young, but reserved one-half mineral rights. In 1996, the trust terminated, conveying its one-half mineral servitude to Marston. In 1997, Young sold the tract to Yates, reserving (on top of Marston’s one-half mineral servitude) one-half of executive rights and one-fourth of royalty rights. All these sales were matters of public record.

Yates sold most of the tract to the Nature Conservancy in December 2002 for $1.5 million (“the Conservancy deed”). The Conservancy deed recited:

Grantors [Yates] hereby expressly reserve unto themselves, and their heirs, successors and assigns, in perpetuity pursuant to and will the benefit of La. R.S. 31:149.1 * * * all of the subsurface oil, gas and liquid hydrocarbons in, on or under the property, including all executive rights and reversionary rights related thereto[.] To evidence compliance with the requirements of La. R.S. 31:149.1, attached hereto * * * is a certificate * * * certifying that Grantee [the Nature Conservancy] is a national, nonprofit land conservation ^organization.

In August 2003, the Nature Conservancy sold the tract to the United States by [675]*675general warranty deed. At this time, there was no mineral exploration or operation either on the tract or on units that included it.

In March 2008, Yates granted an oil, gas and mineral lease to Delta Lands; two months later, Delta Lands assigned lessee’s rights to Petrohawk. Later, Yates transferred whatever mineral rights he might have had to his subsidiary, WJD Carbon. In late 2008, Petrohawk began drilling seven wells in the Haynesville Shale, on units that included the tract. Apparently, Petrohawk paid all bonuses and royalties to Yates.

Yates filed this suit against Marston in October 2009, in essence to quiet title and obtain judgment declaring that Yates owned the mineral rights to the tract. Marston reconvened, asserting the servitude rights he reserved in the 1995 deed. In early 2010, Marston amended his recon-vention to join WJD, Yates’s assignee, and Petrohawk, Yates’s lessee, as defendants in reconvention. Then Young intervened, aligning himself with Marston, asserting the servitude rights he reserved in the 1997 deed.

The Statutes and Motion for Summary Judgment

Marston and Young filed the instant motion for partial summary judgment on the issue of imprescriptibility. At the time of the Conservancy deed (2002) and the U.S. warranty deed (2003), an article of the Mineral Code, La. R.S. 81:149.1, provided (in pertinent part, with emphasis added):

§ 149.1. Mineral rights imprescrip-tible when reserved in transfers of land to state or national, nonprofit land conservation organization
IsA. (1) When land is acquired from any person by an organization certified by the secretary of the Department of Natural Resources to be a state or national, nonprofit land conservation organization by conventional deed, donation, or other contract and by the act of acquisition, a mineral right otherwise subject to the prescription of nonuse is reserved, the prescription of nonuse shall not run against the mineral right so long as title to the land remains with the state or national, nonprofit land conservation organization.
(2) The state or national, nonprofit land conservation organization is only authorized to convey the property involved to another state or national, nonprofit land conservation organization, to the state, or to the federal government. If the land, or any part thereof, is transferred by the state or national, nonprofit land conservation organization, the state, or the federal government, the prescription of nonuse shall not apply.

The legislature repealed Art. 149.1 in 2004; simultaneously it amended La. R.S. 31:149, providing (in pertinent part, with emphasis added):

§ 149. Mineral rights reserved from acquisition of land by governments or agencies thereof imprescriptible
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B. When land is acquired from any person by an acquiring authority through act of sale, exchange, donation, or other contract, * * * and a mineral right subject to the prescription of non-use is reserved in the instrument * * * by which the land is acquired, prescription of the mineral rights is interrupted as long as title to the land remains with the acquiring authority, or any successor that is also an acquiring authority. The instrument * * * shall reflect the intent to reserve or exclude the mineral rights from the acquisition and their impres-criptibility as authorized under the provisions of this Section and shall be re[676]*676corded in the conveyance records of the parish in which the land is located.
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D. If a mineral right subject to prescription has already been established over land at the time it is acquired by an acquiring authority, the mineral right shall continue to be subject to the prescription of nonuse to the same extent as if the acquiring authority had not acquired the land. Upon the prescription or other extinction of such mineral right, the transferor of the land shall without further action or agreement become vested with a mineral right identical to that ^extinguished, if (1) the instrument * * * by which the land was acquired expressly reserves or purports to reserve the mineral right to the trans-feror, whether or not the transferor then acqually owns the mineral right that is reserved, and (2) the land is still owned by an acquiring authority at the time of extinguishment.

Marston and Young argued that by a plain reading, Art. 149.1 A(l) (hereinafter, “Subsec. A(l)”) created a special rule for conveyances to conservation organizations whereby all outstanding mineral rights were made imprescriptible. Also, the Nature Conservancy’s later transfer of the tract to the U.S. activated the final clause of Subsec. A(2), “the prescription of non-use shall not apply.” They argued that the 2004 amendment to Art. 149 could not be applied retroactively as this would divest them of a substantive right, specifically, the imprescriptibility of a mineral right as recognized in Heirs of Viator v. TriParish Investors Ltd., 618 So.2d 36 (La. App. 3 Cir.), writ denied, 625 So.2d 167 (1993). Alternatively, they argued that if the 2004 amendment revoked their impre-scriptible' right, it restarted a 10-year period of nonuse during which Petrohawk’s operations began.

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Bluebook (online)
121 So. 3d 673, 183 Oil & Gas Rep. 32, 2013 WL 2217494, 2013 La. App. LEXIS 1007, Counsel Stack Legal Research, https://law.counselstack.com/opinion/yates-v-marston-lactapp-2013.