Co-author Bill Drabble

Let’s set aside fracking challenges, low prices, and pipeline rejections to discuss the mundane. Should you as an owner of property be concerned about premises liability claims? We’re talking about the office environment and out in the field. What can you do to protect yourself? Gray Reed partner Bill Drabble has the answers.

Here are the highlights:

  • There is no federal legislation to protect a business from premises liability. Nor is there any in Texas. I don’t know about Louisiana, Oklahoma, Pennsylvania, North Dakota or other producing states.
  • The duty of a property owner is to use “ordinary care” to reduce or eliminate unreasonable risk of harm created by a premises condition about which the owner knew or should have known.
  • Visitors will have difficulty showing that the property owner owes a duty to eliminate Covid-19 lingering on surfaces.
  • A challenge for a complaining party is that the risk of contracting Covid-19 is open and obvious to everyone. The company is not an insurer of others’ safety.
  • Proving causation would be difficult.
  • An aggrieved party’s monetary recovery may be reduced by demonstrating that he bore some portion of the responsibility for catching Covid-19.
  • Bill has six suggestions for what a premises owner should do to protect itself.

Energy and the Law likes the drum beat. Here, to celebrate the art form, you have:

the Reggae beat, with help from the bass player,

the second line, and

John Bonham, who needed no help.

There is “new news” and there is the same-old-same-old. Today is mostly the latter but it seems more “out there” than in it used to be.

The Pennsylvania Attorney General convened a grand jury that slammed regulatory failures in Pennsylvania gas drilling and recommended setbacks that would effectively destroy the ability to develop shale resources.  I don’t know how they do it in Harrisburg but where I come from the prosecutor can get pretty much whatever result he wants by deciding what the grand jury hears and sees and what it doesn’t. Is there a discernable prosecutorial purpose?

The report is challenged as legally irrelevant and erroneous by the industry, regulators, and the state’s Democratic governor.

The 2020 Joe Biden signals his willingness to use what has been described by environmentalists as the president’s “unfettered discretion” to regulate new pipelines and LNG export facilities to death. To be fair, the substance of the article is more benign than the headline.  It’s been said that Mr. Biden has generally taken positions in the mainstream of Democratic politics. As the party moves leftward, you can expect him to follow.

Democrats in the U S House plan for the “climate crisis”. The 547-page legislative proposal calls for 100 percent clean energy by 2040 and mandates US automobile makers to sell only zero-emission cars by 2035. It will cost trillions.

Under the cover of COVID the government should just expropriate the industry. In a slow-pitch softball interview with Truthout, one Michael Pollin combines utopian fantasies with moral condemnation of an industry that has made the world a better place, to create:

  • “ … a clear path for giving [the oil and gas industry] more than what they actually deserve, …
  • a well-thought-out plan for relatively painless death over the next 20 years or so.”
  • nationalizing the US oil and gas industry for $350-$400 billion.
  • public/private ownership of the “energy  system”, including “community and cooperative private ownership” to develop smaller scale ownership with a …
  • transformation to a system that relies primarily on solar and wind power “with all economic sectors operating at high efficiency.” … maybe like the $1.4 Billion of CARES money flowing to dead people.
  • … “retraining and relocation support as needed for a ‘just’ transition” with …
  • “large-scale investments in heavily impacted communities.”

Is it bloated, all-powerful government or the lamentable Road to Serfdom?

Daniel Markind follows his recent Forbes report on rejection of pipeline permits by two northeastern states with a more recent report showing the folly of both “environmental extremists and fossil fuel apologists” because of the massive Russian fuel spill.

We still love the USA on this 4th of July, don’t we?

 

In combined cases featuring California cities of San Francisco, Oakland and San Mateo and several California counties and public officials against Exxon Mobil Corporation, Texas’ Fort Worth Court of Appeal denied Exxon Mobil’s request for pre-suit discovery to evaluate potential claims for constitutional violations, abuse of process, and civil conspiracy.

No personal jurisdiction

Exxon Mobil alleged that California state court climate-change lawsuits are designed to suppress Exxon’s Texas-based speech and associational activities. The cities, counties, officials and their trial counsel filed special appearances challenging Texas’s personal jurisdiction over them. The special appearances were denied by the trial court. The appellate court determined that the potential defendants lacked the requisite minimum contacts with Texas to be subject to personal jurisdiction and reversed the trial court’s order allowing Exxon Mobil to conduct Rule 202 depositions.

In the first 47 of its 49 page opinion the court analyzes the law of special appearances, but first, as background, summarizes the climate litigation goals and strategies of Massachusetts lawyer Matthew Pawa and the gaggle of climate alarmists you’ve heard from before: billionaire Tom Steyer, the Rockefeller Family Fund, the “Green 20” Attorneys General, and the Union of Concerned Scientists. That discussion is worth a read.

The Court’s “Final Thoughts”  

In the last several paragraphs, by Justice Elizabeth Kerr, the Court took an unusual detour from the conventional judicial opinion and offered “Some Final Thoughts”

The court criticized “Lawfare” as “an ugly tool by which to seek environmental policy changes the California Parties desire, enlisting the judiciary to do the work that the other two branches of government cannot or will not do to persuade their constituents that anthropogenic climate change (a) has been conclusively proved and (b) must be remedied by crippling the energy industry.”

The court acknowledged that “Being a conservative panel on a conservative intermediate court in a relatively conservative part of Texas is both blessing and curse: blessing because we strive always to remember our oath to follow settled legal principles set out by higher courts and not encroach on the domains of other government branches;  curse, because in this situation, at this time in history, we would very much like to follow our impulse instead.

Their impulse is to ”safeguard an industry that is vital to Texas’s economic well-being, particularly as we are penning this opinion weeks into 2020’s COVID-19 pandemic-driven shutdown of not only Texas but America as a whole.”

Congratulations to the justices for honesty and dedication to the rule of law.

A musical interlude (and an under-rated artist)

Co-author Rusty Tucker

Estate of Trickett was a dispute over heirship of Claralyn Trickett, possibly the wife of Robert Bowerman (who must have forgotten to divorce his previous wife).

The descendents of Claralyn brought a quiet title action and an heirship proceeding against the heirs of Robert, who claimed an interest in his estate by virtue of his marriage to Claralyn. The trial court abated the quiet title suit while the parties fought over Claralyn’s heirship,

The result

The court agreed with the descendents of Robert that the general four year statute of limitations applied and that Claralyn’s heirs’ cause of action began to accrue in 1972 when she died. The claim was barred by limitations because they did not file suit until 2015, 42 years after she died and 38 years too late.

This was not an action to recover real property. If it were, the cause of action would not have been barred by limitations.  The real property issue was not presently before the court. The only requested relief was to have the court declare the identity of Claralyn’s heirs and the respective shares and interest of each in her estate. Continue Reading Limitations Bars an Heirship Proceeding

Co-author Robbie S. Morris

Channeling Winston Churchill, Gray Reed lawyer Robbie Morris urges caution for document writers and the clients who hire them: Drafting a deed is not, as many view it, a clerical undertaking.  Nothing can take the place of a diligent inquiry (by all parties and their counsel) into how the grantor derived the title in which he or she purports to be vested. One example would be a real estate transaction in which a title commitment contains a Schedule A or Schedule B blanket minerals exclusion, or Schedule B lists a severed mineral interest stating that title has not been checked subsequent to date.  This should be a red flag, a warning that a landman should be hired to run mineral title. Guesswork about what is being conveyed is not recommended!

Robbie also discusses he different ways in which mineral and royalty reservations and exclusions should be handled in the deed-drafting exercise. He also explains the distinction between matters affecting the quantity and the quality of the estate being conveyed and drafting nuances involving each.

For Robbie’s report, read on.

A musical interlude about a trashy part of town.

Co-author Chance Decker

The Texas Supreme Court has agreed to hear oral arguments in a dispute over an “accumulation” provision in a continuous development clause of an oil and gas lease.  The case is Endeavor Energy Resources L.P. v. Energen Resources Corp. et al.  Here’s the language:

…this lease shall terminate … [150] days after the expiration of the primary term unless during such [150] day period Lessee has commenced operations for the drilling of a well in which case this lease shall be extended  … so long as operations for the drilling of a subsequent well are commenced within [150] days after the completion of the preceding well. This lease shall terminate … any time a subsequent well is not commenced within [150] days from the completion of a preceding well. … Lessee shall have the right to accumulate unused days in any 150-day term during the continuous development program in order to extend the next allowed 150-day term between the completion of one well and the drilling of a subsequent well.

According to Endeavor, this provision allows it to accumulate the days it drills prior to the 150 day deadline like “pennies in a jar” that it can use to extend the 150 day deadline to drill any subsequent well.  Energen (and the trial court and the Eastland court of appeals) interpret the provision to apply only to the next well.  Under this interpretation, Endeavor lost its lease on all non-retained acreage.

Here is Endeavor’s brief on the merits, Energen’s brief on the merits, and Endeavor’s reply.

Endeavor argues two points: The lower court failed to construe the provisions of the clause (to them, a “retained acreage clause”) as a harmonious whole, and allowed a special limitation of the grant without the required clear and unambiguous language.

The Supreme Court will make the call. Given the Court’s professed policy to resolve contract disputes on the plain language of the agreement, our pennies are on Energen in this one. Perhaps the special limitation argument is the key.

Bonnie Pointer RIP, a good song for the times we are in.

Real author Paul Yale

You’re in for a treat today; a report from my Gray Reed partner Paul Yale on the Texas Supreme Court decision, Yowell v. Granite Operating et al, dealing with anti-washout clauses in assignments of overrides and that bane of all first year law students, the Rule Against Perpetuities.  The Court, in Paul’s view, has taken a step back from promoting title certainty by injecting the Cy Pres Doctrine into the already complex body of law pertaining to anti-washout clauses.

Common law defines the Rule Against Perpetuities this way,  No property interest is valid unless it must vest, if at all, within twenty-one years after the death of some life or lives in being at the time of the conveyance.

If you’ve forgotten, or never heard of it, the Cy Pres Doctrine means to reform a document as nearly as possible to confirm with the grantor’s intent.

For more discussion, read on.

And for a musical interlude, listen on.

 

If you follow the Marcellus shale there are political developments you should know about. Daniel Markind, a partner in the Philadelphia office of Flaster Greenberg PC, gave me permission to share this recent blog post.

Devastated By Coronavirus, New York’s Pipeline Politics Ensure A Tougher Second Round

By: This article originally ran on Forbes.com on May 20, 2020. All rights reserved.

Approximately 30% of all confirmed coronavirus cases in the United States have been reported in the New York City metropolitan area, which is located mainly in southeastern New York state and northeastern New Jersey. Last weekend, the administrations of the Governors of both states, Andrew Cuomo of New York and Phil Murphy of New Jersey, rejected once again the key permits for the Northeast Supply Enhancement Project (NESE), a natural gas pipeline that would have ensured sufficient natural gas supply to much of New York City and its environs. These decisions probably mean the death of NESE.

Click here to read the article in its entirety on Forbes.com. Continue Reading Marcellus Pipeline Permits Rejected by New York and New Jersey

Let’s begin with a quiz:

What is a “Labor” ? Assuming you met one face to face, how big is would you expect it to be?*

From Great Western. Drilling, Ltd. v. Pathfinder Oil & Gas, Inc. we learn that if you want one agreement to be conditioned on execution of another one, you’d better say so … in writing … in the first one. Texas courts look for ways to avoid conditions precedent. Continue Reading Offer to Acquire Leases Could Not be Conditioned on a JOA

Co-author Kelley Clark Morris

Geary v. Two Bow Ranch Limited Partnership* is an example of the havoc an unusual contract provision can create.

In 1981, Geary and other Grantors executed a warranty deed conveying 2,614 acres (let’s call it the Property) in Bandera County, Texas, to Meader, Two Bow’s predecessor. The Grantors reserved an undivided one-half mineral interest, and conveyed one-half. The deed conveyed to Meader the ”executory rights” to its minerals and reserved the same to Grantors over their half. The deed included this “Provisional Authority” language:

“Grantee may control the executory rights pertaining to the minerals provided the Grantors and Grantee share equally in any and all proceeds related thereto.” Continue Reading “Provisional Authority” to Control Executive Rights Not Assignable