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In Mary et al. QEP Energy Company  the question was, given an encroachment of a pipeline onto the property of another, what is the test for determining the good faith, or not, of the party in possession?

Ms. Mary and QED were parties to a Pipeline Servitude Agreement and what appears to be an oil and gas lease (the court could have just called it that). Ms. Mary  et al claimed that QED’s gas pipelines unlawfully extended onto their property by 31 feet and 15 feet and sought disgorgement of the profits derived from the pipelines. The issue was to determine the source of the liability of QED, the encroacher, which would determine damages.   
Continue Reading What is the Test For Good Faith in the Louisiana Civil Code?

Co-author Chance Decker

How long – if ever – has it been since you pondered the difference between a “tenancy in common” and a “joint tenancy”? Same for us, until the wheels came off a family relationship and a lawsuit was filed in Wagenschein v. Ehlinger. This brings to us – and you – the opportunity to review a little Texas property law. Landmen and title examiners, perk up.

Tenancy in common v. joint tenancy
Continue Reading Tenancy in Common and Joint Tenancy Explained

Today is a two-fer. The questions: When does the “merger doctrine” not work in Texas, and how do courts treat technological developments created after a contract becomes effective?

In Murphy Land Group LLC v. Atmos Energy Corporation, Atmos constructed and operated pipelines under three easements from the ‘50’s and ‘60’s and the parties had a 2012 Roadway Lease granting Atmos a 40 foot roadway lease, which expired under his own terms in 2015.

The merger doctrine
Continue Reading Smart Pig Technology … and the Texas Merger Doctrine

Confess … Confess!

When  you prepare, review and/or sign settlement agreements you sometimes pay less attention than you should to the details of those “standard” releases! Acme Energy Services, d/b/a Big Dog Drilling v. Staley et al. says, Beware the “boilerplate”; before signing consider what you are actually trying to accomplish.
Continue Reading Broad Settlement Discharges Mineral Liens

Co-authors Niloufar Hafizi and Mauri Hinterlong

In resolving disputes among the mineral interest family, there is no bright-line rule delineating the duty of the executive right holder. In Texas Outfitters Limited v. Nicholson, the Texas Supreme Court explained why. The Court last addressed executive rights in 2015 in KCM Financial v. Bradshaw, where the executive allegedly colluded with a lessee for lease terms favoring itself at the expense of the non-executive. Texas Outfitters presented an oppportunity for the Court to apply the KCM guidelines to a different scenario: whether the executive breached the duty by refusing to lease.

(Spoiler alert: Yes.)
Continue Reading Executive Right Holder Liable for Refusing to Lease

Co-authors Ethan Wood and Chance Decker

Less than a year ago, we discussed the “Unanswered Questions” left in the wake of Devon Energy Prod. Co., LP v. Apache Corp. (which did answer the question, “Who is a ‘Payor’ Under the Texas Natural Resources Code?”). We asked:

“But if the non-participating working interest owner is not paying royalties—what is keeping the lease alive? Absent pooling of the leases or a JOA, the non-participating working interest owner cannot rely on the operator’s actions to perpetuate its leases. A sly operator can obtain top leases from the non-participating working interest lessors and run out the clock on those leases …”

In Cimarex Energy Co. v. Anadarko Petroleum Corp., the operator did just that …
Continue Reading Operator Runs Out the Clock on Co-Tenant

Co-author Chance Decker

 Burlington Resources Oil & Gas Company, LP. v. Texas Crude Energy, LLC et al is another chapter in the back-and-forth over deduction of post-production costs from royalty payments. In “clarifying” (royalty owners might say “retreating from”) Chesapeake Exploration & Production, LLC v. Hyder, the Texas Supreme Court held that a royalty delivered into the pipeline or tanks is akin to a royalty delivered “at the wellhead.” The lessee was entitled to deduct post-production costs from its royalty calculation, notwithstanding that the calculation was based on the “amount realized” from downstream sales.

Don’t read too much into it?
Continue Reading Texas Supreme Court Clarifies Hyder

Co-authors Chance Decker and Ethan Wood

Marsha Ellison v. Three Rivers Acquisition, LLC, et al. reminds us what is required for an instrument to be a conveyance and what is required for a stipulation to be effective.

When J.D. Suggs died in 1925, his heirs agreed to swap land with the Noelkes, and executed the Suggs Deed conveying several tracts to the Noelkes. One tract was described as “all of … the lands located North and West of the public road which now runs across the corner of [the survey], containing 147 acres more or less.”  There was a problem: There were actually 301 acres in the section northwest of the public road.
Continue Reading A Lesson in Property Stipulations

Co-author Ethan Wood

We told you to “Beware of Strips and Gores” back in 2012 and today we bring you Green et al v. Chesapeake et al, the sequel. Unlike cinema’s greatest follow-ups, this entry feels more like an unneeded rehash of the original. Nevertheless, it is a good refresher on the topic.

Rules for the Genre

The strip-and-gore doctrine operates to pass title to lands in addition to the lands described in a conveyance when:

  1. The adjoining land is relatively narrow, small in size and value in
    comparison to the expressly conveyed land, and no longer important or valuable to the grantor of the larger tract;
  2. The adjoining land was not included in the property description in the deed at issue; and
  3. No other language in the deed indicates that the grantor intended to reserve an interest in the adjoining land.

Continue Reading Strip and Gore 2: The Sequel

In a ruling that could benefit mineral owners who don’t regularly examine county deed records (to-wit, you?) the Supreme Court of Texas in Carl M. Archer Trust No. Three et al v. Tregellas held that the discovery rule delayed the running of the statute of limitations on behalf of the holder of a recorded right of first refusal to purchase mineral interests.

The trustees sued the Tregellases for buying the minerals without allowing the Trust to exercise its ROFR, contending that a contract was formed when they sued more than four years after the Tregellases’ purchase; the suit was their acceptance of the right to purchase the minerals, they said.

According to the Trellgases, the claim was barred by limitations because the suit was filed more than four years after the sale. The trustees responded that even if that were so, limitations should be delayed because they they had no obligation to search the county deed records.

The discovery rule described …
Continue Reading Texas High Court Invokes the Discovery Rule