on schedule today is seventeen dash one three seven four they verses anadarko talk about oil and gas commission can approve it or not but i think under a common law guarantee test the common law says that you have to balance the reasonable competing interests of the surface owner and the underlying mineral owner and we just and judge krieger the trial court declined to apply the common law test there is no argument on appeal your honor i don't because there was a deed because there was a deed i'm sorry judge martin because there wasn't a deed and the language of that deed is what she sought to apply and we are just dealing with the guarantee test here well i think the question as to that test doesn't reflect the specific language of the deed correct i think the issue on appeal is not the oil and gas commission rules that judge kelly cited i think the question judge krieger when the deed was executed does that convenient or necessary language very and expand the rights that they had under the common law under gary and joe let me ask you something because it's very confusing to me because you seem to have shifted position in the pellet court and from what you are arguing in the district court here you're arguing that convenient or necessary is synonymous with reasonably necessary which is the common law standard in the district court you very clearly argued that they met different things why can you come in here and take a totally different position and you took in the district court i mean you told the district court to interpret them differently that they weren't the same well we told the district court our initial argument a summary judgment was that they were more protective of the surface older than is the common law even right and so we did that we said convenience should be judged in gauge practice we put on a case then dealing the hand we were dealt with we said ok we're going to show why it's in our view on reasonable and then she said you have not satisfied at the close of six days of trial she said you have not satisfied my modified test of character ok so i think the question is we have two arguments that appeal that's our second argument is the one we made specifically the trial court but we were we put on a case when we were told that you are allowed to prove commercial unreasonable this we said here's why under all the facts o circumstances in their totality this is an unreasonable use of the surface to extract your underlying guess we've got we put on a case show an unreasonable she said you did not meet my standard of gary now we're up here in appeal saying that that standard garrity was was not only to unfavorable to those that we should have had to carry pest we also said we should have a pest even better than gary so those two are intimate and people that we should be able to make an unreasonable test under guarantee and if you disagree that we should have an even a test more protective then guarantee that convenience should be judged from our perspective so i think when we put out a case understand and say here's what we prove and reasonable this and she says well i might cite satisfy garrity but i've modified garrity i think we're entitled under that standard to say that our test meets the appropriate standard of common law reasonable this or unreasonable this and this by the way this is a bellwether test a bellwether case in her words originally certified  class action or not but this is a case that is going to govern not just the base is very important interests in there one farm but other farms and other home interests that she has stayed so i think it's incumbent on this court i would urge the court to say what is the appropriate test does the and insert judge march's question i'd like to say why we believe that dede does not modify and supplant the garrity test and really i think really does not modify but i would say  suitable which with a very definitions of reasonableness and necessary in conjunction and disjunction was said it's not absolutely necessary but it's that which may be convenient and i think that the classics and i think the district court  most exactly greed with you in terms of what she held the convenient means she said she explained in the attachment i can't i don't have the transcript page here but she said such a construction honors the plain meaning of the term convenien allowing anadarko to choose the alternative it deems most suitable in a given situation but she and she and she and by that she meant commercially reasonable well commercially reasonable that's a standard that she made up there's really no th she applied it in a more modern understanding of easy it's convenience it's something that i didn't see that anywhere in in the terminology well that's how she got a easy she said if it's at their convenience she said it's from their perspective it's at their balancing and reasonable this is a standard she said i'm going to apply something different than overall reason she like most of the cases from the states act in the early one thousand nine hundred said that convenience broadens necessary terms which appear not only in lots of deeds but also in lots of statutes are interpreted as one party's perspective best one term and as to another party's perspective as to another term well that's our secondary issue our first one and i think most of the cases construe them harmoniously as reasonable yes i think if you look at the p u c standards convenor necessary means reasonable i think if you look at chief justice marshall mcculloch versus maryland they said necessary and proper clause said necessary is not absolutely necessary something that make be lawful end i think they are harmonious that's our first point is that as understood in one thousand zero seven convenient or necessary meant reasonably necessary and that's exactly how this court in baka ninety seven one cherry from whose perspective it's reasonable for both parties respective balance the interests but if it's not reasonable from the buyer standpoint it could be reasonably and necessary and the most economical from the producers to have that's exactly who's going to guarantee that expense to do directional drilling and if your clients turned that down and they turned down one hundred thousand dollars offer to do it that way what is the issue it was that offer that the pay but the statutory issue judge kelly if i could just say th battery issue is not in this case it was not relied on by the district court and it doesn't control the way i believe you're saying it controls what's controls in this case with the bead language and our point on that the aid is convenient or necessary is a balancing unnecessary for who and i could use three or four that would be unreasonable and you have to balance and that's a point perspective is both perspectives and that's what gary says you balance it in a trial or fact bounce it says under all the facts  circumstances was this a reasonable use of the surface land to get your mineral it and it's a balancing and that's our primary did you have to put on any evidence that vertical drilling was an reasonable that well yes but  and in this case that when you could have and should have in our view used only to well sites and you could have done that with directional drilling that we should have to put on evidence that it was an reasonable at that it during that time period for an owner of the mineral estate to use vertical drilling instead of directional our position was that it was an unreasonable balancing of the interest it could and should have been done otherwise we did not put on it and we lost the case because the judge said you didn't prove whi it please the court david palmer on behalf of defendant happily anadarko you your honor judge morris for pointing out that this case is different from garrity as chief judge krieger held in two very thorough pretrial opinions orders one in july of twenty fifteen and the other in march of twenty seventeen in both of those cases he wrote extremely thorough and extremely thoughtful analyses of the points all three judges made here today the deed itself your honor which is exhibit to accept and reserves to union pacific railroad company and its successors the right to use so much of said lamb as may be convenient or necessary as judge krieger pointed out  both were presented with arguments much like what you just heard that you need to split those terms apart or here now a change of position as you pointed out judge mchugh they either mean both the same thing or you should look at it from the point of view necessary from the point of view of the owner of the minerals and convenient from the point of view of the surface owner the deed doesn't say anything about commercially reasonable doesn't no no what the common law said and what carrot he set is the actions of the exploiter the remover of the minerals needed to be reasonable the fact of the matter it scares me reasonable when you're talking about a mineral a state has to include impact on the surface doesn't it absolutely and what that discord held in baka was this is not if i'm an a darko and i have a choice between directional or direct drilling or vertical and direct and i want is a lot cheaper but it tears up a lot more of the surface i'm always going to think it's more convenient for me to pay for the cheaper one are your honor the number one i'm sorry to smile but not necessarily and in fact what happened here was mischaracterized in the reply brief and here again today an oral argument the first three were the first three wells which were drilled on the south parcel by noble not going at arco were all vertical wells in that instance noble said to mr bay by his testimony we can do a directional well but it will cost one hundred thousand dollars more are you willing to pay it and he said no and in fact he entered into three surface damage agreements for those first three wells then several years later he went back noble not anadarko entered arcos never set foot on this farm noble went back to m barry and said ok we're now ready to start some growing on the north farm and they said to him and this is his testimony we will drill directionally and there was no mention of additional costs what happened at that time which was several years later and this is in the record your honor in mr bass testimony and cross that he refused that offer to drill direction refused it why his testimony was because he had already filed this lawsuit now this was his conversation with noble anadarko had no involvement in this there is no evidence that anadarko was involved he said no and so noble went back and said ok we'll drill the vertical wells a vertical well there are photographs your honor in the record of the vertical wells on the north and south parcels these are a whole series of exhibits and they appear at twenty one forty six and thereafter these vertical wells the night not going to show that he's there in the record but they're very small even mr barry testified that the wellhead is at most ten by fourteen and i want to focus you on the district court  applying colorado law departed from the burdened shifting framework of garrity that would have allowed i mean this is the i think the elephant in the room i mean the plaintiffs think they have a right to have the jury decide whether this is convenient or necessary and by changing the third prong of that test the court here said that there's a burden on the plaintiffs before they can get to the jury to show that when there are two choices available to the surf the mineral estate owner that you have to prove or you have to bring in evidence want that the choice that they went with was on commercially reasonable is that something the federal district court ought to be doing changing colorado law about not only burden shifting frameworks or how they interpret deeds when this is a bellwether plaintiffs for huge group your honor what the district judge held below in both of her rulings was that the plaintiffs had a responsibility of bringing forth evidence of either the use of greater surface plaintiffs never did that by the way there's no testimony in this record that a directional weld uses x feet by x feet and that that is less than these vertical wells there's no testimony to that and in fact judge kelly you're spot on in pointing out that their expert witness pointed out in his testimony that in order to deliver a directional well you need to use at least ten acres of land whereas to drill a vertical well during the drilling you use about two and a half acres of land and then of course once the well is in you get down to these very small footprints of well heads that i suspect we've all seen neither mr bay nor his expert ever testified that vertical drilling here was unreasonable they only went so far as to say or to opine mr mccartney said that that directional will drilling was feasible but no witness ever testified as to how much surface area would be disrupted or used is there anything to test as modified by the district court is there anything in that test that reflects the interest or determines the interest i guess of the of the surface owner and what might be reasonable to them will certainly your honor had i don't see then had the money either since our it's under the modified test well i don't think she modified disagree or i think what she said was in order to get to the jury you need to show unreasonableness right in that state and they didn't they were to fire them to show that the method that you chose was unreasonable is a modification of gar isn't it i think under common law parity and or under the deed language at issue here plaintiffs had a duty to show they had a burden of proof to me to show that the directional drilling here was unreasonable or the vertical drilling was unreasonable or one was more reasonable than the other and they don't not do that and they confessed that when she asked them out at the close of evidence under stuff won the plaintiff just asked to show that the operator's conduct materially interfered with surface uses that's all they have to show they don't have to do anything about reason a village step to the surface owner comes in facie case is made and they can present evidence by an expert whatever that what they did was reasonable and necessary from the perspective of the operator then step three the finder of fact i eat the jury gets to decide whether when the rebuttal evidence is presented which is correct and so you get to a jury jury much easier under guarantee as i read it then you do under what the district court did here well i respectfully disagree that you get to the jury much easier i know that that's what the plaintiffs are urging for here they want to get to a jury at all costs in this case they want that her jury to be on guided by legal principles and to be unguided by real evidence as to surface disruption as to the reasonability as between the two methods there was no testimony your honor that as to the relative costs i guess i'm still confused as to where that comes in and the regular garrity standard as i see the third step on the rebuttal the  saying under the traditional tester they have to show that the method chosen was unreasonable which is what we were requiring well commercially and reasonable in order to prove that something is reasonable you have to have a showing that there is some other reasonable alternative don't you it would seem to me and hear what trial counsel said in response to the question of the court at page nine thirty of the transcript have you made any showing that vertical drilling was commercial excuse me directional drilling was commercially unreasonable and i don't and then as the lawyer says we did not put on the evidence that vertical  alternative is unreasonable but that here's another one i guess and that's what really does even go that star your honor what they proved was that no i'm talking about the difference between what the district court did here and the traditional garrity test i'm trying to figure out what that is exactly well i think she put the plaintiff's on more than fair notice both in her twenty fifteen ruling her twenty seventeen ruling during the trial during which she let them put in virtually any evidence whatsoever and they still failed to show that there was anything unreasonable and is that part of the traditional garrity test i believe it is you're ok yes i'm not seeing it in the test as stated but maybe maybe that's implied well what that's what they're arguing for though your honor is that they they want the jury to make a decision based on an inadequate really a wall fully empty factual record they want the jury to simply decide do they prefer mr barry over anadarko i mean it really is that almost that crass i see that i'm virtually o the heart of the dispute and what we lost in the district court was step three the final step of parity there should be no dispute about that she said were modifying garrity to make industry practice dispositive and i think aired in a quote pages one thirty three to one thirty four gary alternately it's the province of the trier of fact to balance the competing interests of the operator and surface owner we never got that balancing the case ended when she said this is consistent with industry practice case over and no further questions asked judge kelly you said if they use ten acres they only needed you three could be unreasonable that's what happened here when used the differences to the engineer in ability of directional drilling is significantly different from vertical drilling but they didn't argue they didn't have it they said we're going to use seven well sites with seven sets of roads and seven sets of flow lines and a much more intrusive interface abuse of the surface not because we can't directly drill because we choose not to unless you pay for us and the question that the issue open issue and gary is is that reasonable and i think convener necessary the question your honor is not a convenient or necessary trump guarantee stage three and we say can be near necessary is synonymous w us now if you say it's not i mean something different we have argued it means something more protective of the surface owner because you have to look at convenience from our perspective and it really makes no sense to say convenient or necessary are opposites that they're not there opposites but both are determined from perspective mineral owner one is broad and one is easy if they said if they said we want to make it easy for the service owner they say it just make it convenient you would not say can be your necessary if there's if there antonyms we say they