Title: Adobe Oil & Gas Corp. v. Getter Trucking, Inc.

State: wyoming

Issuer: Wyoming Supreme Court

Document:

Adobe Oil & Gas Corp. v. Getter Trucking, Inc.1984 WY 12676 P.2d 560Case Number: 83-115Decided: 01/26/1984ADOBE OIL & GAS CORPORATION, OXY PETROLEUM, INC., McCORMICK PROPERTIES, INC., McCORMICK OIL & GAS COMPANY, FANNIN BANK AND GLENN HARRIS, JR., TRUSTEE, APPELLANTS (DEFENDANTS),

v.

GETTER TRUCKING, INC., APPELLEE (PLAINTIFF).

Supreme Court of Wyoming
ADOBE OIL & GAS 
CORPORATION, OXY PETROLEUM, INC., McCORMICK PROPERTIES, INC., McCORMICK OIL 
& GAS COMPANY, FANNIN BANK AND GLENN HARRIS, JR., TRUSTEE, APPELLANTS 
(DEFENDANTS),

v.

GETTER TRUCKING, INC., 
APPELLEE (PLAINTIFF).

Appeal from the District 
Court, CampbellCounty, Paul T. Liamos, Jr. 
J.

B.J. Baker of 
Brown, Drew, Apostolos, Massey & Sullivan, Casper, for appellants.

Dan R. Price II 
of Morgan, Brorby, Price & Roberts, Gillette, for appellee.

Before ROONEY, C.J., and THOMAS, ROSE, BROWN and 
CARDINE, JJ.

ROSE, 
Justice.

[¶1.]     This action was 
commenced by appellee Getter Trucking, Inc., as plaintiff, against appellants 
Adobe Oil & Gas Corporation, Oxy Petroleum, Inc., McCormick Properties, 
Inc., McCormick Oil & Gas Company, Fannin Bank and Glenn Harris, Jr., 
Trustee, to foreclose a lien under and by authority of the provisions contained 
in Title 29, Ch. 3, W.S. 1977 (1981 Replacement). Appellants were the owners of 
an oil and gas lease and Oxy Petroleum, Inc. was the operator of the lease for 
itself and the other appellants. Appellee Getter Trucking, Inc., under an oral 
contract with John E. Burns Drilling Company, had furnished labor and materials 
necessary to transport an oil and gas drilling rig from North 
Dakota to 
appellants' lease and to set it up on the lease. John E. Burns Drilling Company 
was a contractor that drilled an oil and gas well for appellants under a written 
agreement according to which the appellants urge that the drilling company 
agreed to pay for the move-in and set-up of the rig on the leasehold.1 Appellants therefore refused to 
honor or pay the amount of the Getter Trucking, Inc. lien 
claim.

[¶2.]     It was the contention 
of the appellants owners of the lease that the trucking company did not possess 
lien rights against the properties of the leasehold because there was no 
contract between appellants and the drilling company to pay for the 
transportation of the rig to and its set-up on the lease. The appellants also 
argue that they have no liability for the additional reason that Getter Trucking 
failed to comply with the notice provisions of the applicable lien statutes and 
particularly § 29-3-111, W.S. 1977. We will not, however, discuss the notice 
issue, since our decision will rest upon a resolution of the contract 
question.

[¶3.]     There was no dispute as 
to the facts of the case and the matter was tried to the court without a jury on 
stipulated and agreed facts.

[¶4.]     Appellants identify the 
following question for our resolve:

Is a third-party 
subcontractor entitled to a lien against an oil and gas lease where there is no 
contract between the owner of the lease and the contractor to pay for the 
services supplied?

[¶5.]     We will reverse the 
trial court for the reason that the trucking company did not have a lien against 
the lease since there was no contract between the owners of the lease and the 
drilling company to pay for the move-in and set-up of the rig on the 
leasehold.

Discussion of the 
Issue

[¶6.]     As has been noted, the 
appellants urge that there was no agreement between the drilling contractor and 
the appellants that they would pay for the transportation and set-up of the rig, 
in which situation the subcontractor Getter Trucking had no lien rights against 
the leasehold. The appellants go on to point out that their contract provided 
that it was, in fact, the drilling contractor who agreed to be responsible for 
these expenses - not the appellant leasehold interest owners and operators, see 
n. 1.

[¶7.]     Just here, we pause to 
take special notice of the fact that the appellee trucking company disputes the 
leasehold owners' contention that the contract does not obligate the owners to 
pay for the transportation and set-up costs. We simply cannot agree with the 
appellee in this regard. The only applicable provisions of the contract between 
the appellants and the drilling contractor speak clearly to the proposition that 
the

"* * * [c]ontractor [drilling contractor] pay 
all cost to mobilize rig and equipment to above location." (Emphasis added.) ¶ 
4.1, supra, n. 1,

and, where the 
obligations for costs and expenses are identified in ¶ 6.11 of the contract, the 
provision says clearly - and without such ambiguity as would qualify for our 
interpretation - that the "Transportation * * * Move-in" costs will be borne by 
the "Contractor." (Emphasis added.) 
Supra, n. 1.

[¶8.]     There is nothing 
ambiguous about these contract terms, and there are no other contrary provisions 
of the agreement which apply to the obligation to pay for the move-in and set-up 
of the rig. For us to attempt to find the provisions set out in n. 1, supra, to 
be ambiguous by considering other provisions of the agreement which are not 
relevant to the issue of move-in and set-up would be to undertake the writing of 
another agreement for the parties, and courts cannot do that. We will not 
rewrite contracts under the guise of interpretation. McCartney v. Malm, Wyo., 627 P.2d 1014 
(1981); Wyoming Machinery Company v. 
United States Fidelity and Guaranty Company, Wyo., 614 P.2d 716 (1980); Quin Blair Enterprises, Inc. v. Julien 
Construction Company, Wyo., 597 P.2d 945 (1979).

[¶9.]     The question is, then: 
Absent an agreement for transportation and set-up costs and services between the 
drilling contractor and the owners and operators of the lease, does a 
third-party subcontractor, having performed the set-up and transportation 
services at the behest of the drilling contractor, have lien rights against the 
leasehold?

Applicable 
Statutes

[¶10.]  Section 29-3-103(a)(iii), W.S. 19772 grants a lien to any person who 
furnishes transportation under contract 
with the owner of a leasehold. The statute simply does not give a lien to a 
party who furnishes transportation for a contractor where the contractor does 
not have an agreement with the owner to the effect that the owner is obligated 
to pay for such services.

[¶11.]  Section 29-3-104, W.S. 19773 gives a subcontractor a lien only 
to the same extent as the contractor's lien. This means that a subcontractor 
would not have lien rights in circumstances in which the contractor was not 
possessed of such rights unless the owner had agreed to pay and had paid the 
contractor for the claimed services and the contractor had not paid the 
subcontractor as was the case in Arnold 
v. American Pipe & Supply Co., Wyo., 413 P.2d 874 (1966). As applied to 
the case at bar, the drilling contractor would have no lien against the 
leasehold for transportation and set-up costs because he does not have a 
contract with the owners and operators of the leasehold to pay for such 
services.

[¶12.]  Section 29-3-110, W.S. 19774 provides that nothing in Ch. 3 
shall be construed to fix a greater liability against the owner of the leasehold 
than the price or sum stipulated by the owner to be paid for the materials or 
services furnished. Again, as applied to the facts of this case, the meaning of 
this statute is that the appellants' owners and operators of the leasehold 
cannot be obligated for services and materials that they have not agreed with 
the drilling contractor that they would pay.

Statutory 
Construction:

[¶13.]  Our well-established and familiar rule of 
statutory construction is that, if the language of a statute is clear and 
unambiguous, the courts must abide by the plain meaning of the statute. We said 
in Croxton v. Board of County 
Commissioners of Natrona County, Wyo., 644 P.2d 780, 784 
(1982):

"* * * The plain, 
ordinary and usual meaning of a word controls unless the enactment provides to 
the contrary. State v. Stern, 
Wyo., 526 P.2d 344 (1974). Where the language of the enactment is unambiguous and conveys a 
clear and definite meaning, this court must give effect to that meaning. Board of CountyCommissioners of County of Campbell v. Ridenour, Wyo., 623 P.2d 1174 
(1981)."

[¶14.]  In our effort to identify legislative 
intent, we said in Geraud v. 
Schrader, Wyo., 531 P.2d 872, 878 (1975):

"The courts must 
determine legislative intent from statutory language and not conjecture. Mahoney v. L.L. Sheep Co., 1958, 79 Wyo. 
293, 302, 333 P.2d 712, 715. Where the language of a statute is plain, 
unambiguous and conveys a clear and definite meaning, there is no occasion for 
resorting to rules of statutory construction, and the court has no right to look 
for and impose another meaning. Druley v. 
Houdesheldt, 1956, 75 Wyo. 155, 160, 294 P.2d 351, 352, reh. den. 75 Wyo. 
155, 296 P.2d 251. Courts will not usurp the power of the legislature by 
deciding what should have been said. Barber v. State Highway Comm'n., 1959, 
80 Wyo. 340, 351, 342 P.2d 723, 725."

[¶15.]  In Haddenham v. City of Laramie, Wyo., 648 P.2d 551, 553-554 (1982), we said:

"All portions of the act 
must be read in pari materia, and every word, clause and sentence of it must be 
given effect, State Board of Equalization 
v. Cheyenne Newspapers, Inc., Wyo., 611 P.2d 805 (1980); State ex rel. Albany County Weed & Pest 
District v. Board of County Commissioners of Albany County, Wyo., 592 P.2d 1154 (1979); Department of Revenue and 
Taxation v. Irvine, Wyo., 589 P.2d 1295 (1979), all with the purpose of 
ascertaining and giving effect to the legislative intent, Sanches v. Sanches, Wyo., 626 P.2d 61 
(1981); Oroz v. Hayes, Wyo., 598 P.2d 432 (1979); McGuire v. McGuire, Wyo., 
608 P.2d 1278 (1980)."

[¶16.]  When these principles are applied to the 
statutes cited above, and when the statutes are considered together, it becomes 
clear to us that the legislature intended and the statutes say that a 
subcontractor is not entitled to a lien against the leasehold unless the 
contractor has an agreement with the owner that the owner will pay for the 
services asserted in the lien.

[¶17.]  In National Supply Co.-Midwest v. Weaver, 
35 Wyo. 224, 248 P. 353 (1926) we construed the predecessor statutes of §§ 
29-3-104 and 29-3-110, W.S. 1977. The predecessor statute of § 29-3-104, W.S. 
1977 was § 4831, W.C.S. 1920, and the predecessor statute of § 29-3-110, W.S. 
1977 was § 4838, W.C.S. 1920.

[¶18.]  Section 4831, W.C.S. 1920 provided in 
pertinent part:

"Any person * * * or 
material man who shall furnish such materials * * * or supplies to a contractor 
or subcontractor * * shall have a lien upon the land or leasehold or other 
interest therein * * * and upon said oil well, gas well * * * in the same manner 
and to the same extent as the original contractor, for the amount due for such 
materials * * *."

[¶19.]  Section 4838, W.C.S. 1920 provided: 

"Nothing in this chapter 
shall be construed to fix a greater liability against the owner of the land or 
leasehold interest therein than the price or sum stipulated to be paid for such 
materials, machinery or supplies furnished, or labor 
performed."

[¶20.]  In the National Supply Co.-Midwest v. Weaver 
case, we held that these predecessor statutes meant that a subcontractor has a 
right to a lien only to the same extent that the original contractor would have 
lien rights for the material or services in question. The court, quoting with 
approval from 40 C.J. 147-148, said:

"`A subcontractor or 
other person not contracting directly with the owner, is charged with notice of, 
and bound by, the terms of the contract between the owner and contractor 
relating to the mode and terms of payment, and his contract with the contractor 
is presumed to have been made with reference to such terms. Where the mode of 
payment provided for in the original contract is inconsistent with the existence 
of a lien in favor of the subcontractors and others, they can have no lien 
unless the owner has, by his conduct, deprived himself of the right to set up 
such provisions against the lien claimed.'" 248 P.  at 355.

The court 
further quoted from Phillips on Mechanics' Liens, § 62, as 
follows:

"`The lien, or right of 
the subcontractor and others, discussed in the preceding section [§ 58], is 
always in strict subordination to the terms of the original contract between the 
owner and his immediate contractor. All such persons, in the absence of fraud, 
are presumed to have notice of the existence of such contract, a knowledge of 
its terms and of the rights and obligations of parties thereunder. Its terms are 
conclusive against them so far as any claim upon the owner or right of lien upon 
his premises is concerned.'" 248 P.  at 355.

[¶21.]  In Cities Service Oil Company v. Pubco 
Petroleum Corporation, Wyo., 497 P.2d 1368, 1373 (1972) we 
held:

"No lien can be created 
under our law without a contract with an owner or part-owner, either legal or 
equitable, upon the property upon which the lien is 
established."

[¶22.]  The Cities Service Oil Company case was 
concerned with different problems and different statutes, but the basic 
principle is applicable in this case. There was no contract between appellants 
and John E. Burns Drilling Company for transportation and set-up of the rig on 
the location, and therefore the subcontractor possessed no lien rights against 
the leasehold.

[¶23.]  The appellee urges that Arnold v. American Pipe & Supply 
Co., supra, 413 P.2d 874, stands as authority for the proposition that a 
subcontractor's lien against the leasehold may be valid even though the 
contractor could not have filed the lien. In the Arnold v. American Pipe & Supply Co. 
case, there was a contract between the leasehold owner and the contractor 
for the services and materials furnished by the subcontractor. The contractor 
had been paid in full for the services of the subcontractor but had failed to 
remit the moneys owed to the subcontractor. Since there was an agreement that 
the owner was obligated for the material and services rendered, we held that the 
subcontractor was possessed of lien rights against the owner even though, in 
that case, the contractor would not have had lien rights since he had been paid 
for the claimed services. Arnold v. American Pipe & Supply Co. is 
distinguishable from this case because in Arnold the owner had a contractual 
obligation to pay for the materials and services in question while, in the case 
at bar, the appellants' leasehold owners and operators were not contractually 
obligated to pay the contractor for materials and services rendered by the 
subcontractor, and therefore the owners came within the protection of the lien 
statutes, §§ 29-3-103, 29-3-104 and 29-3-110.

[¶24.]  We hold that the applicable lien statutes 
do not give a subcontractor rights to a lien upon an oil and gas leasehold where 
transportation and set-up costs and expenses have been incurred at the instance 
of the contractor in circumstances where the owner of the leasehold has not 
agreed with the contractor that the owner would be responsible for the payment 
of such costs and expenses.

[¶25.]  Reversed.

FOOTNOTES

1 The relevant part of ¶ 4 
of the agreement between appellants and the Burns Drilling Company 
provides:

"4. DAYWORK 
RATES:

"Contractor [the drilling 
company] shall be paid at the following rates for the work performed 
hereinunder.

"4.1 Mobilization: 
Operator [Oxy Petroleum] shall pay Contractor a mobilization fee of $-0- 
or a mobilization day rate of $-0- per 24 hour day. This sum shall be due 
and payable in full at the time the rig is rigged up or positioned at the well 
site ready to spud. Mobilization shall include: Contractor to pay all cost to 
mobilize rig and equipment to above location. Dayrates shall commence when 
rigged-up ready to spud.."

Paragraph 6 
provides in pertinent part:

"6. EQUIPMENT, MATERIALS 
AND SERVICES TO BE FURNISHED BY DESIGNATED PARTY:

"The machinery, 
equipment, tools, materials, supplies, instruments, services, and labor listed 
as the following numbered items including any transportation required for such 
items unless otherwise specified, shall be provided at the location and at the 
expense of the party hereto as designated by an X mark in the appropriate 
column.




      


    
      


    
      "To be Provided by 
      and At the Expense of
      


      "Item

    
      Operator

    
      Contractor


      * * * * * 
      


      "6.11 
      Transportation of Contractor's Property:                     
          Move in . . . . . .

    
      

      _____

    
      

      __X__


      


    
      Move out  Stack 

    
      


    
      


      


    
       Rig Off Location 

    
      __X__

    
      _____"

"To be Provided by 
      and At the Expense of

"Item

Operator

Contractor

* * * * * 
      

"6.11 
      Transportation of Contractor's Property:                     
          Move in . . . . . .

_____

__X__

Move out  Stack 

 Rig Off Location 

__X__

_____"

2 Section 29-3-103, W.S. 
1977 provides in pertinent part:

"(a) Every person who works upon or furnishes 
material, whether incorporated into the real property or not, under contract with the owner of any 
interest in real estate or with an agent, trustee or receiver of an owner has a 
lien to secure payment for:

* * * * * 
*

"(iii) Transportation and 
related mileage charges plus interest from the date due;". (Emphasis 
added.)

3 Section 29-3-104, W.S. 
1977 provides:

"Any person, who furnishes or rents any 
materials or provides any work under contract with any contractor or 
subcontractor shall have a lien on all the property on which the lien of the 
contractor may attach to the same extent 
as the contractor's lien to secure payment." (Emphasis 
added.)

We have held that the oil 
and gas leasehold estate and well of the owner may be subject to materialmen's 
liens for amounts owing from the principal contractor to materialmen when the 
owner paid the principal contractor in full, pursuant to the drilling contract, after 
the well was completed prior to receiving notice from the materialmen that they 
had not been paid by the principal contractor. Arnold v. American Pipe & Supply 
Co., Wyo., 
413 P.2d 874 (1966), discussed infra.

4 Section 29-3-110, W.S. 
1977 provides:

"Nothing in this act [chapter] shall be 
construed to fix a greater liability against the owner of the land or leasehold 
[or pooled or unitized lands, leases or interests, as the case may be] than the 
price or sum stipulated by the owner to be paid for the materials or services 
furnished or labor performed. The owner shall not have the right to offset 
obligations of the contractor unless these obligations arise out of the original 
contract." (Emphasis added.)