Case Name: The SUPERIOR OIL COMPANY v. HUMBLE OIL AND REFINING COMPANY, Inc. and the California Company
Court: Louisiana Supreme Court
Jurisdiction: Louisiana
Decision Date: 1970-11-09
Citations: 257 La. 207
Docket Number: No. 50206
Parties: The SUPERIOR OIL COMPANY v. HUMBLE OIL AND REFINING COMPANY, Inc. and the California Company.
Judges: BARHAM, J., concurs.
Reporter: Louisiana Reports
Volume: 257
Pages: 207–217

Head Matter:
241 So.2d 911
The SUPERIOR OIL COMPANY v. HUMBLE OIL AND REFINING COMPANY, Inc. and the California Company.
No. 50206.
Nov. 9, 1970.
Dissenting Opinion Nov. 20, 1970.
Rehearing Denied Dec. 15, 1970.
McCloskey, Dennery & Page, Joseph McCloskey, J. William Vaudry, Jr., New Orleans, Barham, Wright, Barham & Dawkins, Charles E. Barham, Ruston, for plaintiff-appellant.
Bernard J. Caillouet, New Orleans, Lancelot P. Olinde, Edward de la Garza, Milling, Saal, Benson, Woodward & Hill-yer, Lawrence K. Benson, John C. Christian, New Orleans, for defendants-appellees.

Opinion:
HAMITER, Chief Justice.
The Superior Oil Company seeks a monied judgment herein in the sum of $116,966.24, with interest, against Humble Oil and Refining Company and Chevron Oil Company (formerly The California Company). The suit involves the interpretation of a joint contract and a contemporaneously executed letter agreement (both signed on June 2, 1960) under which-the Mrs. C. B. Hernandez No. 1 well inu Acadia Parish was drilled and developed.-
Without an answer having been filed by" the defendants, and without a trial on the' merits resolving the dispute over the contract and the letter provisions, the trial judge dismissed the action on an exception of lack of jurisdiction over the subject matter and also on pleas of prematurity, the latter being based on the failure of plaintiff to first seek to have the cost allocable by the Commissioner of Conservation respecting the two sands encountered during the drilling of the well.
The Court of Appeal, concluding "the Commissioner of Conservation has no jurisdiction primary or otherwise to determine this controversy which involves a contractual dispute between the parties", overruled the exceptions of lack of jurisdiction. That court, however, under the prematurity pleas interpreted the contract and letter agreement, and it dismissed plaintiffs suit. The Superior Oil Company v. Humble Oil and Refining Company, La. App., 226 So.2d 565.
We granted this application on the contention of the Superior Oil Company that the court's interpretation of the contract dispute between the parties on the pleas of prematurity (if allowed to stand) will. have the effect of res judicata in any subsequent suit it may bring to have its share of the well costs adjusted under the contract provisions once they have been determined by the Commissioner of Conservation, despite the fact its suit was dismissed by the Court of Appeal "without prejudice at plaintiff's cost." The Superior Oil Company v. Humble Oil and Refining Company, 255 La. 233, 230 So.2d 89.
There is unquestionably a serious and irreconcilable divergence of opinions between the parties as to their rights under the contract and the letter agreement of June 2, 1960, the terms of which need not be set out here in view of our appreciation of the case. This can only be resolved on the application of legal precepts and principles governing the interpretation of contracts, after a trial on the merits, during which all pertinent facts touching on the intent of the parties as reflected by their actions are shown.
Inasmuch as this is, thus, a contract dispute pure and simple which the Commissioner cannot resolve in a cost dispute (should one develop after the rights of the parties under the contract and letter agreement have been determined following a trial on the merits) we hold that the pleas of prematurity are unfounded and will have to be overruled.
For the reasons assigned the judgment of the Court of Appeal is annulled and set aside, the pleas of prematurity are overruled, and the case is remanded to the district court for a trial on the merits. Costs relative to the prematurity pleas are assessed against the defendants. All others shall await the final determination of the litigation.
BARHAM, J., concurs.