Case Name: UNION TEXAS PETROLEUM, A DIVISION OF ALLIED CHEMICAL CORPORATION; Champlin Petroleum Company; Atlantic Richfield Company; Amerada Hess Corporation; Eason Oil Company; Harper Oil Company; Singer-Fleischaker Oil Operating Company, Inc.; Oklahoma Natural Gas Company; Henry H. Gungoll Associates; L. O. Ward; Carl E. Gungoll; Woods Petroleum Corporation; Odessa Natural Corporation; Mack Oil Company; Okmar Oil Corporation and Ladd Petroleum Corporation, Appellants, v. The CORPORATION COMMISSION OF the STATE OF OKLAHOMA, Harvey W. Dierksen, et al., Appellees
Court: Oklahoma Supreme Court
Jurisdiction: Oklahoma
Decision Date: 1981-07-21
Citations: 651 P.2d 652
Docket Number: No. 53181
Parties: UNION TEXAS PETROLEUM, A DIVISION OF ALLIED CHEMICAL CORPORATION; Champlin Petroleum Company; Atlantic Richfield Company; Amerada Hess Corporation; Eason Oil Company; Harper Oil Company; Singer-Fleischaker Oil Operating Company, Inc.; Oklahoma Natural Gas Company; Henry H. Gungoll Associates; L. O. Ward; Carl E. Gungoll; Woods Petroleum Corporation; Odessa Natural Corporation; Mack Oil Company; Okmar Oil Corporation and Ladd Petroleum Corporation, Appellants, v. The CORPORATION COMMISSION OF the STATE OF OKLAHOMA, Harvey W. Dierksen, et al., Appellees.
Judges: WILLIAMS, LAVENDER, DOOLIN and OPALA, JJ., concur.
Reporter: Pacific Reporter 2d
Volume: 651
Pages: 652–671

Head Matter:
UNION TEXAS PETROLEUM, A DIVISION OF ALLIED CHEMICAL CORPORATION; Champlin Petroleum Company; Atlantic Richfield Company; Amerada Hess Corporation; Eason Oil Company; Harper Oil Company; Singer-Fleischaker Oil Operating Company, Inc.; Oklahoma Natural Gas Company; Henry H. Gungoll Associates; L. O. Ward; Carl E. Gungoll; Woods Petroleum Corporation; Odessa Natural Corporation; Mack Oil Company; Okmar Oil Corporation and Ladd Petroleum Corporation, Appellants, v. The CORPORATION COMMISSION OF the STATE OF OKLAHOMA, Harvey W. Dierksen, et al., Appellees.
No. 53181.
Supreme Court of Oklahoma.
July 21, 1981.
Rehearing Denied March 8, 1982.
As Corrected March 9, 1982.
Dissenting Opinion March 9, 1982.
C. Harold Thweatt of Crowe, Dunlevy, Thweatt, Swinford, Johnson & Burdick, Oklahoma City, for Union Texas Petroleum, A Div. of Allied Chemical Corp., and Champlin Petroleum Co.
Duncan W. Holt, Jr., Dallas, Tex., for Atlantic Richfield Co.
Wyn Dee Baker, Tulsa, for Amerada Hess Corp.
Robert J. Emery of Lytle, Soule & Emery, Oklahoma City, for Eason Oil Co.
Russell F. Thompson of Monnet, Hayes, Bullis, Thompson & Edwards, Oklahoma City, for Harper Oil Co. and Singer-Flei-schaker Oil Operating Co., Inc.
John A. Gaberino, Jr. of Huffman, Ar-rington, Scheurich & Kihle, Tulsa, for Oklahoma Natural Gas Co.
Gordon F. Brown, Brown & Lockhart, Oklahoma City, for Henry H. Gungoll Associates, Wood Petroleum Corp., Odessa Natural Corp., Mack Oil Co., L. 0. Ward, Okmar Oil Corp., Ladd Petroleum Corp. and Carl E. Gungoll.
H. B. Watson, Jr., Richard K. Books, Oklahoma City, for Tenneco Oil Co. and Union Oil Co. of Cal.
Harvey Cody, Conservation Atty., Oklahoma Corp. Com’n, Jan Eric Cartwright, Atty. Gen., Oklahoma City, for Corp. Com’n of the State of Okl.
Walker, Walker & Corbyn by Barth B. Walker, Oklahoma City, for Harvey W. Dierksen, et al.

Opinion:
HARGRAVE, Justice.
This is an appeal from Order No. 148243 of the Corporation Commission of the State of Oklahoma dated January 3, 1979. That order vacated eighty-eight 640-acre drilling and spacing units, and established 160-acre drilling and spacing units. One hundred eleven applicants joined in the application which produced this order, and in that application they alleged that the prior orders of the Corporation Commission would demonstrate that the Mississippian formation constituted a single common source of supply in the region covered by the application and that the prior orders clearly demonstrated that there had been substantial change of conditions or knowledge of conditions as to that common source of supply, and that in order to prevent waste and protect correlative rights, that change in knowledge of conditions required that the previously existing 640-acre drilling and spacing units be vacated and that drilling and spacing units be established which created 160-acre drilling and spacing units for the Mississippian.
The Mississippian formation underlying the area covered by this application is a gas producer which produces increasing amounts of oil as proportionate to total production along the southeastern portion of the area covered by the application. In that southeasterly portion there have been in the past a number of additional wells drilled on the basis of applications granted on an increased density basis by virtue of the oil production there had. The applicants sought to establish a change in knowledge of conditions underlying the land encompassed in the application and that that change in knowledge of conditions established that 640-acre Mississippian units were incapable of draining the entire formation in the area.
The appellants resisted the application to vacate the 640-aere spacing units and establish 160-acre drilling and spacing units, alleging there had been no substantial change in conditions and thus the application constituted a collateral attack on previous order of the Corporation Commission. Additionally, the appellants alleged that the Mississippian formation throughout this area is, in part, productive of oil as well as gas and the proper method to proceed upon that change in condition was by an order increasing the density of the drilling in the previously existing 640-acre units, noting that the spacing and respacing on proof of change of condition is contrary to the historical policy of the Commission which has been to increase density rather than vacate units and reestablish on the basis of smaller acreage. Appellants Tenneco Oil Company and Union Oil Company of California argue in their appeal that the subject order must be vacated because it was entered by the Corporation Commission outside of the regular pursuit of its authority. The basis of such a proposition is that the June 13, 1978 application of the appellee, which is the original application producing the order upon which this appeal is based, failed to list the appellants Tenneco and Union then owning interests in the area sought to be de-spaced, and that those two appellants had received no notice of the proceedings. Despite this lack of notice, Union and Ten-neco made a special appearance before the Commission prior to the hearing on the order objecting to the jurisdiction of the Commission on that basis and requesting the application be dismissed. Argument was heard prior to the hearing on the merits and the motion to dismiss was denied by the Commission's order of July 7, 1978. This failure to properly serve Union and Tenneco allegedly resulted in a violation of the Commission's own rules and regulations and of the appellants' right to due process, under the line of cases arising out of Mullane v. Central Hanover Bank & Trust Co., 339 U.S. 306, 70 S.Ct. 652, 94 L.Ed. 865 (1950).
Appellants Union Texas Petroleum, a division of Allied Chemical Corporation, Champlin Petroleum Company, Atlantic Richfield Company, Amerada Hess Corporation, Eason Oil Company, Harper Oil Company, Singer-Fleisehaker Oil Operating Company, Inc., Oklahoma Natural Gas Company, Henry H. Gungoll Associates, L. 0. Ward, Carl E. Gungoll, Woods Petroleum Corporation, Odessa Natural Corporation, Mack Oil Company, Okmar Oil Corporation, and Ladd Petroleum Corporation, raise four propositions of error for disposition in their appeal. First, that there is no substantial evidence showing a change in conditions or knowledge of conditions which would authorize the Corporation Commission to vacate its prior 640-acre drilling and spacing unit order. The second point is that the decision of the Commission to destroy the 640-acre drilling and spacing units and thereupon establish 160-acre units is an arbitrary act which violates thé vested rights of the owners of the oil and gas leases held by unit production and the vested rights of the royalty owners. Included in this point is the assertion that there is no evidence to support the Commission's choice from among the two statutory remedies of permitting increased density of drilling or vacation of the established drilling units and creation of smaller drilling and spacing units in their place. The third point made by these appellants is that the order fails to include some 640-acre drilling and spacing units in the same common source of supply, thereby violating the correlative rights of the owners. The fourth point made in this appeal by these appellants is that the appli cants did not comply with the rules of the Commission and that proper response to these failures by the Commission should have been to dismiss the application upon motion made prior to commencement of the hearing.
The orders of the Corporation Commission amended by the order now on appeal start with an order establishing 640-acre drilling and spacing units for the Mississippian gas and gas condensate common source of supply within a 40 square mile area in Major and Garfield Counties dated June 22, 1962. As of that date, only two wells had been completed in the area. That order finds one well adequately drains 640 acres. A year and a half later, the Corporation Commission found in its Order No. 53477 that Sec. 26, T22N, R8W, comprising a 640-acre drilling and spacing unit, was in fact oil productive, and further found that three additional wells were necessary to drain that unit. Those wells were permitted by the order and were found necessary to effect drainage of the section, and to date, only two of the three authorized wells have been drilled, the latter of those two having been drilled in 1978. A later order found the Mississippian in this area to be a combination oil and gas reservoir. The Corporation Commission's Order No. 50337 established 640-acre drilling and spacing units for the Mississippian as gas and gas condensate common source of supply for a nine square mile area in Garfield County, located one mile from the area covered by Order 49133. The order now appealed from establishes as one common source of supply the area as covered in Order No. 49133 and Order No. 50337. The findings of the Corporation Commission incorporated in the now-appealed Order No. 148243 set forth the following:
When previous Order No. 49133 was issued only two wells had been drilled within the area. When Order No. 50337 was issued, only one well had been drilled within the covered area. Six hundred and forty acre drilling and spacing units were first established because the Mississippian was indicated to be gas and gas condensate common sources of supply, and it was then concluded that one well could be expected to effectively drain the recoverable gas and the condensate from those 640-acre units. These two initial orders cover the Mississippian, a common source of supply, although the orders treated the areas as separate from each other. At the time of the issuance of these two orders, it could not have been reasonably foreseen that both oil and gas would be found in the areas. There has been a substantial change in conditions and knowledge of conditions in the Mississippian Lime as to the hydrocarbon saturation, oil, gas and gas condensate. There has also been a substantial change in knowledge of conditions relating to the effective drainage radius of the well sunk to the Mississippian Lime and of the attributes of such formation, particularly porosity, permeability, water saturation, hydrocarbon saturation, pay thickness and lithography.
The Commission also found that there had been a substantial change in the orderly development of the area by the necessary granting of numerous exceptions to well density and drilling and spacing unit size, irrespective of the pattern contemplated by the issuances of Orders No. 49133 and 50337. The Commission then determined that the development of the Mississippian Lime in this area viewed in respect to the production of wells already drilled in conjunction with the drilling and production of wells which will be required in the future demonstrates that a more orderly administration of the area is necessary to assure that those wells reasonably required to prevent waste and protect the correlative rights can or will be drilled. The Commission's conclusions delineate the following:
The evidence of applicants and of the protestants is comparable on the point of the conditions and knowledge of conditions in the Mississippian Lime when the two orders, No. 49133 and 50337, were issued. Similarly, the evidence is comparable when viewed from the standpoint of the now known conditions and knowledge of conditions. However, despite comparable knowledge derived from both historical and current development in operations the two parties differ as to the most reasonable and equitable basis for future orderly development. Protestants have been granted numerous exceptions to Orders 49133 and 50337 as amended. Those exceptions relate to density and variation of drilling unit size upon allegations and proof that there had been a change in conditions or a change in knowledge of conditions in the formation. However, they now contend there has been no change of conditions or knowledge of conditions with respect to the 640-acre units.
The order continues, noting the protestants have urged the appropriate statutory remedy (of the two statutorily provided) is to further develop the area on an increased well density basis upon application of an owner in the unit. The order then notes the interest of the Commission in the prevention of waste and protection of correlative rights requires that the Commission, in this instance, not delegate the responsibility for initiation of requests for increased density drilling to owners whose subjective interest in the premises may be in conflict with the ends of waste prevention or correlative rights protection. Further, the order recites there is substantial evidence to show that there has been and is now a change in conditions and knowledge of conditions, arising from the historical development in production and the area covered by the application. The change recited in the order is that the Mississippian Lime is far less conducive to effective and efficient drainage by one well on a 640-acre unit than it was thought and contemplated to be when Orders 49133 and 50337 were issued in 1962. The 640-acre unit was found not to be causing the Mississippian formation to be effectively and efficiently drained, resulting in unnecessary depletion and inefficient utilization of gas energy pressure in the common source of supply. The order further states that correlative rights cannot be thus protected by the continuation of 640-acre units. The Mississippian within the application area required 160-acre drilling and spacing units be established, and that a well on each 160-acre unit is necessary to effectively and efficiently drain a portion of the reservoir allocated to it. The order then concluded by vacating previous Order No. 49133 and 50337 as amended as to the Mississippian from 6,300 feet to 6,700 feet below the surface and as to 640-acre drilling and spacing units established by those orders. The order then established 160-acre drilling and spacing units. The order then noted: Piecemeal relief has been given in prior times by increasing the density of wells upon the 640-acre units but the Commission concludes here that the establishment of 160-acre units is the proper relief, notwithstanding the fact that other relief is available based on substantial evidence herein.
Tenneco Oil Company and Union Oil Company of California propose the judgment must be vacated here on appeal because, as the transcript of the hearing on the motion to dismiss reveals, neither of these parties received notice of this proceeding. Additionally, they point out the affidavit of mailing notice filed June 29, 1978 indicates no notice was sent at all to Union and was sent to an improper address for Tenneco. These appellants state that notice and service of pleadings upon parties owning the right to participate must be made under Rule 8(d)(3) of the Oklahoma Corporation Commission Rules of Practice. Failure to do so violates the last cited rule and does violence to appellants' right to due process under Mullane v. Central Hanover Bank & Trust, supra, and Bomford v. Socony Mobil Oil Co., 440 P.2d 713 (Okl.1968). Appellants contend that the Corporation Commission is restricted in the valid exercise of its statutory authority to follow its administrative rules, and further that the Commission may not correctly act outside of those rules, citing H. F. Wilcox Oil & Gas Co. v. State, 162 Okl. 89,19 P.2d 347 (1933), and Pacific Molasses Company v. F.T.C., 356 F.2d 386 (5th Cir. 1966). Appellants admittedly cite pertinent authority in Mul-lane, supra, and Bomford, supra. Although familiar, the footings of the Mullane decision are both abstractly fundamental and immediately indispensable to the resolution of the error here offered. This action involves the roots of the holding of Mullane, and the basis upon which it rests. In Mullane, at 339 U.S. 313, 70 S.Ct. 656-657, the Supreme Court noted that although controversy has at times raged about the meaning of the due process clause, it affords at least a limitation requiring that a deprivation of life, liberty or property by adjudication be preceded by notice and the opportunity for a hearing appropriate to the nature of the action. The fundamental requisite of due process of law is the opportunity to be heard. Grannis v. Ordean, 234 U.S. 385, 394, 34 S.Ct. 779, 783, 58 L.Ed. 1363 (1914). The opportunity to be heard is worthless without notification of the occasion requiring it, so that the affected individual may choose for himself whether to appear or default. In Mullane, supra, the court looked to the steps necessary to assure that notice is reasonably calculated under all the circumstances to apprise interested parties of the pendency of the action and afford them an opportunity to present their objections, stating that the notice given must be such as is reasonably calculated to convey the required information in a timely manner so as to allow interested parties to make their appearance. The common thread of the opinion is reasonableness. "The criterion is not the possibility of conceivable injury, but the just and reasonable character of the requirements having reference to the subject with which the statute deals." Mul-la ne at 339 U.S. at 315, 70 S.Ct. at 657. The central point made in Hanover is that notice must be reasonably calculated to import actual knowledge of the suit.
Appellant Union Oil Company of California states it was never served by mail. The affidavits of mailing confirm that allegation. Appellant Tenneco Oil Company states service upon it was improper in that "the notice sent to Tenneco was improperly addressed." There is no allegation in the briefs, or lengthy record of this appeal, which indicates there was any prejudice resulting from the improper address on Tenneco's, notice. The record indicates service by mailing was made. If the incorrect address resulted in failure to give notice that fact should have been raised. The appellant, Tenneco, has not alleged in the proceedings before the Commission that the improper address resulted in failure to impart notice. A mere defect in formal style or nomenclature will not invalidate service of process unless it actually resulted in failure to give notice, as can be discerned from the excerpts from Mullane which demonstrate the inquiry is centered on what steps are necessary to impart actual notice, and not formalistic ritual of service of process.
Here the appellant has offered as a jurisdictional error the mailing of notice to Tenneco at an incorrect address. The record discloses publication notice in Oklahoma County and the two counties in which the land is located, as well as a mailing of notice to Tenneco. Tenneco's mailing address utilized here was the "Cuidad Building." Whether this address is correct or not is not a matter disclosed by the record on this appeal. No attempt was made to demonstrate the erroneous nature of the address during the motion to dismiss when this jurisdictional error was offered. Such evidence woudl appear dehors the record,— therefore the record does not demonstrate that the order here appealed is void for failure to acquire jurisdiction over the person of Tenneco.
The error offered fits within the rationale of Vinson v. Oklahoma City, 179 Okl. 590, 66 P.2d 933 (1937), wherein the failure to mail copies of the petition and notice there offered as reversible error do not appear on the face of the record. The judgment affirmatively negated the alleged failure, reciting that all defendants not answering or appearing have been served with summons personally or by publication. In reference to this aspect of the cause, the second Court syllabus holds that where service is obtained by publication and the judgment recites service is proper, the judgment is not void on its face, consequently an attack on the judgment on the basis of failure to mail a copy of the petition and publication notice can only be made under the provisions of the predecessor of 12 O.S.1971 § 1031, Third. In George v. Kinard, 84 Okl. 95, 202 P. 503 (1921), the Court stated a judgment is not void in the legal sense for want of jurisdiction, unless its invalidity and want of jurisdiction appear on the face of the record; it is voidable merely where the objection is raised because of failure to serve process.
Here the proceeding was questioned at its outset by Tenneco on the ground "that the notice was sent to the wrong address." However, no evidence of the extrinsic fact of the correct address or failure to impart notice arising from the address listed was offered, and thus the order of the Corporation Commission stands unchallenged by proof or offer of the extrinsic fact necessary to demonstrate its invalidity.
As to Union Oil of California, however, the holding of the recent ease of Cravens v. Corporation Commission, 613 P.2d 442, (Okl.1980), is controlling. The record contains no notice of a mailing to this entity and thus the record demonstrates the Commission attempted to proceed against Union's interest in the absence of jurisdiction over the person of that entity. Accordingly, the order's attempt to adjudicate the rights of Union Oil of California is ineffective, and a nullity insofar as it purports to affect its interests.
The appellants Union Texas Petroleum, Champlin Petroleum, Atlantic Richfield, Amerada Hess, Eason Oil, Harper Oil, et al., direct their first proposition of error against the merits of the proceeding, arguing the Commission was without authority to amend its previous order inasmuch as the evidence disclosed no substantial change of conditions. This contention is based upon the prohibition contained in 52 O.S.1971 § 111 against collateral attacks upon a final order of the Corporation Commission. Under that statute, and the cases arising out of it, such as Wood Oil Co. v. Corporation Commission, 205 Okl. 534, 239 P.2d 1021 (1950), and Phillips Petroleum Co. v. Corporation Commission, 461 P.2d 597 (Okl.1969), an application for an order of modification constitutes a collateral attack on the prior order where that modification is not based upon substantial evidence showing a change of conditions or knowledge of conditions arising since the last order. Phillips Petroleum Company, supra, illustrates the fact that the change of conditions or change in knowledge of conditions necessary to support an order of modification speaks to knowledge or conditions which did not obtain at the time the prior order was considered, and not to evidence of conditions or knowledge of conditions which could have been brought forward at the time of the hearing on the prior order but were not considered at that time.
Phillips, supra, cites with approval 11 Okl.Law Rev. p. 125, "Modification Order Pertaining to a Common Source of Supply" at pp. 132 and 133, where the author of the article states: "Logically there are three kinds of change of condition possible. The first type of change of conditions is characterized by an actual change in the physical behaviour of the reservoir occasioned by development and depletion. Second is a change in the information gained from development or depletion experience which demonstrates that the original conclusions reached were incorrect as applied to the studied reservoir, and the third type is, in essence, a change in the technology used to exploit the reservoir, bringing to bear new concepts of waste and correlative rights." As the appellants recognize in their brief in chief, a change of condition alleged to justify a modification of a prior order of the Corporation Commission in this action was that new knowledge has been obtained that in this area a Mississippian gas well would not drain a 640-acre unit. The appellants contend there is no substantial evidence to sustain this finding and that the Commission should have denied the application on that basis.
The appellants also note that under Harper Oil Co. v. Hayes, 431 P.2d 387, (Okl.1967), and Meredith v. Corporation Commission, 368 P.2d 828, (Okl.1961), a spacing order of the Corporation Commission applies to all wells in the common source of supply whether or not an individual well turns out to be an oil well or a gas well. Appellants contend that it has been known for a considerable period of time that the Mississippian formation in the area covered by the orders under consideration now has been capable of oil as well as gas production. This contention is intended to demonstrate there has been no change in knowledge of conditions obtaining since the prior orders, thus defeating the modification here granted. This known fact is not determinative of the issues here presented, which revolve around the inability of the 640-acre unit to be adequately drained by a single well in light of the additional experience with the character of the formation through drilling and production since the last orders were issued. This additional experience was recognized in Phillips Petroleum Co. v. Corporation Commission, supra, as a viable ground upon which to base a motion to modify a prior Corporation Commission order. Thus the inquiry remains: Is the order of modification supported by substantial evidence that a well in this locality of the Mississippian formation would not drain 640 acres? The order initially establishing 640-acre units, 49133, was issued after two wells had been completed in a 40-square mile area. Finding No. 4 from that order reads:
". . One well will adequately drain the gas and gas condensate from said formation underlying 640 acres and that it is unnecessary to drill wells on a closer pattern."
The appellee contends that a substantial change in knowledge of conditions is established both by the primary evidence in this cause and by reference to the prior actions taken in the Corporation Commission by the appellants themselves. An example from testimony in this cause is taken from testimony of Mr. F., qualified as an expert without objection. He states Finding No. 5 in Corporation Commission's previous order 134466, in his opinion, is generally applicable through all the units in this particular case. Finding No. 5 recites:
"That applicants' Wuerflein No. 1 well is now 80 to 90% depleted and applicants' experience in the infield drilling of Mississippian wells on existing spacing units in the area which were previously developed by drilling one well has demonstrated that after the initial wells in each drilling and spacing unit were substantially depleted, the additional well in said drilling and spacing unit encountered initial shut-in bottom hole pressures and production volumes which were comparable with the initial shut-in bottom hole pressure and unit production volumes of the first wells drilled in each unit."
This same witness testified that, in his expert opinion, Paragraphs 7 and 8 of the findings in that same order would apply to each of the drilling and spacing units included within the purview of the action here appealed. Quoting from the record where the provisions of Paragraphs 7 and 8 are recited into the record:
"Applicant has concluded that the infield wells drilled on each unit penetrated a portion of the Mississippian common source of supply that is not being adequately drained by the initial well and that the reservoir conditions in the Mississippian formation common source of supply underlying the lands described in the caption hereof are believed to be comparable in all respects to the conditions encountered in the units on which the Mississippian infield drilling has taken place in the area, so that it is reasonable to conclude that the Wuerflein Unit No. 1 well will not adequately and completely drain the recoverable gas in the Mississippian formation."
"It appears that the Wuerflein unit well will not adequately and completely drain the recoverable gas in the Mississippian formation underlying the unit, and that a second well on said formation will recover additional gas and associated hydrocarbons that will not be produced from existing wells."
The record also indicates a similar finding in Order No. 140576 wherein Finding No. 8 in that order states:
"That the testimony was that it is economically feasible to drill a third well on this spacing unit, and that a third well will recover additional oil and gas that would not otherwise be recovered by existing wells."
Mr. F. testified that in his expert opinion he would reach the same conclusion in consideration of each and all of the drilling and spacing units covered by this application on appeal.
The Commission's report included in Order # 148243 contains the better part of nine legal pages of single-space typing containing the history of modifications of the two base orders, 49133 and 54890. This history demonstrates that order 49133 has at times included twice as many section units as are presently under its purview. Twenty-five of these sections have been authorized additional wells and of these a substantial percentage have been altogether excluded from the original order. Many of these orders reviewed exclude sections from the order and establish smaller units or allow additional wells on the basis that the unit is unable to drain or on the basis that there is a change in production from gas to oil or in the knowledge of the mechanics of the formation.
The Commission's report shows that order 50337 originally formed 640-acre spacing on nine sections on the basis of one previously drilled well. Thereafter that order was extended and some sections then included were deleted later and spaced in 80-acre units for oil.
The Corporation Commission's order here appealed from then states the following after reviewing the history of the two orders:
1. The two parent orders, 49133 and 50337 were issued upon the strength of a total of three well drilling experiences showing a gas and gas condensate field.
2. At the time of issuance it could not reasonably have foreseen the mixed character of the common source or the numerous exceptions both to density of drilling and spacing unit size necessary to prevent waste and protect correlative rights.
3. There has been a substantial change in knowledge of conditions and characteristics of the formation, such as hydrocarbon saturation, oil and gas mix, effective drainage radius, and formation characteristics such as permeability, water saturation and effective pay thickness.
4. There has been a substantial change in the orderly development of the areas considered than was contemplated at the time the original orders were issued.
5. The conditions, and knowledge of them, now prevalent pertaining to the formation and current production as well as future production require a more orderly development than that had under the 640-acre unit and exception therefrom procedure.
The conclusions made by the Corporation Commission included in the order appealed here note that the protestants and applicants differ more in their proposed solutions to future equitable production than in substantive differences as to past and present known conditions of the Mississippian. The conclusions state that in past times, protestants have obtained exceptions by way of variations in drilling unit size and increased density orders on the basis of allegations of change of condition but now protestants are contending that there has been no change of condition justifying a modification order. The Commission concluded that the protestants desire to have further development on an increased density basis upon application by an owner of a unit when he determines that such action should be taken. The Commission concluded leaving that decision to the individual unit owners, under the circumstances, amounts to an indirect delegation of its duty to oversee prevention of waste and protection of correlative rights. Additionally the Commission concluded that the Mississippian is less conducive to drainage by 640-acre units than was contemplated when the parent orders were issued. The pressure depletion now experienced will not drain a 640-acre unit, resulting in inefficient utilization of gas energy in the common source which will cause substantial quantities of oil, gas and condensate not to be recovered by a continued 640-acre unit. The Commission concluded that 160-acre units are reasonably required to drain the reservoir effectively and efficiently, notwithstanding the recognized existence of alternate forms of relief that may be available based upon the substantial evidence submitted.
The Commission heard evidence from both sides of the controversy, and various research methods and validity of statistical analyses, and conclusions drawn therefrom were closely contested and conflicting. The appellants' contention that there is no evidence of substantial change of condition upon which to base an order of modification is refuted by reference to the history of the Commission's orders relative to the area covered by the parent units, and by the allegations of change of condition made in earlier proceedings by some of the contestants herein. Those allegations of change of condition gave the Commission a factual basis upon which to modify orders and grant exceptions. Referring to appellants' Exhibit # 40, we note that roughly thirty-four sections have been allowed additional wells in the area covered by the parent orders and fifty sections have been deleted from those orders for reasons which generally support showing of change in knowledge of the characteristics of the formation.
An objection to an order made by the Corporation Commission does not initiate an independent inquiry in this Court as to the factual support for the order under Article IX, Section 20, Oklahoma Constitution, unless an asserted violation of either state or federal constitutional principles is to be reviewed. Anderson-Prichard Oil Corp. v. Corporation Com'n, 205 Okl. 672, 241 P.2d 363 (1951). However, an allegation of violation of those constitutional principles by issuance of an order not supported by substantial evidence does not invoke an independent review of the evidence. Cameron v. Corporation Commission, 414 P.2d 266 (Okl.1966).
The Commission has a wide discretion in the performance of its statutory duties, and this Court may not substitute its judgment upon disputed factual determinations for that of the Commission but is restricted to a determination of substantial evidentiary support for the order issued under authority of the statutes. In re: Application of Continental Oil Company, 376 P.2d 330 (Okl.1962). Searching a record for substantial evidence supporting the order appealed does not entail a comparison of the parties' evidence to determine that which is most convincing but only that the evidence supportive of the order be considered to determine whether it implies a quality of proof inducing a conviction that the evidence furnished a substantial basis of facts from which the issue could be reasonably resolved. Chenoweth v. Pan American Petroleum Corp., 382 P.2d 743 (Okl.1963). Substantial evidence has been additionally outlined as something more than a scintilla; possessing something of substance and of relevant consequence carrying with it a fitness to induce conviction, but remains such that reasonable men may fairly differ on the point of establishing the case. A determination of substantial evidentiary support does not require weighing the evidence but only a measurement of the supportive points to determine whether the criterion of substantiality is present. Central Okla. Freight Lines v. Corporation Com'n, 484 P.2d 877, 879 (Okl.1971).
A review of supportive facts here present compels the conclusion that the order is supported by substantial evidence. Previous Corporation Commission orders have granted deletions and increased density orders to some of the appellants on the basis of change in knowledge of conditions and these changes have been made on approximately half the acreage comprising the area covered by the two parent orders and this order.
Appellants object to the order here issued on the additional basis that there is no substantial evidence to support the Commission's action of ordering deletion of the large units as opposed to ordering increased density drilling on established units. Such an allegation of error is insufficient to disturb the Commission's order on the basis of statutory authority and the evidence disclosed in the record. Factually, the record contains indicia that for extended periods of time, Commission orders allowing additional wells on the basis of inability to recover known reserves have not been carried out. Known inability to recover product and protect correlative rights after a demonstrated change in knowledge of conditions has not been remedied in the area by past orders to increase density, and under 52 O.S.Supp. 1978 § 87.1 d, the alternative remedy granted here is decreasing the size of the well units. That portion of the last mentioned statute reads:
The Commission shall have jurisdiction upon the filing of a proper application therefor, and upon notice given as provided in subsection (a) above, to decrease the size of the well spacing units or to permit additional wells to be drilled within the established units, upon proper proof at such hearing that such modification or extension of the order establishing drilling or spacing units will prevent or assist in preventing the various types of wastes prohibited by statute, or any of said wastes, or will protect or assist in protecting the correlative rights of persons interested in said common source . .
Appellants cite Grison Oil Corp. v. Corporation Commission, 186 Okl. 548, 99 P.2d 134 (1940), as supportive of the proposition that private rights should be interfered with as little as possible where such disruption is necessitated by an exercise of the police power in the prevention of waste. It would be unusual to encounter a party disagreeable to such a statement. The Commission's conclusion that past density applications by owners in the unit have not uniformly developed the common source, and have not been carried out with dispatch, negates the allegation that both statutory remedies are equally suited to the facts, and substantial evidence supports the choice of alternatives made by the Commission.
Appellants additionally contend the Commission's order respacing these sections as 160-acre units must be reversed by virtue of the Commission's failure to respace the entire common source. As the exhibits demonstrate, the order here appealed covers the center of the two parent orders, while the parent orders extend southwest and north of the order appealed. Prior orders have stated that both parent orders cover the same common source.
As early as the motion to dismiss the Commission was requested to proceed on a piecemeal basis, one section at a time. At the hearing on the merits, the appellants also objected to consideration of such a large area in one proceeding. This was done both by reference to the burden laid on the parties by entertainment of a modification application on a 92-section area, and by objection to testimony on the basis that expert evidence should be limited in impact to the unit from which the engineering data was gathered. Appellants actively requested the Commission to consider the modification request on a piecemeal basis, but now seek reversal of the order on the ground that the one proceeding did not encompass the entire common source. Given this position taken in the hearings below, it is inappropriate to now allow reversal of the Commission's order on grounds which directly conflict with the parties' position below. Parties to an action on appeal are not permitted to secure a reversal of a judgment upon error which they have invited and acquiesced in, or to assume an inconsistent position from that taken in the trial court. Cimarron Valley Pipe Line Co. v. Holmes, 182 Okl. 450, 78 P.2d 403 (1938); Cities Service Oil Co. v. Merritt, 332 P.2d 677 (Okl.1958). As early as Morrison v. Krouch, 141 Okl. 288, 285 P. 10 (1930), the related principle was considered as firmly established. In Morrison, the first Court Syllabus reads: "It is a well-settled rule that a party to a suit, having- proceeded in the trial court upon a theory and lost, will not be permitted, upon appeal to this court, to change his theory and seek to reverse a case upon a different theory." The rule emanates from the very heart of the purpose served by an appeal. In Breene v. Crawford, 175 Okl. 186, 53 P.2d 244 (1935), the Court held that a defendant will not be allowed to shift his ground of defense on appeal in order to present another defense not presented nor relied upon in the trial court. To allow such a traverse in theory at the appellate level thwarts the very basis of the appellate process. The purpose of an appeal is not to present an opportunity for a trial de novo, but to review the correctness of the rulings made upon the arguments of the trial court. The parties to an action, having presented their case for defense to the trial court upon a certain theory, are bound thereby and will not be permitted to change the theory of the case upon appeal. See also: Knox v. Eason Oil Co., 190 Okl. 627,126 P.2d 247 (1942); Louis Berkman Co. v. Unger Metals Corp., 190 Okl. 101, 121 P.2d 606 (1942); Foster v. Higginbotham, 186 Okl. 276, 97 P.2d 63 (1939); Secrest v. Williams, 185 Okl. 449, 94 P.2d 252 (1939); Cadwell v. Ryan, 185 Okl. 158, 90 P.2d 887 (1939); U. S. Fidelity & Guaranty Co. v. State ex rel. Shull, 169 Okla. 59, 36 P.2d 47 (1934); Ward v. Continental Ins. Corp., 169 Okla. 59, 36 P.2d 47 (1933); Cope v. Johnson, 123 Okl. 43, 251 P. 985 (1926).
The order of the Corporation Commission is determined to be supported by substantial competent evidence and is therefore affirmed; provided that no part thereof is valid insofar as it affects the rights and interests of Union Oil of California, and is reversed insofar as it attempts to adjudicate the rights of Union Oil of California.
REVERSED IN PART; AFFIRMED IN PART.
WILLIAMS, LAVENDER, DOOLIN and OPALA, JJ., concur.
IRWIN, C. J., BARNES, V. C. J., and HODGES and SIMMS, JJ., dissent.
. "(d) Service in Special Cases:
(3) Applications for Amendment of Conservation Orders. At any time subsequent to the commencement and prior to the plugging and abandonment of a well upon a drilling and spacing unit, in lieu of service under subsection (b) of this rule, notice of hearing of an application to vacate, alter, modify or amend an order creating a drilling and spacing unit; to delete land from, increase or decrease the size of the drilling and spacing unit or for increased or decreased density of wells within the unit, shall be served by the applicant by regular mail upon each person having the right to participate in production from the unit. An affidavit shall be filed prior to hearing the application, stating the names and addresses of the persons so served, and that notice has been mailed pursuant to this rule." (Emphasis added)