Case Name: Winston J. FREY, Plaintiff-Appellee, v. Maurice MILLER et al., Defendants-Appellants
Court: Louisiana Court of Appeal
Jurisdiction: Louisiana
Decision Date: 1964-03-24
Citations: 165 So. 2d 43
Docket Number: No. 1092
Parties: Winston J. FREY, Plaintiff-Appellee, v. Maurice MILLER et al., Defendants-Appellants.
Judges: Before FRUGÉ, SAVOY and CULPEP-PER, JJ.
Reporter: Southern Reporter, Second Series
Volume: 165
Pages: 43–51

Head Matter:
Winston J. FREY, Plaintiff-Appellee, v. Maurice MILLER et al., Defendants-Appellants.
No. 1092.
Court of Appeal of Louisiana. Third Circuit.
March 24, 1964.
On Rehearing May 28, 1964.
Rehearing Denied June 17, 1964.
Wesley H. Clanton, Guillory, Guillory & Guillory, by Isom J. Guillory, Eunice, Aaron & Aaron, by J. Donald Aaron, Jr., Crowley, for defendants-appellants.
Pugh, Buatt & Pugh, by Lawrence G. Pugh, Jr., Crowley, for plaintiff-appellee.
Before FRUGÉ, SAVOY and CULPEP-PER, JJ.

Opinion:
FRUGÉ, Judge.
This is a suit to cancel royalty rights on part of a certain tract of land in Acadia Parish.
- The facts have been stipulated. On July 6, 1951, plaintiff purchased a tract of land consisting of approximately 180 acres. The vendors reserved an undivided Yw royalty interest in the oil, gas and other minerals produced from the property. Drilling was commenced on the land during the ten years following the sale but no minerals were produced. However, production was obtained from an adjoining tract known as the Zaunbrecher Unit. On June 25, 1959, the Commissioner of Conservation included 26.65 acres of plaintiff's tract in the Zaun-brecher Unit. The well located in the unit was still producing when this suit was filed. After ten years had passed from the date of the original sale and royalty reservation, plaintiff brought this suit to cancel the royalty interest insofar as it related to that part of the tract located outside the Conservation Commissioner's unit. Defendants raised an exception of no cause of action, which was referred to the merits. The district court rendered judgment for plaintiff. From this judgment the defendant royalty owners appeal.
Plaintiff takes the position that the order of the Conservation Commissioner including part of the tract in the unit had the effect of dividing the royalty interest. He argues that since there has been no production on that part of the tract outside the unit the royalty interest as to that part has prescribed. Defendants maintain that production within the unit interrupted prescription on the entire 180 acre tract, even though the producing well was not located on any part of the tract.
Our research shows that this issue has never been decided by our courts. However, we think that the statutory law and prior jurisprudence indicate that prescription was interrupted on the entire 180 acre tract. Plaintiff's exception of no cause of action should have been maintained.
It is well settled that a mineral royalty is subject to the prescription of ten years liberandi causa if production of minerals from the land does not occur within that time. In certain situations, when a tract of land subject to a royalty interest or a part of it is included within a unit, a producing well within the unit but not on the tract will constitute production on the tract itself and will interrupt prescription on the entire royalty interest, even as to that part not included within the unit. Crown Central Petroleum Corp. v. Barousse, 238 La. 1013, 117 So.2d 575; Montie v. Sabine Royalty Co., La.App. (3rd Cir.), 161 So.2d 118.
Defendants cite Crown Central Petroleum Corp. v. Barousse, supra, in support of their position that prescription was interrupted on the entire 180 acre tract. In that case part of a tract subject to a royalty interest was included in a voluntary unit. A producing well was drilled within the unit but not on the tract subject to the royalty interest. The Supreme Court held that prescription on the royalty interest was interrupted on the entire tract subject to the interest. Although Crown Central Petroleum Corp. v. Barousse concerned a voluntary unit, the result should be the same when a Conservation Commissioner's unit is involved. A voluntary unit is created by conventional agreement; a conservation unit is one imposed on the land because of the state's strong public policy to prevent waste. We can see no reason why both should not have the same effect on royalty interests. This position is further strengthened by the fact that the Legislature, in adopting the Conservation Act, provided that "[t]he portion of the production allocated to the owner of each tract included in a drilling unit formed by a pooling order shall, when produced be considered as if it had been produced from his tract by a well drilled thereon." LSA-R.S. 30:10(A) (1) (b). This shows a legislative intent to provide that production from a well in a Conservation Commissioner's unit is to be treated as production on every part of the land within the unit. Therefore, since production from the unit is attributable to that part of plaintiff's tract located within the unit, such production has the effect of interrupting prescription on the royalty interest on plaintiff's entire 180 acre tract.
Plaintiff contends that Crown Central Petroleum Corp. v. Barousse, supra, does not support defendant's position. He cites language in that case stating that decisions of the Supreme Court providing that a Conservation Commissioner's forced pooling order had the effect of dividing a mineral servitude "might be applicable to royalty rights as it could be plausibly argued that, when the Department of Conservation has issued orders unitizing only a part of land affected by mineral royalty, a division of the royalty is effected and that production from the unit, from a well not situated on any part of the land subjected to the royalty, does not interrupt prescription as to the royalty on the land outside the unit. However, we are not dealing in this case with unitization orders of the Conservation Department." Crown Central Petroleum Corp. v. Barousse, supra, at 117 So.2d 580. (Emphasis added). It is clear from that language that the issue presented in this case was not before the Court at that time. The language was dictum and the Court did not indicate how it would decide the issue. The Court merely stated that these cases "might" be applicable and that "it could be plausibly argued" that the royalty interest was divided. The Court did not so hold nor did it indicate that it would so hold.
Plaintiff takes the position that this case should be governed by the holdings of the Supreme Court in Childs v. Washington, 229 La. 869, 87 So.2d 111, and Jumonville Pipe & Machinery Co. v. Federal Land Bank, 230 La. 41, 87 So.2d 721. In those cases "the holding of the Court was that all lawful forced pooling orders which included part of land burdened by a mineral servitude effected a division of the servitude and that drilling and production upon lands included in the unit, but not upon property subjected to the servitude, did not interrupt the running of prescription as to the part of the servitude outside, of the unit." Crown Central Petroleum Corp. v. Barousse, supra, 117 So.2d at page 580. But the Childs and Jumonville cases dealt with mineral servitudes; the case before us deals with a royalty interest. We feel that this is a distinguishing feature. "(T)he right to search and explore, which belongs to the owner of the servitude, is not given to the royalty owner; that the latter must await such time as the land has been developed, and his right is restricted to a sharing in production if and when it is obtained by the landowner or a lessee, Vincent v. Bullock [192 La. 1, 187 So. 35], supra; Union Sulphur Co. v. Andrau, 217 La. 662, 47 So.2d 38, and authorities cited therein." Le Blanc v. Haynesville Mercantile Co., Inc., 230 La. 299, 88 So.2d 377, 380; Crown Central Petroleum Corp. v. Barousse, supra. A servitude owner is capable of taking positive action with respect to his rights. He may exercise his rights by drilling a well and using his servitude. A royalty owner can do nothing to preserve the right. If there is production, prescription is interrupted; if nothing is done, his royalty rights are gone at the end of ten years. Since the Childs and Jumonville cases concerned servitudes, not royalty interests, we do not think that those decisions can be controlling in the case before us. Since royalties and servitudes are different kinds of interests, the rules applicable to one are not necessarily applicable to the other.
For the foregoing reasons the judgment of the district court is reversed. It is hereby ordered, adjudged and decreed that there be judgment in favor of the defendants sustaining their exception of no cause of ac tion and against the plaintiff dismissing plaintiff's suit. All costs are assessed to plaintiff.
Reversed and rendered.