Title: McCue v. Deerfield Gas Production Co.
Citation: 173 Kan. 302, 245 P.2d 1191
Docket Number: 38,683, 38,684, 38,685
State: Kansas
Issuer: Kansas Supreme Court
Date: July 3, 1952

173 Kan. 302 (1952)
245 P.2d 1191
B.C. McCUE and DELLA A. McCUE, Appellees,
v.
DEERFIELD GAS PRODUCTION COMPANY, a corporation, KEARNEY GAS PRODUCTION COMPANY, a corporation, and KANSAS-NEBRASKA NATURAL GAS COMPANY, INC., a corporation, Appellants. L.F. RODERICK and FLORENCE R. RODERICK, Appellees,
v.
DEERFIELD GAS PRODUCTION COMPANY, a corporation, KEARNEY GAS PRODUCTION COMPANY, a corporation, and KANSAS-NEBRASKA NATURAL GAS COMPANY, INC., a corporation, Appellants. RALPH E. THORPE and ZERA THORPE, Appellees,
v.
DEERFIELD GAS PRODUCTION COMPANY, a corporation, KEARNEY GAS PRODUCTION COMPANY, a corporation, and KANSAS-NEBRASKA NATURAL GAS COMPANY, INC., a corporation, Appellants.
Nos. 38,683, 38,684, 38,685

Supreme Court of Kansas.
Opinion filed July 3, 1952.
W.R. Martin, of Wichita, argued the cause, and James D. Conway, of Hastings, Nebraska, George B. Collins, C.L. Williams, Oliver H. Hughes, K.W. Pringle, Jr., all of Wichita, and Logan N. Green, Roland H. Tate, and Daniel R. Hopkins, all of Garden City, were with him on the briefs for the appellant.
*303 Dale M. Stucky, of Wichita, argued the cause, and Howard T. Fleeson, Homer V. Gooing, Wayne Coulson, Paul R. Kitch, Donald R. Newkirk, George W. Holland, all of Wichita, and A.E. Kramer and Bernard E. Nordling, both of Hugoton, were with him on the briefs for the appellees.
The opinion of the court was delivered by
HARVEY, C.J.:
These three cases present the same legal question. They were consolidated for argument in the court below and are consolidated here for the purpose of abstract and briefs. However, the abstract is set out only in case No. 38,684. The appeal is by the last defendant named only from an order overruling its special demurrer to paragraph 6 of the petition and from an order overruling its general demurrer to the petition. While the petition might be abbreviated in part we think best to set it out in full. It reads:
To this petition Kansas-Nebraska filed the following:
This motion was overruled; whereupon Kansas-Nebraska filed its demurrers, which read:
These demurrers were considered by the court and overruled. The appeal is from those rulings.
In this court counsel for appellant express the view that the petition should be strictly construed against the pleaders. Counsel for the appellees argue to the contrary. We think the point is not very material and we shall not labor it. It is true appellant's motion as it pertains to paragraph 6 of the petition is to strike therefrom the conclusion of plaintiffs as to the contractual relations between the parties and substitute in lieu thereof the actual contract between defendants. Counsel for appellees say this assumes there is but one contract and that it is in writing, which assumption is not justified from the language of the petition. This argument indicates that plaintiffs may be relying upon one or several contracts, one or more of which may be in writing and the other, or others, may be oral. This makes the pleading more confusing than ever and necessarily causes defendant and the court to wonder what contract, or contracts, plaintiffs are relying upon. Whatever they are, plaintiffs' conclusion is that they are third party beneficiaries. Obviously, plaintiffs' conclusion that they are third party beneficiaries cannot be determined by appellant from the facts alleged, and what is more important, the court cannot determine those facts. It seems clear plaintiffs have not stated their cause of action in plain and concise language as required by the code. (G.S. 1949, 60-704. Second.) The special demurrer to paragraph 6 or the petition should have been sustained.
The general demurrer to the petition, upon the ground that it does not state facts sufficient to constitute a cause of action, presents other and very important questions. From the petition it appears plaintiffs complain of two things: First, that defendants purchase the gas measured on a wellhead pressure of 16.4 pounds and that it is marketed by appellant on a pressure basis of 14.6 to 14.9 pounds per square inch or less. From other cases we have had before us it appears that the State Corporation Commission, *308 by an appropriate order, has fixed the value of gas produced from wells to be measured upon the basis of 16.4 pounds per square inch, and for this reason we should take judicial notice of that fact. Passing that, however, if plaintiffs sell the gas at the wellhead, measured upon the basis either agreed upon between the parties or fixed by the State Corporation Commission, it is difficult to see that plaintiffs are concerned with the basis by which appellant measures the gas when it sells it.
The other point which forms the basis for plaintiffs' claim appears to arise in this way: Prior to the order of the State Corporation Commission fixing a minimum price at the wellhead of 8 cents per thousand cubic feet for gas produced from the wells, plaintiffs, under the lease, received only 6 cents per thousand cubic feet. After the order of the State Corporation Commission was made plaintiffs have been receiving 8 cents per thousand cubic feet. Plaintiffs contend this is not enough because gas as it comes from the well contains gasoline, lampblack, and other substances which may be extracted and sold separately; that the gas is really worth 14 1/2 cents per thousand cubic feet at the wellhead, and that plaintiffs should be paid that amount. Plaintiffs may be entirely correct in their estimate of the real value of the gas at the wellhead, but this is a suit by the lessors against the lessee, or one who stands in the stead of the lessee, for a proper method of having that additional price determined. We do recall that in the testimony taken in the case of Kansas-Nebraska Natural Gas Co. v. State Corporation Commission, 169 Kan. 722, 222 P.2d 704; 170 Kan. 341, 225 P.2d 1054, some of the witnesses testified the gas was worth as much as 20 cents per thousand cubic feet at the wellhead. The well in question here apparently is in a part of the large Hugoton gas field in southwest Kansas in which there are scores, perhaps thousands, of separate leases. The thought intrudes: Can it be possible that the lessor in each of those leases can maintain a separate action against the lessee for what the lessor may deem to be the proper price for the gas at the wellhead? The State Corporation Commission has fixed a minimum price of 8 cents per thousand cubic feet. These plaintiffs say that it is worth 14 1/2 cents. Other lessors might fix the value above 8 cents, at something different than plaintiffs here place it. Perhaps this entire matter of what is a reasonable price above the minimum of 8 cents at the wellhead, where the gas does contain the extra elements *309 mentioned here, is an appropriate one to be presented to the State Corporation Commission. However, we are not required to determine that matter in this case. Indeed, the record before us would not justify us in doing so. We are only required to determine whether this petition states a cause of action against the appellant, the Kansas-Nebraska Natural Gas Company, Inc. The present owners of the lease are Deerfield and Kearney. The pertinent allegation against Kansas-Nebraska is that under some indefinite contractual arrangements, of which plaintiffs are third party beneficiaries, Kansas-Nebraska is liable. We are confident the petition states no cause of action against Kansas-Nebraska. The orders of the trial court overruling appellant's special demurrer to paragraph 6 of the petition and its general demurrer to the petition should be reversed with directions that those demurrers be sustained.
It is so ordered.