Opinion ID: 1796655
Heading Depth: 1
Heading Rank: 5

Heading: trial of common lessee cases

Text: The courts that have considered the common lessee problem have considered facts different from this case. In those cases the common lessee was causing the drainage by production on adjacent or adjoining land. The drainage was caused by production independent of water-drive and was local drainage. However, those decisions are analogous because of the common lessee. Professors Williams and Meyers have put these cases in three categories. See 5 H. Williams & C. Meyers, Oil and Gas Law § 824 (1980); Meyers & Williams, Implied Covenants in Oil and Gas Leases: Drainage Caused by the Lessee, 40 Texas L. Rev. 923 (1962). First, there are cases which state the lessee was causing the drainage but place no significance on that fact. See, e. g., Billeaud Planters v. Union Oil Co. of Cal., 245 F.2d 14, 18-19 (5th Cir. 1957); Gerson v. Anderson-Prichard Prod. Corp., 149 F.2d 444, 445-46 (10th Cir. 1945); Chapman v. Sohio Petroleum Co., 297 S.W.2d 885, 886-87 (Tex.Civ.App.El Paso 1956, writ ref'd n. r. e.). Second, other cases state that the lessee caused the drainage but hold this fact does not alter the ordinary rules of liability for failure to protect from drainage. Hutchins v. Humble Oil & Ref. Co., 161 S.W.2d 571, 573 (Tex.Civ.App. Galveston 1942, writ ref'd w. o. m.); accord, Tide Water Associated Oil Co. v. Stott, 159 F.2d 174, 177 (5th Cir. 1946). Third, there are cases holding the liability of the lessee is increased when the lessee is causing the drainage. See, e. g., Cook v. El Paso Natural Gas Co., 560 F.2d 978, 982-84 (10th Cir. 1977) (reasonable prudent operator rule inapplicable in common lessee case, proof of drainage all that is required); Bush Oil Co. v. Beverly-Lincoln Land Co., 69 Cal.App.2d 246, 158 P.2d 754, 758 (1945) (immaterial whether protection well would be profitable if drainage caused by lessee's affirmative act); Phillips Petroleum Co. v. Millette, 221 Miss. 1, 72 So.2d 176, 183 (Miss. 1954) (lessee strictly liable for substantial drainage caused by own affirmative acts). This Court in Shell Oil Co. v. Stansbury, 410 S.W.2d 187, 188 (Tex.1966), expressly overruled the Hutchins case, supra, and held that an express offset provision does not limit the lessee's obligation to protect from drainage when the lessee is the one causing the drainage. In drainage cases, Texas courts place upon the lessor the burden to prove that substantial drainage has occurred and that an offset well would produce oil or gas in paying quantities. Clifton v. Koontz, supra . The judgment of the Court of Civil Appeals is modified to prohibit the recovery of exemplary damages and affirmed as modified.