Opinion ID: 2834620
Heading Depth: 2
Heading Rank: 1

Heading: Statute of Limitations: Statutory and Common Law Waste, Negligence Per Se, Negligent Misrepresentation, and Tortious Interference

Text: The parties agree that a two-year statute of limitations applies to their claims for statutory and common law waste, negligence per se, negligent misrepresentation, and tortious interference. [8] Tex. Civ. Prac. & Rem. Code § 16.003(a). However, Emerald and the royalty owners argue that Exxon’s conduct tolled the statute of limitations or delayed accrual of their claims. At trial, the jury found that the royalty owners discovered, or should have discovered in the exercise of reasonable diligence, the waste committed by Exxon on January 24, 1995, the date that Emerald’s representatives met with the royalty owners and informed them, in the words of the court of appeals, “about the full extent of damage to the wells and the numerous discrepancies” in Exxon’s plugging reports. 180 S.W.3d at 316. The court of appeals determined that the statute of limitations tolled until that date and affirmed the judgment on that issue. Id. at 316–17. Exxon argues that the court of appeals improperly tolled the two-year statute of limitations until Emerald and the royalty owners discovered the full extent of the damage, instead of the date Exxon completed plugging the wells. [9] Emerald and the royalty owners do not dispute that, unless accrual of the cause of action is deferred or the statute of limitations tolled, the two-year statute of limitations bars all of their claims except fraud, which has a four-year statute of limitations. See Tex. Civ. Prac. & Rem. Code § 16.004. Although Emerald and the royalty owners argue that the statute of limitations on their claims has tolled under the doctrine of fraudulent concealment, or that the accrual of their claims have been deferred because of the discovery rule, we do not reach these issues because Emerald and the royalty owners had actual knowledge of violations of the lease agreement and their injuries by June 8, 1994 at the latest. Specifically, the royalty owners advised Exxon in writing in September 1990 that plugging the wells would commit waste in violation of the law. In June 1994, Emerald advised the royalty owners that it discovered that Exxon placed cut casing and junk in one or more wells. Therefore, by September 1990, the royalty owners had actual knowledge of the facts underlying their breach of lease and waste claims, and by June 1994, both Emerald and the royalty owners had actual knowledge of the facts underlying their negligence and tortious interference claims. The royalty owners argue that they did not appreciate the significance of the statements in the letter they wrote to Exxon in 1990 and the letter Emerald sent to them in 1994. However, the 1990 letter threatened Exxon with a lawsuit for waste and violation of the law if it plugged the wells, and in the 1994 letter, Emerald told the royalty owners that Exxon cut casing and dumped junk in the wells that were plugged. Both the court of appeals and the jury concluded that Emerald and the royalty owners did not have actual knowledge of their claims until January 1995. The legal significance of the undisputed facts cannot be ignored. See City of Keller v. Wilson , 168 S.W.3d 802, 814–17 (Tex. 2005) (explaining that courts conducting a no-evidence review cannot ignore evidence that has one logical conclusion). The letters unequivocally and conclusively establish that the royalty owners and Emerald knew or suspected there was damage to their interests in the O’Connor Lease in 1990 and 1994. Causes of action accrue when claimants are on notice of their injury and have the opportunity to seek a judicial remedy. Provident Life & Accident Ins. Co. v. Knott , 128 S.W.3d 211, 221 (Tex. 2003). The claims have a two-year statute of limitations. Irrespective of whether fraudulent concealment or the discovery rule tolls any portion of an applicable limitations period, actual knowledge of the injury triggers the accrual of the cause of action. The limitations period on the royalty owners’ breach of lease and waste claims began to run September 1990 and ended September 1992, and the limitations period on Emerald’s and the royalty owners’ negligence and tortious interference claims began to run June 1994 and ended June 1996, when the royalty owners had actual knowledge of their claims. Thus, Emerald’s claims brought in July 1996 and the royalty owners’ claims brought in September 1996 are time-barred. See Tex. Civ. Prac. & Rem. Code § 16.003(a).