Court Opinion

ID: 9776910
Source: CourtListenerOpinion
Date Created: 2023-08-29 19:48:21.85111+00
Date Added: 2024-06-11T07:32:44.850397
License: Public Domain

POPE, Justice
(dissenting).
The fault that I find with our holding in this case is that we are trying to fit the meaning of terms used by private parties to a lease into a supposed technical terminology used by the Railroad Commission in making its rules and orders. This is the sequence of events. First the parties made the oil and gas lease and in it they provided:
“Units pooled for oil hereunder shall not substantially exceed 40 acres each in area, and units pooled for gas hereunder shall not substantially exceed in area 640 acres plus a tolerance of 10% thereof, provided that should governmental authority having jurisdiction prescribe or permit the creation of units larger than those specified, units thereafter created may conform sub- . stantially in size with those prescribed by governmental regulations.”
Several years later the Commission order was passed which stated:
“ * * * No proration unit shall consist of more than eighty (80) acres except as hereinafter provided, * * * “Provided, however, that operators may elect to assign tolerance of not more than eighty (80) acres of additional unassigned lease acreage to a well on an eighty (80) acre unit and shall in such event receive allowable credit for not more than one hundred sixty (160) acres.”
The thrust of our opinion is that the Commission “prescribes” certain things, and it also “permits” certain things. The majority then tries to determine which the Commission did in this instance and holds that the Commission “prescribed” eighty acres but did not “prescribe” 160 acres. The fact is that the Commission passed its rules without regard to whether it was “prescribing” or “permitting,” as those terms are used by the private contracting parties. The term “permitted” actually does two things: It permits but it also prohibits all that is beyond that which is permitted. Every permit carries an inherent prescription, proscription, and prohibition of things beyond the permit. What the Commission did in passing its Rule 2 was to authorize certain units. Those units could be formed *334without any further recourse to the Commission. To the extent that Rule 2 was complied with, a unit was authorized. To the extent that it was beyond what Rule 2 authorized, it was prohibited. To the extent that it was prohibited, it was “prescribed,” if we want to squeeze the Commission order into the contractual mold. In my opinion the word “prescribed” is more applicable to the 160-acre unit than the 80-acre unit because the only prohibition or direction is against creating a unit of more than 160 acres.
I respectfully dissent.