Court Opinion

ID: 9680337
Source: CourtListenerOpinion
Date Created: 2023-08-24 07:29:49.903454+00
Date Added: 2024-06-11T18:17:27.763405
License: Public Domain

MR. JUSTICE SMITH
joined by JUSTICE HAMILTON dissenting.
I respectfully dissent. This case involves the question of the right of a lessee under an oil and gas lease to dispose of the salt water in an earthen pit located on the lease, free from liability to the lessors for resultant damages to the same lease premises. This is not a suit such as Pickens v. Harrison, 151 Texas 562, 252 S.W. 2d 575. That case involved a claim for damages against a defendant who had been operating a well or wells on neighboring property.
There is no evidence of negligence in this case. It is true, the respondents alleged negligence in their pleadings. There was no pleading that petitioners had used more land than reasonably necessary or that they had been guilty of any intentional, wilful, or wanton act. There were no issues submitted inquiring whether petitioners had used more of the property than reasonably necessary, neither were there any issues submitted inquiring whether petitioners had acted in an intentional or wilful manner or in a wanton manner.
This record will not support the judgment based on affirmative answers to the two negligence issues submitted. The judgment against petitioners cannot stand on either the finding that the petitioners were negligent in permitting salt water to escape from the salt water pit, and that such negligence was a proximate cause of the pollution of the irrigation well, or the finding that petitioners negligently failed to protect the fresh water strata from pollution, and that such negligence was a proximate cause.
The Court of Civil Appeals held that the only duty owed by petitioners was not to intentionally, wilfully or wantonly injure respondents’ water strata. However, the court then said that petitioners had reason to anticipate injury, and since they *97had failed to perform the duty arising on account of that anticipation such conduct was wanton. It was obviously upon that conviction of wantonness that the Court of Civil Appeals affirmed the judgment of the trial court.
This court admits that liability cannot be predicated on that “character of conduct,” yet affirms the judgment on the theory that the plaintiff pleaded and proved negligence and proximate cause, and obtained favorable jury findings thereon.
Under the authorities, as I interpret them, the oil and gas lessee has the right to take without paying damages a part of the surface of the land for drilling operations, and the lessee is not liable to the lessor or his tenant for a negligent use of that land so long as he takes no more than is reasonably necessary. The lessee’s only liability, admitting that the part of the premises taken is reasonably necessary, is for wilful, intentional or wanton destruction of the lessor’s property. There appear to be no cases involving the rights of the parties relatives to the use of the subsurface. However, I can draw no distinction and see no plausible reason why the same rules should not govern in both instances, that is, the surface and the subsurface.
In the present case, the oil and gas lease gave the lessee the right to enter upon and use the premises to remove, treat, and market the oil and gas in the manner consistent with the usual and proper oil field practices. That was the manner of use in this case. The lessee had the dominant estate and the right to use the entire premises from the surface to and through the fresh water sands and salt water sands down to and including the deepest formation from which production could be obtained. In other words, an oil and gas operator has the same rights to the use of the subsurface as reasonably necessary for his operations as he has to the use of the surface for such operations.
If this proposition is sound, and I think it is, then it is clear, just as in many surface cases, that the landowner or tenant of the landowner has no right to recover for appropriation of or damage to the subsurface strata resulting from oil and gas operations unless he alleges and proves by competent testimony and the jury finds, that the oil and gas lessee has taken more land than is reasonably necessary for his operations. The lessors-respondents have wholly failed to try this case upon this, the only theory of recovery. There has been no determination, either by express or implied finding, that the lessee has taken more *98land than was reasonably necessary. Of course, the lessee does not have the right to destroy underground fresh water merely because he is a lessee or at his pleasure. The fact remains, however, that in a suit such as this, the burden rests with the lessor to establish that the appropriation of the underground fresh water is not reasonably necessary to the lease operations. The cases recognize the right of the lessee to exclusive possession of so much of the land as is reasonably necessary for his operations. See Warren Petroleum Corp. v. Martin 153 Texas 465, 271 S.W. 2d 410. Since there is no evidence showing the boundaries of the area, either on, above, or below the surface which the lessee is entitled to use to the exclusion of the lessor, how can it be said with any degree of certainty that the salt water has escaped beyond the area which the lessee had the right to use? The rules of common law negligence cannot be applied until this controlling issue has been determined. Therefore, respondents stand before this court without the necessary findings upon which to rest a judgment in their favor.
This rule does not apply and did not control in Pickens v. Harrison, supra. In that suit there was no privity of estate between the adjoining land and the lessee or operator of an oil and gas lease on neighboring property. That was strictly a common law negligence case.
In the case of Gulf Oil Corporation v. Alexander, Tex. Civ. App., 291 S.W. 2d 792, wr. ref. n.r.e., at 156 Texas 455, 295 S. W. 2d 901 (1956), another adjoining property damage case, the Court of Civil Appeals opinion placed liability on violation of Railroad Commission Rule 20. The Court of Civil Appeals holding was just another way of imposing a strict liability without fault under the doctrine of Rylands v. Fletcher, which has been rejected in a number of cases, including Turner v. Big Lake Oil Company, 128 Texas 156, 96 S.W. 2d 221 (1936).
What I have said thus far applies with equal force to the issue which inquired whether the failure to protect the fresh water strata from pollution was negligence.
This court refers to the case of Warren Petroleum Corp. v. Monzingo, 157 Texas 479, 304 S.W. 2d 362, 65 A.L.R. 2d 1352, (1957). That case was a suit by a surface owner against an oil and gas lessee for location damages resulting from abandonment of a test well as a dry hole, leaving unfilled slush pits, ruts, and a roadwajr on the surface of the land. The court held that the *99lessee had the right to use so much of the premises and in such manner as reasonably necessary to effectuate the lease and hence the lessee was under no implied obligation to restore the surface of the land to its original condition after abandonment of operations. The court here admits that this case correctly states the law, yet the majority here is willing to assess damages against petitioner without requiring a finding that more land was used than was reasonably necessary. The court has by implication held that the jury findings of negligence are the equivalent of findings that the petitioners used more land than was reasonably necessary. I cannot agree that the situation in our case is the same as where a lessee has negligently permitted salt water to escape from his pit and flow over a lessor’s field, etc. The two situations would be identical only if the lessor proved in each instance that the lessee used more land than was reasonably necessary. It was necessary for repondents to plead and prove that the petitioners used more land than was necessary. This is always necessary in a case such as this where there is no evidence that the petitioners intentionally permitted the salt water to percolate downward into the fresh water strata. See Warren Petroleum Corp. v. Martin, supra. I contend that a jury finding that salt water was allowed to percolate below the surface does not establish negligence in a suit between lessor and leesee, and I further contend that such jury finding does not establish that the lessee used more land or more of the subsurface than was reasonably necessary. In this connection, it was prejudicial error for the trial court to admit in evidence over the strenuous objection of the petitioners, Rule 20 of the Railroad Commission of Texas. The rule reads:
“Fresh water, whether above or below the surface, shall be protected from pollution whether in drilling, plugging, or disposing of salt water already produced.” (Adopted by the Railroad Commission effective October 17, 1933.)
This is not a suit between oil operators and the owners of either surface or underground water. It is strictly a suit between the lessor and lessee of an oil and gas lease. The Railroad Commission has no authority, statutory or constitutional, to determine, as between the lessors and the lessee, either liability or negligence for permitting escape of the salt water from the permanent burning pit. The introduction of the rule was prejudicial and, no doubt, led the jury to believe that the Railroad Commission Order No. 20 fixed a standard of care for a lease operator on its own lease premises, and, therefore, the fact that salt water *100percolated below the surface and into the fresh water strata constituted negligence per se. I contend that the petitioners’ objections should have been sustained. The Bill of Exceptions is too lengthy to copy into this opinion, but the views herein expressed as to the admission of Rule 20 conform to the objections urged. This question has been properly preserved on appeal, both in the Court of Civil Appeals and in this court. Petitioners preserve the error in connection with their points of “no evidence.” It is argued under these points that there was no evidence establishing negligence in the usual sense, and that Rule 20 was used to impose negligence, whereas, most jurisdictions require proof of specific negligence as a basis of liability. The Railroad Commission’s Rule 20 had no place in this record. Petitioners argue that the Rule is no proof of negligence, and is no proof of foreseeability, that is, proximate cause. The Court of Civil Appeals did not squarely meet this issue, and this court has declined to mention the contention. There must be something more than the wording of Rule 20 itself to impose both negligence and foreseeability upon the lessees.
This court, in the case of Gulf Oil Corporation v. Alexander, supra, refused the application for writ of error, n.r.e., with the notation that “This order must not be taken as indicating either approval or disapproval of the views expressed by the Court of Civil Appeals as to the legal effect of Rule 20 promulgated by the Railroad Commission of Texas.” By this action, the Supreme Court expressly reserved its opinion on the effect of Rule 20. I feel that the issue is squarely presented here, and should be determined.
I cannot conceive of this court holding that Rule 20, which simply says- — “Thou shalt not pollute,” can be treated as establishing negligence, much less proximate cause. There was no evidence that other landowners in the area had suffered pollution or that the landowners or lessees could have foreseen or should have foreseen the pollution. As this court said in the case of Rudes v. Gottschalk, 159 Texas 552, 324 S.W. 2d 201, 205: “And even while accepting a statutory standard of negligence in lieu of that of the ordinary prudent man, we still retain the test of foreseeability of harm before liability is imposed under the doctrine of negligence per se.” (Emphasis added.)
In Texas & Pacific Ry. Co. v. Bigham, 90 Texas 223, 38 S.W. 162, 163, this court said: “* * * It would seem that there is neither a legal nor a moral obligation to guard against that *101which cannot be foreseen, and under such circumstances the duty of foresight should not be arbitrarily imputed.” (Emphasis added.)
Dean Page Keeton and Mr. Lee Jones, Jr., both eminent authorities on the question of Tort Liability and the Oil and Gas Industry, summed up the situation in an article in 35 Texas Law Review where it is said:
“If it develops that damage was sustained by or upon the leased premises, the principle employed by the courts as a starting point for discussion of the problem is that the mineral lease creates and vests in the lessee the dominant estate in the surface of the land for the purposes of the lease. As the holder of the dominant estate, the mineral lessee is permitted to occupy such space and do such damage as is reasonably necessary to conduct the operations permitted by the lease. This simply means that the lessor has, through the mineral lease, authorized by implication such conduct of the lessee, and of course there can be no recovery by him for damage resulting from authorized conduct on his property.”
The court, in reality, is holding that the mere happening of the salt water percolating downward and polluting the fresh water strata is sufficient to convict the petitioners of negligent acts against the public policy of the state, and that the findings of the jury support the judgment. It is my position that under the record in this case, the respondents cannot recover. The respondents cannot recover because, assuming negligence, they are just as negligent as the petitioners. They authorized by special contract the very act for which they now attempt to collect damages. The respondents should be held equally liable in damages to owners of neighboring land as the petitioners in the event such third parties prove the polluted fresh water strata is located under their land.
The construction of salt water pits for the storage of salt water was within the contemplation of the parties to the oil and gas lease here involved. The petitioners acted clearly within the rights granted under the terms of the lease to construct the salt water disposal pit and to use this pit for the storage of the salt water produced along with the oil. The court is attempting to invoke the doctrine of absolute liability. In the case of Turner v. Big Lake Oil Co., supra, the principle was the same as here. The only difference in the facts being that in Turner, the salt *102water overflowed, whereas here it penetrated downward. In each instance the salt water escaped from the pits. In each instance the pit was constructed in the usual and customary manner. The respondents in the present case knew that the “permanent burning pit” (the salt water pit) was to be an earthen pit; that it was located near the tank battery. There is no evidence that petitioners knew any more than lessors that the salt water would percolate downward into the subsurface strata of water. There is no evidence that petitioners intentionally permitted the salt water to escape. Consent to the use of the permanent burning pit was undisputed.
In Turner v. Big Lake, supra, this court declared that an oil operator has the legal right to store or dispose of oil or waste water on its own lease premises, and the mere fact that such oil or like waste escaped was not proof of negligence. In so holding, this court said: -
“Again in England there are no oil wells, no necessity for using surface storage facilities for impounding and evaporating salt waters therefrom. In Texas the situation is different. Texas has many great oil fields, tens of thousands of wells in almost every part of the State. Producing oil is one of our toiajor industries. One of the by-products of oil production is salt water, which must be disposed of without injury to property or the pollution of streams. The construction of basins or ponds to hold this salt water is a necessary part of the oil business. In Texas much of our land was granted without mineral reservation to the State, and where minerals were reserved, provision has usually been made for leasing and operating. It follows, therefore, that as to these grants and leases the right to mine in the usual and appropriate way, as, for example, by the construction and maintenance of salt water pools such as here involved, incident to the production of oil, was contemplated by the State and all its grantees and mineral lessees, that being a use of the surface incident and necessary to the right to produce oil.”
There are two other reasons why this judgment cannot stand. Both are interrelated with the question of no evidence. The first requires a rendition, the second requires a rendition or at least a remand to the trial court. The judgment should be reversed and rendered in favor of petitioners for the reason that respondents specially contracted for a valuable consideration for *103the construction of the permanent burning pit, and they knew that salt water and other waste would be there deposited. In fact, they surveyed out the area for the pit, and one of the respondents wrote a letter in regard to the pits to be dug, stating that in the event such pits (different than the permanent burning pit) were insufficient to retain the slush and mud used m the drilling of the wells, “then such excess shall be pumped in a line into the permanent burning pit to be dug now and used alongside of and with the tank batteries.” (Emphasis added.) The license to use the land for the construction of an earthen pit (not steel) for the disposal of the salt water and other waste material was for a consideration paid by petitioners in addition to the consideration for the oil and gas lease. The respondents knew the pit would not “hold water.” The other reason for rendition is that the disposal of the salt water in the earthen burning disposal was in accordance with the uniform custom of such operations in the area, and there was no proof that such custom was itself negligent. The customs of others engaged in like business is not the absolute test of negligence, but where the undisputed evidence shows affirmatively, as it does here, that the petitioners were conducting their business in accordance with the uniform custom of persons engaged in like business, it devolved upon the respondents, before they could recover, to produce evidence showing that such custom was negligent. Tex. Com. App., 212 S.W. 656.
The petitioners were, to say the least, entitled to have their requested issues 1, 2, and 2a on this question submitted to the jury. This was a vital defensive issue. I think it was established as a matter of law. If not, it was error for the trial court to refuse the submission of the requested defensive issues. See Texas & Pacific Railway Co. v. Van Zandt, 159 Texas 178, 317 S.W. 2d 528. It can well be argued that this error was reasonably calculated to cause and probably did cause the rendition of an improper judgment. The case should be reversed and rendered in favor of petitioners on the principal question here discussed. At most, this court should reverse and remand the case because of prejudicial procedural errors herein discussed.
ASSOCIATE JUSTICE STEAKLEY not sitting.