Court Opinion

ID: 9642950
Source: CourtListenerOpinion
Date Created: 2023-08-22 18:13:37.731505+00
Date Added: 2024-06-11T18:10:55.166079
License: Public Domain

STEAKLEY, Justice
(dissenting).
I am in full agreement with the majority holding that the Railroad Commission cannot impose different or additional penalties or sanctions otherwise provided by law as punishment for unlawful acts. But this is not the problem as I view the case.
I do not agree that Harrington obtained absolute drilling rights upon the granting to him of the original drilling permits, as exceptions to Rule 37, to prevent confiscation of his minerals, or that Harrington’s rights are unaffected by his entire failure to drill and produce the wells authorized by the permits.
I assume, as does the majority opinion, that Harrington intentionally deviated the wells so as to bottom the wells under, and hence so as to produce oil from, the leases belonging to his neighbors in which he owned no interest. It is self-evident that these drilling operations, and the subsequent production of oil, were different from, and contrary to, the drilling and production rights authorized by the permits. In no sense can it be said that Harrington drilled for oil, and has subsequently produced oil, pursuant to, or under, or as authorized by, the permits; his drilling operations were so foreign to the permits for which he applied, and which he was granted, as to be the same, in legal effect, as if he had started drilling on his neighbor’s surface. In the context here, an intentional deviation so as to complete a well under the property of another is no different from starting the well on the surface of land belonging to the other and drilling to the same place. Surely the majority cannot say that “Utilization of a permit right is effected when a well is drilled” on the surface of another. Yet wherein is there substantial difference in deliberately drilling from an authorized surface point to an unauthorized subsurface point under the lease of another? But, continues the majority opinion, the rights granted by the permits here “were utilized with reasonable diligence through exercise of the right to drill, albeit the well bores were deviated to a greater degree than was authorized and were bottomed under adjoining leases.” Would the majority say the same “albeit the well bores were started on lands belonging to another and bottomed under leases belonging to another,” and thus just as much not authorized ?
The majority opinion also says that the necessity for the original permits to prevent confiscation' “is not open to question at this late hour.” With this I agree. But what is open to question is whether the new permits sought by Harrington to redrill, and correct the intentional deviations, are necessary to prevent confiscation of his minerals at this time. This is not to say that the continuing effect of Rule 37 permits, under which operations have been, and are being, conducted in good faith and in substantial conformity, are open to question. It is to say that when the holder of a validly issued permit intentionally fails to drill and produce as authorized, in the substantial and flagrant manner shown here, and after such a course of conduct invokes the jurisdiction of the Commission by an application for a permit to drill as originally authorized, the question of whether the permit to redrill is required to prevent confiscation necessarily recurs and is subject to consideration by the Railroad Commission. Otherwise, the holder of a permit would be permitted to drain his neighbor indefinitely, or until dry, by means of an intentional deviation under the neighbor’s lease, and then assert the right to drill and produce his own lease under the same permit.
This is not a forfeiture of rights; it is a case where rights have never accrued or *900vested. The permits could have ripened into rights of such a nature as to preclude re-examination of the question of the necessity of the permits to prevent confiscation. But the holder of the permit chose not to drill the wells authorized by the permits. He has never drilled them. He chose to drill to, and obtain production from, a place, and under a lease, for which he had not been granted authority, and in which he had no rights; he has drilled wells for which he had no permits. His wells are outlaw wells. He cannot claim rights he would have had had he drilled the wells authorized by the permits. I am unable to follow the reasoning of the majority opinion that all the permit holder was required to do to utilize his permits, and to possess all rights incident thereto, was to break ground at the authorized surface location on his own leases; and this notwithstanding that when he broke ground he was headed for his neighbor’s lease. This is not a matter of the permits being conditioned on the drilling of a straight hole, as the majority puts it; it is a. matter of deliberately not drilling the wells authorized by the permits. It is quite obvious why one drilling a deviated well to be intentionally bottomed under the lease of his neighbor would not start the drilling on the surface of his neighbor where all could see what was happening.
Now, after drilling and producing for many years by means of wells which he had no authority to drill, and which the Railroad Commission could not authorize him to drill, Harrington seeks authority to drill and produce wells on his own lease. He is entitled to do so only if now, under present conditions, the wells are necessary to prevent confiscation of his minerals.
I would think that there must be a bona fide effort to drill a well in conformity with a drilling permit granted to prevent confiscation, together with substantial compliance therewith, before the conditions with reference to confiscation, upon the basis of which the permit was granted, will no longer be open to question. I do not think that this can exist where a well is intentionally drilled in nonconformity with the permit, and for the purpose of producing oil from a place and in a manner for which no authority has been granted or could be granted. Whatever the resulting situation may be in this latter instance should be subject to consideration by the Railroad Commission in determining whether the well originally authorized, but not drilled, is still necessary to prevent confiscation. If the Railroad Commission denies an application to redrill, as it has done here, its order is valid if supported by substantial evidence. The orders here have not been shown to be otherwise; they must therefore be upheld regardless of the reasons assigned by the Commission in support of its action.
I would affirm the judgment of the trial court.
NORVELL, J., joins in the dissent.