Court Opinion

ID: 9864430
Source: CourtListenerOpinion
Date Created: 2023-09-25 13:05:31.423607+00
Date Added: 2024-06-11T12:12:06.799266
License: Public Domain

McCulloch, C. J., (on rehearing). The views entertained by the majority call for modification of the original opinion, as well as of the judgment of this court in its directions to the trial court on remand of the cause. Most of what is said in the original opinion is in accord with the views of the majority, but in some important respects the opinion does not conform to their present views. We are of the opinion that there is no necessary conflict between the respective leases held by the parties from the same lessor. Our conclusion upon the facts is that appellee is entitled to recover from appellant the value of the oil taken by appellant from appellee’s reservoir, except that portion which escaped from appellant’s own pipe line or wasted from its own wells. In other words, our conclusion is that appellant was entitled to recapture its own oil, and no more. The lease held by appellant did not confer the right, independently of the conservation of its own oil, to erect a pick-up station or stations on the leased premises. There is nothing in. the lease referring to the right to capture fugitive oil, and the only right in that respect is that which is merely incidental to the right to preserve its own product. A fair interpretation of appellant’s lease is that it had the right to erect a pick-up station or stations necessary to protect its interest in the preservation, of its own product, and would be entitled to the use of an available site for the most efficient accomplishment of that purpose. Incidentally, it would be entitled to hold fugitive oil captured in its own station except as against the true owner. The subsequent lease to appellee placed it in the shoes of the lessor, and conferred all the rights with respect to the erection, and operation of pick-up stations, subject only to any superior rights of the prior lessee which might be in conflict. One of the leases was in subordination to the other, and they were not conflicting. A conflict might arise in the assertion of rights under the leases, but there was no conflict upon the face of the instruments themselves, for the rights and interests conferred by the lessor in the two ‘leases were in perfect harmony. No conflict could arise unless a hostile claim arose between the lessees as to the occupancy of a particular site for a pickup station. According to the undisputed evidence in this case, no such conflict arose, for the simple reason that appellant had never erected a pick-up station nor made any effort to do so, nor did it ever make any objections to the appellee to the latter erecting a station until the oil in controversy had been captured 'by appellee and appellant started to retake it, over appellee’s objection. The question of superiority of rights in the erection of a station at that particular place is not involved in the present controversy. If the site occupied by appellee is the only available place for the erection of a pick-up station for use by appellant in preserving its own oil, then the rights of appellant are superior, and those rights may be asserted. But, as before stated, appellant had never attempted to erect a pick-up station, and appellee did not become a trespasser by occupying the site which appellant might have claimed if it was the one most available for use in the preservation of its own product. When the question of priority of the right to use a particular site arises, it must be determined upon the question whether or not it is essential to appellant in preserving its own oil. But that is not the question involved in the present controversy. Appellee’s occupancy of the site was rightful until appellant asserted its superior rights thereto. Appellee being rightfully in possession, it is entitled to hold the captured oil against all comers, including appellant, except as against the true owner. The views now expressed are not in conflict with the case of Caldwell-Guadalupe Pick-Up Stations v. Gregg, 276 S. W. 342, which has been so earnestly pressed upon our attention by counsel and relied on by the writer of the original opinion. We think that our views are really in harmony with the decision, in that case. The facts there were that the plaintiff was the owner of an oil and gas lease, and erected a pick-up station for the purpose of preserving its own product. The defendant was the holder of the junior lease, and also erected a pick-up station above the site occupied by the plaintiff, and which interfered with the operation by the latter of its station. Suit was brought by the plaintiff, alleging- interference with superior rights, and under the decision he recovered on the ground that there was a necessary conflict between the assertion by the lessees of their respective claims. If the appellant in the present case had erected a pick-up station for the preservation of its own oil, it would have been in the same attitude as the plaintiff in the Texas case, and could have prevented appellee from erecting or operating a station which interfered with its own rights under the prior lease. But, as we have already shown, there is no such state of facts existing, for appellant has never erected a pick-up station nor asserted its right to do so until it became necessary to recapture its own oil, and then it claimed not only its own product but the fugitive .oil which had flowed down the stream and had escaped from the wells of other owners. Appellant is therefore in no attitude to claim the fugitive oil which had been captured by appellee; it can claim its own oil and no more. The judgment of this court will be modified, so as to direct the trial court to hear further testimony, if offered, as to the value of oil taken from the reservoir of appellee other than oil which had escaped from appellant’s pipe lines or wells, and to render judgment therefor in favor of appellee. To that extent, and no further, the petition for rehearing is sustained. Wood, J., dissents.