Acree v. Shell Oil Co.
Decision Date | 07 October 1982 |
Docket Number | Civ. A. No. 79-41-B. |
Citation | 548 F. Supp. 1150 |
Parties | Page W. ACREE, Elizabeth Smith Acree, William Smith Acree, and Kathy Sartori Acree v. SHELL OIL COMPANY, Shell Chemical, Inc., and ABC Pipeline Construction Company. |
Court | U.S. District Court — Middle District of Louisiana |
Russell L. Dornier, Leon Gary, Jr., Gary & Field, Baton Rouge, La., for plaintiffs.
Alvin B. Gibson, New Orleans, La., Tom F. Phillips, John W. Barton, Jr., Taylor, Porter, Brooks & Phillips, Baton Rouge, La., for defendants, Shell Oil Co. and Shell Chemical, Inc.
This case is before the Court for a determination of whether the defendants have a contractual right under the terms of an oil and gas lease to lay a pipeline across plaintiffs' property.
The plaintiffs, Page W. Acree, Elizabeth Smith Acree, William Smith Acree, and Kathy Sartori Acree (Acrees) filed this suit against Shell Oil Company (Shell), Shell Chemical Company (Shell), and an unknown pipeline company. Plaintiffs contend that they have been damaged due to a trespass of their property by the defendants who came upon plaintiffs' property, over plaintiffs' objection, and excavated a trench for the purposes of installing a pipeline to be used in the transportation of gas and other petroleum products. Shell argues that it has a right to lay the pipeline across plaintiffs' property under the terms of an oil and gas lease it has with the plaintiffs and others.
The parties have submitted this case to the Court on a stipulation of facts. The Court has also ordered that the present trial be limited to the rights and liabilities of the parties under the lease agreement and has severed the remaining issues in the case. The joint stipulation of facts filed in the record provides:
The relevant portion of the lease agreements provides:
"Lessor, in consideration of the sum of ONE THOUSAND DOLLARS AND OTHER VALUABLE CONSIDERATION ($1000.00 ovc), hereby leases and lets unto Lessee, the exclusive right to enter upon and use the land hereinafter described for the exploration for, and production of oil, gas, sulphur and all other minerals, together with the use of the surface of the land for all purposes incident to the exploration for and production, ownership, possession, storage and transportation of said minerals (either from said land or acreage pooled therewith), and the right to dispose of salt water, with the right of ingress and egress to and from said lands at all times for such purposes, including the right to construct, maintain and use roads, pipelines and/or canals thereon for operations hereunder or in connection with similar operations on adjoining land, and including the right to remove from the land any property placed by Lessee thereon and to draw and remove casing from wells drilled by Lessee on said land, the land to which this lease applies and which is affected hereby being situated in St. Landry Parish, Louisiana, and described as follows, to-wit:"
The underscored language, "or in connection with similar operations on adjoining land" was deleted from fifty-one leases and was only contained in the Tulane lease.
It is well settled that the intention of the parties to a contract must be determined in accordance with the plain, ordinary and popular sense of the language used in the agreement. Texaco, Inc. v. Vermillion Parish School Board, 244 La. 408, 152 So.2d 541 (1963).
Plaintiffs argue that the pipeline constitutes a trespass because it does not transport minerals produced upon the leased acreage or upon "acreage pooled therewith." Plaintiffs also contend that the language contained in the Tulane lease is not binding on them, but even if they are bound by this language, the Turner No. 3 well is not on "adjoining land." Thus, plaintiffs contend that in order for Shell to use the surface of plaintiff's land for the transportation of minerals produced on the leased property or "acreage pooled therewith," the entire tract must be pooled with the other acreage. The Acrees cite other examples in the lease where the additional language "or any part thereof" is used to define Shell's right to use leased property. According to the Acrees, if their interpretation of the lease is incorrect, there would be no need for the language "or any part thereof" in the lease. Finally, the Acrees argue in the alternative, that the use of their land for pipelines should be limited to that portion of the land which is pooled with the adjoining land containing the well site.
After carefully reviewing this very complex and difficult case, the Court finds that the meaning which must be given to the phrase "or acreage pooled therewith" is that if any acreage within the lease is unitized with a producing well, the surface of the leased tract may be used to transport production from the unit well. The Court further finds that Tulane granted Shell a valid lease and, thus, made Shell the owner of an absolute right. Finally, the Court finds that property which touches at a corner is "adjoining property" as...
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