Amoco Pipeline Co. v. Admiral Crude Oil Corp.

Decision Date08 January 1974
Docket NumberNo. 73-1206.,73-1206.
Citation490 F.2d 114
PartiesAMOCO PIPELINE COMPANY, a corporation, Plaintiff-Appellee, v. ADMIRAL CRUDE OIL CORPORATION et al., Defendants-Appellees, v. TULSA CRUDE OIL PURCHASING COMPANY, Defendant-Appellant.
CourtU.S. Court of Appeals — Tenth Circuit

Irvine E. Ungerman, of Ungerman, Grabel & Ungerman, Tulsa, Okl. (James O. Ellison, of Boone, Ellison & Smith, Tulsa, Okl. and David F. Boyd, Jr., Albuquerque, N.M., with him on the brief), for appellant.

Harold L. Hensley, Jr., of Hinkle, Bondurant, Cox & Eaton, and Roger L. Copple, of Jennings, Christy & Copple, Roswell, N.M. (Wm. B. Browder, Jr., Robert C. Bledsoe, and Stubbeman, McRae, Sealy, Laughlin & Browder, Midland, Tex., with them on the brief), for appellees.

Before MURRAH, SETH and DOYLE, Circuit Judges.

SETH, Circuit Judge.

The plaintiff-appellee, Amoco Pipeline Company, a common carrier of crude oil, filed an interpleader suit in the United States District Court for the District of New Mexico under 28 U.S.C. § 1335. The defendants included Tulsa Crude Oil Purchasing Company and its subsidiary, Admiral Crude Oil Corporation. Involuntary petitions in bankruptcy had been filed in Oklahoma and in Texas against both corporations, and their respective trustees were named as defendants. Admiral Crude Oil Corporation had been purchasing crude oil in New Mexico from the producer parties to the interpleader, and it was being transported to Admiral by Amoco under its regular tariffs.

The plaintiff carrier tendered into the New Mexico court proceeds from the sale of crude oil, and also crude oil in storage which had been received from the producers for transportation to Admiral as the purchaser. The plaintiff asked that the defendants be required to assert their several claims thereto; furthermore the plaintiff was asserting a lien thereon for transportation and demurrage charges.

The trustee for Tulsa Crude appeared in the New Mexico court and asked that the interpleader proceedings be stayed for the reason that the reorganization court in Oklahoma had previously issued an order that litigation involving Tulsa Crude or its assets be enjoined and restrained. The New Mexico court denied the stay, decided the merits, and rendered a judgment adverse to the position advanced by the trustee. This appeal was then taken.

The issues on appeal relate to the jurisdiction of the interpleader court in New Mexico as against the jurisdiction of the Oklahoma reorganization court as advanced by the trustee. These issues in turn concern New Mexico law governing possession of, and title to, the crude being transported.

Prior to February 1, 1972, the oil producers delivered crude oil to Amoco for transmission to Admiral. From November 1971 through January 1972, Admiral did not pay Amoco its regular, published charges for the gathering, transporting, and storing of crude oil. Amoco therefore asserted a claim of lien against 49,953.98 barrels of crude oil which it had received from the producing defendants and which were in Amoco's possession in its storage facilities in Lea County, New Mexico. Admiral was given notice of this fact.

On February 10, 1972, Amoco tendered the crude oil to Admiral conditioned on payment of its lien claim; Admiral refused to pay the lien claim and refused to accept the oil, which remained thereafter in Amoco's Lea County, New Mexico, storage facilities.

On February 16, 1972, Tulsa Crude was adjudicated bankrupt in the Oklahoma court, and on March 7th, the court accepted the corporation for reorganization under Chapter X and entered the usual injunctive order against actions against the corporation or its property. On February 23, 1972, Admiral was adjudicated a bankrupt in the Northern District of Texas and later (September 21st) the court transferred the proceedings to the Oklahoma court where the proceedings concerning the parent corporation, Tulsa Crude, were pending.

Prior to February 10, 1972, the oil producers discovered that Amoco had received oil from them for Admiral when Admiral was insolvent; the checks which had been tendered to the oil producers by Admiral in payment for oil sold to it in December 1971 were dishonored by the drawee bank and returned marked "insufficient funds." The oil producers therefore notified Amoco and other interested parties to stop delivery of crude oil to or for the benefit or account of Admiral, thus exercising a right of stoppage in transitu and reclamation. Amoco notified the producers that it would enforce its lien against the oil in its possession as Admiral had refused to pay the lien claim and accept delivery of the oil.

Amoco thereafter sold 13,000 barrels of crude oil which it had in its possession on March 15, 1972, to satisfy its common carrier lien against Admiral of $39,564.52, and continued to assert a lien against the balance of the proceeds of sale and 36,953.98 barrels in storage for unpaid demurrage and storage charges against Admiral.

The New Mexico court found that at all material times the crude oil, or the proceeds from its sale, was in the sole and exclusive possession of Amoco, the carrier, or in the registry of the court. This finding is supported by the record.

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23 cases
  • Gulf Oil Corp. v. F. P. C.
    • United States
    • U.S. Court of Appeals — Third Circuit
    • September 7, 1977
    ...the Uniform Commercial Code, which we assume is applicable to the Gulf-Texas Eastern contract. Cf., e. g., Amoco Pipeline Co. v. Admiral Crude Oil Corp., 490 F.2d 114 (10th Cir. 1974); Oskey Gasoline & Oil Co. v. OKC Refining Inc., 364 F.Supp. 1137 (D.Minn.1973). An express warranty under U......
  • Green v. Skulute
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    • December 7, 1993
    ...is well settled that a federal district court has jurisdiction to decide whether it has jurisdiction. Amoco Pipeline Co. v. Admiral Crude Oil Corp., 490 F.2d 114, 116 (10th Cir.1974). Federal courts are courts of limited jurisdiction, however, and there is a presumption against jurisdiction......
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