Blasingame v. Anderson

• Decision Date: 15 January 1959
• Docket Number: No. 42790,42790
• Citation: 236 La. 505,108 So.2d 105
• Parties: W. H. BLASINGAME v. H. R. ANDERSON et al.
• Court: Louisiana Supreme Court

Page 105

108 So.2d 105

236 La. 505

W. H. BLASINGAME v. H. R. ANDERSON et al.

No. 42790.

Supreme Court of Louisiana.

Jan. 15, 1959.

Martin S. Sanders, Jr., Olla, for defendant-appellant.

A. D. Flowers, Jena, for plaintiff-appellee.

HAMLIN, Justice.

This is an appeal from a judgment of the trial court awarding plaintiff $2,236.73, an amount alleged to be due on contract, and recognizing a lien in his favor affecting defendant's¹ 29/128ths interest in an oil, gas, and mineral lease on certain described property.²

The following contract, signed only by plaintiff and his wife but admitted by defendant to be the contract between the parties, was executed in March, 1954.

'Whereas, the undersigned, W. H. Blasingame, married to and living with Velma Blasingame, now owns the oil gas and mineral lease on the following described property situated in La Salle Parish, Louisiana, to-wit:

'Southwest Quarter of Northeast Quarter (SW 1/4 of NE 1/4) Section Thirty-two (32), Township Nine (9) North, Range two (2) East.

'Which leasehold estate is subject to the usual one-eighth royalty reserved to the lessor.

'And, Whereas, the undersigned, W. H. Blasingame as the owner of said oil, and gas lease, plans, on or before the 1st day of June, 1954 to commence operations for drilling a well in search of oil and/or gas on said tract, said well to be known as the Blasingame Flora Brooks #1 Well.

'Now, Therefore, we, the undersigned, W. H. Blasingame and wife, Velma Blasingame, herein called assignors, in consideration of furnishing a complete rig to drill the Brooks #1 by H. R. Anderson, the receipt of which is hereby acknowledged, whose mailing address is Gloster, Miss., and who is herein called assignee: do hereby grant, bargain, sell and convey unto the said assignee, his heirs and assigns an undivided Twenty nine one hundred & 28th (29/128) working interest in and to said oil, gas and mineral lease, and the leasehold estate created thereby, and all rights and privileges granted therein.

'To Have and to Hold the said undivided interest unto the said assignee his (her) (their) heirs and assigns forever.

'It is further understood and agreed between the parties hereto as follows:

'1. On or before June 1, 1954, assignors agree to commence operations for the drilling of the said Blasingame Flora Brooks #1 well, and to continue the drilling thereof with due diligence to a depth of 3,500 feet below the surface of the earth, unless oil or gas be discovered at a lesser depth. In the event drilling operations are not begun as herein specified, then the said W. H. Blasingame shall forthwith refund the amount recited herein to be the consideration.

'2. If an oil and/or gas chalk or sand is encountered in the said well, which in the judgment of the said W. H. Blasingame might produce in paying quantities, then said assignee shall be furnished an itemized statement of the cost of labor, materials and equipment necessary to complete said well and place same on production. Assignee agrees to then promptly pay the undivided 29/128 8/8 part of the said cost of completion. Completion is intended to cover not only the completion of the well but all equipment necessary for operating same. Adjustment between estimated and actual cost shall be made within a reasonable time thereafter.

'3. If said well be a producer, said W. H. Blasingame or his designated agents, heirs or assigns shall proceed to operate same, and at the end of each month shall furnish an itemized statement of the cost of operation and maintenance to assignee, who agrees to promptly pay the undivided 29/128 part of same within ten days after receipt of said statement. The cost of damage insurance, bookkeeping, servicing and equipping the well shall be borne by assignee in the same proportion as the cost of operation and maintenance. Assignee, or his transferee, agrees to give written notice of any change of mailing address from that shown herein.

'4. Assignors shall have a lien on the interest of assignee in said lease and well, the oil and gas produced therefrom, the proceeds thereof, and the material and equipment thereon, to secure the payment of any sum or sums due under this assignment.'

Defendant complied with his obligation under the contract by furnishing a 'Wilson' drilling rig. This rig is involved in the reconventional demand hereinafter referred to, which has been abandoned.

The well was drilled and completed, and defendant was called upon from time to time to pay his pro rata of the expenses, which expenses were verbally recited to him by plaintiff. It is admitted by plaintiff that defendant paid $3,810 for which no bill was submitted.

On or about November 19, 1954, defendant received from plaintiff a statement (his first) enumerating expenses due on the drilling of the well. From the total amount was subtracted the sum previously paid, leaving an alleged balance of approximately $1,900 owed by defendant. To take care of the amount alleged to be due by him, defendant issued two checks, one drawn to Lane Wells Company, a furnisher of services, for an unpaid account and one to plaintiff's personal account.³ Shortly thereafter, defendant stopped payment on the checks for the reason that he questioned the verity of the statement which had been submitted to him.

In May, 1955, plaintiff filed suit against the defendant, praying for recognition of a lien under LSA-R.S. 9:4861 and 4862⁴ and demanding judgment in rem covering the property provisionally seized in the sum of $2,463.29, together with $50 for preparation of the lien and 10% Attorney fees plus interest. Alternatively, he asked for a personal judgment in the same amount. Named as a co-defendant was Martin S. Sanders, Jr., to whom Anderson had sold and assigned a 1/16th interest in the lease on March 1, 1955.

Defendant and his assignee filed exceptions of no cause or right of action, which were referred to the merits, and answered in the form of a general denial. A reconventional demand was filed by the defendant in which he prayed for $6,750, an amount claimed to have been paid by him for additional use of the 'Wilson' drilling rig he furnished on the well.

The trial judge deleted from the account an item alleged to be due Wilkin L. Holmes for digging pits, constructing a road, and furnishing an erected derrick, holding that the work was completed before the assignment to defendant.⁵ He rendered judgment in favor of plaintiff for $2,236.73.

In this Court counsel for the defendant stated that defendant had abandoned his reconventional demand and that only the four following account items were actually contested:⁶

1. Drilling Rig ('Rig Time');

2. Cardwell Pulling Unit;

3. Monthly Salary of the plaintiff;

4. Pumping Unit.

Defendant urges in his brief that the district court should not have allowed plaintiff to include in his statement pro rata charges for the rig, actually furnished by defendant, nor charges incurred prior to the agreed time at which defendant was to begin bearing his proportional share of the equipping and operating expenses.

The contract, supra, between plaintiff and defendant recited that defendant would furnish a complete rig to drill the Brooks No. 1 well. In order to comply with his obligation, defendant leased from C. E. Simmons for fifteen days a 'Wilson' rotary drilling rig. At the end of fifteen days the rig remained upon the land and was operated several times. Defendant states that for this use he had to reimburse C. E. Simmons some $6,750. Plaintiff's testimony is to the effect that the 'Wilson' rig remained upon the property with the consent of C. E. Simmons and that he, plaintiff, later secured a 'Cardwell' unit from Mr. Simmons for operational purposes. The charge made in the lien account is for the use of the 'Cardwell' unit. It is listed as 'Rig Time' at $124 per day.

The record does not disclose with certainty the reason why plaintiff discontinued the use of the 'Wilson' rig, which was rented by defendant for fifteen days. There is some testimony of record to the effect that a controversy existed with regard to its ownership and creditors were anxious to remove it from the premises.

The record discloses that plaintiff needed and operated the 'Cardwell' unit and that the charge of $124, 'Rig Time' per day for twenty-four days, or a total of $2,976, was assessed after May, 1954, at which time the well was about completed and Simmons' 'Wilson' rig had been returned. There is a certificate in the record executed by C. E. Simmons to the effect that 'W. H. Blasingame personally paid appearer for the use of said rig ('Cardwell') in labor and services' and that there were no charges due Simmons by plaintiff for the use of the pulling unit.⁷ Plaintiff's testimony is to the effect that the price charged for the 'Cardwell' unit was in line with that of other operators and was fair and just. This is not contradicted. Plaintiff stated that he had leased the rig from Mr. Simmons; that he paid his own labor; and that he furnished his own fuel and all supplies for the rig and its operation. The lien statement attached to the petition and appearing in the record contained no breakdown of the foregoing items. They were simply totalled under 'Rig Time.'

The contract, supra (paragraph 3), provides that at the end of each month plaintiff should furnish defendant an itemized statement of the Cost of operation and maintenance. Under such a stipulation, it was necessary and incumbent upon plaintiff to disclose to defendant Anderson by itemized statement how much he paid to lease the 'Cardwell' unit, or the value of the labor and services he rendered Simmons; plus the cost of labor, fuel, supplies and other incidental expenses in connection with its operation. This he did not do. After proof of these expenses defendant would then have to bear 29/128ths of the total thereof, as cost of operation and/or maintenance.

Under the circumstances set forth, we conclude that plaintiff's claim...