DLB Energy Corp. v. Oklahoma Corp. Com'n, 74365

• Decision Date: 29 January 1991
• Docket Number: No. 74365,74365
• Citation: 1991 OK 5,805 P.2d 657
• Parties: DLB ENERGY CORP., Appellant, v. The OKLAHOMA CORPORATION COMMISSION and French Petroleum Corporation, Appellees.
• Court: Oklahoma Supreme Court

Page 657

805 P.2d 657

1991 OK 5

DLB ENERGY CORP., Appellant, v. The OKLAHOMA CORPORATION COMMISSION and French Petroleum

Corporation, Appellees.

No. 74365.

Supreme Court of Oklahoma.

Jan. 29, 1991.

Appeal from the Corporation Commission of Oklahoma.

The appellant, DLB Energy Corp. (DLB Energy), filed a motion to stay four related

causes before the appellee, Oklahoma Corporation Commission (Corporation Commission), pending a judgment in a related district court action. The administrative law judge denied the motion to stay proceedings, and the Corporation Commission en banc affirmed. we find that the denial of a motion to stay proceedings is an interlocutory order, and that it is not appealable

APPEAL DISMISSED.

Robert A. Miller, Oklahoma City, for appellant, DLB Energy Corp.

Lindil C. Fowler, Jr., Leslie Wilson Pepper, and Lu Willis, Oklahoma City, for appellee, Oklahoma Corp. Com'n.

Gregory L. Mahaffey and Martha Martin, Oklahoma City, for appellee, French Petroleum Corp.

KAUGER, Justice.

This is an appeal from the denial of a motion to stay four related causes ¹ before the appellee, Oklahoma Corporation Commission (Corporation Commission), pending a judgment in a related district court action. We find that the denial of a motion to stay proceedings is an interlocutory order, and that it is not appealable.

FACTS

On August 14, 1985, the Oklahoma Corporation Commission (appellee/Corporation Commission) issued increased density order No. 283661 providing for the predecessors in interest of the appellant, DLB Energy Corp. (DLB Energy), and the appellee, French Petroleum Corporation (French), to re-complete the Harvey Steffen No. 2 (DLB well) and to drill a third well, the Harvey Steffen No. 3 (French well), in the Harvey Steffen Unit (unit) to the Atoka-Morrow formation. ² When the application was filed, Texaco was operating the unit well--the Harvey Steffen No. 1 (No. 1 well). Order No. 283661 provides that the three wells are to share a single unit allowable to be established by taking the initial potential test from the best well in the section. Under order No. 283661, the No. 1 well has priority to the unit allowable, the DLB well has second priority, and the French well is authorized to produce the remaining portion of the allowable not produced by the other two wells. However, the order provides that the authority to drill the two additional increased density wells expires one year after the order is executed unless the wells are commenced on or before the expiration date. ³

An attempt to deepen and to re-complete the DLB well began on November 25, 1985. Drilling ended on January 11, 1986. The DLB well's completion report stated that the well was dry, that the formation was It is undisputed that the French well was commenced within the time frame outlined by order No. 283661. The controversy here revolves around the central issues in four related causes before the Corporation Commission--whether the DLB well was commenced within the time constraints of order No. 283661, and whether it is entitled to priority production of the unit allowable. ⁵ The right to produce hydrocarbons from the Harvey Steffen Unit is also the subject of an action in district court. DLB Energy asserts its predecessors in interest and those of French executed a farmout agreement (agreement) on April 18, 1985, providing for a virtually identical production priority schedule. On July 10, 1989, DLB Energy filed an action in district court to enforce the private agreement.

                too tight, and that no pipe liner was run.  The DLB well was plugged by setting an iron bridge plug above the Atoka-Morrow.  On December 20, 1988, after having initially denied its application, the Corporation Commission approved DLB Energy's request to reenter the DLB wellbore. 4  DLB Energy began drilling on December 21, 1988.  It reentered the DLB wellbore, drilled out the cast iron bridge plug, and re-completed the well in the Atoka-Morrow.  Drilling ended on January 9, 1989, and the DLB well began producing on February 22, 1989
                

On September 12, 1989, DLB Energy filed a motion to stay proceedings in the four causes before the Corporation Commission concerning the Harvey Steffen Unit. It requested that the Corporation Commission causes be stayed pending a decision in the district court action. DLB Energy asserted: 1) that a decision in the district court action could impact on French's standing to proceed before the Corporation Commission; 2) that the district court would be charged with determining the contract rights of both parties under the farmout agreement; and 3) that by ruling in the causes, the Corporation Commission might issue an order inconsistent with the district court's judgment and allow French to circumvent its contractual obligations. The administrative law judge heard argument on the motion on September 20, 1989. A decision was rendered from the bench denying the motion to stay on September 29, 1989. The administrative law judge found that no evidence was properly presented to show that a matter of purely private rights was at issue ⁶ and that French had standing pursuant to 52 O.S.1981 § 112, ⁷ 52 O.S.Supp.1988 § 87.1, ⁸

                and Spaeth v. Corporation Comm'n, 597 P.2d 320-21 (Okla.1979). 9  DLB Energy appealed the administrative law judge's ruling to the Corporation Commission en banc.   The cause was argued to the Corporation Commission en banc on October 10, 1989.  On November 6, 1989, the Corporation Commission en banc entered an order affirming the administrative law judge. 10
                

THE DENIAL OF A MOTION TO STAY PROCEEDINGS IS AN

INTERLOCUTORY ORDER AND IT IS NOT APPEALABLE.

French objected to the appeal of the instant cause by including a motion to dismiss in its response to DLB Energy's petition in error and preliminary statement. French asserted that the Corporation Commission's order denying the motion to stay proceedings was interlocutory or intermediate, and that it was not appealable. The motion to dismiss was renewed on the same bases in French's answer brief. DLB Energy filed a brief setting forth its contentions that the Corporation Commission lacked jurisdiction, that French lacked standing, and that the issuance of a stay would not adversely affect the parties. DLB Energy's brief does not contain argument responding to the issue of reviewability, and DLB Energy did not file a reply to French's answer brief. ¹¹ It is against this backdrop that we must determine whether an appeal will lie from the denial of the motion to stay proceedings.

An interlocutory order is an order which is not "final." ¹² Whenever a tribunal's ruling does not culminate in a judgment, its decision is interlocutory. ¹³ Interlocutory orders do not operate to preclude a party from proceeding further in the cause nor do the orders prevent judgment. ¹⁴ The issuance of an interlocutory order leaves the parties in court to try the issues on the merits. ¹⁵ An interlocutory order may not be appealed unless: 1) it falls within a class of interlocutory orders No certified question is presented, and we have not determined previously whether the denial of a motion to stay proceedings is appealable by right. However, in Daggs v. Phillips, 184 Okla. 625, 89 P.2d 359-60 (1939), we found that the staying of proceedings pending an appeal in a related cause was an interlocutory order not subject to appellate review prior to final judgment. In Daggs, a forcible entry and detainer action was filed before the justice of the peace, and a judgment was rendered in favor of Daggs. The judgment was appealed to the district court. When the judgment in the action before the justice of the peace was appealed, there was already an action pending in district court in which Daggs sought injunctive relief. The district court issued an order holding a decision in the appeal in abeyance pending a decision in the action requesting an injunction. An appeal was taken from the motion staying proceedings. Relying on the rule previously outlined that an appeal will not lie from an intermediate or interlocutory order made during the pendency of an action which leaves the parties in court to try the issues on the merits unless the appeal is from a special order whose appeal is authorized by statute ¹⁸--this Court held that the appeal must be dismissed. The statute governing appellate jurisdiction in Daggs is substantially similar to 12 O.S.1981 § 952(b)(2), ¹⁹ the current statutory delineation Here, rather than granting the motion to stay proceedings, as did the district court in Daggs, the Corporation Commission refused to stay its proceedings pending a resolution of the district court action. If an order granting a stay in a civil proceeding is interlocutory and not subject to review, ²⁰ we do not perceive how the denial of the same motion may be appealed before judgment is entered. ²¹ We do not have before us an order of the Corporation Commission which is part and parcel of an uncompleted administrative inquiry as we did in French Petroleum Corp. v. Oklahoma Corporation Comm'n, 805 P.2d 650, 652 (Okla.1991) (in which the Corporation Commission issued a temporary order pending a decision on the merits) or in H & L Operating Co. v. Marlin Oil Corp., 737 P.2d 565, 568 (Okla.1987) (in which an emergency order issued and was stayed pending the determination of a well location). Here, the Corporation Commission has simply determined that it will proceed with the instant causes. Neither are we presented with a situation similar to Tenneco Oil Co. v. Oklahoma Corp. Comm'n, 775 P.2d 296, 298 (Okla.1989), in which we found that the Corporation Commission should have stayed its proceedings based on principles of comity. In Tenneco, a federal district court decision was on appeal when the related cause was filed with the Corporation Commission. Here, there has been no decision in the district court action. We find that the denial of a motion to stay proceedings is an interlocutory order and...