Gruger v. Phillips Petroleum Co.

• Court: Oklahoma Supreme Court
• Writing for the Court: HURST, Justice.
• Citation: Gruger v. Phillips Petroleum Co., 135 P.2d 485, 192 Okla. 259, 1943 OK 48 (Okla. 1943)
• Decision Date: 16 February 1943
• Docket Number: 30244.
• Parties: GRUGER et ux. v. PHILLIPS PETROLEUM CO.

135 P.2d 485

192 Okla. 259, 1943 OK 48

GRUGER et ux. v. PHILLIPS PETROLEUM CO.

No. 30244.

Supreme Court of Oklahoma

February 16, 1943

Rehearing Denied April 6, 1943.

Syllabus by the Court.

1. The law of capture, under which oil and gas belongs to the one who lawfully reduces it to possession, obtains in Oklahoma except as it is or may be modified or regulated under laws enacted under the police power such as proration and spacing statutes and zoning ordinances.

2. The right of a lot owner in Oklahoma City to participate in the production of oil or gas in the vicinity of his lot, under the zoning ordinance, where such producer does not have a lease on such lot, is derived from an order made by the adjustment board of the city or by the district court on appeal.

3. Plaintiffs in their petition alleged that defendant had taken oil and gas leases upon 51 per cent of the lots in Block 39 Maywood Addition to Oklahoma City, and had obtained from the city board of adjustment a permit to drill a well upon said block; that it had not drilled on the block, but had communitized its leases thereon with adjoining and nearby blocks leased by it, and had drilled eleven wells upon the adjoining and nearby blocks; that the lessors in block 39 are sharing in the production from such wells in the proportion that the area of their lots bears to the entire communitized area; that by such procedure defendant is obtaining the oil from under the lots of plaintiffs, and plaintiffs demanded an accounting for oil alleged to have been drained from their lots by defendant through its adjacent wells. Plaintiffs did not allege that defendant refused to permit them to share in the production of oil and gas from the communitized area on the same basis as the lot owners in block 39 who had leased their lots to defendant, or that they appeared before the board of adjustment to obtain an order protecting their rights under the zoning ordinance or that such an order was obtained, or facts excusing their failure to appear before the adjustment board. Held, the petition did not state a cause of action, and defendant's demurrer thereto was properly sustained.

Appeal from District Court, Oklahoma County; Sam Hooker, Judge.

Action by Joseph Gruger and wife against the Phillips Petroleum Company, a corporation, for an accounting. Defendant's demurrer to the petition was sustained, the action was dismissed, and plaintiffs appeal.

Affirmed.

BAYLESS J., dissenting.

B. B. Blakeney and B. B. Blakeney, Jr., both of Oklahoma City, for plaintiffs in error.

Don Emery and Rayburn L. Foster, both of Bartlesville, and E. G. DeParade and Harry D. Turner, both of Oklahoma City, for defendant in error.

HURST Justice.

Joseph Gruger and Marie Gruger sued Phillips Petroleum Company for an accounting because of the drainage of oil and gas from two lots in Oklahoma City owned by them. The trial court sustained a demurrer to the petition, and the plaintiffs elected to stand on their petition and refused to plead further. Thereupon the case was dismissed. Plaintiffs appeal.

The petition contained these allegations, in substance: That plaintiffs at all times therein mentioned were the owners of lots 2 and 3, Block 39, Maywood Addition to Oklahoma City that on October 7, 1935, the defendant filed its application with the Building Superintendent of Oklahoma City for a permit to drill a well for oil and gas on said block, stating that it was the owner of community oil and gas leases covering more than 51 per cent of said block; that on October 28, 1935, the board of adjustment approved the application and granted the permit; that said Block 39 is less than two and one-half acres in area, and that under Ordinance No. 3944 of Oklahoma City (the zoning ordinance) the drilling of only one well for oil and gas on the block is permitted, and that by virtue of its permit defendant is given the exclusive right to drill for oil and gas thereon; that defendant communitized its leases in Block 39 with some twenty-seven other blocks in Maywood Addition and in two adjacent additions upon which it held leases; that it had developed and is producing oil from the communitized area as one lease, having drilled eleven wells thereon, and is paying to all of its lessors in such area royalty based on the proportion which the acreage of the lots owned by them bear to the entire leased area; that defendant has not drilled a well upon Block 39; that the eleven wells referred to were drilled upon the communitized area by defendant so as to produce a maximum amount of oil therefrom at a minimum expense, and to avoid drilling upon each of the blocks so communitized, and with the intent and design to drain the oil and gas from all of Block 39, including the lots of plaintiffs, without paying plaintiffs and other property owners in said block, who had not leased their lots to defendant, for the oil so drained from their lots; that by procuring the permit to drill and thus preventing plaintiffs and other property owners from drilling or causing a well to be drilled, defendant became "impliedly obligated to then pay royalty to them for the oil and gas taken from their properties"; that defendant, by reason of its said acts, has taken the property of plaintiffs without compensation therefor and that it should be required to account to plaintiffs for all the oil and gas so taken from their lots, and for all which may be taken from their lots...