Humble Oil & Refining Co. v. Poe, 888-4764.

• Decision Date: 25 June 1930
• Docket Number: No. 888-4764.,888-4764.
• Citation: 29 S.W.2d 1019
• Parties: HUMBLE OIL & REFINING CO. v. POE.
• Court: Texas Supreme Court

29 S.W.2d 1019

HUMBLE OIL & REFINING CO. v. POE.

No. 888-4764.

Commission of Appeals of Texas, Section B.

June 25, 1930.

Error to Court of Civil Appeals of Eleventh Supreme Judicial District.

Action by J. N. Poe against the Humble Oil & Refining Company. A judgment for defendant was reversed and the cause remanded by the Court of Civil Appeals (288 S. W. 264), and defendant brings error.

Judgment of Court of Civil Appeals reversed, and judgment of District Court affirmed.

Scott W. Key, of Eastland, and John C. Townes, Jr., and Hines H. Baker, both of Houston, for plaintiff in error.

Grisham Bros., of Eastland, for defendant in error.

LEDDY, J.

Defendant in error was the owner of a certain royalty interest in the minerals produced from eighty acres of land, upon which plaintiff in error held an oil and gas lease. He sought a recovery against it upon causes of action set forth in four separate counts in his petition.

In the first count damages were claimed for alleged conversion of casing-head gas.

In the second count a recovery was asked of a reasonable royalty, which was averred to be 25 per cent. of the gross production of casing-head gas produced from the leased premises.

The third count set forth that the one-eighth royalty, stipulated in the lease, of the oil produced and saved from the premises was intended to and did cover casing-head gas, and that he had been refused payment thereon to his damage in the amount alleged.

The fourth count charged that plaintiff in error had failed to comply with the obligations of the lease by refusing to drill an offset to what was known as the Nelson well, located on an adjacent tract within 150 feet of the property line, and that such well had drained oil from the leased premises, for which damages were asked.

An examination of the evidence adduced by defendant in error to establish the allegations under the first three counts of his petition shows that he wholly failed to produce sufficient proof to entitle him to a judgment under either of said counts. The record is completely silent as to whether any oil or casing-head gas was produced from the leased premises. It is merely disclosed that a well was drilled by plaintiff in error which produced gas and the potential capacity of such well by monthly open flow tests over a given period was shown. This proof was supplemented by an agreed stipulation that an average of about .33 gallons of gasoline could have been manufactured from each one thousand cubic feet of gas produced from said well and that the average market price of such gasoline would have been something over 9 cents per gallon.

It is difficult to conceive upon what theory defendant in error was entitled to recover for gasoline which could have been manufactured from gas produced from a gas well, in the face of the provision in the lease that "lessee agrees to pay the lessor at the rate of $250 each year, payable quarterly in advance, for the gas from each well where gas only is found, while the same is being used off the premises." The undisputed evidence shows that the stipulated rental for the gas used from this well was paid to and accepted by the defendant in error. There is not a scintilla of evidence showing that any gasoline was manufactured from the gas produced from this well or that any oil or casing-head gas was produced therefrom.

There is a well-defined distinction in law between gas produced from a gas well and casing-head gas....