Humphreys Oil Co. v. Tatum

• Decision Date: 27 July 1928
• Docket Number: No. 4992.,4992.
• Citation: 26 F.2d 882
• Parties: HUMPHREYS OIL CO. et al. v. TATUM et al.
• Court: U.S. Court of Appeals — Fifth Circuit

26 F.2d 882 (1928)

HUMPHREYS OIL CO. et al. v. TATUM et al.

No. 4992.

Circuit Court of Appeals, Fifth Circuit.

June 18, 1928.

Rehearing Denied July 27, 1928.

Clyde A. Sweeton, of Houston, Tex. (C. S. Bradley, of Groesbeck, Tex., and Vinson, Elkins, Sweeton & Weems, of Houston, Tex., on the brief), for plaintiffs in error.

N. B. Williams and Clay McClellan, both of Waco, Tex. (Williams, Williams, McClellan & Lincoln, of Waco, Tex., on the brief), for defendants in error.

Before WALKER, BRYAN, and FOSTER, Circuit Judges.

FOSTER, Circuit Judge.

This suit was brought by appellees, Joe Will Tatum and his wife, Lizzie Tatum, and L. C. Puckett and G. Stratton, against the Humphreys Oil Company and the Pure Oil Company, appellants, to recover damages alleged to have been caused by the failure of appellants to properly develop, and to protect from drainage by other wells, in close proximity, some 25 acres of land in Limestone county, Tex., in what is known as the Mexia oil field, to which Tatum and his wife held the fee-simple title. There was a verdict in favor of appellees in the sum of $10,000, on which judgment was entered. Error is assigned to certain portions of the general charge and to the refusal of the court to direct a verdict in favor of appellants. These errors may be considered together.

The undisputed material facts are these: Appellees Tatum and wife executed a lease on about 25 acres of land, which formed the northwest half of a lot of 50 acres owned by them, to A. H. Bell, on July 19, 1919, the lease to remain in force for a term of five years from date and as long thereafter as oil or gas or either of them would be produced from the said lands by the lessee, for a consideration of $125 and a further consideration of one-eighth of all the oil produced and saved from the leased premises, to be delivered free of cost to the lessor in pipe lines connected with any wells that might be drilled. The lease also contained the stipulation that, if no well was commenced on the land on or before July 25, 1920, the lease should terminate as to both parties, unless the lessee should pay the sum of $25 per year, to operate as rental, for the privilege of deferring the commencement of a well. The lease was transferred through various parties to the Humphreys Oil Company, and in turn was taken over and operated by the Pure Oil Company, which succeeded to the business and assets of the Humphreys Oil Company. Tatum and wife transferred one-half of their rights under the lease to the other appellees, Puckett and Stratton. A well was drilled by the Houston Oil Company on what is known as the McCraw lease, adjoining the Tatum property, about 180 feet from the line. After this a well known as Tatum No. 1 was drilled by appellants in the northeast corner of the Tatum property, 172 feet south of the north line and 180 feet west of the east line, and completed April 20, 1922, to a depth of 3,114 feet. This was an offset well to the McCraw well. It came in with an initial production of 94 barrels. Another well known as Tatum No. 2 was drilled 320 feet east of the west line and 460 feet south of the north line of the property, which was completed on October 8, 1922, to a depth of 3,122 feet, and came in with an initial production of 47 barrels. Appellants own or control leases on the land on three sides of the Tatum property, and five wells were drilled by them shortly before Tatum well No. 1 was drilled, and two other wells were drilled shortly thereafter. All of these wells were drilled about six months to a year before Tatum No. 2, and were producing. Two of them were within 200 feet of the Tatum land, and the others more than 200 feet but less than 600 feet distant.

The...