Nbi Services, Inc. v. Ward

• Decision Date: 22 November 2005
• Docket Number: No. 99,031.,99,031.
• Citation: 132 P.3d 619,2006 OK CIV APP 20
• Parties: NBI SERVICES, INC., Fleetosborn Gilcrease Unit, a body politic, and NOCO Investment Co., Inc., Plaintiffs/Appellants, v. Eugene WARD, Jack Longstreet c/o Lea Ward Trust Management Entities, Defendants/Appellees, and Edward F. Reed Trust, Margaret R. Kosek Trust, and Mary Elizabeth Reed Trust, Intervenors.
• Court: United States State Court of Criminal Appeals of Oklahoma. Court of Civil Appeals of Oklahoma

132 P.3d 619

2006 OK CIV APP 20

NBI SERVICES, INC., Fleetosborn Gilcrease Unit, a body politic, and NOCO Investment Co., Inc., Plaintiffs/Appellants, v. Eugene WARD, Jack Longstreet c/o Lea Ward Trust Management Entities, Defendants/Appellees, and Edward F. Reed Trust, Margaret R. Kosek Trust, and Mary Elizabeth Reed Trust, Intervenors.

No. 99,031.

Court of Civil Appeals of Oklahoma, Division No. 2.

November 22, 2005.

Released for Publication by Order of the Court of Civil Appeals of Oklahoma, Division No. 1.

COPYRIGHT MATERIAL OMITTED

Appeal from the District Court of Seminole County, Oklahoma; Honorable Martha K. Kilgore, Trial Judge.

AFFIRMED.

Jack Mattingly, Sr., The Mattingly Law Firm, P.C., Seminole, OK, for Plaintiffs/Appellants.

Larry Jay McMains, Johnston & McMains, Seminole, OK, for Defendants/Appellees.

Opinion by JERRY L. GOODMAN, Judge (sitting by designation).

¶ 1 Plaintiffs, NOCO Investment Co., Inc. (NOCO), NBI Services Inc. (NBI), and the Fleet Osborn Gilcrease Unit (Unit), appeal from the trial court's orders entering judgment on a jury verdict finding Defendants Eugene Ward and Jack Longstreet c/o Lea Ward Trust Management Entities are entitled to more than $90,000.00 in damages related to Plaintiffs' use of Defendants' land, and awarding Defendants an attorney's fee. Based on our review of the record, the parties' briefs, and the applicable law, we affirm the decision of the trial court.

FACTS

¶ 2 This is the second time this action has been before us on appeal. In appeal No. 98,960, we affirmed the trial court's denial of Plaintiffs' request for a permanent injunction that would have kept Defendants from blocking Plaintiffs' effort to build a water injection plant on Defendants' property without paying the surface owners and tenant. The Oklahoma Supreme Court denied Plaintiffs' petition for certiorari seeking review on the merits of that action.¹

¶ 3 NOCO is the owner of a .78301498 working interest in the Unit, a secondary recovery, water injection operation of which NBI is the current Unit operator. The Unit was created by a Plan of Unitization (Unit Plan), pursuant to 52 O.S.1971, §§ 287.1 through 287.15, unitizing management, operation, and further development of the Gilcrease Formation underlying Sections 25 and 26 in Seminole County. Defendant Eugene Ward (Ward) is a surface tenant and the Edward F. Reed Trust, Margaret R. Kosek Trust, and Mary Elizabeth Reed Trust (Reed Trusts) are surface owners of the Seminole County property where Plaintiffs' water injection facilities are located.² Ward is also the surface owner of a tract adjacent to the Reed Trust property that also was affected by Unit operations.

¶ 4 Plaintiffs initiated this action in September of 2001, seeking a temporary restraining order and permanent injunction prohibiting Defendants from interfering with Plaintiffs' asserted right to reasonable surface use under the Unit Plan. Defendants objected and counterclaimed. Ward sued for breach of contract, trespass, negligence, and nuisance; the Reed Trusts asserted the same theories of recovery and also asserted a conversion claim. All Defendants asserted Plaintiffs had contracted with them to pay $1.00 per foot for lines laid on their property and had breached the contract; and that Plaintiffs had trespassed by using unauthorized portions of the surface of Defendants' property. Defendants also sought actual and punitive damages under theories of negligence and nuisance, alleging Plaintiffs had not buried pipelines below plow depth, had failed to pick up oilfield debris, and had polluted Defendants' property by allowing saltwater to run over it.

¶ 5 The trial court initially entered a temporary restraining order against Defendants, and Plaintiffs constructed water injection facilities on the property. The trial court then bifurcated the case and tried the issue of a permanent injunction prior to trial on Defendants' counterclaims for surface damages. As noted above, the trial court ultimately denied Plaintiffs' request for a permanent injunction and dissolved the temporary restraining order.³

¶ 6 Trial on Defendants' counterclaims occurred in February of 2003. The jury found in favor of Defendants on their breach of contract, trespass, negligence, and nuisance claims, but in favor of Plaintiffs on Reed Trusts' claim of conversion. It awarded Ward $24,178.00 and Reed Trusts $67,435.00 in actual damages, but awarded no punitive damages to either party. Plaintiffs appeal, asserting allegations of error that, in essence, challenge the trial court's (1) denial of Plaintiffs' challenge for cause as to one member of the jury; (2) subject matter jurisdiction; (3) admission of certain evidence; (4) failure to sustain NOCO's in-trial demurrer to the evidence and motion to dismiss claiming lack of legal liability of a non-operator working interest owner; and (5) attorney's fee award to Defendants.

STANDARD OF REVIEW

¶ 7 Trial court decisions going to the manner and conduct of a trial — such as whether to grant or deny a challenge for cause of a prospective juror, or whether to admit or exclude evidence — are subject to an "abuse of discretion" standard of review on appeal. See e.g., Kansas City So. Ry. Co. v. Norwood, 1961 OK 238, ¶ 0, 367 P.2d 722, 724 (syllabus by the court)("large discretion is vested in the trial court in determining competency and qualifications of jurors," such that trial court's action should not be disturbed unless an abuse of discretion is "clearly apparent"); Jamison v. Oklahoma Power & Water Co., 1939 OK 163, ¶ 0, 90 P.2d 419, 419 (syllabus by the court)(trial court's ruling on challenge to juror for bias and prejudice "will not be reversed unless it appears that the court has abused its discretion to such an extent as to work injustice . . ."); Myers v. Missouri Pacific R. Co., 2002 OK 60, ¶ 36, 52 P.3d 1014, 1032 ("[a] judgment will not be reversed based on a trial judge's ruling to admit or exclude evidence absent a clear abuse of discretion").

¶ 8 Also within the realm of trial court discretion are issues concerning awards of an attorney's fee. Thus, such awards also are subject to the abuse of discretion standard of review on appeal. See Tibbetts v. Sight 'n Sound Appliance Centers, Inc., 2003 OK 72, ¶ 3, 77 P.3d 1042, 1046. "As a general matter, an abuse of discretion review standard includes appellate examination of both fact and law issues . . . abuse occurs when the ruling being reviewed is based on an erroneous legal conclusion or there is no rational basis in the evidence for the decision." Id. See also Christian v. Gray, 2003 OK 10, ¶ 43, 65 P.3d 591, 608; Fent v. Oklahoma Natural Gas, Co., 2001 OK 35, ¶ 12, 27 P.3d 477, 481.

¶ 9 On the other hand, matters presenting issues of law are reviewed de novo by the appellate court. Neil Acquisition, L.L.C. v. Wingrod Inv. Corp. 1996 OK 125 n. 1, 932 P.2d 1100, 1103, n. 1. Such issues include those which claim error in the denial of a demurrer to evidence, and those challenging the subject matter jurisdiction of the court. See Ware Rubber Co. v. Sewell, 1939 OK 279, ¶ 6, 91 P.2d 667, 668 (demurrer to evidence); Tulsa Order of Police Lodge No. 93 ex rel. Tedrick v. City of Tulsa, 2001 OK CIV APP 153, ¶ 12, 39 P.3d 152, 155 (subject matter jurisdiction). Review "de novo" means that no deference is accorded the trial court decision: "An appellate court claims for itself plenary, independent and non-deferential authority to re-examine a trial court's legal rulings." Neil Acquisition, 1996 OK 125 n. 1, 932 P.2d at 1103, n. 1. The case at bar includes issues encompassing both the abuse of discretion and de novo review standards.

ANALYSIS

Alleged Error in Jury Selection

¶ 10 Plaintiffs first assert error in the trial court's denial of their challenge for cause of a prospective juror during voir dire. The juror, Ms. F, was called as a potential panel member after Plaintiffs had exhausted all three peremptory challenges. Relevant parts of the exchange between the trial court, counsel, and Ms. F, are set forth in part below:

THE COURT: Okay. Do you know of any reason right now that you would not be qualified to be a juror in this case?

[Ms. F]: Well, my experience with the oil fields. Everywhere they leave, there's junk.

THE COURT: So you've had some experience with that?

[Ms. F]: Yes.

THE COURT: Do you own property where there's — where you've had some work done?

[Ms. F]: Yes.

THE COURT: Okay, and do you own that property now?

[Ms. F]: Yes.

THE COURT: And when was the last time you had any problem with an oil company?

[Ms. F]: They're still — it don't do any good to do anything. Ours is still trash, and pipe, and oil, and barrels, and got three oil wells on it, and it's all a mess.

THE COURT: I'm sure the attorneys are going to want to ask you some more questions about that in just a minute. . . .

[Other Juror]: . . . We have 80 acres and we have a couple [of oil companies] that goes across our land . . . . A pipeline, and the electric posts, and a well that's on the other side of our land.

[Plaintiff counsel]: Has that caused any disputes?

[Other Juror]: No. . . .

. . .

[Plaintiff counsel]: [Ms. F], you sound a little upset. . . . And some of our earlier questions where you know some cases jurors don't make the best jurors on, could this be one of them?

[Ms. F]: This would be.

[Plaintiff counsel]: And you think in all good conscious [sic] and honesty it would just be better you be dismissed from this case?

[Ms. F]: Right.

. . .

[Plaintiff counsel]: Do we make our challenge now or later, Judge?

[Defense counsel]: I would like to inquire.

. . .

[Defense counsel]: . . . [Ms. F] . . . I understand that you had some bad experience with oil companies. But you understand that there is a right way to do oil operations and there's a wrong way to do it?

[Ms. F]: Yes.

[Defense counsel]: Some do it the wrong way, some do it the right way. If evidence is put on in this case,...