Railroad Commission v. Shell Oil Co.

• Decision Date: 26 November 1947
• Docket Number: No. A-1255.,A-1255.
• Citation: 206 S.W.2d 235
• Parties: RAILROAD COMMISSION et al. v. SHELL OIL CO., Inc., et al.
• Court: Texas Supreme Court

206 S.W.2d 235

RAILROAD COMMISSION et al. v. SHELL OIL CO., Inc., et al.

No. A-1255.

Supreme Court of Texas.

November 26, 1947.

Rehearing Denied December 31, 1947.

Appeal from Court of Civil Appeals of Supreme Judicial District.

Suit by the Shell Oil Company, Inc., and others against the Railroad Commission of Texas and its members to enjoin the defendants from enforcing an order prohibiting the plaintiffs from producing either oil or gas from their wells until measures were taken to devote gas employed to produce oil to one or more of certain specified uses. From a judgment granting a temporary injunction until final determination of the suit, the defendants appeal.

Judgment affirmed.

Price Daniel, Atty. Gen., Fagan Dickson, Asst. Atty. Gen., James D. Smullen, former Asst. Atty Gen., and Elton M. Hyder, Jr., Asst. Atty. Gen., for appellants.

R. H. Whilden, of Houston, Dan Moody, J. B. Robertson, Hart & Brown, J. H. Hart, and Jas. P. Hart, all of Austin, Powell, Wirtz, Rauhut & Gideon, J. A. Rauhut, Walace Hawkins, and Raymond M. Myers, all of Dallas, Harris Toler, of Austin, J. M. Easterling, of Corpus Christi, Clarence Lihman, of Houston, Paul A. McDermott, of Fort Worth, J. W. Timmins and Martin A. Row, both of Dallas, Ed Lloyd, of Alice and L. L. Morrison, of San Antonio, for appellees.

SIMPSON, Justice.

This is a direct appeal from an order entered March 31, 1947, by the 126th District Court of Travis County restraining the Railroad Commission of Texas and its members, who are appellants here, from enforcing, until final determination of this suit, a Commission order dated March 17, 1947, effective April 1, 1947, by which the plaintiffs, appellees here, would have been prohibited from producing either oil or gas from their wells in the Seeligson Field in Southwest Texas until measures were taken to devote gas employed to produce the oil to one or more of the following uses: (a) Light or fuel; (b) efficient chemical manufacturing other than the manufacture of carbon black; (c) bona fide introduction of gas into oil or gas-bearing horizon in order to maintain or increase the rock pressure, or otherwise increase the ultimate recovery of oil or gas; (d) the extraction of natural gasoline when the residue gas is returned to the horizon from which it is produced.

Shell Oil Company, Incorporated, and a number of other Seeligson Field producers brought this suit alleging, among other things, that the order was illegal, unreasonable and discriminatory in that the Commission had no power to promulgate it; that the order contravened certain statutory provisions; that compliance with the order within the time set by the Commission was a physical impossibility; that certain of the field operators utilizing gas from their wells for fuel in drilling operations would enjoy a discriminatory advantage; that the Commission's finding that there is a present market for the gas is arbitrary in that it has no support in the evidence adduced before the Commission; and, as to certain of the complaining operators, that some of their leases were being kept in force by production only and might be jeopardized by the enforcement of the order. Issue was joined by appropriate pleadings filed by the Commission. Extensive findings of fact and conclusions of law were filed. The very first conclusion of law reached by the district court is that the Commission was without power under the statutes to promulgate and enforce the order in question.

But at the outset, before arguing the legality of the questioned order, the appellees insistently urge that this appeal should be dismissed because, it is claimed, (1) an election to appeal to the Court of Civil Appeals instead of directly here had been made by the appellants, and an appeal to that court having been perfected, its exclusive jurisdiction had attached; and (2) this direct appeal under Rule 499-a, Texas Rules of Civil Procedure, may not be maintained because it involves questions of fact and not of law only.

As to the first point in the motion, the trial court's judgment entered March 31, 1947, which was approved as to form by attorneys for appellants, recited notice of appeal to the Court of Civil Appeals for the Third Supreme Judicial District. Subsequently (April 18, 1947), the appellants filed a motion in the district court to correct the recital as to notice of appeal, alleging that by inadvertence and oversight the judgment showed notice of appeal to the Court of Civil Appeals. On the following day, the district court granted this motion and ordered that the "notice of appeal given to the Court of Civil Appeals be corrected and in lieu thereof notice of appeal be allowed to the Supreme Court of Texas."

Now it is obvious that two independent appeals might not simultaneously be pursued, one to the Court of Civil Appeals and another here. So, the appellees argue, notice of appeal to the Court of Civil Appeals having been given and no bond being required of the appellants (Art. 2276, R.S.), the appeal stood perfected instantly upon giving the notice, and no further action by the trial court could oust the jurisdiction of the Court of Civil Appeals. This position assumes the existence of a disputed fact, — a fact found by the trial court not to have existed, namely, the fact of giving notice of appeal to the Court of Civil Appeals. Necessarily, appellees contend that the trial court had no right to correct its records after notice of appeal had been given. To this we cannot assent. It was clearly within the province of the trial court, under the circumstances, to enter the order it did correcting its records so they would speak the truth. This in effect was the holding in Harris v. Stark, 101 Tex. 587, 590, 110 S.W. 737, 739, where a trial court had entered an order striking out certain bills of exception after an appeal in the cause had been perfected. The court there said: "It does not require the citation of authority to sustain the proposition that the district court had jurisdiction to correct the record of this case as made in that court, notwithstanding the appeal had been perfected and the transcript filed in the Court of Civil Appeals."

The appellees stress City of Houston v. Wynne, Tex.Civ.App., 279 S.W. 916, error refused, but that holding is not apposite. The burden of the holding, as it has bearing here, was to the effect that where a city, not being required to give bond, had perfected an appeal from an order granting a temporary injunction by the act of giving proper notice, its subsequent motion to dissolve the injunction did not waive or abandon the appeal. And the case of State v. Martin, Tex.Civ.App., 107 S.W.2d 1089, 1092, error dismissed, also cited by appellees, not only does not support their contention, but, to the contrary, is authority for the proposition that "if the district court committed error in reciting in its judgment that the defendants appeared in open court and excepted to the order, overruling their motion for new trial, and giving notice of appeal * * *, it had power to correct its mistake." What the trial court did in the case at bar was nothing more than to correct a mistake which we conclude it clearly had the right to do. In the light of that correction, the Court of Civil Appeals was never invested with exclusive, nor, for that matter, with any jurisdiction of this appeal. The first point in the motion to dismiss is overruled.

As to the second ground in the motion, namely, that the appeal involves a determination of contested issues of fact, reliance is placed by the appellees upon that provision in Rule 499-a which states that if a case brought here under the rule involves the determination of a contested issue of fact, the appeal will be dismissed. An appeal to this court from "any order of any trial court granting or denying an interlocutory or permanent injunction on the ground of the constitutionality or unconstitutionality of any statute of this State, or on the ground of the validity or invalidity of any administrative order issued by any State Board or Commismission under any statute of this State," has been allowed since January 1, 1944. A constitutional amendment adopted November 5, 1940, empowered the legislature to provide for direct appeals here in this class of cases. Texas Const., Art. V, § 3-b, Vernon's Ann.St.Const. By a statute effective January 1, 1944, these direct appeals were authorized, and the duty of prescribing rules governing them was delegated to this court. Acts 1943, 48th Leg., ch. 14, Vernon's Ann.Civ. St., Art. 1738a. Accordingly, Rule 499-a, prescribing the procedure on these appeals, was adopted. The provision adverted to in the first sentence of this paragraph was made in view of Section 3, Article V of the Constitution, which limits the appellate jurisdiction of this court to questions of law arising in cases of which the Courts of Civil Appeals have jurisdiction. It was not thought that by the amendment of 1940 (Art. V, § 3-b) the electorate had meant to enlarge the jurisdiction of the Supreme Court to include the decision of questions of fact, and although it was intended that direct appeals from certain trial court judgments might be entertained, nevertheless it was meant that the appellate jurisdiction of this court should continue to be limited to questions of law. To this end, Rule 499-a was framed to exclude from consideration here controverted issues of fact. But a decision of this cause must turn, it has been concluded, not upon issues of fact, but of law, presently to be discussed. It follows that the second ground in the motion to dismiss must also be overruled.

As has been noted, the first conclusion of law reached by the trial court was that no statutory authority at all existed for the entry of the questioned order. This conclusion goes to the very foundation of this controversy. An analysis of the statutes and of the Commission's authority under them is therefore not...