Shell Oil Company v. Prestidge, 15365.
| Decision Date | 04 December 1957 |
| Docket Number | No. 15365.,15365. |
| Citation | 249 F.2d 413 |
| Parties | SHELL OIL COMPANY, a Corporation, Appellant, v. Lanus Wayne PRESTIDGE, Appellee. |
| Court | U.S. Court of Appeals — Ninth Circuit |
Claude Marcus, Blaine F. Evans, Boise, Idaho, Grant C. Aadnesen, Salt Lake City, Utah, for appellant.
Glenn A. Coughlan, Boise, Idaho, Milton E. Zener, Pocatello, Idaho, for appellee.
Before HEALY and FEE, Circuit Judges, and MURRAY, District Judge.
Between 7:00 and 7:30 o'clock on the morning of June 1, 1954, Lanus Wayne Prestidge, appellee herein, and a companion, visited the site where Rocky Mountain Oil Corporation was drilling for oil near Montpelier in Bear Lake County, Idaho, for the purpose of seeking employment. At the time they arrived at the site, the day's work had not commenced and Clarence S. Robinson, the Drilling Superintendent on the operation, whom they wanted to see concerning employment, was not present. While waiting for Mr. Robinson, Prestidge and his companion joined the drilling crew around a fire which the crew had started for the purpose of warming themselves before commencing work. While Prestidge and his friend were waiting around the fire for Mr. Robinson to put in his appearance, one of the drilling crew poured diesel oil on the fire to make it burn better. This resulted in fire being splashed on Prestidge, burning him.
As a result of his injuries from being burned, Prestidge instituted an action against Rocky Mountain Oil Corporation, Shell Oil Company and Stony Point Development, Inc. Stony Point Development Company was subsequently dismissed from the action by stipulation, and the case continued against Rocky Mountain and Shell.
In the first trial of the case, as in the second trial, which is on review here, it was apparently plaintiff's theory that Shell Oil Company and Rocky Mountain Oil Corporation were joint venturers engaged in the search for oil in the area concerned, or that Rocky Mountain was the agent of Shell in drilling the well where the injury occurred. Shell's position was that Rocky Mountain was an independent contractor, for whose negligence Shell was not responsible, and at the close of plaintiff's case, Shell moved for a directed verdict in its favor on that basis. The motion for directed verdict was denied, and after being instructed on the law of joint venture, principal and agent and independent contractor, the jury returned a verdict in favor of plaintiff and against Shell and Rocky Mountain jointly in the sum of $19,905.85, and judgment for plaintiff was accordingly entered.
Thereafter, upon Shell's Motion for Judgment in Accordance with its Motion for Directed Verdict, the District Court vacated the judgment for plaintiff and entered judgment for defendant Shell Oil Company upon the basis that it had erred in submitting to the jury the question of the relationship existing between Shell and Rocky Mountain, and that as a matter of law, the written contract between them established the relationship of Rocky Mountain to Shell to be that of independent contractor, for whose negligence Shell was not responsible.
Plaintiff thereupon filed a motion for new trial, supported by affidavits, on the ground, among others, of newly discovered evidence. The motion was granted and upon the second trial the jury returned a verdict in favor of plaintiff for $10,000.00, judgment was entered thereon, and from that judgment Shell appeals.
The principal ground urged for reversal is that the District Court erred in the second trial in again submitting to the jury the question as to the relationship which existed between Rocky Mountain and Shell. It is the position of Shell that the written agreement, under which Rocky Mountain was drilling the well where the injury to plaintiff occurred, conclusively establishes Rocky Mountain as an independent contractor of Shell as a matter of law, and that the District Court should have so construed the written agreement and dismissed the action as against Shell, or ordered a directed verdict in its favor, upon the ground that it could not be held responsible for the negligence of its independent contractor. No issue is raised on this appeal as to the negligence of Rocky Mountain.
A brief outline of the background against which the accident occurred is necessary. It appears that Shell Oil Company owned oil and gas leases on a large area of land in Bear Lake County, Idaho, on what is known as the Give Out Structure. The drilling site, where plaintiff was burned, is described as Lot 2, Section 30, Township 12 South, Range 46 East, Boise Meridian. This parcel of land is government land upon which an oil and gas lease was originally granted by the government to one Ragner Barhaug on February 1, 1949. Barhaug assigned his lease to Shell. On December 26, 1952, the agreement with which we are here concerned was entered into between Shell Oil Company and one Wheeler and Gray, a partnership, and thereafter Wheeler and Gray, with the consent of Shell, assigned the agreement to Rocky Mountain Oil Corporation by an instrument dated March 6, 1953, entitled "Assignment". It appears that on February 1, 1954, the original government lease to Barhaug expired by reason of non-payment of rental, and thereafter, the same land was leased by the government, on April 29, 1954, to one G. W. Anderson, who assigned his lease to Rocky Mountain Oil Corporation. On June 11, 1954, 10 days after the accident here involved, Rocky Mountain agreed in writing that the lease it had obtained from G. W. Anderson was subject to the agreement that it, Rocky Mountain, had with Shell.
Under the terms of the agreement between Shell Oil Company and Wheeler and Gray, dated December 26, 1952, which was assigned to Rocky Mountain, and which will be hereinafter referred to as the agreement of December 26, 1952, Rocky Mountain was to drill a test well near the center of Lot 2, Section 30, Township 12 South, Range 46 East, Boise Meridian, on or before June 26, 1953. In consideration of such drilling, Shell agreed to assign the lease on said land to Rocky Mountain, along with other leases it had on the Give Out Structure, in a checkerboard fashion, that is, the leases to be assigned covered lands that were intermingled with lands, the leases of which Shell retained, in a checkerboard fashion. In all of such assignments Shell was to retain a royalty interest, and was to have the right to acquire all of the production encountered. Shell was to furnish all the title data on said lands and was to do all the geological work. Additionally, Shell was to contribute to the cost of drilling dry holes to the extent of $8,250. Shell was to be provided copies of all logs and other drilling data.
To warrant reversal of this cause on the ground that Shell cannot be held liable...
To continue reading
Request your trial
-
Trans-Tec Asia v. M/V Harmony Container
...control or management of the venture; and (5) an agreement to share the profits or losses of the venture. In Shell Oil Co. v. Prestidge, 249 F.2d 413, 415-16 (9th Cir.1957), the Ninth Circuit, applying common law principles, identified the following factors as essential to the existence of ......
-
Blocker Exploration Co. v. Frontier Exploration, Inc., s. 85SC300
...Co., 616 S.W.2d 184 (Tex.1981); Mud Control Laboratories v. Covey, 2 Utah 2d 85, 269 P.2d 854 (1954); see also Shell Oil Co. v. Prestridge, 249 F.2d 413, 417 (9th Cir.1957) (although there was some evidence that Shell had exercised actual control over the drilling, "under the provisions of ......
-
House v. Mine Safety Appliances Co.
...need not be shared equally between members of a joint venture, but can be delegated to one member of the group. Shell Oil Company v. Prestidge, 249 F.2d 413 (9th Cir. 1957). Thus, the limited control retained by third party defendants here does not preclude classification of these arrangeme......
-
Simmons v. Ware
...required elements are missing, or when there is conflicting evidence as to one or more of the elements. Indeed, Shell Oil Co. v. Prestidge (9th Cir.1957) 249 F.2d 413, 415–416, a case relied upon by Simmons identifies the elements as all being essential to establishing a joint venture: "A j......
-
CHAPTER 1 LIABILITIES OF NONOPERATING INTEREST OWNERS
...v. Humble Oil & Refining Co., 252 S.W. 1083 (Tex. Civ. App. 1923); Shepherd, supra note 1, at 238. [13] See Shell Oil Co. v. Prestidge, 249 F.2d 413 (9th Cir. 1957); Mayfield v. Key, 260 S.W. 926 (Tex. Civ. App. 1924); Sparks v. Midland Supply Co., 339 P.2d 1056 (Okla. 1959); Robinson Petro......
-
CHAPTER 7 LIABILITIES OF NONOPERATING OIL AND GAS INTEREST OWNERS
...v. Humble Oil & Refining Co., 252 S.W. 1083 (Tex. Civ. App. 1923); Shepherd, supra note 1, at 238. [13] See Shell Oil Co. v. Prestidge, 249 F.2d 413 (9th Cir. 1957); Mayfield v. Key, 260 S.W. 926 (Tex. Civ. App. 1924); Sparks v. Midland Supply Co., 339 P.2d 1056 (Okla. 1959); Robinson Petro......
-
CHAPTER 11 MINING AGREEMENT PROVISIONS FOR PREVENTING OR MINIMIZING LITIGATION
...(10th Cir. 1960) (oil and gas joint operating contract constituted a "joint adventure" between the parties); Shell Oil Co. v. Prestridge, 249 F.2d 413 (9th Cir. 1957) (relationship between drilling contractor and oil company held to constitute joint adventure). [54] See generally, Boigon & ......
-
CHAPTER 6 OPERATIONAL AGREEMENTS IN THE SHADOW OF BANKRUPTCY--WHAT CAN BE DONE TO STRUCTURE AGREEMENTS IN ORDER TO MINIMIZE THE PROBLEMS OF A PARTY THAT LATER GOES BANKRUPT
...Cir. July 12, 1985). A farmout arrangement was also held to result in a joint venture under Idaho law in Shell Oil Company v. Prestidge, 249 F.2d 413 (9th Cir. 1957). [32] Ayco Development Corp. v. G.E.T. Service Co., 616 S.W.2d 184 (Tex. 1981); U.S. Trucklines v. Texaco, Inc., 337 S.W.2d 4......