Sims v. Mechem
| Citation | 1963 NMSC 103,72 N.M. 186,382 P.2d 183 |
| Decision Date | 27 May 1963 |
| Docket Number | No. 7206,7206 |
| Parties | Amanda E. SIMS and George W. Sims, Petitioners-Appellants, v. Hon. Edwin L. MECHEM, Chairman, E. S. (Johnny) Walker, Member, A. L. Porter, Jr., Member, Secretary of the Oil Conservation Commission of the State of New Mexico, Olsen Oils, Inc., and Texas Pacific Coal and Oil Company, Successor to Olsen Oils, Inc., Respondents-Appellees. |
| Court | Supreme Court of New Mexico |
C. N. Morris, Foster Windham, Carlsbad, for appellants.
Richard S. Morris, James M. Durrett, Jr., Santa Fe, for N. M. Oil Conservation Commission.
Campbell & Russell, Roswell, Girand, Cowan & Reese, Hobbs, for Olsen Oils, Inc. and Texas and Pacific Coal & Oil Co.
This appeal involves Order No. R-1310 of the Oil Conservation Commission, the validity of which is challenged here on jurisdictional grounds.
Reviewing the record, in August, 1955, the commission issued Order No. R-677 pooling contiguous acreage in Section 25, Township 22 South, Range 37 East, N.M.P.M., Lea County, consisting of 40 acres in the southeast quarter of the northwest quarter and 120 acres in the northeast quarter of the southwest quarter, and south half of the southwest quarter of Section 25 as a 160-acre non-standard production unit and approved the drilling of a well. In September, 1957, the appellants, being owners of the mineral interests in the above-described production unit, and the then holder of the outstanding oil and gas leases thereon, entered into a communitization agreement pooling the leasehold estate for development. In January, 1958, a well was completed in the center of the 40 acres in the southeast quarter of the northwest quarter and its production attributed to the 160-acre production unit as provided in Order R-677 and the communitization agreement.
Subsequently, the successor in interest to the leasehold estate applied to the commission for a 160-acre non-standard gas proration unit consisting of the balance of the acreage in the northwest and southwest quarters of Section 25, on which it held leases or, in the alternative, for an order force-pooling the northwest quarter of Section 25 and the southwest quarter of Section 25 as two separate standard 160-acre production units. It was proposed in this application that if the two standard units were force-pooled that a second well would be drilled in the northeast quarter of the southwest quarter of the section.
After a hearing on the application, the commission found that the most efficient and orderly development of the acreage in the west half of Section 25 could be accomplished by force-pooling it into two standard units and, on December 17, 1958, entered Order No. R-1310 establishing the northwest quarter and the southwest quarter of Section 25 as two separate 160-acre standard production units, and rescinded its previous Order No. R-677. The production from each pooled unit was allocated to each tract in that unit in the same proportion that the acreage in said tract bore to the total acreage in the unit.
Pursuant to Order R-1310 the production from the first well was attributed to the acreage in the northwest quarter of Section 25 in which appellants held only a 1/15th royalty interest, and a second well was drilled in the northeast quarter of the southwest quarter and its production attributed to the acreage in the southwest quarter of which appellants were principal owners. The second well was a smaller producer than the first, resulting in diminished royalties to appellants.
Thereafter, in October, 1960, appellants filed an application before the commission for an order to vacate and set aside as void Order R-1310 and to reestablish the non-standard 160-acre production unit in conformity with Order R-677 and the communitization agreement. The basis of this application was the alleged concealment from the commission of the agreement between the parties, and it challenged the jurisdiction of the commission to enter Order R-1310 in violation of the agreement and of the rights of appellants. The denial of this application is the basis of appellants' petition for review.
On the hearing of the petition for review, the trial court denied appellants' petition and from such ruling they have appealed to this court for review.
Appellants have argued several points, but, in view of our disposition of this appeal, we need only concern ourselves with a determination of a basic jurisdictional question.
They now urge that the commission was without jurisdiction to enter Order R-1310 because...
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Tallman v. ABF (Arkansas Best Freight)
...... Aside from that correct proposition, Tallman's reliance on Heckathorn, and likewise on Sims v. Mechem, 72 N.M. 186, 382 P.2d 183 (1963), is misplaced. Both cases dealt with the issue of whether the court had the jurisdiction to decide the ......
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Harvey E. Yates Co. v. Cimarex Energy Co.
...Commission's powers is founded on the duty to prevent waste and to protect correlative rights. See id. § 70-2-11; Sims v. Mechem, 72 N.M. 186, 189, 382 P.2d 183, 185 (1963). Among other enumerated powers, the Oil Conservation Division has thePage 14authority "to require wells to be drilled,......
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El Paso Electric Co. v. N.M. Pub. Regulation Comm'n
...... P.2d 1263, 1266 (1993))); see also Rule 12–216(B) NMRA (stating that jurisdictional challenges may be raised for the first time on appeal); Sims v. Mechem, 72 N.M. 186, 188, 382 P.2d 183, 184 (1963) (same). We vacate and annul a Commission order as “unreasonable or unlawful” if the ......
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El Paso Electric Co. v. N.M. Pub. Regulation Comm'n
...... P.2d 1263, 1266 (1993))); see also Rule 12-216(B) NMRA (stating thatPage 4jurisdictional challenges may be raised for the first time on appeal); Sims v. Mechem, 72 N.M. 186, 188, 382 P.2d 183, 184 (1963) (same). We vacate and annul a Commission order as "unreasonable or unlawful" if the Commission ......