Texas Gas Exploration Corp. v. Lafourche Realty Co.
| Decision Date | 11 January 2012 |
| Docket Number | Nos. 2011 CA 0520,2011 CA 0523.,2011 CA 0522,2011 CA 0521,s. 2011 CA 0520 |
| Parties | TEXAS GAS EXPLORATION CORPORATION v. LAFOURCHE REALTY COMPANY, INC., et al.CSX Oil and Gas Corporation v. Lafourche Realty Company, Inc., et al.Total Minatome Corporation v. Lafourche Realty Company, Inc., et al.Lafourche Realty Company, Inc. v. Total Minatome Corporation, et al. |
| Court | Court of Appeal of Louisiana — District of US |
OPINION TEXT STARTS HERE
Jefferson D. Stewart, Charles A. Cerise, Jr., Raymond P. Ward, Shelly S. Howat, New Orleans, LA, David M. Richard, Thibodaux, LA, for Appellant/Plaintiff–in–Reconvention, Lafourche Realty Co., Inc.
John M. Wilson, Cheryl M. Kornick, Kelly B. Becker, Matthew D. Simone, New Orleans, LA, for Appellee/Defendant–in–Reconvention, Energen Resources Corp., successor-in-interest by merger and name change to Total Minatome Corp., successor-in-interest to CSX Oil and Gas Corp., successor-in-interest to Texas Gas Exploration Corp.
William R. Pitts, Metairie, LA, for Appellees/Defendants–in–Reconvention, Ellen Lucy McHugh, as Trustee of the Ellen Lucy McHugh Trust, et al.Gary A. Lee, John M. Futrell, Richard M. Perles, David L. Hoskins, New Orleans, LA, for Appellees/Defendants–in–Reconvention, the Harrison Lessors.P. Albert Bienvenu, Jr., New Orleans, LA, for Appellees/Defendants–in–Reconvention, Carolyn Atkinson Bienvenu as Executrix of the Succession of Paul Albert Bienvenu, and the Succession heirs Carolyn Bienvenu, P. Albert Bienvenu, Jr., Carolyn Bienvenu Richardson McClave, and Richard A. Bienvenu.
Before CARTER, C.J., PARRO, and HIGGINBOTHAM, JJ.
[1 Cir. 3] The merits of this appeal in these consolidated cases relate to the interpretation of an oil royalty payment clause in an oil and gas lease. After rendering a partial summary judgment interpreting the clause, the district court signed an order of appeal and simultaneously issued a per curiam explaining why the district court declined to certify the judgment as final for purposes of an immediate appeal. After the record was lodged in this court, we issued, ex proprio motu, a rule for the parties to show cause by briefs why the instant appeal should not be dismissed as having been taken from a partial summary judgment without the proper designation of finality as required by La. C.C.P. art. 1915(B). For the following reasons, we do not reach the merits of the appeal, because we find that this court lacks appellate jurisdiction to review the partial summary judgment.
This litigation commenced as a concursus proceeding twenty-seven years ago, on August 24, 1984. Texas Gas Exploration Corporation (“Texas Gas”) named Lafourche Realty Company (“Lafourche Realty”) and the State Mineral Board of the State of Louisiana (“the State”) as defendants. The concursus proceeding involved multiple oil, gas, and mineral leases dating back to 1974, and the disputed ownership of land units in the Lake Enfermer Field (“the field”) in Lafourche Parish, Louisiana. A total of fourteen different lawsuits have been filed over the years since the litigation began. Some of the lawsuits concerned the State and Lafourche Realty, but some involved other landowners. All fourteen lawsuits were eventually transferred and consolidated for trial; however, only four of the consolidated cases are at issue at this time (hereafter referred to as “the consolidated cases”).1 By 1994, the ownership disputes were resolved in favor of Lafourche Realty, and the record reflects that some of the lawsuits were dismissed. [1 Cir. 4] Adding to the complexity of the procedural history, Texas Gas merged and changed the company's name four times, eventually becoming Energen Resources Corporation (“Energen”).
As the successor-in-interest lessee, Energen was the designated operator for oil production under the Lafourche Realty leases, and was the appropriate party to pay and otherwise account for the royalties attributable to the leases for oil production from the field.2 In April 1996, Lafourche Realty filed first supplemental reconventional demands in three of the cases and instituted suit against successor-in-interest, Energen, in the consolidated cases. Lafourche Realty sets forth virtually the same allegations in all of its demands, seeking the right to additional economic benefits allegedly obtained by the lessee, Energen, from the marketing of the oil subject to the royalty interest. Lafourche Realty also named nine additional defendants-in-reconvention in each case, alleging that all of the defendants were lessees or working interest owners under one or more of the leases.
Lafourche Realty alleged that the lessees had an obligation to fulfill their obligations in good faith and to properly account for and pay royalties upon all of the economic benefits derived from the leases. Lafourche Realty further alleged that it had not been paid all of the royalties due and owing to it under the leases and pursuant to the mineral code, because of a marketing scheme whereby Energen had allegedly delivered crude oil produced from the field to a transporter company that then transported the oil from the field and redelivered it to Energen or Energen's designee. Lafourche Realty alleges that, at that point, the crude oil was refined for the sole economic benefit of Energen or sold by Energen to third parties, resulting in a greater economic benefit to Energen than the total price paid by the transporter in the field, which was the price upon which the oil royalties [1 Cir. 5] were calculated and paid to Lafourche Realty. Lafourche Realty further averred that Energen's failure to pay royalties on the greater economic benefit through the marketing schemes was willful, without reasonable cause, and/or fraudulent, all in violation of the terms of the leases, La. R.S. 31:122 of the mineral code, and the laws of Louisiana.
Lafourche Realty requested that the district court find all of the defendants in default of their obligations to pay royalties and in breach of their obligations to operate the leased properties for the mutual benefit of the lessees and Lafourche Realty. Lafourche Realty further requested that the district court order the defendants to render a full and complete accounting of the amount of oil produced, pay royalties calculated on the basis of all of the economic benefits attributed to the leases, pay damages plus attorney's fees and costs, and order cancellation and rescission of the leases.
On May 27, 2010, fourteen years after Lafourche Realty asserted its claims regarding fraud and underpayment of royalties against Energen and the other co-defendants, Energen filed a motion for summary judgment, claiming that Lafourche Realty was precluded as a matter of law from the relief it sought in the litigation. Energen relied on the specific clause in the mineral leases that addressed the payment of oil royalties: “Lessee [Energen] may sell Lessor's [Lafourche Realty's] oil at the best market price obtainable and pay Lessor [Lafourche Realty] the price received f.o.b. the leased property.”
In Energen's memorandum in support of its motion for summary judgment, Energen stated that it was “seeking dismissal of all claims by Lafourche Realty ... against Energen,” because Lafourche Realty's claims contradicted the plain and unambiguous language of the leases. Energen maintained that In support of its motion, Energen filed deposition excerpts and an affidavit, along with authenticated copies of the leases and copies [1 Cir. 6] of Energen's contracts with its transporter. In opposition to Energen's motion for summary judgment, Lafourche Realty offered affidavits and expert reports, all relating to Energen's supposed efforts to hide the allegedly fraudulent marketing schemes from its royalty owners.
After a hearing, the district court granted Energen's motion for summary judgment on November 30, 2010. The judgment dismissed Lafourche Realty's cause of action, pursuant to La. R.S. 31:140, “asserting failure of the mineral lessee to make proper payment of royalties.” In written reasons for judgment, the district court emphasized that the summary judgment dismissed only one of Lafourche Realty's causes of action. The district court stated that Lafourche Realty had asserted two causes of action in its first supplemental reconventional demand: (1) “a cause of action for failure of the lessee to make proper payment of royalties under [La. R.S.] 31:140,” and (2) “a cause of action alleging fraud under [La. C.C. art.] 1953 in violation of the mineral lessee's obligation to act as a reasonably prudent operator under [La. R.S.] 31:122 to market the crude oil for the mutual benefit of the mineral lessor and mineral lessee.” The district court then concluded in written reasons that Energen's motion for summary judgment did not pray for a judgment dismissing Lafourche Realty's second cause of action asserting Energen's alleged fraud. The partial summary judgment signed by the district court was silent regarding the second cause of action, and the judgment did not address the claims of any other lessees that had been named in the consolidated cases. Additionally, the judgment did not specify which of the consolidated cases was affected by the partial summary judgment.
On January 7, 2011, Lafourche Realty filed a motion for appeal or, alternatively, motion to certify the judgment as final for appeal. Energen opposed the motion, and the district court denied Lafourche Realty's motion for appeal as [1 Cir. 7] premature on January 28, 2011.3 Lafourche Realty filed a second motion for devolutive appeal, which was granted by the trial court on February 3, 2011. In opposition to the motion to certify the partial summary judgment as final, Energen argued that the November 30, 2010 judgment “did not address the [identical] claims of...
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