United States v. Norvell

• Citation: 298 F. 281
• Decision Date: 01 April 1924
• Docket Number: 4210,4215.
• Parties: UNITED STATES v. NORVELL et al. SAME v. McMULLEN et al.
• Court: United States Courts of Appeals. United States Court of Appeals (5th Circuit)

298 F. 281

UNITED STATES v. NORVELL et al.

SAME v. McMULLEN et al.

Nos. 4210, 4215.

United States Court of Appeals, Fifth Circuit.

April 1, 1924

Robert A. Hunter, Special Asst. Atty. Gen., for the United States.

S. L Herold, of Shreveport, La. (D. Edward Greer, of Houston Tex., and Thigpen, Herold, Lee & Cousin, of Shreveport, La on the brief), for appellees.

Before WALKER and BRYAN, Circuit Judges, and CALL, District Judge.

CALL District Judge.

The appeals in these two cases were sued out by the United States from decrees of the District Court of the Western District of Louisiana, denying its right to recover from the defendants the net value of oils extracted by them from tracts of land since January 1, 1918. On August 4, 1919, decrees were entered by the District Court of the Western District of Louisiana, recognizing plaintiff's ownership of the lands and enjoining the defendants from trespassing thereon condemned the defendants for the royalties paid out of the oil, and made provision for the appointment of a receiver to take charge of the property and continue the operations of extracting the oil. An accounting was had up to January 1, 1918, and the amounts carried into the decrees.

The records show that the wells were drilled and oil extracted before and since the suits were brought. In the Norvell et al. Case it shows that the net profit on oil extracted since January 1, 1918, was $2,718.59, and in the McMullen et al. Case it was $5,653.55. The trial court rejected the claims of the United States for the net value of the oil produced since January 1, 1918, the date at which the accounting was had in the decree of August 4, 1919, for the reason that the entire transactions of the defendants were conducted at a loss. The losses prior to January 1, 1918, had been allowed to the defendants in the decree of August 4, 1919. Mason v United States (decided by the Supreme Court of the United States) 260 U.S. 545, 43 Sup.Ct. 200, 67 L.Ed. 396, affirmed the decrees of the District Court January 2, 1923.

The issues in these cases are a matter of law, the facts being admitted. The decrees of August 4, 1919, provided that defendants should account for the oil extracted from the lands subsequent to January 1, 1918. In each of the decrees it is provided that said defendants be and they are hereby ordered, directed, and required to make full, true, and accurate accounting to plaintiff of all oil extracted from said land since January 1, 1918, and to pay to plaintiff the value thereof as ascertained by said accounting, and that all of plaintiff's rights to recover the oil produced from said lands by defendants since January 1, 1918, be reserved.

The question raised by the assignments of error may be succinctly stated as follows: Can the defendants be allowed to set off losses and expenses incurred prior to January 1, 1918 against the value of the oil extracted since that day, in accounting for the value of the oil, under the reservation in the decrees? These decrees were entered August 4, 1919. Appeals were taken to the Circuit Court of Appeals, and supersedeas given; the...