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Inversiones Del Angel, S.A. v. Callon Petroleum Co.

as corrected: September 13, 1989.

INVERSIONES DEL ANGEL, S.A., ET AL., PLAINTIFFS-APPELLANTS,
v.
CALLON PETROLEUM COMPANY, DEFENDANT; LIVINGSTON PARISH POLICE JURY, DEFENDANT-APPELLEE



Appeal from the United States District Court for the Middle District of Louisiana. No. 84 76 A, John V. Parker, Judge.

Politz, Davis, and Duhe, Circuit Judges.

Author: Duhe

DUHE, Circuit Judge:

The appellants, Inversiones Del Angel, S.A. ("Inversiones") and Roberta E. Simes ("Simes"), appeal from the district court's rejection of their claim of ownership of one-third the minerals under the streets of Audubon Village Subdivision in Livingston Parish, Louisiana. The undisputed facts are:

In 1966 Melba Leroy Harvey, Melba Leroy Harvey, Jr. and Edwina Ford Anderson sold 320 acres of land, a portion of which now comprises Audubon Village Subdivision, to Reed Erikson. In the act of sale Melba Leroy Harvey and Melba Leroy Harvey, Jr. each reserved one-sixth of all minerals on the 320 acre tract. It is the ownership of this one-third mineral interest that is the subject of the dispute in this case.

In 1972 Erikson sold to Gauguin, Inc. that portion of the tract that now encompasses Audubon Village Subdivision. In 1973 Gauguin, Inc. recorded in the Livingston Parish conveyance records a copy of a plat of survey of Audubon Village Subdivision prepared by a registered land surveyor. The district court found that this recording and the plat substantially complied with La.Rev.Stat.Ann. 33:5051 (West 1989) and, consequently, constituted a statutory dedication to the State of Louisiana of the ownership of the streets and alleys shown on the recorded plat of Audubon Village Subdivision. See Pioneer Production Corp. v. Segraves, 340 So.2d 270 (La.1970). Inversiones and Simes do not appeal this finding. However, when Gauguin, Inc. effected the statutory dedication in 1973, the 1966 Harvey reservation of one-third the minerals was yet outstanding. Thus, the dedication of the streets did not then carry with it the mineral interest around which the dispute on appeal revolves. In 1976 the Harvey mineral interest prescribed.

In 1980, Gauguin, Inc. transferred the remaining property back to Erikson but reserved the mineral rights. In 1981, Gauguin, Inc. transferred to appellant Roberta E. Simes fifteen percent of its mineral interest in the property. This conveyance purported to include the interest that had been reserved by the Harveys in the 1966 sale to Erikson. In 1982 Gauguin, Inc. transferred to Inversiones Del Angel, S.A. all of its mineral interest in the property comprising Audubon Village Subdivision.

Callon Petroleum Company operated several unit wells on the property until 1985; since that time Amoco Production Company has operated the wells. Callon paid no royalties attributable to the disputed mineral rights, prompting Inversiones to initiate this action against Callon to recover royalties due. Callon deposited the disputed funds in the registry of the court and filed a counterclaim in the nature of an interpleader against Inversiones and impleaded the Parish of Livingston and Roberta E. Simes. All three claim an ownership interest in the mineral rights underlying the streets and alleys of Audubon Village.

The district court held that when the Harvey mineral reservation prescribed by 10 years' non-use in 1976, it reverted to the then owners of the land -- Gauguin, Inc., owner of the bulk of the property, and the Livingston Parish Police Jury, owner of the streets and alleys by virtue of the 1973 statutory dedication.

Inversiones and Simes base their appeal from this decision on La.Rev.Stats.Ann. (West 1989) 31:76, 31:149, and 31:150. Article 150 provides:

When land is acquired in the manner prescribed in Article 149, the prescription of nonuse shall continue to run against any then outstanding mineral rights subject to such prescription and shall accrue in favor of the owner from whom the land was acquired. Thereafter, the prescription of nonuse shall not run against such rights except as provided in Article 151.

Article 149, in pertinent part, reads:

When land is acquired from any person by the United States or the state of Louisiana, or any subdivision or agency of either, or any legal entity with expropriation authority by conventional deed, donation, or other contract or by condemnation or expropriation proceedings and by the act of acquisition, order, or judgment, a mineral right otherwise subject to the prescription of nonuse is reserved, the prescription of nonuse shall not run against the right so long as title to the land remains in the government, or any of its subdivisions or agencies, or any legal entity with expropriation authority.

The district court held that the phrase in Article 150 "acquired in the manner prescribed in Article 149" requires a twofold finding. First the land must have been acquired by a public body and, second, the act of acquisition must have contained a reservation of the mineral rights. Because the statutory dedication by Gauguin, Inc. contained no ...


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