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Furie Petroleum Co., L.L.C. v. SWEPI, LP

Court of Appeals of Louisiana, Second Circuit

November 19, 2014

FURIE PETROLEUM COMPANY, L.L.C. AND SILVER SPUR ROYALTY COMPANY, L.L.C., Plaintiffs
v.
SWEPI, LP, ENCANA OIL & GAS (USA), INC., PRIDE OIL AND GAS PROPERTIES, INC., CLOYCE C. CLARK, JR. AND MARTHA CHAMBERLAIN CLARK, Defendants. CLOYCE C. CLARK, JR., et ux, Plaintiffs EUGENE COPELAND, et al, Defendants

Page 256

Appealed from the Forty-Second Judicial District Court for the Parish of DeSoto, Louisiana Trial Court Nos. 70733 and 70764. Honorable Robert E. Burgess, Judge.

JAMES D. " BUDDY" CALDWELL, Attorney General, RYAN M. SEIDEMANN, STEVEN B. " BEAUX" JONES, DANIEL D. HENRY, JR., Assistant Attorneys General, Counsel for Intervenor-Appellant, State of Louisiana.

BRADLEY MURCHISON KELLY & SHEA LLC, By: David R. Taggart, Leland G. Horton, Sarah A. Kirkpatrick, Counsel for Furie Petroleum Company, L.L.C. and Silver Spur Royalty Company, L.L.C.

KEVIN J. SEVERSON, Counsel for Succession of Eugene Copeland.

COOK, YANCEY, KING & GALLOWAY, By: Herschel E. Richard, Jr., John T. Kalmbach, Counsel for Encana Oil & Gas (USA) Inc., and Pride Oil & Gas Properties, Inc.

LISKOW & LEWIS, By: Lawrence P. Simon, Brian W. Capell, Nicohlas S. Wise, Jeffrey D. Lieberman, Counsel for SWEPI LP.

JAMES G. BETHARD, Counsel for Cloyce C. Clark, Jr. and Martha Chamberlain Clark.

D. SCOTT BROWN, M. AMY BURFORD McCARTNEY, Counsel for Briarwood Finance Co., LLC.

Before BROWN, STEWART and CARAWAY, JJ.

OPINION

Page 257

[49,462-CA La.App. 1 Cir. 1] CARAWAY, J.

The State of Louisiana (" State" ) appeals a ruling denying its right to intervene into these consolidated actions for declaratory judgment regarding the mineral ownership of a large tract of land. The State claims that a navigable waterway which it owns divides the tract into two parts. If established, this fact concerning the State's waterway would directly bear upon the underlying dispute over the maintenance of a mineral servitude over the large tract which is subject to the claim of prescription of nonuse. From our review of the pleadings and the positions of all sides, we find that the State's joinder is required for a complete adjudication of the controversy and the State's intervention should be allowed.

Facts and Procedural History

The procedural issue before the court arises from consolidated suits filed in 2009 concerning the validity of a 1967 mineral servitude burdening a 1,154-acre tract known as " Sunrise Place Plantation" in DeSoto Parish. The owners of the disputed mineral servitude are the Succession of Eugene Copeland, Karen Ann Ochsenbein Lanier, Annie Laurie Lanier Samuels, Harvey H. Samuels Jr., and Briarwood Finance Co., LLC, and their mineral lessees are Furie Oil & Gas, LLC, Silver Spur Royalty Co., LLC, and Jamma Energy, LLC (hereinafter the " Mineral Servitude Group" ). The surface owners of the property are Cloyce C. Clark Jr. and Martha Chamberlain Clark, and their mineral lessees are SWEPI LP and Encana Oil and Gas, Inc. (hereinafter the " Landowners Group" ). Originally, both sides sought declaratory judgments as to the validity of the disputed mineral servitude. The competing oil and gas leases were executed in 2008 and 2009. The [49,462-CA La.App. 1 Cir. 2] underlying dispute concerned prescription of nonuse and whether the servitude is still in effect. At issue was whether a well that had produced minimal quantities had sufficiently interrupted prescription.

The Mineral Servitude Group alleged that their rights were maintained by continuous production from the servitude from its creation in 1967 until July 9, 1998. They further alleged that a well was commenced on the property on June 30, 2008, and prescription of nonuse was again interrupted. That well is currently shut in.

By 2012, as the original parties approached trial, the Landowners Group revealed in a discovery disclosure that they would assert that Dolet Bayou, which crossed the 1,154-acre tract, was a navigable waterway. This new issue raised the possibility of ownership[1] of the State of a part of the 1,154-acre tract (the " waterway" ), and such ownership, if established, would divide the tract into two noncontiguous tracts of land. The Mineral Code requires that the creation of a single mineral servitude extend over a continuous body of land and a grant of rights over noncontiguous tracts creates multiple servitudes.

Page 258

La. R.S. 31:63 and 64. Thus, by raising the Dolet Bayou matter, the Landowners Group sought to compound the burden of the Mineral Servitude Group to show that the interruption of prescription had occurred on two ...


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