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W&T Offshore, L.L.C. v. Texas Brine Corp.

Court of Appeals of Louisiana, First Circuit

May 10, 2018

W&T OFFSHORE, L.L.C.
v.
TEXAS BRINE CORPORATION AND TEXAS BRINE COMPANY, L.L.C. TEXAS BRINE COMPANY, L.L.C.
v.
W&T OFFSHORE, L.L.C.

          On Appeal from the Seventeenth Judicial District Court In and for the Parish of Lafourche State of Louisiana No. 128742 c/w 128754 Div. "E" The Honorable F. Hugh LaRose, Judge Presiding

          Troy J. Charpentier Matthew B. Smith Baton Rouge, LA Attorneys for Defendants/Appellees Texas Brine Company, L.L.C. and Texas Brine Corporation

          W. Scott Keaty Joshua G. McDiarmid Baton Rouge, LA Attorneys for Amicus Curiae E.W. Brown, Jr. Properties F/ B/O LDSBB, LP, Charles E. Brown, Jr. Properties, LP, Carrie B. Henley Properties, LP, Robert S. Brown Properties, LP, Richard E. Brown, Michael S. Brown, Mary Robbins Brown -Jones, JCC Brown Properties Louisiana, LP, Donner Properties, LLC, Diana L. Chance, Agent for Donner, Estate of Carolyn B. Negley, Estate of Joan B. Winter and Odom Louisiana Properties, LLC

          Daniel Davillier Michael P. Schillage Charles F. Zimmer New Orleans, LA Attorneys for Plaintiff/Appellant W& T Offshore, L.L.C.

          M. Taylor Darden Andrew J. Brien New Orleans, LA Attorneys for Amicus Curiae Louisiana Landowners Association, Inc.

          BEFORE: HIGGINBOTHAM, HOLDRIDGE, AND PENZATO, JJ.

          HOLDRIDGE, J.

         Defendant/appellant, W&T Offshore, L.L.C., appeals a judgment of the trial court denying its claim for injunctive relief and damages against plaintiffs/appellees, Texas Brine Company, L.L.C., and Texas Brine Corporation.[1]

         FACTUAL AND PROCEDURAL HISTORY

         In 1979 Texas Brine[2] entered into a "Salt and Underground Storage Lease" (1979 lease) with W&T's predecessors in interest to utilize land in Lafourche Parish, identified as Estate of E.W. Brown, et al., located at Section 59, 64, and 71, T15S-R15E (the Brown property) for conducting salt mining operations.[3] The 1979 lease had an initial term often years and would last "so long thereafter as salt or salt brine [were] produced from the property[.]" The 1979 lease included a personal servitude of right of use, granting Texas Brine the authority to construct a pipeline on the leased premises, which provided, in pertinent part:

[Texas Brine] shall have the right to construct, operate and maintain a pipeline for the transportation of brine over and across additional property of Lessor comprising the North one-half Section ... of Section 64 and all of Section 59, Township 15 South, Range 15 East, Parish of La[f]ourche, Louisiana, on such portion of the property as designated by [Texas Brine] and as approved by Lessor, such approval not to be unreasonably withheld. (Emphasis added.)

         In 1980, Texas Brine constructed a fourteen inch in diameter and 6.7 mile long pipeline across Section 59 of the Brown property pursuant to the 1979 lease. If properly maintained, it was anticipated that the pipeline would be useful for approximately thirty years. In 1993, W&T attained a 23.66% undivided interest in the Brown property becoming the largest co-owner of the Brown property.

         In February 2014, Texas Brine filed an application for a permit from the U.S. Army Corps of Engineers for the construction of a second pipeline (replacement pipeline) on Section 59 of the Brown property to replace the fourteen inch brine pipeline. The replacement pipeline was to be constructed eight feet away from the original pipeline. W&T claimed it was not consulted before Texas Brine sought its permit from the U.S. Army Corps of Engineers.

         In November of 2014, Texas Brine began negotiations with W&T and the owners of the remaining 76.34% undivided interest of the Brown property to abandon the first pipeline and construct a replacement pipeline adjacent to the existing line. On August 7, 2015, Texas Brine filed a "Pipeline Right-of-Way" Agreement in the conveyance records of Lafourche Parish, showing that 76.34% of the owners of the Brown property granted Texas Brine "the right to lay, construct, maintain, replace, change the size of, move, remove and operate a single pipeline not to exceed eighteen inches ... diameter upon completion, and no more than twenty-four ... inches upon completion of a replacement pipeline ... for the transportation of brine and other fluids[.]" Texas Brine alleged that this agreement allowed it to construct a replacement pipeline adjacent to the original pipeline. W&T did not join the other 76.34% co-owners in agreeing to sign the "Pipeline Right-of-Way" Agreement.

         Texas Brine allegedly began construction of the replacement pipeline in August of 2015 and it was completed on November 7, 2015. The replacement pipeline was larger and entirely separate from the first pipeline, as it was eighteen inches in diameter, approximately seven miles long, and approximately eight feet away from the original pipeline.

          On November 12, 2015, counsel for W&T sent a letter to Texas Brine, informing it that W&T did not consent to the construction of the replacement pipeline located on the Brown property and that consent of all of the co-owners of the Brown property was required for the granting of a pipeline right of way on the property, and further requesting that Texas Brine "immediately cease and desist from the illegal construction activities on its property."

         In response, Texas Brine filed a Petition for Declaratory Judgment and Injunctive Relief on November 24, 2015, (docket number 128754) alleging that the 1979 lease granted it "the right to lay pipelines, and to build roads and other structures on the [Brown] Property as necessary to produce, save, take care of, treat, transport and own said salt and salt brine." Texas Brine stated that it was entitled to a declaratory judgment recognizing that it was entitled to replace the brine pipeline crossing the Brown property under the terms of the 1979 lease and the 2015 "Pipeline Right-of-Way" Agreement.

         On November 24, 2015, W&T filed a Petition for Temporary Restraining Order (TRO) and Preliminary and Permanent Injunctive relief (docket number 128742). The trial court granted W&T's request for TRO restraining, enjoining, and prohibiting Texas Brine from continuing the unauthorized pipeline construction on the Brown property.

         On December 1, 2015, Texas Brine filed a "Motion for Dissolution of Temporary Restraining Order and Damages" (docket number 128742). On December 3, 2015, W&T amended its petition to request a claim for injunctive relief, declaratory relief, and damages (docket number 128742). In its amended petition, W&T alleged that Texas Brine did not have the authority ...


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