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Peironnet v. Matador Res. Co.

Peironnet v. Matador Res. Co.

Supreme Court of Louisiana

June 28, 2013, Decided

NO. 2012-C-2292 Consolidated with NO. 2012-C-2377

Opinion

 [*795]  [Pg 1] KNOLL, JUSTICE1

This mineral rights case presents seminal issues concerning our civilian doctrine [*796]  of error and the reformation of written contracts for errors vitiating consent. It arises out of an extension of a three-year primary term oil and gas lease, covering 1805.34 acres in the southern part of Caddo Parish, to four and one-half years. Plaintiffs, Cynthia Fry Peironnet ("Peironnet"), Elizabeth Fry Franklin ("Franklin"), and Eleanor Baugnies de St. Marceaux ("Marceaux"), sued the lessee, Matador Resources Company ("Matador"), to rescind or reform the extension agreement making it applicable only to 168.95 nonproducing acres. Following several preliminary partial summary judgment rulings by the District Court, the jury found in favor of the lessee for the extension of the entire 1805.34 acres upon a showing of no mutual error. On summary judgment, the District Court then held the lease had been extended beyond the primary term  [**2] by continuous drilling operations. The Court of Appeal affirmed in part and reversed in part, reforming the lease to extend the term for the 168.95 acres only based on plaintiffs' unilateral error and judicially suspending the running of the lease for [Pg 2] 220 days following the rendition of judgment. We granted writs to address the correctness vel non of the Court of Appeal's ruling on error. Peironnet v. Matador Resources Co., 12-2292, 2377 (La. 1/11/13), 106 So.3d 541, 542. For the following reasons, we find plaintiffs are precluded from rescinding the agreement based on "inexcusable error." We also find no manifest error in the jury's factual conclusions on the issue of mutual error, nor do we find the District Court erred in its ruling on lease maintenance through continuous drilling operations. Accordingly, we reverse the judgment of the Court of Appeal and reinstate the District Court's judgment in its entirety.

FACTS

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144 So. 3d 791 *; 2013 La. LEXIS 1560 **; 2012-2292 (La. 06/28/13);; 2013 WL 3752474

CYNTHIA FRY PEIRONNET AND ELIZABETH FRY FRANKLIN VERSUS MATADOR RESOURCES COMPANY

Prior History:  [**1] ON WRIT OF CERTIORARI TO THE COURT OF APPEAL, SECOND CIRCUIT, PARISH OF CADDO.

Peironnet v. Matador Res. Co., 103 So. 3d 445, 2012 La. App. LEXIS 1014 (La.App. 2 Cir., 2012)

Disposition: REVERSED; JUDGMENT OF THE DISTRICT COURT REINSTATED.

CORE TERMS

Lease, parties, drilling, mutual, acres, primary term, reformation, acreage, Lessee, drilling operations, extension agreement, rights, leased premises, plaintiffs', unilateral, pooled, Sections, tracts, rescission, Lessor, inexcusable, obligations, negotiations, Revision, spudded, Conservation, horizontal, depths, Deep, mineral lease

Business & Corporate Compliance, Contract Formation, Acceptance, General Overview, Contracts Law, Offers, Defenses, Illegal Bargains, Public Policy Violations, Types of Contracts, Lease Agreements, Energy & Utilities Law, Leases & Licenses, Affirmative Defenses, Fraud & Misrepresentation, Evidence, Types of Evidence, Documentary Evidence, Parol Evidence, Contract Interpretation, Parol Evidence, Ambiguities & Mistakes, Coercion & Duress, Remedies, Rescission & Redhibition, Mutual Mistake, Reformation, Meeting of Minds, Unilateral Mistake, Civil Procedure, Trials, Jury Trials, Province of Court & Jury, Burdens of Proof, Clear & Convincing Proof, Judicial Officers, Judges, Discretionary Powers, Failure to Read Contract, Summary Judgment, Entitlement as Matter of Law, Genuine Disputes, Materiality of Facts, Appropriateness, Summary Judgment Review, Standards of Review, Appeals, Standards of Review, De Novo Review, Jury Instructions, Questions of Fact & Law, Clearly Erroneous Review, Oil, Gas & Mineral Interests