Lexis Nexis - Case Brief

Not a Lexis Advance subscriber? Try it out for free.

Law School Case Brief

Barnard v. Monongahela Nat. Gas Co. - 216 Pa. 362, 65 A. 801 (1907)

Rule:

It is the right of every landowner to drill a well on his own land at whatever spot he may see fit.

A lessee has the same rights in regard to the locating of its wells as the landowner would have if doing the operating, but the lessee cannot take advantage of the fact that he has leases on adjoining farms so as to fraudulently deprive either of his lessors of his royalty or annual gas rental. 

Facts:

Plaintiffs Daniel and Elizabeth Barnard were the owners in fee of a 66-acre tract of land. James B. Barnard owned the tract of land adjoining the plaintiffs' land and containing 156 acres. Defendant Monongahela Natural Gas Company, a corporation in the business of producing and marketing natural gas, holds a lease on each of these farms "for the purpose and with the exclusive right of drilling and operating thereon for petroleum and gas," of which the leases were in force and effect. By the terms of these leases Monongahela is to pay to the respective lessors a fixed sum per year for the gas from each well drilled.

The farms of the Barnards were joined in such a way that at one corner of James' farm there is strange angle such that a circle large enough to include 10 acres of ground with its center at this corner would enclose less than two and one-half acres of James' land and seven and one-half acres of Daniel's and Elizabeth's land.  Monongahela drilled a well on James' farm in the corner described after plaintiffs had protested against it being located so near their lines. A second well was drilled on the plaintiffs' farm away from the boundary lines, but this well failed to produce any gas. The well located on James' farm did produce gas, which would drain the entire 10 acres of ground. Plaintiffs brought this action against Monongahela alleging that it located its well on the corner of James' farm did so with intent to fraudulently deprive the plaintiffs of their rights.

Issue:

Whether drilling of the well on the James' farm by the gas company and taking the gas therefrom invades the plaintiffs' own property rights.

Answer:

Yes.

Conclusion:

The appellate court opined that while oil operators know that fluid is deposited in a porous sand rock, at a distance ranging from 500 to 3,000 feet below the surface, and saturated throughout a large area, and that an oil or gas well may draw its product from an indefinite distance and in time exhaust a large space, the vagrant character of the mineral and the porous sand rock in which it is found and through which it moves precludes the exact mechanism by which this occurs.  Because a landowner has every right to drill a well on his own land at whatever spot he may see fit," he certainly not allowed to stop his adjoining neighbor from developing his own farm. There is no certain way to ascertain how much of the oil and gas that comes out of the well was when in situ under this farm and how much under that. Thus, every landowner or his lessee may locate his wells wherever he pleases regardless of the interests of others. He may distribute them over the whole farm or locate them only on one part of it. Given the vagrant character of oil and gas, the appellate court agreed with the district court that an injunction was not an appropriate remedy.

Access the full text case Not a Lexis Advance subscriber? Try it out for free.
Be Sure You're Prepared for Class