Renee Christine Dietz v. Superior Oil Company

STATE OF LOUISIANA
COURT OF APPEAL, THIRD CIRCUIT

13-657

RENEE CHRISTINE DIETZ, ET AL.

VERSUS

SUPERIOR OIL COMPANY, ET AL.

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APPEAL FROM THE
FIFTEENTH JUDICIAL DISTRICT COURT
PARISH OF ACADIA, NO. 86,739
HONORABLE EDWARD D. RUBIN, DISTRICT JUDGE

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ULYSSES GENE THIBODEAUX
CHIEF JUDGE

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Court composed of Ulysses Gene Thibodeaux, Chief Judge, Marc T. Amy, and J.
David Painter, Judges.

AMY, J., concurs in part, dissents in part, and assigns reasons.

REVERSED IN PART AND
AFFIRMED IN PART.

William Wallace Goodell, Jr.
The Goodell Law Firm
P. O. Box 52663
Lafayette, LA 70505-2663
Telephone: (337) 412-2724
COUNSEL FOR:
Plaintiff/Appellant – Phyllis Smith McDonald

G. William Jarman
Charles Simon McCowan, III
Esteban Herrera, Jr.
Louis Victor Gregoire, Jr.
Kimberly K. Hymel
Kean Miller LLP
P. O. Box 3513
Baton Rouge, LA 70821
Telephone: (225) 387-0999
COUNSEL FOR:
Defendant/Appellee - Chevron U.S.A., Inc.

Stephen Barnett Murray
Stephen Barnett Murray, Jr.
Elizabeth Roché
Murray Law Firm
650 Poydras Street – Suite 2150
New Orleans, LA 70130
Telephone: (504) 525-8100
COUNSEL FOR:
Plaintiff/Appellant - Phyllis Smith McDonald

Tommy Woods Thornhill
Emily E. Gebhardt
Thornhill Law Firm
1308 Ninth Street
Slidell, LA 70458
Telephone: (985) 641-5010
COUNSEL FOR:
Defendant/Appellee - Jennings-Heywood Oil Syndicate

Robert Beattie McNeal
Mark LeRay McNamara
James E. Lapeze
Katie Caswell Cambre
Liskow & Lewis
701 Poydras Street – Suite 5000
New Orleans, LA 70139-5099
Telephone: (504) 581-7979
COUNSEL FOR:
Defendants/Appellees - Mobil Exploration and Producing North
America, Inc., Superior Oil Company, and Exxon Mobil
Corporation

Kim Reginald Hayes
Kim R. Hayes, APLC
408 North Parkerson Avenue
Crowley, LA 70526
Telephone: (337) 785-2760
COUNSEL FOR:
Plaintiff/Appellant – Phyllis Smith McDonald

Demarcus J. Gordon
Loulan Joseph Pitre, Jr.
Kelly Dussel Perrier
Gordon, Arata, McCollam, Duplantis & Eagan, LLC
201 St. Charles Avenue – Suite 4000
New Orleans, LA 70170-4000
Telephone: (504) 582-1111
COUNSEL FOR:
Defendant/Appellee - Jennings Holdings, LLC

Stuart Housel Smith
Michael Gregory Stag
John Leonard Fontenot, Jr.
Sean Seton Cassidy
Smith Stagg, L.L.C.
365 Canal Street – Suite 2850
New Orleans, LA 70130
Telephone: (504) 593-9600
COUNSEL FOR:
Plaintiff/Appellant – Phyllis Smith McDonald

Morgan J. Wells, Jr.
Stephen Marcus Larzelere
Larzelere, Picou, Wells, Simpson, & Lonero, LLC
3850 N. Causeway Boulevard - #1100
Metairie, LA 70002
Telephone: (504) 834-6500
COUNSEL FOR:
Defendant/Appellee - Carla Oil Company, Inc.

David Lyman Browne
Browne Law, LLC
365 Canal Street – Suite 1000
New Orleans, LA 70130
Telephone: (504) 648-0171
COUNSEL FOR:
Defendants/Appellees - Torch Energy Services, Inc. and Big Energy,
LLC

Michael R. Phillips
Kean Miller LLP
909 Poydras Street – Suite 1400
New Orleans, LA 70112
Telephone: (504) 585-3050
COUNSEL FOR:
Defendant/Appellee - Chevron U.S.A., Inc.

Clint David Bischoff
P. O. Box 530
Iota, LA 70543
Telephone: (337) 779-3661
COUNSEL FOR:
Defendant/Appellee - Two Bayous, Inc.

THIBODEAUX, Chief Judge.

In this property contamination case for injunctive relief and

restoration damages against numerous mineral lessees, the trial court granted the

lessees’ dilatory exceptions of prematurity and improper cumulation, dismissed the

property owner’s suit without prejudice, and denied her motion for new trial. On

appeal, we reverse the trial court’s granting of the exception of prematurity but

affirm the court’s granting of the exception of improper cumulation and the

dismissal of the suit of Ms. Phyllis Smith McDonald, the only plaintiff remaining

after all other claims were settled.

I.

ISSUES

We shall consider the trial court’s judgment:

(1) to grant the exception of prematurity;

(2) to grant the exception of improper cumulation and dismiss the
suit without prejudice; and

(3) to deny the motion for new trial.

II.

FACTS AND PROCEDURAL HISTORY

This case arises out of alleged soil and groundwater contamination

from oil and gas operations on two non-contiguous pieces of property in Acadia

Parish. The properties, owned by the Dietz family, were subject to two mineral

lease chains. One of the leases granted mineral interests to ExxonMobil, Corp.,

Superior Oil Co., Mobil Exploration and Producing North America, Inc., Big

Energy, L.L.C., Torch Energy Services, Inc., and Jennings Holdings, L.L.C. while

the other lease chain provided Chevron, U.S.A. and Carla Oil Co. with similar

lessee interests in the properties and facilities on surrounding parcels. In 2007,

eight members of the Dietz family filed numerous tort, property law, and contract

claims against the mineral lessees, asserting that the lessees improperly used and

abandoned oil field waste storage pits, flowlines, and exploration and production

equipment, causing extensive contamination to the Dietz’s properties. The Dietz

plaintiffs sought both injunctive relief and restoration damages.

After the Dietz plaintiffs filed a First Supplemental and Amending

Petition in 2008, the defendants responded by filing a dilatory exception of

prematurity, arguing that the defendants were not given proper notice prior to suit

as required under Mineral Code Article 136 and that the claims for restoration were

premature given the leases were still in effect and operations were ongoing. The

defendants also filed a dilatory exception of improper cumulation, contending that

the suit lacked the requisite community of interest among the actions and parties.

In 2009, the trial court delayed a ruling on the exception of prematurity but granted

the exception of improper cumulation, ordering the plaintiffs to amend the petition

by electing the actions they wished to proceed with and deleting the actions they

wished to discard.

The Dietz plaintiffs subsequently filed a Second Supplemental and

Amending Petition, but failed to remove any parties or actions. In response to this

petition, the defendants reasserted the exception of prematurity and the exception

of improper cumulation, requesting that plaintiffs’ claims be dismissed under

La.Code Civ.P. art. 464 for failure to comply with an order to amend. The Dietz

plaintiffs then filed a Third Supplemental and Amending Petition in which they

joined Ms. Phyllis Smith McDonald, the ex-wife of one of the Dietz plaintiffs and

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co-owner in indivision of the properties, as a plaintiff in the action. The eight

original Dietz plaintiffs then settled on March 13, 2012, leaving Ms. McDonald as

the sole plaintiff in the suit.

The trial court granted the defendants’ exceptions of prematurity and

improper cumulation, reasoning that the defendants did not receive the requisite

notice prior to suit under La.R.S. 31:136, and that there was no community of

interest among the cumulated actions. The court dismissed Ms. McDonald’s suit

without prejudice and later denied her motion for new trial.

III.

LAW AND DISCUSSION

Standards of Review

A trial court’s granting of a dilatory exception of prematurity and an

exception of improper cumulation is a final judgment subject to a manifest error

standard of review. Pinegar v. Harris, 08-1112 (La.App. 1 Cir. 6/12/09), 20 So.3d

1081; Lee v. Carruth, 221 So.2d 548 (La.App. 3 Cir.), writ denied, 223 So.2d 873

(La.1969).

A trial court’s decision to deny a motion for new trial is an

interlocutory judgment subject to appeal for abuse of discretion only upon a

showing of irreparable harm. Dural v. City of Morgan City, 449 So.2d 1047

(La.App. 1 Cir. 1984). However, “where a motion for appeal refers by date to the

judgment denying a motion for new trial, but the circumstances indicate that the

appellant actually intended to appeal from the final judgment on the merits, the

appeal should be maintained as being taken from the judgment on the merits” Id.

at 1048 (citing Smith v. Hartford Accident and Indemnity Company, 223 So.2d 826

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(La.1969); Fruehauf Trailer Company v. Baillio, 210 So.2d 312 (La.1968);

Kirkeby-Natus Corporation v. Campbell, 199 So.2d 904 (La.1967)).

Exception of Prematurity

Ms. McDonald argues that the trial court erred in granting the dilatory

exception of prematurity, reasoning that pre-suit notice of property contamination

claims are not required under the Louisiana Mineral Code and lessors may sue for

such damages prior to the termination of the oil and gas lease. We agree.

In granting the exception of prematurity, the trial court reasoned that

the defendants did not receive advanced written notice of the property restoration

claims prior to filing as required by Mineral Code article 136. However, this

reasoning is flawed. In pertinent part, Article 136 provides:

If a mineral lessor seeks relief from his lessee
arising from drainage of the property leased or from any
other claim that the lessee has failed to develop and
operate the property leased as a prudent operator, he must
give his lessee written notice of the asserted breach to
perform and allow a reasonable time for performance by
the lessee as a prerequisite to a judicial demand for
damages or dissolution of the lease.

The Louisiana Supreme Court has explicitly held that restoration claims from oil

and gas contamination are not governed by Article 136 and do not require pre-suit

notice since such claims “are separate and distinct from any claims that defendants

failed to develop and operate the property[.]” Broussard v. Hilcorp Energy Co.,

09-449, p. 12 (La. 10/20/09), 24 So.3d 813, 820. As Ms. McDonald’s claims all

involve restoration damages for groundwater and soil contamination, they are not

governed by Article 136 and no pre-suit notice is necessary.

While the trial court did not discuss in its judgment whether a suit

against a lessee for restoration damages may be brought during the term of a lease,

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Ms. McDonald still contends that such claims are not premature. We agree as the

Louisiana Supreme Court has, in our view, definitively decided this issue. In

Marin v. Exxon Mobil Corp. 09-2368 (La. 10/19/10), 48 So.3d 234, the supreme

court held that a lessor’s suit for soil and groundwater contamination damages

resulting from oil and gas operations may be brought prior to the end of a mineral

lease. In reaching its holding, the court reviewed a lessee’s statutory obligations

under a mineral lease:

A lessee’s obligations under a mineral lease are
governed by the Mineral Code and the Louisiana Civil
Code. La.R.S. 31:2 (providing that the provisions of the
Mineral Code are supplementary to the Civil Code and
when the Mineral Code does not expressly or impliedly
provide for a particular situation, the Civil Code or other
laws are applicable).

La.R.S. 31:122 provides:

A mineral lessee is not under a fiduciary
obligation to his lessor, but he is bound to
perform the contract in good faith and to
develop and operate the property leased as a
reasonably prudent operator for the mutual
benefit of himself and his lessor. Parties may
stipulate what shall constitute reasonably
prudent conduct on the part of the lessee.

The Civil Code lease provisions require the mineral
lessee to perform certain restoration obligations during
the lease term, and these obligations are governed by
Civil Code articles 2683, 2686, 2687, and 2692.
La.Civ.Code art. 2683 defines the lessee’s principal
obligations as follows:

The lessee is bound:

(1) To pay the rent in accordance with
the agreed terms;

(2) To use the thing as a prudent
administrator and in accordance with the
purpose for which it was leased; and

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(3) To return the thing at the end of
the lease in a condition that is the same as it
was when the thing was delivered to him,
except for normal wear and tear or as
otherwise provided hereafter.

[La.Civ.Code] art. 2686 provides “[i]f the lessee
uses the thing for a purpose other than that for which it
was leased or in a manner that may cause damage to the
thing, the lessor may obtain injunctive relief, dissolution
of the lease, and any damages he may have sustained.”
[La.Civ.Code] art. 2687 directs that “[t]he lessee is liable
for damage to the thing caused by his fault or that of a
person who, with his consent, is on the premises or uses
the thing.” Finally, [La.Civ.Code] art. 2692 provides
“[t]he lessee is bound to repair damage to the thing
caused by his fault ... and to repair any deterioration
resulting from his ... use to the extent it exceeds the
normal or agreed use of the thing.”

Marin, 48 So.3d at 255-56.

After outlining the lessee obligations, the Marin court reasoned that “while

[La.Civ.Code] art. 2683 contains obligations that only arise at the end of the

lease…, there is absolutely no language to suggest that the other obligations

imposed by these codal provisions are not operational until termination of the

lease.” Id. at 256. Here, as in Marin, Ms. McDonald’s claims involve damages for

soil and groundwater contamination. As such, while the leases may still be in

effect, these claims are not premature because there is no language in the mineral

or civil codes to suggest these claims for damages only arise upon lease

termination.

The defendants rely on three past decisions to support their position

that Ms. McDonald’s restoration claims are not effective until the termination of

the mineral leases. However, this reliance is unfounded in light of Marin.

First, the defendants cite language from the Louisiana Supreme Court

opinion, Corbello v. Iowa Production, 02-826 (La. 2/25/03), 850 So.2d 686, which

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outlines the temporal scope of a lessee’s duty to repair the leased premises under a

specific mineral lease:

The duty to repair the leased premises does not arise until
the lease expires, at which time the lessee must return the
property in good order. The 1929 mineral lease is still in
effect and is not the subject of this litigation. Thus, even
the present leaseholder does not yet have a duty to repair
under the terms of that lease.

Corbello, 850 So.2d at 703.

While this language arises in a supreme court opinion, we reject it as merely dicta

lacking persuasive force in light of the outcome determinative reasoning in Marin.

Moreover, we favor Marin given the fact that it post-dates Corbello and represents

the latest expression of the law.

The defendants next rely on Dore Energy Corp. v. Carter-Langham,

Inc., 04-1373 (La.App. 3 Cir. 5/4/05), 901 So.2d 1238, writs denied, 05-1484, 05-

1492, 05-1493, 05-1496, 05-1503, 05-1521, 05-1576, 05-1577, 05-1582 (La.

1/9/06), 918 So.2d 1042-47 and Kinder Gas, Inc. v. Reynolds, 11-1012 (La.App. 3

Cir. 2/1/12), 84 So.3d 695 where this court held that a lessee’s restoration

obligations are premature as long as operations are ongoing under a current lease.

While we respect the views of our brothers on the bench, these opinions have

unnecessarily broadened the scope of premature claims beyond what the supreme

court envisioned in Marin. The Marin court explicitly stated that “a lessor need

not wait until the end of the lease to sue a lessee for damage to his property.”

Marin, 48 So.3d at 256. The Court never mentions ongoing operations as a basis

for determining premature claims; rather, it allows for all damage claims to be

brought during the term of the lease. As such, we must reject the holdings of Dore

and Kinder Gas in favor of Marin. As Marin aligns directly with the facts of this

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case, we find that the trial court was manifestly erroneous in granting the exception

of prematurity.

Exception of Improper Cumulation

Ms. McDonald argues that the trial court erred in granting the

defendants’ exception of improper cumulation due to a lack of community interest

between the joined parties. She further contends that the trial court improperly

dismissed her case without prejudice for improper cumulation. We disagree.

Louisiana Code of Civil Procedure Article 463 outlines the three

requirements for proper cumulation of actions:

Two or more parties may be joined in the same suit,
either as plaintiffs or as defendants, if:

(1) There is a community of interest between the parties
joined;

(2) Each of the actions cumulated is within the
jurisdiction of the court and is brought in the proper
venue; and

(3) All of the actions cumulated are mutually consistent
and employ the same form of procedure.

In determining whether the requisite community of interest exists, the Louisiana

Fourth Circuit Court of Appeal provides further guidance:

The test in determining whether the parties have a
community of interest is whether the cumulated causes of
action arise out of the same facts or whether they present
the same factual or legal issues. Strahan, et. al. v. Maytag
Corp., et al., 99-869, [(La.App. 4 Cir. 4/5/00), 760 So.2d
463]. Essentially, community of interest is present
between different actions or parties, where enough
factual overlap is present between the cases to make it
commonsensical to litigate them together. See also First
Guaranty Bank v. Carter, [563 So.2d 1240 (La.App. 1
Cir. 1990)], (citing, The Official Revision Comments to
Article 463 which states that a review of Louisiana case

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law indicates that a community of interest and common
interest refer to exactly the same concept).

Albarado v. Union Pac. R.R. Co., 00-2540, pp. 10-11 (La.App. 4 Cir. 4/25/01), 787

So.2d 431, 438 reversed on other grounds, 01-1537 (La. 9/14/01), 796 So.2d 666.

Applying this test to Ms. McDonald’s claims, there is no community

of interest. In making this determination, we find our court’s conclusion in

Broussard v. Hilcorp Energy Co., 08-233 (La.App. 3 Cir. 12/10/08), 998 So.2d

946, aff’d, 09-449 (La. 10/20/09), 24 So.3d 813 especially compelling. In

Broussard, this court upheld an exception of improper cumulation in a case

involving property contamination on noncontiguous tracts with multiple leases and

numerous operators allegedly at fault. The court reasoned that proof of damages

and liability would be different for each party, and thus, “[it could not] say that

there [was] enough factual overlap present between all the actions to make it

commonsensical to litigate them together.” Id. at 953. Here, like in Broussard,

Ms. McDonald’s claims involve oil and gas contamination from numerous

operators under multiple leases on noncontiguous pieces of property. While Ms.

McDonald contends the defendants all engaged in similar negligent conduct, this

fact alone is not enough to support cumulation given the extensive time period of

operations, the different lease obligations, and the specific facts that would need to

be proven to show liability for each operator. Accordingly, we find that the trial

court was not manifestly erroneous in granting the exception of improper

cumulation.

Ms. McDonald’s argument that the trial court erred in dismissing her

case for improper cumulation also lacks merit. Louisiana Code of Civil Procedure

Article 464 states, in pertinent part, that:

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When the cumulation is improper for any other
reason, the court may: (1) order separate trials of the
actions; or (2) order the plaintiff to elect which actions he
shall proceed with, and to amend his petition so as to
delete therefrom all allegations relating to the action
which he elects to discontinue. The penalty for
noncompliance with an order to amend is a dismissal of
plaintiff's suit. (emphasis added).

In accordance with this procedure, the trial court granted the defendants’ exception

for improper cumulation in 2009 and ordered the plaintiffs to amend their petition

by deleting all actions in which they elected to discontinue. In reviewing the

record, the plaintiffs failed to comply with this order in their Second Supplemental

and Amending Petition as they did not delete any actions but merely stated the

same causes of action with greater detail and more allegations. The Third

Supplemental and Amending Petition also failed to correct the cumulation error as

it only added Ms. McDonald as a plaintiff in the litigation. Louisiana Code of

Civil Procedure Article 464 clearly states that “[t]he penalty for noncompliance

with an order to amend is a dismissal of plaintiff’s suit.” This language is not

discretionary; it is mandatory under the Code. While we recognize that Ms.

McDonald entered the litigation after the other plaintiffs failed to comply with the

cumulation order, she still elected to adopt all of the prior pleadings and

allegations. As such, she is bound by the consequence of these pleadings which, in

this instance, is dismissal for noncompliance. See Bailey ex. Rel. Brown v.

ExxonMobil Corp., 11-459 (La.App. 5 Cir. 5/31/12), 102 So.3d 167, writ denied,

12-2204 (La. 1/18/13), 107 So.3d 629. Accordingly, we find the trial court was not

manifestly erroneous in dismissing the suit without prejudice.

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Motion for New Trial

Ms. McDonald contends that the trial court erred in denying her

motion for new trial. We reject this argument as this appeal should be maintained

solely as one on the merits. “[W]here a motion for appeal refers by date to the

judgment denying a motion for new trial, but the circumstances indicate that the

appellant actually intended to appeal from the final judgment on the merits, the

appeal should be maintained as being taken from the judgment on the merits”

Dural v. City of Morgan City, 449 So.2d 1047, 1048 (La.App. 1 Cir. 1984). In

order to show intent, the appellate court may consider “the appellant’s assertion to

that effect, whether the parties briefed issues on the merits of the final judgment

and whether the language of the order granting the appeal indicated that it was a

judgment denying a new trial.” Id. Here, while Ms. McDonald referred to the

judgment denying a new trial by date in her motion for devolutive appeal, she

relied solely on the already raised arguments regarding the exceptions of

prematurity and improper cumulation to support this point. It is clear that Ms.

McDonald’s true intent behind this appeal was to find yet another means of

challenging the merits of the exceptions judgment, and we will treat it as such. As

the merits of this case have already been discussed above, we need not address

them further here.

IV.

CONCLUSION

For the foregoing reasons, we reverse the trial court’s granting of the

exception of prematurity, but we affirm the granting of the exception of improper

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cumulation and the dismissal of Ms. McDonald’s case without prejudice. Costs

are assessed against Ms. McDonald.

REVERSED IN PART AND AFFIRMED IN PART.

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NUMBER 13-657

COURT OF APPEAL, THIRD CIRCUIT

STATE OF LOUISIANA

RENEE CHRISTINE DIETZ, ET AL.

VERSUS

SUPERIOR OIL COMPANY, ET AL.

AMY, J., concurring in part and dissenting in part.

I concur in the result reached by the majority in its reversal of the decision

sustaining the exception of prematurity. However, I respectfully dissent from the

remainder of the opinion since I would reverse the trial court’s decision sustaining

the exception of improper cumulation of actions. In my opinion, this matter

satisfies the requirements of La.Code Civ.P. art. 463 and is factually

distinguishable from the factual background described in Broussard v. Hilcorp

Energy Co., 08-233 (La.App. 3 Cir. 12/10/08), 998 So.2d 946. In Broussard, the

properties involved were five, non-contiguous tracts located in three separate

sections. Id. The Broussard panel additionally explained that “different parties

and combinations of parties [were] alleged to have contributed to the

contamination on each [tract], and the times at which contamination allegedly

occurred differ[ed] for each property.” Id. at 953. The present matter, however,

offers fewer dimensions than did Broussard. Notably, the appellant is the sole

remaining plaintiff and the involved property is limited to two tracts of land,

located within the same quarter of a quarter of a section. The plaintiff alleges that

the same groundwater plumes affect both tracts. Given these circumstances, I find

that there was a sufficient community of interest in this case to satisfy the

requirements of La.Code Civ.P. art. 463.

In sum, and for the foregoing reasons, I would reverse both the exception of

prematurity and the exception of improper cumulation of actions sustained by the

trial court. I respectfully concur in part and dissent in part from the majority

opinion.

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