TEEATTORNEY GENERAL
OF TEXAS
Auwrmu ~~.TExAe
PRICE DANIEL
ATTORNEYGENERAL
Hon. Wll1ia.m J, JWray, Jr., Chairnmn
Railroad Commi6sion of Team
hatin 11, TeJras
Opinion No. V-836
Rot whore a traot of 65.65
aoipw3IS segregated out
of a 148.71 ao~e tract,
tawt the Comnisricin 00x1~
rldor the orlglnol tmot
to deterufae lðer tit0
r*grP*gakd traot ir etl-
t2md &Qanothu. wall 18
‘aa exorption to Rule 37r
You huve reque6teU mu? oplnlou with rmprrat to
the taeuaaae of a pemit a8 an exoeptlon to ?h~J,e 37* on
the Luir of ee~tuia facts subaWmd in frour requart.
la, brwlty, ue 8ummlse the toots 6a iol2ew81
li. P, Pouell hat made appl.ioatlvn to
the hll6Ilf66b#l ?OF 8 6jWOilhl *FIllit t0 drill
a fifth
wel.2;
u a ulxoeption to l@ale 37 on
his 65.65aare knot sh%oh ao&airu 2388 pro-
duatiw aore& Tirr D@IWBIII~LOU do66 Mb pant,
a8 an uroeptioa to the rpaalag mile, a asoond
OF udditieiial~,~~11 ii Ineluding the m
a4 ~11 #H well &n&y on the product puclra-
#
aare6 will be 2u8m than five aorea Sop each
onde~ this foamala of the am-
$s%‘i fiStl8 ml2 or2 the 23,04 gmxlwt$ve
aem could not b6 ~;rraead, It 16
I ‘i th8 ap lioant, heuewr, thrt the “Fa 2
Pane tZet
of 65. aozw ir 6 6thdivLion of a lrrg+r
8 5
148.71 6~6 tmdt; and &we there em aftlJ
rldmn wells on &he entlrr 148.71 acr8 &Wick,
ho ir entitled to anothm w&l on the 65.65
acvo Waot under tbs doatrine o? the 0ontw-y
kioa. William J, Rurray, Jr. -,Page 2 (v-836) .~
care? ~4km 65.65 lore traot woe degrepted
tram the 148.71 awe traot 6yb66qU6nt to
th6 prowlptian of’ the or$g1n61 sploi
rule, and rliqr the dL$mvery of’ pm&toY lon. .
The qwrtion presented Is whetbrr, under the
above faote, the Cwwtaaion 10 required to $rmt a
alt luthorleing the drilUn& of the fifth well on t R”
e’
Pour11 65.65 aare tract under u1e fhetrlfm 0E tM
m, oaae, .* ’
On,Hag 29, 1934, the Railroad Conualrel~n en-
,.tared the folfowlry order:2
“R uo~aatmmsn the RaIlFord Cor-
miarion oi !!a66, thaT Zn applying Rule 37
-.
1
olia ?etraloum Cg. ,130
9371 h 1Ql that where
the’suidiv%ed portion .
I# entitled to a 1 well in orae ta pro-’
toot the vested rights o$.th?.ouners ~o.~eoorer their
fair share of oil, a permit to drill’ a well, on the W-
regated tract may be sustained.. For.@ d&3cusslon @f
&he “Century Doctrine”, see 17 T,.L.Xt. 382 (note 1939); .
2
.
... -*
Hon.,william J. Murray, Jr. - Page 3 (v-836)
(spacing Rule) of statewide application
and in applying every special rule with
relation to spacing in every field in this
State no subdivision of property made sub-
sequent to the adoption of the original
spacing rule will be considered in deter-
mining whether or not any property Is being
confiscated within the terms of such spat-
lng rule, and no subdivision of property
will be regarded in applying such spacing
rule or in determining the matter of a@ka-
fiscatlon If such subdivision took place .
subsequent to the promulgation and adop-
tion of the original spacing rule.”
Under the “Rule of Ray 29” no subdlvlslon of
property made subsequent to the adoption of the original
spacing rule will be considered in determining whether
or not any property Is being confiscated within the terms
of such spacing rule, and the Commission cannot grant a
special permit for a well on a voluntary subdivided tract
on the basis of confiscation. Gulf Land Co. v. Atlantic
134 Tex. 59, 131 S W 2Q 73 (1939) . This
is subject to the ;oEtrlne of the Centur;y
case, and a siecial permit issued by the Commission en a
voluntarily subdivided ;tract may be upheld If the original
tract, a8 it was ‘before the subdivlslon, is entitled to
another well,to protect the landowner from drainage.
All of the caees applying the rule of the Centu
case appaar to’be based on a finding of.voluntary aud
slon within the meaning of the Rule. Although we have been
unable to find a definite expression by the courts that the
doatrlne of the Centure case Is applicable only where there
10 a voluntary subdivision, we believe such 1s true, be-
cause if the tract is not a voluntary subdlvlslon.wI.thln the
“Rule of May 29, ” the Commission could, upon a proper flnd-
lng, grant a permit for.a well on the segregated tract un-
der the~conflscatlon exception to Rule 37, The question
arlaea ‘only when’the Commission cannot grant the exception
because of,the ap llcation of the ‘Rule of Ray 29.” 31A
T’ex; :Jur. 689, II $07.
,.’
. .’ It is therefore material to determine If the
segregation of the 65'.65 acre Powell tract from the 148.71
acre Caddie Fisher tract is a voluntary subdivision within
the “Rule of Ray 29. ” Under the submitted facts, the POWeLl
Hon. William J. Murray, Jr, - Page 4 (v-836)
tract was segregated subsequent to the date of the
original spacing rule, and after the discovery of the
production. Also, at the time of the subdivlaion the
regular spacing pattern for the East Texan Field was
660’-330’.
The term “subd1v1e1on” as used in the “Rule
of May 29” was construed by the Supreme Court in Gulf
Land Co, v. Atlantic Refining COY, supra, as follows
n . The Rule of May 29th, supra,
uses tks’term lsubdivlsionl in defining
traote of land that have no protection
from confiscation. The Commission has not
seen fit to define ‘such term and ordinarily
it would not require, a deflnit$og,:)because
any tract of land segregated from a larger
tract would constitute a subdivision. It
is obviour that the term Isubdlvlslont 81)
used In the order or rule under discussion,
has no such general meaning. If such a mean-
ing should be given the, term, a partition 0~ ‘. ‘Y”* ‘..I:.
division of a 1,000 acre tract of land into two
500 acre tracts would constitute a subdivision
of the land under the rule. Manifestly, ‘such a
construction of the rule would be absurd,,ba-
cause the two 500-acre tracts would come under
its law against subdivision, while tracts of
much smaller area which do not constitute sub-
divisions after the effective date of Rule 37
would not. As we construe the rule pertaining
to reubdlvlsionl subsequent to the effective
date of Rule 37, It means that where a tract
of land ir of such size and shape that It is
nectirsary to obtain a permit aa a special
exception to the spacing provision of Rule 37
before a well can be drilled thereon, such a
tract will be regarded as a subdivision within
the meaning of the Rule of May29th, supra, if
it was subdivided out of a larger tract after
Rule 37 became effective, Humble Oil & Re-
fining Co. v, Railroad Commission (Tex, Civ.
APP., writ ref.), 94 S,W.2d 1197; Falvey v.
Simms 011 Co. (Tex, Clv. App~,), 92 S.W.28 292.”
._ .--
Ron. William J. Murray - Page 5 (V-836)
The Powell tract of 65.65 acres is generally
in a rectangular shape with an average width of 1389’
and an average length of 1900’ and Is of sufficient
size and shape that a well codd have been drilled
thereon without the necessity of a special exception
to the spacing provisions of Rule 37. The 65.65
acre tract would, therefore, not be a voluntary sub-
division within the “Rule of May 29th”, and the doc-
trine of the Centure case doe8 not apply;
As to the’particular facts of this case, how-
ever, two arguments might be urged to remove this case
from the above rule:
1. That the 65.65 acre tract is an edge lease
along the eastern side of the East Texas Field and the
four previous wells now on the tract were all drilled
as exceptions to the spacing rule; therefore, under the
Gul Land case definition, the 65.65 acre tract 1s a
& subdivision since the special permits grant-
ed on the first four iells are presumed to be necessary.
In answer to this, we believe that the four
prior wells were drilled as exceptions to Rule 37 In
order that such wells could be drilled 81) near known
production as possible, and not because of the size OS
rhape of the segregated tract.
2. That the C&f Lanf2;t;; f;ft;iti;;e;; ~~~~~j,
oable only to productive acres
and if the productive acres are of such a size m 8hape
that a special exception to the spacing provisions la re-
quired before a well could be drilled thereon, the traot
is a voluntary subdivision within the “Rule oi’ i?ay 29th.”
The above argument Is not applicable to the
facts of this case, and we render no opinion thereto,
since the record reveals no facts which would lead us
to believe that considering the Powell tract as a 23.04
acre tract, that It Is “a tract of land , , , of euch
size and shape that it Is necessary to obtain a permit
aa a special exception to the spacing re#ulatlon of Rule
37 before a well can be drilled thereon.
.-. __
Ron. William J. Murray - Page 6. (V-836)
i2Jmaix
Under the facts stated, a 5 .’
65.65 acre tract is not a voluntary
eubdlvision within the Commleslenis
Rule of May 29, 1934, and the Corn-
miaaion need not look to the original .’ ,
148.71 aorea, aa It waa prior to ae-
gregation, in determining whether ano-
ther well should be granted on the 65.65
acrea aa an exception to,Rule 37.
Yours very truly
ATTORREY
‘ORR
BY
JEWrbt
APPROVED
&u.2d’
0ENERAL
ATTORNEY