828 S.E.2d 800
W. Va.2019Background
- Plaintiffs Margot Crowder and David Wentz own surface parcels within a 351-acre tract (the “Carr Tract”) whose mineral rights were leased in 1901 to predecessors of EQT. The surface was severed from the mineral estate in 1936.
- EQT (lessee under the 1901 lease) obtained a 2011 amendment from the then-mineral owners allowing pooling/unitization with neighboring tracts and thereafter built well pads and drilled horizontal Marcellus wells from plaintiffs’ surface, with laterals extending under adjacent properties.
- Plaintiffs notified EQT in 2012 that EQT had rights to use the surface only to extract minerals from beneath the Carr Tract and demanded EQT not enter for off-tract production; EQT proceeded anyway.
- The circuit court granted partial summary judgment holding EQT trespassed to the extent it used plaintiffs’ surface to drill/produce gas from neighboring mineral estates; a jury awarded $190,000 in damages to plaintiffs.
- EQT appealed, arguing implied surface-use rights include off-tract development if reasonably necessary (and relying on the 2011 unitization amendment); the Supreme Court of Appeals affirmed the trespass ruling.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether mineral owner/lessee may use servient surface to access minerals located under neighboring tracts absent express surface-owner consent | Crowder/Wentz: implied surface easement is limited to extraction of minerals under the specific surface tract; use for neighboring tracts is trespass | EQT: implied right to use surface extends to reasonably necessary means to develop minerals (including off-tract laterals), and the 2011 unitization amendment permits such use | Held: Implied surface-use right is limited to minerals under the specific tract; using the surface to benefit off-tract production without express agreement is trespass |
| Whether the 1901 lease or the 1936 severance allowed off-tract drilling from Carr Tract surface | Crowder/Wentz: lease and severance contain no express grant allowing off-tract use; rights belong to surface owner and were not conveyed | EQT: 1901 lease language and 2011 amendment (pooling/unitization) justify off-tract operations from Carr surface | Held: 1901 lease applies to the Carr Tract only; 2011 amendment could not convey surface rights once the surface estate had been severed in 1936; no express right exists |
| Whether reasonableness/necessity of horizontal drilling for off-tract recovery defeats trespass claim | Crowder/Wentz: even if technique is reasonable, reasonableness cannot create an implied right to use surface for off-tract mineral recovery | EQT: horizontal drilling was reasonably necessary to develop the reservoir; this legitimizes surface use | Held: Reasonableness cannot imply an off-tract use right; implied easement limited to on-tract minerals regardless of necessity |
| Standard of review for summary judgment and circuit court legal determinations | Crowder/Wentz: circuit court correctly applied law and granted partial summary judgment | EQT: factual/legal issues about necessity and scope should preclude summary judgment | Held: Summary judgment reviewed de novo; no genuine issue of material fact that EQT exceeded implied rights — summary judgment affirmed |
Key Cases Cited
- Painter v. Peavy, 192 W.Va. 189, 451 S.E.2d 755 (W. Va. 1994) (summary judgment reviewed de novo)
- State ex rel. Cooper v. Caperton, 196 W.Va. 208, 470 S.E.2d 162 (W. Va. 1996) (legal conclusions reviewed de novo where findings entail legal judgments)
- Hark v. Mountain Fork Lumber Co., 127 W.Va. 586, 34 S.E.2d 348 (W. Va. 1945) (definition/principle of trespass)
- Squires v. Lafferty, 95 W.Va. 307, 121 S.E. 90 (W. Va. 1924) (mineral owner’s implied right to use surface reasonably necessary for enjoyment of mineral estate)
- Faith United Methodist Church & Cemetery of Terra Alta v. Morgan, 231 W.Va. 423, 745 S.E.2d 461 (W. Va. 2013) (background on severance and ad coelum principles)
- Buffalo Mining Co. v. Martin, 165 W.Va. 10, 267 S.E.2d 721 (W. Va. 1980) (test for implied surface rights: reasonably necessary and without substantial burden)
- Adkins v. United Fuel Gas Co., 134 W.Va. 719, 61 S.E.2d 633 (W. Va. 1950) (court duty to determine whether mineral owner exceeded fairly necessary surface use)
- King v. S. Penn Oil Co., 110 W.Va. 107, 157 S.E. 82 (W. Va. 1931) (implied surface-use right does not contemplate benefit of production from another tract)
- Russell v. Texas Co., 238 F.2d 636 (9th Cir. 1956) (well-established principle that surface use incident to mineral rights does not authorize use to aid operations on other lands)
- Brown v. Spilman, 155 U.S. 665 (U.S. 1895) (capture doctrine and principles on migration of oil and gas)