Enserch Exploration, Inc. v. Gardner

OPINION McCLOUD, Chief Justice. This is a suit for surface damages to land caused by the drilling and completion of an oil and gas well. At the time the well was drilled, H.J. Gardner and Louise Gardner owned only the surface rights in an 89.4-acre tract of land. When they objected to the proposed location of the well, Enserch Exploration, Inc.,. the oil and gas lessee, secured a temporary restraining order and drilled the well. The Gardners lost title to the land in 1985 when the Tyler Production Credit Association (PCA) foreclosed its mortgage. The Gardners filed suit against Enserch in 1986, alleging that it had “agreed to fairly compensate” them for the damages and loss of use of their property. The jury found that there was an “implied contract” and that the amount of damages to the surface of the property was $18,000. Judgment was rendered on the verdict for the Gardners, and Enserch appeals. We reverse and render.1 The jury’s verdict, omitting the explanatory instructions and definitions, reads in full as shown: [1] Do you find from a preponderance of the evidence that there was an implied contract2 that Enserch Exploration, Inc. would compensate H.J. Gardner and wife, Louise Gardner, for damages to their land by reason of the use of a portion of the land by Enserch Exploration, Inc.? ANSWER: We do [2] From a preponderance of the evidence, what do you find was the damage, if any, to the surface of the property in question by reason of operations of En-serch Exploration, Inc., its agents or employees? ANSWER: $18,000.00 Appellant has briefed four points of error, arguing that the trial court erred: (1) in denying its motion for instructed verdict; (2) in submitting the two special issues which were submitted to the jury; (3) in denying its motion for judgment non ob-stante veredicto; and (4) in denying its motion for new trial. In its arguments under the first three points of error, appellant insists that there was no proof of the “existence of a contract,” that any such oral contract was barred by the “Statute of Frauds,” that the Gardners had no “standing to sue” because of the foreclosure, and that there was a “material variance” between the pleadings and proof. In its argument under the fourth point of error, appellant argues that the jury’s answers to the two special issues are “so against the great weight and preponderance of the evidence as to be manifestly unjust.” [741] The landowners’ claims are based entirely upon proving the existence of a contractual obligation for payment of damages. They are not seeking a tort recovery for excessive or unreasonable use of the surface.3 H.J. Gardner testified that someone (whose name he could not remember) called him on the telephone, said that he worked for Enserch, and offered them $6,000 for surface damages to get their consent to the drilling of the well. Gardner said that, when he rejected the $6,000 offer and objected to the location of appellant’s proposed well, Enserch filed suit against them for an injunction. Gardner and his wife did not employ a lawyer, but Gardner appeared in court for the injunction hearing. The trial court permitted Enserch to go onto the Gardners’ property. According to Gardner’s testimony in this case, the judge “just told them, whatever damage you do, you will pay for.” Gardner said that he did not hire an attorney to appeal the injunction because the judge had told the En-serch representative (whose name he could not remember) and Enserch’s attorney that Enserch would have to pay for whatever damages they did to his property and that Enserch did not object to that ruling.4 After the well was drilled, Enserch issued a draft on April 24, 1985, for $5,000 with the notation: Settlement of surface damages resulting from drilling and construction operations on the P.V. McFarlin No. 1 Well in Smith County, Texas. The settlement draft was made payable to the PCA because it had foreclosed its lien on the property. Gardner testified that the PCA bid the property in at the foreclosure for the exact amount of the debt and accrued interest. Gardner claims that En-serch paid the wrong person for these surface damages. We hold that there is no evidence to support the finding of an “implied contract” to pay damages to the owners of the land for whatever damages re-suited from the drilling and completion operations on the land involved in this suit; consequently, the trial court erred in overruling the motion for instructed verdict, in submitting the two special issues, and in overruling the motion for judgment non obstante veredicto. The original offer to pay $6,000 was rejected by appellees, and there is no showing of any subsequent offers by Enserch which could have been accepted by appel-lees. The testimony about the injunction hearing (where H.J. Gardner states that the district judge told the Enserch representative and attorney that Enserch would have to pay for whatever damages it caused) did not show an offer and acceptance; consequently, that testimony is no evidence of the creation of any contract or agreement, neither express nor implied. Appellees did not seek to recover for violation of the terms of a judgment, and they did not introduce the judgment into evidence. The fact that Enserch voluntarily paid $5,000 to the party which it thought was the owner of the surface does not create any obligation to pay appellees. The judgment of the trial court is reversed, and this court renders judgment that H.J. Gardner and Louise Gardner take nothing from Enserch Exploration, Inc. Footnotes [1] This appeal was transferred from the Tyler Court of Appeals to this court pursuant to TEX. GOV’T CODE ANN. § 73.001 (Vernon 1988). [2] The jury was instructed that: [A] Contract is implied where, despite the absence of any express declaration of intent by the parties, their acts are such as to indicate, according to common understanding and the ordinary courses of dealing between men, a mutual intent to contract. If the facts are sufficient to support an implied promise, knowledge on the part of the promisor as to what the promisee actually expected is unnecessary and immaterial. There was an objection to this instruction in the trial court, but there is no point of error complaining of the instruction. [3] Those claims would have been barred by the two-year statute of limitations. See TEX.CIV.PRAC. & REM.CODE ANN. § 16.003(a) (Vernon 1986). [4] The surface owners had no legal right to deny Enserch, the mineral lessee, access to the land for mineral development purposes. Ball v. Dillard, 602 S.W.2d 521 (Tex.1980).