with Defendant.
These underlying causes of action are the connecting nexus between the commingling of oil and gas with different ownership interests as set forth in Examples B – E and receiving damages resulting from the wrongful commingling. Commingling itself is not in and of itself a separate cause of action.
“…The fact that the exact amount of oil produced and converted by defendant cannot be precisely determined is no reason for denying plaintiffs a recovery for their interest in the 275,000 barrels conservatively estimated by the jury. “The law requires only that the evidence be sufficient to enable the jury to estimate the loss or damages with reasonable certainty. Damages will not be disallowed merely because the amount thereof can be stated only approximately. Thus the fact that the exact number of logs lost by the plaintiff by reason of the defendant’s unlawful obstruction of a stream cannot be definitely shown should not defeat his right of recovery.” 13 T. J. 368, Sec. 210.” Ortiz Oil Co. v. Luttes , 141 S.W.2d 1050, 1053 (Tex.Civ.App. – 1940) emphasis added The third of the West Trilogy Cases cites Oritz as the basis for its holding that the standard for proving damages in a commingling case is reasonable certainty . This last of the West Trilogy Cases further directly addressed the level of exactness Exxon had to assume to satisfy its burden of proof concerning the maximum amount of native gas in the reservoir as of the commencement date of injection of storage gas (West’s aliquot share of the native gas in place). “Where, as in this case, there has been a conversion of goods through intentional commingling, and the evidence establishes a reasonably certain estimate of the extent of property converted, judgment should be entered upon the basis of such amount, even though the precise amount cannot be ascertained with reasonable certainty. Ortiz Oil Co. v. Luttes, 141 S.W.2d 1050, 1055 (Tex.Civ.App.--Texarkana 1940, writ dism’d by agr.).” Exxon Corp. v. West , 543 S.W.2d 667, 673 (Tex.Civ.App. - 1976) If, as the court found in this West case, the Commingler met its burden of proof by establishing with reasonable certainty the respective ownership percentages of the commingled mass, the burden of proof was deemed satisfied and thus shifted back to the Aggrieved Party to prove or attempt to prove to the contrary. To meet this burden of proof, the court held that expert testimony, even though not contradicted by an opposing expert, is usually held NOT to be binding on the trier of fact EXCEPT where only one conclusion could be drawn
Into the Future – Reasonable Certainty
Once the Aggrieved Party has made and secured a fact finding that commingling of oil and/or gas has taken place, the burden of proof shifts to the Commingler to demonstrate with reasonable certainty the Aggrieved Party’s ownership share of the commingled oil and/or gas and thus its aliquot share of monies due from their sale. Ultimately, lying in wait is the default solution to the Commingler’s burden of proof problem – failure to establish the Aggrieved Party’s aliquot share of the commingled oil and/or gas results in the loss of and transfer of the value of the Commingler’s entire share of the value of the commingled oil and gas to the Aggrieved Party. Reasonable certainty appears to be the measurement utilized by the law to determine damages in commingling cases. In the Ortiz case ( Ortiz Oil Co. v. Luttes , 141 S.W.2d 1050 (Tex.Civ.App. 1940)), the court set forth the following rule: “The law requires only that the evidence be sufficient to enable the jury to estimate the loss or damages with reasonable certainty. Damages will not be disallowed merely because the amount thereof can be stated only approximately .” Ortiz Oil Co. v. Luttes , 141 S.W.2d 1050, 1053 (Tex.Civ.App. 1940) emphasis added That is, exactness in the Ortiz case was simply not possible but apparent ranges of the amount of property converted could be ascertained from the evidence presented. The jury responded to a special issue and found that the amount of oil produced from the Plaintiff ’s land was so intermingled that it could not determine Plaintiff ’s aliquot share of oil produced. The Defendant thus argued, in light of such a finding (inability to calculate the amount of oil converted by the Defendant with certainty), that Plaintiff was prohibited from recovering any amount of money as damages even though it had prevailed on its conversion cause of action. The appellate court disagreed
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N a t i o n a l A s s o c i a t i o n o f D i v i s i o n O r d e r A n a l y s t s
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