Nathan Hecht

AUSTIN, Texas (Legal Newsline)-Even if a landowner holds a claim to minerals or water below his property, he cannot seek damages from subsurface trespass, the Texas Supreme Court ruled last week.

In the case of Coastal Oil & Gas Corp. and Coastal Oil & Gas USA LP v. Garza Energy Trust, the state high court considered whether the rule of capture allows for damages.

The Supreme Court decision reverses the court of appeals' judgment, renders judgment in part, and remands the case to the trial court.

"We reverse the court of appeals' judgment, render judgment that Salinas take nothing on his claims for trespass and breach of the implied covenant to protect against drainage, and remand the remainder of the case for a new trial," Justice Nathan Hecht wrote for the majority.

In this case, Coastal Oil & Gas Corp. and Coastal Oil & Gas USA LP alleged that Garza Energy Trust pulled minerals from beyond its leased area.

The state Supreme Court ruled that mineral owners cannot sue adjacent operators for trespass, but may instead sue their own lessee for not producing their own minerals in the first place.

The Supreme Court has grappled with the case since late 2005. In March, two additional justices - Tracy Christopher and Robert Pemberton - were appointed by Gov. Rick Perry to help in the ruling.
Supreme Court case No. 05-0466.

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