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Patterson v. Stanolind Oil & Gas Co.
Citations: 305 U.S. 376; 59 S. Ct. 259; 83 L. Ed. 231; 1939 U.S. LEXIS 992Docket: 113
Court: Supreme Court of the United States; January 3, 1939; Federal Supreme Court; Federal Appellate Court
In the case of Patterson v. Stanolind Oil & Gas Co., the plaintiff sought to recover oil royalties and challenged the constitutionality of the Well-Spacing Act of Oklahoma under the contract clause, due process, and equal protection clauses of the Fourteenth Amendment. The Oklahoma Supreme Court upheld the validity of the statute and a related order from the Corporation Commission, which established ten-acre well-spacing units in the North Wellston area, encompassing 520 acres. The well in question was located on a 6 1/4-acre tract, with an adjacent 3 3/4-acre tract owned separately. The statute stipulates that royalty owners of separately owned tracts within a drilling unit share in one-eighth of the production based on their acreage's proportion to the entire unit. Consequently, the owners of the 3 3/4-acre tract were permitted to share in the oil produced from the well, despite its location solely on the 6 1/4-acre tract. The plaintiff argued that this sharing arrangement constituted an unconstitutional deprivation of property and an impairment of contractual rights. The Corporation Commission justified the ten-acre drilling unit size based on geological and production data, asserting that it would promote optimal drainage, uniform extraction, and conservation of reservoir energy, while protecting the rights of leaseholders and royalty owners in the oil pool. The Commission's findings and order were made following a proper hearing, although the evidence supporting these findings is not recorded. The state court concluded that the water supply for the well in question is shared with adjacent land and extends to an additional tract. Consequently, the court applied established legal principles to reject the plaintiff's claims under the Fourteenth Amendment and the contract clause, referencing several precedents. The plaintiff’s argument that the statute enabling the Commission to set drilling unit regulations is void due to indefiniteness was dismissed as meritless. Ultimately, the plaintiff failed to present a substantial federal question, leading to the dismissal of the appeal for lack of jurisdiction.