U.v. Industries, Inc. v. Danielson

Submitted September 18, 1979. This matter is before this Court on certification from the United States District Court for the District of Montana. Plaintiffs-respondents are grantees under a mineral deed from the owner and lessor of the oil and gas beneath the E 1/2 of section 10 in Richland County, Montana. Defendants-applicants are the lessee and its assigns under the ""Danielson"" oil and gas lease covering this tract; some of the applicants are or were also lessees under the ""Lewis"" oil and gas lease covering an adjacent tract, the NW 1/4 of section 10. On May 12, 1975, respondents, the grantees, brought suit in state District Court in Richland County, requesting damages from the applicants for the period between February 3, 1970 and September 14, 1972, for failure to drill an offset well to protect their oil interests from drainage by a producing well on an adjacent tract of land (Lewis lease). The case was removed to the United States District Court for the District of Montana, which has certified several issues to this Court for declaratory judgment regarding applicable Montana law, on application of the lessees pursuant to Rule 1 of the Rules of this Court.