Harry R. Carlile Trust v. Cotton Petroleum

1 This appeal presents for our decision four questions dealing with the standards of adequate notice for Corporation Commission spacing proceedings: [1] Is the Corporation Commission called upon to act in an adjudicative capacity when its statutory power is invoked to establish a drilling and spacing unit? [2] In Corporation Commission proceedings to establish a drilling and spacing unit, is notice to interested persons subject to the minimum standards of fairness exacted by the Due Process Clause? [3] Do the standards of due process, announced by this court in Cravens v. Corporation Commission, govern when nonproducing mineral interests alone are sought to be embraced within a spacing unit? [4] Should the teaching of Cravens be applied retroactively to include only Carlile (the victorious quiet-title plaintiff below), or purely prospectively to affect those spacing units comprised of non-producing leaseholds which will be formed by orders promulgated after the effective date of todays pronouncement? While we answer the first three questions in the affirmative, in response to the fourth question we hold that (a) todays pronouncement is to apply prospectively to spacing units which will be formed by Commission orders made after the effective date of this opinion, (b) all spacing orders made by the Commission prior to this opinions effective date herein shall be left unaffected by the notice standards pronounced today, but (c) orders yet to be made in proceedings presently pending before the Commission and those in cases now on direct appeal, in which areas under production are sought to be, or were, comprised within a spacing unit, shall be regarded as governed by notice standards of Cravens and (d) the district courts may treat as facially invalid all agency spacing and drilling orders issued after the effective date of this opinion which do not comply with the notice standards pronounced herein.