Amoco Production Co. v. Alexander
Texas Supreme Court
622 S.W.2d 563 (1981)
The Alexanders (plaintiffs) leased oil and gas rights to Amoco Production Co. (Amoco) (defendant). The lease was for an area on the lower part of a sloped water-drive oil field. Its location on the lower part of the field put the Alexanders’ lease at a disadvantage as compared to leases on the higher end of the field. Leases on the lower end would “water out” more quickly, meaning that the wells would fill up with water rather than oil. This was particularly the case when leases on the higher end of the slope were producing significant amounts of oil. When the higher wells actively produced, oil from the lower end leases would drain to the higher lands and be replaced with water. In addition to its lease with the Alexanders, Amoco had separate leases on the higher end of the same sloped field. At some point the Alexanders’ portion of the field watered out. The Alexanders brought suit against Amoco. The Alexanders alleged that Amoco intentionally produced less oil on the Alexanders’ lower portion of the field and chose instead to overproduce on Amoco’s leases on the higher end of the field in order to cause the Alexanders’ lease to water out more quickly. Specifically, the Alexanders alleged that Amoco breached the implied covenant to protect against drainage. Amoco argued that the Texas Railroad Commission’s (Commission) regulations prevented Amoco from drilling replacement wells anywhere that would have prevented the drainage. Amoco had not sought an exception to the regulations. The trial court found in favor of the Alexanders and awarded damages, including exemplary damages. The Texas Court of Civil Appeals affirmed. Amoco appealed.
Rule of Law
Holding and Reasoning (Campbell, J.)
What to do next…
Unlock this case brief with a free (no-commitment) trial membership of Quimbee.
You’ll be in good company: Quimbee is one of the most widely used and trusted sites for law students, serving more than 724,000 law students since 2011. Some law schools—such as Yale, Berkeley, and Northwestern—even subscribe directly to Quimbee for all their law students.Unlock this case briefRead our student testimonials
Learn more about Quimbee’s unique (and proven) approach to achieving great grades at law school.
Quimbee is a company hell-bent on one thing: helping you get an “A” in every course you take in law school, so you can graduate at the top of your class and get a high-paying law job. We’re not just a study aid for law students; we’re the study aid for law students.Learn about our approachRead more about Quimbee
Here's why 724,000 law students have relied on our case briefs:
- Written by law professors and practitioners, not other law students. 45,600 briefs, keyed to 983 casebooks. Top-notch customer support.
- The right amount of information, includes the facts, issues, rule of law, holding and reasoning, and any concurrences and dissents.
- Access in your classes, works on your mobile and tablet. Massive library of related video lessons and high quality multiple-choice questions.
- Easy to use, uniform format for every case brief. Written in plain English, not in legalese. Our briefs summarize and simplify; they don’t just repeat the court’s language.