pjc-oil-and-gas-2022-lib

L ESSOR -L ESSEE I SSUES

PJC 303.25

PJC 303.25 Question on Force Majeure QUESTION ______

Did [ insert claimed force majeure event ] [ prevent lessee from/result in les see’s failure to/cause lessee’s delay in ] [ insert obligation, e.g., maintain(ing) production ]? Answer “Yes” or “No.” Answer: _______________ COMMENT When to use. PJC 303.25 should be used when there is a fact dispute regarding the application of the force majeure clause to avoid a lease obligation or termination. The specific terms in the force majeure clause will control. Hydrocarbon Manage ment, Inc. v. Tracker Exploration, Inc. , 861 S.W.2d 427, 436 (Tex. App.—Amarillo 1993, no writ). Source of question. PJC 303.25 is derived from Hydrocarbon Management, Inc. , 861 S.W.2d at 436 (noting that “lease terms are controlling regarding force majeure, and common law rules merely fill in gaps left by lease”); Moore v. Jet Stream Invest ments, Ltd. , 261 S.W.3d 412, 420 (Tex. App.—Texarkana 2008, pet. denied); and Sun Operating Ltd. Partnership v. Holt , 984 S.W.2d 277, 282–83 (Tex. App.—Amarillo 1998, writ denied). Burden of proof. The lessee has the burden to prove the affirmative defense of force majeure. Sun Operating Ltd. Partnership , 984 S.W.2d at 290 (citing Hydrocar bon Management, Inc. , 861 S.W.2d at 436). Other fact disputes. The terms of the lease may impose requirements other than causation. If so, consider whether additional modification or other questions or instructions are required to resolve any factual dispute on those requirements. See Rowan Cos. v. Transco Exploration Co. , 679 S.W.2d 660, 662, 664 (Tex. App.—Hous ton [1st Dist.] 1984, writ ref’d n.r.e.) (noting question on clause’s reasonable control requirement submitted to jury but undisputed evidence established fire not in lessee’s control; clause’s notice requirement not submitted to jury to the extent clause made notice a condition precedent to invoking clause); see also Moore , 261 S.W.3d at 420 (discussing whether order to cease production prevented production if regulatory order not “beyond reasonable control” of lessee, in absence of contractual lack-of-control requirement). Cf. Wolf Hollow I, L.P. v. El Paso Marketing, L.P. , 409 S.W.3d 879, 885– 87 (Tex. App.—Houston [14th Dist.] 2013) (noting when facts regarding cause and duration of each delivery were undisputed, legal question presented in appeal of sum-

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