UNDERGROUND PIPELINE TRESPASS IN SOUTH DAKOTA

My old law professor way back when held forth that man owns everything from heaven to hell. He meant to tell us that a landowner owns all the skies above and the ground deep below.  He is to be forgiven for this bold utterance because he was, I believe, born before the invention of airplanes.  His comments about ownership rights present an interesting question. What is the ground ‘below’?  Who owns it? Who has rights to it?  Both property owners and easement holders should be attentive to these questions.  Let us take a look.  We will learn that in our world my professor was wrong—a man’s ground is not necessarily his castle. Ah, but education is what remains after one forgets all one was supposed to learn.  To be sure South Dakota law recognizes that the owner of land has the right to the surface and to everything permanently situated beneath or above it. The law states “The owner of land in fee has the right to the surface and to everything permanently situated beneath or above it.”   But let’s take a closer look at underground trespass.

In North Dakota the Supreme Court addressed the issue of subsurface trespass in the modern context of horizontal drilling. In an important case a few years ago a mineral rights owner, the Plaintiff claimant, owned an interest in a quarter section of land. The oil company producer sought an agreement of all interests in the land in order to drill a horizontal well.  The Plaintiff refused to do a deal.  The Plaintiff also told the producer that it would consider any subsurface action affecting its interests as a subsurface trespass.  The oil company petitioned a state agency to ‘force pool’ the Plaintiff’s interest so that the property including the Plaintiff’s claims could be drilled. The agency approved the application. When the well was drilled the Plaintiff sued the producer under the legal theory of underground trespass. The Supreme Court held that in North Dakota the state has created a pro development policy and certain statutory and regulatory powers to promote, manage and develop natural resources throughout the state. The Court said that the state had the right to “impose such restrictions upon private (property) rights as are practically necessary for the general welfare of all.”

Subsurface trespass may still be an enforceable legal claim in situations that do not involve oil and  pooling powers. The Texas Supreme Court just last month found that a neighboring plaintiff claiming underground trespass must prove three things:  (1) entry of the alleged violation; (2) onto the property of another; and (3) without the property owner’s consent or authorization.  In this case the property owner (farmer) failed to show his ‘lack of consent’ and his claim was denied.  Someone wasn’t doing their homework in Texas. Subsurface trespass as a claim is untested in South Dakota but I predict will be upheld in the courts provided there is a showing of some harm to the property owner’s use or ‘enjoyment’ of his subsurface lands.  Pipeline operators, propagators of wastewater, utility companies, developers and surface owners can reduce potential problems in trespass by full disclosure, complete professional research of the legal and geological issues before starting a project, and by placing everything on the table, this means full disclosure, at a very early stage in a project.

Author:   David Ganje.   David Ganje of Ganje Law Offices practices in the area of natural resources, environmental and commercial law in North and South Dakota.

by David Ganje.