Amoco Production Co. v. Underwood
Texas Court of Civil Appeals
558 S.W.2d 509 (Tex. Civ. App. 1977)
Relevant factsFree
Days before the Underwoods' (plaintiffs) leases with Amoco (defendant) and its assignee Victory were set to expire, Victory pooled the leases with unrelated leases specifically to extend them, as confirmed by Victory's own letter stating the unit was designed "to hold" leases about to expire, with little genuine production rationale; the Underwoods sued to cancel the leases for lack of good faith, and the jury found in their favor.
IssueFree
Whether a lessee has a duty to exercise good faith toward the lessor and royalty owners in making a pooling designation.