Armour Pipe Line Company assigned leases to its existing oil wells in Texas to Sandel Energy, Inc.
Question:
Armour Pipe Line Company assigned leases to its existing oil wells in Texas to Sandel Energy, Inc. The assignment included royalties for the oil produced from the wells. Armour specified that the assignment “does not pertain to production attributable to these leases from any new wells,” reserving for itself an interest in those royalties. Later, Armour—a foreign corporation in Texas— forfeited its certificate of authority to do business in the state. More than three years later, the certificate was reissued. Meanwhile, new wells were drilled on the leases. Sandel filed a suit in a Texas state court against Armour, claiming that the reservation of a royalty interest in those wells was “ineffective” because of the temporary forfeiture. When and why does a corporation need a certificate of authority? Is Armour entitled to the royalties from the new wells? Discuss. [Armour Pipeline Co. v. Sandel Energy, Inc., 546 S.W.3d 455 (Tex.App.—Houston (14th Dist.) 2018)] (See The Nature and Classification of Corporations.)
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Business Law Text And Cases
ISBN: 9780357129630
15th Edition
Authors: Kenneth W. Clarkson, Roger LeRoy Miller