Joint Operating Agreement: Non-consent Election Joint Operating Agreement: Overpayments; Recoupment

摘要

Marlin is the operator of the well at issue in this case, and Lurie owns a 2.36502% non-operating net revenue working interest in the well. Lurie elects to go non-consent in a rework of the subject well, so Marlin suspends payments to Laurie until Marlin recovers 300% of the costs allocable to Lurie's working interest. After recovering the non-consent penalty, Marlin places Lurie back in pay status. However, in doing so, an error occurs in Martin's computerized accounting system which over-states Lurie's interest in the well. Rather than paying Lurie based upon his 2.36502% net revenue interest, Marlin mistakenly begins paying Lurie based on a 19.006109% net revenue interest. When Lurie receives the first monthly check that overpaid him in error, the check stub reflects the 19.006109% inflated net revenue interest. Apparently surprised by the amount, Lurie contacts Marlin personnel to inquire as to whether the amount of the check is correct, and Marlin personnel advise him that the amount is correct. Lurie does not ask Marlin about the erroneous net revenue interest percentage shown on the check stub. Marlin does not discover the error until approximate two and a half years later, resulting in overpayments totaling $163,327.96. However, since Lurie is likewise mistakenly over-billed for well expenses based on a proportionately larger working interest in the amount of an additional $27,702.61, which Lurie paid, the net effect is that Lurie is over-billed in the net amount of $135,625.35 during that period. Upon discovering the mistaken over-payments, Marlin calls Lurie and requests repayment in the amount of $135,625.35. Lurie advises Marlin that Lurie has spent the money and cannot repay it. Marlin files the present lawsuit to recoup the overpayments under the theories of unjust enrichment and breach of contract, and Marlin further seeks a declaratory judgment. Lurie asserts that the computer error was either known or should have been known by Marlin and, therefore, was not a mistake.