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MIGRATORY THINGS ON LAND:
Property Rights and a Law of Capture
Bryan Clark (Heriot Watt University, Edinburgh)(1)
Contents
- Introduction
- Ownership 2.1 What is ownership? 2.2 The importance of ownership
- General principles of landownership 3.1 The 'infinite carrot'? 3.1.1 England 3.1.2 Scotland 3.2 Practical effects of the doctrine 3.2.1 The doctrine in England 3.2.2 The doctrine in Scotland 3.3 3.3 Subterranean rights
- Property rights in migratory things 4.1 Property rights in running water in Scotland and England 4.1.1 General points under English law 4.1.2 Riparian rights in England 4.1.3 Property rights and subterranean water in England 4.1.4 General points in Scots water law 4.1.5 Riparian rights in Scotland 4.2 Rights of property in fugacious minerals and other sub-soil materials 4.3 US theories of ownership of hydrocarbons 4.3.1 Hydrocarbons as res nullius 4.3.2 'Texas theory' 4.3.3 Qualified ownership 4.4 English/Commonwealth cases relating to subsoil substances 4.4.1 Natural gas 4.4.2 Fugacious minerals in Scots law
- A law of capture? 5.1 Law of capture and occupatio 5.2 Water 5.2.1 England and Wales 5.2.2 Scotland 5.3 The law of capture and hydrocarbons 5.3.1 USA guidance on hydrocarbons 5.3.2 Commonwealth guidance - natural gas 5.3.3 Asphalt (pitch) 5.3.4 Running Silt 5.3.5 Brine
- Concluding remarks 6.1 Comparing ownership rights 6.2 A law of capture and rights of support 6.3 Capture when there is no erosion of support 6.4 Concerns Notes
1. Introduction
This article is concerned with an analysis and discussion of how both Scottish and English law approach and rationalise rights in property and other resulting and associated rights in relation to fugacious and migratory properties which move to and fro across tracts of land by virtue of their inherent characteristics. This definition encompasses such things as running water, wild animals and fugacious minerals. For want of a more eloquent means of expression, in this article such objects have been termed 'migratory things'.(2)
The article begins by seeking to establish two main principles: first, the extent to which rights of property can be said to exist in migratory things present upon or beneath land and secondly, the extent to which a law of capture operates in relation to such things. A law of capture would sanction the appropriation of migratory things from another's land by the carrying out of works or some other activity upon one's own land. The term 'law of capture' was first coined during the oil boom in late 19th^ century USA, where the expression was used to describe the legal sanctioning of the appropriation from a common reservoir of oil underlying the land of another by legitimate drilling activities. The courts at that time were quick to draw analogies with, and draw upon the law relating to, other things that were perceived to share the 'vagrant' characteristics of oil such as running waters and wild animals.
As this article will illustrate, however, the law relating to migratory things is opaque and uncertain, and both under Scots and under English law there may be real difficulties in rationalising judicial approaches to migratory things with established principles of land law. This article seeks to unravel at least some of the uncertainties that exist, compare and contrast the approaches of the two systems, and discuss some of the problems invoked by the current state of the law.
2. Ownership
2.1 What is ownership?
In assisting the analysis it may first be prudent to cast an eye over what the concept of ownership in general entails. In common parlance, ownership is a term that most of us take for granted in that if we buy, are given or inherit items, ownership generally follows. Ownership implies the general liberty to use, dispose, destroy or transfer the thing in question to others. If ownership rights are to be meaningful in any practical way then it is important that they are safeguarded in some sense against the actions and claims of others. The right of ownership is safeguarded by (amongst others means) law. Ownership can thus be referred to as 'the legal right that a legal system grants to an individual in order to allow him or her to exercise the maximum degree of formalized control over a scarce resource'.(3)^ This idea can be derived from the civil law concept of dominium , the greatest right in property to 'use and
This legal proposition is very much symptomatic of the historical inductive development of the common law system, whereby it was the existence of recognised legal remedies themselves that bestowed rights, rather than the deductive civilian notion that the existence of a general right would confer certain remedies. As no special remedies under English common law have developed to enforce proprietary rights, actions tend to be brought on grounds such as trespass, tort or nuisance, which are based upon interference with possession.(13)
As this article will illustrate, in many instances, the English cases which deal with migratory things are therefore not generally concerned with whether or not ownership vests in the thing appropriated but rather whether any remedy arises where the right of one party is damaged by the actions of another - for example, in nuisance, under a right of support or contrary to certain riparian rights. In Scotland, although such grounds of complaint may be sought where appropriate, remedies do arise from the fact of ownership itself and hence the more important issue is likely to be dominium and rights which arise therefrom.
3. General principles of landownership
3.1 The 'infinite carrot'?
3.1.1 England
The absolute nature of the rights to the land bestowed by a grant in fee simple have been set out by Coke as
Land, in the legal signification comprehendeth any ground, soil or earth whatsoever, as meadows, pastures, woods, moores, waters, marshes, turfs and heath... It legally includeth all castles, houses and other buildings... [and] besides the earth doth furnish man with many other necessaries for his life, as it is replenished with hidden treasures, namely with gold, silver, brasse, iron, tynne, leade and other mettels and also with great varietie of precious stones and many other things for profit, ornament and pleasure. And lastly the earth hath in law a great extent upwards, not only of water, as hath been said, but of ayre and all other things up to heaven, for cujus est solum ejus est usque ad coelum.. .(14)
This last maxim, literally that 'to whomsoever the soil belongs he also owns it to the sky', was later augmented by 'ad centrum terrae' - to the centre of the earth - or ' et ad inferos ' - to the depths. As we shall see, below, however, this concept has been limited in a practical sense under English law.
3.1.2 Scotland
The doctrine is also recognised under Scots land law. In Scotland 'a conveyance of land in unqualified terms [ dominium utile ] gives a right to property in the substance or solid contents of the land without any assignable limit. This is what is meant by a conveyance being a coelo usque ad centrum. There are no limits in the vertical direction except such as physical conditions impose.'(15)
3.2 Practical effects of the doctrine
What the doctrine in its pure sense means is that the owner in fee simple or holder of the dominium utile has an absolute right to not only the solum but everything above this including air space and all that lies below the ground. The property rights bestowed on the owner are of course not absolute in the sense that they are restricted under both common law and statute in a number of ways and also subject to subordinate real rights which others may hold over the land. Aside from these exceptions, strict adherence to the doctrine would by definition mean that migratory things on land such as running water and fugacious minerals are the property of the landowner. As we shall see, however, this may not be the case.
3.2.1 The doctrine in England
The general thrust of the doctrine itself has been attacked, particularly south of the border, where it has been described as a 'fanciful phrase'.(16)^ Indeed operation of the doctrine appears to have been watered down significantly in England and Wales. This is probably in a large part due to the fact already alluded to that under English common law the issue of ownership is rarely a factor in determining whether a remedy will arise in any particular case. What is important is whether any legal rights of the landowner have been infringed - and such a right will exist only if there is a known remedy supporting it (and not the other way around). The common law does not exhibit any special remedies based upon ownership, therefore it would seem that other remedies (for example, in tort or in trespass) must be put forward by the aggrieved party.(17)
Most of the relevant cases where the doctrine is discussed relate to trespass or intrusion into airspace in some way by an adjacent landowner. These cases bear out the limited practical nature of the cujus est solum brocard in England and Wales. It seems according to these authorities that some sort of damage or injury must be proven before an action for trespass into airspace will be upheld and general doubt has been cast over the extent to which ownership can be held in a vertical limit up to the heavens.(18)
Although the case law is by no means consistent, it is arguable that the current situation under English law can perhaps best be summed up by Griffiths J in Bernstein v Skyviews and General Ltd :
The problem is to balance the rights of an owner to enjoy the use of his land against the rights of the general public to take advantage of all that science now offers in the use of air space. The balance is in my judgement best struck in our present society by restricting the rights of an owner in the air space above his land to such height as is necessary for the ordinary use and enjoyment of his land and the structures upon it, and declaring that above that height he has no greater rights in the air space than any other member of the public.(19) 3.2.2 The doctrine in Scotland
In contrast to the tenuous status of the doctrine south of the border, it would appear that it remains strong in Scotland. In Scotland, the doctrine cujus est solum arguably extends to airspace above the land without limit.(20)^ Unlike the
As a general point, the limitations placed upon the landowner's rights of property in such items which are situated on his land can be viewed as limitations on strict operation of the doctrine cujus est solum.
4.1 Property rights in running water in Scotland and England
4.1.1 General points under English law
Notwithstanding that there are certain rights in water which arise by virtue of ownership of riparian property, it has been asserted that flowing water, whether flowing in a known and defined channel or percolating through the soil in a random fashion is not the subject of ownership at common law.(28) The rationale underlying this is that water, in common with the air that we breathe, is a natural life-sustaining element common to all mankind.
In a similar manner to capturing a wild animal, water which has been appropriated or taken into possession either from a defined channel or from that percolating beneath the land is the subject of property, albeit only throughout the time of possession.(29)^ Similarly, water which is held in some sort of receptacle will be the property of the party who has possession of water, in so far as that possession endures.(30)
4.1.2 Riparian rights in England
Rights which, although falling short of full ownership, are proprietary in nature may vest in flowing water, however. In relation to streams which flow in a known and defined pathway, certain riparian rights exist. For example, at common law, a riparian although not able to draw away all the water, has certain rights: he has the sole right to fish in the water;(31)^ he has a right to the continual flow of water through the land, subject to the ordinary and reasonable use of the water by the upper riparian owners;(32)^ he has the right to take and use water for all reasonable domestic purposes(33)^ or perhaps in some cases manufacturing purposes even where this may result in the stream being exhausted;(34)^ and he has the right to draw water for extraordinary purposes provided that such use is reasonable(35)^ and the water is not substantially altered in volume or character.(36)
Known and defined channels may also exist underground and the same rules which apply to those channels above ground also apply to those below. The onus of proving that the channel is known and defined, however, will fall upon the person claiming the riparian rights. In the Irish case of Black v Ballymena Township Commissioners ,(37)^ Chatterton VC remarked:
The onus of proof is on the person claiming riparian rights and it lies on him to show that without opening the ground by excavation or having recourse to abstruse speculations of scientific persons, men of ordinary powers and attainments would know, or could with reasonable diligence ascertain, that the stream when it emerges into light comes from and has flowed through a defined subterranean channel.(38)
Such riparian rights have no role to play in the case of underground water which percolates in an unknown, random way. Landowners have no right to
replenishment of this source and thus an adjacent landowner can extract such water with no regard to the rights of others whose land dries up as a result of water failing to arrive there.(39)^ Furthermore, the motives behind one landowner's abstraction of the percolating water appear to be of no relevance. In Bradford v Pickles , where there was evidence of unscrupulous motives on the part of the party draining the water prior to it reaching an adjacent landowner's well - it was alleged this was done to force the sale of the land - the court found that this was irrelevant in finding no grounds of action for the defendant.(40)
4.1.3 Property rights and subterranean water in England
These above cases are often commonly cited in support of the general proposition that no property lies in underground water. There is confusion, however, in the interpretation of some of the cases often cited as authority for this proposition. This confusion may be of little surprise, however, given that the facts of these cases are often obscure and judgements not particularly sound.(41)
In fact, in Acton v Blundell , which concerned the right of a landowner to divert underground water away from the land of another,(42)^ the Lord Chief Justice expressed the view that 'the owner of the soil [has] all that lies beneath the surface; the land below is his property, whether it be solid rock, or porous ground, or venous earth, or part soil, part water ' (emphasis added). This obiter comment of the Lord Chief Justice in fact suggests that the landowner does have property in water percolating below his land as such water is pars soli. Campbell has cast doubt on this viewpoint, however, remarking that,
the context in which the dictum was expressed however was... the question whether the right to the enjoyment of an underground spring... was governed by the same rules of law as those which apply to and regulate a water course flowing on the surface.... [The Lord Chief Justice] was therefore addressing primarily the issue of the right to use the underground water and not the question of its ownership.(43)
It is submitted that such a view stretches what the Lord Chief Justice stated - his words, 'the owner of the soil has all that lies below the surface; the land [including the water] below is his property' seem fairly unequivocal to this writer. Nonetheless, Campbell's viewpoint that underground percolating water is res nullius is supported by the approach taken in Ballard v Tomlinson ,(44) where in determining whether a right to claim for the pollution of underground percolating water may arise, the court held that a claim could arise even though such water was res nullius.
Notwithstanding this view, support for the proposition that there is a right of property in underground percolating water can be found elsewhere. In Bradford v Pickles , A.L. Smith JA, set forth the proposition that '... an adjacent landowner has no property in or right to subterranean percolating water until it arrives underneath his soil... therefore no property or right of his is injured by the abstraction of the percolating water before it arrives under his land'.(45)^ Again this at least seems to imply that such underground water is the property of the landowner when it arrives beneath his land.
What amounts to 'running' is also open to question. Does 'running' necessarily entail it running in a known, defined way or is water percolating underground in a random or unknown fashion included within such a definition? The Encyclopaedia of Scots Law , for example, appears to agree with the traditional Reid/Bankton/Erskine viewpoint, when it states that 'running water is a res communis... the property of no-one'.(59)^ A little later, however(60), it states 'water not in any defined channel, but distributed over the surface or through the strata of soil is regarded as pars soli ; like minerals and everything else a coelo usque ad centrum , it is the property of the proprietor upon whose land it falls'.(61)
This viewpoint that there may be property in underground percolating water was followed by the court in Crichton v Turnbull .(62)^ This case concerned a disposition which attempted to convey the 'windmill, pump, well and water supply and piping' as separate tenements in a field which was to be retained by the landowner. In holding that a conveyance of a separate tenement of the water was not competent, Lord Moncrief viewed that percolating water was pars soli and could not therefore be conveyed separately from the land itself.(63)^ Such views relating to percolating underground water are influenced by English law in this regard and based upon the dictum of the Lord Chief Justice in Acton v Blundell (explained above).
4.2 Rights of property in fugacious minerals and other sub-soil
materials
Under both Scots and English common law, all mines and minerals that lie beneath the soil are the property of the owner of the solum , a coelo usque ad centrum .(64)^ The common law position as to fugacious minerals such as hydrocarbons has never been as clear-cut, however. Prior to the statutory intervention of 1934, which vested all petroleum on-shore rights in the Crown, it was unclear as to the extent and nature of property rights held in situ in petroleum reserves. Indeed, the government of the day argued that given the uncertainties which shrouded common law rights to petroleum in situ the drastic step of vesting such rights in the Crown was necessary to facilitate exploration.(65)^ Much debate centred at this time on whether it was possible to own such a fugacious mineral, in situ , or, given its vagrant characteristics, petroleum was (akin to perceptions relating to subterranean water(66)) merely res nullius until reduced into possession.
Given the fact that petroleum reserves (which includes oil and natural gas) have been vested in the Crown through statute, there is a dearth of judicial authority in the UK concerning the property rights that landowners hold in oil and gas deposits on their land. In light of a spate of US cases regarding rights of ownership in petroleum reserves, it seems prudent, however, to examine some of the common law theories of ownership that have developed Stateside. Additionally, a clutch of UK and Commonwealth cases dealing with fugacious and semi-fugacious minerals and other sub-soil properties may provide some guidance in this area.
4.3 US theories of ownership of hydrocarbons
Given the multi-jurisdictional character of the legal landscape in the US, it will hold few surprises that a number of different theories of ownership of hydrocarbons have been recognised there.
4.3.1 Hydrocarbons as res nullius
At the time of the first cases relating to property rights in hydrocarbons, the US courts found it difficult to reconcile traditional notions of ownership with a substance that moved of its own volition to and fro beneath the soil. Given the fact that it was perceived that only wild animals and running waters shared these vagrant characteristics, the courts were quick to draw analogies with such things and apply their interpretations of English common law relating to such issues to hydrocarbons.(67)^ Such analogies generally led to the result that a landowner would have no property in underground hydrocarbon deposits until the same was extracted and reduced into possession.(68)
It should be pointed out at this stage that the analogy drawn between hydrocarbons and water or animals, ferae naturae , is somewhat misleading and was fuelled by a misconception and lack of judicial knowledge concerning the nature of oil and gas in strata that prevailed at the time of these decisions. As is now widely recognised, neither the migratory and fugacious nature of water or the vagrant characteristics of wild animals can readily be attributed to hydrocarbons given that '[o]il and gas occur in essentially closed systems with possible ownership restricted to the owners overlying the reservoir'.(69) Moreover, until tapped these minerals do tend to remain relatively stable within a given reservoir.(70)
These early court decisions were very much rooted in a formalist legal theory. Such a formalist approach considers legal reasoning to be a deduction that proceeds from general rules established in previous cases. Where no similar cases in fact exist, the courts attempt to draw analogies to find relevant rules that can be applied.(71)
Today, the law relating to the ownership of oil and gas in most US states has developed since the early decisions and can now be divided into two main theories: first, a recognition of ownership of hydrocarbons 'in place' beneath the surface of the ground; and secondly, those that recognise no ownership in hydrocarbons in situ , only a qualified proprietary right to search for and reduce the same into possession.
4.3.2 'Texas theory'
The theory of absolute ownership, often referred to as 'Texas theory' on account of its origins, prescribes that the estate in petroleum reserves is a 'defeasible' or 'determinable' fee.(72)^ In what can be seen as strict adherence to the maxim cujus est solum ejus est usque ad coelum et ad inferos , the fee holder owns oil and gas to the same extent that he owns other, non-fugacious minerals.
4.3.3 Qualified ownership
minerals are pars soli and owned in situ. Whilst the position regarding underground percolating water is unclear and is plausibly best viewed as res nullius , it would appear that given the relatively stable nature of oil and gas, there is no reason why such hydrocarbons would not best be viewed as pars soli and hence owned in situ.
5. A law of capture?
In general terms, a law of capture would sanction the appropriation by an adjacent landowner of property which may either be the property of another person or is (albeit perhaps temporarily) present on the other party's land in some way. Thus, the physical act of capture is sanctioned by the law. Some cases also involve the idea of legal capture in the sense that the physical act of capture also implies the acquisition of ownership.
Whether capture is merely physical or physical and legal, the key point is that it involves human intervention and this should be contrasted with property passing by natural causes - for example, when a wild animal strays across a boundary or escapes and is caught by another, or when water runs freely from one tract of land to another.
It should be noted that in examining whether or not such a law of capture exists the issues which the court must determine may not always be the same. This is because in some cases, the value of the object itself which is being captured is the important factor (for example, hydrocarbons) - in other cases, the more likely practical issue is the consequence rendered by capture of the substance (for example, where the withdrawal of water causes adjacent land to subside).
5.1 The law of capture and occupatio
The idea of taking possession of and gaining legal title to corporeal moveable property is of course not a new one and the Roman doctrine of occupatio stipulated that anything capable of private ownership and not already owned could be acquired by taking possession of it.(78)^ It followed, therefore, that property in underground water or wild animals could vest in the first person to capture or contain such things. Under the classic Roman formulation, the doctrine of occupatio applied both to things which had never been owned and to those which had ceased to be owned. Although the doctrine of occupatio has been adopted by Scots law, the general rule is that it only sanctions the appropriation of things that have never had an owner.(79)^ Things which had been once owned but have since been lost or given up generally belong to the Crown.(80)
The key point to note about occupatio is that even under its Roman formulation it has never sanctioned the appropriation of things that are currently the property of another party. Hence, in relation to migratory things, where the thing is owned in situ then it follows that another party cannot draw that thing away and claim rights of ownership in it on the grounds of
occupatio. Once ownership of the migratory thing has been lost by the original owner, then (akin to the practical rule relating to wild animals) it may be appropriated by another under Scots law. It is hard to see, however, that Scots law would allow occupatio to occur when ownership is lost because of the act of the capturing party. For example, it is one thing for oil to migrate by natural causes to beneath the land of another; it is quite another for that oil to migrate because of the drilling activities of the other party.
The situation may of course be different in respect of things which are res nullius. Since these things have never been owned, the party who appropriates the same should be able to claim ownership on the grounds of occupatio even if they have been appropriated from beneath the land of another. While this may be relevant in cases relating to the appropriation of hydrocarbons, the underground water capture cases tend more to be concerned with the drying up of neighbouring land and it is doubtful in these cases whether the water is in fact reduced into possession by the party whose works draw the water away. Hence, the applicability of occupatio may not be a relevant factor here.
5.2 Water
5.2.1 England and Wales
While certain riparian rights regulate water running in a known, defined way entailing entitlement to a continual flow (subject to the rights of others to take water), it has been asserted that as a landowner has the absolute right to make use of water percolating under his land then he may do so even if this serves to capture water from beneath the lands of others which would not otherwise have been drawn away and that in this his motives in so doing are irrelevant.(81)^ While this may be so, the rationale behind this viewpoint has traditionally been based upon a clutch of early cases and it is the view of this writer that many of these early decisions have in fact been misunderstood.
The earliest decision in this respect is Acton v Blundell .(82)^ The headnote to this case would appear to be unequivocal as it reads that '[t]he owner of land through which water flows in a subterranean course, has no right or interest in it, which will enable him to maintain an action against a landowner, who, in carrying on mining operations in his own land in the usual manner, drains away the water from the first mentioned owner, and lays his well dry'.(83)
It is important to note, however, that this headnote does not in fact accurately describe the legal principle determined in this case. In Acton , the plaintiff supplied his cotton mill with water from an underground well. The defendant, on mining coal on his land, pumped water which had begun to build up in his mine in order to keep this structure dry. This action, however, also caused the plaintiff's well to dry up.
The Lord Chief Justice stated that '[t]he person who owns the surface may dig therein and apply all that is there found to his own purposes at his free will and pleasure, and that if, in the exercise of such a right, he intercepts or drains off the water collected from underground springs in his neighbour's well, this
Nonetheless, Counsel contended that the lack of property rights in underground water did not mean that there was no right to support of the water and averred that the maxim sic utere ut alienum non laedas applied. He pointed to dicta to this effect in North Eastern Railway Company v Elliot .(91) This argument was rejected by the Court, however. Cockburn CJ opined that '[a]lthough there is no doubt that a man has no right to withdraw from his neighbour the support of adjacent soil, there is nothing at common law to prevent his draining the soil, if, for any reason it becomes necessary or convenient for him to do so'.(92)^ This remark suggests that the law here is primarily concerned with the balancing of competing rights and implies that the absolute right to drain water takes precedence over the right of support.
Popplewell has been followed in more recent judgements including Langbrook Properties Ltd v Surrey County Council (1970 1 WLR 161) and Thomas v Gulf Oil Refining Ltd .(93)^ It was held in Langbrook that the plaintiffs had no cause of action either in nuisance or in negligence when the defendants, in draining water from their own land, as an incident to this, also drained away percolating water from the plaintiff's land. Although the defendant's actions caused the plaintiff injury, this was a case of damnum sine injuria. Again the case turned on the fact that there was no natural right of support in respect of underground water.(94)
Despite this right to drain water away from beneath an adjacent proprietor's land, there is some authority to suggest that if a landowner drains water percolating from beneath his land and this has the effect to conflict with the rights of others in a flowing stream (for example, to drain water away from that stream) then such an action may be prevented by the parties so effected. In the case of Grand Junction Canal v Shugar ,(95)^ Hatherley LC, overruling the judgement of Jessel MR, held that where a landowner's operations had the effect of draining off water which was flowing in a natural stream then he may be prohibited in so doing. At p. 488, he stated:
If you cannot get at underground water without touching the water in a defined surface channel, you cannot get it at all. You are not by your operations, or by any act of yours, to diminish the water which runs in the defined channel, because that is not only for yourself, but for your neighbours also, who have a clear right to use it, and have it come to them unimpaired in quality and undiminished in quantity.
This judgement has subsequently been interpreted in a very narrow sense, however. In what may appear a somewhat creative decision, Lord Alverstone in the case of English v Metropolitan Water Board (96)^ took the view that in Grand Junction Canal Lord Hatherley in fact ruled against the defendant's direct tapping of the stream by bringing his drain into immediate connection with it. His view in this respect was influenced by the opinion of Vaughan Williams LJ in Jordenson v Sutton, Southcoates and Drypool Gas Co where he said:
With regard to Grand Junction Canal Co. v Shugar it seems tolerably clear from the longer report of this case in the Law Times that Lord Hatherley treated the case as one in which there was a direct tapping of an overground stream flowing in a defined channel, and not merely a withdrawal of percolating underground water indirectly affecting the underground stream.
Whether this was in fact what Lord Hatherley intended - and it is doubtful from the facts of the case whether such a viewpoint is really sustainable - his general approach has been rejected in Scotland, however, on practical grounds as outlined below.
5.2.2 Scotland
In relation to whether or not underground water can be 'captured' from beneath another's land in Scotland, it appears that Scots law has been influenced by case-law south of the border. Ferguson, for example, points to the House of Lords decision in Chasemore v Richards as authority for the notion that water may be extracted from beneath another's land without any action lying. As this article has already pointed out, Chasemore should not be read as giving authority to this proposition although there is now ample other authority to suggest that this principle has been accepted into English law.(97)
There appears to be a paucity of cases in this area. As Lyall merely notes, '[t]he position may be the same in Scotland'.(98)^ One important case in this area is Milton v Glen-Moray Glenlivet Distillery .(99)^ In Milton , the court held that in relation to subterranean water, any water which percolates onto that land by natural causes may be intercepted and extracted by the owner of the land - it being no objection that the water has percolated from or on route to a stream or piece of land belonging to someone else.(100)
In Milton , a lower heritor of a stream brought an action against a higher heritor who sunk a well 12 feet from the stream to supply water to his distillery, which had the effect of drying up the lower heritor's land. While recognising that under Chasemore a landowner is entitled to freely appropriate subterranean water which would otherwise feed a stream, Counsel for the pursuer suggested that '[i]f it is proved that the well is fed in whole or in part by water which has once flowed in the stream the withdrawal of that water (even by percolation through the bed of the stream and thence through the intervening strata) is outside the principle in the case of Chasemore , and falls under the general rules which regulate the rights of riparian owners in rivers and streams'.(101)^ Counsel relied upon the English decision of Grand Junction Canal Co v Shugar which has been explained above.(102)
Pointing to the impracticality of such a position, Lord Hatherley's view was given short shrift in Milton by Lord Kyllachy (whose judgement was affirmed by the Inner House. He stated:
It does... appear to me that... his Lordship's decision... is extremely difficult to support
... or reconcile... with the principles laid down so authoritatively in the case of Chasemore v Richards. In the first place, the doctrine is not, in my judgement, a workable doctrine. Not to mention extreme cases... there is hardly, I should think, a coal or iron pit in this country which does not to some extent drain from the neighbouring strata and pump to the surface water that has at some time flowed in a neighbouring stream. Indeed I should think that the instances must be numerable in which mining operations quite sensibly affect the level of neighbouring watercourses. Similarly, there are, I should think, few systems of agricultural drainage... which do not, more or less, have a like result.(103)
underground water. It is possible, however, that if the court had been willing to hold that by virtue of the rule set out in the maxim a coelo usque ad centrum , such underground water was pars soli and hence the pursuer's property, then arguably a case could have proceeded on the basis of the misappropriation by the defenders of the pursuer's property.
5.3 The law of capture and hydrocarbons
As we have already noted, UK cases in this area are distinctly thin on the ground in this area. Nonetheless, in addition to English case-law, a smattering of Commonwealth cases and some American material can be referred to in an effort to establish some general principles.
5.3.1 USA guidance on hydrocarbons
The law of capture originated during the late 19th^ century USA oil boom. The seminal decision in this respect is the 1899 Supreme Court of Pennsylvania case of Westmorland and Cambria Natural Gas Co v De Witt .(109)^ In this case, the court, in affirming the existence of a law of capture, ruled that
[h]ydrocarbons, like wild animals but unlike other minerals, have the tendency and the power to escape, even against the will of its owner and to continue to be his property only while within the area subject to his control, but when they migrate to other areas or fall under the control of other persons, that title to the previous owner disappears Therefore possession of the land does not necessarily involve possession of the hydrocarbons. If someone drilling on his own land reaches the common deposit and obtains through those wells the hydrocarbons of neighbouring areas, the ownership of that oil and gas passes to whoever produced it.. .(110)
Following on from this decision, the subsequent case of Barnard v Monongahela Nat Gas Co (111)^ in a similar fashion afforded little protection for those whose oil was extracted from beneath their feet. In the opinion of the court, the only option available to concerned oil-men was to 'use it or lose it' and make haste drilling their own wells. It is important to place these court judgements within the context of the industry at the time. The decisions of these courts set out a rule of convenience to meet the energy needs of a growing nation. Without such a rule and any agreements between adjacent landowners, the oil simply could not have been extracted without incurring legal sanction.(112)^ As McIlvaine PJ noted in Barnard '[the law of capture] may not be the best rule, but neither the legislature nor the highest court has given us any better'.
In relation to ownership in situ , for example, it is recognised that given the fugacious nature of oil and gas, absolute ownership simply ceases if the oil and gas migrates.(113)^ This caveat goes so far as to sanction the 'capture' of hydrocarbons from beneath one tract of land caused by the lawful operations of an adjacent landowner. As the Supreme Court of Texas viewed,
[t]he rule is simply that the owner of a tract of land acquires title to the oil and gas which he produces from wells to his land, though part of the oil and gas may have migrated from adjoining lands. He may thus appropriate the oil and gas that have flowed from adjacent lands without the consent of the owner of those lands and without incurring liability to him for
drainage. The non-liability is based upon the theory that after drainage the title or interest of the former owner is gone.(114)
Many states have found, however, the absolute ownership theory untenable not only in relation to the question of how full ownership can vest in substances over which a landowner has neither possession nor control but also because the rule of capture is viewed as being anathema to this doctrine's central theme, in that if someone has ownership in a thing, how can a legal system sanction its appropriation by another without the owner's consent?' It has been argued that
[t]his result was contrary to the essential characteristic of ownership, viz., the right of an owner to follow and to re-acquire his property from one who has removed it without permission, and concluded that oil and gas are incapable of being owned apart from the rest of the land until actually reduced to possession, the right of the landowner being one to search for and produce such products.(115)
To sum up the position as it relates to hydrocarbons in the USA, it appears that whether or not hydrocarbons are viewed as being owned in situ , subject to a proprietary right to reduce into possession, or res nullius is not a relevant factor and legitimate drilling activities can lawfully appropriate hydrocarbons that have been drawn from beneath another's land regardless of property rights in situ .(116)
5.3.2 Commonwealth guidance - natural gas
Two of the most important Commonwealth cases relating to the capture of natural gas are U Po Naing v Burma Oil Company (117)^ and Boyrs v Canadian Pacific Railway (118). As we saw previously, the court rulings were not consistent as to the nature of property rights in the gas reserves in strata. As we shall see, however, the question of what property rights existed in the gas had no bearing on whether or not a law of capture would operate.
In U Po Naing , the court simply viewed that the gas was res nullius and hence belonged to no one until reduced into possession and therefore the first party acquiring the gas took title to it. In Boyrs , the court denied a claim for injunction where the respondents had been granted a lease to drill for oil. Notwithstanding that the plaintiff's 'cap of gas' at the top of the oil would be lost on extraction, their Lordships were not prepared to hold '... that the [oil company] is under an obligation to conserve the appellant's gas with the consequent denial of the right to recover the petroleum in the usual way'.(119) This judgement was arrived at despite the fact that it was accepted by the court that the natural gas could be owned in situ.
The most salient issue in Boyrs therefore is clearly not one of ownership but rather the balancing of rights. As their Lordships noted, '[t]he question is not whose property the gas is, but what means the respondents may use to recover their petroleum'.(120)^ The most important aspect of the judgement in terms of balancing the opposing rights of the applicants, however, seems to have been the fact that the respondents were the recipients of an express grant of the petroleum in respect of which it must be implied that there was a right to work
