pjc-oil-and-gas-2024-lib

PJC 313.26

D AMAGES

If commingler fails to prove fractional share in question. If commingled goods are so confused as to render the mixture incapable of proper division according to the preexisting rights of the parties, “the loss must fall on the one who occasioned the mix ture.” Humble Oil & Refining Co. , 508 S.W.2d at 818; see, e.g. , Mooers , 204 S.W.2d at 608 (approving application of the “commingling rule” to base damages on entire com mingled mass of oil produced from different leases that was “impossible to unscram ble”); Holloway Seed Co. v. City National Bank , 47 S.W. 95, 97 (Tex. 1898) (commingler of seed and grain who cannot point out his own goods “must bear the loss which results from it”). Analogously, where a trustee wrongfully mixes trust funds with his own and cannot distinguish his funds from those of the beneficiary, the entire commingled fund becomes subject to a trust in favor of the beneficiary. See, e.g. , Logan v. Logan , 156 S.W.2d 507, 510–11 (Tex. 1941) (this rule “is analogous to that of confusion of goods”); Eaton v. Husted , 172 S.W.2d 493, 497–99 (Tex. 1943); In re Mittelsted , 661 S.W.3d 639, 651 (Tex. App.—Houston [14th Dist.] 2023, orig. pro ceeding). Instructing jury on damages. If it is determined that there has been a willful commingling that has shifted the burden of proof, and the commingler fails to prove the fractional share in question, the measure of damages may vary depending on the nature of the dispute and the claims at issue. In that instance, the court should instruct the jury on an appropriate measure of damages. See, e.g. , Dorchester Gas Producing Co. v. Harlow Corp. , 743 S.W.2d 243, 254–56 (Tex. App.—Amarillo 1987, writ dism’d by agr.) (jury found, in three separate issues, that commingling occurred, the volume of gas commingled, and damages for conversion of that volume). Given the range of possible fact patterns and disputes to which such questions could apply, this Comment does not propose the particular wording of such questions or instructions. The Committee also does not specify any fact patterns or disputes to which the confusion of goods theory would apply beyond those set out in the case law.

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