I had half of a divided interests in 160 acres in La Salle County that was sold 1999. It was our understand and the buyers understanding that we conveyed 1/2 of the minerals we owned. Now that there is activity on the place, we find that the deed reserved 1/2 of one owner but did not reserve any of the other owners minerals. Instead of retaining 1/4 of minerals we retained 1/8 and the new owner received 3/8. The land has been resold and so there are several other royalty owners that do not want to lose any of their mineral rights. Is there any legal action I can take against the lawyer that wrote the deed incorrectly?
Todd,
I took the liberty of looking at the two deeds dated 1999 in the online public records of La Salle County, and they raise a couple of questions. The first deed was from you and a relative, individually, to a Trust, and reserved nothing to either of you. Then the second deed is from the Trust to a third party, and contains what might be considered ambiguous language, based on my experience analyzing and interpreting Texas oil and gas title opinions issued by title attorneys. It's in the reservation clause: "...in addition to all valid mineral and royalty interest in said land previously reserved or conveyed..." then goes on to reserve the 1/2 interest. Duhig Rule comes to mind here, that one cannot reserve more than what will allow the full amount of stated conveyance to occur. Here, it is NOT clear that the Grantors intended to convey 1/2 of the mineral rights (either alone, or with surface rights--depends on what the Grantors owned at the time of the conveyance). It can be interpreted to mean that the Grantees received only whatever fraction of mineral rights were available after the Grantors' 1/2 reservation is added to "...all valid mineral and royalty interest in said land previously reserved or conveyed..." I have seen language just like this create a title requirement in numerous title opinions over the years. The cure in those opinions has ranged from requiring a correction deed to getting a stipulation of interest signed by all parties having possible present claim to any portion of the interest at issue. Only a Texas oil and gas title attorney can make a legal judgment concerning this particular language in this particular deed, so I'm only sharing my history of past experience.
One thing is clear from the reservation clause, that the 1/2 interest reserved is an executory mineral interest, and not merely a royalty right because of the language "...in and to...the...oil, gas and other minerals in and under and that may be produced from..the...land". As a professional division order analyst, I am trained to interpret that language as a mineral right reservation, meaning the current owner of this reservation has the right to negotiate and sign oil, gas, and mineral leases and share in the bonus and rentals, and to receive a royalty from the lease. I am also trained to interpret that clause as reserving 50% of 100% of all oil, gas, or minerals that come out of the ground--not just 50% of whatever the Grantor owned at the time of the conveyance. The Grantor would need to own at least 50% of 100% at the time of the conveyance in order for the Duhig Rule to not apply. I couldn't find what is known as a "proportionate reduction" clause in the deed, which I infer to mean the Grantors owned 100% of the mineral rights at the time they signed this deed.
But the two passages raising red flags for me are:
1. "...in addition to all valid mineral and royalty interests...previously reserved or conveyed, as may appear of record..." Was this language inserted because the Grantors knew that previous invalid reservations/conveyances had taken place? And some or all of them might have been legally delivered but never recorded into the deed records? And the inclusion of the words "...and royalty interests..." imply that there may have been royalty rights conveyances out of the mineral rights creating what is known as non-participating royalty interests in the land? That would definitely add the complication that the mineral rights ownership itself would not be reduced by an NPRI conveyance, but the royalty distributed to the mineral rights owner out of it would be reduced by deduction of the NPRI portion. Could this be why you are being credited with only 1/8th instead of 1/2 of the lease royalty?
2. The statement at the end of the reservation clause also is problematic for me as a D/O analyst: "...in no event, by warranty, estoppel or otherwise, shall Grantees or Grantees [sic.] successors in interest acquire any part of said interest as a result of this conveyance." This is the language that would actually cause me to bump this deed up to our in-house legal department to ask if they interpret it to mean that the Grantors might have knowledge of adverse claim against their ownership being asserted in this deed. If it's possible there could be a title dispute, customary oil company policy requires all of the royalties being claimed through a deed like this one to be put in suspense until whatever adequate title curative is done by the owner(s). No one would be paid until the dispute is settled in writing and recorded.
Based on everything I have offered here, I very strongly recommend that you (together with all others sharing ownership through this same problem deed with you) hire a competent attorney with expertise in oil and gas real property rights. La Salle County is part of Eagleford, but there are even more (deeper) formations being reviewed for possible exploration over the next few years in that part of Texas. Technology is driving the oil industry at high speed right now. An investment today in your title curative could pay off exponentially in the future.
Marsha Breazeale, M.Ed., CDOA, CPLTA