Requirement 14.009 – Construction of Mineral Reservation (Duhig)

Top  Previous  Next

Requirement 14.009 – Construction of Mineral Reservation (Duhig)

 

 Desauque Mineral Reservation.  By warranty deed dated February 14, 1986, and recorded in Deed Book 455, page 16, Francis L. Desauque conveyed Tract 1 and other lands to Charles Despallier.  The description in the deed contained the following mineral reservation:

 

Mineral and mining right excepted, (one-fourth interest).

 

 At the time of the conveyance, Desauque owned an undivided one-fourth mineral interest in Tract 1.  The effect of the mineral reservation will depend upon whether a court determines that the parenthetical “one-fourth interest” qualified the phrase “mineral and mining rights excepted.”  If the parenthetical “one-fourth interest” qualified the entire reservation, the deed would stand as a full warranty deed purporting to pass an undivided three-fourths interest in the mineral estate.  Such a construction would have placed Desauque in breach of his title warranties, and would have passed all his interest in the mineral estate to Despallier. Duhig v. Peavy-Moore Lumber Co., 144 S.W. 2d 878 (Tex. 1940); Martin v. Knight, 275 So.2d 117 (Ala. 1973); Morgan v. Roberts, 434 So.2d 738 (Ala. 1983); Cole v. Minor, 518 So.2d 61 (Ala. 1987).  If the phrase “mineral and mining rights excepted” had some other meaning, Desauque may have kept his one-fourth mineral interest in Tract 1.

 

 Other documents in the abstract indicate that both Desauque and Despallier have acted as if Desauque kept the one-fourth mineral interest and Despallier acquired only the surface interest.  For example, Alamo Oil and Exploration, Inc., has leased Desauque’s one-fourth mineral interest in Tract 1 and other lands three times since February 14, 1986, the date of the deed to Despallier.  Alamo Oil and Exploration has completed two producing wells on other lands conveyed to Despallier by the February 14, 1986, deed.  Despallier negotiated surface damage releases for the drill sites for those wells.  In those surface damage releases, Despallier indicated that he claimed only the surface estate and none of the mineral interest underlying his surface estate.

 

 Despite the conduct of the parties after the February 14, 1986 deed, there is a risk that the technical wording of the Desauque - Despallier deed did not represent the intent of the parties and possibly could create a windfall of the Desauque one-fourth mineral interest to Despallier.

 

 In our ownership tables for Tract 1, we have shown that Charles Despallier owns the one-fourth mineral interest in Tract 1 formerly owned by Francis L. Desauque.  You have acquired oil, gas, and mineral leases only from Francis L. Desauque.

 

 Requirement:

 

(1)Prior to drilling an oil and gas well on Tract 1 or on lands pooled with Tract 1, obtain an oil, gas, and mineral lease from Charles Despallier.

 

(2)If you obtain oil and gas production from Tract 1, obtain from Francis L. Desauque and Charles Despallier a recordable deed with cross grants clarifying their mineral ownership interests in Tract 1.  If Desauque and Despallier will not join in such a deed, you should deposit into the registry of a court of competent jurisdiction any royalty proceeds attributable the disputed interests and interplead their potential claims.

Copyright 2011 by Edward G, Hawkins. All rights reserved.