J. Hiram Moore, Ltd. v. Greer
171 Oil & Gas Rep. 163, 48 Tex. Sup. Ct. J. 662, 172 S.W.3d 609 (2005)
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Rule of Law:
A deed containing both a specific description of property that the grantor does not own and a general "catch-all" description of all interests in a county creates an ambiguity as to the property conveyed, requiring extrinsic evidence to determine the parties' intent.
Facts:
- Mary Greer, her three sisters, and their widowed mother partitioned an 80-acre tract into four 20-acre tracts (1-4) in the I. & G.N. R.R. Survey No. 6, Wharton County.
- Each sister received title to the surface and minerals in one tract and one-fourth of a non-participating royalty interest in each of the other three tracts; Greer received Tract 3.
- Tracts 1 and 2, located in the Railroad Survey, were pooled in 1991 with other tracts in the adjacent Wm. Barnard Survey No. 14 to form the 350-acre SixS Freís Gas Unit, entitling Greer to 1/4 of the royalty from Tracts 1 and 2.
- In May 1997, Greer leased the minerals in Tract 3 to J. Charles Holliman, Inc.
- In September 1997, Greer executed a royalty deed to Steger Energy Corp., which specifically described land in the "MEDALLION OIL — SIXS FRELS UNIT" located in the "W M BARNARD #14 SURVEY."
- Greer owned no royalty interests in the Barnard Survey; her only royalty interests in the SixS Freís unit were in Tracts 1 and 2, which were in the Railroad Survey.
- The deed also included a general grant stating an intent to convey "all of grantors royalty and overriding royalty interest in all oil, gas and other minerals in the above named county or counties, whether actually or properly described herein or not."
- In December 1998, Kaiser-Francis Oil Co., a successor to Holliman, pooled Tracts 1-4 for production from the Greer #1 Well in Tract 3, leading to a dispute over royalties between J. Hiram Moore, Ltd. and Greer.
Procedural Posture:
- Mary Greer executed a royalty deed to Steger Energy Corp.
- Steger Energy Corp. subsequently sold twenty-five acquired interests, including the one from Greer, to J. Hiram Moore, Ltd.
- J. Hiram Moore, Ltd. sued Mary Greer to determine their respective rights regarding the disputed royalties.
- Mary Greer counterclaimed for declaratory relief, as well as rescission and reformation based on mutual mistake and fraud.
- J. Hiram Moore, Ltd. moved for summary judgment, contending it had acquired all of Greer’s royalty interests in Wharton County by purchasing her royalty deed to Steger.
- The trial court granted Moore’s motion for summary judgment and severed Greer’s claims for rescission and reformation.
- Greer appealed the summary judgment to the intermediate appellate court.
- The court of appeals reversed the summary judgment, holding that a "catch-all" clause is not effective to convey a significant property interest not adequately described or clearly contemplated.
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Issue:
Does a royalty deed containing a specific grant of land in a survey the grantor does not own, coupled with a general grant of all royalty interests in the county, create an ambiguity regarding the property conveyed, thereby precluding summary judgment?
Opinions:
Majority - Chief Justice Jefferson
Yes, a royalty deed containing a specific grant of land in a survey the grantor does not own, coupled with a general grant of all royalty interests in the county, creates an ambiguity regarding the property conveyed, thereby precluding summary judgment. The Court found the deed ambiguous because the specific description pointed to land in the Barnard Survey, where Greer owned no interest. Her actual royalty interests in the SixS Freís unit (Tracts 1 & 2) were in the Railroad Survey. This meant the specific description either conveyed nothing or incorrectly described Greer's interests. Coupled with the general grant purporting to convey all interests in Wharton County, the deed "in effect states that Greer conveys nothing, and that she conveys everything." Citing Smith v. Allison, the Court reasoned that such material inconsistent provisions render a deed uncertain as to the property conveyed, making it impossible to construe as a matter of law. Therefore, the trial court erred in granting summary judgment, and a jury must hear evidence to determine the parties’ intent.
Dissenting - Justice Owen
No, the royalty deed in question is unambiguous and should be given effect as written, conveying all of Greer's royalty interests in Wharton County. Justice Owen argued that the deed clearly purported to grant Greer’s interest in a specific section and also "all of Greer’s royalty interests in Wharton County, whether described in the deed or not." The deed itself anticipated that the specific grant might not "actually and properly describe[]" the interests. The dissent asserted that the Court should faithfully apply longstanding precedent giving effect to geographic grants, citing cases like Holloway's Unknown Heirs v. Whatley and Witt v. Harlan. It distinguished Smith v. Allison, contending that Smith involved a conflict between a specific grant of mineral interests and a general grant purporting to convey fee simple title, a repugnancy not present in Greer's deed, which consistently reflected an intent to convey only royalty interests. The dissent warned that the majority's decision would destabilize land titles and lead to increased litigation by ignoring the plain meaning of the deed.
Concurring - Justice Hecht
Yes, the Court's decision to find ambiguity is justified under the "hard cases make bad law" principle, as the unusual facts of this case prevent a rigid literal interpretation of the general grant. Justice Hecht acknowledged the dilemma: the specific grant described property Greer did not own, yet Greer claimed she intended to convey nothing. He recognized Moore’s argument for literal interpretation to maintain title certainty and Greer’s argument against overreaching general grants. While rejecting Greer's broader contention that general grants are always limited to small adjacent strips, he also stopped short of a blanket endorsement of Moore’s literal interpretation. Hecht found Smith v. Allison relevant, noting that in Smith, a general grant was not given unambiguous literal effect despite its terms, partly due to the vastly greater acreage it would have included. He concluded that while general grants should typically be given effect, this "unusual circumstance" warranted a finding of ambiguity without necessarily destabilizing land titles.
Analysis:
This case reinforces the principle that while courts generally seek to uphold the plain language of a deed, an inherent contradiction between a specific property description and a general "catch-all" clause can render the entire deed ambiguous. It highlights the Texas Supreme Court's cautious approach to "Mother Hubbard" or "catch-all" clauses, especially when the specific grant fails completely or points to property not owned by the grantor. The ruling emphasizes the importance of clear and accurate property descriptions in deeds and signals that ambiguous instruments may require extrinsic evidence and a jury's determination of intent, potentially increasing litigation and title uncertainty in complex conveyances.
