What if a Partition Deed Doesn’t Consider the Minerals?

Originally published by Charles Sartain.

Posted by Charles Sartain

Did Moses worry about the mineral rights when he parted the Red Sea?  Maybe Charlton Heston knows. What we know is that 3,500 years later if you plan to partition surface rights, the time to pay attention to the minerals is now.

In Hosek v. Scott, the parties had a deed partitioning the surface estate of 338.54 acres in Atascosa County, Texas. The partition deed said:

“This partition does not include any of the oil, gas and other, minerals in, on or under the [land], and same are to remain undivided for a period of [25] years from date hereof and as long thereafter as oil, gas or other minerals are produced in paying quantities from the [land].”

The question

Did the minerals revert to the owners of the surface estates after the period lapsed during which partition of the minerals was prohibited?

After the partition Hosek owned 207.77 acres (except 38.5 owned by Scott) and Scott owned 130.77. Scott conveyed the 38.5 acres to Hosek subject to the reservation of all minerals reserved in the partition deed.

Scott argues: Since the minerals were never partitioned he continues to own an undivided half interest in minerals under the Hosek tract.

Hosek responds:  The meaning of the deed is ambiguous and thus a fact issue exists.  The language intended that the undivided mineral interests revert to the surface owners after the expiration of 25 years and cessation of production.

Are there two reasonable interpretations of the partition deed?  If so, we need a trial. If not, judgment for Scott.

(I’ll skip the rules of contract construction that you’ve seen in this space before).

The answer

The minerals did not “revert” to the surface owner at the end of the 25 years. The deed expressly excluded minerals from the partition and the deed does not have language stating that the minerals would be partitioned at the end of the 25 years. Accordingly, Hosek’s interpretation would require the court to add language to the partition deed.  That, the court is not permitted to do.

The court ruled that the partition deed can be given a definite and certain meaning as a matter of law and is therefore unambiguous. The parties’ intent is expressed in the four corners and restricted partition of the minerals for the 25 years. At the end of that period, the restriction was lifted and the parties had the unrestricted right to partition the minerals, or not. They did not partition the minerals after the end of the 25 year restricted period. Scott wins.

I’m breaking my promise …

… never to write on climate change because the subject is too politicized. But this, from the announcement following the Paris climate change conference is too good to ignore:

“Also request the Subsidiary Body for Scientific and Technological Advice to undertake a work programme under the framework for non-market approaches to sustainable development referred to in Article 6, paragraph 8, of the Agreement, with the objective of considering how to enhance linkages and create synergy between inter alia, mitigation, adaptation, finance, technology transfer and capacity-building, and how to facilitate the implementation and coordination of non-market approaches.”

This 66-word morass of abstractions is what we’ve come to expect from bureaucrats, and it dismisses free markets for … what?  Here is Forbes‘ take on it. Michael Lynch says only a lawyer would love it. I object; that monstrosity is an insult to lawyers.

In honor of our special guest Moses we wish you Happy Holidays.

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