Oil and Gas Lawyer Blog
In March, the Texas Supreme Court decided James H. Davis, Individually and d/b/a JD Minerals, and JDMI, LLC v. Mark Mueller, No. 16-0155. (Davis v. Mueller) The Court construed a mineral deed to JD Minerals covering interests in Harrison County. The deed described particular interests owned by the grantor and then added the following:
The “Lands” subject to this deed also include all strips, gores, roadways, water bottoms and other lands adjacent to or contiguous with the lands specifically described above and owned or claimed by Grantors. If the description above proves incorrect in any respect or does not include these adjacent or contiguous lands, Grantor shall, without additional consideration, execute, acknowledge, and deliver to Grant[ee], its successors and assigns, such instruments as are useful or necessary to correct the description and evidence such correction in the appropriate public records. Grantor hereby conveys to Grantee all of the mineral, royalty, and overriding royalty interest owned by Grantor in Harrison County, whether or not same is herein above correctly described.
The particular tract descriptions were vague and not sufficient to satisfy the statute of frauds. So the issue was whether the deed conveyed anything. JD Minerals contended that the last sentence quoted above was sufficient to convey all interests owned by Grantor in Harrison County, even if all other descriptions in the deed were not sufficient under the Statute of Frauds. The Supreme Court agreed with JD Minerals. It agreed that the particular descriptions were too vague to convey anything, but it followed the Texas rule that a “blanket” conveyance of all of the grantor’s property a named county (or indeed in the State of Texas) is sufficient to convey all property owned by the grantor in the county. The fact that this sentence was in the same paragraph as the Mother Hubbard clause of the deed did not make it ambiguous.
James Davis, under the name JD Minerals, is a mineral buyer who has been in business in Texas for many years. He makes unsolicited offers to mineral owners to buy their interests. His solicitations describe particular mineral or royalty interests owned by the recipient and make a cash offer to buy those interests. The letter includes a deed and offers to pay if the recipient signs and returns the deed. But the deed contains the blanket conveyance sentence quoted above and therefore conveys all mineral interests of the grantor, not just the ones described in the solicitation letter. The solicitation and deed are therefore very misleading and have caught may recipients unawares.
Mineral owners should never sign conveyances without first having them reviewed by an attorney.