James H. Davis D/B/A JD Minerals, Walter Allison Baen, Santos J. Dominguez and Dixie L. Hester v. COG Operating, LLC, Neal Brusenhan Properties, LP, Neal Brusenhan Management, LLC as General Partner of Neal Brusenhan Properties, LP, Robert L. Neal as Trustee of the Neal Robert L. Management Trust and Jessie Frances Neal ( 2021 )

ACCEPTED
08-20-00205-CV
EIGHTH COURT OF APPEALS
08-20-00205-CV EL PASO, TEXAS
4/28/2021 1:01 PM
ELIZABETH G. FLORES
CLERK
No. 08-20-00205-CV
FILED IN
IN THE COURT OF APPEALS FOR THE 8th COURT OF APPEALS
EIGHTH JUDICIAL DISTRICT, EL PASO, TEXAS EL PASO, TEXAS
4/28/2021 1:01:51 PM
__________________________________________________________________
ELIZABETH G. FLORES
Clerk
JAMES H. DAVIS d/b/a JD MINERALS, WALTER ALLISON BAEN,
SANTOS J. DOMINGUEZ AND DIXIE L. HESTER,
Appellants
v.
NEAL BRUSENHAN PROPERTIES, LP; NEAL BRUSENHAN
MANAGEMENT, LLC, AS GENERAL PARTNER OF NEAL
BRUSENHAN PROPERTIES, LP; ROBERT L. NEAL AS TRUSTEE OF
THE NEAL ROBERT L. MANAGEMENT TRUST;
JESSIE FRANCES NEAL; and COG OPERATING, LLC,
Appellees
Appeal from 112th District Court, Upton County, Texas
APPELLANTS’ REPLY BRIEF
LAW OFFICE OF FRENCH BENTON, PLLC
AUDREY MULLERT VICKNAIR Matthew French
Audrey Mullert Vicknair State Bar No. 24085314
State Bar No. 14650500 matt@frenchbenton.com
802 N. Carancahua Street, Ste. 2100 J.D. Benton
Corpus Christi, Texas 78401-0038 State Bar No. 24097369
(361) 884-5400; (361) 884-5401 fax jd@frenchbenton.com
avicknair@vicknairlaw.com 415 W. Wall Street, Ste. 1240
Midland, Texas 79701
LAURA H. BURNEY (432) 888-8996
State Bar No. 03437400
335 Geneseo Road Attorneys for James H. Davis d/b/a JD
San Antonio, Texas 78209 Minerals, Walter Allison Baen, Santos J.
(210) 431-2264; (210) 227-7924 fax Dominguez and Dixie L. Hester
lburney@lhburneylaw.com
i
TABLE OF CONTENTS
INDEX OF AUTHORITIES……………………………………………………….v
SUMMARY IN REPLY……………………………………………………………1
ISSUES PRESENTED, RESTATED
I. Applying controlling rules of deed interpretation, Appellants own a portion
of the Sessler NPRI.
A. The Duhig Doctrine does not deprive Appellants of their ownership of
the Sessler NPRI.
1.) Concord Oil and its progeny preclude the Neals’ reliance on the
two-grant doctrine to create their Duhig estoppel/estoppel by
deed argument.
2.) The 1939 Deed provides notice of the Haun conveyance (of one
interest -- a mineral interest), and excludes it from the grant.
3.) Grantee Roberts had actual and constructive notice of the
outstanding Haun interest from her pre-execution title opinion
produced by the Neals.
B. The “presumed grant” theory does not deprive Appellants of the NPRI
they own; no gaps in title exist or are alleged.
C. Appellants are not time-barred from benefitting from the NPRI they
own.
II. Because Appellants own the floating NPRI, fact issues exist as to whether
the Neals breached their executive duties (including by accepting royalty
attributible to the Sessler NPRI, self-dealing, failing to inform NPRI
owners of leases and royalties, and pressuring operators to ignore the
NPRI).
III. Appellants’ claims against the Neals that are ancillary to title can be
remanded for disposition by the trial court, as it does not appear the trial
ii
court addressed those claims on the merits; they were premature (the court
considered them to be “part 2” of the case). If this Court determines to
address those claims, Appellants here show that the various defenses
alleged by the Neals lack merit, and more than a scintilla of evidence
supports Appellants’ claims.
IV. Appellants’ claims against COG likewise need not be reached here, as the
trial court vacated the summary judgment entered in favor of COG, which
COG has not appealed. Further, the trial court does not appear to have
reached the claims ancillary to title on the merits; they were premature and
are the only claims against COG. But again, as a precaution, Appellants
show that more than a scintilla of evidence supports their claims against
COG, and COG’s defenses lack merit.
ARGUMENT……………………………………………………………………….4
I. The Neals Misrepresent the Language in the 1939 and 1926 Deeds and
Contradict Texas Supreme Court Authority Governing Deed
Interpretation……………….…………..……………………………..4
A. The language in the 1939 Deed precludes application of Duhig….4
B. The Neals mispresent the language in the 1926 Deed and the law
that governs its interpretation …………………………………….9
C. The Sesslers reserved a 1/4th floating NPRI in the 1939
Deed ……………………………………………………………..11
D. The Sessler NPRI burdens the Neals’ mineral
interest……………………………………..……………………..12
E. Conclusion as to Duhig ………………………………….……....14
II. The Passage of Time and the Presumed Grant Doctrine Cannot
Deprive Appellants of the NPRI They Own...………………………15
III. Ancillary Claims (Responsive to Neal Brief 35-53)……..………….17
IV. COG…….…………………………………………………………..19
iii
CONCLUSION AND PRAYER………………………………………………….20
CERTIFICATE OF COMPLIANCE……………………………………………...22
CERTIFICATE OF SERVICE…………………………………………………....22
iv
INDEX OF AUTHORITIES
CASES
Arnold v. Ashbel Smith Land Co., 307 S.W.2d 818(Tex. Civ. App.—Houston 1957, writ ref’d n.r.e.) ...............................................8
Concord Oil Co. v. Pennzoil, 966 S.W.2d 451 (Tex. 1998) ........................... ii, 2, 10
Duhig v. Peavy-Moore Lumber Co., 144 S.W.2d 878 (Tex. 1940) ................. passim
Fisher v. Wynn, No. 12-11-00008-CV, 2011 Tex. App. LEXIS 6031(Tex. App.—Tyler Aug. 3, 2011, no pet.) ............................................................8
French v. Chevron U.S.A., Inc., 896 S.W.2d 795 (Tex. 1995) ................................12
Greer v. Shook, 503 S.W.3d 571 (Tex. App.—El Paso 2016, pet. denied)............10
Harris v. Windsor, 294 S.W.2d 798 (Tex. 1956) ......................................................7
Hysaw v. Dawkins, 483 S.W.3d 1 (Tex. 2016) ........................................................12
Philipello v. Taylor, No. 10-11-00014-CV,
2012 Tex. App. LEXIS 3324 (Tex. App.—Waco Apr. 25, 2012, pet. denied) ....8
Temple-Inland Forest Prods. Corp. v. Henderson Family P’ship, Ltd.,
958 S.W.2d 183 (Tex. 1997) ..............................................................................12
Trial v. Dragon, 593 S.W.3d 313 (Tex. 2019) ............................................. 6, 7, 8, 9
Van Dyke v. Navigator Grp., No. 11-18-00050-CV,
2020 Tex. App. LEXIS 10448(Tex. App.—Eastland Dec. 31, 2020, pet. filed) ......................................... 16, 17
Wenske v. Ealy, 521 S.W.3d 791 (Tex. 2017) .............................................. 7, 12, 13
STATUTES AND RULES
Tex. Civ. Prac. & Rem. Code § 37.004(a) ...............................................................16
v
Tex. R. App. P. 43.2(c) ............................................................................................18
Tex. R. App. P. 43.2(d) ............................................................................................18
Tex. R. App. P. 43.3(b) ............................................................................................18
vi
TO THE HONORABLE EIGHTH COURT OF APPEALS:
COME NOW APPELLANTS James H. Davis d/b/a JD Minerals, Walter
Allison Baen, Santos J. Dominguez and Dixie L. Hester and file their Reply Brief,
seeking reversal of the trial court’s summary judgment orders and rendition of
judgment in their favor on the issue of title. In support, Appellants would show:
SUMMARY IN REPLY
Contrary to the Neals’ approach to this case, this Court cannot ignore the
clear language of the 1939 Deed, including its two references to the mineral interest
previously conveyed to Haun. Nor can this Court ignore long-standing precedent
controlling deed interpretation and the extremely limited application of the doctrine
the Neals claim “precludes” Appellants from their interest: the Duhig Doctrine.1
When the law is properly applied, this Court must hold the following: 1) the Duhig
Doctrine does not apply to this case; 2) the 1939 Deed reserved a 1/4th floating non-
participating royalty interest (NPRI) in the Sesslers (Appellants’ predecessors), and
that NPRI burdens the Neal Appellees’ mineral interest; and 3) Appellants have not
lost title to the NPRI through the “presumed grant” doctrine or statutes of limitation.
The law and the facts do not support the trial court’s judgment. The court should
have rendered judgment for Appellants, declaring that the mineral conveyance to
Roberts (the Neals’ predecessor) was and remains burdened by the Sesslers’
1
Duhig v. Peavy-Moore Lumber Co., 144 S.W.2d 878 (Tex. 1940).
1
reserved NPRI, a portion of which (equating to a 34/320th NPRI) now belongs to
Appellants.
In a confused and conflated argument that ignores the clear language in the
Deeds and settled deed interpretation precedent, the Neals devote most of their brief
to improperly claiming the Duhig doctrine “precludes” Appellants from benefiting
from their ownership of the Sessler NPRI. But the Texas Supreme Court has
confirmed that doctrine only applies when: 1) the deed at issue purports to reserve
the “exact” mineral interest the deed conveyed, and 2) the deed fails to reference a
prior mineral interest in the chain of title. Only when those facts appear -- because
both the reservation and the grant cannot be given effect (because the grantee would
be left with a smaller interest in the mineral estate than the grant conveys) -- a grantor
will lose the reserved mineral interest, pursuant to “the Duhig theory.” In this
dispute, the language of the 1939 Deed precludes application of Duhig: 1) the
Sesslers did not reserve any mineral interest in themselves, and 2) the Deed does not
fail to reference a prior mineral interest in the chain of title but rather expressly
references the prior mineral interest owned by Haun -- not once but twice.
To ply this dispute into Duhig, the Neals continue to ignore the seminal Texas
Supreme Court case of Concord Oil Co. v. Pennzoil, 966 S.W.2d 451 (Tex. 1998),
which rejects the Neals’ two-grant interpretation of the 1926 Deed. Under Concord
Oil, with that Deed the Sesslers conveyed a single 1/4th mineral interest to Haun in
2
the subject tract. The Neals fail to address Concord Oil and its progeny; their
interpretations of the 1926 and 1936 Deeds are wrong as a matter of law.
For all the Neals’ machinations, they simply cannot finagle the facts or the
law to force the Duhig doctrine into this dispute.
The Neals similarly distort the “presumed grant” theory, which only applies
in limited circumstances: when a gap appears in a claimant’s chain of title. Here,
Appellants claim their portion of the NPRI with an unbroken chain of title.
Appellants own a portion of the Sessler NPRI. There is no need to “presume” a
grant. That theory, like the Duhig doctrine, has no application to this dispute.
Finally, the Neals repeatedly and erroneously contend that Appellants’ claims
are barred by limitations. The Neals concede the fact that Appellants filed a trespass-
to-try title action (which the Neals admit has no statute of limitations) as well as a
declaratory judgment action. Regarding the latter, Appellants acquired their interests
in late 2017 and early 2018 and brought suit within months to have their rights
declared and protected. Moreover, as Appellants demonstrated in their brief, statutes
of limitation do not bar Appellants’ declaratory request asking this Court to interpret
the unambiguous deeds as a matter of law.
Appellants pray the Court to hold, as the Deeds establish and the law requires,
that the mineral conveyance to Roberts was and remains burdened by the Sesslers’
reserved NPRI, a portion of which (equating to a 34/320th NPRI) now belongs to
3
Appellants. Appellants are entitled to the benefits of that ownership. The trial court’s
summary judgment must be reversed, and judgment rendered for Appellants
proclaiming they own a portion of the NPRI burdening the subject property.
Appellants’ tort and ancillary claims against the Neals should be remanded for trial,
where their claims against COG await. In the event the Court addresses breach of
executive duty (and other ancillary claims), Appellants have established that fact
issues exist.2
ARGUMENT
I. The Neals Misrepresent the Language in the 1939 and 1926 Deeds and
Contradict Texas Supreme Court Authority Governing Deed Interpretation
All parties agree the interpretation of the 1939 Deed controls this dispute. All
parties agree the 1939 Deed is unambiguous, meaning this Court can construe it as
a matter of law. Appellants have asked this Court to interpret all the plain terms of
the 1939 Deed (and the 1926 Deed that came before it) pursuant to Texas Supreme
Court authority governing the deed interpretation process. To accomplish their goal
of negating the NPRI, the Neals ignore the clear language of the Deeds and Texas
Supreme Court precedent.
A. The language in the 1939 Deed precludes application of Duhig
The Neals misrepresent the 1939 Deed in their Statement of Facts, claiming
2
See Ant Br 52: Appellees suppressed payment of the Sessler NPRI despite multiple
operators holding title opinions mirroring Appellants’ deed construction (CR2151-52).
4
the Sesslers reserved a “royalty” interest that had been previously conveyed: “By the
terms of the 1939 Warranty Deed [the grantors the Sesslers] attempted to reserve a
¼ royalty interest from the conveyance to [grantee Roberts] but this ¼ royalty
interest had previously been conveyed to W. H. Haun in the 1926 Royalty Deed….”
(Ee Br 1) (emphasis added). Throughout their brief, the Neals continue to misstate,
in a variety of ways, the interest previously conveyed to Haun in 1926, the interest
the Sesslers reserved in themselves in 1939, and the interest the Sesslers conveyed
to Roberts in 1939 (e.g., Ee Br 5, 6-7, 9, 12, 14, 21, 26).
The Sesslers did not reserve in themselves an interest previously conveyed.
Rather, first, the 1939 Deed references the prior conveyance of a mineral interest
(not a royalty interest) to a named individual, Haun: “It is understood, however, that
1/32 of the oil, gas and other minerals has heretofore been conveyed to W. H. Haun,
and this conveyance does not include such mineral interests so conveyed;” later the
Deed states again, “…subject to the mineral interest hereto-fore conveyed to W. H.
Haun….” (CR CR1229-1230, Ant Br App. C) It is objectively false to say that
“There is no exception or mention in the 1939 Warranty Deed of a prior conveyance
of a … mineral interest” in the 1939 Deed (Ee Br 9).
Second, the 1939 Deed unequivocally reserves an NPRI, not a mineral
interest, in the Sesslers.
In truth, the 1939 Deed conveyed to Roberts the surface of the described tract
5
(Section 45, Block 40, T-5-S, T&P Ry Co, Upton County, Texas) and all the
minerals the Sesslers owned in that tract: an undivided 3/4th mineral interest. The
Sesslers had previously conveyed 1/4th of the minerals to Haun in 1926 (CR1221-
22, 1223-24, Ant Br App. B3).
The 1939 Deed does not fit the criteria required for the Court to apply Duhig.
As the Neals concede, the Duhig doctrine only applies when the deed at issue (1)
conveys property by warranty deed, (2) “reserves a mineral interest in the grantors,”
and (3) “fails to except mineral interests reserved in prior recorded deeds” (EE Br
6). The 1939 Deed reserves an NPRI, not a mineral interest in the Sesslers; grantee
Roberts received all the minerals in the tract that the grantor Sesslers owned; and the
Deed contains not one but two references to the prior conveyance of a mineral
interest to Haun (CR1229-1230).
Moreover, in 2019, the Supreme Court continued a decades-long trend of
criticizing and narrowing the 1940 ruling in Duhig (see Ant Br 12, n. 8). In Trial v.
Dragon, the Court confirmed, “Duhig applies the doctrine of estoppel by deed to a
very distinct fact pattern, and its holding is narrow and confined to those specific
facts.” Id., 593 S.W.3d at 318 (emphasis added) (Ant Br 6-7, 12-14, 15, 18, n. 8, 9).
That fact pattern requires a showing that 1) the deed reserves the exact mineral
3
The Neals make much of the fact that the 1926 Deed is titled “Royalty Deed” (e.g., Ee Br
1, 3, 4, 5, 9, 28). As Appellants have established, it is the substance, not the title, that
governs (Ant Br 25, n. 20).
6
interest the deed purports to convey (not here); and 2) the deed lacks a reference to
a deed conveying an undivided mineral interest in a third party (not here) (id.). The
Neals cannot escape this clear holding or the extensive list of authorities showing
the very limited applicability of Duhig (Ee Br 14-18).
To avoid Trial, and the original Duhig holding, the Neals falsely assert that
the Sesslers’ reservation of a “royalty” interest triggers Duhig (EE Br. 13: “Duhig
applies to royalty interests, and the Texas Supreme Court has recognized the
grantees interest should be protected,” citing Wenske v. Ealy, 521 S.W.3d 791 (Tex.
2017)). No case, including Wenske, has ever expanded Duhig to a deed reserving
an NPRI as opposed to a reservation of a mineral interest purported to be conveyed
(see, e.g., Ant Br n. 8). Notably, the deed at issue in Wenske did not invoke Duhig,
the parties did not argue Duhig, and the majority opinion never mentions the Duhig
doctrine. Wenske, 521 S.W.3d at 791-800.
Next, the Neals attempt to ignore the express exception of the Haun mineral
interest in the 1939 Deed by arguing the reference must include the phrase “for all
purposes.” (Ee Br 19) No such requirement appears in Duhig or in cases analyzing
Duhig. Indeed, contrary to the Neals’ discussion of Harris v. Windsor, 294 S.W.2d
798 (Tex. 1956), Harris stands in a long line of cases refusing to apply Duhig when
a deed includes any reference to an outstanding interest, as here. Id. at 801 (see Ant
Br n. 8, 9). The deed at issue in Duhig made no reference to any prior reservation
7
of a 1/2 mineral interest in the conveyed property, while purporting to reserve an
undivided 1/2 mineral interest in the grantor (leaving the grantee with less interest
than granted). Accord, Philipello v. Taylor, No. 10-11-00014-CV, 2012 Tex. App.
LEXIS 3324, **25-28 (Tex. App.—Waco Apr. 25, 2012, pet. denied) (holding deed
put grantee on notice of prior conveyance and outstanding interest, without reference
to “for all purposes”).4
Contrary to the Neals’ assertions, Appellants do not seek to change the law
(Ee Br 22), they seek to apply long-standing precedent to the Deeds at issue in this
case. As such, ultimately, Duhig does not and cannot apply: the 1939 Deed conveyed
all the minerals the Sessler grantors owned (an undivided 3/4th mineral interest), with
no reservation of a mineral interest in the Sesslers. The Deed further contains two
exceptions referencing the prior conveyance of the mineral interest to a named
individual – Haun. The Deed does not fit the Duhig requirements. The Sesslers,
their heirs and assigns (including Appellants) cannot be stripped of the NPRI
4
The Neals then attempt to invoke inapplicable canons of construction and inapposite case
law to force this dispute into Duhig (Ee Br 21-22, referencing “exceptions strictly
construed against the grantor,” and “greatest estate conferred on grantee”). Both canons
are subordinate to harmonization principles and are employed only if doubt remains. Fisher
v. Wynn, No. 12-11-00008-CV, 2011 Tex. App. LEXIS 6031, *17 (Tex. App.—Tyler Aug.
3, 2011, no pet.) (citing Arnold v. Ashbel Smith Land Co., 307 S.W.2d 818, 824 (Tex. Civ.
App.—Houston 1957, writ ref’d n.r.e.)). The Deed language is clear, and the directly
applicable law is clear. Case law does not support stripping NPRI ownership through
application of the “greatest estate” canon of construction.
8
expressly reserved in the 1939 Deed under the Duhig doctrine. Instead, as the Texas
Supreme Court explained in Trial, the only remedy available would have been for
Roberts, as grantee in the 1939 Deed, to seek damages for breach of warranty (Ant
Br 13). Trial, 593 S.W.3d at 319. There is no dispute Roberts sought no such remedy.
B. The Neals misrepresent the language in the 1926 Deed and the law
that governs its interpretation
The Neals assert Duhig controls this dispute but state Duhig applies only if
this Court interprets the 1926 Deed as having conveyed two interests to Haun: one
interest in the mineral estate and a second they repeatedly label as a “royalty” (Ee
Br passim). As Appellants demonstrated in their brief, because the 1926 Deed
conveyed a single 1/4th mineral interest to Haun, under the Appellees’ own
argument, the Duhig doctrine does not apply (Ant Br 15-18, 20-26). The Court can
end its inquiry here.
The Neals wrongly assert, without supporting authority or analysis, that the
1926 Deed conveyed not one interest but two: a 1/4 royalty to Haun and a separate
1/32 mineral interest (Ee Br pp. 4, 11, 14, 18, 24, 26, 27). Citing Texas Supreme
Court precedent, Appellants thoroughly debunked that interpretation, and the Neals
offer no substantive response to the law (Ant Br 20-26). The Neals fail to even cite
Concord Oil, 966 S.W.2d 451, let alone discuss the lengthy precedent that case
established discrediting the two-grant theory the Neals improperly employ to
misinterpret the 1926 Deed. Unlike the Neals, this Court in prior decisions has
9
embraced rather than ignored Concord Oil. Greer v. Shook, 503 S.W.3d 571, 583
(Tex. App.—El Paso 2016, pet. denied) (recognizing Concord’s rejection of two-
grant interpretation of multiclause deed form). Moreover, like the deed in Concord
Oil, the 1926 Deed is devoid of language indicating the intent to convey two
disproportionate interests (See Ant Br 23).
Concord Oil further contradicts the Neals’ claim that the “estate
misconception” and “legacy of the 1/8th royalty” only apply when the issue is
whether the deed conveys a fixed or floating royalty (because of “double fractions”)
(Ee Br 25-26). Concord Oil applied the “estate misconception” when interpreting a
mineral deed that did not involve “double fractions;” also, no party argued the
multiclause deed in that case created a NPRI. The Court used the “estate
misconception” to interpret and “harmonize” the conflicting fractions (1/96th in the
granting clause, “1/12th of rents and royalties” under existing and future oil and gas
leases) to interpret the deed as having conveyed a single 1/12th mineral interest
(1/96th representing the share of production owed to the owner of a single 1/12 th
mineral interest when oil and gas leases contained the once common 1/8 th
landowner’s royalty [1/12 x 1/8 = 1/96]) (see, Ant Br 21-24).
Honoring Texas Supreme Court precedent and the plain language of the 1926
Deed from the Sesslers to Haun, that Deed must be interpreted as having conveyed
a single 1/4th mineral interest: the fraction used in the granting clause, 1/32nd, reflects
10
the share of proceeds from production owed when oil and gas leases contained the
once common 1/8th lease royalty (1/4 x 1/8 = 1/32nd).
The estate misconception likewise explains and harmonizes the 1939 Deed’s
reference to the Haun Deed as a 1/32nd mineral interest when it actually conveyed a
1/4th mineral interest. The owner of a 1/4th mineral interest would receive, as a matter
of law, a 1/32nd share of the proceeds of production (Ant Br 24-26).
But, critical here, regardless of the appearance of the fraction 1/32nd rather
than 1/4th, the two express references to Haun’s prior mineral interest in the chain of
title precludes application of Duhig to this dispute.
C. The Sesslers reserved a 1/4th floating NPRI in the 1939 Deed
Because the 1926 Deed conveyed only a single mineral interest to Haun, the
1939 Deed references only that mineral interest (twice). As Appellants have shown,
the 1939 Deed also reserved to the Sesslers a floating 1/4th NPRI. Instead of properly
identifying that interest as an NPRI, the Neals state the Sesslers “attempted” to
reserve a royalty interest (Ee Br 1). Indeed, the Sesslers reserved in themselves a
1/4 floating NPRI: “It is further understood and agreed that we reserve unto
ourselves our heirs and assigns, one-fourth (1/4) of the 1/8 royalty usually reserved
by and to be paid to the land owner in event of execution of oil and gas leases…,”
and again excepting “the 1/4th royalty interest reserved by us as hereinbefore
stated….” (CR1221-22, 1223-24 [Ant Br App. B]; Ant Br 18-19: interpreting Sessler
11
reservation under Hysaw v. Dawkins, 483 S.W.3d 1 (Tex. 2016)).
To avoid the plain language of the 1939 Deed (and the 1926 Deed), the Neals
conflate and confuse the “royalty” reserved in oil and gas leases with the distinct
interest owners of mineral estates (like the Sesslers) can create in themselves through
their deeds: a NPRI. As Texas Courts have consistently recognized, a NPRI differs
from the conveyance or reservation of a mineral interest and is distinct from the
“royalty” owed a landowner pursuant to the terms of an oil and gas lease. Hysaw,
483 S.W.3d at 9 (recognizing a floating NPRI depends on landowner’s royalty
percentage in oil and gas leases); Temple-Inland Forest Prods. Corp. v. Henderson
Family P’ship, Ltd., 958 S.W.2d 183, 185–86 (Tex. 1997) (interpreting deed
reservation as creating NPRI not mineral interest when construing the deed as a
whole); French v. Chevron U.S.A. Inc., 896 S.W.2d 795, 798–98 (Tex. 1995)
(clarifying differences between deeds that create NPRI rather than mineral interest).
As Appellants made clear in their opening brief, the Sessler reservation created a
floating NPRI (Ant Br 18-19).
D. The Sessler NPRI burdens the Neals’ mineral interest
The Neals falsely claim Duhig fits the facts of this dispute to achieve their
goal of unburdening their minerals from the Sessler NPRI. But as a matter of law
when the Sesslers conveyed their 3/4th mineral interest to Roberts in 1939, those
minerals were burdened by the NPRI reserved by the Sesslers in the same Deed.
12
Wenske, 521 S.W.3d at 797-98 (confirming that an NPRI created by a mineral owner
burdens the minerals owned by that grantor).
In Wenske, the Wenskes owned a tract of land in Lavaca County, Texas they
received through a 1988 warranty deed that conveyed the surface and all the minerals
beneath the tract to the Wenskes, but the grantor reserved a 1/4th NPRI. In 2003, the
Wenskes executed a warranty deed to the Ealys, conveying all the land but expressly
reserving an undivided 3/8th mineral interest. Thus, the Ealys received a 5/8th interest
in the minerals. Id. at 793. That 2003 deed also expressly referenced the NPRI owned
by the Wenskes’ grantor (in the 1988 deed), placing the grantees on notice that the
minerals were burdened by the NPRI. Id. at 796. The parties did not dispute that
the NPRI burdened the entire mineral estate when the Wenskes owned it. The issue
was whether the 2003 deed contained sufficient language to require the Ealys to bear
the entire burden of the NPRI, rather than their proportionate share. Id. at 793-94.
Applying its precedent requiring courts to seek the parties’ intent by
examining all language in a deed, the Supreme Court held that standard clauses in
the deed did not alter the burden of the prior NPRI. Wenske, 521 S.W.3d at 797
(interpreting “subject to” clauses in deed form and holding those standard clauses
did not address the burden of a prior NPRI). That is, the prior NPRI continued to
burden the entire mineral estate, because the grantor who reserved the NPRI had
13
owned 100 percent of the minerals when the NPRI was reserved.5
Here, the Sesslers owned 3/4ths of the minerals (1/4th having been conveyed
to Haun in 1926) when they conveyed the surface and those minerals to Roberts
through the 1939 Deed. That same Deed reserved the NPRI in the grantors. Thus,
the mineral conveyance to Roberts was and remains burdened by the Sesslers’
reserved NPRI, a portion of which (equating to a 34/320th NPRI) now belongs to
Appellants. The effect of the burden is to reduce the Neals’ share of payments from
their lessees’ sales of oil and gas produced from the subject tract. The Neals cannot
avoid that burden, under the plain language of the Deeds and binding Texas
precedent.
E. Conclusion as to Duhig
To strip Appellants of their NPRI which burdens the Neals’ interest in the
subject property, the Neals rely first on the Duhig doctrine and assert that the Sesslers
“over-conveyed” mineral and royalty interests to Roberts, thereby dispossessing the
Sesslers (Appellants’ predecessors) of the NPRI they reserved in themselves. As
shown above, for all the Neals’ machinations, they simply cannot make Duhig apply.
There was no over-conveyance. The Duhig doctrine does not apply. Therefore,
Appellants cannot be deprived of their interest under that theory. To the extent the
5
Once the minerals were owned in cotenancy, the cotenants’ interests were burdened with
their proportionate share of the prior NPRI. Id. at 798 (holding 3/8th mineral interest
retained by grantor remained proportionately burdened by pre-existing NPRI).
14
trial court ruled otherwise, the court’s summary judgment must be reversed, and
judgment should be rendered for Appellants. Appellants own a portion of the NPRI
the Sesslers reserved in themselves in the 1939 Deed. That NPRI burdens the 3/4
mineral interest conveyed to Roberts in the same Deed.
II. The Passage of Time and the Presumed Grant Doctrine Cannot Deprive
Appellants of the NPRI They Own
The Neals state, ad nauseum, that Appellants are time-barred from bringing
their claims to title.
First, the Neals acknowledge that Appellants alleged a trespass to try title
claim, and that no statute of limitations applies to that claim (Ee Br 8, 32, CR388,
393 [acknowledging trespass to try title is proper claim], 567-68 [alleging limitations
as to every claim except trespass to try title]).
Second, the Neals present no additional briefing about limitations as relates to
Appellants’ declaratory judgment action. Appellants fully briefed the multitude of
legal principles that permit their DJA claim (Ant Br 28-32), and Appellees present
no substantive response (Ee Br 34-35). Indeed, Appellees simply parrot precisely
what they said in the trial court, stating in but one sentence that limitations applies,
relying on a statute and a case the Appellants showed clearly did not support
Appellees’ position (Ant Br 30, Ee Br 34-35, CR567-68). As for the references to
leases recorded in 2005 (Ee Br 35), Appellants did not obtain their interests until
2017 and 2018, then filed suit within months (as the Neals acknowledge, Ee Br 2).
15
It was not until Appellants acquired their interests that they had a justiciable interest
in the controversy; it was only then that they were “persons interested under a deed”
who could “have determined any question of construction or validity arising under
the instrument … and obtain a declaration of rights, status, or other legal relations
thereunder.” Tex. Civ. Prac. & Rem. Code § 37.004(a). While the Sesslers may not
have availed themselves of this relief, the Neals present this Court with no authority
establishing that Appellants are precluded from doing so. The Neals have presented
nothing new to the Court. Limitations does not bar Appellants’ claims to title.6
Regarding presumed grant (Ee Br 7-8, 30-31), the evidence is clear:
Appellants have a clear, unbroken chain-of-title to the Sessler NPRI (Ant Br 26-28).
The Neals’ and the Appellants’ abstracts of title are virtually identical. Appellants
stand on their briefing which establishes the presumed grant/presumed lost deed
doctrine is inapplicable: both parties have produced unbroken chains of title, and
there are no gaps in title (id.).
This is purely a deed interpretation dispute. A recent case, issued after
Appellants filed their opening brief, supports this position: Van Dyke v. Navigator
6
Appellants note that the Neals do not contend, in their brief, that laches applies to
Appellants’ title claims but instead focus that defense on Appellants’ “tort” claims (Ee Br
8, 35, 37-39). They did the same in the trial court, and only asserted laches as to unjust
enrichment and constructive trust (CR561). In an abundance of precaution, Appellants fully
briefed the inapplicability of laches to their title claim (Ant Br 31-32, including that laches
does not apply to trespass to try title and the Neals have in no way been disadvantaged here
– they continue to reap the entire royalty benefits from the subject property).
16
Grp., No. 11-18-00050-CV, 2020 Tex. App. LEXIS 10448, at *15-18 (Tex. App.—
Eastland Dec. 31, 2020, pet. filed). The Eleventh Court reiterated that presumed
grant typically only applies where gaps in the chain of title appear. On the other
hand, when the quanta of interest conveyed is at issue and can be determined by
interpretation of a deed (similar here) “…the presumed grant doctrine may not be
used to reinterpret [the deed] and therefore alter its unambiguous terms.” Id. at * 17
(emphasis added). The Neals cannot rely on the presumed grant doctrine here
because there are no gaps in the chain of title.
III. Ancillary Claims (Responsive to Neal Brief 35-53)
With respect to Appellants’ ancillary claims (which the Neals refer to as “tort
claims,” Ee Br 35-53), as clearly stated in Appellants’ opening brief, all these claims
are dependent on the Court’s determination as to title. Appellees now acknowledge
that various of Appellants’ claims are “premature and not ripe” because title has not
been established in Appellants (see, e.g., Neal Ee Br 40-41 [breach of fiduciary duty,
breach of the duty of good faith and fair dealing, tortious interference]; 50 [asserting
no constructive trust because no fiduciary relationship]). Tellingly, Appellees state
in their Brief, “As with all of Appellants’ tort claims, the trial court determined that
the Appellants could assert no torts as they did not own the disputed NPRI.” (id. 51)
These admissions directly contradict the Neals’ earlier contention that
Appellants rely on “a single statement” by the Neals’ counsel below to support their
17
position that the trial court did not reach their ancillary claims (id. 35-36). Appellees
are well aware the trial court did not reach these claims, as Appellants have clearly
shown (with far more than one quote from opposing counsel in support): the trial
court saw this case as having “two parts” – title being the first part, the ancillary
claims being the second. The Neals have now confirmed that fact.
If the Court reverses the trial court’s order and holds that Appellants hold title
to a NPRI burdening the subject property, then Appellants pray the Court to remand
all their ancillary claims for disposition by the trial court. The Court may reverse the
trial court’s judgment in part and render the judgment the trial court should have
rendered as to title, and remand the remainder of the claims for further proceedings.
Tex. R. App. P. 43.2(c), (d). The interests of justice support such a remand of these
ancillary claims to the trial court for disposition, particularly when the court was
clear about his rulings in the case. Tex. R. App. P. 43.3(b). If Appellants do indeed
own title to a portion of this NPRI, the trial court should have the opportunity to
consider these ancillary claims in light of that ruling.
Alternatively, Appellants have clearly, and extensively, argued the law and
the record regarding their ancillary claims and why summary judgment could not
have been granted. Genuine issues of material fact exist to permit the trier of fact to
decide those issues. The law supports recovery in favor of Appellants on these
claims. If this Court reverses on title, the Court should also reverse as to all of
18
Appellants’ attendant claims.
IV. COG
As for COG, in its Brief, COG agrees that all claims against it “have been
severed into a separate lawsuit and abated by the trial court” and “there is no final,
appealable judgment.” (Ee Br iv, v, 2, 3) COG confirms the severed case is
“currently pending.” (Ee Br 1, 2) COG also agrees that title must be determined
first, and COG is not a party to the title dispute – Appellants and the Neal Appellees
are the parties whose title must be determined (EE Br iv). All claims against COG
are ancillary.
COG laments that it is a named party to this appeal. COG was a named
defendant in the trial court’s “Final Summary Judgment” (CR2310-11). Appellants
filed a notice of appeal from that order and this appeal ensued. That is why COG is
named in this appeal.
However, as COG notes, the trial court (while it still had plenary power)
severed COG from the main proceeding and abated that new case (CR2336-28). The
court then simultaneously lifted the abatement and set aside and vacated the order
granting summary judgment as to COG (Supp.CR9-10). Appellants’ claims against
COG remain pending in that new case, as COG now concedes. Appellants could not
know what COG’s position would be with respect to the trial court’s various actions,
so Appellants preserved their rights to seek appellate relief, as necessary, in the trial
19
court and on appeal. Ultimately, COG filed neither a motion in the trial court
challenging the court’s actions nor a notice of appeal. And COG does not complain
of the trial court’s actions here.
Appellants have made their position as to COG clear in their brief: assuming
COG made no attempt to challenge the trial court’s actions on appeal, Appellants’
claims against COG need not be reached here (Issue Presented No. 4). COG now
agrees Appellants’ claims against it remain pending below.
For the reasons stated here, COG’s “plea to the jurisdiction” is misplaced; the
Court need not diverge into a jurisdictional argument. COG should not be “dismissed
from the appeal.” And the Court cannot “affirm the trial court’s summary judgment
orders below” as COG posits (Ee 4).
Rather, Appellants pray the Court to reverse the order of the trial court that
grants summary judgment to the Neal Appellees regarding title and hold that
Appellants are indeed the record owners of an NPRI burdening the property at issue.
Appellants’ claims against COG will be tried below accordingly.
CONCLUSION AND PRAYER
This is not a Duhig case. Presumed grant does not apply. Two-grant
interpretation is no more. The Neals contort the Deeds and the caselaw to conjure a
result. The trial court improperly granted summary judgment to the Neals. This
Court can correct the fundamental errors of law applied below and must do so to
20
avoid an unprecedented shift in oil and gas jurisprudence.
Appellants pray the Court to REVERSE the trial court’s summary judgment
orders and RENDER judgment in part in their favor, holding Appellants hold title to
the NPRI at issue, or otherwise remand this issue for further proceedings
commensurate with the Court’s analysis. Appellants pray the Court to REMAND
the balance of their claims, including for attorneys’ fees, which are all ancillary to
title, to the trial court for disposition on the merits. Appellants pray for all other relief
to which they are entitled.
Respectfully submitted,
/s/ Audrey Mullert Vicknair
Audrey Mullert Vicknair
State Bar No. 14650500
Law Office of Audrey Mullert Vicknair
802 N. Carancahua, Suite 2100
Corpus Christi, Texas 78401
(361) 884-5400; (361) 884-5401 (fax)
avicknair@vicknairlaw.com
Laura H. Burney
State Bar No. 03437400
335 Geneseo Road
San Antonio, Texas 78209
(210) 431-2264; (210) 227-7924 fax
lburney@lhburneylaw.com
Matthew French
State Bar No. 24085314
matt@frenchbenton.com
J.D. Benton
State Bar No. 24097369
jd@frenchbenton.com
French Benton, PLLC
415 W. Wall St., Suite 1240
Midland, Texas 79701
(432) 888-8996
Attorneys for Appellants
21
CERTIFICATE OF COMPLIANCE
This brief contains 5,197 words according to the word processing program
utilized to create the brief, from “Summary in Reply” through the end of the Prayer.
Text size is 14-point font in the body and 13-point in the footnotes.
/s/ Audrey Mullert Vicknair
Audrey Mullert Vicknair
CERTIFICATE OF SERVICE
I, the undersigned attorney, certify that a true and correct copy of the
foregoing Appellants’ Brief was served in accordance with the Texas Rules of
Appellate Procedure on April 28, 2021:
David W. Lauritzen
dlauritzen@cbtd.com
Emily E. Brown
ebrown@cbtd.com
COTTON, BLEDSOE, TIGHE & DAWSON
Joe Baker
SCHEEF & STONE
jbaker@solidcounsel.com
David W. Wallace
wallacesonora@qmail.com
WALLACE LAW OFFICES
Ken Slavin
ken.slavin@kempsmith.com
KEMP SMITH LLP
ATTORNEYS FOR THE BRUSENHAN & NEAL DEFENDANTS
Len A. Wade
lwade@jw.com
Allison B. Allman
aallman@jw.com
JACKSON WALKER LLP
ATTORNEYS FOR COG OPERATING LLC
/s/ Audrey Mullert Vicknair
Audrey Mullert Vicknair
22
Automated Certificate of eService
This automated certificate of service was created by the efiling system.
The filer served this document via email generated by the efiling system
on the date and to the persons listed below. The rules governing
certificates of service have not changed. Filers must still provide a
certificate of service that complies with all applicable rules.
Audrey Vicknair
Bar No. 14650500
avicknair@vicknairlaw.com
Envelope ID: 52913988
Status as of 4/28/2021 2:38 PM MST
Associated Case Party: COG Operating LLC
Name BarNumber Email TimestampSubmitted Status
Nicole Burkholder nburkholder@jw.com 4/28/2021 1:01:51 PM SENT
Sherri Goodwin sgoodwin@jw.com 4/28/2021 1:01:51 PM SENT
Alli Allman aallman@jw.com 4/28/2021 1:01:51 PM SENT
Case Contacts
Name BarNumber Email TimestampSubmitted Status
Jonathan Benton 24097369 jd@frenchbenton.com 4/28/2021 1:01:51 PM SENT
David Wayne Lauritzen 796934 dlauritzen@cbtd.com 4/28/2021 1:01:51 PM SENT
Matthew French 24085314 matt@frenchbenton.com 4/28/2021 1:01:51 PM SENT
Joseph Baker 24058547 joe.baker@solidcounsel.com 4/28/2021 1:01:51 PM SENT
Audrey Vicknair 14650500 avicknair@vicknairlaw.com 4/28/2021 1:01:51 PM SENT
Ken K. Slavin 18496100 kslavin@kempsmith.com 4/28/2021 1:01:51 PM SENT
Laura H. Burney 3437400 lburney@stmarytx.edu 4/28/2021 1:01:51 PM SENT
Len Allen Wade 20635050 lwade@jw.com 4/28/2021 1:01:51 PM SENT
David Warren Wallace 20765200 wallacesonora@gmail.com 4/28/2021 1:01:51 PM SENT
Greta Duran greta.duran@kempsmith.com 4/28/2021 1:01:51 PM SENT
Mitzi Shannon mitzi.shannon@kempsmith.com 4/28/2021 1:01:51 PM SENT