Face Challenges Confidently

312 Houchins v. Devon Energy Prod. Co.

Monday, August 31st, 2015

Richard F. Brown

 
The following is not a legal opinion. You should consult your attorney if the case may be of significance to you.
 
Houchins v. Devon Energy Production Co., No. 01-08-00273-CV, 2009 WL 3321406 (Tex. App.—Houston [1st Dist.] Oct. 15, 2009, pet. denied) (mem. op.), held that language in a deed stating that the grantor retains mineral rights and exempts them from conveyance is an effective reservation of mineral rights regardless of its placement within the warranty clause. Grantor alleged that he reserved the mineral rights under a clause that stated “[t]o the extent that Grantor maintains any mineral rights to the subject property, Grantor expressly retains such mineral rights and exempts same from the conveyance herein.” Grantee argued that the clause was not a reservation of the mineral interests, but rather an exception to Grantor’s warranty of title. Grantee contended that the location of the clause within the warranty clause listing other exceptions to title was indicative of the nature of the clause as an exception to the warranty rather than a reservation of the minerals.
 
The court dismissed Grantee’s argument by stating that “[r]ather than focusing on characterizing the deed language at issue as an ‘exception’ or a ‘reservation,’ our primary objective in construing a deed is to determine the intent of the parties from the four corners of the deed.” The court examined the entire deed in order to give effect to all provisions, “so that none will be rendered meaningless.” The court concluded that the clause was sufficiently clear to reserve a mineral interest, and its effectiveness was not undercut by the location of the clause within the deed.
 
The significance of the case is the clear holding that a mineral reservation will be given effect, regardless of its location within the deed, even if it is found within the warranty clause.