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Click here for the full text of this decision FACTS:Stewman Ranch Inc., O.T. Stewman and Helen Stewman (the Stewmans) conveyed approximately 8,900 acres by warranty deed to Double M. Ranch Ltd. The deed contained reservations for recorded oil, gas, and mineral leases and other recorded reservations of minerals and royalties. The deed also contained the following reservation: “There is, however, excepted and reserved to the Grantors an undivided one-half (1/2) of the royalties to be paid on the production of oil, gas and other hydrocarbons from the described lands which are presently owned by Grantors for and during the lives of Helen A. Stewman and O. T. Stewman, Jr.; and, upon the death of the survivor of them, this retained royalty interest will vest in Grantee, its successors and assigns.” The Stewmans did not own 100 percent of the royalty interests but, rather, owned undivided interests of varying amounts under the several tracts conveyed. Subsequently, a dispute arose between the parties regarding ownership of the royalties. The Stewmans contended they had reserved one-half of the total mineral interests under the property, while Double M. Ranch claimed that the reservation was of one-half of the royalty interests owned by the Stewmans at the time of the conveyance. By summary judgment, the trial court held that the Stewmans reserved one-half of the royalty interests owned by the Stewmans at the time of the conveyance rather than one-half of the total royalty. HOLDING:Affirmed. Double M. Ranch argues that this case can be resolved using the rule adopted in Duhig v. Peavy-Moore Lumber Co., 144 S.W.2d 878 (Tex. 1940). In that case, Duhig owned a tract of land and one-half of the underlying minerals. Duhig assigned the land by warranty deed. The deed purported to convey all of the surface and minerals, but it also contained a reservation to the grantor of one-half of the mineral estate. Peavy-Moore ultimately acquired the tract. A dispute arose between it and Duhig’s descendants over the ownership of the mineral estate. The parties agreed that one-half of the mineral estate was owned by a third party. Duhig’s descendants contended that the mineral reservation vested them with the remaining one-half. If correct, Duhig’s deed transferred no mineral interest despite the language of its granting clause. The Texas Supreme Court held that Duhig’s descendants were estopped from claiming any of the mineral estate and that Peavy-Moore owned the disputed one-half mineral interest. Double M. contends that the Stewmans are likewise estopped from taking their present position. Duhig is inapplicable to this case, because there has been no failure of title, the court concludes. Unlike Duhig, the Stewmans’ deed did not purport to convey title that the grantors did not own. The deed here specifically provided that it was subject to the exceptions and reservations contained in it, and those were set out in four paragraphs of the deed. Consequently, the title that the Stewmans warranted did not include any interest specifically excepted or reserved. The Stewmans argue that this issue can be resolved by determining whether the reservation refers to ���the described lands or the ���conveyed lands. The Stewmans’ argument is based upon a rule of construction developed from two decisions: Hooks v. Neill, 21 S.W.2d 532 (Tex. Civ. App. ��� Galveston 1929, writ ref’d), and King v. First Nat’l Bank of Wichita Falls, 192 S.W.2d 260 (Tex. 1946). This case does not fit within the rule developed by Hooks and King because of the unique language contained in the reservation. The difficulty lies with the inclusion of the words: ���which are presently owned by Grantors. Analyzing the grammar, the court holds that the clause ���which are presently owned by Grantors refers to and defines ���one-half (1/2) of the royalties and that the Stewmans reserved a life estate in one-half of the royalties that they owned at the time of the conveyance, not one-half of the total royalties. OPINION:Wright, C.J.; Wright, C.J., and Strange, J., and Dickenson, S.J.

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