RER Ventures, LLC and RER Kalvest Investments, LLC v. Softvest, L.P. — Opinion by Justice Palafox
RER Ventures, LLC and RER Kalvest Investments, LLC v. Softvest, L.P. — Opinion by Justice Palafox
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COURT OF APPEALS EIGHTH DISTRICT OF TEXAS EL PASO, TEXAS ———————————— No. 08-24-00303-CV ———————————— RER Ventures, LLC and RER Kalvest Investments, LLC, Appellants v. SoftVest, L.P., Appellee On Appeal from the 112th District Court Upton County, Texas Trial Court No. 22-03-U4924-OTH OP I N I ON This appeal focusing on deed interpretation asks whether a nonparticipating royalty interest (NPRI) in one tract of a multi-tract oil-and-gas lease also carries the right to royalties from production on the other tracts in the lease. We conclude it does, and we affirm.
2 I. BACKGROUND Although the parties’ dispute centers on a 2010 deed, our reading of that instrument is informed by the broader chain of title, which traces ownership and related interests from 1951 to 2022. The NPRI at issue was created and conveyed in a 1951 deed from A.L. Attaway, grantor, to Mary D. Currie, grantee. Currie’s NPRI burdens the south half of Section 116, Upton County, Texas. In 1954, the mineral estate owners executed a mineral lease covering the tract and additional acreage in Sections 12 and 40.1 Currie ratified the lease in 1959. The same year, Currie conveyed the NPRI to J.H. Crouch. In 2002, Crouch conveyed all his mineral or royalty interests in the United States to a family trust. In 2007, the trustee conveyed the same interests to a different family trust, the Ranch 76 Trust. In 2010, the Ranch 76 Trust conveyed all its mineral and royalty interests in the south half of Section 116 1 The 1954 lease covers the following described land in Upton County: All of Section 12, Block 41, T-5-S, T&P RR Company Survey, Certificate No. 3481, containing 659 acres, more or less; the North one-half (N/2) of Section 40, Block 40, T-5-S, T&P RR Company Survey, Certificate No. 3353, containing 327.5 acres, more or less; and the South one-half (S/2) of Section 116, Block D, CCSD&RGNG RR Company Survey, Certificate No. 798, containing 322.38 acres, more or less.
3 to AOG Mineral Partners, Ltd. AOG then conveyed 87.5% of its interests to SoftVest in a deed with similar terms and the same effective date. The current lessee, Endeavor Energy Resources, then drilled productive wells in Section 12. In 2022, four days before this lawsuit was filed, the Ranch 76 Trust executed a quitclaim of any royalty interest it may have retained in Sections 12 and 40 to Appellant RER Ventures, LLC. RER Ventures then assigned that interest to Co- Appellant RER Kalvest Investments, LLC. RER Ventures sued SoftVest for a declaratory judgment with respect to the parties’ rights to the NPRI on both Sections 12 and 40, and for money had and received from revenue on production from Section 12. Both sides moved for summary judgment on the construction of the deeds. RER Kalvest was added as a plaintiff on the money-had-and-received claim. The trial court denied RER Ventures’ motion, granted SoftVest’s traditional and no-evidence motion for summary judgment in its entirety, and dismissed all claims against SoftVest. RER Ventures and RER Kalvest (together, RER) jointly appealed. II. STANDARD OF REVIEW AND APPLICABLE LAW The parties agree this case involves the construction of unambiguous instruments, presenting a question of law that we review de novo. See Wenske v. Ealy, 521 S.W.3d 791, 794 (Tex. 2017). In reviewing competing motions for summary judgment, we consider the evidence presented by both sides, determine all questions presented, and render the judgment the trial court should have rendered. FM Props. Operating Co. v. City of Austin, 22 S.W.3d 868, 872 (Tex. 2000); see Tex. R. Civ. P. 166a. When construing an unambiguous deed, “our primary duty is to ascertain the intent of the parties from all of the language within the four corners of the [instrument].” Wenske, 521 S.W.3d at 794. “We afford contract language its plain, grammatical, and ordinary meaning unless doing
4 so ‘would clearly defeat the parties’ intentions’ or the instrument shows the parties used the terms in a different or technical sense.” Nettye Engler Energy, LP v. BlueStone Nat. Res. II, LLC, 639 S.W.3d 682, 690 (Tex. 2022). As a limitation, “[w]e cannot employ surrounding facts and circumstances to make contract language say something it unambiguously does not or to determine ‘that the parties probably meant, or could have meant, something other than what their agreement stated.’” (quoting URI, Inc. v. Kleberg Cnty., 543 S.W.3d 755, 757 (Tex. 2018)). “Rather, the ‘facts and circumstances can only provide context that elucidates the meaning of the words employed, and nothing else,’ and they can only give contract language a meaning to which it is ‘reasonably susceptible.’” Nettye Engler Energy, 639 S.W.3d at 690. III. ISSUES ON APPEAL RER presents two issues on appeal. First, it contends the deed at issue2 limits SoftVest to royalty on production from the tracts the deed describes, which includes Section 116 but not Sections 12 and 40. Second, it contends the same result follows from the common-law rule of non- apportionment and the cross-conveyance doctrine. Overall, RER seeks reversal and remand; while SoftVest seeks affirmance of the trial court’s take-nothing judgment. Because the two issues present the same underlying question, we address them together. IV. DISCUSSION This appeal requires us to decide whether a deed that conveys royalties in production from a list of tracts—and the list omits Sections 12 and 40—evidenced an intent to convey a royalty interest, nonetheless, in the enumerated tracts as well as in Sections 12 and 40. 2 The parties base their analysis on the 2010 conveyance from the Ranch 76 Trust to AOG. AOG subsequently conveyed 87.5% of the same interest to SoftVest and 2.5% to Wade P. Koehl by deed with the same operative language and effective date. Because AOG is not a party, we refer to the deed at issue as the “SoftVest deed.”
5 We begin with greater detail about our method of construing the deed to ascertain and effectuate the parties’ intent. We are guided by the Texas Supreme Court’s approach to a similar question in Wenske, 521 S.W.3d at 792. There, the deed mentioned an outstanding NPRI but the language did not say whether the royalty burdened the grantor’s reserved interest or burdened the grantees’ interest instead. Id. at 793. The court of appeals in Wenske had held that because the deed provided “no guidance” on how to allocate that burden, the “default rule” of proportional sharing of the burden applied in the circumstance. Id. at 795. On petition for review, the Supreme Court affirmed the result but faulted the court of appeals for turning too quickly to a default rule to decide the case. Id. at 795. The Court distinguished two kinds of rules. It disfavored “mechanical, arbitrary, and arcane rules, which at one time offered certainty at the expense of effectuating intent,” but had since become “relics of a bygone era.” Id. at 792, 798. In their place, the Court instructed that courts should look to “established background principles of oil-and-gas law” as a more reliable guide for ascertainment of parties’ intent. Id. The Court explained that “parties who draft agreements rely on the principles and definitions pronounced by [the state’s highest court]” and “rightly depend on [it] for continuity and predictability in the law, especially in the oil-and-gas field.” Id. The Court then held that the NPRI burdened the parties in proportion to their mineral interests, in accord with a “basic principle of mineral conveyance,” that is, both benefits and burdens of a mineral interest pass with the interest in proportion to ownership unless the parties plainly express a different intent. Id. at 797. Notwithstanding this principle, the Court still emphasized that, when construing an instrument, the parties’ intent, plain or not, must be determined first by means of a “careful and detailed examination of a deed in its entirety” (emphasis added). Id. at 792, 795–96, 798.
6 The lesson of Wenske is that the deed’s text comes first, background principles second, and default rules, if ever, are only relevant as a last resort. We follow that approach here. A. The granting clause We begin with the granting clause of the 2010 deed. For ease of discussion, we divide this clause into identified portions bracketed by numbers from 1 to 3 and italicize phrases most highly disputed by the parties. [Grantor AOG Mineral Partners, Ltd.] . . . conveys . . . to . . . [Grantee SoftVest, LP] . . . Ninety percent (90%) of Grantor’s rights . . . [1] in the oil, gas, and other minerals in and under, and that may be produced from or pooled with the following described lands, [2] together with all of Grantor’s interest in all leasehold interests, royalties and overriding royalties payable out of production from the lands situated in Upton County, Texas, as described below: [3] SEE ATTACHED EXHIBIT “A” (emphasis added). We address each numbered portion in turn. (1) “Pooled with” (the first part) Focusing on the first portion of the granting clause, it describes the interest conveyed: [1] in the oil, gas, and other minerals in and under, and that may be produced from or pooled with the following described lands, SoftVest contends the phrase “or pooled with” clearly extends the grant to royalty from the entire area covered by the community lease, or Sections 12, 40, and 116. The premise of SoftVest’s argument is that “pooled with” and “leased with” are synonymous. Standing on that premise, we disagree with SoftVest’s interpretation of the granting language. “Pooled” is a term of art referring to joinder of tracts under multiple prior leases by a common lessee, and in some cases by the Railroad Commission. Key Operating & Equip., Inc. v. Hegar, 435 S.W.3d 794, 798 (Tex. 2014). A lessee may pool acreage only in accord with the purposes and methods specified in each lease—typically, to prevent waste or to meet Railroad Commission rules pertaining to well spacing and density. Se. Pipe Line Co. v. Tichacek, 997
7 S.W.2d 166, 170 (Tex. 1999); Hegar, 435 S.W.3d at 798 (recognizing that pooling is “one method to prevent waste”); R.R. Comm’n of Texas v. Opiela, 681 S.W.3d 397, 407 (Tex. App.—Austin 2023), vacated by agr., No. 23-0772, 2025 WL 351569, at *1 (Tex. Jan. 31, 2025).3 Thus, in accord with established industry usage, “pooled” has a different meaning from “leased together.” SoftVest cites Ruiz v. Martin, 559 S.W.2d 839, 842 (Tex. App.—San Antonio 1977, writ ref’d n.r.e.), for the proposition that ratification of the 1954 lease “constituted actual pooling” of all three Sections as a matter of law. But Ruiz did not equate ratification of a lease with pooling. It held, more narrowly, that a royalty owner’s ratification of a community lease—a lease, such as the 1954 lease, executed by separate owners of multiple tracts—was “effective to pool the royalties.” Id. at 844. The Supreme Court has since explained that pooling and community leasing share the same primary legal effect despite differences in the mechanics of their formation and in their secondary effects. Samson Expl., LLC v. T.S. Reed Props., Inc., 521 S.W.3d 766, 774, 777 & nn.27, 34 (Tex. 2017).4 Reported decisions both before and after the 1954 lease confirm that community leases have used the term “pooled” to both describe that shared effect, see Brown v. Smith, 174 S.W.2d 43, 44–45 (Tex. 1943) (community lease provided that royalties “are to be pooled and shared”), and to negate it, see London v. Merriman, 756 S.W.2d 736, 740 (Tex. App.—Corpus Christi 1988, writ denied) (“no pooling or unitization of royalty interest . . . is intended or shall be implied or result merely from the inclusion of such separate tracts within this lease”). These cases further demonstrate that pooling and community leasing are not synonymous. The phrase “or 3 Rule 40 clarifies that a lessee “may pool acreage, in accordance with appropriate contractual authority and applicable field rules, for the purpose of creating a drilling unit or proration unit by filing an original certified plat delineating the pooled unit and a Certificate of Pooling Authority” with the Railroad Commission. 16 Tex. Admin. Code pt. 1 ch. 3 § 3.40(a) (2025) (R.R. Comm’n of Tex., Assignment of Acreage to Pooled Development and Proration Units). Pooling provisions generally require filing a declaration of the unit in the property records. Union Gas Corp. v. Gisler, 129 S.W.3d 145, 150 (Tex. App.—Corpus Christi 2003, no pet.). 4 See 16 Tex. Admin. Code pt. 1 ch. 3 § 3.40(a) (2025) (describing formal requirements for pooling).
8 pooled with” thus provides some, but not conclusive evidence that the grantor intended the deed to convey royalty from the entire area covered by the community lease. Additional context is provided by a reading of the full sentence in which “or pooled with” appears: “Grantor . . . conveys . . . Grantor’s rights . . . in the oil, gas, and other minerals in and under, and that may be produced from or pooled with the following described lands . . . .” (emphasis added). RER argues that “in and under, and that may be produced from” reflects language describing a mineral interest, see Barker v. Levy, 507 S.W.2d 613, 615 (Tex. App.— Houston [14th Dist.] 1974, writ ref’d n.r.e.), and thus has no bearing on the royalty interest at issue. SoftVest responds without evidence that its NPRI is part of a mineral interest that was also conveyed by the deed. Even if the clause could be construed to describe the NPRI, the use of “or pooled with” within the phrase “that may be produced from or pooled with” suggests different interpretations that support either party. On the one hand, a grammatically correct version of the phrase— “minerals in and under, and that may be produced from the following described lands or lands pooled therewith”—has been held to describe a mineral interest with a right to royalty from pooled tracts.5 On the other hand, the clause here could be construed to convey only the minerals under the described tracts, and to clarify that the grantee is entitled to its proportionate share of any production by the lessee notwithstanding any pooling. In sum, the first portion of the granting clause offers some, but not clear, support for a conveyance of royalty outside Section 116. We turn to the second portion of the granting clause, which does address royalties. 5 See Spradley v. Finley, 302 S.W.2d 409, 410 (Tex. 1957) (holding “produced from said lands above described” in a mineral deed “clearly” referred only to minerals produced from the described lands but that “or land with which said land is pooled hereunder”—an additional phrase used in a subsequent lease signed by the grantor—effectively modified the deed to encompass production from pooled tracts).
9 (2) The royalty grant (the second part) The second portion of the granting clause, on which RER largely focuses its argument, describes an additional grant: [2] together with all of Grantor’s interest in all leasehold interests, royalties and overriding royalties payable out of production from the lands situated in Upton County, Texas, as described below[.] This portion specifically addresses the type of interest at issue in this case—royalties. Unlike the first portion, it specifies the location of the interest only by reference to the described lands, without the phrase “or pooled with.” RER reads this language to clearly limit the royalty conveyed to the lands “as described below.” SoftVest responds that it merely confirms, in abbreviated form, the pooled royalty already conveyed as an incident of the mineral estate. RER counters that this reading would render the second portion surplusage. Although we avoid surplusage where possible, courts also recognize that drafters often include redundant language for emphasis, Whole Woman’s Health v. Jackson, 642 S.W.3d 569, 582 (Tex. 2022), particularly in the royalty provisions of mineral deeds, see Schlittler v. Smith, 101 S.W.2d 543, 544 (Tex. [Comm’n Op.] 1937). The second portion likewise provides little guidance as to the grantor’s intent regarding royalty outside Section 116. We turn to the final portion of the granting clause. (3) Exhibit A (the final part) The third portion of the granting clause says: [3] SEE ATTACHED EXHIBIT “A” Exhibit A is referenced by the preceding two portions of the granting clause. The first portion conveys any interest in minerals in and under or pooled with “the following described
10 lands,” while the second portion grants whatever interest in royalties from “the lands situated in Upton County, Texas, as described below.” The entirety of Exhibit A provides as follows: EXHIBIT “A” Attached and made a part of that certain conveyance from AOG Mineral Partners, Ltd., as Grantor, and SoftVest LP et al, as Grantee 1. S/2 and NW/4 of Section 38, Block B, Certificate 12, A-754, TC Ry. Co. Survey; 2. Section 22, Block B, Certificate 882, A-957, HE&WT Ry. Co. Survey; 3. S/2 Section 116, Block D, CCSD&RGNG Ry. Co. Survey, Certificate 798; 4. Section 9, Block A, CCSD&RGNG Ry. Co.; 5. N/2 NE/4 and SW/4 NE/4 of Section 4, Block Y, GC&SF Ry. Co. Survey[.] As shown above, Exhibit A lists several unrelated tracts not otherwise included in the 1954 lease, without indicating which of the four interests named in the granting clause—mineral interests, royalties, overriding royalties, and leasehold interests—were held in each tract. Nor does Exhibit A indicate whether any tract had been pooled with other tracts, or which tracts lie in Upton County. These additional tracts thus raise at least two possibilities. If the grantor owned only royalty interests in Upton County, the grant of minerals would be surplusage; if it owned mineral interests or interests outside Upton County, the grant could be given effect as conveying those interests. Moreover, the tracts are listed in a separate exhibit, a short list that could have been included in the deed itself. That structure cautions against overreliance on the precise wording of the granting clause, suggesting the parties used general language to cover a heterogeneous list of interests. See Occidental Permian, Ltd. v. Citation 2002 Inv., LLC, 689 S.W.3d 899, 905 (Tex. 2024) (reconciling similar discrepancies between exhibit and granting clause).
11 Because we are instructed to harmonize all of the deed’s language, we turn to the deed’s remaining clauses for any further indication of the parties’ intent. B. Remaining clauses of the deed (1) The subject-to clause The subject-to clause provides that the deed is subject to existing and future leases and reiterates that the grantee is entitled to receive “all bonuses, rents, royalties, and other benefits which may accrue to the Conveyed Interests . . . precisely as if Grantee had been . . . the lessor.” SoftVest contends the clause further confirms and expounds on the interests conveyed by the granting clause, specifically royalties from tracts owned by other lessors of the 1954 lease. But as RER notes, the term “Conveyed Interests” is defined as the interests conveyed in the granting clause. Given this reference back to the granting clause, the subject-to clause does not clearly identify different interests than already described in the granting clause. The Texas Supreme Court has cautioned against overreading subject-to clauses in that manner. See Wenske, 521 S.W.3d at 797 (holding subject-to clause indicated an intent to avoid a breach of warranty rather than an attempt to reallocate royalties as indicated by the granting clause). Moreover, SoftVest’s predecessor was not “the lessor” but one of three lessors. In sum, the subject-to clause offers some, but not clear, support for a conveyance of royalty outside Section 116. (2) The habendum clause The deed continues with a standard habendum clause describing a perpetual grant to grantee of “the Conveyed Interests with all and singular the rights, privileges and appurtenances thereunder or anywise belonging[.]” Again, the clause refers back to the definition of Conveyed Interests and does not specifically refer to royalties from leased acreage that is not described in the deed. Whether such royalties are appurtenant to an NPRI in the described land simply restates the
12 question before us. Taken together, the text of SoftVest’s deed does not clearly indicate whether the royalty from leased acreage outside Section 116 was conveyed to SoftVest. Because the deed’s text does not resolve the question, we turn to the surrounding instruments offered by the parties to provide context and to aid our understanding of the deed’s language. Every prior deed in both chains of title uses materially identical language. We have noted that an appurtenances clause is a placeholder that “fails to identify what those rights and appurtenances are,” so we look to principles of real property law and Supreme Court precedent for guidance in defining similar rights. Anadarko Petroleum Corp. v. BNW Property Co., 393 S.W.3d 846, 849–52 (Tex. App.—El Paso 2012, pet. denied) (citing Day & Co. v. Texland Petroleum, Inc., 786 S.W.2d 667, 669 (Tex. 1990)). Because it does not identify what is appurtenant to the NPRI, the habendum clause provides no additional guidance as to the grantor’s intent. C. The surrounding instruments Both parties rely on evidence in support of their positions. The summary judgment evidence includes an undisputed chain of title, divided into two groups: a series of form deeds, dated from 1951 and 1959; and a series of typed deeds, dated in 2002, 2007, and 2010, which include incremental modifications as to the parties and tracts involved. Each deed in the chain of title is made expressly subject to existing or future leases, and the 1954 lease was ratified by the parties’ common predecessor in 1959, shortly before the NPRI was conveyed to J.H. Crouch. SoftVest bases its claim to royalties from the entire leased acreage on its 2010 deed, while RER relies on a subsequent 2022 quitclaim deed from the same grantor. RER asks that we disregard the 2010 deed to SoftVest because it omits the “communitized” royalty language found in both the preceding 2002 and 2007 Crouch family-trust deeds and the later 2022 quitclaim from the trustee to RER.
13 We may consider preceding instruments referenced in a chain of title and documents surrounding a deed’s execution, to the extent they “may ‘aid the understanding of an unambiguous contract’s language,’ ‘inform the meaning’ of the language actually used, and ‘provide context that elucidates the meaning of the words employed.’” Piranha Partners v. Neuhoff, 596 S.W.3d 740, 749 (Tex. 2020).6 Subsequent instruments are normally only relevant to the doctrine of presumed grant, which no party raises here. Clifton v. Johnson, 733 S.W.3d 16, 21 (Tex. 2026). Because the 2022 quitclaim from the trustee to RER postdates the deed at issue, we do not consider it as evidence of what the trustee conveyed in 2010. The first four deeds executed in the 1950s expressly limit the NPRI to the described tracts. The NPRI was initially carved out of the mineral estate by means of a 1951 deed granting an interest in royalties “in so far as the hereinbefore described land only is concerned” (emphasis added).7 Three Pound Printing & Stationery Company form deeds follow, each conveying a royalty interest in production from the described tract and providing royalty from any lease “only insofar as it or they cover the above described land” (emphasis added). The last of the form deeds was executed to J.H. Crouch shortly after the grantor ratified the lease in 1959. The next three instruments are deeds conveying numerous interests from Crouch to the family trusts, executed 40 years after he acquired the NPRI. The 2002 deed expressly conveys 6 See also Davis v. COG Operating, LLC, 658 S.W.3d 784, 791 (Tex. App.—El Paso 2022, pet. denied) (considering preceding mineral deed to determine scope of royalty deed); cf. Posse Energy, Ltd. v. Parsley Energy, LP, 632 S.W.3d 677, 693 (Tex. App.—El Paso 2021, pet. denied) (considering both prior and subsequent deeds to “confirm,” but not ascertain, scope of appurtenant rights); see also Texas Dep’t of Transp. v. A.P.I. Pipe & Supply, LLC, 397 S.W.3d 162, 169 (Tex. 2013) (explaining that “[a]ny description, recital of fact, or reference to other documents” puts a grantee on notice of “the whole series of title deeds”) (emphasis in original). 7 The granting clause provides: “[G]rantors . . . grant . . . an undivided 1/32 interest in and to all (8/8) of the oil, gas, casinghead gas and other hydro-carbons in and under and that may be produced from the following described land situated in the County of Upton . . . [in] Section No. 116 . . . said undivided 1/32 interest being equivalent to 1/4 of the usual and customary 1/8 royalties in oil, gas, casinghead gas and other hydro-carbons, and to come out of the royalties that accrue . . . under any . . . lease on the hereinbefore described land, in so far as the hereinbefore described land only is concerned. It is understood and agreed that said undivided 1/32 interest conveyed is a royalty interest only . . . .”
14 interests in royalties and “communitization agreements,”8 and states at the bottom of Exhibit A that the grantor intends to convey all such interests “OWNED BY GRANTOR WHEREVER LOCATED IN THE UNITED STATES, WHETHER CORRECTLY OR INCORRECTLY DESCRIBED ABOVE OR OMITTED IN ITS ENTIRETY.” A subject-to clause in that deed, however, clarifies that the conveyance is intended to include all royalties under any lease “precisely as if the Grantee herein had been at the date of making said lease and/or leases the owner of a similar undivided interest in and to the Property and none other and Grantee one of the lessors therein” (emphasis added). The same language appears in a 2007 conveyance to a family trust. The 2010 deed from AOG to SoftVest, by contrast, eliminates all of that language, replacing the broad Exhibit “A” statement with9 the text, “intentionally left blank.”10 Although the 2002 and 2007 deeds provide some support for RER’s argument that the deed at issue deliberately omitted communitized royalty, the preceding deeds contradict that argument by expressly limiting the NPRI to Section 116. To the extent RER’s 2022 quitclaim deed is relevant, it shows that the royalty from other tracts could have been specified in all the preceding deeds, but it was not. We are hesitant to place dispositive weight on the absence of language in one deed that does not appear in any of the standard form deeds in both parties’ chains of title. 8 The granting clause provides: “Grantor . . . does hereby GRANT . . . all of Grantor’s undivided interest, in and to all the oil, gas and minerals, including, but not limited to, mineral interests, royalty interests, overriding royalty interests, interests in oil and gas leases, oil, gas and mineral leases, [sic] working interests, unit agreements, pooling agreements, communitization agreements, and production payments in, on, under and produced from all lands in which Grantor owns an interest located in the United States of America, including, but not limited to, those certain lands and leases described on Exhibit “A.” 9 RER also points to its own quitclaim deed—executed four days before this suit was filed—purporting to convey “any royalty interest on oil, gas, and other minerals produced from or attributable to” the portions of the lease area outside Section 116. RER also points to a SoftVest deed with a subsequent deed conveying a 10% interest in “all rights in any pooled or unitized acreage by virtue of the [NPRI] being a part thereof.” 10 This deed conveys a 10% interest in the NPRI to SoftVest’s former co-defendant Franco-Nevada. SoftVest itself only acquired an 87.5% interest.
15 Indeed, the long and unbroken chain of standard form deeds on which both parties rely lends some support to SoftVest’s position that the NPRI was never confined to Section 116. D. The common law rule (1) The cross-conveyance doctrine We turn to the cross-conveyance doctrine, a common-law rule that both parties invoke to clarify the grantor’s intent. Under the cross-conveyance doctrine, owners of separate tracts who sign a community lease are treated as “joint owners, or joint tenants, of all royalties reserved in each of the several leases in such block, the ownership being in the proportion which the acreage of each lease contract bears to the total acreage of the unitized block.” Veal v. Thomason, 159 S.W.2d 472, 476 (Tex. 1942). The parties agree that Currie’s 1959 ratification of the lease effected a cross-conveyance, vesting Currie with an interest in production from the entire lease area in proportion to her contributed acreage for the duration of the lease. SoftVest contends that this interest passed intact through each deed in the chain of title, each describing a royalty interest in Section 116, down to the 2010 deed from AOG to SoftVest. RER contends the 2010 deed conveyed only an interest in Section 116 burdened by the other owners’ shares but without the corresponding benefit of a pro rata share of production from other tracts. RER bases this asymmetric result on a literal interpretation of cross-conveyance, under which Currie was vested with distinct interests in Sections 12 and 40. Because those interests are separate from the interest in Section 116, RER reasons that the 2010 conveyance of the interest in the described Section 116 tract did not include the interests in the other tracts. RER’s argument is contrary to the premise of cross-conveyance: each party obtains an undivided interest in the unitized block. Veal, 159 S.W.2d at 476. That undivided interest carries
16 symmetric benefits and burdens: each lessor “relinquishes his right to have his own tract separately developed, his right to receive all of the royalties from production from wells on his own tract, and his right to have wells drilled on his tract off-setting other wells on the leased premises, and each gains the right to share proportionately in royalties from wells on the other included tracts” (emphasis added). Southland Royalty Co. v. Humble Oil & Refining Co., 249 S.W.2d 914, 916 (Tex. 1952). Each contributed interest is at once benefited and burdened—benefited by the proportionate share of royalty on every tract, and burdened by the other owners’ shares of the royalty on its own. Here, Currie’s ratification of the community lease placed her royalty interest in Section 116 into the unitized block. She relinquished the right to receive all of the royalty from production on Section 116 and gained, in exchange, the right to share proportionately in royalty from production on Sections 12 and 40. The benefit and burden were created together, exist on the same terms, and exist for the same duration. The cross-conveyance doctrine thus supports the conclusion that the contributor’s share in royalty from the other tracts is included in the contributor’s interest in the burdened tract and passes with a conveyance of that tract unless the conveyance says otherwise. In weighing that doctrine, we are mindful of the Texas Supreme Court’s instruction in Wenske that our paramount duty is to ascertain the parties’ intent from the four corners of the instrument; and to avoid quick resort to default or arbitrary rules of construction. 521 S.W.3d at 794. The cross-conveyance theory is more arcane, and less well established, than the definition of minerals and the “basic principle of mineral conveyance” on which the Court there relied. The Texas Supreme Court most recently gave the doctrine only tentative support in Samson, describing it as a theory “of presumed contractual intent.” Samson Expl., 521 S.W.3d at 776–77 (citing BRUCE M. KRAMER & PATRICK H. MARTIN, THE LAW OF POOLING AND UNITIZATION § 19.02[2][d]
17 (3d ed. 2016)). The Court observed that the doctrine “do[es] not exist in the abstract” but has been invoked to resolve discrete questions—venue, indispensable parties, authority to pool, and the statute of frauds. Id. at 777–78 & nn.34–35. As to the question before it, the Court found the theory a “theoretical construct that holds no water.” Id. Samson involved a claim brought against a lessee for payment of pooled royalty under the express terms of the lease, rather than a claim to apportion royalty among the owners under a deed that did not specifically address the matter. The doctrine is less well established in this context for a further reason. Two of our sister courts have reached the opposite conclusion on this question, holding that royalty from tracts under a common lease not described in a deed does not pass with the conveyance of a royalty interest. McCall v. McCall, 24 S.W.3d 508, 514–16 (Tex. App.—Houston [1st Dist.] 2000, pet. denied); Aery v. Hoskins, Inc., 493 S.W.3d 684, 698–704 (Tex. App.—San Antonio 2016, pet. denied). In Aery, the instrument included a provision expressly incorporating the cross-conveyance doctrine. Both courts relied on a West Virginia case, Avery v. Moore, 144 S.E.2d 434 (W. Va. 1965), and Texas cases involving other types of appurtenances.11 Neither Aery nor McCall explained how their holdings accorded with Texas’s principles of cross-conveyance and appurtenant mineral rights. By contrast, the Mississippi Supreme Court, applying Texas cross-conveyance law, treated royalty under a community lease as appurtenant to the conveyed tract. Merrill Eng’g Co. v. Capital Nat’l Bank of Jackson, 5 So.2d 666, 671–73 (Miss. 1942). Following Wenske, we consider whether a more basic principle resolves the question. Wenske rested on the established definition of minerals and on a basic principle of mineral 11 Avery held that a deed to one partitioned tract did not convey the grantor’s undivided cotenancy interest in the oil and gas under the other partitioned tracts. 144 S.E.2d at 434. We note that both McCall and Aery involved tracts that were partitioned, although this fact of partition was not considered in connection with the question of whether the grantor intended the royalty to pass with the later conveyance. Both involved royalty shared across separately owned tracts under a common lease—a lease jointly executed by cotenants in McCall, 24 S.W.3d at 510–12, and by express cross-conveyance in a partition and royalty agreement in Aery, 493 S.W.3d at 694–95.
18 conveyance: a mineral interest ordinarily carries a proportionate share of royalty and a proportionate share of any outstanding royalty burden. Wenske, 521 S.W.3d at 797. We note that the interest here is not a mineral interest but an NPRI, and the disputed right is only a right to royalty on production from other tracts for the life of the lease. Texas has long recognized that an NPRI is an interest in real property. We further note that the royalty at issue is limited to royalty under the 1954 lease and is limited in duration to the terms of that lease. The Supreme Court, however, has held that a nonexecutive term interest in part of a larger leased tract carried a proportionate share of lease proceeds from production anywhere on the leased acreage, and that this right was an interest that expired with the term interest. Minchen v. Fields, 345 S.W.2d 282, 285, 287–88 (Tex. 1961). The Court did not explain why the interest in one tract carried the right to proceeds from production on the others; it treated the point as a given. Id. at 287–88. We note as well that commentators on Texas oil and gas law have long assumed the same as to the question presented here: that a conveyance of royalty in land subject to a community lease carries the grantor’s share of royalty from the other tracts.12 That understanding is consistent with both the cross-conveyance doctrine and the basic principle of mineral conveyance recognized in Wenske. It follows that, absent language to the contrary in the deed to SoftVest, the conveyance of the NPRI included royalty from all tracts under the lease. (2) The absence of contrary language We consider, finally, whether the deed plainly expresses an intent contrary to the principle just described, that royalty in one tract under a community lease carries royalty from the others. Nothing in the granting clause, Exhibit A, the subject-to clause, or the habendum clause plainly 12 See William O. Huie, Apportionment of Oil and Gas Royalties, 78 Harv. L. Rev. 1113, 1137 (1965); Joseph J. French, Jr. & Frank W. Elliott, Jr., The Legal Effect of Voluntary Pooling and Unitization: Theories and Party Practice, 35 Tex. L. Rev. 401, 415–16 (1957); Charles C. Loveless, Jr., Oil and Gas—Community Lease—Nature of Community Lessors’ Royalty Interest, 25 Tex. L. Rev. 315, 316–17 (1947).
19 expresses a contrary intention. See Wenske, 521 S.W.3d at 797. Each of the isolated phrases that RER relies on can be construed as consistent with that principle when read in context—particularly in the context of the prior deeds in the chain of title on which RER bases its claim. By RER’s own argument, the omission of descriptions of other tracts in the printed form deeds left all the parties’ common predecessors since 1951 out of the chain of title as to royalty from other tracts under lease, which would require rendition of judgment that neither party owns such royalty.13 No party seeks that result. Furthermore, the 2002 and 2007 deeds that RER cites as demonstrating a deliberate omission make only a passing reference to “communitization agreements” in a laundry list that includes “mineral interests, royalty interests, overriding royalty interests, interests in oil and gas leases, oil, gas, and mineral leases, working interests, unit agreements, pooling agreements, communitization agreements and production payments.” By RER’s argument, even that exhaustive language would not suffice because it fails to specifically describe the leased tracts. In construing similar instruments that fail to clearly allocate royalty, the Texas Supreme Court has approached the issue from a “utilitarian standpoint,” mindful of “the particular business activity sought to be served,” and has avoided an unduly literal construction of isolated phrases.14 RER’s theory would require grantors to separately describe every tract in which the grantor holds 13 RER appeals the trial court’s denial of its motion for summary judgment as to ownership, asking the trial court to declare “the parties’ respective rights.” RER asked the trial court not only for an affirmative declaration of ownership based on its chain of title but a declaration that the NPRI was not conveyed to SoftVest. On appeal it asks ambivalently that we “render judgment in favor of Appellants on their claim for declaratory judgment, and remand for further proceedings.” The trial court refused all declarations requested by RER, but issued a final judgment granting SoftVest’s motion, supported by the same evidence of title, decreeing that RER’s claim for declaratory judgment “to declare the conveyance . . . to [] SoftVest . . . did not include any non-participating royalty interest in Section 12” was dismissed. 14Endeavor Energy Res., LP v. Energen Res. Corp., 615 S.W.3d 144, 148 (Tex. 2020); Burlington Res. Oil & Gas Co. LP v. Texas Crude Energy, LLC, 573 S.W.3d 198, 203 (Tex. 2019); see also Devon Energy Prod. Co., L.P. v. Sheppard, 668 S.W.3d 332, 343 (Tex. 2023); Nettye Engler Energy, LP v. BlueStone Nat. Res. II, LLC, 639 S.W.3d 682, 691–92 (Tex. 2022); BlueStone Nat. Res. II, LLC v. Randle, 620 S.W.3d 380, 387 (Tex. 2021); U.S. Shale Energy II, LLC v. Laborde Props., L.P., 551 S.W.3d 148, 151 (Tex. 2018).
20 related royalty rights, including pooled units comprising numerous tracts. Judging by the various printed and typed deeds on which RER bases its claim, such a requirement would appear contrary to settled expectations.15 Our holding does not prevent a grantor of a royalty interest from retaining royalty from other tracts under lease; as with any attribute of a conveyed mineral interest, the grantor need only plainly express that intention. See Wenske, 521 S.W.3d at 797. The deed before us expresses no such intention. We hold that the 2010 deed conveyed to SoftVest the grantor’s share of royalty from all tracts subject to the 1954 lease, and we overrule both of RER’s issues. V. CONCLUSION Having overruled both of RER’s issues, we affirm the trial court’s judgment. GINA M. PALAFOX, Justice October 20, 2026 Before Salas Mendoza, C.J., Palafox, and Soto, JJ. Soto, J., concurring 15 See Christopher S. Kulander, Conveying Pooled Mineral Interests and the Curious Case of Aery v. Hoskins, Inc., 14 Tex. J. Oil Gas & Energy L. 63, 84–90 (2019) (criticizing Aery for holding that drafters must describe all tracts, “not just the lease itself and (perhaps) the land originally leased, which most certainly is not industry custom and practice”; “the lesson [of Aery] is clear: if you intend to assign all of a pooled royalty interest derived from a mineral fee, do not rely on industry custom and practice in relation to the assignment of oil and gas leases, but instead describe all lands over which the royalty covers, and not just the original mineral fee prior to pooling”); see also 3 WILLIAMS & MEYERS, OIL AND GAS LAW § 660 (2025) (noting the preferable view is that it is not necessary to specify pooled or unitized tracts in deeds, but to address “uncertainty in some states,” advising drafters to “include in any conveyance affecting premises included in a pooling, unitization or joint operating agreement [an] express provision concerning the grantor’s interest in production from other premises included in such agreement”).
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