Justia Real Estate & Property Law Opinion Summaries

Articles Posted in Supreme Court of Texas
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In this contract dispute involving the correct interpretation of a mineral lease's "continuous drilling program" provision the Supreme Court held that the court of appeals erred in reversing partial summary judgment for the lessee on the contract-construction issue.Lessor and Lessee were the successors-in-interest to an oil-and-gas top lease covering a 30,450-acre parcel of land. At the end of the primary term, Lessee was required to reassign to Lessor all of Lessee's operating rights in each tract of the lease not then held by production unless Lessee was engaged in a "continuous drilling program." Notwithstanding Lessee's continued drilling operations, Lessor filed a suit seeking a declaration that the lease had terminated. The trial court granted partial summary judgment for Lessor, concluding that the lease had not terminated as to non-producing tracts. The court of appeals reversed. The Supreme Court reversed, holding (1) under the lease's special definition of drilling operations, activities other than spudding-in a well are sufficient to maintain the lease as to non-producing tracts; and (2) the record conclusively established that Lessee was engaged in a continuous drilling program within the meaning of the lease. View "Sundown Energy LP v. HJSA No. 3" on Justia Law

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In this second action arising out of a joint effort by TRO-X, L.P. and Eagle Oil & Gas Co. to acquire and sell oil-and-gas the Supreme Court affirmed the judgment of the court of appeals reversing the trial court's grant of summary judgment for Eagle, holding that Eagle did not conclusively establish the affirmative defenses that were the basis of its summary judgment motion.In its first suit, TRO-X alleged that Eagle deprived TRO-X of its right to acquire its share of mineral leases that Eagle retained as part of the leases' sale. The court of appeals determined that TRO-X had not been deprived of equitable title to those interests because TRO-X had always held them. In this second suit, TRO-X claimed that Eagle failed to remit its share of income generated from production on the interests that commenced after the first trial's conclusion. The trial court granted summary judgment for Eagle, and the court of appeals reversed. The Supreme Court affirmed, holding that Eagle did not conclusively establish the affirmative defenses of res judicata, statute of limitations, or waiver. View "Eagle Oil & Gas Co. v. TRO-X, L.P." on Justia Law

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In this property dispute between neighboring landowners, the Supreme Court reversed the decision of the court of appeals reversing the judgment of the trial court finding that Plaintiffs held peaceful and adverse possession of the disputed property for the requisite time, holding that Plaintiffs' pleading alleged a claim of trespass to try title by adverse possession.In reversing, the court of appeals ruled that the pleadings did not support the judgment because Plaintiffs described their claim as a quiet title action rather than a trespass to try title action. The Supreme Court reversed, holding (1) Plaintiffs' pleadings supported the submission of adverse possession to the jury; and (2) in substance and effect, Plaintiffs sued for title to the disputed property, and in denominated their claim as an "action to quiet title," Plaintiffs did not nullify the substance of their adverse-possession actions. View "Brumley v. McDuff" on Justia Law

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The Supreme Court reversed the judgment of the court of appeals concluding that a refinancing lender's failure to timely foreclose its property lien precluded the lender from seeking recourse from the borrowers' default through equitable subrogation, holding that a lender's forfeit of its lien does not preclude the lender's equitable right to assert a preexisting lien discharged with the proceeds from its loan.After Borrowers defaulted, Lender sought foreclosure of its lien and alternatively sought a judgment declaring its right to foreclosure of the underlying liens on the property through equitable subrogation. The trial court declared that Lender's lien was unenforceable. The court of appeals affirmed, thus rejecting Lender's assertion of an equitable right to enforce the liens. After the court of appeals issued its opinion, the Supreme Court decided Fed. Home Loan Mortgage Corp. v. Zepeda, 601 S.W.3d 763 (Tex. 2020). The Supreme Court reversed the portion of the judgment declaring Lender's equitable subrogation rights unenforceable, holding that the Court's opinion in Zepeda required reversal. View "PNC Mortgage v. Howard" on Justia Law

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In this dispute over the meaning of an oil and gas lease covering an 11,300-acre tract in Howard County, the Supreme Court reversed the judgment of the court of appeals affirming the trial court's grant of summary judgment for Energen Resources Corp. and John Quinn, holding that the contested provision of the lease in this case was ambiguous.The lease at issue allowed Endeavor Energy Resources, L.P. to retain its leasehold interest in the parcel only by drilling a new well every 150 days, with the exception that Endeavor could "accumulate unused days in any 150-day term...in order to extend the next allowed 150-day term between the completion of one well and the drilling of a subsequent well." At issue on appeal was how to calculate the number of "unused days." Energen and Quinn argued that the contested provision unambiguously allowed unused days earned in any term to be carried forward only once to the next 150-day term. The trial court agreed, and the court of appeals affirmed. The Supreme Court reversed, holding that the disputed provision was ambiguous. View "Endeavor Energy Resources, LP v. Energen Resources Corp." on Justia Law

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The Supreme Court reversed in part and affirmed in part the judgment of the court of appeals in this dispute over the continuing validity of an interest in a mineral lease, holding that a reserved overriding royalty interest (ORRI) in a lease that includes an anti-washout provision extending the interest to new leases is a real property interest that violates the rule against perpetuities (the Rule).The court of appeals held that the ORRI violated the Rule and was no subject to reformation under the Property Code. The court further held (1) the indemnity agreement in this case was not invoked, and (2) sufficient evidence supported the appellate attorneys' fees awarded. The Supreme Court affirmed the court of appeals' judgment on the issues of indemnity and attorneys' fees and otherwise reversed and remanded for the court of appeals to consider whether the ORRI in new leases may be reformed to comply with the Rule, holding that the ORRI in question must be reformed, if possible, in accordance with Tex. Prop. Code 5.043. View "Yowell v. Granite Operating Co." on Justia Law

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The Supreme Court reversed the judgment of the court of appeals reversing the order of the trial court that Petitioners pay $7,000 from a supersedeas bond over losing the underlying appeal and ordering Petitioners to pay $114,280 from the bond, holding that the court of appeals erred in calculating the amount.When Petitioners were ousted from land upon which their cattle grazed, they brought this action challenging the ouster. The trial court granted summary judgment in part for Respondents then, after a trial, rendered judgment that Petitioners take nothing. The trial court allowed Petitioners to suspend the judgment by posting a supersedeas bond, which meant Petitioners could keep their cattle on the leased land during the appeal. The trial court ruled that Respondent was entitled to $7,000 from the bond. The court of appeals reversed, concluding that Respondent should recover $114,280 from the bond, basing its calculation on the expense Petitioners would have incurred if the judgment had not been superseded. At issue was how "loss or damage" is calculated on release of a supersedeas bond under Tex. R. App. 24.2(a)(3). The Supreme Court reinstated the trial court's order, holding that the proper measure is the actual loss Respondent suffered because the judgment was superseded. View "Haedge v. Central Texas Cattlemen's Ass'n" on Justia Law

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In this real estate dispute, the Supreme Court held that where the plain language of a special warranty deed limited the grantor's liability for failures of title to claims asserted by individuals "by, through and under" the grantor, the grantor could not be liable for breach of the covenant of seisin because the plaintiff asserted no such claim.The grantor of property, who purchased the property at a foreclosure sale, and the grantee entered into a residential sales contract, and the grantor conveyed the property by special warranty deed to the grantee. The grantee obtained title insurance from an insurer. When the validity of the foreclosure sale was challenged, the insurer assumed the grantee's defense and settled the suit. As the grantee's subrogee, the insurer sued the grantor for breach of the sales contract and breach of the implied covenant of seisin. The trial court found in favor of the insurer. The court of appeals reversed. The Supreme Court held (1) the special warranty deed barred the insurer's recovery because, regardless of whether it implied the covenant of seisin, the deed limited the grantor's liability for failures of title to claims asserted by individuals "by, through and under" the grantor; (2) because the failure of title did not arise from such a claim, the grantor was not liable for it; and (3) the merger doctrine barred the insurer's breach of contract claim. View "Chicago Title Insurance Co. v. Cochran Investments, Inc." on Justia Law

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The Supreme Court reversed the judgment of the court of appeals concluding that an insurer's payment of an appraisal award barred an insured's claims under the Texas Prompt Payment of Claims Act (TPPCA), Tex. Ins. Code chapter 542, holding that payment of an appraisal award does not extinguish TPPCA liability as a matter of law.After Insured's property sustained damage from a storm, Insurer valued the property damage at $5,153. Believing the property damage was undervalued, Insured sued, alleging breach of contract and extra-contractual claims and invoking the policy's appraisal clause. Appraisers valued the damage at almost $15,000. Insurer paid the balance of the award and then filed a motion for summary judgment. The trial court granted the motion. The court of appeals affirmed, concluding that, as a matter of law, Insured could not maintain his TPPCA claim because Insurer paid the appraisal award. The Supreme Court reversed and remanded the case, holding that the court of appeals' opinion was inconsistent with this Court's recent decisions on the issue. View "Perry v. United Services Automobile Ass'n" on Justia Law

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The Supreme Court reversed the judgment of the court of appeals concluding that an insurer's payment of an appraisal award barred an insured's claims under the Texas Prompt Payment of Claims Act (TPPCA), Tex. Ins. Code chapter 542, holding that payment of an appraisal award does not extinguish TPPCA liability as a matter of law.After Insured's property sustained hail and wind damage, Insurer valued the property damage at $387. Believing the damage was undervalued, Insured sued, alleging breach of contract and extra-contractual claims. Insurer successfully moved the trial court to compel appraisal, and the appraisal award exceeded Insurer's prior estimates. Insurer paid the award and then filed a motion for summary judgment. The trial court granted the motion and rendered a take-nothing judgment. The court of appeals affirmed, concluding that, as a matter of law, Insured could not maintain his TPPCA claim because Insurer paid the appraisal award. The Supreme Court reversed, holding that the court of appeals' opinion was inconsistent with this Court's recent decisions on the issue. View "Marchbanks v. Liberty Insurance Corp." on Justia Law