Introduction

The case of GARY DON PERRYMAN, NANCY K. PERRYMAN AND LEASHA PERRYMAN BOWDEN; AND EOG RESOURCES INC. v. SPARTAN TEXAS SIX CAPITAL PARTNERS, LTD., SPARTAN TEXAS SIX-CELINA, LTD., AND DION MENSER (546 S.W.3d 110) presented a complex legal dispute surrounding the interpretation of contractual clauses within a series of real-property deeds. The primary issue revolved around the function and implications of "save and except" clauses in these deeds, specifically concerning the allocation of royalty interests from mineral production on the property. The parties involved included the Petitioner Perrymans and EOG Resources Inc., against Respondents Spartan Texas Six Capital Partners, LTD., Spartan Texas Six-Celina, LTD., and Dion Menser.

Summary of the Judgment

The Supreme Court of Texas, in an opinion delivered by Justice Boyd, affirmed significant portions of the appellate court's judgment while modifying others. The Court addressed two main issues: the allocation of royalty interests based on "save and except" clauses in the property deeds, and the proper venue for the legal proceedings.

The Court concluded that the "save and except" clauses in the deeds did not reserve royalty interests for the grantors as previously interpreted by the lower courts. Instead, these clauses excepted a portion of the royalty interests from the conveyance, ensuring that the grantees received the remaining interests. Consequently, the royalty interests were allocated as follows:

Tract	Party	Royalty Interest
178-Acre Tract	Spartan	1/4
178-Acre Tract	Leasha Perryman Bowden	1/4
178-Acre Tract	Gary & Nancy Perryman	1/4
178-Acre Tract	Menser	1/4
28-Acre Tract	Third Parties (Wrights)	1/4
28-Acre Tract	Menser	1/4
28-Acre Tract	Leasha Perryman Bowden	1/4
28-Acre Tract	Gary & Nancy Perryman	1/4

Additionally, the Court upheld the trial court's decision to deny the Perrymans' motion to transfer venue, deeming Harris County the appropriate venue for the case.

Analysis

Precedents Cited

The Court referenced several key precedents to navigate the complexities of deed interpretation and venue determination:

• Duhig v. Peavy-Moore Lumber Co.: Established that a grantor cannot both reserve and convey interests they do not wholly possess, creating an estoppel to prevent over-conveyance.
• PICH v. LANKFORD: Clarified that reservations must be clear and specifically in favor of the grantor to be effective.
• Stewman Ranch, Inc. v. Double M Ranch, Ltd. and Hunsaker v. Brown Distributing Co.: Addressed specific interpretations of "save and except" clauses in contexts where prior reservations existed.
• LUCKEL v. WHITE and Wenske v. Ealy: Emphasized that unambiguous deeds are to be construed strictly as a matter of law.
• BASS v. HARPER, City of Garland v. Dall. Morning News, and Texas Property Code references: Further supported the principles surrounding duty of notice and interpretation of contractual clauses.

Legal Reasoning

The crux of the Court's reasoning hinged on the grammatical and logical interpretation of the "less, save and except" clauses in the deeds. The Court determined that the phrase "which are now owned by Grantor" grammatically modified "premises" rather than "royalties." This interpretation was pivotal in distinguishing between an exception (mere exclusion from the grant) and a reservation (setting aside for the grantor's benefit), with reservations requiring unequivocal intent and clear language.

By treating the clause as an exception, the Court concluded that the deeds did not reserve any royalty interests for the grantors but merely excluded a portion from the conveyance. This distinction negated the applicability of the Duhig estoppel doctrine, as there was no over-conveyance or breach of warranty requiring equitable remedies.

Furthermore, in addressing venue, the Court analyzed statutory interpretations alongside procedural rules, ultimately affirming that the original choice of Harris County was proper based on the mandatory venue provisions and the nature of third-party claims.

Impact

This judgment establishes a clear precedent on the interpretation of "save and except" clauses in real-property deeds, particularly in the context of mineral and royalty interests. By distinguishing exceptions from reservations, the Court provides a framework that prevents unintended over-conveyances and clarifies the allocation of interests among multiple parties. Future cases will likely reference this decision when disputes arise over deed interpretations and the distribution of mineral rights.

Additionally, the affirmation on venue underscores the importance of understanding statutory interpretations in multi-party litigation, guiding litigants in appropriately selecting venues to avoid procedural setbacks.

Complex Concepts Simplified

Save and Except Clause

A "save and except" clause in a property deed serves to exclude certain interests from the transfer of property. In this case, the clause was meant to exclude a portion of royalty interests from being transferred to the buyer, ensuring that the seller retains ownership of those royalties.

Duhig Estoppel Doctrine

The Duhig estoppel doctrine prevents a party from claiming an interest they otherwise would not possess due to previous actions or representations. Essentially, if someone conveys property and excludes certain interests without proper reservation, they cannot later claim those excluded interests were reserved for them.

Royalty Interest

Royalty interests refer to the rights to receive payments from the production of minerals (like oil and gas) extracted from a property. These interests are separate from the ownership of the land itself and can be divided among multiple parties.

Judicial Estoppel

Judicial estoppel is a legal principle that prevents a party from taking contradictory positions in different legal proceedings. In this case, it was argued whether the Perrymans were estopped from claiming certain royalty interests due to inconsistencies in previous filings.

Conclusion

The Supreme Court of Texas, in this landmark decision, meticulously dissected the language and intent behind "save and except" clauses in property deeds. By clarifying that such clauses, when coupled with phrases like "which are now owned by Grantor," serve to exclude interests rather than reserve them, the Court eliminated ambiguity in the distribution of royalty interests among multiple parties. This decision not only resolves the specific dispute among the Perrymans, Spartan Partners, and EOG Resources but also sets a definitive standard for future cases involving similar contractual clauses and property interest allocations.

Moreover, the Court's affirmation regarding venue emphasizes the necessity for parties to adhere strictly to statutory and procedural rules, ensuring that legal actions are filed in appropriate jurisdictions. Overall, this judgment enhances clarity and predictability in real-property law, particularly in the nuanced area of mineral and royalty interests.