No. 04-14-00807-CV

__________________________________________________________________

IN THE COURT OF APPEALS 

FOURTH COURT OF APPEALS DISTRICT OF TEXAS 

SAN ANTONIO, TEXAS 

__________________________________________________________________ 

BRAD AERY, ET AL., 

 Appellants 

v.

HOSKINS, INC., ET AL., 

 Appellees. 

__________________________________________________________________

On Appeal from 36th District Court of McMullen County, Texas 

Trial Court Cause No. M-12-0045-CV-A 

Honorable Starr Boldrick Bauer, Presiding 

__________________________________________________________________

BRIEF OF APPELLEE AURORA RESOURCES CORPORATION 

__________________________________________________________________

Roberta S. Dohse 

State Bar No. 05955400 

rdohse@hfdlaw.com

Conner R. Jackson 

State Bar No. 24087786 

cjackson@hfdlaw.com 

HOBLIT DARLING RALLS HERNANDEZ

 & HUDLOW, LLP

2000 Frost Bank Plaza 

802 N. Carancahua 

Corpus Christi, TX 78401 

(361) 888-9392 

(361) 888-9187 (facsimile) 

Counsel for Appellee 

Aurora Resources Corporation 

ACCEPTED

04-14-00807-CV

FOURTH COURT OF APPEALS

SAN ANTONIO, TEXAS

5/20/2015 4:00:54 PM

KEITH HOTTLE

CLERK

 FILED IN 4th COURT OF APPEALS SAN ANTONIO, TEXAS 05/20/2015 4:00:54 PM KEITH E. HOTTLE Clerk FILED IN 4th COURT OF APPEALS SAN ANTONIO, TEXAS 05/20/2015 4:00:54 PM KEITH E. HOTTLE Clerk
ii

Identities of Parties and Counsel

Pursuant to TEX. R. APP. P. 38.1(a), Appellee Aurora Resources Corporation 

submits the following list of the names and last known addresses of all parties and 

their counsel at trial and on appeal:

Appellants/Plaintiffs Brad Aery

Randi Aery

Counsel for the 

Aery Appellants Dan Pozza

State Bar No. 16224800

Dan.pozza@yahoo.com

Law Offices of Dan Pozza

239 E. Commerce Street

San Antonio, TX 78205-2923

(210) 226-8888

(210) 224-6373 (facsimile)

Trial Counsel for the

Aery Appellants Marc K. Whyte

State Bar No. 24056526

whytemarc@gmail.com

Whyte, PLLC

209 Tuttle

San Antonio, TX 78209

(210) 340-9877

(210) 344-9899 (facsimile)

Melanie Hessler Phipps

State Bar No. 24032416

mphipps@kplegal.com

Kustoff & Phipps, LLP

4103 Parkdale Street

San Antonio, TX 78229-2520

(210) 614-9444

(210) 614-9464 (facsimile)
iii

John George, Jr.

State Bar No. 24051944

jgeorgejr@bmpllp.com

Matthew F. Wymer

State Bar No. 24005234

mwymer@bmpllp.com

Bierne Maynard & Parson, LLP

112 East Pecan Street, Suite 2750

San Antonio, TX 78205

(210) 582-0220

(210) 582-0231 (facsimile)

Appellants/Intervenors: The J.L. House Trust

Lloyd House

Robert Eugene House

Magdalen House

Judith Ann House

Wayne House

Jimmy R. House

Edna Pawelek Ulbrich

Peter James Pawelek

Jesse Pawelek

Ruby Pawelek Schumacher

Elizabeth Pawelek Reich

Roy Mitchell Pawelek

Darlene Robinson Williams

Diane Fischer Casey

Mary Kay Fischer Adams

Arley House

Counsel for 

the House Appellants: Rosemarie Kanusky

State Bar No. 00790999

Rosemary.kanusky@nortonrosefulgright.com

John W. Weber, Jr.

State Bar No. 21046500

John.weber@nortonrosefulbright.com

Jeffrey A. Webb

State Bar No. 24053544

Jeff.webb@nortonrosefulbright.com
iv

300 Convent, Suite 2100

San Antonio, TX 78205

(210) 224-5575

(210) 270-7205 (facsimile)

Trial Counsel for

the House Appellants: John W. Weber, Jr.

State Bar No. 21046500

John.weber@nortonrosefulbright.com

Jeffrey A. Webb

State Bar No. 24053544

Jeff.webb@nortonrosefulbright.com

300 Convent, Suite 2100

San Antonio, TX 78205

(210) 224-5575

(210) 270-7205 (facsimile)

Appellees/Defendants: C. Clifton Hoskins

Hoskins, Inc.

Trudy Day

Counsel for

these Hoskins Appellees: C. David Kinder

State Bar No. 11432550

dkinder@dykema.com

Corey F. Wehmeyer

State Bar No. 24051903

cwehmeyer@dykema.com

Amy Davis

State Bar No. 24074114

adavis@dykema.com

Benjamin Robertson

State Bar No. 24083748

brobertson@dykema.com

Lindsay Scaief Riley

State Bar No. 24083799

lriley@dykema.com

Ellen B. Mitchell

State Bar No. 14208875

emitchell@dykema.com
v

Dykema Cox Smith

112 East Pecan, Suite 1800

San Antonio, TX 78205

(210) 554-5500

(210) 226-8395 (facsimile)

and Michael C. Sartori

State Bar No. 17655500

michael@msartori.com

Law Office of Michael C. Sartori

P.O. Box 1222

502A Houston Street

George West, TX 78022

(361) 449-2691

(361) 449-2380 (facsimile)

Appellees/Defendants: Leonard Hoskins

Counsel for

Leonard Hoskins David L. Ylitalo

State Bar No. 22155500

dylitalo@coatsrose.com

Coats Rose PC

1020 Northeast Loop 410, Suite 800

San Antonio, TX 78209

(210) 224-7098

(210) 212-5698 (facsimile)

Appellees/Defendants: Lee Ann Kulka

Lee Roy Hoskins, III

Andrea Jurica

Counsel for 

Kulka, Hoskins and Jurica

Appellees: Peter E. Hosey

State Bar No. 10027500

phosey@jw.com

Julia W. Mann

State Bar No. 00791171
vi

jmann@jw.com

Jackson Walker, L.L.P.

112 E. Pecan Street, Suite 2400

San Antonio, TX 78205

(210) 978-7700

(210) 978-7790 (facsimile)

Appellee/Defendant: Blake C. Hoskins

Counsel for Blake C. Hoskins: Ezra A. Johnson

State Bar No. 24065499

ejohnson@ufjblaw.com

Joseph B.C. Fitzsimons

State Bar No. 07099100

jfitzsimons@ufjblaw.com

J. Byron “Trace” Burton, III

State Bar No. 24031776

tburton@ufjblaw.com

Uhl, Fitzsimons, Jewett & Burton, PLLC

4040 Broadway, Suite 430

San Antonio, TX 78209

(210) 829-1660

(210) 829-1641 (facsimile)

Appellee/Defendant: Brent C. Hoskins

Counsel for Brent C. Hoskins: David W. Navarro

State Bar No. 24027683

dnavarro@hsfblaw.com

Brendon C. Holm

State Bar No. 24087737

bholm@hsfblaw.com

Hornberger Sheehan Fuller Bieter

Wittenberg & Garza Incorporated

The Quarry Heights Building

7373 Broadway, Suite 300

San Antonio, TX 78209

(210) 271-1700

(210) 271-1740 (facsimile)
vii

Appellee/Defendant: Hazel Q. Hoskins

(in her individual and representative 

capacities)

Counsel for Hazel Q. Hoskins: Michael C. Sartori

State Bar No. 17655500

michael@msartori.com

Law Office of Michael C. Sartori

P.O. Box 1222

502A Houston Street

George West, TX 78022

(361) 449-2691

(361) 449-2380 (facsimile)

Appellee/Defendant: Jane Hoskins

Counsel for Jane W. Hoskins: Benjamin F. Youngblood, III

State Bar No. 22213700

bfy@prodigy.net

Benjamin F. Youngblood III, P.L.L.C.

8207 Callaghan Road, Suite 100

San Antonio, TX 78230

(210) 308-9829

(210) 308-9854 (facsimile)

Appellee/Third Party Defendant: Aurora Resources Corporation

Counsel for Aurora

Resources Corporation: Roberta S. Dohse

State Bar No. 05955400

rdohse@hfdlaw.com

Conner R. Jackson

State Bar No. 24087786

cjackson@hfdlaw.com

HOBLIT DARLING RALLS HERNANDEZ

 & HUDLOW, LLP

2000 Frost Bank Plaza

802 N. Carancahua

Corpus Christi, TX 78401

(361) 888-9392

(361) 888-9187 (facsimile)
viii

Appellees/Third Party 

Defendants: Armadillo E&P,Inc.

(f/k/a Texoz E&P II, Inc.)

Sea Eagle Ford, LLC

Sundance Energy, Inc.

Counsel for Armadillo E&P, Inc.,

Sea Eagle Ford & LLC

Sundance Energy, Inc.: Bruce D. Oakley

State Bar No. 15156900

Bruce.oakley@hoganlovells.com

Robert L. Pillow

State Bar N. 24080315

Robert.pillow@hoganlovells.com

Hogan Lovells US LLP

700 Louisiana Street, Suite 4300

Houston, TX 77002

(713) 632-1420

(713) 632-1401 (facsimile)

Appellee/Third Party Defendant: Texoz E&P I, Inc.

Counsel for Texoz E&P I, Inc.: Jason A. Newman

State Bar No. 24048689

Jason.newman@bakerbotts.com

Baker Botts L.L.P.

One Shell Plaza

910 Louisiana Street

Houston, TX 77002-4995

(713) 229-1720

(713) 229-2720 (facsimile)
ix

Table of Contents

Identities of Parties & Counsel ...................................................................... ii

Table of Contents .......................................................................................... ix

Index of Authorities ...................................................................................... xi

Cases..............................................................................................xi, xii

Statutes................................................................................................ xii

Rules................................................................................................... xii

Statement of the Case ..................................................................................xiii

Statement Regarding Oral Argument .......................................................... xv

Issues Presented ........................................................................................... xv

Adoption and Incorporation of Brief of Appellees C. Clifton Hoskins 

and Hoskins, Inc.............................................................................................. 1

Statement of Facts .......................................................................................... 2

A. Aurora Serves as Operator for Wells Located on the 

Hoskins and Ray Tracts.............................................................. 2

B. Appellants Sued Aurora for, among other things, the 

Nonpayment of Royalties........................................................... 3

C. As Noted in the Hoskins Appellees’ Statement of Facts, 

the Trial Court Granted Summary Judgment in Favor of 

Hoskins, and Declared Appellants Did Not Have the 

NPIRs in Production from the Hoskins and Ray Tracts ............ 4

D. Aurora’s Traditional Motion for Partial Summary 

Judgment was Granted on a Derivative Basis............................ 5

Summary of the Argument ............................................................................. 5

Argument and Authorities............................................................................... 6

A. The Trial Court Properly Granted Derivative Summary 

Judgment in Favor of Aurora, as the Granting of 

Summary Judgment in Favor of the Hoskins Appellees 

Disposed of any Basis for Recovery Against Aurora ................ 7
x

1. Appellants are Not “Payees” as Defined in the Statute 

Authorizing Non-Payment of Oil and Gas Royalties 

as a Cause of Action.............................................................. 7

2. Any Benefit or Money Retained by Aurora Would 

Not Belong to Appellants...................................................... 8

3. Any Alleged Tortious Interference Could Not Have 

Damaged Appellants........................................................... 10

4. Appellants Had No Possession of or Interest in the 

Property Claimed to Have Been Converted........................ 12

Conclusion ................................................................................................... 13

Prayer ........................................................................................................... 14

Certificate of Compliance ............................................................................ 15

Certificate of Service ..............................................................................15-16

Appendix....................................................................................................... 17
xi

Index of Authorities

Cases

Baty v. Protech Ins. Agency,

63 S.W.3d 841 (Tex. App.—Houston [14th Dist.] 2001, pet. denied)......... 11

Best Buy v. Barrera,

248 S.W.3d 160 (Tex. 2007) (per curiam)...................................................... 9

Cristobal v. Allen, 

2010 Tex. App. LEXIS 5829 (Tex. App.—Houston [1st Dist.] 2010) ........ 10

Delz v. Winfrey, 

16 S.W. 111 (Tex. 1891)......................................................................... 11, 13

Heldenfels Bros., Inc. v. City of Corpus Christi, 

832 S.W.2d 39 (Tex. 1992)....................................................................... 9, 10

J.P. Morgan Chase Bank, N.A. v. Texas Contract Carpet, Inc.,

302 S.W.3d 515 (Tex. App.—Austin 2009, no pet.) .................................. 12

Long Island Owner’s Ass’n, Inc. v. Davidson, 

965 S.W.2d 674, 684 (Tex. App.—Corpus Christi 1998, pet. denied) .......... 6

Massey v. Armco Steel Co.,

652 S.W.2d 932 (Tex. 1983)......................................................................... 11

MGA Ins. Co. v. Charles R. Chesnutt, P.C.,

358 S.W.3d 808, (Tex. App.—Dallas 2012, no pet.) ..................................... 9

Staats v. Miller,

240 S.W.2d 342 (Tex. Civ. App.—Amarillo 1951), rev’d on other

grounds, 150 Tex. 581, 243 S.W.2d 686 (Tex. 1951).................................. 12

Staats v. Miller,

243 S.W.2d 686 (Tex. 1951)..................................................................... 9, 10

Stonebridge Life Ins. Co. v. Pitts,

236 S.W.3d 201 (Tex. 2007) (per curiam)...................................................... 9
xii

Tri-State Chems., Inc. v. Western Organics, Inc.,

83 S.W.3d 189 (Tex. App.—Amarillo 2002, pet. denied)........................ 9, 10

Victoria Bank & Trust Co. v. Brady,

811 S.W.2d 931 (Tex. 1991)......................................................................... 10

Wal-Mart Stores, Inc. v. Sturges,

52 S.W.3d 711 (Tex. 2001)........................................................................... 11

Statutes

TEX. NAT. RES CODE ANN. §91.401 (West 2005)........................................... 8

TEX. NAT. RES CODE ANN. §91.401(1) (West 2005)...................................... 8

TEX. NAT. RES CODE ANN. §91.402 (West 2005)........................................... 8

TEX. NAT. RES CODE ANN. §91.403 (West 2005)........................................... 8

TEX. NAT. RES CODE ANN. §91.404 (West 2005)........................................... 8

TEX. NAT. RES CODE ANN. §91.404(c) (West 2005) ...................................... 8

Rules

TEX. R. APP. P. 9.4 ........................................................................................ 15

TEX. R. APP. P. 9.4(i) .................................................................................... 15

TEX. R. APP. P. 38.1(a)........................................................................................ ii

TEX. R. APP. P. 38.2 ............................................................................................ 1
xiii

STATEMENT OF THE CASE

Appellee Aurora Resources Corporation (“Aurora”) (Third Party Defendant 

below) adopts by reference and incorporates as though fully set forth herein the 

Statement of the Case provided in the Brief of Appellees C. Clifton Hoskins and 

Hoskins, Inc. 

The position of Aurora in this appeal is directly dependent upon this Court’s 

decision as to the merits of the Motion for Summary Judgment (CR 1 at 11-64) by

C. Clifton Hoskins and Hoskins, Inc. (“Hoskins”) and the subsequent amended 

motion (CR 1 at 194-381). The trial court entered an Order granting Hoskins’ 

Amended Motion for Summary Judgment on August 4, 2014. CR 4 at 1077-81; 

Appendix at A. 

Aurora filed its Motion for Summary Judgment on August 25, 2014, 

following the trial court’s Order on Hoskins’ Motion for Summary Judgment. CR

4 at 1155-1256. 

On September 18, 2014, the trial court entered a series of orders, effectively 

resolving nearly all outstanding issues and facilitating Final Judgment in the case. 

The rulings included an Order denying the Joint Motion for Summary Judgment

filed by Aery and House (CR 5 at 1656), an Order denying Aery’s and House’s 

Joint No Evidence Motion for Summary Judgment as to C. Clifton Hoskins’ and 

Blake Hoskins’ Counterclaims (CR 5 at 1654), an Order sustaining objections to 
xiv

certain of Hoskins’ summary judgment evidence (CR 5 at 1658), and an Order 

granting Hoskins’s Objection and Motion to Strike certain of Aery and House’s 

summary judgment evidence (CR 5 at 1651-52). 

Also among the numerous Orders entered on September 18, 2014, was the 

trial court’s Order on Derivative Summary Judgment Motions Based on the August 

4, 2014 Order. CR 5 at 1631-33; Appendix at B. This Order granted summary 

judgment in favor of numerous parties, including Aurora. Id. 

The parties subsequently dismissed cross-claims. See, e.g., Texoz E&P I, 

Inc. and Aurora’s Joint Motion for Entry of Proposed Order Dismissing

Crossclaims dated September 24, 2014 (CR 5 at 1669-72). An Order dismissing 

those cross-claims was entered October 21, 2014. CR 5 at 1685-86; Appendix at 

C. Aurora also nonsuited its counterclaim for declaratory relief on September 26, 

2014. SR at 4-7. The trial court granted this request for nonsuit in the Final 

Judgment entered on October 21, 2014. CR 5 at 1707; Appendix at D. 

Ultimately, all pending cross-claims and counterclaims were dismissed, 

nonsuited or otherwise resolved, enabling the Court to enter a Final Judgment as to 

all claims on October 21, 2014. CR 5 at 1705-1716; Appendix at D. That Final 

Judgment sets out in detail the rationale for its finality, and resolves any remaining 

issues associated with any summary judgment filed by Hoskins. CR 5 at 1705-07; 

Appendix at D. That Final Judgment also clarifies that the Order granting 
xv

summary judgment in favor of Aurora, and others, is derivative of the ruling in 

favor of Hoskins. CR 5 at 1706; Appendix at D. Appellants’ Notice of Appeal 

was timely filed. CR 5 at 1718-22.

In accord with the foregoing, Aurora is aligned with the position of Hoskins 

in this appeal.

STATEMENT REGARDING ORAL ARGUMENT

Appellee Aurora Resources Corporation does not believe that oral argument 

would be of assistance to the Court, as the facts are undisputed and the issues 

presented are wholly a matter of construction of deeds and conveyances. 

However, in the event that the Court elects to grant Appellants’ request for oral 

argument, Appellee Aurora Resources Corporation requests the opportunity to 

participate therein and present argument as well.

ISSUES PRESENTED

Appellants identify two issues on appeal. Aurora adopts the position of 

Hoskins, that there is really only one issue to be resolved:

The ultimate issue presented is whether the 1966 deed from Sam 

Quinn to James House, which described only the 623.93-acre Quinn 

Tract, also conveyed Quinn’s one-quarter (1/4) non-participating 

interests in royalties (“NPIRs”) in the separate Ray Tract and Hoskins 

Tract. 
No. 04-14-00807-CV

__________________________________________________________________

IN THE COURT OF APPEALS

FOURTH COURT OF APPEALS DISTRICT OF TEXAS

SAN ANTONIO, TEXAS

__________________________________________________________________

BRAD AERY, ET AL.,

Appellants

v.

HOSKINS, INC., ET AL.,

Appellees.

__________________________________________________________________

On Appeal from 36th District Court of McMullen County, Texas

Trial Court Cause No. M-12-0045-CV-A

Honorable Starr Boldrick Bauer, Presiding

__________________________________________________________________

BRIEF OF APPELLEE AURORA RESOURCES CORPORATION

__________________________________________________________________

TO THE HONORABLE COURT OF APPEALS:

COMES NOW Appellee, Aurora Resources Corporation (“Aurora”), and 

respectfully submits this its Brief of Appellee pursuant to Rule 38.2 of the Texas 

Rules of Appellate Procedure, and would respectfully show the Court as follows:

I. ADOPTION AND INCORPORATION OF

BRIEF OF APPELLEES C. CLIFTON HOSKINS AND HOSKINS, INC.

Because Aurora’s position in the underlying litigation and in this appeal is 

clearly derivative of the position of Hoskins, Appellee Aurora hereby adopts and 
2

incorporates by reference the Brief of Appellees C. Clifton Hoskins and Hoskins, 

Inc., including the Statement of Facts, Standard of Review, Argument and 

Authorities. To the extent additional specific reference is required as to Aurora, 

that is included below, as an addition to the facts and argument set forth by 

Hoskins. 

II. STATEMENT OF FACTS

Appellee has adopted and incorporated by reference the undisputed facts 

contained in the Brief of Appellees C. Clifton Hoskins and Hoskins, Inc. This 

includes those facts pertaining to the conveyance of the various deeds and 

instruments relating to ownership of and royalty interests in the estates of the 

various tracts comprising 2.471.8-acre ranch ( “The Ranch”), as well as any others 

set out in Hoskins’ Statement of Facts. Aurora would add the following facts 

which are specific to Aurora. 

A. Aurora Serves as Operator for Wells Located on the Hoskins and 

Ray Tracts.

Aurora became involved in this case as result of serving as operator for 

various producing wells on the Hoskins and Ray Tracts. CR 1 at 77-78. Part of 

Aurora’s obligations as operator include the proper and timely payment of royalties 

on the production from these wells. 
3

B. Appellants Sued Aurora for, among other things, the Nonpayment 

of Royalties.

On January 10, 2014, The James House Family filed its Original Petition in 

Intervention, Third-Party Petition, and Application for Injunctive Relief, naming

Aurora and others as Third-Party Defendants. CR 1 at 66. The James House 

Family identifies causes of action for trespass to try title to the mineral estate, 

conversion, declaratory relief, a request for injunctive relief, and a claim for the 

nonpayment of oil and gas proceeds or interest. All causes of action allege the 

same fundamental complaint: non-payment of oil and gas royalties. CR 1 at 78-83

et seq.

Shortly thereafter, the Aery Appellants amended their Petition to add several 

Defendants, including Aurora. Aery similarly raised claims for conversion and 

accounting, unjust enrichment and money had and received, and violation of 

Chapter 91 of the Texas Natural Resources Code. CR 1 at 155-166. The Aery 

Appellants also requested declaratory judgment, claiming they were entitled to 

royalties related to oil and gas production from the Hoskins and Ray Tracts in the 

past, present, and future, and that the NPIR was a valid and existing contractual 

right, passed to the Aery Appellants upon their purchase of the Quinn Tract. CR 1

at 161, et seq.

Appellants’ live pleadings, which mirror one another, allege the following 

causes of action against Aurora: conversion and conspiracy to commit the same; 
4

unjust enrichment and money had & received; tortious interference with existing 

and prospective contracts, and conspiracy to commit the same; and, pursuant to 

Chapter 91 of the Texas Natural Resources Code, non-payment of oil and gas 

proceeds. CR 3 at 1016-1031 et seq. (Aery live Petition); CR 3 at 1033-1059 et 

seq. (House live Plea in Intervention and Third Party Petition). Appellants’ live 

pleadings also seek declaratory and injunctive relief. CR 3 at 1022, 1024-25; CR 3

at 1047-48, 1052-54.

C. As Noted in the Hoskins Appellees’ Statement of Fact, the Trial 

Court Granted Summary Judgment in Favor of Hoskins, and 

Declared Appellants Did Not Have the NPIRs in Production from 

the Hoskins and Ray Tracts.

On August 4, 2014, Judge Starr Boldrick Bauer signed and entered an order 

granting the declaratory relief sought in Defendant C. Clifton Hoskins’s First 

Amended Motion for Partial Summary Judgment. CR 4 at 1077-1078; Appendix at

A. The Court ordered and declared that:

The February 9, 1966 Deed from Sam E. Quinn to James L. House 

conveying the lands of the 623.93-acre Quinn Tract (Vol. 95, pg. 451) 

did not convey Sam E. Quinn’s non-participating royalty interests in 

the Ray Tract and Hoskins Tract, originally established and described 

in that certain November 7, 1963 Partition and Royalty Deed (Vol. 95, 

pg. 357) and subsequently conveyed to Hazel Hoskins and L.R. 

Hoskins by that certain February 11, 1966 Deed from Sam E. Quinn 

to L. R. Hoskins and Hazel Hoskins conveying his non-participating 

royalty interests in Ray Tract and Hoskins Tract. 

Id.
5

In conjunction with this declaration, the Court further ordered that the House 

and Aery Appellants take nothing on their declaratory judgment claims. CR 4 at 

1078; Appendix at A.

D. Aurora’s Traditional Motion for Partial Summary Judgment was 

Granted on a Derivative Basis.

As further noted above, based upon the trial court’s ruling as to Hoskins, 

Aurora moved for summary judgment, arguing that claims raised against Aurora 

all derived from the claims against Hoskins and therefore held no merit. CR 4 at 

1155-1255 et seq. The trial court granted Aurora’s Traditional Motion for Partial 

Summary Judgment and several other summary judgment motions on this same 

derivative basis. CR 5 at 1631-33; Appendix at B.

III. SUMMARY OF ARGUMENT

Aurora has adopted in its entirety the argument and authorities set forth by 

the Hoskins Appellees in their Brief. The trial court did not err when it granted 

summary judgment and derivative summary judgment in favor of Appellees, 

including Aurora. 

The trial court correctly determined that the Aery and House Appellants did 

not acquire non-participating interests in royalties (“NPIRs”) in the Hoskins and 

Ray tracts. The agreement upon which Appellants base their claim is contractual 

in nature. Texas recognizes that cross-conveyances of royalty interests in a 

pooling situation can be valid, but they do not create appurtenant interests in land 
6

not directly owned. Instead, they create a pooled royalty interest in gross.1 Under 

the circumstances of this case, three individual tracts continued to exist, not just 

one. 

Therefore, the Aery and House Appellants are not entitled to royalty on 

production from the Hoskins and Ray Tracts. All claims against Aurora are 

without merit, as the trial court properly found. As a matter of law, derivative 

summary judgment was properly granted in favor of Aurora. The trial court’s 

judgment should in all things be affirmed. 

IV. ARGUMENT AND AUTHORITIES

Aurora Resources Corporation herein incorporates by reference the 

“Argument and Authorities” contained in Appellee C. Clifton Hoskins’ Brief. For 

the reasons set forth therein, the transfer of property to Appellants through the 

Quinn Deed did not expressly convey Quinn’s NPIRs in the Ray Tract or the 

Hoskins Tract. Further, it did not impliedly convey Quinn’s NPIRs in the Ray 

Tract or the Hoskins Tract as appurtenances. 

Appellee Aurora Resources also adds the following argument appropriate to 

the derivative claims asserted by Appellants against Aurora.

 

1 An appurtenant interest attaches to the land; an interest in gross is personal and does not pass 

with the land. See Long Island Owner’s Ass’n, Inc. v. Davidson, 965 S.W.2d 674, 684 (Tex. 

App.—Corpus Christi 1998, pet. denied).
7

A. The Trial Court Properly Granted Derivative Summary 

Judgment in Favor of Aurora, as the Granting of Summary 

Judgment in Favor of the Hoskins Appellees Disposed of any 

Basis for Recovery Against Aurora. 

In their Opening Brief, Appellants do not address the appropriateness of the 

derivative summary judgment granted by the trial court in favor of Aurora. 

Nevertheless, in the event that Appellants challenge this grant of summary 

judgment in favor of Aurora or any other Appellee, Appellee Aurora would refer 

this Court to its underlying Motion for Partial Traditional Summary Judgment (CR 

4 at 1155-1255), which sets out in detail the basis on which the trial court could 

properly rule that all causes of action and relief sought from Aurora are premised 

upon Appellants’ entitlement to royalties. The trial court properly declared 

Appellants had no interest in the Hoskins or Ray Tracts. Appellants therefore have 

no basis for claiming that they have not properly been paid for royalty interests 

they do not possess.

1. Appellants are Not “Payees” as Defined in the Statute 

Authorizing Non-Payment of Oil and Gas Royalties as a Cause 

of Action. 

Aurora was properly granted summary judgment regarding Appellants’

claims of non-payment of oil and gas royalties on the basis that Appellants are not 

entitled to payments of oil and gas royalties in dispute, and thus are not “payees” as 

defined by the statute establishing a cause of action for non-payment of oil and gas

royalties.
8

Nonpayment of oil and gas proceeds or interest is a statutory cause of action 

provided in Section 91.404 of the Texas Natural Resources Code whereby a 

statutorily-defined “payee” “has a cause of action for nonpayment of oil or gas 

proceeds or interest on those proceeds as required Section 91.402 or 91.403 of [the 

Texas Natural Resource Code]....” TEX. NAT. RES. CODE ANN. §91.404(c) (West 

2005). The trial court correctly determined that Appellants are not “payees.”

Texas Natural Resources Code Chapter 91, Subchapter J, Payment For 

Proceeds Of Sale, defines “payee” as “any person or persons legally entitled to 

payment from the proceeds derived from the sale of oil or gas from an oil or gas 

well located in this state.” TEX. NAT. RES CODE ANN. §91.401(1) (West 2005). 

Appellants are not legally entitled to payment of proceeds derived from the sale of 

oil or gas from wells located on either the Ray or Hoskins Tracts of the Ranch, as 

they have no NPIRs or other royalty interests therein. CR 4 at 1077-78; Appendix 

at A. Appellants are therefore not “payees” as defined by §91.401, and summary 

judgment in favor of Aurora was properly granted as to Appellants’ claims for nonpayment of oil and gas royalties. TEX. NAT. RES CODE ANN. §91.401(1) (West 

2005). 

2. Any Benefit or Money Retained by Aurora Would Not Belong 

to Appellants.

Appellants further asserted a claim against Aurora for unjust enrichment and 

money had and received. CR 3 at 1023; CR 3 at 1049. Even if Aurora has 
9

retained any benefit from this dispute, which it denies, it would not be to the 

detriment of Appellants, who have no interest in the disputed royalties.

Unjust enrichment is a theory of recovery that applies when a defendant has 

obtained a benefit from the plaintiff by fraud, duress, or the taking of an undue 

advantage. See Heldenfels Bros., Inc. v. City of Corpus Christi, 832 S.W.2d 39, 41 

(Tex. 1992). Unjust enrichment may take the form of the unjust retention of a 

benefit to the detriment of another person or the unlawful retention of money or of 

other personal property belonging to another person. Tri-State Chems., Inc. v.

Western Organics, Inc., 83 S.W.3d 189, 199 (Tex. App.—Amarillo 2002, pet.

denied).

Similarly, a claim for money had and received requires proof that a 

defendant holds money which belongs to the plaintiff in equity and good 

conscience. MGA Ins. Co. v. Charles R. Chesnutt, P.C., 358 S.W.3d 808, 813

(Tex. App.—Dallas 2012, no pet.). It is an equitable doctrine applied to prevent 

unjust enrichment. Id.; see Stonebridge Life Ins. Co. v. Pitts, 236 S.W.3d 201, 203

at n.1 (Tex. 2007) (per curiam). A plaintiff must show that the defendant holds

money or its equivalent that in equity and good conscience belongs to the 

plaintiff. Best Buy v. Barrera, 248 S.W.3d 160, 162–163 (Tex. 2007) (per 

curiam); Staats v. Miller, 243 S.W.2d 686, 687 (Tex. 1951); see Tri-State Chems.,

83 S.W.3d at 194-95 (equivalent of money may be recovered). 
10

Appellants have no royalty interest in production from the Hoskins or Ray 

Tracts. As such, any money or other benefit Aurora may hold from production of 

oil and gas on the Ray Tract or the Hoskins Tract, which Aurora denies, does not 

belong to Appellants either legally or in equity. See Staats, 243 S.W.2d at 687; 

Tri-State Chems., 83 S.W.3d at 199. As the oil and gas, or any monetary 

equivalent such as royalties, do not belong to Appellants, any withholding or 

benefit received by Aurora has not been obtained from Appellants. See Cristobal 

v. Allen, 2010 Tex. App. LEXIS 5829, *16-17 (Tex. App.—Houston [1st Dist.] 

2010) (citing Heldenfels Bros., Inc., 832 S.W.2d at 41). As Appellants are not an 

aggrieved party, summary judgment was properly granted in favor of Aurora with 

respect to Appellants’ causes of action of unjust enrichment and money had and 

received.

3. Any Alleged Tortious Interference Could Not Have Damaged

Appellants.

The elements of a cause of action for tortious interference with an existing 

contract are: (1) the existence of a contract subject to interference; (2) a willful and 

intentional act of interference; (3) such act was a proximate cause of damage; and 

(4) actual damage or loss occurred. Victoria Bank & Trust Co. v. Brady, 811

S.W.2d 931, 939 (Tex. 1991). 

The elements of a cause of action for tortious interference with a prospective 

contract are: (1) a reasonable probability that the parties would have entered into a 
11

contractual relationship; (2) an “independently tortious or unlawful” act by the 

defendant that prevented the relationship from occurring; (3) the defendant did

such act with a conscious desire to prevent the relationship from occurring or knew

that the interference was certain, or substantially certain, to occur as a result of his

conduct; and (4) the plaintiff suffered actual harm or damage as a result of the

defendant's interference. Wal-Mart Stores, Inc. v. Sturges, 52 S.W.3d 711, 726

(Tex. 2001); Baty v. Protech Ins. Agency, 63 S.W.3d 841, 860 (Tex. App.—

Houston [14th Dist.] 2001, pet. denied). 

Finally, a conspiracy is a combination by two or more persons to accomplish 

an unlawful purpose or to accomplish a lawful purpose by unlawful means. 

Massey v. Armco Steel Co., 652 S.W.2d 932, 934 (Tex. 1983). The essential

elements of a conspiracy include one or more unlawful, overt act and damages as 

the proximate result. Id. If a plaintiff is incapable of sustaining a separate action 

against a defendant on account of the matter complained of, then a charge of 

conspiracy will not sustain it alone. Delz v. Winfrey, 16 S.W. 111, 112 (Tex. 

1891). In other words, the act complained of as accomplished or attempted to be 

accomplished through the conspiracy must be actionable itself. Id.

Aurora has done no tortious act, much less an intentional act of interference, 

and has not caused damages to Appellants. Appellants have no royalty interests in 

production from the Hoskins or Ray Tracts. CR 4 at 1077-78; Appendix at A. 
12

Because Appellants had no such interests, they cannot as a matter of law have 

suffered any damages from the nonpayment of monies to which they are not 

entitled. 

Because an element of Appellants’ tortious interference claim fails as a 

matter of law, and the alleged tortious conduct underlying Appellants’ claim for 

conspiracy is not actionable, summary judgment in favor of Aurora disposing of 

Appellants’ claims of tortious interference and conspiracy to commit the same was 

properly granted.

4. Appellants Had No Possession of or Interest in the Property 

Claimed to Have Been Converted. 

Conversion is an offense against the possession of property. Staats v. Miller,

240 S.W.2d 342, 345 (Tex. Civ. App.—Amarillo 1951), rev’d on other grounds,

150 Tex. 581, 243 S.W.2d 686 (Tex. 1951). If the plaintiff did not or does not 

own, possess, or have the right to possession of property, the plaintiff has no 

property interest and cannot sue for conversion. J.P. Morgan Chase Bank, N.A. v.

Texas Contract Carpet, Inc., 302 S.W.3d 515, 536-39 (Tex. App.—Austin 2009,

no pet.). This is self-evident. Here, the property in question, oil and gas produced 

from the Ray and Hoskins Tracts, is not the property of Appellants. CR 4 at 1077-

78; Appendix at A. As such, a claim that Aurora converted property in which 

Appellants have no possessory rights or entitlement of any other nature necessarily 
13

fails. Moreover, as Appellants’ conversion claims cannot be sustained, neither can 

Appellants’ claims of conspiracy to commit conversion. See Delz, 16 S.W. at 112.

Based on the foregoing, summary judgment was properly entered in favor of 

Aurora and against Appellants’ claims for conversion and conspiracy to commit 

conversion.

V. CONCLUSION

The trial court’s Order granting summary judgment in favor of C. Clifton 

Hoskins and Hoskins, Inc. reflects the proper construction and interpretation of the 

relevant deeds and conveyances as it relates to the royalty interests at issue. 

Because the issue centers on the interpretation and construction of written deed and 

agreements, the question presented is inherently one of law, and the trial court was 

within its rights and discretion to make such a ruling. 

Appellants raise no argument in their Opening Brief regarding the fitness of 

the trial court in granting derivative summary judgment. Appellants’ claims, 

including those against Aurora, are entirely conditioned upon ownership of 

relevant royalty interests. The trial court determined those interests do not belong 

to Appellants. The trial court further acted properly, and in accordance with 

controlling legal principles, by granting derivative summary judgment in favor of 

Aurora and all other appellees. Accordingly, as to Aurora and all other appellees, 

the Final Judgment entered by the trial court should be upheld in all respects.
14

VI. PRAYER

WHEREFORE, Appellee Aurora Resources Corporation respectfully 

requests that the trial court’s judgment in all things be affirmed, including the 

granting of summary judgment in favor of Appellee Aurora. Appellee further 

prays for such other and further relief to which it may be justly entitled.

Respectfully submitted, 

HOBLIT DARLING RALLS HERNANDEZ

 & HUDLOW, LLP

2000 Frost Bank Plaza

802 N. Carancahua

Corpus Christi, TX 78401

(361) 888-9392

(361) 888-9187 (facsimile)

/s/ Roberta S. Dohse

Roberta S. Dohse

State Bar No. 05955400

rdohse@hfdlaw.com

Conner R. Jackson

State Bar No. 24087786

cjackson@hfdlaw.com

Counsel for Appellee

Aurora Resources Corporation
15

CERTIFICATE OF COMPLIANCE

I hereby certify that this Appellees’ Brief has been computer-generated, 

using Word by Microsoft, in 14-point font, Times New Roman, in accord with 

TEX. R. APP. P. 9.4, and that the number of words in this document totals 

approximately 2,920, excluding the caption, identity of parties and counsel, 

statement regarding oral argument, table of contents, index of authorities, 

statement of the case, statement of issues presented, statement of jurisdiction, 

statement of procedural history, signatures, proof of service, this certificate of 

compliance, and any appendix (as is permitted by and in compliance with Tex. R. 

App. P. 9.4(i)). 

/s/ Roberta S. Dohse

Roberta S. Dohse

Counsel for Appellees

CERTIFICATE OF SERVICE

I hereby certify that a true and correct copy of Appellees’ Brief has been 

forwarded to all counsel of record, via U.S. Postal Services, Certified Mail, return 

receipt requested, and/or via electronic filing, on this the 20th day of May, 2015.

Dan Pozza

Law Offices of Dan Pozza

239 E. Commerce Street

San Antonio, TX 78205-2923

Marc K. Whyte

Whyte, PLLC

209 Tuttle

San Antonio, TX 78209

Melanie Hessler Phipps

Kustoff & Phipps, LLP

4103 Parkdale Street

San Antonio, TX 78229-2520

John George, Jr.

Matthew F. Wymer

Bierne Maynard & Parson, LLP

112 East Pecan Street, Suite 2750

San Antonio, TX 78205

Rosemarie Kanusky

John W. Weber, Jr.

Jeffrey A. Webb

Norton Rose Fulbright

300 Convent St., Suite 2100

San Antonio, TX 78205
16

C. David Kinder

Corey F. Wehmeyer

Amy Davis

Benjamin Robertson

Lindsay Scaief Riley

Ellen B. Mitchell

Dykema Cox Smith

112 East Pecan, Suite 1800

San Antonio, TX 78205

Michael C. Sartori

Law Office of Michael C. Sartori

P.O. Box 1222

502A Houston Street

George West, TX 78022

David L. Ylitalo

Coats Rose PC

1020 Northeast Loop 410, Suite 800

San Antonio, TX 78209

Peter E. Hosey

Julia W. Mann

Jackson Walker, L.L.P.

112 E. Pecan Street, Suite 2400

San Antonio, TX 78205

Ezra A. Johnson

Joseph B.C. Fitzsimons

J. Byron “Trace” Burton, III

Uhl, Fitzsimons, Jewett 

& Burton, PLLC

4040 Broadway, Suite 430

San Antonio, TX 78209

/s/ Roberta S. Dohse

Roberta S. Dohse
17

APPENDIX

Exhibit A Order Granting Defendant C. Clifton Hoskin’s First Amended Motion 

for Partial Summary Judgment (August 4, 2014) (CR 4 at 1077-81) 

Exhibit B Order on Derivative Summary Judgment Motions Based on August 4, 

2014 Order (September 18, 2014) (CR 5 at 1631-33) 

Exhibit C Agreed Order Dismissing Texoz E&P I, Inc.’s and Aurora Resources 

Corporation’s Cross-Claims for Contribution Without Prejudice

(October 21, 2014) (CR 5 at 1685-86) 

Exhibit D Final Judgment (entered October 21, 2014) (CR 5 at 1705-1716)