Case Name: TEMPLE-INLAND FOREST PRODUCTS CORPORATION, Vernon Wells, Mildred Maguire, Joyce Lilley, Myrtle Wells Bailey, Buddie Wells, Pete B. Wells, Margaret V. Gunter, Patsy Shaw, Margaret Jane Ashmore Cohen and Clarence Eugene Irvin, By and Through His Appointed Guardian, Linda Cansler, Appellants, v. HENDERSON FAMILY PARTNERSHIP, LTD., Katharine Henderson McGraw, and Husband, Bill F. McGraw, and A.DJ. Partnership, Ltd., Appellees
Court: Texas Courts of Appeals
Jurisdiction: Texas
Decision Date: 1995-11-30
Citations: 911 S.W.2d 531
Docket Number: No. 09-94-274 CV
Parties: TEMPLE-INLAND FOREST PRODUCTS CORPORATION, Vernon Wells, Mildred Maguire, Joyce Lilley, Myrtle Wells Bailey, Buddie Wells, Pete B. Wells, Margaret V. Gunter, Patsy Shaw, Margaret Jane Ashmore Cohen and Clarence Eugene Irvin, By and Through His Appointed Guardian, Linda Cansler, Appellants, v. HENDERSON FAMILY PARTNERSHIP, LTD., Katharine Henderson McGraw, and Husband, Bill F. McGraw, and A.DJ. Partnership, Ltd., Appellees.
Judges: Before WALKER, C.J., and BURGESS and STOVER, JJ.
Reporter: South Western Reporter Second Series
Volume: 911
Pages: 531–538

Head Matter:
TEMPLE-INLAND FOREST PRODUCTS CORPORATION, Vernon Wells, Mildred Maguire, Joyce Lilley, Myrtle Wells Bailey, Buddie Wells, Pete B. Wells, Margaret V. Gunter, Patsy Shaw, Margaret Jane Ashmore Cohen and Clarence Eugene Irvin, By and Through His Appointed Guardian, Linda Cansler, Appellants, v. HENDERSON FAMILY PARTNERSHIP, LTD., Katharine Henderson McGraw, and Husband, Bill F. McGraw, and A.DJ. Partnership, Ltd., Appellees.
No. 09-94-274 CV.
Court of Appeals of Texas, Beaumont.
Nov. 30, 1995.
Rehearing Overruled Jan. 4, 1996.
Linda C. Cansler, Beaumont, Robert G. Osborn, Lufkin, for appellants.
Alan M. McGraw, Rash, Laney, Chapman, Schreiber & Porter, Austin, for appellees.
Before WALKER, C.J., and BURGESS and STOVER, JJ.

Opinion:
OPINION
STOVER, Justice.
This is an appeal from a final summary judgment rendered in a declaratory judgment action concerning the construction of two mineral deeds. This appeal comes from the First District Court in and for Newton County, Texas. Appellees in this case are Henderson Family Partnership, LTD., Katharine Henderson McGraw and husband, Bill F. McGraw, and A.D.J. Partnership, LTD., hereinafter referred to as appellees. Appellants are Temple-Inland Forest Products Corporation, Vernon Wells, Mildred Ma-guire, Joyce Lilley, Myrtle Wells Bailey, Buddie Wells, Pete B. Wells, Margaret V. Gunter, Patsy Shaw, Margaret Jane Ash-more Cohen and Clarence Eugene Irvin, by and through his appointed Guardian, Linda Cansler, hereinafter called appellants.
The undisputed facts of this case show that on April 30, 1938, J.S. Ashmore, a single man, C.N. Ashmore and wife, Julia Ashmore, Walter Ashmore and wife, Florence Ash-more, and Olar Wells, a feme sole, executed and delivered a deed to forty (40) mineral acres to D.M. Henderson and R.W.
Henderson. Also, on April 30, 1938, C.N. Ashmore and wife Julia Ashmore, executed and delivered a deed to forty (40) mineral acres to D.M. Henderson and R.W.
Henderson. These deeds were filed of record in the Deed Records of Newton County, Texas. Although the basic facts underlying the present litigation are undisputed, the law applicable to those facts generates this appeal.
The two mineral deeds in question contain identical granting clauses as follows:
. have granted, bargained, sold, conveyed, transferred, set over and delivered, and by these presents do grant, bargain, sell, convey, transfer, set over and deliver unto the said Grantee, an undivided fifteen-sixteenths (%ths) interest in, to and of all oil, gas and other minerals, whether similar or dissimilar, on, in, under and that may be produced from the following described land .
Pertinent provisions of these deeds regarding the reservation of interest by grantors are as follows:
In respect to the undivided one-sixteenth (⅝⅛) part of and interest in the oil, gas and other minerals retained and reserved by the Grantor in said land, it is understood and agreed that said one-sixteenth (⅜⅛) interest is and shall always be a royalty interest, and shall not be charged with any of the costs which the Grantee may incur in exploring, drilling, mining, developing and operating wells or mines for the production of oil, gas and other minerals; and, if the Grantee, or his heirs, executors, assigns or any person or concern to whom the Grantee shall give an oil and gas mining lease thereon, shall, by his or their explorations and operations, discover and produce oil, gas and other min- erais, the Grantor's one-sixteenth ⅜⅛) royalty interest above referred to shall be delivered free of cost to the Grantor at the wells or mines or to the credit of Grantor in pipe lines or storage provided by the Grantor. It is expressly understood that the Grantee shall never be required to, under any covenant or obligation, whether express or implied, to drill or operate on said lands or any part thereof for the discovery of or production of oil, and other minerals, before and after discovery, shall be solely at the Grantee's option and election, and that any wells or mines discovered or drilled by the Grantee may be abandoned or operated by him at any time at his election or discretion; provided, that before Grantor's royalty shall be calculated and determined, all oil, gas and other minerals used for light, heat and operations by the Grantee and any taxes against the production shall be first deducted.
The rights and interests herein granted, created and reserved shall extend to the respective heirs, executors, administrators, successors and assigns of the parties hereto, it being agreed that the Grantor shall not be required to join in or ratify any oil and gas mining lease which the Grantee may grant by virgue [sic] of his ownership hereunder and that Grantor shall be entitled to none of the bonus money therefor and to no part of the delay rentals paid thereunder; it being further understood that any change of ownership of the one-sixteenth (foth) royalty belonging to Grantor, whether effected by conveyance, will, partition or otherwise, shall entitle the respective owners only to their proportionate part of said royalty, .
The single issue before the trial court and now before this Court of Appeals is a pure question of law: What interests were reserved to Grantors in these mineral deeds?
Appellees contend that the one-sixteenth (⅜⅛) interests reserved in the mineral deeds are either one-sixteenth (⅜⅛) mineral interests or, alternatively, one-sixteenth (¾⅛) "of royalty" interests. Appellants' position is that the reserved interests in both mineral deeds are one-sixteenth (⅜⅛) fixed royalty interests. Significantly, appellees are the successors in interest to, and hold title under, the Grantees in these mineral deeds. Appellants are the successors in interest to, and hold title under, the Grantors in the mineral deeds.
Both appellants and appellees filed Motions for Partial Summary Judgment on their respective declaratory judgment actions. The district court, by letter dated the 22nd day of December, 1993, notified the parties that it was denying appellants' motion and granting appellees' motion and finding that the interest reserved was a ¾6⅛ mineral interest. Thereafter, the remaining causes of action asserted by all parties, consisting of claims for attorneys' fees and court costs, were dismissed by Agreed Motion and Order. All issues before the trial court were resolved, a final judgment was then rendered in favor of appellees on June 27, 1994. The district court in final judgment, declared, adjudged and decreed, that the interests reserved in the Mineral Deeds were one-sixteenth Oieth) mineral interests. Appellants make their appeal from the entry of this judgment bringing to this Court five points of error. The thrust of all appellants' points of error are directed to the trial court's granting of summary judgment favorable to appellees and the trial court's application of appropriate rules of construction regarding these mineral deeds.
MINERAL DEEDS — RULES OF CONSTRUCTION
Since neither appellants nor appellees contend that the mineral deeds in question are ambiguous, the construction of these deeds is therefore a question of law for the Court's determination. See Luckel v. White, 819 S.W.2d 459, 461 (Tex.1991); Altman v. Blake, 712 S.W.2d 117, 118 (Tex.1986).
Canons of Construction have developed over the years, but have generally tried to achieve one important goal: determine the intent of the parties from the instrument itself. "The primary duty of a court when construing such a deed is to ascertain the intent of the parties from all of the language in the deed by a fundamental rule of construction known as the 'four corners' rule." Luckel v. White, 819 S.W.2d at 461. Although the goal has stayed the same, the rules used to achieve that goal have continuously evolved.
Distinguishing royalty interests from mineral interests requires the application of certain rules. As stated, we must look to the intent of the parties for interpretation. We first examine the granting clause to determine intent. Here we have the grantors conveying (granting) %ths interest in the oil, gas and other minerals, and have by choice reserved a ⅜⅛ of the oil, gas, and other minerals.
Here we are called upon to interpret a deed where the Grantors reserve a ⅛⅛ mineral interest, later convey four of the attributes of that interest, raising the question, what have the Grantors retained. Currently, the Supreme Court has adopted a two-tiered approach to construing deeds. First, "if different parts of the deed appear contradictory or inconsistent, the court must strive to harmonize all of the parts.... " Id. at 462. Second, if the court cannot harmonize the deed, the "the court should 'not strike down any part of the deed unless there is an irreconcilable conflict wherein one part of the instrument destroys in effect another part thereof.'" Id. That is, if the deed is in irreconcilable conflict, then the court is instructed to "strike down" parts of the deed. To accomplish this task, we invoke the Canons of Construction.
A mineral interest has five attributes. Those five attributes are: (1) the right to develop; (2) the right to lease; (3) the right to receive bonus payments; (4) the right to receive delay rentals; and (5) the right to receive royalty. Each one of these attributes is a separate, distinct property interest that may be conveyed or it may be reserved in connection with a conveyance of a mineral interest. In Prairie Producing Co. v. Schlachter, 786 S.W.2d 409, 412 (Tex.App.—Texarkana 1990, writ denied), the court held that when an owner conveys a mineral estate, all attributes are impliedly transferred as well unless they were specifically reserved to the grantor. The recent case by the Supreme Court (March 30, 1995) of French v. Chevron, 896 S.W.2d 795 (Tex.1995), addresses the interpretation of mineral deeds. The Supreme Court reexamined all the landmark cases on the Canons of Construction of mineral deeds.
The conflict interpreted by the Supreme Court was in reconciling language in paragraph 1 which appeared to convey a mineral estate, with language in paragraph 2 which implicitly stated there was a royalty interest being conveyed. The court concluded, after applying the Canons of Construction, that the meaning of the deed was to convey "[a] mineral interest stripped of appurtenant rights other than the right to receive royalties." Id. at 798. Viewing the deed from the four corners the Supreme Court concluded the parties intended to convey a mineral interest with reservation, thus conveying only the royalty portion of the mineral interest.
In the instant case we have here the reverse, rather than conveying, the grantors reserved interest in the mineral estate. As we apply the Canons of Construction in examining the deeds in question, we find the grantors (1) conveyed the right to develop; (2) conveyed the right to lease; in other words, they have conveyed their executive rights; (3) conveyed their right to bonus and conveyed their (4) right to delay rental. Under the deeds in question, the grantors gave up the right to develop, lease, receive bonus payments, and receive delay rentals. If the parties had intended the ⅝⅛ retained interest to be a fixed royalty interest, there would have been no need to grant these attributes to the grantee. These attributes would have automatically passed without a grant of the mineral interest. Only when the parties intended that the ⅝⅛ interest retained to be a mineral interest was it necessary to make such a grant. If the Grantors actually intended to grant 100 percent of the mineral interest and retain a %th royalty, then they would have done just that: the granting clause would have granted all minerals (⅝ ths), and separately reserved a ⅝⅛ royalty.
The intermediate court in French v. Chevron also determined that the reference to the royalty interest was insufficient to create a royalty interest: "Even the language 'this conveyance is a royalty interest only' cannot serve to create a royalty interest without an express reference to royalties for actual production of minerals, the controlling factor in Watkins. " French v. Chevron U.S.A., Inc., 871 S.W.2d 276, 278-279 (Tex.App.—El Paso 1994). Here the deeds do not refer to a royalty from actual production as required by French and Altman, supra.
An additional rule of construction is the requirement that a deed should be construed against the grantor so as to convey the greatest estate possible. In Garrett v. Dils Co., 157 Tex. 92, 299 S.W.2d 904, 906 (1957), the Supreme Court held that "[a]n-other applicable rule is that should there be any doubt as to the proper construction of the deed, that doubt should be resolved against the grantors."
Here the deeds reserved a mineral interest by the mechanism of granting a fractional mineral estate followed by additional grants. Thus, of the five attributes of a mineral interest, grantors have conveyed four and reserved one. Grantors have reserved a !⅛⅛ mineral interest, with the executive rights passing to the Grantees, thus, we hold from the four corners of the document that the parties intended to retain a %th mineral interest stripped of appurtenant rights other than the right to receive royalties. This harmonizes and gives effect to all portions of the deed.
Appellants raise five points of error, and argue all five collectively. All five points of error involve the construction of the deeds which we have resolved contrary to appellants' argument. Accordingly, appellants' points of error are overruled.
Judgment of the trial court is affirmed. AFFIRMED.
. Watkins v. Slaughter, 144 Tex. 179, 189 S.W.2d 699 (1945).