Court Opinion

ID: 9791647
Source: CourtListenerOpinion
Date Created: 2023-08-31 02:15:15.282664+00
Date Added: 2024-06-11T07:37:37.612755
License: Public Domain

FRANCHINI, Justice (dissenting). It is my opinion that Roseline Abraham never assigned, conveyed or divested herself in any manner of the option to repurchase; and that PWG never contracted or bargained for the option. Assignment Although it is not affirmatively stated, I conclude that the majority agrees that Texas law applies to the subject case. I view Prochemco in a different light than either the majority or the appellant. It seems to me that Prochemco, Inc. had a real property interest as the landowner (through its wholly-owned subsidiary) and a personal property interest as the holder of an option to extend the contract. Whether or not Prochemco’s option was assignable was the controlling factor in that dichotomy. Subsequently, the wholly-owned subsidiary conveyed a 99% interest in the land to a third party. Prochemco then quitclaimed to the third party all of its right, title, and interest in the land. Prochemco, Inc. v. Clajon Gas Co., 555 S.W.2d 189 (Tex.Civ.App.1971), writ refd n.r.e. The third party asserted that since the interests were conveyed, Prochemco no longer had an option that could be exercised under the theory that the option had run with the land. The difference between the two cases is that the option in Prochemco was for the benefit of the land and thus was held to run with the land. The option in the instant case was for the direct benefit of the Abrahams and therefore a personal covenant. If, in fact, the Texas Court had considered the option to be conveyed along with any right title and interest that Prochemco had in the real property, then the quitclaim deed would have conveyed any rights under the option as well. The Court, however, found that it did not and that the option had survived that conveyance. The majority bases its opinion upon the assignment of the option to repurchase by the Abrahams in the transfer agreement of May 29, 1963. The general rule in Texas law is that personal property does not pass in the assignment of an oil and gas lease unless it is expressly passed. OTC Petroleum Corp. v. Brock Exploration Corp., 835 S.W.2d 792 (Tex.Civ.App.1992) (citing Phillips Petroleum Co. v. Adams, 513 F.2d 355, 363 (5th Cir.), cert. denied, 423 U.S. 930, 96 S.Ct. 281, 46 L.Ed.2d 259 (1975)). In that agreement there is no specific conveyance of personal property or the option. From these facts, I conclude that unless expressly enumerated, a conveyance of real property (fee simple or lease) does not include options that a person may possess that are personal and do not run with the land. The majority then extensively analyzes the conduct of Mike Abraham as to his interest in the repurchase option. I consider this to be immaterial. The party in interest in this suit is the Estate of Roseline Abraham. Roseline was not a party to the 1964 bankruptcy plan proposed by Mike Abraham. Whatever representations made by Mike Abraham within that plan are not binding upon Roseline. At no time from 1951 through her death did Roseline expressly convey her interest in the option nor did she represent to any party that she had conveyed such an interest. The reasoning of the majority stretches to impute the conduct and intentions of all the other parties, without express or implied authority, to Roseline. There is no theory of law in Texas or New Mexico that I am aware of that would allow that result. Intent Texas law emphasizes, as a threshold analysis, the ambiguity of an assignment or conveyance. OTC Petroleum Corp., 835 S.W.2d at 794. “To ascertain the objective intention of the parties, the courts examine and consider the entire writing, seeking to harmonize and give effect to all the provisions of the contract so that none will be rendered meaningless.” Id. (citing Universal C.I.T. Credit Corp. v. Daniel, 150 Tex. 513, 243 S.W.2d 154 (1951)). Nowhere in the transfer is there an express conveyance of the option to PWG or is there any indication that PWG bargained for that conveyance. I, therefore, conclude that there was no objective intention to convey the option. Presumed Grant The majority refers in two instances to the “possession” of the option by PWG. That is an interesting concept. Perhaps if the Abraham’s had assigned their interests in their original mineral lease agreement then there would have been an argument that PWG possessed the option. That is not the case. In the benchmark case in New Mexico concerning presumed grant, Justice Brice references a property treatise on presumptive grant which states that “[t]his rule is based upon the assumption that if there had been no grant, the owner would have put an end to the wrongful occupation before the full period of limitation had expired.” Hester v. Sawyers, 41 N.M. 497, 502, 71 P.2d 646, 651 (1937). An even more interesting question is how do you occupy an option. Roseline had no notice that PWG believed themselves to be the owner of the option. Upon notice that the conditions of the option had been met, Roseline immediately exercised her option. What action could she have been expected to take before that time? And since the option had not been bargained for or expressly documented in any of the agreements, she could not have been expected to contest its ownership. It is significant that in applying such an extraordinary doctrine as presumed grant through prescriptive easement, Justice Brice required the prescription be “open, uninterrupted, peaceable, notorious, adverse, under claim of right, and continue for a period of ten years with the knowledge or imputed knowledge of the owner.” Id. at 504, 71 P.2d at 653. The majority opinion does not demonstrate how the actions of PWG meet these requirements. The Texas law cited by the majority is similar. It requires three elements in order for a presumption of grant to arise: (1) “long asserted and open claim, adverse to the apparent owner, ... (2) non-claim by the apparent owner, ... [and] (3) acquiescence by the apparent owner in the adverse claim.” Magee v. Paul, 110 Tex. 470, 221 S.W. 254, 256 (1920) (quoting from the majority). I can find no evidence in the record which demonstrates that PWG openly asserted a claim for any period of time. The only evidence in the record demonstrates that Rose-line claimed her interest in the option as soon as she became aware that she could claim it. I see no reason to apply the doctrine of presumed grant. Without it, there is no assignment, conveyance or any divesting action by Roseline. She exercised her option in October of 1989 and had no reason to take any other action until that time. I would reverse and set aside the judgement of the District Court because to do otherwise gives PWG a valuable interest that they never contracted or bargained for. For all of the above reasons, I dissent.