Union Pacific Railroad Company v. Ameriton Properties Incorporated ( 2014 )

Opinion issued October 2, 2014
In The
Court of Appeals
For The
First District of Texas
————————————
NO. 01-13-00811-CV
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UNION PACIFIC RAILROAD COMPANY, Appellant
V.
AMERITON PROPERTIES INCORPORATED, Appellee
On Appeal from the 281st District Court
Harris County, Texas
Trial Court Case No. 2012-03918
OPINION
Ameriton Properties Incorporated sought a declaratory judgment that it
owned a strip of land in western Houston and that Union Pacific Railroad
Company’s only interest in that land was a now-abandoned right of way. Union
Pacific counterclaimed, seeking a declaratory judgment that it owned an undivided
fee interest in the land pursuant to an 1879 deed and seeking its attorney’s fees.
Ameriton moved for summary judgment, which the trial court granted as to
ownership of the land and denied as to attorney’s fees and costs. Union Pacific
filed two motions for partial summary judgment, one regarding ownership and one
regarding Ameriton’s entitlement to attorney’s fees, both of which the trial court
denied. Ameriton moved for judgment based on these orders and the parties’
agreement as to necessary attorney’s fees. The trial court then entered a final
judgment declaring that Union Pacific’s only interest in the property was an
abandoned right of way and that Ameriton owns the property free and clear of any
claims by Union Pacific and awarding Ameriton its attorney’s fees. Union Pacific
appeals. We reverse and remand to the trial court for further proceedings.
Background
Disputes over the property in question stretch back more than 130 years.
They began when, in the late 1800s, the Galveston, Harrisburg and San Antonio
Railway Company (G.H.S.A.) condemned a right of way across a strip of land in
western Houston. Union Pacific is the successor in interest to G.H.S.A. At the
time of the condemnations, Thomas Hart and S.E. Lawrence owned a one-half
undivided interest in the land in question, and the estate of John Lawrence owned
the remaining one-half undivided interest. Ameriton is the successor in interest to
Hart, S.E. Lawrence, and John Lawrence’s heirs.
2
G.H.S.A. successfully condemned the right of way as to the one-half interest
held by Hart and S.E. Lawrence. The nature of the interest obtained through that
condemnation proceeding is not at issue in this appeal.
G.H.S.A. also condemned the interest held by the estate of John Lawrence,
but G.H.S.A. and the administratrix of the estate, Mary E. Lawrence (“Mary”),
settled the dispute while the decision was on appeal. See Galveston, H. & S.A. Ry.
Co. v. Blakeney, 11 S.W. 174, 174 (Tex. 1889). In 1879, to settle her dispute with
G.H.S.A., Mary, on behalf of the estate, executed a deed, granting an interest in the
land to G.H.S.A. The record is at best ambiguous as to whether G.H.S.A. obtained
any interest in the land through its condemnation proceeding against Mary or the
only interest G.H.S.A. obtained from Mary was through the deed. The precise
nature of the interest conveyed by the deed is at the heart of this suit, and we
therefore include the text here in its entirety:
State of Texas County of Harris: Know all men by these presents:
That Mary E. Lawrence, administratrix of the estate of John
Lawrence, deceased, of the County of Harris and State of Texas, for
and in consideration of the enhanced value to be given, and which is
contemplated to arise in my lands and other property by the location
and speedy construction of the Galveston, Harrisburg & San Antonio
Railway and for the further consideration of Four Hundred and Thirty-
Seven 00/100 Dollars to me in hand paid, the receipt whereof is
hereby acknowledged, have [sic] granted, bargained, sold, released,
and by these presents to [sic] give, grant, bargain, sell and release to
the Galveston, Harrisburg and San Antonio Railway Company, the
following described tract or parcel of land, situating, lying and being
3
in the County of Harris and State of Texas, containing three & one-
half acres, and more particularly described and known as follows, viz:
A strip of land, fifty feet in width by __ [sic] feet in length of lot No.
Six of the Hollingsworth survey of the John Austin grant near the
western suburbs of the City of Houston and between Buffalo Bayou
and the lines of the Houston & Texas Central Railroad—Being the
land condemned by the Commission to the use of said Railway
Company for Right of Way in Case No. 706, on docket of the County
Court, Harris County, a plat of said tracts is made part hereof, but I
hereby reserve herein the right to all the timber upon the tract given
for right of way together with all and singular the improvements,
rights, hereditaments, and appurtenances to the same belonging or in
any-way [sic] incident or appertaining: To have and to hold, the said
land and appurtenances upon the said Galveston, Harrisburg & San
Antonio Railway Company and its legal representatives forever; and I
bind myself heirs and legal representatives to warrant and forever
defend, all and singular, the title to the aforesaid premises unto the
said Galveston, Harrisburg & San Antonio Railway Company, their
successors and assigns, against every person whomsoever lawfully
claiming or to claim the same or any part thereof, subject, however, to
the following condition, to wit: that if the Galveston, Harrisburg &
San Antonio Railway Company shall, on or before the first day of
January 1881, build its railway and run its cars to the Texas & New
Orleans RR Depot, then only in that case this Deed of Conveyance is
absolute, and to be and remain full [sic] force and effect; but
otherwise to be null and void without further act or reconveyance.
IN TESTIMONY WHEREOF, have hereunto set hand and seal, using
scroll for seal, this 15 day of December, A.D., 1879. 1
1
Because of the age of this handwritten document, the copies in the record are of
extremely poor quality. The parties, however, stipulated to a transcription of the
deed in the trial court. Stipulations conclusively resolve the facts stipulated and all
matters necessarily included therein and bind the court. See Left Gate Prop.
Holdings, Inc. v. Scott, No. 01–10–00334–CV, 2011 WL 1326237, at *8, *10
(Tex. App.—Houston [1st Dist.] Apr. 7, 2011, pet. denied) (mem. op.); see also
Gleason Design Grp. v. Merit Inv. Partners, L.P., No. 05–96–00157–CV, 1997
WL 438771, at *2 (Tex. App.—Dallas Aug. 6, 1997, no writ); Morgan v. Ebby
4
The dispute did not end there, however. M.E. Blakeney, as guardian for two
minor children of John Lawrence, sued G.H.S.A. in 1888, seeking to recover the
strip of land on behalf of the children. Blakeney, 11 S.W. at 174. The trial court
entered judgment for the children, awarding them $360, and simultaneously
condemned a right of way in John Lawrence’s interest in the land for G.H.S.A, “to
be enjoyed by [the railway] as long as it keeps its said track thereon.” Blakeney
appealed to the Supreme Court of Texas, which reversed, holding that the minor
children had benefitted from the $437 that G.H.S.A. had paid Mary in exchange for
her deed and were not entitled to a further recovery. Id. at 174–75.
Through various transactions, Union Pacific and Ameriton succeeded to the
various interests held by their respective predecessors in title. Although there were
once tracks on the property, Union Pacific has removed them and no longer uses
the property for railroad purposes. According to Ameriton, however, it recently
learned that Union Pacific claims a fee simple interest in the property, prompting it
to bring this suit.
The parties stipulated to various facts before submitting their summary
judgment motions, including several documents—a plat, the judgment from the
condemnation suit involving the interest held by Hart and S.E. Lawrence, the trial
court’s opinion in Blakeney, and the Supreme Court’s opinion in Blakeney—which
Halliday Real Estate, Inc., 873 S.W.2d 385, 390 (Tex. App—Fort Worth 1993, no
writ). Accordingly, we use the parties’ stipulated text.
5
referred to the same piece of property that is at issue here. They also stipulated
that Ameriton “owns the Property, subject to whatever rights or interests were
conveyed in the deed,” that Union Pacific is successor in title to G.H.S.A., and that
Union Pacific has removed its tracks from the property and no longer uses it for
railroad purposes. After the trial court granted Ameriton summary judgment on
the ownership issue, the parties also stipulated to the amount of Ameriton’s
reasonable and necessary attorney’s fees, although they continued to dispute
whether such fees were recoverable.
Ameriton sought summary judgment on three grounds: (1) the deed
conveyed only a right of way, not a fee interest in the property; (2) Union Pacific’s
claim to the land is barred by the doctrine of res judicata (claim preclusion); and
(3) that claim is barred by the doctrine of collateral estoppel (issue preclusion).
The parties agree that the sole issue presented to the trial court was the nature of
the interest conveyed by the 1879 deed from Mary to G.H.S.A.
On appeal, Union Pacific raises six arguments. First, it argues that it should
not have to challenge and negate each theory in Ameriton’s motion for summary
judgment because the trial court specified its reasoning. Second, it argues that the
trial court erred in ruling that the 1879 deed to G.H.S.A. conveyed a right of way
and not a fee title. The third and fourth arguments address whether Ameriton was
entitled to summary judgment by application of res judicata and collateral estoppel,
6
respectively, to the Blakeney opinion. Fifth, Union Pacific argues that this Court
should reverse the trial court’s judgment and render judgment for Union Pacific.
Finally, Union Pacific argues that the trial court’s award of attorney’s fees was
improper because Ameriton’s action was really an action to quiet title, not a
declaratory judgment action.
Standard of Review
This court reviews an order granting or denying a motion for summary
judgment de novo. Tex. Mun. Power Agency v. Pub. Util. Comm’n of Tex., 253
S.W.3d 184, 192 (Tex. 2008). “If both parties file competing motions for
summary judgment and one is granted and the other overruled, on appeal this
Court will determine all questions presented, including the propriety of the order
overruling the losing party’s motion.” Jones v. City of Houston, 907 S.W.2d 871,
875 (Tex. App.—Houston [1st Dist.] 1995, writ denied) (citing Int’l Ass’n of Fire
Fighters v. Baytown, 837 S.W.2d 783, 786 (Tex. App.—Houston [1st Dist.] 1992,
writ denied)). “The Court is authorized to either affirm the judgment that the trial
court rendered or reverse the judgment and render the judgment that the trial court
should have rendered.” Id. (citing Int’l Ass’n of Fire Fighters, 837 S.W.2d at 786;
TEX. R. APP. P. 80(b)).
If a written instrument, such as a deed, is worded in such a way that it can be
given a definite or certain legal meaning, the contract may be construed as a matter
7
of law. Coker v. Coker, 650 S.W.2d 391, 393 (Tex. 1983). “An unambiguous
contract will be enforced as written, and parol evidence will not be received for the
purpose of creating an ambiguity or to give the contract a meaning different from
that which its language imports.” David J. Sacks, P.C. v. Haden, 266 S.W.3d 447,
450 (Tex. 2008) (citation omitted); see also Nat’l Union Fire Ins. Co. v. CBI
Indus., Inc., 907 S.W.2d 517, 520 (Tex. 1995) (per curiam). “We must assume the
parties to the instrument intended every clause to have some effect; therefore, the
language of the deed should be interpreted so that no provision is rendered
meaningless.” Hausser v. Cuellar, 345 S.W.3d 462, 466 (Tex. App.—San Antonio
2011, pet. denied); see also Luckel v. White, 819 S.W.2d 459, 461 (Tex. 1991);
Coker, 650 S.W.2d at 393. “A deed will be construed to confer upon the grantee
the greatest estate that the terms of the instrument will permit.” Waters v. Ellis,
312 S.W.2d 231, 234 (Tex. 1958); see also Chambers v. Huggins, 709 S.W.2d 219,
222 (Tex. App.—Houston [14th Dist.] 1986, no writ).
Whether a contract is ambiguous is a question of law, which we review de
novo. Coker, 650 S.W.2d at 394. When a contract contains an ambiguity,
summary judgment is precluded because interpretation of the contract becomes a
fact issue. Id. (citing Harris v. Rowe, 593 S.W.2d 303, 306 (Tex. 1980)).
A simple lack of clarity or disagreement between parties does not render a
term ambiguous. See DeWitt Cnty. Elec. Coop., Inc. v. Parks, 1 S.W.3d 96, 100
8
(Tex. 1999). Rather, “[a]n ambiguity arises only after the application of
established rules of construction leaves an agreement susceptible to more than one
meaning.” Id. “[F]or an ambiguity to exist, both potential meanings must be
reasonable.” Id. “Whether a contract is ambiguous is a question of law for the
court to decide by looking at the contract as a whole in light of the circumstances
present when the contract was entered.” Coker, 650 S.W.2d at 394. If the contract
is ambiguous as a matter of law, only then is parol evidence of the parties’
interpretation of the contract admissible. Pitts & Collard, L.L.P. v. Schecter, 369
S.W.3d 301, 313 (Tex. App.—Houston [1st Dist.] 2011, no pet.).
Whether Union Pacific Must Attack All Grounds in Ameriton’s Motion for
Summary Judgment
A party seeking reversal of a summary judgment must attack every basis
upon which the summary judgment could have been granted. E.g., Goldman v.
Olmstead, 414 S.W.3d 346, 359 (Tex. App.—Dallas 2013, pet. denied); Trevino &
Assocs. Mech., L.P. v. Frost Nat’l Bank, 400 S.W.3d 139, 144 (Tex. App.—Dallas
2013, no pet.). “When a trial court’s order granting summary judgment does not
specify the grounds relied upon, the reviewing court must affirm summary
judgment if any of the summary judgment grounds are meritorious.” FM Props.
Operating Co. v. City of Austin, 22 S.W.3d 868, 872–73 (Tex. 2000) (citing Star-
Telegram, Inc. v. Doe, 915 S.W.2d 471, 473 (Tex. 1995)).
9
Union Pacific first argues that the trial court’s order granting Ameriton’s
motion for summary judgment as to the ownership of the property stated only one
ground for the decision: that the deed conveyed only a right of way interest.
Therefore, Union Pacific argues that it should not have to attack any other grounds
put forward in Ameriton’s motion for summary judgment.
As a threshold matter, we note that the trial court’s order was not explicit as
to the basis for its decision. While the order states that “the deed . . . conveyed a
right-of-way to the Galveston, Harrisburg & San Antonio Railway Company,
predecessor-in-title of Union Pacific Railroad Company,” it does not explain in
what sense the term “right-of-way” is meant. As the Supreme Court of Texas has
explained, “The term ‘right of way’ has a two-fold signification.” Tex. Elec. Ry.
Co. v. Neale, 252 S.W.2d 451, 454 (Tex. 1952). “It sometimes is used to describe
a right belonging to a party, a right of passage over any tract; and it is also used to
describe that strip of land which railroad companies take upon which to construct
their road-bed.” Id. That is, “[r]ight-of-way, when used alone, can have more than
one meaning: it may denote either a right of passage or the right-of-way strip of
land itself.” Lakeside Launches, Inc. v. Austin Yacht Club, Inc., 750 S.W.2d 868,
871 (Tex. App.—Austin 1988, writ denied); see also City of Seabrook v. Port of
Hous. Auth., 199 S.W.3d 403, 433 n.20 (Tex. App.—Houston [1st Dist.] 2006, pet.
dism’d). Accordingly, use of the term “right of way” in a deed or other document
10
does not necessarily define or limit the estate conveyed. Neale, 252 S.W.2d at 454.
The trial court did not connect its finding that “the deed . . . conveyed a right-of-
way” to its later finding that “the property . . . is owned by Ameriton free and clear
of any and all claims of Union Pacific.” Thus, it is not clear that the trial court
specified the grounds for its order.
But whether or not the trial court based its order on Ameriton’s motion for
summary judgment entirely on the deed, we review the cross-motions for summary
judgment and all supporting evidence and determine all questions presented.
Jones, 907 S.W.2d at 875. Union Pacific must therefore attack all grounds upon
which the motion could have been granted and, indeed, has actually done so. See
FM Props. Operating Co., 22 S.W.3d at 872–73; Goldman, 414 S.W.3d at 359;
Trevino & Assocs. Mech., 400 S.W.3d at 144. Accordingly, we overrule Union
Pacific’s first issue as moot.
Application of the Doctrine of Res Judicata
To determine the effect of the deed, we first consider whether the doctrine of
res judicata bars Union Pacific’s claims to the property. Union Pacific argues in its
third issue that it does not, as the Blakeney Court did not determine the nature of
the interest conveyed by the deed. Ameriton responds that Blakeney is dispositive
of the interest conveyed by the 1879 deed, thus barring Union Pacific’s claims and
mandating judgment for Ameriton.
11
The doctrine of res judicata, often referred to as claim preclusion, “prevents
the relitigation of a claim or cause of action that has been finally adjudicated, as
well as related matters that, with the use of diligence, should have been litigated in
the prior suit.” Barr v. Resolution Trust Corp., 837 S.W.2d 627, 628 (Tex. 1992).
The doctrine
requires proof of the following elements: (1) a prior final judgment on
the merits by a court of competent jurisdiction; (2) identity of parties
or those in privity with them; and (3) a second action based on the
same claims as were raised or could have been raised in the first
action.
Amstadt v. U.S. Brass Corp., 919 S.W.2d 644, 652 (Tex. 1996).
There is no question that the first element is satisfied, in that Blakeney
represents a final adjudication on the merits of the claims by John Lawrence’s
minor children, through their guardian, against G.H.S.A. Blakeney, 11 S.W. at
174. The parties have stipulated that the second element is satisfied, as each party
is in privity with parties bound by Blakeney. The only question we must answer is
whether the third element is satisfied: that is, whether this suit raises claims that
were or could have been raised in Blakeney.
Blakeney did not address the nature of the interest conveyed by the 1879
deed. The only issue was whether, given that the children were not parties to the
condemnation proceeding against Mary, “the [trial] court erred in giving judgment
for plaintiffs without requiring them to refund to [G.H.S.A.] the money paid by
12
it . . . .” Id. at 174. Although the suit was an action to try title, the opinion never
mentions the deed and never uses the words “fee” or “easement.” Id. It uses “right
of way” several times, but only once clarifies whether it is using “right of way” in
the sense of a right of passage or in the sense of a strip of land. Id. at 174–75; see
also Neale, 252 S.W.2d at 454; City of Seabrook, 199 S.W.3d at 433 n.20;
Lakeside Launches, 750 S.W.2d at 871. In that one context, the Court merely
noted that the trial court “condemned a right of way in the land to the use of the
company.” Blakeney, 11 S.W. at 174. But the Court then reversed that judgment
on equitable grounds and rendered judgment for G.H.S.A., holding, “It would be
against the manifest justice and equity of the case to permit [the children] to
recover the land without refunding the money of which they have had the benefit.”
Id. at 175.
Ameriton argues that Blakeney nonetheless is “unmistakably clear that the
deed conveyed a ‘right of way’ and that such conveyance was made in accordance
with a condemnation decree.” Because a railroad cannot acquire fee simple title
via condemnation, Ameriton argues that Blakeney rests on a holding that only a
right of way, not fee simple title, was conveyed by the deed. See TEX. TRANSP.
CODE ANN. § 112.055 (West 2011) (“A right-of-way that a railway company in
this state acquires by condemnation does not include a fee simple estate in public
or private land.”), added by Act of May 11, 2009, 81st Leg., R.S., ch. 85, § 2.03,
13
sec. 112.005, 2009 Tex. Gen. Laws 153, 161; see also Act of May 11, 2009, 81st
Leg., R.S., ch. 85, § 5.01(a), 2009 Tex. Gen. Laws 153, 205 (repealing TEX. REV.
CIV. STAT. ANN. art. 6339 (predecessor to TEX. TRANSP. CODE ANN. § 112.055 that
was in effect at time of 1879 deed)); Brightwell v. Int’l-Great N.R.R. Co., 49
S.W.2d 437, 438 (Tex. 1932) (“It is the settled law of this state that a railroad,
when it secures its right of way by condemnation proceedings, acquires a mere
easement, but it may secure and hold a fee-simple estate in the land across which it
constructs its road.”).2
Contrary to Ameriton’s position, Blakeney never mentions the deed directly.
Further, Blakeney does not hold that the deed conveyed only what the railroad
could have obtained via condemnation. 3 Rather, the Blakeney Court described as
“beyond controversy” G.H.S.A.’s allegations
that, pending the appeal, a compromise was agreed upon between the
parties; that in pursuance of such compromise defendant paid the
administratrix the sum of $437, which she received in full satisfaction
for the land; that she subsequently reported her action to the county
court; that her report was confirmed; . . . that the money so received
was appropriated by her in discharge of liens then subsisting upon
other real estate of her intestate, which the plaintiffs inherited from
their father. . . . that a decree was entered in the county court in the
condemnation proceedings confirming the title of defendant to the
2
As support for its position, Ameriton cites Thompson v. Janes, 251 S.W.2d 953
(Tex. 1952), but Thompson merely states the rule that a railroad may only take a
right of way easement via condemnation; it is silent regarding deeds issued in
settlement of condemnation proceedings. 251 S.W.2d at 955.
3
Nor does the deed itself indicate that it was made in accordance with a
condemnation decree or other court order.
14
right of way, and that the administratrix made a conveyance of the
right of way in accordance with that decree.
11 S.W. at 174 (emphasis added). Blakeney does not hold that the decree in
question was a decree condemning a right of way. Rather, the decree merely
“confirm[ed] the title of defendant to the right of way,” and Mary’s conveyance
was “in accordance with that decree.” Id. Blakeney is silent on both the extent of
the title conveyed by Mary and the sense in which “right of way” is meant. Rather,
the holding of Blakeney is merely that John Lawrence’s children were not entitled
to recover G.H.S.A.’s interest under that title without first refunding the money
received by Mary and used for the children’s benefit. Id. at 175.
Ameriton argues that, even if Blakeney did not explicitly determine the
nature of the interest held by G.H.S.A., it did so by implication. Thus, it asserts,
G.H.S.A. should have challenged the Supreme Court’s description of G.H.S.A.’s
interest as a right of way and argued that it held a fee title. But G.H.S.A. was not
required to do so in order to challenge the lower court’s award of damages on the
grounds that the children were improperly omitted as parties in the condemnation
proceeding. More importantly, the Supreme Court did not have to decide that
question. Rather, the issue resolved by Blakeney was whether G.H.S.A. could
maintain title at all against an attack by John Lawrence’s children, not the nature of
that title. Id. at 175.
15
Ameriton draws a parallel between this case and a case involving another
century-old grant of land to a railroad, Marvin M. Brandt Revocable Trust v.
United States, 134 S. Ct. 1257 (2014). In that case, the United States patented land
to Marvin Brandt’s parents in 1976, subject to an existing right-of-way for a
railroad created under the federal General Railroad Right-of-Way Act of 1875.
134 S. Ct. at 1262; see also General Railroad Right-of-Way Act of 1875, ch. 152,
18 Stat. 482 (codified at 43 U.S.C. §§ 934–39), repealed by Federal Land Policy
and Management Act of 1976, Pub. L. No. 94–579, 90 Stat. 2743. The question
before the Court was “what happens to a railroad’s right of way granted under a
particular statute—the [1875 Act]—when the railroad abandons it: does it go to the
Government, or to the private party who acquired the land underlying the right of
way?” 134 S. Ct. at 1260.
At the government’s urging, the Court had previously held that a right under
the 1875 Act conveyed a simple easement, in Great Northern Railway Co. v.
United States, 315 U.S. 262, 62 S. Ct. 529 (1942). Thus, in Marvin M. Brandt
Revocable Trust, the Court rejected the government’s argument that the right of
way conveyed under the Act “is tantamount to a limited fee with an implied
reversionary interest.” 134 S. Ct. at 1268. The Court explained, “We decline to
endorse such a stark change in position, especially given ‘the special need for
certainty and predictability where land titles are concerned.’” Id. (citation
16
omitted). As the Court explained, the government lost in Marvin M. Brandt
Revocable Trust “in large part because it won when it argued the opposite before
this Court more than 70 years ago.” Id. at 1264.
According to Ameriton, Marvin M. Brandt Revocable Trust is relevant
because G.H.S.A. took the position in Blakeney that it was entitled to a mere
easement, not a fee interest. Thus, Ameriton argues that we should follow the
Supreme Court’s logic and reject Union Pacific’s claim to the land. We disagree.
While the Marvin M. Brandt Revocable Trust Court was able to quote the
government’s earlier brief in Great Northern Railway, the record here does not
contain the parties’ pleadings in Blakeney, nor is the Blakeney opinion clear as to
the arguments made by the parties to that case. See id. Moreover, the Marvin M.
Brandt Revocable Trust decision “turn[ed] on what kind of interest Congress
granted to railroads in their rights of way in 1875,” a question that both is
irrelevant here and had already been explicitly addressed in Great Northern
Railway. Id. at 1268. Blakeney, by contrast, made no explicit findings about the
nature of the interest conveyed by the 1879 deed.
We hold that Blakeney is not a final adjudication of the nature of the rights
conveyed to G.H.S.A. and that issue was neither raised nor required to be raised in
that case. Accordingly, we sustain Union Pacific’s third issue.
17
Application of the Doctrine of Collateral Estoppel
We next turn to the doctrine of collateral estoppel, also known as issue
preclusion, which “prevents relitigation of particular issues already resolved in a
prior suit.” Barr, 837 S.W.2d at 628.
A party seeking to assert the bar of collateral estoppel must establish
that (1) the facts sought to be litigated in the second action were fully
and fairly litigated in the first action; (2) those facts were essential to
the judgment in the first action; and (3) the parties were cast as
adversaries in the first action.
Sysco Food Servs., Inc. v. Trapnell, 890 S.W.2d 796, 801 (Tex. 1994). Ameriton
argues that the doctrine applies to Blakeney to bar Union Pacific’s claims, while
Union Pacific argues that it does not.
We have already noted that Blakeney does not discuss the nature of the
interest conveyed by the 1897 deed, but focused on whether that interest could
survive attack by John Lawrence’s children. Collateral estoppel applies only if
“the facts sought to be litigated in the second action were fully and fairly litigated
in the first action.” Id. Further, “collateral estoppel requires that the issue decided
in the first action be identical to the issue in the pending action.” Mann v. Old
Republic Nat’l Title Ins. Co., 975 S.W.2d 347, 350 (Tex. App.—Houston [14th
Dist.] 1998, no pet.) (citing Getty Oil Co. v. Ins. Co. of N. Am., 845 S.W.2d 794,
802 (Tex. 1992)).
18
We hold that the nature of the interest conveyed by the 1897 deed was not
fully and fairly litigated in Blakeney. 4 Accordingly, we hold that collateral
estoppel does not bar Union Pacific’s claims and sustain Union Pacific’s fourth
issue.
The Interest Conveyed by the Deed
Because Blakeney does not bar Union Pacific’s claims, we must determine
the nature of the interest conveyed by the 1879 deed. “The construction of an
unambiguous deed is a question of law for the court.” Luckel, 819 S.W.2d at 461
(citing Altman v. Blake, 712 S.W.2d 117, 118 (Tex. 1986)). “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.” Id. (citing Garrett v. Dils Co., 299 S.W.2d 904, 906 (Tex.
1957)). We therefore look to the terms of the deed itself, seeking to harmonize all
parts of it. Id. In Texas, “[a]n estate in land that is conveyed or devised is a fee
simple unless the estate is limited by express words or unless a lesser estate is
conveyed or devised by construction or operation of law.” TEX. PROP. CODE ANN.
§ 5.001 (West 2004).
4
To the extent that Blakeney characterized that interest as a “right of way,” such
characterization did not clearly identify the interest as a right of passage or as
ownership of the land itself. Neale, 252 S.W.2d at 454; City of Seabrook, 199
S.W.3d at 433 n.20; Lakeside Launches, 750 S.W.2d at 871. Moreover, any such
characterization was not “essential to the judgment” and thus cannot collaterally
estop Union Pacific. See Sysco Food Servs., 890 S.W.2d at 801.
19
The deed states that Mary has “granted, bargained, sold, released, and by
these presents [does] give, grant, bargain, sell and release to [G.H.S.A.] the
following described tract or parcel of land,” which is then described. The
description includes the clarification, “Being the land condemned by the
Commission to the use of said Railway Company for Right of Way in Case No.
706.” It also reserves to Mary “the right to all timber upon the tract given for right
of way together with all and singular the improvements, rights, hereditaments, and
appurtenances to the same belonging or in any-way [sic] incident or appertaining.”
According to Ameriton, the use of the term “right of way” in these clauses
indicates that the deed conveyed only a right of way across the land, not a fee
interest in the land itself.
Ameriton argues that the deed contains no indication that it conveyed any
interest other than what was condemned, that is, a right to use the land. On the
contrary, the deed’s only reference to the condemnation was in the context of
describing the location of the land to be conveyed. That is, it merely states that the
deed conveys the same land that was at issue in the condemnation proceeding, a
statement that we do not find particularly remarkable given that Mary executed the
deed to settle a legal dispute. The deed contains no indication that the interest
conveyed was limited to the interest that the railroad could have obtained through
the condemnation proceeding.
20
Ameriton also argues that the interest conveyed by the deed was necessarily
limited to that which the railroad could have obtained by condemnation, citing Red
River, Texas & Southern Railway Co. v. Davis, 195 S.W. 1160 (Tex. App.—Dallas
1917, writ ref’d). In that case, the owner in fee simple of the land in controversy
“executed a conveyance in form of a warranty deed” to the railroad, on the express
condition that the land could be used for “railroad purposes only.” 195 S.W. at
1161. Critically, however, the owner and the railroad had previously agreed that
the owner “would only deed such interest in said land as the railway company
could procure by the condemnation proceedings, . . . [and] the railway company
[knew] at the time [of the deed] that [the owner] only intended to part with an
easement for railroad purposes exclusively.” Id. at 1161–62. There is no evidence
of such an agreement between G.H.S.A. and Mary. Moreover, the issue decided in
Red River was not whether the interest conveyed was an easement or a fee, but
whether the deed contained a condition subsequent resulting in forfeiture of the
right of way due to the railroad’s failure to use it for railroad purposes. Id. at 1162.
Therefore, we reject Ameriton’s interpretation of Red River.
Next, Ameriton argues that the 1879 deed’s reference to the property as
“given for right of way” in the clause reserving Mary’s timber rights, viewed in
combination with the grantor’s intent to enhance the value of surrounding property
and the deed’s settlement of a condemnation attempt, supports Ameriton’s
21
position. Ameriton does not cite any authorities as support for this proposition.
See TEX. R. APP. P. 38.1(i). We note that one of the deeds construed in Stevens v.
Galveston, Harrisburg & San Antonio Railway Co., 212 S.W. 639 (Tex. Comm’n
App. 1919, judgm’t adopted), contained similar language, conveying “the right of
way for said company’s railway.” 212 S.W. at 640. At face value, this conveyed
“the right of way” only, not a fee interest, yet the Commission of Appeals
construed this deed as granting G.H.S.A. “an indefeasible fee-simple title to the
property.” Id. at 645. The precise language before us is contained in a reservation
of rights, not a granting or habendum clause, and states, at most, a reason or
purpose for the grant, not a limitation on the interest conveyed. Id. We therefore
decline to read the phrase “given for right of way” in the clause reserving Mary’s
timber rights as prevailing over all other language in the deed purporting to convey
“the following described tract or parcel of land.”
Ameriton also argues that Mary accepted the condemnation award for a right
of way across the property, rather than money paid as a purchase price, confirming
that she conveyed only what the railroad could obtain through condemnation, that
is, a right of way. Ameriton does not cite any evidence supporting this claim in the
record. On the contrary, both the deed and the Blakeney opinion confirm that
G.H.S.A. paid Mary $437 for whatever rights it obtained under the deed. See
Blakeney, 11 S.W. at 174. The record does not reflect that this was the amount of
22
the condemnation award as to the interest held in the land by John Lawrence’s
estate. Moreover, any such evidence would be parol evidence, which we can only
consider if the deed is ambiguous. See, e.g., David J. Sacks, P.C., 266 S.W.3d at
450–51; Nat’l Union Fire Ins. Co., 907 S.W.2d at 520. Although we must decide
as a question of law whether the deed is ambiguous, we note that neither party
contends that it is. See Coker, 650 S.W.2d at 394.
On its face and “unless the estate is limited by express words or unless a
lesser estate is conveyed or devised by construction or operation of law,” the deed
conveys a fee estate. TEX. PROP. CODE ANN. § 5.001. While it does not explicitly
state that it conveys a fee title, it also lacks “express words” clearly indicating an
intent to convey a lesser estate. Instead, it purports to convey a “tract or parcel of
land.” It describes the grant in terms of the land itself, not in terms of G.H.S.A.’s
rights over the land. It conveys “the said land and appurtenances.” Mary
promised, on behalf of herself, her heirs, and her legal representatives, to defend
G.H.S.A.’s “title to the aforesaid premises,” not merely a right of use.
Further, Mary reserved to herself timber rights in the land conveyed. If
G.H.S.A. obtained a mere easement, it would have had no right to do anything to
the timber on the land, except as reasonably necessary for the full enjoyment of the
easement, unless such rights were expressly granted in the deed. See, e.g., Knox v.
Pioneer Natural Gas Co., 321 S.W.2d 596, 601 (Tex. Civ. App.—El Paso 1959,
23
writ ref’d n.r.e.); San Jacinto Sand Co. v. Sw. Bell Tel. Co., 426 S.W.2d 338, 344–
45 (Tex. Civ. App.—Houston [14th Dist.] 1968, writ ref’d n.r.e.). The deed’s
reservation of timber rights was thus unnecessary if the deed conveyed only an
easement or right of way. We must assume the parties did not intend any provision
of the deed to be meaningless. Luckel, 819 S.W.2d at 461; Coker, 650 S.W.2d at
393; Hausser, 345 S.W.3d at 466. The reservation of timber rights implies that the
deed conveyed an estate that would, but for the reservation, have included those
rights. That is, the reservation implies that the deed conveyed a fee estate.
Ameriton also argues that the estate conveyed by the deed is limited by
express words in that the consideration given included “the enhanced value to be
given, and which is contemplated to arise in [Mary’s] lands and other property by
the location and speedy construction of the [G.H.S.A] Railway.” According to
Ameriton, Texas courts have long treated instruments in which the enhanced value
of surrounding land forms part of the consideration as merely granting an
easement.5 As support, Ameriton relies on Stevens.
In Stevens, the Commission of Appeals identified three classes of cases
construing deeds and contracts for deeds to railway companies. 212 S.W. at 641–
5
We are not aware of any policy supporting such a rule. A property owner may
desire, for example, to benefit from the additional customers a railroad may soon
bring to her property and, accordingly, negotiate a settlement to resolve a
condemnation proceeding quickly. This does not imply that the owner cannot
convey a fee. Further, as discussed below, the law does not support such a rule.
24
43. The first class consisted of cases holding that “where the deed in the granting
clause conveys a right of way only, the estate conveyed will be held to be an
easement, and not a fee, although apt words to convey the fee are employed.” Id.
at 641–42 (citing Right of Way Oil Co. v. Gladys City Oil Co., 157 S.W. 737 (Tex.
1913)). That is, courts faced with such deeds look to the granting clause of the
deed first and, if that clause conveys only an easement, the deed as a whole
conveys only an easement, even if other clauses might be read to convey a fee. Id.
By contrast, “if the granting clause conveys a fee title to the property, subsequent
recitals, which merely limit the use to which the same may be put, do not restrict
the conveyance to an easement.” Stanbery v. Wallace, 45 S.W.2d 198, 199 (Tex.
Comm’n App. 1932, holding approved); see also Veltmann v. Damon, 701 S.W.2d
247, 247–48 (Tex. 1985) (“It is well-settled that when there is an irreconcilable
conflict between clauses of a deed, the granting clause prevails over all other
provisions.”).
The first class of cases identified in Stevens included only one Texas case:
Right of Way Oil Co. v. Gladys City Oil Co., 157 S.W. 737 (Tex. 1913). That case
involved a deed reading, “have and do hereby grant, sell and convey . . . for the
purpose of constructing, operating and maintaining its railroad, the right of way,
two hundred feet in width, over and upon the above-described tract of land.” 157
S.W. at 738. This clause is totally unlike Mary’s grant of “the following described
25
tract or parcel of land.” Thus, Right of Way Oil does not support Ameriton’s
arguments. The other cases in this first class of cases cited by Stevens are similarly
distinguishable. 6
The second class of cases identified in Stevens comprised “those in which
the grantee claims under a contract for a conveyance of lands for right of way or
other railway purposes, with a covenant to convey the fee-simple title.” Stevens,
212 S.W. at 642 (citing Uhl v. Oh. River R. Co., 41 S.E. 340, 341 (W. Va. 1902);
Lockwood v. Oh. River R. Co., 103 F. 243, 243–44 (4th Cir. 1900); Hill v. W. Vt.
R.R. Co., 32 Vt. 68, 69 (1859)). The cases in this class all involved agreements
6
See Jones v. Van Bochove, 61 N.W. 342, 343 (Mich. 1894) (deed conveyed
easement where granting clause gave “[a]ll that certain piece or parcel of land . . .
described as follows, to wit: The right of way for a railroad”); Cincinnati, I., St. L.
& C. Ry. Co. v. Geisel, 21 N.E. 470, 470 (Ind. 1889) (same result where granting
clause gave “the right of way for so much of said railroad, being eighty feet wide,
as may pass through the following described piece, parcel, or lot of land”);
Indianapolis & V.R. Co. v. Reynolds, 19 N.E. 141, 141 (Ind. 1888) (deed conveyed
easement where granting clause gave “the right of way for so much of said
railroad as may pass through the following described piece, parcel, or lot of land,”
but required parol evidence as to width of easement); Cleveland, C., C. & I.R. Co.
v. Coburn, 91 Ind. 557, 560, 562 (Ind. 1883) (deed conveyed, at most, estate upon
condition subsequent where granting clause gave “the right of way for so much of
said railroad as may pass through the following described piece, parcel, or lot of
land”); Blakely v. Chi., K. & N.R. Co., 64 N.W. 972, 973 (Neb. 1895) (deed
conveyed easement where granting clause gave strip of land “for right of way, and
for operating [grantee’s] railroad only”); Reichenbach v. Wash. Short-Line Ry.
Co., 38 P. 1126, 1126 (Wash. 1894) (same result where granting clause gave only
“the right and privilege of surveying and laying out . . . through, over, across, and
along the land . . . the route and site of [a] railroad” and only “so long as the same
shall be used for the operation of a railroad”). Ameriton also cites a later case that
fits into this class, Rio Bravo Oil Co. v. Hunt Petroleum Corp., 455 S.W.2d 722
(Tex. 1970). Rio Bravo Oil is similarly distinguishable. Id. at 723, 726 (holding
that deed conveyed only easement where granting clause conveyed “a right of way
for the [railroad], over and across the following described tract of land”).
26
under which one party would convey land to another at some future date, with a
further limitation as to the use of that land. 7 Such cases have no relevance to
Ameriton’s claims; the 1879 deed is not a covenant to convey an interest in the
property, but an actual conveyance.
The third class of cases identified in Stevens consisted of cases from other
states in which a railroad sought to acquire a strip of land cutting through a larger
estate, and the courts held that the deeds conveyed only easements. Id. But the
Stevens court rejected the holdings of these cases, holding that Texas law does not
limit railways to acquiring only easements in real property. Id. (citing Calcasieu
Lumber Co. v. Harris, 13 S.W. 453 (Tex. 1890)). Rather, in Texas, “a railway
company may condemn property, not only for right of way purposes, but for other
necessary uses,” and may also acquire fee title “as absolute as that of a private
individual, at least [insofar] as concerns immunity from attack by [anyone] except
the state.” Id. This third class of cases thus does not control our decision.
Ameriton nonetheless asks us to interpret Stevens as holding that, when a
deed is signed during a condemnation proceeding and the seller hopes to benefit
from the presence of a railway, the deed conveys only a right of way. Stevens,
7
See Uhl, 41 S.E. at 340 (deed conveying easement and containing promise “to
execute and acknowledge in due form of law, when required by said company, a
deed conveying to said company in fee simple the land hereinbefore described”);
Lockwood, 103 F. at 244 (same); Hill, 32 Vt. at 69 (agreement that grantor would,
“on reasonable request, convey . . . such lands . . . as should be required for [the]
railroad”).
27
however, contains no such holding. Rather, the Court merely discussed the
categories of cases just described and distinguished them as irrelevant to the
particular factual background of Stevens. 212 S.W. at 643.
The Stevens Court noted that a court seeking to determine the character of
the estate granted by a deed will look both at the uses for the property designated
in the conveyance and the relation of the grantor to those uses. Id. That is, the
court asks whether the grantor obtains some special benefit, particular to herself
and not potential assignees, from the conveyance. Id. But the Court went on to
hold that it could only give the deeds before it “a meaning not fairly deducible
from the language employed by the parties [if] the circumstances [were] such, in
[the Court’s] opinion, as to impel the conclusion that the parties intended other
than their expressed language would ordinarily imply.” Id. The deed before us is
susceptible to interpretation without reference to external circumstances. We
therefore reject Ameriton’s argument.
We hold that the 1879 deed unambiguously conveyed an undivided, fee
simple interest in the property in question to G.H.S.A. Union Pacific is G.H.S.A.’s
successor in title, and the record does not defeat Union Pacific’s title. We
therefore sustain Union Pacific’s second issue and hold that the trial court
improperly granted summary judgment for Ameriton.
28
Whether the Trial Court Should Have Granted Union Pacific’s Motion for
Summary Judgment
Because the parties filed competing motions for summary judgment, we
must consider the merits of both and render the judgment that the trial court should
have rendered. Jones, 907 S.W.2d at 875. Union Pacific asks that we render
judgment for it, because the 1879 deed conveyed a fee interest to G.H.S.A. and
because Ameriton’s only response to Union Pacific’s motion for partial summary
judgment was to rely on Blakeney. The record does not support this outcome.
In its response to Union Pacific’s motion and in its brief to this Court,
Ameriton argues that the 1879 deed contains a condition that G.H.S.A. was
required to perform for the deed to vest, namely, building a railroad and running
cars on it to the Texas & New Orleans Railroad Depot before January 1, 1881.
Otherwise, the deed would be “null and void without further act of reconveyance.”
But, as Ameriton observed, there is no evidence in the record that G.H.S.A. met
this condition. Rather, the only evidence was that Union Pacific “has removed its
tracks from the Property” and “no longer users the Property for railroad purposes.”
Union Pacific bore the burden to demonstrate that its predecessor in title
built a railroad and ran cars on it to the Texas & New Orleans Railroad Depot
before January 1, 1881. See TEX. R. CIV. P. 166a(c). Because it has not done so, it
has not demonstrated that the fee title conveyed by the deed ever vested.
Therefore, Union Pacific was not entitled to summary judgment. Id.
29
We sustain Union Pacific’s fifth issue in part, in that we hold that Ameriton
was not entitled to summary judgment. We otherwise overrule the issue, as the
trial court properly denied Union Pacific’s motion.
Because Ameriton was not entitled to summary judgment as to ownership of
the property, it has not demonstrated that it is entitled to recover its attorney’s fees.
Id. We therefore overrule Union Pacific’s sixth issue as moot.
Conclusion
We reverse the judgment of the trial court and remand for further
proceedings consistent with this opinion.
Harvey Brown
Justice
Panel consists of Chief Justice Radack and Justices Higley and Brown.
30