Concho Resources, Inc. v. Marsha Ellison D/B/A Ellison Lease Operating

IN THE SUPREME COURT OF TEXAS
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No. 19-0233
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CONCHO RESOURCES, INC., ET AL., PETITIONERS,
v.
MARSHA ELLISON D/B/A ELLISON LEASE OPERATING, RESPONDENT
══════════════════════════════════════════
ON PETITION FOR REVIEW FROM THE
COURT OF APPEALS FOR THE THIRTEENTH DISTRICT OF TEXAS
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Argued January 5, 2021
JUSTICE LEHRMANN delivered the opinion of the Court.
This case is principally a trespass-to-try-title suit between the lessees of adjacent mineral
estates. The plaintiff alleges that the defendants drilled several wells either on the plaintiff’s
leasehold or closer to the lease line than Railroad Commission rules allow. The defendants,
relying on a boundary stipulation between the fee owners of the two mineral estates and the
plaintiff’s written acceptance of the stipulation, claim that the plaintiff ratified the agreed
boundary line, foreclosing the trespass claims. The trial court granted summary judgment for the
defendants, but the court of appeals reversed, holding that the boundary stipulation is void and
thus may not be ratified. We hold that the boundary stipulation is valid and that the defendants
conclusively established their ratification defense. Accordingly, we reverse the court of appeals’
judgment.
I. Background
J.D. Sugg died in 1925, and his family assumed ownership of a 640-acre tract of land in
Irion County known as Section 1. In 1927, the Suggs conveyed a portion of Section 1 to nearby
landowners, the Noelkes, as part of a land swap. The 1927 deed described the conveyed land,
referred to hereafter as the northwest tract, as “All of Survey 1, Block 6, H & T.C. Ry. Co. [i.e.,
Section 1] lands located North and West of the public road which now runs across the corner of
said Survey, containing 147 acres, more or less.” In 1930, the remainder of Section 1, referred to
hereafter as the southeast tract, was conveyed to A.A. Sugg by partition deed, which describes
the land as “Abstract 312, Survey 1, Original Grantee H. & T.C. Ry. Co., Block 6, 493 acres.”
The actual acreage of the portion of Section 1 located north and west of the public road
referenced in the 1927 deed is 301 acres (not 147), and the actual acreage of the portion located
south and east of the public road is 339 acres (not 493).
The northwest tract was conveyed multiple times, and by 1987 the tract’s mineral estate
was owned by the Pilon family trust and three other individuals (collectively, the Pilons). That
year, the Pilons granted oil-and-gas leases to Questa Oil & Gas Co., as lessee, covering the
northwest tract. The leases described the tract as a “147 acre tract of land out of [Section 1],
lying N and W of the public road which runs NE and SW across said [Section], and being same
land conveyed [by the 1927 deed].” Questa drilled a well (the Pilon Well #1) located near the
northwest corner of the tract. In its application for a permit to drill the well, Questa certified that
the Pilon leases covered 320 acres. In 1996, after a series of assignments, the Pilon leases were
assigned to Jamie Ellison d/b/a Ellison Lease Operating, which became the designated operator
of the Pilon Well #1. Ellison’s filings with the Railroad Commission and signs posted on the
2
property similarly described the leases as comprising 320 acres. Around the same time the leases
were assigned to Ellison, William and Carol Richey, as trustees of the Richey Living Trust,
acquired the fee interest in the northwest tract’s mineral estate.
Meanwhile, the southeast tract passed through the estate of A.A. Sugg, 1 and by April
2006 the tract’s mineral estate was owned by several members of the Sugg and Farmar families
(collectively, the Farmars). 2 On April 13, 2006, the Farmars granted an oil and gas lease to
Samson Resources Company 3 covering numerous tracts, including “493 [acres]” in the “South
part of [Section 1].”
In October 2006, Samson obtained a drilling title opinion acknowledging several issues
relating to the southeast tract. The opinion outlined problems with the original 1930 deed, which
described the southeast tract as containing 493 acres but provided no indication of the location of
the acreage. Further, the opinion advised that the 1927 deed described the northwest tract as
being in the form of a triangle (based on the location of the public road), but that the description
of the southeast tract in subsequent deeds “would lead a surveyor to assume that this land is in
the form of a rectangle lying in the South part of Section 1, which would be incorrect.”
1
A 2005 property tax receipt from A.A. Sugg, Jr. described the tract as containing 339 acres.
2
One of the deeds in that chain of title was a gift mineral deed dated April 4, 2006, in which Philip Farmar
conveyed his interest in the mineral estate to his children, Nancy Farmar Warfield, Andrea Farmar Bjeldanes, Peter
D. Farmar, and Steven S. Farmar. The deed described the tract as “All of the South 493.0 acres in Section 1 . . . ,
being a tract of land lying South and East of the public road which runs NE and SW across [Section] 1, containing
493.0 acres, more or less.”
3
Several Samson entities are named as defendants in this suit, including Samson Resources Company,
Samson Lone Star Limited Partnership (which merged with Samson Lone Star LLC), Samson Lone Star LLC
(which changed its name to Samson Exploration LLC), and Samson Exploration LLC. The entities are collectively
referred to herein as Samson.
3
Samson’s surveyor prepared a preliminary survey plat that credited 493 acres to the southeast
tract, including 154 acres of land north of the public road. 4
In December 2006, Samson notified Ellison and the Richeys of its desire to drill a well
(the Sugg Well #1) on Section 1, approximately 100 feet south of the public road.
Notwithstanding the preliminary survey crediting the disputed 154 acres north of the public road
to the southeast tract, Samson requested that Ellison and the Richeys waive any objection to
Samson’s application for a “Rule 37 spacing exception”—that is, an exception to the Railroad
Commission rules’ general prohibition against drilling a well within 467 feet of a lease line. See
28 TEX. ADMIN. CODE § 3.37(a)(1). Ellison and the Richeys agreed to the waiver, and Samson
drilled the Sugg Well #1 in 2007.
In 2008, Samson’s landman, Tim Reece, prepared a Boundary Stipulation of Ownership
of Mineral Interest between the Farmars (owners of the southeast-tract mineral estate) and Carol
Richey (owner of the northwest-tract mineral estate). The stipulation referenced the 1927 and
1930 deeds’ conveyances, describing the Farmars as “the current owners of the minerals under
the 493 acre tract” and Richey as “the current owner of the minerals under the 147 acre tract.”
The stipulation stated that “a question has arisen among the Parties as to the physical location of
the 147 acre tract and the ownership in the mineral estate in [Section 1]” and that the Parties
desired to “declare, stipulate, acknowledge, and establish of record the location of the 147 acre
tract and the 493 acre tract in the mineral estate.” The stipulation went on to declare the
4
In August 2007, A.A. Sugg, Jr. (who owned the southeast tract’s surface estate) executed a warranty deed
conveying to the Richeys the “surface estate only” of the portion of Section 1 “that lies Northwest of County Road
411 [the public road referenced in the 1927 deed], the East boundary being the East survey line of Section 1, the
West boundary being the West boundary line of Survey 1, the North boundary being the South boundary line of the
property owned by [the Richeys], and the South boundary being County Road 411.” The deed further stated that
“the total number of acres shall be considered 154.”
4
boundary of the mineral estate in accordance with the boundary line contained in the Samson
survey. In other words, the parties stipulated that the disputed 154-acre tract was part of the
southeast tract. The parties signed the stipulation in August and September 2008, but it
purported to be “effective, for all purposes, as of July 8, 1987” (the date the Pilon leases were
executed). The stipulation was recorded in the Irion County property records on October 3,
2008.
On October 16, 2008, Reece sent a letter to Ellison Lease Operating enclosing the
stipulation and requesting that Ellison “signify your acceptance of the description of the Richey
147 acre tract as set out in the Stipulation (your leasehold), by signing both copies of this letter in
the space provided below and return one copy to my attention in the enclosed self-addressed
envelope. Upon your acceptance, a more formal and recordable document will be provided.”
The letter noted that Samson “plan[s] to spud the Sugg 1 #3 well . . . in the next 30 days.” Jamie
Ellison countersigned the letter on October 22, and Reece averred that he received it in late
October 2008. The “more formal and recordable document” referenced in the letter was never
provided.
Samson subsequently drilled three more wells, two of which are at issue in this suit along
with Sugg Well #1: Sugg Well #3, which was drilled on the disputed tract north of the public
road; and Sugg Well #4, which is not on the disputed tract but would violate Railroad
Commission spacing requirements if the public road is the boundary. The following map, also
included in the court of appeals’ opinion, provides a helpful visual:
5
In December 2010, Samson assigned its lease to Three Rivers Acquisition, LLC (referred
to, along with affiliated entity Three Rivers Operating Company LLC, as Three Rivers). Three
Rivers recompleted Sugg Wells #1, #3, and #4 in 2011. In 2012, Three Rivers assigned the lease
to COG Operating LLC (referred to, along with affiliated entity Concho Resources, Inc., as
Concho).
Beginning in November 2010, Sunoco Partners Marketing & Terminals LP entered into a
series of arrangements with the successive operators of the Sugg wells pursuant to which it
purchased the oil produced from those wells. Under those arrangements, Sunoco 5 was
responsible for paying the sales proceeds to the respective operator—first Samson, then Three
5
References to Sunoco include both Sunoco Partners Marketing & Terminals LP and its general partner,
Sunoco Logistics Partners Operations GP LLC.
6
Rivers, then Concho—and the operator assumed responsibility for paying the proper portion of
those proceeds to the appropriate interest owners.
Jamie Ellison died in 2011, and his wife Marsha continued to maintain the Pilon leases.
On June 21, 2013, Marsha Ellison d/b/a Ellison Lease Operating (hereafter, Ellison) filed suit
against Samson, Three Rivers, and Concho, 6 alleging that the Pilon leases cover all land in
Section 1 located north and west of County Road 411 and that the 2008 boundary stipulation and
the 2008 letter signed by Jamie Ellison had no impact on Ellison’s legal title under those leases.
Ellison sought a declaratory judgment to that effect and also brought claims for trespass to try
title, trespass to real property, conversion, unlawful drainage, gross negligence, and nonpayment
of oil and gas proceeds under Texas Natural Resources Code section 91.404 (the division-order
statute). 7 Ellison later amended the petition to add Sunoco as a defendant with respect to the
claims for conversion and violations of the division-order statute. Concho counterclaimed for,
among other things, breach of contract and a declaratory judgment premised on the signed 2008
letter. Ellison and Samson settled, but Sunoco filed a crossclaim against Samson seeking
indemnity for Ellison’s claims against Sunoco.
Three motions for summary judgment on Ellison’s claims were filed by the various
defendants. Concho and Three Rivers filed a motion arguing that, by virtue of the signed 2008
letter, Ellison relinquished any claim of ownership of the disputed 154-acre tract, ratified the
boundary line established by the 2008 stipulation, and waived any right to a leasehold interest in
Ellison also sued S/D Oil and Gas Corporation, but the claims involving that defendant were severed and
6
dismissed, and they are not before us.
Ellison also initially asserted claims for negligence per se and violations of the Texas Theft Liability Act.
7
However, her second amended petition—the operative pleading in this case—does not include those claims.
7
the disputed tract. Sunoco filed a motion arguing in part that it is not a statutory “payor” that
may be held liable under the division-order statute and that the statute of limitations bars the
conversion claim. Because of Sunoco’s pending indemnity claim against Samson, Sunoco and
Samson also filed a joint traditional and no-evidence motion for summary judgment with respect
to Ellison’s claims against Sunoco concerning the time period when Samson operated the Sugg
wells. Ellison filed a cross-motion for summary judgment, arguing that she has superior title to
the disputed tract under the Pilon leases as a matter of law and that Concho and Three Rivers are
bad-faith trespassers.
The trial court granted the defendants’ motions and denied Ellison’s. The case then
proceeded to trial on Concho’s counterclaims. The jury found that the 2008 letter constitutes an
agreement between Ellison and Samson and that Ellison failed to comply. The jury awarded
$1,030 in reliance damages, almost $500,000 in lost profits, almost $400,000 in attorney’s fees
relating to the contract claim, and over $450,000 in attorney’s fees relating to the declaratory
judgment claim. The trial court rendered a judgment on the verdict with respect to the liability
finding, the award of reliance damages, and the award of attorney’s fees attributable to the
contract claim. The trial court rendered judgment notwithstanding the remainder of the jury’s
verdict, ordering that Concho recover nothing in lost profits or in attorney’s fees attributable to
the declaratory judgment claim. Finally, the judgment incorporated the trial court’s summary
judgment rulings dismissing Ellison’s claims with prejudice, declaring that the 2008 boundary
stipulation is enforceable, and declaring that the boundary between the Pilon and Sugg leases “is
the same as the common boundary line between [the northwest and southeast tracts] as identified
8
in” the stipulation. Ellison appealed, and Concho cross-appealed the portions of the judgment
that did not conform with the jury’s verdict.
The court of appeals reversed, holding that Ellison established as a matter of law both
that she has superior title to the disputed tract and that Concho is a bad-faith trespasser. 609
S.W.3d 549, 565 (Tex. App.—Corpus Christi–Edinburg 2019). In light of its holding regarding
title, the court of appeals also reversed the judgment on Concho’s counterclaims and held that a
genuine issue of fact exists as to the conversion claim against Sunoco. Id. at 565–66. On the
division-order-statute claim against Sunoco, the court held that a fact issue exists as to whether
Sunoco is a “payor” under the statute and that a four-year statute of limitations applies to the
claim. Id. at 569. The court rendered judgment granting Ellison’s motion for summary
judgment, denying all relief on Concho’s counterclaims, and remanding the case to the trial court
for further proceedings. Id. Concho and Three Rivers, Samson, and Sunoco all filed petitions
for review, which we granted. 8
II. Discussion
We begin with the trial court’s summary judgment in Concho’s favor on Ellison’s
trespass-to-try-title claim because resolution of that claim is potentially dispositive of Ellison’s
remaining claims against all the defendants. We review an order granting summary judgment de
novo, generally taking as true all evidence favorable to the nonmovant and indulging every
reasonable inference in the nonmovant’s favor. Valence Operating Co. v. Dorsett, 164 S.W.3d
656, 661 (Tex. 2005). When, as here, the parties file cross-motions for summary judgment and
8
Texas Oil and Gas Association submitted an amicus brief in support of the petitioners, and Texas Land
Title Association submitted an amicus letter in support of Ellison.
9
the trial court grants one and denies the other, we “consider both sides’ summary-judgment
evidence, determine all questions presented, and render the judgment the trial court should have
rendered.” Gilbert Tex. Constr., L.P. v. Underwriters at Lloyd’s London, 327 S.W.3d 118, 124
(Tex. 2010).
Concho primarily argues that the trial court correctly granted summary judgment on
Ellison’s trespass-to-try-title claim because Concho has conclusively established its ratification
defense. See Frost Nat’l Bank v. Fernandez, 315 S.W.3d 494, 508 (Tex. 2010) (“A defendant
who . . . conclusively establishes an affirmative defense is entitled to summary judgment.”).
Specifically, Concho contends that, by signing the 2008 letter “signify[ing] [his] acceptance of
the description of the Richey 147 acre tract as set out in” the boundary stipulation, Jamie
Ellison—and Marsha as his successor—ratified the stipulation as a matter of law. Alternatively,
Concho argues that the 2008 letter creates a fact issue on whether Ellison waived her claims,
requiring a remand rather than rendition of judgment in Ellison’s favor.
In rendering judgment for Ellison, the court of appeals held that the boundary stipulation
is void and thus incapable of being ratified. 609 S.W.3d at 562. The court held that the
stipulation is not itself a conveyance of the disputed acreage but is “close in nature to a
‘correction deed’ in which a party seeks to retroactively correct . . . some ‘ambiguity or error’” in
the original deed. Id. at 561 (quoting TEX. PROP. CODE § 5.027(a)). Examining the 1927 deed,
the court held that it unambiguously conveyed “all” of the tract northwest of the public road
(which includes the disputed tract), notwithstanding the inconsistent general acreage description.
Id. at 560 (citing Stribling v. Millican DPC Partners, LP, 458 S.W.3d 17, 21–22 (Tex. 2015)
(holding that a specific metes-and-bounds description controls over a conflicting general acreage
10
call unless it is clear from the deed’s language, read in light of the surrounding circumstances,
that the parties intended the general description to control)). The court further held that “the
evidence in the record suggests that the defendants were aware that the public road was the true
boundary” and that no “bona fide uncertainty or doubt [existed] as to the location of the
boundary.” Id. at 562. Accordingly, the court held that the 1927 deed contains no “ambiguity or
error” to correct, that the boundary stipulation is “invalid and void,” and that the 2008 letter
could not ratify the stipulation. Id. As to waiver, the court of appeals held that Ellison raised
issues of fact by presenting summary judgment evidence that Ellison continued to assert
ownership of the disputed acreage even after Jamie signed the 2008 letter. Id. at 563. 9
A. Ratification
“Ratification is the adoption or confirmation by a person with knowledge of all material
facts of a prior act which did not then legally bind him and which he had the right to repudiate.”
Fortune Prod. Co. v. Conoco, Inc., 52 S.W.3d 671, 678 (Tex. 2000) (citation and internal
quotation marks omitted). The defense “rests upon a manifestation of assent to confirm one’s
prior act or that of another.” Bocanegra v. Aetna Life Ins. Co., 605 S.W.2d 848, 851 (Tex.
1980); see also Ratification, BLACK’S LAW DICTIONARY (11th ed. 2019) (“A person’s binding
adoption of an act already completed but either not done in a way that originally produced a legal
obligation or done by a third party having at the time no authority to act as the person’s agent.”).
However, under longstanding common law, “a ‘void’ act” is “‘not susceptible of ratification.’”
9
Despite holding that issues of fact existed on Concho’s waiver defense, the court of appeals rendered
judgment for Ellison. 609 S.W.3d at 563, 565.
11
Wood v. HSBC Bank USA, N.A., 505 S.W.3d 542, 547 (Tex. 2016) (quoting Cummings v.
Powell, 8 Tex. 80, 85 (1852)). 10
Ellison argues that the court of appeals correctly held that the boundary agreement
between Section 1’s mineral-interest owners is void and that the 2008 letter thus cannot qualify
as a ratification of the agreement, while Concho contends that the boundary stipulation is
enforceable between the parties according to its terms. Alternatively, Concho asserts that the
stipulation is effective as a conveyance. We agree with Concho’s primary argument and do not
address its alternative argument.
On its face, the boundary stipulation addresses a “question [that] has arisen” among the
owners of the adjacent mineral estates in Section 1 “as to the physical location” of the northwest
tract, and it answers that question by establishing the location of the two tracts and the boundary
line between them. Importantly, the record mineral owners of both tracts—the Farmars and
Richey—agreed to resolve the identified boundary issue in accordance with the stipulation. See
Houston Oil Co. of Tex. v. Singleton, 44 S.W.2d 479, 481 (Tex. 1931) (holding that a
controversy regarding which of two surveys established a boundary line was settled by one
party’s execution of an instrument agreeing to the line in one of the surveys and the other party’s
acceptance of the instrument). We have said that such “settlements of boundary are common,
approved, and encouraged by the courts, and ought not to be disturbed,” regardless of whether “it
10
We have said that under certain circumstances, a void deed may be ratified by a formal recognition of its
validity. See Reserve Petroleum Co. v. Hodge, 213 S.W.2d 456, 459 (Tex. 1948). Because we hold that the
stipulation was not void, we need not address whether a contrary holding would summarily foreclose Concho’s
ratification defense.
12
was afterwards shown that they had been erroneously settled.” Levy v. Maddux, 16 S.W. 877,
878 (Tex. 1891).
The court of appeals concluded that the 1927 deed is objectively unambiguous as to the
“true” location of the boundary line—the public road—and that the mineral owners’ agreement
to establish the line elsewhere in accordance with the Samson survey is thus null and void. 609
S.W.3d at 562. 11 Concho argues that imposing this “objective uncertainty” requirement “would
scuttle boundary agreements as a mechanism to avoid litigation” because parties will never know
whether their informal settlement of a boundary dispute is effective until it is declared so by a
court. We agree. 12
The Farmars and Richey could have gone to court to obtain a determination of the
location of the boundary between their mineral estates. Had they done so, perhaps the court
would have concluded, as Ellison contends and the court of appeals held, that the 1927 deed is
unambiguous, the inconsistent acreage calls are immaterial, and the public road is the boundary
line. But they chose to resolve the “question” that had “arisen” about the boundary location
11
As noted, the court of appeals described the boundary stipulation as “close in nature to a ‘correction
deed’ in which a party seeks to retroactively ‘correct the defects and imperfections’ of the original deed.” 609
S.W.3d at 561 (quoting Myrad Props., Inc. v. LaSalle Bank Nat’l Ass’n, 300 S.W.3d 746, 750 (Tex. 2009)). Unlike
correction deeds, which are governed by Texas Property Code sections 5.027–.030, the boundary stipulation does
not purport to “replace[]” either the 1927 deed or the 1930 deed. TEX. PROP. CODE § 5.030(b). It is an agreement
between owners of adjacent property regarding the location of the boundary between their tracts, and nothing in the
statutory provisions governing correction deeds affects the validity of such an agreement.
12
In Gulf Oil Corp. v. Marathon Oil Co., we stated that “[w]hen there is uncertainty, doubt or dispute as to
where the true division line between the lands of the parties may be, they may fix it by parol agreement, which will
be mutually binding upon them, even though they were mistaken as to the true location of the line.” 152 S.W.2d
711, 714 (Tex. 1941). The court of appeals cited Gulf Oil to support its conclusion that the lack of any objective
uncertainty about the boundary line renders the stipulation invalid. See id. (“The existence of uncertainty, doubt or
dispute is essential to the validity of such agreement.”). However, the court of appeals also recognized that Gulf Oil
“by its nature” applies “to cases involving express oral boundary agreements or implied boundary agreements,”
neither of which is at issue here. 609 S.W.3d at 561 (emphasis added). In any event, Gulf Oil mandates “doubt or
uncertainty in the minds of the parties,” not objective ambiguity in the relevant conveyance instruments. 152
S.W.2d at 718 (emphasis added).
13
informally by executing the stipulation. See Levy, 16 S.W. at 878 (noting that “agreements of a
recent date, where there was doubt, and whether the parties were right or wrong in their belief
that the line they established and agreed upon as the boundary of their land was precisely where
it ought to be, have been encouraged, favored, and upheld”). We see no reason to second-guess
the owners’ decision to bind themselves in that manner without resorting to litigation. 13
Ellison argues that, by stating an effective date of July 8, 1987, the stipulation purports to
retroactively and impermissibly bind Ellison to the mineral owners’ stipulated boundary line.
Amicus Texas Land Title Association similarly argues that condoning such retroactive changes
will inject uncertainty into deed records and call into question the standard interpretation of legal
descriptions. We agree, and Concho does not dispute, that the boundary stipulation could not by
itself bind others who had an interest in the tracts and were not parties to the agreement. 14 Thus,
while we hold that the boundary stipulation is a valid agreement between the mineral owners of
the two tracts at issue, 15 it does not bind Ellison to the agreed boundary line.
However, as discussed, in October 2008, Reece (Samson’s landman) sent Ellison a letter,
with the boundary stipulation enclosed, requesting that Ellison “signify your acceptance of the
13
The court of appeals stated that “evidence in the record suggests that the defendants were aware that the
public road was the true boundary.” 609 S.W.3d at 562. However, the defendants were not parties to the boundary
stipulation. Further, the evidence the court cited does not support its conclusion. For example, the court stated that
if the public road were not the “true” boundary, then Samson’s 2006 request that Ellison and Richey agree to a
Rule 37 spacing exception for the Sugg Well #1 “makes no sense and serves no purpose.” Id. Given the concerns
raised by the title opinion, however, the exercise of such caution before drilling makes perfect sense.
14
We note that even a valid correction deed, which is “effective as of the effective date of the recorded
original instrument of conveyance,” is subject to the interests of creditors and purchasers who acquired their
interests, without notice, after the date the original instrument was executed and recorded but before the date the
correction deed was executed and recorded. TEX. PROP. CODE § 5.030(a)(1), (c).
15
As stated, we need not reach Concho’s alternative argument that the boundary stipulation was effective
as a conveyance. That is, we do not hold that the stipulation constituted a conveyance or that the stipulation, in and
of itself, affects nonparties to the agreement.
14
description of the Richey 147 acre tract as set out in the Stipulation (your leasehold), by signing
both copies of this letter in the space provided below and return one copy to my attention.”
Jamie Ellison signed the letter and returned it to Reece, thereby confirming his acceptance of the
boundary line agreed to in the stipulation as the leasehold boundary, 16 even though he was not
legally required to do so. Fortune Prod. Co., 52 S.W.3d at 678. And Samson did not begin
drilling north of the public road until after the letter was signed.
Ellison argues that, even if the boundary stipulation could have been ratified, the signed
letter is not a valid ratification because Jamie Ellison was fraudulently induced into signing it by
Reece’s misrepresentations. See Denton v. English, 157 S.W. 264, 266 (Tex. App.—San
Antonio 1913, no writ) (“The law favors agreements as to boundaries, which are fairly made, but
it condemns fraud in obtaining such an agreement just as it would any other agreement obtained
by fraud.”). But we see no record evidence of such misrepresentations. It is true that the letter
describes the stipulation as being “dated July 8, 1987,” presumably in reference to the effective
date chosen by the parties who signed it. But the stipulation itself was enclosed with the letter,
and the parties manifestly executed the stipulation in 2008. The letter does not communicate that
Ellison was required to accept the boundary line in the stipulation, nor does the letter contain any
representations about the legal effect of the stipulation. To the extent that Ellison relies on
evidence of conversations between Reece and Jamie Ellison before he signed the letter, the only
evidence of the content of those conversations is Reece’s affidavit, in which he averred that “Mr.
Ellison acknowledged to me his understanding that Ellison Lease Operating’s lease from Richey
16
The fact that the letter does not use the word “ratify” is immaterial. Jamie Ellison agreed to accept the
description of the northwest tract (“your leasehold”) contained in the boundary stipulation. In doing so, he accepted
the boundary line contained in the stipulation, even though he was not a party to it.
15
consisted of only 147 acres and otherwise comported with Suggs’ and Richey’s understanding of
the common boundary between the parties.”
Ellison also notes the letter’s statement that “[u]pon your acceptance, a more formal and
recordable document will be provided.” She contends that Jamie Ellison’s acceptance of the
stipulation’s boundary line was only for the limited purpose of executing the “more formal and
recordable document,” which never occurred. However, we agree with Concho that this reading
is inconsistent with the letter’s text, which requests that Ellison “signify your acceptance of the
description of the Richey 147 acre tract as set out in the Stipulation (your leasehold)” by counter-
signing the letter. It does not ask Ellison to accept the stipulation by signing a future document,
nor does it purport to condition his acceptance on the execution of such a document. See Solar
Applications Eng’g, Inc. v. T.A. Operating Corp., 327 S.W.3d 104, 108–09 (Tex. 2010)
(explaining that a “condition precedent is an event that must happen or be performed before a
right can accrue to enforce an obligation” and that, absent the use of conditional language, a term
will be construed as a promise rather than a condition if such a construction is reasonable). We
do not view the absence of the contemplated “more formal and recordable document” as fatal to
Concho’s ratification defense.
Finally, at various points throughout the litigation, Ellison has raised the possibility that
Jamie’s signature on the 2008 letter was forged. She points to no evidence in the record
supporting this assertion but argues that, at a minimum, she is entitled to a remand to conduct
discovery on that issue in the trial court. However, Ellison did not file a verified denial of that
point as the procedural rules require. TEX. R. CIV. P. 93(7). Nor is there any indication that she
filed a verified request for a continuance to further explore the issue. See TEX. R. CIV. P. 166a(g)
16
(“Should it appear from the affidavits of a party opposing the motion [for summary judgment]
that he cannot for reasons stated present by affidavit facts essential to justify his opposition, the
court may refuse the application for judgment or may order a continuance to permit affidavits to
be obtained or depositions to be taken or discovery to be had or may make such other order as is
just.”).
We hold that, in light of the valid boundary stipulation and the signed 2008 letter, Ellison
as a matter of law ratified the boundary line contained in the stipulation as the boundary of
Ellison’s leasehold.
B. Additional Legal Arguments
Ellison raises several additional arguments in support of her trespass-to-try-title claim
that we address in turn. First, Ellison argues that equitable defenses like ratification are
categorically unavailable in a trespass-to-try-title action. 17 We disagree. The procedural rules
provide that, upon pleading “not guilty” in a trespass-to-try-title suit, “the defendant may give in
evidence any lawful defense to the action except the defense of limitations, which shall be
specially pleaded.” TEX. R. CIV. P. 789. As a general matter, we have held that such a plea
allows the defendant to “interpose any legal or equitable defense that tends to defeat the
plaintiff’s right to recover.” Kauffman v. Brown, 18 S.W. 425, 427 (Tex. 1892) (emphasis
added); see also Hancock v. Booker, 608 S.W.2d 811, 815 (Tex. App.—Waco 1980, writ ref’d
n.r.e.) (same) (citing Guest v. Guest, 12 S.W. 831 (Tex. 1889) (holding that estoppel is a valid
defense to a trespass-to-try-title claim)).
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To the extent Ellison frames the issue as one of Concho’s “standing,” we agree with Concho that
standing has nothing to do with the availability of equitable defenses. Ellison, not Concho, is the trespass-to-try-title
plaintiff who must establish standing to assert her claim.
17
Ellison relies on Rogers v. Ricane Enterprises, Inc., 772 S.W.2d 76 (Tex. 1989)
(Rogers I), to support her assertion regarding the unavailability of equitable defenses, but that
reliance is misplaced. In Rogers I, we said only that the defense of laches, which is premised on
a plaintiff’s unreasonable delay in asserting claims, “is not a defense in a trespass to try title suit
where the plaintiff’s right is based on legal title.” Id. at 80. We said nothing about any other
equitable defense. Ellison further claims that we foreclosed ratification as a trespass-to-try-title
defense in a subsequent appeal in the same case. See Rogers v. Ricane Enters., Inc., 884 S.W.2d
763, 769–70 (Tex. 1994) (Rogers II). Again, Ellison is mistaken. In Rogers II, we rejected the
jury’s ratification finding because the evidence did not support it, not because the defense was
categorically unavailable. Id.Next, Ellison contends that abandonment of title to real property is not recognized in
Texas. 18 On that point, she is correct. Rogers I, 772 S.W.2d at 80. However, Concho is not
claiming that Ellison abandoned her title. See Trenolone v. Cook Expl. Co., 166 S.W.3d 495,
500–01 (Tex. App.—Texarkana 2005, no pet.) (explaining that “abandonment” of personal
property is “the relinquishment of possession of a thing by the owner with the intention of
terminating his ownership, but without vesting it in any one else” (emphasis added) (quoting
Pearson v. Black, 120 S.W.2d 1075, 1079 (Tex. App.—Eastland 1938, no writ))). Rather,
Concho claims, and conclusively demonstrated, that Ellison ratified the location of the boundary
line between Ellison’s leasehold and the adjacent leasehold. Ratification is not abandonment.
18
Though Ellison primarily argues that she obtained leasehold title to all 301 acres north of the public road
via written conveyance, she alternatively argues that she obtained such title by adverse possession and that title
obtained by adverse possession similarly cannot be abandoned.
18
Ellison also relies on the doctrine of estoppel by deed, which “[i]n the broadest
sense . . . stands for the proposition that all parties to a deed [and their privies] are bound by the
recitals in it, which operate as an estoppel.” Trial v. Dragon, 593 S.W.3d 313, 318 (Tex. 2019).
This appears to be a modified version of the argument that objective ambiguity is required to
justify a boundary agreement. As discussed, adjacent owners are free to resolve uncertainty
amongst themselves regarding a boundary location. Singleton, 44 S.W.2d at 481. The estoppel-
by-deed doctrine simply does not apply to written boundary agreements.
Finally, as a general matter, Ellison’s briefing paints a picture of an elaborate land-grab
scheme orchestrated by Samson. To be sure, the title opinions Samson obtained expressed
serious concerns about Samson’s leasehold interest, both because of the vague legal description
of the “493 acres” in its lease and the deeds passing title to the southeast tract, and because of the
1927 deed’s reference to the public road. Further, Samson does not dispute that it drafted the
boundary stipulation that the Farmars and Richey signed. But we fail to see how those facts
render the stipulation invalid. Moreover, to the extent Ellison asserts that Samson “preyed upon
and/or instigated” uncertainty among the mineral owners, there is simply no evidence to support
such an assertion. The parties to the boundary stipulation agreed to resolve their uncertainty
about the location of the boundary between the mineral estates, and Ellison ratified that boundary
location with respect to the leasehold interests. The trial court correctly granted summary
judgment in the defendants’ favor on Ellison’s trespass-to-try-title claim and bad-faith trespass
claim.
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C. Remaining Claims
Ellison’s remaining claims, including her claims for conversion and violations of the
division-order statute against Sunoco (for which it seeks indemnity from Samson), hinge on the
validity of her trespass-to-try-title claim. Because the trial court correctly granted summary
judgment on that claim, Ellison’s remaining claims fail as a matter of law. We thus need not
address Samson and Sunoco’s argument that those claims would fail even if the trespass-to-try-
title claim did not.
Finally, with respect to the trial court’s judgment for Concho on its counterclaims for
breach of contract and declaratory judgment, the court of appeals reversed that portion of the
judgment because of the court’s erroneous holding regarding Ellison’s title. For the same reason,
the court of appeals did not address Concho’s cross-appeal regarding the portion of the trial
court’s judgment that declined to award Concho some of the damages and attorney’s fees found
by the jury. In light of our conclusion about the title claim, we remand the case to the court of
appeals to consider the unaddressed issues relating to the counterclaims.
III. Conclusion
The trial court correctly granted summary judgment for the defendants on Ellison’s
claims. Accordingly, we reverse the court of appeals’ judgment, reinstate the portions of the trial
court’s judgment incorporating its summary judgment orders, and remand the case to the court of
appeals to consider the parties’ unaddressed issues regarding Concho’s counterclaims.
_________________________________
Debra H. Lehrmann
Justice
OPINION DELIVERED: April 16, 2021
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