a valid correction deed was issued and thereafter recorded? Are any of the present day ownerships in a similar chain of title in danger of being overturned? Yes, as aptly demonstrated by Broadway. More significantly, and NOT addressed by the Court, what if Yates Energy/EOG Resources et al. are not BFP’s for value (determined on remand)? Are Yates Energy/EOG Resources barred by the Statute of Limitations from recovering the money spent to acquire their royalty interest? Are the remaindermen under John’s life estate unleased cotenants? Unknown. Author’s Comment: This case result and the rules of law announced in it simply will not work given Texas’ reliance on recorded title and filing out of sequence/date “correction deeds”. It is patently obvious that the drafter(s) of the Correction Deed Legislation had no/minimal input from true title examiners (landmen) or sovereignty of the soil title examining attorneys. Otherwise, this legislation, in its present form, hopefully would not have been submitted to the Texas Legislature for approval. A title company is set up geographically by county/ abstract number as opposed to running a title based on an examination of the official county deed records. A title company will easily be able to find a correction deed in its records (if it was picked up and correctly filed) whereas the title examination methodology in a county’s deed records required by this case will drastically increase the costs of run sheet preparation and actual title examination by a title attorney. However, an abstract/title company is not the official depository of recorded documents in Texas coupled with the fact that they are notoriously inaccurate for reflecting purely oil and gas conveyances in their abstract files. Abstract companies focus on surface title and title insurance; they do not focus on being an exact mirror of the county deed records when it comes oil and gas conveyances. Allowing for “self-help” to correct a mistake in a prior deed is one thing; allowing that “self-help” to potentially divest otherwise clearly vested titles and benefitting one industry (title insurance) to the exclusion of others is reprehensible. The Correction
Deed legislation should immediately be reconsidered and, at the least, a four year statute of limitations to file a correction deed, commencing on the date the “incorrect” deed is filed for record , should be put in place. The author is not discounting other changes that could or should be made to the Correction Deed Legislation. Rather, a new legislative committee, comprised of representatives from the title insurance industry, the title examiner’s industry (landmen) and title examination attorneys should be convened, and recommendations made to the next Texas Legislature to correct the deficiencies of the legislation and this decision.
© Terry E. Hogwood 2022
EXHIBIT “A” I. “The Bank complains that the statutory text does not support the court of appeals’ preference for the joinder of alternates merely because they exist. We agree to the extent that nothing in the text of 5.029 indicates a preference one way or the other: Either that the Legislature intended for the original parties to sign, if they were available, or that it intended for an alternate to sign, once the alternate acquired an interest in the original conveyance. If the Legislature’s intent was the latter, however, the Bank reasonably questions why it chose “if applicable” to express that intention, instead of a simply providing that correction deeds must include the signatures of all current property owners. The court of appeals, however, was persuaded to that view by a concern that the Bank’s “interpretation would render the conditional clause, ‘if applicable,’ meaningless.” Id. II. Whether the “if applicable” phrase is triggered by the transfer of title or by the absence of an original party makes no difference when the alternative is the original party’s heirs or successors.5 Under either scenario, the original party is not available to execute a correction instrument and title is held by another. Thus, either party’s interpretation is
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N at i onal A ssociation of D i v i s i on O rder A nalys t s
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