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THOMAS W. CREWS v. PLAINSMAN TRADING COMPANY (03/11/92)

delivered: March 11, 1992.

THOMAS W. CREWS, SR. AND DOROTHY W. CREWS, AND URI, INC., APPELLANTS
v.
PLAINSMAN TRADING COMPANY, APPELLEE



Appeal from the 229th District Court of Duval County. Trial Court No. 13,904. Honorable Ricardo H. Garcia, Judge Presiding

COUNSEL

ATTORNEYS FOR APPELLANT, Dean, Jr., Homer E., Spoor, Tracy L., DEAN & HUNT, P.C., P.O. Drawer 150, Alice, TX 78333-0150. Cooper, Jr., J. W., COOPER AND COOPER, 1550 Texas Commerce Plaza, 802 N. Carancahua, Corpus Christi, TX 78470.

ATTORNEYS OF APPELLEE, Hannam, Kenneth R., MAHONEY, SHAFFER & LAYTON, P.O. Box 6369, Corpus Christi, TX 78466-6369.

Sitting: Alfonso Chapa, Justice, Fred Biery, Justice, Gerald T. Bissett, Justice*fn1

Author: Bissett

ON APPELLANTS' AND APPELLEE'S MOTIONS FOR REHEARING

The opinion of this court dated January 22, 1992 is withdrawn and this opinion is substituted therefor.

This is an appeal from a summary judgment rendered in favor of Plainsman Trading Company in a suit for a declaratory judgment to determine the ownership of an undivided one-half (1/2) of the uranium underlying a tract of 1,956.7 acres of land in Duval County, Texas. We reverse and remand.

Thomas W. Crews and wife, Dorothy W. Crews, hereafter "Crews," the surface owners of the 1,956.7 acres and the owners of the remaining one-half (1/2) of the uranium (and other minerals) underlying the land filed suit against Plainsman Trading Company, hereafter "Plainsman," the purported owner of an undivided one-half (1/2) of the uranium in and under the land, certain named persons who were purported owners of non-participating royalties, and against Uri, Inc., hereafter "Uri," who is the successor in interest to the original lessor in a uranium lease theretofore executed by the Crews, as lessors, covering the land. Plainsman then filed a counterclaim against Crews and Uri, seeking a declaratory judgment that it owned an undivided one-half (1/2) of the uranium on, in and under the land. Plainsman based its claim on a reservation contained in a deed dated March 14, 1963 from Cattle Land Oil Company and O.S. Wyatt, Jr., as grantors, to Thomas W. Crews, as grantee, whereby the 1,965.7 acres were conveyed to the grantee. The deed expressly reserved unto the grantors, their heirs, successor and assigns, "an undivided one-half (1/2) of the minerals in and under said land." The conveyance will henceforth be referred to as "the Deed," and the land conveyed thereby will be referred to as "the Crews' Property."

Both Crews and Plainsman filed motions for summary judgment. Uri did not file such motion, but did align itself with and actively supported Crews in their motion.

Crews alleged in their motion: 1) uranium deposits located on, in and under the Crews' Property are within 200 feet of the surface of the land, and all such "near surface" uranium belongs to them as a matter of law; 2) Uri has an interest in the uranium because of the existing uranium lease between them, as lessors, and Uri, as lessee; 3) open pit mining was a reasonable method of extracting uranium on March 14, 1963, the date of the Deed; and 4) both the open pits mining method and the in situ (solution mining) method of extracting uranium will result in substantial harm, depletion, impairment and destruction of the surface of the land for agricultural and grazing purposes.

Plainsman alleged in its motion: 1) it is the owner of an undivided one-half (1/2) of the uranium in and under the Crews' Property by virtue of the reservation "of the minerals in and under said land" contained in the aforesaid Deed, because the reservation is "clear and unambiguous"; and 2) there is no genuine issue of material facts necessary to establish its title and ownership of its one-half (1/2) of the uranium and uranium rights in and under the land.

The trial court denied Crews' motion and granted Plainsman's motion. The Crews' have appealed from the judgment denying their motion for summary judgment, and they and Uri have appealed the judgment granting Plainsman's motion.

The action brought by Crews against the purported owners of non-participating royalties was severed from their action brought against Plainsman and Uri. Therefore, the summary judgment, signed on April 18, 1991, which held that Plainsman is the owner of an undivided one-half (1/2) in and to all uranium, including but not limited to, uranium, thorium, vanadium and molybdenum, in, on and under the Crews' Property, is a final judgment.

When both plaintiff and defendant file motions for summary judgment and one motion is granted, and the other is denied, the trial court's judgment becomes final and appealable. Jones v. Strauss, 745 S.W.2d 898, 900 (Tex. 1988); Tobin v. Garcia, 159 Tex. 58, 316 S.W.2d 396, 400 (1958).

When both parties move for summary judgment, each party must carry his own burden as movant, James v. Hitchcock Indep. School Dist., 742 S.W.2d 701, 703 (Tex. App.--Houston [1st Dist.] 1987, writ denied), and all of the summary judgment evidence accompanying both motions should be considered by the trial court in deciding whether or not to grant either party's motion. DeBord v. Muller, 446 S.W.2d 299, 301 (Tex. 1969); Villarreal v. Laredo Nat'l Bank, 677 S.W.2d 600, 605 (Tex. App.--San Antonio 1984, writ ref'd n.r.e.). However, the trial court must indulge all reasonable inferences and resolve all doubts in favor of the losing party. University of Texas Health Science Center v. Big Train Cadet of El Campo, Inc., 739 S.W.2d 792 (Tex. 1987). Under TEX. R. CIV. P. 166a, a summary judgment may be rendered only if the pleadings, depositions, admissions and affidavits show 1) that there is no genuine issue as to any material fact, and 2) the moving party is entitled to judgment as a matter of law. See also, MMP, Ltd. v. Jones, 710 S.W.2d 59, 60 (Tex. 1986). As said in Futch v. Greer, 353 S.W.2d 896, 898-99 (Tex. Civ. App.--Amarillo 1962, writ ref'd n.r.e.), cert. denied, 372 U.S. 913, 83 S. Ct. 728, 9 L. Ed. 2d 721 (1963), quoted by the supreme court in DeBord:

We do not construe Rule 166-A, Texas Rules of Civil Procedure as requiring that a motion for summary judgment can be controverted only by affidavits specifically replying to such motion. In our opinion appellees' own motion for summary judgment supported by affidavits and exhibits attached thereto, together with the deposition of appellee . . . , constituted sufficient opposition to appellants' motion.

DeBord, 446 S.W.2d at 301. We therefore, consider all of the summary judgment evidence presented by both appellants and appellees in deciding whether a correct judgment was rendered by the trial court.

Crews contend in their first point of error:

The trial court erred in denying summary judgment to Crews as surface owner that the uranium underlying Crews land within 200 feet of the surface belongs to Crews as surface owner as a matter of law under the surface destruction test of the Texas Supreme Court where the general terms 'minerals' was used in a 1963 deed reservation.

Both the Crews' and Uri contend that the trial court erred: 1) in ruling that the term "minerals" as used in the deed includes uranium, uranium ore and uranium rights; and 2) in granting Plainsman's motion for summary judgment for the reason that there exists a genuine issue of material fact.

The trial court had before it at the hearing certain stipulations and summary judgment evidence in the form of a certified copy of the Deed, and depositions and affidavits attached to the motions by Crews and Plainsman, the responses by each of them to the others' motions, and a response filed by Uri to Plainsman's motion.

It was stipulated by all parties to the litigation: 1) that commercial grade and quantity of uranium is located on the Crews' Property at depths ranging generally from 150 to 190 feet in depth below the surface of the grounds; 2) that open pit mining of uranium destroys the surface; and 3) that the reservation in the Deed is "clear, complete and unambiguous." It is also shown that Plainsman is the successor in interest to the grantors in the Deed and that Uri is the successor in interest to Uranium Resources, Inc., the original lessee in the aforesaid uranium lease of the Crews.

The Crews' and Uri's summary judgment evidence consisted of the affidavits of Thomas W. Crews, William M. McKnight, a geologist and Chief Operating Officer of Uri, and Robert B. Smith, a geologist. They also presented portions of depositions from Mr. Mcknight and Mr. Smith. Mr. Crews testified that he had examined in situ mining operations then being conducted on land adjoining the Crews' Property, and open pit mining operations on lands in McMullen County, and that both mining operations would substantially destroy the surface of his land. Mr. Mcknight stated in his affidavit that, based upon his examination and study of the well logs and other available data on the Crews' Property, he had determined that commercial grade and quantity uranium ore resources are found thereon at depths ranging between 150 feet and 190 feet in depth; that open pit mining is, technically, a reasonable method of extracting and producing the uranium underlying the Crews' Property; that it is economically feasible to mine the uranium by open pit mining; that such a mining method will destroy the surface; that on March 14, 1963, open pit mining was the only method utilized in South Texas for the mining of uranium; that the "in situ leach" or solution mining was first used in South Texas in 1975; and whether either open pit mining or solution mining methods are employed in extracting uranium ore, the surface of the Crews' Property will be substantially harmed, injured, consumed, depleted or destroyed. To the same effect is the affidavit of Mr. Smith. Mr. McKnight, however, testified in his deposition that the open pit mining method would not be reasonable under the "1989 Uri average blending costs"; that the reasonable method of mining uranium ore (in 1989) would be by the solution method which would cause less damage to the surface than the open pit method, and while the surface would be damaged, it would not result in total destruction of the surface.

Plainsman, in its motion for summary judgment, in addition to attaching the Deed to its motion as an exhibit, also referred the trial court to "all the pleadings, affidavits, depositions and the answers to all discovery matters now on file." It also presented deposition testimony of Edward L. Oakes, a mining engineer, who stated that he had made a study of the Crews' Property, and in his opinion, open pit mining was not feasible because the extraction of uranium by the "in situ" process would be less costly than extraction by the open pit process; and that in situ, or solution mining, will not destroy the surface of the land.

Crews and Uri contend in their briefs that the reservation of "the minerals" in and under the Crews' Property, having been made in a Deed executed prior to June 8, 1983, the date of the first opinion in Moser v. United States Steel Corp., 676 S.W.2d 99 (Tex. 1984) must be construed in accordance with the rules of Acker v. Guinn, 464 S.W.2d 348 (Tex. 1971), Reed v. Wylie, 554 S.W.2d 169 (Tex. 1977) ("Reed I"), and Reed v. Wylie, 597 S.W.2d 743 (Tex. 1980) ("Reed II").

Plainsman contends that the reservation of "an undivided one-half (1/2) of the minerals in and under said land," as stated in the Deed, is clear and unambiguous, and, therefore, the "surface destruction test" is not applicable. Consequently, it is the owner of an undivided one-half (1/2) of the uranium as a matter of law as determined by the trial court.

The question presented in Acker was whether an interest in the iron ore passed to the grantee in a deed executed in 1941 and purporting to convey "an undivided 1/2 interest in and to all of the oil, gas and other minerals in and under, and that may be produced from" a certain tract of land. The iron ore deposits varied in thickness from a few inches to three or four feet and ranged in depth to as much as fifty feet below the surface. The court concluded that iron ore was not conveyed by the deed because removal of the iron ore would consume or deplete the surface; it held:

Unless the contrary intention is affirmatively and fairly expressed, therefore, a grant or reservation of 'minerals' or 'mineral rights' should not be construed to include a substance that must be removed by methods that will, in effect, consume or deplete the surface estate.

Acker, 464 S.W.2d at 352. The law announced in Acker has been described as the "surface destruction test." The rationale was that the parties to a mineral reservation (or grant) did not generally intend the minerals to be reserved (or granted) if the mining of those minerals would destroy the surface and thus deprive the owner of the use of his land.

The Texas Supreme Court reaffirmed the rule laid down in Acker, when it decided Reed I in 1977. In that case, the reservation was made in a deed, dated September 30, 1950, wherein there was reserved to the grantors "a one-fourth (1/4) interest in and to all oil, gas and other minerals on or under" the land conveyed. The issue was whether the ...


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