Benedict G. Wenske and Elizabeth Wenske v. Steve Ealy and Deborah Ealy, 521 S.W.3d 791

Background

In 1988 prior owners reserved a 1/4 nonparticipating royalty interest (NPRI) for 25 years (the Vyvjala NPRI) on a 55‑acre tract later owned by Benedict and Elizabeth Wenske.
In 2003 the Wenskes deeded the tract to Steve and Deborah Ealy. The deed granted the property "subject to the Reservations from Conveyance and the Exceptions to Conveyance and Warranty." It reserved for the Wenskes an undivided 3/8ths mineral interest and excepted the previously reserved 1/4 interest (referencing the 1988 instrument).
After oil-and-gas leases were executed, a dispute arose over how the Vyvjala 1/4 NPRI burden should be allocated between the Ealys (grantees with 5/8ths minerals) and the Wenskes (reservors with 3/8ths minerals).
Trial court granted summary judgment for the Ealys, holding the NPRI burden is shared proportionately by mineral ownership; the court of appeals affirmed. The Wenskes sought review.
The Supreme Court held the deed is unambiguous and that the parties’ intent—ascertained from the deed as a whole—controls; it affirmed the court of appeals’ judgment that the NPRI burden is shared proportionately.

Issues

Issue	Wenskes' Argument	Ealys' Argument	Held
Whether the deed’s "subject to" language made the grantees (Ealys) solely bear the entire Vyvjala 1/4 NPRI	The grant was "subject to" the reservations/exceptions and thus the Ealys’ conveyed interest alone is limited by the NPRI, leaving Wenskes’ reserved 3/8ths unburdened	The deed makes the whole mineral estate (both parties’ fractional interests) subject to the NPRI; burden should be allocated proportionately (5/8 vs 3/8)	Court held parties bear the NPRI burden in proportion to their fractional mineral interests; intent from the whole deed controls
Whether Bass v. Harper ("subject-to" tied to grant) dictates imposing the entire outstanding NPRI on the grantee	Bass requires giving effect to a subject-to clause tied to the grant; therefore Ealys alone bear NPRI	Bass is fact-specific and should be confined; modern deed construction focuses on parties’ intent from whole instrument	Court limited Bass to its facts and rejected applying it here as a controlling mechanical rule
Whether courts may apply default/mechanical rules (e.g., Pick/Pich proportional carving) when the deed is unambiguous	Argued for plain effect of subject-to language, not default rules	Relied on the ordinary property principle that a royalty carved from minerals ordinarily burdens mineral owners proportionally	Court: default rules are disfavored; but here the deed, read in full, manifests intent to share the NPRI proportionately, so proportional allocation affirmed
Proper interpretive approach to mineral deeds with reservations/exceptions	Favor a plain reading of the grant/subject-to language that limits only the granted interest	Favor harmonizing all parts of the deed to effectuate mutual intent and standard oil-and-gas principles	Court reaffirmed that courts must ascertain intent from the four corners, harmonize provisions, and avoid rigid, mechanical rules

Key Cases Cited

Bass v. Harper, 441 S.W.2d 825 (Tex. 1969) (construing a "subject to" clause tied to a grant and enforcing the deed’s specific wording)
Luckel v. White, 819 S.W.2d 459 (Tex. 1991) (unambiguous deed construction is a question of law and courts must ascertain intent from the four corners)
Hysaw v. Dawkins, 483 S.W.3d 1 (Tex. 2016) (intent determined by careful, detailed examination of the document in its entirety; disfavor mechanical rules)
Woods v. Sims, 273 S.W.2d 617 (Tex. 1954) (conveyance of minerals carries by operation of law a corresponding royalty interest)
Benge v. Scharbauer, 259 S.W.2d 166 (Tex. 1953) (parties may contract to allocate royalties differently; express terms control)
Pick v. Lankford, 302 S.W.2d 645 (Tex. 1957) (statement that royalty interest "ordinarily" is carved proportionately from multiple mineral ownerships)
Duhig v. Peavy-Moore Lumber Co., 144 S.W.2d 878 (Tex. 1940) (analyzing what the granting clause conveys and how reservations/exceptions reduce the grant)
Selman v. Bristow, 402 S.W.2d 520 (Tex. Civ. App.—Tyler 1966) (distinguishing deeds that convey absolute fractional mineral interests from deeds that subject a grant to prior reservations)
Averyt v. Grande, 717 S.W.2d 891 (Tex. 1986) ("subject to" clause limiting the estate granted and not merely the warranty)