Gastar Exploration and Rona Lee McCardle v. Gary Rine, Administrator, etc.
239 W. Va. 792
| W. Va. | 2017Background
- In 1957 Clifford and Beulah Franklin conveyed 102.08 acres to Okey and Frances Yoho but expressly reserved an undivided one-half interest in the oil and gas; the Yohos received the other one-half.
- In 1977 the Yohos conveyed the same tract to Rona Lee McCardle by a general warranty deed that included an "excepted and reserved" paragraph identical to the Franklins’ 1957 oil-and-gas reservation.
- Tax records before 1977 show the Yohos paid taxes on a one-half oil-and-gas interest; after the 1977 deed, records show McCardle paid taxes on the one-half oil-and-gas interest and the Yohos stopped paying.
- McCardle leased the property to Gastar in 2008 and Gastar produced oil and gas from the tract.
- In 2013 administrator Gary Rine and Yoho heirs sued McCardle and Gastar, seeking declaration that the Yohos retained their one-half oil-and-gas interest and damages for trespass/conversion; parties limited litigation to a declaratory judgment and filed cross motions for summary judgment.
- The circuit court ruled the 1977 deed was unambiguous and the Yohos retained the one-half mineral interest; the Supreme Court of Appeals reversed, holding the deed ambiguous and construing it in favor of the grantee based on extrinsic evidence (tax records showing McCardle paid the mineral taxes).
Issues
| Issue | Plaintiff's Argument (Yoho heirs) | Defendant's Argument (McCardle/Gastar) | Held |
|---|---|---|---|
| Whether the 1977 deed conveyed the Yohos’ one-half oil-and-gas interest | The deed’s "excepted and reserved from this conveyance" clause unambiguously reserves the one-half mineral interest to the Yohos | The deed is ambiguous: the opening grant conveys "the same property" the Yohos received in 1957; later language may refer to the Franklins’ prior reservation or otherwise was poorly drafted | Deed is ambiguous; construed against grantors and in favor of grantee — McCardle owned the one-half interest |
| Whether extrinsic evidence is admissible to resolve the deed | Not necessary if deed is unambiguous | Admissible because the deed is ambiguous; parties’ conduct (tax payments) is relevant | Extrinsic evidence (tax records showing McCardle paid mineral taxes after 1977) considered and supports grantee |
| Proper construction when multiple reasonable interpretations exist | Court should give effect to plain language reserving minerals | Ambiguity allows several reasonable constructions, including that Yohos conveyed their interest | Where ambiguous, adopt construction most favorable to grantee (McCardle) |
| Whether summary judgment for plaintiffs was proper | Yes; deed is unambiguous so declaratory judgment for plaintiffs appropriate | No; deed ambiguous and summary judgment should favor defendants given extrinsic evidence | Summary judgment for plaintiffs reversed; judgment should be entered for defendants |
Key Cases Cited
- Cox v. Amick, 195 W.Va. 608 (court’s entry of declaratory judgment reviewed de novo)
- Employers’ Liab. Assur. Corp. v. Hartford Acc. & Indem. Co., 151 W.Va. 1062 (summary judgment may be rendered against the moving party when appropriate)
- State v. Herold, 76 W.Va. 537 (extrinsic evidence admissible to ascertain intent where deed description is inconsistent or ambiguous)
- Snider v. Robinett, 78 W.Va. 88 (parol/extrinsic evidence admissible to construe latent ambiguities and show parties’ subsequent conduct)
- Estate of Tawney v. Columbia Nat. Res., L.L.C., 219 W.Va. 266 (definition of ambiguity: language reasonably susceptible to two meanings)
- Paxton v. Benedum-Trees Oil Co., 80 W.Va. 187 (where a deed admits of two constructions, adopt the one most favorable to the grantee)