Johnson v. Shield
2015 ND 200
| N.D. | 2015Background
- In 1942 Eugenie and Roy Goldenberg conveyed a Williams County tract to Julian and Arthur Johnson via a warranty deed; the granting clause did not mention minerals.
- At the time of conveyance the Goldenbergs owned all mineral rights.
- The warranty clause contained a typed insertion: “but reserving, however, to the grantor fifty per cent (50%) of all of the oil, gas, hydrocarbons and minerals in or with respect to said real property.”
- Johnson (successors to the grantees) sued to quiet title, claiming 100% of the minerals passed to them.
- Shield (successors to the Goldenbergs) claimed the deed reserved 50% of the minerals to the grantors.
- The district court granted cross-motions for summary judgment in favor of Shield; the Supreme Court affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the warranty-clause language reserved 50% of the minerals to the grantor or merely limited the warranty | Johnson: placement in warranty clause means it limits the warranty; granting clause conveys 100% | Shield: the phrase “reserving ... to the grantor” creates an actual reservation of a 50% mineral interest | Court: Unambiguous reservation to the grantor — reserved 50% of minerals; affirmed summary judgment |
| Whether extrinsic evidence was required because the clause was ambiguous | Johnson: the clause is ambiguous (citing Mueller/Stracka) and extrinsic evidence could show intent to limit warranty only | Shield: text is explicit enough to show reservation | Court: No ambiguity; phrase “to the grantor” is dispositive and makes no sense as a warranty limitation, so no extrinsic evidence needed |
Key Cases Cited
- Mueller v. Stangeland, 340 N.W.2d 450 (N.D. 1983) (warranty-clause mineral language found ambiguous; extrinsic evidence considered)
- Royse v. Easter Seal Soc’y for Crippled Children & Adults, Inc., 256 N.W.2d 542 (N.D. 1977) (exceptions/reservations should be set forth with prominence or be explicit to avoid doubt)
- Miller v. Kloeckner, 600 N.W.2d 881 (N.D. 1999) (exceptions in warranty clause generally protect grantor’s warranty but may not limit estate conveyed)
- Stracka v. Peterson, 377 N.W.2d 580 (N.D. 1985) (language reserving 50% of oil/minerals held ambiguous and construed as warranty limitation)