SCOTT v. PETERS
388 P.3d 699
| Okla. | 2016Background
- Steven B. Scott (grantor) conveyed 120 acres by warranty deed in 1997 and later 40 acres in 2000 to Martin and Tammy Peters (grantees); the 2000 deed contained no mineral reservation.
- In 2001 Scott executed and recorded another warranty deed covering the same 160 acres to Larry Russell; that deed made no mineral reservation and was recorded March 19, 2001. Russell then conveyed to the Wicherts, who later quitclaimed to the Peters (recorded January 28, 2002).
- The Peters leased the minerals under the 160-acre tract in 2008 and filed the lease in county records in May 2008.
- In August 2014 Scott sued the Peters seeking to quiet title to mineral interests and claiming unjust enrichment, alleging he intended to reserve minerals in earlier deeds.
- The Peters moved for summary judgment asserting Scott’s claims are time-barred because recorded deeds (including Scott’s 2001 deed without mineral reservations) put him on constructive notice and started the statute of limitations.
- The trial court ultimately granted summary judgment for the Peters; the Oklahoma Supreme Court affirmed, holding the statute of limitations accrued when the non-reserving deed was recorded.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| When does the limitations period for a grantor’s claim to reform or quiet title to reserved minerals begin? | Scott: limitations tolls until he actually discovered the insufficiency; he didn’t learn of any problem until 2014 and the 1997 reservation was inartfully drafted so equitable tolling applies. | Peters: recorded deeds (including Scott’s 2001 deed lacking any mineral reservation) gave Scott constructive notice; limitations began at recording and bar the suit. | Court: limitations accrued upon recording of the non-reserving deed (2001); constructive notice precludes Scott’s late challenge. |
| Whether Nelson v. Daugherty rationale (equitable tolling for typographical reservation errors) controls here | Scott: Nelson allows equitable tolling/reformation where a drafting mistake caused the reservation error. | Peters: Nelson is distinguishable; here Scott later executed and recorded a deed with no reservation, placing him on notice. | Court: Nelson is distinguishable; tolling not warranted under these facts. |
| Whether a reservation clause in an earlier deed can save a late claim after a subsequent recorded deed conveys the same property without reservation | Scott: earlier reservation (1997) should start limitations later or allow reformation. | Peters: later deed (2001) without reservation evidences that minerals were conveyed and supplies constructive notice. | Court: later recorded deed controls for notice; earlier inartful reservation does not save untimely claim. |
| Whether equity can excuse the delay and allow reformation after long lapse absent mutual mistake or fraud | Scott: equity should permit correction because he didn’t understand legal effect. | Peters: equitable relief requires clear, convincing proof of mutual mistake or fraud; none shown. | Court: equity does not excuse delay absent clear, convincing mutual mistake or fraud; Scott failed to meet that burden. |
Key Cases Cited
- Nelson v. Daugherty, 357 P.2d 425 (Okla. 1960) (permitting equitable reformation in a typographical reservation error under particular facts)
- Whitman v. Harrison, 327 P.2d 680 (Okla. 1958) (to create a reservation the instrument must clearly express the grantor's intent to reserve)
- Good v. Cohlmia, 330 P.2d 588 (Okla. 1958) (tolling statute where parties’ conduct suggested different ownership despite a typographical error in reservation)
- Board of Comm’rs of Garfield County v. Renshaw, 99 P. 638 (Okla. 1909) (recorded transactions provide constructive notice; parties charged with facts discoverable by reasonable diligence)
- Cutright v. Richey, 257 P.2d 286 (Okla.) (a grantor is presumed to have made all reservations intended and cannot later contradict the deed)