Maynard v. McHenry
| Decision Date | 25 January 1938 |
| Citation | 113 S.W.2d 13,271 Ky. 642 |
| Parties | MAYNARD et al. v. McHENRY et al. |
| Court | Kentucky Court of Appeals |
Appeal from Circuit Court, Lawrence County.
Suit by E. E. Cunningham under the Declaratory Judgment Act for a declaration of the rights of Wayne Maynard and others and John P. McHenry and others to royalties for oil and gas. From an adverse judgment, Wayne Maynard and others appeal.
Judgment affirmed.
C. F See, Jr., of Louisa, for appellants.
Eldred E. Adams, of Louisa, for appellees.
The question for decision is whether the word "minerals" in a reservation in a deed includes natural gas and oil.
John McHenry, in 1871, executed a deed conveying to Charles Maynard 410 acres of land in Lawrence county for a consideration of $80. The deed contained the following reservation: "The party of the first part hereby reserves to himself and assigns the exclusive right to all minerals coal and oil privileges in or to said lands belonging with the right to enter thereon for the exploitation development and working of the same with all needful right of passway, etc."
The minerals have never been conveyed, and title to them is now in the heirs of John McHenry, who are the appellees. The title to the surface is now in Wayne Maynard and others, who are the appellants.
E. E Cunningham obtained an oil and gas lease from the owners of the mineral estate and also from the owners of the surface. A dispute arose between the owners of the surface and the owners of the mineral estate over the royalties, and Cunningham brought an action under the Declaratory Judgment Act, Civil Code of Practice § 639a-1 et seq., for a declaration of the rights of the parties. The owners of both the surface and the mineral estates were made defendants, and the case developed into a contest between these two sets of claimants. The circuit court adjudged that the heirs of John McHenry were the owners of the oil and natural gas in and under the land, by reason of the reservation in the deed from McHenry to Charles Maynard, and were entitled to the oil and gas royalties provided for in the lease executed by them to E. E. Cunningham. Wayne Maynard and the other defendants who trace their title from the deed from John McHenry to Charles Maynard have appealed, and are insisting that the natural gas passed under the McHenry deed and was not reserved. They also claim that they own the oil under the land, although oil is specifically named in the reservation in the McHenry deed. Their argument, in substance, is that natural gas was not known as a mineral having commercial value at the time the deed was executed and that consequently it could not have been the intention of the parties to include it when the word "minerals" was inserted in the deed. As to the oil, it is argued that the parties to the deed intended oil produced or manufactured from coal and not oil produced from oil-bearing sands. Two witnesses were introduced who testified that in 1871, when the deed was executed, natural gas was unknown as a marketable commodity in that community. Evidence to the contrary was introduced, but we think this is beside the point.
The deed is not so ambiguous as to authorize resort to extrinsic evidence as an aid to its construction. The language used clearly imports an intention to convey only the surface rights and to reserve all minerals. In other words, the deed separated the mineral estate from the surface. "The word 'minerals' in a deed embraces oil and gas unless the language of the deed discloses an intention to exclude them." Kentucky West Virginia Gas Co. v Preece, 260 Ky. 601, 86 S.W.2d 163, 165. In Scott v. Laws, 185 Ky.440, 215 S.W.81, 82, 13 A.L.R. 369, the grantor conveyed "all of the mineral right and coal privileges and rights of way to and from said minerals and coal privileges; also the right to search for all undiscovered minerals and coals upon the land hereinafter described." The court said: "Since oil and gas are minerals, and there is nothing in the language of the deed...
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