Moroney v. St. John Missionary Baptist Church, Inc.

• Decision Date: 04 November 2021
• Docket Number: NO. 14-20-00203-CV,14-20-00203-CV
• Parties: Linda MORONEY, Appellant v. ST. JOHN MISSIONARY BAPTIST CHURCH, INC., aka St. John Missionary Baptist Church, as Successor and Assignee of St. John Colored Baptist Church, Appellee
• Court: Texas Court of Appeals

636 S.W.3d 698

Linda MORONEY, Appellant

v.ST. JOHN MISSIONARY BAPTIST CHURCH, INC., aka St. John Missionary Baptist Church, as Successor and Assignee of St. John Colored Baptist Church, Appellee

NO. 14-20-00203-CV

Court of Appeals of Texas, Houston (14th Dist.).

Opinion filed November 4, 2021

Rehearing Denied January 27, 2022

Iain Gordon Simpson, Houston, for Appellant.

Wayne H. Paris, Claude Smalling III, Houston, for Appellee.

Panel consists of Justices Wise, Bourliot, and Zimmerer.

Ken Wise, Justice This case involves competing requests for declarations concerning the interpretation of a deed in which the grantor conveyed to the grantee a possessory estate while retaining a reversionary interest. We hold that the trial court erred by declaring that the grantor's interest terminated upon his death. Thus, we reverse the trial court's judgment and render a judgment declaring that the heirs of the grantor hold a reversionary interest in the property.

I. BACKGROUND

The trial court held a bench trial during which the court admitted documentary exhibits without objection and heard arguments of counsel. The parties agree that there were no fact issues to be resolved because this case turns on the interpretation of an unambiguous deed.

In 1935, George Dew conveyed to the St. John Colored Baptist Church a two-acre tract of land in Fort Bend County. The deed provides:

It is the intention and purpose of the grantor herein to convey the surface rights in the above described land to said religious organization and its successors, for use as a church premises and for such religious purposes, with the understanding and agreement that if said premises are not used for said purposes, or if used and thereafter abandoned for religious purposes, then said premises herein granted are to revert to the grantor.

To have and to hold said premises as above described unto said religious organization and its successors and assigns, for use only as a church premises and for religious purposes so long as said premises are used for said purposes, subject to the condition that said premises herein granted shall in the event said premises are not used for said purposes, or should they be used for religious purposes and thereafter abandoned for said purposes, then said premises are to revert to the grantor.

Dew died a few weeks later. Appellant Linda Moroney is one of Dew's heirs. Appellee St. John Missionary Baptist Church, Inc. is a successor of the grantee (collectively, the Church). It is undisputed that the Church has not breached the condition subsequent.

The Church sued Moroney and Dew's other heirs to quiet title and for a declaration that Dew's reversionary interest terminated upon his death. The Church alleged, and the court found, that donors and investors were denying the Church financial assistance to expand "because it is believed that Defendant Moroney may have some future nonpossessory vested interest in the Plaintiff's property." Moroney counterclaimed for a declaratory judgment that she is "a holder of a reversionary interest under the terms of the Deed."

The trial court signed findings of fact and conclusions of law. In relevant part, the court found and concluded that:

• Dew conveyed to the Church "a fee simple surface estate, subject to a condition subsequent" and not a "fee simple determinable with possibility of reverter";

• Any right of entry for breach of the condition subsequent "was solely for the life of [Dew] and terminated upon his death on December 28, 1935, and therefore the condition subsequent is now invalid and unenforceable";

• "[I]f the forgoing finding is in any way erroneous and the right to re-enter under the condition subsequent was not terminated by the death of [Dew], that same has expired based upon the adverse possession limitation statutes or based upon the expiration of a reasonable length of time"; and

• Reasonable and necessary attorney's fees incurred by the Church for $82,912 were equitable and just and not in need of segregation.

The trial court signed a final judgment consistent with these findings, declaring among other things that Moroney and Dew's other heirs have no future interest in the property. Moroney appeals.

II. ANALYSIS

In her first two issues, Moroney contends that the trial court erred by concluding that Dew's interest was a right of entry rather than a possibility of reverter and that Moroney's interest was invalid because the phrase "and his heirs" was not included in the portion of the deed stating that the property would "revert to the grantor." Within these issues, Moroney also contends that her interest did not lapse due to a statute of limitations, laches, or other waiver. In her third issue, Moroney challenges the trial court's award of attorney's fees to the Church.

We hold that Dew's interest was a right of entry, but we agree with Moroney that this right was not limited to Dew's life under the terms of the deed. No evidence supports the Church's claim based on limitations, laches, or waiver. And, attorney's fees are unavailable because the Church's action is one to quiet title. Thus, the trial court's contrary declarations and the award of attorney's fees must be reversed and a judgment rendered declaring that Moroney and Dew's other heirs hold a reversionary interest in the property.

A. Standard of Review

The parties agree that we should review de novo the trial court's determination of the validity of Dew's interest in the property. The construction of an unambiguous deed is a question of law for the court. Wenske v. Ealy , 521 S.W.3d 791, 794 (Tex. 2017). Our duty is to ascertain the intent of the parties from all the language within the four corners of the deed. Id. Although we give deference to a trial court's resolution of disputed facts, when there are none, as here, our review is de novo. LaLonde v. Gosnell , 593 S.W.3d 212, 220 (Tex. 2019).

B. Possibility of Reverter vs. Right of Entry

The parties join issue on whether Dew's reversionary interest in the property was a "possibility of reverter" or "right of entry"—the latter also known as a "power of termination." The historical distinction between the two types of reversionary interests is that a possibility of reverter is said to transfer possession of the property automatically to the holder of the reversionary interest upon satisfaction of a condition, while a right of entry requires some action on behalf of the holder of the interest to take possession of the property after the condition is broken. See Lawyers Trust Co. v. City of Houston , 359 S.W.2d 887, 890 (Tex. 1962) ; Singer v. State , 391 S.W.3d 627, 632–33 (Tex. App.—El Paso 2012, no pet.) ; see also Restatement (Third) of Property: Wills and Other Donative Transfers § 25.2 cmt. d; 1 Simes and Smith, The Law of Future Interests § 241, Westlaw LFUTINT (3d ed., database updated Jan. 2021).

Although the distinction often makes no difference, see generally El Dorado Land Co., L.P. v. City of McKinney , 395 S.W.3d 798, 803 (Tex. 2013) ; Restatement (Third) of Property § 25.2 cmt. d, the parties devote substantial briefing to the issue. We agree with the trial court and the Church that Dew's interest was a right of entry rather than a possibility of reverter.

The parties agree that the deed uses language that has been associated with creating either a possibility of reverter or a right of entry. Language such as "so long as" and "revert" may indicate a possibility of reverter while language such as "subject to the condition" may indicate a right of entry. See Singer , 391 S.W.3d at 632–33 & n.2. When there is doubt which type of interest was intended, the doubt must be resolved in favor of a right of entry as it is "in a sense less onerous upon the grantee in that, under such a construction, the estate does not terminate automatically with the occurrence of the stated contingency, but only after re-entry or its equivalent is made by the grantor." Lawyers Trust , 359 S.W.2d at 890.

Accordingly, we resolve any doubt in the Church's favor and hold that Dew retained a right of entry rather than a possibility of reverter under the deed. See Singer , 391 S.W.3d at 633 (holding that when language indicative of both interests is used, then the doubt would be resolved in favor of a condition subsequent, despite language that the property would "revert to and be revested" in the grantor; citing cases).

C. Not Limited to the Life of Dew

The central issue in this case is whether the deed, by referring to the reversion of the property "to the grantor" rather than "to the grantor and his heirs," had the effect of limiting the term of the condition to Dew's life. The parties agree that a right of entry is a future interest in property that may be devised under Texas law. See, e.g., James v. Dalhart Consol. Indep. Sch. Dist. , 254 S.W.2d 826, 829 (Tex. App.—Amarillo 1952, writ ref'd) ; Watts v. City of Houston , 196 S.W.2d 553, 556 (Tex. App.—Galveston 1946, writ ref'd) ; see also El Dorado Land Co. , 395 S.W.3d at 803 (noting that both possibility of reverter and right of entry are future interests in real property that are freely assignable like other property interests).¹ Moroney contends that because a right of entry is a future interest that may be inherited, and no special words of inheritance are required to convey a fee simple estate, see Tex. Prop. Code § 5.001, the right of entry would pass to Dew's heirs although the deed did not refer to them specifically.

The Church points to the case of Daggett v. City of Fort Worth , which states: "It is familiar that, unless the heir is named, he cannot re-enter, though the condition is breached; the estate does not inure to his benefit." 177 S.W. 222, 223 (Tex. App.—Amarillo 1915, no writ). The court of appeals provided no explanation or rationale for this principle, cited no authority to support it, and did not apply it because it was dicta—the party seeking to exercise the right was the grantor, see id. at 222, and the resolution of ...