Pursue Energy Corp. v. Perkins

• Decision Date: 28 February 1990
• Docket Number: No. 07-CA-58744,07-CA-58744
• Citation: 558 So.2d 349
• Court: Mississippi Supreme Court
• Parties: PURSUE ENERGY CORPORATION, Evie Lee Johnson Michael, Mae Willie Michael Burch, Ella Louise Michael Jefferson, Mattie Louise Michael Foote, 3300 Corporation, Grace Petroleum Corporation, Interfirst Bank Dallas, N.A., Continental Illinois National Bank & Trust Co., the Leadership Foundation, Inc., Thomasville, Ltd., Charles S. McClelland, Linda C. McLean, H. Lamar Taylor v. D.L. PERKINS, Mrs. Henry V. Bailey and Mrs. Mable Hammond.

Page 349

558 So.2d 349

PURSUE ENERGY CORPORATION, Evie Lee Johnson Michael, Mae Willie Michael Burch, Ella Louise Michael Jefferson, Mattie Louise Michael Foote, 3300 Corporation, Grace Petroleum Corporation, Interfirst Bank Dallas, N.A., Continental Illinois National Bank & Trust Co., the Leadership Foundation, Inc., Thomasville, Ltd., Charles S. McClelland Linda C. McLean, H. Lamar Taylor v. D.L. PERKINS, Mrs. Henry V. Bailey and Mrs. Mable Hammond.

No. 07-CA-58744.

Supreme Court of Mississippi.

Feb. 28, 1990.

Rehearing Denied April 4, 1990.

Alex A. Alston, Jr., Terryl K. Rushing, Thomas Price Alston Jones & Davis, William R. Presson, Satterfield & Allred, Thomas L. Kirkland, Jr., Kirkland, Barfield & Panter, Jackson, for appellants.

Arthur D. Currie, Jackson, for appellees.

Before ROY NOBLE LEE, C.J., and PRATHER and SULLIVAN, JJ.

PRATHER, Justice, for the Court:

I. INTRODUCTION

This case involves construction of a deed through which a mineral interest was conveyed. The language within the deed's "four corners" was construed by the chancery court as unambiguous, and this Court affirms.

A. The Facts

The parties presented various arguments and legal theories, most of which need not be reproduced in this opinion. In essence, this Court was called upon to construe an allegedly ambiguous deed entitled "Mineral Right and Royalty Transfer." ¹ The deed, executed in 1969 by Jack and Evie Michaels, conveyed to D.L. Perkins an undivided mineral interest:

Grantor ... does grant ... two and one-half/thirty-two and one-half (2.5/32.5) interest in ...

Township 4 North, Range 3 East

Section 34: Commencing at a point 247.5 feet south of the northwest corner of the Northwest Quarter of Southwest Quarter (NW/4 of SW/4), Section 34, Township 4 North, Range 3 East, run thence south 247.5 feet; thence east 1320 feet; thence north 247.5 feet; thence west 1320 feet to point of beginning, containing 7.5 acres, more or less; and,

Twenty five (25) acres off the south end of the Northwest Quarter of Southwest Quarter (NW/4 of SW/4 Section 34, Township 4 North, Range 3 East.

Containing in the aggregate of 32.5 acres.

Notwithstanding anything herein contained to the contrary, it is the specific intent of the grantor to convey and of the grantee to acquire two and one-half (2.5) full mineral acres out of the above described land and grantor does hereby convey and warrant unto grantee two and one-half (2.5) full mineral acres out of the above described lands.

Record at 362 (Perkins subsequently conveyed to his mother, Mable Hammond, and his sister, Mrs. Henry V. Bailey, a portion of his interest). ²

The dispute over the meaning of the deed's language arose after Pursue Energy Corporation [hereinafter Pursue] ³ commenced operation of a natural gas well in an area of Rankin County which includes the 32.5 acres described in Perkins' deed. Id. at 91-135. Prior to paying owners of mineral interests a share of the production proceeds from the extracted gas, Pursue conducted title examinations. These examinations--or more specifically, Pursue's construction of Perkins' deed--led Pursue to conclude that a partial title failure existed. Pursue consequently withheld from Perkins a portion of his share of the proceeds. Id. at 396-97.

B. The Suit

Perkins filed suit in Rankin County Chancery Court seeking release of the withheld proceeds. In his complaint, Perkins contended: (1) that "a contractual duty arose for [Pursue] to pay [him] production [proceeds]" in proportion to his mineral interests "less the cost of development and operation," and (2) that "Pursue ... has breached the duty to pay [him] production [proceeds] less the cost of development and operation." Id. at 3-13. Pursue denied the allegations and asserted numerous affirmative defenses--with only one of which the chancery court concurred. ⁴

Pursue and Perkins both filed motions for summary judgment. Id. at 352-61 & 462. After hearing oral arguments and reviewing briefs filed by both parties, the chancery court ruled in favor of Perkins, and Pursue appealed. Id. at 490-91.

II. ANALYSIS

A. The Parties' Construction of the Deed

In construing the deed, Pursue opines that the "aggregate of 32.5 acres" is essentially two separate but contiguous tracts--one comprising 25 acres and the other 7.5 acres. Pursue contends that the deed conveys to Perkins "an undivided 2.5/32.5 [fractional] interest from each acre in the 25-acre tract ... and also [from each acre in] the 7.5-acre tract." Appellant's Main Brief at 19 (emphasis added). Moreover, at the time when the Michaels conveyed a 2.5/32.5 interest to Perkins, they (the Michaels) owned only a 1.5/32.5 mineral interest in the 25-acre tract. The alleged deficiency of a 1.0/32.5 interest was due to prior conveyances which the Michaels had made to another grantee. Pursue thus credited Perkins with a 1.5/32.5 interest in the 25-acre tract and a full 2.5/32.5 interest in the 7.5-acre tract. Proceeds attributable to the alleged deficiency of a 1.0/32.5 interest in the 25-acre tract were withheld. Record at 396-97.

Perkins disagrees with Pursue's construction of the deed which led to its opinion that a alleged deficiency of a 1.0/32.5 interest and resultant partial title failure exist. Perkins counters that he acquired a full and undivided 2.5 mineral acres out of the aggregate of 32.5 acres. See generally Appellees' Brief at 9-12.

B. Construction of a Contract (Deed) and the Law

As noted in the Introduction of this opinion, this case is one requiring judicial construction of a deed conveying a mineral interest. ⁵ A court confronted with such a case will seek to ascertain and effectuate the parties' intent. Cf. Thornhill, 523 So.2d at 1007 ("I for one am not so nearly interested in what the parties intended as in what they said.") (Robertson, J., concurring in denial of petition for reh'g). A means to this end may entail implementation of a three-tiered process. ⁶

First, the court will attempt to ascertain intent by examining the language contained within the "four corners" of the instrument in dispute. Pfisterer v. Noble & Cities Serv. Oil Co., 320 So.2d 383, 384 (Miss.1975) (Court should ascertain "intent of the parties from [within] the four corners of the instrument") (citing Rogers v. Morgan, 250 Miss. 9, 164 So.2d 480 (1964)); see Thornhill, 523 So.2d at 988 n. 2 ("[I]t is the duty of the Court to construe an instrument as written."); Ewing, Reservations and Exceptions of Minerals in Mississippi Conveyancing, 39 MISS.L.J. 39, 42 (1967) [hereinafter Ewing]; see also Blass & Richey, An Analysis of the Rights and Duties of the Holder of the Executive Right, XLI MISS.L.J. 189, 191 & 191 n. 10 (1970) ("Under this [doctrine], an instrument is construed as a whole, in order to ascertain the intention of the parties.") [hereinafter Blass & Richey].

"[P]articular words ... should not control[; rather,] the entire instrument should be examined." Mounger v. Pittman, 235 Miss. 85, 108 So.2d 565 (1959) (Court referring specifically to a mineral rights transfer); see Harris, 210 So.2d at 633 ("construction should be [based] upon the entire instrument"), overruled in part on other grounds in Thornhill, 523 So.2d at 983; Pfisterer, 320 So.2d at 384 (examine "entire instrument and all words on it"); Welborn v. Henry, 252 So.2d 779, 780 (Miss.1971) ("[I]n construing a deed it is necessary that it be considered as a whole and that the intent of the parties be gathered from its language.") (citing Rogers, 250 Miss. at 9, 164 So.2d at 480; Mounger, 235 Miss. at 85, 108 So.2d at 565; Wolfe v. Wolfe, 207 Miss. 480, 42 So.2d 438 (1949)); Richardson v. Moore, 198 Miss. 741, 22 So.2d 494 (1945) ("[E]ach word and clause ... should be reconciled and given a meaning if that can be reasonably done."); see also Blass & Richey, supra, at 191 & 191 n. 10 ("particular words, phrases, clauses, or sentences in a reservation or deed do not necessarily determine the type of estate created").

This so-called "four corners" doctrine calls for construction through application of "correct English definition and language usage." Thornhill, 523 So.2d at 1007 (Robertson, J., concurring in denial of petition for reh'g); see also Knox v. Shell Western E & P, Inc., 531 So.2d 1181, 1189 (Miss.1988) (Robertson, J., concurring). In other words, an instrument should be construed in a manner "which makes sense to an intelligent layman familiar only with the basics of English language." Id. Of course, exceptions exist (i.e., when a word has a distinctive legal meaning. See id. ("a sentence should not be given an artificial 'diagramed' meaning when its clear idea is reasonably clear") (citing Henderson v. State, 445 So.2d 1364, 1366-68 (Miss.1984)); see also Arrington, 183 So.2d at 825.

When an instrument's substance is determined to be clear or unambiguous, the parties' intent must be effectuated. Pfisterer, 320 So.2d at 384 (instrument that is "clear, definite, explicit, harmonious in all its provisions, and is free from ambiguity" must be "give[n] effect"); see Sumter Lumber Co. v. Skipper, 183 Miss. 595, 184 So. 296, sugg. of error overruled, 183 Miss. 595, 184 So. 835 (1938); 26 C.J.S. Deed Sec. 83 (1956) ("the main object in construing a deed is to ascertain the intention of the parties from the language used and to effectuate such intention").

In cases in which an instrument is not so clear (e.g., different provisions of the instrument seem inconsistent or contradictory), the court will, if possible, harmonize the provisions in accord with the parties' apparent intent. A cursory examination of the provisions may lead one to conclude that the instrument is irreconcilably repugnant; however, this may not be a valid conclusion. See, e.g., Woods v. Sims, 154 Tex. 59, 273 S.W.2d 617 (1955); Wade v. Roberts, 346 P.2d 727 (Okla.1959). If examination solely of the language within the instrument's four corners does not yield a clear understanding of the parties' intent, the...