The Texas Supreme Court has agreed to review a Fort Worth Court of Appeals’ decision dismissing a dispute concerning the ownership of West Virginia mineral interests.
Robert Scott Bauer and Braxton Minerals II, LLC v. Braxton Minerals III, LLC (No. 24-0438; granted June 13, 2025) arose from a dispute over mineral interests located in West Virginia. Braxton III (B3) sued Braxton II (B2) and Bauer in a Tarrant County district court alleging fraud and fraudulent inducement, unjust enrichment, constructive trust, and money had and received. It sought reformation of title to the disputed deeds to show B3’s ownership, specific performance to transfer and assign the disputed interests and royalties to B3, a declaration that BM3 is the rightful owner of the interests, and attorney’s fees. Defendants counterclaimed, alleging fraud and wrongful taking of the West Virginia mineral interests and royalty payments, unjust enrichment, money had and received, and attorney’s fees. The trial court granted summary judgment for B3 on its claims for affirmative relief, denied Defendants’ motion for summary judgment, and awarded B3 attorney’s fees. Defendants appealed.
In an opinion by Justice Wallach, the court of appeals reversed and remanded. Defendants argued that the trial court lacked subject matter jurisdiction, though they didn’t brief it. Still, since they brought it up, the court had to consider it before moving on to Defendants’ other nine issues. Beginning with “the basic principle that Texas courts have no jurisdiction to adjudicate title to real property in other jurisdictions” (citations omitted), the court acknowledged that “if a Texas court has jurisdiction over the parties, it may enforce a party’s personal or contractual obligation that indirectly involves property in another state” (citations omitted). Looking to pleadings for “the nature of the suit, the injury complained of, and the relief sought, together with any relevant evidence,” the court set out to determine whether “the gist or gravamen of the claim involves adjudication of title to foreign real property interests” (citation omitted). If such ownership “is more than incidental or collateral to the claims and measure of recovery, then the court lacks jurisdiction.”
Likening this case to one involving a dispute over title to Kentucky mineral interests, Danish Leasegroup, Inc. v. York Oil & Gas Mgmt, Inc., 362 S.W.3d 220 (Tex. App.—Dallas, 2021, no pet.), the court observed that B3 alleged that Defendants “had represented, and entered into an agreement, that BM2 would transfer title to mineral interests it owned in West Virginia, which interests were subject to producing oil and gas owned by Antero Resources.” B2 further failed to notify Antero of the transfer, which resulted in B3 losing the royalty payments. B3 sought equitable remedies, as well, including specific performance, reformation of the deed, and injunctive relief. Consequently, the court concluded, “not only the gist, but the core, of BM3’s allegations revolve around its claim of ownership of the mineral interests in question ….”
The court then parsed a Houston court of appeals decision, Devon Energy Prod. Co. v. KCS Res., LLC, 450 S.W.3d 203 (Tex. App.—Houston [14th Dist.] 2014 pet. denied), holding that Texas courts had no jurisdiction over a dispute to declare title to Louisiana mineral interests, despite Devon framing the case as a declaratory judgment action to declare rights under a purchase and sale agreement rather than the title deed. Similarly, in this case B3 asserted that a Texas trial court has jurisdiction in a declaratory judgment action “regarding parties’ obligations to one another.” But, as the court pointed out, it sought adjudication of title, reformation of title, and specific performance under cover of a declaratory judgment. The court concluded that the trial court did not have subject matter jurisdiction and dismissed the case.
Defendants, however, also counterclaimed for fraud and damages caused thereby. So did the trial court have jurisdiction over the counterclaim? Again, neither party briefed the issue, so the court was left to do the work itself. Not finding much authority on the question of fraud actions for damages arising from a foreign real estate transaction, the court looked to the mandatory venue statute (§ 15.011, CPRC) instead. The statute prescribes venue in actions for recovery of an estate or interest in property, or for recovery of damages to real property, in the county where the property is located. Again, mandatory venue “may not be evaded by artful pleading,” but must be determined by the nature of the dispute. Since the court had previously determined the nature of this dispute in its jurisdictional analysis, the same applied here. “For [Defendants] to succeed on their damage counterclaim,” Justice Wallach wrote, “they must prove their rightful ownership to the mineral rights. Thus, [Defendants’] suit is one that requires the trial court to determine ownership of real property interests in a foreign jurisdiction, which is forboden” (citations omitted). Consequently, the trial court didn’t have jurisdiction over Defendants’ counterclaim, either.
SCOTX has not yet scheduled oral argument.
