16 Oct Fractional Interest vs. Mineral Acres… by Kyle Williams

How to treat a grant of a fractional mineral interest when it conflicts with a statement of specified mineral acres in North Dakota

When examining title in North Dakota, it is not uncommon to review a deed that conveys an undivided fractional mineral interest in a tract which also includes a statement of the specific number of mineral acres covered by the conveyance. Occasionally, the recited mineral acre total does not agree with the stated fraction.

For example, consider a deed in North Dakota, a state who utilizes the Public Land Survey System (PLSS) which generally sets out 640-acre square sections. Such deed conveys a one-half (1/2) mineral interest in a specific section, and additionally includes a statement specifying such conveyed interest as being 320 mineral acres. In a regular 640-acre section, if a deed grants both the one-half (1/2) fractional interest and states that its intent is to convey 320 mineral acres, such a conveyance is clear and has no conflict.

640-Acre Sections & PLSS Survey Lines

However, many sections in North Dakota are not regular 640-acre sections due to imperfections in the PLSS survey lines. These lines are intended to follow true parallels and meridians but mathematically converge toward the North Pole, requiring periodic adjustments. As a result, there are slight variations in the size and shape of townships and sections to maintain the PLSS’s regular pattern. In such irregular sections, the result is the creation of lots along the north and west sides of such townships and sections which will include slightly more or less than 40 acres per lot and result in a section with slightly more or less than 640 acres. In such cases, for example, in an irregular section that comprises 651.25 acres, the same deed that conveys both a one-half (1/2) interest in the section, and includes a statement of intent of conveying 320 mineral acres, now is in conflict with itself, since one-half (1/2) of a 651.25 acre section equals 325.625 mineral acres, and not 320. 

This specific circumstance has not been addressed directly by The North Dakota Supreme Court; however, guidance for title examiners can be found in Hild v. Johnson, 2006 ND 217, 723 N.W.2d 389, whose reasoning was affirmed in Lario Oil & Gas Co. v. EOG Resources, Inc., 2013 ND 98, 832 N.W.2d 49. In Hild, the Court held that a grant of an undivided mineral interest expressed as a fraction conveys that quantum in the entire described tract, regardless of actual acreage, and that when a deed contains a discrepancy between a specific description and a quantity statement, the specific description controls.

Based on this guidance, applying this reasoning to the example above  a title examiner could make an assumption that the parties intended to convey a one-half (1/2) interest in the entire 651.25 acre section (or 325.625 mineral acres) despite its recital of conveying 320 mineral acres, since the courts have favored specific property descriptions over quantity statements. In the instance of such a conflict and cloud on title, North Dakota Mineral Title Standard 3-02.2 advises the examiner to require the parties (or their successors) to execute a stipulation or seek judicial determination. Alternatively, a more recent conflicting conveyance could also be remedied with a corrected deed executed by both parties, clarifying  their intent.  

Written by Kyle Williams, Senior Attorney at KMD Law

References:

Hild v. Johnson, 2006 ND 217, 723 N.W.2d 389

Lario Oil & Gas Co. v. EOG Resources, Inc., 2013 ND 98

North Dakota Mineral Title Standard 3-02.2