Most mineral deeds have some language to the effect of:
Grantor does hereby bind Grantor, Grantor’s heirs, successors, assigns, executors and administrators to warrant and forever defend title to Grantee against every person whomsoever lawfully claiming or to claim the same or any part thereof, when the claim is by, through, or under Grantor but not otherwise.
This legal soup is called the warranty clause. It defines what obligations the grantor (seller) has to the grantee (buyer) if there’s an issue with title discovered after the transaction is complete.
Warranty clauses come in three basic varieties:
- General warranty, sometimes titled a warranty deed;
- Special warranty, sometimes titled a special warranty deed; and
- Quitclaim (no warranty), sometimes titled a quitclaim deed.
These different warranty types define different obligations the grantor (seller) owes to the grantee (buyer).
In a warranty deed, the grantor (seller) guarantees good title to the grantee (buyer). If there’s an issue, it’s the grantor’s responsibility to make the buyer whole. The general warranty clause in a warranty deed will read something like:
Grantor does hereby bind Grantor, Grantor’s heirs, successors, assigns, executors and administrators to warrant and forever defend title to Grantee against every person whomsoever lawfully claiming or to claim the same or any part thereof.
Notice that the Grantor is obligated to “warrant and forever defend” title against any other person who claims to have an interest in title, regardless of when the problem arose. It’s a “general” warranty in the sense that there are no limits or exceptions.
An example might help. Let’s say Peter Prior acquired a mineral interest in 1952. The mineral interest is a 100% ownership in 40 acres in Midland, Texas. In 1964, Peter Prior conveyed 50% of that mineral interest to his friend Cary Claimant. Now, Peter and Cary both own 50% of the 40 acres. But the deed was misfiled by the Midland County Clerk and doesn’t show up in normal searches. Then in 1990, Peter Prior dies, conveying the rest of the mineral interest to his cousin Greg Grantor.
In 2022, Greg Grantor decides to sell the minerals to Big Time Buyer. As far as Greg Grantor and Big Time Buyer know, Greg owns 100% of those 40 acres. And so when Greg Grantor conveys the interest with a warranty deed, he is warranting 100% of those 40 acres. A couple years later, the deed from Peter Prior to Cary Claimant arises, and suddenly there’s a title dispute!
Because Greg Grantor executed a warranty deed, Greg Grantor is responsible for title, and therefore, responsible for making Big Time Buyer whole. Obviously, Greg Grantor isn’t in a great position. He didn’t realize he only owned half, and now he’s responsible for making up the difference.
Special Warranty Deed
Because of this, many sellers will only give special warranties. Special warranties read like general warranties, except they typically include language like:
when the claim is by, through, or under Grantor but not otherwise.
More legal soup! But the key phrase is “by, through, and under Grantor but not otherwise.” In this case, the grantor (seller) warrants title, but only as to their own actions. So Greg Grantor is responsible for a title issue that Greg himself created (“by, through, and under Grantor…”). But if there is a title issue arising from a prior owner, like Peter Prior, then that’s not Greg’s problem (“…but not otherwise.”)
The basic idea is that the grantor (seller) only knows for sure what they themselves have done. So they only want to warrant title as to their own actions. If there’s another problem, then it’s up to the grantee (buyer) to figure it out in the title process.
Quitclaim deeds are deeds without warranty. They don’t make any claims as to what the grantor owns, and they don’t promise to do anything if there’s a title bust.
Typical quitclaim language might read something like:
Grantor quit claims to Grantee all of Grantor’s right, title, and interest in and to the Property. Neither Grantor nor Grantor’s heirs, successors, or assigns will have, claim, or demand any right or title to the Property or any part of it.
Quitclaim deeds don’t include a warranty clause. But if there were a warranty clause, it would in essence say something like:
Grantor doesn’t know what they own and makes no warranty about it. Maybe they already sold it. Maybe they never acquired it in the first place. But if Grantor does own anything, they transfer it to Grantee.
Quitclaim deeds are typically used to disclaim any interest in property when the ownership is in doubt, as a way to clean up title. “I don’t own this property, but if I do own anything, I convey it to Bob.” In essence (don’t quote our etymology here), the grantor is “quitting their claim” to any interest in the property.
As between general and special warranties, most mineral buyers should be fine with either. A buyer might insist on a general warranty in extraordinary circumstances, but in most cases it just doesn’t matter that much.
However a quitclaim deed is not used in a typical mineral transaction. If a grantor (seller) wants to execute a quitclaim deed, it’s because they’re refusing to make any warranty as to what they themselves have done. If a grantor (seller) isn’t willing to warrant that they haven’t already sold the property, that is (or should be!) a red-flag that will usually kill the transaction.