## Facts

- Bodcaw Lumber Company conveyed land to Goode by deed but included a clause reserving “all of the gas, oil and minerals and mineral rights in and under said land,” with rights to prospect, exploit, and use sufficient surface.
- Goode later brought a chancery action to cancel the mineral-reservation clause and to quiet title in himself.
- Goode alleged the reservation was only a servitude that had lapsed and argued extinguishment based on nonuse (no exploration), statutes of limitation, laches, and failure to separately assess or pay taxes on the mineral interest.
- The chancery court cancelled the reservation and quieted title for Goode.
- Bodcaw appealed.

## Issues

1. Whether the deed’s mineral “reservation” in the granting clause operated as a valid exception severing and retaining a fee mineral estate in the grantor, rather than creating a mere servitude.
2. Whether a surface owner can acquire a severed mineral estate through lapse of time, nonuse, or limitations where there has been no actual possession of the minerals by drilling or mining under a hostile claim.
3. Whether nonassessment or nonpayment of taxes on the mineral interest extinguishes the severed mineral estate in favor of the surface owner under the circumstances.

## Decision

- The Arkansas Supreme Court reversed the chancery decree.
- The Court construed the deed language as an exception from the grant that validly severed and retained a mineral estate (including oil and gas) in Bodcaw in fee.
- The Court held limitations do not run against a severed mineral estate absent an actual adverse holding that invades the mineral estate (such as drilling or mining under a claim of right).
- The Court rejected extinguishment based on nonuse, laches, and tax-related arguments on this record.
- The case was remanded with directions to dismiss Goode’s complaint for want of equity.

## Legal Principles

- A landowner in fee may convey the surface estate while excepting or reserving all minerals (including oil and gas), thereby creating a separate mineral estate in fee.
- Deeds are construed to effect the grantor’s intent; “reservation” language in the granting clause may be treated as an exception that limits the grant rather than contradicting it.
- After severance, possession of the surface is not adverse to the mineral estate; limitations run against the mineral owner only upon an actual adverse holding that constitutes an invasion of the mineral estate.
- Mere nonuse of a severed mineral estate does not constitute abandonment and does not transfer title to the surface owner.
- Nonassessment or nonpayment of separate mineral taxes, without a legally effective divestiture process shown in the record, does not extinguish a vested severed mineral estate in favor of a private surface owner.

## Conclusion

The court upheld the continued validity of a deed clause reserving all minerals as an exception that severed a fee mineral estate, and it ruled that the surface owner could not obtain that mineral estate through mere passage of time, nonuse, laches, or tax-assessment arguments absent an actual hostile invasion of the mineral estate or other legally effective divestiture.


Bodcaw Lumber Co. v. Goode, 254 S.W. 345 (Ark. 1923)