"or" lease

In 1937, A.B. Crosby executed a mineral deed conveying an interest in Survey Sixty-four in Zapata County to Southland Lease and Royalty Corporation. The granting clause specified an undivided one-ninety sixth (1/96) interest in the oil, gas, and other minerals in and under the land, together with rights of ingress and egress for prospecting and drilling. A subsequent clause stated that the conveyance was made subject to the terms of any valid subsisting oil, gas and/or mineral lease or leases. It covered and included one-twelfth (1/12) of all rentals and royalty of every kind and character payable under such lease or leases. The day before executing this deed, Crosby had acquired an undivided 1/12 interest in the same minerals through an identical deed except that its granting clause used the fraction one-twelfth (1/12). At the time each deed was executed, an oil and gas lease providing for a 1/8 royalty was outstanding on the property. That lease expired before any of the parties to this case entered into new leases covering the survey. Crenshaw Royalty Corporation later acquired Southland's interest under the 1937 deed and executed two oil and gas leases under which Concord Oil Company became the lessee. In 1961, Crosby executed another mineral deed conveying an undivided 7/96 interest in the minerals under Survey Sixty-four to John M. Robinson. Robinson subsequently entered into an oil and gas lease with Pennzoil Producing Company. Through a series of transactions, Pennzoil Exploration and Production Company succeeded to interests under that lease, and Sanchez O'Brien Oil & Gas Corporation acquired a 25% interest in the lease. Pennzoil completed producing wells on the property, after which Concord sought a determination of its interest and sued for damages equal to the value of past production. Pennzoil counterclaimed seeking a determination of its rights. The case was tried to the court on stipulated facts. Concord's primary contention was that the 1937 deed unambiguously conveyed a 1/12 interest in the minerals. Pennzoil contended that the deed conveyed only a 1/96 interest in the minerals together with a 1/12 interest in rentals and royalty limited to the lease existing at the time of the grant. The trial court found in favor of Pennzoil and entered a take-nothing judgment against Concord. The court of appeals affirmed. The Supreme Court of Texas granted review, and after granting rehearing and withdrawing its initial opinion, the Court issued its decision on February 26, 1998.