Page:Arrington v. United Royalty Co.pdf/7

276 interest in real estate, at page 180, referring to the Texas cases holding to the contrary, it is said: "In Texas, notwithstanding that the royalty is treated as rents and not purchase price, several decisions by commissioners and the courts of civil appeals have treated the royalty as personal property. The position is indefensible in view of the fact that the lease is held to be a fee because of indefinite duration. The royalty has the same theoretical duration as the lease. It would seem that in Texas, where the lessor is held to have no reversion, the courts will ultimately recognize the royalty as a ground rent reserved in fee."

In the case of Green v. Biddle, 8 Wheat. 76, the following statement is found: "We are clearly of the opinion that the grant of one-half of the royalties, rents and income from the oil is a grant of one-half of the oil in place." This rule seems to have been in the mind of the court in its holding in the case of Allen v. Thompson, supra, and we now announce the rule to be that royalties in gas or oil, until brought to the surface and reduced to possession, are interests in real estate and not personal property.

It seems to have been conceded that the interest in the royalty acquired by Dan W. Johnson by virtue of the conveyance from J. R. Hudson, the owner of the land, was an interest in land, but the contention is made that, when Johnson conveyed to appellee one-half of his interest in the oil and gas royalties, the character of the property conveyed became changed from an interest in real estate to personal property. We can see no just reason for this contention. The language in the granting clause of the instrument named "royalty conveyance" from Johnson and wife to the appellee is as follows: "Do hereby bargain, sell, grant, convey, transfer, assign and set over to the second party (appellee), his heirs and assigns, an undivided one-half interest in and to the oil and gas royalty, which is, or may hereafter be, reserved by said party of the first part (exclusive of the oil and gas bonus and oil and gas rental money) in and under the following described property." This was effective to convey to the grantee precisely the same character of estate as was in