The after acquired title doctrine states that if a grantor purports to convey ownership of real property to which he does not have legal title at the time of the conveyance, but later acquires that title, it automatically vests in the grantee. The doctrine of after acquired title stretches back over a century in Texas real property law. Since it was first established, courts have expanded, limited, or clarified the doctrine as it applies to various property concerns like conveyances, mortgages, deeds of trust, real property liens, oil and gas matters, and more.
The After Acquired Title Doctrine, Explained
The concept behind the doctrine is simpler than the name implies. It does not allow a party to benefit from selling a property they do not own should they later acquire title. The rule estops the grantor from claiming ownership of the after acquired interest against the grantee. The effect of the doctrine is also binding on any of the grantor’s successors and subsequent purchasers alike. Hardy v. Bennefield, 368 S.W. 3d 643 (Tex.App.-Tyler 2012, no pet).
Exceptions to the Doctrine
While widely applicable as a form of equitable relief, there are some limitations to the doctrine.
Limited to the estate conveyed
Courts apply the doctrine to specific estates only. That means it does not apply to a reserved estate, to an excepted interest, or to an interest not conveyed. The grantee receives the intended estate and nothing more. Talley v. Howsley, 142 Tex. 81, 176 S.W.2d 269, 273-274 (Tex.Civ.App-Fort Worth 1956, writ ref’d n.r.e.).
Limited application to oil and gas leases
Courts do not apply the doctrine should a lessor acquire an additional mineral interest after executing an oil, gas and/or mineral lease. Standard lease language usually purports to cover the entire mineral estate, even though the parties know that the lessor only owns an undivided interest in the land. This exception makes certain that no fractional mineral interest is left outstanding. McMahon v. Christmann, 157 Tex. 403, 303 S.W.2d 341 (1957).
Public Lands
An attempted conveyance of public land by private individuals also does not apply. The courts consider these conveyances to be against public policy. Any title to any after acquired interest in the land will be void. In addition, any public lands conveyed by the state to a private individual that later become the subject of boundary disputes are not subject to the doctrine. Lamb v. James, 87 Tex. 485, 29 S.W. 647, 649 (1895).
Title Acquired by Trust
Texas courts also refuse to apply the doctrine to interests held in a trust for a third party, because the grantee is not entitled to claim greater rights than his grantor under subsequent title. The grantor may have legal title to the property but has no beneficial rights in it. Thus, they have nothing to convey to the grantee.
Not Applied to Quitclaims
A quitclaim is a deed of conveyance that intends to pass any claim or interest the grantor has to the grantee. But unlike other deeds, a quitclaim makes no warranties that the title they are passing is valid. The recorded quitclaim puts subsequent purchasers on notice of potential claims and defects. Clark v. Gauntt, 138 Tex. 558, 161 S.W.2d 270, 273 (1942).
Conclusion
Knowing whether the after acquired title doctrine or one of its exceptions applies to a transfer is complicated and often takes the expert eye of a real estate attorney. If you run into this situation, be sure to consult with an attorney before taking any additional steps.
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