After a trial on the merits to determine the ownership of mineral rights as between the probate estates of a mother and son, the Court concluded that the disputed mineral rights are owned by the probate estate of the son.  In a 1996 deed, stating no reservations or exceptions of any mineral interests, Hipolito Franco’s parents conveyed 122 acres of property to him.  In 1998 Hipolito and his wife used the surface estate of property as collateral for a loan.  A survey of the property revealed an error in the metes and bounds description of the property in the 1996 deed.  The lender’s title commitment required a correction deed, which Hipolito’s mother (then widowed) signed.  The metes and bounds description in the correction deed was preceded by the phrase “surface estate only.” Relying on the “surface estate only” language in the correction deed and on other legally-ineffective documentation, Hipolito’s mother claimed ownership of the mineral rights for several years, while omitting them from her bankruptcy schedules in two chapter 7 cases.  A state court quiet title action pertaining to the mineral rights filed by Hipolito and his wife was removed to this court.  By the time a trial on the merits of ownership of the disputed mineral rights was held, Hipolito and his mother had died.  The Court held that the disputed mineral rights were conveyed to Hipolito in the 1996 deed.  The correction deed did not alter the nature of that conveyance.  Hipolito’s estate was not estopped from claiming ownership of the disputed minerals.  Principles of estoppel by deed and judicial estoppel would preclude his mother’s estate from claiming ownership of the disputed minerals.          

Debtor moved for the avoidance of a judicial lien encumbering his property. The Court ruled that on the petition date, Debtor’s house was worth less than the New Mexico homestead exemption, so the lien could be avoided entirely. Further, it would be a violation of the New Mexico Rules of Professional Conduct for the lienholder, Debtor’s former attorney, to collect the judgment, as it was an unreasonable fee consisting primarily of accrued interest.

Plaintiff sued Defendant for declaration that damages resulting from Defendant’s clouding of Plaintiff’s title, liquidated in a California state court default judgment, were nondischargeable under §§ 523(a)(2), (4), or (6). The Court did not determine the default judgment nondischargeable, but instead found and concluded that Defendant’s actions were willful and malicious, and that actual proved damages and $25,000 in punitive damages were therefore nondischargeable under § 523(a)(6).

Defendants moved for partial summary judgment on Plaintiffs’ claim that Defendants were professionally negligent for failing to disclose to Plaintiffs a mortgage clouding title in a real estate transaction. The Court granted Defendants motion, holding that Plaintiffs were aware of the mortgage prior to closing and that Defendants’ nondisclosure of the mortgage was not the proximate cause of any damages Plaintiffs may have incurred.