Landowners Next to Roads Get Big Win

On September 15, 2022, the Colorado Court of Appeals resolved a question that has circulated in the title community in Colorado for years by clarifying that the centerline presumption applies to mineral interests beneath a dedicated right-of-way. Great Northern Properties, LLLP v. Extraction Oil & Gas, Inc., 2022 COA 110, ¶ 1.

The centerline presumption, a common law rule of conveyance, provides that “a conveyance of land abutting a road or highway is presumed to carry title to the center of that roadway to the extent the grantor has an interest therein, unless a contrary intent appears on the face of the conveyance.” Asmussen v. U.S., 304 P.3d 552, 553 (Colo. 2013). No reported case in Colorado had, however, addressed whether this general rule included the mineral interests beneath the road as well. In Great Northern, the Court of Appeals clarified that, when the centerline presumption applies, it applies to convey all interests a grantor possesses in the property underlying a right-of-way, including mineral interests. Great Northern, ¶ 2.

The case concerned a parcel of land in Greeley, Colorado that a developer subdivided and dedicated a right-of-way for a road across in 1974. Id. at ¶¶ 4-5. Subsequently, the developer conveyed all the land abutting the road to three different grantees. Id. at ¶ 6-7. None of the deeds reserved any mineral interests to the developer, and all three deeds described the land adjacent to the road conveyed thereby by metes and bounds. Id. The last deed, but not the first two, contained a reference to the road. Id.

The Court of Appeals held that, although the precise question before it was novel, the answer is dictated by “well-settled principles of property law” that lead to the conclusion that when the centerline presumption applies, it applies to all interests the grantor possesses in the property underlying the right-of-way. Id. at ¶ 13 (emphasis added). Citing Asmussen and Enerwest, Inc. v. Dyco Petroleum Corp., 716 P.2d 1130 (Colo. App. 1986), the Court of Appeals emphasized that the centerline presumption presumes that a grantor intends to convey, along with the property, all its appurtenant advantages and rights and that a grantor conveying property by deed intends to convey its entire interest unless a portion of that interest is expressly excepted from the conveyance. Id. at ¶ 15. It is also well established that “a conveyance of land by general description, without any reservation of a mineral interest, passes title to both the land and the underlying mineral deposits.” Id. at ¶ 16 (quoting O’Brien v. Vill. Land Co., 794 P.2d 246, 249 (Colo. 1990)). Thus, the rule is that “when a grantor conveys property abutting a right-of-way by deed without express reservation of the mineral estate, it is presumed that (1) the grantor intends to convey the highest estate owned to the centerline of the right-of-way, and (2) the highest estate includes both the surface and the unsevered mineral estate.” Id. at ¶ 17.
Finally, the Court of Appeals affirmed that all of the Asmussen criteria for when the centerline presumption applies had been satisfied by the parties who appeared. Id. at ¶¶ 19-23. The Court of Appeals therefore affirmed the trial court’s judgment that applied the centerline presumption to hold that the abutting landowners owned the mineral interests underneath the road, but it remanded for the trial court to dismiss this quiet title action with respect to the interests owned by non-appearing parties as the court should not have quieted title to their interests. Id. at ¶¶ 56-57.

Ultimately, the outcome of Great Northern benefits those who own land abutting a road. Landowners conveying property that abuts a road must expressly reserve the minerals interests if that is their intention. Otherwise, a grantee will take possession of the mineral interests underneath the property and underneath the abutting road. This outcome is certainly noteworthy for title attorneys, but it is also important for state and local governments, oil and gas operators, and other owners who may be under the impression that they hold an interest in the minerals under a right-of-way.