Lesley v. Veterans Land Board

The Lesleys (plaintiffs) owned a one-half nonexecutive interest in the minerals under a tract of land, while Bluegreen Southwest One (defendant) owned the surface estate and the executive right to lease those minerals. Bluegreen subdivided the land for residential development and imposed a restrictive covenant limiting oil and gas development within the subdivision. The Lesleys sued, arguing Bluegreen breached its duty of fair dealing to them as non-executive mineral-interest holders. The trial court ruled for the Lesleys, but the court of appeals reversed, reasoning Bluegreen couldn't have breached the duty because it never actually exercised the executive right by executing a lease.