Texas Business Court Distinguishes Conditional Assignment from Agreement to Transfer in Eagle Ford Farmout Dispute

In a McMullen County Eagle Ford farmout dispute, the Business Court of Texas addressed whether a 2009 farmout agreement constituted a conditional assignment vesting immediate interest in the farmees subject to divestment, or merely an agreement to transfer requiring prerequisite performance. The court's partial summary judgment ruling turned on whether defendants' alleged failure to properly designate earned acreage within contractual deadlines would trigger automatic reversion of the leases to the farmors.