Replies to This Discussion

Permalink Reply by Skip Peel - Mineral Consultant on August 5, 2013 at 11:41

Where is the mineral interest located?  Section-township-range.

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Permalink Reply by B Demery on August 6, 2013 at 10:49

  Why?   Can you help?

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Permalink Reply by Skip Peel - Mineral Consultant on August 6, 2013 at 13:00

If the well is a unit well there is a list of those who owned minerals at the time the unit was formed.  See my reply below.  Suggest that you follow up with Dion.  He is well qualified to answer your questions and point you in the right direction.  The list of ownership interests is probably too out of date to be of use considering that the well was drilled in 1980.

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Permalink Reply by 1kw6x71km1v37 on August 5, 2013 at 14:45

The operator doesn't know who he paying royalty on a well to. That's a good one.

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Permalink Reply by Skip Peel - Mineral Consultant on August 6, 2013 at 1:57

It is possible that there are leases held by Working Interests in the well and that they pay their lessors as opposed to the operator.  Whatever the specific situation, lessees do not give out information on their lessors owing to privacy policies.  The only public source of ownership interests within a drilling unit, if this is a unitized well, is the Interested Party list filed with the unit application and on file at the Office of Conservation district office.  That list contains mailing addresses which were used to send notice to the mineral and surface interests within the unit boundary and adjacent to a distance of 1000'.

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Permalink Reply by 1kw6x71km1v37 on August 6, 2013 at 5:35

Was your grandfather's estate probated and was there a succession of his interests? That is your starting point.

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Permalink Reply by B Demery on August 6, 2013 at 10:29

Don't think his estate was probated... No succession was done.  Taxes are still being paid on behalf of his name only... Yet the oil company says there are many more names than just his grandchildren and great grandchildren.... probably more than 100... seems to be a convulated mess.   They suggested we hire an abstractor.

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Permalink Reply by Dion Warr, CPL on August 6, 2013 at 9:06

B Demery:

Who leased the property initially?  Your grandfather?  You?  Someone in between?

 

It is quite possible that if your grandfather leased the property and only certain relatives have sent in information via Affidavits of Death and Heirship that some of you (apparently you would be one of these, as you are receiving royalties) are up to date in their system while others are "Heirs of {So and So}" being held in suspense (somebody died, check was returned, the company noted such and placed the interest in suspense).

 

The most natural question would be "Why doesn't the oil company know who all needs to be paid / ownership has changed?".  The answer is usually quite simple.  Most preprinted lease forms contain a provision that requires any successor interest in a leased property (whether by succession, purchase, or otherwise) to notify lessee in writing and/or provide a recorded or recordable act which vests ownership into the successor owner.  The lessee is not responsible for divining who subsequent owners are (or should be) in a lease once said lease is brought into production, nor are they compelled to engage in such title research.  Further, as to actions (or inaction) by Lessee re: changes to the ownership are not the responsibility of Lessee and are not binding to the Lessee until they have received evidence of such transfer(s).  Therefore, proving up Lessor's successor interest is the successor's burden, not that of the Lessee.

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Permalink Reply by B Demery on August 6, 2013 at 11:02

 <Who leased the property initially?  Your grandfather?  You?  Someone in between?>>>

Don't know.   He died in 1962. Well spudded in 1980. Still producing. Only 5 of his 10 children were alive at the time.  My mom got a small signon bonus(about 3,000.) and subsequent royalty checks.  Initially it was Crystal Oil, which went bankrupt.  Has changed hands about 3 times since then. I did an affidavid for my siblings and myself when my mom died.

<It is quite possible that if your grandfather leased the property and only certain relatives have sent in information via Affidavits of Death and Heirship that some of you (apparently you would be one of these, as you are receiving royalties) are up to date in their system while others are "Heirs of {So and So}" being held in suspense (somebody died, check was returned, the company noted such and placed the interest in suspense).>>>

Thera ARE some unclaimed funds for immediate relatives, which I am working on getting for us.  Treasury told me I'm supposed to split it among all heirs.  Don't know who they all are... and if I did that, everyone would probably receive 1.20 apiece... LOL! 

<The most natural question would be "Why doesn't the oil company know who all needs to be paid / ownership has changed?".  The answer is usually quite simple.  Most preprinted lease forms contain a provision that requires any successor interest in a leased property (whether by succession, purchase, or otherwise) to notify lessee in writing and/or provide a recorded or recordable act which vests ownership into the successor owner.  The lessee is not responsible for divining who subsequent owners are (or should be) in a lease once said lease is brought into production, nor are they compelled to engage in such title research.  Further, as to actions (or inaction) by Lessee re: changes to the ownership are not the responsibility of Lessee and are not binding to the Lessee until they have received evidence of such transfer(s).  Therefore, proving up Lessor's successor interest is the successor's burden, not>>>

Thanks for the info.   Got my work 'cut out' for me. 

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Permalink Reply by Dion Warr, CPL on August 7, 2013 at 10:07

B Demery:

I'm not sure who told you "to split it among all heirs", but that can lead to real trouble.  The split is not a equal community share to each, it's their portion of each legal descendant's portion of the total of the estate.  What I mean by that, is that if an heir is the only child of his parent's portion that child inherits the whole portion, which would mean that he would possess five times more interest than his cousin, who was one of five children of his parent (being the only child's uncle or aunt).  You can't just throw all of them into a shoebox and "share and share alike".

 

For instance, each child of your grandfather alive at the time of his passing would receive an equal portion (as he was intestate, per your discussion).  If the property was separate property (e.g., inherited property), this is taken from the whole.  If he was married when and if he purchased the property (assuming intestate succession), the children of each parent would receive a even split from each parent's half interest in the community (barring any other conveyances).  In general, heirs are sought first "down" (descendants), then if no descendants, laterally (siblings), and lastly "up" (ascendants) - however, a surviving parent of a deceased child can inherit a forced portion as well, under certain cirumstances.  Assuming nothing squirrelly in the title (including certain relatives "buying out" other relatives), as long as you trace out each ownership and split evenly when appropriate, this should work.

However, understand that the laws of intestate succession in Louisiana are fairly complex; they were greatly simplified in the last 15 years, particularly as to testate succession, but the vagaries of the heirship law are confounding enough that most O&G companies will suspense any interest of monetary significance until they receive Affidavits of Death and Heirship or a Judgment of Possession (if the sum is large, sometimes only the JOP will do).

Having an abstractor put all of what they can find is a good starting point, but still may require additional research as to heirs that may have moved away.  Also, you may still require an attorney in instances where certain parties may not be traceable or known, or to otherwise interpret the law and provide additional legal remedies as appropriate.

 

Additionally, if you can obtain enough support from identified legal heirs, you may be able (with an attorney's assistance) to have yourself appointed as an administrator of the succession of the patriarch / matriarch that owned the property at the time that title ran afoul.  This legal standing will give you the ability to work with the oil company on behalf of the whole until funds can be found, tracked down and/or remitted to you as administrator.  Being the administrator doesn't solve all of the problems (usually the court and/or heirs will still require you to make a diligent effort to unravel the heirship snafus), but it will allow you (on behalf of the estate) to begin that work with court approval and provide standing to deal with the oil company, unclaimed property folks, etc.  You will be required to disburse the proceeds of the succession to the identified heirs and withhold and account for unknown heirs or those unaccounted for.  Your attorney may be able to suggest means and methods to account for the research required to fulfill your obligations as administrator (including commissioning the work you have discussed here).

 

Good luck with it.  It sounds like a hairball.  However, work you do now will ease the burden on future generations, who will likely have less knowledge to go on than you.

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Permalink Reply by B Demery on August 28, 2013 at 5:09

You have provided excellent information and advice. Hopefully this 'hairball' can be dissolved. There are two pieces of property: one is 20 acres and the other is 75 acres.  Both zoned as timber. I would like to be able to sell timber to split among the known heirs, once things are 'cleaned up.'  We all could use some extra cash.  :) 

The taxes are always paid, but since no one is present to oversee the land,  there are additional problems, such as people stealing timber and illegal hunting. The last time I was there, I found a deer-stand on the property (laden with empty beer cans).  I heard sounds of shotguns or rifles in the woods! And there were heavy tiretracks on the land. It's difficult getting the local LE to do anything, and No Trespassing signs are totally ignored.

I am truly upset, because the blood, sweat, and tears of my grandpa,  his children, and grandchildren are in that land. There are even some illegal burials in the family cemetery.  Not to mention, the 75 acres has an historical legacy.  MyGG-Grandfather, a former slave, is buried on the property.....It's gotten bigger than a 'hairball.'  

Thanks again. We have a lot of work to do.

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