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Permalink Reply by Skip Peel - Mineral Consultant on September 17, 2011 at 3:53

Mike, you will need copies of the relevant conveyance documents in order to know the exact details and therefore get accurate answers to your questions.  The specifics are important.  Do you have a copy of a succession, judgment of possession or donation conveying the property from your grandfather to your father and uncle?  Do you have a copy of the deed by which your uncle sold the property?  Do you know when the sale of the property occurred? 

Families having clouded title to land and minerals is a common occurrence in NW. LA.  Energy companies and land companies that often represent them in acquiring leases will perform some level of due diligence to determine who to lease.  In some instances they may simply lease every individual they can identify who might have an interest in a mineral tract.  These are called "protection leases" and the cost can be less than performing a full title review and filing additional documents to prove up the title chain.  However they will go only so far as to protect their own interests and when their title work does not fully clear a title, the family members can end up in a situation where royalty payments are withheld.  An operator will often suspend payments to protect themselves from future litigation regarding rightful title and it then becomes the responsibility of the heirs to take the required legal action to have a court determine and certify who owns what.  When this type of situation is known to exist prior to signing leases, it can be a good idea to hire an experienced Oil & Gas attorney to insure that the lessee performs all work to remove any clouds to the title for the lessors.  The cost to construct a merchantable chain of title can be more than the lessors can afford to pay.

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Permalink Reply by LesterG on September 17, 2011 at 15:16

Had  a similar issue.  The oil and gas company asissted in clearing up the clouded title with a "declaration of interest" that got filed in the Mansfield courthouse.  200 heirs involved in that debacle... wow, glad to get that settled...

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Permalink Reply by Skip Peel - Mineral Consultant on September 17, 2011 at 15:25

I have worked on some complicated family titles, LesterG.  But nothing like 200 heirs.  You and your family are fortunate that the O&G company was able to get everyone to agree to the declaration of interest.  In some cases, a lessee will agree to pay royalty on clouded titles with an Affidavit of Heirship if witnesses who meet requirements can be found.  The point that is important to get across is that families should file conveyance documents every time that properties are passed to heirs.

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Permalink Reply by LesterG on September 17, 2011 at 15:35

Please belive me Skip...we had some near boxing matches...but the situation was often one of misunderstanding and confusion regarding sales within the family and one group holding more interest... omg... it was basically we struck while the oil companies lawyers were willing to assist, they really had already done all the title work.  It was up to the hardheaded heirs to realize how the successions and deeds and conveyances and deals done by word of mouth all added up to who had intrest in what acreage... it was basically accomplished by groups within the family quelling the confusion and finally getting all to see the light...it was tough!

 

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Permalink Reply by LesterG on September 17, 2011 at 15:39

we have added two groups of heirs by family members passing away in the last year since the document was filed and we are quick to get the affidavits of heirships on file right away....

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