Help! Inherited Gas Lease, Royalties, Probate, and Asset Recovery Issues

Hi. I’m new to this forum and I need help. I have to admit I haven’t exactly stayed on top of this matter over the years, but want to clear it up now. Apologies for the length—I don’t know what’s relevant.

I inherited a small percentage gas lease, no surface rights, from my father, who died in 1998. I was his sole heir, he didn’t have any assets I knew about, and there was no probate. I used to get small (like $6-$30) royalty checks from this lease before he died. I had taken over paying the taxes on the lease after he went into a nursing home, 5 years before he died. I’ve paid them ever since. At some point I owed the nursing home money I couldn’t pay at the time. I remember changing the recipient name of the royalties to the nursing home and thought they were receiving the payments, since I stopped receiving them. I forgot about this, partly because the royalties were never consistent or larger than a few bucks anyway, and also because the circumstances of his injury in the nursing home, his death, and a subsequent nightmare of a situation with the crematory that I won’t go into, were so traumatic I didn’t want to have anything to do with either of them ever again.

In 2009, I was contacted by a legitimate asset recovery firm, who informed me there were unclaimed funds in his name held by the State of New Mexico (where he died and I lived). I verified with the state these funds were indeed held by them. The asset locator was really nice and helped me and revealed that the funds came from XTO Energy. They were/are apparently the latest owners/producers of the gas field. I want to and will pay the locator his percentage when I do file the claim. But the state told me I had to probate the estate first.

I began to go about the process of probate and had to provide a death certificate, only to find that not only didn’t the state, nursing home, attending physician’s office, the hospital, or the crematory have a copy of the death certificate, but the crematory had never actually filed the form I’d sent them when he died. Then, due to records retention/destruction policies and changes of ownership, neither the hospital where he died, nor the nursing home, nor the now dead attending physician’s office, nor the now sold crematory had any records of his existence or death. I finally got a new death certificate from the state medical examiner who managed to get enough information from my copy of the certificate and from the fact vital record office had a record of his death, even though there was no death certificate ever filed. All of this took quite a while and I moved to a new state in the meantime.

So now I need to file an intestate probation because, as it turns out, I didn’t have a signed copy of the will my dad had drawn up and never changed, only an unsigned copy. It never mattered because he had no assets in his name that I knew about, having signed them over to me and my mother (even though they were divorced) years prior to his entering the nursing home. But his lawyer, now dead (who also happened to be his nephew), and the still extant law firm of his name, doesn’t have a copy of the will and it was never recorded in the Texas county where he lived prior to the nursing home in New Mexico.

Additional facts:

  1. I have no record of transfer of ownership of the gas lease, but I did used to receive checks in my name and my dad always said he had purchased that lease in my and my sister’s (now deceased) names.
  2. Of course, now the nursing home says they didn’t receive or know anything about any royalty payments, but can’t reveal any sources of income.
  3. I currently live in Florida but am moving back to New Mexico to take care of my elderly mother by the end of this month.
  4. I need to act quickly because I understand the State of New Mexico is trying to find a way to keep all these types of assets.

My questions are these:

  1. Do I need to list the funds from XTO as an asset in the probate since it wasn’t there when he died?
  2. Do I need to prove ownership of the gas lease other than by being sole heir?
  3. How do I find out whether XTO is still the producer/operator?
  4. If these royalties were not paid to anyone for some length of time such that XTO cut them off at a certain amount and turned them over to the state, does this mean they somehow legally stopped paying them?
  5. Will it be possible and how do go about getting XTO or whoever the producer is now, to continue to pay royalties and/or to pay back royalties from whatever date they turned them over to the state?
  6. How do I find out who the producer/operator is now?
  7. What exactly do I do first?
  8. I can file the probate myself in Probate Court, but do I need a lawyer?

I thought, okay this is easy and I pulled out my Uniform Trust and Estate Statutes and then I saw you have numerous road blocks in your way so I put my probate code book down and suggest to you, an attorney. I am in Hawaii and I know that intestate probate can take up to 18 months and involves a succession of legal documents that must be filed with the probate court and a "notice to creditors" ad that must run for 6 consecutive weeks in the newspaper before it is over. If papa left you a power of attorney it would make it easier but I did not hear you say you have one. Most states have on-line access to property deeds and mineral leases. Typically it simply costs a couple dollars if you download the document but check the county bureau of conveyances or county website and you may be able to see the last few years of deeds and leases if you have the TMK # or name of Grantor and Grantee. Also try putting your property information in the search engine and see what comes up. You can try probate pro se with all the on-line help resources so check you county court website for probate petitions and forms to use and guidelines to follow. It may be easier in your state than in mine. Aloha nui loa a hui hou