My family has almost completed the leasing process for mineral rights in Reeves County which we inherited. We have signed contracts and most of us have received our bonus checks. Now the lessor has put on the brakes, citing Section 38(a) (4) of the Texas Probate Code. (that section has been repealed, but my cousin's death occurred before the repeal) The lessor states that according to the code, the portion of our interest in the rights which was inherited from this cousin may not be rightfully ours, but should revert to our cousin's maternal kindred. The mineral rights were separate property from the cousin's father. My cousin was never a resident of Texas. We're not sure where the lessor is trying to go from here, but he has stated that we may have been overpaid. Have any of you encountered this situation before?
You need a lawyer. Reeves County is a high producing area. If there is a probated will somewhere it should cure up any questions, if not you really need a lawyer.
Did the person you inherited from have a Will or die intestate? It makes no difference where your cousin lived since the property is in Texas, Texas law prevails.
Did your cousin die before the person you inherited from die?
The company that contacted you to lease is the lessee. You are the lessor.
It sounds like there may not have been a will, and there was a bad interpretation of the Texas probate code.
The explanation offered you may be plausible. You can try researching it yourself, or hire someone. The issue then becomes whether it is worth it based on what you and your family will receive.
Thanks Charles, My cousin died intestate. The mineral rights were inherited from my grandfather, then his children. My brothers and I inherited my mother's portion. One of my uncles is still living, so he has his portion. The other uncle died, having only one child (my cousin) who died without descendants. My cousin died after my mother died. Does that make a difference?
Thanks Mark,
Of course, I meant to say lessee. There was no will. See my reply to Charles above for details. So far, we can't track the maternal side of the family. My cousin's mother had no siblings. We don't really know anyone descended from his mother's aunts or uncles. That's getting pretty far removed. We'll have to weigh the cost of a more aggressive search against the value of the mineral rights.
Kathleen,
I have a question, did your cousin die before his mother? If your cousin predeceased his mother, then the Oil Co. is probably right and the property went to your Aunt then upon her death, went to whomever her heirs were.
Hi Texas Tea,
No, my Aunt died before my cousin. This all seems very strange, in that the mineral rights were purchased by our paternal grandfather and had absolutely nothing to do with my cousin's maternal kindred. Just seems weird that they would inherit anything from it.
I agree with you that it would seem strange, but the law is the law. In this situation, what would appear to happen is when your cousin died intestate without any children and no living parents, the property would be divided in 2 parts. Half would go to the heirs of his mother (Her parents - if living (which I would assume they weren't), if not then her siblings - if living, if not then her sibling's children - if living...and so on. The other half interest would go to your cousin's father's side. It looks like that would be divided between the heirs of your mother (you and your brothers) and your uncle. So you would receive a part of your cousin's property, but half would also go to the "other side" of your cousin's family.
Hope this helps.
One assumption I did make, I'm assuming that your Grandfather predeceased your deceased cousin? If so, the above would be true.
The Texas Probate Code is extremely confusing. While I am not an attorney, I do know alot about the laws of descent and distribution, which dictate WHO inherits property in the case of an intestate. My assessment given the fact situation you presented is that IF your cousin died (1) WITHOUT a Will, (2) WITHOUT a surviving spouse, (3) WITHOUT any living descendant, (4) WITHOUT any sibling, including any sibling who had been adopted, (5) WITHOUT a living biological parent, and (6) AFTER your grandfather died, then Texas Tea's comment is correct: your cousin's mineral interest would be divided into two pieces, called "moieties," with one moiety going to his father (your uncle's) side of the family and the other moiety going to his mother's side of the family. It is a pretty rare circumstance where all those conditions are met, I have encountered only about 9-10 in my career. But that would explain how your cousin's mother's family got a piece of the action. So you should have inherited a partial mineral interest from your mother AND, as blood relatives of your cousin, you and your living uncle should have inherited a part of your cousin's mineral interest as well.
Your cousin's never having resided in Texas is irrelevant. Also, if the Operator overpaid you on your ROYALTIES, then they can, I believe, withhold future royalties to reimburse themselves for the royalties that they mistakenly paid to you. However, it sounds like they did not do that, it sounds like they are claiming to have overpaid you on your BONUS only. If they overpaid you in bonus consideration, then if there was a Warranty of Title clause in your Lease you might be obligated, depending upon how the Lease is written, to return the bonus payment to the Operator. If you choose not to return the bonus money, then the Operator would have to sue you and would have a very good chance of winning, again depending upon the wording. If they demand the money back, I would give it back if you have not spent it already, and I would reduce the amount returned by any income taxes that you paid on that income, if any. Good luck to you.