I am pooled with more than one well drilled by the same company. Each time I receive a division order I ask the company to send me their math calculations. Usually the company responses in a timely manner. I have found errors and have attempted to explain why they are incorrect. But I continue to receive money with direct deposit. As each new well produces, the company starts paying before the division order is signed. Sometimes before the division order is even mailed. By accepting these royalty payments, am I approving their decimal interest calculations by default? What do I do?
Although I am not an attorney, I believe that simply cashing your checks does not amount to an agreement with their calculations.
As to why you seem to get nowhere with your phone calls, the Company is most likely paying based on a Division Order Title Opinion that was prepared by an attorney. The Title Opinion will have been prepared by the attorney based on the documents filed of record at the courthouse. If there is a mistake in those records, it will be up to you to get them corrected before they will do anything. I know you probably don't want to hear this, but you really should engage a knowledgeable Landman or Attorney to help you.
Good luck.
Thanks Steve. I've heard this question answered both ways though, hence my question here at the forum. The oil company was Forest Oil, now taken over by Sabine Oil. This is my first experience receiving royalty from an oil lease. In the 80's our land was leased for exploration in the Austin Chalk, then again in the 90's when horizontal drilling gave oil companies another reason to try the Chalk. And now it is the Eagle Ford Shale.
In my limited experience, I thought the process went something like this.......surface lease signed, wells staked, ratification of the oil lease for each of the mineral owners, drilling, production, division orders, and then the money arrives. When other oil wells are drilled in a existing pool or unit, ratification is not needed.
I have talked with a lawyer, haven't hired him yet. He has personal experience with one of the other companies operating in the Eagle Ford and he said he has seen the same problems as I have described.
I want to trust my oil company, but the less cooperation I get, the harder it is to trust them.
I was advised by the SWKROA (SW Kansas Royalty Owners Association) to always put "Payment on royalty account without prejudice to further claims" on the back of all royalty checks along with your endorsement before cashing the checks.
So, I had a stamp prepared with that exact wording and do it religiously on the back of all royalty payment checks when I submit them for deposit.
http://www.nadoa.org/forms/div_ord.pdf
This is the NADOA form. Most companies accept it. Not all of them. If you have a decimal interest discrepancy, you can request the title opinion. Most companies do not send it to the royalty owners. They would send it to a WI owner though.