Mineral Rights Inheritance Question

Law & Legal
1

My father passed away a few months ago and gave me a mineral rights deed just 2 days before he passed. I've checked with the county recorder and the mineral rights are still recorded in his name. He had very few assets and his estate was not probated. He had a will and the few things he owned, with the exception of the mineral rights, has been passed on according to his wishes.

I have a death certificate and the will, but I'm wondering if there's something else needed to record the rights in mine and my sister's names. We have no idea if the mineral rights actually have any value, but properties not far from this piece of land have produced natural gas. I realize that doesn't mean there's natural gas or anything else of mineral value on this property, but if someone decided to investigate for anything of value, we'd like to correctly show who to contact. The surface rights were sold back in early 90's by my father, but the mineral rights were retained. The man who bought the property for development was incensed that my dad wouldn't part with the mineral rights, but dad held firm.

The question is what paperwork do I need to complete to transfer the rights from his name to ours? Do I need to involve an attorney, title company, or can I do this myself?

Thanks in advance for any answers.

2

Where are the minerals located?

3

They're located in Summit County, Utah.

4

The best way to do it is to probate your father's estate. Another way which is more of a band aid than anything is to record an Affidavit of Heirship. If someone were to approach you for a lease, they may ask for an Affidavit of Heirship and record that along with the lease. However, from my experience, not many companies will pay royalties if the estate is not probated. I know that we don't. I would speak to an attorney and see what he/she says. We have taken leases in the past with just an Affidavit of Heirship, but when it goes to a title opinion, the attorney will almost always require that the estate be probated in order to pay any royalties. They are looking for a clean chain of title, an although an Affidavit of Heirship may do for a lease, it won't for payment of royalties. I would talk to an attorney to see. My advice would be to clear the title to you and your sister and the best way to do it is thru the probate process.

5

Dear Mr. Stevens,

My condolences on your loss.

If you have received a deed from your father prior to his death, was it eligible to be recorded and was it recorded? If so, do you have a copy of it? Was the transfer to you and your sister in the form of a life estate or joint tenancy with the right of survivor? It might have been a straight transfer and if that is the case, there is not more to do other than record the deed.

Best

Buddy Cotten
6

The key to unlocking the mystery of your question is very simple. No one, however, can assume that there was any type of transfer to you and your sister UNLESS you clarify what you mean by "he gave you a mineral rights deed." What exactly did that deed say? The comments about probating your father's estate are absurd and miss the whole point of your question. You very clearly write that no mineral interest passes under the terms of the will.

It's also very clear from your question that you have not yet recorded a deed that transfers the mineral rights into you and/or your sister.

The solution may be a simple one. If you meant that your father deeded you and your sister the mineral rights prior to his death, and it was properly acknowledged, then all you need to do is record that deed in the Office of County Clerk where the land is located.

7

Our mineral leases are in New Mexico. Most of them are under lands owned by our two trusts; the properties are listed in the trusts, but there is one piece of mineral lease with a problem. My parents sold a 40-acre surface land parcel to a utility company long ago; in going over the sale documents before my parents died, I discovered that the document did not specify that the minerals were left with my parents. Parents hired the local lawyer who prepared a set of corrected documents, everyone concerned signed them, the papers were recorded.

However, somehow these minerals did not get into the trusts. It may be the fault of the lawyer who prepared the trusts, or the subsequent NM lawyer who checked the wills, trusts, papers, etc for adherence to NM law. Now, my parents are dead and the trusts cannot be changed. Even though the "pour-over" wills specifically say that any property that did not get into the trusts, that should have been, - are to be put into the trusts (it actually says, anything my parents owned that did not get into the trust formally) - that oil company will not recognize that these minerals are owned by the inheriting trusts.

These wills did not have to be probated, and were not. Now, I am advised by the oil company, and lawyers, that in order to receive the royalties each month, I must probate the wills. Even though we specifically put the property inside the trusts to avoid probate (legal advice). This was not the only reason for the trusts - another was that my father wished to maintain privacy.

Well. I have written long explanatory letters to the oil company, enclosing death certificates, will copies, trust affidavits, etc etc. I have argued over the phone. I have insisted on talking to the head of the department. And, by the way, (not that this matters, I am told) just for information, I am an only child and am the sole heir, the sole trustee and beneficiary of my mother's trust and of my father's trust. The oil company's reply is, Probate the wills. . . I've been advised that this will be quite costly. And by now, I've kinda got my back up and DO NOT WANT TO probate no matter what. (Of course, if this is the law, I guess I will eventually have to do it anyway. ???)

Believe it or not, the way things stand right now: The oil company sends a royalty check every month made out to my parents' individual names, regular as clockwork. I deposit each into the trusts' bank account. My parents would be about 110 years of age now. And no, I am not particularly concerned that I will be prosecuted for anything; I am putting the money where it was intended to go.

I would appreciate advice on this matter.

8

Based on the sentence "My parents would be about 110 years of age now", the question may be moot, and the oil company may be asking of you what is legally impossible. There should be a statute of limitations on the probating of the will. I think it's four years in Texas. N.M. probably has a similar statute. I would check on that if I were you.

9


New Mexico appears to have a three year statute. However, there are various exceptions to the rule. You may want to consult a New Mexico estate attorney, and ask them if probate is even possible at this point.
Dave Quincy said:

Based on the sentence "My parents would be about 110 years of age now", the question may be moot, and the oil company may be asking of you what is legally impossible. There should be a statute of limitations on the probating of the will. I think it's four years in Texas. N.M. probably has a similar statute. I would check on that if I were you.

10

Did you record the mineral deed before he died? If not, then when he died, they are still in his name and should have been probated in his estate. I beleive that these unrecorded deeds are called "dresser drawer deeds" and are invalid if not recorded by the time of the grantors death.

Now, In his will, is there a clause specifying that anything missed in the probate will transfer to the heirs just as if it was included in the list of assets in he probate? If so, then you should be OK, if not, then you might have to re-open the probate because of the missed assets.

11

A related question: Is it sufficient to record an affidavit of heirship in each OK county where we have mineral interests, in order to have oil companies, etc, be able to contact the correct person if they are interested in leasing? In most of the counties where we have interests, my mother is listed as the contact person, but I am now the trustee and she has not been at her old, recorded address for over 5 years, and mail etc. will not be forwarded to her nor to me. I had planned to try to record in each county the whole chain of paperwork proving my authority to negotiate leases, but many of the counties say they will only record from the originals, and I live in TN and don't want to send those through the mail. Once I am contacted by the company interested in leasing, I can easily prove my authority. Any thoughts?

12

I went through the same procedure years ago when my husband passed away. He had inherited the mineral rights from his parents, but they were never recorded. Then upon his death those rights passed on to me. My suggestion is for you to contact the probate court in the county where those mineral rights are located and ask them on how to proceed. Every state and/or county may have a different procedure in place. Good luck, it took me years to “accomplish my mission”.

13

Hi. When our father died, my sisters and I inherited our mother's interest in land and mineral rights in N. Dak. Before the oil company would do business with us, we had to probate our mother's estate in N. Dak. We did not probate her estate where we live since it was a small estate and at the time of her death, we never imagined there would be any income from the property in N. Dak. It cost approx. $1,000 to probate the estate and that was around 2010 or 2011. We now receive income on the oil and nat. gas for our share of the property.

14

Scott, I would suggest you join the Utah group and if they have a group for Summit County join that group as well. Then as the group members for referrals for a lawyer they have used for handling a situation like yours. We had a similar situation in North Dakota but every state can be different. Using a lawyer in the state where the property will be registered is the best way to go and your members in the state or county group can recommend attorneys that are knowledgeable and offer fair pricing. I used this referral process in ND and it saved me money and found me an excellent attorney. Goog luck, Bob

15

What are the necessary steps for the county recorder's office? Do they spell out the necessary steps to take?

16


Good advice, Bob. I'll do that.
Bob Kelley said:

Scott, I would suggest you join the Utah group and if they have a group for Summit County join that group as well. Then as the group members for referrals for a lawyer they have used for handling a situation like yours. We had a similar situation in North Dakota but every state can be different. Using a lawyer in the state where the property will be registered is the best way to go and your members in the state or county group can recommend attorneys that are knowledgeable and offer fair pricing. I used this referral process in ND and it saved me money and found me an excellent attorney. Goog luck, Bob

17

Hi Mark. I called the county recorder's office and was told I needed an "Affidavit of Death" and a "Quit Claim Deed," showing mine and my sister's names and addresses. The person I spoke to also said the forms would have to be notarized. I found templates for both forms on the state legislature website and re-typed them with the correct information. I had them notarized and made a trip to the county recorder's office, hoping that everything would be resolved with one visit. The county recorder was very helpful, but she said I need to show evidence that I'm the executor of my Dad's estate. She said that I need to talk with a probate attorney. She also said that the location information on the mineral deed my Dad gave me is slightly different from the county's information, so I'll have to have a title search done. I wasn't expecting to pay much for the transfer of the rights, but apparently I'll need to play their game. I mentioned to the recorder that I wasn't sure the mineral rights have any value, but she said there have been "many surprises lately" in the area. She said that "quite a few people thought their mineral rights were worthless but they were proven wrong." She said to make sure that everything is done correctly to make certain the rights are recorded in the right names. So that's what I'll do.

Mark James said:

What are the necessary steps for the county recorder's office? Do they spell out the necessary steps to take?

18

Mineral rights are for life, so if not valuable now, they could be later. (Or even later for your children.)