Hi, Please forgive me if I have posted this in the wrong area, this is my first post. I am selling a tract of land with house and producing well. We have been back n forth with the contract. Everything was good to go except now Buyer’s alleged attorney said letter C should be blank, and that only one of the four options are to be marked. If you look at that form (I don’t know if I can post link,but if you google Texas addendum for reservation of oil and gas it will come up) I have box B checked and 85.000 % typed in the space as I want to include 15% of the minerals to the buyer. I also have the box in C checked that I DO NOT waive my surface rights. If neither of the “C” boxes are checked what does the law interpret the meaning of that? In the very beginning of the negotiations they asked me to waive my surface rights and I said no. I know none of this matters for the lease that I have now but what about future leases ? My attorney will not give me an answer to that and said just write it into the contract he is angry because the buyer has continually changed things at last minute down to wanting the grass mowed first. He does not believe they have an attorney because he would normally talk to their attorney about what it is they want exactly before doing contract after contract. I am at my whits end even the realtor is getting frustrated. I read this in an attorneys website. “,If the seller or previous owner has reserved the minerals they have a right to access their minerals by drilling. The only way for a buyer to protect themselves from such intrusion is to provide in the contract is by a waiver of surface rights by the seller and any other previous owner of a mineral interest. if the contract is silent as to a waiver of surface rights, then the buyer can’t demand it, they must buy the property subject to the drilling rights of their predecessors in title.” That to me says it doesn’t need to be checked. I believe the minerals should go with the land but they don’t want to buy anymore percentage even when I offered to finance. If and when current operator is gone I do not want negotiations left up to them since I still own majority minerals as I don’t think they are savvy enough to handle this. Thanks for any advice, Brenda
Brenda, I looked up the form and I believe you have it right, checking the second box in (B) and the second box in (C) that you do not wave your rights to ingress and egress, that belong to the mineral estate. Since you already have a lease with a producing well, that lessee already has the right if ingress and egress, unless you specified no surface use in that oil and gas lease and you can't revoke their right to enter. You might explain to your "rather interesting buyer" my quotes because I said it, that the cat is already out of the bag, that the current lessee already has the right of ingress and egress, that they can't be kicked out and that you are saving the rights of ingress and egress for your decendents should the present lease ever end.
If I were you and any revision to how you filled out the form were to be made, it would be to reserve 100% of the minerals. I think it is nice of you to give the surface owner a stake in the production of any minerals that may occour in the future but I am concerned that your generosity may be confusing this buyer.
Brenda, I am not a lawyer, but I think it is a safe bet that if you reserve mineral rights, that the right of ingress and egress inherent in those mineral rights would prevail if there is no document that says you waved them. I have a suspicious mind about such things and I think that if you left it blank that the buyer would think they could check the waived surface rights box. Possibly you could edit (C) entirely out of the form to appease your buyer,if they want it left blank, you can't get any more blank than gone. I hope this helps.
Thank you for the comment. The buyer does understand that the current operator can do whatever within my lease and they have a copy of the lease. The 15% that I have included starts as soon as they purchase as they are going to put up with lot of activity. The lease road that goes to the wells on said parcel also accesses two other parcels with wells also that I have already sold that land but didn’t have the minerals. Also these wells have seen 5 operator’s in 10 yrs. I inherited the current operator and they are not someone i would have picked. I do.t know if I can leave it out if its a standard form,but I will ask the realtor. Thanks again!
Hi. I am a Texas licensed real estate agent. Forget about "asking" the realtor. It's what you, the seller, wants. It's all about "offer" and "acceptance." The Offer becomes a Contract ONLY after it is signed and accepted by the Buyer.
You, the Seller, offers what you want, and they, the prospective Buyer, can either accept it or not. The RE agent is your employee ... you are the Boss. RE Agents should conduct all transactions in their client's BEST behalf.
Why in the world would you want to give away any of your rights ... surface or mineral? Keep 'em!
Good luck,
Pat
Brenda,
I believe that the advice that Mr. Kennedy gave is very good. You are correct in the way that you filled out the form according to what you stated that you want from the transaction. It appears to me that your prospective buyer is trying to trick you into giving away your right of ingress and egress which would complicate matters for you in the future if you intend to keep your executive right (the right to lease the mineral estate).
This form was created in 2011 by the Texas Real Estate Commission in an attempt to make real estate transactions involving minerals easier and less confusing, but it seems to me that this is a case where using the form could cause more problems than it solves. A situation like this might easily wind up in court at a later date where a panel of judges would have to decide if waiving surface rights equates to waiving the executive right. I don't think it would, but stranger things have happened in the Texas courts. If you were to waive both your rights to the surface and your executive right, you would still have 85% of the minerals, but your buyer would then have control over the leasing of the mineral estate, which is most likely what they want.
From your description of the property it sounds as if this piece of real estate might be difficult to sell without giving a prospective buyer a "piece of the pie" so to speak. I suspect that is the only reason you are including 15% of the minerals in the sale. You might have more luck just trying to sell the entire mineral estate and throwing in the surface as a bonus. The mineral estate would likely be worth much more that the surface anyway.