On May 9, I received an offer to lease from Fillmore Energy Resources in Section 14, T7N, R3W. I have questions regarding this whole process… I returned their Offer to Lease and a signed lease on June 25. Fillmore said the lease was good except for two clauses so I removed those two clauses and resubmitted the lease. Then Fillmore said the lease was good except the margins on the lease were not in compliance with what the McClain County Court House would accept; so I redid the margins and submitted the lease again; (as a side comment, I called the Purcell County Court House to confirm margin requirements and the margins the Court House gave me were not the same as Fillmore had stated.) After submitting the lease again, Fillmore said I needed a more complete legal. I had wondered about that early on in the leasing, but they kept telling me the lease was acceptable except for the things I mentioned above; so I submitted the lease again with a more complete legal. Then the Fillmore office help supposedly became confused about which lease was the current lease and denied it again! The landman told me that all the confusion was because I didn’t use Fillmore’s standard lease. Fillmore received the final lease on July 30. On August 15 their office help finally figured out the lease they received on July 30 was the one they should be looking at, and I received an email from the landman saying “everything should be good to go now.”
I have heard nothing since…How do I know if they are actually doing anything with the lease? Do I receive anything from them? The landman told me they usually send the signing bonus check out 40 days from the date of the receipt of the lease. They received the lease on July 30 - but it took another 15 days for them to get their act together… .From the date they received the lease, would make 40 days out fall on September 8.
I have wondered if they were just using all the ‘problems’ pertaining to the lease as stall tactics. To what advantage, I don’t know. Can they legally do that?
So do I sit patiently and wait? What happens now? I don’t know if there is a lease pending or not. It all seems to be weighed in the oil company’s favor. Are my mineral acres legally tied up or could I lease to another company?
I was recently advised to never provide a lease until I had a check in hand. How does one go about doing that when one lives in another state? I doubt they would send me a check until they have a lease in hand… Kind of a “Mexican Standoff” (if you will excuse the expression) Thank you…
However, a case could be made that consideration hasn’t been fulfilled, leaving the contractual obligations in limbo. I’m not an attorney, but I would say you are stuck at the moment. If you don’t receive your bonus in a reasonable amount of time, then you could possibly start to make a case for a breach.
At this point though, all you can really do is wait and periodically reach out to them to see where they’re at in the payment process.
For future reference, you can hold on to the original lease until payment is received, even being out of state. In my experience, the lessor emails/mails a copy of the executed copy, and that is usually sufficient. There are other methods as well, but that’s the easiest imo.
Their conduct stinks. Posting the name of the lanman at Fillmore that you dealt with would help others here to avoid being sucked in by such unethical behavior.
An attorney could advise if their conduct is also actionable.
I would say it was all a stall contact , while they try to re-lease to someone else, meanwhile trying to keep you committed. There are a lot of crooks in the oil business.
Thank you for your response. After I posted on this forum, I sent an email to the Landman asking for a status. He had to check with his main office, but got back to me right away and said, “You will be paid around 9/25. We require about 40 banking days for payment.” EDITED He was always so nice and polite and apologetic, But can’t help but wonder if that is part of his “con man” personality… Hopefully, what I went through will save someone else from the same unethical behaviour! Plus, it has helped me to ‘learn the ropes’ a little better… all I can say, is “never again!”
Thank you for your help. The Landman (after I bugged him) said I would be paid around 9/25. I would imagine he means the check will be sent then - not that it should be in my hands by then. So do you recommend that I wait or go ahead and file an affidavit of non payment? I am assuming it would take that long to fill out the Affidavit, mail it, and the courthouse process it… They have stalled for so long, I have a hard time believing anything they say…
More info about the AAPL please. I too have issues with a different company and a landman that has been significantly less than truthful (as has the company he works for). Does that association have sanctioning procedures/capabilities??
This document sets out the standards for landmen that the public should be able to rely on. Unfortunately, there are some landmen that are not members, and many who have not read these.
Thank you for the information. I have been forced to hire an attorney to deal with my current issue- very frustrating when companies can’t do business honestly and ethically
they have had my lease 45 days and the owner told his landman to tell me that its going to take 2 more weeks,unreal.never had thjis happoen before.but they clam that 2.11 acres is open even though oakland enery has been holding my checks for the last 2 years because they only total 57 dollars.When I talked to the oa
kland people and told them that fillmore says that 2.11 acres are open to lease they dont know what to think either.The secretary for Oakland said well,it cant be for lease because we are still paying you.I said well Fillmore Energy is in the process,so they tell me of leasing 2.11 acres out t
he total of 3.035524 acres.Then she said well I dont whats going on then you need to speak to the owner.I told her I have left him numerous messages over the last 10 days and he will not respond.So if anyone every see"s where fillmore filed paperwork on Sec-20-7N-3W please feel free to contact me.It makes me think that it all may be HBP but it was vertical completed in 2012 but the well grossed over 200k so far this year. .Any help would be greatly appreciated.
David, you have several issues going on which have logical explanations.
First, the current well has a Division Order that probably had a minimum payments of $100, so they only have to pay you once a year. That can be fixed to be reset to $25, so you get paid more often and can keep an eye on the well. You can file a new Division Order with them. Use the NADOA form and copy the contents of the original one onto it and just change the minimum payment portion. 0_NADOA_Division Order Example 2-15-1.pdf (71.7 KB)
Second, that well had a certain spacing. You didn’t describe your total legal description, but often, a well will only be holding a portion of your minerals. Do you have a Pugh clause in the first lease from a long time ago? It can sometimes release the other acreage.
Fillmore has filed many leases in 20. You can go online at okcountyrecords.com and see if one of them is yours.
Third,
Did you sign a draft payment of lease? It has terms in there and extension of terms. They can be quite onerous on time and give the lessee quite a bit of time to pay. If you signed it, then you don’t have room to fuss unless they have broken the terms and then you have to follow their rules to file the complaint.
Fourth, Are you talking about the Okland Brody 1-20? It is online. Spaced at 80 acres. http://imaging.occeweb.com/OG/Well%20Records/03019142.pdf. Look at the shape of the spacing unit. Stand up 80 acres. Where does your legal description overlap that spacing? All inside it, or part outside in the east half of the Southeast quarter.
Not to quibble with the advice given, but this seems to clearly fall in the realm of legal advice.
Do you rely on geological advice from your lawyer? If not, it is wise to ascertain to what extent the advice is based on legal expertise.
Was making a suggestion to read the terms of the draft payment (if he signed it) as they can be quite complicated and stretch the time out far beyond what folks like. Read it and then figure out if you need legal advice or have to abide by the time frame and file the proper complaint, in writing, etc. I read one recently that stretched the time out to almost nine months due to all the clauses that were in it. Just common sense, not legal advice.
Thank you…