So sorry to hear about your loss. Many of us have found ourselves in that situation. It can be overwhelming, but you will catch on.
On the bankruptcy files, sort them into piles by company and by date. I put the newest ones on top and put a big binder clip on the whole set. I keep them filed separately because you may have one company that affects more than one well. Make a note as to where the bankruptcy was filed-Texas or OK or another state. If filed in OK, then you may need to deal with them, but not an emergency as royalty owners are usually protected. If filed in TX, then you need to watch more carefully as you may need to file. Once they are settled, you can keep the final orders part but throw away the tons of early notices parts except for the ones that have dates on them that you may need to have filed for relief. Many of the TX ones also rule that mineral owners are a qualified class, so you may not have to worry about them either. For now, don’t throw anything away until you get settled and on top of things.
For the files. See if your grandfather has any other files with the deeds, old correspondence, leases, old DO, etc.
We file our documents by state, county, township-range-section (OK or ND, etc) or by abstract (TX, etc.). I make a folder for each tract of land. I put everything in chronological order with oldest at the back. The division orders should be pretty close to the top.
Look at the DO. If it is a copy, then file in the correct folder with that description and make sure the decimal number matches the check decimal number. If you do not have a matching check, then put a sticky note on it because you will need to keep an eye out for the checks or follow up. If the DO is original, check the state. If Texas, then your grandfather will have to sign it (if he is the owner) and turn it back or you don’t get paid. Send by certified return receipt mail and keep a copy in the file. I am not fond of TX Division orders as many try to change the terms of the lease. I use a letter or the NADOA form and a W-9 instead. 0_NADOA_Division Order Model Blank Form 2017v 2.pdf (78.2 KB)
Oklahoma does not require that a DO be returned. But I do send a letter or the NADOA form back so they will not take out Federal income tax and so I have a record of the correct decimal amount. Do not assume they are right (we can come back to that).
The Division Orders are probably more important the the bankruptcy notices at the moment. Get both sorted and then plunge into the DO first to see which ones you have to send in and which ones you do not. Contact your grandparents’ attorney and accountant to get things rolling on the estate of your grandmother. It can be very easy or it can be complicated. If the minerals were in her name, then the DO is a bit more complex as the operator will need the probate documents. If the minerals are in your grandfather’s name only, then you may need help from the attorney to see if you can help him sign if he has enough clarity or if he needs a Power of Attorney designated to take care of his legal affairs. One way or another, getting organized is the first step. If the minerals are held jointly, then how they are titled will matter from state to state and you need to get an attorney involved to make sure you do everything correctly.
Have they been cashing their checks? If so, make sure that you keep all the statements that go with them-for seven years. Keeping the oil business part straight while you are dealing with probate is a challenge (been there, done that), so keeping things in good order helps. The 1099-MISC are starting to come in now, so keep all those and be ready with them for taxes.
