Bought a house after previous owner signed up mineral lease

Ownership and Title
#1

Hello,

I lived in Grapevine, TX of tarrant county. I bought my current house in December 2009. Before I signed my house contract, I knew previous owner had already signed gas mineral lease with a big gas company in August 2009. In house purchase contract, I clearly said that all mineral rights will be convey to me. We both signed contract.

My question is: Can I get some lease bonus because I have mineral rights?

I believe lease agreement time is from August 2009 to August 2011, so I have mineral rights most of time during this period.

Thanks,
Joey

#2

Joey:

My first question is did you file the necessary paperwork with the Tarrent County Clerk's office in regards to the purchase of these minerals? If you failed to file this paperwork with the County Clerk's office, the previious owner will still be on record. I don't know what agreement was made between you and the seller of these mineral rights but I will guess that you probably won't recieve any lease bonus until a new lease is negotiated for these minerals. Again, if your purchase agreement included the bonus for these minerals, this would be a different factor in the deal. Have you got a copy of the lease which expired in August 2011? You will need to know if there was an extention clause. Your main objective at the present time is to make sure this lease is recorded in your name at the County Clerk's office.

#3

Hello, Thanks for your reply. This is what happened. I added the following in house contract: all mineral rights should be conveyed to me along with house. This is not the exact words, but with the same meaning. We didn’t negotiate this lease sign in bonus when I bought this house. I didn’t file any paper work with county office after this. Would you please answer me the following questions? Thanks. 1. How to file paperwork with county office?2. Why I still need to file this paperwork even I said that all mineral rights should belong to me?3. Why I can’t get any portion of bonus if I have mineral rights, which sounds unreasonable to me? Thank you again,Joey

charles s mallory said:

Joey:

My first question is did you file the necessary paperwork with the Tarrent County Clerk’s office in regards to the purchase of these minerals? If you failed to file this paperwork with the County Clerk’s office, the previious owner will still be on record. I don’t know what agreement was made between you and the seller of these mineral rights but I will guess that you probably won’t recieve any lease bonus until a new lease is negotiated for these minerals. Again, if your purchase agreement included the bonus for these minerals, this would be a different factor in the deal. Have you got a copy of the lease which expired in August 2011? You will need to know if there was an extention clause. Your main objective at the present time is to make sure this lease is recorded in your name at the County Clerk’s office.

#4

Joey:

When my mineral paperwork was filed with the County Clerk's office, I hired the services of an oil and gas attorney, who filed this paperwork along with taking care of other legal matters regarding my minerals. All mineral ownership must be on file with the County Clerks office and this is the source for landmen or oil company reps to get the information on who owns the minerals. Again, the bonus would be yours if a new lease is negotiated and the legal staus is in order. My suggestion is to get some legal assistence on this matter in order to make sure all records are properly recorded.

Joey said:

Hello,
Thanks for your reply. This is what happened.
I added the following in house contract: all mineral rights should be conveyed to me along with house. This is not the exact words, but with the same meaning. We didn't negotiate this lease sign in bonus when I bought this house. I didn't file any paper work with county office after this.
Would you please answer me the following questions? Thanks. 1. How to file paperwork with county office?2. Why I still need to file this paperwork even I said that all mineral rights should belong to me?3. Why I can't get any portion of bonus if I have mineral rights, which sounds unreasonable to me?
Thank you again,Joey

charles s mallory said:

Joey:

My first question is did you file the necessary paperwork with the Tarrent County Clerk's office in regards to the purchase of these minerals? If you failed to file this paperwork with the County Clerk's office, the previious owner will still be on record. I don't know what agreement was made between you and the seller of these mineral rights but I will guess that you probably won't recieve any lease bonus until a new lease is negotiated for these minerals. Again, if your purchase agreement included the bonus for these minerals, this would be a different factor in the deal. Have you got a copy of the lease which expired in August 2011? You will need to know if there was an extention clause. Your main objective at the present time is to make sure this lease is recorded in your name at the County Clerk's office.

#5

May I ask you which state do you live in now? Also in Texas?

charles s mallory said:

Joey:

When my mineral paperwork was filed with the County Clerk’s office, I hired the services of an oil and gas attorney, who filed this paperwork along with taking care of other legal matters regarding my minerals. All mineral ownership must be on file with the County Clerks office and this is the source for landmen or oil company reps to get the information on who owns the minerals. Again, the bonus would be yours if a new lease is negotiated and the legal staus is in order. My suggestion is to get some legal assistence on this matter in order to make sure all records are properly recorded.

Joey said:

Hello,
Thanks for your reply. This is what happened.
I added the following in house contract: all mineral rights should be conveyed to me along with house. This is not the exact words, but with the same meaning. We didn’t negotiate this lease sign in bonus when I bought this house. I didn’t file any paper work with county office after this.
Would you please answer me the following questions? Thanks. 1. How to file paperwork with county office?2. Why I still need to file this paperwork even I said that all mineral rights should belong to me?3. Why I can’t get any portion of bonus if I have mineral rights, which sounds unreasonable to me?
Thank you again,Joey

charles s mallory said:

Joey:

My first question is did you file the necessary paperwork with the Tarrent County Clerk’s office in regards to the purchase of these minerals? If you failed to file this paperwork with the County Clerk’s office, the previious owner will still be on record. I don’t know what agreement was made between you and the seller of these mineral rights but I will guess that you probably won’t recieve any lease bonus until a new lease is negotiated for these minerals. Again, if your purchase agreement included the bonus for these minerals, this would be a different factor in the deal. Have you got a copy of the lease which expired in August 2011? You will need to know if there was an extention clause. Your main objective at the present time is to make sure this lease is recorded in your name at the County Clerk’s office.

#6

Joey:

I live in Texas but my minerals are located in both Montana and North Dakota (Bakken Shale). I had to handle my legal matters on a long distance basis. I am somewhat familiar with the Barnett Shale but I don't know any attorney's in that area. Most likely, Chesapeake or XTO is still leasing in your area around Grapevine.

Joey said:

May I ask you which state do you live in now? Also in Texas?

charles s mallory said:

Joey:

When my mineral paperwork was filed with the County Clerk's office, I hired the services of an oil and gas attorney, who filed this paperwork along with taking care of other legal matters regarding my minerals. All mineral ownership must be on file with the County Clerks office and this is the source for landmen or oil company reps to get the information on who owns the minerals. Again, the bonus would be yours if a new lease is negotiated and the legal staus is in order. My suggestion is to get some legal assistence on this matter in order to make sure all records are properly recorded.

Joey said:

Hello,
Thanks for your reply. This is what happened.
I added the following in house contract: all mineral rights should be conveyed to me along with house. This is not the exact words, but with the same meaning. We didn't negotiate this lease sign in bonus when I bought this house. I didn't file any paper work with county office after this.
Would you please answer me the following questions? Thanks. 1. How to file paperwork with county office?2. Why I still need to file this paperwork even I said that all mineral rights should belong to me?3. Why I can't get any portion of bonus if I have mineral rights, which sounds unreasonable to me?
Thank you again,Joey

charles s mallory said:

Joey:

My first question is did you file the necessary paperwork with the Tarrent County Clerk's office in regards to the purchase of these minerals? If you failed to file this paperwork with the County Clerk's office, the previious owner will still be on record. I don't know what agreement was made between you and the seller of these mineral rights but I will guess that you probably won't recieve any lease bonus until a new lease is negotiated for these minerals. Again, if your purchase agreement included the bonus for these minerals, this would be a different factor in the deal. Have you got a copy of the lease which expired in August 2011? You will need to know if there was an extention clause. Your main objective at the present time is to make sure this lease is recorded in your name at the County Clerk's office.

#7

Yes Chesapeaker signed a mineral lease with previous owner. There is a website by Chesapeaker. From them, I knew lease has been expired this august. They said they will contact me if they are interested in leasing my property. Can I ask them provide previous contact? Also im not sure their reply indicate I’m the owner of mineral rights. Thank you for your reply. I appreciate it!

charles s mallory said:

Joey:

I live in Texas but my minerals are located in both Montana and North Dakota (Bakken Shale). I had to handle my legal matters on a long distance basis. I am somewhat familiar with the Barnett Shale but I don’t know any attorney’s in that area. Most likely, Chesapeake or XTO is still leasing in your area around Grapevine.

Joey said:

May I ask you which state do you live in now? Also in Texas?

charles s mallory said:

Joey:

When my mineral paperwork was filed with the County Clerk’s office, I hired the services of an oil and gas attorney, who filed this paperwork along with taking care of other legal matters regarding my minerals. All mineral ownership must be on file with the County Clerks office and this is the source for landmen or oil company reps to get the information on who owns the minerals. Again, the bonus would be yours if a new lease is negotiated and the legal staus is in order. My suggestion is to get some legal assistence on this matter in order to make sure all records are properly recorded.

Joey said:

Hello,
Thanks for your reply. This is what happened.
I added the following in house contract: all mineral rights should be conveyed to me along with house. This is not the exact words, but with the same meaning. We didn’t negotiate this lease sign in bonus when I bought this house. I didn’t file any paper work with county office after this.
Would you please answer me the following questions? Thanks. 1. How to file paperwork with county office?2. Why I still need to file this paperwork even I said that all mineral rights should belong to me?3. Why I can’t get any portion of bonus if I have mineral rights, which sounds unreasonable to me?
Thank you again,Joey

charles s mallory said:

Joey:

My first question is did you file the necessary paperwork with the Tarrent County Clerk’s office in regards to the purchase of these minerals? If you failed to file this paperwork with the County Clerk’s office, the previious owner will still be on record. I don’t know what agreement was made between you and the seller of these mineral rights but I will guess that you probably won’t recieve any lease bonus until a new lease is negotiated for these minerals. Again, if your purchase agreement included the bonus for these minerals, this would be a different factor in the deal. Have you got a copy of the lease which expired in August 2011? You will need to know if there was an extention clause. Your main objective at the present time is to make sure this lease is recorded in your name at the County Clerk’s office.

#8

Joey:

Most likely the paperwork did not reflect you as the mineral owner since the minerals have not been recorded. I don't really understand what your asking in regards to them providing a previous contact. I think the question is if the company is still leasing in that area and if not, who is obtaining the previous leases. Again, your main goal at this point is to get these minerals recorded and whoever is leasing the area will find you. Good luck!

Joey said:

Yes Chesapeaker signed a mineral lease with previous owner. There is a website by Chesapeaker. From them, I knew lease has been expired this august. They said they will contact me if they are interested in leasing my property. Can I ask them provide previous contact? Also im not sure their reply indicate I'm the owner of mineral rights. Thank you for your reply. I appreciate it!

charles s mallory said:

Joey:

I live in Texas but my minerals are located in both Montana and North Dakota (Bakken Shale). I had to handle my legal matters on a long distance basis. I am somewhat familiar with the Barnett Shale but I don't know any attorney's in that area. Most likely, Chesapeake or XTO is still leasing in your area around Grapevine.

Joey said:

May I ask you which state do you live in now? Also in Texas?

charles s mallory said:

Joey:

When my mineral paperwork was filed with the County Clerk's office, I hired the services of an oil and gas attorney, who filed this paperwork along with taking care of other legal matters regarding my minerals. All mineral ownership must be on file with the County Clerks office and this is the source for landmen or oil company reps to get the information on who owns the minerals. Again, the bonus would be yours if a new lease is negotiated and the legal staus is in order. My suggestion is to get some legal assistence on this matter in order to make sure all records are properly recorded.

Joey said:

Hello,
Thanks for your reply. This is what happened.
I added the following in house contract: all mineral rights should be conveyed to me along with house. This is not the exact words, but with the same meaning. We didn't negotiate this lease sign in bonus when I bought this house. I didn't file any paper work with county office after this.
Would you please answer me the following questions? Thanks. 1. How to file paperwork with county office?2. Why I still need to file this paperwork even I said that all mineral rights should belong to me?3. Why I can't get any portion of bonus if I have mineral rights, which sounds unreasonable to me?
Thank you again,Joey

charles s mallory said:

Joey:

My first question is did you file the necessary paperwork with the Tarrent County Clerk's office in regards to the purchase of these minerals? If you failed to file this paperwork with the County Clerk's office, the previious owner will still be on record. I don't know what agreement was made between you and the seller of these mineral rights but I will guess that you probably won't recieve any lease bonus until a new lease is negotiated for these minerals. Again, if your purchase agreement included the bonus for these minerals, this would be a different factor in the deal. Have you got a copy of the lease which expired in August 2011? You will need to know if there was an extention clause. Your main objective at the present time is to make sure this lease is recorded in your name at the County Clerk's office.

#9

I believe Mr. Mallory has given incorrect advice (which brings up the question of why people give advice when they don't know the answer to the question being posed), so I'll attempt to simplify. First, to the question of whether you own the minerals. The only document that dictates whether the minerals were transferred to you from the previous owner is the Deed that was executed to convey the property to you. Provided that the previous owner owned the minerals in question (which I'll assume to be the case), then the minerals would automatically convey to you UNLESS the Deed that conveyed the property to you specifically included a mineral reservation in favor of the previous owner. No other documentation will be/need be filed with Tarrant County other than the Deed - the Deed is what will govern whether or not the minerals were transferred to you. If by chance your sales contract specified that you would receive the minerals but your Deed includes a mineral reservation in favor of the previous owner, then you may seek recourse to revise the Deed to reflect what was agreed to in the contract. SECOND, to your question about whether you are entitled to the lease bonus if the previous owner signed the lease that you inherited via the sale, the answer is no. If you acquired the minerals along with the rest of the property, then you can benefit as a royalty interest owner on the existing lease, but you cannot retroactively gain a piece of the signing bonus. If the current lease expires, then you can sign a new lease and collect that bonus at that time. You needn't take any action to have the existing lease 're-filed' with the County - the lease will already have language that makes it valid for its term whether it is the lessor (the previous owner) or its assigns (you, in the case) who owns the minerals in question.

Hope this helps.

#10

A. Loren., I don't think Mr. Mallory gave an answer that was much different than yours......

Joey, you simply need to make sure your deed is on file with the county clerk, which it should be unless you signed separate mineral and surface deeds. Get a copy for your records if you don't already have one.

You then need to make sure a copy is sent to the company that leased the minerals from the prior owner. You want them to know you own it. Without notification, they'll have to figure it out when putting together the unit. The more obstacles they run in to, the longer the process takes.......

After that, it's a waiting game. Best case is they re-lease and drill a well. Worst case is they weren't able to get a drilling unit put together and it could be several years before they come back. Sub $4 natural gas isn't helping you either.

#11

A. Loren,

This really helps. Thank you! I was concerning that I have to hire an attorney to deal with lots of paperwork.

Joey

A. Loren said:

I believe Mr. Mallory has given incorrect advice (which brings up the question of why people give advice when they don't know the answer to the question being posed), so I'll attempt to simplify. First, to the question of whether you own the minerals. The only document that dictates whether the minerals were transferred to you from the previous owner is the Deed that was executed to convey the property to you. Provided that the previous owner owned the minerals in question (which I'll assume to be the case), then the minerals would automatically convey to you UNLESS the Deed that conveyed the property to you specifically included a mineral reservation in favor of the previous owner. No other documentation will be/need be filed with Tarrant County other than the Deed - the Deed is what will govern whether or not the minerals were transferred to you. If by chance your sales contract specified that you would receive the minerals but your Deed includes a mineral reservation in favor of the previous owner, then you may seek recourse to revise the Deed to reflect what was agreed to in the contract. SECOND, to your question about whether you are entitled to the lease bonus if the previous owner signed the lease that you inherited via the sale, the answer is no. If you acquired the minerals along with the rest of the property, then you can benefit as a royalty interest owner on the existing lease, but you cannot retroactively gain a piece of the signing bonus. If the current lease expires, then you can sign a new lease and collect that bonus at that time. You needn't take any action to have the existing lease 're-filed' with the County - the lease will already have language that makes it valid for its term whether it is the lessor (the previous owner) or its assigns (you, in the case) who owns the minerals in question.

Hope this helps.

#12

Thank you for your information. I will stop my Tarrant county to get a deed copy.


Joey

Dave Thompson said:

A. Loren., I don't think Mr. Mallory gave an answer that was much different than yours......

Joey, you simply need to make sure your deed is on file with the county clerk, which it should be unless you signed separate mineral and surface deeds. Get a copy for your records if you don't already have one.

You then need to make sure a copy is sent to the company that leased the minerals from the prior owner. You want them to know you own it. Without notification, they'll have to figure it out when putting together the unit. The more obstacles they run in to, the longer the process takes.......

After that, it's a waiting game. Best case is they re-lease and drill a well. Worst case is they weren't able to get a drilling unit put together and it could be several years before they come back. Sub $4 natural gas isn't helping you either.

#13

Dear Joey,

If no reservation of minerals were made, then you acquired whatever the grantor owned in the property as a result of that particular conveyance. No reservation certainly does not mean that you receive minerals, regardless of whatever any armchair quarterback might say.

It is entirely possible, if not likely, that the Chesapeake lease to the previous owner provided for an option to extend. If the lease is of record, it is your responsibility to see what rights were granted (and that you are subject to) and your responsibility to notify Chesapeake of the change of ownership (read the change of ownership provision in the lease to see the requirement).

#14

Joey,

Tarrant County real property records are online. You can get an "unofficial" copy of pertinent documents free of charge. A simple Google Search can locate the site for you.

Phil

#15