Has anyone heard of an oil company not expecting an Affidavit of Heirship?
Not sure I understand your question … “expecting”? You mean not recognizing, not accepting an Affidavit of Heirship? Did you question your Division Order Analyst, how did they explain it?
I’ve heard of operators not wanting to rely on Affidavit of Heirship if such AoH was recorded in county records less than five years ago, because an AoH is inferior to a probated will. AoH can be prepared by a self-serving insider, possibly challenged by a surprise claimant. In such cases, expect the owner to record some other type of probate document in the county records.
I’m not a lawyer, would be nice to hear attorney perspective.
I am a heir and I have filed 3 Affidavits of Heirship; Cimarex Oil Co will not accept them. AoH was prepared by a lawyer and filed months ago.
Lawyers might offer insight if you retitle your post “Affidavit of Heirship”, or start a new post with Affidavit of Heirship in the title.
If you paid a lawyer to prepare/file your AoH, call and tell him/her what Cimarex said.
What did Cimarex Division Order Analyst say? That Cimarex doesn’t want to rely on AoH recorded recently (less than five years)? Did they tell you to obtain some intestate succession documents from the county(ies) of death, and file them in the county where your well is located?
Usually an Affidavit of Heirship will only be accepted after 9 years of the decedent’s death; beforehand they prefer the estate to be probated. An issue I have run into is that if there is a lot of money coming to a property, the operator will not accept an affidavit of heirship because it’s not as concrete as a probate. Now if there is minimal production/proceeds coming to a property, they will usually accept an affidavit considering they wouldn’t be out too much money.
1 Like
It has been well over 9 years since my grandfather’s death.
Each company has different standards. An Affidavit of Heirship does not transfer ownership; it is simply a piece of paper that has one or two people stating who the heirs are. Once it has been filed for 5 years, then it is acceptable in Texas. If the ownership is low or the money is under the company’s threshold, then many will accept them just as minimal risk.
Landman here. Who is the affiant of your AOH? Typically an operator’s drilling title opinion will require an AOH to be executed by at least two disinterested parties who can swear to the facts and family history of the affidavit. Your AOH carries less weight, and may be rejected, if it’s self-serving.
Every company is different. And it also depends on the number of acres you own. For example - if you own 100 NMA in a unit, you’re one of the large mineral owners. Most likely, the company will want you to put everything through probate, because that’s the only way to transfer ownership into your name. Until it’s in your name, they can’t be 100% sure you own. And until it’s in your name, they probably won’t pay any royalties. However, if you have 1 NMA, it may not be worth their time or worry to have you do all that, and they will accept an affidavit. In order to get these into your name or ever sell them you will have to go through probate, in every state you own in.
1 Like
If they will not accept your AOH, it may be because: 1. The affiant is an interested party, such as one of the children of the decedent; or 2. The amount of money involved is greater than a certain amount (in my experience $5,000 is the limit of business risk an oil company will accept without probate). You can always contact Cimarex and ask them what the problem is - their division orders department should be able to explain the problem. There could also be gaps in your chain of title and additional AOHs may be needed - are you saying they won’t accept the ones you provide (reject them based on some problem) or they are saying “this AOH is not sufficient to clear your title and allow us to begin paying you”?
1 Like
It is a straight line to me there is no probate. I have called Cimarex and spoken with the analyst and no they do not take AOH whatsoever. They stated they needed a Jurisdictional Decision???
Did the person who currently owns the interest (who died) leave a will? Probate is the process of distributing the assets of the decedent to the heirs according to their will, so if there was no will left by the decedent, the oil company will usually accept an AOH if there is below a certain amount of money involved. If the decedent’s account has a large sum of money and the oil company improperly distributes that money to what they believe is an heir based on an AOH, they are liable to the rightful heir to make them whole (hence the requirement for it to be a small amount for them to take the business risk). Even if you are the only heir (no brothers/sisters, no one contesting anything, etc.) they may not take AOH if there is a will involved, in which case probate would be required. That is really weird that an oil company would refuse all AOHs because how would they be able to pay revenue in small, intestate (no will left by decedent) cases? They don’t want to sit on suspended royalties. Do you have an attorney?
1 Like
There was no will and no brother or sisters. Also, I have been paying taxes on the mineral rights.
I have 2 of them by different people, different states, and has no interest in the mineral rights.
Your frustration is evident in your posts. Apparently Cimarex does not find that the AOHs are sufficient to establish clear title into your name. Paying taxes does not establish title. From your posts, it seems that there are two layers of title - from Grandfather to his heir(s) at law and then from those heir(s) to you. Based on your phone call, Cimarex wants you to file in the court and get a judgment to establish your title. You or your attorney needs to contact Cimarex landman and legal and request the portion of the Drilling Title Opinion or Division Order Title Opinion which discusses your title deficiency issues and then you can address that directly. Maybe there are others who have a claim or who have made a claim. You will likely need to file a lawsuit to establish title by showing the title held by your grandfather, how title passed through your parent and to you - such as your mother was an only child and you are the only child of your mother. Did your mother or father die before or after your grandfather? Were there debts outstanding at your grandfather’s death and so others have a claim? There are clear procedures and requirements for such a lawsuit. This will cost you some money. You will need to hire an experienced oil and gas title attorney.
1 Like
That’s what I’m thinking also - if they have less than a certain threshold (dollar value) in suspense, Cimarex should have been willing to accept an Affidavit of Heirship to allow them to pay on an intestate estate, but this situation may exceed their allowable threshold. The heir can call Cimarex and ask how much money is in suspense - if you find out it’s quite a lot and therefore they want legal action to establish title, it will be worth hiring an attorney to handle.
1 Like