We signed paperwork 230 days ago to sell our mineral rights. 100 days later they sent a 3% check as good will while they checked out if we lawfully owned the mineral rights. according to our lawyer we do own them according to Ohio law. Is 230 days normal for this to not be finalized and they take ownership?
If you signed a deed, you may want to double check to see if it has been filed with the land records. Sounds like a long time to be held in limbo. Depending upon your agreement you may want to cancel the sale or give them a deadline. Use an Ohio attorney.
This post is not legal, tax or investment advice. Reading or responding to this post does not create an attorney/client relationship.
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I work for a Mineral Purchasing LLC and we normally pay within 30 days, as long as the Title is run and clear. If you signed the Mineral Deed, I hope you still have the original.
We do have an Ohio lawyer. We have contacted the oil company’s rep. He told us not to contact him as he would only speak thru our lawyer. We did ask our lawyer if we could back out and he said no. Plus we tried to add a deadline to no avail. It’s like we are in holding forever. And at their mercy.
My family contacted a lawyer in NM to clear up our title requirements for mineral rights owned in 2022. We are still fighting with Coterra to pay out our funds in suspension. It’s been a nightmare.
Did your lawyer review the agreement before you signed it and fail to set any deadlines for closing or termination? If you asked to set a deadline and were refused before signing, that should have been a red flag to terminate negotiations. Is there language that your acceptance of a partial payment acted to extend the term of the agreement? Or did that acceptance compromise your legal rights under state law? No one sends money as ‘“good will” but rather as a way to cement their rights under a contract. Is there a penalty clause if you terminate the contract? Consider getting a second opinion from another attorney about your right to demand the purchaser conclude the sale or release you. You may need to refund any payments received to date.
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You need a new attorney. Its the only gripe I have about this board, everyone suggests hiring an attorney 1st before doing anything, but when they do, they often come back on here asking about what their attorney did and asking questions. A mineral purchase should take no more than 45 business days to close. The fact your attorney signed off on whatever contract you signed and then took 3% owed after that much time, is quite baffling and would be enough for me to hire a new attorney Monday or 130 days ago! But, the big question is, how many acres are you selling/expected profit from the sale? If its a tiny mineral interest, then obviously dont want to spend more money on it, if you are expecting 6+ figures, then you need to act fast.
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Bob, It is not clear that they consulted an attorney before signing the contract provided by the buyer. If they did, then either the attorney did not build in adequate protections or they signed despite his warnings. Sometimes people sign documents because they like the agent on the other side and just hope it goes well. The buyer sent 3% payment to the seller stating it was “good will.” No idea what they have paid the attorney.
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Well the wait is over. The oil company found a previous owner of our mineral rights from 1919. Which with the way Ohio Law is written should be considered abandoned but when my father in law inherited the farm in 1966 his Mother mentioned that the original owner had the mineral rights. But nothing was utilized. Well the Oil company tracked down a great great grandson in virginia, told him he owned the mineral rights and had him send to the Jefferson Court House his intent to keep the mineral rights. So the money we had negotiated with the oil company for all goes to him. Plus Surface owners in Ohio have no rights at all. Him and the oil company can come onto the property. Tear out all our timber so he can get to his minerals and we have no say. We have no rights. We have no say. Plus the surface value of the land is now devalued from $6500 an acre to $1500 an acre…We are the loser here…Our attorney says we are screwed all the way around and can’t even recoup the mineral tax money we have been paying on the property since 1919…how’s that for the law protecting a land owner???
@MistyRose - Misty, your questions and arguments don’t match what you presented in this post. You mentioned you are selling the minerals, but there’s a difference between leasing your minerals and selling them. If you are selling the minerals, was it to an oil company (drilling operator) or a mineral investment company? You also state in your closing post that an heir of the minerals “great-great-grandson” can now negotiate with the oil company to come onto your property, remove your timber, and take his minerals. That sounds like you received an offer to lease the rights, not to sell them. Laws in each state regulate entering properties. Jefferson County, OH is a lot like the State of West Virginia and tax assessments which are a total nightmare since the beginning of oil and gas development. I would reach out to the tax office and see if you can present them with a title abstract showing you are not the mineral owners. Hire an oil and gas attorney to have title certified if you are going to argue the title. The oil and gas industry, along with title abstracts, is very complex, and the risks are high for both owners and operators. Just because you think you owned the rights in 1966 doesn’t matter until you run the title back to Patten (the beginning of the land to be deeded the first time in history). It’s essential to verify your facts before sharing them so others can assist you effectively.
I’ve seen people have an oil and gas lease and beside it and they are looking at the check and not watching where they are signing the lease! They just want the money NOW! Ha! Ha!
Sorry to hear how this turned out. When the minerals were severed 100 years ago, no one anticipated modern drilling and development. And that is a serious problem for surface owners in states where an operator does not have to compensate surface owner or agree to put a well pad in a corner. You should research to see if you have right to payment for timber at least. The only remedy is legislative to force compensation or limitations, which pits surface owners against mineral owners.
Bob, very well said.
Ohio’s handling of this has been a bad deal all around regarding the minerals reserved in the early 1900’s in my personal opinion. They tried to fix the problems by 2 Dormant Mineral Acts in the late 80’s and and mid 2000’s where the surface owners or any heirs could file notice of claims to obtain the minerals. By that time, the people that sold the property over the 80 years were impossible to find so the heirs had no idea about the property listed and notice to claim to the minerals filed in the tiny towns local newspapers largely went unaswered.
A company will not just come on your property and rip out the timber to get to the minerals, they will either pay you for access to the well pad or drill a well that goes under your property that you will never see.