Erroneous Payment

I was contacted by a company to lease mineral rights I apparently own in Colorado. I signed a 5 year lease and was paid the up front payment. I have since had my mineral rights searched by a local title company to ensure that I do not own more than the 1/2 interest the Oil company said I owned. The title company searched the records and found that I do not in fact own any minerals or at least that is their opinion.

So, if the title company is correct and I do not own any mineral rights on the tract and have been paid what are the reprecuccions? Can I be sued? Is this just a sunk cost of the oil company since it was their mistake? What if the "real" mineral owner tries to lease the 100% share they own? I am afraid this could get messy.

Any advice?????

Depends–did you warrant title in the lease? If you did, then you will likely have to pay it back. If you did not warrant title, the money is yours to keep.

I wouldn’t lose any sleep over it. From the broker all the way back to the client, no one is going to admit they bought a bad lease. If a lawyer preparing a title opinion on the leased tract, which would be the only way they would ever know they bought a bad lease, were to realize the lease was bad and they should take leases from someone else, you would never hear about it. It’s a cover your ass kind of business and there’s never good PR suing lessors for repayment of bonus money.