HELP, Supposed to close and have problems on sale

Hi, everyone. I have some concerns I hope all you helpful people can assist me with. I am in the process of selling some mineral interests I own. The entity buying sent me and I signed an Offer of Purchase. We are supposed to close this transaction this coming Tuesday. Let me add that this is a 1031 exchange, not that that matters, but it might explain why things have gotten so confusing with papers being sent back and forth. The Buyer and the 1031 intermediary both have the .PDF Deed I am to sign in front of a notary. I do not.

In reviewing my documents today (Sunday) for the upcoming closing this Wednesday, I realized, (1) My attorney and I are the only ones that do not have the Deed. (2) The Offer of Purchase I signed has an erroneous legal description. It reads: “An undivided 1/12 interest in the southern 160.08 acres of the E/2 of Section 1, Block 34,” such and such survey, with the correct abstract number, county, state, “containing 160.08 acres, more or less”

It should read, in my opinion:. “The S/2 of the E/2 of Section 1, Block 7,” such and such survey, with the correct abstract number, county, and state.

I would be willing to bet big bucks that the deed everyone has but me and my attorney has that erroneous legal description.

The Buyer has told me I need to sign and overnight the notarized deed to them as of tomorrow in order to fund the sale.

I am supposed to meet with my attorney Tuesday afternoon at three p.m., which would be after I sent the notarized copy of the deed to the buyer.

Now, I’m not the brightest bulb in the room, but I don’t feel I should sign a deed selling someone else’s​ property or sign a deed that my attorney has not reviewed.

No one has told me they have contacted the abstract company I sent them the name of for our closing. I have alerted everyone involved that I am not well versed in how this all works. The Buyer told me they have done their due diligence but now I’m concerned about that.

I would sincerely appreciate it if any and all would let me know what you think about how I should proceed from here. I want to complete this transaction and have acted at all times in good faith. I should have caught the typo in the erroneous block number, even though the abstract number and all else was correct.

Sorry for the length of this post, best I could do.

You cannot sign a deed with a bad legal description. And certainly you and your attorney shoulld both review the deed before it is signed to not only make sure the legal description is correct, but to make sure that it does not contain legal language that is more extensive than it should be or includes other property in the same county. You should not rely on either the abstract company or buyer to prepare a deed without review.

Thanks, TennisDaze. As of five minutes ago they are trying to force me sign and overnight a deed they say they will correct and email me tomorrow.

Immediately forward the deed to your attorney for review. If these are reputable buyers, there should not be a problem but it is always wise to protect yourself. You may be under a time limit for the 1031 exchange that makes Tuesday or Wednesday the final day for this transaction. You cited both days in your post. Is that the reason for the pressure? You should check first thing in the morning with the abstract company about the closing process and to make sure everything is on track. Are you going to be present for the exchange of the deed for the proceeds (or for proceeds being sent to the intermediary)? Are the funds being deposited with the abstract company or directly with the intermediary? By abstract company, do you mean a title company - although the buyer has done its own title research. Are you giving a full warranty, a special/limited warranty or no warranty of title? Make sure you understand the difference. Are you reserving any related revenues which have accrued up to the effective date of the sale or are those proceeds, if any, going to the buyer? You and your attorney need to carefully review the letter agreement that you signed and the deed.

Thanks again, TennisDaze. I have been told these are reputable buyers by people that you and I both know and have for some time. My attorney agreed to see me on very short notice, which appointment I have and was lucky to get, Tuesday afternoon. As I stated, I do not yet have a deed at all, or a corrected deed, if it has the same erroneous legal description as the Offer of Purchase; they said they would get it to me tomorrow. I’m doing a double relinquish in the 1031 exchange and this is the first of the two sales, so my time is not yet running, thank God. I told the Buyer, who was preparing the deed, the name of the abstract/title company we could work through here. Tonight the Buyer’s landman said he didn’t know anything about “MY CLOSING” but they needed the signed, notarized deed in their hands to fund and to overnight it to them tomorrow.

I have told them I do not feel comfortable with the way this is proceeding, that the funds need, at the very least, to be placed in escrow with the intermediary, and that then, and only then, will I sign a CORRECT deed.

The first house I ever contracted to buy as a femme sole in 1989 was being sold by a Captain of a ship and his wife so they could put their kids through school. At the time of closing, on a Friday, the Captain was at sea and the wife did not want to sell. All my belongings were packed and ready to move and the place I was residing would no longer be available to me. At closing, said wife refused to grant possession and I had nowhere to live. I was a court reporter and had a jury trial starting Monday. The $500 good faith money I paid into escrow is still, to this day, in the coffers of the State of Texas…

TennisDaze is very polite in her warnings. Take heed.

My definition of a "reputable buyer" is a buyer that delivers the funds in an agreed upon amount in exchange for an executed deed. If your buyer doesn't meet the definition, find another buyer who will. There are many out there.

Your attorney should be able to exchange the documents.

Gary L Hutchinson

Thanks, Gary. A 1031 exchange is not the easiest thing to accomplish. Linton

So now I have another question. The language on the last page of my deed reads:

“Executed on the date of Grantor’s acknowledgment, according to the certificate appended hereto, but effective as of May 1, 2017.”

I’m thinking it needs to be “effective” as of the day of closing, May 24, 2017, for my time to start running under the terms of the 1031 exchange, otherwise I’ve already lost half my 45-day period to find my replacement property and over three weeks of the time I would have to close on that replacement property.

Anybody have any thoughts on this? Thanks, Linton

1031 exchanges are a special situation and so you may well be correct. That is a question for your CPA or attorney. The buyer wants the effective date to be May 1 so that the buyer gets the royalties for all production starting May 1. It is more difficult to measure production in the middle of the month, such as May 24, but you and the buyer can simply agree to some split. Good luck finding an exchange property.

Thanks, TennisDaze. I’d be glad to sign my May royalty check over to them to not have to worry about the deed language as far as IRS is concerned with doing the 1031…!!

Did the Offer to Purchase not include a form Mineral Deed as an Exhibit? You should absolutely have your attorney review the document to ensure they aren’t adding “global catch-all” language that they aren’t paying you for. If it falls through, there are lots of buyers out there. It isn’t a big deal for them to have you close on the beginning of the month and have the effective day match–it’s a good catch that the 1031 click may be impacted by a back-dated. Do you have your property already picked out?

Hi, Jimmy. The original deed was sent to the intermediary instead of to me. But that became a moot point because the legal description in both the Offer of Purchase and the Mineral Deed was incorrect. They FINALLY agreed this afternoon to change the date to be effective as of June 1. I’m seeing my attorney with papers in hand tomorrow, but think we’re good to go at this point. No, sir, I’ve been so busy trying to get everything corrected, I haven’t had time to pick out my replacement property yet. I appreciate your response, thanks for your time.

An "effective" date is the date both parties sign the offer. The offer becomes a contract after both parties have signed. That's how it is in real estate.

Good luck,


Thanks, Pat. I was just unsure since I was signing the document on May 23, but it specifically set out in the paragraph above my signature that the “effective date” would be May 1. Being as this is a 1031 exchange, I just didn’t want any question about when my 45-day time limit would start to run. They finally agreed to make that change and I signed it May 23, “effective June 1” so all is good. Thanks for everyone’s time and attention! Linton

In addition to everything others have said, it's our experience that whenever someone makes an almost impossible deadline they are pulling a fast one. A reputable buyer is not going to give you something like 24 hours to sign papers and demand that they be sent back to them overnight. It's a ploy to scare you and keep you from getting legal advice.


This is a seller's market. That means you get to set the rules.

  2. Provide buyer with reasonable amount of time to check title. The good ones will use their own attorney's and CPL's (I always get a copy of the TO)

Pat is usually right but she is wrong about the "Effective Date" in a mineral sale because of royalty provisions.

Gary L Hutchinson