The family has received Division Orders for leased property that oil production has begun. Hooray!!! One big problem, there are several tracts in the 640 acres, we agree with the acres and the Decimal Interest on all but one tract. We have tried to straighten this up with the Oil Company, but to no avail. We used an attorney who presented in our favor, that Case Law would support our position on the NMA and the Decimal Interest amount. I don't know if the Oil Company is choosing to ignore this because it is not favorable to them (i.e. They would have to pay more $$$ to us as the Mineral holders) or if the attorney just wasn't very good in convincing the oil company and has not followed up properly and promptly. (And besides, it's not his problem and "all attorneys" are horribly busy)(lol)
Is there some kind of a 3rd party, like the OCC that could be used to straighten out what the actual NMA and Decimal Interest amount is if we can't come to a mutually agreeable solution??? The difference will cost the family $$$thounds$$$ if not corrected. Should we try to set up an appointment with the Legal Division (or who?) of the Oil Company??? The Oil Company just wants the family to "accept" the Division Order as is. Can we accept the Division Order as is and have it corrected later when all the facts and circumstances could be properly presented to the correct person???
Thanks for all your help. I appreciate any comments or suggestions.
The Company is almost certainly relying on a Division Order Title Opinion that was prepared by a third party attorney. It is that third party attorney who needs to be convinced.
I wouldn't sign a D.O. that I believed to be incorrect. You don't say what State you are in, but in most I don't believe you are required to sign a Division Order to get paid. If you do ultimately prevail, they will have to pay you all the way back to Day 1.
I would start by contacting the in-house landman to determine why they think your interest is correct rather than your calculation (I agree with Steve--they usually just go off the DOTO from an attorney). Which operator is it? I agree not to sign a division order until the interest is correct. Most states have specific statutes as to exactly what is the minimum acceptable documentation operators can expect for owners to sign. After all, it is your property and you should (in theory) know what you own--the issue is that many operators use the division order document to implement unscrupulous terms onto unsuspecting interest owners amending the terms of the lease and/or allowing additional deductions from your revenues. I am happy to help more if you want to PM me. Good luck!
Hire your own independent landman to calculate the NMA and decimal interest amount and see if it agrees with the in-house landman. If it doesn't and it's in your favor, hire an attorney who is familiar with your independent landman's work. You can go to your County Court house and ask for names of independent landmen and contact them and ask what attorneys use them. Also, you can contact local attorneys and ask who they use. Don't sign anything until it's correct.