Contract law is exactly what I think.
If someone files a Memo of lease that is bogus, the lessor can file something in return giving notice of that.. There is no valid lease if the agreed upon consideration is not paid by lessee.
If I was satisfied that the lease filed of record was bogus, absolutely would I try to take another lease. In a New York minute.
Sir you are a wealth of knowledge ,I can only hope that between the money out of mine and R W 's pocket for attorneys fees and his investment in a subscribtion to a law library we can be nearly as knowledgeble as you.You sir are truly, Wiley Coyote super genius, and we are the lowly roadrunner.I bow to your omnipotent knownedge
Dave Quincy said:
Contract law is exactly what I think.
If someone files a Memo of lease that is bogus, the lessor can file something in return giving notice of that.. There is no valid lease if the agreed upon consideration is not paid by lessee.
If I was satisfied that the lease filed of record was bogus, absolutely would I try to take another lease. In a New York minute.
Dave, you are misstating here, the purpose of the Memorandum of lease is to give constructive notice, it is not for the mineral owner lessor to aknowledge to the lessee/oil company that a lease exists. The lease itself does that. And your saying that the whole purpose of the memo of lease is for that reason, is disingenuous. I'm not buying it.
Dave Quincy said:
I have never seen a memo of lease not signed by Lessor. It wouldn't make any sense otherwise. They are the only one who has the legal standing to sign one. The whole purpose is for the mineral/owner lessor to acknowledge to lessee/oil co. that a lease has been executed with a certain primary term, and that basically the other terms of the lease will not be made public record. The lessee might sign it also, but it is the lessor who executes it.
I thought the memorandum was used by oil/gas companies to hide details of the actual lease.
Dave, you also said the lessor is the only one who has legal standing to sign one, meaning a memorandum of lease. Either party to a contract can record a notice that a contract exists. The mineral owner /lessor is not the only one who has standing. Yawn.
If I ever see one where the lessor isn't on the instrument, I think I may call the last lessor of record to see if his land is presently under lease.
You sure do spend a lot of time on this forum to be bored where it makes you yawn.
I think it's your entire life.
Dave, it's just correcting your misstatements that I find boring.
That's impossible. I never make any.
See above.
Dave Quincy said:
That's impossible. I never make any.
Oil companies aren't that stupid. They don't file memos of leases saying hey look everybody, we have a lease on blackacre, and then have the V.P. of land sign it. They have the mineral owner/ lessor execute both the lease and memo. That way, even skeptical folks like you would have to believe that they actually do have a lease covering blackacre, because the mineral owner/lessor's signature will be on the instrument.
Why on earth would I sign a memorandum of lease? Sounds like just another freebie, you should pay my legal and notary fees. Presumably I would have my money, you say you always pay for the lease after confirming title, before you present the memorandum of lease? If I gave you an executed lease, I'm not going to sign anything else for you if you haven't paid for the first one yet. You aren't one of those deadbeats, are you? Why would I sign, I am leasing acres not looking for an office job? I don't sign anything I don't have to. Sounds like office work to me and I don't work in your office. You can't force me to work for you, that would be slavery. I tell you what, leave the memorandum of lease with me and I will scan it and e-mail it to my lawyer and see if he thinks I should sign it.
In my opinion, people should not sign anything you don't absolutely have to, be it memorandum of lease, ratification, division order if you are a state that does not require that you sign and return one.
I had a friend who thought he was having a child with his girlfriend, turns out it wasn't his, but he had signed the birth certificate and the mother took the baby and moved to Ohio, received welfare and had to name the father. My friend went to Ohio and demanded a paternity test and it proved he was not the biological father, but he signed the birth certificate saying he was the father so he gets to pay child support for another 8 years now. Don't sign anything. The birth certificate would have been just as valid without his signature. Just saying.
Maybe people sign them for privacy reasons. The memo doesn't show any terms or provisions.
There would be little for a lawyer to review. No terms are stated.
You make it seem like the memo is always the idea of the lessee. It isn't.
Why would I care if anyone knew what royalty I received? In my opinion the only thing that might be worth keeping private in a lease would be my address and the address would be on the memorandum of lease. Really my address doesn't matter because I get junk mail wanting to buy my minerals all the time anyway. I have enough barbeque starter already.
To a great extent, I can't help it if people can't see that secrecy only helps the lessee and the oil industry and possibly some landmen that work for mineral owners, but I think for the greater good of the average mineral owner, that the terms should be visible and searchable. I wish you could just Google it.
I will go ahead and say it here though because someone might read it and heed it. At the head of each group is usually a request to share information. Frequently, the first post in a group from any new member is a request for the most up to date terms. If I leased for 25%, 3 years, $10 and more cash in hand, it wouldn't bother me for everyone on the planet to know and I hope I would have already discussed it with all my neighbors before they leased. If someone was really interested, I'd really like them to be able to see.
Dear Bob,
In most states that I am aware a Memorandum of Lease only imparts inquiry notice.
Up until fairly recently, Memorandi of Lease in Louisiana (properly titled Notice of Lease, but nobody is that proper anymore) were declared not valid by the courts, but later made valid by act of legislature. The courts' reasoning was that if no words of grant were contained and at least a summary of provisions, it was ineffective to impart any valid notice whatsoever. The legislature straightened that out probably 4 or 5 years ago.
Like the saying goes, you can file for record a grocery list as long as the elements are present to satisfy the recording statues of that state.
And yes, to impart inquiry notice a Memorandum of Lease can be declared by, executed by and/or filed by any part to the contract and I have seen plenty that only the Lessee signed. Swift Energy did it a lot - Goliad and Bee County come immediately to mind. No big deal.
Having said that, we are talking about a document that has no standard, so each document stands on its own.
r w kennedy said:Why would I care if anyone knew what royalty I received? In my opinion the only thing that might be worth keeping private in a lease would be my address and the address would be on the memorandum of lease. Really my address doesn't matter because I get junk mail wanting to buy my minerals all the time anyway. I have enough barbeque starter already.
To a great extent, I can't help it if people can't see that secrecy only helps the lessee and the oil industry and possibly some landmen that work for mineral owners, but I think for the greater good of the average mineral owner, that the terms should be visible and searchable. I wish you could just Google it.
I will go ahead and say it here though because someone might read it and heed it. At the head of each group is usually a request to share information. Frequently, the first post in a group from any new member is a request for the most up to date terms. If I leased for 25%, 3 years, $10 and more cash in hand, it wouldn't bother me for everyone on the planet to know and I hope I would have already discussed it with all my neighbors before they leased. If someone was really interested, I'd really like them to be able to see.
These kind of logistical issues can easily be remedied by tendering a bank draft conditioned on receipt of the signed lease only or by enlisting an escrow agent near the lessor.
Dave Quincy said:
What if the lessor is in Afghanistan? Should the oil company mail the check first, and hope that it gets returned, or would it be wiser to send check upon receipt of lease?
They could cash the check and never return the lease. If signed lease is returned, and check isn't mailed back, then the lease would fail due to a lack of consideration.
If the agreed upon consideration isn't forthcoming, then there is no valid lease. If they file it, the mineral owner can file something giving public notice that no consideration was received, and that the tract is open for lease.
It's not quite that simple. First, leases almost uniformly state that the consideration is a nominal sum (i.e. $100) and "other valuable consideration." Without any specificity as to what the consideration of the contract was supposed to be, it is impossible to make a legal conclusion as to whether consideration was given.
Second, whether consideration exists is a question that involves both legal and factual conclusions. But an Affidavit can only contain statements of fact. So, A Lessor cannot unilaterally declare what the lease's (unstated) consideration was after the fact, nor can he make a legal conclusion as to whether there was consideration for the contract.
The Lessor can execute an Affidavit that bonus was not paid, but that does not preclude all possibility that some "other valuable consideration" was given. What's more, almost all leases will have language that the "receipt and sufficiency of which (consideration) is hereby acknowledged" or something similar. When a lessor signs a contract saying that they've received consideration, it is difficult for them to later claim that the consideration was not in fact received. Either way, the lessor's affidavit would do little or nothing to uncloud the title.
There is also a criminal angle. Taking and filing leases without making payment where there was a promise of consideration may constitute fraud.
A person making a promise to pay a bonus (or do anything else) that he fails to perform is not fraud, it's a breach of contract. At worst the person may be in legal bad faith which carries civil consequences. Fraud requires a misrepresentation or omission of a material fact.
Buddy,
Louisiana's statute regarding Notices of Lease was first enacted in 1986. The statute applies retroactively to any instrument previously recorded that is in substantial compliance with the statute, and the instrument is effective against third persons from the date of recordation.
Buddy Cotten said:
Dear Bob,
In most states that I am aware a Memorandum of Lease only imparts inquiry notice.
Up until fairly recently, Memorandi of Lease in Louisiana (properly titled Notice of Lease, but nobody is that proper anymore) were declared not valid by the courts, but later made valid by act of legislature. The courts' reasoning was that if no words of grant were contained and at least a summary of provisions, it was ineffective to impart any valid notice whatsoever. The legislature straightened that out probably 4 or 5 years ago.
Like the saying goes, you can file for record a grocery list as long as the elements are present to satisfy the recording statues of that state.
And yes, to impart inquiry notice a Memorandum of Lease can be declared by, executed by and/or filed by any part to the contract and I have seen plenty that only the Lessee signed. Swift Energy did it a lot - Goliad and Bee County come immediately to mind. No big deal.
Having said that, we are talking about a document that has no standard, so each document stands on its own.
Best
Buddy Cotten
Mineral Manager
r w kennedy said:Why would I care if anyone knew what royalty I received? In my opinion the only thing that might be worth keeping private in a lease would be my address and the address would be on the memorandum of lease. Really my address doesn't matter because I get junk mail wanting to buy my minerals all the time anyway. I have enough barbeque starter already.
To a great extent, I can't help it if people can't see that secrecy only helps the lessee and the oil industry and possibly some landmen that work for mineral owners, but I think for the greater good of the average mineral owner, that the terms should be visible and searchable. I wish you could just Google it.
I will go ahead and say it here though because someone might read it and heed it. At the head of each group is usually a request to share information. Frequently, the first post in a group from any new member is a request for the most up to date terms. If I leased for 25%, 3 years, $10 and more cash in hand, it wouldn't bother me for everyone on the planet to know and I hope I would have already discussed it with all my neighbors before they leased. If someone was really interested, I'd really like them to be able to see.
Not all mineral owners are so open. I have even seen it in body of lease itself where it states that a Memo had to be filed, and not the actual lease. What choice do you have then?
Bringing drafts into it as was done above has nothing to do with the discussion. The lady was promised a check in return for a signed lease. She received it
If a check is promised and not delivered, there is no valid lease. It's not that complicated. Fraud could enter into it, depending on what actions the non-paying lessee takes with signed lease that he records and doesn't pay the agreed upon consideration.
99.9% of all memos are signed by the lessor. I'm not blind. I see them all the time.
Cotten's reply was non-responsive to the discussion that rw and I were having. rw was alleging that the Lessor doesn't or never executes the memo. That is incorrect. They typically do.
I didn't say a lessor never did sign a memorandum, I said a lessor does not have to, and the memorandum is still valid notice if recorded by the lessee alone. Keep trying, there may be an acorn out there in the forest somewhere, but if you are going to attribute something to me, please keep it factual.
Since you are going to use such tactics, you said that the lessor was the only one to have standing to sign the memo. You then said that the whole purpose of the memo was for the mineral owner/lessor to acknowledge to the lessee/oil company that the lease exists, you could not be more wrong. I believe you could do far better than this. Please answer why you think the only one to have standing to sign a memo of lease is the mineral owner/lessor? Also please tell why you think the whole purpose of a memo of lease is for the mineral owner lessor to acknowledge to the oil company lessee that the lease exists. I'm willing to learn but you haven't shown me anything yet.
Andrew! Holy Smokes. How time flies when you get older. Thanks a million.
Buddy
Andrew said:
Buddy,
Louisiana's statute regarding Notices of Lease was first enacted in 1986. The statute applies retroactively to any instrument previously recorded that is in substantial compliance with the statute, and the instrument is effective against third persons from the date of recordation.
Buddy Cotten said:Dear Bob,
In most states that I am aware a Memorandum of Lease only imparts inquiry notice.
Up until fairly recently, Memorandi of Lease in Louisiana (properly titled Notice of Lease, but nobody is that proper anymore) were declared not valid by the courts, but later made valid by act of legislature. The courts' reasoning was that if no words of grant were contained and at least a summary of provisions, it was ineffective to impart any valid notice whatsoever. The legislature straightened that out probably 4 or 5 years ago.
Like the saying goes, you can file for record a grocery list as long as the elements are present to satisfy the recording statues of that state.
And yes, to impart inquiry notice a Memorandum of Lease can be declared by, executed by and/or filed by any part to the contract and I have seen plenty that only the Lessee signed. Swift Energy did it a lot - Goliad and Bee County come immediately to mind. No big deal.
Having said that, we are talking about a document that has no standard, so each document stands on its own.
r w kennedy said:Why would I care if anyone knew what royalty I received? In my opinion the only thing that might be worth keeping private in a lease would be my address and the address would be on the memorandum of lease. Really my address doesn't matter because I get junk mail wanting to buy my minerals all the time anyway. I have enough barbeque starter already.
To a great extent, I can't help it if people can't see that secrecy only helps the lessee and the oil industry and possibly some landmen that work for mineral owners, but I think for the greater good of the average mineral owner, that the terms should be visible and searchable. I wish you could just Google it.
I will go ahead and say it here though because someone might read it and heed it. At the head of each group is usually a request to share information. Frequently, the first post in a group from any new member is a request for the most up to date terms. If I leased for 25%, 3 years, $10 and more cash in hand, it wouldn't bother me for everyone on the planet to know and I hope I would have already discussed it with all my neighbors before they leased. If someone was really interested, I'd really like them to be able to see.