For everyone in these discussions....
Do NOT do business with Ferrell Oil out of Oklahoma City. We had an offer to purchase minerals in Grady County, 11-03-06. Jim Meyer with Ferrell said he represents a college endowment fund and wanted to purchase our property for the school. We negotiated a purchase contract with them and was asked to fax it to them with our signature so they could show it to the school to get funding to close the purchase. He said it would take 30 days to do a title opinion. They, however, never did sign the contract and return it to us.
As it turns out, they are a broker and do not purchase property for their clientele rather than look for a buyer once you agree to sell to Ferrell Oil. They will want to issue you a 30 day bank draft and if they can't find a buyer for your property in those 30 days, they just don't pay the draft. We negotiated to be paid by ACH/Wire Transfer.
We will find another buyer but DO NOT do business with Ferrell Oil out of Oklahoma City unless you want to sit around, be lied to and then never get the deal closed.
Also be wary of them doing business under another name.
That is common practice for many buyers.
It sounds like you played into their hands. You could have told them to take their 30 days, and when they had the title opinion to cut you a cashier's check.
You let them play you.
Dave, you are correct, Ms. Wood got taken in. Not unusual for mineral owners. I was taken in back in the day when I didn't care a thing about mineral rights. Nobody likes the embarassment of saying they were taken in. Many mineral owners would be silent rather than to admit it and that makes Ms. Wood special in my book, for coming here and telling her story, to help others to avoid the same mistake. Dave, you gave great advice. I am sure that I am guilty of this myself but the artist doesn't always know when a work of art is finished.
Dave Quincy said:
It sounds like you played into their hands. You could have told them to take their 30 days, and when they had the title opinion to cut you a cashier's check.
You let them play you.
Removed by MRF Administrator due to violation of our TOS.
This seems like a curious story to me. As Mr. Tom Moore has commented, this sort of practice is common for many buyers. By "this practice" I mean, the issuance of a "draft" as a kind of marker keeping the deal in place until the deal is actually consummated. Mr. Quincy is correct; if the buyer hasn't finalized the deal and come through with the agreed-to price within 30 days, the deal is off. For that matter, it seems to me that this "draft" doesn't constitute a contract. Ms. Wood's mistake, perhaps, was signing the contract without getting Ferreloil's signature. But as long as both parties hadn't signed, there was no contract, and Ms. Wood have been free to find a better deal during those 30 days and taken that better offer. Maybe there's an attorney out there who can contradict me on this, I'd be curious to find out. I'm interested since Ferreloil is one of the companies I've contacted about selling some of my interests, I've found that The Better Business Bureau gives the company an A+ rating with 0 complaints and 0 issues. Did Ms. Wood contact The BBB?
Ms. Wood has done a service in warning mineral owners not to just believe a story as presented. Her point was that she believed that a particular college wanted to buy her minerals and that she was selling to a charity and the sale would be consummated in 30 days after title was confirmed. Instead she says that the agent was just a 'flipper' who would only close if he found a buyer after he had her contract in hand. The damage to her was holding her property off the market during a time of falling oil prices. Ms. Wood was behaving honorably by not marketing the property to other buyers during those 30 days. She was standing by her word that she would sell to the college. She is not objecting to the draft as that was only supposed to be a delay while title was run. She is upset that she was told that there was a specific buyer (college) in place and then she says she found that this was not true.
The larger lesson is to ask a lot of questions and ask for all details in writing, whether about an offer to purchase or to lease. If you sign an agreement to lease or sell, specify the date of expiration as this saves any question of failing to revoke your offer to sell or lease. When leasing, require 2 originals that both you and lessee sign and include a clause that the lease is not valid until you are paid and the lease is recorded. Make sure that you have one signed original lease in your files. If the oil company wants to file a memorandum of lease, do not give it to the lessee until you have received back the original lease signed by the lessee.
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Same thing JUST happened to me with this co — Ferrell oil
Bad news!