My sis, a New Mexico resident, died in 2022 without a will. No probate was necessary and didn’t occur. As her Personal Representative, I need to transfer her ownership of four gas lease overrides in Kansas (Seward Co.) and am hoping I can do this without opening up probate, possibly in two states, $$$ugh. I’m hitting a wall with the operating company as they haven’t replied to my emails with attachments of Death Certificate and docs from the state assigning PR to me. I’m wondering if I’m missing something.
Any thoughts?
Thank you!
It depends on how much revenue is involved, but Kansas considers overriding interest to be personal property. You should talk to the operator about using a Kansas small estate affidavit. You will need to review the annual royalty income to make sure it is low enough to fall under the Kansas small estate affidavit limit. Most operators in Kansas will honor a recorded small estate affidavit assume the revenue isn’t “significant”.
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If the gas overrides are personal property under Kansas law, then the state of domicile (NM) controls which probate procedure is appropriate. You need to consult with NM attorney.
Since no probate was necessary in NM, it would actually fall to Kansas to determine if you need probate or if it qualifies for Small Estate Affidavit. Kansas would probably be cheaper for probate than NM based on my experience. If it’s truly only ORRIs and they are worth less than $75,000 (assume for this purposes they earn less than $800 a month on average) then they could possibly pass via Small Estate Affidavit.
Have you contacted the operator and asked them what they require / suggest? ORRIs in Kansas are not real property so if it were me I’d be looking for the lowest cost avenue to get them put into pay status, especially if they are not making alot of royalties. If they are making big $$ and you may want to sell one day, then doing actual probate is probably required by the operator and recommended so that the ORRIs have good title in the event you want to market them at some point. One crude purchaser in Kansas I’ve worked with recently will accept the small estate affidavit so long as the monthly income is less than $400. Each crude purchaser or operator will have different rules.
Going to NM in this case may be wasteful by adding unnecessary legal fees, and may still require ancillary probate in KS regardless. Some courts do not want to take cases that do not involve property in their jurisdiction (like going to NM for probate when no NM assets are at issue and all of the assets are in KS where NM has no jurisdiction).
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Because the decedent was domiciled in New Mexico, the proper forum for a small estate affidavit is New Mexico not Kansas because the state of domicile has jurisdiction over a decedent’s real property and intangible personal property–assuming the ORRIs are intangible personal property, and the value of such interests will determine whether the small estate affidavit procedure is appropriate. Form of Kansas Small Estate Affidavit under K.S.A. 59-1507b requires a copy of the death certificate to be attached, which may present a problem if the death certificate was issued for a New Mexico decedent.
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Because we are differing in our suggested remedies, I suggest the original poster contact the operator to advise you on what course of action to take.
I also suggest that New Mexico has no jurisdiction over property in Kansas unless a Kansas court agrees to such. The only state in this region that accepts out of state probates without needing ancillary probate in the state where the minerals are located is Texas.
Well, I’m running into a lot of legal hurdles and after umpteen hours of headaches with no next steps, I’m thinking I’ll turn this over to an attorney, maybe best to use a Kansas attorney. A landman might help too. Once I have the ownership transferred into my name, I want to sell or relinquish all to whomever wants it. I don’t want my kids to inherit this nightmare.
Any suggestions for an attorney and landman working in Kansas?
Thanks!
What county or counties are the ORRIs in? What are the lease names + operators or crude purchasers?
Overriding royalty interests are classified as real property and the state where the minerals are located determines the requirements for title.