What happens when one partner who owns one equal share to mineral rights goes rogue
and signs a lease agreement without the consent of the majority?
How about when 50% of the owners sign and 50% refuse?
What are my options when I am one of the partners who won't sign this lease?
Thanks in advance,
Jack
I agree with Mr. Taft. My previous post was probably in error in more ways than one. I should have asked you to define partnership, whether there were more than 2 partners, is it a family partnership or whether it was a purely business partnership, whether you had formal written agreements or merely shared verbal intentions. In some cases I think you could hope to recover damages and in others I think it would be fruitless.
It is a family patnership. 6 members on one side and 4 on the other. The land was originally owned
by my father and my aunt. My 5 brothers and I own 50% and my 4 cousins own the other 50%.
I did some research and thought I had convinced everyone to not sign with this particular LLC but
one of the members saw dollar signs and signed the lease. This caused a panic by the others on that side of the family so they signed or are signing. What happens now? What are the options for those who did not sign?
How does this work?
r w kennedy said:
I agree with Mr. Taft. My previous post was probably in error in more ways than one. I should have asked you to define partnership, whether there were more than 2 partners, is it a family partnership or whether it was a purely business partnership, whether you had formal written agreements or merely shared verbal intentions. In some cases I think you could hope to recover damages and in others I think it would be fruitless.
Mr. Backus, your bargaining position may have been hurt, but possibly not. I think your options are to lease to the same company, but if that wasn't agreeable before I see no reason why it would be now. You could lease to a different party, if you come to agreeable terms. If you can't come to terms with some other company, you can wait. The value of the minerals of those who already leased have basically become fixed in time, until the lease ends. Your minerals can continue to appreciate. You could conceivably lease your minerals in a few years for double or 3 times as much as your cousins received, just look at what prices have done in ND since 2008 and are continuing to do. You can't know the full intentions of the LLc your cousins leased to. They may have only been seeking an acreage position so they could sell out at a profit later on, possibly they intend to participate in a well drilled by someone else. In your position, if I didn't see a rig nearby, I'd just wait and see how much my minerals appreciated. I hope your cousins at least get paid, you never know when you are dealing with an LLc. You still have the options you always had.