"TERM INTEREST" DEED QUESTION RE: 8-22N-10W Major Co., OK

Oklahoma Mineral Rights
1

Hello:

I recently received a request to lease my interest in Sec. 8-22N-10W in Major County, OK. I agreed to the lease, received a check for my interest, and all seemed fine. Ten days after receiving the check, I got a call from lessee that the original deed that conferred my interest was a "term interest deed" that expired if no oil production occurred after the original term of 20 years, that the area being leased did not show production during the time in question, and therefore my deed is no longer valid, and they are asking for their money back.

This was their error, and I had no knowledge at the time I signed the lease that the deed for my interest was a "term interest deed." I did find the original deed (from 1948) in my records and it is a 20-year term deed, but it also includes a provision that the deed remains valid as long as oil production occurs after the initial 20 year term. One response in another forum indicated the production may have to be "continuous" for the deed to remain valid, but I don't see that stipulation anywhere in the deed. Additionally, according to a 1984 court case (Fox vs. Feltz), if a term-interest deed is in its secondary term (after the initial 20 years has passed) production need not be on the land conveyed by the deed, but can be from a drilling and spacing unit encompassing the described land in the deed.

Does anyone know how I could determine if production has occurred on or around Sec. 8-22N-10W in Major Co., OK in the years since 1968? (the end of the 20-year term). I don't want to take the landman's word that my deed is void before researching the issue myself.

And, if a lessee sends a lessor a check, then the lessee subsequently finds they made an error and wants their bonus money for a lease back, is the lessor obligated to pay that money back? Does anyone know where to find a precedent legal case for this, or is it a question for a lawyer?

Thanks in advance for your help!

(I've also posted this question in the Major Co., OK and "Ownership Questions" groups).

Angela

2

I can give you a quick YES. There has been 6 or 7 wells that have air are producing.

I'll give you the completion reports later.

3

Anglea,

Here are the 6 wells listed in the OCC. Some may have been plugged.

http://imaging.occeweb.com/OG/Well%20Records/00000012/OCC_OG_1L534K...

http://imaging.occeweb.com/OG/Well%20Records/00000012/OCC_OG_2MQ216...

http://maging.occeweb.com/OG/Well%20Records/00000012/OCC_OG_1K5BKK1_1934JIV.pdf

http://maging.occeweb.com/OG/Well%20Records/00000012/OCC_OG_18PSHIJ_19QS4MO.pdf

http://imaging.occeweb.com/OG/Well%20Records/00000012/OCC_OG_2MQAH6...

http://imaging.occeweb.com/OG/Well%20Records/00000012/OCC_OG_3CSE02...

4

Anglea,

Wells 1 and 3 are dry holes. Well 2 -18 bpod, 4 - 61 bopd, 5 - 28 bopd, and 6 - 28 bopd.

5

Daniel:

Thanks for this information. I see now where I can look up well production at the OK Corp Comm site. According to the info I found, all the wells you listed are now at a "PA" status, which is code for "plugged" (see the attached document for well codes) but the fact that they were producing after 1968 may be helpful when I talk to an attorney regarding this issue.

Do you happen to know how far back in years the production reports go to at the OK Corp Comm site?

Angela

2015-WELL_STATUS.doc (36 KB)
6

Next time if there is any question whatsoever, write it out in longhand if necessary at the bottom of the lease.

That way you are not responsible for anything.

then if he still wants the lease, take his money and have fun. Any decent landman would have caught that. I would personally tell them to eat worms, DEPENDING on the $$$ involved. A large

company will probably not pursue for small $....'cause they have bad press anyway.

7

Let me address the second question. Yes, you are obligated to return the money. This isn't a mistake situation, therefore you get to keep the money. If a bank accidentally put money in the wrong account, the account holder doesn't get to keep the money. The theory of having to return the money is unjust enrichment.
Unjust Enrichment

A general equitable principle that no person should be allowed to profit at another's expense without making restitution for the reasonable value of any property, services, or other benefits that have been unfairly received and retained.