Replies to This Discussion

Permalink Reply by Finnbear on May 20, 2011 at 1:59am

If the current landowner is filing an "Affidavit of Abandonment" to reclaim them then the holder has to file a claim of preservation to retain them. The abandonment claim triggers the preservation claim.

You have to look at H in its entirety to see the whole picture. The 7 cousins can file a claim of preservation either way.

(H)(1)(a) says the holder can simply file a claim of preservation in accordance with (C). This tells the landowner that the holder is aware of the interest and intends to retain it.

(H)(1)(b) says the holder is claiming preservation through the filing of an affidavit declaring one of the events outlined in (B)(3) actually occurred in the 20 years before the date of the abandonment notice

(H)(2) deals with what happens when the holder FAILS to file a claim of preservation, files it too late, or fails to file an affidavit declaring and event has occurred as outlined under (B)(3), or files it too late. In any of those cases, the recorder is required to memorialize the abandonment record and the rights are vested back with the landowner. The last sentence of (H)(2) protects the landowner and does not allow anyone else besides the landowner to declare the rights abandoned and hold them as property.

(H)(1) If a holder or a holder’s successors or assignees claim that the mineral interest that is the subject of a notice under division (E) of this section has not been abandoned, the holder or the holder’s successors or assignees, not later than sixty days after the date on which the notice was served or published, as applicable, shall file in the office of the county recorder of each county where the land that is subject to the mineral interest is located one of the following:

(a) A claim to preserve the mineral interest in accordance with division (C) of this section;

(b) An affidavit that identifies an event described in division (B)(3) of this section that has occurred within the twenty years immediately preceding the date on which the notice was served or published under division (E) of this section.

The holder or the holder’s successors or assignees shall notify the person who served or published the notice under division (E) of this section of the filing under this division.

(2) If a holder or a holder’s successors or assignees who claim that the mineral interest that is the subject of a notice under division (E) of this section has not been abandoned fails to file a claim to preserve the mineral interest, files such a claim more than sixty days after the date on which the notice was served or published under division (E) of this section, fails to file an affidavit that identifies an event described in division (B)(3) of this section that has occurred within the twenty years immediately preceding the date on which the notice was served or published under division (E) of this section, or files such an affidavit more than sixty days after the date on which the notice was served or published under that division, the owner of the surface of the lands subject to the interest who is seeking to have the interest deemed abandoned and vested in the owner shall cause the county recorder of each applicable county to memorialize the record on which the severed mineral interest is based with the following: “This mineral interest abandoned pursuant to affidavit of abandonment recorded in volume …., page …..”

Immediately after the county recorder memorializes the record, the mineral interest shall vest in the owner of the surface of the lands formerly subject to the interest, and the record of the mineral interest shall cease to be notice to the public of the existence of the mineral interest or of any rights under it. In addition, the record shall not be received as evidence in any court in this state on behalf of the former holder or the former holder’s successors or assignees against the owner of the surface of the lands formerly subject to the interest. However, the abandonment and vesting of a mineral interest pursuant to divisions (E) to (I) of this section only shall be effective as to the property of the owner that filed the affidavit of abandonment under division (E) of this section.

 

 

Permalink Reply by Alan Coogan on May 25, 2011 at 1:04pm

Mr. Vaughn--

This is nonsense.  You may have a reserved mineral interest in the chain of your land title, for example a deed saying .".reserving all coal and other minerals"..  That sort of language is common in the coal-bearing counties in Ohio (Mahoning, Columbiana, Carroll, Jefferson, Belmont).  If the land  history meets certain criteria the claim can be extinguished by application of the procedures under the statute regarding lapse of mineral rights.

 

The land men have probably done the research, or can do it.  They can not file the affidavit

 

Stick with or get a real property--oil and gas lawyer, then pay for a title examination. That will take time and cost you some, or give in and give up one-half for some one else to do the work.

 

I've gone through this procedure--(Finnbear above cited some of the criteria) it takes a minimum of 2-3 months,costs hundreds of dollars, depending on the title complexity, and is not fail safe.  I really doubt there is big rush.--it might help you to know  who is leasing.  Then get help.

 

Alan coogan

Attorney at Law

Permalink Reply by Finnbear on May 26, 2011 at 6:59am

Mr. Coogan,

I think in this situation Mr Vaughan may be the holder of a reserved mineral interest that he (unknowingly) inherited from his deceased grandfather when his grandfather sold the land many years ago. Mr. Vaughan appears to not have a handle on all the mineral interests he may have inherited and may very well not know where the property in question is located or when his Grandfather sold it and reserved that mineral interest. Because of this, he has NO starting point of reference for doing the title examination. Most likely, the current landowner wants get in on the shale boom and sell lease rights to the property. He probably found that he doesn't own them and has filed an Affidavit of Abandonment for this piece of property and is patiently waiting for the 30/60 day period to pass. If Mr. Vaughan doesn't answer the Affidavit of Abandonment with a Claim of Preservation in that 30/60 day period, then the current landowner will have the mineral interest vested back with the property. The landman appears to be trying to get in the middle of this process and his legal counsel could very well file the Claim of Preservation on behalf of Mr. Vaughan with the condition that Mr. Vaughan give the landman's company half the  mineral interest for doing so. It may very well be too late for Mr. Vaughan by virtue of the deadline (last Friday) insisted on by the landman. The 30/60 day waiting period may have expired last Friday. I have been on both sides of this situation and know more than your average landowner about it and how it works .

Permalink Reply by Alan Coogan on May 27, 2011 at 3:19pm

Mr. V.

 

Finnbear's practical advice is sound and experienced-based. As he notes,

timing, all the facts and the law are crucial.-

There have been revisions to the mineral lapse statute. Check with your lawyer.

Hard work may really pay out

 

A. Coogan

Permalink Reply by Finnbear on May 28, 2011 at 10:35pm

Something to consider for anyone who is worried about spending the money to have a competent attorney do a title examination and filing to vest mineral rights back with the surface owner. All the costs incurred in obtaining an oil & gas lease are 100% deductible form the tax bill you will get in the year you sign that lease. You will give up 30-40% of the lease bonus in taxes to state and federal. Unless you are in business as a farmer, there are very few deductions available to you to soften the tax bite. Your investment in attorney fees will come back to you as a tax deduction. Better to pay someone competent and get it right and then reap the tax benefit.

 

Permalink Reply by Finnbear on May 19, 2011 at 10:54am

In Ohio, if a previous owner reserves the mineral rights when they sell a property, they can (and their descendants) retain those rights forever, no matter who the landowner is. The property could change hands a dozen times and the original person (and their heirs after they die) who reserved the mineral rights still owns those rights. A landowner may sell a piece of property and retain (reserve) the gas&oil rights because they believe the area is going to be developed for gas&oil in the future. Possibly that development never happens and then time marches on and the person who reserves those rights passes on and their heirs have no idea that they technically hold title to the mineral rights. Another generation of heirs could end up with those rights and have no clue they hold title to them. Ohio law provides a means for the current landowner to get those rights back provided that a few conditions are met. One condition is that for the past 40 years, NOTHING has been done with those reserved rights - no lease sold, no well drilled, no effort to sell them to someone else, etc. In that case, if all the conditions are met, the current landowner can post a legal notice in the "newspaper of general circulation" of the county where the land is situated. This legal notice will indicate that the current landowner (Surface Owner) is declaring those previously reserved rights abandoned and wants them vested back with the SO. This notice is posted ONE time in the newspaper in the county where the land is located. Thirty days later, the SO files an "Affidavit of Abandonment" with the county recorder's office in the county where the land is located. Thirty days after that, if nobody answers the claim, the county will certify the claim of abandonment and vest the rights back to the SO (current landowner) and the property is made whole again.

You need to figure out which of your ancestors owned property and where - IMMEDIATELY and have a competent attorney answer the Affidavit of Abandonment by Friday or you will lose those rights FOREVER. Since time is short and you probably don't have time to get an attorney to do the research and post the required counterclaim, you might cut your losses and take the deal that Buck the landman is offering. You will at least end up with half of something you really never had. You should probably thank Buck for looking out for your best interest (and his). Without him looking for a way to make a buck (pun intended) off of your ancestor's lack of due diligence in letting his heirs (you) know what they inherited, Friday would come and go and you would have NOTHING and would have no knowledge that you ever lost anything. Don't blame Buck for trying to screw you out of 1/2 of those rights. You didn't know you had them and wouldn't know you lost them if not for Buck the landman. If those 70 acres are in a hot area in the shale play, you could stand to gain lots of money you never had - all thanks to Buck the landman looking for a way to make a buck (pun intended again).

You should IMMEDIATELY read Ohio Revised Code Sections 5301.51, 5301.52 and 5301.56

http://codes.ohio.gov/orc/5301.51

http://codes.ohio.gov/orc/5301.52

http://codes.ohio.gov/orc/5301.56

ORC 5301 deals with property rights in general. It is a lot of reading. You should read it and know it or use an attorney when dealing with matters like this.

http://codes.ohio.gov/orc/5301

Good Luck - If I were in your position, with time running extremely short, and didn't know where said land was located, I'd take Buck the landman's deal. 50% of something beats the hell out of 100% of nothing. I've been through this process as a current landowner whose land was not whole due to a previous owner reserving those rights over 75 years ago. The heirs never did anything with the rights. It took a TON of time and research and I was successful in getting the mineral rights vested back on one parcel. I was not able to get the rights back on my other parcel as that claim was answered.

The clock is ticking.....

Finnbear

Permalink Reply by Jmaes Vaughan on May 19, 2011 at 1:42pm

I understand the process a landman in this situation is presenting, and Buck has been polite and fairly direct through it all ( I mean to cast no particular shadow on him personally). But we do have other holdings in the area. They are left-overs from older and larger estates. Our concern was that signing papers with a blank fill in what you want land description could have given these people the option to have 1/2 rights to some of this other 'real' property.

 

We and our attorney's office have spent the last three days scouring the New Philadelphia/ Dover Times Reporter and even the Bargain Hunter, going back a year, and have found no notice.

 

It's funny, a person gets into this sort of thing, and they start dreaming up more possible schemes than any carpetbagger could ever imagine.

 

It's a common practice among high pressure salesman to create an artificial, do or die, deadline.

 

I remember my poor Mother spending years trying to sort out all the land/ mineral holdings that my Grandfather had. ( the small areas we 7 cousins are concerned with are the ragged leftovers that were at the time deemed of no value or unsaleable).

 

It is clear that we need to get better idea of what we still have. It will be hard to determine it's real value under the speculative circumstances. I am hoping we can find some sort of agent in the area who can look out for our interests and won't cost us a bunch of money we can't afford.

Permalink Reply by Finnbear on May 20, 2011 at 1:14am

The picture gets a bit clearer and muddier at the same time. By "other holdings in the area", do you mean real property or mineral interests? If you are speaking of mineral interests held by you when someone else is the current landowner then it may be one of those interests that Buck is trying to make a buck on. If any of those mineral interests have been dormant for more than 20 years, you stand to lose them through the "Affidavit of Abandonment" process as outlined in ORC 5301.56. 

Imagine this if you will: Say your Grandfather sold a piece of property many, many years ago but reserved the mineral rights when he sold it. Maybe he thought he would get an oil well drilled in the future but then it never materialized. If he never did anything with those rights, technically you still own them today, even if you are not aware of their existence. Say the current landowner hears about Marcellus and Utica wants to become a "Shaleionaire" himself by selling lease rights to the property he now owns for big money. In searching the title, he finds out that he doesn't even own the gas & oil rights to HIS property, your grandfather does, and he died years and years ago. The landowner gets bent out of shape and goes out and hires a good Oil & Gas attorney who says he will file an "Affidavit of Abandonment" claim and, if no one answers it, the rights will be vested back with the land. Here is where you and Buck the landman come in. Buck has this piece of property on the list of land he wants to get leased for his employer. He realizes the landowner has filed an Affidavit of Abandonment which is about to be memorialized by the county on Friday and NO ONE (you & your cousins) has answered it with a preservation claim.

He has two options. One, he could wait until Monday and go try to sign the landowner and his newly vested mineral rights. The landowner has invested a fair amount of money the get the rights back and might be a hard sell. Buck might have to up the ante for this lease and pay a higher signing bonus and/or a bigger royalty to get this landowner to bite on the first offer after he got the rights back. Buck's second option is to figure out who the descendants (you & your cousins) of the holder of the rights (your Grandfather) are. Buck knows how to track people down, he does it for a living, and he finds you. Buck is a gambling man and he is betting you don't even know you inherited these rights. The clock is ticking and he contacts you and pushes you to give him 1/2 of those rights or lose them forever. If you do, he files a claim of preservation and names himself half owner and wins big. He now has a vested interest in who the mineral rights for that land get leased to because he owns half. If you don't, you lose those rights forever on Friday and Buck makes that appointment with the landowner next week. Is this making any sense now?

You mentioned that "we need to get better idea of what we still have". You need to figure out every single piece of property your Grandfather owned. You need to do a full title search on each and every one of those properties and find out what rights, if any, he reserved when he sold the property. You need to file a claim of preservation pursuant to ORC 5301.51, assuming that it has not been over 40 years since he reserved them.

You mentioned that you looked in the New Phila Times Reporter. This is the correct one to look in for land in Tuscarawas County. Don't waste time with the Bargain Hunter as that is not the official paper of record for legal notices to be posted in. If the land in question is in another county, then you have to look in the paper for THAT county. Here is a website where you can search for legal notices in Ohio:

http://www.publicnoticeads.com/OH/  

There was one Affidavit of Abandonment posted in the Times Reporter on 3/24/11. We are now at about 60 days after that posting and that landowner is going to get their rights back if no one answers with a claim of preservation. Does this one have anything to do with your family?

http://www.publicnoticeads.com/OH/search/view.asp?T=PN&id=607\3...

 

Permalink Reply by Jeremy on May 19, 2011 at 4:24pm

Finnbear,

This is great information.  Did you do this on your own or did you have an attorney help you when you made attempts to get the mineral rights back?  I have some property that has most the rights with it but has very small fractions here and there that I'd love to get back just to make it whole.  If you did use an attorney, can you give a recommendation?  How much did it cost to do this?

Thanks,

Jeremy

Permalink Reply by Finnbear on May 19, 2011 at 10:16pm

I did this on my own. It cost me very little $-wise but I have a lot of hours invested in the process. My mother worked for an attorney for many years and now writes legislation for county government so she wrote the legalese on the affidavit. If you don't have that background, I would suggest having an attorney do that part. As for the fractions of rights you want to get back, you first need to go to the Recorder's Office and trace the deeds back on that piece of property to the point where the rights were reserved away. Go back one deed prior to the rights going away just to make sure. An attorney will send a paralegal to do this research and they will charge you considerably for it. You can do it yourself. Have copies made of all the deeds and take them with you. Once you know who reserved your rights away, then you just have to follow the instructions in the sections of Ohio Revised Code that I posted earlier. This is the point where you go to a competent property rights attorney and lay out for him/her what you need done. Since you have done the legwork, the rest should be easy and straightforward for the attorney .They will put together the affidavit and notify the parties involved by the method that fits your situation and then do the filing with the county. As long as no one answers your claim, in 60 days you may get the rights back.

 

Permalink Reply by Finnbear on May 24, 2011 at 11:07am

So how did this turn out? Did you find out what property the landman was trying to make a deal with you on?

Finnbear

Permalink Reply by Poison Ivy on May 25, 2011 at 11:22am

It sounds fishy to me. I would wait. YOur attorney should be able to uncover anything this Buck has uncovered. Supposedly.

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