The relationship between a landlord and tenant bears the same characteristics of a lessor and lessee in oil and gas. Under common law, some leases are treated as profits while others are contracts.
Oil and Gas Leasing
The majority of statutes under this umbrella have to do with regulatory bodies. Many states have statutes that govern modify or govern the relationship between the lessor and lessee. There is also a chance that a statute exists that makes the recording of an affidavit of production that is essential to maintaining a lease beyond its primary term.
The term “minerals” has different meanings and restrictions in states. Once severed from the surface estate, the minerals must be recorded at specified intervals.
There is a necessity of strong judicial policy in favor of enforcing curative statutes to increase the reliability of record title.
Title by Limitations
There are a few statutes that allow title and real property to be acquired through the passage of time. Each state has different time periods and possessions for jurisdictions in establishing title.
Probates are an extreme problem area in title examination. A determination that property was properly required, taxes paid, and instrument of record accurately display the probate proceeding are necessary. An examiner needs to locate all documents pertaining to the probate.
Taxes can affect title minerals. The examiner must assess whether the property is paid up in taxes or if a lien is in place.
Marketable Title Act
Marketable title acts are curative statutory creations designed to clear up any confusion on titles based on the passing of time and possession of land by identified parties. These are one of the most important items to look for.
A proper acknowledgment must be reviewed for an omitted acknowledgment or a defective acknowledgment to mitigate consequences.
Recognition of Foreign Acknowledgements
Acknowledgment forms vary from state to state and not all states accept every acknowledgment.
Oil and Gas Conservation
The majority of oil producing states have statutes that establish an oil and gas conservation commission or other authority that oversees production, spacing, pooling in a regulatory body.
Conveyances to Trustees
A conveyance to a trust must be to a named trustee for the benefit of a named beneficiary. A trust is not a legal entity that is capable of holding title.
Power of Trustees
Statutory provisions should be checked to define the powers a trustee has to act with regard to property. Acts are routinely modified in oil and gas leasing.
Corporate executions of deeds should have an officer that possesses the authority to convey property. Different state statutes need to be carefully searched for the required format.
States have different statutes regarding affidavits and the conclusions drawn from them. Some affidavits are presumed to be accurate when it has been recorded for a period of time.
Dower and Curtesy
This has been abolished in most states but some still enforce inchoate spousal rights. The examiner must know the rights given to the spouse with this statute and if any conveyances require action from both the owner and the spouse.
Some states make spousal signatures mandatory for community property. Community property laws may be affect distribution in probate proceedings.
Partnership Real Property
Partnerships may not be able to hold property, it must be in the names of the partners. Other states both ways suffice.
These are local guidelines to aid in the interpretation of property title published by statutory enactment or committee of a local bar.
The BLM’s oil and gas regulations should be known forward and backward. General principles of property law do not help with federal oil and gas leases.
Very few statutes have retroactive applications. Statutory enactments are applicable to any conveyance are those in existence at the time of conveyance.