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Will Bequest

Business Law discussions

Will Bequest

Postby Bonifacio » Tue Oct 18, 2016 5:22 am

Decedent's Will says A receives "all my mineral rights in the oil wells in X county, Texas that are currently under lease with ABC Oil Company."  There's no problem with knowing what the word "currently" means because at the time of the Will execution and at the time of decedent's death the same leases were in effect.  There is a problem, however, with trying to figure out what "under lease with ABC Oil Company" means.  ABC is the operator on certain leases, but on one other lease another company is the operator and ABC is listed as the owner.  Does A get the interests where ABC is the operator, as well as the interest where ABC is not the operator but is the owner?  (If A doesn't get that one interest, it falls into the residuary.)
Bonifacio
 
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Will Bequest

Postby Dontaye » Wed Oct 19, 2016 3:04 pm

Operatorship is irrelevant.  The will stated that A receives "all my mineral rights in the oil wells in X county, Texas that are currently under lease with ABC Oil Company."  What is dispositive in this case is what is under lease - operations of the wells is not a factor.  

A will receive all mineral rights for rights leased to ABC Oil Co.

If we are being picky about the law - and some could be, when minerals are leased the lessor is no longer a mineral "owner" but are the owner of a royalty interest.  An oil and gas lease is a defeasible fee with possibility of reverter.  The oil company is the "owner" of the minerals until the lease expires or the habendem clause expires.

Sincerely,
Dontaye
 
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