The Roles are Flipped, You Need Information:

When you were young your parents found ways to protect and provide for you.  As your parents age they increasingly need your care.  You need answers including legal realities.  This article and the audio content describes the type of information you need to receive.  It also provides practical tips to create open communication.

Dynamics of Communicating with the “Silent Generation”

People born before 1946 are known as the “Silent Generation”.  Their world was shaped by the Great Depression, WWII, The Cold War and the Civil Rights Movement.  They are often described as less open with personal issues including health and finances.  They value simple concepts and rarely view themselves of wealthy regardless of their net worth.  “Waste not want not” means much to them. 

Cimarron Express Pipeline, LLC, Has Filed Suit in Kingfisher, Logan and Payne County Seeking to Take Land for Pipeline.

Since November 2018, Cimarron Express Pipeline, LLC, has filed 30 lawsuits in Kingfisher, Logan and Payne Counties.  Why?  Because they want to take land by eminent domain to build pipelines across land they do not own.  But landowners have rights.

Eminent Domain Guide for Land Owners, By Harlan Hentges & Richard Winblad

If you’re reading this, somebody probably wants to take all or part of your property to build a road, pipeline, power line, or something else on your land, and you would prefer they went elsewhere. You’re not alone. Many people have been in your position. Congratulate yourself for doing research, which is the best first step.  This is called “Taking”, “Condemnation” and “Eminent Domain”.

What is eminent domain?

Eminent domain is the power of the government to take (condemn) private property. In the United States private property can only be taken for public use and the owner must be paid just compensation. (United States Constitution, Fifth Amendment) The government has even delegated the power to some private businesses such as utilities or pipeline companies.

Do they really have the power of eminent domain?  Can I Stop the Condemnation Taking?

Sometimes the answer is clear. If a state department of transportation is widening a highway, it is probably clear that property can be taken by eminent domain.  Other governmental entities may include the federal or state agencies, universities, water departments, agency, county or city governments.

Sometimes the answer is not clear, especially when it’s a private company. You might be surprised that private businesses can use eminent domain. These can include pipeline and utilities companies or neighborhood developers.  Determining whether they actually have the power of eminent domain can get complicated. For example, eminent domain can be used for some oil and gas pipelines and not for others. The person communicating with you should be willing and able to explain exactly why and how they have the power of eminent domain. Don’t be afraid to ask and expect a clear answer. If the answer is not clear, dig deeper and don’t be bullied into accepting their offer.  Sometimes cases must be taken to the Supreme Court to stop the taking.  Read More.

What is the difference between an Private Easement and an Eminent Domain Taking?

A private easement is negotiated when a company does not have the “power” to take your land through eminent domain.   If the company does not have condemnation powers you can absolutely refuse to allow them on your property.  They must negotiate for a private easement.  Therefore, you are in a great position to ask for greater compensation or make other requirements.

The Oklahoma Constitution states:

No private property shall be taken or damaged for private use, with or without compensation, unless by consent of the owner, except for private ways of necessity, or for drains and ditches across lands of others for agricultural, mining, or sanitary purposes, in such manner as may be prescribed by law.

What are the Landowner’s Rights Under Oklahoma Law in Eminent Domain?

You are entitled to receive just compensation if your property is taken for a public use.

Your property can only be taken for a public purpose.

Oklahoma law prohibits the taking of your property solely for economic development.

Your property can only be taken by a governmental entity or  private entity authorized by law to do so.

The entity must notify you that it wants to take your property.

The entity proposing to take your property must make a bona fide effort to negotiate to buy the property before it files a lawsuit to condemn the property – which means the condemning entity must make a good faith offer.

You may hire an appraiser or other professional to determine the value of your property or to assist you in any condemnation.

You may hire an attorney to negotiate with the condemning entity and to represent you in any condemnation proceeding.

Before your property is condemned, you are entitled to a copy of the commissioners’ report which determines the injury you may sustain by the condemnation of your property and the amount of just compensation entitled to you.

If you are unsatisfied with the compensation awarded by the commissioners’ report, or if you question whether the taking of your property was proper, you have the right to a trial by a jury or review by the district court judge. If you are dissatisfied with the trial court’s judgment, you may appeal that decision.

How much should you get as “just compensation”?

If they take your land under eminent domain you are entitled to be paid for two things: (1) fair market value of the land they take; and (2) the decrease in value of what is left.  The total of these two amounts is called “just compensation.”

Fair Market Value:

            You are entitled to the fair market value of the land taken.  Fair market value is the price a willing seller would receive from a willing buyer where neither are under an obligation to buy or sell.  Often the condemner will have an appraisal of your property.  Keep in mind that their goal is to acquire the property with smallest payment possible.  The appraiser, who works for the condemner, knows that his job is provide the lowest possible value.  Appraisals vary widely and you are not required to accept their value as accurate.

Damage or Diminution in Value to the Remainder

            Taking part of your property often causes the rest of your property to lose value.  The decrease (or diminution) in value to portion that is not taken is more complicated. If you’re a farmer and they put a four lane highway through your land, the value of the entire property is decreased because it cannot be operated as efficiently. If you’re have a business and they widen a highway into your only parking lot, the value of the entire property is diminished due to inadequate parking. If you’re a homeowner and they put a large gas line in your yard, the value of your house is diminished because home buyers would prefer to not have a large gas line in their yard. The amount you should be paid for the decrease in value to the entire property depends on your particular circumstance.

What happens if you don’t reach an agreement?

This is the part scares some people, but it shouldn’t. If you do not reach an agreement, the government company has to file a condemnation lawsuit. That doesn’t mean you have done anything wrong, and they still have to pay you “just compensation” as discussed above.  If you disagree with the compensation you have a Constitutional Right to have the value determined by a jury of your peers.

An eminent domain case has its own special process unlike any other lawsuit.  An explanation of the procedure could easily fill a thousand page book.   In short, it is not a task to be undertaken by an attorney unfamiliar with the process.  Often, landowners reach a better result is when the company or government is forced into litigation.

What will the negotiations be like?

You never can tell. The person who contacts you is like a salesman. Everything they do and say is intended to get you to say “yes” for as little money as possible. They might flatter you or try to intimidate you. They may share information, or they may be secretive. They might be good at their job or not. They might be honest or not. They are just people and they have no power to make you do anything.

There will be two things to discuss. One is the amount of money they will pay you.  The other is the description of what they want to take. For example, if it is a pipeline, do they want the right to put things above the ground or only beneath the surface?  If it is an electric line, do they want the right to place large metal towers with many lines, or smaller poles with few lines? Do they want to restrict you from building driveways, roads or planting trees? These and many other things can be negotiated to make sure that you are giving them only what they really need.

How much does it cost to have an eminent domain attorney represent me in eminent domain?

Obviously, you want to end up in a better situation by using an attorney than not.  This may mean more compensation or a more favorable terms.  Sometimes an attorney may agree to represent you on a contingency basis.  This means they  would receive a percentage of increase of value.  For instance, if the initial offer was $10,000 and you ended up with $40,000, the fee would be based upon the increase or a portion of $30,000.  At other times, the attorney may agree to an hourly rate.  If the dispute goes to trial, the attorney may be entitled payment from the condemning authority or company.

Inverse Condemnation: When land is taken without going through the procedures:

Occasionally, land is taken by without going through any procedures.  It may occur through a mistake about boundaries, water backing up onto a landowner’s property.  In short, the condemnation procedures were not followed.  In this case, the law provides a remedy called inverse condemnation with the same compensation as described above.

Conclusion

You should be proud of what you have, and you have every right to insist your property rights be respected. Part of being a property owner is knowing that in certain situations your property can be taken for public use, but that does not mean that you must accept what you are being offered. You don’t have to answer their questions. You don’t have to believe what they are telling you. Ask questions. Expect answers. Talk to you neighbors.

More Information:

The following are from Title 27 of Oklahoma Statutes, the Oklahoma Constitution and Oklahoma Attorney General materials for which no copyright or credit is claimed.

Section 1 – Lands Subject to Right of Eminent Domain in Behalf of Any Public Enterprises

The lands set apart for the use and benefit of the State of Oklahoma for public schools, for public buildings and educational institutions, either by congressional enactment or executive reservation, are hereby declared to be subject to the right of eminent domain in behalf of any public enterprises now authorized by law to condemn private property for sewers, railroads, side tracks, station grounds and other municipal or corporate public uses, and all of the laws of this state with reference to the taking of private property for public use are hereby made applicable to the said lands.

Section 2 – Procedure of Condemnation for State Lands

Before any public corporation, municipality or other entity or person authorized to exercise the right of eminent domain under existing law, shall have the right to condemn or take any part of such lands, a plat of the grounds proposed to be taken, showing the part of the particular subdivision, shall be prepared and filed with the Governor of said state, together with a sworn statement of the engineer or superintendent in charge of such public work, that the taking of such lands is necessary to the exercise of the powers of such municipality or corporation; and it shall be the duty of the Governor to appoint three disinterested persons, resident householders of the county in which such land is located, who shall first take an oath to fairly and impartially appraise the value of the ground so taken, and the damage to the remaining parts of such subdivision by the taking thereof, and the said appraisers shall notify the Governor and the officers of such corporation of the time and place when they will proceed to appraise such damage, and at such time and place, upon actual view of the premises, the said appraisers shall meet and appraise the damage, in writing, and return one copy thereof under their signatures to the Governor of the state, and one copy to the principal officer of such corporation or municipality in charge of such construction, and if either party is aggrieved they may, within ten (10) days, appeal to the district court of the county where such land is located, in the same manner that appeals are taken from judgment of justices of the peace, where the amount of such damage shall be tried by a jury, as other causes are tried. In case no appeal is taken from the award of such appraisers, such corporation or municipality shall have the right to occupy such grounds by the paying into the State Treasury the amount of such award. In case either party appeals, such corporation or municipality shall have the right to occupy such grounds upon giving bond in treble the amount of the award, with sureties to be approved by the clerk of the district court where such appeal is pending, to the effect that the corporation or municipality will pay said award if such appeal be dismissed, or shall pay any judgment finally rendered in said action if the same shall be tried.

Section 5 – Power to Condemn Lands

Any county, city, town, township, school district, or board of education, or any board or official having charge of cemeteries created and existing under the laws of this state, shall have power to condemn lands in like manner as railroad companies, for highways, rights-of-way, building sites, cemeteries, public parks and other public purposes.

Section 6 – Private Person, Firm or Corporation – Power to Exercise Eminent Domain

Any private person, firm or corporation shall have power to exercise the right of eminent domain in like manner as railroad companies for private ways of necessity or for agriculture, mining and sanitary purposes.

Section 7 – Rights – Same as Railroads

1. Except as otherwise provided in this section, any person, firm or corporation organized under the laws of this state, or authorized to do business in this state, to furnish light, heat or power by electricity or gas, or any other person, association or firm engaged in furnishing lights, heat or power by electricity or gas shall have and exercise the right of eminent domain in the same manner and by like proceedings as provided for railroad corporations by laws of this state.
2. The power of eminent domain shall not be used for the siting or building of wind turbines on private property. Title 27. Eminent Domain

Section 7.10 – Public Utility Lines – Relocating, Rerouting, Construction Changes, etc. – Expenses and Expenditures

In the event a common carrier, in the exercise of the power of eminent domain, or any other power granted hereunder, makes necessary the relocation, raising, lowering, rerouting, or changing the grade of, or altering the construction of any electric transmission or telephone lines, railroads, or properties and facilities, or pipeline, all such relocation, raising, lowering, rerouting, changing of grade or alteration of construction shall be accomplished at the sole expense of such common carrier. The term “sole expense” shall mean the actual cost of such relocation, raising, lowering, rerouting, or change in grade or alteration of construction in providing comparable replacement without enhancement of such facilities, after deducting therefrom the net salvage value derived from the old facility.

Section 12 – Inverse Condemnation Proceedings – Reimbursement of Expenses

Where an inverse condemnation proceeding is instituted by the owner of any right, title or interest in real property because of use of his property in any public program or project described in Section 1 of this act, the court, rendering a judgment for the plaintiff in such proceeding and awarding compensation for the taking of property, or the state’s attorney effecting a settlement of any such proceeding, shall determine an award or allow to such plaintiff, as a part of such judgment or settlement, such sum as will, in the opinion of the court or the acquiring entity’s attorney, respectively, reimburse such plaintiff for his reasonable costs, disbursements and expenses, including reasonable attorney, appraisal and engineering fees, actually incurred because of such proceeding. A determination by the court shall be appealable to the Supreme Court in the same manner as any other final order.

Section 13 – Policies

Any person, acquiring agency or other entity acquiring real property for any public project or program described in Section 9 of this title shall comply with the following policies:

1. Every reasonable effort shall be made to acquire, expeditiously, real property by negotiation.
2. Real property shall be appraised before the initiation of negotiations, and the owner or his designated representative shall be given an opportunity to accompany the appraiser during his inspection of the property, except that the head or governing body of the entity acquiring real property, if so mandated by federal law or regulation, may prescribe a procedure to waive the appraisal in cases involving the acquisition by sale or donation of property with a low fair market value as such value is defined by federal law or regulation.
3. Before the initiation of negotiations for real property, an amount shall be established which is reasonably believed to be just compensation therefor and such amount shall be promptly offered for the property. In no event shall such amount be less than the approved appraisal of the fair market value of such real property. Any decrease or increase in the fair market value of real property prior to the date of valuation caused by the public improvement for which such property is acquired, or by the likelihood that the property would be acquired for such improvement, other than that due to physical deterioration within the reasonable control of the owner, will be disregarded in determining the compensation for the property. The owner of the real property to be acquired shall be provided with a written statement of, and summary of the basis for, the amount established as just compensation. Where appropriate, the just compensation for the real property acquired and for damages to remaining real property shall be separately stated.
4. No owner shall be required to surrender possession of real property before the agreed purchase price is paid or deposited with the state court, in accordance with applicable law, for the benefit of the owner of an amount not less than the approved appraisal of the fair market value of such property, or the amount of the award of compensation in the condemnation proceeding of such property.
5. The construction or development of a public improvement shall be so scheduled that, to the greatest extent practicable, no person lawfully occupying real property shall be required to move from a dwelling, assuming a replacement dwelling, as required by the Oklahoma Relocation Assistance Act, will be available, or to move his business or farm operation without at least ninety (90) days’ written notice from the date by which such move is required.
6. If any owner or tenant is permitted to occupy the real property acquired on a rental basis for a short term or for a period subject to termination on short notice, the amount of rent required shall not exceed the fair rental value of the property to a short-term occupier.
7. In no event shall the time of condemnation be advanced, on negotiations or condemnation and the deposit of funds in court for the use of the owner be deferred, or any other coercive action be taken to compel an agreement on the price to be paid for the property.
8. If an interest in real property is to be acquired by exercise of power of eminent domain, formal condemnation proceedings shall be instituted. The acquiring authority shall not intentionally make it necessary for an owner to institute legal proceedings to prove the fact of the taking of his real property.
9. If the acquisition of only part of the property would leave its owner with an uneconomic remnant, an offer to acquire that remnant shall be made. For the purposes of this section, an uneconomic remnant is a parcel of real property in which the owner is left with an interest after the partial acquisition of the property of the owner which has little or no value or utility to the owner.
10. A person whose real property is being acquired in accordance with this title may, after the person has been fully informed of his right to receive just compensation for such property, donate such property, any part thereof, any interest therein, or any compensation paid therefor, as such person shall determine.
11. As used in this section:
12. “Appraisal” means a written statement independently and impartially prepared by a qualified appraiser setting forth an opinion of defined value of an adequately described property as of a specific date, supported by the presentation and analysis of relevant market information; and
13. “Acquiring agency” means:

(1) a state agency which has the authority to acquire property by eminent domain pursuant to state law, and

(2) a state agency or person which does not have such authority, to the extent provided by regulation.

Section 18 – Landowner’s Bill of Rights

1. The Attorney General shall prepare a written statement that includes a “Landowner’s Bill of Rights” for a property owner whose real property may be acquired by a person, acquiring agency, or other entity through the use of the entity’s eminent domain authority under Title 27 or Title 66 of the Oklahoma Statutes. The statement shall be made available to the public and written in plain language designed to be easily understood by the average property owner.
2. The Landowner’s Bill of Rights shall notify each property owner of the right to:
3. Notice of the proposed acquisition of the owner’s property;
4. A bona fide good-faith effort to negotiate by the entity proposing to acquire the property;
5. An assessment of damages to the owner that will result from the taking of the property;
6. A hearing under Title 27 of the Oklahoma Statutes, including a hearing on the assessment of damages; and
7. An appeal of a judgment in a condemnation proceeding, including an appeal of an assessment of damages.
8. The statement shall include:
9. The title “Landowner’s Bill of Rights”; and
10. A description of:
11. the condemnation procedures provided by Title 27 of the Oklahoma Statutes,
12. the condemning entity’s obligations to the property owner, and
13. the property owner’s options during a condemnation, including the property owner’s right to object to and appeal an amount of damages awarded.

Section 14 – Buildings, Structures and other Improvements – Taking with Real Property

1. Where any interest in real property is acquired, an equal interest shall be acquired in all buildings, structures or other improvements located upon the real property which are required, by the head of the acquiring entity, to be removed from such real property or which he determines to be adversely affected by the use to which such real property will be put.
2. For the purpose of determining the just compensation to be paid for any building, structure or other improvement required to be acquired as by subsection A of this section, such building, structure or other improvement shall be deemed to be a part of the real property to be acquired notwithstanding the right or obligation of a tenant, as against the owner of any other interest in the real property, to remove such building, structure or improvement at the expiration of his term, and the fair market value which such building, structure or improvement contributes to the fair market value of the real property to be acquired or the fair market value of such building, structure or improvement for removal from the real property, whichever is the greater, shall be paid to the tenant therefor.
3. Payment under this section shall not result in duplication of any payments otherwise authorized by law. No such payment shall be made unless the owner of the land involved disclaims all interest in the improvements of the tenant. In consideration for any such payment, the tenant shall assign, transfer and release to the acquiring entity all his right, title and interest in and to such improvements. Nothing in this section shall be construed to deprive the tenant of any rights to reject payment under this section and to obtain payment for such property interests in accordance with applicable law other than this section.

Section 16 – Right to Just Compensation – Definition

1. In every case wherein private property is taken or damaged for public use, the person whose property is taken or damaged shall be entitled to just compensation.
2. “Just compensation”, as used in subsection A of this section, shall mean the value of the property taken, and in addition, any injury to any part of the property not taken. Any special and direct benefits to the part of the property not taken may be offset only against any injury to the property not taken. If only a part of a tract is taken, just compensation shall be ascertained by determining the difference between the fair market value of the whole tract immediately before the taking and the fair market value of that portion left remaining immediately after the taking.

  Oklahoma Constitution

    Article 2 – Bill of Rights

        Section Article 2 section 23 – Private property – Taking or damaging for private use

• 23. Private property – Taking or damaging for private use.

No private property shall be taken or damaged for private use, with or without compensation, unless by consent of the owner, except for private ways of necessity, or for drains and ditches across lands of others for agricultural, mining, or sanitary purposes, in such manner as may be prescribed by law.

Section Article 2 section 24 – Private property – Public use – Character of use a judicial question

• 24. Private property – Public use – Character of use a judicial question.

Private property shall not be taken or damaged for public use without just compensation. Just compensation shall mean the value of the property taken, and in addition, any injury to any part of the property not taken. Any special and direct benefits to the part of the property not taken may be offset only against any injury to the property not taken. Such compensation shall be ascertained by a board of commissioners of not less than three freeholders, in such manner as may be prescribed by law. Provided however, in no case shall the owner be required to make any payments should the benefits be judged to exceed damages. The commissioners shall not be appointed by any judge or court without reasonable notice having been served upon all parties in interest. The commissioners shall be selected from the regular jury list of names prepared and made as the Legislature shall provide. Any party aggrieved shall have the right of appeal, without bond, and trial by jury in a court of record. Until the compensation shall be paid to the owner, or into court for the owner, the property shall not be disturbed, or the proprietary rights of the owner divested. When possession is taken of property condemned for any public use, the owner shall be entitled to the immediate receipt of the compensation awarded, without prejudice to the right of either party to prosecute further proceedings for the judicial determination of the sufficiency or insufficiency of such compensation. The fee of land taken by common carriers for right of way, without the consent of the owner, shall remain in such owner subject only to the use for which it is taken. In all cases of condemnation of private property for public or private use, the determination of the character of the use shall be a judicial question.

THE STATE OF OKLAHOMA

LANDOWNER’S BILL OF RIGHTS

PREPARED BY THE

OFFICE OF THE ATTORNEY GENERAL OF OKLAHOMA

STATE OF OKLAHOMA LANDOWNER’S BILL OF RIGHTS

This Landowner’s Bill of Rights applies to any attempt by the government or a private entity to take your property through a condemnation or other legal proceeding. Generally, the laws applicable to the Landowner’s Bill of Rights can be found in Titles 27 and 66 of the Oklahoma Statutes.

• You are entitled to receive just compensation if your property is taken for a public
• Your property can only be taken for a public
• Oklahoma law prohibits the taking of your property solely for economic
• Your property can only be taken by a governmental entity or  private entity authorized by law to do
• The entity must notify you that it wants to take your
• The entity proposing to take your property must make a bona fide effort  to negotiate to buy the property before it files a lawsuit to condemn the property – which means the condemning entity must make a good faith offer that conforms within Titles 27 and 66 of the Oklahoma
• You may hire an appraiser or other professional to determine the value of your property or to assist you in any condemnation
• You may hire an attorney to negotiate with the condemning entity and to represent you in any legal proceedings involving the
• Before your property is condemned, you are entitled to a copy of the commissioners’ report which determines the injury you may sustain by the condemnation of your property and the amount of just compensation entitled to
• If you are unsatisfied with the compensation awarded by the commissioners’ report, or if you question whether the taking of your property was proper, you have the right to a trial by a jury or review by the district court judge. If you are dissatisfied with the trial court’s judgment, you may appeal that

CONDEMNATION PROCEDURE

Eminent domain is the legal authority certain entities are granted that allows those entities to  take private property for a public use. Private property can include land and certain improvements that are on that property.

Private property may only be taken by a governmental entity or private entity authorized by law to do so. Your property may be taken only for a public use. That means it can only be taken for a purpose or use that serves the general public. Oklahoma law prohibits the taking of your  property solely for economic development.

Your property cannot be taken without just compensation. Just compensation includes the  market value of the property being taken. It may also include certain damages if your remaining property’s market value is diminished by the acquisition itself or by the way the condemning entity will use the property.

HOW THE TAKING PROCESS BEGINS

The taking of private property by eminent domain must follow certain procedures. First, the entity that wants to condemn your property must notify you. Since additional  requirements apply to entities using government funds when exercising eminent domain, the entity must also specify to you whether they intend to use government or private funds for the taking.**

Second, the condemning entity must make a bona fide effort to negotiate with you to purchase the property. You have the right to discuss the negotiation with others and to either accept or reject any offer made by the condemning entity.

CONDEMNATION PROCEEDINGS

If you and the condemning entity do not agree on the value of your property, the entity may begin condemnation proceedings. Condemnation is the legal process that eligible entities utilize to take private property. It begins with a condemning entity filing a petition for condemnation in district court, in the county where the property is located.

COMMISSIONERS’ REPORT

After the condemning entity files a condemnation claim in court, and after ten (10) days’ notice to you, the judge will appoint three disinterested landowners to serve as commissioners. These commissioners must take an oath to perform their duties impartially and justly. The commissioners are not legally authorized to decide whether the condemnation is necessary or if the public use is proper. Their role is limited to assessing just compensation for you.

After being appointed, the commissioners will inspect the property and consider the injury you may sustain by the taking. The commissioners must make a report in writing which determines the quantity, boundaries and just compensation of your property that is being taken. The commissioners must give their report to the district court clerk, who will file and record the

report. Once the commissioners’ report is filed, the district court clerk has ten (10) days to forward a copy of the commissioners’ report and a notice of time limits for review and appeal to all parties. After the commissioners’ report is filed, the condemning entity may take possession of the condemned property, even if either party seeks judicial review of the award. To take possession of your property, the condemning entity must first pay the county clerk the amount assessed and reported by the commissioners.

The commissioners’ report is significant to you not only because it determines the amount that qualifies as just compensation, but also because it impacts who pays the cost of the condemnation proceedings, as noted in the next section.

OBJECTION TO THE COMMISSIONERS’ REPORT

If either the landowner or the condemning entity disagrees with the commissioners’ award, two options are available. Either party may file written exceptions or objections with the district  court clerk’s office within thirty (30) days after the report is filed. If an exception/objection is filed, the court must confirm the awarded amount, reject the awarded amount, or order a new appraisement if either party shows good cause. Alternatively, either party may submit a written demand for a jury trial with the district court clerk’s office, within sixty (60) days after the report is filed. If you wish to make this objection, you must file it in writing with the court. If either party demands a jury trial, the trial will be conducted in the same manner as other civil actions are conducted in district court and the jury will assess the amount of damages from the taking. If the party demanding the jury trial does not receive a verdict more favorable to him than in the commissioners’ report, then that party may be required to pay all district court costs.  This means, if you demand a jury trial and the jury determines the commissioners’ award was sufficient, you might be required to pay all the district court costs related to the jury trial.

Either party may ask the court to extend the time limit for filing an exception or demand for jury trial if the court clerk failed to give notice within ten (10) days from the report filing. The court may extend the time for filing to up to twenty (20) days after the application is heard.

RIGHT TO APPEAL

After trial, either party may appeal any judgment entered by the court to the Supreme Court of Oklahoma. If you appeal the judgment, you will be liable for the costs of the appeal, unless the Supreme Court determines you are entitled to a greater amount of damages than the commissioners awarded.

**EMINENT DOMAIN WITH GOVERNMENTAL FUNDS

When an entity uses federal, state, or local funds to acquire your private property for public use, the entity must comply with additional procedures before beginning the condemnation process. First, the entity must appraise the real property before initiating negotiations to purchase your property. The entity must give you the opportunity to accompany the appraiser during the

inspection of your property, unless a federal law provides an exception. Second, after the appraisal, the entity must promptly offer you an amount reasonably believed to be just compensation. This amount cannot be less than the amount of the approved appraisal of the fair market value of the real property. The entity must provide you a written statement of the established just compensation amount they are offering you and a summary of how the entity came to this conclusion. If it is determined that damages to your remaining property will occur, the just compensation offered to you for those damages must be stated separately.

You will not be required to surrender possession of your real property to the condemning entity, even if you accepted the approved offer price or, after the condemnation proceedings, the compensation award amount has been determined, until the condemning entity pays the agreed purchase price or deposits the purchase price with the state court.

If the property taken is your dwelling, business or farm operation, the condemning entity must give you at least ninety (90) days’ written notice from the date you are required to move from your dwelling or move your business or farm operation to another location.

The statute forbids the condemning entity from taking any coercive action to compel you to agree on the price of your property. This means that the entity cannot advance the time of condemnation nor can the entity postpone depositing the fund in court for your use.

You have the right to donate your property or compensation paid, if you choose, after you have been fully informed of your right to just compensation.

If private property was condemned with the use of governmental funds, and the property is not used for the purposes for which it was condemned or for another public use, this property is called surplus property. You have the right of first refusal to the surplus property. This means you have the right to purchase the surplus property at the appraised value or the original price at which the entity purchased that portion of the property, whichever is less, before anyone else.

REIMBURSEMENT OF EXPENSES AFTER ACQUISITION   

The condemning entity must, as soon as practicable after paying the purchase price, reimburse you for certain expenses you incur as a result of the taking. These expenses  include:  1) recording fees, transfer taxes and similar expenses incidental to conveying your real property; 2) penalty costs for prepaying your preexisting recorded mortgage; and 3) their pro rata portion of real property taxes paid.

REIMBURSEMENT OF EXPENSES IN OTHER INSTANCES

The court may also determine that the condemning entity must reimburse you for your reasonable attorney, appraisal, engineering and expert witness fees, you actually incurred because of the condemnation proceedings, if the entity abandons the proceedings or where the final judgment is that your property cannot be acquired through condemnation. The court may also award these expenses if the jury award exceeds the commissioners’ award by at least ten percent (10%).

DISCLAIMER

The information in this statement is intended to be a summary of the applicable portions of Oklahoma state law as required by HB 1562, enacted during the Oklahoma 2012 Regular Session. This statement is not legal advice and is not a substitute for legal counsel.

ADDITIONAL RESOURCES

Further information regarding the procedures, time-lines and requirements outlined in this document can be found in Oklahoma Statutes Title 27 Eminent Domain and Chapter 2 of Title 66 Railroads. Other Statutes regarding eminent domain can be found in Oklahoma Statutes  Titles 11, 52, 60, 69, 70 and 74.

Mineral Interest Probate:

Often a property is inherited but title is not in the name of the heirs.  Generally, a company will require a probate before they begin paying royalties.  Or, a buyer will make probate a title requirement.  Very often, the process is simple for the heirs.  It is also rare that any heir is needed to make a court appearance or travel to Oklahoma.  Finally, many times a mineral only probate is eligible for a summary process which saves time and money.

Get Oil & Gas Help

Lease Terms / Negotiation

The devil is in the detail in Oil and Gas leases.  It is important to bargain for the best deal because you can be bound by the contract for decades to come.

Pooling Orders:

Sample heading for an Oklahoma Commission Case.A pooling is a legal process that can force mineral owners to allow development of their minerals.  This is generally used for people who don’t sign a lease or cannot be found.  Fighting forced pooling can be expensive and often futile.  However, a mineral owner still has rights.  If a pooling order is allowed, an owner is given various options.  We explain the pros and cons of the choices offered.  There is typically a time sensitive choice to make.

Simple Probate Avoidance:

People who go through probate often want to save their family from that trouble.  Here are a few ways to avoid probate.

Transfer on Death Deed: 

This is a simple, inexpensive document where you name the person you want to receive your land or minerals after you are gone.  In the meantime, you maintain complete control.  You can lease or sell the property and don’t need anybody’s approval.  After death, the person(s) named files a form with your death certificate and receives the property.  There is no probate or court process.  This works even if you don’t have a Will.

Joint Tenancy:

Joint Tenancy creates an ownership interest in the property in equal shares.  When one joint tenant dies, the other files a form with a death certificate in order.  This removes the deceased person from the title.  However, unlike the Transfer on Death Deed, the person making the deed gives up an ownership interest.  It is generally used by spouses when purchasing a homestead.

Trust:

A trust avoids probate if the minerals (or other real property) is deeded into it. An owner can create a trust the preserves all of his or her rights.  It does not require any separate tax return.

Out of State Trusts:

Too often, out-of-state owners fail to transfer their minerals into their trust.  As a result, those assets become subject to probate.  Creating a mineral deed into a trust is considered the practice of law in Oklahoma. Therefore, an attorney not licensed in Oklahoma cannot prepare the deed.  We can assist in the preparation and filing of the needed forms.

  Frequently individuals on the Mineral Rights Forum have posts that involve issues concerning title or the transfer of ownership after death.  The purpose of this paper is to provide some information regarding issues and common questions.  This is not legal advice as your situation may require different actions.

Frequent Questions:

What is probate?

We had a probate in our home state;  why must we probate in Oklahoma?

What if there was a trust?

Why was the company willing to lease and pay a bonus but is now unwilling to pay royalties?

Why won’t the company accept an affidavit of heirship?

What does a probate cost?

What is Ancillary Probate?

What if there has never been a probate?

What is the difference between a Summary and Ancillary Probate?

Will I have to travel to Oklahoma?

How long is the process?

What about Estate Taxes?

What is probate?

As it relates to a person who stands to inherit property, it is a process by which title to property is transferred from the deceased owner to his or her heirs or according to a Will.

We had a probate in our home state;  why must we probate in Oklahoma?

Simply put, it has to do with jurisdiction.  A court of one state does not have authority over real property (including mineral interest) in another.  Therefore, a court outside of Oklahoma cannot award title.  Only an Oklahoma Court can do that.

What if there was a trust?

A trust avoids probate only if property is transferred to the trustee prior to death.  If an interest is titled in the name of the decedent, instead of a trust, then probate will be required.  Typically, those with trusts also create a will.  This will instructs the probate court to transfer assets to the trust.

Why was the company willing to lease and pay a bonus but is now unwilling to pay royalties?

It is not uncommon for a company to take certain risks in order to secure a lease because it provides it with valuable rights.  However, if there is production a “division order analyst” will examine the title to the property.  If there are defects, such as an unprobated estate, the analyst will place payment of royalties in suspense.  This means that the monies will be held until the title issue is resolved.

Why won’t the company accept an affidavit of heirship?

In Oklahoma, an affidavit of heirship must meet five criteria to be deemed to provide “marketable title”.[i]  The biggest hurdle is the requirements is that an affidavit must be on file for 10 years.   Therefore, it is usually best to go forward with a probate if royalties are in suspense.

What does a probate cost?

There are several components that make up the expenses related to a probate.  These are:

• Filing fees
• Publication Fees
• Postage
• Attorney fees
• Recording fees

Often attorneys are willing to probate mineral interests on a flat fee basis.  That means the expenses listed above are rolled. Into one price.

What is Ancillary Probate?

Generally, this is available if there has already been a probate in another state.  It requires certain documents from the original court.  Once these are assembled, then the process is very quick.

What if there has never been a probate?

If there has not been a probate, generally a shortened “summary probate” procedure is used.  It is available if:

• The decedent has been dead five or more years; or
• The decedent lived outside Oklahoma at his or her death; or
• The value of property within Oklahoma is valued at $200,000 or less.

What is the difference between a Summary and Ancillary Probate?

For the client, there is really no difference.  The summary probate requires a slightly longer timeframe and requires slightly different publication requirements.  In short, it is something that the attorney, as opposed to the client, handles.

Will I have to travel to Oklahoma?

While we would love to have you, the answer is no.  It is extremely rare that anybody other than the attorney need attend a hearing.  Paperwork can be handled through mail or email.

How long is the process?

Once the paperwork is signed and filed, the process can take as little as 30 days (for an ancillary probate) or about 75 days for a summary probate.  These estimates may vary depending upon court availability.

What about Estate Taxes?

Oklahoma abolished its estate tax beginning January 1, 2010.  For those who died prior to 2010, often a release can be obtained or the tax expired due to the lapse of time.

Federal estate taxes are rarely an issue since the taxable amount begins at relatively high levels.

[i] 17-O.S. §67(C) says:  . In order to establish marketable title pursuant to this section:

1. The affidavit or recital must state that the decedent died without a will, or if the decedent had a will, that the will was never probated in Oklahoma and a copy of the will is attached to the affidavit or recital, or if the will was probated that the severed mineral interest was omitted from the final decree of the decedent and a copy of the will and final decree is attached to the affidavit or recital;

2. The affidavit or recital must list the names of the decedent’s heirs and their relationship to the decedent;

3. The affidavit or recital must state that the maker is related to the decedent or otherwise has personal knowledge of the facts stated therein;

4. The affidavit or the title transaction that contains the recital must have been recorded for at least ten (10) years in the office of the county clerk in the county in which the real property is located; and

5. During the ten-year period following the recording of the affidavit or the title transaction that contains the recital, no instrument inconsistent with the heirship alleged in the affidavit or recital was filed in the office of the county clerk in the county in which the real property is located.

Many mineral owner receive paperwork that looks like a lawsuit with the name of the Oklahoma Corporation Commission.  The application seeks relief called pooling.  This article is designed to explain some basic about the process.  This is general information and should not be used as a substitute for legal advice.

What Does “Relief Sought Pooling” Mean?

Sample heading for an Oklahoma Commission Case.

Quite simply, this is a process that allows a company to drill for oil and gas even if they don’t have leases (permissions) from everybody that owns an interest in them.  Basically, it is almost impossible for everyone to agree to drill or to agree upon the company who should take on that task.  The company who filed the “Pooling Application” is seeking governmental permission to drill.

If an interest owner has not signed a lease, the company that applied will be required to pay the mineral interest “Consideration” or Bonus in the form of a lump sum plus a fractional interest in the oil and gas produced from the well or wells.

Is This the Same as “Forced Pooling”?

Yes.

Why did I get This Application?

The most likely reason you received the application is because your minerals are not subject to an active lease.  Either there was never a lease or a previous lease expired.

What is the Oklahoma Corporation Commission?

The Corporation Commission is an Oklahoma Agency that regulates various industries such as utilities, railroads, pipelines and oil and gas production.

Why did I get This Notice From the Corporation Commission?

You probably have a mineral interest in an area in which the company wishes to drill.  Prior to making the application the company is supposed to identify all discoverable mineral interest owners.  The company is required to search records including land records, probate cases to identify those owners.  If you receive notification from any Oklahoma Corporation oil and Gas case,  there is a strong likelihood that you have a mineral interest in that property.

What Am I Supposed to Do?

There are several basic strategies for a Mineral Interest Owner:

1.  Enter and Appearance and Notice of Protest.  This will insure that you receive all notices in the case.  Then there is the issue of what you are to protest.  You could protest the applicant, the Consideration or Bonus to be awarded owners or other issues.  You would need to be prepared to have evidence to support your position.  This may include lease offers you or neighbors have received.  You would probably need an expert such as a Landman.  This strategy may be best utilized by an interest holder with a large amount of acreage at stake.  This may enable you to obtain a lease on more favorable grounds than previously offered.

2. Negotiate a Lease.  You can attempt to negotiation a lease with the applicant or another entity.

3. Monitor the Case.  This is recommended no matter what else you do.  Once an order is entered you may have as little as 20 days to make the best election.  See all filings in the case here.

4. Take No Action. You are not required to take any action.  If you fail to do anything you will still own your minerals, however once an order is entered it will be subject to the forced pooling order.  In other words, you will not lose your property but will become subject to the final order.  The order will require the company to pay you for production.

Sample Pooling Order

Once a final order is entered you will receive an order.  It will include several Bonus or Consideration options.  These tend to be confusing.  If you don’t make a timely an election, the order will authorize the company to assign you the smallest royalty.

Can I Still Sell or Lease my Interest?

Yes, you can sell your interest before, during or after the pooling application.  However, companies do not typically go to the expense of a pooling application unless they intend to drill.

Am I Being Sued?

Sort of.  The company is not asking that your pay anything.  However, this is a legal process that can affect your interest namely once pooled you will not be able to lease your property.  Also the Commission will determine the bonus and royalty that you will receive.  It is therefore important to understand the process.

What if the Person Named on the Notice is Deceased?

If the person named as a respondent is deceased then his or her heirs or persons named in that persons estate plan (Will or Trust) should immediately take steps to insure that they are recognized as the owners.  This will often mean filing a probate.    Part of the probate process is to name a representative of the estate who can have authority to deal with the property.  It is preferable that this occur prior to the final order so that the heir will be able to make an election.

How Long Will the Pooling Be Binding?

A pooling order will state the time that operations for drilling a well must begin.  If the drilling has not begun then the mineral interest owner is released from that obligation.  The company must still pay the cash bonus or consideration.  The order can last indifferently if the well is drilled and there is continued production.

Do I Have to Appear at Hearings?  Can I Fight This?

While you have the right to appear and represent yourself, the process is difficult to understand.  Unless you have significant mineral holdings at stake, it is probably not worthwhile to hire an attorney to attend the hearing.

In most circumstances you are unlikely to be able to prevent the drilling of a well.

What is “Relief Granted and Election Period”?

This is the section that defines the deadline for you to make an “election” under the order.  Typically it will be broken into two major sections:

Participate:

This means that you can invest in the well.  Instead of paying you anything you agree to pay your pro-rata share of the costs of drilling the well.  Instead of a royalty, you will be paid a pro-rata share of the net revenues.  So if you own 40 acres in a 640 spacing unit, you will be responsible for 1/16h of all the costs but be entitled to 1/16th of all of the net revenue.  Your decimal interest in the well would be .0625.

“Cash Consideration” or Bonus and Royalty:

Cash Consideration a “lease bonus” it is a onetime payment.  Usually three or more Cash options are offered.  A small royalty interest will have larger cash option.  Conversely, a large royalty will have a smaller cash option.

Assuming a 40 acres interest in a 640 acre spacing you would be entitled to the following decimal share of the net revenue:

1/8  = .0078125

3/16 = 01174875

1/5 = .0125

1/4 = .015625

How Long do I Have to Make My Election?

A pooling order shall contain language to the effect that the respondents shall have at least twenty (20) days from the date of the order in which to communicate an election to the applicant or other responsible person as to the option selected.

Is it Expensive to Have My Options Reviewed?

No, this can be done on a flat fee basis.

What if I Don’t Elect an Option?

If an owner does not make an election or fails to make it timely, then the order will typically state that the owner has deemed to have elected the highest cash bonus (consideration) and the smallest royalty interest.  By law the company is only required to give you 20 days from the entry of the order so time is of the essence.

What is a Multiunit Horizontal Well?

A horizontal well is the technology that allows greater production from a mineral producing zone.  Instead of simply drilling straight down, the pipe is curved into an oil and gas formation to have the maximum contact and greater production.  Multiunit means a well that will send casing pipe in different directions from one rig.

What is a “Well Location Exception”?

In Oklahoma wells must be a certain distance from each other.  A Well Location Exception seeks a variance because of geography, topography or economics.  Permission must be granted by the Commission.

This is general information and should not be used as a substitute for legal advice.

Get Oil & Gas Help