AboutDavid B. McCall Expertise Questions regarding oil and gas exploration and production, the operation and management of oil and gas producing properties, and questions related to mineral ownership, title problems, and oil and gas leases.
Experience I am Board Certified in Oil, Gas and Mineral Law in the state of Texas. I have more than 34 years of experience in the industry as both an in house attorney for major oil companies and as a partner in oil and gas firms. I am also a mineral owner and receive royalties from oil and gas production. I have extensive title examination experience, and have represented clients in many administrative and court proceedings.
Organizations State Bar of Texas, Texas Bar Foundation, and Austin Bar Foundation.
Publications Various state bar seminars on Oil and Gas matters.
Education/Credentials I have a business degree in marketing from McMurry University, 1971, and a JD degree from Texas Tech University in 1974, where I graduated 17th in my class. Board Certified in Oil, Gas and Mineral Law in 1986.
Expert: David B. McCall Date: 7/22/2008 Subject: Royalty payments Homestead Texas
Question QUESTION: Hi David, we live in Texas and own our homestead, mineral rights have never been severed from the Homestead . My question is can the company we signed a gas lease with withhold Royalty Payments because of a Credit Card judgement which does not effect the Homestead?
ANSWER: Hello Christy. The company cannot withhold royalty payments because of a judgment. A judgment lien constitutes a lien against real property, not personal property. Because oil and gas proceeds are personal property they pass free of the judgment lien and cannot be withheld. If a company is doing this to you it is wrong and you should demand your money immediately. This is true even if the minerals you leased are not homestead property.
Good luck and let me know if you need any further questions.
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QUESTION: We signed Division Orders but never recieved payment, they said due to a title issue then said it was the judgment, How do you suggest I word the demand letter.
Answer Hello Christy. To expund on Texas law on the judgment issue, here is a statement from a Texas case:
"It is therefore well settled in Texas that “the lien acquired by a recording judgment cannot attach to oil and gas after severance, or to proceeds from oil and gas production."
The oil company is just flat wrong about this. Here are links to the Texas Proceeds Payment Act governing the payment of royalties in Texas:
If a royalty owner notifies you in writing of failure to make timely payment, you must either make payment or respond in writing within 30 days of receipt of the notice.
First, send your letter by certified mail to have a record that the oil company got it.
Second, there is no certain demand language required. Just state that the company has failed to pay you are required by Texas law, that there are no excuses for non payment, and that you intend to seek legal relief if the royalties are not paid. You can quote the language about Texas law if you want to---it makes you look like you have done your homework!
At this point, all you have to do is wait until the company responds. In the meantime, I would be gald to look at your division order or judgment if you think it might be helpful. If so, you can email them to me at davidbmccall@gmail.com.
Good luck and let me know if you have any further question.
