SRC-AXB, JBJ S.B. 436 76(R)BILL ANALYSIS


Senate Research CenterS.B. 436
By: Nixon
Jurisprudence
6/30/1999
Enrolled


DIGEST 

Currently, a citizen may sign away the mineral rights to a property upon
receiving a check accompanied with ambiguously worded correspondence.  Some
companies send a check with ambiguously worded correspondence to a resident
whose mineral rights the companies wish to purchase.  At times, some
citizens, particularly senior citizens, may cash or deposit a check without
the understanding that to do so may forfeit their mineral rights to the
property.  S.B. 436 requires an instruments of conveyance to contain
certain conspicuous statements regarding mineral rights.  S.B. 436 also
requires the rights to be rescinded if the statement was not included in
the letter or if the mineral rights holder is over 65 years. 

PURPOSE

As enrolled, S.B. 436 requires a disclosure to be included in certain
offers by mail to purchase mineral or royalty interests. 

RULEMAKING AUTHORITY

This bill does not grant any additional rulemaking authority to a state
officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Chapter 5, Property Code, by adding Subchapter F, as
follows: 

SUBCHAPTER F.  REQUIREMENTS FOR CONVEYANCES OF MINERAL INTERESTS

Sec. 5.151.  DISCLOSURE IN OFFER TO PURCHASE MINERAL INTEREST.  Requires a
person who mails an offer to purchase mineral or royalty interests,
encloses an instrument of conveyance of the interests, and a draft or other
instrument as defined in Section 3.104, Texas Business and Commerce,
providing for payment to include in the offer certain conspicuous
statements.  Sets forth a form for the statement.  Authorizes the conveyor
of the interest to sue the purchaser under certain circumstances.
Authorizes the prevailing plaintiff to recover certain costs and fees, up
to a certain amount.  Requires the suit to be brought by a certain date.
Requires the remedy provided to be in addition to any other remedies
existing under law, excluding rescission or other remedies that would make
the conveyence of the mineral or royalty interest void or of no force and
effect. 

SECTION 2.Effective date: September 1, 1999.
  Makes application of this Act prospective.

SECTION 3.Emergency clause.