Oil and Mineral Rights in Divorce in Texas
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Dividing Oil and Mineral Rights in Divorce Settlements
Oil and Mineral Rights in Divorce
While it is well-known that a divorcing couple needs to split their shared assets, many people may not realize the extent of this process. In addition to dividing tangible assets, the court must also decide how to allocate assets such as oil or mineral rights in a divorce. These assets are often of high value, and individuals seeking a divorce may benefit from seeking legal advice to determine how this property will be affected by the dissolution of their marriage.
Community Property in Texas
In Texas, community property is subject to equitable division when a couple gets divorced. Community property refers to property that belongs to both spouses equally, which can include income, interest on bank accounts, and oil or mineral rights acquired during the marriage, with some exceptions such as property obtained through inheritance or a gift, or precluded from becoming community property via a prenuptial or postnuptial agreement, and property awarded as damages for bodily harm in a civil lawsuit. Anything not considered community property is classified as separate property, which includes property owned by either spouse before the marriage. It is important to note that equitable division of community property does not always mean an equal division.
Determining Oil and Mineral Rights in Divorce
Real estate in Texas is divided into surface rights and mineral rights. The former grants ownership of the land and everything on it, while the latter allows control of anything below the surface, including oil, minerals, and water. When a couple decides to divorce, they must determine the value of both surface and mineral rights before dividing the real estate equitably. It can be challenging to divide mineral rights when one or both parties lease them to third parties. A skilled divorce attorney can assist in determining how bonuses, royalty, and working interest payments are allocated in such cases. If mineral rights are jointly owned, they are community property subject to equitable distribution. If one spouse solely owns the mineral rights, they will likely retain ownership after the divorce. In Texas, oil royalties are not considered income, but are treated as proceeds from the sale of the land. Therefore, if mineral rights are separate property, royalties are also separate property.
Speak with an Experienced Divorce Attorney
Dividing assets such as oil and mineral rights in a divorce can be complex, and it's crucial for anyone pursuing a marital dissolution to consult with an attorney about their choices. At Wilson Whitaker Rynell, we have extensive experience assisting clients in securing a fair division of assets, and we are committed to advocating aggressively for your interests. Our firm represents clients in divorce cases in various Texas cities, including Dallas, Austin, Houston, Fort Worth, and all cities within Dallas County, Tarrant County, Collin County, and Denton County.
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