LEGAL GUIDE
Written by attorney John C. Knobelsdorf II | Jun 13, 2013

When there is a sheriff's tax sale - What interest in a mineral estate is conveyed?

What interest in a mineral estate is conveyed at the sheriff’s tax sale? The interest the sheriff’s deed conveys is limited to the property that was subject to tax and set forth in the suit and then in the final judgment. When the order of sale is made, it should refer to only the taxable interest that was the subject to the suit. When the notice of sale is posted, it should refer to only the taxable interest that was the subject to the suit. Then, when the auction is held only the property referred to in the suit gets sold. So, if someone’s only interest in the property was a partial interest in an oil and gas mineral estate and then he does not pay his taxes – only he gets sued and only his partial interest gets conveyed to the new owner. See:

V.T.C.A., Tax Code § 34.01(n) “The deed vests good and perfect title in the purchaser or the purchaser's assigns to the interest owned by the defendant in the property subject to the foreclosure, including the defendant's right to the use and possession of the property, subject only to the defendant's right of redemption, the terms of a recorded restrictive covenant running with the land that was recorded before January 1 of the year in which the tax lien on the property arose, a recorded lien that arose under that restrictive covenant that was not extinguished in the judgment foreclosing the tax lien, and each valid easement of record as of the date of the sale that was recorded before January 1 of the year the tax lien arose. The deed may be impeached only for fraud." (Emphasis added) For example, an old case from West’s Notes of Decisions – Sheriff's deed under tax sale does not affect title of persons not parties to suit. Sanchez v. Hillyer-Deutsch-Jarratt Co. (Civ.App. 1930) 27 S.W.2d 634, error refused. See also, this interesting clarification in Tax Code § 32.02. “Restrictions on a Mineral Interest Tax Lien" (a) If a mineral estate is severed from a surface estate and if different persons own the mineral estate and surface estate, the lien resulting from taxes imposed against each interest in the mineral estate exists only for the duration of the interest it encumbers. After an interest in the mineral estate terminates, the lien encumbering it expires and is not enforceable: (1) against any part of the surface estate not owned by the owner of the interest encumbered by the lien; (2) against any part of the mineral estate not owned by the owner of the interest encumbered by the lien; or (3) against the owner of the surface estate as a personal obligation, unless he also owns the interest encumbered by the lien. (b) Taxes imposed on a severed interest in a mineral estate that has terminated remain the personal liability of the person who owned the interest on January 1 of the year for which the tax was imposed."

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