11.025 Possible Adverse Mineral Tax Assessment

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Requirement 11.025

Possible Adverse Mineral Tax Assessment

 

Possible Adverse Mineral Tax Assessment (Tract 2).  The mineral tax chain and current mineral tax assessment listing for 2007 show a possible adverse tax assessment as to the coal claimed by John Q. Owner in Tract 2.  Although John Q. Owner is assessing and paying taxes on the coal in Tract 2, Susie Interloper is also assessing and paying taxes on the minerals under Tract 2.   The assessment status is of interest to you, for a number of reasons.  For example,  to protect John Q. Owner’s  right to commence an in rem bill to quiet title under the Grove Act, Section 6-5-560, Code of Alabama (1975), John Q. Owner must exclusively assess and pay taxes on the coal.  The Susie Interloper assessment could deny John Q. Owner the ability to clear title through the Grove Act.  Also, a Susie Interloper default in the payment of taxes could lead a tax sale of the coal underlying Tract 2.  We assume that John Q. Owner monitor published tax sale notices and would not allow a tax sale of his valuable coal assets.  For that reason, any risk of title loss due to a tax sale of the coal seam may be a reasonable business risk to you.

Requirement:   If  you are unwilling to accept the reasonable business risk of title failure due to a tax sale of the coal seam, please advise us accordingly and we shall supplement this requirement.

Copyright 2011 by Edward G, Hawkins. All rights reserved.