House Bill No. 69

Introduced By hagener, bartlett

A Bill for an Act entitled: "An Act substituting the department of revenue for district clerks of court as trustee of trusts for unlocatable mineral owners; and amending sections 82-1-302, 82-1-304, 82-1-305, and 82-1-306, MCA."

Be it enacted by the Legislature of the State of Montana:

Section 1.  Section 82-1-302, MCA, is amended to read:

"82-1-302.   Creation of trust for unlocatable mineral, leasehold, or royalty interest owners. (1) Any person who owns an interest in minerals underlying a tract of land may petition the district court of the county in which the tract or a portion of the tract is located to declare a trust in favor of a person or other persons also owning or claiming an interest in the minerals underlying the tract if their place of residence and present whereabouts is unknown and cannot reasonably be ascertained.

(2)  In requesting the appointment of a trustee, the petitioner must shall show that:

(a)  a diligent but unsuccessful effort to locate the absent owner or claimant has been made; and

(b)  appointment of a trustee will be in the best interest of all owners of an interest in the minerals.

(3)  After determining that the conditions of subsection (2) have been met, the court shall appoint the clerk of court department of revenue as a trustee and shall authorize him the department to execute and deliver an oil, gas, or other mineral lease, a ratification, a division order, or any other related document or instrument on such the terms and conditions as the court may approve."

Section 2.  Section 82-1-304, MCA, is amended to read:

"82-1-304.   Administration of the trust. (1) The administration of the trust shall must comply with the appropriate provisions regulating trusts contained in Title 72.

(2)  No trustee Trustee or attorney fees may not be paid from the trust proceeds.

(3)  All bonuses, rental payments, royalties, and other income shall must be paid to the trustee until the trust is terminated and notice of its termination given to all interested parties. The trustee shall distribute all money held in the trust to the person or persons entitled to it the money upon the order of the district court.

(4)  A trust in favor of unlocatable owners shall must be kept in force until the unlocatable owners of the mineral interest in question have successfully claimed the their share of the funds held in trust and have filed the notice, as provided in 82-1-306.

(5)  The trustee shall invest funds under his management in the a prudent manner of a prudent man, as provided in 72-34-114. Fifty percent of the interest earned on each trust shall must be credited to the general fund of the county in which the mineral interest is located department of revenue to defray the costs of administration.

(6)  Funds held in the trusts are subject to the provisions governing abandoned property contained in Title 70, chapter 9."

Section 3.  Section 82-1-305, MCA, is amended to read:

"82-1-305.   Existing trust Trust for unlocatable mineral, leasehold, and royalty interest owners -- transfer of trustees -- penalty. (1) Any bonuses, rental payments, royalties, and other income now held by any person or association for unlocatable owners or claimants of an interest in minerals underlying a tract of land must be deposited with the clerk of the district court in which the tract is located within 6 months after July 1, 1979. An accounting for the funds, any related documents, and any instrument creating a trust must be filed with the funds.

(2)(1)  No A person may not personally hold for longer than 6 months any bonuses, rental payments, royalties, and or other income for unlocatable owners or claimants of an interest in minerals underlying a tract of land., but in such case Within the 6-month period, the person must shall petition the district court for creation of a trust, as provided in 82-1-302.

(3)(2)  If any A person fails failing to comply with subsection (1) or (2), he is liable for all attorney fees and court costs and interest on such funds subject to subsection (1) at twice the current average passbook account rate paid by financial institutions in that any district in which the property or part of the property is located."

Section 4.  Section 82-1-306, MCA, is amended to read:

"82-1-306.   Filing of addresses. (1) Upon the payment of a $5 fee, any a person claiming an interest in minerals underlying a tract of land which that is the subject of a trust proceeding under 82-1-302 may file with the clerk and recorder of each county wherein the mineral interests lie in which the land is located a notice of his containing the person's address and the a legal description of his the person's interest in the minerals. and thereby establish Filing the notice creates a rebuttable presumption that such the person owns the interest claimed.

(2) The clerk and recorder shall forward a copy of the notice to the department of revenue."