93.55 FORFEITURE OF SEVERED MINERAL INTEREST.
Subdivision 1. Forfeiture; failure to record.
If the owner of a mineral interest fails to
record the verified statement required by section
, before January 1, 1975, as to any interests
owned on or before December 31, 1973, or within one year after acquiring such interests as to
interests acquired after December 31, 1973, and not previously recorded under section
mineral interest shall forfeit to the state after notice and opportunity for hearing as provided in this
section. However, before completing the procedures set forth in subdivision 2, the commissioner
of natural resources may lease the severed mineral interest as provided in subdivisions 1a and 3.
Subd. 1a. Lease of forfeited interest.
If the owner of a severed mineral interest fails to
record the verified statement required by section
before the dates specified in subdivision
1, the commissioner of natural resources may lease the mineral interest as provided in this
subdivision and subdivision 3 before completing the procedures set forth in subdivision 2. In any
lease issued under this subdivision, the commissioner shall cite, as authority for issuing the lease,
this subdivision, subdivision 3, and the United States Supreme Court decision in Texaco, Inc., et
al. v. Short, et al., 454 U.S. 516 (1982), where the Supreme Court determined, under Amendment
XIV to the Constitution of the United States, that enactment of a state law requiring an owner
of severed mineral interests to timely record a statement of claim to the mineral interests was
constitutional, without individual advance notice of operation of the law, before the owner loses
the mineral interests for failing to timely record the statement of claim. A lessee holding a lease
issued under this subdivision may not mine under the lease until the commissioner completes the
procedures set forth in subdivision 2 and a court has adjudged the forfeiture of the mineral interest
to be absolute. "Mine" for the purposes of this subdivision is defined to exclude exploration
activities, exploratory boring, trenching, test pitting, test shafts and drifts, and related activities.
Subd. 2. Notice and hearing.
The commissioner shall notify the last owner of record in
either the county recorder's or registrar of titles' office of a hearing on an order to show cause why
the mineral interest should not forfeit to the state absolutely. The notice shall be served in the
same manner as provided for the service of summons in a civil action to determine adverse claims
under chapter 559 and shall contain the following: (1) the legal description of the property upon
or beneath which the interest exists; (2) a recitation that the statement of severed mineral interest
either did not comply with the requirements specified by section
for such a statement or
was not recorded within the time specified in this section, or both; and (3) that the court will be
requested to enter an order adjudging the forfeiture of the mineral interest to be absolute in the
absence of a showing that there was substantial compliance with laws requiring the registration
and taxation of severed mineral interests. For the purposes of this section, substantial compliance
with laws requiring the registration and taxation of severed mineral interests means: (1) that the
records in the office of the county recorder or registrar of titles specified the true ownership of the
severed mineral interest during the time period within which the statement of severed mineral
interest should have been recorded with the county recorder or the registrar of titles, or that
probate, divorce, bankruptcy, mortgage foreclosure, or other proceedings affecting the title had
been timely initiated and diligently pursued by the true owner during the time period within which
the severed mineral interest statement should have been recorded, and (2) that all taxes relating
to severed mineral interests had been timely paid, including any taxes which would have been
due and owing under section
273.165, subdivision 1
, had the interest been properly recorded as
required by section
within the time specified in this section. For the purposes of this section,
"timely paid" means paid within the time period during which tax forfeiture would not have been
possible had a real property tax been assessed against the property.
Subd. 3. Terms of lease.
The commissioner may lease severed mineral interests described in
subdivision 1 in the same manner as provided in section
, for the lease of minerals and
mineral rights becoming the absolute property of the state under the tax laws, except that no
permit or lease issued pursuant to this section shall afford the permittee or lessee any of the rights
of condemnation provided in section
, as to overlying surface interests.
Subd. 4. Recovery of fair market value.
After the mineral interest has forfeited to the state
pursuant to this section, a person claiming an ownership interest before the forfeiture may recover
the fair market value of the interest, either: (1) as an alternative claim raised in the hearing on the
order to show cause why the mineral interest should not forfeit absolutely, with fair market value
to be determined and paid as provided in this subdivision, or (2) in a separate action brought as
follows. An action may be commenced within six years after entry of judgment under this section
to determine the ownership and the fair market value of the mineral interests in the property
both at the time of forfeiture and at the time of bringing the action. The action shall be brought
in the manner provided in chapter 559, for an action to determine adverse claims, to the extent
applicable. The person bringing the action shall serve notice of the action on the commissioner
of natural resources in the same manner as is provided for service of notice of the action on a
defendant. The commissioner may appear and contest the allegations of ownership and value in
the same manner as a defendant in such actions. Persons determined by the court to be owners of
the interests at the time of forfeiture to the state under this section may present to the commissioner
of finance a verified claim for refund of the fair market value of the interest. A copy of the court's
decree shall be attached to the claim. Thereupon the commissioner of finance shall refund to the
claimant the fair market value at the time of forfeiture, which is the expiration of the period within
which tax forfeiture would not have been possible had the mineral interest been properly and
timely filed for record under section
, or at the time of bringing the action, whichever is
lesser, less any taxes, penalties, costs, and interest which could have been collected during the
period following the forfeiture under this section, had the interest in minerals been valued and
assessed for tax purposes at the time of forfeiture under this section. There is appropriated from
the general fund to the persons entitled to a refund an amount sufficient to pay the refund.
Subd. 5. Applicability.
The forfeiture provisions of this section do not apply to mineral
interests valued and taxed under other laws relating to the taxation of minerals, gas, coal, oil, or
other similar interests, so long as a tax is imposed and no forfeiture under the tax laws is complete.
However, if the mineral interest is valued under other tax laws, but no tax is imposed, the mineral
interest forfeits under this section if not recorded as required by this section.
History: 1969 c 829 s 4; 1969 c 1129 art 10 s 2; 1973 c 492 s 14; 1973 c 650 art 20 s 6; 1979
c 303 art 10 s 1; 1Sp1985 c 14 art 4 s 9; 1988 c 508 s 1-3; 1989 c 277 art 2 s 2; 2005 c 4 s 21-24