Very sad to hear about the passing of my colleague David Butler of Magnolia, Arkansas. I met David 10 years ago in Hot Springs. He was representing Chesapeake Exploration at the time, and I remember he introduced his talk as “I’m purely for entertainment.” Boy was he! He had the audience laughing from start to finish. David was witty, charming and not afraid to mix it up in the hearing room. David could spin a yarn like no other. I can’t get over how many hilarious stories the had from his job as prosecuting attorney. I never saw him in a bad mood or with a bad attitude. He will be sorely missed at the annual oil and gas convention in Hot Springs. A link to his obituary is below. No mention of his work as an oil and gas lawyer, but he was one of the best in Arkansas.
“Going through probate” in layman’s terms means appointing a person to oversee the estate called an “administrator” or a “personal representative.” This person serves under supervision of the court for period of at least 6 months. It takes about 1 to 4 weeks to get someone appointed, so as a practical matter, it will take around 7 months to probate an estate in Arkansas in a best case scenario.
It takes as little a day to probate a will in Arkansas, but the will is subject to challenge for 60 days after giving notice by publication in a local newspaper of general circulation in that particular Arkansas county. Probating a will in Arkansas is completely different from administering an estate in Arkansas. That is, it is possible to probate a will in Arkansas without administering an estate in Arkansas and vice versa. If the deceased has money tied up with financial institutions or significant personal property in Arkansas, then it is likely the estate will require an administration. Administration of an estate in Arkansas has the additional benefit of barring the claims of unknown creditors. Thus, where there is real property in the estate–such as a home–and the heirs wish to sell the home immediately, estate administration will allow the home sale to close sooner than if there were no administration.
Clients often call me with a request to probate a will to transfer title to some mineral rights in one of the oil or gas producing Arkansas counties. Many times, the cost of the probate far exceeds the present value of the mineral rights. For those mineral owners, it is too late. The law requires a probate to transfer title if the deceased’s will leaves the property to someone other than the intestate heirs. This most comes up frequently because many will leave property to a spouse or to a trust, and neither are intestate heirs under Arkansas law.
If you own mineral rights, and want to avoid probate in Arkansas, then an Arkansas Beneficiary Deed is a very good option. The deed can automatically transfer your Arkansas mineral rights upon your death, much like a pay on death bank account. Also like a pay on death bank account, the designated beneficiary can be any person, company, or charity.
In my opinion, an Arkansas Mineral Beneficiary Deed is the best option to avoid probate for clients with mineral interests in Arkansas who will have a gross estate that is less than the Federal Estate Tax Exemption. Contact Law Offices of Mark Robinette for more information.
Do you have only a tract of land in Arkansas? If you live in another state and have a vacation home, rental property, timber land, or mineral interest in Arkansas, you may leave your family with a burden if you utilize a will to transfer title at your death.
Merely filing a will in the County real estate records in Arkansas is not enough. The law will require your heirs to admit your will to probate. The average probate costs around $2000.
There is a very low cost alternative to probate. Act 1918 of 2005 allows beneficiary deeds. This makes your Arkansas land or Arkansas mineral interest transfer ownership just like a pay on death bank account. The best part is that it is very flexible and low cost. The beneficiary of your land at your death can be a trust, company, person, or a charity.
Contact Law Offices of Mark Robinette to learn more.
In what Arkansas Counties can you utilize a beneficiary deed? All 72, of course! This includes Arkansas County, Ashley County, Baxter County, Benton County, Boone County, Bradley County, Calhoun County, Carroll County, Chicot County, Clark County, Clay County, Cleburne County, Cleveland County, Columbia County, Conway County, Craighead County, Crawford County, Crittenden County, Cross County, Dallas County, Desha County, Drew County, Faulkner County, Franklin County, Fulton County, Garland County, Grant County, Greene County, Hempstead County, Hot Spring County, Howard County, Independence County, Izard County, Jackson County, Jefferson County, Johnson County, Lafayette County, Lawrence County, Lee County, Lincoln County, Little River County, Logan County, Lonoke County, Madison County, Marion County, Miller County, Mississippi County, Monroe County, Montgomery County, Nevada County, Newton County, Ouachita County, Perry County, Phillips County, Pike County, Poinsett County, Polk County, Pope County, Prairie County, Pulaski County, Randolph County, Saline County, Scott County, Searcy County, Sebastian County, Sevier County, Sharp County, St. Francis County, Stone County, Union County, Van Buren County, Washington County, White County, Woodruff County, Yell County
If the deceased is a resident of Arkansas, the time limit to probate a will is 5 years past the date of death. With non-residents, the time limit is more flexible. Any will admitted to probate in another state in a timely manner may be probated in Arkansas at any time. There are date restrictions. The will of anyone who died prior to the effective date of Act 166 of 1963, whether a resident or non-resident is subject to a strict 5 year statute of limitations. Prior to Act 166 of 1963 and the effective date of Act 140 of 1949, the strict 5 year statute of limitations applied. Prior to Act 140 of 1949, there was no statute of limitations. The courts have contradictory holdings on the retrospective application of Act 140 of 1949. Contact Law Offices of Mark Robinette to discuss if you face this complicated, but rare problem.
If the deceased is a resident of Arkansas, the time limit to probate a will is 5 years past the date of death. With non-residents, the time limit is more flexible. Any will admitted to probate in another state in a timely manner may be probated in Arkansas at any time. There are date restrictions. The will of anyone who died prior to the effective date of Act 166 of 1963, whether a resident or non-resident is subject to a strict 5 year statute of limitations.
Cleburne County landowners Bruce and Jan Smith won on appeal in the case of Smith v. Mountain Pine Timber, Inc., 2016 Ark. App. 193. In this case, Mountain Pine timber previously sold the minerals to land later sold to the Smiths. Mountain Pine then sold the land to the Smiths with full warranty of title and with no mineral reservation.
Under Arkansas law, a warranty of title is actionable as a breach of contract. The statute of limitations does not begin to run until a third party disturbs the purchaser’s rights to possession of the property. This is particularly important feature of the law when it comes to minerals. Minerals are not possessed until produced. Many years can pass before the requisite mineral development and production takes place.
In the Smith case, they purchased the land from Mountain Pine Timber in 1987. It was not until 2008, when the Smiths were approached to sell their mineral rights that the Smiths discovered that Mountain Pine previously sold the Cleburne County mineral rights.
Another point of black letter law in Arkansas is that the damages for breach of warranty of title are “so much of the consideration paid as is proportioned to the value of the land lost, with interest.” Furthermore, the damages cannot exceed the total value of the purchase price. The Court of Appeals therefore reasoned that the property point in time to fix damages was the time of the conveyance. In this case, that was the 1987 conveyance to the Smiths from Mountain Pine. The Smith trial court awarded only $250.22 in damages or $1/acre.
Notably, the only evidence offered on the value of the Cleburne County mineral rights in 1987 was from one of the Defendants who testified that the mineral rights were sold by Mountain Pine for $1 per acre in 1985. This underscores the importance of offering expert testimony of damages. Most likely, the actual value of the Cleburne County mineral rights was much higher than the $1 per acre awarded by the trial court, and the low damages award was the result of insufficient testimony by the Plaintiffs. I’ve seen numerous mineral deeds in the Cleburne County records prior to the Fayetteville Shale discovery that easily exceeded $1 per acre.
Justice, however, was in some manner served for the loss suffered by the Smiths. In a companion appeal of Mountain Pine Timber v. Smith, 2016 Ark. App. 197, the Court of Appeals upheld an award of attorney’s fees in the same case. Arkansas law allows attorney’s fees to the prevailing party in a contract action (which a deed covenant is) provided the fees are reasonable. The court awarded $17,500 in attorney’s fees. The Appeals Court concluded the award of attorney’s fees was not excessive.
The story: A tenant renting an office did not have enough sense to move out quietly in the dead of night or over a long weekend after not paying the rent for months. The tenant held out intransigently because it had either nowhere else to go or nowhere else to put its stuff. The court gave an order with a writ of possession. The sheriff accompanied the landlord to the property, the tenant wasn’t there, and the locksmith changed the locks. To the landlord’s surprise, the office is full of furniture, decor, and books. The tenant owes $3,000 in back rent and $1,000 in court costs and attorney’s fees. What should the landlord do with this bonanza of business property?
Under Ark. Code Ann. 18-16-108, “[u]pon the voluntary or involuntary termination of any lease agreement, all property left in and about the premises by the lessee shall be considered abandoned and may be disposed of by the lessor as the lessor shall see fit without recourse by the lessee.” This statute was upheld in Omni Holding and Development Court v. C.A.G. Investments, Inc., 370 Ark. 220, 258 S.W.3d 374 (2007). In this case, the court ruled that upon the issuance of the writ of possession, the property became abandoned. This means that the tenant has only until the judgment (or if an appeal is taken any time during the staying of the judgment) to remove property on the premises. After that, it’s too late.
The hypothetical landlord sells the office furniture, book, and decor to a new tenant for $1500. If our hypothetical tenant owes a $4,000 judgment, then what, if any, affect does the landlord’s sale have on the judgment???
Tough question. Part b of 18-16-108 states that “[a]ll property placed on the premises by the tenant or lessee is subject to a lien in favor of the lessor for the payment of all sums agreed to be paid by the lessee” Did the General Assembly intend that part a of the statute (abandonment) work in concert with part b (lien)? I could argue either way. My argument that the landlord has no duty to utilize the proceeds of the sale is that part a uses “abandoned” as the property’s status and the landlord can dispose of the property “without recourse.” The legal term of art “abandoned” at common law means that one finding property becomes the owner. Thus, by using this term of art, the General Assembly meant that the Landlord is literally the owner of the property. The “without recourse” provision redoubles this interpretation.
On the other hand, I can argue part b should read with part a because there is nothing in the remainder of the Arkansas Code that tells the would be lien holder landlord how to foreclose upon the lien created. I suppose that the argument is that part a and part b together create a type of bailor-bailee relationship. This would allow the landlord to make a commercially reasonable sale.
The stronger argument is the first. To impute a bailor-bailee relationship such as a pledge is to impute the commercially reasonable sale requirement. How can the requirement for a commercially reasonable sale exist when the statute specifies that the disposal of the property is “without recourse?” A court could get there, but the legal gymnastics to get there, while possible, are yoga-like in stretch and posture.
I think this question is an academic one that may never be answered by the courts. Practically, no person with any common sense will leave anything valuable on the premises. They might leave a liability (like some junk), but nothing that will bear fruit for the repossessing landlord. In the rare cases they do, the value of the property pales in comparison to the judgment for back rent and the landlord doesn’t want to spend money to collect the judgment, so any serious consideration of whether to credit the judgment never occurs. The landlord just takes or sells the property and leaves the judgment standing until it dies 10 years hence.
Thanks for reading. Don’t take anything above as legal advice. Every situation is different and there subtleties that I didn’t address, so what you’ve read is very, very general and generic and may not apply to your situation. If you have the need for representation, give me a call at 501-251-1076. I accept landlord tenant cases including evictions in the Central Arkansas area including, Pulaski County, Lonoke County, Saline County, Faulkner County, and Perry County. This includes the Little Rock, North Little Rock, Bryant, Benton, Conway, Mayflower, Perryville, Lonoke, Sherwood, Jacksonville, and Cabot metropolitan areas. In general, I don’t represent tenants that are individuals unless there’s a serious problem with the premises or the landlord’s behavior. With businesses tenants, I will take tenant work on a case by case basis. Landlords are almost always welcome. Call me at 501-251-1076.
In Shepard v. Jones, 2015 Ark. App. 279, a Pulaski County, Arkansas man’s will was found invalid after a lengthy and factually intensive trial. In this case, the man was in hospice, on pain and anti-anxiety drugs, and barely conscious when his friend literally signed the will for him by holding the pen in the dying man’s hand and signing the man’s name. In addition, the person procuring the will who was the man’s half-sister, withheld the fact that the dying man then owned $114,000 from the death of his sister. The half-sister directed that the will she had prepared for her dying half-brother leave her and a family friend $365,000 while leaving the other heirs at law sums of $15,000 or less.
The facts of this case are excellent reading and law case book example of lack of capacity and undue influence. In Arkansas, one seeking to dispose of his property by will must be able to retain in his mind, without prompting, the extent and condition of his property, to comprehend to whom he is giving it, and relations of those entitled to his property. In this case, the man had no capacity whatsoever as evidenced by the trial court record. The court’s recitation of the facts and circumstances leading up to the signing of the will is on pages 2 through 9 of the opinion.
If you have questions about the circumstances of the making of a loved one’s will, Arkansas probate and wills attorney Mark Robinette can provide you with valuable information about the law. Lawyer Mark Robinette accepts probate cases in all 72 Arkansas counties. Whether you need a full probate and administration of an estate or just probate of a will to clear title, Arkansas probate lawyer Mark Robinette can help you.