Virginia Law

Article 2. Trusts for Coal Interests.

A. Any coal owner or lessee who (i) has more than a 50 percent interest in the coal on a particular tract and (ii) seeks to impress a trust upon unknown or missing owners of such tract of coal may petition the circuit court in the county or city containing the majority of the tract of coal to establish a trust to protect the interests of all coal owners and lessees.

B. The petition shall:

1. Describe the particular tract of coal at issue;

2. List all known, missing, and unknown owners of interests in such tract of coal and set forth the efforts to locate and identify the missing or unknown owners of the interests and provide any other information known to the petitioner that could be helpful in identifying or locating every present owner thereof; and

3. Include the proposed terms of a lease to be offered to the trust. Such lease shall be typical of other arm's-length leases in the area.

C. The petitioner shall establish to the satisfaction of the court that a diligent effort has been made to identify and locate the present owners of such interests.

2003, c. 775, § 45.1-161.311:3; 2021, Sp. Sess. I, c. 387.

Immediately upon filing the petition pursuant to § 45.2-602, the petitioner shall advertise a notice of the pending action, including a statement that the action is brought for the purpose of impressing a trust authorizing the execution of a valid and present coal lease for the development of a tract of coal described in the petition pursuant to the provisions of subsection B of § 45.2-602. Such notice shall appear in a local newspaper of general circulation at least once a week for two consecutive weeks.

2003, c. 775, § 45.1-161.311:4; 2021, Sp. Sess. I, c. 387.

A. If, upon presentation of a petition pursuant to § 45.2-602 to the circuit court in the county or city containing the majority of the tract of coal, it appears to the court that development of the interests in such tract of coal will be advantageous to the unknown or missing owners, the court shall declare a trust in the coal interests and appoint a trustee for such interests. The court shall authorize the trustee to execute a lease covering the coal interests in the identified tract of coal. The order of the court shall provide for all the terms and provisions of the lease that the trustee is authorized to make.

B. The trustee shall proceed in compliance with the provisions of the order to execute the lease and after executing the lease shall submit a report thereof to the court.

C. The court shall not authorize a trustee's lease upon the coal interests of any owner whose identity and location are known, can be ascertained, or are discovered as a result of the action brought under this article. Any such owner may intervene as a matter of right at any time prior to the judgment approving the trustee's lease for the purpose of establishing his title to the coal interests. If such coal owner's claim is established to the satisfaction of the court, the court shall dismiss the action at the plaintiff's cost.

2003, c. 775, § 45.1-161.311:5; 2021, Sp. Sess. I, c. 387.

A. The trustee shall collect the proceeds from the sale of the lease and hold and invest such proceeds for the use and benefit of the unknown or missing owners. The court may authorize the trustee to expend an amount not to exceed 10 percent of the funds collected by the trustee for the purpose of searching for the unknown or missing owners.

B. Five years after the date of first commercial production of the coal interests, the proceeds in the trust shall be disposed of pursuant to the Virginia Disposition of Unclaimed Property Act (§ 55.1-2500 et seq.).

2003, c. 775, § 45.1-161.311:6; 2021, Sp. Sess. I, c. 387.

All attorney fees, expenses, and court costs incident to the original proceedings shall be paid by the lessee if a lease is executed and by the plaintiff if for any reason no lease is executed. Subsequent to entry of judgment, all allowable attorney fees, expenses, and court costs shall be paid out of funds controlled by the trustee.

2003, c. 775, § 45.1-161.311:7; 2021, Sp. Sess. I, c. 387.

A. Any coal owner or lessee who (i) has at least a two-thirds interest in the coal on a particular tract of land and (ii) seeks to extract such coal may petition the circuit court in the county or city containing the majority of the tract of coal to establish a trust for known coal owners and lessees.

B. The petition shall:

1. Describe the particular tract of coal at issue;

2. List all known owners of interests in the tract of coal; and

3. Include the proposed terms of a lease to be offered to each minority owner. Such lease shall be typical of other arm's-length leases in the area.

C. The petitioner shall establish to the satisfaction of the court that a diligent effort has been made to obtain the consent of each minority owner to lease his interest in the coal. The petitioner shall demonstrate to the court that (i) the production of the coal by the petitioner's lessee is of economic benefit to all parties; (ii) if the coal is not produced, the economic value of the coal is lost and the economic benefit of owning the coal is decreased; and (iii) there is no practical method for dividing such coal among the owners without extracting the coal.

D. Immediately upon filing the petition, the petitioner shall send by registered or certified mail, with a return receipt requested, notice of the petition to the party subject to the petition.

E. The court may appoint a trustee and authorize the trustee to execute a lease pursuant to § 45.2-604.

F. The court shall escrow or direct the trustee to escrow the proceeds of the lease attributable to each of the minority interests until such minority owner's claim is established to the satisfaction of the court.

2003, c. 775, § 45.1-161.311:8; 2021, Sp. Sess. I, c. 387.