Open AccessLet's Talk About Royalties: The Continued Uncertainty Surrounding the Creation and Legal Status of the Overriding Royalty
Author(s) -
David LeGeyt,
Ashley Weldon,
Natasha Wood,
Brendan Downey
Publication year - 2019
Publication title -
alberta law review
Language(s) - English
Resource type - Journals
eISSN - 1925-8356
pISSN - 0002-4821
DOI - 10.29173/alr2578
Subject(s) - corporation , supreme court , property law , law , energy law , property (philosophy) , capital (architecture) , law and economics , economics , business , property rights , political science , environmental law , philosophy , archaeology , epistemology , history
The oil and gas and mining industries developed the practice of creating royalties that would run with the land. This led to the Supreme Court of Canada’s decision in Bank of Montreal v. Dynex Petroleum Ltd. Despite the decision in Dynex recognizing a new property right and changing the common law, the law remained unsettled until the Third Eye Capital Corporation v. Ressources Dianor Inc./Dianor Resources Inc. and Manitok Energy Inc (Re) decisions apparently simplified the concept of royalties as property interests. In this article, the authors explore the overriding royalty, its common law evolution, the uncertainties surrounding its proper legal characterization, the implications of such legal uncertainty, and the shift the Dianor and Manitok decisions represent, while considering the nature of the interests that royalties represent, the manner in which industry has attempted to protect those interests, and the efficacy of such attempts.