May 21

Effective October 1, 2014, HB 489 was signed into law as a result of the legislature’s need to more closely regulate the disclosure of retained mineral interests.

The law created Sec. 689.29, F.S.  which requires the seller to give written notice to the prospective buyer at or before the execution of a contract for sale if the seller (or an affiliated or related entity of the seller) has previously severed or retained, or will sever or retain, any of the subsurface rights or right of entry on the property being sold.  The notice may be provided in the sales contract itself or may be provided in a separate notice incorporated by reference into the sales contract.  The form of disclosure notice is set forth in the law.   The notice must be conspicuous, in boldface type, and in substantially the following form:

“SUBSURFACE RIGHTS HAVE BEEN OR WILL BE SEVERED FROM THE TITLE TO  REAL PROPERTY BY CONVEYANCE  (DEED) OF THE SUBSURFACE  RIGHTS FROM THE SELLER OR AN AFFILIATED OR    RELATED ENTITY OR BY RESERVATION OF THE SUBSURFACE  RIGHTS BY THE SELLER OR AN AFFILIATED OR RELATED ENTITY.  WHEN SUBSURFACE  RIGHTS ARE SEVERED FROM THE PROPERTY, THE OWNER OF THOSE RIGHTS MAY HAVE  THE PERPETUAL RIGHT TO DRILL, MINE, EXPLORE, OR REMOVE ANY OF THE SUBSURFACE  RESOURCES ON OR FROM THE PROPERTY EITHER DIRECTLY  FROM THE SURFACE  OF THE PROPERTY OR FROM A NEARBY LOCATION.  SUBSURFACE  RIGHTS MAY  HAVE A MONETARY  VALUE.”

This law only applies to real estate zoned for residential use (including other zoning categories, such as Agriculture, where residences are permitted) AND on which a new dwelling is: (a) being constructed; or (b) will be constructed pursuant to the contract for sale with the seller; or (c) has been constructed since the last transfer of the property.

The law is very broad in defining “Subsurface rights” to include “all minerals, mineral fuels, and other resources.”