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2014 SESSION
14101741DBe it enacted by the General Assembly of Virginia:
1. That § 45.1-361.22:1 of the Code of Virginia is amended and reenacted as follows:
§ 45.1-361.22:1. Conflicting claims of ownership; arbitration.
A. The Board shall enter an order requiring that the matter of
disputed ownership be submitted to arbitration, and notify the circuit court in
the jurisdiction wherein the majority of the subject tract is located, (i) upon
written request from all claimants any claimant to the ownership
of coalbed methane gas related to the subject tract under § 45.1-361.22; (ii)
upon receipt of an affidavit executed by all such claimants a claimant affirming that
there is no other
known surface owner, gas or oil owner, coal owner, mineral owner, or operator
of a gas storage field certificated by the State Corporation Commission having
an interest underlying the subject tract other than those
listed in the affidavit; (iii) after a hearing noticed
pursuant to subsection B of § 45.1-361.19; and (iv) upon a determination by the
Department whether sufficient funds are available to pay the estimated costs of
the arbitration pursuant to subsection F. Within 30 days of receipt of the
notice from the Board, the circuit court shall appoint an attorney from the
list maintained by the Department pursuant to subsection C or, at the discretion
of the court, such other attorney meeting the qualifications set forth in
subsection C. Prior to his appointment as an arbitrator of a particular
dispute, the attorney shall certify to the circuit court that he has not
derived more than 10 percent of his income during any of the preceding three
years from any claimants asserting ownership or rights in the subject tract or
any affiliated entities or immediate family members of such claimants. If the
attorney cannot provide such certification, he shall notify the circuit court
and he will be disqualified from serving as arbitrator for that particular
dispute.
B. The Department shall send notice to all claimants if it determines that there are insufficient funds to pay the estimated costs of the arbitration pursuant to subsection F. The claimants may, by unanimous agreement, proceed with the arbitration process, notify the Board of such agreement, and bear the costs to the extent of the insufficiency. If the parties do not agree, the arbitration shall be delayed until such funds are available.
C. To be qualified as an arbitrator, a candidate (i) shall be an attorney licensed in the Commonwealth a retired circuit court judge;
(ii) shall have at least 10 years of experience in real estate law, including
substantial expertise in mineral title examination; and
(iii) shall disclose to the Board whether he has been engaged within the
preceding three years by any person in matters subject to the jurisdiction of
the Board or the Department under this chapter. The Department shall solicit
applications from attorneys meeting the qualifications set forth above and
maintain a list of attorneys qualifying as arbitrators for use by the circuit
courts. At least once annually, the Department shall update its list. To
maintain qualification, each attorney whose name appears on the list shall
update annually his disclosures set forth in clause (iii).
D. The arbitrator shall determine a time and place for the arbitration hearing and cause written notification of such hearing to be served on each surface owner, gas or oil owner, coal owner, mineral owner, or operator of a gas storage field certificated by the State Corporation Commission having an interest underlying the tract that is the subject of the hearing. Parties shall be served personally or by certified mail, return receipt requested, not less than 14 days before the hearing. Appearance at the hearing waives such party's right to challenge notice. Any party to the arbitration has the right to representation before the arbitrator pursuant to § 8.01-581.05. In accordance with § 8.01-581.06, the arbitrator may issue subpoenas for the attendance of witnesses and for the production of books, records, documents, and other evidence; administer oaths; and, upon application by a party to the arbitration, permit the taking of depositions for use as evidence. The arbitrator shall hear and determine the controversy upon the evidence and consistent with applicable law, notwithstanding the failure of a party to appear at the hearing.
E. The arbitrator shall issue his determination as to the ownership in the coalbed methane gas and entitlement to proceeds held in escrow within six months from the order of the Board requiring the matter be submitted to arbitration, unless a longer period is otherwise agreed to by all parties. Such determination shall be in writing and sent to the Board and each party to whom notice is required to be given under subsection D.
F. Upon the issuance of the arbitrator's determination of ownership and subject to the availability of funds, the fees and expenses of the arbitration, but not including fees or costs of counsel engaged by the respective claimants or any other costs of the claimants, shall be paid from the accrued interest on general escrow account funds.
G. An arbitrator's determination, rendered pursuant to
subsection E, shall be binding upon the parties
and, upon request of any party to the arbitration, may be entered as the
judgment of the circuit court responsible for appointing the arbitrator under subsection
A.
H. Upon application of any party to the arbitration, a
determination rendered pursuant to subsection E may be
confirmed, vacated, corrected, or appealed pursuant to the grounds set forth in Chapter 21 (§
8.01-577 et seq.) of Title 8.01 to
the circuit court responsible for appointing the arbitrator under subsection A.
The circuit court shall
have the discretion to award attorney fees as circumstances may require.