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79-329. Oil and gas property as personalty. For the purpose of valuation and taxation, all oil and gas leases and all oil and gas wells, producing or capable of producing oil or gas in paying quantities, together with all casing, tubing or other material therein, and all other equipment and material used in operating the oil or gas wells are hereby declared to be personal property and shall be assessed and taxed as such.

History: L. 1917, ch. 323, ยง 1; March 13; R.S. 1923, 79-329.

Cross References to Related Sections:

Oil and gas, see chapter 55.

Law Review and Bar Journal References:

Conveyancing questions discussed, H. H. Lesar, 8 J.B.A.K. 241, 242 (1939).

Distinctions between royalties and mineral deeds, Herbert Diets, 16 J.B.A.K. 28 (1947).

Mines and minerals and the nature of mining leases and agreements, 1 K.L.R. 364, 367 (1953).

1953-55 survey of oil and gas law, Bernard E. Nordling, 4 K.L.R. 162, 169, 170 (1955).

Case in annotation No. 6 below discussed in 1959-61 survey of taxation law, Leslie T. Tupy, 10 K.L.R. 305, 306 (1961).

Attorney General's Opinions:

Mortgage registration fee due when security interest is created in oil and gas leasehold. 80-155.

Oil and gas property as personalty; property held by federal land bank exempt from taxation. 86-16.

Taxation on property transferred to federal land bank before payment of taxes; collection. 87-135.

CASE ANNOTATIONS

1. Overriding royalties are taxable to owners. Robinson v. Jones, 119 Kan. 609, 240 P. 957.

2. Fractional interest of minerals conveyed by mineral deed not taxable as personalty. Shaffer v. Kansas Farmers' Union Royalty Co., 146 Kan. 84, 87, 89, 69 P.2d 4.

3. Mineral deed considered and mineral rights held taxable hereunder. (Dissenting opinion.) Hushaw v. Kansas Farmers' Union Royalty Co., 149 Kan. 64, 68, 75, 86 P.2d 559.

4. Royalty interest taxable hereunder; instrument construed to convey royalty interest. Hickey v. Dirks, 156 Kan. 326, 328, 133 P.2d 107.

5. Section is not part of inheritance tax law. Denver National Bank v. Commission of Revenue and Taxation, 176 Kan. 617, 272 P.2d 1070. Affirmed: 177 Kan. 274, 280, 279 P.2d 257.

6. Under facts oil and gas interest of Federal Land Bank taxable; immunity. Federal Land Bank v. Board of County Commissioners, 187 Kan. 148, 150, 155, 354 P.2d 679. Reversed: 368 U.S. 146, 82 S. Ct. 282, 283, 284, 7 L.Ed.2d 199.

7. Cited; oil and gas leaseholds assessed as personal property. Mobil Oil Corporation v. McHenry, 200 Kan. 211, 224, 436 P.2d 982.

8. Assessment and valuation of property are administrative in character; absent evidence that assessment was arrived at fraudulently, arbitrarily or capriciously, a difference of opinion as to value doesn't warrant judicial interference. Cities Service Oil Co. v. Murphy, 202 Kan. 282, 293, 447 P.2d 791.

9. Assessment of oil and gas property essentially a self assessment system; penalty upheld. Walkemeyer v. Stevens County Oil & Gas Co., 205 Kan. 486, 489, 470 P.2d 730.

10. Mentioned; assignment of oil and gas lease not subject to provisions of uniform commercial code. Ingram v. Ingram, 214 Kan. 415, 419, 521 P.2d 254.

11. Considered in denying petition of attorney general for writ of quo warranto to prevent utilization of K.S.A. 79-331 and challenging constitutionality thereof. State ex rel. Stephan v. Martin, 230 Kan. 747, 754, 641 P.2d 1011 (1982).

12. Considered in holding K.S.A. 79-343, relating to assessment of farm machinery and equipment, unconstitutional and void; quo warranto granted. State ex rel. Stephan v. Martin, 230 Kan. 759, 777, 641 P.2d 1020 (1982).

13. Oil lease experiencing production decline late in year previous to assessment properly valued by consideration of post-January production data. Board of Ness County Commr's v. Bankoff Oil Co., 265 Kan. 525, 528, 538, 960 P.2d 1279 (1998).


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