RS 204 - Mortgage may include pledge; effect of pledge
A. A mortgage of mineral rights entered into prior to the time Chapter 9 of the Louisiana Commercial Laws becomes effective may also provide for the pledge of minerals subsequently produced to the extent of the mortgagor's interest therein or of the proceeds accruing from the sale or other disposition thereof. Delivery of the minerals or proceeds is unnecessary and, upon execution of such an act of mortgage containing the pledge, the pledgee is possessed of them and is entitled to receive all amounts accruing to them. Such a pledge entered into prior to the time Chapter 9 of the Louisiana Commercial Laws becomes effective is effective as to third persons when the act of mortgage containing the pledge is properly filed for registry. A person who pays, delivers, or accounts to a pledgor, under a contract or agreement in existence at the time the act of mortgage is filed for registry, for minerals produced, or proceeds from the sale thereof, or royalties, rentals, or other sums which the pledgee is entitled to receive under the pledge, may make the payments or deliver or account for such minerals to the pledgor without liability to the pledgee until such person has been delivered a certified copy of the act of pledge or until he has acknowledged in writing to the pledgee notice of the pledge. The privilege enjoyed by the pledgee shall attach to all minerals severed or the proceeds thereof in the hands of the pledgor as long as they can be identified. The pledgor shall promptly account to the pledgee for them unless excused from doing so by the act of pledge. The pledge stipulated in the act of mortgage of mineral rights is extinguished when the mortgage is extinguished.
B. Pledges of minerals produced or the proceeds from the sale or other disposition thereof entered into after Chapter 9 of the Louisiana Commercial Laws (R.S. 10:9-101, et seq.) becomes effective are effective between the parties and as to third parties as provided in Chapter 9.
Acts 1974, No. 50, §204, eff. Jan. 1, 1975; Acts 1989, No. 137, §10, eff. Sept. 1, 1989.
{{NOTE: SEE ACTS 1989, NO. 137, §§20 AND 21.}}