Landowners claim mineral rights sold illegally - Beckley, Bluefield & Lewisburg News, Weather, Sports

Landowners claim mineral rights sold illegally

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An 84-year-old Marshall County resident and his son claim a former deputy prosecutor overseeing delinquent properties for the state auditor’s office engineered the sale of the mineral rights to nearly 1,500 acres of their land to a company he represented without notifying them their property was even at risk.

Harry W. Moore and his son, Harry Moore Jr., allege Robert W. Kagler never told them he’d put their property on the delinquent tax list or that the mineral rights had been sold to the Hayhurst Company or one of its sister operations, Chestnut Holdings and Tri-County Oil & Gas. All are owned and operated by Ronald Hayhurst.

Their suit, filed in U.S. District Court in Clarksburg, alleges the Hayhurst companies were able to acquire mineral rights to some 1,500 acres of their property for less than a penny an acre. The Moores claimed Kagler, then an assistant prosecutor, identified properties of interest for Hayhurst at the same time he was serving as deputy commissioner for Marshall County’s Office of Delinquent and Non-Entered Lands.

The suit alleges that in February 2003 Kagler designated a parcel the Moores owned as delinquent and then sold the mineral rights to Tri-County without ever advertising it as a delinquent account in the Moundsville Daily Echo.

The Moores say they were unaware of the assessment and only found out the mineral rights had been sold after the fact, though they were able to redeem the mineral rights to that particular property for $2,000 because notice of the sale was printed in the local paper before the redemption period expired. But they allege in their suit they were never notified that the mineral rights to hundreds of additional acres belonging to them to had been designated delinquent and sold. Because they weren’t aware of the delinquency or the sale, they say those mineral rights were not redeemed.

They also allege Kagler instructed county employees to exonerate Hayhurst’s past-due taxes and said he attempted to have the names of the actual owners of properties sold at auction replaced with the Hayhurst Company’s contact information prior to the expiration of the redemption period so that notice of all sales would be sent to the company, not the actual property owners.

Kagler was dismissed from his county post in 2003 when his law license was suspended after money from an estate for which he had been acting as fiduciary came up missing, the Moores said.

The Lawyer Disciplinary Board confirmed Kagler’s license had been suspended in 2003 because of missing estate funds. A condition to his reinstatement was that he make restitution of $82,500 plus interest.

The sales of the Moore family’s mineral rights, however, proceeded under the supervision of the West Virginia State Auditor’s Office G. Russell Rollyson based on the information Kagler had prepared before he was discharged and without their knowledge, the suit charged.

“If the property interests were even given sufficient time after assessment to become delinquent, notice of delinquency was not provided to ... the true owners,” they state in the suit.

In all, the Moores say the Hayhurst companies paid less than $27 for mineral rights to property they say would bring in between $4.3 million and $7.2 million in today’s market.

They are seeking $16 million in damages plus costs from Kagler, the Marshall County Commission; Hayhurst Co. and Chestnut Holding and their owner, Ronald Hayhurst, as well as the State of West Virginia, claiming they weren’t notified of the sale of their mineral rights and that they were victims of mail fraud, wire fraud, conspiracy and racketeering.

It also alleges the state was negligent in its oversight of Kagler.

The Moore family’s attorney, Jenny Bonham of Hinton, did not return repeated calls for a comment.

Kagler referred questions to Rollyson in the state auditor’s office. Rollyson, however, said he couldn’t discuss the allegations.

“All I can say is it’s under review by our office right now, through the legal channels,” Rollyson said. “We’ll be responding in an appropriate manner.”