Anything in this chapter to the contrary notwithstanding, any lien claimed by virtue of this chapter, insofar as it may extend to oil or gas or the proceeds of the sale of oil or gas, shall not be effective against any purchaser of such oil or gas until written notice of such claim has been delivered to such purchaser. Such notice shall state the name of the claimant, his address, the amount for which the lien is claimed, and a description of the leasehold upon which the lien is claimed. Such notice shall be delivered personally to the purchaser or by registered letter or certified mail. Upon receipt of such notice the purchaser shall withhold payments for such oil or gas runs to the extent of the lien amount claimed until delivery of notice in writing that the claim has been paid. The funds so withheld by the purchaser shall be used in payment of the lien judgment upon foreclosure. The lien claimant shall within 10 days give notice in writing that the claim has been paid.
§ 1203.59.Notice of Lien
Title 4. Of the Enforcement of Liens · Chapter 2.5. Oil and Gas Liens · Enacted 1959 · no amendments on record · Last verified July 29, 2026
In one sentenceSection 1203.59 makes an oil and gas lien ineffective against a purchaser of the oil or gas until the claimant delivers written notice of the claim, after which the purchaser must withhold payments equal to the claimed amount and the claimant must give notice within 10 days once paid.
Full Text of § 1203.59
Plain-English Summary
A lien on oil or gas, or on the proceeds of selling it, works differently than a lien on physical equipment — the product keeps moving through purchasers. This section protects those purchasers by requiring the lien claimant to give them actual notice before the lien can bind them.
The notice has to state the claimant's name and address, the amount claimed, and a description of the leasehold, and it has to be delivered personally or sent by registered letter or certified mail. Once a purchaser receives that notice, the purchaser must withhold payment for the oil or gas runs, up to the lien amount claimed, until receiving written notice that the claim has been paid.
The money withheld isn't just sitting idle — it's earmarked to satisfy the lien judgment if the claimant forecloses. And once the debt is paid, the claimant has ten days to notify the purchaser in writing so the withholding can stop.
Frequently Asked Questions
Is a lien automatically effective against someone who buys the oil or gas?
No. Section 1203.59 requires the claimant to deliver written notice of the lien to the purchaser before it becomes effective against that purchaser.
How must that notice be delivered?
Personally, or by registered letter or certified mail, stating the claimant's name and address, the amount claimed, and a description of the leasehold.
What must the purchaser do after receiving the notice?
Withhold payment for the oil or gas runs, up to the amount claimed, until receiving written notice that the claim has been paid.
What happens once the lien claim is paid?
The claimant must give the purchaser written notice of payment within 10 days, and the withheld funds are used toward any lien judgment obtained on foreclosure.
Amendment History
Added by Stats. 1959, Ch. 2020.
Source & verification. Section text is reproduced verbatim from
the Deering's California Codes Annotated / vLex. Enacted by the California Legislature.
Last verified July 29, 2026.
· Official source
Also known as: oil and gas lien notice to purchaser californiawithholding payment oil and gas lien