M&P BEING SUED / CLASS-ACTION SUIT AGAINST HALCON, M&P & CX

 

Hello everyone:

                         I have not posted anything on here before. I have always just read the comments of others. I thought I would just post some thoughts. After being patient for 8 1/2 months I still have no answers like others in the south east Mercer County area. Is Halcon going to be held responsible for their actions? Are they going to be made to pay for the contracts they signed for? How qualified is M&P when it comes to representing the landowners of group 4 against a company like Halcon with deep pockets. Will we get an honest effort from M&P or will they make it as short as possible and except less than what we deserve to mitigate damages on their behalf. I have just read, in detail, the civil suit against M&P by Terra Energy LLC. Now it seems to me that the landowners not only have to worry about being pushed around by an unethical oil & gas Co, but now we have to worry about the real motives of the law firm we have to represent us. Are they going to treat clients like they treated business partners? I think if given a chance M&P will come back to the land owners after any legal actions against Halcon with a bogus report how they couldn't do much and if we continue it will tie up our lands for years, of course due to a half hearted attempt at getting us what we legally are owed.

                        I only have this attitude after listening to M&P for 8 1/2 months tell us how important it is to stick together as a group but they will break up the group at the drop of a hat to sign a little chunk to this O&G Co and another chunk to a different O&G Co. This sticking together only benefitted them by having all of us available to them for whatever size of lease they could get from any other O&G Co. After seeing an E-Mail to Terra Energy Advisors LLC from Jack Polochak describing how maybe Terra Energy should  get some leases signed by an O&G Co that are less than desirable for landowners to make it look like A Co he was partnering up with was successful in the oil and gas leasing business. That just shows me that he will sacrifice his clients profits to improve his and his associates. I think everyone should read the Lawsuit especially the landowners of group 4. Maybe I am seeing this in a sinister way and I am just swayed by how the rest of the world does things these days. Here is the link to the Lawsuit. I would like to know how many other landowners see it the way I do.

MPLawsuit.pdf

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Permalink Reply by Samuel J. Orr on February 12, 2013 at 2:36am

Shale Advice: You have said I think what I have been trying to say. I can understand " such other due diligence as the company may in its sole discretion require" as including things like discovering some environmental regulation that would prevent drilling. I originally never the thought that it could mean "the company can refuse to fund the lease at any time during the due diligence period for any reason or no reason!" Nor did I think that the company could use the excuse that a parcel was too small or that the geology was less than ideal.  Yet a number of people, some of whom are lawyers, have expressed the view that the due diligence language means exactly that and that O&G companies have used the same or similar language to walk away from "leases" which they interpret as being lease options during the due diligence period. I have said multiple times that Halcon's interpretation seems to make the documents' promises to the signing landowners illusory and unsupported by consideration. I have expressed the view that if Halcon's interpretation is some industry-wide standard, then M&P as presumptively competent lawyers had a duty to explain this to their clients, and  perhaps discourage them from signing such documents. I am further troubled that Halcon continues to selectively decline to fund leases on certain parcels even after the so-called due diligence period has expired. Finally, I reiterate my believe that M&P should publish on the website the text of its agreement with Halcon. I am unconvinced that the "proprietary document" excuse is valid. Alternatively it could furnish a copy of said agreement to the aggrieved landowners. In the meantime the M&P / CX juggernaut rolls on merchandising their supposed expertise in helping landowners obtain favorable leases. Despite all this, I hope M&P's magic document is successful in helping all of said aggrieved landowners to get paid.

Permalink Reply by Kevin Senich on February 12, 2013 at 6:55am

Jay: 

Are you saying the mere promise on the part of the optionee to do "due diligence" is adequate consideration to bind the optioner?  I would disagree, and I don't mind putting my name behind that opinion.  The essence of consideration lies in its quality as an inducement to enter into a contract.  No landowner is induced to enter into a lease or an option to lease by virtue of a lessee's or optionee's promise to do due diligence.  Unless perhaps an optioner was going to receive a title opinion as a function of the due diligence, i.e., something of value to the optionee, the promise to do due diligence would not bind the optioner.  Certainly mutual promises can be adequate consideration for a binding agreement.  But, they have to be mutally beneficial or valuable.  A dictionary definition of "consideration" is "an act or forbearance, or the promise thereof, which is offered by one party to an agreement, and accepted the other as an inducement to that other's act or promise."  Blackstone defined it most concisely as "the reason which moves a contracting party to enter into a contract".  

Do you really believe landowners are moved to lease their rights by an offer to do "due diligence"? 

 

 

Permalink Reply by Schnoozie on February 12, 2013 at 5:29am

Agreed Fang,

I was screaming about this outcome from the beginning of this after listening to the long winded BS presentation, then to the advice of our Atty. and to the three Company Landmen who came to talk to us. None of them lied, or steered us down a questionable path.

This lawsuit is nothing more than sour grapes between two groups of people who were and are in way over their head. There is a price to pay here, My opinion it falls at the feet of M&P/CX, they drove the bus.

You sell real estate one day, then next you are in the Gas Land/Business.

You are barely out of law school, next day you are Organizing mass land signings with questionable staff and intentions.

I have just informed our staff that tomorrow, each employee is to quit doing CNC work and become a Dentist.

Seems anyone can do it.

 

 

 

Permalink Reply by Kevin Senich on February 12, 2013 at 6:56am

Fang F. Fang:

Can you give me a cite on that case law?  I would be interested in reading it.  Thanks.

Permalink Reply by ralph monico on February 12, 2013 at 6:13am

Understood, and that's certainly one avenue to attack the "due diligence" language.  The reality is, however, in the absence of a legal challenge gas/oil companies will interpret the clause in the manner that benefits their own interests. 

I'd attempt to strike or qualify that language from any lease being considerted by a family member or client.  If the company refused a request to remove or modify the language, I would make sure all understood the significance of the clause as well as its possible application. 

Permalink Reply by Samuel J. Orr on February 12, 2013 at 6:30am

Assuredly the due diligence language could be modified so as to say something like  the following: "due diligence" as defined in this agreement includes any or all of the following......with an enumerated and exclusive listing of what the term includes for purposes of the particular agreement. It should not allow an O&G company to escape paying bonus money for any reason or no reason whatsoever. I maintain that M&P who advertise themselves as great experts in procuring landowner friendly leases ought to have seen this problem. If not, what have they done to specifically prevent this unfortunate debacle from occurring in the future. The M&P / CX behemoth rolls on continuing to sign up landowners in various counties. It is a great money machine benefitting primarily M&P / CX. Have they no shame whatsoever?

Permalink Reply by Daniel Rupert on February 12, 2013 at 6:54am

NO...IT IS WHAT IT IS!

IT IS ASHAME ...THAT THEY HAVE NO SHAME

Permalink Reply by p umpjack on February 12, 2013 at 7:12am

the only thing anyone saw in this deal was $$$

its like bundling mortgages its how many can we get not how many will fall out

any lease from a o-g company has a veiled option clause in it has been always will be

you want a level playing field stick to billiards

Permalink Reply by Daniel Rupert on February 12, 2013 at 7:19am

$$$ IS CORRECT SIR!!!

SAME THING IN MY PERSONAL MESS...

WISH ALL THE BEST TO THOSE AFFECTED...

2z248p19vqnh9Permalink Reply by 2z248p19vqnh9 on March 21, 2014 at 4:17am

ralph monico - were YOU approached to possibly help handle this matter for individuals (GROUP of individuals)? You seem concerned & knowledgable...

As one light lights another, nor grows less - so nobleness enkindles nobleness.

Samuel J. Orr...*'due diligence' language should not in ANY way EVER become

                     ...*'due deceipt' language - by ANY means.

Agreed?

Permalink Reply by Samuel J. Orr on February 12, 2013 at 7:44am

I was not suggesting that the "due diligence" language could be modified in any currently existing "lease" or "lease option". What I was saying is that no landowner should in the future sign a document containing due diligence language unless the term "due diligence" was clearly defined to include a specific number of things and by exclusion no others. That the language in the Mount Jackson 4 documents is problematic is revealed by a number of different opinions by lawyers as to what it means. I am suggesting that it be defined so that no O&G Company can decline to pay bonus money based upon a mere whim, or for any reason or no reason whatsoever. I have posed the open question as to what actions M&P is taking or will take to prevent a repeat of Mount Jackson 4.

Permalink Reply by p umpjack on February 12, 2013 at 9:11am

good luck with that

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