Monthly Archives: August 2004

Dirty Secrets About Legal Fees

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Don’t get me started about legal fees. Not because I would talk for hours, but because I’d really just as soon not talk about ’em at all. Legal fees, charging ’em, collecting ’em, are the second most stressful aspect of my legal life. If you want to know the most stressful, it’s having to deal with assholes who are abusing the legal system for personal greed, at the expense of my clients. That, in turn, contributes to the stress of legal fees, since right from jump street I’m believing that in a just world my client shouldn’t be put in the position of having to pay thousands of dollars for legal fees in the first place. I should do my part to make it a just world, shouldn’t I?

I was near dumbfounded when I saw this Dirty Little Secrets article about what some lawyers actually charged their clients for. That kind of stuff is so foreign to anything I would even think about doing, that I wanted to believe the clients were just making it up out of spite. But, I’m afraid that’s probably not the case. So, it got me to thinking that maybe I’m way out of line, in the opposite direction, about how I charge fees.

As opposed to double billing, I’ll actually discount my billing if I think something I spent ten hours doing could maybe have been done in less time if I would’ve worked faster or harder. There’s that popular joke about the 50 year old lawyer who dies and is greeted by St. Peter who says the lawyer looks awfully young, inasmuch as he must be at least 150 according to the time he’s billed his clients. I won’t have that problem. St. Peter will be looking at my time records and asking how I thought I could get by only working four hours a day, like I must be some sort of sloth.

I mean, who can’t work a little harder or a little faster? How many lawyers actually even turn off the clock when they take a 20 minute break from the brief they’re working on? I guess not many. Hmm, maybe I could afford to join a gym if I would think about a case a few times while working out, so I could bill out the gym time. Any guesses how many lawyers actually do that?

Well, in the end, maybe my approach is one of the reasons that once I have a client, I generally have a loyal client. But, I wonder, is that because I’m me, or because I’m cheap? Maybe it’s time to start finding out.

Landowner’s Guide to Oil and Gas Development

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Speaking of landowners, I recently came across the Oil & Gas Accountability Project website. They’re an activist organization aligned with the environmentalist camp, looking to recruit and build on a landowner constituency. They offer a publication entitled “Oil and Gas at Your Door? A Landowner’s Guide to Oil and Gas Development”. It’s a biased presentation of the horrible things that accompany oil and gas development. For example, their Coalbed Methane Project is a campaign “for the protection of critical ecosystems, private ranch lands, and people’s health from the devastating impacts of coalbed methane development.” I have some clients doing CBM development, and haven’t seen anything quite approaching “devastating”. Introductory remarks in the guide state “OGAP has prepared this guide to assist those facing oil and gas development on their land and in their communities”. They should have said, “We’ve prepared this guide to scare you out of leasing your land for oil or gas development and to teach you how to make life for developers so difficult they’ll go away.” Nevertheless, they do manage to cover a lot of oil and gas topics, terminology and law. For that reason I’ve reluctantly included it on the list of reading materials to which I can refer virgin landowners who come to me with the standard question, “How does this lease affect my rights?” To which I start by saying, “It’ll take about a day to cover the important subjects and I charge $xxx an hour, were you planning to spend that much?” Usually they weren’t, so I have to do the quick tour, barely scratching the surface, then try to point them somewhere they can try to educate themselves.

The problem is there’s not much out there that’s both informative and written in terms the uninitiated can digest. There’s an outline called “Oil and Gas Law Outline – Fall 2000” that I downloaded once upon a time while surfing the net. I was later told it was from a course at Texas Tech School of Law taught by Prof. Bruce Kramer. However, Prof. Kramer told me he didn’t write it and didn’t know who the author was. There’s also an IRS training document aimed at educating examiners about oil and gas. They can be downloaded from my Yahoo Briefcase. The OGAP Landowners Guide paints a picture of the worst case scenario which, admittedly, could happen. It fails, however, to describe the more likely scenarios, and definitely omits the best case scenario. After reading it, a landowner who might have signed a lease may decide not to and, as a result, miss out on the retirement income his neighbors are getting in the form of monthly royalties. Someday if I can find the time I’ll search for a publication that’s equally extreme on the other side to balance things out. I suspect such a treatment doesn’t exist. One of my oil clients and I were commiserating recently about the prevalent attitudes toward our respective vocations. We didn’t resolve which are perceived as the greater shysters, only that if we wanted to move up in peoples’ eyes, we should start a used car business.

2009/10/18 Update: Yahoo shut down the “briefcase” feature, so the above link no longer works. The items that were there can now be downloaded with these links: Oil and Gas Law Outline, Oil and Gas IRS Manual, Oil and Gas At Your Door.

2010/02/11 Update: Another resource item: NY Coop Extension Landowners Guide.

2020/04/19 Update: The Oil & Gas Accountability Project (OGAP), which “champions drilling impacted communities in their fights with too-often unresponsive governments (and corporations)”, is now found on the Earthworks website. They still offer the publication, Oil and Gas at Your Door? A Landowner’s Guide to Oil and Gas Development, though apparently downloadable a chapter at a time.

A Really Brief Brief

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Yesterday I posted the “nature of the case” paragraph of a brief I was working on. The finished brief is 25 pages. It occurred to me, however, that it might be shortened a bit. So, what follows is an “arguments and authorities” section for a truly brief brief.

In Hartford Fire Insurance Co. v. Unites States of America, 1986 U.S. Dist. LEXIS 27338, (D.C. Kansas 1986) the federal court set forth a brief summary of Kansas law on the recording of mortgages and deeds as follows: All deeds, mortgages and assignments of mortgages must be recorded to impart notice to subsequent purchasers and mortgagees. K.S.A. 58-2222. No deed, mortgage or assignment of mortgage is valid, “except between the parties thereto, and such as have actual notice thereof, until the same shall be deposited with the register of deeds for record.” Id. at 58-2223. Thus, when a subsequent purchaser buys property for value and without notice of a prior conveyance or mortgage, the subsequent purchaser has priority over the earlier purchaser or mortgagee. E.g., Edwards v. Myers, 127 Kan. 221, 273 P. 468 (1929); Penrose v. Cooper, 88 Kan. 210, 128 P. 362 (1912). The recording of deeds, mortgages and assignments of mortgages acts as constructive notice to the subsequent purchaser. See, generally, Luthi v. Evans, 223 Kan. 622, 576 P.2d 1064 (1978). If no record is made or if the record is ineffectively made, the later purchaser takes free unless he had actual knowledge of the mortgage or prior conveyance.

It is generally understood among the bar that few things in the law are black and white. Yet, some legal principles come close, and if there is any one principle that can be said to come closest to black and white, it is this: In Kansas, a bona fide purchaser takes title free of an unrecorded interest. In re: Cascade Oil Company, Inc., Debtor, et al., 65 B.R. 35; 1986 Bankr. Lexis 5730 (July 8, 1986), citing In re Southworth, 22 B.R. 376 (Bankr. D. Kan. 1982); Smith v. Worster, 59 Kan. 640, 54 P. 676 (1898); Stalcup v. Stalcup, 137 Kan. 141, 19 P.2d 447 (1933); K.S.A. 58-2223. Perhaps even more fundamental is that in a contest between two recorded instruments, the one that’s recorded first prevails.

The decision of the district court should be reversed, the court should be directed to enter judgment for the appellants as bona fide purchasers for value of the 32.7 acres, mineral interest (including gas) and fixtures thereon (gas well), free and clear of any right, title or interest of the appellee, and the matter remanded for disposition of the remaining counter-claims.

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