We’ve become aware that oil and gas construction contractors have been placing liens against landowner properties. These contractors are using landowners as pawns in their disputes with the companies that hired them to build oil and gas equipment and facilities.
So, how does this happen?
Well, the law in most states allows contractors or others who do work to place “mechanics liens” against property when contractors have done work on the property, but have not been paid. The laws were intended to protect businesses who were not getting paid for work that they performed to repair or improve property.
Certain oil and gas construction companies have attempted to extend that to their protection at the expense of landowners. Landowners have signed surface use or right of way agreements, which allow gas companies to build pipelines, well pads or other facilities on their land. When the gas companies have had trouble paying their construction bills, some of those contractors have resorted to filing mechanics liens.
Those liens, however, have not just been filed against the equipment owned by the gas company, those liens have been filed against the actual real estate where the facility is located. Landowners, sometimes with notice and sometimes without, have had hundreds of thousands of dollars in liens placed against their land.
How might that affect you? Well, if you were looking to sell your home you may be prevented from doing so unless and until that lien is paid off. The same goes for re-financing. If you were looking to re-finance your mortgage agreement to get a better rate or do renovations, it is highly possible a bank would balk at providing new or additional funds while the lien is in place.
Fortunately, West Virginia law has become a bit more protective of landowners on this front. The West Virginia Supreme Court of Appeals has recently ruled that those “liens” filed by third party oil and gas contractors are not valid or appropriate against individual landowners in most circumstances.
Despite this ruling, some oil and gas contractors have continued to file such liens and leave them on record at local courthouses. Bordas & Bordas, PLLC is currently pursuing these types of cases against these contractors asserting slander of title claims. Additional claims may even be possible based on the facts of your case.
If an oil and gas operator has placed a lien against your property for unpaid bills give us a call to discuss your rights.