Oil & Gas Leases Offer New Potential to Resolve Debts, Youngstown Creditors Rights Lawyer Says
- January 8, 2014
YOUNGSTOWN, Ohio — One of the effects of northeastern Ohio’s shale energy boom is the improving potential for creditors to collect debts, a leading creditors rights lawyer says.
“Lease-signing bonuses and royalty payments represent new assets for creditors to pursue,” said Frederick S. Coombs S. III, chair of the creditors rights and bankruptcy law practice group at Harrington, Hoppe & Mitchell, a regional law firm based in Youngstown.
“Some debts that once appeared uncollectible may now be worth pursuing, thanks to the rise of oil and gas activity.”
These recent developments reflect the improving landscape for creditors across the Utica Shale:
- A creditor recently secured payment on a $7.5 million judgment by tying up lease-signing bonuses that were due to the debtor/landowner.
- A lender that was owed more than $500,000 on a mortgage recently collected the debt when a third-party bought the lender’s mortgage on borrower’s property for its mineral rights.
“There are new and creative mechanisms for getting large debts paid,” Coombs said. “Our experience suggests that an energy company dedicated to signing a lease can be an effective partner in getting an old debt resolved.”
Harrington, Hoppe & Mitchell Ltd. is the area’s largest law firm, with offices in Youngstown, Warren and Salem. The firm provides legal solutions to corporations, other businesses, non-profit organizations, government agencies and individuals.