Non-Disclosure Agreements signed by Gas Lessors

Posted: June 15, 2010

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and information purposes only, and does not provide legal advice on
any specific legal matter or factual situation. Legal advice is dependent
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Some people who signed gas leases, also signed a non-disclosure

agreement. This agreement was included for lessors who negotiated
terms above and beyond that which [was] offered to others in the
area and was intended to prevent neighbors from discussing the
amount of money they received. The rate of compensation, both per
acre signing bonuses and royalty percentages, resulted from
negotiations between the landsman and the landholder and amounts
are highly variable. The non-disclosure clause is designed to prevent
someone who negotiated a high rate of compensation from influencing
the negotiations of other landholders.

It is questionable whether such non-disclosure clauses are valid if the

non-disclosure agreement was not discussed before the lease was
signed and before the financial terms were agreed upon. For a
promise to be enforceable, there must have been something given in
exchange, a consideration. If the payment for the lease was already
agreed before the clause was presented and no additional
consideration was offered for the non-disclosure agreement, then as a
general matter the non-disclosure agreement would not be
enforceable. Of course, whether a particular non-disclosure agreement
is enforceable will depend upon the terms of the non-disclosure
agreement, whether any consideration was received for the
agreement, and the negotiations of the parties to the agreement.

Regardless of the validity of the non-disclosure clause, the survey that

Fleased has designed (see fleased.org) does not include information
about the financial terms of the lease. Additionally, the identity of
survey respondents will remain confidential. Survey responses will be
aggregated and not attributed to individual respondents.