Al-Omar v. Exco Services

Case Type:
Case Status:
21-20078 (5th Circuit, Dec 16,2021) Not Published
Per curiam, the U.S. Court of Appeals for the Fifth Circuit (Circuit) affirmed the opinion of the U.S. District Court for the Southern District of Texas (DC) affirming adjudication of claims for unpaid royalties from oil and gas leases filed by Nkruman Al-Omar and Eunice Hall (collectively, Appellants) against EXCO Services, Inc., and its debtor-affiliates (collectively, EXCO) by the U.S. Bankruptcy Court for the Southern District of Texas (BC), limiting review to the only order-a fee and cost award-appealed within 14 days of its issue and over which it thus had jurisdiction per Rule 8002(a).
Procedural context:
When EXCO voluntarily filed for chapter 11 bankruptcy, Appellants filed three proofs of claim based on their two Louisiana oil and gas leases with EXCO (Leases): two for $42,230 each based on an alleged “lease extension and breach of lease due to untimely payments” and one for an “undetermined” amount based on “Royalty” payments. EXCO objected, contending it had paid Appellants all amounts owed under the Leases. After an evidentiary hearing in December 2019, the BC orally ruled that there were no improper deductions to the royalties and that, despite some late payments, all amounts owed under the Leases had been paid. On July 23, 2020, the BC then entered a written order that memorialized its oral ruling, specifically holding that (1) EXCO had made all royalty payments to which Appellants were entitled under the Leases, (2) special damages for late payments were not warranted, and (3) Appellants were entitled to interest on late royalty payments and attorney fees, the costs associated with representing themselves. In October 2020, after the parties had submitted, as directed, proposed orders calculating the interest and fees, the BC ordered payment of $914.49 in interest and $5,088.58 in costs associated with Appellants’ pro se representation for each of the first two proofs of claim, disallowed the third as duplicative, and specifically denied Appellants' attempt to get fees for the legal representation provided by an unlicensed attorney, Leroy Johns (Johns). Timely appealing the October 2020 order to the DC, the Appellants challenged both the merits rulings from the July 2020 order and the BC's failure to award fees for Johns' services. The DC orally affirmed the BC. The Appellants once more timely appealed.
Prepetition, the Appellants had signed the Leases with EXCO, an oil and gas company operating in Texas and Louisiana. When EXCO voluntarily filed for chapter 11 bankruptcy, Appellants had filed three proofs, to which EXCO objected. Appellants attempted to proceed represented by one's son, Johns. Though not a licensed attorney, Johns appeared on Appellants’ behalf at a June 2019 hearing and a November 2019 conference before EXCO objected to his efforts. The BC sustained the objection; it further advised Appellants to represent themselves or hire counsel. Appellants opted to proceed pro se.
Patrick E. Higginbotham; Stephen A. Higginson; and S. Kyle Duncan

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