HB 671 — An Act providing for plain language requirements in oil and gas real property contracts, for remedies and for penalties.

PRINTER'S NO.    678

                   THE GENERAL ASSEMBLY OF PENNSYLVANIA



                        HOUSE BILL
                        No. 671
                                               Session of
                                                 2025

     INTRODUCED BY WEBSTER, SANCHEZ, KHAN, GUENST, WAXMAN, HILL-
        EVANS, HADDOCK, OTTEN AND NEILSON, FEBRUARY 20, 2025

     REFERRED TO COMMITTEE ON JUDICIARY, FEBRUARY 20, 2025


                                    AN ACT
 1   Providing for plain language requirements in oil and gas real
 2      property contracts, for remedies and for penalties.
 3      The General Assembly of the Commonwealth of Pennsylvania
 4   hereby enacts as follows:
 5   Section 1.   Short title.
 6      This act shall be known and may be cited as the Plain
 7   Language Oil and Gas Real Property Contract Act.
 8   Section 2.   Definitions.
 9      The following words and phrases when used in this act shall
10   have the meanings given to them in this section unless the
11   context clearly indicates otherwise:
12      "Contract."    A written agreement between a landowner and an
13   oil and gas land broker, landman, oil company or gas company for
14   the sale, transfer, conveyance or lease of real property.
15      "Landowner."   An individual or group of individuals with
16   interest in real property or named on the deed or title of the
17   real property.
18   Section 3.   Test of readability.
 1      (a)   Requirements.--A contract shall be written, organized
 2   and designed so that the contract is easy to read and
 3   understand.
 4      (b)   Language guidelines.--In determining whether a contract
 5   meets the requirements of subsection (a), a court shall consider
 6   the following language guidelines:
 7            (1)    The contract should use short words, sentences and
 8      paragraphs.
 9            (2)    The contract should use active verbs.
10            (3)    The contract should not use technical legal terms
11      other than commonly understood legal terms.
12            (4)    The contract should not use Latin and foreign words
13      or any other word when its use requires reliance upon an
14      obsolete meaning.
15            (5)    The contract must define industry-specific terms
16      whose definitions have meanings which are not commonly
17      understood.
18            (6)    The definitions of words defined in the contract
19      should be defined by using commonly understood meanings.
20            (7)    When the contract refers to the parties to the
21      contract, the references should use personal pronouns, the
22      actual or shortened names of the parties, the terms "seller"
23      and "buyer" or the terms "lessor" and "lessee."
24            (8)    The contract should not use sentences that contain
25      more than one condition.
26            (9)    The contract should not use cross references, except
27      cross references that briefly and clearly describe the
28      substances of the item to which the reference is made.
29            (10)    The contract should not use sentences with double
30      negatives or exceptions to exceptions.

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 1      (c)   Visual guidelines.--In determining whether a contract
 2   meets the requirements of subsection (a), a court shall consider
 3   the following guidelines:
 4            (1)   The contract should have type size, line length,
 5      column width, margins and spacing between lines and
 6      paragraphs that make the contract easy to read.
 7            (2)   The contract should caption sections in boldface
 8      type.
 9            (3)   The contract should use ink that contrasts sharply
10      with the paper.
11   Section 4.     Notarization of contracts.
12      (a)   Execution.--A contract shall be signed by the landowner
13   in the presence of a notary public in this Commonwealth.
14      (b)   Receipt of contract.--The landowner and buyer or lessee
15   shall receive a notarized copy of the contract.
16   Section 5.     Damages and enforcement.
17      (a)   Damages and other remedies.--An oil and gas land broker,
18   landman, oil company or gas company that executes a contract
19   with a landowner that does not comply with the test of
20   readability provided under section 3 is liable to the landowner
21   for all of the following:
22            (1)   Compensation in an amount equal to the value of any
23      actual loss caused by the violation of this act.
24            (2)   Statutory damages of $10,000.
25            (3)   Court costs.
26            (4)   Reasonable attorney fees.
27            (5)   Any equitable and other relief ordered by the court.
28      (b)   Enforcement.--A violation of this act is deemed to be a
29   violation of the act of December 17, 1968 (P.L.1224, No.387),
30   known as the Unfair Trade Practices and Consumer Protection Law.

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 1   Section 6.     Limitations on liability.
 2      (a)   Limitation generally.--There shall be no liability under
 3   section 5 if any of the following occur:
 4            (1)   The landowner wrote the contract or part of the
 5      contract that violates this act.
 6            (2)   The oil and gas land broker, landman, oil company or
 7      gas company made a good faith and reasonable effort to comply
 8      with this act.
 9      (b)   Time limit to file lawsuit.--A lawsuit under this act
10   must be filed within 10 years from the date on which the
11   contract was executed.
12   Section 7.     Applicability.
13      This act shall apply to the following:
14            (1)   All contracts that are executed, solicited or
15      intended to be performed on or after the effective date of
16      this section.
17            (2)   A renewal, extension, option or change in the terms
18      of an existing contract on or after the effective date of
19      this section.
20   Section 8.     Effective date.
21      This act shall take effect in one year.




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