Nau v. Stonebridge Operating Co., L.L.C. , 2019 Ohio 4747 ( 2019 )

[Cite as Nau v. Stonebridge Operating Co., L.L.C., 2019-Ohio-4747.]
IN THE COURT OF APPEALS OF OHIO
SEVENTH APPELLATE DISTRICT
NOBLE COUNTY
HERMAN AND BETTY NAU,
Plaintiffs-Appellees,
v.
STONEBRIDGE OPERATING COMPANY,LLC ET AL.,
Defendants-Appellants.
OPINION AND JUDGMENT ENTRY
Case No. 19 NO 0466
Motion to Certify a Conflict
BEFORE:
David A. D’Apolito, Cheryl L. Waite, Carol Ann Robb, Judges.
JUDGMENT:
Overruled.
Atty. Ethan Vessels, Fields, Dehmlow and Vessels, 309 Second Street, Marietta, Ohio
45750, and Atty. Andrew Lycans, Critchfield, Critchfield, and Johnston, 225 North
Market Street, P.O. Box 599, Wooster, Ohio 44691, for Plaintiffs-Appellees and
Atty. Daniel Corcoran, Theisen Brock, 424 Second Street, Marietta, Ohio 45750, for
Defendants-Appellants.
–2–
Dated: November 14, 2019
PER CURIAM.
{¶1} On September 16, 2019, Defendants-Appellants, Stonebridge Operating
Company, LLC (“Stonebridge”), Positron Energy Resources, Inc. (“Positron”), SEOR LLC
(“SEOR”), and W.H. Haas Family Ltd. (“Haas”)(collectively “Appellants”), filed a motion to
certify a conflict to the Ohio Supreme Court between our decision and the decision of the
Fourth District in Holland v. Gas Enterprises Co., 4th Dist. Washington No. 14CA35,
2015-Ohio-2527. Plaintiffs-Appellees, Herman and Betty Nau, and Intervening Plaintiff-
Appellee, Siltstone Resources, LLC filed their brief in opposition on September 23, 2019.
Appellants filed their reply brief on September 25, 2019.
{¶2} App.R. 25(A) reads, in pertinent part:
A motion to certify a conflict under Article IV, Section 3(B)(4) of the Ohio
Constitution shall be made in writing no later than ten days after the clerk
has both mailed to the parties the judgment or order of the court that creates
a conflict with a judgment or order of another court of appeals and made
note on the docket of the mailing, as required by App. R. 30(A). * * * A
motion under this rule shall specify the issue proposed for certification and
shall cite the judgment or judgments alleged to be in conflict with the
judgment of the court in which the motion is filed.
{¶3} Article IV, Section 3(B)(4) of the Ohio Constitution reads:
Whenever the judges of a court of appeals find that a judgment upon which
they have agreed is in conflict with a judgment pronounced upon the same
question by any other court of appeals of the state, the judges shall certify
the record of the case to the supreme court for review and final
determination.
{¶4} Hence, the following conditions must be met before and during certification
pursuant to Section 3(B)(4), Article IV of the Ohio Constitution:
First, the certifying court must find that its judgment is in conflict with the
judgment of a court of appeals of another district and the asserted conflict
Case No. 19 NO 0466
–3–
must be “upon the same question.” Second, the alleged conflict must be on
a rule of law – not facts. Third, the journal entry or opinion of the certifying
court must clearly set forth that rule of law which the certifying court
contends is in conflict with the judgment on the same question by other
district courts of appeals. (Emphasis deleted.)
State v. Agee, 7th Dist. Mahoning No. 14 MA 0094, 2017-Ohio-7750, ¶ 4, quoting
Whitelock v. Gilbane Bldg. Co., 66 Ohio St. 3d 594, 613 N.E.2d 1032, (1993), paragraph
one of the syllabus. In addition, the issue proposed for certification must be dispositive of
the case. Agee at ¶ 4, citing State ex rel. Davet v. Sutula, 131 Ohio St. 3d 220, 2012-
Ohio-759, 963 N.E.2d 811, ¶ 2.
{¶5} In Holland, supra, the Fourth District reversed the entry of summary
judgment in favor of the lessors to an oil and gas lease (landowners) based on their failure
to comply with R.C. 5301.10, which requires that persons whose interest in an oil and gas
lease appears “of record or file” be joined in a forfeiture action. The Fourth District opined
that “when [the defendant’s] interrogatory response * * * indicated that Upper Fifteen Mile
Investment had an ‘overriding’ interest in the lease, a genuine issue of material fact arose
over whether the landowners had satisfied their statutory duty under R.C. 5301.10.” Id.
at ¶ 15. The Holland Court recognized that [the defendant’s] response “was not a vague
reference by a defendant to unknown entities or persons,” but “an express reference to
Upper Fifteen Mile Investment and the type of interest claimed.” Id. The Fourth District
concluded that “[o]nce a genuine issue of material fact arose over whether Upper Fifteen
Mile Investment had an interest in the lease, the landowners had a duty under the statute
to either join it as a defendant for their claim to proceed or establish Upper Fifteen Mile
had no legitimate interest.” Id. at ¶16.
{¶6} When Positron and Stonebridge were asked by way of an interrogatory to
state the name and API number for every well located on the property that is subject to
the litigation that has produced oil or gas, or both, they responded, “Noll C and Baker C
#1 API #: 34121217790000 There may be other wells on the Lease.” (Emphasis added).
When asked to state the name and address of every person or entity that claims an
interest in the oil and gas lease that is the subject of this litigation, Positron and
Stonebridge responded, “N/A.”
Case No. 19 NO 0466
–4–
{¶7} Positron and Stonebridge also filed the affidavit of Stonebridge’s manager,
Eddy Biehl, written in the third-person, in which he averred that “[b]ased upon public
records it is believed there are other wells operating and producing that may be in the
300 acre tract but he has not seen certified title work to that effect.” (Biehl Aff. ¶7.) Biehl
further averred that “[h]e believes but has not verified that this same 300 acre tract may
be subject to a lease of B&N Coal.” (Id. ¶ 9.)
{¶8} During a status conference on August 1, 2018, the trial court ordered
Positron and Stonebridge to provide the names of those persons or entities claimed to
have an interest in the “deep rights” together with the volume and page of the recorded
instruments creating the interest. Positron and Stonebridge were further ordered to
provide “[t]he name and location of any wells (other than the one in question) that are or
were in existence on the leased premises.” (8/7/18 J.E., p. 1).
{¶9} On September 5, 2018, Positron and Stonebridge filed documents
evidencing potential title in SEOR and Haas. They made no reference to additional wells
in the pleading, and did not rely on any of the documents filed on September 5, 2018 to
demonstrate the existence of additional wells on the leasehold. SEOR and Hass were
joined as parties pursuant to an agreed order dated October 12, 2018.
{¶10} R.C. 5301.10 reads, in its entirety:
The plaintiff in an action to cancel a lease or license mentioned in section
5301.09 of the Revised Code, or in any way involving it, in order to finally
adjudicate and determine all questions involving such lease or license in
such action, need only make those persons defendants, so far as such
lease or license is involved, who claim thereunder and are in actual and
open possession, and those who then appear of record, or by the files in
such office, to own or have an interest in such lease or license. If there is
no claimant in actual and open possession, and no persons whose interest
appears of record or file, then so far as such lease or license is involved, it
will only be necessary to make the original lessee or licensee defendant in
order to finally adjudicate and determine all questions concerning such
lease or license.
Case No. 19 NO 0466
–5–
{¶11} Appellants assert that we shifted the R.C. 5301.10 duty to Appellants
because we recognized that they were parties “‘most likely to have knowledge of the
actual number of wells operating on the leasehold.’” (Reply Brf., 2.) To the contrary,
Positron and Stonebridge were ordered by the trial court as a part of the discovery
process to provide the names and locations of any other wells that are or were in
existence on the leased premises. We merely recognized that Appellees could rely on
the response by Positron and Stonebridge to the trial court’s order to establish that no
additional wells existed. Appellants’ argument conflates their discovery obligation with
the burden of proof in this case.
{¶12} Appellants assert that “[i]n Holland and in this case the defendants
presented the same evidence and information in response to the landowner’s motion for
summary judgment.” (Emphasis in original)(Mot. To Certify, p. 4-5.) The response to
interrogatory in Holland plainly stated that a non-party had an overriding interest in the
lease. Here, the responses to interrogatories and the Biehl affidavit offered conjecture
that non-parties may have an interest in the lease. As a consequence, we found no
genuine issue of material fact.
{¶13} The response to the interrogatory in Holland was definitive, whereas the
responses to interrogatories and the averments in the Biehl affidavit in this case were
speculative. Because the distinction between Holland and the above-captioned case
turns on the facts, rather than the law, the motion to certify conflict is overruled.
JUDGE DAVID A. D’APOLITO
JUDGE CHERYL L. WAITE
JUDGE CAROL ANN ROBB
NOTICE TO COUNSEL
This document constitutes a final judgment entry.
Case No. 19 NO 0466
–6–
Case No. 19 NO 0466