Greer v. Frye , 2017 Ohio 4035 ( 2017 )

[Cite as Greer v. Frye, 2017-Ohio-4035.]
STATE OF OHIO, BELMONT COUNTY
IN THE COURT OF APPEALS
SEVENTH DISTRICT
RALPH GREER, ET AL., )
)
PLAINTIFFS-APPELLEES, )
) CASE NO. 14 BE 0032
V. )
) OPINION
RUTH D. FRYE, ET AL., )
)
DEFENDANTS-APPELLANTS. )
CHARACTER OF PROCEEDINGS: Civil Appeal from Court of Common
Pleas of Belmont County, Ohio
Case No. 13CV0244
JUDGMENT: Reversed and Judgment Entered for
Appellants
APPEARANCES:
For Plaintiffs-Appellees Attorney David E. Butz
Attorney Matthew W. Onest
4775 Munson St., NW/P.O. Box 36963
Canton, Ohio 44735-6963
For Defendants-Appellants Attorney Stephen R. McCann
Attorney Travis M. Jones
17 N. 4th St., P.O. Box 340
Zanesville, Ohio 43702-0340
JUDGES:
Hon. Gene Donofrio
Hon. Cheryl L. Waite
Hon. Carol Ann Robb
Dated: May 30, 2017
[Cite as Greer v. Frye, 2017-Ohio-4035.]
DONOFRIO, J.
{¶1} Defendant-appellants, Ruth Frye, C. Dale Bunting, Melodie Hendershot,
Herman Speece, and Scott King, appeal from a Belmont County Common Pleas
Court judgment granting summary judgment to plaintiffs-appellees, Ralph and
Sharley Greer, on appellees’ claim for a declaratory judgment finding that certain
mineral interests had vested with appellees.
{¶2} The parties have stipulated to the facts of this case as follows.
{¶3} Appellees are the owners of three tracts of land in Belmont County,
collectively referred to as the “Real Estate.” The “First Tract,” “Second Tract,” and
“Third Tract” each constitute approximately 20 acres for a total of approximately 60
acres.
{¶4} In 1937, Roy and Goldie Crooks acquired the Third Tract’s surface
rights and one-half of its oil and gas rights. That same year, the Crooks acquired the
First and Second Tract’s surface rights and their oil and gas rights.
{¶5} In 1974, the Crooks retained an interest in the oil and gas rights
underlying the Real Estate in a warranty deed to James Haren.
{¶6} In June 1991, James Haren transferred his interest in the Real Estate to
Marcia Haren.
{¶7} In 1998, appellees acquired the Real Estate by way of a warranty deed
from Marcia Haren.
{¶8} On January 27, 2011, appellees published a Notice of Abandonment in
a newspaper of general circulation in Belmont County.
{¶9} Sarah Hanlon, Ruth Frye, Edna Speece, Betty Wingrove, and Mary
King are the daughters and sole heirs of Roy and Goldie Crooks.
{¶10} On March 16, 2011, appellants’ predecessor-in-title Sarah Hanlon filed
an Affidavit to Preserve Mineral Interests. On April 19, 2011, Hanlon executed and
recorded two Affidavits for Transfer and Record of Real Estate Inherited naming the
appellants or their predecessors-in-title, claiming that each had an undivided one-fifth
interest in the Crooks’ reservation. Appellants Bunting and Hendershot claim an
undivided one-fifth interest in the Crooks’ reservation by virtue of a quitclaim deed
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granted from Hanlon recorded March 14, 2012.
{¶11} On November 5, 2012, appellants entered into a lease agreement to
lease the Crooks’ reservation to Rice Drilling, LLC. Appellants are the only living
Crooks’ heirs and/or are the only successors-in-interest to Roy and Goldie Crooks
relating to the Crooks’ reservation. Appellants claim to possess an interest in the
Real Estate’s oil and gas rights by way of their status as the Crooks’ heirs.
{¶12} On July 11, 2013, appellees filed a complaint against appellants and
Rice Drilling raising numerous claims and seeking to quiet title to the oil and gas
interest underlying the Real Estate in their favor. They asserted that the 1989 Ohio
Dormant Mineral Act (ODMA) operated to reunite the mineral rights with the surface
owners, thereby vesting the mineral rights with them. Appellants filed an answer and
counterclaim raising several claims and seeking to quiet title in their favor.
Appellants also requested a declaration that the 1989 ODMA had been repealed and
replaced by the 2006 version of the ODMA. As Rice Drilling did not respond, the trial
court granted appellees’ motion for default judgment against it.
{¶13} Appellees and appellants filed competing motions for summary
judgment based on the ODMA and making various arguments regarding the
application of the 1989 version of the ODMA and the 2006 version of the ODMA.
{¶14} The trial court found that the Crooks transferred surface of the Real
Estate by way of warranty deed recorded July 10, 1974. It found the oil and gas
therein was reserved in the deed and qualified as a title transaction pursuant to the
1989 ODMA. The court found that from July 10, 1974 to July 10, 1994 (the 20-year
lookback period under the 1989 ODMA) there were no further savings events. The
court further found that under the 1989 ODMA, the severed mineral interest owners
must periodically preserve their mineral interest by complying with the statute’s
requirements every 20 years.
{¶15} The trial court went on to find that the filing of the general warranty
deed on July 10, 1974, started the clock on appellants’ interest. Because no action
was taken for 20 years from that date, on July 10, 1994, pursuant to the 1989 ODMA,
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appellants’ ownership interests expired. The trial court found that because of this
holding, any discussion of the 2006 ODMA was moot.
{¶16} Therefore, the trial court granted appellees’ motion for summary
judgment and denied appellants’ motion for summary judgment. The court declared
appellees to be the owners of the mineral rights underlying the Real Estate and
declared appellants’ lease for those rights to be rescinded.
{¶17} Appellants filed a timely notice of appeal on July 25, 2015. This court
held the appeal in abeyance pending the Ohio Supreme Court’s decisions in several
oil and gas cases. This case is now ready for review.
{¶18} Appellants raise two assignments of error both dealing with the trial
court’s summary judgment rulings.
{¶19} An appellate court reviews the granting of summary judgment de novo.
Comer v. Risko, 106 Ohio St.3d 185, 2005-Ohio-4559, 833 N.E.2d 712, ¶ 8. Thus,
we shall apply the same test as the trial court in determining whether summary
judgment was proper.
{¶20} A court may grant summary judgment only when (1) no genuine issue
of material fact exists; (2) the moving party is entitled to judgment as a matter of law;
and (3) the evidence can only produce a finding that is contrary to the non-moving
party. Mercer v. Halmbacher, 9th Dist., 2015-Ohio-4167, 44, 44 N.E.3d 1011 N.E.3d
1011, ¶ 8; Civ.R. 56(C). The initial burden is on the party moving for summary
judgment to demonstrate the absence of a genuine issue of material fact as to the
essential elements of the case with evidence of the type listed in Civ.R. 56(C).
Dresher v. Burt, 75 Ohio St.3d 280, 292, 662 N.E.2d 264 (1996). If the moving party
meets its burden, the burden shifts to the non-moving party to set forth specific facts
to show that there is a genuine issue of material fact. Id.; Civ.R. 56(E). “Trial courts
should award summary judgment with caution, being careful to resolve doubts and
construe evidence in favor of the nonmoving party.” Welco Industries, Inc. v. Applied
Cos., 67 Ohio St.3d 344, 346, 617 N.E.2d 1129 (1993).
{¶21} Appellants’ first assignment of error states:
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THE TRIAL COURT ERRED IN GRANTING SUMMARY JUDGMENT
FOR PLAINTIFFS-APPELLEES.
{¶22} Given recent changes in the law, appellants now argue that the trial
court’s summary judgment in favor of appellees must be reversed since it relied on
the 1989 ODMA.
{¶23} Recently, in Corban v. Chesapeake Expl., L.L.C., __ Ohio St.3d __,
2016-Ohio-5796, __ N.E.3d __, ¶ 26-28, the Ohio Supreme Court held that the 1989
ODMA was not self-executing and did not automatically transfer a mineral rights
interest from the mineral rights holder to the surface owner by operation of law.
Instead, a surface owner seeking to merge those rights with the surface estate under
the 1989 ODMA was required to commence a quiet title action seeking a decree that
the dormant mineral interest was deemed abandoned. Id. at ¶ 28.
{¶24} The 2006 ODMA provides that a dormant mineral interest “shall be
deemed abandoned and vested in the owner of the surface of the lands subject to
the interest if the requirements established in division (E) of this section are satisfied.”
Id. at ¶ 29; R.C. 5301.56(B). The Court went on to hold:
Dormant mineral interests did not automatically pass by operation of
law to the surface owner pursuant to the 1989 law. Thus, as of June 30,
2006, any surface holder seeking to claim dormant mineral rights and
merge them with the surface estate is required to follow the statutory
notice and recording procedures enacted in 2006 by H.B. 288. These
procedures govern the manner by which mineral rights are deemed
abandoned and vested in the surface holder and apply equally to claims
that the mineral interests were abandoned prior to June 30, 2006.
Id. at ¶ 31.
{¶25} The Ohio Supreme Court reiterated its holding stating “the 2006 version
of the Dormant Mineral Act applies to all claims asserted after 2006 alleging that the
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rights to oil, gas, and other minerals automatically vested in the owner of the surface
estate prior to the 2006 amendments.” Walker v. Shondrick-Nau, __ Ohio St.3d __,
2016-Ohio-5793, __ N.E.3d __, ¶ 16, citing Corban at ¶ 2.
{¶26} Given the Ohio Supreme Court’s holding that the 2006 ODMA applies
to all claims asserted after 2006, and because appellees’ claim was not asserted until
2011, the 2006 ODMA applies to this case. Therefore, the trial court erred in granting
summary judgment in favor of appellees based on the 1989 ODMA.
{¶27} Accordingly, appellants’ first assignment of error has merit and is
sustained.
{¶28} Appellants’ second assignment of error states:
THE TRIAL COURT ERRED IN NOT GRANTING SUMMARY
JUDGMENT IN FAVOR OF DEFENDANTS-APPELLANTS.
{¶29} Given the Ohio Supreme Court’s decisions in Corban and Walker,
appellants assert we should enter judgment that they are the rightful owners of the
mineral interests pursuant to the 2006 ODMA. They assert that because they filed a
claim to preserve within 60 days after notice of the surface owners’ intent to declare
those interests abandoned, they precluded their mineral interest from being
abandoned. Citing, Dodd v. Croskey, 143 Ohio St.3d 293, 2015-Ohio-2362, 37
N.E.3d 147, ¶ 37.
{¶30} In this case, after the trial court determined that the 1989 ODMA vested
the mineral rights back with appellees as the surface owners, it found “any discussion
of the 2006 Ohio Dormant Mineral Act is hereby rendered moot.” Thus, the trial court
did not enter a ruling regarding the 2006 ODMA.
{¶31} In light of the Ohio Supreme Court’s judgment that the 2006 ODMA
applies, summary judgment in appellants’ favor is appropriate. In their motion for
summary judgment, appellants argued that they were entitled to judgment under both
the 1989 ODMA and the 2006 ODMA. Moreover, the parties stipulated to all relevant
facts including the facts that appellees published a Notice of Abandonment on
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January 27, 2011, and appellants filed an Affidavit of Claim to Preserve Mineral
Interests on March 16, 2011. (Stipulations of Fact, ¶ 8, 10). Because appellants
timely filed a claim to preserve, they halted the abandonment.
{¶32} Accordingly, appellants’ second assignment of error has merit and is
sustained.
{¶33} For the reasons stated above, the trial court’s judgment is hereby
reversed. Because appellants timely filed a claim to preserve, they precluded their
mineral interest from being abandoned. Summary judgment is entered in appellants’
favor.
Waite, J., concurs.
Robb, P.J., concurs.