Snyder v. Ohio Dept. of Natural Resources ( 2012 )

[Cite as Snyder v. Ohio Dept. of Natural Resources, 2012-Ohio-4039.]
STATE OF OHIO, JEFFERSON COUNTY
IN THE COURT OF APPEALS
SEVENTH DISTRICT
RONALD SNYDER, et al., ) CASE NO. 11 JE 27
)
PLAINTIFFS-APPELLANTS, )
)
VS. ) OPINION
)
OHIO DEPARTMENT OF NATURAL )
RESOURCES, et al., )
)
DEFENDANTS-APPELLEES. )
CHARACTER OF PROCEEDINGS: Civil Appeal from Common Pleas Court,
Case No. 09CV243.
JUDGMENT: Affirmed.
APPEARANCES:
For Plaintiffs-Appellants: Attorney John Keller
Attorney Philip Downey
Attorney William Sieck
52 East Gay Street
P.O. Box 1008
Columbus, Ohio 43216-1008
For Defendants-Appellees: Attorney Michael DeWine
Attorney General
Attorney Molly Corey
Attorney Tara Paciorek
Assistant Attorneys General
2045 Morse Road, Building D-2
Columbus, Ohio 43229
JUDGES:
Hon. Joseph J. Vukovich
Hon. Cheryl L. Waite
Hon. Mary DeGenaro
Dated: August 27, 2012
[Cite as Snyder v. Ohio Dept. of Natural Resources, 2012-Ohio-4039.]
VUKOVICH, J.
{¶1} Plaintiffs-appellants Ronald Snyder and Steven Neeley appeal the
decision of the Jefferson County Common Pleas Court which granted summary
judgment in favor of defendants-appellees the Ohio Department of Natural
Resources and the State of Ohio and thus disposing of the declaratory judgment
action filed by appellants.
{¶2} The issue on appeal is whether strip mining on the state’s land is
permissible where the language of the deed provides, “The Grantors reserve all
mineral rights, including rights of ingress and egress and reasonable surface right
privileges.” As the case law in Ohio requires the deed reserving mineral rights to
clearly show the intent to allow strip mining, it appears the above language does not
grant the right to strip mine the property.
{¶3} The other issue raised concerns whether the court properly declared
the parties’ respective rights when it granted summary judgment in the declaratory
judgment action. Because the court filed not only a judgment entry but also a
separate opinion, the declaration of rights is ascertainable. Accordingly, it seems that
judgment was properly entered in favor of the state, and the trial court’s decision can
be affirmed.
STATEMENT OF THE CASE
{¶4} In 1944, the grantor sold over 651 acres located in Brush Creek
Township to the State of Ohio. This property became part of the Brush Creek Wildlife
Area, which is overseen by the Ohio Department of Natural Resources (ODNR).
Regarding the reservation of mineral rights, the only pertinent language in the deed
states: “The Grantors reserve all mineral rights, including rights of ingress and
egress and reasonable surface right privileges.”
{¶5} In 2000, Ronald Snyder and Ralph Six received these mineral rights
upon a Sheriff’s Deed in Partition. They later met with ODNR to discuss their desire
to strip mine part of the property. When ODNR refused to allow strip mining (also
called surface mining) on the property, the two mineral rights owners filed a complaint
against the state and ODNR seeking a declaratory judgment.
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{¶6} Their complaint stated that the property contains valuable coal reserves
which are thinly layered, making the only practicable method of extracting the coal by
“surface mining and auger mining in a surface mining area.” The complaint asked for
a declaration that the “reasonable surface right privileges” language in the deed
allowed them to strip mine a reasonable portion of the property. They asked for a
declaration that approximately 10% of the property would be a reasonable portion of
the property to surface mine.
{¶7} The complaint was voluntarily dismissed and refiled in May of 2009.
Thereafter, Steven Neely was substituted as a party in place of Mr. Six. The state
filed a motion for summary judgment in June of 2011, urging that case law requires a
mineral rights reservation to include clear language if the right to destroy the surface
is to be transferred as surface mining is inconsistent with the surface owner’s rights.
{¶8} On September 7, 2011, the trial court ruled in favor of the state,
granting summary judgment and dismissing the case with prejudice. The trial court
held that the right to strip mine must be clearly expressed in the reservation of
mineral rights. The court stated that the reservation of “reasonable surface right
privileges” is not ambiguous as to whether strip mining is permitted, even if it could
be ambiguous regarding other surface rights, because strip mining entails a
catastrophic disruption to the surface. Thus, the court found that the extrinsic
evidence presented by the plaintiffs in their response to summary judgment could not
be used. The court alternatively stated that the evidence relied on to show the
parties’ intent at the time of the deed was inadmissible hearsay in any event.
{¶9} On September 26, 2011, the trial court filed a final judgment entry
granting the State’s motion for summary judgment and dismissing the case with
prejudice based upon the opinion the court previously rendered. The plaintiffs-
appellants filed a notice of appeal on October 25, 2011. This court ordered
appellants to file a jurisdictional memorandum as to why they failed to appeal from
the September 7 order. Appellants responded citing case law and the local rules of
court. On December 27, 2011 this court found that the appeal was timely filed.
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{¶10} The table of contents in appellants’ brief lists numerous arguments,
some of which could be construed as assignments of error, although not labeled as
such. Moreover, the listed arguments are overlapping and mostly concern one issue:
whether the deed is ambiguous as to strip mining. If we agree with appellants and
find the deed ambiguous, they ask us to resolve which party should have the
language construed in their favor and argue that the trial court improperly stated that
the extrinsic evidence on the parties’ intent was inadmissible hearsay. Finally, there
is an issue with the form of the court’s entry as appellants do not believe it clearly
declares the rights as required in a declaratory judgment action. We thus separate
our analysis into these three sections.
DOES DEED CLEARLY IMPORT RIGHT TO STRIP MINE?
{¶11} Appellants acknowledge that Ohio case law requires some expression
of the right to strip mine in a mineral rights reservation. Appellants note, however,
that this law does not require the deed to expressly include the words “strip mine” or
“surface mine” as “magic language” before strip mining is permissible under a grant
of mineral rights. Appellants argue that the deed’s language is ambiguous and that
what activity constitutes the exercise of “reasonable” surface right privileges is a
question of fact as it is susceptible to more than one interpretation since a
reasonable person could construe it as allowing strip and auger mining on a small,
reasonable portion of the property.
{¶12} The state counters that it is established law that there must be a clear
expression of the intent to reserve the right to strip mine in a mineral rights
reservation. See Graham v. Drydock Coal Co., 76 Ohio St.3d 311, 667 N.E.2d 949(1996); Skivolocki v. East Ohio Gas Co., 38 Ohio St.2d 244, 313 N.E.2d 374 (1974).
The state concludes that a reasonable person could not construe the deed to allow
total destruction of a considerable portion of the surface through strip mining merely
because it permits reasonable surface right privileges incident to mining, which
privileges exist by law in any case.
{¶13} Appellants attempt to distinguish Skivolocki and Graham from their
case. Appellants note that the Skivolocki deed was written prior to the use of strip
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mining in that county and contained language peculiar to deep mining. Appellants
acknowledge, however, that the Graham case refused to distinguish Skivolocki on
the basis that the Graham deed was drafted after the advent of strip mining.
Appellants then argue that Graham is distinguishable by noting that the Graham
deed involved language peculiar to deep mining and the deed revealed that the
surface use was farming, which is inconsistent with strip mining, whereas the deed
here did not reveal that the land would be used as a wildlife preserve.
{¶14} If a deed is clear and unambiguous, then its interpretation is a matter of
law subject to de novo review. See Nationwide Mut. Fire Ins. Co. v. Guman Bros.
Farm, 73 Ohio St.3d 107, 108, 652 N.E.2d 684 (1995). See also Graham, 76 Ohio
St.3d at 313. The intent of the parties resides in the language they chose in the
deed. Graham, 76 Ohio St.3d at 313. Extrinsic evidence is not admissible to show
intent where the language is clear and unambiguous. Id. at 314. An ambiguous
provision is one that has more than one reasonable interpretation. Hacker v.
Dickman, 75 Ohio St.3d 118, 119-120, 661 N.E.2d 1005 (1996).
{¶15} In deeds involving mineral rights, the Supreme Court of Ohio has
developed special rules of construction where the right to destroy the surface is
claimed by the owner of the mineral rights. In 1884, the Ohio Supreme Court stated
that it was well-settled that when mineral rights are severed from the surface, the
owner of the mineral rights is entitled to only so much of the minerals he can get
without injury to the superincumbent soil unless the language of the instrument
“clearly imports” that it was the intention of the surface owner to part with the right of
subjacent support. Burgner v. Humphrey, 41 Ohio St. 340, 352 (1884). The same
obligation to protect the surface exists whether there is a conveyance of the surface
retaining the minerals (as in the case at bar) or whether there is a conveyance of the
minerals retaining the surface. Id. at 352-353.
{¶16} In Burgner, the owner of the mineral rights mined coal underground and
removed all support from under the surface causing subsidence. The Court declared
that the owner of the surface had the natural right to use his land “in the situation in
which it was placed by nature” and thus had the right to have the surface integrity
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maintained notwithstanding the grant of mineral rights to another. Id. A clause that
the owner of the mineral rights can remove “all the mineral coal” does not mean that
it can be taken away without regard to the effect of its removal upon the overlying
soil. Id. at 354-355. The Court concluded that the intention to dispense with subjacent
support should be “manifested by clear and unequivocal language” in the deed. Id.
at 354. The surface owner’s waiver of the right to surface support must appear by
express grant or the deed must “clearly import such release.” Ohio Collieries Co. v.
Cocke, 107 Ohio St. 238, syllabus, 140 N.E. 356 (1923).
{¶17} In Skivolocki, a 1901 deed granted mineral rights, including the right to
construct air shafts. Slivolocki v. East Ohio Gas Co., 38 Ohio St.2d 244, 313 N.E.2d
374 (1974). The deed also stated “for any and all surface used” the mining company
shall pay fifty dollars per acre. Id. at 246. The mining company, in pursuing strip
mining on the land, argued that this clause granted the unqualified right to use the
surface in any manner for the stated price or constituted a waiver a subjacent
support. Id. at 247.
{¶18} The Court expressed that the right to strip mine and the right to
subjacent support for the surface cannot co-exist. Id. at 248. The Court stated that a
waiver of subjacent support is a prerequisite to finding a right to strip mine, but even
such a waiver is not per se conclusive of the right to strip mine. Id. Strip mining
“necessarily and unavoidably causes total disruption of the surface estate.” Id. at
248-249.
{¶19} Notably, unless contrary language is used, a mineral estate carries with
it the right to use as much of the surface as may be “reasonably necessary to reach
and remove the minerals.” Id. at 249, fn.1, citing 54 American Jurisprudence 2d,
Section 389. Still, this “right to use” does not include the right to destroy it by strip
mining. Id. at 249, fn.1, 251.
{¶20} The Skivolocki Court expressed that the mineral estate has a heavy
burden of showing the right to strip mine and found that the company did not meet its
burden of proof at trial. Id. at 251. The Court noted that the 1901 deed had
language peculiarly applicable to deep mining and evidence showed that strip mining
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was not used in that county until 1917. Id. at 251. The Court found that the $50 per
acre charge for use of the surface did not provide a right to strip mine because
reasonable use of the surface is already a right incident to mining and such right
does not include the right to destroy the surface. Id. The Court concluded that strip
mining was not permissible under the language of that deed.
{¶21} The most recent case cited by the parties is an expansion and
clarification of Skivolocki. See Graham v. Drydock Coal Co., 76 Ohio St.3d 311,
syllabus, 667 N.E.2d 949 (1996). The deed in Graham, drafted years after strip
mining became prevalent, granted “all” mineral rights, the right to enter in, on, and
under the land for testing, mining, and removing minerals, the right to occupy that
portion of the surface necessary for shafts, slopes, and tanks, and the right to use up
to so many acres of the surface for a mine plant. The deed also provided damages
for destruction of crops and fencing.
{¶22} The Graham Court held that the language, “all mineral rights” is
insufficient to grant or reserve the right to strip mine. Id. at 316. The Court
expressed that the deed’s provision for damages to crops and fences and its mention
of the use of the surface for roads or buildings would be unnecessary if the deed
reserved the right to remove the entire surface by strip mining. Id. at 316-317. The
Court pointed out a “patent incompatibility” of strip mining with separate ownership of
the surface of the land. Id. at 317. The Court thus upheld the trial court’s grant of
summary judgment holding that there was no right to strip mine provided in the deed
as a matter of law. In doing so, the Court concluded:
{¶23} “A deed which severs a mineral estate from a surface estate, and which
grants or reserves the right to use the surface incident to mining coal, in language
peculiarly applicable to deep-mining techniques, whether drafted before or after the
advent of strip mining, does not grant or reserve to the mineral owner the right to
remove coal by strip-mining methods.” Id. at syllabus.
{¶24} The Graham Court characterized this as a clear rule to be applied prior
to any determination of whether a deed reservation is ambiguous. See id. at 318 (“In
view of our holding it is unnecessary to determine whether the contract at issue is
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ambiguous so that consideration of extrinsic evidence would be appropriate”), 319
(noting that this “clear rule” announced would avoid the need for deed interpretation
in cases with similar language).
{¶25} Although Graham is not directly on point as the language of that deed
referred to certain deep mining features, its rationale and holdings are instructive
here. First, the fact that the deed was drafted in 1944, after strip mining was utilized
in the county, does not impose a presumption that strip mining was intended. Id. at
316. Second, the reservation of “all mineral rights” in the deed still does not grant
appellants the right to remove those minerals by strip mining. Id. at 316. Moreover,
we are still to be guided by the Burgner precedent that a holder of mineral rights
cannot destroy the surface unless a waiver of the right to an intact surface is
expressed in the deed. Id. at 315, citing Burgner v. Humphrey, 41 Ohio St. 340(1884).
{¶26} The grant of mineral rights with “reasonable surface right privileges”
does not “clearly authorize” strip mining. See Burgner, 41 Ohio St. at 354. It does
not “clearly import” a release of the right to surface support. See Ohio Colliers Co.,
107 Ohio St. at syllabus.
{¶27} In fact, the language stating that “reasonable surface right privileges”
are included in the reservation of mineral rights is a clear indication that strip mining
was not contemplated, and itself is language commonly associated with deep mining.
That is, an owner of mineral rights has the implied right to use as much of the surface
as it reasonably necessary to reach and remove the minerals. Quarto Mining Co. v.
Litman, 42 Ohio St.2d 73, 83, 326 N.E.2d 676 (1975), citing Skivolocki, 38 Ohio St.2d
at 377, citing 54 Am. Jur.2d 389, Mines and Minerals, Section 210.
{¶28} Thus, “reasonable surface right privileges” are not just associated with
a grant of deep mining; they are automatic rights. See id. See also Belville Mining
Co. v. United States, 999 F.2d 989,994 (6th Cir.1993) (using a clause granting “only
so much of the surface as is reasonable necessary” for mining as an example of
language “peculiarly applicable to deep mining”). The deed in question granted
reasonable privileges to use the surface; (notably, in the same clause granting
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ingress and egress). Strip mining is the total destruction of the surface rather the
exercise of the “right to use” the surface incidental to mining, even if strip mining is
the only practicable method of removing the coal. And, case law provides the right to
use as much of the surface as is reasonable to reach and remove the materials does
not include the right to strip mine. Quarto Mining, 42 Ohio St.2d at 83; Skivolocki, 38
Ohio St.2d at 251 (“the right to ‘use’ the surface cannot be reasonably construed as
the right to destroy it”).
{¶29} “To construe the ‘right to use’ as including the right to strip mine would
be to pervert the based purpose of a principles designed to mutually accommodate
the owner of the mineral estate and the owner of the surface estate in the enjoyment
of their separate properties.” Skivolocki, 38 Ohio St.2d at 249, fn.1. With these
special principles in mind, no reasonable person could find that a grantor’s
reservation of mineral rights including ingress, egress, and “reasonable surface right
privileges” clearly imports the right to strip mine.
{¶30} In conclusion, strip mining “necessarily and unavoidably causes a total
disruption of the surface estate.” Id. at 248-249. It inevitably causes surface
“violence, destruction, and disfiguration.” Graham, 76 Ohio St.3d at 318 (comparing
the surface during strip mining to a “battleground”). Strip mining is clearly more than
the exercise of a “reasonable surface right privilege.” The surface right privilege
exercised must be reasonable at each point that it is exercised. Appellants’ desire to
exercise more than reasonable surface right privileges on only part of the property
does not get around the fact that strip mining was not clearly reserved and that strip
mining is a total disruption and elimination of that surface that is strip mined. That the
law requires reclamation thereafter does not diminish the fact that the original surface
is gone and the fact that the existence of any surface is eliminated for a considerable
time. See Graham, 76 Ohio St.3d 311 (where the 1996 Court did not analyze the fact
that reclamation would eventually take place). See also Belville Mining, 999 F.2d at
994 (regulations requiring ultimate restoration of surface do not diminish force of case
law regarding the surface violence of strip mining).
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{¶31} The law states that strip mining is not a reasonable use of the surface
as an incident to mining as strip mining is more than a “use”. Thus, although the
word “reasonable” can be a question of fact in some situations, it is a question of law
in this case. See Castle Props. v. Lowe’s Home Ctrs., Inc., 7th Dist. No. 98CA185
(Mar. 20, 2000) (summary judgment permissible on whether Lowe’s used “all
commercially reasonable efforts”).
{¶32} There is no positive indication that the right to strip mine was intended.
In fact, the language shows that strip mining was not anticipated. We therefore
uphold the trial court’s decision granting summary judgment to the State based upon
the plain language of the deed in conjunction with the special rules set forth in the
strip mining precedent. Consequently, appellant’s arguments on construing
ambiguities, extrinsic evidence, and hearsay are overruled as moot.
FAILURE TO EXPRESSLY DECLARE RIGHTS & FAILURE
TO ALLOW AUGER MINING
{¶33} Appellants complain that the trial court granted summary judgment and
dismissed the complaint with prejudice but did not actually declare the parties’
respective rights as required in resolving a declaratory judgment action. They ask
this court to remand for a clear declaration of rights.
{¶34} In doing so, they ask that (even if we find strip mining to be prohibited)
we order the trial court to permit auger mining because the trial court’s rationale all
deals with strip mining, but auger mining does not destroy the surface above the
mined area as it drills laterally into a hillside. However, strip mining is statutorily
defined as including auger coal mining. R.C. 1513.01(S). See also Skivolocki, 38
Ohio St.2d at 247 (citing a case treating strip and auger mining the same). In any
event, appellants admitted that they would need to strip mine an area of a hillside in
order to auger mine into the hill, and they only sought the right to auger mine in the
strip mined area. See Complaint at ¶ 13, 10, 17 (“surface mining and auger mining in
a surface mining area”). As such, the same test would apply to both types of mining,
and this argument is without merit.
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{¶35} As for the form of the court’s entry, the declaratory judgment statute
provides that a person interested under a deed may have determined any question of
construction or validity arising under the instrument and obtain a declaration of rights,
status, or other legal relations under it. R.C. 2721.03. A plaintiff is entitled to a
declaration of rights, rather than a dismissal, unless there is no real controversy
between the parties or a declaratory judgment will not terminate the controversy.
Weyandt v. Davis, 112 Ohio App.3d 717, 721, 678 N.E.2d 1191 (9th Dist.1996)
(where court granted a motion to dismiss the action). Still, the court’s form of entry is
harmless if the court did in fact end up declaring the respective rights in its order. Id.
at 721-722.
{¶36} A trial court should expressly declare the parties’ rights in disposing of a
declaratory judgment action. Nickschinski v. Sentry Ins. Co., 88 Ohio App.3d 185,
189, 623 N.E.2d 660 (8th Dist.1993), citing Waldeck v. N. College Hill, 24 Ohio
App.3d 189, 190, 24 OBR 280, 493 N.E.2d 1375 (1st Dist.1985) (a trial court does
not fulfill its function in a declaratory judgment action when it disposes of the issues
by journalizing an entry merely sustaining or overruling a motion for summary
judgment without setting forth any construction of the document under consideration).
In fact, it has been stated that the order granting summary judgment in declaratory
relief action is not final if it does not declare rights. See, e.g., Caplinger v. Raines,
4th Dist. No. 02CA2683, 2003-Ohio-2586, ¶ 3; Haberley v. Nationwide Mut. Fire Ins.
Co., 142 Ohio App.3d 312, 314, 755 N.E.2d 455 (8th Dist.2001). See also R.C.
2721.02(A) (declaration may be affirmative or negative; declaration has the effect of a
final judgment).
{¶37} The final judgment entry here contains no real declaration of rights as it
merely stated that the State’s motion for summary judgment was sustained and thus
the case was dismissed with prejudice. However, in this case, we also have the trial
court’s opinion released prior to the final entry. This opinion did not merely grant
summary judgment for the State and thus dismiss the complaint with prejudice. It
also contained the issues presented, the parties’ arguments, the court’s interpretation
of the law, and the court’s analysis.
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{¶38} Specifically, the trial court quoted the pertinent portion of the deed and
framed the issue as whether the quoted reservation encompassed the right to strip
mine. The court concluded that the mere reservation of mineral rights did not imply
the right to remove the minerals by strip mining methods. Instead, in order for the
grantor to reserve the right to strip mine, he must have expressly reserved that
particular right. The court found that although what is a “reasonable” use of the
surface could be ambiguous in some situations, when the question is whether strip
mining is a reasonable surface privilege incident to mining, the phrase is not
ambiguous, explaining how case law characterizes strip mining as the destruction of
the surface not merely as the use of the surface. The trial court then concluded that
appellants could not use extrinsic evidence as such evidence cannot be viewed when
there is no ambiguity.
{¶39} Considering all of this combined with the grant of summary judgment in
favor of the State and the dismissal of appellants’ request for declaratory relief, the
trial court effectively declared that appellants have no right to strip mine the land.
Thus, although a clearer declaratory conclusion could have been drafted, any issue
with the form of the declaration is harmless.
{¶40} For the foregoing reasons, the judgment of the trial court is hereby
affirmed.
Waite, P.J., concurs.
DeGenaro, J., concurs.