Swartz v. Householder

[Cite as Swartz v. Householder, 2014-Ohio-2359.]
STATE OF OHIO, JEFFERSON COUNTY
IN THE COURT OF APPEALS
SEVENTH DISTRICT
DAN SWARTZ, et al., )
) CASE NO. 13 JE 24
PLAINTIFFS-APPELLEES, )
)
VS. ) OPINION
)
JAY HOUSEHOLDER, SR., et al., )
)
DEFENDANTS-APPELLANTS. )
ERNEST SHANNON, et al., )
) CASE NO. 13 JE 25
PLAINTIFFS-APPELLEES, )
)
VS. ) OPINION
)
JAY HOUSEHOLDER, SR., et al., )
)
DEFENDANTS-APPELLANTS. )
CHARACTER OF PROCEEDINGS: Civil Appeal from Common Pleas Court,
Case Nos. 12CV328 (24); 12CV226 (25).
JUDGMENT: Affirmed.
APPEARANCES:
For Plaintiffs-Appellees: Attorney Steven Shrock
Attorney Clinton Bailey
138 East Jackson Street
Millersburg, Ohio 44654
For Defendants-Appellants: Attorney Brandon Cogswell
Attorney Robert Guehl
7925 Paragon Road
Dayton, Ohio 45459
JUDGES:
Hon. Joseph J. Vukovich
Hon. Gene Donofrio
Hon. Cheryl L. Waite
-2-
Dated: June 2, 2014
[Cite as Swartz v. Householder, 2014-Ohio-2359.]
VUKOVICH, J.
{¶1} The Householder appellants appeal two decisions from the Jefferson
County Common Pleas Court granting summary judgment to the Shannon family and
the Swartz family and thus finding the Householders’ mineral interests had been
abandoned. The main issue for our review is whether the 1989 Dormant Mineral Act
(DMA) can still be utilized by surface owners with rights deemed vested under that
statute or whether the 2006 amendments apply retroactively. We conclude that the
1989 DMA was self-executing and can still be relied upon. For the following reasons,
the judgments of the trial court are affirmed.
STATEMENT OF THE SHANNON CASE
{¶2} Ernest and Shelda Shannon own 118 acres in Jefferson County. In
seeking to reunite the minerals with the surface of their property, they published
notice of their intent and then recorded a 2011 affidavit of abandonment. Jay
Householder, Sr. recorded a claim to preserve as heir to the 1946 original property
owners: Elva Lawrence, Alma Lawrence, Chelissa Swickard, and Jetta Householder.
The latter two owners sold their shares to the Lawrence sisters in the 1950’s, but
their mineral rights were severed and reserved. It is those reserved mineral rights
that are at issue here as the Lawrences’ mineral rights were found to have been sold
to the Shannons along with the surface (and that finding was not appealed).
{¶3} In 2012, the Shannons filed a complaint for a declaratory judgment and
quiet title against the Householder appellants, seeking a declaration that the mineral
interests under their property had been abandoned under the 1989 and 2006
Dormant Mineral Acts. The defendants counterclaimed for declaratory judgment and
quiet title. A stipulation of facts was filed.
{¶4} The Shannons filed a motion for summary judgment, arguing in
pertinent part that the defendants’ mineral interest rights were extinguished by the
self-executing 1989 DMA due to the lack of savings events. The Householder
appellants responded that the 2006 DMA was to be applied retrospectively (and was
remedial) and thus the 2006 amendments apply to cases filed after those
amendments. The Shannons countered that the 2006 DMA does not apply
-2-
retroactively as it does not expressly so provide, and thus it does not undo what the
1989 DMA already provided by its automatic operation. They also noted that any
attempt at retroactivity would have been unconstitutional as the 1989 DMA provided
a substantive right.
{¶5} On July 17, 2013, the trial court granted summary judgment in favor of
the Shannons. The court stated that the 1989 DMA was self-executing and the 2006
DMA was not expressly made retroactive as required by R.C. 1.48 and thus it was
only to be applied prospectively. In applying the 1989 DMA, the court found no
savings events and concluded that contested mineral interest had been abandoned.
The Householders filed a timely notice of appeal, resulting in 13JE25.
STATEMENT OF THE SWARTZ CASE
{¶6} Dan and Donna Swartz own 72 acres in Jefferson County. The mineral
interests for this property were originally severed in 1946 when the surface was sold
by the same four original property owners as in the Shannon case. The Swartzes
published notice of intent to declare the mineral interest abandoned in 2011, and Mr.
Householder filed a claim to preserve. The Swartzes then filed a complaint for
declaratory judgment, asserting that the mineral interest had been abandoned under
the 1989 and 2006 Dormant Mineral Acts. Appellants counterclaimed for declaratory
judgment and quiet title. A stipulation of facts was filed.
{¶7} A motion for summary judgment was filed by the Swartz family. In
pertinent part, they argued automatic abandonment under the self-executing 1989
DMA. The Householders responded that the 2006 amendment was intended to be
retroactive (and that said retroactivity is valid because the statute is remedial). They
urged that any automatic abandonment under the 1989 DMA can no longer be
declared. The Swartz family countered that the 2006 DMA does not expressly
provide for retroactivity and thus does not undo the vested right that the 1989 DMA
already provided by its automatic operation, noting that the legislature did not so
provide because such a retroactive application would have been unconstitutional as
the law provided a substantive right to the surface owner.
-3-
{¶8} On July 17, 2013, the trial court granted summary judgment in favor of
the Swartzes, finding no savings events under the 1989 DMA. As in Shannon, the
court stated that the 1989 DMA was self-executing upon the lack of a savings event.
The Householders filed a timely notice of appeal, resulting in 13JE24.
ASSIGNMENT OF ERROR
{¶9} The Householders’ two appeals were consolidated by this court. The
Householders’ sole assignment of error alleges:
{¶10} “The trial court erred in granting the Shannon Plaintiffs’ and the Swartz
Plaintiffs’ Motion for Summary Judgment because it incorrectly applied the 1989
Dormant Mineral Act instead of the 2006 Dormant Mineral Act in holding that the
Defendants[‘] mineral interest was automatically abandoned.”
{¶11} This assignment has three main arguments, which we have divided into
three categories: continued application of the 1989 DMA; constitutionality of the
1989 DMA; and factual application of the 2006 DMA. With the exception of the final
category, appellant’s arguments on appeal involve across-the-board legal questions
that do not rely on the particular facts of this case. Before delving into the
arguments, we outline the Dormant Mineral Acts.
DORMANT MINERAL ACTS
{¶12} The 1989 Dormant Mineral Act became effective on March 22, 1989 in
R.C. 5301.56 as an addition to the Ohio Marketable Title Act, which is contained
within R.C. 5301.47 through R.C. 5301.56. The 1989 DMA provides that a mineral
interest held by one other than the surface owner “shall be deemed abandoned and
vested in the owner of the surface” if no savings event occurred within the preceding
twenty years. R.C. 5301.56(B)(1)(c) (unless the mineral interest is (a) in coal or (b)
held by the government). The six savings events are as follows: (i) the mineral
interest was the subject of a title transaction that has been filed or recorded in the
recorder’s office, (ii) there was actual production or withdrawal by the holder, (iii) the
holder used the mineral interest for underground gas storage; (iv) a mining permit
has been issued to the holder; (v) a claim to preserve the mineral interest was filed;
-4-
or (vi) a separately listed tax parcel number was created. R.C. 5301.56(B)(1)(c)(i)-
(vi).
{¶13} The statute provided the following grace period: “A mineral interest
shall not be deemed abandoned under division (B)(1) of this section because none of
the circumstances described in that division apply, until three years from the effective
date of this section.” R.C. 5301.56(B)(2). There were no obligations placed upon the
surface owner prior to the statutory abandonment and vesting.
{¶14} On June 30, 2006, amendments to the DMA became effective. The
three year grace period in (B)(2) was eliminated. And now, the language in division
(B), “shall be deemed abandoned and vested in the owner of the surface,” operates
only if none of the savings events apply and “if the requirements established in
division (E) of this section are satisfied.” R.C. 5301.56(B).
{¶15} Now, “Before a mineral interest becomes vested under division (B) of
this section in the owner of the surface of the lands subject to the interest, the owner
of the surface of the lands subject to the interest shall do both of the following:” (1)
provide a specific notice; and (2) file a timely affidavit of abandonment with the
county recorder. R.C. 5301.56(E). See R.C. 5301.56(E)(1) (notice by certified mail
return receipt requested to each holder or each holder’s successors or assignees, at
the last known address, but if service of notice cannot be completed to any holder,
then notice by publication), (E)(2) (affidavit of abandonment must be filed at least 30
but not later than 60 days after the date on which the notice is served or published),
(F), (G) (specifying what the notice and affidavit must contain).
{¶16} The 2006 DMA also adds that a mineral holder who claims an interest
has not been abandoned may file with the recorder: (a) a claim to preserve or (b) an
affidavit containing a savings event within 60 days after the notice of abandonment is
served or published. R.C. 5301.56(H)(1). If no such timely document is recorded,
then the surface owner “who is seeking to have the interest deemed abandoned and
vested in the owner” shall file with the recorder a notice of the failure to file. R.C.
5301.56(H)(2) (was called memorialization; changed to “notice of failure to file” on
-5-
January 31, 2014). “Immediately after” such recording, “the mineral interest shall
vest in the owner of the surface * * *.” Id.
CONTINUED APPLICATION OF 1989 DMA
{¶17} Appellants set forth various arguments in support of their allegation that
the 1989 DMA is not applicable due to the enactment of the 2006 DMA. First,
appellants note that our Dodd case did not discuss the 1989 DMA. However, the
parties in that case did not present arguments to this court under the 1989 DMA.
See Dodd v. Croskey, 7th Dist. No. 12HA6, 2013-Ohio-4257. They only presented
arguments concerning the 2006 DMA. If parties do not invoke a statute, we proceed
under the impression that the parties agreed that said statute was not dispositive, i.e.
if parties agree that there was no abandonment under the 1989 DMA, then they
proceed under only the 2006 DMA. Thus, the lack of reference to the 1989 DMA in
Dodd is not dispositive as to whether the 1989 DMA can still be used to assert vested
rights.
{¶18} Appellants also briefly posit that the 1989 DMA conflicts with the Ohio
Marketable Title Act, noting that the MTA has a 40 year period, deals with the chain
of title, and instructs at R.C. 5301.55 that it “shall be liberally construed to effect the
legislative purpose of simplifying and facilitating land title transactions by allowing
persons to rely on a record chain of title.” See also R.C. 5301.49(A). Appellants
essentially urge that the 1989 DMA should be ignored because allowing a mineral
interest to be lost without a savings event during the applicable twenty-year period
does not respect the purpose of the MTA.
{¶19} Appellees respond that the DMA is a specific addition to the OMTA with
a clear legislative intent to have stale, unused mineral interests deemed abandoned,
explaining that it does assist in facilitating land transaction by extinguishing old
claims. The DMA is part of the MTA, with the 1989 DMA being added as R.C.
5301.56. The provision cited by appellants in R.C. 5301.55, regarding liberally
construing the MTA to facilitate land transactions expressly speaks of the
construction of R.C. 5301.47 through R.C. 5301.56, inclusive. As aforementioned,
that last statute mentioned, R.C. 5301.56, is the DMA.
-6-
{¶20} Appellants do not sufficiently explain why the specific and later
language of the DMA would not apply over the general language of the MTA and do
not discuss R.C. 1.51. Pursuant to R.C. 1.51, if a general provision conflicts with a
special provision, they shall be construed if possible by giving effect to both, and if
the conflict is irreconcilable, the special prevails as an exception to the general
provision, unless the general provision is the later adoption and the manifest intent is
that the general provision prevail. See also Summerville v. Forest Park, 128 Ohio
St.3d 221, 2010-Ohio-6280, 943 N.E.2d 522, ¶ 26-33. Here, the DMA is more
specific, it was enacted later, and the legislative intent is clearly to reattach mineral
interests back to the surface under a twenty-year look back.
{¶21} Moreover, on the topic of whether the 1989 DMA could be utilized,
appellants argued to the trial court that the 2006 DMA was retroactive (and remedial).
They did not mention any conflict with the MTA. Thus, we need not further review
this argument for the first time on appeal. See, e.g, Litva v. Richmond, 172 Ohio
App.3d 349, 2007-Ohio-3499, 874 N.E.2d 1243, ¶ 18 (7th Dist.).
{¶22} Appellants also briefly urge that the 1989 DMA was invalid due to the
lack of specific implementation provisions; in other words, it attempted to create a
right but forgot to provide a remedy. However, clearly a court action, such as a
declaratory judgment or quiet title action to formalize the statutory vesting, already
legally existed as a matter of course, i.e. a statute need not explain to the reader how
they can file a court action to have their rights declared. In any event, appellants did
not make this claim below and thus waived the argument for purposes of appeal.
See id.
{¶23} Next, appellants propose that in order to use the 1989 DMA, the
surface owners must have implemented the act prior to the 2006 amendments, such
as by recording an affidavit of abandonment or filing a court proceeding for quiet title.
Appellants conclude that because there were no specific statutory steps provided in
order to implement the rights granted by the 1989 DMA, then surface owners who
waited to formalize their rights are bound by the 2006 DMA, citing Dahlgren v. Brown
Farm Props., LLC, Carroll C.P. No. 13CV27 (Nov. 5, 2013 J.E.) (holding that 1989
-7-
DMA created inchoate right and the failure to seek judicial confirmation or record a
cloud that the mineral holder could contest prior to the 2006 amendments destroyed
right to assert that the mineral interest vested in the surface owner automatically).
Appellants conclude that the 2006 DMA is the only remedy left, thus basically
continuing their argument from below that the 2006 DMA applies retroactive. Again,
the position appellants espoused below regarding which act to apply was that the
2006 amendments apply retrospectively (and that this was permissible because it
only affected remedial as opposed to substantive rights1).
{¶24} Appellees respond that the mineral interest here was deemed
abandoned and vested in the surface owner under the self-executing 1989 DMA long
before the 2006 DMA was enacted and that the 2006 did not undo prior
abandonments. Appellees point to the United States Supreme Court’s holding in
Texaco, which emphasized the difference between the self-executing feature of a
dormant mineral act and subsequent judicial determination that a lapse did in fact
occur. See Texaco v. Short, 454 U.S. 516, 102 S. Ct. 781, 70 L. Ed. 2d 738 (1982).
Appellees disagree with the holding of the trial court in Dahlgren, urging that said
court added language to the act by holding that the 1989 DMA “impliedly required
implementation” by court proceeding or at least by a recorded affidavit of
abandonment in order to turn what the court termed an “inchoate” right into a vested
right. Appellees emphasize that the obligation to act was on the mineral interest
holder in order to avoid automatic abandonment and vesting and there was no
obligation imposed upon the surface owner under the 1989 DMA. Appellees insist
that the requirements of the 2006 DMA only apply prospectively to new
abandonments as it was not expressly made retrospective (and suggest the
1
The latter argument was apparently made in contemplation of a contention that retrospective
application of the 2006 DMA would be unconstitutional as the test for determining an unconstitutionally
retroactive law involves a determination of whether it is in fact retrospective and then whether it affects
merely remedial as opposed to substantive rights. See Ohio Constitution, Article II, Section 28 (“The
General Assembly shall have no power to pass retroactive laws * * *.”). See also Bartol v. Eckert, 50
Ohio St.31, 33 N.E. 294 (1893) (if there is an expression of retrospective intent in the statute, it will be
considered constitutional only if it affects merely remedial, as opposed to substantive, rights).
However, if a law applies only prospectively, there is no second step. State v. Ferguson, 120 Ohio
St.3d 7, 2008-Ohio-4824, 896 N.E.2d 110, ¶ 14.
-8-
legislature did not make it retrospective as said application would have affected
substantive as opposed to remedial rights.)
{¶25} Pursuant to the 1989 DMA, a mineral interest held by a person other
than the surface owner of the land subject to the interest “shall be deemed
abandoned and vested in the owner of the surface” if no savings event occurred
within the preceding twenty years. Former R.C. 5301.56(B)(1)(c) (unless the mineral
interest is (a) in coal or (b) held by the government). See also Former R.C.
5301.56(B)(2) (a mineral interest shall not be “deemed abandoned” due to lack of
savings events until three years from the March 22, 1989 effective date of the act).
{¶26} By way of comparison, the 2006 DMA provides that the mineral interest
will not become vested until the surface owner serves or publishes (if applicable) the
notice of abandonment on each holder and then at least, thirty but not more than
sixty days thereafter, records an affidavit of abandonment. R.C. 5301.56(E)(1)-(2). If
the mineral holder fails to respond with one or two timely documents, the surface
owner shall cause a memorialization of the abandonment to be recorded at which
time the mineral interest shall vest in the surface owner. R.C. 5301.56(H)(2).
{¶27} The 1989 DMA is the type of statute characterized by automatic lapsing
and reversion to the surface owner known as a self-executing statute. See Texaco,
454 U.S. 516. The United States Supreme Court stated that Indiana’s DMA was self-
executing as it provided the mineral interest shall be extinguished and the ownership
shall revest upon the non-occurrence of savings events within the pertinent time
period. Id. (and stating that notice to avoid automatic abandonment besides the
statutory two-year grace period was not required and the only required notice
involved the ability to prove a savings event in fact occurred in the pertinent period).
{¶28} In our recent Walker case, the appellant presented arguments to this
court paralleling those outlined above regarding the inability to continue to apply the
1989 DMA. We concluded that the 1989 DMA can still be used after the 2006 DMA
amendments because the prior statute was self-executing and the lapsed right
automatically vested in the surface owner. See Walker v. Shondrick-Nau, Executrix
-9-
of Estate of Noon, 7th Dist. No. 13NO402, 2014-Ohio-1499 (fka Walker v. Noon).
We maintain that holding and reiterate the rationale here.
{¶29} A vested interest can be a property right created by statute; it so
completely and definitely belongs to a person that it cannot be impaired or taken
away without the person’s consent. See id. at ¶ 40, quoting State ex rel. Jordan v.
Industrial Comm., 120 Ohio St. 3d 412, 2008-Ohio-6137, 900 N.E.2d 150, ¶ 9. Again,
the 1989 DMA, with its three-year grace period, specifies that the mineral interest is
deemed abandoned and the surface owner obtains a vested right if any of the listed
circumstances apply, none of which are disputed on appeal here. See Former R.C.
5301.56(B)(1).
{¶30} Pursuant to R.C. 1.58(A), the reenactment, amendment, or repeal of a
statute does not affect the prior operation of the statute or any prior action taken
thereunder. R.C. 1.58(A)(1). In addition, the reenactment, amendment, or repeal of
a statute does not affect any validation, cure, right, privilege, obligation, or liability
previously acquired, accrued, accorded, or incurred thereunder. R.C. 1.58(A)(2).
Plus, the reenactment, amendment, or repeal of a statute does not affect any
proceeding or remedy in respect of any such privilege, obligation, or liability and the
proceeding or remedy may be instituted, continued, or enforced as if the statute had
not been repealed or amended. R.C. 1.58(A)(4).
{¶31} Furthermore, “[a] statute is presumed prospective in its application
unless expressly made retrospective.” R.C. 1.48. See also State ex rel. Cincinnati
Enquirer v. Jones-Kelley, 118 Ohio St. 3d 81, 2008-Ohio-1770, 886 N.E.2d 206, fn. 2
(not retroactive because legislature did not specify that statute applied retrospectively
and no indication that law was clarification as opposed to modification); Bartol v.
Eckert, 50 Ohio St.31, 33 N.E. 294 (1893); Walker, 7th Dist. No. 13NO402 at ¶ 36. In
accordance, a statute must “specifically indicate” that it applies retroactively or it will
be implemented as applying only prospectively. State v. Ferguson, 120 Ohio St. 3d 7,
2008-Ohio-4824, 896 N.E.2d 110, ¶ 15 (to overcome the presumption that it applies
only prospectively, the legislature must “clearly proclaim” the retroactive application).
See also Doe v. Archdiocese of Cincinnati, 109 Ohio St. 3d 491, 2006-Ohio-2625,
-10-
849 N.E.2d 268, ¶ 40 (if a statute is silent on intent to apply retrospectively, then it
applies only prospectively).
{¶32} This means that the statute to be applied is the one existing at the time
the cause of action accrued unless the new statute existing at the time the suit was
filed enunciates that it applies to causes of action that accrued prior to the effective
date. See, e.g., id.; Groch v. Gen. Motors Corp., 117 Ohio St. 3d 192, 2008-Ohio-
546, 883 N.E.2d 377, ¶ 179, 183 (where new statute clearly said that it applied to
suits filed after its effective date, it had retroactive application to injuries that occurred
prior to enactment). See also Walker, 7th Dist. No. 13NO402 at ¶45-50, reviewing
Cadles of Grassy Meadows, II, LLC v. Kistner, 6th Dist. No. L-09-1267, 2010-Ohio-
2251.
{¶33} Comparably, the Sixth District has concluded that a new statute of
limitations for revivor of judgments (shortening time for such action) did not apply to
judgments that became dormant prior to enactment where that new statute of
limitations contained no clear expression of retrospective application. Kistner, 6th
Dist. No. L-09-1267 at ¶ 17. That court concluded that the new statute of limitations
for reviving dormant judgments does not apply to dormant judgments that existed
prior to the effective date of the amendment, even though the statute was enacted
before the revival action was filed. Id.
{¶34} The theory is thus: when the 2006 version was enacted, any mineral
interest that was abandoned under the 1989 version stayed abandoned and
continued to be vested in the surface owner, and once the mineral interest vested in
the surface owner, it reunited with the surface estate pursuant to statute regardless of
whether the event has yet to be formalized. See Walker, 7th Dist. No. 13NO402 at ¶
41. Additionally, the 2006 DMA contains no language eliminating property rights that
were previously expressly said to be vested, i.e. it contains no statement that its new
requirements for surface owners and the new rights for mineral holders apply
retrospectively.2 See id. at ¶ 51. Without express language eliminating the prior
2
Although not argued, we note that a look-back period (which already existed under the old
statute) does not implicitly make a statute retroactive. The notice of abandonment is the new trigger
-11-
automatic abandonment and vesting of rights under the old act, the amendments do
not affect causes already existing (regardless of whether a suit is filed before or after
the amendments). See id.
{¶35} In fact, by stating, “Before a mineral interest becomes vested under
division (B) of this section in the owner of the surface of the lands subject to the
interest, the owner of the surface subject to the interest shall do both of the following
* * *,” the 2006 language shows that it deals with rights that are not yet vested (that is
to say, mineral interests that have not yet been deemed abandoned). See R.C.
5301.56(E). The current DMA thus eliminated the automatic vesting after June 30,
2006, but did not erase previously vested interests (merely because a suit had not
yet been filed to formalize the reverter).
{¶36} To some, the result reached by the trial court in Dahlgren may seem
fair, equitable, and practical under a theory that it is the initial forfeiture that should be
abhorred by the law rather than the later forfeiture of a property right obtained by
forfeiture in the first place. However, legislatures around the country found such
initial abandonment and unification with the surface to be important to the state, and
the United States Supreme Court agreed that the state has such legitimate interests.
{¶37} It is as if Dahlgren construed the amendments to be a type of implied
statute of limitations for asserting rights granted under the 1989 DMA. Essentially,
Dahlgren found that a vested right was eliminated by a non-retrospective statutory
amendment (an amendment with no grace period unlike the 1989 DMA). Dahlgren
concluded that the lack of savings events at most created an inchoate right because
judicial action would be required in order to officially transfer ownership on the
records (or a recording of a disputed title so the mineral owner could contest the
dispute).
{¶38} Yet, the terms “inchoate” and “vested” are generally opposites. See,
e.g., Bauman v. Hogue, 160 Ohio St. 296, 301, 116 N.E.2d 439 (1953); Walker, 7th
for the look-back, which item can only apply prospectively because one could not file a notice of
abandonment with the 2006 DMA statutory effects before it was even created. In other words, the
new DMA instituted a new look-back initiator (the notice of abandonment) to be employed
prospectively in the future.
-12-
Dist. No. 13NO402 at ¶ 43. An inchoate right is a right that has not fully developed,
matured, or vested. Black’s Law Dictionary (9th Ed.2009) (online). We conclude that
it is contrary to the plain language of the statute to hold that the surface owner’s right
to the abandoned mineral interests are inchoate even though the statute expressly
stated that the right vested upon the lack of a savings event within the pertinent time
period. Finally, we note that Dahlgren expressed concern about the opportunity to
contest abandonment without recognizing that the very suit before it was the
opportunity to so contest (that there were savings events in the pertinent time period).
{¶39} As we held in Walker, the 1989 DMA can still be utilized for mineral
interests that were deemed vested thereunder (and the current version could be used
in the alternative for later acts of abandonment if the mineral holder demonstrated
that there were savings events under the 1989 DMA). Thus, the trial court did not err
in utilizing the 1989 DMA.
CONSTITUTIONALITY
{¶40} Appellants assert that the 1989 DMA imposes forfeiture without due
process and violates Ohio Constitution, Article I, Section 19, which provides: “Private
property shall ever be held inviolate.” They recognize the significance of the United
States Supreme Court’s Texaco holding but refer to the discussion of the importance
of notice therein and the statements of the dissent in that case. Appellants conclude
by noting that a state court can find a statute unconstitutional under the state
constitution even if it is constitutional under the federal constitution.
{¶41} In Texaco, the Supreme Court held that Indiana’s DMA was not
unconstitutional as a state may treat as abandoned a mineral interest that has not
been used for twenty years and for which no statement of claim has been filed, and
thus, a mineral holder can validly lose his interest without advance notice from the
surface owner. Texaco, 454 U.S. 516 (no unconstitutional taking, no due process
violation, and no impairment of contract). The Court noted that a state surely has the
power to condition the ownership of mineral rights on compliance with conditions in
the DMA that impose such a slight burden on the owner while providing such clear
and legitimate benefits to the state. Id. at 529-530. It was said to be the mineral
-13-
holder’s failure to make use of the minerals or otherwise follow the statutory
preservation option before the twenty-year period or the end of the two-year grace
period, rather than the state’s action, that caused the lapse of the property right. Id.
at 529-531 (requirement that owner of mineral interest unused for 20 years must
come forward and file a current statement of claim is not a taking).
{¶42} The Indiana DMA’s two year grace period foreclosed any argument that
the statute was invalid because mineral owners may not have had an opportunity to
become familiar with the requirements. Id. at 532. (“It is well established that
persons owning property within a State are charged with knowledge of relevant
statutory provisions affecting the control or disposition of such property.”). The Court
also explained that the holders have no constitutional right to receive individual notice
that their rights will expire, and the only notice required was that prior to formal
deprivation where the holder could attempt to prove that there was in fact a prior
savings event. Id. at 532-534. Notably, Ohio’s 1989 DMA provided notice of three
years within which the mineral owners could save their interest before any
abandonment would vest.
{¶43} As appellees emphasize, appellants did not raise the constitutionality
of the statute below.3 Thus, the issue has been waived for purposes of appeal. See,
e.g., Abraham v. National City Bank Corp., 50 Ohio St. 3d 175, 176, 553 N.E.2d 619
(1990), fn. 1 (agreeing with appellate court that argument regarding constitutionality
of statute was waived because it was not raised below). See also Danis Clarkco
Landfill Co. v. Clark Cty. Solid Waste Mgt. Dist., 73 Ohio St. 3d 590, 598, 653 N.E.2d
646 (1995). And, we cannot conclude that the trial court committed plain error by
failing to sua sponte consider whether the statute was constitutional. See Walker,
7th Dist. No. 13NO402 at ¶ 57 (refusing to address constitutional argument
3
See Swartz file: Answer & Counterclaim; Defendant’s Motion for Summary Judgment;
Defendant’s Memorandum in Opposition to Plaintiff’s Motion for Summary Judgment at 9-12;
Defendant’s Reply at 4. See also Shannon file: Answer and Counterclaim; Defendant’s Motion for
Summary Judgment; Defendant’s Memorandum in Opposition to Plaintiff’s Motion for Summary
Judgment at 9-12, 14; Defendant’s Reply at 2-3. In fact, Defendant’s Memorandum in Opposition to
Plaintiff’s Motion for Summary Judgment at page 11 in the Shannon case, while arguing that the 2006
-14-
concerning 1989 DMA where it was not raised in summary judgment stage), citing
Goldfuss v. Davidson, 79 Ohio St. 3d 116, 679 N.E.2d 1099 (1997), syllabus (plain
error is recognized in a civil case only in an extremely rare case involving exceptional
circumstances where the unobjected to error seriously affects the basic fairness,
integrity, or public reputation of the judicial process, thereby challenging the
legitimacy of the underlying judicial process itself).
{¶44} Moreover, this is a declaratory judgment action and a declaratory
judgment counterclaim, but appellants did not notify the attorney general of the
constitutional challenge to the 1989 DMA as required in declaratory judgment
actions. R.C. 2721.12 (if any statute * * * is alleged to be unconstitutional, the
attorney general also shall be served with a copy of the complaint in the action or
proceeding and shall be heard.”); Cicco v. Stockmaster, 89 Ohio St. 3d 95, 98-100,
728 N.E.2d 1066 (2000) (reiterating that this requirement is jurisdictional and finding
a problem even where the attorney general was given copy of the summary judgment
motion where constitutionality was first raised); Malloy v. Westlake, 52 Ohio St. 2d
103, 105-107, 370 N.E.2d 457 (1977). Therefore, appellant’s constitutionality
arguments shall not be further addressed by this court.
NOTICE AND CLAIM TO PRESERVE
{¶45} Lastly, appellants briefly raise two arguments under the 2006 DMA,
which they presented in their cross-motions for summary judgment. Appellants
assert that the notice provided by appellees violated the 2006 DMA as there was only
notice by publication and no certified mailing. See R.C. 5301.56(E)(1). Appellants
also state that they filed timely claims to preserve under the 2006 DMA, one timely on
its face and the other timely because of the claimed notice issue. See R.C.
5301.56(H)(1). They point out that a claim to preserve is akin to a savings event
under the 2006 DMA. See Dodd v. Croskey, 7th Dist. No. 12HA6, 2013-Ohio-4257, ¶
17-36.
rather than the 1989 DMA applies, specifically states: “The Texaco case only establishes that Ohio’s
1989 Dormant Mineral Act was constitutional.”
-15-
{¶46} Initially, we point out that these issues were never reached by the trial
court as that court found abandonment under the 1989 DMA, which the trial court
specifically found was determinative when it refused to rule on these matters. Thus,
these issues would not be ripe for our review as they were not reached during the
summary judgment stage below. See, e.g., Bowen v. Kil-Kare, Inc., 63 Ohio St. 3d
84, 88-89, 585 N.E.2d 384, 389-390 (1992), fn. 5 (where the trial court declined to
consider the first argument raised in the motion for summary judgment, but granted
the motion for summary judgment solely on the basis of another argument, the first
argument was not properly before the court of appeals); Crites v. Anthem Life Ins.
Co., 3d Dist. No. 4-12-21, 2013-Ohio-2145, ¶ 8; Farley v. Chamberlain, 4th Dist. No.
03CA48, 2004-Ohio-2771, ¶ 12 (refusal to usurp trial court’s function). See also
Murphy v. Reynoldsburg, 65 Ohio St. 3d 356, 360, 604 N.E.2d 138 (1992) (fact that
appellate court has de novo summary judgment review does not mean that trial court
need not first rule on issues presented in motions).
{¶47} In any event, these 2006 DMA arguments were only presented for our
review if we first concluded that the 1989 DMA was inapplicable. As we have found
that the self-executing 1989 DMA can still be utilized to show abandonment, these
conditional arguments are moot.
{¶48} For the foregoing reasons, the judgments of the trial court are affirmed.
Donofrio, J., concurs.
Waite, J., concurs.