Tribett v. Shepherd

[Cite as Tribett v. Shepherd, 2014-Ohio-4320.]
STATE OF OHIO, BELMONT COUNTY
IN THE COURT OF APPEALS
SEVENTH DISTRICT
VERNON TRIBETT, et al., )
) CASE NO. 13 BE 22
PLAINTIFFS-APPELLEES/ )
CROSS-APPELLANTS, )
)
VS. ) OPINION
)
BARBARA SHEPHERD, et al., )
)
DEFENDANTS-APPELLANTS/ )
CROSS-APPELLEES. )
CHARACTER OF PROCEEDINGS: Civil Appeal from Common Pleas Court,
Case No. 12CV180.
JUDGMENT: Affirmed.
APPEARANCES:
For Plaintiffs-Appellees/ Attorney Richard Myser
Cross-Appellants: 320 Howard Street
Bridgeport, Ohio 43912
For Defendants-Appellants/ Attorney Matthew Warnock
Cross-Appellees: Attorney Daniel Gerken
100 South Third Street
Columbus, Ohio 43215-4291
JUDGES:
Hon. Joseph J. Vukovich
Hon. Gene Donofrio
Hon. Mary DeGenaro
Dated: September 29, 2014
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VUKOVICH, J.
{¶1} Defendants-appellants Barbara Shepherd, Marion Shepherd, as
executor of the Estate of Joseph Shepherd, David Shepherd, Scott Whitacre, Susan
Spenser, Steve Whitacre, Samuel Whitacre, Ralph Earliwine, James Earliwine,
Rhonda Earliwine, Donley Williams, Mary Taylor, Cathy Jo Yontz, Carol Talley, Karen
Stubbs, Pamela Skelly, David Huisman, Debbie Allen, Mark Phillips, Brian Phillips,
Liana Phillips Yoder, Sallie Shepherd, John Mauersberger, George Mauersberger,
Gwen Lewis, Wayne Shepherd, Brent Moser, Barrett Moser and Kaye Anderson Hall
(collectively referred to as Shepherds) appeal the decision of the Belmont County
Common Pleas Court granting summary judgment in part for Vernon Tribett and
Susan Tribett (Tribetts). The Tribetts have cross appealed. They are appealing from
the decision of the Belmont County Common Pleas Court that granted the Shepherds
motion for summary judgment in part.
{¶2} Multiple issues are raised in the appeal and cross appeal, most of which
have recently decided in other decisions by this court. The issues that have not been
decided are whether the 1989 version of Ohio Dormant Mineral Act (ODMA) is barred
by the statute of limitations and whether the 1989 version of the ODMA is
unconstitutional. We find that the 1989 version of the ODMA is not barred by the
statute of limitations and that that version is constitutional. Based on those rulings, our
prior decisions and the reasons expressed below, the judgment of the trial court is
hereby affirmed.
Statement of the Facts and Case
{¶3} In 1959, Joseph Shepherd, John Shepherd and Keith Shepherd inherited
a tract of land in Union Township, Belmont County, Ohio. Included in this tract of land
is the 61 acres that are at issue in this appeal. In 1962, Joseph Shepherd, John
Shepherd and Keith Shepherd sold the surface rights and coal interests they still had
in roughly 137 acres to Seaway Coal. Those individuals, however, reserved all other
mineral interests. Included in those 137 acres is the 61 acres at issue in this case.
The reservation reads:
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Excepting and reserving unto the said Grantors, their heirs and
assigns, all oil and gas lying under and within the premises hereby
conveyed, with the right to enter on said premises, prospect, explore and
drill for, develop, produce, store and remove the same, with all
machinery, structures, derricks, tanks, pipe lines, equipment, fixtures,
machinery and other appliances and things necessary or convenient
therefor, and the right to use so much of the surface as may be
necessary for the purposes aforesaid. However, said Grantors agree not
to interfere with the prosecution of the mining operations of said Grantee,
in the drilling and exploring for said gas and oil.
1962 Deed.
{¶4} In 1986, Seaway Coal sold all of the interest in the land to Shell Mining
Company. That 1986 deed contains the reservation of mineral interests to Joseph
Shepherd, John Shepherd, and Keith Shepherd that was contained in the 1962 deed.
{¶5} In November 1992, Shelling Mining sold all interest in the land to R&F
Coal by limited warranty deed. This 1992 deed also contains the 1962 reservation of
mineral interests. R&F Coal eventually sold the surface. In 1996 and 2006, the
Tribetts acquired a total of 61 acres from the original 137 acres that was sold by
Joseph Shepherd, John Shepherd and Keith Shepherd to Seaway Coal.
{¶6} On September 29, 2011, the Tribetts published a notice of abandonment
of mineral interest in the Times Leader, a local Belmont County newspaper. They did
not attempt service. On October 28, 2011, the Shepherds filed an affidavit to preserve
the mineral interests that they allegedly inherited from Joseph Shepherd, John
Shepherd and Keith Shepherd. On April 16, 2012, the Tribetts filed an action for Quiet
Title and Declaratory Judgment.
{¶7} At the outset, there were some joinder issues which are not at issue in
this appeal and thus, will not be discussed to further extent. The case then proceeded
to the merits. Each party filed their own sets of summary judgment motions and
opposition motions.
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{¶8} In their motion for summary judgment, the Tribetts argued that under
both the 1989 and 2006 version of the ODMA, they were entitled to have the mineral
interests deemed abandoned. They contended that there was no savings event that
made the mineral interests not abandoned.
{¶9} The Shepherds, on the other hand, argued that the mineral interests
were not abandoned. They contended that the 2006 version of the statute is
applicable, not the 1989 version. Along this same vein, they argued that the 1989
version constitutes an unconstitutional taking because allegedly this statute indicates
that unless a savings event occurs within the 20 year look-back period, the mineral
interest is deemed abandoned and vested in the owner of the surface. Alternatively
the Shepherds also argued that there were two savings events that occurred, the 1986
Shell Mining Deed and the 1992 R&F Coal Deed. Therefore, they also claimed that
under either statute the minerals were not abandoned. Specifically as to the 2006
version of the ODMA, they claimed that the Tribetts did not comply with the notice
provisions in the statute and thus the Tribetts could not prevail under that statute.
They argued that the notice provision in the 2006 version required that they, as
holders of the minerals, be served by certified mail of the attempt to have the minerals
deemed abandoned. The Tribetts did not attempt certified mail, rather they did service
through publication.
{¶10} In response to this motion, the Tribetts asserted that the 1989 version of
the ODMA is not unconstitutional and that it is applicable. They also argued that
neither the 1986 or 1992 deeds were savings events under the language of either
statute. They contended that the Shepherds were not holders of the mineral interest
and thus, they did not have to serve them by certified mail; they asserted publication
was sufficient.
{¶11} Following the arguments, the trial court granted summary judgment in
part for each party. The trial court specifically held that both versions of the ODMA
were applicable. It found that the 1989 act was constitutional based on the United
States Supreme Court’s decision in Texaco Inc. v. Short, 454 U.S. 516, 102 S.Ct. 781(1982). It found that the ODMA is part of the Ohio Marketable Title Act, but requires a
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higher standard for a savings event and that neither the 1986 nor 1992 deeds were
savings events because the mineral interests were not subject of the title transaction.
{¶12} That said, it found that the Tribetts did not properly invoke the 2006
version because the Shepherds were holders and by statute they were required to be
given notice of the owners intent to pursue abandonment. This notice was required to
be done by certified mail. The Tribetts made no attempt at certified mail but rather
went straight to publication notice, which is an alternative if certified mail cannot be
completed. Therefore, the trial court found that the Tribetts could not rely on the 2006
version to pursue their abandonment claim.
{¶13} As to the 1989 version of the ODMA, it once again discussed the 1986
and 1992 deeds. It found that under the 1989 version, the look-back period is a 20
year fixed period. It explained that “there is a 20 year look-back period from March 22,
1989 during which the ‘Savings Event’ must have occurred plus a 3 year grace period
to March 22, 1992. Thus, it looked from March 22, 1969 to March 22, 1992 and
indicated that the only potential savings event would be the 1986 deed. However, it
indicated that that deed was not an actual savings event because of its previous
determination that the mineral interest was merely recited in the deed and was not the
subject of the title transaction. Thus, the trial court concluded that the mineral
interests vested in the surface owners on March 22, 1992. The court then quieted title
in the mineral interests to the Tribetts. The grant of summary judgment in part for
each party was appealed to this court.
Shepherds First and Second Assignments of Error
{¶14} “The trial court erred in granting summary judgment for Plaintiffs-
Appellants.”
{¶15} “The trial court erred in not granting summary judgment in favor of
Defendants-Appellants.”
{¶16} The appellate brief combines the two arguments. The essence of the
Shepherd’s position is that there are no factual disputes and as a matter of law
summary judgment should have been granted for them, not for the Tribetts.
{¶17} In reviewing a summary judgment award we apply a de novo standard of
review. Cole v. Am. Industries & Resources Corp., 128 Ohio App.3d 546, 552, 715
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N.E.2d 1179 (7th Dist.1998). Thus, we use the same test the trial court did, Civ.R.
56(C). That rule provides that the trial court shall render summary judgment if no
genuine issue of material fact exists and when construing the evidence most strongly
in favor of the nonmoving party, reasonable minds can only conclude that the moving
party is entitled to judgment as a matter of law. State ex rel. Parsons v. Fleming, 68
Ohio St.3d 509, 511, 628 N.E.2d 1377 (1994).
{¶18} This appeal involves the Ohio Dormant Mineral Act (ODMA). This act
provides a mechanism for deeming mineral interests abandoned and having them
reattached to the surface. Multiple issues are raised in this appeal concerning the trial
court’s application of the ODMA. Each ruling will be addressed in turn.
1. “Subject of” the Title Transaction
{¶19} The Shepherds argued below and argue on appeal that the 1992 R&F
deed and the 1986 Shell Mining deed is a title transaction within the meaning of the
ODMA and thus, provides that the mineral interests were not abandoned. The trial
court disagreed and indicated that although the deeds do contain the language that
specifically identifies the oil and gas interests previously excepted in the 1962
Shepherd deed, the oil and gas exception is not the subject of the 1992 or 1986
deeds. “The mere reference to the oil and gas exceptions simply clarify that which is
being transferred.” 08/05/13 J.E. Thus, the trial court found that the 1992 and 1986
deeds were not savings events.
{¶20} The ODMA provides:
(B) Any mineral interest held by any person, other than the owner
of the surface of the lands subject to the 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 and none of the following applies:
***
(3) Within the twenty years immediately preceding the date on
which notice is served or published under division (E) of this section, one
or more of the following has occurred:
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(a) The mineral interest has been the subject of a title transaction
that has been filed or recorded in the office of the county recorder of the
county in which the lands are located.
R.C. 5301.56(B)(3)(a) (current version) (this provision in 1989 version is almost
identical).
{¶21} As aforementioned, the 1992 and 1986 deeds transferred the surface
and any coal interests that the previous party had acquired. Those deeds regurgitated
the original oil and gas reservation that was in the 1962 deed which transferred 137
acres and coal interest in that land from Joseph Shepherd, John Shepherd and Keith
Shepherd to Seaway Coal. The 1962 deed specifically indicated that Joseph
Shepherd, John Shepherd and Keith Shepherd and their heirs or assigns retained the
oil and gas interests in the 137 acres.
{¶22} As can be seen, these deeds are primarily for the conveyance of the
surface and any coal interests that the other party still had. As the trial court aptly
stated, the mere reference to the oil and gas exception was simply to clarify what was
being transferred. Or in other words, the restatement of the reservation was not the
primary purpose of these deeds. We have previously stated a subsequent
conveyance of surface rights in which the mineral interest reservation was simply
restatement is not a savings event under the ODMA. Dodd v. Croskey, 7th Dist. No.
12HA6, 2013-Ohio-4257, ¶ 48 (discretionary appeal accepted by the Ohio Supreme
Court on a different issue, cross-appeal on this issue not accepted, 2013-Ohio-1730);
Walker v. Shodrick-Nau, 7th Dist. No. 13NO402, 2014-Ohio-1499, ¶ 25-28.
Other than Riddel, there is no case law in Ohio discussing what
“subject of a title transaction” means. Furthermore, “subject of” is not
defined in the statute. Therefore, the phrase must be given its plain,
common, ordinary meaning and is to be construed “according to the
rules of grammar and common usage.” Smith v. Landfair, 135 Ohio St.3d
89, 2012–Ohio–5692, 984 N.E.2d 1016, ¶ 18. The common definition of
the word “subject” is topic of interest, primary theme or basis for action.
Webster's II New Riverside University Dictionary 1153 (1984). Under this
definition the mineral interests are not the “subject of” the title
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transaction. Here, the primary purpose of the title transaction is the sale
of surface rights. While the deed does mention the oil and gas
reservations, the deed does not transfer those rights. In order for the
mineral interest to be the “subject of” the title transaction the grantor
must be conveying that interest or retaining that interest. Here, the
mineral interest was not being conveyed or retained by Coffelt, the party
that sold the property to appellants.
Id.{¶23} The Shepherds argue that our decision is incorrect. They contend that
our focus was misplaced. We focused on the “subject of” language. Instead, they
contend that the focus should be on the definition of title transaction, which is “any
transaction affecting title to any interest in land, including title by will or descent, title by
tax deed, or by trustee’s, assignee’s, guardian’s, executor’s, administrator’s, or
sheriff’s deed, or decrees of any court as well as warranty deed, quit claim deed, or
mortgage.” R.C. 5301.47(F). Specifically, they would like the focus to be on “any
interest in land.” According to them, “any interest in the land” would be mineral
interests and therefore, any deed that recites the previous reservation is sufficient to
deem the interest not abandoned.
{¶24} The Shepherds are correct in their definition of a title transaction. It is
acknowledged that a title transaction affects any interest in land. However, the words
of the statute additionally required the mineral interest to be “subject of the title
transaction.” If the words “subject of” were omitted from the statute, the Shepherds
would probably be correct that a deed reciting a prior reservation would be sufficient to
prevent abandonment. However, those words are in the statute and must be given
effect.
{¶25} The Shepherds also ask us to look at the legislative history of the ODMA.
In enacting the 2006 version, the language first introduced was not “The mineral
interest has been the subject of a title transaction.” Rather, it was the “interest has
been conveyed, leased, transferred or mortgaged by an instrument filed or recorded in
the recorder’s office of the county in which the lands are located.” They contend that
since that language was removed that means that an actual conveyance or transfer is
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not necessary. Thus, they assert that subject of title transaction is broader and
provides for the situation, such as the one here, where a reservation is simply restated
in the deed.
{¶26} This same argument was presented in Walker and was summarily
deemed meritless based on the Dodd decision. Walker at ¶ 24. While the subject of
title transaction is probably broader than the language in the proposed statute, the
phrase “subject of the title transaction” is still more limited than simply being part of the
title transaction. The language of the statute, specifically “subject of,” still must be
given meaning. Other words could have been used to give the meaning that a
recitation of a previous reservation was sufficient to be a savings event for purposes of
abandonment, however they were not.
{¶27} Thus, despite their argument to the contrary, we stand by our decisions
in Dodd and Walker. The Shepherds argument about “subject of” is meritless.
2. ODMA vs. Ohio Marketable Title Act (OMTA)
{¶28} The Shepherds also argued below and also on appeal that the ODMA is
a part of the OMTA and is the subject of the restrictions of R.C. 5301.49(A), which
states that a record marketable title is subject to “all interests and defects which are
inherent in the muniments of which such chain of record title is formed.” Thus, the
Shepherds asserted that the 1986 Shell Mining Deed and the 1992 R&F Coal Deed,
which specifically identified the severed mineral interest, complies with that restriction.
As such, it seems that they are asserting that those deeds are savings events to
abandonment.
{¶29} This argument appears to be an attempt to get around the words “subject
of” that are specifically used in the ODMA. As explained above, the use of the words
“subject of” mean that the 1986 and 1992 deeds do not constitute savings events
under the ODMA.
{¶30} The trial court did not find any merit with the Shepherds OMTA
argument:
The Ohio Dormant Mineral Act is part of the Ohio Marketable Title
Act. The specific language required by the Dormant Mineral Act controls
over the general language of the Marketable Title Act. The Dormant
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Mineral Act requires a higher test for a “Savings Event” than does the
language of the Marketable Title Act. This Court does not find the mere
filing, of the 1986 Shell Mining Deed or the 1992 R&F Coal Deed within
the muniments of title, to be controlling.
08/05/13 J.E.
{¶31} As discussed above, the ODMA provides in layman’s terms that a
mineral is not abandoned if within 20 years a savings event occurred. One such
savings event is that the mineral interest has been the subject of a title transaction that
has been filed or recorded. R.C. 5301.56(B).
{¶32} The OMTA provides:
Such record marketable title shall be subject to:
(A) All interests and defects which are inherent in the muniments
of which such chain of record title is formed; provided that a general
reference in such muniments, or any of them, to easements, use
restrictions, or other interests created prior to the root of title shall not be
sufficient to preserve them, unless specific identification be made therein
of a recorded title transaction which creates such easement, use
restriction, or other interest; and provided that possibilities of reverter,
and rights of entry or powers of termination for breach of condition
subsequent, which interests are inherent in the muniments of which such
chain of record title is formed and which have existed for forty years or
more, shall be preserved and kept effective only in the manner provided
in section 5301.51 of the Revised Code.
R.C. 5301.49(A).
{¶33} As can be seen, there are differences between the two statutes. For
instance, the ODMA provides for a 20 year period, while the Ohio Marketable Title Act
is for a 40 year period. Likewise, the words “subject of” are used in the ODMA to
modify the title transaction. Such words as modifiers are not used in the Ohio
Marketable Title Act.
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{¶34} Furthermore, recently we have explained that the ODMA is a specific
statute as to minerals and the OMTA is a general statute. Swartz v. Householder, 7th
Dist. Nos. 13JE24, 13JE25, 2014-Ohio-2359, ¶ 19-20.
{¶35} R.C. 1.51 provides:
If a general provision conflicts with a special or local provision,
they shall be construed, if possible, so that effect is given to both. If the
conflict between the provisions is irreconcilable, the special or local
provision 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.
{¶36} The ODMA is a specific statute as to minerals and to determine if they
are abandoned. In comparison, R.C. 5301.49 is a more general statute in the OMTA.
There are no enactment dates which would indicate that the general statute controls
over the specific statute. Furthermore, as the trial court notes, the ODMA has a higher
standard. It requires the mineral interest to be subject of the title transaction. That
element is not found in the OMTA. Thus, for those reasons, the ODMA controls in
determining whether minerals are abandoned; the specific statute controls over the
general statute. Swartz; See Davis v. State Personnel Bd. of Rev., 64 Ohio St.2d 102,
105, 413 N.E.2d 816 (1980) (specific statute controls over general statute).
{¶37} Consequently, the trial court’s decision concerning the ODMA and OMTA
is correct. Any argument to the contrary is meritless.
3. Does the 1989 version of the ODMA apply?
{¶38} There are two versions of the ODMA that are at issue in this case. The
current version is the 2006 version. The prior version is the 1989 version. The
Tribetts invoked both versions in an attempt to have the minerals deemed abandoned.
{¶39} The trial court found that the 2006 version was not properly invoked
because the Tribetts did not comply with the statute in giving the required notice to the
mineral holders. Thus, the trial court found that the 2006 version could not be used to
have the mineral interests deemed abandoned. That ruling is not an issue in this
argument, but will be discussed later under the Tribetts cross-appeal.
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{¶40} The trial court then went on to apply the 1989 version, the prior version
of the statute. The Shepherds contend that the trial court should have only applied the
2006 version. They assert that neither the Tribetts nor their predecessors-in-interest
sought to quiet title between 1989 and 2006, when the 1989 version was in effect.
Thus, according to them, common sense points to the conclusion that only the current
version of the ODMA is applicable. They similarly claim that the 2006 version was the
law that was in effect during the events that gave rise to this suit and for that reason it
should also apply. They further assert that the 2006 version should apply because the
2006 version provides mineral interest holders with the notice of possible divestment
of their property rights.
{¶41} These arguments parallel arguments that were made and rejected in
both Walker and Swartz. In both cases we found that the 1989 ODMA can still be
used after the 2006 ODMA amendment because the prior statute was self-executing
and the lapsed right automatically vested in the surface owner. Walker, 2014-Ohio-
1499, at ¶ 30-51; Swartz, 2014-Ohio-2359, at ¶ 23-39.
{¶42} As explained in those cases, a vested interest can be a property right
created statute; it “‘so completely and definitely belongs to a person that it cannot be
impaired or taken away without the person's consent.’” Walker at ¶ 40 quoting, State
ex rel. Jordan v. Indus. Comm., 120 Ohio St.3d 412, 2008-Ohio-6137, ¶ 9; Swartz at ¶
29.
{¶43} The 1989 version of the ODMA states that any mineral interest held by
anyone other than the surface owner “shall be deemed abandoned and vested” in the
surface owner if none of the state circumstances applied. This version became
effective March 22, 1989 and gave a three-year grace period until March 22, 1992 for
mineral interest holders to take action for their interest to not be deemed abandoned.
In the case at hand, the trial court found that there was no savings event for 20 years
preceding the enactment date of the statute and not during the three-year grace
period. Thus, the court concluded that the interest was deemed vested in the property
owner on March 22, 1992. However, neither Shell nor any subsequent surface owner,
until the Tribetts, took any action to formalize the statutory vesting; the Tribetts took
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action in 2011 to have the minerals deemed abandoned and vested. This was done
after the 2006 amendments to the ODMA.
{¶44} In Walker and Swartz, this court explained that R.C. 1.58 indicates that
an amendment or repeal of a statute does not affect the prior operation of the statute
or affect “any validation, cure, right, privilege, obligation, or liability previously acquired,
accrued, accorded or incurred thereunder.” R.C. 1.58(A)(1),(2). In the 2006 version of
the ODMA there is no language to suggest that it should be applied retroactively; the
2006 amendment would not affect any “validation, cure, right, privilege, obligation, or
liability previously acquired.” Walker at ¶ 37; Swartz at ¶30-31.
{¶45} Furthermore, pursuant to R.C. 1.48, statutes are presumed to be
prospective unless expressly made retrospective. Walker at ¶ 36; Swartz at ¶ 31. The
2006 ODMA contains no language eliminating property rights that were previously
expressly said to be vested. Swartz at ¶ 34. Thus, without express language
eliminating the prior automatic abandonment and vesting of rights under the old act,
the amendments do not affect causes already existing. Id.{¶46} Considering the above, this court concluded that the “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.” Swartz
at ¶ 34.
{¶47} That said, we are aware of the Dahlgren decision from the Carroll County
Common Pleas Court which reaches the opposite conclusion and found no merit with
the “automatic vesting theory.” Dahlgren concluded that the lack of a savings event at
most created an inchoate right because judicial action would be required in order to
officially transfer ownership on the record. In both Walker and Swartz this court
addressed the Dahlgren decision and found no merit with rationale or conclusion
reached by that court. Walker at ¶ 43-51; Swartz at 36-39. We explained that the
terms inchoate and vested are generally opposites; “an inchoate right is a right that
has not fully developed, matured or vested.” Swartz at ¶ 38. Thus, we found that “it is
contrary to the plain language of the statute to hold that the surface owner’s right to
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the abandoned mineral interest are inchoate even though the statute expressly stated
that the right vested upon the lack of a savings event within the pertinent time period.”
Id. Therefore, based on our prior decisions and the reasoning 1989 version of the
ODMA is applicable and any argument to the contrary is meritless.
4. Is the Application of the 1989 Version of the ODMA
barred by the statute of limitations in R.C. 2305.04.
{¶48} Next, the Shepherds argue that the 1989 version of the ODMA is barred
by the statute of limitations in R.C. 2305.04.
{¶49} The statute reads:
An action to recover the title to or possession of real property shall
be brought within twenty-one years after the cause of action accrued, but
if a person entitled to bring the action is, at the time the cause of action
accrues, within the age of minority or of unsound mind, the person, after
the expiration of twenty-one years from the time the cause of action
accrues, may bring the action within ten years after the disability is
removed.
R.C. 2305.04.
{¶50} The Shepherds argue that the ODMA took effect on March 22, 1989 and
thus, the 21 year statute of limitations in R.C. 2305.04 expired on March 22, 2010.
The quiet title action was not filed until April 2012. Therefore, according to them, the
action is barred by the statute of limitations.
{¶51} The Tribetts assert that the statute of limitations is not applicable to them
because they were not attempting to recover title or possess the real estate. They
claim that since the 1989 ODMA is self-executing and deems the interest vested, their
quiet title action was merely an action to remove the cloud placed on their title by the
Shepherds.
{¶52} This argument may have merit. However, we do not need to reach it
because, even if the statute of limitations does apply, despite Shepherds argument to
the contrary, the limitations period had not expired when the April 2012 action was
filed.
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{¶53} As aforementioned, under the 1989 statute, holders of mineral interests
were granted 3 years to preserve their mineral interest if there was no other savings
event under the statute that was applicable to them. Therefore, if the surface owner
knew that there was no savings event within the preceding 20 year period, it could not
act to have the mineral interest to be deemed abandoned until after the three year
grace period. This time permitted the mineral owner time to preserve their interest.
Thus, any cause of action to quiet title in the mineral interest would not accrue until the
passing of the 3 year grace period, which would be March 22, 1992. Here, that is the
date that the right vested. Twenty-one years from that date is March 22, 2013. Thus,
at the time of filing the quiet title action in April 2012, the statute of limitations had not
run. For those reasons, the statute of limitations argument fails.
5. Constitutionality of 1989 version of ODMA.
{¶54} The Shepherds argue that the 1989 version of the ODMA is
unconstitutional. They acknowledge the United States Supreme Court’s decision in
Texaco, but argue that any reliance on that decision is misplaced because it is an old
case, it was a 5-4 decision, and it is solely based on federal constitutional issue of due
process, equal protection and taking claims under the Fourteenth Amendment, not on
state constitutional provision barring retroactive legislation. However, their core argue
is that the retroactive use of the 1989 version of the ODMA to divest the Shepherds of
their mineral rights violates Article II, Section 28 of the Ohio Constitution (Retroactive
Laws provision). The most we can construe from this argument is that they believe
that the 20 year look-back period in the 1989 version of the ODMA is retroactive
because it takes away their vested rights. They claim a statute is unconstitutionally
retroactive “if, and only if, it also impairs a vested right or creates some new obligation
or burden as well.”
{¶55} In Texaco, the United States 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 20 years and for which no statement of claim has been filed.
Texaco Inc. v. Short, 454 U.S. 516, 102 S.Ct. 781 (1982). The Court found that it was
the owner's failure to make any use of the property, rather than the state's action, that
caused the lapse of the property right. Id. at 529-531 (no unconstitutional taking and
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no impairment of contract). The Court also stated that no individual notice was
required before abandonment and no opportunity to cure must be provided because
the statute’s two-year grace period provided notice. Id. (the only other required notice
involved an opportunity to prove a savings event, not to avoid any prior automatic
abandonment).
{¶56} Ohio’s 1989 ODMA provided notice of three years within which the
mineral owners could save their interest before any abandonment would vest. See id.at 454 and at 518-519 (Indiana gave a two-year grace period). Thus, since the
Indiana statute did not violate the federal constitution, neither would Ohio’s.1
{¶57} Admittedly, the argument being raised here is a specific Ohio retroactive
issue. We have previously stated that there is no language in the 2006 version of R.C.
5301.56 to suggest that it is to be applied retroactively. Walker at ¶ 36; Swartz at ¶
31-35. This discussion concerns the 20 year look-back period that is found in the
2006 statute. Our statement in Walker was based on the conclusion that a look-back
period does not make a statute retroactive. Swartz at ¶ 34, fn. 2. The 1989 version,
like the 2006 version, has a 20 year look-back period. Thus, if the look-back period for
the 2006 version is not retroactive, neither is the look-back period in the 1989 version.
Furthermore, the Ohio statute contains a three-year grace period. This three year
period provides holders the opportunity to take action to preserve their mineral
interests. Therefore, for those reasons we find that the 1989 version of the statute is
not unconstitutional. Shepherds argument to the contrary fails.
1
The dissent contends that it was not the intent of the 1989 ODMA to be self-executing. In
doing so it cites to the Legislative Services final bill analysis for the 2006 ODMA. We disagree with the
use of the 2006 ODMA bill analysis to indicate what the intent was when the 1989 ODMA was enacted.
The intent of the 1989 ODMA can only be gathered from the bill analysis of the 1989 ODMA. It cannot
be gathered from the bill analysis of the 2006 ODMA. Members of general assembly that enacted the
1989 ODMA were not necessarily the same members that enacted the 2006 ODMA. Furthermore, “[i]t
is a cardinal rule that a court must first look to the language of the statute itself to determine the
legislative intent. * * * If that inquiry reveals that the statute conveys a meaning which is clear,
unequivocal and definite, at that point the interpretative effort is at an end, and the statute must be
applied accordingly.” State v. Roberts, 134 Ohio St.3d 459, 2012-Ohio-5684, 983 N.E.2d 334, ¶ 21,
quoting Provident Bank v. Wood, 36 Ohio St.2d 101, 105–106, 304 N.E.2d 378 (1973). The inquiry into
legislative intent, legislative history, public policy, the consequences of an interpretation, or any other
factors identified in R.C. 1.49 is inappropriate absent an initial finding that the language of the statute is
ambiguous. Dunbar v. State, 136 Ohio St.3d 181, 2013-Ohio-2163, 992 N.E.2d 1111, ¶ 16. We have
not concluded that the 1989 version of the ODMA is ambiguous because we stated the look-back period
is fixed.
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6. Fixed or rolling look-back period?
{¶58} In this case, the trial court used a fixed 20 year look-back period, instead
of a 20 year rolling look-back period. A fixed date would be from one specific date,
which in this case would be the date of the statute and then look-back 20 years.
Under a rolling look-back period, it would be any 20 year period. The Shepherds
contend that the trial court erred in determining that the look-back period is a fixed
period, rather than a rolling period.
{¶59} Recently, we have addressed an argument similar to the one made in
this case and have concluded that the look-back period is a fixed period. Eisenbarth v.
Reusser, 7th Dist. No. 13MO10, 2014-Ohio-3792, ¶ 33-51. We explained:
Ohio’s 1989 DMA, however, merely states that the interest is deemed
abandoned if none of the savings events occurred within the preceding twenty
years. The question is: within the preceding twenty years of what? The
Eisenbarths’ position means that the answer to this question is: the preceding
twenty years of every single day after the statute’s enactment (until the new
statute was enacted).
In considering this question, we ask: would a mineral rights owner be
unreasonable in reading the statute on March 22, 1989, the day of enactment
and saying, “I have a savings event in the past twenty years as I just bought
these mineral rights in 1974; so, I’m safe,” without realizing that they had to
reassert their interest by 1994 (5 years after enactment and 2 years after the
grace period)?
We credit such thoughts as reasonable, and we conclude that the
statute is ambiguous as to whether the look-back period is anything but fixed.
The use of the words “preceding twenty years,” without stating the preceding
twenty years of what, does not create a rolling look-back period. Rather, the
imposition of successive look-back periods would have required language that
the mineral interest is deemed abandoned and vested if no savings events
occurred within twenty years after the last savings event.
The mention of successive claims to preserve and indefinite
preservation in R.C. 5301.56(D)(1) could merely be a reference to any
preservations that were filed under the OMTA as existed prior to the 1989 DMA
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in order to show that a new claim to preserve can still be filed if the old one was
filed outside of the new twenty-year look-back. There is other statutory
language connecting the twenty-year look-back period to the date of enactment
as (B)(2)’s grace period provides three years from the date of enactment before
items will be deemed abandoned. R.C. 5301.56(B)(2). As forfeitures are
abhorred in the law, we refuse to extend the look-back period from fixed to
rolling. See generally State ex rel. Falke v. Montgomery Cty. Resid. Dev., Inc.,
40 Ohio St.3d 71, 73, 531 N.E.2d 688 (1988) (the law abhors a forfeiture).
Id. at ¶ 46-49.
{¶60} We stand by that decision.
{¶61} Regardless of whether the period is fixed or rolling, the Shepherds will
not prevail on appeal because the only potential savings events are the two deeds that
regurgitated the mineral reservations. As previously stated, those deeds do not
constitute savings events because the mineral interests were not “subject of” the title
transaction. Therefore, for those reasons, the Shepherds fixed versus rolling look-
back period argument fails.
Cross Appeal
{¶62} The Tribetts cross appeals deals with the trial court’s ruling regarding the
2006 version of the ODMA. They are alternative arguments in case this court would
find that the trial court incorrectly applied the 1989 Act. As we find no error with the
trial court’s application of the 1989 version of the ODMA; the mineral interests vested
with the surface owners, the Tribetts. Therefore, since the Tribetts prevail in having
the mineral interest vest, we could decline to address the cross assignments of error.
However, in the interest of thoroughness all arguments will be addressed.
Cross Appeal First Assignment of Error
{¶63} “The lower court erred to the prejudice of Plaintiffs-cross-appellants in
overruling their motion for summary judgment on the issue of whether defendants-
appellants are holders or holders’ successors or assignees under Ohio Revised Code
Section 5301.56 (2006).”
{¶64} This argument concerns solely the 2006 version of the ODMA. At the
trial level, the Tribetts argued that under the 2006 version the Shepherds are not
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holders, successors or assigns. Accordingly, the Tribetts contended that the affidavit
of preservation that the Shepherds filed has no legal effect since only holders,
successors or assigns are authorized to preserve.
{¶65} The trial court determined that the Shepherds were holders. It cited R.C.
5301.56(A), which defines holders as record holder of a mineral interest and “any
person who derives the person’s rights from, or has a common source with, the record
holder and whose claim does not indicate, expressly or by clear implication that it is
adverse to the interest of the record holder.” The court concluded that the Shepherds
are holders because their interests are derived from the record holders (Joseph, John
and Keith Shepherd). This was done through testate or intestate succession.
{¶66} The Tribetts focus their argument on the fact that the legislature used the
word “holder” instead of “heirs.” The argument of the Tribetts is based on the premise
that an heir is broader in definition than a holder. For instance, they state that heirs
may often be divested of their interest by will, the probate process, the Ohio Statute of
Descent and Distribution, and by creditors’ claims.
{¶67} That statement is legally accurate. However, what if none of the above
occurs. The person would be an heir and could qualify as a holder. While it may be
true that not all heirs qualify as holders, that does not mean that heirs can never
qualify as holders.
{¶68} Furthermore, even by the definitions in Black’s Law Dictionary it appears
that in some instances an heir can be a holder:
1. A person who, under the laws of intestacy, is entitled to receive
an intestate decedent’s property. * * * 2. Loosely, (in common–law
jurisdictions), a person who inherits real or personal property, whether by
will or by intestate succession. 3. Popularly, a person who has inherited
or is in line to inherit great wealth. 4. Civil Law. A person who succeeds
to the rights and occupies the place of, or is entitled to succeed to the
estate of, a decedent, whereby an act of the decedent or by operation of
law.
Black’s Law Dictionary 740 (8th Ed.2004).
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{¶69} As the fourth definition indicates, an heir is a person who succeeds to the
rights of, which means his right is derived from the record holder. There does not
appear to be any dispute that the Shepherds are heirs, that the mineral interests were
not divested (by any other means than potentially abandonment), and their rights are
derived from the record holder. Consequently, the trial court’s analysis is not incorrect.
{¶70} The next argument under this assignment of error concerns notice
requirements under the 2006 version of the ODMA. R.C. 5301.56(E) requires the
holders to be given notice of the surface owners intent to pursue abandonment. The
trial court found that the Tribetts did not comply with that provision and therefore, the
Tribetts could not rely upon the 2006 version of the act to pursue their abandonment
claim. That provision states:
(E) 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) Serve notice by certified mail, return receipt requested, to each
holder or each holder's successors or assignees, at the last known
address of each, of the owner's intent to declare the mineral interest
abandoned. If service of notice cannot be completed to any holder, the
owner shall publish notice of the owner's intent to declare the mineral
interest abandoned at least once in a newspaper of general circulation in
each county in which the land that is subject to the interest is located.
The notice shall contain all of the information specified in division (F) of
this section.
(2) At least thirty, but not later than sixty days after the date on
which the notice required under division (E)(1) of this section is served or
published, as applicable, file in the office of the county recorder of each
county in which the surface of the land that is subject to the interest is
located an affidavit of abandonment that contains all of the information
specified in division (G) of this section.
R.C. 5301.56
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{¶71} In this case, it is undisputed that the Tribetts did not attempt certified
mail. The original holders were dead; therefore, instead of attempting service on a
dead man, the Tribetts did a publication notification. It seems that they deemed it too
cumbersome to look through the probate records to determine the heirs. The
publication notice was on September 29, 2011, the Shepherds’ affidavit of
preservation was filed October 28, 2011.
{¶72} R.C. 5301.56(H)(1)(a) provides that a holder’s claim to preserve a
mineral interest or a holder’s affidavit describing a savings event must be filed no later
than sixty days after the date on “which the notice was served or published.”
{¶73} Therefore, the claim of preservation that was filed by the Shepherds was
timely under the statute, despite the fact that certified mail was never attempted. In
Dodd, we stated in a similar situation that when the claim was filed within the time limit
and certified mail was not attempted, the error was harmless. Our reasoning was that
someone saw the publication and was able to file a claim within the required amount of
time. Dodd v. Croskey, 7th Dist. No. 12HA6, 2013-Ohio-4251, ¶ 51-60.
{¶74} Therefore, on the basis of Dodd, the trial court’s conclusion that the
Tribetts could not utilize the 2006 version of the ODMA because they did not comply
with the certified mail service requirement was incorrect. Any error from failing to
serve by certified mail was harmless.
Cross Appeal Second Assignment of Error
{¶75} “The lower court erred to the prejudice of Plaintiffs-Cross Appellants in
overruling their motion for summary judgment on the issue of whether a severed oil
and gas mineral interest is abandoned and terminated and irrevocably vested in the
surface owner upon a mineral interest holder’s receipt of notice of abandonment under
Ohio Revised Code Section 5301.56 (2006).”
{¶76} This assignment of error addresses the adequacy of the claim of
preservation. If the 1989 act does not provide a basis for the Tribetts to have the
mineral interests deemed abandoned, under the 2006 version of the ODMA, the
Tribetts argue the claim to preserve filed by the Shepherds was not adequate. Our
resolution of the Shepherds’ appeal renders this assignment of error moot; it does not
matter if the claim to preserve was adequate or inadequate, the mineral interest are
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deemed abandoned under the 1989 Act. However, in anticipation of our decision
being reviewed by the Ohio Supreme Court, we will still address this assignment of
error. In doing so we are looking at the 2006 version of the ODMA in a vacuum
without considering whether the mineral interests vested under the 1989 version. We
have previously held that where there was no other savings event in the preceding 20
years, that under the 2006 version of the statute, the claim of preservation was a
savings event. Dodd at ¶ 17-36 (Ohio Supreme Court has accepted this issue for
review 138 Ohio St.3d 1432). That ruling is squarely on point for this issue. Thus,
under the 2006 act, the Shepherds preserved their interests. The Tribetts argument to
the contrary is overruled. The summary judgment award for the Shepherds on the
2006 ODMA was appropriately granted based on the claim to preserve.
Conclusion
{¶77} For the foregoing reasons, the judgment of the trial court is hereby
affirmed. The trial court appropriately granted summary judgment in part for each
party. However, since the 1989 version of the ODMA is applicable and the minerals
automatically vest in the surface, the trial court appropriately quieted title in the
minerals in favor of the Tribetts.
Donofrio, J., concurs.
DeGenaro, P.J., dissents; see dissenting opinion.
DeGenaro, P.J., dissenting.
{¶78} I agree with the majority that pursuant to this court's decision in Dodd v.
Croskey, the 1986 and 1992 deeds do not constitute title transactions and thus are not
savings events under R.C. 5301.56, Ohio's Dormant Mineral Act (ODMA). See Dodd
v. Croskey, 7th Dist. No. 12 HA 6, 2013-Ohio-4257, discretionary appeal accepted by,
138 Ohio St.3d 1432, 2014-Ohio-889, 4 N.E.3d 1050. But I disagree with the majority
and the recent trilogy holding that the 1989 ODMA controls resolution of this and other
cases filed after the effective date of the 2006 ODMA: Walker v. Shondrick–Nau, 7th
Dist. No. 13 NO 402, 2014-Ohio-1499 (Apr. 3, 2014) (fka Walker v. Noon); Swartz v.
Householder, 7th Dist. Nos. 13 JE 24, 13 JE 25, 2014-Ohio-2359, --- N.E.3d --- (June
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2, 2014); and Eisenbarth v. Reusser, 7th Dist. No. 13 MO 10, 2014-Ohio-3792 (Aug.
28, 2014). Consistent with the analysis in the minority opinion in Eisenbarth
(DeGenaro, P.J. concurring in judgment only), the 2006 ODMA should control
resolution of disputes over severed mineral rights where, as here: a) the mineral rights
were severed and the surface owner's fee interest was acquired before or during the
time frame when the 1989 ODMA was in effect; and b) the surface owner did not claim
the mineral rights were abandoned until after the effective date of the 2006 ODMA.
Moreover, the 1989 ODMA is unconstitutional both facially and as applied by the
majority. Because Ohio affords its citizens' property rights with more protection than
the federal Constitution or that of Indiana, the United States Supreme Court decision in
Texaco, Inc. v. Short, 454 U.S. 516, 102 S.Ct. 781, 70 L.Ed.2d 738 (1982) is not
controlling for purposes of interpreting the ODMA. Thus, contrary to the Walker,
Swartz and Eisenbarth trilogy, the 1989 DMA cannot be interpreted as an automatic,
self-executing statute by relying on Texaco, and withstand scrutiny under Ohio's
constitution. Statutes in derogation of common law should be strictly construed,
particularly where forfeiture involves inviolate private property rights protected by the
Ohio Constitution.
{¶79} By measuring the 1989 ODMA against federal, rather than Ohio
constitutional property rights standards and declaring it a constitutional self-executing
statute, the majority has created a forfeiture of inviolate private property rights in
contravention of Ohio constitutional jurisprudence. The 1989 ODMA's lack of notice
provisions makes it unconstitutional on its face, and by construing it as a self-
executing statute resulting in automatic abandonment of a severed mineral interest by
the holder and vesting that interest in the surface fee owner, the 1989 ODMA is
unconstitutional as applied. Such a statutory construction results in an unlawful taking
by operation of law, proscribed by Ohio Constitution, Article I, Sections 1 and 9, as
construed by the Ohio Supreme Court in City of Norwood v. Horney, 110 Ohio St.3d
353, 2006-Ohio-3799, 853 N.E.2d 1115.
{¶80} Given Ohio constitutional principles and the minority analysis in
Eisenbarth, the majority has incorrectly validated the trial court's resolution of the
parties' interests to the severed mineral rights pursuant to the 1989 ODMA when the
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2006 ODMA controls. As the Shepherds timely filed a preservation of claim under the
2006 ODMA, R.C. 5301.56(H), they continue to hold the severed mineral rights.
{¶81} Although first and foremost I disagree with the majority's decision that the
1989 ODMA governs here, secondarily I disagree with the analysis that the 1989
ODMA has a fixed look-back period. I interpret this holding as creating a bright-line
rule. Instead, determination of whether a severed mineral interest has been
abandoned must be decided on a case by case basis, and determine whether an initial
savings event occurred within the original statutory 20 year period, to trigger a
successive 20 year period in order to preserve the severed mineral interest. Operating
under this rationale, the original statutory period in this case ran from March, 1969
through March 1992. Because no savings event occurred during that time period to
create a second, successive 20 year period, the Sheperds' severed mineral interest
was automatically abandoned by operation of the 1989 ODMA, and title to the mineral
rights should be quieted in the Tribetts.
Nature of Interest, Forfeiture, Vesting and Laches
{¶82} Prior to the enactment of R.C. 5301.56 severed mineral rights were
governed by Ohio common law. Eisenbarth at ¶79. (DeGenaro, P.J. concurring in
judgment only). Generally, statutes in derogation of common law are strictly
construed; specifically, statutes imposing restrictions in derogation of private property
rights must be construed to avoid forfeiture, which is not favored in the law, and cannot
be ordered absent clear statutory expression. Id. at ¶80. (DeGenaro, P.J. concurring
in judgment only).
{¶83} A fee simple interest—which includes severed mineral rights—under
common law "cannot be extinguished or abandoned by nonuse, and it is not necessary
to rerecord or to maintain current property records in order to preserve an ownership
interest in minerals."2 "An individual's vested right—created by common law or
statute—has been generally defined by the Ohio Supreme Court as being in essence
a property right, which is to be recognized and protected by the state from arbitrary
2
Dahlgren v. Brown Farm Props., LLC., Carroll C.P. No. 2013 CVH 274455, *8, quoting the
Prefatory Note of the Uniform Dormant Interests Act, approved by the National Conference of
Commissioners on Uniform State Laws in 1986, approved by the A.B.A. on February 16, 1987.
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deprivation; a vested right is more than a mere expectation or interest in the continuity
of current common or statutory law; because it completely and definitely belongs to the
individual it cannot be impaired or divested absent the individual's consent. The legal
weight a vested right carries is reinforced by the axiom ingrained in Ohio common law
that forfeiture is not favored in law or in equity." (Internal citations omitted) Eisenbarth
at ¶78. (DeGenaro, P.J. concurring in judgment only).
{¶84} Consistent with principles of vesting, forfeiture and laches, the 1989
ODMA defined the surface fee owner's interest in the severed mineral rights as an
inchoate right; by use of the term deemed, R.C. 5301.56 created the possibility of
allowable vesting to occur, not an automatically vested right. Id. at ¶81-85, 90-91.
(DeGenaro, P.J. concurring in judgment only).
{¶85} The ODMA is a remedial rather than a substantive statute because its
purpose is to set forth the judicial process to follow when ownership of a severed
mineral right is disputed; R.C. 5301.56 delineates the parameters to determine
whether or not a severed mineral interest has been abandoned and if so, how to
reunite it with the surface fee, and is to be applied prospectively to any case filed after
each version's respective effective date. Id. at ¶86-89. (DeGenaro, P.J. concurring in
judgment only). To construe the 1989 ODMA as controlling and an automatic self-
executing statute has resulted in a retroactive, substantive deprivation of the
Sheperds' common law vested interest in the severed mineral rights. Id. at ¶87, 92-97,
110-111. (DeGenaro, P.J. concurring in judgment only). Inherent in the automatic,
self-executing character ascribed to the 1989 ODMA is that it operates as a forfeiture,
which the law abhors. Id. (DeGenaro, P.J. concurring in judgment only).
{¶86} The look-back period provision of the ODMA should not be confused with
the analytical principle of retroactivity. Applying the look back provision of the ODMA
version in effect at the time ownership of the severed interest is being litigated in a
particular case contemplates resolving a factual question. Determining which ODMA
version controls in a particular case contemplates determining through which lens
those facts are viewed. When R.C. 5301.56 is given the proper remedial
interpretation, there is no issue of retroactive versus prospective application and the
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propriety thereof. But where, as here, a substantive interpretation is given to the
ODMA, applying it retroactively runs afoul of Ohio law in that regard.
{¶87} Finally, and conceding the doctrine of laches was not raised,
nonetheless it bears consideration here as in Eisenbarth. The Tribetts' predecessors
in interest and the Tribetts, who took title to the surface fee over a series of
transactions in February, 1996, and March, 2006, failed to avail themselves of the
1989 ODMA while it was still in effect. An action to quiet title could have been filed as
early as 1992 when the mineral rights arguably automatically reverted to the Tribetts'
predecessors in interest by operation of the 1989 ODMA. Instead, it wasn't until after
the 2006 ODMA went into effect, that the Tribetts published a notice of abandonment
in February, 2012 pursuant to the 2006 ODMA—in response to which the Sheperds
timely filed a claim to preserve—and then filed a quiet title action later that year. The
prejudice to the Sheperds is evident. Logic dictates that if the holder can be divested
of their severed mineral rights as having been abandoned due to their inaction under
the 1989 ODMA, then the 2006 ODMA can similarly be used to preclude reuniting the
interest with the surface fee because of the surface owner's inaction, i.e., his failure to
commence a quiet title action while the 1989 ODMA was still in effect. Id. at ¶91.
(DeGenaro, P.J. concurring in judgment only).
2006 ODMA Governs Resolution of Severed Mineral Rights Disputes
{¶88} Consistent with the analysis in the minority opinion in Eisenbarth, the
majority has given the 1989 ODMA effect despite the General Assembly's enactment
of the 2006 ODMA. Where litigation to resolve disputes between the surface fee
owner and the severed mineral rights holder was filed after the 2006 ODMA took
effect, the 2006 version controls; the 1989 version has no force or effect. This
conclusion is consistent with reading the OMTA and the ODMA in pari materia, and
more importantly, with the General Assembly's express intent in enacting the 2006
ODMA and the statute's clear unambiguous language. Eisenbarth at ¶104-118
(DeGenaro, P.J. concurring in judgment only).
{¶89} To interpret the 1989 ODMA as automatic and self-executing would
confound the purpose of the OMTA, as well as the ODMA: to engender reliance upon
publicly recorded documents rather than private ones for transactions affecting title to
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real property, such as ownership of severed mineral rights. Nothing in either version
of the ODMA suggests that it should not be construed in pari materia with the OMTA.
Notice remains the watchword of the entire OMTA, an omission in the 1989 ODMA
that was corrected by the General Assembly in the 2006 ODMA. R.C. 1.51 dictates
that a special provision should be construed with a more general provision, if possible,
to give effect to both. As part of the general OMTA statutory scheme, the ODMA can
be read as defining the surface owner's interest in the severed mineral rights as an
inchoate right and still give effect to its specific provisions and purpose within the
global purposes of the OMTA as well. Eisenbarth at ¶85, 94, 104-107. (DeGenaro,
P.J. concurring in judgment only).
{¶90} The ambiguity of the 1989 version of the ODMA is readily apparent.
Courts are guided by canons of statutory construction when asked to construe
ambiguous statutory language in order to decipher legislative intent. But given the
unique procedural circumstances in this and the trilogy of recent cases in this district
presents; namely, construing an ambiguous statute after it has been amended to
remove the ambiguity, we need not resort to those canons in order to glean that intent.
By virtue of the 2006 ODMA, we have the rare benefit of the General Assembly's
statement of its intent with respect to the ambiguous language of the 1989 ODMA.
That alone dictates that the 1989 version is no longer controlling; to decide otherwise
makes the enactment of the 2006 ODMA meaningless. Eisenbarth at ¶67.
(DeGenaro, P.J. concurring in judgment only).
{¶91} The majority asserts that the 1989 OMDA has not been found to be
ambiguous. Majority, supra, at ¶56, footnote 1. I beg to differ.
{¶92} The Eisenbarth majority's analysis at ¶45-50, quoted in part here,
Majority, supra, at ¶59, "simultaneously reinforces the ambiguity of the 1989 ODMA as
a whole, and ignores the statutory language referencing successive filings."
Eisenbarth at ¶124. (DeGenaro, P.J. concurring in judgment only). After posing the
question "within the preceding twenty years of what?" Eisenbarth at ¶46, the majority
in Eisenbarth held that "the statute is ambiguous as to whether the look-back period is
anything but fixed." Id. at ¶48. Said differently, the Eisenbarth majority concluded that
the statute is ambiguous because that means the look-back period could be anything,
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including fixed, which is how the panel chose to construe the look-back period. This
point is borne out by the Eisenbarth majority then going on to posit a reasonable
interpretation in response to the question, as quoted above. Majority, supra, at ¶59,
quoting Eisenbarth at ¶46.
{¶93} Context also reinforces the conclusion that the Eisenbarth majority found
the 1989 ODMA ambiguous: the trial court used a fixed period; the Eisenbarths urged
a rolling look-back "meaning that the surface owner can pick any date" during the
effective dates of the 1989 ODMA; the Reussers argued a dead-letter law position,
"only one look-back period, looking back only from the effective date" of the 1989
ODMA; Eisenbarth at ¶36, 37, 39, with the majority further noting that "the three year
grace period would also have to be implemented." Id. at ¶42. Here, the Sheperds
propose a new calculation method, arguing for a trigger date based upon the date the
surface fee owner files a quiet title action, whereas the Tribetts argue akin to the
Eisenbarth majority's interpretation. The ambiguity of the 1989 ODMA speaks for
itself, despite the majority's assertion here to the contrary.
{¶94} The majority further contends that the legislative history of the 2006
ODMA cannot be used to interpret the meaning of the 1989 ODMA, reasoning that the
same members were not necessarily members of the General Assembly when each
version of the ODMA was enacted, and courts must first look to the language of the
statute itself. Majority, supra at ¶56, footnote 1. I disagree because I do not construe
R.C. 1.49 as narrowly as the majority.
{¶95} First noting that the majority did not argue that the language of the 2006
ODMA cannot be considered; of course, subsequent statutory language is an
appropriate analytical tool, perhaps the most reliable. The 2006 ODMA clarified the
ambiguities in the 1989 ODMA which gave rise to the Eisenbarth majority's question:
within the preceding twenty years of what? Majority, supra, at ¶59, quoting Eisenbarth
at ¶46. R.C. 1.49(D) identifies former statutes, including those of the same or similar
subjects as appropriate analytical tools. Typically, a court is presented with an
ambiguous statute in the first instance, and looks to, inter alia, the former version or
versions of the statute for guidance. Again, given the unique procedural history that
this ambiguous statute has presented itself, to wit, the ambiguity was resolved by the
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General Assembly without court intervention, it would be wholly consistent with R.C.
1.49(D) to look at the statutory language of the 2006 ODMA to interpret the 1989
ODMA.
{¶96} Second, R.C. 1.49 states that a court "may consider among other
matters" and then delineates six factors by way of example, not limitation, to consider
when construing legislative intent. Id.
Courts review several factors in order to glean the General Assembly's
intent, including the circumstances surrounding the legislative
enactment, the history of the statute, the spirit of the statute (the ultimate
results intended by adherence to the statutory scheme), and the public
policy that induced the statute's enactment.
State ex rel. Toledo Edison Co. v. Clyde, 76 Ohio St.3d 508, 513-14, 668 N.E.2d 498,
504 (1996), citing R.C. 1.49.
{¶97} Part of the 1989 ODMA history is in fact, the amendments made in the
2006 ODMA and the General Assembly's articulated reasons for doing so. R.C.
1.49(C) permits a court to consider "[t]he legislative history" without qualifier, hence the
holding in Clyde. Legislative history was not limited to merely the specific history of a
specific amendment. For example, interpreting Ohio's felony sentencing statutory
scheme, from merely 2000 to date, reveals a review of the legislative history
encompassing going backwards and forwards in time as the Ohio Supreme Court and
the General Assembly react to the others conclusion in the process when ambiguity is
raised.
{¶98} Nor is there any support in Ohio constitutional, statutory or common law
to support the majority's proposition that later sessions of the General Assembly can
modify anything done by a previous iteration of the body merely because it is not
constituted by the same membership, because no such authority exists; and its
placement in a footnote is indicative of the argument's merit.
The constitutional grant of authority at Section 1, Article II vests in the
General Assembly the plenary power to enact any law except those that
conflict with the Ohio or United States constitutions. State ex rel.
Jackman v. Cuyahoga Cty. Court of Common Pleas (1967), 9 Ohio St.2d
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159, 162, 38 O.O.2d 404, 224 N.E.2d 906. The General Assembly may
make amendments, or create exceptions, to previously enacted
legislation, such as forbidding things previously permitted, and it may
modify or entirely abolish common-law actions. Strock v. Pressnell
(1988), 38 Ohio St.3d 207, 214, 527 N.E.2d 1235; Thompson v. Ford
(1955), 164 Ohio St. 74, 79, 57 O.O. 96, 128 N.E.2d 111; Pohl v. State
(1921), 102 Ohio St. 474, 476, 132 N.E. 20, reversed on other grounds
by Bartels v. Iowa (1923) 262 U.S. 404, 43 S.Ct. 628, 67 L.Ed. 1047;
Washington Cty. Dept. of Human Servs. v. Rutter (1995), 100 Ohio
App.3d 32, 35, 651 N.E.2d 1360. Such legislative action is
constitutionally permitted because, although "[r]ights of property cannot
be taken away or interfered with without due process of law * * *[,] there
is no property or vested right in any of the rules of the common law, as
guides of conduct, and they may be added to or repealed by legislative
authority." Leis v. Cleveland Ry. Co. (1920), 101 Ohio St. 162, 128 N.E.
73, paragraph one of the syllabus.
Arbino v. Johnson & Johnson, 116 Ohio St.3d 468, 2007-Ohio-6948, 880 N.E.2d 420,
¶128.
{¶99} The Ohio Constitution has vested the General Assembly with the
exclusive, plenary authority to enact legislation. Specifically, it has exercised that
authority to clarify and correct an ambiguous statute, without intervention from the
judiciary. There is nothing in Ohio constitutional, statutory or common law which
requires that the courts must first address a statutory ambiguity; that the General
Assembly cannot recognize and correct the ambiguity on its own accord. To so hold
interferes with a separate branch's constitutionally defined authority.
{¶100} Viewed from the perspective that the 2006 ODMA is in effect, along with
the General Assembly's expressed reasons for making the amendments in that
version, and that statutes in derogation of common law must be strictly construed to
preserve individual property rights, the phrase 'deemed abandoned and vested' in R.C.
5301.56(B)(1), should be construed as defining an inchoate right. Eisenbarth at ¶69.
(DeGenaro, P.J. concurring in judgment only).
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{¶101} The 2006 version of R.C. 5301.56 does what the General Assembly
intended the 1989 ODMA to do but failed to achieve: balance the complementary
policy goals of creating a reliable record chain of title via the Ohio Marketable Title Act
(OMTA) statutory scheme—which includes the ODMA—and facilitate economic use of
mineral rights. The Ohio General Assembly recognized that the 1989 ODMA had
technical problems and was thus seldom used. Specifically, the 1989 ODMA failed to
define how to calculate the 20 year look-back period before allowable vesting can
occur—to use the General Assembly's verbiage—and define the process to reunite the
interests in the surface owner. The 2006 ODMA corrected inoperable, not merely
ambiguous, statutory language. The current version of R.C. 5301.56 not only clarifies
the process, it specifies the look-back period trigger and mandates notice to the holder
before the mineral rights are deemed abandoned; only then can allowable vesting
occur with the surface owner. Eisenbarth at ¶70. (DeGenaro, P.J. concurring in
judgment only).
{¶102} Given the Ohio General Assembly's expressed purpose of the 2006
ODMA and the clear, unambiguous language of its modifications, the majority
incorrectly continues to follow the recent trilogy of cases from this district, and
determine the parties' interests to the severed mineral rights pursuant to the 1989
ODMA. As the Sheperds timely recorded a claim to preserve the severed mineral
rights under the 2006 ODMA, R.C. 5301.56(H), they continue to hold that interest.
Thus, I concur in the ultimate conclusion that the Sheperds did not abandon their
mineral rights and would reverse the trial court, but do so pursuant to the 2006 ODMA.
Eisenbarth at ¶118. (DeGenaro, P.J. concurring in judgment only).
The 1989 ODMA is Unconstitutional
{¶103} This is the first time the constitutionality of the 1989 ODMA has been
properly before this court for consideration, and arguably, resolution of the issue could
make the above analysis moot. I disagree with the majority's reliance on Texaco as
well as the conclusion that the 1989 ODMA is constitutional. Discussion of Texaco
necessitates consideration of the Supreme Court's constitutional analysis of Indiana's
Act juxtaposed with Ohio's heightened protection of private property rights relative to
the federal and Indiana constitutions. Ohio more vigorously protects its citizens'
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private property rights by statute than Indiana does, and additionally, the Ohio
Constitution affords more protection to property owners than either the Indiana or
federal constitutions, thus the decision in Texaco has no precedential value in Ohio.
The ODMA presently is not, nor was actually or intended to be, self-executing. More
importantly, to construe it as such runs contrary to the Ohio Constitution's declaration
that property rights in this state are inalienable and inviolate.
{¶104} A fee simple interest—which includes severed mineral rights—under
common law "cannot be extinguished or abandoned by nonuse, and it is not necessary
to rerecord or to maintain current property records in order to preserve an ownership
interest in minerals."3 An individual's vested right—created by common law or
statute—has been generally defined by the Ohio Supreme Court as being in essence
a property right, to be recognized and protected by the state from arbitrary deprivation;
a vested right is more than a mere expectation or interest in the continuity of current
common or statutory law; because it completely and definitely belongs to the individual
it cannot be impaired or divested absent the individual's consent. State ex rel. Jordan
v. Indus. Comm., 120 Ohio St.3d 412, 2008-Ohio-6137, 900 N.E.2d 150, ¶9; Walker,
¶40. The legal weight a vested right carries is reinforced by the axiom ingrained in
Ohio common law that forfeiture is not favored in law or in equity. State ex rel. Lukens
v. Indus. Comm., 143 Ohio St. 609, 611, 56 N.E.2d 216 (1944).
{¶105} As a preliminary observation, it appears that Indiana's Act remains
unchanged with respect to its notice provisions, presumably since the U.S. Supreme
Court in Texaco held the Act did not violate federal constitutional principles, affirming
the Indiana Supreme Court's decision in Short v. Texaco, Inc., 273 Ind. 518, 406
N.E.2d 625 (1980) that the self-executing statutory abandonment is constitutionally
enforceable.
{¶106} Substantively, the language of the Indiana Act is unequivocal, and lends
itself to an interpretation that vesting is automatic. Ind.Code 32-23-10-2 provides: "An
interest in coal, oil and gas, and other minerals, if unused for a period of twenty (20)
3
Dahlgren v. Brown Farm Props., LLC., Carroll C.P. No. 2013 CVH 274455, *8, quoting the
Prefatory Note of the Uniform Dormant Interests Act, approved by the National Conference of
Commissioners on Uniform State Laws in 1986, approved by the A.B.A. on February 16, 1987.
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years, is extinguished and the ownership reverts to the owner of the interest out of
which the interest in coal, oil and gas, and other minerals was carved. However, if a
statement of claim is filed in accordance with this chapter, the reversion does not
occur." (Emphasis added.) Id. As discussed in Eisenbarth, this language is
consistent with other portions of the OMTA which uses terms such as 'null and void' or
'extinguished' and arguably warrants an automatic characterization, unlike the qualified
phrase in R.C. 5301.56 'deemed abandoned and vested,' which should not be
construed as having similar automatic effect. Id. at ¶85, 94 and 100. (DeGenaro, P.J.
concurring in judgment only).
{¶107} In contrast to the Indiana Act, the Ohio General Assembly amended
R.C. 5301.56 to clarify when a mineral interest became abandoned and delineate the
exact process to reunite the severed mineral interest with the surface fee. Central to
the modifications in the 2006 ODMA is that in all instances before any allowable
vesting can occur, the surface owner must notify the holder of the severed mineral
rights of the owner's intention to declare the rights abandoned, even in the absence of
a saving event within the now clearly defined look-back period, in order to afford the
holder one final opportunity to preserve their mineral rights from abandonment. R.C.
5301.56(E)(2) and (G). Even where the holder failed to engage in one of the
statutorily defined actions to preserve their mineral rights, including merely filing an
affidavit preserving those rights, the Ohio General Assembly gave the holder 60 days
to, in essence, revive their mineral interest. This is the antithesis of a self-executing
statute. Moreover, that the 1989 ODMA was not, nor intended to be, self-executing is
evident from the testimony of the 2006 ODMA sponsor and the Legislative Services
final bill analysis, discussed in Eisenbarth at ¶108-115. (DeGenaro, P.J. concurring in
judgment only). This vigorous statutory protection stands in stark contrast with
Indiana's Act.
{¶108} Ohio's General Assembly seized the opportunity to clarify its intent and
correct R.C. 5301.56, thereby statutorily rejecting Texaco. Here, by measuring R.C.
5301.56 against federal constitutional standards—and not Ohio constitutional
standards—the majority has created a forfeiture of what were heretofore private
property rights protected at common law from extinguishment by abandonment or
-34-
nonuse; under the common law affirmative action was required by the mineral rights
holder before they could be divested of their interest. This is in direct contravention of
the General Assembly's express decision to give Ohio citizens more statutory
protection than the Indiana Legislature affords its citizens.
{¶109} Thus, Texaco has no bearing on which version of R.C. 5301.56 controls
disputes over ownership of mineral rights brought after the Act's June 30, 2006
effective date, particularly the issue of whether the 1989 ODMA is unconstitutional
when measured against Ohio's constitution.
{¶110} Ohio's vigorous statutory protection, when contrasted with the Indiana
Act, is rooted in Ohio's heightened constitutional protection of private property rights.
"All men are by nature, free and independent, and have certain inalienable rights,
among which are * * * acquiring possessing, and protecting property" Ohio
Constitution, Article I, Section 1. "Private property shall ever be held inviolate." Ohio
Constitution, Article I, Section 19. The Ohio Supreme Court has described the extent
of this right as follows:
"The right of private property is an original and fundamental right,
existing anterior to the formation of the government itself[.] *** The right
of private property being, therefore, an original right, which it was one of
the primary and most sacred objects of government to secure and
protect[.] *** In light of these Lockean notions of property rights, it is not
surprising that the founders of our state expressly incorporated individual
property rights into the Ohio Constitution[.] *** Ohio has always
considered the right of property to be a fundamental right. There can be
no doubt that the bundle of venerable rights associated with property is
strongly protected in the Ohio Constitution and must be trod upon lightly,
no matter how great the weight of other forces."
(Emphasis in original, internal citations omitted). City of Norwood v. Horney, 110 Ohio
St.3d 353, 2006-Ohio-3799, 853 N.E.2d 1115, ¶36-38.
{¶111} The distinction between federal versus Ohio property rights in eminent
domain jurisprudence is instructive here. In Norwood, the Ohio Supreme Court held
that the Taking Clause under the Ohio Constitution affords greater protection than the
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U.S. Constitution, refusing to extend the holding in Kelo v. City of New London, 545
U.S. 469, 488–90, 125 S.Ct. 2655, 162 L.Ed.2d 439 (2005)—that economic
development alone constitutes public purpose under federal eminent domain
jurisprudence—as inconsistent with Ohio constitutional jurisprudence.
Writing for a unanimous Court in Norwood, then Justice O'Connor noted:
Although it determined that the Federal Constitution did not prohibit the
takings, the court acknowledged that property owners might find redress
in the states' courts and legislatures, which remain free to restrict such
takings pursuant to state laws and constitutions.
In response to that invitation in Kelo, Ohio's General Assembly
unanimously enacted 2005 Am.Sub.S.B. No.167. The legislature
expressly noted in the Act its belief that as a result of Kelo, "the
interpretation and use of the state's eminent domain law could be
expanded to allow the taking of private property that is not within a
blighted area, ultimately resulting in ownership of that property being
vested in another private person in violation of Sections 1 and 19 of
Article I, Ohio Constitution." Section 4(A), 2005 Am.Sub.S.B. No. 167.
Id. at ¶5-6.
{¶112} It is noteworthy that the General Assembly, perhaps in response to Kelo
but at a minimum, recognizing the inoperability of the 1989 DMA, likewise seized the
opportunity to clarify its intent and correct R.C. 5301.56. More importantly, the
clarifications and amendments in the 2006 version brought the ODMA into compliance
with Ohio constitutional law. See Eisenbarth at ¶108-115. (DeGenaro, P.J.,
concurring in judgment only). The General Assembly recognized that the 1989 ODMA
"did not clearly define when a mineral interest became abandoned and exactly how the
process to reunite the mineral ownership with the surface ownership was to be
accomplished." H.B. 288 Rep. Mark Wagoner, Sponsor testimony before the Ohio
House Public Utilities Committee. The 2006 ODMA removed the ambiguity and
potentially arbitrary operation of the 1989 version by clearly defining the triggering
event to commence a 20 year look-back period and requiring notice to the mineral
rights holder before seeking abandonment, including enabling the holder to revive a
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possibly abandoned interest. R.C. 5301.56(H). As a result, the General Assembly's
express purposes of: (1) requiring recording all interests to facilitate a searchable
chain of title in real property in general, and mineral rights specifically; and (2)
encouraging economic mineral production without violating inalienable property rights
were achieved.
{¶113} Further, "[t]o be truly in the public welfare within the meaning of [Ohio
Constitution, Article I, Section 19] and thus superior to private property rights, any
legislation must be reasonable, not arbitrary, and must confer upon the public a benefit
commensurate with its burdens upon private property." Direct Plumbing Supply Co. v.
City of Dayton, 138 Ohio St. 540, 546, 38 N.E.2d 70 (1941). The public benefit of the
ODMA is to create a chain of title with respect to ownership of severed mineral rights
in order to facilitate the economic development of those minerals. However, to
facilitate that end by construing the 1989 ODMA as automatically divesting the holder
of their severed mineral rights without notice imposes an undue burden upon those
private property rights. Moreover, the 1989 ODMA failed to facilitate economic
development of mineral interests, as acknowledged by the General Assembly in
enacting the 2006 ODMA.
{¶114} Applying the majority's rationale, the Tribetts' have owned the mineral
rights by virtue of the 1989 ODMA automatically vesting them with the formerly
severed interest since March 22, 1992. Yet, the Tribetts failed to further the public
benefit of oil and gas development by doing nothing with the mineral rights from 1992
through April, 2012, when they filed the quiet title action, merely filing a notice of
abandonment pursuant to the 2006 ODMA. Thus, their inaction with respect to
developing the mineral interest is equal to that of the Shepherds. To favor the Tribetts'
inaction over the Shepherds' condones arbitrary action that cannot justify violating the
Shepherds' constitutionally protected property rights.
{¶115} Moreover, at least four other state supreme courts have found their
dormant mineral statutes unconstitutional pursuant to their respective state
constitutions, because each state's act, like Ohio's as interpreted by the prior case
trilogy and the majority here, operated as a forfeiture on the severed mineral interest
holder, because reversion with the surface fee occurred automatically without prior
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notice or hearing. Wilson v. Bishop, 82 Ill.2d 364, 412 N.E.2d 522 (1980); Contos v.
Herbst, 278 N.W.2d 732 (Minn.1979); Wheelock v. Heath, 201 Neb. 835, 272 N.W.2d
768, (1978); Chicago & N.W. Transp. Co. v. Pedersen, 80 Wis.2d 566, 259 N.W.2d
316 (1977). The rationale applied by all four courts has been summarized by the
Illinois Supreme Court in Wilson:
The Act declares that any severed interest in oil and gas shall be
deemed abandoned unless the record owner, within a period of 25 years,
engages in the actual production of oil or gas, publicly exercises
specified acts of ownership by means of instruments recorded in the
office of the recorder of deeds for the county wherein the interest is
located, or files with the county recorder a written claim of interest within
3 years after the effective date of the Act or within 25 years from the last
public act of ownership, whichever is later. If a written claim of interest is
recorded, ownership of the interest is preserved only for the next 25
years. In the absence of one of the required acts, a statutory
abandonment occurs and the severed interests automatically vest in the
surface owners.
The statute provides no notice of any kind to record owners of oil
and gas interests that they must record a statement of their interest in
order to prevent the forfeiture of their property interests. While we
recognize the beneficial purpose of the statute to facilitate the production
of existing oil, gas and other mineral resources, particularly where
ownership of the interests has become increasingly fractionalized and
scattered, the record owners are vested with property interests entitled to
the procedural safeguards of due process. Failure to provide those
owners with adequate notice and an opportunity to be heard renders the
statutory scheme unconstitutional.
When faced with similar statutes, the courts in other States have
reached like conclusions. In Wheelock v. Heath (1978), 201 Neb. 835,
272 N.W.2d 768, the statute declared that severed mineral interests
would be deemed abandoned unless the record owner publicly exercised
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defined ownership rights within a period of 23 years or asserted his
interest in an action filed within 2 years after the effective date of the
statute. In Chicago & North Western Transportation Co. v. Pedersen
(1977), 80 Wis.2d 566, 259 N.W.2d 316, the statute provided for the
reversion of severed mineral interests to the surface fee owner unless
the owner of the mineral interests registered his ownership and paid an
annual registration fee. In Contos v. Herbst (Minn.1979), 278 N.W.2d
732, the statute provided for the forfeiture of severed mineral interests to
the State unless the record owner filed a registration statement. In both
Wheelock and Pedersen, the forfeiture occurred without any notice,
hearing or compensation to the record owner. The statute in Contos
provided for notice by publication in a legal newspaper within each
county, apparently in three issues, and in two mining publications with a
nationwide circulation, and it provided for compensation following
forfeiture. The court, however, found that notice by publication of the
statutes alone was inadequate and concluded: "We cannot imagine a
more clear violation of due process than the failure to provide a hearing
before forfeiture." 278 N.W.2d 732, 743, citing Mullane v. Central
Hanover Bank & Trust Co. (1949), 339 U.S. 306, 70 S.Ct. 652, 94 L.Ed.
865.
Wilson, 82 Ill.2d at 370-71, 412 N.E.2d at 525.
{¶116} By measuring the 1989 ODMA against federal, rather than Ohio
constitutional property rights standards and declaring it a constitutional self-executing
statute, the majority has created a forfeiture of inviolate private property rights in
contravention of Ohio constitutional jurisprudence. The 1989 ODMA's lack of notice
provisions makes it unconstitutional on its face, and by construing it as a self-
executing statute resulting in automatic abandonment of a severed mineral interest by
the holder and vesting that interest in the surface fee owner, the 1989 ODMA is
unconstitutional as applied. Such a statutory construction results in an unlawful taking
by operation of law, proscribed by Ohio Constitution, Article I, Sections 1 and 9, as
construed by the Ohio Supreme Court in Norwood.
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Look-back Period Based Upon Case Specific Trigger
{¶117} Assuming arguendo the 1989 ODMA controls, in construing the
meaning of the ambiguous phrase 'preceding 20 years,' I disagree with the parties' and
the majority's characterization of the look-back period as either rolling or fixed. I
interpret this holding as creating a bright-line rule. Instead, determination of whether a
severed mineral interest has been abandoned must be decided on a case by case
basis, to determine whether an initial savings event occurred within the original
statutory 20 year period, to trigger a successive 20 year period in order to preserve the
severed mineral interest. The provision in R.C. 5301.56(D)(1) delineating the process
for preserving severed mineral rights for successive terms signals the General
Assembly's intention that in order to preserve that interest, every 20 years a savings
event must occur, or the holder must file a claim to preserve, in order to retain their
interest for another 20 years. Eisenbarth at ¶122-124. (DeGenaro, P.J. concurring in
judgment only).
{¶118} R.C. 5301.56(D)(1) provides that the holder of severed mineral rights
can preserve their mineral rights indefinitely by filing successive claims for successive
20 year periods. R.C. 5301.56(B)(1)(c)(v), 1988 S 223, eff. 3-22-89 (a mineral interest
will not be deemed abandoned if within the preceding 20 years a claim to preserve has
been filed pursuant to division (C)(1) of the statute). Because R.C. 5302.56(D)(1)
refers to successive filings, the 1989 ODMA contemplates that the holder of severed
mineral rights was required to renew that interest of record every 20 years.
{¶119} Here, the original severance and reservation of the mineral rights in the
1962 deed conveying the surface fee and coal interests to Seaway Coal was the
subject of a title transaction contemplated by R.C. 5301.56(B)(1)(c)(i), and thus a
savings event which, in theory, would have preserved the mineral rights for an initial
statutory 20 year period. But this calculation cannot apply here because this event
occurred beyond the 20 year look-back period from the effective date of the 1989
ODMA, specifically 1969. Thus, a claim to preserve had to be recorded within the
statutory three year grace period, specifically by March, 1992. Thus, the Sheperds or
their predecessors in interest were required to record a claim to preserve before the
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initial statutory 20 year period expired in March, 1992, in order to preserve their
mineral rights for another 20 year period, which they failed to do.
{¶120} Applying the rationale that the 1989 ODMA is controlling and an
automatic self-executing statute, the October, 2011 claim to preserve cannot constitute
a savings event for the Sheperds because they were no longer the holders of mineral
rights that could be preserved as of that date. Those severed mineral rights
automatically vested and reverted to the Tribetts' predecessors in interest in 1992 by
operation of the 1989 ODMA, 19 years earlier. Only the 2006 ODMA provides a 60
day window for a mineral rights holder to preserve their interest where, as here, the
holder has been notified that there has been a gap in excess of 20 years from a
preceding savings event. Id. at ¶121. (DeGenaro, P.J. concurring in judgment only).
The majority has correctly acknowledged in its alternative holding that, in the event the
Ohio Supreme Court determines the 1989 ODMA does not apply, only the 2006
ODMA affords a severed mineral holder these protections, and in that event, the
Sheperds preserved their mineral interest, pursuant to our decision in Dodd, supra.
Majority, supra, at ¶76. And pursuant to the 2006 ODMA, that interest is preserved
through October, 28, 2032.
{¶121} Operating under this rationale, the original statutory period in this case
ran from March 1969 through March 1992. Because no savings event occurred during
that time period to create a second, successive 20 year period, the Sheperds' severed
interest had been reunited with the surface fee in 1992 by operation of the 1989
ODMA. Accordingly, the majority has correctly concluded that title to the mineral rights
should be quieted in the Tribetts.
{¶122} As an aside, an inconsistency regarding the continued applicability of
the 1989 ODMA has arisen in this district. First, in Dodd, the August 5, 2009
Survivorship Deed, through which the Dodd's acquired their surface fee interest, stated
that the mineral rights were severed in 1947, and that there were no further
transactions. Id. at ¶4. Applying the 2006 ODMA, we found that there were no
savings events within the 20 years preceding the Dodd's recorded notice of
abandonment, but because the Croskey's filed a timely claim to preserve, we held they
retained the severed mineral rights. Id. at ¶49-50, 68. In the course of the analysis,
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discussing Riddel v. Layman, 5th Dist. No. 94CA114, (1995), we noted in Dodd that
the Ninth District resolved that case based upon the previous version of the ODMA
"that was in effect at the time" Id., ¶46, demonstrating an awareness of the 1989
ODMA. Dodd did not apply the 1989 ODMA, for if we had, the Croskeys' mineral
rights would have been held to be automatically reunited with the Dodds' surface fee
interest in 1992 by operation of the 1989 ODMA. The claim to preserve the Dodds
recorded in 2010 in that case was filed 18 years after those interests had reverted to
the Croskeys, the last title transaction involving the mineral interest was when they
were originally severed from the surface fee in 1947.
{¶123} When the argument was raised in Swartz, supra, that Dodd did not
address the 1989 ODMA, suggesting a sub silentio determination that the 1989 ODMA
did not apply, the Swartz panel rejected that argument, noting that the parties in Dodd
did not raise any arguments regarding the 1989 ODMA but only the 2006 ODMA, and
then reasoning: "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." Swartz at ¶17. This reasoning is flawed for two reasons. First, Swartz
itself undercut that rationale because it concluded that the 1989 ODMA was
dispositive, as did Walker before it and again after in Eisenbarth. Secondly,
[A]n appellate court will affirm on other grounds a legally correct
judgment, reasoning that no prejudice results from the trial court
reaching the right result albeit for the wrong reason. Reynolds v. Budzik,
134 Ohio App.3d 844, 732 N.E.2d 485, fn. 3 (6th Dist.1999) fn. 3, citing
Newcomb v. Dredge, 105 Ohio App. 417, 424, 152 N.E.2d 801 (2d
Dist.1957); State v. Payton, 124 Ohio App.3d 552, 557, 706 N.E.2d 842(1997).
Moreover, "an appellate court is bound to affirm a trial court's
judgment that is legally correct on other grounds regardless of the
arguments raised or not raised by the parties." State v. Helms, 7th Dist.
No. 08 MA 199, 2013-Ohio-5530, ¶10 (Vukovich, J. concurring), citing
State v. Ingram, 9th Dist. No. 25843, 2012-Ohio-333, ¶7.
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Eisenbarth at ¶121. (DeGenaro, P.J. concurring in judgment only).
{¶124} Dodd was an appeal from summary judgment and our standard of
review was de novo. Id. at ¶12. Thus, we were not bound by the parties' arguments in
Dodd, we were obligated to apply the correct law regardless of the conclusions of the
trial court or the parties. Eisenbarth at ¶121. (DeGenaro, P.J. concurring in judgment
only).
{¶125} Returning to the inconsistency concern, in Walker, Swartz and
Eisenbarth the only way for the severed mineral interest holder to retain ownership of
that interest was for this court to conclude that the 2006 rather than the 1989 ODMA
controlled. In Walker and Swartz, although no savings event occurred during the
effective dates of the 1989 ODMA, Walker at ¶2, Swartz at ¶5, 8, the mineral interest
holders recorded claims to preserve their interest pursuant to the 2006 ODMA in
response to the notices of abandonment recorded by the surface fee holders in 2011.
Walker at ¶5-6, Swartz at ¶2, 6. The panels in Walker and Swartz held the severed
mineral interests all automatically reverted to the surface fee owners by operation of
the 1989 ODMA, Walker at ¶41, Swartz at ¶27, with the panel in Walker refusing to
address the holder's 2006 ODMA arguments, Walker at ¶31-34, and the panel in
Swartz concluding that they would not address the argument that the 2011 claims to
preserve recorded in that case were effective, reasoning that "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." Id. at ¶47.
{¶126} But with an identical fact pattern to Walker and Swartz, the Eisenbarth
majority reached the opposite conclusion, and permitted the severed mineral interest
holder to avail themselves of the 2006 ODMA to retain that interest. In Eisenbarth, the
panel was unanimous in holding that a recorded oil and gas lease over the severed
mineral rights can be a savings event, Id. at ¶32, and two leases were executed, one
in 1974 and the other in 2008. Id. at ¶5, 8. However, the panel diverged on the effect
of each lease. While its reasoning is unclear, the Eisenbarth majority, reiterating the
automatic self-executing character of the 1989 ODMA, Id. at ¶9, footnote 1, held that
the mineral interest holder retained the mineral rights. Id. at ¶46-51. Assuming
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arguendo that the 1989 ODMA controlled, the Eisenbarth minority opinion reached the
opposite conclusion, reasoning:
Because R.C. 5302.56(D)(1) refers to successive filings, the 1989
ODMA contemplated that the holder of severed mineral rights was
required to renew that interest of record every 20 years. Thus, the
Reussers were required to make some kind of successive filing before
the initial 20 year period expired. Because they failed to do so, by
operation of the 1989 ODMA, the severed mineral rights reverted back to
the Eisenbarths on January 24, 1994. Applying the majority's rationale
that the 1989 ODMA is an automatic self-executing statute, the 2008 oil
and gas lease cannot constitute a savings event for the Reussers
because they were no longer holders of mineral rights that could be
preserved as of that date.
Eisenbarth at ¶66. (DeGenaro, P.J. concurring in judgment only).
{¶127} Next, in Farnsworth v. Burkhart, 7th Dist. No. 13 MO 14, 2014-Ohio-
4184, (Sept. 22, 2014), as in Swartz, the only way for the severed mineral interest
holder to retain ownership of that interest was for this court to conclude that the 2006
rather than the 1989 ODMA controlled. In Farnsworth, no savings event occurred
during the effective dates of the 1989 ODMA, yet the majority relied upon a claim to
preserve recorded pursuant to the 2006 ODMA to hold that the severed mineral
interest holders still retained that interest. Again, assuming arguendo that the 1989
ODMA controlled, the minority opinion held that the severed mineral interest reverted
to the surface fee owner: "the Burkharts were no longer holders of mineral rights that
could be transferred or preserved as of 2012, because the severed interest had been
reunited with the surface fee in 2000." Farnsworth at ¶71. (DeGenaro, P.J. concurring
in judgment only). Finally, in this case, the majority holds that the severed mineral
interest is automatically reunited with the surface fee by operation of the 1989 ODMA,
but in the event the Ohio Supreme Court holds otherwise, the severed mineral interest
holder would retain that interest in light of the timely claim to preserve which was
recorded pursuant to the 2006 ODMA. Majority, supra at ¶76.
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{¶128} Thus we have a divergence of outcomes in this district where the
severed mineral interest reunited by operation of the 1989 ODMA. In Swartz, Walker
and in this case, the majority refused to permit the severed mineral interest holder to
avail themselves of the 2006 ODMA and retain the interest as a result of a recorded
claim to preserve, whereas in Dodd, Eisenbarth and Farnsworth, the severed mineral
interest holders were able to avail themselves of the 2006 ODMA and preserve their
interest. This discrepancy in outcome must be reconciled.
Conclusion
{¶129} While feigning to engage in statutory construction in order to decipher
what the General Assembly meant by 'deemed abandoned and vested,' 'preceding 20
years' and 'successive' makes for interesting academic writing or a law school exam
question, to do so here is disingenuous. The timing of the enactment of both versions
of the ODMA has presented Ohio's judiciary with a rare opportunity; virtually every
case involving the statute has been filed after the amendments to the ambiguous
statute have been enacted. Instead of engaging in the typical exercise of divining
legislative intent by reading the proverbial tea leaves, the General Assembly has
provided us with a billboard of the meaning of these terms by virtue of sponsor
testimony and Legislative Services' analysis of the 2006 ODMA, let alone the express
statutory language of R.C. 5301.56 the General Assembly enacted.
{¶130} Yet the majority has chosen to ignore the existence of the 2006 version
and construe the 1989 version in a vacuum. This defies logic and the canons of
statutory construction, a cornerstone judicial interpretive tool created and followed to
honor the principle of separation of power and balance the respective constitutionally
defined roles of the legislative and judicial branches. The Ohio Constitution has
vested the General Assembly with the exclusive, plenary authority to enact legislation.
Specifically, it has exercised that authority to clarify and correct an ambiguous statute,
without intervention from the judiciary. There is nothing in Ohio constitutional,
statutory or common law which requires that the courts must first address a statutory
ambiguity; that the General Assembly cannot recognize and correct the ambiguity on
its own accord. To so hold interferes with a separate branch's constitutionally defined
authority.
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{¶131} More importantly, the 1989 ODMA's lack of notice provisions makes it
unconstitutional on its face, and by construing it as a self-executing statute resulting in
automatic abandonment of a severed mineral interest by the holder and vesting that
interest in the surface fee owner, the 1989 ODMA is unconstitutional as applied. Such
a statutory construction results in an unlawful taking by operation of law, proscribed by
Ohio Constitution, Article I, Sections 1 and 9, and as construed by the Ohio Supreme
Court. Thus, the 1989 ODMA is unenforceable.
{¶132} Accordingly, the trial court's decision should be reversed, and title to the
severed mineral rights quieted in the Shepherds.