Kocher v. Ascent Resources-Utica

225 N.E.3d 528

2023-Ohio-3592

Susan KOCHER et al., Plaintiffs- Appellants,

v.ASCENT RESOURCES-UTICA, LLC et al., Defendants-Appellees.

Case Nos. 22 JE 0012, 22 JE 0014

Court of Appeals of Ohio, Seventh District, Jefferson County.

September 28, 2023

Civil Appeals from the Court of Common Pleas of Jefferson County, Ohio, Case No. 20 CV 82.

Atty. Sean Richard Scullin, Scullin & Cunning, LLC, 940 Windham Ct., Ste. 4, Boardman, Ohio 44512, for Appellants Susan Kocher et al., Atty. Joshua E. O’Farrell, Atty. Jude B. Streb, Atty. Justin S. Greenfelder, Buckingham, Doolittle & Burroughs LLC, 4277 Munson, Street, NW, Cantop, Ohio 44718 for Appellant Bedway Land and Minerals Co..

Atty. Kevin L. Colosimo, Atty. Christopher W. Rogers, Frost Brown Todd LLC, Union Trust Building, 501 Grant Street, Suite 800, Pittsburgh, PA 15219 for Appellee Ascent Resources-Utica, LLC.

Atty. Jeffrey J. Bruzzese, Bruzzese, Hanlin & Bruzzese, LLC, 100 N. 4^th Street, 10 Floor, P.O. Box 1506, Steubenville, Ohio 43952 for Appellees James T. Banal Jr. et al.

Atty. J. Zachary Zatezalo, Bordas & Bordas, PLLC, 526 Seventh Street, Moundsville, West Virginia 26041 for Appellees James and Rebecca Mills.

BEFORE: Carol Ann Robb, Cheryl L.

Waite, David A. D’Apolito, Judges.

OPINION AND JUDGMENT ENTRY

Robb, J.

{¶1} These consolidated appeals concern the ownership of oil and gas rights underlying 102¹ acres of real property in Jefferson County. Appellants filed suit seeking quiet title to the oil and gas rights and named the surface owners of the real property as defendants.

{¶2} The trial court ultimately granted Appellees, the surface owners, summary judgment as a matter of law and found Appellants’ interests in the underlying oil and gas rights, if any, were extinguished via the Marketable Title Act (MTA). It quieted title in Appellees’ favor and determined Appellees own 100% of the oil and gas mineral interest, underlying the property. The trial court did not address the parties’ claims and arguments arising from the Dormant Mineral Act (DMA). (July 26, 2022 Order,)

{¶3} For the following reasons, the trial court’s decision is reversed in part, affirmed in part, and the case remanded for further proceedings.

Statement of the Case

{¶4} Appellants, Susan Kocher et al., consist of 81 individuals and one company, Bedway Land and Minerals Co. (Bedway), who are alleged heirs, successors, assigns, and holders of the mineral interests underlying six parcels of real property. Appellants filed suit in February of 2020. They filed their first amended complaint in November of 2020 and their second amended complaint on February 1, 2021.

{¶5} Appellants’ second amended complaint named as defendants, Ascent Resources-Utica, LLC (Ascent), James M. and Rebecca L. Mills (the Mills defendants), Heather C. Mazey, Trustee of the Fashing Family Irrevocable Trust, James T. and Maria S. Banal, L.D. Jenkins, Mary L. Gorman, and Norman T. Fashing and Joyce K. Fashing, as Co-Trustees of the Norman T. Fashing and Joyce K. Fashing Family Trust (collectively the Fashing defendants). Appellants claim Ascent, L.D. Jenkins, and Mary L. Gorman may claim to have an interest in this lawsuit. Appellants contend the other named defendants are surface owners of the six parcels at issue and they wrongfully leased the attendant mineral rights underlying then respective real properties. (February 1, 2021 Second Amended Complaint.)

{¶6} Appellees moved to dismiss certain claims, contending each was a remedy and not a cause of action. The trial court agreed and dismissed four counts of Appellants’ complaint. Appellants do not challenge this decision on appeal. The remaining counts after the motion to dismiss include the following.

{¶7} The first count in Appellants’ second amended complaint sought declaratory judgment and a determination that Appel- lants are the owners of the mineral interests underlying the property. Appellants’ second count seeks to quiet title the ownership of the property’s mineral interests in their favor as owners or holders. Appellants’ third count asserts an unjust enrichment claim. (February 1, 2021 Second Amended Complaint.)

{¶8} In their prayer for relief, Appellants sought declaratory judgment finding defendants failed to comply with the Dormant Mineral Act; an order quieting title in their favor to the mineral rights; arid an order for an accounting of and imposition of a constructive trust for all funds received from the minerals, including royalties, and any other relief deemed necessary. (February 1, 2021 Second Amended Complaint.)

{¶9} The Mills defendants, surface owners of one of the parcels, counterclaimed to quiet title in their favor regarding the respective mineral rights. In January of 2013, the Mills filed an affidavit of abandonment, contending as surface owners that the prior reservations of mineral rights regarding their real property had been abandoned. (February 1, 2021 Second Amended Complaint, Exhibit E.)

{¶10} The Fashing defendants likewise counterclaimed and sought declaratory judgment and to quiet title in their favor. (July 2, 2020 Second Amended Answer & Counterclaim.) In December of 2013, the Fashings filed two affidavits of abandonment and averred the mineral exceptions and reservations regarding their surface estates had been abandoned. (Second Amended Complaint, Exhibit F & G.)

{¶11} After the exchange of discovery, the parties filed competing motions for summary judgment. The Fashing defendants moved for summary judgment in their favor, contending in part the 1957 Rembish deed is their root of title and that it does not contain an oil or gas reservation or exception. They also alleged the Rembish deed did not repeat a prior reservation or exception. They alleged their predecessor in interest, Bedway, acquired title to the 102 acres from ten co-owners of the property or co-tenants. The Fashing defendants alleged that Appellants’ claims to the mineral rights were extinguished via the MTA in light of their unbroken chain of title in the land for more than 40 years, and because Appellants’ claims stem from transactions before the 40-year period, these interests were extinguished as a matter of law. As for any alleged savings events, the Fashing defendants claimed the title transactions were general, not specific, and thus do not constitute savings events. Alternatively, they argued Appellants’ interests, if any, were abandoned under the DMA. (June 4, 2021 Summary Judgment Motion.)

{¶12} The Mills defendants’ response to summary judgment also claimed the February 4,1957 Rembish deed was their root of title and showed they were the record title owners to the mineral rights. They alleged the Rembish deed met the substantive aspect of the root of title definition. The Mills defendants argued, because the real property was jointly owned by nine owners, Wilmetta Belon’s conveyance to Bedway of a 1/10 interest had the effect of conveying an "undivided share and had the right of possession of the whole of the surface and mineral rights." And since the real property was not physically divided, she, as one co-tenant, had the right to lease oil and gas mineral production for the entirety of the tract. (July 16, 2021 Response to Summary Judgment.)

{¶13} Appellants urged the trial court to find that neither the MTA nor the DMA applied and their mineral interests were still viable. Regarding the Appellees’ MTA arguments, Appellants contended the Rembish deed was not a proper root of title for several reasons. And regarding the DMA, Appellants claimed the surface owners failed to conduct a diligent search before resorting to notice by publication and that, regardless, there were timely notices to preserve recorded. (June 4, 2021 Summary Judgment Motion.)

{¶14} The trial court held a hearing on the cross motions for summary judgment and issued its decision on July 26, 2022. The trial court dismissed Appellants’ unjust enrichment claim at the hearing. (August 9, 2021 Tr. p. 43.) Appellants do not challenge the dismissal of this claim on appeal.

{¶15} The trial court granted summary judgment in favor of Appellees, the surface owners, and found pursuant to the MTA, Appellees had unbroken chains of title from the recording of the Rembish deed to the present and Appellants’ interests were extinguished by operation of law. (July 26, 2022 Order.)

{¶16} Appellants, Susan Kocher et al., the individuals and alleged heirs, successors, and assigns of the properties’ mineral interests, appealed the July 26, 2022 summary judgment decision, and Appellant Bedway separately appealed. We consolidated the appeals in response to their joint request. Appellants raise five assignments of error.

Standard of Review

[1, 2] {¶17} The interpretation of deeds is generally a question of law for a court to decide. Courts are to employ rules of contract construction to interpret deeds and focus on a plain reading of the words in the four corners of the document. McGiffin v. Skurich, 2021-Ohio-2741, 176 N.E.3d 833, ¶ 20 (7th Dist.), citing Long Beach Assn., Inc. ?. Jones, 82 Ohio St.3d 574, 576, 697 N.E.2d 208 (1998), and LRC Realty, Inc., ?. B.E.B. Properties, 160 Ohio St.3d 218, 2020-Ohio-3196, 155 N.E.3d 852, ¶ 17.

{¶18} We review questions of law and summary judgment decisions de novo and apply the same test as the trial court in determining whether summary judgment was proper. Cole v. Am. Industries & Resources Corp., 128 Ohio App.3d 546, 552, 715 N.E.2d 1179 (7th.Dist.1998).

{¶19} Pursuant to Civ.R. 56(C), summary judgment should be granted when reasonable minds could reach but one conclusion and that conclusion is adverse to the nonmoving party. The moving party has the burden of showing no issue exists as to any material fact. State ?. Licsak, 41 Ohio App.2d 165, 324 N.E.2d 589 (1974); Mitseff v. Wheeler, 38 Ohio St.3d 112, 526 N.E.2d 798, syllabus (1988).

{¶20} Once the moving party meets his burden, the opposing party may not rely on the allegations in his pleadings, but must...