David W. and Suellen H. Hill v. Lone Pine Operating Co.
16-0219
| W. Va. | Nov 18, 2016Background
- Petitioners (David and Suellen Hill) own the surface to a 364.60-acre parcel conveyed in 1976 expressly subject to a preexisting 1899 Haymond oil-and-gas lease covering a 1,300-acre tract.
- In 1988 the county assessor created duplicate “Leased” royalty-based assessments for portions of the 1,300-acre lease in names including Mitchell, Sigmond, and Rapp; some duplicates went unpaid for tax year 1989 and were sold to the State.
- By tax deed dated June 27, 1994, the Deputy Commissioner conveyed the 1989 (duplicate) assessments in the names of Mitchell and Rapp to petitioners; petitioners later sued to quiet title and obtain royalties from the minerals under their 364.60-acre surface tract.
- Lone Pine (respondent) acquired Mitchell’s and Sigmond’s mineral interests in 2010 and counterclaimed that the 1994 tax deed was void because it derived from erroneous duplicate assessments that did not convey mineral title.
- The circuit court set aside the 1994 tax deed as void, held the duplicate “Leased” assessments never represented ownership of minerals, declared Lone Pine sole owner of the contested oil-and-gas interests, and ordered escrowed funds delivered to Lone Pine; the court also denied petitioners’ motion to alter or amend.
Issues
| Issue | Plaintiff's Argument (Hill) | Defendant's Argument (Lone Pine) | Held |
|---|---|---|---|
| Whether the tax deed based on duplicate "Leased" assessments conveyed mineral title | Hill: The royalty-based ("Leased") tax was mandated and because Hill paid royalty taxes, their title is superior | Lone Pine: The duplicate "Leased" assessments were void and never represented ownership; Mitchell paid the proper acreage taxes so his interest was protected | Court: The duplicative "Leased" assessments did not represent ownership; deed issued on void assessments is void — tax deed set aside |
| Whether WV Code §11-4-9 or other tax-law principles protect Mitchell’s interest from the duplicate sale | Hill: The assessor’s presumption of correct assessment should stand; failure to contest assessment bars challenge | Lone Pine: Mitchell continuously paid taxes on the actual 376.5-acre mineral entry so his interest could not be sold via the duplicate entry | Court: §11-4-9 and the fact Mitchell paid original taxes mean the duplicate sale could not divest him; sale to petitioners void |
| Applicability of the ten-year recovery statute (WV §55-2-1) / adverse possession | Hill: Mitchell waited beyond ten years to challenge, so Lone Pine cannot recover | Lone Pine: Mitchell had no reason to attack the deed because he believed his original taxes were paid; petitioners have not shown actual adverse possession | Court: §55-2-1 inapplicable—no actual adverse possession shown and petitioners never had legal title because deed was void |
| Bona fide purchaser for value defense | Hill: Lone Pine paid nominal amounts and did not purchase for fair value; thus not a BFP | Lone Pine: Acquired interests via deeds from Mitchell and Sigmond; rights enforceable | Court: Petitioners failed to cite record evidence to support BFP attack; Court declines to decide merits due to inadequate record citations |
Key Cases Cited
- Bailey v. Baker, 68 S.E.2d 74 (W. Va. 1951) (a deed made pursuant to a tax sale under a void assessment is void)
- Blair v. Freeburn Coal Corp., 253 S.E.2d 547 (W. Va. 1979) (reaffirming that tax-sale deeds under void assessments are void)
- Camden v. West Branch Lumber Co., 53 S.E. 409 (W. Va. 1906) (adverse possession requires actual occupation sufficient to give notice)
- Toler v. Shelton, 204 S.E. 85 (W. Va. 1974) (standard of review for Rule 60(b) motions: abuse of discretion)
- Davis v. Foley, 457 S.E.2d 532 (W. Va. 1995) (summary-judgment rulings reviewed de novo)