Johnson Family Trust v. Antero Resources Corp.
16-0070
| W. Va. | Nov 10, 2016Background
- Parties entered a Surface Use Agreement (SUA) dated May 8, 2009: two-year primary term "and as long thereafter as any of the facilities... are utilized for the purposes of oil and gas development and transmission."
- Antero paid consideration, agreed to various surface uses (water from frac-pits, temporary above-ground water lines, pipelines, restricted traffic to essential personnel) and certain reclamation obligations (reseeding, mulching) reflected in referenced exhibits.
- Petitioner (Johnson Family Trust) sued alleging breach: Antero completed three wells and, after completion, failed to reclaim the surface, instead using the site for water storage, pipe/equipment storage, vehicle parking, lights and an office.
- Antero moved for summary judgment, submitting affidavits (Timothy R. Rains) showing three producing wells were constructed within the primary term and that Antero continued to use the surface for oil and gas operations; petitioner submitted no evidentiary support in the record.
- Circuit Court granted Antero summary judgment and denied petitioner’s motion to evict/forfeit bond; petitioner’s Rule 59(e) motion to alter/amend was denied and this appeal followed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Antero breached the SUA by failing to reclaim after the two-year primary term | SUA had a two-year term; after two years land should be reclaimed and returned to owner | SUA extends "as long thereafter" as facilities are utilized; wells were producing so SUA remained effective | No breach — SUA continued while facilities were utilized; summary judgment for Antero |
| Whether Antero used property for unauthorized purposes (water offsite, storage, vehicles, lights, office) | Post-completion uses exceeded SUA scope and required compensation / eviction | SUA expressly permitted onsite/offsite water use, temporary lines, pipelines, and operations reasonably necessary to production | No breach — cited SUA language and lack of contrary evidence; uses fell within permitted/necessary activities |
| Whether petitioner raised genuine issues of material fact to avoid summary judgment | Belief and assertions that reclamation and restoration were required after two years | Antero produced sworn affidavits showing wells were commenced/producing within the term and partial reclamation occurred; petitioner produced no record evidence | Petitioner failed to meet nonmoving-party burden; self-serving assertions insufficient; summary judgment affirmed |
| Whether reclamation obligations in SUA/permit were violated (specific reclamation steps) | Petition points to referenced exhibit and permit reclamation requirements and alleges steps were not completed | Antero represents partial reclamation done and awaiting final federal approval; petitioner did not include permit or evidentiary proof in record | Court declined to address inadequately developed/unsupported claim; petitioner failed to preserve/show factual dispute |
Key Cases Cited
- McCullough Oil, Inc. v. Rezek, 176 W. Va. 638, 346 S.E.2d 788 (W. Va. 1986) (explaining the habendum clause: primary term and extension while production/operations continue)
- Williams v. Precision Coil, Inc., 194 W. Va. 52, 459 S.E.2d 329 (W. Va. 1995) (if moving party shows no genuine issue, nonmoving party must produce evidence beyond mere assertions)
- Buffalo Mining Co. v. Martin, 165 W. Va. 10, 267 S.E.2d 721 (W. Va. 1980) (surface use by mineral owner must be reasonably necessary to extraction of the minerals)