VIRGIL FARNSWORTH, et al., PLAINTIFFS-APPELLEES, VS. JAMES BURKHART, et al., DEFENDANTS-APPELLANTS.
CASE NO. 13 MO 14
STATE OF OHIO, MONROE COUNTY IN THE COURT OF APPEALS SEVENTH DISTRICT
September 22, 2014
2014-Ohio-4184
Hon. Joseph J. Vukovich, Hon. Cheryl L. Waite, Hon. Mary DeGenaro
CHARACTER OF PROCEEDINGS: Civil Appeal from Common Pleas Court, Case No. 2012-133. JUDGMENT: Reversed.
For Plaintiffs-Appellees: Attorney James Huggins, Attorney Daniel Corcoran, Attorney Kristopher Justice, 424 Second Street, Marietta, Ohio 45750
For Defendants-Appellants: Attorney Mark Stubbins, 59 North Fourth Street, P.O. Box 0488, Zanesville, Ohio 43702-0488
VUKOVICH, J.
{¶1} The mineral holders appeal the decision of the Monroe County Common Pleas Court which ruled that they abandoned their mineral interest in the surface owners’ property. In their first assignment of error, the mineral holders argue that the trial court erred in finding they abandoned their mineral interests under the 1989 Dormant Mineral Act because: (1) that version no longer applies, (2) the twenty-year look-back period is fixed rather than rolling; (3) reference to the original reservation in a later surface transfer is a savings event; and (4) the 1989 version is an unconstitutional taking of property without notice.
{¶2} Following the various prior holdings of this court we conclude: (1) under the holding in Walker, the 1989 DMA can still be applied; (2) under the holding in Eisenbarth, the look-back period is fixed, not rolling; (3) under the holding in Dodd, the reference to a prior mineral severance in a surface transfer deed is not a savings event; and (4) under the holding in Walker, arguments on the constitutionality of the 1989 DMA are waived where not raised below. The second conclusion is dispositive here as the minerals were originally severed within the fixed look-back period. There was thus no abandonment under the 1989 DMA.
{¶3} In their second assignment of error, the mineral holders argue that the trial court erred in alternatively holding that they abandoned their mineral interests under the 2006 DMA as well. This court’s Dodd decision ruled that the mineral holders’ timely claim to preserve after notice of abandonment prevented abandonment under the 2006 DMA if the 1989 DMA does not apply. Accordingly, the judgment of the trial court is reversed, and judgment is entered that the mineral holders retain their mineral interests in the subject property.
STATEMENT OF THE CASE
{¶4} In 1980, a deed was signed and recorded whereby Veronica Burkhart conveyed 104 acres in Monroe County to the Belcastros. She reserved for herself and her heirs and assigns all minerals under the premises along with the right to enter and explore for same (and conveyed the right to free gas to the grantees). In 1988, the Belcastros deeded the property to Virgil and Theresa Farnsworth,
{¶5} When Veronica Burkhart died, her mineral rights were inherited by seven heirs: James, Dale, Ellis, Mark, Francis, and Glen Burkhart and Judy Gallagher. Although Veronica died in 1995, the heirs did not apply for a certificate of transfer until February 6, 2012. The Monroe County Probate Court issued the certificate of transfer on February 24, 2012. It was recorded in the Monroe County Recorder’s Office on February 27, 2012.
{¶6} In the meantime, on February 22, 2012, the Farnsworths generated a notice of abandonment (the first step in proceeding under the 2006 DMA), sending notice to the seven mineral holders by certified mail, return receipt requested. This notice of abandonment was served on the named holders as follows: February 24 (James, Ellis, and Francis), February 25 (Mark and Glen {signed for by his surviving spouse as he died in 1996}), February 27 (Dale), and March 1 (Judy).
{¶7} On April 19, 2012, these holders recorded a timely claim to preserve their mineral interests under the 2006 DMA. On April 23, 2012, the Farnsworths recorded an affidavit of abandonment. The Farnsworths then filed a complaint seeking quiet title to the minerals upon a declaration that the Burkhart heirs abandoned their mineral interests under both the 1989 and the 2006 DMA. Motions for summary judgment motions were filed, and on July 16, 2013, the trial court granted summary judgment in favor of the Farnsworths.
{¶8} The trial court stated that the former Dormant Mineral Act was self-executing and could still be utilized for abandonment claims. The court then applied a rolling look-back period and ascertained that there were no savings events from June 30, 1986 to June 30, 2006 (described as the last day the former DMA was in effect). In so holding, the trial court stated that the 1988 deed transferring the surface was not a savings event because it merely repeated the former grantor’s prior mineral reservation. The court concluded that the mineral interest was abandoned and reunited with the surface under the 1989 DMA.
{¶9} In the alternative, the trial court concluded that there was also an abandonment under the 2006 DMA as the holders did not show a savings event in the twenty years preceding the date of the 2012 notice of abandonment. The court found that any transfer in the probate court was not a savings event until it was recorded in the recorder’s officer (and that this did not occur until after the notice of abandonment was first served). The court also held that the mineral holders’ claim to preserve was not a savings event but merely served to halt the statutory process of abandonment and to require a lawsuit where the holder must show a savings event.
{¶10} The Burkharts filed a timely notice of appeal. They set forth two assignments of error: one addresses the trial court’s application of the 1989 DMA, and one addresses the trial court’s application of the 2006 DMA.
ASSIGNMENT OF ERROR NUMBER ONE: 1989 DMA
{¶11} Pursuant to the 1989 version of the Dormant Mineral Act, a mineral interest held by a person other than the surface owner of the land subject to the interest “shall be deemed abandoned and vested in the owner of the surface” if no savings event occurred “within the preceding twenty years.”
{¶12} The six savings events are as follows: (i) the mineral interest has been the subject of a title transaction that has been filed or recorded in the recorder’s office, (ii) there has been actual production or withdrawal by the holder, (iii) the holder used the mineral interest for underground gas storage; (iv) a mining permit has been issued to the holder; (v) a claim to preserve the mineral interest has been filed; or (vi) a separately listed tax parcel number has been created.
{¶13} The effective date of this statute was March 22, 1989. Division (B)(2) provides that a mineral interest shall not be deemed abandoned on the grounds that none of the circumstances in (B)(1) apply until three years from the effective date of the statute. Another section provides that a mineral interest may be preserved indefinitely from being abandoned by the occurrence of any the savings events in
{¶14} The Burkharts’ first assignment of error sets forth four distinct issues related to the trial court’s application of the 1989 DMA, which will each be addressed separately. This assignment of error provides:
{¶15} “The Trial Court erred in applying the 1989 version of the Dormant Mineral Act causing automatic abandonment of Appellants’ mineral interest when: (1) at the time of filing the lawsuit the current version of
APPLICABILITY OF FORMER DMA
{¶16} The appellant mineral holders note that the 2006 enactment provided that the prior version was repealed and the reenactment added, among other things, that the notice of abandonment commences the twenty-year look-back period. They contend that the law in effect at the time the complaint was filed is controlling and thus only the 2006 DMA can be applied, urging that the 1989 DMA no longer exists. The mineral holders cite LaSalle, which held that the applicable version of an expungement statute is that which is in effect at the time the application to expunge was filed. See State v. LaSalle, 96 Ohio St.3d 178, 772 N.E.2d 1172 (2002) (disposing of argument that applicable version was the new one that went into effect after the expungement application was filed but before trial court ruled).
{¶17} The surface owners respond that LaSalle is not on point here. They assert that the 1989 DMA was self-executing as the mineral rights vest in the surface owner automatically by operation of law upon the non-occurrence of a savings event in the pertinent look-back period. They cite to the United States Supreme Court case dealing with Indiana’s DMA, wherein the Court recognized that the mineral rights
{¶18} The surface owners also cite
{¶19} This court has ruled that the 1989 DMA can still be used after the 2006 amendments because the prior statute was self-executing and the lapsed right automatically vested back to the surface owner. Walker v. Shondrick-Nau, 7th Dist. No. 13NO402, 2014-Ohio-1499 (fka Walker v. Noon). See also Swartz v. Householder, 7th Dist. Nos. 13JE24, 13JE25, 2014-Ohio-2359. The reasoning from those cases is reiterated here.
{¶20} As set forth above, the 1989 DMA provides that a mineral interest “shall be deemed abandoned and vested in the owner of the surface” if no savings event occurred within the look-back period.
{¶21} By way of comparison, the 2006 DMA provides that the mineral interest will not become vested until the surface owner serves or publishes (if applicable) the notice of abandonment on each holder and then, at least thirty but not more than sixty days thereafter, records an affidavit of abandonment.
{¶22} The United States Supreme Court has stated that Indiana’s DMA was self-executing as it provided that the mineral interest shall be extinguished and the
{¶23} In Walker, we pointed to
{¶24} In rejecting a Carroll County trial court’s statement in Dahlgren v. Brown Farm Properties, that any right acquired under the 1989 DMA was merely “inchoate,” this court pointed out that the terms “inchoate” and “vested” are considered opposites. Walker, 7th Dist. No. 13NO402 at ¶ 43. An inchoate right is a right that has not fully developed, matured, or vested. Black’s Law Dictionary (9th Ed.2009) (online). See also Bauman v. Hogue, 160 Ohio St. 296, 301, 116 N.E.2d 439 (1953).
{¶25} In addition, a statute is considered prospective in its application unless expressly made retrospective.
{¶26} We also explained that the 2006 look-back did not expressly or even implicitly make a statute retroactive. Swartz, 7th Dist. Nos. 13JE24, 13JE25, at fn. 2. A look-back period was also a feature of the 1989 DMA. Under the 2006 DMA, the notice of abandonment is the new trigger for the look-back, which item can only apply prospectively because one could not file a notice of abandonment with the 2006 DMA statutory effects and triggers before it was even created. In other words, the new DMA instituted a new look-back initiator (the notice of abandonment) to be employed prospectively in the future. Id.
{¶27} As aforementioned, the 2006 DMA specifically deals with rights that have not yet been deemed abandoned and vested. See
{¶28} But, this does not mean that it erased interests that were previously deemed vested (merely because a suit had not yet been filed to formalize the reverter). See Swartz, 7th Dist. Nos. 13JE24, 13JE25 at ¶ 35. The most pertinent definition of the word “deem” here would be: “to treat [a thing] as being something that it is not, or as possessing certain qualities that it does not possess. It is a formal word often used in legislation to create legal fictions * * *.” Garner, The Dictionary of Modern Legal Usage, 254 (2d Ed.1995).
{¶29} This court explained that the 2006 DMA contains no language eliminating property rights that were previously expressly said to be vested, i.e. it contains no statement that the new requirements for surface owners and the new rights for mineral holders apply retrospectively. See Swartz, 7th Dist. Nos. 13JE24, 13JE25 at ¶ 34, citing Walker, 7th Dist. No. 13NO402 at ¶ 51. It was decided that absent express language eliminating the prior automatic abandonment and vesting of rights under the 1989 DMA, the amendments do not affect causes already existing (regardless of whether a suit is filed before or after the amendments). See id. We
{¶30} This court thus concluded that when the 2006 version was enacted, any mineral interest that was abandoned under the 1989 version stayed abandoned and stayed vested in the surface owner. See Walker, 7th Dist. No. 13NO402 at ¶ 41 (and once the mineral interest vested in the surface owner, it reunited with the surface estate). Here, we reiterate the Walker and Shannon holdings that the 1989 DMA can still be utilized for mineral interests that were deemed abandoned and vested thereunder.
{¶31} The trial court thus properly concluded that the 1989 DMA is still applicable to prior acts of abandonment. This leads to the question of what period is utilized to ascertain whether mineral rights were abandoned due to the lack of a savings event.
FIXED OR ROLLING LOOK-BACK PERIOD
{¶32} The mineral holders argue that the trial court erroneously utilized a rolling look-back period. That is, the trial court proceeded under the premise that the 1989 DMA applies for all years until the current DMA was enacted on June 30, 2006 and that any day until then can be used to commence the twenty-year look-back period. The trial court looked back twenty years from June 30, 2006 and found no savings events. The mineral holders urge that the look-back is fixed at twenty years from the March 22, 1989 date of enactment (with a grace period giving three extra years to perform a savings event if one did not exist in the pertinent time frame). As this mineral reservation was first created by a 1980 deed, there would be no abandonment under the 1989 DMA if a fixed look-back period is employed.
{¶33} As the mineral holders point out, the 1989 DMA states that there must be a savings event “within the preceding twenty years” without immediately specifying within the preceding twenty years of what. They point out that various trial courts and the Fifth District have looked back twenty years from the date of
{¶34} The surface owners respond that the 1989 DMA was in effect from March 22, 1989 until June 30, 2006 (when the new version changed future look-back periods to twenty years immediately preceding the date on which the newly-created notice of abandonment is served or published). The surface owners urge that there is a rolling twenty-year look-back period under the 1989 statute, meaning that the surface owner can pick any date that exists between March 22, 1989 and June 30, 2006 and then look back twenty years from that date (with the grace period applying in the three years after enactment).
{¶35} The surface owners note that the legislature did not specifically state, “twenty years from the date of the enactment.” They also point to division (D)(1), which states: “A mineral interest may be preserved indefinitely from being deemed abandoned under division (B)(1) by the occurrence of any of the circumstances described in division (B)(1)(c) of this section, including but not limited to, successive filings of claims to preserve mineral interests under division (C) of this section.”
{¶36} The surface owners state that the Riddel case found abandonment under the first available twenty-year look-back period and thus had no need to review other twenty-year periods. See Riddel, 5th Dist. No. 94CA114 (original reservation by 1965 deed was a title transaction, and it was recorded in 1973 so it was a savings event). (The surface owners also resort to items outside of that decision to contend that a later claim to preserve in Riddel made the evaluation of other periods unnecessary).
{¶37} The surface owners claim that the mineral holders’ argument should not be adopted as it renders the former DMA a “dead letter law.” They urge that the instruction in
{¶38} As to the latter argument, the OMTA has language which specifically identifies the point of look-back. For instance, “A person has such an unbroken chain of title when the official public records disclose a conveyance or other title transaction, of record not less than forty years at the time the marketability is to be determined, which said conveyance or other title transaction purports to create such interest * * *.” (Emphasis added).
{¶39} 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 surface owners’ answer to this question is: the preceding twenty years of every single day after the statute’s enactment (until the new statute was enacted). However, this court recently ruled that the look-back period in the 1989 DMA is fixed. Eisenbarth v. Reusser, 7th Dist. No. 13MO10, 2014-Ohio-3792. We adopt that holding here.
{¶40} The version of the Dormant Mineral Act being utilized herein was enacted on March 22, 1989. It provides that a mineral interest held by anyone other than the surface owner shall be deemed abandoned and vested in the surface owner unless certain listed circumstances exist, one of which is: “[w]ithin the preceding twenty years * * * the mineral interest has been the subject of a title transaction” that has been filed in the county recorder’s office.
{¶41} The statute does not elucidate that a savings event must occur within twenty years of the last savings event. Eisenbarth, 7th Dist. No. 13MO10 at ¶45. If the legislature intended that a savings event occurring in the original look-back period would last only for twenty years (i.e. a rolling look-back), they did not clearly state this. Id.
{¶42} As to any query of why the legislature would enact a “dead letter law,” the point of the 1989 DMA may have been merely to give three years to eliminate or refresh stale mineral claims in the original look-back period, and the legislature planned to enact a new version for the next twenty-year period if public policy reasons for abandonment still applied in the future. See id. at ¶ 50. In fact, the legislature did then enact the 2006 DMA within twenty years of the former DMA, adding a new look-back period (twenty years from the service of notice). Id.
{¶43} As to
{¶44} We found that a mineral holder would read the statute at the time of enactment and conclude that they were safe due to a savings event in the pertinent period without having any statutory notice that they had to keep creating savings event twenty years from the last event, which could occur a mere few years after the statute’s enactment. Id. at ¶ 47-48. We concluded that use of the words “preceding twenty years,” without stating the preceding twenty years of what, did not create a rolling look-back period. Id. at 48.
{¶45} Notably, Indiana’s DMA discusses abandonment of a mineral interest “if unused for a period of twenty years” (and “use” is defined with the various savings
{¶46} Here, it is not expressed except in terms of “preceding twenty years” and then a grace period is provided for further chances to save. This led us to conclude that only a fixed look-back period could be employed. Id. at ¶ 45, 49 (also noting that forfeitures are abhorred in the law), citing State ex rel. Falke v. Montgomery Cty. Resid. Dev., Inc., 40 Ohio St.3d 71, 73, 531 N.E.2d 688 (1988).
{¶47} As there is a fixed look-back period, there was no abandonment under the 1989 DMA because the mineral rights were not even severed until 1980. The trial court’s decision finding the mineral interests were abandoned under the 1989 DMA is therefore reversed.
SURFACE TRANSFER IS NOT A TITLE TRANSACTION
{¶48} The mineral holders briefly argue that the 1988 recorded deed transferring the surface from the original grantees to the Farnsworths was a savings event because it repeated the prior mineral reservation and included the specific volume and page number in the recorder’s records. The surface owners respond that the mineral rights owned by Veronica Burkhart and inherited by the Burkhart family were not the subject of the surface transfer, citing Dodd for the holding that a reference to a prior severance of the minerals is not a savings event
{¶49} The question is whether “[t]he mineral interest has been the subject of title transaction that has been filed or recorded” in the local recorder’s office.
{¶50} As we concluded that the look-back period was fixed and there was no abandonment under the 1989 DMA, this alternative issue (raised in case a rolling look back was applied) is moot. Still, we point out that this issue would be governed
CONSTITUTIONALITY OF 1989 DMA
{¶51} The mineral holders’ final argument regarding the 1989 DMA is that it results in an unconstitutional taking without due process as it does not have the notice provided for in the 2006 DMA. The surface owners point out that the mineral holders fail to discuss the Texaco case, wherein the United State Supreme Court held that Indiana’s DMA was not unconstitutional.
{¶52} This constitutional argument need not be addressed as the mineral holders set it forth in the alternative in case we ruled against them above. In any event, as the surface owners point out, the mineral holders did not argue below that the 1989 DMA was unconstitutional. It is not mentioned in their answer, in their summary judgment motion, or in their response to the surface owners’ summary judgment motion.
{¶53} This court has ruled that it will not address constitutionality of the 1989 DMA where it had not been raised below. See Walker, 7th Dist. No. 13NO402 at ¶ 54-58. See also Swartz, 7th Dist. Nos. 13JE24, 13JE25 at ¶ 43, citing Danis Clarkco Landfill Co. v. Clark Cty. Solid Waste Mgt. Dist., 73 Ohio St.3d 590, 598, 653 N.E.2d 646 (1995); Abraham v. National City Bank Corp., 50 Ohio St.3d 175, 176, fn. 1, 553 N.E.2d 619 (1990). In accordance, arguments concerning the constitutionality of the 1989 DMA have been waived.
ASSIGNMENT OF ERROR NUMBER TWO
{¶54} The trial court’s decision finding abandonment under the 1989 DMA is being reversed. However, the trial court also determined that, even if there was no abandonment under the 1989 DMA, the mineral interests were later abandoned under 2006 DMA as well. On this holding, the mineral holders’ second assignment of error provides:
{¶55} “The Trial Court also erred in applying the 2006 version of the Dormant Mineral Act since there was a title transaction within the 20 year period prior to notice being served as a result of the application, issuance and subsequent recording of a certificate of transfer conveying the mineral interest and/or recording of a Claim to Preserve Mineral Interest.”
{¶56} The 2006 DMA changes the twenty-year look-back period by stating that a mineral interest is deemed abandoned if none of the savings events have occurred “[w]ithin the twenty years immediately preceding the date on which notice is served or published under division (E) * * *.”
{¶57} First, the surface owner must serve notice of intent to declare the mineral interest abandoned. This notice must be served by certified mail, return receipt requested, to each holder or each holder’s successors or assignees, at the last known address. If service of the notice cannot be completed to any holder, service can be completed by publication.
{¶58} If a mineral holder claims that the mineral interest has not been abandoned, then the holder shall file one of two documents in the recorder’s office not later than sixty days after the notice was served or published.
{¶59} If the mineral holder fails to file a timely claim to preserve or a timely affidavit identifying a savings event within the twenty years immediately preceding the date of service or publication of notice, then the surface owner shall have recorded as memorialization of the abandonment, at which time the mineral interest shall vest.
CLAIM TO PRESERVE
{¶60} In Dodd, this court held that a timely claim to preserve under
{¶61} The surface owners served notice of abandonment on the various mineral holders on various dates: February 24, 25, 27, and March 1, 2012. The mineral holders claim to preserve was recorded on April 19, 2012. There is no dispute that the mineral holders filed a timely post-notice claim to preserve the
{¶62} The trial court determined that a post-notice claim to preserve merely existed in the statute to force the surface owner to litigate the matter of whether there existed a savings event. Our Dodd case then ruled that a timely claim to preserve filed under
{¶63} The surface owners recognize the applicability of our Dodd ruling to the claim to preserve in this case. See Appellees’ Brief at 23. They ask that we refrain from applying Dodd because the mineral holders’ initial brief did not raise the issue as an assignment of error. See Appellees’ Brief at 22. However, we conclude that applying Dodd here is not unfair to appellees.
{¶64} The mineral holders’ motion for summary judgment set forth an argument regarding the effect of their claim to preserve. For instance, they stated, “The statute is designed to permit a mineral owner to preserve their interest by responding in order to avoid abandonment.” Defendants’ Motion for Summary Judgment at 15. They also emphasized that they filed a timely claim to preserve their mineral interest after they were served with the notice “thus further preserving their mineral interest.” Defendants’ Motion for Summary Judgment at 4, 16. Moreover, the trial court specifically ruled “a claim to preserve cannot be the basis for establishing that the mineral interest cannot be abandoned.” (July 16, 2013 J.E. at 11).
{¶65} Appellants’ brief stated that their claim to preserve preserved their rights to the minerals. Appellants’ Brief at 18-19 (while arguing against the affidavit of abandonment). In addition, the conclusion section of appellants’ brief stated, “Appellants’ subsequent recording of the Claims to Preserve Mineral Interest maintained their ownership of the minerals.”
{¶66} Appellees’ brief cited to this court’s brand new holding in Dodd. The reply brief then pointed to our Dodd holding regarding a timely claim to preserve and
{¶67} For all of these reasons, we cannot conclude that an argument under Dodd was waived by not fully asserting it until the reply brief. We conclude that the surface owners’ timely claim to preserve under
{¶68} Accordingly, the judgment of the trial court is reversed, and judgment is entered that the mineral interest was not abandoned by the mineral holders.
Waite, J., concurs.
DeGenaro, P.J., concurs in judgment with concurring in judgment only opinion.
DeGenaro, P.J., concurring in judgment only with concurring in judgment only opinion.
{¶69} I agree with the majority that pursuant to this court‘s decision in 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, the 1988 deed does not constitute a title transaction and thus is not a savings event under
{¶70} 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 in this case: 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. Because the Burkharts timely recorded a claim to preserve pursuant to
{¶71} Although first and foremost I disagree with the majority‘s decision that the 1989 ODMA governs here, secondarily I believe their analysis of the 1989 ODMA is itself flawed by concluding that the Burkharts were able to preserve their mineral interest pursuant to the 2006 ODMA. Operating under the rationale that the 1989 ODMA controls and is an automatic, self-executing statute, the Burkharts were no longer the holders of the severed mineral interest when they recorded the certificate of transfer and a claim to preserve pursuant to the 2006 ODMA in 2012. The mineral rights had automatically reverted and vested in the Farnsworths’ predecessors in interest in 2000 by operation of the 1989 ODMA. Said differently, 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. Thus, title to the mineral rights should be quieted in the Farnsworths.
Nature of Interest, Forfeiture, Vesting and Laches
{¶72} Prior to the enactment of
{¶73} 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 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).
{¶74} 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,
{¶75} 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;
{¶76} 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
{¶77} Finally, and conceding the doctrine of laches was not raised, nonetheless it bears consideration here as in Eisenbarth. The Farnsworths, who took title to the surface fee in 1988, failed to avail themselves of the 1989 ODMA while it was still in effect. An action to quiet title could have been filed in 2000 when the mineral rights arguably automatically reverted to them by operation of the statute. Instead, it wasn‘t until after the 2006 ODMA went into effect, that the Farnsworths published a notice of abandonment in February, 2012 pursuant to the 2006 ODMA —in response to which the Burkharts timely filed a claim to preserve— and then filed a quiet title action later that year, a lapse of 12 years. The prejudice to the Burkharts 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).
Indiana Lapsed Mineral Act and Texaco v. Short
{¶79} First turning to two elemental points, the constitutionality of Indiana‘s statute was at issue in Texaco, whereas the constitutionality of the 1989 ODMA is not at issue here or in the preceding trilogy of cases, further undermining the persuasive value of TexacoTexaco is distinguishable. Second, it appears that Indiana‘s Act remains unchanged with respect to its notice provisions, and presumably because the Texaco majority 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 626 (1980) that a self-executing statutory abandonment is constitutionally enforceable). Conversely, the Ohio General Assembly, recognizing the inoperability of the 1989 ODMA, seized the opportunity to clarify its intent and correct
{¶80} 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) 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
{¶81}
{¶82} The 2006 ODMA removed the ambiguity and potentially arbitrary operation of the 1989 ODMA 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 possibly abandoned interest.
{¶83} Here, the majority‘s interpretation of the 1989 ODMA as an automatic self-executing statute has created a forfeiture of what were heretofore private property rights protected at common law from extinguishment by abandonment or 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
2006 ODMA Governs Resolution of Severed Mineral Rights Disputes
{¶84} Consistent with the analysis in the minority opinion in Eisenbarth, the majority has misinterpreted the 1989 ODMA in addition to giving it 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).
{¶85} 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 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.
{¶86} 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 presented in this and the related trilogy of cases,
{¶87} 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
{¶88} The 2006 version of
{¶89} 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
Alternative 1989 ODMA Analysis
{¶90} 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. The provision in
{¶91}
{¶92} Pursuant to the 1989 ODMA, the original severance of the mineral rights by Veronica Burkhart in 1980 was the subject of a title transaction contemplated by
{¶93} Applying the rationale that the 1989 ODMA is controlling and an automatic self-executing statute, neither the February, 2012, certificate of transfer purporting to transfer Veronica Burkhart‘s mineral interest to her heirs, nor the April, 2012, claim to preserve can constitute a savings event for the Burkharts because they were no longer the holders of mineral rights that could be transferred or preserved as of 2012. Those severed mineral rights automatically vested and reverted to the Farnsworths in 2000 by operation of the 1989 ODMA 12 years earlier. Both filings were recorded 32 years after the last savings event, well beyond the 20 year look-back period provided for in
{¶94} Because the severed interest had been reunited with the surface fee in 2000 by operation of the 1989 ODMA, the majority has incorrectly concluded that the Burkharts preserved their mineral interest pursuant to the 2006 ODMA. Accordingly, title to the mineral rights should be quieted in the Farnsworths.
Conclusion
{¶95} In sum, 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
{¶96} Yet the majority has chosen to ignore the existence of the 2006 ODMA and construe the 1989 ODMA 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.