Sheba v. Kautz
Opinion
OPINION
ROBB, P.J.
{¶ 1} Defendants-Appellants Patricia Kautz, et al. appeal the decision of the Belmont County Common Pleas Court granting summary judgment in favor of Plaintiffs-Appellees George Sheba, et al. The trial court's decision finding the mineral interest was abandoned under the 1989 version of the Dormant Mineral Act cannot be upheld due to intervening precedent from the Ohio Supreme Court. However, the trial court alternatively held the grantor in an 1848 deed did not reserve oil and gas interests as the use of the term "mineral" in the reservation showed the intent of the parties to the deed was to reserve coal and other mined minerals, not migratory minerals.
{¶ 2} The grant of summary judgment is affirmed based upon: the Supreme Court's Detlor holding which found an 1890 deed did not transfer oil and gas interests when it transferred coal and other minerals; the age of the deed in this case which was executed over 40 years earlier than the deed in Detlor ; the language in the deed as to mining from adjacent property; and the lack of evidence suggesting the parties to the deed contemplated the inclusion of oil and gas as minerals in this Belmont County locality in 1848.
STATEMENT OF THE CASE
{¶ 3} In 1848, Thomas and Sophia Day (hereinafter Day) executed a deed transferring their Belmont County property to Christian Anshutz with the following reservation:
Said Day however expressly reserves to himself his heirs and assigns the sole and exclusive right to all the mineral & coal lying under the tract of land above described with the right & privilege to mine the same from his land on the East side thereof, excepting a parcel [11.5 poles wide on the South side] the said Anshutz and his heirs & assigns are to have in fee simple the entire mineral and coal privilege under the said last mentioned tract [re-describing the 11.5 pole strip] also the land above said coal & mineral-The meaning & interest of the above exception is to reserve the coal and mineral privileges under the whole of the above described tract of land, to the said Day his heirs & assigns excepting only [the 11.5 pole strip]; but *895 the said Day his heirs & assigns are not to enter upon any part of the same to mine for said coal & mineral , but may enter [ ? 1 ] under only from his own land on the East and Northeast side thereof. To have and to hold the above tract of land with all the appurtenances thereof excepting as above exception * * *. (Emphasis added.)
{¶ 4} Mr. Sheba owns the property Day transferred in 1848 subject to the above reservation. On May 14, 2013, Mr. Sheba executed an oil and gas deed granting Ridgetop Resources, LLC an undivided interest in certain property, including 210 acres subject to the Day reservation. Mr. Sheba published a notice of abandonment of the Day mineral interest on July 24, 2013 and filed an affidavit of abandonment on September 3, 2013. An attorney for Mrs. Kautz and three other heirs of Day filed a claim to preserve the mineral interest on September 23, 2013.
{¶ 5} In October 2013, Mr. Sheba and Ridgetop Resources (hereinafter Appellee) filed a complaint against the four heirs (hereinafter Appellant). A second amended complaint added more defendants in May 2014. In seeking declaratory judgment and quiet title, the complaint set forth four claims: (1) the 1848 reservation did not reserve title to oil and gas under the property; (2) the oil and gas interest was abandoned under the 1989 version of the Dormant Mineral Act (DMA) due to the lack of a savings event; (3) the oil and gas interest was abandoned under the 2006 version of the DMA due to the lack of a savings event and the failure of the holder to file a claim to preserve within 60 days of the publication of the notice of abandonment; and (4) adverse possession of the oil and gas interest. As to the adverse possession claim, the complaint stated Mr. Sheba actively leased the oil and gas interest since 1976, including leases recorded in 1979, 2005, and 2011.
{¶ 6} Appellant filed an answer asserting the Days did reserve the oil and gas under the property, the 1989 version of the DMA was inapplicable and unconstitutional, the 2006 version of the DMA applied, the notice of abandonment was improper, a claim to preserve was filed, and adverse possession did not occur. A counterclaim was filed seeking quiet title and damages for trespassing and conversion.
{¶ 7} Appellee filed a motion for summary judgment on the first three counts arguing: the 1848 reservation did not include oil and gas; the mineral interest was automatically abandoned under the 1989 DMA; and the mineral interest was abandoned under the 2006 DMA. Appellant filed a memorandum in opposition, and Appellee filed a reply. The Ohio Attorney General intervened to support the constitutionality of the 1989 version of the DMA. On January 20, 2015, the trial court granted the Attorney General's motion for partial summary judgment and ruled the 1989 DMA was not unconstitutional.
{¶ 8} On January 26, 2015, the trial court granted summary judgment in favor of Appellee. As to the first claim, the trial court found the two references to "mining" in the 1848 reservation demonstrated the intent to reserve only coal and other minerals that are mined rather than migratory minerals such as oil and gas. The trial court quoted the following passage from
*896
the Ohio Supreme Court's 1898
Detlor
case: "There is nothing to show that it was the intention of the parties that oil should be included in the word 'minerals,' and the easements granted, in connection with the mining right, are not applicable to producing oil, and show that oil was not intended to be included in the conveyance."
Detlor v. Holland
,
{¶ 9} As to the claim set forth under the 1989 DMA, the trial court concluded abandonment was automatic where no savings event occurred within the twenty-year look-back window, noting Appellant admitted there were no savings events. The court reiterated its prior decision finding the 1989 DMA was not unconstitutional. As to the claim set forth under the 2006 DMA, the trial court stated: "any discussion of RC. 5301.56, effective June 30, 2006 is moot in that any oil and gas interests which the Defendants may have claimed would have been abandoned as of March 22, 1992" under the 1989 DMA. Appellant filed a timely notice of appeal.
ASSIGNMENTS OF ERROR ONE & TWO: 1989 DMA
{¶ 10} Appellant's first two assignments of error provide:
"The trial court erred in applying the 1989 version of the Ohio Dormant Mineral Act to the subject case."
"The trial court erred in determining that the 1989 Dormant Mineral Act 'automatically' vested the mineral interests in the surface owners."
{¶ 11} The Ohio Supreme Court ruled the 1989 DMA was not self-executing and did not result in automatic abandonment of a mineral interest.
Albanese v. Batman
,
ASSIGNMENT OF ERROR NUMBER THREE
{¶ 12} Appellant's third assignment of error contends:
"The trial court erred in finding that the language 'all the minerals and coal' in a reservation did not include Oil and Gas."
{¶ 13} The purpose of contract or deed construction is to discover and effectuate the intent of the parties, which is presumed to reside in the language they chose to use in their agreement.
Graham v. Drydock Coal Co.
,
{¶ 14} The parties contest the trial court's application of the Ohio Supreme *897 Court's holding in Detlor to this case. Appellant believes the trial court improperly focused on the deed's reference to "mining" to impute an intent to reserve only coal and minerals that are mined as opposed to migratory minerals such as oil and gas. Appellant relies on this court's Coldwell case, the Fourth District's Jividen and Wiseman cases, and the Fifth District's Hardesty case, which interpreted the phrase "other minerals" as conveying oil and gas (under the circumstances presented in those cases). Appellant focuses on the word "all" in the reservation clause "all the mineral and coal" and urges this is equivalent to saying "every mineral" or "every part of the mineral," citing Black's Law Dictionary and Merriam-Webster Dictionary . Appellant also states the deed's use of the word "and" in "all the mineral and coal" or "the coal & mineral privileges" shows an intent to retain more than coal. As to this latter argument, the trial court did not hold the deed only conveyed coal, and Appellee did not argue such a theory; the theory was the deed conveyed only non-migratory minerals capable of being mined.
{¶ 15} Appellee responds the trial court correctly applied the holding in Detlor to the facts of this case involving a deed executed 42 years before the deed interpreted in Detlor . Appellee states that, as in Detlor , there was restrictive or limiting language in the 1848 deed (where it twice said "to mine"), which indicated the intent to reserve only coal and solid minerals capable of being mined, not oil and gas. Appellee argues the Hardesty and Wiseman cases are distinguishable (as those deeds had no qualifying or limiting words) and cites two other Fifth District cases, Muffley and Gordon (where the deed's use of the word "minerals" was not found to include oil and gas). Appellee distinguishes this court's Coldwell case and the Fourth District's Jividen case, where deeds contained "surface only" language.
{¶ 16} Appellee also notes deed construction involves the intention of the parties at the time of execution , which in this case was 1848. Appellee emphasizes 1848 pre-dated the development of oil and gas in Ohio, citing Ogline, Black Gold: An Oil and Gas Primer for Estate Planners , 20 Ohio Prob. L.J. 31 (2009), which states: "The first commercial exploration for oil in Ohio took place in 1860 when a well was drilled in Washington County. Natural gas production followed in 1884." 2
{¶ 17} In general, minerals include oil and gas.
See, e.g.,
Ohio Constitution, Art. II, Section 36 (allowing laws to be passed "to provide for the regulation of methods of mining, weighing, measuring, and marketing coal, oil, gas, and all other minerals"); R.C. 5301.56(A)(4) (defining "mineral" for the DMA). This was also true, in a broad sense, during the time frame pertinent in the Supreme Court's
Detlor
case.
See
Detlor v. Holland
,
hereby grant, bargain, sell, and convey to the said Michael L. Deaver, his heirs and assigns, forever, all the coal of every variety, and all the iron ore, fire clay, and other valuable minerals, in, on, or under the following described premises: * * *; together with the right in perpetuity to the said Michael L. Deaver, or his assigns, of mining and removing such coal, ore, or other minerals; and the said Michael L. Deaver, or his assigns, shall also have the right to the use of so much of the surface of the land as may be necessary for pits, shafts, platforms, drains, railroads, switches, side tracks, etc., to facilitate the mining and removal of such coal, ore, or other minerals, and no more.
Detlor
,
{¶ 18} The Court set forth "familiar" rules of construction, such as construing the grant most strongly against the grantor and considering the whole contract to arrive at the meaning of any of its parts. "Terms are to be understood in their plain, ordinary, and popular sense, unless they have acquired a particular technical sense by the known usage of the trade. They are to be construed with reference to their commercial and scientific import."
Id.
at 503-504,
{¶ 19} The Supreme Court explained
the deed must be construed in the light of oil developments in the vicinity of the property at the time the deed was drafted
in February 1890.
Detlor
, 57 Ohio St. at 502-503,
Taking all the terms of the conveyance in the light of the surrounding circumstances, and in view of the above rule of construction, and upon authority of the case of Dunham v. Kirkpatrick ,101 Pa. St. 36 [ (1882) ], we conclude that the title to the oil did not pass under said conveyance, but remained in the owner of the soil, and upon his death passed to his heirs. There is nothing to show that it was the intention of the parties that oil should be included in the word 'minerals,' and the easements granted, in connection with the mining right, are not applicable to producing oil, and show that oil was not intended to be included in the conveyance. If it had been, apt *899 words would have been used to express such intention.
Detlor
, 57 Ohio St. at 504,
{¶ 20} The case cited by the Ohio Supreme Court contains what is known as Pennsylvania's
Dunham
rule for private deed conveyances.
See
Dunham v. Kirkpatrick
,
{¶ 21} Although the Ohio Supreme Court cited Dunham in Detlor , the Court also instructed reviewing courts to consider the time (of deed execution) and locality (of the property) to define minerals. In addition, the Ohio Supreme Court focused on easement language in the deed particular to the mining of coal and hard minerals and the corresponding lack of language relevant to the capture of oil and/or gas. We review the Ohio appellate cases applying the principles in Detlor .
{¶ 22} In
Gordon
, the plaintiff-grantor executed a 1902 Licking County deed granting: "All the coal and other minerals under the surface" with a right "to enter upon said land, make all excavations, drains, entries, and structures of whatever nature as may be necessary to conveniently take out said minerals, with a right of way over and across said land for the purpose of transferring said minerals from said land, doing no unnecessary damage and injury to said property." The Fifth District quoted from
Detlor,
found the circumstances similar, and concluded the language did not show intent to transfer oil and gas.
Gordon v. Carter Oil Co.
,
{¶ 23} In
Hardesty
, the defendant executed a 1919 Holmes County deed conveying "all the coal, clay and mineral rights." (At the time, she was receiving delay rentals under an oil and gas lease covering her property.) The grantee's right was conveyed in 1923, and the purchaser sued the original grantor claiming the oil and gas was conveyed under the 1919 deed. The defendant testified the intent she shared with the original grantee was that only non-migratory minerals were transferred. The Fifth District found this testimony was barred by the parol evidence rule.
Hardesty v. Harrison
,
{¶ 24} In
Muffley
, a 1960 deed reserved to the grantor "all minerals, clay, and coal underlying the soil, subject only to the condition that the removal of said minerals, clay, and coal shall be without damage to the surface of said land except to provide air shafts and escape for mine water." The Fifth District noted it once decided "a much more difficult case" involving Tuscarawas
*900
County deeds executed in 1882 and 1884 "containing non-specific mineral reservation" where the court reviewed the date of the reservations and concluded they did not include oil and gas due to the Ohio Supreme Court's
Detlor
holding.
Muffley v. M.B. Operating Co., Inc.
, 5th Dist. No. CA-6910,
{¶ 25} In
Jividen
, a 1910 deed said the purpose was to "convey the surface only" and to "reserve all coal and other mineral, with the right to mine and haul same through this and adjacent land" and "the right to sink air shaft on said land" and to "extend their switch up the hollow."
Jividen v. New Pittsburg Coal Co.
,
{¶ 26} In
Wiseman
, an 1894 Lawrence County deed excepted and reserved "all the coal, iron-ore and other minerals" and "rights of ingress, egress, regress and of way, and other necessary or convenient rights and privileges, in, upon, under and over the same for the purpose of mining, removing, and taking away as well the coal, iron-ore and on and underlying the said land as other coal, iron-ore and minerals."
Wiseman v. Cambria Products Co.
,
{¶ 27} In
Coldwell
, this court set forth the language of two Columbiana County deeds. One deed referred to "all the coal and other minerals" with "the right and
*901
privilege to mine all of said coal without reservation or liability for damages that may arise by reason of mining said coal or the operation of said mine or mines to the surface" and "the right and privilege to the use of the necessary surface over said coal for the purpose of erecting, constructing and maintaining the necessary air shafts and air courses to ventilate mines for the removal of said coal and other minerals."
Coldwell v. Moore
,
{¶ 28} After reviewing Detlor and holdings from the Fourth and Fifth Districts, it was stated: "Nothing in the language of these deeds shows that the parties contemplated something less general than 'other minerals.' * * * Also, nothing in the deeds is inconsistent with the development of oil and gas." Id. at ¶ 43. This court observed: "The term "minerals" has long been held to include oil and gas." Id. Appellant focuses on this portion of the decision.
{¶ 29} Appellee, however, points out the
Coldwell
case then stated the
most important
factor was deed language stating the plaintiffs were granted
surface rights only
.
Id.
, citing
Jividen
,
{¶ 30} In the case at bar, Appellant states the use of "all" in the clause "all the mineral & coal" is plain language requiring this court to include every possible mineral. However, this is not the law under Detlor . The deed in Detlor also used "all" which would have modified "other valuable minerals," i.e., the deed conveyed "all the coal of every variety, and all the iron ore, fire clay, and other valuable minerals." Appellant's emphasis on the word (or symbol for) "and" between mineral and coal is even less compelling. There was no argument only coal was reserved. As aforementioned, the argument was this phrase conveyed coal and other non-migratory minerals.
{¶ 31} The Detlor holding suggests the more recent the deed, the more likely it is oil and gas were intended to be included as minerals. The year the deed was signed in the case at bar is much earlier than the deeds in any of the cited cases. Detlor addressed an 1890 deed; this case involves an 1848 deed. The Supreme Court focused on the lack of evidence supporting the position that oil and gas were known in the area or anticipated in the transfer. As in Detlor , there is no indication oil and gas were being produced in the immediate vicinity in 1848. Nor is there any indication such substances were being produced in the general area or elsewhere. Appellant's response to summary judgment did not set forth evidence to distinguish the case from Detlor, and Appellant did not show gas or oil was produced in Belmont County or the general vicinity of this property in 1848.
{¶ 32} In construing the deed in terms of the date of execution and vicinity, the
Detlor
court also found it relevant that the easements granted in the deed were "peculiarly applicable to the mining of minerals in place" rather than to minerals of a
*902
migratory character, noting "nothing is said about derricks, pipe lines, tanks, the use of water for drilling, or the removal of machinery used in drilling or operating oil or gas wells."
Detlor
, 57 Ohio St. at 503,
{¶ 33} Appellee states the reference to "mining" was part of the limiting language in
Detlor
which was used to conclude the deed did not refer to migratory minerals. The deed here has two references to the right to "mine," which Appellee construes as language limiting or restricting the word mineral. We note the holding: "Unless the language of the conveyance by which the minerals are acquired repels such construction, a severed mineral estate is considered to include those rights to use of the surface as are reasonably necessary for the proper working of the mine and the obtaining of the minerals."
Chesapeake Exploration, L.L.C. v. Buell
,
{¶ 34} Even if the word "mine" itself is not dispositive, the clauses containing the word support Appellee's position. This case involves a conveyance with language that "repels" a construction of the right to use the surface in any manner reasonably necessary for obtaining all minerals. Specifically, the first reference to mining is in the clause: "the right and privilege to mine the same from his land on the East side thereof * * *." This limits the right to mine from a separate parcel owned by the grantor. One may ask how one could mine for oil or gas from a separate parcel in the year 1848 (thus horizontal fracturing is not considered). The second reference to mining states the grantor and his heirs and assigns "are not to enter upon any part of the same to mine for said coal & mineral, but may enter & ___ under only from his own land * * *."
{¶ 35} Considering the principles in Detlor , the much earlier deed in this case, the lack of evidence that oil and gas production were contemplated at the time or place of conveyance, and the state's history of oil and gas production, this court overrules this assignment of error and upholds the trial court's decision finding the 1848 deed did not reserve oil and gas interests.
CONCLUSION
{¶ 36} Due to recent Ohio Supreme Court rulings, the decision finding automatic abandonment under the 1989 DMA was erroneous and the first two assignments of error have merit. However, the trial court's alternative decision (finding the 1848 deed did not reserve an oil and gas interest) was proper. Appellant's third assignment of error is therefore overruled. In accordance, the trial court's entry of summary judgment is affirmed.
Donofrio, J., concurs.
DeGenaro, J., concurs.
The deed is handwritten. This mystery term may be "& leafe" (or "leaf") representing the word "leave" based on: it is the opposite of "enter" which was used just before the mystery word; it would thus define the grantor's right to "enter & leave under only from his own land"; and this corresponds to a typical deed reference to the means of ingress and egress. Or, the mystery term may be "& pass" (as translated in a later deed transferring the land to Mr. Sheba).
According to this source, oil was first accidentally discovered in Ohio in 1814 in a saltwater well drilled in Noble County.
See
Ogline,
Black Gold.
"Because the oil well was not developed, it was not until several decades later in 1859 that the more famous oil 'discovery' occurred in a commercial oil field in the Allegheny headwaters of the Ohio River at Titusville [Pennsylvania]." Frost and Mitsch,
Resource Development and Conservation History along the Ohio River
, 89 Ohio J. of Science 143, 148 (1989). Colonel Drake successfully drilled the first commercial oil well (or one of the first) in America in 1859 in western Pennsylvania.
This particular statement appears contradictory. Applying Detlor 's instruction to consider the timing of the deed and the Court's use of the lack of knowledge of oil in the area as a reason for not including oil and gas in the reservation, one would think a 1960 deed would be construed as including oil and gas because these minerals had become pervasive by that time. The rationale in Muffley construes the time of execution against oil and gas when it was not known at the time (citing Detlor and Belden ) but then also construes the time of execution against oil and gas when it was known at the time. Although the Muffley court did not expressly rely on it, we note the deed's additional language, "shall be without damage to the surface of said land except to provide air shafts and escape for mine water," which could be construed as limiting language.
Case-law data current through December 31, 2025. Source: CourtListener bulk data.