Dodd & Bologna v. Croskey – In 2012, an Ohio court reaffirmed the settled property rights of mineral owners in severed estates where the surface owner is statutorily precluded from abandoning the mineral owner’s interest if the mineral interest has been the subject of a title transaction within twenty years preceding the filing of the action. In such a case, the court ruled that the surface owner is precluded from starting the notice process by which true dormant minerals may be deemed ‘abandoned’. The decision, issued by the Harrison County Common Pleas Court, offers the only thorough judicial discussion and analysis of Ohio Revised Code 5301.56 (“abandonment of mineral interest”) seen in recent years. Perhaps best known by the popularized name, the Ohio ‘Dormant Mineral Act’, the interpretation of 5301.56 by Ohio courts carries paramount importance for mineral owners in the Utica Shale. Notably, the Dodd decision (PDF and case summary below) applies to both the 1989 and 2006 versions of 5301.56 as a sufficiently recent reservation reference would preclude forfeiture by any means—automatic or notice based.
1. A mineral interest cannot be deemed ‘abandoned’ where the mineral interest attempting to be abandoned is the subject of a title transaction within the surface owner’s record chain of title within 5301.56′s 20-year look back period.
2. The “subject of a title transaction” encompasses any mineral interest included in the recorded deed instrument through the use of reservation language, including a recitation or reference to a prior mineral reservation.
Defendants are the record owners of the disputed mineral interests as the successor in interest to the grantor named in a 1947 deed transferring the overlying surface rights, and including language reserving the minerals to the grantor. Plaintiffs are the record owners of the surface estate, which they acquired in 2009. The mineral interest was the subject of numerous title transactions throughout Plaintiff’s chain of title in that it was included in the deed instruments memorializing each subsequent surface transfer from 1947 to the present, either by reference or recitation.
In 2010, the surface owners published a notice of intent to claim abandonment of the underlying oil and gas rights. One of the mineral owners recorded an ‘Affidavit Preserving Minerals’ less than 30 days after initial publication, well within the 60-day statutory period.
The surface owners proceeded to file an action requesting that the court issue a declaratory judgment declaring them the owners of the oil and gas rights by virtue of 5301.56 (Ohio’s ‘Dormant Mineral Act’). The mineral owners requested a declaratory judgment to the opposite effect.
Summary Judgment in favor of the mineral owners.
**The foregoing is for informational purposes only; it does not constitute legal advice.