Court Opinion

ID: 9555980
Source: CourtListenerOpinion
Date Created: 2023-08-15 18:12:01.881536+00
Date Added: 2024-06-11T15:35:49.100620
License: Public Domain

J-A11006-23

 NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT O.P. 65.37

  DOUGLAS EQUIPTMENT, INC.;                    :   IN THE SUPERIOR COURT OF
  DOUGLAS ENERGY, LLP; FIRST                   :        PENNSYLVANIA
  BAPTIST CHURCH OF WAYNESBURG;                :
  D & W RESOURCES, LP; AMY LYNNE               :
  MENDICINO AND MARK MENDICINO                 :
                                               :
                       Appellants              :
                                               :
                  v.                           :   No. 674 WDA 2022
                                               :
  EQT PRODUCTION COMPANY; GARY                 :
  N. LEE; DEBORAH H. CAMPBELL AND              :
  MARY H. ULAM, ADMINISTRATRICES,              :
  D.B.N.C.T.A OF THE ESTATE OF                 :
  WILLIAM E. HOLT, DECEASED;                   :
  DEBORAH H. CAMPBELL AND MARY                 :
  H. ULAM, EXECUTRICES OF THE                  :
  ESTATE OF NIRA W. HOLT,                      :
  DECEASED; ROBERT E. LEE AND                  :
  MICHELLE LEE, HUSBAND AND WIFE,              :
  ROBERT LEE 2015 IRREVOCABLE                  :
  TRUST; AND RICE DRILLING B LLC               :
                                               :
                       Appellees               :

                   Appeal from the Order Entered May 10, 2022
                 In the Court of Common Pleas of Greene County
                       Civil Division at No: AD No. 77-2017

BEFORE:      BENDER, P.J.E., STABILE, J., and PELLEGRINI, J.*

MEMORANDUM BY STABILE, J.:                          FILED: AUGUST 15, 2023

       Appellants (collectively “Douglas Appellants”) appeal from the May 10,

2022 order entered in the Court of Common Pleas of Greene County granting

summary judgment in favor of Appellees (collectively “EQT Appellees”) and

____________________________________________

* Retired Senior Judge assigned to the Superior Court.
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denying the Douglas Appellants’ motion seeking summary judgment against

the EQT Appellees.1 The Douglas Appellants contend that the trial court erred

in finding their oil and gas lease invalid and in finding the EQT Appellees’ oil

and gas lease valid. After careful review, we affirm.

       In many oil and gas lease cases, the factual history is lengthy and rather

convoluted. This case is no exception. However, the parties do not suggest

that any genuine issues of material fact are at issue here.        We offer the

following abridged version of facts pertinent to our review of the legal issues

before us.

       By deed dated August 31, 1972, the property in question (approximately

321 acres, referred to herein as “the Subject Land”) located in Gilmore

Township, Greene County, was conveyed to J.K. Willison and his wife,

Wynona, and to J. Kenneth Willison, Jr., and his wife, Sherry. The conveyance

included all oil and gas rights for the property. On August 12, 1987, J.K. and

Wynona Willison conveyed their undivided one-half interest in the property to

____________________________________________

1 The Douglas Appellants include Douglas Equipment, Inc.; Douglas Energy,

LLP; First Baptist Church of Waynesburg; D&W Resources, LP; Amy Lynne
Mendicino; and Mark Mendicino. The EQT Appellees include EQT Production
Company; Gary N. Lee; Deborah H. Campbell and Mary H. Ulam, as
Administratrices, D.B.N.C.T.A., of the Estate of William E. Holt, Deceased, and
as Executrices of the Estate of Nira W. Holt; Robert E. Lee and Michelle Lee,
husband and wife; Robert Lee 2015 Irrevocable Trust’ and Rice Drilling B LLC.
The roles of the parties will be discussed as pertinent to the matters raised in
this appeal. We note that Rice Drilling was dismissed from the action by
agreement of the parties, see Trial Court Order, 5/10/22, at ¶1, and is not a
party to this appeal, despite its name appearing in the caption.

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J.K., Jr., and Sherry Willison (hereinafter “the Willisons”).           Again, the

conveyance included oil and gas rights.

       On October 3, 1994, the Willisons entered into a lease with Douglas

Equipment covering the property (“the Douglas Lease”). At that time, one

vertical well was located on the property. Its operator transferred the well to

Douglas Equipment in May 1995.                 See Deposition of Douglas Galbraith,

12/17/20, at 51; Reproduced Record (“R.R.”) 611a.              As will be discussed

herein, the last production from the well occurred in October 2008. Id. at 54;

R.R. 612a.

       The Douglas Lease, which was not recorded initially,2 leased the land to

Douglas Equipment “for the purpose of exploring and operating for and

producing and saving oil and gas.” Douglas Lease, 10/3/94, at ¶ 1; R.R. 97a.

A provision set forth the duration of the lease as follows:

       3. DURATION OF LEASE – To have and to hold the said land
       and privileges for the said purposes for and during a period
       of 1 (one) year from date of signing and as long after
       commencement of operations on said land, or any portion
       thereof[,] . . . is operated for the exploration or production of gas
       or oil, or as gas or oil is found in paying quantities thereon[.]
       The Lessee shall have the right to shut-in any and all wells on said
       land on payment of a shut-in royalty as hereinafter set forth for a
       period up to three (3) years. Lessee has the further right to re-
       enter the lease following termination of the lease in order to plug
       any and all wells, reclaim the surface and comply with all
       applicable laws.

____________________________________________

2 The lease was eventually recorded in 2009, as an exhibit to a document that

purported to ratify the Douglas Lease.

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Douglas Lease, 10/3/94 at ¶ 3; R.R. 98 (emphasis added).3 The lease also

included terms for production royalties to be paid to the Willisons for

petroleum oil found and saved, and for each well that produced gas marketed

by Douglas. Id. at ¶ 5; R.R. 99-100. Further, the lease provided for annual

payments of $250 for up to three years as the shut-in royalty for wells no

longer profitable to operate. Id. at ¶ 7; R.R. 100-01.

       On July 26, 1999, while the Douglas Lease was in full force and effect,

the Willisons conveyed the Subject Land by general warranty deed (“1999

Deed”) to William E. and Nira W. Holt (undivided one-half interest) and Robert

Lee (undivided one-half interest) (together “Holts/Lee” or “the Holts and

Lee”). The 1999 Deed included five exceptions, two of which related to veins

of coal “within and underlying” the land, and two of which related to smaller

tracts of land previously conveyed by the Willisons. The final exception was

not for coal or other mineral rights or for tracts of land but rather was for “all

rights, title, and interest” in the Douglas Lease, except for the lease’s free gas

privilege for the personal use of the Holts/Lee purchasers. Deed, 7/26/99, at

2; R.R. 52a. (“Douglas Lease Exception”).         Importantly, the 1999 Deed

conveyed the Subject Lands to the Holts and Lee,

       TOGETHER with all and singular the rights, liberties, privileges,
       hereditaments, and appurtenances, whatsoever thereunto
       belonging, or in any wise appertaining, and the reversions and
       remainders, rents, issues, and profits thereof, and also, all the
____________________________________________

3 Because this case does not involve any claims relating to storage of gas, we

have redacted the lease provisions addressing storage on the land.

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      estate, right, title, interest, property, claim, and demand
      whatsoever, of them, the said Grantors in law, or equity, or
      otherwise howsoever, of, in, to, or out of the same.

      TO HAVE AND TO HOLD the premises hereby granted, or
      mentioned, or intended to be, with the appurtenances, unto the
      said Grantees, their heirs and assigns[.]

Id. at 3; R.R. 53a (emphasis added).

      As the trial court recounted, the Willisons and Douglas Equipment

entered into a “farmout agreement” in 2006 and as well as an exploration

agreement in 2009 with other entities. Both agreements included expiration

provisions that would kick in if no drilling took place within specified periods

of time. Both of those agreements terminated under those terms without any

drilling having occurred. Trial Court Opinion, 5/10/22, at 6-7.

      Production from the well subject to the Douglas Lease stopped in

October of 2008. Douglas Equipment made shut-in royalty payments to the

Willisons for the three subsequent years and beyond.

      On February 19, 2016, the Holts and Lee, along with a related trust,

entered into a lease with EQT (“EQT Lease”) for oil and gas underlying the

Subject Land. Id. at 7. On July 4, 2016, Douglas Equipment entered into a

term assignment of oil and gas lease with LOLA Drilling I LLC, which is not a

party to this litigation, and a ratification and cross-conveyance of oil and gas

estate ownership with several of the Douglas Appellants identified in n. 1,

supra.

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      On January 29, 2017, the Douglas Appellants filed a complaint

contending, inter alia, that the Douglas Lease remained in full force and effect;

that the Douglas Lease did not terminate when production stopped in 2008;

that the lease became an at-will lease subject to continuation by mutual

consent; and that the EQT lease would go into effect only upon expiration of

the Douglas Lease. In response, the EQT Appellees asserted that the Douglas

Lease expired once production ceased in October 2008 and shut-in royalties

were paid for the subsequent three years. Because the Douglas Lease had

expired, the ownership of the oil and gas rights reverted in accordance with

the 1999 Deed to the Holts and Lee, who then had the power to enter into the

lease with EQT. Id. at 7-8.

      After the pleadings were closed, the parties filed motions for summary

judgment, each contending that there were no genuine issues of material fact

and that each was entitled to summary judgment confirming their oil and gas

rights on the Subject Land. Argument was held on February 15, 2022.

      By order entered May 10, 2022, the trial court denied the Douglas

Appellants’ motion for summary judgment and dismissed their complaint with

prejudice. Order, 5/10/22, at ¶ 2. The court declared the Douglas Lease

invalid. Id. at ¶ 3. The court granted the EQT Appellees’ motion for summary

judgment and declared the EQT lease valid. Id. at ¶¶ 4, 5. This timely appeal

followed.   The Douglas Appellants complied with the order to file a Rule

1925(b) statement. In response, the trial court issued a Statement pursuant

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to Rule 1925, indicating that it was relying on its order and opinion filed on

May 10, 2022.

      The Douglas Appellants present one issue for our review that includes

two sub-parts as follows:

      1. Whether the trial court erred in granting summary judgment in
         favor of EQT and the Holts/Lees and in denying summary
         judgment to the Douglas Lease Parties, thereby declaring the
         EQT Leases valid and declaring the Douglas Lease invalid.

            A. Whether the trial court erred in failing to consider
               the all-encompassing language of “all right, title
               and interest” of the Douglas Lease Exception in
               determining the parties’ motions for summary
               judgment.

            B. Whether the Willison Heirs and the Willison Heirs
               and Assigns, as lessor, and Douglas Equipment, as
               lessee, have continued the at-will Douglas Lease in
               effect by mutual consent.

Appellants’ Brief at 2-3.

      Our standard of review of an order granting summary judgment

      requires us to determine whether the trial court abused its
      discretion or committed an error of law. Our scope of review is
      plenary. In reviewing a trial court’s grant of summary judgment,
      we apply the same standard as the trial court, reviewing all the
      evidence of record to determine whether there exists a genuine
      issue of material fact. We view the record in the light most
      favorable to the non-moving party, and all doubts as to the
      existence of a genuine issue of material fact must be resolved
      against the moving party. . . . Upon appellate review, we are not
      bound by the trial court’s conclusions of law, but may reach our
      own conclusions.

Hunnell as Trustee of Hunnell Family Revocable Living Trust v.

Krawczewicz, 284 A.3d 1192, 1197 (Pa. Super. 2022) (quoting Wright v.

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Misty Mt. Farm, LLC, 125 A.3d 814, 818 (Pa. Super. 2015) (citation

omitted)).

      The parties do not take issue with the trial court’s conclusion that there

are no genuine issues of material fact. Our review of the record confirms that

determination. Therefore, we shall review the legal analysis that led the trial

court to conclude that the Douglas Lease is invalid and the EQT Lease is valid.

      The trial court appropriately recognized that a careful review of both the

1994 Douglas Lease and the 1999 Deed from the Willisons to the Holts and

Lee is essential to resolving the issues presented in this case.    Trial Court

Opinion, 5/10/22, at 8.

      When analyzing a lease, the court must construe the terms of the lease

agreement “as manifestly expressed,” and “[t]he accepted and plain meaning

of the language used, rather than the silent intentions of the contracting

parties, determines the construction to be given to the agreement.” Willison

v. Consolidation Coal Co., 637 A.2d 979, 982 (Pa. 1994).

      In T.W. Phillips Gas & Oil Co. v. Jedlicka, 42 A.3d 261 (Pa. 2012),

our Supreme Court explained that under an oil and gas lease, if oil or gas is

produced, a fee simple determinable is created in the lessee, and the lessee’s

right to extract the oil or gas becomes vested.     Id. at 267.   A fee simple

determinable is an interest in land that will automatically end if a certain

specified event occurs. Id. (citing Brown v. Haight, 255 A.2d 508, 511 (Pa.

1969)). “The interest held by the grantor after such a conveyance is termed

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‘a possibility of reverter.’” Id. (quoting Higbee Corp. v. Kennedy, 428 A.2d

592, 595 (Pa. Super. 1981)).

      As noted above, the Douglas Lease included a “Duration” provision that

provided for an initial term of one year. As the trial court explained, the lease

would continue

      if: 1) pooled or unitized with any other land for the production of
      gas or oil, 2) or gas or oil is found in paying quantities or stored
      thereunder, 3) or is used for storage of gas or the production,
      monitoring or observation of gas storage on lands in the general
      vicinity. Further, the lessee had the right of paying shut in
      royalties for three years. Production ceased on the Douglas Lease
      wells in October, 2008, and shut in payments were made and
      accepted by the Willisons [for a period of time] well in excess of
      the three years and in fact continued to 2018.

      The Douglas lessees pursuant to paragraph two of the lease: “(a)
      could conduct surveys; (b) drill wells, produce, save, process, and
      sell and transport oil and gas, including the right to deepen,
      rework, or plug back in an existing well or other hole.” Further
      the Lessees, “have ingress and egress over, under, through, upon,
      and across the land for any of the Lessee’s operations hereunder.”

Trial Court Opinion, 5/10/22, at 8-9 (with minor edits).

      The trial court recognized that “[o]il and gas leases are not controlled

by normal landlord tenant law. The law has developed to provide that an oil

and gas lease despite the use of the term, ‘lease’ actually involves the

conveyance of property rights.” Id. at 9 (citing, inter alia, Nolt v. TS Calkins

& Associates, L.P., 96 A.3d 1042 (Pa. Super. 2014)). Further:

      The title conveyed in an oil and gas lease is inchoate, and is
      initially for the purpose of exploration and development. . . . If
      development during the agreed upon primary term is
      unsuccessful, no estate vests in the lessee. If, however, oil or gas
      is produced, a fee simple determinable is created in the lessee,

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      and the lessee’s right to extract the oil or gas [becomes
      vested]. A fee simple determinable is an estate in fee that
      automatically reverts to the grantor upon the occurrence of a
      specific event. The interest held by the grantor after such a
      conveyance is termed a possibility of reverter. Such a fee is a fee
      simple, because it may last forever in the grantee and his heirs
      and assigns[, t]he duration depending upon the concurrence of
      collateral circumstances which qualify and debase the purity of
      the grant.

Id. at 9-10 (quoting Nolt, 96 A.3d at 1046-47, in turn quoting Jedlicka,

42 A.3d at 267) (internal quotations and citations omitted).

      The trial court noted that a producing well was already in place at the

time the Douglas Lease was signed and that Columbia Gas conveyed the rights

to that well to Douglas in May of 1995. “Therefore, since a producing well was

in place, the Willisons’ interest under Pennsylvania law was a possibility of

reverter.” Id. at 10. “The plain language of the contract gave the Willisons

the right to royalties, the right to use gas for one household, and of course

the lessee retained full possession of said land for all purposes and uses not

inconsistent or interfering with the aforesaid purposes and rights of the

lessee.” Id. (citing Douglas Lease at ¶ 8). Moreover, the lease contained a

habendum clause, indicating that the duration of the lease was for “as long as

. . . gas or oil is found in paying quantities thereon.”   Id. at 11 (quoting

Douglas Lease at ¶ 3).

      The court analyzed the language of the lease in relation to rulings from

our Supreme Court and this Court, and recognized that:

      The Supreme Court has ruled that “where a lessor’s compensation
      is subject to a volume of production, the period of active

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      production of oil and gas is the measure of the duration of the
      lease.”     Clark v. Wright, 166 A. 775, 776 (Pa. 1933).
      Pennsylvania has also held that in an oil and gas lease for a fixed
      period and “as long thereafter as oil is found in paying quantities”
      where the lessor’s compensation is a percentage of the oil
      produced, the tenancy as to the surface of the land after
      expiration of the fixed period, and after the fact that oil is not
      found and produced in paying quantities becomes susceptible of
      proof, is a tenancy at will, and if not actually terminated by mutual
      consent, or continued by mutual consent in order that further
      exploration be made, may be terminated by either party. Cassell
      v. Crothers, 44 A. 446 (Pa. 1899). Similarly, in Heasley v. KSM
      Energy, Inc., 52 A.3d 341 (Pa. Super. 2012), the Court found
      the lease to be restricted in duration based upon production. The
      Superior Court in Heasley supported the finding of the trial court
      that the leaseholds became tenancies in the nature of a tenancy
      at will at the time production ceased. They thus became subject
      to termination by either party. Heasley, 52 A.3d at 347.

Id. (with minor edits).

      As the EQT Appellees recognize, an oil and gas lease “is in the nature of

a contract and is controlled by principles of contract law.” EQT Appellees’ Brief

at 29 (quoting Jedlicka, supra, 42 A.3d at 267). “An oil and gas lease ‘will

not be construed to create a perpetual term unless the intention is expressed

in clear and unequivocal terms.’”     Id. (quoting Hite v. Falcon Partners,

13 A.3d 942, 947-48 (Pa. Super. 2011) (quoting trial court with approval and

citing Sterle v. Galiardi Coal & Coke Co., 77 A.2d 669, 672 (Pa. Super.

1951)). Because the Douglas Lease terminated in 2011 in accordance with its

own terms, there was no basis upon which an extension could be authorized.

“[G]ratuitous shut-in payments beyond the three-year period and payments

made to [the Douglas Appellants] pursuant to agreements like the [2016]

Exploration Agreement, the LOLA Assignment, or any other agreement could

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not operate to extend the lease.” Id. at 30 (citing several excerpts from the

Reproduced Record).

       Importantly, the Douglas Lease did not include language authorizing the

parties to modify, amend, ratify, continue, or terminate the lease. Rather, it

simply provided that the lease would terminate if oil and gas were not

produced in paying quantities, and preserved to the Willisons only the right to

royalties, the right to use gas for their household, and the possibility of

reverter.4

       The trial court next considered the effect, if any, that the 1999 Deed

had on the Douglas Appellants’ assertion that an at-will tenancy extended

their rights and ability to enter into agreements after production stopped in

2008 and the shut in royalties were paid for three years. As reflected in the

excerpt from the 1999 Deed quoted above, the deed included an exception

for the Douglas Lease but then expressly conveyed all rights as well as

“reversions” and remainders to the Holts/Lee purchasers. Deed, 7/26/99, at

2-3.

       In analyzing the 1999 Deed, the trial court recognized that “[e]ffect

must be given to all language of the instrument, and no part shall be rejected

if it can be given a meaning.” Trial Court Opinion, 5/10/22, at 13. The court

____________________________________________

4 We note that the Holts/Lee purchasers did not sign any ratification or
assignments documents.

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found that the language in the Deed that included reversions was consistent

with 21 P.S. § 3 (Grantor’s entire estate and rights conveyed), which provides:

       All deeds or instruments in writing for conveying or releasing land
       hereafter executed,[5] granting or conveying lands, unless an
       exception or reservation be made therein, shall be construed to
       include all the estate, right, title, interest, property, claim, and
       demand whatsoever, of the grantor or grantors, in law, equity, or
       otherwise howsoever, of, in, and to the same, and every part
       thereof, together with all and singular the improvements, ways,
       waters, watercourses, rights, liberties, privileges, hereditaments,
       and appurtenances whatsoever thereto belonging, or in anywise
       appertaining, and the reversions and remainders, rents, issues,
       and profits thereof.

21 P.S. § 3. “What this means is that there is a statutory presumption that

all of the grantor’s rights are conveyed. Of course, if there are rights reserved

to the grantor in the deed, they will not pass to the grantee.” Trial Court

Opinion, 5/10/22, at 14 (citing Ladner Pennsylvania Real Estate Law, Fifth

Edition 16.05(J)).      “[T]he court concludes the Willisons conveyed all their

interests in the property to [the Holts and Lee], except for the exception and

reservations contained in the 1999 conveyance.” Id. at 15. However, that

Deed did not except any possibility of reverter. In fact, it specifically conveyed

to the Holts and Lee the right of reverter. “If the Willisons had wished to

except the possibility of reverter they would have simply said so.” Id. at 16.

“Pennsylvania has long recognized that the power to alienate a possibility of

reverter is in accordance with public policy favoring the alienability of land,

____________________________________________

5 The provisions of Section 3 were effective on April 30, 1925 and have not

been amended since.

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and thus permits the disposition of all reversionary interests, including the

possibility of reverter, by devise, grant, assignment or release.” Id. (quoting

Higbee Corp. v. Kennedy, 428 A.2d 592, 595 n. 5 (Pa. Super. 1981)).

       The court stated:

       The plain language of [the reservation included in the 1999 Deed
       from the Willisons to Holts/Lee] neither retained the surface estate
       or the possibility of reverter, however, the exception would have
       preserved important rights to the Willisons including the right to
       all royalties including the three years [of] shut-in royalties. Had
       the well on the property produced gas in marketable quantities for
       a hundred years, the Willisons, their heirs and assigns would have
       had the legal right to royalties. However, in 2008, the well
       stopped production and after the three years of shut-in payments
       the oil and gas lease expired by its own terms in approximately
       2011.

       The 1999 conveyance to the Holts/Lees, their heirs and assigns
       would have, by its terms and by Pennsylvania law, conveyed the
       surface estate and the possibility of reverter of the oil and gas
       rights as they were not excepted or reserved. With the expiration
       of the lease in approximately 2011, the oil and gas rights reverted
       to the Holts/Lees. A tenancy at will would have been created
       pursuant to Pennsylvania case law between Douglas and the
       Holts/Lees, their heirs and assigns.

       ...

       In our case, the Holts/Lees and their heirs and assigns, in signing
       oil and gas leases with EQT [and] then appearing in court to
       defend their clauses against Douglas would meet the
       requirements of the case law that any tenancy-at-will was
       terminated by the [Holts/Lees and their heirs and assigns].

Trial Court Opinion, 5/10/22, at 16-17.6

____________________________________________

6 Although the EQT Appellees contend that no at-will tenancy was created,
they do not take issue with the trial court’s ultimate conclusion that any such
(Footnote Continued Next Page)

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       Again, the trial court concluded that the Douglas Lease terminated in

2011 under its own terms. At that point, in light of the right of reversion

specifically granted to the Holts and Lee in the 1999 Deed, the oil and gas

estate reverted to the Holts and Lee. The EQT Appellees aptly summarize the

sequence of events and their legal ramifications as follows:

       As a result of the Douglas Lease, (1) Douglas Equipment held (a)
       a contractual right in the lease (which contained an express
       termination provision) and (b) a fee simple determinable in the oil
       and gas estate (which would terminate at the expiration of the
       lease); and (2) the Willisons held (a) a contractual right to
       royalties and (b) a future interest in the oil and gas estate (the
       possibility of reverter at the expiration of the lease).

       As a result of the 1999 Deed conveying the [Subject Land] from
       the Willisons to the Holts and Lee, (1) the Holts and Lee owned
       the possibility of reverter of the oil and gas estate (together with
       the surface and support estate); and (2) the Willisons held only a
       contractual right to royalties.

       When the Douglas Lease expired based on its express terms in
       2011, (1) Douglas Equipment’s fee simple determinable
       terminated as a matter of law and its contract rights terminated;
       (2) the oil and gas estate reverted to the Holts and Lee pursuant
       to the possibility of reverter they acquired in 1999; and (3) the
       Willisons’ only interest in the Property—a contractual right to
       royalties—terminated.

EQT Appellees’ Brief at 32 (with minor edits).

____________________________________________

tenancy would have been between Douglas Equipment and the Holts and Lee—
rather than between Douglas Equipment and the Willisons—and that any such
tenancy would have terminated at the time the Holts and Lee entered into the
EQT Lease and defended against the Douglas Appellants’ claim in court. See
EQT Appellees’ Brief at 34 n. 8 (citing Trial Court Opinion, 5/10/22, at 17).

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      The Douglas Appellants have filed a Reply Brief with this Court,

complaining that neither the trial court nor the EQT Appellees appreciated the

significance of the phrase, “all right, title, and interest,” which appears in the

Douglas Lease Exception.       Again, that exception specifically related to the

Douglas Lease—not to the oil and gas itself. By contrast, two of the remaining

four exceptions related to the actual coal veins beneath the Subject Land,

while the other two related to smaller tracts previously conveyed by the

Willisons. As explained above, the Douglas Lease expired by its own terms

after production ceased in 2008 and shut-in payments were made. At most,

an at-will tenancy survived beyond 2011, but was terminated when the Holts

and Lee entered into the EQT Lease and defended against the Douglas

Appellants’ claims in court.     In either event, the Willisons could not have

excepted any “right, title or interest” in the lease greater than the rights

included in a lease itself. By virtue of the language of the lease, which expired

under its own terms, coupled with the language of the 1999 Deed, which

conveyed the right of reversion to the Holts and Lee, the Willisons did not

retain any “right, title or interest” in the Douglas Lease beyond the royalties.

The Douglas Appellants’ argument lacks merit.

       Based on the foregoing, we conclude that the trial court did not err in

granting summary judgment in favor of the EQT Appellees or in denying

summary judgment in favor of the Douglas Appellants. The court properly

considered and correctly analyzed the language of the Douglas Lease and the

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language of the 1999 Deed and concluded that the Willisons conveyed their

right of reversion while retaining only the rights to royalties following the sale

of the Subject Land. Consequently, even if an at-will tenancy survived the

termination of the Douglas Lease in 2011, that tenancy expired when the Holts

and Lee entered into the EQT lease and defended against the Douglas

Appellants’ claims in court. Therefore, we shall affirm the trial court’s May 10,

2022 order granting summary judgment to the EQT Appellees and declaring

the EQT Lease valid and further affirm the court’s order denying summary

judgment in favor of the Douglas Appellants and declaring the Douglas Lease

invalid.

      Order affirmed.

Judgment Entered.

Joseph D. Seletyn, Esq.
Prothonotary

Date: 8/15/2023

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