Court Opinion

ID: 4572017
Source: CourtListenerOpinion
Date Created: 2020-10-01 17:12:13.295613+00
Date Added: 2024-06-11T08:47:06.772424
License: Public Domain

[Cite as Cain Ridge Beef Farm, L.L.C. v. Fisher, 2020-Ohio-4727.]

             IN THE COURT OF APPEALS OF OHIO
                             SEVENTH APPELLATE DISTRICT
                                  MONROE COUNTY

                         CAIN RIDGE BEEF FARM, LLC ET AL.,

                                        Plaintiffs-Appellees,

                                                     v.

                                EDNA LYDIA FISHER ET AL.,

                                     Defendants-Appellants.

                       OPINION AND JUDGMENT ENTRY
                                        Case No. 19 MO 0024

                                    Civil Appeal from the
                        Court of Common Pleas of Monroe County, Ohio
                                     Case No. 2018-138

                                        BEFORE:
                 Gene Donofrio, Carol Ann Robb, David A. D’Apolito, Judges.

                                              JUDGMENT:
                                               Reversed

Atty. Timothy Pettorini, Roetzel & Andress, LPA, 222 South Main Street, Suite 400, Akron,
Ohio 44308, and Atty. Sara Fanning, Roetzel & Andress, LPA, 41 South High Street,
Huntington Center, 21st Floor, Columbus, Ohio 43215, for Plaintiffs-Appellees and
                                                                                      –2–

Atty. Erik Schramm Sr. and Atty. Erik Schramm Jr., Hanlon, Estadt, McCormick &
Schramm Co., 46457 National Road West, St. Clairsville, Ohio 43950, for Defendants-
Appellants.

                                        Dated:
                                  September 30, 2020

DONOFRIO, J.

      {¶1}     Defendants-appellants, Frost Bank as Trustee of the Geoffrey Strauch
Generation Skipping Trust, Geoffrey Strauch, Howard Strauch, JoAnn Strauch, Scott
Strauch, William Strauch, Elaine Strauch, Robert Strauch, Mary Helene Strauch, Matthew
Cooper, Jennifer Cooper, David Alan Clements, Cynthia Scott Strauch Smagula, Nancy
Anne Clements Hand, Gregory Hand, Jill Vaugh Johnson, Greg Johnson, Patricia Carolyn
Dixon, Fred Preston Clements, Jr., Julie Ann Clements, George Clements, Leigh
Seklemian as Trustee of the Robert Seklemian Trust, Robert Seklemian, Adam Cooper,
Irene Elizabeth Cooper, Warren Clements, Carol Clements, John Bowman, Barbara
Bowman, Charlene Bowman, Elizabeth Bowman Robinson, Mary Kaye Seigfreid, Roy
Seigfreid, David Cooper, Valerie Cooper, Thomas Strauch, Lynn Strauch, Mary Strauch,
Nancy Ruth Strauch, James Strauch, Karen Strauch, Timothy Strauch, Arlene Strauch,
Martha Bell, and Joseph Bell, appeal the judgment of the Monroe County Common Pleas
Court granting summary judgment and quieting title to real property in favor of plaintiffs-
appellees, Cain Ridge Beef Farm, LLC, Mark Milosavljevic, and Terri Milosavljevic.
      {¶2}     In 1907, Henry and Mary Strauch owned 113.13 acres of real property in
Monroe County, Ohio (the property). In a warranty deed dated October 14, 1907, Henry
and Mary Strauch conveyed the property to Charles Miller (the Strauch deed). In the
Strauch deed, Henry and Mary reserved one-half of all the oil and gas underlying the
property (the Strauch reservation).
      {¶3}     Henry died intestate in 1944.      On August 29, 1944, Henry’s estate
conveyed his interest in the Strauch reservation to seven heirs: Oscar Elmer Strauch,
Selma Louise Strauch, Emil Sampson Strauch, Albert Wesley Strauch, Edna Lydia
Strauch, Elizabeth Esther Strauch, and Alice Winona Strauch (the Strauch heirs).
      {¶4}     Appellants are the heirs of Henry and Mary Strauch and claim complete
ownership of the Strauch reservation.

Case No. 19 MO 0024
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       {¶5}     In five separate deeds between 1977 and 2005, appellees Mark and Terri
Milosavljevic acquired the surface rights and one-half of the mineral rights to
approximately 95.383 acres of the property. On September 28, 2012, the Milosavljevics
executed an oil and gas lease on the property with CNX Gas Company.
       {¶6}    In 2014, the Milosavljevics retained the law firm of Stubbins, Watson,
Bryan & Witucky Co., LPA (Stubbins Firm) for the purposes of identifying the current
holders to the Strauch reservation.         The Stubbins Firm retained Attorney Kristi
Rothenbuhler to conduct the title examination of the Strauch reservation.
       {¶7}     Attorney Rothenbuhler conducted a search for the holders of the Strauch
reservation by examining Monroe County Records covering a time period from October
14, 1907 to October 17, 2014. Attorney Rothenbuhler’s search only identified the Strauch
heirs and did not identify appellants as the current holders.
       {¶8}    On November 12, 2014, the Milosavljevics conveyed their interest in the
property to appellee Cain Ridge Beef Farm, LLC (Cain Ridge). The Milosavljevics are
the sole owners and members of appellee Cain Ridge.
       {¶9}    Between November 5, 2014 and January 2, 2015, appellees attempted to
serve their notice of intent to abandon severed mineral interests to the Strauch Heirs by
certified mail, return receipt requested. All attempts to serve the Strauch Heirs were
returned “unclaimed unable to forward” or “attempted – not known unable to forward.”
       {¶10}   On February 26, 2015, appellees published their notice of intent to declare
the Strauch Heirs’ interest in the Strauch reservation abandoned in the Monroe County
Beacon. This published notice listed the Milosavljevics as the surface owners to the
property.
       {¶11}   On April 10, 2015, appellees filed their affidavit of abandonment with the
Monroe County Recorder. This affidavit listed the Milosavljevics as the surface owners
to the property and one-half of all of the oil and gas underlying the property.
       {¶12}   On June 2, 2015, appellees filed their notice of failure to file. This notice
also identified appellees the Milosavljevics as the surface owners of the property and one-
half of all of the oil and gas underlying the property.

Case No. 19 MO 0024
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         {¶13}   At various points between September of 2016 and January of 2017,
appellants purported to lease their interest in the Strauch reservation to CNX Gas
Company.
         {¶14}   On April 5, 2018, appellees filed a complaint seeking a declaratory
judgment that appellants’ interest in the Strauch reservation was abandoned and that the
oil and gas leases executed by appellants were void and seeking to quiet title in their
favor.
         {¶15}   Both parties filed motions for summary judgment.        Appellees’ motion
argued that, under the Ohio Dormant Mineral Act (ODMA), appellants’ interest in the
Strauch reservation was abandoned and the Strauch reservation vested in the surface.
         {¶16}   Appellants’ motion argued that their interest in the Strauch reservation was
not abandoned under the ODMA. Among other arguments, appellants claimed that
appellees did not exercise reasonable diligence under the ODMA in attempting to identify
the current interest holders. They also argued that that the ODMA required the surface
owner to perform the abandonment procedure. During the abandonment procedure,
appellee Cain Ridge was the surface owner of the property. But it was the Milosavljevics
who completed the abandonment procedure.
         {¶17}   The trial court granted appellees’ motion for summary judgment and
denied appellants’ motion for summary judgment. The trial court held that although Cain
Ridge was technically the surface owner, the Milosavljevics were the sole owners and
members of Cain Ridge. Therefore, under this court’s decisions in Paul v. Hannon, 7th
Dist. Carroll No. 15 CA 0908, 2017-Ohio-1261, and Jefferis Real Estate Oil and Gas
Holdings, LLC v. Schaffner Law Offices, L.P.A., 7th Dist. Belmont No. 17 BE 0042, 2018-
Ohio-3733, appellees substantially complied with the ODMA provisions despite the
abandonment filings listing appellees Mark and Terri Milosavljevic as the surface owners.
The trial court also held that appellees complied with all other ODMA provisions and, as
a matter of law, appellee Cain Ridge was entitled to the property’s oil and gas rights.
         {¶18}   Appellants timely filed their notice of appeal on December 13, 2019. They
now raise five assignments of error.
         {¶19}   We will address appellants’ assignments of error out of order for ease of
discussion.

Case No. 19 MO 0024
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       {¶20}     Appellants’ second assignment of error states:

                 THE TRIAL COURT ERRED IN FAILING TO DETERMINE
       APPELLEES’ LACKED STANDING.

       {¶21}     Appellants argue that all appellees lack standing.      They contend the
Milosavljevics lack standing because, at all times during the abandonment procedure,
they were not the legal owners of the property.          Therefore, appellants assert, the
Milosavljevics did not have a legal interest in reuniting the property’s minerals with the
surface. As for Cain Ridge, appellants argue that it lacks standing because it made no
attempt to initiate the abandonment procedure.
       {¶22}     In order to have standing, a party, in an individual or representative
capacity, has to have some real interest in the action. Youngstown Edn. Assn. v. Kimble,
7th Dist. Mahoning Nos. 16 MA 0013, 16 MA 0014, 2016-Ohio-1481, ¶ 12 citing State ex
rel. Dallman v. Court of Common Pleas, 35 Ohio St. 2d 176, 298 N.E.2d 515 (1973).
“Because standing to sue is required to invoke the jurisdiction of the common pleas court,
‘standing is to be determined as of the commencement of suit.’” Federal Home Loan
Mortg. Corp. v. Schwartzwald, 134 Ohio St. 3d 13, 2012-Ohio-5017, 979 N.E.2d 1214, ¶
24 quoting Lujan v. Defenders of Wildlife, 504 U.S. 555, 112 S. Ct. 2130, 119 L. Ed. 2d 351
(1991), fn. 5.
       {¶23}     At the commencement of this action, Cain Ridge owned the surface of the
property and the Milosavljevics were the sole owners and members of Cain Ridge.
Appellees’ complaint raised four causes of action: declaratory judgment that appellants’
interest in the Strauch reservation was abandoned under the ODMA; quiet title to
appellants’ interest in the Strauch reservation; declaratory judgment that the oil and gas
leases executed by appellants were void; and quiet title regarding the oil and gas leases
executed by appellants. The fact that Cain Ridge was the surface owner at the time this
action was initiated gives it standing because it has an interest in the property which is
the subject of this action.
       {¶24}     Appellants’ argue that Cain Ridge lacks standing because it did not initiate
the abandonment procedure, the Milosavljevics did. This is a substantive argument

Case No. 19 MO 0024
                                                                                          –6–

based on the claims appellees raised in this case, not a standing-based argument. As
Cain Ridge is the surface owner of the property, it has a real interest in this action.
       {¶25}    The Milosavljevics also have standing in this case. The complaint states
that the Milosavljevics are the sole members of Cain Ridge. As Cain Ridge has a real
interest in this action, the Milosavljevics, as Cain Ridge’s sole owners, also have a real
interest in this action. Based on the above, all appellees had standing to bring this action.
       {¶26}    Accordingly, appellants’ second assignment of error is without merit and
is overruled.
       {¶27}    Appellants’ fifth assignment of error states:

                THE TRIAL COURT ERRED IN DETERMINING APPELLEE CAIN
       RIDGE BEEF FARM, LLC COMPLIED WITH THE ABANDONMENT
       PROVISIONS OUTLINED IN R.C. 5301.56.

       {¶28}    A court may grant summary judgment only when (1) no genuine issue of
material fact exists; (2) the moving party is entitled to judgment as a matter of law; and
(3) the evidence can only produce a finding that is contrary to the non-moving party.
Mercer v. Halmbacher, 9th Dist. Summit No. 27799, 2015-Ohio-4167, ¶ 8; Civ.R. 56(C).
The initial burden is on the party moving for summary judgment to demonstrate the
absence of a genuine issue of material fact as to the essential elements of the case with
evidence of the type listed in Civ.R. 56(C). Dresher v. Burt, 75 Ohio St. 3d 280, 292, 662
N.E.2d 264 (1996). If the moving party meets its burden, the burden shifts to the non-
moving party to set forth specific facts to show that there is a genuine issue of material
fact. Id.; Civ.R. 56(E). “Trial courts should award summary judgment with caution, being
careful to resolve doubts and construe evidence in favor of the nonmoving party.” Welco
Industries, Inc. v. Applied Cos., 67 Ohio St. 3d 344, 346, 617 N.E.2d 1129 (1993).
       {¶29}    Appellants raise numerous arguments in this assignment of error but
generally argue that appellees failed to comply with several aspects of the ODMA’s
abandonment procedure. First, they argue that appellees’ notice of intent, affidavit of
abandonment, and notice of failure to file were all defective because they listed the
Milosavljevics as the surface owners, not Cain Ridge. Second, they argue that the notice
of abandonment and the notice of failure to file were defective because they did not

Case No. 19 MO 0024
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contain a sufficient description of the property. Third, they argue that it was inappropriate
for appellees to publish the notice of abandonment because appellees did not conduct a
reasonable search to identify appellants as the current interest holders.
       {¶30}    We begin with appellants’ argument that appellees’ abandonment
documents are defective because they did not identify the true owner. Pursuant to R.C.
5301.56(F)(2), the notice of abandonment shall contain:

       A description of the surface of the land that is subject to the mineral interest.
       The description shall include the volume and page number of the recorded
       deed or other recorded instrument under which the owner of the surface of
       the lands claims title or otherwise satisfies the requirements established in
       division (A)(3) of section 5301.52 of the Revised Code.

       {¶31}    The ODMA contains similar surface owner language with regard to the
affidavit of abandonment. Pursuant to R.C. 5301.56(E)(2), “the owner of the surface of
the lands subject to the interest” shall file an affidavit of abandonment containing all of the
information specified in R.C. 5301.56(G). Pursuant to R.C. 5301.56(G)(1), the affidavit
of abandonment shall contain “[a] statement that the person filing the affidavit is the owner
of the surface of the lands subject to the interest.”
       {¶32}    The ODMA further contains similar surface owner language with regard to
the notice of failure to file. Pursuant to R.C. 5301.56(H)(2), if an interest holder fails to
timely file a claim to preserve the interest or fails to timely file an affidavit describing a
savings event, “the owner of the lands subject to the interest who is seeking to have the
interest deemed abandoned and vested in the owner shall file in the office of the county
recorder of each county where the land that is subject to the mineral interest is located a
notice of failure to file.” The notice shall contain, among other things, a statement that
the person filing the notice is the owner of the lands subject to the interest.            R.C.
5301.56(H)(2)(a).
       {¶33}    The repeated references in the ODMA to “surface owner,” “owner of the
surface,” or “owner of the lands” indicates the legislature’s intent that the surface owner
must be the party to complete the abandonment filings. In this case, it is undisputed that

Case No. 19 MO 0024
                                                                                       –8–

all of abandonment filings list the Milosavljevics. It is also undisputed that Cain Ridge
was the true surface owner.
      {¶34}   Appellees argue that under this court’s decisions in Paul, supra, and
Jefferis, supra, they were only required to substantially comply with the ODMA. They
argue that even though Cain Ridge is the surface owner, the Milosavljevics are the sole
owners and members of Cain Ridge. Thus, they argue because the Milosavljevics owned
Cain Ridge and Cain Ridge owned the surface, they substantially complied with the
ODMA.
      {¶35}   The problem with this argument is that the ODMA states several times that
the surface owner is to file the abandonment documents. Even though Cain Ridge is the
surface owner, at no point did it file any of the abandonment documents. Moreover, the
Milosavljevics knew they were not the surface owners because they conveyed the
property to Cain Ridge on November 12, 2014, less than three months before they
published their notice of intent in the Monroe County Beacon.
      {¶36}   Appellees also argue that the Milosavljevics were acting on behalf of Cain
Ridge because even if Cain Ridge completed the abandonment procedure, it would have
been the Milosavljevics who signed everything on behalf of Cain Ridge. But none of the
abandonment documents indicate that the Milosavljevics were acting on behalf of Cain
Ridge. To the contrary, the abandonment documents state that the Milosavljevics were
the surface owners despite the fact that Cain Ridge owned the surface.
      {¶37}    Based on the above, appellees’ abandonment filings did not comply with
the ODMA because they do not identify the correct surface owner. Since appellees’
abandonment documents did not comply with the ODMA, the trial court erred when it
granted summary judgment in favor of appellees.
      {¶38}   Accordingly, appellants’ fifth assignment of error has merit and is
sustained.
      {¶39}    Appellants’ first, third, and fourth assignments of error each allege another
reason summary judgment in favor of appellees was improper.
      {¶40}    Appellants’ first assignment of error states:

              THE TRIAL COURT ERRED BY NOT RECOGNIZING THE LEGAL
      DISTINICTION OF OWNERSHIP BETWEEN CAIN RIDGE BEEF FARM,

Case No. 19 MO 0024
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       LLC (THE SURFACE OWNER) AND CAIN RIDGE BEEF FARM, LLC’S
       MEMBERS MARK MILOSAVLJEVIC AND TERRI MILOSAVLJEVIC AS
       INIDIVIDUALS UNDER THE LIMITED LIABILITY COMPANY STATUTES,
       R.C. 1705.01 ET. SEQ., AND INTERPRETING CASE LAW.

       {¶41} Appellants’ third assignment of error states:

               THE TRIAL COURT ERRED IN DETERMINING PAUL V. HANNON,
       2017-OHIO-1261 (7TH APP. DIST., 2017) AND JEFFERIS REAL ESTATE
       OIL AND GAS HOLDINGS, LLC. V. SHAFFNER LAW OFFICES, L.P.A.,
       2018-OHIO-3733 (7TH APP. DIST., 2018) ARE APPLICABLE TO
       ABANDONMENT PROCEEDINGS PURSUANT TO THE OHIO DORMANT
       MINERAL ACT, R.C. 5301.56.

       {¶42}   Appellants’ fourth assignment of error states:

               THE TRIAL COURT ERRED IN FAILING TO HOLD THE
       ABANDONMENT PROVISIONS OUTLINED IN R.C. 5301.56 ARE
       MANDATORY.

       {¶43}    Based on our resolution of appellants’ fifth assignment of error, appellants’
first, third, and fourth assignments of error are moot.
       {¶44}    For the reasons stated above, the trial court’s judgment is hereby reversed
and summary judgment is entered in favor of appellants.

Robb, J., concurs.

D’Apolito, J., concurs.

Case No. 19 MO 0024
[Cite as Cain Ridge Beef Farm, L.L.C. v. Fisher, 2020-Ohio-4727.]

        For the reasons stated in the Opinion rendered herein, the assignments of error
are sustained and it is the final judgment and order of this Court that the judgment of the
Court of Common Pleas of Monroe County, Ohio, is reversed and summary judgment is
entered in favor of appellants. Costs to be taxed against the Appellee.
        A certified copy of this opinion and judgment entry shall constitute the mandate in
this case pursuant to Rule 27 of the Rules of Appellate Procedure. It is ordered that a
certified copy be sent by the clerk to the trial court to carry this judgment into execution.

                                       NOTICE TO COUNSEL

        This document constitutes a final judgment entry.