Legal
Updates
Dormant Mineral Act—“Ignorance of a Mineral Owner’s Last Known Location is No Excuse”
Ohio
In Fonzi v. Brown, the Supreme Court of Ohio consolidated and examined two cases to determine whether the surface owners of two adjoining parcels of land satisfied the requirements of Ohio’s Dormant Mineral Act (“DMA”) in seeking to have certain mineral interests deemed abandoned.[1] Specifically, the Court analyzed whether the surface owners exercised “reasonable diligence” in attempting to identify all owners of the allegedly abandoned minerals. For the reasons discussed below, the Court held that the surface owners in both cases did not exercise reasonable diligence in attempting to the identity the mineral interest owners. In both cases, the surface owners had knowledge that the mineral interest holders did not reside within the county where the land was located. Nevertheless, the surface owners failed to search any public records beyond the county where the mineral interests were located. Additionally, the Court held that the DMA provides for only one method of abandonment and that in subsequent actions, the surface owner has the burden of proving whether they exercised reasonable diligence in complying with the DMA’s notification requirements. [2] In both cases, Elizabeth Fonzi acquired the subject parcels located in Monroe County, Ohio, in 1952. Later, she transferred the surface rights to the predecessors- in-interests of the current surface owners (the Millers as to one parcel and the Browns as to the other) and reserved the oil and gas rights in both parcels. Importantly, the deed transferring the surface estate from Elizabeth to the Miller’s predecessors- in-interest expressly stated that Fonzi resided in Finleyville,Washington County, Pennsylvania. [3] Similarly, the deed transferring the property into Fonzi as to the Brown parcel noted that Fonzi resided in Finleyville,Washington, County, Pennsylvania.[4] In other words, both recorded chains of title contained recitals that Elizabeth Fonzi did not reside where the parcels at issue were located.
In Ohio, the DMA provides a mechanism for reuniting abandoned, severed mineral interests with the surface estate. The mechanism is called abandonment and is not available until 20 years pass without the occurrence of a saving event.[5] Even after 20 years have passed, the DMA requires that the surface owner serve personal notice by certified mail to the mineral owner(s). If service by mail cannot be completed, then notice by publication is allowed. The notice procedure to the DMA was added in 2006 by amendment, and its purpose is to give the mineral owner an opportunity to respond and preserve their mineral interest.[6] In both cases, the surface owners sought to have the Fonzi mineral interests deemed abandoned. The surface owners then hired an attorney who failed to uncover any information about Elizabeth Fonzi or locate any potential heirs after searching the Monroe County, Ohio public records and conducting limited internet Monroe County.As a result, no personal notice was served upon any of the Fonzi heirs or assigns. Subsequently, the surface owners published notices of intent to declare the Fonzi mineral interests abandoned in the Monroe County newspaper.[7] In analyzing these cases, the Court first confirmed that the DMA provides for only one method of abandonment and that the 2006 amendment merely made the one method more robust. Thus, the Court rejected the surface owners’ contention that the 2006 amendment created two different methods for abandonment.[8] Next, the Court emphasized the surface owners’ failure to make any attempt to search the records of Washington County, Pennsylvania, despite being aware that it was the last known location of the mineral interest owner, as noted in the chain of title. The Court reasoned that unlike the surface owner in Gerrity v. Chervenak,[9] the surface owners here failed to exercise reasonable diligence because they disregarded last known information about the residence of the mineral owner.[10]
G rowth T hrough E ducat i on - O c tober / N ov ember / D e c ember 2022 13
Made with FlippingBook Digital Proposal Creator