National Association of Division Order Analysts January / February / March 2025
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Volume MMXXV • No 1
www.NADOA.org
Contents Feature
Articles
NADOA 2025 Officers President Kimberly Bowman 1st Vice President Jean Hinton 2nd Vice Presiden t Armando Lopez Treasurer Iris Alcantara Corresponding Secretary Nichole Dwire, CDOA Recording Secretary Samantha Rodelo
Institute Preview: Cheers to Education in Boston!...........8 Legal Updates Cardinal Minerals v Miller (Ohio)...................................14 Dellit v Schleder (Montana)................................................15 ConocoPhillips v Hahn (Texas)........................................21 New Mexico State Lands Office.......................................... 25 National Niche USEPA Approves West Virginia Primacy Request.......26 Offshore Drilling Update.....................................................27
In This
Issue
The NADOA News Magazine is a quarterly publication of the National Association of Division
President’s Corner.............................................................1 Decimal Points....................................................................2 Certification......................................................................... 3 Cob Webs...............................................................................4 Member Recognition Nominations...............................5 2026 Board of Directors Nominations.......................6 Headshot Survey................................................................6 Ellis Rudy Memorial Scholarship Application........7 New Members....................................................................29 Counterpart Connection................................................30 2025 NADOA Board and Committee Chairs............36 Calendar of Events..........................................................37
Order Analysts P O Box 1656 Palm Harbor, FL 34682
Subscription: By membership to NADOA, at $100.00 per year. News Magazine Editor Rona L. Erickson, CDOA magazine@nadoa.org
Graphic Design, Paul Beach
On the Cover: View of Boston across the Charles River Photo Courtesy of The Westin Copley Place
All rights reserved. No part of this publication may be reproduced/copied without written permission. Editorial disclaimer: The contents of this newsletter are intended for member use only and any other use without permission from the NADOA Board of Directors is strictly prohibited. Articles published herein represent the view of the authors; publication neither implies approval of the opinions expressed nor accuracy of the facts stated and NADOA accepts no liability for misprints.
President’s
Corner
Kimberly A. Bowman 2025 NADOA President
Welcome to 2025 – A Year of Growth and Celebration with NADOA! The arrival of 2025 is not just the turning of a calendar page—it is a moment of reflection and anticipation. Time moves swiftly, yet with it comes opportunity, innovation, and the unwavering commitment of our industry to evolve and excel. With great gratitude, I step into the role of President this year, honored to serve such a dedicated and accomplished group of professionals. This milestone marks my 28th year in the energy sector, and as I look ahead, I am energized by the potential that lies before us. Celebrating 52 Years of NADOA NADOA stands as a pillar of knowledge, collaboration, and professional excellence in the oil and gas industry. For more than five decades, we have fostered an extraordinary organization that thrives on education, shared expertise, and meaningful connections. This year, as we celebrate our 52nd anniversary, we do so in a city that embodies both history and progress—Boston. Save the Date: 2025 NADOA Annual Institute Mark your calendars for August 27-29, 2025, when we will gather at The Westin Copley Place, a stunning venue in the heart of Boston’s historic Back Bay. Steps away from the iconic Boston Public Library and a short stroll from the charm of Newbury Street, the location offers an experience that blends the past with the future. Boston’s rich history is woven into every street and landmark, offering something for every traveler. Whether you find inspiration along the Freedom Trail, immerse yourself in the art and architecture of the Isabella Stewart Gardner Museum, or take in the electric atmosphere of Fenway Park, the city invites exploration at every turn. A Dynamic Start to 2025 This year is already shaping up to be one of engagement and momentum. In the month of February, Vicki Danielson, Betty Davidson, Riham Chahine, and I had the privilege of attending the NAPE Summit in Houston—an event that continues to set the bar for networking and industry collaboration. Shortly after, our 1Q Executive Board, Institute, and Committee Meetings took place at The Westin Copley Place, where the planning for our Annual Institute began to take shape. With a remarkable lineup of speakers and sessions in the works, this year’s event promises to be one of our most compelling yet. Looking Ahead My goal for 2025 is to get you more involved in NADOA and to celebrate the success of our mentors, past presidents, and founding fathers. Their dedication and vision built the foundation upon which we stand today, and it is through active participation that we continue to strengthen and grow.
In a world that never stands still, the time to invest in yourself, your career, and your connections is now. NADOA is more than an organization—it is a place where expertise is shared, leadership is cultivated, and futures are shaped.
We look forward to welcoming you to Boston, where history and innovation converge. Here’s to a year of growth, opportunity, and celebration!
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NADOA
Decimal Points
Second Quarter...................................... May 2 Special Institute Edition......................... June 6 Third Quarter..............................September 12 Fourth Quarter............................November 14 2025 News Magazine Deadlines NADOA online Job Bank has new postings. Visit https://nadoa.wildapricot.org/page-662233 ADVERTISE WITH NADOA Advertising in the NADOA Newsmagazine is a great way to get your business name out to NADOA members. Contact Cheryl Hampton at champton@limerockresources.com for details.
Regional Reporters
ABADOA
Steptoe & Johnson PLLC Ryan.daniels@steptoe-johnson.com
CAPDOA DADOA
OPEN
Kelly Sandoval, CDOA Kelly.sandoval@sitio.com
DALWORTH Lewis Box, CDOA lewis.box@gmail.com HADOA Emily Sheffield
esheffield@oglawyers.com
PBADOA
OPEN
SADOA
Dena Blevins dblevins@frontierland.net
Arkansas
OPEN
Kansas
Amy Flaming Amy.flaming@chsinc.com Kimberly A. Backman kbackman@crowleyfleck.com Zachary P. Oliva zoliva@oglawyers.com Margaret Patton mpatton@pattonfirm.com
North Dakota
New Mexico
2025 News Magazine Team
Louisiana
Be sure to keep your NADOA directory information up to date. With the many changes happening in our industry and the world, staying connected with professional contacts and taking full advantage of the educational opportunities NADOA membership offers has never been more crucial. If you have a suggestion for someone to act as a Regional Reporter to help NADOA keep abreast of current legislation and legal issues for a region, please submit the name or name of the firm to magazine@nadoa.org .
Rona Erickson , CDOA Editor
Melanie White, CDOA Associate Editor
Susan Bradley, CDOA Associate Editor
Somchay Fairbanks, CDOA Associate Editor
Sara Buck Associate Editor
Cheryl Hampton Associate Editor, Advertising
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CANDIDATES FOR CERTIFICATION Publication of the following “Certified Division Order Analyst” applicant(s) fulfills the requirement as stated in the Voluntary Certification Policy, III C.2 which states: “…applicant’s name will be published in the NADOA Newsletter or other official publication of NADOA.” This allows the NADOA membership an opportunity to present objections to the certification of the applicant. Any objection to the certification of the applicant must be in writing and signed by a NADOA member or non-member who qualifies his knowledge and objection of the applicant. All such letters will be considered confidential and must be received by the NADOA Certification Committee at the following address within thirty (30) days following the last day of the month in which the Newsletter or other official publication of NADOA was published: NADOA Certification Committee P O Box 1656 Palm Harbor, FL 34682 If the objection warrants denial of the certification or temporary withholding of certification, the applicant will be notified by Certified Mail. CANDIDATE FOR CERTIFICATION CANDIDATES FOR RECERTIFICATION Anthony B. Daniel – Dallas, TX Sara K. Bolen - The Woodlands, TX Lewis E. Box - Houston, TX CONGRATULATIONS TO THE FOLLOWING NEW CDOA!! Mikayla Inlow – Houston, TX Nicholas Brewer - Houston, TX Randolph V. Keeney, Jr. – Houston, TX Stanley Vargas - Denver, CO Melanie J. White – Houston, TX
CERTIFICATION The CDOA Committee is seeking CDOAs interested in recording webinars for Sections 1 and 2 of the CDOA Study Guide. As we develop an online study group for those pursuing CDOA certification, we are looking for CDOAs interested in contributing to the CDOA study guide updates. If you are currently a CDOA (Active or Retired) and would be interested in assisting with this project, let us know! Section 1 Chapter 1: An Overview of Oil and Gas Industry Chapter 2: Elements of the lease Chapter 3: Overview of the Division Order Process Chapter 4: Contracts Affecting the Division Order Analyst Section 2 Chapter 5: Analyze This, Calculate That Chapter 6: Calculations from your Title Opinion to your Computer Chapter 7: Review of Pooling and Unitizing Chapter 8: Issues Affecting Ownership Webinar
CDOA Committee 2025 Stephanie D. Moore – Chair and Liaison to NADOA Board Nora Marquez - Testing Kelly Sandoval – New Applicants/Testing Amber Croisant – Emails/Recertification Mindy Warren – Credit Approvals Janet Cavanah – Credit Approvals Connie Wilcoxson – Forms/Procedures Sonya Turner – Recertification
OPEN – Coordinator of Study Guide Activities (oversee committee to handle webinars needed for Sections 1 and 2, put together a regular study group for those testing, Study Guide/Test updates) We would like to welcome Amber Croisant to the CDOA Committee. Amber has been a CDOA since 2014, and we are so glad she’s joining us. A special thank you to Belinda Cathey, who served on the committee in 2024. We will miss Belinda and all of her hard work. Stephanie expressed a special thank you to Belinda for “keeping me on my toes”! REMINDERS: You have 90 days to log your CE credits Verify your email address in the CDOA system
Please email cdoa@nadoa.org if you are interested.
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Cob Webs
Educational webinars can be approved for 1 (one) CDOA certification point. NADOA webinars, Steptoe & Johnson
Opportunities include: creating webinar flyers, contacting speakers before a webinar event to obtain biographies and presentations, help modernize NADOA’s GoToWebinar site. Please email webinars@ nadoa.org if you are interested. The 2025 Webinar Co-Chairs, Gordon Gallet, Sara Buck, and Yoli Bazan would love to hear from you! Steptoe & Johnson PLLC – Visit: https://www.steptoe-johnson.com and click on News for details. The Steptoe webcasts are recorded. To access previously recorded webcasts, go to www.Steptoe- Johnson.com and enter Webcasts in the search feature. Oliva Gibbs LLP – Energy Education Series: Visit: www.oglawyers.com/ events for further information. NARO – Visit: https://www.naro-us.org/events/list for webinar schedule. If you are aware of other educational webinars, please advise the NADOA News Magazine of details to be added to the Calendar of Events ( magazine@nadoa.org ).
PLLC webcasts and Oliva Gibbs LLP webinars are pre-approved. Please check the certification page to determine if other webinars are pre-approved or need to be submitted for approval to the NADOA Certification Committee. Contact the CDOA committee to obtain pre-approvals at cdoa@nadoa. org . Certification points should only be applied for after completing the event. If you are unable to attend an event due to unforeseen circumstances, it is an ethics violation to apply for the credit. NADOA – Webinar information and registration links will be posted on the website ( www.nadoa.org ). Webinars are free for NADOA members and $15.00 for non-members. NADOA members may use the following link to log in and register for upcoming webinars, as well as listen to previously recorded webinars https://nadoa.wildapricot.org/ page-1709226 or by using the Webinar link in the Members Only section on the homepage. Please send suggestions for NADOA webinar topics/ speakers to webinars@nadoa.org . Details for upcoming NADOA Webinars can be found at: https://nadoa.org/news-events/ The webinar committee is looking for volunteers.
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2025 Nomination Form for NADOA Membership Recognition
DO YOU HAVE A MENTOR, TRAINER, SPEAKER OR COMPANY YOU FEEL DESERVES A PAT ON THE BACK FOR ALL THEY DO??? NOMINATE THEM FOR ONE OF THE AWARDS BELOW!! I would like to nominate ____________________________________________________ for the Ellis Rudy Memorial Lifetime Achievement Award . This award is presented to the NADOA member who has exemplified the Division Order profession through demonstrated leadership contributions to the industry and the profession during his/her career. I would like to nominate ____________________________________________________ for the NADOA Membership Recognition Corporate Award . Presented to the group or company that has contributed to NADOA’s growth and development, the Division Order profession, and/or the industry during the past year. I would like to nominate ____________________________________________________ for the Russell Schetroma Memorial Speaker’s Award . This award is presented to an individual who has contributed to NADOA’s growth and development by speaking, educating, and sharing knowledge on numerous occasions to the NADOA Membership, the Division Order profession, and/or the industry during the past year. Please detail the nominee’s involvement in NADOA, the services they have performed and/or contributions they have made ( y ou may attach a separate sheet if necessary).
Signature
Please Print Name
Email Address
Send nominations to: Member Recognition Awards Committee, c/o Lola Strickland (lstrickland@dgoc.com)
Nominations will be accepted through MAY 1, 2025
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Looking Ahead: Professional Headshots at Future Institutes? A professional headshot goes far beyond a simple photo. In today’s digital age, it’s an integral part of how you present yourself to potential employers, clients, and collaborators. It’s the first impression many people will have of you before they even engage in a conversation. Whether it’s on LinkedIn, a company website, or an event speaker lineup, a high-quality headshot signals professionalism and attention to detail. Taking professional headshots on your own can be costly and time-consuming, but what if you could say goodbye to selfies and blurry and outdated headshots right at the Institute? Take the survey today to help us gauge interest!
LOOKING FOR CANDIDATES FOR 2026 NADOA BOARD POSITIONS:
• 2nd Vice President • Recording Secretary • Corresponding Secretary
Contact Vicki Danielson by June 1, 2025. vdanielson@att.net For more details on positions, log into NADOA.org / Publications / Bylaws
https://www.surveymonkey.com/r/nadoaheadshotsurvey
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THIS IS AN ADVERTISEMENT
Name_______________________________ Email_______________________________ Phone_______________________________ Date________________________________
The Ellis Rudy Memorial Scholarship will be available this year for individuals looking for assistance to attend the 2025 Annual Institute in Boston, MA , at Westin Copley Place. This scholarship does not cover the full cost of Institute. It will cover registration. If you receive a scholarship, please be available to volunteer during I nstitute. To apply, please complete and submit the below form by May 1, 2025, or contact Vicki Danielson at vdanielson@att.net for further information. ELLIS RUDY MEMORIAL SCHOLARSHIP What is the nature of your financial need? o Unemployment o No Company Support o Other _____________________ How many years have you worked in Division Orders?
o 1-4 o 5-9 o 10-14 o 15+ What do you most want to get from Institute? o Education o Networking
o Leadership training through volunteering o Other ______________________________ Write a short paragraph on why you would be a good candidate for the scholarship: ___________________________________________________________________ ___________________________________________________________________ ___________________________________________________________________ ___________________________________________________________________
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NADOA
Institute
NADOA 52nd Annual Institute August 27th -29th 2025 Westin Copley Place, Boston, MA
REGISTRATION
Registration will need a few volunteers this year, although it is too early to know exactly how many we will need. As always, we are ready to hear from you if you want to help. We will know more after our first Institute Meeting in February, and everything will be nailed down soon after that. Please reach out to Debbie McKee or Amanda Lynch if you would like to help, and we will make sure to get you on our list. It is a great opportunity to meet the people you work with on the telephone all the time. You can reach Debbie McKee at 405-570-9702 or dmckee52@gmail.com or Amanda Lynch at 405- 802-0614 or alynch@gulfportenergy.com . Registration will open on Wednesday, August 27, 2025, and classes will be held August 28 & 29, 2025. Boston offers countless sites to explore! If you can extend your trip by a few days before or after Institute, it will definitely be worth your while.
August 27-29, 2025 Westin Copley Place, Boston, MA
GREETERS NEEDED! Volunteering is a great way to meet fellow NADOA members, while giving back to your organization. If you would like to volunteer, please contact Betty Davidson at clucorkie@yahoo.com (713-409-4865) or Brenda Pirozzolo at bpirozzolo21@gmail.com (214-924-9200). We look forward to meeting you in Historic Boston.
Amanda Lynch Co-Chair Debbie McKee Co-Chair Iris Alcantara Co-Chair
Melanie Westbrook Co-Chair Shemika Williams Co-Chair Stacy Parker Co-Chair
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Hello Boston …….
Welcome to the Westin Copley Place, located in the heart of Boston’s vibrant Back Bay Area . The hotel offers 803 guest rooms, multiple meeting spaces, and a variety of eating options, including Bar 10 Lounge & Restaurant, Fogo de Chão, in- room dining, and Starbucks. For your convenience, a gift shop is located in the lobby, and you can stay active at the 24-hour Westin Workout fitness center. The room rate for Institute is $239 per night, with each room offering exceptional views of the city. The Westin is directly connected by a walkway to a shopping mall with every store imaginable, along with several fantastic restaurants. A favorite spot is EATALY , where you’ll find a wide variety of vendors, including options for food, snacks, gelato, pizza, and much more. The hotel is ideally located to explore all that Boston has to offer. Right across the street is the historic Old South Church, alongside the Boston Public Library. Just a couple of blocks away, you’ll find Newbury Street, filled with unique shops and great restaurants. The Boston Observation Deck is also nearby, providing breathtaking views of the city. If you’re in the mood for a tour, you can cross the street to catch the Hop On/Hop Off bus to explore even more. As the saying goes, “In Boston, history is written on every corner.”
Start planning your trip to the NADOA 2025 Institute “CHEERS TO EDUCATION IN BOSTON! ” from August 27 – 29. You won’t want to miss out on all the exciting events we have in store!
Norma Dooley Gordon Gallet Kaprice Pearson
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NADOA 2025 ANNUAL EDUCATIONAL INSTITUTE The Westin Copley Place – Boston, MA August 27-29, 2025 Cheers to Education in Boston!
SPONSOR DONATION FORM
Donation Form Link
Thank you for your sponsorship. Your donations help with the cost of our speakers, hospitality functions, conference publications, including a compilation of our speakers’ presentations, as well as to cover general fund- administrative costs. We have attached suggested contribution levels. However, please keep in mind that these are suggestions – all contributions will be recognized. This financial support helps reduce the costs to all attendees and allows NADOA to present a professional, quality educational event . If you would like to apply your sponsorship to a specific category, you may indicate that preference below. If you would like to apply your sponsorship to a specific category, you may indicate that preference below. Thank you for your sponsorship. Your donations help cover the costs of our speakers, hospitality events, conference publications - including a compilation of speaker presentations - as well as general administrative expenses.
CATEGORY
AMOUNT
General Donation (includes administrative costs, door prizes, etc.) Education / Speaker Hospitality Functions Publications Golf Tournament
SPONSOR INFORMATION
Company Address
City, State, Zip Email Address Phone Number Contact Person
To assure that your name will be published in the NADOA Institute Brochure, please return your donation, along with this form , to NADOA no later than June 1, 2025. Corporate sponsorships received after this date will be published in subsequent publications. PLEASE RETURN THE FORM AND CONTRIBUTION TO: NADOA PO BOX 1656 Palm Harbor FL 34682 For questions , please contact: Vicki Danielson Melissa Fontana Corporate Donations Co-Chair Corporate Donations 713-417-7330 vdanielson@att.net MMFONTANA1104@att.net
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Any individual/Corporation making a $5,000 donation by June 1, 2025 will receive 1 (one) free registration for conference . Any individual/Corporation making a $10,000 donation by June 1, 2025 will receive 3 (three) free registrations for conference Donation Categories will receive 3 (three) free registrations for the conference. Any individual/Corporation making a $5,000 donation by June 1, 2025 will receive 1 (one) free registration for the conference.
$10,000+
Boston Tea Party – Going overboard for freedom of knowledge
$5,000-$9999
Fenway Park (Red Sox)- Outta the Park for education!
$3,500-$4999
Freedom Trail – Walking the trail for history and education
$2000-$3499
Bull & Finch Pub (Cheers!) Cheers! To Learning
$1000-$1999
Boston Marathon – Sprinting for Knowledge
$500-$999
Harvard/MIT- Knowledge is Power!
Up to $499
Paul Revere- The British Are Coming!
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INFORMATION We are working with The Boston Visitor Center MB MEET BOSTON to gather Brochures, Visitor Guides, Walking Maps, and Discounts to make available during NADOA’s Institute in August 2025. Plan to come and enjoy an educational experience like no other, coupled with Boston’s cultural attractions and world-famous museums. The history of Boston is America’s history, and our Institute will be World Class. Be sure to join us August 27-29 at the Westin Copley Place, Boston, MA, for the NADOA 2025 Institute. Digital Visitor’s Guide: https://meet-boston.dcatalog.com/v/Official_Visitors_Guide/?page=1 Further information on Boston Visitor Center: https://www.meetboston.com/plan/visitor-center/
Brenda Pirozzolo, CDOA Betty Davidson, CDOA
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Promote your Company and contribute to the Swag Bags in Boston!!
There is no better way to let others know about your Company than contributing note pads, sticky pads, pens, pencils, USB drives, desk accessories, water bottles, phone & electronic accessories, chargers, phone stands, business card holders, golf balls, tees, sports towels, umbrellas, stress balls, travel mugs, tote bags, lip balm, socks, cord organizers, candy, key chains, flashlights, hats, sling bags, luggage tags, lanyards, badge holders and chip clips are just a few ideas...or be creative and send something new! We are planning on 300 to be in attendance and will be providing additional information in the months ahead. If you have any questions or concerns, please contact us and we will help in any way we can!
Sonya Turner: sturner@farmersnational.com Lola Strickland: lstrickland@dgoc.com
Thank you in advance for your time and consideration in making our 2025 Cheers to Education in Boston a success!! Sonya and Lola Co-Chairs, Swag Bags
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Legal
Updates Articles are not intended to be and should not be relied upon as legal advice or to establish any kind of an attorney-client relationship with the author. No Standing, No Sale: What Cardinal Minerals, LLC v. Miller Means for Ohio Mineral Transactions By Ally McCluskey and Josh Peterson, Oliva Gibbs LLP
Ohio
process provided under the DMA. Beginning in August of 2013, the title company published notice of abandonment on behalf of the Millers in the Monroe County Beacon, filed an affidavit of abandonment in the Monroe County Official Records. Notable, notice was only served by publication, rather than on the Pfalzgraf Heirs at their last known addresses, even though they were identified in the Miller’s title search. Cardinal Minerals, LLC appealed the 7 th District’s decisions to the Ohio Supreme Court. The Ohio Supreme Court, however, denied to hear appeals on both cases. * Oliva Gibbs Law Clerk Kaitlyn Richards contributed to this article. 1 Ohio Rev. Code § 5301.56. 2 2024-Ohio-2133 (7th Dist. 2024), jurisdiction declined, 2024- Ohio-5104; and 2024-Ohio-3121, (7th Dist. 2024). 3 2024-Ohio-2133, ¶ 5 (7th Dist. 2024), jurisdiction declined, 2024- Ohio-5104. 4 Id. at ¶ 8.
Who has standing to challenge abandonment of a mineral interest under the Ohio Dormant Mineral Act (“DMA”)? Earlier this year in two cases, both styled Cardinal Minerals, LLC v. Miller , the 7 th District Court of Appeals of Ohio held that only the record holder of the mineral interest at the time the DMA process is completed, and not a subsequent purchaser of the interest, has standing to challenge the abandonment process. The court’s holding implies two key points: 1. A purchaser who acquires a mineral interest subject to completed DMA filing acquires nothing, because under Ohio Rev. Code § 5301.56(H)(2)(c), that interest was deemed abandoned and vested with the surface estate upon completion of the DMA process; and 2. The only way to revive a statutorily abandoned mineral interest under the DMA is for a holder with proper standing to obtain a judicial determination that the abandonment process was invalid.
The Authors:
I. Background and Facts
Ally McCluskey
The Cardinal cases involved a 36-acre tract of land, and an 80.32-acre tract of land located in Monroe County, Ohio. Through a series of conveyances, S.E. Pfalzgraf and his wife, Emma Pfalzgraf reserved all of the oil and gas in and under both properties (the “Pfalzgraf Interest”). The Millers (Appellees) acquired the surface of the property in the late 1990s and attempted to enter into an oil and gas lease with Eclipse Resources I, LP (“Eclipse”) in 2012. When the Millers received a defect notice indicating that they did not own the oil and gas leasing rights, they hired a title company to perform research on the Pfalzgraf Interest and initiate the abandonment
Phone : 614.812.0814 Email : amccluskey@oglawyers.com
Ally is a versatile attorney who helps clients navigate complex legal issues in corporate and property law in the upstream energy sector. She has extensive experience with title curative, mineral title due diligence, drilling, and division order title opinions across Appalachia and Texas. She also represents clients in quiet title actions and oil, gas, and mineral rights transactions. Colleagues have praised Ally as a collaborative team member. Her deep industry knowledge, resourcefulness, and commitment to achieving favorable business out-
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tions for his clients. Prior to joining Oliva Gibbs, Josh served as the Head of Trust Real Assets & Mineral Re- sources at a major bank, giving him a unique perspective that allows him to approach complex issues with creativ- ity and innovation. Clients appreciate Josh’s commitment to providing ex- ceptional service and trust him for a range of matters, in- cluding due diligence, operational issues, and title opin- ions. Josh has built a reputation for being practical and car- ing. He is passionate about his work and also dedicated to his family, which includes a sweet (yet sometimes defi- ant) toddler. Fun family fact about Josh – he has an iden- tical twin brother who is also an attorney! In his free time, Josh enjoys reading, playing racquet- ball, and exploring new activities like the reinvigorated craze of pickleball. EDUCATION J.D. Texas Southern University, Thurgood Marshall School of Law B.B.A., Business Administration, Texas State University BAR ADMISSIONS Texas PRACTICE AREAS Oil and Gas Title Opinions Oil and Gas Contracts Oil and Gas Transactions Contract Review
comes have earned her a reputation for providing excep- tional client service. In addition to her legal practice, Ally frequently con- tributes thought leadership to the energy law field through articles and presentations at prominent industry events. 2024 Pennsylvania Super Lawyers Rising Star, Energy & Natural Resources list by Super Lawyers, a division of Thomson Reuters. EDUCATION J.D., Duquesne University School of Law B.S., University of Pittsburgh BAR ADMISSIONS Pennsylvania PRACTICE AREAS Acquisitions and Due Diligence Conveyancing and Curative Oil and Gas Litigation Oil, Gas and Mineral Transactions
Surface Use Title Matters
Josh Peterson
Phone : 713.229.0360 Email : jpeterson@oglawyers.com
Josh has over a decade of experience in the oil and gas industry and draws on both his legal and corporate background to provide practical and cost-effective solu-
“After Acquired Title” to Remain a Caged-Bird after Dellit v. Schleder, 2022 MT 196, 518 P.3d 830 By Lance Walker, Oliva Gibbs LLP
deed and thereby greatly simplify land titles for all Montanans. Dellit is a case of two competing statutes. Where one statute is given almost infallible reverence—while the other is kicked to the curb like yesterday’s trash. The first one for whom we speak is Section 70-1-516, MCA stating that the general rule of deed interpretation is that “[a] grant is to be interpreted in favor of the grantee, except that a reservation . . . is to be interpreted in favor
“No one has a vested interest in any rule of common law.” Meech v. Hillhaven W. , 776 P.2d 488, 494 (Mont. 1989). Luckily the Montana legislature has codified the common law rule of after-acquired title as a remedy for a grantor’s breach of warranty in a deed for failure to deliver a complete title. [1] However, this rule continues to remain a caged-bird after the Montana Supreme Court’s ruling in Dellit v. Schleder, 2022 MT 196, 518 P.3d 830. Consequently, the court missed an incredible opportunity to bring clarity to the enforcement of title covenants in a
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of the grantor ” (emphasis added). Indeed, the Montana Supreme Court has even gone so far as to declare “[t]he court must liberally construe express reservations in grants of real property in favor of the grantor.” Ash v. Merlette , 2017 MT 305, 407 P.3d 304, 310 (emphasis added). However, it must be emphasized that this statute does not expressly preempt, repeal, or abrogate other statutory rights and remedies. The second statute passes after-acquired title by operation of law as a remedy for a breach of title warranty in a grant deed. Section 70-20-302, MCA. The after-acquired title statute (based on estoppel by deed) applies where the grantor’s title at the time of the conveyance is defective or lacking, and the grantor later obtains title or a portion thereof. Rowell v. Rowell , 174 P2d 223, 226 (Mont. 1946). The doctrine of after-acquired title helps to give certainty to the enforcement of title covenants and greatly simplifies title examinations—since a title examiner who encounters this situation can simply assume that a grantee got the after-acquired title without being concerned with whether any judicial action was taken to obtain it ( i . e ., title passes automatically by operation of law). Intertwined with after-acquired title are other legal concepts, which taken together, form the framework for the legal principle that a title warranty is a distinct and separate contract from the conveyance itself. Therefore, a determination that a reservation is to be interpreted in favor of the grantor should not operate to limit the scope and enforcement of a separate contractual warranty where such title warranties are required by law to be construed against the grantor. However, the court’s ruling in Dellit relied upon a legal fiction to literally turn a general warranty deed into a quitclaim deed—all for sake of maintaining an inexplicable allegiance to one statute.
Thereafter, by a Warranty Deed dated March 10, 1950 (herein: “ Warranty Deed ” or “ Deed ”) Leonard conveyed to his sister Irene all the Property subject to the following reservation:
Excepting and reserving unto the party of the first part, himself, his heirs, and assigns, an undivided two thirds [2/3] of all oil, gas and minerals in, upon or under said lands. . . . (brackets added)
Dellit, 518 P.3d 830 at 833. [2] The Deed also included a warranty clause. Id .
Through a series of conveyances Dellit later became successor to Irene. Leonard sought a decree stating that he reserved all his mineral interest in the Property under the Warranty Deed. Dellit defended, contending that the Warranty Deed transferred to Irene an undivided 1/3 mineral interest in the Property ( i . e ., all the minerals less 2/3 = 1/3 of the minerals conveyed). The equities in the case are as follows: (1) Leonard and Irene derived their interest in the Property from their parents ( i.e ., they were co- tenants.); (2) through a series of conveyances Dellit (a family member) succeeded to Irene’s interest; (3) the parties agreed the Warranty Deed is unambiguous ( i . e ., it grants the Property and then reserves a 2/3 mineral interest); and, (4) at the time of the Warranty Deed Irene knew what Leonard owned because she owned the other outstanding interest not encompassed by Warranty Deed. The court found in favor of Leonard because Irene, as a co-owner with Leonard in the surface and minerals in the Property, was not misled by the Warranty Deed’s reservation clause ( i . e ., equitable estoppel). Dellit , 518 P.3d 830 at 839.
Facts of the Case
Discussion:
Now, before going any further let us be very clear—there are to two completely different and distinct affirmative defenses at play in this case: Estoppel by Deed (the focus of this article) and Equitable Estoppel (which was ultimately used to decide the case based on the “equities” cited in the
For purposes of this discussion, the abbreviated facts in Dellit are as follows: Leonard (2/3) and his sister Irene (1/3) were the record owners of a certain tract of land inherited from their parents (the “ Property ”).
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Facts above).
Leonard breached his warranty to deliver 1/3 of the minerals. In such a case, what then is the remedy for Leonard’s breach of warranty? Irene certainly had a cause of action against Leonard for money damages ( i . e ., remedy at law)—however, this is not very satisfying. Irene also had the remedy of after-acquired title available ( i . e ., equitable remedy)—but only if Leonard should ever acquire an outstanding 1/3 mineral intertest. Most notably, however, this remedy does not provide an immediate solution. Even to the casual observer it would seem absurd to make Irene wait for Leonard to later acquire, if ever, an outstanding mineral interest, when in fact Leonard holds by virtue of his reservation the very interest, 1/3 of the minerals, required to remedy the breach. As such, Leonard should be estopped to assert any title to the reserved minerals until his grantee is made whole. In this regard a logical application of the after- acquired statute would dictate that Leonard’s reservation of a 2/3 mineral interest has the legal effect of warranting the remaining 1/3 interest to Irene thus leaving Leonard with a 1/3 mineral interest. [3] The question then becomes: Is there room under Montana law for such a logical extension of Section 70-20-302, MCA (after-acquired title to pass by operation of law)? Unfortunately, the court declined to answer this very question—even though Dellit practically begged the court to do so. Nonetheless, such an extension is indeed a logical and just application of after-acquired title when examined under the rubric that statutes are to “be liberally construed with a view to effect their objects and to promote justice.” Section 1-2-103, MCA. As previously stated, the rule of after-acquired title is a remedy for a grantor’s breach of warranty in a deed for failure to deliver a complete title. It is also commonly recognized that a warranty is not an essential component of a proper transfer of ownership, and it neither enhances nor restricts the conveyed title ( i . e ., you do not need a warranty to transfer title under a quitclaim
Estoppel by Deed: “Estoppel by deed enforces the plain language of a deed, preventing the other party from denying the meaning and effect of that language.” Id. at 838. In other words, courts should first attempt to glean the intent of the parties from the “four corners” of the deed without looking at outside facts and circumstances surrounding the execution of the deed ( i . e ., extrinsic evidence). The four-corners test is codified under Section 70-20- 202, MCA (explaining extrinsic evidence is not to be considered in construction of a deed). Equitable Estoppel: Thereafter, a court may decline to enforce certain provisions of a deed if the equities between the parties ( i .e., equitable estoppel analysis) are so required due to specific facts and circumstances surrounding the deed. Equitable estoppel is codified under Section 1-04-102, MCA (consideration of circumstances surrounding execution of a deed permitted if needed to determine parties’ intent). Now, let us consider the scenario in Dellit , but this time under a true Estoppel by Deed analysis, where Leonard owns 2/3 of the surface and minerals in the Property; and thereafter, gives a Warranty Deed in favor of Irene purporting to “grant and convey” the Property but reserving to himself 2/3 of the minerals. Under a four-corners test ( i . e ., estoppel by deed, Section 70-20-202, MCA) and the application of Section 70-1-516, MCA (reservations are interpreted in favor of the grantor) it is determined that Leonard fairly and truly intended and thereby did reserve to himself all his 2/3 mineral interest. Okay fair enough, Leonard reserved his 2/3 mineral interest. But what then did Leonard purport to convey and thereby warrant? Again, applying a four-corners test to the grant/warranty ( i . e ., estoppel by deed)— which the Dellit court did not do in its case —it can be fairly deduced that the purported grant (in combination with the 2/3 mineral reservation) is to convey the surface and 1/3 of the minerals to Irene. However, because Leonard cannot convey what he does not own— Irene only received title to the surface and no minerals. As a result, according to our analysis,
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deed). Instead, a warranty stands as a distinct and separate agreement, wherein the grantor commits to compensating the grantee for any title defects. Wagner v. Cutler , 757 P.2d 779 (Mont. 1988) (addressing the scope of a covenant of warranty contained in a special warranty deed under contract rules of interpretation). More importantly, the Montana Supreme Court has already declared that under Section 28-3-206, MCA “[a]ny uncertainty over ‘what was warranted’ in the deed should be interpreted most strongly against the party who drafted it.” Wagner, 757 P.2d at 782. Very clearly then, the law requires a reservation in a deed to be interpreted in favor of the grantor under Section 70-1-516, MCA; while at the same time, the law also demands title warranties be construed against the grantor under Section 28-3-206, MCA. In this context, it is argued that the after- acquired title rule serves to prevent the assertion of title in conflict with a warranty breach— regardless of when or how that title is acquired . Put differently, if enforcing the warranty proves to be a fair and effective recourse for cases involving after-acquired title, it is similarly fair, effective, and suitable in this scenario—where, by virtue of the reservation, title is “acquired” the moment the Deed is executed. See, End Note [3], s ee also, Rowell, 174 P.2d 223 at 227 (Citing a Pennsylvania case for the proposition that when grantors convey land which they do not own, and afterwards obtain the title thereto, they “will not be permitted to set up this after-acquired title to defeat [their] previous grant … for this would be to permit [them] to perpetrate a fraud on [their] grantee.”). So of course, there is room under Montana law to support such an expanded scope of the after-acquired title rule. In fact, Montana law may demand it under Wagner v. Cutler , 757 P.2d 779 (Mont. 1988) (title warranties to be construed against the grantor). Nevertheless, the next question then becomes: Is there room under Montana law to harmonize such an extended interpretation of the after- acquired title statute without being repugnant to the other statute—interpreting reservations in favor of the grantor? Indeed, when it comes to harmonizing
two statutes, Montana law is clear:
“When ascertaining the Legislature’s intent, we presume the Legislature does not pass meaningless legislation, and we harmonize statutes relating to the same subject to give as much effect as possible to each.”
Miske v. Mont. Dep’t of Nat. Res. & Conservation, 2023 MT 241, ¶ 25.
To be clear, the difference between a warranty deed and a quitclaim deed is monumental because the former passes after-acquired title as a matter of law and the latter does not. The distinction between the two is very simple. A warranty deed purports to grant the property itself. Whereas a quitclaim deed merely conveys only the grantor’s right, title and interest—if any—in the property. “A fee simple title is presumed to be intended to pass by a grant of real property, unless it appears from the grant that a lesser estate was intended.” Section 70-20-301, MCA . A deed conveying the “following described premises” (or similar language), expresses an intention to grant the fee, or the entire estate, in whatever is described. Henningsen , 221 P.2d 438 at 443. As such, the Warranty Deed in question here is more than a quitclaim deed. It conveyed the Property itself (less Leonard’s reserved 2/3 mineral interest) and is therefore sufficient to pass after-acquired title. However, the court in Dellit (seemingly fixated on the reservation to the exclusion of the separate warranty contract) rejected this construction because:
. . . it favors the Grantees by placing an implied grant above an explicit reservation. This interpretation devalues the reservation of ‘an undivided two-thirds of all’ mineral rights by holding the explicit fractional interest retains only as much meaning as remains after the implicit 1/3rd grant is satisfied.
Dellit , 518 P.3d at 835.
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The Dellit court’s analysis would be spot-on if it were a quitclaim deed rather than a GENERAL WARRANTY DEED! In the Dellit case (after giving effect to Leonard’s reserved 2/3 mineral interest)— Leonard is in no way simply purporting to convey only his remaining right, title and interest, if any, in the Property (this is what a quitclaim deed would accomplish). Here, it is apparent that the Deed conveyed the land itself and not just Leonard’s interest in the Property, and therefore passes after- acquired title. Consequently, the analysis as used in Dellit is a wholly misplaced legal fiction. A court cannot unilaterally change a warranty deed into a quitclaim deed—no matter how badly it wishes to give exclusive effect to the reservation. Montana law disfavors such an interpretation. Henningsen , 221 P.2d 438 at 443.
2008 MT 223, 186 P.3d 1288 (a court must reconcile two statutory schemes where it is possible to do so).
Conclusion
It is submitted that an equitable estoppel analysis (while needed in this case) is no basis for the court’s expressed rejection of the after- acquired title rule. The court could have very easily recognized a breach of the separate warranty contract and then, after weighing the equities, chose not to enforce the after-acquired title rule under a separate equitable estoppel analysis. The court could have reached the same result—while also defining the scope of after-acquired title as relates to reservations —thereby bringing more certainty to the enforcement of title covenants. In conclusion, the Dellit case highlights the complexities inherent in Montana’s property laws and the challenges of reconciling competing statutory frameworks. This is particularly true when the court employes the use of a legal fiction (treating a warranty deed as a quitclaim deed) to completely rewrite the Deed so as to shoehorn it into some narrowly constrained statute. However, by adopting a pragmatic and balanced approach to statutory interpretation, future courts can clarify the enforceability of title covenants and simplify the process of land title examinations. It is time to untangle the knots and provide a clear path forward for after-acquired title in Montana. In short, it may be high time to open the cage and give after-acquired title some room to fly!
The two statutes are, however, easily harmonized so that both may co-exist. For example, a court could easily find:
(1) that without question Leonard by the four-corners of the Deed did in fact reserve his 2/3 mineral interest: thus, staying faithful to Section 70- 1-516, MCA—regarding reservations in favor of the grantor; (2) that the separate warranty contract does not diminish or impair the title so reserved— i . e ., the reservation is effective: again, staying faithful to Section 70-1-516, MCA; and finally, (3) that the breach of the warranty contract only operates as an estoppel denying Leonard the right to claim the full 2/3 mineral interest he had reserved for himself, and instead allowing Irean to receive 1/3 out of that interest as a remedy for Leonard’s breach of the Deed’s warranty: thereby, also staying faithful to Section 70-20-302 MCA—as to after-acquired title. This construction is a very simple and logical extension of the after-acquired title rule—while also avoiding an implicit repeal of Section 70-1-516, MCA (reservations favor of the grantor). Such an analysis provides a framework for allowing a court to remain faithful to its duty to harmonize two statutory schemes where it is clearly possible to do so. See e . g ., Alkire v. Mun. Court, City of Missoula ,
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[1] The full text of Section 70-20-302, MCA: After-acquired title to pass by operation of law. “When a person purports by proper instrument to grant real property in fee simple and subsequently acquires any title or claim of title to the real property, the real property passes by operation of law to the grantee or the grantee’s successors.” [2] Furthermore, the Deed contained a “Subject to” clause, stating that: (t)his conveyance is also subject to all easements and reservations in the chain of title.” Dellit , 518 P.3d 830 at 833. The fact that the Warranty Deed contained language stating that it was “subject to” prior reservations of record does not render inoperative the presumption that Leonard intended to convey all of the Property, less the express
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