Who owns the mineral rights? The Ohio Supreme Court may decide

CALDWELL, Ohio — A fight over who owns the mineral rights under 42 acres of land in Noble County may be headed to the Ohio Supreme Court.

Jon Walker Jr. filed a lawsuit against John R. Noon in 2012 in an attempt to get the mineral rights to the property. Walker owns the surface rights.

Background

According to court records, Noon purchased the property in 1964 and severed the mineral rights from the surface rights when he sold the property in 1965. In 1970, the property changed hands two more times.

Then, in 2009, Walker purchased the property. In December 2011, Walker sent a notice of abandonment of mineral interest to Noon.
But in January 2012, Noon filed an affidavit and laid claim to preserve his mineral interest.

In April 2012, Walked filed a complaint for judgment. He requested the trial court rule that he is the lawful owner of the mineral rights.
Walker claimed in the court records that the mineral rights merged with the surface rights in 1992 by the way of the 1989 Ohio Dormant

Mineral Act

He claimed Noon abandoned his interest in the mineral rights when he failed to stop them from expiring.

Meanwhile, Noon filed a mineral preservation notice with the court in the spring of 2012.

The Noble County Court found that Walker did own the rights and denied Noon’s motion to keep his mineral rights.

Court of Appeals

Noon then filed an appeal with the Seventh District Court of Appeals in April 2013. Noon died after filing the appeal. His daughter, Patricia Shondrick-Nau, was substituted in the case since she is the executor of Noon’s estate.

The issues in the case revolve around the 1989 version of the Ohio Dormant Minerals Act and the 2006 version of the same law. This is the first case to go to court over how the acts intersect and what it means to the surface owner and the mineral rights owner.

The Seventh District Court of Appeals ruled April 3 that Walker does own the mineral rights since Noon reportedly didn’t develop them since 1964.

Ohio Dormant Minerals Act

The Ohio’s Dormant Minerals Act, which is part of the Ohio state law, provides a surface owner with the opportunity to gain title to previously severed mineral rights if those rights have not been “used” during a specific 20-year time period.

The 2006 version of the Ohio Dormant Minerals Act specifically applies to any mineral interest, defined as a “fee interest in at least one mineral regardless of how the interest is created and of the form of the interest, which may be absolute or fractional or divided or undivided.”

The 1989 version of the statute did not define the interests subject to abandonment.

The 1989 version of the Dormant Minerals Act has been described as a “use it or lose it” statute: if the mineral-interest owners did not “use” their mineral interests during a 20-year time period, they automatically vested in the surface owner.

The 2006 version of the Dormant Minerals Act says the surface owner must adhere to a multi-step process to accomplish the merging of the surface and mineral interests. The surface owner must confirm that the oil and gas mineral interests have not been used within the previous 20 years.

Then the surface owner must “serve notice by certified mail, return receipt requested, to each holder or each holder’s successors or assignees, at the last known address of each, of the owner’s intent to declare the mineral interest abandoned.”

If certified mail notice is not possible, the surface owner must publish notice at least once in a newspaper of general circulation in each county in which the land is located.

The surface owner must also confirm that one of the mineral interest holders has not recorded documents within 60 days of service or publication of the notice laying claim to the mineral rights.

Then the surface rights owner must file an affidavit of abandonment in the county recorder’s office between 30 and 60 days after the published notice date.

Ohio Supreme Court

Patricia Shondrick-Nau has appealed the Seventh District Court of Appeals decision to the Ohio Supreme Court, according to her attorney, Matthew Warnock, of Bricker & Eckler, Columbus.

Warnock said it is unknown if the Ohio Supreme Court will hear the case.

Walker’s attorney has 30 days from May 16 to file a memorandum in response to the filing. If Walker files a response, the Ohio Supreme

Court will then take two to four months to decide if it will consider the appeal.

However, Chesapeake Exploration has filed a friend of the court brief, asking for the Supreme Court to look into the case because it will impact so many landowners.

In addition, the federal court in Columbus has asked the Ohio Supreme Court to examine the issues in the case because justices are waiting to make a decision in a separate, unrelated federal case, based on the Ohio court’s decision.

The case is gaining interest because the decision could impact so many landowners since the Seventh District Court of Appeals covers Belmont, Carroll, Columbiana, Harrison, Jefferson, Mahoning, Monroe and Noble counties, which are all involved in shale exploration.

Decision stands

If the Ohio Supreme Court declines to hear the case, then the mineral rights will be remanded to Walker as was ruled in the Seventh District Court of Appeals.

About the Author

Kristy Foster Seachrist lives in Columbiana County raising sheep and horses. She earned her degree from Youngstown State University and has worked in both print and broadcast journalism. You can follow her on Twitter at http://twitter.com/fosterk96. More Stories by Kristy Foster Seachrist

29 Comments

  1. Ironfarmer says:

    Land owners pay the taxes for ever and ever and these Johnny come lately’s come around, NUT’S with them I feel it’s just and fair land owners get the rights they usually live on the land and pay the Taxes on it, Justice should not let others rule over them or run all over them period!

    • Loretta Koch says:

      My family has owned mineral rights since 1961, we are hardly ‘Johnny come latleys’

      • Ironfarmer says:

        Yah what U pay a buck an acre and then never payed any land taxes this stupid kinda of stuff should have never been allowed to happen a law should be past at least in Ohio that if U own the land and are paying the taxes all the rights go with it too no matter what and U don’t want to loose the rights don’t sell the land Period!

      • Auggie says:

        And just how much money have you made on them and how much real-estate taxes have you paid? If any, I willing to bet it is a fraction of what the surface owner has paid.

    • cynthia says:

      Our family does not own the land anymore but we do own the mineral rights and we have always paid taxes on that,the land owner should have made sure upon buying his porperty that he owned land and the mineral rights,no we have always paid our share

      • landowner says:

        You haven’t kept up the land and what taxes – you just want to get rich quick. The land owner should have all rights including what is beneath his surface. you didn’t want the land so why should you reap the benefits. The owner wants the land and is taking care of the land, we farm it, grow crops, and feed animals that feed you – so why should we give up our benefits because you think you own something underneath all of this. This law needs to go to the land owners. I am tired of people coming saying my great grand pappy owned this and I want something now.

    • John Walker has worked tirelessly in an effort to reclaim what belongs to him. Not only has it cost him time spent away from his business and family, but legal fees that continue to pile on each time there is an appeal filed by those holding the mineral rights.
      We have land in the same vicinity as Mr. Walker, so we have a vested interest in the case. We have owned our home for 19 years this December. We have been married almost 38 years, but weren’t able to afford a home untl we had been married almost 20 years. We married young, and had children right away. Like many in similar circumstances, we rented a house for those 20 years, ironically, from a coal company that had purchased land to strip for coal. Coal, back in the day, was the hot commodity.
      We fixed up an old farmhouse that didn’t belong to us and made it a “home” for our children. But when the opportunity presented itself to purchase an A Frame cabin on an acre of land, with thirty-one acres of land ajoining, we were elated. We were finally going to fulfill our dream of becoming homeowners.
      We knew the mineral rights had been purchased years before along with most of the property in our area. We were disappointed, but at that time weren’t aware of any loopholes that would allow us to reclaim what was lying beneath the land for which we had just signed away 30 years of our life.
      Just a quick FYI, the house was in bankruptcy court, so it was not a matter of loving the house, getting a loan for the house, closing and moving in. It was a stressful cat and mouse year and a half a bidding war with another buyer for a “may the best man win” so the court could get some of their money back. We ended up paying ten grand more for the house we live in than it was initially priced at to start at Sheriff’s auction. WE had to pay ALL the back taxes, and there were A LOT. WE paid all court costs and had lots of red tape to free up the house of our dreams.
      Why am I blathering on about this? Because it all ties in and matters. We have paid our dues and done the time. We just want what we already sit on everyday and pay taxes on.
      According to the 1989 Ohio Dormant Mineral Act my husband and I have every reason in the world to have hope that what John Walker has been fighting for can come to fruition.
      And yes, we want to get in on the gas and oil gravy train. Who wouldn’t? Do I want to pay off my house and replace my eleven year old Honda? Sure. Would I like to help my three grown children and their children when they need it, should there be something substantial? You bet.
      My husband and I will work until we can’t work anymore. But, we both have chronic health conditions, and if you have your mortgage paid, what a burden that takes from a budget.
      So best of luck John Walker. You know we are in your corner. I hope we are celebrating soon around a bonfire.

      • Hi!
        Just a reminder that the Ohio Supreme Court hears the case June 23. Be sure to check back here to see what happens in that hearing. There won’t be a decision for awhile but we’ll at least fill you in on the arguments presented to the court by lawyers.

      • Auggie says:

        Funny how a house/farm can go into foreclosure but the mineral owner is not affected in the least. When the surface goes into foreclosure and the taxes are not paid, why aren’t the mineral owners required to pay at least a portion of the taxes to maintain their mineral rights. In fact, it is to their benefit not to have anyone own the surface, Now they don’t have to pay the 1/8 royalty to the land owner. What a rip off, not only to the land owners but to the county who is getting nothing in real-estate taxes for what is under the ground. Hopefully the Ohio Supreme court will see how unjust the current laws are and fix them with a right decision.

  2. Ironfarmer says:

    I also feel this 2006 version of the abandonment law was just made up so all these Lawyers could get a big peice of the pie and it’s just messing things up!

  3. bill franklin says:

    Why not make it like coal mining, which seemed to strike a balance between the surface owner and the severed coal owner ?
    The current surface owner would get 1/3rd of the royalties (but no right to lease or to deny or to object to a lease by the oil and gas owner)
    The surface owner would also get 100% of the damages to the surface / crops / timber
    and the oil and gas owner has 100% right to lease and would get 2/3rds of the royalties.
    as for the lease bonus payment, who knows?
    It used to be only a couple of Dollars per acre
    At least for now, it is much much more
    If a landowner wants to retire and sell his farm to someone else (a non-family member, or “stranger”), and keep the oil and gas for himself and his heirs, why should the retiring farmer be forced to deed the oil and gas and all future revenue to the stranger?
    On the other hand, why should the current surface owner get absolutely nothing ?

  4. Auggie says:

    Why does anyone think it is fair that the surface owner should not own the mineral rights. Most of these rights were sold off many years ago for virtually nothing and made the, in most cases, unscrupulous leaser rich. Most of these lease are now held by paying the land owner virtually nothing every month or supplying a small amount of natural gas. They than turn around and sell these leases to big oil companies and receive large signing bonuses. These bonuses should go to the owner of the land not the mineral owner or at least shared by both. The taxes on the land are paid by the surface owners but the benefits all seem to favor the mineral owner. As far as people who want to retain the mineral rights but sell the property, than it should be deeded that way and the taxes should be paid by both them and the surface owner.

  5. Auggie says:

    Exactly, these leases should not be able to be sold off by the mineral owners. They should revert back to the surface owners when these wells are played out. What happened to the law that only allowed these oil guys to tie up 20 acres for a producing well. We have 3 wells 2 producing virtually nothing and one producing nothing. But the mineral holder is able to tie up 130 acres and than sell it off to big oil for a fortune.

  6. Frank says:

    So… Let me get this straight: “Party A” sold his mineral rights to “Party B” 100 years ago. NOW Party A wants his stuff back… Huh?? Are you kidding me? You call that justice? How do you know that “Party A” wasn’t ripping off “Party B” in the deal? How in the world do you have any justice if you come back years later and just rip-off someone’s duly-purchased stuff? I hope the Supremes take this case and settle honest property rights once and for all. And don’t try to play the “poor” card. We are just poor folks ourselves, and we never abandoned our rights, just because we didn’t drill soon enough for your tastes.

    • landowner says:

      Yes, the person that owned the land many many years ago and left it abandoned is now wanting his rights in minerals. We filed the correct paper work with the courts for abandonment and he wants his money for mineral rights – its not right. Everyone is poor in this area, if you didn’t want the land why would that give you any right to have anything else. the land was foreclosed on, and they didn’t want anything to do with this – we paid the back taxes and cleared the title on the land with the bank, why would they have any rights to minerals, they were not there 20 years ago and now that they are they want them. Not right!

  7. landowner says:

    I agree with the land owner – we own the land and pay the taxes on it and keep up the land, we are getting ready to go to court on the same scenario and these people came out of the woodwork and say they own the minerals when we filed for them through the abandon act. If you own the land you should own the mineral rights. We bought the land on a foreclosure plus paid back taxes – and now these people think they own the rights. What is fair about this???

    • Auggie says:

      Why didn’t the mineral interest owner step up to pay the taxes. They just want to collect the royalty money and let the surface owner pay the taxes or new owners pay the back taxes. I bet they won’t be sending the new owners (surface) their 1/8, with out a court battle.

  8. landowner says:

    so totally agree with Auggie. Why should mineral rights owners have the right to sign with a company saying they can come on your land and drill or survey the land while you have crops or farm animals and/or hunting. What gives them that right?

  9. Bobby says:

    If the person buying the land when the mineral reservation took place wasn’t worried about the minerals, why the concern now? Buying land is a simple deal. If you are worried about drilling operations taking place on the surface, don’t buy the land if the minerals don’t come with it. If the current seller is the mineral owner and won’t convey the minerals, have a no surface operations provision placed in the deed and you won’t have to worry about your lands being drilled on. You can also walk away from the deal and find another tract of land where the seller is willing to convey either a portion or all of the minerals.

    With that being said, I support the Dormant Mineral Act. It’ll allow the mineral owners that know they own the minerals to file a document within the 20 year time frame to secure their interests. Meanwhile, all of the mineral reservations in the late 1800’s and early 1900’s, where the heirs aren’t aware that they own these minerals, will revert back to the current surface owner.

  10. we have own are property for 27 years 100 years ago the land owner reserved minerals rights and timber rights .recently a guy pulls in my driveway and tells me he owns my timber. see you court.

  11. landowner says:

    I agree – what is right about this – someone comes lurking out of the blue – geez my father owned a house many years ago – maybe I should go claim those mineral rights. its not right what people are doing to the land owners.

  12. landowner says:

    You don’t own the land – you shouldn’t have the rights to the underground – you haven’t paid a dime on the taxes of that land – why should you benefit because you great great grand pappy owned it – they sold it and wanted it gone. The Ohio Supreme Court needs to see the landowners side – not the people lurking to get rich quick.

    • pat says:

      The bad news is, that those guys that want to get rich quick are more often than not already rich and lobbying in the supreme court to blow the guy that wont let that law be passed. The other side of the problem is that if you want to by land around here (NE OH) you cant find any decent size of land that acutally has mineral rights nor will those who “own” the mineral rights be willing to sell them, but then again why would they? If they can make a quick million without paying for a thing as far as taxes go then why not?

      • I agree with the statement regarding many of those having purchased large parcels of land years ago already “walking on high cotton”. And if the original purchaser is no longer alive, I know at least in our area, the heirs of these “land barons” are not hurting for money. I realize everyone should get what is coming to them, but the tax issue is really a thorn in my side. If you think you OWN my minerals than you sure as heck better cough up part of the money in February and July when Real estate taxes come due. You can’t just hire high profile law firms and file appeals to ride the gravy train unless you compensate ME for paying your percentage of taxes on those mineral rights you are hanging onto for dear life. How can you sort that all out and still call it fair? How?

  13. Jan says:

    At least Ohio HAS a Domant Minerals Act. Most states, like Arkansas, do not. We purchased property on which an owner in 1961 severed and retained half of the mineral rights when he sold the property. The property has changed hands 6 or 8 times since then. We found a record on Ancestry.com that the previous owner (of 1/2 of the mineral rights) was deceased. We recently tried to locate currenty 1/2 mineral owners (the heirs of this person) and found there is no way to do it because taxes are not collected on mineral rights, There was an oil and gas lease on the property for several years in the 70s, of which nothing ever transpired, and nothing since. It probably wouldn’t make any difference except that we were recently turned down for a refinance on our mortgage because we only owned half of the mineral rights. We figured we could purchase the other half of our mineral rights from the current owner, but there is no way to even find out who that is. So yes, Arkansas needs a law like Ohio.

    Would like to know how the lawsuit in Ohio turned out? Does anyone know?

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