Chesapeake Exploration, L.L.C. v. Buell

Transcription

1 Chesapeake Exploration, L.L.C. v. Buell 144 OHIO ST. 3D 490, 2015-OHIO-4551, 45 N.E.3D 185 DECIDED NOVEMBER 5, 2015 I. INTRODUCTION When mineral rights are severed from the surface of a parcel, they are often subject to numerous transfers, leases, and assignments, which, over time, can create confusion as to who owns them. 1 The Ohio Dormant Minerals Act ( ODMA ) was enacted in part to remedy this problem. 2 The ODMA generally causes severed mineral rights to be abandoned and then vested in the owner of the surface rights if, within a period of twenty years, no savings events have occurred to prevent abandonment. 3 One such savings event, and the savings event at issue in Chesapeake Exploration, L.L.C. v. Buell, 4 occurs when the mineral rights have been subject to a properly recorded title transaction. 5 In Buell, the Supreme Court of Ohio held that a recorded oil and gas lease constitutes a title transaction and is thus a savings event under the ODMA. 6 In his dissent, Justice Pfeifer correctly pointed out a significant issue with the majority s decision; namely, the majority s failure to apply the rule against superfluous statutory language. 7 Nevertheless, the outcome in Buell is an important case for 1. Chesapeake Exploration, L.L.C. v. Buell, 144 Ohio St. 3d 490, 495, 2015-Ohio , 45 N.E.3d 185, 190 (2015). 2. Id., 2015-Ohio , 45 N.E.3d at OHIO REV. CODE ANN (B)(3)(a) (LexisNexis 2014). The statute in relevant part states: (B) Any mineral interest held by any person, other than the owner of the surface of the lands subject to the interest, shall be deemed abandoned and vested in the owner of the surface of the lands subject to the interest if... none of the following applies... (3) Within the twenty years immediately preceding the date on which notice is served or published under division (E) of this section, one or more of the following has occurred... (a) The mineral interest has been the subject of a title transaction that has been filed or recorded in the office of the county recorder of the county in which the lands are located (B)(3)(a) (emphasis added) Ohio St. 3d at 490, 2015-Ohio-4551, 45 N.E.3d at Buell, 144 Ohio St. 3d at 492, 2015-Ohio , 45 N.E.3d at 188; (B)(3)(a). 6. Id. at 508, 2015-Ohio , 45 N.E.3d at Id. at 509, , 2015-Ohio , 89, 90, 45 N.E.3d at (Pfeifer, J., dissenting) ( If the General Assembly intended to include leases, why would it delete the language from the original bill that expressly included leases? And why would it bypass the inclusion of leases recommended in the UDMIA, of which it surely was aware? ). 907

2 908 OHIO NORTHERN UNIVERSITY LAW REVIEW [Vol. 42 present and future litigation under the ODMA, and it will provide muchneeded guidance to the Ohio oil and gas industry. 8 II. STATEMENT OF FACTUAL AND PROCEDURAL HISTORY The controversy in Buell arose from a series of labyrinthine oil and gas leases that took place over more than fifty years. 9 In 1958, the disputed mineral rights were severed from the surface rights of a parcel of land in Harrison County by the Powhatan Mining Company, and were then transferred to North American Coal Corporation upon the merger of the two companies. 10 In 1984, North American Coal leased and recorded the mineral rights, and in 1989 the lease expired by its terms, and the rights reverted again to North American Coal. 11 In 2008, North American [Coal] transferred the mineral rights to North American Coal Royalty Company ( Coal Royalty )...., and in 2009 Coal Royalty leased the mineral rights to subsequent companies. 12 The subsequent lessees assigned and transferred portions of their interests to other companies. 13 Petitioners the lessor, lessees, and assignees of the mineral rights filed an action to quiet title against the surface owners in the United States District Court for the Southern District of Ohio, Eastern Division. 14 Respondents, the surface owners, counterclaimed, asserting ownership of the disputed mineral rights. 15 The District Court, absent precedent on the issue, certified two questions of state law for the Supreme Court of Ohio to answer: first, whether a recorded oil and gas lease is a title transaction that constitutes a savings event under Ohio Revised Code section (B)(3)(a); 16 and second, whether the expiration of said lease is a title transaction that constitutes a savings event under the same statute. 17 Petitioners argued that an oil and gas lease, and the expiration thereof, constitutes a title transaction under a plain reading of section (B)(3)(a). 18 Respondents argued that an oil and gas lease is merely a license, and thus not a title transaction at all. 19 The majority answer[ed] 8. See infra Part IV.B.ii. 9. Buell, 144 Ohio St. 3d at 491, 2015-Ohio , 45 N.E.3d at Id., 2015-Ohio , 45 N.E.3d at Id., 2015-Ohio , 45 N.E.3d at Id., 2015-Ohio , 45 N.E.3d at Id. at 492, 2015-Ohio , 45 N.E.3d at Buell, 144 Ohio St. 3d at 492, 2015-Ohio , 45 N.E.3d at 188. Petitioners include the following companies: Chesapeake Exploration, L.L.C., CHK Utica, Larchmont, Dale Pennsylvania Royalty, Coal Royalty, and Total E&P. Id. 15. Id., 2015-Ohio , 45 N.E.3d at Id., 2015-Ohio , 45 N.E.3d at See id., 2015-Ohio , 45 N.E.3d at Id. at , 2015-Ohio , 45 N.E.3d at Buell, 144 Ohio St. 3d at 493, 2015-Ohio , 45 N.E.3d at 189.

3 2016] CHESAPEAKE EXPLORATION, L.L.C. V. BUELL 909 the first certified state-law question in the affirmative and the second in the negative. 20 III. THE COURT S DECISION AND RATIONALE A. Majority Opinion by Chief Justice O Connor Writing the majority decision for the Supreme Court of Ohio, Chief Justice O Connor held that a recorded lease of a severed subsurface mineral estate (i.e. an oil and gas lease) is a title transaction that constitutes a savings event under the ODMA, whereas the expiration thereof is not. 21 Regarding issue one, the Court first looked to the definition of a title transaction under Ohio s Marketable Title Act ( MTA ). 22 The MTA defines a title transaction as any transaction affecting title to any interest in land, including by will or descent, title by tax deed, or by trustee s, assignee s, guardian s, executor s, administrator s, or sheriff s deed, or decree of any court, as well as warranty deed, quit claim deed, or mortgage. 23 Relying on elementary rules of statutory construction, the Court noted that the word any, appearing twice in the definition, was a word of inclusion instead of exclusion. 24 Thus, a title transaction could reasonably include a recorded oil and gas lease. 25 Second, the Court inquired into the nature of an oil and gas lease to determine whether such a lease affects title.... within the meaning of the definition of a title transaction under the MTA. 26 The Court looked to Eisenbarth v. Reusser, 27 where the Ohio Seventh District Court of Appeals answered the precise issue and held that a recorded oil and gas lease is a title transaction under the [ODMA]. 28 The Seventh District Court of Appeals reached this decision by creating an analogy between a mortgage, which is enumerated in the MTA as a title transaction, and an oil and gas 20. Id. at 509, 2015-Ohio , 45 N.E.3d at Id., 2015-Ohio , 45 N.E.3d at Id. at 497, 2015-Ohio , 45 N.E.3d at 192. This is because the ODMA does not define a title transaction, and the ODMA is part of the MTA. 23. Id., 2015-Ohio , 45 N.E.3d at 192 (quoting OHIO REV. CODE ANN (F) (LexisNexis 1961)). 24. Buell, 144 Ohio St. 3d at 497, 2015-Ohio , 45 N.E.3d at 192 (citing State v. Gardner, 118 Ohio St. 3d 420, 425, 2008-Ohio , 889 N.E.2d 995, 1003 (2008); Wachendorf v. Shaver, 149 Ohio St. 231, 240, 78 N.E.2d 370, 375 (1948)) ( We have long held that the use of the term any in a phrase encompasses every and all examples of the subject described. ). 25. See id. at 498, 2015-Ohio , 45 N.E.3d at Id. at , 2015-Ohio , 45 N.E.3d at Ohio-3792, 18 N.E.3d 477 (7th Dist. 2014). 28. Buell, 144 Ohio St. 3d at 501, 2015-Ohio , 45 N.E.3d at 195 (citing Eisenbarth, 2014-Ohio , 18 N.E.2d at 484).

4 910 OHIO NORTHERN UNIVERSITY LAW REVIEW [Vol. 42 lease. 29 A mortgage is an encumbrance that affects title.... insofar as it stays with the realty if title is conveyed during the terms of the encumbrance, and an oil and gas lease does the very same thing. 30 Therefore, an oil and gas lease, like a mortgage, is a title transaction that should serve as a savings event under the ODMA. 31 Further, an oil and gas lease restricts the transferability of the surface and mineral estates, reduces the lessor s ownership interest in the oil and gas against the interest of the lessee, and forecloses the ability of the lessor or any third party to freely access the property for exploration, development, and extraction of mineral resources. 32 As such, the Court concluded that an oil and gas lease is a title transaction under the ODMA because it is a transaction affecting title to an interest in land. 33 Next, the Court analyzed the second issue: whether the unrecorded expiration of a recorded oil and gas lease is a title transaction that constitutes a savings event under the ODMA. 34 Finding no Ohio authority directly on point, the Court held that [t]he mere unrecorded expiration of a recorded lease and the reversion of rights cannot restart the clock. 35 In reaching this conclusion, the Court drew a sharp distinction between a formally recorded expiration of a lease, and an unrecorded expiration of a lease. 36 Ohio law considers the formal release of rights under an oil and gas lease to be a title transaction, but does not consider the mere expiration of those rights to be a title transaction. 37 Therefore, the Supreme Court of Ohio was ultimately not convinced that the expiration of rights under [an oil and gas] lease constitutes a title transaction. 38 Last, the Court discussed the policy behind the ODMA and stated that it favored holding that the unrecorded expiration of a lease does not constitute a savings event. 39 The purpose of the savings devices in the ODMA is to 29. Id., 2015-Ohio , 45 N.E.3d at 195 (citing Eisenbarth, 2014-Ohio , 18 N.E.2d at 484) 30. Id., 2015-Ohio , 45 N.E.3d at 195 (citing Eisenbarth, 2014-Ohio , 18 N.E.2d at ) (emphasis added). 31. Id. at 503, 2015-Ohio , 45 N.E.3d at 197. ( We find that... the mineral interest has been the subject of a title transaction because the oil and gas lease affects title to the surface and mineral interests in land in a number of ways. ). 32. Id. at , 2015-Ohio , 45 N.E.3d at Buell, 144 Ohio St. 3d at 504, 2015-Ohio , 45 N.E.3d at Id. at 505, 2015-Ohio , 45 N.E.3d at Id., 2015-Ohio , 45 N.E.3d at Id. at 506, 2015-Ohio , N.E.3d at Id., 2015-Ohio , 45 N.E.3d at 199 (citing McLaughlin v. CNX Gas Co., No. 5:13CV1502, 2013 WL , at *5 (N.D. Ohio Dec. 13, 2013); Schucht v. Bedway Land & Minerals Co., No. CVH , 2014 Ohio Misc. LEXIS 89, at *9 (Ohio Ct. Com. Pl. Apr. 21, 2014); Davis v. Consolidation Coal Co., Harrison C.P. No. CVH , at *3, 7 (2013)). 38. Buell, 144 Ohio St. 3d at 506, 2015-Ohio , 45 N.E.3d at See id. at 508, 2015-Ohio , 45 N.E.3d at 201.

5 2016] CHESAPEAKE EXPLORATION, L.L.C. V. BUELL 911 incentivize holders of mineral rights to be diligent and keep track of their rights. 40 Additionally, there are other savings events under the ODMA that a mineral rights holder could utilize to preserve their rights, such as produc[ing] or withdraw[ing] [] minerals during the term of the lease.... or by merely filing a claim under the statute. 41 B. Concurring Opinion by Justice Kennedy Justice Kennedy concurred with the majority s judgment on both issues, but disagreed with the analysis regarding certified question number one whether a recorded oil and gas lease constitutes a title transaction under the ODMA. 42 Justice Kennedy stated that she would take the majority decision a step further to hold that any transaction that must be recorded must be a title transaction Justice Kennedy supported her conclusion with the fact that the recording requirement in Ohio Revised Code section (F) is to provide a public record of transactions affecting title to land. 44 C. Dissenting Opinion by Justice Pfeifer Justice Pfeifer wrote a dissent in which he disagreed with the majority s conclusion that an oil and gas lease is a title transaction under the ODMA. 45 The dissenting opinion stems principally from the majority s interpretation of the ODMA, and is bolstered by legislative history and policy. 46 Justice Pfeifer pointed to several important facts that support his argument that an oil and gas lease is not a title transaction under the ODMA: first, the recording of an oil and gas lease is not expressly enumerated as a savings event under the ODMA; second, a recorded oil and gas lease is not listed expressly as a title transaction under the MTA definition; third, a recorded oil and gas lease is different from the other title transactions listed in the MTA definition; fourth, oil and gas leases were originally listed as savings events in the model ODMA, but were taken out before the ODMA was enacted thus evidencing an intention by the legislature not to include oil 40. Id., 2015-Ohio , 45 N.E.3d at 201 ( If a lessee fails to record a release upon expiration, an attentive mineral-rights holder can act to ensure that a saving event preserves the mineral interest. ). 41. Id. at , 2015-Ohio , 45 N.E.3d at 201 (citing (B)(3)(b), (e)). 42. Id. at 517, 2015-Ohio , 45 N.E.3d at 208 (Kennedy, J., concurring). 43. Buell, 144 Ohio St. 3d at , 2015-Ohio , 45 N.E.3d at 208 (Kennedy, J., concurring) (emphasis added). 44. Id., 2015-Ohio , 45 N.E.3d at 208 (Kennedy, J., concurring) (internal citations omitted). 45. Id. at , 2015-Ohio , 45 N.E.3d at 202 (Pfeifer, J., dissenting) ( I would hold that the recorded lease of a subsurface mineral estate is not a title transaction under [the ODMA]. ). 46. See id. at , 2015-Ohio , 90, 45 N.E.3d at (Pfeifer, J., dissenting).

6 912 OHIO NORTHERN UNIVERSITY LAW REVIEW [Vol. 42 and gas leases as title transactions; and finally, oil and gas leases are listed as savings events under the ODMA when production or development under the lease is procured. 47 Accordingly, there is ample evidence to conclude that the Ohio General Assembly did not intend for oil and gas leases, absent production or development, to constitute savings events; this conclusion is congruous with the purpose of the ODMA, which is to encourage the use of Ohio s natural resources. 48 IV. ANALYSIS A. Introduction The majority in Buell incorrectly interpreted the ODMA when they failed to recognize perhaps one of the most powerful canons of 49 construction: the rule against superfluous statutory language. Nevertheless, the decision in Buell will provide much-needed guidance for Ohio courts and the Ohio oil and gas industry in regards to the legal consequences of a recorded oil and gas lease and the unrecorded expiration thereof under the highly-litigated ODMA. 50 B. Discussion i. The Rule Against Superfluous Statutory Language When parsing out the language of ambiguous statutes, judges often employ semantic canons of construction. These canons are deeply ingrained in common law tradition; indeed, they have been described as: a judicial presumption maybe weak, maybe strong, maybe super strong in favor of or against a particular substantive outcome. It is possible to conceive of such canons as representing generic approximations of congressional intent: Because the judge thinks it extremely unlikely that Congress would want result X, the judge will refuse to read the statute to mandate result X unless the statute clearly requires it... On that understanding, the substantive canons are judge-made principles, grounded in commitment to certain 47. Id. at 512, 2015-Ohio , 45 N.E.3d at 204 (Pfeifer, J., dissenting). 48. Buell, 144 Ohio St. 3d at , 2015-Ohio , 45 N.E.3d at (Pfeifer, J., dissenting). 49. The canon was properly recognized and applied by Justice Pfeifer. Id. at 509, , Ohio , 89-90, 45 N.E.3d at (Pfeifer, J., dissenting). 50. See infra Part IV.B.ii.

7 2016] CHESAPEAKE EXPLORATION, L.L.C. V. BUELL 913 systemic (perhaps constitutional) values rather than empirical beliefs about actual congressional intent. 51 One such canon, the rule against superfluous statutory language, stands for a solitary proposition: interpretations that render certain statutory language superfluous are disfavored. 52 The rule is very powerful insofar as its invocation can be dispositive in difficult statutory interpretation cases. 53 The Supreme Court of Ohio frequently employs the rule against superfluous statutory language. 54 For example, in Boley v. Goodyear Tire & Rubber Co., 55 Clayton Adams was employed as a pipefitter for Goodyear from 1973 to Clayton was exposed to materials containing asbestos during his tenure at Goodyear, and Mary, Clayton s wife, would breathe in the asbestos dust contained in Clayton s clothing when he would come home from work. 57 In early 2007, Mary was diagnosed with malignant mesothelioma, and she died later that year. 58 The executor of Mary s estate, Cheryl Boley, sued multiple defendants, including Goodyear Tire and Rubber Co., alleging that Goodyear s negligence exposed Mary to asbestos, and that this exposure caused her mesothelioma. 59 Goodyear moved for summary judgment under Ohio Revised Code section (A)(1), which states that premise owners are not liable for any injury to any individual resulting from asbestos exposure unless that individual s alleged exposure occurred while the individual was at the premises owner s property. 60 The issue in Boley was whether section (A)(1) applied to take home exposure asbestos cases against a family member s employer who exposed the employee to asbestos and that family member brought 51. JOHN F. MANNING & MATTHEW C. STEPHENSON, LEGISLATION AND REGULATION 202 (Robert C. Clark et al. eds., 2d ed. 2013) [hereinafter LEGISLATION AND REGULATION]. 52. Id. at The rule is frequently invoked by the United States Supreme Court. See, e.g., Gustafson v. Alloyd Co., 513 U.S. 561, 591 (1995); Corley v. U.S., 556 U.S. 303, 314 (2009); TRW Inc. v. Andrews, 534 U.S. 19, 31 (2001); Duncan v. Walker, 533 U.S. 167, 174 (2001); Milner v. Dep t of the Navy, 562 U.S. 562, 575 (2011) ( [S]tatutes should be read to avoid making any provision superfluous, void, or insignificant. ). 54. See, e.g., State ex rel. Myers v. Bd. of Educ., 95 Ohio St. 367, 373, 116 N.E. 516 (1917) (The court must look at the statute as a whole and give[] such interpretation as will give effect to every word and clause in it. No part should be treated as superfluous unless that is manifestly required, and the court should avoid that construction which renders a provision meaningless or inoperative. ) Ohio St. 3d 510, 2010-Ohio-2550, 929 N.E.2d 448 (2010). 56. Boley, 125 Ohio St. 3d at 511, 2010-Ohio , 929 N.E.2d at Id., 2010-Ohio , 929 N.E.2d at Id., 2010-Ohio , 929 N.E.2d at Id., 2010-Ohio , 929 N.E.2d at Id., 2010-Ohio , 929 N.E.2d at 450 (quoting OHIO REV. CODE ANN (A)(1) (LexisNexis 2004)).

8 914 OHIO NORTHERN UNIVERSITY LAW REVIEW [Vol. 42 asbestos home on their clothing causing other family members to become exposed to asbestos, and develop an asbestos related disease. 61 Boley argued that section (A)(1) was inapplicable to her claims because Mary s exposure to the asbestos occurred in her home instead of on Goodyear s premises. 62 Goodyear argued that Boley s interpretation of the statute would render section (A)(1) entirely superfluous because division (A)(1) expressly bars liability for asbestos exposure that occurs off of the premise owner s property. 63 Invoking the rule against superfluous statutory language, the Supreme Court of Ohio ruled in favor of Goodyear. 64 As eloquently explained by Justice O Donnell: Were we to apply the interpretation offered by Clayton and Boley, which is to read the phrase exposure to asbestos in R.C (A) as modifying on the premises owner s property, we would be giving no meaning to subdivision (A)(1). Specifically, the event that would prohibit liability pursuant to subdivision (A)(1) asbestos exposure away from the premises owner s property would also preclude R.C (A)(1) from barring such claims. The better view is to read the statute to give effect to all of its parts. 65 Therefore, the Court rejected the proposition that the proper way to read a statute is to do so in such a way that would render the Ohio General Assembly. 66 In Buell, the rule against superfluous statutory language should have swayed the majority, as it did in Boley. 67 Concurring in part and dissenting in part,, Justice Pfeifer noted that under the proposed bill for the ODMA, the Ohio General Assembly initially included oil and gas leases as savings events. 68 The proposed act was based on the Uniform Dormant Mineral Interests Act ( UDMIA ), which also contained oil and gas leases as savings events. 69 Nevertheless, the Ohio General Assembly ultimately 61. Boley, 125 Ohio St. 3d at 511, 2010-Ohio , 929 N.E.2d at Id. at , 2010-Ohio , 929 N.E.2d at Id. at 512, 2010-Ohio , 929 N.E.2d at See id. at , 2010-Ohio , 929 N.E.2d at Id. at 514, 2010-Ohio , 929 N.E.2d at See Boley, 125 Ohio St. 3d at 514, 2010-Ohio , 929 N.E.2d at See id., 2010-Ohio , 929 N.E.2d at Buell, 144 Ohio St. 3d at , 2015-Ohio , 45 N.E.3d at 203 (Pfeifer, J., dissenting). 69. See id., 2015-Ohio , 45 N.E.3d at 203 (Pfeifer, J., dissenting).

9 2016] CHESAPEAKE EXPLORATION, L.L.C. V. BUELL 915 decided not to include oil and gas leases in the final version of the bill, evidencing an intention contrary to the majority s decision. 70 Accordingly, Justice Pfeifer asked: If the General Assembly intended to include leases, why would it delete the language from the original bill that expressly included leases? 71 The answer is quite clear if the Ohio General Assembly wanted to include oil and gas leases as title transactions, then it simply would have included them in the final version of the bill. Furthermore, assuming, arguendo, that the Ohio General Assembly wanted to include recorded oil and gas leases as a savings events, then the savings event requiring production and development under an oil and gas lease would be rendered entirely superfluous. 72 This conclusion was impliedly adopted by the majority even though it should have been barred by the rule against superfluous statutory language. 73 As such, Justice Pfeifer s statutory interpretation was correct, and the majority failed in its role to determine legislative intent ii. The Importance of the Decision for Current and Future Litigation Under the ODMA In 2008, the commercial hydraulic fracturing industry spurred an economic boom in communities across Eastern Ohio. 75 Competing landmen armed with company checkbooks scoured the Ohio countryside hunting for leasing opportunities. 76 Those who owned land above the Marcellus and Utica shale plays benefited the most financially. 77 For many, owning land in these areas was comparable to owning a winning lottery ticket. 78 Unfortunately for others, the path to prosperity.... was not so clear because of issues concerning ownership of mineral rights. 79 The ODMA was enacted in part to resolve such title ambiguities with mineral rights. 80 Consequently, the ODMA has become one of the most litigated 70. See id., 2015-Ohio , 45 N.E.3d at 203 (Pfeifer, J., dissenting). 71. Id. at 511, 2015-Ohio , 45 N.E.3d at 203 (Pfeifer, J., dissenting). 72. See id. at 512, 2015-Ohio , 45 N.E.3d at 204 (Pfeifer, J., dissenting). 73. See Buell, 144 Ohio St. 3d at 512, 2015-Ohio , 45 N.E.3d at 204 (Pfeifer, J., dissenting). 74. See id. at 497, 2015-Ohio , 45 N.E.3d at Fenner L. Stewart, When the Shale Gale Hit Ohio: The Failures of the Dormant Mineral Act, its Heroic Interpretations, and Grave Choices Facing the Supreme Court, 43 CAP. U. L. REV. 435, (2015). 76. Id. at See id. 78. See Spencer Hunt, Eastern Ohio Swept by Drillers Land Rush, THE COLUMBUS DISPATCH (Nov. 20, 2010, 5:37 AM), Stewart, supra note 75, at Buell, 144 Ohio St. 3d at 495, 2015-Ohio , 45 N.E.3d at 190.

10 916 OHIO NORTHERN UNIVERSITY LAW REVIEW [Vol. 42 statutes in the state. 81 In Buell, the Supreme Court of Ohio resolved a statutory ambiguity in the ODMA when it held that a recorded oil and gas lease is a title transaction, whereas the unrecorded expiration of the lease is not. 82 Accordingly, the decision will have far-reaching implications for both the Ohio oil and gas industry and the State of Ohio. In Buell, The Ohio Oil and Gas Association ( OOGA ) wrote an amicus curiae brief in support of the petitioners, and described itself as: a trade association with over 3,300 members who are involved in all aspects of the exploration, production, and development of oil and natural gas resources within Ohio. Its members include independent producers as well as major national and international energy companies that focus on discovering and developing these resources. OOGA members also include Ohio contractors, service and supply companies, manufacturers, utilities, accountants, lawyers, bankers, geologists, insurers, engineers, royalty owners, landowners, and others who depend upon oil and gas production activities. In fact, the Ohio oil and natural gas industry provides more than 17,000 jobs and pays three-quarters of a billion dollars in salaries and income each year, and these numbers will increase dramatically through further development of the Utica Shale. 83 The OOGA, representing a significant segment of the Ohio oil and gas industry, wanted the Court to avoid answering whether an oil and gas lease is a conveyance of an interest in real property because such a determination would wreak havoc.... with other areas of Ohio law dealing with oil and gas leases. 84 In short, the OOGA simply wanted the Court to answer the certified questions in either the affirmative or the negative because [e]veryone involved in Ohio s gas and oil industry, from landowners and lessors to lenders and lessees, needs certainty and predictability in the ways these statutes apply to oil and gas leases. 85 The State of Ohio, acknowledging that it had a significant financial interest in the outcome of the case, wrote an amicus brief in support of the respondents: 81. See Stewart, supra note 75, at 438; 1-14 OHIO REAL PROPERTY LAW AND PRACTICE (2015) [hereinafter PRACTICE] ( The recent technological developments allowing for access to the Marcellus Shale plays and Utica Shale plays in eastern Ohio counties has led to a dramatic increase in litigation over suspected abandoned mineral interests. ). 82. Buell, 144 Ohio St. 3d at 508, 2015-Ohio , 45 N.E.3d at Brief of Amicus Curiae Ohio Oil & Gas Ass n in Support of Petitioners on One Issue Raised by Amicus Curiae State of Ohio at 2, Chesapeake Exploration L.L.C., v. Buell, 144 Ohio St. 3d 490, 2015-Ohio-4551, 45 N.E.3d 185 (2015) (No ) [hereinafter Ohio Oil & Gas Ass n]. 84. Id. at Id.

11 2016] CHESAPEAKE EXPLORATION, L.L.C. V. BUELL 917 [A]s a property owner itself, the State s interest in the outcome of this case is similar to the interest of many other property owners throughout Ohio. In many instances, ownership of the mineral rights underlying state land has reverted to the State by operation of the Dormant Minerals Act. Thus the State has an interest in preserving ownership of those mineral interests that have vested in itself and in similarly situated surface property owners. 86 Holding that a recorded oil and gas lease is a title transaction and that an unrecorded expiration of oil and gas lease is not under the ODMA, the Court in Buell granted the OOGA s wish insofar as there is now more certainty under the ODMA; the Ohio oil and gas industry can take comfort in the fact that recorded oil and gas leases will operate as savings events under the ODMA and thus preclude automatic divesting. 87 On the other hand, the State of Ohio, as a major landowner...., did not reap the benefits of an enormous financial windfall V. CONCLUSION In Buell, the Supreme Court of Ohio provided much needed clarity for landowners and the Ohio oil and gas industry when it determined that a recorded oil and gas lease constitutes a title transaction (and thus a savings event) under the ODMA, whereas the unrecorded expiration thereof does not. 89 Even though the majority in Buell failed to properly ascertain the legislative intent behind the ODMA, the decision will continue to be influential in other cases, and Ohio oil and gas practitioners should be keenly aware.... of their outcomes. 90 JONATHAN M. D ANDREA 86. Merit Brief of Amicus Curiae State of Ohio in Support of Respondents at 3, Chesapeake Exploration L.L.C. v. Buell, 144 Ohio St. 3d 490, 2015-Ohio-4551, 45 N.E.3d 185 (2015) (No ). 87. See Buell, 144 Ohio St. 3d at 508, 2015-Ohio , 45 N.E.3d at Ohio Oil & Gas Ass n, supra note 83, at Buell, 144 Ohio St. 3d at 508, 2015-Ohio , 45 N.E.3d at PRACTICE, supra note 81.