Popa, et al v. CNX Gas Company LLC, et al
Filing
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Memorandum of Opinion and Order For the reasons set forth herein, the Court grants Defendants' Motion to Dismiss (ECF No. 15 ). Judge Benita Y. Pearson on 7/30/2014. (JLG)
PEARSON, J.
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF OHIO
EASTERN DIVISION
PAUL POPA, et al.,
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Plaintiffs,
v.
CNX GAS COMPANY, LLC, et al.,
Defendants.
CASE NO. 4:14cv143
JUDGE BENITA Y. PEARSON
MEMORANDUM OF OPINION AND
ORDER [Regarding ECF No. 15]
Pending before the Court is the Motion to Dismiss filed by Defendants CNX Gas
Company LLC (“CNX”) and Hess Ohio Developments, LLC (“Hess”) (collectively,
“Defendants”). ECF No. 15. The Court has been advised, having reviewed the record, the
parties’ briefs, and the applicable law. For the reasons that follow, Defendants’ motion is
granted.
I. Background
A. Facts
This dispute involves the validity of an oil and gas lease that has experienced changes in
real-property ownership and mineral-rights assignments. Plaintiffs—Paul Popa, Thomas Muir,
and Sandra Muir—claim that the lease at issue is no longer valid, and that Defendants no longer
own the deep mineral rights underneath their respective properties.
1. Plaintiffs’ Land Ownership
Popa is the owner of a 73.92-acre parcel of real property located in Mahoning County,
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Ohio. ECF No. 14 at 3, ¶11. Thomas Muir and Sandra Muir together own a 65.25-acre parcel of
real property and ten acres of shallow mineral rights in one parcel of real property in Mahoning
County, Ohio. Id. at 3-4 ¶¶11-13. Together, the Popa and Muir parcels constitute a single
property for oil and gas purposes. Id. at 4, ¶14. The oil and gas rights for Plaintiffs’ property are
subject to separate oil and gas leases (collectively referred to as the “Lease”) that contain
identical language on pertinent parts.
2. The Lease
Plaintiffs’ predecessors-in-interest signed the Lease with the East Ohio Gas Company
(“EOG”) in 1961. ECF No. 14 at 3, ¶12(b). Like traditional oil and gas leases, the Lease
contained a granting clause that reads in part:
That the Lessor, for and in consideration of One-dollar ($1.00) and other valuable
consideration in hand paid by the Lessee, the receipt of which is hereby
acknowledged, and the covenants and agreements hereafter contained, does
hereby lease and let exclusively unto the Lessee, for the purpose of drilling,
operating for, producing and removing oil and gas and all the constituents thereof
...
ECF No. 21-2 at 1. The duration of the Lease is contained in the habendum clause. The
habendum clause holds the Lease in effect for “…twenty years and so much longer thereafter …
as oil or gas or their constituents shall be found on the premises in paying quantities in the
judgment of the Lessee…” Id. The lessee also has a right to create a “development unit” that
consolidates either of the leased premises with other land. Id. As a result, if the lessee operates a
well on part of the development unit, the Lease is extended with respect to the entire unit. Id.
The Lease concludes with a clause that states:
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All covenants and conditions between the parties hereto shall extend to their heirs,
personal representatives, successors and assigns, and the Lessor hereby warrants
and agrees to defend the title to the lands herein described. It is mutually agreed
that this instrument contains and expresses all of the agreements and
understandings of the parties in regard to the subject matter thereof, and no
implied covenant, agreement or obligation shall be read into this agreement or
imposed upon the parties or either of them.
Id.
3. Unitization
EOG consolidated or unitized Plaintiffs’ properties on November 10, 1972. ECF No.
14-12. After the unitization, EOG gradually assigned interest under the Lease to new parties.
EOG’s first assignment came on April 5, 1974 when it assigned its shallow rights to H.D.
Collins. ECF Nos. 14 at 4, ¶17; 17 at 7. There are currently two wells on the unit capable of
producing oil and gas from the shallow rights—one well is currently owned by D&L Energy and
is no longer producing, and the other well is owned by Everflow Eastern Partners L.P.
(“Everflow”) and is currently producing. Id. at 9, ¶¶50-53; ECF No. 17 at 8. EOG maintained its
ownership of the deep mineral rights until November 29, 2004 when it assigned this interest to
what is now Defendant CNX.1 ECF No. 17 at 8. CNX subsequently conveyed 50% of its
interest in the deep mineral rights to Defendant Hess. Id.
At that the filing of this lawsuit, Defendants were not operating a well on Plaintiffs’
unitized property and no party was operating a well that was producing oil or gas from the
1
The deep rights were originally assigned to Dominion Exploration & Production, Inc.
ECF No. 15-1. In 2001, the name of the record owner of the consolidated leases became “CNX
Gas Company, LLC.” ECF No. 15 at 2, ¶7.
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Defendants’ deep rights. The only activity on Plaintiffs’ unitized property is the Everflow well
accessing the shallow rights.
B. Claims
In their First Amended Complaint, Plaintiffs assert eight state law claims challenging the
Lease: breach of lease; forfeiture; expiration; lack of mutuality; lack of consideration; violation
of the implied covenant to reasonably develop; violation of Ohio public policy; and an action to
quiet title. ECF No. 14 at 6-20. Among other relief, Plaintiffs seek declaratory judgment under
R.C. § 2721.02(A), R.C. § 2721.03 and R.C. § 2721.04, that Defendants’ interest in the lands are
outside the development unit and have, therefore, expired. Id. at 5, 23-25; at 20, ¶126 G-H.
II. Legal Standard
A. Motion to Dismiss
In ruling on a motion to dismiss pursuant to Fed. R. Civ. Pro. 12(b)(6), the Court must
take all well-pleaded allegations as true and deduce the allegations in the light most favorable to
the plaintiff. Erickson v. Paradus, 551 U.S. 89, 94 (2007) (citations omitted). In order for a
complaint “to survive a motion to dismiss the complaint must . . . ‘state a claim to relief that is
plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atlantic Corp.
v. Twombly, 550 U.S. 544, 570 (2007)). The complaint must provide support for “legal
conclusions” with “factual allegations.” Id. at 679. Furthermore, the Court “should assume the[]
veracity” of factual allegations within the complaint. Id. However, the factual allegations must
be enough to raise a right to relief above a speculative level. Twombly, 550 U.S. at 555 (citing
authorities). Ultimately, the claims asserted within the complaint must be plausible and not
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merely conceivable. Id. at 570.
In addition to reviewing the claims set forth in the complaint, a court may also consider
exhibits, public records, and items appearing in the record of the case as long as the items are
referenced in the complaint and are central to the claims contained therein. Bassett v. Nat’l
Collegiate Athletic Ass’n, 528 F.3d 426, 430 (6th Cir. 2008); Erie County, Ohio v. Morton Salt,
Inc., 702 F.3d 860, 863 (6th Cir. 2012).
B. Ohio Contract Law
Both parties rely on Ohio state law in their filings. The Lease was signed in Ohio by
Ohio residents and an Ohio Corporation. See, e.g., ECF Nos. 21-1; 14-10 at 2. The properties
and interests in this case involve land that is located entirely in Ohio. As a result, Ohio contract
law controls the Court’s interpretation of the Lease in this diversity case. Oheyan v. Safeco Ins.
Co. of Illinois, 747 N.E.2d 206, 209 (Ohio 2001) (explaining that the choice of law lies with the
state having the most significant relationship to the transaction and parties, citing Restatement
(Second) of Conflict of Laws §188(1)). No party disputes the applicability of Ohio law.
In Ohio, the interpretation of a written lease agreement is a question of law. Heritage
Court LLC v. Merritt, 931 N.E.2d 194, 198 (Ohio Ct. App. 2010). Ohio courts assess leases
through “traditional rules of contract interpretation.” Mark-It Place Foods, Inc. v. New Plan
Excel Realty Trust, 804 N.E.2d 979, 992 (Ohio Ct. App. 2004). A court analyzes the terms of the
lease in order “to determine the intent of the parties.” Hamilton Ins. Services Inc., v. Nationwide
Ins. Cos., 714 N.E.2d 898, 900 (Ohio 1999). “The intent of the parties to a contract is presumed
to reside in the language they chose to employ in the contract.” Kelly v. Medical Life Ins. Co.,
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509 N.E.2d 411, 413 (Ohio 1987). “Common words appearing in a written instrument will be
given their ordinary meaning unless manifest absurdity results, or unless some other meaning is
clearly evidenced from the face or overall contents of the instrument.” Foster Wheeler
Enviresponse, Inc. v. Franklin County Convention Facilities Auth., 678 N.E.2d 519, 526 (Ohio
1997) (quoting Alexander v. Buckeye Pipe Line Co., 374 N.E.2d 146 (Ohio 1978)).
With respect to oil and gas leases, Ohio courts have addressed the instruments as follows:
The rights and remedies of the parties to an oil and gas lease must be determined
by the terms of the written instrument, and the law applicable to one form of lease
may not be, and generally is not, applicable to another and different form. Such
leases are contracts, and the terms of the contract with the law applicable to such
terms must govern the rights and remedies of the parties.
Swallie v. Rousenberg, 942 N.E.2d 1109, 1117 (Ohio Ct. App. 2010) (quoting Harris v. Ohio Oil
Co., 48 N.E. 502, 506 (Ohio 1897)).
III. Analysis
A. Breach of the Lease
Plaintiffs allege that Defendants and Defendants’ predecessors-in-interest breached the
Lease when they assigned interest under the Lease to other parties. ECF No. 14 at 7, 30-33.
Plaintiffs contend that there is a contradiction between the language in the Lease’s granting
clause and the final paragraph.2 Id. at 33-34; ECF No. 17 at 9-10. While the granting clause
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Plaintiffs referred to the Lease and assignments in the First Amended Complaint, and
filed copies as exhibits. As a result, the Court may consider these documents when ruling on the
motion to dismiss. See Bassett, 528 F.3d at 430 (“When a court is presented with a Rule 12(b)(6)
motion, it may consider the Complaint and any exhibits attached thereto, public records, [etc.] . .
. so long as they are referred to in the Complaint and are central to the claims contained
therein.”).
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states that Plaintiffs’ predecessors-in-interest “. . . lease and let exclusively unto the lessee . . .,”
the final paragraph of the Lease states that “[a]ll covenants and conditions between the parties
hereto shall extend to their heirs, personal representatives, successors and assigns . . .” ECF No.
21-1 at 1 (emphasis added). Plaintiffs assert that the word “exclusively” within the granting
clause indicates the parties’ intent to convey oil and gas rights to Defendants’
predecessor-in-interest, EOG, and no one else during the term of the Lease. ECF No. 14 at 7,
¶30-34. In other words, Plaintiffs contend that the term “exclusively” explicitly revoked EOG’s
right to assign interest under the Lease to other parties. Id.
Plaintiffs also contend that the language in the Lease that applies the terms to the parties’
“assigns” contradicts the granting clause. Id. at 7, 32-33. Plaintiffs argue that this creates an
ambiguity that the Court should construe against Defendants as the de facto drafter. Id.
Defendants maintain that there is no contradiction in the Lease, and that rights under a lease are
assignable without “an express clause prohibiting assignment.” ECF No. 20 at 3.
In order for a contradiction to exist within the Lease, the Court must interpret the term
“exclusively” in the granting clause as a restriction of the lessee’s right to assign. However, oil
and gas law recognizes the lessee’s right to partially or entirely assign interests “in the absence of
an express provision in the lease restraining assignments by the lease.” 2-4 WILLIAMS AND
MEYERS, OIL AND GAS LAW § 402 (2012) (emphasis added). Examples of language that
expressly waives or places a contingency on a lessee’s right to assign interest are as follows:
It is understood that the (Lessee) will not assign the above-mentioned lease in
whole or in part … without the consent of the Lessor.
This lease is made on the condition that the Lessee shall not sell any interest in the
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leasehold created hereby, or any rights to or interests in the oil and gas in place
without the prior consent of Lessor, and upon breach of said condition, this lease
shall terminate, at Lessor’s option.
Id. Though Ohio courts have not dealt with an alleged contradiction within a lease that pertains
to assignment and the term “exclusively” within a granting clause, an Ohio appellate court
described that a lessee “appear[ed]” to breach a lease by assigning an interest to a third party in
violation of language within the lease that stated:
This lease may not be assigned or transferred by lessee prior to the drilling and
completion of the (two wells) 2 wells without the prior written consent of lessor.
Curtis v. Am. Energy Development Inc., No. 2000-l-133 2002 WL 1357726, at *1-2 (Ohio Ct.
App. June 21, 2002).
In the instant case, the use of the term “exclusively” is unrelated to the lessor’s right to
assign. Unlike the examples above, the term “exclusively” lacks a specific reference to
assignability. This interpretation is also consistent with oil and gas lease forms. Such forms
employ the term “exclusively” in the same manner as the Lease in the instant case. See 5
SUMMERS OIL AND GAS § 60:3 (3d. ed.); 28A West’s Legal Forms, Specialized Forms §22:39; 3
Ohio Forms Legal and Bus. § 7b:29 (2013 ed.). Specifically, the granting clause in 3 Ohio Forms
Legal and Bus. §7b:29 (2012 ed.) uses “exclusively” in a manner identical to the Lease, while a
separate provision contains an express limit of the lessee’s assignment. The Court finds it
unlikely that a form would include a clause specifically limiting the right of assignment if the
term “exclusively” also pertained to the lessee’s right to assign. This would be redundant. Rules
of contract interpretation advise against interpretations that result in redundancy. See Eastham v.
Chesapeake Appalachia, L.L.C., —F.3d— , 2014 WL 2535385, at *4 (6th Cir. June 6, 2014)
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(citing Local Mktg. Corp. v. Prudential Ins. Co., 824 N.E.2d 122, 125 (Ohio Ct. App. 2004)).
As a result of the apparently common use of the term “exclusively” in the granting clause
and the Court’s obligation to ensure that “… no provision is to be wholly disregarded as
inconsistent with other provisions unless no other reasonable construction is possible,” the Court
finds the use of the term “exclusively” represents the parties’ intent with respect to the transfer of
rights between the parties, not the lessee’s right to make future assignments. Karabin v. State
Automobile Mutual Ins. Co., 462 N.E.2d 403 (Ohio 1984) (internal quotation marks and citation
omitted). Accordingly, Plaintiffs’ breach of lease claim is dismissed.
B. Expiration
Plaintiffs claim that the Lease has expired with respect to Defendants’ interest because
Defendants have not produced or engaged in any activity listed in the habendum clause. ECF
No. 14 at 9-11, 54-67. This argument is based on the premise that Defendants’ deep rights are
not part of the development unit held by the shallow Everflow well. ECF No. 17 at 14.
According to Plaintiffs, the Lease only applies to the shallow depths. Id. Defendants argue that
the development unit consists of all depths and that the Everflow well sustains the Lease in its
entirety per the habendum clause. ECF No. 20 at 6.
The habendum clause provides that the lease extends so long as the lessee finds oil or gas
“on the premises.” ECF No. 21-1 at 1. The language does not provide a depth restriction
attached to the lessee’s rights, and as a result, the habendum clause applies to all depths
underneath the surface. Nevertheless, because the original lessee, EOG, had the ability to extend
the lease by producing oil or gas from any depth, the Court must determine whether or not the
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assignments that followed the execution of the Lease severed the Lease and created separate
leases. If the rights initially obtained by EOG were severed, Defendants’ interest per the Lease is
outside of the development unit. Consequently, Defendants would be bound by a separate
habendum clause, and would have to produce from their deep rights in order to maintain their
interest.
The Court finds Gardner v. Oxford Oil Co., 7 N.E.3d 510 (Ohio Ct. App. 2013)
instructive. In Gardner, an oil company assigned its shallow rights under a lease but retained the
deep rights. Id. at 512. The court found that this partial assignment of rights “did not constitute
a new, separate conveyance or contract,” and that the deep rights “remained subject to the terms
of the original lease agreement.” Id. at 512, 515. Though Ohio courts have not dealt extensively
with the issue of determining whether or not assignments sever leases, the reasoning in Gardner
is analogous to the question of severance, and is consistent with standard oil and gas law. See
3-6 WILLIAMS AND MYERS OIL AND GAS § 604.10 (“Production by one partial assignee will
suffice to hold the lease as to interests of other partial assignees of the lessee.”); Caldwell v.
Kriebel Res. Co., LLC, 72 A.3d 611, 613 (Pa. Super. Ct. 2013) (lessor argued that lessee was
only producing from shallow depths; court recognized the lessee’s deep rights and did not sever
the lease).
Here, Defendants’ interest has not expired because the assignment did not sever the
Lease. As a result, the Everflow well sustains the Lease in its entirety per the habendum clause.
Plaintiffs’ expiration claim is dismissed.
C. Public Policy
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Plaintiffs allege that the Lease violates Ohio public policy because Defendants did not
produce within the deep rights of the Lease. ECF No. 14 at 12, ¶¶74-76. “It is the public policy
of the state of Ohio to encourage oil and gas production when the extraction of those resources
can be accomplished without undue threat of harm to the health, safety and welfare of the
citizens of Ohio.” Newbury Twp. Bd. of Trustees v. Lomak Petroleum (Ohio) Inc., 583 N.E.2d
302, 304 (Ohio 1992).
Ohio courts have found a violation of public policy in cases in which no production
occurred on the lessor’s land. In Ionno v. Glen-Gery Corp., 443 N.E.2d 504, 508 (Ohio 1983)
the Supreme Court of Ohio held that lessees who failed to engage in “…any sort of mining
production on the leased premises since the inception of the lease…” breached the lease and went
against public policy. Unlike Ionno, however, Plaintiffs’ unitized property is experiencing
production via the Everflow well. The Everflow production on the unitized property holds the
entire unitized property under the Lease. The presence of actual production on Plaintiffs’
property, therefore, distinguishes this case form Ionno.
Plaintiffs also rely on two cases from Ohio courts of common pleas in order to bolster
their public policy argument—Belmont Hills Country Club v. Beck Energy Corp., Case No.
11-CV-290 (Belmont County Court of Common Pleas, July 8, 2013) (ECF No. 17-1); and Clark
v. Myers, Case No. 12-CI-0278 (Coschocton County Court of Common Pleas, February 14,
2013) (ECF No. 17-3). The Court finds both cases distinguishable.
In Belmont Hills, the lessee engaged in no production on the property. In addition, the
language of the contract that the court deemed to be against public policy contained different
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language than the Lease in the instant case. ECF No. 17-1 at 6. The lease in Belmont Hills
enabled the lessee to maintain the lease
for a term of five years and as much longer thereafter as oil or gas or their
constituents are produced or are capable of being produced on the premises in
paying quantities, in the judgment of the Lessee, or as the premises shall be
operated by the lessee in search for oil and gas….
Id. (emphasis added). As a result, the Belmont Hills lease enables the lessee to maintain its rights
by merely determining that the land is capable of production. Unlike Belmont Hills, the Lease in
the instant case contains a habendum clause that enabled the lease to run:
… for a term of twenty years and so much longer thereafter (1) as either oil or gas
or their constituents shall be found on the premises in paying quantities in the
judgment of the Lessee or as the premises shall be operated by the Lessee in
search for oil or gas, or as gas shall be injected, stored, or held in storage, or
removed into, in and from and sands strata or formations underlying the premises.
ECF No. 21-1.
The language in the Lease’s habendum clause: “oil and gas . . . shall be found on the
premises in paying quantities in the judgment of the lessee” equates to production. The Ohio
Supreme Court has stated that leases in which “lessees must actually find oil in paying quantities,
. . . is the same as obtaining and producing it in paying quantities.” Murdock West Co. v. Logan,
69 N.E. 984, 985 (Ohio 1904). Unlike the Lease in the instant case, the lease in Belmont Hills
permits the lessee to extend by speculating as to whether or not the land is capable of producing
instead of requiring actual production. The court in Belmont Hills determined that the lease
violated public policy because the lessee “may extend the lease in question indefinitely by either
self-determining that oil and gas…are capable of being produced in paying quantities or
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commencing preparations for drilling.” Belmont Hills, Case No. 11-CV-290 (ECF No. 17-1 at
8).
In the instant case, the Lease allows no such freedom to the lessor because the lessor must
produce or engage in productive activity that develops the land. The language in the Lease’s
habendum clause regarding storage and removal reveals that the parties intended for the lessee to
engage in more than estimating the land’s production capabilities. Storage and removal are real,
productive activities that require action that affects the property, unlike determining capability.
Lastly, Clark is distinguishable from this case because the lessee in Clark engaged in
production for “ordinary household uses.” Case No. 12-CI-0278 (ECF No. 17-3 at 2). Ordinary,
household use is not considered production. Id. See also Morrison v. Petro Evaluating Services
Inc., No. 2004 CA 0004 2005 WL 2715578, at *5 ( Ohio Ct. App. Oct. 21, 2005) (domestic,
household use is not “production”). Plaintiffs provide no evidence that Everflow is using the
shallow depths well for domestic, household use.
Plaintiffs alternatively argue that the Lease lacks environmental standards and is outdated
with respect to public safety. ECF Nos. 12 at ¶¶77-78; 17 at 19. However, Plaintiffs provide no
legal authority that contemplates the environmental, health, or safety effects that contemporary
oil and gas production has when applied to older leases. Plaintiff has not alleged facts that
support such a finding. Accordingly, Plaintiffs’ claims with respect to health, safety, and the
environment are merely conceivable rather that plausible. See Iqbal, 556 U.S. at 678. Plaintiffs’
public policy claim is dismissed.
D. Breach of Implied Covenant to Reasonably Develop Land
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Ohio law recognizes the existence of implied covenants in oil and gas leases including the
implied covenant to reasonably develop the land. Am. Energy Serv. v. Lekan, 598 N.E.2d 1315,
1321 (Ohio Ct. App. 1992). Plaintiffs argue that Defendants breached an implied covenant to
reasonably develop the land because they did not produce within their deep rights. ECF No. 14
at 15, ¶¶94-95.
Generally, parties to an oil and gas lease may waive implied covenants. See Bushman v.
MFC Drilling Inc., Case No. 2403-M ,1995 WL 434409 at *2 (Ohio Ct. App. July 19, 1995)
(“While gas and oil leases contain an implied covenant requiring the lessee to reasonably develop
the leased property, Ohio courts have consistently enforced express provisions in such leases that
disclaim the implied covenant.”). In the instant case, the Lease states that “no implied covenant,
agreement or obligation shall be read into this agreement or imposed upon the parties or either of
them.” ECF No. 21-1 at 1. Therefore, the Lease contains an express provision that disclaims the
implied covenant.
Plaintiffs argue that the waiver in the Lease is a “general waiver,” and enforcing the
waiver would violate public policy. ECF No. 17 at 21. Plaintiffs submit that such a waiver is the
result of the freedom of contract, and that “complete freedom of contract is not permitted for
public-policy reasons.” ECF No. 17 at 22-23. However, Ohio case law applying general waivers
adequately considered public policy. See Bushman, 1995 WL 434409, at *2 (“we are unable to
conclude that public policy requires anything more than a general waiver of implied covenants.”).
The Court is also unable to conclude that the waiver violates public policy because, as already
described, development is occurring on the property. Accordingly, the Court dismisses
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Plaintiffs’ breach of implied covenant claim.
E. Forfeiture
The Court finds no merit in Plaintiffs’ forfeiture claim brought pursuant to R.C. §
5301.332. R.C. § 5301.332 applies to lands “upon which there are no producing or drilling oil or
gas wells…[and] failure of the lessee, his successors or assigns, to abide by specifically described
covenants provided for in the lease, or because the term of the lease has expired.” (Emphasis
added) Because the Court finds production within the development unit that holds the entire
lease, via the Everflow well, there is no lack of production. Plaintiffs’ forfeiture claim is
dismissed.
F. Lack of Mutuality and Consideration
Plaintiffs argue that the Lease lacks mutuality because Defendants do not have an
obligation to produce. ECF No. 17 at 25. However, as the Court has already stated, the
assignments of interest are not new contracts. Therefore, the Everflow well production fulfills
Defendants’ obligation to produce.
Plaintiffs also assert a failure of consideration claim. Id. Failure of consideration “is the
neglect, refusal and failure of one of the contracting parties to do, perform, or finish [the
consideration] after making and entering into the contract…” Henry v. Reich, 72 N.E.2d 500,
501 (Ohio Ct. App. 1947). Again, Plaintiffs rely on the assumption that Defendants are bound to
produce under the Lease. However, as assignees, Defendants are not parties to a new contract.
Instead, they are interest holders in a lease that requires production on the unitized property. See
Gardner, 7 N.E.3d at 515. The requisite production is occurring on the unitized property via the
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Everflow well. Plaintiffs’ lack of mutuality and consideration claims are dismissed.
G. Quiet Title
Plaintiffs assert a quiet title claim under R.C. §5303.01. ECF No. 14 at 19. “An action
may be brought by a person in possession of real property, by himself or tenant, against any
person who claims an interest therein adverse to him, for the purpose of determining such
adverse interest.” R.C. § 5303.01. Plaintiffs rely on Lansinger v. United Petroleum Corp., 471
N.E.2d 869 (Ohio Ct. App. 1984) in support of their argument that they lack an “adequate
remedy of law” for Defendants’ lack of production of their deep rights. ECF No. 14 at 19-20,
¶125. However, unlike the present case, Lansigner involved a lessee who “…had not drilled a
well which was producing oil or gas, as required by the lease.” Lansinger, 471 N.E.2d at 872.
Once again, Plaintiffs rely on the assumption that Defendants are bound by a separate version of
the Lease or have an interest outside of the development unit that requires them to produce their
deep rights. And once again, the Court finds that Defendants are bound by the Lease, which is
producing. As a result, Plaintiffs’ quiet title claim is dismissed.
IV. Conclusion
For the reasons explained above, the Court grants Defendants’ motion to dismiss (ECF
No. 15).
IT IS SO ORDERED.
July 30, 2014
Date
/s/ Benita Y. Pearson
Benita Y. Pearson
United States District Judge
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