The Ohio Dormant Mineral Act: Still a Mess
Many landowners in Ohio have known about the Ohio Dormant Mineral Act. Originally enacted as part of the Ohio Marketable Title Act it was passed in 1989 and went fully into effect in 1992 after a three-year waiting period which was designed to allow landowners the opportunity to protect their rights. One of the purposes of the act was supposedly to make it easier to determine who was the owner of old severed oil and gas mineral interests. The act itself, however, never applied to coal ownership. The law provided, generally, that certain mineral interest could be deemed abandoned if they had not been used by the original owner, or their heirs and assigns, during a 20-year window. The law was amended in 2006 and at that time additional requirements were added which more clearly stated that a landowner wishing to claim abandonment needed to take certain actions and provide certain types of notice to the mineral owners who might be subject to losing their interests. The question remained, however, what happened with those mineral interests that could be deemed abandoned under the old version of the law.
Neither version of law was passed with a vision to the billions of dollars that would be at stake with the advent of the Marcellus and Utica Shale plays. The sheer amount of money at issue made for large scale and numerous legal attacks and litigation related to the Ohio Dormant Mineral Act. Just over a year and a half ago the Ohio Supreme Court, in a surprising ruling, attempted to provide some simplification and guidance regarding the two laws. The Court ruled that the original 1989 Act was not self-executing. That meant that even if the requirements of claiming the abandonment of a mineral interest were met, the landowner still had to do something to claim those rights. They had to file some time-of-action in the court system to affirm their claims. The majority thinking before that decision was that the law did not require such action and the mineral interest reattached to the surface interest automatically. The court determined after the new law went into effect in 2006, that a landowner had to then comply with the provision of the 2006 act to claim abandonment and had to undertake the more stringent research and notice requirements.
This has now led to a whole host of new litigation issues including potential claims that attorneys performing ODMA work might have committed malpractice. Much of the litigation and unrest now lies in the question of whether attorneys and landowners conducted sufficient due diligence and research to find the heirs of the old severed mineral interest. For many years it seemed that research in the county recorder, probate and/or tax offices would be sufficient to identify the heirs of long lost reservations. Now it seems that this research might not be enough. Are you required to research genealogical databases or simply conduct web searches for people and addresses? Many people who did hire attorneys and proceed under the requirements of the 2006 act are now being sued or contacted by people claiming that they should have received notice of the abandonment claims and should have had the opportunity to respond accordingly. What was supposed to have become a settled area of law which clearer ownership has continued to be a muddied mess. Unfortunately, even for people who signed leases and were paid based on the provision of the ODMA, you might still face uncertainty and litigations.
Today's blog: Jeremy McGraw explains the reach of the Ohio Dormant Mineral Act and what exactly it includes, or more specifically, what was left off of the original bill.