Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Conny Farms, Ltd v. Ball Resources

September 27, 2011

CONNY FARMS, LTD., PLAINTIFF-APPELLANT,
v.
BALL RESOURCES, INC, ET AL., DEFENDANTS-APPELLEES.



CHARACTER OF PROCEEDINGS:Civil Appeal from Common Pleas Court, Case No. 08CV833.

The opinion of the court was delivered by: DeGenaro, J.

Cite as Conny Farms, Ltd. v. Ball Resources, Inc.,

JUDGMENT: Reversed and Remanded.

JUDGES: Hon. Mary DeGenaro Hon. Gene Donofrio Hon. Joseph J. Vukovich

OPINION

{¶1} Plaintiff-Appellant, Conny Farms Ltd., appeals the judgment of the Columbiana County Court of Common Pleas granting summary judgment in favor of Defendants-Appellees*fn1 in a suit concerning the validity of two oil and gas leases on Conny Farms' property. The trial court granted summary judgment against Conny Farms due to a judicial ascertainment clause contained in both leases. Conny Farms argues this was erroneous because: (1) judicial ascertainment clauses are against public policy in Ohio; (2) the judicial ascertainment clause should not be enforced because the leases expired under their own terms pursuant to habendum clauses; and (3) genuine issues of material fact preclude summary judgment.

{¶2} Judicial ascertainment clauses are unenforceable in Ohio as against public policy, thus, the trial court erred by granting summary judgment in favor of Appellees and denying Conny Farms' summary judgment on this basis. But because the trial court concluded that the judicial ascertainment clause was enforceable, it did not rule on the merits of Conny Farms' remaining claims, and we must give the trial court the opportunity to do so. Accordingly, the judgment of the trial court is reversed, and the case remanded.

Facts and Procedural History

{¶3} Conny Farms is the record title owner of land in Columbiana County. Since 1950, there have been two oil and gas leases on that land, which were originally held by East Ohio Gas Company (nka Dominion East Ohio), but are now held by Appellees.*fn2 For convenience, the parties refer to the leases as the Gibson lease and the Thompson lease. The two leases are identical except for the dollar amounts, several dates, and the names of the original lessors.

{¶4} There was never a well drilled on the property, it was used for gas storage purposes only. Michael and Jennifer Conny purchased the property on October 7, 2005. Prior to purchasing the property, the Connys were provided with a title commitment which revealed the existence of the leases. The Connys transferred the property to Conny Farms Ltd. on September 6, 2006. Michael and Jennifer Conny are the sole members of Conny Farms Ltd. Both the Connys and Conny Farms admit they had knowledge of the leases prior to taking ownership to the property.

{¶5} In a July 2, 2008 letter to lessees Ball Resources Inc. and William E. Blair, counsel for Conny Farms/The Connys stated the leases terminated because no payments had been made since the Connys took ownership of the property in 2005, and demanded cancellation of the leases.

{¶6} Counsel for Ball Resources and Blair responded in a July 16, 2008 letter that he was aware of the transfer of the property to the Connys since his office handled the closing, noted the Connys were provided with the leases were represented by independent third-party counsel in connection with that transaction, and stated with regard to the notice provision in the leases: "It is my understanding that Mr. Conny never notified Dominion as to the transfer of ownership in this property and did not notify my clients prior to the notification contained in your July 2, 2008 correspondence. Based upon your July 2, 2008 correspondence, we will now transfer the storage rental to Mr. Conny in accordance with the terms of the subject leases."

{¶7} And in a July 23, 2008 follow-up letter, counsel for Ball Resources and Blair provided documentation of the storage rental payments made by their predecessor in interest, Dominion, to the Connys' predecessor-in-interest, Klaus Forester, from April 2001 through May 2005. This letter went on to state:

{ΒΆ8} "Storage rental payments thereafter were suspended by Dominion East Ohio since your client [Conny Farms] did not notify them of the real estate transfer. Based upon the notification contained in your July 2, 2008 correspondence regarding this transfer, these suspended funds will be transferred to Mr. Conny in the immediate future. Based upon this payment history and the express terms of ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.