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Blile v. Staley

Court of Appeals of Ohio, Seventh District, Harrison

December 19, 2017

ROGER L. BLILE, ET AL., PLAINTIFFS-APPELLANTS,
v.
GUY J. STALEY, ET AL., DEFENDANTS-APPELLEES.

         Civil Appeal from Court of Common Pleas of Harrison County, Ohio Case No. CVH-2015-0108

          For Plaintiffs-Appellants Attorney David J. Wigham Attorney James P. Burke Attorney Lucas K. Palmer Attorney J. Benjamin Fraifogl Attorney Jason R. Ramsey.

          For Defendants-Appellees ESK ORI LLC, GDK ORI LLC, GWK ORI LLC, JEM ORI LLC, KBK ORI LLC, RHDK Oil and Gas LLC Attorney Giuseppe Ionno Attorney Nathan D. Vaughan.

          For Defendants-Appellees Guy J. Staley Norma Staley Attorney Michael D. Dortch Attorney Justin M. Dortch.

          For Defendant-Appellee Ascent Resources, Utica, LLC Attorney Daniel P. Craig Attorney Kevin L. Colosimo.

          Hon. Gene Donofrio Hon. Cheryl L. Waite Hon. Mary DeGenaro, Judge.

          OPINION

          DONOFRIO, J.

         {¶1} Plaintiffs-appellants, Roger Blile, Peggy Blile, Blair Heavilin, Carol Heavilin, Brent Heavilin, Melissa Heavilin, Larry Talkington, Becky Dillman, Stephen Kidd, and Heather Kidd, appeal from a Harrison County Common Pleas Court judgment granting a motion to dismiss their complaint filed by defendants-appellees, Ascent Resources-Utica, LLC (Ascent), Guy and Norma Staley (the Staleys), and ESK ORI LLC, GDK ORI LLC, GWK ORI LLC, JEM ORI LLC, KBK ORI LLC, AND RHDK Oil & Gas LLC (collectively referred to as ESK).

         {¶2} On April 26, 1976, Guy and Norma Staley leased the oil and gas rights underlying their 179-acre farm (the Staley Farm) to the East Ohio Gas Company (the Staley Lease). The Staley Lease was for an initial term of three years "and so much longer thereafter either (1) as oil or gas or their constituents shall be found on the premises in paying quantities * * * or as the premises shall be operated by the Lessee in the search for oil or gas, or (2) as gas shall be injected, stored or held in storage, or removed into, in and from any sands, strata or formation underlying the premises." A single well was drilled and completed on the Staley Farm on September 20, 1978.

         {¶3} On January 10, 1980, the Staleys conveyed the Staley Farm to Bradley Knight by warranty deed (the Knight Deed). The Knight Deed contained a mineral reservation (Staley Reservation) that provided:

EXCEPTING AND RESERVING to the Grantors, their heirs and assigns the following minerals and mineral rights with respect to all of the above described premises:
3) All oil and gas and any interests that the Grantors may presently have in any existing oil and/or gas leases; provided, however, Grantors covenant and agree that the future oil and/or gas wells shall be located upon the surface of said premises so as not to unreasonably interfere with any agricultural uses of said premises. Further, Grantors covenant and agree to assign to Grantee any right they may presently have or hereafter acquire to receive natural gas for domestic purposes in connection with any presently [sic] or future gas well on said premises.

         {¶4} Appellants collectively now own approximately 164.79 acres of the 179-acre Staley Farm. Ascent and ESK, in addition to the Staleys' remaining interest, have acquired interests in the Staley Lease through various assignments.

         {¶5} On September 23, 2015, appellants filed a complaint seeking a declaration that the Staley Lease terminated by its express terms due to a lack of production during the secondary term of the lease and, as a result, those claiming an interest in the oil and gas underlying the Staley Farm no longer possessed any interest. Appellants further sought a declaration that the Staley Reservation had terminated because it was tied to any interests the Staleys presently had in any existing oil and gas leases. Thus, appellants sought to quiet title in the oil and gas underlying the Staley ...


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