Justia Ohio Supreme Court Opinion Summaries

The Public Utilities Commission approved a capacity charge for the American Electric Power operating companies - Ohio Power Company and Columbus Southern Power (collectively, AEP) - and authorized AEP to implement a new cost-based charge for capacity service that AEP offers to competitive retail electric service (CRES) providers. The Ohio Consumers’ Counsel (OCC) appealed, and AEP cross-appealed. The Supreme Court affirmed the Commission’s orders in part and reversed them in part, holding (1) OCC’s propositions of law failed; and (2) AEP identified one instance where the Commission committed reversible error. Remanded. View "In re Comm’n Review of the Capacity Charges of Ohio Power Co." on Justia Law

These consolidated actions involved an original action in the Supreme Court and an appeal of a judgment of the court of appeals and concerned the interpretation of several nearly identical oil and gas leases. In the original action, Relator, an absent and unnamed plaintiff in a class action, challenged the court of appeals’ order tolling the leases in the class action pending appeal and sought writs of prohibition and mandamus. The appeal challenged the court of appeals’ interpretation of the leases in the class action. The Supreme Court (1) affirmed the judgment of the court of appeals in the class action, holding that the court of appeals correctly interpreted the leases; (2) denied a writ of mandamus or prohibition in the original action because Relator had an adequate remedy in the ordinary course of law by moving to intervene in the appeal and because the court of appeals did not patently and unambiguously lack jurisdiction to issue an order tolling the leases; and (3) denied the motions of the appellee in the appeal to toll the terms of the leases. View "State ex rel. Claugus Family Farm, L.P. v. Seventh Dist. Court of Appeals" on Justia Law

The parties in this case disputed who was the legal owner or holder of certain mineral rights. The United States District Court for the Southern District of Ohio, Eastern Division concluded that the interpretation of Ohio’s Dormant Mineral Act in the context of an oil and gas lease was determinative of the case and certified certain questions to the Supreme Court for answers. The questions were as follows: (1) whether a recorded lease of a severed subsurface mineral estate is a title transaction under the Act, and (2) whether the expiration of a recorded lease and the reversion of the rights granted under that lease is a title transaction that restarts the twenty-year forfeiture clock under the Act at the time of the reversion. The Supreme Court answered (1) a recorded lease of severed oil and gas rights is a title transaction under Ohio Rev. Code 5301.56(B)(3)(a) that constitutes a saving event to preclude the severed mineral rights from being deemed abandoned and reunited with the rights to the corresponding surface property; but (2) the unrecorded expiration of such a lease is not a title transaction that restarts the twenty-year clock under the Act. View "Chesapeake Exploration, LLC v. Buell" on Justia Law

In 2009, Appellants acquired by way of a deed the surface rights to certain land in Harrison County. The deed did not convey to Appellants all of the mineral rights underlying their surface property. But after an oil and gas company inquired about leasing the mineral rights to the land, Appellants initiated procedures under the Dormant Mineral Act to have the mineral interests deemed abandoned and vested in them along with their surface ownership. Less than one month after Appellants published a notice of abandonment of the mineral interests underlying their property, John Croskey recorded a quitclaim deed for mineral interests underlying the property. The trial court determined that the Croskey affidavit preserved the mineral-rights holders’ interests for purposes of the Dormant Mineral Act and thus concluded that Appellants could not establish a claim for the abandonment of the oil and gas rights underlying their surface property. The Supreme Court affirmed, holding that a mineral-interest holder’s claim to preserve filed pursuant to Ohio Rev. Code 5301.56(H)(1)(a) is sufficient to preclude the mineral interests from being deemed abandoned if filed within sixty days after notice of the surface owner’s intent to declare those interests abandoned. View "Dodd v. Croskey" on Justia Law

Ohio Rev. Code 1509 gives state government “sole and exclusive authority” to regulate the permitting, location, and spacing of oil and gas wells and production operations within Ohio. Beck Energy Corporation obtained a permit from the Ohio Department of Natural Resources in order to drill an oil and gas well on property within the corporate limits of the City of Munroe Falls. When Beck Energy began drilling, the City filed a complaint seeking injunctive relief and alleging that Beck Energy was violating several provisions of the Munroe Falls Codified Ordinances. The trial court issued a permanent injunction prohibiting Beck Energy from drilling until it complied with all local ordinances. The court of appeals reversed, concluding that section 1509.02 prohibited the City from enforcing the five ordinances. In so holding, the court rejected the City’s argument that the Home Rule Amendment to the Ohio Constitution allowed the City to impose its own permit requirements on oil and gas drilling operations. The Supreme Court affirmed, holding that the Home Rule Amendment does not grant the City the power to discriminate against, unfairly impede, or obstruct oil and gas activities and production operations that the State has permitted under chapter 1509. View "State ex rel. Morrison v. Beck Energy Corp." on Justia Law

Reporting that it suffered underrecovered transmission costs of $36 million during the period under review, the Ohio Power Company filed an application to recover the underrecovered transmission costs associated with providing transmission service to its standard-service-offer customers. The Public Utilities Commission approved the application, determining that Ohio Power could collect the underrecovered costs from both shopping and nonshopping customers. Industrial Energy Users-Ohio (IEU) appealed, arguing that the Commission abused its discretion by allowing Ohio Power to recover the underrecovered transmission costs from shopping customers. The Supreme Court affirmed, holding that the IEU did not meet its burden of demonstrating that the Commission’s orders were unjust, unreasonable, or unlawful. View "In re Application of Ohio Power Co." on Justia Law

After a portion of an oil and gas lease's interest was assigned to Chesapeake Exploration, LLC, the Ohio Division of Oil and Gas Resources Management (Division) issued a permit to Chesapeake to drill an oil and gas well on the lease property. Summitcrest, Inc., who originally entered into the lease with the assignor, appealed to the Oil and Gas Commission (Commission). The Division filed a motion to dismiss the appeal, claiming that the issuance of permits to drill oil and gas wells did not constitute an appealable order. Chesapeake joined in the Division's motion to dismiss. The Commission denied the motion to dismiss. Chesapeake filed this action for a writ of prohibition to prevent the Commission from exercising further jurisdiction in the appeal and to vacate the Commission's actions in the appeal. The Commission subsequently heard the appeal and affirmed the issuance of the drilling permit. Thereafter, Respondents filed a motion to dismiss the prohibition case based on mootness, which the Supreme Court denied. The Supreme Court then granted the writ, holding that the Commission patently and unambiguously lacked jurisdiction over the appeal from the Division's issuance of the permit. View "Chesapeake Exploration, LLC v. Oil & Gas Comm'n" on Justia Law

Duke Energy Ohio, Inc. sought to recover over $30 million for the costs of restoring its system following the destruction caused by Hurricane Ike. The Public Utilities Commission allowed Duke to recover roughly half that amount, finding that several of Duke's requests lacked adequate supporting evidence. Duke appealed, raising five propositions of law, all variations on the theme that the Commission's order lacked record support. The Supreme Court affirmed, holding (1) the Commission's finding reducing the amount that Duke could recover because it found substantial problems with the supporting evidence was confirmed by the record; and (2) each of Duke's arguments lacked merit. View "In re Application of Duke Energy Ohio, Inc." on Justia Law

Buckeye Wind filed an application to construct a proposed wind-powered electric generation facility with the power siting board (the board). A group of neighboring landowners (the neighbors) opposed the application. Several other entities, including the county and several local townships (collectively, the county) also intervened. The board approved construction of most of the proposed turbines. The neighbors and county appealed. Buckeye intervened on behalf of the board. The Supreme Court affirmed, holding that the board acted in accordance with all pertinent statutes and regulations and based its determinations on the evidence in the record, and therefore, the board's decision was reasonable and lawful. View "In re Application of Buckeye Wind, LLC" on Justia Law

Five companies entered into special contracts with the Toledo Edison Company for the sale of electricity. The Public Utilities Commission of Ohio (PUCO) established February 2008 as the termination date for the contracts, basing its finding on the language of the special contracts and its orders in earlier electric-deregulation cases. Appellants challenged the decision, contending (1) Toledo Edison agreed in 2001 that the contracts would not terminate until Toledo Edison stopped collecting regulatory-transition charges from its customers, and (2) December 31, 2008 was the date when Toledo Edison stopped collecting regulatory-transition charges. The Supreme Court reversed, holding that the PUCO ignored the plain language of the 2001 amendments to Appellants' special contracts, and accordingly, the PUCO unlawfully and unreasonably allowed Toledo Edison to terminate the special contracts in February 2008. View "Martin Marietta Magnesia Specialties, L.L.C. v. Pub. Util. Comm'n " on Justia Law