PETITION FOR REVIEW (BOARD OF PROPERTY).
Kenneth F. Yates, with him, Terry Bossert, McNees, Wallace & Nurick, Harrisburg, for petitioner.
Martha R. Smith, Asst. Counsel, Harrisburg, for respondent.
Crumlish, Jr., President Judge,*fn* and Barry and McGinley, JJ.
[ 129 Pa. Commw. Page 630]
Clarence W. Moore (Moore), petitioner, seeks our review of an order of the Board of Property which denied his claim of title to a mineral estate in an 18,780 acre tract situated in Lycoming County (described by warrants listed in Exhibits III, V and VI to the petition to the Board of Property). There is no dispute that the Commonwealth through the Department of Environmental Resources (DER) possesses title to the surface estate of the same tract. Moore, however, asserts that his possession and claim of title to the mineral estate is superior.
We hold that Moore possesses title in fee simple absolute to a mineral estate in the tract here in issue. We, therefore, reverse.
In 1933, Central Pennsylvania Lumber Company (CPLC) conveyed to the Commonwealth a surface estate of approximately 30,000 acres of land located in Lycoming and Sullivan Counties, among which acreage is the appurtenant surface estate to the mineral estate in Lycoming County here in issue. CPLC effected a reservation of that mineral estate in this conveyance.
All of CPLC's reserved mineral estate was conveyed piecemeal to the Commissioners of Lycoming County over a
[ 129 Pa. Commw. Page 631]
period of time between 1933 and 1938, because of CPLC's failure to pay taxes assessed against the mineral estate. In 1950, Keta Realty Company acquired the mineral estate reserved by CPLC in principal part from the Lycoming County Commissioners and the remainder from CPLC which had regained title in that other portion. When Keta's subsequent parent corporation, Astra Oil and Gas Corp., filed for bankruptcy in 1958, among the assets disposed of by the trustee was the mineral estate here in issue. The trustee devised the estate in fee simple in 1966, and through a series of conveyances between 1966 and 1983, petitioner Moore acquired 100% of the oil and gas interests and 50% of the hard mineral interests which had been owned by Astra (i.e. Keta).
Petitioner Moore claims title to the mineral estate through CPLC, asserting that CPLC reserved a fee interest in the minerals. The Commonwealth claims title to the mineral estate by asserting that CPLC's reservation of the mineral rights was an estate for years, terminating 50 years from the date of the 1933 conveyance. Consequently, the Commonwealth avers that the separate and distinct mineral estate ended in 1983, resulting in title reverting to the Commonwealth.
On review, we are asked to determine whether the Board properly assigned the burdens of proof. We are asked as well to determine the effect of certain tax sales occurring in the periods from 1908-1926 and from 1933-1938 on the mineral estate here in issue. Additionally, we are asked to ascertain whether the Commonwealth is estopped from asserting that the mineral interest here comprises something less than an estate in fee simple absolute because of the Commonwealth's participation in the Astra bankruptcy proceeding where this mineral interest was disposed of by the trustee as an estate in fee.
In resolving this matter, we first note that in order to prevail in an action to quiet title, plaintiff must establish title by a fair preponderance of the evidence. Kaiser Energy v. Department of Environmental Resources,
[ 129 Pa. Commw. Page 632113]
Pa. Commonwealth Ct. 6, 535 A.2d 1255 (1988). Moreover, plaintiff has the burden of proving a prima facie title, which proof is sufficient until a better title is shown in the adverse party. Hallman v. Turns, 334 Pa. Superior Ct. 184, 189, 482 A.2d 1284, 1287 (1984). Furthermore, if plaintiff and defendant trace title from a common source, plaintiff thereby makes out a prima facie case, and thus defendant is called upon to prove his alleged title if he is to defeat plaintiff's apparent ownership. Dunn v. Milanovich, 302 Pa. 184, 152 A. 757 (1930) see also Babcock Lumber Co. v. Faust, 156 Pa. Superior Ct. 19, 39 A.2d 298 (1944).
In the instant matter, the Board of Property erred in construing the requirement that a plaintiff's need to rely on the strength of his own title and not on the weaknesses or deficiencies of defendant's title, imposed more than a duty to show his claim by a preponderance of the evidence. The Board mistakenly assigned to plaintiff-petitioner the duty to show his title by clear and convincing evidence. (Conclusion of Law # 2). Therefore, we proceed to review this matter assigning to petitioner the burden of making out his case on the standard of preponderance of the evidence presented before the Board.
We find that because petitioner and respondent claim title through a common source, namely CPLC's deed of March 28, 1933, conclusive evidence of petitioner's title on that date was shown. Clark v. Trindle, 52 Pa. 492, 497 (1866). We further find that since petitioner produced evidence showing a direct line of title from the reservation in the grantor created by that deed to himself, this made out a prima facie case in his favor. Hess v. Herrington, 73 Pa. 438 (1873). Defendant was then called upon to prove its alleged title.
We remark that the dispute about the effect of the tax sales from 1908 to 1926 is of no moment to our resolution of this dispute. In short, the Board of Property accurately determined that an unassessed mineral estate
[ 129 Pa. Commw. Page 633]
coexisting with an unseated surface estate is subject to extinguishment by the occurrence of a tax sale of the servient surface estate. See Proctor v. Sagamore Big Game Club, 166 F.Supp. 465 (W.D.Pa.1958). Whether the severance of the mineral and surface estates was extinguished by the tax sales of the surface estate between 1908 and 1926 is of little consequence to petitioner. Crucial to petitioner's claim to title however, is the quality of CPLC's title in 1933 when it reserved the mineral estate while conveying the surface estate to the Commonwealth. Should CPLC have had defective title to the whole of the estate here in question then petitioner's prima facie case might well have been suspect. That is not the case. We conclude, as did the Board, that CPLC possessed title to the whole of the estate in land, surface and subsurface rights, when in 1933 it made the conveyance which included the reservation of a mineral estate. Likewise, we find (and neither party contests) that, subsequent to the severance effected by CPLC's 1933 conveyance, the mineral estate was assessed for tax purposes separately and that because of CPLC's failure to satisfy its tax obligations, title to the mineral estate passed to the Lycoming County Commissioners. We also observe that none of these events reflect upon the quality of petitioner's prima facie case.
We now address the essence of the instant matter, which is to interpret the deed of March 28, 1933 so as to discern and effectuate the intention of the parties to that transaction.*fn1 The pertinent language for our examination is:
Also excepting and reserving unto the Grantor, its successors and assigns, all the oil, coal and gas now owned by it, the said Central Pennsylvania Lumber Company, in,
[ 129 Pa. Commw. Page 634]
under and upon the aforementioned and described four parcels of ground, with the rights of ingress, egress and regress upon and over said tracts of land for and during the term of fifty (50) years from the date of conveyance, together with the use of any part of the surface in the operation, development, protection and transportation of any oil, coal and gas according to such rules and regulations as may be from time to time adopted by the Secretary of the Department of Forests and Waters, but such rules shall at all times be reasonable and in harmony with the usual methods of operating and producing oil, coal and gas.
While both parties thought the language of this deed was unambiguous, the Board found it otherwise and invited the parties to present evidence tending to clarify any ambiguity. Specifically, the Board found this language susceptible of either of the diverse interpretations presented by the parties. Petitioner claims that the language reserved in fee simple absolute the mineral estate of the Exhibits III, V and VI warrants in CPLC. The Commonwealth claims that the language reserved to CPLC a fifty year reversionary interest in the mineral estate, which allegedly expired in March 1983.
The Board ultimately accepted the Commonwealth's interpretation in preference to that of the petitioner on the basis of the extrinsic evidence presented, particularly deeds containing similar language by which DER purchased acreage from third parties, and evidence of the sale price of other property acquired by the Commonwealth. The Board dismissed case law offered by the petitioner concerning the interpretation of similar reservations by deed, and considered as inadvertent error the sale of this mineral estate as an estate in fee by a trustee in bankruptcy.
[ 129 Pa. Commw. Page 635]
We find that petitioner's interpretation should prevail and that the Board of Property erred in not adhering to the persuasive guidance offered by our Supreme Court's decisions in O'Donnell v. Morris Run Mining Co., 319 Pa. 293, 179 A. 454 (1935) and in Strunk v. Morris Run Coal Page 635} Mining Co., 271 Pa. 148, 114 A. 519 (1921). These cases, dealing with similar language reserving mineral estates, were decided in close proximity to the execution of this deed. While the reservations effected in the O'Donnell and Strunk cases pertain in part to timber rights as well as to minerals, the analysis provided by these cases is dispositive of the interpretation in contention here.
We believe that the Strunk and O'Donnell cases make clear the meaning of the deed here in issue. For purposes of our exposition, we provide the language of the deed involved in this case side-by-side with the language in cases interpreted by our Supreme Court: