Northern Forests II, Inc. v. Keta Realty Co.

130 A.3d 19, 2015 WL 8159161
Superior Court of Pennsylvania·Decided December 4, 2015·No. 1007 MDA 2014·Published·Cited by 52 cases

Opinion

OPINION BY

JENKINS, J.:

Northern Forests II, Inc. (“NF”) filed an action to quiet title in 1988 and entered a default judgment in its favor in 1989. In 2013, the trial court ordered the judgment stricken as void ab initio due to lack of jurisdiction. Subsequently,- NF filed an amended complaint alleging that it owned the subject property via adverse possession on the basis of the 1989 judgment. In an order entered on May 20, 2014 and clarified on June 16, 2014, the trial court sustained the preliminary objections of multiple defendants and dismissed the amended complaint for failure to state a cause of action.

NF and Ultra Resources, Inc. (“Ultra”), a lessee of NF, filed timely appeals from the order of dismissal. We affirm.

*25 I.

Pursuant to a deed dated June 24,1987, NF acquired approximately 3,665 acres of land in Lycoming County designated as Warrants 1620, 1621, 1622 and 1626 (“the Property”). On December 12, 1988, NF filed an action to quiet title against five named defendants, 1 their heirs and assigns, and anyone claiming by, through or under them. NF’s complaint alleged that NF owned all oil, gas and mineral subsurface rights relating to the Property on the theory of adverse possession. At the time of NF’s action, however, none of the named defendants had any ownership interest in the subsurface rights, a fact that was evident from instruments of record in the Lycoming County Recorder of Deeds. Instruments of record as of December 1988 showed that record title owners of subsurface rights included Clarence Moore (“Moore”), 2 Kenneth Yates, a co-tenant of Moore (“Yates”), 3 and the heirs of Thomas Proctor (“Proctor Heirs”). 4

On December 13, 1988, one day after filing the complaint, NF’s attorney filed a “motion and affidavit for leave to obtain service by advertisement”. The affidavit consisted of one sentence in which the attorney averred that he “does not know the current whereabouts of the defendants, and the principals of the corporate entities are unknown, and he does not know any successors or assigns of the above or anyone claiming by, through or under them, or any of,them.” The affidavit requested that the court permit service “on the defendants, their successors and assigns, and anyone claiming by, through or under them or any of them by publication.” The affidavit said nothing about whether the attorney did any investigation into the defendants’. whereabouts before filing his motion for alternative service.

On December 16, 1988, the trial court granted NF’s motion for alternative service. Subsequently, counsel for NF entered six separate publications in local newspapers relating to the complaint. Each publication stated that NF had filed an action to quiet title and identified the metes and bounds of the land .subject to the quiet title action. None of these publications, however, named Moore, the Proctor Heirs, or Yates; they merely purported to notify the five named defendants and their “successors and assigns” about the lawsuit. ■

On February 6, 1989, counsel for NF filed a petition for judgment along with his affidavit that defendants had been, served by publication but had not filed an answer “although the time [in] which to do so has expired.” On February 10,1989, the court entered a default judgment against all defendants “unless defendants, within thirty days of this order commence an action in ejectment.” No defendant filed an action *26 in ejectment. On April 4, 1989, NF entered a final judgment via praecipe.

Between 1989 and 2012, various enetgy companies entered into real estate transactions and oil/gas leases with regard to the Property. In' late 2012 and early 2013, these energy companies — International Development Corporation (“IDC”), Southwestern Energy Production ' Company (“Southwestern”), Lancaster Exploration and Development Company (“Lancaster”), and two Anadarko entities, Anadarko E & P Company and Anadarko Petroleum Corporation (collectively “Anadarko”) — filed petitions to strike or open the judgment, alleging'that they own certain subsurface rights in the Property as successors in interest to Moore, Yates and/or the Proctor Heirs. 5 Southwestern and Anadarko claimed that Moore, Yates and the Proctor Heirs were indispensable parties in NF’s 1988-action, and NF’s failure to join thém rendered NF’s judgment void. Moreover, all petitioners claimed that NF’s counsel’s 1988 affidavit failed to explain why NF could not make regular service on the named defendants or the nature.or extent of NF’s investigation to -locate potential defendants. This, petitioners said, constituted another defect on the face of’ the record which rendered the judgment void. 6

In a memorandum and order dated February 8, 2013, the trial court struck NF’s' judgment on the ground that NF failed to make proper service of process on the original named defendants. 7 The court certified the order for immediate interlocutory appeal, but the Superior Court subsequently denied NF’s motion for leave to take an interlocutory appeal.

Subsequently, the trial court granted NF leave to file an amended complaint. On January 29, 2014, NF filed an amended complaint alleging three counts: (1) adverse possession for more than 21 years before 1988, (2) adverse possession based on the 1989 judgment, and (3) a declaratory judgment that NF owned the mineral rights, subject only to certain interests under or through NF. NF’s amended com: plaint named over 90 defendants, including several of NF’s successors and assigns whose interests are similar to NF’s, viz., Ultra Resources (“Ultra”), Chesapeake Appalachia (“Chesapeake”), and Statoil USA (“Statoil”).

• Multiple defendants — Mountain Development Group, Inc., Cynthia McKenney, the Proctor Heirs, IDC and Lancaster— filed preliminary objections alleging that NF failed to state a cause of action. Ana-darko and Southwestern both filed answers to the amended complaint and subsequently filed motions for summary judgment. Chesapeake and Statoil filed *27 an answer to the amended complaint. Ultra did not file a responsive pleading.'

In an opinion'and order on May 20, 2014, the court sustained the preliminary objections and dismissed NF’s amended complaint for. failure to state a cause of action. On June 16, 2014, the court amended its order to clarify that the order of dismissal applied to all defendants. 8 NF and Ultra filed timely notices of appeal, and NF, Ultra and the trial court complied with Pa.R.A.P.1925. ' '

IL

NF raises the following issues on appeal:

1. Did the trial court, in its Order filed on February 11, 2013 (later amended by Order filed on March 6, 2013 to grant the Plaintiff permission to take an interlocutory appeal), err in striking the 1989 Judgment?

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Northern Forests II, Inc. v. Keta Realty Co., 130 A.3d 19, 2015 WL 8159161 (Pa. Ct. App. 2015).

130 A.3d 19 (Northern Forests II, Inc. v. Keta Realty Co.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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