Wood v. Simmers

2019 Ohio 4440
CourtOhio Court of Appeals
DecidedOctober 29, 2019
Docket19AP-275
StatusPublished

This text of 2019 Ohio 4440 (Wood v. Simmers) is published on Counsel Stack Legal Research, covering Ohio Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Wood v. Simmers, 2019 Ohio 4440 (Ohio Ct. App. 2019).

Opinion

[Cite as Wood v. Simmers, 2019-Ohio-4440.]

IN THE COURT OF APPEALS OF OHIO

TENTH APPELLATE DISTRICT

Donald E. Wood, :

Appellant-Appellant, : No. 19AP-275 v. : (C.P.C. No. 18CV-9845)

Richard J. Simmers, Chief, : (ACCELERATED CALENDAR) Ohio Division of Oil & Gas Resources Management, :

Appellee-Appellee. :

D E C I S I O N

Rendered on October 29, 2019

On brief: Donald E. Wood, pro se. Argued: Donald E. Wood.

On brief: Dave Yost, Attorney General, Gene D. Park, and Jacquelyn Fisher, for appellee. Argued: Gene D. Park.

APPEAL from the Franklin County Court of Common Pleas

NELSON, J. {¶ 1} We find this a straightforward case because even in the unlikely circumstance that "may" in the relevant statutory section could be read properly to mean "shall," the use of the word "will" in a related administrative code provision could not sensibly mean "will (or shall, or may) not." {¶ 2} Donald E. Wood, a lawyer as well as an owner/operator of 16 oil and gas wells in Ohio, wants to mount an argument that in the context of the particular regulatory scheme requiring well owners to provide a surety bond or cash deposit to ensure compliance with land restoration and related environmental rules, see R.C. 1509.07(B)(1) and (2), the statutory grant of authority to the chief of the department of natural resource's division of oil and gas management to accept a net financial worth statement in lieu of such bond or cash deposit ("[i]nstead of a surety bond, the chief may accept proof of financial No. 19AP-275 2

responsibility consisting of a sworn financial statement showing a net financial worth within this state equal to twice the amount of the bond for which it substitutes * * *"), R.C. 1509.07(B)(3), creates a mandatory obligation for the chief to accept such a financial statement and precludes the chief from requiring a bond or cash. Here, "may" means "shall," Mr. Wood submits: "use of the word 'may' in the statute does not give the [chief] discretion to reject financial statements as proof of financial responsibility." Appellant's Brief at 18. {¶ 3} But apart from the dubious merits of Mr. Wood's rejection of any distinction here between "may" and "shall" (even in a statutory section that uses "shall" in some contexts and "may" in others, compare, e.g., R.C. 1509.07(A)(1) ("an owner of any well * * * shall obtain liability insurance coverage"); (A)(2) ("shall obtain" coverage that "shall include" coverage available for an environmental endorsement); (A)(3) ("shall maintain" and "shall provide" proof of coverage until wells plugged); and (B)(1) (except as otherwise provided, owner "shall execute and file" surety bond conditioned on compliance with restoration and plugging requirements), with (B)(2) (owner "may deposit with the chief, instead of a surety bond, cash in an amount equal to the surety bond * * * or negotiable certificates of deposit or irrevocable letters of credit," and chief "shall deliver them to the secretary of state"); (B)(3) ("[i]nstead of a surety bond, the chief may accept" a sworn financial statement meeting certain specifications)), Mr. Wood fails to contend adequately with the question of what happens when a well owner does not timely submit an annual financial statement, even when reminded to do so and given additional time. {¶ 4} As it happens, Ohio has an administrative code provision for that. Ohio Admin.Code 1501:9-1-03(F) relates to sworn financial statements that "may be accepted in lieu of a surety bond, [etc.]" for non-domestic well owners (like Mr. Wood) "for whom the chief has accepted a sworn financial statement prior to January 1, 1993." Each such owner "shall demonstrate financial responsibility annually" on a schedule established by the division of oil and gas management. Ohio Admin.Code 1501:9-1-03(F)(2)(a). And the "[f]ailure of an owner to demonstrate financial responsibility as required" under that regulatory subsection "will result in an order by the chief requiring a surety bond, certificate of deposit, or cash bond in the amount of bond required. If the order is not complied with, the owner will receive an order by the chief requiring the plugging of all wells of the owner." Ohio Admin.Code 1501:9-1-03(F)(2)(f)(i) (emphasis added). No. 19AP-275 3

{¶ 5} Because that is what happened here—that is, because Mr. Wood, who previously had been permitted to file financial statements, did not file his annual statement of financial responsibility as due in 2014—even after the division prompted him to do so and accorded him additional months to make such a filing—the chief issued an order requiring him to provide a surety bond, certificate of deposit, or cash bond in the amount of bond required, or to plug his wells or transfer them to an owner who would comply with Ohio's environmental regulations in this regard. {¶ 6} Mr. Wood appealed that order to Ohio's Oil and Gas commission, which affirmed it, and he then appealed that determination to the court of common pleas pursuant to R.C. 1509.37. The common pleas court upheld the commission order as lawful and reasonable, and Mr. Wood now has turned to us. We will affirm the judgment of the common pleas court, which did not abuse its discretion in finding that the commission acted in accordance with law based on the facts. "When the financial statement is not submitted, Ohio Admin.Code 1501:9-1-03(F)2)(f)(i) authorizes [indeed, we would say it requires] the order requiring the filing of a surety bond, certificate of deposit, or cash bond." April 11, 2019 Decision and Judgment Entry Affirming the Order of the Ohio Oil & Gas Commission, at 6; see also id. at 9. {¶ 7} The decision of the common pleas court describes this matter in some detail; we provide a thumbnail sketch, and need not rehearse here the only tangentially related, ill-fated efforts by Mr. Wood to have the commission certify a class as discussed in Wood v. Simmers, 10th Dist. No. 17AP-269, 2017-Ohio-8718 ("Wood I"), or to overturn the chief's order through a declaratory judgment action filed in and then appropriately dismissed by the court of claims, see Wood v. Div. of Oil & Gas Resources Mgt., 10th Dist. No. 18AP-470, 2018-Ohio-4968 ("Wood II"). {¶ 8} The uncontested record reflects that Mr. Wood, in lieu of a surety bond, submitted sworn financial statements in somewhat desultory fashion between 1986 and 2013. "Mr. Wood did not file or update his financial statements on a yearly basis. Rather, it appears that Mr. Wood usually updated his statements only when prompted by the Division." October 29, 2018 Findings, Conclusions & Order of the Commission at 5. Although he filed such a statement on November 21, 2013, he did not file in 2014. "In January of 2015, the Division mailed to Mr. Wood a letter reminding him of his annual obligation to file or update his financial statement. This letter gave Mr. Wood 60 days to No. 19AP-275 4

file an updated financial statement or to request an extension of this deadline." Id. at 2. "Mr. Wood did not file an updated financial statement during the approximately six-month period after he was notified in January 2015 of his obligation to submit an updated financial statement." Id. at 3; see also Decision and Judgment Entry at 1 ("Mr. Wood did not submit a financial statement within 60 days [of the January 2015 letter] or request an extension of time"). {¶ 9} Consequently, on July 7, 2015, Richard Simmers, chief of the department's division of oil and gas resources management, issued an order directing that within 30 days Mr. Wood "[e]xecute and file a surety bond, certificate of deposit, irrevocable letter of credit, cash or cashier's check with the Division, as required by R.C. 1509.07(B)," or plug and abandon his wells or transfer them to another owner. July 7, 2015, Chief's Order at 2.

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Bluebook (online)
2019 Ohio 4440, Counsel Stack Legal Research, https://law.counselstack.com/opinion/wood-v-simmers-ohioctapp-2019.