Title: THR Minerals, LLC. v. Robinson

State: north-dakota

Issuer: North Dakota Supreme Court

Document:

IN THE SUPREME COURT STATE OF NORTH
DAKOTA 2017 ND 78THR Minerals,
LLC, Plaintiff and Appelleev.Stephen D. Robinson, as Trustee of the Grace D.
Robinson Irrevocable Trust, Mary Lou Stewart, Mark Allen Metzger, Charles A. Robinson, Paul
A. Robinson, William A. Robinson, Barbara B. Danner, Ellen W. Brewster, and L & M
Minerals, LLC, Defendants Charles A. Robinson, Paul A. Robinson, and William
A. Robinson, AppellantsNo. 20160062Appeal from the District
Court of Williams County, Northwest Judicial District, the Honorable David W. Nelson,
Judge.AFFIRMED.Opinion of the Court by McEvers, Justice.Jordon J. Evert, P.O. Box 417, Williston, N.D.
58802-0417, for plaintiff and appellee.Harry M.
Pippin, P.O. Box 1487, Williston, N.D. 58802-1487, for appellants.THR Minerals, LLC v. RobinsonNo.
20160062McEvers, Justice.[¶1] Charles
Robinson, Paul Robinson, and William Robinson appeal from an amended judgment, granting
summary judgment in favor of THR Minerals, LLC, and deciding ownership of mineral and
royalty interests in certain property. We conclude the assignment of royalty at issue is
unambiguous, and the district court did not err as a matter of law in construing the assignment to
decide the ownership of the subject mineral and royalty interests between the parties. We
affirm.I[¶2] In August 2014 THR filed an
amended complaint to quiet title to mineral and mineral royalty ownership in specific property
located in Williams County. Before suit was commenced, the various parties stipulated to the
ownership of the property as sought in THR's complaint, except for defendants Charles
Robinson, Paul Robinson, and William Robinson ("Robinsons"). In September 2014 the
Robinsons answered THR's complaint.[¶3] The dispute in this
case involves the interpretation of a 1942 "Assignment of Royalty," from Ivan and Oleta
Metzger, husband and wife, to assignee T.H. Richardson. It is undisputed that at the time of the
conveyance, the Metzgers owned a one-third interest in the property described in the assignment.
Based on their respective successor interests and interpretations of the assignment, THR asserts
the Metzgers conveyed to Richardson a 6.25 percent royalty interest in the entire property, while
the Robinsons contend the Metzgers created a 6.25 percent royalty burden on only the one-third
interest they actually owned.[¶4] THR moved the district court for
summary judgment, and the Robinsons filed a cross-motion for summary judgment. In January
2015 the district court held a hearing on the parties' motions. In March 2015 the court granted
THR partial summary judgment based on its interpretation of the 1942 assignment, which the
court concluded was unambiguous. The court held that "to be made whole, the heirs of T. H.
Richardson are entitled to 18.75% [i.e., three times 6.25 percent] of the interest owned
by Oleta and Ivan Metzger as a result of the February 17, 1942 conveyance." The court, however,
did not grant full summary judgment because the record did "not have the information to set out
current ownership" and was "not sufficient to establish what The Metzger[s'] owned prior to the
1942 deed, with sufficient proof to warrant a Quiet Title judgment."[¶5] In July 2015 THR again moved the district court for summary judgment,
submitting additional documents to establish chain of title to the property. The Robinsons again
opposed THR's motion, asserting summary judgment was inappropriate because "there absolutely
exists a genuine dispute regarding the existence of a material fact," in that "there is still a dispute
as to the interpretation of the February 17, 1942 Assignment of Royalty from Oleta and Ivan
Metzger to T.H. Richardson." In September 2015 the district court held a hearing on THR's
second summary judgment motion. In December 2015 the court entered amended findings of
fact, conclusions of law, and an order granting judgment in THR's favor. An amended judgment
was entered from which the Robinsons appeal.II[¶6] The Robinsons argue the district court erred in granting summary judgment
in favor of THR. Our standard of review for a district court's grant of summary judgment is well
established:Summary judgment is a procedural device for the prompt
resolution of a controversy on the merits without a trial if there are no genuine issues of material
fact or inferences that can reasonably be drawn from undisputed facts, or if the only issues to be
resolved are questions of law. A party moving for summary judgment has the burden of showing
there are no genuine issues of material fact and the moving party is entitled to judgment as a
matter of law. In determining whether summary judgment was appropriately granted, we must
view the evidence in the light most favorable to the party opposing the motion, and that party will
be given the benefit of all favorable inferences which can reasonably be drawn from the record.
On appeal, this Court decides whether the information available to the district court precluded
the existence of a genuine issue of material fact and entitled the moving party to judgment as a
matter of law. Whether the district court properly granted summary judgment is a question of law
which we review de novo on the entire record. Markgraf v. Welker, 2015 ND 303, ¶ 10, 873 N.W.2d 26 (quoting Hamilton v. Woll, 2012 ND 238, ¶ 9, 823 N.W.2d 754). "Summary
judgment is inappropriate if neither party is entitled to judgment as a matter of law or if
reasonable differences of opinion exist as to the inferences to be drawn from the undisputed
facts." Markgraf, at ¶ 10 (quoting Northern Oil & Gas, Inc. v. Creighton,
2013 ND 73, ¶ 11, 830 N.W.2d
556).III[¶7] The resolution of this case
depends on the proper interpretation of the 1942 assignment of royalty.[¶8] Generally, we interpret assignments and deeds in the same manner as
contracts, with the primary purpose to ascertain and effectuate the parties' or grantor's intent.
See Sargent Cty. Water Res. Dist. v.
Mathews, 2015 ND 277, ¶ 6,
871 N.W.2d 608; Golden v. SM Energy
Company, 2013 ND 17, ¶ 11,
826 N.W.2d 610; see also N.D.C.C. § 9-07-03. The parties' intent is ascertained
from the writing alone if possible. N.D.C.C. § 9-07-04. "The language of a contract is to
govern its interpretation if the language is clear and explicit and does not involve an absurdity."
N.D.C.C. § 9-07-02. "When the parties' intent can be determined from the contract
language alone, interpretation of a contract presents a question of law." Border Res., LLC v. Irish Oil & Gas, Inc.,
2015 ND 238, ¶ 15, 869 N.W.2d 758.
Similarly, when "an assignment is memorialized in a clear and unambiguous writing, a court
should not look to extrinsic evidence to ascertain intent." Golden, at ¶ 11. "[W]hen a contract is ambiguous,
[however,] extrinsic evidence may be considered to determine the parties' intent, and the contract
terms and the parties' intent become questions of fact." Border Res., at ¶ 15.[¶9]
The "Assignment of Royalty," executed on February 17, 1942, provides in relevant
part:KNOW ALL MEN BY THESE PRESENTS, That Ivan V. Metzger
and Oleta L. Metzger, his wife, of Williston, North Dakota, for and in consideration of the sum
of One and no/100 DOLLARS, and other good and valuable considerations, in hand paid by T.
H. Richardson of St. Paul, Minnesota . . . hereinafter called assignee, . . . do hereby sell, assign,
transfer, convey, and set over unto the said assignee, all of our right, title and interest in and
to six and one-fourth per cent (6¼%) Royalty, of all the oil and of all the gas produced and
saved from the hereinafter described lands, located in the County of Williams, State of
North Dakota, to-wit:Southeast Quarter of Northeast Quarter (SE1/4NE1/4), Lot One (1),
South Half of Southwest Quarter (S1/2SW1/4) and Southeast Quarter (SE1/4) of Section Three
(3) in Township One Hundred Fifty-Five (155) of Range One Hundred (100)and embracing
320 acres, more or less, according to the Government official survey thereof: . . . .
 (Emphasis added.)[¶10] Neither party
argues the assignment is ambiguous. The Robinsons argue that the use of the word "our" in the
1942 assignment executed by the Metzgers created a 6.25 percent royalty burden on only the
interest actually owned by the Metzgers. The Robinsons argue the district court failed to
recognize that "our" in the 1942 assignment referred only to the Metzgers' interest in the tract,
contending the assignment's use of "our" was proof summary judgment should have been granted
in their favor.[¶11] The Robinsons argue the use of "our" in the
1942 assignment of royalty must be given its ordinary meaning in the analysis of the assignment.
They contend the Metzgers intended to limit the mineral interest to their share by describing it as
"our right, title and interest"; such a legal description of only their mineral interest would have
been "impossible" because the Metzgers owned a one-third share of the minerals under the 320
acres described--not the specific minerals associated with a specific patch of the 320 acres; and
the only logical way to limit the transfer of their share would have been designated as a portion
of the Metzgers' right, title, and interest, which the Metzgers did when they used "our" to
describe the "right, title and interest" conveyed, as opposed to describing it as "the right, title and
interest."[¶12] Although THR pointed out the assignment did not
include a "proportionate reduction" clause regarding calculation of the 6.25 percent royalty
assignment, the Robinsons maintain such clause was unnecessary because the Metzgers only
transferred 6.25 percent of their one-third share and not of the whole. They assert any additional
co-ownership interests were of record at the time, giving T.H. Richardson sufficient notice of
what he was actually buying. They maintain the district court's ruling results in a windfall for
T.H. Richardson's successors, giving them a greater share of the royalty from the land than was
the Metzgers' intent.[¶13] THR responds that the Robinsons'
argument does not propose an ordinary meaning for the assignment's use of the word "our." THR
contends their interpretation of "our" is correct for two reasons. First, use of "our" only indicates
possession of something--in this case the royalty owned by the Metzgers--but "our" does not
specify how that interest conveyed is to be calculated. Second, the only way to decide in the
Robinsons' favor would be to ignore the remaining conveyance language, which is not
permissible under N.D.C.C. § 09-07-06. The assignment specifically states the royalty
conveyed is of "all the oil and of all the gas" produced and saved from the described lands. THR
asserts, therefore, the correct interpretation must also give effect to the word "all," to construe the
Metzgers' conveyance as giving T.H. Richardson a 6.25 percent royalty from all of the
oil and gas produced from the lands, meaning the Metzgers conveyed 6.25 percent to Richardson
and reserved 27.083333 percent for themselves. THR contends the Metzgers had sufficient
interest to satisfy the grant since they owned thirty-three and one-third percent of all the royalty
in the described property. THR argues no other intention can be drawn from the
language.[¶14] Put another way, the only question to be resolved
on appeal is whether the 1942 assignment of royalty conveyed 6.25 percent of the Metzgers'
one-third interest in the royalty from the described property or 6.25 percent of the royalty from
the entire property from the Metzgers' one-third interest. On the basis of our review, we agree
with the district court's interpretation of the assignment. Rather than focusing only on the word
"our," reading the plain language of the granting clause also requires interpretation of the phrase
"of all the oil and of all the gas produced and saved from the hereinafter described lands"
immediately following the 6.25 percent royalty. This phrase defines how the 6.25 percent royalty
was to be calculated. We conclude this unambiguously shows the Metzgers' intention that T.H.
Robinson receive a 6.25 percent royalty based on oil and gas produced from the entire tract of
land described. Additionally, use of the words "described lands" also shows the amount conveyed
was to be taken as a percentage of the entire interest.[¶15]
Although the district court held the language of the assignment was unambiguous, construing the
language as a matter of law, we note that the court also entered "findings of fact" in support of its
amended judgment. Generally, "[s]ummary judgment should not be used to conduct mini-trials of
factual issues." Golden, 2013 ND 17, ¶ 18, 826 N.W.2d 610. We have
explained that "[d]eciding an issue on summary judgment is not appropriate if the court must
draw inferences or make findings on disputed facts." Creighton, 2013 ND 73, ¶ 20, 830 N.W.2d 556. "A finding of fact
is reached by natural reasoning, and a conclusion of law is reached by fixed rules of law." Nygaard v. Robinson, 341 N.W.2d 349, 354 (N.D. 1983); see also Creighton, at ¶ 20. "If the facts are undisputed and only
one inference can reasonably be drawn, the determination of that inference is a question of law."
Creighton, at ¶ 20 (citing Nygaard, at 354). "However, when the facts are undisputed and
more than one inference may be drawn, the determination of the inference drawn is a finding of
fact." Id. We have also said a district
court is not required to make findings in a case involving a summary judgment motion under N.D.R.Civ.P. 56. Anderson v. Zimbelman, 2014 ND 34, ¶ 23, 842 N.W.2d 852 (quoting N.D.R.Civ.P. 52(a)(3) ("The court is not required to
state findings or conclusions when ruling on a motion under Rule 12 or 56 or, unless these rules
provide otherwise, on any other motion.")).[¶16] Although the
district court labeled its recitation of facts as "findings of fact," the court was not required to have
made findings for summary judgment. Moreover, the parties' recitation of facts below and on
appeal appear undisputed, except with regard to the interpretation of the 1942 assignment of
royalty. When facts are undisputed and only one inference can reasonably be drawn, the
determination of that inference is a question of law. Creighton, 2013 ND 73, ¶ 20, 830 N.W.2d 556. None of the
parties have argued the assignment is ambiguous, so as to necessitate consideration of extrinsic
evidence in construing the assignment and requiring a trial. Rather, both THR and the Robinsons
contend the assignment is unambiguous and rely on their own interpretations of the assignment
to show the Metzgers' intention in executing the assignment. We therefore conclude the
Robinsons failed to raise a genuine issue of material fact so as to render summary judgment
improper, and the district court did not err in construing the assignment as a matter of law. We
affirm the court's amended judgment.IV[¶17]
We have considered the Robinsons' remaining arguments and conclude they are either
unnecessary to our decision or without merit. The amended judgment is affirmed.[¶18] Lisa Fair
McEversCarol Ronning KapsnerAllan L. Schmalenberger, S.J.Gerald W.
VandeWalle, C.J.I concur in the result. Dale V. Sandstrom, S.J.
[¶19] The Honorable Jerod E. Tufte was
not a member of the Court when this case was heard and did not participate in this decision.
Surrogate Judge Dale V. Sandstrom, sitting.[¶20] The Honorable
Allan L. Schmalenberger, S.J., sitting in place of Crothers, J., disqualified.