No. 79-105 INTHE SUPREME COURT OF THE STATE OF MONTANA 1980

INTHE MATTER OF MONTANA PACIFIC OILAND GAS CO. AND VARIOUS RECORD OWNERS OF OIL AND GAS INTERESTS FOR WHICH MONTANA PACIFIC OIL AND GAS CO. IS HOLDING FUNDS. MONTANA PACIFIC OIL AND GAS CO., Appellant.

Appeal from: DistrictCourt of theNinth JudicialDistrict, In and for the County of Toole. Hon. R. D. McPhillips presiding District Court Judge. Counsel of Record: For Appellant: Aronow, Anderson, Beatty and Lee, Shelby, Montana Richard Munson argued, Shelby, Montana For Amicus Curiae: Hon. Mike Greely, Attorney General, Helena, Montana Dennis Dunphy argued, Assistant Attorney General,

Helena, Montana Ray Kalbfleisch argued, County Attorney, Shelby, Montana

Filed: 

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## 291980 Submitted: May 29, 1980 Decided: July 22, 1980Mr. Justice John C. Sheehy delivered the Opinion of the Court. On December 18, 1979, the Montana Pacific Oil and Gas Co. (MOPOG)petitioned the District Court, Toole County,Ninth District, to obtain orders requiring the clerk of the court, Vivian S. Hall, to receive funds tendered by the petitioner and to establish a trust in the name of the petitioners; to receive future funds;and further that the court decree the petitioner had no duty to search for owners of interest hereafter described, and to require the clerk of the court to hold MOPOG harmless from any future claims of the owners of those property interests. The District Court, on December 18, 1979,denied each request and prayer of MOPOG by its written order of that date. Thereafter,MOPOG petitioned this Court for an order of super-. visory control and after considering that petition,we ordered MOPOG to appeal the order of the District Court in the usual course. Attorney General Mike Greely appeared and filed a brief in this Court as amicus curiae in supprtof the District Court. This appeal arises because of the provisions of Ch. 513, Laws of Montana (1979),which have been recodified as sections 82-1-302, 82-1-303, 82-1-304 and 82-1-305,MCA. Section 6 of said Chapter 513,defining the word "person"has been now codified as section 82-1-301,MCA. MOPOG principally attacks the provisions of section 82-1- 305, on constitutionalgrounds. That section provides as follows: "Existing trust for unlocatable mineral, leasehold, and royalty interest owners -- transfer of trustees 

### -- penalty. (1) Any bonuses, rental payments, royalties, and other income now held by any person or association for unlocatable owners or claimants of an interest in person or association for unlocatable owners or claimants of an interest in minerals underlying 

### a tract of land must be deposited with the clerk of the district court in which the tract is located

### of unlocatable owners ofmineral interest. It is quite evident that the enactment is not a taxing statute. The enactment of a statute for theprotection of private property is a valid exercise of the sovereignpolice power of the state: 

# ".



# . . thepolice power extends

# .. . to the protection of the life, limbs, health, comfort and quiet of all persons, and the protection of all property within the state

# . .

# ." Ruona v. Billings (1958), 136Mont. 554, 558, 323 P.2d 29, 31. MOPOG in asserting its claim of discriminatory classification under its equalprotection argument, states that it belongs to a class of persons holding "unclaimedproperty", that is, money or other tangible or intangible property forwhich no claim has been filed by the reputed owner thereof or for which the holder has no knowledgeof the reputed owner's whereabouts. MOPOG contends that a certain class of persons, oil and gas operators,holding unclaimed royalties,bonuses or other income from oil and gas operationsare a "subclass" subjected to burdens and responsibilities for failure, intentionally or ; 

### unwittingly,to complywith theprovisions of section 82-1-305. Itpoints out that other persons holding unclaimed property in Montana in the form of cash, stock dividends,or security deposits, are subject to the terms of the Uniform Disposition of Unclaimed PropertyAct, sections 70-9-101, et seq., MCA. 

### Under thatAct,MOPOG states the presumption of abandonment arises from the inaction of the owners,not the holders, of the property. The only burden of the holder of thatproperty is to report,under that Act, to the Departmentof Revenue, and to turn over fundswhich are presumptively abandoned. Likewise,MOPOG contends that under the provisions rela,:--- ing to public administrators and escheated estates, the public administrator is directed under statute, section 72-15-102, MCA, to take charge of estates of persons dying with no known heirs or where the estate is ordered into thepublic admin-within 

### 6months after July 1, 1979. An accounting for the funds,any related documents,and any instrument creating a trust must be filed with the funds. "(2) No person may personally hold for longer than 6months any bonuses, rentalpayments, royalties,and other income for unlocatable owners or claimants of an interest in minerals, but in such casemust petition the district court for creation of a trust as provided in 82-1-302. "(3) If any person fails to comply with subsections (1)or (2),he is liable for all attorney fees and court costs and interest on such funds at twice the current average passbook account ratepaid by financial institutions in that district." MOPOG attacks section 82-1-305, MCA, as being unconstitutional under the equal protection and due process clauses of the federal and state constitutions. MOPOG further contends that it was entitled to the declaratory relief sought in the District Court, and that the filing fee charged by the District Court clerk in the matter of $35 was improper. MOPOGtsequal protection argument is,that the statute is not an exercise of police power, but a tax enactment; that taxing statutes are subjected in equal protection cases to

more than minimum scrutinybut less than strict scrutiny to determine constitutionality; and that MOPOG and other oil and gas producers have been singled out in an arbitrary fashion to be subject to the requirements of section 82-1-305,MCA. MOPOG1sargument that section 82-1-305 is a tax statute arises from the provision that the clerk of the District Court, as trustee, is entitled to receive 50percent of the interest earned on trust funds for administrative costs, section 82-1- 304(5), MCA, and because the trust fundsmay eventually be considered abandoned to the state under Title 70,Chapter 9, MCA

# . Theprimary purpose of these statutes,as enacted under Ch. 513, Laws of Montana (1979), is the protection of propertyistrator's hands by a court. MOPOG contends that here the person lawfully holding the unclaimed property has no duty toattempt tofind the owner, but rather the owner orhis heirshave seven years (section26-1-602(26), MCA) within which tocome forward and make a claim. MOPOG fukther contends that section 82-1-305, although presumably having the same goal,

reverses the theory and method applicabletoother holders of unclaimed property inthat oiland gas operatorshave a duty tomake a diligent search for the owner thereof and toestablishtrusts if theowners arenot otherwise located. Is the classification so delineatedby MOPOG unconstitutional under the equal protection clause of either the state

or federal constitutions? Clearly not. In the firstplace, the provisions of Ch. 513, Laws of Montana (1979) apply t o a l lmineral producers, and not only tooiland gas producers. In the second place, the classification can be found proper and rational for itspurposes: theprotection of funds forunlocated property owners forat least the presumptive period of their lives afterthe establishment of thetrust, and the legal releaseof those persons who hold the funds of unlocated owners from further liability if they have complied with the statutescodified under Chapter 513. As the attorney general has pointed out, thisCourt has consistently followed the lead of the United States Supreme Court in interpreting the equalprotection clauses of both the stateand federal constitutions. Both the Fourteenth Amendment of the federal constitution and Art. 11, S4, Mont. Const. 

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. . provide generally equivalent but independent protection in their respective jurisdictions". Emery v. State (19781, Mont

# . , 580 P.2d 445, 35 St.Rep. 709; cert-den. 439 U.S. 874. We find rational support for the classification here in its stated objectives. See, State

### v. Safeway Stores, Inc.(1938),106 Mont. 182, 76 P.2d 81; State v. Johnson (1926), 75 Mont. 240, 243 

### P.% 1073; State 

### v. Loomis (1925)

## , 75 Mont. 88, 242 P. 344; Hill v. Rae (1916),52 Mont. 378, 158 P. 826; City of Butte v. Paltrovich (1904), 30 Mont. 18, 75 P.2d 521. In the matter of classification,the legislature enjoys broad discretion,and the question of classification is primarily

one for the legislature. Safeway Stores, supra, 106 Mont. at 204, 76 P.2d at 86. Even if section 82-1-305, MCA, were considered to be a tax statute, the classificationpower of the legislature is

one of broad discretion. Madden v. Kentucky (1940), 309 U.S. 83, 87-88, 60 S.Ct. 406, 408, 84 L.Ed. 590, 593. We find that the state, through its legislature, has a legitimate interest in establishing a classification for the protection of unlocated owners of interests in minerals or in mineral production and in providing a method for the protection of mineral producers, including oil and gas operators,as a defense against liability from future claims of such unlocated

owners. On that basis, the classification iswell within the power of the state under the equal protection clause of either constitution. The due process argument of MOPOG is that section 82-1- 305, MCA, is so vague and uncertain in its terms as to convey

no meaning and that it is confusing and inconsistentwith other statutes, including section 82-1-302,MCA. MOPOG also attacks the terms "existing trust", "transferof trustees", "unlocatable owners", "tractof land",and "relateddocuments",as being uncertain and incapable of definition under the act. It states that these asserted ambiguities exposeMOPOG to greatpotential liability under section 82-1-305(3), MCA, for attorney fees, court costs and interest at twice the current average passbook account rate. The due process test for vagueness of a statute is whetherthe law is so vague and uncertain that men of common intelligencemust guess at itsmeaning. Cramp v. Bd. of Public Instruction (1961),368 U.S. 278, 82 S.Ct. 275, 7 L.Ed.2d 285; Connally v. General Const. Co. (1926), 269 U.S. 385, 46 S.Ct. 126, 70 L.Ed. 322. We agree with the attorney general that the requirements of the sections are not difficult to ascertain: 1. Any person holding funds payable to persons the holder cannot locate,produced from mineral interests or mineral production, including oil and gas,must turn the funds over to the clerk of the local District Court. A grace period of six months is allowed from the enactment of the statutes. 2. Subsequent to the enactment of the statutes,no holder of the type stated abovemay continue holding payments for the account of unlocatable persons for longer than sixmonths. In turning over the monies to the dlerk of the court as required by the statutes, the holder must petition for a trust as provided for in section 82-1-302,MCA. 3. Civil penalties are provided for failure to comply with the statutes. In addition, the petitioner must allege orprove facts which show that the petitioner has made a diligent but unsuccessful effort to locate the absent owners or claimants. The related documentswould of course be the documents that are "related",--the lease, mineral deed or other instrument which gives the producer the right to produce the minerals, and the producer's records of production and division of proceeds from production should suffice. "Tractof land" would include all parcels described in a single lease,mineral deed, or other instrumentgiving the producer the right to produce minerals. While someminor difficultiesmight arise from the innumerable varieties of situations possible from themineral production business,we are not required by MOPOG's search for ambiguitiesto find such vagueness in the terms used as to destroy the act, when our duty is to construe it so as to be consistent with the will of the legislature and to comport with constitutional limitations. CSC v. Letter Carriers (1973), 413 U.S. 548, 571, 93 S.Ct. 2880, 2893, 37 L.Ed.2d 796, 812. The term "existing trust" is found in the title of the statute,and is an inadvertence which has no importance because it is the body of the act and not its titlewhich controls. Manufacturer's Acceptance Corporation v. Krsul (1968), 151Mont. 28, 35, 438 P.2d 667, 671. The petition filed by MOPOG in the District Court under section 82-1-302,MCA, was clearly deficient. MOPOG1spetition to create a trust failed to allege any effort to locate owners, sought an order declaring that it had no such duty, and sought to establish a lump sum trust for all of themonies held by MOPOG for unlocatable ownerswithout regard to the particular tract of land involved. The District Court had no power to establish a trust as petitioned by MOPOG since itwas outside the applicable statutes. The petition was properly rejected. MOPOG has also proposed nine questions for our review under the act and has asked us to give our determination with respect to those questions. We limit ourselves, however, to the issues growing out of the appealwhich isbefore us, and insofar as the answers to MOPOG1squestions are not found herein, we decline to answer for the reason that it is not the function of the Supreme Court,by way of declaratory judgment, to give opinions on abstract ormoat questions. In this we follow the rule applicable to District Courts. Chovanak v. Matthews (1948), 120Mont. 520, 525-6, 188 P.2d 582, 586. The remaining issue is the amount of fee chargeable by the clerk of the District Court. None of the statuteswith which we are involved in this case set forth the amount of feeto be charged by the District Court clerk. The 

### applicable statutes with respect to fees of the clerk appear in conflict as to the nature of these proceedings and it is therefore a matter of our choice here as t3which fee would be most consistent with the intent of the legislature. Section 25-1-201(1)(a),MCA, provides a fee shall be charged by the clerk of $20 for each "actionorproceeding". 

## cn> Section 25-1-201(1)

## (40, MCA, requires a fee of $35 for probate proceedings, guardianships,or the appointment of a conservator The District Court clerk here apparently determined that the establishment of a trustwas most likely a probate proceeding and therefore charged the $35 fee. Section 27-1-102,MCA, defines the words "actions" and "specialproceedings". An "action is an ordinary proceeding in a court of justice by which one party prosecutes another

. for the enforcement of protection of a right, the redress or prevention of a wrong

# . .

# . Every other remedy is a special proceeding." Under that provision we determine that the requirements of sections 82-1-302 and 82-1-305,MCA, are "special proceedings" and as such the fee of $20would be proper to

assess for each suchproceeding filed. Such a filing fee would apply whether the trustwas established under section 82-1-302 or section 82-1-305,MCA. It seemsobvious from the statutes that if a trust were to be instituted under section 82-1-302, and that subsequently funds subject to deposit were cumulated in the same mineral leasehold where there were unlocatable owners or claimants, subsequent deposits should be deposited in the trust already created under section 82-1- 302,MCA. Affirmed except for the amount of filing fees to becollectedby theclerkof the DistrictCourt upon the institutionof trustsunder these statutes.

WeConcur:

Chief Justice

Justices I

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