IN THE SUPREME COURT OF THE STATE OF MONTANA 

1981 

WESTERN ENERGY COMPANY, 

Plaintiff and Respondent, 

BURLINGTON NORTHERN INC., 

Plaintiff-Intervenor and Respondent, 

GENIE LAND COMPANY, 

Defendant and Appellant. 

Appeal from: District Court of the Sixteenth Judicial District, 

In and for the County of Rosebud 

Honorable Arthur B. Martin, Judge presiding. 

Counsel of Record: 

For Appellant: 

Patten and Renz, Billings, Montana 

James A. Patten argued, Billings, Montana 

For Respondent : 

Moulton, Bellingham, Longo & Mather, Billings, Montana 

William Bellingham argued, Billings, Montana 

R. Blair Strong, Butte, Montana 

For Intervenor: 

Gary H. Peterson, Billings, Montana 

Submitted: September 18, 1981 

Decided: November 5, 1981 

Filed: #n\l 5 - jm 
Mr. Justice John C. Sheehy delivered the Opinion of the 

Court. 

Genie Land Company appeals from a judgment in the 

District Court, Sixteenth District, Rosebud County, in favor 

of Western Energy Company and Burlington Northern, Inc., 

declaring the rights of the parties under mineral reservations 

contained in warranty deeds, and permanently enjoining Genie 

Land from interfering with Western Energy's activities in 

procuring a resource inventory of the lands involved. Genie 

Land also appeals from the denial of a trial by jury by the 

District Court. 

Genie Land is the present owner of, and successor in 

interest to the surface of lands purchased in 1945 and 1947 

from Northern Pacific Railway, predecessor in interest to 

Burlington Northern. The deeds are subject to the following 

mineral reservation: 

"excepting and reserving unto the grantor, its 

successors and assigns, forever, all minerals 

of any nature whatsoever, including coal, iron, 

natural gas and oil, upon or in said land, together 

with the use of such of the surface as may be 

necessary for exploring for and mining or otherwise 

extracting and carrying away the same; but the grantor, 

its successors and assigns, shall pay to the grantee 

or to its successors or assigns, the market value at 

the time mining operations are commenced of such 

portion of the surface as may be used for such 

operations or injured thereby, including any improvements thereon . . ." 

Western Energy acquired the right to mine the coal 

underlying Genie's surface from the Montana Power Company, 

which had leased the coal from the Northern Pacific Railway 

The District Court action was brought by Western Energy 

to enjoin Genie Land from preventing Western Energy's resource 

inventory operations upon the lands involved and to obtain 

a declaratory judgment adjudicating the respective rights 
and duties of Western Energy and Genie Land under the coal 

lease and mineral reservations involved. Burlington Northern 

joined in the District Court action as a plaintiff intervenor. 

The District Court judgment granted Western Energy's 

request for injunctive relief, allowed Western Energy access 

upon the lands in order to conduct the proposed resource 

inventory operations and ruled that the mineral reservations 

gave the mineral owner and its lessee the right and authority 

to conduct the resource inventory operations. 

The principal issue involved is whether the mineral 

reservation set forth above gives Western Energy the right 

to conduct its resource inventory operations on Genie's 

surface. These operations are data-gathering in nature and 

provide a would-be surface mine operator with the data 

required to be included in its surface mine permit application. 

The resource inventory operations contemplated by Western 

Energy include: (1) soil surveys, (2) vegetation surveys, 

(3) wildlife surveys, (4) hydrological surveys, (5) archeological 

surveys, (6) topographical mapping surveys, (7) air quality 

monitoring, and (8) coal and overburden analysis. 

Genie contends that the resource inventory operations 

will entail tests of origins of the surface, a one year 

study of the wildlife on the surface, a survey of the wells, 

springs and surface water, a review of the surface for any 

archeological sites, placing and physically occupying survey 

monuments thereon, establishing an air quality monitoring 

station which must be attended every three days by Western 

Energy personnel, drilling several wells, and various multiple 

entries onto Genie's surface by Western Energy agents and 

personnel. Western Energy admits the possibility of one 

year's presence on Genie's surface; Genie contends the 

presence on its surface could be up to two years. 

-3- 
Genie concedes that under the mineral reservation, 

Western Energy could enter Genie's surface to drill test 

and core holes to determine coal and ore deposits, and the 

extent thereof. 

Western Energy concedes that the compilation of the 

inventory 

data to be gathered by its proposed resource/operations is 

necessary for inclusion in Western Energy's application for 

a permit to mine the coal under Genie's surface. Our statutes 

and the administrative regulations thereunder, requiring much 

of the data for inclusion in a strip mining permit application, 

were first adopted in 1973. Section 82-4-222, MCA. In 

1975, an additional statutory requirement was adopted that 

when the surface owner is not the owner of the mineral 

estate proposed to be mined by strip mining operations, the 

application for a strip mining permit must include the 

written consent or waiver by the owners of the surface lands 

involved to enter and commence strip mining operations on 

the land, except that this condition does not apply when 

the mineral estate is owned by the federal government in fee 

or in trust for an Indian tribe. Section 82-4-224, MCA. 

The principal point urged by Genie in this appeal is 

that the mineral reservation above does not give Western 

Energy the authority to conduct its resource inventory 

operations on the surface owned by Genie. 

In support of that point, Genie contends that resource 

inventory operations are not included in the plain language 

of the mineral reservation; that the proposed resource 

inventory operation would be burdensome upon the surface 

estate; that the right to "the use of such of the surface as 

may be necessary for exploring for" minerals is limited to 

mean what is necessary to discover ore and its extent; that 
resource inventory operations constitute neither "mining" 

nor "extracting" minerals; that resource inventory operations 

are excluded by the maxim, "the express mention of one thing 

implies the exclusion of another;" and that the need for 

resource inventory operations, established by the Montana 

statutes after the execution of the warranty deeds here in 

question, does not excuse a legal wrong to be suffered by 

Genie. 

It is further contended by Genie that the proposed 

resource inventory operations are not reasonable because 

Western Energy has not obtained, and will never obtain, the 

consent of Genie to conduct strip mining operations, which 

it contends is the key to all mining and premining purposes; 

that exploration is futile because of the lack of consent; 

that here there can be no easement by implication or necessity 

as a reasonable interpretation of the mineral reservations; 

that public policy protects the surface owner as evidenced 

by the adoption of section 82-4-224, MCA, supra; that Western 

Energy does not intend to conduct mining operations on 

Genie's surface at this time; and that resource inventory 

operations were not within the intention of the parties at 

the time of the conveyances containing the mineral reservations. 

Finally, Genie contends that it is entitled to a jury 

trial to resolve fact issues arising out of the mineral 

reservations. 

Western Energy and Burlington Northern respond that 

consent of the surface owner is not an issue at this stage 

of the proceedings since a formal application for a strip 

mining permit has not been made to State authorities; that 

the proposed resource inventory operations constitute a 

reasonable burden upon the surface owners of coal lands; that 

strip mining was conducted at the time of the deeds of 
conveyance here in question; that resource inventory operations 

are a reasonable use of the surface under the mineral 

reservations; that resource inventory operations are necessarily 

implied in the mineral reservations contained in the deeds 

of conveyance; and that the maxim "the express mention of one 

thing implies the exclusion of another" does not apply here. 

Western Energy and Burlington Northern further contend that 

no jury trial is required of the issues relating to the 

right of entry for the purpose of resource inventory operations. 

Our resolution of this controversy is based upon our 

conclusion that the proposed resource inventory operations 

are necessarily implied in the language reserving the minerals, 

including coal, "together with the use of such of the surface 

as may be necessary for exploring for and mining or otherwise 

extracting and carrying away the same . . ." We also conclude 

that strip mining was within the contemplation of the parties 

at the time of the deeds of conveyance containing the mineral 

reservations because at that time Northern Pacific Railway 

Company was conducting coal strip mining operations within 

relatively short distances from the lands there conveyed. 

See, 54 Arn.Jur.2d 389, 390, Mines -- and Minerals, S 210. 

Three cases applying Montana law have established that a 

reasonable use of the surface by the owner of a severed 

mineral estate for the enjoyment of the mineral reservation 

may be implied from the terms of the mineral reservation, 

though not expressly stated therein. In Hurley v. Northern 

Pacific Railway Company (1969), 153 Mont. 199, 455 P.2d 321, 

(reversed on other grounds) this Court affirmed that a 

mineral owner had the right to reasonable use of the surface 

area under mineral reservations similar to the one here 

involved. We quoted from California authority to the effect: 
"So far as duties are concerned in the instant 

case, it is I. . . well-settled that the owner of 

the oil and mineral estate has a right to enter 

upon the surface of the property and make such 

use thereof as is reasonably required for the 

enjoyment of his estate therein . . .' (citing 

Wall v. Shell Oil Company (1962), 209 Cal.App.2d 

504, 25 Cal.Rptr. 908, 911.) 

"'If a particular facility is necessary and convenient to the operations of the oil and mineral 

owner, it may be placed anywhere upon the surface 

area in which he has the right of user, so long 

as such placement is reasonable under prevailing 

conditions and even though such placement in 

particular instances may work a hardship on 

the surface owner.'" 153 Mont. at 202, 455 P.2d 

at 323, citing Wall, -- supra, at 915. 

In Russell v. Texas Company (9th Cir. 1956), 238 F.2d 

636, 644, the court of appeals affirmed a Montana federal 

district court judgment that a mineral reservation similar 

to the one at bar entitled the owner of the mineral rights 

to take from the land and use that amount of water reasonably 

necessary for the exploitation of the mineral rights as an 

incident to the mineral ownership. 

In Northern Cheyenne Tribe v. Hollowbreast (D. Mont. 

1972), 349 F.Supp. 1302, 1310, rev'd on other grounds sub nom. 

Northern Cheyenne Tribe v. Northern Cheyenne, etc., 505 F.2d 

rev'd on other grounds 

268 (9th Cir. 1974),/425 U.S. 649, 96 S.Ct. 1793, 48 L.Ed.2d 

274 (1976), the District Court recognized the right of the 

owner of the mineral estate or its lessee to enter and use 

the surface for exploration, recovery and development of the 

minerals as may be reasonably necessary. 

We find no Montana cases, nor have we been cited to 

any, that contravene these statements relating to the implied 

rights of the owner of a severed mineral estate to the 

reasonable enjoyment of his ownership. This authority 

overcomes Genie's contention that the plain language of the 

reservation must include the right to resource inventory 

operations,or else such rights are limited to the means 
necessary to discover ore and its extent. It is obvious 

from the cases that a mineral reservation carries with it 

implied rights of use of the surface which are not necessarily 

"exploring," "mining," or "extracting," but may be indirectly 

related to those activities. 

We turn therefore to Genie's contention that, in any 

event, the resource inventory operations are not a reasonable 

use of the surface under the implied rights contained in the 

mineral reservation. 

First, we do not find that the lack of Genie's consent 

now, and the probable lack of its consent in the future, to 

any application for a strip mining permit by Western Energy 

is an issue at this time. Under the language of the mineral 

reservations, Genie's consent is not necessary to the right 

of Burlington Northern, as the owner, and Western Energy as 

its lessee, to explore for coal. Indeed, Genie admits that 

Western Energy has the right to enter upon Genie's lands for 

the purpose of drilling test or core holes to determine the 

extent of the coal deposits. The question becomes whether 

it is a reasonable implied right for Western Energy additionally 

to undertake the compilation of the data required under 

regulations for a strip mining permit. 

Admittedly, there has been a broad expansion of regulatory 

demands in connection with the strip mining of coal in 

Montana. The adoption of laws by the legislature to protect 

the environment, and the interests of surface owners in wouldbe or actual strip mining operations, have complicated the 

judicial task of determining mutual rights under mineral 

reservations such as these. Nor has Montana been alone in 

expanding its law and regulations to meet these concerns. 

Federal regulations with respect to federal applications for 
surface mining permits on federal lands require comparable 

information to the Montana regulations. 30 C.F.R. § 779. 

Additionally, the federal regulations with respect to severed 

mineral estates require that the application for a surface 

mining permit on federal lands include a copy of the surface 

owner's consent, or a copy of the document of conveyance 

that expressly granted or reserved the right to extract the 

coal by surface mining methods; or if not expressly granted, 

documentation that under the applicable state law, the 

applicant has legal authority to extract by surface mining. 

30 C.F.R. § 778.15. 

Although strip mining was known at the time of the 

deeds of conveyance here in question, and indeed was taking 

place within a short distance of the lands conveyed, it must 

be conceded on all sides that the development of environmental 

protection laws and regulations relating to strip mining 

have occurred only in the last decade. Does this mean that 

under mineral reservations made in 1945 and 1947, the rights 

of the mineral owners are restricted, as to exploration and 

mining, to such implied rights as were in existence at the 

time of the deeds of conveyance? We think not. We agree 

with the holding in Oakwood Smokeless Coal Corporation v. 

Meadows (Va. 1945), 34 S.E.2d 392, 395, that the owner of a 

severed mineral interest is not limited to such appliances 

and applications as were in existence when the mineral grant 

or reservation was made, but that pace may be kept with the 

progress of society and modern invention. It was certainly 

the understanding of the parties at the time of the deeds 

of conveyance that Northern Pacific Railway Company withheld 

the mineral ownership, and reserved the right to do what 

was necessary to extract the minerals. For us to hold 
otherwise with respect to such implied rights, in the light 

of newer regulatory adoptions would be to put the mineral 

estate beyond the reach of its owner. In justice, that 

cannot be. 

Nor do we find the extent of the burden upon the servient 

estate unreasonable, particularly in view of the language in 

the mineral reservation which assures the surface owners the 

market value, at the commencement of the operations of the 

premises, used for such purposes or injured thereby. It is 

clear that the adoption of the regulations by the state for 

the protection of the environment is a reasonable exercise 

of its police power. The necessity for mine operators to 

meet those requirements in exploring for or extracting 

minerals is accordingly a reasonable use of the surface for 

the purpose of mining operations. 

As to Genie's claim that it was entitled to a jury 

trial in this cause, there are no disputed issues of fact 

that require a jury trial. The issuance of the injunction is 

in any event, an equitable action. Federal Land Bank of 

Spokane v. Myhre (1940), 110 Mont. 416, 422, 101 P.2d 1017, 

1020. Genie is not entitled to a jury trial of any issues 

in this cause. 

We emphasize that we limit this decision to the issues 

directly involved in this case, that is, the right of the 

mineral owner to conduct resource inventory operations as a 

part of the right to explore for minerals under the reservation, 

looking toward eventual compliance with regulations relating 

to a mining permit. 

The judgment of the District Court is affirmed. This 

cause is remanded to the District Court for further proceedings 

with respect to damages and such other issues as are not 
disposed of here. We do not foreclose a jury trial with 

respect to such damages. 

We concu 

// 

,( ,J-d-~4- 

........................... Justices 
Mr. Justice Frank B. Morrison, Jr., dissenting: 

I respectfully dissent from the majority opinion. 

In my opinion this case does not involve interpretation 

of the deed's mineral reservation. No reasonable construction 

could reach a result whereby "resource inventories" are 

included within the language "exploring for" minerals. The 

right to enter to compile resource inventories must exist 

independent of the right to enter for exploration and must 

depend upon and be incidental to a right to mine. The 

majority correctly could imply reservation if there was a 

right to strip-mine. 

The law is clear. The majority correctly notes: "In 

197 5, an additional statutory requirement was adopted that 

when the surface owner is not the owner of the mineral 

estate proposed to be mined by strip-mining operations, the 

application for a strip-mining permit must include the 

written consent or waiver by the owners of the surface lands 

involved to enter and commence strip-mining operations on 

the land, * * *" Genie Land has refused to give permission 

to Western Energy Company to strip-mine. Western Energy 

does not have the right to enter for purposes of stripmining and, therefore, has no incidental right to enter for 

purposes of compiling resource inventories. 

The effect of the majority decision is to say, "although 

you have no deeded right to enter for the purpose of conducting 

resource inventories and although under the law you have no 

right to strip-mine without the owner's consent, we will 

imply a right to enter for resource inventory because resource 

inventories were unknown at the time the deed was executed, 

and since such inventories were unknown, it must have been 
within the contemplation of the parties that, had they been 

known, they would have been included." I cannot understand 

this reasoning process. I can see no basis whatever, either 

in the deed or in law, for the result which the majority 

reaches. 

I would reverse and remand with directions to proceed 

in conformity with this dissent.