Court Opinion

ID: 9572912
Source: CourtListenerOpinion
Date Created: 2023-08-21 20:45:43.180312+00
Date Added: 2024-06-11T12:34:37.910662
License: Public Domain

*97THOMAS, Justice,
specially concurring and dissenting.
I concur in the holdings of the majority opinion with respect to Case No. 5566, which is the appeal by Eugene Stevens. Those holdings are that the determinations by the district court are correct except for its determination that the proceeds from the Penbar Mine project already had been distributed to the partners. I must dissent, however, from the disposition made by the majority opinion with respect to Case No. 5565, the appeal by W. J. Murphy. I have no real quarrel with the recitations made in the majority opinion as to the law with respect to waiver and laches. Recognizing that the district court may have premised his ruling upon an erroneous ground, we still can affirm his judgment upon any proper ground appearing in the record. Agar v. Kysar, Wyo., 628 P.2d 1350 (1981); Wightman v. American National Bank of Riverton, Wyo., 610 P.2d 1001 (1980), and eases therein cited. In my opinion the disposition made by the district court represents a sound sense of propriety and should be affirmed.
With respect to these coal permits, the majority opinion states as follows:
“ * * * Early in 1968, according to both • Murphy’s and Schauss’ testimonies, Stevens suggested that the partnership should acquire some coal prospecting permits. Murphy testified that the three of them had ‘a dozen or so’ conversations about the coal permits. Stevens actually prepared permit applications in each of the partner’s names, together with a coal permit in Nuclear Reserves’ name, so that the partnership could acquire an entire area which would be four times as large as the area for which one individual could apply. * * * ”
This language in the majority opinion describes a scheme to evade the acreage limitations set forth in the Code of Federal Regulations; the regulations relating to qualifications of applicants; and the regulations relating to applications for permits. 43 C.F.R., Ch. II, §§ 3131.1, 3131.2, 3132.-2(a)(1), (2), (5), and (b), and 3133.3 (Jan. 1, 1967 Rev.). It would appear that such permits would be subject to cancellation by the United States of America because of these violations. 43 C.F.R., Ch. II, § 3133.5(c) (Jan. 1, 1967 Rev.); Boesche v. Udall, 373 U.S. 472, 83 S.Ct. 1373, 10 L.Ed.2d 491 (1963). The record discloses the expertise of the parties with respect to the mineral leasing rules and regulations of the United States, and that the scheme of the evasion was purposeful.
I cannot agree with the conclusions in the majority opinion as to the legality of this arrangement. Murphy described the scheme in his testimony and stated that he knew that Stevens had applied for a coal permit in his own name. The admitted purpose of applying in the several names was to avoid the acreage limitations. The majority position has to assume that Stevens’ application was on behalf of the partnership. One applicable requirement of the Code of Federal Regulations reads as follows:
“(a) No specific form is required, but the application should cover the following points:
“(1) The applicant’s name and address.” (Emphasis added.) 43 C.F.R., Ch. II, § 3132.2 (Jan. 1, 1967 Rev.).
If the permit was intended to be partnership property then the regulation required that it be applied for in the name of the partnership, and in other parts it required a disclosure of the partnership. Since it did not do that the application was false.
Another applicable regulation reads as follows:
“(e) Every applicant for lease or permit must submit at the time of filing a signed statement that he is the sole party in interest in the application and the lease or permit, if issued; if not, he shall set forth the names of the other interested parties. If there are other interested parties in the application, a separate or joint statement must be signed by them and by the applicant setting forth the nature and extent of the interest of each in the application, the nature of the agreement between them, if oral, and a *98copy of such agreement if written. Such separate or joint statement of interest and written agreement, if any, or a statement of the nature of such agreement, if oral, must accompany the application. Simultaneously, all interested parties must furnish evidence of their qualifications to hold such lease interest or permit.” 43 C.F.R., Ch. II, § 3131.2(e) (Jan. 1, 1967 Rev.).
In its failure to comply with the requirements of this regulation Stevens’ application also was false.
Still another applicable regulation reads as follows:
“18 U.S.C. 1001 makes it a crime for any person knowingly and wilfully to submit or cause to be submitted to any agency of the United States any false or fraudulent statements as to any matter within its jurisdiction.” 43 C.F.R., Ch. II, § 3001.-0-7 (Jan. 1, 1967 Rev.)
This record discloses by the testimony of the parties not only an agreement to conduct their business unlawfully, but specific illegal acts in an effort to accomplish that purpose.
The parties’ scheme “constituted a conspiracy to defraud the United States of the title to its coal land and any act in furtherance of such conspiracy would constitute a criminal conspiracy and a crime.” Kennedy v. Lonabaugh, 19 Wyo. 352, 117 P. 1079, 1081, Ann.Cas. 1913E, 133 (1911). In Kennedy v. Lonabaugh, supra, this court held that a court of equity has a duty to determine the character of the contract which it is called upon to enforce or the profits of which it is asked to distribute as disclosed by the evidence, even though the illegality or its validity as being in violation of the law is not raised by the pleadings. The court further held that a court of equity will not lend its aid to enforce the performance of a contract which is contrary to public policy or contrary to the law of the land, but will leave the parties in the plight in which their own illegal action has placed them. Summarizing the matter, this court said at 19 Wyo. 376, 117 P. 1087-1088:
“It is a principle which controls courts of equity in the administration of justice that he who seeks their aid must do so with clean hands — that he cannot make his iniquitous act the basis of equitable relief. To decree a division of the profits of this contract would be in substance to enforce an illegal contract. McMullen v. Hoffman, supra [174 U.S. 639, 19 S.Ct. 839, 43 L.Ed. 1117 (1899)]. The lower court properly left the parties where they had placed themselves.”
While the facts are different, Kennedy v. Lonabaugh, supra, cannot conceptually be distinguished from this case. I am unable to discern any policy factors which would justify the different result. A court still should not “allow itself to be used in aid of any of the parties to an illegal agreement.” Williams v. Weber Mesa Ditch Extension Company, Inc., Wyo., 572 P.2d 412, 414 (1977). See also Owens v. Capri, 65 Wyo. 325, 202 P.2d 174 (1949); Claus v. Farmers & Stockgrowers State Bank, 51 Wyo. 45, 63 P.2d 781 (1936); and Hoge v. George, 27 Wyo. 423, 200 P. 96 (1921).
I would, albeit on a different ground, affirm the judgment of the trial court in refusing to grant an accounting for these coal permits.