Court Opinion

ID: 7979484
Source: CourtListenerOpinion
Date Created: 2022-09-09 01:03:45.236145+00
Date Added: 2024-06-11T16:35:00.289713
License: Public Domain

Dibell, J.
A rehearing was granted upon the question whether the construction of the mining lease made in our decision offends the contract or due process of law clauses of the Federal Constitution. We state the claims made as applied to the situation before us and the result which we reach, and engage in no extended discussion.
1. The state mining lease is in fact a lease and not a sale of ore in place. State v. Evans, 99 Minn. 220, 108 N. W. 958, 9 Ann. Cas. 520; Boeing v. Owsley, 122 Minn. 190, 142 N. W. 129; State v. Royal Mineral Assn. 132 Minn. 232, 156 N. W. 128, Ann. Cas. 1918A, 145; Orr v. Bennett, 135 Minn. 443, 161 N. W. 165; Minn. L. & T. Co. v. Douglas, 135 Minn. 413, 161 N. W. 158; State v. Cavour Mining Co., 143 Minn. 271, 173 N. W. 415.
2. In our decision it was held that a state mining lessee may, if he chooses, take from the mine and use low grade ore, rejecting by pick or shovel or other means dirt and rock and other waste material, after the manner of ordinary good mining, paying the stipulated 25 cents a ton royalty on such product, although under present furnace methods it is not usable in the furnaces in the condition in which the lessee tabes it from the mine; but that the lessee is not entitled to take such product *467to the washer, subject it to treatment or “beneficiation,” and pay 25 cents per ton on the reduced tonnage of concentrates directly usable in the furnaces.
The defendant’s contention is that our holding changes the nature of the mining lease from a lease in fact to a sale of ore in place. Such is not our view. Our holding was consistent with the theory of the state mining lease which we have maintained from the beginning. The holding that the lessee must pay the stipulated royalty upon-.the ore which he takes on the basis of tonnage before treatment, was not a holding that the lease is a sale of ore in place. It was an interpretation of the meaning of the lease as to the basis upon which royalty was to be paid. Our holding, stated in another way, was that the lease meant by the term “all the iron ore mined and removed,” or “all iron ore so taken out, mined and carried away,” upon which a 25-cents royalty was to be paid, the low grade ore which the lessee under the lease of “merchantable shipping iron ore” chose to take to the washer, and not upon the concentrates resulting from the treatment. This is not a change in the construction of the state lease'. This is the only case ever before the court involving the question of the basis of payment in ease of concentration and this is the first time, as we understand it, that the state’s insistence upon a royalty upon the low grade ore going to the washer has been judicially attacked.
We have examined the eases cited by counsel. It may be noted that there is no legislation which the defendant claims impairs its contract. We see nothing in the claim of want of due process. We hold that our decision, to the effect that the lessee under a mining lease must pay on the tonnage of crude ore which he chooses to take to the washer and may not pay upon the reduced tonnage of concentrates, does not impair the obligation of the contract of lease nor offend the due process of law provision of the Federal Constitution. Upon this the court is agreed.
The judgment will stand reversed.