Court Opinion

ID: 878521
Source: CourtListenerOpinion
Date Created: 2013-06-04 22:43:00.30723+00
Date Added: 2024-06-11T13:02:57.665750
License: Public Domain

No. 8 3 - 1 9 6
                  IN THE SUPREME COURT OF THE STATE OF MONTANA

                                         1984

SILVER JET FIIWES , INC. ,
a Mont. corp. ,
                  Plaintiff, Respondent     &   Cross-Appellant,

FRANKLIN SCHWARK,
                  Defendant and Appellant.,

APPEAL FROP4:      District Court of the Fourth Judicial District,
                   In and for the County of Sanders,
                   The Honorable Jack L. Green, Judge presiding.

COUNSEL OF RECORD:

      For Appellant:
                  Garlington, Lohn & Robinson; Paul C. Meismer,
                  Missoula, Montana

      For Respondent      &   Cross-Appellant:

                  Baxter, Fletcher & Hanson; Robert L. Fletcher,
                  Thompson Falls, Montana

                                    Submitted on Briefs:     March 1, 1 9 8 4

Filed:
          MAY 19 1984

            .."
                                    Clerk
Mr. J u s t i c e J o h n Conway H a r r i s o n d e l i v e r e d                t h e Opinion of
the Court.
          T h i s a c t i o n was b r o u g h t by S i l v e r J e t M i n e s ,             Inc.    to

q u i e t t i t l e i n i t s e l f t o f o u r unpatented l o d e mining c l a i m s
in    the    Burns Mining                District          in     Sanders        County,      Montana

which a r e a l s o c l a i m e d by F r a n k l i n Schwark.                     T i t l e to three

o f t h e c l a i m s was f o u n d t o b e i n Schwark and t h e f o u r t h i n

S i l v e r Jet.        Schwark           appeals         as     to     the    claim quieted         to
S i l v e r J e t and S i l v e r J e t c r o s s a p p e a l s a s t o t h e r e m a i n i n g
three.
          Silver Jet             is     the       successor        in    interest       to certain

m i n i n g p r o p e r t i e s o n c e h e l d by t h e Montana S t a n d a r d M i n i n g
Company.         The c l a i m s i n d i s p u t e h e r e a r e a p p r o x i m a t e l y t e n
m i l e s s o u t h w e s t o f Thompson F a l l s ,               Montana i n t h e a r e a o f
Prospect       Creek.             In     the      1 9 3 0 ' s Montana          Standard obtained
p a t e n t s t o t e n claims l y i n g south of P r o s p e c t Creek.                            The
creek r u n s t h r o u g h           t h e bottom of            a v a l l e y and t h e c l a i m s

were     worked        by        means       of        several     tunnels       which       extended
south,       away      from            the     creek        into        the    hillside.            The

unpatented         claims          here           in    dispute         were     not   located       by
Montana S t a n d a r d u n t i l t h e 1 9 5 0 ' s and l i e o n t h e o p p o s i t e

s i d e of t h e v a l l e y , n o r t h o f P r o s p e c t C r e e k .
         Three       of      the        four           claims     in     dispute,        "Bettye,"

" T u c k e r " and "Mary" w e r e o r i g i n a l l y l o c a t e d a s m i l l s i t e s i n
1954,     b u t amended n o t i c e s o f                 l o c a t i o n were    filed      in   1957
changing        them        to    lode        claims.            Also    in     1957   the     fourth
claim,       "Riverside"               was        located.            Discovery        and    corner
location       on R i v e r s i d e          a l l occurred           i n 1957.        Mining work
c o n t i n u e d on t h e p a t e n t e d c l a i m s a n d o n R i v e r s i d e u n t i l 1 9 6 0

a t w h i c h t i m e a l l m i n i n g o p e r a t i o n s b y Montana S t a n d a r d i n
the area ceased.          There was intermittent assessment work
done by Montana Standard, Silver Jet after it obtained the
claims, and several would be locators until approximately
1980, when this dispute arose.
        Schwark is a long time resident of the area and had
noticed rock outcroppings in the area during hunting trips.
In    1979 he     inquired   of   the     Bureau    of   Land    Management
concerning the existence of claims north of Prospect Creek,
and    was    informed   there were       none.     In     September      1980,
Schwark and Donald Grimm located several unpatented claims
known as the "Grub Stake" group.                   Six   of    these claims
overlapped with the four unpatented Silver Jet claims.                      In
the summer of 1981, Schwark began extracting ore samples
from his unpatented claims.               Remos Killian, president of
Silver Jet, observed Schwark               and    notified him       of    the
conflict.      Discussions as to ownership ensued, and a short
time later Silver Jet filed this action to quiet title in
itself to the four claims.
        The complaint was filed on October 2, 1981, requesting
that Schwark be enjoined from entering onto Silver Jet's
mining claims and that title to the claims be quieted to
Silver Jet.      An order to show cause was issued on October 6,
1981 and a hearing on Silver Jet's request for an injunction
was held on October 27.           After the hearing, both parties
were restrained from performing assessment work, removing
minerals or otherwise disturbing the ground on the disputed
area of the claims.        On February 23, 1982, Schwark filed his
answer and asserted a counter claim for damages resulting
from    the    forced    cessation   of    his    mining      activity.      A
non-jury trial before Judge Jack L. Green was held in August
of     1982,    a t which          both           parties     presented         evidence         on    the

v a l i d i t y of    t h e claims,               reserving       t h e q u e s t i o n of     damages.

Findings        of     fact,       conclusions              of    law     and       the    order      were

entered        on    February           8,        1983.      Schwark       was        found     to    have

title     to    the       conflicting parts                  of    the     Bettye,         Tucker      and

Mary     claims,          because       of        i n v a l i d d i s c o v e r y by S i l v e r J e t ' s

p r e d e c e s s o r Montana S t a n d a r d .           However, S i l v e r J e t was f o u n d

t o h a v e good t i t l e t o t h e R i v e r s i d e c l a i m .                  Schwark a p p e a l s

from t h i s f i n d i n g ,       and S i l v e r J e t a p p e a l s from t h e f i n d i n g

c o n c e r n i n g t h e B e t t y e , T u c k e r and Mary claims.

         W f i r s t d i s c u s s t h e i s s u e s r a i s e d o n d i r e c t a p p e a l by
          e

Schwark,        concerning           the          Riverside       claim.            Schwark a l l e g e s

two    defects         in    Silver          Jet's        work    on     the    c l a i m which,         he

argues,        result         in    a        forfeiture.             First       he       attacks      the

s u f f i c i e n c y o f t h e d i s c o v e r y by S i l v e r J e t ' s p r e d e c e s s o r i n

interest,           and     second           he     attacks       the     sufficiency            of    the

a n n u a l a s s e s s m e n t work d o n e by S i l v e r J e t .

         A     condition precedent                     t o a v a l i d mining             location       is

the,    "[Alctual discovery of a vein, lode o r ledge of rock i n

place bearing a valuable mineral deposit."                                          Anaconda Co. v .

Whittaker           (Mont.     1 9 8 0 ) , 610 P.2d              1177 a t 1179,            37 S t . R e p .

9 0 2 a t 9 0 4 , c i t i n g Upton v. L a r k i n ( 1 8 8 5 ) , 5 Mont.                      6 0 0 , 6 P.

66.      When a s u b s e q u e n t l o c a t o r q u e s t i o n s t h e e x i s t e n c e o f

such a d i s c o v e r y , i t i s incumbent on t h e o r i g i n a l l o c a t o r t o

prove     that       he     has    discovered              sufficient minerals                  as w i l l

meet     the    " p r u d e n t man"          test.          B o s c a r i n o v.     Gibson      (Mont.

1 9 8 3 ) , 6 7 2 P.2d       1 1 1 9 , 40 S t . R e p .      1931.       The p r u d e n t man r u l e

h a s been s t a t e d as,

                    "Where m i n e r a l s h a v e b e e n f o u n d and t h e
                    e v i d e n c e is of such a c h a r a c t e r t h a t a
                    p e r s o n o f o r d i n a r y p r u d e n c e would b e
                    j u s t i f i e d i n the further expenditure of
                  h i s l a b o r and means, w i t h a r e a s o n a b l e
                  p r o s p e c t of s u c c e s s , i n developing a
                  v a l u a b l e mine, t h e r e q u i r e m e n t s of t h e
                  s t a t u t e have been m e t . "             Chrisman v.
                  M i l l e r ( 1 9 0 5 ) , 1 9 7 U . S . 3 1 3 , 322-23, 25
                  S.Ct. 468, 470-71, 49 L.Ed 7 7 0 , 773-74.
          There         is     no     requirement                tha,t     ore        be        found     in

sufficient             quantity             to     support         a      profitable               mining
o p e r a t i o n , n o r i s it r e q u i r e d t h a t a n y s p e c i f i c q u a n t i t y o f

o r e be found.            I n t h e e n d , t h e s u f f i c i e n c y o f d i s c o v e r y is a
q u e s t i o n o f f a c t t o be d e c i d e d below.                Boscarino, supra.

          The t r i a l c o u r t h e r e f o u n d t h e r e had b e e n a s u f f i c i e n t
discovery         of       minerals          on    the     claim       and      we        agree.         The

c e r t i f i c a t e of     location          f i l e d by t h e o r i g i n a l l o c a t o r s i n
1957 is prima              f a c i e evidence of             the existence of                     a valid
discovery.              Section            82-2-102(2),           Thomas        v.        South     Butte
M i n i n g Co.     (9th Cir.             1 9 1 4 ) , 2 1 1 F.     105; motion denied,                    34

S.Ct.      999,        234     U.S.         754,     58    L.Ed.         1578.            Prima        facie
evidence        will         stand        unless     contradicted               and       overcome        by

other     evidence.            S e c t i o n 26-1-102(6),                MCA.         I n t h i s case,

t h e p r i m a f a c i e e v i d e n c e was n o t c o n t r a d i c t e d o r o v e r c o m e b y
any     other       evidence          presented.                Though       the          two    men    who
o r i g i n a l l y l o c a t e d t h e c l a i m f o r Montana S t a n d a r d a r e now

deceased,         the      wife      of     one of        the     locators testified                    that
t h e r e was a v e i n s h o w i n g i n a s h a f t o n t h e c l a i m and t h a t

m i n e r a l s had i n f a c t b e e n e x t r a c t e d .             As the discussion i n

Boscarino         shows,       the        burden      of    proving          discovery             is    not
high.      The q u e s t i o n o f how much o r e i s s u f f i c i e n t t o s u s t a i n
a d i s c o v e r y is p r o p e r l y l e f t t o t h e t r i a l c o u r t ,                    and    its
d e c i s i o n will n o t b e o v e r t u r n e d i f s u p p o r t e d by s u b s t a n t i a l
evidence.         Boscarino, supra.                   Such e v i d e n c e e x i s t e d h e r e .
          Schwark          next      attacks        the    sufficiency               of     the    annual
a s s e s s m e n t work p e r f o r m e d o n b e h a l f         of     S i l v e r Jet.          Since
Schwark did not locate his claim until September of 1980, we
only need scrutinize the assessment work of 1980, as the
assessment work for prior years in inconsequential.               If the
1980 work     is sufficient, Silver Jet has a valid               claim.
Thornton v. Kaufman (1910), 40 Mont. 282, 106 P.2d 361.                  If
the 1980 work      is insufficient, even sufficient work from
prior years could not save Silver Jet's claim, presuming a
valid    subsequent location by Schwark.           30 U.S.C.      28 and
Public Service Co. of Oklahoma v. Bleak              (Ariz 1982), 656
P.2d 600.      It should also be noted that although Schwark's
location was done        in the calendar year          1980, the prior
annual assessment period        ended on August 30, 1980.               For
Schwark's location to be valid, Silver Jet's assessment work
for   the period    of   time beginning      September 1, 1979 and
ending August 30, 1980 must be invalid.              See 30 U.S.C.       28
and   Consolidated Tungsten      Mines,    Inc.   v.    Frazier    (Ariz.
1960), 348 P.2d 734.
        The   assessment work    claimed     to have     been done by
Silver Jet consisted of securing the entrance to "tunnel #3"
to prevent unauthorized entry, clearing growth on the path
to the tunnel, and clearing approximately 6000 square yards
of ground.      This work was done on Silver Jet's patented
claims, but it claimed attribution to the unpatented claims
under Section 82-2-103(2), MCA.      Schwark alleges two defects
here as well; first, that the work claimed is not proper
annual   assessment work,     and   second    that     it may     not    be
attributed from the patented to the unpatented claim.
        Generally, assessment work must tend to develop the
claim and     facilitate the extraction of ore therefrom.
Golden Giant Mining Co. v. Hill (N.M. 1921), 198 P. 276.
Whether       or     not      t h e work           d o n e meets        this     requirement                is a

q u e s t i o n o f f a c t , b u t c o u r t s s h o u l d n o t s u b s t i t u t e t h e i r own

judgment        as      to     the        wisdom          and     expediency          of        the    method

employed        for     developing                 t h e mine        i n place       of     t h a t of        the

owner.        Mann v .        Budlong             (Cal.     1 9 0 0 ) , 6 2 P.       120.        The t r i a l

court's         finding            that           assessment           work    is     sufficient               to

p r e v e n t a n u n p a t e n t e d claim from b e i n g opened f o r r e l o c a t i o n

will     n o t b e d i s t u r b e d on a p p e a l u n l e s s c l e a r l y a g a i n s t t h e

preponderance            of        the       evidence.            New M e r c u r     Mining           Co.     v.

S o u t h Mercur        Mining           Co.        (Utah 1942),            1 2 8 P.2d          269,     cert.
den. 63 S.Ct.           1 1 6 2 , 3 1 9 U.S.              7 5 3 , 8 7 L.Ed.      1707.

          The      trial       court          found        that      t h e work      claimed           in     the

1380     affidavit            of        annual       assessment          was     valid          assessment

work,      and w e a g r e e .               T h e r e was e v i d e n c e e l i c i t e d a t t r i a l

w h i c h showed t h a t t h e c l e a r i n g c o u l d and would                              be used        as
the     needed        base         of     operations             for    mining        the       unpatented

claims.         T h e r e was a l s o e v i d e n c e t h a t t h e u n p a t e n t e d claims

c o u l d be mined from t u n n e l # 3 .                       Thus t h e work d o n e on t h e s e

directly        facilitate               the       development           of    the     mine           and     the

extraction         of      ore.              It    h a s been        held     that    r o a d work            and

r e p a i r work d o n e o n r o a d s t o m i n i n g c l a i m s b o t h c o n s t i t u t e

valid      a s s e s s m e n t work,              and     t h e work     claimed          here        is m o r e

closely related               t o development of                     t h e mine      than either of

those.          Pinkerton               v.        Moore      (N.M.      1959),        340       P.2d         844.

Schwark a l l e g e s t h a t t h i s same work h a s b e e n d o n e r e p e a t e d l y

i n t h e p a s t , and t h i s s h o u l d l e a d t o t h e c o n c l u s i o n t h a t t h e

a s s e s s m e n t w o r k c l a i m e d f o r 1 9 8 0 was i n s u f f i c i e n t .             However,

as     noted         before,              what          happened            prior         t o     1980         is

i n c o n s e q u e n t i a l as Schwark d i d n o t a t t e m p t t o l o c a t e u n t i l

t h a t year.         The t r i a l           judge        c o r r e c t l y r u l e d t h a t t h i s was
v a l i d a s s e s s m e n t work.
          Schwark n e x t c o n t e n d s t h a t t h i s work was p e r f o r m e d on
the     patented          claims       and        may     not       be    attributed            to     the
unpatented claim.                A s s e s s m e n t work n o t d o n e on a p a r t i c u l a r

claim      or     group of          c l a i m s may       only      be        attributed         to    the
c l a i m ( s ) i f it is done,
                   "[Flor the purpose of developing t h e
                   c l a i m s and t o f a c i l i t a t e t h e e x t r a c t i o n
                   of o r e therefrom              . . . I n such c a s e t h e
                   work o r e x p e n d i t u r e m u s t b e f o r t h e
                   purpose of developing a l l t h e c l a i m s .                        ..
                   I f t h e work i s n o t a p a r t o f a g e n e r a l
                   p l a n having i n view t h e development o f
                   the group or consolidated claim, s o t h a t
                   t h e o r e may b e more r e a d i l y e x t r a c t e d ,
                   and t h e work h a s no r e a s o n a b l e a d a p t a t i o n
                   t o t h a t e n d , t h e n no m a t t e r what t h e
                   amount of i t i s , i t c a n n o t b e s a i d t o
                   have been done i n t h e development of t h e
                   group."           Copper Mountain Mining and
                   S m e l t i n g v. B u t t e and C o r b i n C o n s o l i d a t e d
                   Copper and S i l v e r M i n i n g Co. ( 1 9 0 9 ) , 39
                   Mont. 487 a t 492-3, 1 0 4 P.540 a t 541-2.

         The       burden      of     proving           such    a    benefit        to     the    other
c l a i m s i s on t h e o n e s e e k i n g a t t r i b u t i o n .            Copper M o u n t a i n ,
supra.          The t r i a l c o u r t f o u n d t h a t S i l v e r J e t h a d m e t t h i s
burden,       and a g a i n w e a g r e e .             A s noted        above,      a l l t h e 1980

assessment            work     was     done        off     of       the       Riverside          claim.
However t h e e v i d e n c e showed t h a t t h e c l e a r i n g i s t h e c l o s e s t

flat      area       to    the      unpatented             claims,            and    it    would       be
n e c e s s a r y t o b a s e a n y m i n i n g o p e r a t i o n on R i v e r s i d e i n t h a t
area.         There       is    also     evidence          that      the       dike       of    mineral
evident         on t h e R i v e r s i d e    claim spans t h e valley                         onto    the

patented         claims,       where         it    is    tapped          by    tunnel      83.        The
R i v e r s i d e c l a i m c o u l d b e mined            through tunnel                #3.         Remos
Killian,         p a s t p r e s i d e n t of S i l v e r J e t ,         testified        that this
was     the      company's          plan;     to    base        their         operation          on    the
p a t e n t e d c l a i m s and b r a n c h o u t o n t o t h e u n p a t e n t e d c l a i m s .
Although        there       was      testimony        that       this       would       be     quite

expensive,          there      has     never      been     a        requirement         that     the
easiest       or     most      efficient        method         of    mining        a    claim     be
employed.           C o u r t s c a n n o t s u b s t i t u t e t h e i r judgment        for the
miner's.           Mann,     supra.        The e v i d e n c e       showed how t h e work

would     aid      their     plan     and b e n e f i t    the Riverside unpatented
claim.        The t r i a l c o u r t c o r r e c t l y r u l e d       that       it    c o u l d be

a t t r i b u t e d from t h e p a t e n t e d c l a i m s t o t h e R i v e r s i d e c l a i m .
         On c r o s s a p p e a l , S i l v e r J e t c o n t e s t s t h e t r i a l c o u r t ' s

a c t i o n q u i e t i n g t i t l e t o t h e o v e r l a p p o r t i o n s o f t h e Mary,
B e t t y e and T u c k e r u n p a t e n t e d c l a i m s t o Schwark.               Silver Jet
c o n t e n d s t h a t t h e c o u r t a p p l i e d an i n c o r r e c t r u l e o f l a w t o
require       forfeiture.            It    is t h e i r p o s i t i o n      that       the   court

applied          the       "marketability"                test        to     Silver           Jet's

predecessor's              location          which        would        be     an        incorrect

application          of    the     law    as    between        rival        claimants.          See
B o s c a r i n o v . G i b s o n (Mont. 1 9 8 3 ) , 6 7 2 P.2d            1119, 40 St.Rep.

1931.      However, t h e t r i a l c o u r t s p e c i f i c a l l y f o u n d t h a t :
                   " P l a i n t i f f was u n a b l e t o p r o v e t h a t t h e y
                   o r t h e i r p r e d e c e s s o r s had l o c a t e d a
                   v a l u a b l e m i n e r a l d e p o s i t on a n y o f t h e
                   unpatented              claims except Riverside.
                   Failure t o e s t a b l i s h a prima f a c i e
                   showing of v a l u a b l e m i n e r a l d e p o s i t s
                   renders the P l a i n t i f f ' s i n t e r e s t i n the
                   B e t t y e , T u c k e r and Mary u n p a t e n t e d c l a i m s
                   invalid. "

         Based on t h e a b o v e f i n d i n g t h e c o u r t r u l e d t h a t :

                   "Plaintiff's interests i n the Bettye,
                   T u c k e r and Mary u n p a t e n t e d l o d e c l a i m s
                   a r e deemed f o r f e i t e d b e c a u s e o f t h e
                   P l a i n t i f f and i t s p r e d e c e s s o r s ' f a i l u r e
                   t o s u b s t a n t i a l l y comply w i t h s t a t e a n d
                   f e d e r a l mining law intended t o develop
                   m i n e r a l d e p o s i t s on t h e p u b l i c domain."
         Contrary t o S i l v e r Jet's a s s e r t i o n s ,               the t r i a l court
based     i t s d e c i s i o n s on t h e f a i l u r e t o l o c a t e - m i n e r a l s ,
                                                                         any
not   a     failure        to    locate       a    marketable          amount.          This

conclusion is borne o u t by an examination of t h e testimony
at trial.          Of   t h e w i t n e s s e s who were acquainted w i t h t h e

workings i n the a r e a a t t h e time t h e s e claims were l o c a t e d ,
none t e s t i f i e d t o any m i n e r a l s being found on t h e s e t h r e e
claims or any mining work being done on them.                               The evidence
showed      that    the     Riverside        claim     was     the    only     unpatented

claim ever worked.              T h u s t h e t r i a l c o u r t p r o p e r l y found t h a t

t h e r e had been        no v a l i d   l o c a t i o n on t h e Mary,       Bettye      and

Tucker, and Schwark was f r e e t o l o c a t e on t h a t p r o p e r t y .
          A £ firmed.

W concur:
 e