PARDON ME, IS THAT YOUR DINOSAUR?

Our friend Robert H. Thomas brought our attention into an interesting case in his excellent blog, inversecondemnation.com.  The case, Murray v BEJ Minerals, LLC, was handed down by the Ninth Circuit Court of Appeals on November 6, 2018.

The case was brought by plaintiffs who were owners of a Montana ranch.  They sought a declaratory judgment that dinosaur fossils found on the ranch belong to them as owners of the surface estate.

Plaintiffs took title to the ranch from the Seversons prior to the discovery of the fossils.  The previous owners conveyed the surface and one-third of the mineral estate.  Grantors reserved the remaining two-thirds of the mineral estate.  An amateur paleontologist uncovered the well-preserved fossils, a 22-foot-long Theropod and a 28-foot-long Ceratopsian.  Other fossils were found including a nearly intact Tyrannosaurus Rex.  The fossils are quite rare and valuable.  They were appraised at between seven million and nine million dollars.

The District Court found that the fossils are not included in the ordinary and natural meaning of “mineral” under Montana Law and, therefore, are not part of the mineral estate.

The Appeals Court disagreed and held that the Montana Fossils fit within the definitions of the word “mineral” that focus on a substance’s chemical composition.  Although the Montana Fossils clearly fall within dictionary definitions of the word “mineral,” their analysis did not end there.  The Court stated that the deed must be interpreted under Montana Law.  Under the Law, fossils are “minerals” pursuant to the terms of the deed and belong to the owners of the mineral estate.

The case reminded me of a New York case dealing with a Mastodon.  I remembered the case, but not its name.  It took a while, but I found it.  The case arose when land was appropriated for highway construction.  While excavating the property, the State unearthed the skeletal remains of a Mastodon.  The owner demanded the return of the fossils and the State refused.  In the Court of Claims, the State argued that any money due claimant was included in a prior decision on the appropriation claim filed by the claimant.  It turns out that the State jumped the gun and began construction prior to the filing of the appropriation map.  At the trial of the earlier appropriation claim, the Court determined there was a de facto taking and awarded damages.  The State contended that by reason of the de facto appropriation which was on the date the bones were unearthed, the State had title to the fossil skeleton.

But the Court of Claims did not agree.  It held that the earlier date of entry becomes the date on which the property’s value is determined.  However, the subsequent filing of the map in the County Clerk’s Office vested title on the State and the appropriation was then complete.  The Court also stated that the fossil was not of the same nature as a mineral asset discovered upon or within the lands of another and did not enhance the raw acreage value of the property.  Rather, it was property of a personal nature buried in the lands of the claimant which was owned when the prehistoric animal was found.  Therefore, the State converted the Mastodon.  Hunterfly Realty Corp. v State of New York, 74 Misc2d 345 (Ct. Cls. 1973).

Posted in De Facto Appropriation, Fossils, Mineral Rights
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