Demers v. Roncor, Inc.

814 P.2d 999, 249 Mont. 176, 48 State Rptr. 629, 1991 Mont. LEXIS 177
CourtMontana Supreme Court
DecidedJuly 2, 1991
Docket90-527
StatusPublished
Cited by12 cases

This text of 814 P.2d 999 (Demers v. Roncor, Inc.) is published on Counsel Stack Legal Research, covering Montana Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Demers v. Roncor, Inc., 814 P.2d 999, 249 Mont. 176, 48 State Rptr. 629, 1991 Mont. LEXIS 177 (Mo. 1991).

Opinions

JUSTICE GRAY

delivered the Opinion of the Court.

The appellants, owners of lots in a subdivision known as Sapphire Village, appeal from the Opinion and Order of the District Court of the Tenth Judicial District, Judith Basin County, granting the respondent’s motion to dismiss. We affirm.

The appellants raise three issues on appeal:

1. Whether the respondent is judicially estopped from barring the appellants access to hand mine on respondent’s sapphire mining claims.

2. Whether the issues in a prior federal court case were identical to the issues raised in the case at bar, such that this litigation is barred by res judicata.

3. Whether the interests of justice allow res judicata to be applied under the circumstances of this case.

The appellants are lot owners in Sapphire Village, a subdivision outside Utica, Montana. The respondent, a California corporation, is the owner of the ‘Yogo Sapphire” bearing dike west of Sapphire Village. The ‘Yogo Dike” is a geological formation containing deposits of sapphire-bearing ore. Sometime in 1968, the respondent’s predecessor in interest, Sapphire Village, Inc., subdivided the real property it owned adjacent to the Yogo Dike into lots ranging from 10,000 square feet to approximately one-third of an acre. The appellants purchased these lots during the 1969 through 1981 time period from Sapphire Village, Inc. or its successor in interest, Roncor, Inc., the respondent herein.

Prior to the sale of the lots, Sapphire Village, Inc., filed a public ‘Declaration of Restrictive Covenants, Reservations, Restrictions, and Grant of Mining Permit” and recorded the same in Judith Basin County, Montana. The Declaration stated that the covenants were to run with the land; the appellants purchased their respective lots subject to these covenants. The Grant of Mining Permit provided that each of the lot owners had the right to “hand dig” for sapphires in designated areas on five specified patented lode mining claims on the Yogo Dike. These five claims were all located in Section 23.

On April 1,1980, Sapphire Village, Inc., which had since merged into the corporate entity of Sapphire International Corporation,1 conveyed [179]*179its interest in the tinning claims it owned on the Yogo Dike to a Colorado company known as Intergem. Commencing in 1982, Inter-gem engaged in extensive mining activities which included strip mining of the five mining claims that were the subject of the Grant of Mining Permit.

In August, 1988, the appellants brought a class action suit for damages, contending that Roncor had breached the terms of the Declaration and Grant of Mining Permit when it conveyed to Inter-gem the right to commercially mine the Yogo Dike. The suit was tried to a jury in February, 1990, in federal district court. The major issue presented was whether or not Roncor had breached the terms of the Declaration and Grant of Mining Permit. The appellants contended that the Grant of Mining Permit gave them an exclusive right to mine. Roncor, however, maintained that the appellants held only a non-exclusive right to mine and that there existed an independent right to commercially mine the claims which was expressly reserved to Sapphire Village, Inc. and its successors in interest. The jury returned a verdict in favor of the appellants and awarded damages for the loss of the mining rights. Judgment was entered accordingly.

During that trial, Ronald Kunisaki, president of Roncor, gave certain testimony that the appellants contend produced a new cause of action. The appellants filed their complaint in this matter on June 8, 1990, seeking damages for interference with certain hand digging mining rights and an injunction to prevent future interference with these rights. The District Court issued its Opinion and Order on August 23, 1990, in which it granted the respondent’s motion to dismiss the complaint. The District Court held that the appellants had already been awarded damages for the “total defeat” of their digging rights and that this action was barred by res judicata. The appellants appeal.

The first issue raised by the appellants on appeal is whether the respondent is judicially estopped from barring access by the appellants to hand mine on the respondent’s mining claims.

During the prior federal trial between these parties, Ronald Kunisaki testified that, although the covenant attached to the five claims located in Section 23, it was his view that Roncor could in its discretion designate other areas as substitutions for the Section 23 claims. A portion of his testimony was as follows:

“Q: [By Mr. Harrison] ... Have you transferred any permanent rights to hand diggers to dig anywhere except in Section 23?
“A: [By Mr. Kunisaki] Yes, by virtue of the covenants.
[180]*180“Q: And can you tell me from the covenants, then, and from your testimony, where that permanent right allows them to dig?
“A: The covenants, as I interpret them, give them the permanent right to hand dig on designated areas, so they do have a permanent right to dig on those designated areas.
“Q: And the, your interpretation of that is that you can tell them anywhere within the mine?
“A: Correct.”

The appellants contend that this testimony demonstrates that the respondent’s position during the federal trial was that the appellants’ hand mining rights were permanent and mine-wide. They argue that, under the principle of judicial estoppel, the respondent is now prevented from treating the appellants’ mining rights as anything but permanent and mine-wide.

Following the close of the federal trial, the respondent advised all members of the plaintiff class by letter that any mining rights they had previously owned by way of the Grant of Mining Permit were canceled and had reverted to Roncor, Inc. The appellants argue that the respondent is judicially estopped from changing its position held at trial and cannot now cancel the appellants’ mine-wide mining rights. The only mining rights they should lose, the appellants argue, are the five claims in Section 23.

Judicial estoppel is generally defined as the ride that a party is bound by his or her judicial declarations and may not contradict them in a subsequent action or proceeding. 28 Am.Jur.2d., Estoppel and Waiver, § 71, pgs. 700-701, (1966). The elements required to support judicial estoppel are as follows: (1) The party being estopped must have knowledge of the facts at the time the original position is taken; (2) the party must have succeeded in maintaining the original position; (3) the position presently taken must be actually inconsistent with the original position; and (4) the original position must have misled the adverse party so that allowing the estopped party to change its position would injuriously affect the adverse party. Colwell v. City of Great Falls (1945), 117 Mont. 126, 157 P.2d 1013 (overruled on other grounds). The rule of judicial estoppel does not apply to a change of position regarding matters of law, nor does it apply where the knowledge or means of knowledge of both parties is equal. Colwell, 117 Mont. at 139, 157 P.2d at 1019.

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Demers v. Roncor, Inc.
814 P.2d 999 (Montana Supreme Court, 1991)

Cite This Page — Counsel Stack

Bluebook (online)
814 P.2d 999, 249 Mont. 176, 48 State Rptr. 629, 1991 Mont. LEXIS 177, Counsel Stack Legal Research, https://law.counselstack.com/opinion/demers-v-roncor-inc-mont-1991.