United States District Court, D. Montana, Missoula Division
DANA L. CHRISTENSEN, Chief District Judge.
Before the Court are several motions. For the reasons explained the Court denies Plaintiff's motion for summary judgment, grants in part and denies in part Plaintiff's motion for protective order and motion to deem answers admitted, and denies Defendants' motion to require deposit.
Because the parties are familiar with the factual and procedural background of the case, it will only be repeated here as necessary to explain the Court's order.
Montanore Minerals Corporation ("Montanore") brought this diversity action in condemnation pursuant to Rule 71.1 of the Federal Rules of Civil Procedure and Montana Code Annotated § 70-30-101 to condemn easements and rights of way across certain unpatented lode mining claims in which Defendants claim an interest ("Subject Claims"). The Court granted Montanore's motion for a preliminary condemnation order and motion for preliminary injunction on April 29, 2014. To resolve the issue of just compensation, the Court has appointed a three-member Commission and scheduled a Commission hearing for April 8, 2015.
I. Motion for Summary Judgment
A party is entitled to summary judgment if it can demonstrate that "there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(a). Summary judgment is warranted where the documentary evidence produced by the parties permits only one conclusion. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 251 (1986). A party opposing a properly supported motion for summary judgment "may not rest upon mere allegation or denials of his pleading, but must set forth specific facts showing that there is a genuine issue for trial." Id. at 256. Only disputes over facts that might affect the outcome of the lawsuit will preclude entry of summary judgment; factual disputes that are irrelevant or unnecessary to the outcome are not considered. Id. at 248. In ruling on a motion for summary judgment, "[t]he evidence of the non-movant is to be believed, and all justifiable inferences are to be drawn in his favor." Id. at 255.
Montanore moves for summary judgment on the issue of just compensation, requesting the Court to declare as a matter of law that the condemnation of the easements and rights of way through Defendants' unpatented mining claims does not diminish the value of those claims and that the Defendants are not entitled to any compensation. While the Court believes based on the current state of the record that the evidence of diminution in value is minimal, Montana law states that "just compensation is determined by equitable principles." Alexander v. State Highway Comm'n, 412 P.2d 414, 416 (Mont. 1966). Therefore, at this stage of these condemnation proceedings the Court cannot find as a matter of law that Defendants are entitled to nothing for the taking of the easements and rights of way condemned here. Accordingly, the motion for summary judgment is denied, and the issue of just compensation will be resolved by the highly qualified Commission based on all of the evidence presented at the hearing on April 8, 2015.
More specifically, Montanore contends that Defendants have failed to produce expert testimony or evidence on loss in diminution in value of the Subject Claims resulting from the taking, and that absent evidence of the decrease in market value as a result of the taking - in the form of before and after appraisals - it is entitled to summary judgment and Defendants are not entitled to any compensation. Given the scant nature of Defendants' proof, the argument has some appeal, but is ultimately rejected for the reasons explained below.
Defendants do not actually contest Montanore's assertion that they lack evidence in the form of before and after appraisals speaking directly to fair market value of the Subject Claims. Instead, Defendants argue that an appraisal establishing the replacement cost for the Subject Claims should serve as evidence of what constitutes just compensation. While the Court does not reject the general proposition that replacement cost may be used to assess value in Montana condemnation proceedings, see e.g. State Highway Comm'n v. Tubbs, 411 P.2d 739, 743 (Mont. 1966), Defendants' theory for replacement value here must be rejected because it is contrary to the law and the facts.
Defendants' replacement cost theory is premised on the contentions that (1) they have a right of access to the adit, and (2) they own the adit. Both of these contentions are without merit.
Defendants base their claim of access to the adit on two equally meritless arguments: (1) the portal to the adit is on the Subject Claims rather than on Montanore's patented Johnstone Placer claim, and (2) even if the portal is on the Johnstone Placer, Defendants have an implied easement through the Johnstone Placer to access the adit's portal.
Defendants fail to provide evidence sufficient to create a genuine dispute about whether the portal to the adit is on the Johnstone Placer claim. On the other hand, Montanore has provided undisputed sworn testimony from multiple deponents establishing that the portal to the adit is on the Johnstone Placer. Lynn Hagarty, district geologist for the United States Forest Service, testified that "[t]he portal is located on the Johnstone Placer patented mining claim." (Doc. 103-3.) Glen Cash, Sr., a land surveyor, testified that the "improvements" associated with the portal to the adit "lie inside the Johnstone Placer." (Doc. 103-4 at 12.) Glenn Dobbs, the Board chairman and chief executive officer of Mines Management, also testified that "the portal is located on the Johnstone Placer claims." (Doc. 103-5 at 5.) Denver Winslow, Montanore's engineer, testified that his use of the term "portal" refers to "[t]he entrance to the adit on the Johnstone Placer." (Doc. 94-4 at 4.) The only testimony by anyone possibly creating any dispute about this is Defendant Frank Duval's testimony, who in answer to the question of whether the portal to the adit was on the Johnstone Placer, merely responded, "I don't know that." (Doc. 103-6 at 8.) Defendants maintain that "Montanore does not know where exactly the portal' lies in relationship to the boundary of the Johnstone Placer, " and cite the Court to a snippet of Denver Winslow's testimony about the placement of a survey point on the Johnstone Placer. (Doc. 94 at 3.) As noted, Winslow testified unequivocally that the portal to the adit is on the Johnstone Placer and Defendants provide no explanation of how this snippet of testimony means something contrary.
Defendants also contend in their Statement of Disputed Facts that whether the portal to the adit is on the Johnstone Placer "has never been admitted by Defendants." Id. This is incorrect. In Defendants' brief opposing Montanore's motion for a preliminary condemnation order, Defendants expressly declared that "[t]he portal for the adit... is on [Montanore]'s private property." (Doc. 29 at 15.) Even if judicial estoppel is not applicable against Defendants based on this prior admission, Defendants fail to provide sufficient evidence to ...