TAGS Realty, LLC v. Runkle

TAGS Realty, LLC v. Runkle, 2015 MT 166 (June 23, 2015) (Wheat, J.) (5-0, rev’d)

Issue: Whether the district court erred in granting summary judgment to Runkle on TAGS’s trespass and conversion claims.

Short Answer: Yes.

Reversed and remanded

Facts: Runkle and TAGS are the locators of several adjacent and overlapping mining claims in Broadwater County. Runkle purchased a patented lode claim, Black Friday, in 2009. TAGS located an unpatented lode claim next to Black Friday in 2010. In 2011, Runkle bought an unpatented placer claim that overlapped both TAGS’s claim and Black Friday. This case involves a pile of mining waste located on both Runkle’s and TAGS’s claims, which overlapped the common border of TAGS’s claim and the Black Friday claim, and was entirely within Runkle’s placer claim.

The origin of the waste is a disputed fact. Both parties agree that the waste contained gold deposits that were not economically viable when they were removed from an historic mine, but became viable by 2011, when Runkle removed and sold all of the waste. It is undisputed that Runkle entered TAGS’s claim and removed the waste located within TAGS’s claim.

TAGS sued for trespass and conversion. After discovery, the parties stipulated that the case could be decided on summary judgment.

Procedural Posture & Holding: The parties filed cross-motions for summary judgment, and the district court held a hearing. The court found that TAGS had no property interests upon which to maintain its claims, and entered judgment for Runkle. TAGS appeals and the Supreme Court reverses.

Reasoning: The district court held that (1) TAGS’s claim was invalid because it had failed to discover any valuable lode materials there, and (2) even if it were a valid lode claim, TAGS had no right to the waste materials, which were placer deposits. The Supreme Court cannot affirm on either ground.

A lode claim is valid only if it is supported by the discovery of lode materials on the claim. Here, the existence of a lode discovery on TAGS’s claim was never questioned or raised by the parties. The district court should not have granted summary judgment on an issue never raised, addressed or conceded by the parties. It should have allowed TAGS to present evidence raising a genuine issue of fact before granting summary judgment.

Additionally, even if TAGS could not assert an interest in the waste materials, it may have had the right to exclude Runkle from its claim. This is a question of fact that the district court inappropriately resolved against TAGS.