Northern Improvement Co. v. United States

          ORDER

          David G. Campbell Senior United States District Judge.

         Plaintiffs Northern Improvement Company (“NIC”), Alfred Jay Schritter, and Tomma Schritter filed this action against Defendant the United States to quiet title to the sand and gravel in two Arizona parcels pursuant to the Quiet Title Act, 28 U.S.C. § 2409a (“the QTA”). Doc. 12. Defendant has filed motions to dismiss for lack of subject matter jurisdiction and for summary judgment, and Plaintiffs have filed a cross-motion for summary judgment. Docs. 127, 134. The motions are fully briefed. Docs. 128, 135, 136, 138, 140. Pursuant to Rule 56(f), the Court will order further briefing on the issues discussed below. See Fed. R. Civ. P. 56(f)(1)-(3).

         I. Background.

         The following is the undisputed history of the two parcels at issue in this case, the Schritter Parcel and the NIC Parcel. See Doc. 126.^[1]

         A. The Schritter Parcel.

         In 1923, Defendant patented the surface and mineral estates of certain federal lands, including the Schritter Parcel, to Burlington Northern Santa Fe Railway Co. (“Santa Fe”).^[2]Id. at 1. In a 1950 warranty deed, Santa Fe conveyed some of these lands, including the Schritter Parcel, to George F. Getz Jr. Id. at 2. This order will refer to this as the Getz Deed. The Getz Deed included two provisions through which Santa Fe reserved the mineral estate and certain rights in the property conveyed to Getz. This order will refer to the first provision as the Schritter Mineral Reservation and to the second provision as the Schritter Railroad Reservation. See Id. at 2-3.

         In a 1988 warranty deed, a successor in interest to Getz conveyed to Defendant various lands, including the same interest in the Schritter Parcel that Getz acquired with the Getz Deed. Id. at 3. This order will refer to this 1988 deed as the West Wing Deed. The West Wing Deed excepted “all oil, gas, coal and minerals, as reserved” in the Getz Deed. Id.

         In an October 2003 quitclaim deed, Santa Fe conveyed to the Schritters its “right, title and interest, if any, in and to decorative rock, sand, and gravel” in the Schritter Parcel. Id. In a March 2004 quitclaim deed, Santa Fe conveyed to the Schritters “all Santa Fe's right, title and interest, if any” in the Schritter Parcel. Id.

         B. The NIC Parcel.

         In 1924, Defendant patented its interest in certain federal lands, including the NIC Parcel, to Santa Fe.^[3] Id. In a 1938 Indenture, Santa Fe conveyed these lands, including the NIC Parcel, to Willie Wall, but reserved a mineral estate. Id. at 4. This order will refer to this deed as the Wall Deed. Like the Getz Deed, the Wall Deed included two provisions through which Santa Fe reserved the mineral estate and certain rights in the property conveyed to Wall. This order will refer to these provisions as the NIC Mineral Reservation and the NIC Railroad Reservation.

         In the 1988 West Wing Deed, a successor in interest to Wall conveyed to Defendant the interest in the NIC Parcel that Wall received through the Wall Deed. Id. at 5. The West Wing Deed - like the Getz Deed for the Schritter Parcel - excepted “all oil, gas, coal and minerals, as reserved in” the Wall Deed with respect to the NIC Parcel. Id.

         In 2002, Santa Fe quitclaimed to Tri-R Construction, Inc. (“Tri-R”) “all of Santa Fe Pacific Railroad Company's right, title and interest, if any, in and to sand, gravel and decorative rock located within 100 feet of the surface” of land, including the NIC Parcel. Id. at 5. Tri-R quitclaimed that same interest in the NIC Parcel to NIC in 2004. Id.

         C. Deed Language.

         The parties agree that no relevant differences exist between the NIC and Schritter Mineral Reservations, which this order will refer to collectively as the Mineral Reservations. Id. at 4. The parties also agree that no relevant differences exist between the NIC and Schritter Railroad Reservations, which the order will refer to collectively as the Railroad Reservations. Id. at 5.

         Because the parties agree that no material differences exist in the language of the two deeds, the Court will refer only to the Getz Deed language for purposes of this order. The Getz Deed Mineral Reservation states:

Grantor expressly reserves and excepts all oil, gas, coal and minerals whatsoever, already found or which may hereafter be found, upon or under said lands, with the right to prospect for, mine, and remove the same and to use so much of the surface of said lands, as shall be necessary and convenient for shafts, wells, tanks, pipe lines, rights of way, railroad tracks, storage purposes and other and different structures and purposes necessary and convenient for the digging, drilling, and working of any mines or wells which may be operated on said lands. Grantor or its successors and assigns, will pay to Grantee, or it successors or assigns of grantee, a fixed price per acre for the surface of all lands appropriated under this exception and reservation, which price shall be equal to the average price per acre paid for all the lands above described, together with the fair market value of the buildings and permanent improvements, ...