"Dueling Dinosaurs" and the Importance of Contracts
For my inaugural blog post, I wanted to find a topic that was interesting to me from not only a legal perspective but a factual one as well. As a kid, I loved to read about dinosaurs; earlier this week, I read about a case out of the 9th Circuit Court of Appeals (an appellate court which hears appeals from United States Federal District Courts on and near the West Coast) which met both my criteria.
In 2006, an amateur archaeologist discovered dinosaur fossils (which included a “nearly intact” Tyrannosaurus rex skeleton!) in Montana. I would have been hard-pressed to conceive of a cooler dinosaur fossil to uncover, but the archaeologist outdid himself—he also found a fossil, later termed the “Dueling Dinosaurs,” which consists of two dinosaurs, each over twenty feet long, fossilized while they were engaged in “mortal combat” with each other. Oh, and by the way—all the discovered fossils are, together, worth millions of dollars.
The legal dispute arose because, in Montana, it is common for property rights to be divided between “surface rights” and “mineral rights” due to the presence of valuable minerals (e.g. oil) below the surface. From the perspective of the “law and economics theory,” the division of surface rights and mineral rights is a great solution which adds value for all those involved: it allows parties who may derive substantial value from only one aspect of the property to retain that aspect and sell the other (for example, a rancher may purchase a property, sell the mineral rights to an oil speculator, and raise his cattle on the surface). However, it can get complicated—and expensive—when something unanticipated by the parties’ agreement is discovered underground.
In this case, the owners of the surface rights filed suit seeking a “declaratory judgment” (a mechanism Rhode Island business attorneys commonly employ) that they owned the fossils. The owners of the mineral rights filed a counterclaim asking the court to declare that they owned the fossils. The parties then filed “cross-motions for summary judgment” (another procedural tool also used by Rhode Island lawyers; this one can be used to expedite the resolution of a lawsuit when the parties can agree on most of the facts and just need to argue about the law). The Montana Federal District Court ruled in favor of the surface rights’ owners on the cross-motions, effectively determining that they owned the fossils.
On appeal to the 9th Circuit, that ruling was reversed—a multi-million dollar win for the mineral rights’ owners. The 9th Circuit undertook an analysis of the deed to the property which defined the rights and interests of the mineral owners and the surface owners. The court ultimately determined that the fossils constituted “minerals” based on the language of the parties’ deed…but not before tens, if not hundreds, of thousands of dollars were spent on attorneys, expert witnesses, and other litigation costs.
Although I don’t anticipate too many of my clients or readers will need help with Tyrannosaurus litigation, this case presents at least two important points of law that business owners (and, really, anyone who enters into a contract or has a legal dispute) can learn from.
First: it’s important that your Rhode Island contracts are prepared—or, at a minimum, reviewed—by a Rhode Island lawyer who has been hired specifically to protect your interests. This case was ultimately decided based on the deed to the property in question and whether, under the deed, the dinosaur fossils were considered “minerals.” Just like the courts in this case, Rhode Island courts will treat deeds like contracts in most respects, and if the language in the deed had been clearer about who owned what, the parties would not have had to resort to lengthy and expensive litigation and appeals to determine their rights. Don’t forget: the fossils were unearthed in 2006. It took a dozen years before the dispute was heard by the 9th Circuit on appeal!
Second: it’s always worthwhile to at least explore avenues of “alternate dispute resolution” (or ADR; generally referring to negotiation, arbitration, and/or mediation) to resolve legal disputes in Rhode Island or anywhere else. In addition to being lengthy and expensive, litigation tends to be an all-or-nothing proposition (the criminal defendant is either guilty or not; the civil defendant either breached the contract or didn’t; and so on), whereas ADR allows the parties to explore and discuss creative solutions to their differences. It rarely gives either party everything it wanted, but when successful, ADR tries to make sure both parties walk away with an agreement they can live with. But, most importantly, it saves time, money, and a ton of uncertainty along the way.
If you need to have a Rhode Island contract negotiated, written, or reviewed, or if you have a Rhode Island business law dispute or another type of legal matter which you’d like to try to resolve using ADR, contact me: I may be able to help—even if your case doesn’t involve T-rex fossils or fascinating appellate questions about the meaning of the word “mineral”!