Another North Dakota mineral rights case brought on by fracking

by Gary Taylor

Reep v. State
(North Dakota Supreme Court, December 26, 1014)

Several owners of land next to navigable waters in North Dakota (the “Reep owners”) sued the State, the North Dakota Board of University and School Lands, and the North Dakota Trust Lands Commissioner (“State”), seeking a declaration that the Reep upland owners own the mineral interests under the shore zone of the navigable waters.  The State responded that its title to the beds of navigable waters continues to extend, as it did at the moment of statehood, from high watermark to high watermark under the equal footing doctrine.

N.D.C.C. § 47-01-15 provides:  “Except when the grant under which the land is held indicates a different intent, the owner of the upland, when it borders on a navigable lake or stream, takes to the edge of the lake or stream at low watermark. All navigable rivers shall remain and be deemed public highways. In all cases when the opposite banks of any stream not navigable belong to different persons, the stream and the bed thereof shall become common to both.”

The State argues N.D.C.C. § 47-01-15 does not convey or grant public resources; rather, the statute is a rule of construction for conveyances of riparian land and clarifies the extent of a grantor’s conveyance to the grantee except when the grant under which the land is held indicates a different intent. The State argues the equal footing doctrine and the anti-gift clause prohibit construing N.D.C.C. § 47-01-15 as a State grant of the mineral interests under the shore zone to private entities. The upland owners countered that the State’s public trust and equal footing obligations relate to the public’s use of waters for “navigating, boating, fishing, fowling and like public uses” and do not relate to the proprietary privileges of ownership of subsurface mineral interests under the shore zone.

The Court looked first to history.

Before North Dakota was admitted to the Union, the United States held the beds of navigable waters in the Dakota Territory from high watermark to high watermark in trust for the future state.  Upon admission to the Union, North Dakota was entitled to sovereign ownership of the beds of navigable waters from high watermark to high watermark under the equal footing doctrine.  Upon entering the Union on equal footing with the established States, the “rights of riparian or littoral proprietors in the soil below high water mark of navigable waters [were] governed by the local laws.”  North Dakota could “resign to the riparian proprietor rights which properly belong to [it] in [its] sovereign capacity,” and was free to allocate property interests in the beds of navigable waters below the ordinary high watermark. However, North Dakota could not totally abdicate its interest to private parties because it held that interest, by virtue of its sovereignty, in trust for the public.

In a prior case the Court said N.D.C.C. § 47-01-15 did not grant an upland owner or the State absolute ownership of the shore zone and emphasized neither party’s interest in the shore zone was absolute. The word “takes” in that statute was ambiguous and the Court construed the statutory language as a rule of construction for determining the boundary for grants of land next to navigable waters.  The Court agreed with the State’s position that the State owned the mineral interests under the shore zone to the ordinary high watermark under the equal footing doctrine at the moment of statehood in 1889 and its ownership was thereafter governed by State law, including the anti-gift clause of N.D. Const. art. X, § 18, which precluded the state from allocating or gifting its mineral interests under the shore zone to an upland owner . N.D. Const. art. X, § 18,  currently provides:

The state, any county or city may make internal improvements and may engage in any industry, enterprise or business, not prohibited by article XX of the constitution, but neither the state nor any political subdivision thereof shall otherwise loan or give its credit or make donations to or in aid of any individual, association or corporation except for reasonable support of the poor, nor subscribe to or become the owner of capital stock in any association or corporation.

The court concluded N.D.C.C. § 47-01-15 does not convey or allocate the State’s equal footing interest in minerals under the shore zone, which the State owned at the moment of statehood in 1889, to upland landowners on navigable waters in North Dakota. Under the rule of construction for determining boundaries in N.D.C.C. § 47-01-15, however, if the State contractually grants or conveys parts of its equal footing interests to upland owners by deed, subject to the restrictions of the public trust doctrine, and except when the deed provides otherwise, the grantee takes the State’s full interest to the low watermark.

 

Leave a Reply

Your email address will not be published. Required fields are marked *

Archives

Categories