Newmont Exploration Ltd. v. Siskon Corp.
| Decision Date | 23 January 1980 |
| Docket Number | No. 2,CA-CIV,2 |
| Parties | NEWMONT EXPLORATION LIMITED, a Delaware Corporation, and Magma Copper Company, a Delaware Corporation, Plaintiffs/Appellees, v. SISKON CORPORATION, a Delaware Corporation, Defendant/Appellant. 3354. |
| Court | Arizona Court of Appeals |
Twitty, Sievwright & Mills by Howard A. Twitty, Phoenix, for plaintiffs/appellees.
Verity, Smith & Clark, P. C. by Leo N. Smith, Tucson, for defendant/appellant.
This appeal arises from the trial court's granting of appellees' motion for summary judgment and denial of appellant's cross-motion for summary judgment. The sole issue is the proper interpretation of the provisions of an option and royalty agreement covering various mining claims located in the Bunker Hill Mining District, Pinal County.
The parties to the agreement were appellant Siskon Corporation, owner of the mining claims (Siskon), and appellees Newmont Exploration Limited and Magma Copper Company (Newmont/Magma), purchasers of the claims.
The portions of the agreement relevant to the issue before us are as follows:
"WHEREAS, Siskon warrants that it is the owner of the mineral claims and other property situate in Pinal County, Arizona, all more particularly described in the annexed Exhibit A, free and clear of any and all claims and encumbrances whatsoever save as shown in said Exhibit A, together with all rights, privileges and appurtenances pertaining hereto or connected therewith, including all water and water rights, rights of way and easements appurtenant to or held, owned, developed or used in connection therewith, both recorded and unrecorded, all hereinafter sometimes referred to as the 'Property'; and . . . .
4. Title . . .
d) If it shall appear that in the location of any of the unpatented claims included within the Property, such locations were made so that the unpatented claims do not constitute a contiguous body of claims without interior gaps and that one or more of such claims can be amended so as to eliminate such interior gaps, then Newmont and Magma, in the name of and as agent for Siskon, may amend any of the locations of such claims for that purpose, and the parties hereto agree to execute any further documents necessary to enable Newmont and Magma so to do. If it shall appear that the location of any of the unpatented mining claims included with the Property as originally located, or as such locations may be amended, are such that there are present a fractional area or areas unlocated, then Newmont and Magma, in the name of and as agent for Siskon, may locate such fractional areas as mining claims, and the parties hereto agree to execute any further documents to enable Newmont and Magma so to do and all such amended or new locations shall be deemed to be part of the property. . . .
5. Royalty . . .
e) The production royalty payments shall be computed on ores mined by Newmont and Magma only from within planes projected vertically downward through the exterior boundary lines of the mining claims described in Parcels One and Three of Exhibit 'A'.
15. New Mining Locations
In the event that any mining claim or claims, other than those named and described herein, are presently owned by Siskon or any officer thereof, or in the event that any mining claim or claims are located by or for Siskon, or for H. B. Chessher, Sr., Jane E. Chessher, and or H. B. Chessher, Jr., after the date hereof and before Newmont and Magma have paid the full purchase price for the royalty interest as provided in Paragraph 6, the discovery monuments of which are less than one (1) mile from the nearest exterior boundary of the group of claims both patented and unpatented described in Exhibit 'A', said claim or claims shall be deemed to be included within the scope of this Option Agreement as though named and described herein, and the title of such claim or claims, if Newmont and Magma make all payments herein set forth, shall be or be deemed to have been acquired by Newmont and Magma, and Siskon covenants and agrees to execute the necessary conveyances by which title thereto shall be transferred to Newmont and Magma in the event that they pay the full purchase price of FIVE HUNDRED THOUSAND DOLLARS ($500,000.00), all without any increase in price in any sum whatsoever."
The parties interpret subparagraph 4(d) and paragraph 15 differently and disagree as to whether the claims covered by those sections of the agreement are included within the scope of paragraph 5 and therefore subject to royalty payments.
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