Rasmussen Drilling, Inc. v. Kerr-McGee Nuclear Corp.

• Decision Date: 13 February 1978
• Docket Number: KERR-M,No. 76-1729,76-1729
• Parties: RASMUSSEN DRILLING, INC., a Colorado Corporation licensed to do business in Wyoming, Plaintiff-Appellant, v.cGEE NUCLEAR CORPORATION and Kerr-McGee Corporation, Defendants-Appellees.
• Court: U.S. Court of Appeals — Tenth Circuit

Page 1144

571 F.2d 1144

RASMUSSEN DRILLING, INC., a Colorado Corporation licensed to do business in Wyoming, Plaintiff-Appellant, v. KERR-McGEE NUCLEAR CORPORATION and Kerr-McGee Corporation Defendants-Appellees.

No. 76-1729.

United States Court of Appeals Tenth Circuit.

Submitted Nov. 18, 1977.

Decided Jan. 18, 1978.

Rehearing Denied Feb. 13, 1978.

James R. Prochnow, Denver, Colo. (Thomas J. Constantine, Denver, Colo., on the brief), of Hindry & Meyer, Denver, Colo., for plaintiff-appellant.

Peter H. Holme, Jr., Denver, Colo. (Edmond F. Noel, Jr., Denver, Colo., on the brief), of Holme, Roberts & Owen, Denver, Colo., William T. Schwartz, Casper, Wyo., Derrill Cody and Clydine Cornett, Oklahoma City, Okl., for defendants-appellees.

Before SETH, McWILLIAMS and BARRETT, Circuit Judges.

BARRETT, Circuit Judge.

Rasmussen Drilling, Incorporated (Rasmussen), a Colorado corporation, plaintiff below, appeals form a jury verdict and judgment dismissing its complaint and cause of action against Kerr-McGee Nuclear Corporation and Kerr-McGee Corporation (Kerr-McGee), defendants below, seeking a quiet title decree and order of ejectment involving certain lode mining claims situate in Section 17, Township 35 North, Range 74 West of the 6th P.M., Converse County, Wyoming.

Following considerable pleading and pre-trial discovery, an eight-day trial to a jury was concluded on June 2, 1976. The record is voluminous. The critical issue presented for decision was: Which of the parties had prior possessory rights by reason of substantial compliance with the federal and Wyoming mining laws requisite for the establishment of valid lode mining claims in Section 17? The parties entered into a written stipulation that the respective claims were proved to be valuable following discovery of uranium ore. Thus, the bulk of the evidence dealt with the statutory requirements involving staking, location monuments, validation, core drilling, filings, and matters of both actual and constructive notice.

Some of the general rules governing appellate review of a jury verdict following trial of a diversity based civil case may be helpful guidelines leading to our disposition of the challenges raised. A party seeking reversal must establish that alleged trial court errors were prejudicial and clearly erroneous, rather than harmless. Fed.Rules Civ.Proc. rule 52(a), 28 U.S.C.A. It is not the function of the appellate court to infer material facts or to make controlling inferences which the trial court (or jury) has not inferred or made and which, if done, would, in effect, constitute trial de novo. Transport Equipment Co. v. Guaranty State Bank, 518 F.2d 377 (10th Cir. 1975). A choice between two permissible views of the evidence is not "clearly erroneous." United States v. Yellow Cab Company, 338 U.S. 338, 70 S.Ct. 177, 94 L.Ed. 150 (1949); Kiner v. Northcutt, 424 F.2d 222 (10th Cir. 1970). Where an issue is not clear of doubt, the views of a federal district judge (in a diversity case) who is a resident of the state where the controversy arose interpretive of that state's laws, carry extraordinary force on appeal where there are no state decisions directly on point or none which provide a clear precedent. United States v. Hunt 513 F.2d 129 (10th Cir. 1975). Upon review, the appellate court does not retry the facts, and a trial court finding based on sharply conflicting evidence is binding. Buena Vista Homes, Inc. v. United States,281 F.2d 476 (10th Cir. 1960). Jurors are charged with the exclusive duty of assessing the credibility of witnesses and determining the weight to be given testimony, taking into consideration the appearance and general demeanor of each and every witness. United States v. Downen, 496 F.2d 314 (10th Cir. 1974), cert. denied, 419 U.S. 897, 95 S.Ct. 177, 42 L.Ed.2d 142 (1974). Trial court findings on sharply conflicting evidence are conclusively binding on appeal. Golubin v. United States, 393 F.2d 590 (10th Cir. 1968), cert. denied, 393 U.S. 831, 89 S.Ct. 100, 21 L.Ed.2d 102 (1968); United States v. 79.95 Acres of Land, More or Less, in Rogers County, State of Oklahoma, 459 F.2d 185 (10th Cir. 1972); Davis v. Cities Service Oil Company, 420 F.2d 1278 (10th Cir. 1970). Our review in relation to evidence, is limited to the inquiry whether the record contains substantial evidence to support a conclusion. Consolidated Edison Co. v. National Labor Relations Board, 305 U.S. 197, 59 S.Ct. 206, 83 L.Ed. 126 (1938). Appellate courts do not impute to a jury the inability to understand correctly the totality of the trial court's instructions, even in a complicated case, nor will courts impute nonfeasance, in the form of disregard of the trial court's instructions, to a jury. United States v. Smaldone, 485 F.2d 1333 (10th Cir. 1973); Ellis v. State of Oklahoma, 430 F.2d 1352 (10th Cir. 1970), cert. denied, 401 U.S. 1010, 91 S.Ct. 1260, 28 L.Ed.2d 546 (1971). The jury or the court if the case is tried without a jury has the exclusive function of appraising credibility, determining the weight to be given to the testimony, drawing inferences from facts established, resolving conflicts in the evidence, and reaching ultimate conclusions of fact. Loew's Inc. v. Cinema Amusements, 210 F.2d 86 (10th Cir. 1954), cert. denied, 347 U.S. 976, 74 S.Ct. 787, 98 L.Ed. 1115 (1954). The reviewing court must view the evidence in the light most favorable to the prevailing party. Joyce v. Davis, 539 F.2d 1262 (10th Cir. 1976); Hart v. Western Inv. & Development Co., 417 F.2d 1296 (10th Cir. 1969). No error in either the admission or the exclusion of evidence and no error in any ruling or order or in anything done or omitted by the trial court or by the parties is ground for granting a new trial or for setting aside a verdict unless the error or defect affects the substantial rights of the parties. Fed.Rules Civ.Proc. rule 61, 28 U.S.C.A.; Harris v. Quinones, 507 F.2d 533 (10th Cir. 1974); Herron v. Rozelle, 480 F.2d 282 (10th Cir. 1973). The trial court's conduct of trial proceedings, including rulings on motions and objections, will not be disturbed on appeal unless it affirmatively appears from the record that the trial court abused its discretion. White Motor Corporation v. Stewart,465 F.2d 1085 (10th Cir. 1972), cert. denied, 409 U.S. 1061, 93 S.Ct. 561, 34 L.Ed.2d 513 (1972).

We turn now to a summary review of the evidence in the record before us, considered in the light most favorable to Kerr-McGee, the prevailing party.

Kerr-McGee had engaged in uranium exploration in the South Powder River Basin of Wyoming for several years prior to 1967. That year it commenced uranium ore exploration work on Section 17, Township 35 North, Range 74 West of the 6th P.M., Converse County, Wyoming. The results of the exploratory work were such that Kerr-McGee decided to stake lode mining claims in Section 17. Kerr-McGee proceeded first to contact the surface estate owners, William J. Smith and Florence Coates, respectively, relative to surface use and damage agreements in contemplation of mining activities. Written surface agreements were soon entered into between the parties. Kerr-McGee then hired Worthington, Lenhart & Associates, Inc., to coordinate and supervise the necessary surveying, staking and validation drilling of lode mining claims in Section 17. When completed they became known as the Yike claims. William G. Ladd of the Lenhart firm, a graduate civil engineer and licensed land surveyor, testified that he personally supervised the location work on the Yike claims commencing October 30, 1967. Validation holes were drilled on the respective claims in November, 1967, by William Kampf, an employee of a drilling company. Staking of the claims was substantially accomplished before December, 1967, but, because of harsh weather, some side-center stakes were not in place until May of 1968. The Kerr-McGee discovery, staking and location work was thus accomplished before Rasmussen undertook any staking or other location work. Kerr-McGee's location certificates for its various Yike lode claims covering all of Section 17 were completed and filed in the name of its agent, William G. Ladd, in the office of the County Clerk of Converse County, Wyoming, on December 27, 1967. By inadvertence and oversight a clerical error was made in the description of the claims in that the location certificates described the section as 19 rather than 17. These mistakes were not discovered until sometime early in August, 1968, when Robert Marvin, of Kerr-McGee, noted them while reading a monthly land check magazine known as "Dever Report." On August 8, 1968, Kerr-McGee caused amended lode mining certificates correcting the section description to be filed of record covering each of its Yike lode claims staked in Section 17. In February, 1968, Kerr-McGee undertook radiometric probing of its Yike claims validation holes, conducted by Bruce Johnston of Century Geophysical Corporation. Kerr-McGee performed the requisite annual assessment work on its Yike claims in conjunction with a wide-ranging mineral discovery-exploration program throughout the South Powder River area. Kerr-McGee presented trial testimony of the following witnesses relating to its discovery, surface agreement and location work, staking and drilling of validation holes on its Yike claims, all accomplished prior to July, 1968: William G. Ladd, A. L. Worthington, Edward R. Brandt, William J. Smith, William David Reese, Jr., William Kampf, Bruce N. Johnston, William O. Fields, Jay W. Smith, John G. Jebsen, and Florence Coates.

Rasmussen commenced its location work on claims in Section 17 in July and August of 1968 under the direction of Fred Carr. Ed Engleman, a landman, conducted an examination of the records in the office of the County Clerk of Converse County, Wyoming, at Carr's request. He did not find any lode mining certificates filed in Section 17; however, he did find that Section 19 contained a...