Schepke v. Department of Natural Resources, Docket No. 120204
| Decision Date | 19 November 1990 |
| Docket Number | Docket No. 120204 |
| Parties | Gerard W. SCHEPKE, Plaintiff-Appellee, v. DEPARTMENT OF NATURAL RESOURCES, Defendant-Appellant. 186 Mich.App. 532, 464 N.W.2d 713 |
| Court | Court of Appeal of Michigan — District of US |
[186 MICHAPP 532] Wenzel, Papp & Yahne by Karen Jo Wenzel, Alpena, for plaintiff-appellee.
[186 MICHAPP 533] Frank J. Kelley, Atty. Gen., Gay Secor Hardy, Sol. Gen., and Thomas J. Emery and Kevin T. Smith, Asst. Attys. Gen., for defendant-appellant.
Before BRENNAN, P.J., and MacKENZIE and WEAVER, JJ.
The Michigan Department of Natural Resources appeals as of right the August 7, 1989, order of the Presque Isle Circuit Court granting summary disposition in favor of Gerard W. Schepke. The court ruled that Schepke, as a matter of law, was the lawful owner of certain property and that the DNR had no valid interest in or claim to the mineral rights of the property. We reverse and remand.
In 1911, the state sold the property in issue, reserving the mineral rights. In 1915, an "attested correct copy" of the deed was recorded, which did not contain a reservation of the state's mineral rights. In 1931 and 1932, the property was returned to the state for nonpayment of taxes. The state sold the property again in 1933, and no mention was made of mineral rights. In 1968, the DNR recorded a lease of oil and gas rights on the property. Later that year the lessee recorded an assignment of fifty percent of its interest. In 1980, the lease interest was released to the state, and the release was recorded. On June 11, 1987, Schepke obtained title to the property and recorded his interest on June 19, 1987.
On June 9, 1988, Schepke brought this action, seeking a declaration that he was the owner of the property and that the DNR had no valid interest in the property's mineral rights. The DNR moved for summary disposition, alleging that there was no issue of material fact, but that only a question of [186 MICHAPP 534] law existed. The parties filed a stipulation of facts and exhibits, and Schepke moved for summary disposition.
In its opinion, the trial court held that Schepke had constructive notice of the possible rights of a third party (the state) and that Schepke was not protected by the recording act. The court also determined that a merger of the title to the mineral and surface rights had not occurred when the state took possession of the property in 1931 and 1932. The court then ruled that the state was estopped from claiming title to the mineral rights on a theory of equitable estoppel, finding that the state had represented that it held no interest and that Schepke had justifiably relied on this representation to his prejudice.
A motion for summary disposition under MCR 2.116(C)(10) tests the factual sufficiency of a party's claim. The court must give the benefit of any reasonable doubt to the party opposing the motion and grant the motion only if it is impossible for the claim to be supported at trial because of a deficiency which cannot be overcome. Brackens v. Detroit Osteopathic Hospital, 174 Mich.App. 290, 435 N.W.2d 472 (1989), lv. den. 433 Mich. 857 (1989).
We have before us only the issue of equitable estoppel. Specifically, the question is whether the State of Michigan is estopped from claiming title to mineral rights in plaintiff's property where no reservation of these rights to the state was recorded, but a lease of mineral rights from the state to a third party was recorded.
The trial judge found that the DNR was estopped from claiming title to the mineral rights because the state had represented though the 1915 deed that it held no such interest.
The doctrine of equitable...
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