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North Dakota Workers Compensation Bureau v. General Investment Corp.

12/7/2000

Appeal from the District Court of Stark County, Southwest Judicial District, the Honorable Zane Anderson, Judge.


AFFIRMED.


Opinion of the Court by Maring, Justice.


[ ] The North Dakota Workers Compensation Bureau ("the Bureau") and Empire Oil Company ("Empire") have appealed a judgment ruling parties claiming a mineral interest in certain land through the Bureau "have no estate, right, title, lien or interest in title to the mineral estate and mineral leasehold estate in those lands," and quieting title to the subject lands in General Investment Corporation and the other defendants in the action. We conclude the Bureau and Empire have no interest in the subject mineral estate, and we affirm.


[ ] Dickinson Fire and Pressed Brick Co. acquired title to the surface and the mineral estate in the subject land in 1902. In 1928, Dickinson Fire and Pressed Brick Co. mortgaged the land to secure the issuance of bonds and created a trust for the bondholders. The mortgage was foreclosed and a sheriff's certificate, dated December 4, 1934, was issued to M.A. Brannon, Trustee. On December 17, 1934, Brannon assigned the sheriff's certificate to Dickinson Clay Products Company. The State, through the Bureau, obtained a judgment against Dickinson Clay Products Company for unpaid workers compensation premiums. A May 16, 1939, sheriff's certificate was issued to the State, doing business as the Bureau. On July 30, 1940, the sheriff executed a deed to the State, reciting, in part, he does "hereby, give, grant and convey to the said State of North Dakota all the estate, right, title and interest in and to said land . . . of . . . said Dickinson Clay Products Company." The 1940 sheriff's deed was filed for record with the register of deeds on January 21, 1948.


[ ] In 1947, proceedings were brought in district court about the administration of the trust created by Dickinson Fire and Pressed Brick Co. in 1928. In that proceeding, the district court found M.A. Brannon, as trustee for the bondholders, foreclosed and became the owner of the Dickinson Fire and Pressed Brick Co. for the benefit of the bondholders. The court found the "sheriff's certificate issued to the Dickinson Fire and Pressed Brick Company for the sale of the real estate was assigned and delivered to the said Dickinson Clay Products Company" without any consideration and in violation of an agreement between Trustee Brannon, the bondholders, and Dickinson Clay Products Company. On April 2, 1947, the court removed Brannon as the trustee of the trust and appointed J.A. O'Brien and Martin Binek as trustees. The court ordered the trustees to "institute such actions . . . as shall be necessary to recover for the said trust the title and possession of that certain real estate . . . and any other property, real or personal, in which the said trust has a claim."


[ ] By petition of December 2, 1947, O'Brien and Binek sought authority to sell the subject real estate and to compromise claims. The petition recited, in part:


That the title and ownership of said real estate is, and has been since May 16th, 1939, claimed by the State of North Dakota, doing business as The North Dakota Workmen's Compensation Bureau, under and by virtue of a judgment and execution sale obtained against Dickinson Clay Products Company . . . the property can now be sold for an amount several times in excess of its former value.


The petition recited the petitioners had received bids totaling $17,000 for the three tracts involved. The petition further recited:


In order to consummate said sale proposed herein it is necessary to settle the claim of the State of North Dakota in said premises.

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