Peterson v. Sanders

CONCLUSION
Tymar served and offered unanswered requests for admis-
sions, which were received in evidence. Under applicable law,
the substance of the unanswered requests should be deemed
admitted by the protestants. The Commission erred under
Rule 36 when it did not give legal effect to the substance of
unanswered requests Nos. 8 and 13 regarding, respectively, fit-
ness and necessity under § 75-311(1). The district court erred
as a matter of law when it failed to correct the Commission’s
rulings regarding these requests for admissions and affirmed
the Commission’s denial of Tymar’s application. We reverse
the decision of the district court and remand this cause to
the district court with directions to remand the action to the
Commission with directions to reconsider Tymar’s application
consistent with this opinion.
R eveRsed and Remanded with diRections.
peTeRSON v. SaNdeRS 	711
Cite as 282 Neb. 711
K evin J. P eteRson and Patti J. P eteRson, aPPellees , v.
stacia e. sandeRs , also Known as stacia e.
woods , et al ., aPPellants.
806 N.W.2d 566
Filed November 10, 2011. 	No. S-10-1170.
1. Equity: Appeal and Error. On appeal from an equity action, an appellate court
tries factual questions de novo on the record and, as to questions of both fact and
law, is obligated to reach a conclusion independent of the conclusion reached by
the trial court.
appeal from the district Court for Scotts Bluff County:
R andall l. liPPstReu, Judge. affirmed.
Rick L. ediger, Katie S. Baltensperger, and John F. Simmons,
of Simmons Olsen Law Firm, p.C., for appellants.
pamela epp Olsen, of Cline, Williams, Wright, Johnson &
Oldfather, L.L.p., for appellees.
heavican, c.J., connolly, G eRRaRd, stePhan, mccoRmacK,
and milleR-leRman, JJ., and sieveRs , Judge.
Nebraska Supreme Court Online Library
www.nebraska.gov/apps-courts-epub/
11/01/2026 04:44 AM CST

stePhan, J.
Record owners of surface property brought this equitable
action pursuant to Nebraska’s dormant mineral statutes.1 The
surface owners claimed the property’s severed mineral interests
had been abandoned and sought an order vesting title in the
severed mineral interests in them. We affirm the judgment of
the district court for Scotts Bluff County which vested title to
the mineral interests in the surface owners after determining
the mineral interests had been abandoned.
FaCTS
Kevin J. peterson and patti J. peterson, husband and wife,
reside in Scotts Bluff County, Nebraska. The petersons are the
record owners of real property described as: “east Half (e 1/2)
of the Southeast Quarter (Se 1/4) of Section Twenty-eight (28)
and the West Half (W 1/2) of the Southwest Quarter (SW 1/4)
of Section Twenty-Seven (27), Township Twenty-Two (22)
North, Range (58) West of the 6th p.M., Scotts Bluff County,
Nebraska.”
In 1953, Stacia e. Sanders and Floyd M. Sanders sold
this property and a warranty deed was filed in Scotts Bluff
County. at the time of the 1953 sale, Stacia and Floyd severed
and reserved unto themselves an undivided one-half interest
in all oil, gas, and mineral rights in and under the property.
Floyd died in 1960, and the mineral rights passed to Stacia.
On or about November 8, 1985, Stacia transferred the severed
mineral rights to her children, Kenneth e. Sanders, alice F.
Martin, Loree Mann, Myra Gaines, alva Richard Sanders, and
Theodore C. Sanders, appellants herein. Stacia died in 2000.
On July 23, 2010, the petersons filed a complaint in equity
naming Stacia’s children as defendants. The complaint alleged
that all claims to the mineral rights had been abandoned pursu-
ant to § 57-229 and sought a court order vesting title to all sev-
ered mineral rights in the petersons. The parties agree that in
the 23 years preceding the filing of the complaint, none of the
named defendants nor anyone acting on their behalf publicly
exercised a right of ownership in the mineral interests in any
1 Neb. Rev. Stat. §§ 57-228 to 57-231 (Reissue 2010).
712 	282 NeBRaSKa RepORTS

of the ways specified by § 57-229. The parties also agree that
in the 23 years preceding the filing of the complaint, no person
has recorded a verified claim of interest to the mineral rights in
Scotts Bluff County.
after an answer was filed, the district court held a bench
trial. The petersons offered the complaint, the answer, and
a joint stipulation of facts into evidence; all were received
without objection. Stacia’s children offered the 1953 warranty
deed that created the severed mineral interests and the 1985
quitclaim deed from Stacia to her children. Both were received
without objection. Theodore testified that he and his siblings
were unaware of any restriction on the mineral interests that
Stacia deeded to them.
after considering the evidence, the district court entered an
order finding appellants had abandoned the mineral interests
pursuant to § 57-229. The court declared the petersons the
owners of the mineral interests. The court reasoned that the
provisions of Nebraska’s dormant mineral statutes applied,
because for more than 23 years preceding the filing of the com-
plaint, appellants had not publicly exercised rights of owner-
ship. It specifically found that the case did not involve retro-
active application of the dormant mineral statutes, because the
transfer whereby appellants acquired their ownership inter-
est occurred in 1985, years after the statutes were enacted.
appellants filed this timely appeal.
aSSIGNMeNT OF eRROR
appellants assign that the district court erred in failing to
find that application of Nebraska’s dormant mineral statutes
against their severed mineral interests was an unconstitutional
retroactive application of the statutes.
STaNdaRd OF ReVIeW
[1] On appeal from an equity action, an appellate court tries
factual questions de novo on the record and, as to questions of
both fact and law, is obligated to reach a conclusion indepen-
dent of the conclusion reached by the trial court.2
2 See Schauer v. Grooms, 280 Neb. 426, 786 N.W.2d 909 (2010).
peTeRSON v. SaNdeRS 	713
Cite as 282 Neb. 711

aNaLYSIS
appellants argue that the district court erred in apply-
ing Nebraska’s dormant mineral statutes to them, because
the application was retroactive and therefore unconstitutional.
They contend that applying the statutes to them interferes with
their contractual rights and deprives them of both substantive
and procedural due process.
Several Nebraska statutes affect dormant mineral rights.
The primary statute at issue in this case is § 57-229, which
provides:
a severed mineral interest shall be abandoned unless
the record owner of such mineral interest has within the
twenty-three years immediately prior to the filing of the
action provided for in sections 57-228 to 57-231, exer-
cised publicly the right of ownership by (1) acquiring,
selling, leasing, pooling, utilizing, mortgaging, encumber-
ing, or transferring such interest or any part thereof by
an instrument which is properly recorded in the county
where the land from which such interest was severed is
located; or (2) drilling or mining for, removing, produc-
ing, or withdrawing minerals from under the lands or
using the geological formations, or spaces or cavities
below the surface of the lands for any purpose consistent
with the rights conveyed or reserved in the deed or other
instrument which creates the severed mineral interest; or
(3) recording a verified claim of interest in the county
where the lands from which such interest is severed are
located. Such a claim of interest shall describe the land
and the nature of the interest claimed, shall properly iden-
tify the deed or other instrument under which the interest
is claimed, shall give the name and address of the person
or persons claiming the interest, and shall state that such
person or persons claim the interest and do not intend to
abandon the same. The interest of any such owner shall
be extended for a period of twenty-three years from the
date of any such acts; Provided, that the provisions of this
section shall not apply to mineral interests of which the
State of Nebraska or any of its political subdivisions is
the record owner.
714 	282 NeBRaSKa RepORTS

The procedure by which a severed mineral interest may be
extinguished and canceled is set out in § 57-228:
any owner or owners of the surface of real estate from
which a mineral interest has been severed, on behalf
of himself and any other owners of such interest in the
surface, may sue in equity in the county where such real
estate, or some part thereof, is located, praying for the
termination and extinguishment of such severed mineral
interest and cancellation of the same of record, nam-
ing as parties defendant therein all persons having or
appearing to have any interest in such severed mineral
interest, and if such parties defendant are not known and
cannot be ascertained, they may be proceeded against as
unknown defendants under the provisions of Chapter 25,
article 3.
and according to § 57-230:
If the court shall find that the severed mineral interest
has been abandoned, it shall enter judgment terminating
and extinguishing it, canceling it of record, and vesting
the title thereto in the owner or owners of the interest
in the surface from which it was originally severed in
the proportions in which they own such interest in the
surface.
These statutes were intended to address title problems that
developed after mineral estates were fractured.3
The mineral interests at issue in this case were created in
1953, when they were severed from the surface property. The
essence of appellants’ argument is that because Nebraska’s dor-
mant mineral interest statutes were not enacted until 1967, after
the creation of the mineral interests at issue here, the statutes
can never be applied to those interests.
appellants’ argument is based on Wheelock & Manning OO
Ranches, Inc. v. Heath (Wheelock),4 a 1978 case which was
one of the first to address Nebraska’s dormant mineral statutes.
Wheelock involved an application of the statutes to mineral
3 Ricks v. Vap, 280 Neb. 130, 784 N.W.2d 432 (2010).
4 Wheelock & Manning OO Ranches, Inc. v. Heath, 201 Neb. 835, 272
N.W.2d 768 (1978).
peTeRSON v. SaNdeRS 	715
Cite as 282 Neb. 711

interests which were severed from the surface property in 1950.
The action to declare the severed interests abandoned was filed
more than 23 years after the defendants acquired their mineral
interests, but less than 23 years after enactment of the dormant
mineral statutes. Those statutes provided that in an action filed
within 2 years after enactment, “the owner of a severed min-
eral interest may enter his appearance and assert his interest
therein, and he shall be deemed thereby to have timely and
publicly exercised his right of ownership.”5 In Wheelock, this
court concluded:
In other words, the record title owners [of the mineral
interests] were required within 2 years from October
23, 1967, to take some affirmative action or lose their
property. In all actions filed after October 23, 1969, if
no affirmative action had been taken within 23 years,
the severed interest is to be considered abandoned. The
owner does not have any remedy. The statute, insofar as
it attempts to operate retroactively, is unconstitutional as
violative of the due process and contract clauses of the
United States and the Nebraska Constitutions.6
Several years after we decided Wheelock, the U.S. Supreme
Court reached a different conclusion with respect to dor-
mant mineral statutes which operate in a manner similar to
Nebraska’s. In Texaco, Inc. v. Short,7 the Court affirmed a
decision of the Indiana Supreme Court rejecting a constitu-
tional challenge to Indiana’s dormant Mineral Interests act,
which became effective in 1971. That act provided that mineral
interests which were unused for a period of 20 years would
be extinguished and revert to the owner of the surface estate,
unless the owner of the mineral interest filed a statement of
claim in accordance with the statute. The act further provided a
2-year grace period from the date of enactment in which own-
ers of mineral interests that were unused and subject to lapse
could preserve those interests by filing a claim.
5 § 57-231.
6 Wheelock, supra note 4, 201 Neb. at 845, 272 N.W.2d at 773-74.
7 Texaco, Inc. v. Short, 454 U.S. 516, 102 S. Ct. 781, 70 L. ed. 2d 738
(1982).
716 	282 NeBRaSKa RepORTS

The Indiana act was challenged by parties who acquired
mineral interests at the time of severance in 1942, 1944, and
1954, but had neither “used” the interests within the meaning
of the act nor filed a statement of claim within the 2-year grace
period. They challenged the constitutionality of the act on
grounds that the lack of prior notice of the extinguishment of
their mineral interests deprived them of property without due
process of law, affected a taking of private property for public
use without just compensation, and constituted an unconsti-
tutional impairment of contract. The Indiana Supreme Court
rejected those claims. prior to Texaco, Inc., several other state
supreme courts, including this court in Wheelock, had consid-
ered similar statutes and found them unconstitutional, at least
in part.8
The Texaco, Inc. Court held that while severed mineral
estates were considered to be vested property interests under
Indiana law and were entitled to the same protection as fee
simple titles, the state clearly had the power “to condition the
permanent retention of [a] property right on the performance of
reasonable conditions that indicate a present intention to retain
the interest.”9 The Court determined that retroactive application
of the statutes did not amount to a taking without just com-
pensation, because “[i]t is the owner’s failure to make any use
of the property—and not the action of the State—that causes
the lapse of the property right . . . .”10 and the Court rejected
the contention that the application of the statutes affected a
contractual right, finding that the right at issue was a property
right, not a contractual one.
With respect to whether the dormant mineral statutes gave
sufficient notice to comport with due process, the Court stated:
“Generally, a legislature need do nothing more than enact
and publish the law, and afford the citizenry a reasonable
8 See, Wilson v. Bishop, 82 Ill. 2d 364, 412 N.e.2d 522, 45 Ill. dec. 171
(1980); Contos v. Herbst, 278 N.W.2d 732 (Minn. 1979); Wheelock, supra
note 4; Chicago & N. W. Transp. Co. v. Pedersen, 80 Wis. 2d 566, 259
N.W.2d 316 (1977).
9 Texaco, Inc. v. Short, supra note 7, 454 U.S. at 526.
10 Id., 454 U.S. at 530.
peTeRSON v. SaNdeRS 	717
Cite as 282 Neb. 711

opportunity to familiarize itself with its terms and to comply.”11
Further, it reasoned that it was “well established that persons
owning property within a State are charged with knowledge
of relevant statutory provisions affecting the control or dis-
position of such property.”12 The Court held that “it has never
been suggested that each citizen must in some way be given
specific notice of the impact of a new statute on his property
before that law may affect his property rights.”13 It also noted
that according to the Indiana act, before any judgment could be
entered quieting title in the surface owner, the full procedural
protections of the due process Clause, including notice and an
opportunity to be heard, would be afforded.
The dissent in Texaco, Inc. concluded that retrospective
application of the Indiana act to persons who owned severed
mineral interests prior to its enactment deprived them of due
process. But in reaching this conclusion, the dissent drew the
following distinction, which is important to our resolution of
this case:
as to one class of mineral interest owners, there is no
question that the statute is a constitutionally proper exer-
cise of the State’s power. every mineral interest in land
carved from the fee after the effective date of the statute
was carved subject to the statute’s limitations. In pro-
spective application the statute simply provides that any
instrument purporting to transfer a mineral interest carries
with it the implicit condition that unless the transferee
uses the land within the meaning of the statute, his inter-
est will revert to the transferor. It is only where the State
seeks to change the fundamental nature of a property
interest already in the hands of its owner that the opera-
tive restrictions of both the Takings Clause and the due
process Clause come into play.14
11 Id., 454 U.S. at 532.
12 Id.
13 Id., 454 U.S. at 536.
14 Id., 454 U.S. at 542 (Brennan, J., dissenting; White, Marshall, and powell,
JJ., join).
718 	282 NeBRaSKa RepORTS

We need not decide whether Wheelock remains good law
after Texaco, Inc. with respect to retroactive application of
Nebraska’s dormant mineral statutes, because we agree with
the district court that the statutes have not been applied retro-
actively to appellants. The critical date in this case is not 1953,
when the mineral interests were severed, but, rather, 1985,
when they were transferred by Stacia to appellants. prior to
1985, appellants had no right of ownership in the severed
mineral interests that could have been affected by the dor-
mant mineral statutes. The transfer by Stacia and acquisition
by appellants in 1985 occurred years after the enactment of
the dormant mineral statutes and prevented the abandonment
of the severed mineral interests for at least 23 years into the
future.15 at the time of the transfer, appellants were presumed
to have knowledge of the law then in effect which affected
their prospective enjoyment and retention of the mineral inter-
ests.16 Unlike the plaintiffs in Wheelock, appellants had the full
23-year period specified in § 57-229 to publicly exercise their
right of ownership so as to prevent abandonment of the mineral
interests. They failed to do so, and the district court did not err
in determining that those interests had been abandoned under
the provisions of § 57-229.
CONCLUSION
For the reasons discussed, we affirm the judgment of the
district court.
affiRmed.
wRiGht, J., not participating.
15 See § 57-229(1).
16 See, Texaco, Inc. v. Short, supra note 7; State ex rel. Counsel for Dis. v.
Wintroub, 277 Neb. 787, 765 N.W.2d 482 (2009); State v. Veiman, 249
Neb. 875, 546 N.W.2d 785 (1996).
peTeRSON v. SaNdeRS 	719
Cite as 282 Neb. 711