Pronschinske Trust v. Kaw Valley Companies, Inc.

Dist. Ct. did not err in granting defendant-mining company’s motion for summary judgment in action by plaintiff-property owner alleging that defendant owed it $400,000 in royalty payments under terms of lease allowing defendant to mine sand and rock products, but also allowing defendant not to extract or sell sand or rock products by virtue of said lease. Dist. Ct. could properly find that defendant did not owe any royalty payments, where record showed that: (1) although defendant undertook certain infrastructure improvements on plaintiff’s land, defendant never extracted any sand or rock products from plaintiff’s land; and (2) lease provided that defendant pay plaintiff $1.50 per ton for first 65,000 tons of sand or rock products. While plaintiff argued that lease provision in same paragraph containing above royalty provision (i.e., “notwithstanding anything to contrary contained herein [defendant] shall pay [plaintiff annual minimum royalty of $75,000]”) guaranteed it $75,000 in royalty payments regardless of whether defendant had extracted any sand or rock products, Dist. Ct. could properly find that said provision only applied if defendant had extracted any sand or rock product in any given year, and that $75,000 provision applied as floor for royalty payments once obligation to pay royalties had been triggered.