Real property (or real estate) has many features and characteristics. Two of the features that exist in every parcel of real property are the surface rights, and the subsurface, or mineral rights. The surface rights generally includes the rights to use the surface of the property, such as building on the property, or traveling over the property. The subsurface rights, or the mineral rights, usually includes the right to remove, or extract, valuable minerals that may lie beneath the surface of the property. One person can own the surface rights, and a different can own the mineral rights. The right and ownership of mineral rights can be valuable. And while the definition of “minerals” might seem obvious, the true meaning of “minerals” may not always be clear.
It seems that the operator of a rock quarry hired a company to extract and crush rock from the quarry. The rock was extracted by using explosives, and then removing the broken rock from the surface of the ground. The removal of the rock caused the surface of the ground to be lowered. The crushed rock was used for such things as road base and was also used in asphalt and concrete.
There was a lot of money at stake in this case. The company that had extracted the rock claimed that it was owed over 1.5 million dollars plus interest for the work it had done. The company filed suit for payment, and claimed that under it was entitled to a “mining” lien on the quarry because it’s work in removing the rock amounted to “surface mining.” California Civil Code section 3060 states, among other things, that any person who performs labor in any mining claim is entitled to a lien upon such mining claim.
The Court of Appeal gave careful consideration to the claims of both parties. It quoted an 1885 California case which had found that Webster’s dictionary defines a mine as “a pit or excavation in the earth from which metallic ores or other mineral substances are taken by digging, distinguished from the pits from which stones only are taken, and which are called quarries.” The Court of Appeal further discussed that a “mining claim” is that portion of a “vein” or “lode” to which a claimant has acquired a right of possession pursuant to the “laws of the United States and the local rules and customs of miners.”
The Court engaged in a lengthy examination of whether “gravel” is a “mineral” and found that in some instances gravel might actually be properly considered to be a mineral, but not under the facts of this particular case. The court noted that “mineral” is generally defined as having a “definite chemical composition by which it can be easily recognized.” The court found that “commercial gravel is simply a jumbled mass of fragments of various minerals.” Because gravel usually consists of a mixture of materials instead of a specific substance, the court found that with respect to the alleged “mining claim” in this case, gravel was not a mineral and there was no “mining claim.”. As a result, the company hired by the quarry operator had no right to a lien on the quarry. However, there were other claims between the parties that are too lengthy to describe here. The end result was that the court found for purposes of this case that the “gravel” that was removed was not a “mineral.” Since no “minerals” were removed, and since there was no “mining claim,” there was no right to a lien on any “mining claim.” But the Court specifically noted that gravel might constitute a “mineral” in other situations. The case is reported as Sukut Construction, Inc. v. Rimrock CA LLC (2011) DJDAR 14846.
Lien laws, mining laws, and laws concerning non-payment are complex, and as shown by this case, the legal answer in any given situation can be difficult to determine. It’s not easy to determine what the law requires or provides in any given situation. Persons with claims, questions, or issues concerning liens, payment or contractual relations should consult a qualified legal professional.