Citizens vs. county

Court hearing held in CIZ petition case
By: 
Mikaela Koski
Thursday, August 2, 2018

In a packed courtroom last Thursday, 22nd Judicial District Court Judge Blair Jones heard arguments in the citizen initiated zoning (CIZ) petition lawsuit against the county.

While a formal decision from the judge has yet to be filed, it appeared the Beartooth Front Coalition (BFC) may have won the first round.

MOTION FOR SUMMARY JUDGEMENT

Last week’s hearing was held to consider the county’s (defense’s) motion for summary judgement.

A motion for summary judgement asks the court to rule in favor of one party to end the lawsuit early. In a June court order penned by Jones, he described it in this way: “The purpose of summary judgement is to dispose of claims for which there remain no genuine issues of material fact, thereby eliminating the expense and burden of a trial.”

The county did not initially file a motion for summary judgement, but rather, a motion to dismiss. As Jones explained in the order, “A motion to dismiss pursuant to M. R. Civ. P. 12(b)(6) requires a district court to determine whether a claim has been adequately stated in the pleadings. … The pleadings should not be dismissed unless it appears certain that the petitioner will be unable to recover under any set of facts which could be proven in support of the claim.”

In the June order, Jones converted the motion to dismiss to a motion for summary judgement, and explained that the document the defense rests its argument on – the actual CIZ petition submitted by the Beartooth Front group in 2015 and again in 2017 – cannot be considered in the motion to dismiss because the document was not attached to the original complaint made by the BFC.

By transforming the motion to dismiss to a motion for summary judgement, the judge could examine other documents outside the complaint, such as the petition, when coming to a decision.

After the court order was issued, the county had 30 days to submit new documents for the motion for summary judgement. The county did not submit anything, so last week’s hearing was held as originally scheduled.

DEFENSE

Bethany Gross, of the Budd-Falen law firm out of Cheyenne, Wyo., argued the case for the county. Stillwater County Attorney Nancy Rohde was also present on behalf of the defense.

While the county’s motion may have changed, its argument stayed the same – the petition is invalid because it seeks to regulate gas and oil, and the county does not have the authority to make such regulations.

Gross argued that such regulations as can be found under the “proposed rules” section of the Beartooth Front petition are pre-empted by state agencies’ regulations, particularly those created by the Montana Board of Oil and Gas Conservation.

In addition to arguing the Beartooth Front CIZ regulations would be pre-empted by other existing regulations, Gross also contended that Stillwater County, as a general power government, cannot regulate oil and gas because that power was not specifically given to the county.

The Beartooth Front petition’s proposed regulations were mentioned repeatedly by the county. Most of the discussion revolved around the idea that the proposed regulations are so specific they would interfere with existing laws.

Gross did agree, though, that it could be possible for broader regulations, focused more on land use rather than direct regulation of the drilling process, to not fall into the pre-emption dilemma, and thus be valid.

However, if that were the case, Gross argued, then the Beartooth Front zone would not be doing what it promised when the petition was signed by landowners.

PLAINTIFFS

David K. Wilson, the BFC’s attorney from the Morrison Sherwood Wilson & Deola law firm out of Helena, countered the defense’s arguments by saying the motion is premature.

Most of the county’s argument was based upon proposed regulations included in the petition. Wilson emphasized that those regulations are simply proposed – there is sill a significant process that would have to occur before such regulations went into effect.

The petition would first have to be validated, and then a public hearing would be held regarding the matter. If, after the public hearing, the county commissioners decided to go forward with the zone, a board would be created to oversee the new zone. Any regulations for the zone would be created by the board. By statute, the commissioners would serve on this board, as well as two additional county officials and two citizens appointed by the commissioners.

Wilson pointed out that there are still “a lot of ifs” before any regulations are created. A regulation cannot be preempted if it has not even been created yet, he argued.

The board would have to be careful when creating regulations to not find themselves in a pre-emptive situation, Wilson acknowledged. But, he said, there are some regulations that could be created that would not be interfering with other laws.

Wilson noted that the goal of the petition is to protect local landowners, not micromanage the technical aspects of drilling. He used land use zoning as an example of regulations that would be useful in such a situation without preempting any gas and oil laws.

JUDGE’S COMMENTS

Judge Jones did not issue a decision from the bench, but he said one would come soon. Despite not making a formal decision, Jones did make his thoughts on the matter known.

He seemed to disagree with the argument that the proposed regulations were pre-empted, saying it would be very speculative to rule against a regulation before it is even created.

“We wait. We’re reactive, not proactive,” Jones said, speaking of the role of the courts.

He explained that the court must allow the correct processes to be followed and not jump in and disrupt them halfway. Once a well-defined problem exists, for example if an approved regulation clashes with an existing statute, then the court can make a decision.

Jones also said he felt the commissioners should have the opportunity to make a decision among themselves about the pre-emption issue. By interfering and making a decision before that takes place, Jones said he feels the court would be overstepping its bounds and interfering with another branch of government.

“I don’t know if the court is too interested in taking power away from commissioners,” Jones noted.

As long as the other government agencies are following the correct procedures and due process is allowed, Jones said the court should not step in.

“REAL PROPERTY OWNER”

The other significant issue in the lawsuit – who exactly qualifies as a “real property owner” – was discussed by Jones briefly, although the hearing was for the pre-emption argument.

The judge noted that in chambers prior to Thursday’s hearing, he advised counsel from both sides that his initial thought was that mineral rights owners would count as real property owners.

As Jones described, at first glance, it seems that minerals would count as real property as long as they are in the ground. Once extracted, minerals would be considered personal property.

The judge said the issue of defining “real property owners” is a significant one, and it is an important ruling the court must make.

It is expected that the plaintiffs will file a motion for summary judgement regarding the issue, thus giving the defense a chance to respond and the judge an opportunity to examine the arguments and evidence.

The inclusion of mineral rights owners in the category of real property owners is significant because the county invalidated the Beartooth Front petition on the grounds that the correct percentage of affected real property owners’ signatures were not gathered.

The Beartooth Front group collected a sufficient number of landowners, the county argued, but it did not include mineral rights owners. By not including mineral rights owners, the Beartooth Front group did not meet the necessary threshold of 60 percent of affected real property owners, so the petition was invalid.

The current lawsuit was filed by the BFC because the group believes mineral rights owners do not count as real property owners, and thus the petition should have been validated.

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