Author Archives: Andrew Irvine

Andrew A. Irvine Fulfills Fulbright U.S. Scholar Grant to Ecuador in Environmental and Natural Resources Law

At the end of April 2017, Andrew A. Irvine fulfilled his Fulbright U.S. Scholar grant to Ecuador in environmental and natural resources law and returned to his law practice in the United States. The Fulbright U.S. Scholar project involved the design and implementation of a study if illegal and informal artisanal and small-mining (“ASM”) in Ecuador, focusing first on Ecuador’s legal framework regulating ASM and then researching implementation of the law at ASM operations and mineral processing plants across the country. A significant portion of the project involved working with government officials, mining companies, and environmental and community organizations to identify and evaluate mining-related environmental and social problems, understand the causes of the problems, and work collaboratively to design and implement solutions to the problems.

A family of artisanal miners pans for gold on the banks of the Río Jatunyacu.

A family of artisanal miners pans for gold on the banks of the Río Jatunyacu.

The primary case study for the project concerned a mining site on the Río Jatunyacu in Ecuador’s Amazon region. Following investigation of the site, including detail of the resultant environmental impacts, research on the government’s permitting of the mine and subsequent monitoring and enforcement of environmental requirements was conducted. Then, the effects of the permitting and environmental management processes were analyzed, and recommendations were provided for improvements to the legal regime for ASM and its implementation by the government and local communities. Promoting best management practices amongst miners and building institutional capacity within the government and affected communities to monitor and enforce the mining law were determined crucial to the success of ASM regulation in Ecuador.

Another "artisanal" mining operation on the Río Jatunyacu.

Another “artisanal” mining operation on the Río Jatunyacu.

Following completion of his research, Mr. Irvine prepared an extensive report presenting and analyzing Ecuador law on ASM, discussing the effects and shortcomings of the law, and providing recommendations to improve effectiveness of the law, reduce illegal mining activity and better protect the natural environment. He presented his report on “Artisanal and Small-Scale Mining in Ecuador—Building and Implementing an Effective Legal Framework” at the Rocky Mountain Mineral Law Foundation Special Institute on International Mining and Oil & Gas Law, Development and Investment in Quito, Ecuador in April 2017. The report was first published with the proceedings of the Special Institute.

The abstract of the report is provided below. A copy of the report is available here:  Artisanal and Small-Scale Mining in Ecuador–Building and Implementing an Effective Legal Framework.

Community members panning for gold under precarious conditions.

Community members panning for gold in active mine.

Abstract:  Mining industries in Latin America and across the world are often dominated by artisanal and small-scale mining (“ASM”) operations, which are marred by myriad health, social, economic, and environmental problems. Even with significant economic and social contributions, these operations are often considered illegal because they operate informally, outside legal frameworks. While approaches to addressing problems resulting from ASM have varied, scholars recognize that legalization of ASM is a fundamental condition for a legitimate, stable and responsible ASM sector.

More unregulated mining operations along the Río Jatuyacu.

More unregulated mining along the Río Jatuyacu.

 

New mining legislation in Ecuador provides for the regularization of ASM in an attempt to combat illegal mining in the country and solve many of the resultant problems. The impact of the new law on illegal mining, however, has been limited. With respect to gold laundering, the law may actually be contributing to this illegal activity rather than reducing it.

Uncontrolled sedimentation from mining operations entering the Río Jatunyacu.

Uncontrolled sedimentation from mining operations entering the Río Jatunyacu.

 

 

This paper provides an overview of the prevalence of illegal mining in Latin America and discusses the attendant problems, with a focus on Ecuador. Ecuador’s law formalizing ASM is then presented and analyzed in the contexts of its contribution to gold laundering in the country and degradation of a popular river in Ecuador’s “whitewater capital.” The law’s effects on mercury reduction and the coexistence between ASM and large-scale mining in Ecuador are also discussed. Based on these analyses, recommendations are made to improve the effectiveness of Ecuador’s new mining law, both to reduce illegal mining activity in the country and to better protect Ecuador’s natural environment. Overall, enhancement of Ecuador’s legal framework for ASM is intended to contribute to the advancement of ASM as a formalized, socially and environmentally responsible means of livelihood in the country.

Trefren Construction Wins Significant Victory in Wyoming Supreme Court

On December 20, 2016, the Supreme Court of Wyoming issued an opinion in favor of Trefren Construction Co. in Trefren Construction Co. v. V&R Construction, LLC et al., 386 P.3d 317, 2016 WY 121 (Wyo. 2016). The opinion is available here. Andrew A. Irvine, P.C, represented plaintiff-appellant Trefren Construction.

Trefren Construction appealed the District Court of Lincoln County’s denial of its motion to amend its complaint and substitute the real party in interest, as well as the District Court’s grant of summary judgment to Defendants-Appellees, V&R Construction, LLC, and Cocca Development, Ltd. Upon review, the Supreme Court found “the district court erred in dismissing the complaint for lack of subject matter jurisdiction, abused its discretion in denying the motion to substitute, and erred in prematurely ruling on the merits of the parties’ contract claims.” Trefren Construction Co., 386 P.3d at 318. As a result, the Supreme Court reversed the district court’s decision and remanded the case for further proceedings in accordance with its opinion. Also, on January 24, 2017, the Supreme Court awarded costs to Trefren Construction and issued a mandate reversing the district court’s decision.

The Supreme Court’s opinion is especially significant with respect to the application and scope of W.R.C.P. Rule 17(a) concerning the real party in interest, but the Court’s opinion is also significant with respect to application of Rule 15(a), concerning the amendment of a complaint, and Rules 21 and 25 concerning the substitution of parties.

Trefren Construction filed its complaint in the district court against V&R Construction and Cocca Development on September 19, 2014 to collect amounts owed by V&R and Cocca for work completed by Trefren Construction on a new Shopko store in Afton, Wyoming. Id. at 319. V&R and Cocca filed and answer and the litigation proceeded through discovery. Id. During discovery, however, on April 23, 2015, Mr. Timothy N. Trefren, the owner of Trefren Construction, died after a long battle with cancer. Id. at 318, 321.

At some point following Mr. Trefren’s death, V&R and Cocca discovered that Mr. Trefren had operated Trefren Construction as a sole proprietorship and not as a Wyoming corporation as stated in Trefren Construction’s complaint. Id. at 319-20. As a result, immediately following an unsuccessful mediation and with a trial date scheduled for January 19, 2016, V&R and Cocca on November 20, 2015 filed a motion to dismiss the case, arguing that because Trefren Construction was not a valid Wyoming corporation when the complaint was filed, the case could not proceed because there was no real party in interest as plaintiff. Id. at 320.

Three days later, on November 23, 2015, Trefren Construction motioned the district court to substitute the Estate of Timothy Nelson Trefren as the real party in interest in the case, acknowledging that Trefren Construction Co. had been operated as a sole proprietorship and, as a result, the assets and liabilities of Trefren Construction had been transferred to the Estate, thereby making the Estate the new real party in interest. Id. V&R and Cocca opposed substitution of the Estate and requested that the district court vacate the scheduled trial date and order further briefing on V&R and Cocca’s motion to dismiss. Id. at 320-21.

Through further briefing, Trefren Construction argued that “whether viewed singularly or in combination, [W.R.C.P.] Rules 17(a), 21, 25 and 15(a) ‘readily allow the substitution of The Estate of Timothy N. Trefren as the real party in interest in this case.’” Id. at 321. Meanwhile, V&R and Cocca argued that they would be prejudiced if the case proceeded with the Estate as the real party in interest. Id.

In reviewing the parties’ briefs, the district court did not address Trefren Construction’s arguments that substitution of the Estate was proper under Rules 17(a), 21 and 25(c). Instead, the district court focused solely on Rule 15(a) concerning amendment of a complaint and Rule 25(a) concerning substitution upon the death of a party. Id. The district court deemed Trefren Construction’s motion to amend its complaint untimely and further determined that amendment would not serve the interests of justice. Id. In addition, focusing on Trefren Construction as a Wyoming corporation and not as a sole proprietorship, the court found Rule 25(a) inapplicable because no party to the action had died. Id.

With respect to the real party in interest question, the district court found that because there was no existing Wyoming corporation by the name of Trefren Construction Co., the named plaintiff was a non-existent entity and could not be the real party in interest. Id. at 322. The district court concluded that because the named plaintiff was not the real party in interest, the complaint had to be dismissed for lack of subject matter jurisdiction. Id. The court then turned to an analysis of the enforceability of the parties’ contracts and determined that because Trefren Construction Co. was named in the contracts and was not, in fact, a Wyoming corporation, the contracts were voidable. Id.

On February 9, 2016, the district court entered an Order Denying Motion for Substitution of Party, Denying Motion for Leave to Amend Complaint, and Granting Defendants’ Motion for Summary Judgment. Id. at 321. Trefren Construction timely appealed the district court’s order. Id. at 322.

On appeal, Trefren Construction argued that the district court’s ruling, which suggested that dismissal must follow when an action is not brought in the name of the real party in interest, was contrary to the plain terms of Rule 17(a). Id. at 325. The Supreme Court agreed. Id. The Supreme Court recognized, “Rule 17(a) directs that ‘[n]o action shall be dismissed on the ground that it is not prosecuted in the name of the real party in interest until a reasonable time has been allowed after objection for ratification of commencement of the action by, or joinder or substitution of, the real party in interest.’” Id. (citing W.R.C.P. 17(a)). Thus, the Supreme Court concluded, “not only does Rule 17(a), but its plain terms, not mandate dismissal when an action is not prosecuted in the name of the real party in interest, but it expressly requires the opposite—that the court allow a reasonable time to cure the defect through ratification, joinder or substitution.” Id.

The Supreme Court further stated, the fact the named plaintiff (Trefren Construction) was not a Wyoming corporation with the capacity to sue at the time it filed its lawsuit against V&R and Cocca “had no bearing on the requirement that a reasonable time be allowed for substitution.” Id. Substitution remained “an available mechanism to cure the defect in naming the real party in interest.” Id. As a result, based on the plain terms of Rule 17(a), and further analysis of related federal case law, the Supreme Court held, “Rule 17(a) did not mandate dismissal.” Id.

Next, the Supreme Court considered the “district court’s determination that dismissal was required because the real party in interest requirement is jurisdictional.” Id. The Supreme Court recognized that, in conflict with Rule 17(a), previous cases had held that the real party in interest requirement was jurisdictional. Id. (citations omitted). More recent cases, however, suggested that the requirement was not jurisdictional. Id. (citations omitted). The Supreme Court resolved this conflict by holding, consistent with the Court’s more recent decisions, “that the real part in interest requirement is not jurisdictional.” Id. The Supreme Court specifically overruled the previous cases holding otherwise. Id. at 326.

Having determined that neither Rule 17(a) nor jurisdictional limits mandated dismissal of Trefren Construction’s complaint, the Court next addressed whether the district court abused its discretion in denying Trefren Construction’s motion to substitute the real party in interest. Id. at 326. Because Trefren Construction invoked Rule 17(a) to substitute the Estate of Timothy N. Trefren, in addition to Rules 15, 21 and 25, and “Rule 17 is the controlling rule with respect to a real party in interest analysis,” the Supreme Court first reviewed the district court’s Rule 17 ruling rather than the district court’s rulings on Rules 15 and 25. Id. at 326-27.

First, the Supreme Court reviewed the district court’s finding that “[t]he time that has lapsed from when this action was filed until mediation failed and the motion to dismiss or for summary judgment was filed was more than a reasonable amount of time for the real party in interest to ratify, join, or seek substitution as the Plaintiff in this matter pursuant to Rule 17.” Id. at 327. With respect to the timeliness of Trefren Construction’s motion to substitute, the Supreme Court agreed with Trefren Construction’s argument that the district court measured the delay in filing the motion to substitute from the wrong date. Id.

 The Supreme Court provided, “Rule 17(a) requires that an action not be dismissed ‘until a reasonable time has been allowed after objection’ for substitution of the real party in interest.” Id. (citing W.R.C.P. 17(a) (emphasis in original)). As result, the Supreme Court held that the district court erred “in measuring the delay from the date the action was originally filed, rather than from the date on which [V&R and Cocca] made their real party in interest objection.” Id. The properly measured delay of three days from the time V&R and Cocca made their objection (November 20, 2015) until Trefren Construction filed its motion to substitute (November 23, 2015) “was not unreasonable.” Id.

Second, the Supreme Court considered whether Trefren Construction’s naming of the plaintiff was an “honest mistake” and whether V&R and Cocca would be prejudiced by substitution. Id. at 327-28. The Court found that there was no evidence that Trefren Construction’s naming was anything but an “honest mistake,” and, further, there was no showing of prejudice. Id. The Supreme Court noted that upon substitution of the Estate, the case would remain the same in most particulars and any necessary additional discovery or amendments to pleadings could be readily handled by the district court. Id. at 328. The Court thus concluded, “the district court abused its discretion under Rule 17(a) when it denied Trefren Construction’s motion to substitute the Estate as the real party in interest.” Id.

 Finally, with regard to the district court’s grant of summary judgment on contract enforceability, the Supreme Court found the district court’s ruling fundamentally flawed because V&R and Cocca had not even moved for summary judgment “on the ground that the parties’ contracts were voidable and they submitted no evidence on that question.” Id. at 329. In following, “Trefren Construction had no notice that a claim that the parties’ contracts were voidable would be considered by the district court as a basis for entering an order of summary judgment in favor of [V&R and Cocca].” Id. V&R and Cocca did not make a prima facie showing that the parties’ contracts were voidable and Trefren Construction was under no obligation and “had no opportunity or reason to submit evidence defending against an allegation that it represented itself as a corporation during contract negotiations.” Id. 329. Based on these findings, the Supreme Court held, “[t]he district court’s summary judgment ruling that the contracts were voidable, was thus procedurally infirm and unsupported by a showing of undisputed material facts.” Id.

In conclusion, the Supreme Court provided: “[w]e concluded that the district court erred in dismissing the complaint for lack of subject matter jurisdiction, and in so ruling, we overrule our prior decisions holding that the real party in interest requirement is jurisdictional. We further conclude that the district court abused its discretion in denying Trefren Construction’s motion to substitute and erred in granting summary judgment to [V&R and Cocca] on the enforceability of the parties’ contract claims.” Id. The Supreme Court reversed the district court’s order and remanded the case for proceedings in accordance with the Court’s holdings. Id. As a result, the case is again before the District Court of Lincoln County, and Trefren Construction is allowed to proceed in collecting the amounts owed by V&R and Cocca.

Forest Service Approves Honeycomb Mine Project in Utah

On May 12, 2016, the United States Forest Service published the final decision and finding of no significant impact for the Honeycomb Mine Project. The decision approves the plan of operations submitted by Ameri-can Onyx, LLC for continued open pit mining of “honeycomb onyx” (a type of calcite) at the Honeycomb Mine. Andrew A. Irvine, P.C., represents Ameri-can Onyx and handled all legal matters concerning claim location, environmental analysis, and state and federal permitting.

The mine is located high in the Uinta Mountains, at an elevation of approximately 10,600 feet, on the Duchesne Ranger District of the Ashley National Forest Honeycomb Mine Pic 1near Hanna, Utah. Mining operations are proposed to average 3,000 tons of calcite per year, with a maximum of 6,000 tons per year, for an estimated period of 10 to 15 years. Because of the high elevation and associated seasonal snowfall, mine operations will generally be limited to a period between June and November of each year. The proposed project area is approximately 10 acres in size, but with concurrent reclamation of areas no longer needed for active mining, there would be no more than 2.5 acres of active disturbance at any given time. More information on the Forest Service’s decision and the planned operations at the mine can be found here.

“Honeycomb onyx” is also known as “calcite onyx,” “honeycomb calcite,” and “amber onyx,” among other names. Calcite from this area in Utah is a translucent calcite with a honey or orange color and is similar to marble and travertine in strength and other traits. The stone is used for counter tops, wall tiles, other home and building uses, as well as for carvings, artwork and jewelry

Ameri-can Onyx faced numerous legal challenges leading to Honeycomb Mine Pic 2mine approval, starting with litigation against Shamrock Mining Associates, LLC over disputed mining claim locations. Shamrock failed to pay maintenance fees on certain claims covered by the Honeycomb Mine area. As a result, Ameri-can Onyx’s predecessor located claim
s on the lands open to location and negotiated a favorable settlement agreement with Shamrock to gain complete ownership of the Honeycomb Mine. Ameri-can Onyx then developed and submitted a new plan of operations for the mine to reclaim past operations and develop new operations. The plan of operations was successfully ushered through the Forest Service’s NEPA process, leading to the recent final decision and finding of no significant impact. Mine operations are set to begin at the Honeycomb Mine this summer.

Andrew A. Irvine Receives Fulbright Award

Andrew A. Irvine of Andrew A. Irvine, P.C. has been offered a Fulbright U.S. Scholar Program grant to Ecuador in environmental and natural resources law the United States Department of State and the J. William Fulbright Foreign Scholarship Board announced recently.  The Press Release concerning Irvine’s award can be found here:  Fulbright-Press-Release.  The Abstract for Irvine’s proposed research project “Implementing an Effective Legal Framework to Eliminate Illegal Mining in Ecuador” is presented as follows:

Abstract:  The absence of legal frameworks governing artisanal and small-scale mining (ASM) results in illegal mining operations plagued by economic, social, health, and environmental problems.  New legislation in Ecuador regulating ASM provides the framework to solve these problems, but the law’s practical impact has been limited.  By researching implementation of the new law, this project will determine the reasons the impact has been limited and recommend actions to improve the law and its implementation.  The goal is to build an effective legal framework in Ecuador to protect, educate, and train ASM workers, and enable ASM to be a path out of poverty.  On a global scale, this framework could be used as a template for other countries to establish ASM as a safe, healthy, and environmentally responsible means of livelihood.

Dino Mine? Who says? Are Dinosaur Fossils considered “Minerals” in Colorado?

This fall I received a call from a client requesting urgent advice concerning the State of Colorado’s authority to regulate the excavation of dinosaur fossils on private land within the State.

My client has a small dinosaur quarry on his private land in Colorado, where he and family spend summers digging up dinosaur fossils. Although my client had been digging up fossils for years, the State of Colorado Division of Reclamation, Mining and Safety (“DRMS”) suddenly informed my client that they suspected he was running an “illegal mining operation,” i.e., a mining operation that had not received a mining and reclamation permit from the DRMS. In response, the DRMS informed my client that they would be inspecting his dinosaur quarry for compliance purposes.

Upon hearing this news, I contacted the DRMS to discover what authority they were acting under. The State of Colorado Attorney General’s Office returned my phone call and exclaimed that the DRMS had authority to conduct inspections of fossil excavation sites on private land and, after inspection, the DRMS would determine the need for a mining and reclamation permit for my client’s dinosaur quarry. The Attorney General’s Office also threatened to go to court to get a warrant for the inspection if my client did not provide the DRMS immediate access.

Again, I asked what authority the DRMS was acting under. The Attorney General’s Office stated that the legal authority for the DRMS to inspect my client’s dinosaur quarry could be found at Colo. Rev. Stat. § 34-32-121.

Colo. Rev. Stat. § 34-32-121 concerning “[e]ntry upon lands for inspection” provides, “[t]he board, the office, or their authorized representatives may enter upon the lands of the operator at all reasonable times for the purpose of inspection to determine whether the provisions of this article have been complied with.”

This statute convinced the Attorney General’s Office that the DRMS had legal authority to inspect my client’s private land. Further analysis indicates otherwise.

To start, what are “lands of the operator”? The term “operator” is defined at Colo. Rev. Stat. § 34-32-103(10) as “any person, firm, partnership, association, or corporation, or any department, division, or agency or federal, state, county, or municipal government engaged in or controlling a mining operation.”

Okay, so what is a “mining operation”? Under Colo. Rev. Stat. § 34-32-103(8) “mining operation” means “the development or extraction of a mineral from its natural occurrences on affected land.”

Finally, what is a “mineral”? According to Colo. Rev. Stat. § 43-32-103(7) a “mineral” is “an inanimate constituent of the earth in a solid, liquid, or gaseous state which, when extracted from the earth, is useable in its natural form or is capable of conversion into a useable form as a metal, a metallic compound, a chemical, an energy source, or a raw material for manufacturing or construction material.”

Under this definition, dinosaur fossils are not “minerals” because they are not “useable . . . as a metal, a metallic compound, a chemical, an energy source, or a raw material for manufacturing or construction material.” Rather, dinosaur fossils are used for scientific research, museum collections and, occasionally, private collections.

Analysis of the DRMS’ legal authority indicates that dinosaur fossils are not “minerals.” In following, “mining operation(s)” do not include the excavation of dinosaur fossils. As a result, a person engaged in excavating dinosaur fossils is not an “operator.” In turn, the lands where such excavation is taking place are not “lands of the operator.” So, after further analysis, Colo. Rev. Stat. § 34-32-121 concerning “[e]ntry upon lands for inspection” does not provide legal authority for the DRMS to inspect a dinosaur fossil site on private land in Colorado.

Similarly, because the excavation of dinosaur fossils does not constitute a “mining operation,” a mining and reclamation permit is not required from the DRMS. “Reclamation permits” are only required for “mining operations” under Colo. Rev. Stat. § 34-32-109.

As this example shows, when land and mineral owners are approached by companies, government agencies, or others purporting to have certain authority over their private property, it is important to investigate that authority.

Often times, companies and others are not providing the full story or are misstating their authority, particularly in the case of mineral development on private property. Sometimes, government agencies are misinformed about their own authority, as in the example above.

Thus, I advise property owners to get informed about their rights before succumbing to the demands of companies, government agencies, or others wanting to enter, inspect or develop their private property.

North American Packgoat Association Files Motion for Contempt Against the Forest Service

On June 24, 2015 the North American Packgoat Association (NAPgA), together with the Idaho Wool Growers Association (IWGA), filed a motion in the United States District Court for the District of Idaho for an order holding the United States Forest Service in contempt of court. The motion is related to the Forest Service’s recent decision to prohibit goatpacking on the Shoshone National Forest in northwestern Wyoming. In reaching such decision on the Shoshone National Forest, the Forest Service appears to have relied on the findings and conclusions of two bighorn sheep science committees—the Payette RADT and Payette Principles Committees—that were established and utilized by the Forest Service on the Payette National Forest in Idaho. Because these committees were established and utilized in violation of the procedural mandates of the Federal Advisory Committee Act (FACA), the IWGA sued the Forest Service in the United States District Court for the District of Idaho in 2008 seeking to have the committees declared unlawful and to prohibit the Forest Service’s use of the committees’ reports. The Court ruled in favor of the IWGA and ordered the Forest Service not to rely upon the findings and conclusions of the Payette RADT and Payette Principles Committees in reaching future agency decisions. The committees lacked public participation, including participation by members of the IWGA and NAPgA, and, as a result, the findings and conclusions of the committees were uninformed and biased.

Despite the clear order of the United States District Court for the District of Idaho, the Forest Service on the Shoshone National Forest appears to have relied on the illegal Payette RADT and Payette Principles Committee reports. Indeed, these reports are directly cited in the Shoshone National Forest’s own “Risk Analysis of Disease Transmission between Domestic Sheep and Goats and Rocky Mountain Bighorn Sheep” (Shoshone RADT Report). As the Forest Service’s use of the uninformed and biased findings and conclusions of the Payette RADT and Payette Principles Committees on the Shoshone appears to be a violation of the Court’s order in Idaho, NAPgA has teamed up with the IWGA to seek enforcement of the Court’s order against the Forest Service. This action takes place in Idaho because that is where the IWGA originally filed its lawsuit. If successful, however, the IWGA and NAPgA are requesting that the Shoshone RADT Report be thrown out as it improperly relies upon the Payette RADT and Payette Principles Committee reports. If the Shoshone RADT Report is thrown out, the Forest Service will likely have to reconsider its decision to prohibit goatpacking on the Shoshone National Forest, as the Shoshone RADT Report provided the so-called “scientific” basis for that decision.