Clay v. Mountain Valley Mineral Ltd. Partnership, 351 P.3d 961

In 1974–75 Art and Hope Sims (predecessors to Mountain Valley) acquired record title to the surface of a Converse County parcel while prior owners reserved mineral interests; by 1975 mineral ownership was Walters 60%, Shepherd/Hoppes 20%, Energetics 20%.
The Sims filed a quiet title/adverse possession complaint in 1976 naming mineral owners (except Energetics); most defendants (including the Clays' predecessors) defaulted and the court entered a broad decree quieting title in the Sims "to said real property" and declaring defendants had no interest "whatsoever."
The Sims leased minerals shortly after the 1976 decree; title later passed to Mountain Valley, which sued in 2013 for declaratory relief asserting it owns 80% of the minerals by virtue of the 1976 judgment.
The Clays sued to assert mineral interests derived from Walters and Stire and argued (1) the 1976 decree addressed only the surface and thus did not preclude their mineral claims, and (2) laches should bar Mountain Valley because it delayed asserting rights until minerals gained value.
The district court granted summary judgment for Mountain Valley, holding the 1976 default judgment quietly vested the Sims (and successors) with fee title including the mineral interests (except Energetics’ 20%), and res judicata bars the Clays; the Clays appealed.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Res judicata effect of 1976 quiet title decree over mineral interests	Clays: decree limited to surface; severed minerals were not adjudicated so mineral claims survive	Mountain Valley: decree was broad, named mineral owners, and defaulted defendants are precluded from relitigating mineral title	Court: Held res judicata applies — the unambiguous default decree quieted title to surface and 80% of minerals in Sims/Mountain Valley
Applicability of laches	Clays: Mountain Valley waited until minerals were valuable, so laches should bar its claim	Mountain Valley: predecessor sued in 1976 and obtained judgment then; no inexcusable delay to acquire title	Court: Held laches does not apply because rights were asserted in 1976 and judgment was obtained then

Spitzer v. Spitzer, 777 P.2d 587 (Wyo. 1989) (default admits material allegations and operates as confession of facts supporting judgment)
Barrett v. Town of Guernsey, 652 P.2d 395 (Wyo. 1982) (purpose of quiet title is to resolve all adverse claims and create a stable muniment of title)
State ex rel. Cross v. Board of Land Commissioners, 58 P.2d 423 (Wyo. 1936) (adverse possession of surface may include minerals when estates are consolidated)
Ohio Oil Co. v. Wyoming Agency, 179 P.2d 773 (Wyo. 1947) (to adversely possess a severed mineral estate, claimant must show actual mineral operations)
Crain v. Farmers United Cooperative Pool, 472 P.2d 882 (Okla. 1970) (default in quiet title where mineral owner was named bars later collateral attack on mineral title)