Wilkinson v. Bd. of University and School Lands of the State of N.D., 981 N.W.2d 853

Background

Plaintiffs are successors to owners who, in 1958, conveyed surface to the U.S. (Garrison Dam project) but reserved oil and gas rights; they leased those minerals (notably in 2009).
The North Dakota Land Board separately leased portions of the same quarter sections in 2010–2011; production from the Lippert spacing unit began in 2010.
A title dispute over mineral ownership in Sections 12 and 13 produced litigation beginning in 2012; Statoil suspended some royalty payments and escrowed Land Board royalties at the Bank of North Dakota.
The district court originally granted summary judgment to the State; this court’s decisions in Wilkinson I and Wilkinson II narrowed the State’s sovereign-lands claims and concluded the disputed minerals were above the historical OHWM and belonged to the plaintiffs.
After Wilkinson II the escrowed royalties were released and Statoil paid plaintiffs $571,094 in outstanding royalties (Nov. 2020). The district court later dismissed plaintiffs’ remaining claims (conversion, takings, unjust enrichment, civil conspiracy, § 1983) and denied fees; plaintiffs appealed.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Conversion claim subject-matter jurisdiction (notice-of-claim)	Wilkinson: conversion is not an "injury" requiring OMB notice; claim should proceed.	State: N.D.C.C. § 32-12.2-04(1) required a timely notice to OMB; absence deprives court of jurisdiction.	Held: Dismissed for lack of jurisdiction—conversion is a tort/injury and plaintiffs failed to file required OMB notice.
Civil conspiracy (State and Statoil)	Wilkinson: State and Statoil agreed to withhold/convert royalties; conspiracy caused damage.	State/Statoil: No underlying tort (takings not a tort); escrow and leasing were lawful and per rule; the tort claim is barred by lack of notice.	Held: Dismissed—no actionable underlying tort against State (and no proof of unlawful concerted act by Statoil).
Takings (temporary physical or total regulatory; escrow interest)	Wilkinson: State leasing of disputed minerals and withholding/escrow of royalties was a temporary physical taking (and deprived use/value), entitling them to just compensation and interest.	State: Leases were quitclaim-like (no title warranty), lawful nominations/auctions, escrow required by rule; plaintiffs continued to lease and ultimately received royalties—no physical or total regulatory taking.	Held: Dismissed—no per se physical taking or total regulatory taking; escrow and suspension under statute/rule do not amount to a taking under these facts.
Unjust enrichment and attorney’s fees (§ 1983/1988, N.D.C.C. ch. 32-15)	Wilkinson: Land Board was unjustly enriched by keeping bonus payments on expired Section 13 leases; prevailed on constitutional claims so seek fees.	State: Bonus retention is industry practice; plaintiffs were not impoverished; plaintiffs did not prevail on takings or § 1983 claims.	Held: Dismissed—no unjust enrichment (no impoverishment or inequitable retention); fees denied because plaintiffs did not prevail on constitutional claims.

Key Cases Cited

Wilkinson v. Bd. of Univ. & Sch. Lands, 903 N.W.2d 51 (N.D. 2017) (reversed aspects of summary judgment; held statutory process may govern Missouri riverbed/mineral ownership)
Wilkinson v. Bd. of Univ. & Sch. Lands, 947 N.W.2d 910 (N.D. 2020) (affirmed that disputed minerals were above OHWM and not sovereign lands; remanded for unresolved issues)
Lingle v. Chevron U.S.A. Inc., 544 U.S. 528 (takings framework; distinguishes physical and regulatory takings)
Lucas v. S.C. Coastal Council, 505 U.S. 1003 (per se total regulatory takings where all economically beneficial use is lost)
Cedar Point Nursery v. Hassid, 141 S. Ct. 2063 (physical appropriation and right to exclude analysis)
Arkansas Game & Fish Comm’n v. United States, 568 U.S. 23 (post-action remedy cannot eliminate a prior taking; takings compensation principles)
Central Pines Land Co. v. United States, 107 Fed. Cl. 310 (government leasing of disputed minerals can, in some circumstances, constitute a temporary taking if it denied owners’ benefits)
Yuba Goldfields, Inc. v. United States, 723 F.2d 884 (government assertion of title and related conduct may support taking when it prevents owner’s use)
Ghorbanni v. N.D. Council on Arts, 639 N.W.2d 507 (N.D. 2002) (notice-of-claim statute applies to tort-like claims against the State)
Wild Rice River Estates, Inc. v. City of Fargo, 705 N.W.2d 850 (N.D. 2005) (takings standards and review principles)