Hecla Mining Co. v. Star-Morning Mining Co.

HECLA MINING COMPANY Partnership,

Bunker Limited Plaintiff-Respondents, COMPANY, MINING STAR-MORNING Defendant-Appellant.

No. 19019. Idaho, Supreme Court Boise, April 1992 Term.

Aug. summary judgment and remand this proceed-

case the trial court for further

ings remaining on the claims.

I. AND THE BACKGROUND PRIOR PROCEEDINGS. (Hecla) Mining Company Hecla and (Bunker) Partnership Bunker Limited each an interest owned undivided Star- (the mine). (Hecla Morning Mine and will to as Bunker be referred Hecla unless indicated). In otherwise Star-Morn- (Star) ing Mining Company entered lease (the lease) agreements and rental par- to the mine. the Hecla lease provide 1984 lease ties amended the to that could terminate the lease written Hecla operations suspended if notice were for twelve consecutive months. mine, began operating the but

Star was payments. unable meet lease down in the mine was shut fall negotiated parties opera- to continue During August Hecla sent a tions. (the draft) d’Alene, proposed modified lease Nixon, Lay- W.W. Coeur Wash., September On Hecla noti- man, Loft, White, Star. Arpin Spokane, & fied that the 1984 lease was terminat- Star-Morning Min. Co. John appellant, for in signed ed. 1987 draft Decem- Spokane, Layman argued, Wash. R. re- ber 1988. Hecla then declined Star’s Keane, Koontz, Evans, Boyd, Simco & sign quest to the 1987 draft. Kellogg, respondent, Hecla Min. Ripley, for 1989, seeking: in filed this lawsuit Co.; Davenport Hecla Witherspoon, Kelley, & (1) declaratory judgment that the 1984 Toole, Wash., respondent, for Spokane, $527,841.80 terminated, (2) Gibler, lease was M. Partnership. Ltd. Fred Bunker (3) declaratory past-due payments, lease argued. Kellogg, judgment draft was not claims, effect, (4) JOHNSON, quiet against title Star’s Justice. (5) damages resulting from the loss of case in which the trial This is a contract mine. the sale summary judgment. granted partial parties had modified the trial court Star asserted address whether We first Among the 1987 draft. partial summary the 1984 lease with certified properly things, rescheduled pursuant the 1987 draft judgment other judgment as final Hecla under Star owed 54(b). payments that the certi- the lease conclude I.R.C.P. We Star also asserted primary issue the 1984 lease. proper. The fication was conduct caused statements and admissible evi- Hecla’s presented whether rely 1987 draft justifiably to motion Star opposition dence submitted Hecla’s contended that its detriment. Star summary was sufficient to judgment for waiver conduct constituted con- statements and of material fact genuine issues raise payments timely equita- right Hecla’s waiver cerning the defenses estopped lease and the evidence under conclude estoppel. We ble Therefore, denying the effectiveness affirm from we not sufficient. was (1) seeking: a When more than one claim for Star counterclaimed relief is draft. action, presented 1987 draft in an declaratory judgment whether as a $20,000 claim, counterclaim, effect, (2) cross-claim, for Hecla’s or third was lease, claim, party multiple of the 1984 or when wrongful termination $550,000 involved, (3) damages of Hecla's may entry because the court direct the buyer produce judgment for Star’s ore as upon failure to of a final one more parties’ marketing required parties only less than all of the claims or agreement. express an determination that there just delay is no reason for partial summary judg- Hecla moved express entry direction for the seeking declaratory judgment ment judgment. properly lease was terminated and the 1984 the 1987 draft was not effect. recently applicability We addressed the 54(b) anof I.R.C.P. certification in Thorn by Jay Lay- an Star submitted affidavit Bonz, Creek Cattle Ass’n v. 122 Idaho man, operations manager, opposing Star’s (1992). Creek, In Thorn the summary judgment. motion for Hecla’s action, held that in a Court foreclosure the argument summary During oral on the liability deficiency aspects were of the motion, attorney objected judgment Hecla’s 54(b) same claim and that an I.R.C.P. certi some of the evidence asserted the “to [in improper. fication was Id. at 830 P.2d Jay Layman] grounds affidavit of on the at 1183. conclusory it’s and no foundation.” attorney gave example Hecla’s then an distinguishable This case is from Thorn carefully asked the court to consider the past-due pay Creek. The claim for lease Jay Layman affidavit because it contained separate ments is from Hecla’s claims that incompetent some evidence. Star did not have a leasehold interest in the granted partial summary The trial court mine based on either the 1984 or the lease Hecla, judgment stating to that affidavits delinquent 1987draft. Star owed the lease by parties conclusory submitted the were Hecla, payments regardless of whether specificity required by the and lacked the 1984 lease had terminated. Al been 56(e). I.R.C.P. On the of facts the basis though pay the 1987 draft rescheduled the undisputed, trial court said were the trial delinquent payments, ment of the (1) properly decided: court Hecla terminat- liability delinquent payments for the arose lease, (2) accept ed the 1984 Hecla did not lease, out of the 1984 not the 1987 draft. draft, (3) of the terms 1987 Star claim, quiet As to Hecla’s title the declara no leasehold had interest the mine. Star tion that did not have a leasehold 54(b) moved for an I.R.C.P. certification mine, effect, quieted interest title final, partial judgment that the which was against Star as to interest in the mine. granted. the court requested damages Hecla also due to the loss of If a sale of mine. this were

II. merely request damages a for aas coinci- part dent of the declaration of the termi- 54(b) THE I.R.C.P. CERTIFICATION nation of the 1984 lease and the ineffective- WAS PROPER. draft, ness of the 1987 an award would Although present did not jurisdiction have been within the appeal on the issue of whether the trial Sweeney trial court. v. American Nat’l partial judg properly certified the 544, 550-51, Bank, 62 Idaho 115 P.2d 54(b), under ment as final I.R.C.P. event, (1941). In that we would have propriety certi questioned Court of the that there had not a full concluded been argument. oral Because this is fication at declaratory adjudication judgment jurisdictional question, a we first must re claims, and we would have concluded solve the certification. our concerns about judgment pursuant the certification of final 54(b) states, 54(b) improper. was part: I.R.C.P. to I.R.C.P. however, alleged Hecla ment because the affidavit of complaint,

In the signed when Star in opposi- in December and documents submitted draft, intend- the 1987 Hecla returned tion to Hecla’s motion contain admissible purchaser. mine to a Hecla sell ed to genuine raise evidence that issues of mate- purchaser plans alleged (1) concerning: rial fact whether Hecla mine, mining operations at the commence lease, right rely on the 1984 waived purchaser was not able to but that (2) equitably estopped whether financing, which was a condition of obtain terminating the 1984 lease. dis-We sale, the claims “because [Star] agree with Star’s assertions. interest [mine].” Bischoff, v. 78 Idaho Crouch apparent- damages request This (1956), P.2d the Court defined waiver: of title claim. See ly slander based A is the intentional relinquish- waiver 758, 760, Harris, 98 Idaho Matheson right. voluntary ment of a known It is a (1977). There is further evi- P.2d implies party act and election damages record that the re- dence something dispense with of value or to A based on slander of title. quested were right forego advantage some secretary and treasurer from Star’s letter might party] party’s] option [the [the January which is Bunker dated upon. have demanded and insisted of Hecla’s to the affidavit secre- attached 368, (citations 649 304 P.2d at omit- Id. summary support in of the motion for tary ted). states: judgment, A party asserting must waiver have it Mining has advised us Co. the al acted reliance waiver and a of to continue as lessor does not wish position. party’s Corp. the tered Brand S mill because Mine and 734, 429, King, Idaho P.2d v. 102 639 Mine to hopes sell interest in the it to (1981). group. As have advised Hecla your we rights as a we retain lessee we believe equitable is Waiver doctrine that sale all or position and our is justice. The fairness and exis based subject the mine would be to portion of a ordinarily question tence waiver is a no rights objec- We have our as lessee. question of fact and is foremost a intent. to sale of Hecla’s interest tion to In order to establish waiver the intention long rights you to so our property clearly although may appear, waive must it respected. Dev. be established conduct. Riverside request appears Because it that Ritchie, v. Idaho Co. damages separate on a slander was based (1982). P.2d claim, damages and not as incident of title Equitable estoppel when a arises declaratory judgment, we conclude to or con party representation makes a false Therefore, separate claim. that this was a fact with actual or cealment of a material certification of final conclude that the we truth; is knowledge of the it 54(b) constructive was judgment pursuant to I.R.C.P. upon; it relied with the intent that made proper. asserting estoppel not know party does III. truth; and the or could discover it party asserting estoppel relies on IN LAYMAN AFFIDAVIT OF JAY THE party’s prejudice. Twin Falls Clinic & HECLA’S SUM- OPPOSITION TO Corp. Hamill, 103 Idaho Hosp. Bldg. DID MOTION MARY JUDGMENT (1982). 644 P.2d ISSUES OF NOT RAISE GENUINE MATERIAL FACT CONCERNING argues that trial first EQUITABLE OR ESTOP- WAIVER to consider not have refused court should PEL. Jay Layman’s affidavit without portions of There is no strike Hecla. motion to trial court a Star asserts requires mo- a summary authority in this state judg- granted not have should objection example couple places to strike or an before a trial is a tion may or not evidence affidavit there is a declaration exclude consider that we to, agreed, referring apparently party. plain a Absent or funda- offered [Star] Bunker], error, agreed we objection some form of mental [Hecla something. And there's no however, evidence of ordinarily necessary, preserve made, when the what it right challenge appeal the admis- was, present, who was and who said sion or consideration evidence. I.R.E. Otherwise, essentially, what to whom. 103(a)(1)(Error may predicated upon not be application we see this case as an of law ruling admits evidence unless a Really quibbled, to the facts. we haven’t right party substantial is affected [any] filed we haven’t counter affidavits objection timely or motion to strike quibbling with their factual assertions record, stating specific appears of they nor have with ours. ground objection.) 56(e) states: I.R.C.P. please. point If the court One on the 56(e). Rule Form of Affidavits— simply urge matter of facts is we testimony Further re- —Defense carefully the court to consider the affida- quired. Supporting opposing affida- — Jay Layman vit of for the reason I personal vits shall be made on knowl- mentioned, I just think there is some edge, shall set forth such facts as would incompetent evidence there and also be- evidence, be admissible and shall show if you compare cause the facts set forth affirmatively compe- that the affiant is key brief, in their affidavit with their we testify tent to the matters stated is, jibe. contend do not That asser- copies therein. Sworn or certified of all tions are made the brief that are not papers parts or thereof referred in an up by backed the affidavit. But affidavit shall be attached thereto court will—that will be evident to the served may permit therewith. court you study court when that. supplemented opposed affidavits to be or depositions, by interrogato- answers to In Evans v. Twin County, Falls ries, (1990), or further affidavits. When a mo- Idaho cert. de —nied, -, summary judgment tion for is made and U.S. S.Ct. rule, supported provided (1991), in as this an applied L.Ed.2d 1048 the Court party may 56(e) adverse upholding rest the in I.R.C.P. the trial court’s not allegations par- rejection mere or denials of oppo of an affidavit submitted in [the ty’s] pleadings, party’s] re- sition summary judgment to a motion for [the sponse, by pro- or by wrongful affidavits as otherwise the defendants in a death rule, specific in this surviving vided must set forth case. The affidavit was husband, showing genuine facts that there is a physician, stating who was not a for If party] proxi issue trial. adverse his belief that his wife’s death was [the respond, summary judgment, does not so mately caused the actions of the defen appropriate, against if shall entered rejected be dants. The trial court the affida “ evidence,’ party]. vit as ‘inadmissible it because [the ” testimony.’ was ‘not valid medical at Id. case, objected In this to the consid- 212, 796 P.2d at 89. presented eration of some the evidence hearing Jay Layman’s affirming rejection in affidavit. At the the trial court’s Evans, summary judgment, Hec- the affidavit in said: on the motion Court attorney la’s told the trial court: 56(e) Under Rule of the Idaho Rules of Procedure, dispute supporting the facts set forth in

We don’t Civil affidavits opposing summary judgment affidavits so far as the facts “shall [Star’s] competent personal knowledge, made on represent asserted evidence. however, object, And to some of the shall set forth such facts as would be we evidence____” grounds on the that The district evidence asserted admissible conclusory and no foundation. An court held that affidavit it’s [the husband’s] present,

containing opinion place, who nor lay his that events who said 15, 1987, what. April caused on wife’s] [his not best, months later was admis-

death eleven At the the Breidt affidavit indi- individually sible evidence. that he did cates not make any agents or its statement that [Star] Rules of Evidence Idaho Under July 1984 Lease Agreement 702, and the decisions of Rules 701 and terminated. would not be Grismer Court, has the trial court discretion this makes same statement and addition- lay determining to allow a whether position ally Secretary in his indicates opinion relating express witness person, that Art Brown was of Hecla causation. responsible Hecla “who was for mak- ing any agreement.” final Grismer addi- the trial court did not conclude that We tionally “I did intend states opinion concluding lay that the err made modification be whatsoever with- his death wife’s [the husband] approval out the consent of Bunker by the cardiac arrest was caused events Limited.” April was not admissible Jay Layman’s S. affidavit contains few prior I.R.E. 701 decisions under statements, it direct instead relies Appeals. of this Court and Court conclusory the uninformative and use of Accordingly, wrongful if there was participated nego- “we phrases such as pled, claim the trial court did not death plaintiffs ...”; tiations with the “Hecla dismissing it. err in ...”; immediately represented “[Star] 213-14, P.2d at 90-91. Id. at ”; orally communicated ... ”; agreed “All “We ... were pres The fact that the evidence ”; upon representa- “based aware ... opposition to support of or in ented plaintiff by representatives of tions summary judgment must be motions for ...”; ...” None and “Hecla indicated evidence, does not affect admissible provide kind of these statements court, this rule the trial Court ei- specific, admissible facts will review, liberally construe facts should support prevent entry ther of sum- nonmoving record in favor of the mary judgment. all reasonable inferences party and draw nonmoving record in favor of the from the that, in trial then concluded 752, Barnes, 121 Idaho party. Hoene v. effect, presented Star had Hecla and 756, (1992); 315, P.2d Pearson v. documents, specific upon the motion based 334, 338, Parsons, 114 757 P.2d Idaho in intro- by the trial court facts recited Durtschi, (1988); 110 Idaho Doe v. opinion, “specific, and four duction its (1986). The 469-70, 1241-42 716 P.2d undisputed, specific facts.” The material admissibility question of is threshold in by the court the intro- facts recited trial applying question to be answered before virtually opinion to its were taken duction in and reasonable the liberal construction in of support Hecla’s from brief verbatim evidence. rule to the admissible ferences The summary judgment. motion for its by stated the trial court additional fact one case, said in its In trial court this in that opinion to its was in the introduction for sum- opinion granting Hecla’s motion performed some ditch- the fall of Star mary judgment: flow changed water ing and J. Grismer affidavits of William The appears to have been tak- This fact mine. by Hecla submitted Frank J. Breidt and Jay Layman's affidavit. en from the affidavit support in of its motion and “specific, following four additional The by Layman Jay of S. submitted [Star] by were recited undisputed, facts” material general- to Hecla’s motion opposition court: the trial specificity ized, and lack the conclusory, meet- Jay numerous 56(e). Layman 1. by affidavits IRCP required of re- representatives Hecla ings with took a conversation do reflect when garding Environmental Act tion Protection of material fact needs to that be deter- problems. the trial mined court. of the summer Hank Alternatively, that Star asserts Hecla is specifically Jay Walde Hecla informed equitably estopped terminating Layman that there had been no discus- argues 1984lease. Star Hecla’s that denial or sion involvement with Bunker con- Layman Jay any dealings with Bunk- cerning entering into a or operating regarding leasing er mine to Bunker representa- the mine. Based on Walde’s clearly a representation upon false tions, nego- Star entered into settlement which Star relied and about Star Trading, tiations with Acme a creditor. could not discover the Star truth. contends Jay Layman told Frank Breidt that from Hecla’s it is clear actions Bunker of each his conversations with rely intended that Star Hecla’s on denial of marketplace. someone dealing regarding Bunker mine. represented Jay 4. Frank Breidt that rely Star states it did to its detriment by combining the concen- changed position and its particularly with and trates Bunker regard entering its negotia- settlement marketing power. have more tions with creditors. Essentially, dispute Star does not Jay We find much of the contents of opin- recited trial facts court in its Layman’s affidavit properly to be charac ion. Star contends that addition to these terized this Court characterized the evi facts the trial court should have considered opposition dence offered to a motion for Layman’s Jay

the contents of affidavit judgment Evans, summary Gardner other documents trial submitted to the 1185, 1190, 110 Idaho 719 P.2d in determining whether were there denied, cert. 479 U.S. 107 S.Ct. genuine issues of material fact. (1986). 93 L.Ed.2d 701 Jay Layman’s contends affida- 56(e) requires “support- I.R.C.P. vit establishes: opposing affidavits shall be made agreements 1. There were numerous personal knowledge, shall set Star, Lay- between which included forth as would be admissible in evi- man, regarding problems and Hecla facts dence, shall affirmatively show develop- with the 1984 lease and the competent testify ment to the draft. affiant (Emphasis stated matters therein.” add- continuing agreements 2. There were ed.) matters referred Gard- between regarding Star and Hecla sale ner, plaintiffs rely, which the possible concentrates markets satisfy requirement do not either for the concentrates. admissibility competency under Rule Jay Layman’s Star also contends that 56(e). opinions Most are or conclusions affidavit and other documents submitted to Gardner, of which are ... inadmissible.” repre- trial court the establish that Hecla deny sented that Hecla did not intend to that in We note neither the Gardner right proceed operating the to with Star opinion nor Court’s the record indicates the mine. objection was that there to the trial court’s to which consideration matters Gard- theory waiver is ac- Star’s that Hecla’s above, As ner referred. we have indicated tion, silence, operated ac- and inaction as objection some form of in trial the draft Hec- ceptance of the 1987 and waived preserve right necessary to the to chal- right the rely la’s to on 1984 lease. Star lenge appeal on the or admission consider- argues that the draft Hecla drafted evidence, plain ation of unless the error is of and initiated a course conduct demon- extent, or strating agreed fundamental. To this we now parties that the to admissibility that restrict review of the of new lease terms. Star contends our 56(e) strictly more whether Hecla silent as to 1987 evidence under I.R.C.P. submitting ques- draft after it to Star is than did. a Gardner pos- de Comineo and Hecla of about market affidavit ne a finally the course of sibilities. Comineo offered general in terms scribes Hecla from contract. Star received contract gotiations Star between August shipment in 1987. Al December 1988 for both through October 1985 lead made in the and zinc. though the statements some of concerning negotiations are these affidavit understanding 7. Pursuant to Star’s by a foundation that would supported Hecla, not signed the draft with Star admissibility, we conclude their establish copy shipping agree- sent nego Mere consequential. this is not that ment to Hecla. new lease do not establish for a tiations improperly equipment Hecla seized 8. rely right to on the Hecla its that waived This located the mine. Star lease. equipment remained site as at mine understanding of an Star a result following assertions are the More critical reopen upon obtaining was to the mine his affidavit: Jay Layman a contract from Comineo. that it had represented Star 1. Hecla agree to lease the mine because authority with the trial court that these We conclusory pro- and do Bunker was default statements concerning specific, mine. the kind admissible facts with Hecla vide en- support prevent will either or letter Star received a 2. When summary As try judgment. the Court general counsel dated Hecla’s Gardner, these “do not said statements 25, 1987, forwarding draft satisfy requirement of either the admissi- “like fi- stating he would 56(e).” bility competency under Rule parties all such that nalize draft] [the 110 Idaho at 719 P.2d at 1190. sign once the prepared be them will settled,” imme- strike is Comineo Excluding the inadmissible asser orally to Hecla diately communicated affidavit, Jay Layman’s tions contained terms and accepted the that Star genuine no issues of material fact there are signed agreed that the draft would alleged of its concerning Hecla’s waiver marketing agree- obtaining a 1984 lease. The 1987 right rely ment. sign must be states that all draft agreed that the 1987 and Star effective, undisputed 3. Hecla it it is and is fore addition, and was contained all terms draft In most sign. Hecla did not existing between the argues it took in reli the new actions that Star parties. on the draft were taken before ance draft to Star. Star’s the 1987 understanding submitted It was Star’s and meet maintain the mine decisions to sign Hecla would Hecla that Star and during negotia regulations government draft, production and start the 1987 reliance period do not show because tion Comineo, as shipping to soon appropriate were under these actions strike was terminated. the Comineo existing 1984 lease. September first week litigation with credi- into entered genuine is Likewise, no there are tors, representations by based concerning Hecla be of material fact sues that Star of Hecla representatives terminating equitably estopped from production able to commence would be no There is evidence the 1984 lease. Approximately in the near future. was argument that Hecla support Star’s in $40,000 participation spent leasing regarding dealing with Bunker not expense would This litigation. this is that only evidence The mine Bunker. indicated considering selling had Hecla its have occurred may have been recog- with Hecla problems In there were to Bunker. in the mine interest nizing event, lease. interest Star Star’s leasehold whatever affected. not have been the mine would through November September From Also, assertions the inadmissible without discussions continued Jay Layman the affidavit of there Accepting is no foregoing district court’s any allegedly value, evidence of Star’s reliance on assessment point at face at representation by any false Hecla. reasonable reader would wonder how it

came about the district court neverthe- less was able to move on and reach the IV. that, partial conclusion “Hecla is entitled to summary judgment on the issue of the CONCLUSION. any existence of enforceable leasehold in- summary judgment We affirm the by Star-Morning Mining terest held Com- remand the case to the trial court for fur- pany Star-Morning in the Despite Mine.” proceedings. ther the court’s expressed remonstrances and dissatisfaction with the affidavits of both appeal respon- We award costs on parties, readily apparent it is that neither dents. plaintiff corporate nor defendant by entities were troubled the language BAKES, C.J., McDEVITT, J., and affidavit, denigrated each used Tern, TROUT, J., Pro concur. by i.e., conclusory, the court as “We BISTLINE, Justice, dissenting. agreed,” aware,” “all were “Hecla represented____” decision, In its memorandum the district writing Court, opinion for this provides history recitation of the Johnson, Justice case, 839 P.2d at 1195 beginning and then on the bottom n (1992), only four, states that: page recognizes the rules relative summary judgment, citing plethora During argument oral summary on the cases—all of which purpose motion, serves no other judgment attorney Hecla’s ob- than lawyers to tell already jected what ‘to some of the evidence asserted summary know relative to judgment pro- Jay Layman] affidavit of on the [in ceedings. grounds conclusory that it's and no foun- attorney dation.’ Hecla’s gave then supposed opinion, heart of the cap- example and asked the court to consider “Discussion,” tioned naturally go should carefully Jay Layman affidavit be- the heart of the controversy. The first cause it contained incompetent some evi- paragraph thereof fault in finds the affida- dence. Hecla, vits even-handedly finds that really interested reader will become Star-Morning guilty of the same fault. better informed as to the district court’s The theme of the district court is best regard affidavits, of the including all exemplified by sentences, disjointed two be- Jay Layman by taking affidavit note of ing the last sentence of paragraph the first the district court’s written decision wherein discussion, in the being and the second is stated: final sentence at the bottom same The affidavits of William J. Grismer and page: “The affidavits both [submitted Frank J. Breidt submitted Hecla in parties] do not reflect awhen conversation support of its motion and the affidavit of place, present, took what____ who was nor who said S. submitted SMMC pro- None of these statements opposition general- to Hecla’s motion are specific, the kind of vide admissible facts ized, conclusory, specificity and lack the support prevent which will either required by 56(e). IRCP The affidavits entry summary judgment.” R. at 117. do not reflect when a conversation took together, they explain, Taken serve to place, present, who was nor who said justify, the district court’s reason for what. branding “generalized, the affidavits con-

clusory, lacking best, in specificity” as to At the the Breidt affidavit indi- Star-Morning Mining Company’s alleged individually cates that he did not make Star-Morning agents leasehold interest statement to SMMC or its July Mine. that the 1984 Lease it, being perusing the there not be terminated. Grismer record before transcript testimony]2: no same and addition- makes the statement Secretary ally position in his as Jay Layman indicates 1. had numerous S. person, meetings Kelley, the with Colleen Ron of Hecla that Art Brown was Walde, Kahlor, Hank Hecla and responsible at Hecla for mak- ‘who was regarding problems. the EPA ing agreement.’ addi- any final Grismer ‘I not 2. Hank tionally states did intend In the summer specifically of Hecla informed be made with- Walde modification whatsoever Jay no Layman that there had been S. approval out consent of Bunker the and or Bunk- discussions involvement with Limited.’ concerning entering into a er Limited Jay Layman’s affidavit contains few S. the Star operating lease or statements, upon instead it relies direct representations, his Mine. Based conclusory and use of the uninformative negotia- SMMCentered into settlement nego- participated in phrases such as ‘we Trading. tions with Acme ...,’; plaintiffs the ‘Hecla tiations with Layman Breidt Jay 3. S. told Frank ’; immediately represented ‘SMMC ... Hill of conversa- Bunker each his ’; orally ... communicated marketplace. someone in the tions with ’; agreed ... ‘All were aware ‘We represented 4. Frank Breidt S. ’; upon representations by rep- ... ‘based by combining our concen- ...’; plaintiff resentatives of and marketing more trates we would have indicated____’ None of these ‘Hecla power. specific, provide the kind of statements R. 118. support facts which will either admissible his judge, having laid out district entry summary judg- the prevent facts, undisputed perception of the own ment. litigating parties presented the with R. 117. reached: conclusions decision, point in written At that July Lease I conclude that the thoroughly court discounted district Agreement properly timely and ter- parties, respectively showings which the September Hecla 1988. minated Mining and Bunker Hill Company July Agreement That the 1984 Lease Partnership, plaintiffs-respondents, Limited by August had abandoned not been Co., Star-Morning Mining defendant- in- language established is affidavits, per their appellant, made Draft cluded by the court’s assess- is well-documented provides for the Lease controversy: ment of the July Lease of the cancellation Agreement. presented parties1 have In effect dispute concerning specific facts There is no SMMC’s this motion based mining period following specific, suspension of for and the active stated above months nor SMMC consecutive undisputed, facts dis- twelve material [which least mine concentrate at pieced together by failure to apparently trict court con- of all the facts inferences only presented of the co- construction motion was that Star-Morning not plaintiffs. pleadings, depositions, did move sum- and admis- tained in likewise, affidavits, mary judgment. sions, It had filed a counterclaim supporting monetary damages, seeking and that claim for it, non-moving party. light favorable to most not the district court. relief was dealt applied that in this rule If the district case, necessarily surely have surfaced it would which should If there controversies ever trial, opinion, in the disposed this in the "Discussion” section of without a is been have court, example. weighing process reveal prime as noted which would The trial form of a paragraph, principle, recite initially application did estab- disclos- first of that the court’s summary judgment principles may lished relative I am It be that it took court. where Specifically procedures. men- reading, weighing process motions my remiss non-moving party is' was the rule that tioned me. certainly not obvious court's liberal the benefit of trial entitled to 15,000 during tons of any period may ore providing be seen as some of the rea- twelve consecutive months. soning upholding decision, for which reasoning solely province within the R. 118. the district court. As to the extent to which those conclu- regret I Accordingly, my inability to properly join sions were drawn the district court, opinion, probably that is Court’s and dissent therefrom. determinable eyes of the beholder. Obviously, Justice authoring

Johnson in opinion for the APPENDIX A problem. Court sees no Apparently the John R. other members of the Court are untrou- difficulty bled. The experience which I Loft, Layman, Arpin & White part stems in from recollection of the P.O. Box 1907 disposition Court’s recent Haessly v. Title, 121 Idaho Safeco Spokane, WA 99210-1097 (1992). There, rehearing the Court (509) Phone: 455-8883 opinion withdrew its earlier in favor of Haesslys opinion and issued a second William W. Nixon grant summary judgment vacated the Haesslys, P.O. Box 1560 based on this Court’s obser- vation astray district court went d’Alene, Coeur ID 83814-1560 granting summary judgment “without to, giving recognition of, (208) discussion Phone: 667-4655 second of Safeco’s two theories of defense Attorneys for ...” Idaho at 825 P.2d at 1122. Mining Company Understanding precedential that to be a In the District Court of the First Judicial ruling, an even-handed administration of Idaho, District of the State of in and justice requires that this Court do likewise County for the of Shoshone end, in this case. To appended hereto are the trial (Appendix brief and exhibits Mining Hecla Company and Bunker A) corporate which the lesser entity, Star- Partnership, plaintiffs, Limited Morning Mining Company provided to the Any open-minded district court. reader peruses

who readily brief should Morning Mining Company, defendant. brought to the conclusion that this was not No. 28208 proper summary case for disposition on summary Hecla’s motion for judgment. DEFENDANT’S BRIEF IN RESPONSE doubt, Beyond any the district court should TO PLAINTIFFS’ MOTION FOR fully acquainted have become more PARTIAL SUMMARYJUDGMENT possible the case than was under the then I. INTRODUCTION presented circumstances. respectfully requests Defendant that the One these circumstances is found deny plaintiffs’ partial motion for brief, clearly the attachments to the dem- summary judgment genuine because issues onstrating in Hecla’s own words that “eco- of material fact exist as to: problem nomic recess” had been a beset- a) Whether the had modified the ting Star-Morning. both original and had Strangely enough, previ- Article 23 in the agreed to the terms of a new lease as ous 1984 recognized Lease accompanying set forth the lease majeure” “force as a excuse for viable 25,1987. Mike White’s letter short, performance. lessened one mem- is, certain, b) of this Court all estopped ber Whether just deny enforceability convinced that this Court is not review- the existence and court, rulings of the district of said lease. 15,- production requirement

included a of pro- 000 tons and months of continuous original in c) the lease still Whether however, duction; plaintiffs never elected effect and enforceable. pursuant to terminate the to these September terms until 1988. OF FACTS II. STATEMENT Immediately after the shut-down in Octo- 1984, Morning Mining early Com- In 1985, representatives defendant’s ber referred to as ‘Defen- pany, hereinafter plaintiffs negotiations commenced re- Striker, dant,’ formed Jim an inde- was garding continuation and modification of miner from the Wal- pendent contract Jay Layman, Agreement. Oper- Lease lace/Kellogg Jim Striker had area. defendant, Manager of the conferred ations Morning Mine as an the Star worked representatives on plaintiffs’ with a month- independent contract miner for over 18 weekly, ly, and oftentimes basis. Morning Mine had been years. The Star plaintiffs shut down regarding relationship Discussions in- volved, without limitation: 19, 1984, Approximately July Hecla On Limited Part- Mining Company (1) outstanding and Bunker Itemizing balance owed Lease; into a Lease and Rental nership entered plaintiffs, pursuant Morning Mining Com- Agreement with Star (2) Restructuring charges; mill and Rental In addition to the Lease pany. (3) Restructuring tonnage requirement; into a plaintiffs also entered Agreement, (4) require- Restructuring production place Marketing Agreement concen- ment; with a smelt- produced by defendant trates (5) analysis of Review and defendant’s had shut Mine been er. plan; reopening budget and mine years, and the defen- for over two down (6) analysis potential of mar- Review and a substantial performing had to dant concentrates; ket any produc- of restoration before amount negotiations (7) analysis Review commenced resto- tion of ore. Defendant regarding discharge the EPA water with 1, 1984, May by September ration in problems. producing approximately capable of all resolved and in- The above items were However, daily. tons of ore August Agreement. cluded long-term mar- unable secure been August Agreement, In the by the end ket for the concentrates production re- specifically restructured November inserting royalty. a minimum quirement by result, indepen- defendant had to As a August Exhibit Plaintiffs for its a market dently seek out obtain letter, they un- and outlines that indicates only market available at concentrates. production impossibility of un- derstood the Kobe, Japan. was with Mitsui the time a market was obtained. til Kobe, Ja- ship concentrates In order to Wilma, shutdown in 1985 until Immediately after pan, ore had to be trucked defendant August plaintiffs and shipped to Washington, barged or rail Van- agreement. a new negotiated the terms of couver, freighted to Washington, and ocean exchanges meetings, There were numerous defendant com- early Kobe. govern- with and consultations Payment from of drafts shipping to Mitsui. menced negotiation. On to resolve the four ment bodies involved a Mitsui for ore concentrates Jay S. Layman, G. August John avail- delay. If a market had been month Grismer, and Michael Layman, Comineo, William J. only a three week mar- able with the terms of agreed to B. met and From White have existed. gin payment Mike agreement. On Mit- commencing, shipment to the time along the terms of lead, sent letter con- White sui, zinc and silver prices upon Star executed until, to be depressed Octo- tinued to become entering into a Company Morning Mining to cease was forced defendant ber agreement. marketing Lease production. The 1984 Company unable to renew lease—lack c) agreement, legal position of smelter During negotiations these and culmina- previous not to terminate contract— agreement, tion of the terms to the Morning Mining Compa- wait for Star representatives indicated that had the negotiate ny to new contract and re- authority right agree- to enter into the date that. Exhibit A5. property ment on the since Bunker Hill 3, 1988, 6. June letter from Arthur Limited was default with Hecla on its Brown, Hecla, President of to Jack agreement regarding property. Kendrick, President of Bunker Limited produced pursuant Documents to Re- Partnership, regarding meeting recent 20, 1990, quest January for Production on concerning Hill discussion of Bunker chronology demonstrate the of events: acquiring leasing Morning Star 14, 1987, August 1. from Hecla memo Explains delay working Mine. White, attorney, B. Michael to William to their favor because of mineral Grismer, President, J. Vice Gordon H. prices. Exhibit A6. Kelley regarding Walde and Colleen D. 27, 1988, 7. June letter from J.W. Ken- meeting Morning Mining with Star drick, Mining President Bunker I-MI Company August 1987—Outline Brown, Company, to Arthur President agenda meeting. Exhibit Al. Hecla, regarding acquiring Hecla’s 24, 1987, July 2. letter from Colleen D. interest in the Star. A7. Exhibit Kelley, Hecla Senior Environmental 4, 1988, 8. Hecla IOM to Bill Carroll, Engineer to Ms. Florence U.S. regarding Grismer from G.H. Walde Agency, Environmental Protection re- telephone Jay Layman call from con- garding permit modification of —allow- cerning rumors that Bunker Hill was ing Morning Mining Company Star going ship Star concentrates to re-open operate stating mine and mill— him I nothing Comineo—I told knew Morning Mining Company Star will be Jay go- about stated Comineo was it— acting as Lessee. Exhibit A2. expansion ahead with and was September 9,1987, Hecla memo from counting on the Star concentrates. William J. Grismer to Michael B. White A8. Exhibit regarding telephone conference with plaintiffs, The facts are clear Jerry Layman indicating that Comineo Hecla, through operating partner, their backlog possible had a after strike — approval, Hill’s negotiated with Bunker delay month Morning Mining —Star entered into a new to be execut- Company looking for other market— upon obtaining agreement. ed a smelter In requested approval speak price increased; 1988 the of zinc Bunker Hill regarding joint shipments Bunker Hill, Morning Mining based Star Com- approval given Jerry concentrate — — pany during negotia- data released to Hecla Layman they indicates that want tions, re-open decided the mine itself. up start as soon as a mar- find In plaintiffs requested late 1986 defen- financing place. A3. Exhibit ket— repairing dant assist in tunnel cave-ins as if 6, 1987, from 4. November letter G.H. the Lease were in effect. In Walde, Hecla, Swanson, to Jack Bunk- plaintiffs proceeds late allocated Partnership, regarding er Limited Star independent Jim Striker’s contract work for potential Unit reserves—Star Lucky Friday to defendant’s lease obli- Mining Company decreased value of gations. spring In the of 1987 property mining plan. A4. Exhibit requested altering defendant to assist May from Dar- IOM discharge satisfy EPA de- water up- Sayer regarding rell to Fred Wicks mands. Morning mining date status a) representatives de- Company lease: review lease to Defendant’s understood Hill, terminated, b) kept if it that Bunker Ltd. was informed termine should be fact, Hill, Bunker major Morning Mining negotiations. reason tion Mining Company; of Star Hank Walde any such rumor. denied requests production, to its pursuant receiving copies drafts of been agreements plain- Based Jay negotiations Lay- for 1987. the lease representations, tiffs’ defendant entered man had numerous conversations with negotiations into settlement with creditors Frank Breidt of Bunker Hill Limited re- litigation and defended in Portland with negotiations marketing garding con- Trading Company, expending Acme over Mr. Breidt never informed centrates. $40,000 legal fees. disap- Hill Limited that Bunker July proved of of the terms of the III. AND

Lease. ARGUMENTS AUTHORITIES July defendant continued to After Requirements A. Standards operate plaintiffs’ acqui- and function with Summary Judgment. that the Lease was in effect. De- escence in plaintiffs’ rep- contact with fendant was summary judgment prop A motion for monthly regarding on a resentatives basis genuine er when is no only ‘there issue as ongoing negotiations smelter with Com- moving material fact and that the ineo, in Japan, Mitsui J. Ahrens & Co. party judgment to a as a is entitled matter requested provide Plaintiffs that defendant 56(c). of I.R.C.P. v. EG law.’ Jones & G complete plan, including budget, mine a Inc., 591, 111 Idaho Idaho financing and reserve allocation. Defen- (1986). liberally The must construe reopen financing dant secured existing in the facts in the record favor of by obtaining agreement a smelter mine nonmoving party. Anderson v. plaintiffs. this confirmed with 658, 660, Ethington, 103 Idaho 651 P.2d 4, 1987, Jay On met November (1982). 923 to inform Hank with Hank Walde Walde ‘totality The court look to the must Bunker Hill and Frank Breidt of Limited motions, affidavits, depositions, plead regarding from J. Ahrens a proposal exhibits,’ ings, merely and attached not marketing agreement since an Comineohad portions of the record isolation. Central time, that overload of concentrates. At Tumer, 92 Agency. Idaho Inc. Idaho made decision was with Walde and initial 306, 310, (1968). A motion for P.2d margin that there was sufficient Breidt if summary judgment must denied be prices. justify operation present at the conflicting evidence is such that inferences 1988, 15, Jay Layman in- On March can drawn if be therefrom and reasonable Breidt Hank and Frank formed Walde might conclusions. men reach different had a renewed interest receiv- Comineo 323, Hazen, Lundy v. 90 Idaho P.2d potential mar- a concentrates (1966). All doubts and all favorable forthcoming. agreement On keting may reasonably be drawn inferences which 1988, Layman spoke April Jay against from the evidence will be resolved shipping to discuss to Comin- Frank Breidt summary judg for the party moving shipments Japan. potential joint eo or evidence can ment. Id. Circumstantial 25, 1988, Layman reported May on On genuine issue of fact. Petricevich create a expansion and need for con- the Comineo Co., 92 Idaho v. Salmon River Canal to both Frank Breidt of Bunker centrate (1969). 868-69, 452 P.2d 362 Partnership and Hank Walde Hill Limited July Jay Layman of Hecla. On plaintiffs clearly facts indicate Frank Breidt phone had conversations with a negotiated agreed upon terms for concerning and Hank Walde Comineo. agreement to executed 1987 lease agreement. obtaining a smelter defendant Jay Layman spoke August On should be The issues raised regarding ru- Walde of Hecla with Hank genu- by the trier fact because been en- reviewed mors that lease exist. ine issues material fact opera- Hill for the into with Bunker tered notify offeree should the offeror that he accept. does not intend to Question Regard- Exists Fact B. A offer of August Plaintiffs took the benefit of the ing Whether Binding and En- from defendant. Plaintiffs relied is a services Agreement upon defendant’s services with reasonable Contract. forceable following areas with- reject time to August 1987 Lease terms of out limitation: par- agreed all had been negotiations; 1. EPA Hecla August 1987. concerned ties Bunker Hill Limited Mining Company and discharge problem; 2. Restoration of actions, Partnership, by their affirmative mine; Repair 3. of cave-ins inaction, accep- operated as an silence and seizing profits Improperly from CSC agreement. tance to the Co., Mining partner in the Star Morn- position forth the that their set Plaintiffs ing Mining Company as debt to 1987 does not con- silence after Partnership, Hill and Bunker Limited argue acceptance. Plaintiffs stitute agreement; pursuant to the lease offer; to the lease they were silent as Seizing equipment left the mine however, actuality, they made the offer Morning Mining as a result of Star outlined, and, affirmatively previously Company’s upon the lease reliance demonstrating of conduct initiated a course effect; agreement being in agreed to. lease terms had been that new Morning Min- 6. and use of Star Review Madden, 110 They rely upon Vogt v. Idaho marketing negotiations ing Company’s (1986) support P.2d 442 to smelters; with Comineo and other does not position that silence or non-action Morning and of Min- 7. Use review Star acceptance of an offer. This constitute ing Company’s mining plan and bud- misplaced as the facts demon- argument is get; 1) that, contrary, plaintiffs: strate to the agreed to defendant conveyed the to terms and of the substantial Use benefit August accompanying Morning Mike White’s Min- reserves created 1987, letter; 2) plaintiffs were not silent as ing Company’s efforts. agreement Jay Lay- as set forth in to the assertions, Contrary plaintiffs’ their (Exhibit B) man’s Affidavit and Exhibit a actions demonstrated to defendant that hereto, A, attached which consists of docu- reached and agreement new lease had been produced pursuant requests ments encouraged as if the lease defendant act 3) Vogt analysis silence

production; in effect. were in this cir- apply plaintiffs does not to the dealings plain- Finally, prior holds In the event the court cumstance. made it reasonable that tiffs and defendant Vogt analysis applies, the entire that the plaintiffs should have terminated the 1984 considered, including its ex- should case be agreements they if did not and 1987 lease ceptions adopted from the Re- which were they in effect. Since believe were (1981): Contracts, statement 2d § ongoing plaintiffs and defendant (a) takes Where an offeree the benefit plaintiffs en- working relationship in which opportu- reasonable offered services with perform couraged defendant to continue reject them and reason to know nity to Morning which benefited the Star work expecta- were offered with plaintiffs. Plaintiffs were Mine an asset of compensation; tion of negotia- throughout the continuous aware giv- (b) offeror has stated or Where the agreement was process that a smelter tion to understand that en the offeree reason of the lease docu- essential for execution by silence or may manifested assent ment inaction, remaining silent and the offeree offer; accept intends to question and inactive of fact exists It is clear that a agreement not the 1987 dealings whether or (c) previous Where because of otherwise, force. it is reasonable something parties intended to be a condi- precedent question Id., is a tion fact. signature was Limited’s Bunker C. Consequently, this issue should be to the precedent condition not a addressed the trier of fact and not ruled so, they are es- contract if during summary judg- the motion for posi- asserting such a topped from ment. tion allege Bunker Hill Limit- Plaintiffs Estopped By Are D. Plaintiffs precedent to signature was a condition ed’s Quasi Promissory Doctrines being The facts indicate contract valid. Deny a Estoppel to the Existence of precedent, Bunker if it was condition Lease Valid Enforceable previ- and actions as Limited’s silence Hill rely ously set forth caused defendant The facts are clear that acceptance. upon their negotiated new terms defendant Limited was aware of and Bunker Hill agreement as to those terms reached regarding the negotiations participated Mike sent an offer August of 1987. White ap- Agreement and had of the 1987 terms Agreement on terms in a Lease of these proved such terms. 1987. This was It orally accepted by the defendant. Morning Mining Jay Layman of Star formally executed agreed that it would be the Au- Company, and after both before Mining Company en- when Star agreement, had numerous gust agreement. into a smelter tered Breidt of with Frank phone conversations Limited, concerning activ- their Bunker Hill strike from suffered labor Comineo Morning Mine. plans the Star ities and through September of and the May anyone else from Breidt nor Neither Frank agreed sign the documents indi- Partnership ever Hill Limited Bunker go The mine could not obtaining a market. Morning Mining Company cated to a market. Defen- production into without lease, its 1984 or representative that the and con- upon plaintiffs’ relied words dant 25,1987, not in August replacement of plaintiffs estopped from now duct and going to cancelled. or was be effect not enter into such asserting did agreements. told defendant representatives agree to the authority to they had estoppel re- promissory The doctrine of agreement because of the 1987 terms promise. upon specific quires reliance in default with Hecla Hill was Bunker Contracts, (Second) 98 Restatement § proper- underlying agreement on the their (1979). ty- seeking itself of the party A to avail estoppel Woodworth, promissory must Lease, doctrine of v. Inc. Wide

World (Ct.App.1987), show that: 880, 728 P.2d 769 111 Idaho by plaintiffs, indicates (1) relied in reliance suffered the detriment by sense; not favored precedents are condition in an economic was substantial courts, of the that the conduct promisee act- (2) loss to the substantial analysis of the may a factor be have been or should ing reliance was precedent. of the condition existence promisor; foreseeable reason (3) have acted promisee must Partnership was Limited Bunker Hill promise on the justifiable reliance ably of the 1987 Lease the terms aware of Caldwell, City as made. Gilbert August prior Agreement (Ct.App. 355 732 P.2d 112 Idaho Partnership’s oral Limited Hill Bunker Shultz, Idaho 1987); 86 citing Mohr v. silence after actions and communication (1964). P.2d approval of indicated its reliance. Agreement and defendant’s upon the reasonably relied Defendant defendant plaintiffs that goes promise of Inc. Lease The court in World Wide opera- development and continue able to not the be point out that whether on to quasi estoppel prohibit are to an individual securing advantage himself, some for Morning tion of the Star mine when a produce or to disadvantage some to the marketing agreement completed had been persons seeking estoppel, party after a market for and a concentrates could be change has been induced to position. his plaintiffs prevail in secured. Should their Clearing Carrier Services v. Ore-Ida to terminate the lease effort Foods, Inc., 110 Idaho 714 P.2d defendant, with defendant will suffer cata- (Ct.App.1986); citing Tommerup v. Al strophic economic detriment. Plaintiffs bertson’s, Inc., 101 Idaho were well aware efforts of defen- (1980). addition, In it would be unconscio Morning dant to rehabilitate the Star Mine party nable to allow a posi to maintain a preparation reopening mining tion which is position inconsistent with the addition, operation. In kept defendant they had taken in order to secure a benefit. plaintiffs constantly advised as defen- Id. dant’s efforts to find a solution to discharge problems, water to secure a mar- plain- substantial benefits accrued to ket for concentrate and to settle the Acme rehabilitation, tiffs as a result of per- controversy. mitting, marketing efforts of defen- dant are plain- evidenced the fact that Defendant advised almost begun operation tiffs have of the Star monthly expenditure defendant’s (See Morning Mine. affidavit of Scott mine, money time and to rehabilitate the Layman, Operations Manager, B.) concentrate, Exhibit secure a market for ore addition, plaintiffs are benefitted discharge problems solve the water and to development marketing mine research financing mining operation. secure for its performed by defendant. It would un- reasonably Plaintiffs should have be foreseen permit plaintiffs conscionable to pro- that defendant’s to termi- investments would nate the lease rights relationship duce substantial loss if the to mine defendant after Morning changed position the Star mine defendant had were terminated. promises reliance and conduct of estopped Plaintiffs are deny that their plaintiffs. Plaintiffs should estopped promises and conduct caused defendant to from their efforts to terminate undertake efforts to rehabilitate the mine Agreements thereby and 1987 Lease oust- plain- and market the ore. The intention of rightful defendant from its leasehold tiffs as to the modification the terms of possession of the Star mine. imple- the 1984 Lease and the mentation of such terms is immaterial. E. have right waived their Plaintiff's estoppel simply up a barrier is set unilaterally July terminate the regardless parties’ of intentions 19, 1984 precludes asserting from one a 16, allege September Plaintiffs that on right he would otherwise have but for right 1988 had the to terminate the things pleaded by the matters and July 19, 1984, lease of based way estoppel, if such and matters 15,000 ton and the twelve consecutive things properly pleaded proven. However, production requirements. month Seaport Dippel, Bank 112 Citizens v. defendant maintains that if the 1987 Lease 736, (Ct.App.1987). Idaho P.2d valid, genuine is held not to be then a issue plaintiffs attempted After to terminate plain- of material fact exists to whether lease, Morning Mining Company ability tiffs have waived their to make such representatives were told that Hecla had a termination. changed its mind and did not want to con- Development In Riverside v. Co. Rit- mine; Star-Morning a tinue as lessor chie, 657, 103 Idaho 650 P.2d the Court instead, wanted to sell the mine to held: recoup Bunker Hill pre-existing a debt pur- ordinarily The existence of is a

owed to Hecla Bunker Hill. The waiver pose if promissory question of the doctrines of of fact and there is sub-

Plaintiffs’ continued course of conduct from October 1985 misled defendant to its support in the record to evidence stantial regard prejudice plaintiffs’ intent to for the trier of fact to it is a waiver strictly enforce the termination clause if the evidence establishes determine result, agreement, and the 1984 as a should a waiver. such genuine A constitute a waiver. issue of Id. 660. material fact exists as whether or not to hold that ‘an intent The court went on plaintiffs’ course of conduct constitutes a however, right may, be estab- to waive a waiver. lished conduct.’ Id. part allegation, plaintiffs As a of this defendant to continue Plaintiffs allowed argue they may hold defendant to reopening to work provisions letter of the termination of the Mine, from the time it shut down They 1984 Lease. cite to Nichols v. September Notice of Termination on until Knowles, (1964), 87 Idaho 394 P.2d 630 detrimentally relied 1988. Defendant and Howard v. Bar Bell Land & Cattle plaintiffs’ representa- actions (1959) Co., 81 Idaho P.2d 103 for substantially Plaintiffs benefited tions. proposition ‘respect that courts must defendant, the actions of without provisions lawfully agreed of a contract mine, limitation, in of the rehabilitation A to.’ closer look both of these cases marketing development plan, mine use of provisions con shows where negotiations, and establishment contract tract, applied, strictly when would cause a of additional reserves. resulting and a forfeiture unconscionable plaintiffs grant to waive these penalty, equity The intent will intercede to re Knowles, 1987 draft requirements is clear lief. v. 87 Idaho two Nichols White, 633; August 25 letter of Mr. Exhibit P.2d at Howard v. Bar Bell Land & Co., plaintiffs realized that defendant at 107. 8. The 81 Idaho 340 P.2d Cattle market, nor the Supreme had no control over The Idaho Court both Nichols al., mined. price Cupic of the minerals cite to et economic and Howard Graves (1954). 75 Idaho Graves forth in Riverside Idaho courts have set forfeitures are abhorred clearly states that Co., in- question Development Id. Id., 272 P.2d at 1023. by the courts. case judged on a situational tent must be genuine A issue of repercussions to defendant caused by case basis. Id. plain- judgment forfeiture summary exists whether or not forced material fact termination, rights rights of the Star their of its under tiffs waived economically cata- agreement. the 1984 Area would be pursuant Unit Equi- strophic grossly unconscionable. negotiations and continued ty grant specific performance should not perform work on requests defendant to for so the failure to do a forfeiture unless such a property constituted the leased result. Id. lead to an unconscionable compli- strict of conduct as to waive course partial plaintiffs’ The denial of motion the lease. The the terms of ance with permitting summary judgment, and thus acceptance recog- continued plaintiffs’ go parties to controversy between the the Morning’s inability to mine nition that Star be far trial on the merits would a continuously, produce or to months twelve In fact the re- unconscionable result. an 15,000 tons, their con- beyond were factors true. verse would be trol, price of metals and the by dictated the can no oral claim that there be Develop- Plaintiffs In Riverside market available. termination modification of the Co., Id., set out that or other the Idaho courts ment cite Lease. Plaintiffs provision of the 1984 by a lessor continuing course of conduct ‘a Company v. Mining prejudice Triangle in to lessee to his which misleads a Stauffer authority Co., F.2d as strictly en- 753 intent to Chemical regard to the lessor’s (9th 734, 739 argument. 753 F.2d for this may constitute of the lease force the terms Company is Cir.1985). Mining Triangle a waiver.’ Id. foresee, they did not if had foreseen it. distinguishable from In clearly this case. Id., at 739. the termination clause in the place, the first Answer, alleges in Defendant and ar- Company/Stauffer Triangle Mining Chemi- here, gues assumptions the basic of mining contract an un- Company cal provisions the termination of the 1984 qualified right to terminate without cause. by agreement Lease had oral been modified addition, right In the bilateral to terminate parties upon of the to be executed the solely to secure tax benefits was inserted obtaining marketing agreement. of a Said nothing parties and had to do with for both expend modification caused defendant to performance Secondly, under the contract. prom- substantial in reliance sums Mining Triangle contract contained two plaintiffs by ises that there would be no liquidated damage protect clauses to precipitous of the 1984 termination Lease. parties equally in case of Tri- termination. The modifications necessity for the was to Company, at angle Mining 736. The ef- contingencies developing address late damage liquidated fect of clauses was parties were not foreseen at the pre-contract parties to their to return the of the of the 1984 time execution Lease. party position matter which no evoked parties unperformed The an contract provision. It would unrea- termination be consent, may, by modify byif mutual alter- compare attempt to the factual sonable to ing, adding provisions, excising or and such pattern Triangle Mining Company of parol agreement may modification be present mining arrangement. writing. though the is in contract Ore-Ida point additionally out that the Plaintiffs Larsen, Products, Potato Inc. v. Idaho Company Triangle Mining court held that (1961). The 362 P.2d fact of obligation good of implied ‘there is no faith modify may implied be preventing parties. It termination.’ should be not- from the course of conduct of the to a yet ed courts have Id. 362 P.2d at 387. Consent modifica- that the ‘Idaho to decide prior may tion of a written contract generally contain an im- whether contracts implied of conduct from a course consistent plied good obligation to act faith or with the asserted modification. Resource good con- whether faith reasonableness Siler, Inc. v. 94 Idaho Engineering, power dition otherwise unrestricted [an] (1972); citing P.2d Ore-Ida Triangle Mining Company, termination.’ Products, question Potato Inc. Castle, 738; citing Scott v. 104 Idaho alleged oral modification is whether an (Ct.App.1983). 662 P.2d proven is on for the trier of fact decide. Therefore, note, defendant did Id. allege bad faith. Based both Scott, Triangle Mining Company questions de- It is abundant clear that argues obligations good concerning fendant fact modification termi- in the 1984 Lease parties. faith are tied to the intent of nation clause must be 739; addressed a trial court. order to Company, Triangle Mining Id. at Castle, determine whether the reached Scott Id. modification, understanding mutual Appeals Ninth Circuit Court compe- trial court to examine all will need Mining Company clearly sets Triangle relating to un- tent extrinsic evidence concept forth which is essential to the derstandings agreements par- controversy in review of the termination Green, Company, ties. Inc. v. Shields & quote: at bar. To case (1980). It 100 Idaho 606 P.2d 986 is requirement of reasonableness well in Idaho that to a settled to protect a contract not modify read into may written terms contract approximate may party subsequent weaker but what contract oral subject expressly provid- respect to its matter. parties would have further with 1168; citing Castle, 662 P.2d respect contingency ed to a that Scott with (R. 60) EXHIBIT A2 July Syndicate, Mining Inc. v. Silver Sunshine Co., (1979). 101 Idaho Ms. Florence Carroll Agency

U.S. Environmental Protection Section, Compliance Water WD135 CONCLUSION Region 1200 Sixth Avenue respectfully requests Defendant that the Seattle, Washington 98101 deny plaintiffs’ Motion for Court Partial ID-000167, Re: Permit NPDES No. Re- Summary Judgment. many There remain Modification, quest Star-Morning for genuine concerning issues of material fact Complex the status of the 1987 Lease Dear Ms. Carroll: Lease. Mining Company request wishes to

R. 43-58. a modification to NPDES Permit ID- No. 000167 for the Star-Morning Complex. (R. 59) EXHIBIT Al split permit sepa- Hecla wishes to with outfall, permits rate issued for each en- HECLA MINING COMPANY abling the Star side of the mine to resume operating affecting mode while not Morning side of the mine which will remain MEMORANDUM TO: William J. Grismer in the shutdown mode. This will allow the Star-Morning Mining (SMMC) Company MEMORANDUM TO: H. Walde Gordon mill, reopen operate the mine using Kelley MEMORANDUM D. TO: Colleen tailings ponds. the Star FROM: Michael B. White expects up operations SMMC start September approxi- commence late with Morning SUBJECT: Striker/Star mately days required pro- to reach full Mine Lease duction. The mill will be run on a cam- meeting Jay I have set a tentative basis, paign approximately days per 2-3 Layman compa- to discuss the status of the week. It is SMMC’s intention to divert all ny’s proposed lease with Star Min- operating water out the Star side of the ing Company Thursday, August for 20 at mine tailings ponds. to the SMMC would Apparently 9:00 a.m. here in our offices. acting as a lessee of the mine and re- Jerry Layman will for the be unavailable sponsibility discharge compliance meeting Jay indicated that he would Mining Company. remain with Hecla try pur- to have Jim Striker available. The you Please call me if should need further pose meeting is to review the follow- information. ing matters: Sincerely, financing; 1. Status of their D. Kelley Colleen request Engineer

2. Status of Hecla’s to EPA to Senior Environmental separate permit for water NPDES CDK:ld discharges tailings im- from the Star Boyd cc: Bill poundments Morning portal; cc: agreement; 3. The draft (R. 61) EXHIBIT A3 proposed op- The status of Striker’s smelting agreement.

erations and September TO: Michael B. White MEMORANDUM appreciate your I would advice concern- you whether will be able to attend a FROM: William J. Grismer meeting on the 20th. Star-Morning Mining SUBJECT: Company Idr MBW: physical plant, and Striker’s dition of the plans. afternoon, I received a call from This reserves, since above the The ore concerning reopening the Jerry Layman L have been-increased due to the addi- know, that, they mine. He said as we Split ore Noonday of the 1100 North tion ship hoped to be able to to Comineo length of ft and the has a strike strike. following settlement of the Trail high grade of 400 ft zinc ore on addition however, today, They were informed (South Split). 2000 Main Vein they determined that have a Comineo has mining from plan is to continue Striker’s available, major backlog of concentrates any develop- L without the 2000 and above respect to zinc concen- particularly with pay ment until he can off his current debts. property, Pine Point so that trates from the paid, he will dewater When the debts they anyone’s could not take concentrates L, and mine the the # 4 shaft to the 5300 meaning particularly zinc for 18 months— grade stope that is called the high silver and to include lead. prob- Noonday vein. Striker will 5300East Jerry they must now look for anoth- said offering help pay for ably a stock make spoken Acme Trad- er market and have dewatering, development, L the mine again shipping to ing in Portland about pump L station. and 5300 they Japan. He noted that Mitsui granted E.P.A. speak Limited inas- also like to to Bunker Star-Morning permission operate they have heard that a rumor is much that discharges indepen- and the Bunker Hill mine would be afloat that the mode. dently in either the active or inactive reopened. They hope that between the know, during you As the restrictions mine, Star-Morning they Bunker and the are much more severe than the active mode might quantity to be able have sufficient discharge during inactive mode. The sensibly Japan. Jerry deal in wanted to (inactive) has last 6 months shown spoke right they if it was all if know heavy marked decrease in metals and no certainly Bunker and I told them that was reports required. non-compliance have been suggested speak he fine and to Jack operation systems for the Kendrick. place operation for the mine are all they find a Jerry said that as soon as can L. the mine above 2000 Power lines to market, up the Star they will want to start repair operations require mill before will operation. He also noted now have compressed sys- air can be started. are, financing arranged as noted their but concentrator, tem, haulage system, above, now blocked a market for the accommodations, system, dry sandfill products. hoisting system above 2000 L are all operable. portal WJG: sb The main has one small about 20 ft which will cave that covers A. cc: Brown require days repair. cc: R.B. Kahler enclosing I am ore reserve data that is cc: Walde G.H. duplication of data that is in the probably N.M. Tower cc: files, might-be immedi- Bunker Hill (R. 62-63) A4 ate interest. EXHIBIT Jack, I a tentative date of No- have set November trip Lucky Friday so vember 19 for a to the

Mr. Jack Swanson stoping the underhand that we can observe Partnership Bunker Limited system property. at the Box 29 P.O. Sincerely, Kellogg, Idaho 83837 G.H. Walde Jack, Dear Project Manager Special — meeting Monday, last we dis- At our GHW:ld ore potential Area cussed the Star Unit Enclosure conditions, reserves, environmental ground considerations, availability, con- c:W.J. Grismer equipment

legal position Hecla wants to take with previous SMMC is not to terminate the (R. 64) EXHIBIT A5 contract, negoti- but to wait for SMMC to repay original ate a new contract and their HECLA. MINING COMPANY $395,773.93. debt of May DEW:jmd Sayer MEMORANDUM TO: Fred (R. 65) EXHIBIT A6 Darrell Wicks FROM: June Up- Unit SUBJECT: Area— Kendrick, Mr. Jack President date on the Status of the SMMC Partnership Bunker Limited Lease SUBJECT: Box 29 agree-

I have reviewed the SMMC lease Kellogg, Idaho 83837 ment with the Area to determine Star Unit Dear Jack: if possibly the contract should be terminat- meeting At the conclusion of our recent changes ed or if should other be made. situation, regarding promised I major changes I recommend that no at this you outlining proposal send a letter under accounting time made from an stand- which Hecla would divest of its interest in suggest Accounting point, but do De- promised the Star Mine. I to have such a partment monthly be advised on the status proposal you by the end of the month. of the situation from Hank Walde. SMMC My completed staff I has the work asked Morning Mining Company The Star be- they specific them to do and have some gan production under the lease Unfortunately, I recommendations. have produc- Star Unit Area in ceased traveling been and have not been able to standby tion in on a status review their recommendations. I will be through July June 1987 the also, out of the office all next it week so off accounts receivable balance was written appears unlikely now that I will be able to WJG). (per The amount owed Hecla at respond your request before the end of $395,773.93 that time was with the follow- ending the week June 17. = ing detail: Star accounts receivable sorry delay, I am I am sure about $330,342.62 Shop and Hecla accounts re- you busy with a of other number = $65,431.31. though ceivable Even Hecla pressing start-up problems and this item is off this accounts receivable wrote SMMC agenda. probably top your not at the uncollectible, was not released of SMMC hand, delay On the other it seems that the their owed to Hecla. debt price working our favor. The met- and, if strong rising als is this trend major why reason SMMC has been continues, of our share of with it the value option their lease at the unable to renew your patience. you the old mine. Thank Star, production since ceased finding a smelter who is seems to be will- truly Very yours, purchase their zinc concentrate. The Arthur Brown Columbia, smelter, in British previous Com- Chairman and they currently have ineo has told SMMC Chief Executive Officer stockpiles years to 2 of zinc concen- IV2 AB sk therefore, currently process; trate buyer for their zinc concen- SMMC has no 66) (R. EXHIBIT A7 trate. 27, 1988 June I have discussed the SMMCcontract with Mr. Arthur Brown possible termination Mike White as to the President previous contract or how we should situation. The HECLA MINING COMPANY treat the current SMMC Preliminary by Ned Preliminary Apr. by Ned Tower 1982. Drive, Box 6500 Mineral G-8000 1984 Mine lease—Jul d’Alene, ID Coeur Mill Rental Dear Art: = Equipment 1985 Summer Purchases Ells files See you your Thank letter of June 17 Fall of 1985 out of business regarding Possibility acquiring Hec- ) Letter settle 1986 Jan. Area; pro- it la’s interest Star Unit debt a useful framework for our future vides ) phone to Art settle

discussions. Brown debt Comineo contract travelling I most of will be Canada MBW, Memo to Jan. 6-87 hope days to take a few off this week Preliminary by Striker Dec. 86 following July. the Fourth of Neverthe- 1987 Draft of new less, top-priority this is a matter and I’m mining 12 month no active hopeful get you during I can back July week to MBW Jan. 6 Memo told Striker Comineo would you. Thank take concentrates for 18 months Sincerely, During Jay Layman called occasional- ly kept nego- I in contact as to their & BUNKER HILL MINING COMPANY tiations Comineo with (U.S.) INC. Summer 1988

J.W. Kendrick approached About the time Kendrick President Hecla, expansion Comineo talked about maybe they Jay and told JWK:nm get contract. I I wrote hand think written memo to W.J.G. to that effect. (R. HANDWRITTEN) EXHIBIT A8 67-68 I used to see Striker Wallace and things going. ask him how were R. 67-68. Bill MEMO TO: Grismer G.H. Walde

FROM: Telephone Jay Lay- SUBJECT: call from man Jay Layman Bill: called about 11:30AM today to ask about some rumors he had Shop concerning heard at the Hecla MATTHEWS, Sean Joel Petitioner- Hill. rumor Bunker was that Appellant, Bunker Hill had contract with Comineo and going ship Star Concentrates and Hill I told him I Bunker Concentrates. Idaho, Respondent. STATE nothing this. knew about No. 18772. doing I him he was Com- asked how Idaho, Supreme Court of decided ineo and he said that Comineo had Boise, January 1992 Term. expansion plans and go ahead with their counting on Concen- Comineo was Oct. trates. thinks that comineo will offer Layman- At time them a contract. concerning a new approach us

Striker will lease at the Star.

Case Details

Case Name: Hecla Mining Co. v. Star-Morning Mining Co.

Court Name: Idaho Supreme Court

Date Published: Aug 31, 1992

Citation: 839 P.2d 1192

Docket Number: 19019

Court Abbreviation: Idaho