Mansfield et al v. Federal Land Bank of Omaha et al

Filing 47

MEMORANDUM AND ORDER - In Case No. 4:14CV3232, Defendants' first motion for judgment on the pleadings 11 is granted, and Plaintiffs' action is dismissed with prejudice. Plaintiffs' motion for judgment on the pleadings 36 is den ied. Defendants' counterclaim is dismissed without prejudice, as moot. Defendants' second motion for judgment on the pleadings 45 is denied without prejudice, as moot. Final judgment shall be entered by separate document. In Case No. 4:14CV3233, Defendants' first motion for judgment on the pleadings 8 is granted, and all claims alleged by Plaintiffs against Defendants Federal Land Bank of Omaha, Farm Credit Bank of Omaha, and AgriBank, FCB, are dismissed with prejudice. Plaintiffs' motion for judgment on the pleadings 40 is denied. Defendants' counterclaim is dismissed without prejudice, as moot. Defendants' second motion for judgment on the pleadings 49 is denied without prejudice, as moot. Pu rsuant to Federal Rule of Civil Procedure 54(b), with the court finding no just reason for delay, final judgment shall be entered by separate document regarding all claims alleged against the banks. Pursuant to 28 U.S.C. § 1367(c)(3), this ca se is remanded to the District Court of Dawes County, Nebraska (Case No. CI 14-103). In Case No. 8:15CV26, Plaintiff's motion for judgment on the pleadings 26 is denied. Defendants' first motion for judgment on the pleadings 29 is gran ted, and Plaintiff's action is dismissed with prejudice. Defendants' counterclaim is dismissed without prejudice, as moot. Defendants' second motion for judgment on the pleadings 38 is denied without prejudice, as moot. Final judgment shall be entered by separate document. Member Cases: 4:14-cv-03232-RGK-CRZ, 4:14-cv-03233-RGK-CRZ, 8:15-cv-00026-RGK-CRZ. Ordered by Senior Judge Richard G. Kopf. (SLP)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEBRASKA

CALVIN M. MANSFIELD et al.,
Plaintiffs,
v.
FEDERAL LAND BANK OF
OMAHA, et al.,
Defendants.

CALVIN M. MANSFIELD et al.,
Plaintiffs,
v.
FEDERAL LAND BANK OF
OMAHA, et al.,
Defendants.
LARRY RICE,
Plaintiff,
v.
FEDERAL LAND BANK OF
OMAHA, et al.,
Defendants.

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Case No. 4:14CV3232
(Consolidated - Lead Case)

Case No. 4:14CV3233
(Consolidated - Member Case)

Case No. 8:15CV26
(Consolidated - Member Case)

MEMORANDUM AND ORDER

These consolidated cases, which were removed from state court based on
federal officer jurisdiction under 28 U.S.C. § 1442(a)(1), involve the interpretation
of Nebraska’s dormant mineral statutes, Neb. Rev. Stat. §§ 57-228 to 57-231.1 The
plaintiffs allegedly own certain tracts of land located in northwest Nebraska. The
Federal Land Bank of Omaha (“FLB”) transferred these properties in 1941 (Case Nos.
4:14CV3232 and 4:14CV3233) and 1986 (Case No. 8:15CV26), while retaining an
undivided one-half interest in the mineral rights. As the result of a series of mergers
between 1988 and 2003, these severed mineral interests are currently owned by
AgriBank, FCB (“AgriBank”). FLB and AgriBank are both named as defendants, as
is FLB’s immediate successor-in-interest, Federal Credit Bank of Omaha (“FCB”).2
The plaintiffs contend the mineral interests are abandoned under Nebraska law
because, although verified claims have been recorded by FLB, FCB, and AgriBank,
no documents proving AgriBank’s successor-in-interest status are on record at the
register of deeds. The defendants dispute that Nebraska law imposes such a recording
requirement, and argue it is sufficient that AgriBank’s successor-in-interest status is
a matter of public record under federal law. They also argue federal preemption. By
way of a counterclaim, the defendants seek a declaratory judgment quieting title in
favor of AgriBank.

1

In denying the plaintiffs’ motions to remand, the court found that the
defendant banks were acting under the direction of the Farm Credit Administration
and had stated a colorable federal defense because the purposes of the Farm Credit Act
could be frustrated if the Nebraska statutes resulted in the forfeiture of the banks’
ownership of mineral interests (Case No. 4:14CV3232, Filing Nos. 25, 29).
2

An additional named defendant in Case No. 4:14CV3233 is Mary Rasmussen,
who is alleged to the be record owner of an undivided one-half interest in certain
mineral rights. Although attorneys with the Husch Blackwell law firm have entered
appearances on behalf of all defendants in that case (Filing Nos. 7, 35), this appears
to have been done in error because the firm has only filed pleadings and motions on
behalf of AgriBank, FLB, and FCB. Thus, any references in this memorandum and
order to “the defendants” are not intended to include Ms. Rasmussen.
-2-

Both sides have moved for judgment on the pleadings pursuant to Federal Rule
of Civil Procedure 12(c). For the reasons discussed below, the defendants’ motions
seeking dismissal of the plaintiffs’ claims will be granted, and the plaintiffs’ crossmotions will be denied. The defendants’ counterclaims for declaratory relief will be
dismissed without prejudice, as moot.
I. Procedural History
A. Case No. 4:14CV3232
Case No. 4:14CV3232 was commenced in the District Court of Sioux County,
Nebraska, on October 23, 2014, by Calvin M. Mansfield and Sandra K. Mansfield.
On November 25, 2014, the defendants removed the action to this court and filed an
answer. On December 15, 2014, the defendants filed a Rule 12(c) motion (Filing No.
11). On August 21, 2015, the plaintiffs filed a Rule 12(c) motion (Filing No. 36).3
The defendants filed a counterclaim with prior leave of court on August 28,
2015. The plaintiffs answered the counterclaim on September 11, 2015. On October
6, 2015, the defendants filed a Rule 12(c) motion with respect to their counterclaim
(Filing No. 45). The plaintiffs have not filed a cross-motion on the counterclaim.
B. Case No. 4:14CV3233
Case No. 4:14CV3233 was commenced in the District Court of Dawes County,
Nebraska, on October 28, 2014, by Calvin M. Mansfield and Sandra K. Mansfield,
who are also the plaintiffs in Case No. 4:14CV3232. On November 25, 2014, the
defendants removed the action to this court and filed an answer. On December 15,
3

In the interim, the plaintiffs filed a motion to remand (on December 24, 2014),
which was denied (on July 28, 2015), and a motion for voluntary dismissal (on August
3, 2015). The plaintiffs’ motion to dismiss was denied on October 6, 2015.
-3-

2014, the defendants filed a Rule 12(c) motion (Filing No. 8). On August 21, 2015,
the plaintiffs filed a Rule 12(c) motion (Filing No. 40).4
The defendants filed a counterclaim with prior leave of court on August 28,
2015. The plaintiffs answered the counterclaim on September 11, 2015. On October
6, 2015, the defendants filed a Rule 12(c) motion with respect to their counterclaim
(Filing No. 49). The plaintiffs have not filed a cross-motion on the counterclaim.
C. Case No. 8:15CV26
Case No. 8:15CV26 was commenced in the District Court of Sioux County,
Nebraska, on December 9, 2014, by Larry L. Rice, who is represented by one of the
same law firms as the Mansfields. On January 16, 2015, the defendants removed the
action to this court, answered, and filed an unopposed motion to consolidate the three
cases. On August 21, 2015, the plaintiff filed a Rule 12(c) motion (Filing No. 26).5 On
August 31, 2015, the defendants filed a Rule 12(c) motion (Filing No. 29).
The defendants filed a counterclaim with prior leave of court on August 28,
2015. The plaintiff answered the counterclaim on September 11, 2015. On October
6, 2015, the defendants filed a Rule 12(c) motion with respect to their counterclaim
(Filing No. 38). The plaintiff has not filed a cross-motion on the counterclaim.

4

In the interim, as in Case No. 4:14CV3232, the plaintiffs filed a motion to
remand (on December 24, 2014), which was denied (on July 28, 2015), and a motion
for voluntary dismissal (on August 3, 2015). The plaintiffs’ motion to dismiss was
denied on October 6, 2015.
5

In the interim, as in Case Nos. 4:14CV3232 and 4:14CV3233, the plaintiff
filed a motion to remand (on January 21, 2015), which was denied (on July 28, 2015),
and a motion for voluntary dismissal (on August 3, 2015). The plaintiff’s motion to
dismiss was denied on October 6, 2015.
-4-

II. Applicable Nebraska Statutes
“Generally, dormant mineral statutes were enacted to address title problems
that developed after mineral estates were fractured. At common law, mineral interests
could not be abandoned. But permanent or long-term mineral interests could be
created during a period of activity in a particular industry, and those interests did not
terminate when the activity ceased. So, the mineral estate could be held by owners
who had long disappeared from the area, leaving no trace. When the record owner of
severed mineral interests could not be contacted, the dormant interests could cloud the
titles of surface owners, and further development of the mineral estates became nearly
impossible. Legislatures sought to remedy some of those problems by enacting
statutes to reunite dormant mineral estates with surface estates.” Ricks v. Vap, 784
N.W.2d 432, 434 (Neb. 2010) (footnotes omitted). “Nebraska’s dormant mineral
statutes are representative of those concerns.” Id.
These statutes, which have not been amended since their passage in 1967, see
Nebraska Laws 1967, ch. 348, §§ 1-4, provide as follows:
Any owner or owners of the surface of real estate from which a
mineral interest has been severed, on behalf of himself and any other
owners of such interest in the surface, may sue in equity in the county
where such real estate, or some part thereof, is located, praying for the
termination and extinguishment of such severed mineral interest and
cancellation of the same of record, naming as parties defendant therein
all persons having or appearing to have any interest in such severed
mineral interest, and if such parties defendant are not known and cannot
be ascertained, they may be proceeded against as unknown defendants
under the provisions of Chapter 25, article 3.
Neb. Rev. Stat. § 57-228.
A severed mineral interest shall be abandoned unless the record
owner of such mineral interest has within the twenty-three years
immediately prior to the filing of the action provided for in sections
-5-

57-228 to 57-231, exercised publicly the right of ownership by (1)
acquiring, selling, leasing, pooling, utilizing, mortgaging, encumbering,
or transferring such interest or any part thereof by an instrument which
is properly recorded in the county where the land from which such
interest was severed is located; or (2) drilling or mining for, removing,
producing, or withdrawing minerals from under the lands or using the
geological formations, or spaces or cavities below the surface of the
lands for any purpose consistent with the rights conveyed or reserved in
the deed or other instrument which creates the severed mineral interest;
or (3) recording a verified claim of interest in the county where the lands
from which such interest is severed are located. Such a claim of interest
shall describe the land and the nature of the interest claimed, shall
properly identify the deed or other instrument under which the interest
is claimed, shall give name and address of the person or persons
claiming the interest, and shall state that person or persons claim the
interest and do not intend to abandon the same.
Neb. Rev. Stat. § 57-229.
If the court shall find that the severed mineral interest has been
abandoned, it shall enter judgment terminating and extinguishing it,
canceling it of record, and vesting the title thereto in the owner or owners
of the interest in the surface from which it was originally severed in the
proportions in which they own such interest in the surface.
Neb. Rev. Stat. § 57-230.
In any action filed within two years after October 23, 1967, the
owner of a severed mineral interest may enter his appearance and assert
his interest therein, and he shall be deemed thereby to have timely and
publicly exercised his right of ownership.
Neb. Rev. Stat. § 57-231.
“It is consistent with the statutory purpose of preventing abandonment of
mineral estates to require an absent owner of dormant mineral interests to actively
exercise those interests. And the plain language of § 57–229 provides that a severed
-6-

mineral interest is abandoned unless the record owner of the interest is the one who
publicly exercises it.” Ricks, 784 N.W.2d at 436.
“As to ‘record owner,’ [the Nebraska Supreme Court has] declined to adopt a
rule of liberal or strict interpretation of the dormant mineral interest statutes. But [the
Court has] noted that an action to terminate severed mineral interests sounds in equity
and that equity abhors forfeitures. Thus, . . . if doubt remain[s] about the meaning of
‘record owner,’ it should be construed against forfeiture.” Fisher v. Heirs & Devisees
of T.D. Lovercheck, 864 N.W.2d 212, 217 (Neb. 2015).
III. Undisputed Facts
A. Case No. 4:14CV3232
In a “Deed of Land” dated March 26, 1941, and recorded in the office of the
Register of Deeds of Sioux County, Nebraska, in April 1941,6 FLB conveyed to
Lawrence M. Hewett a tract of land in Sioux County described as the “Southeast
Quarter of Section 1, in Township 29 North, Range 53,West of the 6th Principal
Meridian, ... excepting therefrom one-half of all oil, gas and other mineral rights”
(Complaint [Filing No. 1-1 at CM/ECF pp. 11-13]; Answer [Filing No. 3] ¶ 2 & Ex.
A [Filing No. 3-1]; Counterclaim [Filing No. 38], ¶23 & Ex. A [Filing No. 38-1]).
The plaintiffs in Case No. 14CV3232, Calvin M. Mansfield and Sandra K.
Mansfield, claim to be the record owners of such real estate (Complaint, ¶ 1; Answer
to Counterclaim, ¶ 4). The defendants do not admit this claim of ownership.7
6

The plaintiffs allege the deed was “recorded April 11, 1941 in Deed Book X,
Page 19” (Complaint, ¶ 2). The defendants admit the deed was “recorded April 1941
in Deed Book X, Page 19 & 20 (Answer, ¶ 2).
7

As evidence of their ownership interest, the Mansfields have only produced
a copy of a warranty deed dated January 14, 2005, in which they convey the property
-7-

The plaintiffs allege that FLB is the record owner of the severed mineral interest
(Complaint, ¶ 2). The defendants admit that FLB was the record owner until FLB was
merged into FCB in 1988 (Answer, ¶ 2).
FLB’s “Verified Claim of Severed Mineral Interest,” dated July 2, 1969, was
recorded in the office of the Register of Deeds of Sioux County, Nebraska, on
August 5, 1969, at Misc. Book A-30, Page 420 (Complaint, ¶2; Answer, ¶ 2;
Counterclaim, ¶ 25; Answer to Counterclaim, ¶ 25). The verified claim states:
The Federal Land Bank of Omaha, 206 South 19 Street, Omaha,
Nebraska, claims an undivided one-half interest in and to the oil, gas,
and minerals in the following-described premises in Sioux County,
Nebraska:
SE¼ Sec. 1-29N-53, West of the 6th P.M.
which said interest was reserved by claimant in a deed dated March 26,
1941 conveying the described premises to Lawrence M. Hewitt [sic] and
recorded in Book X, Page 19 & 20, of the deed records of said County.
This claim is made under the provisions of Chapter 348 of the Laws of
1967 for the purposes of preserving such severed interest and to verify
that claimant has no intention to abandon the same.
(Id.; Answer Ex. A [Filing No. 3-3]; Counterclaim Ex. C [Filing No. 38-3]).
Effective July 6, 1988, FLB was merged into Federal Credit Bank of Omaha
(“FCB”). The charter issued by the Farm Credit Administration (“FCA”) states:

to themselves as joint tenants with rights of survivorship (Answer to Counterclaim,
¶ 4 & Ex. B [Filing No. 44-2]).
-8-

The Farm Credit Administration, in accordance with section 1.3 of the
Farm Credit Act of 1971, as amended (the Act),8 hereby charters a bank
established pursuant to the merger of the Federal Land Bank of Omaha
and the Federal Intermediate Credit Bank of Omaha, as provided by
section 410 of the Agricultural Credit Act of 1987,9 to be known as the
FARM CREDIT BANK OF OMAHA (the Bank). The principal office
location of the Bank shall be in the City of Omaha, County of Douglas,
State of Nebraska. The Bank is an institution of the Farm Credit System
and a federally charted instrumentality. The territory to be served by the
Bank shall be all of the States of Iowa, Nebraska, South Dakota, and
Wyoming.
By this Federal charter, the Farm Credit Administration hereby
authorizes the Bank to exercise all powers conferred on the Bank under
the Act and the regulations of the Farm Credit Administration.
(Answer, ¶ 2 & Ex. B [Filing No. 3-2]; Counterclaim, ¶ 26 & Ex. D [Filing No. 38-4];
Answer to Counterclaim, ¶ 26).10
FCB’s “Verified Claim of Severed Mineral Interest,” dated February 19, 1992,
was recorded in the office of the Register of Deeds of Sioux County, Nebraska on
March 4, 1992, at Misc. Book A-55, Page 504, and states:

8

Section 1.3 of the Farm Credit Act is codified at 12 U.S.C. § 2011. Among
other things, it provides that “[t]he banks established pursuant to the merger of each
District Federal Intermediate Credit Bank and Federal Land Bank (...“Farm Credit
Banks”), as provided in section 410 of the Agricultural Credit Act of 1987, shall be
Federally chartered instrumentalities of the United States,” and that “[t]he Farm Credit
Administration shall ... issue charters for, and approve amendments to charters of, the
Farm Credit Banks.” 12 U.S.C. § 2011(a)&(b).
9

The Agricultural Credit Act of 1987 required that “the Federal land bank and
the Federal intermediate credit bank of each district shall merge into a Farm Credit
Bank ....” Pub.L. No. 100-233, § 410(a).
10

The facts stated in this paragraph apply to all three cases.
-9-

The Farm Credit Bank of Omaha, successor in interest to the Federal
Land Bank of Omaha, 206 South 19th Street, Omaha, Nebraska 68102,
claims a 50.00% interest in and to the oil, gas, and minerals in the
following described premises in Sioux County, NEBRASKA, Township
029 North, Range 063 West of the 6th Principal Meridian Section 01:
SE4
This interest was reserved by the claimant in a deed which conveyed the
described premises. The particulars of the conveyance are as follows:
Deed dated
Recorded on
Recorded in
Instrument #
Issued to

03/26/1941
BK X, PG 19
Lawrence M. Hewett

This claim is made under the provisions of NEBRASKA Statute, Neb
Rev Stat 57-229 for the purpose of preserving such severed interest and
to verify that the claimant has no intention to abandon the same.
(Complaint, ¶ 3; Answer, ¶ 3 & Ex. C [Filing No. 3-3]; Counterclaim, ¶ 30 & Ex. H
[Filing No. 38-8]; Answer to Counterclaim, ¶ 30).
On April 1, 1994, FCB merged into AgAmerica, FCB (“AgAmerica”), a
federally chartered instrumentality, at which time AgAmerica became the successorin-interest to FCB (Answer, ¶ 3; Counterclaim, ¶¶ 32, 33; Answer to Counterclaim,
¶¶ 32, 33). AgAmerica’s charter from the FCA states:
The Farm Credit Administration, in accordance with section 1.3 of the
Farm Credit Act of 1971, as amended (the Act), hereby charters a Farm
Credit Bank to be known as AgAmerica, FCB (the Bank), established
pursuant to the consolidation of the Farm Credit Bank of Omaha and the
Farm Credit Bank of Spokane, in accordance with section 7.12 of the

-10-

Act.11 The principal office location of the Bank shall be in the City of
Spokane, County of Spokane, State of Washington. The Bank is an
institution of the Farm Credit System and a federally charted
instrumentality.
By this Federal charter, the Farm Credit Administration hereby
authorizes said Bank to exercise all powers conferred on the Bank under
the Act and the regulations of the Farm Credit Administration within the
following territory:
All the States of Alaska, Idaho, Montana, Nebraska,
Oregon, South Dakota, Washington, and Wyoming.
(Id.; Answer Ex. D [Filing No. 3-4]; Counterclaim Ex. J [Filing No. 38-10]). There
is no evidence that AgAmerica recorded any verified claims for any of the mineral
interests that are involved in these cases.
AgriBank was charted by the FCA on May 1, 1992. Its charter, which is
substantially similar to AgAmerica’s charter, states:
The Farm Credit Administration, in accordance with section 1.3 of the
Farm Credit Act of 1971, as amended (the Act), hereby charters a Farm
Credit Bank to be known as AgriBank, FCB (the Bank), established
pursuant to the consolidation of the Farm Credit Bank of St. Paul and the
Farm Credit Bank of St. Louis, in accordance with section 7.12 of the
Act. The principal office location of the Bank shall be in the City of St.
Paul, County of Ramsey, State of Minnesota. The Bank is an institution
of the Farm Credit System and a federally charted instrumentality.

11

Section 7.12 of the Act is codified at 12 U.S.C. § 2279f. “Banks organized
or operating under [United States Code Title 12, Chapter 23] may merge with banks
in other districts operating under the same subchapter if the plan of merger is
approved by—(1) the Farm Credit Administration Board;(2) the respective Boards of
Directors of the banks involved; [and] (3) a majority vote of the stockholders of each
bank ....” 12 U.S.C. § 2279f (a).
-11-

By this Federal charter, the Farm Credit Administration hereby
authorizes said Bank to exercise all powers conferred on the Bank under
the Act and the regulations of the Farm Credit Administration within the
following territory:
All the States of Arkansas, Illinois, Michigan, Minnesota,
Missouri, North Dakota, and Wisconsin.
(Counterclaim, ¶ 34 & Ex. K [Filing No. 38-11]; Answer to Counterclaim, ¶ 34).
Effective January 1, 2003, the FCA approved the merger of AgAmerica into
AgriBank, and amended AgriBank’s charter to include AgAmerica’s former territory
of Nebraska (Answer, ¶ 4 & Ex. E [Filing No. 3-5]; Counterclaim ¶ 35 & Ex. L
[Filing No. 38-12], M [Filing No. 38-13]; Answer to Counterclaim, ¶ 35). With the
merger, AgriBank became the successor-in-interest to AgAmerica (Counterclaim, ¶
37; Answer to Counterclaim, ¶ 37).12
AgriBank’s “Verified Claim of Severed Mineral Interest,” dated July 7, 2014,
was recorded in the office of the Register of Deeds of Sioux County, Nebraska, on
July 14, 2014, at Misc. Book A-66, Pages 593-94 (Complaint, ¶ 4; Answer, ¶ 4;
Counterclaim, ¶ 39; Answer to Counterclaim, ¶ 39). The verified claim states:
AGRIBANK, FCB, a federally chartered corporation, and
successor in interest to AgAmerica, FCB, the successor in interest to The
Federal Land Bank of Omaha and the Farm Credit Bank of Omaha,
whose address is 30 East 7th Street, Suite 1600, St. Paul, Minnesota
55101, HEREBY VERIFIES AND STATES:
1.

12

That it claims severed mineral interests in the following described
real property in Sioux County, Nebraska:

The facts stated in this and the preceding two paragraphs apply to all three

cases.
-12-

See Exhibit A attached hereto and made a part hereof, consisting
of 1 page(s) [which includes the subject property and indicates the
mineral interest is reserved in a deed issued to Lawrence M.
Hewett on March 26, 1941, and recorded at Book X, Page 19]
2.

That mineral interest was reserved by claimant in a deed which
conveyed the premises. That said deed(s) is recorded in the Office
of the Register. of Deeds for said County as described in the
attached Exhibit A.

3.

That AgriBank is still the owner and holder of said reserved
severed mineral interest; that it claims all rights secured
thereunder and the undersigned verifies that AgriBank has no
intention to abandon the same.

4.

That this claim is made and filed for record pursuant to the
provisions of Nebraska Revised Statute §57-229, for the purpose
of preserving and keeping effective such claimed right, title and
interest.

(Id.; Answer Ex. F [Filing No. 3-6]; Counterclaim Ex. P [Filing No. 38-16]).
B. Case No. 4:14CV3233
In the March 26, 1941“Deed of Land” referenced above, FLB also conveyed
to Lawrence M. Hewett a tract of land in Dawes County, Nebraska, described as the
“Southwest Quarter of Section 6, and Northwest Quarter (except a one-acre school
site ...) of Section 7, all in Township 29 North, Range 52,West of the 6th Principal
Meridian, ... excepting therefrom one-half of all oil, gas and other mineral rights”
(Complaint [Filing No. 1-1], ¶ 3; Answer [Filing No. 3], ¶ 3; Counterclaim [Filing No.
42], ¶ 23 & Ex. A [Filing No. 42-1]; Answer to Counterclaim [Filing No. 48], ¶ 23).
The deed was recorded in the office of the Register of Deeds of Dawes County on
April 23, 1941, at Deed Book 56, Page 505 (id.).

-13-

The plaintiffs in Case No. 4:14CV3233, who are also the plaintiffs in Case No.
4:14CV3232, Calvin M. Mansfield and Sandra K. Mansfield, claim to be the record
owners of the North Half (N½) of the Southwest Quarter (SW¼) of Section 6, and the
Northwest Quarter (NW¼) of Section 7, Township 29 North, Range 52 West of the
6th P.M., Dawes County, Nebraska (Complaint, ¶ 1).13 As in Case No. 4:14CV3232,
the defendants do not admit this claim of ownership.14
The plaintiffs allege that FLB is the record owner of the severed mineral interest
(Complaint, ¶ 3). The defendants admit that FLB was the record owner until FLB was
merged into FCB in 1988 (Answer, ¶ 3).
FLB’s “Verified Claim of Severed Mineral Interest,” dated July 2, 1969, was
recorded in the office of the Register of Deeds of Dawes County, Nebraska, on
August 5, 1969, at Book 22 O&G, Page 311 (Complaint, ¶ 4; Answer ¶ 4;
Counterclaim, ¶ 24; Answer to Counterclaim, ¶ 24). The verified claim states:
The Federal Land Bank of Omaha, 206 South 19 Street, Omaha,
Nebraska, claims an undivided one-half interest in and to the oil, gas,

13

The Mansfields do not claim an ownership interest in the South Half (S½) of
the Southwest Quarter (SW¼) of Section 6.
14

The only proof of ownership the Mansfields have produced is a copy of a
warranty deed dated November 10, 2004, in which they convey the North Half (N½)
of the Southwest Quarter (SW¼) of Section 6 to themselves as joint tenants with
rights of survivorship (Answer to Counterclaim, ¶ 4 & Ex. A [Filing No. 48-1]). The
Mansfields also claim to own portions of Section 31, Township 30 North, Range 52
West of the 6th P.M. in Dawes County, Nebraska, which are conveyed in the same
deed. With regard to this S31-T30N-R52W6 property, it is alleged that “Mary
Rasmussen is the record owner of an undivided ½ interest in all mineral, gas and oil
rights reserved for her lifetime through a Deed dated December 30, 1949, and
recorded January 24, 1950, in Deed Book 65, page 488, in the office of the Register
of Deeds, Dawes County, Nebraska” (Complaint, ¶ 2).
-14-

and minerals in the following-described premises in Dawes County,
Nebraska:
SW¼ Section 6; and NW¼ Section 7; All in 29N-52, West of the
6th P.M. Except 1 acre for school
which said interest was reserved by claimant in a deed dated April 23,
1941 [sic]15 conveying the described premises to Lawrence M. Hewett
and recorded in Book 56, Page 505, of the deed records of said County.
This claim is made under the provisions of Chapter 348 of the Laws of
1967 for the purposes of preserving such severed interest and to verify
that claimant has no intention to abandon the same.
(Id.; Answer Ex. B [Filing No. 3-2]; Counterclaim Ex. B [Filing No. 42-2]).
Two “Verified Claim[s] of Severed Mineral Interest,” dated February 19, 1992,
were recorded by FCB in the office of the Register of Deeds of Dawes County,
Nebraska, on March 2, 1992, at Book 38 O&G, Pages 88 and 117 (Complaint, ¶¶ 5,
6; Answer, ¶¶ 5, 6; Counterclaim, ¶ 29; Answer to Counterclaim, ¶ 29). The format
of the verified claims is identical; they differ only as to the property descriptions:
The Farm Credit Bank of Omaha, successor in interest to the Federal
Land Bank of Omaha, 206 South 19th Street, Omaha, Nebraska 68102,
claims a 50.00% interest in and to the oil, gas, and minerals in the
following described premises in DAWES County, NEBRASKA,
Township 029 North, Range 052 West of the 6th Principal Meridian
Section 06: SW4
[Township 029 North, Range 052 West of the 6th Principal Meridian
Section 07: NW4]

15

The deed was recorded April 23, 1941, but was dated March 26, 1941.
-15-

This interest was reserved by the claimant in a deed which conveyed the
described premises. The particulars of the conveyance are as follows:
Deed dated
Recorded on
Recorded in
Instrument #
Issued to

03/26/1941
BK 56, PG 505
Lawrence M. Hewett

This claim is made under the provisions of NEBRASKA Statute, Neb
Rev Stat 57-229 for the purpose of preserving such severed interest and
to verify that the claimant has no intention to abandon the same.
(Answer Ex. C [Filing No. 3-3], Ex. D [Filing No. 3-4]; Counterclaim, ¶ 29 & Ex. F
[Filing No. 42-6], Ex. G [Filing No. 42-7]).
On February 13, 2003, AgriBank filed for record in the office of the Register
of Deeds of Dawes County, Nebraska, an “Affidavit of Merger of AgAmerica and
AgriBank in the State of Nebraska” in which AgriBank’s general counsel affirmed
that AgAmerica and AgriBank had “entered into an Agreement and Plan of Merger
dated October 10, 2002, which agreement has been duly approved by the board of
directors of both corporations, the stockholders of both corporations and the Farm
Credit Administration, the federal regulator of both corporations,” that “[p]ursuant to
the Agreement and Plan of Merger, AgAmerica, FCB has merged with and into
AgriBank, FCB, the surviving merged corporation, effective January 1, 2003,” and
that “AgriBank, FCB, as the surviving merged corporation, possesses all of the rights
of, is vested with title to all the property and other assets of, and is responsible for all
of the obligations of the former AgAmerica, FCB” (Answer, ¶ 7 & Ex. F [Filing No.
3-6]; Counterclaim, ¶ 36 & Ex. N [Filing No. 42-14]; Answer to Counterclaim, ¶
36).16 The referenced “Agreement and Plan of Merger” is not in evidence.

16

It has not been shown that a similar affidavit was filed in Sioux County.
-16-

AgriBank’s “Verified Claim of Severed Mineral Interest,” dated September 30,
2014, was recorded in the office of the Register of Deeds of Dawes County, Nebraska,
on October 20, 2014 (Complaint, ¶ 7; Answer, ¶ 7; Counterclaim, ¶ 38; Answer to
Counterclaim, ¶ 38). The verified claim is nearly identical to the one that was recorded
in Sioux County regarding the mineral interests involved in Case No. 4:14CV3232,
but the attached “Exhibit A” lists Dawes County properties:
AGRIBANK, FCB, a federally chartered corporation, and
successor in interest to AgAmerica, FCB, the successor in interest to The
Federal Land Bank of Omaha and the Farm Credit Bank of Omaha,
whose address is 30 East 7th Street, Suite 1600, St. Paul, Minnesota
55101, HEREBY VERIFIES AND STATES:
1.

That it claims severed mineral interests in the following described
real property in Dawes County, Nebraska:
See Exhibit A attached hereto and made a part hereof, consisting
of 1 page(s) [which includes the subject property and indicates the
mineral interest is reserved in deeds issued to Lawrence M.
Hewett on March 26, 1941, and recorded at Book 56, Page 505]

2.

That mineral interest was reserved by claimant in a deed which
conveyed the premises. That said deed(s) is recorded in the Office
of the Register. of Deeds for said County as described in the
attached Exhibit A.

3.

That AgriBank is still the owner and holder of said reserved
severed mineral interest; that it claims all rights secured
thereunder and the undersigned verifies that AgriBank has no
intention to abandon the same.

4.

That this claim is made and filed for record pursuant to the
provisions of Nebraska Revised Statute §57-229, for the purpose
of preserving and keeping effective such claimed right, title and
interest.

(Id.; Answer Ex. G [Filing No. 3-7]; Counterclaim Ex. O [Filing No. 42-15]).
-17-

C. Case No. 8:15CV26
On February 26, 1986, FLB quitclaimed to Larry L. Rice, the plaintiff in Case
No. 8:15CV26, a tract of land in Sioux County, Nebraska, described as “S½ SE¼ of
Section 25, Township 24 North, Range 58, West of 6th P.M., ... [e]xcepting and
reserving to the grantor and its assigns an undivided one-half interest in all oil, gas,
and mineral interests, including geothermal resources” (Complaint [Filing No. 1-1 at
CM/ECF pp. 9-11], ¶ 2; Answer [Filing No. 4], ¶ 2 & Ex. A [Filing No. 4-1];
Counterclaim [Filing No. 28], ¶ 28 & Ex. E [Filing No. 28-5]). This “Corporation
Quitclaim Deed” was recorded in the office of the Register of Deeds of Sioux County,
Nebraska, on April 4, 1986, at Deed Record A-16, Page 72 (id.).
The plaintiff alleges that he is the record owner of the above-described real
estate; the defendants deny this allegation (Complaint, ¶ 1; Answer, ¶ 1). The plaintiff
further alleges that there is a “Warranty Deed that vests ownership of the surface
estate” in himself, but only the document he has produced in support of this allegation
is the February 26, 1986 quitclaim deed from FLB (Answer to Counterclaim [Filing
No. 37], ¶ 28 & Ex. C [Filing No. 37-3]).
The plaintiff alleges that FLB is the record owner of the severed mineral interest
(Complaint, ¶ 2). The defendants admit that FLB was the record owner until FLB was
merged into FCB in 1988 (Answer, ¶ 2).
FCB’s “Verified Claim of Severed Mineral Interest,” dated February 19, 1992,
was recorded in the office of the Register of Deeds of Sioux County, Nebraska, on
March 4, 1992, at Misc. Book A-55, Page 503, and states:
The Farm Credit Bank of Omaha, successor in interest to the Federal
Land Bank of Omaha, 206 South 19th Street, Omaha, Nebraska 68102,
claims a 50.00% interest in and to the oil, gas, and minerals in the
following described premises in Sioux County, NEBRASKA,

-18-

Township 024 North, Range 058 West of the 6th Principal Meridian
Section 25: S2SE4
This interest was reserved by the claimant in a deed which conveyed the
described premises. The particulars of the conveyance are as follows:
Deed dated
Recorded on
Recorded in
Instrument #
Issued to

02/26/1986
04/04/1986
BK A-16, PG 72
Larry L. Rice

This claim is made under the provisions of NEBRASKA Statute, Neb
Rev Stat 57-229 for the purpose of preserving such severed interest and
to verify that the claimant has no intention to abandon the same.
(Answer, ¶ 2 & Ex. C [Filing No. 4-3]; Counterclaim, ¶ 31 & Ex. I [Filing No. 28-9];
Answer to Counterclaim, ¶ 31)
AgriBank’s “Verified Claim of Severed Mineral Interest,” dated July 7, 2014,
was recorded in the office of the Register of Deeds of Sioux County, Nebraska, on
July 14, 2014, at Misc. Book A-66, Pages 593-94 (Complaint, ¶ 3; Answer, ¶ 3 & Ex.
F [Filing No. 4-6]; Counterclaim, ¶ 40 & Ex. P [Filing No. 28-16]; Answer to
Counterclaim, ¶ 40). This is the same verified claim that is involved in Case No.
4:14CV3232; the attached “Exhibit A” includes the subject property and indicates the
mineral interest is reserved in a deed issued to Larry L. Rice on February 26, 1986,
and recorded at Book A-16, Page 72 (id.).
IV. Motions for Judgment on the Pleadings
A. Legal Standard
“After the pleadings are closed—but early enough not to delay trial—a party
may move for judgment on the pleadings.” Fed. R.Civ. P. 12(c). A Rule 12(c) motion
-19-

for judgment on the pleadings is evaluated in the same fashion as a Rule 12(b)(6)
motion to dismiss for failure to state a claim. See Greenman v. Jessen, 787 F.3d 882,
887 (8th Cir. 2015). “The grant of either motion is ‘appropriate only when there is no
dispute as to any material facts and the moving party is entitled to judgment as a
matter of law.’” Id. (quoting Ashley County, Ark. v. Pfizer, Inc., 552 F.3d 659, 665
(8th Cir. 2009)). “A court generally may not consider materials outside the pleadings
when deciding a motion to dismiss for failure to state a claim or for judgment on the
pleadings.” Id. “Courts may, however, consider ‘some materials that are part of the
public record or do not contradict the complaint, as well as materials that are
necessarily embraced by the pleadings.’” Id. (quoting Porous Media Corp. v. Pall
Corp., 186 F.3d 1077, 1079 (8th Cir. 1999)).
B. Plaintiffs’ Motions
In answering, the defendants state they are without knowledge or information
sufficient to admit or deny whether the plaintiffs are the record owners of the subject
real estate, and they therefore deny the plaintiffs’ allegations of ownership. The
documents that have been produced by the plaintiffs are not conclusive of this issue.
Consequently, because it cannot be determined from the pleadings and attachments
that the plaintiffs have standing to sue under Neb. Rev. Stat. § 57-228, their Rule
12(c) motions must be denied. The plaintiffs’ motions fail in any event because the
defendants’ cross-motions will be granted.
C. Defendants’ Motions Regarding Plaintiffs’ Complaints
One method by which the “record owner” of a severed mineral interest can
publicly exercise the right of ownership, and thereby prevent abandonment of the
interest, is by recording a verified claim in the county where the lands from which
such interest is severed are located. Neb. Rev. Stat. § 57-229(3). “Such a claim of
interest shall describe the land and the nature of the interest claimed, shall properly
identify the deed or other instrument under which the interest is claimed, shall give
-20-

name and address of the person or persons claiming the interest, and shall state that
person or persons claim the interest and do not intend to abandon the same.” Id.
While it is undisputed that AgriBank has owned the mineral interests that are
the subject of these lawsuits since 2003, when it merged with AgAmerica, and that
AgriBank recorded verified claims of interest in Sioux County and Dawes County in
2014, before the suits were filed, the plaintiffs dispute that AgriBank is the “record
owner” of the mineral interests within the meaning of Section 57-229. They contend
that according to the records maintained in the office of the register of deeds in each
county, the owner of the mineral interests is shown to be FLB, which had not publicly
exercised ownership of the interests for at least 23 years preceding the filing of the
lawsuits. With respect to Case Nos. 4:14CV3232 and 4:14CV3233, FLB last filed
verified claims for the mineral interests in August 1969, more than 45 years before
suit was filed. In Case No. 8:15CV26, the deed in which FLB reserved the mineral
interest was executed in February 1986, more than 28 years before suit was filed.
The meaning of the term “record owner” as used in Section 57-229 has been
addressed by the Nebraska Supreme Court in three recent cases: Gibbs Cattle Co. v.
Bixler, 831 N.W.2d 696 (Neb. 2013); WTJ Skavdahl Land LLC v. Elliott, 830 N.W.2d
488 (Neb. 2013); and Rice v. Bixler, 854 N.W.2d 565 (Neb. 2014).17
In Gibbs, which is the leading case, surface owner of various tracts of land in
Sioux County, Nebraska, brought suit under Neb. Rev. Stat. § 57-228 against the
owners of severed mineral interests in those tracts. One of the named defendants, John
Bixler, died in 1996 and had not publicly exercised his ownership rights in the mineral
interests in the 23 years prior to 2011, when suit was commenced against him. But his
widow and personal representative, Margaret, acquired a life estate in the mineral
interests through John’s will, which was probated in Sioux County. Margaret argued

17

The plaintiff in Rice is also the plaintiff in Case No. 8:15CV26.
-21-

that based on the probate records, she was the “record owner” of the mineral interests,
and that her 23 years had not yet elapsed.18
Gibbs argued, as do the plaintiffs in the present cases, “that the ‘record owner’
of mineral interests may be determined only from the register of deeds in the county
where the interests are located.” Gibbs, 831 N.W.2d at 700-01. The Nebraska
Supreme Court rejected this argument and “conclude[d] that ‘record owner’ should
be construed to include an owner identified through the probate records of the county
in which the mineral interests are located.”
Although the Court’s holding in Gibbs is limited, the decision generally
supports the defendants’ position in the present cases. The Court stated:
We give statutory language its plain and ordinary meaning.
Black’s Law Dictionary, which we have relied on in the past to define
the term, defines “record owner” as “[a] property owner in whose name
the title appears in the public records.” That does not resolve the issue
because it could be read to support either of the parties’ positions. We
must construe the term to give effect to the Legislature’s intent. We have
reviewed the legislative history of the dormant mineral statutes, but it is
scant and of little help in resolving the issue. . . .
...
Gibbs’ argument has some appeal, but we are unconvinced.
Section 57-229 sets forth various ways that the “record owner” may
publicly exercise his or her rights of ownership in certain mineral
interests. One way is by taking various actions with the interests through
“an instrument which is properly recorded in the county where the land
18

Margaret also argued in the district court that John’s transfer of the mineral
interests to her through his will was a public exercise of ownership, but she did not
pursue this argument on appeal. (The district court had rejected the argument,
reasoning that the transfer had occurred by operation of law rather than by John’s
action. See Gibbs, 831 N.W.2d at 698.)
-22-

from which such interest was severed is located.” Another way is by
“recording a verified claim of interest in the county where the lands from
which such interest is severed are located.” These are certainly different
avenues of publicly exercising ownership, but as Margaret noted in her
reply brief, that “language describes what a record owner can do to
protect [his or] her interest from being deemed abandoned. [But i]t does
not purport to tell us who the record owner is.”
The answer is not obvious. But we conclude that “record owner”
should be construed to include an owner identified through the probate
records of the county in which the mineral interests are located. We
reach this conclusion for several reasons. Most notably, the Legislature
narrowly defined the term “record owner” in [an unrelated statute] as
“the fee owner of real property as shown in the records of the register of
deeds office . . ..” That the Legislature narrowly defined “record owner”
in [that statute] indicates that it is not the ordinary meaning of the term.
And because the Legislature did not similarly define the term in the
dormant mineral statutes, it seems likely that the Legislature intended a
different and broader meaning for the term in § 57-229.
. . . Margaret was identified as an owner through probate records
in the county where the interests were located. Those qualify as public
records . . ..
Moreover, unlike the district court, we believe that this
construction is consistent with the language and purpose of the dormant
mineral statutes. It is consistent with the statutes’ language because the
Legislature did not see fit to narrowly define the term . . .. As to being
consistent with the statutes’ purpose, we acknowledge that the purpose
of the dormant mineral statutes was “to address title problems that
developed after mineral estates were fractured.” But the text of the
dormant mineral statutes also demonstrates that the Legislature balanced
this purpose with protecting owners’ property rights.
This balancing is evident from the statutes themselves.
Abandonment does not automatically occur after a set time, but only if
and when a surface owner files suit; it is relatively easy for a record
owner to publicly exercise his or her ownership rights; and the statutes
-23-

provide for a fairly lengthy 23-year period of nonuse before a record
owner’s rights may be deemed abandoned. Construing “record owner”
to include an owner identified through probate records in the county
where the interests are located is consistent with the dormant mineral
statutes’ purpose—it still allows for clearing title records. But that
construction also protects identifiable property rights. In other words,
much like the statutes themselves, this construction of “record owner”
balances the desire to clear title records with protecting identifiable
property rights.
Finally, we note that the parties take opposite stances on whether
we should apply a liberal or strict construction to “record owner.” Gibbs
argues that the dormant mineral statutes are remedial statutes and that
therefore, we must construe them liberally to fulfill their intended
purpose. Margaret, on the other hand, notes that the dormant mineral
statutes abrogate the common law against abandonment of real property
and that such statutes must be strictly construed. Here, we do not find
these interpretative canons helpful. But the dormant mineral statutes
result in a forfeiture of property, and “equity abhors forfeitures.” As this
is an equitable case, if any doubt remains as to the meaning of “record
owner,” it should be construed against forfeiture.
Id. at 701-03 (emphasis in original; footnotes omitted).
Elliott involved a very similar fact situation to Gibbs. The surface owner of land
in Sioux County, Nebraska, sued the owners of severed mineral interests in that land
under the dormant mineral statutes to acquire their allegedly abandoned interests. One
of the named defendants was Sandra Elliott, who was sued both personally and as the
personal representative of the estate of Evelyn Elliott, which was being probated in
Sioux County. Although Evelyn had died in 1999, the register of deeds still listed her
as the owner of the disputed mineral interests. Evelyn’s will devised all of her
property to the cotrustees of the “S & G Living Trust,” and Sandra was the last
surviving trustee. The Nebraska Supreme Court determined that Sandra was the
“record owner” of the mineral interests and that she had not abandoned the interest.
It again “conclude[d] that the ‘record owner’ of mineral interests, as used in § 57-229,
-24-

includes an individual identified by probate records in the county where the interests
are located.” Elliott, 830 N.W.2d at 490.
Finally, in Rice, the Nebraska Supreme Court declined to expand upon its
holdings in Gibbs and Elliott in order to give effect to verified claims that were
recorded in the office of the register of deeds in Sioux County, Nebraska, by the heirs
of the estate of a woman whose will was probated in Alabama. Because the Alabama
probate documents were not recorded in the office of the Sioux County register of
deeds or filed in the probate records of Sioux County before the plaintiff commenced
the action, the Court ruled that the heirs had “not established within the time required
by § 57-229 that they [were] the record owners of the mineral interests in question.”
Rice, 854 N.W.2d at 575.
Commenting on its holding in Gibbs, the Court stated that “[a]ny construction
of the term ‘record owner’ to include an owner whose interests were not recorded in
the county where the interests were located would not serve the purpose of clearing
title to dormant mineral interests in real estate located in such county.” Rice, 854
N.W.2d at 573. The Court “point[ed] out that the burden imposed by § 57-229 upon
the severed mineral owners is not great,” and concluded that “the record owner must
[strictly] comply with the requirements [for recording a verified claim as] set forth
in § 57-229(3).” Id. at 574 .19 Significantly, the Court did not hold in Rice that
the term “record owner” must be strictly construed, but instead adhered to its
determination in Gibbs that “any doubt as to the meaning of the term ‘record owner’
should be construed against forfeiture.” Id. at 573.
Because the Nebraska Supreme Court has not had occasion to apply § 57-229
to severed mineral interests that are owned by the surviving corporation of a series of
19

The Court in Rice also held that verified claims filed by other defendants did
not satisfy the requirements of § 57-229(3) because they failed to properly identify the
deed or other instrument under which their interests were claimed.
-25-

mergers between federally chartered corporations, this court must attempt to predict
what the Nebraska Supreme Court would decide if faced with the issue. See In re
Dittmaier, 806 F.3d 987, 989 (8th Cir. 2015). In so doing, the court may consider
“relevant state precedent, analogous decisions, considered dicta, . . . and any other
reliable data.” Id. (quoting In re Bargfrede, 117 F.3d 1078, 1080 (8th Cir. 1997) (per
curiam)). I conclude that AgriBank, like its predecessors in interest, is a “record
owner” for purposes of § 57-229, and that the verified claims it recorded satisfy the
requirements of that section.
Under Nebraska law, the articles of merger for domestic corporations are filed
with the Nebraska Secretary of State, see Neb. Rev. Stat. § 21-20,132, and, upon the
effective date of the articles, [t]he title to all real estate and other property owned by
each corporation party to the merger shall be vested in the surviving corporation
without reversion or impairment,” Neb. Rev. Stat. § 21-20,133(1)(b). “[W]hen two or
more corporations effect a merger or consolidation, the surviving corporation
possesses all the rights, privileges, immunities, and franchises, as well as all the
property—real, personal, and mixed, including the debts—of each of the merging
corporations, and any interest vested in any of such corporations shall not revert or be
in any way impaired by reason of such merger.” ADT Sec. Servs., Inc. v. A/C Sec. Sys.,
Inc., 736 N.W.2d 737, 757 (Neb. App. 2007) (quoting Kimco Addition v. Lower Platte
South N.R.D., 440 N.W.2d 456, 461 (Neb. 1989) (internal quotations and alterations
omitted). In short, title passes by operation of law, and is documented by a statewide
filing. The Nebraska Supreme Court would almost certainly hold that the surviving
corporation is a “record owner” for purposes of § 57-229, even though no record of
the merger is filed with the county.
The Nebraska Supreme Court has held that term “record owner” should be
given its ordinary meaning of “[a] property owner in whose name the title appears in
the public records,” and that “public records” are not limited to records that may be
found in the register of deeds office. See Gibbs, 831 N.W.2d at 701-02. It has
specifically held “that the record owner of mineral interests, as used in § 57-229, may
-26-

be determined not only from the register of deeds but also from the probate records
in the county where the interests are located.” Rice, 854 N.W.2d at 573. The Court
“reasoned that including an owner identified through probate records in the county
where the interests were located was consistent with the dormant mineral statutes’
purpose of clearing title records and also protected the identifiable property rights.”
Id. Although the Court has since stated that the term “record owner” does not include
“an owner whose interests were not recorded in the county where the interests were
located,” id., that statement was made with reference to probate records, which are
maintained at the county level.
Where the register of deeds’ records show that a domestic corporation owns a
severed mineral interest, articles of merger filed with the Secretary of State should be
sufficient to protect that interest, provided that the either the surviving or nonsurviving entity has publicly exercised its ownership rights within 23 years prior to
a surface owner filing suit pursuant to Neb. Rev. Stat. § 57-228. Because an action
brought under § 57-228 “is an equitable case, if any doubt remains as to the meaning
of ‘record owner,’ it should be construed against forfeiture.” Gibbs, 831 N.W.2d at
703 (footnote omitted).
AgriBank, of course, is not a Nebraska corporation. Because it operates under
a federal charter, records of its corporate existence are to be found at the national
level. The charters and charter amendments issued by the Farm Credit Administration,
a federal agency, are public records, see 5 U.S.C. § 552; 12 U.S.C. § 2241, and
AgriBank’s successor-in-interest status is established by the federal statutes which
occasioned the mergers in 1988, 1994, and 2003. Under these circumstances, I believe
the Nebraska Supreme Court would consider AgriBank to be a “record owner” for
purposes of § 57-229. As a record owner, AgriBank was entitled to publicly exercise
its ownership interests in the mineral rights by recording verified claims of interest
with the register of deeds, which it accomplished in 2014, prior to the filing of these
lawsuits.

-27-

AgriBank’s verified claims strictly comply with the requirements of § 57229(3) by describing the land and interests claimed, properly identifying the deeds in
which FLB created the severed interests, providing a name and address, and stating
that AgriBank claims the interests and does not intend to abandon the same. In each
of these filings AgriBank also describes itself as “a federally chartered corporation,
and successor in interest to AgAmerica, FCB, the successor in interest to The Federal
Land Bank of Omaha and the Farm Credit Bank of Omaha.”
The plaintiffs contend AgriBank was required to record with the registers of
deeds an “instrument of record” proving it successor-in-interest status, such as “an
Agreement and Plan of Merger or the Articles of Merger for each of the bank mergers
beginning with the merger between FLB and Farm Credit Bank of Omaha” in order
to retain its mineral interests (Case No. 4:14CV3232, Filing No. 35 at CM/ECF p. 6).
Such a requirement would impose an unnecessary burden on AgriBank and upset the
balance that the Nebraska Legislature sought to achieve between clearing title records
and protecting identifiable property rights. See Rice, 854 N.W.2d at 573. “[T]he
burden imposed by § 57-229 upon the severed mineral owners is not great.” Id. at 574.
Because I find that AgriBank is a “record owner” for purposes of § 57-229, I
do not reach the merits of the affirmative defense of federal preemption. See Wallace
v. ConAgra Foods, Inc., 747 F.3d 1025, 1029 (8th Cir. 2014) (“It is not the habit of
the court to decide questions of a constitutional nature unless absolutely necessary to
a decision of the case.”) (emphasis in original; quoting Burton v. United States, 196
U.S. 283, 295 (1905)); Dobrovolny v. Nebraska, 100 F. Supp. 2d 1012, 1035 (D. Neb.
2000) (“Federal courts should avoid reaching constitutional claims if the case may be
disposed of on alternate grounds.”).
Finally, because these cases were removed to this court on the basis of federal
officer jurisdiction, and because a supplemental jurisdiction claim is asserted against
Mary Rasmussen in Case No. 4:14CV3233, I will enter judgment in that case pursuant
to Federal Rule of Civil Procedure 54(b) in favor of FLB, FCB, and AgriBank, and
-28-

will remand the case to the District Court of Sioux County, Nebraska, for further
proceedings involving the property as to which Ms. Rasmussen is alleged to be the
record owner of mineral interests. For the reasons discussed below, I specifically find
that the judgment will be final and that there is no just reason to delay its entry.
Under 28 U.S.C. § 1367(c)(3), the Court may decline to exercise supplemental
jurisdiction where the Court has dismissed all claims over which it has original
jurisdiction. See Mountain Home Flight Serv., Inc. v. Baxter Cnty., Ark., 758 F.3d
1038, 1045 (8th Cir.2014). While this determination is a matter of discretion for the
court, “in the usual case in which all federal-law claims are eliminated before trial, the
balance of factors to be considered under the pendent [or supplemental] jurisdiction
doctrine—judicial economy, convenience, fairness, and comity—will point toward
declining to exercise jurisdiction over the remaining state-law claims.” CarnegieMellon Univ. v. Cohill, 484 U.S. 343, 350 n. 7 (1988). The Court has weighed each
of these factors and finds it appropriate to remand the case to state court. The issue of
whether mineral interests owned by Mary Rasmussen have been abandoned under
Nebraska law is best determined by a Nebraska court, in the county where the real
property is located. The other defendants claim no interest in that property. While the
claim could be dismissed without prejudice to its refiling in state court, it is possible
the plaintiffs would be adversely affected by the fact that the filing date of the action
is vitally important to the issue of abandonment under Neb. Rev. Stat. § 57-229.
Federal Rule of Civil Procedure 54(b) provides that “when multiple parties are
involved, the court may direct entry of a final judgment as to one or more, but fewer
than all, claims or parties only if the court expressly determines that there is no just
reason for delay.” The rule requires a two-step analysis. “The court ‘must first
determine that it is dealing with a final judgment ... in the sense that it is an ultimate
disposition of an individual claim.’” Downing v. Riceland Foods, Inc., No. 14-3758,
2016 WL 158294, at *3 (8th Cir. Jan. 14, 2016) (quoting Williams v. Cnty. of Dakota,
687 F.3d 1064, 1067 (8th Cir. 2012)). A judgment dismissing the plaintiffs’ claims
against FLB, FCB, and AgriBank clearly is final. “Second, the district court must
-29-

determine whether a just reason for delay exists.” Id. “In making such determination,
‘the district court must consider both the equities of the situation and judicial
administrative interests, particularly the interest in preventing piecemeal appeals.’”
Id. (quoting Williams, 687 F.3d at 1067).20 As discussed above, I have concluded that
the claim alleged against Mary Rasmussen should be remanded to state court. To
accomplish this result, it is necessary to enter a final judgment on the claims that
involve only the other defendants. If the court were to exercise supplemental
jurisdiction in Case No. 4:14CV3233 after dismissing the other two cases, this could
lead to piecemeal appeals. I therefore find no just reason for delay in entering
judgment.
D. Defendants’ Motions Regarding Their Counterclaims
In each case, the defendants have counterclaimed for a declaratory judgment
“that AgriBank is the record owner of the Mineral Interests, as that term is used in
Neb. Rev. Stat. § 57-229, based upon Nebraska law and/or controlling federal law,”
and have requested the court to “[q]uiet title in the Mineral Interests in favor of
AgriBank.” (Case No. 4:14CV3232, Filing No. 38). The court granted the defendants
leave to file the counterclaims after the plaintiffs moved for voluntary dismissal of
their actions, without prejudice.

20

Factors to consider include “(1) the relationship between the adjudicated and
unadjudicated claims;(2) the possibility that the need for review might or might not
be mooted by future developments in the district court; (3) the possibility that the
reviewing court might be obliged to consider the same issue a second time; (4) the
presence or absence of a claim or counterclaim which could result in setoff against the
judgment sought to be made final; (5) miscellaneous factors such as delay, economic
and solvency considerations, shortening the time of trial, frivolity of competing
claims, expense, and the like.” Downing, 2016 WL 158294, at *4 (quoting Hayden v.
McDonald, 719 F.2d 266, 269 (8th Cir.1983) (per curiam)).
-30-

The defendants indicated the counterclaims were precautionary filings that had
not been included in the defendants’ answers “because the relief AgriBank seeks – a
declaration of rights and ownership of the Mineral Interests – is subsumed within
Plaintiffs’ complaints for declaratory judgment” (Case No. 4:14CV3232, Filing No.
34 at CM/ECF p. 3). They urged the court either to “decline to allow Plaintiffs
to dismiss their claims until after the Court rules upon AgriBank’s motion for
judgment on the pleadings [regarding the plaintiffs’ claims], or allow the Lawsuits to
proceed on AgriBank’s counterclaim[s]” (id.).
Because the court has now determined that the defendants’ Rule 12(c) motions
should be granted with respect to the plaintiffs’ complaints, the counterclaims seeking
inverse declaratory relief have become moot. Consequently, the counterclaims will
be dismissed without prejudice and the defendants’ Rule 12(c) motions filed with
respect to the counterclaims will be denied without prejudice.
V. Conclusion
AgriBank is the record owner of an undivided one-half interest in mineral rights
involving real property as to which the plaintiffs claim to be the surface owners. The
verified claims recorded by AgriBank strictly comply with the requirements of Neb.
Rev. Stat. § 57-229, and defeat the plaintiffs’ claims that the severed mineral interests
have been abandoned. Accordingly,
IT IS ORDERED:
1.

In Case No. 4:14CV3232,
a.

Defendants’ first motion for judgment on the pleadings (Filing
No. 11) is granted, and Plaintiffs’ action is dismissed with
prejudice.

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b.

c.

Defendants’ counterclaim is dismissed without prejudice, as moot.

d.

Defendants’ second motion for judgment on the pleadings (Filing
No. 45) is denied without prejudice, as moot.

e.
2.

Plaintiffs’ motion for judgment on the pleadings (Filing No. 36)
is denied.

Final judgment shall be entered by separate document.

In Case No. 4:14CV3233,
a.

Defendants’ first motion for judgment on the pleadings (Filing
No. 8) is granted, and all claims alleged by Plaintiffs against
Defendants Federal Land Bank of Omaha, Farm Credit Bank of
Omaha, and AgriBank, FCB, are dismissed with prejudice.

b.

Plaintiffs’ motion for judgment on the pleadings (Filing No. 40)
is denied.

c.

Defendants’ counterclaim is dismissed without prejudice, as moot.

d.

Defendants’ second motion for judgment on the pleadings (Filing
No. 49) is denied without prejudice, as moot.

e.

Pursuant to Federal Rule of Civil Procedure 54(b), with the court
finding no just reason for delay, final judgment shall be entered by
separate document regarding all claims alleged against the banks.

f.

Pursuant to 28 U.S.C. § 1367(c)(3), this case is remanded to the
District Court of Dawes County, Nebraska (Case No. CI 14-103).
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g.

3.

The clerk of the court is directed to mail certified copies of the
judgment and this memorandum and order to the Clerk of the
District Court of Dawes County, Nebraska, and may take any
other action necessary to effectuate the remand.

In Case No. 8:15CV26,
a.

Plaintiff’s motion for judgment on the pleadings (Filing No. 26)
is denied.

b.

Defendants’ first motion for judgment on the pleadings (Filing
No. 29) is granted, and Plaintiff’s action is dismissed with
prejudice.

c.

Defendants’ counterclaim is dismissed without prejudice, as moot.

d.

Defendants’ second motion for judgment on the pleadings (Filing
No. 38) is denied without prejudice, as moot.

e.

Final judgment shall be entered by separate document.

DATED this 25th day of January, 2016.
BY THE COURT:
Richard G. Kopf
Senior United States District Judge
*This opinion may contain hyperlinks to other documents or Web sites. The U.S. District Court for the District
of Nebraska does not endorse, recommend, approve, or guarantee any third parties or the services or products they
provide on their Web sites. Likewise, the court has no agreements with any of these third parties or their Web sites. The
court accepts no responsibility for the availability or functionality of any hyperlink. Thus, the fact that a hyperlink ceases
to work or directs the user to some other site does not affect the opinion of the court.

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