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Norken Corp. v. M. McGahan et al (11/15/91), 823 P 2d 622
NOTICE: This opinion is subject to formal correction
before publication in the Pacific Reporter. Readers are
requested to bring typographical or other formal errors to
the attention of the Clerk of the Appellate Courts, 303 K
Street, Anchorage, Alaska 99501, in order that corrections
may be made prior to permanent publication.
THE SUPREME COURT OF THE STATE OF ALASKA
NORKEN CORPORATION, an Alaska )
Appellant/ ) File No. S-3052/S-3053
v. ) 3KN 87 474 Civil
MAZIE M. McGAHAN d/b/a McGAHAN ) O P I N I O N
ENTERPRISES and MERRILL McGAHAN)
d/b/a MERRILL ENTERPRISES, )
Cross-Appellants.) [No. 3771 - November 15,
Appeals from the Superior Court of the State
of Alaska, Third Judicial District, Kenai,
Charles Cranston, Judge.
Appearances: David P. Gorman, Wade &
DeYoung, Anchorage, for Appellant/Cross-
Appellee. Peter F. Mysing, Kenai, for
Before: Rabinowitz, Chief Justice, Burke,
Matthews, Compton and Moore, Justices.
MATTHEWS, Justice, with whom RABINOWITZ,
Chief Justice, joins, concurring.
This dispute is between Norken Corporation, the current
owner of three parcels of land in North Kenai Borough, and
Mazie M. McGahan, the original grantor of those parcels.
Although both parties agree that McGahan owns the gravel
deposits on the parcels by virtue of deed reservations, they
vigorously dispute the scope of that ownership. After
protracted legal wrangling and a lengthy bench trial, the
superior court held that the intent of the deed reservations
was that McGahan retain mining rights to a portion of one
parcel, but only royalty rights to the gravel underlying the
rest of that parcel and the other two properties. Norken
appealed; McGahan cross-appealed. We affirm in part and
reverse in part.
Mazie M. McGahan moved to Alaska from Michigan in 1952 and
homesteaded 160 acres of land in the North Kenai area. In
1956 he received a patent to the land from the United States.
One characteristic of the patented land, apparently important
to McGahan in choosing where to settle, was the presence of
extensive gravel deposits. Another important characteristic
of McGahan's homestead was its bisection by the North Kenai
In the early sixties, McGahan subdivided eighty acres of his
homestead into a residential area called Aurora Heights. As
he sold off the Aurora Heights properties, he routinely
reserved the gravel rights. At trial, he testified that his
intention in so doing was to prevent any future grantee from
ruining the residential character of the neighborhood by
In contrast to his plans for Aurora Heights, McGahan removed
small quantities of gravel from the property involved in this
lawsuit as early as 1954, although the superior court found
that this operation was embryonic as of 1966. In that year
Stan Best, a principal in Peninsula Ready Mix, negotiated with
McGahan for Peninsula to extract gravel it needed to fulfill a
sizeable concrete supply contract. In 1967 Peninsula bought
Tract 1 from McGahan for a purchase price of $10,000. A
portion of Tract 1--an irregularly shaped, three acre parcel--
encompassed at least part of the pit from which Peninsula was
already extracting gravel. On the remaining portion, which
included frontage on North Kenai Road, Peninsula erected
buildings and established a storage area to support its
concrete production operations.
The sale contract and the warranty deed to Tract 1 included
essentially the same reservation of rights:
The Sellers expressly reserve to
themselves, their heirs, executors,
administrators and assigns all oil, gas,
coal, gravel and non-fissionable minerals in,
on or under the surface of said land.
Peninsula continued to pay McGahan for gravel it extracted from
By June 1973, Kenneth Mearkle, d/b/a Northern Steel, was
using an adjoining lot, Tract A, as the location for a gravel
screening plant and a small machine parts store. At that
time, Northern Steel bought Tract A (a 1.1 acre parcel with
more road frontage than Tract 1) from McGahan for $12,000.
The warranty deed for Tract A contained a reservation similar
to the Tract 1 deed:
Grantors expressly reserve to
themselves, their heirs, executors,
administrators and assigns all oil, gas, coal
and non-fissionable minerals in, on or under
the surface of said land. Grantors also
reserve all gravel rights.
McGahan testified at trial that he and Mearkle had an oral agree
ment that a specified portion of the property would be free
from McGahan's right to mine gravel.
Peninsula apparently needed more space for its operations.
In October 1973, with McGahan acting as intermediary,
Peninsula bought Tract A from Northern Steel for $15,000. In
January 1975 Peninsula bought another acre, Tract C, from
McGahan for $4,000. The warranty deed for Tract C contained a
reservation clause identical to that in the deed for Tract A.
According to the superior court, by 1980 or 1981 the gravel
pit, which covered the rear of Tract 1 as well as land still
owned by McGahan, had been mined to a depth of thirty or
thirty-five feet below the grade level of North Kenai Road.
Although some gravel may have been removed from the rest of
the subject property, the court found that "[g]enerally, the
front portions of Tract 1 and Tracts A and C were maintained
at the grade level of the North Kenai Road."
Peninsula sold the three parcels to David Simonson in 1980.
Although the record is unclear as to whether Simonson
extracted any gravel between 1980 and 1982, it is clear that
they did not extract gravel after 1982. Rather, they estab
lished a plant to manufacture ready-mix concrete, to which
they brought gravel extracted from a pit several miles away.
After shutting down the ready-mix operation, Simonson built a
building on the property for use as a shop to paint their
heavy equipment. Throughout this period, McGahan and his son
extracted gravel from the pit and authorized periodic
extractions by third parties. In order to gain access to the
pit, one had to cross the level portion of Tract 1 and with
get the permission of Simonson agent.
Simonson sold the parcels to Ron Johnson in March 1987 for
about $125,000. Johnson eventually conveyed the property to
Norken Corporation, formed by him and others to develop the
property. As Norken pursued plans to build a shopping mall on
the land, McGahan initiated legal action to protect his access
to the gravel and define his rights under the reservation
clauses. After several court orders intended to preserve the
status quo, the case finally came to trial in May 1988.
In a Memorandum of Decision and Judgment dated June 22,
1988, the superior court held that
Norken owns Tracts A and C free from any
right of McGahan to mine any gravel on those
tracts. Similarly, Norken owns that portion
of Tract 1 north of a certain described line
free from any right of McGahan to mine any
gravel on Tract 1. . . . Norken's ownership
of the remainder of Tract 1 is subject to
McGahan's right to remove gravel from the
tract with no liability of McGahan for breach
of the covenant of quiet enjoyment or breach
of any obligation to provide for subjacent
This holding allowed McGahan to continue extraction in the area
that had been used for that purpose for the two decades since
Peninsula first started mining on McGahan's property. However,
the court forbade any expansion of the pit to land which had
been maintained level with North Kenai Road. As for McGahan's
right of access to the pit, the court found that an implied
easement existed that ran along the south border of Tract C;1
the court thus denied McGahan's claimed right of access across
the front portion of Tract 1.
The crux of the court's decision concerning interpretation
of the reservations consisted of reconciling them with
warranties of quiet enjoyment that appeared in each deed.2 To
resolve the apparent conflict between the warranties and the
reservations, the court looked to the circumstances
surrounding the grants and to the conduct of the parties.
After considering the oral agreement between Mearkle and
McGahan concerning the front part of Tract A, as well as the
"actual practice on the remainder of Tract A and Tract C and
the front portion of Tract 1,"the court concluded that
McGahan's ownership of the gravel,
though recognized, did not comprehend an
unlimited license to remove gravel below
grade level in any significant amount on
Tracts A and C and the front (north) part of
Tract 1. This result is consistent [with]
use of that property, namely as an area for
the storage of [Peninsula's] equipment and
for the production of concrete. It is also
consistent with the fact that at least one
building on Tract  was of a permanent
nature and that Mearkle used the building on
Tract A for a parts store.
. . . .
The activities of those persons
owning or working on Tracts 1, A and C from
1967 on proclaim their understanding of the
significance of McGahans' [sic] warranty of
The court denied both parties' claims for damages and refused to
award attorney's fees on the ground that neither party had pre
vailed. Norken appealed, and McGahan cross-appealed.
Both parties open their arguments by directing our attention
to various "rules of construction,"the proper use of which
ineluctably leads to a conclusion in favor of the rules'
proponent. This initial reliance on rules of construction is
misplaced. We have long held that the touchstone of deed
interpretation is the intent of the parties. Hendrickson v.
Freericks, 620 P.2d 205, 209 (Alaska 1980); Shilts v. Young,
567 P.2d 769, 773 (Alaska 1977); Rizo v. MacBeth, 398 P.2d
209, 211 (Alaska 1965). The purpose of rules of construction,
by contrast, "is not to ascertain the intent of the parties to
the transaction. Rather, it is to resolve a dispute when it
is otherwise impossible to ascertain the parties' intent." 6A
R. Powell & P. Rohan, Powell on Real Property 899 at 81A-
108 (1991); see also Russell v. Geyser-Marion Gold Mining Co.,
423 P.2d 487, 490 (Utah 1967) ("rule of construction [favoring
grantees] should be subordinate and yield to the paramount
rule that the intent of the parties is to be given effect if
it can be ascertained").
The proper first step in deed construction is to look to the
four corners of the document to see if it unambiguously
presents the parties' intent, without resort to "rules of
construction." E.g., Spurlock v. Santa Fe Pac. R.R., 694 P.2d
299, 304 (Ariz. App. 1984) ("[a]ll jurisdictions agree"),
cert. denied, 472 U.S. 1032 (1985); Knadler v. Adams, 661 P.2d
1052, 1053 (Wyo. 1983). If the words of the deed taken as a
whole are capable of but one reasonable interpretation, a
court need go no further. Whether a deed is ambiguous is a
question of law. Knadler, 661 P.2d at 1053. Thus, in
reviewing the first step of deed interpretation, this court is
not bound by the determination of the lower court. Walsh v.
Emerick, 611 P.2d 28, 30 (Alaska 1980).
If the deed is ambiguous, the next step in determining the
parties' intent is a consideration of the facts and circum
stances surrounding the conveyance. E.g., Wirostek v.
Johnson, 511 P.2d 373, 374-75 (Or. 1973); Russell, 423 P.2d at
490; cf. Rizo, 398 P.2d at 211-12 (to determine whether
instrument is deed or security in absence of writing, look to
"all of the facts and circumstances of the transaction in
which the deed was executed, in connection with the conduct of
the parties after its execution"). Conclusions about the
parties' intent drawn by the trial court after sifting and
weighing such extrinsic evidence are conclusions of fact.
Rizo, 398 P.2d at 212. This court will not disturb those
findings on review unless they are clearly erroneous--that is,
unless a review of the entire record engenders "a firm and
definite conviction . . . that a mistake has been made."
Martens v. Metzgar, 591 P.2d 541, 544 (Alaska 1979); Alaska R.
Civ. P. 52(a).
Only if these two steps do not resolve the controversy
should the court resort to rules of construction: "[I]t is
essential that a court first attempt to determine and
interpret the intention of the parties from the documents and
the surrounding circumstances before applying any of the
canons of construction. The intent of the parties is the
polestar for interpreting a deed . . . ." 6A R. Powell & P.
Rohan, Powell on Real Property 899 at 81A-108 (1991).
The superior court spent little time on the question of
ambiguity. It merely pointed out that in addition to the
gravel reservation, the deeds warranted quiet and peaceable
possession of the premises. Given that quiet possession of
the premises and removal of the gravel are mutually exclusive,
the court proceeded directly to a consideration of the facts
and circumstances in order to determine where the grantees'
right to quiet possession ended and McGahan's right to remove
McGahan argues that "[t]here is absolutely nothing unclear
or ambiguous about the gravel reservation clauses," in that
the clauses specifically reserve his rights to the gravel. He
acknowledges that the reservations do not address access, but
argues that it is "universally recognized"that a reservation
of mineral rights carries with it "so much of the surface of
the estate as is necessary to extract the minerals." He also
points to universal recognition that the mineral estate is
dominant over the surface estate. Concerning the warranty of
quiet enjoyment, McGahan argues that it does not conflict with
the reservation of gravel rights. He points out that this
warranty is generally considered synonymous with the covenant
of warranty, which only guarantees that there is no defect in
the title which the grantor purports to convey.
McGahan is correct that the superior court's reliance on the
warranty of quiet enjoyment is mistaken. That warranty only
guarantees the validity of grantee's title in to the land
deeded away as against claimants with paramount title. 6A R.
Powell & P. Rohan, Powell on Real Property 900 at 81A-144
(1991); see 3 id. at 411, 34-102 (1991).2 ("The function
of covenants of warranty . . . is to give assurances
concerning the estate conveyed rather than to guide the
construction of the conveyance as to the scope of the rights
conveyed."). Thus, reliance on the warranty of quiet
enjoyment begs the relevant question of what was given (and
reserved) in the first place.
The superior court's underlying instinct, however, seems
correct: A reservation that apparently nullifies the grant is
on its face ambiguous. See Farrell v. Sayre, 270 P.2d 190,
192 (Colo. 1954). In this case, the entire property consists
of gravel deposits which can only be extracted by destruction
of the surface. There thus seems to be a conflict between
giving Peninsula, for example, the right "TO HAVE AND TO HOLD
the said premises . . . FOREVER,"and reserving the right in
effect to destroy the premises at will. On the one hand, the
parties could have intended that the surface rights be
uncertain and subject entirely to McGahan's discretion in
removing gravel. On the other hand, the parties could intend
that the reservation merely entitled McGahan to royalties when
and if the deposits are extracted. Theoretically, the parties
could even have intended that extraction occur on some parts
of the property, but not on others. None of these intentions
is clear from the face of the deed, nor does any of them
conflict with the face of the deed.3
In arguing that the deeds are unambiguous as a matter of
law, both parties assume that gravel is a mineral. They base
their arguments concerning access and extraction rights on
doctrines that apply in cases where the "mineral estate" is
severed from the "surface estate." Courts, however, are
virtually unanimous in holding that gravel is not a "mineral"
in the legal sense of that word. E.g., Anchorage Sand &
Gravel Co. v. Schubert, 114 F. Supp. 436, 437-38 (D. Alaska
1953); Moser v. United States Steel Corp., 676 S.W.2d 99, 102
(Tex. 1984) (sand and gravel belong to surface estate as
matter of law, not included in blanket grant of "other
minerals").4 These cases generally deal with ownership of
sand and gravel deposits under a blanket reservation or grant
of minerals. Although ownership is not at issue here, it is
not at issue because of the specification of gravel rights in
the reservation, not because gravel is a mineral. Unless this
court were prepared to rule that gravel is a mineral, there
seems little reason to apply mineral doctrines as a matter of
The question of what is a mineral is a vexatious one,
generating almost as many reasons why gravel is not a mineral
as there are cases that reach that conclusion. See Miller
Land & Mineral Co. v. State Highway Comm'n, 757 P.2d 1001,
1003-04 & n.2 (Wyo. 1988) (noting that courts and commentators
have relied on "[s]urface doctrine, special value, manner of
enjoyment, knowledge of existence, popular meaning, commercial
value, and scientific meaning" in resolving definitional
problem). A concern that permeates the courts' attempts to
deal with gravel rights is that gravel, although commercially
valuable as an extractable resource, is also the essence of
the surface that is conveyed. See, e.g., Farrell, 270 P.2d at
192; State Land Bd. v. State Dep't of Fish & Game, 408 P.2d
707, 708 (Utah 1965). Rather than consider gravel part of the
"mineral estate," the tendency has been to include gravel
rights as part of the "surface estate." Moser, 676 S.W.2d at
102; see Miller Land & Mineral Co., 757 P.2d at 1004. We join
this overwhelming consensus and hold that gravel is not a
mineral. Thus, gravel rights--even when granted or reserved
in the same clause as mineral rights--are not part of the
The nature of gravel as the essence of the soil illustrates
why it would be inappropriate to import mineral doctrines as a
matter of law to the circumstances of this case. As McGahan
points out, the mineral estate is the dominant estate,
carrying with it the right to make such use of the surface as
is reasonably necessary to remove the minerals. E.g., Moser,
676 S.W.2d at 103 (dominance of mineral estate "is an
imperative rule of mineral law"). This right of reasonable
use does not depend on whether the mineral estate arises from
a grant or reservation. 58 C.J.S. Mines and Minerals 159
(1948).5 The purpose of this doctrine is to effect an
"accommodation" between the surface and mineral estates.
Spurlock, 694 P.2d at 309. Courts have noted that the rights
of the mineral estate "are to be exercised with due regard for
the rights of the owner of the servient estate." Getty Oil
Co. v. Jones, 470 S.W.2d 618, 621 (Tex. 1971); see also Hunt
Oil Co. v. Kerbaugh, 283 N.W.2d 131, 135-36 (N.D. 1979);
Flying Diamond Corp. v. Rust, 551 P.2d 509, 511 (Utah 1976).
This accommodation is necessary--for example, in the oil and
gas context--because the mineral owner can only reach its
minerals by literally going through the surface of the land.
Such an accommodation is impossible in a situation such as
this case, where removal of the gravel necessarily means
destruction rather than mere use of the surface (or where
preservation of the surface necessarily means not disturbing
the gravel). In the analogous situation of whether a grant of
minerals includes the right to surface mine for coal--and thus
to destroy the surface--the rule of mineral dominance has
yielded to heroic efforts by courts to determine intent
through reference to surrounding facts and circumstances. See
generally Annotation, Right to Remove Minerals by Surface
Mining, 70 A.L.R.3d 383, 395 (1976) ("[A]s a general
proposition, no particular word, phrase, or clause, standing
alone, can be said to be decisive as to the permissibility of
surface mining . . . ."). Where, as here, the substance
concerned is not a mineral in the legal sense and the deed
contains no indication on its face that the parties intended
the substance to be removed, we find no justification for
concluding as a matter of law that a mere reservation of
rights entails the right to destroy the surface of the land.6
As mentioned at the outset of this discussion, if a deed is
not unambiguous as a matter of law, the court must then look
at surrounding facts and circumstances to determine the
parties' intent. We have suggested that this inquiry can be
broad, looking at "all of the facts and circumstances of the
transaction in which the deed was executed, in connection with
the conduct of the parties after its execution." Rizo, 398
P.2d at 211-12. This factual determination after a bench
trial will be overturned on review only if it is clearly
erroneous. Alaska R. Civ. P. 52(a).
In this case the trial court concluded, based on an oral
agreement as to part of the property and on actual practice as
to other parts, that the parties' intent was that McGahan
should have extraction rights only as to the extant pit at the
rear of Tract 1. Although this decision has the effect of
perpetuating over two decades of practice, both parties claim
on appeal that the court clearly erred in this determination.
A review of the entire record, however, does not engender "a
firm and definite conviction"that the trial judge made a
mistake in arriving at a factual determination that was
somewhat short of what either party would have desired.
Martens, 591 P.2d at 544.
Several aspects of the record support the trial court's
conclusion. Foremost is the basic fact that McGahan and
Peninsula actively developed the pit on one portion of the
property while Peninsula set up a permanent structure on
another part of Tract 1 and Mearkle set up a permanent
structure on Tract A. This activity belies Norken's assertion
that the parties never intended that McGahan should have any
extraction rights whatsoever, while simultaneously casting
doubt on McGahan's assertion that each party intended that the
whole of each parcel should be vulnerable in perpetuity to
Next is McGahan's admission that virtually identical reserva
tions in Tracts 1, A, C and the Aurora Heights subdivision
meant three different things. While claiming that he had the
right to extract every stone from Tract 1 by virtue of the
reservations, he admits that he did not have that right with
respect to at least the front portion of Tract A and that
extraction rights were not the intention of the reservations
in the Aurora Heights deeds. These admissions undermine his
argument before this court that every gravel reservation
clause must intend strip mining of the entire subject
Indeed, the most difficult aspect of the case, from
McGahan's point of view, is explaining exactly what Peninsula
received for over $30,000 (for all three parcels), if it did
not receive at least some protection from an unfettered right
by McGahan to extract gravel. After Norken's attorney
established that Peninsula already had access to McGahan's
gravel and to water to sort it with7 before buying Tract 1,
the following exchange took place at trial during cross-
examination of McGahan:
Q: Okay, so that's what I'm
trying to find out, sir, is what it was
that he [Stanley Best of Peninsula]
acquired by buying Tract 1 from you. On
direct you said that he got a source of
gravel, he got water, he had to pay for
the gravel only as needed.
A: That's right.
Q: And he only had to pay ten
cents a yard for it.
A: That's right.
Q: So what was the difference,
what did he have after he bought. . . .
A: He had a place to set his shop
up, to set his plant up, you know, his
Q: Right, but he would have had
that anyway, would he not?
A: No, he didn't have it anyway
prior to the time he bought the land.
Q: Oh, you would not have let him
set his plant up if he did not buy Tract
A: Oh, I wouldn't say I wouldn't,
but he come and bought the land because
that's what he wanted.
On the other hand, it is not very difficult to explain why
McGahan would retain gravel rights even on a portion for which
he did not have extraction rights: McGahan's right to
royalties would preclude any future surface owner from
competing with his continued extraction from his own property
(and from the pit portion of Tract 1).
The court also heard valuation testimony that was not incon
sistent with the determination that part of the property would
be used for gravel extraction and part would not. McGahan's
expert testified that the fee simple value of Tract 1 was
probably about $7500 or $8000 an acre in 1967. Peninsula paid
just over $3300 an acre for the land it received, or close to
half the estimated fee simple value. Had the entire tract
been free of McGahan's right to extract, the price should have
been close to the full value. By the same token, however, if
the entire parcel had been subject to McGahan's right to
excavate at will, the price should have been closer to zero,
insofar as excavation would destroy the surface.
This particular valuation seems to be a rough estimate based
on the expert's contemporaneous purchase of nearby properties.
During a hearing on a preliminary injunction, the trial court
had heard testimony from Ron Johnson, the Norken promoter,
that a nearby property was sold without a gravel reservation
in 1966 for only $1000 an acre. In a subsequent interlocutory
order, the judge apparently accorded at least some credibility
to that testimony by holding that the consideration for Tract
1 was "in excess of other comparable sales of like property in
1967." Taking these two valuations together, it does not seem
clearly erroneous to think that the price paid was less than
if McGahan had only royalty rights, but more than if McGahan
had complete extraction rights. We therefore conclude that
the superior court's factual findings are not clearly errone
The essence of McGahan's initial complaint, which could only
be reached after a determination of his right to extract
gravel, centered on a claimed right to cross Norken's property
in order to reach the gravel pit. McGahan premised this right
of access on a number of easement theories, only one of which
is before this court in McGahan's cross-appeal: the existence
of an implied easement. "An easement by implication arises
where there is (1) a quasi-easement at the time of contract of
sale or conveyance, (2) which is apparent, (3) reasonably
necessary for the enjoyment of the land retained or the land
conveyed, and (4) continuous in nature." Demoski v. New, 737
P.2d 780, 783-84 (Alaska 1987); see also Freightways Terminal
Co. v. Industrial & Commercial Constr., Inc., 381 P.2d 977,
983-84 (Alaska 1963).
The superior court held that there was no implied easement
as to Tract 1, but that there was as to the so-called Norken
Road, which traverses a strip of Tract C. The court's reason
ing is somewhat opaque:
The route across Tract 1 was not
necessary to McGahan's enjoyment of Tracts A
and C at the time of their severance since he
had access to them from the North Kenai Road
in 1967. At the time of McGahan's
conveyances of Tracts A and C in 1973 and
1975 respectively, the Nurphy Street right-of-
way existed along the east boundary of
McGahan's remaining pit property. While the
use of the access over Tract 1 might be a
more convenient access from the pit to the
North Kenai Road, it is not reasonably
necessary for McGahan's beneficial enjoyment
of the pit, Talbot's, Inc. v. Cessnun
Enterprises, Inc., 566 P.2d 1320 ([Alaska]
1978). The Danna-Nurphy right-of-way
provides a reasonable mode for McGahan's use
of the pit.
This reasoning is opaque in that it does not seem to address the
important question: At the time of the severance of Tract 1,
was a route across Tract 1 reasonably necessary for McGahan's
enjoyment of his reserved rights in the Tract 1 pit?
The court held as a matter of fact that McGahan consistently
used a route across Tract 1 to enter and leave the pit. In
determining whether an implied easement exists, the existence
of reasonable necessity is determined as of the time of
severance, because it is at that time that the implied
easement either does or does not arise. Having once arisen,
the implied easement is not extinguished merely because the
reasonable necessity ceases to exist. Story v. Hefner, 540
P.2d 562, 566 (Okla. 1975); Thompson v. Schuh, 593 P.2d 1138,
1145 (Or. 1979). The durability of the easement comes from
the fact that an implied easement
is based on the theory that whenever one
conveys property he includes or intends to
include in the conveyance whatever is neces
sary for its beneficial use and enjoyment and
to retain whatever is necessary for the use
and enjoyment of the land retained. An ease
ment by implication is a true easement having
permanence of duration and should be distin
guished from a "way of necessity"which lasts
only as long as the necessity continues.
Story, 540 P.2d at 566. We implicitly adopted this view of
implied easements when we first acknowledged their validity:
"Necessity"and "necessary"as we have
used those words in this opinion when
speaking of one of the requirements of an
implied easement resulting from a preexisting
quasi easement must not be confused with what
is known in the law as an easement or way by
necessity. Such a way may arise where an
owner of land conveys to another an inner
portion which is entirely surrounded by lands
owned by the conveyor or by the conveyor and
another. In such a situation a right of
access across the retained land of the
conveyor is normally found, based upon public
policy which is favorable to full utilization
of land and [the] presumption that parties do
not intend to render land unfit for
occupancy. Such a way ceases when the neces
sity therefor ceases.
Freightways Terminal Co., 381 P.2d at 984 n.16 (citations
omitted). Thus, a determination that no reasonable necessity
existed as of 1988, when the superior court handed down its
decision, does not resolve the question of whether an implied
easement arose in 1967, the date of Tract 1's conveyance.
The court's apparent reliance on Talbot's, Inc. v. Cessnun
Enterprises, Inc., 566 P.2d 1320 (Alaska 1977), is only
partially correct. The decision in Talbot's did indeed
distinguish between mere convenience, which will not support
the finding of an easement by implication, and reasonable
necessity, which will support such a finding. Id. at 1323-24.
But there, the deter-mination concerned the alleged creation
of the easement. Id. at 1322-23.8 Talbot's therefore does
not support the superior court's conclusion that the
availability of the Norken Road precludes McGahan's right to
an implied easement across Tract 1.
Given the somewhat confusing discussion of the access issue
in the superior court's decision and the lack of clarity in
the record, we must remand to the superior court for further
determinations of fact. The first determination should be
whether access to the gravel pit across Tract 1 was
"reasonably necessary"in 1967. If so, an implied easement
arose at that time and continues in spite of the current
availability of the Norken Road.9 The court need go no
If the route across Tract 1 was not reasonably necessary in
1967--for example, because adequate access was available
across Tracts A and C--then the court must determine whether
current circumstances require the finding of a "way by
necessity" along the Norken Road. If McGahan can reasonably
gain access to the pit portion of Tract 1 by some other means,
then a finding of a "way by necessity"is not appropriate.10
The superior court's interpretation of the deed reservations
is AFFIRMED. The superior court's finding of an implied
easement on the Norken Road is REVERSED and the case REMANDED
for further proceedings consistent with this opinion.
MATTHEWS, Justice, with whom RABINOWITZ, Chief Justice,
I concur in the result of the majority opinion, and in the
reasoning. However, in proceeding from the conclusion that
the deeds are ambiguous (Maj. Op. at 11), to a discussion of
the extrinsic circumstances in order to determine what the
deeds mean (Maj. Op. at 15 et seq), the opinion digresses to
examine the question whether gravel is a mineral. This
question has not been raised by the parties and its resolution
plays no role in today's decision. Because I believe that the
expression of views on important legal subjects that are not
briefed or argued should be avoided in judicial opinions, I do
not concur in this discussion.
1.This route, called the "Norken Road,"was constructed
by Norken after commencement of the litigation as an attempt
to comply with an interlocutory order of the superior court.
Before construction of the Norken Road, the only access to the
pit was across Tract 1 or Tract A.
2.The warranty deed for Tract C, for example, provides:
And the said Grantors do hereby Warrant
and will FOREVER DEFEND the said Grantees,
their heirs and assigns, against any and all
persons having or claiming any right, title
or interest therein adverse to the said
Grantees in the quiet and peaceable
3.Both sides argue that the other's interpretation would
render the deed "meaningless." Although the different
interpretations would affect the relative values of the
parties' rights, it is not accurate to say that any one
interpretation would make the remaining rights meaningless.
For example, to give someone the ownership of a surface that
over time will be destroyed is not meaningless; the right is
just worth less than ownership of a surface that will not be
destroyed. By the same token, reservation of royalty rights
without access rights is not meaningless, merely less valuable
than reservation of access rights. The value of a particular
right--and whether price paid correlates with value received--
obviously depends on the facts and circumstances of the
4.See also Farrell, 270 P.2d at 192; Roe v. State ex rel.
State Highway Dep't, 710 P.2d 84, 87 (N.M. 1985), cert.
denied, 476 U.S. 1141 (1986); Holland v. Dolese Co., 540 P.2d
549, 550-51 (Okla. 1975); Whittle v. Wolff, 437 P.2d 114, 117
(Or. 1968); State Land Bd. v. State Dep't of Fish & Game, 408
P.2d 707, 709 (Utah 1965) (gravel not a mineral under usual
circumstances); Miller Land & Mineral Co. v. State Highway
Comm'n, 757 P.2d 1001, 1004 (Wyo. 1988); 54 Am. Jur. 2d Mines
and Minerals 8 (1971); 58 C.J.S. Mines and Minerals 2
(1948). But see Adams v. Chilcott, 597 P.2d 1140, 1144 (Mont.
1979) (whether gravel is a mineral is "inherently ambiguous").
Interestingly, McGahan testified at trial that he specified
gravel in the reservations based on his attorney's opinion
that a blanket mineral reservation would not include gravel.
5.Norken's "developing trend of decisions [that] favor
the interests of surface owners over mineral interests" is
less than overwhelming. In fact, as one of Norken's sources
concludes, the cases that tend to balance surface owners'
hardships "do not, however, depart from the underlying theory
of mineral dominance. Case law tempering the doctrine of
mineral dominance is clearly the minority view today . . . ."
Hultin, Recent Developments in Statutory and Judicial
Accommodation Between Surface and Mineral Owners, 28 Rocky
Mtn. Min. L. Inst. 1021, 1066 (1983).
The one decision that Norken cites as evidence of this trend
actually refutes Norken's argument: "There may be only one
manner of use of the surface whereby the minerals can be
produced. The lessee [of mineral rights] has the right to
pursue this use, regardless of surface damage." Hunt Oil Co.
v. Kerbaugh, 283 N.W.2d 131, 136 (N.D. 1979) (quoting Getty
Oil Co. v. Jones, 470 S.W.2d 618, 622 (Tex. 1971)). It seems
clear in this case that there is only one means of removing
the gravel--strip mining the surface.
6.McGahan presents no cases which conclude to the
contrary. His cases concerning "universal recognition"of the
mineral estate's right to use the surface almost all pertain
to oil and gas; of the non-oil and gas cases, one concerns
coal and the other helium. See Aleut Corp. v. Arctic Slope
Regional Corp., 484 F. Supp. 482, 486 (D. Alaska 1980) (oil
and gas lease); Spurlock, 694 P.2d at 303, 311 (helium); Jilek
v. Chicago, Wilmington & Franklin Coal Co., 47 N.E.2d 96, 98
(Ill. 1943) (oil and gas); White v. Bevier Coal Co., 261
S.W.2d 81, 83 (Mo. 1953) (coal); Hunt Oil Co., 283 N.W.2d at
135 (oil); Ball v. Dillard, 602 S.W.2d 521, 522 (Tex. 1980)
(oil and gas lease). In none of those cases was there any
controversy over whether the parties intended that the
resource be extracted.
7.In agreements separate from purchase of the land,
Peninsula paid a portion of the cost of developing a new well
on McGahan's land and eventually paid for the water that it
used in processing gravel. The water arrangements apparently
were entirely pursuant to an unwritten understanding between
McGahan and Peninsula.
8.Technically, Talbot's involved interpretation of a
statutory easement under a portion of the Alaska Land Act, AS
38.05.320(b). Talbot's, 566 P.2d at 1321 & n.1. The language
and purpose of the statutory easement, however, seem virtually
identical to the common law doctrine of implied easements.
9.The superior court seems already to have found the
existence of the other elements of an implied easement in that
the route was in use at the time of the conveyance, its use
was apparent, and its use was continuous.
10.Norken's other contentions concerning the court's
denial of attorney's fees and costs and failure to dismiss the
claims of McGahan's son are without merit.