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The importance of due diligence when determining land status

On Behalf of | Mar 27, 2020 | Business Litigation

Nevada is among the most prolific states in the U.S. when it comes to mineral rights. There are more than 180,000 active mining claims within its borders, accounting for nearly half of all claims on file with the Bureau of Land Management.

Entrepreneurs continue to look to Nevada’s unencumbered public lands for further lode mining opportunities. But the nature of the claiming process can easily lead to confusion and disputes.

Due diligence before staking a lode claim

In order to stake a lode claim, claimants must follow a very specific process. This includes finding a valuable mineral in-place, staking a claim, posting a discovery monument and erecting claims posts. Of course, a long list of administrative steps follows.

Prior to all of this, however, it’s vital to determine the land’s status. This means researching all available records to ensure the land is not only open to location but has not already been claimed. The best way to do this is through a combination of records research and in-person inspection.

After a locator files a notice of inspection, they have 60 days to put up the required monumentation, and 90 days to submit the necessary paperwork. This means there is a period of time where there may be a valid claim on a segment of land, but it is not properly reflected through records or physical markers.

Competing claims

New claims with boundaries that overlap established claims can result in disputes. In some cases, portions of the junior claim that overlap with the senior claim may be deemed invalid. Similarly, a discovery in the overlapping region may be considered not valid for the newer claimant.

However, those with established claims must follow the rules as well. While a locator does have possessory rights, there are some criteria they must meet, including “a diligent effort” to make a discovery.

Mineral rights disagreements can quickly become complex, requiring litigation to resolve. When so much is at stake, this type of defense may be the preferred path forward.

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