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'r` --~ ,"'~ Mined Land Declamation Division August 26, 1987 Page 2 Coal to conduct activities related to site clean up and abatement of existing enforcement actions on the property that were incur- zed 6y the previous mining operator after the site was abandoned. On March 31, 1987, the office of 6uzface Mining of the Department of Interior conducted an inspection which revealed mining activity without the scope of the letter o! understanding. A cessation order was then issued (87-2-244-1). The fact of violation with respect to this caseation order.waa admitted at the hearing requested by La Plata Coal Corporation on July 28, 1987 before an administrative law judge. . Plaintiffs funded the operation of the partnership to the point of having expanded in excess of $400,000.00 in what was under- stood to be activity preliminary to the acquisition of a mining permit for the subject property, In play of 1987, a.partnership meeting was conducted by reason of the need for additional funds advocated by La Plata Coal Corporation. Plaintiffs left this meeting with the understanding that each party would be contributing an additional SSO,U00.00. On June 4, 1987, it became clear that La Plata Coal Gorporation and Joe Carpio did not share this understanding as they unilaterally withdrew from the partnership, thereby causing a dissolution of same and further caused to be published in the Aurango Herald in the City of Durango, County of La Plata, State of Colorado, a public notice of their disassociation with the plaintiffs. The public notice is attached hereto as Exhibit A and although it references a date of April 4, 1987, it was intended to refer to June 4, 1987. Also on June 4, 1987, Joe Carpio .and La Plata Coal Corporation Very clearly communicated their intent to the plaintiffs by letter, a copy of which is attached hereto ae Exhibit B, which stated in pertinent part as follows: "AS president of La Plata Coai Corporation, I ;Joe Carpio) herewith advise you that La Plata Coal Corpora- tion is formally withdrawing its membership from the joint venture informally known as The Coal Corporation, a coal mine venture in La Plata County, Colorado. . Therefore, La Plata coal is withdrawing its membership and the venture is dissolved." Negotiations followed wherein the parties attempted to arrange for a settlement by which dissolution could be completed. The plaintiffs ware continually frustrated in negotiations by the absence of any follow through by Carpio with respect to his representations. ultimately, in the latter part of June, 1907, the plaintiffs became aware of the Ssauance of a cessation order by MLRA which occurred on June 25, 1987. On July 1, 1987, the