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DIVISION OF RECLAMATION, MINING AND SAFETY <br />Department of Natural Resources <br />1313 Sherman St., Room 215 <br />Denver, Colorado 80203 <br />Phone: (303) 866 -3567 <br />FAX: (303) 832 -8106 <br />July 19, 2012 <br />Mr. Jim Guire <br />P.O. Box 550 <br />Nucla, CO 81424 <br />RE: Right of Entry Dispute — New Horizon Mine — Permit No. C- 1981 -008 <br />Mr. Guire: <br />Office of <br />Mined Land Reclamation <br />STATE of COLOFADO <br />COLORADO <br />D I V I S I O N O F <br />RECLAMATION <br />MINING <br />—&— <br />SAFETY <br />John W. Hickenlooper <br />Govemor <br />Mike King <br />Executive Director <br />Loretta E. Pineda <br />Director <br />The Division of Reclamation Mining and Safety (Division) and our attorney have reviewed all <br />documents and related information submitted by yourself and Chris Kamper, on behalf of Western Fuels - <br />Colorado, related to an ongoing right of entry dispute stemming from a 1956 mining lease and related <br />addenda, amendments, releases, assumptions and other relevant documents. The Division and/or Mined <br />Land Reclamation Board (Board) do not have the legal authority or jurisdiction to adjudicate private <br />property right disputes. Such adjudication is a power of the court. Therefore, the document review was <br />conducted with this express jurisdictional limit in mind. <br />Specifically, section 34- 33- 110(2)(j) of the Act states: "...nothing in this article shall be <br />construed as vesting the Board or Office the jurisdiction to adjudicate private property disputes." See <br />also, section 34- 33- 114(2)(F)(II). In addition, rule 2.03.6(3), which implements the Act, states: "Nothing <br />in 2.03 shall be construed as vesting in the Division or Board the jurisdiction to adjudicate property right <br />disputes. <br />After thorough review of the relevant documents and various correspondence received from the <br />parties, it is apparent that a dispute exists related to a legal right of entry. The legal validity of that <br />dispute, however, is not as apparent and is a matter best resolved by a court. Based on the statutory and <br />regulatory language above, and the advice of our attorney, the Division cannot issue an administrative <br />determination regarding this dispute since such an action could be construed as an adjudication of a <br />property right dispute. Such an agency determination is not permitted by the Act. Therefore, the Division <br />is legally precluded from issuing a final agency determination regarding the right of entry issue or the <br />legal validity of your claims regarding the mining lease. <br />This specific right of entry/mining lease issue is currently being litigated in the District Court in <br />Montrose County. Although the Division is interested in the outcome of the dispute, as a state agency it <br />cannot become involved in the civil suit. Therefore, it appears that this property right dispute will be <br />adjudicated in the proper venue. Should the court issue an order regarding the right of entry and mining <br />lease, the Division will take regulatory actions to bring the permit into compliance with the court's order, <br />if such actions are necessary. <br />Office of <br />Denver • Grand Junction • Durango Active and Inactive Mines <br />