Supervisors Deny Rise Gold’s Vested Mining Rights Petition

On December 14, 2023, after two hours of discussion, the Nevada County Board of Supervisors unanimously opined that Rise Gold does not have a vested right in the Idaho-Maryland Mine. In 2017, Rise Gold purchased the mine from the heirs of one of our more familiar local residents. Following one entire day of public comment as well as the two hours of discussion prior to the vote, each supervisor voted to deny Rise Gold’s Vested Rights Petition filed with the County on September 2, 2023, setting up a likely court battle. Prior to voting against the petition, Supervisor Ed Scofield from Alta Sierra conceded that, while Rise Gold has a right to mine the property, Rise Gold must first obtain a use permit from the County for the gold mine. Regarding these complex local mining issues and prior to voting against Rise Gold’s petition, Supervisor Sue Hoek from Penn Valley stated, “I feel like that this is above my pay grade to be totally honest.”

Does Rise Gold have a Vested Right to Mine the Idaho-Maryland Mine

At primary issue in Rise Gold’s petition is whether Rise Gold has a “vested right” to mine the old Idaho-Maryland Mine property for gold and whether such “vested right” was intentionally abandoned at any time after 1954 when Nevada County first introduced the necessity of having a permit to mine in the County. A “vested right” is a right to something which cannot be taken away after the right is attained and maintained. So, it follows that if the owner of the mine had a right to gold mine without a permit prior to the passing of the County ordinance, then the right to mine gold is “vested,” and the County cannot require a permit.

Hansen Brothers Enterprises and the California Supreme Court (Yes, Our Local Hansen Brothers!)

The seminal legal case on these complex matters related to vested mining rights is a case which incidentally originated in Nevada County and went all the way to the California Supreme Court. In the mid-1990s, and after Nevada County denied Hansen Brothers’ plan to mine its own property in the Bear River Valley, Hansen Brothers sued Nevada County in superior court for the denial.

Former Nevada County Superior Court judge, Reginald Littrell, denied Hansen Brothers’ petition finding that Hansen Brothers, while continually quarrying their property, had discontinued the mining of its property and thus had voluntarily abandoned its “vested right” to mine. After the appellate court affirmed the trial court decision and in 1996, the California Supreme Court reversed Littrell’s initial decision and ordered him to continue the proceedings in the trial court “consistent with this opinion.” 

Property Owner Must Act in a Manner which Indicates that They Have Abandoned their Right

In its opinion, the California Supreme Court held that the discontinuation of mining a property was not the same as voluntarily abandoning its vested right to mine. For a vested right to mine to be abandoned by the property owner, the Court concluded that the key factors to consider in making such a determination are whether the owner intended to voluntarily abandon the vested right or whether the owner acted in a way which implied that they voluntarily abandoned their right. The Court added that the duration of nonuse as a mine can be a factor to consider in making the determination of whether the right is vested. This standard, as shaped by the California Supreme Court, is the very same standard which the supervisors must use in determining whether Rise Gold still has a vested right to mine gold from the old Idaho-Maryland Mine.

History of the Idaho-Maryland Mine

In its vested rights petition, Rise Gold submitted to the County a detailed history of the Idaho-Maryland Mine referencing 429 exhibits which consist of declarations, historic maps and documents, as well as old county planning reports. Much of the following history comes from these historical documents attached to Rise Gold’s petition before the Board of Supervisors and from the County’s staff report which contains a history of the Idaho-Maryland Mine as well.

In 1867, the former editor of the local newspaper wrote that in 1849 a few individuals found their way to a “verdant valley, coursed by a beautiful stream then unrntiled [sic] by the labor of the prospector.” This “verdant valley” later became known as Grass Valley, and around the same time investors began consolidating small mining claims on Gold Hill in Grass Valley which eventually became the Empire Mine, the Idaho-Maryland Mine was established off modern-day Brunswick Road just past Bennett Street heading towards Colfax. From 1851 until 1956, Idaho-Maryland Mine continually operated as a gold mine. In 1954, and as stated previously, Nevada County enacted its first ordinance necessitating the need to have a permit to mine in the county. Because the Idaho-Maryland Mine was operating as a gold mine at this time in 1954, its right to mine gold from the property became “vested,” and thus Nevada County could not now require it to obtain a permit to mine pursuant to the 1954 ordinance unless the right was voluntarily abandoned. That said, and similar to the Empire Mine which closed in 1957 due to economic conditions, all gold mining operations of the Idaho-Maryland Mine also ceased in the same year, and the equipment was sold.

In the mid-1970’s, the surface of the Empire Mine was sold to the State of California which turned the surface land into a state park in Grass Valley, California. Newmont Mining still owns the mining rights to the Empire Mine, as well as to the North Star Mine a few miles away, and has been, over the past decade, attempting to work with the state and local officials to re-open the gold mines.

Idaho-Maryland Mine Purchased by the Ghidottis

Due to economic conditions and increased operating costs, the Idaho-Maryland Mine eventually filed bankruptcy. At the bankruptcy auction in 1962, Bill and Marian Ghidotti purchased the mine. Local residents may recognize the Ghidotti name, as their local charitable foundation has contributed over $18 million dollars to the education of local children and other charitable activities since 1980 and the Ghidotti Early College High School is named after them.

In 1979 and of particular note, Marian Ghidotti applied to Nevada County for a permit to remove around 500,000 tons of rock and mill sand from the old gold mining operation of the Idaho-Maryland Mine with the intent to crush and sell the gravel and return the land to its original contours. In her application, Ghidotti acknowledges that gravel from the old gold mining operation had been continually removed from the property since the old Idaho-Maryland Mine was running, so while Ghidotti had a vested right to operate the mine in such a manner, she was requesting the expansion of such vested right by adding a “crusher and screening plant.” The County approved the use in 1980 as requested by Ghidotti. Rise Gold contends that this acknowledgment by Nevada County in 1980 indicates that the right to mine gold from the property was, at a minimum, vested until 1980. Nevada County denies this contention.

Marian Ghidotti Passes Away 

After Marian’s death in 1980, her heirs inherited the Idaho-Maryland Mine property and continued removing the 500,000 tons of rock and sand. Since then, the property was used in the manner requested by Ghidotti in 1979 and was also used as a sawmill for nearly three decades until 1994. Six years after Marian’s death, her heirs began attempts to reopen the old Idaho-Maryland Mine as a gold mine. In the early 2000s and without obtaining title to the property, Emgold Mining Corporation went through efforts to reopen the gold mining operation. Eventually, and in 2017, Rise Gold purchased the mine from Ghidotti’s heirs with the intent to renew gold mining operations. 

Rise Gold Argues that its Right to Operate a Gold Mine is Vested and that Nevada County Cannot take that Right Away

Rise Gold alleges that, as concluded by the California Supreme Court in Hansen Brothers Enterprises, Inc. v. Board of Supervisors (1996) 12 Cal.4th 540, and while the property was used in a different manner while the economics of gold mining did not pencil out, not a single owner of the old Idaho-Maryland Mine ever intended to voluntarily abandon the vested right to operate the property as a gold mine. Rise Gold concludes that, because the intent to reopen the gold mine always existed and no owner acted in a manner which could create the implication of voluntary abandonment, the County’s mining ordinance does not apply to its vested right to mine gold. The County counters that the cessation of gold mining operations at the property and the conduct of other operations over the past 65 years is clear evidence that the vested right to gold mine the property was voluntarily abandoned. In addition, the County points to the fact that Rise Gold recently applied for a permit to mine gold from the property thus, acknowledging the need for a permit, the applicability of the County’s mining ordinance, and the voluntary abandonment of the vested right to mine the property for gold. 

At the end of the day and if this matter heads to the Nevada County Superior Court, the ghost of Hansen Brothers returns to Nevada County and brings clarity to a cloudy landscape. If the County is to prevail in court and consistent with the California Supreme Court’s ruling in Hansen Brothers, the County will have to provide substantial evidence to the Nevada County Superior Court that one of the prior owners of the old Idaho-Maryland Mine, at one time, acted in a way demonstrating their intent to voluntarily and permanently abandon their vested, and extraordinarily valuable, right to mine gold from one of the richest areas for gold deposits in the State of California.

Idaho-Maryland Mine Lore

Based on the foregoing and following the standard established by the Hansen Brothers’ lawsuit against Nevada County in 1996, it is clear that another honorable judge of the Nevada County Superior Court may make history and have his or her ruling in the superior court appealed to the California Supreme Court taking a seat next to the Honorable Reginald Littrell and cementing himself or herself into legal history and the rich local history of the old Idaho-Maryland Mine.