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Riedel v. Anderson6/4/2003
le when they granted to the Board of Land Commissioners the "direction, control, leasing and disposal" of the state lands. Wyo. Const., Art. 18, § 3. We held in Ross v. Trustees of Univ. of Wyo., 30 Wyo. 433, 443, 222 P. 3, 7 (1924), that the granting of a right-of-way across state lands is not a "disposal" as contemplated by the Constitution. We conclude likewise that a lease of state lands as authorized by the Constitution is not a disposal of those lands and need not be accomplished by public auction.
Riedel contends that the preferential right to renew violates the constitutional prohibition on "granting any privileges to persons who may have settled upon any of the school lands..., by which the amount to be derived by the sale or other disposition of such lands, shall be diminished directly or indirectly." Wyo. Const., Art. 18, § 5. This argument lacks cogency: the lessees of today are not the original settlers contemplated by the Constitution and, as noted above, the leasing of the lands is not a "sale or other disposition" of the school lands.
Riedel's final constitutional argument is the one addressed by most of his evidence at trial. Assuming the existence of a trust, and assuming the trust to be governed by common law standards rather than the legislature, he contends that the right to renew depresses the value of agricultural leases and therefore violates the trustees duty to maximize revenue from the trust lands. However, we have concluded that the land trust in Wyoming is created by the legislature and hence the management of that trust and, as specifically authorized by the Constitution, the leasing of the trust lands, are governed by the statutes and not by common law trust principles. Huckfeldt v. State Bd. of Sch. Land Comm'rs, 20 Wyo. 162, 122 P. 94 (Wyo. 1912). The legislature will not be presumed to have created the trust and violated it at the same time.
The trial court granted judgment as a matter of law at the close of plaintiff's case. A review of the record shows that judgment was properly granted. Riedel sought to prove through expert testimony that incumbent lease holders in Wyoming almost always prevail when there is a competing lease application, that those leases have a positive "permit value" when agricultural properties are marketed, and that other states realize more for their leases because they have a variable rather than a single statewide minimum lease rate. Much of his evidence was of a historical nature, and addressed past management practices of the Board without tie-in to the current statute or the lease at issue. To conclude from that evidence that the state is not realizing sufficient income from its trust lands, rising to the level of a breach of fiduciary duty, would be sheer speculation and falls far short of Riedel's considerable burden to prove the statute's unconstitutionality. While there may have been problems with earlier versions of the preferential right to renew statute, the current version requires that the renewing lease holder match any competing bid and therefore approximates market value. Riedel's evidence that many private agricultural sales include a premium for the seller's lease permits, in addition to being substantially impeached, does not necessarily indicate that the lease was undervalued when granted by the Board. It is just as likely that the lease premium recognizes the seller's efforts in obtaining the lease or improvements made to the leasehold.
CONCLUSION
The lands granted to the State of Wyoming by Congress upon the State's admission were not conveyed subject to a federal trust, nor did the people of Wyoming constitutionally impose a trust on those lands. However, the Legisla
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