ALJDEC decisions subject to certification as final

07F-027-LAN · State Land Department · 2007-09-17

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: August 14, 2007. APPEARANCES: William T. Leavitt represented the beneficial interests of his two minor sons, Luke and Lane Leavitt, in the Leavitt Family Trust. The Arizona State Land Department was represented by Assistant Attorney General John M. Jacobs. ADMINISTRATIVE LAW JUDGE: Brian Brendan Tully _____________________________________________________________________ Based upon the evidence of record, the Administrative Law Judge makes the following Findings of Fact, Conclusions of Law and Recommended Order:

FINDINGS OF FACT

1. The Arizona State Land Department (“Department”) manages State trust lands to maximize trust income for trust beneficiaries, which includes the common schools in Arizona.[1] 2. The Department issued Grazing Lease No. 05-95000 to Jim Nichols and Donna Norbury. 3. On or about March 5, 2007, Mr. Nichols and Ms. Norbury submitted an Application for Assignment of Lease, Permit or Right of Way and Assumption of Interest to the Department. They wanted to assign their grazing leasehold interest to the Leavitt Family Trust for $35,000.00. 4. In February 2005, the Leavitt Family Trust paid Mr. Nichols and Ms. Norbury $35,000.00 for their grazing leasehold. 5. The Leavitt Family Trust is also known as the Leavitt Family Trust dated October 1, 2004.[2] William Leavitt, also known as William H. Leavitt, was the Trustor. 6. Roger D. Leavitt is the named trustee of the Leavitt Family Trust. He and his two twin brothers, Luke Leavitt and Lane Leavitt, each share a 1/3rd beneficial interest in the Leavitt Family Trust. Luke Leavitt and Lane Leavitt are minors who will shortly turn 18 years of age. 7. Roger D. Leavitt, Luke Leavitt and Lane Leavitt are the sons of William T. Leavitt. William T. Leavitt is the nephew of Trustor William H. Leavitt, who is now deceased. 8. Apparently there are several Leavitt Family Trusts.[3] 9. William T. Leavitt has no interest in the Leavitt Family Trust. His participation in this matter is as the father of his minor sons. 10. Any assignment of a grazing leasehold must be approved by the Department before any transfer is effective. 11. After paying Mr. Nichols and Ms. Norbury the sum of $35,000.00, William T. Leavitt and/or the Leavitt Family Trust undertook capital improvements on the subject leasehold and began grazing livestock on the leasehold prior to obtaining the Department’s required approval of the assignment. 12. On or about January 13, 2005, the Arizona Department of Agriculture issued brand description “Bar Over L Diamond” to the Leavitt Family Trust. 13. By letter dated May 9, 2006, the Department’s Range Section Manager, Stephen M. Williams, informed the Leavitt Brothers and William T. Leavitt that their cattle and horses were trespassing on grazing lease 05-308, which was a grazing lease held by Mr. Nichols and Ms. Norbury. Mr. Williams noted that unauthorized “Private Property” signs and locked padlocks had been placed on the grazing leasehold. Mr. Williams directed the Leavitts to remove the livestock, signs, chains and padlocks immediately. A similar letter was sent to Mr. Nichols and Ms. Norbury 14. On May 30, 2007, State Land Commissioner Mark Winkleman issued Denial of Application Order No. 302-2006/2007 denying the assignment application. The Commission determined that the assignment was not in the best interest of the State Trust for the following reasons:

a. Leavitt Family Trust, including William Leavitt as Trustor, and Roger D. Leavitt as Trustee, is not a good risk for the Department to assume the pending assignment of lease 05- 95000. The Leavitt history with the Department is replete with unauthorized use of State Trust land, for which no compensation has been received. Leavitt has ignored multiple requests from the Department for information on livestock numbers and dates of use on the Nichols/Norbury Grazing Lease 05-308. Reports of Leavitt livestock trespass on this lease continue. b. It is not prudent for the Department to cause one lessee’s livestock the opportunity to mingle with another lessee’s livestock within the same range unit. This would be the case if the assignment was approved as it would allow Leavitt livestock to mingle with Nichols/Norbury livestock. The Department would be negligent to allow a potential livestock trespass to be created by approving the assignment.

15. By letter dated June 28, 2007, the Leavitt Family Trust, through counsel, filed a Notice of Appeal and Request for Hearing on Denial of Grazing Assignment Application No. 05-95000. 16. After receiving the Leavitt Family Trust’s request for hearing, the Department forwarded the case to the Office of Administrative Hearings for formal hearing. 17. William T. Leavitt and the Leavitt Family Trust have continually trespassed on the subject grazing lease despite the Department’s numerous demands that they vacate the leasehold. 18. William T. Leavitt and the Leavitt Family Trust have made numerous capital improvements upon the subject grazing lease while trespassing on the leasehold. 19. Pam O’Mara is an inspector for the Arizona Department of Agriculture. Inspector O’Mara credibly testified that she has continuous interactions with William T. Leavitt and Leavitt Family Trust livestock. 20. Inspector O’Mara testified that William T. Leavitt has been consistently uncooperative with her in the performance of her official duties and that she has had to call the Sheriff’s office for assistance before due to Mr. Leavitt’s conduct. 21. Inspector O’Mara credibly testified that William T. Leavitt threatened her during the performance of her official duties. 22. There is credible evidence that Leavitt Family Trust livestock have caused numerous highway accidents, property damage and trespasses resulting in public safety issues. 23. Inspector O’Mara credibly testified that William T. Leavitt claimed to her that he owned the land covered by the subject grazing lease. 24. Inspector O’Mara has been called out to the subject grazing leasehold almost every other day due to problems caused by William T. Leavitt or the Leavitt Family Trust. 25. William T. Leavitt’s testimony that it is standard practice for an assignee of a grazing lease to operate the lease prior to the Department approving the assignment is not credible.

CONCLUSIONS OF LAW

1. The Department has jurisdiction over the subject matter in this appeal. 2. Pursuant to A.A.C. R2-19-119(B), the Leavitt Family Trust had the burden of proof in this appeal. The standard of proof is preponderance of the evidence. 3. The denial of the assignment of the grazing lease in this matter is supported by the evidence of record. William T. Leavitt and the Leavitt Family Trust have continuously trespassed upon the subject grazing lease, made capital improvements to the lands and failed to comply with reasonable directives from the Department and the Arizona Department of Agriculture.

RECOMMENDED ORDER

Leavitt Family Trust’s appeal of the State Land Commissioner’s Order No. 302-2006/2007 denying the assignment of Grazing Lease No. 05-95000 is dismissed.

Done this day, September 17, 2007

______________________________________ Brian Brendan Tully Administrative Law Judge

Original transmitted by mail this ____ day of ____________, 2007, to:

Mark Winkleman, Commissioner State Land Department ATTN: Roz Sedillo 1616 West Adams Phoenix, AZ 85007

By ___________________________

----------------------- [1] The Arizona-New Mexico Enabling Act granted millions of acres of land, including mineral rights, to Arizona in trust for trust beneficiaries when Arizona was admitted into the Union. [2] An unexecuted copy of the Leavitt Family Trust was admitted into evidence. The Department did not challenge the legal entity’s existence when reviewing the assignment request. [3] For example, Exhibit 12 admitted into evidence is a letter from the Arizona Department of Environmental Quality concerning a complaint pertaining to property owned the Leavitt Family Trust, Gary T. Leavitt Trustee.

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Office of Administrative Hearings 1400 West Washington, Suite 101 Phoenix, Arizona 85007 (602) 542-9826