Disputed Dome Road placer claims will go to highest bidder

Twenty-five placer mining claims in Dawson City will be awarded to whichever of their two owners places the highest bid.

Twenty-five placer mining claims in Dawson City will be awarded to whichever of their two owners places the highest bid.

Justice Ron Veale delivered his decision on the ownership dispute between Darrell Carey and Rod Adams in Yukon Supreme Court on Friday. The 25 claims are located east of the Dome Road in Dawson.

Carey and Adams may each file a sealed bid of at least $500,000 with the court by Feb. 29. The bids will be opened on March 3.

“The court will grant an order of sale to the highest bidder,” Veale explained during his decision.

The dispute between Adams and Carey stems from a disagreement over how to operate the claims, which they purchased jointly in 2012 under the company name 47162 Yukon Inc.

Adams and Carey mined some of the claims in 2013, but the disagreement has prevented them from doing any work since then.

Last week, Adams’ lawyer asked the court to put the 25 claims up for a sealed-bid auction, so that the company could then be dissolved.

But Carey’s representative said that would be unfair, because Adams is “a much wealthier man than (Carey) is” and would almost certainly outbid him.

In his decision, Veale pointed out that “there is no evidence for this allegation.”

He said that sealed bids are “a well-established principle in business law.”

Carey had proposed to split the claims with Adams, in an arrangement that would have left him with 16 claims adjacent to his existing Slinky mine, to the west of the Dome Road. Adams would have retained nine claims in two blocks further east of the road.

But Veale said it would be impossible to know whether that arrangement would leave the two men with equal value, because the claims haven’t all been tested to determine what they’re worth.

In this case, he said, sealed bids are the “fairest option.”

The bids must be at least $500,000, the value of the claims in 2013. The winning bid will be divided equally between Carey and Adams, the claims will go to the winning bidder, and then the company will be dissolved.

Both Adams and Carey have indicated that they want to mine the claims this season, though it’s unclear whether that will be possible.

Adams’ lawyer had originally asked that the bids be filed by Feb. 15, to give the winning bidder enough time to get a water licence for this season.

Veale pushed that date back to Feb. 29.

Adams could not be reached for comment for this story.

For his part, Carey will still be able to operate his Slinky mine. He also owns six claims on the east side of the Dome Road.

“I’m going to keep on mining,” he said outside the courtroom on Friday.

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