NPCA v. SITLA

2010 UT 13
This opinion is subject to revision before final
publication in the Pacific Reporter.
IN THE SUPREME COURT OF THE STATE OF UTAH
----oo0oo----
National Parks Conservation 	No. 20070835
Association and William Wolverton,
Petitioners,
v.
The Board of Trustees of the
School and Institutional Trust
Lands Administration, State of 	F I L E D
Utah, and Garfield County,
Respondents. 	March 2, 2010
---
Original Proceedings in this Court
Attorneys: 	Wayne G. Petty, William J. Lockhart, Salt Lake City,
for petitioners
Thomas A. Mitchell, John W. Andrews, Salt Lake City,
for respondents the Board of Trustees of the School
and Institutional Trust Lands Administration and
State of Utah
Barry L. Huntington, Panguitch, for respondent
Garfield County
---
DURRANT, Associate Chief Justice:
INTRODUCTION
¶1 	This case concerns an exchange of land held by the
School and Institutional Trust Lands Administration (“SITLA”) for
land owned by Garfield County. 	The SITLA Director formally
approved the exchange, and his decision was challenged by the
National Parks Conservation Association and William Wolverton
(collectively, “NPCA”) before the SITLA Board of Trustees (the
“SITLA Board” or the “Board”). 	The SITLA Board ruled against
NPCA and upheld the Director’s decision. 	NPCA appeals the
Board’s ruling. 	Because we conclude that the exchange was
consistent with SITLA’s obligations as trustee over school trust
lands, we affirm the Board’s decision.

1 Nat’l Parks & Conservation Ass’n v. Bd. of State Lands,
869 P.2d 909, 911 (Utah 1993) [hereinafter NPCA I].
2 Utah Enabling Act, ch. 138, § 6, 28 Stat. 107, 109 (1894).
3 NPCA I, 869 P.2d at 918.
4 Utah Const. art. XX, § 2.
5 Utah Code Ann. § 53C-1-102 (2009).
6 NPCA I, 869 P.2d at 911-12.
No. 20070835 	2
BACKGROUND
¶2 	This case has its genesis in a land exchange, first
proposed in 1987, between the State of Utah, then acting through
SITLA’s predecessor, the Division of State Lands and Forestry
(the “Division”), and Garfield County. 	The land at issue is
section 16 of Township 34 South, Range 8 East, which is found
within the boundaries of Capitol Reef National Park. 1 	Section 16
was granted to the state by Congress in the Utah Enabling Act, on
the condition that the state manage the land for the benefit of
the public school system. 2 	This grant imposes trust obligations
on the state, 3 which the state has accepted and acknowledged in
both the Utah Constitution 4 and by statute. 5 	This appeal
requires us to assess whether SITLA’s decision to approve the
exchange of section 16 is consistent with these obligations.
I. 	ORIGINS OF THE PROPOSED EXCHANGE AND THIS COURT’S PRIOR
DECISION IN NATIONAL PARKS CONSERVATION ASSOCIATION v. BOARD OF
STATE LANDS
¶3 	In 1987, Garfield County approached the Division with a
proposal to acquire section 16 in exchange for three parcels of
land owned by the County. 	Garfield County wanted to acquire
section 16 so that it could pave a portion of the Burr Trail,
which crossed the property. 	As part of its proposals, Garfield
County submitted appraisals of both section 16 and each of the
parcels that it offered in exchange. 	The Division relied on
those appraisals in concluding that the exchange was fair and
permissible under its trust obligations. 	On December 24, 1987,
Governor Norman H. Bangerter executed a patent conveying section
16 to Garfield County. 6
¶4 	NPCA, which had attempted unsuccessfully to intervene
in the exchange proceedings, sought review by this court of the
Division’s decision. 	NPCA challenged the Division’s ruling on a

7 Id. at 912.
8 Id. at 916-21.
9 Id. at 922.
10 Id. at 923.
3 	No. 20070835
number of grounds, two of which are relevant for purposes of this
appeal. 	First, NPCA contended that the Division had violated its
fiduciary duties as trustee of the school trust lands by failing
to give priority to scenic, aesthetic, and recreational values in
its decision to exchange section 16. 	Second, NPCA argued that
the Division breached its fiduciary duties by relying solely on
appraisals commissioned by Garfield County to determine that the
land exchange was fair to the school land trust. 7
¶5 	In NPCA I, we affirmed the Division’s decision to base
its assessment of the fairness of the exchange primarily on
economic, rather than noneconomic, factors. 8 	But we also
determined that the Division had breached its fiduciary duties by
failing to commission an independent appraisal of the land values
to determine whether the exchange was fair to the school land
trust. 	We stated,
For a trustee to rely on appraisals submitted
by a purchaser of trust assets is to leave
the trust subject to sharp dealing on the
part of the purchaser. 	For that reason, we
hold that a breach of trust occurs when a
trustee uses an appraisal submitted by the
purchaser as the basis for ascertaining the
fair market value of a trust asset. 	To
comply with its fiduciary duties, the
Division itself must obtain the appraisals on
which it bases its decision. 9
Accordingly, we stayed the pending exchange and remanded the case
back to the Division “for a determination of whether the
appraised values of section 16 and the Garfield County lands
offered in exchange represent the full value of those lands.” 10
II. 	THE CURRENT DISPUTE
¶6 	Shortly after our decision in NPCA I, the legislature
enacted the School and Institutional Trust Lands Management

11 Utah Code Ann. §§ 53C-1-101 to 53C-5-104 (2009).
12 A limited restricted use appraisal report is one prepared
based on a specific agreement with the client allowing for
certain departures from normal professional appraisal standards.
13 On the same day it appealed the Director’s decision, NPCA
also filed a rulemaking petition. 	This rulemaking petition was
ultimately consolidated with NPCA’s appeal of the Director’s
decision. 	But since NPCA’s rulemaking petition is not before us
on appeal and has no bearing on the resolution of this case, we
(continued...)
No. 20070835 	4
Act, 11 which replaced the Division with SITLA. 	Perhaps as a
result of confusion surrounding this transfer of
responsibilities, the independent appraisal and valuation
mandated in NPCA I never occurred. 	The stay we imposed on the
exchange of section 16 thus remained in effect.
¶7 	Sometime in 2005, after receiving a third-party request
to purchase certain of the lands exchanged by Garfield County for
section 16, SITLA realized that neither it nor the Division had
ever obtained the independent appraisal required to complete the
exchange. 	Accordingly, it commissioned Stanford S. McConkie of
Morley & McConkie, L.C., to conduct an appraisal of section 16
and the lands offered by Garfield County in exchange (the
“McConkie Appraisal”). 	The McConkie Appraisal stated that
section 16 was worth $200,000, while the total value of the lands
offered by Garfield County in exchange was $661,200.
¶8 	NPCA questioned the reliability of the McConkie
Appraisal and commissioned a review of the appraisal by J. Philip
Cook and Virginia H. Hylton (the “Cook Review”). 	Although the
Cook Review determined that the McConkie Appraisal complied with
the Uniform Standards for Professional Appraisal Practice
(“USPAP”), it proffered a higher estimate of section 16’s value,
based on a different view of the property’s “highest and best
use.” 	NPCA also asserted that because the McConkie Appraisal was
a limited restricted use appraisal report (a “limited
appraisal”), 12 it was inadequate to assess the actual values of
the parcels involved in the exchange.
¶9 	On September 15, 2006, the SITLA Director formally
determined that, according to the McConkie Appraisal and SITLA’s
own review, the school lands trust had received full value in
exchange for section 16. 	Accordingly, the SITLA Director
approved the exchange. 	NPCA timely appealed the Director’s
decision to the SITLA Board. 13

(...continued)
do not consider either the Director’s or the Board’s treatment of
the issue.
14 716 P.2d 796 (Utah 1986).
5 	No. 20070835
¶10 	In its petition for review of the Director’s approval
of the exchange, NPCA argued that (1) SITLA had improperly
declined to consider the conflict between economic development
and the protection of section 16’s unique scenic,
paleontological, and archaeological value; (2) the Director’s
approval of the exchange violated applicable law because section
16 constituted inadequate consideration for the lands Garfield
County conveyed in exchange; and (3) the McConkie Appraisal did
not satisfy the dictates of our remand in NPCA I because it was a
limited appraisal rather than a full narrative appraisal and was
methodologically flawed in other respects.
¶11 	The Board first determined, on two separate grounds,
that it lacked jurisdiction to consider NPCA’s contention that
the exchange of section 16 was invalid because Garfield County
received inadequate consideration. 	First, the Board reasoned
that consideration of the issue was beyond the scope of our
remand in NPCA I, which the Board concluded “was limited to
determination of the adequacy of compensation to the school
trust.” 	Second, the Board found that “the legislature ha[d] not
given [the] Board the authority to adjudicate whether Garfield
County exceeded its powers by conveying lands for purportedly
inadequate consideration.”
¶12 	Next, the Board determined that the McConkie Appraisal
was adequate to satisfy SITLA’s fiduciary obligations as outlined
in NPCA I. 	According to the Board, this court’s “directive was
for an independent review of valuation, which was accomplished.”
The Board also determined that the McConkie Appraisal, even
though it was a limited appraisal, was nonetheless adequate
because it was undisputed that it complied with all professional
surveying requirements for limited appraisals. 	In regard to
NPCA’s arguments that the McConkie Appraisal was methodologically
flawed, the Board found that, under NPCA I and our prior decision
in Terracor v. Utah Board of State Lands & Forestry,14 third
parties do not have standing to challenge executive branch real
property transactions.
¶13 	Finally, the Board also rejected NPCA’s argument that
SITLA breached its fiduciary duties by declining to reject the
exchange based on section 16’s unique noneconomic value. 	The

15 See Utah Code Ann. § 63G-4-403(4)(d) (2008).
16 Utah Chapter of the Sierra Club v. Utah Air Quality Bd.,
2006 UT 74, ¶ 15, 148 P.3d 960.
17 Id. ¶¶ 9-10.
No. 20070835 	6
SITLA Board stated that “NPCA ha[d] completely misconstrued the
obligation placed on SITLA” in NPCA I, and that it required
consideration of noneconomic values only in some cases. 	The
Board also determined that NPCA’s arguments on this issue were
barred by principles of res judicata because this court had
determined, in NPCA I, “that the Division had in fact adequately
considered aesthetic and recreational values in deciding to
exchange section 16” and had also appropriately declined to give
such values priority over economic considerations.
¶14 	Accordingly, the Board ruled that NPCA had failed to
establish that the Director’s approval of the section 16 exchange
was unlawful and dismissed NPCA’s appeal. 	NPCA timely filed a
petition for review of final agency action with this court. 	We
have jurisdiction pursuant to section 78A-3-102(3)(e)(iii) of the
Utah Code.
STANDARD OF REVIEW
¶15 	In reviewing a final action of the SITLA Board in a
formal adjudicative proceeding, we grant relief only when the
“person seeking judicial review has been substantially
prejudiced” by, among other things, the agency’s erroneous
interpretation or application of the law. 15 	A person is
“substantially prejudiced” when the agency’s erroneous
interpretation or application is not harmless. 16 	We review that
agency’s interpretation or application of the law for
correctness. 17
ANALYSIS
¶16 	We begin by discussing whether NPCA has standing to
challenge the SITLA Board’s determinations. 	Concluding that it
does, we next turn to the issue of whether the SITLA Board erred
in finding that it lacked jurisdiction to invalidate the exchange
on the ground that Garfield County received inadequate
consideration. 	We determine that the Board did not err.
Finally, we address whether the SITLA Board correctly found that
the Director’s reliance on the McConkie Appraisal was consistent
with SITLA’s trust obligations. 	We affirm the Board on that
ground as well. 	In light of these determinations, we do not

18 Id. ¶ 18.
19 869 P.2d 909, 913 (Utah 1993).
20 Utah Chapter of the Sierra Club v. Utah Air Quality Bd.,
2006 UT 74, ¶ 35, 148 P.3d 960.
21 NPCA I, 869 P.2d at 913-14.
7 	No. 20070835
reach the parties’ arguments regarding the scope of our remand in
NPCA I or the extent to which NPCA’s challenges may be barred by
res judicata.
I. 	NPCA HAS STANDING TO CHALLENGE THE ADEQUACY OF THE MCCONKIE
APPRAISAL
¶17 	We first determine whether NPCA has standing to raise
its challenges to the SITLA Director’s decision to proceed with
the exchange of section 16. 	On appeal, NPCA raises two
challenges to the Director’s decision. 	First, it asserts that
the exchange is invalid because SITLA violated its trust
obligations by approving the exchange of section 16 even though
section 16 constituted inadequate consideration for the lands
Garfield County conveyed in exchange. 	Second, it challenges
whether the McConkie Appraisal satisfies the requirements of our
NPCA I remand. 	We must determine whether NPCA has standing to
bring each of these challenges.
¶18 	We have recognized that parties may obtain standing
under either the traditional or an alternative test. 18 	In NPCA
I, we analyzed NPCA’s standing solely under the alternative
test, 19 which requires that a party prove that it is an
appropriate party to raise an issue of significant public
importance. 20 	We concluded that NPCA’s challenges to the
exchange of section 16 raised issues of great public importance
regarding the administration of school trust lands and that NPCA,
based on its interest and expertise, was an appropriate party to
present these issues for judicial resolution. 21 	Because this
case grows out of our decision in NPCA I and challenges the same
conveyance for which we found alternative standing in that case,
we see no reason why our determination that NPCA had standing to
challenge the exchange of section 16 in NPCA I does not apply to
its challenges in this case.
¶19 	SITLA argues that the issue of public importance
justifying our finding of alternative standing in NPCA I is not
implicated by NPCA’s challenges in this case. 	Specifically,
SITLA contends that the sole issue justifying alternative

22 Id. at 914.
23 See id. at 917-23 (reaching the merits of both issues).
24 Before the SITLA Board, NPCA also argued that SITLA had
breached its trust obligations by failing to adequately consider
section 16’s unique noneconomic attributes in approving the
exchange. 	The Board ruled against NPCA on this issue and NPCA
seems to have abandoned that version of its argument on appeal.
NPCA no longer argues that the exchange should be reversed
because of SITLA’s inadequate consideration of section 16’s
noneconomic attributes. 	Instead, it bases its argument for
reversing the exchange on the other grounds addressed in our
opinion and mentions consideration of noneconomic factors only as
an alternative management strategy for section 16 that NPCA
believes would be consistent with SITLA’s trust obligations.
Because we affirm the Board’s findings that the exchange was
lawful, we do not reach this issue.
No. 20070835 	8
standing in NPCA I was whether the state was required to give
priority to “unique scenic, recreational, archaeological, and
paleontological values” in administering school trust lands. 22
SITLA asserts that this court, in NPCA I, “fully resolved the
policy issues before it” and therefore “no such significant
policy issues are present on remand.”
¶20 	We disagree. 	In NPCA I, we reached the merits of
NPCA’s claims that SITLA breached its fiduciary duties by
approving the exchange based on an unreliable appraisal. 23 	And
although NPCA’s claims in this case are somewhat refined given
our resolution of NPCA I, the essence of NPCA’s challenges in
this case is the same. 	Accordingly, our grant of standing in
NPCA I is fully determinative of the standing issue in this case.
We now turn to the merits of NPCA’s claims.
II. 	SITLA DID NOT BREACH ITS FIDUCIARY DUTIES BY APPROVING THE
EXCHANGE OF SECTION 16
¶21 	NPCA argues that the SITLA Board should have reversed
the Director’s decision on two separate grounds: 	(1) SITLA
breached its duty to ensure that trust lands are managed
according to applicable law by approving a transaction that
resulted in Garfield County receiving inadequate consideration,
and (2) SITLA breached its duty to base its exchange decision on
a reliable appraisal by relying on the McConkie Appraisal to
approve the exchange. 24 	We affirm the Board’s determinations
that (1) the SITLA Board was without jurisdiction to invalidate
the exchange based on the amount of consideration received by

25 Hi-Country Estates Homeowners Ass’n v. Bagley & Co., 901
P.2d 1017, 1021 (Utah 1995) (“When a ‘specific power is conferred
by statute upon a tribunal, board, or commission with limited
powers, the powers are limited to such as are specifically
mentioned.’” (quoting Union Pac. R.R. v. Pub. Serv. Comm’n, 134
P.2d 469, 474 (Utah 1943))).
26 See Utah Code Ann. § 53C-1-304(4)(a) (2009) (“The board
shall uphold the decision of the director or the administration
unless it finds, by a preponderance of the evidence, that the
decision violated applicable law, policy, or rules.”); see also
id. § 53C-1-204(2) (“The board shall ensure that the
(continued...)
9 	No. 20070835
Garfield County and (2) the McConkie Appraisal is not per se
unreliable simply because it is a limited appraisal.
A. 	The SITLA Board Correctly Determined That It Lacked
Jurisdiction to Invalidate the Exchange of Section 16 on the
Ground That Garfield County Received Insufficient Consideration
¶22 	NPCA contends that the SITLA Board should have found
that the Director’s decision to approve the exchange of section
16 violated SITLA’s fiduciary duties because it was not in
accordance with “applicable law.” 	Section 53C-1-304(4)(a) of the
Utah Code provides that the Board, in reviewing a decision of the
SITLA Director, should reverse the decision only when “it finds,
by a preponderance of the evidence, that the decision violated
applicable law, policy, or rules.” 	NPCA claims that the exchange
violated applicable law because section 16 constituted inadequate
consideration for the lands Garfield County conveyed in exchange.
¶23 	We determine that the SITLA Board’s jurisdiction
extends only to ensuring that SITLA complied with its own
statutory and fiduciary duties. 	As a result, we conclude that
because SITLA was under no duty to ensure that Garfield County
obtained adequate consideration in the exchange, the SITLA Board
correctly determined that it had no jurisdiction to invalidate
the exchange of section 16 on this ground.
¶24 	As a statutorily created body of limited jurisdiction,
the SITLA Board may rule only on issues over which it has been
granted subject matter jurisdiction by the legislature. 25 	And,
according to statute, the Board’s authority as an adjudicative
body is limited to reviewing the actions of SITLA and its
director regarding the management of the school trust lands in
order to ensure that those decisions are consistent with
applicable law. 26 	In other words, the Board exists to ensure

26 (...continued)
administration is managed according to law.”).
27 NPCA I, 869 P.2d at 918 (“The duties of a trustee apply
to the state in administering school trust lands. 	All trustees
owe fiduciary duties to the beneficiaries of the trust. 	The duty
of loyalty requires a trustee to act only for the benefit of the
beneficiaries and to exercise prudence and skill in administering
the trust.” (citations omitted)).
28 Utah Code Ann. § 53C-1-302(1)(b)(iv).
29 Id. § 53C-1-302(3).
No. 20070835 	10
that the school trust lands are managed in accordance with the
constitutional, statutory, and fiduciary duties imposed on SITLA
by virtue of its position as trustee.
¶25 	These duties do not include monitoring whether Garfield
County received adequate consideration. 	Instead, SITLA is
obligated, according to general trust law, to manage the trust
lands in the interests of the beneficiaries--the public school
system and its students. 27 	Statutorily, SITLA is required to
manage the trust lands “in the manner . . . most favorable to the
beneficiaries” 28 and is charged with “maintain[ing] the integrity
of the trust and prevent[ing], through prudent management, the
misapplication of its lands and revenues.” 29 	None of the laws
governing SITLA impose a duty to monitor the actions of third
parties for compliance with those parties’ own separate legal
duties. 	SITLA’s fiduciary responsibilities run to the school
lands trust and its beneficiaries, not to third parties such as
Garfield County.
¶26 	NPCA argues that the SITLA Board’s authority to reverse
a decision of the SITLA Director that violates applicable law,
policy, or rules authorizes the Board to determine, in this case,
whether Garfield County received adequate consideration. 	This
argument presumes that the statutory provision confers authority
on the SITLA Board to examine and rule on the legality of all
aspects of the action approved by the SITLA Director. 	In other
words, NPCA proposes that the authority to make general
determinations regarding the legality of the exchange between
SITLA and Garfield County is part and parcel of the SITLA Board’s
mandate to determine whether the SITLA Director’s decision
conformed to applicable law.
¶27 	This reading stretches the statute too far, essentially
converting the SITLA Board into a court that passes judgment on

30 Id. § 53C-1-304(4)(a).
11 	No. 20070835
the action of involved third parties under the guise of reviewing
the actions of SITLA and its Director. 	Although the statute
creating the SITLA Board charges it with the responsibility of
ensuring that SITLA is managed according to law, the clear intent
of the statutory provisions defining the SITLA Board’s purpose
and authority is to enable the Board to determine whether the
Director is managing SITLA in accordance with its fiduciary and
statutory obligations. 	Accordingly, the scope of the Board’s
authority to review SITLA’s actions is limited to “decision[s] of
the director or the administration.” 30 	And the SITLA Director’s
decision to approve a transaction is distinct from the separate
decision of a third party--such as Garfield County in this case--
to enter into a transaction with SITLA.
¶28 	Thus, the Board is not authorized to pass judgment on
whether third parties have fulfilled their own independent legal
responsibilities because the Board’s review authority only
extends to actions taken by SITLA or its Director. 	It is up to
Garfield County, not SITLA, to ensure that its actions comport
with its legal obligations. 	Since there is no duty on the part
of SITLA or its Director to ensure that Garfield County has been
adequately compensated, the Board is not the appropriate
decision-making body to assess the legality of Garfield County’s
actions. 	Accordingly, we affirm the SITLA Board’s determination
that it lacked jurisdiction to invalidate, based on the amount of
consideration received by Garfield County, SITLA’s decision to
approve the exchange of section 16.
B. 	The McConkie Appraisal Is Not Unreliable Simply Because It Is
a Limited Appraisal
¶29 	NPCA also argues that SITLA wrongfully relied on the
McConkie Appraisal because the McConkie Appraisal is unreliable
given that it is a limited appraisal rather than a full narrative
appraisal. 	Noting that limited appraisals are based on
undisclosed agreements with the client that allow for certain
departures from normal required appraisal procedures, NPCA
contends that these departures impact the ultimate valuation and
make it impossible for third parties (who are not privy to the
agreement between the appraiser and the client) to evaluate the
correctness of the appraisal’s conclusions.
¶30 	We reject NPCA’s suggestion that SITLA can never use
limited appraisals as a basis for its management decisions over
school trust lands. 	While it is true that, in NPCA I, we
acknowledged that the Division had a duty to obtain “reliable

31 869 P.2d 909, 921-22 (Utah 1993).
32 Id. at 922.
33 Even though limited appraisals are based on undisclosed
agreements with the client regarding (1) the purpose of the
appraisal and (2) the allowed departures from normal professional
surveying standards, this does not prevent the party from being
able to assess the limited appraisal’s reliability. 	The
challenging party is always free to perform its own independent
appraisal review (as NPCA did here) or to obtain, through
discovery, the actual agreement between SITLA and the appraiser
that sets forth the purpose and specific limitations of the
appraisal.
No. 20070835 	12
appraisals,” 31 our conclusion that nonindependent appraisals were
per se unreliable was based on our determination that a
nonindependent appraisal was “suspect on its face” because of the
incentive and opportunity of the interested party to shop for
favorable appraisals. 32 	It was the suspect motive that made the
reliance on nonindependent appraisals per se unreasonable.
¶31 	This concern is absent when the appraisal, although
limited in scope and purpose, is independently commissioned by
SITLA. 	There is nothing inherently unreliable about limited
appraisals. 	Such appraisals are obtained for a specific purpose,
and, given the context in which they will be used, may not
require the same panoply of procedures and considerations that
enable a full appraisal to be deemed reliable for all purposes.
Therefore, because limited appraisals are not inherently
unreliable, the decision to rely on such an appraisal in managing
school trust lands is one that is within the discretion of SITLA,
as trustee, to make.
¶32 	We emphasize that SITLA’s discretion to obtain and rely
on a limited appraisal does not mean that its decision to do so
is immune to challenge. 	If a third party suspects that a limited
appraisal is inaccurate and therefore that a certain management
decision based on that appraisal is not consistent with SITLA’s
obligations as trustee, it may challenge the transaction in the
same way it would challenge a transaction based on the
conclusions of a full narrative appraisal. 33 	Therefore, if the
party can establish that (1) the limited appraisal’s valuation
conclusions are erroneous and (2) SITLA’s reliance on these
erroneous conclusions fell below the standard of care imposed on
it as trustee by law, then the action by SITLA should be set
aside as a breach of trust. 	We simply make clear that a party
challenging SITLA’s actions is not entitled to have the actions

13 	No. 20070835
set aside solely because SITLA took those actions in reliance on
a limited appraisal.
¶33 	In this case, NPCA has pointed to statements in both
the Cook Review and the original McConkie Appraisal that suggest
the McConkie Appraisal’s valuation of section 16 may be
inaccurate. 	But NPCA only argues that the McConkie Appraisal
overvalues section 16. 	In other words, NPCA contends that, had
the McConkie Appraisal valued section 16 correctly, it would have
revealed that SITLA obtained an even better bargain for the
school trust.
¶34 	Therefore, even if NPCA is correct in concluding that
the McConkie Appraisal was technically defective, it acknowledges
that section 16’s value is no greater than $200,000, or more than
three times less than the value of the lands that SITLA received
in exchange. 	In light of our holding that the inadequacy of
consideration received by Garfield County provides no basis for
the SITLA Board to set aside the exchange, the errors that NPCA
alleges occurred with the McConkie Appraisal--even if true--fail
to show that the SITLA Director’s decision was in breach of
SITLA’s trust obligations. 	Accordingly, we decline to reach
NPCA’s specific arguments regarding the flaws in the McConkie
Appraisal and affirm the SITLA Board’s determination that the
Director’s decision was consistent with SITLA’s fiduciary duties
as trustee.
CONCLUSION
¶35 	We hold that NPCA has standing to challenge the SITLA
Director’s decision to exchange section 16. 	But we conclude that
the SITLA Board correctly determined that SITLA’s approval of the
exchange of section 16 was consistent with its trust obligations.
Accordingly, we affirm the Board’s dismissal of NPCA’s appeal.
---
¶36 	Justice Wilkins and Justice Parrish concur in Associate
Chief Justice Durrant’s opinion.
---
NEHRING, Justice, dissenting:
¶37 	I respectfully dissent. 	I believe the difference in
value between section 16 and the property that SITLA was to
receive from Garfield County is so great that it violated the
clear and unequivocal constitutional and statutory proscription

No. 20070835 	14
against transferring public property for less than fair market
value. 	NPCA argues, persuasively in my view, that the Board
erred because the remand in NPCA I was not limited to directing
that an unbiased appraisal be obtained for the section 16 lands,
but that it also mandated review of the relative value of the
lands exchanged. 	NPCA’s reasoning for this interpretation of our
mandate on remand turns on its view that an unbiased appraisal
was merely the means to achieve the end of ensuring that an
accurate value for both parcels was ascertained, resulting
thereby in a lawful, fair exchange. 	NPCA also argues that the
remand for a new appraisal did not preclude a subsequent
challenge to the equality of the exchange based on information
found in the appraisal. 	In support of this position, NPCA points
to language in NPCA I stating that the Board is subject to a
broad duty to “act according to applicable law.” 	869 P.2d 909,
921 n.9 (Utah 1993). 	NPCA points out that the law requires the
county to receive fair market value for the property it gave up
in the exchange. 	See Price Dev. Co. v. Orem City, 2000 UT 26,
995 P.2d 1237; Salt Lake County Comm’n v. Salt Lake County Att’y,
1999 UT 73, 985 P.2d 899; Mun. Bldg. Auth. of Iron County v.
Lowder, 711 P.2d 273 (Utah 1985); Sears v. Ogden City, 572 P.2d
1359 (Utah 1977).
¶38 	The mandate rule “dictates that pronouncements of an
appellate court on legal issues in a case become the law of the
case and must be followed in subsequent proceedings of that
case.” 	Thurston v. Box Elder County, 892 P.2d 1034, 1037-38
(Utah 1995). 	In proceedings on remand, an “unwavering fidelity
to the letter and spirit of the mandate” is required. 	Campbell
v. State Farm Mut. Auto. Ins. Co., 2004 UT 34, ¶ 5, 98 P.3d 409.
This does not mean, however, that the remand “elevates all of the
statements in the . . . opinion to the status of a holding,
thereby binding [the SITLA board] to what would otherwise be
properly deemed dicta.” 	Id. ¶ 6.
¶39 	Our starting point for determining the letter and the
spirit of the NPCA I remand is the text of the case itself. 	The
NPCA I conclusion states:
We remand this case to the Division for
a determination of whether the appraised
values of section 16 and the Garfield County
lands offered in exchange represent the full
value of those lands.
The stay presently in effect will
continue until the Division makes the
requisite determinations that the value of

15 	No. 20070835
the land exchanged for section 16 is adequate
under its trust obligations.
NPCA I, 869 P.2d at 923 (emphasis added).
¶40 	This articulation of our mandate centers on the
obligation to lawfully determine value of the properties. 	The
appraisal is an instrument in the service of the quest for value.
¶41 	The first paragraph of the NPCA I conclusion clearly
speaks to appraisals of both section 16 and the Garfield County
land. 	It also indicates that the purpose of the appraisal should
be to determine the full value of the lands. 	In order to
determine the full value of the lands, an accurate appraisal is
required. 	Although we did not address the merits of NPCA’s
request for declaratory action on this issue in NPCA I, we did
acknowledge that “NPCA had a legal interest for the purpose of a
declaratory ruling in determining whether the Division was using
correct appraisal procedures with respect to trust lands.” 	Id.
at 916. 	The requirement that the appraisal use correct appraisal
standards is logically included within the direction to determine
“whether the appraised values of section 16 and the Garfield
County lands offered in exchange represent the full value of
those lands.” 	Id. at 923. 	Procuring an appraisal by an unbiased
appraiser does nothing to contribute to the goal of determining
the real value of the lands if the appraisal is materially
flawed. 	The majority grounds its ratification of SITLA’s conduct
on the conclusion that the SITLA board had no jurisdiction to
oversee the Garfield County side of the land exchange. SITLA’s
duties were limited to “actions of SITLA and its director.”
Although the majority does not speak directly to the question of
the scope of our remand in NPCA I, it would be fair to infer that
our remand mandate cannot be interpreted to confer jurisdiction
on SITLA which has not been conferred by statute.
¶42 	NPCA urges us to interpret our remand instructions to
extend beyond an examination of the adequacy of the appraisal and
to encompass an examination of whether the exchange was fair to
Garfield County. 	The NPCA argument that we should evaluate
whether the exchange was fair to both parties is based on
language in a footnote responding to an argument made in a
concurring opinion. 	The concurrence pointed out that although
“the state’s duties to the school system are important, they
cannot and do not override every other obligation” and that “[a]
. . . trustee must manage trust property in accordance with the
law, and a trustee’s duty to obey the law is higher than his or
her duty to the beneficiaries.” 	NPCA I, 869 P.2d at 923 & n.1
(Durham, J., concurring in the result). 	The majority responded,

No. 20070835 	16
agreeing in part. 	It stated that “trustees have a duty to act
according to applicable law.” 	Id. at 921 n.9. 	NPCA relies on
this phrase to support its argument that, with an unbiased
appraisal in hand, we should now examine the results of that
appraisal to determine whether the exchange was lawful. 	It
argues that an examination of the exchange demonstrates that it
was unfair to the county and therefore unlawful.
¶43 	In the portion of NPCA I discussing the duty of the
trustee to obtain reliable appraisals, we pointed out that the
problem with allowing the buyer to obtain the appraisal is that
it gives the buyer “the opportunity to shop for favorable
appraisals” and “leave[s] the trust subject to sharp dealing on
the part of the purchaser.” 	Id. at 922. 	Although the section on
appraiser bias was concerned primarily with the potential injury
to the trust and our analysis elsewhere in NPCA I focused
primarily on whether noneconomic factors should be given
preference over the goal of maximizing trust income, we did
acknowledge that part of our inquiry in the case was “whether the
Division properly administered the school land trust.” 	Id. at
916. 	Additionally, we noted that “[c]ourts generally have
broader powers in trust cases in making certain that trusts are
properly administered” in holding that NPCA had a limited right
of intervention on the issue of whether “the Division breached
its trust duty by not securing appraisals for both section 16 and
Garfield County’s land from appraisers either retained or
employed by the Division.” 	Id. at 922 & n.11.
¶44 	Determining SITLA’s treatment of noneconomic factors
and its use of a biased appraisal were constituent elements of
the larger issue of whether SITLA properly administered the trust
when making the land exchange. 	Just because we decided those two
elements, however, does not necessarily preclude other errors of
trust administration from being raised once a valid appraisal is
obtained. 	Because lawfulness of the trust administration was a
concern in NPCA I and an unequal exchange could potentially be
unlawful, the scope of the remand alone does not preclude us from
considering NPCA’s argument.
---
¶45 	Chief Justice Durham concurs in Justice Nehring’s
dissenting opinion.