Leiter Minerals, Inc. v. California Co.

126 So. 2d 76, 14 Oil & Gas Rep. 768, 1961 La. App. LEXIS 1682
CourtLouisiana Court of Appeal
DecidedJanuary 3, 1961
DocketNo. 21569
StatusPublished
Cited by8 cases

This text of 126 So. 2d 76 (Leiter Minerals, Inc. v. California Co.) is published on Counsel Stack Legal Research, covering Louisiana Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Leiter Minerals, Inc. v. California Co., 126 So. 2d 76, 14 Oil & Gas Rep. 768, 1961 La. App. LEXIS 1682 (La. Ct. App. 1961).

Opinion

YARRUT, Judge.

This case was transferred here by our Supreme Court because it involves a declaratory judgment (Leiter Minerals, Inc. v. California Company et al., 239 La. 116, 118 So.2d 124), and followed the modification of a decree of the U. S. Court of Appeals, Fifth Circuit, 224 F.2d 381, by the Supreme Court of the United States, 352 U.S. 220, 77 S.Ct. 287, 292, 1 L.Ed.2d 267, with a recommendation in the following language:

“The Government contends that Act No. 315 of 1940 does not apply when the parties themselves have contracted for a reservation of specific duration and that if the statute is -construed to apply to this situation it would impair the obligation of the Government’s contract. Petitioner disagrees. The Supreme Court of Louisiana has never considered the specific issue or even discussed generally the rationale of the statute, especially with reference to problems of constitutionality. The District Court [127 F.Supp. 439] recognized the importance of the statute in deciding this case; it also recognized that a problem of interpretation was involved, that 'the statute cannot be read by him who runs. What are the [78]*78situations to which the statute is applicable? Is the statute merely declaratory of prior Louisiana law? What are the problems that it was designed to meet? The answers to these questions are or may be relevant. Before attempting to answer them and to decide their relation to the issues in the case, we think it advisable to have an interpretation, if possible, of the state statute by the only court that can interpret the statute with finality, the Louisiana Supreme Court. The Louisiana declaratory judgment procedure appears available to secure such an interpretation, La.Rev.Stat., 1950, § 13 :- 4231 et seq., and the United States of course may appear to urge its interpretation of the statute. See Stanley v. Schwalby, 147 U.S. 508, 512-513, 13 S.Ct. 418, 419, 420, 37 L.Ed. 259. It need hardly be added that the state courts in such a proceeding can decide definitively only questions of state law that are not subject to overriding federal law.
“We therefore modify the judgment of the Court of Appeals to permit an interpretation of the state statute to be sought with every expedition in the state court in conformity with this opinion.”

Plaintiff contends that the Act of 1940 makes imprescriptible all mineral reservations in transfers to the United States; while defendants contend it does not apply to a mineral reservation specifically limited ex contractu as to time and manner of exercise in the deed of acquisition.

The District Court held: (1) Though the deed from Thomas Leiter to the United States was executed in 1938, the 1940 statute was applicable, being retrospective in its operation, and made Leiter’s mineral reservation imprescriptible; and (2) As so interpreted and applied, such statute is constitutional.

The land was acquired in December 1938, by conventional sale to the United States, subject to the following mineral reservation by the vendor (plaintiff) :

“The Vendor reserves from this sale the right to mine and remove, or to grant to others the right to mine and remove, all oil, gas and other valuable minerals which may be deposited in or under said lands, and to remove any oil, gas or other valuable minerals from the premises; the right to enter upon said lands at any time for the purpose of mining and removing said oil, gas and minerals, said right, subject to the conditions hereinafter set forth, to expire April 1, 1945, it being understood, however, that the vendors will pay to the United States of America, 5% of the gross proceeds received by them as royalties or otherwise from all oil or minerals so removed from in or under the aforedescribed lands, until such time as the vendors shall have paid to the United States of America, the sum of $25,000, being the purchase price paid by said United States of America for the aforedescribed properties.”

The statute involved, Act 315 of 1940, LSA-R.S. 9 :5806, inter alia, provides:

“When land is acquired by conventional deed or contract, condemnation or expropriation proceedings by the United States of America, or any of its subdivisions or agencies, from any person, firm, or corporation, and by the act of acquisition, verdict, or judgment, oil, gas, or other minerals or royalties are reserved, or the land so acquired is by the act of acquisition conveyed subject to a prior sale or reservation of oil, gas, or other minerals or royalties, still in force and effect, the rights so reserved or previously sold shall be imprescribable.”

The Act of 1940 was the successor to two Acts of 1938 (Nos. 68 and 151) in effect when the Government acquired the property from plaintiff, containing the same recital as to imprescriptibility against the United States.

[79]*79The fundamental concept of mineral reservations in Louisiana, as well as the history and public policy of Act 315 of 1940, is so well epitomized in an article in Louisiana Law Review, Vol. 13, p. 153, that we quote therefrom, as follows:

“One of the cardinal principles of Louisiana mineral law is the 'non-ownership’ theory of mineral rights. In the main, the non-ownership theory is grounded upon the simple civilian concept that there are but two separate kinds of interest in land — full ownership and servitudes. One of the best statements of the Louisiana Law on the subject is found in the opinion of the Louisiana Supreme Court in the celebrated case of Wemple v. Nabors Oil and Gas Company, 154 La. 483, 97 So. 666. So firmly fixed is this concept that only in one other area has there been a successful attempt to create separate estates in realty, that establishing the separate estate in timber. La. R.S.1950, 9:1103.
“Act 315 of 1940 in effect states that a mineral servitude reserved by a landowner in a sale of land to the federal government will not be extinguished by ten years non-user, nor shall it be governed by the other codal provisions relative to prescription. It has been the policy of -our Supreme Court that if an owner of a servitude fails to take advantage of it and use it for a period of ten years, the law will consider it abandoned, and the servitude will be extinguished, Bodcaw Lumber Co. v. Magnolia Petroleum Co., 167 La. 847, 120 So. 389. This is consistent with the general policy that elements of commerce should not be tied up for long periods of time. Act 315 creates either a separate mineral estate or a perpetual servitude. Both are foreign to prior concepts of Louisiana mineral law, Frost-Johnson Lumber Co. v. Salling’s Heirs, 150 La. 756, 91 So. 207; Rives v. Gulf Refining Co., 133 La. 178, 62 So. 623.
“Louisiana’s prescription laws are the legal expression of public policy. If the Legislature decides to change the general land policy of the state, the legality of such legislation cannot be questioned as long as no state or federal constitutional provision is infringed. The wisdom of such changes, however, is subject to inquiry.

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126 So. 2d 76, 14 Oil & Gas Rep. 768, 1961 La. App. LEXIS 1682, Counsel Stack Legal Research, https://law.counselstack.com/opinion/leiter-minerals-inc-v-california-co-lactapp-1961.