Raynolds v. Hinkle

24 P.2d 738, 37 N.M. 493
CourtNew Mexico Supreme Court
DecidedJuly 12, 1933
DocketNo. 3762.
StatusPublished

This text of 24 P.2d 738 (Raynolds v. Hinkle) is published on Counsel Stack Legal Research, covering New Mexico Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Raynolds v. Hinkle, 24 P.2d 738, 37 N.M. 493 (N.M. 1933).

Opinion

BIOKLEY, Justice.

Appellant filed liis claim with the Commissioner of Public Lands for refund alleged to have been ei’roneously paid by him. The proceeding is under the provisions of chapter 99, Laws 1931.

Appellee, commissioner, indorsed his disapproval thereon and filed it in the district court of Santa Fé county, together with a statement of facts upon which his disapproval was based. Upon the record before the district court, a transcript of which is before us, the court sustained the commissioner.

It appears that Commissioner Field, on October 1, 1922, issued to Pope a grazing lease for 47,459.48 acres of state land for a term of five years from that date, and for a rental of 5 cents per acre per year. A down payment of one-fifth was made and the remainder was evidenced by four equal, joint, and several promissory notes of even date signed by the lessee and by two other persons satisfactory to the commissioner, due in one, two, three, and four years, respectively, as provided by section 132-114, Comp. St. 1929. Each of the notes bore 12 per cent, interest from maturity, and each contained a provision for acceleration of the due date upon default of the lease to the effect that, upon such default, all of the notes would become due and payable at once. Lessee Pope failed to pay the notes which fell due on October 1, 1923 and 1924, respectively. On December 9, 1924, Martinez filed two applications to lease the land covered by the Pope lease at a rental of 3 cents per acre.

Prior to the date of the applications by Martinez and subsequent to the date of the issuance of the Pope leases, the then commissioner, Baca, had issued a general order reducing the rental charge on all state grazing lands to the sum of 3 cents per acre. On May 9, 1923, and August 17, 1923, the then Attorney General rendered opinions addressed to the commissioner, Baca, to the effect that the commissioner had authority to re- ' duee the rentals on ¡state lands for grazing purposes to 3 cents per acre as to future leases, but that such reductions could not lawfully apply to existing leases or any portion thereof. Opinions Nos. 3705-3730.

■ At the time of considering the application of Martinez, the commissioner was confronted with the question of business policy as to whether to exercise his option to forfeit the Pope lease on account of his default or to look to the notes and the security of the lien upon the improvements placed upon the land by Pope. Sections 132-116, 132-121, Comp. St. 1929. Exercising what seemed to him a proper discretion, Commissioner Swope required that Martinez deposit with him $5,000 for the purpose of protecting the state against any loss by reason of the state releasing its claim of lien against the improvements on the land in the amount of the unpaid Pope notes and interest thereon, after maturity. This deposit being made, two leases were made to Martinez, covering in the aggregate the land described in the Pope lease, on the basis of a rental of 3 cents per acre per annum, and thereafter on January 27, 1925, Commissioner Swope canceled the Pope lease and the said two leases issued in lieu thereof were delivered to Martinez. Thereafter, appellant purchased the interest of Pope in the land and improvements at a deed of trust foreclosure sale and secured a master’s deed therefor. Appellant also purchased from Martinez one of said leases which covered 39,906.41 acres except one section, and on April 16, 1925, filed in the commissioner’s office an assignment in due form, assigning said lease from Martinez to appellant. Commissioner Swope refused to approve the assignment until appellant should pay into his office the sum of $5,723.17, which was the amount the commissioner claims was owing on the Pope lease and notes secured by lien; the sum so demanded being made up of the following items:

“Due October 1, 1923, Note No. 1, Pope Lease, $2,387.97.
“Interest on same from October 1,. 1923, to January 27, 1925, at 12 per cent, per annum, $387.09.
“Due from October 1, 1924, Note No. 2, Pope Lease, Interest at 12 per cent, per annum, to Jan. 27, 1925, $91.54.
“Difference in rentals between' Pope Lease and the ■ two Martinez leases, for the years commencing October 1, 1924, 1925 and 1926, respectively, each in the sum of $955.19, and the three aggregating $2,865.57.”

After considerable negotiations between the appellant through his agents and attorneys, in which arguments pro and con, on the correctness of the commissioner’s position were indulged, the appellant paid the sum demanded of him, protesting that it was an overpayment and unlawful demand. Whereupon the commissioner approved the assignment by Martinez to appellant. At the time of such payment, the Pope notes were held by the commissioner; they not having been passed into the hands of a purchaser.

The alleged erroneous payments for which refund is claimed by appellant is the difference between 5 cents per acre provided for in the two Pope rental notes, and the Martinez rental, amounting in the aggregate to $1,-910.38, and interest on the Pope note No. 1 from October 1, 1923, to January 27, 1925, at 12 per cent, interest, $287.09, and interest on Pope ¡note No. 2, from October 1, 1924, •to January 27, 1925, at 12 per cent, interest, $91.54, a total amount of $2,389.01.

Appellant advances the proposition that the relationship between the state and a lessee of state lands is that of landlord and tenant, and governed by the general rules of law governing such relations. That under some circumstances, such general rules may be of assistance, we do not doubt. They were invoked in American Mortgage Co. v. White, 34 N. M. 602, 287 P. 702, 703. One of these rules, says appellant, is that: “A re-entry for breach of covenant or condition precludes the right to recover rent which has not accrued before re-entry.” 35 C. J. p. 1077.

The commissioner may have concluded that the contract was an entire one, the lease term being for the full term of five years, and that the down payment in advance and the acceptance of the four notes was equivalent to payment in advance. Section 132-121, Comp. St. 1929, would seem to lend color to such a conclusion because it is therein provided that in case of the nonpayment of rental notes, upon notice to lessee and other makers of the notes, the lessee fails to comply with the demand made in such notice, the other makers upon such rental notes, may pay same and have the rights of such lessee transferred to them, and also in case of default of payment of such notes, any creditor of the lessee may pay same and have the rights of any such lessee transferred to him. If the commissioner so viewed the matter, he would have found support for the view that where rent is payable in advance, the tenant is the one to suffer by reason of the nonapportionability of the rent; the lessor being, it seems, entitled to the rent for the whole period, though he re-enters the day after it falls due. See Tiffany, Landlord and Tenant, p. 1179. But it is not necessary that we make any declaration upon this interesting question. When Pope failed to pay a rental note when it fell due, all the notes became due.

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Related

State Ex Rel. Otto v. Field
241 P. 1027 (New Mexico Supreme Court, 1925)
American Mortgage Co. v. White
287 P. 702 (New Mexico Supreme Court, 1930)
American Inv. Co. v. Lyons
218 P. 183 (New Mexico Supreme Court, 1923)

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Bluebook (online)
24 P.2d 738, 37 N.M. 493, Counsel Stack Legal Research, https://law.counselstack.com/opinion/raynolds-v-hinkle-nm-1933.