State ex rel. Commissioners of Land Office v. Phillips Petroleum Co.

1953 OK 395, 258 P.2d 1193, 2 Oil & Gas Rep. 1325, 1953 Okla. LEXIS 477
CourtSupreme Court of Oklahoma
DecidedApril 7, 1953
DocketNo. 35183
StatusPublished
Cited by13 cases

This text of 1953 OK 395 (State ex rel. Commissioners of Land Office v. Phillips Petroleum Co.) is published on Counsel Stack Legal Research, covering Supreme Court of Oklahoma primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
State ex rel. Commissioners of Land Office v. Phillips Petroleum Co., 1953 OK 395, 258 P.2d 1193, 2 Oil & Gas Rep. 1325, 1953 Okla. LEXIS 477 (Okla. 1953).

Opinion

HALLEY, Chief Justice.

Phillips Petroleum Company commenced this action in the District Court of Gar-vin County against the Commissioners of the Land Office to quiet its title to an oil and gas lease covering an undivided one-half interest in the minerals in 60 acres of land in that county. The parties will be referred to as “Phillips” and “Commissioners’’.

The facts from which this controversy arose are as follows: The Commissioners acquired the land involved by foreclosure proceedings. Through their regular procedure the Commissioners determined to offer the land for sale. It was duly appraised and being deemed valuable for oil and gas, it was ordered that the surface rights only be offered for sale. The Notice of Sale published provided that the purchaser of this particular tract, being “Tract No. 18” in the Notice of Sale, would receive “no mineral rights whatsoever.” W. H. Lamascus was the highest bidder for this tract.

November 4, 1940, the sale was approved by the Commissioners and a Certificate of Purchase ordered issued to W. H. Lamas-cus. A clerk in the office of the Commissioners inadvertently failed to' change the printed form of Certificate of Purchase to reserve all of the minerals and issued a Certificate of Purchase reserving only one-half of the minerals. This error and a similar one in issuing Patent formed the basis of this controversy.

December 21, 1945, W. H. Lamascus and wife executed an oil and gas lease covering an undivided one-half interest in the minerals. This lease was assigned to Phillips.

February 10, 1947, after full payment of the purchase price, the' Commissioners approved the issuance of a patent. In the preparation of the Patent'the same error was made as in the Certificate of Purchase in that only 50 per cent of the minerals were reserved to the State.

When the above mistakes in the Certificate of Purchase and Patent were discovered by the Commissioners they had issued a Correction Certificate of Purchase and Correction Patent and, on November 29, 1947, without notice to W. H. Lamascus, reserved all of the minerals to the State in accordance with the prior action of the Commissioners and the published Notice of Sale which constituted the offer to sell to the highest bidder the surface rights only.

June 20, 1949, Phillips commenced this action alleging ownership of an oil and gas lease covering ap undivided one-half interest in the minerals underlying the land, the issuance of Certificate of Purchase to the lessor Lamascus reserving only one-half of the minerals, the issuance of the Correction Certificate of Purchase and the Correction Patent. Phillips alleged that it was a bona fide purchaser and that the Commissioners are estopped from claiming any interest in conflict with the oil and gas lease held by Phillips and prayed that the Correction Certificate of Purchase and Correction Patent be canceled and its title quieted.

The Commissioners filed a Motion to Dismiss on the ground that it was a suit against the State without the express permission of the Legislature. The Motion was overruled as were two demurrers by the Commissioners who then filed a general denial except that they admitted the ac[1196]*1196quisition of the land, the proceeding- of the sale reserving all of the minerals, the error in the issuance of Certificate of Purchase and Patent and their effort to correct these mistakes.

Phillips filed a reply and denied that the Commissioners had authority to reserve more than SO per cent of the minerals. Oral testimony and documentary evidence was introduced. The Court found in favor of Phillips on all issues of law and fact and adjudged it to be the owner of a valid oil and gas lease covering one-half interest in the minerals and canceling the Correction Certificate of Purchase and Correction Patent as clouds upon the title of Phillips in its oil and gas lease. The Commissioners have appealed and submit their argument under six propositions which will be considered in the order submitted.

The Commissioners first contend that their Motion to Dismiss should have been .sustained. It is based upon the theory that this is an action against the State in its sovereign capacity and that such suit cannot be maintained without the express permission. of the Legislature and cites Sections 1, 2,. and 3, of Art. XI of our State .Constitution .wherein the State accepts all grants of land and donations of money made by the United States under the provisions of the Enabling Act and other Acts of Congress, and all monies derived from the sale of such land as a sacred trust for the use and benefit of the common schools of this State as a permanent school fund. Section 2 provides that the principal be deemed a trust fund held by ■the State and that it may be increased, but •shall never be diminished.

■ They cite the case of Board of County Commissioners of Woods County v. State, 125 Okl. 287, 257 P. 778, 781, 53 A.L.R. 1128, wherein this court said:

“We do not think the state was engaged in a private enterprise in loaning the school fund on real estate mortgages for the reason of the mandatory provisions of the Constitution. The state was performing a governmental function, to which it was bound, which it pledged its faith to perform before it came into existence as a state.”

The case of Goodin v. Commissioners of the Land Office, 174 Okl. 364, 50 P.2d 189, 190, was a suit by the holder of a preference right lease on school land and it was alleged that he had been illegally ousted by the Commissioners. He prayed that his rights be restored or for a money judgment in damages in the alternative. In the second syllabus, it was said:

“In the absence of a permissive grant by the Legislature, a party is without authority to maintain an action against the School Land Commission for possession, or, in the alternative, for damages by reason of alleged illegal ouster, as such action is one against the state.”

However, if it be conceded that this action is one against the State in its sovereign capacity, which can only be maintained with the permission of the Legislature, it is pertinent to ask, has such permission been granted? Section 160, 64 O.S.1941, provides in part:

“The Commissioners of the Land Office are hereby authorized and empowered to bring or defend suits in the name and on behalf of the State of Oklahoma in all matters affecting the public lands of the State, and in all matters affecting the loaning, invest-, ing, or collecting of school land and' State, land moneys; of, and belonging to the State * *

The language of the above statute is clear and explicit. There is no need or justification for an interpretation of language so simple and clear. It gives the Commissioners power and authority to “bring or defend” suits “in all matters affecting the public lands of the State * We conclude that the Legislature has given the Commissioners full power and authority to defend this action and to ask for any affirmative relief necessary to enable them to discharge the duties of their trust.

We next consider the alleged error of the Court in holding that the Commissioners have no authority to reserve more than 50 per cent of the minerals.

The Enabling Act provides in sections 9 and 10 that public lands may be appraised and sold “under such rules and [1197]*1197regulations as the Legislature of the said State may prescribe * *

Art.

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Bluebook (online)
1953 OK 395, 258 P.2d 1193, 2 Oil & Gas Rep. 1325, 1953 Okla. LEXIS 477, Counsel Stack Legal Research, https://law.counselstack.com/opinion/state-ex-rel-commissioners-of-land-office-v-phillips-petroleum-co-okla-1953.