United States v. McKenzie County

187 F. Supp. 470, 13 Oil & Gas Rep. 475, 1960 U.S. Dist. LEXIS 5105
CourtDistrict Court, D. North Dakota
DecidedSeptember 30, 1960
DocketCiv. No. 271
StatusPublished
Cited by7 cases

This text of 187 F. Supp. 470 (United States v. McKenzie County) is published on Counsel Stack Legal Research, covering District Court, D. North Dakota primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
United States v. McKenzie County, 187 F. Supp. 470, 13 Oil & Gas Rep. 475, 1960 U.S. Dist. LEXIS 5105 (D.N.D. 1960).

Opinion

REGISTER, Chief Judge.

This is an action to quiet title and to determine adverse claims to the following described lands situated in the County of McKenzie, State of North Dakota:

The North Half of the Southwest Quarter (N y2 SW %), Southeast Quarter of the Southwest Quarter (SE % SW %) and the Northwest Quarter of the Southeast Quarter (NW 1/4 SE %) of Section 5, and the Southwest Quarter of the Northeast Quarter (SW % NE %), Northeast Quarter of the Northwest Quarter (NE % NW %) and the South Half of the Northwest Quarter (S % NW %) of Section 8, all in Township 153 North, Range 95 West of the Fifth Principal Meridian.

Plaintiff’s complaint is in the North Dakota statutory form and alleges, among other things, that the plaintiff is the owner in fee simple absolute and in possession of said lands, subject to a valid and subsisting oil and gas lease held by the defendant, The Texas Company.

The defendants Ivan Murray and John F. Mullaney have filed answers conceding that the plaintiff is the owner of the surface and one-half of the mineral rights underlying said lands, and both allege that at the time of the execution and delivery of the deed to the United States from Ivan Murray, said grantor was the owner of all of the minerals of whatever kind or nature underlying said lands and that the defendant John F. Mullaney was the owner of 35 mineral acres by reason of a certain mineral conveyance by said Ivan Murray to him. The defendant Mullaney also includes in his answer a counterclaim alleging that he is the owner of 35 mineral acres of the minerals in said lands, which claim the plaintiff has denied by its reply. Defendant Murray contends that he is at present the owner of one-half of all the minerals underlying said lands, subject to conveyance to said Mullaney.

Both of the answering defendants allege that the Secretary of the Interior duly instructed the Legal Division of the Department of the Interior to make a determination of the mineral interests in said lands owned by the United States; that pursuant to said instructions said Department, through the Bureau of Land Management, gave due notice to all parties having an interest in said minerals; that a hearing was held and a departmental decision made on November 4, 1955; that a further review was subsequently made, of which all parties in interest were duly notified; that thereafter, and on the 30th day of April, 1956, said Department rendered its decision determining the extent of the plaintiff’s mineral interest, and that no appeal was ever taken from said decision to the Secretary of the Interior; and that said de[472]*472termination is final and conclusive of all matters at issue here and that, therefore, the same are res judicata, and that the United States is estopped to question the title of the answering defendants because of said departmental determination.

The pertinent facts are undisputed and are as follows: The lands here involved were originally patented under homestead entry, Williston 020931, to Emily Garland, on April 29, 1919, granting her fee title subject only to a reservation of eoal to the United States under the Act of June 22, 1910, 30 U.S.C.A. § 85. Through mesne conveyances title was recorded in J. Y. Hull on May 28,1925. On December 11, 1928, the land was sold pursuant to tax forfeiture proceedings of the State of North Dakota for taxes assessed for the year 1927, and McKenzie County became the successful bidder and received a tax deed for said lands on October 1, 1940. On May 4, 1948, McKenzie County granted an oil and gas lease to Thomas G. Dorough for a primary term of ten years, which lease was assigned by him to The Texas Company on October 25, 1948. McKenzie County, on May 3, 1949, conveyed said lands to defendant Ivan Murray; the deed of conveyance recited that the transfer was made subject to the provisions of Chapter 136, Laws of North Dakota, 1941, reserving to the County (grantor) fifty per cent of all oil, gas and minerals that may be found underlying said lands.

Defendant Murray brought a suit to quiet the title to said lands and obtained a judgment in the District Court for the Fifth Judicial District, State of North Dakota, on September 8, 1949.

By warranty deed dated February 2, 1951, defendant Murray conveyed said lands to the United States, pursuant to a land exchange under Title III of the Bankhead-Jones Farm Tenant Act, 7 U.S. C-A. § 1010 et seq., the negotiations for which were conducted by the Soil Conservation Service. The deed from Murray to the United States contained the following provisions, immediately following the description in the granting clause:

“subject to the following reservations and exceptions:
“The rights of the United States and third parties recited in the patent from the United States.
“Existing public utility easements.
“Right-of-way easements for roads and highways granted, created or established by or for the use of the public and by or under local, State or Federal laws or decisions, or otherwise, prior to the conveyance of title to the United States.
“Except 50% of all oil, gas or minerals upon or underlying said land, received by McKenzie County, North Dakota, under the provisions of Ch. 136, Laws of North Dakota, 1941, in its county deed to Ivan Murray, dated May 3, 1949 and recorded in the office of the Register of Deeds of McKenzie County, North Dakota, in Book ‘54’ of Deeds, Page 505.”

A default judgment was obtained by defendant Murray on February 13, 1954, in the District Court, Fifth Judicial District, State of North Dakota, in an action entitled “Ivan Murray v. McKenzie County, a municipal corporation organized and existing under and by virtue of the laws of North Dakota”, quieting his title against McKenzie County. This judgment was amended on March 4,1954, decreeing the defendant Murray to be the owner of an undivided one-half interest in all minerals under the subject lands.

By decisions of the Supreme Court of North Dakota, rendered on March 21, 1951, statutory reservations in favor of counties of 50 per cent of mineral interests in lands acquired through tax forfeiture proceedings, which lands were subsequently sold, were declared void. Kopplin et al. v. Burleigh County, 77 N.D. 942, 47 N.W.2d 137; Kershaw v. Burleigh County, 77 N.D. 932, 47 N.W.2d 132. The decisions of the Supreme Court of North Dakota in these two cases were subsequently adhered to in [473]*473the case of State et al. v. California Co. et al., 1953, 79 N.D. 430, 56 N.W.2d 762.

On July 1, 1954, the Bureau of Land Management, being unaware of the existence of The Texas Company lease, granted an oil and gas lease on subject lands in Section 5 to E. B. McFadden. Said lease covered 100 per cent of the oil and gas under said lands. On February 1, 1954, a similar lease was granted, under the same circumstances, to Halvor Hol-beck, on the subject lands in Section 8.

The Texas Company, in August, 1954, filed identical protests to the McFadden and Holbeck leases, protesting issuance of these leases on the ground that it claimed the operating rights under its 1948 lease from McKenzie County.

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Bluebook (online)
187 F. Supp. 470, 13 Oil & Gas Rep. 475, 1960 U.S. Dist. LEXIS 5105, Counsel Stack Legal Research, https://law.counselstack.com/opinion/united-states-v-mckenzie-county-ndd-1960.