McCarthy v. Coos Head Timber Co.
| Citation | 302 P.2d 238,208 Or. 371 |
| Parties | Richard Clark McCARTHY, Annabell McCarthy, John Dennis McCarthy, and Betty J. McCarthy, Respondents, v. COOS HEAD TIMBER COMPANY, a Corporation, Appellant, State or Oregon, Acting by and through Elmo E. Smith, Governor, substituted for Paul L. Patterson Earl T. Newbry, Secretary of State, and Sig Unander, State Treasurer, constituting the State Land Board, Appellant. John Edmund HONGELL and Thelma E. Hongell, Respondents, v. COOS HEAD TIMBER COMPANY, a Corporation, Appellant, State of Oregon, Acting by the through Elmo E. Smith, Governor, substituted for Paul L. Patterson, Earl T. Newbry, Secretary of State, and Sig Unander, State Treasurer, constituting the State Land Board, Appellant. |
| Decision Date | 03 October 1956 |
| Court | Supreme Court of Oregon |
Lloyd Hammel, Asst. Atty. Gen. for Oregon, for appellant State. On the brief was Robert Y. Thornton, Atty. Gen. for Oregon.
Curtis Cutsforth, Portland, for respondents. With him on the brief were King, Miller, Anderson, Nash & Yerke, Ralph H. King and Fredric A. Yerke, Jr., Portland.
Joseph McKeown, Coos Bay, for appellant Coos Head Timber Co. With him on the brief were McKeown, Newhouse & Johansen, Coos Bay.
Before WARNER, C. J., and TOOZE, ROSSMAN, LUSK, BRAND and PERRY, JJ.
In this case two suits have been consolidated for trial in the circuit court and on this appeal. We shall refer to the first suit as the McCarthy case and to the second suit as the Hongell case. In both cases the Coos Head Timber Company, a corporation, is the defendant and in both cases the State of Oregon, acting by the through the State Land Board, has filed a complaint in intervention as a defendant. The McCarthy complaint and the Hongell complaint are identical except for the names of the plaintiffs and the descriptions of the respective properties, and the evidence upon the merits is substantially the same in both cases. The suits were brought by the plaintiffs as upland owners whose properties front on Catching Slough, a tidal estuary, Because the uplands front upon tide lands and are suitable for the storing and mooring of boom logs, the plaintiffs have rented the shores of the properties for the purpose of booming logs and have derived substantial incomes therefrom. For a number of years prior to October 1, 1950 the waters adjacent and bordering upon the described uplands have been occupied by logs in boom stored by the lessee of the respective plaintiffs. In October, 1950, the State Land Board of Oregon executed an instrument entitled 'Tideland Lease' whereby it purported to lease to the Coos Head Timber Company for the period of 10 years from October 24, 1950, all tide and overflow land between mean high water and mean low water lines fronting and abutting upon the lands described therein. The tide lands thus described had a total frontage of approximately eight miles, which included the frontage belonging to the McCarthys and the Hongells, plus the frontage of other persons. The plaintiffs attack the validity of the defendant's lease as violative of the preference right given them by statute to lease the tide lands fronting upon their properties at the highest price offered in good faith. They seek decrees adjudging it to be void as to the tide lands which abut upon their uplands which are described in the respective complaints. The plaintiffs also pray that if the court should find that the defendant had acquired a lease upon the lands fronting upon the real property of the plaintiffs that then the plaintiffs have a decree to the effect that the defendant holds said portions of the lease as trustee for the plaintiffs and directing that the defendant assign and set over to the plaintiffs the portion of the lease relating to said lands, and in the event that the defendant neglects to execute such assignment, then for an order that the decree of the court shall stand and operate as an assignment thereof. The issues are adequately raised by the pleadings and the essential facts are undisputed. The cases were tried on the merits and the court entered a decree in each case to the effect that the tide lands fronting upon the property of the plaintiffs were held by the defendant company as trustee for the plaintiffs and that the decree should operate as an assignment to the plaintiffs in each case of the leased tide lands fronting upon their uplands. Each decree also enjoined the defendant Coos Head Timber Company from interfering with the use and occupancy by the plaintiffs of the tide lands abutting upon their property. The defendant company and the State of Oregon appeal.
The decision of this case depends upon the construction and application to the facts proven of O.C.L.A. § 106-312, which in its revised form without change of substance, appears as ORS 274.040. As revised, the statute reads as follows:
ORS 274.040.
On 26 July 1950 the defendant company wrote to the State Land Board stating their desire to secure a 10-year lease to certain tide lands on Catching Slough. On 29 July the State Land Board sent to the defendant company application forms. Ensuing correspondence related to the description of lands available for lease. On 14 August the defendant company made application to the State Land Board to lease the tide lands described therein which included the tide lands fronting upon the uplands of the plaintiffs, and on 5 September the records of the State Land Board show that 'The application of Coos Head Timber Company, of Coos Bay, Oregon to lease approximately eight miles of tide and overflow lands on Catching Slough * * * was presented * * *.' The State Land Board authorized advertisement of the subject lands for lease for a period of 10 years at a minimum annual rental of $1,000. On 8 September the Board notified the Coos Head Timber Company of its action and enclosed notices in triplicate with instructions that they be published as therein specified. Thereafter the following notice to bidders was published:
'Notice to Bidders
'Notice is hereby given that the Oregon State Land Board will receive sealed bids at its office in the State Capitol, Salem, Oregon, up to 10:00 o'clock A. M. on Tuesday, October 24, 1950, for the leasing of tide and overflow land, which land is described hereinafter, giving, however, to the owner or owners of any land abutting thereon, for a period of 48 hours after the opening of said bids, the preference right to lease said overflow land at the highest price offered, provided such offer is made in good faith, and provided the Land Board reserves the right to reject any and all bids.
'Said tide and overflow land is in Coos County, Oregon, and is described as follows:
'All tide and overflow land between mean high water and mean low water lines fronting and abutting the following described land:
[Here follows a description of the lands.]
'Bids must be accompanied by a certified or casher's check or postal money order for the full amount of the first year's rental, and no bids will be considered for less than $1000.00 per annum, lease to be for a minimum period of 10 years. In addition to the amount bid, the successful bidder shall pay the cost of advertising. All bids should be sealed and addressed to E. T. Pierce, Clerk, State Land Board, Salem, Oregon, and marked 'Bid to lease tide and overflow land.'
'Dated at Salem, Oregon, this 8th day of September, 1950.
'E. T. Pierce,
'Clerk, State Land Board.
'Date of first publication, September 21, 1950.
'Date of final publication, October 19, 1950.' (Italics ours.)
The notice to bidders was advertised in compliance with the provisions of ORS 274.040, supra, one notice being published for the required time in a paper published in Waldport, Lincoln County, and the other being published for the required time in a paper published in Myrtle Point, Coos County, Oregon.
On 19 October 1950 the defendant company executed and thereafter presented to the State Land Board its bid for the leasing of the overflow lands described in the notice to bidders. The provisions of the bid with which we are concerned were the payment of $1,000 rental per annum for a 10-year lease. On 24 October the State Land Board met and considered the application of the defendant company. The minutes of the meeting show that the clerk reported that advertisement of the subject lands for lease for a period of 10 years at a minimum annual rental of $1,000 had been completed. The records further show that the clerk then presented the only bid received in response to said advertisement, namely, the bid of the defendant company. The minutes then recite:
'Upon consideration of said bid and the recommendation of the clerk, the board authorized execution and delivery of lease in conformity therewith, subject to the riparian rights provided by statute.' (Italics ours.)
On 30 October the State Land Board executed a lease to the defendant company in consideration of $10,000 which was to be paid in annual instalments of $1,000 covering the tide and overflow land described in the notice to bidders.
The defendants rely solely upon the sufficiency of the published notice to bidders and no notice was sent to any of the plaintiffs concerning the proposed leasing or concerning any preference right. The plaintiffs were not aware of any proceedings looking to the lease of October 30 nor of the execution...
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