Fawn Lake Ranch Co. v. Cumbow
| Decision Date | 16 March 1918 |
| Docket Number | 20436 |
| Citation | 167 N.W. 75,102 Neb. 288 |
| Parties | FAWN LAKE RANCH COMPANY, APPELLANT, v. F. A. CUMBOW ET AL., APPELLEES |
| Court | Nebraska Supreme Court |
APPEAL from the district court for Cherry county: WILLIAM H WESTOVER, JUDGE. Reversed.
REVERSED.
Walcott & Walcott and Hainer, Craft & Lane, for appellant.
John J Sullivan, J. J. Harrington, J. C. Quigley, Willis E. Reed Attorney General, and George W. Ayres, contra.
John M. Macfarland and Howell M. Uttley, amici curiae.
The plaintiff avers that it is in possession as lessor of section 16, township 29, range 39, by virtue of certain leases executed by the state of Nebraska; that defendant trespassed thereupon, and threatens to sink a pipe line and extract mineral from a lake thereupon; that the lease does not expire until 1925. The prayer is for an injunction to prevent the trespass and the removal of any mineral water from the lake.
The land is held under three leases which are set forth as exhibits to the petition. Each of the leases is executed by the then public commissioner of lands and buildings. It recites it is issued "in pursuance and by virtue of the power and authority vested in me by the state of Nebraska." It provides, among other things, that the lessor will pay semi-annually in advance 6 per cent. upon the appraised value of the lands, and "that he will not commit any waste or spoil in or upon said lands." The answer admits that defendant intends to enter upon the land for the sole purpose of extracting potash and other minerals from the water of the lake and to convert the same to his own use; alleges that he duly leased the land from the state of Nebraska for the purpose of prospecting for minerals, gas, petroleum, potash, and other valuable substances; that the plaintiff's lease is an agricultural lease solely; that plaintiff has no right by virtue of said lease to take any minerals; that the rent paid by plaintiff is upon the appraised value for agricultural purposes; that there is no open mine on the land, and none has ever been upon it or operated thereon; that the doing of anything which the defendant proposes to do will not diminish the value of plaintiff's lease; that the mineral waters and minerals are of no value for stock-raising purposes; that the land has no value except for grazing; that unless plaintiff is restrained and enjoined he will prevent defendant and his employees from laying pipe lines or extracting mineral potash, which is of high value at the present time on account of the war, and which could not successfully be extracted with profit in ordinary times; and that, if prevented from extracting the minerals, it will be of great injury and damage to himself and to the state of Nebraska. He prays for an injunction to prevent plaintiff from interfering with his rights in the premises. A copy of the lease mentioned is attached.
The substance of the lease is that the commissioner of public lands and buildings has leased and granted the right to defendant, his heirs or assigns, "to enter upon and occupy the premises as herein below described, for the purpose of prospecting for minerals, petroleum, gas, potash, or other valuable substances, and for producing the same to excavate, drill wells, lay pipe lines, erect necessary buildings, tanks or structures, to release or subdivide the premises described." The lease is to extend for a term of three years, and as long thereafter as minerals are produced in paying quantities and the rental terms are complied with. The lessor agrees to pay one-eighth part of all minerals, petroleum, gas, potash, or other valuable material, or at the option of the state to pay into the proper fund of the state the market value thereof in cash. The lessor agrees to commence the analysis of the chemicals within six months, the actual construction of buildings or structures, or the beginning of excavations, boring, or drilling within one year, and for a complete test within three years from the execution of the lease, and he shall have the right at any time on the payment of $ 1 to the lessor to surrender the lease for cancelation.
The state of Nebraska filed a petition of intervention, setting forth that plaintiff's lease was for agricultural and grazing purposes only; that the defendant will only occupy a small portion of the land; that it is willing to deduct a reasonable amount from the rent for damage to the plaintiff on account of the occupation; that potash is now very valuable, and at the close of the war it may be greatly reduced. It joins with defendant in asking for an injunction.
The court found for defendant and intervener, and enjoined plaintiff from interfering with the use or possession of the premises by the defendant for the purpose stated.
LETTON, J. MORRISSEY, C. J., took no part in this decision.
It was conceded at the argument that the owner of land holds from the center of earth to the sky, and that he may subdivide his estate laterally, conveying the right to the surface only to one individual, and reserving the right to the minerals to himself with power of disposal. It is also conceded that, even without an express reservation in a conveyance of the surface, the grantor impliedly reserves a right to so much of the surface as is necessary for mining operations, or for the purpose of reducing the subsurface estate to possession. These concessions, which seem to state the settled law (27 Cyc. 688; Marvin v. Brewster Iron Mining Co., 55 N.Y. 538, 14 Am. Rep. 322; Kemmerer v. Midland Oil & Drilling Co., 229 F. 872; Chartiers Block Coal Co. v. Mellon, 152 Pa. 286, 25 A. 597; Porter v. Mack Mfg. Co., 65 W.Va. 636, 64 S.E. 853) materially narrow the matters in controversy in this case. Two points alone are left to determine: (1) Was the lease to plaintiff solely an agricultural lease which gave no right to remove minerals? If this point be decided in favor of defendant's contention, (2) has the board of educational lands and funds, without express legislative sanction, power to convey to him the right to enter upon and remove minerals from the lands already leased to plaintiff?
1. The lease to plaintiff is not by its terms an agricultural lease; in other words, the plaintiff has the right to use the premises for any purpose which he desires as long as he does not commit waste or spoliation. Has plaintiff the right to extract and remove the mineral from the land or from the waters standing upon it? 1 Washburn, Real Property (4th ed.) 108, defines waste as follows: "Waste, in short, may be defined to be whatever does a lasting damage to the freehold or inheritance, and tends to the permanent loss of the owner in fee, or to destroy or lessen the value of the inheritance." Any act which tends to diminish the estate and cause a permanent loss to the owner of the fee constitutes waste. United States Fidelity & Guaranty Co. v. Rieck, 76 Neb. 300, 107 N.W. 389. There can be no question that the opening of a new mine or quarry upon leased premises, the taking of rock or minerals, or sand, or gravel, or oil therefrom, is waste under these definitions. To remove potash is as clearly waste as would be the removal of the other substances mentioned. Plaintiff therefore has no right to the mineral.
The land in question forms part of that granted to the state by the United States in the enabling act "for the support of common schools." The only provision in the Constitution of 1866 with reference to school lands is as follows: "The university lands, school lands, and all other lands which have been acquired by the territory of Nebraska or which may hereafter be acquired by the state of Nebraska for educational or school purposes, shall not be aliened or sold for a less sum than five dollars per acre." When the state was admitted to the Union and the grant became effective, the legislature, under the Constitution of 1866, made the auditor of state land commissioner, for the purpose of selling and leasing school lands, and by statute he was authorized to dispose of them by sale or lease in the manner prescribed in the act (Gen. St 1873, ch. 70). In 1875 the present Constitution was adopted. Article VIII relates to education. Section 1 of this article is as follows: "The governor, secretary of state, treasurer, attorney general, and commissioner of public lands and buildings shall, under the direction of the legislature, constitute a board of commissioners, for the sale, leasing, and general management of all lands and funds set apart for educational purposes, and for the investment of school funds, in such manner as may be prescribed by law." The first session of the legislature after the adoption of this Constitution passed an act (Laws 1877, p. 174) "to provide for the registry, sale, leasing and general management of all lands and funds set apart for educational purposes, and for the investment of funds arising from the sale of such lands." This act provided with much detail the manner in which the sale or lease of school lands should be made. In 1897 an act was passed which prohibited the further sale of school lands except in certain specified instances mentioned in the act. Laws 1897, ch. 71. In 1899 a new and general act was passed covering the whole subject of the disposal of school lands and providing that "none of the educational lands may hereafter be sold except for school, church, or cemetery purposes as hereinafter provided." Laws 1899, ch. 69. Section 1 of this act provides that the board shall cause the educational lands "to be registered, leased and sold...
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