Hodgson v. Federal Oil Development Co 24 25, 1927

• Decision Date: 11 April 1927
• Docket Number: No. 166,166
• Citation: 47 S.Ct. 502,274 U.S. 15,71 L.Ed. 901
• Parties: HODGSON v. FEDERAL OIL & DEVELOPMENT CO. et al. Argued Feb. 24-25, 1927
• Court: U.S. Supreme Court

274 U.S. 15

47 S.Ct. 502

71 L.Ed. 901

HODGSON

v FEDERAL OIL & DEVELOPMENT CO. et al.

No. 166.

Argued Feb. 24-25, 1927.

Decided April 11, 1927.

Messrs. James M. Hodgson and Floyd E. Pendell, both of Denver, Colo., for appellant.

Messrs. Harold D. Roberts, of Denver, Colo., Tyson S. Dynes, of Chicago, Ill., and Peter H. Holme, of Denver, Colo., for appellees.

Mr. Justice McREYNOLDS delivered the opinion of the Court.

Appellant seeks to establish his right to a one-eighth interest in an oil and gas lease upon 160 acres of land in Wyoming granted August 21, 1920, by the United States to appellee Federal Oil & Development Company under section 18, Act of Congress approved February 25, 1920, c. 85, 41 Stat. 437, 443 (Comp. St. § 4640 1/4 i). The lease was afterwards assigned to the Mountain & Gulf Oil Company upon conditions not here important.

The bill, filed May 26, 1922, proceeds upon the theory:

That January 11, 1887, George McManus and seven associates located a placer mining claim-the O'Glase-and thereafter perfected the same. McManus died in 1901. His one-eighth interest descended to his heirs and has never been forfeited, abandoned, or lost. These heirs lived beyond Wyoming and were unaware of their interest in the claim for 20 years. The land is within the district withdrawn from entry by executive order of September 27, 1909. The Federal Oil & Development Company, having become part owner of the claim, took possession, and thereafter, asserting ownership to the whole, surrendered the same and procured the existing lease in its own name under the Act of 1920. The company became a cotenant with the McManus heirs, and consequently the lease ob- tained by it inured to their benefit. Appellant purchased their interest February 11, 1922, and may now impress a trust upon the lease.

The trial court held that no adequate ground for relief was disclosed, and dismissed the bill upon motion. This was affirmed by the Circuit Court of Appeals. 5 F.(2d) 442.

A motion to amend the bill, first made in this court, must be overruled. It does not appear that the alleged facts have been recently discovered and there is no affidavit in respect of them.

The Act of February 25, 1920, provides:

'Sec. 18. That upon relinquishment to the United States, filed in the General Land Office within six months after the approval of this act, of all right, title, and interest claimed and possessed prior to July 3, 1910, and continuously since by the claimant or his predecessor in interest under the pre-existing placer mining law to any oil or gas bearing land * * * embraced in the executive order of withdrawal issued September 27, 1909, and not within any naval petroleum reserve, and upon payment as royalty to the United States of an amount equal to the value at the time of production of one-eighth of all the oil or gas already produced * * * the claimant, or his successor, if in possession of such land, undisputed by any other claimant prior to July 1, 1919, shall be entitled to a lease thereon from the United States for a period of twenty years, at a royalty of not less than 12 1/2 per centum of all the oil or gas produced. * * *

'All such leases shall be made and the amount of royalty to be paid for oil and gas produced, except oil or gas used for production purposes on the claim, or unavoidably lost, after the execution of such lease shall be fixed by the Secretary of the Interior under appropriate rules and regulations. * * * In case of conflicting claimants for leases under this section, the Secretary of the Interior is authorized to grant leases to one or more of them as shall be be deemed just. All leases hereunder shall inure to the benefit of the claimant and all persons claiming through or under him by lease, contract, or otherwise, as their interests may appear. * * *

'Sec. 32. That the Secretary of the Interior is authorized to prescribe necessary and proper rules and regulations and to do any and all things necessary to carry out and accomplish the purposes of this act. * * *' Comp. St. §§ 4640 1/4 i, 4640 1/4 pp.

The following is one of the regulations established by the Secretary:

'24 1/2. All proper parties to a claim for relief under sections 18, 19, or 22 of the act should join in the application, but, if for any sufficient reason that is impracticable, any person claiming a fractional or undivided interest in such claim may make application for a lease or permit, stating the nature and extent of his interest, and the reasons for nonjoinder of his co-owner or co-owners. In cases where two or more applications are made for the same claim or part of a claim, leases or permits will be granted to one or more of the claimants, as the law and facts shall warrant and as shall be deemed just.'

Appellant insists that he is entitled to relief under the clause in the Act of 1920 which provides:

'All leases hereunder shall inure to the benefit of the claimant and all persons claiming through or under him by lease, contract, or otherwise, as their interests may appear.'

But we think it is clear enough that he does not claim 'through or under' either appellee, within the...