Hodgson v. Federal Oil & Development Co.
| Decision Date | 16 December 1922 |
| Docket Number | 1273. |
| Citation | 285 F. 546 |
| Parties | HODGSON v. FEDERAL OIL & DEVELOPMENT CO. et al. |
| Court | U.S. District Court — District of Wyoming |
J. M Hodgson, of Cheyenne, Wyo., and R. R. Stewart, of Washington D.C., for plaintiff.
Harold D. Roberts and Paul P. Prosser, both of Denver, Colo., for defendants.
The above-entitled cause is a suit in equity to impress a trust in the nature of an undivided one-eighth interest upon a certain lease or the benefits accruing therefrom granted by the United States Department of the Interior to the defendant Federal Oil & Development Company.
The bill is attacked by a motion to dismiss, alleging facts insufficient to constitute a cause of action, laches and a bar by the statute of limitations, a final determination of the matters involved by the Department of the Interior, and the failure to join the United States as an indispensable party defendant.
Omitting the formal allegations of the bill designed to give the court jurisdiction, the statement of facts set forth which may be considered as pertinent to the disposition of the motion may be summarized as follows On January 11, 1887, eight natural persons located the O'Glase claim on the S.W. 1/4 of section 13, township 40 range 79, in what is now known as the Salt Creek field, then in the county of Carbon and now in the county of Natrona, in this state and district. The location was made under the placer mining laws, which were afterwards challenged as being ineffective for the location of oil lands, but by legislative enactment subsequently approved and confirmed. The requisite labor and development were performed upon the claim.
Among these eight locators was one George McManus, who subsequently died on the 16th of September, 1901, leaving as his heirs at law a widow, a daughter, and a grandson, who were never residents of the state of Wyoming, with the exception of the grandson, who became a resident a short time before the commencement of this suit, and that these heirs did not know and had no knowledge or information leading to knowledge of the right, title, and interest of the said George McManus in the lands in controversy until the date of the assignment hereinafter mentioned. In February, 1922, these heirs at law assigned all their rights in the property and premises to the plaintiff, who is a resident of this state, and whom the court recognizes as a lawyer admitted to practice in the courts of this state and this court.
On August 21, 1920, the defendant Federal Oil & Development Company filed an application for a lease of the above-described lands as the successor in interest of the locators under the act of February 25, 1920, known as the Mineral Leasing Act (41 Stat. 437). On March 25, 1921, a lease to said defendant was recommended by the Commissioner of the General Land Office, which thereafter and on April 1st was ratified and confirmed by the Secretary of the Interior and issued to said defendant.
The bill alleges erroneous representations on the part of the applicant for the lease and sets out certain findings of the Commissioner and Secretary, and particularly alleges errors of law committed by these officers in awarding the lease to the defendant company.
Among other things the Department of the Interior found that five of the locators in 1886 gave to one Cy Iba a power of attorney to locate lode and placer mining claims in the Rattlesnake mining district in the county of Carbon, territory of Wyoming, which is the mining district in which the claim in controversy was then located, and that in 1884 a similar power of attorney was granted by some of the locators to said Iba and one Fales to do practically the same things. McManus was one of the locators executing the latter power of attorney. These powers of attorney, in addition to granting the right to the attorney to locate claims, gave the right to sell and convey said claims for their principals.
On February 18, 1890, the said Cy Iba made, executed, and delivered a quitclaim deed of an undivided one-half interest in the O'Glase claim to one Victoria A. D. Johnston, and on April 12, 1905, said Iba conveyed an undivided one-half interest in the claim to one Joseph H. Lobell. On February 16, 1907, Victoria A. D. Johnston conveyed her undivided one-half interest to Frederick J. Lobell, who two days later conveyed this interest to Joseph H. Lobell, and who in turn, on August 26, 1915, conveyed the entire claim to the defendant, Federal Oil & Development Company.
The Department then held that the so-called powers of attorney granted to the said Cy Iba were deeds of trust by which Iba was authorized to sell and convey such claims as the O'Glase after same were located, and such deeds of trust were not revocable without the consent of Iba, which consent he did not give to any one, and that it followed that Iba had the authority to convey the legal title to the O'Glase claim, which he did in the manner before specified, all of which was shown by the abstract of title filed with the application, and that the applicant thereby became the holder of the fee title, and, having surrendered the same to the United States, was entitled to the lease which it subsequently received.
It appears that on September 27, 1909, certain lands, including those in controversy, were withdrawn from entry by presidential order which held the title of lands in statu quo until the passage of the leasing act.
Plaintiff alleges that the Department of the Interior Committed an error of law in this respect, that the only power of attorney executed by McManus was the one in 1884, which was a joint power to Iba and Fales, and that, Fales not having joined in any transfer with Iba, the attempted transfers were ineffectual and void in law, which transfers were held valid by the department; and, further, that the records did not show that the O'Glase claim was actually located by either the said Iba or Fales under the power of attorney, but alleges the fact to be that they were located by the locators themselves.
The bill further sets forth the powers of attorney and the deeds executed and delivered by Iba hereinbefore referred to, and that said instruments were duly made matters of record in the county in which the land is located, which as to matters of fact substantially agree with those set forth in the findings of the Department.
Many points of law have been raised under the motion to dismiss by the defendants hereinbefore referred to, some of which are separate and distinct and others of which seem to blend into each other for the purpose of a fair consideration by this court, and they will not, therefore, be given separate consideration in this memorandum.
One of the chief points of contention between counsel presented in the argument and in the exhaustive briefs filed was as to whether or not the grantees and their successors under the Iba deeds ever acquired a title which was adverse to McManus, his heirs and their assignee.
It is the earnest contention of counsel for the plaintiff that McManus being a cotenant with other locators and the defendant through Iba and his grantees being claimants under a conveyance, shown upon its face to be invalid in that it was insufficient to transfer the legal title of McManus, that neither the defendant nor its grantors could ever acquire an adverse title, and that in effect the cotenants and their grantors occupied a position of trust toward McManus out of which an adverse title never would accrue.
On the other hand, counsel for defendants maintain with equal earnestness that this rule in regard to cotenancy and such trust relationship is not inflexible, but varies according to the circumstances in each case, and in short that an adverse title begins from the date of the instrument which purports to convey the entire estate of all the cotenants, even though in the first instance such conveyance in its strict and legal effect may not have been sufficient; in other words, that any conveyance purporting to grant away the entire title creates such a color of title as may eventually emerge in the form of an adverse title in the grantee.
There are authorities tending to sustain both contentions. After a careful examination of these authorities, this court is of the opinion that the rule is not inflexible, and that an adverse title as between cotenants may be established, depending upon the individual circumstances of the case at hand. One of the controlling features in this instance seems to be what the instrument itself relied upon purports to convey. In the case of Elder v. McClaskey, 70 F. 529, 17 C.C.A. 251, Judge Taft, then Circuit Judge, says:
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