Leuthold v. Brandjord

• Decision Date: 31 May 1935
• Docket Number: 7429.
• Parties: LEUTHOLD v. BRANDJORD, Commissioner of State Lands and Investments, et al.
• Court: Montana Supreme Court

47 P.2d 41

100 Mont. 96

LEUTHOLD v. BRANDJORD, Commissioner of State Lands and Investments, et al.

No. 7429.

Supreme Court of Montana

May 31, 1935

Original mandamus proceeding by John H. Leuthold against I. M Brandjord, Commissioner of State Lands and Investments, and the State Board of Land Commissioners.

Writ of mandate issued.

A. J Galen and L. L. Callaway, both of Helena, for plaintiff.

Raymond T. Nagle, Atty. Gen., and Oscar A. Provost, Asst. Atty. Gen for defendants.

MATTHEWS Justice.

John H. Leuthold, a citizen and resident taxpayer of, and who has been engaged in raising live stock in, Montana for more than 25 years past, and who on December 9, 1933, was issued a lease on certain state grazing lands with the expiration date fixed at February 28, 1935, instituted this special proceeding for a writ of mandate to compel I. M. Brandjord, commissioner of state lands and investments, and the state land board, to extend the term of his lease for an additional three years from the date of expiration, in conformity with the provisions of chapter 61, Laws of 1935.

The plaintiff's petition shows that prior to 1933 it was the universal practice of the land department to issue all such leases for the full term of five years. From 1927 to 1933, the maximum annual rental on state grazing lands was $100 per section, "except where the leasing price is increased above this sum by competitive bidding." Section 25, c. 60, Laws 1927.

The Legislative Assembly of 1933, in view of the depression and the uncertainty of profitably conducting the live stock business, and, perhaps, the uncertainty of securing leasers at the leasing price then in effect, reduced the rates 50 per cent. Chapter 42, § 3, Laws 1933. After this act became effective, Leuthold and other stockmen made application for the customary 5-year leases at the new leasing price in the absence of competitive bidding. The defendant commissioner denied these applications, and issued to Leuthold and many others in like situation, leases expiring on February 28, 1935, although during the same year many leases of state lands were executed for the full 5-year period. It is alleged that this action constituted a discrimination against the plaintiff and those in like situation, and that the live stock business cannot be successfully conducted on lands leased for a short term.

With this situation presented, the Legislative Assembly of 1935 enacted chapter 61, Laws 1935, which declares: "That all leases of state lands for grazing purposes issued *** for a period of two years or less, terminating on the 28th day of February, 1935, pursuant to the provisions of Chapter 42 *** shall, at the option of lessees in good standing, be extended for an additional period of three years from and after February 28, 1935, so as to give to such lessees the same privileges, benefits, and advantages as are under authority of law conferred upon persons holding leases of such lands for a five-year period." Section 1. Section 2 of the act requires the "Registrar of State Lands" to give notice by registered mail to each lessee entitled to the benefits of the act of his "preference right to have the lease of the state lands by him so held extended *** so as to place him on a basis of equality with those holding similar leases *** for a five-year period."

It is alleged that the defendant commissioner failed and refused to comply with the provisions of section 2, above, but nevertheless this plaintiff, pursuant to the provisions of the act, and before the expiration of his short-term lease, to wit, on February 13, 1935, made formal application for an extension thereof, and accompanied his application by a remittance of the next two years' rental in advance. This application was rejected on the advice of the Attorney General that the act was unconstitutional, and the plaintiff notified that the leasing of the lands in question would be put up for open competitive bidding, but that the plaintiff would have "preference rights" in releasing such lands. The plaintiff notified the officials that he protested such action and would stand on his rights under the Act of 1935.

It is alleged that a re-leasing of these lands would greatly decrease the value of the lease, as all leases issued subsequent to February 28, 1935, contain the provision, not included in former leases, that "the right is hereby reserved by the state to cancel and terminate this lease at the end of any rental year in case the state desires to exchange the land with the United States or lease it to a State Cooperative Grazing Association."

On the petition filed, an alternative writ of mandate was issued out of this court, and, on behalf of the defendants, the Attorney General filed a motion to quash on the ground that neither the petition nor the writ, nor both together, state facts sufficient to entitle the plaintiff to the relief sought, or to any relief.

The Attorney General filed no brief herein for the reason that on the day Leuthold's petition was filed, one C. H. Rathbone instituted a proceeding to enjoin the defendants here from proceeding under chapter 61, Laws 1935, on the ground that the act was unconstitutional. In each proceeding the Montana Stock-growers Association and the Montana Woolgrowers Association appeared by counsel, who submitted briefs as amici curiae. The two matters were heard as one, and the divergent views on the subject fully expounded. Plaintiff's brief in the Rathbone proceeding will be taken and considered as the brief of the defendants here on their motion to quash the alternative writ, and in support of their contention that the act in question is unconstitutional.

In this proceeding questions of law are alone presented, and they are all based upon the alleged conflict of the Act of 1935 with specific constitutional provisions.

As we understand the position of the defendants here, wherein no rights of other applicants to lease this particular land are involved, and no question as to any opportunity to increase the annual rental by putting the lease up for competitive bidding is raised, it is asserted that the act is invalid by reason of being in conflict with the following constitutional provisions:

(1) That it violates the prohibition against the enactment of local or special laws (section 26, art. 5), and the specific provision that no state lands "nor any estate or interest therein, shall ever be disposed of except in pursuance of general laws providing for such disposition." Section 1, art. 17.

(2) That it constitutes a delegation of legislative power to an individual in giving the lessee the option to have his lease extended, in violation of section 1, art. 5.

(3) That it violates section 4, art. 11, in that it seeks to deprive the state land board of its constitutional right to manage and control the state lands.

(4) That it was passed for the benefit of individuals and imposes upon the people a new liability in respect to transactions or considerations already passed, and is retroactive in nature, in violation of section 13 of article 15, and, possibly (5), the Fourteenth Amendment to the Federal Constitution.

A determination of the questions thus presented requires a review, to some extent, of the history of our state lands and the laws enacted with respect thereto.

By the Act of Congress (Feb. 22, 1889, 25 Stat. 676) providing for the admission of Montana into the Union, the state was required to make provision for the establishment and maintenance of a system of public schools open to all children of the state (section 4), and there was granted to the state for educational purposes, sections 16 and 36 of each township, with certain exceptions (section 10), and other lands for the support of the various higher educational institutions (sections 14 and 17), and further lands for capitol building purposes (section 12). Therein it is provided that "all lands herein granted for educational purposes *** may, under such regulations as the legislatures shall prescribe, be leased for periods of not more than five years." Sections 11 and 14, Act of February 22, 1889, 25 Stat. 676. The terms of these grants were accepted by the state. Const. § 7, Ordinance 1; State ex rel. Galen v. District Court, 42 Mont. 105, 112 P. 706. The foregoing act was amended in 1932, in particulars not important here, and therein the provision for leasing grazing lands for a period of not more than five years "under such regulations as the legislature may prescribe" was reiterated. The amendment was accepted by the state. Chapter 84, Laws 1933.

Our Constitution (article 17) declares: "Section 1. All lands of the state that have been, or that may hereafter be granted to the state by congress, and all lands acquired by gift or grant or devise, from any person or corporation, shall be public lands of the state, and shall be held in trust for the people, *** and none of such land, nor any estate or interest therein, shall ever be disposed of except in pursuance of general laws providing for such disposition, nor unless the full market value of the estate or interest disposed of, to be ascertained in such manner as may be provided by law, be paid or safely secured to the state. *** Said lands shall be classified by the board of land commissioners, as follows: First, lands which are valuable only for grazing purposes," etc. "Sec. 2. The lands of the first of said classes may be sold or leased, under such rules and regulations as may be prescribed by law. ***"

"The governor, superintendent of public instruction, secretary of state and attorney general" constitute the state board of land commissioners, and it has "the direction control, leasing and sale" of these lands "under such regulations and...