Natural Gas & Oil Corp. v. Waggonner

• Decision Date: 07 February 1963
• Docket Number: Nos. 9888,9889 and 9890,s. 9888
• Citation: 151 So.2d 575
• Court: Court of Appeal of Louisiana — District of US
• Parties: NATURAL GAS AND OIL CORPORATION, Plaintiff-Appellant, v. W. E. WAGGONNER, Sheriff and Ex-Officio Tax Collector of Bossier Parish, Defendant-Appellee. MISSISSIPPI RIVER FUEL CORPORATION, Plaintiff-Appellant, v. W. E. WAGGONNER, Sheriff and Ex-Officio Tax Collector of Bossier Parish, Defendant-Appellee. HUMBLE PIPE LINE COMPANY, Plaintiff-Appellant, v. W. E. WAGGONNER, Sheriff and Ex-Officio Tax Collector of Bossier Parish, Defendant-Appellee.

Page 575

151 So.2d 575

NATURAL GAS AND OIL CORPORATION, Plaintiff-Appellant, v. W. E. WAGGONNER, Sheriff and Ex-Officio Tax Collector of

Bossier Parish, Defendant-Appellee.

MISSISSIPPI RIVER FUEL CORPORATION, Plaintiff-Appellant, v. W. E. WAGGONNER, Sheriff and Ex-Officio Tax Collector of

Bossier Parish, Defendant-Appellee.

HUMBLE PIPE LINE COMPANY, Plaintiff-Appellant, v. W. E. WAGGONNER, Sheriff and Ex-Officio Tax Collector of

Bossier Parish, Defendant-Appellee.

Nos. 9888, 9889 and 9890.

Court of Appeal of Louisiana, Second Circuit.

Feb. 7, 1963.

Rehearing Denied April 1, 1963.

Certiorari Refused May 14, 1963.

Shotwell & Brown, Oliver, Digby & Fudickar, Monroe, Cook, Clark, Egan, Yancey & King, Shreveport, for Natural Gas and Oil Corp. and Mississippi River Fuel Corp.

Blanchard, Goldstein, Walker & O'Quin, Shreveport, for Humble Pipe Line Co. Jack P. F. Gremillion, Atty. Gen., Carroll Buck, First Asst. Atty. Gen., Baton Rouge, Ferdinand A. Cashio, Asst. Atty. Gen., Shreveport, for appellee.

Before GLADNEY, AYRES and BOLIN, JJ.

AYRES, Judge.

In each of these cases, the respective plaintiff seeks to recover certain ad valorem taxes assessed and levied against it by the State of Louisiana and by its various taxing authorities, in Ward Two of Bossier Parish, Louisiana. The taxes which are sought to be recovered, in each instance, were paid by the plaintiff under protest, and thereafter these suits were instituted under the provisions of LSA-R.S. 47:2110.

The factual situation, identical as to plaintiffs Natural Gas and Oil Corporation and Mississippi River Fuel Corporation, is to be distinguished from that of the plaintiff, Humble Pipe Line Company. These differences will be noted in the course of this opinion. The same legal principles are, however, generally applicable to all three cases. The record made up on the trial consists of the testimony of Col. Alfred J. Hanlon, Jr., Base Commander of Barksdale Air Force Base, who appeared for the plaintiffs, taken by deposition pursuant to stipulation of the parties, and various documentary offerings and stipulation of counsel.

From a judgment rejecting its demands, each plaintiff has appealed to this court.

The United States of America acquired from the State of Louisiana, City of Shreveport, and the Board of Commissioners of the Bossier Levee District, in the year 1930, certain lands in Bossier Parish approximating 22,000 acres. The conveyances so made were admittedly donations. Shortly thereafter, Barksdale Air Force Base was constructed on a relatively small portion of that acreage and, since that time, the Government has continuously maintained and operated said base for military purposes.

Pertinent to the positions of Natural Gas and Oil Corporation and Mississippi River Fuel Corporation, it may be pointed out that, in 1951, it was determined that certain of the acreage within the total area acquired by the United States of America, as aforesaid, was being drained of minerals through wells drilled on privately owned adjacent lands; consequently, jurisdiction over 2,060 acres thereof was transferred to the Department of Interior with the provision there is to be no interference with the primary use of Barksdale Air Force Base.

By virtue of a lease of said property, executed by the Department of the Interior, Natural Gas and Oil Corporation drilled certain wells productive of oil and gas, which wells, with their equipment, have been assessed and levied upon for ad valorem tax purposes. (Natural Gas and Oil Corporation subsequently merged with the Mississippi River Fuel Corporation.)

As concerns the plaintiff, Humble Pipe Line Company, the taxes herein involved were imposed against two interstate oil trunk pipelines, of 8-inch and 10-inch diameters, respectively, belonging to this plaintiff and extending a distance of 2.91 miles within the acreage acquired by the United States of America, as aforesaid, which, however, are located not within the area covered by the oil, gas, and mineral leases held by the other two plaintiffs, but within the developed area or military reservation proper.

The sole question which is presented in these cases is whether or not the State of Louisiana, and its taxing authorities of Bossier Parish, may levy ad valorem taxes upon the privately owned properties of the respective plaintiffs, used and maintained by them for their commercial purposes, and situated within the enclosure of Barksdale Air Force Base. The plaintiffs contend that the State of Louisiana ceded its right to so tax such property within the said military reservation to the Federal Government and, consequently, now lacks such power. At the very foundation of their claim, of course, is Article I, Section 8, Clause 17, of the Constitution of the United States, and Act 12 of 1892 of the Louisiana Legislature, embodied in LSA-R.S. 52:1. The constitutional provision reads as follows:

'The Congress shall have Power * * *

'To exercise exclusive Legislation in all Cases whatsoever, over such District (not exceeding ten Miles square) as may, by Cession of particular States, and the Acceptance of Congress, become the Seat of the Government of the United States, * * * and to Exercise like Authority over all Places purchased by the Consent of the Legislature of the State in which the Same shall be, for the Erection of Forts, Magazines, Arsenals, dock-Yards, and other needful Buildings; * * *.' (Emphasis supplied.)

The aforesaid legislative provision relied upon by the plaintiffs to support their claim of the State's cession of the power to tax in these instances reads thus:

'The United States, in accordance with the seventeenth clause, eighth section of the first article of the Constitution of the United States, may acquire and occupy any land in Louisiana required for the purposes of the federal government. The United States shall have exclusive jurisdiction over the property during the time that the United States is the owner or lessee of the property. The property shall be exempt from all taxation, assessments, or charges levied under authority of the state.

'The state may serve all civil and criminal process issuing under authority of Louisiana on the property acquired by the United States.'

Of the total acreage acquired by the United States of America, in the year 1930, as aforesaid, the cantonment area of Barksdale Air Force Base covers about 1,000 to 1,500 acres, and an additional improved part of the base, which includes the airfield proper, comprises another 1,500 acres, leaving about 19,000 acres of unimproved land known as the East Reservation. It is in this last-mentioned area that Natural Gas and Oil Corporation and Mississippi River Fuel Corporation have their physical properties against which the ad valorem taxes have been assessed and levied.

Moreover, in Murphy Corp. v. Fontenot (S.Ct., 1954), 225 La. 379, 73 So.2d 180, 183, it was established that this land was set apart from the land used for the governmental purposes of the Air Force Department; in fact, there was a dividing fence between the oil field and the Air Force Base. The court there said:

'These private owners were granted the right of use and control over all instrumentalities, owned and constructed by them, such as drilling machines, towers, tanks and pipe lines for their private commercial purposes to explore for oil and gas and to reduce such to private ownership.'

In other words, the instruments employed by the private businesses, Natural Gas and Oil Corporation and Mississippi River Fuel Corporation, were entirely and exclusively within their own control. It might be emphasized that the land covered by the lease operations is only remotely related to the primary use of the reservation for military purposes. This was made so obvious in the Murphy Corporation case, supra, that the late Justice Moise, as organ of the court, found it necessary to say:

'* * * the land leased was not to be used for the erection of a fort, magazine, arsenal, dock-yard or other needful buildings for military purposes.'

The tax was not one imposed upon, or in any way affecting, property or functions of the Federal Government. In Fort Leavenworth R.R. Co. v. Lowe, 114 U.S 525, 5 S.Ct. 995, 1002, 29 L.Ed. 264, 269, the Supreme Court of the United States clearly recognized the residual power of the State to tax in instances where the Federal Government does not use places acquired in the execution of its own powers. Thus, it was stated:

'Where, therefore, lands are acquired in any other way by the United States within the limits of a state Than by purchase with her consent, they will hold the land subject to this qualification: that if upon them forts, arsenals, or other public buildings are erected for the uses of the general government, such buildings, with their appurtenances, as instrumentalities for the execution of its powers, will be free from such interference and jurisdiction of the state as would destroy or impair their effective use for the purposes designed. Such is the law with reference to all instrumentalities created by the general government. Their exemption from state control is essential to the independence and sovereign authority of the United States within the sphere of their delegated powers. But, when not used as such instrumentalities, the legislative power of the state over the places acquired will be as full and complete as over other places within her limits.' (Emphasis supplied.)

Plaintiffs Natural Gas and Oil Corporation and Mississippi River Fuel Corporation contend that neither the Murphy Corporation case, supra, certiorari denied by Supreme Court of the United States, 348 U.S. 831, 75 S.Ct. 54, 99 L.Ed. 655, nor Mississippi River Fuel Corporation v. Fontenot (C.C.A.5), 234 F.2d 898, certiorari denied by Supreme Court of United States, 352 U.S. 916, 77 S.Ct. 213, 1 L.Ed.2d 122, is appropriate because they involved gas gathering and severance taxes decided on...