Sierra Club v. Louisiana Dept. of Wildlife and Fisheries
| Decision Date | 14 January 1988 |
| Docket Number | No. CA-8022,CA-8022 |
| Citation | 519 So.2d 836 |
| Parties | SIERRA CLUB, et al. v. LOUISIANA DEPARTMENT OF WILDLIFE & FISHERIES, et al. 519 So.2d 836 |
| Court | Court of Appeal of Louisiana — District of US |
Donald E. Puckett, Baton Rouge, for appellant, Louisiana Dept. of Wildlife & Fisheries.
Joseph E. LeBlanc, Jr., Eric E. Jarrell, Milling, Benson, Woodward, Hillyer, Pierson & Miller, James A. Burton, Susan F. Clade, Simon, Peragine, Smith & Redfearn, John R. Peters, Jr., Jones, Walker, Waechter, Poitevent, Carrere & Denegre, New Orleans, for intervenor and appellant.
Michael Osborne, Osborne & McComiskey, New Orleans, for appellees.
William J. Guste, Jr., Atty. Gen., Gary L. Keyser, John B. Sheppard, Jr., Ian Douglas Lindsey, William G. Davis, Asst. Attys. Gen., New Orleans, for intervenor, State of La.
Before GULOTTA, C.J., and WARD and WILLIAMS, JJ.
The primary question confronting us in this appeal is whether the Louisiana Wildlife and Fisheries Commission must follow public bidding procedures before it grants a party the right to take fossil clam and oyster shell deposits from State owned water bottoms. Because we conclude that these contracts involve mineral rights which must be leased through public bids, we affirm that portion of a judgment declaring three negotiated leases unlawful.
The lakes and coastal waters of Louisiana are rich in deposits of fossil oyster and clam shells. When dredged and processed, these shells are commercially useful, especially as a building material for roads and levees. A large industry has developed to exploit this resource, and the Wildlife and Fisheries Commission, as the agency empowered to manage State owned water bottoms, has granted exclusive rights to private companies to extract the shells in return for paying royalties to the State at a stated price per cubic yard of material taken. For decades, the Commission has confected these dredging leases by negotiating directly with the companies without publicly advertising for bids from all interested parties.
As a public interest group concerned with Louisiana's natural resources, the Sierra Club filed this suit for declaratory judgment to invalidate three shell dredging leases granted by the Commission. 1 Plaintiffs alleged that the leases were void on three grounds: (1) that the Commission had granted the dredging rights without public bidding as required by LSA-R.S. 41:1211 et seq., the Public Lease Law; (2) that one of the lessees was an Alabama corporation contrary to LSA-R.S. 56:425, which restricts leases of State owned water bottoms to Louisiana residents and corporations; and (3) that the leases unlawfully permitted the lessees to remove shells from water bottoms instead of only reef formations as provided by LSA-R.S. 56:441(B).
In a motion for summary judgment, plaintiffs also argued that the leases affected an area in excess of "one million seven hundred forty thousand acres" and thereby violated LSA-R.S. 56:432, which limits leases of water bottoms to no more than one thousand acres to any person, partnership, or corporation. In further support of their arguments for public bidding, plaintiffs contended that clam and oyster shell deposits on State water bottoms are "mineral resources" that can only be leased pursuant to LSA-Const. Art. IX, Sec. 5 and LSA-R.S. 30:156, which require public bidding for minerals and mineral rights owned by the State and its agencies.
In opposition to plaintiffs' motion and in support of their own cross motion for summary judgment, the intervening shell dredging companies and the Commission contended that the leases had been validly confected pursuant to a statutory exception to the public bidding laws. According to the companies, LSA-R.S. 56:441 sets forth a detailed procedure for the Commission to follow in granting shell dredging leases to "any person", without any public bidding requirements or limitation on the area to be leased. 2 They also cited LSA-R.S. 56:471 as a statutory basis for dredging Rangia clam shells. 3 The companies contended that these statutes authorize the Commission to negotiate agreements to remove both clam and oyster shell deposits from State owned reefs as well as water bottoms.
On the motions for summary judgment, the trial judge held the three leases unlawful based on the following declarations of law: (1) that LSA-R.S. 56:441 applies only to reef formations and does not vest the Commission with the right to transfer shell deposits from non-reef formations, i.e., water bottoms; (2) that the 1,000 acre territorial limitation contained in LSA-R.S. 56:432 applies to leases for removal of shell deposits granted by the Commission; (3) that the Louisiana residency requirement of LSA-R.S. 56:425(A) likewise applies to shell dredging leases; and (4) that any lease by the Commission for the taking of shell deposits is subject to the public bidding procedures set forth in LSA-R.S. 30:156, dealing with mineral leases.
On appeal by the shell dredging companies, the parties have advanced essentially the same arguments raised in the trial court. The Attorney General of Louisiana has intervened on appeal in support of plaintiffs' contentions.
At the outset, we find merit to the shell dredgers' contention that LSA-R.S 56:441 and 56:471 authorize the Commission to grant any person the right to take both clam and oyster shell deposits from both reefs and water bottoms.
Although LSA-R.S. 56:441 speaks only of "reefs" and does not specifically mention "water bottoms", in Gorham v. Mathieson Alkali Works, 210 La. 462, 27 So.2d 299 (1946), the Supreme Court held that the Conservation Commission of Louisiana had authority to grant permits for the removal of clam shell deposits from navigable water bottoms in Calcasieu Parish. The Gorham court recognized a history of letting contracts for the taking of oyster and clam shells pursuant to regulations and statutes constituting the Commission as the department of government with authority to manage the water bottoms of the State. Among the authorities cited in the opinion was Act 42 of 1914, the precursor to LSA-R.S. 56:441. Based on the Gorham decision, we interpret LSA-R.S. 56:441 as authority for the Commission to permit shell dredging on State owned water bottoms as well as reefs.
We find further authority for shell dredging in LSA-R.S. 36:609. This statute deals with the powers and functions of the Department of Wildlife and Fisheries. In pertinent part, LSA-R.S. 36:609(C)(1) provides that the office of Coastal and Marine Resources of this Department shall:
"(1) Perform the functions of the state relating to the administration, operation, and law enforcement of programs, including research, relating to oysters, water bottoms, and seafoods, including but not limited to the regulation of the oyster, shrimp, and marine fishing industries, the leasing of and regulations of the use of water bottoms for the cultivation and propagation of oysters, and the dredging of shells, sand, gravel and fill materials ... and the collection of the severance tax on shrimp, oysters, shells, sand, gravel, and fill materials severed from State water bottoms [Emphasis ours]".
Reading this statutory provision together with the Gorham opinion, LSA-R.S. 56:441 and 56:471, we conclude that the trial judge erred in declaring that LSA-R.S. 56:441 does not vest the Commission with the right to transfer the privilege of taking shell deposits from non-reef formations.
We further conclude that the trial judge erred in restricting shell dredging leases to the one thousand acre territorial limitation of LSA-R.S. 56:432 and to the Louisiana residency requirement of LSA-R.S. 56:425.
Both LSA-R.S. 56:432 and LSA-R.S. 56:425 are found in a subpart of Title 56 dealing with oysters and oyster industries. The Supreme Court has recently noted that this subsection "... provides for the leasing of water bottoms to oyster lessees and the designation and regulation of other areas for the taking of oysters without leases." State v. Powell and Jones, 515 So.2d 1085 (La.1987). Indeed, in setting forth the territorial limitation, LSA-R.S. 56:432 speaks of a "lessee who owns or operates more than one canning plant in this state". Similarly, LSA-R.S. 56:425(D) speaks of boundary disputes "between lessees of bedding grounds". This phraseology, in the context of the entire statutory scheme, demonstrates that the residency requirement and the 1,000 acre limitation apply only to the leasing of beds and grounds for oyster cultivation.
Although LSA-R.S. 56:441 is found in the same statutory sub-part dealing with oysters, it is a singular, self-contained provision addressing fossil shell dredging, an activity entirely different from the oyster cultivation. In construing LSA-R.S. 56:441, therefore, we do not read the restrictions on the live oyster industry in pari materia with this section on shell dredging since they are not "upon the same subject matter." See LSA-C.C. Art. 17. Accordingly, we conclude that the territorial limits and residency requirements for leasing water bottoms to oyster lessees do not apply to grants of rights to take shell deposits under LSA-R.S. 56:441 and LSA-R.S. 56:471.
The crucial issue confronting us, however, is whether the Commission must comply with public bidding procedures in exercising its statutory authority to grant persons the right of taking shell deposits.
Public bidding laws are founded on a policy of protecting the citizens and taxpayers of this State. Martin v. La. Stadium & Exposition Dist., 349 So.2d 349 (La.App. 4th Cir.1977). Generally, the State and its subdivisions must follow public bidding procedures, 4 unless a statute expressly exempts them from doing so. Arnold v. Bd. of Levee Com'rs, 366 So.2d 1321 (La.1978); Hall v. Rosteet, 247 La. 45, 169 So.2d 903 (1964).
Although the parties acknowledge that public...
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