Sperry Oil Gas Co v. Chisholm

• Decision Date: 07 April 1924
• Docket Number: No. 164,164
• Citation: 68 L.Ed. 803,264 U.S. 488,44 S.Ct. 372
• Parties: SPERRY OIL & GAS CO. et al. v. CHISHOLM et al
• Court: U.S. Supreme Court

264 U.S. 488

44 S.Ct. 372

68 L.Ed. 803

SPERRY OIL & GAS CO. et al.

v CHISHOLM et al.

No. 164.

Argued Jan. 16, 1924.

Decided April 7, 1924.

Messrs. Preston C. West and Alvin Richards, both of Tulsa, Okl., for appellants.

Mr. H. L. Underwood, of Washington, D. C., for the United States.

[Argument of Counsel from page 489 intentionally omitted] Mr. J. H. Langley, of Pryor, Okl., for appellees.

Mr. Justice SANFORD delivered the opinion of the Court.

The appellees, Webster Chisholm, a halfblood Cherokee Indian, and his wife, brought this suit in a State court of Oklahoma to cancel a supplemental instrument modifying and extending an oil and gas lease previously executed by him upon his 'homestead' and 'surplus' allotments of tribal lands. It was removed to the Federal District Court. That court, upon final hearing, entered a decree adjudging this instrument to be entirely null and void, and enjoining interference with the plaintiffs' possession of the premises.¹ This decree was affirmed by the Circuit Court of Appeals. 282 Fed. 93. An appeal to this court was allowed by a Circuit Judge; and thereafter the appellants were also granted a writ of certiorari. 261 U. S. 611, 43 Sup. Ct. 363, 67 L. Ed. 826.

As the suit was removed to the Federal Court upon the ground that it arose under the laws of the United States,² the decree of the Circuit Court of Appeals was not made final by the provisions of Section 128 of the Judicial Code (Comp. St. § 1120) and Section 3 of the Act of September 6, 1916, c. 448, 39 Stat. 726 (Comp. St. § 1120a). Southern Pacific Co. v. Stewart, 245 U. S. 562, 38 Sup. Ct. 203, 62 L. Ed. 472. Therefore the appeal was properly allowed under Section 241 of the Judicial Code (Comp. St. § 1218), and the writ of certiorari must be dismissed.

Chisholm is an enrolled citizen of the Cherokee Nation, of the half-blood. Pursuant to the Cherokee Agreement—embodied in the Act of July 1, 1902, c. 1375, 32 Stat. 716—he was allotted two tracts of tribal lands; one of thirty acres designated as a 'homestead,' and another adjoining tract of fifty acres designated as 'surplus.' The alienation of both of these tracts was then restricted. In 1904, while unmarried, he executed an oil and gas lease for a term of fifteen years to the Creek & Indiana Development Company, covering, as an entirety, the eighty acres of his two allotments. It contained no provision for an extension or renewal. This lease was approved by the Secretary of the Interior. Chisholm married in 1911. In 1912, he and his wife moved upon the leased land, and have since that time occupied and claimed the entire eighty acres as a family homestead. Their residence is upon the 'homestead' thirty acres, the cultivated land and pasture extending upon the 'surplus' fifty acres. Neither owns any other land. In 1914—more than five years before the expiration of the lease—the lessee having found oil in paying quantities and completed the drilling of five wells, Chisholm executed a written instrument modifying the terms of the lease, in accordance with regulations prescribed by the Secretary of the Interior, so as to provide for an increased royalty and extend the lease as long as oil or gas should be found in paying quantities. This instrument—hereinafter called the extension lease was approved by the Secretary of the Interior as to the 'homestead' thirty acres, which was still restricted land; but was neither approved nor disapproved by him as to the 'surplus' fifty acres, from which the restrictions had previously been removed. It was not, however, executed or joined in by his wife. Later in the same year the Development Company assigned the lease to the Sperry Oil & Gas Company; and that Company in 1918 assigned it to the Oklahoma Producing & Refining Corporation. The suit was commenced in 1919, about three months after the expiration of the term of the original lease. The lessees had then driven eleven wells on the leased premises and removed a large amount of oil. All royalty due under the leases at the original and increased rates had been paid by the lessees to Chisholm, or to the Indian agent for his benefit, and had been received by Chisholm; and such payments were continued to the time of the trial. His wife, however, received no part of this royalty, and did not learn that he had extended the original lease until shortly before the commencement of the suit.

1. The ground of decision in both the lower courts was that the extension lease executed by Chisholm was void under the provisions of the Constitution and laws of Oklahoma relating to family homesteads because it was not joined in or consented to by his wife. The Constitution of Oklahoma provides that the rural homestead of any family in the State 'shall consist of not more than one hundred and sixty acres of land, * * * in one or more parcels, to be selected by the owner,' and that 'nothing in the laws of the United States * * * shall deprive any Indian or other allottee of the benefit of the homestead and exemption laws of the State.' Article 12, § 1. These provisions are also contained in the state statutes. 1 Rev. Laws, 1910, § 3343, p. 834. The family homestead of an Indian under the state law may include his tribal 'homestead' allotment as well as his tribal 'surplus' allotment. Hyde v. Ishmael, 42 Okl. 279, 143 Pac. 1044; Norton v. Kelley, 57 Okl. 222, 156 Pac. 1164; Belt v. Bush (Okl. Sup.) 176 Pac. 935. It is further provided by a statute originating in the territorial Session Laws of 1901, c. 10, p. 78, that 'no deed, mortgage or contract relating to the homestead,' except a lease for not exceeding one year, 'shall be valid unless in writing and subscribed by both husband and wife.' 1 Rev. Laws, 1910, § 1143, p. 292. This applies to oil and gas leases covering the homestead. Carter Oil Co. v. Popp (Okl. Sup.) 174 Pac. 747; Rich v. Donaghey (Okl. Sup.) 177 Pac. 86, 3 A. L. R. 352; Treese v. Shoemaker, 80 Okl. 235, 195 Pac. 766. And, the interest of the husband and wife in the homestead not being severable, a lease or other contract relating to the homestead executed by the husband alone, may be set aside in an action brought by the husband and wife, unless she is estopped by her acts and conduct from asserting its invalidity. Hall v. Powell, 8 Okl. 276, 57 Pac. 168; Kelly v. Mosby, 34 Okl. 218, 124 Pac. 984; Brusha v. Board of Education, 41 Okl. 595, 139 Pac. 298, L. R. A. 1916C, 233; Hyde v. Ishmael, supra; Carter Oil Co. v. Popp. supra.

2. In our opinion, however, these provisions of the Constitution and laws of Oklahoma have no application to so much of the extension lease as covers the tribal 'homestead' of thirty acres.

By the Oklahoma Enabling Act of June 16, 1906 c. 3335, 34 Stat. 267, it was provided that nothing in the Constitution of the State should be construed to limit or affect the authority of the Government of the United States to make any law or regulations respecting the Indians of the Territory, their lands, property or other rights, which it would otherwise have been competent to make. Section 1. The terms and conditions of the Enabling Act were accepted by the Constitutional Convention of Oklahoma by an 'irrevocable' ordinance, which was ratified with the Constitution itself. Coyle v. Oklahoma, 221 U. S. 559, 564, 31 Sup. Ct. 688, 55 L. Ed. 853; Jefferson v. Winkler, 26 Okl. 653, 662, 110 Pac. 755; Molone v. Wamsley, 80 Okl. 181, 182, 195 Pac. 484. Congress was thus careful to preserve to the United States the authority over the Indians, their lands and property, which it possessed prior to the passage of the Enabling Act; retaining full power, which it had exercised from the earliest period, to deal with them as a dependent people and legislate concerning their property with a view to their protection; with the right to determine when, in their interest, the Government guardianship should cease, and plenary authority, notwithstanding the bestowal of Federal citizenship upon them, to place restrictions upon their right of alienating the lands allotted to them. Tiger v Investment Co., 221 U. S. 286, 309, 31 Sup. Ct. 578, 55 L. Ed. 738; Heckman v. United States, 224 U. S. 413, 416, 32 Sup. Ct. 424, 56 L. Ed. 820. And in all matters relating to the restrictions upon their allotted lands resort must be had to the Acts of Congress and to those Acts alone. Walker v. Brown, 43 Okl. 144, 141 Pac. 681; Collins Inv. Co. v. Beard, 46 Okl. 310, 148 Pac. 846; Wison v. Greer, 50 Okl. 387, 151 Pac. 629; Smith v. Williams, 78 Okl. 297, 190 Pac. 555; Molone v. Wamsley, supra.

By the Act of May 27, 1908, c. 199, 35 Stat. 312—which was in force when the extension lease was executed—it was provided that the 'homesteads' allotted to members of the Five Civilized Tribes of the half-blood should not be subject to alienation or incumbrance prior to April 26, 1931, unless such restrictions were removed by the Secretary of the Interior; but all restrictions upon the alienation or incumbrance of their other allotted lands were removed. Section 1. And it was further provided that 'leases of restricted lands for oil, gas or other mining purposes * * * may be made, with the approval of the Secretary of the Interior, under rules and regulations provided by the Secretary of the Interior, and not otherwise.' Section 2. No other conditions were attached to the making of such leases.

The authority thus given by the Act of Congress to an Indian of the half-blood to make an oil and gas lease upon his restricted 'homestead' allotment, with the approval of the Secretary of the Interior, cannot be limited or contravened by the provision of the Oklahoma law attaching to the execution of a lease upon the family homstead the condition that it must also be executed by his wife. This added requirement is inconsistent with the authority given the allottee by the Act of Congress to make such lease when approved by the Secretary of the Interior, and, it the wife does not consent to the lease,...