United States v. Brewer-Elliott Oil & Gas Co.

• Decision Date: 21 February 1918
• Docket Number: 75.
• Citation: 249 F. 609
• Court: U.S. District Court — Western District of Oklahoma
• Parties: UNITED STATES v. BREWER-ELLIOTT OIL & GAS CO. et al.

249 F. 609

UNITED STATES v. BREWER-ELLIOTT OIL & GAS CO. et al.

No. 75.

United States District Court, W.D. Oklahoma.

February 21, 1918

Francis J. Kearful, Asst. Atty. Gen., John A. Fain, U.S. Atty., of Lawton, Okl., and Isaac D. Taylor, of Oklahoma City, Okl for plaintiff.

S.P Freeling, Atty. Gen., and Ledbetter, Stuart & Bell, Burwell Crockett & Johnson, and Blake & Boys, all of Oklahoma City Okl., for defendants and interveners.

COTTERAL District Judge.

This suit was brought by the United States, as trustee for the Osage Tribe of Indians and for itself, against several companies holding oil and gas leases from the state of Oklahoma of the bed of the Arkansas river, below high-water marks, near Cleveland, Okl., and located in sections 1, 12, and 13, range 7 east; sections 6, 7, 24, and 25, range 8 east; and section 30, range 9 east--all in township 21 north, in this district. A decree is sought canceling the leases, enjoining operations and obstructions under them, and quieting title to the premises.

As a basis for relief in behalf of the Indians, it is alleged in the bill that the title to the river bed, limited in this case to the middle of the main channel, with the underlying oil and gas claimed adversely by the defendants, was granted and conveyed to the tribe, as a part of the Osage Reservation, pursuant to law and treaty, regardless of the navigability of the river; and that, as the river was then and still is nonnavigable at the above locations, such tribal title also arose from the ownership of the adjacent lands. The further complaint that the derricks and structures maintained by the defendants constitute and should be abated as obstructions to navigation of the river, if navigable, has not been pressed, and is without merit. The suit stands therefore as prosecuted solely in the interest of the tribe.

The state of Oklahoma and the Commissioners of the State Land Office intervened in the suit. They deny title in the tribe, and claim that the river is and always was navigable, that the title to the bed below high-water marks was not subject to disposal by the United States, but was held in trust for the state, and that the state, on admission in 1907, by virtue of its sovereignty, became invested with the title and the right to make the leases, as was done, conformably to the state Constitution and laws. The lessees similarly plead their rights under the leases.

At the outset, upon stipulation of counsel, a receiver was appointed with authority to collect and preserve all royalties and bonuses arising from the production of oil and gas, under the terms of the leases and the regulations of the State Land Office, assisted by a supervisory committee, representing the conflicting interests. Later, the Gypsy Oil Company, a lessee of adjacent lands, was made a party defendant, because of controversy over a division line with the Scioto Oil Company, a defendant lessee, and the receivership was extended to the operation of its lease, but was later terminated upon adjustment between the parties, and operation was restored to the company. From an order construing that lease and directing the receiver as to the bonus payable from his funds by that lessee, an appeal has been allowed. Other orders have been passed in the course of the receivership, not essential to the controversy now before the court.

The case was tried and submitted at a full hearing; and counsel have presented their contentions in oral arguments and briefs, with a thoroughness and ability quite in keeping with the importance of the questions involved.

The main questions for decision are whether, before the inception of any claim of title by the state, there was an effective grant of title to the tribe of the bed of the Arkansas river, even if navigable, and, if not, then whether the river is navigable or not, whereby the title to the disputed portion was vested in the state or the tribe.

The claim of an antecedent grant is rested on the supposed exercise of a power vested in Congress thus to carry out a public purpose for which the lands were held. Shively v. Bowlby, 152 U.S. 1, 14 Sup.Ct. 548, 38 L.Ed. 331; United States v. Winans, 198 U.S. 371, 25 Sup.Ct. 662, 49 L.Ed. 1089; McGilvra v. Ross, 215 U.S. 70, 30 Sup.Ct. 27, 54 L.Ed. 95.

The Osage Reservation was purchased from the Cherokee Nation and was a part of the lands the Cherokees acquired out of the domain of the Louisiana Purchase, the object of which was expressed in the treaty with France to be the formation of new states. 8 Stat. 200, art. 3. That policy was not, however, adhered to in providing for the settlement of the Cherokees west of the Mississippi river. As the lands described in their patent of December 31, 1838, lie on both sides of the Arkansas river here involved, the first inquiry is, naturally, whether they had a title to the bed of the river, if navigable.

The treaties and acts affecting their title are reviewed in the case of Heckman v. United States, 224 U.S. 413, 32 Sup.Ct. 424, 56 L.Ed. 820. The stipulations made in their favor that they were to be secured a permanent home, not embarrassed by state lines or jurisdiction, and a free and unmolested outlet on the west, and were authorized with limitations to make local laws concerning persons and property, did not exclude but implied the need of federal control over navigable streams, if any, in their country. It would remain not only consistent with the rights of the Indians, but important to their advancement, that any avenue of transportation be kept open for their benefit. A similar policy toward the Indians is found in the congressional grants for the construction of railroads through Indian Territory. And the Act of March 3, 1811 (Act March 3, 1811, c. 46, § 12, 2 Stat. 666 [Comp.St.1916, § 9846]) still applied in providing that "all the navigable rivers and waters in the former territories of Orleans and Louisiana shall be and forever remain public highways." Conceding full force to the laws and treaties applicable, it is clear that the Cherokees had no title to any navigable stream in their country. As a result, they could convey none in any event to the bed of the Arkansas river, at the Osage boundary, if there navigable.

The next question is with reference to the title acquired by the Osage Tribe. By treaty and law, provision was made for the sale of their lands in Kansas, payments to them, and their removal to Indian Territory. Treaty Sept. 29, 1865, 14 Stat. 687; Act July 15, 1870, c. 296, 16 Stat. 362. The Cherokees stipulated in the treaty of July 19, 1866 (14 Stat. 799), for the settlement of friendly Indians in their country west of the Ninety-Sixth Meridian, with terms of payment left to future agreement, etc. As the early settlements occurred east of that meridian, by the Act of June 5, 1872 (c. 310, 17 Stat. 228), selections west of it were confirmed as their reservation, within which they were to permit the settlement of the Kansas Tribe, which was to make payment from the proceeds of lands in Kansas, and the lower boundary of the reservation was defined as the north line of the Creek Country and the main channel of the Arkansas river. The Act of March 3, 1873 (c. 228, 17 Stat. 538), provided for payment to the Cherokees out of the funds of the Osages for the lands purchased by them. By the Act of March 3, 1883 (c. 143, 22 Stat. 624), a further payment was appropriated out of funds due under appraisement of Cherokee lands west of the Arkansas river, and the Cherokee Nation was to execute conveyances satisfactory to the Secretary of the Interior to the United States in trust for the Pawnees, Poncas, Nez Perces, Otoes, and Missourias, and Osages "now occupying said tract, as they respectively occupy the same before payment of said sum of money."

A formal deed was executed on June 14, 1893, by the Cherokee Nation to the United States in trust for the Osage and Kansas Indians. Certain whole and fractional townships were described, and the latter as being on "the left bank of the Arkansas river," according to a plat annexed and made a part of the conveyance. It was also recited that a part of said lands had been set apart for the Kansas Indians, consisting of townships whole and fractional, then described and indicated on the plat.

On the plat is a note, reciting that all the islands opposite the lands described in the deed, except Beaver and Turkey, in township 23 north, range 3 east, conveyed of even date for the Otoe and Missouria Indians, are "a part and parcel of the lands set apart for the Osage and Kansas Indians, and are covered by and embraced in this plat and the foregoing deed of conveyance." In addition, an island, apparently illustrative, is shown as the west boundary of the Osage Reservation.

The deed did not limit the area of the Osage lands, as confirmed by the act of 1872. As it was but a fulfillment of treaty and law, the authority of the Secretary of the Interior was to require conformity with them. The designation of the river boundary as "the main channel" in the act and "the left bank" in the deed are therefore held equivalent. A sufficient reason for holding that there was no limitation by the deed is that the title was vested in the tribe by the act of 1872, without a deed. Jones v. Meehan, 175 U.S. 1, 20 Sup.Ct. 1, 44 L.Ed. 49; Francis v. Francis, 203 U.S. 233, 27 Sup.Ct. 129, 51 L.Ed. 165; Chase v. United States, 222 F. 593, 138 C.C.A. 117.

The plat and note were effectively incorporated in the deed by reference. Cragin v. Powell, 128 U.S. 691, 9 Sup.Ct 203, 32 L.Ed. 566; Jeffries v. East Omaha Land Co., 134 U.S. 178, 10 Sup.Ct. 518, 33 L.Ed. 872; Beach Front Hotel Co. v. Sooy, 197 F. 881, 118 C.C.A. 579. The authenticity of the note, which has been...