United States v. Louisiana

• Decision Date: 28 April 1980
• Docket Number: No. 9,O,9
• Citation: 100 S.Ct. 1618,64 L.Ed.2d 196,446 U.S. 253
• Parties: UNITED STATES, Plaintiff, v. State of LOUISIANA et al. rig
• Court: U.S. Supreme Court

446 U.S. 253

100 S.Ct. 1618

64 L.Ed.2d 196

UNITED STATES, Plaintiff,

v State of LOUISIANA et al.

No. 9, Orig.

Argued March 18, 1980.

Decided April 28, 1980.

Rehearing Denied June 16, 1980.

See 447 U.S. 930, 100 S.Ct. 3007.

Syllabus

Held:

1. As the Special Master recommended, the United States is not obligated to account for and pay Louisiana either the value of the use of Louisiana's share of impounded funds that have been awarded and paid to the State under mineral leases on lands off its Gulf Coast, or interest upon that portion of those funds. The Interim Agreement that the parties entered into in response to this Court's ruling enjoining them from leasing wells in the disputed tidelands area except by agreement provided only that the payments made to the United States on each lease within the disputed area were to be impounded "in a separate fund in the Treasury of the United States" and, upon determination of the ownership of the lands, were to be taken from that fund and paid to the party entitled to them. The agreement contains no provision for the payment of interest or for the use of the funds or for investment, and there is nothing in the agreement's use of the word "impound," or in Louisiana's characterization of the arrangement as an escrow, to imply an obligation on the United States' part to pay interest or to pay for the use of the money. The impoundment of the funds having served its intended purpose, and all payments due Louisiana from the impounded funds having been made, the United States has fulfilled the obligations imposed upon it by the agreement. Pp. 261-266.

2. Contrary to the Special Master's recommendations, Louisiana is obligated to account to the United States for revenues derived by the State from mineral leases on areas within the zone contiguous to the coastline (Zone 1) adjudicated to the United States. The provision of the Outer Continental Shelf Lands Act authorizing the United States to make an agreement with a State as to existing mineral leases and the issuance of new leases "pending the settlement or adjudication" of a controversy as to ultimate ownership, and stating that payments made pursuant to such an agreement shall be considered as compliance with certain lease validation requirements of the Act, does not govern payments made by Louisiana's lessees in Zone 1 so as to foreclose any federal claim with respect to those payments. The provision means no more than that a lessee is not in default so long as the agreement remains in effect and he makes the required payments, and there is no basis for reading into the provision a waiver by the United States of Louisiana's independent duty to account, or a waiver of any claim for money due the United States. The State's obligation does not derive from the Act, but was imposed by this Court's 1950 decree specifying that the United States was entitled to an accounting from Louisiana of all sums received by the State from lands adjudicated to the United States, was not waived by the Interim Agreement, and is not excused by the above provision of the Outer Continental Shelf Lands Act. Pp. 266-272.

3. The Court accepts, upon acquiescence of the parties, the Special Master's recommendations that Louisiana has no obligation to account for and pay to the United States money collected by the State as severance taxes on minerals removed from areas adjudicated to the United States. P. 272.

Exceptions to Special Master's supplemental report overruled in part and sustained in part, and case remanded.

Louis F. Claiborne, Washington, D. C., for plaintiff.

William J. Guste, Jr., Atty. Gen., and Frederick W. Ellis, Baton Rouge, La., for defendants.

Mr. Justice BLACKMUN delivered the opinion of the Court.

We are concerned here with certain features of what appears to be the final stage of the long-continuing and sometimes strained controversy between the United States and the State of Louisiana over the proceeds of mineral leases on lands off Louisiana's Gulf Coast. Specifically at issue are the asserted obligation of the United States for interest on, or for the value of the use of, impounded funds that have been awarded and paid to Louisiana, and the asserted obligation of Louisiana to account to the United States for certain unimpounded lease revenues received by the State.

I

Litigation between the United States and the State of Louisiana over rights in lands submerged in the Gulf of Mexico off the Louisiana coast began over 30 years ago, in 1948, when the United States moved this Court, under its original jurisdiction, for leave to file a complaint. The Government prayed for a decree (a) declaring rights of the United States as against Louisiana over lands "underlying the Gulf of Mexico, lying seaward of the ordinary low-water mark on the coast of Louisiana and outside of the inland waters, extending seaward twenty-seven marine miles and bounded on the east and west, respectively, by the eastern and western boundaries of the State of Louisiana," and (b) requiring that Louisiana account to the United States for money received by the State after June 23, 1947, from the area so designated. Over opposition, the requested leave was granted. United States v. Louisiana, 337 U.S. 902, 69 S.Ct. 1040, 93 L.Ed. 1716 (1949). Louisiana was directed to answer. 337 U.S. 928, 69 S.Ct. 1490, 93 L.Ed. 1736 (1949). The State, however, filed a demurrer and motions to dismiss and for other relief. These were overruled and denied. 338 U.S. 806, 70 S.Ct. 36, 94 L.Ed. 488 (1949).

Louisiana then did answer, placing in issue the claims of the United States and asserting affirmative defenses. The plaintiff's responsive motion for judgment was set down for argument. The Court ruled that United States v. California, 332 U.S. 19, 67 S.Ct. 1658, 91 L.Ed. 1889 (1947), then recently decided, controlled the Louisiana litigation. In that case, the Court had held that California was not the owner of the marginal belt along its coast beyond the low-water mark, and that the Federal Govern- ment had primary rights in and power over that belt. The rationale, it was said, was that "[n]ational rights must therefore be paramount in that area." 339 U.S. 699, 704, 70 S.Ct. 914, 916, 94 L.Ed. 1216 (1950). A decree was entered enunciating the United States' possession of "paramount rights" and Louisiana's lack of "title thereto or property interest therein"; enjoining Louisiana from carrying on activities in the area for the purpose of taking petroleum, gas, or other mineral products without authority first obtained from the United States; and stating that the United States was entitled to an accounting from Louisiana of sums derived by the State from the area since June 5, 1950 (the date of the Court's opinion). 340 U.S. 899, 71 S.Ct. 275, 95 L.Ed. 651 (1950). A like decree was entered in a companion case against Texas. United States v. Texas, 340 U.S. 900, 71 S.Ct. 276, 95 L.Ed. 652 (1950).

The Submerged Lands Act, 67 Stat. 29, 43 U.S.C. § 1301 et seq., passed May 22, 1953, came in response to these rulings. By that statute, the United States released to the coastal States its rights in the submerged lands within stated limits and confirmed its own rights therein seaward of those limits. The Act was sustained as a constitutional exercise of Congress' power to dispose of federal property. Alabama v. Texas, 347 U.S. 272, 74 S.Ct. 481, 98 L.Ed. 689 (1954).

The passage of the Act, however, did not end the controversy. Opposing claims continued to be asserted, and Louisiana continued to conduct leasing activities with respect to submerged lands in the disputed area. Accordingly, in 1956, the United States sought and was granted leave to file a complaint in a new suit (the present litigation) against Louisiana. 350 U.S. 990, 76 S.Ct. 541, 100 L.Ed. 856. The Court forthwith enjoined Louisiana and the United States "from leasing or beginning the drilling of new wells in the disputed tidelands area . . . unless by agreement of the parties filed here." 351 U.S. 978, 76 S.Ct. 1043, 100 L.Ed. 1494 (1956). In response to this ruling, on October 12, 1956, the parties entered into an Interim Agreement designed to permit further development of the submerged lands in dispute. Interpretation of this agreement is the central task of this opinion. The lawsuit continued, and in 1957 the other Gulf States in effect were requested to intervene. 354 U.S. 515, 77 S.Ct. 1373, 1 L.Ed.2d 1525.

In due course this Court held, among other things, that the Submerged Lands Act granted Louisiana ownership "to a distance no greater than three geographical miles from its coastlines, wherever those lines may ultimately be shown to be." 363 U.S. 1, 79, 80 S.Ct. 961, 1005, 4 L.Ed.2d 1025 (1960). A "Final Decree" was entered accordingly. 364 U.S. 502, 81 S.Ct. 258, 5 L.Ed.2d 247 (1960). That decree, like the one of 1950 in the earlier litigation, confirmed in the United States as against Louisiana all the land, minerals, and other natural resources underlying the Gulf of Mexico more than three geographic miles seaward from the coastline; recited that Louisiana had no interest therein and was enjoined from interfering with the rights of the United States; stated that as against the United States Louisiana was entitled to all the lands, minerals, and other natural resources underlying the Gulf extending seaward from its coastline three geographic miles, and that the United States was not entitled to any interest therein (with a stated exception inapplicable here); and provided that whenever the location of the coastline of Louisiana should be agreed upon or determined, the State was to render the United States an appropriate accounting of all sums derived by it since June 5, 1950, "either by sale, leasing, licensing, exploitation or otherwise from or on account of any of the lands or resources [decreed to the United States] . . . provided, however, that as to the State of Louisiana the allocation,...