West v. Standard Oil Co, 71

• Decision Date: 02 January 1929
• Docket Number: No. 71,71
• Citation: 278 U.S. 200,73 L.Ed. 265,49 S.Ct. 138
• Parties: WEST, Secretary of the Interior, v. STANDARD OIL CO
• Court: U.S. Supreme Court

278 U.S. 200

49 S.Ct. 138

73 L.Ed. 265

WEST, Secretary of the Interior,

v STANDARD OIL CO.

No. 71.

Argued Oct. 24 and 25, 1928.

Decided Jan. 2, 1929.

Mr. W. C. Morrow, of Seattle, Wash., for petitioner.

[Argument of Counsel from pages 201-202 intentionally omitted] Messrs. Oscar Sutro, of San Francisco, Cal., Louis Titus, of Washington, D. C., for respondent.

[Argument of Counsel from pages 203-207 intentionally omitted] Mr. Justice BRANDEIS delivered the opinion of the Court.

This suit was brought in October, 1925, by the Standard Oil Company in the Supreme Court of the District of Columbia against Dr. Work, the then Secretary of the Interior, to enjoin the continuation of proceedings in the local land office at Visalia, Cal., ordered by him with a view to ascertaining and determining whether particular lands were known to be mineral in character when the survey of them was accepted. State of California, Standard Oil Co., Transferees, 51 L. D. 141. Upon his resignation, Secretary West was substituted as defendant. The proceedings were of the kind commonly employed by the Secretary of the Interior to ascertain the existence of alleged facts reported by a representative of the General Land Office, because of which the title of one claiming public lands is questioned in the Department. The Register and Receiver, after hearing the parties in interest, make report of their findings. These are subject to an appeal, on the evidence, to the Land Commissioner, and also to a further appeal to the secretary. Upon the ultimate findings, the Commissioner decides, subject to the supervision and control of the Secretary, what action, if any, shall be taken. Compare George W. Dally, 41 L. D. 295, 299. Circular No. 460, February 26, 1916, 44 L. D. 572, prescribes the procedure.

The proceedings here involved concern section 36, township 30 south, range 23 east, Mr. Diabolo B. & M.-that land being in Elk Hills, Kern county, Cal. Section 36 is one of the Sections in each township which, if not mineral or otherwise disposed of, was granted by Congress to the state of California in aid of public schools, by Act of March 3, 185o, c. 145, § 6, 10 Stat. 244, 246. Under patents issued by the state in 1910, and mesne conveyances, the Standard Oil Company claims title to part, and an interest in the rest, of the section. Drilling on this land, gegun in 1918, has been followed by extensive oilmining operations. The proceedings were based on a charge that on January 26, 1903, the date of the approval of the survey, the land was known to be mineral in character. If the land was then known to be mineral, the title confessedly did not pass by the act; for Congress excluded mineral land from the grant. Ivanhoe Mining Co. v. Keystone Consolidated Mining Co., 102 U. S. 167, 26 L. Ed. 126; Mullan v. United States, 118 U. S. 271, 276, 6 S. Ct. 1041 (30 L. Ed. 170). See, also, Wyoming v. United States, 255 U. S. 489, 500, 41 S. Ct. 393 (65 L. Ed. 742); Work v. Louisiana, 269 U. S. 250, 257, 258, 46 S. Ct. 92 (70 L. Ed. 259). If it was not then known to be mineral, the legal title passed to the state on that date; for the land was within one of the sections in place designated in the granting act. United States v. Morrison, 240 U. S. 192, 36 S. Ct. 326, 60 L. Ed. 599; United States v. Sweet, 245 U. S. 563, 38 S. Ct. 193, 62 L. Ed. 473.

The act of 1853 here involved, like those granting school lands to many other states,¹ makes no provision for determining what part of the land is thus excluded from the grant. It does not provide for the issue of patents or for any equivalent action by the Department to evidence the transfer of title to the state. No partent to the state, or evidence of title or interest in another, has in fact been issued by the Secretary of the Interior. Nor has there been in the Department any contest between the state and another claimant which might have resulted in a determination of the character of the land. Whether this land was known to be mineral at the date of the survey must therefore be established otherwise. The Standard Oil Company contends that its nonmineral character had, before Secretary Work's order, been established by a final determination in the Department; that thereby the Department lost jurisdiction over the land; and that, for this reason, continuation of the proceedings should be enjoined.²

It is true that among the several officers of the Land Department action had repeatedly been taken having some relation to the charter of the land prior to the order of Secretary Work. The survey, which was approved January 26, 1903, returned it as mineral. In 1904, a special agent reported it as nonmineral. In 1908, it was temporarily withdrawn from agricultural entry pending examination and classification by the United States Geological Survey. In 1909, the Director of the Geological Survey classified it as oil land. In 1910, the Secretary recommended its withdrawal for a petroleum reserve, and the recommendation was approved by the President. In 1912, it was placed in Naval Petroleum Reserve No. 1. On January 14, 1914, the proceedings in the land office here involved were initiated. The papers having been mislaid or misfiled in the local office, the proceedings lay dormant; and process was not served until after March 2, 1921. Then the Register and Receiver were ordered by the Land Commissioner, under Secretary Payne, to proceed in accordance with circular No. 460. On June 9 1921, before further action thereon, Secretary Fall directed the Land Commissioner to dismiss the proceedings and notify all parties in interest of the dismissal.

On May 8, 1925, Secretary Work vacated Secretary Fall's order and directed the Register and Receiver to proceed to a hearing of the charge that the land was known to be mineral in character on January 26, 1903.³ If at the time of Secretary Work's order the Department still had jurisdiction of the land, he possessed the power to review the action of his predecessor and to deal with the matter as freely as he could have done if the dismissal of the proceedings had been his own act or that of a subordinate official. For, so long as the Department retains jurisdiction of the land, administrative orders concerning it are subject to revision. New Orleans v. Paine, 147 U. S. 261, 13 S. Ct. 303, 37 L. Ed. 162; Beley v. Naphtaly, 169 U. S. 353, 364, 18 S. Ct. 354 (42 L. Ed. 775); Lane v. Darlington, 249 U. S. 331, 39 S. Ct. 299, 63 L. Ed. 629; Parcher v. Gillen, 26 L. D. 34; Aspen Consolidated Mining Co. v. Williams, 27 L. D. 1. Compare Louisiana v. Garfield, 211 U. S. 70, 75, 29 S. Ct. 31 (53 L. Ed. 92). If, on the other hand, either Secretary Fall's order of dismissal, or some earlier action of the government, terminated the jurisdiction of the Department, Secretary Work's order reinstating the proceedings was a nullity; and the Standard Oil Company is entitled to enjoin their continuance. Noble v. Union River Logging Railroad, 147 U. S. 165, 13 S. Ct. 271, 37 L. Ed. 123; Lane v. Watts, 234 U. S. 525, 34 S. Ct. 965, 58 L. Ed. 1440; Burke v. Southern Pacific R. Co., 234 U. S. 669, 686, 34 S. Ct. 907 (58 L. Ed. 1527).

In support of its contention that the jurisdiction had ended, the company relied bill upon two earlier acts of the Department, besides Secretary Fall's order, as constituting a final determination that the land was not known to be mineral at the date of the approval of the survey. The Supreme Court of the District did not pass on the legal effect of the two other acts. Upon the stipulated facts it ruled and found: (1) That Secretary Fall had jurisdiction to determine the known mineral character of section 36, without awaiting the trial by the local land office and appeals from the findings there made. (2) That the Secretary granted a hearing before himself for the purpose of determining the issues raised by the proceedings and gave notice to all parties in interest of such hearing. (3) That he had before him evidence which he had a right to consider and which supported his dismissal of the proceedings. (4) That he dismissed the proceedings after a consideration of the law and facts and directed that the parties in interest be notified of the dismissal and that the case be closed on the records. (5) That the order of dismissal was reduced to writing by his direction and was a judicial determination of the known mineral character of the land on January 26, 1903. (6) That the order of dismissal reduced to writing was a judgment on the merits, and its correctness could not be questioned by collateral proceedings, except for fraud. A decree for a permanent injunction was entered. That decree was affirmed by the Court of Appeals of the District. Work v. Standard Oil Co., 57 App. D. C. 329, 23 F. (2d) 750. This Court granted a writ of certiorari, 276 U. S. 613, 48 S. Ct. 325, 72 L. Ed. 731.

Ordinarily, where an act granting public lands excludes those known to be mineral, the determination of the fact whether a particular tract is of that character rests with the Secretary of the Interior. See Cameron v. United States, 252 U. S. 450, 464, 40 S. Ct. 410 (64 L. Ed. 659); Burke v. Southern Pacific R. Co., 234 U. S. 669, 684, 687, 34 S. Ct. 907 (58 L. Ed. 1527). But compare Dunbar Lime Co. v. Utah-Idaho Sugar Co. (C. C. A.) 17 F.(2d) 351. If such act provides for the issue of a patent, whether it be to pass the title or to furnish evidence that it has passed, the patent imports that final determination of the nonmineral character of the land has been made. The issue of the patent terminates the jurisdiction of the Department over the land. See Barden v. Northern Pacific R. R., 154 U. S. 288, 327, 331, 14 S. Ct. 1030 (38 L. Ed. 992); Courtright v. Wisconsin Central R. R. Co., 19 L. D. 410; Heirs of C. H. Creciat, 40 L. D. 623. And in the courts the patent is accepted, upon a collateral attack, as affording conclusive evidence of the nonmineral character. St Louis ...