Ohio Oil Co. v. Giles (235 S.W.2d 630, 1950)

SPIARP, Justice.

The Ohio Oil Company and Melben Oil Company, relators, seek by this original mandamus proceeding to compel Bascom Giles, Jesse James, and R. S. Calvert, respondents, to refund to relators the sum of $123,360, paid by relators to Bascom Giles, and that he be ordered to recognize certain mineral leases as valid and subsisting, without the payment or necessity to pay any rentáis for the period during which such leases may be held between the commencement of the litigation and ten months and sixteen days, or, in the alternative, five months and twenty-one days after the rendition of a final judgment by the Supreme Court of the United States in the case of United States v. Texas, and that respondents be ordered to recognize that the primary term of such leases will run for a period of three years, ten months, and sixteen days after the rendition of such final judgment, or, in the alternative, for three years, five months, and twenty-one days after the rendition of such judgment.

As a basis for this action, relators allege that Bascom Giles is the Commissioner of -the. General Land Office of the State of Texas, Jesse James is the State Treasurer of the State of Texas, and R. S. Calvert. is .the Comptroller of Public Accounts of the State of Texas; that Jesse James now has in his possession, in a suspense account, $123,360 belonging to relators, which he is obligated under the laws of Texas to refund to them, but which he has failed and refused to do; that such sum of money was delivered to Bascom Giles, who unlawfully required relators to pay it to him on November 7, 1949, for the annual rental on 123,360 acres of submerged lands in the Gulf of Mexico on which re-lators own the oil and gas leasehold estates; that at the time Giles required re-lators to pay the annual rentals in order to avoid a forfeiture of the oil and gas leasehold estates, no rental was actually due and owing under the laws of -the State of Texas, because the obligation of relators to pay the rentals was under Article 5421i, Vernon’s Ann.Civ.St., suspended and set at rest during the pendency of United States v. Texas, which was an action brought by the United States on December 21, 1948, against Texas in the Supreme Court of the United States to recover title to or paramount rights in and dominion over the submerged lands and minerals in the Gulf of Mexico within the boundaries" of Texas, including -the lands and minerals on which relators were required by Giles to pay the annual rentals.

That relators are now the owners, in equal shares, of the oil and gas leasehold estates on 85 tracts of submerged lands in the Gulf of Mexico, aggregating in all 112,830 acres, and the owners of undivided interests in the oil and gas leasehold estates on twelve additional tracts of submerged lands in the Gulf of Mexico, aggregating in all 10,530 acres; and a description of the oil and gas leases and the tracts included therein is attached to rela-tors’ petition filed in this cause and marked Exhibit “A”; that each of the 89 leases described in Exhibit “A” was sold and awarded to the lessee therein named at a regular meeting of the School Land Board held in the General Land Office on the 7th day of November, 1947, after the Board had finally determined that the lessee had offered the highest and best bid for such land; that there is attached to the petition, and marked Exhibit “B”, a correct copy of one of the oil and gas leases described in Exhibit “A”, the remaining 88 oil and gas leases so described in Exhibit “A” were executed on a printed form similar in all respects to the oil and gas lease attached to the petition marked Exhibit “B” with some immaterial exceptions; that on August 2, 1948, relators agreed in writing with the Humble Oil & Refining Company, which owns an undivided one-half interest in four of the oil and gas leases, that they would pay on their own behalf and on behalf of Humble Oil & Refining Company all annual rentals that might become due on such four leases, and on February 3, 1949, agreed in writing with Stanolind Oil & Gas Company, which owns an undivided 56.9106 percent interest in eight of the tracts covered by the oil and gas leases thereon, that they would pay on their own behalf and on behalf of Stanolind Oil & Gas Company all annual rentals that might become due on such eight leases.

That neither oil nor gas has ever been produced from the submerged lands described in the 89 oil and gas leases, but relators paid to the Commissioner of the General Land Office, on or before the 7th day of November, 1948, the annual rentals therein provided 'for, in the aggregate sum of $123,360; that after relators had paid such annual rentals due on November 7, 1948, the United States filed in the Supreme Court of the United States on December 21, 1948, a motion for leave to file a complaint against the State of Texas; that the United States in the complaint set out in detail its claim to the lands involved in that suit, and it was alleged that the State of Texas claimed some right, title, or interest in the lands, minerals and other things adverse to the United States, and had negotiated and executed oil and gas leases with various persons and corporations in violation of the rights of the United States; that the lessees had paid to the State substantial sums of money in rents, royalties, and bonuses reserved under the leases, but that neither the State nor its lessees had recognized the rights •of the United States, nor had they paid to the United States either the value of the petroleum and other things taken from the area or the royalties therefrom; that in that suit the United States prayed that a decree be entered declaring the rights •of the United States as against the State of Texas, and enjoining the State af Texas and all persons claiming under it from continuing to trespass upon the area in violation of the rights of the United States, and requiring the State of Texas to account to the United States for all sums of money derived by it from the area involved subsequent to June 23, 1947.

That the State of Texas filed in the Supreme Court of the United States its objections to the motion of the United States for leave to file its complaint, but the Supreme Court on May 16, 1949,- granted leave to file the complaint; and the issue involved in that suit is whether the United States or the State of Texas is the owner in fee simple of the submerged areas in the Gulf o f the act involved here do not violate Article III, Section 55, of the Constitution of Texas. ■

Article 5421i relieves the lessees,'of the obligation to pay delay rentals during the suspended period, and respondents’ third counterpoint is overruled.

It appears that relators and respondents desire to leave the leases involved as they existed at the time of their execution, and that they be suspended as provided for in Article 5421i during the litigation of the case of United States v. Texas pending in the Supreme Court of the United States. In that case Texas has a motion pending in the Supreme Court of the United States which has not been acted upon, but relators are not parties in that suit. It is also suggested that an arrangement may be made between the United States and Texas with respect to the tidelands of Texas, and in that event the leases here would be recognized.

Relators contend that the suspension took effect on December 21, 1948, at which time the United States deposited with the Clerk of the Supreme Court its motion for leave to file its complaint against Texas. Respondents, on the other hand, contend that the suspension did not take effect until May 16, 1949, when the Court granted the United States leave to file the complaint. Since all issues except the payment of rentals have been eliminated in this case, relators having paid under protest the sum of $123,360 on November 7, 1949, makes it immaterial whether the suit was commenced on December 21, 1948, when the motion to file was presented to the clerk, or on May 16, 1949, when the Court granted leave for the petition to be filed. Under either theory the litigation 'was pending when relators paid the rentals under protest on November 7, 1949, and it is not necessary to decide the question when the suit was commenced, and neither do we decide the future status of the leases involved here between relators and the State.

The writ of mandamus will issue commanding Bascom Giles, R. S. Calvert, and Jesse James to refund to relators the sum of $123,360, the amount of rentals paid by relators to Bascom Giles under protest on November 7, 1949, for the ensuing year.