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UNITED STATES v. LITTLE LAKE MISERE LAND CO.

decided: June 18, 1973.

UNITED STATES
v.
LITTLE LAKE MISERE LAND CO., INC., ET AL.



CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT.

Burger, C. J., delivered the opinion of the Court, in which Douglas, Brennan, White, Marshall, Blackmun, and Powell, JJ., joined. Stewart, J., post, p. 605, and Rehnquist, J., post, p. 606, filed opinions concurring in the judgment.

Author: Burger

[ 412 U.S. Page 582]

 MR. CHIEF JUSTICE BURGER delivered the opinion of the Court.

We granted the writ in this case to consider whether state law may retroactively abrogate the terms of written agreements made by the United States when it acquires land for public purposes explicitly authorized by Congress.

The United States initiated this litigation in 1969 in the United States District Court for the Western District of Louisiana, seeking to quiet title to two adjacent parcels of land in Cameron Parish, Louisiana, which the Government had acquired pursuant to the Migratory Bird Conservation Act, 45 Stat. 1222, 16 U. S. C. § 715 et seq., as part of the Lacassine Wildlife Refuge.*fn1 Title to one parcel was acquired by the United States by purchase on July 23, 1937; to the other parcel by a judgment of condemnation entered August 30, 1939. Both the 1937 act of sale and the 1939 judgment of condemnation reserved to the respondent Little Lake Misere oil, gas, sulphur, and other minerals for a period of 10 years from the date of vesting of title in the United States.*fn2 The reservation

[ 412 U.S. Page 583]

     was to continue in effect "as long [after the initial ten-year period] as oil, gas, sulphur or other mineral is produced . . . or so long thereafter as [respondents] shall conduct drilling or reworking operations thereon with no cessation of more than sixty (60) days consecutively until production results; and, if production results, so long as such mineral is produced." The deed and the judgment of condemnation further recited that at the end of 10 years or at the end of any period after 10 years during which the above conditions had not been met, "the right to mine, produce and market said oil, gas, sulphur or other mineral shall terminate . . . and the complete fee title to said lands shall thereby become vested in the United States."

The parties stipulated, and the District Court found, that as to both the parcels in issue here, no drilling, reworking, or other operations were conducted and no minerals were obtained for a period of more than 10 years following the act of sale and judgment of condemnation, respectively. Thus, under the terms of these instruments, fee title in the United States ripened as of 1947 and 1949, respectively -- 10 years from the dates of creation.

[ 412 U.S. Page 584]

     In 1955, the United States issued oil and gas leases applicable to the lands in question.

Respondents, however, continued to claim the mineral rights and accordingly entered various transactions purporting to dispose of those rights. Respondents relied upon Louisiana Act 315 of 1940, La. Rev. Stat. § 9:5806 A (Supp. 1973), which provides:

"When land is acquired by conventional deed or contract, condemnation or expropriation proceedings by the United States of America, or any of its subdivisions or agencies from any person, firm or corporation, and by the act of acquisition, order or judgment, oil, gas or other minerals or royalties are reserved, or the land so acquired is by the act of acquisition conveyed subject to a prior sale or reservation of oil, gas or other minerals or royalties, still in force and effect, the rights so reserved or previously sold shall be imprescriptible."

Respondents contended that the 1940 enactment rendered inoperative the conditions set forth in 1937 and 1939 for the extinguishment of the reservations. The District Court concluded that the Court of Appeals' prior decision in Leiter Minerals, Inc. v. United States, 329 F.2d 85 (CA5 1964), required resolution of this case in favor of respondents, notwithstanding that we had vacated the Court of Appeals' judgment in Leiter Minerals and remanded with instructions to dismiss the complaint as moot. 381 U.S. 413 (1965). The Court of Appeals affirmed, for the reasons stated in its Leiter Minerals holding. It rejected the Government's Contract Clause and Supremacy Clause objections on the authority of United States v. Nebo Oil Co., 190 F.2d 1003 (CA5 1951), and further rejected the Government's argument that Act 315 was unconstitutionally discriminatory against the United States. The Court of Appeals

[ 412 U.S. Page 585]

     observed "that the same principle applies to acquisitions by the State of Louisiana [La. Rev. Stat. § 9:5806 B], and that the act really does nothing more than place citizens of Louisiana in the same position as citizens of other states whose land has been purchased or condemned by the United States." 453 F.2d 360, 362 (1971). We reverse.

I

Litigation involving Act 315 began more than a quarter century ago. The Leiter Minerals case, upon which the Court of Appeals based its decision in this case, is only the principal holding in the area. The first case to arise involving Act 315, Whitney Nat. Bank v. Little Creek Oil Co., grew out of a 1932 sale of mineral rights that specified a 10-year period of prescription. The surface property was conveyed to the United States in 1936, subject to the 1932 mineral sale, and in 1947 the question arose whether Act 315 of 1940 had the effect of extending indefinitely the servitude created by the 1932 sale. The Louisiana Supreme Court held that Act 315 of 1940 was fully applicable to the 1936 transaction -- "not because there is anything in the terms of the statute to indicate that it was intended to have a retroactive application, but because of the general rule of law established by the jurisprudence of this court that laws of prescription and those limiting the time within which actions may be brought are retrospective in their operation." 212 La. 949, 958, 33 So. 2d 693, 696 (1947).*fn3 The court acknowledged the contention that if

[ 412 U.S. Page 586]

     Act 315 were applied retroactively, it might be unconstitutional, but dismissed the constitutional issue without resolving it for failure to join the United States, a necessary party.

Whitney Bank set the stage for the first federal court test of Act 315, as construed to have retroactive application, in United States v. Nebo Oil Co., supra, aff'g 90 F.Supp. 73 (WD La. 1950). There the United States brought suit against Nebo Oil (the successor to the 1932 mineral purchaser of the Whitney Bank case) to secure a declaratory judgment that the United States owned the acreage it purchased in 1936 subject only to the 10-year rule of prescription specified at the time of the original 1932 sale of mineral rights. But the Court of Appeals upheld the application of Act 315 to the previously consummated transaction, stressing that reversionary estates are unknown in Louisiana law and that, as a result, the United States in 1936 took "nothing more than a mere expectation, or hope, based upon an anticipated continuance of the applicable general laws . . . . [This] mere expectancy . . . cannot be regarded as a vested right protected by the Constitution." 190 F.2d, at 1008-1009.*fn4

[ 412 U.S. Page 587]

     In the Leiter Minerals litigation, retrospective application of Act 315 to a detailed, conditional mineral reservation was in issue for the first time. Leiter Minerals, Inc., succeeded to the interests of the Leiter family, which in 1938 had sold a substantial tract in Plaquemines Parish, Louisiana, to the United States. Leiter's federal sale was subject to a mineral reservation in Leiter's favor, providing in essence that the reservation would be extended for five years beyond its initial 10-year duration whenever commercially advantageous mineral extraction had occurred during 50 days of a defined period.*fn5 At the expiration of any period during which the conditions for extension had not been met, the right to mine would terminate "and complete fee in the land becomes vested in the United States." The mineral reservation expired by its own terms; the Government granted a valuable mineral lease; and Leiter invoked Act 315 to support its claim to a servitude of continuing duration.

After a false start in the Louisiana courts, the ensuing litigation found its way into a federal forum. The United States sued in the Eastern District of Louisiana to quiet title and to enjoin the concurrent state court proceedings initiated by Leiter. The Court of Appeals affirmed an injunction granted by the District

[ 412 U.S. Page 588]

     Court,*fn6 and this Court agreed, but remanded to the Court of Appeals with instructions to secure an authoritative construction of Act 315 before proceeding to the difficult constitutional issues in the case. Leiter Minerals, Inc. v. United States, 352 U.S. 220, 229 (1957).*fn7

Adhering to the terms of the remand, Leiter sought a declaratory judgment in the Louisiana courts, which expressed some continuing doubt over the breadth of their responsibility for resolving the Leiter controversy on its own facts. Ultimately, the Louisiana Supreme Court took jurisdiction of the case and rendered a declaratory judgment limited to general elucidation of Act 315, without applying the Act to the specific terms of the Leiter mineral reservation itself. Leiter Minerals, Inc. v. California Co., 241 La. 915, 132 So. 2d 845 (1961). The Louisiana Supreme Court expressed its conclusions as follows:

"First, that if the reservation in the Leiter deed is construed as establishing a mineral servitude for a definite, fixed, and specified time which has elapsed, then Act 315 of 1940 is not applicable and cannot be constitutionally applied; and second, that if the reservation is construed as not establishing a servitude for a fixed, definite and certain time, and if

[ 412 U.S. Page 589]

     it is decided that the provisions of the reservation show that the parties were stipulating for a period of contractual prescription for the conditional extinguishment of the mineral servitude created, then Act 315 of 1940 is applicable and constitutional." Id., at 942, 132 So. 2d, at 854-855.

Recognizing that "the interpretation of this reservation is for the United States courts, and not for us in this proceeding," id., at 930, 132 So. 2d, at 850, that court nevertheless hinted broadly that it viewed the Leiter reservation as one establishing a reservation for an indefinite period of time, and thus one subject to ...


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