Honorable Jerry Sadler Opinion No. W-1467 

Commissioner 

General Land Office Re: Whether the Commissioner 

Austin, Texas of the General Land Office 

should collect certain 

annual rentals on oil and 

gas leases as provided in 

such leases, which provisions are in conflict with 

Dear Mr. Sadler: Article 5344, V.C.S. 

The 1917 predecessor of Article 5344, Vernon's Civil 

Statutes, provided for the paymenit of $2.00 per acre annual 

rental on certain State mineral leases. In 1925, the act was 

amended so as to provide, as interpreted by the Texas Supreme 

Court In State v. J. M. Huber Corporation, 145 Tex. 517, 199 

S.W.2d 501 (1947) that only the down payment of $2.CO an 

acre and one rent:1 payment of $2.00 an acre at the beginning 

of the second year of the lease would be due. Under the said 

decision, no further rental was due for the remaining years 

of the lease. 

You state that a number of leases Issued under Article 5344, as amended In 1925, are still in effect. The 

leases, however, call for annual rentals as authorized under 

the 1917 law. Thus, the provision In the leases appears to 

be In conflict with the statute, as such statute was interpreted by the Supreme Court In the Huber case. 

You request an answer to the following question: 

"Should I, as Commissioner of the 

General Land Office, require the holder 

of such a lease to pay an annual rental 

of $2.00 per acre in conformance with 

the .terms of the lease on the theory 

that the contract controls in spite of 

the 1925 statute?" 
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Honorable Jerry Sadler, page 2 (ww-1467) 

The Huber case was 

the claimed an-rentals. 

a suit by the State to collect 

its opinion In the case, 193 

The Court of Civil Appeals In 

s.w.2d 882, 883, stated: 

11 It is conceded by all parties, 

however,'that the language of the statute 

in force at the time, authorizing execution of such lease and prescribing Its 

terms, is to be read into and deemed to 

be a part of the lease." 

The State contended that the amended statute provided for 

annual rentals. Roth high courts accepted the admission of 

the parties as stated above and, after interpreting the statute as not authorizing annual rentals, ruled against the 

State. Raising the question for the first time in ,the Supreme 

Court, the State sought recovery on the lease contract provision for annual rentals, even though same was in conflict with 

the statute. The Supreme Court held that as a reviewing court, 

it "would not be authorized to consider the question," since 

the lower courts had not had an opportunity to consider it. 

In Empire Gas and Fuel Company v. State, 121 Tex. 

138, 47 S.W.2d 2bb, 266 (1932), the Court said: 

"It is a rule in this State that, 

where contract is made, like the one under 

consideration, with reference to the 

performance of certain acts prescribed by 

statute, the contract and statute will be 

considered together. . . ." 

The rule Is thus stated In Langever v. Miller, 124 

Tex. 80, 76 S.W.2d 1025, 1026 (1934): 

"The laws, at least as to substantial 

rights and remedies, existing at the time 

a contract is made, become a part of the 

contract." 

To the same effect see Stanolind Oil and Gas Company 

v. Terrell, 183 S.W.2d 743, 744 (Civ.App. 1944, error ref.); 

Farmer's State Rank v. Brasoria County, 275 S.W. 1103 (Clv.App. 

1925, error ref. in 278 S.W. 177). 
. - 

Honorable Jerry Sadler,~pa&3 (WW-1467) 

Since the statute is deemed a part of the contract 

Itself, the result is that we have conflicting provisions 

within the contract. At least, there is a conflict to the 

extent that, the statute having fixed the rental at a set 

amount, there Is, in our opinion, an implied prohibition 

against charging a greater (or smaller) amount. Otherwise, 

the fixing of the amount by statute would be meaningless. 

We regard as very ersuasive the case of Gulf C. 

& S.F. Railway Co. v. Hume, 87 Tex. 211, 27 S.W. Ilo*), 

wherein the court says that It is 

"settled by the authorities that 

an officer cannot contract to receive 

compensation ,for services in addition 

to those prescribed by law. . . . This 

is placed upon the ground that, the 

compensation being prescribed by law, 

It is against public policy that it 

should be the subject of ctntract between 

the officer and litigants. 

In Gorman v. Gause, 56 S.W.2d 855 (Comm.App. 1933), 

It is said to be "uniformly held by the decisions~ of our 

courts that a contract cannot impair the validity of any law." 

Citing numerous authorities. 

And see Laird v. Brown, 210 S.W.2d 276, 279 (Civ. 

App. 1948); King v. Matney, 259 S.W.~2d 606, 609 (Clv.App. 

1953, error ref., n.r.e.). .,, 

We are of the opinion that the annual rentals provided for in the leases under consideration over and above 

those authorized by Article 5344 may not be collected. We 

accordingly answer your question In the negative. 

SUMMARY 

Where State oil and gas leases 

issued under Article 5344, V.C.S., provide for additional rentals over and 
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Honorable Jerry Sadler, page 4 (W-1467) 

above those authorized by the statute, 

the Commissioner of the General Land 

Office 1s not authorized to collect 

such additional rentals. 

Yours very truly, 

WILL WILSON 

Attorney General of Texas 

JAS:afg 

APPROVED: 

OPINION 'COMMITTEE 

W. V. Geppert, Chairman 

Ben Harrison 

Morgan Nesbitt 

Pat Bailey 

Cecil Rotsch 

REVIEWED FOR THE ATTORNEY GENERAL 

BY: Leonard Passmore