Honorable Jerry Sadler OpinionNo. 

### 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 conflictwith Dear Mr. Sadler: Article 

### 5344,V.C.S.

The 1917predecessor of Article 

### 5344,Vernon's Civil Statutes,provided for the paymenit of $2.00 per acre annual rental on certain Statemineral leases. In 1925, the act was amended so as to provide, as interpretedby the Texas Supreme Court In State v. J. M. Huber Corporation, 

### 145Tex. 

### 517,199 S.W.2d 501 (1947) that only the down payment of $2.CO an acre and one rent:1payment of $2.00 an acre at the beginning of the secondyear of the leasewould be due. Under the said decision,no further rentalwas due for the remainingyears of the lease.

You state that a number of leases Issuedunder Article 

### 5344,as amended In 1925, are still in effect. The leases,however, call for annual rentals as authorizedunder the 1917 law. Thus, the provision In the leasesappears to be In conflictwith the statute,as such statutewas interpreted by the Supreme Court In the Huber case.

You request an answer to the following question: "Should I, as Commissionerof the General Land Office, require the holder of such a lease to pay an annual rental of $2.00 per acre in conformancewith the .termsof the lease on the theory that the contract controls in spite of the 1925 statute?". \

Honorable Jerry Sadler,page 2 

### (ww-1467)

The Huber casewas 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 concededby all parties, however,'that the languageof 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 statuteprovided for annual rentals. Roth high courts accepted the admission of the parties as stated above and, after interpretingthe statute as not authorizingannual rentals, ruled against the State. Raising the question for the first time in ,theSupreme Court, the State sought recovery on the lease contractprovision for annual rentals, even though samewas in conflictwith the statute. The Supreme Courtheld that as a reviewing court, it "wouldnot be authorized to consider the question," since the lower courtshad not had an opportunity to consider it.

In Empire Gas and Fuel Companyv. 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 actsprescribed by statute, the contractand statutewill be considered together.

. . ." The rule Is thus stated In Langeverv. Miller, 124 Tex. 80, 

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

"The laws, at least as to substantial rights and remedies, existingat 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 

### 278S.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 conflictingprovisions within the contract. At least, there is a conflict to the extent that, the statutehaving fixed the rental at a set amount, there Is, in our opinion, an impliedprohibition against charging a greater (or smaller)amount. Otherwise, the fixing of the amount by statutewould 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

"settledby the authorities that an officer cannot contract to receive compensation ,forservices in addition to thoseprescribed by law.

. . .This is placed upon the ground that, the compensationbeing prescribedby law, It is againstpublic policy that it should be the subject of ctntractbetween the officer and litigants. In Gorman v. Gause, 

### 56 S.W.2d 855 (Comm.App.

### 1933), It is said to be "uniformlyheld 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 rentalsprovided for in the leasesunder considerationover and above those authorized by Article 

### 5344may not be collected. We accordingly answer your question In the negative.

SUMMARY Where State oil and gas leases issuedunder Article 

### 5344,V.C.S., provide for additional rentals over and- .

Honorable Jerry Sadler, page 4 

### (W-1467)

above those authorizedby the statute, the Commissionerof 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