- ., 

E OENEY GENERAL 

TEXAS 

June 1, 1959 

Honorable Bill Allcorn Opinion No. WW-636 

Commissioner, Qeneral 

Land Office Re: Whether rentals were due 

Austlh 14, Texas December 4, 1958 on certain 

submerged lands leases ln,the 

Gulf of Mexico dated December 

4, 1953 if the lessees desired to have the running of 

primary terms suspended under 

Article 54211, VCS, and reDear Mr. CommlssionePt lated questions. 

In your opinion request you refer to the pending 

"Tidelands" litigation and to Attorney ffeneral's Opinion 

No. WW-540 regarding the suspension of leases covering 

submerged tracts In the Gulf of Mexico beyond three (3) 

geographic miles under the provisions of Article 54211, 

VCS, as amended.* 

You state: 

"A question' has now arisen concerning the 

payment of rentals on leases executed December 4, 

1953, which would have expired December 4, 1958 

but for the fact that the running of the primary 

terms thereof were suspended as of November 7, 

1957, " the date the suit was filed and which was 

approximately 13 months prior to the December 4, 

1958 rental date. 

In your opinion request after referring to Opinion 

No. WW-540, and setting forth certain facts, you propound 

three questions, which are in'substance: 

(1) In view of the commencement of litigation on 

November 7, 1957, were rentals due December 

4, 1958 on submerged lands leases in the Gulf 

of Mexico executed December 4, 1953 If the 

lessees desired to have the running of the 

*(Acts 1941, h7th Leg., p. 140~5, ch. 637, sec. 1, as 

amended Acts 1951, 52nd Leg., P. 750, ch. 406, sec. 1) 
. 

Honorable Bill Allcorn, Page 2 (Opinion No. WW-636) 

primary terms thereof suspended under the 

provisions of Article 54211? 

(2) If such rentals are not paid are such leases 

subject to forfeiture by the Commissioner 

under the provisions of Article 5372, VCS? 

(3) Is the primary term of such a lease (as well 

as obligations thereunder) suspended as to 

that portion lying more than three (3) geographic miles seaward from the ordinary lowwater mark or outer limit of inland water, 

as indicated in Opinion No. NW-540? 

You also state that paragraph 2 of each of the leases 

In question provides in part: 

"2 . On or before one year from the date of this 

lease and annually thereafter for each of the 

following years during the life of this lease, 

the lessee shall pay to the Commissioner of the 

General Land Office, Austin, Texas, an annual 

rental of Two Dollars ($2.00) per acre; provided 

that when royalties paid during any year during the 

life of this lease equal or exceed the annual 

rental, no annual rental will be due for the following year; otherwlse, there shall be due and 

payable on or before the anniversary date hereof 

Two Dollars ($2.00) per acre, less the amount of 

royalties paid during the preceding year." 

Your questions will be answered in sequence: 

In view of the commencement of litigation November 

7, 1957, were rentals due December 4, 1958 on submerged lands 

leases In the Gulf of Mexico axecuted December 4, 1953 if 

the leasues desired to have the ;,unning of the primar,' terms 

thereof suspended under the p&#cvisions of Article ,42li? 

Rentals were due on Decembe-~ 4, 1958 on leases 

dated December +, 1953 if the lessees desired to &ve the 

primary terms suspended .tnder Article 54211, VCS. 

You ytate In substance that some of tlie lessees 

take the position that no rentals were due December 4, ~$58 
Honorable Bill Allcorn, Page 3 (Opinion No. W-636) 

because Article 54211 refers to rentals which "accrue" 

during the period of litigation and that since-rental 

payments have been made no further rentals will "accrue' 

during the litigation, and therefore the leases are to 

remain in effect without further payment. In our opinion 

that view fails to take into account the further and decisive wording of the statute which is underscored below: 

"Provided further, that the lessee shall pay 

all annual delay rentals and any royalties which 

accrue during the period of litigation the same 

as during any other period of the extended primary term." 

In our opinion the statute requires rental payments not only during, but after, the primary term in 

consideration for keeping the lease alive but suspended. 

Otherwise, the phrase "during any other period of the 

extended primary term" would be meaningless. 

A statute should be construed so as to accomplish 

a purpose or result, and the object of statutory construction is to enforce and give effect to legislative intent. 

(39 Tex 5ur ,&atuteg Sec. 87, p. 160 et seq.) Here, the 

intent is expressed plainly. 

"Extended" both by court decisions and dictionary 

definition means to stretch or draw out; to lengthen or p-olow, either in spa-e or time; to protrac;, or to continue 

(Webs;erts New Internatio.>al Dictionar?r. 2nd Edition, Una- 

$%E;; ~0. K & T K C fT kex& & N 0 Rv. Co '. * 17L 

; ti..jhing v. In&.b~tan~~'o~*Town of LA.,ie H' 

2d 330, l-48 Me. 24,; State v. Zozzaro, 20 At1 2d 

Conn. 169; West Madison Stat, Bank v. Mudd, 250 Ill. A 

258; dane namelware Comoan v. Smi~L.+ 168 Tenn. 203, 

S.W.2d 644 

Loeffler v. 

d, 92 At1 

73i, 128 

.PP. 

76 

,v 18 

'.2d %62. 

In enacting Article 54211, as amended, it is apparent that the Legislature had in mind the fact that litigation can be protracted. It was providing for the eventuality 

that the litigation could well extend beyond the primary term, 

but, for the protection of the State it provided for a continuance in the payment of rentals during the extended term, 

and for the protection of the lessees it provided for the 

rentals to be held in suspense and subject to refund to the 

lessees if the State was unsuccessful in the litigation. It 

is difficult to conceive how the Legislature could have enacted a more just statute protecting, as it does, both the 

State and the lessees. 
Honorable Bill Allcorn, Page 4 (Opinion No. W-636). 

Paragraph 2 of the leases, quoted above, evidences 

that the Land Commissioner followed the Legislative intent, 

and the lessees are, of course, bound by the terms of the 

leases they received. That paragraph refers to the "life" 

of the lease. Under the circumstances the "life" of the 

lease can be extended by compliance with Article 54211. If 

the lessees choose not to pay the annual rental (which does 

not appear to be an "annual delay rental" in the traditional sense) to effectuate the suspension then the leases 

may be forfeited. 

(2) 

If such rentals are not paid are such leases subject to forfeiture by the Commissioner under the provisions 

of Article 5372, VCS? 

ANSWER: 

Assuming that the leases In question were executed 

under and by virtue of Title 86, chapter 4, RCS, then if 

the rentals referred to were not paid such leases are subject to forfeiture by the Commissioner under the provisions 

of Article 5372, VCS (Acts 2nd C.S. 1919, p. 249) for the 

reasons set forth in our answer to question No. 1. 

(3) 

Is the primary term of a lease (as well as obligations thereunder) suspended as to that portion of a lease 

lying more than three geographic miles seaward from the 

ordinary low-water mark or outer limit of inland waters, as 

indicated in Opinion No. W-540? 

ANSWER: 

If a portion of a lease lies more than three (3) 

geographic miles seaward from the low-water mark or from 

the outer limits of inland waters oi'f the coast of Texas, 

and a portion lies landward of that line, the obligations 

of the lessees, under Article 54211, are not suspended as 

to the portion lying landward of that line, but the primary 

terms and other lease obligations are suspended as to that 

portion lying seaward of such line except that the lessees 

must continue to pay annual delay rentals or royalties on 

the seaward portion. The statute in question reads in part 

as follows: 

oil, gas 

"The running of the primary term of any 

or mineral lease. . .which may hereafter 
Honorable Bill Allcorn, Page 5 (OpInionNo. NN-636) 

become involved in litigation. . .shall be 

suspended, and all obliaatlons imposed by such 

leases shall be set at rest during the period 

of such litigation . . *provided. . .that the 

lessees shall pay all annual delay rentals or 

any royalties which accrue during the period 

of litigation. . .' (Emphasis supplied.) 

SUMMARY 

As to submerged lands leases in the 

Gulf of Mexico involved in the "Tidelands" 

litigation* as to which four prior rental 

payments had been made and which would 

have expired December 4, 1958, but for the 

fact that about 13 months prior thereto 

the running of the primary terms was conditionally suspended under Article 54211 

as of November 7, 195 

lands" suit was filed 7 

, (date last "Tidesuch leases could 

be continued in effect during the lltigaWon under that Statute if, and only If, 

such lesseesmade annual rental payments 

December 4, 1958 and continue to make 

annual rental payments in tue future during 

the period of litigation (whether during, 

or after, the ordinary primary terms of the 

leases ) throughout the period of the 'extended' primary terms. Non-payment of such 

rentals subjects the leases to forfeiture 

by the Commissioner under Article 5372, 

vcs. If a portion lies more than three (3) 

geographic miles seaward from the ordinary 

low-water mark or from the outer limits of 

inland waters off the coast of Texas in the 

Gulf of Mexico, and a portion lies landward 

of that line, the obligations of the lessee 

(under Article j&211, 3s amended) are not 

suspentied as to the portion lying landward 

of that line, but the primary term and other 

lease obligations are suspended as to that 

portion lying seaward of such line except 

* (United States v. Louisiana, et al, U.S. Sup. Ct. No. 10 

Original, October Term 1958, now set for argument October 

12, 1959.) 
Honorable Bill Allcorn, Page 6 (Opinion No. WW-636) 

the lessee must continue to pay rentals and 

royalties on the seaward portion as stated 

in Opinion No. WW-540, to which reference is 

here made. 

Very truly yours, 

WILL WILSON 

Attoqey General of 'Texas 

v -.- 

S N. LUDLUFi-- 

V First Assistant 

JNL:bct 

APPROVED: 

OPINION COMMITTEE: 

Geo. P. Blackburn, Chairman 

James H. Rogers 

Grundy Williams 

John Wildenthal, Jr, 

APPROVED FOR THE ATTORNEX GENERAL 

By: W. V. Geppert