TEEATTORNEY GENERAL
OFTEXAS

Honorable George I-i? Sheppard Comptroller of FublfcAccounts Austin, Texas Dear Sir: OpfnIonNo. O-3013 " '~ Re: Delay rental on oil and gas leases on land purchased or condemned by the State for highwaypurposes. This will acknowledge raeceipt of your letter of Jan; uary 2, 1941,,

and your supplementalletter of January 11, 1941, inwhich you ask for an opinion of this departmentas to what should be done with delay rentals tendered to the State by oil companfesunoer the two following situations:

1. Where a landowner has executed an oil ana gas lease for a term of years provfaing for the payment of annual delay rentals and while said lease is outstandfng the landowner conveys to the Highway Department fee sfmple tftles to a portfon of hfs land,

"2, Where the 'FLHSghwag Department'condemns a portfon of the land covered by the lease for highway r4ght of way purposes.

It is the opfnfon of thfs department thatunder the first ,situation

above,where the Highway Department secures an outrightdeed in fee simple to a portIon of land coveredby an of1 and gau lease, that the delay rentals on the portion of the land purchased should be paid to that department,

A:rticle66::jal

Set, 1,Vernon's Annotated Texas Statutes, provides as foilo'ws:

'Whereverthe State Highway CommfssIonhasp acqufred or shall hereafter acquire any land by purchase, condemnatibn,or otherwise to be used as a right ofway for any State Highway~ana thereafter the route of such Highway was or shallbe changed or abandoned, and any such right ofway be no longer needed for suchHLghwag, ce needed foruse of citizens as a road, the State Hlghway CommfssFonmayHon. Geo. H. Sheppard, page 2 O-303.3

recommend to the Governor that such land be sold and that he execute a deeciconveying all the State's right, tftle and Interest in such land so acquired. Upon the recommendation of the Commission, the Governor may execute a proper deed conveying and/or excnanging'suchland for different land belonging to the same person OP peruons. It s'hall be~the duty of the Commission to fix the fair and reasonablevalue of all such land and advise the Governor ,thereof,'ProvQiedthatwhere such land is given to the State, the Governor may return the same bv proper deed to the person or persons from whom the-same Is the sale of such funds fromwhich Attorney General thisAct." receiveda ‘811money-derived from

land shall 'be

depositedwith the itwas originally taken. The shall approve ali tranufersunder

Since the land inquiredabout was purchasedwith the funds approprfnted to the HighwayDepartment, even though the delay rentalsdo not strictly constitute the sale prfce'of any land~previouslgheld by that department, t'he delay rental grew out of the tran.sac,tion of purchasemade by the'HlghwagDepartment 'insofar

Ei3 the State's in.tere3t is concerned,and in view of the above statute, it logically should be paid to that department,

It is the oprnion of this department, in answcrto the second Inquiryabove wfth respect to delay rentals on land con-'- demned by theHighwayDepartment for highway right of way'purposes under the rrght of eminentdomain, tha,? neither the HighwayDepartment nor any other branch of the State is entitled to such delay rental since the State would own no interest 'in the minerals, but only an easementwith a c;'Lght tou3e the surface for highway purposes.

In the case of Calvert, e't al v. Harrfs County, 46 S.W, (2d) 375, decided by ,the Coup':: of CivilAppea'ls

at Galveston, whereIn the defer&ant ln a conc:emna~!;icn suit by the county seekfng to cordarm certain of h1s 'landfo,:? roao purposes contended that he was enti~tlga,tothe value of ,?he mIneral under the land taken. The CtT;ii:'t II?ovez%ling his ~~orcter~tlonu used the following language:

"The se'iM:led

role is t&t Ln condemn.atfon proceedings only an easement is required and that such easement is a'11tha,t,the1a;i requires to be paid for."

This opinion is not to be cor:,strued as holding that under either of the two above situations that the 011 companyHon. Geo. H. Sheppard,page 3 O-3013

would be authorized to develop the land taken by theHighway Department for oil and gas purposes by operation on the property taken.
Yours very truly ATTORNEY GENERAL OF TEXAS

By s/3.0.Mahon D.D. Mahon Assistant
DDM:BT:wc

APPROVH) JAN 22, 1941 s/GroverSellers FIRST ASSISTANT ATTORNEY GENERAL Approved Opinion CommitteeBy s/BWB Chairman