RE: OWNERSHIP OF IMPROVEMENTS PLACED ON REAL ESTATE WHICH REVERTS TO GRANTOR; REQUIREMENTS UPON SALE OF REAL ESTATE BY MUNICIPALITY.
ATTORNEY GENERAL HENRY HAS ASKED ME TO RESPOND TO YOUR LETTER OF SEPTEMBER 8, 1989, REQUESTING AN INFORMAL OPINION REGARDING AND CONVEYED BY A MUNICIPALITY TO BE USED FOR A COUNTY HEALTH DEPARTMENT, SAID LAND REVERTING TO THE MUNICIPALITY IF IT CEASES TO BE USED FOR COUNTY HEALTH DEPARTMENT PURPOSES. YOUR QUESTIONS ARE:
1. WHEN THE PROPERTY CEASES TO BE USED FOR HEALTH DEPARTMENT PURPOSES, DOES IT REVERT BACK TO THE CITY ALONG WITH ANY IMPROVEMENTS THAT HAVE BEEN PLACED THEREON, OR ARE THE IMPROVEMENTS OR THE VALUE THEREOF SEVERABLE; AND
2. WITH REGARD TO THE REAL PROPERTY, IF THE MUNICIPALITY DECLARES SAID REAL PROPERTY TO BE SURPLUS, MAY THE MUNICIPALITY CONVEY THE REAL PROPERTY TO THE COUNTY FOR A NOMINAL VALUE OR IS THE CITY REQUIRED TO ADVERTISE SAID PROPERTY AND SELL IT FOR ITS HIGHEST AND BEST PRICE TO FULFILL THE FIDUCIARY DUTY OF THE CITY?
THE ANSWERS TO YOUR QUESTIONS DEPEND IN LARGE PART ON FACTS PECULIAR TO THE SITUATION DESCRIBED. NEVERTHELESS, I BELIEVE THAT THE FOLLOWING REMARKS, EVEN THOUGH THEY ARE ONLY MY OPINION, WILL BE OF SOME ASSISTANCE TO YOU.
FOR AN ANALYSIS OF YOUR FIRST QUESTION, THE STARTING POINT IS 60 O.S. 334 (1981), WHICH STATES IN PERTINENT PART: "WHEN A PERSON AFFIXES HIS PROPERTY TO THE LAND OF ANOTHER WITHOUT AN AGREEMENT PERMITTING HIM TO REMOVE IT, THE THING AFFIXED BELONGS TO THE OWNER OF THE LAND, UNLESS HE CHOOSES TO REQUIRE OR PERMIT THE FORMER TO REMOVE IT." IN THE SITUATION YOU DESCRIBE, THE COUNTY OWNS A DEFEASIBLE FEE WHICH IS SUBJECT TO A REVERSION OWNED BY THE MUNICIPALITY. AS A GENERAL RULE, BUILDINGS AND IMPROVEMENTS ATTACHED TO THE LAND BECOME PART OF THE REAL ESTATE AND WOULD GO TO THE OWNER OF THE REVERSION AT THE TERMINATION OF THE PRECEDENT ESTATE. HOWEVER, THE COURTS HAVE CREATED AN EXCEPTION TO 60 O.S. 334 WHEN THE IMPROVEMENTS HAVE BEEN PAID FOR WITH PUBLIC FUNDS. THE CASE OF SEWELL V. REINHARDT, 219 P. 2D 996 (OKLA. 1950), INVOLVED A SCHOOL BUILDING BELONGING TO AN INDEPENDENT SCHOOL DISTRICT ERECTED ON LAND DEEDED TO THE SCHOOL DISTRICT BY A DEED CONTAINING A REVERSION CLAUSE. THE DEED PROVIDED THAT THE TRACT WAS TO BE USED FOR SCHOOL PURPOSES ONLY, AND THAT WHEN IT CEASED TO BE USED FOR SCHOOL PURPOSES, IT SHOULD REVERT TO THE GRANTORS OR THEIR HEIRS. THE COURT DETERMINED THAT THE SCHOOL HOUSE DID NOT BECOME A FIXTURE AND PASS TO THE FORMER OWNER BY THE REVERSION CLAUSE BUT REMAINED THE PROPERTY OF THE SCHOOL DISTRICT.
THE COURT REASONED IN THE SEWELL CASE THAT ALLOWING THE BUILDING TO BECOME A FIXTURE AND REVERT TO THE GRANTOR WOULD VIOLATE THE OKLAHOMA STATUTES WHICH GAVE THE SCHOOL BOARD AUTHORITY TO SELL AND DISPOSE OF PROPERTY. THE COURT CITED AND FOLLOWED THE CASE OF DERIEG V. BOARD OF EDUCATION, 216 P.2D 307 (OKLA. 1950). THE DERIEQ CASE,