Document: 338 U.S. 621 70 S.Ct. 392 94 L.Ed. 393 CHAPMAN, Department of Interior,v.SHERIDAN-WYOMING COAL CO., Inc. No. 60. Argued Jan. 9, 1950. Decided Feb. 6, Mr. Roger P. Marquis, Washington, D.C., for petitioner. T. Peter Ansberry, respondent. Justice JACKSON delivered the opinion Court. 1 This action by a lessee coal-mining rights in public lands seeks to prevent leasing similar other competitor. The case is before us only on pleadings. original complaint was dismissed District Court several grounds but Appeals affirmed ground that showed no standing sue, there being allegation special injury any property right plaintiff. Sheridan-Wyoming Coal Co. v. Krug, 83 U.S.App.D.C. 162, 168 F.2d 557. It gave leave apply amend this respect. denied privilege, however, holding proposed new matter added nothing material, and amendment would be idle needlessly prolong litigation. This, we think, equivalent effect sustaining demurrer amended requires treat well pleaded facts as true. On basis, reversed and, substance, held does state cause action. 84 288, 172 282. We granted certiorari. 810, 54. 2 hypothesis which legal issues are decided this: 3 At all relevant times following regulation, promulgated Secretary Interior, has been effect: 'Showing reguired an additional coal mine needed. General Land Office will make favorable recommendation units segregated auctions authorized cases where furnished satisfactory showing needed actual need cannot otherwise reasonably met.' 43 CFR 1938, § 1933. 4 originated 1934, when industry demoralized excess production capacity described opinions Appalachian Coals, Inc., United States, 288 344, 361, 53 471, 474, 77 825; Carter Co., 298 238, Cardozo, J., 324, 330, 56 855, 878, 881, 80 1160; Sunshine Anthracite Adkins, 310 381, 395, 60 907, 913, 1263. policy embodied it since adhered, stated letters set forth margin.1 5 In September, 1943, Company leased located Wyoming mining purposes from Government 'in reliance upon Regulation,' expended large sums development built up prosperous business rather low-grade mined largely consumed region. 6 December, Big Horn applied lease nearby competitive coal, 1945 lands. Meanwhile already had established mines partially exhausted state-owned desired federal its business. Company, among others, protested basis regulation. protest, after hearings, overruled unless prevented, Horn. made finding supply fact, such need. If he leases Horn, two companies have produce demand grade limited market. investment substantially impaired volume sales decreased profitable markets lost. About these three ultimate facts—the threatened competitor—the parties argued intricate interesting questions plaintiff whether suit really one against States without sovereign consent abused his power entertaining application These do not discuss because view take more fundamental aspects case. think give rise action, breach contract or invade violate law. Hence, within discretionary courts review exercise. 7 I. Contract Rights. 8 court below sustained principal reason involved withheld lease. 9 rights, created contract, sue; for, if truly said (172 282, 288), 'The prevention restrictive provision equity's most usual functions.' Credited with 'the status claiming invasion,' termed 'possessor valuable right, presence valid binding regulations.' 10 Of course, express covenant plaintiff's restricts applicants. sought supplied implication. lease, reasoned, expressly subject Mineral Leasing Act, 41 Stat. 437, amended, 30 U.S.C. §§ 181 et seq., U.S.C.A. seq.; constructively includes statute; regulation referred nevertheless force sanction hence, For purpose testing contract-right theory, shall assume so. 11 What assumed? nondevelopment reserves indeterminate substantial part domain benefit own necessary fullest physical enjoyment acquired itself, normally appurtenant real estate. assumed purely negative character whole burden premises owned interest. They premises, moreover, doubtful could lawfully acquire interest areas statute allows lessee. By covenant, alienation utilization manner Congress restricted. unstated indeterminable period. And accomplished expressed read into regulations. 12 A competent grantor appropriate covenants could, convey claimed here, equity enforce it. But 'consists restraining owner doing with, upon, which, grant might done,' easement, sometimes called amenity. Trustees Columbia College Lynch, N.Y. 440, 447, 26 Am.Rep. 615. 'An equitable restriction,' prevents building it, 'an servitude nature easement,' 'right 'interest contractual stipulation their common benefit.' Such 'equitable restrictions' estate, parcel land they attached pass conveyance. River-bank Improvement Chadwick, 228 Mass. 242, 246, 117 N.E. 244, 245, L.R.A. 1918B, 55. restriction limits use may favor another 'sometimes dominant tenement restrict servient exercise general natural property.' can deed every sense incumbrance. Uihlein Matthews, 154, 158, 64 792, 793. 13 whatever determine technical collateral result Sheridan's extent incumbrance subtraction aggregate States. Courts lightly imply There even stronger reasons implied imposing easements, servitudes, amenities restrictions 14 Acts confer broad powers agent Government. find him taking consideration served injured opening particular mine. authority create private override continuing duty governed deciding withhold leases. 15 strictly limit area acquire, either directly indirectly. 184, 184. if, permitted allotment lands, far extensive must lie fallow unused acquiring prohibited worth many him. purchase price, rental, royalty. 16 Moreover, monopoly. little one, advantageous shipping zone. gets eventually go out business, leaving customers Sheridan. some period—we know how long—admit competitor field, shown equal may, continue approach exhaustion. claim damage here competition impair snug monopoly market thinks right. 17 looks way. Besides limiting leasehold lessee, mineral pain forefeiture, passing hands unlawful trust becoming conspiracy restraint trade. Its seems contemplate exploitation. nowhere authorizes anyone obtain exclusive access resources. lessees say withhold, provide withholding, injured, through impairing capacity. freeze irrevocable 18 allegations therefore show statute. II. Violation Law Regulation. 19 Since latter's theory earlier insufficient, questioned sustain judgment availed of. fail protect, sufficient interest, enable raise question violation law leasing. To end litigation pending too long, assume, deciding, issue now consider. 20 proposing pursuant Act hence having That binds others while doubted. 21 literal reading purport prohibit shown. direct (now Bureau Management) recommending recommendation, advisory disregarded. face, therefore, seem directed primarily procedural Interior. However, Ickes at time adopted uniform practice since, fixing controlling policy. proceed assumption. 22 neither repudiates nor stands depart He says that, properly construed, introduce filed not, says, existing continue. Sheridan argues reasoning sanctions evasion opened depleted knowing get also quit. implication were used sort portal stand prying under Plaintiff insists required act light conditions first applied, going inadequate leases, aided war conditions. 23 equity, 'equity administer relief exigencies close trial.' Bloomquist Farson, 222 375, 380, 118 856; Lightfoot Davis, 198 261, 273, 91 582, 586, 29 L.R.A.,N.S., 119, 139 Am.St.Rep. 817, Ann.Cas. 747. injunction takes place complaint. pleads findings what happened filed. Without recourse face competition. improved Horn's position respect, noted delay acting due protests litigations. 24 term unreasonable mine,' proved. add uses them keep there. distinction Secretary's interpretation permissible, inevitable. declining growing oil present difficult problems survival government fair dealing Secretary. intervene invaded violated. 25 rightly concluded fails asked. Accordingly, reversed. Reversed. 27 DOUGLAS took decision 'Exhibit 'A' 'Excerpt From Letter January 24, Interior Director Geological Survey. advisability withholding presented me. 'It clear language section February 25, 1920 (41 437 (30 201, 202)), given Section 221), relating gas, Supreme ex rel. McLennan Wilbur, 283 414, 51 502, 75 1148, prospecting permits. situation desirable very few, any, permits issued. 'Taking consideration, small local needs advisable should denied, thought order issued suspending operation believed same reached offer purchased obtained * 'Hereafter offering bidding granting recommended you reliable information 'B' Commissioner Office. 'In obtained. instance require applicants fully coal.'

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