Court Opinion

ID: 6911023
Source: CourtListenerOpinion
Date Created: 2022-07-23 22:22:10.808071+00
Date Added: 2024-06-11T16:06:30.013494
License: Public Domain

PICKETT, Circuit Judge
(dissenting).
In Oklahoma, when school lands are sold under deferred payment contracts, the legal title remains in the State, but the equitable title is conveyed to the purchaser who is entitled to the possession, rents, and profits. He is the owner against the world, except the State. Stevens v. Patten, 174 Okl. 582, 50 P.2d 1106. He becomes the owner of the land, subject to the lien of the State for the deferred payments. 64 Okl.St.Ann. § 187; First Nat. Bank of Butler v. Welch, 119 Okl. 270, 250 P. 100. He may convey by deed an undivided interest in the land which is good against anyone acquiring legal title to the lands thereafter, if the deed has been duly recorded in the county where the land is located. Stevens v. Patten, supra. He may mortgage the land and one thereafter taking an assignment of the contract takes it subject to the mortgagelien if the latter has been properly recorded. Winter v. Schneider, 120 Okl. 299, 251 P. 609. He may by deed convey the minerals in and under the lands and the deed is good, if it has been duly recorded, against a subsequent assignee of the contract who has surrendered the original contract and obtained a reissue thereof. Berryman v. Producers Corp. of Nevada, 206 Okl. 24, 240 P.2d 1111; Johnson v. Farmers Union Co-op. Royalty Co., 205 Okl. 478, 238 P.2d 831. In all of these cases the conveyances by the purchaser were upheld, but in all of them the terms of the contract had been fulfilled and the contract owner was entitled to a patent.
*9It is apparent from the Oklahoma decisions that when school lands are sold under deferred payment contracts, the relation between the State, the contract owners, and those who acquire rights through the owners, is substantially the same as though the State were a private citizen and had sold the property by a contract of sale. It is conceded here that there was a default in the terms of the contracts and that all the rights of the original contract owners and their assignees were cancelled out. Magnolia held a deed to one-half the mineral rights in and under the lands which had been executed by the owner of the contract before cancellation. This deed had been duly recorded, and Magnolia contends that the State could not cancel its interests without notice. If Magnolia is not entitled to notice of cancellation under the statute or the contract, its rights were lost when the contract was cancelled because whatever interest it acquired in the property came through the contract. Magnolia was not in privy with the State and its remedies were limited to its transaction with the certificate holder.
Section 1 of Chapter 57 of the Session Laws of Oklahoma, 1923-4, provided that when a holder of a certificate of purchase shall be in default of deferred payments for a certain period, the Commissioners of the Land Office shall, “cause notice to be given all delinquent purchasers, or holders or owners of certificates of purchase”. It further provided that if such delinquent payments were not paid within ninety days from the date of the service of the notice, the Commissioners, “shall declare all rights obtained by the purchaser or transferee under said sale and the certificate of purchase issued thereon, forfeited to the State.” It will be noted that this section referred only to the notice which was to be given to delinquent purchasers, or holders or owners of certificates of purchase. Section 2 of the same Act dealt with the service of the notice which was required under Section 1, and stated that such notice, “shall be made by registered mail, to the record owner, or lien holder of record and to the person or persons in possession thereof.” It is evident that these sections were designed to provide a simple and expeditious method of clearing the state’s title to school land upon a default in the conditions of outstanding certificates of purchase by the certificate holders. Nowhere in the statute is there any indication that one acquiring an interest in the lands from the certificate holder is entitled to notice unless we construe the term “record owner” as used in Section 2 as applying to everyone who has recorded a conveyance. This would place upon the Land Commissioners the burden of searching the record before cancellation and serving notice upon all who appeared to have acquired an interest in the lands regardless of the nature of their interest.1 I think that if the Legislature had had this in mind it would have said so. Such a statutory construction, it appears to me, is a reasonable one, particularly when to hold otherwise will overturn an administrative interpretation of almost thirty years. Such administrative interpretation should be given great weight by the courts and should not be overturned without cogent reasons. Skelly Oil Co. v. Jackson, 194 Okl. 183, 148 P.2d 182; Lincoln National Life Insurance Co. v. Read, 194 Okl. *10542, 156 P.2d 368, affirmed 325 U.S. 673, 65 S.Ct. 1220, 89 L.Ed. 1861.
The fact that the owner of a mineral deed has good title against everyone except the State does not create an anomalous or untenable situation, because he cannot obtain a complete title until the obligations to the State under the contract are fulfilled.
Such an interpretation does not have any constitutional inhibitions. All rights obtained through the owner of the contract are contingent upon the fulfillment of the terms of that contract, and no vested interests are created in third parties in the property until the terms of the contract have been fulfilled. Asher v. Hull, 207 Okl. 478, 250 P.2d 866; Stuart v. Westerheide, 144 Okl. 150, 289 P. 721; Seguin v. Maloney, 198 Or. 272, 253 P.2d 252, 256 P.2d 514, 35 A.L.R.2d 1412; Clinton v. Miller, 124 Mont. 463, 226 P.2d 487; Peterson v. Paulson, 24 Wash.2d 166, 163 P.2d 830; California Delta Farms v. Chinese American Farms, 207 Cal. 298, 278 P. 227, appeal dismissed, 280 U.S. 520, 50 S.Ct. 67, 74 L.Ed. 590.
Only vested rights are protected by the Due Process Clause of the Constitution. 12 Am.Jur., Constitutional Law, Sec. 650. Magnolia had no vested right as against the State. Whatever title it had was contingent upon the performance of the contract by the certificate holder. See Pearsall v. Great Northern Ry. Co., 161 U.S. 646, 16 S.Ct. 705, 40 L.Ed. 838; Campbell v. Holt, 115 U.S. 620, 6 S.Ct. 209, 29 L.Ed. 483; Anderson-Prichard Oil Corp. v. Corporation Commission, 205 Okl. 672, 241 P.2d 363, appeal dismissed 342 U.S. 938, 72 S.Ct. 562, 96 L.Ed. 698; Crump v. Guyer, 60 Okl. 222, 157 P. 321, 2 A.L.R. 331; Fa-hey v. O'Melveny & Myers, 9 Cir., 200 F.2d 420, certiorari denied Mallonee v. Fahey, 345 U.S. 952, 73 S.Ct. 863, 97 L.Ed. 1374; United States v. Nebo Oil Co., 5 Cir., 190 F.2d 1003; Mizer v. Kansas Bostwick Irrigation District No. 2, 172 Kan. 157, 239 P.2d 370; Dunham Lumber Co. v. Gresz, 71 N.D. 491, 2 N.W.2d 175, 141 A.L.R. 60; 11 Am.Jur., Constitutional Law, Sec. 370.2
For the reasons stated, I would affirm the judgment.

. During the trial the District Court made this observation:
“Now, if you can take this conveyance of half interest, Mr. ISbenkamp can convey each acre to a different person. So when the State of Oklahoma, when the certificate holder hasn’t paid, goes to foreclose, they had to notify three hundred and twenty people. It would be practically impossible for them to foreclose their mortgage.
“In other words, this is a contract and it is a personal matter between the Commission and the man that they give it to. There are a lot of provisions as to who they can even do business with and they certainly, under the statute, have a right to choose their person or see that he meets certain requirements equally with all other citizens.”

. In United States v. Nebo Oil Co., supra, [190 F.2d 1008] the court said:
“True, there is no .rule or principle 'known to our system of the law whereby private property can- be taken from one person and conveyed to another for his 'private use and benefit. It is equally true that remedial legislation frequently has an effect upon the control and disposition of property. The principal re-strietion upon legislation of this nature appears to be that vested rights must not be disturbed. But many rights, privileges and immunities having to do with ownership under a specific state of the .law, cannot be regarded as vested rights. To be a vested right it must have become <n title, legal or. equitable, to the present -or future use and enjoyment-, of property.”