Court Opinion

ID: 4136732
Source: CourtListenerOpinion
Date Created: 2017-02-18 02:16:56.316918+00
Date Added: 2024-06-11T14:42:36.083076
License: Public Domain

THE         ORNEY           GENERAL

                       August   30,    1957

Hon. Earl Rudder                      Opinion No. WW-248
Commissioner
General Land Office                   Ret     Whether the descrip-
State of Texas                                tion of land contained
Austin 14, Texas                              in an advertisement for
                                              bids fop mineral lease
                                              controlsover an ambi-
                                              guous description con-
                                              tained in a lease execu-
                                              ted subsequent to an
                                              award to the successful
Dear Sir:                                     bidder.
       Your request .forofficial op:nion, dated July 24,
1957, is based upon the factual situation briefly outlined
below:
       On December 3, 1946, the School Land Board advertised
for oil and gas lease a portion of the Canadian River as
"Tract 1, Canadian River bed, contalning approximately 1742
acres (see sketch ;itta.&&)"D The sketch referred to clearly
discloses the e&e,.?
                   i,oundargof the lease as being a line ex-
tending from a pc,int~her? the east line of Sect:on 16, Block
47, H&TC RaIlway Company Survey, intersects the north bank
of the river, to a point where the east line of Section 58,
Block 46 of safd survey intersects the south bank of the river.
The west boundary of the area to be leased clearly was shown
by said plat to be from a point where the west line of Section
19 said Block &7 intersects the north bank of the river to a
point where tne west lrne of Section 62, Block 46 intersects
the south bank of tS.eriver.
       The 3.M. Huber Corporation, as high bidder, was award-
ed a lease. On December II, 1946, lease No. M-30403 was issued
to that company. A deacrfptlon of the property as contained
in the lease was the same as that set forth in the adver-
tisement for lease with an additional reference to "field
notes on file Pn the General Land Office M.F, 1864”. T'he field
notes in the file referred to encompass less area than that
depicted on the plat wh9@h formed the basis of the bid.
Stated briefly, the ffeld notes call for an easterly and west-
erly boundary of the strip to be leased as running north and
south whereas the sketch or plat show these boundaries as
                                                                -   -.   -

Hon. Earl Rudder, page 2 (Ww-248)

running a few degrees off of north, The net result is that
two pie-shaped tracts (one on either end of the area desc-
ribed by the f"ieldnotes) were included in the sketch but
excluded by the field notes. Since the field notes as well
as the sketch were incorpcrated in the lease there results
an ambiguity in the description ,ofthe property leased.
       You ,Purther nointed out that in Cause No. ---
                                                  59581.
State v. Whfttenburg, in the Diat:rietCourt OP Travis County,
                      91y*;,pEc",,
Texas;,53rd ~Jzdi.cia,l         a-"fP;-med
                                         in l.j7S.W. 2d 691,
the State rec~~~~eredLand ihiah :i?genera; is desoribad in
accorc?ancew%h the %l.dd nfx3 I!xreinabovereferred to. In
that Judgment hitwas held th,%tfkmer lease No. 18164 em-
braced the same lanl and was in .%ll force and effect. In

            “I21  C%E J.M. Huber Co~~oratian now @lai.m
       that Lease No0 M-304n-
                           us covera the acreage siwwn
       on tne pl,a%in ,v:Lew
                           of"its knowl.edgeof the
.   e   --

             Hon. Earl Rudder, page 3 (~~-248)

                      WhittTbure, case ,and the description eon-
                      talne In he judgment therein, as reflected
                      by the assignment executed by the said J.M,
                      HilberCoIpopation in 19547
                            "(3) If the lease covers the aPea as
                       shown on the @at, wl.l:,lb;be neseesary .that
                       an amendment to the leage be executed by the
                       Commssslaner?

                    Further, sir:@I,.,
                                     t,p:
                                       ;+
                                        -r'sis not the slightest indication
             of   knowledge
                          or 2h.e J~:?A of” 1:‘r e 3t;zt*   01” of filber  regarding
             the disparity he,t_wce:~:~
                                     ?:!T%F:
                                          :'Seldnoblesand the sketch, there
             is no ba.s:i.s
                         for a c~i:,t:n%:,~*,~~
                                              of a novat,l,on     or "new contract"
             upon the exet:utfo:c,,
                                 ii:;.?,s;;~
                                         ,~er~y,?:f    the lease pra~ar. For the
                          w? be.!.:r?j~e
             same reaso.rp,,           *,f,,;it,
                                             no pa.rticularsigni.ficancecan
             in f&;,sc:ilse
                          tie,             .f;
                             af<;,r::cc:,fQja the Pact ,thatBLiber,9        Ln a sub-
             sequent t:Fti.:<:ls:l"er
                              nf L,'!L*lance
                                          _c_, referFed to the Pleld note
                                        ..~
             descript1,or:.
                         ~~tai.ne-1~ !n the Whlttenbus
                                                _         t g case ,as,   a means of
             dese?i,bf,ng
                        ,L;he
                            prsperty wh,i.'c:h  i3ube;;hen thougnt was aecu-
             rately re?lec,t;ed.
                              by SV% .f"!,eld     notes. It Is manl.festthat
             Huber',;reference to CL% :?:,eld      notes was the result of a
             mistake c,ffact, just as b:tb Iiuberand the State executed
             the lease ~u.rAer
                             an f~irr~~~:!,aal
                                             :?&sapprehensi.on        of fact ~
                                                                -.   -   .

Hon. Earl Rudder, page 4 (WW-24.8)

       It is settled law in this State that upon the ae-
ceptance of a bid a binding aontracltis formed between the
parties whjeh may not be altered by subsequent unilateral
action. Lane and Nearn v. Warren, 115 S.W. 903 (Civ. App.
1909, error ref.). Although this decision relates to a aon-
tract between individuals the doatrine thereof applies with
equal force to an agreement between the State and an indi-
vidual. Jumbo Cattle Company v. Bacon, 79 Tex. 5, 14 S-W.
Mk&;890) ; State v. Robison, 119 Tex. 202, 30 S.W.2d 292,
      D
       The foregoing authorities are decisive of the main
question here under considerat,ion.Whether a aontraot came
into existence between HuSer and the State upon compliance
by Huber with t,hzsales act, in acoordanee with the holdings
in the Jumbo Cattle Company case and the Robison case, supra,
OP whether such contract did not eome into being until the
acceptance by the School Land Board of the Huber bid, it
is u,nnecessaryto decide. rSredisoussions of!this question
in Schneider v, Lipscomb C,unty Na,t.Farm Association, 146
Tex. 66, 202 S,W, 2d 832. 836 (1947). In either view a
binding-contract was re,%&e3 between the State and Huber not
later than upon acceptance oJ"Huber's bid by the State School
Land Board. This, OP course, was prior to the execution of
the lease in questio?. Th?ref"ore,the lease must necessarily
conCorm w!,ththe prior -onSraat between the parties and when
so confomfed embrac~ef3
                      the property depicted in the sketch
or pl:,tby wh:.ch,
                 th,ebi.dwas inv.itedand made.
       With respect to th+ various specific questions pro-
pounded it is WY op.:n4onaad you are so advfseds
       (1) That We easte,rlyand westerly limits of the
lease M-30403 leg&ll:;a::?~!
                          as depicted on the plat attached
to the notice fsr bids. S:incethe field nates are inconsis-
tent with the e;rete,b
                     t%y legally form no part of the contract
between Huber and t,heState and must be rejected.
       (2) That the reference bi Huber in its subsequent as-
signment to the field notes forms no basis for an estopel
because !.tis evident that such referenee was the result of
an innocent mistake. Moreo,-;er,
                               the State had no occasion to
and in fact did not in any way rely on nor was it prejudiced
by such reference and in ,theabsence of such a showing an
estopel w-1.11
             not l,ie.Ktlehnev. Benson, 148 Tex. 54, 219 S.W.
2d 1,006,1,008-1~009,
                    j:1.949j
                          0
Hon. Earl Rudder, page 5 (~~-248)

       (3) Since the lease, as now drawn, aontains an am-
biguous description of the property an amendment correotly
descrlblng the property should be executed by the Commls-
aioner.
       (4) The oorreotlve amendment should have the approval
of the School Land Board. Article .5&1c-3, 10, V.C.S.
       (5) According to the notice for bids the tract was
leased on an "app.roxim&te"acreage basis. The bonus paid
therefor need not be adJu?ted unless the Increase in acreage
occasioned by the Iraelusionof the triangles in
unreasonable, Rich v. F+rguson, 45 Tex. 396 (1%: ); Sla le v
Clark, 237 S.W.2d 4.30 (C~V. App. 1951); see also;flesx
                                                     Woo en v.
State, 142 Tex& 23,8, 17: S.W. 28 57, 58 (1944). Since we do
not at this ,tZ.me
                 know the amaant of a,creagecontained in the
two trfangles we are unzhle to determine ,whetherti;eaddition
thereof w.Z: csIlat-i+.&tean "Y~n?easonable
                                          ' Increase. With
respect to ?n L*:creasein the payment of rentals your atten-
                to Par~-%pb~ 2 ,ofthe lease wherein Huber has
tion Z.si,nvl,ted
agreed to pay T"enua
                  +-Is rrpm~the actual acreage after the
amount thereof has been de%zmined by a survey acceptable to
the Commia~ioner. Thl,so,3fra,ctualprovIsion iS controlling
(as to rectal,payments~)armiif a survey OS the entire area
reveal8 'ricet:!lq"r;7&1 irjws, the actual acreage should form
the baals for ti& c&;p?.f,at.Uo?m
                                of all ren%sis accruing sub-
sequent to the surve::.

            (.2)An fnmcent yeferenoe by a lessee fn
       an ase~gment of a ?,esseto an erroneous de-
       scrfpticn of the property embraced, when not
       rel,fedon by ~310
                       prejudicial to the interests
       cf the State, w,illnot estop the lessee from
       a,3       a r3.ghi;
         se-rL,:!.r~,~   to ~ei%n the lease to con-
       focmiwi,t,ll
                 i ~:52r contract.
            (3) A lease purporting to document a pre-
       existing contract and containing an erroneous
       property desc:rlpt'Ion
                            should be amended or re-
                 conform with suoh prfor @ontract.
       formed -t-m2
Hon. Earl Rudder, page 6 (W-248)

            (4) The Commisstoner of the General Land
       Office is authorized to smend and oorreet an
       erroneous lease only upon approval thereof by
       the Sahoo& Land Board.
                  ere a lease is entered into upon
       an “a$p5ioZmate” acreage basis no adjustment
       of the bonus pa:d legally is requfred unless
       the excess In aoreage is unreasonable. The
       rentals payable under the lease Pm question
       are, a@cording to the zontraot itself, deter-
       minable ‘bythe a@trzalacreage content after
       such aoreage 3.2detem9ned by a aw-vey accep-
       table to the kmmissioner of tRe General.Land
       Offic3e
             o
                               Respect,$kl.ly
                                            submsmitted,
                               WILL WILSON
                               Attorney Gene-al of Texas

JHR:d-b
APPRCXED:
OPINION GOMMIFTEE
H. Grady Chandler, ‘%?2rman
/s/ Howar? mys
    Sam Lane
    James W. Wilson
REVIEWED FOR THE ATTORNEY GENERAL
BY:
       Geo. P, Slackbwn