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HODGSON v. FEDERAL OIL AND DEVELOPMENT COMPANY ET AL.

decided: April 11, 1927.

HODGSON
v.
FEDERAL OIL AND DEVELOPMENT COMPANY ET AL.



APPEAL FROM THE CIRCUIT COURT OF APPEALS FOR THE EIGHTH CIRCUIT.

Taft, Holmes, Van Devanter, McReynolds, Brandeis, Sutherland, Butler, Sanford, Stone

Author: Mcreynolds

[ 274 U.S. Page 16]

 Mr. JUSTICE McREYNOLDS delivered the opinion of the Court.

Appellant seeks to establish his right to a one-eighth interest in an oil and gas lease upon one hundred and sixty acres of land in Wyoming granted August 21, 1920, by the United States to appellee Federal Oil and Development Company under ยง 18, Act of Congress approved February 25, 1920, c. 85, 41 Stat. 437, 443. The lease was afterwards assigned to The Mountain and Gulf Oil Company upon conditions not here important.

The bill, filed May 26, 1922, proceeds upon the theory --

That January 11, 1887, George McManus and seven associates located a placer mining claim -- The O'Glase -- and thereafter perfected the same; McManus died in 1901, his one-eighth interest descended to his heirs and has never been forfeited, abandoned or lost; these heirs lived beyond Wyoming and were unaware of their interest in the claim for twenty years; the land is within the district withdrawn from entry by Executive order of September 27, 1909; the Federal Oil and Development Company, having become part owner of the claim, took possession and thereafter, asserting ownership to the whole, surrendered the same and procured the existing lease in its own name under the Act of 1920. The company became a co-tenant with the McManus heirs and, consequently, the lease obtained

[ 274 U.S. Page 17]

     by it inured to their benefit; appellant purchased their interest February 11, 1922, and may now impress a trust upon the lease.

The trial court held that no adequate ground for relief was disclosed and dismissed the bill upon motion. This was affirmed by the Circuit Court of Appeals. 5 Fed. 2d 442.

A motion to amend the bill, first made in this Court, must be overruled. It does not appear that the alleged facts have been recently discovered and there is no affidavit in respect of them.

The Act of February 25, 1920, provides --

"Sec. 18. That upon relinquishment to the United States, filed in the General Land Office within six months after the approval of this Act, of all right, title, and interest claimed and possessed prior to July 3, 1910, and continuously since by the claimant or his predecessor in interest under the pre-existing placer mining law to any oil or gas bearing land . . . embraced in the Executive order of withdrawal issued September 27, 1909, and not within any naval petroleum reserve, and upon payment as royalty to the United States of an amount equal to the value at the time of production of one-eighth of all the oil or gas already produced . . . the claimant, or his successor, if in possession of such land, undisputed by any other claimant prior to July 1, 1919, shall be entitled to a lease thereon from the United States for a period of twenty years, at a royalty of not less than 12 1/2 per centum of all the oil or gas produced . . .

"All such leases shall be made and the amount of royalty to be paid for oil and gas produced, except oil or gas used for production purposes on the claim, or unavoidably lost, after the execution of such lease shall be fixed by the Secretary of the Interior under appropriate rules and regulations . . . In case of ...


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