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SUMMA CORP. v. CALIFORNIA EX REL. STATE LANDS COMMISSION ET AL.

SUPREME COURT OF THE UNITED STATES


decided: April 17, 1984.

SUMMA CORP
v.
CALIFORNIA EX REL. STATE LANDS COMMISSION ET AL.

CERTIORARI TO THE SUPREME COURT OF CALIFORNIA.

Rehnquist, J., delivered the opinion of the Court, in which all other Members joined except Marshall, J., who took no part in the decision of the case.

Author: Rehnquist

[ 466 U.S. Page 199]

 JUSTICE REHNQUIST delivered the opinion of the Court.

Petitioner owns the fee title to property known as the Ballona Lagoon, a narrow body of water connected to Marina del Rey, a manmade harbor located in a part of the city of

[ 466 U.S. Page 200]

     Los Angeles called Venice. Venice is located on the Pacific Ocean between the Los Angeles International Airport and the city of Santa Monica. The present case arises from a lawsuit brought by respondent city of Los Angeles against petitioner Summa Corp. in state court, in which the city alleged that it held an easement in the Ballona Lagoon for commerce, navigation, and fishing, for the passage of fresh waters to the Venice Canals, and for water recreation. The State of California, joined as a defendant as required by state law, filed a cross-complaint alleging that it had acquired an interest in the lagoon for commerce, navigation, and fishing upon its admission to the Union, that it held this interest in trust for the public, and that it had granted this interest to the city of Los Angeles. The city's complaint indicated that it wanted to dredge the lagoon and make other improvements without having to exercise its power of eminent domain over petitioner's property. The trial court ruled in favor of respondents, finding that the lagoon was subject to the public trust easement claimed by the city and the State, who had the right to construct improvements in the lagoon without exercising the power of eminent domain or compensating the landowners. The Supreme Court of California affirmed the ruling of the trial court. City of Los Angeles v. Venice Peninsula Properties, 31 Cal. 3d 288, 644 P. 2d 792 (1982).

In the Supreme Court of California, petitioner asserted that the Ballona Lagoon had never been tideland, that even if it had been tideland, Mexican law imposed no servitude on the fee interest by reason of that fact, and that even if it were tideland and subject to a servitude under Mexican law, such a servitude was forfeited by the failure of the State to assert it in the federal patent proceedings. The Supreme Court of California ruled against petitioner on all three of these grounds. We granted certiorari, 460 U.S. 1036 (1983), and now reverse that judgment, holding that even if it is assumed that the Ballona Lagoon was part of tidelands subject by Mexican law to the servitude described by the Supreme

[ 466 U.S. Page 201]

     Court of California, the State's claim to such a servitude must have been presented in the federal patent proceeding in order to survive the issue of a fee patent.*fn1

[ 466 U.S. Page 202]

     Petitioner's title to the lagoon, like all the land in Marina del Rey, dates back to 1839, when the Mexican Governor of California granted to Augustin and Ignacio Machado and Felipe and Tomas Talamantes a property known as the Rancho Ballona.*fn2 The land comprising the Rancho Ballona became part of the United States following the war between the United States and Mexico, which was formally ended by the Treaty of Guadalupe Hidalgo in 1848. 9 Stat. 922. Under the terms of the Treaty of Guadalupe Hidalgo the United States undertook to protect the property rights of Mexican landowners, Treaty of Guadalupe Hidalgo, Art. VIII, 9 Stat. 929, at the same time settlers were moving into California in large numbers to exploit the mineral wealth and other resources of the new territory. Mexican grants encompassed well over 10 million acres in California and included some of the best land suitable for development. H. R. Rep. No. 1, 33d Cong., 2d Sess., 4-5 (1854). As we wrote long ago:

[ 466 U.S. Page 203]

     "The country was new, and rich in mineral wealth, and attracted settlers, whose industry and enterprise produced an unparalleled state of prosperity. The enhanced value given to the whole surface of the country by the discovery of gold, made it necessary to ascertain and settle all private land claims, so that the real estate belonging to individuals could be separated from the public domain." Peralta v. United States, 3 Wall. 434, 439 (1866).

See also Botiller v. Dominguez, 130 U.S. 238, 244 (1889).

To fulfill its obligations under the Treaty of Guadalupe Hidalgo and to provide for an orderly settlement of Mexican land claims, Congress passed the Act of March 3, 1851, setting up a comprehensive claims settlement procedure. Under the terms of the Act, a Board of Land Commissioners was established with the power to decide the rights of "each and every person claiming lands in California by virtue of any right or title derived from the Spanish or Mexican government. . . ." Act of Mar. 3, 1851, § 8, ch. 41, 9 Stat. 632. The Board was to decide the validity of any claim according to "the laws, usages, and customs" of Mexico, § 11, while parties before the Board had the right to appeal to the District Court for a de novo determination of their rights, § 9; Grisar v. McDowell, 6 Wall. 363, 375 (1868), and to appeal to this Court, § 10. Claimants were required to present their claims within two years, however, or have their claims barred. § 13; see Botiller v. Dominguez, supra. The final decree of the Board, or any patent issued under the Act, was also a conclusive adjudication of the rights of the claimant as against the United States, but not against the interests of third parties with superior titles. § 15.

In 1852 the Machados and the Talamantes petitioned the Board for confirmation of their title under the Act. Following a hearing, the petition was granted by the Board, App. 21, and affirmed by the United States District Court on appeal,

[ 466 U.S. Page 204]

     tidelands at the time California became a State, irrespective of the present character of the land. See City of Long Beach v. Mansell, 3 Cal. 3d 462, 486-487, 476 P. 2d 423, 440-441 (1970). Through this easement, the State has an overriding power to enter upon the property and possess it, to make physical changes in the property, and to control how the property is used. See Marks v. Whitney, 6 Cal. 3d 251, 259-260, 491 P. 2d 374, 380-381 (1971); People v. California Fish Co., 166 Cal. 576, 596-599, 138 P. 79, 87-89 (1913). Although the landowner retains legal title to the property, he controls little more than the naked fee, for any proposed private use remains subject to the right of the State or any member of the public to assert the State's public trust easement. See Marks v. Whitney, supra.

The question we face is whether a property interest so substantially in derogation of the fee interest patented to petitioner's predecessors can survive the patent proceedings conducted pursuant to the statute implementing the Treaty of Guadalupe Hidalgo. We think it cannot. The Federal Government, of course, cannot dispose of a right possessed by the State under the equal-footing doctrine of the United States Constitution. Pollard's Lessee v. Hagan, 3 How. 212 (1845). Thus, an ordinary federal patent purporting to convey tidelands located within a State to a private individual is invalid, since the United States holds such tidelands only in trust for the State. Borax, Ltd. v. Los Angeles, 296 U.S. 10, 15-16 (1935). But the Court in Borax recognized that a different result would follow if the private lands had been patented under the 1851 Act. Id., at 19. Patents confirmed under the authority of the 1851 Act were issued "pursuant to the authority reserved to the United States to enable it to discharge its international duty with respect to land which, although tideland, had not passed to the State." Id., at 21. See also Oregon ex rel. State Land Board v. Corvallis Sand & Gravel Co., 429 U.S. 363, 375 (1977); Knight v. United States Land Assn., 142 U.S. 161 (1891).

[ 466 U.S. Page 206]

     This fundamental distinction reflects an important aspect of the 1851 Act enacted by Congress. While the 1851 Act was intended to implement this country's obligations under the Treaty of Guadalupe Hidalgo, the 1851 Act also served an overriding purpose of providing repose to land titles that originated with Mexican grants. As the Court noted in Peralta v. United States, 3 Wall. 434 (1866), the territory in California was undergoing a period of rapid development and exploitation, primarily as a result of the finding of gold at Sutter's Mill in 1848. See generally J. Caughey, California 238-255 (2d ed. 1953). It was essential to determine which lands were private property and which lands were in the public domain in order that interested parties could determine what land was available from the Government. The 1851 Act was intended "to place the titles to land in California upon a stable foundation, and to give the parties who possess them an opportunity of placing them on the records of this country, in a manner and form that will prevent future controversy." Fremont v. United States, 17 How. 542, 553-554 (1855); accord, Thompson v. Los Angeles Farming Co., 180 U.S. 72, 77 (1901).

California argues that since its public trust servitude is a sovereign right, the interest did not have to be reserved expressly on the federal patent to survive the confirmation proceedings.*fn4 Patents issued pursuant to the 1851 Act were,

[ 466 U.S. Page 207]

     of course, confirmatory patents that did not expand the title of the original Mexican grantee. Beard v. Federy, 3 Wall. 478 (1866). But our decisions in a line of cases beginning with Barker v. Harvey, 181 U.S. 481 (1901), effectively dispose of California's claim that it did not have to assert its interest during the confirmation proceedings. In Barker the Court was presented with a claim brought on behalf of certain Mission Indians for a permanent right of occupancy on property derived from grants from Mexico. The Indians' claim to a right of occupancy was derived from a reservation placed on the original Mexican grants permitting the grantees to fence in the property without "interfering with the roads, crossroads and other usages." Id., at 494, 495. The Court rejected the Indians' claim, holding:

"If these Indians had any claims founded on the action of the Mexican government they abandoned them by not

[ 466 U.S. Page 208]

     presenting them to the commission for consideration, and they could not, therefore, . . . 'resist successfully any action of the government in disposing of the property.' If it be said that the Indians do not claim the fee, but only the right of occupation, and, therefore, they do not come within the provision of section 8 as persons 'claiming lands in California by virtue of any right or title derived from the Spanish or Mexican government,' it may be replied that a claim of a right to permanent occupancy of land is one of far-reaching effect, and it could not well be said that lands which were burdened with a right of permanent occupancy were a part of the public domain and subject to the full disposal of the United States. . . . Surely a claimant would have little reason for presenting to the land commission his claim to land, and securing a confirmation of that claim, if the only result was to transfer the naked fee to him, burdened by an Indian right of permanent occupancy." Id. at 491-492.

The Court followed its holding in Barker in a subsequent case presenting a similar question, in which the Indians claimed an aboriginal right of occupancy derived from Spanish and Mexican law that could only be extinguished by some affirmative act of the sovereign. United States v. Title Ins. & Trust Co., 265 U.S. 472 (1924). Although it was suggested to the Court that Mexican law recognized such an aboriginal right, Brief for Appellant in United States v. Title Ins. & Trust Co., O. T. 1923, No. 358, pp. 14-16; cf. Chouteau v. Molony, 16 How. 203, 229 (1854), the Court applied its decision in Barker to hold that because the Indians failed to assert their interest within the timespan established by the 1851 Act, their claimed right of occupancy was barred. The Court declined an invitation to overrule its decision in Barker because of the adverse effect of such a decision on land titles, a result that counseled adherence to a settled interpretation. 265 U.S., at 486.

[ 466 U.S. Page 209]

     Finally, in United States v. Coronado Beach Co., 255 U.S. 472 (1921), the Government argued that even if the landowner had been awarded title to tidelands by reason of a Mexican grant, a condemnation award should be reduced to reflect the interest of the State in the tidelands which it acquired when it entered the Union. The Court expressly rejected the Government's argument, holding that the patent proceedings were conclusive on this issue, and could not be collaterally attacked by the Government. Id., at 487-488. The necessary result of the Coronado Beach decision is that even "sovereign" claims such as those raised by the State of California in the present case must, like other claims, be asserted in the patent proceedings or be barred.

These decisions control the outcome of this case. We hold that California cannot at this late date assert its public trust easement over petitioner's property, when petitioner's predecessors-in-interest had their interest confirmed without any mention of such an easement in proceedings taken pursuant to the Act of 1851. The interest claimed by California is one of such substantial magnitude that regardless of the fact that the claim is asserted by the State in its sovereign capacity, this interest, like the Indian claims made in Barker and in United States v. Title Ins. & Trust Co., must have been presented in the patent proceeding or be barred. Accordingly, the judgment of the Supreme Court of California is reversed, and the case is remanded to that court for further proceedings not inconsistent with this opinion.

It is so ordered.

JUSTICE MARSHALL took no part in the decision of this case.

Disposition

31 Cal. 3d 288, 644 P. 2d 792, reversed and remanded.

Counsel FOOTNOTES

* Edgar B. Washburn and Nancy J. Stivers filed a brief for the California Land Title Association as amicus curiae urging reversal.

Briefs of amici curiae urging affirmance were filed for the National Audubon Society et al. by Palmer Brown Madden and Linda Agerter; and for Amigos de Bolsa Chica by Lynda Martyn.

Briefs of amici curiae were filed for the State of Texas by Jim Mattox, Attorney General, David R. Richards, Executive Assistant Attorney General, and Jim Mathews, R. Lambeth Townsend, and Ginny Agnew, Assistant Attorneys General; and for the Pacific Legal Foundation by Ronald A. Zumbrun and John H. Findley.


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