Ervien v. United States/Opinion of the Court

Suit to enjoin the expenditure by appellant, commissioner of public lands of the state of New Mexico, of any of the funds derived from the sale and lease of lands granted and confirmed to the state by the act admitting her into the Union. The right to sell or lease is asserted under a certain act of New Mexico entitled 'An act concerning the publicity and promotion of public resources and welfare.' Laws 1915, c. 60.

The Enabling Act was passed June 20, 1910 (36 Stat. 557, c. 310), and on August 21, 1911, by a joint resolution of the Senate and House of Representatives, New Mexico and Arizona were admitted into the Union upon an equal footing with the original states.

By the Enabling Act certain grants of public lands were made to New Mexico for purposes of which there was a specific enumeration.

It is provided by section 10 of the act that the lands granted and transferred thereby—

'shall be by the said state held in trust, to be disposed of     in whole or in part only in manner as herein provided and for      the several objects specified in the respective granting and      confirmatory provisions, and that the natural products and      money proceeds of any of said lands shall be subject to the      same trusts as the lands producing the same.'

And it is further provided that—

'The disposition of any of said lands, or of any money or     thing of value directly or indirectly derived therefrom, for      any object other than that for which such particular lands,      or the lands from which such money or thing of value shall      have been derived, were granted or confirmed, or in any      manner contrary to the provisions of this act, shall be      deemed a breach of trust.'

It is made the duty of the Attorney General of the United States to prosecute in the name of the United States such proceedings at law or in equity as may be necessary to enforce the provisions of the act 'relative to the application and disposition of the said lands and the products thereof and the funds derived therefrom.'

The constitutional convention was required to provide, by an ordinance irrevocable without the consent of the United States and the people of the state, that the state and its people consent to the provisions of the act, and the Constitution of the state did so provide.

The Legislature of the state on March 8, 1915, passed over the Governor's veto an act entitled as we have designated, the first section of which is as follows:

'Section 1. It shall be unlawful for the commissioner of     public lands to expend for making known the resources and      advantages of this state generally and particularly to      homeseekers and investors, more than three cents on the      dollar of the annual income of his office from sales and      leases of lands, but, up to such limit of money annually, he      may give or cause to be given publicity to such resources and      advantages, and do or cause to be done all incidental work,      in his judgment advisable to be done.'

The commissioner receives from sales and leases of the lands granted a large income annually, the income for the year ending December 31, 1914, being approximately $741,000, and he threatens to expend three cents on the dollar of the annual income derived from sales and leases to give publicity to the resources and advantages of the state generally in conformity with the act of the Legislature of March 8, 1915, and, unless restrained, will do so.

The answer, though in form a denial of some of the averments of the bill and an admission of others, is really an objection to its sufficiency to authorize the relief prayed, and the ground of objection is that the bill taken as a whole—

'is no more than an attempt to interfere with the due     administration of a trust estate by the trustee, the State of New Mexico, which requires the payment of necessary      and proper expenses out of the income or proceeds of the      trust property, the grantor of the trust, the government of      the United States, having made no other provision for the      payment of such necessary and proper costs and expenses; and      defendant avers that the expenditure of a small portion of      such income and proceeds for the purpose of advertising the      resources of the state and the value of its lands, with the      hope of thereby increasing the demand for the purchase and      leasing of such lands and in the enhancing of the prospective      prices to be derived therefrom, is a proper and necessary      expense of the administration of said trust estate.'

A temporary injunction was applied for and denied and subsequently the case by stipulation was submitted upon bill and answer, upon which it was ordered that the bill be and it was dismissed.

The decree was reversed by the Circuit Court of Appeals and the case remanded with direction to enter a decree for the United States. This appeal was then prosecuted.

The case is not in broad range and does not demand much discussion. There is in the Enabling Act a specific enumeration of the purposes for which the lands were granted and the enumeration is necessarily exclusive of any other purpose; and to make assurance doubly sure it was provided that the natural products and money proceeds of such lands should be subject to the same trusts as the lands producing the same. To preclude any license of construction or liberties of inference it was declared that the disposition of any of the lands or of the money or anything of value directly or indirectly derived therefrom for any object other than the enumerated ones should 'be deemed a breach of trust.'

The dedication, we repeat, was special and exact, precluding any supplementary or aiding sense, in prophetic realization, it may be, that the state might be tempted to do that which it has done, lured from patient methods to speculative advertising in the hope of a speedy prosperity.

It must be admitted there was enticement to it and a prospect of realization, and such was the view of the District Court. The court was of opinion that a private proprietor of the lands would without hesitation use their revenues to advertise their advantage and that that which was a wise administration of the property in him could not reach the odious dereliction of a breach of trust in the state.

The phrase, however, means no more in the present case than that the United States, being the grantor of the lands, could impose conditions upon their use, and have the right to exact the performance of the conditions. We need not extend the argument or multiply considerations. The careful opinion of the Circuit Court of Appeals has made it unnecessary. We approve, therefore, its conclusion and affirm its decree.

Affirmed.