March 17, 1941

at all times under what terms and conditions the production from public lands is being disposed of in order that if such terms and conditions are not satisfactory, appropriate action may be taken.

The approval or disapproval of sales contracts or other methods of disposal of the production from Federal lands is wholly discretionary in nature. The Secretary must exercise his judgment with respect to a number of factors. For example, he must determine the effect, if any, of the price offered under a given contract upon the Government's royalty interest, whether the provisions dealing with measurement of products are in accord with the operating regulations, whether the contract is between proper parties in interest having authority to deal in the production from public lands-in short, he must determine whether approval of the contract will accord with the objectives of the act and conclude whether conditional or unconditional approval or outright rejection is warranted. When the judgment or discretion of an executive officer has been completely exercised in the performance of a specific duty, the act performed is beyond his review or recall, unless power to that extent has also been conferred upon him by the statute. Wilbur v. Burley Irrigation District, 58 F. (2d) 871 (App. D. C. 1932); Garfield v. United States ex rel. Goldsby, 30 App. D. C. 177, 183 (1907) and cases cited therein. This is not a case where the mere modification of administrative orders or regulations is involved (cf. West v. Standard Oil Co., 278 Ù. S. 200 (1929)), but the invalidation of a contract between private parties in reliance upon which there has been a substantial change of position by the parties thereto.

Although there is ample authority under the provisions of sections 30 and 32 of the mineral leasing act to reserve in the leases or in the regulations or in both the power of the Secretary to review or even to recall his approval of sales contracts governing the disposal of products from Federal oil and gas leases, the Department has not done so and no such reservation exists with respect to the contract in question. The leases and the regulations are silent with respect to a review or recall of approval once given by the Secretary. It must be concluded, therefore, that in the absence of fraud, misrepresentation, or mistake the approval constitutes the final action of the Department.

Since the record is free of proof of fraud or misrepresentation there remains for consideration only the question of whether, as is alleged, the action of the Department was arbitrary or unreasonable or was taken in haste and without full consideration.

The petitioner urges that the contract should not have been approved in that it establishes a discriminatory posted price differ

ential for Lance Creek crude oil for a 6-year period in advance, and that revocation of approval is necessary "to protect the rights and equities of those owners of royalty and production, including the Government, in the Lance Creek Field, none of whom are parties to the aforesaid contract of July 1, 1939." But the Department representing the Government's royalty interest is not affected by the price stipulated. The contract was approved upon the express condition that the approval shall not be construed as an admission by the United States that the prices specified in the agreement, insofar as they may apply to the Government's royalty portion of the oil, are reasonable and representative of its fair value or acceptable to the United States. The contract was approved, moreover, because it was deemed in the public interest to take such action. The Department has no authority to take action merely to protect the "rights and equities of owners of royalty and production" in the Lance Creek field. The mineral leasing act empowers the Secretary to take such action only as he deems to be in the public or Federal interest. If such action does not coincide with the private interests of all concerned, the conflicting private interests must yield. The Department having acted in the public interest, its determination cannot be characterized as arbitrary and unreasonable merely because the contract may have had an adverse effect upon the petitioners.

The petitioner also asserts that the Department, in approving the contract of July 1, 1939, failed to act with its usual deliberation, and that it approved the contract without consideration or approval of seven prior underlying contracts relating to the sale and purchase of Sundance and Leo crude oil produced from the Lance Creek field. The assertion that the Department acted on the contract without adequate deliberation is refuted by the record. (Tr. pp. 73-80). The contract was carefully considered in the light of the order establishing a minimum price at the Lance Creek field for the purpose of computing Government royalties before it was conditionally approved. The only significance of the reference in the July 1, 1939, contract to the seven prior underlying contracts discussed in the petitioner's brief is that they establish an order of priority governing the taking of Lance Creek oil by the respondent, Utah Oil Refining Company. From the record it appears that they are not in any way amendatory of, or supplementary to, the July 1, 1939, contract and they have no direct relationship with that contract. The contracts that involve the disposal of Government royalty oil are, of course, subject to the same form of conditional approval as was accorded the respondents' contract.

In view of the foregoing, I find that no misrepresentation nor fraud in securing conditional approval of the contract of July 1,

March 29, 1941

1939, has been proved, and that the Department's action was neither arbitrary, unreasonable nor ill-considered. Consequently, the petition of the Lance Creek Independent Oil Producers and Royalty Owners' Association, Inc., for revocation of the Department's approval of July 26, 1939, of the contract in question should be and is hereby denied.

Denied.

EMPLOYMENT OF ALIENS BY GOVERNMENT OF
VIRGIN ISLANDS

Opinion, March 29, 1941

VIRGIN ISLANDS-OFFICIALS-EMPLOYEES-CITIZENSHIP.

The employment of an alien pilot by the Harbor Department of the Municipality of St. Thomas and St. John does not contravene section 38 of the Organic Act of the Virgin Islands (49 Stat. 1817, 48 U. S. C. sec. 1406j), requiring that "all officials of the Government of the Virgin Islands * * * be citizens of the United States," since a pilot is merely an employee and not an "official," the tenure, duration, duties and salary of the position not being fixed by law.

MARGOLD, Solicitor:

My opinion has been requested as to whether service by James E. Simmons, an alien, as a pilot of the Municipality of St. Thomas and St. John, Virgin Islands, contravenes section 38 of the Organic Act of the Virgin Islands (49 Stat. 1817, 48 U. S. C. sec. 1406j). That section provides that "All officials of the Government of the Virgin Islands shall be citizens of the United States * *" Under sec

tion 2 of that act, the phrase "the Government of the Virgin Islands," as used in the act, includes "the governing authority of the two municipalities."

The question of the employment of James E. Simmons as a pilot by the St. Thomas Harbor Board was considered in a memorandum of the Acting Solicitor dated October 15, 1937. In that memorandum it was held that "a pilot in the employ of and paid by the Harbor Board would not be an officer of either the Government of the Virgin Islands or the government of the Municipality of St. Thomas and St. John, and could not be classified as an 'official' in the sense and meaning of the word as used in section 38" of the Organic Act and that "it is unnecessary to decide the question on the basis of the distinction that exists between an employee and an official * *

By ordinance of the Municipal Council of St. Thomas and St. John approved March 1, 1941, the St. Thomas Harbor Law of April 6, 1906, which created the Harbor Board, was repealed and a Harbor

Department was created as a department of the municipality. Section 4 of that ordinance provides:

(a) There is hereby created a Harbor Department for the purpose of administering the functions of the Harbor of St. Thomas. The head of this Department shall be known as the Harbormaster. The Harbormaster and all other officers and employees necessary for the proper functioning of this Department shall be appointed by the Governor, by and with the advice and consent of the Municipal Council, Provided, that the present incumbents of all offices and positions under the Harbor Department shall continue in office until their successors are appointed and have qualified unless sooner removed by competent authority.

(b) Funds, for defraying the expenses of administering the Harbor Department, including the salaries of the Harbormaster and other officers and employees of said department, shall be made available in the annual municipal budget from March 1, 1941.

It is therefore necessary to determine whether one serving in the capacity of a pilot is an "official" of the municipality.

While the term "office" is not susceptible of precise definition, the Supreme Court of the United States has stated that it "embraces the. idea of tenure, duration, emolument and duties fixed by law." Metcalf and Eddy v. Mitchell, 269 U. S. 514, 520.

The appointment of James E. Simmons, as a pilot of the St. Thomas Harbor Board, was originally made by the Governor pursuant to an amendment to the budget for the St. Thomas Harbor for the fiscal year 1938 which made provision for the position and specified the salary thereof. The appointment was for an indefinite period. The duties of the position were prescribed by the Harbormaster.

The status of the position was not changed by the ordinance of March 1, 1941. It has neither tenure, duration, duties or salary fixed by law. The position may be abolished, the incumbent removed, the salary and duties changed by appropriate administrative action at any time.

In these circumstances, it is my opinion that James E. Simmons, in his capacity as pilot, is merly an employee of the municipal government and not an "official" thereof. It follows that his continued employment in that position does not contravene section 38 of the Organic Act which requires all "officials" of the governments of the Virgin Islands to be citizens of the United States.

Approved:

OSCAR L. CHAPMAN,

Assistant Secretary.

UNITED STATES v. AARON CLEMENTS

Decided March 31, 1941

STOCK-RAISING HOMESTEAD APPLICATION-SUBSTITUTE-RIGHTS INITIATED. A stock-raising homestead application to enter undesignated lands, filed as an amendment of an earlier application and including other lands, is a substitute for, rather than an amendment of the earlier one, and, upon designation, the applicant's rights relate back to the later application and not to the earlier one.

CHAPMAN, Assistant Secretary:

On October 19, 1927, Aaron Clements applied to enter 430.79 acres of land within the Blackfoot, Idaho, land district under the act of December 29, 1916 (39 Stat. 862, 43 U. S. C. sec. 291). He filed a second entry showing as required by the act of September 5, 1914 (38 Stat. 712, 43 U.S. C. sec. 182). On December 12, 1927, a supplemental homestead application was filed with changes in the land description which increased the acreage applied for to 593.49 acres. A petition was also filed requesting that the lands applied for be designated as of stock-raising character, and, on April 13, 1928, they were so designated. The second entry showing was found to be satisfactory, and homestead entry was allowed on June 25, 1928, of the lands applied for on December 12, 1927.

As the result of a field investigation conducted in November 1934, the Commissioner of the General Land Office on May 10, 1935, directed adverse proceedings against the entry charging that the entryman had not established and maintained a residence in accordance with the requirements of law; that he had not placed permanent improvements on the land to the value of at least $1.25 per acre; and that he was not qualified to make the entry for the reason that at the time it was initiated he was the owner and proprietor of more than 160 acres. Final proof was submitted July 24, 1935, about two months after receipt of the notice of the adverse proceedings. It is alleged in the final proof that residence was established August 1, 1928, and maintained continuously to the date of final proof, and that a house and 31⁄2 miles of fence, valued at $921, have been placed upon the land.

At the hearing held before George A. McLeon, probate judge, at Hailey, Idaho, J. G. Hedrick, Esq., appeared for the entryman, and R. P. Lowther, a special agent of the Department, appeared on behalf of the Government.

Upon consideration of the evidence adduced at the hearing, the register, on September 12, 1939, recommended cancelation of the entry on the ground that the entryman did not make a bona fide residence on the land. He held that the charges as to insufficient improvements and ownership of more than 160 acres had not been sustained. The entryman appealed to the Commissioner of the General Land Office.

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