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Real Estate Judgement Summary

The case presented by the United States Attorney General seeks a determination of whether the mineral reservation law on patents holds under the 1916 Stock-Raising Homestead Act. This is after the district court held that owners of a disputed land did not hold valid ownership rights due to the Mineral Reservation Act. The judgment also reviews the interpretation of the Stock-Raising Homestead Act by congress. The main argument in the congressional discussion is the description of geothermal resources as per the act. Additionally, the appellant’s understanding of the act is under scrutiny in relation to the definition of geothermal resources.

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Reviewed Case

This case includes a determination on whether disputed geothermal resources are owned by the mineral estate owners or the surface estate owners. In the case case-eference, the owner of the surface estate was the Union Oil Company of California who claimed ownership (“Open Jurists” 1). The owner of the mineral estate is Geothermal Kinetics. The ownership claims of geothermal resources were backed by ownership title conveyed by former owners through leases to the appellants. Traditionally, the lease transferred rights to drill, extract, produce and sell minerals and steam power from the land.

During the execution of the lease, owners of the surface estate assumed ownership of the valid rights to the minerals. At the same time, Geothermal Kinetics also claimed rights to the minerals through the lease. This means that Union Oil Company of California solely relied on rights vested in them as surface estate owners. These rights may be interpreted to mean exclusive and valid rights even to geothermal resources (“Open Jurists” par. 3). According to the appellants, ownership rights to the property give them exclusive interests to all minerals on the property.

Elements of the Case

According to “Open Jurists” (par. 3), geothermal power represents any untapped natural resource that can be used for national use. In this case, the appellants are the owners of the estate who are seeking geothermal steam for energy use. Under the Stock-Raising Homestead Act, the land in question belongs to the public. The patents in the case are under a reservation of the United States that covers all the types of minerals in the land. The reservation includes the rights to explore more utilities of the natural resources in the land. Under the act, the patent does not include geothermal steam or any related resources in language or in the legislative history. The court holds that the Stock-Raising Homestead Act was not passed with consideration of geothermal power even if it is a resource generated from the land (“Open Jurists” par. 6). Therefore, ownership of the resource does not necessarily hold to the patentees.

The substantial determination of the case also relied on the question of whether it was necessary for the Congress to interpret the meaning or the description of geothermal power. This description is the center of the law and arguments around the case. The court found out that the legislative language offered convincing reasons for the ress to discuss the transfer of private ownership of property. This was because, at the time of the act, the general rule was to sell land with all its exclusive rights to the resources on the land. Therefore, the Congressional discussion would only be considered if the land in question would be classified as non-mineral land. The Stock-Raising Homestead Act was later followed by clear statutes that included the reservations in the United States laws on the sale of land.

The statutes gave the solution by separating surface rights from the underlying mineral rights. However, the appellants argue that geothermal resources are not included in the reservation law since they are not termed as minerals. This way, the law would give the owner more rights over his land. The rights passed would include all minerals even those listed under the statutes that reserved some minerals for the United States (“Open Jurists” 10). In this concern, the court holds that the congressional discussions gave meaning to the Stock-Raising Homestead Act. The opinion of the court also suggests that the law might have been more harmful than useful to the public.


The court also indicates that the act was to favor of the homesteaders by giving them some rights over the land despite taking mineral resources under the reservations. In further argument by the appellants, the law did not include geothermal resources under the minerals reservation act. If this argument was held, then exclusive rights to the resource would be vested to the appellants (“Open Jurists” 10). However, the court holds that the interpretation of the appellants is not administrative in nature as it related to a time when the law was established. This is because their interpretation does not include reservation of minerals for the United States. Therefore, the district court holds that the appellant’s motion to dismiss will be granted. This is because it fails to show a claim on which a relief can be based on.

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