LOCATION: Texas State Capitol
DOCKET NO.: 38
DECIDED BY: Warren Court (1962-1965)
LOWER COURT: United States Court of Appeals for the Fifth Circuit
CITATION: 379 US 497 (1965)
ARGUED: Nov 17, 1964
DECIDED: Jan 18, 1965
Facts of the case
Since the late 19th century, Texas sold land to facilitate settlement in the state and construction of schools. If, however, a purchaser missed an interest payment on the property, the land was immediately forfeited back to the state unless the owner made the payment before the land could be re-sold. Under this program, Greenbury Simmons purchased and then forfeited some land in 1947. Just over five years later he offered to pay the interest to re-acquire the property. The state refused to comply with his wishes citing a 1941 amendment to its law which gave individuals five years to claim their forfeited land. Simmons's land was sold to the City of El Paso in 1955.
Did the 1941 amendment to the Texas law violate the Contract Clause of the Constitution?
Media for City of El Paso v. Simmons
Audio Transcription for Oral Argument - November 17, 1964 in City of El Paso v. Simmons
Number 38, City of El Paso versus Greenberry Simmons.
William J. Mounce:
Mr. Chief Justice, may it please the Court.
This case involves title to approximately 620 acres of land located in El Paso County, Texas.
At the trial court, both sides moved for summary judgment.
The City of El Paso's motion was granted and the “at motion” of the appellee Simmons was denied.
On appeal, the Fifth Circuit reversed case.
The facts in this particular case may be very briefly stated.
The appellee Simmons, predecessors in title, purchased these lands involved from the State of Texas in 1910.
The predecessors in title failed to pay interest on the original purchase and the lands were forfeited to the State of Texas in 1947 and reverted to the public domain.
Simmons acquired title in June of 1952, and in the latter part of July, attempted to reinstate the original purchases.
His tendered reinstatement was refused because of the fact that they had not been received by the Land Commissioner within the five years prescribed by the statute within effect.
How did Simmons acquire the title in 1952?
William J. Mounce:
By quitclaim deed.
By quitclaim deed from --
William J. Mounce:
From mean grantees of the original purchasers.
In the latter part of 1955, these lands were awarded to the City of El Paso.
And in 1956, they were actually patented to the City of El Paso.
And this suit was filed in the latter part of August in 1961.
At the time that these lands were purchased from the State of Texas, there was a statute in effect which I believe is 4218 which regulated the one man that the State of Texas might terminate land purchase contracts.
And that statute provides that a land purchase agreement might be reinstated by paying up all back interest providing that no rights of the third parties had intervened.
This particular statute was amended in 1941 to provide that in case that lands were forfeited for the nonpayment of interest that the lands may be reinstated by making payment of all back interest due, and provided that that by it's no third party have intervened and added one proviso that this must be accomplished within five years.
So the question therefore presented for this Court at this time is whether the application of the statute of 1941 which is Article 5336 impairs the obligation of these original contracts.
It is the position of the City of El Paso that the proviso requiring that the reinstatement that the land purchase agreements be reinstated within the five-year period is merely a remedy.
In other words, it's one of the methods by which the State of Texas enforces its contracts and it's not necessarily an obligation of the contract.
As a matter of fact, in order to determine whether a contract obligation has been impaired, one must first determine what the obligations are in the contract.
And in this respect, we're guided by some cases decided for this Court in 1900, which considering con -- land purchase contracts from the State of Texas substantially the same as the contracts not in consideration held that the obligations of the contract were one, that the purchaser would pay down a certain sum of money and make these payments each year until he'd paid it off and whenever he had paid his money, although required by the contract, then the State of Texas would issue patent that this purely and simply with obligations of the contract.
That the method by which the State of Texas enforced the particular obligations and terminated the contract rights referred merely to the remedy and consequently could be modified from time to time as long as the changes were reasonable.
And we submit that this is precisely what we have here.
The State has merely modified the manner in which it terminates the land purchase contracts.