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

CERTIORARI TO THE SUPREME COURT OF CALIFORNIA

No. 82-708. Argued February 29, 1984-Decided April 17, 1984 Petitioner owns the fee title to the Ballona Lagoon, a narrow body of water connected to a manmade harbor located in the city of Los Angeles on the Pacific Ocean. The lagoon became part of the United States following the war with Mexico, which was formally ended by the Treaty of Guadalupe Hidalgo in 1848. Petitioner's predecessors-in-interest had their interest in the lagoon confirmed in federal patent proceedings pursuant to an 1851 Act that had been enacted to implement the treaty, and that provided that the validity of claims to California lands would be decided according to Mexican law. California made no claim to any interest in the lagoon at the time of the patent proceedings, and no mention was made of any such interest in the patent that was issued. Los Angeles brought suit against petitioner in a California state court, alleging that the city held an easement in the Ballona Lagoon for commerce, navigation, fishing, passage of fresh water to canals, and water recreation, such an easement having been acquired at the time California became a State. California was joined as a defendant as required by state law and filed a cross-complaint alleging that it had acquired such an easement upon its admission to the Union and had granted this interest to the city. The trial court ruled in favor of the city and State, finding that the lagoon was subject to the claimed public trust easement. The California Supreme Court affirmed, rejecting petitioner's arguments that the lagoon had never been tideland, that even if it had been, Mexican law imposed no servitude on the fee interest by reason of that fact, and that even if it were tideland and subject to servitude under Mexican law, such a servitude was forfeited by the State's failure to assert it in the federal patent proceedings.

Held: 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 the federal patent proceedings. 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 must have been presented in the patent proceedings or be barred. Cf. Barker v. Harvey, 181 U. S. 481; United States v. Title Ins. & Trust

Co., 265 U. S. 472; United States v. Coronado Beach Co., 255 U. S. 472. Pp. 205-209.

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

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.

Warren M. Christopher argued the cause for petitioner. With him on the briefs were Henry C. Thumann, Zoe E. Baird, William M. Bitting, and Steven W. Bacon.

Deputy Solicitor General Claiborne argued the cause for the United States as amicus curiae urging reversal. With him on the brief were Solicitor General Lee, Assistant Attorney General Dinkins, Dirk D. Snel, and Richard J. Lazarus.

Nancy Alvarado Saggese, Deputy Attorney General of California, argued the cause for respondents. With her on the brief for respondent State of California were John K. Van De Kamp, Attorney General, and N. Gregory Taylor, Assistant Attorney General. Gary R. Netzer, Ira Reiner, and Norman L. Roberts filed a brief for respondent City of Los Angeles.*

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

*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.

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

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.'

'Respondents argue that the decision below presents simply a question concerning an incident of title, which even though relating to a patent issued under a federal statute raises only a question of state law. They rely on cases such as Hooker v. Los Angeles, 188 U. S. 314 (1903), Los Angeles Milling Co. v. Los Angeles, 217 U. S. 217 (1910), and Boquillas Land & Cattle Co. v. Curtis, 213 U. S. 339 (1909). These cases all held, quite properly in our view, that questions of riparian water rights under patents issued under the 1851 Act did not raise a substantial federal question merely because the conflicting claims were based upon such patents. But the controversy in the present case, unlike those cases, turns on the proper construction of the Act of March 3, 1851. Were the rule otherwise, this Court's decision in Barker v. Harvey, 181 U. S. 481 (1901), would have been to dismiss the appeal, which was the course taken in Hooker, rather than to decide the case on the merits. See also Beard v. Federy, 3 Wall. 478 (1866). The opinion below clearly recognized as much, for the California Supreme Court wrote that "under the Act of 1851, the federal government succeeded to Mexico's right in the tidelands granted to defendants' predecessors upon annexation of California," 31 Cal. 3d, at 298, 644 P. 2d, at 798, an interest that "was acquired by California upon its admission to statehood," id., at 302, 644 P. 2d, at 801. Thus, our jurisdiction is based on the need to determine whether the provisions of the 1851 Act operate to preclude California from now asserting its public trust easement.

The 1839 grant to the Machados and Talamantes contained a reservation that the grantees may enclose the property "without prejudice to the traversing roads and servitudes [servidumbres]." App. 5. According to expert testimony at trial, under Las Siete Partidas, the law in effect at the time of the Mexican grant, this reservation in the Machados' and Talamantes' grant was intended to preserve the rights of the public in the tidelands enclosed by the boundaries of the Rancho Ballona. The California Supreme Court reasoned that this interest was similar to the common-law public trust imposed on tidelands. Petitioner and amicus United States argue, however, that this reservation was never intended to create a public trust easement of the magnitude now asserted by California. At most this reservation was inserted in the Mexican grant simply to preserve existing roads and paths for use by the public. See United States v. Coronado Beach Co., 255 U. S. 472, 485-486 (1921); Barker v. Harvey, supra; cf. Jover v. Insular Government, 221 U. S. 623 (1911). While it is beyond cavil that we may take a fresh look at what Mexican law may have been in

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. 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:

1839, see United States v. Perot, 98 U. S. 428, 430 (1879); Fremont v. United States, 17 How. 542, 556 (1855), we find it unnecessary to determine whether Mexican law imposed such an expansive easement on grants of private property.

The Rancho Ballona occupied an area of approximately 14,000 acres and included a tidelands area of about 2,000 acres within its boundaries. The present-day Ballona Lagoon is virtually all that remains of the former tidelands, with filling and development or natural conditions transforming most of much larger lagoon area into dry land. Although respondent Los Angeles claims that the present controversy involves only what remains of the old lagoon, a fair reading of California law suggests that the State's claimed public trust servitude can be extended over land no longer subject to the tides if the land was tidelands when California became a State. See City of Long Beach v. Mansell, 3 Cal. 3d 462, 476 P. 2d 423 (1970).

The Mexican grantees acquired title through a formal process that began with a petition to the Mexican Governor of California. Their petition was forwarded to the City Council of Los Angeles, whose committee on vacant lands approved the request. Formal vesting of title took place after the Rancho had been inspected, a Mexican judge had completed "walking the boundaries," App. 213, and the conveyance duly registered. See generally id., at 1-13; United States v. Pico, 5 Wall. 536, 539 (1867).