                             THEAITORNICYGENERAL
                                       OF, TEXAS
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A--               alMamAn.

                                          July 19, 1977


             Honorable Chris A. Mealy                Opinion No. H- 1025
             County Attorney
             Llano County Courthouse                 Re: Validity of option to
             Llano. Texas                            lease school land from
                                                     county.
             Dear Mr. Mealy:

                  YOU inform us that Llano County leased certain school
             lands to private individuals for
                                          .   a five-year period.
                                                           .       The
             lease gave the lessees an option to re-lease the property
             at the end of the five-year period, provided they equaled
             the bid of any other party wishing to lease the land. You
             inquire whether the option is valid and binding on the county.

                  Article 7, section 6 of the Texas Constitution, which
             provides for disposition of county school lands, reads in
             part:
                             All lands . . . granted to the several
                             counties of this State for educational
                             purposes, are of right the property of
                             said counties respectively. . . . Each
                             county may sell or dispose of its lands
                             in whole or in part, in manner to be
                             provided by the Commissioners' Court of
                             the county.
                  Section 17.82(a) of the Education Code also authorizes
             the county to sell or dispose of school lands in the manner
             prescribed by the commissioners court. Under these consti-
             tutional and statutory provisions, the counties may lease
             school lands. Falls County v. DeLaney, 11 S.W. 492 (Tex.
             1889).
                  We have found no Texas case which conclusively determines
             the power of the commissioners court to grant an option to
             lease school lands. In three cases, however, the courts have
             discussed the power of the commissioners to grant an option to
             purchase. In two of those cases the courts stated that the
             commissioners court lacked such power. Potter County v. C.C.




                                           p. 4233
Aonorable Chris A. Mealy - Page 2   (S-1025)


Slaughter Cattle Co., 254 S.W. 775 (Tex. Comm'n App. 1923,
jdgmtadoptea),    n,   235 S.W. 295 (Tex. Civ. App. -- Amarillo
1921); Midland County v. Slaughtc!I, 130 S.W. 612 (Tex. Civ.
App. 19'10,writ ref'd)   The courlt in Ellerd v. Cox,,114 S.W.
410 (Tex. Civ. ADD. 19h8. no writ) , however. concluded that
the county had implied power to give an option to purchase as
an incident to a lease. In none of these cases was the dis-
cussion of the validity of the purchase option necessary to
the judgment, and the Supreme Court did not write on or ex-
pressly adopt the reasoning of the lower courts in any of the
three cases. See Texas Rules of Form (3rd ed. 1974) at 6, 8,
for explanationof the significance of "judgment adopted" cases
and "writ refused" cases prior to 1927.
     We believe the disparate dicta of these lower court cases
relating to options to purchase land provide little guidance
in determining the power of a county to grant an option to
lease its school lands. We find more persuasive the language
used by the Supreme Court in upholding the power of a county
to enter into an oil lease on,its school lands:
            There is nothing in the constitutional
          provision here involved which in the re-
          motest degree limits the right of the
          commissioners' court to make a sale of
          its mineral estate upon terms similar to
          those made by citizens generally.
Ehlinger v. Clark, 8 S.W.2d 666, 671 (Tex. 1928). This lan-
guage was quoted in the more recent case of Upshur County v.
Heydrick, 221 S.W.Zd 326, 328 (Tex. Civ. App. -- Eastland
1949, writ ref'd n.r.e.1. Although the court did not di-
rectly consider the point, the contract upheld in Ehlinger
v. Clark contained a "renewal" clause, empowering the lessee
to defer commencement of drilling for 12 months upon payment
of $200.
     While the matter is certainly not free from doubt, we
believe the expansive reading of the constitutional power Of
the commissioners court in Ehlinger v. Clark and Upshur County
v. Heydrick indicates the courts would conclude that a County
may lease its school lands upon terms similar to those made
by citizens generally, including a reasonable option to extend
the lease period. Cf. Gr~iffinv. Bell, 202 S.W. 1034 (Tex.
Civ. App. -- Texarkz   1918, writ repd):' Blaffer 6 Farish V.
Gulf Pipe Line Co., 218 S.W. 89 (Tex. Civ. App. -- Galveston




                         P. 4234
,




    Honorable Chris   A.   Mealy - Page 3   (R-1025)


    1919, no writ) (upholding validity of options in contracts by
    private parties). You have suggested no other grounds by
    which the contract in question might be invalid or not binding
    on the county.
                                SUMMARY

                Texas courts would probably hold that
                the commissioners court of a county may
                lease the county's school lands upon
                terms similar to those made by citizens
                generally, including a reasonable option
                to extend the lease period.



                                    ,JIgTiz
                                        .
                                        Attorney General of Texas
                                    i
    APPROVED:              /


L&f DAVID M. KENDALL, First Assistant




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