## Facts

- Louise F. Short owned surface land subject to severed mineral interests claimed by Texaco, Inc. and other defendants.
- The cases involved Indiana’s Mineral Lapse Act, which extinguishes severed interests in coal, oil, gas, or other minerals after 20 years of nonuse.
- The Act defined “use” to include mineral production, payment of rents/royalties/taxes, or filing a claim in a county “dormant mineral interest” record.
- The Act provided a two-year grace period from its effective date for mineral interest holders to file a claim to preserve interests that would otherwise lapse.
- In consolidated trial court actions (including a companion case involving the Waldens), the trial court held the Act unconstitutional on due process, takings, equal protection, and contract-impairment grounds.
- The State of Indiana intervened on appeal to defend the statute’s constitutionality.

## Issues

1. Whether the Mineral Lapse Act violates due process by automatically extinguishing dormant mineral interests without individualized notice and hearing.
2. Whether extinguishment of dormant severed mineral interests under the Act constitutes an unconstitutional taking without just compensation.
3. Whether the Act denies equal protection through its definitions and classifications concerning “use” and lapse.
4. Whether the Act unconstitutionally impairs existing contract or vested property rights.

## Decision

- The Indiana Supreme Court reversed the trial courts’ judgments and upheld the Act as constitutional.
- The court held the Act valid under the State’s police power to address title uncertainty and impediments to mineral and surface development.
- The court rejected the procedural due process challenge, reasoning the Act is self-executing and does not operate through adjudication requiring a tribunal, notice, or hearing.
- The court rejected the takings/substantive due process challenge, treating the statute as a limitation-type measure that conditions continued ownership on minimal acts of diligence over a lengthy period (including a two-year grace period).
- The court rejected the equal protection and contract-impairment challenges under deferential review because no fundamental right or suspect class was implicated.
- The cases were remanded for enforcement of the Act.

## Legal Principles

- A statute that does not burden a fundamental right or target a suspect class is reviewed for whether it is a rational means to a legitimate governmental end.
- Courts presume statutes constitutional; challengers bear a heavy burden, and doubts are resolved in favor of validity.
- A self-executing property statute may define conditions that mandate extinguishment of an interest without providing individualized adjudicatory procedures.
- Conditioning retention of a severed mineral interest on “use” (production, payment of rents/royalties/taxes, or filing a record claim), with a grace period, can be a valid police-power measure aimed at clearing title and facilitating resource development.
- Extinguishment resulting from an owner’s prolonged inaction, where simple steps exist to preserve the interest, is not necessarily a compensable taking or unconstitutional impairment of rights.

## Conclusion

Indiana’s Mineral Lapse Act constitutionally extinguishes severed mineral interests after twenty years of nonuse when the owner does not take defined steps to preserve the interest, and the statute’s automatic operation, classifications, and effect on prior interests were upheld as rationally related to legitimate public objectives.


Short v. Texaco, Inc., 406 N.E.2d 625 (Ind. 1980)