not fully attained if a grantee of the Secretary, either directly or by mesne conveyances, is not permitted to interpose it.
Rule 15 of the Federal Rules of Civil Procedure as recently amended, which deals with amendments of pleadings, does not aid the plaintiffs. Subsection (c) of the Rule concerns relation back of amendments. It is limited to amendments changing the party against whom a complaint was served. It does not apply to additional parties.
It is a well established principle that ordinarily a new party brought in subsequently to the commencement of an action may interpose a defense of the statute of limitations even if it arose subsequently to the initial institution of the original action but prior to the bringing in of the parties seeking the advantage of the defense. Consequently, the defense of the statute of limitations as to these additional defendants will be sustained, and no relief will be granted as against them.
The Court will proceed to determine the matter as to the Secretary and as to the intervening defendant, Standard Oil Company of California. Under his rulemaking power, the Secretary of the Interior adopted a regulation which, in effect, determines who constitutes the person first making an application for a lease, under 30 U.S.C. § 226, subsection (c). Title 43 of the Code of Federal Regulations, Section 1821.2-3, provides, in effect, that if applications are filed within the period prescribed by an order or notice of the Secretary, they shall all be deemed to have been filed simultaneously. It is further provided that all such applications which conflict, in whole or in part, - and by the word "conflict" is meant, no doubt, overlap or cover the same area - will be included in a drawing which will fix the order in which the applications will be processed. In other words, all applications filed before a specified date are deemed to have been filed simultaneously, and their order of priority will be determined by lot. This regulation was approved as to its validity by the United States Court of Appeals for the District of Columbia Circuit in Thor-Westcliffe Development, Inc., v. Udall, 114 U.S.App.D.C. 252, 314 F.2d 257.
It is claimed in behalf of the plaintiffs that this regulation has been violated by the Secretary. The procedure followed in this instance was to make such a drawing as is provided by the regulation. Then, it having been found that the applicant whose name was first drawn was not qualified, all other applications were ignored, and applications of subsequent applicants were granted. The further step taken by the Secretary of summarily ignoring all applications except the first one drawn and accepting later applications when the first one drawn turned out to have been submitted by an applicant who was not qualified, has never been approved by the Court of Appeals. On its face, it seems contrary both to the statute and to the regulations, because it gives preference to a subsequent applicant as against all of the original applicants except the one whose name is first drawn.
In view of these considerations, the Court is of the opinion that the procedure followed by the Secretary of the Interior in this instance was invalid; that the Secretary, when the first name was rejected, should have drawn another one. If the second applicant whose name was drawn was likewise disqualified, then a third name should have been drawn, and so on. There is no provision under which applicants whose applications were regularly filed may be ignored and subsequent applications accorded preference over them.
Moreover, it is obviously a grave injustice to reject or ignore all applicants but the first one whose name was drawn. It would mean that if an applicant under such circumstances wished to protect his rights, he would immediately have to file a new application. There would follow the same race of applicants, which it was sought to avoid by the regulation to which reference has been made.
There is another ground leading the Court to the conclusion that the procedure followed in this instance was invalid. The notice of leasing, dated March 10, 1964, involved in this instance, stated that offers to lease the land in question might be filed in the Fairbanks Land Office, Bureau of Land Management, from the date when the approved leasing maps were officially filed in that office until 10 a.m., June 2, 1964. Then it was provided in subsection (b) of paragraph (3) of the notice that:
"Such offers will be considered as having been simultaneously filed. The priorities of all conflicting offers will be determined in accordance with the regulation 43 CFR 295.8."
The last mentioned regulation is the one to which the Court has already referred, it having been re-numbered in a subsequent edition of the Code.
To be sure, subsection (c) contains a provision reading as follows:
"Only one entry card will be drawn for each leasing block."