After segregation, the occupied areas of the townsite were subdivided by the United States into blocks, lots, streets, alleys, and municipal public reservations. Lots owned by non-natives paid an assessment for the survey. 43 C.F.R. §§ 2565.3(a), (b) (1970). Other areas of the townsite remained unsubdivided until occupied. Following subdivision, the Secretary issued patents for the land, allowing the trustee to issue deeds to occupants after payment of any purchase price or assessments. The date of the subdivision survey was the last day for new claims within the subdivision. 43 C.F.R. § 2565.3(c) (1970). Once the subdivision survey was complete, all unclaimed lots could be sold by the trustee at a public sale. 43 C.F.R. § 2565.5 (1970). Proceeds of sales went to the municipality. All unsold lots were deeded to the municipality, a provision which is of central importance in this case. 43 C.F.R. § 2565.7 (1970). After all lands within the townsite trust were progressively subdivided and distributed, the townsite trust terminated. Thus, the distribution process had two major steps. The first step was the segregation, which set aside the townsite. The second step was subdivision, which led to distribution and conveyances of the land.
Appellants contend that the Secretary’s position was incorrect. They argue that only townsite land which had reached the subdivisional step should fall within the existing rights exception. We reject that argument and uphold the Secretary’s interpretation, as did the district court.We rule at the outset that we owe the Secretary’s interpretation considerable deference. Kunaknana v. Clark, 742 F.2d 1145, 1150 (9th Cir. 1984); Jones v. Giles, 741 F.2d 245, 249 (9th Cir. 1984). His interpretation was reasonable.In their challenge to the Secretary’s interpretation, appellants point out that at the time of segregation, municipalities are not certain to receive any land. A municipality’s receipt of any parcel is contingent upon both completion of a subdivision map and an occupant’s not choosing the parcel. These contingencies, appellants assert, take a municipality’s interest outside the statutory phrase “valid existing rights.”
Reinforces board discretion and the legal boundaries around dividends and distributions�often a flashpoint in shareholder trust.