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testimony that the strata of oil shale or rock exposed on the Summers homestead by nature, or the efforts of the contestee or those in his service, or his predecessors in title, are not and probably never will be valuable as oil shale deposits because of the thinness of the strata or the leanness as to oil content.
If there were a probability of these strata increasing materially in thickness or oil content with distance from the surface, as in the case of certain precious metals, then a valid discovery might be claimed under the rule laid down that an actual disclosure of commercial ore is not essential to effect an adequate discovery (48 L. D. 598, U. S. v. Bunker Hill and Sullivan Mining & Concentrating Company).
The contestant's own contention and one that is well supported in fact shows that all beds of oil shale are in place, each of a thickness which does not vary materially and of a certain oil content which varies but slightly. While there appears to be no question but that immense shale beds underlie this land at a considerable depth, it is just as clear that the higher strata exposed on the Summers place, and on which discovery is claimed, do not now constitute valuable deposits and by development in the future could not be expected to show such value as to make them merchantable. Hence it is our opinion that on such deposits a discovery can not be predicated on which to base a valid m neral claim to the land.
Senator WALSH of Montana. It will be observed that the register and receiver are discussing the question as to what is necessary in order to constitute a discovery. The commissioner does not discuss that subject.
Mr. FINNEY. No.
Senator GLENN (interposing). Isn't that a matter of law, Senator Walsh?
Senator WALSH of Montana. It is a matter of law and the facts.
Senator Glexx. As to what constitutes a valuable discovery, is a matter of law.
Senator WALSH of Montana. You must apply it to the facts.
Mr. FINNEY. I am not undertaking to state now all of the facts that were in the record. The commissioner does not set them out in detail in his paper.
Senator Walsh of Montana. I am not taking any position with respect to any of these matters. I am simply endeavoring to develop what the controversy was about.
Mr. FINNEY. Yes.
Senator Walsh of Montana. An apeal was then apparently taken from the commissioner to the Secretary.
Mr. Fixxey. Yes, sir; the homestead claimant then appealed to the Secretary of the Interior.
Senator Walsh of Montana. Now, let us see what the Secretary has to say about it.
Mr. FINNEY. The record was reviewed in the office of the Secretary.
Senator PITTMAX. Who was the Secretary of the Interior at that time?
Mr. FINNEY. Secretary Work was Secretary, and I was First Assistant Secretary of the Interior.
Senator Walsh of Montana. Now, in reading this, you may omit the formal portion.
Mr. FINNEY. On December 20, 1924, on appeal, I rendered the decision which I will put in the record.
Senator Walsh of Montana. Before we go to that Mr. Finney, can you tell us who actually wrote the opinion bearing the signature of Commissioner Spry?
Mr. FINNEY. I do not know whether it shows the initials or not. No, sir; this copy I have does not show the initials.
Senator Walsh of Montana. In the ordinary procedure of the office, who would be likely to have written the opinion?
Mr. FINNEY. It would be prepared by one of the examiners in the mineral division, Mr. Jones-I am told by Mr. Goerner-who is in that division and as you know, the practice is to have the decision reviewed by the chief of the division and then it passes to a board of law review, and from the board of law review to the commissioner. That is the ordinary procedure.
Senator Walsh of Montana. Who constituted the board of law review at that time?
Mr. FINNEY. John McPhaul; Millrick, now dead; Mr. Lewis, now dead; Mr. Altizer, who is still in the land office. Now, some of that board unquestionably reviewed the decision because that was the practice.
May I proceed, Senator?
Senator KENDRICK. When these claims were filed, one for mineral and one for homesteads, was it consistent with your regulations, or the law, to file both claims on the same land subject to the mineral restrictions in one and the surface rights on the other?
Mr. FINNEY. Let me answer that in this way, Senator. There is a law of 1914 which permits the entry of the surface or mineral lands with a reservation of the minerals to the Government. Then, the stock-raising homestead law has a separate provision of its own whereby all minerals under a stock-raising entry are reserved to the Government. The law says those reserved minerals underneath are to be disposed of as may be directed by Congress. Therefore, if a homesteader got his patent with that sort of a reservation, and no other law had been passed by Congress, those minerals would just lie there for future disposition. But, in this case, the mineral claimant claimed and the record shows that his location was made prior to either of the homestead entries, that he had maintained it meanwhile and was in possession of it. Consequently, if his claim was a valid one, and could be carried through under the law, he would become entitled to a patent not only for the surface but for all the minerals in the land.
Senator WALSH of Montana. Senator Kendrick, there is a further consideration entirely aside from these statutes. You see, the mineral claimant does not make any filing in the land office at all. A placer mining claimant makes his location and files his notice of location in the office of the county recorder or register of deeds, and then a homestead claimant comes along and goes to the land office to make his filing, and, so far as the land office records disclose, there is no filing on the land at all, so they accept his homestead filing and the mineral claimant's filing is in the office of the county recorder and the homestead claimant's filing is in the land office.
Senator Glenx. Then, in that case, such as you relate, the homestead, if granted, would be subject to the mineral claim if it was likewise granted. Is that correct?
Senator Walsh of Montana. That is the case under the law of 1914. These lands were classified as mineral lands and the land office would not accept his filing execpt subject to the mineral rights.
Senator KENDRICK. Well, in determining more directly the answer, defining more directly the answer, to my question, at the time the homesteader filed on his stock-raising homestead, this land had not been withdrawn as a mineral bed, had it?
Mr. Finney. Yes, sir; it had been classified as valuable for shale by the Department in 1916 and the mineral locators had located the land under the placer laws, and put their locations on record in the county recorder's office.
Senator KENDRICK. Had it been withdrawn from entry?
Mr. FINNEY. No; it had not been reserved in the sense of a reservation.
Senator KENDRICK. Do you recall a long contested case in the Salt Creek field over stock-raising homesteads?
Mr. FINNEY. Yes. Well, that was a different proposition. It was a case where the Salt Creek field was producing and had been designated by the Geological Survey as a producing structure and our department held that a stock-raising homestead entry could not be allowed within the limits of that producing oil structure because the stock-raising law did not permit entry of reserved lands.
Senator KENDRICK. Exactly. In this case, as I understand it, any filing on a homestead, any filing made for homestead purposes, which involved the surface rights only, would have precluded any possible claim on the part of the homesteader to the minerals, is that right?
Mr. FINNEY. Yes, sir; because they were reserved either by his waiver or by the provisions of the law itself.
Senator KENDRICK. So that, in one sense of the word, as I see the picture, these two claims need not have been in conflict.
Mr. FINNEY. Only on this, as I tried to point out. If there had been no mining location there prior to 1920, and the homesteader had gotten his surface patent, there could have been no dispute as to the underlying minerals, except under the leasing act.
Senator KENDRICK. Of course not, but that was not the situation.
Mr. FINNEY. We also held that there was no warrant for allowing a mineral location of land, the surface of which had been patented under the homestead law.
Senator KENDRICK. I understand that. I am only trying to determine the exact situation when the filings were made.
Mr. FINNEY. The mineral claimant was already on them and if his claims were valid he had a vested right which could not be taken away from him. If his claims were not valid, that is another story.
Senator KENDRICK. The way it actually occurred, Judge, was it necessary for there to have been involved any conflict between the mineral locator and the homesteader?
Mr. FINNEY. Yes, sir; because the mineral locator, if his claim was valid, was entitled to, and he claimed the whole thing, surface minerals and all.
Senator Walsh of Montana. Will you kindly proceed with the opinion of the Secretary!
Mr. FINNEY. You just want the part that relates to discovery?
Senator Walsh of. Montana. Well, I think we better have everything except the formal part, Mr. Finney.
(The preliminary portion of the departmental decision dated December 20, 1924, not read by Mr. Finney, reads as follows:)
DEPARTMENT OF THE INTERIOR,
GENERAL LAND OFFICE,
Washington, January 10, 1931. I hereby certify that the annexed copy of departmental decision dated December 20, 1924, filed under Denver 032576, formerly Glenwood Springs 018825, is a true and literal exemplification of the record on file in this office.
In testimony whereof I have hereunto subscribed my name and caused the seal of this office to be affixed, at the city of Washington, on the day and year above written.
Thos. C. HAVELL, Assistant Commissioner of the General Land Office.
DEPARTMENT OF THE INTERIOR,
Washington, December 20, 1924. A. 6957. J. D. Freeman v. George L. Summers, H. Glenwood Springs 018825,
018827. Homestead entries held for cancellation. Reversed and conflicting mining claims held null and void. Decision promulgated December 27, 1924.
APPEAL FROM THE GENERAL LAND OFFICE
On May 10, 1920, George L. Summers filed application 018825 to make homestead entry under the act of February 19, 1909, subject to the provisions and reservations of the act of July 17, 1914 (38 Stat., 509), for the S. 12. NW. 14, N. 12, SW. 14, sec. 1, S. 142, NE. 14, N. 2, SE. 14, sec. 2,- T. 5 S., R, 97 W., Glenwood Springs, Colo., land district.
On the same date he also filed application to make additional stock-raising homestead entry for lots 3 and 4, S. 12, NW. 14, sec. 2, lots 1, 2, and 3, SE. 44, NE. 44, sec. 3, in the same township and range.
The original entry was allowed on May 17, 1920. The lands applied for under the stock-raising application were designated September 27, 1920, and the entry was allowed January 28, 1921. Combined final proof was submitted on both entries May 22, 1923, and suspended pending the disposition of contests filed by mineral claimants. All the land above described was classified as valuable for petroleum and nitrogen on May 23, 1916.
On May 21, 1923, J. D. Freeman filed application to contest the above-mentioned entries. The grounds of contest alleged are, briefly, that he is the owner of the J. D. Group Nos. 1, 2, 3, 5, and F. D. Group, oil shale placer claims covering certain described portions of the entries mentioned ; that the claims were located and discovery of valuable oil shale made theron April 18, 1918; that at all times since the locators and the contestants who claims title from them, have held, used, occupied, and possessed all the claims except for the interference of Summers ; that they have complied with the mining laws of the United States and the State of Colorado, performed the requisite annual assessment work; that the land has no value save for its oil-shale deposits. The contest affidavit concludes with a request for a hearing, “as to mineral or agricultural character of the lands in conflict,” and for the cancellation of the homestead entries mentioned.
Hearing was ordered and duly held before the local officers on September 5 and 11, 1923, voluminous testimony being submitted by both parties. The local officers rendered a decision in favor of the contestee and held:
" That no actual discovery of oil shale has been made on the land in controversy, a requirement of the law (Remis v. Murray, 22 L. D., 409) although it must be admitted that is apparently an unnecessary requirement where oir hale claims are in consideration. That these claims had been allowed to lapse and were so lapsed at the time of the passage of the leasing act, February 25, 1920. That sufficient assessment work has at no time been done to hold. these claims valid."
l'pon the question of discovery the local officers find
* While there appears to be no question but that immense shale beds underlie this land at considerable depth, it is just as clear that the higher strata exposed on the Summers place and on which discovery is claimed, do not now constitute valuable deposits and by development in the future could not to be expected to show such value as to make them merchantable."
By decision of April 8, 1924, the Commissioner of the General Land Office reversed the local officers, held the homestead entry for cancellation to the extent of their conflict with the mining claims in question. In support of this action the commissioner found that:
" It clearly appears that the lands in question, along with a large area of other land in that vicinity are mineral in character and valuable as a source of petroleum and nitrogen; that oil shale was discovered thereon and that they were located, surveyed, staked, and filed upon by contestant and his grantors long before the entries in conflict were made. It also appears that a certain amount of assessment work, said to be the required amount for each year, has been done on and for the benefit of each of said claims and that their future development for the mineral contained therein is justified."
Mr. FINNEY (reading):
After a careful examination of the whole record, the department is of the opinion that a great amount of testimony was taken to establish facts of minor importance and support issues not controlling or decisive; that in the decision complained of, undue consideration was given to certain facts and rules of law that have little bearing on the legal situation developed. For these reasons it appears advisable for the sake of clarity to make a statement of what the department conceives to be the principal issues and questions that have arisen on the facts developed in this record.
First, it appears obvious, that all minerals being reserved from the stockraising entry, and certain minerals including oil shale from the enlarged homestead entry, proof merely that the land is valuable for its oil shale deposits in no way defeats or affects the entryman's homestead rights; though evidence to that effect, or to the contrary, may have a material bearing in determining whether a discovery had been made on a mining claim.
Second, the action of the commissioner holding the homestead entries for cancellation to the extent of the area in conflict can be justified only in the event that it is shown that the alleged placer mining claims are valid.
Third, if the claims were validated by discovery, under section 2522-
This is not the right section number. Revised Statutes, the mineral claimants are entitled to the exclusive right of possession and enjoyment of all the surface of the claims included within the lines of their locations. Belk v. Meagher (104 U. S., 279) : Clipper Min. Co. 1. Eli Min. Co. et al. (194 U. S., 220); Noyes v. Mantle (127 U. S. 351). And even though no discovery had been made a mineral claimant may hold a claim in which he may be working against all others having no better right, while he remains in possession, diligently working toward discovery and is entitled--at least for a reasonable time to be protected against forcible, fraudulent, and clandestine intrusions upon his possession. Union Oil Co. v. Smith (249 U. S., 347).
Fourth, in order that any of these claims may be considered valid it must appear from the evidence that the claimants thereof had, at the date of the leasing act, to wit, February 25, 1920, made a discovery of a valuable deposit of minerals thereon, or if no such discovery had been made at that time, that they were then diligently engaged in the prosecution of work on behalf of said claim leading to a discovery and that such work was continued diligently to the date the homestead rights of Summers would have otherwise attached to the land within the claim. McGee v. Wooten (48 L. D., 147); McLemore 1. Express Oil Company (112 Pac., 59); Union Oil Company v. Smith, supra.
Fifth, the discovery must have been made within the limits of the claim as located. U. S. Compiled Statutes, vol. 5, sec. 4615, note 42, and case there cited.