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The general mining law of 1872 permits citizens to explore the public domain and search for minerals and, if they discover "valuable mineral deposits," to obtain title to the land on which such deposits are located. The Mineral Leasing Act (Act), enacted in 1920, withdrew oil shale from the general mining law and provided that thereafter oil shale would be subject to disposition only through leases, except that a savings clause preserved valid claims existent at the date of passage of the Act. Upon complaints by the Department of the Interior (Department) alleging that respondents' claims for oil shale deposits located prior to the Act were invalid, a hearing examiner ruled the claims valid on the ground that the Department's 1927 decision in Freeman v. Summers, 52 L. D. 201, wherein it was held that "present marketability" is not a prerequisite to the patentability of oil shale deposits as "valuable mineral deposits," compelled the conclusion that oil shale is a valuable mineral subject to appropriation under the mining laws, despite substantial evidence that oil shale operations were commercially infeasible. The Board of Land Appeals reversed, holding that oil shale claims located prior to 1920 failed the test of value because at the time of location there did not appear as a present fact a reasonable prospect of success in developing an operating mine that would yield a reasonable profit. It rejected prior departmental precedent, particularly Freeman v. Summers, as being inconsistent with the general mining law and therefore unsound. On appeal, the District Court reversed and held the claims valid, finding that Congress had implicitly "ratified" the rule of Freeman v. Summers, and that in any event the Department was stopped from departing from the longstanding Freeman standard. The Court of Appeals affirmed.
The oil shale deposits in question are "valuable mineral deposits" patentable under the Act's savings clause. The Act's history and the developments subsequent to its passage indicate that the Government should not be permitted to invalidate pre-1920 oil shale claims by imposing a present marketability requirement on such claims. The Department's original position, as set forth in Instructions, issued shortly after the Act became law, authorizing the General Land Office [446 U.S. 657, 658] to begin adjudicating applications for patents for pre-1920 oil shale claims, and later enunciated in Freeman v. Summers, is the correct view of the Act as it applies to the patentability of pre-1920 oil shale claims. Pp. 663-673.
591 F.2d 597, affirmed.
BURGER, C. J., delivered the opinion of the Court, in which WHITE, BLACKMUN, POWELL, REHNQUIST, and STEVENS, JJ., joined. STEWART, J., filed a dissenting opinion, in which BRENNAN and MARSHALL, JJ., joined, post, p. 673.
Deputy Solicitor General Wallace argued the cause for petitioner. On the briefs were Solicitor General McCree, Assistant Attorney General Moorman, Deputy Solicitor General Clairborne, Mark I. Levy, Dirk D. Snel, and Robert L. Klarquist.
Fowler Hamilton argued the cause for respondents. With him on the brief were Richard W. Hulbert, Donald L. Morgan, H. Michael Spence, Claron C. Spencer, and Norma L. Comstock.
MR. CHIEF JUSTICE BURGER delivered the opinion of the Court.
The general mining law of 1872, 30 U.S.C. 22 et seq., provides that citizens may enter and explore the public domain, and search for minerals; if they discover "valuable mineral deposits," they may obtain title to the land on which such deposits are located. 1 In 1920 Congress altered this [446 U.S. 657, 659] program with the enactment of the Mineral Leasing Act. 41 Stat. 437, as amended, 30 U.S.C. 181 et seq. The Act withdrew oil shale and several other minerals from the general mining law and provided that thereafter these minerals would be subject to disposition only through leases. A savings clause, however, preserved "valid claims existent at date of the passage of this Act and thereafter maintained in compliance with the laws under which initiated, which claims may be perfected under such laws, including discovery." 2
The question presented is whether oil shale deposits located prior to the 1920 Act are "valuable mineral deposits" patentable under the savings clause of the Act.
The action involves two groups of oil shale claims located by claimants on public lands in Garfield County, Colo., prior to the enactment of the Mineral Leasing Act. 3 The first group of claims, designated Mountain Boys Nos. 6 and 7, was located in 1918. In 1920, a business trust purchased the claims for $25,000, and in 1924 an application for patent was filed with [446 U.S. 657, 660] the Department of the Interior. Some 20 years later, after extended investigative and adjudicatory proceedings, the patent was rejected "without prejudice" on the ground that it was not then vigorously pursued. In 1958, Frank W. Winegar acquired the claims and filed a new patent application. In 1964, Winegar conveyed his interests in the claims to respondent Shell Oil Company.
The second group of claims, known as Harold Shoup Nos. 1-4, was located in 1917. In 1923, the claims were acquired by Karl C. Schuyler who in 1933 bequeathed them to his surviving spouse. In 1960, Mrs. Schuyler incorporated respondent D. A. Shale, Inc., and transferred title to the claims to the corporation. Three months later, the corporation filed patent applications.
In 1964, the Department issued administrative complaints alleging that the Mountain Boys claims and the Shoup claims were invalid. The complaints alleged, inter alia, that oil shale was not a "valuable mineral" prior to the enactment of the 1920 Mineral Leasing Act.
The complaints were consolidated and tried to a hearing examiner who in 1970 ruled the claims valid. The hearing examiner observed that under established case law the test for determining a "valuable mineral deposit" was whether the deposit was one justifying present expenditures with a reasonable prospect of developing a profitable mine. See United States v. Coleman, 390 U.S. 599 (1968); Castle v. Womble, 19 L. D. 455 (1894). 4 He then reviewed the history [446 U.S. 657, 661] of oil shale operations in this country and found that every attempted operation had failed to show profitable production. On the basis of this finding and other evidence showing commercial infeasibility, the hearing examiner reasoned that "[i]f this were a case of first impression," oil shale would fail the "valuable mineral deposit" test. However, he deemed himself bound by the Department's contrary decision in Freeman v. Summers, 52 L. D. 201 (1927). There, the Secretary had written:
The Board of Land Appeals reversed. Adopting the findings of the hearing examiner, the Board concluded that oil shale claims located prior to 1920 failed the test of value because at the time of location there did not appear "as a present fact . . . a reasonable prospect of success in developing an operating mine that would yield a reasonable profit." (Emphasis in original.) The Board recognized that this conclusion was at odds with prior departmental precedent, and [446 U.S. 657, 662] particularly with Freeman v. Summers; but it rejected that precedent as inconsistent with the general mining law and therefore unsound. The Board then considered whether its newly enunciated interpretation should be given only prospective effect. It found that respondents' reliance on prior rulings was minimal and that the Department's responsibility as trustee of public lands required it to correct a plainly erroneous decision. 5 Accordingly, it ruled that its new interpretation applied to the Mountain Boys and Shoup claims, and that those claims were invalid.
Respondents appealed the Board's ruling to the United States District Court for the District of Colorado. The District Court agreed with the Board that by not requiring proof of "present marketability" the decision in Freeman v. Summers had liberalized the traditional valuable mineral test. But it found that Congress in 1931 and again in 1956 had considered the patentability of oil shale and had implicitly "ratified" that liberalized rule. Alternatively, the District Court concluded that the Department was stopped now from departing from the Freeman standard which investors had "relied upon . . . for the past half-century." Shell Oil Co. v. Kleppe, 426 F. Supp. 894, 907 (1977). On these grounds, it reversed the Board's ruling and held that the claims at issue were valid.
The Court of Appeals for the Tenth Circuit affirmed. 591 F.2d 597 (1979). It agreed with the District Court that the "different treatment afforded all oil shale claims as to the `valuable mineral deposit' element of a location became a part of the general mining laws by reason of its adoption and approval [446 U.S. 657, 663] by both Houses of Congress" in the years after 1920. Id., at 604. And it held that the Department now must adhere to the Freeman rule. We granted certiorari because of the importance of the question to the management of the public lands. 444 U.S. 822 (1979). We affirm.
The legislative history of the 1920 Mineral Leasing Act shows that Congress did not consider "present marketability" a prerequisite to the patentability of oil shale. 6 In the extensive hearings and debates that preceded the passage of the 1920 Act, there is no intimation that Congress contemplated such a requirement; indeed, the contrary appears. During the 1919 floor debates in the House of Representatives, an amendment was proposed which would have substituted the phrase "deposits in paying quantities" for "valuable mineral." That amendment, however, was promptly withdrawn after Mr. Sinott, the House floor manager, voiced his objection to the change:
To be sure, prior to the passage of the 1920 Act, there existed considerable uncertainty as to whether oil shale was patentable. 7 That uncertainty, however, related to whether oil shale was a "mineral" under the mining law, and not to its "value." Similar doubts had arisen in the late 19th century [446 U.S. 657, 665] in regard to petroleum. Indeed, in 1986 the Secretary of the Interior had held that petroleum claims were not subject to location under the mining laws, concluding that only lands "containing the more precious metals . . . gold, silver, cinnabar etc." were open to entry. Union Oil Co., 23 L. D. 222, 227. The Secretary's decision was short-lived. In 1897, Congress enacted the Oil Placer Act authorizing entry under the mining laws to public lands "containing petroleum or other mineral oils." Ch. 216, 29 Stat. 526. This legislation put to rest any doubt about oil as a mineral. But because oil shale, strictly speaking, contained kerogen and not oil, see n. 3, supra, its status remained problematic. See Reidy, Do Unpatented Oil Shale Claims Exist?, 43 Denver L. J. 9, 12 (1966).
That this was the nature of the uncertainty surrounding the patentability of oil shale claims is evident from remarks made throughout the hearings and debates on the 1920 Act. In the 1918 hearings, Congressman Barnett, for example, explained:
Our conclusion that Congress in enacting the 1920 Mineral Leasing Act contemplated that pre-existing oil shale claims could satisfy the discovery requirement of the mining law is confirmed by actions taken in subsequent years by the Interior Department and the Congress. 8
On May 10, 1920, less than three months after the Mineral Leasing Act became law, the Interior Department issued "Instructions" to its General Land Office authorizing that Office to begin adjudicating applications for patents for pre-1920 oil shale claims. The Instructions advised as follows:
In 1927, the Department decided Freeman v. Summers, 52 L. D. 201. The case arose out of a dispute between an oil shale claimant and an applicant for a homestead patent, and involved two distinct issues: (1) whether a finding of lean surface deposits warranted the geological inference that the claim contained rich "valuable" deposits below; and (2) whether present profitability was a prerequisite to patentability. Both issues were decided in favor of the oil shale claimant: the geological inference was deemed sound and the fact that there was "no possible doubt . . . that [oil shale] constitutes an enormously valuable resource for future use by the American people" was ruled sufficient proof of "value." Id., at 206.
For the next 33 years, Freeman was applied without deviation. 9 It was said that its application ensured that "valid rights [would] be protected and permitted to be perfected." Secretary of Interior Ann. Rep. 30 (1927). In all, 523 patents for 2,326 claims covering 349,088 acres were issued under the Freeman rule. This administrative practice, begun immediately upon the passage of the 1920 Act, "has peculiar weight [because] it involves a contemporaneous construction [446 U.S. 657, 668] of [the] statute by the men charged with the responsibility of setting its machinery in motion," Norwegian Nitrogen Products Co. v. United States, 288 U.S. 294, 315 (1933). Accord, e. g., United States v. National Assn. of Securities Dealers, 422 U.S. 694, 719 (1975); Udall v. Tallman, 380 U.S. 1, 16 (1965). It provides strong support for the conclusion that Congress did not intend to impose a present marketability requirement on oil shale claims.
In 1930 and 1931, congressional committees revisited the 1920 Mineral Leasing Act and re-examined the patentability of oil shale claims. Congressional interest in the subject was sparked in large measure by a series of newspaper articles charging that oil shale lands had been "improvidently, erroneously, and unlawfully, if not corruptly, transferred to individuals and private corporations." 74 Cong. Rec. 1079 (1930) (S. Res. 379). The articles were based upon accusations leveled at the Interior Department by Ralph S. Kelly, then the General Land Office Division Inspector in Denver. Kelly's criticism centered on the Freeman v. Summers decision. Fearing another "Teapot Dome" scandal, the Senate authorized the Committee on Public Lands to "inquire into . . . the alienation of oil shale lands."
The Senate Committee held seven days of hearings focusing almost exclusively on "the so-called Freeman-Summers case." Hearings on S. Res. 379 before the Senate Committee on Public Lands and Surveys, 71st Cong., 3d Sess., 2 (1931). At the outset of the hearings, the Committee was advised by E. C. Finney, Solicitor, Department of the Interior, that 124 oil shale patents had been issued covering 175,000 acres of land and that 63 more patent applications were pending. Finney's statement prompted this interchange:
At virtually the same time, the House of Representatives commenced its own investigation into problems relating to [446 U.S. 657, 670] oil shale patents. The House Committee, however, focused primarily on the question of assessment work - whether an oil shale claimant was required to perform $100 work per year or forfeit his claim - and not on discovery. But the impact of the Freeman rule was not lost on the Committee:
In 1956 Congress again turned its attention to the patentability of oil shale. That year it amended the mining laws by eliminating the requirement that locators must obtain and convey to the United States existing homestead surface-land patents in order to qualify for a mining patent on minerals withdrawn under the 1920 Mineral Leasing Act. See Pub. L. 743, 70 Stat. 592. Where a surface owner refused to cooperate with the mining claimant and sell his estate, this requirement prevented the mining claimant from patenting his claim. See James W. Bell, 52 L. D. 197 (1927). In hearings on the amendment, it was emphasized that oil shale claimants would be principal beneficiaries of the amendment:
The position of the Government in this case is not without a certain irony. Its challenge to respondents' pre-1920 oil shale claims as a "nonvaluable" comes at a time when the value of such claims has increased sharply as the Nation searches for alternative energy sources to meet its pressing needs. If the Government were to succeed in invalidating old claims and in leasing the lands at public auction, the Treasury, no doubt, would be substantially enriched. However, the history of the 1920 Mineral Leasing Act and developments subsequent to that Act persuade us that the Government cannot achieve that end by imposing a present marketability [446 U.S. 657, 673] requirement on oil shale claims. 11 We conclude that the original position of the Department of the Interior, enunciated in the 1920 Instructions and in Freeman v. Summers, is the correct view of the Mineral Leasing Act as it applies to the patentability of those claims. 12
The judgment of the Court of Appeals is
[ Footnote 2 ] The savings clause is contained in 37 of the Act, 41 Stat. 451, as amended, which, as set forth in 30 U.S.C. 193, provides in full:
[ Footnote 3 ] Oil shale is a sedimentary rock containing an organic material called kerogen which, upon destructive distillation, produces a substantial amount of oil.
[ Footnote 4 ] In Chrisman v. Miller, 197 U.S. 313 (1905), this Court approved the Department of the Interior's "prudent-man test" under which discovery of a "valuable mineral deposit" requires proof of a deposit of such character that "a person of ordinary prudence would be justified in the further expenditure of his labor and means, with a reasonable prospect of success, in developing a valuable mine." Castle v. Womble, 19 L. D., at 457. Accord, Best v. Humboldt Placer Mining Co., 371 U.S. 334, 335 -336 (1963); Cameron v. United States, 252 U.S. 450, 459 (1920). In United States v. Coleman, the Court approved the Department's marketability [446 U.S. 657, 661] test - whether a mineral can be "extracted, removed and marketed at a profit" - deeming it a logical complement of the prudent-man standard.
[ Footnote 5 ] The Board observed that "[a]lthough Shell . . . expended some $18,780 in perfecting title to and preparing patent application for the Mountain Boy claims before 1964, it did not purchase [the claims] from Frank Winegar for $30,000 [until] after initiation of the contest proceedings." And it found no evidence that D. A. Shale, Inc., or its predecessors had invested "more than a minimal amount" in the purchase of the Shoup claims in reliance on the Freeman decision.
[ Footnote 6 ] Congress was aware that there was then no commercially feasible method for extracting oil from oil shale. The 1918 Report of the House Committee on the Public Lands, for example, had emphasized that
[ Footnote 7 ] Mr. John Fry, one of the Committee witnesses who represented the oil shale interests before Congress, was candid on that point:
[ Footnote 8 ] This Court has observed that "the views of a subsequent Congress form a hazardous basis for inferring the intent of an earlier one." United States v. Price, 361 U.S. 304, 313 (1960). This sound admonition has guided several of our recent decisions. See, e. g, TVA v. Hill, 437 U.S. 153, 189 -193 (1978); SEC v. Sloan, 436 U.S. 103, 119 -122 (1978). Yet we cannot fail to note Mr. Chief Justice Marshall's dictum that "[w]here the mind labours to discover the design of the legislature, it seizes every thing from which aid can be derived." United States v. Fisher, 2 Cranch 358, 386 (1805). In consequence, while arguments predicated upon subsequent congressional actions must be weighed with extreme care, they should not be rejected out of hand as a source that a court may consider in the search for legislative intent. See, e. g., Seatrain Shipbuilding Corp. v.Shell Oil Co., 444 U.S. 572, 596 (1980); Red Lion Broadcasting Co. v. FCC, 395 U.S. 367, 380 -381 (1969); NLRB v. Bell Aerospace Co., 416 U.S. 267, 274 -275 (1974).
[ Footnote 9 ] See, e. g., John M. Debevoise, 67 I. D. 177, 180 (1960); United States v. Strauss, 59 I. D. 129, 140-142 (1945); Location of Oil Shale Placer Claims, 52 L. D. 631 (1929); Assessment Work on Oil-Shale Claims, 52 L. D. 334 (1928); Standard Shales Products Co., 52 L. D. 522 (1928); James W. Bell, 52 L. D. 197 (1927).
[ Footnote 10 ] At the conclusion of its hearings, the Committee recommended legislation placing a deadline on the filing of patent applications for oil shale claims and permitting an oil shale claimant to pay $100 a year to the Land Office in lieu of $100 in annual assessment work. Other aspects of the oil shale patentability - including the question of discovery - were [446 U.S. 657, 671] not addressed in the proposed legislation. H. R. Rep. No. 2537, 71st Cong., 3d Sess. (1931). The proposal was not enacted by the Congress.
[ Footnote 11 ] This history indicates only that a present marketability standard does not apply to oil shale. It does not affect our conclusion in United States v. Coleman that for other minerals the Interior Department's profitability test is a permissible interpretation of the "valuable mineral" requirement. See n. 4, supra.
[ Footnote 12 ] The dissent overlooks the abundant evidence that Congress since 1920 has consistently viewed oil shale as a "valuable mineral" under the general mining law. The dissent dismisses the 1931 hearings and the 1956 Act as irrelevancies: as for the 1931 hearings, the dissent states that "not a single remark by a Senator or Representative" approved the Freeman standard; as for the 1956 Act, we are informed that Congress "dealt with [a] totally unrelated problem." Post, at 676. Neither of these observations is correct. The 1931 Senate hearings were called specifically to review the Freeman case for fear that another "Teapot Dome" scandal was brewing. Rarely has an administrative law decision received such exhaustive congressional scrutiny. And following that scrutiny, no action was taken to disturb the settled administrative practice; rather Senator Nye advised the Interior Department to continue patenting oil shale claims. Similarly, to characterize the 1956 Act as "totally unrelated" is to blink reality. The patentability of oil shale land was an essential predicate to that legislation; if oil shale land was nonpatentable then Congress performed a useless act.
The dissent also overlooks that beginning in 1920 and continuing for four decades, the Interior Department treated oil shale as a "valuable mineral." In paying deference to the doctrine that a "contemporaneous [administrative] construction . . . is entitled to substantial weight," post, at 676, the dissent ignores this contemporaneous administrative practice. The best evidence of the 1920 standard of patentability is the 1920 Interior [446 U.S. 657, 674] Department practice on the matter. The suggestion of the dissent that "future events [such] as market changes" were not meaningful data under the Castle v. Womble test, post, at 678, is inaccurate. As a leading treatise has observed, "[t]he future value concept of Freeman v. Summers is nothing more than the `reasonable prospect of success' of Castle v. Womble, and the reference to `present facts' in Castle v. Womble . . . relates to the existence of a vein or lode and not to its value." 1 Rocky Mountain Mineral Law Foundation, The American Law of Mining 4.76, p. 697, n. 2 (1979).
MR. JUSTICE STEWART, with whom MR. JUSTICE BRENNAN and MR. JUSTICE MARSHALL join, dissenting.
Oil shale was patentable under the general mining law from [446 U.S. 657, 674] 1872 until 1920. 1 In 1920, Congress enacted the Mineral Leasing Act, 30 U.S.C. 181 et seq. That legislation withdrew oil shale and certain other minerals from the general mining law, but preserved "valid claims existent at date of the passage of this Act and thereafter maintained in compliance with the laws under which initiated, which claims may be perfected under such laws, including discovery." Act of Feb. 25, 1920, ch. 85, 37, 41 Stat. 451, as amended, 30 U.S.C. 193.
The question presented in this case is whether oil shale claims brought under this saving clause of the Mineral Leasing Act must satisfy the usual standards of patentability, or instead may be patented through the use of a "discovery" standard different from that which generally applies. The Court's answer is that a different and more relaxed standard is applicable. I disagree. Since I believe that pre-1920 oil shale claims must fulfill the then firmly established requirements of patentability for all valuable minerals under the general mining law, I respectfully dissent from the opinion and judgment of the Court.
There is not one shred of evidence that Congress enacted the saving clause of the Mineral Leasing Act with the purpose of exempting oil shale claims from the usual requirements of patentability. On its face, the 1920 version of the [446 U.S. 657, 675] provision applied with identical effect to "coal, phosphate, sodium, oil, oil shale, and gas," and required that all outstanding valid claims to such minerals meet the existing standards of the mining law in order to be perfected.
Nothing in the Act's legislative history suggests anything to the contrary. Descriptions by legislators of the saving clause drew no distinction between oil shale and other covered claims. See, e. g., 59 Cong. Rec. 2711-2712 (1920) (Rep. Taylor); 58 Cong. Rec. 7780-7781 (1919). 2 In the face of conflicting evidence on the subject, Congress may well have thought that many oil shale claims would meet the traditional criteria of patentability. But it did not accord such claims any special legislative treatment.
Equally unambiguous are the Instructions which the Secretary of the Interior published three months after passage of the Act. These expressly stated:
The saving clause of the Mineral Leasing Act thus directs that the validity of all claims brought thereunder - including those relating to oil shale - must be judged according to the general criteria of patentability that were established in the mining law as of 1920. And I am convinced that nothing that Congress has done since 1920 can be read to have modified this mandate.
The Court points to congressional committee hearings that were held in 1931 on the Secretary's 1927 Freeman v. Summers decision, and notes that there resulted from this inquiry no legislative rejection of the Department's then prevailing generous treatment of oil shale claims. But of far greater significance, in my opinion, is the fact that not a single remark by a Senator or Representative, let alone by a congressional committee, can be found approving the liberal standard enunciated in Freeman v. Summers, 52 L. D. 201, even though such a statement could not, in any event, have overridden the plain meaning of the saving clause of the Mineral Leasing Act. See TVA v. Hill, 437 U.S. 153, 191 -193; SEC v. Sloan, 436 U.S. 103, 121 .
The Court purports to find support for its position in legislation enacted by Congress in 1956. But that legislation dealt with the totally unrelated problem of competing surface and mineral estates, and has nothing to do with the question at issue here. See Pub. L. 743, 70 Stat. 592; S. Rep. No. 2524, 84th Cong., 2d Sess. (1956); H. R. Rep. No. 2198, 84th Cong., 2d Sess. (1956).
The only reasonable inference that can be drawn from the events of 1931 and 1956 is that on those two occasions, as in 1920, Congress declined to assume that every pre-1920 oil [446 U.S. 657, 677] shale claim would turn out to be unpatentable. It seems to me wholly fallacious to interpret these indications of caution as a congressional intent to exempt oil shale claims from longstanding principles of patentability.
The respondents' patent applications were, I think, quite properly rejected at the administrative level for the simple reason that they failed to satisfy the requirements of the general mining law as of 1920. By 1920, the law was clear that a mineral land patent could issue only when the applicant had made a "discovery" of a "valuable mineral deposit." Union Oil Co. v. Smith, 249 U.S. 337, 346 (1919). Through departmental and judicial decisions, it had been further established that a "discovery" occurs only when minerals are found in such quantity and quality as to justify a prudent man to expend his labor and means with a reasonable prospect of success in developing a valuable mine. Chrisman v. Miller, 197 U.S. 313, 321 -323 (1905); H. H. Yard, 38 L. D. 59, 70 (1909); Castle v. Womble, 19 L. D. 455, 457 (1894). See Cameron v. United States, 252 U.S. 450, 459 (1920); Casey v. Northern Pacific R. Co., 15 L. D. 439, 440 (1892).
Of controlling significance here is the fact that, by 1920, two refinements of this "prudent man test" had occurred. First, it was clear that, although the patent applicant did not have to demonstrate that his mining efforts would definitely yield some profit, 3 he at least had to show that they probably would. Cataract Gold Mining Co., 43 L. D. 248, 254 (1914). See Cole v. Ralph, 252 U.S. 286, 299 (1920); Cameron v. United States, supra, at 459; United States v. Iron Silver Mining Co., 128 U.S. 673, 684 (1884). 4 Second, [446 U.S. 657, 678] this required showing of probable profitability had to rest primarily on presently demonstrable, not speculative, fact. See Davis's Administrator v. Weibbold, 139 U.S. 507, 521 -524 (1891); Castle v. Womble, supra, at 457 ("the requirement relating to discovery refers to present facts, and not to the probabilities of the future"); Casey v. Northern Pacific R. Co., supra, at 440; Winters v. Bliss, 14 L. D. 59, 62 (1892). Thus, the applicant could not satisfy the applicable standard by pointing to such highly uncertain future events as market changes or technological advances in an attempt to demonstrate a reasonable prospect of success.
Each of these principles had developed rather naturally out of the "prudent man" rule of Castle v. Womble, supra. For land to be deemed "valuable" for mining purposes, and for a prudent man to decide to expend his time and money in developing a mine upon that land, it was quite rational to require a showing of a reasonable prospect that the mine would yield a profit. See Cataract Gold Mining Co., supra, at 254. The Court is simply mistaken in suggesting that the general mining law was in any way otherwise in 1920.
With respect to the oil shale deposits at issue in this case, the Board of Land Appeals found that they "never have been a valuable mineral deposit within the meaning of the general [446 U.S. 657, 679] mining law." The Board based this conclusion on the following factual findings:
For the reasons stated, I do not agree. Accordingly, I would set aside the judgment of the Court of Appeals.
[ Footnote 1 ] Rev. Stat. 2319 et seq., as amended, 30 U.S.C. 22 et seq. See Union Oil Co. v. Smith, 249 U.S. 337, 345 -346.
[ Footnote 2 ] The Court's discussion of a 1919 attempt to substitute "deposits in paying quantities" for "valuable mineral" in a provision of the prospective Mineral Leasing Act, and Representative Sinott's response thereto, see ante, at 663-664, has absolutely nothing to do with the issue at hand. The attempted substitution concerned a provision of the prospective Act that set out the circumstances under which exploratory permits would be allowed for oil and gas deposits under the new leasing scheme. See 58 Cong. Rec. 7536-7537 (1919). Thus, the legislative discussion quoted by the Court did not involve oil shale, the requirements of the general mining law, or the Act's saving clause. See id., at 7780-7781.
[ Footnote 3 ] See East Tintic Consolidated Mining Co., 43 L. D. 79, 81-82 (1914).
[ Footnote 4 ] See also Royal K. Placer, 13 L. D. 86, 89-90 (1891); Tinkham v. McCaffrey, 13 L. D. 517, 518 (1891). The authorities cited by the Court, ante, at 664, do not support a contrary rule. They state that an applicant [446 U.S. 657, 678] for a mineral patent need not establish with certainty that a paying mine exists or can be developed on his land, but they do not in any way reject the rule of Castle v. Womble, 19 L. D. 455, 457 (1894), that the applicant must show that there exists a "reasonable prospect of success" in his developing a profitable mine. See Cascaden v. Bartolis, 146 F. 739, 741-742 (CA9 1906); United States v. Ohio Oil Co., 240 F. 996, 998-1004 (Wyo. 1916); Montana Cent. R. Co. v. Migeon, 68 F. 811, 814-818 (CC Mont. 1895); Book v. Justice Mining Co., 58 F. 106, 120, 123-125 (CC Nev. 1893); Madison v. Octave Oil Co., 154 Cal. 768, 771-772, 99 P. 176, 178 (1908); 2 C. Lindley, American Law Relating to Mines and Mineral Lands 336, pp. 768-773 (3d ed. 1914). [446 U.S. 657, 680]
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Citation: 446 U.S. 657
Docket No: No. 78-1815
Argued: January 15, 1980
Decided: June 02, 1980
Court: United States Supreme Court
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