Multiple Use, Inc. v. Morton

• Decision Date: 09 November 1972
• Docket Number: Civ. No. 71-211-PCT-WCF.
• Citation: 353 F. Supp. 184
• Parties: MULTIPLE USE, INC., Plaintiff, v. Rogers C. B. MORTON, Secretary of the Department of the Interior of the United States of America, Defendant.
• Court: U.S. District Court — District of Arizona

353 F. Supp. 184

MULTIPLE USE, INC., Plaintiff, v. Rogers C. B. MORTON, Secretary of the Department of the Interior of the United States of America, Defendant.

Civ. No. 71-211-PCT-WCF.

United States District Court, D. Arizona, Prescott Division.

November 9, 1972.

Hale C. Tognioni, Phoenix, Ariz., for plaintiff.

William C. Smitherman, U. S. Atty., Tucson, Ariz., Alice A. Wright, Asst. U. S. Atty., Phoenix, Ariz., for defendant.

OPINION AND ORDER

FREY, District Judge.

The matter is before the court on cross-motions for summary judgment pursuant to Rule 56 of the Federal Rules of Civil Procedure. Plaintiff's complaint alleges jurisdiction under the Administrative Procedure Act, 5 U.S.C. §§ 701-706, and 28 U.S.C. §§ 1361 and 1391(e), and seeks relief from the administrative decision of the Secretary of the Interior in that the Robe Roye-Martin-Missing Link placer mining claim is alleged to be null and void for lack of discovery of a valuable mineral deposit. United States v. Silverton Mining and Milling Co., IBLA 70-22 (1970). The scope of this court's review, as discussed below, will be to determine if the Secretary's decision is supported by the record as a whole.

Plaintiff (now Multiple Use, Inc., but originally (1) Silverton Mining and Milling Co. and (2) Minerals Technology) contends in its motion:

1. That a discovery of valuable mineral had been made upon the Robe Roye-Martin-Missing Link placer claim, and that said discovery still existed at the time of the hearing;

2. That it is legally entitled to all 103.18 acres included in its patent application.

In its motion defendant contends that:

1. The true test for a discovery of a valuable mineral deposit in accordance with the applicable mining laws was applied in the various proceedings below;

2. There is substantial evidence in the record to support the Secretary's decision that there was not a discovery of valuable mineral deposit;

3. In view of the Secretary's holding that there was no discovery on any part of the amended claim and consequently that the size of the location to be considered for patent was irrelevant, there was no need to determine whether the claim was valid for 20 or 103.18 acres.

FACTUAL HISTORY

The factual history shows that the claim, located within the Prescott National Forest, was originally located as three separate claims. The Robe Roye, covering 20 acres, was located in 1896 by J. M. Green. The Martin claim also covered 20 acres and was located in 1915 by Sam Boblett. In 1933, A. B. Peach and Ziba O. Brown located the approximately 40-acre Missing Link claim. By mesne conveyances E. J. and Pearl Schreck, in 1949, acquired a partial interest in each of the claims. In 1957, the Schrecks brought a quiet title action which established them as "the owners of the whole interest in fee simple" of these three and other mining claims. In 1962, the Schrecks filed a "Notice of Mining Location Amended" which combined the three claims into an association placer claim of 160 acres. The notice named the locators of the three claims and added those of Dorothy O. Peach, Ida H. Brown, and the Schrecks. It also said that the interest of all locators had been quieted in the Schrecks in 1957. On October 13, 1962, the claim, as amended, was conveyed to Dale Moran, who with Sally Moran conveyed it on October 31, 1963, to the Silverton Mining and Milling Co., Inc. On September 23, 1964, Silverton filed an amended location notice in the same form as the first one but reducing the acreage to 103.18 acres.

Silverton then filed an application October 6, 1964, to patent Arizona 034305, the Robe Roye-Martin-Missing Link placer mining claim constituting 103.18 acres, alleging that the claim contained a valuable mineral deposit of placer gold, building stone, sand and gravel. In protest to the patent application, a contest complaint was initiated on behalf of the Forest Service, United States Department of Agriculture, February 1, 1966, alleging, inter alia, that a valid discovery of mineral as required by the mining laws of the United States did not exist within the limits of the claim, and that the present claimant was entitled to only a 20 acre claim rather than 103.18 acres. An evidentiary hearing was held in Prescott, Arizona, December 12, 1966, under a Department of Interior Bureau of Land Management hearing examiner in which the issues were resolved to those substantially as presented above in plaintiff's motion, i. e.:

1. Whether the claim contains acreage in excess of that allowed by the mining laws.

2. Whether there is a mineral deposit of sufficient value on the claim to meet the requirements of the mining laws.

First, taking up the acreage issue, the Hearing Examiner's decision of June 2, 1967, held that the claim could be valid for at most 40 acres, any excess thereof being void.¹ However, he further concluded that the gold values remaining in the placer material in the claim no longer constituted a valuable mineral deposit.² The examiner also found that non-metallic sand, gravel and stone on the claim were common varieties and these materials were not valuable within the meaning of the mining laws prior to the act of July 23, 1955.³ The examiner therefore declared the Robe Roye-Martin-Missing Link placer mining claim null and void for lack of a valuable mineral deposit.

Contestee (plaintiff) appealed to the Bureau of Land Management⁴ which, by decision of December 4, 1968, pointed out that a claim could be valid only for the acreage properly within it at the time of discovery. Thus, if there had been no discovery up to the time of transfer of the claim to the contestee, contestee (as an individual) could hold only 20 acres within a single claim under 30 U.S.C. § 35. Affirming the Hearing Examiner's decision, it then concluded that none of the land within the 103.18 acres had been shown to contain a discovery of a valuable mineral deposit which would satisfy the test for discovery.

Contestee thereafter appealed to the Secretary of Interior in accordance with the provisions of 43 C.F.R. Part 1840. On September 23, 1970, the Board of Land Appeals, under authority delegated by the Secretary of Interior, affirmed the Bureau of Land Management's holding that the areal extent of a claim depends upon its ownership at the time of discovery; that there was no discovery in any part of the amended claim; and that, in view of this holding, there was no need to determine whether or not the claim was valid for 20 or 103.18 acres, stating: "If there is now no discovery sufficient to validate the claim, then it does not matter what area the locator says the claim covers for the claim is invalid whatever its extent."⁵

Thereafter, as previously noted, plaintiff filed a complaint in this court under the Administrative Procedure Act alleging that the Secretary's decision should not be sustained because:

1. It was arbitrary, capricious, and not in accordance with law in that the record discloses no reliable, probative, or substantial evidence in support of the conclusion that there was not a discovery of a valuable mineral deposit within the boundaries of the claims in question.

2. The administrative decisions were erroneous and not in accordance with the law of discovery in that they are based on the Department of Interior's test of discovery which requires proof that the mining claimant will in fact develop a profitable mine, and which exceeds the true test of a discovery of a valuable mineral deposit which merely requires that minerals be found of sufficient quality and quantity to justify a person of ordinary prudence in the further expenditure of his labor and means with a reasonable prospect of success in developing a valuable mine.

3. There is not substantial evidence in the record to support the Board of Land Appeals' decision which affirms the Hearing Examiner's decision that all but 40 acres of the Robe Roye-Martin-Missing Link placer mining claim is void because of being in excess of the acreage allowed by the mining laws. This decision is also contrary to law.

SCOPE OF JUDICIAL REVIEW

Although plaintiff's complaint alleged that jurisdiction is conferred by both the Administrative Procedure Act (supra) and 28 U.S.C. § 1361 (and § 1391(e)), plaintiff's memorandum in support of its motion argues for jurisdiction solely on the basis of the Act. However, the scope of the court's review in this case would not substantially differ whether conducted under the Act or 28 U.S.C. § 1361, action for mandamus. The standard for judicial review was clearly stated in Sanford v. United States, 399 F.2d 693, 694 (9th Cir. 1968), where the Court held:

"No judicial relief from action of the Army Board for Correction of Military Records is available in the absence of a showing that the action was arbitrary or capricious or was unsupported by substantial evidence. The lower court reviewed all documentary evidence submitted by appellant and concluded that appellant had not met his burden of establishing that the Board had acted arbitrarily and that there was substantial evidence to support the Board's decision. We agree" (citations omitted).

The general application of this standard is well supported and has been almost uniformly construed where the review involves the expertise of an administrative agency; i. e., judicial relief is not available unless the administrative action was arbitrary and capricious and unsupported by substantial evidence. As stated by the Supreme Court in Cameron v. United States, 252 U.S. 450, 464, 40 S.Ct. 410, 414, 64 L.Ed. 659 (1920):

"Whether the tract covered by Cameron's location was mineral and whether there had been the requisite discovery were questions of fact, the decision of which by the Secretary of the Interior was conclusive in the absence of fraud or imposition, and none was claimed" (citations omitted).

The scope of judicial review in actions such as this has always been confined to the administrative...