The United States, Plaintiff In Error v. John Gratiot, Robert Burton, Charles Hempstead, and Dickerson Moorehouse, Defendants In Error

• Decision Date: 01 January 1840
• Citation: 14 Pet. 526,39 U.S. 526,10 L.Ed. 573
• Parties: THE UNITED STATES, PLAINTIFF IN ERROR, v. JOHN P. GRATIOT, ROBERT BURTON, CHARLES S. HEMPSTEAD, AND DICKERSON B. MOOREHOUSE, DEFENDANTS IN ERROR
• Court: U.S. Supreme Court

39 U.S. 526

14 Pet. 526

10 L.Ed. 573

THE UNITED STATES, PLAINTIFF IN ERROR, v. JOHN P. GRATIOT, ROBERT BURTON, CHARLES S.

HEMPSTEAD, AND DICKERSON B. MOOREHOUSE,

DEFENDANTS IN ERROR.

January Term, 1840

ON a certificate of division from the Circuit Court of the United States, for the District of Illinois.

On the first day of September, 1834, the defendants entered into the following bond to the United States, having executed the same under their respective hands and seals:

'Know all men by these presents, that we, J. P. B. Gratiot, Robert Burton, D. B. Moorehouse and Charles S. Hempstead, are holden, and stand firmly bound unto the United States of America, or their certain attorney, in the penal sum of ten thousand dollars, current money of the United States, well and truly to be paid unto their treasury; for which payment, well and truly to be made, we, the said J. P. B. Gratiot, Robert Burton, D. B. Moorehouse, and Charles

S. Hempstead, do hereby, jointly and severally, bind ourselves, our heirs, executors, and administrators, and each and every of them, jointly, severally, and firmly, by these presents. Signed with our hands, and sealed with our seals, this first day of September, in the year of our Lord one thousand eight hundred and thirty-four.

'The condition of the above obligation is such, that whereas the said J. P. B. Gratiot, and Robert Burton, have obtained from the agent of the United States a license, bearing date the first day of September, 1834, containing stipulations therein more particularly described, to smelt lead ore. Now, if the said J. P. B. Gratiot, and Robert Burton, shall faithfully and fully execute and comply with the terms and conditions set forth in said license, then, and in that case, this obligation to be void and of no effect, otherwise to remain in full force and virtue.'

At the same time, a paper called a 'License for Smelting,' which was executed by Thomas C. Legate, major of the United States army, superintendent of the lead mines, J. P. B. Gratiot, and Robert Burton, under their hands and seals, was delivered to J. P. B. Gratiot, and Robert Burton, by Major Legate.

'This indenture, made and entered into this first day of September, 1834, between Major T. C. Legate, superintending the United States lead mines, acting under the direction of the Secretary of War, of the first part, and J. P. B. Gratiot, and Robert Burton, of the second part, witnesseth:

'That the said party of the second part, is hereby permitted, by and with the approbation of the President of the United States, to purchase and smelt lead ore at the United States' lead mines, on the Upper Mississippi, for the period of one year, from and after the date hereof, upon the following conditions, viz.:

'1. All purchases, or other acquisitions of ore, ashes, zinc, or lead, to be from persons authorized to work the mines, either as lessees, smelters, or diggers, and from no others; and no ore to be purchased from the leased premises of any person without his permission.

'2. To commence smelting as soon as one hundred thousand pounds of ore are obtained, and to continue it so long as any is on hand; to weigh a charge of ore for the log furnace, and the lead produced from it, when required to do it by the said first party, or his assistant.

'3. To keep a book containing an accurate account of all ore, ashes, or zinc, purchased or otherwise acquired, and of all lead manufactured: which book shall, at all times, be open to inspection of the said first party, or his assistant; and to furnish a transcript or return at the end of every month, (agreeably to a form furnished by the said first party;) which book and returns to be verified on oath if required.

'4. The said second party hereby agrees to pay the first party, for the use of the United States, six pounds of every hundred pounds of all the lead smelted by him, under this indenture, to be

paid monthly in clear, pure lead, at the wareroom on Feber river, or at such other place near the mines as the said first party shall direct, and free of expense to the United States. And the said second party is not to sell, or remove from the places of smelting, in any manner whatever, any lead, until the rent be paid as aforesaid. This condition is subject to the revocation of the government upon giving three months' previous notice; at which time, it will be optional with the licentiate to accept or refuse the new terms. Upon his refusal to accept, then this license shall cease and determine.

'5. The second party is allowed to have as much fuel as will suffice, without waste, for the purpose of this indenture; and to cultivate as much land as will suffice to furnish his teams, &c., with provender.

'6. It is understood and agreed between the aforesaid parties, that the said second party shall not employ, in any manner, any smelter, lessee, or miner, who has forfeited his license, lease, or permit to mine, nor any other person who is at the mines without the authority of the said first party; and the said second party agrees not to employ or harbour the labourers of workmen of another smelter. Sixty days are allowed after the expiration of this license, to close all business under it; but it is understood that no purchase, or hauling of ore is to take place after the license is expired. The bond given for the faithful performance of the contract is to be in full force and virtue until a written settlement is made.

'It is distinctly understood by the said parties, that upon proof being afforded to the first party, that either of the foregoing stipulations have been violated or not complied with, he may declare this indenture null and void, and re-enter and take possession of all the premises as if no such agreement existed.'

In the Circuit Court of the United States for the District of Illinois, the United States instituted an action of debt to December term, 1836, against the defendants, on this bond. The declaration sets forth the bond and condition, and recites the license or contract therein mentioned, and avers that the lessees had, by virtue of the lease, smelted twenty-four hundred thousand pounds of lead, but had failed to execute the conditions stipulated on their part, by altogether refusing to pay to the superintendant, for the use of the United States, the six pounds for every hundred pounds so smelted.

The defendants demurred to the declaration, after oyer of the bond and licence for smelting; and on the argument of the demurrer, the following question arose, upon which the judges of the Circuit Court were divided in opinion, and directed it to be certified to this Court: 'Whether the President had power, under the act of the 3d of March, 1807, (2 Story's Laws, 1065. 1068,) to make the contract set forth in the declaration.'

The case was argued for the United States, by Mr. Gilpin, Attorney General; and by Mr. Benton, for the defendants.

Mr. Gilpin for the United States.

These lead mines—'the United States lead mines on the Upper Mississippi'—are situated on Fever river, partly within the northern portion of the state of Illinois, and partly in the territory of Wisconsin. They are of course within 'the territory northwest of the river Ohio,' ceded by Virginia to the United States, by the deed of cession, dated 1st March, 1784, (1 Story's Laws of the U. S. 472;) which deed ceded 'the soil as well as the jurisdiction.' In consequence of that cession, the old Congress passed their ordinance of 20th May, 1785, (1 Story's Laws of the U. S. 563,) for the survey and sale of the ceded lands. That ordinance, after directing the land to be surveyed into lots of one mile square, and all 'springs, mines,' &c. to be noted, authorized their exposure to public sale; but it directed that from such sale there 'should be reserved, for the United States, four lots in each township;' and also, 'one-third part of all gold, silver, copper, or lead mines, to be sold or disposed of as Congress should afterwards direct.' The ordinance of 9th July, 1788, which repealed some portions of that of 1785, left these provisions in full force, up to the formation of the Constitution.

The third section of the fourth article of the Constitution provides, that 'Congress shall have power to dispose of, and make all needful rules and regulations respecting the territory or other property, belonging to the United States.' This clause was legislated upon by the act of 18th May, 1796, (1 Story's Laws, 422, 423,) which provided for the survey and sale of a large portion of the northwestern territory. In the second section of that act, the surveyors were directed to note 'all mines, salt-licks, salt-springs, and mill-seats;' and by the third section, every salt-spring, and a mile square around it, and certain central sections of every township were excluded from sale, and 'reserved for the future disposal of the United States.' On the 10th May, 1800, (1 Story's Laws 789,) an act supplementary to this was passed, which expressly provided 'that the lands of the United States, reserved for future disposition, might be let on leases by the surveyor-general, for terms not exceeding seven years.' When Ohio was formed into the first state in the northwestern territory, Congress stipulated, by the acts of 30th April, 1802, and 3d March, 1803, (2 Story's Laws, 870. 890,) that the reserved sections, and certain other sections of land then unsold, should be granted to the inhabitants for the use of schools, and that the legislature should hold them in trust for that exclusive purpose; that the reserved salt-springs should be granted 'for the use of the people of the state,' under such regulations as the legislature should direct: and that the same should never be sold, nor leased for a longer period than ten years.' In the following year, an act was passed providing for 'the disposal of the public lands in the Indiana territory,' embracing therein the whole public domain...