Verrue v. United States, 71-1423.
| Decision Date | 06 April 1972 |
| Docket Number | No. 71-1423.,71-1423. |
| Parties | Alfred N. VERRUE, Appellee, v. UNITED STATES of America et al., Appellants. |
| Court | U.S. Court of Appeals — Ninth Circuit |
Carl Strass (argued), George R. Hyde, Dept. of Justice, Shiro Kashiwa, Asst. Atty. Gen., Edmund B. Clark, Chief, Appellate Section, Washington, D. C., Richard K. Burke, U. S. Atty., Richard S. Allemann, Asst. U. S. Atty., Phoenix, Ariz., for appellants.
Albert H. Mackenzie (argued), of Mackenzie, Bolze & Hirsch, Phoenix, Ariz., for appellee.
Before ELY and HUFSTEDLER, Circuit Judges, and TAYLOR*, District Judge.
This is an appeal by appellants from an order of the District Court reversing a decision of the Secretary of Interior declaring a placer mining claim, the Sandy No. 2, of appellee null and void for lack of discovery of a valuable mineral deposit.
The record in this case reveals that Alfred N. Verrue (Appellee) located the Sandy No. 2 claim on March 7, 1946. On April 9, 1963, a complaint was filed by the United States Government (Appellant) in which it was charged that no discovery of valuable minerals had been made within the boundaries of the claim between March 7, 1946 (date of location) and February 10, 1948 (final withdrawal date). After an evidentiary hearing held on March 24, 1964, a hearing examiner, on November 6, 1964, dismissed the Government's complaint, thereby sustaining the validity of the claim. The decision of the hearing examiner was reversed by the Office of Appeals and Hearings, Bureau of Land Management, which decision was upheld by the Secretary. Upon a review of the final decision of the Secretary of the Interior, the District Court reversed, finding that the Secretary's decision was not supported by substantial evidence. This court has jurisdiction to review this matter pursuant to 5 U.S.C.A. § 704 (formerly 5 U.S.C. 1009(c)).
The narrow issue presented is whether there is substantial evidence in the record as a whole to support the Secretary's decision. The parties agree that the determinative question presented to the hearing examiner, the Secretary and the District Court was whether the sand and gravel on appellee's claim was "marketable" in the 1946-48 period.
The criteria of marketability for sand and gravel claims was clearly announced in Foster v. Seaton, 106 U.S.App.D.C. 253, 271 F.2d 836, 838 (1959) wherein the court stated:
". . . `a mineral locator or applicant, to justify his possession, must show that by reason of accessibility, bona fides in development, proximity to market, existence of present demand, and other factors, the deposit is of such value that it can be mined, removed and disposed of at a profit\'."
The most recent and authoritative enunciation of this rule is found in United States v. Coleman, 390 U.S. 599, 88 S.Ct. 1327, 20 L.Ed.2d 170 (1968) and in Barrows v. Hickel, 447 F.2d 80 (9th Cir. 1971). In Barrows, the court analyzed the development of the marketability and prudent-man tests and determined at p. 82, in regard to the "prudent-man test", that:
"Actual successful exploitation of a mining claim is not required to satisfy the `prudent-man test\'." citing Coleman, supra
and at p. 83, in regard to the "marketability test" that:
emphasis added.
In applying the criteria of marketability as set forth in Foster, supra, the Secretary found that in the 1946-48 period the Sandy No. 2 claim contained a useful and accessible deposit of sand and gravel of the same quality as was being removed and marketed in the general vicinity of the claim. See: United States v. Verrue, 75 I.D. 300, 307 (1968). After reviewing the evidence presented, the Secretary concluded that the failure of the appellee to sell any sand and gravel from his claim in the 1946-48 period demonstrated the lack of marketability at a profit of sand and gravel from the Sandy No. 2 claim by a preponderance of the evidence.
In determining whether the Secretary's decision was based on substantial evidence, this court finds the following language from Foster, supra, at 271 F. 2d 836, 838 persuasive:
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