Western Nuclear, Inc. v. Andrus

• Decision Date: 27 August 1979
• Docket Number: No. C78-129K.,C78-129K.
• Citation: 475 F. Supp. 654
• Parties: WESTERN NUCLEAR, INC., a Delaware Corporation, authorized and doing business in the State of Wyoming, Plaintiff, v. Cecil ANDRUS, Secretary of the United States Department of the Interior, and the United States of America, Defendants, and Wyoming Stock Growers Association, John Orr and the Associated General Contractors of Wyoming, Intervenors.
• Court: U.S. District Court — District of Wyoming

475 F. Supp. 654

WESTERN NUCLEAR, INC., a Delaware Corporation, authorized and doing business in the State of Wyoming, Plaintiff, v. Cecil ANDRUS, Secretary of the United States Department of the Interior, and the United States of America, Defendants and Wyoming Stock Growers Association, John Orr and the Associated General Contractors of Wyoming, Intervenors.

No. C78-129K.

United States District Court, D. Wyoming.

August 27, 1979.

Paul J. Hickey, of Horiskey, Bagley & Hickey, Cheyenne, Wyo., Harley W. Shaver and John H. Licht, of Canges & Shaver, Denver, Colo., and Terrence A. Kippen, of Western Nuclear, Inc., Denver, Colo., for plaintiff Western Nuclear, Inc.

Charles E. Graves, U. S. Atty., for the District of Wyoming, Sharon A. Lyman, Asst. U. S. Atty., for the District of Wyoming, Cheyenne, Wyo., and Lyle K. Rising, Dept. of Interior, Denver, Colo., for defendants.

Glenn Parker, of Hirst & Applegate, Cheyenne, Wyo., for intervenor Wyoming Stock Growers Association.

Marilyn S. Kite, Laramie, Wyo., for intervenors John Orr and the Associated General Contractors of Wyoming.

MEMORANDUM OPINION

KERR, District Judge.

This case presents the question of whether gravel is a mineral. It is a dispute between Western Nuclear, a mining company, and the Interior Department (BLM) over the ownership of certain gravel deposits. The facts are not in dispute.

Western Nuclear has been located in Jeffrey City, Wyoming since the early 50's when uranium was first discovered on Green Mountain. Exploration in the area has been going on for more than 10 years. After Western Nuclear had done initial exploration and location of the ore bodies, it began sinking a shaft in September 1975.

To keep the sides of the shaft from caving in, the company has been using concrete to shore the shaft. To date, the shaft is about 1500 feet deep. Western Nuclear's contractor hauled gravel from Lander and Casper to use in the concrete that was mixed in Jeffrey City.

This method of concrete production was very expensive so Western Nuclear began looking for a local source of material. In March 1975 they had bought a piece of property (the subject land) from Johnson-Redland which had an old gravel pit located thereon.

The original conveyance of the subject land was by patent (# 914013) in 1926 pursuant to the Stock-Raising Homestead Act (1916). The patent contained the following reservation:

Excepting and reserving however, to the United States all the coal and other minerals in the land so entered and patented together with the right to prospect for, mine, and remove the same pursuant to the provisions and limitations of the Act of December 29, 1916 . . . 39 STAT 862.

Western Nuclear has taken some 43,000 cubic yards of gravel from the site. The majority of it was used for blacktopping streets and pouring sidewalks in Jeffrey City.

Prior to removing the gravel, Western Nuclear made application to the Wyoming Department of Environmental Quality (DEQ) to obtain a permit for the development of a gravel pit.

The Wyoming DEQ informed the BLM of the pending application and granted the permit. When the permit was granted, Western Nuclear dug certain quantities of gravel from that pit. On November 3, 1975 Western Nuclear was served with a Notice of Trespass. The notice alleged a violation of the Materials Act of 1947 and the Common Varieties Act of 1955.

The finding of involuntary trespass by the Wyoming office of the BLM was appealed to the Interior Board of Land Appeals (IBLA). The decision of the Wyoming BLM was upheld in a May 22, 1978 decision, 35 IBLA 146.

Western Nuclear was assessed damages of approximately $13,000 for the gravel taken.

Plaintiff argues on review that (1) BLM and the Interior Department lack jurisdiction over the land in question. From a study of the cases, this argument lacks merit. (2) The mineral reservation did not include ordinary gravel. (3) The amount assessed as damages is inappropriate and not in conformance with Wyoming law. The BLM did not take into account the cost of recovering the gravel.

Issue: Does the Stock-Raising Homestead Act's reservation "all the coal and other minerals" include gravel?

Before the mineral reservation is examined more closely, the general rules of statutory construction must be considered: (1) Patent mineral reservations are construed according to the intent of Congress at the time of enactment and under the circumstances then present. Moor v. County of Alameda, 411 U.S. 693, 709, 93 S.Ct. 1785, 36 L.Ed.2d 596 (1973); U. S. v. Stewart, 311 U.S. 60, 69, 61 S.Ct. 102, 85 L.Ed. 40 (1940).

Legislative intent is sought in the history of the legislation as recorded in the legislative record, the committee report, statements by sponsors, floor debates, as well as the condition of the country at the time and the purpose of Congress. Winona & St. Peter R. R. v. Barney, 113 U.S. 618, 625, 5 S.Ct. 606, 28 L.Ed. 1109 (1885); U. S. v. Union Pac. R. R. Co., 230 F.2d 690 (10th Cir. 1956), rev. on other grounds 353 U.S. 112, 77 S.Ct. 685, 1 L.Ed.2d 693 (1957).

(2) Public legislation is construed broadly in favor of the government which made the grant; no rights pass by implication. U. S. v. Union Pac. R.R. Co., 353 U.S. 112, 77 S.Ct. 685 (1957); Andrus v. Charlestone Stone Productions Co., 436 U.S. 604, 617, 98 S.Ct. 2002, 56 L.Ed.2d 570 (1978).

The Stock-Raising Homestead Act (SRHA) of Dec. 29, 1916, 43 U.S.C. §§ 291-301 (1970), was enacted to "restore and promote the livestock and meat-producing capacity of the semi-arid states and . . to furnish homes to landless and homeless citizens of our country." Stock-Raising land was classified as "lands, the surface of which is . . . chiefly valuable for grazing and raising forage crops, do not contain merchantable timber, and not susceptible to irrigation from any known source of water supply, and are of such character that 640 acres are reasonably required for the support of a family." 43 U.S.C. § 292 (1970).

Following entry and compliance with the requirements of the statute, the entryman became entitled to a patent subject to a reservation in the U. S. of the "coal and other minerals". The SRHA provided that the reserved minerals would be disposed of under the coal and mineral land laws in effect at the time of disposal. The SRHA gives any qualified person the right "at all times" tò enter onto patented surfaces to prospect for minerals. Under one statutory alternative, 43 U.S.C. 299, it is not necessary for the prospector to obtain the surface owner's consent, he can post a bond sufficient to cover the damage to permanent improvements. Otherwise, he obtains consent and pays for the actual damage to the permanent improvements. Congress subsequently expanded the Act of 1916 to include damages caused by a prospector's strip or open-pit mining to the value of the land for grazing by Act of June 21, 1949, 30 U.S.C. 54 (1970) and Act of June 17, 1949, 30 U.S.C. 54 (1970). Congress probably intended to encourage prospecting under this Act by omitting the surface owner's consent to such entries. 1 American Law of Mining Sec. 3.50.

Historically, the severance of the surface from the mineral estate can be traced to English Common Law by which the Crown retained the gold and silver from grants of the land. The Continental Congress in America followed suit by reserving a 1/3 interest in all gold, silver, lead and copper mined on the public lands opened to settlement under the Land Ordinance of 1785. This continued in a variety of forms until 1846 when the pre-emption and homestead acts allowed the minerals to pass with patents to the land. The settlement act attempted to exclude known mineral lands from agricultural entry and patent. Because of unscientific methods, classification of mineral land was a failure and vast tracts of mineral lands in the West had passed to private owners by 1900.

Congress would not act to prevent this loss so President Theodore Roosevelt became involved. He withdrew large areas of public land thought to be valuable for coal from all forms of entry. In 1906 and again in 1907, President Roosevelt pointed out that some public lands were useful for both agriculture and production of subsurface fuels, and that these two uses could best be served by separate disposition of the right to utilize the same land for each purpose. The President called the attention of Congress "to the importance of conserving the supplies of mineral fuels still belonging to the Government". 41 Cong.Rec. 2806 (1907). To that end, the President recommended "enactment of such legislation as would provide for title to and development of the surface land as separate and distinct from the right to the underlying mineral fuels in regions where these may occur . . ."

In 1909 the Secretary of the Interior returned to the same theme, arguing that "inducements for much of the crime and fraud . . . can be prevented by separating the right to mine from the title to the soil. The surface would thereby be open to entry under other laws according to its character and subject to the right to extract coal . . ." The Secretary made the same suggestion with respect to "oil and gas fields in the public domain".

The Coal Lands Act of 1909 and 1910 were the first two of the agricultural entry statutes. These were followed by the Agricultural Entry Act of 1914 which allowed agricultural entry onto lands withdrawn as valuable for phosphate, nitrate, potash, oil, gas or asphaltic minerals. In order to provide more acreage to ranchers in the arid Western lands, the Stock-Raising Homestead Act (SRHA) of 1916 was also adopted. It increased the homestead allotment from 320 acres to 640 acres. It eliminated the problem of classifying lands entered under its provisions as agricultural or mineral. The 1916 Act simply provided for a qualified patent which reserved to the U. S. all minerals in lands homesteaded for stockraising purposes.

The effectiveness of these Acts was...