B-125225, DEC. 28, 1955

B-125225: Dec 28, 1955

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TO THE HONORABLE SECRETARY OF THE INTERIOR: REFERENCE IS MADE TO YOUR LETTER OF AUGUST 15. IT IS STATED IN YOUR LETTER THAT GYPSUM IS A MINERAL SUBJECT TO DISPOSAL UNDER THE UNITED STATES MINING LAWS. WHEN THE LAND IS SUBJECT TO LOCATION. IT IS FURTHER STATED. THAT SINCE AT THE TIME THE ABOVE CONTRACT WAS EXECUTED THE LAND WAS COVERED BY AN OIL AND GAS LEASE ISSUED UNDER THE ACT OF FEBRUARY 25. IT WAS NOT SUBJECT TO LOCATION UNDER THE UNITED STATES MINING LAWS. IT APPEARS THAT THE ABOVE CONTRACT WAS ENTERED INTO PURSUANT TO THE MATERIALS ACT OF JULY 31. SUCH ACTION APPEARS TO HAVE BEEN BASED UPON A DEPARTMENTAL RULING TO THE EFFECT THAT GYPSUM COULD BE DISPOSED OF UNDER THAT ACT WHEN LOCATED ON LANDS NOT SUBJECT TO MINING LOCATION BECAUSE EMBRACED IN AN OIL AND GAS LEASE.

B-125225, DEC. 28, 1955

TO THE HONORABLE SECRETARY OF THE INTERIOR:

REFERENCE IS MADE TO YOUR LETTER OF AUGUST 15, 1955, SUBMITTING FOR DECISION CERTAIN QUESTIONS CONCERNING THE EFFECT OF THE ACT OF AUGUST 13, 1954, 68 STAT. 708, 30 U.S.C. 521, ON CONTRACT I-2L/6/039055, ENTERED INTO UNDER DATE OF OCTOBER 21, 1951, WITH H. M. HOLLOWAY, INC.

IT IS STATED IN YOUR LETTER THAT GYPSUM IS A MINERAL SUBJECT TO DISPOSAL UNDER THE UNITED STATES MINING LAWS, 30 U.S.C. 22, AND FOLLOWING SECTIONS, WHEN THE LAND IS SUBJECT TO LOCATION. IT IS FURTHER STATED, HOWEVER, THAT SINCE AT THE TIME THE ABOVE CONTRACT WAS EXECUTED THE LAND WAS COVERED BY AN OIL AND GAS LEASE ISSUED UNDER THE ACT OF FEBRUARY 25, 1920, 41 STAT. 437, 30 U.S.C. 181 ET SEQ., IT WAS NOT SUBJECT TO LOCATION UNDER THE UNITED STATES MINING LAWS. ACCORDINGLY, IT APPEARS THAT THE ABOVE CONTRACT WAS ENTERED INTO PURSUANT TO THE MATERIALS ACT OF JULY 31, 1947, 61 STAT. 681, 43 U.S.C. 1185, AND REGULATIONS PROMULGATED PURSUANT THERETO, 43 C.F.R. 259. SUCH ACTION APPEARS TO HAVE BEEN BASED UPON A DEPARTMENTAL RULING TO THE EFFECT THAT GYPSUM COULD BE DISPOSED OF UNDER THAT ACT WHEN LOCATED ON LANDS NOT SUBJECT TO MINING LOCATION BECAUSE EMBRACED IN AN OIL AND GAS LEASE.

UNDER PARAGRAPH 2 OF THE CONTRACT THE CONTRACTOR IS GRANTED THE EXCLUSIVE RIGHT TO MINE AND REMOVE ALL GYPSUM FROM THE LAND DESCRIBED THEREIN. THE TERM OF THE CONTRACT AS STATED IN PARAGRAPH 3 IS FOR ONE YEAR FROM DATE THEREOF AND SO LONG AS GYPSUM IS PRODUCED IN PAYING QUANTITIES AS DETERMINED BY THE REGIONAL ADMINISTRATOR. PARAGRAPH 4 PROVIDES FOR THE PAYMENT TO THE UNITED STATES OF NOT LESS THAN 25.6 PERCENT OF THE NET SELLING PRICE PER UNIT BUT NOT LESS THAN 25 CENTS PER TON AND IN NO EVENT LESS THAN $5,000 PER YEAR. PARAGRAPH 18 PROVIDES FOR TERMINATION OF THE CONTRACT BY THE GOVERNMENT AT THE REQUEST OF THE CONTRACTOR UPON A SATISFACTORY SHOWING BY IT THAT SUCH TERMINATION WILL NOT ADVERSELY AFFECT THE PUBLIC INTEREST AND THAT ALL CHARGES DUE THE GOVERNMENT HAVE BEEN PAID.

AS INDICATED IN YOUR LETTER THE ACT OF AUGUST 13, 1954, 68 STAT. 708, 30 U.S.C. 521, AUTHORIZES THE LOCATION OF MINING CLAIMS UNDER THE UNITED STATES MINING LAWS UPON LANDS EMBRACED IN OIL AND GAS LEASES. IT APPEARS THAT ON DECEMBER 22, 1954, THE CONTRACTOR INFORMED YOUR ADMINISTRATIVE ASSISTANT THAT UNDER AUTHORITY OF THE ACT OF AUGUST 13, 1954, IT HAD MADE MINING LOCATIONS ON THE LAND COVERED BY ITS CONTRACT. AT THE SAME TIME THE CONTRACTOR REQUESTED THAT IT BE INFORMED WHETHER IN VIEW OF THE PROVISIONS OF THE ACT IT IS STILL BOUND BY THE TERMS OF ITS CONTRACT OR IF IT NOW MAY PROCEED TO MINE GYPSUM UNDER AUTHORITY OF ITS MINING LOCATIONS.

IN VIEW OF THE ABOVE CIRCUMSTANCES YOU SUBMIT FOR OUR ANSWER THE FOLLOWING QUESTIONS:

"/1) WHETHER THE ACT OF AUGUST 31, 1954, OPERATED TO NULLIFY THE CONTRACT BY REMOVING THE MINERALS FROM THE OPERATION OF THE MATERIALS ACT?

"/2) WHETHER OR NOT IN VIEW OF THE TERMS OF THE CONTRACT H. M. HOLLOWAY, INC., MAY SURRENDER THE CONTRACT IN VIEW OF THE ENACTMENT OF THE ACT OF AUGUST 13, 1954?

"/3) IF THE FIRST QUESTION IS ANSWERED IN THE AFFIRMATIVE WOULD THE CONTRACT TERMINATE BY OPERATION OF LAW ON THE DATE OF THE AUGUST 13, 1954 ACT?

"/4) DID CONGRESS BY ENACTING THE ACT OF AUGUST 13, 1954, AUTHORIZE THIS DEPARTMENT TO TERMINATE THE CONTRACT, EITHER ON ITS OWN MOTION OR ON MUTUAL CONSENT OF THE PARTIES?

THE ACT OF AUGUST 13, 1954, AMENDS THE MINERAL LEASING AND MINING LAWS TO PERMIT MULTIPLE DEVELOPMENT OF THE SAME TRACTS. THE ACT IS INTENDED TO RESOLVE THE CONFLICTS BETWEEN THE MINING LAWS AND THE MINERAL LEASING ACT WHICH HAVE PREVENTED MINERAL DEVELOPMENT OF THE SAME TRACT FROM GOING FORWARD UNDER BOTH SYSTEMS. SECTIONS 4, 5 AND 6 DEAL WITH THE BASIC PROBLEMS OF CONFLICT BETWEEN RIGHTS ASSERTED UNDER THE MINING LAWS AND THOSE ASSERTED UNDER THE MINERAL LEASING ACT. SECTION 5 PROVIDES AS FOLLOWS:

"SUBJECT TO THE CONDITIONS AND PROVISIONS OF THIS ACT, MINING CLAIMS AND MILLSITES MAY HEREAFTER BE LOCATED UNDER THE MINING LAWS OF THE UNITED STATES ON LANDS OF THE UNITED STATES WHICH AT THE TIME OF LOCATION ARE---

(A) INCLUDED IN A PERMIT OR LEASE ISSUED UNDER THE MINERAL LEASING LAWS; OR

(B) COVERED BY AN APPLICATION OR OFFER FOR A PERMIT OR LEASE FILED UNDER THE MINERAL LEASING LAWS; OR

(C) KNOWN TO BE VALUABLE FOR MINERALS SUBJECT TO DISPOSITION UNDER THE MINERAL LEASING LAWS; TO THE SAME EXTENT IN ALL RESPECTS AS IF THE LANDS WERE NOT SO INCLUDED OR COVERED OR KNOWN.'

IT IS A GENERAL PRINCIPLE OF STATUTORY CONSTRUCTION THAT, UPON ENACTMENT, A STATUTE BECOMES A PART OF AND IS TO BE READ IN CONNECTION WITH THE WHOLE BODY OF THE LAW TO WHICH IT RELATES. FURTHERMORE, A SUBSEQUENT STATUTE WILL NOT BE PRESUMED TO HAVE BEEN INTENDED TO ABROGATE A PRIOR STATUTE UNLESS SUCH INTENTION IS MADE CLEAR BY EXPRESS DECLARATIONS OR BY NECESSARY IMPLICATION, AND REPEALS BY IMPLICATION ARE NOT FAVORED IN THE LAW. SEE 50 AM.JUR., STATUS, SEC. 339 ET SEQ.

IN VIEW OF THE PROVISIONS OF THE ACT OF AUGUST 13, 1954, THERE CAN BE NO DOUBT THAT AT THE PRESENT TIME GYPSUM WOULD NOT BE SUBJECT TO DISPOSITION UNDER THE MATERIALS ACT OF 1947. HENCE, IT IS REASONABLE TO STATE THAT INSOFAR AS CONCERNS MINERALS SUBJECT TO THE MINING LAWS, THE 1954 ACT, IN EFFECT, REPEALED THE MATERIALS ACT. BUT THAT BEING SO, IT DOES NOT FOLLOW THAT THE 1954 ACT ABROGATED OR NULLIFIED ANY VESTED RIGHTS--- EITHER THOSE OF THE CONTRACTOR OR THOSE OF THE GOVERNMENT--- OBTAINED BY VIRTUE OF AGREEMENTS ENTERED INTO UNDER THE MATERIALS ACT. THERE IS AMPLE AUTHORITY FOR THE PRINCIPLE THAT A REPEAL OF A STATUTE DOES NOT OPERATE TO EXTINGUISH VESTED RIGHTS WHICH HAVE BEEN ACQUIRED UNDER THE FORMER LAW. 50 AM.JUR., SEC. 526; SUPERIOR OIL CO. V. BEERY, 64 SO.2D 357. ALSO, THE LEGISLATIVE HISTORY OF THE 1954 ACT INDICATES THAT THE CONGRESS DID NOT INTEND TO DEPRIVE INDIVIDUALS OF VESTED RIGHTS OBTAINED UNDER PRIOR STATUTES.

ACCORDINGLY, ASSUMING THE VALIDITY OF THE INVOLVED CONTRACT AT THE TIME OF ITS EXECUTION, YOUR FIRST QUESTION MUST BE ANSWERED IN THE NEGATIVE.

YOUR SECOND QUESTION ALSO MUST BE ANSWERED IN THE NEGATIVE. IN THE CIRCUMSTANCES, IT SEEMS CLEAR THAT THE ONLY BASIS FOR TERMINATION OF THE CONTRACT WOULD BE PURSUANT TO THE EXPRESS PROVISIONS OF PARAGRAPH 18; THAT IS, UPON A SATISFACTORY SHOWING BY THE CONTRACTOR THAT SUCH TERMINATION WILL NOT ADVERSELY AFFECT THE PUBLIC INTEREST.

IN VIEW OF THE ANSWER TO THE FIRST QUESTION NO ANSWER TO THE THIRD QUESTION IS REQUIRED.

FOR REASONS INDICATED ABOVE, YOUR FOURTH QUESTION IS ANSWERED IN THE NEGATIVE.