B-123118, JUL. 1, 1955

B-123118, JUL. 1, 1955

TO THE SECRETARY OF THE INTERIOR:

REFERENCE IS MADE TO YOUR LETTER OF MARCH 2, 1955, PRESENTING FOR DECISION CERTAIN QUESTIONS CONCERNING THE REPAYMENT OF OIL AND GAS LEASE RENTALS ON LANDS LEASED UNDER THE MINERAL LEASING ACT OF 1920 (41 STAT. 437, AS AMENDED, 30 U.S.C. 181 AND FOLLOWING SECTIONS), WHICH LANDS SUBSEQUENTLY WERE INCLUDED IN MINERAL PATENT APPLICATIONS FOR WHICH FINAL CERTIFICATES OR PATENTS HAVE ISSUED UNDER THE UNITED STATES MINING LAWS, 30 U.S.C. 21 AND FOLLOWING SECTIONS.

IT IS STATED IN YOUR LETTER THAT ON JULY 14, 1950, A NON-COMPETITIVE OIL AND GAS LEASE APPLICATION (COLORADO 01399) WAS FILED UNDER THE MINERAL LEASING ACT AND A LEASE WAS GRANTED EFFECTIVE APRIL 1, 1951. RENTALS FOR THE FIRST LEASE YEAR FOR THE AREAS CONFLICTING WITH CERTAIN MINING CLAIMS AGGREGATED $642.50. UNDER 43 C.F.R. 192.80 NO RENTALS ACCRUED FOR THE SECOND AND THIRD LEASE YEARS, BUT THE RENTAL FOR THE FOURTH YEAR TOTALED $321.25 FOR SUCH AREAS. ON AUGUST 3, 1953, THE WEBER OIL COMPANY FILED MINERAL PATENT APPLICATION COLORADO 07026 FOR CERTAIN OIL SHALE PLACER MINING CLAIMS WHICH WERE LOCATED PRIOR TO ENACTMENT OF THE MINERAL LEASING ACT AND A FINAL CERTIFICATE FOR THE MINING CLAIMS WAS ISSUED ON APRIL 19, 1954.

AT THE TIME THE OIL AND GAS LEASE WAS ISSUED BY THE MANAGER OF THE LOCAL LAND OFFICE, THE EXISTENCE OF THE PRIOR OIL SHALE PLACER MINING CLAIMS WAS NOT INDICATED ON THE LAND OFFICE RECORDS. UNDER NORMAL CIRCUMSTANCES THIS INFORMATION WOULD NOT BE INCLUDED IN SUCH RECORDS OR OTHERWISE KNOWN TO THE LAND OFFICE PERSONNEL BECAUSE, UNDER THE UNITED STATES MINING LAWS, THERE IS NO REQUIREMENT THAT THE LOCATIONS OF MINING CLAIMS ON THE PUBLIC DOMAIN BE RECORDED IN THE LAND OFFICE. HOWEVER, UNDER STATE LAWS SUCH MINING CLAIMS ARE REQUIRED TO BE RECORDED IN THE OFFICE OF THE COUNTY RECORDER, THUS PLACING APPLICANTS FOR THE OIL AND GAS LEASES ON CONSTRUCTIVE NOTICE OF PRIOR MINING CLAIMS. THE QUESTION OF THE LESSEE'S RIGHTS UNDER THE INSTANT LEASE AND HIS RIGHT TO REFUND OF THE RENTALS PAID DID NOT ARISE UNTIL THE LESSEE WAS INFORMED OF THE PENDING PATENT APPLICATION, AT WHICH TIME HE FILED AN APPLICATION FOR REFUND.

THE QUESTIONS PRESENTED FOR DECISION ARE SUMMARIZED IN YOUR LETTER AS FOLLOWS:

"/1) ASSUMING THE VALIDITY OF THE CONFLICTING MINING CLAIMS, MAY THE APPLICATION FOR REPAYMENT BE ALLOWED UNDER THE ACT OF MARCH 26, 1906 (35 STAT. 48; 43 U.S.C. SECS. 95 TO 98A), AS AMENDED AND SUPPLEMENTED, OR UNDER ANY OTHER LAW?

"/2) IF THE ANSWER TO QUESTION (1) IS IN THE AFFIRMATIVE, WOULD ELIGIBILITY FOR REPAYMENT BE AFFECTED BY THE FACT THAT:

"/A) THE LEASE HAD NOT BEEN CANCELLED, BUT RATHER WAS ALLOWED TO EXPIRE AFTER THE FILING OF AN APPLICATION FOR REPAYMENT;

"/B) THE LEASE HAD EXPIRED PRIOR TO THE FILING OF THE APPLICATION FOR REPAYMENT?

"/3) ASSUMING THAT REPAYMENT CAN BE MADE, SHOULD THE TOTAL AMOUNT OF THE RENTAL PAID IN UNDER THE LEASE BE REFUNDED OR WOULD REPAYMENT BE LIMITED TO THE AMOUNTS PAID AFTER DETERMINATION OF THE VALIDITY OF THE MINING CLAIM OR ISSUANCE OF MINERAL PATENT?

THE MINING LAWS REFERRED TO ABOVE PROVIDE FOR THE LOCATION OF MINING CLAIMS ON PUBLIC LANDS CONTAINING VALUABLE MINERAL RIGHTS. THE LOCATOR OF A VALID MINING CLAIM WHO COMPLIES WITH APPLICABLE FEDERAL, STATE AND LOCAL LAWS, INCLUDING THE FILING OF LOCATION NOTICES FOR RECORD WHERE REQUIRED BY LOCAL LAW--- 43 C.F.R. 185.14 AND 185.15--- HAS EXCLUSIVE RIGHT OF POSSESSION OF HIS CLAIM. 30 U.S.C. 26. TO COMPLY WITH STATE LAWS THE LOCATOR IS GENERALLY REQUIRED TO RECORD HIS CLAIM IN THE RECORDER'S OFFICE OF THE COUNTY IN WHICH THE CLAIM IS LOCATED. THIS IS THE ONLY RECORD NOTICE OF THE EXISTENCE OF THE CLAIM (OTHER THAN THE LOCATION NOTICES AND REQUIRED ANNUAL IMPROVEMENTS ON THE LAND REQUIRED BY THE REGULATIONS, 43 C.F.R. 185.14 AND 185.16) WHICH IS AVAILABLE TO ANY INTEREST ADVERSE TO THE LOCATOR. THIS POSSESSORY INTEREST MAY BE HELD INDEFINITELY SO LONG AS THE LOCATOR EXPENDS ANNUALLY FOR LABOR AND IMPROVEMENTS THE AMOUNTS PROVIDED BY THE REGULATIONS. THE LOCATOR IS NOT REQUIRED TO RECORD HIS CLAIM IN A FEDERAL DISTRICT LAND OFFICE. NEITHER THE BUREAU OF LAND MANAGEMENT, THE CUSTODIAN OF THE LAND, NOR ANY OTHER FEDERAL AGENCY HAS ANY OFFICIAL KNOWLEDGE OF THE CLAIM UNLESS THE LOCATOR APPLIES FOR A PATENT.

AFTER JUNE 20, 1920, DEPOSITS OF COAL, PHOSPHATE SODIUM, POTASSIUM, OIL, OIL SHALE, OR GAS BECAME SUBJECT TO DISPOSITION UNDER THE ABOVE MINERAL LEASING ACT, AS PROVIDED IN THE APPLICABLE REGULATION, 43 C.F.R. 192.1 AND FOLLOWING SECTIONS. THE ACT DOES NOT GUARANTEE, IN ANY WAY, QUIET ENJOYMENT OF LEASED PREMISES UNDER THE LEASES ISSUED PURSUANT THERETO BUT THE LEASE FORMS USED PURPORT TO GRANT THE LESSEES "THE EXCLUSIVE RIGHT AND PRIVILEGE TO DRILL FOR, MINE, EXTRACT, REMOVE, AND DISPOSE OF ALL THE OIL AND GAS DEPOSITS.' THE LESSEE'S RIGHTS, HOWEVER, ARE NEVERTHELESS SUBJECT TO THE PARAMOUNT RIGHTS OF A PRIOR MINERAL CLAIM, MAINTAINED AS REQUIRED BY THE REGULATIONS.

WITH RESPECT TO THE QUESTIONS RAISED IN YOUR LETTER CONCERNING THE APPLICATION OF 43 U.S.C. 95 TO 98A TO SUCH REPAYMENT, SECTION 96 PROVIDES IN MATERIAL PART THAT "IN ALL CASES WHERE IT SHALL APPEAR TO SATISFACTION OF THE SECRETARY OF THE INTERIOR THAT ANY PERSON HAS MADE ANY PAYMENTS TO THE UNITED STATES UNDER THE PUBLIC LAND LAWS IN EXCESS OF THE AMOUNT HE WAS LAWFULLY REQUIRED TO PAY UNDER SUCH LAWS, SUCH EXCESS SHALL BE REPAID TO SUCH PERSON OR TO HIS LEGAL REPRESENTATIVES.' SECTION 98 (A) OF TITLE 43, OF THE CODE, EXTENDS THE ABOVE PROVISION TO "ANY STATUTE RELATING TO THE SALE, ENTRY, LEASE, OR OTHER DISPOSITION OF THE PUBLIC LANDS.' WHILE THESE STATUTORY PROVISIONS VEST YOU WITH AUTHORITY TO MAKE A DETERMINATION THAT PAYMENTS HAVE BEEN MADE IN EXCESS OF THE AMOUNTS REQUIRED UNDER THE PUBLIC LAND LAWS, SUCH A DETERMINATION NECESSARILY MUST BE SUPPORTED BY THE APPLICABLE LAW, REGULATIONS AND FACTS IN EACH PARTICULAR CASE. IN THE PRESENT CASE IT MAY BE PRESUMED THAT THE MINERAL CLAIM WAS PROPERLY EVIDENCED BY POSTING LOCATION NOTICES AND PERFORMANCE OF MAINTENANCE WORK EACH YEAR AS REQUIRED BY THE REGULATIONS. ALSO, IT IS ASSUMED THAT THE CLAIM WAS PROPERLY RECORDED AS REQUIRED BY LOCAL LAWS. IF SUCH BE THE FACTS, THE LESSEE ENTERED INTO THE LEASE WITH ACTUAL OR CONSTRUCTIVE NOTICE OF THE EXISTING MINERAL CLAIM. MOREOVER, IF THE LESSEE HAD COMPLIED WITH THE REGULATIONS CONTAINED IN 43 C.F.R. 192.72 AND ASCERTAINED WHETHER THERE WERE SETTLERS ON THE LAND, IT APPEARS LIKELY THAT HE WOULD HAVE OBTAINED ACTUAL KNOWLEDGE OF THE MINERAL CLAIM. THUS, IN THE ABSENCE OF ANY INTERFERENCE WITH THE LESSEE'S POSSESSION AND BENEFICIAL USE OF THE LAND, IT WOULD SEEM CLEAR THAT THE LESSEE PROPERLY MAY NOT NOW ASSERT A CLAIM FOR REFUND OF ANY PAYMENTS PROPERLY PAYABLE UNDER THE LEASE, PARTICULARLY SINCE THE LESSEE WAS NOT DEPRIVED OF ANY RIGHTS UNDER THE LEASE PRIOR TO THE ISSUANCE OF THE PATENT TO THE MINERAL CLAIMANT.

IN THE LIGHT OF THE FOREGOING, QUESTION 1 IS ANSWERED IN THE NEGATIVE, EXCEPT AS HEREINAFTER NOTED, THUS RENDERING AN ANSWER TO QUESTION 2 UNNECESSARY.

WITH RESPECT TO QUESTION 3, ANY PAYMENT UNDER THE LEASE AFTER DETERMINATION OF THE VALIDITY OF THE MINING CLAIM AND ISSUANCE OF THE MINERAL PATENT WOULD APPEAR TO BE IN EXCESS OF THE PAYMENTS REQUIRED BY LAW AND TO BE REFUNDABLE.