Watt v. Western Nuclear, Inc.
462 U.S. 36 (1983)

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U.S. Supreme Court

Watt v. Western Nuclear, Inc., 462 U.S. 36 (1983)

Watt v. Western Nuclear, Inc.

No. 81-1686

Argued January 17, 1983

Decided June 6, 1983

462 U.S. 36

CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR

THE TENTH CIRCUIT

Syllabus

The Stock-Raising Homestead Act of 1916 (SRHA) provided for the settlement of homesteads on lands the surface of which was "chiefly valuable for grazing and raising forage crops." Section 9 of the SRHA reserved to the United States title to "all the coal and minerals" in lands patented under the Act. When respondent mining company acquired a fee interest in land covered by a patent under the Act, it proceeded to remove gravel from a pit located on the land to use in paving streets and sidewalks in a company town where its workers lived. The Bureau of Land Management then notified respondent, and later determined, after a hearing, that the removal of the gravel constituted a trespass in violation of a Department of the Interior regulation for which respondent was liable in damages to the United States. The Interior Board of Land Appeals affirmed, holding that gravel is a mineral reserved to the United States in patents issued under the SRHA. Respondent then filed suit in Federal District Court, which affirmed, but the Court of Appeals reversed.

Held: Gravel found on lands patented under the SRHA is a mineral reserved to the United States within the meaning of § 9 of the Act. Pp. 462 U. S. 42-60.

(a) For a substance to be a mineral reserved under the SRHA, it must not only be a mineral within a familiar definition of that term, as is gravel, but must also be the type of mineral that Congress intended to reserve to the United States in lands patented under the Act. Pp. 462 U. S. 42-46.

(b) Congress' purpose in the SRHA of facilitating the concurrent development of both surface and subsurface resources supports construing the mineral reservation to encompass gravel. While Congress expected that homesteaders would use the surface of SRHA lands for stockraising and raising crops, it sought to ensure that valuable subsurface resources would remain subject to disposition by the United States, under the general mining laws or otherwise, to persons interested in exploiting them. Given Congress' understanding that the surface of SRHA lands would be used for ranching and farming, the mineral reservation in the Act is properly interpreted to include substances, such as gravel, that are mineral in character, can be removed from the soil, and can be used for

Page 462 U. S. 37

commercial purposes, and that there is no reason to suppose were intended to be included in the surface estate. Pp. 462 U. S. 46-56.

(c) The conclusion that gravel is a mineral for purposes of the SRHA is also supported by the treatment of gravel under other federal statutes concerning minerals, and by federal administrative and judicial decisions over the last 50 years that have consistently recognized that gravel deposits could be located under the general mining laws. Pp. 462 U. S. 56-59.

(d) Finally, this conclusion is further buttressed by the rule that land grants are construed favorably to the Government. This rule applies here with particular force, because the legislative history of the SRHA reveals Congress' understanding that the mineral reservation would limit the operation of the Act strictly to the surface of the lands. Pp. 462 U. S. 59-60.

664 F.2d 234, reversed.

MARSHALL, J., delivered the opinion of the Court, in which BURGER, C.J., and BRENNAN, WHITE, and BLACKMUN, JJ., joined. POWELL, J., filed a dissenting opinion, in which REHNQUIST, STEVENS, and O'CONNOR, JJ., joined, post, p. 462 U. S. 60. STEVENS, J., filed a dissenting opinion, post, p. 462 U. S. 72.

JUSTICE MARSHALL delivered the opinion of the Court.

The Stock-Raising Homestead Act of 1916, the last of the great Homestead Acts, provided for the settlement of homesteads on lands the surface of which was "chiefly valuable for grazing and raising forage crops" and "not susceptible of irrigation from any known source of water supply." 43 U.S.C. § 292. Congress reserved to the United States title to "all the coal and other minerals" in lands patented under the Act. 43 U.S.C. § 299. The question presented by this case is

Page 462 U. S. 38

whether gravel found on lands patented under the Act is a mineral reserved to the United States.

I

A

The Stock-Raising Homestead Act of 1916 (SRHA), 39 Stat. 862, 43 U.S.C. § 291 et seq., permitted any person qualified to acquire land under the general homestead laws, Act of May 20, 1862, 12 Stat. 392, as amended, 43 U.S.C. § 161 et seq., to make "a stock-raising homestead entry" on "unappropriated, unreserved public lands . . . designated by the Secretary of the Interior as stock-raising lands.'" [Footnote 1] 43 U.S.C. § 291. The Secretary of the Interior was authorized to designate as stockraising lands only

"lands the surface of which is, in his opinion, chiefly valuable for grazing and raising forage crops, do not contain merchantable timber, are not susceptible of irrigation from any known source of water supply, and are of such character that six hundred and forty acres are reasonably required for the support of a family."

43 U.S.C. § 292 To obtain a patent, an entryman was required to reside on the land for three years, 43 U.S.C. § 293, incorporating by reference 37 Stat. 123, ch. 153, 43 U.S.C. § 164, and

"to make permanent improvements upon the land . . . tending to increase the value of the [land] for stock-raising purposes of the value of not less than $1.25 per acre."

43 U.S.C. § 293.

Section 9 of the Act, the provision at issue in this case, stated that

"[a]ll entries made and patents issued . . . shall be

Page 462 U. S. 39

subject to and contain a reservation to the United States of all the coal and other minerals in the lands so entered and patented, together with the right to prospect for, mine, and remove the same."

39 Stat. 864, as amended, 43 U.S.C. § 299. Section 9 further provided that

"[t]he coal and other mineral deposits in such lands shall be subject to disposal by the United States in accordance with the provisions of the coal and mineral land laws in force at the time of such disposal."

B

On February 4, 1926, the United States conveyed a tract of land near Jeffrey City, Wyo., to respondent's predecessor in interest. The land was conveyed by Patent No. 974013 issued pursuant to the SRHA. As required by § 9 of the Act, 43 U.S.C. § 299, the patent reserved to the United States "all the coal and other minerals" in the land.

In March, 1975, respondent Western Nuclear, Inc., acquired a fee interest in a portion of the land covered by the 1926 patent. Western Nuclear is a mining company that has been involved in the mining and milling of uranium ore in and around Jeffrey City since the early 1950's. In its commercial operations, Western Nuclear uses gravel for such purposes as paving and surfacing roads and shoring the shaft of its uranium mine. In view of the expense of having gravel hauled in from other towns, the company decided that it would be economical to obtain a local source of the material, and it acquired the land in question so that it could extract gravel from an open pit on the premises.

After acquiring the land, respondent obtained from the Wyoming Department of Environmental Quality, a state agency, a permit authorizing it to extract gravel from the pit located on the land. Respondent proceeded to remove some 43,000 cubic yards of gravel. It used most of this gravel for paving streets and pouring sidewalks in nearby Jeffrey City, a company town where respondent's mill and mine workers lived.

Page 462 U. S. 40

On November 3, 1975, the Wyoming State Office of the Bureau of Land Management (BLM) served Western Nuclear with a notice that the extraction and removal of the gravel constituted a trespass against the United States in violation of 43 CFR § 9239.0-7 (1975), current version at 43 CFR § 9239.0-7 (1982), a regulation promulgated by the Department of the Interior under the Materials Act of 1947, 61 Stat. 681, as amended by the Surface Resources Act of 1955, 69 Stat. 367, 30 U.S.C. §§ 601-615. The regulation provides that

"[t]he extraction, severance, injury, or removal of timber or mineral materials from public lands under the jurisdiction of the Department of the Interior, except when authorized by law and the regulations of the Department, is an act of trespass."

The BLM's appraisal report described the gravel deposit as follows:

"The deposit located on the property is an alluvial gravel with 6.4 acres of the 14-acre parcel mined for gravel. . . . There are 6-12 inches of overburden on the site. . . . It is estimated that the deposit thickness will average 10 feet or more in thickness."

85 I.D. 129, 131 (1978). In a technical analysis accompanying the appraisal report, geologist William D. Holsheimer observed that "[t]he gravel is overlain by a soil cover of fairly well developed loamy sand, some 12-18 inches in thickness," and that "[t]here is a relatively good vegetative cover, consisting mainly of sagebrush, and an understory of various native grasses." Id. at 132. The appraisal report concluded that "the highest and best use of the property is for a mineral material (gravel) site." Id. at 131.

After a hearing, the BLM determined that Western Nuclear had committed an unintentional trespass. Using a royalty rate of 30

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