The United States instituted an action on a bond given by the
defendants, conditioned that certain of the obligors who had taken
from the agent of the United States, under the authority of the
President of the United States, a license for smelting lead ore,
bearing date September 1, 1834, should fully execute and comply
with the terms and conditions of a license for purchasing and
smelting lead ore at the United States' lead mines on the Upper
Mississippi River in the State of Illinois for the period of one
year. The defendants demurred to the declaration, and the question
was presented to the circuit court of Illinois whether the
President of the United States had power, under the Act of Congress
of 3 March, 1807, to make a contract for purchasing and smelting
lead ore at the lead mines of the United States on the Upper
Mississippi. This question was certified from the circuit to the
Supreme Court of the United States.
Held that the
President of the United States has power, under the Act of Congress
of 3 March, 1807, to make the contract on which this suit was
instituted.
The power over the public lands is vested in Congress by the
Constitution without limitation, and has been considered the
foundation on which the territorial governments rest.
The cases of,
McCulloch v. State of
Maryland, 4 Wheat. 422, and
American Insurance Company
v. Canter, 1 Pet. 542, cited.
The words "dispose of" the public lands, used in the
Constitution of the United States, cannot, under the decisions of
the Supreme Court, receive any other construction than that
Congress has the power, in its discretion, to authorize the leasing
of the lead mines on the public lands in the territories of the
United States. There can be no apprehensions of any encroachments
upon state rights by the creation of a numerous tenantry within the
borders of the states from the adoption of such measures.
The authority given to the President of the United States to
lease the lead mines is limited to a term not exceeding five years.
This limitation, however, is not to be construed as a prohibition
to renew the leases from time to time if he thinks proper so to do.
The authority is limited to a short period, so as not to interfere
with the power of Congress to make other dispositions of the mines
should they think the same necessary.
The legal understanding of a lease for years, is a contract for
the possession and profits of land for a determinate period, with
the recompense of rent. It is not necessary that the rent should be
in money. If reserved in kind, it is rent in contemplation of
law.
The law of 1807, authorizing the leasing of the lead mines, was
passed before Illinois was organized as a state. She cannot now
complain of any disposition or regulation of the lead mines
previously made by Congress. She surely cannot claim a right to the
public lands within her limits.
On the first day of September, 1834, the defendants entered into
the following bond to the United States, having executed the same
under their respective hands and seals:
"Know all men by these presents, that we, J. P. B. Gratiot,
Robert Burton, D. B. Moorehouse and Charles S. Hempstead, are
holden, and stand firmly bound unto the United States of America or
their certain attorney in the penal sum of ten thousand dollars,
current money of the United States, well and truly to be paid unto
their Treasury, for which payment, well and truly to be made, we,
the said J. P. B. Gratiot, Robert Burton, D. B. Moorehouse, and
Charles
Page 39 U. S. 527
S. Hempstead do hereby jointly and severally bind ourselves, our
heirs, executors, and administrators, and each and every of them,
jointly, severally, and firmly, by these presents. Signed with our
hands, and sealed with our seals, this first day of September in
the year of our Lord one thousand eight hundred and
thirty-four."
"The condition of the above obligation is such that whereas the
said J. P. B. Gratiot and Robert Burton have obtained from the
agent of the United States a license, bearing date the first day of
September, 1834, containing stipulations therein more particularly
described, to smelt lead ore. Now if the said J. P. B. Gratiot and
Robert Burton shall faithfully and fully execute and comply with
the terms and conditions set forth in said license, then and in
that case this obligation to be void and of no effect, otherwise to
remain in full force and virtue."
At the same time, a paper called a "License for Smelting," which
was executed by Thomas C. Legate, major of the United States army,
superintendent of the lead mines, J. P. B. Gratiot, and Robert
Burton, under their hands and seals, was delivered to J. P. B.
Gratiot and Robert Burton by Major Legate.
"This indenture, made and entered into this first day of
September, 1834, between Major T. C. Legate, superintending the
United States lead mines, acting under the direction of the
Secretary of War, of the first part, and J. P. B. Gratiot and
Robert Burton, of the second part, witnesseth: "
"That the said party of the second part is hereby permitted, by
and with the approbation of the President of the United States, to
purchase and smelt lead ore at the United States' lead mines, on
the Upper Mississippi for the period of one year from and after the
date hereof upon the following conditions,
viz.: "
"1. All purchases or other acquisitions of ore, ashes, zinc, or
lead to be from persons authorized to work the mines either as
lessees, smelters, or diggers, and from no others, and no ore to be
purchased from the leased premises of any person without his
permission."
"2. To commence smelting as soon as one hundred thousand pounds
of ore are obtained, and to continue it so long as any is on hand;
to weigh a charge of ore for the log furnace, and the lead produced
from it, when required to do it by the said first party or his
assistant."
"3. To keep a book containing an accurate account of all ore,
ashes, or zinc, purchased or otherwise acquired, and of all lead
manufactured, which book shall at all times be open to inspection
of the said first party or his assistant; and to furnish a
transcript or return at the end of every month, agreeably to a form
furnished by the said first party, which book and returns to be
verified on oath if required."
"4. The said second party hereby agrees to pay the first party,
for the use of the United States, six pounds of every hundred
pounds of all the lead smelted by him under this indenture, to
be
Page 39 U. S. 528
paid monthly in clear, pure lead at the wareroom on Fever River
or at such other place near the mines as the said first party shall
direct and free of expense to the United States. And the said
second party is not to sell or remove from the places of smelting,
in any manner whatever, any lead until the rent be paid as
aforesaid. This condition is subject to the revocation of the
government upon giving three months' previous notice, at which time
it will be optional with the licentiate to accept or refuse the new
terms. Upon his refusal to accept, then this license shall cease
and determine."
"5. The second party is allowed to have as much fuel as will
suffice without waste for the purpose of this indenture, and to
cultivate as much land as will suffice to furnish his teams,
&c., with provender."
"6. It is understood and agreed between the aforesaid parties
that the said second party shall not employ in any manner any
smelter, lessee, or miner who has forfeited his license, lease or
permit to mine, nor any other person who is at the mines without
the authority of the said first party, and the said second party
agrees not to employ or harbor the laborers of workmen of another
smelter. Sixty days are allowed after the expiration of this
license to close all business under it, but it is understood that
no purchase or hauling of ore is to take place after the license is
expired. The bond given for the faithful performance of the
contract is to be in full force and virtue until a written
settlement is made."
"It is distinctly understood by the said parties that upon
proof's being afforded to the first party that either of the
foregoing stipulations have been violated or not complied with, he
may declare this indenture null and void and reenter and take
possession of all the premises as if no such agreement
existed."
In the Circuit Court of the United States for the District of
Illinois, the United States instituted an action of debt to
December term, 1836, against the defendants on this bond. The
declaration sets forth the bond and condition and recites the
license or contract therein mentioned, and avers that the lessees
had, by virtue of the lease, smelted twenty-four hundred thousand
pounds of lead, but had failed to execute the conditions stipulated
on their part by altogether refusing to pay to the superintendent,
for the use of the United States, the six pounds for every hundred
pounds so smelted.
The defendants demurred to the declaration after oyer of the
bond and license for smelting, and on the argument of the demurrer
the following question arose upon which the judges of the circuit
court were divided in opinion and directed it to be certified to
this Court: "Whether the President had power, under the Act of 3
March, 1807, 2 Story's Laws, 1065, 1068, to make the contract set
forth in the declaration."
Page 39 U. S. 534
MR. JUSTICE THOMPSON delivered the opinion of the Court.
This is an action of debt founded on a bond given by the
defendants to the United States in the penalty of ten thousand
dollars, bearing date 1 September, 1834, with a
Page 39 U. S. 535
condition thereunder written for the performance of certain
covenants or stipulations contained in an indenture referred to,
and bearing even date with the bond, and called a license for
smelting lead. The declaration sets out the condition of the bond,
with the parts of the indenture referred to upon which breaches are
alleged, and then assigns the breaches.
The defendants crave oyer of the bond, and the instrument or
indenture referred to in the condition, and they are read to him as
follows:
"Know all men by these presents that we, J. P. B. Gratiot,
Robert Burton, D. B. Moorehouse, and Charles S. Hempstead, are
holden and stand firmly bound unto the United States of America or
their certain attorney in the penal sum of ten thousand dollars
current money of the said United States well and truly to be paid
into their Treasury, for which payment well and truly to be made
we, the said J. P. B. Gratiot, Robert Burton, D. B. Moorehouse, and
Charles S. Hempstead, do hereby jointly and severally bind
ourselves, our heirs, executors, and administrators, and each and
every of them, jointly, severally, and firmly, by these presents.
Signed with our hands, and sealed with our seals, this first day of
September, in the year of our Lord one thousand eight hundred and
thirty-four."
"The condition of the above obligation is such that whereas the
said J. P. B. Gratiot and Robert Burton have obtained from the
agent of the United States a license, bearing date the first day of
September, 1834, containing stipulations therein more particularly
described, to smelt lead ore: Now if the said J. P. B. Gratiot and
Robert Burton shall faithfully and fully execute and comply with
the terms and conditions set forth in said license, then, and in
that case, this obligation to be void and of no effect, otherwise
to remain in full force and virtue."
"J. P. B. GRATIOT [SEAL]"
"ROBERT BURTON [SEAL]"
"CHS. S. HEMPSTEAD [SEAL]"
"J. B. MOOREHOUSE [SEAL]"
"Witnesses present:"
"GEO. GOLDTHROP"
"PETER AYDELOTT"
"ABRAHAM BLAYLEN"
"
License for Smelting"
"This indenture made and entered into this first day of
September, 1834, between Major T. C. Legate, superintending the
United States' lead mines, acting under the direction of the
Secretary of War, of the first part, and J. P. B. Gratiot and
Robert Burton, of the second part, witnesseth: "
"That the said party of the second part is hereby permitted, by
and with the approbation of the President of the United States,
to
Page 39 U. S. 536
purchase and smelt lead ore at the United States' lead mines, on
the Upper Mississippi for the period of one year from and after the
date hereof upon the following condition,
viz.: "
"1. All purchases or other acquisitions of ore, ashes, zinc, or
lead, to be from persons authorized to work the mines either as
lessees, smelters, or diggers, and from no others, and no ore to be
purchased from the leased premises of any person without his
permission."
"2. To commence smelting as soon as one hundred thousand pounds
of ore are obtained, and to continue it so long as any is on hand;
to weigh a charge of ore for the log furnace, and the lead produced
from it, when required to do it by the said first party or his
assistant."
"3. To keep a book containing an accurate account of all ore,
ashes, or zinc, purchased or otherwise acquired, and of all lead
manufactured, which book shall at all times be open to inspection
of the said first party or his assistant, and to furnish a
transcript or return at the end of every month agreeably to a form
furnished by the said first party, which book and returns to be
verified on oath if required."
"4. The said second party hereby agrees to pay the first party,
for the use of the United States, six pounds of every hundred
pounds of all the lead smelted by him, under this indenture, to be
paid monthly in clear, pure lead, at the ware room on Fever River
or at such other place near the mines as the said first party shall
direct, and free of expense to the United States. And the said
second party is not to sell or remove from the place of smelting in
any manner whatever any lead until the rent be paid as aforesaid.
This condition is subject to the revocation of the government, upon
giving three months' previous notice, at which time it will be
optional with the licentiate to accept or refuse the new terms.
Upon his refusal to accept, then this license shall cease and
determine."
"5. The second party is allowed to have as much fuel as will
suffice without waste for the purpose of this indenture, and to
cultivate as much land as will suffice to furnish his teams,
&c., with provender."
"6. It is understood and agreed between the aforesaid parties
that the said second party shall not employ in any manner any
smelter, lessee, or miner who has forfeited his license, lease, or
permit to mine, nor any other person who is at the mines without
the authority of the said first party, and the said second party
agrees not to employ or harbor the laborers or workmen of another
smelter. Sixty days are allowed after the expiration of this
license to close all business under it, but it is understood that
no purchase or hauling of ore is to take place after the license is
expired. The bond given for the faithful performance of the
contract is to be in full force and virtue until a written
settlement is made."
"It is distinctly understood by the said parties that upon
proof's being afforded to the first party that either of the
foregoing stipulations has been violated or not complied with, he
may declare this
Page 39 U. S. 537
indenture null and void, and reenter and take possession of all
the premises as if no such agreement existed."
"THO. C. LEGATE [SEAL]"
"
Major U.S. Army, sup. L. Mines"
"J. P. B. GRATIOT [SEAL]"
"ROBERT BURTON [SEAL]"
"Witnesses present:"
"GEO. GOLDTHORP"
"PETER AYDELOTT"
"ABRAHAM BLAYLEN"
Which being read and heard, the defendants interposed a general
demurrer to the declaration. and upon the argument of the demurrer,
the opinions of the judges were opposed upon the following
point.
"Whether the President of the United States had power under the
Act of Congress of 3 March, 1807, to make the contract set forth in
the declaration,"
which point has been duly certified to this Court. The act of
Congress referred to is entitled, "an act making provision for the
disposal of the public lands situate between the United States
military tract, and the Connecticut reserve, and for other
purposes."
This act establishes a land office and makes provisions for the
disposal of the lands of the United States referred to in the title
of the act, and among other things, the fifth section declares as
follows:
"That the several lead mines in the Indiana Territory, together
with as many sections contiguous to each as shall be deemed
necessary by the President of the United States, shall be reserved
for the future disposal of the United States. And any grant which
may hereafter be made for a tract of land containing a lead mine
which had been discovered previous to the purchase of such tract
from the United States shall be considered fraudulent and null, and
the President of the United States shall be and is hereby
authorized to lease any lead mine which has been or may hereafter
be discovered in the Indiana Territory for a term not exceeding
five years."
That the mines now in question lie within the territory referred
to in the act of Congress, and are the property of the United
States is not denied. And the Constitution of the United States
(article four, section three) provides,
"That Congress shall have power to dispose of and make all
needful rules and regulations respecting the territory or other
property, belonging to the United States."
The term "territory," as here used, is merely descriptive of one
kind of property, and is equivalent to the word "lands." And
Congress has the same power over it as over any other property
belonging to the United States, and this power is vested in
Congress without limitation, and has been considered the foundation
upon which the territorial governments rest. In the case of
McCulloch v. State of
Maryland, 4 Wheat. 422, the Chief Justice, in
giving the opinion of the Court, speaking of this article and the
powers of Congress growing out of it, applies it to territorial
Page 39 U. S. 538
governments, and says all admit their constitutionality.
And again, in the case of
American Insurance Company
v. Canter, 1 Pet. 542, in speaking of the cession
of Florida under the treaty with Spain, he says that Florida, until
she shall become a state, continues to be a territory of the United
States government by that clause in the Constitution which empowers
Congress to make all needful rules and regulations respecting the
territory or other property of the United States. If such are the
powers of Congress over the lands belonging to the United States,
the words "dispose of" cannot receive the construction contended
for at the bar -- that they vest in Congress the power only to sell
and not to lease such lands. The disposal must be left to the
discretion of Congress. And there can be no apprehensions of any
encroachments upon state rights by the creation of a numerous
tenantry within their borders, as has been so strenuously urged in
the argument. The law of 1807, authorizing the leasing of the lead
mines, was passed before Illinois was organized as a state, and she
cannot now complain of any disposition or regulation of the lead
mines previously made by Congress. She surely cannot claim a right
to the public lands within her limits.
It has been the policy of the government at all times in
disposing of the public lands to reserve the mines for the use of
the United States. And their real value cannot be ascertained
without causing them to be explored and worked under proper
regulations. The authority given to the President to lease the lead
mines is limited to a term not exceeding five years; this
limitation, however, is not to be construed as a prohibition to
renew the leases from time to time if he shall think proper so to
do. The authority is limited to a short period so as not to
interfere with the power of Congress to make other disposition of
the mines should it think proper so to do. Does, then, the contract
upon which the present action is founded fall within the authority
given to the President to lease the lead mines? Or in other words,
is this contract a lease within the meaning of the law? In
construing this contract, the bond and what is called "the license
for smelting" are to be taken as parts of the same instrument, and
purport to have been made by the defendants, with T. C. Legate,
superintending the United States' lead mines, acting under the
direction of the Secretary of War, who must be presumed to be
acting under the authority of the President, especially as the
permission given by the contract in terms is said to be by and with
the approbation of the President of the United States. This
contract purports to be a license for smelting lead ore, and it is
objected that this is not a lease within the meaning of the act of
Congress. But this objection is not well founded. It is a contract
for one year, and of course within the time limited by the law,
which gives to the President authority to lease for five years. Is
it, then, a lease? The legal understanding of a lease for years is
a contract for the possession and profits of land for a determinate
period, with the recompense of rent. The contract in question is
strictly within this definition. The
Page 39 U. S. 539
business of smelting is a part of the operation of mining,
although it may be a distinct branch from that of digging the ore;
but the law ought not to be so construed as to require the whole
operation to be embraced in the same contract. They are different
operations, requiring different qualifications and distinct
regulations. This contract is for the possession of land. The work
is to be performed at the United States' lead mines, and must of
course be performed within the limits prescribed by law to be
attached to such mines. And there is an express permission to use
as much fuel as is necessary to carry on the smelting business and
to cultivate as much land as will suffice to furnish teams,
&c., with provender, and there is an express reservation of the
rent of six pounds of every hundred pounds of lead smelted, with
special and particular stipulation for securing the same. It is not
necessary that the rent should be in money. If received in kind, it
is rent in contemplation of law.
We are accordingly of opinion that the question certified in
the record, must be answered in the affirmative.
This cause came on to be heard on the transcript of the record
from the Circuit Court of the United States for the District of
Illinois, and on the point and question on which the judges of the
said circuit court were opposed in opinion and which was certified
to this Court for its opinion agreeably to the act of Congress in
such case made and provided and was argued by counsel. On
consideration whereof it is the opinion of this Court that "the
President had power, under the Act of 3 March, 1807, to make the
contract set forth in the declaration." Whereupon, it is ordered
and adjudged by this Court that it be so certified to the said
circuit court accordingly.
