CHAPTER 5 TITLE TO MINING PROPERTIES

• Jurisdiction: United States

Uranium Exploration and Development
(Nov 1976)
CHAPTER 5
TITLE TO MINING PROPERTIES
Keith M. Crouch
Gorsuch, Kirgis, Campbell, Walker & Grover
Denver, Colorado

INTRODUCTION

This paper deals with title to mining properties and what evidence of title must be present before it can be said that the title to a mining property is "good". This discussion and the paper are generally limited to unpatented mining claims located on the public domain. A discussion of the title to the patented mining claim is not included because that title can be examined in the same manner as other fee property.¹ When examining title to fee lands, including patented mining claims, the attorney can usually make a determination of the marketability of the title based solely upon an examination of abstracts of title prepared by a reputable abstract company. A marketable title in the case of fee lands is generally defined as a title which is fairly deducible of record and reasonably free from such doubt as will affect the market value of the estate and which is acceptable to a reasonably prudent person with full knowledge of all the facts and their legal significance.²

However, an examination of abstracts of title does not reflect the actual status of the title to an unpatented mining claim because many of the components of the title will not appear in the county or federal records.³ Consequently, traditional notions of the marketability of a title should not be the standard by which the title to an unpatented mining claim is judged.

The purpose of this discussion is to review with you the requirements of the law which must be met in order to create title to an unpatented mining claim and the procedures which should be followed when an attempt is made to determine whether the title to the claim is acceptable. The discussion is very basic and elementary in its approach and scope, the hope being that this review will either introduce you to or remind you of the fundamental requirements of the mining laws.

The foundation upon which the title to the unpatented mining claim is constructed is the General Mining Law of 1872, also known as the Mineral Location Law of 1872.⁴ This law has remained the fundamental federal law to date and has been codified with relatively few amendments in Chapter 2 of Title 30 of the United States Code.

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Prior to the enactment of the General Mining Law and its predecessors, the public domain was being exploited for mining purposes by individuals without any recognition of their rights by the federal government. The prospectors were actually trespassers vis a vis the United States and the development of the minerals in the West proceeded under local rules and customs established by the miners. The national government did not interfere with the prospectors because of its desire to promote the development of the Western United States and its territories. Consequently, when the General Mining Law was adopted, it was very general in its scope so that the customs and rules of the miners would continue to form the basis of locating mining claims. Old mining districts and informal jurisdictions have been superseded by state law but the interaction between federal and local law has remained an important aspect of the mining law.

The relationship of federal and local law should not be minimized when considering the title to the unpatented mining claim because the "location of a mining claim" consists of the accomplishment of all the acts specified by federal and local law.⁵

:FEDERAL LAW

The primary effect of the General Mining Law was the adoption of the location system for mining claims. The location system permits people to create their own interests in the public domain for mining purposes. The location system does not contemplate a grant or sale from the federal proprietor but rather envisions that a person will earn his title to a mining claim by complying with federal and state mining laws.

The location system and the relationship of federal and local law is exemplified by 30 U.S.C. § 22 which provides:

"Except as otherwise provided, all valuable mineral deposits in lands belonging to the United States...shall be free and open to exploration and purchase, and the lands in which they are found to occupancy and purchase, by citizens of the United States and those who have declared their intention to become such, under regulations prescribed by law, and according to the local customs or rules of miners in the several mining districts, so far as the same are applicable and not inconsistent with the laws of the United States."

An important feature of the General Mining Law is the absence of many specific provisions governing the mechanics of locating mining claims on the ground which aids in the establishment of rights and priorities between mineral locators. This area was left to state law or local regulation. Therefore, to determine the procedures to be followed in creating a title to a mining claim, the mineral locator must be familiar

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with the requirements of the federal law and the law of the state in which the mining claim is located and the title examination must be made with reference to both the federal and local requirements.

Even though the General Mining Law does not contain many specific provisions governing the mechanics of the location of a mining claim several important aspects of that law must be kept firmly in mind.

First, the provisions of the federal law apply to both placer and lode mining claims.⁶ The distinction between placer and lode claims is somewhat artificial but it is important nevertheless.⁷ 30 U.S.C. § 23 provides for the location of a mining claim upon veins or lodes of quartz or other rock in place bearing gold, silver, cinnabar, lead, tin, copper or other valuable deposits. 30 U.S.C. § 35 provides for the location of mining claims usually called "placers" including all forms of deposit, except veins of quartz or other rock in place. In making the distinction between lode and placer claims, the mining law is concerned with the mode of occurrence of the deposit of the valuable minerals. The characteristics of a lode deposit have been described as zones of rock in the earth's crust possessing two essential characteristics: (1) the formation is held in place by the adjacent rock; and (2) it is impregnated with or consists of valuable mineral.⁸ The placer claim has been described as ground within defined boundaries which contains mineral in its earth, sand or gravel; ground which includes valuable deposits not in place, that is, not fixed in rock.⁹

A second important aspect of the General Mining Laws is that mining claims must be located upon federal lands which are subject to sale or disposal under the general land laws of the United States. The reserved, withdrawn and acquired lands of the United States are not subject to disposal under the general land laws and are generally not locatable public domain. Reserved lands are those which have been set aside by Congress or by the executive branch of government for a specific use. Reserved lands include national parks and monuments, national forest reserves, Indian or military reservations. Withdrawn lands are those lands which have been withdrawn from disposition under the public land laws for some public land purpose. The distinction between reserved and withdrawn lands is uncertain but is apparently based upon the notion that a withdrawal is temporary while a reservation contemplates a relatively permanent segregation from the public domain. Acquired lands are those lands of the United States which were never part of the public domain or, although once part thereof, were in private ownership at the time of their acquisition by the federal government.¹⁰

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A third important aspect of the General Mining Law is that it is applicable only to minerals which are "locatable." The primary exceptions to locatability are found in the Mineral Leasing Act of 1920 and the Common Varieties Act.¹¹ Uranium is now considered as a mineral subject to location.

These features of the General Mining Law are important because no title can be created to a mining claim if it is incorrectly located, if the lands upon which the claim is located are not open to location, or if the mineral being located is not subject to location.

The General Mining Law does provide that a lode claim may not exceed 1,500 feet in length nor 300 feet on each side of the middle of the vein and that the end lines of a lode claim must be parallel. The lode claim also must be marked distinctly on the ground so that its boundaries can be readily traced.¹² In addition, the federal law prescribes that the record of the claim, to be filed according to local rules, must contain the name of the locator, the date of location and a description of the claim by reference to some natural object or permanent monument as will identify it.¹³

The General Mining Law also provides that a placer claim shall not exceed a maximum of 20 acres for an individual and that as many as eight persons may associate to claim a maximum of 160 acres. The description of a placer claim is to conform to legal survey subdivisions with exceptions in specified circumstances.¹⁴

Given the basic generality of the General Mining Law, it is not difficult to minimize that law as not having much in the way of substantive provisions. One should not be deceived by the generality of the federal mining law as it specifically provides that no location of a mining claim shall be made until a discovery of the vein or lode is made within the limits of the claim.¹⁵ The discovery provisions of the federal law apply equally to a placer claim.¹⁶ The discovery of a valuable mineral deposit is therefore the since qua non of a valid location and it is the foundation of title to a mining claim.¹⁷ The locator's title to a mining claim dates from the time of discovery.¹⁸ Without a discovery...