Solicitor's Home

including pueblo lands, in New Mexico which have been set aside by Executive order.

    With respect to chapter 126, I believe that the limitations contained in sections 6 and 25 would not apply to the construction by the United States of any water and irrigation works on any of the pueblos or Indian reservations in New Mexico unless Congress authorizes the State to impose such obligations. It is possible that S. 934 and H. R. 3517, bills introduced in the 77th Congress, 1st Session, to facilitate compliance with, and to promote the successful operation of, the Rio Grande Compact of March 18, 1938, were intended to confer, at least in part, this authority on, the State. Adverse reports on these measures were sent to the respective houses in Congress by the Secretary of the Interior on August 11, 1941. There would appear to be nothing further at this time that could be done in respect to chapter 126 of the New Mexico Session Laws.

    Chapter 153 would appear to be beneficial in the land program which is being carried out so far as the purchase of lands under that program for the several pueblos where such lands are situated within the Middle Rio Grande Conservancy District. This legislation would permit the Conservancy District to determine the total amount of the lien against the lands and the purchase of the land could be free of all of the present liens in so far as the Conservancy District charges are concerned. It will be noted, however, that according to the provisions of chapter 153 at least an attempt is made not to relieve such lands of any future assessments by a conservancy district. This phase of the problem, however, is a matter that does not appear to need any further comment at this time.

    I shall be glad to receive any further discussion of these laws which you may wish to present.

                                                                                                                                                FELIX S. COHEN,

Memorandum for the Secretary.

    At the staff conference on Wednesday, September 17, you asked that this office look into the question of the right of certain Indians of the fish-eating tribes of the Northwest to fish in streams and waters outside the boundaries of their reservations.

    The Indians do not claim the right to fish anywhere in the State on terms different from those applicable to the white man. The provisions of certain early treaties entered into prior to statehood between the Indians and the United States reserved to the Indians the right to fish at all usual and accustomed places in common with citizens of the territory. Under these treaties the Indians are convinced that they have the right to fish at usual and accustomed places without State interference or regulation. They have strongly resisted attempts of the State authorities to enforce the State law and regulations against them in this matter. The situation became so acute in the State of Washington that the Indians in that State brought several suits to enjoin the State authorities from interfering with their treaty fishing rights. Despite existing decisions of the Supreme Court of the State of Washington against the Indians and certain decisions of the United States Supreme Court seemingly adverse to them, two of these cases were recently decided in favor of the Indians by the United States District Court for the Western District of Washington. Recognizing the gravity of the situation, this Department, in cooperation with the Department, of Justice and representatives of the State of Washington, arranged for a test suit to be carried, if possible, to the United States Supreme Court.

    Sampson Tulee, an Indian of the Yakima Reservation, was charged and convicted of catching salmon and food fish with a dip bag net without obtaining a license, as required by State law. The place at which the fish were taken was conceded to be a treaty fishing ground. Tulee's conviction was affirmed on appeal by the Supreme Court of Washington in a 5 to 3 decision with one of the majority subsequently changing his views. An appeal to the United States Supreme Court has been perfected. Pending a disposition of the appeal by the United States Supreme Court, no action by this Department appears to be necessary.

NATHAN R. MARGOLD, 

Re:

1. Are the Freedmen of the Five Civilized Tribes entitled to vote on the acceptance of a constitution in pursuance of section 15 of the Oklahoma Welfare Act?

2. Would it be admissible under the act to adopt a constitution containing provisions whereby Freedmen who might be on the rolls would and could be eliminated?

1. The Freedmen having been admitted by treaties and formal tribal actions as full-fledged members in all of the Five Civilized Tribes excepting the Chickasaw Nation, they have the right to vote on any constitution to be adopted by these tribes under the Oklahoma Welfare Act.

2. As the Oklahoma Welfare Act constitutes the basis for complete reorganization of the Oklahoma tribes, the Five Civilized Tribes have full authority to reorganize their membership on a new basis excluding the Freedmen.

    Your inquiry of August 11, 1938, presented a question concerning the status of the Freedmen in the Five Civilized Tribes in connection with the desire of some of these tribes, and particularly the Seminole Nation, to organize under the Oklahoma Welfare Act of June 26, 1936.

    This question involves two problems which will be taken up in order.

1. Are the Freedmen of the Five Civilized Tribes entitled to vote on the acceptance of a constitution in pursuance of section 3 of the Oklahoma Welfare Act?

2. Would it be admissible under the act to adopt a constitution containing provisions whereby Freedmen who might be on the rolls would and could be eliminated?

"That the Chickasaw people hereby refuse to accept or adopt the Freedmen as citizens of the Chickasaw Nation upon any terms or conditions whatever and respectfully request the Governor of our Nation to notify the Department at Washington of the action of the legislature in the premises." (See United States v. The Choctaw Nation et al., 38 Ct. Cl. 558).

"There is no treaty nor statute which has come to my attention which conveys membership in any of the tribes under the Kiowa Agency to persons not of Indian blood. * * * If, therefore, these persons or other white persons have in fact been adopted as members of the tribes, the basis for such adoption must have been some definite tribal action taken with departmental approval. If no such tribal action occurred, those persons have no legal claim to membership, and no recognition as members need be accorded them by the tribe."

    It has, however, been suggested that the Secretary may issue regulations to the effect that only tribal members of Indian blood may vote on the adoption of such a constitution. It is true that section 3 of the Oklahoma Welfare Act provides that the Secretary of the Interior may prescribe rules and regulations to govern the adoption of a constitution by any tribe organized under this act. This provision corresponds to section 16 of
 

the Indian Reorganization Act which has been held to confer a broad authority upon the Secretary of the Interior to pass upon the qualifications of voters without therein being limited by past enrollments (Solicitor's opinion M. 27810, December 13, 1934). This opinion, however, pointed out that the Secretary in the exercise of his authority is bound by any statutes which may determine tribal membership. As the membership rights of the Freedmen in the Five Civilized Tribes have been fixed by treaties, which are the equivalent of statutes, and by formal tribal action in pursuance of these treaties, the Secretary would not appear to be authorized to issue regulations which would deprive the Freedmen of their right to vote on constitutions to be adopted by the Five Civilized Tribes under the Oklahoma Welfare Act.

    2. The question whether Freedmen now citizens of various Nations of Oklahoma may be excluded by appropriate provisions in constitutions to be adopted by these Nations pursuant to the Oklahoma Welfare Act must be answered in the affirmative. The Oklahoma Welfare Act represents a turning point in the organization of Indian tribes. A new type of organization on a new basis is provided by this act. It thus takes its place beside the various treaties of 1866 which after the end of the Civil War similarly provided for a new organization of the Five Civilized Tribes on a new membership basis. With the consent of Congress and pursuant to these treaties the tribes resolved to modify their membership basis and to include a large number of Freedmen who thus became Indians by law only. It would appear that the tribes should be able to modify their membership once more and, having obtained the consent of Congress through the Oklahoma Welfare Act, to arrange their membership and other affairs in a constitution to be adopted by their free vote. They are thus entitled to decide that in the future only Indians by blood shall be members of the new tribal organization that is to come into being by adoption of these constitutions. A number of Indian tribes have incorporated similar provisions in their constitutions in order to limit membership to persons of Indian blood. Among these are the Cheyenne River Sioux Tribe of South Dakota, the Quileute Tribe of the Quileute Reservation, Washington, and the Kialogee Tribal Town of Oklahoma The customary provision reads as follows:

    "The membership of the * * * Tribe shall consist of the following:

    "(a) All persons of Indian blood whose names appear on the official census roll of the tribe as of June 18, 1934.

    "(b) All children born to any member of the * * *  Tribe who is a resident of the reservation at the time of the birth of said children."

                                                                                                                                           NATHAN R. MARGOLD,

M-31417                                                                                                                                            October 9, 1941.

Re:

Does section 8 of the Oklahoma Welfare Act, excluding Osage County from the benefits of that act, apply to all Indians living in Osage County or only to the Osage Tribe of Indians?

In view of the clear unambiguous language of section 8, all Indians residing therein and all lands situated therein must be held to be excluded from the provisions of that act.

MY DEAR MR. SECRETARY:

    There has been referred to me the question of the interpretation of section 8 of the Oklahoma Welfare Act of June 26, 1936, reading as follows: "This Act shall not relate to or affect Osage County, Oklahoma." The question is whether the section was intended to exclude from the benefits of the act only the Osage Tribe of Indians or all Indians residing in Osage County, regardless of the tribe to which they belong.

    The obvious interpretation of this section would be that clearly called for by the unambiguous term "Osage County" used therein. The section thus should exclude from the act all Indians and their holdings in that county regardless of tribal membership. The legislative history of the act would appear to confirm this interpretation. The House
 

Committee on Indian Affairs in bits Report No. 2408, 74th Congress, 2d session, discussed the inclusion of section 8 in S. 2407, which became the Oklahoma Welfare Act, in the following words:

    "Because of the peculiar circumstances prevailing in Osage County the committee has recommended in section 8 of the proposed substitute that it be excluded from the provisions of the bill. The Osage Reservation is rich in mineral deposits, and the members of the tribe have derived millions of dollars in royalties and bonuses from this natural resource. There are numerous unallotted members of the tribe who  participate to a negligible amount in the tribal revenues. Some of these should be eventually allowed to take advantage of the provisions embodied in this legislation. Further studies are necessary, however, before a definite conclusion in this respect can be reached, and the committee therefore feels that the exclusion of Osage County is proper at this time."

    Consideration should furthermore be given to the parallel provisions in the Indian Reorganization Act. It is significant that that act contains both tribal and geographical exclusion and the difference between the types has not been confused. Section 13 excludes the Osage and other Oklahoma tribes by name. It also excludes the geographical areas of the Territories, colonies and insular possessions; and section 18 excludes any reservation which has voted against the application of the act.

    This office has consistently held that the exclusion of a reservation is geographical in that the act does not apply to any persons therein, even a member of a tribe covered by the act. The latest expression of this opinion is a memorandum to the Commissioner of Indian Affairs of June 30, 1941, denying the possibility of purchasing white-owned land in the name of the United States for a Quinaielt Indian on the Chehalis Reservation.

    Finally, the language of the Oklahoma Welfare Act is clear enough to include all Indians living in the county. Thus, where section I of the act authorizes the Secretary of the Interior to acquire lands for the Indians, the language of section 8 unmistakably prohibits such acquisition in Osage County regardless of whether the Indian for whom the lands is to be acquired is a member of the Osage or another Indian tribe. Also, where section 4 of the act permits any ten or more Indians to receive from the Secretary of the Interior a charter as a local cooperative association, Indians living in Osage County do not have this privilege regardless of their tribal affiliation. Similarly Indians living in Osage County cannot apply for loans from the revolving loan fund set up by section 10 of that act.

                                                                                                                                            NATHAN R. MARGOLD,

Approved: October 9, 1941.
OSCAR L. CHAPMAN,
Assistant Secretary.

    Proposed Executive order extending trust periods on Indian lands.

1. An Executive order attempting to extend restrictions upon Indian lands now restricted regardless of when the restrictions upon those lands expire is too general. The order should be an exercise of discretion based upon consideration of present conditions and land policies and their reasonably foreseeable continuation.

2. Other statutes are involved besides those cited as authority for the extension of the trust periods.

3. Land entered by Indians under the Indian Homestead Act, July 4, 1884 (23 Stat. 76, 96), is not covered by the order; it is not described by the words "public domain allotments."

    The attached Executive order to extend trust periods on Indian lands is subject to certain legal objections which cause me to return it to your office for further consideration.

    The principal objection is that the order is too general. It would extend for another 25 years the restrictions which have been extended in 1941, thus creating restrictions on land until the year 1991.

    The act of February 8, 1887 (24 Stat. 388, 389), on the authority of which this order is partially
 

based, was interpreted by the Attorney General to preclude unlimited extensions. The Attorney General (25 Op. Atty. Gen. 483, 1905) held that the words "in any case" in the act of 1887 indicated that wholesale extensions were not intended and that special examination or knowledge of particular cases was contemplated. This opinion quoted the conference report to the effect that the words "in any case" were inserted to allow the President to extend this period only in special cases. The later act of June 21, 1906 (34 Stat. 325, 326), did not contain the words "in any case" but used the words "of any Indian allottee."

    Most of the legislation giving authority for this Executive order also seems to be so limited. The language of the legislation, except for the above limitation, is otherwise very broad.

    It would seem that to allow extension only in individual cases would be too narrow an interpretation, but the extension of trust periods should probably be limited to cases in a certain class such as those expiring within a certain period. With regard to the present Executive order there seems to be no exercise of discretion since the extension applies to all cases. Since the extensions will become effective in some cases decades in the future, there is no implication that the surrounding circumstances bearing on the desirability of extension were considered. The discretion of the President should be based on a reasonably foreseeable continuation of present conditions and land policies.

    The authority listed in this Executive order includes only three statutes. There are additional statutes which would be the basis for the extension of the trust period in some cases. One of these, the act of February 14, 1923 (42 Stat. 1246), extends the act of 1887 to all lands purchased by authority of Congress for the Indians. Another statute extends the act of 1887 to additional tribes. This is the act of March 2, 1889 (25 Stat. 1013). There are also three instances where the restrictions had expired and an act of Congress was necessary to reimpose the restrictions and give the President the power to extend the trust period. These acts are the act of February 8, 1927 (44 Stat. 1061), the act of May 27, 1937 (50 Stat. 210), and the act of April 11, 1940 (54 ,Stat. 106).

    The use of the words "including public domain allotments" would not include land entered by Indians under the Indian Homestead Act of July 4, 1884 (23 Stat. 76, 96). This act has been held to be in pari materia with the act of February 8, 1887, to the extent that the President by Executive order can extend the restrictions on land held under both, but this power does not apply to homestead rights acquired by Indians seeking rights as citizens under the general homestead laws. United States v. Jackson, 280 US. 183 (1930).

                                                                                                                                            NATHAN R. MARGOLD,

Memorandum for the Commissioner of Indian Affairs.

    You have informally communicated to me a draft for a Memorandum of Understanding between the State of South Carolina, the Catawba Tribe, the Office of Indian Affairs of the United States Department of the Interior, and the Farm Security Administration of the United States Department of Agriculture. The matter would appear to be of sufficient importance to require a formal expression of opinion on my part.

    It is my understanding that this Memorandum of Understandings merely constitutes a general declaration of intention on the part of the Indians and the three agencies which are to cooperate in this program. This Memorandum is then to be implemented by such formal contracts as may be necessary to carry into full effect the understanding of the parties.

    In spite of the informal nature of this Memorandum it is important to consider the authority of the Office of Indian Affairs to enter into such an agreement as the one here proposed. The agreement provides in effect for a cooperative venture of the four parties concerned in order to bring relief to the remainder of the Catawba Tribe in South Carolina.

    By the treaty of 1840 between the Catawbas and the State of South Carolina, the State took charge of this tribe and has since made considerable expenditure on behalf of the tribe. The Federal Government did not take jurisdiction over these Indians until the fiscal year 1941, when the Interior Department Appropriation Act appropriated $7,500 for the relief of the Catawba Indians. This amount was included in the $2,854,520 appropriated in that bill for the general support of Indians and administration of Indian property. (See Conference Report to accompany H.R. 8745;
 

page 6). While thus no special act of Congress was passed expressly granting to the Department of the Interior jurisdiction over the Catawbas, the special appropriation made for them in the 1941 Appropriation Act implies the grant of such jurisdiction for the purposes for which these funds were appropriated. This intention came out clearly in the hearings before .the Senate subcommittee when first an appropriation for the Catawbas was discussed, which at that time was figured at $15,000. During the course of those hearings on H.R. 8745 (76th cong., 3d session, page 467), Senator Hayden stated as follows:

    "* * * Then all we would have to do, as a practical matter, would be to increase the sum of $2,846,000 by $15,000 and indicate in the report that it was intended for the Catawba Tribe of Indians, and you would do all the rest?

    Mr; Zimmerman: 'I think that would be correct, Senator.' "

    It is true that this agreement is not merely one between this Department and the State, but that there are two other parties, the Indians themselves, to be incorporated under State law, and the Farm Security Administration, a Federal agency. Nothing in the Johnson-O'Malley Act would appear to prevent the addition of such other parties to the agreement. As a matter of fact, private corporations are one of the agencies enumerated in section 452 with which contracts under the Johnson-O'Malley Act may be made by the Department. As to the inclusion of another Federal agency in this venture, the additional help provided by it serves only to strengthen the desirability of the agreement and to increase the effectiveness of the arrangements contemplated by the Johnson-O'Malley Act.

    In order to permit this agreement to be entered into on the part of the State of South Carolina, the State Legislature inserted a provision in section 5 of its Deficiency Appropriation Act of 1941, which set up a committee consisting of two appointees of the Governor, two members of the Senate, and: two members of the House of Representatives. This committee was authorized "to negotiate and enter into a contract with the Federal Government for the purpose of bettering the condition of the Catawba Indian Tribe in South Carolina." For that purpose the committee was authorized to obligate the State to an extent of $75,000. The agreement is to be signed by the Governor and the members of this committee. This would appear to constitute sufficient authority for the State to enter into this agreement.

    In view of the informal character of the Memorandum the signature of the members of the existing business council of the Catawba Indians would be sufficient. Formal contracts as required may, of course, be entered into after the Indians have incorporated under the laws of the State of South Carolina.

    While there is in principle no legal objection to the form and substance of the Memorandum, I have made certain changes in its language especially in order to emphasize its informal character by pointing out that the various obligations enumerated in .the Memorandum express merely the intention of the parties rather than a final and binding agreement.

    It is further noted that on page 2 under No. 2 (a) of the intended obligations of the State of South Carolina, the State promises to recommend to its convening general assembly an appropriation for the fiscal year 1942-1943 for the Catawbas of not less than $9,500 with the proviso to the effect that "the Catawba Indian association agrees that no requests will be made for such an appropriation in the future." Such a proviso would seem to be unnecessary and unjustified in that the Catawba Indians neither can, nor should, be deprived of their right to petition the legislature of their State for appropriations needed for their
subsistence. This proviso has therefore been eliminated.

    It is further noted that the requirement included in the original draft submitted on October 9 to
 

the effect that the Catawba Indians promised "to execute, in favor of the State of South Carolina, a release and quitclaim of all claims and actions, of whatsoever nature, against the State of South Carolina" (p, 5, No. 3) has been eliminated from the present draft. This elimination is most desirable in that it avoids a procedure of doubtful legality which could have consisted in using a contract under the Johnson-O'Malley Act in order to deprive the Indian tribe of claims which it might be able to enforce in the courts.

    Finally your attention is drawn to the obligations of the Farm Security Administration which on page 6 of the draft is "to assume the entire responsibility for management, operations, and supervision of the (Catawba Indian) Association." While it is clear that the Farm Security Administration can and should take complete charge of the rehabilitation program to be initiated by this agreement, it cannot take charge of the association itself, if that association is to be a bona fide corporation under the laws of the State of South Carolina. I have therefore substituted for the last word of the language just quoted, "Association," the words "program initiated by this Memorandum of Understanding."

                                                                                                                                            NATHAN R. MARGOLD,

  THIS MEMORANDUM OF -UNDERSTANDING, entered into as of the ____ day of _________, 1941, between the State of South Carolina, acting by and through the Governor of the State of South Carolina, and the Special Committee on the Catawba Indians, the Indians of the Catawba Reservation, acting by and through their elected Business Committee, the United States Department of the Interior, acting by and through the Commissioner of Indian Affairs with the approval of the Secretary of the Interior, and the Farm Security Administration of the United States Department of Agriculture.

    WITNESSETH:

    WHEREAS, it is to the mutual benefit of the State of South Carolina and of the Catawba Indians in York County, South Carolina, that the Catawba Indians be rehabilitated upon a self-sustaining basis, and accorded equal treatment with other Citizens, without discrimination; and

  WHEREAS, the State of South Carolina has requested the cooperation of the Farm Security Administration and the Office of Indian Affairs in the rehabilitation of the Catawba Indians; and

    WHEREAS, the Farm Security Administration, with the financial and technical aid of the State of South Carolina and the Office of Indian Affairs, is desirous of rehabilitating said Catawba Indians, and in furtherance of such purpose, to aid them in conducting nonprofit activities and other social, educational and welfare activities;

    Now, THEREFORE, the parties to this Memorandum of Understanding do hereby declare it to be their intention to supply, subject to the execution of appropriate contracts whenever necessary hereunder, the following aid and assistance for the purpose of promoting the rehabilitation of the said Indians:

    The State of South Carolina will:

(1) Contribute to the Catawba Indian Association hereinafter described the sum of $75,000 immediately upon request of the Farm Security Administration of the United States Department of Agriculture;

(2) Recommend to its next convening General Assembly the passage of appropriate legislation for the following purposes:

(a) For the fiscal year 1942-1943 an appropriation to the Catawba Indian Association of not less than $9,500, to be used as directed by the Farm Security Administration to aid in rehabilitating the said Indians.

(b) To insure to the members of the Catawba Indian Tribe all the rights and privileges of any other citizens of the State of South Carolina without discrimination; provided, however, that they shall continue to be subject to the laws of the State of South Carolina;

(c) To convey all lands, and improvements thereupon and appurtenances thereunto belonging, now within the boundary lines of the present Catawba Indian Reservation, to the Catawba Indian Association;

(3) Admit members of the Catawba Indian Tribe into its public schools, including secondary schools, high schools, vocational schools, and State institutions of higher learning, on the same terms as other citizens of the State of South Carolina.

The Catawba Indian Tribe will organize itself as an incorporated cooperative association, to be known as the Catawba Indian Association, with assistance and advice of the Farm Security Administration. The Association will carry on the program of rehabilitation advised and recommended by the said Farm Security Administration. Said Association will be authorized to accept and receive all financial aid from the State of South Carolina, or from any other source, and will expend such moneys in the manner agreed upon from time to time by the Association and the Farm Security Administration. Said Association will organize and conduct rehabilitation programs for the Catawba Indians, will hold title to all its lands in trust for members of the Association, provided that the Association shall not alienate or encumber such lands except as security for loans to the Association by a Federal agency, or in accordance with the terms of the Charter of. the Association, and will be the sole agency through which the Catawba Indians will deal with the other parties to this Memorandum of Understanding.

The United States Department of the Interior, through the Office of Indian Affairs, will, to the extent that its personnel and funds are available therefor and so long as the Catawba Indians require assistance:

(1) Contribute annually to the Catawba Indian Association as the agent of the State of South Carolina, pursuant to the terms of the Johnson-O'Malley Act, $7;000, if appropriated by the Congress of the United States, or such sums, if any, as are made available for contribution by the Congress. Such sums shall be used by the Catawba Indian Association for the rehabilitation and support of the members of the Association, but shall not be used for administrative expenses of the Association:

(2) Delegate members of its staff from time to time, if requested by the Farm Security Administration and the Association, to assist the Catawba Indians in the development of Indian arts and crafts and in the development of markets therefor;

(3) Assist the other parties to this Understanding in developing the educational program for the Catawba Indians;

(4) Assist the Farm Security Administration in making medical examinations of all members of the Catawba Indian Tribe, and whenever possible, to hospitalize tubercular cases in an Indian Service sanitarium;

(5) Organize a Catawba Indian CCC project for conservation work on lands of the Association, and to employ and pay members of the Association for such work, provided that the Farm Security Administration will assist in providing the necessary equipment;

(6) Advise the Farm Security Administration with respect to the general and social welfare of Catawba Indians.

The Farm Security Administration of the United States Department of Agriculture will assist the Catawba Indians with the organization of a cooperative association to be known as the Catawba Indian Association, and make loans to said Association not to exceed $_______, in accordance with the policies and procedures of the Farm Security Administration, for the development and construction of real property of the Association, and assume the entire responsibility for management, operations, and supervision of the program initiated by this Memorandum of Understanding.

    IN WITNESS WHEREOF the parties have hereunto set their hands and seals this ___ day of ________, 1941.

APPROVED:
_______________________________

APPROVED:
_______________________________
Secretary of the Interior.

APPROVED:
_______________________________
Secretary of Agriculture.

STATE OF SOUTH CAROLINA

BY _____________________________

BY _____________________________
THE CATAWBA INDIANS

BY _____________________________
Chairman, Business Committee.

OFFICE OF INDIAN AFFAIRS

BY _____________________________
FARM SECURITY ADMINISTRATION

BY _____________________________
Administrator.
 

M-31579                                                                                                                                               January 15, 1942.

Synopsis of
Solicitor's Opinion

Re:

Whether a patentee under the homestead laws of ceded Colville Indian Reservation lands whose entry was properly cancelled and years afterwards reinstated and patented, is entitled to be paid the value of timber caused to be cut and removed from the land by the Indian Agency between the time of cancellation and the time of reinstatement.

1. That the patentee's entry having been properly cancelled and not reinstated at the time of the severance of the timber, he had no right of possession or equitable or legal rights in the land at that time.

2. That the rule that patent to a homestead entry relates back to the date of timber cut and removed in the interim between entry and patent only in cases where the entryman was maintaining his inchoate possessory right at the time of the cutting and removal and continued to maintain it until he perfected the entry.

3. That the doctrine of relation is a fiction of law intended only for the protection of persons who without fault of their own might otherwise sustain an injury, and does not relate further back than the inception of the equitable right and the courts have refused to apply it where the entryman or claimant, though having an entry or claim pending, had no legal or equitable right to the land at the time of the timber trespass, but acquired his patent by virtue of a subsequent purchase of the land.

4. Where the original entry of the patentee making demand for payment for the cutting of the timber was rightfully cancelled for failure to pay the purchase price of the land with interest and he failed to embrace the opportunity extended to him to have his entry reinstated or make a second entry but remained silent for about 8 1/2 years and did not apply for restoration of his rights until after the timber was partially cut, that he had no right of possession or equitable or legal right in the land at the time of the cutting, that the United States was the exclusive owner of the timber at the time of cutting, that whatever rights he formerly had were lost by his laches in failing to exercise his rights, that the reinstatement of his entry was not based on any then present equitable or legal right, that the patent he obtained did not relate back of the date of reinstatement of the entry and the patentee is not entitled to payment for the timber by application of the doctrine of relation.

5. That assuming patentee maintained settlement after cancellation of his entry, such settlement did not authorize the reinstatement of his entry, and further assuming that such settlement was resumed for the purpose of initiating a new right of entry, the title to the timber, nevertheless, would remain in the Government until the conditions of the law had been fulfilled, and as patentee never acquired a patent based upon an entry that had its inception in such a settlement but upon rights acquired, if at all, after the timber was cut, he is not entitled to be paid for timber appropriated theretofore.

MY DEAR MR. SECRETARY:

    At the request of the Assistant to the Commissioner of Indian Affairs there has been submitted for my consideration and opinion the question whether William G. Harper is entitled to be paid the stumpage value of timber cut and removed pursuant to a contract with the Indian Agency from the ceded Colville Indian Reservation lands by Landreth Brothers Lumber Company after the homestead entry of Harper on the land on which the timber was cut had been cancelled and before his entry was reinstated and patent issued.

    The records of the General Land Office disclose the following facts: On November 5, 1925, Harper made homestead entry, Spokane 015304, under section 2289, Revised Statutes, and the act of March 22, 1906 (34 Stat. 80). The entry was subsequently amended and allowed to describe
 

lot 4 N 1/2 SE 1/4 NW 1/4, SW 1/4, NW 1/4, Sec. 1, T. 34 N., R. 31 E., W. M. Final proof was submitted November 11, 1929, and on October 15, 1930, final certificate was authorized upon completion of the payments of the purchase price. The act of March 22, 1906, supra, requires that one-fifth of the purchase price shall be paid at the date of entry and the balance thereof in five equal annual installments. The joint resolution of March 19, 1920 (41 Stat. 535), permits an extension of time from year to year for payment of the installments of the purchase money upon the payment of interest in advance at the rate of 5 percent per annum, subject to the condition "That the last payment and all other payments must be made within a period not exceeding one year after the last payment becomes due by the terms of the act under which the entry was made * * *." The joint resolution further provides:

    "* * * That failure to make any payment unless the same be extended, or to make any extended payment at or before the time to which such payment has been extended herein provided shall forfeit the entry and the same shall be cancelled and any and all payments theretofore made shall be forfeited."

    The undisposed of ceded lands on the former Colville Indian Reservation were temporarily withdrawn by the Secretary of the Interior on September 19, 1934, "from disposal of any kind, subject to any and all existing valid rights, until the matter of their permanent restoration to tribal ownership as authorized by section 3 of the act of June 18, 1934, supra, can be given appropriate consideration." Section 18 of that statute (act of June 18, 1934, 48 Stat. 988, 25 U.S.C. sec. 478); provides that the act shall not apply to any reservation if a majority of the Indians on the reservation shall vote against its application. The request of the Assistant to the Commissioner of Indian Affairs for an opinion states that the Colville Indians voted against the acceptance of the act.

    By letter to Harper of March 15, 1940, the Commissioner of the General Land Office alluded to the fact that the land had not been restored to tribal ownership and to the previous correspondence with Harper and said:

    "If you are now residing upon the land embraced in the entry and making it a home to the exclusion of a home elsewhere, this office will consider an application to reinstate the entry, provided you file it * * * with a remittance of $124.80 due on the purchase money and the $36.97 due on the interest December 31, 1936. The application should be filed immediately in the District Land Office at Spokane, and accompanied with corroborated affidavits of two witnesses."

    "* * * I have lived on the land for over

three years. But of late have had to work elsewhere to help make a living for my family. But will reside upon land again when I send in the final payments to your office."

    The Assistant Commissioner of Indian Affairs reports that the land in question is a part of the West Fork Timber Unit and that the holders of the logging contract on this unit, the Landreth Brothers Lumber Company, marked the trees on the SE 1/4 SW 1/4 NW 1/4 Sec. 1, for cutting early in January 1940, and in that month and in May 1940 cut and removed from Harper's former homestead 76,220 feet, B.M., of timber of the value of $228.60 and that Harper is demanding payment for the value of that timber. The Assistant Commissioner invites consideration of certain facts from which he concludes that the entry was not made in good faith for a home but for the purpose of speculating in the timber and that Harper made fraudulent representations in his final proof and that the entry was reinstated upon representations not in fact true, and his position is that Harper should not be paid because of these circumstances indicating fraud and bad faith. Among other things, it is alleged, in substance that at the time Harper made his original entry it was well known in the region that the timber was to be sold and that the advertisement of the West Fork Unit had been prepared: that in 1929 Harper sold and caused to be cut $1,062.92 worth of timber as timber on his homestead, which subsequently was ascertained to have been cut from an adjoining Indian allotment and from tribal land, damages for which were collected from the logging company that cut the timber; that Harper's house, improvements and cultivation were outside his homestead and on Indian land, and at the time of entry the land was all surveyed with appropriate markers in the field; that he had not lived on the land for the past nine years, although his living on the land was made a condition for reinstatement. Attention is invited to the fact that Harper did not apply for reinstatement until after the first timber was cut in 1940.

    It has been held in any number of cases that a patent from the Government relates back and takes effect from the date of the entry (see cases, sec. 15, 43 U.S.C.A., note 18), and this doctrine of relation has been applied to defeat suits instituted by the United States to recover the value of timber unlawfully cut and removed from a homestead entry by or with the consent of the entryman, upon which after the trespass the entryman acquired final certification by the perfection of and payment for his entry. United States v. Ball, 31 Fed. 667; United States v. Freyberg, 32 Fed. 195. The rule that the patent relates back to the date of entry has also been applied to sustain an action by a homestead or other entryman of public land who sued for the recovery of the value of timber cut and removed from his entry during the time his rights were inchoate and before he acquired the equitable or legal title to the land. See Knapp v. Alexander Co., 237 U.S. 162; Peyton v. Desmond, 129 Fed 1. For other cases see Public Lands, sec. 502, 50 C.J. 1103. The doctrine of relation, however, is only a fiction of law designed to promote justice (Gibson v. Chouteau, 13 Wall. 92, 101: United States v. Detroit Lumber Co., 200 U.S. 321, 334), and does not apply to make that wrong which was innocent when done (Flint et al. v. Gordon, 41 Mich: 420, 2 N. W. 648; Richardson v. Midwest Refining Co., 39 Wyo. 58, 270 Pac. 154); and cannot be invoked by one whose default and lathes would make it work an injury to another (Evans v. Durango Land & Coal Co., 80 Fed. 433). A title by relation extends no further backwards than the inception of the equitable right (Hussman v. Durham, 165 U.S. 144, 148).

    An examination of the cases where the right of the entryman was sustained to recover damages for timber cut and removed from his entry in the interim between the initiation of his rights and their perfection by final certificate or patent, plainly discloses that the entryman was maintaining his equitable right acquired by his entry and right of possession thereunder at the time of the alleged severance of the timber from the entry, and that the doctrine of relation was applied for the reason that he was maintaining his inchoate possessory right which was capable of perfection and which he continued to maintain until it was
perfected. There are instances where the courts have declined to apply the doctrine that upon issuance of patent the title relates back to the time of entry so as to cut off the right of the United States to recover for timber severed and removed between entry and patent. In the case of United States v. Norris, 41 Fed. 424, Gill made homestead entry in 1877. The timber thereon was sold by him and logged in 1883 and 1884. He never complied with the homestead law in any respect. In 1889 he made payment for the land and acquired patent under the act of June 15, 1880 (21 Stat. 237). Section 2 of said act authorized "persons who have heretofore under any of the homestead laws entered lands properly subject to such entry" to "entitle themselves to said lands by paying the government price therefore," provided the pur-
 

chase shall not interfere with the rights or claims of others who may have subsequently entered such lands under the homestead laws (William C. Pascoe, 1 L.D. 50). The Government sued the purchaser for the value of the logs, who set up the defense that the title of the entryman related back to the date of entry. The court, in upholding the right of the Government to recover the value of the timber, said:

"Whatever may be his [the entryman's] title now against the government, it would be carrying the doctrine contended, for by defendant's counsel to unwarrantable lengths to say that the government is estopped from holding the defendant liable in this suit for the value of the timber cut from the public lands, and appropriated by him, at a time when the ownership therein, in law and equity, was in the sovereign."

    In Evans v. Durango Land & Coal Co., 80 Fed. 433, 25 C.C.A. 531, the case came up on a demurrer to the bill of complaint. The facts in so far is they have bearing on the application of the doctrine, of relation, are briefly as follows: October 2, 1880, Evans filed coal declaratory statement which was suspended. During the suspension on November 26, 1881, one McMaster conveyed the land embraced in the declaration to one Bell in trust for the defendants and on December 1, 1881, filed what was alleged to be a pretended entry under the coal land laws while the land was withdrawn from sale. Thereafter the Commissioner of the General Land Office issued instructions relating to the character and sale of the land, and Evans was notified to make entry and payment. He tendered application to purchase and payment on June 27, 1892, which was refused by the register of the local office because of the pending application of McMaster. Evans thereupon instituted contest against the application of McMaster on the ground it was made in the interest and for the benefit of defendants. The contest was sustained on the ground alleged and McMaster's application was rejected. Evans was thereafter allowed to, and did enter the land under the coal land laws and made, payment December 31, 1894, and received finals certificate upon which patent issued February 28, 1895. Evans sued the defendants for the value of the coal removed by them from January 8, 1885, down to and beyond the time of issuance of patent.

    The court cited Hussman v. Durham, supra, and other cases for the propositions that there is no hard and fast rule giving a patent retroactive effect by relation to the time when the entry is fully consummated by payment and that the doctrine of relation is a legal fiction intended only to apply to the protection of persons who, without fault of their own, might otherwise sustain an injury and never where it has a contrary effect. It was held that Evans acquired only a preferential right of entry by his declaratory statement and not an equitable title; that his equitable right had its origin in the payment made December 31, 1894, his preferential right having expired October 2, 1881; that the contest proceedings showed that McMaster's filing was cancelled because it was made for the benefit of others and not because of any preferential right of Evans, and it would be presumed that had McMaster's claim been valid it would have been allowed. The court said:

    "* * * Inasmuch as the plaintiffs invoke the equitable doctrine of relation for the purpose of recovering the value of coal which the defendant company has taken out of the land in controversy, doubtless at great labor and expense, and during a series of years, they ought to show, by proper averments, why Evans remained silent and inactive for such a long period after his declaratory statement was filed, and they should also show that his apparent failure to comply with the law and to exercise due diligence was excusable. Without some

further allegations showing how it happened that no action was taken by Evans towards perfecting his claim between October 2, 1880, and June 27, 1892, although for a greater part of that time the defendant company was in possession of the land, and mining coal thereon, the inference is clear that he must have been guilty of gross laches in prosecuting his claim, and in asserting his rights; and such laches on his part would seem to be a sufficient reason why his patent should not be given effect by relation as of the date when he filed his declaratory statement. It may be that facts can be shown which will excuse Evans' apparent want of diligence in perfecting his title, but we are constrained to hold that the present complaint: does not contain such a showing nor any averments which would justify us in holding that his patent should be given effect by relation as of a date anterior to December 31, 1894.* * *"

    Irrespective of the question of the right of reinstatement, the fact is, as shown by the record, that Harper did not take advantage of the opportunity to reinstate his entry or attempt to make a second entry, but remained silent for over 8 1/2 years and until the timber was marked for cutting and part of it was cut before attempting to have his rights revived. At the time of the cutting of the timber, Harper had no right to the possession of the land whatsoever and no equitable right to acquire the title thereto, and aside from the question whether the Indian Agency had the right to sell the timber and authorize its cutting, in view of the then status of the land, there is no question that at the time of severance of the timber from the land the United States was the exclusive owner of both the land and timber and entitled to dispose of it.

    The reinstatement of the entry subsequently was placed on the grounds that the land had not been restored to tribal ownership (in other words that the land remained subject to disposal under the public land laws), and the final payment under the former entry had been made. Whether the Commissioner had authority to do this, and whether the patent is valid, are questions not material to the present inquiry. This is so because, in any event, the Department may, as we have seen the courts have done, inquire into the facts and circumstances to determine the time when the rights secured by a patent have their inception. From a review of the record it appears that at the time the timber was cut, Harper had no right of possession and no rights either legal or equitable in the land. The inceptive right he had to acquire title to the timber, and as homesteader to cut and convert to his own use such timber on the land as might be necessary to remove with a bona fide purpose to clear the land for cultivation, was lost by the previous cancellation of the entry. Whatever rights he may have had to reinstatement or to initiate new rights by second entry were lost by his laches in failing to exercise them. Assuming that the act of reinstatement was motivated by a desire to prevent Harper from losing the fruits of his labor and expense in compliance with the homestead law, it is clear that the reinstatement was not based upon any existing right or equity in the land and that he acquired no new inceptive right to obtain title until the entry was reinstated.

    I am, therefore, of the opinion that Harper is not entitled to be paid for the timber under any fiction of law that he was constructively in possession of the lands at the time of severance and appropriation thereof under the doctrine that the patent relates back to the date of original entry.

    The Acting Commissioner of Indian Affairs invites attention to the following excerpt from the letter of the Commissioner of the General Land
 

Office to the Commissioner of Indian Affairs dated April 11, 1941:

    "If at the time of the withdrawal of the undisposed of ceded Colville lands by order of the Secretary of the Interior dated September 19, 1934 (54 I.D. 559), issued under authority of the act of June 18, 1934 (48 Stat. 984), the entryman was maintaining a valid homestead settlement claim, and if he continued to maintain such settlement claim to the date of the cutting of the timber, we are of the opinion that he had such a possessory right to the land as made the sale of the timber thereon by the Indian Agency improper. The land, until it was withdrawn, was subject to both settlement and entry. Perhaps a field investigation should be made to determine the facts as to settlement."

    If the view is based upon the argument that Harper, equally with others qualified to settle upon the lands, could, notwithstanding the cancellation of his prior entry initiate a new right of entry by settlement and may have been such a settler at the time of the trespass and acquired thereby rights in the timber on the land, there are two answers. The first is that notwithstanding any such settlement, the ownership of the land and timber thereon remains in the Government until the conditions of the law are fulfilled. Stone v. United States, 167 U.S. 178, 191, 193. The second answer is that Harper never acquired a patent based upon an entry that had its inception in such a settlement, but upon rights acquired, if at all, after the timber was cut and removed. It follows that he acquired no interest whatsoever in the timber sold by the Indian Agency.

    For the reasons stated, the demand by Harper to be paid for such timber should be refused.

                                                                                                                                             NATHAN R. MARGOLD,

Approved: January 15, 1942.
OSCAR L. CHAPMAN, Assistant Secretary.

M-31476                                                                                                                                              February 3, 1942.

Memorandum for the Assistant Secretary:

    On September 11, 1941, you referred to me for an opinion the question by what methods certain tracts situated within the original allotment of Jap Nelson, deceased Yakima Allottee No. 985, could be acquired for the use of the Irrigation Service on the Wapato Indian Irrigation project, Washington.

    A similar question was dealt with in my memorandum for the Commissioner of: Indian Affairs dated August 14, 1937. The conclusion reached therein, in so far as it relates to the instant case, was to the effect that Indian lands in heirship status with one or more of the heirs being incompetent or under age could be caused to be sold by the Secretary under the authority given in section 1 of the act of June 25, 1910 (36 Stat. 855; 25 U.S.C. sec. 372). The main difficulty in such a case lies in the fact that section 372 provides that "upon payment of the purchase price in full, the Secretary of the Interior shall cause to be issued to the purchaser patent in fee for such land." As in the instant case the United States is the purchaser of the land, this provision would lead to a legal absurdity by requiring the issuance of a fee patent to the United States.

    In the above mentioned memorandum I dealt with the situation arising as a consequence of a land purchase under section 5 of the act of June 18, 1934 (84 Stat. 984). This section provides that title to land purchased thereunder shall be taken by the United States in trust for the tribe or individual Indian for whom it is acquired. In this connection I wrote:

    "* * * In the face of this dilemma it appears to be a reasonable view that the requirement of section 372, that a patent in fee be issued to the purchaser, is inapplicable where the United States is itself the purchaser, and that in this case section 5 of the act of June 18, 1934, supersedes and amends the relevant provisions of section 372. This view is in accord with the familiar rule that a limiting statute does not run against the sovereign."

forth specifically how title is to be taken to the lands acquired, the rule that a limiting statute does not run against the sovereign still governs the instant case.

    In view of these conclusions it is my opinion that the Secretary may sell the tracts in question under the authority given by 25 U.S.C. sec. 372 without having to issue a patent in fee. This power to sell carries with it by necessary implication the power to convey title to the land. The same situation arose in connection with the purchase of Indian lands in heirship status under section 372 for the Shoshone Tribe and individual Shoshone Indians under the Shoshone Judgment Fund Act of July 27, 1939 (53 Stat. 1128, 1130). The method of conveying title used in that case was by an order signed by the Secretary conveying the title of all the heirs to the United States in trust for the tribe or the individual Indian. It is suggested that the same method be used the instant case.

    I may add that this type of order was recently submitted to the Attorney General in connection with the acquisition of certain school lands on the Pine Ridge Reservation for examination of the title. Should, upon receipt of his reply, any further question remain as to the validity of this method of conveyance, I shall be glad to consider it.

                                                                                                                                          NATHAN. R. MARGOLD,

Approved and referred to the Commissioner of Indian Affairs
for appropriate action.    February 4, 1942.
OSCAR L. CHAPMAN, Assistant Secretary.

 Memorandum for the Commissioner of Indian Affairs:

    I am unable to agree with the legal views embodied in the attached letter, which, in effect, recommends criminal prosecution against Indians who, in the exercise of treaty rights, and upon their own reservation, decline to conform to general regulations issued under the authority of the Migratory Bird Treaty Act. (Act of July 3, 1918 (40 Stat. 755); 16 U.S.C. secs. 703-704.)

    The right to hunt on their own reservation was an essential part of the arrangement with the Yakima Tribe consummated by the Treaty of June 9, 1855 (12 Stat. 951). The proceedings in the council with the Yakima Tribe leading to this treaty show a constant concern on the part of the Indians and repeated assurance on behalf of the Federal Government that in the lands that were to be reserved to the tribe the Indians would have the right to take game, as well as the other common incidents of ownership, and that no white man would be allowed to enter upon the reservation for the purpose of interfering in any way with the Indians in the administration of their own laws or in their efforts to gain subsistence from the resources of the reservation. See pages A22, A87, A88, A91, A92 of official proceedings transmitted by Governor Isaac I. Stevens and General Joel  Palmer to the Commissioner of Indian Affairs on June 12, 1855. Although the treaty did not refer in express terms to hunting rights upon the reservation, the protection of such rights was necessarily implied by the provision that the reservation should be "set apart * * * for the exclusive use and benefit of said Confederated Tribe and bands of Indians, as an Indian reservation; * * *." (Article II.) This certainly, was the Indians' understanding of the treaty.

    While it is established that Congress has the right to violate treaty obligations, the converse of this rule is that an intent to do so will be found only where the language of the legislation leaves no room for any other possible construction.

    "A treaty will not be deemed to have been abrogated or modified by a later statute unless such purpose on the part of Congress has been clearly expressed." Cook v. United States, 288 U.S. 102, 120 (1933); and see United States v. Hayne, 264 U.S. 446, 448 (1924); Chow Heong v. United States,112 U.S. 536, 549-550 (1884); United States v. Forty-three Gallons of Whiskey, 108 U.S. 491, 496 (1883).

    In the present case neither the Migratory Bird Treaty with Great Britain (39 Stat. 1702) nor the statute providing for its enforcement deals expressly with the question of Indian treaty rights, although in both the Migratory Bird Treaty and the statute certain privileges are granted to Indians regardless of former Indian treaty rights and these privileges, of course, apply to treaty Indians as well as nontreaty Indians. Neither do the regulations issued under the Migratory Bird Treaty Act deal expressly with the question of special In-
 

dian treaty rights. On the contrary, the regulations repeatedly refer to State laws (50 CFR 1.8, 1.9, 1.11, 1.51, 1.53, 1.61) and may therefore properly be viewed as applying only to persons subject to State laws, and thus not to Indians on Indian reservations. Under the circumstances, without questioning the power of Congress otherwise to provide, I must hold that Congress has not actually abrogated the treaty right of members of the Yakima Tribe to utilize for their needs the wildlife resources of the Yakima Reservation.

    If it should appear that the execution of the Migratory Bird Treaty necessarily requires a limitation of Indian hunting rights on Indian reservations, then the United States would be under an international obligation to Great Britain which would conflict with its treaty obligation to the Yakima Tribe. If such a conflict of obligations can be settled by the voluntary agreement of the Yakima Tribe to accept appropriate limitations upon its hunting rights in exchange for other concessions which the Federal Government may lawfully grant, then further legislation, would not be necessary. In the absence of such agreement, it would appear that only Congress can determine which of two inconsistent treaty obligations shall be violated and which shall be enforced.

    At the present time there is no agreement, no regulation, and no statute which expressly abrogates any Yakima treaty rights with respect to hunting on the Yakima Reservation. Under the circumstances I think it would not be proper for this Department to support criminal proceedings against members of the Yakima Tribe based upon the exercise of such treaty rights.

    It may be that certain statements in the opinion rendered on June 15, 1934, by the Acting Solicitor of this Department on hunting rights of the Swinomish Indians (54 I.D. 517), not essential to the actual holding in that case, are inconsistent with the foregoing conclusions. If that opinion suggests either that hunting rights on the reservation were not protected for the future by the treaty there under consideration, or that, despite any such protection, such rights were plainly abrogated by the Migratory Bird Treaty Act of July 3, 1918 (40 Stat. 755), these are propositions which can no longer be maintained in the light of court decisions rendered since that opinion was issued. Shoshone Tribe v. United States, 299 U.S. 476 (1937); Chippewa Indians v. United States, 301 US. 358 (1937); United States v. Cutler, 37 F. Supp. 724 (D.C.E.D. Ida. 1941). Certainly the Yakima Indians understood that on the reservation which they were retaining they would have the right to avail themselves of the sources of food supply which they had hitherto used. According to well-established principles of construction the Indians' understanding of the treaty should prevail if the treaty itself is ambiguous. Worcester v. Georgia, 6 Pet. 515, 582 (1832); Jones v. Meehan, 175 U.S. 1 (1899); United States v. Shoshone Tribe, 304 U.S. 111 (1938). There may be some doubt as to whether Congress, in enacting the Migratory Bird Treaty Law, intended to abrogate prior Indian treaty rights, but again any such doubt should, under persuasive authorities, be resolved in favor of the Indians. Winters v. United States, 207 U.S. 564 (1908), and see cases cited, supra. At any rate, in view of the foregoing considerations, it would hardly be proper for the Department, charged with the protection of Indian rights, to support criminal proceedings against members of the Yakima Tribe based upon their exercise of treaty rights which they regard as sacred.

                                                                                                                                            NATHAN R. MARGOLD,

Re:

Interpretation of the agendum and payment provisions in an oil and gas lease on Indian lands.

1. Where a lease is for a term of 10 years and as much longer thereafter as oil or gas is found in paying quantities, and where the development of only one gas well in paying quantities is sufficient to continue the life of the lease, the lease is not subject to cancellation after the expiration of the primary term if there is a gas well thereon capable of producing gas in such quantities upon which the required royalty of $300 per annum is paid, even though such well is shut in because of market conditions and gas is not sold therefrom.

2. Where payment is made by the lessee of $300 annual royalty on one shut-in gas well, he may pay $100 annual rental on a second shut-in gas well under the provision in the lease providing for forfeiture of an unprofitable gas well unless a $100 annual rental is paid for retaining gas producing privileges.

The Honorable,
The Secretary of the Interior.

MY DEAR MR. SECRETARY:

    You have requested my opinion on certain basic questions presented to you by the Geological Survey, through the Office of Indian Affairs, concerning the interpretation of lease No. 37992, contract 127ind-858, Susan Riddle, Choctaw Indian allotment 15694, upon which decisions are desired in order that the proper royalty accounting may be made.

    The lease in question is dated May 31, 1918, and was approved by the Department on July 18, 1918. The assignment by the original lessee, The Quinton Spelter Company, to the Utilities Oil Production Corporation, pertaining to the W 1/2 NE 1/4
Sec. 12, T. 7 N., R. 18 E., Ind. M., was approved by the Department on October 11, 1929. The lease is for a term of "ten years from the date of the approval hereof by the Secretary of the Interior, and as much longer thereafter as oil or gas is found in paying quantities, * * *."

    Development of the oil and gas deposits underlying the lease consisted of two dry gas wells completed in 1918 and 1921, which were producing until March 1930, when they were shut in. The open flow of each well is approximately 200,000 cubic feet per day and the shut-in pressure is approximately 150 pounds per square inch. Gas from well No. 1 was sold prior to its being shut in during March 1930. Gas from well No. 2 was never sold but was used only for lease operations. Since the wells were shut in the lessee has continued to pay royalty for well No. 1 at the rate of $300 per an num and rental for well No. 2 at the rate of $100 per annum. The reasons given for not utilizing the gas subsequent to 1930 are insufficient pressure to enter the main shipping line and marketing conditions which do not justify the installation of equipment to boost the pressure to line requirements.

    The provisions in the lease relating to the payment of royalty and rental on gas wells are as follows:

    "* * * And the lessee shall pay as royalty on each gas producing well three hundred dollars per annum in advance, to be calculated from the date of commencement of utilization: Provided, however, in the case of gas wells of small volume, when the rock pressure is one hundred pounds or less, the parties hereto may, subject to the approval of the Secretary of the Interior, agree upon a royalty, which will become effective as a part of this lease; Provided, further, That in case of gas wells of small volume, or where the wells produce both oil and gas or oil and gas and salt water to such extent that the gas in [is] unfit for ordinary domestic purposes, or where the gas from any well is desired for temporary use in connection with drilling and pumping operations on adjacent or nearby tracts, the lessee shall have the option of paying royalties upon such gas wells of the same percentage of the gross proceeds from the sale of gas from such wells as is paid under this lease for royalty on oil. The lessor shall have the free use of gas for domestic purposes in his residence on the leased premises, provided there shall be surplus gas produced on said premises over and above enough to fully operate the same. Failure on the part of the lessee to use a gas producing well, which cannot profitably be utilized at the rate herein prescribed, shall not work a forfeiture of this lease so far as the same relates to mining oil, but if the lessee desires to retain gas producing privileges, the lessee shall pay a rental of one hundred dollars; per annum, in advance, calculated from date of discovery of gas, on each gas producing well, gas from which is not marketed or not utilized otherwise than for operations under this lease. Payments of annual gas royalties shall be made within twenty-five days from the date such royalties become due, other royalty payments to be made monthly on or before the 25th day of the month succeeding that for which such payment is to be made, supported by sworn statements."

    (1) Did the lease expire when production ceased in March 1930, or may it properly be considered as continued in force by existence of wells capable of producing gas which are now shut in?

    (2) What is the annual royalty or rental due from well No. 1, from which gas formerly was sold, while it is not producing?

    (3) What is the annual amount due for well No. 2, from which gas was used only for lease operations, while it is not producing?

    As the habendum clause of the lease provides that after the expiration of the 10-year term (1928) the lease shall remain in effect so long as "oil or
 

gas is found in paying quantities," it is necessary to determine whether or not after March 1930 gas has been found in such quantities within the contemplation of the law.

    There is a well-established rule that where an oil and gas lease is for a definite term and as long thereafter as oil or gas is found (or produced) in paying quantities, the lease terminates after the definite term as soon as the wells cease to yield an operating profit, whether or not such cessation is due to market conditions. Summers, Oil and Gas, Perm. Ed., Vol. 2, sec. 306. However, there is an equally well-established exception to the rule in the case where only dry gas wells have been produced under the lease, where these have had to be shut down because of market conditions but are capable of production, where only a flat sum, is due the lessor for production from a gas well, and where such sum has been paid by the lessee. If these conditions exist, the courts do not permit the lessor to cancel the lease for expiration, abandonment or forfeiture, on the theory that gas cannot be stored above the ground and the lessor is not injured since he receives the same amount as he would if the gas were being produced and sold. Summers, Vol. 2,. sec. 299; Summerville v. Apollo Gas Co., 207 Pa. 334, 56 Atl. 876 (1904); McCutcheon v. Enon Oil Co., 102 W. Va. 345, 135 S.E; 238 (1926); McGraw Oil Co. v. Kennedy; 65 W. Va. 595, 64 S.E. 1027 (1909). Note that the exception fails if the wells have become incapable of production. United States v. Brown, 15 F. (2d) 565 (N.D. Okla. 1926).

    In Smith v. McGill, 12 F. (2d) 32 (C.C.A. 8th, 1926), the court had under consideration an Indian lease the terms of which were identical with this lease. There gas from a gas well brought in during the primary term was sold for about two months thereafter. It was then discovered that the gas was not feeding into the pipe line because of lack of pressure and the lessee began to drill the well to a greater depth. The lessee tendered the lessor $300 as payment for the gas-producing well but the money was refused because the lessor did not consider the well as producing gas in paying quantities. The lessor failed in his effort to have the lease cancelled. I shall quote at length from the opinion in this case because it summarizes the position taken by the courts in construing leases involving gas alone:

    "* * * In the construction of leases of this nature, a distinction has generally been recognized between a covenant by the lessee to pay the lessor an amount proportioned to the oil which is produced, and a covenant to pay the lessor a fixed sum as a periodic rental for a gas well. As to the first-mentioned covenant, due diligence on the part of the lessee to produce and market the oil is usually implied, if not expressed, because the lessor's remuneration for the grant depends upon it. Brewster v. Lanyon Zinc Co., 140 F. 801, 72 C.C.A. 213; Union Gas & Oil Co. v. Adkins (C.C.A.) 278 F. 854. But where the lessor is to receive a fixed sum, in the nature of rental, for a gas well, the lessee is not held to the same degree of diligence in producing and marketing the gas which has been found in paying quantities.

    "Gas can ordinarily be marketed (except for minor uses) only through pipe lines, which often belong to others, and may have to be extended from a distance. Gas cannot profitably be brought to the surface and stored to await a market. Even if gas is marketed through a pipe line, if the pressure from a particular line falls below the pressure in the pipes by gas from other wells, the gas from the weaker well will cease to flow in the pipelines. A temporary cessation of production and marketing of gas may not be unremunerative, because the final disposition of the gas may make the cessation advisable. McKnight v. Manufacturers' Natural Gas Co., 146 Pa. 185, 23 A. 164, 28 Am. St. Rep. 790; Eastern Oil Co. v. Couleham, 65 W. Va. 531, 64 S.E. 836; Transcontinental Oil Co. v. Spencer (C.C.A.) 6 F. (2d) 866.

    "While these problems present difficulties to the lessee, the lessor suffers no loss as to a well in which gas has been found, so long as the rental is paid to him for the gas well. It is therefore the generally accepted rule that, where an oil and gas mining lease provides for the payment to the lessor of a fixed sum, in the nature of rental, for a gas well, and the lease also provides that gas must be found in paying quantities, or in quantities large enough to transport, the question whether the gas, which is found, is in paying quantities, or in quantities large enough to transport, is to be left to the judgment of the lessee, acting in good faith." (Numerous cases cited.)

tion from the Smith v. McGill case and in the following quotations from other cases where the exception to the general rule has been applied or discussed:

    "It is contended on the part of the appellant that the question of whether oil or gas is produced in paying quantities is one solely for the determination of the lessee. There is some force in this contention in so far as it applies to gas wells, where the contract provides that the lessor shall receive a fixed annual rental for each gas well, and the lessee is ready and willing to pay that rental. In such case the landowner receives the same revenue from the operation of his land as he would receive if the gas well were in fact a paying one to the lessee.* * *". (Italics supplied.) (Union Gas and Oil Co. v. Adkins, 278 Fed. 854 (C.C.A. 6th, 1922) at 857.)

    "Upon the discovery thereof in quantities large enough to transport, the plaintiff was entitled to $100 per year for the product of each and every well so transported, and this sum was tendered to her by defendants in accordance with the terms of the lease. The amount of her revenue did not depend upon the amount of gas transported, but was a fixed and definite sum, with the additional privilege of using gas for domestic purposes. So long as she received payment of the $100 per annum and had the use of gas for domestic purposes, she was entitled to claim no other revenue or consideration from lessee on ac count of the well in question." (Roach v. Junction Oil & Gas Co., 72 Okla. 213, 179 Pac. (1919) at 936.)

"It may be that for some time the lessee was not able to find a purchaser for the gas, but that was not the affair of the lessors. They were not interested in the proceeds of the sale of the gas. Their rights under the agreement extended only to the receipt of a stipulated annual rental for each well, and the free use of gas for domestic purposes. Beyond this, the question of whether or not the quantity of gas was profitable was for the decision of the lessee. It may be that the final disposition of the product of the well was such as to amply remunerate it for the delay in finding a market." (Summerville v. Apollo Gas Co., 207 Pa. 334, 56 Atl. 876 (1904) at 878.)

    "* * * What right has Evans [the lessor] to say that no estate vested by reason of insufficiency of gas, when the lease makes no such provision, and the lessee chooses to regard it as sufficient and pay as if it were? * * * He gets the same pay as if the well produced a larger quantity. * * *" (McGraw Oil Co. v. Kennedy, 65 W. Va. 595, 64 S.E. 1027 (1909) at 1028.)

    "* * * However, the lease does not in terms say the well must produce gas in 'paying quantities' and be marketed. Having no market, the lessee had the right to shut the gas in and pay the stipulated price. It would be of little concern to lessor what was done with the gas, if he gets his payments. * * *" (McCutcheon v. Enon Oil Co., 102 W. Va. 345, 135 S.E. 238 (1926) at 241.)

    "* * * In this connection regard must be had to the distinction between gas and oil wells. This distinction lies in the nature of the product and the provisions of the lease: First, oil may be stored in tanks, while gas can be stored only in the stratum where found; and second, a lessor's income from oil is a share of the oil produced, while the income from gas, except under recent leases, is based, as here, on a flat royalty for each well. 2 Summers, Oil and Gas, Perm. Ed., sec. 299, pp. 140, 141. * * *" (Ketchum v. Chartiers Oil Co., 121 W. Va. 503, 5 S.E. (2d) 414 (1939) at 416.) (Emphasis supplied.)

    My conclusion is borne out by the distinction in this particular lease between the terms "royalty" and "rental." The lease provides that the $300 payment is a royalty payment and the $100 is a rental payment. Technically, royalty is the return for minerals produced, and rental is the payment for the privilege of boring for oil or gas or for
 

permitting delay .in development. See Dixon v. Mapes, 181 Okla. 376, 73 P. (2d) 1131 (1937). If the lease in this case is to be considered still alive on the basis that gas is being produced in paying quantities, the royalty for gas production should be paid for at least one well. If only the rental for the privilege of boring for gas or delayed development were paid, it would be a clear admission that no gas was being produced and that the lease should terminate. In the opinion approved by you on April 19, 1934, 54 I.D. 422, the lease owned by the Deep Rock Oil Corporation there considered was identical with the lease in question. It was there held that the tender only of the rental sum of $100 per annum was an admission in effect that the lease was not producing gas in paying quantities and, therefore, that the lease should be found to have expired as of the date the lessee failed to continue production in paying quantities.

    The question immediately occurs whether it was necessary for the lessee to pay the $300 annual royalty on gas well No. 2 in order to keep the lease in effect as to that well or as to the rest of the lease. My answer is that a consideration of the terms of the lease as a whole and of the law on the subject shows that it was necessary for the lessee to pay the $300 annual royalty only on one gas producing well developed under the lease in order to keep the lease in existence over the whole area covered by the lease. It is clear from the terms of the lease that one producing gas well is all that is necessary to continue the life of the lease after the definite term. Section 4 gives the lessee 10 years to produce one well, and requires that payment of delay rentals each. year until one well has been developed. This indicates that if at the end of 10 years there is one gas well producing in paying quantities (or being paid for on that basis because of the lack of a market) the entire lease remains in effect.

    While it is possible for a lease to be forfeited as to a portion of the acreage covered, this result has ordinarily occurred only for the reason that an abandonment of forfeiture was found in a failure to drill wells in an undeveloped portion of the lease where prudent operation or the protection of the lessor would require it. See for example Sauder v. Mid-Continent Petroleum Corp., 292 U.S. 272; Scott v. Price, 123 Okla. 172, 247 Pac. 103 (1926). But with respect to the present oil and gas lease, the question has not been presented to this office whether the lessee should be required to undertake any further initial production operations; nor can there be any question of abandonment by the lessee on the facts presented, since the failure to market gas because of market conditions is not an abandonment of the lease or of any of the gas wells. Strange v. Hicks. 78 Okla. 1, 188 Pac. 347 (1920). In The single case found, brought for the cancellation of on area under lease on which there was a shut-in gas well, at one time a producing well, there is the flat holding that there can be no cancellation of the lease by the lessor so long as any part of the development under the lease is producing in paying quantities, because the lease must be treated as a unit. Pearson v. Black, 120 S.W. (2d) 1075 (Tex. Civ. App. 1938). This holding was made in spite of the fact that the area sought to be cancelled was under a separate assignment and the entire lease embraced the large area of over 10,000 acres.

    However, any question of partial cancellation is answered sufficiently by the express language of the lease which provides in effect for forfeiture of the gas rights to unprofitable wells unless gas producing privileges are retained by the lessee through the payment of a $100 annual rental. This provision, contained in the terms relating to payment for gas wells, recited at the outset of this opinion, reads as follows:

    "* * * Failure on the part of the lessee to use a gas producing well, which cannot profitably be utilized at the rate herein prescribed, shall not work a forfeiture of this lease so far as the same relates to mining oil, but if the lessee desires to retain gas producing privileges, the lessee shall pay a rental of one hundred dollars per annum, in. advance, calculated from date of discovery of gas, on each gas producing well, gas from which is not marketed or not utilized otherwise than for operations under this lease."

    In summary, the answers reached in this opinion to the three questions raised by you are (1) that the lease may be considered as continued in force since production ceased in March 1930 by reason of the existence of wells capable of producing gas, but shut in because of market conditions, and by reason of payment by the lessee of an annual royalty since that date of $300 on gas well No. 1; (2) that the annual payment due for well No. 1
 

is the $300 annual royalty paid by the lessee; and (3) that the annual payment due for well No. 2 is the $100 annual rental which the lessee has paid for that well.

                                                                                                                                            NATHAN R. MARGOLD,

 Approved: February 13, 1942.
OSCAR L. CHAPMAN, Assistant Secretary.

M-31634                                                                                                                                             February 13, 1942.

Re:

Fishing rights of Alaskan Indians.

1. Aboriginal occupancy of particular areas of water or submerged land creates legal rights which, unless they have been extinguished, the Department is bound to recognize.

2. Such rights were not extinguished by Russian sovereignty or action taken thereunder.

3. Such rights have not been extinguished by the sovereignty of the United States or by any treaty, act of Congress, or administrative action thereunder.

4. With respect to areas which may be shown to have been subject to aboriginal occupancy, regulations permitting control by non-Indians would be unauthorized and illegal.

MY DEAR MR. SECRETARY:

    My opinion has been invited on the question:

    "Whether Indians of Alaska have any fishing rights which are violated by control of particular trap sites by. non-Indians under departmental regulations, and whether such rights require or justify the closing down of certain trap sites or the allocation of trap sites to Indian groups or other remedial action by the Secretary of the Interior."

    The principles governing the recognition of aboriginal occupancy rights are clearly set forth in the opinion of the Supreme Court recently delivered in the Walapai case (The United States of America, as Guardian of the Indians of the Tribe of Hualpai in the State of Arizona v. Santa Fe Pacific Railroad Company, decided December 8, 1941). In this opinion the Supreme Court made it clear (a) that aboriginal occupancy establishes rights of possession; (b) that this policy extends to "land under the prior sovereignty of the various European nations"; (c) that a tribal right of occupancy need not be based upon a treaty, statute, or other formal Government action; and (d) that extinguishment of tribal occupancy rights may not be inferred from general legislation that does not refer specifically to Indian rights or from administrative action taken under such legislation, even though such administrative action may in fact interfere with the full enjoyment of such possessory rights. Each of these principles is relevant to the claimed Indian occupancy rights in Alaskan waters and submerged land.

    Under the foregoing principles, the first, question that arises is whether the use of waters or submerged lands by Alaskan natives was of such a character that it can be considered a continuous occupancy, in the same sense that use of uplands by an Indian tribe for agriculture, hunting, or seed-gathering, to the exclusion of other tribes, is considered as occupancy in the Walapai case and numerous other cases therein cited.

    Without attempting at this time to mark out the locality and extent of particular Indian claims, we may note that available information shows that the Indians clearly recognized, inter se, private and exclusive rights to take fish in designated waters. A memorandum submitted by Mr. Paul W. Gordon, then Director of Education for Alaska, approved by the Commissioner of Indian Affairs on June 3, 1934, describes the Indian concept of fishing rights in the following terms:

    "But perhaps even more important, since their life was based largely on the salmon catch, the natives of southeastern Alaska had a well defined recognition of the rights of individuals ,and families to the use of certain streams, channels and ocean areas for fish taking. These locations were honored just as faithfully as if the sites were patented and recorded with a clerk of records. This system may be seen still operating on the Kuskokwim where without recourse to written records but

with great fidelity to the dictates of custom, enforced by unwritten community decrees fish net locations are considered as belonging to a certain person, subject to disposal by deed or testament."

    "* * * The practical admission of the European conquerors of this country renders it unnecessary for us to speculate on the extent of that right which they might have asserted from conquest and from the migratory habits and hunter state of its aboriginal occupants. (See the authorities cited in Fletcher and Peck, 6 Cranch. 121.) The conquerors have never claimed more than the exclusive right of purchase from the Indians, and the right of succession to a tribe which shall have removed voluntarily, or become extinguished by death. So long as a tribe exists and remains in possession of its lands, its title and possession are sovereign and exclusive; and there exists no authority to enter upon their lands, for any purpose whatever, without their consent. * * * Although the Indian title continues only during their possession, yet that possession has been always held sacred, and can never be disturbed but by their consent. They do not hold under the States, nor under the United States; their title is original, sovereign, and exclusive." (At pp. 466-467.)

    We must consider, therefore, in the second place, whether Russian sovereignty or any action taken thereunder extinguished the original possessory rights of the Indians in Alaskan waters and submerged lands. That Russian sovereignty had no such effect is clear from the fact that Russia, with other European nations, accepted the principles of international law recognizing prior possessory rights in conquered or discovered territory.² There is no record of any attempt by the Russian Government to abolish Indian fishing rights. In fact, meager historical evidence that is available indicates that the Russians recognized Indian fishing rights and encouraged the exercise thereof. Thus, the second chapter of the Russian American Company, issued on September 4, 1821, contains the following provisions:

    "Sec. 42. The peoples inhabiting places governed by the company are: Islander, Kuriles, Aleutians and others and also the tribes living along the coast of America, such as Kenais, Chugach, and others.

    "Sec. 43. These peoples are considered by the government equally with all other Russian subjects. They constitute a separate estate while they are living in the Colonies and through excellent merit or other occasions do not pass into a different estate.

    "Sec. 44. In this standing of Russian subjects they are subject to obedience, to general state law, and have their protection.

    "Sec. 50. Everything acquired by an Islander either through his own labor or inherited or purchased or bartered is his inalienable property and anybody attempting to take it away from him or to cause him personal insult will be prosecuted to the full extent of the law.

    "Sec. 56. The Islanders not in the service of the Company may, for their own and their families' food, fish along the shores which they inhabit, but not to absent themselves to the neighboring shores without special permission from the Company * * *.

    "Sec. 57. The Company * * * shall not extend their searches * * * to the interior of those Countries * * * and shall by no means meddle with oppression of the inhabitants, living along those coasts; and in case the Company should think it for their interest, to establish factories in some places of the American Continent in order to secure their com-

  ²See Wharton, A Treatise on the Conflict of Laws or Private International Law, 3d ed.. 1905, vol. 1, sec. 9; Wheaton, Elements of International Law, 5th ed., by Phillipson (1916); pp. 66-68; Alaska Boundary Tribunal, Appendix, vol. 11. p. 23; Wall v. Williamson, 8 Ala. 48, 51 (1845). And see other authorities cited in Cohen, Handbook of Federal Indian Law, Chap. 7, sec. 2, and Chap. 15, secs. 4 and 9.
 

merce, they may do so after having acquired the consent of the Natives and shall do every thing in their power to maintain their arrangements and avoid everything that might create the suspicion or thought as if they intended to deprive them of their independence.

    "Sec. 58. The Company is prohibited to demand gifts, dues, tribute or any such sacrifices from these people, equally during the time of peace * * *." ³

    In the first place, it must be recognized that the mere fact that the common law does not recognize several rights of fishery in ocean waters or rights in land below the high water mark does not mean that such rights were abolished by the extension of American sovereignty over the waters in question. It is well settled that Indian legal relations, established by tribal laws or customs antedating American sovereignty, are unaffected by the common law. As was well said in Ex parte Tiger, 2 Ind.
T. 41, 47. S.W. 304, (1898):

"* * * If the Creek Nation derived its system of jurisprudence through the common law, there would be much plausibility in this reasoning. But they are strangers to the common law. They derive their jurisprudence from an entirely different source, and they are as unfamiliar with common-law terms and definitions as they are with Sanskrit or Hebrew." (At p. 305)

    "The law of real property is to be found in the law of the situs. The law of real property in the Cherokee country therefore is to be found in the constitution and laws of the Cherokee Nation." (At p. 251.)

    With this system of land law before us, it is unreasonable that this agreement was intended to be in derogation of the system and contrary to the usages of occupants throughout the entire Indian country from the Atlantic to the Pacific. At the time the agreement was entered into the citizens of the Cherokee Nation held no other right or interest in the land than the right of occupancy as communal owners. The common law did not prevail in the Cherokee country, and an estate in fee simple absolute was a thing utterly unknown. * * * The agreement must be construed with reference to the constitution and laws of the Cherokee Nation." (At p. 253.)

    The specific question of aboriginal fishing rights was before the Supreme Court in Damon v. Hawaii, 194 U.S. 154 (1904), where Mr. Justice Holmes, in upholding the validity of such rights wrote, on behalf of a unanimous Court:

    "This is an action at law, somewhat like a bill to quiet title, to establish the plaintiff's right to a several fishery of a peculiar sort, between the coral reef and the ahupuaa of Moanalua on the main land of the Island of Oahu. The organic act of the Territory of Hawaii repealed all laws of the Republic of Hawaii which conferred exclusive fishing rights, subject, however, to vested rights, and it required actions to be started within two years by those who claimed such rights. Act of April 30, 1900, c. 339, § § 95, 96; 31 Stat. 141, 160.

At the trial the presiding judge directed a verdict for the defendant. Exceptions were taken but were overruled by the Supreme Court of the Territory, and the case comes here by writ of error.

    "The right claimed is a right within certain metes and bounds to set apart one species of fish to the owner's sole use, or, alternatively, to put a taboo on all fishing within the limits for certain months and to receive from all fishermen one-third of the fish taken upon the fishing grounds. A right of this sort is some what different from those familiar to the common law, but it seems to be well known to Hawaii, and, if it is established, there is no more theoretical difficulty in regarding it as property and a vested right than there is regarding any ordinary easement or profit a prende as such. The plaintiff's claim is not to be approached as if it were something anomalous or monstrous, difficult to conceive and more difficult to admit." (pp. 157, 158).

    "* * * We assume that a mere grant of the ahupuaa without mention of the fishery would not convey the fishery. But it does not follow that any particular words are necessary to convey it when the intent is clear. * * * There is no technical rule which overrides the expressed intent, like that of the common law, which requires the mention of heirs in order to convey a fee." (p. 161)

    "* * * They (the plaintiffs) offered evidence at the trial that, before the action of the king in 1839, those under whom the plaintiffs claim title had enjoyed from time immemorial rights similar to those set out in the statutes, and also that they had been in continuous, exclusive and notorious possession of the konohiki right for sixty years. They offered in short to prove that their predecessor in title was within the statutes and therefore owned the fishery, it not being disputed that if he did, the plaintiffs own it now. The judge rejected the evidence and entered judgment for the defendant, and on exceptions this judgment and that in Damon v. Hawaii were sustained at the same time in one opinion by the Supreme Court. 14 Hawaiian, 465.

    "We deem it unnecessary to repeat the ground of our intimation in the former case, that the statutes there referred to created vested rights. We simply repeat that in our opinion such was their effect. The fact that they neither identified the specific grantees nor established the boundaries, is immaterial when their purport as a grant or confirmation is decided. It is enough that they afforded the means of identification, and that presumably the boundaries can be fixed by references to existing facts; or the application of principles which have been laid down in cases of more or less similar kind.

    "The omission of the plaintiffs' predecessor in title to establish his right to the fishery before the Land Commission does not prejudice their case. See Kenoa v. Meek, 6 Hawaiian, 63. That commission was established to determine the title to lands as against the Hawaiian Government. In practice it treated the fisheries as not within its jurisdiction, and it would seem to have been right in its view. See Akeni v. Wong Ka Mau, 5 Hawaiian, 91." (pp. 256, 257)

    Thus no extinguished or impairment of pre-existing Indian possessory rights in waters or submerged lands can be deduced from the nature of the common law, any more than from the fact of United States sovereignty. If such prior rights have been abolished or impaired, this can only have taken place by virtue of some clear and unmistakable provision of a treaty or act of Congress. No treaty or act of Congress containing any such provisions can be found.

    There is, to be sure, legislation that limits the exercise of Indian, as well as non-Indian, fishing rights in terms of conservation principles, and it is not within the scope of the inquiry presented to
 

me to question the validity of such legislation. This legislation, however, does not prevent the recognition of prior existing rights in waters or submerged land, even though such rights be private rights which could not, under the Federal statutes, be newly created by the Secretary of the Interior.

    The general scheme of Federal control over Alaskan fishing is embodied in the act of June 6, 1924 (43 Stat. 464), as amended (U.S.C. tit. 48, secs. 221-228). Under this legislation administrative control of Alaskan fishing, for conservation purposes, is vested in the Secretary of the Interior. The scope of his authority is defined in the first two sections of the statute, which declare:

"Section 22I. Fishing areas; closed season; limitation on fishing.

    "For the purpose of protecting and conserving the fisheries of the United States in all waters of Alaska the Secretary of the Interior from time to time may set apart and reserve fishing areas in any of the waters of Alaska over which the United States has jurisdiction, and within such areas may establish closed seasons during which fishing may be limited or prohibited as he may prescribe. Under this authority to limit fishing in any, area so set apart and reserved the Secretary may (a) fix the size and character of nets, boats, traps, or other gear and appliances to be used therein; (b) limit the catch of fish to be taken from any area; (c) make such regulations as to time, means, methods, and extent of fishing as he may deem advisable. (June 6, 1924, ch. 272, sec. 1, 43 Stat. 464; June 18; 1926, ch. 621, 44 Stat. 752; Reorg. Plan No. II, set 4 (e), eff. July 1, 1939, 4 Fed. Reg. 2731, 55 Stat. 1433.)

"Section 222. Unlawful fishing in areas; no exclusive rights to be granted; citizens.

    "From and after the creation of any such fishing area and during the time fishing is prohibited therein it shall be unlawful to fish therein or to operate therein any boat, seine, trap, or other gear or apparatus for the purpose of taking fish; and from and after the creation of any such fishing area in which limited fishing is permitted such fishing shall be carried on only during the time, in the manner, to the extent, and in conformity with such rules and regulations as the Secretary prescribes under the authority herein given: Provided, That every such regulation made by the Secretary of the Interior shall be of general application within the particular area to which it applies, and that no exclusive or several right of fishery shall be granted therein, nor shall any citizen of the United States be denied the right to take, prepare, cure, or preserve fish or shellfish in any area of the waters of Alaska where fishing is permitted by the Secretary of the Interior. (June 6, 1924, ch. 272, sec. 1, 43 Stat. 464; June 18, 1926, ch. 621, 44 Stat. 752; Reorg. Plan No. II, sec. 4 (e), eff. July 1, 1939, 4 Fed. Reg. 2731, 53 Stat. 1433.)"

    It is true that the proviso of section 222 prohibits any grant of any exclusive right of fishery, but this clearly refers to grants under the statute and not to rights existing long prior to the statute.

    A more serious question, however, is raised by the final clause of this proviso, which declares that "in any area of the waters of Alaska where fishing is permitted by the Secretary of the Interior" no citizen of the United States shall "be denied the right to take * * * fish." It may be argued that this is not merely a limitation upon the regulatory powers of the Secretary, but a positive grant of equal rights to all citizens which, being inconsistent with the existence of any special Indian possessory rights, necessarily effects extinguishment of such special Indian rights.

    Such a conclusion would raise a serious question of constitutionality, for it has often been held that extinguishment of Indian possessory rights, without the consent of or compensation to the Indians
 

affected, is forbidden by the Fifth Amendment. Choate v. Trapp, 224 U.S. 665 (1912); Lane v. Pueblo of Santa Rosa, 249 U.S. 110 (1919); United States v. Creek Nation, 295 U.S. 103 (1938); Shoshone Tribe v. United States, 299 U.S. 476 (1937). On this issue, the Supreme Court, per Mr. Justice Van Devanter, recently declared:

"Our decisions, while recognizing that the government has power to control and manage the property and affairs of its Indian wards in good faith for their welfare, show that this power is subject to constitutional limitations and does not enable the government to give the lands of one tribe or band to another, or to deal with them as its own." (Chippewa Indians v. United States, 301 U.S. 358, 375-376 (1937).)

    In the opinion last cited, Attorney General (now Chief Justice) Stone, in holding a mineral leasing law inapplicable to lands subject to Indian occupancy rights, declared:

    "The long settled rule of construction is that general laws providing for the disposition of public lands or the public domain do not apply to lands which have been set aside or reserved for particular public uses, unless the contrary clearly appears from the context or the circumstances attending the legislation. * * * Concerning Indian reservations, Indian lands, and Indian affairs generally, Congress habitually acts only by legislation expressly and specifically applicable thereto." (at p. 172.)

    "Certainly it would take plain and unambiguous action to deprive the Walapais of the benefits of that policy."

    I note, then; that even if areas subject to Indian possessory rights were to be designated for the application of conservation regulations issued by the Secretary of the Interior, this would not impair any Indian possessory rights that were in existence prior to 1924, and that such rights might be appropriately safeguarded by regulation. If, however, I am mistaken in this observation, and if the mere extension of such regulations to areas subject to Indian possessory rights would interfere with those rights, it does not follow that the rights in question have been abrogated. Rather it would be necessary to conclude that if application of conservation controls to an area would automatically wipe out vested rights therein, then, since the Secretary of the Interior has no right to use otherwise discretionary powers in such a way as to effect a confiscation of Indian possessions
(Lane v. Pueblo of Santa Rosa; supra), he would have no right to extend the application of those controls to any areas subject to Indian possessory rights. If the Secretary of the Interior has no authority over such areas, they certainly cannot be called areas where "fishing is permitted by the Secretary of the Interior," and it cannot then be argued with any show of reason that the proviso in question has any application at all to, or any effect upon, Indian possessions.

    Therefore, whatever construction be put upon the final proviso of section 222, the conclusion is inevitable that the proviso does not extinguish Indian possessory rights in waters or submerged land that were valid before 1924.

    Apart from this legislation, the validity of such aboriginal possessory rights is not put into question by any other federal statute affecting Alaska. A number of federal statutes provide that Indian possessions in Alaska shall be respected (act of May 17, 1884, sec. 8, 23 Stat. 24; act of June 6, 1900, sec. 27, 31 Stat. 321, 330) or shall not be adversely affected by various provisions for the disposition of the public domain. (Act of March 3, 1891, 26 Stat. 1095, 1100; act of May 14, 1898,
sec. 10, 30 Stat. 409, 413.)

    These and other related statutes have been liberally construed by the Department and by the courts for the protection of native rights of occupancy.⁴ Conceivably, the term "land" in these statutes might be narrowly constructed as referring only to land above water, but although this narrow construction has been several times presented, it

___________
  ⁴ 26 L.D. 512 (1898); 26 L.D. 427 (1899); 28 L.D. 535 (1899).
 

has been in each instance flatly rejected. The statutes in question have been consistently interpreted as protecting Indian occupancy not only of lands above water but also of land under natural waterways or ditches,⁵ of tide-lands, and of waters adjacent to occupied shores.⁶ The case of Heckman v. Sutter, 119 Fed. 83 (C.C.A. 9, 1902), aff'g Sutter v. Heckman, 1 Alaska 188, presented the question of whether parties claiming lands and waters by virtue of transfer from an aboriginal occupant were entitled to enjoin other private parties from fishing in waters adjacent to the shore. The Federal District Court for Alaska issued such an injunction. The court, with reference to the common right of fishery, said:

    "It may be conceded, for the purpose of this case, that in all navigable waters and arms of the sea in Alaska, and in all rivers where not forbidden by law, the right of navigating said waters and fishing therein is a common one to all the citizens of Alaska, and that no one, other perhaps than the natives, can acquire any exclusive right, either in navigating said waters or fishing therein.* * *"

    "* * * It is believed that the principle which gives the littoral owner the right of way and the right to construct a wharf in front of his upland across the tide flats to the deep water may be also as clearly and reasonably applied to a right of way that shall permit the littoral owner to exercise certain possessory rights as a right of way to the deep water of the sea over the tide flats, and that he may acquire certain possessory rights in such right of way by cleaning away the debris and material deposited thereon, and making it a clear and proper roadway from the deep water to the upland, over which he may pass and repass with his nets in the act of fishing, unobstructed and uninterrupted by the acts or appliances of those who have a common right to fish in the waters of the sea and the rivers of Alaska."

    "The prohibition contained in the act of 1884 against the disturbance of the use of possession of any Indian or other person of any land in Alaska claimed by them is sufficiently general and comprehensive to include tide lands as well as lands above high-water mark. Nor is it surprising that congress, in first dealing with the then sparsely settled country, was disposed to protect its few inhabitants in the possession of lands, of whatever character, by means of which they eked out their hard and precarious existence. The fact that at that time the Indians and other occupants of the country largely made their living by fishing was no doubt well known to the legislative branch of the government, as well as the fact that that business, if conducted on any substantial scale, necessitated the use of parts of the tide flats in the putting out and hauling in of the necessary seines. Congress saw proper by its act of 1884 the possession and use by these Indians and other persons of any and all land in Alaska against intrusion by third persons, and so far has never deemed it wise to otherwise provide. That legislation was sufficient authority, in our opinion, for the decree of the court below securing the complainants in the use and possession of land which the evidence shows and the court found was held and maintained at the time of their disturbance therein by the defendants, and for years theretofore had been so held and maintained." (Pp. 88-89.)

    "The fish-trap was erected in 1916 without the consent of the Indians or the Secretary of the Interior. It is a formidable structure consisting of heavy piling and wire webbing, is located in water of considerable depth, approximately 600 feet from the high tide line of the island on which the Indians settled, is

    ⁶ 49 &.D. 592 (1925).
 

intended to catch about 600,000 salmon in a single season, and its operation will tend materially to reduce the natural supply of fish accessible to the Indians.

    "The principal question for decision is whether the reservation created by the Act of 1891 embraces only the upland of the islands or includes as well as the adjacent waters and submerged land. The question is one of construction-of determining what Congress intended by the words 'the body of lands known as Annette Islands.'

                        *                                *                                *                                *                                *

    "* * * The Indians could not sustain themselves from the use of the upland alone. The use of the adjacent fishing grounds was equally essential. Without this the colony could not prosper in that location. The Indians naturally looked on the fishing grounds as part of the islands and proceeded on that theory in soliciting the reservation. They had done much for themselves and were striving to do more. Evidently Congress intended to conform its action to their situation and needs."

    "The right to resort to the fishing places in controversy was a part of larger rights possessed by the Indians, upon the exercise of which there was not a shadow of impediment, and which were not much less necessary to the existence of the Indians than the atmosphere they breathed. New conditions came into existence, to which those rights had to be accommodated. Only a limitation of them, however, was necessary and intended, not a taking away. In other words, the treaty was not a grant of rights to the Indians, but a grant of rights from them-a reservation of those not granted." (At p. 381.)

    "If this method and ruling is applied to the instant question it would follow that section 2 of the 1936 Alaska Act may likewise be construed as intending to allow the reservation of fishing rights essential to the reservation created under that act. It is the same power of Congress that is being exercised. The purposes of this act are identical with those which surrounded the act reserving the Annette Islands Reservation and are hereby plainly expressed in the statute. The act recites the title of the Indian Reorganization Act (48 Stat. 984), June 18, 1934, which states as its purposes 'to conserve and develop Indian lands and resources; to extend to Indians the right to form business and other organization; to establish a credit system for Indians * * *.' It is well known, as is recited in the opinions of the Supreme Court and the Circuit Court of Appeals concerning the Metlakahtla Indians, that the natives of Alaska are not naturally agricultural and depend chiefly on fishing and hunting for their livelihood. The fish of the Alaska coast region is one of their major resources and therefore appropriate to be conserved under the Reorganization Act in connection with their reservations. Moreover, a large number of the organizations developed under the Reorganization Act, particularly in southeast Alaska, will be fisheries and fish canneries. It will be these fish enterprises, similar to the successful enterprise developed by the Indians of the Annette Islands, which will be major users of the credit system established under the Reorganization Act. The Alaska Reorganization Act provides chat the Indians may be organized, not as bands or tribes, but as groups having 'a common bond of occupation.' One of the most usual bonds of occupation is that of fishing and it is certain that many of the communities organized under the Reorganization Act will be fishing communities. The economic purpose of this legislation extending the Reorganization Act to Alaska was made clear in the report by the Interior Department to Congress on this act when it was introduced. The report stated that since the original Indian Reorganization Act did not extend the right of incorporation

and enjoyment of credit privileges to Alaska, the Alaska Act was designed to remedy this omission. From these facts it is evident that the purpose of the Alaska Act would be seriously frustrated if the reservations designated under it could not embrace the major resource of many of the Indian organizations.

    "The express language of section 2 of the Alaska Act is not materially more confining in its application than that which was used in the act reserving the Annette Islands Reservation. Instead of the words 'body of lands' the words are used, 'any area of land' and 'additional public lands adjacent thereto * * * or any other public lands which are actually occupied by Indians or Eskimos.' The term 'public lands' is synonymous with. the term 'public domain,' and the tidewaters of the territories of the United States and the lands under them have been classified as part of the public domain since they belong exclusively to the United States Government and are subject to its disposition. Shively v. Bowlby, 152 U.S: 1; Alaska Pacific Fisheries v. United States, 248, U.S. at 87; 240 Fed. at 281, 282.* * *"

    This national policy finds embodiment in the act of June 19, 1935 (49 Stat. 388), authorizing suit against the United States by the Tlingit and Haida Indians of Alaska. These are the Indians inhabiting the southeast coast of Alaska and most directly interested in the question considered in this opinion. It is reported that their chief interest in the jurisdictional act in question arises from interferences with fishing rights.⁷ The language of the jurisdictional act. is very broad. Its substantive provisions are contained in section 2, which declares:

    "All claims of whatever nature, legal or equitable, which the said Tlingit and Haida Indians of Alaska may have, or claim to have, against the United States, for lands or other tribal or community property rights, taken from them by the United States without compensation therefore, or for the failure or refusal of the United States to compensate them for said lands or other tribal or community property rights, claimed to be owned by said Indians, and which the United States appropriated to its own uses and purposes without the consent of said Indians, or for the failure or refusal of the United States to protect their interests in lands or other tribal or community property in Alaska, and for loss of use of the same, at the time of the purchase of the said Russian America, now Alaska, from Russia, or at any time since that date and prior to the passage and approval of this Act, shall be submitted to the said Court of Claims by said Tlingit and Haida Indians of Alaska for the settlement and determination of the equitable and just value thereof, and the amount equitably and justly due to said Indians from the United States therefore; and the loss to said Indians of their right, title; or interest, arising from occupancy and use, in lands or other tribal or community property, without just compensation therefore; shall beheld sufficient ground for relief hereunder, and jurisdiction is hereby conferred upon said Court to hear such claims and to render judgment and decree thereon for such sum as said court shall find to be equitable and just for the reasonable value of their said property, if any was so taken by the United States without the consent of the said Indians and without compensation therefore; that from the decision of the Court of Claims in any suit or suits prosecuted under the authority of this Act an appeal may be taken by either party, as in other cases, to the Supreme Court of the United States." (Italics supplied.)

    The national policy expressed in the foregoing

____________
   ⁷ See unpublished manuscript of William L. Paul, Jr., "Historical and Legal Materials Relative to the Tlingit and Haida Claims Act of 1935."
 

statutes is not negated by the fact that in its administration of the 1924 Alaska fishing law the Department of Commerce for many years, and the Department of the Interior since July 1, 1939, have given no special recognition to Indian rights, although Indians have frequently protested against their displacement from waters that have been an ancestral source of food and livelihood. It may be that the Indians, in the assertion of their claims, have not had adequate legal representation, and it may be that. the departments concerned have not made effective provision for the formal presentation and consideration of such claims, but as a matter of law even if such claims had heretofore been fully considered and formally rejected such action would not be legally effective to destroy any Indian possessory rights. The Supreme Court in the Walapai case, rejecting the argument of the railroad that the Government had administratively recognized the right of the railroad and the absence of Indian right, declared:

    "Such statements by the Secretary of the Interior as that 'title to the odd-numbered sections' was in the respondent do not estop the United States from maintaining this suit. For they could not deprive the Indians of their rights any more than could the unauthorized leases in Cramer v. United States, supra."

    "It is a fact that State governments and administrative officials have frequently trespassed upon the realm of tribal autonomy, presuming to govern the Indian tribes through State law or departmental regulation or arbitrary administrative fiat, but these trespasses have not impaired the vested legal powers of local self-government which have been recognized again and again when these trespasses have been challenged by an Indian tribe. 'Power and authority rightfully conferred do not necessarily cease to exist in consequence of long nonuser.' (United States ex rel. Standing Bear v. Crook, 5 Dill. 453, 460.) The Wheeler-Howard Act, by affording statutory recognition of these powers of local self-government and administrative assistance in developing adequate mechanisms for such government, may reasonably be expected to end the conditions that have in the past led the Interior Department and various State agencies to deal with matters that are properly within the legal competence of the Indian tribes themselves.

___________
   ⁸ Alaska Pacific Fisheries v. United States, 248 U.S. 76 (1918), aff'g. 240 Fed. 274; Territory of Alaska v. Annette Island Packing Co., 289 Fed. 671 (C.C.A. 8th, 1923), cert. denied 263 U.S. 708; 49 L.D. 592 (1923; 28 L.D. 535 (1899). "The extension of the Wheeler-Howard Act to Alaska has removed almost the last significant difference between the position of the American Indian and that of the Alaskan native." Cohen, Handbook of Federal Indian Law (1940) 406.

   ⁹ See Cohen, Handbook of Federal Indian Law, 413-415.

   ¹⁰ The fact that one has occupied the site the season before or for a number of seasons gives no prescriptive right to the site. Thlinket Packing Co. v. Harris & Co., 5 Alaska 471 (1916); Columbia Salmon Co. v. Berg, 5 Alaska 538 (1916); Alitak Packing Co. v. Alaska Packers Ass'n, 6 Alaska 277 (1920); Alaska General Fisheries v. Smith, 7 Alaska 635 (1927).

    It is true that the Secretary of War, under section 10 of the Rivers and Harbors Act of March 3, 1899 (30 Stat. 1121, 1151), issues permits which certify that the erection of a fish trap at the point named will not interfere with navigation. These permits give no property right, and the War Department makes no determination between several applicants as to their right to occupy the trap site. The Territory of Alaska issues licenses to take fish from Alaskan waters, but these licenses confer no property right and no determination is made between applicants as to the right to occupy a trap site. Thlinket Packing Co. v. Harris & Co., supra; Columbia Salmon Co. v. Berg, supra; Alitak Packing Co. v. Alaska Packers Ass'n, supra; Alaska General Fisheries v. Smith, supra; Cummins v. Chicago, 188 U.S. 410 (1903).
 

    I conclude that aboriginal occupancy establishes possessory rights in Alaskan waters and submerged lands, and that such rights have not been extinguished by any treaty, statute, or administrative action.

    The foregoing considerations are determinative of the question presented for my opinion. The first part of this question, i.e., whether Indians of Alaska have any fishing rights which are violated by control of particular trap sites by non-Indians under departmental regulations, must be answered in the affirmative, subject to the taking of proof on the facts respecting the location and extent of such rights. The second hart of the question presented, i.e., whether such rights require or justify the closing down of certain trap sites or the allocation of trap sites to Indian groups or other remedial action by the Secretary of the Interior, must likewise be answered in the affirmative, and the question of what particular method of redress should be selected must be considered primarily a matter of policy.

    Available evidence indicates that the possessory rights traditionally asserted by Alaskan natives are exclusive rights, under which the right to exclude others from a given area is an integral part of the right itself. In this situation the Interior Department would have no authority to open up to public fishing any areas subject to such possessory rights, any more than it could open to the public a private cannery, whether on land or afloat.

    There may, however, be certain native groups that assert and show only non-exclusive rights. These would still be property rights, as easements are property rights, and entitled to protection and respect. The opening up of such areas to non-Indian holders under circumstances resulting in the actual exclusion of the interested Indians would be, this Department has heretofore held, a violation of these native property rights, beyond the legal powers of the Department. 26 L.D. 512 (1898). Regulations heretofore issued, which allow the first comer to set up a trap in designated areas and thereafter provide that no other person may trap fish within a specified distance (e.g., 50 C.F.R. 205.10), do result in the actual exclusion of interested Indians, if applied to areas of water or submerged land in which such Indians have private rights.¹¹ Therefore the allowance of fish trap sites to non-Indians within such areas would be legally unauthorized.

    Under these circumstances the Department might either forbid the establishment of fish traps except by persons having possessory rights in such areas, or forbid the establishment of any fish traps at all therein, or, as a final alternative, exclude such areas entirely from the domain of departmental control. In no event would there be occasion for a positive allocation by the Department of fish trap sites to Indians, but the effect of recognizing pre-existing Indian possessory rights in waters or submerged land would be to render "allocation" unnecessary for the protection of those rights. All that would be necessary would be the exclusion of private parties attempting to interfere with the enjoyment by the Indians of the rights to which they may lay just claim.

    The foregoing considerations determine the validity and character of Indian possessory rights in Alaskan waters and submerged lands. The question of the localities in which such rights exist is one fact which this opinion does not purport to foreclose.

                                                                                                                                            NATHAN R. MARGOLD,

Approved: February 13, 1942.
HAROLD L. ICKES, Secretary of the Interior.

M-31582                                                                                                                                                  March 19, 1942.

Re:

Whether any minimum royalty payments are now due under a coal mining lease entered into by Banner Coal Company under the Act of April 21, 1932 (47 Stat. 88).

(1) Lease year for the purpose of computing minimum royalty payments began on anniversary date of execution of lease and not on anniversary date of approval.

(2) Leases having met the requirements of the lease for the year commencing October 24, 1940, and having given notice of its intention to surrender its lease before the beginning of a new lease year on October 24,

1941, no minimum royalty payments are now due.

MY DEAR MR. SECRETARY:

    You have requested my opinion as to whether any minimum royalty payments are now due under a coal mining lease entered into by the Choctaw and Chickasaw Mining Trustee and the Banner Coal Company pursuant to the provisions of the act of Congress approved April 21, 1932 (47 Stat. 88).

    The act, among other things, provides for the leasing of any developed tract of the unsold coal deposits of the Choctaw and Chickasaw Nations in Oklahoma. The pertinent provisions of the act for the purposes of this opinion are:

    "* * * that the leases shall require the mining of a minimum of fifteen thousand tons of coal per annum from each tract leased, or the payment of royalty thereon at the said rate the same as if the coal had been mined: Provided further, That $500 of the annual minimum tonnage royalty shall be paid annually in advance, beginning with the date of approval of the lease by the Secretary of the Interior, that the royalty paid on the minimum tonnage for any year shall not be applied on the minimum royalty due for any prior or subsequent year, and all moneys received as royalties or otherwise for leases made under the provisions of this Act shall be deposited in the Treasury of the United States to the credit of the Choctaw and Chickasaw Indian Nations; * * *."

    Section 2 of the statute provides, among other things, for the leasing of any developed tract of the unsold coal deposits of the Choctaw and Chickasaw Nations and accords to prior lessees, or their successors in interest by judicial sale or otherwise, a preference right to a new lease on the developed premises. The Banner Coal Company, as successor in interest to the McAlester-Edwards Coal Company, became entitled to such a preference and the lease in controversy was made with that company on October 24, 1935, by the mining trustee of the Choctaw and Chickasaw Nations. The lease was approved by the Assistant Secretary of the Interior on March 25, 1936. The lease became effective, according to its provisions, on the date of its execution and, unless sooner terminated by surrender or cancellation, extended to September 25, 1947. The lease, when executed, provided for the payment of royalty at 8 cents per ton on all coal mined. This rate was subsequently increased to 10 cents per ton. As security for the performance of the terms and conditions of the lease the Banner Coal Company deposited United States bonds in the amount of $3,000.

    On August 20, 1941, the Banner Coal Company made application to the mining trustee for the surrender and cancellation of the lease "for the reason that the mine from which properties were operated has reached a depth that mining operations can no longer profitably be carried on." In submitting its application the company states that it has sustained an operating loss of some $21,000 for the three years preceding its application despite changes in operating methods resorted to at considerable expense in an effort to make the mine pay a profit. Under section 12 of the lease the privilege of surrender is conditioned, among other things, upon the payment of all amounts due at the time of surrender. On October 11, 1941, the mining trustee recommended that the lease be cancelled and that the company be held liable for the minimum tonnage royalties for the sixth year of the lease, which the mining trustee contends commenced on March 25, 1941, the anniversary of the date of approval of the lease. The company contends that the royalties should be computed from the time of the execution of the lease, which is October 24, 1935. If the date contended for by
 

the company be the proper one, according to the statements of bath the company and the mining trustee, no minimum royalty is due, since the company gave notice of its intention to cancel 30 days prior to the beginning of a new lease year on October 24, 1941, and since the company had paid royalty on in excess of 15,000 tons during the period between October 1940 and March 1941, when operations stopped. If the contention of the mining trustee be correct-that the lease year for the purpose of computing minimum royalties commenced on March 25, 1941-the company is liable for the entire amount of minimum yearly royalty of $1,500 because, no coal was mined and no royalty payments were made on or after March 25, 1941.

    The question to be decided, therefore, is whether the lease year, for the purpose of collecting minimum royalties, began on March 25, 1941, or on October 24, 1941. This depends, of course, upon whether the lease became effective from the date of its execution or from the date of its approval.

    The language of the statute requiring that royalties be paid on the minimum of 15,000 tons of coal annually, whether mined or not, does not specify the date on which the annual period shall begin. Since the proviso, which deals with advance payment of part of the minimum royalty, provides for such payment beginning with the date of approval of the lease, and since such payment cannot, when made, be credited on the minimum tonnage royalty for any prior or subsequent year, the mining trustee contends that the effective date of the lease for the purpose of computing both the advance and minimum royalty must be the date of its approval by the Secretary of the Interior. In making this contention the mining trustee relies upon the familiar rule that statutory provisions must prevail over regulations or contracts made thereunder. This rule, though correct when properly applied, is without application, in my opinion, to the present case.

    The essence of the statutory provisions relied upon by the mining trustee is that the lessee shall mine or pay royalty on at least 15,000 tons of coal each year during the effective period of the lease. To secure the performance, at least in part, of this obligation, the lessee was required to pay in advance each year $500 of the required minimum tonnage royalty. In so far as the accomplishments of these objects is concerned, it is obviously immaterial whether the lease began to run from the date of its execution or from the date of its approval. So long as the statutory objectives were met, the Secretary, in prescribing regulations, might have selected either date with equal propriety. True, the provision for the payment of the $500 advance royalty is framed in mandatory language but the mandatory direction plainly was intended to require that the payment be made each year in advance-not that it be made on the actual date of approval nor that the lease become effective on that date. In the absence of an agreement to the contrary, the usual rule is that the approval by the Secretary of the Interior of a lease of this type relates back and takes effect as of the date of its execution. Anchor Oil Co. v. Gray, 256 U.S. 519. In prescribing the regulation of 1932 it is apparent that the Secretary was guided not only by this rule but by the practical consideration that continued operation of existing developed mines by lessees in possession, such as the Banner Coal Company, would be to the mutual advantage of the Indians and the lessee.

    The parties contracted accordingly and performance has proceeded in good faith in conformity with their contract. The records show that up to and including August 20, 1941, the date of the application for surrender and cancellation of the lease, the Banner Coal Company mined and paid royalty on quantities of coal in excess of the minimum requirements of the lease. From the date of execution of the lease to the date of its approval, the company paid in royalty some $2,000 on coal mined. Under the construction contended for by the mining trustee, the company would be deprived of the benefit of this performance and placed in the position of a trespasser during that period. The inequities resulting from such a construction are obvious.

    The amendments to the regulations and lease form made on August 24, 1936, were, as has been noted, to govern leases thereafter entered into. They have no application to pre-existing leases such as that of the Banner Coal Company.

    In conclusion, I am of the opinion that the lease of the Banner Coal Company became effective on the date of its execution on October 24, 1935; that the new lease year for the period now in controversy began on October 24, 1940; that since the company has met the requirements of its lease for that year and gave notice of its intention to surrender its lease before the beginning of the next lease year, no minimum royalties are due; and that the company is entitled to the return of its bonds.

                                                                                                                                            NATHAN R. MARGOLD,

Approved: March 39, 1942.
W. C. MENDENHALL, Acting Assistant Secretary.