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quality of the talc and silica is satisfactory for commercial uses; that there is a market for talc and silica; and that the claims are accessible to that market. He found that, although several thousand dollars had been spent on the claims since the hearing in 1956 on road construction and in further exposing the silica deposits, no one has determined whether there is a sufficient quantity of material on the claims to be economically competitive with the other sources of supply. He concluded that the statement presented at the second hearing in the form of a letter from Drury A. Pifer, in which Pifer gave his opinion as to the indicated and inferred tons of material on the claims, might induce further effort on the claims but that it is not sufficient to induce a production program. He found that, despite the fact that tale and silica have been known to be on the claims for many years and despite the fact that considerable effort has been expended on the claims, the basic exploration necessary to determine whether the material can be successfully marketed has not yet been completed. He stated that until there is sufficient evidence to verify the marketability of the deposits, he could only conclude that the contestees have not proved the existence of a valuable deposit on any one of the claims. He reaffirmed his decision of January 3, 1957, declaring the mill site to be null and void.

The Assistant Director, in his decision of March 6, 1963, after referring to the necessity for a showing of present marketability in connection with claims covering nonmetallic minerals of widespread occurrence in order to validate mining claims covering such materials, stated that the issue posed by the appeal was whether the contestees had refuted the Government's showing that sufficient quantities of commercial talc and silica have not been exposed on the lands to warrant a conclusion that there has been a discovery of mineral deposits of commercial value. He concluded that further exploration work would be necessary to determine the extent of the mineral deposits upon each of the mining claims and held that the hearing examiner was correct in declaring the claims to be null and void. He also affirmed the hearing examiner's decision as to the invalidity of the mill site.

In their present appeal, the contestees contend that the Assistant Director failed to give proper weight to the testimony presented at the hearings dealing with the quantity of talc and silica on the claims and that he has distorted the facts presented at the hearings in order to reach a conclusion that the materials found on the claims are not marketable. They accuse the Department of having added to the elements necessary to show marketability and contend that under the

recent trend of departmental decisions marketability has become the sole test of the validity of mining claims.

Considering the general charge against departmental decisions first, this charge is one which arises through a misunderstanding of the Department's position with respect to the necessity for a showing of marketability when the mineral dealt with is not an intrinsically valuable mineral. The Solicitor recently reviewed the "marketability rule" as applied to the law of discovery and pointed out that the rule is but one aspect of the prudent man test1 applied over the years to determine the validity of mining claims. The Solicitor held that to determine whether nonmetallic minerals not in themselves intrinsically valuable, and found in a great many places, are valuable mineral deposits within the meaning of the mining laws, Rev. Stat. § 2319 (1875), 30 U.S.C. § 22 (1958), the application of the prudent man test requires that a market for the mineral must be shown. It was said unequivocally that the marketability test is only one aspect of the prudent man test "albeit a very important aspect since in the absence of marketability no prudent man would seem justified in the expenditure of time and money." The Solicitor stressed that each case must be judged on its own facts. 69 I.D. 145 (1962).

The law is that where minerals have been found and the evidence is of such a character that a person of ordinary prudence would be justified in the further expenditure of his labor and means with a reasonable prospect of success in developing a valuable mine the requirement of discovery necessary to validate a mining claim has been

met.

Implicit in the evidence required to justify a prudent man in spending his time and money to extract the minerals is a showing that the quantity of minerals on the claim is sufficient to justify his effort. Thus, even in the case of intrinsically valuable minerals, to constitute a valid discovery upon a lode claim for which patent is sought, there must be actually and physically exposed within the limits thereof a vein or lode of mineral-bearing rock in place, possessing in and of itself a present or prospective value for mining purposes. East Tintic Consolidated Mining Claim, 40 L.D. 271 (1911). A discovery, to satisfy the requirements of the law, means more than a showing of isolated bits of mineral not connected with or leading to substantial value. It is not enough that the claimant may have shown that it is possible to detect the presence of some minerals in the material removed from the claim and that this material was removed from

1 Set forth by the Department in Castle v. Womble, 19 L.D. 455 (1894), approved by the United States Supreme Court in Chrisman v. Miller, 197 U.S. 313 (1905), and recently reaffirmed in Best et al. v. Humboldt Placer Mining Co., 371 U.S. 334

(1963).

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veins or fissures. United States v. Josephine Lode Mining and Development Company, A-27090 (May 11, 1955).

A fortiori, to validate a claim covering minerals for which a market must be shown, it must appear that the minerals probably exist in such quantities as will justify their extraction. United States v. Everett Foster et al., 65 I.D. 1 (1958);2 United States v. Charles H. and Oliver M. Henrikson, 70 I.D. 212 (1963).3 Otherwise a prudent man would not be warranted in spending his labor and money in an effort to develop a valuable mine and he would not have such a discovery as would satisfy the requirements of the mining laws to entitle him to a patent.

Thus a disclosure of minerals in apparently sufficient quantities to make a mining operation worthwhile, i.e, a showing of minerals to such a probable extent that, with actual mining operations under proper management, a profitable venture may reasonably be expected to result, is required. United States v. Santiam Copper Mines, Inc., A-28292 (June 27, 1960).

While evidence as to the quantity of minerals found on mining claims has often been discussed by the Department in connection with determining the marketability of minerals of widespread occurrence with no intrinsic value, the factor of quantity is an important aspect to be considered in determining whether any claim has validity. Whether that factor is treated as being a part of the showing required to establish a market for the minerals or as a separate phase of the prudent man test is immaterial since, in any event, before a claim can be considered valid under the mining laws there must be shown to be probably present on the claim minerals in such quantities as will justify the further expenditure of labor and money with a reasonable prospect of success in developing a valuable mine.

This is not to say that the full extent of a mineral deposit must be actually blocked out before the prudent man test is satisfied. It is required, however, that there be a preponderance of reliable evidence that the mineral deposit is probably of such a size that a person of ordinary prudence would be justified in spending labor and money on the claim with a reasonable prospect of success in developing a valuable mine.

We come then to the one part of the prudent man test which the hearing examiner and the Assistant Director found the appellants had

'Affirmed Foster v. Seaton, 271 F. 2d 836 (D.C. Cir. 1959).

Affirmed by the United States District Court in and for the Northern District of California, Southern Division, in Henrikson v. Udall, Civil No. 41749, on May 22, 1964, and now on appeal to the United States Court of Appeals, Ninth Circuit.

not met to establish the validity of the six mining claims and to the appellants' contention that proper weight was not given to the evidence presented at the hearings as to the quantity of talc and silica on the claims.

The appellants cite two showings made at the hearings which they contend would support a finding that there are sufficient amounts of talc and silica on the claims to justify the issuance of patents. They contend that this evidence has been misconstrued or ignored. One showing is Exhibit Q, produced at the second hearing. The exhibit is a statement by Drury A. Pifer in which he, on the basis of his field notes taken when he examined the property in August 1956, gave his opinion as to the tonnage of indicated ore and inferred ore on the claims." Pifer's estimates ranged from 200 tons of indicated silica and 700 tons of inferred silica, a total of 900 tons, on Rockport No. 3 to 80,000 tons of indicated silica and 166,000 tons of inferred silica, a total of 240,000 tons, on Silica No. 3. He estimated 50,000 tons of indicated talc and 300,000 tons of inferred talc, a total of 350,000 tons, on Silica No. 2.

5

Pifer was present at the first hearing. He testified that he examined the claims on August 15 and August 22, 1956. He testified that he measured the talc exposure on Silica Lode No. 2 to be 30 feet wide and along the surface for a distance of about 100 feet. Asked whether there would be any way of knowing what quantity of talc might be on Silica Lode No. 2, from the exposure he saw, he answered:

No, there isn't. The claim is covered by detridal [sic] material, forest duff and windfalls, and the rock in place has only been exposed on both sides of the creek and in the creek bed. It may continue. It very likely does. (1st Tr. 70.)

Asked:

From your experience, would you say that a reasonably prudent man would be justified in spending additional time and money to determine the extent of the location and whether or not a profitable operation could be obtained?

He replied:

Certainly when you have a discovery of this size, it would be worth-while to continue developing it, exploring it, in order to determine if the body continues, in the first instance, and how large and extensive it is in the second, with the hope

'Pifer stated that he was using the commonly accepted technical definitions of the terms indicated ore and inferred ore. He quoted a definition of the terms from Parks, R. D., Examination and Valuation of Mineral Property (1949):

"Indicated ore is ore for which tonnage and grade are computed partly from specific measurements, samples, or production data and partly from projection for a reasonable distance on geologic evidence. The sites available for inspection, measurement and sampling are too widely or otherwise inappropriately spaced to outline the ore completely or to establish its grade throughout Inferred ore is ore for which quantitative estimates are based largely on broad knowledge of the geologic character of the deposit and for which there are few if any samples or measurements. The estimates are based on an assumed continuity or repetition for which there is geologic evidence."

Transcript, first hearing (hereinafter referred to as 1st Tr.), pp. 67-87.

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that it certainly will make a payable proposition from the mining standpoint. (1st Tr. 71.)

In describing the exposures of silica on the other claims, he repeatedly indicated that the claims should be explored more fully to determine the extent of the deposits (1st Tr. 74, 76-78).

The testimony given by Milvoy M. Suchy, the government's mineral examiner, at the first hearing was that not enough work has been done on the claims to warrant a guess as to the tonnage of talc that might be there, that the silica deposits have not been delineated, that there is not enough silica exposed on some of the claims to say what the extent of it is, that he found outcrops or float quite widely scattered, that he found what he believed to be a silica boulder buried in the bank which may be another parallel vein or a piece of float."

At the second hearing, after E. V. Pressentin had described the work done on the claims since the first hearing, including stripping the talc dike, removing several hundred tons of talc, and stripping on the silica claims, and after photographs of the claims, taken in May 1961, had been introduced and after the Pifer statement had been discussed, Herman Smith, a Government witness who mines talc from property which he leases, testified that looking at the claims he was unable to form any ideas as to the quantities of the deposits. This was because "there is no way, only by development work, to prove that." In reply to the question as to why this was, he responded that talc was not consistent, "it can cut off or fault ***. You have to follow it in order to decide whether it is going on in or whether it is going down." Responding to a question as to the silica deposits on the claims he replied: "Well, they are just kidneys-they are pockets and boulders of talc. There is nothing to indicate that it would go down." (2d Tr. 128-129.)

8

Suchy also testified at the second hearing. He testified that there are three faults on Silica Lode No. 2, one of which had been discovered since the first hearing, that where you have faulting and movement you can not depend upon projection because there is a possibility that the fault has moved the deposit, and that where there are faults it would be "rather risky and unreliable to assign any definite tonnage on the small manifestations that are present, of what you can actually see in the exposed face and in the other exposed dimensions near the face" (2d Tr. 151-152). He described an exposure of silica on another of the claims, stating that there are two contacts shown in one of the

* 1st Tr. 16, 21, 24, 29, 32, 35.

'Transcript, second hearing (hereinafter referred to as 2d Tr.), pp. 116-140. Tr. 142-176.