Document: 373 U.S. 472 83 S.Ct. 1373 10 L.Ed.2d 491 Fenelon BOESCHE, Administrator, etc., Petitioner,v.Stewart L. UDALL, Secretary of the Interior. No. 332. Argued Feb. 25, 1963. Decided May 27, Leon BenEzra, Washington, D.C., for petitioner. Archibald Cox, Sol. Gen., respondent. Mr. Justice HARLAN delivered opinion Court. 1 The question presented in this case is whether Interior has authority to cancel an administrative proceeding a lease public lands issued under provisions Mineral Leasing Act 1920, 30 U.S.C. §§ 181 et seq., circumstances where such was granted violation and regulations promulgated thereunder. Because seeming conflict principle between decision Court Appeals case, 112 U.S.App.D.C. 344, 303 F.2d 204, that Tenth Circuit Pan American Petroleum Corp. v. Pierson, 284 649, also because importance proper administration Act, we brought here. 371 886, 184, 9 120. For reasons stated hereafter affirm judgment below. 2 Section 17 § 226, authorizes grant first qualified applicant, without competitive bidding, oil gas leases domain not within known geologic structure. These are called 'noncompetitive' leases.1 A departmental regulation provides 'no offer' noncompetitive 'may be made less than 640 acres except * land surrounded by available leasing act.' 43 CFR 192.42(d). 'Not available' always been administratively construed mean anyone. Hence covered only outstanding application considered available, Natalie Z. Shell, 62 I.D. 417 (1955), therefore subject 640-acre requirement. 3 On September 11, 1956, petitioner2 applied Santa Fe Land Office New Mexico (whose embraces Oklahoma) 80-acre Oklahoma. There already on file one Connell adjoining 40-acre tract, but no had at time petitioner's application. Immediately following two other persons, Cuccia Conley, filed entire 120 acres. December 1, Connell, validity which questioned In November 1957 Following notification their 120-acre rejected, Conley pursued appeal, 221.1—221.2. This ultimately resulted cancellation ground having failed include his tract (no then issued), invalid, thus leaving respect prior right. Accordingly them directed.3 4 ensuing litigation instituted petitioner Federal District Appeals, now review, sustaining cancellation. 5 Petitioner's claim before Court4 rests 31 188, as amended, which, pertinent part, reads follows: 6 'Except otherwise herein provided, any (this Act) may forfeited canceled appropriate United States district court property, or some part thereof, located whenever lessee fails comply with (the Act), lease, general force date *. 7 'Any after August 21, 1935,5 (§ 226) shall thirty days' notice upon failure unless until contain valuable deposits gas.' 8 Petitioner contends: (1) exclusive source Secretary's power forfeit once it issued; (2) section, its second paragraph, limits instances terms so long gas; (3) since regulation, governed paragraph 31, requires judicial proceeding. Secretary, hand, whole apply events, terms, regulations, occurring basis pre-lease events found powers management over domain; remained unaffected Act. I. We think lands, invalidity inception, withdrawn With earlier statutes containing express authority, Court, Cameron States, 252 450, 40 410, 64 L.Ed. 659, exist. there invalid mining claim, said (at p. 461 U.S., 413 S.Ct.): 11 'True, mineral law does itself confer Department. Neither place elsewhere. But exist anywhere, for, absence direction contrary, statutory mentioned vest Department.' 12 referred those vesting managerial lands.6 13 held possess same kinds interests lands: Harkness & Wife Underhill, Black 316, 208; Lee Johnson, 116 48, 249, 29 570; Orchard Alexander, 157 372, 15 635, 39 737 (all involving homestead entries); Brown Hitchcock, 173 473, 19 485, 772 (selection list); Knight Assn., 142 161, 258, 35 974 (erroneous survey); Hawley Diller, 178 476, 20 986, 44 1157 (timber entry); Riverside Oil Co. 190 23 698, 47 1074 (lieu selection). 14 continuing vitality recently confirmed us Best Humboldt Placer Mining Co., 334, 379, 350. persuaded argument—based cases holding patents accepted could proceedings (e.g., Johnson Towsley, Wall. 72, 485; Moore Robbins, 96 530, 24 848)—that established cited confined so-called equitable interests, resemble more closely legal interest conveyed patent, power. matter how denominated true line demarcation result transaction 'all control' passed from 'the Executive Department,' supra, 533, Government continues measure control them. 16 Unlike divests title, Congress reserved fee leased land, subjected exacting restrictions supervision Secretary. Thus, assignments subleases must approved 187; he direct complete suspension operations 209, require operate cooperative unit plan, (Supp. IV, 1963), 226(j); prescribe, has, rules governing minute detail all facets working 189; CFR, pt. 221. short, give anything approaching full ownership patentee, nor convey unencumbered estate minerals.7 Since connection subsist, should have power, correct own errors. dispositive therefore, To turn. II. 18 believe both statute face legislative history enactment show reaches cancellations based post-lease leaves traditional factors. 1. Were deemed cancel, 'first applicant' requirement relating leases, would self-defeating. breach statute, lessee, factor alone brings into play (p. 475, supra), powerless even if applicant. local office manager might, fault inadvertently purposefully issue nonqualified Yet view wholly unable, either proceedings, remedy illegal action. 2. 31—the depends—speaks entirely occurrences. Thus providing 'whenever (not applicant lease) *.' (emphasis added), provision clearly assumes existence valid lease. It cover situation where, here, occurs, cancel. 21 3. forfeiture originally enacted, are, partial exception, concerned events. authorized when drilled 200 feet boundary 16, 41 Stat. 443), rpovision granting rights way pipelines through 28, 449). And prospecting permits, permittee's exercise due diligence 26, 448).8 22 sole exception post-issuance scheme that—is 448, excess certain minimum acreage allowances. here apparent initially awards excessive subsequent pooling separate grantees, effect avoiding limitation. 27 born fears large companies might obtain monopoly resources lands. See H.R. Rep. 206, 65th Cong., 2d Sess., 5. 4. background points against likelihood intended curtail respecting invalidly (pp. 476—478, supra). Public opened entry placer claims February 1897, 526. 1909, confronted rapid depletion petroleum reserves system, President proclamation withdrawing further pending conservation legislation upwards 3,000,000 California Wyoming. 1914 bill Houses died conference close session, see H.R.Rep. 668, 63d program each 1920 passed. 25 committee reports reveal main congressional concerns prevention overly consumption Government, particularly Navy, need future. Sess. Conservation dominant theme debates. See, e.g., 398, 66th 1st 13. report version eventually became stated: 26 'The provided herein, thought, will go toward reserv(ing) right supervise, control, regulate (development natural resources), prevent waste lax methods grown up our public-land laws.' 1138, 3d 19. surprising find expand, contract, restriction error—a firmly established. pp. supra. More particularly, can perceive reason why given permit (later lease), implicitly denied him pre-issuance 28 fragmentary excerpts relied do suggest opposite conclusion. comment lease' course discussion floor Senate about were producing wells existence, assumed lease;9 situation. remark House debates 'there showing secured' occurred Act,10 is, seen, forfeitures. III. From beginnings conceived drawn never interfered exercise. invoked (note 8, accompanying text). Leach Cornell, 1687 (unpublished decision, Aug. 13, 1921); McCarthy Son, A—2398 Mar. 4, 1922); Murray McNabb, A—4412 14, 1923); Moon Woodrow, 51 118 (1925); Drake Simmons, A—16885 Oct. 1932). replacement permits 1935 exercised Boesche, A—21230 1938); Reay Lackie, 60 (1947); Iola Morrow, A—27177 10, 1955); R.S. Prows, 66 (1959).11 Although relates amended dozen times last years,12 long-continued practice. conclusion plain Congress, did ratify conduct, least regard inconsistent Cf. Ivanhoe Irrig. Dist. McCracken, 357 275, 293, 78 1174, 1313; Fleming Mohawk 331 111, 116, 67 1129, 91 1375; Billings Truesdell, 321 542, 552—553, 737, 88 917. IV. 32 present peculiarly determination instance. At simply offer defective another party, decided adversely position previous interpreting regulations. Matters nature warrant initial submission process. Indeed magnitude complexity conducted Secretary13 make likely seriously detrimental prompt efficient federal courts well consequence shift leases. 33 Recognition serves protect domain. Cancellation kind erroneously gives designed check undue splitting tracts, facilitate frauds, hinder development resources, render very burdensome. Annie Dell Wheatley, 292, 293—294 (1955). addition, type safeguards conflicting claimants. 34 day-to-day operation Bureau Management, managers offices act chronological sequence. If qualified, appears conform issue. come applications land. later denied. denial probably afford occasion investigate truth appeal Director Management office's business, cancellation, while pending, essential secure competing applicants.14 sanction broader rule exigencies particular case. hold errors sort involved timely applicants 36 open door abuses. Department provide adversary appeals taken private parties affected decision. generally Appeal right, 221.1, 221.31, appellant required notify opponent, 221.4, 221.34, latter participation, 221.5—221.6, 221.35. final action 221.37, review. 226—2; see, Noble Union River Logging R. 147 165, 271, 37 123; conclude affirmed. 38 Affirmed. Competitive bidding structures. actually administrator original convenience disregard distinction. Pending outcome litigation, Manager withheld limited writ certiorari single administratively, 120, bringing review interpretation minimum-acreage sustained Appeals. note infra. 441, charges 'with business (p)ublic including mines.' He directed 453, 2, 'perform executive duties anywise (of States),' 2478, 1201, 'to enforce carry execution, every Title dealing lands) specially for.' contrast, compare claimant whose location perfected: innumerable decisions state lower courts, that, perfected law, possession. property fullest sense term; sold, transferred, mortgaged, inherited infringing title States. owner taxable state; 'real property,' lien purchase patent States; but, complies laws, possessory practical purposes ownership, good though secured patent.' Wilbur ex rel. Krushnic, 280 306, 316—317, 50 103, 104, 74 445. orginally issuance 441. converted 49 674, 676, conditions proven carried 17. 678. 1946 transferred 31. 956. As explained S.Rep. 1392, 79th 3, transfer effected substantive change powers: 'Section consolidate section various termination default substance existing being retained section.' 58 Cong.Rec. 4168. 7604. Melish Consolidated Testerman, 53 205 (1930), First Assistant 'lease beyond recall (Sec. 1920).' dictum, expressed reference casts doubt uniform regarding April 30, 1926, 373; July 1930, 46 1007; March 1931, 1523; 1935, 674; 1937, 842; 1946, 950; June 1948, 285; 1949, 63 682; 29, 1954, 68 583; 648; 1959, 73 571; 1960, 781. brief 12—13), informs 139,000 supervised 113,000,000 total number programs—public acquired Indian, Naval Reserve Outer Continental Shelf—was 159,000, covering 125,000,000 many multiple sometimes hundreds tract. example, one-month period 1961 10,742 alone, acreage. three-year ending 1,129 out 54,000 during period. contends permitted imprudent precarious, assume financial risk developing effective term curtailed finally delay—and perhaps longer one—would remitted

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