Mr. BOWDEN. The oil company complied with the law? Mr. BOWDEN. Can the homesteader now use that land? Mr. BOWDEN. He has to pay taxes on that land, doesn't he? Mr. FAVORITE. I understand the county is compelling him to pay taxes on it. Mr. BOWDEN. Is the situation presented in this instance similar to the situation presented in other homesteads in this State? Mr. FAVORITE. Yes; although none of the others have reached the acute stage that this one has. There are a number of others, however, in exactly the same fix. Mr. BOWDEN. Have you any recommendation to make to alleviate this difficulty? Mr. FAVORITE. The only way in which this particular case can be helped, as I see it, is for Congress to pass an act which will grant to Mr. Butts the right to select another tract of land in lieu of the one that he has lost. The CHAIRMAN. Would that satisfy the difficulty? Mr. FAVORITE. I think that would satisfy him. Of course it would not prevent the recurrence of this same trouble. The CHAIRMAN. Have you any suggestion of a remedy that would prevent its recurrence? Mr. FAVORITE. Yes. The act of July 17, 1914, which permits the making of such entries, and of course covers other entries besides stock-grazing homesteads, could be amended to provide that such entries could not be made upon lands that are already claimed or held under the mining laws. The CHAIRMAN. That would lessen the probability of the occurrence of such a situation? Mr. FAVORITE. That would make it impossible for the same situation to occur again. The CHAIRMAN. Well, in another homestead outside of the mineral zone it might be discovered that there was oil underlying the land? Mr. FAVORITE. If the discovery is made subsequent to the filing of the homestead entry, then the law provides damages for the homestead claimant. The CHAIRMAN. I understand. Mr. FAVORITE. But if the mineral claimant is there first, the homestead entryman can not then get any damages. The CHAIRMAN. Thank you, Mr. Favorite. That is all. Mr. Butts. STATEMENT OF ENOS D. BUTTS, HOMESTEAD ENTRYMAN, LOST HILLS, CALIF. The CHAIRMAN. Mr. Butts, have you a statement that you wish to make to the committee? Mr. BUTTS. Mr. Favorite has covered it very thoroughly, but I want to make this statement: The Government issued to me a patent to a piece of land which they did not give to me, and I am paying taxes on a mythical thing. I paid 50 cents apiece for redwood posts and put them on that land and put a fence around it. Then they gave the oil company the right to go in there for oilwhich I presume was in good faith. Then they went in there and took a truck and went right down the fence, knocked the fences down, took the posts out and trucked them off down the canyon, and I suppose they thought that was acting in good faith too. I am paying taxes on that land and have no redress. I do not expect to acquire the oil right to the land, and did not at the time of filing it. They have crisscrossed this land with roads, pipe lines, and telegraph poles, and they have ruined the value of the surface-right entry and taken off the improvements. The Government wrote to me and offered this: As near as I can word it, they said that if I would surrender my patent and quitclaim that to them, showing that the land was not encumbered, they would allow me to file on an additional piece of land of approximately 320 acres and issue patent to me without further showing. But they didn't show me where the land was to file on. I am not able to run around and find any land in the State of California, and if I did find any it would probably be so far away it would not be of any value to me. Senator ODDIE. Do you know of any piece of land equally valuable that is available? Mr. BUTTS. No; I do not. I am the only homesteader, I think. As the fellow says, I don't know whether I am too poor to move away or whether I haven't pride enough to move away; but I have been 15 years out there on that homestead in the desert. So I think that the only redress I have is for the Government, instead of allowing me to file on land and issue me a patent, through an act of Congress to issue me lieu land scrip for it. There may be some place that the scrip can be done something with. Mr. BOWDEN. Were these improvements that you made made prior to the granting of the oil lease or subsequent to the granting of the oil lease? Mr. BUTTS. They were made prior. Mr. BOWDEN. They were made subsequent to your filing on the land? Mr. BUTTS. Yes, sir. Mr. BOWDEN. Have you estimated the amount of money expended by you on these improvements? Mr. BUTTS. The law requires me to expend $1.25 an acre before I can offer final proof. The CHAIRMAN. Have you done that? Mr. BUTTS. I have. The CHAIRMAN. And you have made final proof? The CHAIRMAN. And you now have title to the land? The CHAIRMAN. And you are paying taxes on the land? The CHAIRMAN. How long have you had patent to the land? The CHAIRMAN. The only remedy that you can conceive is that of having a relief act passed by Congress directing the Interior Department to issue to you scrip that you might place on other land wherever you may find it? 43213-25-PT 14- -8 Mr. BUTTS. Well, I don't say scrip-or something along that line. Yes, that is the only way I can see out of it. Senator ODDIE. Even if that should happen how much would you still be out? Mr. BUTTS. Well, that is a hard question to determine, because they ruined the valuation of the land. Now, if you had the land and could use it, that is a question of how much you would produce off from your land. The CHAIRMAN. What is the land worth? Mr. BUTTS. The land is worth $25 an acre. Mr. BUTTS. Three hundred and twenty acres. The CHAIRMAN. It is agricultural land? Mr. BUTTS. It is stock-grazing land; a part of it. It is rolling country. Senator ODDIE. What did your surface improvements cost? Mr. BUTTS. Between $500 and $1,000. I have forgotten exactly what it is. The law requires The CHAIRMAN. Three hundred and twenty acres? Mr. BUTTS. Three hundred and twenty acres. you to spend $480 on it. The CHAIRMAN. You did not take it under the 640-acre? Mr. BUTTS. I took it in addition to my original homestead. Mr. BOWDEN. What use were you making of this land prior to the oil company coming on the land? Mr. BUTTS. Why, running stock on it. Sheep. Mr. BOWDEN. Being used by you for grazing? Mr. BUTTS. Yes, sir. Mr. BOWDEN. Did you use it yourself or did you lease it? Mr. BUTTS. Well, I leased it and used it. We were in partners. I leased it to a sheepman with this provision, that he would take my sheep and run them with his band while he was on there. The CHAIRMAN. Any further questions? Mr. BUTTS. I would like to make a statement here in behalf of the homesteaders, as there have been a great many of them talked to me about this, and this is not my part, but the consensus of the homesteaders in general in that part of the country; they seem to be of the opinion or belief that there should be some act relieving them where their land is encumbered by the oil-prospecting permits. Now, these permits, it seems, have been given to people who are not financially responsible to go ahead and drill wells, and when they get their surface-right patent with another party holding the Government permit which will be extended from time to time, when they try to do anything with their land they can not do it because the land is encumbered and they can not pass a clear title to it. and they seem to be of the opinion that where a homestead is off any given number of miles of a nongeological gas and oil structure that it should be restored to the public domain and be relieved of this burden of allowing permits to be issued on it. And as far as issuing homesteads in this particular case of where my homestead was filed in the Bear Creek, I believe that the entryman should either receive the whole business or do away with giving homesteads on nongeological oil structures altogether. Do away with that. But restore the land to the public domain area where it is off of nongeological oil and gas structures. That would relieve a whole lot of this tangle that the men are getting into now. And what I wanted to do is to have it a matter of record, that if the committee would approve of issuing that lieu land scrip or something like that, it would be of record so that the Senate could readily refer to it. The CHAIRMAN. I presume you contemplate having your Congressman or Senators introduce a relief bill? Mr. BUTTS. Yes, sir. The CHAIRMAN. Very well, Mr. Butts, we will have the record on the case as taken from you here, and it will be presented at that time. Mr. Miller. STATEMENT OF MONTGOMERY K. MILLER, CIVIL ENGINEER, OAKLAND, CALIF. The CHAIRMAN. Mr. Miller, will you give your name and address and occupation to the reporter. Mr. MILLER. Montgomery K. Miller, Oakland, Calif.; civil engineer professionally. The CHAIRMAN. Now, Mr. Miller, have you a statement that you wish to make to this committee? Mr. MILLER. I wish to call the committee's attention to a most extraordinary situation which prevails in this State in reference to the mineral lands in the Southern Pacific Railroad grant. The railroad company, or its subsidiary, the Pacific Oil Co., claims to own and has control and is operating oil lands in this State estimated to be worth a billion dollars to which, in fact, according to the record, they have not even a shadow of title. I have the record in my pocket. It takes about two minutes to read it. The same situation prevails in reference to metalliferous minerals. The railroad company claims all the metalliferous minerals within its grant. Now, the granting act passed by Congress in 1866 specifically excepts and excludes mineral lands from the grant. It went further and excluded mineral lands from the operations of the act. It is a very broad, far-reaching provision. The CHAIRMAN. Was that not except as to coal and iron? The CHAIRMAN. All other minerals but coal and iron. Now, at the time of the passing of the grant was oil designated as a mineral? Mr. MILLER. The Supreme Court has always ruled-never to the contrary-that oil is a mineral. Now, the entire record consists of the granting act, the land commissioner's decree preliminary to patent issued 28 years after the grant was made, and the patent itself. Both those instruments except and exclude all mineral lands should any such be found in the tracts aforesaid. Such provision has always been placed in railroad grant patents. It has always been the policy of the Government that vast areas of mineral lands should not pass to private. control and become a monopoly. The Southern Pacific Co. for 28 years after the grant voluntarily inserted in every deed they drew to purchasers of grant lands a reservation to the effect that they had no title to mineral lands and could not convey mineral lands. At the end of 28 years nothing transpired to change the status of the titles. Now, Congress has never conveyed mineral lands to the railroad company. And no power exists except in Congress to make the conveyance. No administrative official and no court has the power to covney the mineral lands to the railroad company, to override Congress and make the conveyance. Such being the case, it can not be legally possible that the railroad has any title. Any court decision or any departmental decision to the contrary must of necessity be not only erroneous but absolutely void for want of power. The CHAIRMAN. Have any of those cases been passed upon by the Supreme Court? Mr. MILLER. Yes. The CHAIRMAN. And what are the decisions of the Supreme Court as to that? Mr. MILLER. In 1909 there was quite a little stampede on the part of the citizens here in California to locate, to file mineral locations on oil lands claimed by the railroad company, and to contest the title of the company. The case first to get into the court is known as the Burke case. That case passed through the lower courts and on up to the Supreme Court, and there is evidence that it was a framed case. That the railroad company and Burke, who handled the litigation, framed the case. I have an affidavit myself made by a reputable citizen, who is here in San Francisco-I saw him to-day-that Burke admitted to him receiving $50,000 from the railroad company to frame the case. The original of that affidavit is in Washington to-day. There is considerable surface evidence that there was something crooked about that case. In presenting it to the courts Burke and the railroad company both presented a case which placed the burder: of the question of title upon the patent. They argued that the patent was the law of the grant. They ignored the fact that the granting act itself was the law of the grant. And that fundamentally the patent could not under any circumstances operate to enlarge or restrict the grant. They plead the general land laws as a matter of fact. And the doctrine that has been well established by the courts that a general land law patent to a homestead which contains no mineral reservation should be applied to the railroad grants. Ignoring the fact that the railroad grant was made by a special law, a special act of Congress that differs entirely from the general land laws. Ignoring the fact that ever since railroad grants were made the patent issued to those grant lands differs from homestead patents in reference to the reservation clause. That clause has always been placed in railroad land grant patents, but never in homestead patents. We have a situation here that is simply intolerable. The decision in that Burke case applies not only to the Southern Pacific grant but to all the railroad grants made. And it places the mineral resources of the country to-day in the hands of the railroad companies. It ought to be possible; it ought to be a simple matter to correct |