certain, and equitable law has produced much vexatious litigation, and in some deplorable instances has resulted in bloody encounters. A still greater amount of trouble is only prevented by a strongly developed sense of justice among the miners.

TERRITORIAL QUARTZ LAW.

The pre-emption and tenure of vein deposits are regulated by the territorial law of December 26, 1864, which provides for eleven claims of two hundred feet each upon the discovery of a crevice with one welldefined wall. Its advantages, arising from its uniformity, are not to be undervalued. At the same time, however, it cannot be denied that its ill-advised provisions have done more towards retarding the development of the mineral resources of the Territory than mismanagement, extravagance, and swindling speculations put together. Copied from the mining codes of other communities, it has retained their special provisions without incorporating others to ameliorate their bad effect. Its most objectionable feature is the creation of constructive claims without any restrictions, objectionable because

1. It places a premium on non-development.

2. It tends to the segregation of mining property in parcels too small for economical and profitable working.

3. It is the fruitful cause of litigation.

To fully understand the force of these objections it must be remembered that after the mere discovery of a lode it usually requires the expenditure of considerable money and labor to demonstrate whether it is a valuable and paying deposit or not.

Under the law there are nine distinct proprietors, all holding on the strength of one little gopher hole, each one of whom desires to avoid undertaking this necessary expense, hoping that his neighbor will do so for him. The consequence is that no work is done at all.

In my opinion the discoverer alone merits a reward for his industry, toil, and privations. He should receive sufficient ground, say 800 or 1,000 feet, so that, if his lode proves to be good, it can be worked in a proper manner. He would then know that he alone has to rely on his work to prove up his mine, and if he does not do so, he might as well have never made the discovery.

A tunnel law with extraordinarily liberal provisions is likewise in force.

UNITED STATES MINERAL LAW OF 1866.

When the passage of this law was first announced and before its provisions were fully understood and its effect realized, it was looked upon with the utmost distrust and its enactment was deeply regretted by the entire mining community. The law met with more favorable consideration when it was found that it did not infringe upon vested rights, but legalized possessory titles and merely gave an opportunity to obtain the United States title to those desirous of doing so, without being compulsory.

As soon as the Land Office was prepared to act under the law, a considerable number of applications for patents were filed, and a still greater number of mine owners determined to comply with the law and enjoy its benefits. Unfortunately experience soon demonstrated that the provisions of the law itself tended to render it inoperative. The following abstract of applications and entries admitted, communicated

by Mr. Lyman, the register of the United States land office, will best illustrate the practical working of the mineral act in Montana:

Of the entries admitted, three final patents were granted. From this exhibit it will appear that during the last six months only two parties have applied, and during the entire two years only thirty-four out of at least fifty thousand parcels of mining property have sought the benefit of the provisions of this law.

If the operation of the law in the past has been unsatisfactory, there is no reason to believe that it will be much more effective in the future. The causes which produce this result are much more easily defined than remedies suggested.

Mr. Keyes, in my last year's report, explained at length that the law is tedious, excessively costly, and that even the issuance of a patent does not materially diminish the probability of litigation. Circumlocution and red tape have certainly done much towards discouraging many who would otherwise have secured the benefits of the law. Modes of procedure should be simplified as much as possible, and this has been already done to some extent by a more liberal construction on the part of the Commissioner. Furthermore, there is no valid reason why the expense of survey should not be borne by the government, as with agricultural lands. An objection more difficult to remedy is that the law does not completely protect a patentee against vexatious litigation, owing partly to the nature of its provisions and partly to the loose wording of the law, leaving many questions open for discussion until they are finally expounded by judicial decisions.

These objections have tended seriously to retard the effectual working of the mineral act, but they are secondary in importance to the consequences springing from section 6.

To a correct understanding of the results which flow from its provisions it must be remembered that a lode worth patenting is rarely without contestants. Whenever a valuable ore-deposit is discovered the vicinity is immediately covered with float locations. Every discoloration of the country rock, every moss-covered ledge, every stray boulder is staked as the basis of a new discovery, either to secure some contiguous though legally distinct deposit, or more frequently to be used for purposes of litigation and black-mail. In such cases, and they are very frequent, an application for patent is at once met by adverse claims. No other steps then remain but to refer the matter to the courts.

Many mine owners possessing claims that are yielding large returns would gladly undergo all the delay, red tape, and circumlocution inci

dent to an application, and cheerfully submit to the onerous expense which it entails, if by that means they could secure the United States title and immunity from litigation; but they are not willing, in attempting to do so, to become involved in law-suits, the expense of which may consume the value of the mine and the result of which may strip them even of their present possessory titles. Hence they decline the proffered patent and prefer to rest upon their present possessory claims, trusting that the progress of actual work in the course of exploration will defeat any adverse claims.

Two questions arise:

1. Is it desirable to render the law more effective?

2. If desirable, how can it be done?

To the first question the mining community returns an emphatic No! Miners are perfectly content with the enjoyment of their present titles and desire no change, apprehending that further litigation might infringe upon some of their present rights. I cannot fully agree with this sentiment. Believing the utter extinguishment of the United States title to be the true policy of the government, most conducive to the prosperity of the mining industry and the safety of the individual owner, I hold that we should endeavor to mold a legislation which cannot be avoided. I have already suggested remedies to some of the objections. The manner in which veins should be patented, whether in square locations or based on the plane of the vein with an interdiction of close parallel locations, is a question which might properly be left to a commission representing the various mining States and Territories. I believe, however, that the recommendations made in another part of this report will offer a basis of compromise on which all sections may agree.

ASSAY OFFICE.

The

Although the Territory of Montana has produced the precious metals largely for a period of over six years, and though the strongest proofs exist that not only her mining industry will be permanent, but also, that with ordinarily favorable seasons the yield will be increased from year to year, as it has been in the past, even under the difficulties presented by high labor, defective methods of working and communicationyet in spite of all these inducements, the government has not yet established an assay office in the Territory, though branch mints exist in some States and Territories of the United States the annual product of which in precious metals does not come near that of Montana. Territory is far out of the way of the great connecting lines between the East and West, and distant from money centers; and, being so entirely isolated, it enjoys none of the benefits of a regularly circulating currency. So far, gold dust has been used to a large degree as a medium to facilitate business transactions, but in the absence of a government institution, where values could be at once and definitely fixed, this has often been done at a great loss to the miner. And even in making shipments of their dust the miners have not fared any better, being compelled to submit to exorbitant charges for transportation. I am by no means in favor of establishing branch mints in different States and Territories, as that would entail unnecessary expenses on the government; all the coining can be done far better and cheaper in one mint only; but government assay offices, established with the two-fold view of facilitating the development of new mining districts by making their benefits accessible to all, and of turning the gold and silver immediately into the hands of the government, seem to me imperatively demanded in the new Territo

ries as soon as the permanency of their mining industry is apparent. Such an office, by exchanging bars for drafts on the different sub-treasuries, deducting the cost of transportation, which would be less for the United States than anybody else, because large shipments may be made at a time, is of the greatest importance for the Territory of Montana. At present Helena seems to be the proper place for the office, on account of its central location as well as for the reason that it is the main business place in the Territory.

GOLD PRODUCTION OF THE TERRITORY.

To arrive at a correct approximation of the gold product is extremely difficult. On the one hand, gold dust is still, to a considerable extent, the currency of the country, and the amount used for that purpose is fluctuating and difficult to ascertain; on the other hand, the operations of assayers, bankers, and express companies are not yet made public. Based upon the best information obtainable, I would place the gold production of Montana for the year ending July 1, 1869, at $12,000,000. The estimate for 1869, given at $12,000,000, in the letter introductory to this report, was based on the yield of the fiscal year. Later reports, received while preparing this volume for the press, indicate a much smaller production, owing to the drouth. One correspondent puts it as low as $9,000,000; but I believe this would be too great a reduction.

The coming year will undoubtedly benefit by the decrease during the present, and the gold product of 1870, with a moderate supply of water, may be expected to exceed $15,000,000; with an adequate amount it is likely to reach $20,000,000.

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