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* The three original companies were not corporations; they were what are termed in that country unincorporated joint-stock associations, or common-law trusts. They partake of the nature of corporations and of partnerships, but are neither. They are not corporations and they are not partnerships. The property is held in trust by trustees.

"The Indiana gentlemen, upon my suggestion, formed the present corporation, known as the Burk Divide Oil Co. (Consolidated), and bought from the three little companies the three claims, and paid for the same stock of the present company." The CHAIRMAN. Is the date given, so as to show whether it was before or after? Mr. MACEY. It does not give the date to show when they bought; neither has that date been shown to this committee, as far as I have heard the testimony. He stated it was on a quit-claim deed blank; but as to the form of the agreement, I do not know. Mr. VAILE. As I understand your position, Mr. Macey, it is that placer locators who desire to have recognition of the locations which they claim under the mining laws, if they are granted relief, should take that relief according to the provisions of the mining laws?

Mr. MACEY. Yes. In my judgment, if a man is claiming his rights on the Red River under the mining laws, he should not come before Congress and ask for any more land or any more rights than the mining laws would give him.

Mr. VAILE. And your position is that the mining law does not give an assignee the right to perfect by subsequent discovery a claim which was not perfected before disovery? Is that a correct statement?

Mr. MACEY. The assignee of a placer claim can not perfect if he takes his assignment prior to discovery.

Mr. VAILE. He can not perfect by subsequent discovery?

Mr. MACEY. Except as to the 20 acres. If there are two assignees, he can perfect as

to 40 acres.

Mr. VAILE. Depending upon the portion of the land upon which discovery is made? Mr. MACEY. It must relate, of course, to the portion of the land upon which discovery is made.

Mr. VAILE. And your position is that when this matter is finally determined by the Department of the Interior, if the Department of the Interior is vested with the authority to determine it, then the parties should have an opportunity to be heard and to show whether or not there was a discovery prior to the assignment?

Mr. MACEY. That is exactly what we are asking for. If we are not entitled to any land down there, all well and good; but we would like the opportunity to go before the Department of the Interior, if that is the tribunal this Congress creates to pass on this, and to lay our claims before them and let them determine whether we have any rights or not.

Mr. BURTNESS. I recognize the force of that argument, that when any one claims under the provisions of the mining laws he ought to make a case showing he has complied with those laws; that he has not acted contrary to their provisions and given assignments.

Mr. MACEY. Yes.

Mr. BURTNESS. And you would recommend here that the remedial legislation be drawn so as to make all of the provisions of the placer mining laws the guide under which the department should act; in other words, you would treat this land just the same as if the provisions of the mining laws had applied throughout? Is that what you mean?

Mr. MACEY. I will say yes, and for this reason: If A went out there and located a placer mining claim, and by his own acts under the mining laws he has waived his rights, and knowingly or unknowingly; but after that someone else has come along, which he has a legal right to do if the mining law applied, he should have a right to present his case before the tribunal and should not be legislated out of court entirely.

Mr. BURTNESS. I recognize the force of that argument where the claim is made and that is the ground upon which they relied. But the decision of the court is that they had no legal right to rely upon that ground, and here is a bunch of other people who relied upon other features, which might not appeal to your mind or to my mind as strong from the viewpoint of the reasons why they relied upon them. Yet if we find, for instance, they did in good faith rely upon them, then if you make the provisions of the placer mining law the sole guide and the sole test, might not there be eliminated others who, in fact, are in as good faith as those to whom the mining law applied?

Mr. LARSEN. And especially would not this be true, that these claimants have to suffer so many hardships in trying to hold possession and as many of those people have been forced to suffer such hardships as to have been forced to part with it, if that condition existed, it looks to me as if the men who purchased what they had, provided they purchased in good faith, should be protected if they are protected at all under any remedial legislation.

Mr. MACEY. That brings up the next question of whether Congress should protect or not.

Mr. LARSEN. Otherwise, a man would not be able to push an original claim at all. The original settler might have died and his children, who would get his rights, would get no rights at all under the provisions you recommend?

Mr. MACEY. No; I would not say that.

Mr. LARSEN. I know you did not say that; but then that, in my opinion, would be the logical conclusion from your statement.

Mr. MACEY. I do not think that is the logical conclusion to be drawn from my statement. The view I take is this, that if you will pass a bill for general equitable relief, recognizing the fact that not a soul down there had any legal right whatever, and leave it to some judicial tribunal to determine the equities as they exist, I assume that everybody will get practically what they are entitled to.

Mr. LARSEN. I understood that you rather objected to the provisions of one of these bills, though, because it would do that very thing-it would enable them to grant that relief.

The CHAIRMAN. Does your objection go to the language in lines 8 and 9, "Leases and permits under this act shall be granted to the assignees”?

Mr. MACEY. I do not object to that; I object to the language in lines 18 to 24.

The CHAIRMAN. You do not object to the language in lines 8 and 9, that "Leases and permits under this act shall be granted to the assignees"?

Mr. MACEY. No. I read that because I wanted to read it in connection with the language in lines 18 to 24. You take the two together, and I think it is clear what the legal effect of that language would be.

Mr. BURTNESS. In other words, the lines you refer to would validate something which had become void, or at least subject to cancellation if the act were strictly applied?

Mr. MACEY. That is, it might do it; I do not know what the status of those people are. Mr. BURTNESs. It might do that?

Mr. MACEY. It might do that; if there are any of the claimants here in that position, then it would. Even then, it is not going to injure them in any way.

Mr. BURTNESS. That is, it sets up another test?

Mr. MACEY. Yes.

Mr. BURTNESS. In place of the test laid down in the mining law?

Mr. MACEY. The test it sets up is an entirely different test.

Mr. BURTNESS. The test it sets up is whether they were in possession and remained in possession until dispossessed, regardless of whether they were original locators or assignees.

Mr. MACEY. Yes.

The CHAIRMAN. Do you consider a mistake as to the right to assign more inexcusable than a mistake as to whether or not this land was open to entry?

Mr. MACEY. NO. Here is what I consider: If there are two people who have come in there and if the mining laws would apply, each one claiming title to the other's land, under the mining laws of the United States you would say one gets 50 acres and the other gets 30 acres, out of the same tract. And if the mining laws would apply, that is exactly what they would get. This legislation here might give one person the entire 80 acres and give the other nothing, even though he had an absolutely legal right if the mining laws applied. That is the point I raise.

Mr. VAILE. Mr. Macey, I asked Mr. Roote about the form of the assignments which had been made by the original locators who located the Burke Divide lands, and he said that they were really leases, the assignees retaining an interest in the form of royalties; but that they were in the form of quitclaim deeds, or on a blank which was headed "quitclaim deed." You have called attention to some statements made in the Senate hearings, in which they were spoken of as deeds or conveyances. Now can you enlighten us a little more as to your view of what those assignments really were?

Mr. MACEY. I do not know; no. I have never seen them.

Mr. BURTNESS. Assuming they were merely leases, in fact, regardless of what blank they may have been made on, what effect would that have had on the ability to validate the claim eventually, upon discovery?

Mr. MACEY. Upon making leases, where the people who owned the land could go ahead and validate, in that event the rights would be fully protected without using the language in lines 18 to 24 of this bill, section 2; they would be fully protected under the Sinnott bill.

Mr. BURTNESS. So that if they were not conveyances, in so far as that particular feature is concerned, then the language would not cut any ice?

Mr. MACEY. If they were not conveyances, the rights would be bound to be paramount. I understand there are lots of conflicts here, and, inasmuch as these things were done

Mr. BURTNESS. You want to have your clients in such a position that they could go in, if the facts warranted, and try to show those were, in fact, conveyances or absolute assignments and have them be in the position that the act of making them placed them in?

Mr. MACEY. I want my clients to be in this position: If they had a mining location or a tract of land down there which would, had the mining laws applied, been a valid claim, I want them protected; that is all. I want them protected in their rights.

Mr. BURTNESS. Now, in so far as point of time is concerned, so you concede that Varner and his associates, if I have that name right, and Crane and his associates, were all ahead of the people you represent?

Mr. MACEY. Yes, sir.

Mr. BURTNESS. That is conceded?

Mr. MACEY. That is conceded. The dates show that for themselves.

Mr. LARSEN. Mr. Macey, what would be your view regarding the proposition to give to each person, say, 5 acres surrounding every well that he drilled or where he had a derrick located at the time the property went into the hands of the receiver?

Mr. MACEY. I think the language in Mr. Sinnott's bill is better. Five acres is not enough. For instance, you give a man 5 acres of land out in the middle of that river, half a mile from the bank, and possibly he has got to build a road on to the tract out there to operate out in the water, and you have to take everything away out there, half a mile from the shore-he could not operate 5 acres withour going broke.

Mr. LARSEN. Assuming it would not be possible then, in every case, to allot to each party as much as 20 acres, without their allotments perhaps overlapping each other, then what would you do if such a condition as that should occur?

Mr. MACEY. I do not know what you would do, unless you left the matter-
Mr. LARSEN. Would you apportion it between them in some way?

Mr. MACEY. As the chairman of this committee stated, I would use the language in section 18 of the leasing law, that in cases of such conflicts the Secretary of the Interior is authorized to grant leases to one or more of them as shall be deemed just. Mr. VAILE. In other words, you would leave it to somebody to decide, if they can not agree?

Mr. MACEY. Yes. If two people have wells on a 10-acre tract and there is not enough land so that they can get 20 acres with each well, you would have to give them less, apparently, if they are in conflict. I do not know what else you could do, if they are both in good faith and both have equal equities.

Mr. LARSEN. We will assume that is true

Mr. MACEY. You have to cut it into tracts to meet that condition.

Mr. LARSEN. That is why I suggested 5 acres instead of 20.

Mr. MACEY. If you put the other paragraph in, I do not think that would be necessary.

Mr. LARSEN. You think 5 acres would be such a small allotment there would be very little relief from it?

Mr. MACEY. Very little.

Mr. BURTNESS. Do you know how much land an oil well would drain down in that country?

Mr. MACEY. NO; I do not. Those things are determined by the underlying structure of the sand that contains the oil, and the question of how close the wells are drilled depends very often on the extent you have to go down and the expense of drilling. But wells will drain through the years for a long ways. You can put one well on the top of an oil structure and no other well ever be drilled, and if the underlying thing that holds the oil structure is water, as the oil is taken off the water will go up and, of course, you can drain the whole field.

Mr. BURTNESS. But say an owner had 20 acres in the middle of a known field and he wanted to go in there and exhaust that tract within a reasonable time, how many welis would he ordinarily drill on the tract in order to do that; what is the maximum? Mr. MACEY. I should say down there, where the depth of the wells is from 1,700 to 2,000 feet, that they would drill four wells. He might get into a pocket and have to drill some offset wells.

Mr. BURTNESS. Are there any pockets out there on the Texas lands where offset wells have been drilled adjoining those lands down on the river bottom, at an early date?

Mr. MACEY. There certainly are. You have a strip of land there that is from a third to half a mile wide, and along the Texas side you have a row of derricks, I suppose, as thick as they can stick them up, draining that land all the time, and following the decision of the Supreme Court a week ago Monday you are going to find a string of derricks along the north side on the lands of the riparian owners, and after they drill down this side and up this side, in a couple of years you won't have any oil left to talk about at all. It is my opinion it is most essential to get legislation at the earliest practicable date on behalf of the Government and on behalf of these claimants who have claims there, or else the Government will lose whatever royalties it expects to get and the claimants will lose whatever equities they might have if Congress legislated.

legal way to prevent that?

Mr. LARSEN. And there is no Mr. MACEY. Absolutely not. They can drill a well right up to your line, almost, and there is no way to stop them. In certain fields they have rules and regulations to keep 150 feet away from the line. Of course, they work in harmony; but, if they do not work in harmony and do not do that, there is no one to stop them.

Mr. LARSEN. There is not any harmony in this section down there, or there has not been, from what I understand.

Mr. MACEY. From what I have heard before this committee, I assume the Texas people are trying to get the oil out of that country as fast as they can.

Now I would like to suggest to this committee, on behalf of the Denson Group, that they favor the Sinnott bill H. R. 12233. It seems to be a bill for the general equitable relief of all claimants, leaving to the department to determine what the equities are. The Secretary of the Interior has reviewed this matter in a very able opinion that was read here the other day, in the opinion of June 29, 1922, and the Department of the Interior itself seems to feel that these claimants are entitled to equitable relief. Perhaps he feels that more so than Mr. Dyar does.

The CHAIRMAN. Is that the letter addressed to the chairman?

Mr. MACEY. Yes. And the bill they submitted at that time has always seemed to me a fair bill, unless you can not trust the department or such a tribunal to do equity. Mr. BURTNESS. Do you think it is fair to limit the amount to 160 acres that might be granted to any corporation, regardless of how many claims originally have really centered in that corporation?

Mr. MACEY. I have heretofore expressed my opinion that I had no objection to the amendment suggested by the Secretary of the Interior on August 21, 1922. The copy I have is addressed to the chairman of the Senate committee, but I think you read the same report into the proceedings the other day, wherein he suggested an amendmentexcept in those cases where two or more locations or claims have been assigned to one person or corporation, and in such cases not more than 480 acres shall be granted by leases or permits to any one person or corporation.”

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Now that is the provision that has been carried into what is known as the Sanders bill here, 480 acres, and that meets with the approval of the department and presumably he may have felt satisfied if the Sinnott bill should have been amended to include that provision. With that amendment, as I say, we approve of the Sinnott bill; but if this committee prefers to act upon the Sanders bill, H. R. 13475, then I would like to suggest either one or the other of the following amendments:

Strike out lines 18 to 24, page 2, and insert in lieu thereof the following from section 18 of the leasing law:

“Provided, however, That in case of conflicting claimants for permits or leases under this act, the Secretary of the Interior is authorized to grant permits or leases to one or more of them as shall be deemed just."

The CHAIRMAN. What is that from which you are reading?

Mr. MACEY. This is the language you referred to, section 18 of the leasing law, with a change of one or two words.

Mr. VAILE. He is suggesting, with that amendment, the Sanders bill would be satisfactory.

Mr. MACEY. I am suggesting striking lines 18 to 24 and inserting the language of the leasing act. Or, assuming that you would not strike lines 18 to 24, but leave the entire paragraph 2 as it stands, I would suggest adding the following:

"Provided, however, That no claimant whose claim is based upon a placer mining ocation shall take, under this act, more land than he or it would have taken had the United States mining laws been held by the United States Supreme Court to apply to said land."

Either of those amendments would be satisfactory; either the Sinnott bill, with the 480-acre provision included, if the committee so desires, or the Sanders bill with either of those amendments, would cover the situation, it seems to me.

I am not here to criticise anybody, but I am here to protect any rights and such equities as the Denson group have. If they have none, of course, that is all rightthey will go hence and take nothing; if they have, I would like to have an opportunity to present them. I do think it is important, as I said before, for the reasons stated, to