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                                                     No. 96-16480
                                                     D.C. No.

Appeal from the United States District Court
for the District of Arizona
Stephen M. McNamee, District Judge, Presiding

Argued and Submitted
June 12, 1997--San Francisco, California

Filed December 28, 1999

Before: Joseph T. Sneed and Andrew J. Kleinfeld,
Circuit Judges, and Evan J. Wallach.1

1 The Honorable Evan J. Wallach, Judge of the United States Court of
International Trade, sitting by designation.

Opinion by Judge Kleinfeld;
Concurrence by Judge Wallach



Arthur E. Lloyd, Payson, Arizona, for the defendants-

Robert Bartels, Assistant United States Attorney, Phoenix,
Arizona, for the plaintiff-appellee.



KLEINFELD, Circuit Judge:

This is a mining law case. Issues arise regarding the extent
to which the owner of an unpatented mining claim or mill site
has surface rights despite the absence of approval of his oper-
ating plan or bond, and also the constraints on disapproval.


Ray and Molly Shumway own seven mill sites in the Tonto


National Forest in Arizona. Two of the seven mill sites, BLM
claim numbers AMC 203225 and 209240, are the subject of
this lawsuit. The mill sites were held pursuant to mill site
claims. Mining claims and mill site claims, in mining law ter-
minology, are vested possessory rights which are recognized
as interests in real property; they are not merely assertions of
rights, as claims are in the more common sense of the word.
Because this case was decided on summary judgment, the
facts, where disputed, are taken most favorably to the Shum-
ways based on the cognizable evidence submitted on the sum-
mary judgment motions.2

The mill sites are subject to Forest Service operating plan
approval because they are in a national forest. 3 Approvals of
the Shumways' plans of operations have been repeatedly
granted. The first approval in the record was in 1979, for
1979-80. In its 1981 approval, the Forest Service approved a
cyanide leaching operation on the sites (cyanide combines
usefully with gold and silver, so is used extensively to extract
those valuable metals from their ores). The Forest Service
required the Shumways to have someone live on site to dis-
courage vandalism.

Friction appears to have begun between the Shumways and
the Forest Service in the late 1980s. Mr. Shumway states in
his affidavit that a Mr. Rodney Byers of the Forest Service
came to the district and told him that he "would try to figure
out a way to get me off of" his claims before patents for
which Mr. Shumway had applied were issued. In 1987, the
Forest Service directed Shumway to stop stabling a horse on
the property, and clean up trash and junk. But Mr. Shumway
felt he needed the horse to inspect the perimeter of his mill-
sites and to inspect mines in the forest, because no motor
vehicles were allowed. Mr. Shumway states in his affidavit
that "[a]ll of the equipment and materials stored on the mill-
2 See Berry v. Valence Tech., Inc. , 175 F.3d 699, 703 (9th Cir. 1999).
3 See 36 C.F.R. 228.4 (1998).


sites have been or were incidental to the milling operations."
That same year, the Forest Service ordered the Shumways out
of their home in a travel trailer on one of the sites, though in
1981 it had required that someone live there to guard against
the risk of vandalism. No more cyanide leaching was taking
place by then, which had been the Forest Service's stated rea-
son for requiring residence on the site, but other chemicals
were being used.

The Forest Service also changed its bond requirements with
respect to the Shumway mill sites. The operating plan
approved in 1979 required the Shumways to post a $2,000
cash or surety bond to assure eventual reclamation of the dis-
turbed area. In 1980, the Forest Service increased the required
performance bond to $3,200. The $3,200 amount was
approved again in 1981. By 1990, the bond amount had crept
up to $5,200, although less ore was being processed than in
the 1980s and no cyanide leaching was taking place. But in
1990, the Forest Service raised the required bond to $18,000.

The Shumways submitted a corporate surety bond, ade-
quate in amount, from Globe Insurance Company, Ltd., but
the Forest Service rejected the bond because Globe was not
listed by the Department of the Treasury as an accepted
surety. The Shumways unsuccessfully appealed the increase
in the bond requirement and were unable to post it. They
found that no sureties on the Department's approved list were
writing such bonds, and they did not have $18,000 cash they
could spare from the milling operations. In 1991, the Forest
Service ordered them to stop all milling and mining and leave
their residence on the mill site, because they had not posted
the bond. The Forest Service subsequently advised the Shum-
ways that if they tried to obtain approval for a new operating
plan, they could expect the bond to be raised to $150,000 or

Meanwhile, the Shumways, in 1994, applied for patents to
their mill sites. A "patent" "is the conveyance by which the


[federal government] passes its title to portions of the public
domain."4 A patent does not merely pass title, like a deed, but
operates as an official declaration of title which is, with lim-
ited exceptions, unassailable and not rebutable.5 The Shum-
ways duly recorded, posted, and published notice. The
Secretary of the Interior had, in 1993, revoked his delegation
of authority to the Bureau of Land Management to sign the
critical document preceding a patent, the "First Half of the
Mineral Entry Final Certificate," so the Shumways' papers
were forwarded to the Secretary himself. On December 1,
1994, the Secretary of the Interior personally signed the First
Half-Mineral Entry Final Certificate for the mill sites at issue
and five other Shumway claims.

The Department then advised the Shumways that a patent
would issue "if all is found regular and upon demonstration
and verification of use and/or occupancy." This would be ver-
ified "by a mineral examiner in an on-the-ground
examination." But the Shumways' case file was not assigned
by the Department to a mineral examiner. As of the summer
of 1995, the Arizona BLM was proceeding with only two
field examinations, and those had been requested seven and
eight years before. There were eleven more to go before the
BLM got to the Shumways' field examination.

In 1995, the United States sued the Shumways to evict
them from the two mill sites, and require them to remove all
their things and clean the sites up. The Complaint alleges that
the Shumways were not conducting any milling at the mill
sites, had no approved plan of operations, had failed to post
the required bond, and were trespassing. The district court
granted summary judgment in favor of the government, order-
ing the Shumways to remove themselves and all their things
from the sites and to restore the sites to their natural condi-
tion, or if they did not, they would forfeit the sites and be
4 Smelting Co. v. Kemp, 104 U.S. 636, 640 (1881).
5 Id. at 640-41.


required to pay damages sufficient to restore the sites. The
Shumways appeal.


It is hard to understand this dispute about a relatively
arcane area of law without reference to history. During the
first half of the nineteenth century, the United States estab-
lished a mineral leasing system, so that the government would
realize much of the economic benefit of minerals found on
public lands. But President Polk reported to Congress in 1845
that the cost of government administration was more than four
times the lease income, and the leasing system was abandoned.6
The California gold rush in 1849 took place without much law
to guide it, so the miners developed their own rules and cus-
toms. They evolved in the miners' meetings, which were used
to govern mining camps before any official government
existed at these remote locations. Among the earliest success-
ful prospectors in the 1849 California gold rush were experi-
enced miners from Cornwall, England, Chile, participants in
the Dahlonega, Georgia gold rush of 1829, and other experi-
enced prospectors and miners, who already knew something

about what practical rules were needed.7  That the rules were
so successful may reflect this combination of practical experi-
ence with considerable learning, for "[i]n 1849 hardly a camp
existed on the great Sierra slope that did not contain miners
who were graduates of colleges and law-schools or were law-
yers of considerable experience."8
6 See John C. Lacy, Historical Overview of the Mining Law: The Min-
ers' Law Becomes Law, in The Mining Law of 1872: A Legal and Histori-
cal Analysis 16-17 (1989).
7 See Charles Howard Shinn, Mining Camps -- A Study in American
Frontier Government 38-39 (Knopf ed. 1948) (1885); see also Charles
Wallace Miller, Jr., Stake Your Claim!: The Tale of America's Enduring
Mining Laws 16-17 (1991).
8 Shinn, supra note 14, at 168.


The miners' meetings operated as might be expected of a
highly democratic process. They favored the interests of those
who were there--mostly individuals and small firms without
much capital. A much more centralized governmental process
in Washington might have favored those with influence in the
national government--perhaps those who might want to max-
imize federal revenue, preserve federal lands, or protect large
firms from having to pay huge amounts to buy claims from
small scale prospectors who discovered minerals but lacked
the capital to extract them.

Other approaches were possible, and might have com-
mended themselves to people with different interests. Justice
Field took the position, to the great displeasure of the miners,
that under the common law after Alta California became
American, minerals passed to the owner of the land, so that
the miner could not invade land privately held. 9 Another alter-
native might have been the Mexican, based on the Spanish
custom, whereby the sovereign was entitled to a royal share,
or royalty, of one fifth of the gold.10  Yet another approach
might be the English, where unlike the Spanish quinto, if any
gold or silver was found in a mine the king was entitled to the
whole, at least if the precious metals were worth more than
the base metals (though by two statutes of William and Mary,
the king allowed the owner to keep the mine provided that the
gold and silver must be sold to the king for the value of the
tin in the ore).11 In the American gold rushes in the West, the
miners made the rules, so the miners made the money. This

stimulated a great deal of successful mining.

Even though most of the gold in the California and other
western gold rushes was found on federal land, the federal
9 Stephen J. Field, The Annoyances of My Judicial Life 135 in Personal
Reminiscences of Early Days in California (1893 2d ed.) (1877).
10 Miller, supra note 14, at 2-3.
11 1 William Blackstone, Commentaries on the Laws of England 284-85


government adopted a mining law scheme late, long after the
customs of ownership by discovery and extraction had been
established. The California gold rush of 1849, Colorado in
1859, the Comstock Lode and other strikes in Nevada in
1859-60, Idaho in 1862-63, Montana in 1863, and quite a few
others, all preceded the federal mining laws. As in the soft-
ware industry in the 1990s, the industry developed, many vast
individual fortunes were made, and the national wealth was
greatly increased, all by a new kind of property, before much
of the legal framework for the industry developed.

When it came, in skeletal form in 1866, and in substantially
its current form in the Mining Law of 1872, the federal statu-
tory law of mining "received" customary law in much the
same way that the states had received the common law. The
statute, still in force, says "all valuable mineral deposits" in
federal lands "shall be free and open to exploration and
purchase" under prescribed regulations "and according to the
local customs or rules of miners in the several mining dis-
tricts, so far as the same are applicable and not inconsistent
with the laws of the United States."12  Thus, instead of follow-
ing any of the alternative schemes, which might have pre-
served more government authority or revenue, Congress
expressly adopted the "local customs or rules of the miners."
The most important of those customs created a property right
based on discovery and extraction of valuable minerals, in the
absence of any title. Thus, the history of mining customs has
unusual relevance because in this area, as Faulkner said, "the

past isn't dead--it isn't even past."
12 30 U.S.C. S 22 (1994).Cf. Alaska Stat. S 01.10.010 (Lexis 1998) ("So
much of the common law not inconsistent with the Constitution of the
State of Alaska or the Constitution of the United States or with any law
passed by the legislature of the State of Alaska is the rule of decision in
this state."); Cal. Civ. Code S 22.2 (West 1982) ("The common law of
England, so far as it is not repugnant to or inconsistent with the Constitu-
tion of the United States, or the Constitution or laws of this State, is the
rule of decision in all the courts of this State.").


Despite much contemporary hostility to the Mining Law of
1872 and high level political pressure by influential individu-
als and organizations for its repeal, all repeal efforts have
failed, and it remains the law.13 The miners' custom, that the
finder of valuable minerals on government land is entitled to
exclusive possession of the land for purposes of mining and
to all the minerals he extracts, has been a powerful engine
driving exploration and extraction of valuable minerals, and
has been the law of the United States since 1866. Mill site
claims, which are ancillary to mining because grinding the ore
is often necessary to extracting the valuable minerals, follow
substantially the same rules as mining claims.14

"A mineral claim is a parcel of land containing precious
metal in its soil or rock."15 Under the Mining Law of 1872,
there are three stages in patenting a mining claim. The first
stage is "location" of a claim. "A location is the act of appro-
priating such a parcel,"16 generally by posting notice on the
ground. "The locators of all mining locations . .. so long as
they comply with the laws . . . shall have the exclusive right
of possession and enjoyment of all the surface located within
the lines of their locations, and of all veins,[and] lodes
. . . ."17

At the second stage, the prospector is required to perform
improvements or assessment work. "[U]ntil a patent has been
13 See, e.g., Sen. Dale Bumpers, Reform of the 1872 Mining Law, in The
Mining Law of 1872: a Legal and Historical Analysis  7 (1989); Associ-
ated Press, Babbitt Calls Mining Law "Outrageous Gift," The Denver
Post, May 15, 1997, at B8; Miller, supra note 14, at 238-246 (stating that
environmental organizations and large mining companies have favored
replacement of Mining Law of 1872 with leasing scheme, but the "little
man" has so far succeeded in mobilizing sufficient political strength to
prevent change).
14 See 30 U.S.C. 42(a) (1994).
15 St. Louis Smelting & Ref. Co. v. Kemp, 104 U.S. 636, 649 (1881).
16 Id.
17 30 U.S.C. S 26.


issued therefor, not less than $100 worth of labor shall be per-
formed or improvements made during each year." 18 Third, the
prospector may apply for a patent. A person who has
"located" a mining or millsite claim can apply for a patent
(the term for a government conveyance of title to an individ-
ual of public land) with the Bureau of Land Management,
show compliance with the laws regarding location, post notice
of application, and file proof of notice.19 After further publica-
tion of notice, the applicant files papers showing that the req-
uisite labor has been expended on the claim and that the
description is correct, and further proof of the requisite publi-
cation of notice.20 At that point, if no adverse claim has been
filed, "it shall be assumed that the applicant is entitled to a
patent" upon payment of a nominal fee, unless it is shown that
the applicant has failed to comply with the mining laws.21 A
mill site is patented the same way.22

[1] As the Bureau of Land Management's 1991 internal
manual explains the mill site procedure, "mill sites must be
used or occupied for mining and milling purposes only, or
uses reasonably in support of mining and milling purposes as
commonly recognized in the mining industry." 23 The manual
says that issuance of the "First Half of the Final Certificate,"
such as the Shumways obtained, "confirms equitable title is
vested in the applicant, subject to the confirmation of a dis-
covery of a valuable mineral deposit by a mineral examiner,"24
certifies that the applicant "has satisfactorily complied with
18 30 U.S.C. S 28.
19 30 U.S.C. S 29.
20 Id.
21 Id.
22 See 30 U.S.C. S 42(a).
23 BLM Manual, release 3-270, Millsite Claim Patent Applications
S 3864.1(F).
24 Id. at ch. 6(A)(2).


all `paperwork requirements," and "eliminates the need for
performance of assessment work."25

[2] In ordinary English, a "claim " is merely a demand for
something, or an assertion of a right where the right has not
been established. The phrase "mining claim" therefore proba-
bly connotes to most laymen an unsupported assertion or
demand from which no legal rights can be inferred. But that
is emphatically not so. In law, the word "claim" in connection
with the phrase "mining claim" represents a federally recog-
nized right in real property. The Supreme Court has estab-
lished that a mining "claim" is not a claim in the ordinary
sense of the word--a mere assertion of a right--but rather is
a property interest, which is itself real property in every sense,
and not merely an assertion of a right to property. Benson
Mining & Smelting Co. v. Alta Mining & Smelting Co. 26 held
that once the owners of a mining claim applied for a patent
and paid the fees, and the right to a patent existed, they had
"full equitable title,"27 and their failure to do subsequent
annual work on the claim did not reopen it to subsequent loca-

tion by another. "[O]nly the naked legal title remains in the
government, in trust for the [applicant], in whom are vested
all the rights and obligations of ownership." 28

[3] The question in Bradford v. Morrison29 was whether
unpatented mining claims are real property. The Court held
that the unpatented "title of a locator" is "property in the ful-
lest sense of the word," noting that unpatented mining claims,
at that time, "constitute[d] very largely the wealth of the
Pacific Coast states."30 In United States v. North American
25 Id.
26 Benson Mining & Smelting Co. v. Alta Mining & Smelting Co., 145
U.S. 428 (1892).
27 Id. at 434.
28 Id. at 432.
29 Bradford v. Morrison, 212 U.S. 389 (1909).
30 Id. at 394.


Transportation & Trading Co.,31 the Army had been sent to
Nome to bring order during its gold rush, and the president
established a federal reservation for the Army base. The
Court, in an opinion by Justice Brandeis, held that a company
holding a mining claim at the site was entitled to compensa-
tion for the taking, with interest from the date of the reservation.32
This case establishes that the government cannot reserve its
own land from an unpatented mining claim without paying
the owner the value of the claim, because an unpatented min-
ing claim is property.

In 1920, oil, oil shale, gas and certain other minerals were
carved out of the Mining Law of 1872 and subjected to a fed-
eral leasing system, with a saving clause protecting "valid
claims existent [at the date of the passage of the Act]." 33
Wilbur v. United States ex rel. Krushnic34 involved a dispute
between the Department of the Interior and persons who had
located a placer claim to oil shale before the new mineral
leasing act. After the new leasing law had gone into effect, the
locators completed the required annual labor and applied for
a patent.35 Like Mr. and Mrs. Shumway, they received what
is now called the First Half Final Certificate. 36 The Depart-
ment refused to issue a patent because the annual assessment
work had not been done during one of the necessary years,
and was resumed only after the new statute made oil shale
placer claims unavailable for patent.37

The Court ordered issuance of a writ of mandamus anyway,
31 United States v. North Amer. Transp. & Trading Co., 253 U.S. 330
32 See id. at 337-38.
33 30 U.S.C. S 193.
34 Wilbur v. United States ex rel. Krushnic, 280 U.S. 306 (1930).
35 See id. at 315.
36 See id.
37 See id.


holding that failure to perform the assessment work did not
"forfeit" the claim, but only subjected it to the risk that some-
one would locate over it, a risk averted when the original
locator resumed work.38 This decision probably had much to
do with the mining industry custom of operating on the basis
of claims without obtaining patents, because it rendered pat-
ents (and the miner examiners', surveyors', lawyers', and
other fees to obtain them) unnecessary. "[W]hen the location
of a mining claim is perfected under the law, it has the effect
of a grant by the United States of the right of present and
exclusive possession. The claim is property in the fullest
sense of that term . . . ."39 The Court held that the owner of
a perfected mining claim "is not required . . . to secure patent
from the United States; so long as he complies with all provi-
sions of the mining laws, his possessory right, for all practical
purposes of ownership, is as good as though secured by patent."40

In 1955, Congress dealt with the problem of sham mining
claims used for other purposes. Sham claims could be used
for selling timber from national forests, or obtaining free resi-
dential or agricultural land; one decision has suggested sham
use of mining claims along streams by non-serious prospec-
tors (but serious fishermen) "to enjoy their own private fish-
ing camp."41 The Multiple Use Act provides that "a mining
claim shall not be used, prior to issuance of patent therefor,
for any purposes other than prospecting, mining or processing
operations and uses reasonably incident thereto."42 Mining
claims located after the effective date of the 1955 Act are sub-
ject, prior to issuance of patent, to a right of the United States
to manage surface resources and for the government and
whomever it permits to do so to use the surface, so long as
38 See id. at 317.
39 Id. at 316.
40 Id. at 317.
41 United States v. Curtis Nevada Mines, Inc., 611 F.2d 1277, 1282 (9th

Cir. 1980).
42 30 U.S.C. S 612(a).


they do not endanger or materially interfere with prospecting,
mining, or processing.43 Pursuant to that statute, we held that
where mining activity was limited to a caretaker watching
after equipment, the government could permit public recre-
ational use of roads crossing unpatented mining claims.44

We considered an action by the government for trespass
and an injunction, like the one in the case at bar, in United
States v. Goldfield Deep Mines Co.45  The government pre-
vailed, the company having damaged national forest land
extensively without filing a plan of operations. 46 But the case
differed from the case at bar in a critical respect: there had
already been an administrative adjudication that Goldfield had
no valid mining claim, because there were no significant
minerals.47 The claim was a sham. In the case at bar, there has
been no determination of whether prudent persons would
establish a mill site in the Shumways' location. The record in
this case does not permit summary judgment on the basis that
the claims are a sham.

In Swanson v. Babbitt,48 Congress had passed a law prohib-
iting issuance of new patents to mining claims in the Saw-
tooth National Recreation Area. The appellants, who had
applied prior to the new act for patents to several mining and
millsite claims, challenged the law as unconstitutional, on the
ground that his right to a patent had already vested. We noted
that "an unpatented mining claim remains a fully recognized
possessory interest,"49 and that "[f]ederal mining claims are
43 See 30 U.S.C. S 612(b).
44 See Curtis-Nevada Mines, 611 F.2d at 1284.
45 United States v. Goldfield Deep Mines Co., 644 F.2d 1307 (9th Cir.
46 See id. at 1308.
47 Id. at 1308 n.2.
48 Swanson v. Babbitt, 3 F.3d 1348 (9th Cir. 1993).
49 Id. at 1350.


`private property' which enjoy the full protection of the Fifth
Amendment."50 But in Swanson (unlike the Shumways' case)
the Bureau of Land Management had challenged the validity
and scope of the claims, and we noted that for patent rights
to vest upon application, the application had to be valid, and
no right arose from an invalid claim.51  As long as the claimant
had complied with applicable claims laws until filing, failure
to adhere to regulations after filing could not invalidate his
claim, but where the Secretary contested the claim in good
faith and not for purposes of delay, then the delay was not
merely ministerial but resulted from the challenge, and the
right to a patent did not vest until resolution of the challenge,
which came after the effective date of the Act. 52 Under
Swanson, a mining claimant may be without a right to receive
a patent if there is a good faith dispute as to its validity though
he would have a vested right if the only reason he has not
received his patent is administrative delay by the Secretary.


The Shumways argue that their equitable title in the mill
site claims entitles them not to be treated as trespassers, the
increase in their bond requirement to $18,000 and then at least
$150,000 if they were to get approval of a new operating plan
was impermissible, and that the district court improperly
rejected their evidence on summary judgment. We review de
novo because the case was decided on summary judgment.53


The Shumways argue that because they had received the
First Half Final Certificate toward their patent, they had equi-
table title to the real estate inconsistent with the district court
50 Id. at 1353.
51 Id. at 1353.
52 Id. at 1354.
53 See Burrell v. Star Nursery, Inc., 170 F.3d 951, 954 (9th Cir. 1999).


determination that they were trespassers. The government
argues that issuance of the First Half Final Certificate estab-
lished only that the Shumways had filed their papers applying
for a patent, not that they were entitled to a patent or posses-
sion. To decide the case, it is necessary to figure out just what
the Shumways owned.

[4] The Shumways argue that their right to a patent has
vested, because they have done all that they are obligated to
do in order to receive one, and the delay in issuance is attrib-
utable merely to administrative delay. In this argument, they
are incorrect. There is a presumption that they are entitled to
a patent, because, as explained above, the statute provides that
"it shall be assumed"54 that they are entitled to a patent now
that the First Half of the Final Certificate has been issued. But
the presumption is rebuttable, as the statute provides in the
phrase "unless it is shown that the applicant has failed to com-
ply with the mining laws."55 If the Shumways were entitled to
a patent at the time they applied, then it is true that as of that
time they have had "full equitable title" with the government
retaining "only the naked legal title" in trust for them and sub-
ject to their fully vested rights and obligations of ownership.56
But that is true only if the right to a patent existed. Were the
Secretary to have challenged, in good faith, the Shumways'

compliance with the mining laws, then under our decision in
Swanson they would not have a vested right to issuance of the
patent until resolution of the challenge.57

[5] The government argues that until the Secretary of the
Interior has decided that a patent application is valid, the
applicant has no vested rights at all, even if the applicant is
in compliance with the mining laws and the Bureau of Land
Management has so found. That is also incorrect. It has long
54 30 U.S.C. S 29 (1994).
55 Id.
56 Benson Mining, 145 U.S. at 432.
57 See Swanson, 3 F.3d at 1353.


been established that if the applicants are in compliance with
the mining laws, then their right to the unpatented claim, or
the "title of a locator" is vested even though the Department
of the Interior has as yet taken no action at all on their appli-
cation for a patent.58 That an applicant has yet to receive, or
even apply for, a patent does not mean that the government
has plenary power over the mill site.

[6] The owner of a mining claim owns property, and is not
a mere social guest of the Department of the Interior to be
shooed out the door when the Department chooses. Rather,
pursuant to the Multiple Use Act, the Department must con-
tinue to co-exist with a holder of a valid claim whose right to
possession has vested. Therefore, so long as the Shumways
complied with mining law and forest service regulations, they
were entitled to the possessory right and title of a locator--a
right to possess the mill site--and could not be evicted unless
their claim was a sham or otherwise invalid or they failed to
observe Forest Service regulations in such a way as to invali-
date their claim. The Forest Service does not argue that the
Shumways did not have a bona fide mill site claim, so the rest
of our inquiry will focus on whether the Shumways failed to
comply with permissible Forest Service requirements in such
a way as to invalidate their possessory rights.


[7] Even if the Shumways' right to a patent has not vested,
they may still defeat a motion for summary judgment, if they
demonstrate that the Forest Service raised the bond require-
ments arbitrarily, and unreasonably circumscribed their mill-
ing operations. To determine whether the Shumways have
raised a sufficient factual dispute to defeat summary judg-
ment, we must first revisit the district court's review of the
58 See Bradford, 212 U.S. at 394-95; Wilbur, 280 U.S. at 316.


A. The district court's treatment of the evidence.

[8] The Shumways argue that the district court erred in
treating as undisputed the Forest Service's claims that their
mill sites had changed, were strewn with junk, and that
cleanup would cost $150,000. The district court rejected Mr.
Shumway's affidavit on the ground that it was "self-serving
and conclusory" and rejected an affidavit by a Mr. Clay Rich-
ard Thorne on the ground that he failed to allege personal
knowledge. The district court said that the Shumways had
submitted "no evidence" contradicting the government's evi-
dence that much of the material on the mill sites was "scrap
or junk." This evidence was material both to whether the For-
est Service had authority to order the Shumways to remove
the material, and to the amount of a reasonable bond. Because
the Shumways had a possessory right to their mill sites, they
were not only permitted, but until their right to a patent
vested, required to use and occupy the mill sites for milling
purposes,59 and were entitled to have a residence, equipment,
materials, tools, and other property on the site incident to

milling operations.60

[9] Regarding the things on the property, the district court
was bound, on summary judgment, to determine only whether
there was a genuine issue of material fact, and was not
empowered to weigh the evidence or determine the truth of
the matters asserted.61 When a respondent to a motion for
summary judgment submits proper affidavits by individuals
with personal knowledge and other cognizable and signifi-
cantly probative evidence, such that a reasonable juror draw-
59 30 U.S.C. S 42 (1994); United States v. Bagwell, 961 F.2d 1450,
1455-56 (9th Cir. 1992).
60 See 30 U.S.C. S 612(a) (1994) (stating that mining claim shall be used
only for "prospecting, mining, or processing operations and other uses rea-
sonably incident thereto").
61 See Fed.R.Civ.P. 56(c); Summers v. A. Teichart & Son, Inc., 127 F.3d
1150, 1152 (9th Cir. 1997).


ing all inferences in favor of the respondent could return a
verdict in the respondent's favor, the judge must treat that fact
as genuinely at issue.62

[10] Mr. Shumway's affidavit was of course "self-serving,"
as the district court noted. And properly so, because otherwise
there would be no point in his submitting it. That an affidavit
is self-serving bears on its credibility, not on its cognizability
for purposes of establishing a genuine issue of material fact.
If the affidavit stated only conclusions, and not "such facts as
would be admissible in evidence,"63  then it would be too con-
clusory to be cognizable, but Mr. Shumway's affidavit was
not inadmissible for failure to state facts. It does state facts.

[11] Mr. Shumway swears in his 1995 affidavit to a number
of material facts for which personal knowledge and compe-
tence is established by the affidavit. He says "the operations
conducted on my mill sites have not substantially changed
over the last 15 years," and "I process ore on a regular basis
at the mill site in the same manner I have done for the last 15
years." As to the things on the site, he says "All of the equip-
ment and materials stored on the mill sites have been or were
incidental to the milling operations including my horse which
I use to ride the perimeter fence of my mill sites and to ride
into the wilderness (no vehicles are allowed) to inspect mines
that are in the wilderness area." These statements are all "such
facts as would be admissible in evidence" on Mr. Shumway's
testimony, so the district court erred in disregarding them.
They must be taken as true for purposes of determining
whether there is a genuine issue of fact precluding summary

[12] As for Mr. Thorne, he established competence as an
expert witness on some matters and personal knowledge on
62 See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986);
Summers v. A. Teichert & Son, Inc., 127 F.3d 1150, 1153 (9th Cir. 1997).
63 Fed. R. Civ. P. 56(e).


others. He says in his affidavit that he is the president of an
environmental consulting, cleanup and testing firm, has mined
himself in the same area since the early 1970s, has testified
in state and federal courts as a mining expert, and personally
inspected the Shumway millsite with a Stanford University
biochemist he employs. He swears that "I have personally
processed many tons of ore from my own mining operations
through the Shumway millsite," and "I have personal knowl-
edge that many other mining interests in the area have utilized
the Shumway millsite for processing or assaying of their ore."
As to the alleged junk, Mr. Thorne says "I have inspected the
equipment located on the Shumway millsite and in my esti-
mation the usable mining equipment alone has a replacement
value for mining purposes of no less than $400,000. " After
describing his familiarity with the Shumway mill sites "since
their inception," Mr. Thorne says "there has been no substan-
tial change whatsoever in the Shumway millsite operation nor

has there been any increase in environmental damage at all for
the past several years." As to the tailing ponds, Mr. Thorne
says "I have personally inspected the terrain " and states and
explains his opinion that there is little if any risk of environ-
mental contamination because of where they are located, even
considering the 100 year flood level. He says the chemicals
are properly stored, and hazardous chemicals are used only in
the laboratory, which is "properly constructed with a cement
floor." All this is based on what Mr. Thorne swears in his affi-
davit he saw with his own educated eyes. His affidavit shows
"affirmatively that the affiant is competent to testify" to these
matters and that it is "made on personal knowledge."64 The
district court therefore erred in disregarding it.

The Shumways also submitted evidence attached to their
brief on appeal, showing that in contrast to the government's
new estimates of $150,000 to $200,000 to clean up the site,
75 to 100 times the original bond requirement, they had
obtained an actual bid to do the work for $13,115. Because
64 Fed. R. Civ. P. 56(e).


this was not submitted to the district court when it considered
the summary judgment motion, it can have no bearing on
whether the district court erred.65 We therefore decide the case
without considering it. The evidence erroneously excluded
matters, as we explain below.

B. The Forest Service requirements.

The Shumways argue that the Forest Service has exceeded
its authority by raising the bond requirements arbitrarily and
unreasonably circumscribing their milling operations. The
record establishes a genuine issue of fact as to whether this is

The owner of a mining or mill site claim does not need a
patent, or a vested right to issuance of a patent, to possess and
use the property for legitimate mining or milling purposes. A
mining or mill site claim is "property in the fullest sense of
the word."66 Despite the absence of a patent, the government
cannot take the a valid mining claim for public use without
paying compensation.67 The owner of a perfected mining or
mill site claim "is not required . . . to secure patent from the
United States; but so long as he complies with all provisions
of the mining laws, his possessory right, for all practical pur-
poses of ownership, is as good as though secured by patent."68

Mining claims located after the effective date of the 1955
Multiple Use Act are subject, when a patent has not yet
issued, to a right in the United States to manage surface
resources and allow others to use surface resources, though
these uses "shall be such as not to endanger or materially
interfere with prospecting, mining or processing operations or
65 See USA Petroleum Co. v. Atlantic Richfield, Co., 13 F.3d 1276, 1279
(9th Cir. 1994).
66 Bradford, 212 U.S. at 394.
67 See North Amer. Transp., 253 U.S. at 334.
68 Wilbur, 280 U.S. at 316.


uses reasonably incident thereto."69  The Shumways do not
contest applicability of the Multiple Use Act, and concede for
purposes of this appeal that their millsite claims are subject to
the right of the United States to manage the surface resources
within the limitations of the Act. What the Shumways do con-
test is whether the Forest Service has stayed within the limita-
tions of the Act.

1. Circumscribing activity on the mill site.

[13] The Multiple Use Act empowers the Forest Service to
regulate non-mining activity upon mining claims, so long as
the non-mining activity does not interfere with mining activi-
ties or "uses reasonably incident thereto." 70 The Forest Ser-
vice has required the Shumways to remove their horse,
residential trailer, and "junk." The Shumways apparently have
removed the horse, which Mr. Shumway used to reach parts
of his claim not accessible by road, but claim that the trailer,
equipment, and materials are necessary in his milling opera-
tion. The Forest Service itself asked the Shumways to live on
the site for security purposes when there was cyanide being
used in the mill site operations. The Shumways claim there is
a continued need for security on the site to prevent vandalism
of their equipment. They have established a genuine issue of
fact in this respect.

[14] As to the equipment, or the "junk" as the Forest Ser-
vice refers to it, the Shumways have also established a factual
issue for trial. While the Forest Service might regard the
equipment on the Shumways' sites as junk, it has not proved
it. The Shumway affidavit establishes a genuine issue as to
whether the equipment and materials are incidental to his
milling operations. The Thorne affidavit establishes a genuine
issue by providing evidence that the Shumways have
69 30 U.S.C. S 612(b).
70 Id.


$400,000 worth of equipment, a proper laboratory properly
used, and properly stored valuable chemicals.

The Forest Service's own evidence in some respects estab-
lishes a genuine issue in favor of the Shumways. In particular,
the Forest Service's photographs, submitted to show the
"junk," display much that plainly is not. For example, a pho-
tograph of a pile of tires is submitted to show "junk." But to
anyone who drives much on bad, unpaved roads, what is nota-
ble about the tires is that they are mounted on intact steel
wheels. Such mounted tires have a use, and a market among
those who operate vehicles in terrain where flats are frequent
and bent wheels not unusual. Those of us who occasionally
drive on mining roads buy them, to have a couple of extra
mounted spares. If the Shumways drive the rigs shown in the
exhibits, then it is extremely plausible as Mr. Shumway says
in his affidavit, that these mounted tires are equipment inci-
dental to his milling operations. That the Forest Service calls
what appear to be good wheels "junk" may reflect a lack of
competence on its part to evaluate other people's equipment,

rather than a lack of value of the equipment.

Likewise, the Shumways have established a genuine issue
about whether their trailer is "junk" that should be removed
or a dwelling reasonably incident to mill site activity for
which their claim is held. The Shumways' evidence estab-
lishes that (1) they mill at the mill site, which would give
them a reason to live there, just as a grocer may have a reason
to live upstairs from the store; (2) the Forest Service previ-
ously ordered them to have someone living there, to protect
against vandals who might spill cyanide; and (3) even though
they no longer use cyanide, they still need security to protect
the site from vandals. That a sham mining claim cannot fur-
nish legal basis for a dwelling site does not imply that a
dwelling is not reasonably incident to a genuine mine or mill
site. The need of humans to eat, sleep, and relax in the remote
locations where mines have often developed has always
necessitated mining camps, bunkhouses, and other dwellings.


2. The plan of operations and the bond requirement.

As required by the Forest Service's organic act, the Secre-
tary of Agriculture was delegated the authority to promulgate
regulations for the protection of the forests:

      The Secretary of Agriculture shall make provisions
      for the protection against destruction by fire and dep-
      redations upon the public and national forests which
      may have been set aside . . . ; and he may make such
      rules and regulations and establish such service as
      will insure the objects of such reservations, namely,
      to regulate their occupancy and use and to preserve
      the forests thereupon from destruction.71

That same organic legislation limited that power, requiring
that no such rule or regulation "prohibit any person from
entering upon the national forests for all proper and lawful
purposes, including that of prospecting, locating and develop-
ing the mineral resources thereof."72  "Such persons must com-
ply with the rules and regulations covering such national
forests."73 Interpreting thesestatutes in United States v. Weiss,74
we held that the Secretary may adopt reasonable rules and
regulations which do not impermissibly encroach upon the
right to use and enjoyment of . . . claims for mining purposes."75
Thus, under Weiss, the Forest Service may regulate use of
National Forest lands by holders of unpatented mining claims,
like the Shumways,76 but only to the extent that the regula-
tions are "reasonable" and do not impermissibly encroach on
71 16 U.S.C. S 551 (1994).
72 16 U.S.C. S 478.
73 Id.
74 United States v. Weiss, 642 F.2d 296 (9th Cir. 1981).

75 Id. at 299.
76 Like the plaintiffs in Weiss, the Shumways do not claim that the regu-
lations at issue were unreasonable. Therefore we do not consider that issue
in this case.


legitimate uses incident to mining and mill site claims. Con-
gress has refused to repeal the Mining Law of 1872. Adminis-
trative agencies lack authority effectively to repeal the statute
by regulations.

The Forest Service regulations impose numerous require-
ments on anyone running a mining operation in the National
Forests. Mine and mill site operators must give the Forest Ser-
vice "a notice of intent to operate," and based on this notice
"[i]f the District Ranger determines that such operations will
likely cause significant disturbance of surface resources, the
operator shall submit a plan of operations," unless the mine
operation falls within a small group of exceptions. 77 A plan of
operations describes the type of operations proposed and the
manner conducted.78 The plan of operations must be approved
by the District Ranger, who must "analyze the proposal, con-
sidering the economics of the operation along with the other
factors in determining the reasonableness of the requirements
for surface resource protection."79

The Forest Service may also require a mine or mill site
operator to furnish a bond to secure compliance with the plan
of operation's reclamation requirement.80  Because the bond is
linked to the reclamation goals of the plan of operations, the
bond amount may not be set arbitrarily. The regulations spe-
cifically require the Forest Service to consider the costs of
reclamation in setting the bond amount: "In determining the
amount of the bond, consideration will be given to the esti-
mated cost of stabilizing, rehabilitating, and reclaiming the
area of operations."81 Also, the regulations expressly permit
the Forest Service to adjust the bond when the plan of opera-
77 36 C.F.R. S 228.4(a) (1998).
78 See 36 C.F.R. S 228.4 (1998).
79 36 C.F.R. S 228.5(a).
80 See 36 C.F.R. S 228.13.
81 36 C.F.R. S 228.13(b).


tions changes, and requires the Forest Service to reduce the
bond amount as the Forest Service accepts portions of recla-
mation as completed.82

[15] The Forest Service, in 1990, requested that the Shum-
ways submit a new plan of operations since "their operations
had changed substantially," citing additional equipment, pile
of refuse and change in the type of chemicals used. The Forest
Service eventually agreed to approve the plan of operations
that the Shumways submitted in December 1990, but
increased the bond requirement for the Shumways' mill sites
from $5200 to $18,000. But because the Shumways' bond
was by a surety not approved by the Department, no surety
approved by the Department would write the bond, and the
Shumways could not spare $18,000 cash, their plan of opera-
tions was not approved. Nothing else about the plan was dis-
approved except the Shumways' surety on their bond. More
recently the Forest Service estimated that the required bond
would be between $100,000 and $150,000. The Forest Ser-
vice justified this dramatic increase as based on the cost of
clean up, due to the "current conditions" at the mill site--
including the "substantial amount of equipment and other

material, including vehicles, scrap metal, and trash," which
they disputably characterized as "junk."

The Forest Service's Complaint asked the court to evict the
Shumways because they had not filed a plan of operations nor
the required bond. The Shumways argue that the Forest Ser-
vice would not accept their plan until they filed the requested
bond. But the bond amount, argue the Shumways, was imper-
missibly arbitrary.

[16] Based on our review of the evidence before the trial
court, there is an issue of fact as to whether or not the govern-
ment properly increased the bond amount to an arbitrary fig-
ure, and threatened additional arbitrary increases if the
82 See 36 C.F.R. S 228.13(c), (d).


Shumways met the figure. As we discussed above, the Shum-
ways presented evidence contradicting the Forest Service's
assertion that the mill site operations had changed substan-
tially and that their equipment and materials were "junk." If
that is true, the bond amount should not have drastically

[17] The Shumways have also raised a genuine issue of
material fact as to whether remediation would include the cost
of hauling away the equipment and materials on the site. If,
as the Thorne affidavit says, the equipment has a replacement
value of $400,000 then costs of transportation would merely
be a factor affecting the price at which the equipment could
be sold.

[18] Nor does the record provide a basis for evicting the
Shumways. There is uncontradicted evidence that the Shum-
ways own the mill site claims. There is no evidence in
the record before us that (as was the case in Goldfield Deep
Mines83) the Shumways' claim is a sham. Even had there
been, the Shumway and Thorne affidavits would establish a
genuine issue to the contrary. The Forest Service has offered
no explanation for why its disapproval of an operating plan
should result in eviction. The more appropriate remedy, con-
sistent with the mining or mill site claim owner's rights as
well as the Forest Service's would be an injunction, requiring
appropriate measures to protect surface resources or prohibit-
ing mining or milling pending approval of an appropriate plan
or bond. Failure to file an approved operating plan cannot,
ipso facto, cause a forfeiture of the bona fide claim owner's
equitable title and possessory right. The Shumways are not
guests at their mill site, but property owners. Like someone
who proposes to operate a nursing home in an area zoned for

single family residential and light retail, regulations may pro-
83 United States v. Goldfield Deep Mines Co., 644 F.2d 1307 (9th Cir.


hibit their proposed use, but it does not follow that they forfeit
their interests in the real estate.


Genuine issues of fact preclude summary judgment.



WALLACH, District Judge, Concurring separately:

I concur in this opinion. The Forest Service would do well
to remember that miners explored and built much of the west-
ern United States using long-established techniques, some of
which dated from the Middle Ages. Many of those methods
are still perfectly workable. Mining equipment, especially that
used in grading, crushing, and grinding ore may well be old,
battered, and rusty and yet still be entirely serviceable, partic-
ularly for small operators. It is hardly "junk".


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