138 F. Supp. 281 | Ct. Cl. | 1956
Lead Opinion
delivered the opinion of the court: '
The plaintiffs were, at the times herein mentioned, the owners and operators of gold mines. On October 8, 1942, the War Production Board issued Limitation Order L-208 requiring certain so-called non-essential mines to close down and cease all mining operations, or any other operations in and about the mines, except to the minimum amount necessary to maintain the mines safe and accessible. Violations of the order were punishable by fine and imprisonment. By its terms, the order suspended for the life of the order the right of plaintiffs to mine and sell gold.
It is. plaintiffs’ contention that this action by the Government amounted in law to a taking, for a public purpose, of their right to make profitable use of their mining properties for which just compensation is due them under the. Fifth Amendment to the Constitution. In the alternative, the plaintiffs contend that by virtue of the jurisdiction conferred on this court by the special jurisdictional act of July 14, 1952, -66 Stat. 605, they are entitled to recover for the closing of their mines the amount of losses incurred as a result of Order L-208. It is plaintiffs’ position that in the absence of the special jurisdictional act, this court would not have jurisdiction to render a judgment in favor of. a gold mine owner for losses incurred unless they could establish a compensable taking, but that the act conferred on this court jurisdiction to render judgment for such losses where they resulted from the issuance of L-208.
By the time L-208 was issued by the War Production Board, on October 8, 1942, the President had delegated to that Board all allocation, priorities and requisitioning powers granted to him by Congress,
The mining industry, along with other industries, was subject to regulation of its acquisition and use of materials, supplies and equipment needed in the defense effort. A general repair order known as P-22 was issued on September 9, 1941, which authorized a variety of industries, including the mining industry, to use only the lowest preference rating, i. e., A-10, to acquire the materials needed for the repair of their mining property and equipment. On September 17, 1941, Preference Bating Order P-56 granted an A-8 preference rating to so-called recognized mining enterprises to acquire materials needed by them for operating supplies and for the maintenance of the mines’ property and equipment. This order represented the first special treatment accorded to gold mines as distinguished from other types of mines, in that placer gold mines were expressly excluded from any benefits under the order. Lode gold mines were permitted the use of the A-8 rating because it was recognized that denying to them repair and maintenance supplies would cause depreciation of their installed equipment and structures, and because many lode mines produced metals other than gold which were useful to the defense effort.
No agency of the Government was ever granted any real power to control civilian manpower during the war. However, the War Production Board found it necessary to take into consideration manpower problems obviously inherent in the overall problem of increasing the production of vital raw materials and finished products necessary for defense. Shortly after the establishment of WPB’s predecessor agency, the Office of Production Management, an operating division known as the Labor Division was established in OPM to study and keep abreast of the labor requirements for national defense and to advise and collaborate with the other divisions of OPM on all matters affecting labor.
During this same period the gold mines were losing experienced miners by virtue of the same circumstances, except that working conditions in many of the gold mines were good, many of the miners owned their own homes, and gold mining was often a family tradition from which they would not readily depart.
Based on 1940 and 1941 statistics furnished by the Bureau of Mines, the War Department, the War Manpower Commission and the War Production Board’s Labor Division determined that if the gold mines could in some way be closed down, several thousand hardrock miners would immediately become available for work in the nonferrous metal mines, although no one was quite sure how they could be induced to go to work in such mines since no one had authority to require them to do so. A survey by WPB’s Mining Division revealed that the labor figures arrived at by the Labor Division were unduly optimistic and that the probable
Over the vigorous objection of informed persons in and out of the War Production Board, the Board on October 8, 1942, issued L-208 which ordered the complete shutdown within 60 days of all the country’s gold mines which did not produce sufficient strategic metals to warrant their holding serial numbers.
Within a relatively short time it became apparent that the closing of the gold mines was doing little to relieve the shortage of hardrock miners in the strategic metal mines. In fact, the record indicates that no more than 100 gold miners went into other mines and remained there for a year or more. Despite numerous appeals and a desire on the part of WPB officials to modify the order to permit the gold mines to operate at least on a break-even basis, the order was continued in effect and unchanged until the summer of 1945.
The record establishes that no one having anything to do with the issuance of L-208 believed that it was devised or intended to be devised for the purpose of conserving critical materials, equipment or supplies, inasmuch as existing preference orders had solved that problem in connection with the gold mines. Although WPB had full power to requisition any large inventories of supplies, materials, and equipment owned by the gold mines, or to authorize more essential users of such materials to place mandatory orders with the gold mines, no such power was ever exercised. In L-208 WPB did not even attempt to assure that those critical materials, equipment and facilities would be held for possible future requisition or order, but left the owners free to sell them to anyone they pleased, whether the prospective purchaser was engaged in essential defense work or not.
The record establishes that the purpose and intent of WPB in issuing L-208 was to deprive the gold mine owners and operators of the right to use their properties in the only way they could be beneficially used, i. e., to mine and sell gold for a profit, and that this was done in the unfounded hope that the underground workers thus deprived of their employment in the gold mines might seek employment in the nonferrous metal mines. The record fails to establish that
The following contentions were made in the Homestake brief and were adopted in general by all the other plaintiffs. After discussing those contentions and disposing of them, we shall take up separately the applicability of the conclusions reached to each of the plaintiffs.
Plaintiffs contend that L-208, while in form a regulation restricting their acquisition and use of critical materials needed for defense, was in substance a requisition or taking, for the life of the order, of plaintiffs’ right to make profitable use of their gold mining properties for which taking the Government is liable to pay just compensation under the Fifth Amendment to the Constitution. Plaintiffs also contend that if the court should decide that L-208 was actually such a regulation in substance as well as in form, it was arbitrary in that it went far beyond what was required by the exigencies of the war situation existing at the time of its issuance, bore no reasonable relation to its ostensible purpose of conserving critical materials needed in the defense effort, and in fact and law amounted to a taking of valuable property rights of plaintiffs for which just compensation should be paid.
The Government contends that regardless of how much damage plaintiffs may have suffered by virtue of their compliance with the provisions of L-208, the order was a proper exercise of the statutory regulatory powers over critical materials by the War Production Board; that it was issued to prohibit plaintiffs’ use of those materials in a manner detrimental to the public safety in wartime; that the Government made no use of plaintiffs’ property nor did the order represent any positive invasion of any of plaintiffs’ property rights, and that no direct benefits accrued ot the Government from the imposition of the order except the negative benefit arising from the prohibitions placed on plaintiffs’ use of their property. Defendant urges that under these circumstances, plaintiffs’ losses are no more compensable than were the losses suffered by the St. Regis Paper Company from the imposition on it of War Production Board General Preference Order M-251 (St. Regis Paper Co. v. United
Our first problem is to determine the precise nature of the action'taken by the War Production Board in its issuance of L-208, i. e., whether that action amounted to a regulation or a taking of plaintiffs’ property rights. Next it must be determined whether WPB had the power to do what it in fact did, and finally whether the Government is liable for the injuries caused plaintiffs by the exercise of that power, even though the power was exercised arbitrarily.
The property which plaintiffs contend has been taken from them, and which defendant urges was merely limited in its usefulness to plaintiffs as a consequence of a valid regulation of scarce materials, was plaintiffs’ right to make profitable use of their gold mining properties. As pointed out by Mr. Justice Roberts in United States v. General Motors Corporation, 323 U. S. 373, while “property” as that term is used in the Fifth Amendment certainly means the physical thing with respect to which the citizen exercises rights recognized by law, it also means the group of rights inhering in the citizen’s relation to the physical thing, as the rights to exclusively possess, use and dispose of the physical thing. In this sense, the right of a gold mine owner to extract gold from his mine and to sell it for a profit, is a property right protected by the Constitution. Pennsylvania Coal Co. v. Mahon, 260 U. S. 393.
The order was issued on October 8,1942, by the War Production Board which had succeeded to all the powers and functions of the old Office of Production Management and the Supply Priorities and Allocations Board. The preamble to E-208 reads as follows:
The fulfillment of requirements for the defense of the United States has created a shortage in the supply of critical materials for defense, for private account and for export which are used in the maintenance and operation of gold mines; and the following order is deemed necessary and appropriate in the public interest and to promote the national defense.
The statutory authority cited at the conclusion of the order was section 2 (a) of the Act of June 28,1940 (54 Stat. 676), as amended,
* * * Whenever the President is satisfied that the fulfillment of requirements for the defense of the United States will result in a shortage in the supply of any material or of any facilities for defense or for private account or for export, the President may allocate such material or facilities in such manner, upon such conditions and to such extent as he shall deem necessary or appropriate in the public interest and to promote the national defense.
As further authority for its issuance, the order cited Executive Order 9024 (January 16, 1942) abolishing SPAB and establishing the War Production Board, Executive Order 9040 (January 24,1942), abolishing the Office of Production Management and transferring to WPB all of its duties and
Order L-208 provided that for the purposes of the order all gold placer or lode mines located in the United States or its territories or possessions which did not hold serial numbers under Preference Bating Order P-56 were deemed “nonessential mines”.
The preamble to the order, the authority cited at the end thereof, and the prohibition placed upon the acquisition of critical materials, indicate that the order was merely intended to allocate away from the so-called nonessential gold mines materials, equipment and facilities which were in short supply and needed for defense. A study of the balance of the order, particularly in the light of certain facts of record, persuades us that the order was not intended to be an allocation order. Insofar as the order prohibited the acquisition of materials, equipment and facilities, certain existing orders, P-56 and P-100, already prevented the acquisition by the gold mines of any such materials except, in the case of P-100, where gold mines did have the lowest priority rating in existence for repair parts, and that could have been revoked. The record establishes that the gold mines, particularly the Homestake mine, had on hand in October 1942 large amounts of materials, equipment and facilities needed in the mining of gold and that Homestake, and some of the others whose circumstances we shall discuss separately, could have continued operations with such inventories for a considerable period after October 8, 1942. L-208 did not in fact “allocate” any of such materials, equipment or facilities away from the mines but, on the contrary, left the mine owners and operators free to dispose of them in any manner they saw fit, by delivering or selling them to nonessential users or by keeping them in the mines. What the order did do, and do directly, was to prohibit the continued operation of the gold mines¿
The preamble to the St. Regis Order, M-251, was in all material respects identical with the preamble of the gold order, R-208.
Order M-251 provided that in areas declared by WPB’s Director General for Operations to be shortage areas, the Director General could allocate the available supply of pulpwood held or accumulated in that area away from and to specific persons; that he could direct the holders of pulpwood in the area to maintain their accumulations of pulpwood available for disposition by the Director General who might direct the delivery of specific quantities of such accumulated pulpwood to specific persons. The Director General was authorized to direct that no one in the area might acquire, consume, process or deliver any pulpwood of the types defined, and which were held or accumulated in the area, except as the Director General might order. The Director General was also authorized to require the manufacture of particular types of woodpulp or other wood products by manufacturers. On October 23, 1942, this order was applied specifically to the St. Regis Paper Company and that company was forbidden to acquire, consume, process or deliver any
In its suit in this court, the St. Regis Paper Company contended that M-251 amounted to a temporary taking of its paper factory and of its right to do business. Although it was not made an issue in the case, M-251 probably did amount to a taking of plaintiff’s inventory of pulpwood (cf. Edward P. Stahel & Co., Inc., et al. v. United States, 111 C. Cls. 682, cert. den. 836 U. S. 951), but plaintiff did not sue for the taking of its pulpwood, probably because shortly after the order was issued plaintiff received what it considered to be just compensation on the mandatory sales to the Government’s designees pursuant to M-251. The court held that M-251 did not require the closing of plaintiff’s plant nor did it interfere with plaintiff’s use of the plant; that, on the contrary, the order represented a valid exercise of WPB’s admitted power to allocate a scarce material such as pulpwood, and that any injury to plaintiff’s profitable use of its plant, or any loss in value of its plant, were merely consequential and therefore did not amount to a taking and were not compensable. The terms of the order itself certainly bore out the court’s conclusion since the order merely represented an attempt by the Government to secure all the available supply of pulpwood in the area by freezing the supplies on hand with the owners in the area and immediately placing mandatory orders directing delivery to speci-
Like M-251, the gold order prohibited the acquisition, consumption or use of certain personal property used in the mining of gold. L-208 did not, however, require the gold mine owners to hold for the use or disposition of the Government their inventories and supplies of the personal property covered by the order but left the owners free to use that personal property in any way they wished except in the mining of gold. The plaintiffs might have sold their inventories of machinery, supplies and equipment to any user whether or not that user was conducting a business which was essential to the defense effort. The record establishes that the Government did not intend to, nor did it ever, requisition any of this personal property or direct the mine owners to sell it to anyone else. From the language of the order itself and from the circumstances surrounding its promulgation, it is apparent that its only purpose was to depirive the gold mine owners and operators of their right to make use of their mining properties.
Since the subject matter of L-208 was the gold mine owners’ right to make use of their gold mines and was not the materials equipment and facilities they had on hand and in which the Government apparently had little interest, the next question is whether L-208 amounted to a “regulation” of that property right or to a “taking.”
“Kegulation” implies a degree of control according to certain prescribed rules, usually in the form of restrictions imposed on a person’s otherwise free use of the subject matter of the regulation. Where the restrictions imposed are temporary and narrow, and where the persons on whose property the restrictions are imposed are assured an opportunity to receive “reasonable” compensation as determined by an impartial arbiter, the courts have held that enforcement of such regulations has not deprived the owner of the regulated property of due process, nor has it resulted in the “taking” of a property right in the constitutional sense. Typical of this type of regulation are the rent control regulations referred to above, regulations issued under the renegotiation statute (Lichter v. United States, 334 U. S. 742) limiting
The case of Edward P. Stahel & Co., et al. v. United States, referred to earlier herein, has much in common with the issues raised in the instant controversy as well as with those involved in the earlier case of St. Regis Paper Co. v. United States, supra. In the Stahel case, as in the others, plaintiffs alleged that an order of the Office of Production Management (predecessor agency to the War Production Board) though in form a regulation, operated in such a manner as to take valuable property rights of plaintiffs without payment of just compensation. The order in question was General Preference Order M-22 issued on October 16, 1941. M-22 prohibited the owners of raw silk, including the plaintiffs, from selling or delivering their silk to any user but the Government or persons designated by the Government, and further provided that any orders placed with such owners by the Government or its designees had to be accepted and filled. The order did not prohibit the acquisition of raw silk by plaintiffs. Some two months after the issuance of M-22, the Government and its designees began placing mandatory orders with plaintiffs for the silk which was paid for, upon delivery, at the OPA price. Plaintiffs sued for
It seems to us that the restrictions placed by L-208 on the right of gold mine owners to mine and sell gold were neither conditional nor limited and were as complete as were the restrictions placed on plaintiffs’ silk in the 'Stahel case. In neither the Stahel case nor the instant case did the Government, through the orders issued, attempt to vest in itself title to the subject matter of the orders, or to assert any proprietary rights in the subject matter. In both cases the orders merely sought to impose certain negative restrictions on the otherwise free use of their property by the owners. If plaintiffs’ silk was taken by M-22 because that order served to deprive plaintiffs of all beneficial use of their silk, regardless of the fact that physical invasion of the property right was merely threatened in the order and might never have taken place, it would seem to follow that L-208 was equally a taking of the right of the gold miners to make profitable use of their mining properties by mining and selling gold.
To allocate means to distribute or to assign. Allocation is the act of distributing or of putting one thing to another. Insofar as L-208 prohibited the acquisition by gold mine owners of materials, equipment and machinery, the order was allocating the available supply of those items away from the gold mines so that there might be more to distribute or allocate to mining enterprises considered to be more essential to the war effort. Insofar as L-208 prohibited the mine owners from using any of the materials, supplies, equipment, machinery and facilities owned by them and on hand, that prohibition allocated nothing, i. e., it distributed nothing because the order contained nothing which required the gold mine owners to sell those items to the more essential users. Furthermore, because the order merely deprived the owners of the machinery, materials, supplies, etc., on hand, of the use thereof for one single purpose, i. e., for the continued mining of gold and left the owners free to otherwise dispose of those items as they pleased, that prohibition did not amount to a “taking” of the materials, equipment, machinery, etc., owned by the gold mine owners and operators. The fact that occasional voluntary sales of idle gold mining machinery were made to some more essential mines does not give to that part of L-208 prohibiting the owners from using those items to mine gold the character of an allocation order; it merely emphasizes the fact that those items were not “taken.” But the petitioners herein are not suing for the taking of their machinery, facilities and supplies on hand.
We turn next to a consideration of whether L-208 was in fact a limitation order. Limitation orders were used to supplement priority orders which were not always effective to
No critical materials went into the end product of a gold mine, i. e., refined gold. The gold mining industry used critical materials only for the maintenance, repair and operation of the mines. If it had been the sole purpose of WPB to prevent gold mines from acquiring critical materials to a greater extent than they were already prevented by P-56, under which they could acquire nothing because their serial numbers had been revoked, and under P-100 under which they could acquire only limited amounts with their lowest (A-10) priority rating, that part of L-208 which absolutely prevented the acquisition of those materials to operate the mines, effectively did that.
It has been suggested by defendant that a further purpose of a limitation order was to prevent the consumption of critical materials already on hand and owned by a nonessential industry in order to “conserve” such critical materials. The question immediately arises in connection with L-208: In what significant way did L-208 conserve such critical materials, i. e., the equipment and machinery and supplies of the gold mines ? Presumably something is “conserved” for the purpose of putting it to some more important use, otherwise what is the object of “conservation”? A material may be in short supply but if it is not needed by anyone, it seems hardly a proper object of conservation, and if it is kept idle or saved up, it would appear to be merely hoarded rather than conserved. Also, if something is scarce and is urgently needed by others, it cannot be said to be conserved unless the so-called conservation measure makes
L-208 was labeled a “Limitation Order”, and up to a point it followed the pattern of true limitation orders. But a limitation order has a specific purpose: it is issued to conserve critical materials so that those materials may be used by essential war industries. It is not issued to insure that those critical materials will deteriorate through disuse or be preserved for future use by the nonessential owners thereof. L-208 made specific provision for the gold mine operators to preserve their own critical machinery and equipment so that they, i. e., the nonessential owners, would have that equipment and machinery in good condition for use in gold mining when the limitation order was finally lifted.
Paragraph (b) (3) of L-208 provided that no gold mine operator might acquire, consume or use any critical material, facility or equipment except to the minimum amount necessary to maintain the gold mine's buildings, machinery and equipment in repair and its access and development workings safe and accessible. Paragraph (c) of the order authorized the Director General for Operations of WPB to assign such preference ratings as might be required to gold mine operators to enable them to obtain the minimum amount of critical materials necessary to maintain their nonessential mines on the basis set forth in subparagraph (b) (3), i. e., to keep their machinery and equipment in repair, inter alia.
The above makes it quite clear that the “conservation” brought about by L-208 with respect to the mining machinery and equipment owned by the mine operators was not the usual conservation purpose of a limitation order of WPB, i. e., conservation so that the equipment, machinery and materials owned by a manufacturer of nonessential products might be converted to the manufacture of essential end products either by the owner or by some manufacturer of an essential end product. Any actual conservation intended and brought about by that part of L-208 which prohibited
In summary, it appears to us that only to the extent that L-208 prohibited the acquisition of new materials and equipment was that order either a limitation or an allocation order. The balance of the order, having to do with the prohibition of the consumption and use of materials, equipment and machinery owned by the mines and on hand, in the operation of the gold mines, was not intended to and could not, under the very terms of the order itself, accomplish any of the purposes of allocation or limitation orders. Since that prohibition on use of materials and equipment on hand was neither a limitation nor an allocation order, the destruction of the right to mine and sell gold was not consequential to a limitation or allocation order.
L-208 was aimed, in all its provisions, directly at the beneficial use of the mining properties of the gold mine owners, and the only intention reasonably inferrible from the language of the order itself and the circumstances surrounding its issuance was an intent to temporarily deprive them of that property right. By the issuance of Order L-208 the defendant prohibited the carrying on of otherwise lawful mining operations and thereby placed a definite servitude on plaintiffs’ profitable use of their mines which resulted in a temporary taking of that property right. See Peabody v. United States, 231 U. S. 530; Matthews v. United States, 87 C. Cls. 662, 720.
We come next to the question whether the War Production Board had the necessary authority to issue an order which would have the effect of depriving plaintiffs of their right to make profitable use of their mining properties. The Government contends that if, as argued by plaintiffs, WPB acted “arbitrarily” in issuing L-208, it acted without authority and the Government is not liable to pay just compensation for property destroyed by the unauthorized act of its agents.
While it is true, in general, as urged by defendant, that the Government is not liable for damages occasioned by the
If the statute under which the Government agent is acting specifically forbids the particular act complained of, that action is clearly unauthorized and the Government will not be liable for damages resulting from that action. Hooe v. United States,
If an agent of the Government acts without any statutory authority, that action is unauthorized and the Government will not be liable for damages resulting from that action. In such a case the injured person’s remedy would be by injunction against the individual government official acting without authority. Youngstown Sheet & Tube Co. v. Sawyer, 343 U. S. 579. In that case the President issued an order directing the Secretary of Commerce to take and operate most of the Nation’s steel mills. Although there were in existence at that time two statutes authorizing the President to take both personal and real property under certain conditions, the Supreme Court held, and the Government admitted, that those conditions were not met. Furthermore the Court noted that the seizure technique to solve labor disputes in order to prevent work stoppages was not only unauthorized by any congressional enactment but that Congress had refused to adopt that method of settling labor disputes when it was considering amendments to the Taft-Hartley Act in 1947. The Court f urthér held that not only was there no statutory authority for the seizure or taking of the steel mills, but also there was no constitutional authority for such a taking in that the President had no such inherent power. In the instant case Congress had by legislative enactment given the President authority to take for title or
Where the agent’s actions are not prohibited by statute and where they are within the general scope of his authority, although under general law they may be tortious, the modern trend is to hold such actions to be the acts of the sovereign. This subject was discussed at some length in Larson v. Domestic & Foreign Corp., 337 U. S. 682, in which the Court held that the District Court did not have jurisdiction to grant an injunction preventing officials of the War Assets Administration from selling coal to anyone other than the petitioner on the ground that the suit was actually one for specific relief against the Government which had not consented to be so sued. The petition in that case alleged that the War Assets Administration had sold certain surplus coal to the petitioner; that the Administrator for that agency had then refused to deliver the coal to petitioner and had entered into a new contract to sell the coal to others; that the petitioner’s contract with the Government was an immediate contract of sale under which title to the coal had passed to the petitioner; that, accordingly,
There is, therefore, nothing in the law of agency which lends support to the contention that an officer’s tortious action is if so facto beyond his delegated powers. Nor, we think, is there anything in the doctrine of sovereign immunity which requires us to adopt such a view as regards Government agencies.
The Supreme Court concluded that since the Administrator’s tortious actions were taken pursuant to erroneous decisions (of law) which he was authorized to make, he was acting for and as the representative of the Government and not in his individual capacity. The injunction was denied because it would have required specific relief against the Government itself. The Supreme Court suggested that the petitioner’s remedy was in the Court of Claims for damages for breach of contract or for just compensation for the taking of the petitioner’s coal.
Where a Government agent exercises a statutory power in a manner not provided for in the statute, the courts have held
Even where the remedy at law is less clear and adequate, where large public interests are concerned and the issuance of an injunction may seriously embarrass the accomplishment of important governmental ends, a court of equity acts with caution and only upon clear showing that its intervention is necessary in order to prevent an irreparable injury.
Although the Supreme Court did not characterize as “arbitrary” the action of the Government officials in refusing to institute condemnation proceedings as provided for in the Flood Control Act, it would seem that such action was arbitrary in the same manner that a willful breach of a Government contract by a contracting officer is arbitrary. In neither
A regulation may be so arbitrary in its application to the particular subject matter and under the circumstances that it actually results in the regulatory body exercising powers not conferred on it by statute. This was the case in Berwind-White Coal-Mining Co. v. United States, 9 F. 2d 429. Plaintiffs therein were owners of coal mines and private coal cars. They sought to enjoin the enforcement of an order of the Interstate Commerce Commission relating to the distribution among bituminous coal mines of coal cars during times of car shortages. Enforcement of the order would have prevented the plaintiffs from using their private coal cars. The court observed that the rights of private car use and ownership are recognized by Congress, and that Congress had not delegated to the Commission any power over private car owners or over the soft coal industry. The court held that in issuing the order in question the Commission, through what purported to be an exercise of its regulatory power over carriers, actually abolished the use of private coal cars to a substantial extent and thus deprived the private car owners of the full enjoyment of their rights to operate their mines and supply themselves with coal from other mines. The order of the Commission was held to be unjust and unreasonable and to amount to an unlawfully arbitrary exercise of power which had the effect of regulating that which the Commission had no power to regulate.
It would seem to follow from the above, that the “arbitrary” action of a Government official is not necessarily “unauthorized” and “illegal” if the action represents an exercise of powers delegated to the official by the sovereign.
In the instant case the record establishes that as an order allocating critical materials away from a nonessential user, L-208 was arbitrary and unreasonable. The amount of such materials which were thereby prevented from being delivered to the gold mines was not significantly greater than was already prohibited by existing priority orders, and a simple revocation of those orders insofar as they applied to the gold mines, would have cut off all such deliveries. L-208 did not
Defendant also urges that if, as plaintiffs contend, the only purpose of the order was to divert manpower from the gold mines to the nonferrous metal mines, then the action taken by WPB in issuing the order was unauthorized because the War Production Board had no authority to issue orders affecting manpower.
From our study of the statutes, executive orders and regulations relating to WPB, we think that WPB was authorized to take into consideration the manpower implications of any order it might issue. The relationships between manpower and the consumption of scarce materials, and between manpower and increased production of vital end products, are of too obvious significance in the whole war production situation to suppose that they were not the legitimate concern of the War Production Board. The establishment of the Labor Division early in the life of the Office of Production Management and the presence on the War Production Board itself and on the War Manpower Commission of the Director of the Labor Division, are ample evidence of this concern. While Congress never enacted legislation which gave the Government the power to order a civilian worker to leave one job and go to another, or to order an employer to discharge an employee in order that the employee might be hired by someone else, it was no objection to an order of the Government, otherwise valid, that one of the results of its enforcement would be a better utilization of available manpower in the interests of the national defense. That the main objective of the gold limitation order may have been to bring about a shift in the employment of underground gold miners from the gold mines to the nonferrous metal
The only circumstance under which the Government may escape the obligation to pay for property which is destroyed or taken by the authorized action of its agents, is where, in time of war, that property is inherently dangerous, or is being used in such a manner as to clearly endanger the public safety. Hamilton v. Kentucky Distilleries Co., 251 U. S. 146; United States v. Caltex, 344 U. S. 149. Gold mines which did not possess a serial number under WPB Order P-56 because they did not produce significant amounts of critical metals in addition to gold, were determined by WPB to be “nonessential,” but we know of no precedent which would justify our holding that a nonessential industry or business was, ipso facto, one endangering the public safety in time of war. That such an industry could be regulated, and strictly regulated in wartime, is unquestioned, and resulting losses are not compensable if the action taken is truly regulatory in nature. But the power to regulate a nonessential but nondangerous industry in wartime is not the power to destroy, and limitation is not the equivalent of confiscation. Stone v. Farmers’ Loan and Trust Co., 116 U. S. 307, 331. As the Supreme Court said in Pennsylvania Coal Co. v. Mahon, 260 U. S. 393, 415, “The general rule at least is that while property may be regulated to a certain extent, if regulation goes too far it will be recognized as a taking.”
That the taking of the gold mine owners’ right to make use of their mining properties was not in fact necessary to the successful prosecution of the war, and that the officials responsible for the issuance of L-208 either knew or should have known this fact, does not, we think, relieve the Government of its obligation to pay just compensation for the destruction of this right. The statutes and executive orders granting to the Government authority to take property which would aid in the prosecution of the war left to the discretion of those officials to whom the authority was dele
That the Government did not make any physical use of the gold mines does not deprive its action of its character of a taking. The Supreme Court has held that destruction of private property for a public purpose is the equivalent of a taking of private property for a public use. United States v. Welch, 217 U. S. 333; Kimball Laundry Co. v. United States, 338 U. S. 1.
In concluding that L-208 amounted to a temporary taking of plaintiffs’ profitable use of their mining properties for which just compensation should be paid, we have had the following considerations in mind. If L-208 had merely denied plaintiffs the right to acquire any materials, facilities or equipment needed to operate a gold mine and, as a result thereof, plaintiffs had ultimately found it necessary to cease operations because of lack of needed materials, new or repair parts, their losses would have been consequential to the exercise by WPB of its lawful regulatory power of allocation in connection with scarce materials and therefore would not have amounted to a taking. If WPB had had the power to allocate civilian manpower from and to industries, and, as a result of its allocation, plaintiffs’ mines had been forced to close down, there would similarly have been no taking. If L-208 had not only denied the gold mines the right to acquire materials, equipment and facilities but had ordered the mine owners to cease using what they had on hand, to hold them for the possible use of the Government, and not to dispose of them to anyone but the Government or its designees, such an order would have amounted to a taking by the Government of those materials, facilities and equipment, whether the Gov-
L-208 did not do any of the above things except to deny the gold mine owners and operators the right to acquire additional materials, facilities and equipment. However, the loss of plaintiffs’ right to make profitable use of their mining properties was not, in many cases, the result of that denial. The record establishes that a number of the plaintiffs herein could have operated for a time at least with what they had on hand and without acquiring any additional materials, facilities and equipment which were under Government restriction. How long they could have operated is of importance on the question of damages rather than of liability. But L-208 did not stop with a mere denial of the right to acquire materials, equipment and facilities. The real substance and intent of the order was embodied in the prohibition directed at the continued operation of the gold mines. The so-called limitation on the gold mine owners’ use of the equipment and supplies and facilities which they owned was not intended to make those items available to the Government or to the war effort but was expressly included in the order to insure that they would not be used in the mining of gold, and was part and parcel of the express order to cease doing business.
We conclude that L-208 by prohibiting the carrying on of otherwise lawful mining operations placed a servitude on plaintiffs’ profitable or beneficial use of their mines and thus amounted to a temporary taking of that property right in the case of those mine owners and operators who were forced to close their mines by virtue of their compliance with those provisions of L-208 which prohibited them from using their materials, facilities and equipment to mine gold and which ordered them to close down their mines. Such mine owners and operators are entitled to be paid just compensation within the meaning of the Fifth Amendment to the Constitution.-
The Homestake Mining Company is a California corporation. Homestake is and was in 1942 the owner of patented mining claims covering more than 5,000 acres of mining properties containing gold-bearing ores of great value located in the Black Hills area of South Dakota near the city of Lead. For some 65 years prior to October 8, 1942, Homestake had been engaged in the business of mining, processing and selling gold, and in 1942 it was the largest gold producer in the United States.
The mine was located in an isolated area and was therefore required to observe a policy of self sufficiency. From its early days it maintained larger inventories of supplies and equipment than was customary in most mining enterprises. It owned extensive timberlands which provided lumber needed for the mine. It had developed a coal mine, and it produced all of its own electric power. Prior to the issuance of L-208, Homestake had completed two deep mine shafts and had equipped them with modern hoists. It had also erected a new lumber mill. Its steam power plant was relatively new and its ore processing mills were in excellent operating condition.
The mine maintained its own foundry and machine shops to fabricate and repair a variety of mining and processing equipment. Homestake’s inventory of supplies and materials, which it could not make for itself, was sufficient in October 1942, to permit the company to operate its mine during the entire period of the closure. Dynamite, which the company would have had to obtain within a few months, was readily available without restriction.
The working and living conditions at Homestake in 1942 were superior to those of any of the nonferrous metal mines to which the Government hoped to transfer the Homestake miners. Homestake had lost some of its manpower in October 1942, but had it been permitted to continue operations it could have maintained normal production levels by using mining techniques requiring less labor and by increasing its workday from seven to eight hours.
Prior to October 8, 1942, employment at Homestake had not suffered as had employment in the nonferrous mines and, although some employees had left the mines, most of the old employees stayed on. The reasons for the greater stability of employment in this mine, which constituted the largest single source of experienced miners, were probably the good living conditions, the free medical and hospital service, group insurance, pensions, recreational and other facilities provided for Homestake employees by the company. These conditions were unusual in the mining industry and had no counterpart in the nonferrous metal mines.
After the issuance of L-208, Homestake was permitted to hoist and process ore already broken until the latter part of May 1943. After June 1, 1943, the mine was closed for all except maintenance purposes until July 1, 1945, when the mine was reopened.
Without acquiring new machinery, parts, supplies or other materials, and with a greatly reduced labor force, Homestake
Although Homestake had a large inventory of supplies and materials, and large amounts of machinery and equipment in good condition, neither WPB nor any other Government agency sought to requisition, purchase or compel the transfer thereof to the Government or to a war industry.
The properties of Homestake were useful for no other purpose than the production of gold and were adaptable to no other use than the conduct of a gold mining business. The closing of the mine had far-reaching and drastic repercussions in the city of Lead and in the surrounding communities. The population of Lead declined sharply. More than 750 homes and apartments were left vacant and 36 business establishments which had served the communities were closed. About ten percent of the State’s annual revenue derived from Homestake was lost to the State.
We conclude that L-208 amounted to a temporary taking of the profitable use of the Homestake mining properties for which Homestake is entitled to be paid just compensation within the meaning of the Fifth Amendment to the Constitution. The case will be remanded to a commissioner of the court for trial on the question of damages,
Idaho Maryland Mines Corporation
Idaho Maryland Mines Corporation, a Nevada Corporation, owned in fee certain gold mining properties known as the Idaho Maryland Mines, consisting of approximately 8,000 acres of gold-bearing lands situated in the Grass Valley Mining District in the County of Nevada, State of California, together with all the necessary mining plant and equipment located on those lands.
On October 8,1942, Idaho Maryland had extensive equipment and facilities for the operation of its mining enterprise, including machine shops, electric shops, welding shops, blacksmith shop, carpenter shop, cyanidation plant and smelting plant, a sawmill and other mills, all the usual automotive and other equipment. It also had on hand a large inventory of supplies and materials necessary for operating the mine, including pipe and rail, steel, drill steel, tires,
Prior to the issuance of L-208, the mine had lost considerable manpower. Its payroll was reduced from 800 employees to 212 employees
With a greatly reduced labor force and without acquiring any critical material, supplies, equipment or facilities subject to Government control, Idaho Maryland could have operated its mining properties on a profitable basis during the entire period of L-208.
The properties of Idaho Maryland were useful for no other purpose than the production of gold. Its various machine shops were not capable of being utilized in the mass production of any item.
The closing of the mine caused considerable community dislocation and individual hardship in Grass Valley, California, which was wholly dependent upon the operation of the gold mine for its continued prosperity. Since 1848, the principal occupation of the'inhabitants of the communities of Grass Valley and Nevada City had been gold mining.
On May 3,1944, Idaho Maryland was permitted by WPB to resume operations on a limited basis to be carried out with a force not to exceed 200 men who were required to be over 40 years of age and not employed by other industries. Production was limited to 7,800 tons of ore per month, but because of the length of time it took to prepare for production and to open up the necessary ground workings after extensive damage caused by the shutdown, Idaho Maryland was not able to produce 7,800 tons a month in 1944. Per
The closing of Idaho Maryland was brought about by reason of compliance with the provisions of L-208 which ordered that the mine be closed and that the owners not use materials, supplies, machinery and facilities on hand to operate the mine. We conclude that L-208 amounted to a temporary taking of the profitable use of the Idaho Maryland mining properties for which Idaho Maryland is entitled to be paid just compensation within the meaning of the Fifth Amendment to the Constitution. The case will be remanded to a commissioner of the court for trial on the question of damages.
Central Eureka Mining Company
Central Eureka Mining Company, a California corpora^ tion, owned approximately 641 acres of gold-bearing land located at Sutter Creek, Amador County, California. On October 8,1942, the mine had been producing, gold for about 80 years. It then employed 117 men of whom 78 were classified as underground workers. The average age of these employees was 41.74 years. Most of them were married and had children and a number owned their own homes in the vicinity of the mine. Following the closing of the mine, the company was permitted to retain 42 men for maintenance purposes.
Central Eureka’s equipment included machine shops, electrical shops, blacksmith shop, carpenter shop, an assay office, a complete mill from primary crush to cyanidation, and its own source of timber. It had all the automotive and other necessary equipment required to carry on its mining operations and the servicing of the underground workings. On October 8, 1942, the company was operating profitably and could have continued to so operate throughout the entire period of the L-208 closure without acquiring any critical materials, machinery or equipment and with a reduced force of labor. The properties of the company were useful for no' other purpose than the production of gold, and were adaptable to no other use than the conduct of a gold mining business.
The closing of Central Eureka mine was brought about by compliance with the provisions of L-208 which ordered the mine to close and to cease using its materials, supplies, machinery and equipment to operate the mine. We conclude that L-208 amounted to a temporary taking of the profitable use of the mining properties of Central Eureka for which Central Eureka is entitled to be paid just compensation within the meaning of the Fifth Amendment to the Constitution. The case will be remanded to a commissioner of the court for trial on the question of damages.
Oro Fino Consolidated Mines, Ino.
On October 8,1942, certain gold mining properties located in Ophir Mining District, Placer County, California, were operated by J. C. KempvanEe under lease, dated September 5, 1935, from Hazel P. Gridley. Subsequent to receipt of L-208 from WPB, the lessee was permitted by WPB to continue the removal and milling of broken ore until January 15, 1943. Thereafter, operations at the mine were discontinued and the mine closed down.
As of October 8, 1942, there were approximately 11 employees in the mine as contrasted with about 40 in normal times. The mine was equipped with the necessary machinery and equipment on October 8, 1942, but how long the mine could have continued in operation without acquiring additional materials, supplies or equipment, is not established by the record. The mine could be used for no other purpose than the production of gold, and its closing in early 1943 was due to compliance with those provisions in L-208 which ordered the mine to be closed and prohibited the operator from using materials, equipment and facilities on hand to operate the mine.
The assignment, dated February 2, 1950, states that the lessee, KempvanEe
“does hereby sell, assign, transfer and grant unto Oro Fino Consolidated Mines, Inc., a corporation, all right, title and interest in and to that certain mining agreement and the real property therein described and all rights arising by virtue of said agreement, dated September 5,1935, by and between Hazel P. Geidley, a widow, designated as lessor and J. C. KempvanEe, designated as lessee, * *
At the time of the alleged taking, KempvanEe was the owner of the lease covering the mining properties and the damage, if any, was to KempvanEe. It appears that in 1948 the financial backer of KempvanEe died and he turned for financial assistance to another individual who suggested that the mining operation be incorporated. As a result, the plaintiff corporation was organized on January 4, 1950, and on February 2, 1950, KempvanEe assigned his rights in the lease to the corporation.
We think it immaterial whether or not the somewhat ambiguous assignment conveyed to plaintiff the original lessee’s right to receive just compensation or not since, if it did, the anti-assignment statute, 31 U. S. C. 203, bars plaintiff’s recovery. United States v. Shannon, 342 U. S. 288; Potts v. United States, 130 C. Cls. 88. In the Shannon case, the Shannons had purchased from the Boshamers a tract of land part of which had previously been leased by the Boshamers to the United States. Buildings on the land had been damaged by soldiers of the United States, and the contract of sale to the Shannons provided that the sellers, the Boshamers, released to the purchasers any claim, reparation, or other icause ‘of action against the United States Government for ainyi damage caused the property. The Boshamers were
If the assignment in evidence in this case did not convey to this plaintiff the claim of KempvanEe against the United States, plaintiff is obviously not the real party in interest. If the assignment did convey the claim, recovery is barred by the anti-assignment statute. Accordingly, the petition of Oro Fino Consolidated Mines, Inc., is dismissed.
Alasha-Paoific Consolidated Mining Company
Alaska-Pacific Consolidated Mining Company is a State of Washington corporation owning and operating mining properties located in the Willow Creek (Wasilla) Mining District in the Territory of Alaska. The properties consisted of an underground or lode mine with about 5 miles of underground workings and with two entries. The mine is in an isolated area and except for timber, all supplies, including foodstuffs, were imported from the States by ship, rail and truck. Because of its isolation, the mine customarily carried a substantial inventory of parts, equipment and supplies and at the time the mine was closed by virtue of L-208, Alaska-Pacific had an inventory of parts, equipment and supplies sufficient to permit continued operations for at least one and one-half years. A company village was maintained at the mine, consisting of the mine and mill buildings, various warehouses, shops, dormitories, a school and an office building, a store, messhall and various recreational facilities.
The normal crew at the mine was about 125 men. On October 8,1942, the mine had a crew of 101 men. The only other
Alaska-Pacific was able to produce a small amount of concentrate essential to the smelting of copper and a certain amount of tungsten. WPB was inclined to permit the mine to continue operating for the production of tungsten and, in response to a series of appeals, the mine was permitted to continue operations until August 8,1943, on which date WPB required the mine to close down. Subsequent to the closure of the mine, Alaska-Pacific sold most of the perishable items in its inventory to such agencies as the Alaska Road Commission and the Alaska Railroad, and stored at the mine the other items.
The closing of the Alaska-Pacific mine was brought about by reason of compliance with the provisions of L-208 which ordered that the mine be closed and that the owners not use the materials, supplies, equipment and facilities on hand to operate the mine. We conclude that L-208 amounted to a temporary taking of the right of Alaska-Pacific to make profitable use of its mining properties, for which it is entitled to be paid just compensation within the meaning of the Fifth Amendment to the Constitution. The case will be remanded to a commissioner of the court for trial on the question of damages.
Bald Mountain Mining Company
Bald Mountain Mining Company is a South Dakota corporation owning certain gold-bearing lands in Lawrence County, South Dakota. On October 8,1942, Bald Mountain was engaged in mining gold on those properties. Pursuant to appeals to WPB, Bald Mountain was permitted to continue gold mining operations until August 8, 1943.
It appears that the mine closed in August 1943, because of L-208. The mine was reopened shortly after revocation of L-208 in the summer of 1945. The record does not disclose the nature or size of the mine’s inventory of mining equipment, materials and supplies on hand when the mine finally closed, or how long the mine could have continued to operate without acquiring new materials, etc.
We conclude that L-208 amounted to a temporary taking of the right of Bald Mountain to make profitable use of its mining properties for which it is entitled to be paid just compensation within the meaning of the Fifth Amendment to the Constitution. The case will be remanded to a commissioner of the court for trial on the question of damages. In that connection, however, consideration should be given to the probable length of time Bald Mountain could have operated its mine without acquiring additional materials, facilities or equipment for which priorities were required during the period L-208 was in effect and while the mine was closed.
Alabama-0 alifornia Gold Mimes Company
Alabama-California Gold Mines Company, a State of Washington corporation, owned certain gold-bearing lands located in the State of California. On August 8, 1942, Alabama-California closed its gold mine and ceased all operations because of its inability to secure sufficient manpower or materials. Inasmuch as the mine of Alabama-California was not closed by virtue of compliance with the provisions of L-208, there has been no taking of its right to make profitable use of its mining properties and the petition will therefore be dismissed.
Consolidated Chollar Gould dé Savage Mining Company
Consolidated Chollar Gould & Savage Mining Company, a California corporation, owned certain gold-bearing lands
The above-described rehandling operations proved to be financially impractical and on April 28, 1943, Consolidated Chollar requested permission of WPB to resume its normal open-pit operations. It stated that it expected equipment to be available as a result of the completion of defense projects in the area, and that it would require no more than 20 men from the locality whose average age was over 50 years. Consolidated stated that steel consumption would be low and that it had the necessary steel on hand to operate for at least six months. Consolidated had been granted a serial number for use in its permitted rehandling operations, but on June 19, 1943, WPB refused to transfer the application of that number to the resumption of open-pit operations. Consoli
On August 28,1943, WPB issued Serial No. 36-26-T under Preference Bating Order P-56 which had the result of removing this plaintiff from the restrictions of E-208, and permitted the mine to conduct open-pit operations. It was also authorized by the serial number to the use of a priority rating for obtaining maintenance, repair and operating supplies. The rating was extended through the first and second quarters of 1944.
In December 1943, Consolidated Chollar advised WPB that during the previous ninety days’ operations under its serial number it had been unable to bring its operations up to capacity because of the inefficiency of available labor and the lack of adequate equipment in the form of power shovels and trucks but that it hoped this condition would improve in time. It stated that with 23 men it had been producing an average of 320 tons per day, compared with 400 tons per day in 1942, with approximately the same number of men.
The record does not disclose how long Consolidated Chollar continued open-pit operations under its serial number or its reasons for discontinuing its operations if, in fact, it did discontinue them.
The record discloses that after the war Consolidated found it necessary to first remove overburden from above the ore vein because no ore was clear for breaking. The reason for this was that during the effective period of L-208, Consolidated Chollar had been able to process all the ore which it had stripped of overburden prior to the close of 1942.
Prom the above, it appears that open-pit mining operations of Consolidated, in which it was engaged in October 1942, were not discontinued as a result of the issuance of L-208 except for the period from sometime in November 1942 to
Ermont Mines, Inc.
Ermont Mines, Inc., an Oregon corporation, owned a compact block and contiguous quartz lode mining claim, designated by numbers 1 through 34 inclusive, and located in the County of Beaverhead, State of Montana.
At the time of the issuance of L-208 in October 1942, Ermont was working claims numbered 1 (with drifts on claims numbered 2, 3 and 4), 2 (working over into claim number 6), 7, 9, 19, 20, 23, 24, 28 and 32. After receiving the WPB order to close down pursuant to L-208, Ermont continued taking out ore already mined, ran it through the mill and refinery, and shipped it to the mint. Sometime in November, the mine and buildings were closed and a watchman was employed to look after the property.
On October 8, 1942, Ermont employed a crew of men adequate to work the above claims. The men had homes in the vicinity of the mine. The mine had sufficient supplies, machinery and equipment in good working order which would have enabled the mine to continue operations for at least a year from October 8, 1942, if the mine had not been closed down pursuant to L-208. Mining operations were resumed at Ermont at some time subsequent to the revocation of L-208.
In summary, the following plaintiffs have established their right to recover just compensation for a temporary taking of their right to make profitable Use of their gold mining properties and their cases will be remanded to a commissioner of the court for trial on the question of damages: Homestake Mining Company; Idaho Maryland Mines Corporation; Central Eureka Mining Company; Alaska-Pacific Consolidated Mining Company; Bald Mountain Mining Company, and Ermont Mines, Inc. In view of our decision in these cases it is unnecessary to discuss the various contentions relative to the special jurisdictional act of July 14, 1952, 66 Stat. 605.
The petitions of Alabama-California Gold Mines Co., and Consolidated Chollar Gould & Savage Mining Company will be dismissed, inasmuch as it does not appear that they were closed down as a result of compliance with the provisions of L-208, which circumstance also removes them from any possible coverage by the special jurisdictional act.
The petition of Oro Fino Consolidated Mines, Inc., will be dismissed for the reasons set forth hereinbefore. It is so ordered.
The Act of June 28, 1940, 54 Stat. 676, as amended by the Act of May 31, 1941, 55 Stat. 236, as further amended by Title III of the Second War Powers Act of March 27, 1942, 56 Stat. 177, gave to the President priorities and allocation powers and the authority to delegate such powers. Section 9 of the Selective Training and Service Act of September 16, 1940, 54 Stat. 885, 892, gave the President the power to place mandatory orders for products or materials required for the national defense, and provided for the payment of just compensation for such products, or as rental for any facilities or plants used by the United States. The Act of October 10, 1940, 54 Stat. 1090 authorized the President to take over for use or operation any military or naval equipment, etc., held for export purposes but whose exportation had been denied by law, and provided for payment of just compensation. The Act of October 16, 1941, 55 Stat. 742, authorized the President to requisition all other military or naval equipment not held for export. This act was amended in Title VI of the Act of March 27, 1942, supra, to eliminate the requirement that only equipment and machinery not in actual use by the owner could be requisitioned. Section 120 of the National Defense Act of 1916, 39 Stat. 213, authorized the President to place mandatory orders for the production of materials required for defense and for the seizure of plants refusing to cooperate. All of these acts provided for the payment of just compensation for any interest taken. The President delegated all the above authorities to the War Production Board or its predecessors in a series of Executive Orders as follows: Executive Order 8572, October 21, 1940, as amended by Executive Order 8612, December 15, 1940 (the Priorities Board) ; Executive Order 8629, January 7, 1941 (Office of Production Management) ; Executive Order 8875, August 28, 1941 (OPM and SPAB) ; Executive Order 8891, September 4, 1941; Executive Order 8942, November 19, 1941; Executive Order 9024, January 16, 1942 (WPB) ; Executive Order 9040, January 24, 1942; Executive Order 9125, April 7, 1942; Executive Order 9138, April 17, 1942; by Executive Order 9139, April 18, 1942, the President established the War Manpower Commission and transferred to it the labor supply functions of WPB’s Labor Division.
At this time the Office of Production Management was still in existence. It was not succeeded by WPB until January 1942.
OPM Regulation 5, March 18, 1941, 6 P. R. 1598, 32 CFR 2875 — 1941 Supp.
Act of May 31, 1941 (Pub. Law 89), 55 Stat. 236; Act of March 27, 1942 (Pub. Law 507), 56 Stat. 177.
This provision had the effect of Including In the operation of the order all mines whose gold production In dollar value exceeded 30 percent of its total production.
General Preference Order M-251 contained the following preamble :
“The fulfillment of requirements for the defense of the united States has created In certain areas and is expected to create in other areas a shortage in the supply for defense, for export and for private account, of wood for pulp and lumber, and has created a shortage in the supply for defense, for export and for private account of various materials and facilities required for the production of pulpwood; and the following order is deemed necessary ,and appropriate in the public interest and to promote the national defense."
The Some Building á Loan Association, case, supra, involved the constitutionality of a Minnesota statute which, in time of economic depression sought to relieve the plight of needy mortgagors by providing for a possible extension of the redemption period of their mortgaged property. Citing the many safeguards contained in the statute to protect the rights of the mortgagee and the fact that the mortgagee would ultimately receive all that he was entitled to under the mortgage, the Court upheld the statute as a limited and temporary restriction on the mortgagee’s right to enforce his contract, such restriction being justified by the great public calamity, i. e., the depression. This case was relied on by the mortgagor, Radford, in Louisville Bank v. Radford, supra, to uphold the constitutionality of the Frazier-Lemke Act of 1934, which also sought to relieve the plight of needy mortgagors during the depression. The Supreme Court held that the restrictions imposed by the federal act were neither limited nor temporary and that they amounted to a talcing of valuable property rights of the mortgagees without any compensation whatsoever.
In the Omnia case the Government had requisitioned the entire output of steel by the Allegheny Steel Company and had directed the company not to comply in that year with any contract calling for steel. The Omnia Commercial Company had a contract with the Allegheny company entitling Omnia to Allegheny’s steel at a price well under the market. Omnia sued the united States alleging that the Government had “taken” its right to have its contract with Allegheny performed. The court held that the contract had not been taken but only its performance frustrated and that Omnia’s loss of the expected profit was a consequential loss resulting from lawful governmental action of requisitioning Allegheny’s steel. In the Bowles v. ’Willingham case the Supreme Court held that rent control imposed only temporary and narrow restrictions on an owner’s use of his property.
In its motion for a new trial which was denied, the Government pointed out that under the court’s decision a holder of silk on October 16, 1941, who had never received a mandatory order for any of its silk, would still be entitled to the same compensation as the holder who sold all of his silk on mandatory orders.
it is not contended that their right to mine and sell gold was acquired by defendant in the sense that the Government actually took possession of the mines and carried on the business for its own benefit. It is contended, however, that the Government deprived plaintiffs of their right to make profitable use of their mining properties for the period during which the order was in effect and that this deprivation amounted to a taking. That Government action short of acquisition of title or short of physical occupancy may constitute a “taking” in the constitutional sense has been upheld by the Supreme Court. United States v. General Motors, supra; United States v. Welch, 217 U. S. 333; Richards v. Washington Terminal Co., 233 U. S. 546. As Justice Roberts pointed out in the General Motors decision, it is the “deprivation of
in the Hooe case a federal statute provided that In renting space for Government use, Government officials might not obligate the Government for the future payment of money in an amount in excess of the appropriation. A Government official rented from plaintiff a part of his building at a rental in the full statutory amount, but occupied additional space in the building for which plaintiff was not paid. Plaintiff sued for the additional rent either on the ground of an implied contract or as just compensation for private property taken for public use. It was held that the Government was not liable on either theory since the officer acted without lawful authority when he did anything which tended to commit the Government to pay more rent than the statutory maximum and that in so doing he was not representing the united States.
Hamilton v. Kentucky Distilleries Co., 251 U. S. 146.
The average age of the 212 employees was 47.7 years. Forty-three of the underground workers were 50 years of age or over.
Dissenting Opinion
dissenting:
I concede that that part of order L-208 which directed certain mines to be closed down was invalid. The statute did not authorize such action. Paragraph (b) (1) of that order undertook to do that and was therefore issued without authority. However, paragraphs (b) (2) and (3) of the same order, which forbade the use of critical materials in nonessential industry, were valid exercises of the President’s power under the allocation statute and they would
During the war limitation orders were issued to curtail or prohibit the use of critical materials in the manufacture of nonessential products. L-208 (b) in its second and third paragraphs did just that. The majority concedes that such mines as did not have critical materials on hand are not entitled to recover for the reason that the gold mining process did consume critical materials and that regulations (other than L-208) depriving the operators of the effective right to acquire such materials were valid under the statute.
It follows that L-208, insofar as it prohibited the acquisition of critical materials, was valid. Insofar as this order or other priority or allocation orders, either working together or separately, forbade the use of critical materials on hand for nonessential purposes, they were also valid wartime regulations. St. Regis Paper Co. v. United States, 110 C. Cls. 271; cert. den., 335 U. S. 815. I do not think it matters whether the acquisition or use of critical materials was prohibited by L-208 or by it in conjunction with other priority or allocation orders.
The majority concludes that those operators who had critical materials on hand are entitled to recover for the time that these materials would have allowed them to continue operation. In this respect the court seems to rely mostly on its conclusion that insofar as L-208 prohibited the use of critical materials on hand, it was arbitrary. The court bases this conclusion in turn primarily on the fact that the Government took no affirmative steps to allocate the materials “away from” the gold mine operators into more essential uses.
We do not think this was necessary under the circumstances. If indeed these materials were critical, then it is natural to expect that, under the operation of supply and
It was reasonable to suppose that the gold mine operators would attempt to reduce their capital investment in materials which they had no authority to use. This did in fact happen in the case of the Central Eureka Mining Company which leased some of its equipment to persons engaged in tungsten mining. Thus, while it may be true that there were other motives and purposes in issuing L-208 than the allocation of critical materials, I do not think that in so far as L-208 was intended to allocate critical materials it was arbitrary. There can be no question that some strategic materials could be expected to be saved by the dual prohibition of forbidding the gold mines to acquire new strategic materials and preventing the use of the materials and equipment they had on hand.
It cannot be said that L-208 and concurrent orders in their prohibition of the use of strategic materials on hand had no reasonable relation to the execution of the lawful purpose of allocating strategic materials. Jones v. City of Portland, 245 U. S. 217, 224. That this may have been done more effectively by other means does not matter.
The President had neither the constitutional power nor the statutory authority to close the mines directly. It is probable that as a legal matter the enforcement of that part of the order which directed the closing of the mines could have been enjoined. However, in wartime that is not a very practical remedy because it puts any individual or company in the position of hindering the war effort. In any event the Supreme Court has ruled that the defendant cannot be held for damages flowing from an unauthorized act of its
There is no doubt that plaintiffs were damaged by the necessity of closing the mines. War produces many hardships. It entails many sacrifices. When ceilings are placed on the prices of the products of farm and factory, when wages are frozen and when young men are taken and sent to face hardships and even death on distant battlefields at a small rate of pay in the fixing of which they have had no part, when prices generally are fixed, when all the interests of the nation are fused in the common purpose — losses are inevitable. No nation could justify such action in normal times. It would be next to impossible to measure and pay all the losses involved in an all-out war.
If the Congress should see fit to acknowledge liability to these owners on the ground that their .losses were unusual, the court should willingly undertake to determine the amount, but unless this is done I do not think the court should select these losses to be compensated.
dissenting:
The majority opinion points out that L-208 was not an allocation order, as it purported to be, but rather was clearly an order closing gold mines deemed nonessential to the war effort; i. e., those mines whose gold production in dollar value exceeded 30 percent of their total production.
There was no authority vested in the President to directly close a business. The President could regulate the gold mines, allocate materials away from them, or requisition their materials, or even the business itself, if he determined their need essential for defense, and that such need was immediate and would not admit delay or resort to any other source of supply, and all other means of obtaining the use of such property for defense had been exhausted. See Act of October 16, 1941, 55 Stat. 742. Instead of determining
The majority considers the closing under such circumstances to be a taking of plaintiffs’ right to do business and compensable under the Fifth Amendment. I believe that the President lacked the constitutional power and statutory authority to close these mines and, therefore, the unauthorized closing could and should have been enjoined. Youngstown Sheet & Tube Co. v. Sawyer, 343 U. S. 579.
Inasmuch as the President lacked authority to close these mines, and such closing has not been ratified by Congress, the unauthorized closing is not compensable under the Fifth Amendment. Hooe v. United States, 218 U. S. 322; United States v. North American Transportation & Trading Company, 253 U. S. 330; United States v. Goltra, 312 U. S. 203.
FINDINGS OF FACT
The court, having considered the evidence, the briefs and argument of counsel, and the report of Commissioner William E. Day, makes the following findings of fact:
1. On January 7, 1941, the President of the United States established the Office of Production Management, hereinafter referred to as OPM, and delegated to it the powers and duties described in Executive Order 8629 (6 Fed. Keg. 191) and Executive Order 8942.
2. By Executive Orders issued January 16 and January 24, 1942,
3. The function of WPB and its predecessor agencies was to exercise general direction over the war procurement and production program, to regulate the production and supply of materials and equipment necessary for the national defense, and after the declaration of war for the prosecution thereof, and to determine when and in what manner priorities should be accorded to deliveries of such material and equipment. These agencies fulfilled this function by the issuance of various orders, the most common of which were designated as “P” orders (priorities), “M” orders (materials), and “L” orders (limitation).
The “P” orders were generally addressed to buyers of materials and authorized them to attach to their purchase orders a letter or symbol entitling them to preference in delivery. Once having been granted, this preference could usually be applied on a repetitive basis.
The “M” orders were usually directed to the manufacturers or distributors of materials and were aimed at controlling either the use or the distribution of particular materials. These orders frequently prohibited producers from selling to any buyer unless the buyer had some preference rating.
The “L” orders were usually issued to prohibit or curtail the manufacture of end products containing critical materials, continued production of which would have necessarily consumed such critical materials. Sometimes an additional purpose of such “L” orders was to accomplish the conversion of scarce manufacturing facilities to war production.
“L” orders were issued prohibiting or limiting the production of end products such as office machinery, furniture, bicycles, stoves, refrigerators, laundry equipment, automobiles, and other products. In most instances a prohibition
Issuances of “L” orders sometimes released manpower employed in the production of the prohibited end products. Working with the particular industry branch involved in the “L” order, the Labor Production Branch
Where an area was threatened with serious economic dislocation by reason of the threatened closing down of a primary industry resulting from an “L” order because substitute materials were not available to produce that industry’s product, either the area or the industry could be certified as “distressed” by WPB. Such a certification entitled the firms in the area to special treatment in the awarding of war orders, i. e., the orders did not have to go to the lowest bidders, and financial assistance could be given to enable the plants to convert. The entire washing machine industry was so certified.
The preference ratings assigned under the “P” orders originally ranged from A-l to A-10, with the highest rating, A-l, being further subdivided. There was no control over the number of buyers who might be given a particular rating, and a buyer having one of the lower preference ratings might and often did find it impossible to purchase any material because the holders of the higher ratings had exhausted the available supply.
4. In the decisions by OPM and WPB to issue a “P”, “M”, or “L” order, a number of considerations might be involved
5. On July 29,1941, OPM issued Preference Eating Order P-28 in order to facilitate the acquisition of materials by producers of machinery and equipment used in the mining, beneficiation and preparation of coal and metallic ores. Said order authorized such producers to use a preference rating of A-3 for the acquisition of such materials.
6. On September 9, 1941, OPM issued Preference Eating Order P-22, known as the General Eepair Order. It authorized a broad variety of industries, including mines and quarries generally, to use an A-10 rating for the acquisition of material needed for the repair of their property or equipment.
7. On September 17,1941, OPM issued Preference Eating Order P-56 and amended it on September 22, 1941. Said order, as amended, authorized recognized mining enterprises to use a preference rating of A-8 for the acquisition of materials needed for operating supplies and for the maintenance of the property and equipment of such mines. Under the terms of said order OPM was to issue so-called mine serial numbers to all mines certified by an appropriate agency of a State, Territory or possession as constituting a recognized mining enterprise.
Placer gold mines but not lode gold mines were expressly excluded from the benefits of Order P-56. Placer mining is the derivation of gold from streamborne materials in contrast with lode mining which is the underground working of auriferous quartz veins in hard rock.
The reason for the distinction between lode and placer mines in the assignment of preference ratings under Order P-56 was set forth in a report entitled “Status of Gold Mining” submitted to SPAB on November 18, 1941, by its Executive Director, Donald Nelson. The report read in part as follows:
*61 * * * Most lode mines are underground, and consequently subject to tlie hazards of rapid depreciation if they are shut down. Flooding by water is the chief hazard. Though not all lode-mining is deep enough to suffer seriously if a shutdown occurs, continuity of operation is clearly desirable to prevent depreciation of installed equipment and structures. On the other hand, placer operations can be discontinued (and often are, seasonally) without injury to equipment. * * *
Another reason for this distinction was stated in November 1941 by Dr. Wilbur Nelson, who was then Priorities Specialist and Administrator of Order P-56 and who later became the Chief of the Mining Branch of WPB, to be “that we felt that we must start restricting mining activities where they were not essential to the production of materials needed in a defense effort.” This referred to the fact that placer mines produced only gold, while many lode mines produced other metals.
8. In the memorandum submitted to SPAB on November 18, 1941, Mr. Donald Nelson had reviewed the problems relating to furnishing materials both to gold mines in the United States and to gold mines in foreign countries, and had said, in part:
1. A general announcement of policy toward gold-mining is needed. Otherwise, specific administrative actions will be questioned by the mines as unfairly discriminatory. This is particularly necessary if the purchase of new machinery for gold production is to be virtually prohibited after November 30. A necessary preliminary to such a declaration would be a request to the Treasury for an immediate formal opinion on the significance of new gold production to monetary policy. It is to be emphasized that from a consumption of scarce materials standpoint, this whole issue is a minor one. Only about $7,000,000 of equipment, not including a lesser amount for repairs and maintenance, is involved annually at a maximum. Such importance as the issue possesses is largely political. It is political from two opposing standpoints — that of popular reaction to the continuation of an industry widely regarded as unnecessary (to the point of jocularity), and contrariwise, that of the regional interests delineated in the report.
2. The continuation of the right of lode gold mines to use the A-8 rating under Order P-56 could be made entirely discretionary with the Director of Priorities.*62 The guiding principle might be established by SPAB of requiring their purchases to be held to the bare minimum necessary to prevent disastrous shut-downs. SPAB might also wish to establish a separate test of eligibility in terms of the amount of other more useful metals that are produced jointly with gold. For example, if the selling value of the essential metals is 25 percent and that of gold produced 75 percent, the mine might be permitted to buy machinery and supplies on the same basis as other essential metal producers. Or the minimum ratio might be set at 40 percent in the value of other metals, and 60 percent gold. The intent would be to avoid any discouragement to production of the essential metals.
3. An alternative, and more drastic, policy would be to eliminate all domestic gold mines, whether lode or placer, from Order P-56 and also from the general repair Order, P-22. Gold mine operators would thus be forced to buy repairs and supplies without A-ratings, but could apply for special help on Form PD-1. It is quite possible that only very gradual declines in output and employment would result, because of managerial ingenuity. Here again, exceptions could be made for mines producing other metals.
4. In lieu of any blanket privileges to foreign mine operators, all foreign mine needs could be reviewed continuously with the Economic Defense Board, so that considerations of inter-American and British American policy could be consistently applied to decisions authorizing or forbidding shipments of gold-mining machinery and repair parts. No serial numbers authorizing several purchases would be issued, but applications for individual shipments would be entertained. Here again, the specific quantities of burdened material (which are not large) are not the issue, but the political considerations involved and the question of treating nonessential industries consistently are paramount. In the special case of Canada, the Joint Economic Committees could secure all relevant statistical data.
5. Some special basis of treatment might be worked out for Alaska, where gold mining assumes the proportions of a majority industry. To cut off suddenly all shipments of new equipment needed for replacement, and to make it unduly difficult to secure supplies, might have several effects upon employment in Alaska, and upon the revenues of the Territory. The Labor Division might be asked for a formal opinion on the probable impact upon employment in the Territory of*63 the restrictions suggested in this report. The Territorial Government could also be asked for a formal report on the importance of gold mining, with all relevant statistical data.
On November 24,1941, a meeting concerned with priorities and export licenses for gold-mining machinery was called by A. A. Eerie, Jr., Assistant Secretary of State. It was attended by representatives of the Treasury Department, the Federal Reserve Board and OPM, as well as the State Department. The consensus of opinion at such meeting was reported that:
* * * preference ratings for gold mining equipment should be granted only after careful scrutiny with a view to maintaining, at the very most, existing rates of output and to refusing equipment for any expansion of output; subject to exceptions in cases where extraordinary hardship might result — as in the case of isolated communities having no alternative forms of employment — preference ratings for exports of gold mining equipment should be made to depend on a showing that the maintenance of the present level of gold production is necessary (a) to supply dollars for an otherwise deficit dollar position in the balance of payments of the country (or in the case of South Africa, for the dollar position of the sterling area), or (b) for special political reasons; whenever the current gold mining is maintained mainly to prevent a dollar deficit and especially where the labor could be used for more direct contribution to defense production, this Government should endeavor to find other means of meeting this deficit such as lend-lease activities, purchase of gold “in the ground” for postwar delivery, and the like. To give effect to the foregoing conclusions, no general priority ratings for gold mining equipment, including repair and replacement parts, should be granted but individual consideration should be given to each application on its merits unless adequate periodic compliance investigations can be made (particularly in Canada) as is done in the United States.
On December 2,1941, SPAB, having before it the report of the November 24 meeting quoted above, directed Donald Nelson to obtain the official opinions of the State Department, Treasury Department, Federal Reserve Board and the Board of Economic Warfare on “supplying gold mining
9. Donald Nelson complied with the directions of SPAB, and secured the official comments of these departments and agencies. The Secretary of the Treasury stated in part as follows:
* * * Domestic gold production in wartime serves no military purpose, but does consume labor and materials that have usefulness in military production, particularly in the mining of scarce metals. We do not believe, therefore, that domestic gold mines should receive any preference rating for machinery unless the gold is produced with a substantial amount of much needed byproduct metals or ores, or unless it is produced in a mine so peculiarly situated that serious and sustained unemployment of men not eligible for defense jobs would result from its shutdown.
The Secretary of State confined his reply to the subject of supplying gold-mining equipment abroad, and said in part:
It is the Department’s opinion that preference ratings for gold mining equipment should be granted only after careful scrutiny with a view to maintaining, at the very most, existing rates of output, and to refusing equipment for any expansion of output. * * *
The Chairman of the Board of Governors of the Federal Reserve System stated in part that:
. Priority measures tending to reduce new gold production under present circumstances are, in my judgment, highly desirable. The United States stock of gold is already redundant. Its dollar value is more than five times as great as in the 1920’s. From the standpoint of credit control in this country further additions to gold stock, are not only unnecessary; they are harmful. By swelling excess bank reserves, they add to inflationary dangers and make the maintenance of a stable and productive economy more difficult. From the standpoint of .war output of the allied countries, the materials, machinery, and labor devoted to gold production are largely wasted.
*****
Since new gold output is largely unnecessary and diverts materials, machinery, and labor from production of war supplies, I strongly favor curtailing it so far as is practicable through the priorities system. I would*65 suggest that no machinery be allowed to foreign mines for the expansion of gold output; and that machinery and supplies for the maintenance and repair of gold mines should be restricted to the minimum consonant with the principles adopted by the Supply Priorities and Allocation Board for other nondefense industries.
Milo Perkins, Executive Director of the Board of Economic Warfare, after discussing the question of supplying mining equipment to foreign gold mines, proceeded to outline a policy with an ultimate objective of eliminating the domestic gold-mining industry in the postwar era. In this connection he stated:
The system of priorities on gold mining equipment was devised as part of the general effort to economize on scarce facilities and thereby to maximize the joint war effort of the nations fighting for the democratic cause. But in dealing solely with the question of gold mining equipment there is a danger of losing an opportunity both to solve the longer-term aspects of the gold problem and to maximize the joint war effort. Such an opportunity exists now. The United States can and should use the power that it derives from being practically the sole buyer of the yellow metal in order to initiate a program of a gradual reduction in gold production. Such a program would contribute to a maximization of the joint war effort and, at the same time, would facilitate a solution of the postwar gold problem.
* * * # #
It is essential therefore, that a reduction in gold mining should be envisaged for the postwar period. It is, however, obviously impossible to effect a cessation of gold production overnight because of the enormous dislocation it would involve in the national economies of the more important gold producing Countries. The purchase of gold in the ground leaves the problem unsolved, and merely adds to the difficulties of the immediate postwar period. A program of gradual reduction and final cessation of all new gold production spread over a period of fiften to twenty years is the only satisfactory solution to the general gold problem. This is the. moment to institute such a program. Further, the United States possesses the necessary powers to initiate such a program. Being practically the only buyer of the yellow metal, the United States is in a position to demand that its future purchases will be on an increasingly restricted scale. * * *
As directed by the Board at its December 2d meeting I have obtained the official opinions of the State Department, Treasury Department, Federal Reserve Board and Board of Economic Warfare on supplying gold-mining equipment abroad and on other possibilities of providing dollars to offset probable dollar deficit positions.
The following is a summary of these opinions
1. In a war economy labor, materials, and machinery applied to gold production are largely wasted. Moreover, dollars made available through Lend-Lease, R. F. C. and stabilization loans, etc., have made new gold unnecessary as a provider of dollar exchange. Therefore :
(a) Nothing should be allowed for expansion, although minimum amounts for maintenance and repair should to some extent be provided.
(b) Only high-grade ores or those yielding high percentages of other minerals useful in the war effort should be mined.
(c) Labor, materials and machinery should be converted to more vital production except where extreme political or economic hardship would result.
2. In-the-ground purchase of gold is neither necessary nor desirable. It is an experiment which raises serious complications and not only fails to solve the present problem but also presents a new one for the postwar period.
3. Agreements should be entered into with gold producing countries, to the end that they do not divert labor, materials and machinery from more essentia] uses to gold production.
On the same day SPAB adopted the spirit of these recommendations. It stated:
It was the judgment of the Board that in view of the military program only limited priorities and export licenses should be granted to the gold mining industry,
and it was agreed
that in granting priorities and export licenses for gold mining machinery, materials should not be allowed fox expansion of production although minimum amounts for maintenance and repair may be provided.
P-100 represented a continuation of SPAB’s policy of granting some preference rating for maintenance, repair and operating supplies to industries in general without regard to essentiality in the war program, and this policy prevailed throughout the war. This policy was designed to avoid unnecessary dislocations in the civilian economy. The percentages of critical materials such as steel, aluminum and copper used in all industries for maintenance, repair and operating supplies ranged from one-half of one percent to three percent of the total amounts available for the entire economy.
11. On December 31,1941, OPM issued Preference Eating Order P-56-a to supersede P-23, which had expired on that date. Order P-56-a continued to authorize the manufacturers of mining machinery to use a preference rating of A-3 to acquire material entering into the production of machinery and equipment ordinarily used in the mining industry, including the gold-mining industry.
12. By a letter dated February 18, 1942, John P. Gregg, Assistant Chief of the Bureau of Priorities, WPB, proposed to C. H. Matthiessen, Jr., Chief of that Bureau, that gold and silver mines be closed forthwith in order to conserve materials. The letter stated in pertinent part:
.4. The Committee is of the view that the restrictions with respect to materials to be used in the mining of gold and silver are not sufficiently restrictive and that a limitation order should.be drafted forthwith to stop production of gold and silver in the United States, appropriate consideration being given to the continuance*68 of such production in Canada, Mexico, South .Africa, and other areas now permitted to obtain materials, and equipment from this country under Lend-Lease or direct purchase.
13. Said proposal of February 18, 1942, to close the gold and silver mines as a means of conserving materials was rejected. Instead, on March 2, 1942, WPB amended Preference Eating Order P-56 so as to deprive gold and silver mines of all priority ratings formerly available to them under that order. This was accomplished by revoking the so-called mine serial numbers of all mines the production of which in dollar value consisted of more than 30 percent of gold and/or silver.
14. Although the amended Order P-56 required the revocation of the mine serial numbers held by gold mines coming within the foregoing 30 percent exclusion clause, in actual practice WPB restored such numbers to mines whose production included significant quantities of materials important to national defense. However, over 200 gold mines, including those of the plaintiffs herein, never again received serial numbers under Order P-56.
15. The amended Order P-56 was the subject of vigorous objections in the mining districts, and public meetings were held in Keno, Nevada, and Denver, Colorado, to protest the amendment. These meetings were attended by the Governors of five states, several United States Senators and Eepresentatives, mine operators, Wilbur Nelson as Chief of the Mining Branch of WPB, and other interested parties.
16. In addition to the aforementioned meetings the 30 percent exclusion clause was the subject of extensive hearings before a special Senate Committee (U. S. Senate, 74 Cong., 2d Sess., Subcommittee of the Special Committee on the Investigation of Silver, Hearings, May 5, 6, 8, and 28, 1942).
17. WPB on May 15, 1942, amended Order P-56 so as to eliminate the 30 percent exclusion clause. However, the amendment effected no practical change, since no person could use the ratings assigned by Order P-56 unless a serial number was granted by WPB. After March 2, 1942, serial numbers were never restored to gold and silver mines producing no substantial quantities of critical materials.
18. By July of 1942, the Labor Division of the War Production Board, and officials of the War Department and the War Manpower Commission, were all becoming concerned with the fact that the production of nonferrous metals in the United States, particularly copper, would not be adequate to meet current and anticipated demands. Investigation revealed that this condition was due not only to the increased wartime demands, but to an alarming shortage of miners in the nonferrous metal mines. The agencies concerned were agreed that the success of the country’s armament program was basically dependent on increased production of basic raw materials such as copper and other nonferrojis metals.
The reasons for the poor production of nonferrous metals were found to be (1) the out-migration of workers in the nonferrous mines to other war industries offering higher wages and better working conditions, (2) drafting of the workers for the armed services by Selective Service, (3) excessive labor turnover within the industry, (4) low morale of the workers, (5) the short workweek in the mines, and (6) the lack of an organized and effective program of recruitment of workers for this industry.
Labor scouts employed by the aircraft and shipbuilding plants were working through the mountain states offering
19. An informal committee organized by officials of the War Department to study the copper shortage situation submitted a report on July 8,1942, recommending a program for dealing with the problem. For the War Manpower Commission it recommended a program for the recruitment of mine labor, involving among other things the expansion of the offices and personnel of the United States Employment Service in the mining areas, and including “a program for the orderly transfer of workers in gold mines and other nonessential industries to the nonferrous mines,” as well as assistance in securing Selective Service deferments for mining occupations. For the WPB, the report recommended a Labor-Management Production Drive Committee to secure increased production through improved morale and greater efficiency; the report then recommended that:
2. Production of gold, with the exception of required amounts of essential silicious gold ores, should be curtailed by an order of the War Production Board to free labor which is urgently needed in the nonferrous mines which are essential to the war effort. * * *
For the War Labor Board the recommendation was that in the cases then pending before it, involving about half of the copper-mining industry, it give careful consideration to the wage differential problem. The recommendations for the Army and Navy were the establishment of morale building programs for the miners and the exertion of influence on their contractors to prevent further recruitment from the nonferrous mines.
20. The Labor Production Division
The above memorandum described the large turnover in employment in the copper mines and the steady decline in over-all employment; it noted that most of the men leaving the copper mines were going into war plants or were being drafted into the armed services, and that the companies were requesting permission to hire Japanese and Mexican labor in their operations. The memorandum concluded as follows:
Steps should be taken to remedy the critical labor situation in nonferrous metal mining, including arrangements for the transfer of miners from gold and silver mining to copper, lead, zinc, tungsten, chrome, and molybdenum mining. This can be done through curtailment of gold and silver production, but it would be necessary to make sure that the workers released went into nonferrous metal mining and did not go into war plants in the vicinity or on the West Coast. It has been customary for metal miners in the mountain states to*72 move considerable distances with the opening and closing of mines and ordinary turnover.
21. On July 9,1942, the General Counsel of the War Manpower Commission sent to a member of his staff a memorandum concerning the possibility of transferring gold miners to work in the nonferrous metal mines. The memorandum stated:
At a meeting of the War Manpower Commission yesterday, the following problem was referred to this office.
General McSherry [Director of Operations of WMC] wishes to secure the release of men employed in the gold mining industry for transfer to the copper mining industry. Concededly the War Manpower Commission cannot accomplish this result directly. May the result be accomplished (1) by the War Production Board refusing to the gold mine operators critical materials used in their operations thus compelling the closing of the mines(2) may the Chairman of the War Manpower Commission direct the War Production Board to take that action %
The specific situation suggested is simply illustrative of the general problem in this field.
22. The proposal for closing the gold mines in order to divert their miners to nonferrous metal mines was gaining momentum in August 1942, and accordingly, Wilbur Nelson, Chief of the Mining Branch, WPB, who was not in sympathy with the method of the proposed plan, expressed opposition to it on August 14,1942, in a memorandum to H. O. King, Chief of the Copper Branch, WPB, reading in pertinent part as follows:
The Mining Branch views with serious alarm the dissipating of the only appreciable reserve of highly competent mining labor through the hasty closing of the gold mines in the United States.
The gold and silver miners constitute the last reservoir of the skilled mining labor. We must, therefore, be certain that that labor is directed toward the most critical points before permitting it to be disbursed. [Sic.]
The present critical situation developed when copper, lead, zinc, mercury and other miners left their jobs and went to the West Coast on shipbuilding and on aircraft jobs, and into the mountain areas in new war industries work.
*73 If we close down the gold mines while these same opportunities are available for work at substantially high rates of pay in other war industries, the miners will not move to a copper, lead, or zinc mine but will do just as their predecessors have done, move on to other more fruitful jobs on the coast.
Logic dictates this, for when a copper miner at Butte is willing to leave his home and go to the coast, I am sure that a gold miner, living in the excellent living conditions at Lead, is not going to leave his family and stop at Butte if he could go to the west coast.
* # * % #
23. Late in August 1942, Guy N. Bjorge, General Manager of plaintiff Homestake Mining Company, the largest gold-mining company in the United States, learned that consideration was being given by the Government to a proposal to close domestic gold mines in order to divert their miners to the nonferrous metal mines. He therefore went to Washington and conferred with several officials of WPB, including Donald Nelson, Chairman, and Wilbur Nelson, Chief of the Mining Branch, as well as Brigadier General McSherry, Director of Operations of the War Manpower Commission, and Lieutenant General Somervell, commanding the Services of Supply, War Department. In the course of these conferences Mr. Bjorge furnished figures as to the small number of men who might be obtained for work in the copper mines by such order. He pointed out that many men had already left the Homestake Mine in 1942 for the same reasons that men had left the copper mines, mainly to accept employment at West Coast aircraft factories and shipyards. Mr. Bjorge also pointed out that the miners remaining at Plomestake were an older, more stable class of men, a large percentage of whom were home owners, and asserted his belief that it was improbable that they would leave their homes for the poor housing facilities and undesirable working conditions at the nonferrous metal mines.
24. On August 26,1942, United States Senator Pat McCar-ran of Nevada wrote a letter to Donald Nelson, Chairman of WPB, setting forth various reasons why he believed the proposed closing of the gold mines would not accomplish its purpose of obtaining any considerable number of miners for
*****
In the first place, the transfer of necessary labor from closed gold and silver mines to mines producing copper, lead, zinc, etc., would be negligible, due to the fact that very few operations exist today where only gold and silver are mined, and in these districts (mainly, the Homestake Mining activity in South Dakota and the Mother Lode Mining district in California), the number of men who could be so transferred is small. Many of the usual workers have joined the armed forces; many are familiar only with the routines of this type of mining and cannot be successfully transplanted. Thus little good would result and great hardships would be inflicted upon affected families and communities.
Secondly, there is no rule or procedure by which such workers could be legally forced to transfer to other mines. The labor that would be denied employment by reason of the shutting down of the mines producing gold and silver would most likely go to the places where they would receive higher wages than are paid in mines.
* * * ❖ #
On September 1, 1942, Donald Nelson replied to Senator McCarran in pertinent part as follows:
*****
A serious study has been and is being made of sources from which mine labor could be made available to the nonferrous metal mines. Naturally, our thoughts have included gold mines, but we have not at this time reached any conclusion thereon.
We quite agree that no legal power exists today by which workers may be forced to transfer to other mines. This accentuates the mine labor problem which faces us today.
Because of your experience in mining matters, and the factual evidence you secured in your recent hearings in the West, I am asking our people responsible for mine production to carefully consider your suggestions.
*****
25. The minutes of the War Production Board for the meeting held September 1,1942, provide in part as follows:
1. Labor Supply for Copper, Lead, and Zinc Industries The Chairman stated that since the labor supply in*75 the copper industry had reached a critical stage and already had resulted in a decline in the production of copper, he had asked the Labor Production Division and the Copper Branch to report to the Board on the manpower problem in the nonferrous metals industries (Doc. 135).
Mr. King reported that 6,000 miners have.been lost by the copper, lead, and zinc mines to other industries during the past several months and that the shortage of labor will become increasingly acute next year when new facilities will require 2,000 additional miners. Preliminary reports indicate a shortage of 2,100 workers in smelters and refineries. Mr. King pointed out that the loss of 5 or 6 thousand workers at the copper mines might so influence the subsequent fabricating processes that 100 thousand workers in war plants at the end product state would be affected. Although monthly production of copper increased steadily from early 1941 to a peak of 95,000 tons in May and June 1942, output in July dropped 5,000 tons to 90,000. The copper outlook is even more critical than shown by the drop in production, since at many mines labor is being transferred from developmental and stripping operations, necessary to provide for future production, to current ore extraction. The position of the smelters and refineries is exemplified by a smelter at Tacoma where output of 2,000 tons of copper per month is being lost for lack of only 300 unskilled common laborers. Mr. King emphasized that production at the mines, smelters and refineries will continue to fall unless the exodus of labor is checked and the supply of workers augmented. Output of lead and zinc likewise declined in July, and the labor-production situation in these metals is similar to that in the copper industry.
Mr. Lund pointed out that there is general agreement that the higher wages paid to workers in competing occupations in other industries are the prime factor causing the out-migration of labor from the mines and mills. Average weekly earnings in April of 37.28 dollars for mine workers and 35.18 dollars for smelting and refining workers compared with an average of 53.30 dollars in shipbuilding and 45.94 dollars in aircraft, the principal competing industries. Corollary factors in the out-migration of workers have been rumors of ceilings on wages and proposals to confine workers to their present jobs, the hazards of mining, and inadequate housing and transportation facilities.
*76 Mr. Lund pointed out that the decision of the War Labor Board, expected within a month on BO or 40 cases involving higher wages for copper miners, will have an extremely important bearing on the out-migration problem.
Mr. King reported that following a resolution of the War Production Board (See WPB Minutes, March 3, 1942, Item 7), labor-management committees were established in the metal mining areas and the importance of having mine workers stay at their jobs was publicized. On June 13, 1942 the Chairman of the War Production Board formally launched the War Production Drive in the nonferrous metals industries by a radio address to the miners at Butte, Montana.
As further steps in halting out-migration, the InterDepartmental Committee on Nonferrous Metals was established on August 11 and various letters and literature have been prepared for distribution to mine operators and labor unions; an order has been prepared to prohibit the use of materials in nonessential gold mines, which may free about 8,000 workers; plans to prevent employment of miners on Army and Navy construction projects are being considered; and training programs are being introduced into mining properties. To increase the efficiency of present working forces, mine equipment is being accorded high priority ratings, and labor is being trained and upgraded by improving working and living conditions, and by lowering age and other restrictions on hiring. Mr. Lund observed that in many cases labor standards have shown no change from those existing in normal times when a surplus of labor is available. He suggested that the pooled employment interviews which the War Manpower Commission is now conducting in some parts of the country should be pursued with increasing vigor.
Mr. Lubin inquired if the order to prohibit the use of materials in nonessential gold mines had actually been issued and, if not, what steps are being taken toward its issuance. Mr. King, replied that a first problem is to define a nonessential gold mine since gold is frequently found in association with other metals and it is necessary to avoid denying materials to mines that produce important quantities of critical metals jointly with gold. It is hoped that an appropriate definition can be developed very shortly and an order issued promptly thereafter.
*77 The Chairman remarked that since other uses have been cut to a minimum, the major use of copper is in munitions, especially small arms ammunition, and any reduction in the copper supply will be reflected in a reduced output of ammunition. He expressed the belief that the War Production Board must take an active and leading role in assuring an adequate supply of copper and Mr. Lubin added the suggestion that the concern of the War Production Board in this problem is sufficiently great to establish its own employment offices, if this is necessary to obtain additional copper miners.
After further discussion it was agreed that:
Inadequate production of copper, lead, and zinc will result inevitably in reduced output of munitions, including small arms ammunition needed by the fighting forces. The output of these metals is now being reduced by a shortage of manpower in mines, smelters and refineries.
The War Production Board is charged with the primary responsibility for providing the maximum possible production of critical metals, but the solution of the problem of assuring a sufficient supply of labor involves the responsibilities of other agencies of the Government as well. The coordination of the efforts and activities of other agencies of the Government with those of the War Production Board is needed, therefore, to ensure an adequate supply of critical metals.
The War Production Board urges all agencies involved to promote and support such actions as may be necessary to provide to nonferrous mines, smelters, and refineries a supply of labor adequate for the maximum possible output of such metals. It is especially important that the facilities of the United States Employment Service be expanded and strengthened to meet this particular need.
♦ ‡ ❖
The Chairman referred to above was Mr. Donald Nelson, Chairman of the War Production Board. The Mr. King referred to was Mr. H. O. King, Chief of the Copper Branch, Industry Operations, WPB. The Mr. Lund referred to was Mr. Wendell Lund, Director of the Labor Production Division, WPB. The Mr. Lubin referred to was Mr. Isadore Lubin, acting for Mr. Harry L. Hopkins, Special Assistant to the President.
27. On September 9, 1942, Mr. R. J. Lund, Chief of the Miscellaneous Minerals Branch, sent the following memorandum to Mr. A. I. Henderson:
At a meeting held in your office on September 4, attended by Messrs. Dodge and Scribner of your staff, Mr. Parks of the Miscellaneous Minerals Branch, and Mr. Stow of the Mining Branch, you issued instructions that an order be drawn up either by the Miscellaneous Minerals Branch or the Mining Branch which would curtail the output of gold and which would not be connected with Order P-56. You indicated that this Branch should prepare the order but that the order could be administered by this Branch or the Mining Branch as later determined.
It was understood that the purpose of the order was to make mining labor now producing gold available to copper and other strategic nonferrous metal mines. This end can be attained by WPB only through its authority to control materials.
Attached is copy of the order6 for your consideration. This order has not been circulated, except in discussions with the Mining Branch.
The order is designed to close all mines producing gold to the extent of 50 percent or more of the value of the total output. In considering the order the following matters are pertinent:
(1) Number of mines affected
Based on 1940 production figures obtained from the Bureau of Mines, the latest they were able to supply, about 220 lode mines will be affected by the order. This figure is not exact, because production in the 1941 or 1942 base period specified in the order is not strictly comparable with the 1940 picture. Geographic distribution of these lode gold mines is as follows: California, 58; Colorado, 32; Montana, 30; Nevada, 27; Arizona, 18; Alaska, 12; Idaho, 12; Utah, 8; South Dakota, 6; with the remainder distributed among five other states.
*79 Detailed data on placer operations affected by tbe order are not presently available, but the Bureau of Mines reported that in 1940 a total of 3,107 placer mines produced gold and silver in the United States, and 1,069 in Alaska. Undoubtedly, sizable numbers of these produced such small quantities that they would be exempted by the order.
The Bureau of Mines reported that in 1940 there were 49 connected-bucket floating gold dredges operating in Alaska, 46 in California, 12 in Idaho, 7 in Montana, 6 in Oregon, 1 in Colorado, and 1 in Nevada. In addition there were large numbers of mechanized placer operations using drag line and power-shovel excavators, but no separate figures on these operations are available.
(2) Labor involved
Based on 1941 data, latest available from the Bureau of Mines, approximately 12,400 employees in lode gold mines will be thrown out of work by the order. Incomplete data indicate that about 70 percent of this labor is employed underground. Geographic distribution of this total labor was as follows: California, 3,394; South Dakota, 2,123; Colorado, 1,689; Alaska, 1,251; Arizona, 911; Montana, 602; Nevada, 601; Idaho, 590; Utah, 484; with the remainder distributed in a number of Western and Eastern states.
No detailed data are available showing number of employees in placer operations, except that the number would probably amount to at least several thousand in the United States and perhaps two thousand in Alaska.
(3) Estimated recaptwre of employees affected
Assurances were given by General McSherry at a meeting of the Interdepartmental Committee on Non-Ferrous Metals, September 8, that the U. S. Employment Service had adequate staff available to go immediately into the several hundred mining camps which might be affected by the gold curtailment order and to recruit labor for transfer to copper mines and other nonferrous metal mines in dire need of such labor. At a previous meeting of this Committee, an estimate was made that about 25 percent of the mine labor might be recaptured for work in other mines.
*80 (4) Other metals lost
Production of other metals in 1940 by mines affecfed is as follows; copper, 2,751,000 pounds; zinc, 92,000 pounds; lead, 12,047,000 pounds; silver, 4,947,000 ounces. Other metals such as antimony, arsenic, tungsten, molybdenum and manganese are also produced in minor amounts by some of these mines.
(5) Fluxing ore problem
Seme gold mines affected by the order produce large tonnages of siliceous ore required by smelters working primarily on other nonferrous metals, such as copper, lead and zinc. This flux is necessary to their operation, and gold values in the flux naturally make operations more economical than by adding barren siliceous material which may, or may not, be available at the smelter.
(6) Critical materials saved
Sizable amounts of critical materials will be saved in closing these gold mines. Estimates as to total current consumption of such materials are not available but the general order of magnitude of such consumption is indicated by the fact that in 1939 gold mines in the United States (excluding Alaska) spent about $17,000,000 on supplies and materials, $2,000,000 for fuel and about $5,000,000 for purchased electric energy.
(7) Effect on economy of states and communities
Shutting down the operations at mines affected by the order will result in loss of sizable tax revenues, in respect to state tax revenues alone, in some of the states involved. There has been insufficient time to obtain complete data on this point, but two examples are cited as follows: (a) In South Dakota, total state taxes collected in fiscal year 1941, exclusive of motor fuel taxes, amounted to $11,700,000; taxes paid to the state by mines in South Dakota affected by this order amounted to $1,000,000, or about 9 percent of the total; (b) in Nevada total taxes collected in fiscal year 1941, excluding motor fuel taxes, amounted to $3,300,000, of which about $65,000, or 2 percent, was collected from mines affected by this order.
Losses in county and municipal taxes will be felt much more severely by the communities in the vicinity of the mines. In this respect, shutting down*81 mining operations is not comparable with, shutting down other industrial operations in communities where enterprise is diversified; in the West it is generally true that the mine is the sole major source of income for local communities. For example, it has been reported that the Homestake Mining Company pays 65 percent of the local community taxes and 50 percent of the county taxes; tnat the wage earners and those servicing them pay the balance largely from the $4,500,000 in annual wages paid by the company. At least 19,000 people, the population of the county, are directly or indirectly dependent upon its operation.
For reasons stated in the last paragraph, hardships faced by old established mine employees will be severe. There is virtually no possibility of converting the facilities at the mines to war work.
(8) Probable loss of deep mining operations and dredging equipment
Although the order permits gold mining companies to maintain buildings, machinery and equipment in repair, and to keep access and development workings in a safe and accessible condition, it is probable that most of the deep mines situated in heavy, caving ground will be unable to take full advantage of these provisions in the order. As a result it is probable that many of these old, deep mines may never be reopened.
Costly dredging equipment forced to lie idle will be subject to more rapid depreciation than if it were maintained in operation.
The suggestion was made at a meeting this morning that the order should be tightened further by lowering the exemption from the 4,000-ton figure to 1,500 tons annually, or a monthly rate of 100 tons. Such a change would result in a large increase in the nmnber of mines affected by the order, in the total labor involved, and in items 3 to 6, inclusive, discussed above. Tabulations covering these smaller operations are just now being made, so details in respect to these items cannot be presented herewith. The order will be modified to the lower exemption figure before clearance, if these studies indicate a considerable amount of labor involved.
A factor which would tend to lower the number of mines affected, labor involved and other items discussed above, is the fact that many of the gold mines affected by the order have already been forced to curtail or close
There is, of course, an appeal provision in the order, through which, again, the number of mines, number of employees, other critical materials and fluxing ores affected will be lowered from the estimates cited in items 1 to 5 above.
Concluding Statement
Administration of an order such as the above, entirely divorced from provisions of Order P-56, necessarily involves duplication of work, both here in Washington and in the companies affected by the order. Those gold mines producing needed metals and fluxing ores will have to submit an appeal under the provisions of the order before they can be exempt. There is no practicable way of defining, in an order, such mines that should be exempted. This appeal procedure duplicates, in large measure, the appeals that were already made under the administration of P-56, and it is likely that the repercussions throughout the mining industry of such duplication of effort will be unwholesome.
Without using the mine serial numbers already established as a means for determining essential mining operations, there appears to be no alternative other than to use a percentage value basis in defining gold mines, and to provide for continued operation of essential ones through an appeal procedure.
Other pertinent considerations are presented in the attached memorandum to you from Dr. Wilbur Nelson, and I suggest that they be given careful attention.
The adverse repercussions mentioned above might be overcome in some measure by including an additional provision in the accompanying order which would automatically exempt those gold mines now having serial numbers until they are notified by the Director General for Operations that they are to cease operation. Each of these cases, in the meantime, should be carefully reviewed and judged in the light of the more acute situation now prevailing.
I shall await your written instructions before proceeding further.
In accordance with instructions issued by Mr. A. I. Henderson, you will find attached a copy of the proposed curtailment order on gold. This order is in process of circulation in accordance with the procedure for order clearance and should be presented to the Clearance Committee for action about September 21.
Mr. Henderson requested that the order be prepared in a manner completely divorced from Order P-56. However, in his absence, after a consultation with Mr. H. W. Dodge and Dr. Wilbur A. Nelson, and a meeting with Messrs. Fred M. Eaton, Bichard Lester, and myself, it was determined to be most practical that the order not be divorced from P-56.
The effect of this order will be to close down all gold mines not having a mine serial number, within 30 days from issuance. It is the intention of the Mining Branch to review all mine serial numbers assigned to mines producing 50% or more gold in dollar value and to withdraw such serial numbers unless the balance of the production represents critical materials urgently needed for the war effort in amounts sufficient to justify continuance of the operation.
In addition to the draft of the proposed order, there was also included an explanation of its effect in the following terms:
The Order requires that all mines producing gold, except those having a serial number under P-56, cease operation and development within 30 days after the date of issuance of the Order. The Order makes provision for the minimum maintenance and repair necessary to maintain the mines plant in condition and for the granting of preference ratings to accomplish this after application made to the Director General for Operations.
All gold mines which produce needed quantities of copper, lead, zinc, and other minerals, or of silicious fluxes, already hold serial numbers under Order P-56. Therefore, the mines closed down by this proposed order would be only those which have, after examination by the Mining Branch, already been determined to be nonessential to the war effort.
The result of closing these nonessential mines will be to conserve all the material which they have been*84 using for operational and development purposes. Heretofore they have merely been denied the right to use the high preference ratings granted by Order P-56, but have been able not only to obtain certain material under P-100, but also to use their own inventories.
29. The effect of the proposed limitation order was further summarized in the following terms at about the same time:
A draft of a limitation order on materials and supplies for gold mining is being circulated within the War Production Board. The order provides for complete shutdown of nonessential mines in the United States with the following exceptions:
(1) Mines producing less than 1,200 tons of ore per year will be permitted to continue operations at their rate of operation in 1941 or early 1842. Such mines are usually individual or partnership enterprises worked by men who are not likely to be employed by others.
(2) A limited amount of supplies and equipment will be made available for the purpose of keeping the mines accessible and safe. This is intended to avoid flooding or otherwise damaging mines which would be in a position to produce after the emergency has passed.
A nonessential mine is defined as a mining enterprise in which gold is produced, unless the operator holds a serial number for such enterprise issued under Preference Bating Order P-56, as Amended. Since producers of siliceous fluxing ores and of complex ores containing substantial amounts of critical metals as well as gold have already been granted serial numbers, the order will not affect the production of essential metals.
The basic purpose of this curtailment of gold mining is, of course, to free manpower for the mining of essential minerals, particularly nonferrous metals such as copper, zinc and lead. Because many of the gold mines are located much closer to other mines producing such strategic metals as mercury, molybdenum, tungsten, vanadium, chromium, manganese, etc., it is expected that workers will also be made available to these industries.
The War Manpower Commission through the Employment Service is now taking steps to insure orderly recruiting of these gold miners and to provide for a minimum of delay in reemployment as well as to provide transportation expenses. It is expected that this procedure will make possible the maximum diversion of*85 labor to essential mining industries where their skills can be used to best advantage. ■
Beside diverting manpower to essential industries,, this order, when in effect, will also conserve some materials and supplies used in gold mining, such as mercury, drill steel, etc.
30. The minutes of the Interdepartmental Committee on Non-Ferrous Metals for September 15,1942, provide in part as follows:
$ $ $ $ $
Dr. M. Stow presented a report on the proposed order to curtail gold mining operations. He distributed a copy of the proposed order which, he said, had been, brought up for consideration before the Clearance' Committee.
Dr. Stow explained that the persons responsible for drafting the order favored the method of curtailing gold mines by denying them serial numbers under P-56, rather than the type of blanket order which would shut down any gold mine whose gold ore production was above a stipulated proportion of its total production by dollar value. Under the former type of order the gold mines would be closed by being denied serial numbers under P-56, as a result of which they would be unable to obtain either supplies or equipment and would be prohibited from using their present supplies and equipment.
Mr. Harbison [Army representative] expressed some concern over the delay in issuing the gold order. He outlined the steps that various agencies had taken to meet the manpower shortage in nonferrous metal mines, and pointed out that the transfer of gold miners to essential mining was being held up by the lack of a gold curtailment' order. He pointed out that the U. S. Employment Service had been unable to obtained any recruits at Eapid City, South Dakota, because the gold mines had not been closed down, although Anaconda Copper Mining Company had agreed to pay transportation costs. He made it clear that the War Department was impatient at the delay.
Mr. Lester of the War Manpower Commission asked that his organization be kept informed of what mines would be affected by the directive, in order that representatives of the Employment Service might be on the spot beforehand.
In this connection, since the primary purpose of the order was to free manpower rather than to curtail materials, Mr. Lipkowitz suggested that an advisory com*86 mittee be established with representatives from Labor Production Division and War Manpower Commission.
The meeting was attended by representatives of the various minerals branches, the Mining Branch, the Labor Production Division, and the Legal Division of the War Production Board, as well as representatives of the War Manpower Commission, the Office of Price Administration, and the War Department. Dr. Wilbur Nelson presided at the meeting. Dr. Stow was immediately subordinate to Dr. Wilbur Nelson in the Mining Branch.
31. The draft of the proposed limitation order for the goldmining industry was submitted to Morris Creditor, Special Assistant to Donald Nelson. On September 15,1942, he sent the following comments upon it to Donald Nelson:
I have reviewed the proposed limitation order for the gold mining industry and I wish to raise certain points as to the soundness of such an order.
You will recall that we received a letter from Senator Gurney on August 31 in which he set forth the harmful effects that such an order would have on the economy of the State of South Dakota. In your reply you stated in effect that we were confronted with the manpower problem and something had to be done to overcome the losses of production which are being experienced in the mining of copper and other strategic materials through the shortage of experienced miners.
In the preamble of the limitation order no mention is made of manpower requirements. It simply states that the order is made necessary because of the shortage in the supply of critical materials which are used in the maintenance and operations of gold mines.
It would seem to me that if the order is based on the premise of critical materials alone, the question might be raised as to why such an order would not apply to materials being sent by this country to other gold mines in Canada, South America, and South Africa.
If the main purpose of this order is to divert miners from the gold mining industry to copper and other mining industries, it seems to me that there is no assurance that this order would accomplish the desired results. As Gustav Peck pointed out to you in his memorandum of September 9, it would be too bad to close the Homestake Mine, for instance, without the assurance that most of the miners will continue to practice their trades in the copper mines.
*87 Would it not be more practical to accomplish the purposes by a freeze order similar to that which is now in effect for workers in the copper mines and the lumber industry. This may be more drastic but, on the other hand, may give better assurance that the miners in the gold mines would eventually find their way into the copper mines. Consideration might also be given to the idea of having the Army give indefinite furloughs to Service men who in the past were engaged in the mining of nonferrous materials.
Even aside from the possible dissipation of these skilled miners into other occupations, there is a question whether the closing of all the gold mines will release any relatively large number of workers. As I understand it, in the case of Homestake Mine the proposed order would affect only about 450 miners. This is the largest gold mine and has from a third to a half of all the miners to be released. The Alaska-Juneau miners, incidentally, will be stuck in Alaska. Where are they expected to go?
I am sure that a great deal of thought has been given to the proposed limitation order on gold mining, but unless there is a high degree of assurance that the main purpose will be accomplished; namely, the diversion of these miners to the nonferrous mines, I feel it is important to weigh the adverse effects it might have in other directions.
Actually, only a small amount of critical materials is used in gold mining. Hence, if it is contemplated to issue the order in its present form, the preamble should give the real reason; which is to divert this labor to more necessary industries.
32. On September 17, 1942, Mr. J. M. Scribner, assistant to Mr. A. I. Henderson, sent the following memorandum to Dr. Stow of the Mining Branch:
Acting in accordance with instructions received from Mr. Donald Nelson’s office this morning, please be advised that the gold order is to be cleared with all of the branches involved as promptly as possible, but it is not to be presented to the Clearance Committee for clearance until further word is received from Mr. Nelson’s office.
The order is to be held in the branch in such shape that it may be presented to the Clearance Committee for action immediately upon advice from Mr. Nelson’s office that it is to go through.
A. Where possible, existing organizations may be utilized for important mining operations, or prospective operations, necessary in the war effort.
B. Labor, and especially experienced miners, can be made available to the mining industry, rather than lost to vital metal production.
34. On September. 25, 1942, William L. Batt, Vice Chairman of WPB, sent a memorandum to A. I. Henderson, Deputy Director General for Industry Operations, WPB, which stated, inter alia:
I have told the Chairman that my judgment is that the limitation order on gold mining should be released at the appropriate time, and he has agreed. It was the consensus of opinion that we should wait until the War Labor Board had acted on certain wage matters, and I shall expect to be advised when the situation is clear on this point.
It seems to me imperative that we very carefully word our press release so that the predominant objective, namely of releasing less essential labor for more essential requirements, shall be clearly evident. And I particularly direct the attention of those who have to do with this matter at this point.
35. On September 30, 1942, a conference was held in Mr. Batt’s office. Senator McCarran of Nevada and Senator Gurney of South Dakota, as well as Congressman Engle-bright of California, and Congressman Case of South Dakota, attended. Samuel Hill of the War Manpower Commission and members of the WPB staff, including Wilbur Nelson and Samuel Lipkowitz, also attended. The Members of Congress spoke of the hardships that would be imposed on the inhabitants of the gold-mining communities and of the detrimental effects on the morale of such people if the mines should be closed down by the issuance of a WPB order. The
36. On September 29,1942, at the direction of W. L. Batt, Wilbur A. Nelson telephoned the following representatives of the gold mining industry and requested them to attend a meeting in Washington: Guy N. Bjorge, General Manager of Homestake Mining Company, Errol MacBoyle of Idaho Maryland Mines Corporation, Merrill Shoup of Golden Cycle Corporation, Carroll Searles of Newmont Mining Corporation, and Thomas McCormack of the Natomas Company. The meeting took place on October 1st and lasted for approximately five hours.
Those in attendance at the meeting included W. L. Batt, Wilbur A. Nelson, Allen Buchanan and Samuel Lipkowitz of WPB’s Labor Division, Messrs. Hill, Harbison, Ayer, Hayes, Heikes and Hatch, General Lucius Clay representing the War Department Services of-Supply, General Frank J. Mc-Sherry of the War Manpower Commission, Senator Chan Gurney and Kepresentative Francis Case of South Dakota, Representative Harry Englebright of California, and the five aforementioned representatives of the gold mining industry.
At the opening of the meeting Mr. Batt stated that he had brought the gold mine operators to Washington to tell them that a decision had been made to close the gold mines in order to transfer the released labor to the copper mines. In justification of such an order, Mr. Lipkowitz of WPB’s Labor Division stated that there were between 10,000 and 12,000 men who were then employed in the gold mines. The gold mine owners immediately protested that the figures stated were completely inaccurate; that the gold mines had already lost their most active men who had either gone to the shipyards and aircraft plants on the West Coast or had been drafted into the Armed forces; that the miners remaining in the gold mines were settled residents of their communities and that it was doubtful that they would move away to work in the copper mines if the gold mines were closed.
37. On October 3,1942, Wilbur Nelson furnished Mr. Batt with figures which he had obtained directly from the gold mine operators. He reported that while there were 3,270 workers employed by gold mining companies at that time, only 896 of them were hardrock miners and muckers. He further reported that approximately 300 of these men would be needed to maintain the buildings, machinery and equipment in repair, and the access and development workings safe and accessible as provided for under the proposed order. His report concluded that if all the gold mines and dredges in the United States were put on a stand-by basis, it would make available only about 600 miners and muckers for other mining enterprises “provided they [could] all be induced to go into other mines.”
38. On October 1,1942, Mr. Batt sent the following memorandum to Donald Nelson, Chairman of the WPB :
The more I study the gold mining situation, the more uncertain I am as to the form which a restriction of operations should take. Complete closing without exceptions will produce very serious economic dislocations, and the total possible gain in men is a small figure. If*91 tbe question comes up in your press conference, I would suggest that you refer to the need for miners and the lack of need for gold, and say that the matter is being studied from all angles.
39. On October 2,1942, Under Secretary of War Kobert P. Patterson sent Mr. Batt the following letter:
I hope that prompt and effective action will be taken with regard to gold mining. I need not call your attention to the urgent need for more miners in the production of copper and other nonferrous metals as you know the situation as well as I do. The longer the delay in shutting down gold mining, the further off will be the relief of the copper shortage. The matter has hung fire for some time, and I trust that there will be no further delay.
If it is thought best to have the order approved by the War Department and the Navy Department, I will be glad to give the War Department’s approval, and I believe that Mr. Forrestal will do the same for the Navy.
40. On October 5,1942, Under Secretary of War Patterson and Under Secretary of the Navy Forrestal sent the following memorandum to Donald Nelson:
The case of gold mining presents sharply the question whether we mean business or not in doing everything possible to push war production.
There are two thousand to three thousand hard-rock miners engaged in gold mining, now of no use in war production. These men could help out substantially in relieving the labor shortage in copper mining. They will not help out in copper mining so long as gold mining is carried on.
The present situation in production of copper, due to shortage in the supply of miners, is so alarming that the Army is about to furlough soldiers to go back to work on mining of copper. This is a hard step for the Army to take. But the effect of this step and others will not give complete relief if nothing is done to transfer gold miners to copper mining.
The matter has hung fire for some time. We deem it of the utmost importance that prompt action be taken and that half measures be avoided.
41. The matter was presented to the War Production Board at its meeting on October 6, 1942. The minutes of that meeting, insofar as here material, and which accurately reflect what transpired, read as follows:
*92 Mr. Batt reported that the matter of shutting down United States gold mines had been receiving detailed attention. On conferring with Brigadier General Mc-Sherry of the War Manpower Commission and representatives of the gold mining companies, it had been found that at present the gold mining industry employs 3,270 workers; 750 are engaged in dredging and only 896 are hard-rock miners. Loss of labor to the Services and to war industries, and higher costs have already sharply curtailed operations of all domestic mines except Homestake. Homestake’s labor force has dropped from a peak of slightly over 2,000 workers to 1,876, including lumbermen and machine shop workers. If Homestake were shut down except for standby operations, all but 500 of these workers could be released for work elsewhere. Lead and Deadwood, South Dakota, with aggregate populations of 16,000 are totally dependent on the mine’s operation.
Although it has recently emphasized other forms of production, the State Department, because of broad international considerations, heretofore has urged that gold mining in South Africa and Honduras be maintained. The South African economy and the stability of the present government are largely dependent on gold mining. The basic industries of Honduras are the cultivation of bananas, of which exportation to the United States has been reduced to 20 percent of normal, and gold mining. Mr. Leon Henderson reported that Canadian gold mining is being curtailed very sharply. The Vice President pointed out that questions pertaining to production of gold abroad should appropriately be discussed with the Board of Economic Warfare.
Mr. Batt stated that after investigation he recommends that: (1) All nonessential domestic mining of gold other than that incident to the mining of critical metals be stopped as soon as possible and not later than within 60 days; and (2) gold mines not producing critical metals be allowed to continue standby maintenance operations lest it be impossible to reopen them at the close of the war.
General Somervell stated that because of the critical shortage of copper, which is drastically' curtailing ammunition production, the Army has taken the unusual precedent of furloughing 4,00(5 soldiers to work in the copper mines and- that, under these conditions, failure to stop gold production immediately would be inexcusable.
After further discussion it was agreed that:
*93 An order shall be issued by the War Production Board stopping all nonessential domestic gold mining operations within 60 days and thereafter permitting only minimum maintenance to keep mines dewatered and in standby condition.
42. Those in attendance at the October 6,1942, meeting of WPB to consider the gold closing order included Donald M. Nelson, W. L. Batt, A. I. Henderson, Wilbur A. Nelson, Under-Secretary of War Robert P. Patterson, Lieutenant General Brehon B. Somervell, and Paul Y. McNutt, Chairman of the War Manpower Commission. The meeting was also attended by numerous other persons who were there for the purpose of considering the so-called feasibility program. The gold curtailment order was discusssed for some fifteen to thirty minutes and it was decided to issue the gold closing order immediately.
43. On October 8,1942, the Y7PB issued Limitation Order L-208 directing that operations at gold mines not holding serial numbers under Order P-56 be discontinued. Order L-208 read as follows:
The fulfillment of requirements for the defense of the United States has created a shortage in the supply of critical materials for defense, for private account and for export which are used in the maintenance and operation of gold mines; and the following order is deemed necessary and appropriate in the public interest and to promote the national defense.
Section 3093.1 — LIMITATION ORDER L~m
(a) Definitions. For the purposes of this order, “nonessential mine” means any mining enterprise in which gold is produced, whether lode or placer, located in the United States, its territories or possessions, unless the operator of such mining enterprise is the holder of a serial number for such enter-Srise which has been issued under Preference 'ating Order P-56.
(b) Restrictions upon production.
(1) On and after the issuance date of this order, each operator of a nonessential mine shall immediately take all steps as may be necessary to close down, and shall close down, in the shortest possible time, the operations of such mine.
(2) In no event on or after 7 days from the issuance date of this order shall any operator of a non*94 essential mine acquire, consume, or use any material, facility, or equipment to break any new ore or to proceed with any development work or any new operations in or about such. mine.
(3) In no event on or after 60 days from the issuance date of this order shall any operator of a nonessential mine acquire, consume, or use any material, facility, or equipment to remove any ore or waste from such mine, either above or below ground, or to conduct any other operations in or about such mine, except to the minimum amount necessary to maintain its buildings, machinery, and equipment in repair, and its access and development workings safe and accessible.
(4) The provisions of this order shall not apply to any lode mine which produced 1200 tons or less of commercial ore in the year 1941, provided the rate of production of such mine, after the issuance date of this order, shall not exceed 100 tons per month, nor to any placer mine which treated less than 1000 cubic yards of material in the year 1941, provided that the rate of treatment of such placer mine, after the issuance date of this order, shall not exceed 100 cubic yards per month.
(5) Nothing contained in this order shall limit or prohibit the use or operation of the mill, machine shop, or other facilities of a nonessential mine in the manufacture of articles to be delivered pursuant to orders bearing a preference rating of A-l-k or higher, or in milling ores for the holder of a serial number under Preference Rating Order P-56.
(c) Restrictions on application of preference ratings. No person shall apply any preference rating, whether heretofore or hereafter assigned, to acquire any material or equipment for consumption or use in the operation, maintenance, or repair of a nonessential mine, except with the express permission of the Director General for Operations issued after application made to the Mining Branch, War Production Board.
(d) Assignment of preference ratings. The Director General for Operations, upon receiving an application in accordance with paragraph (c) above, may assign such preference ratings as may be required to obtain the minimum amount of material necessary to maintain such nonessential mine on the basis set forth in subparagraph (b) (3) above.
*95 (0) Records. All persons affected by this order shall keep and preserve, for not less than two years, accurate and complete records concerning inventory, acquisition, consumption, and use of materials, and production of ore.
(f) Reports. All persons affected by this order shall execute and file with the War Production Board such reports and questionnaires as said Board shall from time to time prescribe.
(g) Audit and inspection. All records required to be kept by this order shall, upon request, be submitted to audit and inspection by duly authorized representatives of the War Production Board.
(h) Communications. All reports to be filed, appeals, and other communications concerning this order should be addressed to:
War Production Board
Mining Branch
Washington, D. C. Ref: L-208
(i) Violations. Any person who wilfully violates any provision of this order, or who, in connection with this order, wilfully conceals a material fact or furnishes false information to any department or agency of the United States, is guilty of a crime, and upon conviction may be punished by fine or imprisonment. In addition, any such person may be prohibited from making or obtaining further deliveries of, or from processing or using, material under priority control and may be deprived of priorities assistance.
(3) Appeal. Any person affected by this order who considers that compliance therewith would work an exceptional and unreasonable hardship upon him may appeal to the War Production Board, by letter, in triplicate, setting forth the pertinent facts and the reason he considers he is entitled to relief. The Director General for Operations may thereupon take such action as he deems appropriate.
(k) Applicability of Priorities Regulations. This order and all transactions affected thereby are subject to all applicable provisions of the Priorities Regulations of the War Production Board, as amended from time to time.
(P. D. Reg. 1, as amended, 6 F. R. 6680; W. P. B. Res:. 1, 7 F. R. 561: E. O. 9024, 7 F R. 329; E. O. 9040, 7 F. R. 527; E. O. 9125, 7 F. R 2719; sec 2 (a), Pub.*96 Law 671, 76th Cong., as amended by Pub. Laws 89 and 507, 77th Cong.)
Issued this 8th day of October, 1942.
Ernest Kanzler
Director General for Operations
44. Coincident with the issuance of L-208, the War Manpower Commission issued a directive relating to the employment of workers previously employed as production or maintenance workers in gold mines. This directive was issued on October 7, 1942, by Paul V. McNutt, Chairman, and stated in material part as follows:
I. On and after the date hereof no employer shall hire-in, or hire for work in, Alaska or any State west of the-Mississippi Eiver, any person who on or after October-7, 1942, has ceased to be employed as a production or maintenance worker in connection with gold mining; except upon referral of such worker to such employer by the United States Employment Service.
II. No person who on or after October 7, 1942, has-ceased to be employed as a production or maintenance-worker in connection with gold mining shall be referred by the United States Employment Service to any work in Alaska or a State west of the Mississippi Eiver other than work in essential nonferrous metal mining, milling,, smelting, and refining activities unless such referral would be in the best interests of the war effort or unless-the denial of such referral would entail an undue hardship upon the individual concerned, as determined in-accordance with regulations and standards prescribed by the Chairman of the War Manpower Commission.
45. Immediately following the issuance of Order L-208 on October 8, 1942, a statement was issued by Paul V. McNutt,. Chairman, War Manpower Commission, and Donald Nelson, Chairman, WPB, appealing to all workers in gold mines to transfer to nonferrous metal mines and not to other war industries.
46. The dominant consideration by Chairman Donald Nelson of WPB in the issuance of Limitation Order L-208 was-the releasing of mine labor from the gold mines for employment in mines that were producing other metals, such as copper, which were in short supply and urgently needed in the-war program.
48. Although the preamble to the order stated that it was issued to conserve critical materials, supplies and equipment needed for defense and in short supply, the only part of the order itself which attempted to effect such a conservation was that part which prohibited the gold mines from acquiring such materials, and that acquisition had already been effectively curtailed and in large part cut off by existing priority orders (finding 17). That part of the order which prohibited the use by the gold mines of the supplies, materials and equipment and facilities they owned and had on hand did nothing to assure that those materials, etc., would be available for use by more essential industries of by the Government. The order left the owners free to dispose of them as they pleased.
49. Prior to the issuance of L-208, and afterwards until the end of the war, critical materials, machinery and equipment subject to allocation and control by WPB were shipped in substantial quantities to foreign countries for use in their gold mining industry. These countries included South Africa, Canada, Honduras, Nicaragua and Columbia, in all of which gold mines continued to operate throughout the war.
50. On and prior to October 8,1942, officials of WPB who were responsible for the issuance of L-208 knew (1) that existing priority orders insured that the gold mines would not receive any critical materials needed by more essential
51. It is reasonable to conclude that in issuing L-208 WPB acted without any justifiable anticipation that the order would bring about the transfer of more than an insignificant number of hardrock miners to the nonferrous metal mines.
52. On October 10,1942,21 United States Senators from 12 gold-producing Western States sent the following letter to the President of the United States:
Some days ago the War Production Board announced a decision to close all gold mining operations in the United States. This order was made by the Board against the emphatic protest of those representing the largest mining operations engaged in the mining of gold from lode and placer operations.
The largest mining operations affected by this order are in the states of South Dakota, California, and Colorado.
*99 The Homestake Mine in South Dakota has been operating for some sixty years and has supported a community immediately surrounding the operation of some sixteen or eighteen thousand souls.
The Mother Lode Mines in California extend along the western base of the Sierra-Nevada range of mountains for a distance of 150 miles or more. These mines have been depended upon by communities the total of which would approximate one hundred thousand souls.
The population dependent on the Cripple Creek Mines of Colorado has varied from time to time and is not definite at this moment. Suffice it to say that it would be in the neighborhood of five or six thousand souls.
The economy of communities and states in which these mining operations are located has depended largely upon these operations, in that all of these mines have contributed materially by way of taxation to the states, counties, and municipalities in which they are located.
The labor employed by these mining operations in the respective states has been to a very large extent contributed by the communities that surround the respective mine operations. Homes have grown up through the years in each of these communities, and sons followed their fathers into the mines.
The record made before the War Production Board discloses that in each of these mining communities the young men, that is, men under 50 or thereabouts,- have already either gone into the military branches of the United States, or have gone into war activities where alluring wages attracted them. The record discloses that the men now engaged in mining operations in the mines affected by the order are by and large about 50 years of age or over. The record before the War Production Board discloses that the men now engaged in mining operations in these localities have, with but rare exception, been employed in the mines of the respective localities for many years.
It is stated that the object of the order made by the War Production Board closing down these gold mines is because of a shortage in the supply of critical materials for defense, and the making of the order is supported by the theory that the labor employed in these gold mines will go into mines of copper or lead or zinc.
We respectfully draw your attention, Mr. President, to the record as made before the War Production Board that if all of the gold mines affected by the order of the Board are put on a standby basis, that is, if they are*100 Eermitted to retain only enough labor to keep the mines :om becoming flooded and caved, there will be in all about 2,020 of all types put out of employment.
The record before the Board shows that there may be another 500 men put out of employment from other mines of smaller capacity, making a total of 2,520 men put out of employment from lode mines.
It is estimated that the number of men put out of employment from dredger operations will be about 750 men. The men engaged in dredger operations are as a rule much older than those engaged in lode mining, at the present time.
It is estimated that the total number of men put out of employment by the order of the War Production Board will be approximately 3,270. The record before the Board establishes that of this number about 900 are miners and muckers.
From this number, it is estimated that between 150 and 200 miners and muckers would be necessary to retain the gold mines and dredges in a stand-by condition j hence, not to exceed 750 men, accustomed to actual mining and generally termed “miners” and “muckers” would be available for employment in mines of copper, lead or zinc.
The record made before the War Production Board discloses that miners, who have been for a long time engaged in gold mining, do not go into the mining of other minerals, such as copper, lead and zinc. There are many reasons stated for this custom.
It is emphatically stated before the War Production Board that if this mine labor population is released from employment in the gold mines in the respective states, only a negligible number, if any at all, will seek employment or remain employed in mining operations of other metals.
The impairment of the morale of communities in the states affected by the order of the War Production Board; the far-reaching effect upon the economic structure of the communities;.the irreparable destruction of private property that will be accomplished by the flooding and caving of gold mines; the discouragement and heartache that will come into thousands of homes, many of them the homes of boys now in the military service of this country, but whose parents and relatives remain in the communities affected by this order — all of these things will not be compensated by the negligible number, if any, of mine laborers who will go from the closed mines to communities far remote to engage in other mining activities.
*101 We respectfully draw your attention to the fact that at this very time Great Britain is urging and aiding the groduction of more gold by the gold mining operators of outh Africa.
We respectfully draw your attention to the fact that our neighbor ally in this war, the Dominion of Canada, is going forward and encouraging the production of gold in that country, and in a telephonic communication within the past few days with those in authority on the subject in Canada, the information was received that the Canadian government has no intention of closing down its gold mine operations.
We respectfully urge that no beneficial result inuring to the defense of the United States in its time of war will flow from the order made by the War Production Board closing the gold mines of this country. The record needs no emphasis that great and irreparable injury will result.
We respectfully bring this matter to your attention with the request that you stay the order made by the War Production Board affecting the gold mine operations of the United States, at least until the whole subject of marshalling of manpower and the allocation of labor may be considered, and the vital questions involved, concluded; thus that the gold mining industry of the United States may not be subjected to unwarranted and unusual hardship and injury which may not eventually be considered necessary, and which may not be equitably borne by other industries.
In May 1944, the Policy Analysis and Becords Branch of the WPB submitted a report concerning Limitation Order L-208 providing in part as follows:
It is generally agreed by the WPB divisions concerned with mining activities that a very small percentage of the released gold mine workers actually were employed by other mines. A majority of them probably went into work of greater value to the war effort than gold mining, such as lumbering, agriculture, construction, shipbuilding, aircraft manufacture;96 but the fact remains that the primary justification for closing the gold mines was to get labor for the production of*102 the strategic metals. Wilbur Nelson, Arthur S. Knoizen, present Director of the Mining Division, and F. H. Hayes, Chief of the Primary Production Branch of the Copper Division, concur in the statement that the number of gold mine workers who went into other mines and remained there for a year or more was not over 100.97
BINDINGS RELATING TO PLAINTIFF HOMESTAKE MINING COMPANY
53. Homestake Mining Company (hereinafter referred to as Homestake) is and was at all times herein mentioned a corporation organized and existing under the laws of the State of California.
54. Homestake is and was at all times herein mentioned the owner of patented mining claims covering more than 5,000 acres of mining properties containing gold-bearing ores of great value located in the Black Hills area of South Dakota, near the city of Lead, South Dakota.
55. On October 8, 1942, and for 65 years prior thereto, Homestake was and had been engaged in the business of mining, processing and selling gold, and in 1942 was the largest gold producer in the United States.
56. On October 15,1942, Homestake notified its employees of the issuance of Order L-208 and informed them of the necessity of concluding its gold-mining operations pursuant to the order. Homestake urged such employees as would be released to consider the opportunities for employment in the copper mines.
57. Pursuant to the terms of Order L-208 Homestake discontinued breaking new ore on October 15,1942, and began to lay off miners on that date.
58. On or about October 17, 1942, Homestake appealed to WPB, requesting permission to continue mining operations on the ground that Order L-208 would work an exceptional and unreasonable hardship upon it. On November 25,1942, WPB decided the appeal, granting Homestake only limited relief. The WPB advised Homestake of this decision in a letter dated November 25, 1942, which stated in part as follows:
*103 Permission granted to remove and mill broken ore from underground and refill the stopes with suitable material during a period of six months beginning December 8,1942, provided that no more than 60 employees are at any time assigned to or used in such operations and provided further that workers shall not be assigned to such operations when the War Manpower pommission finds that they are needed in mining operations elsewhere. Permission is denied to break any new ore or to proceed with any development work or any new operations in or about the Homestake mines.
59. Homestake, with the aid of the limited additional personnel authorized by WPB, continued the hoisting and processing of ore already broken from on or about October 15, 1942, until the latter part of May 1943. After June 1, 1943, the Homestake gold mine was closed down for all purposes, except necessary maintenance, until on or about July 1, 1945. It reopened on that date and has operated continuously since then.
60. On October 8, 1942, the life of operations of Home-stake’s gold mine based on ore bodies, indicated by reserves of ore in sight and ore that could be expected from development, was at least 20 years at the then current rate of mining.
61. Homestake, at the time of its founding in 1877, was located in an isolated part of the United States and as a result was required to maintain a policy of self-sufficiency. From its early days it established a program of maintaining larger inventories than customary in most mining enterprises. Prior to October 8, 1942, Homestake had acquired extensive timberlands which provided lumber for the mine, and continued this program up to the time of the issuance of Order L-208. Prior to October 8, 1942, Home-stake also had developed a coal mine, and was producing its own electric power.
62. In October of 1942, Homestake had recently completed two deep mine shafts equipped with large modern hoists, and had erected a new lumber mill. Its steam power plant was relatively new and its ore processing mills were in excellent operating condition.
63. On October 8, 1942, Homestake maintained its own foundry and machine shops used in the fabrication and repair of a variety of mining and processing equipment. In
64. The chief items of materials and supplies used by Homestake in its mining and milling operations consisted of pipe, rail, rock drills, parts for rock drills, drill steel hoisting ropes (wire), electrical wire, cyanide, lime, shoes and dies for stamp mills, balls and rods for grinding mills, liners for grinding mills, and cones and mantles for crusher's. Items of necessary equipment included locomotives, mine cars and mechanical shovels.
Homestake’s inventory of these and other necessary materials and supplies was sufficient to operate its mine during the entire period of the closure. This did not include items such as dynamite and explosives. Only a three months’ supply of dynamite was on hand on October 8,1942, but it was readily available without restriction.
65. At no time did WPB requisition or order Homestake to surrender or transfer any of its supplies, equipment or machinery, nor did it make any inquiries regarding the amount, nature or availability of Homestake’s supplies, equipment and machinery, although the Board was furnished with an inventory of supplies on hand and other information relating to equipment and machinery.
66. The working conditions at Homestake and the living conditions in the communities surrounding Homestake in 1942 were superior to those at the nonferrous metal mines to which the Government sought to transfer the Homestake miners. Homestake employees enjoyed free medical and hospital services, group insurance, pensions, recreational facilities, and many of the older miners owned their own homes. In 1942, approximately 440 of Homestake’s employees had seen more than 21 years of service with the mine, and some had been employed there for more than 40 years. For these reasons, Homestake had enjoyed greater employment stability than the nonferrous metal mines despite the lure of higher'pay in the war industries.
67. In October 1942, Homestake had sufficient labor available to operate at full capacity. Even in the event of reduction of available manpower Homestake could have maintained normal production levels by using mining techniques
68. The Homestake Mining Company released 437 men from its employment during the period from the issuance of L-208 on October 8,1942, to a date shortly prior to November 12, 1942. Of these 437 employees, 391 came from the mine department, 21 from the metallurgical department, 21 from the mechanical department, and 4 from the carpenter department. Of the 391 employees from the mine department, 183 were classified as miners on Homestake’s payroll* And of these 183 miners, 39 had less than six months’ experience. Of the 437 released, 110 men did not register with the United States Employment Service. Of the remainder, 207 of them were placed by the United States Employment Service in other mining work as of a date shortly prior to November 12,1942.
Homestake reported to the U. S. Social Security Agency that it had in its employ during the third quarter of 1942 a total of 2,129 employees. In its report for the fourth quarter of 1942, the company reported that 921 of these employees received less wages than they had received in the preceding quarter, which indicates that these employees were separated from the company’s employ before December 31, 1942. Of these 921, there were 401 also reported by another employer, although not previously so reported, which indicates that these employees transferred to such other employers after leaving the Homestake Mining Company. These figures did not include transfers after December 31, 1942, although Homestake continued limited operations through that date.
69. In October 1942, Homestake was the largest single source of potential nonferrous metal mining labor. Representatives of the United States Employment Service, immediately following the issuance of L-208, attempted to induce released workers to accept employment at the Anaconda copper mine at Butte, Montana, and the Climax Molybdenum mine at Climax, Colorado, both about 500 miles from the Homestake mine.
Fifty-one Homestake employees accepted employment at Climax. Forty-one stayed less than six months and only six employees remained as long as one year.
70. The properties of Homestake were useful for no other purpose than the production of gold and were adaptable to no other use than the conduct of a gold mining business.
71. The closing of the Homestake mine pursuant to Order L-208 had far-reaching and drastic repercussions in the city of Lead and the surrounding communities. The population declined sharply, more than 750 homes and apartments were left vacant and boarded up, and 36 business establishments which had served the communities were left vacant.
72. In the years immediately prior to the issuance of Order L-208, the State of South Dakota received about $1,000,000 per year, or approximately ten per cent of its annual revenues, from Homestake. The State was deprived of this source of revenue by the order closing the gold mines.
73. Without acquiring new machinery or repair parts, or supplies on which there were restrictions concerning acquisition, and with a reduced labor force, Homestake could have operated profitably during the period of closure.
74. By reason of the issuance of Order L-208 Homestake was deprived of the use and benefit of ownership of its gold-mining properties, to wit, the right to obtain gold from the ore bodies on its properties and to sell such gold.
75. No compensation has been paid to plaintiff Homestake by defendant for the closing of its mine as hereinbefore described.
FINDINGS RELATING TO PLAINTIFF CENTRAL EUREKA MINING COMPANY (A CORPORATION)
76. Central Eureka Mining Company (hereinafter referred to as Central Eureka) is a corporation organized and existing under the laws of the State of California, with its principal places of business located in Sutter Creek,
77. On October 8, 1942, Central Eureka owned approximately 641 acres of gold-bearing land located at Sutter Creek, Amador County, California. On that date the mine employed a total of 117 men, of whom 73 were classified as underground workers.
The average age of the total number of employees was 41.74 years; 74.36% of the employees were married and had an average of 2.64 dependents. These employees had resided in the community wherein the mine was located for an average of 4.26 years, and 31 of these employees owned their own homes in that community.
78. Immediately following the issuance of L-208 on October, 8, 1942, all but 64 men left the mine, that group having been retained by the company to maintain the mine until January 1943, when the National War Labor Board ordered that thereafter the company would not be authorized to employ more than 42 men in the maintenance of the mine. The record does not disclose how many of either the 64 or the 42 men were underground workers.
79. Prior to October 8,1942, Central Eureka Mining Company was engaged in the successful operation and development of its gold mining property at a profit. In the five-year period immediately preceding the issuance of L-208, the company paid $355,414.04 in Federal and State taxes. During that same period of time the company paid to its shareholders dividends in the amount of $1,182,000.
80. On October 8,1942, Central Eureka had an inventory of supplies on hand which would have enabled the mine to operate for a period of two or three years without replenishment.
81. Central Eureka’s mining equipment included on October 8,1942, machine shops, electrical shops, blacksmith shop, carpenter shop, an assay office, a complete mill from primary crush to cyanidation, its own source of timber, automotive and all other necessary equipment required to carry out mining and servicing of the underground workings and the extraction of gold from ore bodies.
83. The properties of Central Eureka Mining Company were useful for no other purpose except the production of gold, and were adaptable to no use other than the conduct of a gold mining business. The mine was closed by reason of compliance with L-208.
84. Within six weeks after the issuance of Order L-208, Central Eureka applied for a serial number under P-58 for the operation of a copper-mining project at Battle Mountain, Nevada. Some mining equipment was transferred from its gold mine to this copper project. It was closed down by Central Eureka about the middle of 1943.
85. In addition, Central Eureka leased some mining equipment, including flotation machines and feeders, agitators, classifiers, sand pumps, filters and compressors, to individuals who were engaged in tungsten mining. This material would not have been so leased had it not been for the- issuance of Order L-208.
86. On December 9, 1943, Central Eureka, by its general superintendent, wrote the following letter to the Mining Division of WPB:
As General Superintendent of the Central Eureka Mining Company, an Amador County, California gold Eroducer closed under War Production Board Order [ — 208 and placed on a maintenance basis, I wish to call your attention to our position as well as similar gold operations.
■ ■ The cost of keeping our mine unwatered and of doing absolutely essential retimbering and repair work is becoming a great burden on this Company’s treasury. If it became necessary to abandon the mine entirely and allow it to fill with water, I question seriously whether we or anyone else would be able to undertake a rehabilitation project at the present price of gold.
*109 It appears to me that the situation could be helped very much if we could have the sympathetic consideration of the people charged with the administration of Order L-208 in a relatively small departure from the provisions of the Order. Such departures might include (1) the hiring temporarily or permanently of a few additional men, either as replacements or to meet emergencies, (2) the permission to extract a small amount of ore to help out the heavy deficit of the maintenance operation and to allow variations from time to time in the tonnage extracted, and (3) the consideration of use or exchange of a small amount of strategic materials as required. So far, we have been unable to make Washington officials understand these operating problems. I do not believe that such misunderstanding is the result of being arbitrary but is probably due to the fact that they are too far away from our operations to see the true picture. My thought is that if the administration of Order L-208 could be decentralized and placed in the hands of some Western representative — either Mr. Lane in Denver or Mr. Keating in San Francisco — our operations would receive a more sympathetic consideration based upon a personal understanding by the Administrator. I feel personally that this could be done without interfering in any material way with the purposes of Order L-208, understanding of course that the purpose of Order L-208 is the conservation of manpower and strategic materials for the war effort.
It is of vital concern to this Company and to this community to keep our operation alive if at all possible. The lack of authority given local administrators with respect to Order L-208 seems to unfairly discriminate against the gold mining industry as compared to other forms of business which have been forced to indirectly reduce operations. A local administrator with adequate authority could help materially to clear up this feeling on the part of the gold operators and of the citizens of the gold mining communities.
Your early consideration of this request would be greatly appreciated.
87. On December 17, the WPB acknowledged and on December 22, 1943, replied to the above letter in part as follows:
Supplementing our letter of December 17, your problem has been discussed very thoroughly in conference, and we fully understand your problems on maintenance in keeping your mine open and ready for operation.
*110 We suggest that you file an appeal from this order, stating your problems in detail, advising what is involved in getting your mine in operation and maintaining it on a minimum basis. In your appeal, also state whether manpower is available, and if so, can you get certification from the War Manpower Commission to use these men if they are not needed in other essential war industries.
We assure you that as soon as this appeal is filed, we will give it immediate consideration to see what can be done to give you some relief under the order.
We also suggest that you file with your appeal, the possible requirements of material of all types that you will need for approximately a year. If this is not possible, six months will suffice.
* * * * *
There is no evidence of an appeal under L-208 other than the letter quoted in finding 86.
88. By reason of the issuance of Order L-208, Central Eureka was deprived of the use and benefit of ownership of its gold mining properties, i. e., the right to obtain gold from the ore bodies on its properties and to sell such gold.
89. No compensation has been paid to Central Eureka by defendant for the closing of its mine as hereinbefore described.
90. On June 30, 1945, the WPB revoked Order L-208. Thereafter in 1947 or 1948 Central Eureka reopened its mine and has operated it continuously since.
FINDINGS RELATING TO PLAINTIFF IDAHO MARYLAND MINES CORPORATION
91. Idaho Maryland is now and was on October 8, 1942, and at all times hereinafter mentioned has been, a corporation duly organized and existing under the laws of the State of Nevada.
92. Idaho Maryland is now and at all times herein mentioned has been the owner in fee of certain gold-mining properties known as the Idaho Maryland Mines, consisting of approximately 8,000 acres of gold-bearing lands situated in the Grass Valley Mining District in the County of Nevada, State of California, together with all necessary mining plant and equipment located on said lands.
94. Idaho Maryland’s mining equipment located on said lands included on October 8, 1942, machine shops, electric shops, welding shops, blacksmith shop, carpenter shop, cy-anidation plant and smelting plant, a sawmill and other mills, shops, automotive and all other necessary equipment required to carry out mining and servicing of the underground workings and the extraction of gold from the ore bodies.
95. It would not have been necessary for Idaho Maryland to acquire, during the life of Lt-208, any critical materials, supplies, equipment or facilities to enable it to continue operation on a profitable basis, because, (1) the mine was a fully developed mine comprising extended drifts, cross-cuts, raises and winzes, fully equipped with a large amount of modern mechanical equipment, including an efficient hoisting layout; (2) the company owned sufficient equipment in good condition, a large inventory of supplies and materials necessary for operating the mine, including large quantities of pipe and rail, steel, drill steel, building machine repair parts, tires, tubes, repair parts for milling machinery, valves, pipe fittings and miscellaneous supplies, a large supply of mercury and all other materials required to operate the mine. At no time during the war were industrial or commercial explosives, including dynamite, fuses and caps, subject to priority restrictions, and were available in large supply in the open market.
96. During the period of close down, Idaho Maryland was not wholly dependent upon the use of the mining machinery and equipment actually owned by it on October 8, 1942. There was a considerable quantity of secondhand mining machinery available at all times in California which could have been purchased by Idaho Maryland had the necessity arisen. Secondhand mining machinery was not rationed and was freely obtainable in the open market.
98. Idaho Maryland operated its own saw mill and had its own supply of timber. The mine obtained its power in 1942 from the Pacific Gas and Electric Company and continued to use such power throughout the period of shutdown. There was no shortage of electric power at the mine nor was it curtailed or restricted during the shut down but was available at all times.
99. The operations at Idaho Maryland were curtailed due to the loss of manpower between December 1941 and October 8,1942. The payroll was reduced from over 800 employees to 212 employees between those dates. As the separations of employees reduced the number of employees, it became necessary before the closedown ordered by L-208 to alter their mining methods so as to more effectively utilize the employees who had stayed.
100. On October 8,1942,116 of Idaho Maryland’s remaining employees were underground workers. The average age of all employees as of October 8,1942, was 47.7 years and 43 of the underground men were over the age of 50. If all of Idaho Maryland’s underground workings had been kept safe and accessible as permitted by L-208, none of the 116 underground workers would have been released.
101. During the period of October 8,1942, to June 30,1945, while Order L-208 was ineffect, Idaho Maryland could have
102. Upon the issuance of Limitation Order L-208 on October 8,1942, Idaho Maryland, under threat of criminal prosecution for failure to comply therewith, immediately notified its employees that the mine was being closed down and discontinuing work. In compliance with said order Idaho Maryland completely closed down the operation of its gold-mining properties and suspended all mining production from and after the period prescribed in said Order L-208, to wit, on October 15,1942.
103. The properties of Idaho Maryland are, and were, useful for no other purpose except the production of gold, and said mining properties were adaptable to no profitable use other than the conduct of a gold-mining business and were not capable of being used for any purpose other than the production of gold.
The blacksmith shop, machine shops and other shops and equipment of Idaho Maryland, which were used for the repair and maintenance of mining machinery, were not capable of being utilized in the mass production of any item and were not devoted to any other use during the period of shutdown following the issuance of L-208.
104. With a greatly reduced labor force and without acquiring any critical material, supplies, equipment or facilities subject to government control, Idaho Maryland could have operated its mining properties on a profitable basis during the period L-208 was in effect.
106. Grass Valley, Nevada County, California, located near Idaho Maryland’s gold mining properties, was wholly dependent upon the operation of the gold mine for its continued prosperity. The closing of the mine caused considerable community dislocation and individual hardship. Since 1848, the principal occupation of the inhabitants of the communities of Grass Valley and Nevada City had been gold mining.
107. Pursuant to an appeal taken by Idaho Maryland Mine to the War Production Board, the mine was permitted to complete a second exit between the mine and the Brunswick Mine which was required by California State Law. On December 18,1943, Idaho Maryland filed a second appeal calling to the attention of the Board specific conditions which existed underground in the mining properties by reason of the shutdown. The underground workings were caving and collapsing and the mine contended that it was essential for the protection of the underground workings that mining operations be resumed forthwith. On May 3, 1944, Idaho Maryland was permitted by WPB to resume operations on a limited basis with not over 200 men who must be over 40 years of age and not working for other industries. Production permitted was limited to 7,800 tons of ore per month but Idaho Maryland was not able in 1944 to reach that production because of the time it took to prepare for production and to open up the necessary ground workings due to the destruction which had already occurred to the mine. A third appeal
108. By reason of the issuance of Order L-208, Idaho Maryland Mine was deprived of the use and benefit of ownership of its gold mining properties, i. e., the right to obtain gold from the ore bodies on its properties and to sell such gold.
No compensation has been paid to Idaho Maryland by defendant for the closing of its mine as hereinabove described.
FINDINGS RELATING TO PLAINTIFF ORO FINO CONSOLIDATED MINES, INC.
109. The petition as to this plaintiff was originally filed on February 8, 1950, in the name of Oro Fino Consolidated Mines, Inc. Thereafter on September 9, 1952, an amended petition in this case was filed in the name of Oro Fino Consolidated Mines, Inc.
110. Oro Fino Consolidated Mines, Inc., was incorporated under the laws of the State of Nevada on January 4, 1950.
111. Under date of September 5, 1935, Hazel P. Gridley leased to one J. C. KempvanEe certain gold mining property in Ophir Mining District, Placer County, California, known and described in the lease as the Ora Fina Mine. J. C. KempvanEe'thereafter operated this property as Oro Fino Consolidated Mines, but this was simply a trade name, and the lessee continued to be the said KempvanEe.
112. Mr. KempvanEe was operating said gold-mining properties on October 8, 1942. On November 16, 1942, he requested permission of the War Production Board to continue the removal and milling of broken ore until January 15, 1943, representing that there were then 1,912 tons of broken ore in the mine. Such permission was granted by the War Production Board under date of December 2,1942. The record does not disclose when operations at the mine actually ceased, but it was apparently prior to March 27, 1943. The mine has never operated since that date.
113. As of October 8, 1942, there were approximately II employees in the mine as contrasted with about 40 in “normal” times. The record does not disclose the employments
114. There is no evidence in the record as to the amount of machinery or equipment in the mine as of October 8, 1942, or as to the availability of materials for the maintenance of such machinery or equipment. The mill had been newly erected in 1938, and there were certain parts available for its maintenance, although it does not appear how long the mill could have continued operating without replenishment of this inventory of parts. The record does not indicate the disposition, if any, which was made of these parts and equipment following the closing of the mine.
115. The properties of Oro Fino were useful for no other purpose than the production of gold and were adaptable to no other use than the conduct of a gold mining business.
116. By reason of the issuance of L-208, Mr. KempvanEe was deprived of the use and benefit of the gold mining properties leased by him, i. e., the right to mine and sell gold.
117. In 1948 a Mr. MacBoyle, Mr. KempvanEe’s financial backer, died. Mr. KempvanEe then turned to Mr. Nugent for financial assistance as there were certain royalty payments under a lease and certain other expenses recurring. Mr. Nugent agreed to furnish such assistance and did so. He suggested that the operation be incorporated. On January 4, 1950, Oro Fino Consolidated Mines, Inc., was organized. On February 2, 1950, Mr. KempvanEe assigned all his right, title and interest in the lease of the mining property from Mrs. Gridley to Oro Fino Consolidated Mines, Inc.
The assignment provides in part as follows:
The undersigned J. C. KempvanEe does hereby sell, assign, transfer and grant unto Oro FiNO CoNsolidated MiNes, Inc., a corporation, all right, title and interest in and to that certain mining agreement and the real property therein described and all rights arising by virtue of said agreement, dated September 5,1935, by and between Hazel P. Gridley, a widow, designated at lessor and J. C. KempvanEe, designated as lessee, * * *
Said agreement is hereby incorporated herein and made part hereof for all purposes as though fully set forth herein.
FINDINGS RELATING TO PLAINTIFF ALASKA-PACIFIC CONSOLIDATED MINING COMPANY
119. Alaska-Pacific Consolidated Mining Company (hereinafter referred to as Alaska-Pacific) has been since prior to October 8,1942, and still is a corporation organized and existing under the laws of the State of Washington. Alaska-Pacific is the successor in interest by way of merger of two predecessor corporations and has been, since 1988, the sole operator of the mining properties referred to hereinafter.
120. Alaska-Pacific is the owner and operator of certain mining properties located in the Willow Creek (Wasilla) Mining District in the Territory of Alaska. With the exception of two groups of mining claims hereinafter noted, all of Alaska-Pacific’s properties on October 8, 1942, and thereafter were held in fee or by location notices which later matured into patents in fee issued to Alaska-Pacific by the defendant. As to one of the excepted groups, that known as the “Alaska Free Gold” claims, bearing General Land Office Survey No. 980, Alaska-Pacific held the mining rights on October 8, 1942, and has continued to hold them since then, by virtue of a lease and royalty agreement, coupled with a purchase option, which does not expire until 1961. The other excepted group, namely, the Hamburger, Eed Eye and Weeny claims, were held by Alaska-Pacific on October 8,1942, and are still so held by virtue of location notices.
121. On the aforesaid properties, Alaska-Pacific, since 1938, and its predecessors before them, operated an underground or lode mine, consisting of about 5 miles of underground workings with two entries.
122. Geographically, Alaska-Pacific’s mine is located about 20 miles from W asilla and 28 miles from Palmer, in an isolated section of the Wasilla precinct, there being no other inhabitants except a few miners employed in neighboring mines. Except for timber which was purchased locally, all supplies, including foodstuffs, were imported from the States. These supplies moved by ship to the port of Seward, thence
123. Because of its isolated location, a company village was maintained at the mine, consisting of the mine and mill buildings, various warehouses, shops, dormitories, a school and an office building, a store, a messhall and various recreation facilities. All buildings were of frame construction and were serviced with central underground water and sewage systems. Because of severe winter conditions with snows ranging to 25 feet in depth and temperatures ranging to minus 50 degrees, and because of heavy rains in other periods of the year, constant maintenance and attention to surface installations were required to prevent early deterioration and serious damage from the elements.'
124. Normally, Alaska-Pacific operated its mine with a crew of about 125 men. In October of 1942 it had a mining crew in its employ of 101 men. Of these, only three had experience in mining other than gold mining, that being in the employ of either of the two coal mines then operated in Alaska.
Aside from the two coal mines, there were no other types of mines in Alaska except gold mines.
125. Alaska-Pacific not only produced gold from its mine but also, as a kind of byproduct, a type of concentrate essential to the smelting of copper. Alaska-Pacific’s concentrates were shipped to the Tacoma Smelter, Washington, and furnished about 10 percent of its requirements.
126. Under date of October 15, 1942, Alaska-Pacific submitted an appeal to the WPB for relief from the provisions of Order L-208. This appeal emphasized:
*119 First: The position of the company as a tungsten producer, actually and potentially.
Second: The position of this company as the supplier of valuable and necessary materials to the copper smelting operations of A. S. & R.’s Tacoma Smelter.
‡ ‡ ‡ 4
It also referred to the hardship upon the company and its employees of closing the mine, and requested:
* * * :¡: *
In the light of these showings, and particularly in view of the progress made by this company in the production of a strategic metal, we again request the Board to restore the P-56 rating which had been revoked by the general order of March 2nd last. If the said rating is granted, the company will agree to curtail its gold production by at least 50% by ceasing development of sections of its mine where no deposits of scheelite in recoverable quantities exist.
* % # *
The WPB granted this appeal, by telegram reading as follows:
RE YOUR APPEAL PROM ORDER L-208 YOU ARE HEREBY AUTHORIZED TO CONTINUE OPERATIONS UNTIL DECEMBER 8TH, AT YOUR INDEPENDENCE MINE UNDER THE POLLOWING CONDITIONS : DURING THAT PERIOD YOU WILL DRILL, BREAK AND DEVELOP, AS RAPIDLY AS POSSIBLE, THE SCHEELITE ORE SHUTE YOU HAVE OPENED, IN ORDER TO SHOW THE MONTHLY TONNAGE OP SCHEELITE WHICH YOU CAN MINE, TREAT AND SHIP TO THE METALS RESERVE COMPANY’S STOCKPILE AT ANCHORAGE (STOP) YOU ARE, UNDER THE TERMS OP THE ORDER, PERMITTED TO REMOVE PROM THE MINE ANY OTHER ORE BROKEN AND IN THE MINE AS OP OCTOBER 15TH, AND MILL THE SAME (STOP) YOU ARE AT THE SAME TIME REQUIRED TO PREPARE THAT PART OP YOUR MINE NOT CARRYING [tIiie SCHEELITE ORE TO BE IN STAND BY CONDITION BY DECEMBER 8TH (STOP) ON OR BEPORE NOVEMBER 30, YOU MUST PURNISH A COMPLETE PROGRESS REPORT TO US ON YOUR TUNGSTEN DEVELOPMENT AND ALSO ON THE AMOUNT OP BROKEN ORE YOU HAVE REMOVED PROM YOUR MINE AND MILLED, WITH METALLIC CONTENT (STOP)
127. Under date of November 27,1942, Alaska-Pacific submitted to the WPB a report on its scheelite (tungsten) production, as requested in the grant of the appeal. This report pointed out that approximately 2,000 tons of ore had
* * * By no stretch of the imagination is scheelite likely to become anything more than an important byproduct of our gold operation. Actual financial loss will attend the scheelite phase of our operations, and such losses are likely to persist for the entire period during which scheelite is produced, unless subsidies are granted, or scheelite prices raised. * * *
* * * * *
The scheelite situation at Independence is in the same category. Frankly, it is a case of no gold, no scheelite. We cannot waste the economic metal in order to produce the uneconomic one. This company would be hard put to maintain its predominantly gold workings in standby condition and at the same time undertake production of scheelite at a loss, unless income from its gold production was continued.
We submit this letter and the accompanying Progress Report with confidence that the evidence offered will justify the issuance to us, at an early date, of a priority rating which will affectively [sic] suspend L-208 as it may apply to our operation at Independence. In the event that your Board should determine upon action according further time extension in the application of the order, we wish to suggest that not less than six months be accorded us, as any shorter time would be inadequate to bring our scheelite potentialities into production upon an efficient basis. The extension should permit continued normal gold production, so that the hardships referred to in our Appeal of October 15th would not materialize, and so that scheelite production, carried on at a loss, would be reasonably compensated for.
Under date of December 11, 1942, the WPB granted Alaska-Pacific an additional period of operation, its letter of authorization reading in material part as follows:
After careful consideration of the facts presented in your Appeal, the following relief from Order L-208 is hereby authorized:
Permission is granted until June 8, 1943, to continue your normal lode mine operations of breaking, drawing and milling gold-bearing ore, for the pur*121 pose of producing tungsten-bearing ore and upon the condition that plans for proceeding with this operation shall meet with the approval of the War Production Board.
The provisions of Order D-208 are waived to the extent required to obtain the relief authorized above, provided that Order L-208 in all other respects and all other Orders and Regulations of the War Production Board are fully complied with.
128. Alaska-Pacific submitted certain additional reports and requests for relief in the succeeding months. In a report submitted under date of January 26,1943, it stated that approximately 35 tons of scheelite ore had been produced in two full months, which “exceeded the 3% minimum of contained WO-3 prescribed by Metals Reserve Company.”
129. Under date of April 14, 1943, the Director of the Mining Equipment Division of WPB wrote to Alaska-Pacific in part as follows:
* * * Your report on the recovery and production of tungsten, and the information contained in the report by the United States Geological Survey, would indicate that it is neither desired or advisable, to attempt to continue your operations on any other basis than for the production of gold with tungsten as a by-product. The limited amount of tungsten that might be produced by hand-sorting of the ore is not impressive. Additional tungsten might be recovered by proper mill treatment of the ore, but the time involved in determining the method of recovery to be used in making installations in your plant, the manpower required in the operation of your mine and mill, the materials consumed, and the potential tungsten production, do not justify the continuation of your project.
It is the opinion of all groups concerned, after a thorough review of your case, that neither your present production of tungsten or potential production under either of the proposed plans for recovery, justifies the continued operation of your gold mine.
The production of a high iron sulphur concentrate as diluent, for use at the Tacoma Smelter, through the mining and treating of an estimated 30,000 tons of ore annually, to produce 1,000 tons of concentrates, is not economical in the use of manpower or materials consumed. Every possible effort is being made to provide that type of flux from other than a gold mine. For these reasons, the issuance of a serial number under*122 Order P-56 for your gold mine, has not been recommended.
The grant permitting continuation of your gold mining operations at the Independence Mine, Wasilla, Alaska, expires June 8, 1943. You are hereby advised that your mine and mill should be placed in standby condition by that date. This is in accordance with the policy of the War Production Board, established through the issuance of Limitation Order L-208, directing the closing of all nonessential mines in the United States. This policy has been extended to Latin America and other foreign countries, through the curtailment of supplies and materials being furnished for gold mining. The reduced consumption of materials, supplies and equipment, through the cessation of gold mining, transfer of idle equipment for use in production of strategic materials and defense projects, has been effective in stimulating production, accelerating completion of projects and reducing the load on the production lines, which are needed to produce for direct military requirements, as well as our vital industries.
130. Under date of May 12,1943, Alaska-Pacific submitted to WPB a final and voluminous appeal, emphasizing the hardship to itself and its employees which would result from the close down of operations.
By telegram of June 6, 1943, the WPB allowed a further extension of operations to August 8,1943. On June 21,1943, the administrator of Order L-208 wrote to Alaska-Pacific advising that after August 8, 1943, the mine must be placed in standby condition.
131. On July 29, 1943, Alaska-Pacific sent the following letter to the WPB Mining Branch:
This is to advise you and the various members of the Board that on or before August 8th, 1943, our operations near Wasilla, Alaska, will be closed down pursuant to the above referred to Order and the various directions issued thereunder. This step is taken by us under the threat of the criminal and other penalties which are provided for in the order. It is not voluntary on our part, but under express protest.
We hereby advise you of such protest and that we reserve all of our legal rights against those responsible for the promulgation and enforcement of this order, it being the position of this company that the order itself and*123 the various actions taken under it are without sufficient foundation in law and are illegal.
We are unable at this time to estimate the extent of the damage which we may sustain by virtue of the enforcement of this order. However, you are advised that it will amount to a substantial sum.
On August 13, 1943, the administrator of Order L-208 wrote the following letter to Alaska-Pacific:
Your letter of July 29 with reference to the closing of your Independence Mine at Wasilla, Alaska, has just been brought to my attention.
We regret that conditions necessitated the action which made the closing of your mine necessary, however, we feel that you are following the wisest course by ceasing operations at the expiration of the extension of the grant made to your company. Little hope of extension could be anticipated in view of present conditions in Alaska, with respect to coal shortage and the difficulty in securing men to work in those mines.
We trust that your company will encourage in every way possible the transfer of men released from your operations, to coal mines. That is one of the most important contributions that could be made to the war effort at this time.
132. The plaintiff received a formal notice dated August 13,1943, from the WPB in the following terms:
This is with reference to your appeal filed under date of May 12, 1943, requesting relief from the provisions of Limitation Order L-208.
An extension of time was given you on the grant under which you had been operating, permitting you to continue your operations until August 8, 1943, under the same limitations and prohibitions as the original grant.
You ask that an exception be made in your case by the grant of permission to continue your lode mine operations in the Independence Mine located at Wasilla, Alaska, for the purpose of extracting gold in conjunction with your tungsten ore production.
The Appeals Board has given full and careful consideration to all of the facts brought out in your appeal and has consulted the War Manpower Commission as to the advisability of permitting your workers to continue in a non-essential mine. It is the War Manpower Commission’s belief that your workers can be utilized to better advantage in the war effort in the coal mining operations in your immediate vicinity.
*124 Therefore, we regret to inform you that your appeal for relief from Order L-208 must be denied.
133. There is no competent evidence in the record to show the employments to which former employees of Alaska-Pacific transferred upon the closing of the mine on August 8,1943. On the whole, gold miners are unfavorably inclined toward employment in coal mines, partly because of the hazards involved and partly because equipment and machinery are different. Although the record does not establish the exact number of gold miners who transferred to the two coal, mines, at least four, and possibly a few others, did. There were no other strategic metal mines in Alaska for the gold miners to transfer to.
134. Subsequent to the closure of the mine, Alaska-Pacific sold most of the perishable items in its inventory to such agencies as the Alaska Koad Commission and the Alaska Eailroad, and stored at the mine the other items.
135. Prior to the closure pursuant to L-208, Alaska-Pacific was operating its mining properties at a profit.
136. By reason of the issuance of L-208 Alaska-Pacific was deprived of the use and benefit of ownership of its gold mining properties, i. e., the right to obtain gold from the ore bodies on its properties and to sell such gold.
137. No compensation has been paid to Alaska-Pacific by defendant for the closing of its mines as hereinbefore described.
FINDINGS RELATING TO PLAINTIFF BALD MOUNTAIN MINING COMPANY
138. Bald Mountain Mining Company (hereinafter referred to as Bald Mountain) is a corporation incorporated under the laws of the State of South Dakota.
139. On October 8,1942, Bald Mountain was the owner of certain gold-bearing lands in Lawrence County, South Dakota. On that date it was engaged in mining gold on said properties.
140. Subsequent to the issuance of Limitation Order L-208 by the War Production Board, Bald Mountain filed an appeal for relief from its provisions, and was granted permission to remove broken ore from the mine and to operate
141. Bald Mountain had approximately 150 employees shortly before October 8, 1942. The record does not disclose the nature of the employments to which these men shifted after the closing of the mine.
142. The record does not disclose the nature or size of Bald Mountain’s inventory of mining equipment, materials and supplies as of October 8,1942, or the length of time it could have continued to operate without replenishment of such inventory. The record does not disclose the extent, if any, to which this plaintiff may have sold or otherwise disposed of any of its mining equipment during the period its mine was shut down.
143. Bald Mountain reopened its mine shortly after the revocation on June 30, 1945 of Limitation Order L-208, and has remained in operation since.
144. By reason of the issuance of L-208 Bald Mountain' was deprived of the use and benefit of its ownership of its gold mining properties, i. e., the right to obtain gold from the ore bodies on its properties and to sell such gold.
145. No compensation has been paid to Bald Mountain by defendant for the closing of its mine as hereinbefore described.
EINDINGS RELATING TO PLAINTIEE ALABAMA-CALIFORNIA GOLD MINES COMPANY
146. Alabama-California Gold Mines Company (hereinafter referred to as Alabama-California) is a corporation organized under the laws of the State of Washington.
147. On October 8, 1942, Alabama-California was the owner of certain gold-bearing lands located in the State of California. ■ • ■'
148. On August 8, 1942, Alabama-California closed its gold mine, and ceased all operations at the mine either that day or the next. This closing was the result of a shortage of manpower and materials, and the possibility that such
149. During the year 1943, Alabama-California sold $40,000 to $50,000 worth of supplies and materials from its mine. Additional sales were made thereafter, and in 1949 most of the balance of the machinery and equipment at the mine was sold.
150. Alabama-California has never reopened its gold mine since its closing in August of 1942..
BINDINGS RELATING TO PLAINTIFF CONSOLIDATED CHOLLAR GOULD & SAVAGE MINING COMPANY
151. Consolidated Chollar Gould & Savage Mining Company (hereinafter referred to as Consolidated Chollar) is a corporation organized under the laws of the State of California.
152. On October 8,1942, Consolidated Chollar owner certain gold-bearing lands in Story County, Nevada.
153. On October 8, 1942, the above-named firm was operating a mine producing gold and silver on this property, the proportion of the two metals produced being about fifteen ounces of silver to one of gold. Its method of operation at that date was an open-pit one, that is to say, it had explored the location and size of the veins of gold and silver through an underground shaft, but finding the cost of mining through that shaft to be excessive, had stripped off the rock above the veins containing precious metal, and was recovering ore by use of power shovels. It had limited its operations exclusively to open-pit mining sometime prior to the middle of 1942 when the underground mining was discontinued.
154. Prior to the issuance of Order D-208, from about March 1942 until such issuance, it had been apparent to this plaintiff’s officers that the pit operations of stripping off the surface rock, or overburden, preliminary to mining the gold and silver ore, were becoming prohibitively curtailed because of the shortage of rubber essential to the trucking of waste from the stripping operations. For several months prior to October 30, 1942, in anticipation of that point when the development of new ore would no longer be practicable, Consolidated. Chollar’s management had been making prepara
The record does not show the extent of the open-pit operations which had been conducted by this firm.
155. On October 30,1942, Consolidated Chollar requested of the WPB permission to conduct operations which would consist of the rehandling of previously mined and processed ore called tailings. It stated that the operations would require a crew of only six men and that they would be available from the local community and were of advanced age so they were precluded from employment in copper mines or defense plants. It also stated that the planned operations would require no steel consumption and that the supplies on hand and available from mines already closed down would enable the operations to be carried to completion.
On November 25,1942, Consolidated Chollar was notified by the WPB that it was authorized to conduct the rehandling operations desired, and on February 26,1943, this authority was extended to June 30,1943.
156. Consolidated Chollar’s operations involving the re-handling of previously processed ore turned out to be unsuccessful and resulted in financial loss. On April 28, 1943, it advised WPB of this and requested permission to resume its normal operations consisting of open-pit mining. It informed the WPB that a resumption of such operations had been impossible three to six months previously because of the lack of adequate equipment but that it then anticipated equipment would be available for a resumption of normal operation as a result of the completion of defense projects in the area of its operations.
Consolidated Chollar anticipated that its return to open-pit operations would require not to exceed 20 men from the locality whose ages averaged over 50 years. This plaintiff also anticipated that steel consumption in the open-pit operations would be extremely low and estimated that there were sufficient steel-contained materials on hand to last about six months. Necessary operating supplies and fabricated repair parts were expected to amount to about $6,000 per month.
157. On June 23, 1943, in furtherance of its attempts to obtain permission to conduct open-pit operations, Consolidated Chollar advised the WPB by letter that there were 15 men not suitable for work in war industries available in the locality and that there were sufficient operating supplies and fabricated repair parts on hand, with the exception of sodium cyanide, for the conduct of operations for six months. It stated in this letter that if such operations were authorized, priority assistance for supplies and equipment would not be required for six months except in the event of unexpected equipment breakdown.
158. On August 28, 1943, the WPB issued Serial No. 36-26-T under Preference Eating Order P-56 which had the result of removing Consolidated Chollar from the restrictions of Order L-208. It was permitted to conduct open-pit operations as a result of the issuance of this serial number. Also, it was authorized by the serial number the use of a priority rating under P-56 for the obtaining of maintenance, repair, and operating supplies. The rating was extended at least through the first and second quarters of 1944.
By letter dated December 10, 1943, Consolidated Chollar reported to the WPB in respect to its operations under the serial number for the previous ninety days, as follows:
Owing to inefficiency of available labor and lack of adequate equipment in the form of power shovels and trucks for the pit operation we have as yet been unable to bring the operation up to capacity. As time goes on we hope this condition will improve.
The letter also stated that up to and including November 30, 1943, it employed 23 men and that the average daily tonnage of ore produced was 320 tons. These figures compared with the 1942 operations which resulted in a total tonnage of 144,192 tons, or roughly 400 tons per day, with about 23 or 24 employees.
159. After the war when Consolidated Chollar resumed: operations, it conducted open-pit operations. At that time this plaintiff found it necessary to first remove overburden, from above the ore vein because no ore was clear for breaking. The reason for this was that during the effective period of Order L-208, it had been able to process all of the ore which it had stripped of overburden prior to the close of 1942.
160. From the issuance of L-208 to August 28,1948, Consolidated Chollar was permitted to carry on the rehandling-of previously mined and processed ore in accordance with, plans the company had made early in 1942. From August 28,1943, to the end of the war, Consolidated was in possession of a serial number which permitted it to carry on open-pit mining operations and to use a priority rating under P-56 to, obtain maintenance, repair and operating supplies. Consolidated Chollar was never required to close its mine under L-208.
FINDINGS RELATING TO ELAINTIEE ERMONT MINES, INC.
161. Ermont Mines, Inc. (hereinafter referred to as Ermont), is a corporation organized under the laws of the State of Oregon.
162. On October 8,1942, Ermont was the owner of a compact block and contiguous Quartz Lode Mining Claim, designated Nos. 1 through 34 inclusive, located in Montana unorganized Mining District, County of Beaverhead, State of Montana.
163. In October 1942, Ermont was working claims numbered 1 (with drifts on claims numbered 2, 3 and 4), 2 (working over into claim No. 6), 7, 9, 19, 20, 23, 24, 28, and' 32. After receiving WPB order to close down in October 1942, Ermont continued' taking out the ore already mined during the latter part of October and into November, ran it through the mill and the refinery and shipped it to the mint.. Thereafter the mine and buildings were closed and a watch-man was employed to look after the property.
165. By reason of the issuance of E-208 Ermont was deprived of the use and benefit of its ownership of its gold mining properties, i. e., the right to obtain gold from the ore bodies on its properties and to sell such gold.
166. No compensation has been paid to Ermont by defendant for the closing of its mine as hereinbefore described.
CONCLUSION OP LAW
Upon the foregoing findings of fact, which are made a part of the judgments herein, the court concludes that as a matter of law plaintiffs Homestake Mining Company, No. 50195; Idaho Maryland Mines Corporation, No. 50182; Central Eureka Mining Company, No. 49468; Alaska-Pacific Consolidated Mining Company, No. 49693; Bald Mountain Mining Company, No. 50214, and Ermont Mines, Inc., No. 50214, are entitled to recover, the amounts to be determined in further proceedings under Buie 38 (c) before a commissioner of the court.
The court further concludes that as a matter of law plaintiffs Oro Fino Consolidated Mines, Inc., No. 49486; Alabama-California Gold Mines Co., No. 50214, and Consolidated Chollar Gould & Savage Mining Company, No. 50214, are not entitled to recover and their petitions are therefore dismissed.
on defendant’s motion for new trtat.
Littleton, Judge, on July 12,1956, delivered the opinion of the court:
In support of its motion for a rehearing in the above cases, the Government says that the court erred in holding that the issuance of War Production Board Limitation Order
Defendant attempts to create the impression that this court held that the War Production Board purported to act under a single act, i. e., the Act of October 16, 1941, 55 Stat. 742, containing certain requisitioning powers, when it issued L-208, whereas, defendant says, the record in these cases will not support such a conclusion.
The court did not hold that WPB purported or intended to exercise any of its several requisitioning powers when it issued L-208. The court noted the various authorities actually cited at the conclusion of L-208 including Executive Order 9024 which contained a delegation of the President’s requisitioning authority conferred by section 120 of the National Defense Act of 1916 (39 Stat. 166, 213). Beyond that, the court merely noted the various statutes in effect on the date of the issuance of L-208 which gave the Government wide powers to take private property needed by the Government to carry on the defense of the country in wartime, and held that under such a statutory scheme the Government appeared to have had adequate power to take what it in fact took from the plaintiff gold mine owners and operators.
On the matter of whether WPB “intended” or “purported” to act under any of the statutes giving the Government the power to take or requisition private property for war purposes, the court held that WPB purported to issue a priorities and allocation regulation; that to the extent that L-208 prevented the gold mine owners and operators from acquiring new equipment, material and facilities, L-208 was a proper priorities and allocation order, but that to the extent that L-208 denied those owners the right and clear authority which they and every other citizen have to make use of the materials, facilities and equipment which they owned and had on hand, in the operation of their legitimate and legal
The court did not hold, as counsel for defendant says it did, that L-208 was an invalid order. The court held that to the extent that L-208 actually allocated scarce materials away from the gold mine owners and operators it was a valid allocation order, but that to the extent that it deprived the gold mine owners of the right to use their mining properties by, “immobilizing” the materials, equipment and facilities owned by them and which they had on hand and needed to use to operate their mines, the order amounted to a temporary taking of their right and authority to profitably operate their mines.
The court expressly stated that an unauthorized taking is not compensable. It also stated that where there exists authority for a taking of a type of property and the Government, as it did here, takes that property, the uss by the Government of a means of acquiring that property, which means was not specifically spelled out by some specific statute, does not relieve the Government of the obligation of paying just compensation, citing, among others, the case of Edward P. Stahel & Co., Inc., et al. v. United States, 111 C. Cls. 682, cert. den. 336 U. S. 951. Where there is authority to take and a taking is accomplished, it is compensable. In the Stahel silk cases the Government had the statutory authority to take the plaintiffs’ silk; the Government did not “purport” to exercise that power but rather it purported to exercise a regulatory power by issuing Order M-251 freezing or immobilizing the silk in the hands of the owners themselves until the Government should place mandatory orders requisitioning the silk. This freezing order was held to be a taking and, because the Government had the necessary power and statutory authority to “take” the silk, the court held that it must pay just compensation for it and it did so.
Defendant’s counsel also says that the expression used by the court, “war necessity”, does not appear in the “taking statute” of October 16,1941, sufra. In using that expression the court was merely paraphrasing, as it had a right to do, the statutory language concerning the basis for the President’s determination that the property proposed to be taken was necessary to the prosecution of the war; that the property was needed for the defense of the United States; that the need was immediate and impending and that all other means of getting the property had been exhausted. Inasmuch as that statute and other requisitioning statutes then in existence required no particular procedure to be followed in the making of those determinations and provided no appeals therefrom, the court held such determinations were within the discretion of the President or his delegees.
The main complaint of defendant’s counsel seems to be that this court held that the Government had the necessary authority to take plaintiffs’ property whereas the question of “authority” was not exhaustively briefed by the parties to the court.
It should be noted that this is the first occasion in this lengthy litigation on which the Government has taken the position that it lacked authority to take plaintiffs’ property. No such contention has heretofore been made. Up to this point, defendant has contended that it did not take the prop
In the Central Eureka opinion, the court did not go as far as suggested in the Oro Fino decision because the court found that the existing statutory scheme at the time of the issuance of L-208 contained sufficient authority to cover the taking complained of and thus avoided that twilight area involving the right to just compensation where authority to take the property involved is not clear. On that point, in the recent decision of the Supreme Court in Bill Hatahley et al. v. United States, No. 231, decided May 7, 1956, the Court stated:
* * * The fact that the agents [of the Government] did not have actual authority for the procedure they employed does not affect liability. There is an area, albeit a narrow one, in which a government agent, like a private agent, can act beyond his actual authority and yet within the scope of his employment. * * *
The point involved in the Central Ewreka opinion was not the lack of authority to take, but rather the use by the Government of an unauthorized means of accomplishing an authorized taking. The court held that the use of an unauthorized means of taking what the Government had the authority to take, did not relieve the Government of the
The final position of defendant’s counsel seems to be that the only cases in which the Government may be required to pay just compensation for property which it is authorized to take and does take, are those cases in which the Government has expressly invoked a particular taking or requisitioning statute, has used the precise means of taking provided for in that statute, and has then refused to pay for what it has taken. This theory, if adopted, would rule out many taking cases among which are cases such as the silk cases, the set-aside order cases, the flooding cases, the Causby chicken farm case, and, in fact, most of the “taking” cases.
In these cases the court held simply that what the War Production Board did through the issuance of L-208 amounted to and constituted a taking through the placing of a servitude upon the use by plaintiffs of their property and plaintiffs were accordingly held entitled to recover. From this it seems clear, under the decisions, that there was a temporary taking under the Fifth Amendment. The court did not hold that there was anything illegal about the issuance of L-208 so far as its provisions were concerned. It merely held that when a Government agency has the power to take private property, as the War Production Board did, it does not have to act in some particular formal way in order that its action shall amount to a taking.
In view of the fact that defendant’s allegations of error are based on a demonstrably mistaken understanding of the court’s opinion and upon conclusions clearly not warranted by that opinion, inasmuch as the court did not hold that L-208 was an invalid order and did not hold that the War Production Board purported to act under or invoke the requisitioning powers contained in any particular statute, defendant’s motion for a new trial is overruled.
Madden, Judge, and Whitaker, Judge, concur.
The full text of L-208 Is set out In finding 43.
In Executive Order 8629, the President delegated his priorities power under section 2 (a) of the Act of June 28, 1940, 54 Stat. 676, and his power of requisitioning under section 9 of the Act of September 16, 1940, 54 Stat. 885, 892, including the power to take possession of plants. Further requisitioning power conferred on the President by the Act of October 10, 1940, 54 Stat. 1090, and the Act of October 16, 1941, 55 Stat. 742, were delegated to OPM by Executive Order 8942, Nov. 19, 1941.
Executive Order 9024, January 16, 1942; Executive Order 9040, January 24, 1942. The latter order delegated to WPB the President’s power under section 120 of the National Defense Act of 1916, 89 Stat. 213, to place mandatory orders and to take possession of plants.
On March 18, 1941, OPM Issued Regulation 5 (6 P. R. 1598, 32 CPR 2875— 1941 Supp.), establishing a new operating division known as the “Labor Division”. The functions and duties of this division were (1) to ascertain labor requirements for national defense; (2) to develop programs and coordinate efforts for assuring an adequate and trained labor supply for defense purposes; (3) to advise regarding problems and standards of work and employment in defense industries; (4) to assist in the prevention and adjustment of labor controversies which might retard the defense program; (5) to advise and collaborate with other divisions of OPM on all matters affecting labor.
See footnote 3, supra, for the functions and duties of this division.
When the War Manpower Commission was organized nnder Executive Order 9139, April 18, 1942, WPB’s labor supply functions were transferred to WMC.
The copy of the order is not in evidence.
A partial analysis based on the records of the Social Security Board, Indicates that the released gold mine workers went into a wide variety of occupations, including in addition to those mentioned in the text, coal mining, steel working, communications, transportation, and many others; they scattered, in short, through a fair cross-section of American industry. Letter, John J. Corson, Director, Bureau of Old Age and Survivors Insurance, Social Security Board, to Stacy May, October 22, 1943.
Wilbur Nelson and Arthur S. Knoizen, In interviews with the writer, March 7, 1944; F. H. Hayes, In an interview with writer, March 4,1944.