Scrip Scrap

In the golden '20s, no one seemed to have a more golden touch than a young man named Errett Lobban Cord. By the time he was 39, the ex-Los Angeles used-car salesman had built an empire that ranged through motors (Auburn, Checker Cab, Cord), ships (New York Shipbuilding), aircraft (Stinson, Lycoming engines) and airlines (American Airways). But in 1937, Cord came a cropper. The SEC charged him with manipulating the stock of Checker Cab and Auburn, and he sold most of his empire to a group headed by Banker Victor Emanuel.

Cord, shorn of power but not of wealth, dropped out of the public eye, quietly began to pyramid his millions in Los Angeles real estate. He is still one of Wall Street's biggest speculators, has a Beverly Hills mansion, three Nevada ranches, a fleet of 20 cars (mostly Cadillacs) and two planes which he usually flies himself. Last week, at 56, Cord was back in the news with an incredible scheme to get control of some of the richest submerged oil wells off Louisiana and California. "Back in the old days," says Cord, "they called some of my deals fantastic. They weren't. They were simple business deals in essence. But this situation--this is truly fantastic."

Desert Claim. It was so fantastic that nobody would have given the scheme a second thought if Cord's once-magic name hadn't been attached to it. Even at that, it sounded like moonshine. Cord had discovered that land "scrip" certificates authorized by Congress as long as a century ago to deserving U.S. citizens are still available. There are three types of federal land scrip.* All entitle the holders to stake claims on unoccupied public land, most of which now is on mountaintops, deserts, etc. There is no doubt that the scrip is still good for some land; only a fortnight ago, land in Alaska was handed over to holders of scrip originally granted to two Civil War veterans. But in the past, there has been litigation over what kind of land the scrip can be used for.

Cord and his friends began buying up scrip from heirs. In 1947, they laid claim to ten borax-rich acres in California's Mojave Desert. The Interior Department refused to recognize Cord's claim on the ground that his scrip could not be used for mineral land. Cord's appeal is still pending in court.

Watered Titles. After the Supreme Court ruled that the Federal Government owns the long-disputed tidelands in 1947, Cord said that he and associates loaded up on certificates (total outlay: more than $1,000,000) permitting them to claim more than 4,000 acres of land. Last February, Cord filed claims on land containing 92 oil and gas wells off the coast of Louisiana with estimated reserves of oil worth $100 million. He argued the land was unoccupied, since the court decision had made the owners of the wells mere squatters. Last year, Cord filed claims to more land off the California shore.

Through it all. Interior Secretary Oscar Chapman stayed mum. Sniffing skulduggery, Louisiana's Democratic Congressman E. E. Willis fired off a letter to Chapman, sarcastically pointing out that homestead scrip was never intended to help start a farm "at the bottom of the Gulf of Mexico." Willis demanded to know why Chapman, who usually acts on mineral lease applications in a matter of days, has let months pass without denying Cord's claims. By last week Chapman had still taken no action, but Interior officials said privately that Cord's claims will be tossed out. Another possible obstacle: Congress may pass a bill, now pending, to return the tidelands title to the states. In any case, Cord is prepared to carry his claims up to the Supreme Court.

*The types: 1) individual scrip, issued in each case by a special act of Congress to individuals for services to the Union, e.g., Joseph Gerard, who was killed by Indians in 1792 while carrying a message for the U.S.; 2) land exchange scrip, issued when private land was swallowed up by creation of national forests, etc.; 3) soldiers' additional rights, issued in 1874 and later, granting additional land to Civil War veterans who had already started homesteads.

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