Grubstaking, Leasing & Selling

Grubstaking, these days in fact, is something that has been done from the time that prospecting was done and is such as well set up arrangement that in some places such as California, the agreements that are signed also need to be recorded. Actually, a lot of the problems that have come up from grubstaking have not been due to the fact that the people in either party are dishonest, but rather a misunderstanding in the initial terms of what needed to be accomplished. Let us say for example that you have gotten prepared to work on prospecting for gold, however you do not have the necessary capital to do so. Somebody else that is interested and that does have the capital makes an agreement with you and says he will buy your food and clothing and maybe even forward some money in advance for additional expenses. The idea of this is that you and the person with the capital become partners and any finds that are made need to be split for example fifty fifty. This means that half of anything that you find and locate corresponds to your partner who is paying for all your expenses. There have been a number of mines in the past, especially gold mines that have started up with this sort of arrangement.

Grubstake Story
There have been some very rich gold finds in some places where lots of prospectors went to in the past such as in Whitney Tisdale townships close to Porcupine Lake in Ontario. The finding was so rich in fact that it created a small gold rush. There was a young barber by the name of Benny Hollinger and his partner Alex Gillies, who were both in Haileybury trying their shot at getting grubstakes. It took Alex Gillies a good while to convince Jack Miller to give him one hundred dollars to start this. Benny Hollinger tried to convince Jack McMahon but was not as successful as his partner and only ended up with forty five dollars to start out with. Jack McMahon did not think much about the venture and decided to sell half interest of his share for fifty five bucks to Gilbert Labine. The result of the set up grubstaking was that even though Hollinger and Gillies were together as a team, they were still representing different backers. They ventured out on their search and located an abandoned test pit where rusted anvil and forge had been left for a few years. It was said that the man who previously tested the pit (Reuben D’Aigle) missed a big fortune by only a little bit, and this was discovered later on when an assay was done of the gold sample they picked up from the bottom of the hole which was at $52 per ton. The men found this area and were successful after they had begun to stake their claims on the basis of very extraordinary discovery. It was said that at one point Gillies was cutting a discovery post while his partner Hollinger was pulling some moss off the rocks just a few feet away, when suddenly Hollinger yelled out very loudly and threw his hat at Gillies. Gillies thought his friend was insane because of his reaction but that as soon as he observed what Hollinger had seen, he understood. They had found quartz which looked as though somebody had dripped candle wax along it but that instead of being wax it was gold. The quartz was close to three feet out of the ground and was around six feet in width. The gold stood over the ground and went close to sixty feet through the vein.