Natural Resources Commission v. AMAX Coal Co.

603 N.E.2d 1349, 126 Oil & Gas Rep. 477, 1992 Ind. App. LEXIS 1716, 1992 WL 339736
CourtIndiana Court of Appeals
DecidedNovember 24, 1992
Docket49A04-9112-CV-419
StatusPublished
Cited by2 cases

This text of 603 N.E.2d 1349 (Natural Resources Commission v. AMAX Coal Co.) is published on Counsel Stack Legal Research, covering Indiana Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Natural Resources Commission v. AMAX Coal Co., 603 N.E.2d 1349, 126 Oil & Gas Rep. 477, 1992 Ind. App. LEXIS 1716, 1992 WL 339736 (Ind. Ct. App. 1992).

Opinion

MILLER, Judge.

This is a consolidated case involving the inter-relationship of surface coal mining and ground water rights in Indiana. The common question in both cases is whether the Department of Natural Resources by the Natural Resources Commission (collectively-the Department) has the authority under the Indiana Surface Mining Control and Reclamation Act (I-SMCRA) 1 to affect in any way existing water rights. After first deciding that I-SMCRA preserved state water rights and therefore could not impact existing common law water rights, the Department changed its mind and attempted to regulate the use of ground water by surface mines so that such use would not result in damage to property located outside the surface mine area. After an exhaustive series of administrative hearings followed by judicial review, the trial court held that the Department had it right the first time-nothing in I-SMCRA can affect in any way existing common law water rights. Therefore, the trial court found that the Department had exceeded its authority by issuing orders that interfered with the common law water rights of the coal miners to make any non-malicious use of ground water on their premises.

We agree with the trial court and affirm.

FACTS AND PROCEDURAL HISTORY

Surface coal mining permits in Indiana are issued by the Department pursuant to provisions of I-SMCRA, Indiana's counterpart to the Federal Surface Mining Control and Reclamation Act of 1977 (F-SMCRA), 2 and the regulations implementing I-SMCRA set forth at 310 Ind. Administrative Code 12. Before beginning surface coal mining, an operator is required to obtain a permit from the Department. These permits are approved only after intense seruti-ny of the proposed mining operations and the anticipated effects related to them by the Department's technical experts.

Appellee AMAX Coal Company (AMAX) sought a permit to extend its Minnehaha Mine, Cass Pit, a surface mine in Sullivan County to mine a new area of what is known locally as the No. 7 coal seam. 3 Appellee B & LS Contracting (B & LS) had been conducting surface mining operations at the Hornet Mine in Clay County since a permit was issued in 1989 in order to recover coal owned by Shand Mining, Inc.

AMAX's permit application described its proposed operations, which included pumping water on its lands from the abandoned mines in the No. 6 coal seam, to prevent flooding in its mining pit. Appellant Jack L. Jarrett (Jarrett), an adjacent surface landowner, opposed the operation arguing *1351 that the removal of water and/or lowering of the existing water head (pressure) in the No. 6 seam abandoned mines might cause subsidence on his land. 4 Jarrett argued that the water was "substituted support" which replaced the natural support removed by the mining of the No. 6 coal. The permit was approved in May, 1989, except for, inter alia, the pumping of water from the No. 6 coal. The Department added what is now known as "Condition 12" to the permit. Condition 12 prohibited additional depressurization wells in the permit amendment area "until sufficient detail is added to the statement of probable hy-drologic consequences to determine the effects that dewatering may have on potential subsidences both with the permit and adjacent off site areas." See R. 1683, Natural Resources Commission et al. v. Amax Coal. AMAX sought administrative review challenging the Department's jurisdiction and authority to impose Condition 12. The Administrative Law Judge overruled AMAX's objections to Condition 12. That ruling was in turn affirmed by the Department which then remanded the remaining questions regarding the permit to the Administrative Law Judge for further proceedings.

The trial court held that the imposition of Condition 12 on the Cass permit was unlawful and in excess of the Department's authority. The court found that the escaping water which appeared on AMAX's land was a part of its land and belonged to AMAX. Under Indiana water rights law, there was no obligation of lateral support placed upon land owners to prevent the escape of ground water from other lands. In addition, the trial court found that there is nothing in Indiana law that would allow a landowner whose predecessors have sold rights-including the removal of natural support and the right to subside the surface-to replace these rights by limiting the rights of others or by placing on others new or additional lateral support duties. Finally, the trial court found that the undisputed facts showed that the natural necessary subjacent support was removed by underground mining in the No. 6 coal seam and the subsequent flooding of the abandoned mine works even further decreased the - remaining - support. Percolating ground water could not, and did not, replace the naturally necessary support. 5 Therefore, the trial court reversed the order of the Department and remanded the case.

B & LS had been pumping both surface and ground water which accumulated in its pit. The removal of the ground water had the potential to lower water in bodies of water in the vicinity of the Hornet Mine. All of these bodies of water are former strip mines which have filled with water over the years since mining ceased. None are natural lakes or ponds. These former strip pits have hydrogeological connections with the Hornet Mine of varying types and degrees, some natural and some caused by mining activity. As a result, the removal of water from the active mine had lowered water levels in some of the strip pit ponds. When pumping stopped, the strip ponds refilled. Due to the variable and unpredictable nature of the hydrology in the area, 6 *1352 the only way that B & LS could avoid the possibility of lowering water levels in the strip pit ponds outside their permit area was to discontinue mining.

When B & LS's permit was approved (July 15, 1988) the Department took the position that I-SMCRA preserved state water rights and that it had no authority to require a surface mine operator to avoid dewatering. The Department's position was that Wiggins v. Brazil Coal & Clay (1983), Ind., 452 N.E.2d 958, still controlled common law water rights in Indiana. 7

In May of 1991, following its decision against AMAX Coal, the Department issued an order which unilaterally altered B & LS's previously issued permit stating that "if temporary or permanent lowering of water bodies causes damage it will be contrary to [the Department's] interpretation of I-SMCRA." R. Vol. I, p. (§)(5), State ex rel B & LS Contracting, Inc. and Shand Mining v. Indiana Department of Natural Resources et al.

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Related

Natural Resources Commission v. AMAX Coal Co.
638 N.E.2d 418 (Indiana Supreme Court, 1994)
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579 N.E.2d 721 (Ohio Court of Appeals, 1989)

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603 N.E.2d 1349, 126 Oil & Gas Rep. 477, 1992 Ind. App. LEXIS 1716, 1992 WL 339736, Counsel Stack Legal Research, https://law.counselstack.com/opinion/natural-resources-commission-v-amax-coal-co-indctapp-1992.