Quality Excelsior Coal Co. v. Reeves

177 S.W.2d 827, 206 Ark. 713, 1944 Ark. LEXIS 533
CourtSupreme Court of Arkansas
DecidedJanuary 31, 1944
Docket4-7206
StatusPublished
Cited by12 cases

This text of 177 S.W.2d 827 (Quality Excelsior Coal Co. v. Reeves) is published on Counsel Stack Legal Research, covering Supreme Court of Arkansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Quality Excelsior Coal Co. v. Reeves, 177 S.W.2d 827, 206 Ark. 713, 1944 Ark. LEXIS 533 (Ark. 1944).

Opinion

McFaddin, J.

This appeal concerns some of the relative'rights and duties of the lessor and the lessee in a coal mining lease.

Appellee, as lessor, filed suit in the chancery court to enjoin the appellant, as lessee, from using the subterranean passages under lessor’s land for removing coal from adjacent lands, and also to recover damages at five cents per ton for all coal from adjacent lands so removed through the subterranean passages under lessor’s land. Appellant demurred to the chancery jurisdiction, and also pleaded laches and estoppel, and claimed that the right to use the subterranean passages was an implied part of the lease under the facts in this case. The chancery court found for the appellee and awarded damages at l%c per ton on all coal from adjoining lands hauled under lessor’s land (which damages amount to $625), and also enjoined appellant from such unauthorized use of the subterranean passages. This appeal followed.

The lease here involved was executed in 1936 when appellee, Beeves, as lessor, entered into a lease contract with Quality Coal Corporation, as lessee, whereby lessor granted to lessee “the right to mine and remove the coal remaining beneath the surface of” 160 acres in a square block for the term of ten years . . . with the privilege of renewal for five years additional. The lessee, among other things, agreed: (1) to mine the coal continuously, actively, ‘ ‘ and in a method calculated to insure the eventual mining of the largest amount of coal from the premises; and (2) to pay royalty at fifteen cents per ton for each ton of coal mined from the premises; and (3) if for any year “the total amount of royalty accruing to the lessor on the basis of fifteen cents per ton on all coal mined does not equal $600' a year, a sufficient additional sum will be paid by lessee to lessor which when added to the royalty already paid, will equal $800 for each year”; and (4) to furnish lessor each six months proper and sufficient maps and plats covering the underground operations; and (5) to allow lessor “at all times to enter the leased premises . . . and all entries and working places for the purpose of examining and surveying same”; (6) at-the termination or expiration of the lease to surrender the “premises, rights, privileges, and easements hereby granted together with all mines, entries, openings, and passageways located therein or thereunder.”

The lease was, with the consent of the lessor, assigned to the appellant herein, which was thereafter treated as the lessee. We will refer to the parties herein as “lessor” and “lessee” just as though the present appellant had been the original lessee. Operations have been continuous since 1936, and coal has at all times been mined from the lands of the lessor. The lessee has installed machinery and equipment valued in excess of $60,000, and has paid the lessor royalties aggregating $48,000. The surface opening is located on lands north of, and adjacent to, the leased lands here involved. The main slope, tunnel, or subterranean passage, under lessor’s land, extends almost due south through the center of the 160-acre block,, and has been extended in this direction as the coal was mined. Side entries extend east and west from the main slope to the boundaries of the 160 acres. When the suit was filed and tried below, the main slope extended south from the lessor’s land into adjacent lands, and some of the entries also extended to other lands. Appellant is mining coal from adjacent lands to the south and to the east of lessor’s lands, and is hauling this coal from the adjacent lands through the subterranean passage of the main slope on lessor’s lands to the surface opening located on the lands immediately north of lessor’s land. Other facts will appear in this opinion. Seyeral questions are argued in the briefs and will now be considered.

I. The Right of the Lessee to Use the Passages Under the Lessor’s Land to Remove Goal from Other Lands. At the outset appellant concedes that the lease under consideration contains no express grant' to the lessee to use the passages under the leased lands to remove coal from other lands, but insists that the right is an incident to the lease and is implied in the lease so long as the lessee is removing coal from the leased premises. Appellee contends that this right of passageway must be expressly granted or it is denied. There are two lines of authority on this question. In those jurisdictions where a coal mining lease is a sale of the minerals in place, then the lessee is generally held to have the right of haulage as here sought by appellant: N. Y. & Pittston Coal Company v. Hillside Coal & Iron Company, 225 Pa. 211, 74 Atl. 26; Middleton v. Harlan-Wallins Goal Corp., 252 Ky. 29, 66 S. W. 2d 30. See, also, Annotation in 15 A. L. R. 857 for other cases. ¡But in Arkansas we have clearly-held that a coal mining lease is not a sale of the minerals in píace, but only a right to mine and remove the minerals in accordance with the lease. Goodson v. Comet Coal Co., 182 Ark. 192, 31 S. W. 2d 293; Quality Coal Co. v. Guthrie, 203 Ark. 433, 157 S. W. 2d 756. In the first of these cases (Goodson v. Comet Coal Go.) the mine operator (lessee) secured from the owner of the minerals a special instrument granting the right to use the underground passages to haul coal from adjacent lands. This would clearly imply that the right did not exist in that lessee independent of a special agreement. In the second case (Quality Coal Co. v. Guthrie) it was clearly held that the lessee did not have the implied right to use the underground passages to haul coal from adjacent lands. So we stand committed to the rule that the right of haulage from adjacent lands is not a right incidental to, or implied in, a coal mining lease.

One of the most scholarly and exhaustive opinions on this subject is that of Percy La Salle Mining & Power Co. v. Newman Mining & Milling & Leasing Company decided by the United States District Court in Colorado and from which there was no appeal. This opinion is reported in 300 Fed. 141, and has been cited in several jurisdictions. We quote from it extensively:

“What does a mining lease vest in the lessee? Providence Mining & Milling Co. v. Nicholson, 178 Fed. 29, 101 C. C. A. 157, held that a mining lease conveys nothing but a right to search for and extract the minerals, and that the lessee acquired no other rights, and that the title in all other respects remained in the lessor. See, also, Butler v. McGorrisk, et al., 114 Fed. 300, 52 C. C. A. 212. In Ewert v. Robinson, et al., (C. C. A.) 289 Fed. 740, Judge Kenyon’s review of the authorities construing leases shows that in the western states, at least, in the absence of an expressed covenant, the ordinary oil or mining lease conveys no title to the mineral in place. Further, the Supreme Court held in United States v. Biwabik Mining Co., 247 U. S. 116, 38 Sup. Ct. 462, 62 L. Ed. 1017, that a mining lease was not to be construed as a conveyance of ore in place, in spite of the fact that the latter could be measured with substantial accuracy. In other words, it grants merely an incorporeal hereditament or easement, and not an estate in fee.

“What the lessee contends for here is the right to mine by ‘ outstroke, ’ which means the raising or removal of ore from a mine adjoining the demised premises through a shaft or opening on the latter.

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Bluebook (online)
177 S.W.2d 827, 206 Ark. 713, 1944 Ark. LEXIS 533, Counsel Stack Legal Research, https://law.counselstack.com/opinion/quality-excelsior-coal-co-v-reeves-ark-1944.