Genet v. President, Managers & Co. of the Delaware & Hudson Canal Co.

Van Brunt, P. J.: This action was brought in February, 1893,, for the purpose of declaring the contract mentioned in the complaint executed and ended, and compelling the defendant to remove its personal effects from the property which was • the subject-matter of the contract, and, which was situated in the State of Pennsylvania; and relief was also asked that the defendant, its agents and servants, be enjoined and restrained from claiming any further interest in the property under the agreement, or from claiming or alleging any ' right, title or claim’ thereto, and from denying the rights of plaintiff to the property free of the agreement or in any,way interfering with plaintiff’s right and title to the premises, the same as if said agreement had never been made, or that they be adjudged to release the same to the plaintiff. The defendant' answered, putting in issue' the material allegations of 'the complaint. The .issues thus formed came on for trial, and the court awarded judgment dismissing the complaint upon the merits. The grounds for the decision were: -1. That the'coal upon the lands described'in the complaint as belonging to the plain-. tiff is not exhausted, and that defendant did not commit any .act ' ■ or suffer any default respecting "said lands of the plaintiff which justifies putting an end to the contract referred to in the complaint, ' or which entitles the plaintiff to the equitable relief she claims, or to any relief consistent,with the causes of action alleged. 2. That the instrument sued upon is in the nature of a grant of coal under the. surface, and the defendant has acquired a base fee therein,' determinable only when the coal upon said lands and upon' the adjoining and contiguous lands is exhausted.; and that said- coal is not exhausted. 3. That the question of title concerning said coal and ■the construction of the instrument sued .upon must be determined by the laws of. the State of Pennsylvania, where the- lands are situated ; and the law’of said State concerning title to such lands is as testified to by Chief Justice Paxon, and Judges Hand', and Heydrick, the experts produced by. the defendant. From this judgment the present appeal is taken. In the consideration of the questions presented upon this appeal it will be necessary to comment upon the various litigations.which the parties to this action have had since the execution of the agreement [493] referred to in the complaint. It appears that in November, 1881, the plaintiff brought an action in the Superior Court of the city of New York, claiming violations of the agreement on the part of the defendant in its -failure to work the coal mines to the extent contemplated iy the agreement, and in the erection of works upon the premises-not contemplated by the agreement and making the lands of the-plaintiff subservient to adjoining lands belonging to the defendant.. The plaintiff claimed damages by reason of .the breach of the agreement and an injunction restraining -the use of her lands for the-benefit of adjoining lands. The defendant answered admitting-the agreement, denying its violation and alleging a prior adjudication between the parties. The action was tried before a referee,, who reported in favor of the plaintiff, and a judgment was thereipon entered in February, 1887, adjudging the plaintiff entitled toecover damages, and also adjudging that the defendant should hern joined and restrained from using certain erections upon the lands->f the plaintiff for the purpose of mining and preparing for market oal from the defendant’s lands, or from any other adjoining or ontiguous lands, and enjoining and restraining the defendant from iepositing the waste from coal mined from land, other than the land' f the plaintiff, upon the surface of the plaintiff’s lands, and alsolestraining it from running the water from other contiguous; finds upon the plaintiff’s lands for the purpose' of draining thenner. (An appeal was taken to the General Term by the defend|nt from this judgment and it was modified. The defendant-hereupon appealed to the Court of Appeals, and the judgmentgainst the defendant was reversed and the complaint dismissed,, ith costs, the court holding that the legal effect of the agreement-tween the parties was to vest in the defendant an. estate in fee in Ire coal as a separate piece of land, and that the defendant acquired present, absolute, distinct and independent right to the use of theIructure upon the plaintiff’s land for the mining of coal on the[ijacent lands, and that the only obligation' which rested upon theefendant as to the quantity of coal to be mined from the plain- - ff’s land Was to mine tire quantity specified each year, and whileey fulfilled-that obligation the defendant’s, right to take coal from; e adjoining property through plaintiff’s land could not be interIred with, and that the defendant had the right to pile upon.. [494] plaintiff’s land the refuse coal taken from the adjoining lands, and that it also had the right to take the water from its. adjoining lands upon the plaintiff’s lands for the purpose of facilitating them in drainage. (122 N. Y. 505.) In March, 1888, the plaintiff commenced another action in the Supreme Court of this State alleging improper, unskillful and unworkmanlike management - in the conduct of the mining opera- , tians by the defendant upon the lands of the plaintiff, whereby the., mine situated upon the plaintiff’s land was seriously injured and its value impaired, and damages to a large amount were claimed because thereof. The defendant demurred upon the ground that the court had no jurisdiction of the subject of the action, and that the conn plaint did not state facts sufficient to constitute a cause of action. The Special Term overruled the demurrer, and from the judgment thereupon entered an appeal was taken to the General Term, and the judgment ivas reversed and the complaint dismissed. An appeal from this judgment-was taken to the Court of Appeals, where the judgment, of the General Term was reversed and that of the Special Term .affirmed (136 N. Y. 593), the court holding that although the Second Division of the Court of Appeals had in the action herein-before referred to as being brought in the Superior Court, expressed .the opinion that this contract operated as a deed to convey the coal to the defendant, such decision was not material to a disposition of the case before that court, nor was it necessary to its determination or within the issues presented, and it was not, therefore, necessarily the law between the parties, although the court might regard it as a precedent; but that the right of the defendant t-o use the shafts and machinery on the plaintiff’s lands .in aid of the mining operations on adjoining lands, the right to pile waste upon the surface of the plaintiff’s, land, and the right of drainage .thereon- were involved in the action before that court, and its decision settled the law upon this subject between the parties. The court then proceeded to -examine the question as to whether the contract between the parties ■did or did not convey the coal in fee, and held that neither by the law of the. State of New York, nor by the law of the State of Pennsylvania, as gathered from the' decisions of that State, was the agreement between the parties a present conveyance of the coal upon the plaintiff’s. land, but was an executory contract,, the thing sold and [495] the price to be paid being dependent upon the revelations of the coal-mining process And the court further held that the terms of the agreement raised an implied promise on the part of the defendant not willfully or negligently to incapacitate itself from taking out more than the miqimum quantity of coal; that it was not in the contemplation of the parties that the plaintiff should be compelled to content herself with the minimum rate of royalty provided for hy the agreement, but that she had a right to rely upon the fact of the advantageous nature of the contract to the defendant, and that its own interests would necessarily induce it to mine all the coal which was possible, and by this means the royalty to the plaintiff would be increased far above the minimum; and that, if by unskillful conduct this result was rendered' impossible, the plaintiff had a right of action upon this implied promise of the defendant for the damages sustained by the willful or negligent acts of the defendant whereby it incapacitated itself from taking out more than the minimum quantity of coal. In the Matter of the Kings County Elevated Ry. Co. (112 N. Y. 47) the right of the company to build its road, although the specifications and plans filed under the law were indefinite upon certain points, was sustained by the court upon the same principle, namely, that the interests of the parties building and operating the road would necessarily impel them to make the structure conform to the requirements of the statute, although their specifications and plans were not definite in that regard. In view of the decision of the Court of Appeals upon the question as to whether this was a present conveyance or an executory contract, it does not seem necessary to discuss the subject any further. It is clearly in opposition to the view which was taken by the learned judge in the court below in the disposition of this case. Pie held, notwithstanding this decision of the Court of Appeals upon this identical contract, that the instrument in question was a deed, and that the question of title concerning the coal and the construction of the instrument must be determined by the law of Pennsylvania-—and, inferentially, that such was the law of that State. It is true that he also held that the plaintiff was not entitled to relief because the coal upon the land had not been exhausted, nor had the defendant committed any act or suffered any default [496] respecting the lands of the plaintiff which justified putting an end to the contract, or which entitled the plaintiff to any relief consistent with the causes of action alleged. But it is manifest that the basis of his decision was his interpretation ■ of the instrument, - and it seems to be equally clear that such interpretation is different from that which has been placed upon it by the Court of Appeals in another action between the same parties. It may be entirely true that the court was justified in finding that the contract had not been executed because of the exhaustion of the coal upon the land of the plaintiff. But it is not so apparent that .the plaintiff may not be entitled to some relief under the implied promise contained in the agreement its interpreted ;by the Court of Appeals, by reason (if she establishes the fact) of the unskillful manner in which-the defendant has conducted its mining operations, under the agreement. It may very well be that such a state of facts might be shown as would justify the court in terminating the contract because of the willful violation by the defendant of its duties in respect to the method of conducting the work, rendering it unsafe and improper for the plaintiff to permit her property to run the risk of absolute destruction if left to the tender mercies of the defendant. We think, upon the whole case, therefore, that the judgment should be reversed and a new trial had, with costs to the appellant to abide the event. Barrett, Rumsey, Williams and Patterson, JJ., concurred. Judgment reversed and new trial ordered, with costs to appellant ' to abide event.