Fulmer v. Williams

Opinion, Mr. Justice Green: There is but a single and very narrow question for decision in this case. It is agreed on both sides that the defendant shall account to the plaintiff for the value of the slate in place. But in the determination of what was the value of the slate in place, the master adopted one method and the court another. The master held that the value of the slate on the bank, less the cost of mining and putting it there, with a margin for a fair and reasonable profit to the operator, represented the value of the slate in place, and therefore charged the defendant with the valuation thus produced. The court, however, held that the value of the royalty or slate-leave which could be obtained for the privilege of removing and manufacturing the slate was the true representative of the value of the slate in place, and therefore reversed the finding of the master and charged the defendant upon the latter principle. The difference in the resulting figures is very considerable and only one of the two methods can be correct. The act of April 25, 1850, P. L. 573, which subjects tenants m common in possession of mineral lands to accountability to their co-tenants for minerals taken out, provides only that the sum which “ may be justly and equitably due,” shall be ascertained and paid. This language is perhaps sufficiently general to give rise to different views as to what sum it is that “ may be justly and equitably due ” in any given case, and the solution of the question depends somewhat upon the circumstances of the particular case, and somewhat upon the true character of the relation existing between the parties. If the relation [39] were one of partnership, of course the accounting partner would be responsible for whatever profit he might realize out of his dealing with the partnership property. In that view of the case the master’s measure of liability would be certainly correct in any event, and doubtless a still more rigid accounting than he applied would have to be enforced. But the relation of tenants in common of land is not in any sense a relation of partnership. The tenant in possession may lawfully remain in possession and may take minerals or other valuable products for his own advantage. His ownership is such that he cannot take his own share, without also at the same time and by the same act taking the share of his co-tenant. But in mining operations there is always more or less expense and risk which must necessarily be incurred by the person who conducts them. The tenant out of possession incurs none of the risk or expense, when the mining operations are conducted exclusively by the tenant who is in possession. Nevertheless, he is entitled to be compensated for the appropriation by his co-tenant in possession for his proportion of the mineral taken by the latter, whether the appropriation be profitable or otherwise to the taker. This view of the subject simplifies and narrows the scope of the inquiry. For the thing taken is mineral in place, as it lies in a state of nature. It is this of which the tenant out of possession is deprived, and it is this for which he ought to be compensated. Where the mineral land has never been developed and no mines or quarries have been opened, the fair market value of the mineral in place, which would be the value of the privilege of removing it, in view of all its special circumstances, would represent the true measure of compensation to the owner. So, too, if the land were fully developed and mines or quarries opened, and all the expenses incurred which enable the operator to proceed at once to the taking of the mineral, the value of .the mineral in place, ready to be taken, would be enhanced by these considerations, and the price of the privilege of taking it in such circumstances would also represent the measure of compensation. It is manifest that in conducting this inquiry in a litigated case, regard should be had to all the circumstances of the particular case, and the evidence should be directed to the special instance of the mine or.quarry in question. \ [40] A reading of the testimony taken before the master shows that this is precisely what was done in the present case. On the part of the defendant a number of witnesses, all of them having competent knowledge of the property, and being themselves engaged in the same business and thoroughly qualified to speak of the value of the privilege of removing the slate from this particular quarry, testified to their opinion of the value of that privilege as represented by a fixed price for the several kinds of slate produced. They took into their view all the circumstances of advantage and disadvantage in mining, preparing and marketing the slate taken, and expressed their results in definite figures. Reviewing carefully and as we think correctly, the whole of this testimony the learned court below determined upon certain values for school slate, roofing slate, and mantel and blackboard stock taken out, and embodied them into a resulting decree, the fundamental idea of which was that they represented the royalty or slate-leave at which the quarry could have been let. For the legal correctness of this treatment of the subject the case of Neel’s App., 8 Penny. 66, was referred to, and it appears to support the reasoning of the court and the defendant’s contention. We think, moreover, it is the just and equitable method of determining the value of the slate in place, when compensation for its removal is claimed by a tenant out of possession against a co-tenant in possession. The learned master reached a different conclusion as to the manner of determining the value of the slate in place, influenced largely by the decision of this court in the case of Coleman’s App., 62 Pa. 252. An examination of that case however proves that it was altogether exceptional in its character, and was expressly limited to the particular facts under consideration. The general principles stated in the opinion are in entire harmony with the views herein expressed. Thus, Mr. Justice Sharswood, in delivering the opinion, said: “The value of the ore in place is, therefore, the only just basis of account. That is the same as the value of the ore-leave ; that is, what the right to dig and take the ore is worth.” He then inquires, “But how is the value of the ore-leave to be ascertained?” He proceeds to review the special facts of the case and says that the value of the ore at the pit’s mouth depends [41] upon its quality, it proximity to the furnace where it is to be used, and the means of transportation; that, in addition to this, the price of the ore-leave will be influenced by the expense and risk of mining; that the price paid for ore-leave in other mines affords no criterion for this ; that no sales of Cornwall ore-leave had ever been made, and that no evidence was given before the master as to what ore-leave from this bank would have commanded on the market. He adds, that the master arrived at the value of the ore in place by ascertaining its value at the pit’s mouth and then deducting from that the cost of mining, and says: “We cannot see that under all the circumstances any more just and equitable mode could have been adopted.” But he takes - care to say further : “ We do not mean to say that it would hold in any other case than the one now before the court; certainly not, where the mining is expensive and hazardous..... But the case of the Cornwall ore banks is very different and very peculiar. Very little outlay of capital was required. The wages of day laborers, and the pick axe and shovel, with occasional charges of powder for blasting, made up all that was provided. The returns were immediate; the ore was removed to be used or sold as soon as loosened. No personal skill or superintendence by the tenants in common was shown, and whatever was necessary was hired and allowed in the cost of mining.” The whole tendency of the opinion was to show that there was no substantial difference between the value of the ore in place and its value at the pit’s mouth, except the mere cost of digging and of removing it from the one place to the other. This, added to the fact that there never had been any sales of ore-leave at the Cornwall banks, and no proof of the opinions of experts as to what such ore-leave was worth, impelled the adoption of the principle upon which the value of the ore-leave was determined. There was in fact no other method which could have been adopted in that case under the evidence on the record. In the present case, it is only necessary to note the fact that abundant evidence was given as to the value of the royalty or slate-leave, in this particular quarry, by very experienced persons who knew it well and had long been engaged in the same business; and the further fact that the value of the slate on the bank included, in addition to the cost of severance and re [42] moval, the cost also of splitting, dressing and piling the roofing slate, and splitting the school slate and mantel and blackboard stock. In addition to this, personal skill and superintendence were required. As to the roofing slate the whole profit of manufacture thus enters into its cost on the bank, and a portion of that profit enters into the cost of the school slate and other stock. It follows, that if the method adopted by the master is pursued, the plaintiff would recover, in addition to the real value of the slate in place, a share of the profits of carrying on the business without being subject to the risks or possible losses which might accrue, and this we think would not be just and equitable. The amounts allowed by the court are very fair and liberal to the plaintiff, under all the evidence, and he has no just cause of complaint. The case of Ege v. Kille, 84 Pa. 333, was not a proceeding between tenants in common, but an action of trespass for mesne profits, and therefore a rather more stringent rule of accounting would be applicable to its facts. But, in addition to that consideration, it was a case of iron ore mining and came practically within the exceptional doctrine of Coleman’s Appeal, supra, which it simply followed. That doctrine however, as we have seen, has no general application, and is not controlling in cases circumstanced like the present. The decree of the court below is affirmed and appeal dismissed at the cost of the appellant.