Elk Horn Coal Corp. v. Allen
1959 Ky. LEXIS 395, 324 S.W.2d 829 (1959)
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Rule of Law:
To establish abandonment of property, there must be clear, unequivocal, and decisive evidence of actual acts of relinquishment coupled with an intent to abandon; mere non-use or a change in a material's market value over time is insufficient. Reservations of minerals in deeds are interpreted to mean commercially extractable substances, not waste products that later acquire value.
Facts:
- Elk Horn Coal Corporation began coal mining operations on a 600-acre tract in 1914 and continued until 1941.
- The mineral deed granted Elk Horn the right to 'dump, store and leave upon said land any and all muck, bone, shale, water or other refuse' for an 'unlimited time,' specifying that cessation of exercise would not constitute abandonment.
- During the mining period, Elk Horn accumulated a large slate dump on the surface of the tract.
- Around 1926, spontaneous combustion caused a portion of the slate dump to burn, forming 'red dog,' which later acquired value for construction.
- After ceasing direct mining from entries on the tract in 1941, Elk Horn intermittently used material from the dump for mine roads and permitted a railroad company and others to take some.
- C. E. Allen and Jack Stanley acquired the surface rights to part of the tract.
- Allen and Stanley did not use or claim the slate dump until shortly before Elk Horn filed an injunction proceeding in 1956.
Procedural Posture:
- Elk Horn Coal Corporation initiated an injunction proceeding in the circuit court against C. E. Allen and Jack Stanley to determine ownership of a slate dump.
- The circuit court adjudged that Allen and Stanley owned the dump, finding it had been abandoned by Elk Horn.
- Elk Horn Coal Corporation appealed the circuit court's judgment to the Kentucky Court of Appeals.
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Issue:
1. Does a mining company abandon its right to a slate dump, which it was contractually permitted to store indefinitely, simply because it ceased active mining on the tract, did not make continuous use of the material, or because the material (like 'red dog') only recently acquired merchantable value? 2. Is 'red dog,' a burnt waste product from coal mining operations, considered 'stone' reserved to the surface owners under a mineral deed when it did not exist as merchantable stone in the earth and was not extracted as such?
Opinions:
Majority - Cullen, Commissioner
No, the Elk Horn Coal Corporation did not abandon its right to the slate dump. Abandonment requires actual acts of relinquishment accompanied by an intention to abandon, and mere lapse of time or non-user without other evidence of intent is generally insufficient. The mineral deed explicitly granted Elk Horn the right to store materials indefinitely, and stated that a cessation of activity would not constitute abandonment. The fact that the 'red dog' only recently acquired merchantable value does not indicate abandonment, especially since Elk Horn kept the pile orderly, used materials from it when needed, and promptly asserted ownership when challenged. The burden of proving abandonment rests upon the party asserting it, requiring clear, unequivocal, and decisive evidence, which was not met here. No, the 'red dog' is not considered 'stone' reserved to the surface owners. The reservation of 'stone' in the mineral deed is interpreted to mean a mineral in the class of stone that is sought and extracted from the earth for its value as such. The substances that eventually formed 'red dog' were removed as a necessary part of coal mining operations, did not exist in the earth as merchantable stone, and only assumed the character of stone after the burning process. Therefore, it does not fall within the intended scope of the 'stone' reservation.
Analysis:
This case significantly clarifies the high evidentiary bar for proving abandonment of property rights, particularly in the context of mineral interests where deeds specify storage rights and non-abandonment through non-use. It reinforces that intent to abandon must be demonstrated through overt acts of relinquishment, not merely inferred from passive non-use or changes in market value. Furthermore, the decision provides crucial guidance on interpreting mineral deed reservations, emphasizing a practical, commercial understanding of terms like 'stone' at the time of extraction over purely geological definitions, which is vital for future land and mineral rights disputes.
