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McElroy Coal Company v. Schoene

Supreme Court of West Virginia

April 12, 2018

MCELROY COAL COMPANY, Petitioner
v.
MICHAEL SCHOENE AND PATRICIA SCHOENE, Respondents

          Submitted: January 16, 2018

          Rodger L. Puz, Esq. J.R. Hall, Esq. Dickie McCamey & Chilcote, P.C. Pittsburgh, Pennsylvania Counsel for Petitioner

          James G. Bordas, Jr., Esq. Jeremy M. McGraw, Esq. James B. Stoneking, Esq. Bordas & Bordas, PLLC Wheeling, West Virginia Counsel for Respondents

          J. Thomas Lane, Esq. Carrie J. Lilly, Esq. Bowles Rice LLP Charleston, West Virginia Counsel for Amicus Curiae The West Virginia Coal Association

          JUSTICE WALKER concurs in part, dissents in part, and reserves the right to file a separate opinion.

         SYLLABUS BY THE COURT

         1. "A landowner who conveys the coal underlying the surface of his land has an absolute property right to subjacent support for the surface in its natural state and, though he may sell or dispose of such right, he will not be deemed to have conveyed, parted with, or extinguished it unless his intention so to do clearly appears from express language or by necessary implication." Syl. Pt. 1, Winnings v. Wilpen Coal Co., 134 W.Va. 387, 59 S.E.2d 655 (1950).

         2. "Under the West Virginia common law of property, the well recognized and firmly established rule is that when a landowner has conveyed the minerals underlying the surface of the land, he retains the right to the support of the surface in its natural state, but the owner of land may release or waive his property right of subjacent support by the use of language that clearly shows that he intends to do so[.]" Syllabus, in part, Rose v. Oneida Coal Co., Inc., 180 W.Va. 182, 375 S.E.2d 814 (1988).

         3. "Deeds are subject to the principles of interpretation and construction that govern contracts generally." Syl. Pt. 3, Faith United Methodist Church v. Morgan, 231 W.Va. 423, 745 S.E.2d 461 (2013).

         4. "A valid written instrument which expresses the intent of the parties in plain and unambiguous language is not subject to judicial construction or interpretation but will be applied and enforced according to such intent." Syl. Pt. 1, Cotiga Dev. Co. v. United Fuel Gas Co., 147 W.Va. 484, 128 S.E.2d 626 (1962).

         5. "It is not the right or province of a court to alter, pervert or destroy the clear meaning and intent of the parties as expressed in unambiguous language in their written contract or to make a new or different contract for them." Syl. Pt. 3, Cotiga Dev. Co. v. United Fuel Gas Co., 147 W.Va. 484, 128 S.E.2d 626 (1962).

         6. "Extrinsic evidence will not be admitted to explain or alter the terms of a written contract which is clear and unambiguous." Syl. Pt. 9, Paxton v. Benedum-Trees Oil Co., 80 W.Va. 187, 94 S.E. 472 (1917).

         7. "Where a deed conveys the surface of a tract of land, reserving the coal and the right to mine and ship all of the coal, the surface is divested of its inherent right of support from the coal." Syl. Pt. 2, Simmers v. Star Coal & Coke Co., 113 W.Va. 309, 167 S.E. 737 (1933).

         8. "Where a deed conveys the coal under a tract of land, together with all the rights and privileges necessary and useful in the mining and removal of said coal, including the right of mining the same with or without leaving any support for the overlying strata, and without liability for any injury which may result to such overlying strata or to the surface, or to water courses or roads or ways by reason of the mining and removal of said coal, the grantee is not liable for damages to the surface or to structures upon the surface, which damages result from surface subsidence proximately resulting from the mining and removal of such coal." Syllabus, Stamp v. Windsor Power House Coal Co., 154 W.Va. 578, 177 S.E.2d 146 (1970).

         9. "The definitions of 'surface mine, ' 'surface mining, ' or 'surface-mining operations' contained within the West Virginia Surface Coal Mining and Reclamation Act, W.Va. Code § 22-3-1, et seq., include 'surface impacts incident to an underground coal mine, ' and areas 'where such activities disturb the natural land surface.'" Syl. Pt. 4, Antco, Inc. v. Dodge Fuel Corp., 209 W.Va. 644, 550 S.E.2d 622 (2001).

         10. "Pursuant to the West Virginia Surface Coal Mining and Reclamation Act, W.Va. Code, 22A-3-14 (1985) [now W.Va. Code, 22-3-14 (1994)], and 30 U.S.C. § 1266 (1977) of the federal Surface Mining Control and Reclamation Act and their accompanying regulations, the operator of an underground mine is required to correct any material damage resulting from subsidence caused to surface lands, to the extent technologically and economically feasible by restoring the land to a condition capable of maintaining the value and reasonable foreseeable uses which it was capable of supporting before subsidence." Syl. Pt. 4, Rose v. Oneida Coal Co., Inc., 195 W.Va. 726');">195 W.Va. 726, 466 S.E.2d 794 (1995).

         11. "A regulation that is proposed by an agency and approved by the Legislature is a 'legislative rule' as defined by the State Administrative Procedures Act, W.Va. Code, 29A-1-2(d) [1982], and such a legislative rule has the force and effect of law." Syl. Pt. 5, Smith v. W.Va. Human Rights Comm'n, 216 W.Va. 2, 602 S.E.2d 445 (2004).

         12. "The West Virginia Surface Coal Mining and Reclamation Act allows for a private cause of action: 'Any person or property who is injured through the violation by any operator of any rule, order or permit issued pursuant to this article may bring an action for damages, including reasonable attorney and expert witness fees, in any court of competent jurisdiction. . . .' W.Va. Code § 22-3-25(f) (1994)." Syl. Pt. 5, Antco, Inc. v. Dodge Fuel Corp., 209 W.Va. 644, 550 S.E.2d 622 (2001).

         13. A surface owner may commence a civil action against a coal operator pursuant to West Virginia Code § 22-3-25(f) (1994) alleging that injury to the surface owner's person or property was caused through the coal operator's violation of a rule, order, or permit issued under the West Virginia Coal Mining and Reclamation Act [West Virginia Code §§ 22-3-1 to 22-3-38]. If the surface owner proves a violation and that the violation caused the alleged injury, the surface owner may recover monetary damages including, but not limited to, damages for annoyance and inconvenience resulting from the violation. In the event the surface owner is unable to prove that the coal operator violated such rule, order, or permit, or proves the violation but fails to prove that the violation caused the alleged injury, then the surface owner's remedies for subsidence damage caused by a coal operator are those provided in the West Virginia Code of State Rules §§ 38-2-16.2.c to 38-2-16.2.c.2.

         14. "The primary object in construing a statute is to ascertain and give effect to the intent of the Legislature." Syl. Pt. 1, Smith v. State Workmen's Comp. Comm'r, 159 W.Va. 108, 219 S.E.2d 361 (1975).

         15. "Where the language of a statute is clear and without ambiguity the plain meaning is to be accepted without resorting to the rules of interpretation." Syl. Pt. 2, State v. Elder, 152 W.Va. 571, 165 S.E.2d 108 (1968).

         16. "Undefined words and terms used in a legislative enactment will be given their common, ordinary and accepted meaning." Syl. Pt. 6, in part, State ex rel. Cohen v. Manchin, 175 W.Va. 525, 336 S.E.2d 171 (1984).

         17. "Statutes which are remedial in their very nature should be liberally construed to effectuate their purpose." Syl. Pt. 6, Vest v. Cobb, 138 W.Va. 660, 76 S.E.2d 885 (1953).

         18. "The West Virginia Surface Coal Mining and Reclamation Act, W.Va. Code § 22-3-1, et seq., is remedial legislation that has as one of its primary purposes the protection of the public from the potentially destructive effects that mining may have on our lands, forests and waters." Syl. Pt. 3, Antco, Inc. v. Dodge Fuel Corp., 209 W.Va. 644, 550 S.E.2d 622 (2001).

         19. "Annoyance and inconvenience can be considered as elements of proof in measuring damages for loss of use of real property." Syl. Pt. 3, Jarrett v. Harper & Son, Inc., 160 W.Va. 399, 235 S.E.2d 362 (1977), modified on other grounds by Brooks v. City of Huntington, 234 W.Va. 607, 768 S.E.2d 97 (2014).

         20. The West Virginia Code of State Rules §§ 38-2-16.2.c. to 38-2-16.2.c.2, which were promulgated pursuant to the West Virginia Surface Coal Mining and Reclamation Act [West Virginia Code §§ 22-3-1 to 22-3-38], provide that when a coal operator causes subsidence damage to structures or facilities, the operator is required to either correct the material damage caused to any structures or facilities by repairing the damage or compensate the owner of such structures or facilities in the full amount of the diminution in value resulting from the subsidence. The owner of the damaged structures or facilities shall choose between the two remedies.

          OPINION

          LOUGHRY, JUSTICE

         This matter is before the Court upon a July 18, 2017, order of the United States Court of Appeals for the Fourth Circuit certifying the following four questions to this Court:

(1) Under West Virginia law, does a deed provision (1902) transferring the right to mine coal "without leaving any support for the overlying strata and without liability for any injury which may result to the surface from the breaking of said strata, " prohibit a surface estate owner from pursuing a common law claim for loss of support arising from subsidence caused by the extraction of coal from below the surface?
(2) Assuming the surface lands and residence of a landowner have been materially damaged from subsidence, does the West Virginia Surface Coal Mining and Reclamation Act, W.Va. Code § 22-3-1 et seq., (the "Act") authorize an action against the coal mine operator for the damage so arising; or, are landowners only permitted to seek injunctive relief compelling compliance with the Act's provisions? Compare W.Va. Code § 22-3-25(a), with id. § 22-3-25(f)?
(3) (a) If the Act permits a suit for damages, what is the proper measure of damages? Specifically, is a landowner permitted to recover only the diminution in value to the property arising from the subsidence, or can the property owner alternatively recover damages in an amount equal to the cost to repair the property?
(b) Additionally, if the Act permits a suit for damages, can those damages include compensation for "annoyance, inconvenience, aggravation and/or loss of use"?
(4) Lastly, the regulations issued under the Act provide that when a coal mine operator causes subsidence damage to the "structures or facilities, " the operator must either correct it or "compensate the owner . . . in the full amount of the dimunition in value" as a result of the mining. See W.Va. Code R. § 38-2-16.2.c.2; see also id. § 38-2-16.2.c.1. The regulations, however, do not designate which party gets to make this election between remedies if the parties fail to reach an agreement. Between the landowner and the coal mine operator, who elects the appropriate remedy and what standards govern that decision?

         By order dated August 30, 2017, this Court accepted the certified questions and docketed the matter for resolution. Upon review of the parties' briefs, arguments, and the appendix record, we answer the certified questions.[1]

         I. Factual and Procedural Background

         The respondents, Michael and Patricia Schoene, own the surface to approximately fifty-five acres of land in Marshall County on which sits their residence. The petitioner, McElroy Coal Company ("McElroy"), owns and/or leases the coal beneath the surface. In a 1902 deed, the Schoenes' predecessors-in-interest severed the coal and conveyed it with the express waiver of the right to recover any common law damages resulting from the loss of subjacent support. The waiver clause provides:

Together with all the rights and privileges necessary and useful in the mining and removing of the said coal, including the right of mining the same without leaving any support for the overlying stratas [sic] and without liability for any injury which may result to the surface from the breaking of said strata[.]

         In 2012, McElroy mined coal under the Schoenes' property using the longwall mining method. This activity caused subsidence to the Schoenes' surface estate, including damage to their residence. As a result, the Schoenes filed an action against McElroy in the Circuit Court of Marshall County. McElroy removed the action to the United States District Court for the Northern District of West Virginia under diversity jurisdiction.

         The Schoenes subsequently amended their complaint to add statutory claims under, inter alia, the West Virginia Surface Coal Mining and Reclamation Act, West Virginia Code §§ 22-3-1 to 22-3-38 ("the Coal Mining Act" or "the Act"). These statutory claims alleged that the subsidence arising from McElroy's mining activities caused material damage to the Schoenes' surface estate and residence, and that McElroy had neither corrected nor paid for the damage. The Schoenes also sought to recover damages for their inconvenience and emotional and mental anguish, stress, and anxiety.

         McElroy moved for partial summary judgment, alleging that the waiver clause in the 1902 deed precluded relief on the Schoenes' common law claim and that the the Act did not authorize all of the relief the Schoenes sought in their statutory claim. The Schoenes conceded the waiver issue. Specifically, the Schoenes indicated in their response to McElroy's motion for summary judgment:

The [Schoenes] agree, after additional discovery, research and consideration, that the matters for resolution in this case are much more limited than those originally pled in their Complaint and Amended Complaint. The [Schoenes] now agree, and do not dispute, that there is a waiver of subjacent support included within the title chain to their property. The [Schoenes], therefore, acknowledge and agree that they cannot pursue traditional common law property damage claims related to the mining operations conducted under their property. The [Schoenes] therefore agree that Count 1 of their complaint would not be [a] viable claim for trial purposes in this matter.

         The federal district court disregarded the Schoenes' concession and denied McElroy's motion for summary judgment on the Schoenes' common law claim.

         The case proceeded to trial during which both parties adduced evidence regarding the cost to repair the damage to the Schoenes' residence and land. The jury awarded the Schoenes $547, 000, which sum includes $350, 000 for repair to their residence, $172, 000 for repair to the land, and $25, 000 for the Schoenes' annoyance, inconvenience, aggravation, and/or loss of use. McElroy appealed that decision to the United States Court of Appeals for the Fourth Circuit, which certified the questions set forth above.

         II. Standard of Review

         We have consistently held that "[a] de novo standard is applied by this Court in addressing the legal issues presented by a certified question from a federal district or appellate court." Syl. Pt. 1, Light v. Allstate Ins. Co., 203 W.Va. 27, 506 S.E.2d 64 (1998). With this standard to guide us, we proceed to consider the certified questions.

         III. Discussion

         A. Waiver of Subjacent Support

         The first certified question is:

Under West Virginia law, does a deed provision (1902) transferring the right to mine coal "without leaving any support for the overlying strata and without liability for any injury which may result to the surface from the breaking of said strata" prohibit a surface estate owner from pursuing a common law claim for loss of support arising from subsidence caused by the extraction of coal from below the surface?

         Under our law, generally, an owner of the surface estate has a right to subjacent support. This Court held in syllabus point one of Winnings v. Wilpen Coal Co., 134 W.Va. 387, 59 S.E.2d 655 (1950), as follows:

A landowner who conveys the coal underlying the surface of his land has an absolute property right to subjacent support for the surface in its natural state and, though he may sell or dispose of such right, he will not be deemed to have conveyed, parted with, or extinguished it unless his intention so to do clearly appears from express language or by necessary implication.

         We subsequently made clear, however, that the right to subjacent support can be waived.

Under the West Virginia common law of property, the well recognized and firmly established rule is that when a landowner has conveyed the minerals underlying the surface of his land, he retains the right to the support of the surface in its natural state, but the owner of land may release or waive his property right of subjacent support by the use of language that clearly shows that he intends to do so[.]

         Syllabus, in part, Rose v. Oneida Coal Co., Inc. (Rose I), 180 W.Va. 182, 375 S.E.2d 814 (1988).

         We first address whether the subject waiver in the 1902 deed unambiguously waives the surface owners' right to subjacent support. McElroy posits that the waiver clause is express and unambiguous; consequently, it should be applied and not interpreted. The Schoenes, directly contrary to their position before the district court, now assert that the deed is ambiguous. According to the Schoenes, the granting of mining rights in the deed includes only those mining rights and privileges that are "necessary and useful." ...


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