Arnold v. Cramer , 1909 Pa. Super. LEXIS 2 ( 1909 )

Opinion by

Henderson, J.,

If we concede that there was jurisdiction in equity to entertain the complainant’s bill we are met by the objection that the contract of June 8, 1888, which the complainants seek to have canceled, transfers a half interest in the coal underlying the land described to Walter M. Leek, the second party. The language used is “Doth by these presents let,” but the technical words “grant, bargain and sell” or their equivalent are not necessary to pass the title to coal in place if from the language of the whole instrument the intention to sell is apparent. Numerous cases hold that an instrument which is in terms a lease or demise of all the coal in a tract of land with a right to mine and take away the same is a sale of the coal.in place: Hope’s Appeal, 29 W. N. C. 365; Montooth v. Gamble, 123 Pa. 240; R. R. Co. v. Sanderson, 109 Pa. 583; Lazarus’s Estate, 145 Pa. 1; Timlin v. Brown, 158 Pa. 606; Coolbaugh v. Lehigh & Wilkes-Barre Coal Co., 213 Pa. 28; Hosack v. Crill, 18 Pa. Superior Ct. 90. Whether the instrument be called a lease or deed all of its provisions must be taken into consideration to ascertain the intent of the parties. If from that consideration the intention of the parties is found to have been to make a sale, their contract will be so interpreted. And where this intention is clear the construction of the instrument is not affected by the fact that compensation is stipulated for a fixed price per ton or at a gross sum for the whole price, nor that the compensation is called rent or royalty. Examination of the agreement referred to satisfies us that the parties intended a sale of the coal. It disposes of all of the first party’s interest for the period of “ninety-nine years next ensuing and from year to year thereafter.” It further provides, “This lease expires when coal is exhausted.” The second party covenanted to pay to the first party or his assigns the sum of twelve and one-half cents per ton on all coal mined and sold from said land, of grades coarser than that known as “buckwheat coal” and agreed to commence selling coal within six months from the date of the agreement. It was stipulated that royalty be due and payable at the termination of each three months for the amount mined and sold during the said three months, allowing ten days’ grace for fixing amount and results. The agreement bound the parties, their heirs and assigns, and was under seal. There was, therefore, a grant of the coal and an agreement to pay therefor at a price fixed, times stated at which payment should be made and an agreement that the title should continue in the second party as long as the coal lasted. It is argued that this agreement is distinguishable from any of those contained in the cases cited in that the contract contains no engagement to take or sell more than the quantity which it might be necessary to mine in order to “commence selling within six months,” and that having commenced selling within that time the second party was at liberty to throw up the enterprise at any time thereafter. But we do not so interpret the contract. It was undoubtedly the intention of the parties that the mine should be worked with reasonable diligence and that the output should bear a relation proportionate to the capacity of the mine and the state of the market. The spirit of the agreement implies this, and that much the grantors could insist upon. Where the consideration for the agreement is to be determined by the output of the mine the law implies a covenant on the part of the grantee that he will prosecute the work with reasonable diligence, so that the grantor may receive the compensation which was in view when the agreement was made: Watson v. O'Hern, 6 Watts, 362; Lyon v. Miller, 24 Pa. 392; Koch’s Appeal, 93 Pa. 434. That the grantor did not protect himself by requirement for a minimum production from the mine does not change the character of the instrument. There is no clause of forfeiture nor any provision for a reversion as to any part of the coal, but the grantor was not without remedy on his contract. Such being the nature of the interest held by the appellees the doctrine of abandonment does pot apply. They held a complete title to the half interest in the coal, and abandonment only takes place in case of imperfect title: Bear Valley Coal Co. v. Dewart, 95 Pa. 72; Putnam v. Tyler, 117 Pa. 570. Abandonment as to a perfect title could only be affirmed on a state of facts sufficient to raise an estoppel or where possession has been acquired and held under a claim of title by limitation. If, however, the case turned on the question of abandonment we find no reason for criticising the conclusion of the learned judge of the court below. Neither the defendants nor those under whom they hold ever acknowledged an abandonment, and their conduct in making and receiving conveyances is inconsistent with an intention to abandon. The destruction of the breaker by fire suspended mining operations, but a large expense was involved in the reconstruction of the plant, and this fact or the state of the market and the expense of operating the mine may have been an excuse for delay. The owner of the half of the mine in which the plaintiffs had no interest was losing any profit which might have been derived by operating the property equally with the plaintiffs and had the same motive for activity in prosecuting the business which they had. We cannot say that the delay is sufficient evidence of abandonment to overcome the terms of an express covenant. The letters written by Crawford and Leek to Arnold in 1899 show a desire to lease or otherwise dispose of the property, but they are not inconsistent with the position taken by the defendants. The property was idle and a large expenditure would be necessary to put it into working order, and all concerned were interested- in realizing in some form on the investment. Whatever Crawford and Leek may have understood their obligation to be under the contract the correspondence does not clearly show that they recognized that their rights were forfeited. Both in July, 1899, the year in which the letters from Leek and Crawford were written, and in February, 1902, the defendants were asserting the existence of the lease as shown by the deed from Leek to Cramer and Cure and by the lease from Crawford to Cramer and Cure. The heirs of Arnold did not attempt to take possession of the premises or exercise any ownership over it during the time the mine was not in operation, and the evidence does not disclose a state of facts from which it can be satisfactorily concluded that there was a surrender of the interest. Abandonment is ordinarily a question of intention. There must be an intention to abandon as well as an actual abandonment of property, and where the character of the transaction depends on the intent of the party it is competent for him to testify what his intention was: Juniata Building & Loan Association v. Hetzel, 103 Pa. 507. This rule was applied in Bartley v. Phillips, 179 Pa. 175, where the lessee of the owner was permitted to prove that in removing certain materials from the land they had no intention to abandon the lease. We are not persuaded that an error was committed in the decree entered in this case. It is, therefore, affirmed.