Rausch Creek Land, LP v. Porter Associates, Inc.

J. A03034/15
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
RAUSCH CREEK LAND, L.P., : IN THE SUPERIOR COURT OF
SUCCESSOR IN INTEREST TO KOCHER : PENNSYLVANIA
COAL COMPANY, :
:
Appellant :
:
v. :
:
PORTER ASSOCIATES, INC., :
:
Appellee : No. 1078 MDA 2014
Appeal from the Order Entered May 27, 2014
In the Court of Common Pleas of Schuylkill County
Civil Division No(s).: S-1721-2010
BEFORE: MUNDY, STABILE, and FITZGERALD,* JJ.
MEMORANDUM BY FITZGERALD, J.: FILED MAY 08, 2015
Appellant, Rausch Creek Land, L.P., successor in interest to Kocher
Coal Company, appeals from the order dismissing its complaint for injunctive
relief against Appellee, Porter Associates, Inc. Appellant contends the trial
court erred by identifying an ambiguity in a lease, holding an agreement
existed and that Mr. Steve Shrawder was an officer who could legally bind
Appellant, concluding that the entire parcel of land at issue could be used for
ash disposal, and ruling that Mr. Terry Schmidt’s testimony was not relevant.
We affirm.
*
Former Justice specially assigned to the Superior Court.
J. A03034/15
We adopt the facts and procedural history set forth by the trial court.
See Trial Ct. Op., 5/27/14, at 1-15.1 After a bench trial, the court dismissed
Appellant’s complaint for injunctive relief on May 27, 2014. Order, 5/27/14.2
Appellant timely appealed and timely filed a court-ordered Pa.R.A.P. 1925(b)
statement.
Appellant raises the following issues:
Whether the court erred as a matter of law by determining
that an ambiguity existed in paragraph 7 of the lease
regarding [Appellant’s] exclusive reservation of the right to
place only coal refuse in the Primrose Pit.
Whether the court erred as a matter of law by determining
that an agreement existed as to the Exhibit A map being
the metes and bounds description.
Whether the court erred as a matter of law by determining
that Steve Shrawder was an officer with authority to
legally bind [Appellant], specifically with regard to the
effect of Mr. Shrawder’s discussions and negotiation of the
terms of the lease and placing his initials on the metes and
bounds description.
Whether the court erred as a matter of law in determining
that the 800 acre parcel was properly permitted for ash
disposal.
1
We note the docket does not reflect whether the court complied with
Pa.R.C.P. 236(b), which states the prothonotary “shall note in the docket the
giving of the notice” required by Pa.R.C.P. 236(a).
2
We construe this as an order resolving a request for injunctive relief, which
is entitled to an interlocutory appeal as of right. See Pa.R.A.P. 311(a)(4).
We acknowledge that an order dismissing a complaint after a bench trial is
an atypical verdict.
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J. A03034/15
Whether the court erred as a matter of law in determining
that Terry Schmidt’s testimony was irrelevant regarding
the fact that [Appellee] has no legal obligation to reclaim
the Primrose Pit or any other abandoned strip mining pits
within the 115 acre permit area or outside the 115 acre
permit area.
Appellant’s Brief at 7.
In support of Appellant’s first issue, it argues that the trial court failed
to explain how paragraph seven was ambiguous. Appellant refers this Court
to the Surface Mining Permit (“SMP”), which purportedly states that the
Primrose Pit was to be reclaimed using coal refuse only. Appellant maintains
that the SMP, read in conjunction with the lease, precluded Appellee from
depositing ash in the Primrose Pit. Id. at 18. We hold Appellant is due no
relief.
The standard of review is an error of law:
[I]n order to establish a claim for a permanent injunction,
the party must establish his or her clear right to relief.
However, unlike a claim for a preliminary injunction, the
party need not establish either irreparable harm or
immediate relief and a court may issue a final injunction if
such relief is necessary to prevent a legal wrong for which
there is no adequate redress at law. Additionally, when
reviewing the grant or denial of a final or permanent
injunction, an appellate court’s review is limited to
determining whether the trial court committed an error of
law.
Buffalo Twp. v. Jones, 813 A.2d 659, 663-64 (quotation marks, citations,
and footnote omitted).
Instantly, Appellant has presented no legal authority whatsoever in
support of its argument. Appellant’s Brief at 14-19. Appellant, for example,
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J. A03034/15
does not explain how this Court may rely upon parol evidence to establish
that paragraph seven is not ambiguous. “It is the appellant who has the
burden of establishing his entitlement to relief by showing that the ruling of
the trial court is erroneous under the evidence or the law. Where the
appellant has failed to cite any authority in support of a contention, the
claim is waived.” Bunt v. Pension Mortg. Assocs., Inc., 666 A.2d 1091,
1095 (Pa. Super. 1995) (citations omitted); accord Korn v. Epstein, 727
A.2d 1130, 1135 (Pa. Super. 1999). Because Appellant has cited no legal
authority, it has waived this claim on appeal. See J.J. Deluca Co. v. Toll
Naval Assocs., 56 A.3d 402, 412 (Pa. Super. 2012).
For its second issue, Appellant refers this Court to testimony and
evidence supporting its contention that its “Exhibit A” is the true Exhibit A.
Appellant emphasizes that the record contradicts Appellee’s testimony that
Appellee’s “Exhibit A” is the actual Exhibit A. Appellant, however, “offers no
[legal] authority at all to support it. Accordingly, this claim is waived. See
Pa.R.A.P. 2119(a), (b).” J.J. Deluca Co., 56 A.3d at 412. Regardless, we
would have discerned no basis to reverse as the trial court heard conflicting
testimony and found Appellee’s witness more credible with respect to
identifying the actual “Exhibit A.” See Trial Ct. Op. at 17-18 (finding most
credible Mr. Shrawder’s testimony that metes and bounds description was
actual Exhibit A); Buffalo Twp., 813 A.2d at 663-64; see also In re
Zeedick’s Estate, 218 A.2d 755, 755 (Pa. 1966) (per curiam) (“[O]n
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J. A03034/15
appeal, it is not within our province to assess the credibility of the
testimony.”); Braun v. Wal-Mart Stores, Inc., 24 A.3d 875, 891 (Pa.
Super. 2011) (per curiam) (“Questions of credibility and conflicts in the
evidence are for the fact-finder to resolve and the reviewing court should not
reweigh the evidence.” (alteration and citation omitted)), affirmed, 106 A.3d
656 (Pa. 2014).
Appellant argues, in support of its third issue, that the court erred by
holding that Mr. Shrawder was an officer with authority to legally bind
Appellant. It references cross-examination testimony within which Mr.
Schrawder allegedly admitted he was not an officer. In support of its
argument, Appellant draws several factual conclusions from favorable
testimony. Appellant, however, similar to its argument for its first and
second issues, cited no legal authority whatsoever; accordingly, Appellant
has waived this claim on appeal. See J.J. Deluca Co., 56 A.3d at 412.
Moreover, Appellant failed to raise an appropriate objection before the trial
court and thus failed to preserve the issue for appellate review. See
generally Pa.R.A.P. 302.
For Appellant’s fourth issue, we reproduce the entirety of its argument
below:
The SMP clearly provides that the permit area is 115 acres.
The trial court had absolutely no basis to find that the SMP
included any area greater than the 115 acres addressed in
the SMP.
-5-
J. A03034/15
Appellant’s Brief at 28-29. Appellant’s skeletal argument, devoid of
authority and analysis results in waiver.3 See J.J. Deluca Co., 56 A.3d at
412.
In support of their last issue, Appellant similarly presents a one-
paragraph argument lacking any legal analysis or citation to authority. See
Appellant’s Brief at 29. We accordingly find Appellant waived this issue.4
See J.J. Deluca Co., 56 A.3d at 412. For these reasons, we affirm the
judgment below.
Judgment affirmed.
Judge Mundy joins the memorandum.
Judge Stabile concurs in the result.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 5/8/2015
3
We note that the trial court construed the contract and not the SMP. We
add that Appellee acknowledged that it is subject to Pennsylvania
Department of Environmental Protection regulations and other legal
requirements governing ash disposal. See Appellee’s Brief at 35.
4
Regardless, it is well-settled that questions of law are for the court to
resolve.
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COURT OF COMl'vION PLEAS OF SCHU r LKILL COUNTY
TWENTY-FIRST JUDICIAL DISTRICTOF PENNSYLVANIA
CIVIL DIVISION
RAUSCH CREEK LAND, LP., No. S-1721-2010
Successor in interest to
KOCHER COAL COMP ANY,
Plaintiff
V.
PORTER ASSOCIATES, INC.,
Defendant
Dirk Berger, Esquire and Charles B. Haws, Esquire- for the Plaintiff
Michael A O'Pake, Esquire - for the Defendant
ORDER OF COURT PURSUANT TO PA. R.A.P. N0.1925
MILLER, J.
AND NOW, this 3Qth day of July, 2014, it is hereby ORDERED that the
Prothonotary of Schuylkill County transmit the record papers of the within
proceeding along with the Order and Opinion filed May 27, 2014 to the Superior
Court of Pennsylvania.
BY THE COURT:
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MILLER,J. c:
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IN THE COURT OF COMMON PLEAS OF SCHUYLKILL COUNTY
TWENTY-FIRST JUDICIAL DISTRICT OF PENNSYLVANIA
CIVIL DIVISION
RAUSCH CREEK LAND, L.P., No. S-1721-2010
Successor in interest to
KOCHER COAL COMP ANY,
Plaintiff
V.
PORTER ASSOCIATES, INC.,
Defendant
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MILLER, J.
AND NOW, this J-.1 day of May, 2014, after trial, and in consideration of
the Proposed Findings of Fact, Conclusions of Law and Memoranda of Law submitted
by the parties, it is hereby ORDERED:
1. The Complaint filed by Plaintiff, Rausch Creek Land, L.P. successor in interest to
Kocher Coal Company is DISMISSED;
2. The Court finds that the metes and bounds description set forth in Defendant's
Exhibit 7 is the Exhibit "A" to the Lease Agreement entered into between Kocher
Coal Company and Porter Associates, Inc. on January 29, 1991; and,
3. Defendant, Porter Associates, Inc. can dispose of ash anywhere within the confines of
the above-referenced Exhibit "A", inclusive of the Holmes Pit and Primrose Pits
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subject to any bonding requirements of Pennsylvania Department ofEnviromnental
Resources.
BY THE COURT:
MILLER,J. ' .
2
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IN THE COURT OF COMMON PLEAS OF SCHUYLKILL COUNTY
TWENTY-FIRST JUDICIAL DISTRICT OF PENNSYLVANIA
CIVIL DIVISION
RAUSCH CREEK LAND, L.P., No. S-1721-2010
Successor in interest to
KOCHER COAL COMPANY,
Plaintiff
V.
PORTER ASSOCIATES, INC.,
Defendant
Dirk Berger, Esquire and Charles B. Haws, Esquire- for the Plaintiff
Michael A. O'Pake, Esquire - for the Defendant
OPINIONOF COURT
MILLER, J.
The matter before this Court is the Complaint for Preliminary /Permanent
Injunction filed on July 61 2010 by Plaintiff, Rausch Creek Land, L.P. ("RCL"),
successor in interest to Kocher Coal Company ("Kocher") against Defendant,
Porter Associates, Inc. ("Porter"). On August 4, 2010, RCL' s request for a
Preliminary Injunction to prohibit Porter from disposal of any ash on any portion
of the real property that is the subject of a Lease between Porter and Kocher
dated January 29, 1991, was denied. RCL' s request for a Permanent Injunction is
now before the Court. A trial on the merits regarding the Complaint for
Injunction was held on April 1, 2014, and concluded on April 2, 2014.
The dispute between RCL and Porter in the instant matter is the area
II
upon which Porter is authorized to dispose of ash pursuant to Exhibit A" of the
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Lease Agreement(" Lease"). RCL sets forth that 1t is a specific and lnmted area
shown on a map marked Plaintiff's Exhibit 3 as the "designated ash disposal
area". On the contrary, Porter maintains that it is any area, on the entire 800 acre
parcel where ash could be discarded. The 800 acre property was previously
owned by Kocher and is now owned by RCL and is described in metes and
bounds in Defendant's Exhibit No. 7.
Robert Rivkin ("Rivkin"), general partner of RCL testified concerning the
merits of the case. His understanding was that Kocher entered into a Consent
Order and Agreement ("COA") with the Department of Envirorunental
Resources ("DER") on January 19, 1990.; the COA required Kocher to a) reclaim
the Porter Stripping site, which had been mined by Kocher pursuant to an old
Mine Drainage Permit and b) obtain a new Surface Mining Permit ("SMP") for
the Porter Stripping site. Kocher obtained a new Surface Mining Permit for the
Porter Stripping site on June 25, 1990 and entered into a Lease with Porter on
January 29, 1991; also, Kocher agreed to transfer the SMP to Porter and Porter
agreed to accept the transfer of that permit and comply with the terms of the -
SMP and all applicable laws; Robert Rissinger (Rissinger) was the President of
Kocher at the time the Lease was executed; Rissinger sold his interest in Kocher
to the Lickman family in 1994; RCL acquired the assets of Kocher out of
bankruptcy in 2003.
Rivkin testified that paragraph 7 of the Lease addresses the issue of coal
refuse disposal. Paragraph 7 states:
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Lessor shall retam nght to deposit coal re[f]use m the
Holmes stripping and abandoned Primrose stripping as is
described in the SMP #54890105.
Rivkin claims that the language in paragraph 7 of the Lease is unambiguous; that
the SMP outlines the phases of the operation, specifically the Module 10
Operations Plan, Exhibit P.13 and as revised Exhibit P.14. Rivkin asserts that
these Exhibits establish that the Primrose Pit was to be reclaimed using coal
refuse as opposed to ash. This is set forth under the heading Phase 5 which
states:
This area consists of an abandoned pit that was believed to have
been mined in the early 1950's. After coal refuse areas within the
eastern Holmes pit and any required to fill Phase 2 are completed,
this pit will be filled with coal refuse in accordance with Module 11.
Rivkin then discussed Module 11, Exhibit P.15, noting the provision under the
heading Abandoned Primrose Pit as follows:
Coal refuse will be deposited in the abandoned Primrose Stripping
as noted on Exhibit P.11.1 and P.11.3. The floor of this abandoned
pit will be filled with at least ten feet of overburdened spoil before
the coal refuse is dumped, layered and compacted using end dump
trucks and a bulldozer or front end loader. Upon completion of the
fill, spoil material suitable of supporting vegetation shall be spread
over the surface and then seeded accordingly.
Rivkin references three Exhibits marked P.11.1, P.11.2 and P.11.3 noting that
P.11.1 and P.11.3 are mentioned in the provision for the Primrose Pit and Exhibit
P.11.3 shows the Primrose Pit whereby the bottom is shown filled with clean fill
and the remainder shown filled with coal refuse. Rivkin thus maintains that
there is no reference to any ash going into the pit.
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Rivkm testified that Module IO Plamtiff' s Exhibit 13 was revised on
4/30/90 and makes no reference to coal ash being deposited anywhere; also
Module 10 revised on 9/19/90, as shown in Plaintiff's Exhibit 14 contains
references to ash disposal but only in certain areas not including the Primrose
Pit; and Phase 2 references ash disposal to be used to help fill the Porter Pit but
there was no amendment to include ash in Phase 5 regarding the Abandoned
Primrose Pit.
Rivkin further testified that paragraph 7 of the Lease specifically reserved
for Kocher the Primrose Pit for refuse disposal as described in the SMP and that
Porter's assertion that it could seek to amend the SMP to place ash elsewhere is
incorrect. Rivkin further testified that the Lease specifically provides that Porter
was to accept a transfer of the SMP, and in accepting a transfer of the permit, is
bound by the terms of the SMP and that the clear terms of the SMP provided that
coal refuse was to be used to reclaim the Primrose Pit.
Rivkin also testified that Plaintiff's Exhibit 3 prepared by Ted Puschak,
engineer for Kocher Coal based on Module 9 operations map which was part of
the SMP, is the proper Exhibit" A "to the Lease. Rivkin claims that in reviewing
Kocher' s files located in the basement of the Kocher Coal Company office, he
found a file folder titled Porter Associates - Flyash Lease Original with map. In
this file was a Lease with ink signatures and corporate seals and the Exhibit "A"
map admitted into evidence as Plaintiff's Exhibit 3. Rivkin maintains that
Plaintiff's Exhibit 3 is Exhibit "A" to the Lease referenced on Plaintiff's Exhibit 2
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m the £1rst "Whereas" section. The end of the paragraph notes that "Lessee shall
have the exclusive rights to deposit ash and mine anthracite coal by surface
mining methods within designated areas of the demised premises such
_ designated areas being subject to approval of the Pa Department Of
Environmental Resources." Rivkin then offers that because the Exhibit" A" map
designates areas of the demised premises for ash disposal, specifically labelled
Designated Ash Disposal Area which area was addressed in the permit
· amendment that was pending at the time the Lease was executed, as presented in
the revised Module 10 and Module 25, the referenced permit amendment set out
the areas sought to receive approval from the Department for ash disposal.
He further asserts that the language in this paragraph does not mean that
Porter may designate any area it elects for ash disposal. He claims this
paragraph deals with the fact that the approval of the amendment to the SMP to
allow the disposal of ash was pending at the time the Lease was signed. Thus,
the amendment to the SMP authorized the disposal of ash in certain areas, more
specifically, the Porter Pit but not the Primrose Pit. Rivkin testified that the area
shown on Exhibit A" does not include the Primrose Pit and that specifically
fl
labeled on Exhibit "A" is the OLD ABANDONED PRIMROSE PIT FUTURE
REFUSE DISPOSAL AREA
Rivkin further notes that page 2 of the Lease describes the Fine Coal
and/ or Silt Storage Area on Exhibit A" which by definition would have to be a
fl
map not a metes and bounds description and that the Exhibit A" was clearly
fl
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1dentil1ed as a map m tfos Lease. Rivkm also notes Exhibit "A 1denhf1ed the
Primrose Pit and depicts that pit as being reserved for refuse disposal. On cross-
examination, Rivkin stated that the Lease Agreement was found in the Kocher
Coal Company office after he acquired the company but that he was not involved
with the company when the Lease was negotiated. He also admitted that during
the course of several law suits brought by RCL, many people had access to the
files and things were periodically added or removed from those files.
Porter disputes Rivkin' s contention that Plaintiff's Exhibit 3, that is the
map, is the correct Ex~bit "A" attachment to the Lease and to the contrary,
contends that Exhibit II A" is the metes and bounds description set forth in D-7.
On cross-examination, Rivkin's claims were challenged as speculative and faulty
for several reasons. First, there are no signatures on the map; secondly, that
Engineer Ted Puschak, former employee of Kocher Coal, testified the map
believed by Rivkin to be Exhibit II A" to the Lease was a permit map and was
nothing more than a working draft; third, the parties that negotiated the Lease,
Schrawder and Padinske, maintain that the intent of the Lease was to allow ash
to be disposed of anywhere there was a hole, void or crop fall on the 800 acres,
including the Holmes and Primrose Pits.
The second witness for RCL was engineer Terry Schmidt. Schmidt noted
that he was not involved in the negotiations of the Lease between Kocher and
Porter in 1990 and 1991 but that he reviewed the permit files in 2003. He also
noted that the Lease transferred the permit issued by Pa. Department of
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Environmental Protection (" DEP") from Kocher to Porter. When Schmidt was
questioned about the Consent of Landowner form he noted that it granted the
mine operator and DEP access but unequivocally stated that the Lease or Deed
between the landowner and mine operator controlled the agreement and intent
of the parties and does not convey any property rights.
Schmidt identified Module 10 and noted that the document dated April
30, 1990 did not authorize ash placement and that phase 5 was the area known as
the Primrose Pit and was an area delineated for coal refuse. He also identified
Module 11, a Coal Refuse Disposal form which under paragraph 11.2 showed
areas for coal refuse; which is a later Module 10. He also noted that the
Operational Information Form included flyash/bottom ash disposal, but phase 5
just referenced coal refuse; that Module 11 Coal Refuse Disposal Form dated
May 9, 1990 in paragraph 11.2 identified three areas for coal refuse disposal and
that the attached exhibits identified that breaker rock is to be disposed of in the
Primrose Pit, the Holmes Pit and the Porter stripping. Finally, he noted there are
no current reclamation requirements for the Primrose Pit and RCL has no
obligation to fill it. Porter argues and we agree that the testimony of Schmidt is
wholly irrelevant to the issue presented. Schmidt testified as to various phases of
the mining operation documents as it states to DEP permits, Consent of
Landowner forms and mining and reclamation activity but he had no direct
involvement in the preparation or signing of the Lease.
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Porter, mter aha, presented witness, Steve Shrawder, who was employed
by Kocher Coal Company from 1975 to 2000, and was the assistant to the
President during the majority of that time; Shrawder was familiar with DEP and
MSHA and is the son-in-law of former President and owner of Kocher Coal from
1975-1994. He left when the business operations were purchased by Ronald
Lickman.
Shrawder testified that Kocher operated a mining operation, including
deep mining, surface mining and coal preparation. He testified that on or about
January 19, 1990, Kocher entered into a COA with DEP with regard to its 800 acre
parcel of property in Porter Township, Schuylkill County, Pennsylvania;
Shrawder testified that a COA is an agreement between an operator and DEP
that is used when the operator has not fulfilled its obligations to DEP. Shrawder
testified that the COA between Kocher and DEP was for Kocher to begin
reclaiming the permitted stripping pits on Kocher's property; Shrawder testified
that in order to fulfill Kocher' s obligations under the COA, he began negotiations
with Padinske in order for Padinske to dispose of ash in the abandoned stripping
pits. Shrawder testified that he was primarily responsible for the negotiations of
the Lease that was eventually entered into by Kocher and Porter dated January
29, 1991. Shrawder testified that it was he and Padinske that negotiated the
terms of the Lease but that it really was more of a designing of the Lease than a
negotiation.
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Shrawder further testified that the d1scuss10ns he had with Padinske were
held because Kocher needed Porter's ash to fulfill its obligations under the COA;
Shrawder testified that the Lease was designed by he and Padinske for Porter to
place ash anywhere on the 800 acre site it wanted to, including the Holmes and
Primrose Pits. In fact, Shrawder testified that it was essential to fill all of the
abandoned stripping pits with ash as a means to bring water to the surface area
and prevent it from going into the Porter Tunnel or other tunnels underneath the
site. Filling of all of the pits would prevent acid mine discharge and make it
easier to direct the flow of water on the surface. He noted that filling of the old
abandoned stripping pits would also prevent accidents such as those which had
occurred on site by all-terrain vehicles; Shrawder was shown Plaintiff's Exhibit 3,
which is the map RCL contends is the Exhibit" A" to the Lease. Shrawder denied
that the map was the true Exhibit "A" to the Lease. He was specifically asked if
the "designated ash disposal area" on that map was the only area for which
Porter was permitted to dispose of ash pursuant to the Lease. Again, Shrawder
denied that there was a limited area on which Porter could dispose of the ash.
Shrawder testified that the entire 800 acre parcel of land was available for
Porter to dispose of ash; Shrawder testified that Porter was expected to start its
ash disposal in the "designated ash disposal area" indicated on Exhibit "A" due
to the fact that that was the only area permitted and bonded at the inception of
the Lease. Shrawder explained that it was standard in the mining industry and
in the reclaiming of abandoned stripping pits that an operator mines or reclaims
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in a certain area and when the mining is completed or the area reclaimed, the
bond for that area is released or shifted to another area which is then mined and
or reclaimed. The entire 800 acre parcel of property was properly permitted,
however, the area identified as the "designated ash disposal area" was the only
area bonded at the inception of the Lease. Later, other areas within the permitted
area were bonded by Porter and ash disposal occurred in those areas, specifically
the Holmes Pit to which Shrawder testified was reclaimed with flyash and coal
refuse;
Shrawder further testified as to his familiarity with paragraph 7 of the
Lease Agreement which RCL contends is an exclusive rights reservation for coal
refuse to the exclusion of ash placement by Porter. Shrawder testified that
Kocher needed somewhere to put its breaker rock from present production of its
breaker due to new DEP requirements requiring that presently produced breaker
rock needed to be removed from the surface and placed in old abandoned
stripping pits; the Holmes Pit and Primrose Pit were singled out by he and
Padinske as an accommodation made by Porter for Kocher; Shrawder noted that
the Primrose Pit and Holmes Pit were closer to the Kocher breaker and it simply
made good business sense to place the breaker rock in either of those pits. In
addition, the Holmes and Primrose Pits were going to be bonded by Porter,
obviating the need for Kocher to post any bonds for those pits.
Shrawder testified that Kocher was experiencing severe financial
difficulties and it did not have the means to post the appropriate bonds.
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Addlhonally, Kocher did not have the manpower necessary to truck the breaker
rock from the breaker to the Lincoln Pit or any other area other than the Holmes
or Primrose Pits; Shrawder was clear that the Markson Material that Rivkin
claims in his testimony that RCL wished to dispose of in the Primrose Pit, was
not what was contemplated by the parties in 1991 when the Lease was entered
into. In fact, he testified that the Markson Material did not even belong to
Kocher at that time so there would be no way that it could be contemplated to be
disposed of in the Primrose Pit; Shrawder also testified that the reservation for
breaker rock in the Holmes and Primrose Pits was not exclusive to the rights of
Porter and was not only a reservation for Kocher, but that other companies were
permitted to dispose of breaker rock in either of those pits as well; Shrawder
testified that the intent of the parties at the time the Lease was entered into was
that both ash and breaker rock would be placed in the Holmes and Primrose Pits.
Shrawder was shown a copy of the metes and bounds description marked
as Defendant's Exhibit 7 which Porter contends is the Exhibit ff Aff to the Lease
Agreement. Shrawder testified that the metes and bounds description is the
Exhibit ff A" which was attached to the Lease; Shrawder testified that the metes
and bounds description encompasses the entire area owned by Kocher, except
for a 100 foot boundary within the southern boundary line of Kocher' s property;
on cross examination, Shrawder was shown Module 10 and questioned
regarding phase 5 which indicates that it will be filled with coal refuse.
Shrawder testified that although he was not sure what the permit and the
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modules had md1cated, he was certam that the mtent of the Lease Agreement
between Kocher and Porter was for Porter to place ash anywhere on the 800 acre
parcel of property owned by Kocher and not limited to the designated area as
contended by RCL.
The second witness called by Porter was Michael Menghini, employed by
DEP as a District Mine Manager since September, 2010, Assistant Bureau
Director for District mining Operations since June, 2013 and a Mine Inspector
Supervisor since 1990. Menghini testified he was employed by DEP at the time
the COA was entered into between Kocher and DEP, he was knowledgeable
about the need for Kocher to reclaim the old abandoned stripping pits on its
property at the time COA was entered into and that he was involved in bringing
Kocher and Porter together so that Porter could dispose of ash at the Kocher site
in order for Kocher to fulfil its obligations under the COA.
Menghini testified that the clear intent of DEP, Kocher and Porter was for
Porter to place ash anywhere on Kocher' s site so as to fulfill the reclamation
obligations. Menghini testified that the intent was for Porter to begin ash
disposal in what was referred to as the Porter Stripping and that once that
reclamation obligation was competed, Porter would move to other areas on
Kocher's property, including the Holmes and Primrose Pits, for the disposal of
ash. Menghini testified that he and DEP were well aware that the Holmes and
Primrose Pits were to be filled with ash and that the Holmes Pit was in fact filled
with ash with the knowledge and consent of DEP. Menghini also testified that
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mming reclamation plans are continually updated, that RCL has made numerous
changes to its mining plans over the years and Porter has that same right.
The last witness called by Porter was Edward Padinske a shareholder of
Porter. The other shareholder of Porter being Joseph Frank, Sr. Padinske testified
that Porter was formed for the specific purpose of disposing of ash on the Kocher
site. Padinske testified that he was well aware of the COA entered into between
Kocher and DEP, that he was approached by DEP and Kocher to fulfill the
reclamation obligations of Kocher pursuant to that COA and that his intent was
to do so with ash. Padinske testified that he was the individual on behalf of
Porter that designed the Lease with Shrawder from Kocher.
Padinske testified that the specific negotiations he had with Shrawder
from Kocher was that the entire 800 acre parcel of property owned by Kocher
would be available for Porter to dispose of ash. Padinske testified that due to the
entire 800 acre parcel of property being available to Porter for ash disposal, a
long term Lease was required. Padinske testified that initially a thirty (30) year
Lease was contemplated but it was subsequently reduced to a twenty-seven (27)
year Lease. Padinske also confirmed that Kocher' s attorney, Allen Schaeffer,
drafted the Lease after Padinske and Shrawder discussed its terms.
Padinske further testified that the entire area of the property owned by
Kocher needed to be available for Porter's ash disposal due to the fact that ash
disposal as a beneficial use for reclamation was a relatively new concept at that
time and that there was a possibility that the ash from different sources would
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need to be segregated for potential hab1hty purposes. Padinske testified that it
was ultimately determined that the ash need not be segregated by source,
nevertheless, at the time the Lease was entered into between Kocher and Porter,
numerous places to dump ash on the site may have been needed.
Padinske testified that shortly after the Lease was fully executed, the
Exhibit "A" metes and bounds description was prepared by Puschak, and
Exhibit "A" was copied and maintained in Porter's files. Said document was
marked as Defendant's Exhibit 4 and included the handwritten metes and
bounds description as prepared by Puschak.
Next, Padinske testified that in Defendant's Exhibit 5, Puschak inserted
the words "more or less" on the document and as set forth in Defendant's Exhibit
5. Padinske testified that instead of retyping that entire document, because
computers were not used at that time, he maintained a copy of that document
but did not use it for any other purpose. Padinski then testified that he took the
Exhibit" A", without the words "more or less", to Kocher's offices and had
Shrawder place his initials on the Exhibit "A" so as to confirm that any area of
the 800 acres of Kocher' s property could be used for ash disposal by Porter.
Padinske copied the Exhibit "A" with just Shrawder' s initials on it and
maintained a copy in Porter's files. That copy was marked as Defendant's Exhibit
6. Padinske further testified that he took that document with only Shrawder's
initials on it, to the office of Joseph Frank, Sr. and obtained Frank's initials on
Exhibit "A". The document with Shrawder' s and Frank's initials on it was
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marked as Defendant's Exhibit 7 and that is the document that was attached to
the Lease as Exhibit II A".
DISCUSSION
RCL asserts that Porter does not have the right to dispose of ash in the
Primrose Pit as set forth in paragraph 7, of the Lease which reserves to Kocher
the right to dispose of coal refuse in the Hornes and Primrose Pits. RCL further
alleges that Porter is only able to dispose of ash in the II disposal area" designated
on RCL' s Exhibit 3. The Lease between Porter and Kocher, now RCL, was
entered into on January 29, 1991. RCL acquired the company in 2003 and was
bound by the terms of the Lease.
If a person grants a portion of his property to another and the grant is
susceptible of more than one interpretation, the words of the grant are to be
construed most strongly against the grantor and more favorably to the grantee.
Cites Service Oil Co. v. Haller, 393 Pa. 26, 142 A.2d 13, unless, of course, the
grantee drafted the grant and was therefore responsible for the ambiguity.
Similarly, if a grant reserves something to the grantor, the reservation is
construed more favorably to the grantee. Klaer v. Ridgway, 86 Pa. 529 (1878).
The Lease is a contract which must be interpreted according to contract
principals. Pugh v. Holmes, 486 Pa. 272, 405 A.2d 897 (1979). The intention of
the parties is a primary consideration in the interpretation of any contract. First,
the document itself is to be reviewed when the terms are clear and unambiguous.
Secondly, oral evidence must be considered to explain or clarify or resolve the
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ambiguity irrespective of whether the ambiguity is created by the language of
the instrument or by extrinsic or collateral circumstances. See In re Herr Estate,
400 Pa. 90, 161 A.2d 32 (1960).
General Manager of RCL, Robert Rivkin, contends that Exhibit" A" to the
Lease is the map offered into evidence as Plaintiff's Exhibit 3 and was in the file
in the office of Kocher Coal Company when he became the general partner and
RCL became successor to Kocher Coal Company after a bankruptcy sale. Rivkin
claims the map was the only other thing in the file with the Lease, however,
further testimony in the matter revealed that there were other things placed in
the file and/ or removed periodically from the file. This makes Rivkin' s assertion
that the map was the only other thing in the file questionable.
In Lampenfeld v. Seitz,450 Pa. Super. 527, 676 A.2d 684 (1996), the trial
court, inter alia, properly looked to parol evidence to determine parties' intent
regarding a lease assignment, particularly testimony of the former leaseholder's
attorney, who was the scrivener of an inaccurate metes and bounds description.
Like any other contract, an assignment of a Lease may be interpreted by
reference to parol evidence if the assignment is ambiguous. In re Estate of Hall,
517 Pa. 115, 535 A.2d 47 (1987). In this case, supra, the lease assignment first
specified that it intended to assign the lease of the property which was originally
leased by D.M. Stelitano. The exhibit attached to the assignment, however,
included a metes and bounds description which did not cover the property
leased to Stelitano and in fact does not form a complete parcel of land. Robert
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Lampl was the attorney for II Geraio when it obtamed the lease and also was the
scrivener of the inaccurate mortgage documents. The Court found that his
testimony was highly relevant to explain the ambiguity therein.
Similarly here, the Court must look to parol evidence to determine the
parties' intent with respect to the exhibit. Upon review, we find the most
credible and persuasive testimony was that of defense witness, Steve Shrawder.
Shrawder testified that he was employed by Kocher Coal Company from
1975 to 2000 and was assistant to the President during most of that 25-year
period. He explained that Kocher conducted a mining operation that included
deep mining, surface mining and coal preparation; he was familiar with the COA
and Agreement with DEP concerning the 800-acre parcel in Porter Township,
Schuylkill County, Pennsylvania, and that under the COA Kocher was to begin
reclaiming the permitted stripping pits on Kocher' s property.
During this time Shrawder began negotiations with Padinske of Porter to
dispose of ash in the abandoned pits because Kocher did not have the resources
to reclaim the pits. He testified that the terms of the Lease dated January 29,
1991, were such because Kocher needed Porter's ash to fulfill its obligations
under the COA. Shrawder described the details of the filling of the old
abandoned pits and denied that the "designated ash disposal area" on the map
labeled Exhibit "A" was the only area on which Porter was permitted to dump
ash pursuant to the Lease. On the contrary, he maintained that the entire 800-
acre parcel of land was available for Porter to dispose of ash and that the Exhibit
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"A" to the Lease is the metes and bounds descnphon marked as Defendant's
Trial Exhibit 7.
First, we conclude that an ambiguity clearly exists. The area where ash
can be disposed of must be ascertained from evidence other than the document
itself since the parties disagree as to the true Exhibit II A11 that was referred to in
the Lease. Where an ambiguity exists, the oral evidence presented must be
weighed in order to explain, clarify or resolve the ambiguity. In re Herr Estate,
supra. The parties disagree as to the Exhibit that describes the ash disposal area
referred to in the Lease. Accordingly, the facts and circumstances surrounding
the negotiation and drafting of the Lease as explained by Shrawder are the most
significant and compelling.
Rivkin's argument as to Exhibit II A11 fails for three reasons: 1) Rivkin
found the map with the Lease in the file, however, testimony revealed other
documentation was periodically added or removed from the file; 2) others had
access to the file; and, 3) Rivkin took over the Company years after the Lease was
negotiated and signed and the parol evidence offered by him is not credible.
We find the evidence submitted by Porter in support of its position is
more persuasive and credible. Shrawder testified on behalf of Porter; he is not a
party to this litigation and has no interest, bias or stake in any outcome of the
litigation. He stated throughout his testimony that the intent of the parties was
for Kocher to use Porter to fulfill Kocher' s obligations under the COA and that
Porter had the right to place ash anywhere on the 800-acre parcel of property
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owned by Kocher. lhls specifically mcluded the Holmes and Pnmrose Pits.
Shrawder testified that coal refuse from the present production of Kocher' s
breaker would be placed in the Primrose Pit as well. Shrawder testified that
paragraph 7 of the Lease reserving to Kocher the right to dispose of coal refuse in
the Holmes and Primrose Pits was inserted merely as an accommodation made
by Porter to Kocher.
RCL maintains that Porter does not have the right to dispose of ash in the
Primrose Pit based on the language of paragraph 7 which reserves to Kocher the
right to dispose of coal refuse in the Holmes and Primrose Pits. Furthermore,
RCL maintains that the Lease only authorizes Porter to dispose of ash in the
II
designated ash disposal area' designated on RCL' s Exhibit II A".
Padinske, on behalf of Porter, testified that he negotiated the Lease
directly with Shrawder, and Padinske confirmed that the discussions always
centered around using the entire 800-acre parcel of property for ash disposal.
The map which RCL contends is Exhibit II A" was never used by Shrawder or
Padinske to prepare that Lease. In essence, RCL' s contention that this map
constitutes Exhibit II A" is doubtful.
RCL introduced testimony of the modules submitted by Kocher with its
permit for the site and has alleged that those modules confirm that ash was not
contemplated to be disposed of in the Primrose Pit. Menghini, however, testified
that the modules and mining plans are always subject to change. In fact,
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Menghini dearly and credibly testified that Module 25 did in fact allow for the
placement of flyash/bottom ash in the Primrose Pit.
CONCLUSION
In summary, the evidence presented by RCL is not compelling and was
refuted by the evidence presented by Porter. The parole evidence primarily of
Steve Shrawder, resolves the ambiguity by proving that the intent of the Lease
between Kocher and Porter was to place ash anywhere on the 800-acre site of
Kocher. The individuals involved with the negotiation and preparation of the
Lease credibly testified as to the intent of the parties in 1990 and 1991 when the
Lease was drafted and executed. Additionally, the Lease was drafted by
Kocher' s attorney, Allen Schaeffer, whereby any ambiguity in the Lease weighs
heavily against the drafter of the document.
Accordingly, we enter the foregoing Order.
BY THE COURT:
MILLER,J.
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