Atwater v. Fall River Pocahontas Collieries Co..

• Decision Date: 22 December 1934
• Docket Number: (No. 7967)
• Citation: 115 W. Va. 745
• Court: West Virginia Supreme Court
• Parties: William C. Atwater & Company, Inc. v. Fall RiverPocahontas Collieries Company et al.

115 W.Va. 745

William C. Atwater & Company, Inc.

v. Fall RiverPocahontas Collieries Company et al.

(No. 7967)

Supreme Court of Appeals of West Virginia.

Submitted October 30, 1934.

Decided December22, 1934,

Appeal and Error

"When the record of a chancery cause discloses lack of development of the merits of vital issues in the cause and strong probability of the existence of evidence decisive thereof, the decree is reversed and the cause remanded for further proceedings." Lumber Co. v. Turk, 75 W. Va. 26, 83 S. E. 83.

Appeal from Circuit Court, McDowell County.

Suit by the William C. Atwater & Co., Inc., against the Fall River Pocahontas Collieries Company, the Vaughan Coal & Coke Company, and another. From the decree, the Vaughan Coal & Coke Company appeals.

Reversed and remanded.

Cocke, Hazelgrove & Shackelford and S. D. Stokes, for appellant.

Greever & Gillespie and Crockett, Tucker & Tutwiler, for appellees Wm. C. Atwater & Co., Inc., Fall River Pocahontas Collieries Co., and C. B. Smith.

Litz, Judge:

The purpose of the bill in this case is, to enjoin the sale of personal property under a distress warrant and to obtain the sale thereof under a chattel mortgage.

On May 1, 1901, Tug River Coal Land Company, predecessor in title of the defendant, Bankers Pocahontas Coal Company, leased to Cambridge Coal & Coke Company a tract of 808 acres of land in McDowell County for coal mining purposes. December 27, 1902, the Land Company entered into a new contract of lease with L. H. Vaughan who had acquired the rights of the Cambridge Company, providing for a royalty of eight cents per ton for coal mined and a minimum annual rental of $5,000.00 for a term of thirty years. On February 1, 1903, L. H. Vaughan assigned his rights under his lease to Vaughan Coal Company. The Vaughan Company operated the property until November 25, 1916, when it assigned its rights therein to Fall River Pocahontas Collieries Company in consideration of the Fall River Company agreeing to pay the royalties under the lease to the lessor, the taxes on the land and seven cents per ton for all coal mined and a minimum annual royalty of $4,375.00 to the Vaughan Company. The Fall River Company, a subsidiary corporation of plaintiff, William C. Atwater & Company, Inc., was organized a short while before taking over the lease from the Vaughan Company, with a paid in capital of $90,000.00. The Fall River Company, during its operation under the lease, in April, 1926, distributed among its stockholders a 20% dividend, and in June, following, reduced its capital stock from $90,000.00 to $30,000.00 and distributed the difference in cash to the stockholders. This left it without any working capital and necessitated the immediate and continued borrowing of money from the Atwater Company to keep it going. On November 26, 1927, the Fall River Company executed its note to the Atwater Company in the sum of $64,-798.77 to cover previous loans. On January 3, 1928, the Fall River Company executed a chattel mortgage on all of its personal property to secure the payment of said note. On June 3, 1929, the Vaughan Company caused a distress warrant to be issued and levied upon the personal property of the Fall River Company for delinquent royalties due the former by the latter in the sum of $3,-869.95. On June 10th, following, the Fall River Company notified the Bankers Company and Vaughan Company that it had permanently ceased the mining of coal from the premises because the minable coal therein...