Bethlehem Minerals Co. v. Church and Mullins Corp., 93-SC-587-TG

• Decision Date: 23 November 1994
• Docket Number: No. 93-SC-587-TG,93-SC-587-TG
• Citation: 887 S.W.2d 327
• Parties: BETHLEHEM MINERALS COMPANY, Bethlehem Mines Corporation, Beth-Elkhorn Corporation, and Bethenergy Mines, Inc., Appellants, Appellees and Cross-Appellants, v. CHURCH AND MULLINS CORPORATION, Claude Johnson, Administrator of the Estate of John Johnson and Individually, Charlie Johnson, Jack Johnson, Martha Kendrick, Priscilla Stiltner, Hazel Johnson, Ben Johnson and Molly Thornberry, and Betty Jane Johnson Stewart, Appellees, Appellants and Cross-Appellees.
• Court: United States State Supreme Court — District of Kentucky

Page 327

887 S.W.2d 327

BETHLEHEM MINERALS COMPANY, Bethlehem Mines Corporation Beth-Elkhorn Corporation, and Bethenergy Mines Inc., Appellants, Appellees and Cross-Appellants, v. CHURCH AND MULLINS CORPORATION, Claude Johnson Administrator of the Estate of John Johnson and Individually, Charlie Johnson, Jack Johnson, Martha Kendrick, Priscilla Stiltner, Hazel Johnson, Ben Johnson and Molly Thornberry, and Betty Jane Johnson Stewart, Appellees Appellants and Cross-Appellees.

No. 93-SC-587-TG.

Supreme Court of Kentucky.

Nov. 23, 1994.

John A. Bartlett, Joseph L. Hamilton, Lively M. Wilson, Stites & Harbison, Louisville, Thomas E. Meng, Stites & Harbison, Lexington, Morton J. Holbrook, Jr., Holbrook, Wible, Sullivan & Mountjoy, Owensboro, John M. Stephens, Stephens & Hurt, Lexington, for appellants, appellees and cross-appellants.

Herman W. Lester, Pikeville, Gary C. Johnson, Pikeville, Gilbert K. Davis, Gilbert K. Davis & Associates, Fairfax, VA, S. Strother Smith, II, Abingdon, VA, for Church and Mullins Corp., et al.

STEPHENS, Chief Justice.

This action commenced in 1964 when Bethlehem Minerals Company, Bethlehem Mines Corporation, Beth-Elkhorn Corporation, and Bethenergy Mines, Inc. ("Bethlehem") filed an action for injunctive relief against John Johnson in the Pike Circuit Court. Bethlehem's complaint charged that Johnson was hindering its survey efforts in preparation for deep mining of the mineral estate underlying certain property known as "Tract 42." Johnson counterclaimed asserting ownership of the surface of Tract 42 as well as the minerals. Subsequent to the initiation of this thirty-year long litigation, John Johnson died. His heirs are the present claimants ("Johnson heirs") in this proceeding along with Church and Mullins Corporation, as lessee of certain mineral rights granted to it by John Johnson in 1970.

Underlying Litigation

What follows is a brief summary of the procedural history of the case preceding Bethlehem's motion for discretionary review of the Pike Circuit Court's denial of its CR 60.02 motion for relief. A more detailed description of the factual dispute and protracted litigation in the lower court is contained in this Court's opinion rendered June 4, 1992.

In 1964 Bethlehem obtained a temporary restraining order prohibiting Johnson's interference with the survey work it was attempting to accomplish with respect to Tract 42. A year later the trial court denied Johnson's motion to quash the restraining order based on Bethlehem's assertion that it sought injunctive relief specifically to protect its ability only to survey, as opposed to its ability to mine. From this point the lengthy title dispute litigation continued until 1986 when the Pike Circuit Court issued a final decision on the merits.

On September 17, 1986 Judge Will Tom Scott entered an opinion awarding the Johnson heirs superior title to the surface and minerals of 211 acres of Tract 42. It found that Bethlehem owned title to the minerals of 164 acres underlying Tract 42. In the latter part of bifurcated proceedings, the trial judge held a hearing on damages. A month later the court entered a final judgment awarding the Johnson heirs $16,947,778 in willful trespass damages plus prejudgment interest.

The Court of Appeals reversed the Pike Circuit Court on the issues of the willful nature of the trespass as well as prejudgment interest. On discretionary review, this Court reversed the Court of Appeals and reinstated the findings and conclusions of the trial court, 887 S.W.2d 321. Pursuant to CR 76.32, Bethlehem filed a petition for rehearing. This Court granted oral argument.

WHETHER THE TRIAL COURT'S DENIAL OF BETHLEHEM'S CR 60.02

MOTION WAS ERRONEOUS

Following this Court's initial opinion and prior to the scheduling of oral argument on Bethlehem's petition for rehearing, the heirs of Miles Smallwood moved to intervene in the underlying action in the Pike Circuit Court. As predecessors in interest to the Johnsons in a portion of Tract 42, the Smallwood heirs claim that the deed purporting to convey that interest excepted all mineral rights. After voluntarily withdrawing their motion, the Smallwood heirs filed a separate quiet title suit against the Johnson heirs. Thus the Smallwood heirs' complaint made no title claim against Bethlehem, but asserted instead an interest as tenants-in-common with the Johnson heirs with respect to one-half interest in a portion of the Tract 42 acreage to which the Johnsons were adjudged to have superior title. As Bethlehem is the stakeholder of the judgment to which the Smallwood heirs claim a share, Bethlehem was joined as a party-defendant to that action.

Based upon the foregoing turn of events, Bethlehem filed a motion to vacate the trial court's judgment under CR 60.02(f), alleging the existence of extraordinary cause. Judge Bayard...