Cook Industries, Inc. v. Carlson

• Decision Date: 03 December 1971
• Docket Number: No. DC 701-K.,DC 701-K.
• Citation: 334 F. Supp. 809
• Parties: COOK INDUSTRIES, INC., d/b/a Riverside Industries, and City of Marks, Plaintiffs, v. Mrs. Beverly M. CARLSON et al., Defendants.
• Court: U.S. District Court — Northern District of Mississippi

334 F. Supp. 809

COOK INDUSTRIES, INC., d/b/a Riverside Industries, and City of Marks, Plaintiffs, v. Mrs. Beverly M. CARLSON et al., Defendants.

No. DC 701-K.

United States District Court, N. D. Mississippi, Delta Division.

December 3, 1971.

COPYRIGHT MATERIAL OMITTED

Pat D. Holcomb, Clarksdale, Miss., for Cook Industries, Inc.

Ben M. Caldwell, Marks, Miss., for City of Marks.

Ted Lucas Smith, Batesville, Miss., James F. Schaeffer, Memphis, Tenn., for defendants.

MEMORANDUM OPINION

KEADY, Chief Judge.

In this diversity action, the plaintiffs are Cook Industries, Inc., suing on behalf of its corporate subsidiary, Riverside Industries (Riverside), a business entity engaged in processing cotton and bean seed, refining vegetable oil, and manufacturing agricultural chemicals, and the City of Marks, Mississippi (Marks), and the defendants are two sisters, Beverly M. Carlson and Ellen M. Berlin, who are Tennessee citizens owning certain farmlands and subdivision property in and near Marks, Mississippi.¹ The suit was originally brought on December 16, 1969, in the Chancery Court of Quitman County, Mississippi, in which plaintiffs averred that Riverside as lessee-operator of the industrial property and Marks as its lessor-owner held an easement for water drainage across the adjoining property of defendants and sought an injunction to require the opening of a drainage ditch on the Carlson property as well as damages for defendants' closing the ditch on the previous day. The Chancellor immediately and without notice issued the temporary injunction requested.

On January 14, 1970, defendants removed the case to federal court, asserting in their removal petition that their farm tenant, E. T. Kelsay, Jr., a Mississippi citizen, was fraudulently joined as a defendant for the sole purpose of defeating federal diversity jurisdiction. Plaintiffs did not seek any relief against Kelsay, nor did they file a motion to remand or otherwise question removability. Kelsay has made no appearance in the cause. Thus the court disregards his joinder as a party defendant in accepting jurisdiction.

Plaintiffs charge in their complaint that for 25 years Marks has continuously used and maintained an easement across defendants' lands for the drainage of storm and surface waters from a large portion of the city's area and that Riverside for more than 10 years had used the same drainage ditches for draining water used in its manufacturing operations; and that the closing by defendants of a portion of the drainage ditch at a point near Riverside's property line, if allowed to remain, would cause the water to back up and flood Riverside's plant, thereby causing it great property damage and the discontinuance of its business operations, and such condition also threatened with flooding the businesses, homes and other property of the citizens of Marks. By their answer, defendants denied that plaintiffs had an easement for drainage across their property either by prescription or otherwise, and asserted that Riverside had substantially changed and increased the natural flow of water by its constant pumping of huge quantities of polluted, odorous and unsightly fluids onto their property. Admitting that they closed the drainage ditch as charged, the defendants nevertheless asserted a legal right to abate the condition as a private nuisance. Defendants counterclaimed for injunctive relief against continued maintenance of a nuisance and also substantial damages for injury to their lands resulting from the joint acts of Riverside and Marks.

By an amended complaint, plaintiffs pled that Marks held an easement grant which defendants executed on May 31, 1961, for a right-of-way through and across an area later known as Morgan Manor Subdivision to construct a drainage ditch and to enlarge and clean out drainage ditches on the described property. Defendants counter that the instrument was executed as the result of misrepresentation or mistake, but if valid the grant was intended only as a general drainage easement covering only a small portion of the ditch involved in the controversy, and the excessive and altered use by plaintiffs nevertheless violated the terms of the easement.

The court conducted an extensive evidentiary hearing, following which the parties submitted legal briefs. The case is now ripe for decision and this Memorandum Opinion will suffice for findings of fact and conclusions of law required by Rule 52, F.R.Civ.P.

I.

Many basic facts are undisputed. On December 15, 1969, the defendants together with their husbands hired a bulldozer and operator and directed the building of a small dam in an open ditch which drained industrial water from Riverside's plant through defendants' lands. This dam was built on subdivision lots owned by Mrs. Carlson southeast of Riverside's fenceline. This abrupt halt to the flow of water soon caused a backup on Riverside's property. Because Riverside's operations required a place to discharge liquid waste and used water, the plant was forced to shut down nine hours until the backwater subsided and an emergency means of drainage was obtained by digging a ditch southerly on Riverside property to an established east-west drain along Roger Road, the water then going east to a point at which the flow reentered the ditch in controversy on other property of Mrs. Berlin.

The general course of the disputed ditch extended southeasterly across subdivision lots for approximately 1000 feet, or to Roger Road, from which the drainage continued in an open ditch in the same direction for another 1200 feet to Tom Hill Bayou. Tom Hill Bayou flows on a northerly course and empties into Coldwater River. This entire length of ditch runs through property which defendants jointly inherited from their grandfather and came into possession of upon the death of their father in 1951. The property is partly inside and partly outside the southern corporate limits of Marks. The lands have since been partited between defendants, but most of the property is still farm land consisting of 142 acres lying south of Roger Road, of which Mrs. Berlin owns 66 acres and Mrs. Carlson owns 76 acres. The balance of the subject property, owned by Mrs. Carlson, lies north of Roger Road, and presently consists of 19 lots in Morgan Manor Subdivision. Established in 1961, this subdivision has four dedicated streets which run north and south. Three streets have been paved, and residences have been built upon certain lots previously sold by Mrs. Carlson. The fourth street, Poplar, is one block long and has not been laid out or improved. Poplar Street is bisected by the first segment of the disputed ditch about 300 feet southeast of the east boundary of Riverside property. The lots owned by Mrs. Carlson which abut the east and west sides of Poplar Street are low and vacant ground.

In the mid-1960s Marks, in accordance with city-developed plans, was permitted to come upon the subdivision area to cover old ditches, put in underground sewer pipes, adjust remaining ditches, and pave certain streets. The elimination of unnecessary ditches, without doubt, made the territory more suitable for subdivision development. As a part of this program Marks secured from defendants an easement grant which confirmed the historical natural drainage through the open ditch to Roger Road and also granted the city a right to expand its underground storm sewer system southwardly under and along Poplar Street and thus connect with the open ditch leading to Tom Hill Bayou. Pursuant to this grant, Marks extended the storm sewer which is actively used by the city. After this litigation began, Riverside rerouted its effluent through this underground pipe, thus avoiding contact with Mrs. Carlson's lots lying west of Poplar Street.

Years before, in 1937—with the consent of defendants' father—Marks had deepened and enlarged a ditch forming the west fork of Tom Hill Bayou to improve the surface drainage into Coldwater River. The city, however, never used the ditch as a sanitary sewer or for any purpose other than to remove uncontaminated water.

In 1956 Riverside, or its predecessor in title, purchased from Mrs. Berlin part of the lands on which its plants are located and which had drained through the open ditch crossing the lots now known as Morgan Manor Subdivision and on into Tom Hill Bayou. Since 1940, Riverside and its predecessor operated both a cotton gin and oil mill on this original property, making use of defendants' drainage ditch for discharge of industrial water without objection until the present controversy arose.

In 1966 Marks acquired by purchase Riverside's entire industrial property and made extensive expansions of plant and equipment at a cost of $2,500,000, financed by industrial revenue bonds. These improvements included the installation of a new system of seed crushing and oil refining, which called for the use of a much greater amount of water. Riverside then became the operator of the expanded property, under a long-term lease executed with the City, in accordance with Mississippi's BAWI program.² The new system was installed by Riverside's operating personnel, after ascertaining the operating experience of similar plants and seeking consultants' advice regarding the treatment of waste.

The new oil refinery process entailed the commingling of raw materials and chemical substances with large volumes of water supplied by three wells having a total output of 3200 to 3400 gallons per minute.³ Riverside operated its plant uninterruptedly 24 hours each day, with downtime of not more than 30 days annually. While Riverside's chemical plant discharged its waste into a separate underground system, the oil refinery discharged effluent directly into the open ditch at the rate of approximately 3200 gallons of used water per minute. This volume of discharge never exceeded the ditch banks or overflowed on adjoining property. The effluent, however, contained quantities of...