HI HAT ELKHORN COAL COMPANY v. Inland Steel Company
| Decision Date | 21 December 1966 |
| Docket Number | No. 16478.,16478. |
| Citation | 370 F.2d 117 |
| Parties | HI HAT ELKHORN COAL COMPANY, Plaintiff-Appellant, v. INLAND STEEL COMPANY, Defendant-Appellee. |
| Court | U.S. Court of Appeals — Sixth Circuit |
Luther E. Woods, Huntington, W. Va., and John M. Stephens, Pikeville, Ky. (Joe Hobson, Prestonsburg, Ky., on the brief), for appellant.
E. R. Hays, Pikeville, Ky. (Francis L. Rice, Baird & Hays, Pikeville, Ky., on the brief), for appellee.
Before O'SULLIVAN and PHILLIPS, Circuit Judges, and McALLISTER, Senior Circuit Judge.
Plaintiff-appellant ("Hi Hat") sued defendant-appellee ("Inland") for $750,000 in damages claimed to have been caused by Inland dumping slate, sludge and other refuse which allegedly prevented Hi Hat from mining coal. After all the proof had been taken, the district judge, the Honorable Bernard T. Moynahan, Jr., directed a verdict for Inland upon the ground that the proof of damages offered by Hi Hat was so speculative that it would be impossible to submit the issue of damages to the jury.
Jurisdiction is grounded on diversity of citizenship. Kentucky law controls.
On the appeal, Hi Hat contends that its proof was sufficient to require submission of the case to the jury and that the district court erred in directing a verdict.
The Elkhorn Coal Corporation originally owned the coal under a sizable tract of land in Kentucky. There were three seams. Elkhorn sold to Inland the mineral rights to seam No. 3. Inland also acquired from others the surface rights. Thereafter Hi Hat obtained a license to begin mining the other two seams of coal, Nos. 1 and 2. This license permitted Hi Hat to conduct exploratory operations and included an option to lease. If the option had been exercised, Hi Hat would have been required to have mined all the recoverable coal in seams Nos. 1 and 2.
Hi Hat commenced operations as a licensee, but never exercised its option to lease. It contracted with independent coal miners under agreements whereby the contractors would mine the coal and haul it to Hi Hat's coal tipple.
Hi Hat's cause of action is bottomed on the contention that Inland dumped slate, sludge and other refuse and that "because of the subsidence of said refuse pile of the defendant, the plaintiff was required to stop all further mining on said tract of land * * * and was prevented, by the acts of the defendant from mining any coal therefrom."
Hi Hat offered various items of proof to substantiate its claim for damages, including loss of prospective profits. In directing a verdict for Inland, the district judge ruled that the evidence of damages was based upon assumptions and speculation, not only as to loss of prospective profits, but also as to the amount of recoverable coal in the two seams and what amount of coal Hi Hat and its contractors were prevented from mining...
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