Phillips v. Sipsey Coal Mining Co.

Decision Date10 May 1928
Docket Number6 Div. 823
PartiesPHILLIPS et al. v. SIPSEY COAL MINING CO. et al.
CourtAlabama Supreme Court

Rehearing Denied Nov. 1, 1928

Appeal from Circuit Court, Walker County; Ernest Lacy, Judge.

Bill in equity by the Sipsey Coal Mining Company against E.J Phillips, Ola Phillips, C.L. Phillips, and Mary Wood, and cross-bill by E.J. Ola, and C.L. Phillips against complainant and respondent Wood. From a decree establishing the lease and its ownership by complainant, that there had been no forfeiture thereof, that respondents Phillips were not entitled to damages for injury or waste, fixing the minimum to be paid thereunder, denying the right of the lessee to use tenant houses, except for employees engaged in mining on the leased premises, that there was no binding transfer by the lessor to his children, that the deed from the lessor to Mary Wood was of force and effect to convey the interest of the lessor alone (and not of Ola Phillips), but not operating to divest the lessor of his right to receive royalties, and that the excess amount of royalties paid by complainant be repaid to complainant, respondents Phillips appeal. Affirmed in part, and in part reversed and remanded.

Cross-bill must be construed with antecedent pleading, and not departure therefrom.

The contract involved in the suit and established by the court is as follows:

"Exhibit A.
"The State of Alabama, Walker County.
"This lease and agreement made and entered into between E.J. Phillips and his wife, Ola Phillips, of said county, hereinafter called the lessors, which expression shall include each and all of their heirs, executors, administrators, and assigns, and J.E. Dilworth, trustee, of Birmingham, Alabama, hereinafter called the lessee, which expression shall include each and all of his heirs, executors, administrators, and assigns, witnesseth:
"1. That the lessors, for in the consideration of one dollar ($1.00), the receipt of which is hereby acknowledged, and the agreements and stipulations hereinafter named, do hereby demise, lease, let, and convey to the said lessee, for a term of twenty years, beginning on this date, all the coal, including Jefferson seam, Black Creek seam, and all other workable seams in, under, and upon the following described lands, situated in Walker county, Alabama, to wit:
"S.E. 1/4 of S.W. 1/4, N.W. 1/4 of S.E. 1/4, S.W. 1/4 of N.E. 1/4, and fraction A, being all that part of the N.W. 1/4 and N. 1/2 of S.W. 1/4 lying east and south of the Warrior river in section 22, and the N. 1/2 of N.W. 1/4 of section 27, all approximately 339 acres and lying and being in township 14, range 5 west, and being all of the mineral lands belonging to the said lessors; and also all the timber and water upon the same necessary for the development, working and mining of said coal and the preparation of the same for market, and the removal of same, also the right of way and the right to build roads of every description over the same necessary for the convenient transportation of said coal from said lands, and the conveying and transporting to and from said lands all materials and implements that may be of use in mining and removal of said coal, or in the preparation of the same for market, and also the right to build all such houses and other structures as may be found necessary or desirable for the use of employees, machinery or any business connected with or in any wise appertaining or incidental to the mining of said coal; provided the use of said land for agricultural purposes shall not be unnecessarily disturbed. And also the right to remove, without further compensation, over and through said lands, all coal mined from any and all other lands that may be acquired or used by the lessee, his successors, heirs and assigns, during the mining of coal from any of the lands hereby leased, or while the minimum royalty of $50.00 per month is being paid; it being agreed and understood between the parties hereto that the said sum of $50.00 per month shall be the amount of rent to be paid for such use of said lands after the mining herein provided for has ceased, so long as the haulage ways and other improvements constructed in, under and upon the same are used in mining or hauling coal from other lands, or in any manner incident thereto.
"2. That the lessee, his successor or assigns will pay to the lessors a royalty of five cents per ton on all coal mined from the lands hereby leased, and after January 1, 1915, the same shall not be less than $50.00 per month, which is hereby fixed as the minimum royalty during the life of this lease from said date until all the workable coal that can be mined at a profit from said lands has been mined; such payments to be made on or by the 25th day of each month for all coal mined during the preceding month; provided for months in which on account of strikes or shortage of cars, dull markets or floods, less than 1,000 tons of coal is actually mined, the said minimum royalty shall not apply and the lessors shall only be paid for the coal actually mined. It is further agreed that if during any month or months any payment or payments shall be made on account of said minimum royalty for coal not actually mined, that the lessee, his successors or assigns, shall receive credit for the sum so paid, on the coal mined during any succeeding month or months in the same calendar year in which there is mined more than 1,000 tons per month.
"3. That the mining and all things provided for herein with reference to said lease shall be done in a workmanlike manner, practical and scientific manner; and work hereunder shall begin within sixty days from this date.
"4. That the lessors, in person or by agent, shall at all reasonable times have the right to examine and inspect the mines in, under, and upon the above-described lands, and should any dispute arise as to the amount of coal mined the railroad weights shall govern as to coal shipped; and on or by the 20th of each month the lessee, his successors or assigns, shall mail to the lessors, their successors or assigns, a statement showing the amount of coal taken from said lands, used during the preceding month in or about the mines, or sold locally and not shipped or to be shipped.
"5. That a failure on the part of the lessee, his successors or assigns to pay the royalty herein provided for for a term of ninety days after the same shall become due, shall, at the option of the lessors, operate a forfeiture of this lease and the said lessors may re-enter and take possession of the interest in the lands hereby leased and this lease shall thereupon become void.
"6. That upon the expiration or termination of this lease, for any cause, or when all the workable coal, from the lands herein described that can be profitably mined has been removed, the lessee, his successors or assigns shall, upon the payment within a reasonable time of all royalty then due have the right to remove from the leased premises all improvements of every character they have placed or caused to be placed thereon.
"7. That the payment of royalty herein provided for may be made to the lessor, E.J. Phillips, his agent, heirs or assigns.
"8. That the lessors covenant with the lessee that they are lawfully seized and own the lands and interests hereby leased, and that the same are free from all incumbrances and that they have a good right to lease the same as aforesaid, and they will, and their heirs, executors and administrators, shall warrant and defend the same to said lessee, his successors and assigns, forever, against the claim of all persons.
"Executed in duplicate, on this 10th day of July, 1914.


"E.J. x Phillips,


"Ola Phillips, Lessors.

"John E. Dilworth, Lessee.

"Witnesses: J.B. Sloan.

"M.A. Sloan."

L.D. Gray and J.B. Powell, both of Jasper, for appellants.

Curtis, Pennington & Pou, of Jasper, for appellees.


The bill was in the nature of an interpleader, and sought affirmative relief against some of the respondents. As originally filed September 9, 1922, it sought to have the court take jurisdiction of the subject-matter, to require respondents to propound their claims to royalties for coal mined in the month of August, 1922, and thereafter to adjudge the respective interests owned in said lease of date of July 10, 1914. Thus the purpose of this pleading was (1) to have the lease exhibited, established, and construed, and (2) to determine complainant's liability to E.J. Phillips or his two children, C.L. Phillips and Mary Wood.

Respondent Catts answered, admitted the allegations of the bill, set up his broker's or agency agreement with the lessor Phillips, and claimed a per ton compensation or indebtedness for his alleged services in procuring the lease. In response to appropriate demurrer, Catts was stricken from the bill as an improper party. Phillips et al. v. Catts, 206 Ala. 594, 91 So. 579; Catts v. Sipsey Coal Min. Co., 212 Ala. 421, 102 So. 895.

In 1914, E.J. Phillips and wife, being the owners of the land described as about 339 acres, were, and are now, domiciled thereon, entered into the lease with "J.E. Dilworth trustee," gave right to the latter to mine the coal from the land on terms and conditions expressly stated in the lease that was transferred to complainant. The latter opened a coal mine, established its entry and mining plant, commissary and employees' houses on these lands near Phillips' dwelling. From this operation of the same, certain controversies arose regarding the royalties that eventuated in a suit at law and one in equity. In the suit in equity, E.J. Phillips exhibited his lease in form and substance as that now exhibited by complainant, and materially different from that which is set up in the Phillips answer and...

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