Hillside Coal & Iron Co. v. Sterrick Creek Coal Co.

Citations

• 239 Pa. 359
• 86 A. 865
• 1913 Pa. LEXIS 572

Syllabus

<p>Mines and mining — Goal lease — Construction of lease — Increase of price as affecting royalties.</p> <p>A coal lease dated 1887 provided a royalty of twenty-five cents per ton on coal above the size of pea coal. The royalty on pea coal was ten cents, and on buckwheat coal five cents a ton. The lease further provided as follows: “From and after July 1st, 1892, when the price received for the average of all sizes of coal at the breaker above the size of pea coal shall be $2.18 per ton, the lessee shall pay twenty-five cents per ton royalty on the coal mined from -the four-foot vein, and the same royalty on the pea coal and buckwheat coal from said vein, as is' paid on the coal from other veins; and when the average price for the several sizes above the size of pea coal exceed the sum of $2.15 per ton, the lessee shall pay sixteen per cent, of any such excess. Provided that when the price of pea coal equals that of any of the sizes above pea coal, then, pea coal shall be included with the other sizes in making the average and shall be subject .to the increased royalty.” There was no “excess” until 1897. From 1897 to 1903, with the exception of certain intervals, there was an excess of $2.15 per ton, but no demand was made by the lessor for any increase of royalties on account of the excess. This was due to the fact that the terms of the lease as to excess royalty had been overlooked. After 1903 disputes prevailed between the parties as to the construction of the lease. No coal was mined from the four-foot vein until 1907. Litigation was begun in 1909 by the lessor to recover the excess royalty. Held, (1) that the excess of sixteen per cent, applied to all the coal covered by the lease and not to the coal from the four-foot vein only; (2) that the lessor was not estopped from claiming the excess; and (3) that the failure of the lessor to claim excess royalties from 1897 to 1903, did not justify the conclusion of a contemporaneous interpretation by the parties that n