Shoemaker v. Mount Lookout Coal Co.

Citations

• 177 Pa. 405
• 35 A. 731
• 1896 Pa. LEXIS 999

Syllabus

<p>Mines and mining — Goal lease — Royalty—Selling price at the breaker— Sales agents' commissions — Usage.</p> <p>In an action by a lessor against a lessee for royalties, the lease provided as follows: “ For all coal mined, taken out and disposed of above the size of pea coal, twenty-five cents per ton shall be paid when such coal sells at an average of two dollars per ton or less at the breaker; and when the said coal shall sell at the breaker at more than two dollars per ton, then the amount of royalty shall, for such time, be twenty percent on the amount it shall sell for in excess of two dollars per ton, iñ addition to the said sum of twenty-five cents per ton.” The evidence showed that the meaning of the phrase ‘ ‘ selling price at the breaker,” was by universal usage the actual selling pi'ice at the place of delivery, less the cost of selling, including commissions of selling agents and the freight; that for several years the lessee paid an agent 15 cents per ton for malting sales, which sum in the settlement of royalties, was always deducted from the selling price of the coal without objection on the part of the lessor. A new arrangement was then made by which the lessee sold directly to a coal company at a higher price, but in order to obtain the privilege of making the sales direct he had to pay the agent, who had a written contract for the sale of all the output of coal from these mines, 8 cents per ton for all coal sold to the coal company. Held, that the commission of 8 cents per ton was to be allowed as part of the expenses to be charged in determining the selling price of coal at the breaker.</p>