Nantahala Power and Light Co. v. Horton

106 S.E.2d 461 (1959)

249 N.C. 300

NANTAHALA POWER AND LIGHT COMPANY, Petitioner, v. Oze E. HORTON and wife, Bessie G. Horton; J. G. Stikeleather, Jr., and wife, Dorothy Stikeleather; Ruth Lane Atkinson and husband, Frank C. Atkinson; Herman G. Nichols and wife, Elizabeth Shuford Nichols; and Andrew Gennett, Executor of the Estate of Carter T. Gennett, Deceased, Respondents.

No. 22.

Supreme Court of North Carolina.

January 14, 1959.

Morgan, Ward & Brown, Waynesville, for respondents Horton, appellants and appellees.

Ward & Bennett, Asheville, for respondents Stikeleather and others, appellants and appellees.

BOBBITT, Justice.

Whatever rights the grantors in said deed of May 10, 1938, reserved by the "exceptions, limitations and reservations" therein set forth, vested in respondents Horton when the condemnation proceeding was instituted. Subject thereto, respondents Stikeleather, et al., owned the 557-acre tract in fee simple.

*465 Unquestionably, said reservations and exceptions severed the minerals and mining rights from the surface rights. Vance v. Guy, 223 N.C. 409, 27 S.E.2d 117, and cases cited; English v. Harris Clay Co., 225 N.C. 467, 35 S.E.2d 329.

Respondents Stikeleather, et al., on their appeal, challenge the validity of said "exceptions, limitations and reservations" in respect of water power rights. We accept, for purposes of this appeal, the referee's conclusion of law, adopted by the court, to which respondents Horton did not except, to wit, that said reservations and exceptions were sufficient, "in form and substance, in law, to withdraw from the grant and to reserve in the grantors the water power on said land, within its boundaries, and together therewith the easements recited in connection therewith."

At February Term, 1954, all respondents, by stipulation, deferred their controversy, inter se, and made common cause against the Power Company in the trial that resulted in jury award of $11,500. It is noted that the evidence upon which the jury based its verdict is not before us, nor was it before the referee or court below. What elements of damages were considered by the jury? The record provides no answer.

Under these circumstances it was incumbent upon the contestants to establish their respective interests in the $11,500 fund.

Upon plenary competent and uncontradicted evidence, the referee found, inter alia, that the remainder of the 557-acre tract, after excluding the 90.4 acres, consisted of forest lands with marketable timber of the fair market stumpage value of $24,000 and with wood of the fair market stumpage value of $10,704, and that the only means of access thereto had been destroyed by the flooding of roads within the 90.4 acres. Based largely on these particular findings, the referee found that the damage to the fee in the remaining 466.6 acres caused by the condemnation of the 90.4 acres was $37,280. (Note: The referee found that there was no marketable timber on the 90.4 acres but made no finding as to the fair market value of the 90.4 acres.)

The referee found "that the taking and appropriating of the 90.4 acres and its inundation" by the Power Company destroyed all mineral and water power rights of respondents Horton therein. But the referee also found: (1) "* * * there is no evidence of any actual value of the mineral interest condemned and appropriated or on the remainder of the 557-acre tract." (2) "* * * the portions of the East Fork Tuckaseegee River and Robinson Creek, either separately or jointly, within the boundaries of the 557-acre tract alone, was not susceptible of practical economical hydro-electric water power development and * * * as such had no actual marketable value."

Respondents Horton complied carefully with all procedural requirements to reserve their right to a jury trial. Bartlett v. Hopkins, 235 N.C. 165, 69 S.E.2d 236; Brown v. E. H. Clement Co., 217 N.C. 47, 6 S.E.2d 842; Booker v. Town of Highlands, 198 N.C. 282, 151 S.E. 635. They were entitled to a jury trial "upon the written evidence taken before the referee" (G.S. § 1-189) if it contained evidence that the easement condemned by the Power Company caused more than nominal damages in respect of mineral and water power rights.

1. As to minerals and mining rights, the only evidence offered in behalf of respondents Horton was the testimony of respondent Oze E. Horton. He testified that he had leased a mica mine, "located on a little knob not far below the Island Ford," (within the 90.4 acres) to one R. G. Parker "about 1939 and 1940"; that he thought Parker "had it about two years," but did not know how long it was actually operated or whether the operation was profitable or unprofitable; that he received a *466 straight rental; and that he received such rental (no amount stated) during the years "1938, 1939 or 1940."

He testified: "I testified today that there had been no operation at all on mica since approximately 1939, and that I didn't know how much mica they got out. It is correct that I don't know anything about how long they mined there and didn't find any mica. It is correct that I said that I didn't know whether or not there was any mica up there that could be found on April 4, 1952. "Again: "I said that I don't know that there was a stick of mica in that mine that could be gotten out." Again: "I have not tested elsewhere on the place for minerals."

There was no evidence that the Island Ford Mine contained a mica deposit of value or that the mine had ever been operated profitably or was susceptible of profitable operation.

Booth Wood, a witness for respondents Stikeleather, et al., testified that he worked for Parker when he had the lease but "we quit on account of we couldn't get any mica."

2. No evidence was offered in behalf of respondents Horton as to the value of their water power rights. Evidence offered by respondents Stikeleather, et al., tended to show the course and fall of the East Fork of the Tuckaseegee River and of Robinson Creek, the character of the terrain, etc., within the boundaries of the 557-acre tract. T. A. Cox, witness for respondents Stikeleather, et al., whom the court found to be an expert hydro-electrical engineer, testified that in his opinion there was "no practical commercial water power that could be developed on the Horton tract on the Tuckaseegee River."

Careful scrutiny of the evidence impels the conclusion that there was no evidence sufficient to support a finding that respondents Horton sustained more than nominal damages on account of the destruction of their mineral and water power rights.

Even so, respondents Horton stress their contention that, since they owned the water power rights within the 557-acre tract, all that the Power Company acquired by condemnation were the identical rights they owned. Hence, their argument runs, they should receive all of the $11,500 the Power Company was required to pay. While ingenious, this contention rests on a false premise.

The said "exceptions, limitations and reservations," when considered in the light most favorable to them, vested in respondents Horton only such water rights as were susceptible of development within the boundaries of the 557-acre tract. The easement condemned gave the Power Company the right to build a dam on its property downstream from the 557-acre tract and thereby impound waters which would flood the 90.4 acres and other upstream lands. Respondents Horton owned no such property and had no such rights. In this connection, it is noted that respondents Horton were entitled to compensation solely on the basis of the loss they sustained by reason of the condemnation. Nantahala Power & Light Co. v. Moss, 220 N.C. 200, 205, 17 S.E.2d 10.

In the absence of evidence sufficient to support a finding that respondents Horton sustained more than nominal damages, respondents Stikeleather, et al., owners of the fee, were entitled to the $11,500 fund.

Each assignment of error made by respondents Horton has been carefully considered. None discloses prejudicial error. It is noted that respondents Horton, in their brief, do not direct their argument to each of their several assignments of error but generally to the matters discussed in this opinion.

It is noted that none of the assignments of error raise, hence we do not pass upon, this interesting question: Whether, under *467 the circumstances, the adjudication of the rights of the respective respondents to the $11,500 should have been based on the evidence on which the jury at February Term, 1954, based its verdict.

The basis of decision obviates discussion and decision of serious questions raised on the appeal of respondents Stikeleather, et al., as to the validity of said "exceptions, limitations and reservations," in respect of water power rights; for the judgment, which is in their favor, is affirmed.

Affirmed.