Wiggins v. Brazil Coal and Clay Corp.

Citations: 452 N.E.2d 958; 1983 Ind. LEXIS 934Docket: 883S315

Court: Indiana Supreme Court; September 1, 1983; Indiana; State Supreme Court

SummaryOriginalCytator Case TreatmentBackward CitatorAnalysis

EnglishEspañolSimplified EnglishEspañol Fácil

Owners of a strip pit in Clay County, Indiana, sued Brazil Coal and Clay Corporation for damages and an injunction due to the loss of water from their strip pit, which had formed from an earlier strip-mining operation. The trial court ruled in favor of the defendant, leading to an appeal. The First District Court of Appeals reversed this decision and modified existing case law by adopting the Restatement of Torts for groundwater liability. However, the Supreme Court of Indiana granted transfer and vacated the appellate court's opinion. The appellants agreed with the trial judge's factual findings, which established that the plaintiffs owned property with a lake formed by strip mining, and that the lake's water level had fluctuated significantly from 1962 to 1977, relying solely on percolating and surface waters rather than any streams. The lake was divided by a haul road created during the mining process, which also served to maintain a dam-like effect between its two halves.

Between April 1962 and 1970, Mr. and Mrs. Wiggins utilized Sugar Ridge Estates for personal enjoyment and made various improvements. From 1970 to 1973, Mr. Wiggins operated a catfish farm on the lake, marketed thousands of catfish, and charged a daily fee for public fishing access. In 1975, he ceased the catfish farming, closed the lake to the public, and began developing Sugar Ridge Lake Estates for recreational and residential purposes. Other plaintiffs, except Jack Stevenson, Charles A., and Ruth P. Wiggins, purchased lots from Mr. Wiggins and held interests in the eastern half of the lake.

The defendant, Brazil Coal and Clay Corporation, a surface mining company, commenced coal mining operations in 1975 near Center Point, Indiana, without leasing any land from the plaintiffs. By 1977, the company was strip-mining in a manner that involved creating 90-foot-wide pits. Water accumulation in the pits posed operational challenges. In August 1977, while digging at a depth of 50-55 feet, significant water influx flooded the mining pit, prompting the defendant to relocate its equipment and continue mining without further water issues. 

A previous flooding incident in March 1976 had halted mining for three weeks until water was removed. The August flooding necessitated dewatering before continuing operations, as flooding could extend over three-quarters of a mile. To manage this, the defendant drilled two wells to lower the pit water level, discovering that the flooding water originated from the plaintiffs' strip lake through old mine shafts. Consequently, the dewatering efforts led to a decline in the water level of the plaintiffs' lake. The mining area is characterized by extensive undermining from underground mines, primarily affecting the lower coal vein, while the defendant's operations focused on the upper vein.

Defendant obtained underground mining maps prior to commencing operations, which did not indicate deep mines beneath the plaintiffs' strip lake, despite their existence. In August 1977, water from the plaintiffs' lake flooded the defendant's mining pits via deep mine shafts, but the exact path of this water was indeterminate. Before the flooding, the defendant had no knowledge of any connection between the plaintiffs' lake and their mine, as such a connection was not visible from the surface or indicated on the maps. 

To continue mining operations, the defendant dewatered lower deep mine shafts—pumping out water to prevent it from entering the pits above. This dewatering process inadvertently drained the plaintiffs' lake, which was deemed necessary and reasonable for the defendant's mining activities. The defendant's operations were characterized as lawful and beneficial for their property. 

The trial court concluded that the defendant's actions regarding the water were justified for legitimate purposes related to land use. However, the plaintiffs contend that the judgment should be reversed, arguing that the court failed to acknowledge their property rights in the water. They reference Indiana case law, statutes on water resources, the Surface Mining Control and Reclamation Act of 1977, and the Restatement of Torts to support their stance, suggesting a public policy trend that limits absolute property rights in water for landowners. The coal company’s excavation led to flooding, with water migrating through fissures beneath the plaintiffs' property into the defendant's pit, which the defendant managed by sinking wells and redirecting the water into a ditch, thus draining the plaintiffs' strip pit in the process.

The findings indicate that the water table was not implicated, nor was there evidence of water flowing freely on the surface or through a watercourse. The appellants argue that the trial court improperly considered the coal company's business needs as a guideline, referencing Valparaiso City Water Company v. Dickover, where the court ruled that the City had a limited riparian right to lake water and was liable for the unreasonable diversion of water that rendered adjacent beaches unusable. However, this precedent does not apply here as the parties do not own land on the same body of water. 

The appellants also cite Enos Coal Mining Co. v. Schuchart, where damage resulted from vibrations due to nearby blasting, constituting trespass. In contrast, the current case lacks findings of any vibrations or forces from construction affecting the appellants' land. Without such evidence, the coal company cannot be held liable. 

Additionally, The New Albany and Salem Railroad Company v. Peterson established that a property owner may divert water found underground without it being compensable to nearby landowners, as long as the construction was proper and caused no unnecessary damage. Similarly, in City of Greencastle v. Hazelett, the court ruled against an injunction to stop the city's use of land for a cemetery, emphasizing that landowners have rights over resources found beneath their property. Lastly, in Taylor, Admr. v. Fickas, the court affirmed that landowners could manage surface water on their property, provided it does not pass through a natural channel.

The court addressed the property rights related to water, defining both percolating and surface water as part of the land to which they belong. It elaborated that percolating water, which moves through the soil without a defined channel, and surface water that flows temporarily over the land, are included in the principle that a landowner's rights extend to the center of the earth and the sky above. In the case of Gagnon v. French Lick Springs Hotel Co., the court affirmed a temporary injunction against a landowner who diverted water from natural springs, arguing that such actions were part of a scheme to coerce the hotel company into a buyout. The court expressed disapproval of the deliberate intent to harm others while recognizing the historical doctrine that allowed landowners unrestricted control over groundwater. However, it aligned itself with more recent decisions that impose limitations on this doctrine, especially when such control results in injury to neighboring properties. The ruling established that while some alterations to land use may result in unavoidable harm to adjacent properties, actions causing unnecessary injury, such as concentrated or polluted water discharge, could be restrained by the court.

In Argyelan v. Haviland and Central Indiana Coal Co. Inc. v. Goodman, the legal principle established is that a landowner cannot excavate in a manner that withdraws lateral support from adjacent lands in their natural state. Groundwater is deemed part of the land and belongs to its owner, who may utilize it to enhance the enjoyment of their property, provided such use does not cause gratuitous harm to neighboring lands. The case involved plaintiffs whose strip pit, originally dug to access coal, allowed water to seep into a neighboring excavation made by the defendant for coal mining. The defendant's actions did not alter the surrounding land's characteristics, nor was there evidence of intent to harm the plaintiffs. The trial court ruled that the defendant's pumping of water was a beneficial use to prevent flooding and facilitate coal extraction. Consequently, the trial court’s judgment was affirmed, as the loss of water was not part of a scheme to injure the plaintiffs.

Justice Hunter dissented, advocating for a review of the Court of Appeals' decision regarding the application of Section 858 of the Restatement (Second) of Torts for groundwater liability. Hunter argued that the federal Surface Mining Control and Reclamation Act of 1977, which the Court of Appeals cited for preemption of state common law, was not in effect when the plaintiffs' claim arose, as it only took effect on May 3, 1978. Furthermore, Hunter noted that the federal law did not explicitly preclude state law, suggesting a need for clarification on the matter.

The Court of Appeals' decision highlights that Indiana's common law is inconsistent with federal law, particularly in light of the supremacy clause. The Supreme Court's ruling in Hodel established that Congress has the authority to regulate surface coal mining under the commerce clause, and state laws that conflict with federal regulations are preempted. The Congressional intent behind the Surface Mining Act is to safeguard public health and environmental integrity from the adverse effects of surface mining. Section 1307 was designed to offer remedies for damages incurred by plaintiffs, but the majority's reliance on Indiana's common law effectively denies these remedies. 

The majority's adherence to the principle that groundwater is owned by the landowner, allowing unrestricted use unless harm is caused intentionally or maliciously, overlooks the fact that this stance forces plaintiffs to absorb the costs of the defendant's mining activities. This approach contradicts both the federal Surface Mining Act and the Indiana Surface Mining Act, as well as established property and tort law principles. The majority fails to acknowledge current statutes and public policy, instead favoring an outdated rule that originated when scientific understanding of hydrology was limited. Contemporary societal developments have rendered the absolute ownership theory of property outdated, as landowners are now subject to various regulations related to conservation, nuisance, zoning, and pollution. Furthermore, subterranean water rights enjoy a level of immunity from liability not seen in other property rights, marking a significant divergence from established norms governing surface water and subterranean streams. The majority's application of a reasonableness standard to groundwater use is also criticized for being overly narrow, focusing only on the appropriator's needs without considering broader implications.

Riparian water rights are determined by the needs of all water owners, with each riparian proprietor entitled to a reasonable use of water that does not harm others. The reasonableness of water diversion is assessed based on its impact on the water source and other users’ rights, rather than solely on the needs of the diverter's business. If a proprietor diverts more water than can be sustainably managed without harming another's rights, they may be liable. The distinction between percolating ground water and other water forms is deemed unfounded, as both should be governed by similar property laws. Indiana nuisance law allows for recovery of damages when property use is interfered with, applying the principle that property must be used without harming others. The document argues for the adaptation of legal principles to current realities, suggesting that outdated rules should be abandoned in favor of fairness and equity regarding water rights. It also highlights a conflict between existing legal precedents and federal/state policies, particularly related to surface mining and water rights replacement obligations under the Surface Mining Act.

The individual retains the right to enforce their interests in water through lawful means, notwithstanding the statute's prior non-applicability during the defendant's actions that depleted the plaintiffs' lake. The statute reflects legislative intent to remedy harms caused by surface mining, emphasizing that innocent parties should not incur the costs of another's operations. Under the current statute, the defendant could not evade liability for similar actions today. The adoption of Section 858 of the Restatement (Second) of Torts is proposed to align subterranean water rights with legislative policy and riparian principles, which include guidelines on groundwater withdrawal. The trial court deemed the defendant's water use reasonable; however, it also acknowledged significant harm to the plaintiffs, including the loss of enjoyment of their lake. Notably, the defendant continued pumping despite knowing it was lowering the lake's water level, indicating unreasonable harm. The defendant's argument against adopting Section 858 is countered by the principle that businesses should absorb their operational costs rather than shift them to innocent landowners. The defendant was aware of the federal Surface Mining Act, which necessitated adopting corresponding state regulations.

The Act, although not yet in effect at the time of the incident, should have alerted the defendant that its actions were unauthorized. Weighing the equities, it is clear that the defendant ought to bear the costs of its actions. The majority's reliance on common law disregards equity considerations, other property rights, federal legislative intent, and Indiana's legislative policy. Adopting Section 858 of the Restatement (Second) of Torts would harmonize Indiana's subterranean water rights with existing riparian water rights and nuisance laws. Thus, a dissenting opinion calls for the Court of Appeals' decision to be vacated to address the preemption issue, the adoption of Section 858, the reversal of the trial court's decision, and the remand of the case. 

NOTES: Section 501 of the Surface Mining Act established a two-tier regulatory framework for surface mining, mandating federal enforcement in the interim phase and requiring states to implement a compliant regulatory program in the permanent phase, as outlined in Hodel v. Virginia Surface Mining, Reclamation Assoc. Inc.