COALEX State Inquiry Report - 160
March, 1990

Myra Spicker, Esquire
Department of Natural Resources
Division of Reclamation
309 W. Washington Street, Suite 201
Indianapolis, Indiana 46204

TOPIC: REMINING ABOVE AN ABANDONED MINE SITE

INQUIRY: A landowner is suing the state regulatory authority for granting an operator a permit to
mine above an abandoned underground mine. The landowner fears the work will cause
considerable subsidence. Are there any cases which address this issue?

SEARCH RESULTS: Using the COALEX Library and the publicly available materials in LEXIS, a
number of relevant opinions were identified. These are discussed below. Copies are attached.

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INTERIOR ADMINISTRATIVE DECISIONS
OLD BEN COAL CO. v OSM, Docket No. CH 6-1-PR (1987).
   Certain deed and lease agreements granted Old Ben the right to mine coal without liability for
subsidence damage; Old Ben and OSM agreed that "the language does not constitute a waiver of
OSMRE's enforcement authority under applicable law." Old Ben was granted a mining permit but
contested some of the conditions imposed on the permit.

   Part of the ALJ's ruling is as following: (1) Old Ben was required to comply with the provisions
of "the Illinois regulations concerning repair and/or compensation of landowners for subsidence
damage to structures." (2) "OSMRE may require Old Ben to submit plans for mitigation of
potential damage to historic and archeological sites listed on or eligible for listing on the National
Register in areas adjacent to the permit site". (3) "[U]nder Illinois law, Old Ben is not required to
reclaim the shadow area, but must merely restore the area to its pre-mining capability."


FRANK STEBLY v OSM, Docket No. DV 7-2-PR (1987).
   OSM approved the permit for a preparation plant to wash coal on a permitted minesite. Stebly
contended that OSM's EIS was inadequate and "its Finding of No Significant Impact (FONSI) was
erroneous" in violation of NEPA. 

"The requirements of NEPA are satisfied if all environmental considerations are explored. The
burden of the party challenging the agency's decision is to show that it was based on a clear error
of law, a demonstrable error of fact, or that the analysis failed to address substantial
environmental issue of material significance." 


STATE ADMINISTRATIVE AND COURT DECISIONS
BELLE FOURCHE PIPELINE CO. AND EIGHTY-EIGHT OIL CO. v STATE OF WYOMING AND
THUNDER BASIN OIL CO., 766 P2d 537 (Wyo 1988).
   The court affirmed the decision of the Wyoming Environmental Quality Council, finding that
Belle Fourche and Eighty-Eight "holders of easements and lessees", not "surface land owners".
Belle Fourche operated oil and gas pipelines on the property; Eight-Eight operated a truck
receiving station for oil on the property. Thunder Basin' mining operation would necessitate
relocation of the two companies' facilities. The court stated "it was not necessary for Thunder
Basin to obtain the consent of the appellants to its proposed mining and reclamation plan nor to
post a bond to insure compensation for damages resulting in any injury to their interests. Thunder
Basin complied with all the requirements of the [Environmental Quality Act] in its mining
application."


CITIZENS ORGANIZED AGAINST LONGWALLING v OHIO DEPT. OF NATURAL RESOURCES, 41
Ohio App 3d 290, 535 NE 2d 687 (Ohio Ct App 1987).
   A group of landowners appealed the Ohio Reclamation Board of Review's decision approving
Southern Ohio Coal Company's permit to mine using the longwall coal mining method, alleging
that the permit application failed to "include measures required by law to protect the hydrological
balance of the region" and specifically, it failed to "protect individual water users' rights." The
court agreed with the Board that (1) omission of borehole data "did not flaw the permit
application"; (2) although flawed, Southern Ohio Coal's hydrologic determination and the Chief of
the Division of Reclamation's CHIA were adequate; (3) a longwall coal mining applicant may
"provide alternative sources of water" rather than protect the "quantity of water". However, due
to a number of problems found with Southern Coal's water replacement plan, the court remanded
the case to the Board with directions to require Southern Coal to draft a new water replacement
plan.


GEORGE v COMMONWEALTH OF PENN., DEPT. OF ENVIRONMENTAL RESOURCES, 102 Pa
Commw 87, 517 A2d 578 (Pa Commw Ct 1986). GEORGE v COMMONWEALTH OF PENN., DEPT.
OF ENVIRONMENTAL RESOURCES AND CONSOLIDATION COAL CO., 1984 EHB 921, Docket No.
84-223-G (1984).
   Consolidated Coal Company was issued a permit to conduct underground longwall mining. A
portion of the seam being mined lay under George's property. George's property included a
surface stream and waterfall and the coal overlying the seam Consolidated mined. The court
agreed with the Environmental Hearing Board [EHB] that it had no duty to consider the possible
effects of subsidence upon George's underlying coal seam: SMCRA "defines underground mining
activities regulated thereunder to include only the surface impacts incident to an underground
coal mine." The court remanded the question of the effects of subsidence on the stream and
waterfall back to the Board. [The EHB decision is attached.]


CULP v CONSOL PENNSYLVANIA COAL CO., 96 Pa Commw 94, 506 A2d 985 (Pa Commw Ct
1986).
   The issue in the reargued case was "whether the Department [of Environmental Resources]
abused its discretion in granting Consol the subsidence permit without considering Culp's interest
in his superincumbent coal seams." After analyzing the purposes Pennsylvania's Bituminous Mine
Subsidence and Land Conservation Act (1966), the court ruled that it did not "provide protection
for subsurface interests such as Culp's," but that fact "can in no way be seen as detrimental to
the protection of the public interest."


PORTER v COMMONWEALTH OF PENN. DEPT. OF ENVIRONMENTAL RESOURCES [DER] AND
CONSOLIDATION COAL CO., 1985 EHB 741, Docket No. 84-240-G (1985).
   The Porters appealed DER's issuance of subsidence control and coal mining permits to
Consolidated Coal. The Porters, owners of "real property in the permit area", were granted
standing as "they clearly have a substantial, immediate and direct interest in the issuance of
those permits." Evidence presented could only relate to the issues or "injuries which they have
alleged in order to establish standing", i.e., "(i) that the permit applications do not provide for
adequate surface and groundwater monitoring...and (ii) that they anticipate pollution of ground
and surface water on this property." 


ISLAND CREEK COAL CO. v RODGERS, CIMARRON COAL CORP. v RODGERS, 644 SW 2d 339 (Ky
Ct App 1982).
   Island Creek, the underground mine operator, was found "liable for damages to structures on
the surface [the Rodgers and other subdivision residences] which were built after the
underground operations had been abandoned". Cimarron's blasting for strip mining "contributed
to or accelerated the subsidence in conjunction with Island Creek's failure to provide sufficient
support for the surface". Island Creek was held liable for compensatory damage for "failure to
support the surface"; Cimarron was held liable for compensatory damages "to the extent that its
blasting contributed to the subsidence" and for punitive damages because the "blasting was done
in reckless or wanton disregard for the rights of others". The court ordered a retrial on the
"damages aspect of this case".


THE VILLAGE OF WILSONVILLE et al. v SCA SERVICES, INC., 77 Ill App 3d 618, 396 NE 2d 552
(Ill App Ct 1979).
   The court affirmed the trial court ruling enjoining SCA from continuing to operate a chemical
hazardous waste landfill and ordered the removal of the hazardous materials buried there. The
landfill, the village and the surrounding area were located over an abandoned mine site. The
village alleged that as a result of subsidence, hazardous substances would escape from the
landfill and migrate out of the site. Although the court found that evidence of the migration
"uncertain, contingent upon the existence of conditions in the subsurface which were not known",
it concluded "that there was a reasonable likelihood that escape would take place sometime in
the future." There was no "feasible method to protect to public if the hazardous substance did
start to migrate out of the site" and the "actual infliction of injury" was "of a nature that would
likely be catastrophic if it did occur...." 


FEDERAL DECISIONS
INSURANCE CO. OF NORTH AMERICA v U.S. GYPSUM [USG] CO., 678 F Supp 138 (WD Va 1988).
   Subsidence occurred beneath USG's gypsum processing plant. The court ruled that for "the
purposes of an 'all risk' insurance policy," the loss suffered by USG was "fortuitous" - it was
neither intended nor expected - and denied "the insurance company's motion for judgment". 

"Certainly, a subsidence event was a risk at any USG location where mining had been ongoing.
Indeed, subsidence is likely to occur on the earth above a mine but any resulting damage is at
best a risk, not a certainty, especially where precautions are taken....There was no certainty that
any subsidence was destined to occur or, in particular, that it was destined to occur within the
time limits of the policy in issue."


ATTACHMENTS
A.   OLD BEN COAL CO. v OSM, Docket No. CH 6-1-PR (1987).
B.   FRANK STEBLY v OSM, Docket No. DV 7-2-PR (1987).
C.   BELLE FOURCHE PIPELINE CO. AND EIGHTY-EIGHT OIL CO. v STATE OF WYOMING AND
     THUNDER BASIN OIL CO., 766 P2d 537 (Wyo 1988).
D.   CITIZENS ORGANIZED AGAINST LONGWALLING v OHIO DEPT. OF NATURAL
     RESOURCES, 41 Ohio App 3d 290, 535 NE 2d 687 (Ohio Ct App 1987).
E.   GEORGE v COMMONWEALTH OF PENN., DEPT. OF ENVIRONMENTAL RESOURCES, 102 Pa
     Commw 87, 517 A2d 578 (Pa Commw Ct 1986). 
F.   GEORGE v COMMONWEALTH OF PENN., DEPT. OF ENVIRONMENTAL RESOURCES AND
     CONSOLIDATION COAL CO., 1984 EHB 921, Docket No. 84-223-G (1984).
G.   CULP v CONSOL PENNSYLVANIA COAL CO., 96 Pa Commw 94, 506 A2d 985 (Pa Commw
     Ct 1986).
H.   PORTER v COMMONWEALTH OF PENN. DEPT. OF ENVIRONMENTAL RESOURCES [DER]
     AND CONSOLIDATION COAL CO., 1985 EHB 741, Docket No. 84-240-G (1985).
I.   ISLAND CREEK COAL CO. v RODGERS, CIMARRON COAL CORP. v RODGERS, 644 SW 2d
     339 (Ky Ct App 1982).
J.   THE VILLAGE OF WILSONVILLE et al. v SCA SERVICES, INC., 77 Ill App 3d 618, 396 NE
     2d 552 (Ill App Ct 1979).
K.   INSURANCE CO. OF NORTH AMERICA v U.S. GYPSUM [USG] CO., 678 F Supp 138 (WD
     Va 1988).


Research conducted by: Joyce Zweben Scall