(d) Covenants as to Manner of working the Mine and as to the Condition of the Mine.

The lessee is held to the observance of such covenants when not entirely inconsistent with the skilful and proper working of the mine. Moreover, he will be required to exercise all reasonable diligence in carrying out the terms of his lease, and will be held liable for a disregard of the same unless prevented or interfered with by the lessor; such covenants, having been made with a view to the reversion of the property to the lessor, will prevail against established custom. These covenants are not personal, but run with the land, and become binding upon the assignee of the lease.

Coppinger v. Armstrong, 5 Ap. 637 (1880). A covenant Illinois. by lessee in a lease of land with the right to use rock and burn lime, that all rubbish and spalls should be removed at the expiration of the term, is binding on the assignee of the lease.

Coppinger v. Armstrong, 8 Ap. 210 (1881). But this covenant does not apply to rubbish and spalls on the premises at the execution of the lease, but only to such as result from the operations under the lease.

Cons. Coal Co. v. Schaefer, 135, 210 (1890), affirming s. c. 31 Ap. 364 (1889). S. demised the coal under certain land to N. & H. for twenty-five years, upon condition that they should begin to sink a shaft within three months, and continue the work. Lessees covenanted to "work the mine in a sound, safe, and workmanlike manner, so as not to ruin the works, and leave necessary pillars, and prop up works securely." The lease also provided for forfeiture for failure to comply with any of its covenants. The lessees sunk a shaft and did some work, but became insolvent, and stopped in March, 1886. The mine was finally abandoned in April, and it began to fill with water. It required three months to fill, and the mine was never worked afterwards. On June 22, 1886, the leasehold was sold at judicial sale to the coal company's grantor. In April, 1888, S. gave notice that he terminated the lease. Held, in action of forcible detainer, he could recover. "To permit the mine to keep on filling up with water, and to permit the mine to remain full of water for a long period of time, thereby causing detriment to the mine, and even danger to its continued existence, was surely a breach of the covenant to work the mine in a sound, safe, and workmanlike manner."

The word "ruin," as used in the contract, is not confined in its meaning to an utter destruction of the works, but must be presumed to have been intended to include a serious impairment of the works, and anything which would essentially promote their injury, decay, or destruction.

Randolph v. Halden, 44, 327 (1876). The lease of a coal Iowa. mine stipulating that the lessee was to leave the mine in good working condition at the expiration of the lease, he could not remove

the supports and pillars from the mine even after the supply of coal was exhausted. "The custom of miners to remove the pillars cannot be permitted to control the contract when the effect of allowing such custom to prevail would be to render nugatory express stipulations of the contract." Clark v. Babcock, 23, 164 (1871). Lease provided that Michigan. lessor should put the salt-works in complete order by a fixed time, and in case he did not, that the lessee might do so, and deduct the expense from the rent. Held, if the lessor had failed to put the works in order, then if the well were capable of being put in order, it was lessee's privilege and duty to do so; but if lessor, by what he had done, had rendered it incapable of being put in order, then lessee was not bound to spend any money on it.

It being contended that the work of the lessor in attempting to put the works in order diminished the flow and injured the well, but the expert evidence, which was uncontradicted, tending to prove the contrary, the court will not take judicial notice of the means used in the construction of salt wells to make the tubing serve its proper purposes, and to shut out the detrimental matters which would otherwise injure the work.

Keeler v. Green, 21 Eq. 27 (1870). A stipulation in New Jersey. a lease of a quarry of a horseshoe shape, and having faces on the northwest, north, east, and southeast sides, that "said quarry shall be worked as the face is now open, following the good merchantable stone as deep as such stone shall run, and in good quarrying shape," is not violated by quarrying one of the faces to a greater extent than the other, provided the good merchantable stone was taken out to the depth indicated, and the face was left in good quarrying shape, that is, with a good, fair, even surface, and not with jagged recesses.

Moyers v. Tiley, 32, 267 (1858). See p. 155. Pennsylvania. Trout v. McDonald, 83, 144 (1876). Lease of privilege "of going on the south end of his farm, near No. 14 schoolhouse, and from there west to the old barn, and mining and taking out all the coal he can reach beneath the surface; lessee to work the mine in such a manner as to do the least possible damage to the land; to fill up holes made, and level off all banks and ridges, so as to leave surface smooth and natural. Held, lessee not confined to one opening, but might make as many as are necessary to reach the coal.

Timlin v. Brown, 158, 606 (1893). Lessees covenanted to give up the mine at the end of the term "in a good, workmanlike condition." When they began work they put up a small derrick to raise coal from the bottom of a shaft. They subsequently abandoned this method, adopted a slope, and the shaft was of no further use except as an airshaft. They removed the derrick. This was held in no way to affect the workmanlike condition of the mine, and was not a ground for damages.

South Carolina.

McBee v. Loftis, 1 Strob. Eq. 90 (1845). Where by the terms of a grant of the right of mining the grantee is entitled to work, free of expense, etc., and is in no other respect restricted, he may conduct the work in any manner he thinks proper, either by himself, his servants, agents, or assigns.

C. Duty and Covenants to pay Taxes.

Taxes on coal, like other minerals, whether in place or mined, are of course, in the absence of covenant, payable by the owner thereof. If there is a severance of ownership of surface and mineral in place, the latter being land, the owner is liable to taxation thereon as land. The obligation is not transferred to the owner of the surface by calling the instrument creating the mineral estate a "lease." If it creates an ownership of the minerals, the "lessee" (vendee) must pay the taxes thereon; if it creates but an estate for years, or a privilege or license to mine, the "lessor" must pay the taxes on the unmined coal.

This general rule may be changed by contract, and the obligation of paying taxes on unmined coal as between lessor and lessee may be put upon the "lessor" (vendor), though the lease amounts to a sale, and creates an absolute ownership in the "lessee" (vendee). In this event, if the vendee or "lessee," upon demand, pays the tax to the proper collector, he may recover the amount thereof from the lessor, or set it off in action for royalty or rent.

Logan v. Washington County, 29, 373 (1857). Pennsylvania. Where the owner of coal land has sold the right to take all the coal that is in his land, and retained the land itself, the owner of the land and the owner of the coal are each taxable according to their several interests. But this principle does not justify a higher valuation on the two interests taken separately, than there would have been if both had continued in the same person.

Chevington & Bunn Co. v. Lewis, 10 W. N. C. 196 (1881). The tax imposed upon the corporations by the seventh section of the act of April 24, 1874 (P. L. 68), of three cents upon each and every ton of coal mined by such corporations, or by their lessees, is a tax upon the corporate franchises, to be measured by the number of tons so mined, and not a tax upon the coal itself.

The lessees in a coal-mining lease covenanted to pay all taxes and imposts whatsoever assessed or charged during the continuance of the lease upon the demised premises, or any part thereof, or upon the coal produced therefrom. Held, that this clause of the lease does not include the tax on the corporation (the lessors) imposed by the seventh section of said act of April 24, 1874, which tax is payable by the corporation and not by the lessees.

Sanderson v. City of Scranton, 105, 469 (1884). Where the surface of land and the minerals in place thereunder have been severed by the agreement or conveyance of the owner, and the respective divisions have become vested in different owners, the municipal authorities are bound to levy their taxes according to the ownership and

1 Illinois, Hurd's Rev. Stats. 1895, ch. 94, sec. 6, p. 1053.

value of these divisions. And each owner can be made responsible only for the tax on his own interest, whether underlying strata or surface.

The liability of the owner of coal or mineral in place for taxes levied thereon results from the nature of his estate or interest, and therefore he is not relieved from this responsibility, on the principle inclusio unius est exclusio alterius, by an express covenant in the instrument of severance that he shall pay all taxes levied upon the coal mined, without recourse to the lessor to refund the same.

D. L. & W. R. R. Co. v. Sanderson, 109, 583 (1885). Vendee in last case having paid taxes on the coal in place, under protest, brought this action to recover the amount thereof from the vendors. It was held that no recovery could be had, and the principle of Sanderson v. Scranton was approved.

City of Scranton v. Gilbert, 16 W. N. C. 28 (1885). When the title to the surface of land and to the coal thereunder is vested in one person, the whole must be assessed together for purposes of taxation as land. The surface and the coal cannot be separately valued and assessed, as in the case where the surface and substrata are vested in different owners. The fact that in such case the aggregate valuation on the surface and on the coal beneath is no greater than should be put on the land, does not authorize the separate valuation and assessment of the coal.

Hecksher v. Sheafer, 17 W. N. C. 323 (1886). While, as a general rule for the purposes of taxation, all improvements upon land, such as houses, coal breakers, etc., constitute part of the land, yet persons owning different portions thereof may agree among themselves to such an apportionment of the taxes in respect of such improvements as they may see proper.

A lease of coal land contained a covenant on the part of lessees to pay all taxes upon improvements: Held, that the lessees were bound by said covenant to pay the increased amount of taxes assessed upon the land by reason of its increased value in consequence of the erection upon it of houses, coal breakers, etc., by such lessees.

Woodward v. D. L. & W. R. R. Co., 121, 344 (1888). There was a provision in the coal lease in this case that the lessees should pay all taxes which might be imposed upon the surface of that portion of the land occupied by them and upon the improvements by them made thereon, and upon the coal after it was mined, and that the lessors should pay all the taxes imposed upon the coal in the ground, and upon the surface not occupied by the lessees. The lessors were bound by this covenant, although the lease was such an instrument as under Sanderson v. Scranton conveyed a fee simple in the coal, and the lessees having paid taxes on the coal in place could recover the amount thereof from the lessor.

This liability of the lessors arises from the contract, and is not released by a subsequent conveyance to the lessees of a portion of the surface, with a provision that it should in no way affect their interest in and title to the coal under the lease, nor the rights of either party under its provisions, which were to remain as if the said conveyance had not been made.

Flory v. Heller, 1 Monaghan, 478 (1889). This was a lease of land with the privilege of quarrying for slate, with a provision that machinery and fixtures placed there by lessee should belong to him.

The landlord was assessed taxes on the land and paid the same, and the tenant was assessed taxes on the quarry and machinery which he had placed upon the land. Held, the tenant cannot deduct taxes paid by him from royalties due the landlord as rent.

Miles v. D. & H. Canal Co., 140, 623 (1891). In a lease of coal land which created a divided ownership of coal and surface there was a provision that the lessors should pay all taxes on the leased land; they were held liable for the taxes on both surface and coal in place. And the lessees having paid taxes demanded of them upon the coal in place had the right to retain the amount thereof out of royalties otherwise due the lessor.

Pettibone v. Smith, 150, 118 (1892). A covenant in a coal lease providing "that the said lessees shall pay all and every the United States, State, and local taxes, duties and imposts on the coal mined, the mining improvements of every kind, and the surface and coal land itself," does not include a municipal assessment to defray the cost of building a sewer, and to provide for the cost of grading a street.

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D. Rent and Royalty.1

Mining rent" is a term which is used to mean the consideration money of a mining lease, whether that lease creates a tenancy, grants a license or an incorporeal right, or conveys a fee.

It may be (1) a fixed sum; (2) a certain annual sum; (3) a royalty on the amount of minerals extracted payable at fixed intervals or times; (4) such a royalty, but not less in the aggregate than a fixed amount each year; (5) such a royalty and a covenant to mine a certain minimum amount or pay royalty thereon.

As rent must be something issuing out of the thing granted, and not a part of the thing itself, when the consideration is a part of the minerals, it is not strictly a rent, but an exception.

According as the lease creates a fee, an incorporeal right, a tenancy or license, the rent may be either purchase-money or a true rent.

If the lease out of which it arises is a true lease of the soil or a grant of a right to take minerals, the money or thing which is paid therefor is rent and has all the qualities thereof. It is a preferred debt. It is income, and such as has accrued goes to the personal representatives, and not to the heir of a decedent. It belongs to the life tenant as profits.3

1 See also title "Forfeiture," p. 147.

See pages 8-14, where the cases on

2 North Carolina Code, 1883, sec. 1763. this point are collected.