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Scottish Court of Session Decisions
You are here: BAILII >> Databases >> Scottish Court of Session Decisions >> Waddell v. The Governors of Daniel Stewart's Hospital [1890] ScotLR 27_815 (21 June 1890)
URL: http://www.bailii.org/scot/cases/ScotCS/1890/27SLR0815.html
Cite as: [1890] SLR 27_815, [1890] ScotLR 27_815
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SCOTTISH_SLR_Court_of_Session
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Court of Session Inner House Second Division.
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v.
Facts:
An agricultural lease reserved to the landlord right to work minerals, the landlord “being always bound and obliged to pay to the tenants all damage which may be done to the surface of ground by the exercise of the above powers, and that by deduction from their rent as the same shall be fixed by two neutral men mutually chosen.”
In an action for arrears of rent by the landlord against the agricultural tenant the defender averred damage to the surface of the ground by subsidence. Held that the clause in the lease included such damage, and was not confined to damage to the surface by operation on the surface, and that accordingly the action was excluded by the clause of arbitration.
By lease dated 7th June and 19th October 1875 the Governors of Daniel Stewart's Hospital let to John Waddell & George Waddell, contractors, Edinburgh, and the survivor and his heirs, a part of the estateof Balbardie, in the county of Linlithgow, known as “Meikle Inch,” for nineteen years, at an annual rent of £240 sterling. In the lease
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was this clause—“Reserving to the said Governors, and their successors and assignees, the whole coal, lime, freestone, ironstone, clay, sand, gravel, stones, and all other metal, minerals, and substances of every description within or upon the lands hereby let, and liberty to search for the same, with power to erect engines and furnaces, buildings, and machinery of every description, and to sink pits, form levels, make roads, railroads, canals, and drains, and to carry on any works which they may consider necessary, the said Governors and their foresaids being always bound and obliged to pay to the tenants all damages that may be done to the surface of the grounds by the exercise of the above powers, and that by a deduction from their rent, as the same shall be fixed by the two neutral men to be mutually chosen.” The Governors also leased the minerals under the said lands to a tenant, who, in order to the proper working of the minerals, sunk pits under and constructed a railway upon the lands. The damage done by these operations had formed the subject of a reference between the mineral tenant and the agricultural tenant. Upon 17th July 1889 the Governors of the Hospital brought an action against George Waddell, the survivor of the joint agricultural tenants, for the rents of the lands of “Meikle Inch” since Martinmas 1887. The defender admitted that the rents sued for would have been exigible under ordinary circumstances, but that under the clause of the lease quoted supra he was entitled to withhold the rent for damage to the lands. He averred that since 1st February 1879 “great damage has been caused, and loss sustained, to the said deceased John Waddell and the defender in consequence of the said mining operations. Large portions of the land were and are rendered useless, and wholly unfit for ploughing or grazing in consequence of subsidence, and the deep and wide rents made therein. The drains and fences—the latter of which were erected by the defender at considerable cost—were, in respect of the portions of land damaged, rendered entirely inoperative and useless. The burn intersecting the lands also became choked by reason of the said mineral workings, and had to be and was cleaned out at the defender's cost. The said deceased John Waddell and the defender were thereby in a large measure deprived of the beneficial use and enjoyment of the said lands. The defender frequently informed the pursuers of this, and called upon them to nominate an arbiter along with him, in terms of said lease, in order that the sum in respect of said damage to be deducted from their rent might be ascertained, but this they refused to do, although admitting that considerable damage had been done. The defender's claims, in respect of the clauses above mentioned and otherwise, amount to the sum of £2745, 9s., being a sum very largely in excess of the amount sued for.”
The pursuers pleaded—“(1) The defender, as heir-at-law to his father the deceased John Waddell, and in possession under the first-mentioned lease, and as the survivor and in possession under the second-mentioned lease, being bound and obliged to pay to the pursuers the rents, drainage charges, and interests sued for, the pursuers are entitled to decree therefor, in terms of the conclusions of the summons, with expenses. (2) The defender is not entitled to retain the rents and others now sued for in respect of illiquid counter claims dating from 1879, now put forward. (4) The defender's counter claims being unfounded in fact and unwarranted by his lease, the same should be repelled, and the pursuers are entitled to decree as concluded for.”
The defender pleaded—“(1) This action is excluded by the arbitration clause in the lease between pursuers and defender. (2) The defender having been deprived to a material extent by the pursuers of the beneficial use of the subjects let to him, is entitled to retain the rent payable by him to them, to the extent of the damage he has suffered. (4) The defender is, in terms of the lease of 7th June and 19th October 1875, entitled to deduct from his rent all damage sustained by him by the mineral workings under his lands.”
Upon 6th January 1890 the Lord Ordinary ( Kincairney) found “(1) that the defender is liable for the rents and sums of interest on drainage expenditure sued for; (2) that the clause in his lease whereby the pursuers became bound to pay all damages done to the surface of the ground by the exercise of the powers there specified, and that by deduction from the rent, does not apply to injury to the surface by mineral workings; (3) that the defender's claim of damages for such injury cannot be entertained in answer to the present action: Therefore repels the pleas for the defender, and decerns in terms of the conclusions of the action: Finds the pursuers entitled to expenses, &c.
“ Opinion.—The pursuers, the Governors of Daniel Stewart's Hospital, are proprietors of the lands of Balbardie and Bathgate, and have raised this action for arrears of rent of two portions of these lands called Meikle Inch Meadow and Meikle Inch. They let Meikle Inch Meadow to the late John Waddell in 1873, and in 1875 they let Meikle Inch to him and to the defender, his son, and the survivor of them, and the heirs of the survivor. John Waddell died on 17th January 1888, and his son and heir, the present defender, has succeeded to the lease of Meikle Inch Meadow, and is now the occupant of Meikle Inch as the survivor of the two joint tenants.
The rent of Meikle Inch Meadow is £20, payable half-yearly, and four sums of £10 each are concluded for, with interest from the several terms Martinmas 1887, Whitsunday 1888, Martinmas 1888, and Whitsunday 1889, when these rents became due. No defence is stated to this part of the action except that the defender has a claim of damages for injury to the other subjects, Meikle Inch, which largely exceeds the arrears of rent of Meikle Inch Meadow. There is no doubt that the defence founded on alleged damage caused to a different
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The other part of the action, which relates to Meikle Inch, is in a different position, and raises questions of much greater difficulty. The rent of Meikle Inch is £240 per annum, and four half-yearly rents are sued for, together with four sums which are interest on drainage expenditure, and are claimed under the lease.
In defence to this part of the action the tenant has averred that the lands have suffered a great deal of injury in consequence of the working of the minerals under them, which minerals belong to the pursuers, and have been let to the mineral tenants, by whom they have been worked. It is averred that the lands have been greatly injured by the subsidence caused by these mineral workings, and that ‘the deceased John Waddell and the defender were thereby in a large measure deprived of the beneficial use and enjoyment of the said lands.’ The pursuer states his claims as amounting to £2745, 9s. He further avers that the drains, the annual charge for which is sued for, have been rendered to a large extent inoperative. The injury averred to have been done to the lands is injury by subsidence of the surface caused by mineral workings. The defender further founds on the clause in his lease by which the pursuers reserved right to themselves to work the minerals and power to ‘erect engines, furnaces, buildings, and machinery of every description, and to sink pits, form levels, make roads, railroads, canals, and drains, and to carry on any works which they may consider necessary; the said Governors and their foresaids being always bound and obliged to pay to the tenants all damage which may be done to the surface of the ground by the exercise of the above powers, and that by deduction from their rent, as the same shall be fixed by two neutral men mutually chosen.”
On this clause the defender has founded his fourth plea-in-law, to the effect that he is in terms of the lease entitled to deduct from the rent all damages sustained by him by the mineral workings under his lands.
If this clause relates to the kind of damage averred, that plea is no doubt sound, and it would be necessary to ascertain the amount of the damage by arbitration or by proof. But it appears to me that I am bound to construe this clause, and ought not to remit the cause to probation, leaving the clause to be construed afterwards, and I have formed the opinion that the clause has no relation to damage by subsidence caused by mineral workings. I think it relates to damage done to the surface by operations on the surface.
It appears to be now well settled that clauses of this kind, at least when they occur in dispositions of the surface, confer no power to let down the surface, and the same rule of construction seems equally applicable when the clause occurs in a lease. Damage in exercise of the power conferred is damage caused legally and under the reserved power, but injury caused by letting down the surface is wholly unauthorised, and founds not a claim for compensation ex contractu, but a claim for damages ex delicto— White v. Dixon, December 22, 1881, 8 R. 375— aff. March 19, 1883, 10 R. (H. of L.) 45; Davis v. Traherne, 1881, L.R., 6 App. Cas. 460; Love v. Bell, 1884, L.R., 9 App. Cas. 286. The powers specially conferred are powers to be carried out on the surface, and the specialty that the damage is to be paid by deduction from the rent points to damage by the occupation of the surface from time to time, and not to damage occasioned by withdrawal of its support.
If that be the sound construction of this clause, it has no bearing on the defence, which is rested on damage by withdrawal of support.
But the defender also maintains (plea 2) that having been deprived to a material extent by the pursuers of the beneficial use of the subjects, he is entitled to retain the rents to the extent of the damage he has suffered. I am not prepared to affirm the law stated in this plea. It is not a plea pointing to abatement of rent, and therefore the recent cases of Muir v. M'Intyre, February 1887, 14 R. 470, and Munro v. M'Geoch, November 15, 1888, 16 R. 93, and the similar cases there quoted, do not apply. I think the plea truly amounts to a claim of damage pleaded against a liquid claim for rent. The rule of law that such a claim cannot be entertained, has as yet always been saved in those cases in which petitions for sequestration have been refused on the ground that the tenant has not received possession of the whole subject leased— Guthrie v. Shearer, November 13, 1872, 1 R. 181. The claim advanced may turn out to be quite well founded, but it is by no means obviously so, nor is it capable of anything like instant verification.
On the whole, I think the pursuers cannot be required to abide the establishment of the defender's claims without violating to a greater extent than any decision has as yet warranted the rule that an illiquid claim of damages is no defence to a liquid claim for debt.”
The defender reclaimed, and argued—The defence here was a sound one. The pursuer brought his action for payment of rent, but the defender alleged that the land had been injured by the operations of the pursuers or their tenants, and therefore they were not entitled to recover the whole amount. The landlord, as proprietor also of the minerals below the surface, was bound to work them in such a manner as would give support to the surface— White v. Dixon, December 22, 1881, 9 R. 375. The pursuers had been lawfully working their minerals and had brought down the surface; that was a damage ex contractu and not ex delicto. It was plain that the clause in the lease did
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The pursuers argued—The Lord Ordinary's judgment was right, and ought not to be disturbed. It had been settled, and the cases cited in the Lord Ordinary's note were conclusive on the subject, that a reservation of the minerals in favour of the landlord was not a reservation of the power to cause a subsidence of surface by his workings. The only power given by this reservation was the power to work and win the minerals without causing any damage. White's case showed that if the tenant found the mineral owner was working his minerals in such a way as to bring down the surface, he could interdict him and so prevent the damage. If this damage was done to the land it was not done under the contract, but ex delicto. The clause in the lease referred to was not intended to have the effect of bringing such serious damage as here alleged to be tried in a summary manner. The only way the defender could recover was by an action of damages.
At advising—
The Lord Ordinary points out that the damage complained of was caused by subsidence of the ground caused by the working of the minerals below, and he is of opinion that such damage does not come within the provisions of the clause referred to by the defender, because in working the minerals so as to bring down the surface of the ground the landlord was not acting lawfully and within his powers under the lease, and that although he may be liable in damages to the tenant it is ex delicto and not ex contractu, and that the clause in the lease has no application. The ground of his judgment is that when the minerals are being worked they must be worked with a due regard to the legitimate interests of the owner of the ground above, or the surface owner as he is often called in our law, and that their prejudicial working may be restrained by the surface owner. The Lord Ordinary refers us to certain cases where it has been held, that in actions between the mineral owner and the surface owner the mineral owner was not entitled to work the minerals in the manner most beneficial and commodious for himself without consideration for the interests of the surface owner.
I of course assent to that law. It is really founded on and illustrative of the maxim Sic utere tuo ut alienum non lædas. It was attempted at one time to set up the pretence that the mineral owner had nothing to do with the risks incurred by the owner of the land, and that was specially pressed in cases where there was a clause for surface damage in the lease. But the Court decided against that contention. Accordingly we have those cases in which the mineral owner has been restrained by interdict from working the minerals in the manner he desired when he did not leave sufficient support for the surface. Generally that support can be left, but where it cannot either some arrangement must be come to or the minerals left unworked. That principle, however, was never held to involve this, that if the working of the minerals was likely to cause any damage to the surface, that the minerals must not be worked. The mines are worked skilfully and with the best appliances that science can procure, and the intention and the likelihood is that the surface will not be shaken, but it may in some cases happen to be damaged, but that is not a case for stopping the working of the minerals by interdict; it is a question of damages. Even where it is plain that the minerals cannot be worked without causing damage to the surface there is a large discretion in the Court whether interdict is to be granted or not. We had a case of that sort before us not long ago. The land above was barren moorland, but the minerals below were rich, and the owner of the land tried to interdict the mineral owner from working until he had been paid for his consent. We refused that interdict. It was, however, plain that the damage would be inconsiderable.
But I am satisfied the case before us does not raise any such question. In the first place, this case is not one between the owners of two separate estates—the minerals and the ground above them—it is a question between a tenant and his landlord. The landlord, who is the owner of the mines, is working his minerals, but he desires to utilise the surface too, and so the surface is let to an agricultural tenant. He gives the tenant notice that in taking a lease of these agricultural subjects they are over mineral workings and are liable to fall in from these workings, and the tenant takes the farm with this undertaking embodied in his lease, that whatever damage is done to the surface by the mineral workings the owner will pay for, and that the amount of damage is to be ascertained by arbiters.
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My opinion is that the tenant is right in his contention, and that this subsidence was damage provided for by the clause in the sub-section upon which the defender relies.
As regards the contention that the clause applied only to damage arising from operations done above ground, and not from below by withdrawal of support, no doubt the ground might have been damaged by use made by the colliery owner above ground, and that use might have been so greatly against the tenant's interest that he could have interdicted the landlord from acting in that manner. That again might have raised the question whether it was necessary for the mine owner in the proper exercise of his rights to have used his tenant's ground in such a manner as to cause damage. Could the landlord in such a case have said, “I did the damage, but I did it in delict, and although I am liable in damages these cannot be ascertained by the arbiters, but must be settled by an action in the Court of Session.” I think that the tenant has stated a relevant defence to his landlord's claim for rent, and that the damage caused to his farm must be assessed in the manner provided for in the lease.
The Court recalled the Lord Ordinary's interlocutor and assoilzied the defender.
Counsel for the Reclaimer— D.-F. Balfour, Q.C.— Baxter. Agents— R. R. Simpson & Lawson, W.S.
Counsel for the Respondents— Asher, Q.C.— Vary Campbell. Agent— Alex. Heron, S.S.C.