CHARLESTON – The West Virginia Supreme Court of Appeals has ruled that the West Virginia Department of Transportation Division of Highways must pay property owners for mineral rights and interest—which would total nearly $30 million.

Supreme Court Justice Beth Walker authored the majority opinion. Justice Menis Ketchum concurred and authored a concurring opinion. The opinions were filed on April 17.

“Upon consideration of the parties’ briefs and arguments, the submitted record and pertinent authorities, we affirm the circuit court’s order granting summary judgment to the Veach Heirs and setting the date of commencement of interest from the date of the filing of the condemnation petition,” Walker wrote. “However, we reverse the circuit court’s rulings on attorneys’ fees and costs and we remand the case with instructions to hold a hearing to provide both parties the opportunity to be heard on the issues of whether the Veach Heirs are entitled to recover attorney’s fees and costs and, if so, the reasonableness of the amount to be awarded.”

In 1968, Anna M. Beach conveyed to her three sons approximately 405 acres of real estate in Hardy County subject to mineral reservation. When she died in 2006, her heirs inherited her mineral rights.

In 2005, the DOH began construction on a portion of the highway known as Corridor H near the Beach property and, in the course of construction, the DOH utilized limestone removed from the Veach property and a nearby property belonging to Margaret Z. Newton.

The Veach heirs filed a petition for writ of mandamus in Hardy Circuit Court in October 2010 to force the DOH to institute a condemnation proceeding for the limestone excavated from their property.

The parties entered into an agreed order in March 2011 providing that the DOH would institute a condemnation proceeding against the Beach heirs’ mineral interest, which included the limestone, and the mandamus proceeding was voluntarily dismissed.

A similar agreed order was entered in a separate mandamus proceeding relating to the Newton property.

Later, in the Newton case, a jury fixed the value of the limestone that was removed from the property at $3.79 per ton and allowed a value of $0.25 per ton for limestone remaining in the ground. The DOH appealed that verdict, but the Supreme Court affirmed the verdict.

After the verdict was affirmed in the Newton lawsuit, the DOH retained different counsel to complete the remaining litigation in the Veach matter.

The circuit court later applied the market values for limestone as determined by the jury in the Newton case and ordered the DOH to pay attorneys’ fees and costs; that the Veach heirs be awarded $19,565,393 with interest at a rate of 10 percent per annum accruing from May 27, 2011; $13,051.01 plus interest at a rate of 7 percent per annum for attorneys’ fees and costs in the mandamus action; and $199,243.09 plus interest at a rate of 7 percent per annum for attorneys’ fees and costs in the condemnation action, according to the opinion.

The DOH then appealed the decision to the Supreme Court.

In his concurring opinion, Ketchum wrote that he gives great credit to the DOH’s appellate counsel for arguing the question of what the word “mineral” means when it is used in a deed, will or other document conveying an interest in land.

Ketchum said if the court were to presume that the word “mineral” was ambiguous, it would mean that every deed using that word is subject to challenge in the courts.

“Ambiguity in real estate law leads to blind groping by the courts, promotes instability of titles and encourages litigation. Many decades after a conveying document was drafted, alleged owners will introduce parol evidence of facts peculiar to the transaction to create their own subjective perception of the word’s meaning,” he wrote.

W.Va. Supreme Court of Appeals case number: 16-0326

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