Peeveyhouse v. Garland Coal & Mining Co. case brief

Peeveyhouse v. Garland Coal & Mining Co.; (Sup. Ct. of OK, 1963); CB 151; Notes 7

• Facts: P leased half their farm to the D for strip mining. Part of agreement was that the mining company would fill in the pits and smooth out the land. D breached. Cost of restoration $29k, but would only have increased value of land by $300.
• Issue: same as Groves.
• Holding: Court focused on huge discrepancy in numbers, denied cost of restoration damages, awarded P $300. Court said K term was merely incidental.
• Damages: diminution of value. $300.
• Dissent: citing Groves, said that the $29k cost was foreseeable at the time of contract formation and should be awarded to P. Said that P insisted the clause be in K, and therefore it was important to them.
• Commentary: decision cast into doubt by Rock Island Improvement Co. v. Helmerich & Payne, Inc. (10^th Cir, 1983; see CB 163). Similar facts to Peeveyhouse, cost of land restoration hugely disproportionate to the increase in land value. Court applied cost-of-restoration measure. Recent state legislation declared land conservation a policy of the state. This state policy created a strong presumption that the K right of landowners to reclamation was not merely incidental, but an important term of the K.