Holmes v. Alabama Title Co.

In 1943, Woodward Iron Company sold the surface rights to the subject property to Patton, reserving for itself, its successors, assigns, licensees, and contractors the right to mine and remove minerals without liability for any damage that might occur to the surface land as a result of their mining activities. The recorded deed stated this covenant ran with the land. U.S. Steel Corporation took title in 1955 and mined the land from 1968 to 1975. The mine was abandoned and sealed in 1982. Holmes and 128 other landowners (plaintiffs) purchased the surface plots between 1976 and 1981. The plaintiffs reported tremors and surface fractures on their land, and the U.S. Department of Interior determined that the ceiling of the mine had collapsed, which caused subsidence of the surface and damage to the land and appurtenant structures. The plaintiffs’ title insurance policies excluded coverage for all mineral and mining rights. The plaintiffs sued U.S. Steel (defendant) for negligence, wantonness, trespass, and nuisance; and Alabama Title Company (defendant) for fraud, breach of contract, and negligence for failing to adequately inform the plaintiffs of the significance and effect of the covenant. The trial court granted all the defendants summary judgment, holding that the covenant completely immunized them from any action rising from their mining activities. The plaintiffs appealed.