Kathy Roberts v. Unimin Corporation , 883 F.3d 1015 ( 2018 )


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  •                   United States Court of Appeals
    For the Eighth Circuit
    ___________________________
    No. 16-4172
    ___________________________
    Kathy Roberts; Karen McShane
    lllllllllllllllllllll Plaintiffs - Appellants
    v.
    Unimin Corporation
    lllllllllllllllllllll Defendant - Appellee
    ____________
    Appeal from United States District Court
    for the Eastern District of Arkansas - Batesville
    ____________
    Submitted: December 12, 2017
    Filed: February 28, 2018
    ____________
    Before SMITH, Chief Judge, ARNOLD and KELLY, Circuit Judges.
    ____________
    ARNOLD, Circuit Judge.
    For the past century, the Williamson family has leased out a plot of Arkansas
    land for silica mining. The current lease, signed in 1961, provides for a term of years
    until 2007 and continuing "as long thereafter as" certain activities occur on the
    property. In 2015, Kathy Roberts and Karen McShane (both née Williamson), the
    present lessors, sought a declaratory judgment against Unimin Corporation, the
    present lessee, that the lease created a tenancy at will. The lessors claimed further that
    the lease was unconscionable and that Unimin had unjustly enriched itself by refusing
    to vacate the land when they demanded possession. After the close of discovery, the
    lessors dismissed their unconscionability claim with prejudice. The district court1
    granted summary judgment to Unimin on the remaining claims, ruling that the lease
    had created a determinable leasehold, not a tenancy at will, and so Unimin did not
    unjustly enrich itself by staying in possession. The lessors appeal from that judgment,
    and we affirm.
    We review the district court's grant of summary judgment de novo, keeping in
    mind that summary judgment is appropriate if there is no genuine dispute of material
    fact and, viewing the record in a light most favorable to the lessors, Unimin is entitled
    to judgment as a matter of law. See Smith v. Arrington Oil & Gas, Inc., 
    664 F.3d 1208
    , 1212 (8th Cir. 2012). We also review the district court's construction of the
    lease and its interpretation of state law de novo. 
    Id. The parties
    to this diversity action
    agree that Arkansas law governs. See 
    id. On appeal,
    the lessors challenge only the district court's ruling that the lease
    created a determinable leasehold and not a tenancy at will. The lease provides that the
    leasehold will endure as long as "siliceous materials" are "shipped" from the lessee's
    mill and at least one of the following activities also takes place on the land: "mining,"
    "mining operations," or "transport[ing]" siliceous materials. The lessors contend that
    the term of the lease is indefinite and thus terminable at will since it may never end
    of its own accord: Unimin could, in theory, ship siliceous materials from its mill and
    conduct mining operations on the land forever. No one disputes that the lease did not
    create a perpetual leasehold. See Pults v. City of Springdale, 
    745 S.W.2d 144
    , 146–47
    (Ark. Ct. App. 1988). But if the lease is not perpetual and lacks a predetermined end
    1
    The Honorable J. Leon Holmes, United States District Judge for the Eastern
    District of Arkansas.
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    date, the lessors reason, then it must have created a mere tenancy at will. The
    difficulty with that logic, as the district court pointed out, is that it misconstrues the
    type of indefiniteness that creates a tenancy at will, while ignoring an entire category
    of property interests under Arkansas law—determinable estates.
    Arkansas law is clear that a tenancy at will exists when a lease "is silent as to
    its duration," see Cottrell v. Cottrell, 
    965 S.W.2d 129
    , 130 (Ark. 1998), or does not
    otherwise grant land to the lessee "for any definite time." See Ritter v. Thompson, 
    144 S.W. 910
    , 911 (Ark. 1912). The lease at issue here, by contrast, leases the property
    for as long as certain activities occur on it. By specifying that the lessee may stay in
    possession until those activities cease, the lease created a determinable estate, not a
    tenancy at will. See Rostell v. Ark. & Ozarks Ry. Corp., 
    323 S.W.2d 539
    , 541 (Ark.
    1959); Houston v. First Baptist Church, 
    242 S.W.2d 966
    , 967 (Ark. 1951). Under
    Arkansas law, a determinable leasehold is a property "interest which may continue
    forever, but . . . is liable to determine by some act or event circumscribing its
    continuance or extent." See Moody v. Walker, 
    3 Ark. 147
    , 190 (Ark. 1840). Since it
    has "a definite term," it is not subject to cancellation at the lessor's will. Flinn v.
    Cullins, 
    220 S.W. 449
    , 449–50 (Ark. 1920); see also 
    Cottrell, 965 S.W.2d at 130
    ;
    Bodcaw Oil Co. v. Atl. Ref. Co., 
    228 S.W.2d 626
    , 632, 635 (Ark. 1950).
    The lessors maintain that they may terminate this leasehold at will because no
    one knows when or whether it will determine. But the fact that it could last forever
    if its determining event does not occur is irrelevant. See Union Cty. v. Union Cty.
    Fair Ass'n, 
    633 S.W.2d 17
    , 19 (Ark. 1982); Coffelt v. Decatur Sch. Dist., 
    217 S.W.2d 347
    , 348 (Ark. 1949) (Coffelt II); Coffelt v. Decatur Sch. Dist., 
    208 S.W.2d 1
    , 2 (Ark.
    1948). It is characteristic of all determinable estates that "the reverter may not take
    place for an indefinite period in the future," if at all. See Fletcher v. Ferrill, 
    227 S.W.2d 448
    , 451 (Ark. 1950). Uncertainty over when or whether the estate will
    determine does not deprive its term of definiteness, nor covert it into a tenancy at will
    as long as the term is "capable of being made certain." See 
    Flinn, 220 S.W. at 450
    . As
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    we already noted, the lease provides that it will expire when "siliceous materials" are
    no longer "shipped" from the lessee's mill or when "mining," "mining operations,"
    and "transport[ing]" siliceous materials no longer occur on the land.
    The lessors maintain nonetheless that the leasehold here is not determinable
    since some of its determining events are so vague that no one could ascertain if they
    had occurred. The lessors argue that the term "mining operations" encompasses so
    many activities—like stockpiling siliceous materials and maintaining a right-of-way
    —that it may be impossible to tell when they cease. But Arkansas courts have long
    enforced leases that provide they will remain in effect for as long as mining or drilling
    "operations" persist, without the slightest indication that the term was problematically
    vague. See, e.g., Gray v. Cameron, 
    234 S.W.2d 769
    , 770 (Ark. 1950); Winn v.
    Collins, 
    183 S.W.2d 593
    , 596–99 (Ark. 1944); cf. Graham v. Jonesboro, Lake City
    & E. R.R. Co., 
    164 S.W. 729
    , 731 (Ark. 1914). Leases that provide "the lessee may
    continue holding the lease until operations cease" have become the dominant type of
    lease used in the nation's mining industry, see 4 American Law of Mining § 131.05(2)
    (2d ed. 2017), and the lessors do not direct us to a single Arkansas case holding that
    the term was vague. We detect nothing unique about the use of the term "mining
    operations" in this case, cf. Snowden v. JRE Invs., Inc., 
    370 S.W.3d 215
    , 217 (Ark.
    2010), and therefore conclude that it is not vague.
    The lessors question, moreover, how someone can tell whether transporting
    siliceous materials across the property has ceased or was only in a lull. In construing
    determinable estates, however, courts must routinely decide whether and when a party
    has abandoned the purpose for which the land has been granted. See Coffelt 
    II, 217 S.W.2d at 348
    . We do not see any vagueness here, either.
    The lessors maintain as well that the term "mining operations" is ambiguous,
    but they do not develop the argument. Their overriding concern seems to be that they
    may find it difficult to tell whether operations are still ongoing and that Unimin might
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    take advantage of the term's breadth by asserting that operations are ongoing when
    they in fact are not. That simply means, however, that the proper scope of the term is
    subject to conflicting interpretations, which is true in every instance where parties do
    not see eye to eye: It does not necessarily mean the term is vague or ambiguous. See
    Elam v. First Unum Life Ins. Co., 
    57 S.W.3d 165
    , 169–70 (Ark. 2001); Garner v.
    XTO Energy, Inc., 
    2011 Ark. App. 606
    , at *1–2 (Ark. Ct. App. 2011); see generally
    Schnuck Mkts., Inc. v. First Data Merch. Servs. Corp., 
    852 F.3d 732
    , 738 (8th Cir.
    2017). The lessors find it significant that Unimin's corporate representative was either
    unwilling or unable to devise a comprehensive list of all the activities that might
    qualify as "operations." But it is a well-known truth about language that the meaning
    of a term may be certain and clear when applied to a concrete situation, yet "resist
    precise definition" in the abstract. See United States v. Strohm, 
    671 F.3d 1173
    , 1180
    (10th Cir. 2011). So we see no reason to hold that the challenged determining events
    are fatally ambiguous.
    In addition to their possibility of reverter on the determination of the leasehold,
    the lessors have a separate right of reentry if Unimin does not timely and properly pay
    them royalties, ceases to operate its mill and ship siliceous materials for twelve
    consecutive months (unless one of four specified events has prevented Unimin from
    such activities), or violates any other obligation it has under the lease's "terms,
    conditions or covenants." We express no view, however, on the meaning and effect
    of that provision since the lessors do not argue that it supports their claim that the
    lease created a tenancy at will, and Unimin does not ask us to construe the leasehold's
    determining events in light of it.
    Affirmed.
    ______________________________
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