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SHANNON ET AL. v. PENNSYLVANIA ELECTRIC COMPANY (03/20/50)

March 20, 1950

SHANNON ET AL.
v.
PENNSYLVANIA ELECTRIC COMPANY, APPELLANT



Appeals, Nos. 211 and 212, Jan. T., 1949, from judgment of Court of Common Pleas of Bedford County, Sept. T., 1949, Nos. 141 and 188, respectively, in cases of Spencer S. Shannon et al. v. Pennsylvania Edison Company, now Pennsylvania Electric Company and Pennsylvania Electric Company v. Spencer S. Shannon et al. Judgment reversed.

COUNSEL

Robert V. Maine, with him Frank G. Smith, Frank A. Whitsett, Robert I. Reed, Harry C. James and Smith, Maine & Whitsett, for appellant.

John H. Jordan, with him Samuel H. Stewart, for appellees.

Before Maxey, C.j., Drew, Linn, Stern, Stearne and Jones, JJ.

Author: Maxey

[ 364 Pa. Page 380]

OPINION BY MR. CHIEF JUSTICE MAXEY

This litigation grew out of a dispute between the parties concerning the interpretation of a coal lease and claims for royalties and for royalty refunds. The parties entered into an agreement of lease on December 3, 1943, which lease provided for the mining of coal underlying certain tracts of land in Huntingdon and Bedford Counties. It also contained an arbitration clause under the Act of April 25, 1927, P.L. 381, No. 248 (5 P.S. 161, et seq.). The agreement was executed by the appellees, as lessors, and by the Pennsylvania

[ 364 Pa. Page 381]

Edison Company (now Pennsylvania Electric Company, the appellant), as lessee. The coal lease contained provision for the inclusion under its terms of the so-called "Gould" tract, under certain conditions. On July 15, 1949, the appellees caused judgment to be entered under warrant of attorney contained in the coal lease, in the Court of Common Pleas of Bedford County, in the amount of $5,156.74.

On the 18th of August, 1949, appellant obtained a rule to show cause why the judgment should not be opened and the defendant let into a defense, and why the said judgment should not be stricken off. All proceedings for the enforcement of said judgment were ordered stayed pending disposition of that rule. On the same date the court upon the petition of the appellant granted a rule on the appellees to show cause why they should not proceed with arbitration in the manner provided for in a written agreement with the Pennsylvania Edison Company and to show cause why the Judge of the Court of Common Pleas of Bedford County should not appoint an arbitrator for them as provided by the arbitration provisions of said agreement. Later both rules were discharged and this appeal followed.

On December 3, 1943, Spencer S. Shannon, Kathryn W. Shannon and Leon Falk, Jr., Trustee for Spencer S. Shannon, Jr., and Patricia Shannon, appellees, entered into a written lease (hereinafter referred to as the Shannon Lease) with the Pennsylvania Edison Company, now the Pennsylvania Electric Company, appellant, granting to the latter the mining rights to coal underlying certain tracts of land in Huntingdon and Bedford Counties. The lessee agreed to pay to the lessor a royalty of 15c for every ton of coal mined and removed from or used by the lessee on the leased premises.

[ 364 Pa. Page 382]

The lease contained a confession of judgment and also a provision for the arbitration of disputes, as set ...


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