Roberts v. Unimin Corp. (214 F. Supp. 3d 743, 2016)

OPINION AND ORDER

J. LEON HOLMES, UNITED STATES DISTRICT JUDGE

This action concerns a mineral lease. Kathy Roberts and Karen McShane, currently the lessors, seek a declaratory judgment that the lease is terminable at will under Arkansas law. Unimin Corporation, the current lessee, filed a motion to dismiss for failure to state a claim on September 25, 2015. Document # 12. The Court denied the motion and pointed out that the issue was one of first impression for the Arkansas Supreme Court. Document # 25. Unimin then filed a motion for summary judgment on March 3, 2016, asking the Court to decide as a matter of law that the lease is not terminable at will. Document # 53. The plaintiffs filed a motion for partial summary judgment on March 17, 2016, asking the Court to decide that the lease is for an indefinite term and, therefore, terminable at will. Document # 56. The Court has reviewed extensive briefing from both parties and heard oral argument on October 5, 2016. For the following reasons, Unimin’s motion for summary judgment is granted and the plaintiffs’ motion is denied.

I.

A court should enter summary judgment if the evidence, viewed in the light most favorable to the nonmoving party, demonstrates that there is no genuine dispute as to any material fact and that the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a); see also Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249-50, 106 S.Ct. 2505, 2511, 91 L.Ed.2d 202 (1986); Torgerson v. City of Rochester, 643 F.3d 1031, 1042 (8th Cir. 2011) (en banc). A genuine dispute of material fact exists only if the evidence is sufficient to allow a jury to return a verdict for the nonmoving party. Anderson, 477 U.S. at 249, 106 S.Ct. at 2511.

II.

The lease at issue is the third in a series of leases dating back almost a century. In 1918, J.W. Williamson and Lizzie Williamson entered into a lease that granted Odell-Daly Material Company the right to mine the property for siliceous materials for a term of twenty years. The lease contained a royalty provision that provided:

For the first Five (5) years of said term the royalty shall be five (5) cents per ton on all materials shipped in crude form and three (3) cents per ton on all materials shipped in milled or pulverized form; that during the remainder of said term it is agreed that the royalty shall be five (5) cents per ton on all materials alike.

In 1934, J.W. Williamson entered into another lease for the property with similar royalty language: “Five cents (5