Peevyhouse v. Garland Coal Mining Co.
Supreme Court of Oklahoma
382 P.2d 109 (1962)
The Peevyhouses (plaintiffs) leased their farm to Garland Coal Mining Co. (defendant) for five years of strip mining, with Garland contractually agreeing to perform restorative work on the property at lease's end, estimated to cost Garland roughly $29,000; Garland mined the property but never performed the remedial work, and the Peevyhouses sued for $25,000 in damages. The trial court instructed the jury to consider both the cost of performance and the diminution in property value from non-performance, and the jury awarded $5,000 — an amount exceeding the farm's total value even with the remedial work completed — prompting cross-appeals.
Whether damages for breach of a lease provision requiring remedial land restoration should be measured by the full cost of performance, or limited to the diminution in property value, when the cost of performance is grossly disproportionate to the resulting economic benefit and the provision was merely incidental to the contract's main purpose.