NOT TO BE PUBLISHED

OPINION

VANMETER, Judge.

Davis Energy, LLC ("Davis") appeals from the Breathitt Circuit Court's April 7, 2014, order amending the court's prior judgment and denying the remainder of Davis's motion to alter, amend or vacate. For the following reasons, we affirm.

Davis's predecessor in title, ZLC Leasing ("ZLC"), entered into a lease agreement with Matt and Rosa Hounshell on or about February 11, 2008, for surface mining on the Hounshells' property. The relevant terms of the lease are set out in Paragraph 3, which states:

After the lease was signed, Davis obtained the rights granted in that lease from ZLC and obtained a permit from the Commonwealth of Kentucky to conduct surface coal mining activities in Breathitt County. Sturgeon Mining Company, Inc. ("Sturgeon") actually mined the coal on the permit as Davis's approved operator.

Davis's permit had an expiration date of January 25, 2011. Prior to the expiration of the permit, on September 27, 2010, Davis submitted an application to renew the permit. However, Davis allegedly failed to pay the required $750 renewal fee. At the time of trial, according to Davis, the renewal application was still pending. A Reclamation Permit concerning Davis's original surface mining permit became effective on June 7, 2012. The Reclamation Permit states that it "is issued in replacement of the previous permit, . . . Only reclamation activities may be conducted on the 213.90 acres covered under this permit (except for roads)."

On or about March 2, 2011, Asberry Stamper, Jr., entered into a mining lease with the Hounshells for the property at issue after contacting the Department of Natural Resources, Division of Mine Permits. Stamper's conversation with the Division of Mine Permits led him to believe that no renewal had been issued on Davis's permit. Prior to that time, Davis claims it received no notice from the Hounshells that the lease had been terminated or expired. A dispute over royalties owed from the coal removed after January 25, 2011, arose between Davis and Stamper. Davis and Sturgeon filed a complaint for declaratory action against Stamper, and Stamper filed a counterclaim, demanding royalties owed to him by Sturgeon. Sturgeon asked the court to determine whether Davis or Stamper were entitled to royalties held by Sturgeon, and the royalties held by Sturgeon were held in escrow pending a determination to whom they were owed. A bench trial took place on September 26, 2013.

At trial, Billy Cameron, an employee with the Reclamation and Enforcement branch of the Department of Natural Resources, testified that on January 25, 2011, he inspected the property and noted that no mining was going on and no coal was being removed. In his mine inspection report prepared the next day, Cameron noted:

Jeff Howard, an employee of the Department of Mines and Minerals also testified at the trial. Howard had previously inspected Davis's mining operation and submitted a mine inspection report, dated December 28, 2010, which also indicated that the permit expired on January 25, 2011. This report further noted "NO VALID PERMIT RENEWAL HAS BEEN SUBMITTED. ALL MINING ACTIVITIES SHALL CEASE AND ONLY RECLAMATION MAY [BE] CONDUCTED PAST THE CURRENT EXPIRATION UNLESS THE PERMIT IS RENEWED PRIOR TO EXPIRATION." According to Howard, Davis did not pay the $750 renewal fee required when submitting a renewal permit, and, therefore, Davis's permit was not valid after January 25, 2011.

Steve Vance, a supervisor at the Department of Mines and Minerals' surface mining enforcement office in London, testified that Davis's renewal was submitted on September 27, 2010. He noted that Reclamation Advisory Memorandum 89, used by the Department, states that a company can continue to mine on a permit after its termination date as long as the renewal application has not been formally denied. However, Vance explained that the Department of Mines and Minerals is divided into two divisions: (1) enforcement; and (2) mining permits. He indicated that the mining permit division would be responsible for issuing renewals, and he works in the enforcement division.

Davis claimed that until a renewal application is denied, coal removal activities can still occur under the original permit. Davis further alleged that coal removal activities did in fact take place on the Hounshells' property after the expiration of the permit, but while Davis's renewal application was pending. However, the owner of Sturgeon Mining testified that this mining was conducted subject to a different permit on an adjacent property, also owned by the Hounshells.

The trial court found that the lease expired on September 27, 2010, the date the permit renewal application was submitted. Davis filed a motion to alter, amend or vacate, and that judgment was later modified to reflect the date of lease termination as January 25, 2011, the permit expiration date. The trial court reasoned that the testimony and records provided by employees of the Department of Mines and Minerals supported a finding that the permit had expired, no renewal thereof had been granted, and no further coal removal was allowed after January 25, 2011. The remainder of Davis's motion to alter, amend or vacate was denied, and this appeal follows.

Davis makes three arguments on appeal. First, Davis claims the trial court's finding that the lease was terminated upon its own terms is contrary to the plain language in the lease. Second, Davis argues that since no notice was given of expiration of the lease, and because the Hounshells accepted royalty payments from Davis after the alleged termination date, the trial court's finding of termination was erroneous. Lastly, Davis maintains that the records maintained by the Commonwealth of Kentucky do not support the trial court's finding that the permit was no longer valid.

For a case tried without a jury, the trial court's factual findings "shall not be set aside unless clearly erroneous, and due regard shall be given to the opportunity of the trial court to judge the credibility of the witnesses." CR 52.01; Cole v. Gilvin, 59 S.W.3d 468, 472 (Ky. App. 2001). A factual finding is not clearly erroneous if it is supported by substantial evidence. Owens-Corning Fiberglas Corp. v. Golightly, 976 S.W.2d 409, 414 (Ky. 1998). Substantial evidence is evidence of substance and relevant consequence sufficient to induce conviction in the minds of reasonable people. Id. The fact-finder is "to determine the credibility of witnesses and the weight to be given the evidence." Uninsured Employers' Fund v. Garland, 805 S.W.2d 116, 118 (Ky. 1991). Issues of law are reviewed de novo by a reviewing court. Nash v. Campbell Cnty. Fiscal Court, 345 S.W.3d 811, 816 (Ky. 2011).

First, Davis argues that the trial court erred by finding that the lease with the Hounshells terminated upon its own terms. Davis claims that termination of the lease was not dependent on whether the permit was valid or invalid. In support of this argument, Davis points to the language in paragraph 3 of the lease, which states, "[i]f said Coal Company is mining on property when lease date expires . . . this lease is automatically extended to allow said coal company to finish mining operations." Davis argues the lease did not terminate when the permit expired on January 25, 2011, since mining operations continued after that date.

However, testimony at trial indicates that mining pursuant to Davis's permit had ceased on the date the permit expired. Pursuant to the terms of the lease between the Hounshells and Davis, the lease would expire on July 10, 2009, unless one of the following contingencies occurred: 1) mining had not yet begun, but a permit was technically approved, meaning that the permit was ready for a certificate of liability insurance and reclamation bond, or, 2) the coal company was mining on that date. Davis was in fact mining under a valid permit on July 10, 2009, so the lease continued until mining was complete. Once mining activity ceased, Davis was no longer permitted to mine on the property, and the lease was terminated.

Without a valid permit, mining operations are not permitted. KRS1 350.060(1)(a) directs: "[n]o person shall engage in surface coal mining and reclamation operations without having first obtained from the cabinet a permit designating the area of land affected by the operation." Davis's permit expired on January 25, 2011. While Davis applied to renew its permit, it neglected to pay the required fee. KRS 350.060(13) provides, in relevant part, "[a]n applicant for renewal of a permit shall pay a basic fee set by regulation, not to exceed seven hundred fifty dollars ($750)." (emphasis added). We agree with the trial court that the "shall" language in this statute means that the fee is mandatory for securing a proper permit renewal. Davis's permit was not renewed, and Davis was therefore not permitted to conduct any surface mining operations after January 25, 2011, other than the reclamation operations permitted by the Reclamation Permit. Accordingly, the lease terminated, upon its own terms, on that date.

Next, Davis argues that because the Hounshells never advised Davis that the lease was being terminated due to non-performance or non-development, the lease could not be properly terminated. However, since the terms of the lease itself, which Davis agreed to, provided for termination when no mining was taking place and no permit was approved, this argument is inapplicable in this scenario. Furthermore, we find no provision in the lease requiring notice to Davis of the lease's termination upon its own terms.

Lastly, Davis claims that the trial court's finding that the permit was no longer valid is unsupported by the records maintained by the Commonwealth of Kentucky. Davis points to Vance's testimony that a permit is valid once a renewal application has been submitted. However, we believe the trial court acted within its discretion as fact-finder in choosing to rely on Cameron and Howard's testimony and the Commonwealth's records in holding that Davis's permit was expired and not renewed. This Court will not substitute its own judgment as to the credibility and weight of the evidence.

For the above reasons, the order of the Breathitt Circuit Court is affirmed.

ALL CONCUR.