This article is to highlight possible compensation issues in relation to mining activities on private land, particularly those arising under exploration licences but also under mining leases in NSW.
Extract:
"Under the common law, a binding contract must involve consideration: that is, the exchange of something of value for something of economic value. If the exchange appears excessively one sided, the court may question whether a quid pro quo exists and the contract may be voidable"
Two part extracts of sections of the mining act NSW are included for info.
MINING ACT 1992 - SECT 263
Compensation arising under exploration licence
(1) A landholder of any land (whether or not subject to the licence) becomes entitled to compensation for any compensable loss suffered, or likely to be suffered, by the landholder as a result of the exercise of the rights conferred by the licence or by an access arrangement in respect of the licence.
(2) The holder of an exploration licence may agree with a landholder as to the amount of compensation payable, but an agreement reached is not valid unless it is in writing, signed by or on behalf of the parties to the agreement.
MINING ACT 1992 - SECT 262
"compensable loss" means loss caused, or likely to be caused, by:
(a) damage to the surface of land, to crops, trees, grasses or other vegetation (including fruit and vegetables) or to buildings, structures or works, being damage which has been caused by or which may arise from prospecting or mining operations, or
(b) deprivation of the possession or of the use of the surface of land or any part of the surface, or
(c) severance of land from other land of the landholder, or
(d) surface rights of way and easements, or
(e) destruction or loss of, or injury to, disturbance of or interference with, stock, or
(f) damage consequential on any matter referred to in paragraph (a)-(e)
While most of these are self explanatory I highlight the following :
1. "landholder of any land (whether or not subject to the licence)" seems to say that affected landowners do not have to be within the exploration boundary to be entitled to compensation.
2. Any agreement would seem to be a "contract" and be subject to "quid pro quo".
3. "deprivation of the possession or of the use.." and " damage consequential..".
Taking into account the following definitions, these would appear to mean that if possession or use of the land was to include the use of the land as an investment subject to normal market prices, and if the mining activities on or in the near proximity to the land cause the value of that investment to fall; then the landowner ought to be entitled to compensation for the drop in value at least.
Terminology
Deprivation
"the damaging lack of material benefits considered to be basic necessities in a society".
Damage
"physical harm caused to something in such a way as to impair its value, usefulness, or normal function; or unwelcome and detrimental effects"
The Government already links deprivation and asset values as:
"For the deprivation provisions to apply it must be shown that a person has destroyed or diminished the value of an asset, income, or a source of income". (Dept. of Social Security)
For those concerned with the implications of asset values, this may be food for thought (followed with legal advice) as what steps may be taken to help repel these Gov't backed marauders.