Cadia Holdings Pty Ltd v State of New South Wales (2010) 242 CLR 195 Word Count: 1,496
Introduction- Factual Background
Cadia Holdings Pty Ltd and Newcrest Operations Ltd (NOL) owned land in New South Wales, granted to them by the State of New South Wales under the Mining Act 1992 (NSW). From July 1998 to March 2008, Cadia conducted mining operations in which it recovered minerals including copper and gold, and paid royalties to the Minister pursuant to the Mining Act 1992 (NSW). The Minister referred to the Case of Mines, claiming that the mine owned by Cadia was a “royal mine” containing gold that belonged to the Crown prerogative, and as a consequence the copper was also the property of the Crown. Cadia commenced proceedings against the State of New South Wales and the Minister claiming unjust enrichment and failure to comply with the statutory duty in s 284(2)(a) of the Mining Act 1992 (NSW) to pay to them seven-eighths of the royalties relating to copper.
An analysis of Cadia Holdings P/L v NSW case reveals the issue whether copper when mixed with gold is considered privately owned or publicly owned mineral for the purposes of the Mining Act 1992 (NSW) and whether the Crown's prerogative, established in the Case of the Mines has survived in such a way that would attach it to the intermingled copper with gold being mined.
The court has to decide the issue of whether the intermingled copper and gold was a ‘mine of copper’ or a ‘mine of gold’ or both and what characterisation can be given namely ‘privately owned minerals’ or ‘publicly owned minerals’.
The respective ownership of the parties to their legal rights to minerals of copper and gold
The prerogative rights and ownership of gold and silver existed from the beginning and it is settled law that ownership was and still remains in the Crown. The ownership of gold and silver by the Crown was never taken away though there was a change in the policy to encourage mining activities by private owners on private lands.
The ownership of the copper minerals was granted away by the Crown to private landowners by legislation. The lands on which Cadia Holdings conducts its operations were held by Cadia Holdings and Newcrest under the provisions of the Real Property Act 1900 (NSW). However, the titles may be traced to Crown grants which were made between 1852 and 1859, before the introduction of the Torrens system in New South Wales. In 1868, a primary application was made to bring the lands subject to the grants under the Torrens system. Therefore, gold did not pass by a Crown grant of the land. If this were once debatable, all doubts were dispelled, in New South Wales when the position was expressly recognised by the legislature in the preamble to the Mining on Private Lands Act 1894 (NSW) that “certain other lands have from time to time been alienated without express reservation of any minerals which might afterwards be found therein, but having regard to the well-established laws of England whereby it has been held from time immemorial that the royal metal gold does not pass from the Crown unless by express conveyance in the grant of such lands.”
Gradual developments of policy by the crown lead to a change in the legislation with intention to divest ownership of copper to private landowners.
Although no express reservation to the Crown of minerals appeared in the grants, it was established that this was not necessary to preserve the Crown's rights in respect of the minerals and the right to gold did not pass by a Crown grant of the land. Sir James Colville’s judgement expressed 'that the prerogative right of the Crown to gold and silver found in mines will not pass under a grant of land from the Crown, unless by apt and precise words the intention of the Crown be expressed that it shall pass'. In other words, the history of the title to the land did not affect the Crown's prerogative right...