Mining licence — Statutory provision for variation and renewal — Sections 77(2) and 103D(3) of Mining Act 1971 — Whether 10-year term of licence a condition capable of variation — Whether appellant having right to grant of new licence on expiry — Appeal dismissed
The appellant purchased a mining licence that had originally been granted by the minister of energy in 1990, pursuant to section 69 of the Mining Act 1971. Section 77 of the 1971 Act provided that such a licence would remain in force for 42 years after the date of grant, or for such shorter period as might be specified in the licence, following which the licensee “shall have the right in priority over every other person to have granted to him a new mining licence”. The appellant’s licence was for a specified 10-year period expiring in November 2000, this having been a condition (condition 21) of obtaining the necessary consent of the minister of conservation. Substantial legislative changes were made to the mining regime by the Crown Minerals Act 1991, although section 107(1)(a) of that Act made provision for the continuation of existing rights.
The appellant made an application, under section 103D(3) of the 1971 Act, to vary the conditions of the licence to extend its term to 42 years. It also applied for a renewal of the licence under section 77(2). In judicial review proceedings relating to those applications, issues arose as to whether: (i) section 103D(3) permitted the term of a licence to be varied; (ii) the appellant had a priority right to be granted a new licence; and (iii) that right, if it existed, had been preserved by the transitional provisions of the 1991 Act. The judge at first instance held that there was power to consider the application for variation, including variation as to term, but no power to grant a new licence. The appeal court overturned that finding, holding that there was no power to vary the licence under the terms of section 103D(3). The appellant appealed.
Held: The appeal was dismissed.
1. In specifying a term of 10 years, the grantor was not imposing a condition on the grant, but was simply defining the terms of the licence that he was granting. Condition 21 was merely a condition of obtaining the minister of conservation’s consent to that grant. Condition 21 contained nothing with which the licensee had to comply and, hence, nothing that became a condition of the grant. Accordingly, it did not operate so as to turn the term of 10 years into a condition of the licence that could be varied under section 103D(3): Tasman Gold Development Ltd v Minister of Energy (1985) 5 NZAR 129 considered.
2. Section 77(2) did not give the appellant, as the holder of an existing mining licence, an absolute right to be granted a new licence; it was simply a priority provision. It proceeded upon the basis that the minister would deal with the existing licence holder’s application for a new licence under section 69, which gave the minister discretion as to whether to grant it. If, in the exercise of that discretion, the minister decided to grant a mining licence for the land in question, that licence had to be granted to the existing licence holder in priority to any other person. That conclusion was supported by section 104A of the 1971 Act, which provided that the minister could, at any time, decline any application for a mining privilege.
Accordingly, the appellant did not have the rights that it claimed under either section 103D(3) or section 77(2) of the 1971 Act, and it was unnecessary to consider the effect of the 1991 Act.
William Wilson QC and Shaun O’Neill (both of the New Zealand Bar) appeared for the appellant; Karen Clark and Bronwyn Arthur (both of the New Zealand Bar) represented the first respondent; Paul Walker QC and Christopher Finlayson represented the second respondent.
Sally Dobson, barrister
