MINERALS IN CROWN LANDS

Taranaki Daily News, Volume LII, Issue 77, 27 April 1909, Page 4

MINERALS IN CROWN LANDS

SUPREME COURT JUDGMENT. His Honour Mr. Justice Chapman has delivered the following judgment in the case of the Commissioner ol Crown Lauds fur the Laud District ol Taranaki (plaintiff) v. John Blackball Bonnie (defendant), an originating summons for Hie interpretation of a section of tne Laud Act 1908, heard at thc last sitting of the Supreme Court at New Plymouth.

. "By a deed of lease made March 15, 1904, His Majesty the King demised to the defendant, j'ohn Blaeknall Uennie, all that piece or parcel of land being heavy hush land duly set apart under and subject to the provisions of section 2 of the Bush and Swamp Crown Lands ( Settlement Act 1903, containing 244 acres and being section eiglilccn (18), block nine (1\) Ohura survey district, in the land district of Taranaki for. a' term of 909 years. The lease purports to be a lease in perpetuity under section 121, part 111 of the Land Act 1892, section 19 of the Mining Act, 1898, and its amendments, and section 2 of the Bush and Swamp Crown Lands Settlement Act 1903. These statutory provisions arc incorporated in the lease and' there are special provisions in the following terms: "And it is hereby further declared that the lessee shall have no right or claim to any of the mill erals, metals or valuable stones under tlie surface of 'the land hereby granted and the lessee's rights are limited to tlie surface soil comprised in his lease; and also that all persons lawfully engaged in working such minerals, metals, stone, etc., shall have the right to sink 'shafts under or through the land and to take the water courses over the same, and the right of ingress, egress and regress.' "The lease was granted under section 121 of The Land Act BIOS, now represented bv section 135 of the Land Act 1908. The reservations in the lease are valid statutory reservations neeessaiilv made because thev are contained in section 121 of The Land Act 1892. If I there is any defect in the covenant reserving them it is because it does not extend in terms to the whole of the subjects enumerated in the section. They arc, however, substantially speaking, sufficiently reserved. "As the lease thus stood the defendant was lessee of the land and from his lease the minerals were wholly excepted and might be alienated to someone else by the Crown. The land might therefore be said notionally at least to Individed by horizontal 'boundaries as ill 'The' Earl of Cardigan v. Armitage, 2 B. and C. 197.'

"Matters remained in this position until KIO7 when the passing of Tlio Lund Laws 'Amendment Act 1!H»7 made concessions t(i lessees of tliis class wliieli it is important should lie considered together. Bv section 10 now represented by section" 11)1 of the Lund Act HUM, such lessee limy pay oil' to the Crown ninety per cent, of the capital value of his leasehold. This enables him to hold the land free from all the covenants except that as to the payment of rent, and that as to residing on the land .but the lease remains a lease and the reservation of the minerals remains in force. '•The other concession is contained m section 20, now represented by section 177 of the Act of 1008. This gives the lessee the right to purchase the fee simple of the land and is in the following terms:—Section 177 (1). 'The owner of a lease in perpetuity shall have a right at any time hereafter during the existence of the lease to purchase the fee simple of the land comprised in the lease at a price equal tothe capital value of the said hind at the time of the -purchase thereof. (2). The said capital value shall be determined by valuation or arbitration in the manner provided in this section and shall include the value of all minerals other than gold and silver, but shall not include the value of any improvements placed on the land during the continuance of the lease.' The rest of the .section consists of the machinery for valuing the land, except subsection 10 which runs: 'On the completion »t such inirchase the lease shall determine, but the fee simple so purchased shall he subject to any right, title, interest or incumbrance which is vested in any person other tlian the lessee, and by which at the time of such completion the lease is uH'eetcd.' It is this section that gives rise to the question raised in this action. I have carefully considered whether it w : :is intended to cn-i----line the right of purchase to the land held under the lease, that is the surface only, excluding all valuable minerals.. In the face of subsection 2. however, it is in my opinion, impossible so to.read the section. AVhut lias to be valued is the capital value of the land including all minerals excepting gold and silver. This must be read in the every day popular sense. There is. no oilier mode of valuing the land anil there can only be one valuation. In the result a man claiming to exercise Ibis option must bear in mind that he may be called upon to pay twice as much for the agricultural land as the value in respect of which the rent payable under the lease is calculated, and mi additional sum for" minerals. He has the matter, however, in his own hands. The policy of the Mate to reserve the minerals does not extend to land thus converted into freehold any more than to land sold for cash in the ordinary way. This, 1 think, is con'lirmed'by subsection JO, which 1 assume, would cover a case where the Crown had alienated the minerals to a third person and would secure bis rights. •'The answers to the questions put in the summons will therefor,, be that the lessee is entitled to purchase the fee simple of the land in the fullest sense, including all minerals other than gold and silver, at a valuation to be made under the Act. The order for costs will be as agreed." llr. T. S. Weston was counsel for the Commissioner, and .Mr. T. M'Yoagh for the defendant.