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[1973] HCA 6
High Court of Australia
1973-04-09
Stephen JJ
Original judgment source is linked above.
High Court of Australia Barwick C.J. Menzies, Walsh, Gibbs and Stephen JJ. Adamson v Hayes [1973] HCA 6
ORDER Appeal allowed with costs. Order of the Supreme Court of Western Australia set aside and in lieu thereof order that judgment be entered for the defendants upon the plaintiffs' claims for specific performance. Action remitted to the Supreme Court for consideration of any other issue in this action upon the application of either party.
In an action in the Supreme Court of Western Australia for specific performance of oral agreements between the respondents who were plaintiffs in the suit and the appellants who were defendants, the Supreme Court found that it was orally agreed on 3rd December 1970 between the first and second-named respondents on the one hand and the first, second, third and fourth-named appellants on the other:
(a) that as between themselves certain mineral claims should be held by them in the following shares, namely, as to forty-four per centum for the first and second respondents and as to fifty-six per centum for the appellants; (b) that subject to sub-par. (c) the appellants out of their interest in the said mineral claims should offer to Western Titanium N.L. an option to acquire a fifty per centum interest in the said claims upon the following terms: (i) the option period to extend from 1st January 1971 until 30th April 1971; (ii) the consideration for the option to be the sum of $60,000; (iii) all information gained by Western Titanium N.L. in relation to the said claims during the option period to be made available to the first and second respondents monthly; (iv) the purchase price to be $500,000 payable upon the exercise of the option together with one half of one per centum of the f.o.b. value of all ore produced from the said claims (by which all parties meant, and all parties understood to mean one half of one per centum of the f.o.b. value of all minerals produced from the claims). (c) that the terms of the said option save and except those referred to in sub-par. (b) (i) to (iv) should be subject to the prior approval thereof by the first and second respondents and further subject to prior agreement being reached between Western Titanium N.L. and the first and second respondents for the exploration and, if warranted, development of the said claims, such agreement to be upon such terms as the first and second respondents might require; (d) that if no agreement as referred to in sub-par. (c) was concluded between Western Titanium N.L. and the first and second respondents then the appellants would grant to the first and second respondents or to their nominees an option to acquire the said fifty per centum interest in the claims on the same terms as the offer to Western Titanium N.L. set out in sub-par. (b) (i) to (iv) hereof provided however that if within fourteen days from 3rd December 1970 the first and second respondents or the persons nominated by them did not enter into an option on the foregoing terms then the first and second respondents would be required to reach an agreement with Western Titanium N.L. for the exploration and development of the claims and to consent to an option being granted to that company by the appellants upon the terms of the offer set out in sub-par. (b) (i) to (iv); (e) that the first and second respondents should have an option exercisable within fourteen days of the exercise of the option by Western Titanium N.L. (or by such other party as the option might be granted to) of acquiring from the appellants for the purchase price of $70,000 their remaining six per centum interest in the said claims thereby increasing the first and second respondents' interests in the said claims to fifty per centum; (f) that in the event of the respondents' nominee not exercising the option lastly mentioned, the appellants were to have an unrestricted right to sell their interest to whomsoever they pleased.
By 24th December 1970 the respondents had not been able to make suitable arrangements with Western Titanium N.L. for the development of the mineral claims and, accordingly, nominated the third-named respondent to take an option to acquire a fifty per centum interest in the claims on the same terms as those proposed for Western Titanium N.L. On that date the respondent company informed the appellants in writing that they exercised the option to acquire the fifty per centum interest and forwarded to the appellants two cheques, one for $60,000 as the consideration for the option and the other for $500,000 as the consideration payable on the exercise of the option. At the same time the other respondents gave notice of their exercise of the option to acquire the remaining six per centum of the mining claims and forwarded to the appellants a cheque for $70,000 being the consideration payable on the exercise of the option. On the same day the cheques were returned to the respective respondents by one of the appellants on behalf of all of them. The Supreme Court found that the appellants then and there refused to accept the respondents' nomination of the third respondent and refused to grant it an option on the same terms as those proposed for Western Titanium N.L. and that this refusal was for one reason only, namely, that the appellants (as they claimed) had not given the respondents the right to nominate a purchaser of the fifty per centum of the claims without the approval of the nominee by the appellants. The Supreme Court found that in fact it was not a term of the agreement that the appellants should be able to approve or disapprove the respondents' nominee-purchaser.
The Supreme Court, therefore, decided that, subject to special defences to which reference must be made, the respondents were entitled to the relief claimed, namely, specific performance of the agreement to grant an option to the third respondent as the nominee of the first and second respondents on the terms set out in the agreement, except that the time limit was changed to a period of four calendar months from the date of the order of the Court.
On consideration of the special defences the Supreme Court found that they had not been made out and accordingly ordered the specific performance of the agreement to grant an option to the respondents' nominees and of the agreement to grant an option to the first and second respondents on the terms set out in sub-par. (e) above within fourteen days of the exercise of the option referred to in the before-mentioned order.
The special defences which were raised in the suit and with which this appeal is exclusively concerned are as follows, namely, that the mineral claims are "land" as defined in the Property Law Act, 1969 W.A. and that the oral agreement to which I have referred is void and of no effect or alternatively unenforceable by reason of the provisions of s. 34 of the Property Law Act; and, further, that there was no memorandum or note in writing of the agreement as required by the fourth section of the Statute of Frauds.
Section 34 (1) (a) of the Property Law Act provides that:
no interest in land is capable of being created or disposed of except by writing signed by the person creating or conveying the interest, or by his agent thereunto lawfully authorised in writing, or by will, or by operation of law. As defined by s. 7, "land" includes: land of any tenure and mines and minerals whether or not they are held apart from the surface of the land, a building or part of a building, whether the division of the building is horizontal, vertical or made in any other way, and other corporeal hereditaments, and also includes a rent and other incorporeal hereditaments and an easement, right, privilege or benefit in, over or derived from the land and an individed share in land. Mines and minerals are defined to include: Any strata or seam of minerals or substances in or under any land and the right to work and get the minerals and substances.
The Supreme Court held that the mineral claims were not land for the purposes of s. 4 of the Statute of Frauds. The Court also held that the agreement between the parties did not create or convey an interest in land.
The claims to which the agreement referred had arisen by the exercise of various miner's rights taken out by the appellants and by the first and second respondents chiefly with respect to Crown land though some of the claims were either wholly or in part on private land. Some of the claims were said to have been taken possession of on behalf of persons other than the holders of the miner's rights as well as on behalf of those holders. Prior to the making of the agreement, the appellants and the respondents, in some instances solely and in other instances jointly, had pegged out areas of Crown land in conformity with the provisions of the Mining Act, 1904-1971 W.A. (the Act) (see Pt IV) pursuant to the said miner's rights.
(1) to take possession of, mine and occupy Crown land for mining purposes;
(2) to take possession of and occupy Crown land as an authorised holding;
(10) to take possession of and occupy, with the approval of the warden as to locality, the surface of any Crown land, not exceeding one acre, for the purpose of residence or business; but no locality within three miles from the nearest municipality or townsite shall be approved by the warden without the consent in writing of the Minister;
(11) to take possession of and occupy, for residence or business, such portion of the surface of any Crown land as may be reserved or specially set apart for such purpose, and open to selection.
(1) Any person taking up and occupying Crown land by virtue of a miner's right shall, subject to the provisions of this Act and the regulations, be deemed in law to be possessed (except as against His Majesty) of such land so taken up and occupied; and
(2) All gold and minerals found upon any land so taken up and occupied for the purpose of mining for gold, and all minerals found upon any land so taken up and occupied for the purpose of mining for minerals, shall be the absolute property of the holder of such miner's right in lawful occupation of such land.
(a) to recover possession of any claim or authorised holding or any share or interest therein; or
(b) to recover damages for, or to restrain the occupation of, or encroachment upon any such claim or authorised holding or any part thereof; or
(c) to obtain any relief in respect of any claim or authorised holding as joint tenant, tenant in common, co-partner, or co-adventurer against his joint tenant, tenant in common, co-partner, or co-adventurer;
unless such person is the holder of a miner's right:
Provided that this section shall not extend or apply to a beneficiary who seeks to enforce the fulfilment of a trust with respect to any such claim or authorised holding.
By s. 3 of the Act a "claim" is defined as: the portion of land which any miner shall lawfully have taken possession of and be entitled to occupy for mining purposes, or any number of such portions lawfully amalgamated; but no land comprised in any mining lease, or in any application therefor, shall be deemed to be a claim. "Mining tenement" is defined as: any land applied for, held, occupied, used, or enjoyed under a lease or application therefor, or as a claim, or any area, water race, drain, dam, or reservoir; any stack or accumulation of earth containing gold or any other mineral; or any easement taken up, held, occupied, used, or enjoyed under or by virtue of a miner's right. "Owner" is defined as: the holder of any mining tenement, or any sub-lessee of any such tenement, or any person in possession of such tenement with the consent of the holder.
The provisions of the Act with respect to mining on private lands are to be found in Pt VII. In the case of private land, s. 146 provides that "the holder of a miner's right who desires to search upon private land either for gold or any mineral, or to mark out a mining lease or claim may make application, in writing, to the warden for a permit to enter upon the land". Section 154 provides that "application for a claim of private land shall be made in the same manner as for a mining lease or claim of Crown land " No more need be said about the claims in this case in so far as they were related to private land for it is quite clear that no steps had been taken in accordance with the Act, either at the time of the making of the agreement, or, for that matter, up to the commencement of the suit to obtain a permit to enter upon the private land which was to be the subject of a claim. Nothing more had been done beyond pegging the area on the private land, an activity which in relation to private land does not result in a claim. The claims with which we have to deal are, thus, claims to areas of Crown land.
Every mining tenement, and every share and interest therein, shall be deemed and taken in law to be a chattel interest, and, subject to this Act and the regulations, the holder may transfer and encumber the same:
But no person shall acquire any interest under any transfer of a mining tenement held under a miner's right, unless such person is the holder of a miner's right.
Section 274 of the Act provides: Every mining tenement, and every share and interest therein, shall, on the death or bankruptcy of the holder thereof, devolve on his personal representative or trustee in bankruptcy or liquidator, and shall be liable to seizure and sale under any execution issued from the Supreme Court, or any warden's court, local court, or other court.
The sheriff or other officer appointed to sell the same shall have full power to give an effectual transfer thereof.
Section 287 of the Act provides: No contract relating to any mining lease or application therefor, or any share or interest therein respectively, shall be enforceable by any action or other legal proceeding unless some note or memorandum in writing of the contract is made and signed by the party to be charged, or his agent authorised in writing in that behalf.
Four principal questions discussed in the hearing of the appeal were, first, whether the provisions of the Act, particularly s. 273, precluded the definition of the Property Law Act of "land" encompassing a mining tenement of any kind and particularly a claim over Crown land; secondly, whether, if mining claims over Crown lands constituted interests in land, the agreement found to have been made in the circumstances in which it was made did amount to the creation or disposal of an interest in land; thirdly, whether, in any case, the interest of the owner of a mining tenement being a claim derived from the exercise of a miner's right on Crown land was an interest in land either within the meaning of the Property Law Act or at all; and, fourthly, whether ss. 273 and 287 of the Act precluded the operation of s. 4 of the Statute of Frauds, even if apart from those sections the mining claims ought properly to be regarded as interests in land.
The parties pegged some areas individually and other areas jointly between some two or more of them. As I have said, some of the parties purported to hold claims on behalf of others. Apparently the areas were contiguous, or at any rate capable of being worked together. It is, in my opinion, most important to observe that the appellants' only interest in pegging any areas, and in encouraging the respondents also to do so, was to sell the claims to some mining organization interested to work or develop them. The respondents, on the other hand, desired to participate in the exploitation of the claims. To forward their several purposes the parties agreed to regard the claims as if they constituted a single area and each group, the appellants on the one hand and the respondents on the other, as entitled to an agreed percentage of the whole. It was this step in the arrangements between them which formed the basis of the appellants' resistance to a decree for specific performance should the arrangement alleged by the respondents be found to have been made. It was said that the oral agreement to hold the total of the claims in stated shares was, or at least involved, the transfer or the creation of an interest in land and because of s. 34 (1) of the Property Law Act was ineffective to do so. Alternatively, it was said that the arrangement fell within s. 4 of the Statute of Frauds, still operative in Western Australia, and was, therefore, unenforceable for want of a memorandum in writing.
The Supreme Court was of opinion that the agreement between the parties which it found they had made did not involve the transfer of any interest in the claims from one individual to any other individual or group; and for that reason s. 34 (1) of the Property Law Act did not affect the validity of the transaction. The Court was of the opinion that, having regard to ss. 273 and 287 of the Act, the claims were not interests in land. Consequently, the absence of writing did not prevent the enforcement of the parties' arrangement.
In my opinion, the Supreme Court was right in its conclusion. In my opinion, the arrangement between the parties did not involve any immediate creation or transfer of any interest in a mining claim from one of the parties to any other of them or indeed any present change at all in the interest of any person in any one or more of the mining claims. As I have indicated, the parties were not minded to work the claims together. They intended to find an associate with whom the respondents could work the claims when amalgamated into one area or made the subject of a mineral lease. The interests of the newcomer and the respondents in the venture were to be equal. To achieve this purpose the appellants were to have the first opportunity to find a purchaser of part of the interest they were regarded as between the parties and for the purpose of their arrangement as having in the claims as a whole. Failing the finding by the appellants of such a purchaser the respondents were to be at liberty to do so. On a partner being found with whom the respondents could work, the appellants were to sell the balance of that interest to the respondents so that the respondents' interest in the claims as a whole would be equal to that of the newcomer. There was, in my opinion, no intention to change the ownership in the individual claims, legal or beneficial, until it was necessary to implement the arrangements made with the partner with whom the respondents were to work in the development of the claims. For example, the appellants, in my opinion, could not have called upon the respondents to transfer to them or any of them any claims or any interest in any of the claims except as part of the performance of the arrangements for the creation of a mining partnership in which the respondents would be equal partners, see s. 282 (2) of the Act. Thus, the parties' arrangement did not involve, in my opinion, the transfer of any interest in any specific claim nor, in my opinion, the creation of any interest in any specific claim. What it did involve was mutual promises to join in any necessary instruments or procedures required to implement a transfer of the appellants' interest as a percentage of all the claims regarded as a unit to the partnership of the respondents when formed. The claims, of course, could become such a unit by consolidation or by the grant of a mineral lease under the Act; as to consolidation, see ss. 18, 19 and 20. Thus, in my opinion, the mutual promises included promises, if required, to join in all necessary steps under the Act to consolidate the claims or to make application for mineral leases to be issued to one or more of the partners in the enterprise of exploiting the claims. Each claim depended on the continued existence of a miner's right in the person who had pegged the land, see s. 41. A miner's right itself is not transferable, but a claim as a mining tenement is transferable to a person who holds a miner's right. However, the Act recognized the possibility of the existence of a trust with respect to a claim, see s. 40. Though seemingly some claims were held on trust, I do not think the parties' arrangement called for any variation of such trusts until the partner had been found and a mining partnership was to be formed.
I am further of opinion that, in any case, the claim arising in relation to Crown land by the exercise of a miner's right is not an interest in land, either as defined by the Property Law Act or under the general law. The possession of a miner's right entitles its holder to take possession of, occupy for mining purposes and mine, Crown land which has become a claim. Having taken possession of an area of land pursuant to the miner's right the holder of the miner's right is, by s. 31 of the Act, deemed to be possessed of the land, except as against the Crown, and is entitled to all the minerals found by him on the land, of which possession is so taken. The area of land of which the holder of the miner's right is deemed to be possessed is defined as a claim and is a mining tenement for the purposes of the Act. However, the Act is emphatic that neither the grant of a miner's right nor its exercise gives any right or interest in Crown land to the holder of the miner's right who becomes the owner of the claim. Section 34 precludes the acquisition by virtue of the miner's right of any right in the land as against the Crown. As already mentioned, s. 31 deems the person taking up or occupying Crown land by virtue of a miner's right to be possessed, except against the Crown, of the land so taken up and occupied. This deemed possession would give to the owner of the claim derived from the exercise of the miner's right the capacity to protect himself against any trespass or attempted dispossession by any person other than the Crown. It is by this mechanism rather than by the creation of any actual estate or interest in the land that the Act provides the owner of the claim with security adequate for the furtherance of his mining activity.
These provisions are fortified by s. 273 which requires all mining tenements and shares and interests therein to be taken in law to be chattel interests. It was argued that this meant chattels real. But two reasons, it seems to me, answer that contention. First of all, a claim in relation to Crown land is, as I have indicated, not an interest in land. A claim is a mining tenement. It would be strange to regard s. 273 as converting it into a form of realty. Secondly, a mining lease is also a mining tenement. A leasehold is an instance of a chattel real. Thus, if the chattel interest to which s. 273 refers is interpreted as being a chattel real, it is otiose so far as mining leases are concerned and at the same time reverses the evident policy of ss. 31 and 34. In my opinion, the chattel interests which the mining tenements are by s. 273 declared to be, are personal interests and not real interests. Such a construction is consonant, in my opinion, with the policy of the Act.
The definition of land in the Property Law Act includes not only land of any tenure but "mines and minerals whether or not they are held apart from the surface of the land". Mines and minerals are defined as including "any strata or seam of minerals or substances in or under any land and the right to work and get the minerals and substances". The holder of the miner's right, having taken possession of an area of land which becomes in relation to Crown land a claim, is entitled by virtue of s. 26 of the Act to mine that land. But, in my opinion, that statutory entitlement is not a right to work and get the minerals and substances as I think that expression should be understood within the definition of mines and minerals in the Property Law Act.
In the first place, to be land within the definition of "land" in that Act, the mines and minerals must be "held" either along with the surface or as strata or seams in or under the land; that is to say, they must be the subject of some tenure. "The right to work and get the minerals and substances" in the definition of mines and minerals is not, in my opinion, an additional category of land within the definition of land, but is referred to in the definition of mines and minerals as a concomitant of the holding or tenure of strata or seams of minerals or substances. It is the right to mine the minerals or substances of which the definition of mines and minerals speaks. It does not refer to a right to mine generally or as a right independent of the tenure of mines and minerals. Thus, in my opinion, the only extension of the definition of land effected by the words "mines and minerals", whether or not they are held apart from the surface of the land, is the inclusion of instances where strata or seams are the subject of some tenure including a tenure which carries with it the right to mine the mines or minerals so held. Clearly the right given by s. 26 is not a tenure of any land.
In the second place, whilst the holder of the miner's right who has pegged the claim has a statutory right to mine the area of land of which it consists the claim itself will not be a right to mine. I am unable to regard the statutory right of the holder of a miner's right to mine the claim as a "right to work and get the minerals and substances" within the meaning of the Property Law Act. Thus, even if contrary to my already expressed opinion, a right to mine unconnected with a tenure of a strata or seam of minerals or substances is imported into the definition of land by the definition of mines and minerals in the Property Law Act, the statutory right to mine given by s. 26 of the Act is not such a right as could properly be regarded as included in the definition of land in the Property Law Act.
A tenure of a strata or seam of minerals or substances bears enough similarity to land to be included in a definition of land whereas a mere right or licence to mine an area of land has no such similarity. Further, it is the clear policy of the Mining Act not to treat the right given by s. 26 to the holder of a miner's right to mine the claim as land or an interest in land. The conclusion to which I have come as to the meaning of the definition of land in relation to the right to mine makes the relevant provisions of the two Acts, the Property Law Act and the Mining Act, quite consistent. It seems to me that it would be wrong to attribute to the legislature an intention in a general Act such as the Property Law Act and, particularly through such a definition as that of land and mines and minerals, to reverse the policy of the Mining Act, itself a special piece of legislation. Mere subsequence in time is not enough to warrant such a conclusion.
Further, the subject matters of the parties' arrangement were not mines or minerals or the right to mine mines or minerals; they were mining claims, that is to say, areas of land upon which by dint of the holding of a miner's right and the Act that holder could mine. The new owner of the claims must hold a miner's right. By the possession of the miner's right and the transfer of the claim, the transferee would have the right to mine the claim which would derive from the Act. Of course, the holder of the miner's right was entitled to the ownership of extracted minerals, but the minerals will not themselves be land; they will only be land under the Property Law Act if the subject of a tenure. As I have said, quite clearly in my opinion neither s. 26 nor the pegging of an area as a claim creates a tenure of the mines or minerals, in or under the land.
Therefore, in my opinion, neither the area of land which is a claim nor the statutory right to mine it granted by the Act could be land either having regard to the provisions of the Act to which I have called attention or under the provisions of the Property Law Act which I have mentioned.
This conclusion answers the submission based on s. 4 of the Statute of Frauds. But, in addition, I agree with the Supreme Court that a proper implication from the terms of s. 287 is that the legislature did not consider a mining claim on Crown land to be land or to be within the Statute of Frauds. Section 287 was necessary because all mining tenements had been deemed chattels personal by s. 273. But s. 287 in its terms did not embrace a mining claim.
An objection was raised to the form of the decree made by the Supreme Court, in that it fixed a date for the exercise of the option to be given in pursuance of the provisions which the decree specifically enforces. However, in the first place, the respondent company had purported to exercise the option and, in the second place, on the footing that the option had not been exercised and the contractual time for its exercise had expired, it was quite proper to fix a time within which the option should be exercised.
In my opinion, therefore, the orders made by the Supreme Court were rightly made. This appeal should be dismissed.
Although this appeal does relate to other matters as well, it is, in the main, concerned with the effect of two statutes of the State of Western Australia - the Mining Act, 1904-1968 and the Property Law Act, 1969 - and their effect upon what the parties did in relation to one another. The relevant provisions of the two statutes and the details of what was done are set out in the judgments of the Chief Justice and Stephen J. and it is not necessary for me to repeat what has already been fully stated.
The problem is the enforceability of an agreement relating to mining claims which was found to have been made orally by or on behalf of the parties on 3rd December 1970. The finding in the Supreme Court established the making of the agreement and its terms. The appellant contests its enforceability by reason of s. 34 (1) of the Property Law Act and the Statute of Frauds.
In or about September 1970, Adamson, Hayes and Freebairn, all of whom hold mining rights issued under the Mining Act, between them pegged out in all twenty claims on Crown land and one claim partly on Crown land and partly on private land at Eneabba in Western Australia. There were also claims pegged out on private land but these can be disregarded. By virtue of what was done, areas of Crown land were taken up and occupied and were, in law, deemed to be possessed - except as against Her Majesty - by the particular claimant or claimants making the various claims. These claimants, however, from the first did not hold their claims entirely for themselves. Most, if not all, were held beneficially for other persons as well. In short, the claims were held subject to trusts. Later, it was agreed orally by or on behalf of all concerned - and this is the agreement with which the action is concerned - that all the claims should be held by the actual claimant or claimants as to forty-four per centum for Hayes and Freebairn, and as to fifty-six per centum for Adamson and his family group. In due course, Hayes and Freebairn became the first and second-named plaintiffs in the action against the Adamson family group seeking its enforcement. The agreement which was made contained other terms, some of which explain how it is that the third-named plaintiff became a party to the proceedings. These further terms I can disregard, for the first question, as it seems to me, is whether the foregoing agreement, pooling the claims in the manner described, is unenforceable by reason of s. 34 (1) of the Property Law Act because it was not in writing and signed as therein provided: if it is, that concludes the matter in favour of the appellants.
I am not disposed to regard s. 34 (1) (a) as applicable because, although expressed with great generality, its operation ought, in the light of the provisions of ss. 34 (1) (b) and (c), to be confined to the creation or disposal of legal interests. If it were to apply to equitable interests, it seems to me that (b) and (c) would not have been necessary. As the pooling agreement did not affect legal interests, the critical problem for me is whether s. 34 (1) (b) or (c) applies to render it unenforceable. The former applies only if the pooling agreement comprehended (i) a declaration of trust, and (ii) such a declaration respecting land or an interest therein. The latter applies only if the pooling agreement effected some disposition of equitable interests in land for, although not so expressed, I do read s. 34 (1) (c) as limited to interests in land.
Did, then, the claimants, as part of the pooling agreement declare trusts? As I have said, the claims were held upon trusts before the pooling arrangement was made and it was an essential part of that arrangement that new trusts should be substituted for the old trusts. I am disposed to think that this did involve declarations of trust for it was the agreement of all persons interested that the old trusts should be replaced by the new. The acceptance of the new trusts involved new declarations of trust by the claimants to replace existing trusts. If it were the case that before the pooling agreement, some claims were held by one or more claimants not subject to any trust in favour of other persons, the pooling agreement in relation to such claims was clearly enough a declaration of trust.
If, however, the pooling agreement did not involve the declaration of trusts in relation to each claim, it did amount to a disposition of equitable interests by the former beneficiaries to the new beneficiaries, for it seems to me that its effect was to alter equitable rights in the claims. Its leading provision, which was intended to operate immediately was as found that as between the parties the various claims should be held "in the following shares, namely as to forty-four per centum for the first and second plaintiffs and as to fifty-six per centum for the defendants". Accordingly, these new trusts established by the pooling agreement did amount either to declarations of trust or the disposition of equitable interests in each and every claim which it covered.
It is my opinion, therefore, that s. 34 (1) (b) or (c) was applicable to the pooling agreement if the trusts to which the claims became subject, either by declaration or by disposition, were of interests in land.
To determine whether or not the claims amounted to interests in land for the purpose of s. 34, it is necessary to go first to the definitions in s. 7 of the Property Law Act itself, for if s. 34, upon its proper construction, does comprehend mining claims as interests in land, it matters not that in the Mining Act itself such claims are not constituted as interests in land. In other words, it is s. 34 of the Property Law Act that must be construed and applied according to its proper construction to determine whether it applies to mining claims, for the purposes of that Act. The definitions in s. 7 require consideration: first, the definition of land which is, so far as relevant, as follows:
"Land" includes land of any tenure and mines and minerals whether or not they are held apart from the surface of the land, Secondly, the definition of mines and minerals is as follows: "Mines and minerals" include any strata or seam of minerals or substances in or under any land and the right to work and get the minerals and substances. I agree with Stephen J. that these definitions must be combined because of the reference in the definition of land to "mines and minerals" and that the combination produces the following result: "Land" includes land of any tenure and mines and minerals including any strata or seam of minerals and substances in or under any land and the right to work and get the minerals and substances whether or not they are held apart from the surface of the land
The next inquiry is whether a mining claim falls within this composite definition, and, at this point, it is necessary to refer briefly to some sections of the Mining Act. By s. 3, a claim is defined as:
"Claim" - The portion of land which any miner shall lawfully have taken possession of and be entitled to occupy for mining purposes, or any number of such portions lawfully amalgamated; but no land comprised in any mining lease, or in any application therefor, shall be deemed to be a claim. The holder of any mining tenement is an "owner". By s. 26, the holder of a miner's right is entitled, except as against Her Majesty, to take possession of a mine and to occupy Crown land for mining purposes. A person who does so by virtue of a miner's right is deemed to be in possession of such land, except as against Her Majesty (see s. 31 (1)); and is entitled to mine thereon and to take the minerals found as his absolute property (see s. 31 (2)). Section 273 provides, inter alia, that a mining tenement shall be deemed and taken in law to be a "chattel interest". Section 274 makes a mining tenement a part of the assets of the holder upon death or bankruptcy. These provisions do, I think, establish at least that the owner of a mining tenement by reason of a claim has the right to work and get minerals from the land claimed. Prima facie, therefore, a claim is land as defined by s. 7 of the Property Law Act.
However, against this, it has been urged that s. 273 of the Mining Act requiring a mining tenement to be deemed and taken in law to be a "chattel interest" requires a contrary conclusion. While I do not accept the appellants' argument that a "chattel interest" means "a chattel real interest", I do not regard s. 273 of the Mining Act as controlling what is meant by land in the Property Law Act particularly as the definition of land in that Act - a definition to which I have already referred - covers specifically the right to work the land claimed and get minerals therefrom. Moreover, in the Mining Act itself, it is recognized in the definition section that a mining tenement - which includes a claim - may be land even though s. 273 requires any interest in that land to be treated as "a chattel interest".
Accordingly, it is my opinion that s. 34 of the Property Law Act did apply to render the pooling agreement ineffective and unenforceable. This conclusion disposes of the appeal in favour of the appellants.
The appellants also sought to rely upon s. 4 of the Statute of Frauds. I agree with the reasons given by my brother Walsh that this section does not apply to this agreement.
In my opinion the contention of the appellants that the agreement, in respect of which the respondents obtained a decree for specific performance in the Supreme Court of Western Australia was an agreement which, if effective, would have constituted the creating of new rights and the disposing of existing rights, within the meaning of s. 34 (1) (a) of the Property Law Act, 1969 W.A., should be upheld. I am of opinion, also, that since there was no writing as required by that provision, it operated to make ineffective the intended changes in the respective rights of the appellants and of the first and second respondents. This had the consequence, in my opinion, that specific performance could not properly be granted in respect of the agreement or of any part of it.
The terms of the agreement as found by the learned judge who heard the action are set out in the judgment of Stephen J., which recites also the facts and the statutory provisions that need to be considered in determining whether or not the claims which were the subject matter of the agreement constituted interests in land as defined by the Property Law Act, 1969.
I am in agreement with the reasons given by Stephen J. for concluding that the defined meaning of "land" for the purposes of that Act includes within it the rights conferred by the relevant provisions of the Mining Act, 1904-1968 W.A. upon a person who takes up a mineral claim on Crown land. It is true that the rights conferred by ss. 26 and 31 (1) of that Act do not include any right against the Crown. Whilst those provisions, together with s. 34, may have the effect that the holder of a claim in respect of Crown land is not to be regarded for the purposes of the general law as having an estate or interest in the land, nevertheless the definitions, in s. 3 of the Property Law Act, of "land" and of "mines and minerals" require, in my opinion, the conclusion that the holder of such a claim has an interest in "land" for the purposes of that Act.
I agree, also, with the opinion of Stephen J. that the foregoing conclusion is not displaced by s. 273 of the Mining Act, even if that provision should be construed, as I think it should be, in the sense that the "chattel interest" to which it refers is not an interest in land.
In my opinion, in the agreement between the parties, they intended by the use of the word "claims" to refer to and to deal with the statutory rights which had come into existence, because the parties had pegged out and had become entitled to work and get minerals in the areas of the claims. It seems plain that the agreement was intended to deal with rights which were to be shared in a specified way and of which dispositions were to be made in the manner set out in the agreement.
In my opinion the meaning of that part of the agreement, which was set out in par. 5 (a) of the statement of claim and which may be called the pooling agreement, was that the respective parties were thereafter to be entitled beneficially to each of the claims mentioned (that is, to the set of rights attached to each such claim) in the shares specified. In my opinion, that part of the agreement was intended to take effect immediately. It did not consist of mutual promises that at some subsequent time the claims would be held in the specified manner. It was directed to an immediate settlement of the entitlement to the claims, this being a settlement which would make it possible for the appellants "out of their interest in the said claims" to offer the option described in par. 5 (b) and would permit of the other agreed dealings by the parties with their respective interests in the claims. The shares specified in the pooling agreement did not correspond with the rights which the respective parties would have had under the Mining Act in the absence of any bargain concerning the beneficial ownership of those rights nor did they correspond with any bargain that had previously been made as to such beneficial ownership. In my opinion, this part of the agreement constituted a set of dealings with the equitable interests in the claims. It would have been effective, but for the lack of the writing required by s. 34 (1) (a) of the Property Law Act, to create or to dispose of equitable interests in the claims to which it referred.
I am disposed to think that some other portions of the agreement found to have been made, that is, those portions set out in pars. 5 (d) and 5 (e) of the statement of claim, involved the creating of an interest in "land", as defined in the Property Law Act, in that there was in each of those parts of the bargain an agreement to grant an option which, although it was a conditional agreement, would have given to the first and second respondents an interest in the property to which the agreement referred. It is, however, not necessary to express a final view upon that question.
It was argued that s. 34 (1) (a) had no operation for the reason that it applies only when there is some kind of formal assurance and not when, as it was submitted occurred in this case, there is a mere contract without more. But, in my opinion, it is not correct to say that the rights created by the agreement were mere contractual rights. If it be held, as I think it should be, that the agreement dealt with rights which were interests in "land" as defined, I am of opinion that the conclusion must follow that the agreement was rendered ineffective by s. 34 (1) (a), unless that provision should be construed as applying only to legal interests in land. It was not argued, however, that it should be so construed and it would be difficult to support that construction having regard to s. 33. of the same Act, which makes a deed necessary for the conveying or creating of a legal estate. If s. 34 (1) (a) is taken to apply to the creating and to the disposing of equitable interests there is no reason, in my opinion, for denying its application to an oral agreement by which the parties agree that property shall be held as to the beneficial ownership thereof in certain shares or for holding that it can apply only to an oral statement expressed in the formal language that would be appropriate to a formal conveyance or grant.
A further defence raised at the trial was that there was no memorandum or note in writing of the alleged agreement as required by s. 4 of the Statute of Frauds. In the Supreme Court, it was held that the effect of s. 273 of the Mining Act, which provides (inter alia) that "Every mining tenement, and every share and interest therein, shall be deemed and taken in law to be a chattel interest", is to make s. 4 of the Statute of Frauds inapplicable to any contract, the subject matter of which is a mining tenement or an interest in a mining tenement. Burt J. was of opinion that this view of the effect of s. 273 was reinforced by a consideration of s. 287 of the Mining Act. I am in agreement with his Honour on this question. It was argued in this Court that the "chattel interest" mentioned in s. 273 should be interpreted as being a chattel interest in land and that the purpose of the provision was to require that all interests in mining tenements should be of the nature of chattels real. In my opinion, that argument should not be accepted. The language of the provision is not language that would naturally be used to express that intention. In my opinion, the defence based on s. 4 of the Statute of Frauds was rightly rejected.
As to an alternative defence that it had not been shown that the respondent Allied Minerals N.L. was "a person willing to take an option" in accordance with that part of the agreement set out in par. 6 of the statement of claim, it is sufficient to say that, in my opinion, the learned trial judge was right in holding that that defence failed.
Although the notice of appeal contained a request for a general order that the claim of the plaintiffs against the defendants be dismissed, the arguments addressed to us did not deal with the alternative claims for damages that were included in the statement of claim. In the Supreme Court no order was made disposing of those claims. It appears that in that Court those alternative claims may not have been pressed but, in any event, its decision to grant specific performance made it unnecessary for it to decide whether or not any alternative claim had been sustained. In these circumstances I am of opinion that the orders made by this Court should leave it open to the Supreme Court to dispose of those claims if any party should desire to apply to it for that purpose. It will be for that Court to determine, if any such application should be made, whether or not the evidence already given was sufficient to establish any of the alternative claims and whether or not if any of the parties should desire to lead further evidence it should be permitted to do so.
The facts of this case have been stated in the judgments prepared by the Chief Justice and by my brother Stephen. The agreement made on 3rd December 1970 between the appellants of the one part and the first and second respondents of the other part, as varied on 12th December 1970, may be regarded as containing four main sets of provisions which, so far as they are now material, may be summarized as follows. First, the parties agreed that as between themselves the twenty-two mineral claims in question should be held by them in agreed shares, viz. as to forty-four per cent for the first and second respondents and as to fifty-six per cent for the appellants. Secondly, the appellants agreed to offer to Western Titanium N.L. an option to acquire a fifty per cent interest in the aggregation of the said claims on certain stipulated terms ("the specified terms") and that the other terms of the option were subject to the prior approval of the first and second respondents; the option was subject to prior agreement being reached between Western Titanium N.L. and the first and second respondents as to the exploration and if warranted development of the claims. Thirdly, the appellants agreed that if by 29th December 1970 the first and second respondents had not reached agreement with Western Titanium N.L. as to the matters mentioned, but had nominated a person willing to take an option from the appellants to acquire a fifty per cent interest in the claims upon the specified terms, the appellants would grant to such nominee an option to acquire a fifty per cent interest in the claims. Fourthly, the parties agreed that the first and second respondents should have an option, exercisable within fourteen days of the exercise of the option by the said nominee, of acquiring from the appellants their remaining six per cent interest in the claims.
It was not in contest that no agreement as to the terms of the option and the exploration or development of the claims had been reached between Western Titanium N.L. and the first and second respondents. However, it was submitted on behalf of the appellants that it had not been proved that the third respondent was a person willing to take an option from the appellants upon the specified terms. This contention found little support in the pleadings. The third respondent, as a plaintiff, sought specific performance of the agreement to grant the option on the specified terms. The defence contained the assertion that the appellants were under no agreement or obligation to grant any option to the third respondent but it was not expressly alleged that the third respondent was not willing to take an option. Moreover, par. 10 of the statement of claim (whose allegations were deemed to be admitted) read as follows: "The plaintiffs have at all material times been and are now ready and willing to perform their obligations under the said agreement." The appellants contended that the third respondent had no obligations under the agreement sued on and that par. 10 of the statement of claim had nothing to say as to the willingness of that respondent to take an option. However, before the defence was delivered particulars of par. 10 had been sought and obtained. The request for particulars made by the appellants was in the following terms: "Under paragraph 10: Detail the obligations which the plaintiffs allege they are ready and willing to perform." In response to this request the following particulars were given: "The obligations which the plaintiffs say they are willing to perform are to accept the granting of an option as aforesaid" (which by reference to the preceding paragraph of the particulars can be seen to be an option on the specified terms) "by the defendants to the third plaintiff as nominee of the first and second plaintiffs and the payment by the third plaintiff to the defendants of the sum of $60,000 being the consideration for the said option and the making available by the third plaintiff to the first and second plaintiffs monthly of all information gained by it in relation to the said claims during the option period". It was par. 10 as thus particularized which must be taken to have been admitted. I therefore agree with the learned trial judge that on the pleadings this point was not open to the appellants.
The real question of substance in the appeal is whether the agreement was rendered unenforceable either by s. 4 of the Statute of Frauds, 1677, which still remains in force in Western Australia subject to some immaterial amendments effected by the Law Reform (Statute of Frauds) Act, 1962 W.A., or by s. 34 (1) of the Property Law Act, 1969 W.A. ("the Property Law Act "). Section 4 of the Statute of Frauds provided that no action should be brought whereby to charge any person (inter alia) upon any contract or sale of lands, tenements or hereditaments or any interest in or concerning them, unless the agreement or some memorandum or note thereof be in writing duly signed. Clearly this section will only be applicable if the interest in the claims was an interest in lands. However, by s. 273 of the Mining Act, 1904 W.A., as amended ("the Mining Act ") it is provided (inter alia) that:
Every mining tenement, and every share and interest therein, shall be deemed and taken in law to be a chattel interest, and, subject to this Act and the Regulations, the holder may transfer and encumber the same. By s. 2 "mining tenement" is defined to mean (inter alia): "A land applied for, held, occupied, used, or enjoyed under a lease or application therefor, or as a claim " On behalf of the appellants it was submitted that the intention of s. 273 was that an interest in a mining tenement should be a chattel interest in land (a chattel real) and that s. 4 of the Statute of Frauds would therefore apply to it. There are in my opinion good reasons for rejecting this contention. An interest in a mining tenement would, apart from statute, in any case be an interest in land within the Statute of Frauds: Boyce v. Greene [1] ; Smart v. Jones [2] . This consideration led the Full Court of New South Wales in Williams v. Robinson [3] , to hold that s. 18 of the Mining Act of 1814 N.S.W., which provided that every interest created under the provisions of that Act should be "deemed and taken in law to be a chattel interest", had the effect that the interests referred to were interests in the nature of chattels personal. Darley C.J. said, at p. 40: "It was unnecessary for the section to declare that a lease" i.e. a gold mining lease "was a chattel real. It always was so." A different view was taken in New Zealand in Mason v. McConnochie [4] , where Williams J. held that a share in a mining claim was an interest in land within the Statute of Frauds, notwithstanding a statutory provision similar to that considered in Williams v. Robinson [3] . He found it difficult to accept that the legislature would enact that a thing was to be deemed to be what it was not, and said [5] : The argument on the other side is that if the term "chattel interest" means a chattel interest in real estate, the Legislature has said what there was no need for it to say. But the Legislature frequently says what there is no need for it to say; and if the alternative is either that the Legislature has said what there is no reason for it to say, or that the Legislature has said that a thing shall be something different from what it really is, I have no hesitation in accepting the former conclusion. With all respect, I find this reasoning (which met with some criticism in Miller v. Minister of Mines and Attorney-General [6] ) unconvincing. The word "deemed" is sometimes used "to impose for the purposes of a statute an artificial construction of a word or phrase that would not otherwise prevail": St. Aubyn v. Attorney-General, per Lord Radcliffe [1] . The purpose of s. 273 was clearly to alter what would otherwise have been the position. Any doubt as to the effect of s. 273 is in my opinion removed by the provisions of s. 287 of the Mining Act, which reads as follows: No contract relating to any mining lease or application therefor, or any share or interest therein respectively, shall be enforceable by any action or other legal proceeding unless some note or memorandum in writing of the contract is made and signed by the party to be charged, or his agent authorised in writing in that behalf. If s. 273 had the effect that all mining tenements, including mining leases, were chattels real there would be no need for the provisions of s. 287, whose work would be done by s. 4 of the Statute of Frauds. In my judgment it is clear that the intention of the legislature was that all mining tenements should be deemed to be chattels personal, but that nevertheless contracts relating to some of those mining tenements should not be enforceable unless evidenced by a note or memorandum in writing. Claims are mining tenements within s. 273 but they are not within the provisions of s. 287. They are deemed to be chattels personal and s. 4 of the Statute of Frauds does not apply to them. 1. (1826) Batt. 608. 2. (1864) 15 C.B. (N.S.) 717, at p. 724; 143 E.R. 966, at p. 969. 3. (1891) 12 N.S.W.L.R. (Eq.) 34. 4. (1901) 19 N.Z.L.R. 638. 5. (1891) 12 N.S.W.L.R. (Eq.) 34. 6. (1901) 19 N.Z.L.R., at p. 642. 7. [1961] N.Z.L.R. 820, at p. 837. 8. [1952] A.C. 15, at p. 53.
The question that then arises is whether the agreement falls within s. 34 (1) of the Property Law Act, which reads as follows:
Subject to the provisions hereinafter contained in this Act with respect to the creation of interests in land by parol -
(a) no interest in land is capable of being created or disposed of except by writing signed by the person creating or conveying the interest, or by his agent thereunto lawfully authorised in writing, or by will, or by operation of law;
(b) a declaration of trust respecting any land or any interest therein shall be manifested and proved by writing signed by a person who is able to declare the trust or by his will;
(c) a disposition of an equitable interest or trust subsisting at the time of the disposition shall be in writing signed by the person disposing of the interest, or by his agent thereunto lawfully authorised in writing or by will.
The section is in all material respects the same as s. 53 (1) of the Law of Property Act, 1925 U.K. which re-enacted, with alterations, the provisions of ss. 3, 7, 8 and 9 of the Statute of Frauds. In the United Kingdom statute those provisions of s. 4 of the Statute of Frauds that related to actions brought upon any contract or sale of land were re-enacted in s. 40, but for some unexplained reason the legislature of Western Australia did not take the same course, but allowed the provisions of s. 4, so far as they relate to such actions, to remain in operation. It is contended that this has led in the present case to the somewhat anomalous result that the interests in the mining claims are "land" within the definition contained in s. 7 of the Property Law Act and so within s. 34 (1) (a) and (b), although not "lands" within s. 4 of the Statute of Frauds. The operation of s. 34 (1) (c), on the other hand, is not confined to the disposition of an equitable interest in or trust respecting land; it includes dispositions of equitable interests in or trusts respecting personalty - leading cases on the paragraph concern interests in shares; Grey v. Inland Revenue Commissioners [1] ; Oughtred v. Inland Revenue Commissioners [2] ;Vandervell v. Inland Revenue Commissioners [1] - but the interest or trust must be one subsisting at the time of the disposition. 1. [1960] A.C. 1. 2. [1960] A.C. 206. 3. [1967] 2 A.C. 291.
The first part of the agreement - the pooling arrangement - did not call for any action to be taken by the parties but was preliminary to the provisions which required the grant of options. Some of the persons in whose names the claims were held were beneficially as well as legally entitled to them, but in other cases the legal owner of the claims held them beneficially for himself and others. The intention of the pooling arrangement was that immediately upon its making the appellants should become beneficially entitled to fifty-six per cent and the respondents to forty-four per cent of each claim. I am disposed to think that the pooling arrangement amounted to a declaration of trust which will fall within s. 34 (1) (b) if the interests in the claims are interests in land but I cannot regard it as a disposition of an equitable interest or trust subsisting at the time of the disposition within s. 34 (1) (c). The equitable interests which the parties were intended to possess in the aggregation of the claims (fourteen per cent of the aggregation in the case of each appellant and twenty-two per cent in the case of each of the first and second respondents) did not exist until the agreement created them.
If the remaining material parts of the agreement - those to grant the options - come within s. 34 at all they can in my opinion, be covered only by s. 34 (1) (a). The effect of the grant of an option is well understood. In Commissioner of Taxes (Q.) v. Camphin [2] , it was held that the grant for value of an option to purchase the residue of the term of a lease created in the optionee an equitable interest in the lease, but was not a sale to him of such interest. Latham C.J., with whom the other members of the Court agreed, said [3] :
The result of giving an option for value is that the person to whom the option is given acquires an equitable interest. But this equitable interest has not, in my opinion, been sold to him. The equitable interest is measured by what a court of equity would decree in an action for specific performance. The right of the person who may be called the owner of the option is a right to prevent the owner of the property in question from disposing of it inconsistently with the option, together with a right; if he exercises the option, to compel the owner of the property to carry out the contract which has been made by the exercise of the option. The right of the optionee is a right which has been created by the option, but it is not a right which the owner of the property ever possessed. He has created a new right in the optionee which is a right of property, but he has not transferred to the optionee any right which previously belonged to him as the owner of the property in relation to which the option was given. It follows clearly from this statement that the interests created by the agreement to give the options in the present case were not interests subsisting at the time of the agreement: they were new interests, thereby created. They do not come within s. 34 (1) (c). Nor, in my opinion, is it possible to describe the parts of the agreement by which options are granted as declarations of trust: they are not within s. 34 (1) (b). On the other hand, the agreement to grant the options, if valid, did create interests in the claims. If those interests were interests in land the agreement would in my opinion fall within s. 34 (1) (a). That paragraph in my opinion refers to equitable as well as to legal interests in land; s. 33 (s. 52 of the United Kingdom Act) provides that conveyances of land are void for the purpose of conveying or creating a legal interest unless made by deed and the comparison of that section with s. 34 (1) (a) supports the view that the omission to qualify interest in s. 34 (1) (a) by the word "legal" was deliberate. This construction may lead to some overlapping between par. (a) and the other paragraphs of s. 34 (1), but in any case the provisions of that sub-section seem to overlap. It is true that it would appear that if s. 34 (1) (a) is applied to equitable interests, it will embrace within its terms many contractual provisions that would also fall within s. 4 of the Statute of Frauds. It has been said that the latter section "refers to agreements not operating as an immediate transfer or conveyance of an estate or interest in land, but as contracts to make or execute a grant or transfer, or conveyance, at some subsequent period": Agnew, Treatise on the Statute of Frauds (1876), at p. 138 . Section 34 (1) (a) may now refer both to agreements that operate as immediate transfers and to contracts to transfer in future and may thus cover much of the field already covered by the relevant part of s. 4. However, s. 34 cannot be regarded as merely reproducing the effect of those provisions of the Statute of Frauds which it replaces (see Grey v. Inland Revenue Commissioners [1] ) and in my opinion the provisions of s. 34 (1) (a) must be given their natural meaning, without any inhibition that may be caused by a consideration of their history. It therefore follows that the provisions of the agreement providing for the grant of the options will fall within s. 34 (1) (a) and, being by parol, will be ineffective to create or dispose of any interest in the claims, if interests in claims are interests in land. 1. (1937) 57 C.L.R. 127. 2. (1937) 57 C.L.R., at pp. 133-134. 3. [1960] A.C. 1.
By s. 7 of the Property Law Act "land" includes "land of any tenure and mines and minerals whether or not they are held apart from the surface of the land " and "mines and minerals" include "any strata or seam of minerals or substances in or under any land and the right to work and get the minerals and substances". These definitions are taken, with some alterations, from s. 205 of the Law of Property Act, 1925 U.K.. I need not discuss in detail the provisions of the Mining Act that have been canvassed in other judgments. The holder of a miner's right who has lawfully taken possession of Crown land as a claim is entitled (except as against the Crown) to occupy and mine that land, and all minerals found on that land are his absolute property (ss. 3 (claim) (Fminer), 26, 31). Twenty of the claims in the present case were situated on Crown land and it is unnecessary to consider whether the interests in the two claims not so situated were interests in land. The parties who occupied the claims had "the right to work and get the minerals and substances" in or under the land within the definition of mines and minerals in s. 7 of the Property Law Act. Moreover, that right was held apart from the surface of the land; it was "held" in the sense of owned or enjoyed although not the subject of tenure in the strict sense. The use of the word "tenure" in the definition of land in s. 7 is not in my opinion important in the present case, since "mines and minerals" are to be regarded as "land" whether they are the subject of tenure or not. The interests in the claims on the Crown land therefore come within the definition of "land" in the Property Law Act, unless there is some reason for holding that interests under the Mining Act to which s. 273 applies are not intended to be included within the definition.
Although the application of s. 34 of the Property Law Act to interests to which s. 4 of the Statute of Frauds does not extend may bring about an anomalous result, it does not seem to me to lead to such absurdity as to justify a conclusion that the legislature could not have intended it. Nor in my opinion is it appropriate to apply the rule of construction expressed in the maxim generalia specialibus non derogant with the result that the general provisions of the later statute, the Property Law Act, must be regarded as not intended to derogate from the particular provisions of the earlier Mining Act. The effect of s. 273 of the Mining Act was as I have pointed out, that interests in mining claims under that Act are not interests in lands within the Statute of Frauds, although that was not its only effect, and s. 273 will not be devoid of all significance if mining tenements are held to be land within s. 34. The fact that the provisions of s. 34 did not merely repeat those of the sections of the Statute of Frauds which they replaced, but were different and somewhat wider in their scope, affords some ground for thinking that the legislature intended those new provisions to apply to all cases which came within their terms, literally construed, and I can find nothing in the Act itself which would indicate that the definition of "mines and minerals" was intended to be given a restricted application. Moreover, it seems likely that there would be little practical operation left for that part of the definition of "land" that includes "mines and minerals" if it were construed so as to exclude mining tenements under the Mining Act. The latter statute deals with mining on Crown land and with mining on private land in those cases where the minerals on or under the land belong to the Crown, viz. in the case of all lands alienated in fee on or after 1st January 1899 (s. 138), and it is probable that mining tenements under the Mining Act form a large proportion of the mines in Western Australia. This question of construction is not without difficulty, but I cannot see sufficient justification for departing from the ordinary and natural meaning of the definitions in s. 7 of the Property Law Act, and I have therefore reached the conclusion that interests in claims under the Mining Act are interests in land within s. 34 of the Property Law Act.
As a last resort the respondents submitted that the parties to the agreement had entered into a mining partnership, and that the claims were deemed to be partnership property (s. 282 (2) of the Mining Act) and therefore personalty and not interests in land. This argument is untenable. Clearly the parties to the agreement had no intention of carrying on a business in common; they intended that upon the aggregation of the claims the appellants should sell their entire interest in them before they were worked. There was no partnership.
I hold, therefore, that the agreement, not being in writing, was ineffective to create an equitable interest in the mining claims and that it cannot be specifically enforced. The agreement, however, remains otherwise enforceable because s. 4 of the Statute of Frauds does not apply to it. No argument was addressed to us in respect of the alternative claims for damages included in the statement of claim and it would appear necessary to remit the matter to the Supreme Court to enable those claims to be disposed of, assuming that the respondents wish to pursue them. I am not to be taken as suggesting any view on the sufficiency of the evidence in relation to the issue of damages; that will be for the Supreme Court to consider if the action proceeds.
In 1970 three farmers with properties in the Eneabba district of Western Australia were also interested in the potential mineral resources of the area and at least two of them were the holders of miner's rights issued under the Mining Act 1904-1968.
In September of that year, one of them, the appellant James Rowland Adamson, while prospecting in the Eneabba district, discovered what he believed to be deposits of mineral sand and he thereupon pegged five areas and applied for their registration as mineral claims under the Mining Act in his name and those of the other appellants, female relatives of his.
Learning that a mining concern was also actively engaged in pegging out other mineral claims nearby, he then suggested to the other two local farmers, the respondents Hayes and Freebairn, that they should also peg out as mineral claims certain areas adjacent to his claims which he regarded as likely to contain promising deposits of mineral sands. This they immediately did, pegging out four claims on 12th and 13th September, registration of which was applied for in the name of Hayes, he and Freebairn apparently regarding them as held on behalf of the two of them in equal shares. Soon afterwards, during a period of about a week commencing on about 20th September, all three joined in pegging out five more claims, registration of which was sought in the names of Adamson and Hayes but which they all agreed should be held beneficially as to a one half interest by Adamson or a syndicate comprised of himself and his female relatives and as to the other half by Hayes and Freebairn.
Each of these fourteen claims was pegged out on Crown land and at about this time Hayes and Freebairn also pegged out a further six claims on Crown land and applied for registration in their two names. Soon after the first fourteen claims had been pegged out all three agreed to peg a further claim, partly on privately owned land and partly on Crown land, and this was done by Hayes and Freebairn, registration being applied for in Adamson's name and the earlier agreement as to beneficial entitlement being extended so as to apply to it also. Then, on 6th October, a claim was pegged wholly on privately owned land; the material available on appeal does not disclose by whom it was pegged but it seems that it was sought to be registered in Adamson's name. Shortly afterwards, six more claims were pegged out on privately owned land, it being agreed that registration should be applied for in the names of all three and in the name of the owner of the land and that they be held in certain agreed proportions as between the four of them, in the case of Adamson by himself and the other members of his family syndicate.
By the latter part of 1970 a total of twenty claims had been pegged out wholly on Crown land and Freebairn had undertaken some further exploratory work on these claims, the results of which were encouraging and which he communicated to Adamson. Early in November 1970, after some prior discussions, it was proposed by Adamson to the other two that what was described as a "partnership" be entered into in relation to these twenty mineral claims on Crown land so that they might all be held by the partners in agreed shares, Adamson proposing that his syndicate should have a sixty per cent interest in the claims and Hayes and Freebairn between them a forty per cent interest. It was apparently thought desirable by all concerned that some such arrangement should be made so that the claims might together constitute one "big prospect" rather than a large number of small individual claims.
Before any agreement was come to as to the respective entitlements in the proposed "partnership" it became apparent that, whereas Hayes and Freebairn were interested in obtaining advice from a consultant concerning the value of claims and the best means of exploiting them themselves, Adamson was, on the contrary, more interested in an immediate disposal of his own family syndicate's interest in the claims to some third party.
Adamson took certain preliminary steps to give effect to what he had in mind whereas Hayes and Freebairn independently had the claims inspected by a consultant. Then, towards the end of November, Adamson and Freebairn again discussed the proposed "partnership" but that discussion was inconclusive, Adamson ultimately proposing that his syndicate have a fifty-six per centum interest, the other two sharing a forty-four per centum interest, which proposal Freebairn said that he would discuss with Hayes and take up with Adamson again later. This he did on the following day when discussion centred upon the fact that since Adamson's intention was to dispose of his interest the other two did not wish to find themselves having a minority interest with some third party who might acquire the interest of the Adamson syndicate. Adamson suggested that this could be overcome by permitting Hayes and Freebairn to buy from the Adamson syndicate a further ten per centum interest should that syndicate proceed to sell its interest in the "partnership".
A further inconclusive meeting took place between the three on 28th November but on 3rd December a firm agreement was reached. The terms of that agreement were found by the learned trial judge, Burt J., to have been varied by agreement on 12th December 1970 and he accepted the plaintiffs' pleading of these two oral agreements as accurately describing their terms, his only two qualifications being, first that the agreement of 3rd December was originally restricted to the twenty claims, all on Crown land, and it was only after a few days had passed that, by agreement, it was extended so as also to include the claim pegged partly on Crown land and partly on privately owned land and the one claim pegged on privately owned land on 6th October 1970; thus the agreement thereafter related to a total of twenty-two claims. Secondly, Burt J. found that the agreement of 12th December included a term additional to those pleaded, the details of which are, however, irrelevant for present purposes. There is no appeal from any of these findings of fact.
The two agreements contemplated that in certain eventualities a nominee of Hayes and Freebairn might acquire the Adamson syndicate's interest. The third-named plaintiff, Allied Minerals N.L., was such nominee; hence its presence as a plaintiff on the record. In circumstances not now material the defendants, Adamson and the other members of his family syndicate, refused to perform what the plaintiffs claimed had been agreed upon between them and the plaintiffs successfully sought a decree for specific performance, having also claimed damages in the alternative.
The matters with which this appeal is concerned are limited to two of the defences raised unsuccessfully by the defendants before Burt J. They contended that the two agreements, being oral and there being no note or memorandum capable of being relied upon, were invalid and unenforceable; alternatively, even if valid and enforceable, the terms of the agreements, in so far as they contemplated the nomination by the respondents of a party willing to take an option to acquire from the appellants a substantial proportion of their interest in the mining claims, were not satisfied because the party so nominated, Allied Minerals N.L., was not "willing" as required by the terms of the agreements.
It will be convenient now to set out the two paragraphs of the plaintiffs' statement of claim in which the terms of the agreements are pleaded.
(a) that as between themselves the mineral claims referred to in pars. 1 to 4 hereof "(they being the claims on the Crown land plus Claim 7134H which was partly on Crown land and 7351H which was entirely on private land)" should be held by them in the following shares namely as to forty-four per centum for the first and second plaintiffs and as to fifty-six per centum for the defendants;
(b) that subject to sub-par. (c) hereof the defendants out of their interest in the said mineral claims should offer to Western Titanium N.L. an option to acquire a fifty per centum interest in the said claims upon the following terms namely
(i) the option period to extend from 1st January 1971 until 30th April 1971
(ii) the consideration for the option to be the sum of $60,000
(iii) all information gained by Western Titanium N.L. in relation to the said claims during the option period to be made available to the first and second plaintiffs monthly
(iv) the purchase price to be $500,000 payable upon the exercise of the option together with one half of one per centum of the f.o.b. value of all ore produced from the said claims (by which all parties meant, and all parties understood to mean one half of one per centum of the f.o.b. value of all minerals produced from the claims);
(c) that the terms of the said option save and except those referred to in sub-par. (b) (i) to (iv) hereof should be subject to the prior approval thereof by the first and second plaintiffs and further subject to prior agreement being reached between Western Titanium N.L. and the first and second plaintiffs for the exploration and if warranted development of the said claims such agreement to be upon such terms as the first and second plaintiffs might require;
(d) that if no agreement as referred to in sub-par. (c) hereof was concluded between Western Titanium N.L. and the first and second plaintiffs then the defendants would grant to the first and second plaintiffs or to their nominees an option to acquire the said fifty per centum interest in the claims on the same terms as the offer to Western Titanium N.L. set out in sub-par. (b) (i) to (iv) hereof provided however that if within fourteen days from 3rd December 1970 the first and second plaintiffs or the persons nominated by them did not enter into an option on the foregoing terms then the first and second plaintiffs would be required to reach an agreement with Western Titanium N.L. for the exploration and development of the claims and to consent to an option being granted to that company by the defendants upon the terms of the offer set out in sub-par. (b) (i) to (iv) hereof;
(e) that the first and second plaintiffs should have an option exercisable within fourteen days of the exercise of the option by Western Titanium N.L. (or by such other party as the option might be granted to) of acquiring from the defendants for the purchase price of $70,000 their remaining six per centum interest in the said claims thereby increasing the first and second plaintiffs' interests in the said claims to fifty per centum.
Burt J. further found that the facts alleged in pars. 7, 8 and 9 of the statement of claim had been established and the contents of these paragraphs may also be set out.
The appellants' contentions based upon the oral nature of the agreements involved reliance upon s. 34 of the Property Law Act, 1969 W.A. and upon s. 4 of the Statute of Frauds which is in force in Western Australia in its original form subject only to an immaterial amendment effected by the Law Reform (Statute of Frauds) Act 1962. As a first step towards making good these contentions the appellant must establish that the agreements, in dealing with mineral claims and interests in them, were concerning themselves with "land" within the meaning of these two statutory provisions.
The portion of land which any miner shall lawfully have taken possession of and be entitled to occupy for mining purposes, or any number of such portions lawfully amalgamated; but no land comprised in any mining lease, or in any application therefor, shall be deemed to be a claim. To appreciate what it was that the agreements were dealing with it is, however, necessary to go to other sections of that Act; s. 16 provides for the issue of miner's rights and the holder of a miner's right (a "miner") may, under s. 26 (1) take possession of, mine and occupy Crown land for mining purposes. Once Crown land is taken up and occupied by a miner who has pegged out the area of a claim in accordance with regulations made under the Act the miner is then, by s. 31, deemed in law to be possessed, except as against the Crown, of the land comprised in the claim and all minerals found upon it become his absolute property. This is the extent of the relevant rights involved in a claim and they are only exercisable by the holder of a miner's right; claims and interests in claims may be transferred and encumbered but no person may acquire any interest under the transfer of a claim unless he is the holder of a miner's right - s. 273. A quite detailed procedure for registration of mining tenements, including claims, is provided for by the Act and regulations. A miner may also, under s. 146 of the Act, apply for a permit to search upon private land, thereby initiating a procedure which may result in his obtaining rights over that private land comparable to the rights he may obtain over Crown land; however in the present case, although the agreements do refer to claims on private land, at no material time had that procedure progressed to a stage at which it might be said of the claims on private land that they involved an interest in land.
It is apparent from this short description of the rights conferred on a miner who holds a claim over Crown land that no interest in land is involved in any ordinary sense of that term; the Crown retains unaffected its title to the land the subject of the claims and the miner's right to possession is, by s. 31, expressly qualified so as to be good only as against third parties and not as against the Crown. Were it not for this, a miner holding a claim might be said to have something in the nature of a profit a prendre.
However, as already mentioned, a miner holding a claim becomes entitled to extract minerals from the land and when extracted those minerals are his absolute property; for the purposes of the appellants' argument based upon s. 34 (1) of the Property Law Act, 1969 it is this characteristic which is said to give to the holder of a claim an interest in land. By s. 3 of the Property Law Act, 1969 both "land" and the phrase "mines and minerals", which is itself used in the definition of "land", are defined; the definition of "land", when expanded by the inclusion therein of the defined meaning of "mines and minerals", reads in part as follows:
"land" includes land of any tenure and mines and minerals including any strata or seam of minerals or substances in or under any land and the right to work and get the minerals and substances whether or not they are held apart from the surface of the land It is the reference in that definition to a "right to work and to get the minerals and substances" which is said to result in the holder of a claim having an interest in land for the purposes of s. 34 (1) of the Property Law Act, 1969.
The definition of "land" as including the right to work and get the minerals and substances in any strata or seam in or under any land appears to me aptly enough to describe the right conferred upon a miner by his holding of a mineral claim over Crown land. The words "whether or not they are held apart from the surface of the land", subject to which the expanded meaning of "mines and minerals", when introduced into the definition of "land", must be read, do not, I think, operate so as to confine the operation of the definition to land other than Crown land; the right to work and get minerals is, in the case of Crown land, held of the Crown in the sense that it is a right granted by the Crown and if "land" is to be extended by definition so as to include a right to work and extract minerals it will follow that if that right is held by a person who has no title to the surface of the land it answers the description of a right "held apart from the surface of the land". Nor do I see any other ground for excluding Crown lands from the definition of "land". The reference in the definition of "land" to "land of any tenure" does not appear to me to provide such a ground; no doubt Crown land over which no rights have been granted by the Crown cannot aptly be described as land of a particular tenure but once the Crown grants rights over Crown land the grantee may be said to hold land of a particular tenure granted by the Crown, as in the case of a Crown lessee, and a Crown leasehold would appear to fall directly within the definition of "land" so that the creation or disposal of interests in such a leasehold by the lessee would, subject to any provisions to the contrary in relevant Lands Act legislation, attract the provisions of s. 34 (1) of the Property Law Act, 1969. Similarly, since "land" is defined to include a right to work and get minerals, the holding of that right from the Crown is not inconsistent with the reference to "land of any tenure". Nor is it, I think, material that it is the working of the minerals and substances in any strata or seam which is referred to. In the case of Crown land occupied as a claim the strata or seams of minerals in situ remain the property of the Crown but I do not read the definitions as requiring that both the right to work and get minerals and also the strata or seams to be worked must all be held in tenure; it suffices if only the former be so held. Likewise the definitions are consistent with the inclusion in the definition of "land" of a mere right to work and get minerals, without having any title to the strata or seam in which they are contained.
Accordingly I conclude that the effect of the relevant definitions in s. 3 of the Property Law Act, 1969 is to include within the defined meaning of "land" for the purposes of the Property Law Act, 1969 the rights conferred upon a miner who takes up a mineral claim on Crown land.
The point does not appear to be the subject of any authorities; the definitions of land and of mines and minerals in s. 3 are derived from similar definitions in s. 205 of the Law of Property Act, 1925 U.K.; this in itself throws no additional light on the proper interpretation of the definitions other than perhaps to emphasize that an important function of the definition of "mines and minerals" is to expand the meaning of those two terms where they occur in the definition of "land"; in the United Kingdom Act this is certainly the case, the definition of "mines and minerals" forming portion of and being explanatory of the definition of "land".
No doubt a claim, viewed in isolation from the miner who holds it and on whom, because of his status as a miner and his holding of the claim, statutory rights are conferred, is not itself an interest in land but it is not, I think, in that narrow sense that the agreements employ the term "claim" and "mineral claim". It is not the meaning of "claim", as statutorily defined, of which the agreements speak, not the mere geographical area of a claim, but, rather, the statutory rights which the holding of a claim confers upon the holder, necessarily a miner, rights which he may exercise within the area of the claim.
Counsel for the respondents put this point slightly differently when he contended that what he described as the pooling arrangement, provided for in the first agreement and set out in par. 5 (a) of the statement of claim, dealt only with one of two elements which, taken together, constituted a right to work and get minerals. These two elements were the possession of a miner's right and the holding of a claim and it was only the latter that the agreements affected; with the former the agreements had nothing to do, indeed there was never any question of a dealing in any miner's right, each holder of a claim or any interest in a claim having, by the Mining Act, to be possessed of his own miner's right, granted to him by the Crown, before he could acquire a claim or an interest in a claim. It followed, it was said, that if the dealing in a right to work and get minerals from a strata or seam of minerals was the touchstone of the applicability of s. 34 (1) it could not apply here since no such right was dealt in but only one element of that right which, without the other element, possession of a miner's right, did not of itself confer any right to work and get minerals. This argument mistakes, I think, the effect of the possession of a miner's right; it is true that it is a necessary first step, a necessary qualification, before the right to mine may be acquired but it is no more than that. It places a person in a position lawfully to take possession of Crown land but not until possession of an area, the claim, is taken does any land become subject to the right to mine which right, until that time, is inchoate and lacking in subject matter. The situation upon a transfer of a claim illustrates this; the transferee must be the holder of a miner's right but until the claim or a share in it is transferred to him that miner's right gives him no rights whatever to minerals in the land comprised in the claim. The definition of "mines and minerals" in the Property Law Act, 1969 is, I think, speaking of a right to work and get specific minerals, those which lie in a strata or seam in particular land, and to describe the amorphous rights conferred by a miner's right as of themselves in any meaningful sense one of two elements making up that right to mine is erroneous; it is the acquisition of a claim that, for the first time, confers upon the holder of that claim a right to mine specific minerals. Accordingly, a dealing in a claim, although absent any associated dealing in a miner's right, is none the less a dealing in a right to work and get the minerals in any strata or seam of minerals in or under any land and is therefore an interest in land affected by s. 34 (1).
It is convenient at this stage to advert shortly to one aspect of the operation of s. 273 of the Mining Act. It reads as follows:
But no person shall acquire any interest under any transfer of a mining tenement held under a miner's right, unless such person is the holder of a miner's right.
It was relied upon by counsel for the appellants for quite another purpose in that portion of his argument involving s. 4 of the Statute of Frauds, it being there said that "chattel interest" meant "chattel interest in land", so that the Mining Act expressly declared every interest in every mining tenement, including a claim, to be a chattel real to which the Statute of Frauds would apply. However in that part of his argument which relied upon s. 34 (1) of the Property Law Act counsel contended that even if, contrary to his submission, "chattel interest" meant personal property, as distinct from real property and chattels real, this did not detract from the force of the argument that for the purposes of s. 34 (1) of the Property Law Act claims and interests in claims were "land". He relied upon the fact that the Property Law Act was later in point of time than the Mining Act and had, in the definition of "land", expressly legislated as to the juristic nature of the rights conferred by claims; by this argument the appellants sought to protect themselves from any prejudicial effect to their contentions based on s. 34 (1) should the Court conclude, contrary to their submissions, that s. 273 of the Mining Act did, on its proper interpretation, deem all mining tenements to be chattels, and hence personal property, as distinct from chattels real. I accept the appellants' contentions that s. 273 can have no effect on the meaning of land in s. 34 (1) of the Property Law Act; the specific reference to the right to work and get minerals contained in s. 3 of the 1969 Act and its inclusion in the defined meaning of "land" appears to me, for the purposes of the Property Law Act, to prevail over whatever deeming operation s. 273 may otherwise have.
The appellants have accordingly, in my view, made good the first step involved in their reliance of s. 34 (1) of the Property Law Act. Their second step must be to show that s. 34 (1) applies to the transactions purportedly effected by the oral agreements. That sub-section is as follows:
(a) no interest in land is capable of being created or disposed of except by writing signed by the person creating or conveying the interest, or by his agent thereunto lawfully authorised in writing, or by will, or by operation of law;
(b) a declaration of trust respecting any land or any interest therein shall be manifested and proved by writing signed by a person who is able to declare the trust or by his will;
(c) a disposition of an equitable interest or trust subsisting at the time of the disposition shall be in writing signed by the person disposing of the interest, or by his agent thereunto lawfully authorised in writing or by will.
The appellants contend that the first, and a vital, part of the agreement of 3rd December falls within the terms of s. 34 (1). It is contained in par. 5 (a) of the statement of claim and the appellants described it as effecting a pooling of undivided interests in each of the mineral claims, so that instead of one or more of the parties having exclusive rights to particular claims all the parties acquired specified fractional rights in all of the claims. This pooling arrangement could be regarded, it was said, either as the creation of certain new interests in land or as the disposal of existing interests and was, in either event, struck at by s. 34 (1) in the absence of writing, involving as it did either the creation or disposal of interests within par. (a) of the sub-section or declarations of trust within par. (b).
There are, necessarily, difficulties in determining what precise transactions are involved, as a matter of law, in an agreement made by laymen which is expressed in terms of the result to be attained without clearly identifying the transactions involved in its attainment. These difficulties are increased when the agreement is oral and its terms have to be ascertained by a process of judicial selection from amongst the conflicting testimony offered by the several parties to the conversation which constituted it. The learned trial judge has found that the agreement of 3rd December 1970 was substantially in the terms pleaded by the plaintiffs. Looking at the term pleaded in par. 5 (a), it does appear to me to involve the creation of a series of equitable interests, each applicant or group of applicants for registration of a particular mineral claim declaring that that claim is to be held by him or them on behalf of all the parties to the agreement in the proportionate shares there agreed upon. This follows, I think, from the ordinary meaning of that part of the pleading. Paragraph 5 of the statement of claim, after reciting that the parties "discussed the ownership of" the claims, goes on to allege that they then agreed that "as between themselves" the twenty-two claims "should be held by them" in certain specified shares "for" all the parties to the agreement.
If this be so the oral agreement did, by its first term, seek to declare trusts respecting each of the mineral claims, thereby creating equitable interests, and pars. (a) and (b) of s. 34 (1) will apply if, as I have held, the claims and the rights relating to them are "land" for the purposes of that section.
I am assisted in reaching this conclusion by what I have described of the history of the pegging out of the claims, which discloses that the person or persons alleged in pars. 1 to 4 of the plaintiffs' statement of claim as have been applicants for registration of particular claims, allegations which are admitted by the defence, were rarely the only persons beneficially entitled to the claims in question. One instance of this will suffice: registration of the mineral claim which was pegged partly on Crown land and partly on privately owned land was applied for in the name of Adamson yet it was agreed that the beneficial entitlement should be enjoyed as to one half by the four members of the Adamson syndicate and as to the other half by Hayes and Freebairn; the history discloses a number of other instances. It is clear then that at the very outset the parties distinguished between, on the one hand, the person or persons in whose name a claim might be registered under the quite detailed system of registration of title to mining tenements which is created by the Mining Act and regulations under it and, on the other hand, the persons beneficially entitled to that claim. A quite conscious distinction was drawn between the intended registered holder or holders of a claim and those who were to be beneficially entitled to it. This appears to me to be accounted for only by an intention to create equitable interests in the claims by informal declarations of trust. Accordingly, from the very beginning the creation of equitable interests in claims was no novelty to the parties.
When subsequently a pooling of the claims was contemplated the parties do not appear to have envisaged anything in the way of any actual alteration in the identity of those who, by reasons of applications already made, would become the registered holder or holders of claims; the sort of dealings which would have been called for so as to give effect on the register to this pooling would, at the very least, have involved delay and difficulty - see ss. 272 and 308 (6) and regs. 154 and 189 (6). When it is recalled that the parties contemplated that the pooling arrangement would be of only a very temporary nature pending the disposal of the interests of the Adamson syndicate, there seems to me to be little likelihood that anything in the nature of a change in registered ownership was intended.
Indeed it seems to me to be probable that the terms agreed upon as to pooling were incapable of being given effect to on the register. Applications for registration, when made in the name of more than one person, must specify the number of shares or units held by each - s. 272 - a requirement which would be made apparent to any applicant for registration by the terms of the prescribed form of application, form 23 of the regulations. This concept persists throughout the scheme of registration of mining tenements set up by the Act and regulations and would have prevented two or more persons being jointly registered following a transfer to them of a fractional part of an original applicant's share in a claim. Yet this is what the pooling would have necessitated if reflected on the register; it is a feature of the pooling that the individual entitlements of each of the various members of the Adamson syndicate and of Hayes or Freebairn remain unquantified.
The fact that the agreements contemplated that Western Titanium N.L. might, after the pooling, then acquire a half of the total interests in the claims from the Adamson syndicate, Hayes and Freebairn possibly then increasing their interest by acquiring the syndicate's remaining six per cent interest, is perhaps a further indication that dealings in equitable interests off the register were what the parties contemplated, although no doubt once a relatively permanent pattern of beneficial ownership emerged those so entitled might then require appropriate transfers to them of the registered shares in the claims.
It is sufficient for present purposes that I should conclude that the agreement of 3rd December operated so as to create new equitable interests in the claims and thus was within pars. (a) and (b) of s. 34 (1). For the appellants it was also urged, in the alternative, that the pooling arrangement involved the disposal of existing equitable interests in land rather than their creation. In Grey v. Inland Revenue Commissioners [1] Lord Radcliffe, when speaking of a direction given by the equitable owner of trust property to his trustee by which he prescribed new trusts, said that that might be described as a declaration of trust but might at the same time, to the extent that it determined that equitable owner's existing interest, also be a grant or assignment of his interest in favour of the new beneficiary. It may be that in the present pooling arrangement it is possible to discern both the creation of equitable interests in land and also the disposal of existing equitable interests. If so, this would be a further ground for the application of s. 34 (1) (a).
Since it is common ground that no writing such as is required by par. (a) or par. (b) of s. 34 (1) exists in relation to the agreement it follows that the pooling arrangement has never come into effect. Without it the very subject matter of the later clauses of the agreements of 3rd December and of the whole of the agreement of 12th December, namely fractional interests in the pooled claims, does not exist.
On this appeal the question of the respondent's entitlement to damages was not argued and what I have already said is sufficient to deny them the relief they obtained by way of a decree for specific performance. However lest any question of damages arises hereafter I may say that I agree with what is said by my brother Walsh J. concerning the appellants' reliance upon s. 4 of the Statute of Frauds; it does not, in my view, provide any answer to the respondents' claims.
Adamson
Hayes