IMPORTANT MINING CASE.

Auckland Star, Volume XXIX, Issue 152, 30 June 1898, Page 2

IMPORTANT MINING CASE.

FORFEITURE OF WATER

RACE.

WOODSTOCK v. WAIEII GRAND

JUNCTION

JUDGMENT FOR THE WOODSTOCK

Warden Bush yesterday gave the following written judgment in a plaint lodged by the Woodstock G.M. Company v. Waihi Grand Junction Company for the forfeiture of the defendants' water right license:—

" This was a proceeding on a complaint by the Woodstock Company for the forfeiture of a water race license held by the defendant Company on various grounds, the principal of which are non-construction and non-user, lfc was admitted:—l. That all the necessary technicalities in relation to miners' rights, incorporation of Company, etc., were in order. 2. That the dates stated in paragraphs 2 and 3 of the summons were correct and transfer duly registered. 3. That neither,the defendant Company nor its predecessor in title had constructed any part of the water race. 4. That the defendant Company have ever since the transfer of the water raco license to them been actively engaged in erecting pumping and winding machinery, prospecting and opening up the mine, but have not yeb erected any battery, nor are its operations sufficiently advanced to enable it to use any water race. 5. That the annual license fee for the licence has been duly paid. 6. That the defendant Company has expended £32,000 for machinery in opening up the mine. 7. That no proceeding for forfeiture of this water right has been instituted against the defendant Company previous to the complaint now before the Court. I find that this water right was granted on the 6th August, 1891, and that the defendant Company became its owner on the 12th February, 1896, the transfer being registered on the 24th February, 1890. Mr Cooper, counsel for defendant Company, very ingeniously contended :—l, That Hub-section 14 or Section 105 of the Mining Act, 1891, only applied to the original licensee, and that the Act fixed no time for the completion of tlse water race. 2. That as Sec- | tion 168 allowed six months within which any bona fide purchaser's title could be attacked, the defendant Company although nominally the owners of this water right for two years and three months, were entitled to a deduction of the six months during which its title was open to be attacked, which would reduce its time to 1 year and 9 months. With regard to the first contention Sub-sect *14 says ' Tlie construction of a water race ; shall be commenced within 2 months from I the issue of the license authorising the same and the " holder of the license " shall continue cutting and forming the same with reasonable diligence until the work is completed.' The holder of the license may be the original grantee or a transferee of it, the work of construction must be • commenced within 2 months of the Issue jof the license by either the one or the other, and prosecuted with reasonable diligence until completed. If the original licensee commenced the work before tranfer the transferee must continue and complete it as required. Mr Cooper's .argument carried a little further would amount to j this :A. requires a water right and puts B. forward as applicant, to whom it is granted. Aftor the istmeof the license, 15. transfers to A., who could hold it for the whole term without using the water or constructing a race. The Act does not nay this, but it provides in another section for forfeiting part of the water in cases where races are actually constructed, but are not lar<;o enough to carry the whole of the water granted. How can the view suggested as to the deduction of the six months referred to in Section 168 be adopted ? A bona fide purchaser of a right, which might be impeached during the six months for some laches on the part of its previous owner, would be more entitled to consideration if he immediately on .acquiring it entered upon the work of construction, than if he perpetuated the default of his predecessor in title by doing nothing during those six months. The six months referred to in | Section lfiS mijht have made a good excuse for asking for protection for those months, but I fail to see upon what principle the six months could be deducted from the period of ownership. The case of Fratcr v. Howe, ] J. R.N.S. 30, and Davis v. Robertson, 1 J.R.N.S. 30, quoted in support of the defendant company, were cases in which water races existed and on which sums of money had been expended, but in the present case it is admitted that no work has been done either by the defendant or its predecessor in title, and that it has no battery nor are its operation* sufficiently advanced to require water power. What guarantee is there that the defendant company will ever erect a battery or require water power '! No evidence was given or suggestion made that the construction of a battery was meditated or of the time when oiie was likely to be built. This license was granted on the 6th August, IS9I, and in about sixweeks it will bo seven years since the grant ; only six mouths short of half the whole term. The Walhalla, Goldmining Company's case was referred to on the question of abandonment, but it seems to me the present case can scarcely be said to come within that, because we have here a license owner by the defendant company for two years and three months with no user of the water or construction of the water race ; it has not even been deemed worth protecting, and I md on looking at the Register for particulars of tins right that tke annual fee instead of being paid in advance on the 6th August 1897, was paid on the 25th May last, only three days short of two mouths after the entering of the plaint. These facts weaken the aninio possidendi argument and seem to indicate that the company did not attach much value to this right or care what became of it, and had it not been for tnis plaint possibly the position would have remained the same as it is for a considerable time longer. This is a right to 100 heads of water for 15 years, which in the dry season means nearly all the water in the Ohinemuri river. The Mining Act Amendment, Act 1895, section 16 lays down—Notwithstanding anythine contained in the principal Act, it is hereby enacted that any claim, special claim or license holding shall thereupon be and be deemed to be forfeited if for any period of six months at any one time it has been neither protected nor bona fide used for the purpose for which the same was granted nor have operations been carried out in the same or in connection therewith with rea sonable diligence and in accordance with the provisions of the principal Act. This is what the Legislature has enacted with respect to mining claims ; supposing then the ground hold by th« defendant Coinniinv had been applied for, and the applicant hail proved fully a breach of tho section reerred to, would the fact of the Company having spont the thousands stated in machinery, etc., have prevented its ground being granted to the applicant? I fear not. lhoii if- a n ,i n e which has spent thousands in development can for a continuous six months' breach of the law bo forfeited by operation of that law, what then is to protect a water right license the construction (if the race for which must be commenced within 2 months of tho issue ot the license and completed with reasonable diligence when it is admitted that for 2 years and 3 months nothing has been done, nor has it ever

been protected during any portion of that time. Were it not for the stringent provisions in Sub-sect. 14 of Section 105,1 have no doubt water races would have been included in section 16. I may say I have made carefal search, but have been unable to find a parallel case to this in any report. It seems to me if a forfeiture is not inflicted in this case that it will be unfair to decree forfeiture for any future breach of the Act or regulations, be it ever so flagrant. If the law permitted me to decree a forfeiture of the defendant Company's priority with a portion of its quantity of water I might have done so, but as that course is not open I feel bound to decree a forfeiture of the water race license held by the defendant Company to use 100 heads of water from the Ohinemuri river. The complainant Company to be first applicant with the usual order of procession. With costs."