THE MINING LAWS.

Otago Witness, Issue 2375, 7 September 1899, Page 21

THE MINING LAWS.

SUGGESTED MODIFICATIONS AND AMENDMENTS.

The following report has been prepared by a sub-committee of the mining. section of the Dunedin Chamber of Cqmmerce, and will come up for consideration next week: — Acting under your appointment, we have to report having given consideration to a number of the clauses under " The Mining Act, 1898," which seem to require modification and amendment, and we beg to report aa under. But, previous to going into details of these clauses, we desire to express our conviction that the mining industry, as we have seen it developing in Otago during the last two or ithree years, is one, the ultimate extent of which no one can at present estimate, and we recognise also that still further developments of the industry have already begun, and will proceed with very great rapidity. There seems to be, (therefore, a strong justification for the legislation under which this industry must necessarily be controlled being adjusted to the wants and requirements of the district, and being pushed on with a rapidity which may be unusual, but which, under the circumstances, is absolutely necessary. Those who have travelled through the various districts, and are acquainted with the interior of Otago, must be impressed with a Bense of the enormous area of auriferous gravels which ■lie here spread out ready to be worked. It would be an under-estimate to speak of these areas as extending to thousands of acres: probably they embrace more nearly tens of thousands of acres. The development of the dredging industry has provided a means by whicu low-class graveb, yielding one grain to the cubic yard, can be worked to cover expenses; whilst the gravels in most districts iiave prospects of two to five grains and upwards, and consequently can be worked to a profit. That being so, the method of working these gravels by dredging has practicully brought these areas into the mining market, and notwithstanding the number of dredges privately owned, and also the large number of companies floated for the purpose of working these areas (together absorbing a capital of nearly a million, and still increasing), the amount of land hitherto taken up by them is trivial in comparison with the known auriferpus lands to be dealt with. Under these circumstances we need not urge that legislaj tion should be adjusted as rapidly as possible I to the requirements of the colony, in order that | the industry may be still further fostered. j We may add that since the development of t 'the dredging industry a new impetus has been ! given to every class of business, and every class of local manufacture, and that therefore the "fruits are to be found not only in an enhanced production of gold, but also through ■ its distribution affecting every class in the community. | We would like also to point out that dredg- ■ ing is not a system of gold mining which will be confined to Otago, but that there are other i largo areas of similar gravels lying on the West Coast of New Zealand, and perhaps in i the North Island and elsewhere, to which this same method of working can be applied, and that therefore a fostering legislation will not j -ultimately be found to be for the benefit of I Otago alone, but for the benefit of the whole j colony. j Another word aa regards gold mining. We I may here say that in former days mining was carried on by individual miners taking up small holdings under miners' rights, working them either individually or along with a few mates, and securing to themselves the best and j most probable places for this purpose. Lands, ■however, which can be worked in th*at form no j longer exist, and, the richer patches being worked out, the individual miner is practically obsolete. The method which succeeded the individual miner was that of sluicing. This involved the expenditure of money in forming races, in many caaes of very great length, in supplying pipes, and furnishing hydraulic plant. Here, then, was marked the change between the individual miner exercising only his own resources, skill, and indomitable energies, and the system by which combination and expenditure of capital was necessary. Dredging marks a still further development of mining by combination and expenditure of capital, and the application of more efficient ■methods, and we point to this as showing that enactments and regulations, which are based too much upon the system of mining as carried on by the individual miner, are not necessarily adapted, nor are they supposed to be adapted, to the systems under which combination and capital are required. In reviewing, then, the enactments which you have requested us to consider, we realise that the legislation is still based on the requirements of an earlier period, and has not yet been brought up to the position requisite for the developing of this large and important industry on the basis to which we have referred. THE MACHINERY OP THE COURTS. The machinery of the courts seem to us ill adapted for the purpose of affording A he facilities needed for aoquiring titles, and for secur■ing tenure. In the case of a company holding a number of separate rights — which may com1 priße several tributary water rights, one or more j long races, claims, tail races, dams, etc. — the title is reoresented by a large number of docu-

' .ments; each race has practically to be renewed year by year on its own specific date; the rents of one or more,claims have also to be attended to, and pjiid on their dates of maturity; and when some titles come to be dealt with, it becomes evident that in almost every month of the year (where documents are numerous) some application has to be made for renewal or registration of one' or other of the rights held. It would afford a very great advantage if there was machinery provided so that all these dates might be concentrated into one, and thereby facilitate the conduct of the business of a company, and also obviate the serious results which might follow from any one of these details being inadvertently overlooked. We had produced to us one company's mining title which includes 17 primary documents for claims, water races, river dams, etc. To this title there are attached an acciirnulation of no less than one hundred and ninety-six (196) subsidiary documents, consisting of annual receipts for registration, miner's rights, etc., etc. ; and again, another company's title, consisting of nine primary documents and no less than one hundred and twenty-six (126) subsidiary papers. All that should be necessary to hold is the original title and the last renewal receipt, instead of being dependent on a continuity of renewals. We think also that, as in the case of payzn«nt of the rental of the claim itself, some little period of grace might fairly be allowed for the annual renewal of the registration of water rights and other similar rights. Water is essential to the working of a claim, but it would appear that unless each water right is registered annually on its proper date there is % possibility, nay, a strong probability, that some right or other will ia a series of years be lost, to the manifest detriment of the claim-holder. We do not see any reason why a month's grace might not be given, and a further period of three months under a moderate fine might not be allowed, to enable the owner to maintain his possession without any formal application being required. In tne stamping of deeds a regulation of this sort exists. Stamping may be held over for a month without cost, and after that may be held over for two months on a payment of 20 per cent, additional duty, and thereafter, on a penalty of £5, the document may still be stamped. A similar provision might well be introduced in respect of these annual renewals and registration of such rights, with the difference that no question of revenue is involved, but only the keeping alive of rights which involve important priorities, any of which may be forfeited through inadvertence. OCCUPATION. Clause 85 provides that a holder (say, of a special claim), by himself or some person on his behalf, shall remain in actual and effective occupation of a claim between the time of the taking up thereof (that is, between the day named in the license) and th« commencement of operations thereon. What is meant by actual and effective occupation? In the case of a dredging claim, which is brought into contrast in the same section, it is> equivalent to commencing and prosecuting the construction or acquisition of a dredge for working the claim (although not necessarily on the claim), but in any other case it can only mean "actual and effective occupation." Cutting a race to a slixicing claim, for instance, may be going on vigorously 10 or 20 miles away, but is certainly not active occupation, and probably no two miners would agree as to what would be requisite to comply with this requirement. RESUMPTION. In the clauses of the act 51 to 58, which provide for the resumption of freeholds, there does not seem to be any provision for notice of an application to that effect being given to all those interested in the freehold. The nominal freeholders would naturally, in ordinary course, be notified, but the freeholder may have but a small monetary interest compared with the mortgagee, and it seems to be an omission in this section that all proceedings may be carried out independently of any such notice to the party who may be the most largely interested. Section 71 deals with the issue of prospecting warrants and licenses. Sub-section 4. reads: — " The application shall in the prescribed manner be notified to the owners or occupiers of the land to which it relates, and to all other persons whose interests may be obviously affected." Probably these last words would include the mortgagee in the case of applications for prospecting licenses, although that is not by any means certain. Surely when the resumption of freeholds is being dealt with similar, or more extended, scope of notice should be provided for. COMPENSATION. Some parts of the act manifestly require immediate amendment. Clause 99, providing means of determining compensation in respect of rights being taken through private land, provides that this may be done by the warden with two assessors, one to be appointed by each of the parties, but there is no provision for a majority of such a board giving a deliverance binding on both parties. There must be unanimity. This has ajready given rise to a, deadlock in a recent case, but as we are aware that this matter has already been brought before the Government we need not refer further to it. Again, in clause 237, compensation payable in respect of any claim shall be paid out of moneys chargeable upon and deducted from the goldfields revenue derived from the mining district wherein the claim arose, until out of such revenue all moneys paid in respect to such compensation and coats have been fully recouped to ihe Treasury. This, then, affects county councils or other local bodies. But in the clause dealing with resumption already referred to there is no provision for county councils being consulted as to whether they recommend resumption, or as to whether they, consent to their finances being disturbed by such a clause as this. Many of these councils have more work in hand than their revenues will compass, and would feel severely pinched by such an operation practically stopping their revenues; for it is to be observed that not the revenues alone from the land resumed are to be held back, but that the revenues derived from the mining district wherein the claim arose are held to recoup the compensation thus paid. Clause 53. sub-section 8, dealing with the amount which an applicant for resumption must pay to the owner or occupier, puts the questioa in this form: — " A sura bearing the same proportion to the net balance of the total amount expended since the first day of December, 1836, in prospecting and mining as aforesaid (after making due allowance for all receipts and recoveries), as the acreage of the whole land to be resumed bears to the acreage of the whole block." It may be obtuseness on our part, but we confess to a difficulty in understanding how this works out. It seems to us that the method thus prescribed involves the following anomalies: — First, if the ground has been worked at a loss, the greater the loss the higher the amount to be paid; second, if there has been bo loss, no amount is payable — that is to say, if gold has been won sufficient to cover the expenditure the applicant gets the advantage of the owner's prospecting operations; third, the refund is dependent on the area, greater or less, of the block of which the land prospected forms a part, so that in a small gold-bearing area prospected forming part of a large block the refund would be reduced to a minimum, and if attached to a small block it would be proportionately enhanced. "Why should not the applicant refund all the cost of prospecting without reference to gold, and without reference to the total area held, and also recoup the owner for the risk he has taken? CONSENT. Section 53 provides that no. land thall be

resumed in certain cases without t c consent of the owner or occupier. One of these casea (sub-section 5) is one where the owner or occupier to whom authority has been granted mines for gold on the land proposed to be dealt with, sucn operations being carried out in areas marked out in the same manner as is prescribed by the act in the case of claims, no one of which exceeds the maximum area of a special claim, and in all of which the operations are conducted in accordance with the provisions of the act, as if such land had been Crown land. This opens up another serious question, for it would appear that a freeholder or occupier may make — nay, is practically enjoined to make, — for his own protection, arrangements for mining upon his land, and may, without notice to or consent of a mortgp^ee, so d'-s-.rr; the lands by mining that the seciirity nnt»n i-t»i -t» which he has borrowed may be practicallr' valueless. Moreover, an occupier or tenant may make such arrangements without notice to either freeholder or mortgagee. The freeholder should not be°allowed to raL \ on his own land unless his title ia unencumbered ; or, if encumbered, unless he shall have applied to the- warden to fix terms for the protection of all interests concerned. As a general remark, we may add that th» agriculturists should not be required to sacrifice to mining lands brought under cultivation by years of labour. Auriferous areas are not so scarce as that implies. We are of opinion, that this provision unnecessarily sacrifices the farmer to the miner. MINING PARTNERSHIPS. Part 8 of the- act is devoted to mining partnerships — evidently aiming at such combinations as would arise where a few mate together for mining purposes. (i In these cases, section 248 provides thas ' the decision of_ tho members owning a majority of the shares or interests in a mining partnership shall bind it in the conduct of its business " ; but "a. majority of shares or interests" is a term which, in the absence of definition, cannot be properly determined. If a majority of the members is meant, these may collectively hold the smaller interest. If amajority of the shares or interests means the greatez value in the claim, these may be held by a few. This ought to be remedied by definition. There are grounds for dissolution of a mining partnership provided in section 249. Thesa grounds, however, are confined to the neglect or refusal to pay or satisfy partnership liabilities, or to perform any labour which it is the duty of a member to perform or discharge, or to represent (we presume by representative labour) his share or interest in the partnership. We assume that the Warden's Court ad. ministers the Mining Act only, and we find that this court is empowered to administer certain remedies in the event of dissolution; but these remedies do not touch cases which might aiise under section 248, already quoted, where a majority refuses or neglects to comply with the decision of a majority in the conduct of the business. In such a case it would appear that no remedy ia provided by dissolution, even •n the resolution of a majority. | FACILITATING OPERATIONS. Under clause 164, " for the purpose of facilitating mining operations, end subject to regulations under the act, the warden may grant right to enter upon, occupy, and use any specific portion of the land comprised in any mining privilege, subject to .the regulations and for ' certain specified purposes." Sub-section 3, however, provides that in every case sucH right will be deemed to be granted subject t<s the condition that the grantee wilL not un-; duly interfere with the reasonable and lawful use of such mining privileges by the holder thereof, nor with his lawful mining operations thereon. It is also provided that the applicant shall pay compensation for all damage to buildings, machinery, and mining works. In i recent case, where buildings, machinery, or min.ing works did not exist, and compensation did not arise, the Supreme Court held that tho privilege sought would unduly interfere with, reasonable and lawful use by the lawful holder and with his lawful mining operations, and ii may be inferred that the privilege previously, applied for and granted by the warden would unduly interfere, and was consequently ultra vires, and it may also be inferred that every; mining privilege intended under this clause to be granted over a neighbouring claim would unduly interfere with the holder's reasonable and lawful use, and that the whole clause 164 is, therefore, inoperative. > We understand that representation has aZ-t ready been made to the Government in connection with this clause, and for the informal tion of the chamber we have procured a copy

of suggested amendments, which have been made to giy^ effect to the evident intention of the clause and render it operative. We have appended to this report a copy of these suggestions. ' LABOUR CONDITIONS. Under regulation 81 the holder of a claim is required to employ during the first year not less than -one workman to every six acres, during the second year one workman to every four acres l and during the third year one ■workman to every three acres. We submit that the number of men to be employed under this regulation is largely in excess of. the number that can -be employed profitably by the holder, and that a compulsory regulation of this character, stringently enforced, must deter, the taking up of areas which would otherwise be worked; moreover, we believe that this "regulation practically invites others to attack the title of holders who may be working claims as vigorously and as efficiently as at is possible to do without involving themselves in loss. Already there are not a few evidences of this and other stringencies in the act inviting such attacks, to the manifest detriment of the industry. It may be reasonably assumed that few people will take up claims and pay rentals for them without the intention of working them as soon as arrangements can be made, and that tenure should y foe sufficiently stable to justify large expenditure in development and to ensure a long period of profitable -work where such expenditure is necessary. . The effect of the clause practically is unnecessarily and arbitrarily to interfere with bona fida holders in the conduct of their operations. -Assuming-, however, that some such regulations a.re,required, we submit that the sur■face area of a claim gives no indication whatever of the number of men required to work it efficiently. The requirements of ' one claim differ from , another, and a holder who may •Tje assumed, to work his claim as efficiently as lie -caa must be the best judge of the number «f men to be employed, and of what is judicious to make the claim profitable. He certainly has to take the risk of success or otherwise, and has to stand or fall by the results of his own methods as certainly as a farmer, trader, or manufacturer. The labour requirements of^sluicing claims depend upon the quantity of water that maybe brought on to them for sluicing purposes. "Water cannot in every case be acquired or obtained at the same cost. A race is frequently cut many miles in length, and if the supply is limited the same number of men cannot be employed as where water is plentiful and easily obtained. Moreover, the depth of the ground to be worked has as strong a bearing upon the number to be employed as the surface area: one acre of a depth of 40ft (or, as in some cases, 100 ft and upwards) is widely different from another acre of a depth of Bft or 10ft. The area 'Should not form the basis for the computation pi labour; but the men to be employed are the same in both cases. In very few, if any, of the claims in the Otago district is it possible profitably to employ the number of men prescribed. Holders a-re therefore liable to comgpulsory infringement of, the regulation, and -to cancellation of the right at the instance of the inevitable jumper. When a holder alleges that he is entitled to employ less than the prescribed number of workmen the regulations of January, 1899, permit application to the warden to 'be made, accompanied with sworn evidence of the number employed, capital expended, etc., and the -regulations of June, 1899, provide forms for doing, so; but under the- act the warden's discretion in granting such applications extends only to a period of six months. For any longer period the consent of the Minister is zequisite. , Such relief, then, is not at any time permanent, although the circumstances may be unalterable. There is a distinction d/awn between a dredging claim and any other, which has given rise 40 % a great conflict of opinion, which we do not -think will be settled until some unfortunate ■miners have to pay the costs of a judicial decision. It occurs first in clause 86 (2) of the act, and is repeated verbatim in clause 81 of the Taruary regulations. We are compelled to assume that it is so repeated because it could mot be translated into other language, and as jwe are ourselves uuable to interpret its meandng or foretell its effect, we fulfil our duty by .quoting it for the information of the chamber. It reads thus : — " In the case of a dredging claim, the number <of workmen required to be employed on any day shall not exceed the proportion of seven work/men to each dredge." CONCLUSION. In concluding our report, we are compelled .tOssay that we think the act and the regulations thereunder err in casting on the mining indusitry too onercus a burden of small details, without compensating advantage to the .State. Under art infinity of circumstances it is made necessary to apply to the Wardens' Courts for •decisions — grants, protection, relief, etc., — [without which the tenure of mining claims could not now be maintained; and as the warden's discretion and powers are limited, these applications have 'in many cases to be transmitted "for the Minister's sanction, involving, as they must, much -labour on the department, and harassing delays and uncertainties to the miners. Not because of these, but in spite of (them, has. the mining industry developed in ,the district of Otago in a marvellous way since jthe modern dredge wa_s introduced, and, as already pointed out, this' method must necessarily spread to many/other "parts 'of New Zealand, as' it has already" done from our own •centre to Australia, and even to California and {Russia. But each successive venture involves a, capital expenditure of £5000 to £10,000 before ■an ounce of gold is won, and still larger dredges iiave to be constructed in the near future to grapple with the deep ground and high terraces which contain the wealth lying dormant under pur feet for 30 years, and ready to yield theii 1 (treasures to the combined enterprise and skill of the investor and the engineer. The one l« r ord " tenure " is all that is needed to command these agencies, and we submit to this chamber that its commercial functions will be furthered in a. way that no other means can command if, by a respectful but urgent appeal /to the^Legislature, it can successfully secure a co'lo of simple, stable laws to give the bona fide mining investor a tenure under which he iwill feel his interests secure, and his industry encouraged. Under such circumstances this industry, Jying ready to our hand, will stimulate the activities of New Zealand to an extent which ihas never -yet beeu achieved throughout its history, and the Government that effects this will earn the respect and thanks of every pettier within our shores. USTe remain," gentlemen, yours sincerely, W. Laurence Simpson. Geo. H. Oatway. « William Brown.