A QUESTION OF PRIORITY.

Tuapeka Times, Volume XXXV, Issue 4960, 17 May 1902, Page 3

A QUESTION OF PRIORITY.

At the Warden's Court, Lawrence, on Tuesday last, the application of George Soott and others for a water-race out of Stony Creek and also for the priority of water-right formerly held by the Bakery Flat Sluicing. Co. was heard before Mr ' Warden Cruiokshank.

Mr Finlayson appeared for the applicants and Mr Haggitt for the objectors, the Bakery Flat SluioingCo.

The grounds of objection were that the objectors held other rights oat of the same creek ; that the applioants had applied for priority to water formerly held under abandoned license ; that the granting of the applioation for priority would prejudicially affect the rights of the objectors; and that the applioants were not entitled either by law or in equity to such priority.

Mr Finlayson, in opening the ca<:e for the applicants, said the only point involved in the applioation wa3 whether the applioants, who had been successful in a suit against the Bakery Flat Sluicing Co. for the cancellation of a water-race heli under license No. 1004, were entitled by virtue of the decree of forfeiture to the priority of right to water as well as to the race or ditch in which the water flowed. The circumstances were these : The . Bakery Flat Sluicing Co. were the holders of the third and fourth right to water out of Stony Creek. The third right had been declared abandoned by the Court and a decree of forfeiture entered up. The applioants for the abandoned race who had complied with the provisions of th 9 Aot, claimed to be registered as the holders of the third right to the water as well as of the race: The objectors, in their written objections, that by the cancellation of the third right their fourth right moved op automatically into that position and that the applioants most come in behind them. He, counsellor the applioants, submitted that objectors' contentions were neither in accordance with the provisions of the Mining Aot nor. the law of equity, Id support of this he referred his Worship to the Victorian ease, Kretohley v. Graham (pages 132 and 134), -reported in Armstrong, which he said was the first aotion which established the law on ibis point. The decision in tbie aus, he said, daacly AomA ib«i a priority or title which was declared forfeited annured to the party who bad taken the trouble to bring the suit for forfeiture, and he submitted that no distinction could be made between a water-right and mining privilege of any other description.

His Worship said he thought there was a slight difference between an applioation for a mining olaim and a water-race.

Mr Finlayson, continuing, said such was not the case, and in- support referred to the Now Zealand owe Cbing long Fang v. Lee

Chung (decided by the late Judge Chapman) and sections 85 of " The Mining Aot, 1877," section 96 of " The Mining Aot, 1886," and seotions 59 and 146 of " The Mining Aot, 1891." These sections were all on the same lineb, though differently worded, and were no doubt meant to give effeofc to these decisions. He pointed out that the evidence of Johnson, manager of the Bakery Flat Co., in the forfeiture suit, had been to the 'effect that the company had not intentionally abandoned the right and that the reason the race was disused was that there had not been sufficient water in the Creek to supply the right. This he said must be construed by the Court to be constructive abandonment. He submitted that if the objectors' contentions were correct they were put in a better position by aotual abandonment than if they had simply caused ground forfeiture, and this, he pointed out, was entirely against the law of equity, and he considered the maxims "No one can take advantage of bis own wrong," and " No -one can make his position better by his own misdeeds," were applicable to the case. No other party bat the Bakery Flat Company could be injured by the granting of the right of priority to the water to the applioants. The Warden's Court, he said, exercised all the functions of a Supreme Court and was a Court of equity as well as a Court of law and ' therefore must be guided by the maxims of equity which applied to a Court of that nature. In conclusion, he said that both the mining law in New Zealand and Victoria indicated that the party who go»s to the trouble of bringing a forfeiture suitgets.if suooeseful, the right that has been forfeited; that no distinction could be drawn between a water-right and other mining privileges, and that the whole case law and Statute law indicated that the successful party to a suit gets the. cancelled right, and he submitted the law*mu3t beapplied iq this case. If they made a distinction between a water-right and other mining privileges they would really do away with the completeness of the forfeiture law which had been handed down from the oldV Victorian law. Was it reasonable, he aeked, to suppose if there were five or six rights out of one stream and an applicant succeeded in getting No. 1 cancelled th*t the other holders should reap the benefit, and the person who was successful in the suit take fifth place instead of first ? If that contention were correct, then he submitted the objectors in this case were really placed in a better position by their negligenoe and by the cancellation of their- third right were thereby benefiting by their own wrong whioh, as he before said, was contrary to the law of equity. His Worship said it was hardly a case of wrong, it was more like a case of mergence.

Mr Finlayson, continuing, said the only logical conclusion that could be come to in tbe matter was that the applioants, who had been successful in the forfeiture suit, were entitled not only to the race or ditch but also to the priority of right to water.

Mr Haggitt submitted that his learned friend's contention was entirely- wrong. Nowhere in the Mining Acts nor in the mining law was the meaning attached to the word "priority" as given by applicants' counsel. The proceeding? in the present application were taken under " The Mining Act, 1898," and consequently the case must be deoided according to the provisions of that Act. He then referred to the various sections of the Act in which priority of right were mentioned. Section 71, sub-section 11, gave the holder of a prospecting license the right to take up a special claim license of the ground held under prospecting license. Under seotion 77 priority was given to certain persons in the order named in the second schedule of the Act where land was resumed for -mining purposes. Seotion 128, sub-sec-tion 8, gave " priority" to a person surrendering an old license for the purpose of ezohange of title under the Act of 1898 ; and under section 162, sub-section 2, " priority " was given to a successful plaintiff in a forfeiture suit. With regard to these cases he said the priority given under section 128 was really no priority at all— it was merely a continuance of a former right under an exchange of license. In the other cases mentioned in the Mining Act and above referred to nothing further was given than a prior right to applicant to apply for a license. His learned friend has evidently been misled by the word " priority " in the marginal note to seotion 162. That section stated that the successful plaintiff in a mining suit, if the holder of the miner's right, should be deemed the first applicant for seven days. If he did not apply within seven days the ground was open for application by any other bolder of a miner's right. It was clear,' therefore, that this case did not differ in any respect, from the other oases mentioned in the Mining Act, atid that section 162, subseotion 2, simply gave a priority to apply as did the other sections mentioned. In support of this contention he farther referred to the case of an absolute surrender under the Mining Aot. Could it be contended, he asked, that where the holder of a license absolutely surrendered his title, and the ground surrendered was afterwards pegged out by another applicant that the Court had power or jurisdiction to continue the priority of right formerly held by the holder of the surrendered title in the new applicant ? Sucb a contention was absurd. This was exactly the position where a mining privilege was declared absolutely abandoned by the Court. He referred to the case of Greenbank and others v. Barron and others, 13 N.Z.L.8., page 342, in which case where the holder of a mining lease had surrendered his lease for a special claim and in the meantime another person had come in and constructed ajrace over the same ground, which was afterwards sluiced away by the holder of the special claim, it was held by the Court that the title of the special claimholder dated from the date of his license, notwithstanding the fact that he had been in possession of the ground continually since the date of his former lease, the consequence of the surrender being that the priority held under the lease was lost by the sarrender. The position was exactly the same where a title instead of being surrendered was declared actually abandoned by a decree of the Warden's Court. He referred to section 79 of the Mining Act, which provides that a mining privilege shall be decided to be taken □pon the day on which lioenae is issued by the Warden, and al»o to Regulation 37, which provides that in the case of two or more water-race licenses granted for water out of the same creek priority shall be determined from the date on which the application for the licenses are filed in Court. This, he submitted.was an absolute reply to his learned friend's argument. Regarding the case cited from Armstrong, he said his Worship would see by- the wording of the paragraphs quoted that the " priority " there spoken of was exactly the same as the " priority " mentioned in the N.Z. Mining Aot — viz., a " priority " to apply and nothing more. He referred his Worship to a further quotation from Armstrong which his learned friend had omitted to quote — viz., " A person obtaining a decree of forfeiture to the .claim of another on the ground of non-compliance with the by-laws does not, however, thereby acquire a title for himself but merely removes a prior title." Referring to the equity maxims quoted by his friend, Mr Haggitt said he was surprised he had not mentioned the equity maxim, "He who is prior in time is preferred in law." The cases in which this maxim was applied were all mentioned in Broom's Legal Maxims and bis Worship would Bee by a referenoe to them that the cases in which Hhis maxim- was applied were very limited and that the. tendency of the Courts of Equity is to restrict the maxim as much as possible. He referred to the cases in which the rule was applied. The first was in a case of primogeniture, under which the eldest son, according to English law, was heir to real estate. The seoond the system of tacking mortgages. In this oase the Court of Equity is always averse to the rule of tacking, as it must be clearly shown by the first mortgagee that he had no notice of the sepond mortgage before he can tack his third mortgage. $he only other oase in which the rale was applied was in the patent law which gives the patentee a prior right to make and vend his invention, this being clearly a reward for his ingenuity^ These, strictly speaking, were the only oases in which the law gives one person a priority oyer another. He snbitted, in conclusion, that the application for priority to water out of the abandoned race, which had been de? clared absolutely abandoned, in fact, by a Warden, was not only contrary to the mining law of New Zealand, but was also contrary to the law of equity. ► His Worship intimated that he would reserve big decision till next Bitting of the Court.

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