Compensation Clarity: Warden’s Court Makes First Comp Call

The WA Warden’s Court has fixed compensation to the landowner for a proposed drilling program at $100 in the first compensation determination under the Mining Act 1978 (WA) (the Act), having found the landowner, who previously farmed the land, was no longer using it in a manner that derived economic benefit.

Background

In Barto Gold Mining Pty Ltd v Peter John Panizza [2025] WAWC 4, Barto Gold Mining Pty Ltd sought a determination of compensation for a proposed drilling program and open pit mine over private land in Marvel Loch, near Southern Cross, having been unable to agree compensation with the private landowner.  The landowner’s primary defence rested on a challenge to the validity of Barto’s surface rights over his land (which was unsuccessful – see our September 2025 article here).  The landowner also sought compensation for alleged losses of the capital value of land and income he claimed would be generated from the land, said to arise from both the drilling program and open pit mine.

Findings

In this first contested compensation dispute the subject of a reported decision, the Court identified, in effect, the following four questions for determination:¹

1. What mining activity does the miner propose to undertake?
2. Is that proposed mining activity likely to occur?
3. What is the loss likely to flow to the landowner as a result of the mining that is likely to occur?
4. What orders are necessary, having regard to the matters referred to in section 123 of the Act?

The Court found the onus falls on the miner to prove, on the balance of probabilities, that the proposed mining is more likely than not to occur.  If that onus is satisfied, the onus then shifts to the landowner to establish what losses are likely to flow from that mining. 

In respect of the fourth question, the Court referred to section 123(8) and its earlier decision in another matter, Ausgold Resources Limited & Anor v Opotiki Pty Ltd & Ors [2025] WAWC 3.  Section 123(8) provides that where it is ‘impracticable or inexpedient to determine the amount of compensation to be paid in full satisfaction’ of a compensation claim, the Court may determine the claim in part, or for a specified period.  Although not arising in this case on the facts, the Court stated that section 123(8) of the Act could be used to defer the determination of parts of a claim for compensation where it relied on uncertain factual circumstances which are not known at the time of trial. 

After considering the evidence, the Court found that Barto was likely to undertake the drilling program it proposed.

The Court found the landowner would suffer no loss as a result of that proposed drill program.  The Court found that the landowner, who had sold the vast majority of his farmland in the area (all but the lot in question) and his farm equipment, was not farming the land and would not do so before the proposed drilling program was completed.  The Court also rejected the landowner’s evidence that the drilling program would cause permanent damage to the soil and the ability to farm the land, finding that it was opinion evidence that he was not qualified to give (it properly being a matter for expert evidence). 

As the landowner would suffer no loss, the fourth question did not arise. 

The Court found that the results of Barto’s drilling program would impact its proposed open pit mine.  As a result, the Court was not satisfied that the open pit mine was more likely than not to occur in the form proposed by Barto at trial (it being dependent on the drilling program which had not yet occurred).  The Court therefore declined to determine compensation in respect of the proposed open pit mine. 

Following the delivery of the Court’s decision, the landowner sought to qualify the miner’s access to a date and time agreed by the parties, or on 14 days’ notice if not agreed.  The Court refused to do so, making orders determining compensation in the amount of $100 and declaring that the miner, upon payment of that compensation and subject to the grant of any approvals required by law, could undertake the proposed exploration drilling on M77/265. 

Implications

The decision provides much-needed guidance on how the Court will approach the task of determining compensation for mining over private land.

For miners, the decision indicates that a degree of certainty of the proposed mining is required to satisfy the Court that it is more likely than not to occur, before compensation will be determined.  Further, even where there is sufficient certainty that the mining will take place, the Court may still defer the determination of compensation where the losses arising from that mining are better determined in the future.  Those risks are an important reminder that negotiated outcomes provide significantly more certainty and reduce risk. 

For landowners, it is a warning that evidence of loss, including expert evidence where necessary, will be crucial to a successful outcome at trial.  A failure to reach agreement on compensation will give rise to a risk that mining may proceed prior to the payment of compensation for all losses, given the Court’s powers to defer the determination of compensation in full where it is impracticable or inexpedient to do so.

Both miners and landowners should therefore give significant thought to the benefits of agreeing compensation, given the inherent risks of proceeding to trial in this developing area of law. 

HFW were pleased to act for Barto in this case. 

Footnotes

1. Barto Gold Mining Pty Ltd v Peter John Panizza [2025] WAWC 4 at [11], [67].