Thanks But No Thanks: Supreme Court Refuses to Protect Invalidly Granted Tenements

In Roy Hill Iron Ore Pty Ltd v the Minister for Mines and Petroleum [2025] WASC 333, the Supreme Court of Western Australia tested the metes and bounds of s 116(2), refusing, on discretionary grounds, to grant unopposed declarations to protect invalidly granted mining leases where there had been non-compliance with the Mining Act 1978 (WA) (the Act).

Background

The Plaintiff, Roy Hill Iron Ore Pty Ltd (Roy Hill), sought declarations on the validity of two mining leases that it held (Mining Leases). Roy Hill had failed to lodge mineralisation reports and statements of proposed mining operations with the applications for the Mining Leases. Pursuant to s 74(1)(ca)(ii) of the Act, a mining proposal or a mineralisation report must accompany an application for a mining lease. Rather than accompanying the application, those mineralisation reports and statements were delivered sometime after the lodgement of the application. In Forrest and Forrest Pty Ltd v Wilson (2017) 262 CLR 510, the High Court ruled that mining leases purportedly granted in the same circumstances were invalidly granted.

The Mining Leases were also subject to a mortgage.

Fresh applications for an exploration licence and a mining lease over the area of the Mining Leases (described by Roy Hill as ‘protective applications’) were made by Roy Hill’s holding company in late 2017. Objections to the protective applications were lodged by a third party, however, those objections did not seek to impugn either of the Mining Leases. Roy Hill also objected to those applications, in what it described as ‘friendly objections’.

Both Roy Hill and the Minister for Mines and Petroleum sought a declaration affirming the validity of the Mining Leases despite non-compliance with the Act. 

Findings

Roy Hill accepted that it had failed to comply with s 74(1)(ca) by failing to accompany its mining lease applications with a mining proposal and mineralisation report. It accepted that this non-compliance was the same and would have the same consequences as that of Forrest & Forrest. Namely, the Mining Leases were not validly granted as the relevant conditions precedent to the Minister’s power to grant the Mining Leases had not been satisfied.

The Court accepted that s 116(2) of the Act protected the mortgagee from an attack on the validity of the tenements, applying the Western Australia Court of Appeal decision in Wyloo Metals Pty Ltd v Quarry Park Pty Ltd.¹

The Court emphasised, however, that there was no evidence of any actual or threatened challenge to the mining leases or the mortgage. Consequently, the Court found the declaration ‘so far as it is directed to the protection of the mortgagee, is answering a question which might be described as ‘purely hypothetical” and ‘would produce no foreseeable consequences’.

As to protecting Roy Hill’s interests ‘to the fullest extent possible’ as it sought, the declaration would grant Roy Hill protection beyond what s 116(2), as interpreted by the High Court in Forrest & Forrest, requires. It would have the effect of protecting Roy Hill where it was ‘the author of its own misfortune’.

As a result, the Court refused to make the declaration sought, citing the absence of opposition, width of the declaration (going beyond Forrest & Forrest) and effect against the world at large.

Implications

By refusing to extend s 116(2) protection against hypothetical challenges to applicants that have failed to comply with the Act, the Court has shut off this potential pathway to protection. 

The Court’s finding solidifies the importance of ensuring compliance with the Act when making applications for tenements. While the Mining Amendment Bill 2025 currently before the Upper House seeks to relax some of the timing requirements, that relief is limited to currently pending and future applications, not already-granted tenements. In the meantime, compliance is king.

Footnotes

1. Refer to HFW’s September 2025 bulletin article on Peter John Panizza v Barto Gold Mining Pty Ltd & Ors [2025] WAWC 2 for another case applying Wyloo.