Digging into mines and minerals

The Court of Appeal has considered the principles for interpreting reservations of mines and minerals in Wynne-Finch and others v Natural Resources Body for Wales [2021] EWCA Civ 1473; [2021] PLSCS 170, which concerned the ownership and exploitation of Welsh mudstone, the prevailing bedrock in large areas of mid-Wales. Background The appellants are the trustees of the Williams-Wynn 1987 Settlement and legal owners of substantial parts of a rural estate in Powys. The respondent is a public body corporate formed in 2012 to take over the devolved Welsh functions of the Environment Agency and Forestry Commission, and was treated as the registered owner and occupier of the land. Key points When construing the phrase “mines and minerals”, consider what was in the minds of the mining world, the commercial world and landowners at the time of the grant Pointers include whether the materials are exceptional in use, value and character and whether the instrument contains any express powers of working The dispute centred on land falling within the manors of Arwystli and Cyfeiliog – now owned by the Forestry Commission – and rights and reservations imposed when the land was disposed of by the Williams-Wynn family through awards under the Arwystli Enclosure Act 1816 and various private conveyances following an auction in 1919. The land in dispute was hilly and virtually all forested. The bedrock, below a thin layer of topsoil less than 20cm deep, was predominantly sedimentary mudstone which is consistent with low-grade aggregate and construction fill. It has limited uses and consequently is of low value. It is not typical of material produced by modern quarrying. The dispute arose when the appellant discovered that the respondent had extracted a considerable volume of mudstone and refused to compensate the appellant for the material. The respondent used the mudstone to build and maintain the forest road and tracks, which comprised around 15% of the land. Exceptions and reservations The private sales made following an auction in 1919 reserved unto the appellants as successors in title to the vendor “All mines beds and quarries of coal and ironstone and all other metals stone and minerals within and under the… premises… conveyed”, together with all necessary powers for searching locating and extracting the materials, provision for compensation to be paid to the purchasers for damage done to the surface or any buildings, and the right to occupy the surface in the exercise of such powers. There was a similar reservation in the 1816 Act to the lords of the manor, to which the appellants were successors in title, “to delve, search for, get up, make merchantable and take and carry away” any “Mines, Ores, Coals, Metals or Minerals whatsoever”. Did these reservations include the bedrock of mudstone? The law The phrase “mines and minerals” is not a definite term. When construing such provisions the court has to try to ascertain what was meant in the vernacular of “the mining world, the commercial world and landowners at the time of the grant”, in the words of Slade J in Earl of Lonsdale v Attorney-General [1982] 1 WLR 887. A pointer as to the parties’ intentions may be to consider whether the substances in question are exceptional in use, value and character and another may be derived from any express powers of working conferred by the relevant instrument. For dispositions under Inclosure Acts, which are generally in common form, while case law may have developed subordinate rules to assist, it is the true construction of the Act in question in each particular case which is key (Consett Industrial and Provident Society v Consett Iron Co [1922] 2 CH 135). The decision The judge concluded that mudstone was without doubt the common rock of the district and, being a cheap, low-grade material, it did not satisfy any test of exceptionality. She was in no doubt that mudstone would not have been viewed by the mining world as a material that was worthwhile quarrying and selling commercially in either 1816 or in 1919. Mudstone would have been used for construction purposes, but that is not what the mineral world, commercial world or landowners would consider the exception and reservation to be aimed at. The materials in mind at the time would have been lead, slate and other metalliferous materials that might be found in the area, such as zinc. Sandstone, where found in thick enough bands, might also qualify. The powers of working in the reservation also contemplated destroying and removing the mudstone to get at the minerals to be mined or quarried. The exceptions and reservations in the 1816 Act were treated in a very similar way. Mudstone would not have been regarded as merchantable, nor worth carrying away. An express right to use roads and infrastructure in the extraction of material meant that it was clearly in the contemplation of the parties that rock in the vicinity could be used for these purposes. The express power to delve, search and get up must be taken to extend to the destruction and removal of mudstone that would surround the seams of minerals that were being sought. The Court of Appeal upheld the first instance judge’s “careful, comprehensive and scholarly judgment”. The trustees’ title did not extend to ownership of the mudstone and if that was wrong the respondent had established title by adverse possession to the mudstone to whatever depth was required for their activities as surface owner of the area. Louise Clark is a property law consultant and mediator