In this landmark judgement of the Wardens Court, the Warden provides an examination of and practical guidance on how the Court will determine compensation for mining activities over private land under s 123 of the Mining Act 1978 (WA). It is the first substantive judgement of a compensation determination under s 123.
The case concerned a determination of compensation for an exploration drilling program and an open pit mine proposed by Barto Gold Mining Pty Ltd (Barto) on M77/265, which sat on private land in the Marvel Loch area in Western Australia. The landowner, Mr Panizza, alleged that the proposed activities by Barto would result in losses of the capital value of land and income he claimed would be generated from the land. The determination of compensation was sought by Barto after the parties failed to reach an agreement on compensation.
The determination followed an earlier determination of Warden McPhee in Barto Gold Mining Pty Ltd v Peter John Panizza [2025] WAWC 4 in which the Warden found that Barto’s tenements in question were valid. In addition, it was published contemporaneously with the determination in Barto Gold Pty Ltd v Panizza [2025] WAMW 21, in which the Warden granted Barto an application for exemption from expenditure obligations under s 102(3) of the Act for M77/265, due to the difficult relationship between Barto and Mr Panizza and his refusal to negotiate access.
In the compensation case, Warden McPhee considered that there were 4 parts to consider for each determination of compensation:
- What is the likely mining to be undertaken by Barto?
- Is the likely mining, likely to occur?
- What is the loss likely to flow to Mr Panizza as a result of the likely mining?
- What is the form and extent of the necessary consequential orders, having regard to the matters referred to in section 123 of the Act?
In considering compensation for the proposed drilling programme, the Warden found that Barto was required to establish what activities were sought to be established, as being likely to occur, and then whether those mining activities were likely to occur. Barto had satisfied that evidentiary burden. The evidentiary burden then fell on the landowner to establish what losses would likely result. In this case, Mr Panizza had sold the majority of his farmland in the area and his remaining land was not being used in any commercial manner. The Warden rejected his claims for loss of capital value and income, in addition ruling his testimony on permanent soil damage was unqualified opinion evidence.
The Warden found that the drilling programme would not cause any loss to the landowner and awarded him a nominal sum of $100.
In regard to the proposed open pit mine, the Warden declined to determine compensation. Barto had not established that it was likely to undertake the work required for an open pit mine in the absence of further exploration works. Whether or not it went ahead with those further exploration works was dependent on the drilling programme results.
The case provides a timely consideration and determination of the proper construction and operation of s 123 of the Act. By way of practical guidance, it establishes that a miner must satisfy the Court that the specific mining activity is “likely to occur” before compensation can be determined. The onus is then on the landowner to establish evidence of loss, including expert evidence where necessary, to succeed on a claim for compensation.