Mine dumps from a property law perspective: Movable behemoths

Mining dumps are an inescapable feature of the South African landscape. While manmade through the accumulation of mining waste, their size and presence have been compared to that of natural koppies[1].[2] Surprisingly, as confirmed in the De Beers case,[3] these behemoths are not always regarded as being affixed to the land but have been found to be movables in some circumstances, the same category of property into which your pen or car falls.[4]

In De Beers, the root of the litigation stemmed from the granting of a right to prospect on the farm, Jagersfontein, to Ataqua Mining. The applicant (De Beers), who had previously conducted mining operations on the farm, [5] asserted that it was owner of the mine dumps on the land, which it argued were movables. This would mean they were not part of the land, and a third party could not be granted a right in terms of the MPRDA to prospect or mine them (in terms of the MPRDA’s provisions at the time).

The right of a mining company to mine dumps it has created, has been discussed by Heleen van Niekerk in a previous MLiA contribution. The Mineral and Petroleum Resources Development Act 28 of 2002 (MPRDA) previously did not regulate mine dumps,[6] allowing such dumps to be mined without acquiring a mining right in terms of the MPRDA. This lacuna has since been addressed, and a mining right must now be obtained before a mine dump can be mined.[7]

Accession, in terms of South African law, entails the joining of two or more pieces of property to form a new composite thing. The owner of the principal thing (that which gives the new composite whole its character, form and function) becomes the owner of the new composite thing.[8] In the context of the joining of a movable to land, the land is always the principal thing, thus making the landowner the owner of the newly attached movable.[9]

In the context of the accession of movables to land, the law has been characterised by uncertainty in recent decades.[10] For attachment to occur there must be permanency.[11] The factors to be taken into consideration include (1) the purpose and nature of the movable, (2) the degree and manner of attachment to the land in question and (3) the intention with which it was attached.[12] The third factor has traditionally been held to be a tie-breaker in the event of the first two factors providing an equivocal answer as to whether a join between the movable and land has occurred. However, courts have accorded increasing – if not paramount – importance to the subjective intention with which attachment took place (“new approach”).[13]

The De Beers case illustrates the consequences of this trend for mining companies’ rights to mine dumps. The court found that there was never any intention to affix the mine dumps to the land. The tailings, the court stated, were not merely discarded to accede to the land, but were rather to be kept for retreatment when technological innovations made such endeavours economically feasible.[14] Furthermore, despite the size of the mine dumps, the court seemed to be of the view that the join was equivocal. The dumps, it stated, were distinguishable from the land in question. They could also be removed without damaging the land.[15]

The court followed the so-called new approach. In doing so, it found that the subjective intention of the owner of the movable had to be the determining factor, with the traditional factors (nature and purpose of the movable as well as the manner and degree of attachment) merely serving as indications of attachment.[16] The dumps were thus found to be movable, with the consequence that De Beers was the owner.

This decision has been subject to criticism for a variety of reasons. The court ignored the prevailing criticism of the importance accorded to subjective intention in the context of accession.[17] Further, and perhaps of more interest, the application of the traditional factors for determining accession has been criticised in the context of mine dumps.[18]

The unique nature of mine dumps makes the application of the traditional factors more complex.[19] The weight of the mine dump may make it appear that it has acceded to the land.[20] However, the weight, as well as the growing of vegetation on the mine dump does not necessarily indicate attachment. The growing of vegetation on the dump, for example, may be mandated by legislation.[21] It would also not appear that the removal of a mine dump would cause damage to the land, but rather be a restoration of said land.[22] The materials in the dump may be removed for industrial use and extraction, while the land could be improved for residential or other uses.[23]

If such dumps are held to be movable, then the granting of a prospecting right in such dumps introduces an interesting scenario, in which three parties could possibly have an interest. A dump created through the mining process is classified as a “residue stockpile” for the duration of a mining right.[24] The holder of the right has the automatic right to mine the stockpile and extract minerals therefrom. However, on the expiry of such a right, the mine dump is rendered a “residue deposit”.[25] The mining of the dump in these circumstances would require that a new right is granted in terms of the MPRDA. The right will not automatically be granted to the creator of the dump.

If a mine dump is held to be movable, and thus the property of the mining right holder that created it, the granting of a mining right in such a dump means that the ownership rights of the landowner are implicated. Furthermore, we are now also concerned with the ownership rights in the “movable” mine dump. However, unlike in the case of the landowner, the creator of the mine dump does not enjoy similar protections during the awarding of mining rights– such as consultation or possible compensation – on its property. Would this give rise to an arbitrary deprivation of property in terms of the Constitution?[26] This question will be considered in an upcoming MLiA contribution.

Written by Richard Cramer.