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This is a Bill, not an Act. For current law, see the Acts databases.
New South Wales
Mine Subsidence Compensation Amendment
Bill 2014
Explanatory note
This explanatory note relates to this Bill as introduced into Parliament.
Overview of Bill
The object of this Bill is to make amendments to the Mine Subsidence Compensation Act 1961
(the Principal Act) as follows:
(a) to provide that the Mine Subsidence Board (the Board) is not to pay out a claim for
compensation from the Mine Subsidence Compensation Fund (the Fund) relating to
preventative or mitigative expenses incurred or proposed before the relevant subsidence
occurs,
(b) to provide that the Board may reject a claim for compensation for preventative or mitigative
expenses if the Board is of the opinion it is disproportionate to the expense of repairing or
replacing the improvements or household or other effects concerned,
(c) to make it clear that the Board must notify claimants of its decisions relating to claims for
compensation and the reasons for those decisions,
(d) to clarify the operation of provisions relating to Board approvals and certificates of
compliance,
(e) to make savings and transitional amendments.
Outline of provisions
Clause 1 sets out the name (also called the short title) of the proposed Act.
Clause 2 provides for the commencement of the proposed Act on the date of assent to the
proposed Act.
b2011-116-42.d25
Mine Subsidence Compensation Amendment Bill 2014 [NSW]
Explanatory note
Schedule 1 Amendment of Mine Subsidence Compensation
Act 1961 No 22
Amendments relating to claims for preventative or mitigative expenses incurred or
proposed before subsidence occurs
The Compensation Scheme
The Principal Act establishes a compensation scheme to allow persons to make claims for
compensation from the Fund for damage to certain assets (improvements and household and other
effects) caused by coal or shale mining subsidence. Proprietors of colliery holdings are required
to make contributions to the Fund. So long as a proprietor of a colliery holding has paid its
required contributions to the Fund and observed the requirements to the relevant mining title, it is
not liable for any damage caused by subsidence arising from its activities.
The compensation scheme established by the Principal Act also provides that claims for
compensation may be made for proper and necessary expenses incurred in preventing or
mitigating such damage where, in the opinion of the Board, an owner of an asset could reasonably
have anticipated that the damage would otherwise have arisen from a subsidence that has taken
place--see current section 12A (1) (b) of the Principal Act.
For example, an owner of a house may claim compensation for preventative or mitigating work
(such as building retaining walls or underpinnings, etc), before damage to the house occurs, if the
damage is reasonably anticipated damage from a subsidence that has taken place.
The Board also has a function under section 13A of the Principal Act that enables it to arrange for
preventative or mitigating works to be carried out as a means to reduce the total prospective
liability of the Fund. The exercise of this function is within the discretion of the Board and the
Principal Act does not provide for a statutory appeal to the Land and Environment Court regarding
such decisions.
The High Court Decision
The High Court case of Jemena Gas Networks (NSW) Limited v Mine Subsidence Board [2011]
HCA 19 expanded the operation of this scheme. In this case, Jemena Gas Networks (NSW)
imited, the owner of gas pipelines between Moomba and Sydney, was made aware that coal
mining would take place under certain of their pipelines. Expert consultants predicted that the
planned coal mining would cause subsidence that would damage a pipeline unless preventative or
mitigating works were carried out. Consequently Jemena caused these works to be carried out
(excavating the pipeline, decoupling it from the soil and carrying out associated filling). When
Jemena claimed for compensation for the works, the Board refused to pay the claim relying on the
fact that subsidence had not occurred before the expense of the works was incurred.
The High Court held, as a matter of legal interpretation, that a claim could be made under this
scheme even before the subsidence had commenced, so long as it was reasonably anticipated that
the subsidence would commence. The High Court reasoned that the Board's interpretation of the
law would mean that an owner faced with slow subsidence would be able to claim compensation
for preventative and mitigating works, but an owner faced with simultaneous subsidence and
damage would not. In the opinion of the High Court, this result could not have been the intention
of Parliament.
The High Court's expanded interpretation of section 12A of the Principal Act is now the law that
governs the payment of compensation from the scheme.
The Amendments
Schedule 1 [3] and [4] amend section 12A of the Principal Act to modify and limit the operation
of the compensation scheme as expanded by the High Court. Under the proposed new
section 12A (1A), the Board must not make a payment from the Fund for a claim for any
preventative or mitigative expense unless:
(a) the claim is made after the subsidence concerned has commenced, and
(b) the expense is incurred or proposed after the subsidence concerned has commenced, and
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Mine Subsidence Compensation Amendment Bill 2014 [NSW]
Explanatory note
(c) at the time the expense is incurred or proposed the damage concerned is more likely than
not to occur, and
(d) the Board is satisfied that the preventative or mitigating work (or proposed preventative or
mitigating work) is appropriate and necessary to prevent or mitigate the damage concerned,
and
(e) the subsidence concerned is not due to operations carried on by the owner.
Schedule 1 [3] also inserts proposed section 12A (1B) into the Principal Act to provide that the
Board may reject a claim for preventative or mitigative expenses if the Board is of the opinion that
the total preventative or mitigative expenses claimed are disproportionate to the reasonably
expected total expense of repairing or replacing the improvements or household or other effects
concerned if no preventative or mitigating work had been or were to be carried out.
Schedule 1 [5] and [6] make consequential amendments to section 12B (Appeals) of the Principal
Act.
Amendments relating to notification of Mine Subsidence Board decisions and
reasons for decisions
Schedule 1 [2] and [4] insert provisions into the Principal Act to make it clear that the Board must
notify claimants of its decisions relating to claims for compensation under sections 12 and 12A of
that Act and the reasons for those decisions.
Amendments relating to approvals and certificates of compliance
Schedule 1 [7] extends the duration of approvals to alter or erect improvements, or to subdivide
land, within a mine subsidence district from 2 years to the period specified in the approval
concerned, being a period of at least 2 years, but not more than 5 years, from the date of the
approval.
Schedule 1 [9] makes it clear that the prohibition against making compensation payments from
the Fund in relation to improvements that have been erected or altered, or subdivisions of land
made, without the approval of the Board (or not in accordance with any such approval) extends to:
(a) claims for preventative or mitigative expenses under section 12A of the Principal Act, and
(b) claims relating to household or other effects fixed or attached to the unapproved
improvement or damaged as a consequence of damage to the unapproved improvement, and
(c) claims relating to improvements on land within an unapproved subdivision that were
erected or altered after the land was subdivided, and
(d) claims relating to household or other effects on land within an unapproved subdivision for
the purpose of erecting or altering an improvement.
Schedule 1 [1] and [8] make consequential amendments.
Schedule 1 [10] deals with the circumstances in which the Board may issue a certificate of
compliance after an improvement was altered or erected, or a subdivision of land made, in such
circumstances. A certificate of compliance is for all purposes deemed to be conclusive evidence
that the requirements of the Principal Act relating to the improvement or the subdivision have been
complied with up to the date of the certificate.
The proposed new provisions provide that the Board may issue such a certificate if the Board is
satisfied that it is appropriate to do so having regard to the circumstances of the case. However,
the Board must not issue the certificate in relation to the following:
(a) an improvement that is a residential building that was altered or erected more than 15 years
before the application for the certificate was made, unless the Board is of the opinion that:
(i) the failure to obtain the approval was not the fault of the applicant, or
(ii) exceptional circumstances exist,
(b) an improvement that is not a residential building, unless the Board is of the opinion that
exceptional circumstances exist.
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Mine Subsidence Compensation Amendment Bill 2014 [NSW]
Explanatory note
Amendment relating to classified roads
Schedule 1 [11] inserts a provision into the Principal Act to make it clear that Roads and Maritime
Services (RMS) may make claims for compensation under sections 12 and 12A of the Principal
Act in relation to any classified road as if RMS were the owner of the road and payments may be
made from the Fund to RMS accordingly.
Savings and transitional amendments
Schedule 1 [12] and [13] contain savings and transitional amendments. Schedule 1 [12] enables
regulations of a savings or transitional nature to be made. Schedule 1 [13] provides that the
proposed amendments to sections 12A and 15 (5) (b) of the Principal Act by the proposed Act are
to be taken to have commenced on the date that the Bill for the proposed Act was first introduced
into Parliament (the introduction date). However, those provisions, as in force immediately
before the introduction date, continue to apply in relation to the following:
(a) a claim lodged with the Board before the introduction date,
(b) a claim lodged with the Board after the introduction date in relation to an expense incurred
before that date.
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First print
New South Wales
Mine Subsidence Compensation Amendment
Bill 2014
Contents
Page
1 Name of Act 2
2 Commencement 2
Schedule 1 Amendment of Mine Subsidence Compensation Act 1961 No 22 3
b2011-116-42.d25
New South Wales
Mine Subsidence Compensation Amendment
Bill 2014
No , 2014
A Bill for
An Act to make miscellaneous amendments to the Mine Subsidence Compensation Act 1961
relating to claims for compensation under that Act; and for other purposes.
Mine Subsidence Compensation Amendment Bill 2014 [NSW]
The Legislature of New South Wales enacts: 1
1 Name of Act 2
This Act is the Mine Subsidence Compensation Amendment Act 2014. 3
2 Commencement 4
This Act commences on the date of assent to this Act. 5
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Mine Subsidence Compensation Amendment Bill 2014 [NSW]
Schedule 1 Amendment of Mine Subsidence Compensation Act 1961 No 22
Schedule 1 Amendment of Mine Subsidence Compensation 1
Act 1961 No 22 2
[1] Section 4 Definitions 3
Insert at the end of the section: 4
(2) Notes included in this Act do not form part of this Act. 5
[2] Section 12 Claims for damage arising out of subsidence 6
Insert after section 12 (2): 7
(3) The Board must notify the claimant of its decision about a claim and the 8
reasons for its decision. 9
[3] Section 12A Claims arising out of actions to prevent or mitigate damage 10
Omit section 12A (1). Insert instead: 11
(1) The following claims may be made under this Act for payment from the Fund: 12
(a) a claim for compensation for damage incurred as a result of the exercise 13
by the Board of its powers under section 13A, 14
(b) a claim for preventative or mitigative expenses. 15
(1A) The Board must not make a payment from the Fund for a claim for any 16
preventative or mitigative expense unless: 17
(a) the claim is made after the subsidence concerned has commenced, and 18
(b) the expense is incurred or proposed after the subsidence concerned has 19
commenced, and 20
(c) at the time the expense is incurred or proposed the damage concerned is 21
more likely than not to occur, and 22
(d) the Board is satisfied that the preventative or mitigating work (or 23
proposed preventative or mitigating work) is appropriate and necessary 24
to prevent or mitigate the damage concerned, and 25
(e) the subsidence concerned is not due to operations carried on by the 26
owner. 27
(1B) The Board may reject a claim if the Board is of the opinion that the total 28
preventative or mitigative expenses claimed are disproportionate to the 29
reasonably expected total expense of repairing or replacing the improvements 30
or household or other effects concerned if no preventative or mitigating work 31
had been or were to be carried out. 32
[4] Section 12A (4)-(6) 33
Insert after section 12A (3): 34
(4) The Board may determine the amount of payment in response to a claim under 35
this section. 36
(5) The Board must notify the claimant of its decision about a claim and the 37
reasons for its decision. 38
(6) In this section, preventative or mitigative expense means an expense incurred 39
or proposed by or on behalf of the owner of improvements or household or 40
other effects in preventing or mitigating damage to those improvements or 41
household or other effects arising from subsidence. 42
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Mine Subsidence Compensation Amendment Bill 2014 [NSW]
Schedule 1 Amendment of Mine Subsidence Compensation Act 1961 No 22
[5] Section 12B Appeals 1
Omit "or could reasonably have been anticipated" from section 12B (a). 2
[6] Section 12B (c) 3
Insert at the end of section 12B (b): 4
, or 5
(c) to reject a claim because of a matter specified in section 12A (1A) 6
or (1B). 7
[7] Section 15 Mine subsidence districts 8
Omit "2 years after the date of the approval" from section 15 (3A). 9
Insert instead "the period specified in the approval (being a period that expires at least 10
2 years, but not more than 5 years, after the date of the approval)". 11
[8] Section 15 (5) 12
Insert "(a contravening improvement or contravening subdivision)" after "this section". 13
[9] Section 15 (5) (b) 14
Omit the paragraph. Insert instead: 15
(b) no claim under section 12 or 12A is to be dealt with or any payment 16
made under this Act in respect of the following: 17
(i) any contravening improvement, any household or other effects 18
fixed or attached to a contravening improvement or any 19
household or other effects damaged as a consequence of damage 20
to a contravening improvement, 21
Note. For example, no claim may be made in respect of items placed in 22
or around an unapproved house that are damaged by the collapse of that 23
house. 24
(ii) any improvement on land within a contravening subdivision that 25
was erected or altered after the land was subdivided, 26
(iii) any household or other effects on land within a contravening 27
subdivision for the purpose of erecting or altering an 28
improvement. 29
Note. The Board may issue a certificate of compliance under section 15B (3A) 30
in respect of an improvement or a subdivision of land that was erected or made 31
without the approval of the Board. The certificate of compliance is for all 32
purposes deemed to be conclusive evidence that the requirements of this Act 33
relating to the improvement or the subdivision had been complied with up to the 34
date of the certificate. 35
[10] Section 15B Certificates of compliance 36
Omit section 15B (3A). Insert instead: 37
(3A) The Board may also issue a certificate under this section in respect of an 38
improvement that was altered or erected, or a subdivision of land that was 39
made, without the approval of the Board if the Board is satisfied that it is 40
appropriate to do so having regard to the circumstances of the case. 41
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Mine Subsidence Compensation Amendment Bill 2014 [NSW]
Schedule 1 Amendment of Mine Subsidence Compensation Act 1961 No 22
(3B) The Board must not issue a certificate under subsection (3A) in relation to the 1
following: 2
(a) an improvement that is a residential building that was altered or erected 3
more than 15 years before the application for the certificate was made, 4
unless the Board is of the opinion that: 5
(i) the failure to obtain the approval was not the fault of the 6
applicant, or 7
(ii) exceptional circumstances exist, 8
(b) an improvement that is not a residential building, unless the Board is of 9
the opinion that exceptional circumstances exist. 10
[11] Section 22 11
Insert after section 21: 12
22 Claims relating to classified roads 13
(1) Without limiting section 64 of the Roads Act 1993, RMS may make a claim 14
under section 12 or 12A in relation to any classified road as if RMS were the 15
owner of the road and payments may be made from the Fund to RMS 16
accordingly. 17
(2) In this section, classified road and RMS have the same meanings that they 18
have in the Roads Act 1993. 19
[12] Schedule 1 Savings, transitional and other provisions 20
Insert before Part 1 of the Schedule: 21
Part 1A Preliminary 22
1A Regulations 23
(1) The regulations may contain provisions of a savings or transitional nature 24
consequent on the enactment of this Act or any Act that amends this Act. 25
(2) Any such provision may, if the regulations so provide, take effect from the 26
date of assent to the Act concerned or a later date. 27
(3) To the extent to which any such provision takes effect from a date that is 28
earlier than the date of its publication on the NSW legislation website, the 29
provision does not operate so as: 30
(a) to affect, in a manner prejudicial to any person (other than the State or 31
an authority of the State), the rights of that person existing before the 32
date of its publication, or 33
(b) to impose liabilities on any person (other than the State or an authority 34
of the State) in respect of anything done or omitted to be done before the 35
date of its publication. 36
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Mine Subsidence Compensation Amendment Bill 2014 [NSW]
Schedule 1 Amendment of Mine Subsidence Compensation Act 1961 No 22
[13] Schedule 1, Part 2 1
Insert at the end of the Schedule: 2
Part 2 Provisions consequent on the enactment of the 3
Mine Subsidence Compensation Amendment Act 4
2014 5
2 Existing claims made under sections 12A and 15 (5) (b) 6
(1) The amendments made to sections 12A and 15 (5) (b) of this Act by the 7
amending Act are taken to have commenced on the date that the Bill for the 8
amending Act was first introduced into Parliament (the introduction date). 9
(2) However, those provisions, as in force immediately before the introduction 10
date, continue to apply to and in respect of the following: 11
(a) a claim lodged with the Board before the introduction date, 12
(b) a claim lodged with the Board after the introduction date in relation to 13
an expense incurred before that date. 14
(3) In this clause, amending Act means the Mine Subsidence Compensation 15
Amendment Act 2014. 16
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