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England and Wales High Court (Chancery Division) Decisions
You are here: BAILII >> Databases >> England and Wales High Court (Chancery Division) Decisions >> McLean Estates Ltd v Earl of Aylesford & Ors  EWHC 697 (Ch) (12 March 2009)
Cite as:  EWHC 697 (Ch)
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BIRMINGHAM DISTRICT REGISTRY
33 Bull Street
B e f o r e :
(sitting as a Judge of the High Court)
|McLEAN ESTATES LIMITED||Claimant|
|THE EARL OF AYLESFORD|
1st Floor, Paddington House, New Road, Kidderminster, DY10 1AL. (DX 16318 Kidderminster 1)
Tel: 01562 60921/510118 Fax: 01562 743235 Email: email@example.com
MR KEITH ROWLEY QC and MR MARK WEST instructed by Needham & James LLP appeared on behalf of the Defendants.
Crown Copyright ©
"(1) Though the wide sense given to the phrase 'mines and minerals' by Lord Romilly M.R. in Midland Railway Co. v. Checkley, L.R. 4 Eq. 19 and by Mellish L.J. in Hext v. Gill, L.R. 7 Ch.App. 699 is a sense which the phrase is capable of bearing and can still be attributed to it in a proper context see, for example, O'Callaghan v. Elliott  1 QB 601, it cannot now properly be regarded as a primary or literal sense which is always to be applied in the absence of a sufficiently clear contrary context: see, for example, the Budhill case  AC 116 and Waring v. Foden  1 Ch 276 .
(2) The phrase 'mines and minerals' is not a definite term, but is one that is capable of bearing a wide variety of meanings: see, for example, the Budhill case  AC 116, 130 per Lord Gorell and the Glenboig case  AC 290, 299 per Lord Loreburn L.C. One possible meaning that had been attributed to the word 'minerals' in Darvill v. Roper, 3 Drew 294 and other pre-1880 authorities was 'all such substances as are dug out of the earth by means of a mine.' This remains a possible meaning in a proper context.
(3) Unless the meaning is clear from the four corners of the relevant instrument itself, the first duty of the court in construing a grant of mines and minerals is to try to ascertain what the phrase meant in the vernacular of 'the mining world, the commercial world and landowners at the time of the grant,' in accordance with the test suggested by James L.J. in Hext v. Gill, L.R. 7 Ch.App. 699, 719 and approved by the House of Lords in the Budhill case  AC 116. The common link between the three categories of persons referred to by James L.J. is, I think, that they are all persons who may ordinarily be expected to have both some knowledge of mines and minerals and also some experience of dealing with them in the course of commerce in this country.
(4) The meaning of the phrase in this vernacular sense may be derived either from direct evidence as to the vernacular meaning at the relevant time or by inference drawn by the court, as in Barnard-Argue-Roths-Stearns Oil and Gas Co. Ltd. v. Farquharson  AC 864. If there is clear evidence as to the vernacular meaning at the date of the trial, then, in the absence of evidence to the contrary, the court may be justified in assuming that there was a similar vernacular usage at the date of the grant: see the Glenboig case  AC 290, 299 per Lord Loreburn L.C.
(5) Where it is clearly established that, at the date of the grant, a particular vernacular meaning was attributed to the phrase 'mines and minerals' by 'the mining world, the commercial world and landowners,' the court will be predisposed to adopt that meaning. The vernacular test, however, is not a rigid test to be applied without regard to all the other terms of the instrument in question and the circumstances in which it is used: see Borys v. Canadian Pacific Railway Co.  AC 217, 223 per Lord Porter. The court must never overlook the commercial background and apparent commercial purpose of the transaction.
(6) One pointer to the parties' intentions may be to consider whether or not the substances in question are exceptional in use, in value and in character: see for example Waring v. Foden  1 Ch 276, 294 per Lawrence L.J. Another pointer is the evidence as to the general state of knowledge of the relevant substance at the date of the grant and the way in which it was then regarded and treated as a commercial matter; see, for example, Barnard v. Farquharson  AC 864, 869 per Lord Atkinson. A third, significant pointer may be derived from any express powers of working that are conferred by the instrument in question: see for example the same case at p. 869 per Lord Atkinson.
(7) In considering whether a grant or reservation of mines and minerals includes a specified substance, it is irrelevant that the parties did not actually have that substance in mind. The test of their intention is an objective one: see for example the Reardon-Smith case  1 WLR 989, 996 per Lord Wilberforce.
(8) With only a few exceptions, the cases cited deal with solid substances and not with liquid or fugacious substances, such as oil or natural gas. In considering the latter substances, cases which dealt with solid substances should be approached with some caution, because different considerations may apply, in particular relating to methods of working and the effects of working on adjacent land."
"The surrounding circumstances strongly support the judge's conclusion that the underground working restriction was a strong pointer against brickshale being a mineral for the purpose of the 1921 Conveyance. First, the existence of the Maltby Quarry, from which brickshale was being excavated by surface methods immediately adjacent to the Disposition Site, would have been well known to the parties to the 1921 Conveyance. Second, there were two coal mines in the area, and (as I have said) by 1921 it would have been common knowledge that there was at least a possibility, if not a probability, that the Barnsley seam ran, at depth, under the Disposition Site. Consequently it is a reasonable inference that the reservation and the underground working restriction together were intended to apply primarily (though not exclusively) to coal. Third, the then state of the law should be taken to have been known to the draftsman. Conveyancers of property in the area drafting minerals reservations would have been aware that the House of Lords had decided four cases between 1888 and 1911 in which it was held that ordinary clay was not a mineral but that clays with special properties were minerals. It is a reasonable inference that a draftsman intending to reserve common clay would have inserted an express reservation. Fourth, I consider that in these circumstances the notion that a stand-off was intended was as fanciful as the reliance on the 1923 Act in Waring v Foden."