Australia: Queensland payment legislation on mining leases may have feet of clay

Mining services contractors seeking payment for work performed on a site that is occupied under a mining lease (or other similar arrangement) should carefully check to see whether the work for which payment is claimed can be characterised as "construction work".

It is fair to say that the Supreme Court of Queensland's recent decision in Agripower Australia Ltd v J & D Rigging Pty Ltd [2013] QSC 164 was unexpected. It dispelled a widely-held assumption about what is "construction work" under the Queensland security of payment legislation. But does it mean that the Act does not apply to work on mining leases? What is the likely fall out? And might it have national significance?


The Building and Construction Industry Payments Act 2004 (Qld) (Payments Act) only applies to "construction contracts", which are contracts for the carrying out of "construction work" or the supply of related goods and services.

Agripower Australia operated the Skardon River Mine in Cape York, Queensland, with a right to extract clay. Agripower did not own the freehold. Rather, it held a mining lease. It entered into a contract with J & D Rigging for the dismantling and removal of certain mining plant. J & D Rigging made a payment claim under the Payments Act for about $3.1 million. An adjudicator determined it was entitled to a progress payment of about $2.5 million.

Before both the adjudicator and the Supreme Court, the mine operator argued that the contract was not a "construction contract" because the work that J & D Rigging was required to do was not "construction work". J & D Rigging said the works fell within the Payments Act's definition of "construction work" in section 10(1), which relevantly defines "construction work" to mean:

  1. the construction, alteration, repair, restoration, maintenance, extension, demolition or dismantling of buildings or structures, whether permanent or not, forming, or to form, part of land;
  2. the construction, alteration, repair, restoration, maintenance, extension, demolition or dismantling of any works forming, or to form, part of land ...

The mine operator said that the work was not "construction work" because even though the work was the "dismantling of buildings or structures", those structures were not "forming, or to form, part of land". This was because, the mine operator said, the mine operator did not have any interest in land (other than a bare right to extract the minerals from it) and was obliged to remove the plant in any event at the end of the lease. The plant therefore was not a fixture and did not form part of the land. This argument was accepted by the court.


In short, no.

It is significant that the mine operator's right was only to extract minerals from the land. Perhaps if the mine owner also owned the freehold the outcome would have been different. It is also apparent under the Queensland Mineral Resources Act that the Minister may consent to such buildings, structures and mining plant and equipment remaining on the land.

Further, not all of the limbs of the definition of "construction work" are limited by the expression "forming, or to form, part of land". For example, external and internal cleaning of buildings, and the painting or decorating of internal or external surfaces of buildings, structures, or works is also "construction work" for the purposes of the Payments Act.

But if the decision stands there will no longer be an entitlement to payment under the Payments Act for most work that was previously assumed to be construction work on mining leases.


The court's reasoning may apply equally to other types of land occupation and use rather than just mining leases under the Queensland mining legislation. One of the critical factors in the court's reasoning was that any buildings or structures erected on the land were required to be removed before the lease ended.

This obligation was given in effect in the Queensland mining legislation as a condition of the mining lease. Other types of land occupation (eg licences) may contain similar conditions, whether statutory or possibly even privately imposed under contract.

One possible example is the construction of temporary sporting or cultural facilities in parkland. The terms of use for parkland frequently require removal and repair of any facilities at the event's conclusion. It is possible that, based on Agripower, such work may not be "construction work" under the Payments Act.


It is possible that the decision will be appealed to the Court of Appeal. J & D Rigging has until 23 July 2013 to file a notice of appeal. An appeal would, in the ordinary course, be heard some months later, with judgment often being reserved.

However, if the Queensland Government considers that the decision should not be allowed to stand regardless of whether an appeal is filed or the result of any appeal, there are two avenues open to it to overrule the decision.

First, "construction work" includes "any other work of a kind prescribed under a regulation". No such regulation has, to date, been made. But the Government could make a regulation that includes certain work on land the subject of mining leases in the definition of construction work. Secondly, the Parliament could pass amending legislation (including retrospective legislation).


The security of payment legislation in New South Wales, Victoria, the Australian Capital Territory, Tasmania, South Australia, the Northern Territory, and Western Australia define "construction work", at least in part, by reference to works that form, or will form, part of land. Though the various States' and Territories' security of payment legislation is similar, it is not identical. While, in some cases, courts have held that the legal principles promoting consistent interpretation of federal or uniform national legislation apply to the security of payment legislation, it is now more widely accepted that they do not.

To the extent that work is done on a mining lease outside of Queensland, it is questionable whether the same arguments may be made. Take for example NSW's Mining Act: unlike the Queensland legislation that was central to the decision in Agripower, the NSW legislation does not mandate as a condition of a mining lease that the holder removes its buildings, structures and mining plant and equipment.

It is therefore open for courts in other States and Territories, if the same matter arises before them, to either distinguish Agripower on its facts, or be persuaded by the cogent arguments to the contrary that were unsuccessful in Agripower.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Most awarded firm and Australian deal of the year
Australasian Legal Business Awards
Employer of Choice for Women
Equal Opportunity for Women
in the Workplace (EOWA)

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Mondaq Advice Centre (MACs)
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.