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Farmer sells land to mining company to build haul road
In March 2007, a farmer sold his rural property near Gunnedah in
NSW to a mining company. The mining company used the land to build
a haul road for its mining operations. The same lawyer acted for
both the mining company and the farmer on the property sale.
A clause in the contract for sale allowed the farmer to remain
in his home on the land for no more than one year from 6 March
Farmer fails to vacate land one year after sale
When the year was up, the farmer failed to vacate the property.
The mining company did not attempt to remove him for a further
In April 2010, the mining company served a notice on the farmer
to vacate the property by 31 May 2010. The farmer refused, saying
that the mining company had agreed that he could live on the
In September 2010, the mining company again served notice on the
farmer and the farmer again refused to vacate the premises.
Mining company takes legal action to remove farmer from
After this refusal, the mining company commenced proceedings in
the Consumer, Trader and Tenancy Tribunal (now known as the NSW
Civil and Administrative Tribunal or NCAT) to remove the farmer
from the land.
The initial application failed on jurisdictional grounds and the
matter came before the Supreme Court of NSW, where the farmer
It was up to the court to decide whether the farmer had been
granted a perpetual lease by the mining company, or whether he
should be ordered to vacate the property.
case a - The case for the mining company
case b - The case for the farmer
Under the written contract for sale, we granted the farmer a
licence to occupy the property for one year only after the
That one year period has expired and so the farmer no longer
has a right to occupy the property.
The farmer claims that we had previously agreed to a perpetual
lease and so the contractual one year term does not apply. We did
not agree to a perpetual lease, but even if we did, the farmer was
correctly advised by his solicitor that the terms of the contract
superseded any previous negotiations between us.
We were more than accommodating to the farmer. We allowed him
to stay in occupation much longer than he was entitled to, although
we were not required to do so. We offered him $4,000 towards moving
and clearance sale costs, and we even offered him a licence for a
further six months, but he refused.
The court must now grant us possession of the property and
require the farmer to vacate.
Even though it has been more than one year since completion of
the property sale, I still have the right to occupy the
I have a verbal agreement with the mining company granting me a
perpetual lease at no rental cost. The mining company's
community liaison officer told me that it was common practice for
mining companies to allow the former owner to stay on the property
as long as the mining company's requirements were met (in this
case, to build the haul road). We agreed that after the sale I
would be entitled to remain in occupation of the property
indefinitely and to continue my farming activities, including
running stock. It is only on this basis that I relinquished my
title to the property.
The mining company asserts that this verbal agreement was
superseded by the licence provision in the contract of sale. But
that provision was never intended to be operative. As my solicitor
explained to me, it had just been included in the contract as a tax
planning device. By including the provision, the mining company
would not have to pay GST because the property would be seen as a
continuing rural operation.
The mining company let me continue living on the property for
more than a year following the end date of the licence in the
contract for sale, which is evidence that the provision in the
contract was not operative.
The court must dismiss the mining company's application for
possession of the property.