The Department of Energy, Mines, Industry Regulation and Safety’s (DEMIRS) procedure for recovering rent and penalty debts payable on mining titles under the Mining Act 1978 (Mining Act) is outlined below.
Introduction
The Department of Energy, Mines, Industry Regulation and Safety through the Resource and Environmental Compliance Division (REC) collect annual rents for mining tenements on behalf of the State Government. This is under the Financial Management Act 2006 obligation to recover outstanding amounts.
Legislation
Amount of payment
The holder of a mining tenement must pay rent at the rates and times as prescribed in section 108 of the Mining Act. These rates can vary and are reviewed yearly, so it is important for tenement holders to be aware of these changes.
Timing and frequency of rent payments
Rent is payable annually in advance. The first payment is the rent for the first year of the term of the mining tenement and is paid at the time of lodging the application. Subsequent payments of rent are due on the anniversary date of the term of the tenement and must be paid no later than one month after that date. This obligation is outlined in regulation 109 of the Mining Regulations 1981 (Mining Regulations).
Effect of surrender, forfeiture or expiry on rent payments
If the tenement is surrendered or forfeited prior to the anniversary date or expires, then no rent is due for the following year.
Where the tenement dies on or after the anniversary date, rent payment is required, debt recovery will proceed on the dead tenement. This obligation is outlined in section 114B of the Mining Act.
For example, a lease commenced on 1 July 2015 for which a rent of $1,570 is payable by 31 July 2016. If the lease is later forfeited on 31 August 2016, the holder of the lease remains liable to pay $1,570. No provision is made by the Act to accept pro-rata amounts.
If a tenement is re-instated under section 97A of the Mining Act, the annual rent must be paid.
Non-compliance with rent payments
Non-payment or late payment of annual rent leaves the mining tenement liable to forfeiture, under sections 96, 96A and 97 of the Mining Act.
The notice of intention to forfeit process for the late payment or non-payment of rent, and other non-compliances and breaches of the Mining Act, are separate processes to the rent debt recovery process and runs parallel to this if rent remains unpaid.
Procedure for the payment and enforcement of rents
Rent reminder notices for most tenements
In most cases, rent reminder notices are issued annually in the form of a Rental Reminder. These notices are generated and sent to tenement holders about six weeks prior to the anniversary date.
For those tenements with an anniversary date of 1 July up to early August, a rental reminder cannot be issued until after gazetted annual rental increases have been entered into the electronic register. Once the gazettal occurs, the amount can be obtained from the register. For these tenements, the onus is on the tenement holder to ensure rent is paid within one month of the anniversary date.
Where a tenement rent is paid in full before the generation of a notice, then no annual rent reminder is sent.
Rent payment due
The ongoing annual rent becomes legally payable on the anniversary date and is due within one month after this date.
Overdue Rental Reminder
If the annual rent payment is not received within one month of the anniversary date, an overdue rental reminder is issued to the holder of the mining tenement. The overdue rental reminder is issued whether the tenement has been forfeited, surrendered or expired.
At this stage, the department will instigate a Notice of Intention to Forfeit letter under Regulation 49 or 50 of the Mining Regulations. The overdue rental reminder and the Notice of Intention to Forfeit are issued separately and may be sent on different dates.
Final overdue rent notice
If rent remains unpaid one month after the issue of the overdue rental reminder, a final overdue rent notice is issued giving one further month to pay.
Debt recovery action instigated
If rents remain unpaid by one month after the final overdue rent notice, debt recovery action begins.
By this stage the tenement may have been forfeited for the non-payment of rent. Forfeiture, surrender or expiry will not prevent the recovery of rent as detailed above under section 114B of the Mining Act.
DEMIRS strongly urges tenement holders to consider surrendering their tenements prior to the anniversary date to avoid paying the rent. If there is no intent to surrender the tenement, then tenement holders should pay the rent within one month of the anniversary date to avoid incurring forfeiture or a penalty for late payment of rent.
The penalty debt recovery process is very similar to the rent debt recovery process. Like unpaid rent, the death of a mining tenement does not affect the liability of the holder to pay the unpaid penalty debt under section 114B of the Mining Act.
Procedure for non-compliance with tenement conditions and debt recovery of penalties
Notice of Intent to Forfeit
A Notice of Intention to Forfeit letter is issued pursuant to Regulation 49 or 50 of the Mining Regulations. These letters are issued on a monthly basis; dependent upon the anniversary date of the tenement, and the availability of Warden’s Court dates. The correspondence can be sent out up to two months after the one-month period given to pay the mining tenement’s rent. The overdue rental reminder and the notice of intention to forfeit are issued separately and may be sent on different dates.
Penalty in lieu of forfeiture notice
When a penalty in lieu of forfeiture is imposed, a “notice of penalty” will be issued. The time in which to pay the penalty is endorsed on the notice of penalty and in eMiTs.
If rent is paid after the issue of a Notice of Intention to Forfeit Notice under Regulation 49 or 50, forfeiture or a penalty may be imposed for the late payment under sections 96(3), 96A(5) or 97(5) of the Mining Act.
Forfeiture for non-payment of penalty and Reminder Notice
If the penalty remains unpaid, the tenement will be forfeited as per section 96, 96A and 97 of the Mining Act, and a penalty reminder notice will be issued.
Final penalty reminder
If unpaid, a further final penalty reminder is issued with one month to pay. If unpaid after that, debt recovery action is instigated.
Debt Recovery Procedure for outstanding rents and penalties on Mining Titles
