It is not unusual for the Land Access Ombudsman (LAO) to receive enquiries from landholders who have purchased a property and discovered that a CCA already exists for the property.
Common questions asked of the LAO are:
- Are we bound by the CCA, given that we weren’t party to the agreement when it was signed? or
- We will be using the land for a different purpose from the previous owner and want to know if we can change the current CCA?
A CCA is recorded against the title of a property and is binding on the transfer of the land and any transfer of an interest in a resource authority.
When ownership of the property or resource authority changes, the new owners are bound by the clauses contained in the existing CCA, which are valid until the end of its term.
Can I change the clauses in the agreement?
Under the Mineral and Energy Resources (Common Provisions) Act 2014 (MERCP), the owner may negotiate changes to the clauses of the Agreement if both parties agree to the amendments. This is called a Material Change in Circumstance.
What is a Material Change in Circumstance?
As a new owner of a property, if you change the type of activity the land is being used for and this alters the compensation obligation or the future compensation obligation of a resource authority it may constitute a Material Change in Circumstance.
Similarly, when a resource company changes the nature, scope, or extent of operations in any resource activity this may also give rise to a Material Change in Circumstance.
These changes must relate to the compensation clauses set out in the current CCA or compensation agreement ordered by the Land Court or awarded by an arbitrator.
To be deemed a Material Change in Circumstance the effect of the change is considered rather than the change in activity. That is, if the difference in activity creates a change in compensatory effects that were not covered by the original compensation agreement and the change is relevant or essential, then the clauses contained within the CCA may be reviewed.
Negotiating a Material Change in Circumstance
If both the landholder and resource company cannot agree to the terms of a material change in circumstances, either party can apply to the Land Court to help with a determination. The Land Court can review how the original CCA is affected by the change in circumstances and establish if a material change in circumstances exists.
It is important to note that the Land Access Ombudsman cannot assist with the negotiation of a Material Change of Circumstance.
If you have questions about a dispute regarding the negotiation of a Material Change in Circumstances, it is best to seek advice from a qualified legal practitioner.
Additional information is available in the Department of Resources Guide to Land Access in Queensland.