A man’s home is his castle

The movie The Castle portrayed an ordinary Australian family determined to exercise one of their freehold land rights – namely, to stay put. They succeeded; the High Court, empowered by the Constitution, quashed the Commonwealth government’s attempt to confiscate the fictional Kerrigan’s family home to build an airport.

Disgruntled farmers in Queensland and New South Wales, concerned about the recent encroachment of coal seam gas exploration on their land, may identify with the Kerrigan family’s plight; however, landowners own only the top soil and not the minerals under their land – state governments do.

Since the 1850s, Australian states have passed legislation to acquire minerals under the ground. Most recently in 1981, the Wran government’s Coal Acquisition Act in NSW unilaterally confiscated all coal in the state, regardless of who had owned the land or the coal. As for compensation, ‘the governor… may make arrangements.’

Property rights obviously are not well protected by our state constitutions. However, whatever the iniquity of that legislation, it will not be undone by arbitrarily giving the coal under the ground to farmers. They had never owned the coal, and they knew that when they bought the land.

When Blackstone wrote his Commentaries in 1766, freehold title was meant to include the ground below the surface and the air above it, without limit. Applied today, owners could stymie subways or make the landing of a 747 difficult. Such extensive rights are obviously less practical today, and freehold title no longer includes such untrammelled rights.

Nevertheless, we do have a right to the adjacent soil and air in so far as they are necessary for owners’ full use or enjoyment of their property. If prospecting for coal inconveniences farmers on their property, they are entitled to compensation. If mining or prospecting impairs the productivity of farmers’ land, say by affecting the water table, they should get fair recompense.

These ownership rights should already exist in the common law, regardless of whether state governments have ultimate claim to subterranean minerals. If they have been eroded by state legislation, states must remove the offending laws.

Ideally, farmers and miners should negotiate mutually satisfactory terms directly. If mining is more profitable than farming, farmers will have a financial incentive to let the mining or prospecting proceed, perhaps even selling all their land rights to miners. Conversely, if commodity prices suddenly fall, land could be sold back to farmers.

Once private property rights are clearly defined, the right amount of farming and mining can occur, and no farmer or miner could rightfully be upset.

Adam Creighton is a Research Fellow at The Centre for Independent Studies.