Mineral Rights Lawyer
A DAY IN THE LIFE OF A MINING AND MINERAL LAWYER
- Introduction
In the normal course of business, the mining industry has to deal with various issues which invokes a variety of legal disciplines. Legal compliance is important and became more complex in recent times. As a result, these disciplines became the subject of legal specialisation. This overview is limited to Mining Law and related aspects. Other areas of specialization includes environmental Law, health and safety laws and employment law, dispute resolution and tax law ; - The right to prospect for and mine minerals
- In terms of the Mineral and Petroleum Resources Development Act no 28 of 2002 ("MPRDA") to right to prospect for and mine minerals are granted by the State, acting through the Minster of Mineral Resources and Energy ("DMRE").
- Mining Lawyers are required to advise their clients on acquiring such rights and the requirements thereof. In broad terms the requirements are proof that the proposed prospecting or mining operation can be undertaken optimally (a prospecting- or mining work programme must be submitted for approval for which technical input from geologists and mining engineers will be required) proof of financial and technical competence, submission of a Social And Labour Plan to ensure that the mining company will contribute to the social development of the area in which it will operate, and proof of compliance with the Mining Charter which serves to ensure that previously disadvantaged individuals, communities and employees will benefit from exploitation of the country's mineral resources. Acquiring prospecting and mining rights is a process regulated primarily by administrative law principles.
- Upon grant, prospecting and mining rights must be executed by a notary public (an additional qualification apart from being an attorney) and registered in the Mineral and Petroleum Titles Registration Office.
- Dealing with specific minerals
- Litigation
The MPRDA provides for administrative appeals if a person is aggrieved by an administrative decision taken by officials in the Department. Mining lawyers drafts the appeal setting out the legal principles and the grounds for an appeal. When administrative appeals are exhausted, the decision can be taken to the high court for judicial review. This is a litigation process where affidavits and other documents must be drafted setting out the facts the grounds for the appeal and the reasons why the appeal decision was wrong and should be reversed by the court. Various other disputes can be the subject of arbitration or court proceedings. Arbitration is a form of dispute resolution where the dispute is referred to an arbitrator for final adjudication instead of to a Court. - Opinions and Representations
Mining lawyers are frequently required to analyse the law and express legal opinions on a variety of legal questions.
When Legislative amendments are proposed, mining lawyers are required to make representations to the relevant government Department or to the relevant Parliamentary Portfolio committee on behalf of their clients. - Agreements
Prospecting and mining companies conclude a variety of agreements. Mining lawyers assist their clients in negotiating and drafting those agreement. Examples include Joint Venture agreements (a form of co-operation to develop a mining project) Share Sale and Purchase Agreements, Shareholders Agreements between shareholders, including BEE shareholders, Finance Agreements where financial institutions provide funding for prospecting or mining projects and Security Agreements and documentation (pledge of shares, notarial bonds over movable property and mortgage bonds over land and mining rights). Mining Companies frequently enter into agreements with service providers such as contract miners, transport contractors, mineral supply and offtake agreements, examples being coal supply agreements with Eskom and other coal users and international trade agreements where minerals are exported in respect of which their lawyers will assist them in advising on, negotiating and drafting the agreements.
- Conveyancing
Mining Companies acquire ownership of or contractual rights to use the land on which the conduct their operations. Mining lawyers will assist in negotiating, drafting and registering properties and rights in respect of properties in the Deeds Registry. Conveyancing is done by a conveyancer which is a qualification in addition to be an attorney. - Due Diligence Investigations
Clients frequently require legal due diligence investigations to be conducted on the matters of a target for acquisition or potential investors or for the listing of a company's shares on a stock exchange. In a legal due diligence investigation, the legal affairs of the entity being investigated are verified and a report issued thereon. That includes ownership of assets, contractual rights and obligations and statutory compliance and statutory liabilities (such as rehabilitation of environmental disturbances caused by mining.
- Day to Day Matters
On a day-to-day basis, mining lawyers will communicate with their clients telephonically or by email. In person or virtual meetings with clients, their other advisers take place regularly. In their offices they will draft the documents and agreements referred to above and implement the legal aspects of a transaction. In litigious matters pleadings and notices are drafted, consultations with counsel are conducted and court hearings attended. Liaison with officials in the DMRE takes place frequently. There is never a dull moment in the life of a mining and mineral lawyer!
Dealing in precious metals being gold and the platinum group metals (platinum palladium, rhodium ruthenium osmium and iridium) are regulated in the Precious Metals Act and dealing in diamonds are regulated in the Diamonds Act. These Acts impose restrictions and requires licences and permits to deal with the said minerals in certain forms (primarily unrefined forms of precious metals and unpolished diamonds). Mining Lawyers are frequently required to analyse the legislative provisions and to express opinions on whether certain activities are lawful or whether specific types of authorisations are required therefor.
Manus Booysen
Consultant
Webber Wentzel
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