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Newell, Virginia --- "Property Rights in Groundwater?" [1999] IndigLawB 77; (1999) 4(24) Indigenous Law Bulletin 4


Property Rights in Groundwater?[1]

by Virginia Newell

When faced with a legal question relating to the rights of Aboriginal and Torres Strait Islander peoples to groundwater, I discovered that very little had been written on the broader topic of legal rights to groundwater in Australia. In response, I have written an overview paper that looks firstly at the rights to groundwater that have been vested in the Australian states and territories and then at the property rights in groundwater that exist at common law. The final section aims to draw out a number of threads from the above issues that will be of relevance to those seeking to have native title rights to groundwater recognised.

1. Does legislation vest exclusive rights to groundwater in the Crown?[2]

There is a presumption at common law that parliaments do not alter fundamental common law principles except by express words. One such principle is that common law property rights are not extinguished by inconsistent legislation unless there is clear legislative intention to do so.[3]

What rights to groundwater are currently vested in the Crown?

In 1884 Alfred Deakin, the Attorney General of Victoria and Chairperson of the Royal Commission on Water Supply (Victoria), recommended that ‘the State should exercise the supreme control of ownership over all ... sources of water supply’.[4] Deakin reached this conclusion after visiting California and observing that extensive litigation appeared to be the result of allowing access to water to be governed by the common law. In response he drafted the Irrigation Bill 1886 to provide for the ‘sufficient nationalisation’ of water in Victoria.[5] However, the Victorian Parliament was alarmed at the concept of Crown ownership of water, which it viewed as an unacceptable break from the common law position. The Bill was amended and fell short of nationalising the water supply in that it did not expressly extinguish any common law rights to groundwater and in fact expressly recognised certain common law rights. This history is an important aid in construing later vesting provisions.

The Water Rights Act 1896 (NSW) was the first Australian Act of Parliament to employ the ‘right to the use, flow and control of water’ provision to vest rights to groundwater in the Crown.[6] This vesting provision is now used in the Australian Capital Territory,[7] Northern Territory,[8] New South Wales,[9] Queensland,[10] Victoria[11] and Western Australia.[12] The relevant Tasmanian legislation expressly leaves intact common law rights to groundwater[13] and does not vest primary access rights in the Crown. South Australia has implemented a novel water regime that applies to groundwater and which is discussed below.

Does the ‘use, flow and control’ formula vest exclusive or non-exclusive rights in the Crown?

It is indisputable that this formula provides the Crown with wide ranging rights to manage and regulate groundwater supplies in those jurisdictions which have adopted it. Yet the question of whether this formula vests exclusive rights to groundwater in the Crown or whether it allows the continued exercise of common law and native title rights, remains. The ordinary and natural meanings[14] of the words ‘use, flow and control’ do not suggest that the rights they vest in the Crown are exclusive. This conclusion is supported by the absence of words such as ‘ownership’, ‘property’ or ‘belongs to’.

In Hayes v Northern Territory[15] a vesting provision modelled on the ‘use, flow and control’ formula in the Water Act 1992 (NT) was considered and held by Justice Olney to vest non-exclusive rights in the Crown. His Honour’s reasoning shows that this conclusion was reached because the Act provided for the recognition of other common law rights (domestic use rights) to access and use groundwater.

In Yanner v Eaton (‘Yanner’)[16] the High Court held that Queensland legislation which provided that ‘all fauna, ... is the property of the Crown’ does not vest full beneficial or absolute ownership of the fauna in the Crown.[17] Further, they held that regulating the way in which rights and interests may be exercised is not necessarily inconsistent with the continuing existence of native title.[18] If the express legislative statement that ‘all’ fauna is the ‘property’ of the Crown is not sufficient to vest exclusive property rights in the Crown then it is unlikely that a court will find that the ‘use, flow and control’ formula vests exclusive rights in the Crown.

It follows that the Crown enjoys only non-exclusive rights to groundwater resources in the Australian Capital Territory, New South Wales, Queensland, Victoria and Western Australia. Other non-exclusive rights to groundwater could, therefore, at least theoretically coexist with the non-exclusive rights held by the Crown in these jurisdictions.

South Australia's novel approach to property in groundwater

In 1997, South Australia enacted the Water Resources Act 1997 with a view to facilitating the privatisation of water delivery services.[19] The key features of the Act with respect to groundwater are: it expressly abolishes common law rights to groundwater; it introduces a series of statutory rights; it ensures that the Crown has primary access rights to groundwater and it does not expressly vest any rights to groundwater in the Crown.[20] It would seem that South Australia viewed the extinguishment of common law rights to groundwater as a necessary precursor to the privatisation of its water supply. Remnant common law rights in that state may have posed a potential commercial threat in that, if asserted, they may have interfered with a private company’s ability to guarantee adequate supply to customers.

2. Common law rights to groundwater

The common law cases dealing with legal interests in groundwater were primarily decided in Britain in the late eighteenth century and early nineteenth century. These disputes arose almost without exception as a result of the industrialisation of Britain, when demands for larger quantities of water and demands for water of a certain quality meant that property rights in water became more competitive. Typically, these cases involved a community trying to secure an adequate supply of drinking water or a plaintiff whose rights to groundwater had been detrimentally affected by manufacturers, miners or canal developers.

There are limited Australian cases involving competing common law rights to groundwater, which is surprising given Australia’s aridity. These cases have, however, established that the British case law relating to rights to groundwater is applicable in Australia in spite of the different conditions of settlement, climate and geography.[21]

Non-exclusive common law rights to groundwater

The starting point is Blackstone's commentary relating to common resources, which supports the argument that common law rights to groundwater are non-exclusive:

There are some few things which, notwithstanding the general introduction and continuance of property, must still unavoidably remain in common, being such wherein nothing but a usufructuary property is capable of being had, and therefore they still belong to the first occupant, during the time he holds possession of them, and no longer such (among others) are the elements of light, air and water...[22]

Blackstone’s influence can be seen in early British cases such as Ballard v Tomlinson.[23] More recently, SD Clark argued that common law rights in groundwater in Australia cannot amount to exclusive possession.[24]

Are rights to groundwater linked to rights in land?

The common law cases strongly imply that rights to groundwater are an incident of rights to land.[25] However, exactly what rights to groundwater can be claimed by a landowner is not clear.

The maxim cujus est solum ejus est usque ad coelum et ad inferos[26] effectively means that a landowner is entitled to exclusive possession of whatever is in a direct line between the surface of the land and the centre of the earth. Whilst the maxim is often quoted, Australia and British courts have not applied it literally.[27]

While there are no common law cases addressing the depth to which ownership or possession extends below the surface of the land,[28] the reasoning used in common law cases dealing with the physical ownership of airspace may be applied by analogy. In the case of Bernstein v Skyviews and General Limited ( ‘Bernstein’),[29] it was held that the rights of a landowner to the airspace above his land was restricted to such a height as is necessary for the ordinary use and enjoyment of the land and the structures upon it. Applying Bernstein to groundwater, a landowner would be restricted to using only the groundwater necessary for the ordinary use and enjoyment of the land. This begs the question - how much water do landowners ordinarily need to use and enjoy their land?

It is also unclear whether a right to groundwater only attaches to exclusive rights to land (eg freehold) or whether non-exclusive rights in land (eg licences or non-exclusive native title rights) might also have certain rights to groundwater attached to them. In the case of Race v Ward,[30] customary rights to use water from a well were recognised at common law in addition to a customary right to traverse private land to access the well. This suggests that a person or group with a non-exclusive right to land could potentially have a non-exclusive right to the underlying groundwater.

3. Native title rights in groundwater at common law[31]

The arguments made out above are relevant to Indigenous peoples and in particular native title holders or applicants for the following reasons.

A. Non-exclusive rights to groundwater held by the Crown

Section one of this paper argued that the property rights in groundwater held by the Crown in seven of the eight Australian jurisdictions are not exclusive rights. This is significant when considering whether or not native title rights to groundwater are extant. The general rule is that native title rights to any groundwater resource will be extinguished to the extent of any inconsistency with rights granted or vested pursuant to legislation.[32] As the Crown's rights to groundwater are not exclusive, there is room for coexisting native title rights to be recognised. Further, in Ben Ward & Ors v State of Western Australia & Ors,[33] Justice Lee held that the impairment or regulation of Aboriginal rights will not necessarily extinguish the underlying native title rights.[34] Applying this to groundwater, the fact that Indigenous peoples have had their rights to groundwater regulated or have been prevented from exercising their right to groundwater does not necessarily mean that native title rights to groundwater have been extinguished.

B. The relationship between common law rights and native title rights

Common law and native title rights to groundwater are distinct rights: the former an incident of a land-title holding and the latter a right that Indigenous people may possess in accordance with their traditional laws and customs. While these rights are distinct, native title rights are recognised in Australia by the common law.[35] It is evident from judgments that the content of native title rights are often equated with similar common law property rights in judgments[36] in spite of the fact that native title rights are said to be sui generis[37] and not derivative of ordinary common law rights.[38] Further in Yanner, the fact that the common law does not recognise exclusive property rights in wild animals, was relied on in the majority judgment to find that the word ‘property’ could not be construed as vesting exclusive rights in the Crown.[39] This reasoning is significant because groundwater, like wild animals, cannot be the subject of exclusive property rights at common law. It suggests that the nature of the common law rights that have been recognised in a given property will serve to limit the extent of rights that will be recognised as being vested in the Crown.

C. The situation in South Australia

Section 7(9) of the Water Resources Act 1997 (‘the WRA’) states that ‘rights at common law in relation to the taking of naturally occurring water are abolished’. Does an express legislative provision extinguishing common law rights in groundwater simultaneously extinguish native title rights to groundwater? Native title is not expressly mentioned in the legislation or in the extrinsic material which may be significant in construing the legislation. Nevertheless, the intention to abolish all non-statutory rights to groundwater was an express object of the legislation.

If it is argued that native title rights to groundwater in South Australia have been extinguished by the WRA, could it then be challenged on the grounds that it is inconsistent with the Racial Discrimination Act 1975 (‘the RDA’). Section 10(1) of the RDA ensures that Indigenous Australians who hold native title rights to land have the same security of enjoyment for these rights as others who are holders of title granted by the Crown. In Mabo v Queensland (No.1),[40] the relevant Queensland legislation was found to extinguish property rights in a discriminatory way and was accordingly held to be void due to inconsistency with the RDA. The WRA does not appear to have discriminated against persons of a particular race, colour or national or ethnic origin. South Australia’s intention was to extinguish all non-statutory rights to groundwater: native title rights and other common law rights alike. It will be relevant to determining if there has been discrimination to determine if the groundwater management practices and regulations in South Australia were such that other land title-holders were still able to exercise common law rights to groundwater. Such considerations are relevant to whether the Water Resources Act offers formal or substantive equality to Indigenous South Australians.

In conclusion, I offer the following observations:

1. Legislation vesting ‘use, flow and control’ of groundwater in the Crown is not likely to be construed as vesting exclusive property rights in the Crown.

2. Leaving native title aside, Indigenous and non-Indigenous Australian landowners (outside of South Australia) may still possess common law rights to groundwater because state and territory legislation has not expressly extinguished such rights. The extent of these rights and the landowner’s ability to exercise them will depend on the extent of the water management and regulation schemes in place in that area.

3. Common law rights to groundwater constitute non-exclusive rights to groundwater. This is likely to limit the Crown’s ability to argue that they possess exclusive rights to groundwater especially if common law rights have been regulated but have not been expressly extinguished.

4. Landowners, and in particular native title-holders, should be alert to the possibility that other jurisdictions could seek to follow South Australia’s lead and enact legislation that extinguishes common law rights to groundwater. Such legislation could possibly also extinguish native title rights to groundwater.

Virginia Newell is a practicing solicitor at Dunhill Madden Butler, Canberra.


[1] This paper is an abridged and updated version of an Honours thesis submitted in 1997.

[2] My survey of the legislation in force in the states or territories is limited to looking at the current legislation vesting rights in the Crown.

[3] Crafter v Kelly [1941] SAStRp 45; [1941] SASR 237 at 239.

[4] A Maas, Water Law and Institutions in the Western United States: Comparisons with Early Developments in California and Australia and Recent Legislation (Western Water Policy Project, Discussion Series No. 7, Natural Resources Law Center at the University of Colorado School of Law, 1990) 16.

[5] R Sackville and MA Neave, Property Law: Cases and Materials (1971), 1063; SD Clark and AJ Myers, ‘Vesting and Divesting: The Victorian Groundwater Act 1969[1969] MelbULawRw 22; (1969) 7 Melbourne University Law Review 237, 242-244.

[6] Sackville and Neave, above n 5, 1063.

[7] Water Resources Act 1998 (NSW) s 13.

[8] Water Act 1992 (Cth) s 9(2).

[9] Water Administration Act 1986 (NSW) s 12(1).

[10] Water Resources Act 1989 (Qld) s 3.

[11] Water Act 1989 (Vic) s 7.

[12] Rights to Water and Irrigation Act 1914 (WA) s 26.

[13] Groundwater Act 1985 (Tas) s 6.

[14] Amalgamated Society of Engineers v Adelaide Steamship Co Ltd [1920] HCA 54; (1920) 28 CLR 129 , 161-162.

[15] [1999] FCA 1248.

[16] [1999] HCA 53.

[17] Ibid, para 4 & 28 (Gleeson CJ, Gaudron, Kirby & Hayne JJ); para 110 (Gummow J). McHugh and Callinan JJ each handed down strong dissenting judgments.

[18] Ibid para 37 (Gleeson CJ, Gaudron, Kirby & Hayne JJ). Note the qualification in footnote 58 of the majority judgment - that regulation can ‘shade into prohibition’.

[19] South Australia, Parliamentary Debates, House of Assembly, 13 November 1996, 539 (The Hon DC Wotton, Minister for the Environment and Natural Resources). Cf JEL Scanlan, ‘SA Government “Going all the Way” With Water Reform’ (1996) 13(1) Environmental and Planning Law Journal 5.

[20] Water Resources Act 1997, s 6 & 7.

[21] Dunn v Collins [1867] SALawRp 16; (1867) 1 SALR 126; Gartman v Kidman [1962] HCA 27; (1962) 108 CLR 12, 21-23.

[22] 2 Black Com 14.

[23] (1885) LR 29 Ch D 115.

[24] SD Clark, Groundwater Law and Administration (Department of National Development Australian Resources Council, Research Project No. 73/50); (Australian Water Resources Council, Technical Paper No. 44, 1979) 28.

[25] See Ballard v Tomlison (1885) LR 29 Ch D 115, 122.

[26] For discussion of the maxim see Bernstein v Skyviews and General Ltd [1977] EWHC 1; [1978] QB 479, 487.

[27] Commissioner of Railways v Valuer General [1974] AC 328, 351-352.

[28] P Butt, ‘Real Property: Physical Limits to Land: Depth Limitations (Chapter 3)’ 28 The Laws of Australia 15.

[29] [1977] EWHC 1; [1978] QB 479, 488.

[30] [1857] EngR 239; (1857) El & Bl 383; 119 ER 1289.

[31] A discussion of the process of claiming native title rights to groundwater pursuant to the Native Title Act 1993 is beyond the scope of this paper.

[32] Western Australia v Commonwealth [1995] HCA 47; (1995) 128 ALR 1, 21.

[33] [1998] 1478 FCA.

[34] Justice Lee differentiates Aboriginal rights from native title rights. Aboriginal rights are the rights to use land or resources in accordance with customary law. Native title rights are the rights recognised at common law as a result of the continued existence of Aboriginal rights.

[35] Mabo v Queensland (No. 2) [1992] HCA 23; (1992) 175 CLR 1 (‘Mabo No.2’), 48-52, 56, 60 (Brennan J with whom Mason CJ and McHugh J agreed); 83-6, 89-90, 101-2 (Deane and Gaudron JJ); 184-192 (Toohey J).

[36] See eg Mabo (No 2), 61 (Brennan J); 110 (Deane and Gaudron JJ). Cf Wik Peoples v State of Queensland (1996) 187 CLR 1 (‘Wik’) & 129.

[37] Mabo (No 2), 89 (Deane and Gaudron JJ); Wik, 213 (Kirby J).

[38] Mabo (No 2), 48-52, 56, 60 (Brennan J with whom Mason CJ and McHugh J agreed); 83-86, 89-90, 101-102 (Deane and Gaudron JJ); 184-192, 194-195 (Toohey J).

[39] [1999] HCA 53, 24.

[40] (1988) 166 CLR 186.


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