Pacific Coal Co Pty Ltd v Perpetual Trustee Co (Ltd)

Pacific Coal Co Pty Ltd (appellant) and Perpetual Trustee Co (Ltd) (respondent) were parties to a dispute concerning rent and royalty payments owed under a coal mine lease. The respondent sued the appellant for an alleged balance of rent and royalty accrued between 1 January 1932 and 31 December 1950. The appellant contended that statutory enactments had reduced the amounts payable by 22.5%. The Supreme Court of New South Wales upheld the appellant's pleas regarding periods between 1 January 1932 and 31 December 1947, finding that royalties constituted "rent" under the relevant New South Wales legislation. However, the Supreme Court allowed demurrers to the appellant's pleas concerning later periods, which relied on a Commonwealth Prices Regulation Order. The appellant appealed this latter decision to the High Court.

The High Court was required to determine whether Prices Regulation Order No. 985, made under the National Security (Prices) Regulations, validly applied to the rent and royalties payable under the lease. Specifically, the Court needed to consider if the Order, which fixed maximum rates for mining rights based on amounts payable on 31 August 1939, was a valid exercise of the Commissioner's power, whether it applied retrospectively to a lease predating the Order, and how the "amount per ton of coal mined payable on 31 August 1939" should be calculated, particularly in light of the existing statutory deduction.

The High Court held that Prices Regulation Order No. 985 was a valid exercise of the Commissioner's power, interpreting the word "volume" in the regulations to include "quantity." The Court found that the Order applied to the rent and royalties under the lease, notwithstanding that the lease was entered into before the Order was made. Crucially, the Court determined that the "amount per ton of coal mined payable on 31 August 1939" referred to the amount reserved by the lease less the statutory deduction of 22.5% applicable at that time. Consequently, the High Court reversed the Supreme Court's decision regarding the demurrers to the pleas concerning the periods affected by the Prices Regulation Order, allowing the appellant's appeal in part.