Theseus Exploration NL v Foyster

Theseus Exploration NL (the appellant) appealed to the High Court of Australia from a judgment of the Supreme Court of New South Wales. The dispute concerned the appellant's entitlement to a share of the profits derived from the sale of certain mining tenements, which had been assigned to the respondent, Mr Foyster, by a company known as North Broken Hill Ltd. The appellant contended that it had a contractual right to a share of these profits.

The High Court was required to determine whether the appellant had established a legally enforceable right to a share of the profits arising from the sale of the mining tenements. Specifically, the court had to consider the interpretation of the relevant contractual provisions and whether they created a personal obligation on the part of North Broken Hill Ltd to pay a share of the profits to the appellant, or whether the obligation was one that ran with the land or was otherwise enforceable against the respondent as the assignee of the tenements.

The court analysed the terms of the agreement between the appellant and North Broken Hill Ltd, finding that it created a personal covenant to pay a share of profits, rather than a proprietary interest in the tenements themselves. As the respondent was not a party to this original agreement and had acquired the tenements without notice of the appellant's claim, the High Court held that the respondent was not bound by the appellant's contractual right. The principle applied was that a personal covenant does not generally bind a subsequent assignee of land unless there is a specific statutory provision or equitable doctrine that makes it so, which was not established in this instance.

The appeal was dismissed.