Victorian Consolidated Legislation

Forests (Laminex Industries Agreement) Act 1989 - SCHEDULE

s. 3 LAMINEX INDUSTRIES AGREEMENT This agreement is made the 18th day of
October One thousand, nine hundred and eighty nine between: The Treasurer,
State of Victoria, of the first part and: The Minister for Conservation,
Forests and Lands of the second part and: Director-General of Conservation,
Forests and Lands incorporated by the provisions of the
Conservation, Forests and Lands Act 1987 of the State of Victoria of the third
part and: ACI Australia Limited which is a Company incorporated in the State
of Victoria and having its registered office at 390 St Kilda Road, Melbourne
and trading as "Laminex Industries". of the fourth part WHEREAS:
I. The Company has for some time been engaged in large scale operations in
connection with the manufacture of particle board at Ballarat in the State of
Victoria.
II. The Company desires to be satisfied that sufficient softwood timber will
be available to it over a period of time which will enable it to continue its
operations at Ballarat.
III. The Government of the State of Victoria desires to provide a means by
which the Company can be assured to its long term supply of softwood timber
and which also ensures that the public of Victoria receives an adequate return
to cover the costs of certain forest production activities.
IV. The parties hereto desire to enter into this Agreement so that upon an
enabling Act being passed by Parliament and coming into operation the
provisions hereinafter appearing shall have full force. Now it is hereby
agreed as follows: PART I-PRELIMINARY 1. In this Agreement unless inconsistent
with the context or subject matter: "the Act", means the Act of the Parliament
of Victoria to be passed to ratify, validate, approve and otherwise give
effect to this Agreement; "this Agreement" includes this Agreement as from
time to time amended, supplemented or novated and includes all Schedules
hereto and conditions which the Director-General shall from time to time
determine to apply in accordance with Clause 23; "area of supply" means
softwood plantations existing from time to time in State forest within the
area delineated on the map annexed hereto; "Director-General" means the body
corporate established by Part 2, Conservation, Forests and Lands Act 1987;
"Company" means ACI Australia Limited trading as Laminex Industries, and if in
accordance with Clause 4 of this Agreement a subsidiary company is
incorporated or the rights of the Company are assigned to any company includes
that subsidiary or assignee company; "date of commencement" means the same day
as the date of commencement of the Act; "forest officer" has the same meaning
as in the Forests Act 1958; "forest produce" has the same meaning as in the
Forests Act 1958; "the industry" means the manufacture by the Company near
Ballarat of particle board from softwood timber; "minimum annual supply" means
70 000 cubic metres per annum of softwood timber; "Minister" means Minister
for Conservation, Forests and Lands; "month" means calendar month; "softwood
timber" means timber of the species Pinus radiata, Pinus nigra, Pseudotsuga
menziesii and other species suitable for the manufacture of particle board but
does not include any timber which the Director-General requires for sale as
sawlogs, veneer logs, poles or fencing timber; "roading charge" means the
charge determined by the Director-General which is levied from time to time on
all forest product extracted from forests to cover the cost of maintenance,
improvement and construction of forest logging roads; "State forest" has the
same meaning as in the Forests Act 1958; "year" means a period of twelve
months commencing on the first day of July. 2. (1) In this Agreement unless
inconsistent with the context or subject matter references to any Act shall
include all amendments and re-enactments thereof for the time being in force
and all supplemental legislation for the time being in force whether by
regulation, rule, proclamation or order made or continuing under that Act or
any amendment or re-enactment thereof.

(2) The headings and side notes shall not affect the interpretation of this
Agreement. 3. This Agreement shall not be of any force or effect until it has
been ratified validated, approved and otherwise given effect by an Act of the
Parliament of Victoria. 4. (1) The Company shall be at liberty at any time
with the prior written consent of the Director-General to assign its rights
under this Agreement to a subsidiary company or any other company.

(2) After such assignment the following provisions shall have effect:

   (a)  The subsidiary or assignee company shall by virtue of the Act be
        subject to all the obligations and conditions imposed upon the Company
        by this Agreement so far as they remain in force and are capable of
        taking effect.

   (b)  The Company shall remain responsible to the Director-General for the
        performance of all its obligations under this Agreement as if no
        subsidiary company had been formed or assignment made.





PART II-OPERATION OF INDUSTRY Division A-Duration of Agreement 5. This
Agreement shall remain in force until 30 June 2010 or until sooner
determination in accordance with the provisions hereof. 6. The expiration or
determination of this Agreement shall not affect the enforcement of any right,
obligation or liability theretofore acquired, accrued or incurred. Division
B-Timber Rights 7. Nothing in this Agreement shall affect the rights, powers
and privileges already acquired by any person under the Forests Act 1958 or
any other Act. 8. Subject to the right of the Company under sub-clause (1) of
Clause 11 hereof to obtain softwood timber in the area of supply and subject
to compliance by the Director-General with obligations under paragraph (a) of
Clause 12 hereof to make available to the Company the minimum annual supply of
softwood timber nothing in this Agreement shall restrict the
Director-General's rights pursuant to the Forests Act 1958 to sell or grant
licences to obtain forest produce. 9. (1) Not later than the thirty-first day
of March in each year the Director-General shall draw up and deliver to the
Company a plan of utilisation for the supply of softwood timber for the
following year and a provisional plan for the supply of softwood timber for
the next two years.

(2) The plan of utilisation and the provisional plan shall set out the
locations from which softwood timber may be obtained during the relevant
period and shall specify the specific location area in hectares and the
respective quantities of softwood timber which the Director-General estimates
will be obtainable in each area.

(3) The Director-General and the Company may during the currency of any plan
of utilisation agree to a modification of the plan.

(4) The Company shall conform with each plan or modified plan of utilisation.

10. The Company shall comply with the provisions of the Forests Act 1958, with
all regulations for the time being in force under the Forests Act and with the
Code of Forest Practices for Timber Production and other relevant Codes of
Practice for the time being in force under the
Conservation, Forests and Lands Act 1987. 11. (1) Subject to the provisions of
this Agreement the Company without obtaining any lease permit or authority
shall have the right to obtain softwood timber by its servants, agents or
contractors from the area of supply.

(2) The Company shall obtain softwood timber from-

   (a)  heads and other parts of trees remaining from logging and pole and
        post cutting operations;

   (b)  all standing trees indicated by a forest officer; and

   (c)  as required by the Director-General from timber felled or felled and
        removed by or on behalf of the Director-General.

(3) The Director-General may in its discretion if so requested by the Company
modify the Company's obligation to take softwood timber felled or felled and
removed by or on behalf of the Director-General but any of such timber not
taken by the Company shall for the purposes of paragraph (a) of Clause 12
hereof be softwood timber made available to the Company by the
Director-General. 12. The Director-General-

   (a)  shall subject to the provisions of Clause 26 hereof be bound in each
        year to make available to the Company the minimum annual supply of
        softwood timber from the area of supply; and

   (b)  may in its discretion make available to the Company in any year a
        quantity of softwood timber from the area of supply additional to the
        minimum annual supply. 13. The company shall not be bound to accept
        any softwood timber which-

   (a)  is not sound, clean and free from rot doze blue stain and charcoal;

   (b)  is not sufficiently straight for the manufacturing processes for the
        time being employed in the industry due to-

   (i)  sweep equal to or exceeding twice the centre diameter underbark for a
        3·0 m log length;

   (ii) presence of forks or swellings where the log diameter varies by more
        than 30% over a 1·0 m length;

   (iii) bends involving deviation of the longitudinal axis of the log in
        excess of 20º over a 1·0 m length;

   (c)  is less than 3·0 metres in length or such other minimum length as is
        agreed to from time to time by the Director-General and the Company;
        or

   (d)  is less than 10 cms or more than 40 cms in sectional dimension
        underbark. 14. (1) For all softwood timber obtained by it under this
        Agreement the Company shall pay-

   (a)  as to softwood timber which the Company by its servants, agents or
        contractors removes or fells and removes the royalty and roading
        charges payable from time to time under this Agreement; and

   (b)  as to softwood timber either felled or felled and removed by or on
        behalf of the Director-General the royalty and roading charges as
        aforesaid and a charge to be agreed upon from time to time between the
        Director-General and the Company for-

   (i)  the cost to the Director-General of felling and removal of softwood
        timber in or from the particular area; and

   (ii) the overhead expenses of the Director-General in connection therewith.

(2) Failing agreement within fourteen days on the charge referred to in
paragraph (b) of sub-clause (1) hereof the charge shall be determined by the
Director-General but so that the charge for the cost of felling or felling and
removal of softwood timber in or from any area shall be comparable to the cost
generally incurred by the Company for felling and felling and removal (as the
case may be) of softwood timber at that time in similar form in or from areas
which are similar with respect to yield of softwood sawlogs physical
circumstances of extraction and situation in regard to means of transport
provided that the arbitration provisions in Clause 27(3) shall be applicable
to the Director-General's determination. 15. (1) Subject to the provisions of
Clause 26 hereof the Company shall be bound in each year in which the minimum
annual supply of softwood timber to which it is entitled in that year is
available to it either-

   (a)  to take not less than 90 per centum of the minimum annual supply; or

   (b)  if it takes less than 90 per centum of the minimum annual supply to
        pay royalty to the Director-General on the deficiency at a rate equal
        to the average of the royalty rates payable in that year under Clause
        17 or 18 hereof.

(2) If the Company during either or both of the two years next following any
year in which there is a deficiency obtains a quantity of softwood timber in
excess of the minimum annual supply the royalty payable on such excess shall
be reduced by the amount of royalty paid in respect to the deficiency. 16. The
following provisions shall apply with respect to royalty and roading charges
payable under this Agreement:

   (a)  Royalty and roading charges shall be payable after the amounts have
        been ascertained by weighing and/or measuring in accordance with this
        Agreement.

   (b)  Accounts for royalty and roading charges shall be issued monthly.

   (c)  An account issued for royalty and roading charges is due for payment
        immediately it is rendered and becomes overdue if not paid by 30 days
        from the date the account is rendered.

   (d)  If royalty and roading charges are not paid after becoming overdue the
        Company shall pay interest on the sum due but unpaid from the date the
        sum became overdue at the rate for the time being fixed under
        Section 30 of the Conservation, Forests and Lands Act 1987.

   (e)  If an account for royalty and roading charges remains overdue for more
        than 14 days the Director-General may without limiting the obligations
        of the Company under Clause 15 hereof by notice in writing to the
        Company suspend its right to obtain softwood timber under this
        Agreement until payment is made.

   (f)  If the Company disputes the amount of any payment demanded by the
        Director-General it may make the payment under protest and thereafter
        shall be entitled to take proceedings for recovery of any amount in
        excess of the amount it was liable to pay.

17. (1) During the period from the date of commencement of this Agreement to
30 June 1993 the combined royalty and roading charges payable shall be at the
rates set out in the Schedule to this Agreement.

(2) During each successive period of three years thereafter the royalty rates
and the roading charges payable shall be determined separately as provided for
in Clauses 18 and 19. 18. (1) In respect of each successive three year period
from 1 July 1993 the royalty payable shall be at the rates agreed upon by the
Director-General and the Company, and failing agreement not later than
fourteen days after the next publication by the Commonwealth Bureau of
Statistics of figures referred in sub-clause (2), to be determined as provided
for below.

(2) In the event of failure to agree on or before the date provided for in
sub-clause (1) the royalty rates will be calculated by varying the royalty
rates payable during the preceding period of three years in the same
proportion as the average of the proportional variation in the figures at the
beginning and the end of that period in regard to-

   (a)  the Average Weekly Earnings per Employed Male Unit: Victoria; and

   (b)  the Price Index of materials based in building other than house
        building: Wood and Wood Products. Published by the Commonwealth Bureau
        of Census and Statistics Provided that in respect of the royalty rates
        to be determined for the period 1 July 1993 to 30 June 1996 for the
        purpose of determining the royalty rates payable during the preceding
        period of three years, the Director-General will subtract the roading
        charge determined by it for the Ballarat Softwood Management Area for
        the period 1 July 1992 to 30 June 1993 from the royalty and roading
        charges set out in the Schedule to this Agreement.

(3) If the Commonwealth Bureau of Census and Statistics ceases to publish the
figures referred to in either paragraph (a) or (b) or sub-clause (1) hereof a
new method of calculating any variation in the royalty rates shall be agreed
upon by the Director-General and the Company or failing agreement shall be
determined by the Director-General.

(4) If any variation in the royalty rates is not determined prior to the
commencement of any new three yearly period the Company shall continue to pay
royalty at the rates payable during the preceding three yearly period and as
soon as the new rates have been determined an adjustment on the sum due shall
be made retrospectively to the commencement of the new three yearly period.
The Director-General may in his discretion determine that interest shall be
payable in addition to the retrospective payments. 19. With respect to each
successive three year period from 1 July 1993 a roading charge shall be
payable on all softwood timber removed the amount of which is to be a charge
per cubic metre determined by the Director-General from time to time in light
of projected expenditure on timber extraction roads accessing softwood
plantations in the Ballarat and Otways Softwood Management Areas and regard to
advice of the Forest Management Area Roading Advisory Committees on which the
Company may at its option be represented. 20. (1) From 1 July 1990 in addition
to royalty and roading charges payable in accordance with Clause 14 hereof an
annual licence fee shall be paid by the Company to the Director-General as
provided for in this clause with respect to the right of the Company to cut
and remove softwood timber as provided in Clause 11(2) hereof.

(2) The annual licence fee with respect to softwood required to be made
available to meet the minimum annual supply will be due and payable on the
30th day of June. The Director-General may in his discretion determine that
the annual fee may be paid in six monthly instalments.

(3) The annual licence fee shall be at the rate of $1.00 per cubic metre for
the year commencing 1 July 1990 ("the base fee") and for each of the years
commencing on the first day of July for the following two years the base fee
will be adjusted in the same percentage rate as the rate of change in the
royalty rate for that year.

(4) The amount of annual licence fee will be reviewed between 1 April 1993 and
30 June 1993 and thereafter between the first day of April and the 30th day of
June at successive three yearly intervals and so that-

   (a)  a review is to be conducted by the Director-General and the Company
        jointly;

   (b)  the review will establish if a new base fee shall apply and if so at
        what rate, for the succeeding three years;

   (c)  the review will take account of-

   (i)  the ongoing ability of the Company to maintain its competitive
        position in domestic and international panel products markets taking
        into account circumstances not of its own making;

   (ii) changes in the average domestic market price of particle board
        relative to general cost increases in the community as measured by the
        consumer price index;

   (iii) changes in the landed price of imported particle board and related
        products, relative to economy wide indices of capital and labour
        costs;

   (iv) the benefit of the special rights granted to the Company under this
        Agreement;

   (d)  the review will last no longer than the 30th day of June in the year
        in which it commenced. In the event that agreement is not reached
        between the Director-General and the Company on or before that date
        the matter shall be determined by the Director-General;

   (e)  any new base fee so determined will be adjusted in each of the
        subsequent two years, similarly as set out in sub-clause (3) hereof.
        21. The Company shall not within the area of supply construct any road
        track or passage or any chute without the prior written consent of a
        forest officer and shall not construct any tramway flume or building
        or erect any haulage or conversion unit without the prior written
        consent of the Director-General. 22. (1) The quantity of softwood
        timber upon which royalty and roading charges are payable under this
        Agreement shall be determined in such manner provided that allowance
        shall be made for bark as may be agreed upon by the Director-General
        and the Company or failing agreement within thirty days as the
        Director-General may direct.

(2) If the royalty and roading charges so payable are to be determined by
mass-

   (a)  the Company shall provide at its Ballarat plant a weighbridge of a
        pattern which meets the requirements of the Weights and Measures Act
        1958 and shall while this Agreement remains in force have the
        weighbridge maintained and periodically verified and stamped in
        accordance with the provisions of that Act and shall operate the
        weighbridge in accordance with the reasonable requirements of the
        Director-General;

   (b)  at all times while the weighbridge is in accurate working order the
        quantity of softwood timber upon which royalty and roading charges are
        payable under this Agreement shall be determined by weighing it on the
        weighbridge; and

   (c)  at all times while the weighbridge is not in accurate working order
        the quantity of softwood timber upon which royalty and roading charges
        are payable under this Agreement shall be determined in such manner as
        may be agreed upon by the Director-General and the Company or failing
        agreement as the Director-General may direct. 23. The Director-General
        may from time to time give to the Company written notice of conditions
        which shall apply in the areas from which it is obtaining softwood
        timber under this Agreement and the Company shall comply with the said
        conditions and ensure that any contractors who are engaged in
        obtaining softwood timber under this Agreement have notice thereof.
        24. (1) The Company shall inform the Director-General in writing from
        time to time of the names of its servants, agents and contractors who
        are engaged in obtaining softwood timber under this Agreement.

(2) The Company shall supply to each person for production when required by a
forest officer evidence in a form satisfactory to the Director-General that he
is engaged in obtaining softwood timber under this Agreement and the Company
shall forthwith inform the Director-General in writing whenever any such
person ceases to be so engaged. (3) (a) The Company shall include in every
contract by it with a contractor for obtaining softwood timber under this
Agreement provisions requiring the contractor to comply with the
Forests Act 1958 the regulations made under the Act and the conditions
referred to in Clause 23 hereof which are applicable to the contractor the
conditions referred to in Clause 10(2) hereof which are applicable to that
contractor and with the Code of Forest Practices for Timber Production and any
other relevant Codes of Practice for the time being in force under the
Conservation, Forests and Lands Act 1987.

   (b)  The Company shall upon making any such contract forthwith give to the
        Director-General written notice of the contract specifying the name of
        the contractor the duration of the contract and the quantity of and
        area from which softwood timber is to be obtained thereunder.

(4) The Company shall if so required by the Director-General terminate the
contract of any contractor who in the opinion of the Director-General has
failed to comply with the Forests Act 1958 the regulations made under the Act
or the conditions referred to in Clause 23 hereof. 25. (1) In the first three
months of the last year of this Agreement the Director-General shall if the
Company seeks a further Agreement to assure to it supplies of softwood timber
for the continuation and expansion of the industry investigate the development
of the industry and if satisfied that the Company needs to have supplies of
softwood timber assured to it by a further Agreement enter into negotiations
with the Company for that purpose.

(2) When or if a further Agreement has been agreed upon and executed the
Director-General shall (if necessary) recommend to the Minister that a Bill be
introduced into the Parliament of Victoria as soon as possible to ratify,
validate, approve and otherwise give effect to it. Division C-Suspension of
Obligations and Conditions 26. If any of the softwood plantations in the area
of supply are damaged or destroyed by fire, disease or other cause to such an
extent that it is impracticable for the Director-General to comply with the
provisions of paragraph (a) of Clause 12 hereof or if by reason of anything
whatsoever beyond the control of the Director-General it is prevented from
complying with those provisions the Company shall have no claim against the
Director-General for the non-fulfilment of its obligations under those
provisions so far as non-fulfilment is due to any such cause. 27. (1) If-

   (a)  the Company's plant or any works used by it in the production of
        particle board near Ballarat are damaged or destroyed by fire or other
        calamity to an extent sufficient to prevent production of particle
        board for softwood timber at a rate not less than 250 tonnes per
        month;

   (b)  by reason of anything beyond the control of the Company it is
        prevented from carrying on production of particle board from softwood
        timber at a rate not less than 250 tonnes per month; or

   (c)  by reason of any change in the economics of the industry the carrying
        on of the industry becomes commercially impracticable or the continued
        performance by the Company of its obligations under Clause 15 hereof
        would affect it unfairly then in any of those events- then sub-clause
        (2) shall apply.

(2) If any of the events specified in sub-clause (1) of this clause occur and
continue for more than 30 days then-

   (a)  the company may apply to the Director-General for suspension or a
        reasonable modification of the extent or operation of the said
        obligations or for an extension of time for the performance or
        observance thereof;

   (b)  the Director-General upon any such application by the Company may
        grant a suspension of all or any of the said obligations or a
        reasonable modification of their extent or operation or an extension
        of time for their performance or observance;

   (c)  if the Company is dissatisfied with the decision of the
        Director-General upon any such application the matter shall if the
        Company so elects be submitted to arbitration.

(3) Arbitration pursuant to the preceding sub-clause shall be effected as
follows:

   (a)  The matter shall be referred to two arbitrators one to be appointed by
        the Company and one by the Director-General.

   (b)  The provisions of the Commercial Arbitration Act 1984 shall apply to
        the reference.

   (c)  The arbitrators and any umpire appointed for the purpose of the
        reference shall decide what is fair and reasonable having regard to
        the terms of this Agreement and the circumstances existing at the time
        of the reference.

(4) The arbitrators or umpire or some person appointed on their behalf may
investigate the Company's affairs and accounts so far as may be necessary to
assist them to determine any matter referred to them and the Company shall
give them full access to all accounts and papers necessary for that purpose
and shall afford them full information and assistance. Division
D-Determination of Agreement by Director-General 28. If the Company-

(1) enters into liquidation (other than a voluntary liquidation for the
purposes or reconstruction and assignment of rights under this Agreement).

(2) ceases production of particle board or other panel products approved by
the Director-General.

(3) contravenes or fails to comply with the terms and conditions of this
Agreement. the Director-General may thereupon determine this Agreement.
Division E-Supplemental 29. The Director-General and the Company may by
agreement-

   (a)  from time to time amend this Agreement by such additions, deletions
        and variations of matters of detail as may be necessary or desirable
        to facilitate the carrying on of the industry; and

   (b)  at any time determine this Agreement upon such terms as they deem fit.
        30. Notwithstanding anything else provided in this Agreement the
        Company may determine this Agreement by the giving of five years'
        notice in writing to the Director-General, and after that time all
        obligations of the Company and the Director-General pursuant to this
        Agreement will cease. 31. The Minister approves this Agreement.





In witness whereof the parties hereto have executed as a deed this Agreement
the day and year first before written. Signed sealed and delivered by the
Honourable, the Treasurer in the presence of: R. A. JOLLY L.S. S.
POSTLETHWAITE Signed, sealed and delivered by the Honourable, the Minister for
Conservation, Forests and Lands in the presence of: K. SETCHES L.S. GAVIN
JENNINGS The common seal of Director-General of Conservation, Forests and
Lands was hereunto affixed in the presence of: L. FOSTER L.S. K. HARBECK The
common seal of ACI Australia Limited, was hereto affixed by authority of the
Directors in the presence of: L.S E. B. TURNER, Director GEOFF ROBERTSON,
Secretary Schedule Royalty and Roading Charges (Clause 17) The royalty and
roading charge per cubic metre of Softwood Timber shall be determined by the
distance the place of harvesting of the timber and the Company's plant, as
follows: (1) Where the distance is less than or equal to 50 kms, the maximum
rate set out in the table below; (2) Where the distance is greater than 50
kms, the maximum rate shall be reduced by the distance allowance set out in
the table below, provided that the charge shall not be reduced below the
minimum rate set out in the table below.

Period Ending

Maximum Rate $/m3

Minimum Rate $/m3 Distance Allowance Cents/km/m3 30.6.1991 $16.00 $10.50 10×0
30.6.1992 $16.96 $11.13 10×6 30.6.1993 $17.98 $11.80 11×2

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