Apart from the intervention of the Queensland government, which has coal royalties in its mind, the arguments being heard in the court seem to be all about iron ore. That view is understandable as the front man for the case is ore entrepreneur Andrew Forrest.

What Forrest hopes to achieve will have far-reaching implications for all forms of mining in Australia, and may even alter the way mining law operates. This includes things such as royalty rates and even land access, which have always been areas administered by the states.

Good, bad and/or ugly outcomes are possible once an argument spills over from political point-scoring to the “chamber of uncertainty” that is Australia’s High Court.

No one, for example, expected a land rights case taken by a man from an island in the Torres Strait to have widespread land access implications for the entire Australian mining industry.

Yet that is exactly what happened after Eddie Mabo won his case in the High Court when the judges found that an early form indigenous land title had existed before European settlement in Australia.

Forrest’s High Court case against the controversial MRRT could be a similar example of a legal argument producing unintended and unexpected consequences. The Hog sees them as three possible outcomes:

• The Good. This would be a High Court decision that finds the MRRT is a law that unfairly impinges on a state’s ability to levy royalties at a rate that would encourage mining. The court can only go that way on the ground that all federal laws must treat the states equally and as royalty rates stand they vary from state-to-state and a uniform mineral resource rent tax levied by the Commonwealth introduces inequality at a state level – a tricky but interesting argument
• The Bad. The High Court finds the federal government can apply a uniform “super” tax across the country on income from mining because it already has income taxing powers and variable state royalty rates are irrelevant, and it’s up to the states to make adjustments to fit in with the federal government as laws made in Canberra always override State laws
• The Ugly. This would be a “bad” High Court decision permitting the federal government to levy its MRRT, and leave open the potential for it to determine royalty rates, effectively removing that power from the states because it is the irregular nature of the state-by-state royalty regime that is causing the problem, not the uniform MRRT.

Perhaps it is only The Hog who can see the danger in what Forrest and the states of WA and Queensland have started in their appeal against the MRRT – and perhaps the “ugly” outcome is not possible.

However, look back 21 years to the time when the High Court ruled that the concept of “terra nullius”, a Latin expression for the land belonging to no one, was an invalid concept and that people such as Eddie Mabo and his fellow indigenous Australians did indeed have title to the land they had lived on for generations.

That decision has had far-reaching repercussions, with no mining company able to embark on an exploration or development project without checking carefully about the status of native claims to the land and agreeing on access terms with traditional owners.

The MRRT case is at the other end of the mining process, the bit at which tax and royalty rates are determined after a mine has been developed and after it is operating profitably.

Iron ore, which is very profitable at the moment, is the primary focus of what is being argued in the High Court. Coal, though, has just as much to gain (or lose) because it too is a target of the MRRT – and so too might be other minerals if the law is ever widened to take in all forms of mining as originally proposed in the forerunner to the tax, the Resource Super Profits Tax.

The key point being made by The Hog is that taking an argument over something seemingly as obscure as federal tax rates (and indigenous land title) can have far-reaching and unexpected outcomes.

The best possible result for mining is that the MRRT is found to be unconstitutional, turning it into a “hot button” issue at the federal election scheduled for September 14 – when an even higher court (the people) will decide the fate of a tax the conservative parties have already promised to abolish.

The worst possible outcome is that the High Court finds that the federal government can impose a “super tax” on specific minerals such as coal and iron ore, and it is the states that have to adjust their royalty rates to eliminate inconsistencies in what companies pay from state-to-state.

The potential then for Mabo-like “creep” of federal powers into other areas that have always been state responsibilities, such as land titles and land access, then becomes an ugly possibility.