Brown v NBT Pty Ltd [2016] QLC 64

LAND COURT OF QUEENSLAND CITATION: Brown v NBT Pty Ltd [2016] QLC 64 PARTIES: Stephen John Brown (applicant) v NBT Pty Ltd ACN 001 945 446 (respondent) FILE NO/s: MRA217-16 DIVISION: General Division PROCEEDING: Determination of compensation for renewal of a mining lease. DELIVERED ON: 3 November 2016 DELIVERED AT: Brisbane HEARD ON: Submissions closed 18 August 2016 HEARD AT: Heard on the papers JUDICIAL REGISTRAR: GJ Smith ORDERS: 1. In respect of ML 20243 compensation is determined in the total sum of $500.00. 2. The applicant pay compensation to the respondent the amount set out in order 1 within two months from notification of the renewal of the mining lease by the Department of Natural Resources and Mines. CATCHWORDS: MINING LEASE – renewal – referral – determination of compensation – absence of expert or valuation evidence – use of Court judgments for determination purposes. Mineral Resources Act 1989, s 281(1) Public Trustee Act 1978 Corella Valley Corporation Pty Ltd v Power & Anor [2014] QLC 46 Eacham Abrasive Blasting Pty Ltd v Gundersen & Anor [2014] QLC 38 Fitzgerald v Struber & Anor [2016] QLC 6 Re Fitzgerald & Anor v Struber & Anor [2009] QLC 76 Kelly v Struber & Anor [2016] QLC 7 -- 1 of 6 -- 2 Wallace & Ors v Bottomer & Ors [2015] QLC 23 Wills v Minerva Coal Pty Ltd [No.2] (1998) 19 QLCR 297 APPEARANCES: Not applicable [1] This proceeding concerns a referral to the Land Court by the Chief Executive, Department of Natural Resources and Mines (DNRM) pursuant to s 281(1) of the Mineral Resources Act 1989 (MRA) for the determination of compensation in respect of the renewal of Mining Lease 20243 (ML 20243). Background [2] The applicant, Stephen John Brown (the miner) seeks the renewal of a mining lease located on land described as Lot 4567 on SP 254826. The area relevant to this determination concerns an 8.5 km access track across land owned by the respondent, NBT Pty Ltd ACN 001 945 446 (the landowner). [3] The subject land, known as Bellevue Station is located in the Mareeba Shire Local Government area and is used for grazing purposes. [4] The specific Land Court reference and tenure details are set out as follows: Court Reference Tenure ID Relevant Area Term Purpose MRA217-16 ML 20243 8.5 ha 10 years Access Relevant Legislation [5] Section 279 of the MRA provides that a mining lease shall not be granted or renewed unless an agreement in relation to compensation has been filed or, in the absence of such an agreement, a determination of compensation has been made by the Land Court. In this matter, no agreement has been lodged with DNRM and the matter has been referred to the Land Court for determination. [6] Section 281 of the MRA identifies the matters which must be considered by the Court when determining compensation. In particular, s 281(3)(a) provides that an owner of land is entitled to compensation for: “(i) deprivation of possession of the surface of land of the owner; (ii) diminution of the value of the land of the owner or any improvements thereon; (iii) diminution of the use made or which may be made of the land of the owner or any improvements thereon; (iv) severance of any part of the land from other parts thereof or from other land of the owner; (v) any surface rights of access; (vi) all loss or expense that arises; as a consequence of the grant or renewal of the mining lease.” -- 2 of 6 -- 3 [7] Section 281(4) enables various additional factors to be included in the compensation determination. In the present case, only paragraph (e) is relevant. It provides as follows: “(4) In assessing the amount of compensation payable under subsection (3) - (e) an additional amount shall be determined to reflect the compulsory nature of action taken under this part which amount … shall be not less than 10% of the aggregate amount determined under subsection (3).” [8] The assessment to be undertaken in accordance with s 281 was discussed in Wills v Minerva Coal Pty Ltd [No.2]1 as follows: “It is beyond question as I have written above that the primary source of law is the statute under consideration and it seems to me that the learned Member acknowledged this when he said: ‘The section in my opinion merely identifies matters which shall be taken into consideration in making the assessment. It does not prescribe a method of valuation.’ Section 281 MRA neither prescribes nor suggests a method of assessment or valuation either. The selection of an appropriate method is a matter for the relevant expert, however, there is one warning that I should post. If the expert was to approach the assessment of compensation by simply accumulating figures assessed independently under each of the items listed in s.281(3)(a)(i) to (vi) and without regard to the prospect of a matter being dealt with under more than one item, the chance that there will be a duplication of items assessed will be high.” The Conduct of the Proceedings and Evidence [9] On 16 June 2015, the Land Court registry wrote to the parties setting out a timetable for the delivery of materials and submissions in accordance with Land Court Practice Direction No. 6 of 2015. The Miner’s Contentions [10] On 6 July 2016 a compensation statement was received from the miner and filed in the registry together with a hearing statement and two statutory declarations. These materials included the following points regarding the determination of compensation in respect of access to ML 20243: 1. The land traversed is a poorly formed road without improvements. 2. The access road is used by other miners and presumably the landowner. 3. There is no deprivation of possession. 4. The mining operation is a small scale and 8.5 km is traversed twice per month six or seven months per year. 5. There is no disturbance to the operations of Bellevue Station from access on this road. 1 (1998) 19 QLCR 297 at p 315. -- 3 of 6 -- 4 6. Contends for an assessment of $5 per kilometre in respect of the 8.5 kilometre access track plus an additional 10% pursuant to S 281(4) (e) of the MRA with an offer of $50.00 plus GST per annum is made based of these calculations. The Landowners Contentions [11] A two page statement was received by the Court from the landowner on 13 July 2016. The following matters are contended by the landowner in support of a determination of $200 per annum compensation: 1. Over the last five years a significant cost to the management of the pastoral lease has been illegal entry and stock theft in the order of 500 head. While this in no way reflects on the Miner it has imposed a higher responsibility associated with securing access. To this end we are installing gateways that will be locked on all access roads off the designated roadways to reduce trespass access. Consequently as part of any compensation agreement we would be requiring formal notification of entry to the property. 2. Roads are graded after the wet. The photograph in Mr. Brown’s statement was taken prior to grading and depicts a poorly formed road which is not indicative and is highly misleading. There are improvements on the road and the cost of the roadworks is not inconsiderable and involves utilising a contractor to clear creek crossings and roadways using a grader and loader. The overall cost to the station is $80,000 to $100,000 per annum and whilst 8.5 km of that roadway might be small it remains a significant cost of maintenance. 3. There is no deprivation of possession however there is the cost of supervision of people moving about the station due to security issues. There is disturbance to Bellevue Station as access is now monitored via security cameras and there is a cost of ensuring compliance with legal entry. This has arisen as a result of stock theft and illegal hunting. 4. Compensation be provided which is similar to that already negotiated by contemporaries of the miner and should recognise that the costs of compensation need to reflect compensation in a global sense rather than purely as a tollway and not set at the derisory level of $40/$50 per annum. 5. Impose on the miner an obligation to report on and off via the manager each time entry is required. This is consistent with our OH&S policies on all other matters and there are no reasonable grounds for excluding one party. -- 4 of 6 -- 5 Consideration of Submissions [12] In undertaking this determination I have considered the materials and submissions provided by the parties and referral documents, mapping and plans provided by DNRM. With the agreement of the parties a hearing with full evidence has not been required and the determination is to be undertaken “on the papers”. [13] The miner’s submissions are mostly not in dispute however the landowner in not in agreement with the following issues: 1. the amount of compensation offered by the miner and the manner of assessment; 2. “disturbance” arising from the miner’s access due to the need for security cameras; and 3. the condition of the access track i.e. it is usually in much better condition than depicted in the miner’s photograph. [14] The landowner’s suggestion that “the costs of compensation need to reflect compensation in a global sense” needs to be considered in light of both s 281 of the MRA and the relationship (if any) between those costs and the use of the track by the miner. Although, on the material before the Court the amount of these “global costs” such as road maintenance and additional security precautions have undoubtedly been incurred, it is not clear how or the extent to which the miner’s use of the access track contributes to these costs. Consequently, the apportionment of these “global costs” as part of the Court’s determination of compensation would be entirely speculative. On the material before the Court it is unclear how the miner’s use of the access track contributes to these costs and accordingly I am unable to adopt the compensation contended for by the landowner. [15] The landowner also requests that the Court “impose on Mr Brown the obligation to report on and off via the manager each time entry is required”. Although the landowner’s basis for this requirement i.e. occupational health and safety may be understandable, I am not able to accept that any provision of the MRA enables the Court to make any order other than a monetary amount. This aspect of the Court’s determination process was addressed by Member Isdale in Corella Valley Corporation Pty Ltd v Power & Anor2 as follows: “In order for it to perform its duty of determining compensation as set out in the MRA a sum of money must be set by the Court. There is no provision under the MRA for the Court to deal with any matters other than this.” The Court is therefore unable to impose any obligation of this nature upon the miner. 2 [2014] QLC 46. -- 5 of 6 -- 6 Determination [16] In the absence of any expert evidence or quantification of the impact of the miner’s use of the track in light of s 281 of the MRA I consider that the most appropriate guidance for this determination is from contested Court judgments from within the Mareeba district that have been based on evidence tested by cross examination, full submissions and an inspection of the subject land. [17] The judgment in Fitzgerald & Anor v Struber & Anor3 followed contested proceedings of this type and determined compensation at $10 per ha per annum for mining lease areas and $5 per ha per annum for access areas. These rates have also been applied in more recent Court determinations including those identified by the miner.4 On this basis I consider that $5 per ha per annum is fair and reasonable compensation for the relevant access area in respect of ML 20243. [18] Although the width of access recorded in the referral documents is 3m the access area calculations provided by the miner i.e. 8.5 km x 10m = 8.5 ha are supported by the photographic evidence provided by him and appear to be correct. The access area of 8.5 ha will be rounded to the next full hectare for the calculation purposes. [19] The final determination in respect of ML 20243 is set out as follows: Area covered by access – 9 ha @ $5 per ha = $45.00 per annum add s 281(4)(e) re: compulsory nature of grant = $ 5.00 per annum Total = $50.00 per annum [20] In view of this amount and the duration of the renewal period I intend to order that the total amount of compensation be paid in one lump sum of $500.00 within two months from the notification of the renewal of ML 20243 by the Department of Natural Resources and Mines. Orders 1. In respect of ML 20243 compensation is determined in the total sum of $500.00. 2. The applicant pay compensation to the respondent the amount set out in order 1 within two months from notification of the renewal of the mining lease by the Department of Natural Resources and Mines. GJ SMITH JUDICIAL REGISTRAR 3 [2009] QLC 76. 4 Eacham Abrasive Blasting Pty Ltd v Gundersen & Anor [2014] QLC 38; Fitzgerald v Struber & Anor [2016] QLC 6; Kelly v Struber & Anor [2016] QLC 7; Wallace & Ors v Bottomer & Ors [2015] QLC 23. -- 6 of 6 --