Cunningham v Minister for Lands [1993] QLC 92

LAND COURT, BRISBANE. 23rd July, 1993. Re: Determination of Rent - First Decennial Rental Period Strathmore Pastoral Holding No. 05/4875 Lessee: Edward Cunningham (Hearing at Bowen) DECISION In this case the Crown is seeking an annual rent of $5 ,535, or 13.5 cents per hectare, for the first decennial rental period of the abovementioned Pastoral Holding, which commenced on 1st January, 1990 . The rent for the previous rental period was $2,870, or 7 cents per hectare, per annum. The increase in rent arises from the implementation by the Crown of recommendations by Mr C H Carter, Member of the Land Court, following an Inquiry which he held in 1989. Mr Carter's report contained, among other things, a recommendation for an increase of 200% in cattle rental standards and this resulted in an increase in the rent for the hypothetical best cattle property in the Mackay District from 95 cents per beast per annum to $2.85 per beast per annum. The increased rental standards were challenged in the Land Court and Land Appeal Court. In Determinations of Rent - Pastoral Holding Stawellton No . 23 / 2004 Hu ghenden District and other Grazing Selections, decision delivered 20th March 1992 (not yet reported), the Land Appeal Court confirmed the increased rental standards for cattle country. Strathmore Pastoral Holding No. 05/4875 is described as Lot 3 on Plan [1993] QLC 92 -- 1 of 7 -- 2 SM73 in the Parishes of Castor and Heidleberg and contains an area of 41,000 hectares. It is situated approximately 27 kilometres north-west of the town of Collinsville and access is by means of a mainly formed gravel road. It is situated approximately 135 kilometres south west of Bowen. The Crown report was prepared by Mr T Mullins, registered valuer employed by the Department of Lands, who described the holding as comprising mainly undulating downs and forest with frontage to the Bowen River and Pelican Creek. Several creeks intersect the holding and about 2100 hectares is severed by the Bowen River. Mr Mullins classified the country as follows: about 31,760 hectares (75%) open to moderately timbered black soil plain with narrowleaf ironbark and bloodwood forest patches; about 2,650 (6%) brigalow, yellowwood scrubby patches and about 3,300 hectares (8 .5%) stony ironbark, bloodwood ridges; 3,690 hectares (9%) of unavailable ranges and mountains. The report goes on to state that approximately 1100 hectares of scrub and scrubby patches have been pulled, stick-raked and grassed and about 2170 hectares of forest have been ringbarked. Although 607 hectares of black soil plains have been cultivated for fodder crops, none of the area has been classed as arable. Mr Mullins explained that this was because of the property's distance from a major centre and the unreliability of rainfall. There is permanent natural water in the Bowen River and Station Creek and semi-permanent holes in Rocky Creek and Table Mountain Creek. Artificial water supplies comprise numerous equipped bores and dams. The report recognises that the property suffers from plant and animal pests, -- 2 of 7 -- I, 3 including prickly acacia, creeping mimosa, harrisia cactus, parthenium, noogoora burr, dingoes and pigs. It emerged during the hearing that there is also infestation of rubber vine on the watercourses. The report states that extensive action has been taken and monies expended on control and eradication of prickly acacia and harrisia cactus. Mr Mullins estimated the present carrying capacity at 1 beast to 10 hectares, or 4100 head, with a potential of 1 beast to 8 hectares, or 5,125 head, which could be achieved by destroying the creeping mimosa and prickly acacia. The lessee, Mr Edward Cunningham, gave evidence and tendered a number of documents on matters relating to the rent of the subject property. I do not propose to discuss this evidence in detail, referring only to those issues which I think are relevant to the method of assessment used by the Crown, which was endorsed in the Stawellton case by the Land Appeal Court. Mr Cunningham described how the property has over the last 20 years become heavily infested with prickly acacia and with creeping mimosa. The former grows to an adult tree of about 8 metres in height, while the creeping mimosa is about 2 metres in height. These pests have spread over the black soil areas of the property to such an extent that they have affected the carrying capacity. Mr Cunningham presented details of the increasing annual cost of treating the prickly acacia (acacia nilotica), which since 1980 has amounted to over $435,000. In 1992, over $120,000 was spent on control measures. These control measures are now proving effective, but Mr Cunningham sees the need for further -- 3 of 7 -- l. 4 expenditure for at least 3 or 4 more years. He said that he is concentrating on the prickly acacia and when it is under control he will start on the creeping mimosa. In addition to those pests, Mr Cunningham said that Strathmore has parthenium and rubber vine infestations on the rivers and watercourses. They have also affected the carrying capacity . Mr Cunningham tendered details of the water improvements on the property and it is obvious that despite the natural water which is available, there has been a large expenditure on artificial water supplies. The map he provided showing the water points would tend to support his claim that Strathmore is one of the best improved properties in the area. At present the drought is severely affecting the district, like so many others in Queensland, and Mr Cunningham said that there is no feed left in the area. He explained that about 3 years ago he had to de-stock Strathmore as part of the TB eradication scheme and now runs few cattle of his own. Instead he has sub-leased most of the property under 7 sub-leases the terms of which run from 1990 to 1995. The sub-lessees pay him rent but he is responsible for all outgoings. Mr Cunningham agreed generally with the contents of Mr Mullins' report, except for the area of unavailable country. He said that it had previously been recognised that the unavailable area on Strathmore amounted to 25 square miles (6,475 hectares). Mr Mullins' estimate of 3,600 hectares (14 square miles) did not include all the areas of unavailable country, in Mr Cunningham's opinion, and he marked on the map other areas which he said were unavailable. -- 4 of 7 -- ' ' 5 Mr Mullins gave evidence that he had not inspected the property as thoroughly as he would have liked because of the circumstances involved in having the Carter rental standards resolved expeditiously. However, he had made a partial inspection bf the property and had seen the acacia and mimosa problems. He also had access to former reports and other records. Mr Mullins explained that he had calculated the area of unavailable country by measuring from aerial photographs and referring to other records and information available to the Department. He conceded that there may be cause to adjust his estimate to a small extent as a result of Mr Cunningham's evidence, but said that this would have no effect on the carrying capacity, which he and Mr Cunningham had agreed was 1 beast to 10 hectares. Apart from the difference in the area of the unavailable country, there is no disagreement between Mr Mullins and Mr Cunningham about the description of country and the problems affecting Strathmore. Mr Mullins is well aware of the cost and effort expended in endeavouring to eradicate and control the various pests. On the evidence before me, I am not able to resolve the issue of the area of unavailable country. Mr Cunningham feels that it should continue to be recognised as 25 square miles (6,475 hectares), while Mr Mullins has measured it at 14 square miles (3,600 hectares). However, Mr Mullins concedes that he has not fully inspected Strathmore and this area may need some adjustment. In the event it is not necessary to resolve this matter on this occasion. The method of rental assessment depends on carrying capacity and various factor allowances and not on description of country. I will therefore leave the issue of unavailable country -- 5 of 7 -- 6 open and not make a finding in this regard. The method used by Mr Mullins was that endorsed by the Land Appeal Court in the Stawellton case. Mr Mullins explained how he adopted a prime net rate of 195.6 cents per hectare for the subject property with its carrying capacity of 1 beast to 10 hectares, situated where it is . This is derived in relation to the rental standard determined for the hypothetical best property in the former Mackay Land Agents District of 285 cents per hectare. From this prime net rate Mr Mullins deducted allowances totalling 31% for the various factors affecting the holding, including 10% for the severe pest problems from which it suffers. Mr Mullins explained that this is much higher than has otherwise been allowed for such pests and is in recognition of the severity of the problem on Strathmore. By deducting the allowances from the prime net rate, Mr Mullins arrives at a net rate of $1.35 per beast, or 13.5 cents per hectare. In my opinion Mr Mullins has properly approached his task in assessing the rent for this holding. He has used the method approved by the Land Appeal Court and has made appropriate allowances for each of the factors involved. The unresolved issue of unavailable area does not affect the outcome. I have therefore concluded that the rent asked by the Crown for this holding is appropriate. The increase is well below the general rental standard increase and it is quite modest when compared with the annual rental which Mr Cunningham receives from his sub-leasees, albeit for the improved property. -- 6 of 7 -- \ . 7 Accordingly, the rent for the first decennial rental period of the lease of Strathmore Pastoral Holding is determined at $5,535 (13.5 cents per hectare) per annum. J J TRICKETT. MEMBER OF THE LAND COURT. -- 7 of 7 --