Adam Kuzio v Stephen Struber and Dianne Wilson-Struber
[2012] QLC 54
•28 September 2012
LAND COURT OF QUEENSLAND
CITATION: Adam Kuzio v Stephen Struber and Dianne Wilson-Struber [2012] QLC 0054 PARTIES: Adam Kuzio
(Applicant)v. Stephen Struber and Dianne Wilson-Struber
(Respondents)
FILE NO: MRA931-10 DIVISION: Land Court of Queensland PROCEEDINGS: Application for determination of compensation DELIVERED ON: 28 September 2012 DELIVERED AT: Brisbane HEARD AT: Cairns MEMBER:
His Honour, Mr WL Cochrane
ORDERS: 1. I determine compensation under s.281 of the MRA as being $17.50 per year.
2. The miners pay total compensation of $17.50 per year to the current landowner within two months of notification of grant of the mining lease by the Mining Registrar and thereafter such compensation to be paid annually in advance.
CATCHWORDS: Mining – Mining Lease – Determination of Compensation – Mineral Resources Act 1989 s.281 – Re Wallace & Ors & Evans [2006] QLRT 93 applied.
Dembowski & Anor & Struber & Anor, Re [2006] QLRT 44 (26 May 2006)
Re Wallace & Ors & Evans [2006] QLRT 93.
APPEARANCES: Applicant in person.
Mr S Struber for the Respondents.
Background
Adam Kuzio (the miner) made application for a Mining Claim (MC 20088) on or about 12 May 2009. That application affected a number of leasehold grazing properties including Palmerville Station owned by the respondents and described as Lot 2 on CP910619 Palmerville Holdings.
The application by Jacek Andrew Zaborszczyk is adjacent to the application made by Adam Kuzio and because of the role assumed by Kuzio in prosecuting his own claim and also in representing Zaborszczyk in his claim the two matters have become intermingled as each utilises the same access.
Accordingly, the two matters were heard and determined together with Mr Kuzio speaking on behalf both of himself and of Mr Zaborszczyk.
Notwithstanding that the matters were heard together each application will be dealt with in a separate decision.
This determination of compensation relates to both access to the mining lease and the mining lease itself.
At a later time early in 2010 another application was made by Mr Jacek Andrew Zaborszczyk for Mining Claim 20089. The Zaborszczyk and Kuzio claims are adjacent to each other and utilise an identical access way. Accordingly, the matters were dealt with together in Cairns.
The Kuzio claim is for .991 Ha compared to .84 Ha in respect of the Zaborszczyk claim.
For the purposes of determining compensation I have regarded each claim as being of approximately 1 Ha in area.
The Mining Claim includes land which is within Sandy Creek.
Court Practice Direction
On 27 January 2010 the Court sent letters to the miner and the landholders bringing the referral of this matter to the Court by the Mining Registrar to their attention and advising them of their obligations pursuant to the Land Court Practice Direction. Timeframes for the submission of relevant material were identified to each of the parties.
On 7 May 2010 the miner wrote to the Land Court asserting that
“I wrote letters to each of the Landholders, explaining that road will be used by 4WD vehicles and only a few times a year, as described in Mining Program. I proposed to pay $10 per year which is in line with Land Court determinations for mining leases using the same road. I regarded it as generous, because I do not use and haul any heavy equipment, diesel etc (like other miners do), and actually use road only for very limited time (6-8 weeks) every year (that maximum five passes per year).[1]
[1] Correspondence to Land Court from Kuzio 7 May 2010 (received 17 May 2010).
That correspondence referred to in the preceding paragraph also advised the Court that the miner had not received any reply to his correspondence from the owners of Palmerville Station.
At a later time the Struber’s wrote to the Land Court asserting that the application for a Mining Claim had not been properly made.
It should be noted that this is a determination of compensation and not a determination of the correctness of an application for a Mining Claim.
If there are defects in the application for a Mining Claim then the landowners are entitled to bring an application before this Court and seek the appropriate relief including declarations. To date they have not done so.
A mediation in the matter was set down for 9 March 2011 but because of road conditions in the area that mediation was not able to proceed. It was adjourned to a date to be fixed.
Ultimately a mediation was conducted by telephone link up failed to produce agreement between the parties and the matter was then listed for hearing.
The miner sent an email to the Court on Wednesday 4 May 2011 stating:
“On May 3 2011 we have received letters from Palmerville owners, with proposition of compensation.
For claim 20089 it amounts to $1,735.95 for the first year (One Thousand Seven Hundred and Thirty-Five Dollars) for claim 20088 it amounts to $13,859.95 for first year; (Thirteen Thousand Eight Hundred and Fifty-Nine Dollars) those figures are of course not acceptable to us and we have lost all hope of any negotiated settlement. So now we would like to ask the Court for determination of compensation on papers as stated in our previous letter.”
That correspondence exhibited two compensation contracts both signed by the landowners reflecting the information provided by the miner.
The Struber’s calculate the compensation in the following way:
Time spent inspecting APPP M.C 20088 $260.00 First Year Only Vehicle costs $108.00 First Year Only Checking information and preparing paperwork (including phone calls, faxes, postage) $213.45 First Year Only Deprivation of Possession of Land ($1.30 Per Day) $474.50 The Mining Registrar calculated the access road to be 13.6 kilometres long at $50.00/KLM/Year $680.00 Loss production $12,124.00 First Year Total Payment $13,859.95 2nd Year Total $13,278.50
In an earlier letter from the miner dated 15 April 2011 he set out what they contend to be an offer for compensation.
Because of the way this matter has unfolded it seems appropriate to set out in its entirety the articulation of his proposal by the miner.
The miner expressed his offer this way:
“We would like you (Land Court) to offer $50 per annum/per claim as compensation for mining and access to Mr Struber.
This is $17.50 higher, than calculated according to determinations of Land Court in Palmerville area.
We have a letter, dated 17 May 2010, from Peter Wilson, explaining how to work out compensation amount. Above figure was made up using
the formula forwarded to us by Mining Registrar.
Length of access road is less than 14 kilometres, but we rounded it up to 15 km. Compensation rate per hectare is $5, width of this track is 3 metres,
So 15 000 metres multiply by 3 = 45 0000, divided by 10 000 = 4.5 hectares x $5 = $22.50
Mining is $10/hectare, claim is less, so rounded up = $10.00
Total $32.50/per claim
I have enclosed photo of access road. As seen – it is one-line track, no more than 3 metres wide.
Mining will be done within river bed, and it have to be said, that whole area was mined in the past, and only small part of it covered by stunted grass, so farmer will
not incur any measurable losses.
We believe that this offer is generous enough.
But – if Mr Struber will try to stall, by asking for more, we are prepared to offer extra $25 [total of $75/per claim].
After last Court session, we have sent letters to Mr Struber, hoping, that he will state his price. But we did not get any reply.
We are trying to get agreement with Mr Struber for over two years.
For this reason, we beg the Court to make determination “on papers”, if our offer is not accepted.”
At a directions hearing conducted by the Judicial Registrar Mr O’Connor on 11 May 2011 the parties were advised that in the circumstances of the case the Court would not determine compensation “on the papers” and a hearing would be required.
The matter was set down for hearing at Cairns in the week of 29 August 2011 and on 15 June I made orders requiring the miner and the landholder to file material relevant to the determination in the Court on a variety of dates prior to 27 July 2011.
In accordance with that order Mr Kuzio the miner filed an enlarged copy of a plan of the access and the location of the Mining Claim area together with a copy of a decision of the then Mining Registrar Mr Windridge in a case called Dembowski & Anor & Struber & Anor, Re [2006] QLRT 44 (26 May 2006).
The miner also filed a document relating to both the present claim and claim 20089 to be operated by Mr Zaborszczyk.
That letter repeated the miner’s assertion that compensation ought be determined in the range $5 to $10 per Ha per year. In support of that offer they also provided to the Court two colour photos of what seems to be the access track into the mine area.
It appears that the correspondence sent to the Land Court was not so promptly sent to the Struber’s because on 16 July 2011 they wrote to the Land Court complaining that they had not received the material by 6 July but in fact received it on 13 July and thereby asserted that they could not respond by the due date for material from them pursuant to the order made by me on 15 June 2011 requiring the Struber’s to file their material by 20 July. In the event by the time the matter came on for hearing in Cairns on 2 September 2011 the Struber’s had still not filed any material.
At the hearing in Cairns the Mining Registrar for the Mareeba Mining District Mr Peter Wilson appeared in Court as Amicus Curiae.
At the hearing in Cairns Mr Adam Kuzio the claimant in file MRA931-10 in respect of Mining Claim 20088 appeared on his own behalf.
The two Mining Claims are contiguous and accordingly it seemed expeditious to deal with the matters in tandem as it were.
In the hearing before me much of the debate centred on the access road and the manner of the submerged dredging operation proposed by the miner. It appears that the proposed equipment is a submersible dredging device which needs a sufficient depth of water to be able to operate.
Mr Kuzio was emphatic that neither he nor the miner in the present case proposed to utilise the submerged dredging device across the track or crossing on the river presently used by Mr and Mrs Struber.
The effect of the evidence referred to above was to reveal that, in truth, a significant part of the Struber’s concerns related to utilisation of the access way (which it seems clear is used not only by the applicant in this matter and by Mr Struber but by other miners with leases on the Struber land).
Mr Struber expressed the not unreasonable concern that if mining were to occur within 5 metres of the access way then during wet seasons the track itself could more easily wash out.
Mr Struber acknowledged that at the present time the access does from time to time wash out in places any way.[2]
[2] T.1-53 L.40.
In front of me in Cairns Mr Kuzio told the Court that he would be perfectly happy for a condition in the mining lease to say that they would not mine within 5 metres of either side of the existing crossing.
The other matter which was of concern to Mr Struber was the actual location of the track and Mr Struber’s concern that the holders of a mining lease may stray from the access way nominated by them and use other areas of his land. Obviously a miner is restricted to utilising access in the areas designated on their lease and if the access is changed then that may require any amendment of the lease area.
I am disinclined to proceed on the basis that a miner would use land other than the land the subject of a properly granted lease.
While Mr Kuzio has told the Court he was willing to succumb to a condition restricting mining to not being within five metres of the access way, I do not see that such a condition is a relevant condition to impose upon a determination of compensation.
The record however will show not only that the condition was agreed to by Mr Kuzio but also acknowledged by Mr Struber as going a long way, if not the whole way, to satisfying his concerns. Accordingly, if and when the time comes to grant a mining lease as sought by Mr Kuzio, the granting authority should take into account both the willingness and desirability of incorporating a condition restricting mining to the five metres either side of the access way.
As to compensation, I have set out above the basis upon which Mr Struber contends compensation ought be calculated and also set out the offer made by the applicant to pay compensation.
Neither party adduced any evidence to justify the composition of their contentions with respect to compensation.
The area applied for is less than 1 Ha in a locality where my experience in other cases leads me to a view that the carrying capacity of properties like Palmerville Station is in the order of 1 beast per 15 Ha.
Even allowing for twice that stock in density it seems to be wildly speculative to assert, as Mr Struber does, that he will suffer a loss of production of the order of $12,124.00 per year for the loss of less than 1 Ha of land.
Each parties attention has been drawn to a decision of Mr Windridge as the Mining Registrar in Dembowski & Anor & Struber & Anor, Re [2006] QLRT 44 (26 May 2006). In that decision involving the same landholders the presiding Member ultimately determined[3]:
“Determination
[21]There will be a negligible effect, if any at all, on the management of the pastoral holding. Principally, only the alluvial material in the stream bed will be disturbed. This disturbance will be minimised and returned to natural contours as soon as the stream suffers flooding. I am not satisfied that any award other than a nominal award is justified. The stream bed is the property of the State. Any banks or land which are included within the lease boundaries are not part of the plan of operations and will not be disturbed. While the rate per hectare may appear to be low, I take into account that only the stream alluvium is to be mined and processed. Should the lease be terminated before expiration of the full term, the landowner has the financial benefit of some overpayment. Having regard to the foregoing, I determine compensation as follows at the rate of $10.00 per year for a renewed term of 10 years.”
[3] Dembowski & Anor & Struber & Anor, Re [2006] QLRT 44 (26 May 2006) page 4 para [21].
At the end of the day the Court is left really only with the contentions which have been extracted from material set out above provided by each of Mr Kuzio and the Struber’s.
The Court has commented on a number of occasions previously about the difficulty of determining compensation in circumstances where scant or no evidence is provided to the Court.
For example, Judicial Registrar O’Connor has observed[4]:
“It is not an uncommon occurrence for either of both parties in a compensation matter before the Court to fail to comply with the Practice Direction. The absence of detailed compensation evidence from both sides clearly makes the task of the Court in determining compensation difficult. In the circumstances, I adopt the analysis of the legislative provisions, compensation principles and methodology applied by Mining Referee Windridge in Re Wallace & Ors & Evans [2006] QLRT 93.”
[4] Re Wilkins and Mudge [2009] QLC 0075 (29 May 2009), page 2 para [5].
In Wallace & Ors & Evans, Mining Referee Windridge observed:
“The evidence
…
[8]There was no formal valuation evidence to consider therefore the Court does not have that assistance in arriving at a determination. Due to the small area involved, the cost of a valuation would far outweigh any award for compensation. Due to the small area involved, co-use or co-occupation would not be feasible, and the land owner has notionally lost the use of the lease area of approximately 8ha for the term of the renewal. However, as the intention is to extract tin, gold and gravel from the creek alluvium, the mining operation will have little or no effect on the grazing operation.
[9]Prior determinations and agreements for leases and claims in the Mareeba area for alluvial gold or tin operations range from about $1.00 per hectare per year to $3.00 per hectare per year.
[10]In summary, there was no evidence called to support any claim under any other head of compensation, nor was any matter raised which would necessitate consideration under paragraphs (a), (c), (d), or (e) of subsection 4 of section 281 of the Act.
Access
[11]From details provided in the copy of the application for renewal, it appears access is partly through the same property. There are no details of this access or the effect it will have on the operations of the landowners. Access is in all probability a track that is used by any number of persons who have leases, claims or prospecting tenures in the area. I award a nominal sum of $10.00 in relation access to the lease, noting that the term of the renewal is not of a short duration.
Blot on title
[12]The loss of land through a mining tenure of lengthy duration has been accepted by the Land Court as similar to permanent acquisition for a limited time (Smith v Cameron (1986-87) 11 QLCR). In this instance, the renewed lease is over an area of 8 hectares, and the term of the renewed lease is 21 years. In the absence of any evidence, I make no allowance for any perceived blot on title. I note that a mining lease grants the right to mine on a limited area for a limited time. Other than the right to mine, the grant of a lease does not create any interest or title in the land. There is no endorsement or registration of the lease on the background title document.”
In his decision, Mining Referee Windridge, took into account, as seems appropriate in the present case, that the only viable use of the land is low intensity grazing if pasture is available in the alluvial beds.
He concluded that mining operations on the lease would have no measurable effect on the operations conducted on the property and, while there would be some minor effect which would the noise of machinery and the movement of people and vehicles on or about the lease area and along the access road, there was no evidence of severance of one part of the property from any other part.
Those observations are entirely apposite in the present case. The Mining Referee also found that the lease was taken out for alluvial mining and was a low impact operation. Again, those observations apply to the present case.
In Wallace & Ors the Referee allowed $1.00 per annum per hectare for the term of the renewal on the notional area of 8 Ha and awarded an additional sum of $10.00 for access.
In the present case, it was acknowledged by both parties that “typical figures” allowed for compensation in other cases range between $5 and $10 per hectare.
The area sought by way of mining leases is .991 Ha for Mining Claim MC 20088.
In Court before me Mr Kuzio informed the Court that the access across the Struber’s property was nearly 15 km in length. Mr Struber did not seek to contradict that figure. Accordingly, a 15 km access 10 m wide involves 1.5 Ha of land being taken up for access but, as indicated above, that access is utilised by the landowner and also by other miners.
In all of the circumstances I think it reasonable, particularly having regard to the correspondence from Mr Kuzio to allow $7.50 for the access way and to allow for the loss of 1 hectare of land calculated at $10 per hectare (rounding up .991).
So that the total compensation I determine is $17.50 per year.
Mr Struber will no doubt raise the issue that in that correspondence[5] Mr Kuzio had contemplated an offer of $50 per annum per claim but my comprehension of that offer was that it was an attempt to resolve the matter without the need to bring it before the Court. That did not happen. By his conduct, in my view, Mr Struber is disentitled to ask the Court to award that figure.
[5] Exhibit 7, 15 April 2011.
The figures contended for by Mr Struber which led to his calculation of $13,859.95 in the first year and $13,278.00 in the second year are, in my view, wildly exaggerated and unsustainable. Indeed, despite being given the opportunity by appearing in front of the Court Mr Struber made no effort to explain how those figures were calculated particularly in respect of the loss of production which was claimed at a rate of $12,124.00 per year.
Accordingly, I determine compensation under s.281 of the MRA as being $17.50 per year and further direct that the miner pay the annual compensation and the sum of $17.50 per year to the current landowner within two months of notification of grant of the mining lease by the Mining Registrar and thereafter such compensation to be paid annually in advance.
HIS HONOUR, WL COCHRANE
MEMBER OF THE LAND COURT
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