Eacham Abrasive Blasting Pty Ltd v Gundersen & Anor

[2014] QLC 38

LAND COURT OF QUEENSLAND

CITATION:

Eacham Abrasive Blasting Pty Ltd v Gundersen & Anor [2014] QLC 38

PARTIES:

Eacham Abrasive Blasting Pty Ltd
(applicant)

v

Grant Henrik Gundersen and Laurelle Ursula Loran Gundersen
(respondents)

FILE NO:

MRA031-13

DIVISION:

General Division

PROCEEDING:

Determination of compensation payable for renewal of mining lease

DELIVERED ON:

28 October 2014

DELIVERED AT:

Brisbane

HEARD ON:

Submissions closed 19 September 2014

HEARD AT:

Heard on the Papers

MEMBER:

PA Smith

ORDER:

1.    Compensation is determined in the total sum of Eighty-two Dollars and Fifty Cents ($82.50).

2.    Eacham Abrasive Blasting Pty Ltd pay the total compensation of $82.50 to Grant Henrik Gundersen and Laurelle Ursula Loran Gundersen within two months of the renewal of ML 20079.

CATCHWORDS:

MINING LEASE – determination of compensation – factors to be considered – lack of material from parties

Mineral Resources Act 1989

Fitzgerald v Struber [2009] QLC 76
Horn v Sunderland Corporation [1941] 2 KB 26
McGrath v Callaghan & Ors [2011] QLC 29
Mitchell v Oakhill and Mitchell (10 March 1998) unreported
Richardson v Barrett [2001] QLRT 89
Shaw v Heritage Holdings Pty Ltd (1992-93) 14 QLCR 139
Smith v Cameron (1986) 11 QLCR 64
Unimin Australia Limited v Maurice and Tricia Freeman (2007) QLC 76

APPEARANCES:

Not applicable

Background

1. The applicant Eacham Abrasive Blasting Pty Ltd (the miner) currently holds Mining Lease (ML) 20079. A previous holder applied for a renewal of ML 20079 on 7 June 2012 for a period of five years.

2. The ML is located on land which is owned by Grant Henrik Gundersen and Laurelle Ursula Lorna Gundersen (the landholders). There is also access to the ML across the landholders’ land.

3. From mapping material provided by the Mining Registrar, Mareeba, the access through the landholders’ property is about 1 km long. ML 20079 has an area of 1 ha.

Principles of compensation

1. Section 279 of the Mineral Resources Act 1989 (MRA) provides that a mining lease shall not be granted or renewed unless an agreement in relation to compensation has been filed at the office of the Mining Registrar, or in the absence of such an agreement, a determination of compensation has been made by the Court. In this matter, no agreements have been lodged with the Mining Registrar and the matter has been referred to the Court for determination.

2. The issues which must be considered by the Court are set forth in s 281(3) and (4) of the MRA.

3. Although s 281 sets out the matters to be considered, it does not define any method of assessment. In Smith v Cameron,[1] the Land Court held:

   “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. No doubt each case will depend on its own facts and circumstances but it seems to me that either method is open to the valuer.”

   [1](1986) 11 QLCR 64 at p 74 and 75.

4. In Shaw v Heritage Holdings Pty Ltd,[2] the Land Court said:

   “The method of assessment remains a matter which will be governed by the facts and circumstances of each case in which event emphasis may shift from one method to another.”

[2](1992-93) 14 QLCR 139 at p 146.

1. In considering Mitchell v Oakhill and Mitchell,[3] the then President of the Land Court, referring to s 281(3) of the MRA, found:

   “the latter section does not prescribe a method of assessment. In my view, as long as the amount of compensation finally determined sufficiently accounts for each of the matters referred to in the sub-section, it is not necessary to quantify an amount in respect of each of the matters referred to.”

   [3](10 March 1998) unreported.

2. In determining compensation under s 281 of the MRA, I have adopted the same approach I took in Richardson v Barrett.[4] This means that the matters set out in the section are concepts to be taken into account in determining compensation, not a notion of separate heads of compensation requiring separate and discreet treatment to arrive at an accumulated figure.

   [4][2001] QLRT 89 at paragraphs 9, 10 and 14.

3. The overriding principle is of equivalence, ensuring that, so far as money can do it, the landholders are placed in the same position as if the mining leases were not granted.[5] Of course, great care must also be taken to ensure that there is no “doubling up” of compensation.

   [5]Horn v Sunderland Corporation [1941] 2 KB 26 at 43 per Jacobs J.

The Evidence

1. Following the procedures set out in Practice Direction 1 of 2011, the Court wrote to the parties setting out a timetable for the delivery of material and submissions.

2. No material has been supplied to the Court in response to the Court’s request. No valuation evidence has been provided by either party.

3. As I said in McGrath v Callaghan & Ors,[6] it is always difficult for the Court when the parties to mining compensation matters either choose to place no submissions before the Court, or only very limited submissions. Fortunately, with respect to the North Queensland area, the Court is able to obtain assistance from a number of determinations of compensation under the MRA. In particular, I rely on the Fitzgerald decision of the Land Court which followed a formal hearing in Cooktown, with both the miner in that matter and landholder providing sworn evidence to the Court.[7]

   [6][2011] QLC 29.

   [7]See Fitzgerald v Struber [2009] QLC 0076.

4. As Member Jones said in the case of Unimin Australia Limited v Maurice and Tricia Freeman:[8]

   “I realise that my determination of compensation in this case is a result of little more than calculated guesswork or speculation.  However, in circumstances where the parties have elected to provide little or no material to the Court concerning their position about compensation there is not much more than the Court can do.”

[8](2007) QLC 76.

Determination

1. Having considered the limited evidence in this matter, and taking into account my decision in Fitzgerald where I allowed the sum of $10 per hectare per year for the area of land covered by the mining lease and $5 per hectare per year for access, it is appropriate that I make a like award for ML 20079 in this matter.

2. Assuming that the access is 1 km long and 10 metres wide, that amounts to a total area of 10,000 m² which equates to 1 ha. This amounts to $5 per year for access, which is clearly only a nominal amount. Allowing $10 per hectare per year for the mining land amounts to $10 per year.

3. Adding together both sums leads to a total amount per year of $15.

4. Taking into account the five year renewal term of ML 20079, this amounts to compensation of $75, to which I award the additional sum of $7.50 under s 281(4)(e) of the MRA to reflect the compulsory nature of the grant of the mining lease. This results in total compensation under all heads in the sum of $82.50.

5. Due to the small amount of compensation involved, I order that the miner pay the total compensation of $82.50 to the landowner within a period of two months of the renewal of ML 20079.

Orders

1.     Compensation is determined in the total sum of Eighty-two Dollars and Fifty Cents ($82.50).

2.     Eacham Abrasive Blasting Pty Ltd pay the total compensation of $82.50 to Grant Henrik Gundersen and Laurelle Ursula Loran Gundersen within two months of the renewal of ML 20079.

PA SMITH

MEMBER OF THE LAND COURT