ERO Georgetown Gold Operations Pty Ltd v Henry - [2015] QLC 22

LAND COURT OF QUEENSLAND

CITATION: ERO Georgetown Gold Operations Pty Ltd v Henry [2015] QLC 22

PARTIES: ERO Georgetown Gold Operations Pty Ltd
(applicant)

v

Thomas Peter Henry
(respondent)

FILE NO: MRA015-14

DIVISION: General Division

PROCEEDING: Determination of compensation payable for renewal of mining lease

DELIVERED ON: 28 July 2015

DELIVERED AT: Brisbane

HEARD ON: 17 July 2014

HEARD AT: Georgetown

MEMBER: PA Smith

ORDER:
1. Compensation is determined for the renewal of ML 30122 in the total sum of One Thousand, Four Hundred and Ninety-six Dollars ($1,496).

2. ERO Georgetown Gold Operations Pty Ltd is ordered to pay the total compensation of $1,496 to Thomas Peter Henry by way of four equal instalments of $374 each, with the first instalment of $374 to be paid within one month of the renewal of ML 30122, and the remaining three instalments of $374 to be paid on the fifth, tenth and fifteenth anniversaries of the renewal of ML 30122 respectively.

CATCHWORDS:
MINING LEASE – determination of compensation – factors to be considered
EVIDENCE – expert valuation evidence – rationale not given for expert opinion

COMPENSATION – grazing property also used for tourism and fossicking – impact on tourism to be taken into account

Land Court Act 2000
Mineral Resources Act 1989
State Development and Public Works Organisation and Other Legislation Amendment Act 2015

BHP Billiton Mitsui Coal Pty Ltd v Isdale & Ors [2015] QSC 107
Gregcarbil Pty Ltd v Backus & Ors (No. 4) (2013) QLCR 458
Horn v Sunderland Corporation [1941] 2 KB 26
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

APPEARANCES: Mrs AJ Smith agent for the applicant
Mr EJ Morzone of Counsel for the respondent

SOLICITORS: Emanate Legal for the respondent

Background

The applicant ERO Georgetown Gold Operations Pty Ltd (ERO) currently holds Mining Lease (ML) 30122. The miner applied for a renewal of ML 30122 on 13 November 2013 for a period of 20 years.
ML 30122 is located on Flat Creek Station which is owned by Thomas Peter Henry (Henry). There is also access to the ML from the boundary of Flat Creek Station.
The access through Henry’s property is about 1 km long and 5 m wide. ML 30122 has an area of 3.252 ha.

Principles of compensation

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 agreement has been lodged with the Mining Registrar and the matter has been referred to the Court for determination.
The issues which must be considered by the Court are set forth in s 281(3) and (4) of the MRA.
Although s 281…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2015] QLC 22
Decision Date: 28 July 2015

CaseChat Overview and Summary

In the case of ERO Georgetown Gold Operations Pty Ltd v Henry, the dispute centred around the determination of compensation for the renewal of a mining lease (ML 30122) on property owned by Mr Henry. The property, which is also used for tourism and fossicking, was affected by the mining activities. The primary legal issues that the court had to decide involved the appropriate method for determining compensation under the Mining Act, the weight to be given to expert valuation evidence, and the impact of tourism on the property's value. The court was also required to assess whether the compensation figure proposed by the mining company's expert, Mr Harrison, was adequately supported by a detailed rationale.

The court critically evaluated Mr Harrison's valuation report, noting that it lacked a detailed explanation for the proposed compensation of $10,000. During cross-examination, Mr Harrison admitted that his report contained misinterpretations of the compensation provisions under the Mining Act. Despite the overall similarity in valuations between Mr Harrison and the other expert, Mr Dickenson, the court found Mr Harrison's approach to be insufficiently justified. The court preferred Mr Dickenson's valuation, which took into account the property's use for tourism and the impact on its value. The court concluded that the compensation should reflect the multifaceted use of the property, including its tourism potential.

Based on the evidence and the reasoning provided, the court determined the compensation to be $1,496. This amount was deemed appropriate considering the property's use and the impact of the mining lease renewal. The court ordered the mining company to pay this compensation in four equal instalments over a period of fifteen years. This decision underscores the need for expert valuation evidence to be both comprehensive and correctly aligned with statutory provisions when determining compensation in such contexts.

Orders

Orders of the court

1. Compensation is determined for the renewal of ML 30122 in the total sum of One Thousand, Four Hundred and Ninety-six Dollars ($1,496).

2. ERO Georgetown Gold Operations Pty Ltd is ordered to pay the total compensation of $1,496 to Thomas Peter Henry by way of four equal instalments of $374 each, with the first instalment of $374 to be paid within one month of the renewal of ML 30122, and the remaining three instalments of $374 to be paid on the fifth, tenth and fifteenth anniversaries of the renewal of ML 30122 respectively.

Background

Background to the litigation

Mr Harrison’s valuation report certainly looks more like a “normal” valuation report provided to the Land Court in a proceeding rather than the letter from Mr Dickenson. However, looks can be deceiving. It is true to say that Mr Harrison’s valuation report contains valuable annexures.[11] However, Mr Harrison’s report justifying his valuation of $10,000 is scant indeed. Relevantly, the report provides as follows:[12][11]Ex 2 pages 6-10.[12]Ex 2 pages 4 and 5.“Compensation BackgroundML 30122 covers an area of 3.252 hectares in the north east section of the property adjacent to Lorne Vale and Glen Rowan boundaries as shown on the attached plans.The renewal of the Mining Lease will affect the property as follows:· Access through Flat Creek Station for a distance for about 1 kilometre· Mining activity adjacent to cattle producing lands· Loss of quiet enjoyment· Blot on title During examination-in-chief, Mr Morzone for Henry attempted to have Mr Harrison annunciate additional reasoning in support of his valuation of $10,000. I will let the transcript speak for itself:[13] “Okay. So for all those factors, you’ve just made assessment of a nominal amount of compensation. Was there any precise calculations that you’ve undertaken to come up with that figure, or it is a judgment on you- - -?---It’s a judgment based on experience. I’ve acted for resuming authorities for private landholders for mining companies, and when there’s a small impact on a property, I’ve offered landholders and either party – have acted for both sides – we’ve been able to strike a deal based on a nominal compensation amount, and that varies – this one is a smaller one, so I’m at the lower end of the range, and I think a figure of $10,000 is a reasonable amount to be assessed as nominal compensation.”[13]T1-15 lines 27-35. I must be critical of Mr Harrison’s report where he refers to the definition of compensation payable[14] and then goes on to set out s 281 of the MRA. Although what Mr Harrison sets out is not in quotation marks, it gives the clear impression that he is providing a formal quotation of the compensation provisions under the MRA. When he was challenged on this point by Mrs Smith during cross-examination, Mr Harrison agreed that what he had set out was his interpretation of the compensation provisions of the MRA but he agreed that it was not part of the Act.[15] Although Mrs Smith’s cross-examination related to the latter part of Mr Harrison’s version of s 281 of the MRA, a close reading of the actual s 281 of the MRA shows other parts in Mr Harrison’s interpretation which simply do not exist in the actual legislation. [14]Ex 2 page 3.[15]T1-19 lines 27-30. I find the manner in which Mr Harrison has referred to s 281 of the MRA in his report to be quite misleading. When an objective assessment is made of the valuation and other evidence in this matter, it is apparent that, apart from one point, there is not a great deal of difference between the valuers. When a valuation of the property as a whole is looked at, Mr Harrison arrives at a figure of $100 per ha, whilst Mr Dickenson places the per ha figure at between $70 and $90.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

CITATION:	ERO Georgetown Gold Operations Pty Ltd v Henry [2015] QLC 22
PARTIES:	ERO Georgetown Gold Operations Pty Ltd (applicant)
v
Thomas Peter Henry (respondent)
FILE NO:	MRA015-14
DIVISION:	General Division
PROCEEDING:	Determination of compensation payable for renewal of mining lease
DELIVERED ON:	28 July 2015
DELIVERED AT:	Brisbane
HEARD ON:	17 July 2014
HEARD AT:	Georgetown
MEMBER:	PA Smith
ORDER:	1. Compensation is determined for the renewal of ML 30122 in the total sum of One Thousand, Four Hundred and Ninety-six Dollars ($1,496). 2. ERO Georgetown Gold Operations Pty Ltd is ordered to pay the total compensation of $1,496 to Thomas Peter Henry by way of four equal instalments of $374 each, with the first instalment of $374 to be paid within one month of the renewal of ML 30122, and the remaining three instalments of $374 to be paid on the fifth, tenth and fifteenth anniversaries of the renewal of ML 30122 respectively.
CATCHWORDS:	MINING LEASE – determination of compensation – factors to be considered EVIDENCE – expert valuation evidence – rationale not given for expert opinion COMPENSATION – grazing property also used for tourism and fossicking – impact on tourism to be taken into account Land Court Act 2000 Mineral Resources Act 1989 State Development and Public Works Organisation and Other Legislation Amendment Act 2015 BHP Billiton Mitsui Coal Pty Ltd v Isdale & Ors [2015] QSC 107 Gregcarbil Pty Ltd v Backus & Ors (No. 4) (2013) QLCR 458 Horn v Sunderland Corporation [1941] 2 KB 26 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
APPEARANCES:	Mrs AJ Smith agent for the applicant Mr EJ Morzone of Counsel for the respondent
SOLICITORS:	Emanate Legal for the respondent