Stoverink, A v Higgins
[2016] QLC 26
•21 April 2016
LAND COURT OF QUEENSLAND
CITATION: Stoverink, B v Higgins; Stoverink, A v Higgins [2016] QLC 26* PARTIES: Bernardus Johannes Maria Stoverink
(applicant MRA389-15)Antonius Gerhardus Albertus Stoverink
(applicant MRA388-15)v Andrew Massey Home Higgins
(respondent)FILE NO: MRA388-15 & MRA389-15 DIVISION: General Division PROCEEDING: Determination of compensation for renewal of mining claims DELIVERED ON: 21 April 2016 DELIVERED AT: Brisbane HEARD ON: Submissions closed on 11 November 2015 HEARD AT: Heard on the papers JUDICIAL REGISTRAR: GJ Smith ORDERS: 1. In respect of MC60049 compensation is determined in an amount of $45 per annum in respect of the renewal period of 5 years, giving a total amount of $225.
2. That Bernardus Johannes Maria Stoverink
pay compensation to the respondent in the amount set out in Order 1 within one month from notification of the renewal of the mining claim by the Department of Natural Resources and Mines.
3. In respect of MC60301 compensation is determined in an amount of $410 per annum in respect of the renewal period of 10 years, giving a total amount of $4100.
4. That Antonius Gerhardus Albertus Stoverink
pay compensation to the respondent in the amount set out in order 3 within four months from notification of the renewal of the mining claim by the Department of Natural Resources and Mines.
CATCHWORDS: MINING CLAIM – determination of compensation -renewal – factors to be considered – weight of material provided – impact of mining and drought conditions.
Mineral Resources Act 1989, s 85
Land Court Rules 2000, Rule 36AFazzari v Colonial Agricultural Company Limited [2003] QLRT 38
Mitchell v Oakhill and Mitchell (Unreported, Land Court of Queensland, JJ Trickett, President, 10 March 1998)
Wills v Minerva Coal Pty Ltd [No 2] (1998) 19 QLCR 297APPEARANCES: Not applicable
This matter involves two referrals to the Land Court pursuant to s 85(5) of the Mineral Resources Act 1989 (MRA) for the determination of compensation in respect of the renewal of a mining claim.
Background
Bernardus Johannes Maria Stoverink applied for the renewal of Mining Claim 60049 on 23 January 2015 and Antonius Gerhardus Albertus Stoverink applied for the renewal of Mining Claim 60301 on 30 March 2015. The land upon which the Mining Claims are located is approximately 80 km north-west of Cunnamulla in the Quilpie District. The land is within the Paroo Shire Council local government area. The purpose of the proposed renewal is for the mining of opal, gemstones and corundum.
The land upon which the Mining Claims and access tracks are situated is known as Boobera Station and is owned by Andrew Massey Home Higgins (the respondent). The land is more particularly described as Lot 21 on Plan HU 53 and is approximately 26452.73 hectares in area. The opal mined on Boobera Station is known as the Koroit Opal.
The specific Land Court reference and tenure details are set out as follows:
Court Reference Tenure ID Tenure Area Access Term MRA388-15 MC60301 12.67 ha 1 km 10 years MRA389-15 MC60049 1 ha 1.02 km 5 years
Relevant Legislation
Section 85 of the MRA provides that a mining claim shall not be granted or renewed unless compensation has been determined (whether by agreement or by determination of the Land Court) between the applicant and each person who is the owner of land the subject of the application and of any surface access to that land. In respect of this matter, no agreement has been lodged with the Department of Natural Resources and Mines (DNRM) and accordingly the matter has been referred to the Land Court for determination.
The matters that must be considered by the Court are set out in s 85(7) MRA which provides that an owner of land is entitled to compensation for:
(a) deprivation of possession of the surface of land of the owner;
(b) diminution of the value of the land of the owner or any improvements thereon;
(c) diminution of the use made or which may be made of the land of the owner or any improvements thereon;
(d) severance of any part of the land from other parts thereof or from other land of the owner;
(e) any surface rights of access;
(f) all loss or expense that arises;
as a consequence of the grant or renewal of the mining claim.
Section 85(8) MRA enables various additional factors to be included in the compensation assessment. In the present case, only paragraph (e) is relevant. It provides as follows:
“(8) In assessing the amount of compensation payable under subsection (7) -
…
(e) an additional amount shall be determined to reflect the compulsory nature of action taken under this chapter which amount … shall be not less than 10% of the aggregate amount determined under subsection (7).”
In Wills v Minerva Coal Pty Ltd [No 2][1], when considering a provision effectively identical to s 85 MRA this Court observed 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.”[1] Wills v Minerva Coal Pty Ltd [No.2] (1998) 19 QLCR 297 @ 315.
Similarly in Mitchell v Oakhill and Mitchell[2], the then President of the Land Court observed in relation to s 281 MRA:
“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.”
[2] (Unreported, Land Court of Queensland, JJ Trickett, President, 10 March 1998).
I have applied the principles from these judgments in undertaking the present determination of compensation pursuant to s 85 MRA.
The Conduct of the Proceedings
On 9 September 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 5 of 2013.
On 5 October 2015 the applicant’s submission and attachments were received by the Court. The respondent’s material and submissions were received by the Court on 29 October 2015 and a reply to that material from the applicant was received on 9 November 2015.
I have examined all the material provided by the parties and the related submissions. A summary of the parties’ submissions is set below[3].
[3] The text of the submissions has been mostly retained to preserve the tenor of the points being made.
The Applicants’ Contentions
The applicants contended that:
- Determination by the Land Court is sought “as each miner or individual might have other agreements for their Mining Claim or Mining Lease compensations with Mr Higgins”.
- There is no rural property near Boobera and surroundings that could justify double the compensation within 5 years.
Other landowners for holdings “Moolya” and “Merimo” are seeking compensation for similar land at $15.00/Ha per year.
- A rural property “Yerrel” & “Humeburn” which adjoins Boobera Station is for sale for the sum of $5,145,000 with a land area of approx. 245,000 acres i.e. this property can be purchased for $21/acre including main homestead, quarters and well maintained and presented and infrastructure.
- Double compensation within 5 years is not justified “where you can see and experience that this land cannot sustain any stock to feed. Goats roaming around means that this will affect the last vegetation there is. What is coming after the sheep, cattle and goats with a future were less rainfall is predicted?”.
- Both claims are unfenced so stock that might have been around can access the claim areas.
- Compensation should be $15.00/ha, this is fair and affordable and the same as what the landholders around Yowah are receiving. When compensation is fair for the miner and landholder it will open prospects and opportunities to other miners to have a go for opal mining at “Boobera”.
The Respondent’s Contentions
The respondent contended that:
The respondent has owned Boobera Station since 1986. The property has been family owned for in excess of 90 years.
A total of 1049.58 hectares is lost in total to mining activities on Boobera Station.
Compensation agreements on Boobera Station are for the surface area of the mining lease or claim only i.e. not for the total area lost to grazing and farming activities. The total surface area of mining, for which compensation is paid is 230.49 hectares.
There are currently 22 Mining Claims and 13 Mining Leases on Boobera Station.
The landowner has an extremely good working relationship with 95% of the tenure holders but would prefer to have no Mining Leases or Mining Claims on his property but is realistic about this.
Since 1986 the landowner has personally negotiated numerous compensation agreements with only one tenure, ML60402, requiring determination by the Land Court. No submission was put forward by the miner or landowner and the Court determined compensation at $5.58 per hectare, well below the accepted rate.
Since 1990 the landowner has requested and received (with 1 exception) an amount of $25.00 per hectare for the surface area of each mining lease/claim.
In late 2014, after consultation with spouse and the majority of tenure holders on Boobera Station the respondent decided to request $50.00 per hectare for all new and renewing claims/leases. (since then this amount has been negotiated with 11 tenure holders). The decision is in line with the most recent property valuation report of May 2015 by Heron Todd White, valuers, prepared for our financiers, Suncorp Metway. Mining tenures devalue the property and make it harder to sell.
Boobera Station is a working cattle and sheep station currently in the 4th year of extreme Drought. The cost to the landowner and his wife on administration matters and time relating to the 35 tenures, when desperately trying to save stock and water on our property far exceeds the $50.00 per hectare we currently seek and accept from the tenure holders.
Mr Antonius Stoverink, the brother of the applicant, has been the holder of MC60301 (formerly ML60229) since approximately 2003. During this time the respondent has not ever seen any mining on this tenement. At all times the applicant, on behalf of his brother, has paid the compensation of $25.00 per hectare per year.
Mr Stoverink has sold MC 60049 for $6000. The purchaser has moved onto MC60049, and set up a camp. The purchaser has advised the landowner he paid Mr Stoverink $6000.00 and is waiting for compensation to be paid so the transfer can be finalized. It is incredulous that MC60049 can be sold for $6000.00 (1 Hectare) and yet the holder can dispute an amount of $50.00 per hectare per year for compensation, totalling $250.00.
At all times, since the applicant has been the holder of MC60049, he has paid the requested amount of $25.00 per hectare.
The respondent has not doubled the amount of compensation on 5 years as asserted by the miner as the rate of $25.00 per hectare has been the rate the past 25 years without increase.
Although the respondent is unsure of the current CPI rate, a rise in line with the CPI each year since 1990 would result in a greater amount of compensation than the current rate requested of $50.00 per hectare. The price of Koroit opal has substantially increased since 1990.
While the applicant makes a comparison between Boobera Station and Moolya Station at Yowah, there are significant differences between the two locations e.g. Boobera Station has 35 current tenures with a surface area of 230.49 hectares; Mooyla Station has approximately 72 Mining Claims and 14 Mining Leases with a combined surface area of approximately 80 hectares; Moolya Station is within Restricted Area 25, which restricts the size of mining leases and claims. The amount of area lost to mining on Moolya Station is significantly less than that lost on Boobera Station; the inconvenience to the owner of Moolya, is significantly less than the inconvenience to Boobera Station, and therefore the compensation requested is significantly less than that requested on Boobera Station.
Merimo Station abuts Moolya Station and is also located within Restricted Area 25. The inconvenience of mining on Merimo Station is significantly less than the inconvenience of mining on Boobera Station.
We are in our 4th year of severe drought so naturally the ground is bare. In a normal season I usually run 200 head of cattle and 1500 head of sheep in the particular paddock where the applicant’s claims are.
The submission at Point 9 of the applicant, and his attachment 9, [Re offer for sale of “Yerrel” & “Humeburn” are not relevant as the valuation provided in this submission shows the improved value of Boobera at $50.36 per hectare. The applicant at this point also has failed to advise the court he has recently sold MC60049 for an amount of $6000.00 for a single hectare, therefore totally contradicting his argument that the value of the land is significantly less than $50 per hectare, when he has sold a mining claim of 1 hectare for $6000 Does this sale indicate that the value of 1 hectare of land on Boobera is valued at $6000 per hectare?
The applicant in his submissions has incorrectly stated that the landowner has doubled the amount of requested compensation in 5 years. The amount of compensation requested has remained at the same rate for a period of 25 years.
The miner states that he has not seen stock, only goats around the area of his claims. This is because the land around the claims/leases is avoided by our cattle and sheep because of the noise and activity surrounding the claims/leases. Although we are only compensated for surface area of the claims/leases, a larger area of land is lost to Grazing and Farming activities than is acknowledged or compensated by the miners.
The applicant has stated that my stock has access to his unfenced leases/claims. Luckily my stock avoid the leases and claims, as 8 unfenced and unsafe shafts of various depths of over 10 meters is extremely unsafe to my stock. I would make the submission that unsafe areas on each of the 35 mining claims and leases on Boobera make it unsafe for stock to be around the area of the claims and leases, therefore further indicating the need for me to manage stock away from the leases and claims where possible.
An inspection by Mines Health and Safety in February 2015 resulted in the Applicant being requested by the Department of Natural Resources and Mines to make safe, and fence or fill over 8 deep shafts on MC60049.
The landowner was the holder of working mining lease ML60152 from 1994 to 2005 and is also well aware opal mining on Boobera Station and of the rewards of opal mining and the value of Koroit Opals.
The amount of $50.00 per hectare accurately reflects the cost to me in administration and lost grazing land, and is an amount I am prepared to accept as compensation for the loss of land and the cost of administering agreements etc associated with Opal Mining on Boobera Station.
Reply by Applicants
The applicants’ reply is set out as follows:
Mining tenures over Boobera Station have a surface area of 230.49ha, said to be .87% of the total area of the property. The area of MC60049 and MC60301 is .0525% of the total area.
The landowner claims 1049.58 Ha is lost to mining activities and that this is 3.965% of the total area of 26452.73 ha. Most miners are mining during the cooler months from April to Mid-October and a few miners continue mining over the summer months. “To state that the total surface area is lost to grazing and farming because of mining is 1049.58 ha is in my opinion overrated”
MC60049 and MC60301 are not fenced and accessible for stock to be on or to pass through the whole year.
The miner has a good relationship with Mr Higgins and other miners at the Koroit Opal field.
The miner was not consulted in late 2014 by Mr Higgins regarding the requested compensation increase from $25.00/ha per year to $50.00/ha per year.
The miner notes that the Herron Todd White valuation report shows $50.36/ha and this includes buildings and 3 country classifications. The Miner does not believe that there is a direct relation between compensation for a mining tenure and property value. The mines at Boobera station are leases. The compensation requested by Mr Higgins at a rate of $50.00/ha per year “....you purchase your mining claim or mining lease year by year”.
Compensation for a mining tenure is meant to compensate for the loss of surface area of the mining tenures for grazing. MC60049 and MC60301 are not fenced and there is no loss of income.
The applicant cannot seek compensation for administration matters even relating to Mining tenures. It is just part of life.
Regarding the document and agreement between the parties involved for the purchase of MC60049. The purchase included security, financial assurance and necessary infrastructure to mine for opal in the form of mine shaft and drives to allow direct access to the opal bearing levels. The fact that MC60049 has minimum mining activities and the fact that the purchaser was shown opal and where it could be found is a good enough reason to purchase MC60049. The purchaser indicated that he found opal in the claim and expressed that “he is very happy”.
The compensation for Mining tenures MC60049 and MC60301 have been paid to the landowner Mr Higgins in full in the past and also up front for the full term after receiving notice of grant of renewal from the Mines Dept.
By applying CPI rate every year since 1990 is not applicable as the tenure holders were satisfied with the compensation agreements for the last 25 years.
To my opinion the compensation for a Mining tenure is meant to compensate for the loss of surface area of the Mining tenure for grazing.
Moolya Station runs cattle and sheep in the same paddock where the township of Yowah and the Yowah Opal field are situated. Cattle have been moved recently from this paddock.
On both MC60049 and MC60301 there are no improvements present made by the landowner. MC60049 borders a stock fence over a length of 100m. This is reflected in the valuation report with the rate of 50.36/Ha were the land is provided on a land fenced and watered basis. I would classify the surface areas of MC60049 and MC60301 and surrounding land unimproved land.
Mr Higgins, the landowner is requesting compensation of $50.00/ha/year for the new term of 5 years. This is a 100% increase compared to the previous term of 5 years.
The applicant is not aware of any inspection report from the Mines Dept that the protection of the shafts on MC 60049 was unsafe during the time as tenure holder.
11 signed compensation agreements @ 50/Ha per year out of a total of 35 mining tenures. Does not constitute a majority of tenure holders.
- The requested rate of $50/ha per year “implements a purchase your mining claim or mining lease year by year. Who would not like a lease where the tenants pay close to the current market value rate year by year? ”
- The statement of Mr Higgins that the amount of $50.00/ Ha does accurately reflect the cost in administration and lost grazing land is not supported by any evidence while the actual surface area of all mining tenures on Boobera Station is less than 1% of the total surface area.
Consideration of Evidence
With the agreement of the parties the determination of compensation in respect of these claims has been undertaken on the written material filed by the parties and the referral documents provided by DNRM without the necessity of a full hearing with evidence from witnesses.
The parties have also elected to proceed without reliance upon valuation or other expert evidence in relation to the factors set out in s 85(7) MRA. This approach is not uncommon and understandable given the likely costs that would otherwise be incurred.
The contentions of the parties regarding this determination are largely based upon the following:
i.Compensation agreements concerning tenures on Boobera Station and the surrounding area.
ii.Extract of 5 pages from a valuation report undertaken for mortgage security purposes for Suncorp by Herron Todd White of Boobera Station.
iii.Details regarding the marketing of a local property “Yerrel” & ”Humeburn”.
iv.The sale of MC 60049 and improvements/ infrastructure for $6000.00.
v.The observations and views of the parties concerning local mining and grazing activities.
Other than (v) the matters detailed in [19] are of limited weight without additional expert analysis addressing the relevant criteria set out in s 85(7) MRA e.g. an extract from a valuation report for mortgage security purposes of an improved grazing property with an area of 26452 ha will necessarily involve significantly different considerations than a valuation completed for the purposes of a compensation determination pursuant to the MRA. I am also reluctant to place any reliance on the valuation amount given that the following clause appears on extracted page 24 of the valuation report:
“This valuation report is for the use of Suncorp Metway Ltd and it’s Mortgage Insurers and may be relied upon only by the party to whom it is addressed and no other parties are entitled to use or rely upon it and the valuer does not assume any liability or responsibility to any other party who does so rely upon the valuation without the express written authority of the valuer”
Similarly, the advertised sale price and associated marketing details of the substantially improved, 99000 ha grazing property “Yerrel” & “Humeburn” is, in the absence of a completed sale and additional analysis of very limited value. Likewise compensation agreements may be highly variable, site specific and may have been formulated as a result of a multitude of factors not necessarily related to s 85(7) MRA.
Notwithstanding the limited weight of this evidence I have no doubt that the parties have made their best efforts to address the issues as they see them. The submissions have assisted in gaining a better understanding of the subject areas and the related grazing and mining activities.
I have also considered the material provided by DNRM as part of the referral pursuant to s 85(5) MRA. I have noted the location, area, purpose and period of renewal sought for each claim. I have also examined the individual mining claim work programs and noted the method of mining to be undertaken, the equipment to be used, the months during which mining is proposed to occur and a sketch of each claim and associated workings.
Although there are no relevant determinations within the local district, I consider that the amounts contended by the parties fall within a range that is not unrealistic when considered as a total annual amount. Accordingly, on the basis of the material and submissions before me and in the absence of expert evidence I propose to consider the submissions of the parties using the amounts contended as guiding parameters.
The differences between the parties mostly concern the degree of impact of mining on Boobera Station and a claim for “owner’s time” relating to administration of the subject tenures by the respondent. These differences must necessarily be considered in light of the severe drought conditions which have prevailed for at least the last four years.
In this regard Paragraph 7 of the applicant’s submission dated 30 September 2015 states- “attachment 7 shows pictures from MC60301”. The attachment includes four colour photographs said to be of the area surrounding MC60301and contains the following observations:
“This information is provided to give an impression about the area where mining for opal is proposed on MC60301.
There is no infrastructure like dams, powerlines, sheds, houses on or near the claims and the current use is Low Intensity Grazing.
The surface of MC60301 and MC60049 is barren ground through overstocking, not enough rainfall and is covered with sand, rocks, dead trees, bush and there is no growth of stock feed.
Since ML60229=MC60301 and MC60049 is assigned into my brothers and my name in 2003 we have seen no cattle or sheep on this part of the property. We have seen only goats and wildlife”.
The respondent/landowner’s reply is set out below:
“With regard to the applicant’s attachment 7. As previously stated, we are in our 4th year of severe drought so naturally the ground is bare. The applicant is in no position to judge stocking rates and is contradictory to his statement that he hasn’t seen any stock. In a normal season, I usually run 200 head of cattle and 1500 head of sheep in the particular paddock where the applicant’s claims are.”
The respondent’s contention that “in a normal season, I usually run 200 head of cattle and 1500 head of sheep in the particular paddock where the applicant’s claims are” represents a critical difference between the parties as the miner’s contentions are based on the drought conditions that have prevailed for at least four years, whereas the respondent’s contentions are seemingly premised on “normal season” conditions and related stocking rates.
The material before me does not include specific details of stock losses or contended impacts on stocking rates occasioned by either MC60049 or MC60301. In the circumstances given the severe drought conditions and the bare state of the ground I conclude that the impact of the mining claims is minimal.
A related submission by the respondent is that an additional 1049.58 ha of Boobera Station is lost to mining activities. It is unclear exactly how this overall area has been determined and what, if any portion is attributed to the mining activities on MC60049 or MC60301. As there has been very little mining activity on MC60301 since as early as 2003 and given MC60049 is only 1 ha in area, on the material before me I am unable to attribute any amount of compensation in respect of the impact of mining activities upon the balance land external to the respective claim areas.
The respondent’s submission also includes a general claim on the basis of what is sometimes referred to as “owner’s time”. The relevant contention is that “the cost to my wife and I on administration matters and our time relating to the 35 tenures when we are desperately trying to save stock and water on our property far exceeds the $50.00 per hectare we currently seek and accept from the tenure holders”.
The respondent contends in reply that he “…cannot seek compensation for administration matters even in relation to Mining Tenures. It is just part of life” and further that “The statement of Mr Higgins that the amount of $50.00/Ha does accurately reflect the cost in administration and lost grazing land is not supported by any evidence…”
Despite the general nature of the respondent’s contention regarding “owner’s time”, I accept that an amount in respect of this time should be included in the determination. The applicant’s submission regarding the lack of supporting evidence is relevant in relation to the details regarding calculation, however on the material before me a minimum amount of $50/ha is sought. It is recognized that owner’s time can be difficult to quantify[4], and while I am satisfied that the respondent has expended an amount of time that would qualify for inclusion pursuant to s 85(7)(f) MRA, I am unable to accept that compensation should be assessed at a minimum of $50 per ha as urged. In the absence of more detailed calculations I am prepared to make a modest overall allowance in respect of this aspect of compensation.
[4] Fazzari v Colonial Agricultural Company Limited [2003] QLRT 38 at [13]
In the absence of valuation evidence addressing the matters set out in s 85(7) MRA the determination has been necessarily limited to the material before me and in the absence of recent Court determinations within the local area I have confined myself within the range contended by the parties. The material before me does not lend itself to allocating all aspects of compensation e.g. owners time on a neatly uniform rate/ha and accordingly, compensation has been expressed as an annual overall amount rather than on a per/ha basis.
Using my best endeavours and after considering all the relevant facts, circumstances and the material before me, I determine compensation in an amount of $45 per annum in respect of MC 60049 for the renewal period of 5 years. The total amount of $225 is to be paid by the applicant to the respondent within two (2) months of the renewal of MC60049 by DNRM.
Likewise, in respect of MC 60301 compensation is determined in an amount of $410 per annum for the renewal period of 10 years. The total amount of $4100 is to be paid by the applicant to the respondent within two (4) months of the renewal of MC60301 by DNRM.
The compensation determined in each case is inclusive of the additional amount envisaged by s 85(8)(e) MRA.
ORDERS
1. In respect of MC60049 compensation is determined in an amount of $45 per annum in respect of the renewal period of 5 years, giving a total amount of $225.
2. That Bernardus Johannes Maria Stoverink pay compensation to the respondent in the amount set out in Order 1 within one month from notification of the renewal of the mining claim by the Department of Natural Resources and Mines.
3. In respect of MC60301 compensation is determined in an amount of $410 per annum in respect of the renewal period of 10 years, giving a total amount of $4100.
4. That Antonius Gerhardus Albertus Stoverink pay compensation to the respondent in the amount set out in order 3 within four months from notification of the renewal of the mining claim by the Department of Natural Resources and Mines.
G.J.SMITH
JUDICIAL REGISTRAR
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