Ulg Pty Ltd v M.D.H Pty Ltd

[2014] QLC 50

LAND COURT OF QUEENSLAND

CITATION:

ULG Pty Ltd & Ors v M.D.H. Pty Ltd [2014] QLC 50

PARTIES:

ULG Pty Ltd, Warren Reuben Smith, Alan Frederick Searle, Barry John O’Neill, Duane Price, Michelle Maree Hornby, Wayne Allen Hornby
(applicants)

v

M.D.H. Pty Ltd
(respondent)

FILE NO:

MRA053-14

DIVISION:

General Division

PROCEEDING:

Determination of compensation payable for renewal of mining leases

DELIVERED ON:

9 December 2014

DELIVERED AT:

Brisbane

HEARD ON:

Submissions closed on 23 October 2014

HEARD AT:

Heard on the Papers

MEMBER:

WA Isdale

ORDERS:

1. Compensation payable to the respondent for ML 2656 is determined in the total sum of Four Hundred Dollars ($400).

2. The compensation shall by payable by the applicants to the respondent within one month of the renewal of the mining lease.

CATCHWORDS:

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

Mineral Resources Act 1989, ss 279, 281(3) and (4)

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 (1986-87) 11 QLCR 64

APPEARANCES:

Not applicable

Background

1. The applicants (miners) hold Mining Lease (ML) 2656 in the following shares:

   Warren Reuben Smith       -     50%
   ULG Pty Ltd                    -     26%
   Barry John O’Neill           -     10%
   Alan Frederick Searle       -     10%
   Duane Price  -     2%
   Michelle Maree Hornby     -     1%
   Warren Allen Hornby       -     1%
   The Department of Natural Resources and Mines approved the transfer of the lease to them on 24 January 2014. The previous holders were Warren Reuben Smith (50%) and Mary Lillian Smith (50%).

2. On 21 February 2014 the Mining Registrar referred to the Land Court the matter of assessing compensation for the lease as no agreement between the miners and the landowner had been lodged. The mining lease applied for has a period of five years and an area of 2.02 ha. It is located 130 km south of Cloncurry. The purpose of the lease is for mining gold and the ores of silver, copper, molybdenum and zinc. The land usage was for cattle breeding and fattening.

3. On 7 March 2014 the Court wrote to UMT Global Pty Ltd and to the respondent landowner, M.D.H. Pty Ltd, requiring the provision by the parties, to the Court and to each other, of material in support of the compensation which they sought. There was a timetable set for the process which ended on 9 May 2014. There was no response until 2 July 2014 when UMT Global, a mining tenement services organisation, requested that new dates be set. A new timetable ending on 3 September 2014 was e-mailed to [email protected]. Nothing came of that.

4. On 2 October 2014 the Court wrote to the parties advising of its intention to determine the matter under Rule 36A of the Land Court Rules 2000 without an oral hearing if no objection, with reasons, was received by 4.00pm on 23 October 2014. Any material or submissions were to be forwarded to the Court by then. An e-mail dated 12 October 2014 was received from Julie McDonald, Chief Financial Officer of “MDH Pty Ltd”. It referred to the Court’s letter and requested copies of previous correspondence. The Court replied on 13 October 2013 by e-mail attaching copies of the correspondence requested. Nothing further has been received. The Court has a duty to determine compensation and in the circumstances will proceed to do so. The Court has the benefit of the material provided to it by the Mining Registrar.

The applicable law

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 agreement in registrable form has 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](1986-87) 11 QLCR 64, 74 – 75.

1. 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, 146.

2. In 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.

3. In determining compensation under s 281 of the MRA, the Court has adopted the same approach that Deputy President Smith (as he then was) took in Richardson v Barrett.[4] The matters set out in the section are matters to be taken into account in determining compensation, rather than being separate heads of compensation requiring separate treatment to arrive at an accumulated figure.

   [4][2001] QLRT 89, 9, 10, 14.

4. 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] Care must also be taken to ensure that there is no “doubling up” of compensation. This Court is a specialised Court and will apply its own expertise in order to assist it to perform its function.

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

5. The Court, under s 281(3) of the MRA, “shall settle the amount of compensation” that the landowners are entitled to. It must set a monetary figure which is certain.

Determination of compensation

1. In the absence of any evidence or submissions from the parties the Court must determine the compensation from the material to hand in the Court file which has been referred to above, and its own expertise. The file contains a copy of a compensation agreement between the respondent and Warren Reuben Smith. It relates to ML Application No. 2656 and is dated 3 November 2008. Compensation in respect of the matters to which the Court has regard under the MRA was agreed at a nil value. The miner was to undertake rehabilitation and an access route was agreed. The Court has the material provided by the Mining Registrar from which most of the information referred to has been gained.

2. Compensation is determined in the amount of a total of $400 for the full period of ML 2656. The compensation shall be payable by the applicants to the respondent within one month of the renewal of the mining lease.

Orders

1.     Compensation payable to the respondent for ML 2656 is determined in the total sum of Four Hundred Dollars ($400).

2.     The compensation shall be payable by the applicants to the respondent within one month of the renewal of the mining lease.

WA ISDALE

MEMBER OF THE LAND COURT