Wambo Cattle Company Limited v Queensland Electricity Transmission Corporation Limited

[2001] QLC 5

[2001] QLC 5

 

LAND COURT

BRISBANE

23 FEBRUARY 2001

Re:     Application for Costs
  In the matter of determination of compensation -
  Resumption of an Easement for Electrical Works Purposes -
  Acquisition of Land Act 1967
(A99-58)

BETWEEN:

Wambo Cattle Company Limited

Claimant

AND

Queensland Electricity Transmission Corporation Limited

(Trading as Powerlink Queensland)

Respondent

D E C I S I O N

In a judgment delivered on 13 December 2000, compensation in the above matter was determined in the total amount of $25,228 comprising loss in land value $20,000 and disturbance $5,228 (being professional fees as agreed between the parties).
           The amount of compensation finally claimed by the claimant in the proceedings was $470,228, amended from an original claim in the amount of $1,208,000.  The amount of the valuation put in evidence by the constructing authority was $15,228.
Section 27 of the Acquisition of Land Act 1967 relevantly provides as follows:

"(1) Subject to this section, the costs of and incidental to the hearing and determination of the Land Court of a claim for compensation under this Act shall be in the discretion of that court.

(2) If the amount of compensation as determined is the amount finally claimed by the claimant in the proceedings or is nearer to that amount than to the amount of the valuation finally put in evidence by the constructing authority, costs (if any) shall be awarded to the claimant, otherwise costs (if any) shall be awarded to the constructing authority."

The constructing authority is the party to whom costs of and incidental to the hearing and determination of the claim for compensation may be awarded in this matter pursuant to subsection (2).

Application was duly made for costs by the constructing authority in a written submission to which the claimant responded in writing.  A subsequent reply to that response has now been received from the respondent.

The claim for compensation followed resumption by the constructing authority of an easement over unzoned land west of Dalby, the highest and best use of which was accepted as being for development of a cattle feedlot.  The easement was designed to accommodate two parallel 275 kV electricity transmission lines supported on steel tower structures, the closest line being about 900 metres from the site of the proposed feedlot pens.
           The claimant's case was based on opinions that the presence of the electricity transmission lines within the field of vision from the feedlot site, the position of which was fixed by the approval, would cause Japanese clients to perceive that potential existed for electric and magnetic fields (EMF) associated with the powerlines, to contaminate beef produced from the feedlot. It was argued that Japanese consumers were particularly sensitive to any potential health risks and their custom was critical to the success of a feedlot producing beef for the export market. EMF related potential health risks are the subject of demonstrably wide public concern and continuing scientific study.  The basis of the claim for compensation was that any loss of potential Japanese custom would destroy the economic viability of the development proposal.
           The respondent's case, apart from argument as to the question of the market value of the approved and licensed site, was essentially that, based on specific scientific investigation, the feedlot pens as designed were external to the range of EMF associated with the powerlines within the easement.  Furthermore, despite the significant worldwide scientific studies there was no basis for allegations that EMF associated with high voltage powerlines caused risk to human or animal health.  It was further argued that even if a perception of health risk did exist that perception would need to translate into an adverse effect on market value which in this case was denied. 
           It was found that there was potential for the market value of the licensed feedlot site to be adversely affected by the perception issue.  To the extent of the principle involved the claimant was successful.  However, the degree of effect was found to be slight rather than disastrous as claimed.

Constructing Authority's Submission

The respondent constructing authority submitted, inter alia, that:

·the claim was so greatly exaggerated as to make litigation necessary and unavoidable;

·all relevant findings of fact with the exception of the "perception issue" were in its favour;

·the "perception issue" significantly added to the hearing time;

·the claimant's allegations were misconceived and ignored the factual position regarding location and visibility of the powerlines;

·the impact of the "perception issue" on market value was found to be nominal.

The Claimant's Response

In response to the constructing authority's submission the claimant submitted that there was no proper basis for asserting that there was anything grossly exaggerated in its claim "so as to cause offence to the Court by maintaining an apparently unmaintainable position"; the claimant had relied on honestly held professional opinions and had arguable cases in respect of all elements in its claim; there was no demonstration of willingness on the part of the respondent to increase its offer so as to approach in a "commercial sense" the compensation to which the claimant was found to be entitled; the claimant recovered 166% of the amount contended for by the respondent.

The claimant drew attention to the fact that the subject matter of the claim (the impact of a high voltage powerline easement over feedlot land) had not previously been considered by the Land Court, which Court would take comfort in now having expressed opinions which might assist in negotiation of compensation claims relevant to easements over other existing or proposed feedlots.  Indeed it was submitted that the proceedings could be viewed as having a public interest component through the precedent created.  It was suggested that the Court, if influenced to accept the public interest submission, would be comforted by the observations and findings, of the majority, of the High Court in the matter Oshlack v. Richmond River Council (1997) 96 LGERA 173.

Findings

It is accepted that there is significant public interest in the debate relevant to EMF and the perception, in some quarters, of potential health-related risks associated with electricity transmission lines. 
           The stance taken by the claimant may well have been influenced by its interpretation of the degree of that public interest.

However I am unable to accept that this particular matter could be characterised as representing public interest litigation.  The amount of compensation payable for diminution in market value caused by the resumption of the easement for electricity works purposes, was determined on factual issues. 

Both parties in this matter acknowledged the weight of the observations of the Land Appeal Court in Yalgan Investments Pty Ltd v. Council of the Shire of Albert (1997-98) 17 QLCR 401. At pp.406-408, after consideration of the leading decisions on the scope and exercise of the Land Court's discretionary power relative to the award of costs, the Land Appeal Court stated in summary form in paragraphs (a) to (k), the propositions for which the judgments and Section 27 of the Acquisition of Land Act stand. 
           After consideration of each of those propositions, paragraph (k) is seen to be particularly relevant in this matter:

"(k)  Where the Land Court is considering whether it should award costs to a constructing authority, it could be wrong to have regard merely to the amounts of the claim and of the award and of the value put in evidence by the authority.  Usually it would be more relevant to enquire whether the conduct of the claimant (such as, for example, making an exorbitant claim) has been such as to force the authority, unreasonably and unnecessarily, into litigation (Moyses & Ors v. Townsville City Council (1979) 6 QLCR 271 at p.274) or whether the claimant has pursued a vexatious, dishonest or grossly exaggerated claim or presented his case in such a way as to impose unnecessary burdens on the constructing authority or the Court (Banno & Another v. Commonwealth of Australia (1993) 81 LGERA 34 at p.53)."

There is no suggestion here that the claimant had pursued a dishonest or vexatious claim. The quantum of the final claim had been based on professional advice. The claimant could hardly have been expected to do other than seek compensation based on the professional advice received. Nevertheless, it is the claimant who must take responsibility for litigating the claim based on that advice, in full knowledge of the respondent's stance, based on its professional advice, and the possible consequences relevant to sub-section (2) of Section 27 of the Acquisition of Land Act.
           The respondent was largely successful in defending the amount of its valuation.  The award of compensation is a clear indication that the claim was exorbitant.  It is accepted that the respondent was forced into litigation by the quantum of the claim.
           There is, however, another consideration.  It was the respondent's stance that the perception of potential for EMF/health-related risk associated with high voltage powerlines, was not an issue which, in this case, caused injurious affection to the land external to the easement.  The respondent was unsuccessful in principle in that stance, although the effect in strictly related compensation terms was slight. 
           It seems clear that the perception issue is one not necessarily confined to specific land uses, and recognition of its existence in compensation payments would be a matter of concern to any authority engaged in the construction of works with EMF association.  The constructing authority in this case strenuously put its case in relation to the issue but, in principle, failed.
           The burden of proving any element of a claim for compensation rests with the claimant.  However, in circumstances where there is a lack of conclusive market evidence to either prove or disprove a claim, yet logic suggests that there is a basis for the claim, then the benefit of doubt must be resolved in favour of the claimant.
           It is one of the constructing authority's submissions that this matter would never have proceeded to litigation had the claim been realistic in terms of the award.  That may have been so, but I am not persuaded that settlement would have been possible had that necessitated admission by the respondent that, in principle, compensation should have included an amount in recognition of the perception issue.
           Conversely I am not persuaded that settlement was possible while ever the claimant adopted the stance that the perception issue had, in the circumstances of this matter, the disastrous effect on which the claim was founded.
           The constructing authority acknowledged in its submission that the perception issue significantly added to the hearing time.  Disposal of the valuation principle argument, to include the hearing of scientific evidence and argument and the Japanese-related perception evidence and arguments, certainly accounted for part of the hearing time.  However the quantum-related evidence and argument was of greater significance in terms of the hearing time.
           One of the submissions of the claimant was that "it would be an inappropriate exercise of a discretionary power which resulted in lay persons coming before the Court with a claim for compensation and the compensation payable to them being determined to be a substantial amount in excess of what is offered by the Respondent and then having achieved that result have it rendered negatory by the award of an order for costs against those claimants exercising their rights".  It is arguable in this matter whether the claimant could be fairly described as a "lay person".  It is unfortunate, of course, that the amount of the award is, no doubt, disproportionate to the costs of litigating and defending the claim.  However, both parties would have been well aware of the statutory provisions relative to the question of costs.  As Brennan CJ observed in Oshlack (supra) - "Costs are awarded to indemnify a successful party in litigation, not by way of punishment of an unsuccessful party".
           With consideration to the two aspects of this matter, I have come to the conclusion that the constructing authority should bear part of its own costs as might be apportioned to the principle involved in the perception issue.  The remainder of its costs which I see as relating to the clearly exorbitant claim both in terms of the added value of the feedlot licence and the monetary effect of the perception issue should be borne by the claimant.

Order

In exercising the discretion of the Court I order that the claimant pay to the constructing authority seventy per cent (70%) of its costs of and incidental to the hearing and determination by the Court of the claim for compensation.
If the parties are unable to agree as to the amount of such costs, it is ordered, pursuant to sub-section (5) of Section 34 of the Land Court Act 2000 that the costs be decided by the appropriate assessing officer of the Supreme Court, under the scale of costs prescribed by law for proceedings in the Supreme Court.

RE WENCK

MEMBER OF THE LAND COURT