LAND COURT OF QUEENSLAND
CITATION:
Integrated Global Resources Pty Ltd v McKelvie [2014]
QLC 51
PARTIES:
Integrated Global Resources Pty Ltd
(applicant)
v
Kimmelle Hope McKelvie
(respondent)
FILE NOS
MRA616-13
DIVISION:
General Division
PROCEEDING:
Determination of compensation payable for renewal of
mining lease
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 for ML 90020 is determined in the
amount of One Thousand Two Hundred and Fifty
Dollars ($1,250) per annum.
2. The compensation is payable by the applicant to the
respondent within 30 days of the grant of renewal of
ML 90020 and in each subsequent year of the term
of ML 90020 is payable on the anniversary of the
date of grant of the renewal.
CATCHWORDS:
MINING LEASE – determination of compensation –
factors to be considered – lack of material from parties
Land Court Rules 2000, Rule 36A
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 applicant miner is seeking the renewal, for a term of 10 years, of Mining Lease (ML)
90020, which expired on 30 April 2013. The lease is over an area of 10 ha 3 km east of
Mount Isa and is for the purpose of “workshop/machinery/storage”. The parties have not
lodged a compensation agreement with the Mining Registrar who has, on 11 October
2013, referred the matter of compensation payable by the miner to the respondent
landowner to this Court for determination. The Court has the benefit of the material
forwarded by the Mining Registrar.
[2]
On 31 October 2013 the Court wrote to the parties setting a timetable for the exchange
and provision to the Court of their evidence and submissions regarding compensation.
That timetable concluded on 4 January 2014. The respondent was represented by Simon
Pate of Gun Lawyers, Mt Isa, and the applicant was represented by UTM Global, a
mining tenement services organisation. UTM Global provided a draft compensation
agreement on behalf of the applicant miner. The only hearing statement provided to the
Court was filed on behalf of the respondent. That statement was received on 11 April
2014. The 11 April 2014 date was the last day of a new timetable set by the Court on 7
February 2014 for the provision of material related to compensation.
[3]
The parties have not been able to reach agreement on compensation so the Court wrote to
them on 2 October 2014 advising of its intention to determine the matter without an oral
hearing in accordance with Rule 36A of the Land Court Rules 2000. Any objection to
this, with reasons, and any further material, was due by 4.00pm on 23 October 2014.
There was no response from either party so the Court will carry out its task of
determining compensation on the material held on the file.
The applicable law
[4]
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 these matters, no
agreements in registrable form have been lodged with the Mining Registrar and the
matters have been referred to the Court for determination.
2
[5]
The issues which must be considered by the Court are set forth in s 281(3) and (4) of the
MRA.
[6]
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.”
[7]
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.”
[8]
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.”
[9]
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.
[10]
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.
[11]
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
[12]
The compensation offered to the respondent landowner is contained in a draft agreement
which refers to the aspects of compensation relevant to the Court’s consideration. It is
$500 to be paid in advance at the start of each calendar year of the mining lease. The
1
2
3
4
5
(1986-87) 11 QLCR 64, 74 – 75.
(1992-93) 14 QLCR 139, 146.
(10 March 1998) unreported.
[2001] QLRT 89, 9, 10, 14.
Horn v Sunderland Corporation [1941] 2 KB 26, 43 per Jacobs J.
3
respondent does not agree. In the statement provided by Gun Lawyers it is pointed out
that no basis is given for the offer of $500 per annum, the site is unfenced, littered with
old machines and a potential hazard for the respondent’s cattle. The applicant has a total
paid up capital, it is submitted, of $360. The respondent does not agree to the transfer of
the mining lease, a matter separate to what the Court must decide, At a minimum, the
respondent seeks the following:
“The applicant pay the respondent:
1. the commercial costs to have the property fenced. Estimate $15,000.00;
2. a security deposit in the sum of $10,000.00;
3. $1,000.00 for each livestock injured or deceased as a result of the
applicants’ activities;
4. any infrastructure costs and ongoing costs including water supply to the
site;
5. $2,000.00 per year for the loss of use of the land over the site;
6. the shareholders of the applicant sign personal guarantees;
7. the applicant have insurance cover in a sum of not less than 20 million
dollars.”
[13]
The proposed compensation agreement is criticised as not providing for any personal
guarantees, for cost of fencing or loss of stock. A copy of the ASIC database extract for
the applicant was provided along with the statement.
[14]
I will consider the respondent’s seven items of claim seriatim:
1. There is no evidence of any actual costing or particulars of the fencing. The Court
could not act on the bare figure provided.
2. There is no justification provided for the size of the deposit or for it being required.
3. There is no evidence of injury or death of livestock or of the value being a realistic
estimate of a loss which in any case is theoretical at present on the evidence provided.
4. There is no evidence of the need for or cost of any infrastructure.
5. There is no explanation of how this figure would be a realistic compensation for loss
of use of the land.
6. There is no demonstrated need for personal guarantees. There is no basis shown for a
reasonable belief that the applicant would not pay such compensation as may be
ordered.
7. There is no explanation of why this would be required at this, or any, level or of the
cost of it.
[15]
The applicant offers $500 per year compensation and the respondent seeks, in respect of
that part of the claim in item 5, $2,000 per year for the loss of use of the land. The other
items are not, for the reasons given, able to be the subject of further consideration.
[16]
Considering what has been put before the Court and in view particularly of the evidence
of old machinery on the land as a potential hazard to the respondent’s cattle, weighed
4
against the implicit fact that in the absence of fencing the cattle are not excluded from the
lease and may graze over it, the evidence is that the respondent is not in fact excluded
from using the land for her cattle business purposes. It remains possible that the
respondent might be so excluded in the future.
[17]
There has not been any evidence provided of the value of lost stock carrying capacity on
the land in question.
[18]
In all the circumstances of this case as disclosed in the evidence provided, the
compensation will be determined at a total of $1,250 per annum for the period of the
lease. It will be payable by the applicant to the respondent within one month of the date
of grant of renewal of ML 90020 and in each subsequent year for the term of the lease on
the anniversary of the date of grant of the renewal.
Orders
1.
Compensation for ML 90020 is determined in the amount of One Thousand Two
Hundred and Fifty Dollars ($1,250) per annum.
2.
The compensation is payable by the applicant to the respondent within 30 days of
the grant of renewal of ML 90020 and in each subsequent year of the term of
ML 90020 is payable on the anniversary of the date of grant of the renewal.
WA ISDALE
MEMBER OF THE LAND COURT
5