LAND COURT OF QUEENSLAND

1. [1]
   This matter concerns a referral to the Land Court of a mining compensation matter from the Mineral Hub, Department of Resources (“Resources”) pursuant to s 279A of the Mineral Resources Act 1989 (“MRA”). The referral was filed in the Land Court on 30 June 2020.

Background

2. [2]
   On 29 September 2014, the applicant, GOTAP Pty Ltd (“GOTAP”), applied to renew ML 95439 for a period of 10 years. The mining lease is for the purpose of open cut opal mining.

3. [3]
   The mining lease is in the Winton Mining District on a property known as Vergemont (Lot 278 on OL363). Access to the mining lease, however, is via the adjacent property owned by the respondent, Christopher James Skelton, Lot 1 on RK4 (Eildon Park) and Lot 2 on RK5 (Mayneside). The length of access is agreed to be a total of 11.8 km and the width of 5 m, the total area comprising 5.9 ha. There has been engagement between Mr Jackson, Sole Director of GOTAP, and Mr Skelton regarding compensation but no agreement.

Relevant legislation

4. [4]
   Section 279 of the MRA provides that a mining lease shall not be granted or renewed unless an agreement in relation to compensation has been filed or, in the absence of such an agreement, a determination of compensation has been made by the Land Court. In this matter, no agreement has been lodged with Resources which is why the matter was referred to the Land Court for determination.

5. [5]
   Section 281 of the MRA sets out those matters which must be considered by this Court when determining compensation. In particular, s 281(3)(a) provides that an owner of land is entitled to compensation for:

“(i)  deprivation of possession of the surface of land of the owner;

2. (ii)
   diminution of the value of the land of the owner or any improvements thereon;

3. (iii)
   diminution of the use made or which may be made of the land of the owner or any improvements thereon;

4. (iv)
   severance of any part of the land from other parts thereof or from other land of the owner;

5. (v)
   any surface rights of access;

6. (vi)
   all loss or expense that arises;

as a consequence of the grant or renewal of the mining lease.”

6. [6]
   The assessment to be undertaken in accordance with s 281 was discussed in Wills v Minerva Coal Pty Ltd [No 2],^[1] 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.”

The conduct of the proceedings

7. [7]
   On 5 February 2021, the Court made the following orders in relation to the ongoing conduct of this matter:

1. By 4.00pm on Friday, 5 March 2021, Gotap Pty Ltd must file in the Land Court registry and serve on Christopher Skelton a compensation statement, including all evidence relied on to support the compensation statement.

2. By 4.00pm on Friday, 2 April 2021, Christopher Skelton must file in the Land Court registry and serve on Gotap Pty Ltd a response to the compensation statement, including all evidence relied on to support the response to the compensation statement.

3. By 4.00pm on Friday, 16 April 2021, Gotap Pty Ltd must file in the Land Court registry and serve on Christopher Skelton a reply, if any, including all evidence relied on in reply.

4. Unless the parties otherwise request in writing, the case will be determined on the filed material without an oral hearing not before Tuesday, 20 April 2021.

8. [8]
   On 4 March 2021, an outline of argument and related documents including maps and the Originating Application were filed by Mr Jackson on behalf of GOTAP.

9. [9]
   On 1 April 2021, Mr Skelton filed his compensation statement attaching a haulage and plant hire quotation and the court order made in Washington v Skelton.^[2]

10. [10]
    On 14 April 2021, Mr Jackson filed a reply to Mr Skelton’s compensation statement.

11. [11]
    For ease of reference, I will refer to Mr Jackson as representative of GOTAP throughout these reasons.

12. [12]
    The primary issue in dispute is the responsibility and cost of maintaining the access road.

The contentions of the parties

13. [13]
    Mr Skelton submits:

1. that Mr Jackson should be required to maintain the road. He says that “the road should be graded and the creek crossings maintained twice a year – once before the wet season (that is, the end of the mining season) and once after wet season before the start of the mining season”, which he describes as “prudent property management”;^[3]

2. if the Court is not minded to require Mr Jackson to maintain the road, compensation should be determined taking into account a quote obtained from a service provider for twice yearly grading of the road;

3. alternatively, it appears that Mr Skelton submits that if he (Skelton) is required to maintain the access road, Mr Jackson should be responsible for 20% of the maintenance costs based on Mr Skelton’s understanding that access via the track is currently granted to the holders of four other mining interests and that ultimately maintenance costs should be shared between users; and

4. under the head of ‘Other Costs’, Mr Skelton submits that quarterly weed inspections of the access road should be conducted. The inspection would take one hour at $50/hr, totalling $200, Mr Jackson’s share being 20% or $40/pa.

14. [14]
    Mr Jackson contends that:

1. compensation would be reasonable if determined by the Court at $8.50 per hectare per annum for the access area.^[4] This amount is derived from the purchase price of the property Mayneside by a previous owner when the property was valued at $8.50/ha – which Mr Jackson says equates to $1,300 for deprivation of the surface of the land for the term of the lease;

2. GOTAP should not be responsible for the grading of the access road but accepts that neither should Mr Skelton be responsible “for the upkeep of this track for my access to ML 95439”;^[5]

3. GOTAP should not bear the cost of quarterly weed inspections.^[6] Mr Jackson says light vehicles are regularly cleaned and “our mining machinery has not left this area for at least 20 years”.^[7] This, he says, contrasts with Mr Skelton’s “cattle road trains which regularly transit from vast distances across his properties with no cleaning operations”;^[8] and

4. Mr Jackson is willing to pay a fee to use Mr Skelton’s private road, despite seeing no loss to his business interests.

15. [15]
    Mr Jackson in reply says that there are in the order of 12 miners with interests in the area and other users of the access road such as opal buyers.^[9] He says that the access is currently maintained by the users, and it is in their interest to do so. He suggests that the quote for maintenance provided by Mr Skelton is excessive noting that the supplier is located in Longreach, “a 640km round trip… to complete a job which will take no more than 2 hours”.^[10] He also challenges the proposed timing of maintenance works.

16. [16]
    In relation to current maintenance of the access road, Mr Skelton says it appears that Mr Jackson “is happy to allow other miners to maintain the road (at their cost), but wants no liability should they not do so and I, as the landowner, are forced to step in and maintain them”.^[11] He says that without agreements in place, there is no legal obligation for maintenance works to continue.

Consideration

17. [17]
    In the present matter, neither party has submitted any expert evidence for the Court to consider in the course of assessing the matters specified in s 281 of the MRA. In his material, Mr Skelton does not submit that compensation is payable for the deprivation of the surface; for the diminution of the value or the use of the land; for severance; nor for surface rights of access. His submission is focussed on loss or expense that arises as a consequence of the renewal of the mining lease, and in that regard, he identifies two components: maintenance of the road and ‘other costs’, specifically for weed inspections.

18. [18]
    Mr Jackson, in his compensation statement, proposes a method of calculation of compensation seemingly for deprivation of the surface of the land as described at [14.1] above. Despite this, in his compensation statement Mr Skelton says that he does use the road for part of his farming operations, including to access the homestead and the cattle yards during mustering. There is no suggestion in this that Mr Skelton’s use of the road will be impacted by the grant of the mining lease and there is therefore no basis upon which to determine compensation of deprivation nor diminution of the land.

19. [19]
    In my view, Mr Jackson should not be solely responsible for the maintenance of the road. Mr Skelton does not submit otherwise. The road is used by at least four other miners and by Mr Skelton. Mr Jackson says that it is in the interests of the miners that the road be maintained and therefore it is unnecessary to attribute responsibility for maintenance, and that past practice would demonstrate this.

20. [20]
    I am informed by the recent case Washington v Skelton,^[12] and adopt some of the wording from [29] of that decision. If Mr Skelton must engage contractors to grade the road because it has not been graded by Mr Jackson or other miners with access agreements to use the road, then Mr Jackson should pay no more than one sixth of the cost of any reasonably necessary track maintenance work within 28 days of presentation of an invoice. The six shares represent the use of the road by Mr Jackson, the four holders of mining claims referred to in Mr Skelton’s compensation statement, and Mr Skelton.

21. [21]
    Regarding weed inspections, Mr Skelton submits that a weed inspection should be conducted four times a year by his Manager, allowing one hour for the inspection at $50/hour, and that Mr Jackson should be liable for an apportionment of that expense, namely 20% as the road is used by four other miners. Mr Skelton does not explain why a weed inspection is required quarterly nor the specific activities involved in such an inspection. As noted above, Mr Skelton does use the road for part of his farming operations. I assume that use extends to his Manager. It would seem to me that some or all of the inspections would be undertaken in the usual business of the farming enterprise. I think it unlikely that Mr Skelton or his Manager would make a special trip quarterly to inspect the track for weeds. Despite the lack of adequate information, I will allow one inspection a year with Mr Jackson to be responsible for a one sixth share but rounded up to $10/pa.

Orders

I determine that GOTAP Pty Ltd must pay Christopher James Skelton compensation in respect of ML 95439 as follows:

1. one sixth of the cost of one weed inspection being the sum of Ten Dollars ($10) paid per annum; and

2. if the access road is not maintained and Mr Skelton incurs that expense, one sixth of the cost of any reasonably necessary track maintenance within 28 days of presentation of an invoice.