Queensland Judgments
Authorised Reports & Unreported Judgments
  • sclq logo
  1. Caselaw
  2. QSC
  3. 2017
  4. Inkerman Station Pty Ltd v Allan (No 2) - [2017] QSC 243

Authorised Reports & Unreported Judgments
Exit Distraction Free Reading Mode
  •  Notable Unreported Decision

Inkerman Station Pty Ltd v Allan (No 2)[2017] QSC 243

Inkerman Station Pty Ltd v Allan (No 2)[2017] QSC 243

 

SUPREME COURT OF QUEENSLAND

 

CITATION:

Inkerman Station Pty Ltd as Trustee for the Inkerman Station Trust v Allan & Ors (No. 2) [2017] QSC 243

PARTIES:

INKERMAN STATION PTY LTD (ACN 111 342 495) AS TRUSTEE FOR THE INKERMAN STATION TRUST

(Applicant)

v

KEVIN ALLAN, REGIONAL MANAGER LAND SERVICES AND AUTHORISED DELEGATE OF THE MINISTER FOR NATURAL RESOURCES AND MINES UNDER THE LAND ACT (MINISTERIAL) DELEGATION (NO 1) 2015

(First Respondent)

and

MINISTER FOR NATURAL RESOURCES AND MINES

(Second Respondent)

and

STATE OF QUEENSLAND

(Third Respondent)

and

HARVEST HOME HOLDINGS PTY LTD (ACN 074 967 169) AS TRUSTEE UNDER DEALING 710323641

(Fourth Respondent)

FILE NO/S:

CS No 289 of 2016

CS No 17 of 2017

CS No 209 of 2017

DIVISION:

Trial

PROCEEDING:

Application

ORIGINATING COURT:

Supreme Court at Cairns

DELIVERED ON:

27 October 2017

DELIVERED AT:

Cairns

HEARING DATE:

13, 14, 15 June 2017

JUDGE:

Henry J

ORDERS:

  1. The decision of 26 April 2016 to conditionally approve the fourth respondent’s application dated 2 March 2012 for approval that its rolling term lease be used for an additional purpose is set aside.
  2. I will hear the parties as to whether further orders are required and as to costs at 10am on Tuesday 7 November 2017 (out of town parties have leave to appear via telephone) unless they agree on consent orders in respect of those matters in the meantime.

CATCHWORDS:

ADMINISTRATIVE LAW – JUDICIAL REVIEW – GROUNDS OF REVIEW – GENERALLY – STATUTORY INTERPRETATION – where the applicant seeks a statutory order of review regarding an ‘additional purpose’ approval to a grazing lease – where the ‘additional purpose’ approved was for low key tourism – whether or not ‘low key tourism’ both does not interfere with and is complementary to the grazing purpose

Aronson & Groves, Judicial Review of Administrative Action, 5th edition

Acts Interpretation Act 1954 (Qld) s 14B

Land Act 1994 (Qld) ss 61(2)(b) ss 15, 112, 121, 153, 154, 155(2)(c), 158(2), 164A, 201, 209, 213, 214, 391A

Land Regulation 2009 (Qld) ss 27, 37A

AG (NT) v Minister for Aboriginal Affairs (1989) 23 FCR 536, cited

Enfield City v Devt Assess Cmmn (2000) 199 CLR 135, applied

Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355, applied

Timbarra Protection Coalition v Ross Mining NL [1999] 46 NSWLR 55, applied

Woolworths Limited v Pallas Newco Pty Ltd (2004) 61 NSWLR 707, applied

COUNSEL:

R N Traves QC and N Andreatidis for the applicant

M T Hickey for the first, second and third respondents

R W Haddrick for the fourth respondent

SOLICITORS:

Clayton Utz for the applicant

Crown Law for the first, second and third respondents

Preston Law for the fourth respondent

  1. The applicant applies for a statutory order of review of the first respondent’s decision of 26 April 2016 to approve the additional purpose of low key tourism to a grazing lease.  Second and third applications have been made in respect of the first respondent’s decisions of 26 October 2016 and 30 March 2017 to approve the fourth respondent’s applications for extension of time to comply with conditions imposed as part of the decision.
  2. The reasons which follow deal solely with the question of whether the additional purpose “is complementary to, and does not interfere with, the purpose for which the lease was originally issued”, a test appearing in s 154(2) Land Act 1994 (Qld) (“the Act”).[1]  I found that question to be a jurisdictional question of fact in the course of the hearing.[2]  This has the consequence, unlike most judicial review cases, that I must determine a question of fact on the merits.  In so doing I may have regard to the information before the decision-maker as well as the additional evidence adduced before me.[3]
  3. The applicant submitted, with the agreement of the fourth respondent and without contradiction by the remaining parties, that until the question of jurisdictional fact has been determined and the parties have had an opportunity to consider my reasons, I should not deal with the first application’s allegations of errors of law or process in the first respondent’s approval of the primary application, or consider the second and third applications.  I will take that approach.

Background

  1. Dinah Island, the property with which the application is concerned, is situated on the Staaten River, Cape York.  In addition to the river surrounding it, Dinah Island is about 5,040 hectares and has an adult cattle carrying capacity of about 500 to 600 beasts.  It is Crown land.  A Rolling Term Lease, issued pursuant to the Act, commenced over it on 10 August 1995 for a term of 20 years.  Its term was extended by two years in November 2013 and for a further 20 years in August 2015, to 9 August 2037.[4] 
  2. The purpose for which the lease was granted was required by s 153 of the Act to be stated in the lease.  It was stated to be “primary industry (grazing) – Crown land”. 
  3. The present registered lessee, Harvest Home Pty Ltd as Trustee (“HHH”), is the fourth respondent, an entity operated by Mark McFadyen.  When HHH acquired the lease, there were already facilities on Dinah Island including cabins which had from time to time been used by visiting tourists.  Mr McFadyen’s company also allowed tourists to visit the property, evidently to go fishing.  The extent to which it developed that activity as a paying enterprise was in issue at the hearing. 
  4. Road access to Dinah Island is gained by an ungazetted road or track through a much larger cattle property bordering Dinah Island to the north, known as Inkerman Station.[5]  The use of the ungazetted road through Inkerman Station by persons allegedly travelling to and from Dinah Island has for some years been a source of tension between HHH and the corporate lessee of Inkerman Station, the applicant (“Inkerman Station”).  In an earlier application I ordered by consent, on 27 May 2014, that the present applicant allow such vehicular access provided that it is for the purpose of the Dinah Island lease, namely primary industry (grazing) purposes. It appears this has not prevented continued vehicular access of Dinah Island via Inkerman Station by tourists.
  5. On 2 March 2012, HHH lodged an application for renewal of the Rolling Term Lease.  As part of that application, made in tandem with a then prospective purchaser of the lease, it sought approval for the lease be used for an additional purpose, namely “low impact eco-tourism”. 
  6. An earlier involved decision-maker decided in 2014 to offer the additional purpose, subject to certain conditions.  On 16 September 2014, subsequent to the filing of earlier judicial review proceedings, the decision-maker revoked that decision, indicating the application would be considered afresh and that Inkerman Station would be afforded the opportunity to provide submissions.  Further submissions and information were received by the decision-maker.  It appears the prospective purchaser’s interest fell away but the application was persisted in, consistent with HHH’s own continuing desire for approval of the purpose of low impact eco-tourism. 
  7. On 26 April 2016, the decision-maker decided to approve HHH’s application, including the additional purpose of “low key tourism” upon the lease, subject to certain conditions being met.

The statutory regime

The Act

  1. Section 15 of the Act allows the Minister to lease unallocated State land.  Sections 112 to 120 stipulate such a lease may only be made available via a publicly competitive process in which the lease is made publicly available for auction, tender or ballot. The circumstances under which a lease of unallocated state land may be granted without competition are limited[6] and of no present relevance.
  2. Section 153 of the Act provides that a lease must state the purpose for which it is issued.  The Land Regulation 2009 (Qld) imposes a regime for determining rent in respect of different lease purposes.  Significantly the rent for a primary production purpose such as grazing is much less than the rent for a business purpose such as tourism.[7]
  3. Section 154 of the Act allows the Minister to approve an application that a lease be used for additional or fewer purposes as the case may be.  It relevantly provides:

“154 Minister may approve additional purposes

  1. The Minister may approve an application by a lessee that a lease be used for additional or fewer purposes.
  2. However, the Minister may approve an application by a lessee that a lease be used for an additional purpose only if –
  1.  the additional purpose is complementary to, and does not interfere with, the purpose for which the lease was originally issued; or
  1.  the additional purpose relates to the production of energy from a renewable source, including, for example, the sun or wind. …” (emphasis added)
  1. Section 154(1) and (2), creates a two-phase process.  Firstly, it is necessary for the decision-maker to conclude the additional purpose complies with the restrictions in s 154(2) – a jurisdictional question of fact.  Of the two restrictions mentioned in s 154(2) it is only the restriction in s 154(2)(a) which is relevant and will be considered in this case.  If the additional purpose is not so compliant the application must fail because it does not meet the jurisdictional threshold.  If it is compliant then, secondly, the decision-maker must consider whether or not the discretion conferred by s 154(1), to approve the application, should be exercised.  As will be seen, the distinction between the jurisdictional and discretionary phases in s 154 needs to be born in mind in identifying the relevance or otherwise of a fact to the first phase as distinct from to the second phase.
  2. Section 154 gives an existing leaseholder the considerable advantage of being able to secure approval for an additional purpose without having to undergo the publicly competitive process referred to above.  The quid pro quo for the conferral of that advantage is s 154(2)’s threshold restriction on the extent of the additional purpose, particularly the requirement that “the additional purpose is complementary to, and does not interfere with” the lease’s original purpose.  This restriction, with its continuing emphasis on the original purpose, is discussed at greater length below.  Such a restriction is consistent with a legislative intent that s 154 not be used as a device by lessees to largely abandon the lease’s original purpose and benefit from the pursuit of a new purpose without having to submit afresh to the above mentioned publicly competitive process.
  3. The risk of recalcitrant lessees not complying with a lease’s original or additional purpose can be addressed under the Act by the imposition of conditions.  The Minister has power under s 203 to subject a lease to conditions the Minister considers appropriate.  Section 391A also empowers the Minister in giving any approval permitted by the Act to give the approval subject to conditions.  The power to decide an application under s 154 includes, pursuant to s 420I, the power to grant the application subject to conditions to be complied with before the application is granted.  Further, s 154(3) in conjunction with s 210, provides a mechanism by which the applicant is notified on approval of the s 154 application as to whether and in what way the lessee should apply to change the conditions of the lease having regard to the proposed purposes.  Compliance with conditions can be scrutinised and enforced via the Minister’s powers to request information from the lessee about the lease,[8] to impose and vary a performance security condition for failure to comply with conditions,[9] to cancel or forfeit a lease for non-compliance with conditions[10] and to issue remedial action notices for which non-compliance is an offence and can trigger the addition of further conditions or reduce the term of the lease.[11]
  4. The decision to be made by the Minister under s 154 may be delegated pursuant to s 392 to the chief executive or an officer or employee of the Minister’s department.  Section 420B(1) provides the “chief executive may keep guidelines … about the making of applications … for the information and guidance of departmental staff and persons dealing with the department”.  Two such guidelines assumed relevance in the history of this case.

The Guidelines

  1. The first guideline, Diversification of Leases for Agricultural Purposes PUX/901/337, applies to agricultural leases and does not apply to leases of the kind with which this case is concerned.  In the context of applying the restriction in s 154(2)(a) it relevantly provides:

“Policy

When considering applications by lessees to use agricultural leases for additional purposes a proposed activity may be considered to be complementary even if it is not related to agriculture, if the activity contributes to the viability and ecological sustainability of the enterprise, and allows the activity of agriculture to flourish where otherwise it may not have.  For this to occur, the activity must be of sufficiently small scale to ensure that it does not become the dominant or principal activity.

Should a lessee wish to expand the new activity to the extent where it becomes the dominant activity, other options such as applying to freehold the lease or excise an area for the new activity may be considered. …

Rental

The small-scale nature of permissible additional uses on leases that allow agricultural activities will allow rental categories to remain unchanged.  The low impact nature of farm-based tourism, filmmaking and nature conservation does not justify re-categorisation. …

Incremental Progression

It is essential that the guideline not be used to support incremental progression of additional uses to the point where such additional use becomes the dominant use.  Such a use would not meet the complementary requirements of the Land Act 1994 and as such, could not be lawfully condoned.  It would also result in a lessee not paying a fair rental for the land, which could discriminate against and disadvantage other lessees. …

Mechanisms for monitoring and regulating this include the provisions of the Sustainable Planning Act 2009 (SPA) and the inclusion of suitable conditions in the lease. …

Multi additional uses

It is possible that lessees may wish to pursue multiple additional uses.  In principle this is acceptable provided each use conforms with the requirements of this policy and the aggregation of the additional uses do not become the main use i.e. the additional uses do not overtake the primary use of the lease. …” (emphasis added)

  1. The guideline contains a schedule listing a number of potential additional purposes, namely, “Low Key Tourism”, Documentaries and Film making”, “Nature Conservation” and “Vocational Training in Pastoral activities”.  Its purpose is said to be to assist lessees make an application and assist decision-makers arrive at a decision that accords with the Act.  It relevantly provides:

“SCHEDULE

ACTIVITY DATE

CRITERIA

APPROVAL CONSIDERATIONS

Low Key Tourism

. Use of existing infrastructure with minimal capital investment. (eg renovations to existing homestead, old shearers’ sheds and workers cottages, camping in tents, fencing, walking tracks etcetera

.  Allow.

.  Add sub-purpose and conditions

 

. Some additional structures / infrastructures – up to four accommodation units (catering for up to 16 guests), and an amenities building.  These would be in addition to use of the existing homestead, shearers’ sheds or workers cottages.

.   As above, subject to Sustainable Planning Act 2009 requirements.

. Lessee should be encouraged to prepare a Property / Management Plan.

. Lessee should be encouraged to undertake a heritage assessment of older buildings and consult with the EHP …”

(emphasis added).

  1. The schedule’s use of the term “low key” in respect of tourism and its limitation on the extent of extra buildings is consistent with the guideline’s earlier emphasis that the additional purpose must not overtake or dominate the use of the land for the original purpose or become the main use of the land.
  2. The second guideline, Additional purposes of lease PUX/901/333, does on its face have application to the present matter, though much of its detail in respect of grazing leases relates to the erection of dwellings and is irrelevant.  For present purposes it relevantly provides:

“Purpose/Scope

…An additional purpose must be complementary to and not inferere with the purpose for which the lease was originally issued.

Further, the imposed conditions of the lease may need to be changed under section 210 of the Land Act having regard to the proposed purposes for which the lease is to be used …

Policy

ADDITIONAL PURPOSES

An additional purpose should not result in a significant change i.e. to a “lesser” purpose or an upgrade of the lease. …” (emphasis added)

  1. The above emphasised passage is presumably intended to mean that approval of an additional purpose should not result in a significant lessening in use of the land for the original purpose.  This is consistent with, though articulated slightly differently than, the interpretation of s 154(2)(a) reflected in the first of the above guidelines.
  2. Pooling the interpretations implicit in both guidelines it appears that the department’s interpretation of the restriction in s 154(2)(a) is that the additional purpose must not result in a significant lessening in the use of the land for the original purpose and must not overtake or dominate the use of the land for the original purpose or become the main use of the land (“the department’s interpretation”).  In fairness to the author(s) of those guidelines it seems likely that the department’s interpretation blends considerations relevant to both phases of the s 154 process, namely the threshold jurisdictional question of fact and the subsequent exercise of discretion.

The issue

  1. The issue that is the question of jurisdictional fact arising out of s 154 in its application to the present case, is whether the additional purpose of low key tourism, or low impact ecotourism as it was described in the application, is “complementary to, and does not interfere with, the purpose for which the lease was originally issued”, namely “primary industry (grazing) – Crown land” (the “purpose of grazing”).  It is for the applicant, as the party seeking to challenge the decision-maker’s conclusion that the jurisdictional fact existed, to prove the additional purpose does not have that quality.[12]
  2. The question whether the additional purpose of low key tourism, or low impact ecotourism as it was described in the application, is “complementary to, and does not interfere with, the purpose for which the lease was originally issued”, cannot be resolved at the theoretical level, merely by reference to the short title ascribed to the proposed additional purpose.  Short title descriptions of purpose, such as low key tourism or low impact ecotourism, may accurately be applied to a very divergent range of activity but say nothing of the extent to which such activity will be complementary to or will interfere with grazing activity.  The answer to the question turns upon the factual detail of what is proposed to be done under the title of low key tourism or low impact ecotourism, including in the context of the use of the land for the purpose of grazing.  Such detail is needed to discern whether or not the additional purpose is complementary to and does not interfere with the lease’s originally issued purpose.  It follows that the question falling for determination requires consideration of what was in fact proposed to be done in this case in using the lease for the additional and initial purpose.
  3. It might be thought that question could be resolved purely by reference to what is detailed as proposed to be done in the application.  However, there is a factual dispute about what, on the true facts of the case,[13] is proposed to be done.  The applicant for review argues, inter alia, that the fourth respondent has not been using the lease to a significant extent for the purpose of grazing and, in reality, proposes to pursue tourism predominantly and not as a purpose complementary to grazing.  As will be seen, that argument draws partly upon evidence of the fourth respondent’s past patterns of use of Dinah Island.  This includes the apparent conduct of a tourism business there for some years, inconsistently with the lease’s hitherto sole purpose, and preferring to expend significant funds upon the tourism venture than the long subdued grazing venture.
  4. Before turning to the facts it is helpful to first consider the meaning in s 154(2)(a) of the words “complementary to, and does not interfere with the purpose for which the lease was originally issued”. 

The interpretation of s 154(2)(a)

  1. Sub-sections 154(1) and (2) in referring to purposes are referring to the use of the lease for those purposes.  As much follows from the context in which each contain the words “lease be used for”.  To remove doubt, in these reasons references to the effect of the additional purpose upon the original purpose are short hand references to the effect of the use of the lease for the additional purpose upon the use of the lease for the original purpose.  The use of the lease for a purpose must as a matter of inference include the use of the leased land for that purpose.  References herein to the effect of the additional purpose upon the original purpose therefore include the effect of the use of the leased land for the additional purpose upon the use of the leased land for the original purpose.
  2. Turning specifically to s 154(2)(a), the respondents emphasised the phrase “complementary to, and does not interfere with” is compendious and falls for consideration as a whole.  As much is uncontroversial but, as the word “and” and the comma preceding it within the phrase demonstrates, there are obviously two qualities which must be present if the requirements of the term are to be met.  It is necessary both that the additional purpose is complementary to the original purpose “and” that it does not interfere with the original purpose.
  3. The meaning of most of the words in the phrase “complementary to, and does not interfere with the purpose for which the lease was originally issued” seems readily apparent.  However, the meaning of the words “complementary to” in that phrase is not so clear. 
  4. Ordinarily the meaning intended by the words of a statute will correspond with the literal or grammatical meaning of the words used.[14]  In the absence of a definition of the word “complementary” in the Act, dictionary definitions of that word may assist.  Those dictionary definitions are of a similar theme.  For example, the Macquarie Dictionary (Sixth Edition) defines “complementary” as:

“1. forming a complement; completing.

2. complementing each other.”

It in turn relevantly defines “complement” as:

“1. that which completes or makes perfect.

2. the quantity or amount that completes anything.

3. either of two parts or things needed to complete the whole.”

  1. The Oxford English Dictionary (Second Edition Volume 3) relevantly defines “complementary” as:

“1. a. Forming a complement, completing, perfecting.

b. Of two (or more) things: Mutually complementing or completing each other’s deficiencies.”

It relevantly defines “complement” as:

“1. The action of fulfilling or completing; completion, fulfilment, accomplishment. …

  1.  a. The fact or condition of being complete; completeness,  fullness. …
  1. a. That which completes or makes perfect; the completion, perfection, consummation. …
  1. a. The quantity or amount that completes or fills; complete quantity, provision, or set; full allowance, totality.

…

  1. a. Something which, when added, completes or makes up a whole; each of two parts which mutually complete each other, or supply each other’s deficiencies. …”

It also identifies the word “complement” as deriving from the latin word complementum meaning “that which fills up or completes”.

  1. Fowler’s Dictionary of Modern English Usage (Fourth Edition) states:

“Complementary can mean ‘completing’ or ‘forming a complement’, …”

  1. The above concepts of completing something, completing each other’s deficiencies or making up a whole may not at first blush seem apt in the context of there being an original purpose, such as using land for grazing, which is already a whole or complete use in its own right.  However, those concepts, when considered in the context in which the words “complementary to” is used in s 154, bespeak the need for the additional purpose to have a quality which has some positive effect upon the original purpose, that is, which enhances or adds something beneficial to it. 
  2. That need becomes even more obvious when the words “complementary to” are considered in conjunction with the additional words “and does not interfere with”.  That demonstrates that mere compatibility, in the sense of two purposes being able to co-exist without the additional purpose interfering with the original purpose, is not enough.  If it was then the words “complementary to” would have no work to do because the requirement “does not interfere with” would ensure compatibility in the sense mentioned above. 
  3. Thus, while the quality of compatibility will invariably be present as an instance of an additional purpose being complementary to an original purpose, it will remain necessary for the additional purpose to have some positive effect upon the original purpose in order for it to be “complementary to” that purpose.  Put another way, the additional purpose must bring something more positive to the original purpose than the essentially neutral quality of being able to co-exist without interference with it.
  4. Another facet of the quality required by the phrase in question is that the additional purpose ought not impair or detract from the original purpose.  This flows inevitably from the need for the additional purpose to not interfere with the original purpose.
  5. The language of s 154(2)(b) therefore at least minimally requires that the additional purpose must have a positive effect upon the original purpose and not impair or detract from it (the “minimal interpretation”). 
  6. The minimal interpretation is consistent with the part of the department’s interpretation which requires that the additional purpose must not result in a significant lessening in the use of the land for the original purpose. 
  7. As for that part of the department’s interpretation which requires that the additional purpose not overtake or dominate the use of the land for the original purpose or become the main use of the land, such an outcome would in most cases be an inevitable incident of the application of the minimal interpretation.  It is difficult, for instance, to foresee how a use for an additional purpose could be said to “dominate” the use of the land for the original purpose without materially impairing or detracting from it.  However, the words of the section do not per se require consideration of the comparative scale of the use of land for the additional purpose, let alone indicate how to measure whether one purpose can be said to have overtaken or become the main purpose in comparison to another.  The language of the restriction in s 154(2)(a) requires not that the determinative focus be upon the scale of the additional purpose compared to the original purpose but upon the effect of the additional purpose upon the original purpose.  If its effect is to have some positive effect upon the original purpose and not impair or detract from the effective use of the land for the original purpose then the restriction, in the sense meant by the minimal interpretation, will be complied with.  The jurisdiction of the decision-maker being thus enlivened, it would remain for the decision-maker to consider whether the discretion to approve the application ought be exercised.  In that discretionary exercise, which is the second phase of two phase process in s 154, considerations of comparable scale may of course be very relevant.
  8. Some reliance was placed in submissions on the Act’s objects, contained in s 4, which, relevantly for present purposes, provide:

“4. Objects of this Act

In the administration of this Act, land to which this Act applies must be managed for the benefit of the people of Queensland by having regard to the following principles –

Sustainability

  • sustainable resource use and development …

Evaluation

  • land evaluation based on the appraisal of land capability and the consideration and balancing of the different economic environmental, cultural and social opportunities and values of the land

Development

…

  • when land is made available, allocation to persons who will facilitate its most appropriate use that supports the economic, social and physical wellbeing of the people of Queensland

Community purpose

…

Protection

…

Consultation

…

Administration

….”

  1. The principles listed in s 4 as of relevance in the administration of the Act are of obvious importance in administering the exercise of the discretion conferred by s 154(1). It is clear from the matters quoted above in respect of evaluation and development that in administering the Act decision-makers ought to have regard to the balance between economic, environmental, cultural and social opportunities and values of the land and should lease land to persons who will facilitate a use that supports the economic, social and physical wellbeing of Queenslanders.   This all consistent with the prospect that land use might have desirable diverse purposes.  As much is already inherent in s 154 conferring a discretion to permit additional purposes which meet s 154(2)(a)’s jurisdictional threshold of being complementary to and not interfering with the original purpose.  However, s 4 does little to aid interpretation of that threshold jurisdictional question of fact, in the sense contemplated by s 14A Acts Interpretation Act 1954 (Qld).  To the extent it does, the minimal interpretation of s 154(2)(a) is consistent with the apparent purpose of the Act as articulated s 4 and s 4 does not suggest an obvious preferable interpretation.
  2. A view implicit in some submissions of the defendants was that “complementary to” involves focus upon the totality of the use of the land to which the original purpose and additional purpose would give rise.  It was in effect submitted that if that overall use was consistent with the Act’s objects then the additional purpose would be complementary to the original purpose.  In a similar vein, it was submitted the additional purpose would meet the requirement of being “complementary to” if it could co-exist alongside the original purpose without taking away from it and adding to the overall value derived from the land.  Those submissions blur the distinction between the two phase process in s 154. 
  3. It cannot be doubted that in the second phase – the discretionary phase – it would be relevant to the exercise of the discretion to consider whether the overall use of the land to which the purposes would in combination give rise is consistent with the Act’s objects.  Similarly, it may be appropriate in the discretionary phase to have regard to whether the additional purpose adds to the overall value derived from the land.  However, to the extent consideration of the jurisdictional question of fact in s 154(2)(a) may involve consideration of the combined effect of the original and additional purposes, it would only be for the narrow purpose of considering how the additional purpose effects the original. 
  4. Section 154(2)(a)’s focus is solely upon the effect of the additional purpose on the original purpose.  For instance, it provides the additional purpose must be complementary to the original purpose.  It does not provide the original purpose must be complementary to the additional purpose.  It is of course conceivable that an original purpose may have such an effect upon the additional purpose but that is not what s 154(2)(a) requires.
  5. The minimal interpretation of the language of s 154 is supported by s 154’s context in the Act as a whole.  In particular, s 154(2)(a)’s specific focus on the effect of the additional purpose upon the original purpose is consistent with the Act’s publicly competitive regime in respect of the original purpose.  As discussed above, a leaseholder making an application under s 154 avoids submitting to the demands of that statutory regime afresh.  Section 154 is effectively a shortcut past that regime but only if the original purpose will be positively affected in the process.  Thus, the discretion to approve the additional purpose under s 154 is only enlivened if the additional purpose complements and does not interfere with the original purpose.  If the additional purpose has a negative or only neutral effect upon the original purpose then the applicant lessee cannot utilise the shortcut which s 154 represents.
  6. The context in which s 154(2)(a)’s interpretation falls to be considered, namely a statutory threshold which if crossed confers a significant potential advantage on the applicant, suggests the effects of the additional purpose to which its words refer should have substance.  It is possible to conjure up quite superficial or frivolous alleged effects of purposes which in truth would merely co-exist in order to assert that one will have some positive effect upon the other.  The statutory context of the words “complementary to” imports a need for the positive effect required by those words to be of some substance, that is, it should be a material, not superficial or frivolous, positive effect.  Were it otherwise s 154(2)(a) would be an illusory threshold, readily crossed with the exercise of a little imagination in identifying inconsequential or trivial effects. 
  7. Similarly, it would be possible to think up superficial or trivial ways in which a purpose may impair or detract from another purpose.  Unless there were a requirement of some substance to the nature of the alleged impairing or detracting an imaginative opponent to a s 154 application could make s 154(2)(a) an impossible threshold to cross.
  8. I would therefore infer a qualification of materiality from the statutory context, adding it to the minimal interpretation in properly interpreting s 154(2)(a).  I therefore find s 154(2)(a) requires the additional purpose must have a positive material effect upon the original purpose and not materially impair or detract from it.
  9. Before moving on, something should be said of the reliance placed in argument by the respondents on the explanatory memorandum for the Land Bill 1994, which provided in respect of the future s 154:

“Clause 154This clause allows for the addition or subtraction of purposes.  Fewer purposes may be desired by a lessee to obtain a lower rent (through a different rental category).  Additional purposes may be desirable to allow, for instance, for additional sources of income to a lessee.  Additional purposes must be complementary to and not interfere with the purpose for which the lease was issued.  The purpose of the lease is integral to the terms and conditions of the leases, therefore if a totally different purpose is required, then a new lease would need to be applied for, and Chapter 4 Part 1 would apply."

  1. Given the ordinary meaning of s 154(2)(a) is not ambiguous or obscure and is unlikely to give rise to manifestly absurd or unreasonable results it is doubtful that recourse to such extrinsic material serves any purpose unless its content has the potential to assist in confirming the interpretation conveyed by the ordinary meaning.[15]  The content of the above quoted passage does not contain detail of a kind having any particular utility in informing the specific meaning of s 154(2)(a).  To the extent it touches at all upon the first phase in the two stage decision-making process that is the jurisdictional question of fact, its fourth sentence merely repeats the relevant words of s 154(2)(a). 
  2. It was submitted based on the above passage that parliament intended an existing lessee could apply to add an additional purpose to the lease merely for the reason that the new purpose would provide “additional sources of income” to the lessee.  This reference to a potential motivation of a lessee applicant says nothing of parliament’s particular intention as to the requisite nature of the effect of the additional purpose upon the original purpose conveyed by the words “complementary to and does not interfere with”.  That is not to suggest that an additional purpose which generates funds which will be applied to sustain an original purpose would not be complementary to the original purpose.  Indeed, on the face of it, such an effect would be a positive material effect upon the original purpose, making the additional purpose complementary to the original purpose under the interpretation already arrived at in these reasons. 
  3. It was also submitted based on the explanatory memorandum that s 154 permits additional purposes unless they create a “totally different purpose” and that it is for the decision-maker’s discretion to “draw a line” between whether a purpose is additional to but not totally different to the original purpose.  It does not bode well for a submission purportedly relying on an explanatory memorandum for interpretive assistance that it adopts such a strained interpretation of the words of the memorandum.  The memorandum’s reference to a totally different purpose was obviously just a phrase of convenience in the general context of explaining s 154’s place in Chapter 4 of the Act, with its reference to part 1 thereof being a reference to the provisions providing for a publicly competitive regime.  The point being made was not materially different from the point earlier discussed in these reasons about the shortcut around that regime allowed by s 154.  It would be reading too much into the explanatory memorandum to infer that the legislature intended the meaning of “complementary to, and does not interfere with” in s 154(2)(a) to be “is not totally different than”.  The extent of the difference between the original and additional purposes might potentially inform the exercise of the discretion in the second phase of a s 154 decision.  However, in the first phase the focus is not comparative, it is specifically upon the effect of the additional purpose upon the original.
  4. In now turning to resolve this case’s question of jurisdictional fact it is convenient to briefly review the information on which the decision-maker acted, the reasons for the decision and the relevant additional evidence.

Information before the decision-maker

The application

  1. HHH’s application was lodged on 2 March 2012.  It consisted of a completed Department of Environment and Resource Management form and attachment A.[16]  While lodged by the prospective purchaser of the lease, Sandro Tosoni, and his bank manager, the form nominated the applicant as HHH and was executed by Mr McFadyen. 
  2. The operative part of the form, part B, was styled “Application for renewal of rural lease”.  The form described rural leases as “leases issued for grazing, agricultural or pastoral purposes over 100 hectares and issued for a term greater than 20 years”.[17] Boxed paragraph four of the form called for the insertion of “sufficient evidence of what special circumstances exist that would warrant this application being accepted”.  It was endorsed:

“80% current lease expired.  Current lessee wants to sell land/lease and purchaser requires a renewed lease.”[18]

The extensions to the term of the lease, described above, had not occurred by that time.

  1. On the face of the application form it was nothing more than an application to renew a rural lease.  However boxed paragraph 12 of the form, which called for the optional attachment of any additional information to support the application, referred to an attachment A, signed by Mr Tosoni and his bank manager.  Attachment A relevantly stated:

“Existing Land Use Status

Primarily grazing purposes + low impact eco-tourism/recreational activities.

Recreational uses provided by five demountable dwellings + caretakers residence + owners residence.  Visitors are taken on short tours of natural bushland, lagoons and rivers via small boats & vehicles depending on season and weather conditions.  Homestead is occupied by caretaker only during the wet season.

Future/proposed land use status after Rural Lease renewal

Continue primary grazing activities + low impact eco-tourism.

  • Property is for sale by lessee and proposed purchaser (Sandro & Franco Tosoni) requires certainty of lease.  Therefore this application for renewal of Rural lease is initiated by proposed purchaser with full approval by existing lessee. …
  • Proposed purchaser plans to continue grazing activities as the primary land use and allow some recreational activities to take place on the land via a very small number of visitors per dry season.  Visitors will be North Queensland residents looking for outdoor camping and recreational activities.”[19] (emphasis added)
    1. The attachment did not purport to identify the effects of the additional purpose upon the original purpose.
    2. It appears from the department’s internal submission to the decision-maker that attachment A was treated as requesting “approval to include the additional purpose of low key tourism pursuant to section 154(1) of the Act”.[20]  The assertion in that attachment by Mr Tosoni and his bank manager that grazing activity would continue to be the “primary” use of the lease if the additional proposed land use was approved, flags what was to become a determinative consideration in the ultimate decision under review.
    3. As mentioned above, in 2014 a decision-maker decided to offer an additional purpose of low key tourism but revoked the decision after the filing of an application for judicial review by Inkerman Station.[21]  The decision-maker announced the application would be considered afresh and Inkerman Station would be afforded the opportunity to provide submissions.[22]
    4. In the upshot, the sources of submissions and information put before the decision-maker were Inkerman Station, HHH, the Carpentaria Shire Council and the Department of Natural Resources and Mines (“the department”).[23] 

Information from Carpentaria Shire Council

  1. Carpentaria Shire Council had no objections to what the department characterised in its correspondence with the council as an additional purpose of low impact eco-tourism/recreation activities.[24]  Council’s sole expression of concern went to the extension of the lease generally and the accompanying need for conditions dealing with wet season evacuations.[25]

Information from HHH and Inkerman Station

  1. Subsequent to announcing the 2014 decision to consider the application afresh the department wrote to HHH’s solicitor, on 5 March 2015, regarding the request to add an additional purpose of low key tourism to its lease and inviting HHH to make a submission or provide any further information.  The department’s letter provided various information for HHH’s consideration, including the following expression of concern about the impact of the purpose on adjoining land management:

“DNRM has formed a preliminary view that the use of Dinah Island for low key tourism is not consistent with the current purpose and conditions of the lease.  DNRM has identified that low key tourism activities may affect adjoining land and how it is managed through:

  • Increased traffic causing track damage;
  • Public using weapons to shoot feral pigs and risk the health and safety of staff and employees;
  • Public straying off the track and camping unlawfully;
  • Fences being broken;
  • Gates being left opened;
  • Cattle moving between paddocks due to open gates caused by the public;
  • Cattle being distressed and not grazing as they should be able to do with the interference of the public;
  • Increased costs for fence/track repairs, moving cattle back to correct paddocks and obtaining legal advice on ways to mitigate losses;
  • Inconsistent use of leased land if additional tourism use is more than low key in nature.”[26]
    1. HHH’s solicitor provided a submission to the department by letter dated 13 April 2015.[27]  The submission was predominantly directed to the above quoted list of dot points relevant to the impact of the additional use upon adjoining land management.  It is important to appreciate that while the impact of the additional purpose upon the neighbouring land may be relevant to the decision-maker’s exercise of discretion it is of no relevance to the threshold issue of whether the additional purpose is complementary to and does not interfere with the original purpose.
    2. To the incidental extent the submission provided further information about the actual nature and extent of the proposed use, it was as follows:

“In our submission, the addition of a purpose of low key tourism is not inconsistent with the current purpose and the conditions of the lease.  Given the limitations of intensity, we do not consider that it is reasonable to conclude that the additional use of low key tourism will cause any further or different management issues.

…

  • Inconsistent use of leased land if additional tourism use is more than low key in nature

This is not a proper grounds for refusal given that our client is entitled to the presumption that in the event that an additional purpose of low key tourism is added to the existing grazing lease then the additional use will be conducted in a way which is consistent with the approved purpose.”[28]

  1. HHH’s submission of 13 April 2015 also annexed what it described as a Code of Conduct that had been in operation and would be in operation if the additional purpose was approved.  That annexure, styled Rules and Regulations, went mainly to customer conduct whilst on Dinah Island and its waterways.[29]  Such of its content as may arguably be relevant to the effect of the additional purpose upon the original purpose was as follows:

“Strictly No hunting/shooting/pig shooting/bow hunting/firearms/ weapons of any sort are permitted on the property

Strictly No dogs are allowed, please do not ask or try to sneak in, as you will be politely refused entry and forfeit total booking fees

No guided fishing tours and >No fishing boats for hire

No motorbikes or quad bikes permitted

No serviced cabins or meals available …

Hazards on the property include unpredictable terrain/fires/flooding/ waterways/road conditions.  Be alert/aware wary of wild animals especially crocodiles, snakes, dingoes, jellyfish, goannas, feral pigs, cattle & never feed/provoke them …

Vehicle movements around the island must be restricted to the existing/ main roads & designated routes to all areas as per the Owner/Operator/ Manager’s instructions.  Do not make your own tracks.  Only enter areas you have been given specific permission to & do not enter anyone else’s cabin or camp site

Both sides of all main roads are private property.  Anyone entering private property will be prosecuted

Practice a safe driving speed.  Drive to current conditions.  Wearing seatbelts are a necessity …

The Dinah Island property has fence lines & gates; this is a working cattle property.  If you open a gate be responsible & close that gate after crossing.  There is livestock on the property & it has right of way at all times …

Persons need to be fully self-contained.  Bring own food, water, fuel, personal effects, camping/fishing/boating equipment.  There are No supplies available at Dinah Island

Strictly No Entry into any sheds/buildings, No contact with any of property’s equipment/machinery/kitchen/rec room & last 3 end dongas.  Only enter your own cabin

At Cabins, vehicles are permitted inside the fence to the buildings to load and unload gear only.  At all other times all vehicles must remain outside in the park bay. …

Campers must bring all of their bagged rubbish to the Dinah Island approved dump site and leave camp site immaculate and untraceable upon your departure, especially your toilet area. …

Extinguish camp fires whenever you leave your camp site unattended.  Fires at the camp sites are used only in the allocated areas and areas are to be clear of any dry matter …”[30]

  1. Such matters potentially go to whether the proposed purpose does not interfere with the original purpose but not to whether it is complementary to the original purpose.
  2. The department wrote to Inkerman Station’s solicitor on 9 March 2015 regarding HHH’s request to add an additional purpose of low key tourism to its lease and invited Inkerman Station to submit any information it wanted the department to consider.  The department’s letter provided various information for Inkerman Station’s consideration.  This included the following references to HHH not intending to further develop the land and to access via Inkerman Station’s Galbraith holding:

“1. The lessee of Dinah Island has requested the additional purpose of low key tourism be added to the current term lease, which is for grazing purposes.  The lessee has advised it does not intend to further develop the land, only to use the existing infrastructure located on the land. …

  1.   Dinah Island does not have dedicated road access, as can be seen on the attached maps.  However, it appears access to Dinah Island and properties to the north of Galbraith is gained by travelling through Galbraith on both dedicated and undedicated formed roads maintained by the Council”.[31]
  1. By a letter to the department of 7 April 2015 Inkerman Station’s solicitor submitted of the additional purpose that it would operate to the substantial detriment of Inkerman Station and was wholly inconsistent with the grazing purpose of the lease.[32]  The letter complained that, in breach of its existing lease, HHH had and was continuing to unlawfully operate an ecotourism facility on its leased property under the business name Staaten River Fishing and Wilderness Lodge, providing cabins, camping facilities, boating and fishing to paying customers.[33]  The letter requested additional information and an extension of time.
  2. Those requests were only met in part and, by letter dated 19 May 2015, Inkerman Station’s solicitor forwarded a substantive submission to the department.[34]  Much of the submission was directed to the illegality of the tourism enterprise already developed and being undertaken on Dinah Island and its impact upon Inkerman Station.  More pertinently to the present question, the submission highlighted the nature of the tourism enterprise, by quoting at length from HHH’s website promotion of “Staten River Fishing at Dinah Island”, including:

“’Dinah Island is situated on an inland island which is formed by the North and South arms of the Staaten River and only a 15 minute run by boat to the coast.  The accommodation is set against the backdrop of a large lily-clad billabong and the spacious cabins are within 20 metres from the water and nestled under shady trees.

Where else can you count crocodiles and watch Saratoga and Barramundi feeding when you are having breakfast?

And the fishing is amazing!  If you have ever dreamed of catching a metre-plus saltwater barramundi then you’re at the right place.  Numbers of metre fish caught in the river system is incredible.’

Ecotourism Enterprise offers the following facilities and activities to the public at large:

  • Accommodation
  • Non self-contained room – one (1) person accommodation – one hundred dollars ($100) per night per person;
  • Non self-contained room – three (3) person accommodation – one hundred dollars ($100) per night per person;
  • Communal toilets and showers;
  • Fully furnished self-contained cabins – four (4) person accommodation – one hundred and fifty dollars ($150) per night per person;
  • Fully furnished self-contained cabins – six (6) person accommodation – one hundred and fifty dollars ($150) per night per person;
  • Camping packages for maximum three (3) vehicles and maximum three (3) boats per camp site for $50 per person / per night;
  • Camping locations:
  • Landing Camp 1 (closest to boat ramp);
  • Landing Camp 2;
  • Landing Camp 3;
  • Dinah Lagoon Camp 1;
  • Dinah Lagoon Camp 2;
  • Plane Lagoon Camp 1;
  • Plane Lagoon Camp 2;
  • Crab Point; and
  • Spider Gully.
  • Fishing
  • ‘The Staaten River is a very isolated and private river and it provides the opportunity for our customers to have the chance of catching a metre barramundi.  Every trip experienced, metre plus barra were caught, and there is no other place in Australia that has this type of fishery for Big Salt Water Barramundi.
  • The river itself is a typical Gulf river, with big sweeping corner which hold plenty of structure for casting and trolling.  Casting the snags and creek mouths will keep you entertained all day and trolling the structures for barramundi will soon introduce you to the thrill of big barramundi fishing.
  • In addition to the main river there are also beautiful Billabongs to fish.  These Billabongs hold some great fishing for Barramundi and Saratoga and provide a different fishing experience, making your fishing safari one to remember.’
  • Bird watching
  • ‘More than 300 different species of birds have been recorded on Queensland’s Cape York Peninsula, making it a mecca for bird watchers.
  • The area along the Staaten River is home to a wonderful abundance of birdlife from semi-tropical to temperate species.  And the wonderfully contrasting landscape means that the bird watching possibilities are both numerous and varied.
  • Asiatic waders from as far away as China and Russia are present in the extensive marsh areas on Dinah Island.  They arrive through September, stay in Australia over summer and depart at the end of the wet season in March-April.  Broome and the South-East corner of the Gulf of Carpentaria are the two main entry points for these birds into Australia. …”[35]
    1. The submission for Inkerman Station asserted there were many structural improvements upon the land, erected contrary to the conditions of the existing lease, which confined structural improvements, and to the provisions of the Sustainable Planning Act 2009 (Qld).  These improvements were listed as an aircraft landing facility, boat ramps, numerous accommodation buildings, golf course, camping facilities, additional access tracks over the land, communal buildings, amenities facilities, living quarters and waste and burial pits.[36]  It was submitted the limited purpose of the existing lease and the limited construction allowed by its conditions were a recognition of the land’s unique environmental nature and sensitivity and its inability to sustain further development.[37]
    2. In response to HHH’s receipt of a copy of the above-mentioned submission for Inkerman Station, HHH’s solicitor forwarded a further submission to the department dated 15 June 2015.[38]  It complained Inkerman Station’s had an ulterior commercial motive, namely the purchase of the lease.  It also submitted, inter alia:

“Generally the Inkerman Station material is factually inaccurate, general in nature, and a majority, if not all, of the allegations relating to impact are not supported by any evidence.

…

HHH has been the holder of the lease since 2007.  During this time it has at all times complied with the lease conditions.

HHH has completed the following land management initiatives:-

  1.  Successfully completed a land management assessment by DNRM relating to the condition of the land;
  1.  Entered into a land management agreement relating to the leasehold land;
  1.  Entered into a conservation agreement to declare the area a nature refuge;
  1.  Negotiated and registered an Indigenous Land Use Agreement with the Kowanyama People covering activities and access in relation to the whole of the property;
  1.  Implemented and acquitted nature assist funding relating to a variety of matters including weed and feral animal monitoring and control.

Since purchasing the lease at market value he has demonstrated responsible land stewardship and management during his period of lease ownership.

The land has primarily been used at all times for primary production purposes.  We note that our client lost almost his entire herd of cattle and some infrastructure during the 2013 floods which widely affected the region.  The herd size is slowly being increased.

Prior to the purchase of the lease by HHH, the previous owner established and operated a low impact tourism operation (primarily guided fishing and bird watching) utilising the staff accommodation and other buildings.  HHH did not appreciate that the long standing use did not have all necessary legal approvals in place and that DNRM approval was required for an additional purpose.  This use is currently suspended pending the outcome of this application.

Due to the size of the lease and local conditions, HHH seeks to diversify the primary production activities to include low impact tourism for financial and other reasons.  HHH confirms that it is prepared to negotiate an appropriate code of conduct or activity management agreement for the additional purpose with DNRM.  We note that HHH’s current rules have been provided to DNRM by way of illustration.”[39]

  1. The submission did not specifically indicate to what extent HHH had further developed the tourism enterprise already being conducted at Dinah Island when HHH had acquired the lease.  More significantly, it did not direct express attention to the effect of the additional purpose upon the original purpose.  This was a curious omission, particularly given that by reason of the tourism enterprise already being conducted its effects upon the lease’s original purpose should have been readily identifiable in fact rather than purely a matter of prediction.
  2. In response to Inkerman Station’s receipt of a copy of HHH’s further submission of 15 June 2015, Inkerman Station’s solicitor forwarded a further submission to the department dated 30 June 2015.[40]  That submission explained Inkerman Station’s sole interest in purchasing HHH’s lease was to prevent the ongoing adverse impact to it caused by HHH’s tourism enterprise.  Again, the submission went mainly to the illegality of the tourism enterprise already developed and being undertaken on Dinah Island.  It also included the following:

“Inkerman claims the primary purpose of the use of the land is for a commercial tourism enterprise for financial gain by HHH or related entity.  This is not a difficult fact to prove and should it be necessary to take this matter to a court of competent jurisdiction then the legal process of discovery would indeed prove this to be the case.

…

HHH claim that the land has primarily been used at all times for primary production purposes is inaccurate, misleading, fictitious and false.

Inkerman does not accept this statement and as discussed above, should Inkerman be required to commence proceedings in a court of competent jurisdiction, the process of discovery will prove HHH statement to be false.

…

HHH, by admission in the Affidavit of Mark William McFadyen dated 20 May 2014 (attached) states that:

  • HHH runs only eighty (80) to one hundred (100) head of cattle on Dinah Island as its commercial cattle operation;
  • HHH employs two (2) people on a full time basis who live on Dinah Island;
  • up to thirty five (35) people can be staying on Dinah Island as part of the commercial tourism enterprise; and
  • HHH operates a commercial crab fishing operation with Dinah Island integral to the operations.

Inkerman claims that a commercial cattle operation of eighty (80) to one hundred (100) head cattle would turn off approximately seventeen (17) to twenty (20) head per annum based on Inkerman production statistics.

It is trite to suggest that selling up to twenty (20) head of cattle per annum is a commercial cattle enterprise.

…

The following link provides clear evidence that there are permanent structures on Dinah Island being operated as a commercial ecotourism enterprise.

https://www.youtube.com/watch?v=Jx1MXDg2htM

HHH has never stopped using Dinah Island for a commercial ecotourism enterprise even after the Court Order of Henry J dated 27 May 2014.

…

HHH concedes it needs to diversify, which is not surprising as the net return from the number of cattle being run on Dinah Island would be insufficient to provide a net return on operations.

Dinah Island is simply too small to be of any financial benefit to the holders of the lease.

HHH have not specified the “other reasons” it seeks to diversify the operations on Dinah Island.

Regardless of what terms HHH is prepared to negotiate with DNRM in respect to an appropriate code of conduct the current activities of a commercial ecotourism enterprise on Dinah Island is an illegal activity.  Inkerman holds that the grant of additional purpose to the term lease of an ecotourism enterprise is not consistent with DNRM Policy PUX901/337, as this policy specifically excludes those leases that have a limitation of grazing only, as does TL 0/206937 (Term Lease for Dinah Island).

…

The basis of the Inkerman objection to the application for additional purpose of ecotourism is the adverse impact and detriment to Inkerman caused by the illegal use of Dinah Island by HHH operation of a commercial ecotourism enterprise. …”[41]

  1. In hindsight, it was unfortunate that the submissions of HHH and Inkerman Station focussed so heavily upon the impact of HHH’s past tourism use of the leased property upon Inkerman Station rather than upon the original purpose of HHH’s lease.  This likely diverted attention from the important threshold question of whether the additional purpose was complementary to and would not interfere with the lease’s original purpose.  Had more attention been paid to that question it is conceivable that HHH would have better addressed the effect of its tourism enterprise upon its use of the lease for grazing.  It might also have supported its position by raising and acquiescing to the potential imposition of conditions to ensure that the tourism purpose would remain a “low impact” or “low key” purpose so as not to interfere with the grazing purpose. 
  2. The affidavit of Mr McFadyen, attached to Inkerman Station’s submission of 30 June 2015, sworn on 20 May 2014, was obviously directed to establishing the need for continued vehicular access to Dinah Island via Inkerman Station.  However, some parts of it were of potential relevance to the present issue:

“Cattle grazing on Dinah Island

  1.  The Applicant runs about 80 to 100 head of cattle on Dinah Island.  In order to conduct a commercial cattle operation on Dinah Island, the Applicant needs to be able to enter in and out of Dinah Island.  I refer to the following activities in particular requiring the Applicant to have continued access by road to and from Dinah Island.
  1.  Every couple of months either an employee of the Applicant or myself, deliver lick to Dinah Island to supplement the cattle’s diet.
  1.  I will be conducting a muster of the cattle on Dinah Island within the next 1 to 2 months.  The purpose of the muster will be to remove weaner calves from their mother cows, in order to keep the cows in optimum condition for further breeding.  This muster needs to be repeated once or twice each year.
  1.  I am planning on introducing a further approximately 300 head of cattle to Dinah Island in about the next 2 to 3 months.
  1.  I hope to start selling cattle grazing on Dinah Island within about the next 2 to 3 months. …

Eco Lodge

  1.  The Applicant operates a commercial eco lodge on Dinah Island and has done so in one form or another for about the last 4 years.
  1.  Dinah Island is closed to guests during the wet season.  It reopened this week.  There are currently 7 guests staying on Dinah Island, with a further 22 or so booked to arrive this week.  There can be up to 35 guests on Dinah Island (up to 15 camping and 20 staying in cabins) at any one time. …
  1.  The guests of Dinah Island visit there to fish and enjoy a short term camping and wilderness style holiday.  There a [sic] very limited provisions and supplies held on Dinah Island and guests are required to bring their own with them.  Most of the guests who go fishing on the Staaten River bring dinghies about 4 metres in length. …
  1.  The Applicant’s employee who lives on Dinah Island is also responsible for taking care of the guests, the Lodges and other guest facilities.”[42]
  1. By letter dated 9 July 2013 HHH’s solicitors responded to the latest submission for Inkerman Station, noting it relied on its earlier submissions and highlighting a number of matters.  They included:

“(a) The historical use of the property for low key tourism was suspended in 2013 pending a decision in relation to this application.  Use of the property for grazing purposes continues.

  1.  Harvest Home Holdings has sought approval of an additional purpose (low key tourism).  The conduct of an additional low key tourism purpose will not contravene the lease purpose or conditions if approved by DNRM.
  1.  The approval of the additional purpose (low key tourism) will not result in a significant change to the historical operations and is complementary to the current purpose of grazing.
  1.  The suggestion that residential occupation for purposes associated with the grazing lease and any additional purposes is not permitted is ridiculous given the purpose of the lease and distances from rural centres in the region, namely Kowanyama, Normanton and Chillagoe.
  1.  All current fixtures on Dinah Island existed when the lease was acquired by Harvest Home Holdings and has been the subject of numerous property inspections by officers of DNRM as part of its overall land administration and management function.
  1.  Harvest Home Holdings has demonstrated appropriate and responsible land stewardship during its occupation of the land since 2007 and this will continue into the future.”[43] (emphasis added).
  1. The bare assertion in point (c) above that the additional purpose was complementary to the original purpose was unsupported by any information to found the assertion.  There was no explanation of how the tourism purpose was said to be complementary to the grazing purpose.
  2. Inkerman Station’s solicitors responded with a further submission on 14 July 2015.  It added no additional information of present relevance.
  3. HHH’s solicitors responded in turn by letter to the department dated 20 July 2015.  Further to the by now tit for tat reiteration of arguments it also contained the following:

“(a) Low Impact Tourism

Harvest Home Holdings Pty Ltd (“HHH”) operated a low impact tourism camping ground during the 2014 dry season.  This use ceased in November 2014 and has not been undertaken since this time.  2014 was the first year that Dinah Island had operated the tourism operation as a camping facility.  Previous to this time, HHH operated the guided fishing charters on a fly-in fly-out basis for clients.

  1.  Improvements

We previously advised that HHH had not undertaken any improvements since becoming the registered Lessee of Dinah Island.  HHH has clarified that since becoming the registered Lessee, HHH has upgraded and improved the existing cattle yards adjacent to the homestead/accommodation area.  The machinery and storage shed was pre-existing.  The registered Lessee has also undertaken some limited renovations to extend the accommodation for personal and family use.

The proposed additional purpose of low key tourism will only use approximately 25% of the buildings and structures on the property.

  1.  Current Cattle Herd

The approximate number of cattle which is present on the property is about 110 head.  As previously indicated, the 2012 flood completely wiped out the cattle herd and HHH has been building the herd up progressively.  We understand that HHH will be purchasing additional cattle to accelerate the regeneration of the herd.  We have been instructed that prior to the 2013 flood, HHH held approximately 450 breeding cows and the total herd size, including progeny, at any one time was approximately 700 head of cattle.  HHH hopes to return to this herd size as soon as possible.  During the period of regeneration of the cattle herd, HHH are also undertaking fencing work to improve fencing and also repair damaged fencing.

In terms of primary use, we consider that in the event that the additional purpose was approved by DNRM, the primary purpose of the Lease would remain “grazing” given the limited area which would be used for the tourism purposes (accommodation, access tracks and boat launching area).  The grazing use would remain the primary source of income for the property and not the low key tourism use.  In terms of temporal use the period of use of the low key tourism will be May to end October.  Approximately 5-6 months of the year as opposed to grazing which will be 12 months per annum.

In response to the most recent submissions made by the solicitors for Inkerman, we respond as follows: …

  1.  We reiterate that the approval of the additional purpose (low key tourism) will not result in a significant change to the historical operations and is complementary to the current purpose of grazing. …
  1.  HHH reiterates that the proposed code of conduct can be the subject of discussions and agreement with DNRM and can be implemented by way of a condition of the lease.

Cattle grazing is and will continue to be the main purpose of use.  The proposal is consistent with general policy and efforts to assist primary producers in various ways involving diversification of income and use.  For the Departments information, HHH recently concluded mustering operations which confirmed a current herd size of approximately 110 cattle.”[44]

  1. By letter of 2 February 2016 the department’s regional manager, the eventual decision-maker Mr Allan, wrote to the solicitors for HHH and Inkerman Station, indicating he had formed a preliminary view in favour of the application:

“I have formed the preliminary view that the current Lease purpose, namely Primary Industry (Grazing), is a lease purpose which the decision maker can consider for diversification despite inconsistency with the guidance provided by the Department of Natural Resources and Mines (DNRM) Policy PUX/901/337.  Specifically, I have formed the preliminary view that the ‘seasonal’ use of part of the property for low key tourism is secondary to primary industry (grazing).  I consider I should give weight to the applicant’s intended seasonal (only) use of the property for low key tourism purposes and the potential enhanced economic stability of the property if the additional purpose is added given the significant weather events that affect the property.  I am inclined to be satisfied that development on the property, though it currently exceeds the guidance of the abovementioned Policy, is still within the diversification principles.”[45]

  1. The letter invited submissions.  The response of Inkerman Station’s solicitors, dated 16 February 2016, mainly involved unproductive criticism of the department and strident reiteration of past themes.  It also took issue with the giving of weight to a diversification policy:

“DNRM Policy PUX/901/337 (DNRM Policy Diversification)

Correspondence dated 2 February 2016 DNRM refers to an inconsistency with the DNRM Policy Diversification. …

Inkerman rejects absolutely the above contention.

The DNRM Policy Diversification specifically excludes diversification where it applies to lease purposes that are “grazing” only.  There is no scope for an interpretation of the DNRM Policy Diversification.  The wording of the DNRM Policy Diversification is clear and unambiguous:

The types of Leases not covered by the guideline:

  • Leases conditioned to limit use to grazing “only”

A decision based on such inconsistency, such as a total exclusion of relevance to a policy is ultra vires and will be strongly opposed by Inkerman.”[46]

  1. Inkerman Station’s solicitors forwarded a further submission dated 1 March 2016.  It raised the following presently relevant information:

“Seasonal Use

DNRM correspondence under reference dated 2 February 2016 refers to seasonal use of Dinah for low key tourism.

Clearly DNRM are not cognisant of the necessities of running a cattle grazing operation in the Western Gulf of Carpentaria.

From November until approximately May the following year very little happens on cattle grazing operations due to the heat and the wet season.  Graziers scale back operations and devote their time to equipment maintenance and having a break.

Once the wet season commences the only mode of transport is by water or air.  Very little happens on the land until property access tracks dry out and become trafficable.

The seasonal use DNRM refers to, is low key tourism being the same season which must be devoted to running a cattle grazing operations, should in fact one exist.  The only period of the year to run a tourism operation in the western Gulf of Carpentaria is the same period required to run cattle grazing operation.

There is no possibility the use is complementary.  There is direct conflict.”[47]

  1. Solicitors for HHH responded with a letter to the department of 2 March 2016, reiterating its position.  It asserted “the diversification principle can be applied in the current circumstances regardless as to whether the formal DNRM policy regarding diversification PUX/901/337 applies”.[48]
  2. Inkerman Station’s solicitors responded with further argument but no new information on 4 March 2016.[49]

Information from the department

  1. Mr Allan received a submission from his department which reviewed but did not introduce new factual information.  It alluded to policy PUX/901/337 “Diversification of Leases for Agricultural Purposes” as not applying but providing useful guidance.  It also alluded to policy PUX/901/333 “Additional Purposes of Leases” as not providing guidelines in relation to agricultural leases but providing “guidance in relation to s 154”.  In fact, as explained above, that policy does apply but nothing turns on the point.  The theme developed in the submission, deriving guidance from those policies, was that the additional purpose should not result in significant change or in the additional purpose becoming a dominant rather than lesser purpose.  For reasons already discussed, such considerations are potentially relevant to the exercise of the discretion but do not inform the jurisdictional question of fact.

The decision

  1. By letter dated 26 April 2016 to HHH’s solicitors, the decision-maker announced the approval of the application, writing:

“As delegate under Land Act Ministerial Delegation 2015 I have approved Harvest Home Holdings’ application to add an additional purpose under section 154 of the Act and I have approved changing the lease conditions under section 210 of the Act subject to the following conditions of this offer being met within six months of the date of this letter:

  1.  Harvest Home Holdings adequately addressing native title for the additional purpose and the change to the current lease condition to include ‘low key tourism’; and
  1.  Harvest Home Holdings providing written evidence from the local authority that it is satisfied:
  1.  Harvest Home Holdings has obtained any necessary approvals under the Sustainable Planning Act 2009 for buildings used for low key tourism activities; and
  1.  in relation to steps that Harvest Home Holdings has taken to address the issues referred to in its letters dated 21 May 2012 and 25 June 2013 about developing a mandatory evacuation plan and evidence of training of staff and/or visitors who may be at the site over any period of the wet season. …”[50]
  1. The letter contained an annexure, again itemising the above conditions, describing them as offer requirements.  The annexure stated that subject to compliance to compliance with those requirements, “approval will be given to the purpose of low key tourism being added” to the lease.  Nothing was made in argument of the point that the short title of the conditionally approved purpose, “low key tourism”, is slightly different from the short title of the purpose applied for, “low impact tourism”.
  2. It is noteworthy that while the offer contained conditions to be complied with before the final giving of the approval for the purpose of low key tourism being added to the lease, there was no reference to the imposition of any conditions relating to the scale of the additional purpose or its interaction with or effect upon the original purpose.

Decision-maker’s statement of reasons

  1. The decision-maker’s statement of reasons included the following:

“Is the additional purpose of the low key tourism complementary to the purpose of grazing?

  1.  An application for an additional purpose may only be approved if the additional purpose is complementary to, and does not interfere with, the purpose for which the lease was originally issued (s. 154(2)(a) of the Act).
  1.  The policy PUX/901/337 – Diversification of Leases for Agricultural purposes v2.04 (PUX/901/337) was originally developed in 2004 to provide a practice guideline to guide both applicants and decision makers on diversification.
  1.  Although PUX/901/337 states that it does not apply to leases conditioned to limit land use to grazing “only” I have found it to provide useful guidance in this case when assessing whether a particular low key tourism activity proposed is complementary to, and does not interfere with, the existing use of grazing.
  1.  PUX/901/337 states that “[w]hen considering applications by lessees to use agricultural leases for additional purposes a proposed activity may be considered to be complementary even if it is not related to agriculture, if the activity contributes to the viability and ecological sustainability of the enterprise, and allows the activity of agriculture to flourish where otherwise it may not have.  For this to occur, the activity must be of sufficiently small scale to ensure that it does not become the dominant or principal activity”.
  1.  PUX/901/337 confirms that diversification on agricultural leases can be supported if the nature of the diversification is small in scale and the nature of the activities would not require the rental category to be changed. …
  1.  I have found that the low key tourism activities proposed are small in scale, in relation to the size of the lease land, the times of operation and the facilities used to support the activities.  I have found that the addition of low key tourism to the lease purpose would not require the rental category to be changed.
  1.  Tourism activities of the nature proposed by HHH are seasonal in North Queensland and as such will not be the dominant use of the lease land, where grazing will be undertaken year-round.  The reduction in the number of cattle on the lease is stated by HHH to be a result of weather events, rather than the low key tourism activities.
  1.  I have found that low key tourism activities have previously been operating on the lease land.  HHH has advised that its experience has been that the activities of grazing and low key tourism activities complement each other. …
  1.  PUX/901/337 guides decision makers to consider existing improvements that can be used, for the activities that are the subject of the applications, allow for the establishment of limited improvements.  HHH has advised that when it purchased the lease there were already 5 demountable dwellings, a care taker’s residence and the owner’s residence located on the lease land.  HHH does not propose to add to the structures on the lease land.  I have found the development only minor in relation to balance of the property used for grazing. …
  1.  Departmental policy PUX/901/333 – Additional purposes of leases (PUX/901/333) was developed in 1997, as a guideline for when a lease may be used for an additional purpose.  This policy does not provide guidelines in relation to agricultural leases and the guidelines suggest that approvals relating to the erection of dwellings relating to the conduct of the business of grazing should only be approved in certain circumstances.  Again, PUX/901/333 provides guidance in relation to s.154 as it states that “[a]n additional purpose should not result in a significant change i.e. to a “lesser” purpose or an upgrade of the lease”.
  1.  Although the current application does not fall squarely within either of the policies, I have placed weight on the fact that there are already improvements established on the lease land for the purposes of low key tourism and that that activity has been carried out previously on the land by the former lessee and by HHH without affecting the grazing operations (which continue to date).
  1.  I have found that the eco-tourism type activities are contemporary low key tourism activities which, although not related to grazing, I have found to contribute to the viability and economic stability of the leasehold land.  For example, I note that HHH has advised that almost an entire herd of cattle was lost during the 2013 floods and I have found that diversification to enable low impact tourism will assist in ensuring a viable operation where grazing may continue to flourish.
  1.  I am satisfied that, given the remoteness and size of the lease, and the fact that the low key tourism activities will be operated seasonally, those activities will remain secondary to the primary purpose of grazing.
  1.  I have therefore found that the low key tourism activities are complementary to the primary purpose of grazing.

Does the additional purpose of low key tourism interfere with the purpose of grazing?

  1.  I have considered details of the number of cattle run on the lease land as at May 2014 which was referred to in the affidavit of HHH’s director Mark McFadyen dated 20 May 2014 (attached to Emanate Legal’s letter dated 14 July 2015).  I have also considered Preston Law’s letter of 20 July 2015 which advises that HHH intends to build up the herd.
  1.  I am satisfied that the number of cattle on the property has been affected by weather events outside of HHH’s control rather than the previous operation of the low key tourism activities.
  1.  I recognise that in far north Queensland, tourism is a highly seasonal industry and that while grazing activities occur year round, tourism activities do not occur in the wet season.
  1.  As stated I have found that the activities are complementary and I have also found that the low key tourism activities proposed will not interfere with grazing activities.

Is the addition of the purpose of low key tourism consistent with the objects of the Act?

  1.  Section 4 of the Act provides that the land administered under the Act must be managed for the benefit of the people of Queensland by having regard to the principles of sustainability, evaluation, development, community purpose, protection, consultation and administration.
  1.  I have considered these principles when making my decision.  I have found that the lease land is currently allocated for primary industry (grazing) purposes.  The past, current and intended future use of the lease land by the lessee is considered to be a sustainable use.  In considering whether the development facilitates the economic, social and physical well-being of the people of Queensland, I have found that the community’s desire to be able to access unique features of Queensland located in the lease land would be supported by approving the application.  I have found that the development on the property is low scale and I have imposed conditions to address the fact that it has been asserted that parts of the existing development are not authorised.  I have found that the lease land has not been identified as being required for a community purpose.
  1.  I have also found that the lease land has environmentally valuable and sensitive areas.  I am satisfied that the environmental and any sensitive areas and features would continue to be protected under the current lease (where the land has nature refuge status) upon the addition of an additional purpose to the lease. …

REASONS FOR DECISION

  1.  I have decided to approve, based on the above findings, the application to add an additional purpose under s.154 of the Act and I have approved changing the lease conditions under s.210 of the Act (see attached proposed conditions) subject to HHH meeting the following conditions by 26 October 2016:

i. HHH adequately addressing native title for the additional purpose and the change to the current lease condition to include ‘low key tourism’;

ii. HHH providing written evidence from the local authority that it is satisfied:

  1. HHH has obtained any necessary approvals under SPA for buildings used for low key tourism activities; and
  2. In relation to steps that HHH has taken to address the issues referred to in its letters dated 21 May 2012 and 25 June 2013 about developing a mandatory evacuation plan and evidence of training staff and/or visitors who may be at the site over any period of the wet season.
  1.  The reasons for my decision are:
  1.  I have concluded that the additional purpose of low key tourism in relation to the lease is complementary to the grazing purposes for which the lease was originally issued;
  1.  I have concluded that the additional purpose does not interfere with the purpose for which the lease was originally issued; and
  1.  I have concluded that the addition of the additional purpose is consistent with the objects of the Act.” (emphasis added)
  1. The passage emphasised in paragraph 30 highlights reliance was placed upon HHH’s bland assertion that the additional purpose had previously complemented the original purpose.  To the extent that the reasons actually identified how the additional purpose had been or would be complementary to the original purpose it is in paragraph 37 above, namely that diversification will assist in “ensuring a viable operation where grazing may continue to flourish”.  That it would, or how it would, ensure that outcome is not apparent from the application or the additional information provided in support of it.
  2. By implication from the reasons the positive effect upon the original purpose was perceived by the decision-maker to be economic, namely that the additional purpose would sustain the continuing original purpose of grazing, for instance in financially supporting a return to the effective use of the land for grazing after calamitous events such as the 2012 flood.  I have already concluded that on the face of it, such an effect would be a positive material effect upon the original purpose, making the additional purpose complementary to the original purpose.  However, despite the volume of information placed before the decision-maker, there was no focus in it on how the additional purpose would provide financial support to sustain the original purpose.  As will be seen, the additional evidence was unhelpful to HHH in that it showed the additional purpose does not have such an effect in the case at hand.
  3. Paragraphs 29 and 41 of the reasons directed attention to the fact that the extraordinary decline in cattle numbers on Dinah Island had been caused by the flood rather than the tourism enterprise.  No attention was given to the extent to which the priority subsequently given to the tourism enterprise by HHH had delayed or diverted potential funding in support of the recovery of the grazing enterprise.  It was the subject of attention in the additional evidence adduced before me.

The additional evidence

  1. Much of the evidence filed in the application included information of a kind which was before the decision-maker, including the impact of HHH’s past tourism enterprise upon Inkerman Station.  It is unnecessary to further review such evidence.  The evidence which was additional to the limited evidence before the decision-maker on the topic of whether the additional purpose is complementary to and does not interfere with the original purpose, derived mainly from the evidence of Mr McFadyen of HHH and from HHH’s financial records.  Some miscellaneous evidence about the nature and extent of the tourism enterprise conducted in the past on Dinah Island, such as photographs and other information from YouTube, Facebook and relevant websites, was also filed.
  2. While an affidavit of Mr McFadyen was filed, it did not provide any evidence as to how the additional purpose is complementary to and does not interfere with the purpose for the lease’s original purpose.  It was not until he gave oral evidence that this issue was expressly addressed.  He was an unconvincing witness, particularly when pressed about the significance of HHH’s expenditure on tourism as compared to grazing.
  3. Mr McFadyen acknowledged in evidence that he was an experienced cattleman, having had cattle properties at Malanda, Julatten and up near Cooktown.[51]  He also acknowledged that he had inherited many millions of dollars from his parents.[52]
  4. Mr McFadyen was taken to a marketing document relating to the time of HHH’s acquisition of the Dinah Island lease on 7 December 2006.[53]  He agreed of that document’s reference to the property having a carrying capacity of “500 head” that he understood it to mean 500 adult equivalent cattle.[54]  He explained the inclusion of calves and weaners would involve a higher number, saying, “I have close to 450 breeders and the calves and weaners, so, yes, there was over 500.  I had, yes, way over 500 head there.”[55]  Mr McFadyen later testified that if weaners and calves were included, the carrying capacity of Dinah Island could be up to 750 head.[56]
  5. Mr McFadyen was taken to records from the National Livestock Identification System which showed that between 1 January 2011 and 26 April 2016 no livestock was moved onto Dinah Island.[57]  Mr McFadyen explained, “That’s because of the flood”, a reference to a flood event in 2012 in which 80 per cent of the Dinah Island herd was lost.[58]  He acknowledged that on 16 August 2011 250 head of cattle from Dinah Island had been sold.[59]  He explained no cattle had been moved off Dinah Island or sold since that flood.[60]
  6. The flood occurred in about March of 2012.  By 1 July 2012 HHH’s total cattle stock was all on Dinah Island and was only 80.[61]
  7. According to HHH’s financial reports, the stock number was still said to be 80 as at 1 July 2013 and the closing stock at the financial year ending 30 June 2014 was said to be 86 by reason of a natural increase of eight, less two cattle deaths.[62]  By 30 June 2015 the livestock trading statement of HHH for the year ended 30 June 2015 recorded a natural increase of 29, less five cattle deaths, resulting in an increase from 86 to 110.[63]  That record appeared to represent that the 110 stock had been transferred so that there was in fact no closing stock, but Mr McFadyen suggested that was a mistake.[64]  As much seems likely in that the livestock trading statement for the year ended 30 June 2016 recorded a closing stock starting figure of 110.  It recorded there had been a natural increase of 25 and a decrease of five due to death, and recorded the closing stock as 130.[65]  Mr McFadyen did not dispute the accuracy of that figure. 
  8. He explained there had been an element of estimation in regard to stock numbers in that the flood had been in 2012 and he did not do a muster until 2014, and then did not do another muster until 2016.[66]  In any event, as at 30 June 2016 which was the most current information placed before the court, Mr McFadyen conceded Dinah Island was operating at less than one-fifth of its carrying capacity.[67]  He explained he, inferentially HHH, could not afford to buy cattle, blaming its financial difficulty on the effects of the flood and the cost of his legal disputes with Inkerman Station.[68]
  9. Mr McFadyen readily acknowledged HHH had operated a tourism enterprise on Dinah Island, explaining that when the tourism enterprise was underway it conducted guided fishing tours, charging $1,000 per day.[69]  He explained guides would drive customers over various parts of the island to billabongs and the river boat ramp.[70] 
  10. It was made apparent from HHH’s financial records that it set about expending money on the conduct of a tourism enterprise on Dinah Island from an early stage.  For instance, in late 2006 and early 2007 $5,000 was expended on a Barra Boat and $11,675 was expended on a boat motor,[71] in 2008 DVD players were acquired “for guests”[72] and in the latter half of 2009 tens of thousands of dollars were expended in connection with “Building improvements (Luxury Accommodation Units)”.[73]  While obviously reluctant to concede land vehicles referred to in the depreciation schedule were used for driving tourists to go to fishing locations,[74] tens of thousands of dollars were expended in 2010 and 2011 in connection with vessels.[75]  Mr McFadyen struggled to identify much significant expenditure in relation to cattle amidst HHH’s accounting depreciation schedules in the pre-2012 era.[76] 
  11. In HHH’s depreciation schedule to 30 June 2012 there was recorded on 26 April 2012, acquisitions of many chairs and mattresses obviously destined for use by tourists.[77]  The schedule for the next financial year to 30 June 2013 was littered with entries totalling tens of thousands of dollars on obviously tourism related items.[78]  Such expenditure was well after the March 2012 flood.  HHH’s profit and loss statement for the year ended 30 June 2013, the first full year after the flood, recorded gross profit for trading in obvious connection with “fishing packages” to be $427,013 in 2012 and $474,234 in 2013.[79]  Conversely it recorded no apparent income in connection with grazing at Dinah Island.
  12. Evidence of this kind supported the obvious conclusion that the tourism enterprise had continued to grow in importance beyond the flood event.  Mr McFadyen’s reluctance to accept as much was not credible.[80] 
  13. Subsequent years’ profit and loss statements showed a reduction in the gross profit for trading in connection with tourism but no apparent income in connection with grazing at Dinah Island.[81]
  14. When the point was made to Mr McFadyen that no expenditure had been invested in re-building the grazing enterprise on Dinah Island but plenty had been expended on tourism beyond the era of the flood he testified that the tourism business had not been profitable and funds directed to it were from his “personal money”.[82]  This point was further pursued:

“Mr McFadyen, you have steadily reduced the holdings – the cattle holdings of the trust since 2010 to a point where it reached something in the order of 80, and you never sought to build it up?‑‑‑That’s because of the flood.  You know very well it was because of the flood and selling properties. …

The flood was four years before the decision in respect of this application.  Wasn’t it?  Four years?‑‑‑Yes; it takes a while to build the herd up…

HIS HONOUR: Can you help me with why, if you spent so much money on the tourism side of things, you didn’t spend some money buying stock?‑‑‑Well, I was saying – because cattle take a while to turn over; by the time you buy them in – they get in calf, have the calf and graze up, and I probably made a mistake.  I thought if the tourism would have generated money to – and I could have bought cattle, but the three years I did the upmarket it basically did not work.  I was actually trying to sail two boats.  I was – I thought it would work.  It didn’t work.  It will work in the future, but then went to the drive-ins.  The drive-in tourists weren’t much work, and they worked – that worked in very good, and that is the best – yes, the best way, and if I could have kept doing the drive-ins I would have been – and without solicitor bills, I would – yes, I would have been fully stocked by now.

How?  By buying more cattle?‑‑‑Yes. …

MR TRAVES:  The borrowings that you made of 400,000 – you say the funds for the $400,000 investment or thereabouts in the tourism business came not from the tourism business itself but from elsewhere?‑‑‑I’d have to look.  The tourists – the three years of the fly-in tourists did not make money by the time – and if it shows there’s money – if you’re talking about 400,000, that must have come from not – it wasn’t from profits.

All right.  So it came from somewhere else?‑‑‑Otherwise I would have kept doing the fly-in tourists. …

But you didn’t invest in cattle.  Instead you invested in your tourist business?‑‑‑Well, maybe I made a mistake.  Maybe I should have---

Is that correct, Mr McFadyen?  Did you not – it’s correct you made a choice not to buy cattle; you made a choice to develop the tourism.  That’s correct, is it not?‑‑‑I thought that was the best way--- …

Is it correct that you made the choice?  You had a choice, and you elected to put your money into the tourism business?‑‑‑Well, I thought that was the best way to go at the time.”[83]

  1. Mr McFadyen was reminded of his affidavit of 20 May 2014 in which he had deposed, “I’m planning on introducing a further approximately 300 head of cattle to Dinah Island in about the next two to three months”.[84]  Mr McFadyen conceded, under cross-examination by counsel for Inkerman Station, he did not do what he had deposed he was planning to do.[85]  He did not provide a convincing answer as to why he had not done as he deposed he was planning to do.[86] 
  2. He later testified when questioned by counsel for the decision-maker that the cost of his legal dispute with Inkerman Station and of a family law dispute had a lot to do with him not restocking as he deposed he would.[87]  Mr McFadyen also explained that, because of a custody dispute, it had only been in the last 18 months that he had been able to live on Dinah Island and be in a position to give proper attention to the business.[88] 
  3. He was asked what he is planning to do in respect of his grazing operation on Dinah Island, assuming the application for an additional purpose has continued success and HHH’s compliance with conditions.  He responded:

“Depends on the income, I would be buying and increasing the herd up to fully stocked as quickly as I – I can.

When you say fully stocked, what sort of number are we talking about?‑‑‑Well, basically around, I suppose if you talk adult equivalent, the 550 or 600 a head.

And over what sort of period of time do you think that that is achievable?‑‑‑Yeah. Cattle are very expensive to buy at the moment.  The – I’d prefer to buy heifers in calf or cows in calf.  You – by the time you get them they’re probably looking at thirteen hundred to fifteen hundred dollars per head. … And timewise, it just – it depends on the – I … guess with – I could probably be fully – fully stocked within two years.”[89]

  1. In re-examination Mr McFadyen explained that the apparently hundreds of thousands of dollars he had invested in the tourism enterprise had come from his own personal money.[90]
  2. Unhelpfully to Mr McFadyen’s credibility as an operator respectful of the law’s requirements he conceded he had ignored the court’s order of May 2014, continuing to permit tourist clients to travel to Dinah Island through Inkerman Station.[91]
  3. Under cross-examination by counsel for the decision-maker Mr Fadyen advanced what were obviously intended to be framed as six complementary effects of the tourism enterprise upon grazing, namely:
  1. tourists can spot and report sick, injured or bogged cattle or downed fences (“the spotters’ benefit effect”);
  2. exposure to people, that is, tourists, moving about the property will render cattle less shy of people and thus easier to muster (“the less shy cattle effect”);
  3. the presence of extra people, that is, tourists, about makes life on the cattle property safer in the sense of people being about in the case of an emergency (“the safety in numbers effect”);
  4. being able to have contact and socialise with people, that is, tourists, is good for the mental health of people operating a remote cattle property (“the mental well-being effect”);
  5. being able to use money made by the tourism enterprise to support and improve the grazing enterprise (“the financial support effect”);
  6. having another livelihood when the grazing enterprise is impacted by natural disaster (“the alternative livelihood in hard times effect”)[92]

Discussion

  1. Of the above mentioned six effects it is only the financial support effect which requires closer scrutiny.  The articulation of the spotters’ benefit effect, the less shy cattle effect, the safety in numbers effect and the mental well-being effect obviously involved an exercise in imagination in conjuring up inconsequential or trivial effects of a kind referred to earlier in these reasons.  They do not satisfy the qualifying requirement of materiality identified earlier.  That is, they are of insufficient substance to render the additional purpose complementary to the original purpose in the sense required by s 154(2)(a).
  2. As to the alternative livelihood in hard times effect, it is not an effect upon the grazing purpose.  It is an effect which may very well be relevant to the exercise of the discretion in s 154(1) but merely providing an alternative income stream to a lessee is not of itself a quality which is complementary to the grazing purpose. However if income thereby raised is to be applied to support the grazing purpose then it may have that quality.  This heralds the financial support effect as the only effect of potential substance in this case.
  3. I have already found an additional purpose that generates funds which will be applied to sustain an original purpose would have a positive material effect upon the original purpose, making the additional purpose complementary to the original purpose.  However, I do not accept that, on the presently available information, the additional purpose would generate funds which would be applied to sustain the original purpose.  It follows the additional purpose cannot be said to be complementary to the original purpose. 
  4. The additional evidence demonstrated HHH has in truth been using only a fraction of the leased land’s capacity for grazing since at least the 2012 flood, if not since a significant sale of cattle in 2011.  Since the flood the herd has barely been increased beyond one fifth of the land’s capacity to support the lease’s original purpose.  Since that era no significant expenditure appears to have been invested in grazing, particularly in acquiring more cattle.
  5. Conversely significant money was expended on the tourism enterprise even after the 2012 flood.  It was argued that was not to the point in that it was Mr McFadyen’s personal funds which were used.  The argument is illusory.  It is quite plain Mr McFadyen is the controlling mind of HHH.  HHH under the controlling mind of Mr McFadyen made a choice to apply funds made available to it to the tourism enterprise and not to the restoration of cattle numbers.
  6. Mr McFadden’s evidence of HHH’s future intention was not credible in light of the prolonged period of near dormancy in grazing recovery.  It was highlighted that he has had significant other financial obligations and that recovery from natural disaster does not occur quickly.  However the period of inaction in re-establishing significant cattle numbers has been very long.  It demonstrates a clear preference against the allocation of funds to substantially restore cattle numbers. 
  7. Mr McFadyen’s claims of future intention were also unconvincing given he in 2014 deposed to an intention to increase the herd by 300 within two or three months but HHH did not acquire and introduce such additional cattle, not even to some lesser extent than foreshadowed.  Even if Mr McFadyen’s or HHH’s other looming financial demands were onerous I do not accept they were so unpredictable that he was unaware of them in choosing to so depose.  The impression he is willing to promise authorities one thing and do another is also consistent with HHH’s conduct after the Court’s order in 2014 regarding travel to Dinah Island through Inkerman Station.
  8. It ought be appreciated that an applicant in the position of HHH is not necessarily doomed to forever fail in pursuit of applications of this kind or that an application of this kind is the only option for pursuing tourism as a lease purpose.  As to the latter point, there could be an excision of the lease and issue of a term lease over that part, a conversion of the lease to freehold tenure or the issue of a new lease for the new lease purpose.  As to the former point, some further analysis is appropriate.
  9. In some s 154 applications the nature of the additional purpose may be intrinsically complementary to the original purpose.  In such cases the additional purpose will likely be related or connected to the original purpose.  For example, an additional purpose which involves training or education in skills applied in pursuit of the original purpose is likely, though not inevitably so, to be complementary to the original purpose.
  10. However, it cannot be said that tourism is intrinsically complementary to grazing.  They are not on the face of it inherently related or connected purposes.  That is not to say, depending on what is proposed by an applicant, that an additional purpose of tourism cannot be complementary to an original purpose of grazing.  Where it is said to be complementary by reason that it will generate funds which will be applied to sustain the original purpose of grazing it will not have that quality in an intrinsic sense.  Rather that quality, if present, will derive from the detail of what is, on the true facts, proposed to be done. 
  11. It is difficult to see how an application relying upon an additional purpose supposedly having a complementary effect of that kind could succeed in the absence of at least some persuasive detail as to how that effect will be achieved.  Here there was never any or any reliable detail advanced in support of the fact that or way in which the additional purpose would generate funds for potential use in sustaining the original purpose or the fact that or way in which those funds would be applied so as to sustain the original purpose.  Nor were any conditions proposed in advancing the application such that the applicant defined, confined or framed the additional purpose as one with that specific future effect, an effect of pivotal importance to the existence of the jurisdictional fact. 
  12. Unhelpfully to HHH this left its past patterns of conduct of the tourism enterprise and grazing operation as the best indicator of whether the proposed additional purpose was complementary to and would not interfere with the original purpose.  That indicator was unhelpful because those patterns positively suggested a reticence to apply funds to sustain the lease’s original purpose, which has for a prolonged period been in need of restorative financial support.
  13. I am satisfied on the true facts of the present case that the additional purpose applied for is not a purpose which is complementary to the lease’s original purpose. 

Conclusion

  1. It follows I am satisfied that the threshold jurisdictional fact required before the discretion to approve the application arose never existed. 
  2. It was submitted by the fourth respondent that even if I so concluded I ought to exercise my discretion not to intervene.  I do not accept that is an appropriate course here.  As earlier explained s 154 confers a significant advantage on a lessee, allowing the lessee to potentially avoid the Act’s publicly competitive regime if the threshold requirement of jurisdictional fact is met.  No reason has been advanced as to why in this instance that advantage ought be conferred upon the fourth respondent even though the threshold requirement imposed by the legislature has not been met.  The proper outcome is that the decision of 26 April 2016 to conditionally approve the application dated 2 March 2012 should be set aside.
  3. It will be necessary to hear the parties, in the absence of consent orders, as to whether further orders are required and as to costs.

Orders

  1. My orders are:
  1. The decision of 26 April 2016 to conditionally approve the fourth respondent’s application dated 2 March 2012 for approval that its rolling term lease be used for an additional purpose is set aside.
  2. I will hear the parties as to whether further orders are required and as to costs at 10am on Tuesday 7 November 2017 (out of town parties have leave to appear via telephone) unless they agree on consent orders in respect of those matters in the meantime.

Footnotes

[1]  It is common ground that the relevant reprint of the Act was a reprint current at 1 January 2015 and references to the Act in these reasons are references to that reprint of the Act.

[2]  See reasons delivered at the outset of day 2 of the hearing: Inkerman Station Pty Ltd as Trustee for the Inkerman Station Trust v Allan & Ors [2017] QSC 147.

[3] Timbarra Protection Coalition Inc v Ross Mining (1999) 46 NSWLR 55, 63; Enfield City v Devt Assess Cmmn (2000) 199 CLR 135, 151, 155; Woolworths Ltd v Pallas Newco (2004) 61 NSWLR 707, 724, 729-730.

[4]  Affidavit of Kev Allan filed doc 12 ex KA3 p 15.

[5]  Inkerman Station is actually comprised of four adjoining pastoral lease holdings known as Galbraith, Alma, Wynola and Kuparee – per Affidavit of Karina O'Neil filed doc 6 KVO2.

[6]  See s 121.

[7]  Sections 27 and 37A of the Regulation.

[8]  Per s 201.

[9]    Per s 209.

[10]  Per s 213.

[11]  Per ss 214-214E.

[12]  See Aronson & Groves, Judicial Review of Administrative Action, 5th edition, [4,480] p 236.

[13]  A phrase used in this context by Lockhart J in AG (NT) v Minister for Aboriginal Affairs (1989) 23 FCR 536, 540.

[14] Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355, 384.

[15]  See s 14B Acts Interpretation Act 1954 (Qld).

[16]  Affidavit of Kev Allan filed doc 12 ex KA2 pp 6-14.

[17]  Affidavit of Kev Allan filed doc 12 ex KA2 p 11.

[18]  Affidavit of Kev Allan filed doc 12 ex KA2 p 12.

[19]  Affidavit of Kev Allan filed doc 12 ex KA2 p 14.

[20]  Affidavit of Kev Allan filed doc 12 ex KA3 p 15.

[21]  Affidavit of Kev Allan filed doc 12 ex KA3 p 16.

[22]  Affidavit of Kev Allan filed doc 12 ex KA3 p 16, KA16 p 71.

[23]  Affidavit of Kev Allan filed doc 12 ex KA3 pp 15-23.

[24]  Affidavit of Kev Allan filed doc 12 ex KA10&11 pp 49-51.

[25]  Affidavit of Kev Allan filed doc 12 ex KA9 p47, KA13 p 66.

[26]  Affidavit of Kev Allan filed doc 12 ex KA17 p 72.

[27]  Affidavit of Kev Allan filed doc 12 ex KA21 pp 89-99.

[28]  Affidavit of Kev Allan filed doc 12 ex KA21 pp 90-94.

[29]  Affidavit of Kev Allan filed doc 12 ex KA21 pp 97-99.

[30]  Affidavit of Kev Allan filed doc 12 ex KA21 pp 97-98.

[31]  Affidavit of Kev Allan filed doc 12 ex KA18 pp 75-76.

[32]  Affidavit of Kev Allan filed doc 12 ex KA20 p 80.

[33]  Affidavit of Kev Allan filed doc 12 ex KA20 pp 82-86.

[34]  Affidavit of Kev Allan filed doc 12 ex KA23 pp 102-265.

[35]  Affidavit of Kev Allan filed doc 12 ex KA23 pp 114-116.

[36]  Affidavit of Kev Allan filed doc 12 ex KA23 pp 117-118.

[37]  Affidavit of Kev Allan filed doc 12 ex KA23 pp 125-126.

[38]  Affidavit of Kev Allan filed doc 12 ex KA27 pp 272-274.

[39]  Affidavit of Kev Allan filed doc 12 ex KA27 pp 273-274.

[40]  Affidavit of Kev Allan filed doc 12 ex KA30 pp 285-318.

[41]  Affidavit of Kev Allan filed doc 12 ex KA30 pp 289-293.

[42]  Affidavit of Kev Allan filed doc 12 ex KA30 pp 311-313.

[43]  Affidavit of Kev Allan filed doc 12 ex KA30 pp 319-320.

[44]  Affidavit of Kev Allan filed doc 12 ex KA33 pp 353-355.

[45]  Affidavit of Kev Allan filed doc 12 ex KA34,35 pp 356-359.

[46]  Affidavit of Kev Allan filed doc 12 ex KA36 pp 363-364.

[47]  Affidavit of Kev Allan filed doc 12 ex KA38 p 374.

[48]  Affidavit of Kev Allan filed doc 12 ex KA39 p 379.

[49]  Affidavit of Kev Allan filed doc 12 ex KA40.

[50]  Affidavit of Kevin Allan filed doc 7 ex KAA.

[51]  T2-12 L27.

[52]  T2-12 L39; also see T2-40 L29 and T2-41 L22.

[53]  Ex 1.

[54]  T2-9 L20.

[55]  T2-9 L33.

[56]  T2-26 L2.

[57]  T2-17 L25; affidavit of Daniel Maroske DJM-1 p 1.

[58]  T2-18 LL10-40.

[59]  T2-54 L44.

[60]  T2-18 L26, T2-21 L25.

[61]  T2-22 L32.

[62]  Affidavit of Daniel Maroske Ex DJM-1 pp 398, 483.

[63]  Affidavit of Daniel Maroske Ex DJM-1 p 533.

[64]  T2-24 L34.

[65]  Affidavit of Daniel Maroske Ex DJM-1 p 595.

[66]  T2-24 L37.

[67]  T2-26 L10.

[68]  T2-24 L42, T2-26 L10.

[69]  T2-32 L 8.

[70]  T2-30 L 43 – T2-31 L28.

[71]  Affidavit of Daniel Maroske Ex DJM-1 p 255.

[72]  Affidavit of Daniel Maroske Ex DJM-1 p254.

[73]  Affidavit of Daniel Maroske Ex DJM-1 p 253.

[74]  T2-31 L34.

[75]  Affidavit of Daniel Maroske Ex DJM-1 p 256.

[76]  T2-29 LL5-40, T2-32, T2-33.

[77]  Affidavit of Daniel Maroske Ex DJM-1 p 340

[78]  Affidavit of Daniel Maroske Ex DJM-1 pp 431-432.

[79]  Affidavit of Daniel Maroske Ex DJM-1 p 424.

[80]  T2-38 L45.

[81]  Affidavit of Daniel Maroske Ex DJM-1 pp 507, 553.

[82]  T2-47 LL10-40.

[83]  T2-48 – T2-49.

[84]  T2-50 L26.

[85]  T2-50 L28.

[86]  T2-50 L28 – T2-51 L10.

[87]  T2-64 L43, T2-75 L13.

[88]  T2-75 L40 – T2-76 L15.

[89]  T2-73 LL20-33.

[90]  T2-76 L43.

[91]  T2-45 L44.

[92]  T 2-61 L15 – 2-66 L31.

Close

Editorial Notes

  • Published Case Name:

    Inkerman Station Pty Ltd as Trustee for the Inkerman Station Trust v Allan & Ors (No. 2)

  • Shortened Case Name:

    Inkerman Station Pty Ltd v Allan (No 2)

  • MNC:

    [2017] QSC 243

  • Court:

    QSC

  • Judge(s):

    Henry J

  • Date:

    27 Oct 2017

  • White Star Case:

    Yes

Litigation History

EventCitation or FileDateNotes
Primary Judgment[2017] QSC 24327 Oct 2017-

Appeal Status

No Status

Cases Cited

Case NameFull CitationFrequency
Attorney-General for the Northern Territory v Minister for Aboriginal Affairs (1989) 23 FCR 536
2 citations
Jump To
Cite 1 - (1989) 23 FCR 536
Cite 2 - (1989) 23 FCR 536
City of Enfield v Development Assessment Commission (2000) 199 CLR 135
2 citations
Jump To
Cite 1 - (2000) 199 CLR 135
Cite 2 - (2000) 199 CLR 135
Inkerman Station Pty Ltd v Allen [2017] QSC 147
1 citation
Jump To
Cite 1 - [2017] QSC 147
Project Blue Sky v Australian Broadcasting Authority (1998) 194 C.L.R 355
2 citations
Jump To
Cite 1 - (1998) 194 C.L.R 355
Cite 2 - (1998) 194 C.L.R 355
Timbarra Protection Coalition Inc v Ross Mining NL (1999) 46 NSWLR 55
2 citations
Jump To
Cite 1 - (1999) 46 NSWLR 55
Cite 2 - (1999) 46 NSWLR 55
Woolworths Ltd v Pallas Newco Pty Ltd (2004) 61 NSWLR 707
2 citations
Jump To
Cite 1 - (2004) 61 NSWLR 707
Cite 2 - (2004) 61 NSWLR 707

Cases Citing

Case NameFull CitationFrequency
Ramsay Health Care Australia Pty Limited v Brisbane City Council [2024] QPEC 492 citations
1

Require Technical Assistance?

Message sent!

Thanks for reaching out! Someone from our team will get back to you soon.

Message not sent!

Something went wrong. Please try again.