In brief

The case of Corella Valley Corporation Pty Ltd v Campbell [2019] QLC 44 concerned the compensation payable to a landowner in relation to an application by Corella Valley Corporation Pty Ltd (Applicant) to renew its access to two mining leases. In concluding that no compensation was payable, the Land Court of Queensland relevantly held as follows:

  • compensation will not be awarded for the mere presence of an access track;

  • other access agreements do not assist the Court to determine the compensation payable to a landowner without information about the circumstances in which such agreements were negotiated;

  • the liability to pay compensation to a landowner should be shared amongst the parties who use the access track; and

  • the Court does not have power to compensate a landowner for costs incurred by the landowner in negotiating an access agreement.

Background

The Applicant held two mining leases in Cloncurry, which were accessed using a track on a nearby lot owned by Mr Campbell (Landowner). The mining leases had been held by the Applicant since the early 1970s, and the access track was constructed between 1974 and 1976.  The access track was 6.4km long and 20m wide, being a total of 12.8ha.  

The Applicant applied to renew its access to the mining leases for a period of two years commencing on 1 May 2018, but could not agree on the compensation payable to the Landowner for the renewed access.  

The Landowner submitted that the access track diminished the Landowner's use of the land because the dust generated by traffic made the vegetation nearby unpalatable to his cattle.  The difficulty for the Court was how and whether this loss could be quantified.

Mere presence of an access track did not entitle the Landowner to compensation

In considering the compensation payable, the Court had to consider the matters set out in section 281(3) of the Mineral Resources Act 1989 (Qld) (MRA), which linked any compensation payable to loss or expense arising from the Applicant’s use of the land (at [4]). 

The Landowner calculated that the compensation payable was $250 per kilometre, but provided no evidence for this calculation. The Landowner also pointed to a decision where the Warden ordered that compensation be paid for the renewal of a 20 year lease because of the deprivation of possession of the surface of the land (see section 281(3)(a)(i) of the MRA).  

The Court noted that the access track was not fenced and that the renewal was for a period of two years.  In such circumstances, the Court held there was no basis for adopting the Warden’s method of calculation.  

In relation to the Landowner’s submission that traffic made the nearby vegetation unpalatable, the Court held that without supporting evidence, it could not accept the Landowner’s submission. In doing so, the Court found as follows (at [12]):

  • the track had been used for many years, and any initial effect on cattle would have dissipated;

  • the Applicant submitted that it would only be using the track a couple of times per month; and

  • a video of the access track showed no evidence of dust deposits on the surrounding vegetation which was described as “reasonably vigorous”.

The Court held that it would not award the Landowner compensation for the mere presence of the access track, and determined that the amount payable was nil.

Evidence of another compensation agreement is not helpful when determining the compensation payable

Both parties pointed to other agreements to form the basis for their assessment of compensation. 

The Court considered whether such agreements satisfied the test in Spencer v Commonwealth [1907] HCA 82, where the High Court of Australia held that when assessing the value of land, "the basis of valuation should be the price that a willing purchaser would at the date in question have had to pay to a vendor not unwilling, but not anxious, to sell.

The Court concluded that in the absence of information about the circumstances in which the other agreements were negotiated, it was unable to conclude that such agreements represented a bargain that satisfied the test in Spencer.  

If an access track is used by multiple parties, compensation should be shared among the parties

The Applicant submitted that any compensation payable should be shared with another mining company who used the access track. The Court agreed with this submission and concluded that the Applicant’s contribution to any loss should be no more than 50%.  This was a moot point given that compensation was assessed at nil.

Conclusion

The Court ordered that the compensation payable to the Landowner for access by the Applicant to the nearby mining leases was nil. The Court also concluded that it did not have power to compensate the Landowner for costs incurred in negotiating the access agreement.

This is commentary published by Colin Biggers & Paisley for general information purposes only. This should not be relied on as specific advice. You should seek your own legal and other advice for any question, or for any specific situation or proposal, before making any final decision. The content also is subject to change. A person listed may not be admitted as a lawyer in all States and Territories. © Colin Biggers & Paisley, Australia 2020.

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