Fairhill Coking Coal Pty Ltd v Comiskey & Anor

(b) there has, since the agreement or determination, been a material change in circumstances for the mining lease.

a different mining method that changes the impact of mining operations under the lease

(2) The mining lease holder or any owner in relation to the mining lease mentioned in section 279(1)(a) or 280(1) may apply to the Land Court for it to review the original compensation.

(4) The Land Court may, after conducting the review, decide to confirm the original compensation or amend it in a way the Land Court considers appropriate.

(5) However, before making the decision, the Land Court must have regard to -

(a) the original compensation, other than any part of it that consists of an additional amount under section 281(4)(e); and

(b) whether the applicant has attempted to mediate or negotiate an amendment agreement for the original compensation; and

(c) any change in the matters mentioned in section 281(3) and (4) since the original compensation was agreed or determined.

(6) If the decision is to amend the original compensation, the original compensation, as amended under the decision, is for this Act, other than this section, taken to be the original compensation.

• [14] The principles of statutory construction are well known.[5]
• [15] Section 283B(1)(b) is accompanied by an example. An example cannot limit the meaning of the section, nor is it exhaustive. The section and the example are to be read in the context of each other and the other provisions of the Act: section 14D, Acts Interpretation Act 1954.
• [16] Section 283B was inserted into the MRA by the Environmental Protection and Other Legislation Amendment Act 2000. The Explanatory Memorandum does not assist with the meaning of section 283B(1)(b). Interestingly, though, it says that sections 283A and 283B were inserted because "[t]here are no provisions to amend or vary an agreement during the term of the lease if this becomes necessary due to operational change".

• [17] After Fairhill failed to make a payment required in the compensation agreement, the Comiskeys initiated the dispute resolution mechanism in the agreement. A mediation was scheduled.
• [18] The day before the mediation - on 3 April 2023 - the parties reached an agreement by email. The agreement was:

1. on or before 28 April 2023, Fairhill will pay to the Comiskey [sic]:

1. the outstanding compensation of $4,000,000 (plus default interest); and

1. if Fairhill has not paid the above amounts (as detailed in paragraph 3a and 3b) in full by 28 April 2023, the Parties agree to participate in a renegotiation process where:

1. each party will be entitled to engage an independent valuer, and Fairhill will meet the Comiskey's reasonable and agreed costs for their valuer; and

1. once each party has obtained its valuation report, the parties will exchange reports and will arrange a meeting to renegotiate the compensation payable to the Comiskey.

• [19] That 3 April 2023 agreement has been described as the "Agreed Process".
• [20] Fairhill did not make any payment to the Comiskeys by 28 April 2023.
• [21] Then began the second step of the Agreed Process.
• [22] On 2 May 2023, the Comiskeys' solicitor wrote to Fairhill advising that the Comiskeys had retained a valuer to begin a further compensation assessment.
• [23] On 4 May 2023, Fairhill acknowledged that email and said it would obtain its own valuer's availability. It asked for the name and expected cost of the Comiskeys valuer.
• [24] On 12 September 2023, the Comiskeys told Fairhill that their valuer's report was ready and that they wished to begin the renegotiation as soon as reasonably practicable.
• [25] On 20 September 2023, Fairhill paid $7.45 million to the Comiskeys, plus $476,016.91 in interest.[6]
• [26] The Comiskeys said that regardless of that payment, the second step of the Agreed Process had to be fulfilled.
• [27] Fairhill confirmed that it would follow the second step process.
• [28] Fairhill provided a valuation report. There was a mediation. No agreement was reached.
• [29] After that mediation, Fairhill told the Comiskeys that Fairhill considered that each party's obligations under the Agreed Process had been fulfilled.
• [30] Shortly afterwards, the Comiskeys commenced a proceeding in the Supreme Court seeking declarations.
• [31] That application was dismissed. The Supreme Court explained:

[35] The Comiskeys submit that reaching an agreement to renegotiate compensation had the effect of undoing the [compensation agreement] and leaving the parties in a position as if no agreement about compensation had been reached. This cannot be accepted.

[36] The 3 April 2023 agreement must be construed within the context of the mechanisms of the [MRA]. The fixing of compensation is critical under the scheme of the Act. I reject the Comiskeys' claim for a declaration that compensation "has not been agreed" for the purposes of the Act. It has been agreed. It was agreed, by the [compensation agreement], on 27 August 2020. I similarly reject the claim for a declaration that there is no agreement for the purposes of the Act. There is. It is the same agreement.[7]

• [32] Other aspects of the Supreme Court's reasons in relation to the duty to cooperate are set out, below.

• [33] The key question is whether section 283B of the MRA is engaged.
• [34] The Comiskeys produced particulars of what they say are the material changes. That document[8] identifies four changes:

(a) Fairhill breached a condition of the mining lease to make all payments of compensation and comply with all terms of any agreement or determination relating to compensation at the time or times as agreed;

(b) the parties agreed to "renegotiate compensation" payable for the grant of the mining lease, pursuant to an agreed process;

(c) the Supreme Court determined that the agreed process gives rise to an obligation on Fairhill to cooperate and allow the Land Court to review the compensation;

(d) there has been a substantial increase in the losses occasioned to the Comiskeys by the grant of the mining lease since the compensation agreement was agreed.

(a) the example following section 283B(1)(b) means that the section is directed to operational changes which affect the land, or impacts the operations upon the land, in a way that is material to the amount of compensation;

(b) there must be a material change in circumstances "for the mining lease" - a breach of the compensation agreement is not a material change in circumstances "for the mining lease";

(c) a delay in making payments may give the landholders a cause of action for damages for breach of contract or may have amounted to a repudiation of the compensation agreement - but neither is a material change in circumstances for the mining lease;

(d) section 283B(1) should not be interpreted to permit compensation to be reassessed because land values have risen since compensation was agreed or determined;

(e) the Agreed Process was not itself a material change.

(a) only one of the four material change particulars is required to establish that this Court has jurisdiction;

(b) there is a binding ratio decidendi in the Land Appeal Court decision of ERO Georgetown Gold Operations Pty Ltd v Henry[9] that compels this Court to conclude that each of the four particulars satisfies the provision;

(c) that binding ratio is that section 283B(1) will be satisfied where three conditions are met:

(i) there is a difference between the circumstances at the time when the compensation was originally agreed or determined and at the date the change is said to have occurred;

(ii) the difference (ie. 'change') is material; and

(iii) the difference (ie. 'change') relates to circumstances relevant to the agreement about or determination of compensation.

(d) for particular 1 - Fairhill's failure to pay compensation under the agreement was a breach of its mining lease as imposed by section 276(1)(j) of the MRA. That was not a technical nor short-lived breach, but was serious and substantial;

(e) for particular 2 - because the Agreed Process was to revisit the very heart of the earlier bargain, it was a substantial or significant change relevant to the agreement about compensation;

(f) for particular 3 - the Supreme Court decision obligates Fairhill to cooperate and allow the Land Court to review the compensation because the Supreme Court must have considered the change in circumstances to be material;

(g) for particular 4 - it is not just the increase in the value of the land. The material change is the substantial decrease in value brought about by the mining lease between the time compensation was agreed and when the compensation was actually paid.

• [37] The parties identified Land Appeal Court and Land Court authorities and a decision of the Land and Resources Tribunal that may assist with the construction of section 283B(1).
• [38] The Land Appeal Court decisions are Glencore Coal Queensland Pty Ltd & Ors v Keys & Ors[10] and ERO Georgetown Gold Operations Pty Ltd v Henry.[11]

• [39] Glencore Coal was an appeal against the initial determination of compensation. The mining companies submitted that the Land Court had erred by applying the sales evidence in a generous way. In that context, there was argument about how, in theory, a compensation amount can be changed.
• [40] The Land Appeal Court said:

... The explanatory memorandum for the amending legislation which introduced s283A and 283B identified "operational change" as the circumstance of which would make an adjustment to compensation appropriate. These considerations suggest the section is not made applicable simply because of a change in market value over time. Once the condition is satisfied, questions of then current market value become relevant; but that does not assist in identifying the proper construction of the provision which makes the section applicable.[12]

The circumstances in which s 283B might be applicable were not fully argued in this Court. Nor is it necessary in this case to determine its scope. It is sufficient to note that there is real reason to doubt that it would become available, simply because of a movement in the market for land between the date of the determination, and the date when compensation is paid.[13]

• [41] In ERO Georgetown, the miner constructed a fence with a locked gate across a constructed road on the property. The Land Court found that constituted a material change in circumstances for the mining lease. The Land Appeal Court agreed.
• [42] The Land Appeal Court concluded:

(a) the context within which section 283B appears:[14]

... strongly suggests that the circumstances referred to in s283B(1)(b) are those related to the identification of compensation. That is consistent with the evident purpose of s283B, which is to confer on the Land Court jurisdiction to review compensation, at some time after it was originally determined, by the Land Court, or agreed.[15]

(b) section 283B(1) requires a comparison between two sets of circumstances. The first is the circumstances at the time when compensation was originally agreed or determined. The second is that prevailing when it is alleged that the circumstances have changed;[16]

(c) the change must relate to circumstances relevant to the agreement about or determination of compensation;[17]

(d) the words "for the mining lease" were unlikely intended to be narrowly defined. The word "for" is used to identify a connection between the change of circumstances, and the mining lease. The word "for" is not to mean "with the object or purpose of", so that the change must have "as its object or purpose the mining lease itself";[18]

(e) section 283B(1) is not limited to a change in circumstances relating to the mining lease, considered as a grant of rights. It extends to changes in the way the rights are exercised, such as operational changes; and to the effects of those changes, no doubt on the person entitled to compensation.[19]

• [43] The most helpful Land Court decision is Nothdurft & Anor v QGC Pty Ltd & Ors.[20] There, the President of the Court considered the meaning of section 537C of the Petroleum and Gas (Production and Safety) Act 2004. Section 537C(1) was, materially, the same as section 283B(1) of the MRA.[21]
• [44] The Court concluded:

(a) that s537C(1) sets a two stage test - first that the circumstances have changed and second, that the change is material;[22]

(b) that:

[28] The focus on effect rather than activity means not every change in circumstance that might be relevant to compensation will require review of the original compensation. The requirement of materiality qualifies the degree of relevance. Something is material if it is of significance or importance. It must be of moment or of significance, not merely trivial or inconsequential. If reliance is placed on a change in amenity, the impacts must be more than minimal.[23]

(c) a "material change in circumstances" should mean actual circumstances, not perceptions about them.[24]

• [45] In Nothdurft, the landowners identified eight matters which they said constituted a material change in circumstances. The landowner's evidence fell short of substantiating all eight. The Court accepted two amounted to a material change in circumstances:

(a) noise impacts on the landowners that had been in excess of limits set in the Environmental Authority;[25] and

(b) the cessation of access to untreated coal seam gas water by the landowners.[26]

• [46] The other cases are less directly helpful.[27] The Tribunal decision in Hicks v Graham indicates that the assessment of materiality is to be based on a "change that is pertinent to what compensation should be awarded, not a change that is of substantial import to the compensation that should be awarded".[28]
• [47] In Hicks v Graham, a change in operating conditions for a mining lease (replacing a condition not to disturb more than a specified area, with a condition that the area of disturbance must be minimised)[29] was found to be a material change. The other cases referred to do not offer findings based on factual situations.

Conclusions about the construction of the provision

• [48] Consolidating what the cases say, with a reading of the provision (including the example) in its context, my view about the meaning of section 283B(1) is:

(a) it involves a two stage test - first that the circumstances have changed and second that the change is material;

(b) it is not engaged by a change in market value over time;

(c) it encompasses the effect of operational changes on the person entitled to the compensation;

(d) most operational changes are easy to identify as a material change in circumstances for the mining lease - closing a road, creating more noise than expected or cutting off water supply are obvious;

(e) changes that manifest 'on paper'- but with no other change to the way the mining is done - are more difficult to assess. An 'on paper' change to the length of the mining activity would be likely to constitute a material change in circumstances for the mining lease because the impact on the landowner would be prolonged. An 'on paper' change that causes no noticeable difference for the landowner would be a different matter;

(f) an indication that a change amounts to a material change in circumstances for the mining lease, would include a change that would have influenced the original negotiation for compensation. That is, an aspect of the mining activity that the landowner would have to adjust to - but as a result of the change, would now have to adjust to in a different way.

• [49] It should not be assumed that any material change in circumstances for the mining lease will lead to an increase in the amount of compensation.[30] Reassessment of compensation is a separate matter.
• [50] I do not agree with the Comiskeys' three point articulation of the ratio decidendi of ERO Georgetown. The third point - that the difference (ie. 'change') relates to circumstances relevant to the agreement about or determination of compensation - is cast too broadly. The Land Appeal Court was talking about circumstances that had been relevant to the way in which compensation had originally been set. That is, circumstances of the mining lease such as deprivation of possession, or access arrangements or noise intrusion.
• [51] Because I do not accept that that is the ratio of ERO Georgetown, I do not accept the submission that this Court is compelled to accept the Comiskeys' four particulars are material changes in circumstances for the mining lease.

• [52] My conclusions about the four matters identified in the Respondents' Particulars of Material Change are:

(a) for item 1 -Fairhill's failure to pay on time was not technical nor short lived. For the Comiskeys, it was serious and substantial. The Comiskeys say that the failure to pay was a breach of a condition of the mining lease, citing section 276(1)(j).[31] That seems correct. Whether an act is a breach of a condition does not directly correlate with it also being a material change in circumstances for the mining lease. There may be instances where it is both. Here, though, the breach of the condition does not satisfy the test in section 283B(1).

The parties contemplated the possibility that aspects of the compensation agreement may not be complied when the agreement was negotiated. That is why there was a dispute resolution mechanism in the agreement.

(b) for item 2 - the Agreed Process is not a material change in circumstances for the mining lease. The agreement to renegotiate was a separate contractual process. It does not fit within the scope of section 283B(1)(b);

(c) for item 3 - the Supreme Court's reasons do not compel this Court to conclude there has been a material change in circumstances for the mining lease. The reasons for that are set out further below in relation to the duty to cooperate;

(d) for item 4 - the increase in the value of the land is not itself a material change. The Comiskeys say that it became a material change because of a substantial decrease in value brought about by the mining lease between the time compensation was agreed and when the compensation was actually paid. That is just a different way of saying that the land has increased in value since the compensation agreement was finalised on 27 August 2020. Fairhill paid interest at the time of making its late payments. Even if that interest amount is not correct - which it may not be - Fairhill accounted for the time between when the payment ought to have been made and when it was paid.[32] The land may have increased in value by the time the late payments were made, but this is not so unexpected or unusual as to make the late payments a material change in circumstances for the mining lease.

• [53] The Comiskeys seek a declaration that Fairhill is precluded from pressing its general application filed 11 December 2024. They say that Fairhill has a duty to cooperate with them.
• [54] The duty to cooperate is not in the statute. It is said to have been identified by the Supreme Court. The relevant passages from the Supreme Court reasons, follow. The reference to the "second step" is a reference to the Agreed Process set out at paragraph [18] above.

[29] ... the parties must have intended the obligation in the second step to include an obligation to cooperate to enable the Land Court to review the original compensation agreed in the CA under s 283B of the Act, in the event that the parties were unable to agree on amended compensation. This aspect of the 3 April 2023 agreement involves some difficulty. For the Land Court to review such a matter under s 283B of the Act, there must also have been a material change in circumstances for the mining lease since the CA was made.

[30] The conduct of the parties in agreeing to renegotiate the compensation, as plainly evidenced by the 3 April 2023 agreement, assumes that there has been a material change in circumstances relevant for the compensation amount. It assumes that that change in circumstances has occurred since the amount was agreed.

[37] The exchanges between the parties that evidence the 3 April 2023 agreement, indicate that the parties were then at one in thinking that if not paid by 28 April 2023, the circumstances of the mining lease had materially changed, so that the compensation Fairhill should pay for it should be different to the compensation they had agreed in the CA. Since then, they have been unable to agree on what that different compensation should be.

[39] The provisions in the Act about amendment and review are clear. Until the parties either reach agreement on an amendment to the compensation in the CA and cooperate to have it registered, or until they cooperate to allow the Land Court to review the compensation payable under the CA in light of changed circumstances, the CA will, by operation of the Act, continue to be in force.

[42] The Comiskeys say they wish to go to the Land Court. On this Court's analysis of the 3 April 2023 agreement, the Comiskeys should have the cooperation of Fairhill in doing so. A declaration could probably be sought and made in the Land Court. One has to be very cautious about approaching matters that may be in the Land Court's jurisdiction.

• [55] The Comiskeys submit that it has been judicially determined that the Agreed Process includes a contractually binding obligation on Fairhill to "cooperate", "enable" or "allow" the Land Court to review compensation pursuant to section 283B in light of changed circumstances. They say that an issue estoppel prevents Fairhill from contending it is not under an "obligation to enable the Land Court to review the original compensation agreed in the compensation agreement, conducting that review under section 283B of the MRA, in the event that the parties were unable to agree on an amended compensation".
• [56] Fairhill submits:

(a) both parties had different positions before the Supreme Court than each presented to this Court - including that the Comiskeys told the Supreme Court there had been no material change in circumstances for the mining lease;[33]

(b) the Comiskeys' particulars of the material change were not available to the Supreme Court;

(c) there is no issue estoppel because whether in fact there had been a material change in circumstances for the mining lease was not so fundamental to the decision of the Supreme Court that the decision cannot stand without it.[34] The issue for determination in this Court is not identical to the issue before the Supreme Court.

• [57] This Court is anxious to give effect to the reasons of the Supreme Court.
• [58] That said, I accept Fairhill's submission that the decision of the Supreme Court does not create an issue estoppel. What the parties submitted to the Supreme Court about the question of a material change in circumstances for the mining lease was different to what was submitted here. The Respondents' particulars were only produced after the Supreme Court decision.
• [59] Reading the Supreme Court judgment as a whole, it appears that Justice Bradley (as his Honour then was) intended for the compensation to be reviewed by this Court. That conclusion was, with respect, understandable in the context in which that decision was made.
• [60] I do not, though, interpret the Supreme Court's reasons as a judicial determination that either gives this Court jurisdiction[35] or requires this Court to conclude that there has been a material change in circumstances for the mining lease. The submissions made to the Supreme Court were sufficiently different to what they now are, so as to make direct application of the Supreme Court's reasons difficult here.
• [61] As to the "duty to cooperate", put in its proper context, I cannot conclude that it goes so far as to oblige Fairhill to not press an application in this Court. Nor does it go so far as to oblige Fairhill to accept that section 283B has been engaged. Fairhill submits that the Comiskeys' submissions incorrectly equate cooperate with capitulation. I agree.

• [62] The frustration experienced by the Comiskeys is understandable. Fairhill did not pay when it was obliged to. Then the Agreed Process became an unnecessary source of complexity and stress.
• [63] Despite that, my view is that this Court is constrained by section 283B(1)(b). Fairhill's disappointing behaviour do not qualify as a "material change in circumstances for the mining lease".
• [64] As to the effect of the Supreme Court's reasons and the duty to cooperate, it is challenging to identify the exact scope of that duty. It is not clear that the Supreme Court had the same picture of the dispute - particularly with respect to the application of section 283B(1)(b) - as is available now.
• [65] The Comiskeys' General Application filed on 17 December 2024 is dismissed.
• [66] The Fairhill General Application filed on 12 December 2024 is successful in that the Respondents' Particulars of Material Change does not identify a material change in circumstances for the mining lease. What follows is that the Comiskeys have not identified a basis in the statute for this Court to proceed under section 283B(1).

• [67] The Court orders:
  1. The Respondents' General Application filed on 17 December 2024 is dismissed.
  2. By 4.00pm on 21 May 2025, the parties are entitled to file and serve submissions as to the form of Order that should follow the conclusions expressed in these reasons.

[1] 'Old Mount Stuart', Lot 2 on Crown Plan TT241. Operated with other Comiskey properties as a cattle grazing enterprise.

[5] SZTAL v Minister for Immigration and Border Protection [2017] HCA 34; (2017) 262 CLR 362 at [14]; R v A2 [2019] HCA 35; (2019) 269 CLR 507 at [32] - [37]; AB (a pseudonym) v Independent Broad-based Anti-Corruption Commission [2024] HCA 10; (2024) 278 CLR 300 at [21].

[6] The Comiskeys do not accept that the interest amount paid was a correct or appropriate amount.

[7] Comiskey v Fairhill Coking Coal Pty Ltd [2024] QSC 137.

[8] 'Particulars of Material Change' filed 5 December 2024.

[9] [2015] QLAC 4; (2015) 36 QLCR 318.

[10] [2014] QLAC 2; (2014) 35 QLCR 194.

[11] [2015] QLAC 4; (2015) 36 QLCR 318.

[12] Glencore Coal Queensland Pty Ltd & Ors v Keys & Ors [2014] QLAC 2; (2014) 35 QLCR 194, [43] (footnotes omitted).

[14] Specifically, sections 279, 281, 282, 283A and 286.

[15] ERO Georgetown Gold Operations Pty Ltd v Henry [2015] QLAC 4; (2015) 36 QLCR 318, [43].

[20] [2017] QLC 41; (2017) 38 QLCR 91.

[21] Section 283B says "... change of circumstances" where section 537C says "... change in circumstance".

[22] Nothdurft & Anor v QGC Pty Ltd & Ors [2017] QLC 41; (2017) 38 QLCR 91, [29].

[25] Ibid [90]. The original compensation assumed that the noise conditions would be met. The Court concluded that steps had been taken to reduce noise impacts and that at the time of the hearing, the noise limits were being complied with.

[26] Ibid [98]. Other circumstances relating to access to water resulted in this material change in circumstances not resulting in any amendment to the original compensation as a result of the change: [149]-[150]

[27] Deimel v Phelps [2022] QLC 6, Shaw v Idemitsu Australia Resources Pty Ltd [2020] QLC 40 and Hicks & Anor v Graham & Anor [2004] QLRT 47.

[28] Hicks & Anor v Graham & Anor [2004] QLRT 47 at [36].

[30] In Nothdurft, one of the two material changes resulted in no adjustment to the compensation.

[31] There does not seem to be a copy of the mining lease conditions before the Court, but I am proceeding on the basis that a condition of the kind specified in s276(1)(j) was imposed.

[32] The Comiskeys could pursue what they say is the correct amount of interest as part of an action for damages for breach of contract.

[33] Submissions of the applicant in reply on the General Application filed by the Respondents on 17 December 2024 filed 21 February 2025 at [2(a)(i)-(iii)], referencing the Transcript of Supreme Court Proceedings of 1 July 2024, page 1-9 line 18 to 1-10 line 15; page 1-9 line 33; page 1-14 lines 15-21; and page 1-19 lines 27-37.

[34] They cite Wilcox v Chapple [2024] NSWSC 1394 at [611].

[35] This is a Court of statute which only has jurisdiction conferred on it by the Land Court Act or another Act.