HEADNOTE
[This headnote is not to be read as part of the judgment]
The appellant (Mangoola) owned land in the Local Government Area of the respondent Council. The land had previously been categorised by the Council for rating purposes under the Local Government Act 1993 (NSW) as "farmland" but for the 2016/17 and 2017/18 years it was re-categorised as "mining" land.
The relevant land was approximately 6,600 hectares in area and surrounded an open-cut coal mine in the Hunter Valley of New South Wales. The land was subject to an access licence agreement with a cattle-grazing enterprise (Colinta). The land also had an easement over part of it for the purposes of supplying water and electricity to the mine; included, as a condition of the mine's project approval, Aboriginal Cultural Heritage Offset and Habitat Enhancement Offset areas; and had on it some environmental monitoring equipment and mining exploration activities. The region was suffering from drought in the relevant years. This affected the grazing activities on the land.
The appellant appealed to the Land and Environment Court (LEC) against the rating categorisation of the land as "mining" in the two relevant years. The primary judge examined the use of the land by reference to three different sections of it: the offset areas (the First Section), the "Wybong lands" (the Second Section), and the areas to the east and south of the mine (the Third Section). The LEC rejected the appeal and held that the dominant use of the land was for mining.
The appellant then appealed to the Court of Appeal under s 57(1) of the Land and Environment Court Act 1979 (NSW) on questions of law. The principal issues on appeal were:
1. Whether grazing occurred on the Wybong lands and the relevance of the ongoing drought in determining the dominant use of the land;
2. The importance that should be placed on the easement for utilities in determining the dominant use of the land;
3. Whether there was any mining use of the land;
4. Whether the offset areas could properly be characterised as being "used for a coal mine";
5. The significance of the environmental monitoring devices and mining exploration activities in determining the dominant use of the land.
The Court allowed the appeal:
(Per Macfarlan JA, Bell P and Brereton JA agreeing at [1] and [68]):
In relation to Issue 1 (drought and grazing on the Wybong lands):
It was not open to Mangoola to challenge the finding of the primary judge that there were "no grazing activities" on the Wybong lands as the challenge raised only a question of fact, not one of law: [28] (Macfarlan JA); [74] (Brereton JA).
What occurred on the land in the relevant years could not sensibly be looked at in isolation from what had previously occurred and what could be inferred was intended to occur after: [40]; [43]. A hiatus in activity on land may not indicate that a prior use has ceased: [41]. The evidence did not suggest that there was any reason other than the drought for grazing not occurring on the Wybong lands in the relevant years: [42]. It should have been inferred that grazing was intended to be resumed when the drought eased. Evidence of abandonment of the prior years' use would have dictated a different conclusion but there was no such evidence: [42]. The primary judge was required to consider the two years in their context and failing to do so led him to misapply the statutory requirements and gave rise to an error of law: [43]. Alternatively, his Honour's finding was unreasonable and therefore not open to him: [44]. (Brereton JA agreed and made additional observations on this issue at [75]).
Longford Investments Pty Ltd v Commissioner of Land Tax (NSW) (1978) 8 ATR 656; [1978] AEGR 71, 091; Saville v Commissioner of Land Tax (1980) 12 ATR 7; Leda Manorstead Pty Ltd v Chief Commissioner of State Revenue (2010) 79 NSWLR 724; [2010] NSWSC 867; Rainn Pty Ltd v Commissioner of State Revenue [2016] VSCA 338; Chief Commissioner of State Revenue v Metricon Qld Pty Ltd [2017] NSWCA 11; Hope v Bathurst City Council (1980) 144 CLR 1; [1980] HCA 16, applied.
In relation to Issue 2 (the easement for utilities):
The primary judge attached considerable significance to the importance to the mine of it obtaining water and electricity through the easement, whereas his Honour should have focussed on the nature and extent of the mine's use of the easement and its impact on the use of the Third Section as a whole: [53]. The primary judge should have attached determinative significance to the following: the easement occupied only a little over 1% of the Third Section; Colinta's right to graze cattle was "interrupted only to a trifling extent" by the presence of infrastructure on the easement; and in both relevant years the Third Section was used for grazing and cropping: [54]. The mining use of the Third Section could not reasonably be regarded as the dominant use: [55]. (Brereton JA agreed and made additional observations on this issue at [76], including that: the use of land which is a servient tenement is not determined by the use of the easement by which it is burdened).
Peabody Pastoral Holdings Pty Ltd v Mid-Western Regional Council [2013] NSWLEC 86; (2013) 211 LGERA 337, applied.
In relation to Issue 3 (whether mining use):
There was a mining use of the Third Section in the use of the easement, albeit that that use was of limited significance in considering the dominant use of that section as a whole: [57]. The "source of the requirement to carry out the use", whether that is of a matter of practicality or a legal requirement, cannot be disregarded and is relevant to determining whether there is a use for mining purposes: [58].
Shire of Perth v O'Keefe (1964) 110 CLR 529; [1964] HCA 37, applied.
In relation to Issue 4 (offset areas):
It is relevant to consider why these areas existed but doing so does not lead to the conclusion that they existed or were used for mining purposes. Although their existence is a condition of the mine's operation, their use is for purposes that are the antithesis of mining: [60]. They are not used "for a coal mine": [61].
(Additional observations on this issue per Brereton JA, Bell P agreeing at [1]): Peabody does not support the conclusion that the First Section lands were used "for a mine", but rather points the other way: [70]. Peabody held: affectation of land is to be distinguished from use of land; change in ownership did not of itself effect a change in use of the land; the purpose of an acquisition does not cause a change in use; and the mere holding of land for mining purposes is not a use of that land for a mine: [71]. Thus the use of these lands did not become "for a mine" by reason of their requirement as a condition of the mine's approval: [73].
Peabody Pastoral Holdings Pty Ltd v Mid-Western Regional Council [2013] NSWLEC 86; (2013) 211 LGERA 337, applied.
In relation to Issue 5 (monitoring devices and exploration activities):
The placement and servicing of the environmental monitoring devices had little impact on the subject parcel: they occupied small areas and their accessing by mine personnel gave rise to little interference with Colinta's farming activities: [62]. The importance of them to the mine cannot be ignored but it is of limited significance in determining the dominant use of the land: [62]. Likewise, the mining exploration activities were limited, rendering them of no present significance: [63]. (Brereton JA agreed at [77]).
(Additional general observations per Brereton JA, Bell P agreeing at [1]):
Division of the parcel into three sections may be permissible as an aid to an en globo assessment, but it is critical that the exercise does not cause one to lose the overall view of the wood for the individual trees: [77].