As suburban Cairns encroached upon the Mann family’s cane farm at Mill Road, Edmonton (the farm) it drew attention from state and local government for acquisition. The Queensland Government took about 40% of the farm, then returned it, only paying partial compensation. The Cairns Regional Council then took another, smaller section of the farm, compensating the estate.
Acquisition
In Queensland, the Acquisition of Land Act 1967 (Qld) provides several purposes for the compulsory acquisition of land, including roads, railways, soil conservation, dams, drainage, and even “experimental farms.” Other laws also allow the taking of land, including the Electricity Act 1994 (Qld) and the Petroleum and Gas (Production and Safety) Act 2004 (Qld).
A proposed land acquisition requires the constructing authority to serve the landowner with a Notice of Intention to Resume. The Notice of Intention to Resume will specify the date the landowner may object to the resumption. Following a hearing and consideration of any objections, the constructing authority will make a final decision. A formal proclamation will be published in the Government Gazette if the compulsory acquisition is approved.
Unlike compulsory acquisitions by the Commonwealth, the entitlement to compensation on just terms provided for in the Constitution does not apply in Queensland. Instead, the Acquisition of Land Act 1967 (Qld) generally entitles a person having an interest in the land resumed to compensation and identifies the principles considered when calculating the compensation payable.
Compensation
When determining the compensation payable, the government will take the “highest and best use” of the property into account and not necessarily its current use. Compensation may also be available for “disturbance costs” incurred due to the resumption. Disturbance costs may include legal costs, the cost of purchasing a replacement property, removal and storage costs, and loss of profit or other economic losses resulting from business interruption. If the parties cannot agree on the amount of compensation, the landowner can apply to the Land Court for an assessment.
Suppose your land is affected, or potentially affected, by a compulsory acquisition. In that case, it is common for the owner to meet with the authority intending to resume the land. Before agreeing to such a meeting, it is crucial to understand your rights and obligations under the Acquisition of Land Act 1967 (Qld) and seek appropriate advice.
Background
Geoffrey Mann (the deceased), who co-owned the farm, made a Will when only the State Government resumption and partial compensation had occurred. The Will appointed his wife Nan as executor (the executor) with a share in the Mill Road farm and two other family farms going to his adult children Graeme Peter, (the applicant) Stuart, and Natalie, with the residue of his estate left to the executor.
Following the deceased’s death, the estate settled the Council resumption compensation claim and received a compensation amount of $750,000 on 30 October 2017. Also, after the deceased’s death, the Queensland State Government revoked its resumption without notice from the perspective of the Manns. The only time there had been any suggestion of it as a possibility was during the Liberal National Party’s period of executive government from March 2012 to January 2015. However, the Labor Party reaffirmed its continued commitment to the Southside hospital development upon its return to the executive government.
When making his Will, the deceased believed that the farm did not include the 40% resumed by the State Government but that the deceased would receive further compensation for that resumption. The deceased could not have known that, following his death, the State Government would revoke the resumption and return the land. Nor could he have known that the local Council would proceed to resume a further part of the farm and pay compensation following his death. Unsurprisingly, the deceased did not expressly cater for the possibility of such future events.
The matter
In Mann v Mann & Ors [2024] QSC 50 the executor and the applicant disagreed on how the executor should interpret the Will concerning the outcome of those unanticipated events. Should the State Government return the land, and should the compensation paid by the Council go to the children or the executor? The applicant sought a declaration that each forms part of the property left to the children, while Nan argues that they each form part of the residue.
The only two dispositive clauses were clauses 4 and 5. Clause 4 dealt with the disposition of the deceased’s interests in the three family farms. In contrast, clause 5 left the residuary of his estate, after meeting the estate’s debts and expenses, to the executor. Its meaning is not in issue. It described the residue as:
“…all my real and personal estate, wherever it is and in whatever form it is, not otherwise disposed of by this will”.
The only property disposed of by the Will was the property left by cl 4 to the children.
Specific Gifts
Two construction issues arise from the typed writing and handwriting in clause 4.1, headed “Specific gifts”.
The first issue relates to what real property was part of the Mill Road property in cl 4.1 due to the handwritten additions after cl 4.1(a) ‘s “Mill Road, Edmonton”. The handwritten references to “L500 SP171159” and “500L” match the lot and plan numbers of other real property, namely that at “Wiseman Road, Edmonton,” referred to by the typed words of cl 4.1(b). The only lots described explicitly in the handwriting were Mill Road farm lots 1 and 4 of SP240391. Therefore, the question to be determined is whether the revested part of the Mill Road farm that the State Government had purportedly resumed is part of the Mill Road property described in cl 4.1.
The second issue relating to cl 4.1 is the meaning of “proceeds of sale” and “income”, as referred to in the clause. This issue is significant because the estate received compensation from the Council’s resumption of part of the land described in cl 4.1 (a) after Geoffrey’s death. Therefore, the question for determination is whether the Council resumption compensation is within the meaning of “proceeds of sale” or “income” as referred to in cl 4.1.
Construction of the Will
Before moving to the construction of the Will, the court provided the sequence of Mill Road farm resumption and compensation events relative to the date of the Will and Geoffrey’s death. The Mann family has owned a farm of varying scale at Mill Road since 1907. Alexander, their father, inherited the farm from his father in 1939. It was inherited by Allan and Geoffrey in equal shares on their father’s death in 1966. Together, they purchased additional farms without mortgaging Mann’s Farm in the 1970s.
The Queensland State Government’s compulsory acquisition of part of the brothers’ Mill Road farm, ostensibly for a future hospital, health precinct, and roads, occurred in December 2010. The resumption was of 21.567 ha of land, constituted by lots 2, 3, 5, and 6 of the land described in what became Survey Plan (i.e. “SP”)240391. The resumption did not include lots 1 and 4 of SP240391. It did include a resumption of a smaller homestead block, lot 9, but is not considered relevant to the parties’ present dispute.
The farm had initially been 54.155 hectares. The land resumed by the State Government thus represented roughly 40 per cent of the farm. This left lot 1 at 19.848 ha and lot 4 at 12.74 ha, about 32.59 ha, as the remaining Mill Road farm owned by the deceased and his brother.
The decision
In dismissing the application seeking declarations at odds with the proper construction of the deceased’s Will, the Court held that it was unnecessary to articulate the construction favoured by the executor. The controversy regarding the uncertain impact of government interference on the Will’s meaning in the testator’s private property should be resolved by the estate bearing the parties’ costs on an indemnity basis.