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Alinta Asset Management Pty Ltd v Essential Services Commission

Alinta Asset Management Pty Ltd v Essential Services Commission

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SUPREME COURT OF VICTORIA

COURT OF APPEAL

No 8453 of 2006

ALINTA ASSET MANAGEMENT PTY LTD
ALINTA ASSET MANAGEMENT PTY LTD	Appellant
v
ESSENTIAL SERVICES COMMISSION	Respondent

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JUDGES:	ASHLEY and DODDS-STREETON JJA and HANSEN AJA
WHERE HELD:	MELBOURNE
DATE OF HEARING:	30 January 2008
DATE OF JUDGMENT:	18 December 2008
MEDIUM NEUTRAL CITATION:	[2008] VSCA 273

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STATUTORY CONSTRUCTION – Purposive approach – Context including Hilmer Report, prior and related legislation - Gas Industry Act 2001 (Vic) s 22(1) – Whether appellant operating gas distribution pipeline pursuant to agreement with owner provides services by means of pipeline under s 22(1) requiring licence - Whether provision of services under s 22(1) must be contractual grant by pipeline owner, lessee or licensee.

STATUTORY CONSTRUCTION - Gas Pipelines Access (Victoria) Act 1998 enacting Gas Pipelines Access (South Australia) Act 1997 (SA) Schedule 1 (Third Party Access to Natural Gas Pipelines) (the ‘Law’) and Schedule 2 (National Third Party Access Code for Natural Gas Pipelines (the ‘Code’) (together, the ‘Access Law’) – Whether appellant is operator in relation to a pipeline and hence Service Provider under s 2 of the Law, subject to obligations under the Code – Relevance of capacity to provide services as defined in s 10.8 of the Code.

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APPEARANCES:	Counsel	Solicitors
For the Appellant	Mr A J Myers QC and Mr C J Delany SC	Blake Dawson
For the Respondent	Mr A C Archibald QC, Mr C M Scerri QC and Mr P R D Gray	Gilbert & Tobin Lawyers

TABLE OF CONTENTS

A.Introduction................................................................................................................................. 1
B.The Judgment below................................................................................................................... 5
Essential features of the natural gas industry..................................................................... 5
Alinta's powers under the Operating Services Agreement.............................................. 7
Analysis of s 22(1) of the GIA 2001..................................................................................... 11
‘Service Provider’ under the Law....................................................................................... 13
Conclusions of trial judge.................................................................................................... 15
C.Notice of Appeal....................................................................................................................... 16
D.Principal contentions................................................................................................................ 16
Alinta’s submissions............................................................................................................. 17
The ESC’s submissions......................................................................................................... 20
E.Relevant Legal Principles......................................................................................................... 21
F.Context of the disputed provisions........................................................................................ 26
History of reform and associated legislative developments.......................................... 27
The Hilmer Report................................................................................................................ 27
Other communiqués, agreements and enactments relevant to context........................ 31
The enactment of national legislation................................................................................ 34
G.The Access Law......................................................................................................................... 34
Relevant provisions of the Law........................................................................................... 35
Relevant Provisions of the Code......................................................................................... 35
Construction of ‘Service Provider’ in s 2 of the Law....................................................... 40
Multiple service providers................................................................................................... 45
The GIA 1994......................................................................................................................... 47
‘provide services … by means of a distribution pipeline’ under the GIA 2001........... 48
Gas Distribution System Code............................................................................................ 64
H.Functional or Factual Approach............................................................................................. 67

The Declarations........................................................................................................................ 69

J.Conclusion.................................................................................................................................. 69

ASHLEY JA:

Having had the advantage of reading in draft the reasons for judgment of Dodds-Streeton JA and Hansen AJA, I agree that the appeal should be dismissed.

The resolution of the appeal turned upon the meaning to be assigned to a very few statutory provisions. In an attempt to give meaning to those provisions, the Court was taken to many other provisions – most extant, some repealed; and to a mass of extrinsic material. Unfortunately, the basis of reliance upon other provisions was not always explained; whilst the usefulness of some of…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2008] VSCA 273
Decision Date: 18 December 2008

CaseChat Overview and Summary

In the case of Alinta Asset Management Pty Ltd versus the Essential Services Commission, the appellant challenged the respondent's determination that it was a service provider under the Gas Pipelines Access (Victoria) Act 1998. The appellant, Alinta Asset Management, operates a gas distribution pipeline under an agreement with the owner. The dispute centred on whether this operation constituted providing services by means of a pipeline, as defined in section 22(1) of the Gas Industry Act 2001 (Vic), necessitating a licence. A secondary issue was whether the provision of such services required a contractual grant by the pipeline owner, lessee, or licensee.

The court was tasked with interpreting the statutory language and understanding the legislative intent behind the Gas Pipelines Access (Victoria) Act 1998. It needed to determine if the appellant's activities met the definition of providing services under section 22(1) of the Gas Industry Act 2001 (Vic). Furthermore, the court had to examine whether the provision of these services necessitated a contractual agreement, as opposed to being an operational activity under an agreement. The court also needed to decide if the appellant qualified as an operator under the Gas Pipelines Access (Victoria) Act 1998 and, consequently, a Service Provider subject to the Code.

The court applied a purposive approach to statutory construction, considering the context provided by the Hilmer Report, prior and related legislation, and the legislative intent. The court concluded that the appellant's operation of the gas distribution pipeline pursuant to an agreement with the owner did indeed constitute providing services by means of a pipeline. It was determined that such services required a licence under section 22(1) of the Gas Industry Act 2001 (Vic). Additionally, the court found that the provision of services did not necessarily need a contractual grant by the pipeline owner, lessee, or licensee. The court also held that the appellant qualified as an operator under the Gas Pipelines Access (Victoria) Act 1998 and, therefore, a Service Provider subject to the Code.

The appeal was dismissed, and the decision of the respondent was affirmed. The appellant was recognised as a Service Provider and subject to the obligations outlined in the National Third Party Access Code for Natural Gas Pipelines.

Orders