Alliance Craton Explorer Pty Ltd v Quasar Resources Pty Ltd & Heathgate Resources Pty Ltd (No 3) - [2011] SASC 171

SUPREME COURT OF SOUTH AUSTRALIA
(Civil)
ALLIANCE CRATON EXPLORER PTY LTD v QUASAR RESOURCES PTY LTD & HEATHGATE RESOURCES PTY LTD (NO 3)
[2011] SASC 171
Judgment of The Honourable Justice White
10 October 2011
LIMITATION OF ACTIONS - GENERAL MATTERS - AMENDMENT OF ORIGINATING PROCESSES AND PLEADINGS OUTSIDE LIMITATION PERIOD - AMENDMENT OF DEFENCE
EQUITY - GENERAL PRINCIPLES - RULES AND MAXIMS OF EQUITY - CLEAN HANDS
EQUITY - GENERAL PRINCIPLES - FIDUCIARY OBLIGATIONS - PARTICULAR CASES - JOINT VENTURER
CONTRACTS - GENERAL CONTRACTUAL PRINCIPLES - DISCHARGE, BREACH AND DEFENCES TO ACTION FOR BREACH
The first defendant (Quasar), and the second defendant (Heathgate) seek permission to amend their respective defences - Quasar also seeks to amend its Counterclaim - the plaintiff (Alliance) opposes some of the proposed amendments.
Whether the equitable defence of unclean hands requires a defendant to establish unconscionable conduct; whether the alleged conduct relied upon for the defences gives rise to an arguable immediate and necessary relationship with the equity upon which Alliance relies; whether the amended pleadings are otherwise deficient.
Held: permission to amend the defences, and Quasar's Counterclaim, is refused in part - the pleas invoking the equitable defence of unclean hands do not need to include material facts of conduct amounting to unconscionable conduct, however the defendants must plead facts giving rise to an arguable immediate and necessary nexus with the equity sued upon - other elements of the proposed amendments are deficient and should not be allowed.
Mining Act 1971 (SA) Pt 9B; Trade Practices Act 1974 (Cth) s 51AA, referred to.
Alliance Craton Explorer Pty Ltd v Quasar Resources Pty Ltd & Anor [2011] SASC 90; Alliance Craton Explorer Pty Ltd v Quasar Resources Pty Ltd & Anor (No 2); Quasar Resources Pty Ltd v The Mining Registrar & Anor [2011] SASC 92; Alliance Craton Explorer Pty Ltd v Quasar Resources Pty Ltd & Anor [2011] SASCFC 64; Australian Competition and Consumer Commission v CG Berbatis Holdings Pty Ltd (2003) 214 CLR 51; Meyers v Casey (1913) 17 CLR 90; FAI Insurances Ltd v Pioneer Concrete Services Ltd (1987) 15 NSWLR 552; Official Trustee in Bankruptcy v Tooheys Ltd (1993) 29 NSWLR 641; Coghlan v Pyoanee Pty Ltd (2003) 2 Qd R 636; Tanwar Enterprises Pty Ltd v Cauchi (2003) 217 CLR 315; Dewhirst v Edwards (1983) 1 NSWLR 34; H Stanke & Sons Pty Ltd v O'Meara (2007) 98 SASR 450; Liquor National Wholesale Pty Ltd v The Redrock Co Pty Ltd [2009] NSWSC 1418, considered.

ALLIANCE CRATON EXPLORER PTY LTD v QUASAR RESOURCES PTY LTD & HEATHGATE RESOURCES PTY LTD (NO 3)
[2011] SASC 171
Civil

WHITE J. This decision concerns applications by the defendants to amend their defences and in the case of the first defendant (Quasar) its Counterclaim.
The background to the proceedings is set out in previous decisions of the Court.[1] In summary, the plaintiff (Alliance) and Quasar are participants in a mining joint venture governed by a written contract (the JVA). By the JVA, Quasar was appointed manager of the joint venture. Because it had no employees, it contracted in turn with the second defendant (Heathgate) to carry out various tasks on its behalf.
[1] Alliance Craton Explorer Pty Ltd v Quasar Resources Pty Ltd & Anor [2011] SASC 90; Alliance Craton Explorer Pty Ltd v Quasar Resources Pty Ltd & Anor (No 2); Quasar Resources Pty Ltd v The Mining Registrar & Anor [2011] SASC 92; Alliance Craton Explorer Pty Ltd v Quasar Resources Pty Ltd [2011] SASCFC 64.
On 11 June 2009 Quasar and Heathgate entered into a Native Title Mining Agreement (the First NTMA) with the Adnymathanha Tradition Lands Association (ATLA). The Mining Registrar refused to register the First NTMA under Pt 9B of the Mining Act 1971 (SA), taking the view that as Quasar and Alliance were joint applicants for the grant of a mining lease, it was also necessary for Alliance to be a named party to the First NTMA. Quasar contends that Alliance had, by the terms of the JVA and in particular by cl 6.4, authorised it to enter into the First NTMA on its behalf.
Alliance contends that Quasar was not authorised by the JVA to enter into the First NTMA. Alliance also alleges that by executing the First NTMA, Quasar acted in breach of fiduciary duties and the contractual obligation of good faith which it alleges Quasar owed to it. In this way Alliance makes both equitable and common law claims. By way of relief, it seeks declarations as well as injunctions, damages and/or equitable compensation.
Alliance alleges that Heathgate was complicit in Quasar’s breaches.
Each of Quasar and Heathgate deny Alliance’s claims. Each also Counterclaims against Alliance. Quasar contends that Alliance has wrongly disputed its authority to enter into the First NTMA and otherwise delayed or failed to cooperate in steps necessary to pursue the joint venture. It claims damages and/or equitable compensation against Alliance. Heathgate claims that it is entitled to be indemnified by Alliance in respect of any amount which it becomes liable to pay as a result of Alliance’s claims. The entitlement to indemnity is said to arise from an earlier agreement between Alliance and Heathgate.
On 12 May 2010 Quasar and ATLA entered into another native title mining agreement (the Second NTMA). The Second NTMA is expressed to terminate and replace the First NTMA. Quasar has sought the registration of the Second NTMA. The Mining Registrar has refused registration.
On 12 August 2011 I gave Alliance permission to file a fourth statement of claim (4SC). At the same time, I gave Quasar and Heathgate permission to file amended defences responding to the amendments in 4SC.
By its 4SC Alliance contends that the JVA did not authorise Quasar’s entry into the Second NTMA. It alleges that, by entering into the Second NTMA, Quasar breached the fiduciary duties and the implied contractual obligation of good faith which it alleges Quasar owed to it. Thus Alliance also makes both equitable and common law claims in relation to the Second NTMA.
Quasar and Heathgate did not file their amended defences within the required time. They now seek permission to amend their respective defences so as to respond to the 4SC. Quasar also seeks permission to amend its Counterclaim. Alliance opposes some of the proposed amendments.
I proceed on the basis that subject to a proposed pleading containing a plea of all the necessary material facts, otherwise being in a proper form, and timely, an amendment which discloses a reasonably arguable ground of defence will ordinarily be allowed. Some of the qualifications which I have just mentioned are important in the consideration of the defendants’ present applications.
Quasar’s Proposed Pleadings
Except when it is necessary to do otherwise, I will refer only to those amendments which are in dispute. Because of the form of Quasar’s pleading, it is difficult to do this in a defined and discrete way. Even taking a benign view, Quasar’s proposed fourth defence and Counterclaim (4D–CC) is not an example of felicitous drafting: it makes extensive use of the technique of cross-referencing, including by cross referencing to and from its Counterclaim, and in some cases by mounting cross reference upon cross reference; in other cases, cross referencing is made to the whole of another paragraph without any identification of the particular pleas in those paragraphs which are pertinent to the plea being particularised, and at least one paragraph appears to be in the nature of a general repository of pleas to which Quasar makes resort as and when required for other paragraphs. These features of the pleading add to its complexity. Overall, is it is a difficult pleading with which to work.
The Defence of Unclean Hands
It is convenient to consider first the objection which Alliance makes to the defendants’ proposed pleas raising the equitable defence of unclean hands.
As previously noted, Alliance makes both equitable and common law claims. The defence of unclean hands is available in relation to the former.
Alliance’s Claim of Breach of Fiduciary Duty
The defence of unclean hands which Quasar and Heathgate wish to raise arises from Alliance’s allegation of a breach of fiduciary duty by Quasar (in which it is also said Heathgate was a knowing participant) and is pleaded in 4SC [73]. Alliance pleads that Quasar entered into the First NTMA on terms which were not in the best interests of Alliance or the Joint Venture [73.1]), and that by reason of their association and common ownership, Quasar and Heathgate had a common interest in the matters giving rise to the disadvantage ([73.2]). It then pleads (in [74.3]) that in agreeing to the disadvantageous terms:
Quasar acted in a position of conflict between its own interests and those of Heathgate on the one hand, and the interests of Alliance and the Joint Venture on the other, without seeking or obtaining Alliance’s consent. Indeed, Quasar chose to avoid informing Alliance about any of the terms of the NTMA before it was signed.
The gravamen of this plea appears to be that in entering into the First NTMA, Quasar was affected by a conflict of interest and yet had done so without seeking or obtaining Alliance’s consent. Alliance does make the further allegation that Quasar made a positive decision not to inform Alliance about any of the terms of the First NTMA before it was executed, but this does not seem to alter the substance of the complaint of breach of fiduciary duty, ie, that Quasar had preferred its own interests, and those of Heathgate, to those of Alliance and the joint venture, without first having sought or obtained Alliance’s consent.
Alliance’s allegations in relation to the Second NTMA are similar. It alleges that the terms of the Second NTMA favour Quasar by providing benefits to it but not to Alliance. It is not necessary presently to particularise the respects in which Alliance says that this is so. Alliance alleges that Quasar acted in conflict between its own interests, on the one hand, and the interests of Alliance and the joint venture, on the other, without seeking or obtaining Alliance’s consent. Again, Alliance makes the allegation that Quasar had chosen to avoid informing it about any of the terms of the Second NTMA before it was signed.
Paragraphs [78A] and [82]
It is in relation to these pleas that Quasar and Heathgate wish to raise the defence of unclean hands proposed in their respective 4D-CCs ([82] and [78A] respectively). Heathgate pleads in [78A]:
In further answer to paragraph 78 of the Statement of Claim, and in opposition to the grant of any equitable or discretionary relief to Alliance, Heathgate says that the conduct of Alliance and the other matters referred to in (a) to (g) below disentitles Alliance to the equitable or discretionary relief it claims against Heathgate, by operation of the equitable doctrine of unclean hands.
I will refer to sub-paragraphs (a) to (g) below.
Paragraph 82 of the Quasar 4D-CC is as follows:
Denies that Alliance is entitled to the relief sought in Part 2 of the Claim, or any relief whatsoever and says further that Alliance should be denied the relief it seeks in Part 2 paragraphs 3, 4, 4B and 6 in the exercise of the Court’s discretion by reason that Alliance has unclean hands such that the Court ought deny Alliance the equitable relief that it seeks by reason of the conduct set out in paragraphs 74.3(g), 74.3(k), and 74.3(n) and 76CC of this Defence and paragraphs 3 and 4 in the Counterclaim, which constituted breaches of its express and implied contractual duties, as set out in paragraph 76CC(k).
Alliance made its submissions challenging these pleas by reference in the first instance to [78A] in the Heathgate defence. It is convenient in these reasons to do likewise.
Heathgate’s Unclean Hands Defence
Heathgate pleads that “the conduct” of Alliance and “the other matters referred to in (a)-(g)” disentitled Alliance to equitable or discretionary relief. Counsel for Heathgate made it plain that the conduct and matters upon which Heathgate relies for this plea are those matters pleaded in sub-pars (a) to (g), and those matters only.[2]
[2] T26/9/11, pp 59-60.
The matters pleaded in [78A(a)-(g)] match, for relevant purposes, those of Quasar in [76CC(a), (b), (c), (d), (e), (g) and (j)]) of its 4D-CC. By these paragraphs, Quasar and Heathgate plead that in four separate conversations in the period between November 2008 and February 2009, an employee or agent of Alliance had expressed Alliance’s dissatisfaction with existing arrangements under the JVA and had foreshadowed (on one characterisation, threatened) obstruction (including by the commencement of litigation) to the progress towards mining on the joint venture tenement unless Quasar agreed to some alteration of the arrangements under the JVA in Alliance’s favour.
Next, Quasar and Heathgate plead in unison the conduct of Alliance in stating its refusal to attend or participate in another management committee meeting after 21 April 2009 unless, despite a valid ruling of the Chairman and the committee itself, it (Alliance) was permitted to tape record the meetings. They plead that Alliance evidenced that refusal by walking out of the joint venture management committee meeting on 21 April 2011 and ([76CC(g)] and [78A(e)] respectively). This is in substance a plea of obstructive conduct. I note however that neither Heathgate nor Quasar plead facts suggesting that any obstruction or delay was occasioned by Alliance’s conduct on 21 April 2009.
Heathgate then pleads (again in similar terms to Quasar [78CC(i)]) that Alliance’s purpose in acting in the ways alleged in [78A(a)-(e)] inclusive was to try to pressure Quasar into renegotiating the terms of the JVA in its favour and to try to obtain a collateral commercial benefit (in Alliance’s own right, rather than for the joint venture) which was unrelated to the registration of any native title mining agreement ([78A(f)]).
Finally, Heathgate pleads in similar terms to Quasar’s [76CC(j)] that Alliance would have raised an objection to the form of the NTMA it negotiated, no matter what form that agreement took ([78A(g)]).
Alliance made two challenges to this pleading. The first was that neither defendant had pleaded matters which could, if established at trial, be characterised as constituting unconscionable conduct on its part. The second was that the defendants have not pleaded matters giving rise to an arguable ‘immediate and necessary relationship” between its alleged conduct and the equity upon which it sues.
Unconscionable Conduct
The elements of Alliance’s argument appeared to be these: it is a necessary element of an offence of unclean hands for the defendant to establish unconscionable conduct in the equitable sense by the claimant; that in substance Heathgate was alleging that Alliance’s purpose, as pleaded, made its conduct unconscionable; the decision of the High Court in Australian Competition and Consumer Commission v CG Berbatis Holdings Pty Ltd[3] indicated that so long as one party to a contract is not in a position of special disadvantage in relation to the other, it is not unconscionable for a party in a superior position to take advantage of its commercial or strategic position in order to obtain an advantage at the expense of the other; and that the allegation that Alliance had sought to exploit its commercial position for its own advantage could not thereby give rise to any unconscionability of the requisite kind.
[3] [2003] HCA 18; (2003) 214 CLR 51.
Alliance referred to only two authorities for the proposition that a party raising a defence of unclean hands had to establish unconscionable conduct by the other. The first was Meyers v Casey[4] in which Isaacs J refused to uphold a defence of unclean hands, saying that the circumstances before the court were:
… altogether different from the cases where the right relied on, and which the Court of Equity is asked to protect or assist, is itself to some extent brought into existence or induced by some illegal or unconscionable conduct of the plaintiff, so that protection for what he claims involves protection for his own wrong. No Court of Equity will aid a man to derive advantage from his own wrong, and this is really the meaning of the maxim.[5]
(Emphasis added)
[4] (1913) 17 CLR 90.
[5] Ibid at 124.
The second authority referred to by Alliance was FAI Insurances Ltd v Pioneer Concrete Services Ltd[6] in which Young J, during the course of a review of the authorities, cited the quoted passage from Meyers v Casey.
[6] (1987) 15 NSWLR 552.
On the other hand, a requirement for conduct of an unconscionable kind to be established as a condition of the equitable defence of unclean hands does not appear in many of the leading authorities and texts concerning the defence. Instead, the authorities emphasise that there must be improper or wrongful or unconscientious conduct which has an immediate and necessary relationship with the equity sued upon.[7]
[7] Meyers v Casey (1913) 17 CLR 90 at 123; Official Trustee in Bankruptcy v Tooheys Ltd (1993) 29 NSWLR 641 at 650 (Gleeson CJ); Coghlan v Pyoanee Pty Ltd [2003] QCA 146; (2003) 2 Qd R 636 at 643.
Alliance relied on the decision in Berbatis. It is not necessary for present purposes to address that decision in any detail.
It is to be remembered that the notion of unconscionable conduct does not have a fixed and invariable content in equity. It varies according to context. The conduct of a person may be unconscionable for some purposes, but not for others. The decision in Berbatis concerned the contractual relationship between landlord and tenant in a commercial setting. It would be unsound, in my opinion, to conclude that the High Court’s discussion of the concept of unconscionability under s 51AA of the Trade Practices Act 1974 (Cth) in such a setting is necessarily applicable to all contexts in which unconscionable or unconscientious conduct is considered.
The observations of the majority in Tanwar Enterprises Pty Ltd v Cauchi[8] are pertinent in this context:
The terms "unconscientious" and "unconscionable" are, as was emphasised in Australian Competition and Consumer Commission v C G Berbatis Holdings Pty Ltd, used across a broad range of the equity jurisdiction. They describe in their various applications the formation and instruction of conscience by reference to well developed principles. Thus, it may be said that breaches of trust and abuses of fiduciary position manifest unconscientious conduct; but whether a particular case amounts to a breach of trust or abuse of fiduciary duty is determined by reference to well developed principles, both specific and flexible in character. It is to those principles that the court has first regard rather than entering into the case at that higher level of abstraction involved in notions of unconscientious conduct in some loose sense where all principles are at large.[9]
(Citation omitted)
Later, the majority said:
[T]he phrase “unconscionable conduct” tends to mislead in several respects.
First, it encourages the false notions that (i) there is a distinct cause of action, akin to an equitable tort, wherever a plaintiff points to conduct which merits the epithet "unconscionable"; and (ii) there is an equitable defence to the assertion of any legal right, whether by action to recover a debt or damages in tort or for breach of contract, where in the circumstances it has become unconscionable for the plaintiff to rely on that legal right.[10]
(Citation omitted)
[8] [2003] HCA 57; (2003) 217 CLR 315.
[9] Ibid at [20]; 324.
[10] Ibid at [23]-[24].

These matters are sufficient to indicate, in my opinion, that the first limb of Alliance’s attack on the pleaded defence of unclean hands cannot be sustained.
The Requisite Nexus
In the second limb of its argument concerning [78A] in the Heathgate defence and [82] in the Quasar defence, Alliance argued that the matters relied upon by each defendant did not raise an arguable “immediate and necessary relation to the equity sued upon”. Wrongful conduct by a claimant, irrespective of its quality and connection with the asserted entitlement, will not give rise to the defence in absence of such a nexus. “Naughtiness” or general depravity is insufficient.
As Isaacs J indicated in Meyers v Casey in the passage previously quoted the defence is available in circumstances in which the right which the Court of Equity is asked to protect or assist is itself to some extent brought into existence or induced by illegal or unconscionable conduct of the plaintiff, so that protection for what it claims involves protection for its own wrong.[11] To similar effect in FAI Insurances Ltd v Pioneer Concrete Services Ltd,[12] Young J said:
[I]t is only if the right being sought to be vindicated by the plaintiff in a court of equity is one which, if protected, would mean the plaintiff was taking advantage of his own wrong, that the court will either debar him from relief or perhaps say he is not a proper plaintiff in a representative suit.[13]
[11] (1913) 17 CLR 90 at 124.
[12] (1987) 15 NSWLR 552 at 561.
[13] Ibid at 561.
Counsel for Heathgate referred to Official Trustee in Bankruptcy v Tooheys Ltd.[14] In that case, the tenants had by fraudulent misrepresentations induced Tooheys to grant a lease of a hotel to them. Later, Tooheys purported unilaterally to alter the basis upon which it would approve a transfer of the lease. This was to the disadvantage of the tenants. The Court of Appeal in New South Wales held that Tooheys was not estopped from failing to honour its representations as to transfer of the hotel lease by reason of the fraudulent misrepresentations which had induced Tooheys to grant the lease in the first place. Gleeson CJ, with whom Meagher and Sheller JJA agreed, would have reached the same result by application of the defence of unclean hands:
The alternative way of looking at the matter is by reference to the principle that he who comes to equity must come with clean hands. … The unmeritorious conduct which debars relief is not “general depravity”; it must be conduct which has “an immediate and necessary relation to the equity suited for” … On that test, the present case is one in which the relationship between the false representations and the equity sued upon is sufficiently close to establish the defence. There is a clear and close connection between the misrepresentations made to Tooheys and Tooheys’ willingness to participate in the transaction out of which the alleged estoppel arose.[15]
(Citations Omitted)
[14] (1993) 29 NSWLR 614.
[15] Ibid at 650.
Of course, the circumstances described in these authorities are not the only circumstances in which the defence is available. An example of the Court upholding a defence of unclean hands because of the plaintiff’s conduct in the course of a joint venture is seen in Liquor National Wholesale Pty Ltd v The Redrock Co Pty Ltd.[16] In that case Hammerschlag J found that the plaintiffs unmeritorious course of conduct which had brought a joint venture to an end had an immediate and necessary relationship with the equity sued upon in the case, namely, the claim that a receiver should be appointed to take possession of the joint venture assets.
[16] [2009] NSWSC 1418.
Nevertheless, the requirement for an immediate and necessary relationship with the equity sued upon does serve to emphasise the limited availability of the defence.
Accordingly, consideration of the arguablity of the proposed defences requires at the outset an identification of the nature of the equity which Alliance seeks to enforce. As previously noted, it is Quasar’s breach of fiduciary duty, while in a position of conflict of interest, in acting to the disadvantage of Alliance and the joint venture and to the benefit of Heathgate and itself, which is the basis of Alliance’s equitable claim in relation to each of the NTMAs. It is Heathgate’s knowing participation in Quasar’s breach upon which Alliance relies in relation to the First NTMA.
Alliance’s pleas of those breaches are of course allegations only at this stage. However, for the purposes of considering the arguablity of the proposed defences of unclean hands, it is appropriate to proceed on the hypothesis that the alleged breaches are established because, in the circumstances of the present case, it will only be then that the Court will have to consider the proposed defences.
The question on the amendment applications is really that of whether it is reasonably arguable that the conduct of Alliance pleaded by Quasar and Heathgate has “an immediate and necessary relationship” with Alliance’s equity to restrain Quasar from acting in relation to the two native title mining agreements (with Heathgate’s knowing participation in relation to the first) in a way which prefers its own interest to those of Alliance and the joint venture. I have summarised above the conduct of Alliance which Heathgate relies upon for this purpose.
For the reasons I give below, I consider that Alliance’s equity in having Quasar conduct itself in the affairs of the joint venture unaffected by a conflict of interest and, without its consent, not preferring its own interests and those of Heathgate to those of the joint venture does not have its origins in the conduct pleaded by Heathgate or Quasar for the defence of unclean hands. On the hypothesis that the fiduciary duty alleged by Alliance does exist, it will have arisen from the joint venture relationship itself and Quasar’s position of power and influence in that relationship. A breach of that duty, if it exists, will arise from the terms of the NTMAs into which Quasar entered. It is not suggested that it was conduct of Alliance which induced the particular terms of the NTMAs which Alliance alleges constitute the breaches of fiduciary duty. Thus Alliance will not be asking the Court to enforce a right which was “brought into existence or induced by some illegal or unconscionable conduct” of Alliance.
Counsel for Heathgate submitted that it was Alliance’s own conduct which led to the state of affairs of which it complains in the proceedings, in particular, its not having been named as a party to the First NTMA, and not being involved in its negotiation. However, even if that be so, there remains a difficulty of showing the necessary nexus. Alliance’s conduct may explain why Quasar and Heathgate did not seek its consent, but it is not easy to see that there is a nexus between that conduct and Quasar and Heathgate then proceeding, in the absence of Alliance’s consent, to enter into an agreement which preferred their own interests to the disadvantage of Alliance and the joint venture. Even on the view of Quasar’s authority under the JVA which Quasar and Heathgate plead they took, and even if there was a sound justification for that view, Quasar remained bound (on the assumed hypothesis) not to prefer its own interests to those of Alliance and the joint venture.
I remind myself that on an amendment application Quasar and Heathgate have to surmount a relatively low threshold only, namely, of showing that the proposed defence is reasonably arguable. However, I am unable to conclude that the matters pleaded by Heathgate do meet that threshhold.
Quasar’s Unclean Hands Defence
Quasar’s plea of unclean hands is more broadly based than that of Heathgate. In addition to those pleas which were, in material respects, matched by Heathgate, Quasar relies on a number of other matters which it alleges constituted breaches of Alliance’s contractual duties. Some of those matters by themselves cannot reasonably be regarded as a particular of conduct amounting to unclean hands, but I accept that they may draw some colour and significance from the other pleaded matters.
First, Quasar relies on its plea in [74.3(g)] that Alliance was aware that the Mining Registrar had previously accepted that Pt 9B of the Mining Act did not require Alliance to be a party to a native title mining agreement entered into by Quasar on behalf of the joint venture. Of itself, this cannot be conduct amounting to unclean hands or for that matter a breach of contractual duty, but the asserted knowledge may be capable of giving other conduct a significance which would otherwise be lacking.
Secondly, Quasar relies on its plea in [74.3(k)] that Alliance had received legal advice (said by Quasar to be accurate legal advice) to the effect that the Mining Act did not require Alliance to be a party to a native title mining agreement entered into by Quasar on behalf of the joint venture, and to the effect that the Mining Act did not require that each tenement holder be a party to a native title mining agreement if the operator/manager was not the sole registered holder of the relevant tenement. Quasar also pleads that Alliance had been advised that this was the consistent view and approach of the mining industry and the private legal sector. Quasar alleges as part of this plea that Alliance itself believed those same matters.
As will be seen below, I consider that there are a number of difficulties with Quasar’s [74.3(k)] which mean that it should be disallowed. For present purposes, however, it is difficult to see how the plea in [74.3(k)] has any immediate or necessary relationship with Alliance’s enforcement of its equity in its co-joint venturer not acting, while in a position of conflict of interest, to its own advantage (and in the case of the First NTMA to that of Heathgate) and to the detriment of Alliance and the joint venture. On the contrary, on the assumption that Alliance did have such legal advice, it would seem only to add to Alliance’s interest in Quasar avoiding the conflict. I also note that Quasar does not plead that Alliance had, before it (Quasar) entered into the First NTMA, asserted that it (Alliance) should be a party to any NTMA. The plea in [76CC(g)] of 4D-CC and [4(b)] of the Counterclaim is that Alliance made that assertion only after the execution of the First NTMA.[17]
[17] The plea in [74.4(b)] is possibly inconsistent with [76CC(g)] and [4(b)].
Next, by its cross reference in [82] to [74.3(n)] Quasar pleads that by reason of the matters set out in the preceding 13 sub-paragraphs of [74.3]:
[I]t was in the interests of the Joint Venture, and there was a proper basis, for Quasar not ultimately seeking Alliance’s consent to, or execution of, the NTMA, in circumstances where Alliance had threatened to, and had, engaged in obstructive behaviour (including by refusing its signature or approval to documents and disputing rulings and resolutions of the Joint Venture Management Committee) unless Quasar acceded to demands made by Alliance in pursuit of Alliance’s own collateral and self-interests.
The first and most immediate point to note about [74.3(n)] is that it is not a plea of conduct by Alliance at all. Instead it is a plea that Quasar was justified in not seeking Alliance’s consent to the First NTMA, and in not having Alliance execute the First NTMA.
By its cross reference to [74.3(n)], Quasar seeks to incorporate as part of its equitable defence of unclean hands a substantive portion of its defence to part of Alliance’s claim of breach of contract, namely, that without a proper basis and for no proper purpose, it had disregarded legal advice to the effect that Alliance should be a named party to the NTMA and kept informed about its drafting. This aspect of Quasar’s pleading tends to point up the difficulty of finding an arguable immediate and necessary relationship with the equity raised by Alliance’s equitable claim. Quasar’s plea in [74.3(n)] goes to the basis upon which it entered into the First NTMA without Alliance also being a party and without Alliance’s consent, but not to Alliance’s plea that, having acted in that way, Quasar then preferred the interests of Heathgate and itself, to the detriment of Alliance and the joint venture. Even if Alliance’s conduct did justify Quasar’s decision not to have Alliance as a party to the NTMA or to consult it regarding the terms of the NTMA, it is not easy to see an arguable necessary relationship between Alliance’s conduct, on the one hand, and Alliance’s equity in Quasar not acting in a self-interested manner, on the other.
For this additional reason, [74.3(n)] is not to be regarded, in my opinion, as pleading a matter giving rise to an arguable immediate and necessary relationship with the equity upon which Alliance sues.
I note that to the extent that the plea in [74.3(n)] does refer to certain conduct of Alliance, that conduct is particularised elsewhere in Quasar’s 4D-CC. Accordingly, when necessary and appropriate for the 4D-CC to do so, cross reference can be made directly to those particulars, without doing so through the medium of [74.3(n)].
Next, proposed [82] in Quasar’s 4D-CC incorporates by reference the conduct of Quasar pleaded in [76CC] which constituted breaches of the express and implied contractual duties set out in proposed [76CC(k)].
Quasar’s cross reference in [82] to [76CC] creates difficulties because, for the purposes of [82], Quasar relies on those sub-paragraphs of [76CC] alleging matters which constitute breaches of contract, without identifying those sub-paragraphs.
When considering Heathgate’s plea of unclean hands, I referred to the counterpart pleadings in Quasar’s [76CC]. However, [76CC] contains numerous pleas for which [78A] in the Heathgate 4D-CC does not have a counterpart. In what follows I refer only to the pleas in [76CC] which do not have a counterpart in Heathgate’s [78A].
First, Quasar pleads conduct by Alliance at joint venture management committee meetings in November 2008 in objecting to the ruling of the Chairman that the meetings not be tape recorded and objecting to, and declining to vote upon, work programs and budgets for the commencement of mining operations ([76CC(aa)]). In substance this is a plea of obstructive conduct by Alliance.
Next, Quasar pleads that by letters dated 9 and 19 December 2008 Alliance wrongfully asserted that work programs and budgets were contrary to the terms of the JVA and had not been approved by the joint venture management committee ([76CC(ab)]). Again, this seems to be a plea of obstructive conduct.
I note that Quasar and Heathgate do not plead that any obstruction or delay was occasioned by Alliance’s conduct at the meetings in November and December 2008.
In proposed [76CC(e)] Quasar pleads that during 2009 Alliance was approached by, and had preliminary discussions with, various potential buyers about selling its interest in the joint venture and/or its notional share of the uranium to be produced from the mine. However, Quasar does not plead any matter to indicate that Alliance’s preliminary discussions with potential buyers constituted a breach of its express and implied contractual duties as set out in [76CC(k)] or in [2] and [2A] of its Counterclaim. I consider that it can be disregarded for present purposes.
A similar point can be made in relation to proposed [76CC(f)]. It pleads that Alliance sent Quasar a proposed form of mining joint venture agreement containing a term which would favour Alliance. There is no plea of any material facts to indicate that this alleged conduct could constitute a breach of Alliance’s contractual duties. At best is appears to be an impermissible plea of evidence to support the course of conduct and purpose of Alliance which Quasar alleges.
The next additional plea of Quasar is that made in [76CC(ga)]. The allegation is that from June 2009 Alliance, in both correspondence to, and meetings with, the Mining Registrar and PIRSA, objected to the registration of the First NTMA and asserted, contrary to the fact and Alliance’s own legal advice, that Pt 9B of the Mining Act required that Alliance be a party to the First NTMA and that Quasar was not authorised to enter into that NTMA by the JVA. There are difficulties with this plea to which I will refer below. However, for present purposes, I note that the conduct alleged by Quasar post-dates the entry into the First NTMA. For this reason alone it is difficult to regard it as raising an arguable basis for a defence of unclean hands in relation to the breach of fiduciary duty alleged by Alliance in relation to the First NTMA.
Next, Quasar raises (by [76CC(h)]) a plea that in July 2009 Alliance attempted to involve itself in one aspect of the regulatory approval process when it had no right to do so. This alleged conduct also post-dated the entry into the First NTMA, and, again, it is difficult to regard it as regarding an arguable basis for a defence of unclean hands in relation to the First NTMA.
Insofar as the pleas in [76CC(ga) and (h)] may be relied upon in relation to the Second NTMA, it is difficult to see an arguable basis upon which they can do so. On their face, neither the matters referred to in each of these pleas appears to have any relationship at all with the equity which Alliance seeks to enforce.
Finally, in [82] Quasar seeks to incorporate by reference the conduct pleaded in proposed [3] and [4] in its Counterclaim which constituted breaches of contract pleaded in [76CC(k)]. This is an example of cross referencing both into and out of the Counterclaim.
Paragraphs [3] and [4] of the proposed Counterclaim raise an amalgam of pleas, several of which refer to conduct of Alliance after the execution of the two NTMAs. Quasar’s claim, expressed very broadly, is that Alliance was in breach of contract in raising disputes, in challenging Quasar’s authority to enter into the First NTMA, and in failing to facilitate the registration of each of the NTMAs. In this way Quasar relies on matters which occurred only after the dispute which is the subject of the present litigation had arisen only after Quasar and Heathgate had lodged the First NTMA with the Mining Registrar for registration.
Quasar’s reliance on conduct occurring after the execution of the First NTMA in June 2009 has two consequences. First, there is the difficulty previously mentioned in relying for the defence of unclean hands on conduct which post-dates the event giving rise to the equity sought to be enforced. Secondly, on the hypothesis on which the arguability of the defence of unclean hands must be considered, Alliance’s claim that Quasar breached its fiduciary duty in relation to the First NTMA (and separately the Second NTMA) will have been vindicated. The conduct of Alliance of which Quasar complains in the Counterclaim will have to be considered in that light. Much of the conduct for which Quasar relies in the Counterclaim will then have to be considered as the conduct of a party resisting an infringement of its rights. To my mind this is material to the arguability of the pleaded defence of unclean hands. Quasar’s pleading seems to overlook this consideration.
The reasoning set out above which indicates an absence of an arguable immediate and necessary relationship between the impugned conduct of Alliance, and the equity upon which it sues, is also pertinent.
There are some aspects of the Counterclaim (for example some parts [4(a)] and [4(d)] which relate to the period between November 2008 and the execution of the First NTMA. I do not propose to detail that conduct in these reasons. For the reasons previously given, in relation to other conduct of a like kind, I consider that the pleading does not indicate a reasonably arguable necessary and immediate relationship between the impugned conduct and the equity which Alliance seeks to enforce.
Summary on Unclean Hands Defence

In summary, I consider that Alliance’s challenge to the respective pleas of unclean hands should succeed. The effect is that neither Quasar nor Heathgate should be given permission to include [82] and [78A] in their respective defences, nor any of the pleadings incorporated by cross reference into those paragraphs which are not otherwise proper pleas.
Paragraph 74.3(k) in the Quasar Defence
I now turn to Alliance’s remaining objections to each defendant’s proposed amendments. It is convenient to deal first with the objections to Quasar’s 4D‑CC.
Paragraph 74 of 4SC contains Alliance’s allegation that Quasar acted in breach of its duty of good faith in executing the First NTMA. Paragraph 74.3 is one particular of that allegation. Alliance alleges that Quasar received legal advice as to the need for it (Alliance) to be a named party to the NTMA and of the desirability of keeping Alliance informed of the drafting process. Alliance then alleges that Quasar disregarded that legal advice without any proper basis, and without there being a proper purpose for the joint venture to do so. Alliance relies in this respect on advice rendered to Quasar by the firm McDonald Steed McGrath on 16 September 2008 and 7 October 2008 (some nine and eight months respectively before the execution of the First NTMA).
The defence to that plea in Quasar’s 4D-CC comprises four pages (without the paragraphs incorporated by cross-reference).
Paragraph 74.3(k) which I addressed n relation to the defence of unclean hands is part of that response. Quasar wishes to plead that Alliance had itself received legal advice to the effect, and that it believed, that the Mining Act did not require that each tenement holder be a party to a native title mining agreement entered into by an operator/manager who was not the sole registered holder of the relevant tenement, and that this was the consistent view and approach of the mining industry and the private legal sector. Quasar also wishes to plead that Alliance believed that the legal advice which it had received to the effect just described was accurate.
Quasar particularises its claim that Alliance had received the legal advice to the effect alleged by referring to the contents of an “Alert Memo” said to have been published in February 2011, of which it said a legal practitioner advising Alliance was one of the two authors, and to the contents of a Mining Weekly On‑line article dated 3 May 2011. Quasar also particularises its claim that Alliance had received legal advice to the alleged effect by cross-reference to earlier pleas [40.1]-[40.9] and [74.3(g)] to which I shall return shortly.
I consider that Quasar should not be permitted to plead [74.3(k)] in response to 4SC [74.3]. On the basis of the material facts pleaded by Quasar, its proposed plea as to the legal advice which Alliance had received cannot be a defence to the allegation that it (Quasar) had disregarded its own separate legal advice without any proper basis and without there being a proper purpose for the joint venture in doing so.
There are some other difficulties with the pleading. These include inadequacies in the particulars for the plea that Alliance had received legal advice to the effect alleged. As noted, Quasar pleads first the contents of an “Alert Memo” published by the firm of Finlaysons in February 2011. This was more than two and a half years after Quasar had entered into the First NTMA. Quasar seeks to overcome that difficulty by the further allegation that Alliance was advised “at all material times” by one of the two authors of the Finlaysons’ Alert Memo. There is however no particularisation of the expression “at all material times”, nor is there any other plea of material facts to support this aspect of the plea. Apart from anything else there is no pleading, supported by a plea of material facts, that Alliance had retained either Finlaysons or the author concerned to give advice in relation to the JVA at all, let alone as to the requirements in the Mining Act concerning the proper parties to a native title mining agreement.
Quasar also pleads that the conclusion that Alliance received legal advice to the effect alleged is to be inferred from the contents of a Mining Weekly On-line article dated 3 May 2011. The date of that article is just on three years after the entry into the First NTMA. Its author is unspecified. Again there is no pleading of any material facts to indicate some link between the publication of the article, on the one hand, and the plea that at some unidentified antecedent time Alliance had received legal advice to the effect pleaded, on the other.
Finally, Quasar seeks to support the plea that Alliance had received legal advice to the effect alleged by cross-reference to [40.1]-[40.9] and [ 74.3(g)] of 4D-CC. However, those paragraphs cannot reasonably be regarded as particulars in support of the allegation made in [74.3(k)]. The pleas in [40.1]-[40.9] inclusive concern the negotiation and completion of a Work Area Clearance Agreement (the WAC Agreement) in 2006. They do not contain any plea concerning legal advice sought by, or given to, or communicated to Alliance, let alone the subject matter of such advice.
Similarly, Quasar’s reliance on [74.3(g)] is of no assistance as a particular of an allegation that Alliance had received the alleged legal advice. By that plea, Quasar alleges that Alliance was aware that the Mining Registrar had previously taken the decision that Pt 9B of the Mining Act did not require Alliance to be a party to a native title mining agreement entered into by Quasar on behalf of the joint venture, and that Quasar was aware that Alliance had that knowledge. That paragraph (at least without a plea of several more material facts) cannot reasonably be understood as supporting a plea that Alliance had received legal advice to the effect pleaded in [74.3(k)].
Paragraphs which Contain Cross-Referencing to [74.3(k)]
Quasar submitted that proposed [74.3(k)] should be retained because it made use of the pleading, by cross-reference, in two other paragraphs of its 4D-CC.
Paragraph74.3(n)
For convenience, I quote again proposed [74.3(n)]:
By reason of the matters set out in [74.3(a)-(m)] it was in the interests of the Joint Venture, and there was a proper basis, for Quasar not ultimately seeking Alliance’s consent to, or execution of, the NTMA, in circumstances where Alliance had threatened to, and had, engaged in obstructive behaviour (including by refusing its signature or approval to documents and disputing rulings and resolutions of the Joint Venture Management Committee) unless Quasar acceded to demands made by Alliance in pursuit of Alliance’s own collateral and self-interests.
Quasar provides particulars of that allegation which included indirect reference to [74.3(k)].
In my opinion, the proposed [74.3(n)] does not justify the retention of [74.3(k)]. In the first place, if [74.3(k)] is not itself a proper pleading, it should not be permitted to stand as a particular of some other plea. Secondly, it is not easy to see how the plea in [74.3(k)] can be characterised as a particular of the allegation in [74.3(n)]. Thirdly, insofar as Quasar relies on the content of proposed [74.3(k)] in justification in a subjective sense for its own conduct, the plea is inappropriate as Quasar does not anywhere plead that it had knowledge, at any relevant time, of the legal advice which Alliance had received. Insofar as Quasar relies on [74.3(k)] as part of an objective justification for its conduct, that too seems misplaced. The material consideration in that respect will not be the receipt by Alliance of legal advice, but the correctness of the advice which Quasar itself received.
Paragraph 82
Because I will not grant permission to Quasar to include [82] to plead a defence of unclean hands, it is not necessary to consider this cross reference.
Conclusion on [74.3(k)]
I refuse permission to Quasar to amend its defence to include [74.3(k)]. That plea should be deleted from the amendment, as should all the cross-references to it.
My ruling in relation to [74.3(k)] also means that those portions of [76CC(ga)] which refer to legal advice which Alliance had received are disallowed.
Paragraph 76CC in the Quasar Defence
Proposed [76CC] is part of Quasar’s response to Alliance’s pleas of its breach of fiduciary duty and breach of its duty of good faith in the execution of both the First and Second NTMAs. It is a long plea which extends for more than three pages in the 4D-CC. It is a repository of pleas to which Quasar refers by cross reference in a number of other paragraphs in 4D-CC.
Although I referred to aspects of [76CC] in relation to proposed [82] above, I will summarise it, in very general terms, in the following way.
Four of its sub-paragraphs plead statements by Alliance personnel to the effect, or from which it may be inferred, that Alliance regarded the terms of the JVA as unsatisfactory, and that it intended to use such opportunities as were available to it to improve its position in the joint venture. To this end, it signalled that it was willing to obstruct progress towards mining, including by obstructing the obtaining of the necessary regulatory approvals and by commencing litigation (sub-pars (a), (b), (c) and (d)).
Four of the sub-paragraphs plead actual conduct of Alliance in relation to the management of the JVA which is said to be have been obstructive (sub-pars (aa), (ab), (g), (ga)). One sub-paragraph pleads that Alliance had been approached by potential buyers about selling its interest in the joint venture and/or its notional share of the uranium to be produced from mining the joint ventures tenement (sub-par (e)). One sub-paragraph pleads that Alliance had proposed a form of Mining Joint Venture Agreement which would be advantageous to it (sub-par (f)), and one pleads that Alliance attempted to involve itself in one regulatory approval process when it was not part of its responsibility to do so (sub-par (h)).
I note that these 11 sub-paragraphs plead events occurring both before and after the execution of the First NTMA.
Proposed [76CC] then concludes with three further pleas. The first is a plea of Alliance’s purpose in undertaking some of the conduct particularised earlier in [76CC] (sub-par (i)). Quasar alleges that Alliance’s purpose in making the statements in (a),(b), (d), (e), and (f) was to try to pressure Quasar to re-negotiate the JVA in its favour and to obtain for itself a collateral commercial benefit in its own right (sub-par (i)). Quasar adds to this plea a cross-reference to conduct of Alliance pleaded in its Counterclaim, but does not particularise the conduct to which it refers. This creates uncertainty and the plea in this form should not stand.
The second is a plea that it can be inferred from the first 11 particularised matters, and from Alliance’s purpose as pleaded in sub-par (i), that Alliance would have objected, no matter what form each of the First and Second NTMAs had taken (sub-par j). In the same sentence Quasar makes a quite separate and distinct plea of conduct of Alliance, namely that it has refused to agree to the registration of an NTMA unless and until Quasar agreed to enter into a form of deed poll pleaded by Quasar earlier in its defence, and to re-negotiate the terms of the JVA. This manner of pleading does not comply with proper pleading practice, and this part of proposed [76CC(j)] should be disallowed in any event. If Quasar wishes to persist with the plea, it may be more appropriate for it to be added to [48], which seems to deal with the topic of deed polls and the execution of a native title mining agreement.
Finally, proposed [76CC(k)] contains a pleading that Alliance’s conduct pleaded in the first 11 sub-paragraphs, and its purpose as pleaded in sub-par (i), constituted breaches of its express and implied contractual duties, which duties are pleaded in [2] and [2A] of the Counterclaim. The plea of breach of contract in [76CC(k)] is inappropriately located. It would be more appropriately located in the Counterclaim itself. If Quasar wishes to recast its pleading in this way it should be careful to ensure that it pleads in the Counterclaim only those paragraphs of the defence which plead conduct of Alliance which can be a breach of its contractual duties. Some of the sub-paragraphs in [76CC] cannot reasonably be regarded as allegations of this kind. They are sub-pars (a), (b), (d), (e), (f), (i), and (j). The first five of these paragraphs may be particulars supporting the plea of Alliance’s purpose which is pleaded in sub-par (i) but they are not by themselves pleas of breach of contract.
In order for proposed [76CC] to be sustainable as a plea, the matters alleged have to be what the opening words of the paragraph indicate they are intended to be, namely a defence to the allegations that Quasar had, in relation to the execution of both the First and Second NTMAs, breached its fiduciary duty and implied contractual duty of good faith.
In my opinion, none of the allegations in [76CC] can be understood in that way. The first 12 sub-paragraphs are pleadings about Alliance’s conduct and purpose: not Quasar’s. Quasar does not plead that the alleged conduct of Alliance meant that duties pleaded by Alliance could not and did not arise, or that they had not been breached at all, or at least in the way alleged by Alliance, or that if breached, the breach was of no particular consequence. Nor is there any plea of conduct of Quasar in response to the alleged conduct of Alliance.
I conclude that proposed [76CC] is not a pleading in defence of the pleaded breaches of fiduciary and implied contractual duty of good faith and therefore, subject to consideration of the uses which Quasar seeks by cross-reference to make of the pleading in other paragraphs of 4D-CC, it should not be permitted. I now turn to those cross-references.
Paragraph 74.3(c), (d) and (f)
By [74.3(c)] Quasar denies Alliance’s allegation that it had, without any proper basis for doing so and without there being a proper purpose for doing so, disregarded legal advice which it had received to the effect that Alliance should be a named party to the NTMA and kept informed of the drafting process. In elaboration of that denial, Quasar pleads the matters set out in [74.3(d)]-[74.3(o)].[18] Each of [74.3(d) and (f)] contain cross-references to [76CC].
[18] I note that the plea in proposed [74.3(o)] appears to be unnecessary in that it repeats, in effect, the denial made in [74.3(c)].
Paragraph 74.3(f) contains a positive plea by Quasar of its purpose in entering into the First NTMA without having Alliance as a party. It says it relied upon certain legal advice which it had received, as well as the position taken by the Mining Registrar in registering the WAC Agreement (to which Alliance had not been a party). Quasar then pleads that it decided, having regard to certain conduct and statements of Alliance, that it was in the interests of the joint venture to conclude an NTMA expeditiously, and that to achieve this it would not involve Alliance in the negotiation and drafting of the NTMA, nor have it named as a party.
Quasar particularises the conduct and statements of Alliance upon which it relies for this purpose by cross-reference to [76CC(a)-(d)].
In my opinion, there is no reason why those matters could not be pleaded as distinct particulars of the allegation in [74.3(f)]. They do not by themselves justify the retention of [76CC].
It is convenient to record at this stage my conclusion that the plea in [74.3(f)] lacks appropriate particulars. As noted, Quasar pleads that by reason of certain matters, it decided that Alliance should not be named as a party to the First NTMA and should not be involved in its negotiations. However, it does not plead the material facts necessary to support this plea, namely, particulars as to when Quasar made the pleaded decision, who it was within Quasar or on its behalf who made the pleaded decision, and a brief statement of the matters relied upon for the attribution to Quasar of the decision by that person or those persons. This deficiency should be remedied by the provision of further particulars.
The reference to [76CC] in [74.3(d)] does not justify the retention of [76CC] as an independent plea. In that paragraph Quasar pleads that “following and by reason of” the events pleaded in [76CC] it sought formal advice as to whether Alliance was required to be a party to the NTMA and that it received advice to the effect that it was authorised under the JVA to negotiate and execute the NTMA on behalf of Alliance. In my opinion, the introductory words in [74.3(d)] which refer to [76CC] add very little to the effect of the plea. Quasar should instead plead the date or dates upon which it did seek the “formal confirmatory advice” which it alleges.
Paragraph 74.3(g)
The cross-reference to [76CC(ga)] in proposed [74.3(g)] does not justify the retention of [76CC] as an independent plea. In [74.3(g)] Quasar pleads that Alliance had certain knowledge and further that it had not objected to the approach of the Mining Registrar prior to certain conduct of Alliance, some of which is particularised in [76CC(ga)]. It seems that the only purpose in the reference in [74.3(g)] to [76CC(ga)] is to identify a time by which Alliance had the knowledge alleged and the period during which it had not made objection. Instead of particularising the time by cross‑reference to [76CC(ga)], Quasar could as easily have specified in [74.3(g)] an actual date.
Paragraph 74.3(n)
The final cross-reference to [76CC] in the defence is in [74.3(n)] to which I have referred earlier in these reasons. The reference to [76CC] is by way of incorporating a limited number of particulars. If Quasar re-pleads in the way outlined above, the cross‑referencing will be unnecessary.
Paragraph 82
The disallowance of proposed [82] means that this cross reference does not have to be considered.
Cross-Referencing in the Counterclaim
By [3.2] of the Counterclaim, Quasar pleads that Alliance breached contractual duties arising under the JVA by causing unnecessary and unreasonable delay in the registration of the two NTMAs, in the granting of the mining lease and in the commencement of mining operations. Some of the particulars of this allegation include paragraphs within [76CC]. However, if those pleas are made elsewhere in the defence or Counterclaim, as contemplated by the above reasons, then the cross-reference can be to those pleadings with the effect that the reference to [76CC] becomes unnecessary. If they have not previously been pleaded, then they can be pleaded as particulars to the allegation in [3.2].
The same reasoning applies with respect to the cross-referencing to [76CC] in [4(a), (c) and (d)] of the Counterclaim. If Quasar wishes to rely in more than one paragraph of the Counterclaim on the same alleged conduct of Alliance, it need plead that conduct only once and then make an appropriate use of cross referencing.
Conclusion on [76CC]
My conclusion is that proposed [76CC] should be disallowed. That does not mean that its contents are entirely disallowed. If Quasar wishes to persist with some of the pleas, then it should make them in the appropriate location and in the ways indicated by the above reasons.
Quasar’s Counterclaim
Alliance objects to three paragraphs in Quasar’s Counterclaim: [4(a)], [4(c)] and [4(d)].
By [4(a)] Quasar pleads that Alliance breached express and implied terms in the JVA by failing to cooperate with it to obtain the Government approval for the native title mining agreement required under the Mining Act. It particularises this claim by reference to [74.3(n)], [74.4] and [76CC] as well as [40] and [48] of its defence. As noted earlier, [74.3(n)] is not a plea of conduct of Alliance at all and is disallowed. This is accordingly an inappropriate particular. Nor can the whole of [76CC] be justified as a particular of the claim in Counterclaim [4(a)]. If Quasar wishes to rely on sub-pars (a)-(d) and sub-pars (ga)-(i) of [76CC]or some smaller number of those sub-paragraphs, then it should refer to them explicitly thereby avoiding the uncertainty in its present pleading.

I overrule Alliance’s objections to the cross referencing of [40] and [48] and [74.4].
In Counterclaim [4(c)], Quasar alleges that Alliance breached contractual terms by refusing to agree to the registration of the First NTMA until Quasar and Heathgate had entered into an agreement with Alliance pursuant to which Alliance would obtain a commercial benefit in its own right rather than for the joint venture. Quasar particularises this claim by cross references to [48], [74.3(n)], [74.4] and [76CC].
For the reasons given above, I do not regard [74.3(n)] as a proper particular and the comments made in relation to [4(a)] concerning [76CC] are equally applicable to the present pleading. Otherwise, I overrule Alliance’s objection to [4(c)].
Quasar pleads in [4(d)] that Alliance was in breach of contract by engaging in conduct which actively prevented Quasar from performing its obligations as manager of the joint venture under the JVA to obtain registration of the native title mining agreements and the necessary Government approvals. It alleges further that Alliance has obstructed the program of steps necessary for the joint venture to proceed to mining. It particularises these claims by reference to [74.4(b)] and [76CC(ga) and (h)]. Contrary to the submission of Alliance, I regard those as being appropriate particulars (subject to my earlier comments about [76CC(ga)] and to those paragraphs being located appropriately in the defence).
Next, Quasar refers by way of particulars to sub-pars (aa), (ab), (g) and again to (h). I reject Alliance’s objections to that aspect of the pleading (again subject to my comments about proper location of those pleas).
I accept that [48] may constitute appropriate particulars but uphold Alliance’s objections with respect to [72A] to [72G] inclusive.
Heathgate Defence
In view of the disallowance of [78A] in the Heathgate defence, [74(b1)] and [74(d)] will require some revision in order to incorporate their cross-reference to (a)-(g) of [78A]. I grant Heathgate permission to make that revision.
I also consider it appropriate for Heathgate to provide in [74(b1)] and [74(d)] the same particulars which I indicated are required in the case of [74.3(f)] of the Quasar defence.
Summary
In summary, I uphold Alliance’s objections to [82] and [78A] respectively of the Quasar and Heathgate defences. I also uphold Alliance’s objection to proposed [76CC] of the Quasar defence. That does not mean that those parts of [76CC] which are pertinent to other pleas may not be re-pleaded (with the modifications indicated in the body of the reasons to be necessary) in an appropriate location elsewhere in the defence in support of those pleas.
I uphold some (as indicated in the body of the reasons) of Alliance’s objections in relation to Quasar’s Counterclaim and its objection to [74(k)]. I direct that Quasar provide further particulars (as indicated in the reasons) of its proposed [74.3(f)]. Proposed [74(b1)] and [74(d)] in the Heathgate 4D-CC are, in substance, counterparts to the Quasar [74.3(f). Accordingly, I also direct Heathgate to provide the same particulars in relation to those paragraphs.. My reasons also identify some other deficiencies in Quasar’s 4D-CC which must be addressed.
I direct the parties to bring in Minutes of Order to give effect to these reasons and orders.