Bougainville Copper Ltd v RTG Mining Inc

[2021] VSC 231

IN THE SUPREME COURT OF VICTORIA AT MELBOURNE Not Restricted

COMMERCIAL COURT

S CI 2018 00309

BOUGAINVILLE COPPER LIMITED (ARBN 007 497 869)	Applicant
v
RTG MINING INC (ARBN 164 362 850)	First Respondent
and
CENTRAL EXPLORATION PTY LTD (ARBN 609 946 125)	Second Respondent

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JUDGE:	Mukhtar AsJ
WHERE HELD:	Melbourne
DATE OF HEARING:	17, 18, 21 May 2018
DATE OF JUDGMENT:	5 May 2021
CASE MAY BE CITED AS:	Bougainville Copper Ltd v RTG Mining Inc & Anor
MEDIUM NEUTRAL CITATION:	[2021] VSC 231

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DISCOVERY - Pre-action discovery of documents from prospective defendant - Pre‑existing lucrative mine in Bougainville, Papua New Guinea, operated by applicant - Cessation of mining due to civil war - Later re-conferral of exploration licence to applicant over same land area of mine - Mining land and underlying minerals owned by customary landowners - Impending expiry of applicant’s exploration licence - Respondents’ co-existing rival interests to seek exploration licence to redevelop the mine in joint venture with customary landowners - Applicant’s legislative right to first seek extension of exploration licence - Consultative legislative process to enable ultimate extension decision to be made by responsible Minister - Applicant’s insinuation of bribes and illicit payments by respondents to influence customary landowners and others to oppose applicant’s interests - Public hearing and assessment by Mining Warden of objections from customary landowners - Minister’s ultimate decision to refuse an extension - Whether applicant has ‘reasonable cause to believe’ that it has or may have right to obtain relief against respondents for unlawful interference with its prospects for a licence extension - Absence of objective evidence to establish ‘reasonable cause to believe’ - Objective historical and contemporary facts not supportive of asserted grounds of belief - Application refused - Supreme Court (General Civil Procedure) Rules 2015 (Vic), rule 32.05.

DISCOVERY - Pre-action discovery of documents from prospective defendant - Not available as a broad investigative tool - Necessity to show ‘reasonable cause to believe’ on objective and probative evidence consonant with calibre of prospective claim for relief - Distinguishability between belief rather than suspicion or mere hunch or speculation.

DISCOVERY - Pre-action discovery of documents from prospective defendant - Interlocutory application - Evidentiary burden on applicant to show ‘reasonable cause to believe’ - Discretionary power to allow cross-examination of respondent’s deponent - Not usual or useful to allow cross-examination as a rehearsal for prospective trial - National Hearing Centres Pty Ltd v Vic O Tech Pty Ltd [2013] VSC 292 explained.

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APPEARANCES:	Counsel	Solicitors
For the Applicant	Mr C M Scerri QC with Ms K Anderson	Patrick & Associates Pty Ltd
For the Respondents	Mr D J Batt QC with Mr T B Maxwell	SBA Legal Pty Ltd

TABLE OF CONTENTS

Introduction........................................................................................................................................ 1

The applicant and its economic interests in Bougainville......................................................... 6

The respondents and others........................................................................................................... 15

What is this application about?..................................................................................................... 19

The basis of the application........................................................................................................... 21

The broad basis of the application............................................................................................ 25

The material in support of the application.............................................................................. 26

The documents sought............................................................................................................... 27

The opposing material................................................................................................................ 29

Cross-examination on a rule 32.05 application........................................................................... 32

Accrual of the respondents’ rival interests in Panguna............................................................ 34

Was there an extension application made by BCL?.................................................................. 35

The joint venture by Central with landowners at Panguna.................................................... 40

Presentation to the officials of the ABG...................................................................................... 41

The excursion to the Masbate mine.............................................................................................. 44

The apparent support by the ABG for SMLOLA involvement, and the activities of Messrs Daveona and Miriori................................................................................................................. 46

The Leader’s Forum and an unexecuted Memorandum of Understanding......................... 54

The announcement to the ASX and TSX  on 5 December 2017............................................... 63

The Mining Warden’s hearing on 11 December 2017 and the announcement about it to the ASX and the TSX on 12 December 2017.......................................................................................... 66

The pre-application request for documents................................................................................ 71

Did BCL make all reasonable enquiries?.................................................................................... 77

Judicial review proceedings........................................................................................................... 79

‘Reasonable cause to believe’........................................................................................................ 82

The grounds of the application..................................................................................................... 85

The reasonableness of BCL’s grounds for a belief.................................................................... 94

Findings and evaluations............................................................................................................... 94

Conclusion and proposed orders................................................................................................ 101

HIS HONOUR:

Introduction

1. This is a judgment on an application made for pre-action discovery of documents under rule 32.05 of the Supreme Court (General Civil Procedure) Rules 2015 (Vic). That rule states:

Where:

(a)there is reasonable cause to believe that the applicant has or may have the right to obtain relief in the Court from a person whose description the applicant has ascertained;

(b)after making all reasonable enquiries, the applicant has not sufficient information to enable the applicant to decide whether to commence a proceeding in the Court to obtain that relief; and

(c)there is reasonable cause to believe that the person has or is likely to have or has had or is likely to have had in that person’s possession any document relating to the question whether the applicant has the right to obtain the relief and that inspection of the document by the applicant would assist the applicant to make the decision –

the Court may order that that person shall make discovery to the applicant of any document of the kind described in paragraph (c).

1. This intensely fought application went for three hearing days, after which another controversy arose about a third party’s entitlement to have access to the transcript of the hearing.  That of itself required a considered judgment to be given, which has been reported.[1] 

   [1]See Bougainville Copper Ltd v RTG Mining and Another (2018) 56 VR 129.

1. Before exposing and evaluating the intricate facts of the application, there ought be a recapitulation at the outset about the purpose and operation of this rule because the essence of the opposition to the application was not based on residual discretionary considerations but, on principle, that the application was being made without an objective evidentiary basis to demonstrate a ‘reasonable cause to believe’, and that the rule was being used for an illegitimate investigative purpose to find a reasonable cause to believe.

1. Documents are a person’s private property, and can be especially proprietary or confidential to a corporation in trade and commerce. Rule 32.05 has to be understood in the wider context of the adversarial method of civil litigation in which there is otherwise no means to require production of any documents to an inquisitive adversary before the commencement of legal proceedings; that is, no obligation before proceedings are first commenced on the basis of stated allegations of material facts according to which a cause of action is disclosed, and a claim made for a legal remedy or relief. When that occurs, and without more, the Court’s procedural rules, in aid of the administration of justice, give the parties the right to obtain documents from each other before trial to discover for themselves facts that are relevant to the case to enable the proper conduct and adjudication of the lawsuit.

1. Rule 32.05 is another tool of justice for discovery of facts that enables an adversary, in certain conditions, to seek discovery of documents and information before a proceeding is even commenced in the Court and to do so in aid of a lawsuit that may, or may not, be brought depending on the information obtained in the documents sought.  This rule is thought to be a modern innovation to the remedy of discovery that originated in the auxiliary jurisdiction of courts of equity to assist in the prosecution of an existing proceeding at law.[2]  

   [2]See the explanation of the rule’s provenance and its validity as given by Finn J in Airservices Australia v Transfield Pty Ltd (1999) 92 FCR 200.

1. The principles informing the operation of rule 32.05 and the Federal Court of Australia’s once similar but no longer identical rule have been the subject of many authorities.[3]  It has been notably remarked ‘existing authorities appear to have been influencing these applications into a form of mini-trial where a form of fact finding takes place, well beyond the mandate of the words of the rule’ and ‘[t]hose authorities should not be utilised to form a complex matrix of sub-rules of a tolerably straightforward provision’.[4]  

   [3]Order 15A rule 6 of the Federal Court Rules 1979 was identical to the Victorian rule 32.05. Later, the Federal Court Rules 2011 (Cth) brought in a new replacement rule 7.23.  That new rule does not use the Victorian expression: ‘Where there is reasonable cause to believe …’.  Rule 7.23 speaks in the active voice, stating: ‘(1) A prospective applicant may apply to the Court … if the prospective applicant: (a) reasonably believes that he or she may have the right to obtain relief in the Court from a prospective defendant whose identity has been ascertained’.  That change is regarded as having introduced a subjective element, but nevertheless requires the belief of the prospective applicant to be objectively reasonable: see Poole v Australian Pacific Touring Pty Ltd [2017] FCA 424 (Bromwich J).

   [4]Per Allsop CJ in Pfizer Ireland Pharmaceuticals v Samsung Bioepis AU Pty Ltd (2017) 257 FCR 62, 64 [2], 66 [8] (‘Pfizer’); [2017] FCAFC 193, [2], [8].

1. In this Court, the purpose and operation of the rule was stated concisely in 1998 by the Court of Appeal in Schmidt v Won in this way:[5]

The rule, introduced in 1986, should be construed benevolently because its intention was both to assist claimants without sufficient, precise information to launch an action and to prevent the bringing of speculative suits: [citation omitted].  Applications, however, must not be based upon ‘mere hunches’ or such flimsy foundations as will not satisfy the requirement that ‘reasonable cause’ should be shown for the necessary belief.  That is not to say, however, that some form of ‘fishing’ inquiry is not justified under the rule; indeed it is the very purpose of the rule to permit an inquiry of this kind, if the required conditions are made out.

[5](1998) 3 VR 435, 445 per Ormiston JA, Batt and Charles JJA agreeing. See also an earlier decision of the predecessor Appeal Division of this Court in Scarletti Pty Ltd and Others v Millwood Printing Co Pty Ltd (Unreported, Full Court, 28 July 1994) 11–12.

1. The ‘benevolence’ of rule 32.05 to compel someone to hand over documents in order to help the recipient decide whether to sue the giver of those documents, starts with enabling an applicant to move the Court for such an order without having to articulate a cause of action or show a prima facie case. The language of the rule makes it enough for an applicant to identify the nature of the relief that may be available for the apprehended wrongdoing. And for the possible gains to be obtained, an applicant can move the Court on the rather low threshold of showing reasonable cause to believe that it may have the right to obtain relief.  ‘May have’ denotes a possibility.  It signifies some degree of tentativeness.  Moreover, the objective character of the rule as written does not require the applicant to actually hold the belief.  It will be enough if, on the evidence before the Court, a reasonable person could form the belief.[6]

   [6]See Telstra Corporation Ltd v Minister for Broadband, Communications and the Digital Economy (2008) 166 FCR 64, 79 [58].

1. When the amenity of this procedural rule and what it can reap is so understood, it can be expected that as a matter of administering reciprocal justice to a respondent in an application, the Court’s power under the rule can only be attracted if the preconditions are properly made out, especially the threshold requirement in paragraph (a) to show there is ‘reasonable cause to believe’ that there may be a right to obtain relief for a civil wrongdoing.  That is a significant limiting condition, the satisfaction of which is not per se a matter of discretionary judgment.  An applicant must adduce evidence of the objective facts by which an applicant claims there is reasonable cause to believe in a right to obtain relief.  That is why, for the purposes of the rule, something more than a mere assertion of a belief is required, and a hunch or flimsy foundation is not enough.

1. The perceived benevolence of rule 32.05 should not be misunderstood as allowing it to be used by an applicant as a broad investigative tool to explore someone’s documents to find out ‘what happened’ and see if there is a cause of action available at all.[7]  Rather, the rule concerns itself with the situation where an applicant can show that there is already ‘reasonable cause to believe’ that it may have a case, but having made reasonable enquiries, it does not have sufficient information to decide whether or not to take the consummate step of deciding to actually commencing legal proceedings.  That is usually because the applicant is lacking some particular information or type of document that is necessary to enable a decision to be made whether or not to take the step of suing.  In that situation, and assuming the scope of documents sought is not extravagant or too invasive, generally speaking, it will be seen by a Court as just and convenient to compel a respondent to produce the telling document because it is in the interests of the administration of justice to enable a decision whether or not to sue to be made responsibly and on sufficient factual grounds.  In that sense, and only where reasonable cause to believe is shown, the rule is ‘tolerably straightforward’ and it can be said generally when speaking of the rule’s benevolence, that the tendency is for the arc of justice to lean towards allowing a disclosure of facts and documents as being the constructive course.

   [7]See St George Bank Ltd v Rabo Australia Pty Ltd (2004) 211 ALR 147, 153–4 [26].

1. But it would certainly be unjust, under a banner of benevolence or an ethic of disclosure, to allow the rule to be used by an applicant to embark on an expedition to fossick through someone’s documents looking for information to remedy deficiencies in satisfying the primary preconditions of the rule.[8]  That is, it would be unjust to compel production of documents under the rule to enable an applicant to see if it can thereby find grounds for a ‘reason to believe’.  That is critical to an understanding of the rule’s proper operation.

   [8]See Airservices Australia v Transfield Pty Ltd (1999) 92 FCR 200, 202–3 [5].

1. This application was opposed primarily on principle, and not really as a matter of the exercise of discretion, as being bereft of any probative objective evidence to show the grounds on which there was a ‘reasonable cause to believe’ that the applicant may have a right to obtain relief in this Court, and was instead based on no more than an insinuation that ‘something wrong may have happened’. From there, the opposition was levelled at saying the applicant was resorting to rule 32.05 at the threshold as a broad investigative tool to find out what happened; that is, to look into the circumstances in which events or conduct occurred, and see if there was any case to be made. That was said to be a purpose antithetical to the rule.

1. The application is peculiar and testing because the underlying facts did not occur in Australia and, instead, are set firmly in an historical, economic, and political context involving a statutory regime none of which is grounded on Australian soil.  The facts come from a close northern neighbour, Bougainville Island, which was originally recognised as the main island of the North Solomons Province of the State of Papua New Guinea (‘PNG’).  In 2005, the island came to be constituted as the Autonomous Region of Bougainville (‘Bougainville’), as governed by the Autonomous Bougainville Government (‘the ABG’).  To understand the meaning of being ‘autonomous’, it is stated publicly that:

ABG governs as an autonomous region of Papua New Guinea and is the only region with this political status.  This is an important distinction as being ‘autonomous within’ rather than ‘independent from’ Papua New Guinea.  Bougainville is not an independent sovereign state and therefore ABG cannot conduct certain activities (for example, ABG cannot make laws that contradict the national system of law or establish diplomatic posts in foreign countries).[9]

[9]See ‘How ABG Works’ on the ABG website: type="1">

Since the hearing of this application, in December 2019, the people of Bougainville have voted in a non-binding referendum to prefer, resoundingly, independence from PNG rather than greater autonomy.  A general election in 2020 changed the composition of Parliament and brought a new President.  These transformative events do not affect the adjudication of this application, although the prominent subject matter of the application — the prospective redevelopment of the historic Panguna gold, silver and copper mine in central Bougainville — has overtly been a matter of socio-political activity and importance both locally in Bougainville and in PNG national affairs.

1. The foreign location of the operative facts itself raises incidental questions of actionability in Australia or the jurisdiction of this Court on any future action that might be brought for which, by hypothesis, documents are being sought in this application to enable a decision to be made whether to commence a proceeding here.

The applicant and its economic interests in Bougainville

1. The applicant (‘BCL’) is a company incorporated in PNG.  It is registered as a foreign company in Australia with a registered office in Melbourne, Victoria.  BCL once was a subsidiary of Rio Tinto Limited, a recognisable multinational mining and resources company.  On 30 June 2016, Rio Tinto divested and transferred its controlling shareholding in BCL in equal parts to the PNG National Government and to the ABG.  That resulted in each government separately holding a 36.4% shareholding in BCL.  The balance is held by public shareholding and institutional investors. 

1. Those were the facts when the application was heard.  Since then, it has come to the Court’s attention from publicly available information that after the referendum, on about 12 March 2020 the PNG National Government resolved to transfer its 36.4% shareholding in BCL to the ABG.[10]  Thus, unless there have been other facts unknown to the Court, the ABG has become the majority shareholder in BCL.  Nothing substantive turns on that for this application.  But, the fact that the ABG has at all relevant times been a shareholder of BCL as well as being responsible for the regulation and administration of the mining laws on Bougainville is part of the potent political context in which the facts of this application come to be evaluated. 

   [10]See ‘Official Joint Statement of the Joint Supervisory Body Meeting in Port Moresby by Co-Chairs Hon. James Marape MP, Prime Minister of Papua New Guinea and Hon. Dr Chief John Momis, GCL, MHR, President of the Autonomous Region of Bougainville’.  (Document is not itself dated.)

1. Stepping back in time, in 1972, BCL commenced operation of an open-pit mine and processing facility for gold, silver and copper at Panguna, situated in the mountain region of central Bougainville.  BCL did so having been granted a ‘Special Mining Lease’ designated as ‘SML 1’ under an agreement made with PNG in 1967.  That agreement was ratified and given the force of PNG national law by the Mining (Bougainville Copper Agreement) Act 1967, Chapter 196.  As I understand the history, this occurred at the time of Australian colonial administration. 

1. The mine was lucrative.  In the 17 years from 1972 to 1989, BCL’s operation of the Panguna mine produced concentrate containing substantial tonnage of gold, silver, and copper.  The value of production is said to have provided about 44% of PNG’s exports and about 17% of the National Government’s internal revenue.[11]  Contemporary valuations of the mine vary, but documents amidst the evidence put the ‘development value’ of the mine in 2018 as ranging between US$5.113 billion to US$34 billion, depending on various assumptions made in the valuation.[12]  This world-class mine was thus a major asset of PNG’s national economy and remains to be viewed as a major asset for the fiscal self-reliance of Bougainville, more so in the present formative conditions of independence.

   [11]Affidavit of Craig William Owen Phillips sworn 29 January 2018 (‘Phillips Affidavit’) [5].

   [12]Court Exhibit I [15].

1. BCL’s operations at the Panguna mine were brought to a halt in May 1989.  That was due to the ravages of what became a ten-year civil war on Bougainville as waged between the secessionist Bougainville Revolutionary Army and PNG forces, and which involved other armed, and complex, changing groups.[13]  It was a conflict of international significance.  Writers describe it as ‘the deadliest, bloodiest, and most destructive conflict in the South Pacific since World War 2’ which was conducted ‘at a level of savagery and brutality that is difficult to comprehend’, in which 10,000 to 20,000 people are said to have died.[14] 

   [13]Phillips Affidavit [3].

   [14]See J Woodbury, ‘The Bougainville independence referendum: Assessing the risks and challenges before, during and after the referendum’, January 2015, Australian Defence College, Centre for Defence and Strategic Studies, p 6.

1. I trust it is not controversial or damaging to say (according to materials in this application) that BCL’s operations of the mine had major adverse environmental and social impacts on Bougainville, and brought with it serious grievances among Bougainvilleans about matters such as the limited share of mine revenue and inadequate, unfairly distributed, and unpaid compensation for damage done.[15]  This is not to be taken as the Court presuming to pass oversimplified comment on a complex historical and ethno-political subject.  It is to do no more than state a general historical fact present in the strong undercurrent of this application about the enduring presence of ‘legacy issues’ for BCL concerning the major adversities resulting from its past operation of the Panguna mine as one of the factors contributing to the civil war, and of what those lingering legacy issues meant to Bougainvilleans and government well after the civil war had ended, when it came to the prospect of BCL redeveloping the mine and recommencing mining operations.  

   [15]D Vernon ‘The Panguna Mine’ in AJ Regan and HM Griffin (eds) Bougainville Before The Conflict.

1. As I understand the history, the civil war came to an end in August 2001 after the signing of the Bougainville Peace Agreement between Bougainvillean leaders and the State of PNG.  That agreement provided for a division or decentralisation of existing powers as between the PNG National Government and the ABG which came to be constituted as a polity under the Bougainville Constitution (2004).[16]  Correspondingly with the PNG National Constitution, the Bougainville Constitution conferred functions and powers on the ABG that specifically included ‘mining’ on Bougainville.  On the subject of ‘natural common mineral and oil resources’, the Bougainville Constitution stated:[17]

(1)The laws and policies of Bougainville shall be directed towards the recognition of customary rights of the People of Bougainville in relation to the land and the sea and natural, mineral and oil resources of Bougainville and any law relating to the development of such resources shall take that into account.

(2)The utilization of the land and the sea and natural resources of Bougainville shall be managed in such a way as to meet the development and environmental needs of present and future generations of the People of Bougainville and the Autonomous Bougainville Government shall take all possible measures to prevent or minimize damage and destruction to land, seas, air and water resources from pollution or other causes.

[16]Operative on 9 June 2005.

[17]Bougainville Constitution s 23.

1. With the devolution of powers, there followed a regime of new statutory laws in Bougainville to regulate mining and minerals.  That occurred first with the Bougainville Mining (Transitional Arrangements) Act 2014 which came into operation on 8 September 2014.  I shall pass over that Act as it was a short-lived interim law having no real practical operation and came to be repealed by the long-term Bougainville Mining Act 2015.  That Act (‘2015 Mining Act’) commenced on 1 April 2015.  

1. It is sufficient to refer to five salient outcomes of the 2015 Mining Act that illuminate the setting and the facts of this application.

1. First, the State of PNG’s ownership of minerals in Bougainville land was expunged.  The 2015 Mining Act provided that: ‘All minerals existing on, in or below the surface of land in Bougainville ceased to be the property of the State on 8 September 2014, in accordance with section 12 of the Transitional Mining Act’.  Instead, all minerals on, in or below the surface of customary land in Bougainville became the property of the owners of the customary land.  All minerals on non-customary land became the property of the ABG.[18] 

   [18]2015 Mining Act, ss 8 and 9.

1. Secondly, under the 2015 Mining Act, although the customary landowners became owners of the minerals, the power to grant mining tenements over customary land was conferred exclusively on the ABG.[19]  That power is to be exercised according to mandatory statutory considerations such as: the customary rights of Bougainvilleans and the desire for unity; the minimisation of environmental, social and cultural impacts; and ‘the promotion of equitable development amongst all parts of Bougainville including less developed areas and areas without minerals so as to avoid or minimise tensions and conflict likely to be associated with significant inequality’; and the need for the ABG to develop autonomy and achieve fiscal self-reliance.[20] 

   [19]Ibid s 14.

   [20]Ibid s 16(e).

1. The dichotomy between the customary landowners’ ownership of minerals on their land, and the exclusive right of the ABG to grant exploration and mining tenements over that customary land would, it may be thought, engender recognition not only of the need for proper public governance for orderly mining developments on Bougainville to enable advancement, but also recognition of the reality that the large-scale extraction of mineral deposits on customary land could only occur with the involvement of mining companies having the technical competence, experience and financial means to undertake the exploration and mining of the minerals.  Thus, for customary landowners (as owners of the minerals under their land) to commercialise their interests, they would have to form commercial engagements with mining companies.  Such an engagement could possibly be with BCL as the pre‑existing operator (despite the legacy issues) or it could be with another new and suitable mining company. 

1. Thirdly, although customary landowners have no right of veto over an ABG decision to grant an exploration licence over their land, they have effective control over any mineral exploration on their land because the 2015 Mining Act gives them the right to deny access to land over which an exploration licence has been granted, unless a land access and exploration agreement has been negotiated between the explorer and the customary landowners.[21]  Without an agreement to access the land to be explored, an exploration licence would be sterile. 

   [21]Ibid s 10(b).

1. Projecting beyond the exploration phase, the Act stipulates that a mining lease must not be granted to a person other than the holder of an exploration licence or a transferee and must not be granted ‘if landowner permission of the mining lease has not been obtained’.[22]  That appears to give landowners significant power to block mining leases. 

   [22]Ibid s 126(2).

1. Fourthly, the 2015 Mining Act gives owners of customary land the right to officially organise themselves as a collective, in the form of an ‘approved landowner organisation’.  That is a means by which identity, legitimacy, and proper representativeness can be given to customary landowners, as well as being an orderly means by which customary landowner permission can be sought and given for the purposes of the Act.[23]  The approval of a landowner organisation is within the discretion of the Bougainville Executive Council; a discretion that cannot be exercised before the House of Representatives has debated the merits of an application.[24]  On obtaining approval, a landowner organisation has to comply with governance standards under the 2015 Mining Act, such as trust fund accounting, auditing requirements, and annual reporting.  

   [23]Ibid s 10(a).

   [24]Ibid s 35(1).

1. Fifthly, the 2015 Mining Act ‘disapplied’ various PNG mining statutes including the Mining (Bougainville Copper Agreement) Act.[25]  It also put an end to BCL’s Special Mining Lease (SML 1) over the land of the Panguna mine by proclaiming that lease to be ‘of no effect’.[26]  However, BCL was not left without a tenement.  Under the 2015 Mining Act, BCL was treated as having been granted a two-year exploration licence on 8 September 2014, over the same land at Panguna that was the subject of its previous Special Mining Lease.[27]  That two-year term was less than the maximum term of five years for an exploration licence which is otherwise permitted to be granted under the Act.[28]

   [25]Ibid s 364.

   [26]Ibid s 366.

   [27]Ibid s 367(2) and (3).

   [28]Ibid s 101(1).

1. Having had its original Special Mining Lease taken away, the deemed grant of a two-year exploration licence to BCL could be described as a privilege or as conferring a priority, as it relieved BCL of the necessity to embark, in post-civil war conditions,  on the elaborate process of applying at first instance for an exploration licence under the 2015 Mining Act.[29]  That process would have involved the following: a host of manner and form procedures and technical requirements in lodging an application; the satisfaction of various criteria; a preliminary examination of the supporting materials by the Bougainville Mining Registrar; public notifications of the application; a consultation process with each Council of Elders with jurisdiction over the area of the proposed exploration licence; a procedure for receiving objections in prescribed form to the grant of an exploration licence; a hearing by the Bougainville Mining Warden to hear the views of not only the owners of the land the subject of the application but also the views of the owners of any adjacent land, as well as the owners of any other land ‘that can reasonably be expected to experience financial, environmental, social, cultural or other impacts should exploration or mining commence’, and the views of any approved landowner organisation that represented any of those landowners.[30] 

   [29]See Part 7 Division 3 and Part 10 Division 2 of the 2015 Mining Act.  Section 97(1)(e) requires an application for an exploration permit to comply with Part 10 Division 2.

   [30]2015 Mining Act s 246(2)(e).

1. Under the statutory regime, the Mining Warden has the statutory obligation to ‘record and assess the views of the landowners and the approved landowner organisations … including whether each landowner and approved landowner organisation has given permission for the matters to which the application relates’.[31]  Following a Warden’s hearing, a written report is made by the Warden to the Bougainville Mining Advisory Council for its consideration and to enable, as the next step, a decision to be made by the Bougainville Executive Council and the responsible Minister on whether to grant or refuse that application, having regard to the Mining Advisory Council’s advice.

   [31]Ibid s 250(3)(c).  See definition of ‘permission’ in s 32(1) of the 2015 Mining Act.

1. As the grantee of a two-year exploration licence under the 2015 Mining Act, BCL gained the right to enter and occupy the land to be explored but, under the Act, that was subject to first making a land access and compensation agreement with the customary landowners.[32]  BCL also gained exclusive occupancy for exploration purposes of the land over which the exploration licence was granted (subject to compensation agreements and some special overlapping rights)[33] as well as an exclusive right to subsequently apply for a mining lease over the same land.[34]  It is stated within the materials, and not contradicted by BCL, that BCL was for the duration of its two-year exploration licence unable to obtain customary landowner agreement to access the land the subject of the exploration licence, and was therefore unable to explore the mine area for the purposes of its prospective redevelopment of the mine.[35]  This refusal of access by the customary landowners to enable BCL to explore the mine land is of crucial importance in understanding subsequent events.  It shows the early negative attitude of the customary landowners of the mine land to the prospect of a return by BCL in post-civil war Bougainville.

   [32]Ibid s 103(1)(a).

   [33]Ibid s 103(2).

   [34]Ibid s 103(3).

   [35]See exhibit CP-17 of the Phillips Affidavit (p. 2, para 1).

1. But, for as long as BCL’s exploration licence held currency, any other prospective explorer seeking to become the re-developer of the Panguna mine could not obtain an exploration permit over the same land.  Moreover, as the holder of an exploration licence, BCL did not have tenure but was given the right under the 2015 Mining Act to apply for an extension of the licence ‘any number of times’ for a term not exceeding five years at a time.[36]  A continuum of sorts could be created because, once the Bougainville Mining Registrar accepts the lodgement of an extension application, the term of the exploration licence is taken by law to be extended until the application is either granted or refused.[37]  

   [36]2015 Mining Act s 101(1).

   [37]Ibid s 101(3).

1. As the holder of a two-year exploration licence from 8 September 2014, by law, any application by BCL for an extension of that licence had to be lodged at least 60 days before the expiration date of 7 or 8 September 2016; that is, it had to be lodged by 8 or 9 July 2016.[38] 

   [38]Ibid s 109(2)(b).

1. Once accepted for lodgement, an extension application is not assessed over a functionary’s desk as a prescribed form.  ‘Any person’ may submit an objection to the Mining Registrar.[39]  Each objection is given to the Bougainville Mining Advisory Council.  A copy of the extension application is given to each Council of Elders with jurisdiction over the exploration area to which the extension application applies, and the Elders are invited to submit a report. 

   [39]Ibid s 249(1).

1. The extension application must be the subject of a Warden’s hearing[40] to record and assess the views of: the landowners and the approved landowner organisations of the subject land as well as the land adjacent to the subject land, and any other land that could reasonably be expected to experience financial, environmental, social, cultural, or other impacts.  As I follow the 2015 Mining Act, the Warden’s assessment includes ‘whether each landowner and approved landowner organisation has given permission for the matters to which the application relates’.[41]  The Warden then submits a written report to the Mining Advisory Council, on whose advice the Executive Council of the ABG makes a decision on the extension application.

   [40]Ibid s 246(1).

   [41]Ibid s 250(2) and (3)(c).

1. It is the outcome of such a process that has brought about the present application.  This application emanates from BCL’s pursuit of a first extension of its exploration licence over the customary land of the Panguna mine area.  That occurred in a context in which, since about February 2016, there was gestation of a creeping rival aspiration by the respondents to make or take an opportunity to obtain rights and garner support to redevelop the Panguna mine in the altered conditions of post-civil war Bougainville.  To do that, the respondents had to first obtain from the ABG an exploration licence over the same land of the Panguna mine already subject to BCL’s exploration licence.  The respondents could not do that whilst BCL’s exploration licence subsisted. 

1. Thus, as put in argument by BCL, any rival mining company could not apply for an exploration licence unless, somehow, the rival first ‘got rid of’ BCL’s exploration licence.  That is an overture to what this application is about.

The respondents and others

1. Although there are common interests, the respondents are separable.  The first respondent, RTG Mining Inc (‘RTG Mining’) is a mining and exploration company incorporated in the British Virgin Islands.[42]  It is registered in Australia as a foreign company with a registered office in Perth, Western Australia.  Its securities are listed for quotation on the Australian Securities Exchange (‘the ASX’) and the Toronto Stock Exchange (‘the TSX’) in Canada. 

   [42]Phillips Affidavit [8] and exhibit CP-7.

1. The second respondent, Central Exploration Pty Ltd (‘Central’), is an Australian mining and exploration company with a registered office in Sydney.  It was incorporated in December 2015.  RTG Mining holds a 24% shareholding in Central.  Two of RTG Mining’s directors are on Central’s five-member Board of Directors.  One of those directors holding dual office is Ms Justine Magee.  With that authority, she states in her affidavit in opposition to the present application that ‘for some time, Central has been actively pursuing obtaining a commercial interest, directly or indirectly, in mining or exploration rights in the Panguna region of Bougainville’.[43]  She also states that: ‘Since around August 2016, RTG Mining has supported Central in that pursuit by sourcing and providing funding, and since around December 2016, as a shareholder’.[44]  Mr Ian de Renzie Duncan, another director (and the Secretary) of Central, is also personally active in Central’s activities in Bougainville.  He is described in the materials as a senior mining lawyer with wide international experience.

   [43]Affidavit of Justine Alexandria Magee sworn 4 March 2018 (‘Magee Affidavit’) [10].

   [44]Ibid [11].

1. There is a third corporation which is not a party to the application but which is integral to the pursuit of Central’s interests.  It is Central Me’ekamui Exploration Ltd (‘CMEL’ or interchangeably ‘the JV Co’ to avoid possible identity confusion with Central).  CMEL was incorporated in PNG as the corporate vehicle for a joint venture by Central and an organisation in Panguna, known as the Special Mining Lease Osikaiyang Landowners Association Inc. (‘SMLOLA’), to obtain the opportunity to redevelop the Panguna mine. 

1. The existence and role of SMLOLA is of crucial importance.  It was registered on 7 September 2011 under the Associations Incorporation Act (PNG).[45]  Under its Articles of Association, membership of SMLOLA was of natural persons who were ‘an osikaiyang [defined to mean original inhabitants in the Nasioi language of Central Bougainville] of Moroni, Pirurari, Pakia, Dapera, Guava, Kokore and Kupei Villages in accordance with the Nasioi custom in the Special Mining Lease area of Panguna Mine’.  The Articles also state that ‘a person’s right to being a member of this Association is determined by being born or adapted into the landowning clan in the Special Mining Lease area’.  Hence, SMLOLA was made up of people with a direct and proximate connection to the land on which the mining and extraction had occurred at Panguna. 

   [45]See Court Exhibit K and L.

1. The stated objectives and purposes of SMLOLA show that, in post-civil war Bougainville, the customary owners of the land in Panguna were attuned to the prospects of the redevelopment of the Panguna mine, the commercialisation of their mineral interests, and their participation in any redevelopment of the mine with a developer.  SMLOLA’s objectives are (with my underlining of matters I think are especially pertinent to the application):

(a)To promote, participate, encourage, facilitate and monitor on behalf of the people of the Special Mining Lease area the sustainable utilization of their land, forests, river and natural resources in Panguna Mine and to ensure that they receive maximum benefits from the developments and operation of the Panguna Mine.

(b)To promote peace, unity and co-operation amongst the Landowners in the Special Mining Lease area to harmoniously participate in the exploitation of their natural resources and to ensure sustainable utilization for the collective benefit of all Landowners in the Special Mining Lease area.

(c)To distribute the wealth generated from the development of the Panguna Mine equally to its members by developing, improving and maintaining vital services in their communities which in turn improve their standard of living.

(d)To receive, organize and administer funds, compensation payments, grants and gifts from the National Government, Autonomous Bougainville Government, the developer of Panguna Mine and others in PNG and overseas in pursuance of its objectives.

(e)To promote the efficient management of customary land, forests, rivers and other resources in accordance with local customary laws and sound economic principles and to assist the Special Mining Lease area in establishing income generating projects.

(f)To undertake education, training and awareness campaigns and programs on environmental issues, development, human rights, land and resources rights for the Panguna People.

(g)To be partners in development and operation of Panguna Mine and apply the dividends in promoting its objectives.

(h)To prohibit payment of dividends or interest to individuals and members of the Association.[46]

[46]See Court Exhibit L.

1. It is important to understand that the scale of the Panguna mine operations involved not just a single area of land owned by a particular group of customary landowners.  As well as the area of land on which the mining and extraction of minerals had occurred under the former Special Mining Lease, there were other areas of land such as a tailings area, a port area, and other infrastructure areas.  The significance of SMLOLA is that its members are the customary owners of the land that constitutes the former Special Mining Lease area for the Panguna mine.  Although there are other landowner associations representing the owners of land used for tailings and infrastructure works and installations, for the purposes of this application, the members of SMLOLA are the relevant or dominant customary landowners, and it will be their views and objections that count when it comes to any assessment of landowner attitudes to the grant of exploration and mining tenements over the former Special Mining Lease area. 

1. Even though it appears that SMLOLA was formed to represent the interests of customary landowners in the former Special Mining Lease area, it is the curious fact that SMLOLA was never registered as an ‘approved’ landowner organisation under the 2015 Mining Act.  The evidence on this application goes no further than saying that SMLOLA attempted to obtain such registration in or about March 2016, but that its application was not accepted for filing by the Department of Minerals and Energy Resources of the ABG.[47]  Thus, SMLOLA did not have any legal recognition for the purposes of the schema of the 2015 Mining Act.  But outside that, it is clear that SMLOLA was a legitimate entity, active and providing something resembling the auspices or representative voice for its members’ commercial interests as customary landowners in the redevelopment of the Panguna mine in a joint venture with Central.

   [47]Magee Affidavit [35].

1. Central has a 50% shareholding in the JV Co.  Three of Central’s directors including Mr Duncan are on its Board.  SMLOLA has a 25% shareholding in the JV Co.  The remaining 25% shareholding is held by Mr Philip Miriori who is the current Chairman of SMLOLA.  It is said that his shareholding ‘is not personally held but under the Joint Venture Agreement is held as Trustee for the citizens of Bougainville, the Autonomous Bougainville Government and the PNG Government’.[48]  Elsewhere, it is sworn that he holds those shares not for himself but ‘on behalf of all Bougainvilleans’.[49] 

   [48]See Exhibit F, penultimate paragraph.

   [49]Magee Affidavit [16]. There are no trust documents or verifications of such an arrangement in evidence.

1. RTG Mining has a minority interest in Central, but it does not have a shareholding in the JV Co.  Nor does it have a representative on the Board of the JV Co.  But it describes itself in the materials as ‘the development partner’ of the JV Co.  RTG Mining is said to have extensive experience developing mining operations in various locations, and its role is characterised as supporting the JV Co by providing it with technical expertise and raising capital to enable it to obtain an exploration licence to redevelop the Panguna mine. 

1. A fifth player in the dynamics and evolvement of the respondents’ pursuits is another landowner group in the Panguna region known as Me’ekamui Government of Unity (‘the MGU’).  Mr Miriori was also the President of the MGU.  The MGU is not an approved landowner organisation under the 2015 Mining Act.

What is this application about?

1. Describing it in abridged terms for opening purposes, this application emanates from BCL’s pursuit of an extension of its two-year exploration licence over the customary land of the Panguna mine area.  As I have said, that was happening in a context in which, from February 2016, there was a  gestation of a rival pursuit by the respondents to obtain an exploration licence over the same land.  It was also happening in a context in which, it is worth repeating, Rio Tinto had transferred its controlling shareholding in BCL, in equal parts, to the PNG National Government and to the ABG, resulting in each government separately holding a 36.4% shareholding in BCL.

1. It appears that the respondents’ pursuits occurred along two avenues of influence.  The first avenue was by directly engaging with the responsible ABG Minister and government officialdom in Bougainville to promote the respondents’ credentials as responsible and experienced mine operators, and to appeal to the ABG’s interests in reopening the Panguna mine in aid of enabling the ABG to gain fiscal self-reliance from a resumed mining operation.  The second avenue, in the new era of the 2015 Mining Act, was for the respondents to cultivate the support of SMLOLA and the customary landowners at Panguna by giving them an opportunity to become unified and to commercialise their newly gained interests as mineral owners by undertaking the prospective redevelopment of the Panguna mine in joint venture with Central.  As part of the complexities of the local politics in this case, there were some who at the same time were claiming that BCL had the landowners’ support as the preferred redeveloper of the mine.  And, of course, the ABG, as regulator of mining, had its one-third shareholding in BCL.

1. Ultimately, on 16 January 2018, and after a Mining Warden’s hearing to assess the views of landowners and affected parties towards BCL’s extension application, the ABG Minister for Mineral and Energy Resources, Vice President Masono, refused BCL’s application for an extension of its exploration licence.[50]  The Minister did so on the grounds that the Warden’s hearing showed that the customary landowners’ consent for BCL’s licence extension could not be obtained.  The decision was expressed in affirmative terms to say: BCL did not have the ‘social licence’ to redevelop the mine.  The Minister also announced a moratorium on exploration and mining over the land of the Panguna mine for an indefinite period.  Thus, in the upshot, it appears that there was no gain by BCL, or the respondents, or the SMLOLA customary landowners.  However, the refusal of the extension neutralised BCL’s position in Panguna by discontinuing its privilege of holding an exploration licence, subject to any challenge to the Minister’s refusal decision. 

   [50]Exhibit JAM-2 to the Magee Affidavit.

1. That takes me to the next event which, to minimise detail at this juncture, I shall only mention in brief but return to later on in this judgment  By 25 January 2018, BCL commenced legal proceedings (‘the judicial review proceedings’) in the National Court of Justice of PNG at Waigani to quash the Minister’s refusal decision.  On 10 April 2018, the National Court made a purely procedural order granting leave to BCL to seek judicial review, with an ancillary order granting  a stay of the Minister’s refusal decision pending the final determination of the review proceedings.[51]

   [51]See Court Exhibit A.

1. In the judicial review proceedings, the relief sought is threefold: an order in the nature of certiorari to quash the decision to refuse an extension; an injunction to restrain the granting to any other person of any licence or tenement over the land of BCL’s yet‑to‑be‑extended exploration licence; and an order in the nature of mandamus directing the Minister to grant BCL’s extension application. 

1. As far as this Court is aware, the judicial review proceedings are still pending. It hovers over the present application because, if the Minister’s decision to refuse BCL’s extension application is quashed by the National Court then, depending on the that Court’s ancillary orders (that is, whether it substitutes its own orders on the extension application or orders a rehearing before the Warden with directions), a serious question could arise whether BCL has suffered any loss of its exploration rights from which to found a right to obtain relief for the purposes of rule 32.05.

1. I was restless about this prospect, and squarely raised its significance in the course of argument. The respondents did not present an argument suggesting that the judicial review proceedings might impact on the current application. Nor did they suggest that this application is premature in the absence of a decision from the National Court, and therefore the Court should refuse the application as a matter of discretion. Instead, the thrust of the respondent’s opposition to the application was emphatically based, on principle, on the lack of any objective evidence from BCL to establish ‘a reasonable cause to believe’ that it had or might have a claim for relief under rule 32.05. Any reference by the respondents to opposition on discretionary grounds was supplementary in nature, if that.

1. I think that whilst recognising that a quashing of the Minister’s refusal decision is a possibility, it has not yet crystallised into a factor that can be taken into consideration in this proceeding, at least not as an objective fact informing the basis of the applicant’s cause to believe.  In the way this application was conducted by all parties, I shall treat the review proceedings as just another aspect of the complexities that forms the underlying context in which the facts are to evaluated.  For completeness, I shall return in chronological order to say more about the judicial review proceedings later in this judgment.

1. Thus far, I trust enough has been exposed to show the historical, political, and legal context in which the application is set.  It is much more than ‘background’.  The facts are informed by the evolving affairs in Bougainville, the significance and credence to be given to the views of the customary landowners after Bougainville was newly constituted, and the overlay of a post-civil war past in which the previous operations of the Panguna mine by BCL figured largely.   

The basis of the application

1. There are two main grounds for this application.  First, having been denied an extension of its exploration licence, ostensibly for lack of customary landowner support, BCL says there was some evidence of pre-existing ‘overwhelming and resounding majority support’ from landowners for BCL to become the developer of the mine. [52]  But, BCL says that the loss or diversion of that support might be explained by the respondents making unlawful payments of money or giving unlawful financial benefits or inducements - these are euphemisms for bribes - to customary landowners or SMLOLA officials (and maybe others) to oppose to BCL’s interests, and to cultivate favour towards the respondents in their pursuit of an exploration licence for the prospective redevelopment of the mine in joint venture with SMLOLA.  BCL thematically asserts in this application that if there were such unlawful or illicit payments (presumably in Bougainville), then by any means, such conduct would be actionable (presumably in this Court) as an unlawful interference with its economic interests, and therefore the Court should order discovery.

   [52]See Phillips Affidavit, exhibit CP-15, [5].

1. In the way this application was presented, BCL does not know what the payments might have been, and what they were for.  In the main, it seizes on a public document that has Central (but not RTG Mining) acknowledging that, with the knowledge of the ABG, payments were made to the SMLOLA executive that were ‘transparent and at arm’s length’ to enable the carrying out of an awareness and education campaign in Panguna about the respondents’ proposals to redevelop the mine in joint venture with SMLOLA.  There is elsewhere reference in the materials to exception being taken to the activities of Mr Duncan ‘splashing money around’ as part of the awareness campaign.  I shall return to these matters, and others,  in detail later. 

1. BCL contends that it ought be able to use rule 32.05 to obtain discovery from the respondents of any documents that show when, to whom, and for what purpose such payments were made to then enable BCL to see for itself if those payments make for a case that there was unlawful or illicit conduct. If they were, BCL says there may be grounds for an action (presumably in this Court, as the host Court of rule 32.05) for unlawful interference with its economic interests, an intentional tort under Australian law. If payments were made to officeholders of SMLOLA, then BCL also ventures to say that such payments might amount to a Commonwealth crime under the provisions of Australia’s Criminal Code Act 1995 which deal with bribery of ‘foreign public officials‘. 

1. As a second basis for the application, BCL says that any payments made by the respondents were occurring at a time when there were or had been divisions within SMLOLA, or divisions between SMLOLA and the MGU membership, as to whether BCL ought be supported as the redeveloper of the mine, or whether support should instead go to RTG Mining and the JV Co.  There was also a dispute internal to SMLOLA regarding who was entitled legally to hold office as its Chairman.  Mr Lawrence Daveona and Mr Philip Miriori each claimed they were entitled to hold that office.

1. There was a strong element of local politics to that SMLOLA leadership dispute.  It is said that Mr Daveona was a known supporter of BCL as the preferred redeveloper of the mine.  Mr Miriori was President of the MGU.  He also claimed that he was truly the Chairman of SMLOLA and had authority to speak for the customary owners of the Panguna mine land.  If true, that would put him in an influential position on the question of the preferred redeveloper of the mine, even though SMLOLA was not an approved landowner organisation under the 2015 Mining Act.  Mr Miriori was known to be opposed to the prospect of BCL resuming the operation of the Panguna mine, and a supporter of SMLOLA being in a joint venture with Central to redevelop the mine. 

1. The next election of SMLOLA officeholders was not due until December 2018.  Before then, the leadership dispute between these two men led to legal proceedings (‘the leadership proceedings’) that were commenced on about 8 May 2017 by Mr Miriori in the National Court of Justice at Waigani, PNG.[53]  Mr Miriori initially sought orders to, in effect, restrain Mr Daveona from holding an Annual General Meeting of SMLOLA.  He then amended the proceedings to seek orders to restrain Mr Daveona from acting as Chairman of SMLOLA and to restrain Mr Dennis Nasia from acting as its Secretary.[54] 

   [53]Exhibit CP-12 to the Phillips Affidavit.

   [54]Exhibit CP-14 to the Phillips Affidavit.

1. It is relevant to say that, in those proceedings, Mr Miriori was being represented by Corrs Chambers Westgarth, lawyers in Port Moresby, PNG.  After a mediation was conducted by a Judge of the National Court of Justice, the leadership proceedings were eventually settled under a deed made on or about 5 December 2017, as prepared by that law firm.[55]  Under that deed, in substance, Mr Daveona relinquished any claim to be the holder of the office of Chairman of SMLOLA.  He also pledged his support for RTG Mining as the preferred developer of the mine, and promised that he would work together with Mr Miriori to support RTG Mining.  BCL says this was wholly contrary to Mr Daveona’s past endorsement of BCL as preferred developer of the Panguna mine.  Thus, to borrow a Biblical metaphor used by BCL’s senior counsel, in abandoning his past loyalties to BCL and pledging his support for RTG mining, Mr Daveona was said, for no apparent reason, to have experienced a ‘conversion on the Road to Damascus’.  BCL points the finger of suspicion at a clause in the settlement deed in which SMLOLA (which was a party to the deed) agreed to contribute to the legal costs incurred by Mr Daveona and Mr Nasia in the leadership proceedings to a capped limit of K300,000.[56] 

   [55]Exhibit CP-19 to the Phillips Affidavit.

   [56]Said to be equivalent to AUD$120,000.

1. Nothing in the deed calls for a payment from RTG Mining or Central.  But it appears that BCL has its suspicions.  As a matter of coincidental timing (December 2017), BCL put into evidence the 2017 Annual Report of RTG Mining which reported the making of the reconciliation agreement.[57]  It did so for another suggestive forensic purpose.  The report contains: ‘Notes To The Consolidated Financial Statements 31 December 2017.’  In the Notes, one item of ‘Expenses’ is an ‘Impairment expense’.[58]  The recording of an ‘impairment expense’, as it was explained in Court, is done as a matter of prudent accounting to signify an expense or debt that could not be safely or correctly considered to be recoverable as an asset with a carrying value. 

   [57]Court Exhibit B.

   [58]See pp 35 and 54 of the Notes in Exhibit B.

1. The Notes to the Annual Report record: ‘Impairment of investment in the Philippines Associates’ and ‘Impairment of loans to the Philippines Associates’.  On the face of it, that is likely to be a reference to the Masbate Mine in the Philippines.  Recorded in those entries is an impairment expense of US$1,472,368, which reflects an investment in Central as an Associate in the Group.  What does that mean?  It means, in that year, RTG Mining invested US$1,472,368 in Central or funded it in that amount.  But, as explained in Court, the impairment entry shows money as received by Central, but it does not mean or show that the money was expended, or how the money was applied.  It may not have been expended at all. 

1. So what is the point of this accounting reference for present purposes?  BCL retracted a suggestion that the Court should infer that the US$1,472,368 was used by Central to make unlawful payments to landowners, or Daveona, or others.  The submission was that the impaired funding occurred in the ‘key period’ when Daveona ‘changed his mind’.  From there, the submission was that this accounting raised questions of what Central did with the money and, as there was no evidence from the respondents on this point, there may be documents that show to whom, and when, and why the ‘impaired’ funding was applied.[59]   

   [59]See transcript, pp 132–4 and 213–7.

The broad basis of the application

1. In this application, BCL does not say it has objective evidence for a belief that the respondents may have made unlawful payments to Mr Daveona, for the purpose of inducing him to abandon his previously held support for BCL’s interests and to oblige himself legally to work with Mr Miriori and SMLOLA to support the appointment of the respondents to redevelop the Panguna mine. Nor is BCL saying it has objective evidence to believe the respondents might have made unlawful payments to SMLOLA or customary landowners to gain their support to defeat BCL’s interests. Rather, BCL highlights the words of rule 32.05 that say ‘may have the right to obtain relief’ and beneficent spirit to contend that there is sufficient to say that say something strange or something wrong might have happened to induce Mr Daveona to abandon his past endorsement of BCL and his claim to Chairmanship of SMLOLA, and there is something strange or wrong has happened to lead to customary landowners to object to BCL’s extension application.

1. Whilst one would not expect corrupt conduct, such as bribery or illicit payments, to be obviously and neatly documented by the perpetrator for any scrutineer to see, BCL looks to rule 32.05 to compel the respondents to give discovery of documents underlying the making of the deed of settlement, and documents that evidence any payments to Mr Daveona or members of SMLOLA, so as to enable BCL to investigate and see for itself what the payments were for, and whether they afford grounds for bringing a case against the respondents.

1. As I see it, the issue is: do the objective facts reveal grounds for an existing belief by BCL that it may have a right to obtain relief against the respondents for unlawful interference with its economic interests, but discovery of certain documents is needed to make a decision whether or not to sue? Or, is it a situation where the rule is being called on to obtain discovery of documents not to give greater certainty to justify a decision to sue, but to investigate at a primary level whether there are grounds for a belief that a case may be brought at all? Is such an inquisitorial purpose justly within the proper function or faculty of rule 32.05?

The material in support of the application

1. BCL filed one affidavit sworn on its behalf in support of the application, sworn on its behalf by Craig William Owen Phillips, a solicitor employed as a consultant at the applicant’s firm of solicitors.  He is known to be a highly experienced commercial litigation lawyer.  Although, on an ordinary interlocutory application, it is permissible to adduce evidence through a litigant’s solicitor based on information and belief rather than personal knowledge, having regard to the nature and calibre of the economic interests involved in this out-of-the-ordinary application, I think that it was expectable for the Court to be presented with primary affidavit evidence from an officer or manager of BCL having active involvement or responsibility in the matter, especially as the facts are offshore and there is a sharp edge to the application. 

1. I cannot tell if Mr Phillips was involved ‘hands on’ to a significant degree in the affairs of the case as they occurred in Bougainville. His affidavit reads not so much a firsthand narrative of facts and circumstances, but rather as a reliable means of exhibiting a compendium of documents according to which the application is being propounded.

The documents sought

1. In paragraph 47 of his affidavit, Mr Phillips says BCL is seeking the following categories of documents from the respondents:[60]

   [60]Phillips Affidavit [47].

(i)Documents confirming, identifying or otherwise relating to the compensation or other benefit [within the meaning of s 70.1 of the Criminal Code Act 1995 (Cth)] or payment made by Central directly or indirectly to any representative or member of SMLOLA from 1 January 2016 to date as referred to in the ASX and TSX announcements made by RTG on 12 December 2017.

(ii)Documents relating to the arrangements between RTG, Central and/or Mr Ian Duncan or any representative thereof, and Mr Philip Miriori and/or SMLOLA concerning:

a.the legal fees and disbursements of Mr Miriori and/or SMLOLA paid, reimbursed or otherwise borne (whether directly or indirectly) by RTG, Central and/or Mr Duncan or any representative thereof from 1 January 2016 to date;

b.the terms upon which Corrs Chambers Westgarth agreed to act on behalf of Mr Philip Miriori and SMOLA in the PNG proceedings;

c.any benefit provided or to be provided to any party in the PNG proceedings (whether directly or indirectly) in consideration of:

i.the settlement or purported settlement of the PNG proceedings;

ii.the agreement of Mr Daveona to act in support [sic] the interests of Mr Miriori including in respect of any matter relating to the development of the Panguna mine; and

iii.the agreement of Mr Daveona to support the appointment of RTG as the developer of the Panguna mine;

d.The circumstances in which SMLOLA agreed to make a payment to Mr Daveona and/or Mr Nasia in connection with the PNG proceedings.

(iii)The settlement agreement relating to the purported settlement of the PNG proceedings.

(iv)Documents relating to the arrangements between RTG, Central and/or Mr Duncan or any representative thereof and Mr Philip Miriori and/or SMLOLA concerning:

a.the joint venture arrangements pursuant to which SMLOLA had nominated RTG as preferred developer of the Panguna mine as stated in RTG’s announcement to the ASX and TSX on 5 December 2017; and

b.SMLOLA’s decision to lodge an objection to the application by BCL for renewal of its exploration licence as stated in RTG’s announcement to the ASX and TSX on 12 December 2017

(v)      Any benefit:

a.provided by RTG, Central and/or Mr Duncan or any representative thereof (whether directly or indirectly) to Mr Miriori, and/or SMLOLA from 1 January 2016 to date;

b.procured by RTG, Central and/or Mr Duncan (whether directly or indirectly) to be provided to Mr Miriori and/or SMLOLA from 1 January 2016 to date; and/or

c.provided by RTG, Central [Exploration] and/or Mr Duncan or any representative thereof (whether directly or indirectly) to any third party in connection with the alleged arrangements between Mr Miriori and/or SMLOLA and RTG pursuant to which RTG was nominated as preferred developer of the Panguna mine.

1. Mr Phillips says that BCL seeks these documents for these purposes (with my underlining):

(a)to help the applicant establish whether it has a cause of action in tort for unlawful interference with BCL’s property rights; misrepresentation; conspiracy; and injurious falsehood against the first and/or second respondent;

(b)to identifying the circumstances by which SMLOLA’s support of BCL was changed to BCL’s detriment from June 2017 when an overwhelming and resounding majority of landowners supported BCL as the preferred developer of the Panguna mine, to December 2017 when SMLOLA nominated RTG Mining as the preferred developer of the Panguna mine and lodged an objection to the application by BCL …;

(c)to clarifying the circumstances and terms by which the PNG proceeding was settled, following which Mr Daveona ceased to support BCL as the preferred developer of the Panguna mine or dispute Mr Miriori’s challenge as Chairman of SMLOLA.

1. His affidavit adds this (with my underlining):

53.The applicant needs the documents of which discovery is sought in order to make an informed decision about whether to commence the potential action.  The applicant will be seriously prejudiced in the preparation and presentation of the applicant’s potential claims against the first and/or second respondent if it does not have access to the documents sought.  Furthermore the applicant will be put to unnecessary cost or expense.

1. These statements were seized on by the respondents to say they show a misunderstanding of the true purpose or availability of rule 32.05 because, unless reasonable cause to believe in the existence of a right to obtain relief is shown by evidence, the rule does not countenance giving discovery merely to enable BCL to find out what happened.[61]

   [61]See commentary in Civil Procedure Victoria Vol 1, [32.05.12] and reference there to Interwest Hotels Pty Ltd v Commonwealth Bank of Australia.

The opposing material

1. For the respondents, there was one affidavit sworn by Justine Alexandria Magee.  She is the Chief Executive Officer of RTG Mining and is a director of Central.[62]  When speaking for Central, and in a manner that is no more general than the affidavit material to which she was responding, Ms Magee states:

37.To my knowledge, Central has not made any unlawful payments or given any unlawful benefits or inducements in the manner that Mr Phillips appears to seek to insinuate or allege in his affidavit or at all.

38.To my knowledge, Central’s dealing with CMEL, the MGU, the SMLOLA and Mr Miriori in respect of the proposed joint venture have at all times been conducted at arms’ length and in a lawful manner.

[62]There was also an affidavit of Amy Joanne Rumble sworn 15 May 2018 that exhibited some correspondence between the lawyers.

1. Likewise, when speaking for RTG Mining, Ms Magee says:

46.To my knowledge, RTG has not made any unlawful payments or given any unlawful benefits or inducements in the manner that Mr Phillips appears to seek to insinuate or allege in his affidavit or at all.

47.To my knowledge, RTG’s dealings with Central and CMEL in respect of the proposed joint venture have at all times been conducted at arms’ length and in a lawful manner.

48.      To my knowledge, RTG owes no contractual obligation to BCL.

1. In essence, RTG Mining and Central say there were historical and other real, strong, and evident factors amongst Bougainvilleans, as well as the Panguna landowners, that explained landowner disfavour towards BCL and their support for the joint venture proposal with Central; a proposal that provided customary landowners with a commercial interest in a mining venture for the minerals under their land - minerals that became their property under the 2015 Mining Act.  They say that any payments made to customary landowners and to SMLOLA or its officials were ‘transparent’, and at arm’s length, and made as part of the legitimate pursuit of cultivating understanding and support for their joint venture proposal. 

1. BCL’s rejoinder has to commence with the premise, ‘I do not know if there were unlawful payments’, but goes on to say that if there were unlawful payments which interfered with BCL’s commercial interests, then a cause of action exists.  So, BCL says, if payments were made that were transparent and at arm’s length, then where is the injustice of ordering the discovery of those documents to enable BCL to ascertain, for itself, the payees, the amounts paid, and the purpose of the payments? 

1. But to that, of course, the respondents are entitled to say: documents are not to be produced at BCL’s behest and BCL is required, under rule 32.05, to show objectively based grounds for reasonably believing that the payments were unlawful, before a discretion arises to make an order for discovery to see if a case may be brought.

1. Ms Magee also makes an objection to the application on the grounds of oppression and confidentiality.  She states that documents in the possession of the respondents are located in various places in Perth, Sydney, Brisbane, Port Moresby and, ‘potentially’, in Arawa, Buka, and Panguna in the ARB, and further that documents in other locations may be held by solicitors, accountants, auditors, consultants, and advisors.  Investigation of all documents at the various locations would be, Ms Magee says, onerous, time-consuming and costly, added to which would be the additional burden of examining all documents for their commercial sensitivity and confidentiality.  On the merits of the application, she also exhibits a number of documents in the public domain that reveal facts concerning the respondents’ commercial pursuits at Panguna, and public reports about Bougainvillean attitudes that were hostile to the prospect of BCL resuming mining at Panguna.  I shall return to those facts later.

1. With prior notice, senior counsel for BCL sought the Court’s leave to cross‑examine Ms Magee.[63]  Leave was sought for the stated purpose of disputing the truthfulness of some positive statements in her affidavit, and to put to her that the effect of her evidence was to mislead the Court.  That translates to an attack on her credibility.  Leave to cross‑examine Ms Magee was opposed.

   [63]See the affidavit of A J Rumble sworn 15 May 2018. 

1. There was a procedural question whether leave was truly required.  This application, as a civil proceeding, was commenced correctly by an Originating Motion.  That is, a form of legal process in this Court which under rule 40.04(2) entitles a party to require a deponent, unless the Court otherwise orders, ‘to attend at the trial of the proceeding to be examined if notice that such attendance is required is served on the party’.[64]  That is distinguishable from rule 40.04(1) which applies ‘where an affidavit is filed in any proceeding’.  Under that rule, the Court’s leave is required to examine the deponent. 

   [64]See FAI Home Security Pty Ltd v Price and Others [1999] VSC 274.

1. As it happened, the technical question of the choice of applicable rule, and whether this application was a ‘trial’ by ordinary conceptions, gave way to an acceptance by the parties that as the application was interlocutory in nature, leave of the Court to cross‑examine a deponent was necessary.  A substantial argument then ensued about the grant of leave. 

1. I refused to give BCL leave to cross‑examine Ms Magee.  But as a point of opposition was seriously taken by the respondents that there was no judicial power to allow cross-examination of a deponent on such an application, I deferred the giving of reasons for a refusal until the ultimate judgment on the application.  My reasons now follow.

Cross-examination on a rule 32.05 application

1. The principal argument put on behalf of the respondents was that I was bound to follow a decision of Vickery J in National Hearing Centres Pty Ltd v Vic O Tech Pty Ltd and Anor (‘Vic O Tech’)[65] which, according to the respondents, held that the Court had no power to allow cross‑examination of a deponent on an application under rule 32.05. When that case is closely examined, I do not think it establishes such an unlikely general proposition.

   [65][2013] VSC 292, [142]–[147].

1. That case was an application under rule 37.02, which is similar to rule 32.05. On the same grounds as rule 32.05, rule 37.02 gives a prospective plaintiff similar means to obtain, as against a prospective defendant, a Court order for the inspection, detention, custody or preservation of any property not being a document to enable a decision to be made whether or not to commence proceedings. 

1. Vic O Tech was a typical example of alleged appropriation and misuse of copyright and proprietary information by an ex-employee as stored on computers.  The respondent was ordered by the Court to make available the computers and other devices that were used by the ex-employee so as to enable an expert examination of the stored information and files on them.  The respondent was also ordered to file an affidavit of documents that disclosed the respondent’s computer usage.  The applicant was not satisfied with the respondent’s compliance with the Court’s order and sought the Court’s leave to do two things: to serve interrogatories on the defendant; and for leave to cross‑examine the defendant on her answers to those interrogatories and on her other affidavits as already filed in the proceeding.  And there is the manifest peculiarity.  Interrogation is a pre-trial fact-finding procedure of its own that is administered in laborious written form to obtain sworn facts in a subsisting proceeding.

1. Refusing the application, Vickery J said:[66]

In my opinion, the Court does not have power to order the delivery of interrogatories or order cross-examination in aid of the power provided for in rr 32.05 or 37.02 of the SCR to assist a party to determine whether or not to issue proceedings.

…

In my opinion the power conferred on the Court by rr 32.05 and 37.02 does not extend to beyond the terms of those powers as they are defined in the rules to enable the Court to make ancillary orders of the nature sought in this case, namely the service of interrogatories and cross-examination in aid of a party deciding whether to commence a proceeding against a person.

[66]Ibid.

1. I do not think that the judge’s refusal, in the peculiar facts of Vic O Tech, to allow cross‑examination ascends to a general proposition that cross‑examination on an affidavit filed in a rule 32.05 application is beyond the purview of the power to be exercised under that rule. I think Vic O Tech is saying no more than this: the Court’s power under rule 32.05 is circumscribed to ordering a prospective respondent to give discovery of documents on satisfaction of the preconditions of the rule. Once that is done, and the power is spent, and an affidavit of disclosure is given, then the rule has done its work. Vickery J was saying no more than this: an applicant cannot, under rule 32.05, return to the Court and test the veracity of the disclosure as given, by asking the Court to enable the administration of interrogatories or cross-examine the deponent. That is because, by that time, the application under rule 32.05 is over and the Court’s power under the rule is spent. That is what was decided in the peculiar case of Vic O Tech.  But, in the present case, the Court was asked for leave to cross‑examine as part of the adjudication of the order 32 application. 

1. Like any interlocutory application, leave of the Court to cross‑examine a deponent can be sought, and it can be given as a matter of discretion.  But on an application of this nature, the grant of leave is exceptional.  As observed by Perram J in this respect in Pfizer:[67]

[I]t should be apparent that it will be unusual for it to be useful for a prospective respondent to conduct the application as if it were a preliminary trial.  The procedure is interlocutory and summary with cross-examination almost never allowed.  The Court should not indulge efforts to conduct a prospective respondent’s case if it were a dress rehearsal for a trial.

1. BCL’s written submissions did not descend to explain the factual basis and legal content of those posited causes of action.  As the respondents had submitted in writing, there is no tort of unlawful interference with property rights in Australian law, although there is a tort of causing loss by unlawful means.  In essence, that wrongdoing involves the use of unlawful means to interfere with the actions of a third party in which BCL has an economic interest, and an intention to cause loss to BCL either as an end in itself or to enable the wrongdoer to advance its own business interests by conduct that was known to be, in the nature of things, injurious to BCL.[146]

   [146]See Hardie Finance Corp Pty Ltd v Ahern [No 3] [2010] WASC 403, [685]–[698].

1. As the respondents also submitted, there is no tort of misrepresentation in Australian law.  Nor is there a relationship between BCL and the respondents such as to attract the law of contractual or pre-contractual misrepresentation.  There is, however, a tort of deceit.  That requires BCL to show that the respondents made a false representation to BCL knowing it to be false, or being reckless about its truth or falsity, and making it with the intention that it would be relied upon by BCL, and as a result of which BCL suffered damage.[147] 

   [147]See Tresize v National Australia Bank Ltd (2005) 220 ALR 706.

1. The tort of injurious falsehood mentioned by BCL involves the malicious publication of a false statement to third parties about BCL or its property, or its business, so as to intentionally cause loss, or where loss was the most natural and probable consequence of the false statement.[148]  This tort, I discern, was referrable to the contents of the presentation made by the respondents to the ABG in December 2016.

   [148]See Griffith v ABC (No 1) [2007] NSWSC 711, [3].

1. The remaining tort identified by Mr Phillips is conspiracy to injure.  That wrong is committed if two or more persons, acting in mutual agreement and with an intention to cause injury to another, carry out an unlawful act or carry out a lawful act by unlawful means.[149]  The requirement of an intention to injure is critical to liability.  It means that persons, even those acting collectively, may advance their own business or economic interests by lawful means even if a foreseeable consequence of their actions is the damage or disadvantage to the interests of another.[150]  

   [149]McKernan v Fraser (1931) 46 CLR 343.

   [150]JSC BTA Bank v Khrapunov [2018] UKSC 19; [2020] AC 727, 744 [10].

1. BCL does not identify the conspirators against whom it believes it may have a right to obtain relief.  In the operative context of this application, one would think that they would have to include the respondents as aspirants to redevelop the Panguna mine.  It does not appear that the JV Co or SMLOLA, or the MGU as non-parties to the application, are viewed as being in any secret plot to undermine support for BCL.  The facts, as I have exposed them, show the openly stated opposition taken by SMLOLA and Mr Miriori (and for a while, Mr Daveona in March 2017) to BCL being allowed to redevelop the mine.  But expressing opposition to the return of BCL is not unlawful.

1. Ultimately, in closing submissions, BCL relied on the absence of a requirement under rule 32.05 for an applicant to fully articulate the cause of action it may have in mind commencing.[151]  That is true to the extent that what the rule requires is a belief in ‘a right to obtain relief’.  But for that to be meaningful, and for the belief to have any conviction, the relief must derive from an identified and contended cause of action obtainable in proceedings justiciable in the Supreme Court of Victoria.  Eventually, for BCL, it was enough to say that there is evidence from the ASX announcement on 12 December 2017 that payments were made by Central to a team of landowners to assist in negotiations and awareness campaigns.  If the documents, as sought in this application, were to show those payments had been made to induce persons to refuse or object to BCL’s extension, then, so BCL submitted, it was ‘beyond argument’ that it may have a right to obtain relief; that is, relief of one form or another. But, I add, under rule 32.05 it would have to be relief obtainable in this Court.

   [151]See Beston Parks Management Pty Ltd v Sexton and Another [2008] VSC 392.

1. For that reason, BCL submitted it was not necessary for this Court to make any assessment of the lawfulness or otherwise of the payments made to the team of landowners.  It was enough, so BCL’s submission went, to show that there appeared to be or there might be ‘something wrong’ about such payments,  and the only way to find out was for the Court to order discovery of the documents by which payments were made, and that was especially so because Central had said in its announcement to the stock exchanges that the payments were ‘transparent’ and at ‘arm’s length’.  BCL expostulates: if the payments truly were ‘transparent’, then an order for discovery of documents showing the payments cannot therefore be regarded as invasive or fishing, or confidential or otherwise protected, or privileged from production.

1. But, Ms Magee, holding positions of responsibility in both respondents and as the contact person named in the ASX announcement of 12 December 2017, swore that to her knowledge RTG Mining and Central had not made any unlawful payments or given any unlawful benefits or inducements. 

1. BCL submits that I should not accept any of Ms Magee’s evidence because, for her to say ‘to my knowledge’ does not reveal the extent or source of her knowledge, and does not reveal what inquiries she or others on her direction had made, or what documents had been checked.  BCL submitted that for the publicly described ‘transparent’ and ‘arm’s length’ payments, Ms Magee should have stated what payments were made, to whom, and for what purpose, so as to dispel any apprehension that the payments may be unlawful.  The submission went further: in calling the payments ‘transparent’, but refusing to produce the documents evidencing the payment, served to show that her evidence should be treated by the Court as false or weightless.

1. I think those submissions went too far.  Ms Magee’s affidavit was responding to material in Mr Phillips’ affidavit, much of which did not rise above an insinuation of wrongdoing and did not state matters of fact with which to truly grapple in response.  I would not accept that the absence of any documents from Ms Magee to show the payments made to the team of landowners to assist in the awareness campaign and other exercises of that nature provides, in and of itself, forensic evidence of a concealment giving rise to a ‘reasonable cause to believe’ that the payments may have been unlawful - that is, an unwillingness to hand over all such documents meant she must have something to hide. 

1. In propounding the application, the onus was squarely on BCL to show objectively the grounds for believing that there were unlawful payments.  Without that, there was no call for Ms Magee at the behest of BCL to volunteer a detailed account of payments for the awareness campaign or other expenditures about when, how, to whom, and for what purpose payments were made.  To do that would in effect give de-facto discovery.  They are business documents that are innately private to the conduct of the joint venturer.

1. Nor do I accept BCL’s broader submission that, in this application, the issue is: did the respondents do anything unlawful to advance their interest in redeveloping the Panguna mine and might there have been ‘something wrong’ about the payments? I think that avoids a proper engagement with the dominant precondition of the rule and is, indeed, fishing to see what happened. Rather, the burden was wholly on BCL to first show by objective evidence that it was reasonable to believe that there may have been ‘something wrong’ with the payments, and not attempt to use rule 32.05 to obtain documents by Court order to try and satisfy the rule by looking to see if there was ‘something wrong’.

1. In closing spoken submissions, the elements of BCL’s case of saying that ‘something wrong might have happened’ came to be articulated.  It started with the statement that, by February 2016, the respondents were proposing in consultation with SMLOLA to obtain the project to redevelop the mine.  In order to advance themselves, the respondents had to first ‘get rid of’ BCL’s exploration licence.  BCL says the respondents went about that quest by:[152]

   [152]Transcript 136.

(a)        making a visual presentation to the ABG that contained misleading and deceptive statements about BCL’s historical mining at Panguna and the part that its mining played in conditions bringing about the civil war, and generally putting BCL in a bad or undeserving light;

(b)       taking ABG Ministers and government officials on a view of the Masbate mine in the Philippines (and suggesting that could be conferral of a ‘benefit’ under the Criminal Code);

(c)        as the ASX announcement of 12 December 2017 said, employing a team of Panguna landowners ‘at normal commercial rates’ to assist SMLOLA in negotiations, awareness campaigns and protecting the member’s rights’;

(d)       having Mr Duncan reportedly ‘dishing out cash’ to different individuals and groups’ in Panguna;

(e)        having RTG Mining giving funds of $1,472,368 to Central within the same time frame as the payments in (c)  and (d)  and which ‘disappeared’ as an accounting ‘impairment’; and

(f)        Mr Daveona’s change of mind in abandoning his support for BCL, and receiving K300,000 (from SMLOLA) towards his legal fees of the leadership proceedings, an event which led the Vice President of the ABG, Mr Masono, to issue a press release in which he is quoted as saying, ‘I am actually surprised that certain individuals can so easily sell their birthright for as little as K40,000 a month to a foreign company’, and ‘the ABG rejects companies that think they can bribe their way into the people’s resources by giving certain individuals money to gain landowner consent’. 

1. In closing spoken submissions, BCL also attended to the question of jurisdiction and actionability in this Court.  Its focal point became the announcements made by RTG Mining to the ASX and the TSX on 5 and 12 December 2017 concerning the Warden’s hearing.  The announcement on 12 December naturally attracted attention as it referred to the employment of a team of landowners to assist in awareness campaigns who ‘had been fairly compensated on arm’s-length terms in an honest and transparent manner and at normal commercial rates’.  BCL’s application sought the production of documents to show the payments made by Central to any representative or officer or member of SMLOLA, as had been referred to in that announcement.  BCL submitted that if those documents showed that the payments were in truth, unlawful or illicit, and therefore contrary to what was said in the ASX announcement, there may be an action to be taken in this Court by BCL for a contravention of the various statutory proscriptions in Australia, under the Competition and Consumer Act and the Corporations Act as well as the ASX Listing Rules, for misleading and deceptive conduct in trade and commerce, described as being a ‘statutory tort’. 

1. This strikes me as dubious, and as being extrinsic to the event about which BCL is aggrieved, that is the Minister’s refusal of its extension application.  As a general proposition, it may be accepted (as it was by the respondents) that there can be a misleading and deceptive statement made in Australia in contravention of Australian laws, even though the subject matter of such a statement concerned facts and matters that had occurred outside Australia.  But, the announcement to the ASX was a statement to the market at large.  Real and serious questions or legal problems would arise about identifying who was misled and deceived, and in what particular way, as would legal issues about reliance, causation, and damages.  Moreover, and more importantly, I cannot see how a possible action based on that ASX announcement translates or commutes to the loss to BCL, being occasioned by the making of a decision by the responsible Minister of the ABG to refuse BCL’s application for an extension of the exploration licence.

1. BCL also looked to the announcements made by RTG Mining to the ASX on 5 December 2017 to prospectively stake a claim in this Court.  That announcement concerned the reconciliation agreement between Mr Miriori and Mr Daveona.  Nothing in that announcement concerns payments.  The announcement concerns SMLOLA’s involvement as joint venturer and says: ‘The SMLOLA are the only landowner association whose consent is required for the issue of an exploration licence’.  As I understood BCL’s submission, that statement to the market might be actionable in Australia as being misleading and deceptive for two reasons. First, because SMLOLA is not an approved landowner association under the 2015 Mining Act.  Nor is it the ‘only’ landowner association (so the MOU showed), as there are other landowners and associations of other customary land to be used for ancillary post-extractive operations of the mine.  Secondly, the statement was said to be misleading and deceptive because SMLOLA’s ‘consent’ is not required for the issue of an exploration licence.  BCL says the only legislative requirement for an explorer, before it can enjoy the use of a licence, is under s 105 of the 2015 Mining Act, to make a land access and compensation agreement with the customary landowners over the land to be explored.

1. As the MOU indicates, there were seven or eight other landowner associations and stakeholders in Panguna, if one includes all land additional to the actual mine area. But this announcement to the ASX on 5 December 2017 concerns specifically the exploration licence which is over the land that comprises the former Special Mining Lease area.  As I follow the facts, that brings in SMLOLA (the joint venturer) as the relevant association of customary landowners, approved or not.  Whether it is called consent (a point of legal argument) or the statutory term ‘permission’, or the political term ‘social licence’, it was the extent of the objections made at the Warden’s hearing to BCL that explained the refusal of the extension application. 

1. This too was an ASX announcement to the market at large. Nothing in it concerned payments and the outcome of the extension application. Nothing is referable to any of the documents as sought in this application. Above all, if BCL regard that statement to the ASX as misleading and deceptive, then it is already in a position to commence proceedings without recourse to rule 32.05.

1. Thus, for the purposes of this application and in understanding the relief that might be sought, I do not understand BCL to be focussing on the various tortious causes of action as it originally identified for interference with its economic interests.  Questions could well arise as to whether BCL truly had proprietary or economic interests in the relevant sense.  Its exploration licence had expired.  It no longer had a tenement.  What it had was a statutory right to apply for an extension of its expired licence, which it exercised unsuccessfully. 

1. I hope I do no disservice to BCL’s submissions, and I make no criticism, but in the way the application was propounded, the approach was not to analyse the availability of the prospective causes of action as identified by BCL, but to contend that there was sufficient in the evidence to give grounds for a belief that something legally wrongful might have happened at the hands of the respondents involving the payment of money to take away the support for BCL as redeveloper of the Panguna mine, with the result that it was denied an extension of its exploration licence.  The twist is that in the review proceedings, a good part of BCL’s attack on the Minister’s decision is the failure to correctly recognise and count the landowners of blocks forming Special Mining Lease 1 who supported BCL to the extent of forming a majority. 

The reasonableness of BCL’s grounds for a belief

1. The respondents contend that BCL’s application is based on nothing more than a hunch or suspicion or speculation and there is no evidence to show that something wrongful has happened to, in effect, influence landowners to swing away from BCL and object to the extension.  They contend, in essence, that the documented facts show that the landowners in SMLOLA, who were in joint venture with Central, were openly hostile to the return of BCL, and although there was a period between March and December 2017 when Mr Daveona (as distinct from the constituency of SMLOLA) expressly supported BCL (along with the ABG), the fact is that the landowners did not.  Their views were heard at the Warden’s hearing and their objections came to necessarily inform the decision to refuse.   

1. I would make the following findings or evaluations from the evidence.

Findings and evaluations 

1. First:  after the commencement of the 2015 Mining Act, the respondents were as mining entrepreneurs entitled to pursue an opportunity to take steps to redevelop the Panguna mine, even if that meant supplanting BCL.  To that end, by February 2016, Central had entered into a joint venture agreement with SMLOLA and the MGU.  The respondents believed that the pre-existing BCL exploration permit had expired.  That belief was created by what they were told by the ABG, which is not only responsible for administering the 2015 Mining Act and granting mining tenements, but was also a substantial shareholder in BCL. 

1. Second:  the respondents appear on the evidence to have been acting without stealth in their pursuit.  They were invited by the ABG to make a presentation about their joint venture proposal to redevelop the mine.  There was nothing improper or conniving in hosting ABG officials to a visit to the Masbate mine in the Philippines.  Indeed, it would be a proper exercise of the duties of a Minister and other officials to go and see the mine for themselves, especially as the presentation offered the ability to deliver ‘World’s Best Environmental Practices’.  

1. Third:  statements made in the respondents’ documented presentation to the ABG - ‘The New Panguna Mine – A Panguna Landowner Initiative For All Bougainvilleans’ - could realistically be regarded as statements to the discerning and well informed, and not the gullible.  Within the content of the presentation, government officials would have been well aware of the historical and economic matters in Bougainville and the enduring legacy issues from BCL’s past conduct of the Panguna mine.  The representations are all documented in the presentation material. If any of those representations were thought by BCL to be misleading and deceptive, they may be actionable by BCL in Bougainville under the applicable local law.  In pre-application correspondence, BCL declined the respondents’ invitation to identify any misrepresentations to be corrected.  In any event, the conduct of the presentation to the ABG has no bearing or relevance at all on the Minister’s decision on the extension application. 

1. Fourth:  what distinguished the respondents’ pursuit, was the involvement of SMLOLA as joint venturer.  The customary landowners were given ownership of minerals under the 2015 Mining Act.  It appears to be sound and commercially and politically appealing, or stabilising, to satisfy all interests with a well-resourced mining outfit and customary landowner as joint venturers.  Fundamentally, it simply makes no sense to believe that Central would have to bribe the members of SMLOLA, its joint venture partner, to take objection to BCL.  It is plain, on the documented evidence, from those who were speaking publicly for SMLOLA without inhibition that the post-civil-war sentiment amongst those landowners of what once was the ‘Special Mining Lease’ area is one of antipathy to BCL.  It is clear there were simmering grievances about unpaid or overdue compensation to the landowners for the environmental and other damage done by mining at Panguna.  The legacy issues for BCL were real and burdensome and a simmering source of resentment. Despite that, it seems from about March 2017, the ABG (as shareholder) and its newly appointed Minister came to show support for the prospect of BCL becoming the mine redeveloper, an alignment which seemed to intensify the landowners’ opposition.  I detect from the materials that the legacy issues of due compensation to customary landowners became, politically, a contest between ‘better the devil you own’ (and in which the ABG was a substantial shareholder) as against the Miriori or SMLOLA view that ‘the leopard does not change its spots’. 

1. Fifth:  I venture to say that the politicised question of suitable redeveloper of the mine unavoidably permeated the leadership dispute between Mr Miriori and Mr Daveona, to the extent that it would not have been in BCL’s interests or the ABG’s interests to have Mr Miriori as Chairman of SMLOLA.  That might explain Mr Daveona’s claims to be the Chairman of SMLOLA and why Mr Miriori had to take legal action to restrain Mr Daveona from so acting.  In all of this, there is no evidence that the customary landowners (the rank and file as distinct from the leaders) had a change of mind and became willing to support a return of BCL.  The objective evidence is glaringly to the contrary, for the customary landowners had already refused to make any agreement to give BCL access to any land that was the subject of BCL’s two-year exploration licence.  That of itself reveals manifestly the pre-existing hostile attitude of the landowner members of SMLOLA towards BCL. 

1. Sixth:  after the joint venture agreement with SMLOLA in February 2016, one can isolate for special interest the period between March 2017 and the making of the reconciliation deed in December 2017, and then the Warden’s hearing on 11 December 2017.  The facts are perplexing and not transparent, but they do not support an inference of bribery.  What emerges, however, is that as at March 2017, Mr Miriori and Mr Daveona were jointly anti-BCL, and then Mr Daveona became pro-BCL in line with the ABG showing its support of BCL, but he then resumed an anti-BCL or pro‑RTG Mining position when legally challenged about holding himself out as Chairman of SMLOLA.  At all times, SMLOLA remained as joint venturer with the respondents.  As I have said earlier in this judgment, there was no ‘conversion’ by Mr Daveona.  It was merely shifting political sands.  The concentration in this application has been on the politically charged attitudes and allegiances of the operatives: Mr Miriori, Mr Daveona, and some in the ABG.  But the attitude of those that truly matter the most - the customary landowners - came to be shown at the Warden’s hearing, where they spoke with their objections to BCL and were heard.  Ultimately, their objections were enough to lead to a refusal of the extension application by the ABG whose interests may well have remained with BCL, but whose fidelity had to remain with the operation of the 2015 Mining Act and the views and unity of the landowners.

1. Seventh:  Central’s relationship of being in a joint venture with SMLOLA would have necessarily and undoubtedly had outlays and expenses of many varieties for such a major undertaking with customary landowners.  They were both operating under a new and different statutory regime, and with uncertainty and apprehensions in the post-civil war and political milieu in Bougainville.  The landowners had become mineral owners and subject to new laws and governance.  It is reasonable to think that the respondents who were new to Bougainville (and described publicly by the Minister in the political discourse as ‘foreigners’) would, as newcomers to Bougainville and acting by means of a joint venture with landowners, be bound to make expenditures and payments of various types as part of the joint venture and a campaign to garner support and confidence from the customary landowners.  It seems to me natural to suppose that the respondents would be expected to engage in meaningful and direct activities such as ‘awareness campaigns’ or the spread of information and other such activities with SMLOLA as joint venturer.  For such activities, people (more likely within the customary landowners) would have to be employed and properly paid.  These are more capable of being seen as payment for joint venture programs and expenses rather than bribes or illicit payments.  I think that is  the sense in which the payments could be described as transparent.  Far too much has been made of the verbiage of the announcement to the ASX on 12 December 2017. 

1. Eighth:  I think BCL’s reliance on the accounting entry of ‘impairment’ expenses of US$1,472,368 in the 2017 Annual Report of RTG Mining was clutching at straws.  Just because an expense or debt is not considered to be recoverable as an asset with a carrying value does not give grounds to believe that RTG was somehow financing a bribe or illicit payment presumably to SMLOLA or Mr Daveona.

1. Ninth:  I think too much was made by BCL of the reference made in correspondence, in March 2017, within the Ministry of Minerals and Energy Resources to a request for a travel ban concerning Mr Duncan, who was reported as ‘dishing out cash to different individuals and groups’, and questioning the conduct of awareness campaigns.[153]  The Office of Panguna Mine Negotiations was not itself asking for a travel ban and advancing its own grounds for such a ban.  The letter contains inadmissible hearsay allegations made by others identified only as ‘SML Leaders’ and ‘SML Executives’ to people only identified as ‘different individuals and groups’.  I do not regard this letter as having any probative force to justify a reasonable belief that bribes or illicit payments were being made.  The letter is politically charged against Duncan and Central as there was at the time, as the letter says, the prospect of the ABG engaging with BCL to redevelop the mine. 

   [153]Phillips Affidavit, exhibit CP-21.

1. Tenth:  the only reference in all of the facts of this case to ’bribe’ was uttered by Mr Masono as the responsible Minister and the Vice President of the ABG in his Press Release in December 2017.[154]  The use of the word ‘bribe’ was in the context of the deed of reconciliation made between Messrs Daveona and Miriori about which Mr Masono expressed his surprise ‘that certain individuals could so easily sell their birth right …’  That hearsay document could not be admissible as evidence of the truth of its statements but only for the fact that it was said, if that be relevant as original evidence.  Therefore, the fact that it was said does not give it any probative value. 

   [154]Ibid, exhibit CP-20.

1. I mean no disrespect, but in the sudden circumstances of its publication, these statements cannot be viewed as facts or as serious allegations of bribery.  If Vice President Masono truly knew or had grounds to believe that a crime of bribery had occurred, then presumably steps would have been taken to investigate and prosecute the wrongdoer.  That is why, I think, that the Vice President’s statements on which BCL seems to place much weight should be seen as no more than dramatic political comments in response to the loss of Mr Daveona’s support for BCL (in which ABG was a shareholder).  That change occurred not surreptitiously, but came about after a mediation conducted by a Judge of the National Court.  

1. The subsequent Press Statement by President Momis, on 21 December 2017, which announced the moratorium was of a different character.  He said pertinently: ‘[W]e will not allow this project once again to reignite the wounds of the Bougainville crisis and distract our focus for restoring peace and our preparation for our referendum in 2019’.[155]  I think such a statement only serves to show that amidst the complicated and dense facts, there is a bigger picture in this case on which a judgment should be based on this application; that is, to see outside the details, the significance of the history, and the legacy issues that dogged BCL and that affected the customary landowners to openly oppose the return of BCL for many years.  The competing hypothesis from BCL is that the opposition to BCL was (by reference to an ASX announcement) induced by bribes or illicit payments made to a team of landowners undertaking awareness campaigns, and maybe payments and inducements paid to a mercurial Mr Daveona.  This lacks evidence as well as reasonableness. 

   [155]Magee Affidavit, exhibit JAM-7.

1. Eleventh:  as BCL’s exploration permit was granted to it as a priority or privilege under the 2015 Mining Act, the extension application became the first post-civil war occasion of BCL being put to a test of acceptability by the customary landowners under post-civil war conditions and new laws.  In those conditions, what the respondents offered was a joint venture legal relationship that enabled the customary landowners to be part of the commercialisation of their own newly granted interest in the minerals under their land.  It seems to me that with all the ‘heavy baggage’ of the legacy issues, this is what BCL was up against in obtaining what was termed the ‘social licence’ to redevelop the mine.  Even though the ABG was a shareholder in BCL, legal process required the view and objections of the customary landowners to be considered, and in any case, they had previously withheld their agreement under the 2015 Mining Act to allow BCL to have access to the land to be explored. 

1. Twelfth:  the materials do not readily reveal a situation of an astonishing result in the decision to refuse, so as to arouse naturally a belief that ‘something has gone wrong’ or something has corrupted the refusal decision.  The refusal, based on an absence of a social licence, could not be said to be objectively incredible or surprising or that ‘something had gone wrong’.  It was in tune with what both Mr Daveona and Mr Miriori had jointly said on behalf of SMLOLA and the MGU in their joint press release in March 2017: ‘[S]top BCL once and for all’.  Come December 2017, and away from the leadership and political machinations, it was the landowners who spoke and who were heard at the Warden’s hearing.  The Minister’s refusal decision followed commensurately.  

1. For those accumulated reasons, I do not think that BCL has adduced the evidence to show reasonable grounds under rule 32.05 for its ostensible belief that it may have a right to obtain relief in this Court for which to seek pre-action discovery. When one considers the hard, objective, and prevailing historical facts that greatly compromised BCL’s position for any prospect to redevelop the Panguna mine, any assertion that something wrong has happened in the refusal decision referrable to a corruption of its previous supporters comes off an extremely weak base. On reflection, I think BCL’s application proceeds not on a belief. It proceeds on a hypothesis that there might have been bribes and illicit payments, and it is using rule 32.05 to obtain documents to try and prove or disprove a hypothesis. In my view, that is not a legitimate use of rule 32.05.

1. My evaluation of the grounds of belief makes unattainable by pre-action discovery any of the documents sought in paragraphs 47(i), (ii) and (iii), and also paragraph 47(v) of Mr Phillips’ affidavit, which concerns payments of any Criminal Code ‘benefit’.  To the extent that paragraph 47(v) refers to benefits provided by RTG Mining, there was no evidence in this application that RTG Mining was involved in making payments, given the particular role it played as the provider of technical expertise and in raising capital.

1. Paragraph 47(iv) of Mr Phillips’ affidavit seeks two classes of documents by separate reference to the stock exchange announcements on 5 and 12 December 2017.[156]  The first announcement was the reconciliation agreement that confirmed Mr Miriori as Chairman of SMLOLA and said that SMLOLA had entered into a joint venture agreement under which RTG Mining was nominated as the preferred developer.  The second announcement (the day after the Warden’s hearing) included a statement that SMLOLA had lodged an objection to BCL’s extension application before the hearing, on the ground that the application was lodged out of time, but SMLOLA chose not to stop the Warden’s hearing.

   [156]Phillips Affidavit, exhibits CP-16 and CP-17.

1. To ask for pre-action discovery concerning the joint venture arrangements under which RTG was nominated is far too broad and is invasive.  I would not allow it.  In the way the application was conducted, it is not apparent to me how such documents would come to inform a decision by BCL whether to commence proceedings on the grounds contemplated.  Likewise, I cannot see the link between SMLOLA’s abandoned objection to the conduct of the Warden’s hearing and the grounds of this application, and how such a class of document would assist to make a decision whether to sue.  In both cases, I think the discovery is being sought improperly as part of a broad investigative exercise.

Conclusion and proposed orders

1. My decision therefore is to wholly refuse this application.  I would wish to add that with all the complexities in this case as I have endeavoured to expose them, I see no unjust deprivation in this outcome.  As things stand (as far as I know), BCL’s review proceedings in the National Court are still pending.  That proceeding turns on known or available facts and a statutory regime, and not facts to be still discovered.  In the review proceedings, BCL contends that majority support from the customary landowners for its extension application was not needed as a matter of law, but contends that if it was needed, then BCL had majority support from the landowners which was not properly assessed or recognised in the way the Warden’s hearing was conducted.  If BCL succeeds in quashing the Minister’s refusal decision, it will do so on substantive legal and factual grounds on the question of whether it truly did have the requisite support of the customary landowners, rather than insinuations of bribery and corruption which, so I have concluded, lack a reasonable basis on the objective evidence.

1. I will order that the application be refused, and, that the originating motion be dismissed.  I can see no patent reason why the costs of the application should not follow the event, and to be taxed on the standard basis.[157]  If any party seeks to move the Court for any different or ancillary orders, I would invite sequential written submissions first from the respondents by 14 May 2021 and then in response from the applicant by 21 May 2021.

   [157]See rule 63.30 and rule 63.31.

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