Edwards & Ors v Santos Limited
[2010] HCATrans 318
[2010] HCATrans 318
IN THE HIGH COURT OF AUSTRALIA
Office of the Registry
Sydney No S153 of 2010
B e t w e e n -
NOELENE MARGARET EDWARDS AND CLANCY McKELLAR AND IONA DAWN SMITH AND ERNEST (HOPE) EBSWORTH AND ROSEMARY (ROSE) ANNE WILSON AND MARGARET ANNE COLLINS AND SHARLEEN LOUISE KNIGHT AND ARCHIE EBSWORTH
Plaintiffs
and
SANTOS LIMITED (ACN 007 550 923)
First Defendant
STATE OF QUEENSLAND
Second Defendant
DELHI PETROLEUM PTY LIMITED (ACN 007 854 686)
Third Defendant
THE FEDERAL COURT OF AUSTRALIA AND THE JUDGES THEREOF
Fourth Defendants
FRENCH CJ
GUMMOW J
HAYNE J
HEYDON J
CRENNAN J
KIEFEL J
BELL J
TRANSCRIPT OF PROCEEDINGS
AT SYDNEY ON WEDNESDAY, 1 DECEMBER 2010, AT 10.17 AM
Copyright in the High Court of Australia
__________________
MR J.A. McCARTHY, QC: May it please your Honours, I appear with my learned friends, MR J.F. KILDEA and MR A.L. TOKLEY, for the plaintiffs in this matter. (instructed by Eddy Neumann Lawyers)
MR B.W. WALKER, SC: May it please the Court, I appear with my learned friends, MR S.B. LLOYD, SC and MR S.R.R. COOPER, for the first and third defendants. (instructed by Blake Dawson Lawyers)
MS R.J. WEBB, QC: May it please the Court, I appear with MS H.P. BOWSKILL and MR G.J.D del VILLAR for the second defendant. (instructed by Crown Solicitor (Qld))
FRENCH CJ: There is a submitting appearance for the fourth defendant. Yes, Mr Solicitor.
MR S.J. GAGELER, SC, Solicitor‑General of the Commonwealth of Australia: If the Court pleases, I appear with MR R.G. ORR, QC and MR B. LIM for the Attorney‑General of the Commonwealth intervening. (instructed by Australian Government Solicitor)
FRENCH CJ: Yes, Mr McCarthy.
MR McCARTHY: Thank you, your Honour. Your Honours, this is an application to show cause. In the formal papers in the application book, the application appears at page 1B, and the relief that is sought is set out at page 2 of the application book, orders 1, 2 and 3, and there is an affidavit in support of the application. That is at 5A, and I would read that affidavit. Your Honours, I do not understand that there are any objections to the affidavit.
FRENCH CJ: Yes.
MR McCARTHY: Thank you.
CRENNAN J: May I ask you a question about the declarations sought, which are to be found at application book 13 and 14? I wanted to ask you, if I may, about the declaration numbered 2. I think it has been suggested by others that there is a silent premise in the declarations sought, and I think it would come in after the date “31 January 1979”, that you would need to have something like “if it is a future act under section 233 of the Native Title Act” - and I just wanted to be clear whether that declaration is premised on the idea that the grant of a petroleum lease covered by that authority would be a future act. Is that what the declaration is getting at?
MR McCARTHY: It would be a future act in the context in which those items were in actual fact fulfilled, your Honour, to put the point, that is, that if the requirements of the subdivision were in actual fact met as required under the Act then that would be a valid Act.
CRENNAN J: Section 24ID would come into play if the grant was a future act. Is that not right? I am only trying, for my own purposes, to clarify what is sought by paragraph (d).
MR McCARTHY: In the sense that what 24ID is referring to, your Honour, is a species of future act. Your Honour is correct.
CRENNAN J: Thank you.
KIEFEL J: Your point is that it could not be a pre‑existing rights based Act?
MR McCARTHY: That is correct, your Honour.
KIEFEL J: Which makes it perhaps less attractive for Santos in relation to an ILUA, that is what they are saying?
MR McCARTHY: It may be more attractive to Santos, but Santos may answer that themselves, your Honour.
KIEFEL J: Well, perhaps we should let you develop your argument there. Whilst you are interrupted could I ask you, in your reply you take the matter beyond the Petroleum Act in paragraph 9 of your submissions in reply and say that – paragraph 10, that if Santos could not have a petroleum lease under the Petroleum Act, nevertheless there could be granted something under the Petroleum and Gas (Production and Safety) Act 2004?
MR McCARTHY: That is correct, your Honour.
KIEFEL J: Is this the first time that that Act has been relied upon?
MR McCARTHY: In these proceedings?
KIEFEL J: Yes.
MR McCARTHY: It is the first time that it has been mentioned specifically in those terms, yes.
KIEFEL J: Could you just clarify just what is involved there? Your first point is that a petroleum lease could not issue validly under the Petroleum Act 1923 (Qld).
MR McCARTHY: That is correct.
KIEFEL J: But, nevertheless, a lease over the same land could issue under the Petroleum and Gas (Production and Safety) Act 2004.
MR McCARTHY: Yes, that is correct.
KIEFEL J: But that would not be for Santos’ purposes. It would not be a pre‑existing rights based Act.
MR McCARTHY: It certainly would not.
KIEFEL J: But it would be a future act.
MR McCARTHY: It would be and it would carry the full connotations in relation to Subdivision P. The point of the matter being, your Honours, is that Queensland had a breakdown in terms of the changeover in terms of their legislation and they preserved under the 1923 Act all those authorities which predated the Native Title Act and allowed the PERBA regime, for want of a better, to persist in relation to all other interests. In respect of gas and petroleum, the leases and other licences would not be PERBAs and would be, of course, subject to the right to negotiate provisions of the Native Title Act. Thank you, your Honour.
Your Honours, the judgments in the Federal Court whereby a plaintiffs’ application is summarily dismissed and leave to appeal refused discloses jurisdictional error in two principal respects; in the finding that the Federal Court did not have jurisdiction to hear and determine the plaintiffs’ application in relation to the Native Title Act because it was an impermissible attempt to secure an advisory opinion and that the Federal Court did not have accrued jurisdiction to hear and determine the State law question, I would call that the federal jurisdiction issue and, secondly, that the plaintiffs’ application had no reasonable prospects of securing any of the declaratory or injunctive relief which they seek and for which the application was dismissed and leave to appeal to the Federal Court was refused. In other words, there is the jurisdiction matters issue, and there is the reasonable prospects issue in relation to the orders that we seek to have quashed.
I turn now to the relevant parts of the judgment in the application book and I ask if your Honours would turn to that with me. First of all as to the jurisdiction issue I take your Honours to the following sections. There will be a framework of submissions in relation to these points as a part of my submissions, your Honours, but I want to identify this, the parts of the application book, at this particular time with you. If your Honours would note at page 43, paragraph 43. It is the first paragraph that discloses significant error of the type that we are attacking:
Read with the relief sought by the Applicants, the amended statement of claim offers, in my opinion, a paradigm example of an impermissible attempt to secure an advisory opinion. What is revealed is nothing more than a difference ‑ ‑ ‑
FRENCH CJ: I do not think you need to read the passages to us.
MR McCARTHY: I am sorry. I am just saying the rest of the paragraph there and the next paragraph in relation to, paragraph 44, and I just draw your Honours’ attention to it, the line in the centre:
The hypothetical nature of the application is self evident.
FRENCH CJ: I suppose one area of particular concern is how the declaratory relief fits into the context of the ILUA process, and for that we need to look at the statute, do we not, in terms of the ‑ ‑ ‑
MR McCARTHY: Yes, your Honour.
FRENCH CJ: Yes. I just wonder whether the statute is not a good place to start in the context of defining the rights that you are seeking to assert or protect in relation to the declaratory relief.
MR McCARTHY: I would accept that, your Honour, and propose to do so, but I was just commencing for the Court with identifying where in the application book where the sections in the judgments that I was identifying as being the subject of challenge and the orders that we sought to have reversed. I will move quickly through that if ‑ ‑ ‑
FRENCH CJ: We have read the judgments and we have read your submissions.
MR McCARTHY: Thank you, your Honour. In those circumstances, your Honour, if I can take it that the sections of the judgments are in actual fact ‑ ‑ ‑
GUMMOW J: Is there any particular paragraph in the Full Court?
MR McCARTHY: Yes, your Honour, I think it was, if I might ‑ ‑ ‑
GUMMOW J: We can just look briefly at that.
MR McCARTHY: I will not read the paragraphs, your Honour. There is the paragraph at 304 and ‑ ‑ ‑
GUMMOW J: Paragraph number?
MR McCARTHY: It is paragraph 24 and ‑ ‑ ‑
GUMMOW J: Paragraph 25 really.
MR McCARTHY: Paragraph 25 and I would identify, your Honour, paragraphs 20 and 21.
HAYNE J: Do those paragraphs of the judgment proceed on the premise that the relevant right to identify is a right in the present applicants?
MR McCARTHY: Do those judgments proceed on that basis?
HAYNE J: Yes.
MR McCARTHY: Yes, your Honour, they do.
HAYNE J: I wonder whether that is the only way in which the proceedings in the Federal Court are properly examined. It seemed to me that it is at least a possible point of view that the declarations that were sought, pages 13 and 14, particularly the declaration at paragraph 14 coupled with the injunction at page 14, paragraph 6, directed attention to the nature of the rights held, or asserted to be held, by the petroleum defendants.
MR McCARTHY: Yes, your Honour.
HAYNE J: If that is right, then the question becomes whether the applicants have a sufficient interest to obtain a declaration about, or injunctive relief in connection with, rights which are asserted by the petroleum defendants, namely, the rights which they say attach to the ATP and any lease that may be granted in consequence of the ATP.
GUMMOW J: If I can add, it is at that stage and in that way that one only gets into this question of hypothetical.
MR McCARTHY: That is correct.
GUMMOW J: Namely, is your interest no more than a hypothetical concern that should not really found this sort of declaratory relief? You say no, I suppose?
MR McCARTHY: I do say no, your Honour, but I say no for a series of reasons that may be put further in terms of the framework of the Act.
CRENNAN J: For my part, might I just add this, that what I would like to better understand is this. The petroleum defendants say, well, they are not obliged to include the grant of this lease in the ILUA, not obliged to include it in the negotiations, that is, there is no compulsion on them. They are coming to these negotiations voluntarily, and I am not sure and I would like to understand your position how you do get a controversy and, indeed, utility in the declarations in those circumstances.
I do understand that you say that section 24CB does not preclude the inclusion of the grant of the leases pursuant to the permit and I also understand that you point to the fact that 24ID, in a sense, has the potential to operate to protect the petroleum defendants in the future. What I am having difficulty understanding is how you put your claim for relief in circumstances where, as I understand it, and I would like to be told if I am wrong, the petroleum defendants are saying, well, there is no obligation on us to include this particular subject matter in either the negotiations or the ILUA that will flow from the negotiations.
MR McCARTHY: Thank you, your Honour. Your Honour, that is certainly the gloss in the submissions that have been put in various curial contexts. In relation to the actual negotiations themselves it was not a general issue in relation to petroleum leases, it was not a general issue in respect of the material for inclusion in the ILUA that was put by the now petroleum defendants. Their point was that they were not including the ILUA - in the ILUA or negotiating about those matters, that is, petroleum leases, because in their view at law they were PERBAs and they were already covered in terms of validity and there was ‑ ‑ ‑
CRENNAN J: If a court found they were not PERBAs, does it alter the position in terms of them deciding, well, our choice may not seem rational to others but we do not wish to include the petroleum leases in the ILUA? In other words, they are saying, we understand 24ID but as it happens we do not wish to take advantage of it, of that section. Do you see what I am trying to say?
MR McCARTHY: I do.
CRENNAN J: I just want to understand better your right, as it were, to somehow compel the petroleum defendants to have the petroleum lease as part of the negotiations if they take the view that they do not wish to take advantage ultimately of section 24ID.
MR McCARTHY: Your Honour, there are things about this context which show that the answer to what you put is at certain levels. The first is this, that we are talking about a specific concrete situation, a specific dispute that has arisen in ILUA negotiations which relate to the Native Title Act and that what is being sought – and these are negotiations between parties that have been negotiating for a long time over various matters – in the ILUA has been comprehensive detail, comprehensive arrangements in relation to a whole series of issues, including mining and other matters, and that this issue has arisen on a number of occasions in relation to – that is the PERBA issue – these negotiations.
What we submit, your Honour, is this, that in the context of a search for a further comprehensive settlement in relation to the ILUA, the negotiations at this point have broken down over this issue, on an issue of law, as to whether mining leases in relation to the ATP area and the claimed land are, in actual fact, matters for which the Act is taken, that is the NTA, is taken care of in terms of validity, and that is the view that is taken by the petroleum respondents. That is not the view that is accepted by the plaintiffs who have good reason to believe that the ATP is invalid.
In those circumstances, they say, where there has in their negotiations to date been a dichotomy between consents and licences under petroleum legislation and things that are regarded as PERBAs, that there would need to be a change if that is in actual fact the case that the petroleum leases would not be PERBAs. Now, that is not something at the moment that can be taken any further. It is a straight out issue of law between two parties to negotiations in the part of a statutory process that needs to be otherwise resolved.
KIEFEL J: It is an unusual situation, though, because usually in the course of negotiations when there is, as you say, these two totally opposed points of view there is seen to be some benefit in having a resolution of it. Here the oddity is that the petroleum defendants assert that they are not interested, that, in effect, they are willing to take their chances with how things fall out. I appreciate what you are saying, that you may view the entitlement to declaratory relief on different levels, but at the factual level where this – if we are looking for the controversy, if we consider that firstly, it arose in the context, I think, in the correspondence where there is an issue about whether or not some pastoral leases should be granted by the petroleum defendants to the registered native title interest group.
MR McCARTHY: That is correct.
KIEFEL J: And the price for that was suggested to be consent to the petroleum leases and the explanation given by the petroleum defendants was, “Well, we do not need that consent because we have a PERBA, a pre‑existing right, as a future act, so an ILUA is not worth much to us”, to which the plaintiffs counter, “Well, you are wrong about that. You do not have a PERBA. A lease would be invalid because there was no interest.” Normally you would think a resolution would be sought by the parties, but here the oddity, as I have said, is the petroleum defendants assert at least no particular interest in whether that is right or wrong, in which case it has the appearance at least of a declaration being used to persuade them to the contrary.
HAYNE J: Or, alternatively, it provokes the question, what is the interest of the applicants in obtaining a declaration of the petroleum defendants’ rights? There are two forms of declaration that might be seen as relevant here; a declaration of your party’s rights, a declaration of Santos and Delhi’s rights. At least one of the declarations sought seems in terms to be a declaration about the petroleum defendants’ rights. Then if you go to Forster v Jododex 127 CLR 421, particularly at 437 and 438, and other authorities about declaration, the question becomes, is the question real and not theoretical, does the person raising it have a real interest? Now, in this case, if your side has a real interest in raising this, it seems that the question of reality as opposed to theoretical question is beginning to merge with that question of interest.
MR McCARTHY: Yes, your Honour.
HAYNE J: Well, where are we going to go, Mr McCarthy? Where do we begin?
MR McCARTHY: Well, your Honour, we would go to what the nature of the dispute is in terms of where the parties are heading and what they have put.
GUMMOW J: If you are going to find a real interest, it has to be a real interest which is linked to, not spring out of, the relevant provisions of the Native Title Act which provide the framework for the whole of this controversy.
HAYNE J: If you go up the gully of the dispute, you end up in the point of one party saying, “Not a subject we are presently interested in.”
MR McCARTHY: But they are, your Honour.
HAYNE J: Well, you say they are. They resolutely assert they are not. We are going to end up in an at least unedifying, likely unproductive, debate about that question of fact. Surely we begin in the Act and the interest the applicants have, if there is one.
MR McCARTHY: Well, that is so, your Honour, but if I could just put it in terms of the concrete dispute as the matter has come forward. Could I take your Honours to page 114 of the application papers where there is set out the first part of what is on the table in relation to where the parties were at and where the negotiations were about. I draw your attention to the recital:
The parties to this Agreement have reached a comprehensive settlement of outstanding matters between the parties. The Joint Venture Parties receive certainty in its dealings with respect to native title and cultural heritage. The Native Title Parties receive certainty in the involvement in cultural heritage management in the Joint Venture Parties dealings with the Project Area as well as compensation, employment and other benefits.
Could I take your Honours over to page 138 as to what the terms and details of the project rights are for which the plaintiffs’ consents have been sought and are sought again, 9.3:
The following are some possible examples of Project Rights within the ambit of the definition in clause 9.1 above. They are provided as examples only and shall not be taken to limit or restrict the definition of “Project Rights”. Examples include –
and I draw your Honours’ attention to (c) and I draw your Honours’ attention to 9.4:
The Joint Venture Parties consider that the State can grant to them various petroleum tenements . . . pursuant to Part 2, Division 3, Subdivision 1 of the NTA. Nothing in this Agreement contends that the Native Title Parties agree with this position. The Parties agree that the term “Project Rights” does not include any petroleum tenements granted by the State as PERBAs during the currency of this Agreement.
That was the situation, your Honours, in O1. The situation since then is that the native title parties have written, as your Honour Justice Kiefel has referred in relation to a change in relation to compensation and that is set out, your Honour, the details of that, at page 13 of the pleadings where we set out what has happened. I beg your pardon, I said the wrong page, it is page 18, and in paragraphs 4 to 4B, there is set out what has happened. From late 2005 there had been various things that were put forward and then in 5 there is recited what came about in terms of actions concerning the letter and the position of the petroleum defendants. Then there is the sequence of events down to 6 and 7.
Your Honours, what we say is the situation in relation to the material there and goes to answer the Court that has been put to me at this level, that what the material – or what the events disclose is that there is nothing that has been said in terms whereby if there was a situation where it is clear that the ATP is invalid that there are no PERBAs in respect of petroleum leases, that in that context there would not be a successful conclusion to the ILUA ‑ ‑ ‑
FRENCH CJ: Can I just ask you one question? What difference does it make to your assertion of interest and a right to declaration that you were engaged in an ILUA process? Would it be any different if you were simply exchanging correspondence with them, they saying that if they got a petroleum lease it would be a PERBA and you saying no, it would not, it would be a future act and you would need to think about dealing with this under Subdivision P?
MR McCARTHY: We being the native title claimants?
FRENCH CJ: Yes. I am just wondering what difference the ILUA framework makes here?
MR McCARTHY: Well, in relation to that, your Honour, the difference would be that the framework would provide a basis on which, under section 24, a whole series of matters could be negotiated or considered, such as the recognition that certain events were going to happen and as a result compensation was going to be paid, that arrangements would be made which could not be made otherwise for negotiations not to go on and for a whole series of other matters such as extinguishment of various rights and so on.
FRENCH CJ: We are talking about coverage of area agreements but it really comes back to, I think, what Justice Crennan was putting to you, that if you accept that the petroleum defendants are entitled to say, “We are not going to talk about this. It may be a matter which can be covered by an ILUA but we do not go down that path” it is that that leads me to ask the question, does the ILUA process make any difference to the basis upon which you assert that you are entitled to a declaration?
MR McCARTHY: Yes, it does and what the basis on which - the theoretical basis on which that is put as to the operations of the ILUA regime, I draw your Honours’ attention in our outline of submissions to paragraph 27. At 26 we had said, in relation to the defendants’ assertions about PERBAs, in the context, the dispute between the plaintiffs and the first and third defendants is not hypothetical. Contrary to what Logan J stated at paragraph [44], the resolution of the dispute is not dependent on it being determined that the plaintiffs hold native title.
This is because an ILUA can be concluded and have statutory effect irrespective of whether the native title party has obtained, or ever obtains, a determination that native title exists. We quote from the Jones Case:
It can be seen that under Pt 2 Div 3 of the NT Act, an indigenous land use agreement, whilst proceeding on the basis of an assumption as to the existence of the claimed native title rights and interests, is not intended to recognise such rights and interests . . . of an area of land over which there is a claim for determination of native title may be validated if it is a future act as defined in s233.
The aptness of this analysis to the present case is demonstrated by the fact that in asserting that the grant of petroleum lease would be a PERBA the first defendant is assuming the existence of the claimed native title rights and interests and that the grant of a petroleum lease emanating from the ATP would be a future act. This is so because, by definition, a PERBA is a species of future act. This is not to say that the first defendant recognises the existence of the claimed rights, but in a context of the ILUA negotiations, the parties make that assumption, otherwise there would be no point in negotiating an ILUA. Mansfield J’s analysis further supports the plaintiffs’ argument that they do not need to prove the existence of their native title in order to have the court resolve the present dispute because in the context of the present dispute, the parties to the negotiation assume it ‑ ‑ ‑
FRENCH CJ: You can go through a Subdivision P process on a similar basis, can you not?
MR McCARTHY: Yes. That is certainly so. But your Honours, there is, in relation to the Native Title Act and in relation to the ILUA process, your Honour the Chief Justice, the statement, or the intention within the Act that native title be – native title rights and interests and holders be protected and be enhanced, first of all by agreement, by negotiation and not by litigation.
KIEFEL J: Could I just have you clarify something? The interest that you are asserting in relation to the declaration here is not tied to the rights or interests you have in the Subdivision P context. You are not saying that your interest is in the right to negotiate. The interest that you are relying upon is the interest in relation to ‑ ‑ ‑
MR McCARTHY: The ILUA.
KIEFEL J: ‑ ‑ ‑ negotiating ILUA. That is what you are confining it to.
MR McCARTHY: That is correct, yes. As native title claimants, we have a strong interest in having the certainty and the inner framework of an agreed settlement, rather than to have to litigate at length in relation to this matter.
GUMMOW J: I think what it may perhaps come to, Mr McCarthy, is that your interest in the establishment of the position of the petroleum companies under the Queensland petroleum law, your interest in knowing what that situation is, is more than hypothetical because of what you say at paragraph 32 of your written submissions, and 32 coupled with 34.3. Is that a fair way of putting it?
MR McCARTHY: Yes, it would, your Honour. Thank you.
KIEFEL J: Would 34.3 suggest that the utility of the order is that the parties are informed as to the correct legal position?
MR McCARTHY: Yes, your Honour, and ‑ ‑ ‑
HAYNE J: Because the particular state of negotiations reached shows only one, no agreement has yet been made; two, there is an asserted unwillingness to conclude a term affecting the ATP; but, three, there is apparently no unwillingness to continue exploring the possibility of an ILUA.
MR McCARTHY: That is correct.
HAYNE J: The particular state at which we have got to in negotiations depends upon the moment at which you take a snapshot. That does not seem an especially productive starting point for determining where the declaration can go. The Act, if anywhere, is its place.
MR McCARTHY: It may be more than a snapshot, your Honour. It might be a DVD that has run for a period ‑ ‑ ‑
HAYNE J: Or it could be turned into a DVD of many episodes, Mr McCarthy, and it will be about as entertaining as most such negotiations, but we have got to a particular point at the moment.
MR McCARTHY: We have got to a particular point, your Honour, and the point, whether it is a snapshot or the DVD, is this, that there is a point of law difference between the parties in relation to the nature of the interests that the petroleum parties hold in relation to the claim land, and they are asking in those negotiations for something to the equivalent of what is put forward in clause 9.3, that there be consents to petroleum legislation.
Now, it is a matter of significance to the native title parties in the ILUA negotiations to know whether in actual fact the leases that may be granted to the petroleum parties are in fact PERBAs or whether in actual fact they are not. While there has been an assertion by the petroleum parties as to their position it certainly has not been asserted, to take the next snapshot, that if it was the case that it has been clarified that the leases would not be PERBAs – in other words, the ATP situation was resolved in the negative, that is, that the present arrangements would have to be revised, that they would not negotiate then.
Certainly it is the case and it can be said from the point of view – and this goes to the parity of interests – that there is also the question of the native title claimants and their position within the ILUA negotiations and that is this, that certainly if it is clarified that there are PERBAs, that is that the ATP is valid, then that has a bearing on the terms that – and the compensation and the other related interests in terms of the settlement of the agreement under the ILUA process, so that there is something there that is of interest and importance to both the parties.
HEYDON J: Mr McCarthy, can I see whether the following propositions capture one of your points? On page 173 we learn that on Sunday, 11 September in Charleville there were discussions and there had been discussions at other meetings. On 4 November 2005 Santos wrote a long and detailed, on the face of it, careful and responsible letter in answer, and on page 175 about lines 42 to 52 it sets out its position in law that their:
Authorities to Prospect pre‑date the Native Title Act –
and because of the –
“automatic” production licence grant provisions of the Petroleum Act 1923 (Qld) –
they had PERBAs. They did not say anything at all there about we are going to negotiate about whatever we want to negotiate about and we are entirely free not to deal with you at all and not to negotiate with you on any subject, and in particular we will not choose to enter into an ILUA which deals with that matter. That letter never said that.
MR McCARTHY: Never have.
HEYDON J: Is your position then that if this matter had been permitted to go to trial Santos might perhaps have called its managing director or someone capable of telling the court what the mind of the company was and that witness could have told the court that we will not choose to enter into an ILUA which deals with that matter so this litigation is a complete waste of time or at least no relief should be granted in relation to it. That movement towards that stage has been peremptorily interrupted by the Federal Court making orders under section 31A of the Federal Court of Australia Act and it should not have happened. Is that part of your argument?
MR McCARTHY: That is correct, your Honour, yes. Your Honours, if I could just conclude that point by drawing you back to the pleadings in this matter which are accepted as true in relation to, or can be proven, as set out by the ‑ ‑ ‑
GUMMOW J: Just going back to what Justice Heydon was putting to you, am I right in thinking that this “we are too proud to talk” theory of negotiation that is advanced by Mr Walker’s client does not come out of this correspondence? It comes out of counsel submissions?
MR McCARTHY: No, it comes out of counsel. It has certainly been hammered at us from the Bar table. It is certainly not Charleville. That is not how they talk up there.
GUMMOW J: There is no letter from the responsible Executive of these companies saying that. There is no letter in evidence from any responsible Executive that this corporation is saying this.
MR McCARTHY: That is correct, your Honour.
KIEFEL J: Has any counsel from the Bar table said that they are making the assertion upon instructions?
MR McCARTHY: I would have to have that checked, but my general recollection is that ‑ ‑ ‑
KIEFEL J: No doubt Mr Walker could clarify that for us in his submissions.
MR McCARTHY: I am sure he can.
BELL J: The topic is discussed in the transcript of the proceedings before the primary judge at application book 256 and 257, and there is no such indication that I see.
MR McCARTHY: I think that is correct, your Honour, thank you. But, your Honours, one of the things that was said on instructions is that our petroleum ‑ ‑ ‑
GUMMOW J: I am not sure it is good enough to say this sort of thing on instructions. If I was a judge hearing this, I would have something to say.
HAYNE J: There is a witness box for those things to be said.
GUMMOW J: I think so.
HEYDON J: If it were worth saying it could have been said in the letter of 4 November. Some explanation, it might be thought, would have to be given on oath for why it was not said in the letter, otherwise the inference is available that it has been thought up late in the day to try and beat off these irritating native title claimants.
MR McCARTHY: I think that is correct, your Honour. But, your Honours, what is to be assumed ‑ ‑ ‑
HAYNE J: But even if it were said, even assume that factual controversy in some way were to be resolved against your side of the argument, Mr McCarthy, even so, is it not necessary to take account of the fact that under 24CB of the Native Title Act – forgive me for intruding the Act – but under 24CB(e), the agreement may have an effect of extinguishing native title rights?
MR McCARTHY: It certainly may.
HAYNE J: The existence or non‑existence of a trump card in the form of a PERBA is relevant, possibly, to whether an ILUA, if it were to be made, could, should, might as a matter of commercial judgment include a term of a kind spoken of in 24CB(e) in respect of the land in which one side asserts and the other side denies the petroleum defendants hold this trump card in their hand. The way in which negotiations play out in the future is unknown.
MR McCARTHY: Yes, your Honour. But certainly those sections that your Honour draws my attention to, and I had hoped to draw the Court’s attention to later, is in actual fact the case. Your Honour Justice Hayne, that is not a theoretical possibility because part of the narrative for this matter is that which is set out at pages 18 and 19 in relation to – they are facts that were assumed in relation to the summary judgment procedure which included ongoing negotiations which adds more poignancy to the point that has been put to me over correspondence and lack of it by his Honour Justice Heydon and your Honour Justice Gummow on that, that there is no absence of such, or no presence of such material.
Your Honours, might I turn to the question of the jurisdiction in the matter issue and if I could take the Court to this, that it is the finding of the courts below that this ILUA controversy did not constitute a matter, a matter in the constitutional sense and for that reason the court was required to decline or decline jurisdiction. That is put in various ways in the judgment by the primary judge. Essential to that is the question of the hypothetical which, it being non-hypothetical, I think, has been fairly significantly dealt with in terms of the submissions and the exchange that we have had this morning in relation to those issues, but there is a question of what is the standard for this, what is a concrete situation, what rights are being affected in the attempt to administer the law.
Now, your Honours, in what has been a case over some time that has been fought with some ferocity, if there was a major case in the High Court that was against us, I think we would have been told. So I assume that that is not so and we are, in actual fact, at the point where the Court may apply and look again at some of the tests and descriptions that have been given in relation to that. I do not intend to have any large excursus into the matter. I would draw your Honours attention to what was said in Abebe v The Commonwealth and I want to make reference to McBain’s Case. I do not want to quote at length. I just want to draw the Court’s attention to that.
If I could take your Honours – your Honours, I do not want to read much but I would like to just give you these words in this matter about “matter”. I draw your Honours’ attention in the Abebe matter to the judgment of the then Chief Justice ‑ ‑ ‑
HEYDON J: 197 CLR 510 at where?
MR McCARTHY: Thank you. At 510 and I would draw your attention to 524, the paragraph at 25:
A “matter is therefore ordinarily concerned with “some immediate right, duty or liability to be established by the determination of the Court” . . . that ‘matter’ is wide enough to include any subject matter for determination in legal proceedings . . . it is clear that proceedings may involve a “matter” even when they are not determinative of the rights of the parties, provided the proceedings concern the determination of what their rights were if the law had been properly applied.
Then the reference to standards being applied. I take your Honours then to note paragraph 26 which has the reference to:
a “matter” is concerned with the rights, duties and liabilities of particular parties in concrete situations –
Then at the bottom of paragraph 27, about the need for:
such rights, duties and liabilities as will be enforceable in the federal or State court upon which is conferred or in which is invested authority to adjudicate.
Your Honours, I would draw particular attention to paragraph 32 and I do read the following in that where it says that:
The existence of a “matter”, therefore, cannot be separated from the existence of a remedy to enforce the substantive right, duty or liability. That does not mean that there can be no “matter” unless the existence of a right, duty or liability is established. It is sufficient that the moving party claims that he or she has a legal remedy in the court where the proceedings have been commenced to endorse the right, duty or liability in question. It does mean, however, that there must be a remedy enforceable in a court of justice, that it must be enforceable in the court in which the proceedings are commenced and that the person claiming ‑ ‑ ‑
GUMMOW J: I am not sure that I accept paragraph 32. I just do not think I accept paragraph 32. It ignores the whole development of the declaratory remedy.
MR McCARTHY: I beg your pardon?
GUMMOW J: It ignores the development of the declaratory remedy and its place in Chapter III.
MR McCARTHY: Well, your Honours, I wanted to draw to your Honours’ attention to that and to the fact that sections of Abebe, particularly the right that there be a remedy available, the court with a remedy, and is a part of what is a ‑ ‑ ‑
GUMMOW J: Paragraph 32, to my mind, is a perhaps too unsophisticated view of the nature of what goes on in litigation. It has a common law slant of plaintiffs and defendants recovery of judgments and damages and all that sort of thing.
CRENNAN J: I mean, there would be no problem getting declaratory relief if parties had a disagreement about the meaning of a clause in a contract and no problem, one would expect, about getting declaratory relief at the application of a third party possibly wanting to enforce a benefit under a contract. So declarations issue in those sorts of contexts.
MR McCARTHY: Yes, your Honour, and when one is ‑ ‑ ‑
HAYNE J: There is a real and lively controversy between these parties about whether declaration and injunction should go. There was no doubt there was a controversy between the parties. The question is, was it a case in which declaration was available?
MR McCARTHY: Well, your Honour, we are submitting that in a – our submission is that there is. Our submission is that this is a controversy, a dispute, in relation to a law concerning an important process under a very important piece of legislation which the court which has primary jurisdiction in the matter, which is the Federal Court, could make appropriate orders, particularly as those orders would quell the controversy between the parties about what was in dispute in the ILUA proceedings.
HEYDON J: Mr McCarthy, I would be helped if I could be directed to the provisions in Subdivision C in which the Parliament is actually trying to control the negotiation. I, in my untutored way, have collected a few provisions. One of them is section 24CF(1) which says that:
Persons wishing to make the agreement may request assistance from the NNTT or a recognised State/Territory body in negotiating the agreement.
So Parliament sees it as important that the State, the government, brings sinews of war to the negotiation to give assistance to enable them to proceed. Another matter is this, 24CD(7) says that:
If there are any representative Aboriginal/Torres Strait Islander bodies for any of the area and none of them is proposed to be a party to the agreement, a person in the native title group, before entering into the agreement:
(a)must inform at least one of the representative Aboriginal/Torres Strait Islander bodies of its intention to enter into the agreement; and
(b)may consult -
them so Parliament is showing a concern that persons who are not actually parties have input into the negotiation. Related to that is 24CG(3)(b)(ii) which says that the application for registration must include a statement that all of the representative Aboriginal/Torres Strait Islander bodies “have authorised the making of the agreement”.
A further related provision is 203BE(5)(b) which is the same subject matter, there can be no certification for registration of an indigenous land use agreement unless all of certain classes of people “have authorised the making of the agreement”. Finally, 24CL(3) says:
The second condition is that the Registrar considers that the requirements . . . relating to identifying native title holders and ensuring that they have authorised the making of the agreement) have been met.
All these provisions seem to deal with negotiation. They are all things that look back to a time before the agreement was actually made. Are there any other provisions of that or any other relevant kind that we should keep in mind in considering your arguments?
MR McCARTHY: If your Honour will allow me just a moment. As to the importance of the negotiations, your Honour, there is also section 24EBA which allows ‑ ‑ ‑
HEYDON J: Sorry?
MR McCARTHY: This is the section which allows a registration of the ILUA agreement to bind – EB, I am sorry.
HEYDON J: EB?
MR McCARTHY: EB.
HEYDON J: Right.
MR McCARTHY: So consultation and negotiation are replete in respect of this, and of course, all this can take place, your Honours, in a context where the principal parties are native title claimants and not native title holders and all of this is to provide a basis in which the disputes in respect of major issues, particularly a major issue of law, can be resolved.
HAYNE J: Account may also have to be taken of 24DJ – that is “D” Delta, “J” Julia – and objections - DJ(1) would require attention to whether the particular agreement as struck is fair and reasonable. Now, fairness and reasonableness may turn upon the nature of the rights that either side has or does not have in respect of the subject matter of the agreement.
MR McCARTHY: That is correct, your Honour.
FRENCH CJ: The object of these indigenous land use agreement provisions which came into the Act later was to address concerns, was it not, about lack of certainty in the conclusion of agreements that one might, for example, from the mining industry perspective, negotiate the native title claim group, but not be sure that you have got a sign-off which would bind all people within the group, and vice versa.
MR McCARTHY: Your Honour, that is ‑ ‑ ‑
FRENCH CJ: You see that reflected in 24EA, I think.
MR McCARTHY: Yes, your Honour. Your Honour, in relation to the pre‑1998 amendments, if I can just make a general statement, and I do not mean to get away from - the situation had emerged that it was very difficult to get any forms of agreement because it was uncertain, in terms of procedures, who were the native title holders and how you got their consent, to have the agreements brought around. That brought in the concept of indigenous land use agreements and authorisation and other processes, so that agreements could go forward.
Your Honour, prior to that, if there was going to be any objection on the part of any relevant indigenous, there was no way to resolve that dispute. Your Honours, could I just draw your attention, following what his Honour the Chief Justice has put to me as to the purpose of a legislation and the context in which you would be thinking about this, to – and they have been provided – the Native Title Amendment Bill 1997 explanatory memorandum and I draw your attentions to the overview, 6.2, and to paragraph 7.2 in that context. I want to draw the Court’s attention in 6.2, to the first sentence, and to the last two words, that in relation to what is being proposed, it is “over areas where native title may exist”. The word used is not “does”. It is “may exist”.
Might I draw your attentions now to 7.2, “Validity of future acts done under indigenous land use agreements” and to the statement there as to the proposal which is consonant with what his Honour the Chief Justice was putting just a moment ago:
Section 21 of the NTA currently provides for agreements. It does so, however, in very general terms. It does not accommodate the fact that, over most of mainland Australia, governments and others seeking to use land do not know if native title exists, and if it does, who holds it. It is difficult in such circumstances to have agreements which provide the necessary level of legal certainty. These provisions are designed to give security for agreements with native title holders -
This sentence I would particularly draw your Honours attention to –
whether there has been an approved determination of native title or not, provided certain requirements are met. Three kinds of ILUA can be made as set out below.
It is in that context that one is talking about native title claimants having a central role in the native title agreement process, and in having, not only an interest, but that of being of a sufficient nature that this would be, given its importance and the overall importance of negotiation in the settlement of indigenous matters in the Act, that they would be sufficient, not only for a judicial controversy but a matter for determination by the Federal Court when something of the nature of a legal issue of the type that we have here has emerged.
GUMMOW J: Are you going to take us on this question of authority to the Chief Justice’s judgment in the Federal Court in Australian Gas Light [2003] ATPR 41-962, paragraphs 38 through to 40 as to the nature and utility of the declaratory remedy as to future activity with reference, in particular, to Sterling Nicholas Duty Free and other authorities? It seems to me to provide an effective counterweight to that passage from Abebe which you were reluctantly forced to read to us.
MR McCARTHY: I thank your Honour for drawing myself and the Court’s attention to what is there.
GUMMOW J: In particular, paragraph 40.
MR McCARTHY: It is paragraph 40 that I have marked and I – yes, your Honour, and I would submit that the approach that is set out there by his Honour the Chief Justice is the approach for which we are submitting the Court would take and, your Honour ‑ ‑ ‑
CRENNAN J: I think there is also an observation, just to record it, in Re Wakim; Ex parte McNally (1999) 198 CLR 511 at 585, paragraph 140 where their Honours Justices Gummow and Hayne also make the point that identifying a judicial controversy can be “a matter of impression and of practical judgment”.
MR McCARTHY: Yes, your Honour. I would rely on that. I have to confess, your Honour, I had not been proposing to take the Court to that, but I am grateful for it and I would include that as a part of the legal context in which our submission that this is a controversy and that this would be a matter in which judgment would lie in terms of the applicants and against the approach that was taken in the Federal Court. Your Honours, in relation to again the matter of matter, could I just say this ‑ ‑ ‑
GUMMOW J: Is there anything in Fejo bearing on this?
MR McCARTHY: In Fejo?
GUMMOW J: Yes.
HEYDON J: 195 CLR 96.
MR McCARTHY: There is this, your Honour. Fejo is the permanent monument to what the grant of a fee simple will do to native title rights and interest in Australia.
GUMMOW J: Paragraph 33.
MR McCARTHY: Your Honour, I would just say this, that the principal submission of the plaintiffs in relation to the Lardil Case and the findings in Lardil is that the matter is heavily distinguishable as relating to procedural rights in certain context from ILUA negotiations and the status of parties and what they are trying to achieve there. It was in part raised – or the alternative argument that we have put in our submission is in relation to the question about the correctness of Lardil, which is not our principal – which we believe is not something that needs to be taken up because we believe it can be distinguished, but, your Honour, in that context we would say that the grant of an estate as fee simple would be one of the examples we would give as to what the meaning of the word “Acts” has in terms of it being the nature of the instrument itself rather than the reverse.
But your Honour, outside of that, I can only say that there was nothing particular in Fejo, except in the context of again, a remark being made, or recognition that you could have settlements of matters pertaining to native title interests, your Honour, without having the native title in actual fact settled or finally determined. Outside of that, your Honour, I am not sure that I can recall anything precisely in Fejo at this stage.
Your Honours, I had said over matter that – I made reference to McBain. I was making particular reference to the judgment by your Honour Justice Gummow and Justice Gaudron in that matter and what is called the “tripartite” identification, the controversy, which is at – sorry, your Honours, I will just give you the reference. I was not going to quote it through. I was just going to give you examples as to how I thought it could be used.
HAYNE J: 209 CLR 372 at 405 and 406.
MR McCARTHY: I am grateful to your Honour for that. I draw your Honours’ attention to 62, and to:
the identification of the subject matter for determination . . . the identification of the right, duty or liability . . . the identification of the controversy between the parties -
I think sufficient has been said this morning about the identification of the controversy between the parties and the identification of the right and interest and liabilities, I think, has been sufficiently covered too, and the identification of the subject matter for determination, I think, are also matters that we have fairly clearly dealt with.
In that context, your Honours, we submit that there is a matter that the finding in the courts below that there was no matter is incorrect. It is an error that goes to jurisdiction in the sense of mistakenly denying jurisdiction in the sense that those words are used, most recently by the Court in Kirk, and I do not intend to quote that, but the reference to the relevant paragraphs in Kirk 239 CLR 531 and in paragraph 72, in the section under “Jurisdictional error”, there is reference to it being stated as:
a general description of what is jurisdictional error by an inferior court, that an inferior court falls into jurisdictional error “if it mistakenly asserts or denies the existence of jurisdiction or if it misapprehends or disregards the nature or limits of its functions –
We would rely in this case on a mistaken denial of the existence of jurisdiction. Further, in the recapitulation from Craig’s Case, at 574 there is a point ‑ ‑ ‑
FRENCH CJ: Citation for Craig?
MR McCARTHY: I am citing 239 at 531, that is Kirk’s Case. I have been quoting from 573, paragraph 72 at the bottom of the page – this is in the CLR – a reference to:
an inferior court falls into jurisdictional error “if it mistakenly asserts or denies the existence of jurisdiction –
That is at the top of page 574. At about point 6 of the page there in the recapitulation of Craig’s Case there is a point (c) that says:
misconstruction of the relevant statute thereby misconceiving the nature of the function which the inferior court is performing or the extent of its powers in the circumstances of the particular case.
We would submit that that has come about in relation to both – with the Federal Court in respect of both the Native Title Act in relation to Subdivision C of Part 2, Division 3 and in relation to the jurisdiction of the court. We would also conclude, your Honours, by saying in relation to jurisdiction that the issues that were put before the Federal Court were in two parts. One is the federal claims and the second is the State claim. In other words, there is an issue in relation to accrued jurisdiction, and that had to be balanced as a whole.
In relation to that our submission would be that the test – and on our list of authorities there is a series of cases that are set there involving the question about accrued jurisdiction when there were issues about claims – we would say – issue about the validity and genuineness of claims – that this is a case in which every aspect of the federal claim is genuine, and in those circumstances what was said below as characterised by the submissions for the Attorney‑General that if the primary judge was meaning that this was a fabrication that is rejected, and these claims were not fabricated in any shape or form and as a result we would submit, but contrary to the Solicitor‑General, that if in actual fact the claims are regarded as genuine then they are not only genuine, they are arguable and proper, and that in those circumstances there is accrued jurisdiction in relation to the Federal Court and this matter could have been heard.
Your Honours, I turn now to the section 31A point which is in relation to the summary judgment situation where we are said to have no real prospects of success. This is the argument in relation to the nature of our claim, or the claims here, and the Lardil point. Our simple submission in relation to this is in two forms ‑ ‑ ‑
FRENCH CJ: Well, that just goes to the question of your injunctive relief, does it not?
MR McCARTHY: We were rejected overall.
FRENCH CJ: Yes, I know, on jurisdiction, but does this point go to anything really other than injunction?
MR McCARTHY: I did not – your Honour, I do not know if ourselves or either of the parties have understood the primary judge to have rejected us just in relation to injunctions. I think the rejection, the Lardil point, that is, was in toto, that if you had not established your native title rights you were entitled to nothing and that was the section 31A point.
Our submission is for all the reasons - and it has been touched on – if I could take your Honours to our reply in this matter. Your Honours, there is, at paragraph 17 through to 26, set out the differences as to why there is a different legal framework and set of facts that distinguishes Lardil and its concern with procedural rights under the Act from the situation that is being described in relation to the ILUA negotiations and to the relationship between the native title claimant and other parties under ILUA negotiations.
Our argument there is that Lardil does not apply in terms to this situation. It is a matter that is concerned with, as I have said, procedural rights and in relation to the nature of what our claims were, we summarise at paragraph 25 that contrary to the finding of the primary judge that our claim is not necessarily premised on the proposition that a grant of a petroleum lease is a future act. What we have done is acted in terms of the way in which, appropriately for the parties, ILUA negotiations are carried out.
In that context, where we have been faced with the dismissal that has occurred, we say that has happened in a context where a real contest as to the application of Lardil, a real contest as to the meaning of other sections of the Act were before the Court and that in terms of what your Honours have recently decided in the Spencer Case that your Honours would find that this was not an appropriate matter for a finding of no reasonable prospect of success.
Your Honours, I do not intend to quote Spencer, but if I could just give the references in relation to that. Basically we say there was a real question to be tried of fact in this matter and that was put strenuously to his Honour below and it was rejected and his Honour was in error in doing so. His error was of such a nature that it is beyond – that it goes to jurisdiction. If I can give the reference from the ALR, I wanted to ‑ ‑ ‑
GUMMOW J: It is 84 ALJR 612.
MR McCARTHY: Thank you. It is now 269 ALR also, your Honour, and I was quoting paragraph [24] from the judgment of his Honour the Chief Justice and yourself, Justice Gummow, your Honour, and I – [24] and [25] and in relation to the remaining Justices in the Court I was quoting – I draw attention to paragraph [40] and to paragraphs [59] and [60].
BELL J: Mr McCarthy, in your reply submissions, both on the issue of jurisdiction and on the question of whether there is a real issue to be tried, you place considerable significance on the implementation agreement and the unregistered ILUA. It is not clear to me how that strengthens your position in either respect, save as demonstrating these negotiations have been ongoing for some time, but is there some particular significance to the implementation agreement and the ILUA beyond establishing that?
MR McCARTHY: Yes, your Honour. They were aimed at comprehensiveness, that they included references to petroleum legislation and that they had been – there had been an agreement to disagree in 2001 and that is the context in which the issue – the correspondence, as discussed with her Honour Justice Kiefel that came out, that that is a part of the context to show that it was concrete and significant and that it was not something that was other than having an important bearing on how the parties would react. In other words, if this is clarified one way or another, the parties would be in a better position, including the native title claimants, as to how to settle the rest of the agreement in relation to clause 9 this time round, your Honour. That is the significance that we were trying to convey.
BELL J: That is the meaning of the last sentence in paragraph 11?
MR McCARTHY: Yes, your Honour. Your Honours, the other matter that we would just mention in terms of no reasonable prospects of success in terms of accrued jurisdiction that in relation to the way in which the primary judge has approached the matter of summary judgment in this matter, this was a summary judgment application in which it had already been assumed and should have been assumed by his Honour in weighing up prospects of success in the matter, that in actual fact he was asked to assume for purposes of what he was finding that in relation to the ATT that the plaintiffs would be successful or the whole of the time that the matter was before the primary judge, except when apparently, subsequently, it was the case that the assumption on which the matter was put before him was that the prospects of success of the plaintiffs was absolute, that they would succeed in relation to that particular issue.
Your Honours, the only other matters that I would wish to put before the Court involves drawing attention to our submissions in relation to the utility of further orders, though I think this has been discussed further as to the nature of Queensland legislation and the way in which, if the ATP is no longer operative, there would be other ways in which the Queensland Government could bring about leases in that particular matter.
KIEFEL J: The point of that being that you still have a future act to discuss in the context of ILUAs.
MR McCARTHY: That is correct, your Honour.
KIEFEL J: So you have an interest in ‑ ‑ ‑
MR McCARTHY: Yes, your Honour. Your Honours, I just conclude my submission by saying this, that they are our submissions, they are in the context of native title claimants and others concerned with native title interests, where the thrust of the Act is in terms of negotiation, taking it as a whole, and that the way in which an approach to any of the clauses the Act should be would be in terms of furthering negotiation, furthering settlement, of furthering the objects in section 3 and other sections of the Act, so that it is not the case that the courts stand by, or the courts ignore, or the courts take an approach in relation to issues that rise in a special statutory process such as the ILUA negotiations when the parties, or particularly the native title claimants, make proper submissions as to ways in which these can be put forward. This was designed by them to try and assist their native title process and the Act and the way it would be interpreted, in our respectful submission, should support that. Those are our submissions, your Honours.
HEYDON J: Mr McCarthy, can I just ask one question? On page 2, which contains the orders you seek, order 1 is an order for certiorari, and order 2 is an order for a writ of mandamus. If order 1 were granted, would order 2 be necessary? Is an order in the nature of mandamus appropriate to be directed to a superior court of record? If order 1 were granted, then you would be in the position of having filed initiating process in the Federal Court of Australia with a right for it to be heard in the ordinary way.
MR McCARTHY: It certainly could be the result of the matter, yes, your Honour.
FRENCH CJ: Thank you, Mr McCarthy. Yes, Mr Walker.
MR WALKER: Your Honours, there are, in our submission, matters really not contestable in the history of the dealings between the parties which cast a light on both the jurisdictional and other issues presented in this Court, which have not been ventilated in my friend’s address, or indeed in their written submissions.
Furthermore, a matter has been raised in their written submissions, namely, paragraph 10 of their written reply, concerning the possibility in the future of a grant of a relevant petroleum lease or licence to produce under the 2004 State Act which has not until this Court, that is, the written reply by way of submission in this Court, been any issue between the parties. It is convenient if I first start with that most recent matter and then go back to pick up the narrative which, in our submission, answers, in particular, the matters that Justice Heydon raised with my learned friend, and also Justice Gummow.
There is no pleading by the plaintiffs. There is no evidence in the material before this Court to show that the position has ever been taken by my clients that were the ATP, the authority to prospect under the 1923 State Act, not available to found a grant of a petroleum lease under the 1923 Act, there would nonetheless be some kind of protected status for a completely alternative right in the nature of permission to produce issued under the 2004 Act. There is not a syllable of that in any of the historical dealings between the parties. There is not a shred of support for it in the Native Title Act and there could not otherwise be any suggestion of a position taken by my clients asserting that there would not be an obvious occasion for commercial dealings resulting in an ILUA if the parties could agree.
That will no doubt include, because an ILUA would be the result of successful negotiations in what might be called an arbitrage exposition, where the parties reach either similar or dissimilar evaluations of their respective positions. What would it be worth, for example, to be able to produce from the area in question? What is sought under an ILUA in order to be able to enjoy that, given that a future act, which is not a PERBA, would relevantly be, of course, invalid to the extent of any inconsistency, including partial inconsistency with native title rights and interests. All of that, of course, not only lies in the future, which is no objection of itself, but depends upon matters none of which have been rendered concrete or could be rendered concrete before this Court or before the courts below.
Justice Logan knew nothing of the notion that these parties may come to negotiate if my clients appreciated that the only way they could get permission to produce oil and gas would be under the 2004 Act. Now, with great respect, the comments made by Justices Heydon and Gummow about the difference between sworn evidence – I think Justice Hayne made a similar comment – and statements from the Bar table are, so far as we are concerned, strictures completely accepted. I do not to any degree or in any way suggest that positions taken – as they always are on instructions only, but that is not to the point – from the Bar table which should have been and could have been the subject of evidence, provide any substitute and I will not be doing that at all.
I can say, and it is proper for me to say, that there has never been any suggestion of a 2004 State Act issue and on the face of the statute and in accordance with instructions, I can say as a matter of argument as to the state of affairs that would follow under the Native Title Act that if – I stress, if – there were any inconsistency including partial inconsistency between the issue of such a permission under the 2004 Act and the rights and interests comprising the native title, if there be native title, then of course there would need to be one or other of what I will call the validating methods.
In this case – though it is not the exclusive route – in this case of course an ILUA would present itself to anybody with their statutory common law and fiduciary duties owed to their corporation, as my client’s officers owe, of course that opportunity would be presented, and we do not stand here to say, to adopt a phrase earlier used, we would be too proud to talk. Of course we are not, that is not to the point.
HEYDON J: Do you withdraw the second sentence of paragraph 17 of your written submissions?
MR WALKER: I think it is best if I say yes. The only alternative answer would be to say that an ILUA which deals with that matter at the price or anything like the price shown in the correspondence in question, that is what were not prepared – that is a position which we maintain, but otherwise I accept entirely that the second sentence of 17 does have the vice of suggesting, as it were, an inflexibility come what may, and that is not correct and I apologise.
KIEFEL J: If the plaintiffs are held – the issue that they raised is maintained only with respect to the Petroleum Act 1923, do you say that a declaration would lack utility?
MR WALKER: Yes, I do. Now, that is for another reason which I will seek to develop. You will note it in paragraph 22 of our written submission. I will come to that separately. If I could make good what we submit is necessary to appreciate all of the arguments in this case and now go back in history? We have just pointed out that if and when a grant under the 2004 Act applies, of course as a matter of submission we say, there would be no question of it being a PERBA. That is absurd, and that is the only point of substance which one sees in the course of negotiations, to use the pleading’s expression. Can I start in relation to the course of negotiations, back before the letter in question, back with some of the dealings that Justice Bell asked my friend about. In the book ‑ ‑ ‑
HAYNE J: With a view to demonstrating what end point?
MR WALKER: With a view to demonstrating that there is, in particular, nothing in the point that either standing or interest is given by the parties seeking what my friend repeatedly called a comprehensive settlement. The record belies that. Now, with respect, my friend also fairly put that in one of his closing submissions in‑chief, but may I draw to attention what I think my friend was referring to. In the book at page 138, this is the so‑called former ILUA which had expired and replacement of which was in question between the parties.
At page 138, in relation to the so‑called project rights that my learned friend showed you covered by section 9 of the agreement, clause 9.4, in particular, recorded the agreement to disagree, recorded no compromise on that question. Now, of course, it also perforce records that, in a sense, a very commercial sense, those matters had been the subject of negotiations but that, in effect, at that stage of negotiations – I stress at that stage of negotiations – the joint venture parties were not prepared to pay for them, to pay for the certainty which the recitals talked about in relation to what they thought would be PERBAs and the native title parties were not, in any way, accepting that that was a correct position.
In that regard, I need to take your Honours as well, to page 140, in the former ILUA, clause 12.2. Indeed, although much of the language of this ILUA could fairly be said but for 12.2 to be premised on the existence of native title, the fact is the parties agreed that all of these terms were, if I may put it this way, without prejudice to the question whether native title existed. That is not to say that we were in a contentious or adversarial position there. It was that there was no admission.
At page 124 in the same document one saw there that this was a stage in dealings and that expressly the parties had agreed to negotiate something further, see 2.4(a). In that light, of course, what my learned friend drew to attention in the recitals at page 114, that is, the parties having reached a comprehensive settlement of outstanding matters between the parties, has got to enjoy the fate of many a recital, far too general to be accurate. Similarly, the next sentence, clearly not correct. The certainty that my parties may or may not have felt in relation to its dealings with native title so far as a grant of petroleum leases under the 1923 State Act was a certainty they had reached not by reason of compromise or assurance under this agreement.
Against that background one then had the correspondence to which reference has been made that starts at page 173, 4 November 2005. The significance for the case is, of course, that that is the correspondence which you will see particularised at page 19 about line 20 under the important paragraph 5 to which I will be coming. At page 173 there is reference to meetings which plainly were part of negotiations. Furthermore, the opening sentence on page 173 makes clear that this letter is to summarise a proposal for an ILUA which my client wishes to reach, whether it be called an offer or counter‑offer does not matter. This is a step by my clients in negotiations. Everything, it may be said, in this letter is a subject matter of negotiations.
At page 175 at about line 28 there is a reference to dealings between the parties over what is called the term of the current ILUA. That is the former one with which I started. My clients recorded that it had been their position that during that ILUA that was not appropriate, that is, to ask for greater benefits. Now, that is clearly only a commercial view. It has no legal status of any kind.
Then, as it were, consistent with 2.4 of the former ILUA, my parties say, well, we are now negotiating a superseding ILUA, superseding referring to its relation to the former one, and therefore it is now appropriate to address these requests. That refers generically to some requests made previously on behalf of the traditional owners or, I should say, the claimants for land native title.
The first item is significantly called “Gift of the Santos Pastoral Leases”. This is property of ours. Dropping down to line 42, in this negotiating letter my clients take the position that they are worth more than $20million. So parties negotiating, one says to the other, “Well, you’re asking for something worth $20 million.” It is not unusual, although of course it is not compulsory, for there to be something in the nature of explanation put by way of explaining a position why that request will not be met and that is what is happening under item 1, the gift of these leases. The word “gift”, of course, may be tendentious, that is not to the point.
They have requested that there be a transfer obviously for no purchase price. Santos has considered the request and advises that it will not gift these pastoral leases. Now, it is that, with respect, that produced the infelicitous or, worse, second sentence of paragraph 17 of our written submissions to which I have made earlier reference in response to Justice Heydon, but what we were refusing is, and was under the heading of, may we have the pastoral leases? Answer: no, they are worth $20 million or thereabouts, or what they were then.
Then there is a reference to previous steps in negotiation where a position had been put which truly is a position involving, though not entirely dependent on, matters of law. If there is a point of law difference between the parties it appears to be and to be only a difference about the effect of events in light of the operation of the Queensland 1923 Act. I will come back to that and the significance of it, particularly in providing a delayed or deferred answer to Justice Kiefel’s question.
What we there explained, again in summary, was that there were what we dubbed automatic production licence grant provisions, and that is not an unfair paraphrase, given section 40 which uses the notion of entitlement. A view is put, explicitly described as “our view” – see line 49 – that any such petroleum leases would be PERBAs, if I can use the jargon, and then follows perhaps an unhappy expression and certainly one picked up by the plaintiff in their pleading in the Federal Court, “and, as such, are not subject to the right to negotiate provisions of the NTA.” On reflection, of course, it is a perfectly accurate proposition in the sense that being PERBAs there would not be any invalidation and, in particular, a failure to negotiate and reach an agreement or a failure to negotiate and let the statutory process sans ILUA work itself out, would not invalidate the rights.
So, although, in retrospect, bearing in mind the pleading against us, that might have been expressed in a more ponderous fashion as a summary of the position that was entirely correct. We do not have to negotiate with you, that is, have to in the commercial sense, because these are not rights which are subject to the invalidation, which is the sanction designed by the Commonwealth Parliament in the Native Title Act to encourage either an ILUA or the statutory process which follows upon the right to negotiate being exercised. There is then an assimilation of the position that is familiar throughout the country, namely, to what they call other titles granted prior to the Native Title Act.
Now, that was a view put about the operation in law under the Native Title Act and it was, as my friends have put it, with respect, appropriate in their written submissions, all on an assumption that there was native title. For the reasons my learned friend put, that is a sensible assumption to be making when discussing the possibility of an ILUA or its contents because an ILUA may be made before there has been a determination of native title, the essence of native title being, of course, that it exists regardless whether there is a determination or not.
GUMMOW J: Mr Walker, can you just go back to page 175?
MR WALKER: Yes.
GUMMOW J: Line 42, paragraph (a) there. What is the connection in terms of reasoning between the first and second sentences? The first sentence is talking about the estimated value of the pastoral leases, is it not?
MR WALKER: The connection is that the threat ‑ ‑ ‑
GUMMOW J: And the second sentence is talking about authorities to prospect.
MR WALKER: Quite so.
GUMMOW J: There is no valuation placed on them.
MR WALKER: No. Well, I talked about arbitrage earlier. An ILUA providing what I will call all necessary approvals and consents has value, distinct value, without any binding or authoritative statement, let alone from a court, of the risks to the oil and gas title, not least because uncertainty has its own depreciating effect in relevant markets, not only for securities, also for finance. So there is no question but that there can be, according to the perceptions and boldness of commercial players, value ascribed, attributed in negotiations and perfectly properly paid for out of company funds for the possibility that there may be a blot on title.
KIEFEL J: But what is being discussed here is the possibility of a consent to the issue of the lease as part of the ILUA so as to protect it.
MR WALKER: So as to remove a possible blot on title. It would be a very serious blot on title, bearing in mind what might be predicted about most worthwhile native title rights and interests on the one hand and all worthwhile petroleum leases on the other hand. It would be pretty plausible that there would be some clash at some point to some extent that would be commercially considerable. It might even be fatal to the commercial proposition. So if the possibility of affectation of a 1923 Act petroleum lease being invalidated pro tanto or, effectively, completely by the existence of native title in the absence of, for example, an ILUA giving consent, if that presented as a sufficient prospect to those guiding my client’s commercial enterprise, then they would pay for it, presumably, but only a price which was reasonable.
So the connection between the reference to more than $20 million and to the state of affairs concerning a 1923 Act petroleum lease, if obtained, is pointing out, and very clearly pointing out, that such doubt as those on the other side of the negotiations may seek to raise about that oil and gas title in the future, does not come anywhere near $20 million. Indeed, in this letter, it is not suggested it comes anywhere near justifying any payment. Now, that is not to say that if a completely different and, I stress, hypothetical situation were to obtain, that we would not consider an ILUA incorporating such a term. That is purely hypothetical and that is part of our argument about how hypothetical the issues raised by the plaintiffs in this case are.
CRENNAN J: So the connection is a quid pro quo connection?
MR WALKER: Yes. Now, whether we are right in law or not is another matter to which I will come, but we were saying our view in law is that this oil and gas title, threat to which is a bargaining counter for you, the other side, threat to which is a bargaining counter, we say it is not threatened by anything. We have assessed the threat as effectively nil. In any event, it is the quid pro quo, that is, your consent in relation to it as a quid pro quo for us giving you something worth more than $20 million, and that obviously is being rejected. Now, there are four reasons given for the decision ‑ ‑ ‑
HEYDON J: Can I just interrupt. You said “if obtained”, if the 1923 Act lease ‑ ‑ ‑
MR WALKER: You have to apply, yes.
HEYDON J: Yes, but if obtained, there is not much of an if to it, is there?
MR WALKER: No, quite so, that is why ‑ ‑ ‑
HEYDON J: If you are a qualified person and you declare something and you lodge a piece of paper, the Minister must grant it.
MR WALKER: Yes, you are entitled is the word. That is why the word “automatic” is colloquial but fair. I am not trying to suggest there is any substance added to the hypothetical nature by the fact that it has not been obtained. We need to know the lease either as it is the subject matter of an application, which for the reasons I have just given to Justice Heydon will be granted, or you need to know it, after it has been granted, in order to know where it is, you would need to know where it is in order to make a finding about inconsistency with native title rights and interests. That is a different issue. That has nothing to do with uncertainty about getting it. That has to do with needing to know where it is and what it affects in relation to the land in question.
What we were saying in (a) is your request in negotiations is for something worth more than $20 million. We understand that that would be given in return for consents with respect to something that we assess we do not need your consent for because it is a PERBA. There is then a reference in item (b) to something which concerns pipeline construction for which consents are necessary. There is a position taken concerning what I will call its legal characterisation relevant to the negotiations, and the subject matter of our evidence in this Court, the affidavit of Mr Scott of 18 November 2010 which I seek to read, contains the story as it thereafter continued. There were negotiations which produced a pipeline consent agreement. That has got nothing to do with a petroleum lease or production licence, but the point is this is a negotiating letter and things did go further and there was an agreement made on 4 October 2006.
HEYDON J: Was Justice Logan told about that agreement?
MR WALKER: No, he was not.
HEYDON J: Why should we pay regard to it?
MR WALKER: This is not an appeal, this is ‑ ‑ ‑
HEYDON J: No, but if something existed which was relevant and Justice Logan was not told about it, why should we consider it? It is not a question of a barrier. It is a question of ‑ ‑ ‑
MR WALKER: Your Honour, perhaps my heart is not ‑ ‑ ‑
HEYDON J: If it was a good discretionary or perhaps more than discretionary reason for supporting the orders which Justice Logan eventually made, is it not all a matter for Justice Logan?
MR WALKER: Your Honour, the only possible answer to that is yes, of course. The question really is whether, given the way things have fallen out, namely, we are in this Court with relief discretionary in nature being sought, whether it is too late. We submit it is not too late. I entirely accept that, nonetheless, this Court can, as it were, hold my clients to the way in which they conducted the case below so long as one does not introduce a false analogy with an appeal, which it is not.
CRENNAN J: Is the suggestion being made that the negotiations which were under consideration before Mr Justice Logan are now completed?
MR WALKER: No. I do not want from the Bar table, as it were, to make offers to the other side. The state of the pleadings is that negotiations are in course, I think. What this affidavit shows is that, partly at least, those negotiations produced – and a long time ago now, it is now expired – produced a pipeline consent. In our submission, it really only highlights the fact that whether you use the photographic metaphor or not, I mean, snapshots really are, in our submission, an inappropriate way to assert that there is a non‑hypothetical matter dividing parties which a court may usefully and can properly determine.
What we know is that there has been, notwithstanding that the pipeline construction matter was put to one side in item 1(b) at the foot of 175 back in November 2005, there was in the next year, by 4 October 2006, a consent agreement between the parties where that was a subject of a bargain. Things do move on in negotiations. Now, as a complete hypothetical – and I stress, as a hypothetical – in order to illustrate the hypothetical nature of the issues raised concerning matters that fall out in the course of negotiations, what if, one can inquire, instead of wanting more than $20 million of pastoral leases, there was simply the cost of constructing a medical centre and a school instead? Who knows what would be the response? I cannot say what the response would be if that was all that was sought for a consent to something that we say did not need consent. It may be that it would be with alacrity accepted. We have no idea.
HAYNE J: But the bottom line of this proposition seems to be that if any agreement is to be concluded between these parties, it must be made without the parties being bound by litigation to certain determination of whether your client has, as it asserts, a trump card, that is, a card which trumps the title claimed by the present plaintiffs.
MR WALKER: Yes. Well, when I say yes, I am not agreeing, I am sorry. No, the “must” in your Honour’s proposition is one that we would not embrace.
HAYNE J: No, the “must” is important to the proposition, Mr Walker, because the proposition you are advancing is that any approach to the court is to raise an hypothetical question and it is hypothetical because the negotiation is not concluded. The “must” follows from the observation that so long as negotiations continue, the negotiations must go on in the state of uncertainty because the parties cannot – or one party cannot go to court in the intervening time.
MR WALKER: I will not embrace that, your Honour. The “must” does not describe our position at all. What we defend is the position reached by Justice Logan against which leave to appeal was refused by the Full Court because the circumstances of this case show this is hypothetical in the sense that the written submissions seek to demonstrate and the reasons of Justice Logan demonstrate. We do not commit ourselves to and we certainly do not need anything of a high level of abstraction that says negotiations as a class, incomplete as a subclass, expel the possibility of declaratory relief by a court. We certainly do not commit ourselves to that abstract proposition; do not need it either.
HAYNE J: I do not know what the middle ground is that you are so assiduously preserving, Mr Walker. I cannot identify it.
MR WALKER: It is the particular and concrete case that I am seeking to preserve, your Honour, just our case, because, as with great respect, the AGL decision by the Chief Justice, drawn to attention by Justice Gummow in a question to my friend, demonstrates it is a matter of judgment, evaluative assessment, in the circumstances of a particular case as to whether the intervention sought from a court is an appropriate one in light of, in that case, the limits of the declaratory jurisdiction in terms of both hypothetical nature which might inform the constitutional question of a matter and also the discretionary matter of utility.
These are matters which may not have bright lines dividing eligible from ineligible cases – all the more reason, in our submission, to see it as a matter which falls out according to what arises from the facts before the court. In this case, the facts continue on page 176 of the same negotiating letter where my client’s so‑ called “strong view” – see line 21 – is again put forward in what it calls its proposal ‑ ‑ ‑
GUMMOW J: Can I just interrupt you for a minute, Mr Walker. In answering Justice Hayne, were you giving sufficient weight to the provision in 2.4(a) on page 124 - “The parties shall negotiate the terms of a new ‑ ‑ ‑
MR WALKER: I hope so, your Honour, yes. These parties have never, so far as I am aware, and certainly so far as the record shows, they have never debated among themselves the nature of that provision. They have, as far as I understand from the record, and as the letter at 175 shows so far as it goes, they have observed it. That is all I can say because there is not a bundle of negotiating correspondents, nor is there proof of much negotiation.
HEYDON J: That is perfectly correct, no doubt, but in those circumstances, does it not support the standing of the plaintiffs to come to the Federal Court to say “We have a duty to negotiate. They have a duty to negotiate. They say one thing in point of law, we say another.” We cannot negotiate unless we sort this point of law out. It is a future question, as discussed by Chief Justice Barwick in the passage that Chief Justice French referred to in the ATPR Case.
MR WALKER: Yes.
HEYDON J: Is it not a strong argument in favour of their position on standing and matter and hypothetical issue, all of which are highly closely interconnected questions?
MR WALKER: I am bound to say on the question of – if the question of what may be negotiated otherwise is an apt subject for the court’s exercise of power, and I will come back to that, but if that be so, then I am bound to say, yes, to Justice Heydon and that is because the points which otherwise inform a standing challenge which have to do with what I will call the State Act issue, which involve surely showing that you are more than a claimant for native title but showing, if it were an interlocutory injunction being sought, enough for serious question, or if it is a perpetual injunction, which it seems to be, final injunction being sought, showing that you have got the title.
HEYDON J: But the statute says all you have to be as a native title claimant.
MR WALKER: That is what I am saying.
HEYDON J: A registered native title claimant is what they are.
MR WALKER: That is why I say if the issue be what may be negotiated under an ILUA and that is apt for judicial determination, then, with great respect, because you do not need a determination of native title to conclude an ILUA, then, with respect, the particular and specific nature of an ILUA under the Native Title Act would be a very solid foundation for people to have both interest and, therefore, standing. Yes, I accept that. Now, that has never been put, in our submission, but that does not mean it should not be considered. I am not saying it is out of court.
GUMMOW J: Now, in the light of all of that, Mr Walker, what are the perimeters of this middle ground?
MR WALKER: It is that there has never been any – there is no joinder of issue between these parties as to what may be the subject of negotiations.
KIEFEL J: Could I put it in a different context though. In relation to the question raised by the plaintiffs about the grant of a petroleum lease under the Queensland legislation which is reflected in their first declaration, in relation to that declaration you would seek to oppose it if it was going forward?
MR WALKER: Yes.
KIEFEL J: So there is no question about that?
MR WALKER: None at all.
KIEFEL J: So does that not put the question of whether or not there is a PERBA and whether or not there is a future act which might be relevant to an ILUA in the context of discretion and utility?
MR WALKER: No, it does not. In fact, I will deal with it now in this way. First of all, in terms of the way issue was joined in the Federal Court, as you will graphically see from the amendment of the application – if I could show you, in particular, page 14 of the book, former prayer 3 and former prayer 4 and, it need hardly be served, former prayer 5 – relief which would plainly have required, in our submission, a showing of sufficient interest to seek a declaration about our oil and gas title and, furthermore, an injunction preventing us from acting under our purported title – see 5 – would have been imposed upon the plaintiffs.
But they made it crystal clear to Justice Logan that they were not seeking to show to any degree or in any way – so this is not an interlocutory injunction being sought – they did not seek to show in any way their native title, if there was any, or what its content was, what the rights and interests were. They rested content, took the forensic risk of proving that they were registered claimants. That raises matters where I will be making reference to the reasoning of the Full Court in Lardil, but I will come back to that later.
When one, with respect, puts oneself in the position of Justice Logan, what are the issues before the court, how do I evaluate the real or concrete nature of the controversy between the parties, having ventured the contention that you see lies behind former prayers 3, 4 and 5 on page 14, the plaintiffs took them out, not least, of course, because the authority to prospect covers more than just us and there would be all sorts of people who would no doubt be interested in questions of invalidity, for obvious reasons. Against that background, one then notes, however ‑ ‑ ‑
HAYNE J: Perhaps at 2.15 you might give me the middle ground, Mr Walker. I do not think you have yet identified the middle ground and you might at 2.15.
KIEFEL J: I am probably responsible for interrupting you, Mr Walker.
HAYNE J: It is not a question of that, but at some point.
MR WALKER: Yes, your Honour, I entirely accept that. I will accept both propositions, (a) I have not given it, (b) I must. I wonder if, nonetheless, I may continue answering Justice Kiefel.
HAYNE J: Sure.
MR WALKER: Then one comes in the pleading where, notwithstanding those prayers for relief are withdrawn, one has the sequence to which my learned friend adverted starting at page 19, going over to the foot of page 20 in paragraphs 7 to 11 which plead, I think query, whether any facts are pleaded except insofar as we are talking about clerical acts, a legal matter is pleaded concerning what the 1923 Act permits or does not. So that would seem that the pleading which kept those contentions in effect was raising the matter of whether the ATP existed so as to provide a foundation for a future 1923 Act petroleum lease, and one goes back then to prayer 1 at page 13 which did remain in play. It is, and none the worse we accept for that, talking about something in the future, the grant of a petroleum lease under section 40 of the 1923 Act. There is nothing about the 2004 Act. It is said that that would not be a pre‑existing rights based Act.
Now, with respect, there is a confusion of concept when one appreciates that at no stage – and as recorded by Justice Logan – at no stage has it ever been said on behalf on the plaintiffs that there is any reason why it would not be a PERBA, except for the fact that it would not be at all. All they have ever said is that the ATP does not exist, therefore you cannot get a 1923 Act petroleum lease, and everyone has always furiously agreed – see the exchange of written submissions – that if you do not have a valid 1923 Act petroleum lease, then it plainly cannot be a PERBA. Indeed, it cannot be a future act. In order to be a future act, if I can put it this way, it needs to be valid in order for you then to consider whether it is invalid pro tanto.
KIEFEL J: I know that Justice Hayne has given you things to do over the luncheon adjournment. Could I just ask you to turn your mind to what Justice Logan said at paragraphs 28, 30 and 31, dealing with prospects of success? His Honour appears there to have identified as critical the question of whether or not there is a future act left, after the Queensland lease question, and his Honour seems to approach it on the basis of regardless of Lardil. If there is no future act, there is no prospect of success.
MR WALKER: We embrace that.
KIEFEL J: But the question is, when his Honour says there is no reasonable prospect of success, and given that he has put Lardil out of the picture in that regard, is his Honour saying no more than there is no utility, to bring you back to ‑ ‑ ‑
MR WALKER: He uses that expression later in a way that may well make that an appropriate way of characterising what he is saying there, but can I put it this way. If there is no authority to prospect, there cannot be a 1923 Act grant of petroleum lease and anything that purports to be such a thing will not be (a) a future act, because to be a future act it has to be valid, and (b) will not in particular be that subset of future acts which is a PERBA. If that is true, then of course any right to produce will not be a PERBA.
That is what I started by saying. This furphy of the 2004 Act raises something about which the parties have never on the face of the record or here today been in controversy. If it is not a PERBA, it is not a PERBA, and no doubt people will have a totally different view of including such matters in an ILUA or participating in the negotiation for which there is a right if it is not a PERBA. The ground that we said in our letter of negotiation, why we put the proposal we put was we think it is a PERBA, it will be a PERBA.
Now, if that is falsified, then it will not be a PERBA and away goes that ground. So that the only ground – and it is illogical at its heart in the plaintiffs’ case – the only ground they put for saying it would not be a PERBA, you should negotiate with us for consent to it, is that the ATP is invalid. Now, if the ATP is invalid, it is not a PERBA, and critically, and contrary to the written submissions by the plaintiffs, critically no ILUA in the most ample terms purchased at whatever price could do anything to make it a PERBA. Furthermore, could do anything to rehabilitate the invalidity at State law of a petroleum lease granted on the foundation of the non-existent ATP.
That is the only matter on the pleadings, the facts which are particularised in the pleadings before the Court. There was never a controversy about what would happen if the 2004 Act came into play. It was only if we were relying on the 1923 Act, basing ourselves on the ATP, we saying we thereby get a PERBA. The other side says but you cannot get a lease at all because the ATP does not exist, to which our answer before Justice Logan in the Full Court and to here remains, well, in that case, an ILUA cannot touch that either.
CRENNAN J: If it is not a PERBA, it follows, does it, that it is vulnerable to 24OA?
MR WALKER: No, it would not be anything. Their argument is that, and see their pleading, I mean, there would be no petroleum lease. That is the point. Their trump was, your ATP is invalid. That is what they thought their trump was and we disagree with them on that. If they are right about it, then they have nothing to sell us to be manifested in an ILUA because they cannot make that which is the defect of an invalid ATP good by any amount of agreement or for any price.
KIEFEL J: So there is absolutely no point to the declaration, though?
MR WALKER: There is no point in the declaration because ‑ ‑ ‑
CRENNAN J: There is no valid grant.
MR WALKER: If there is no valid grant, their consent in an ILUA does not make it a valid grant and does not avoid any invalidating effect. Why? Because there is nothing to invalidate. That is why I said earlier, advisedly, that looking at the language of the Native Title Act upon which, with respect, we defer to and adopt the exposition by learned counsel for Queensland, it can truly be said that in order to be invalidated by native title inconsistency first a future act has to be itself a valid Act.
FRENCH CJ: I suppose in the context of an ILUA – I do not know whether this makes any difference to your submission – one could be negotiating about something which is of uncertain provenance under State law but if it did exist would be a future act and it is a kind of risk‑management exercise from the point of view of the petroleum company.
MR WALKER: One could imagine, in particular, with respect to what I will call factual allegations that might invalidate, that a party may sell their willingness or their preparedness to push those contentions. That is not this case.
HAYNE J: The propositions you have just been advancing depend upon an equation, an illegitimate equation, of one possible subject matter of an ILUA with the whole of the agreement?
MR WALKER: No, not at all. I certainly do not equate that because we had an ILUA and there is no evidence, indeed the evidence is to the contrary. We are not saying we will not have an ILUA. The very letter in question is a proposal for an ILUA. It is saying that your $20 million request is rejected and in our submission the notion that we are thereby setting our face against any ILUA is plainly wrong. We are not equating one possible topic of an ILUA with the whole field of what may be covered by an ILUA.
HAYNE J: Your arguments about utility do just that.
MR WALKER: No. An ILUA cannot help us if we have no ATP. That is all we are saying. An ILUA may be able to help us with other things but they will not be able to help us with such difficulties we have by not having an ATP. That is not saying that the ATP issue is the whole ground that might be covered by an ILUA.
FRENCH CJ: Mr Walker, we might come back at 2.15 to visit the middle ground, or what Justice Hayne might call the killing ground.
MR WALKER: Thank you.
FRENCH CJ: Adjourn until 2.15.
AT 12.48 PM LUNCHEON ADJOURNMENT
UPON RESUMING AT 2.18 PM:
FRENCH CJ: Yes, Mr Walker.
MR WALKER: Your Honours, can I attempt an answer to Justice Hayne, please. For the purposes of the answer, I want to put to one side by assuming, for the sake of argument, that the plaintiff in question has sufficient interests so as to have standing. Now, I put it to one side explicitly because obviously questions of standing or interests can merge in the way the Court has discussed from time to time into questions of jurisdiction and, indeed, into questions of matter in the sense of a real controversy. But for the purposes of the argument, and in an attempt to focus our answer in principle to Justice Hayne’s question, which we call in aid to obtain success in this argument, I will put it to one side.
If, between negotiating parties, a point of dispute arises, certainly one that is a legal dispute, and probably also one that was a factual dispute, which was critical to the ongoing carriage of negotiations, either so as to permit them to go ahead at all, or so as to affect their content materially, then all other things such as standing being equal, the Court may, jurisdictionally, be able to participate by an appropriate declaration.
Whether it would, would depend upon the same facts which would also have produced an assessment by the court as to whether those conditions exist, has a point been reached in negotiations where it can be seen that there is an identifiable contentious matter between parties for whom it will matter because this is critical to.
CRENNAN J: A declaration has consequences.
MR WALKER: Quite. The converse, to pick up what Justice Crennan has raised with me by way of, with respect, appropriate emphasis, is that if, however, in relation to the requirement that the matter be critical, if it can be seen that there are other matters – an obvious one to raise by way of illustration from this case would be price – if there are other matters equally or also critical to the question of whether the negotiations will reach any conclusion or if so, what, or whether they had failed to reach any conclusion, if there are other matters apart from that proffered to the court, then, in our submission, that is classically hypothetical. In other words, this point may never matter between the parties. The court can see not simply purely theoretically but also from the facts of the circumstances showing the dealings between the parties that there may be other reasons.
GUMMOW J: It is this expression “may never matter” that may be difficult though.
MR WALKER: Yes. I am not saying mere theorising will do, that is, fantastic imaginings of possibilities. I am talking about, what do the facts show. Now, the facts show in this case, if I can move from attempted articulation of principle to this particular case, the facts show that the question of an ILUA providing for consent to that which we regarded as very likely to be PERBAs, that question is inextricably linked with the request for $20 million on that account, or on that account plus other things, so price.
GUMMOW J: If you look at a contract case, a particular point may never matter because there is another issue pleaded in the alternative. It does not mean you do not get a declaration on the first branch.
MR WALKER: No, I accept that, and I am not talking about in court alternatives, your Honour, because I, with respect, accept that just as alternatives can nonetheless yoke two separate arguments together as one matter, so they could still preserve something as being critical in the sense that I have described. I am talking about out of court dealings where it can be seen from the facts that are drawn to the court which has been asked by one party to grant a declaration, where it can be seen from those facts drawn to that court’s attention that there are realistically other reasons beyond the reach of the proposed declaration by which the negotiation in question may not reach any conclusion or a conclusion of a kind sought by the moving party, then, in our submission, the court would not intervene.
GUMMOW J: Well, the question then is, what do you mean by realistically?
MR WALKER: Yes, it does, I do, and none the worse for that as a test because, in our submission, that is the kind of epithet that is appropriate when one considers the judgmental or evaluative exercise involved, such as the Chief Justice referred to in the AGL Case, as to whether something is truly concrete enough as a controversy so as to avoid the stigma of being too hypothetical for the grant of declaratory relief. It does involve assessment of the possibilities, and a mere argumentative theorising about how the negotiations might otherwise proceed would be one thing, something that you can invite as a plain inference from the facts before the party would be another.
It is another in this case because the material to which we draw attention shows that price – we jibbed immediately at the price, more than $20 million. That was the lead proposition which led us to assess against it what we saw as the worth for the purpose of the negotiations of what we were being offered, namely, consent to something that we thought we did not need consent to at all. It is to be recalled as well in relation to the Court’s determination of whether it is a case fit for declaratory relief, including the related but not exactly similar issue as to whether it is a matter, it is to be recalled as well, concerning declaratory relief, that in this case, there does not appear to be any right involved concerning negotiations for an ILUA. Now, that requires elaboration.
Your Honours have had drawn to your attention by me clause 2.4 of the former ILUA which, although it has played no part in the plaintiffs’ stance to date, ought properly to be seen as having produced, as it did, the negotiations to which my client’s letter referred and of which my client’s letter is, of course, an important part. Had there been a dispute between the parties about the meaning or effect of clause 2.4, it does not require much imagination to see that what in New South Wales used to be called a vendor purchaser summons may have been the best way to settle the issue, by which I mean drawing to attention that the parties were in dispute about whether there was any obligation to negotiate and, it may be assumed, parties being otherwise in good faith, as contracting parties may be, notwithstanding they disagree with each other, come to court with either agreed or easily established facts, very often with a summons in the form of a question asking whether (a) or (b) or (a) or not (a) is the case in light of the contractual terms and in the facts which have happened, but that does not appear to be this case at all for reasons both which we have covered in our written submission and as I have already touched upon in address and which I will elaborate further.
This is not a case when one looks at the pleading and the particulars in the pleading, where the other side, that is, the plaintiff says that we have ever maintained a position as follows, that is, the petroleum defendants saying “Consent to a 1923 Act petroleum licence based upon an authority to prospect presently in existence cannot, as a matter of law, be the subject matter of any kind of term or condition in an ILUA, and therefore, we will not talk with you further on that topic”.
Now, a moment’s reflection - of course, one does not find that in the correspondence. To the contrary, there was a substantive negotiating response by us in our proposal of 4 November 2005 in the letter to which I have gone, which made it clear that on price and our evaluation of risk terms we were not going to make them the so‑called gift. I need, at that stage, to take your Honours back, if I may, to that letter. On the succeeding page, 176 of the book, you see just after line 20 a reiteration of the so‑called “strong view” expressed in terms about line 25 of:
the right to negotiate provisions are unlikely to be applicable to operations within . . . the propose 5 year term –
et cetera. Then it shades off into questions of royalties, the whole letter concluding at page 177 by expressing a belief concerning the contribution this letter makes to the resolution, providing a response to matters that had been raised, and then:
Should there be any outstanding issues I would appreciate your advising me of them as soon as is possible, but in any event prior to next week’s meeting.
FRENCH CJ: The reality on the ground, to put it colloquially, must be that the application or non‑application of the right to negotiate provisions of the Act to a petroleum lease to which your client would assert a right, pursuant to its ATP, would be a matter of great significance in the negotiation, would it not?
MR WALKER: Unquestionably, and it has been considered ‑ ‑ ‑
FRENCH CJ: I mean, it is always about that.
MR WALKER: It has been about that. That is what this letter records. We have thought about it. It is obviously a risk to be bought out, if it is worth buying it out. The assertion put in negotiations is we assess the worth of that risk. In terms of the price, we would be prepared to get rid of it, as not what you are asking, $20 million.
FRENCH CJ: Does that not tell us something about the utility of obtaining a declaration as to your client’s right?
MR WALKER: In our submission, there is no utility presented except, and I stress, except by the frank full on determination of whether our ATP is valid. Now that, however, is what has been withdrawn, it would appear, by the amendment to the application.
CRENNAN J: Why would not the first declaration sought on paragraph 13 have some consequences for the negotiating parties?
MR WALKER: I need to answer that in a slightly roundabout way. If it were possible on the position taken by the plaintiffs in this litigation for declaration 1 to be granted in the terms there set out, it would unquestionably be most useful. Now, I need to explain why that is not the plaintiffs’ case and they really cannot be heard today to say it has ever been their case.
CRENNAN J: Well, I was understanding Mr McCarthy to be suggesting that the relief sought would have foreseeable consequences in terms of the objects of the Act, part of which is the validation of the past Acts.
MR WALKER: He does say that. However, declaration 1, and I can do this with declaration 2 as well, cannot possibly have any such utility given the way in which the plaintiffs have advanced their position in the Federal Court. Now, that requires explanation because if there is one thing that is clear on the face of declarations 1 and 2, prayers 1 and 2, declarations in their terms would of course be - perhaps “useful” is a hard word from my client’s point of view - they would be highly significant.
GUMMOW J: We are talking about jurisdiction of the Federal Court, Mr Walker. Are you saying that a grant of declaration 1 would have been beyond the jurisdiction of the Federal Court?
MR WALKER: If declaration 1 ‑ ‑ ‑
GUMMOW J: Forget about how the parties are running the case and what was or was not in that. Just focus on the question of jurisdiction. Would that have been beyond jurisdiction?
MR WALKER: No, your Honour, for the same reasons as applies with an appropriately couched and presented vendor/purchaser summons.
GUMMOW J: The other arguments you are advancing may go to discretion in this Court as to relief under 75(v). I have no view about that at the moment, but I do not think you escape the necessity to answer a case of jurisdictional error by referring to what would be discretionary factors, perhaps, in a suit here under 75(v).
MR WALKER: I accept that entirely. It will not answer a jurisdictional error argument to call in aid discretion. I agree, with respect.
GUMMOW J: This is not an appeal and it is not a Coulton v Holcombe situation.
MR WALKER: Quite so. What I want to say about declarations 1 and 2 is that if these proceedings were ever before Justice Logan and the Full Court of the Federal Court, on the basis of what I will call a Native Title Act argument that a valid authority to prospect leading to an otherwise valid, I stress otherwise valid, petroleum lease would, nonetheless, not be a PERBA and would, see declaration 2, would be subject to the right to negotiate provisions of Subdivision P of Division 3 of Part 2, if that were the case presented by the plaintiff, then everything that Justice Gummow has put to me and Justice Crennan has put to me to consider, with respect, would be answered by me, yes, within jurisdiction, useful, real.
What I hope to demonstrate in the next few minutes is that that has never been the case and is not the case today. They do not say that there is any reason for declaration 1 or 2 to be made other than their pleaded assertion that the authority to prospect does not exist, and so that there never can be – see paragraphs 11 and 13 of their pleading at pages 20 and 21 – there can never be the issue under the 1923 Act based on that ATP, now long expired they say, of any petroleum lease; they have only ever said that position.
Now, I can go much further on the basis of their express concession, that is a demonstration of their position in the courts below and in this Court, but before I do let me just underline my concession. Both prayers 1 and 2 until one sees what litigation they are advanced in give rise to issues which are of course real in relation to differences between parties. Whether they are real in relation to differences between these parties would have required, had there been any such argument, investigation of whether the grant of a petroleum lease was in the offing – let me assume that is so – and finally a question of standing or interest sufficient for the plaintiffs to advance it because they would be attacking our title.
Now, they have not undertaken to prove anything about their native title. They have not undertaken to plead or prove anything in relation to any other form of title, all they say is they are registered claimants. In our submission, that would not provide sufficient interest, but I do have to deal with an alternative, separate mode of arguing sufficient interest or standing which comes from the unquestionably peculiar and important role given to the negotiation of ILUAs.
It is to be recalled that ILUAs bind people who presently do not exist, they have a binding effect not restricted by privity, and we accept that that provides a setting in which there may be a special form or a particular form of interest or standing given. However, because we have not taken any position ever in negotiations saying, this could not be the subject of an ILUA, that standing does not arise. We have never said, it cannot be an ILUA therefore we will not talk to you about it. That is not a point of difference between us. So we come back to the issue – the only issue they have ever based themselves on is your ATP cannot provide the foundation you believe it does for the future grant of 1923 Act petroleum leases; that is their only point.
FRENCH CJ: I am just wondering how that sits with paragraphs 13c and 13d ‑ ‑ ‑
MR WALKER: Very oddly.
FRENCH CJ: ‑ ‑ ‑ which seem to rest upon the premise that – or the assumption that there would be a valid grant under State law. In other words, it reads as though there are alternative cases being run – and 6 as well, of course.
MR WALKER: I immediately accept as an addition to the points I have already made about prayers 1 and 2 that there are passages which, until all the facts are known about this litigation, facts that I am about to make known, would certainly give rise to the possibility that there is, if I could put it this way, lurking behind both prayers for relief and parts of their pleading an argument that says a valid ATP producing an otherwise valid petroleum lease would still not be, for some reason or other, a PERBA, and would still, for some reason or other, be subject to right to negotiate.
I agree that that is what appears on its face, but that has never been their position, and is not today their position. They have only ever said it was because, under State law, the authority to prospect had disappeared.
HAYNE J: A party can come to court saying there is no window, it is not broken, and a party can say, can it not, there is no window at all? Is that not the position being adopted by the plaintiffs? The petroleum defendants have no title. If they have title, it will not have the effect under the Act.
MR WALKER: They appear not to want that relief – see the amendments by way of deletion to their application. That is the first thing. But yes, of course, they say, and that is why I conceded earlier, as between us and anybody else withstanding to raise it, the question of our authority to prospect is a very real important issue, of course. If somebody had sufficient interest to say “You have no interest and no title under the ATP, and I ask the court so to declare”, then there would be no dispute from us about the non-hypothetical nature of the dispute. We certainly contest that they have interest in what I might call the “plain vanilla” issue – is our authority to prospect valid or not?
They have not shown they have any title, which is affected by the authority to prospect at all. They have not shown that they enjoy any right title or interest of any kind which would be, in any way, trammelled by that authority to prospect, or anything that might flow from it. But your Honours, the first thing, can I take you to the way in which the matter was presented before the learned judge at first instance, as recorded in his reasons, page 34 of the book, paragraph 15, which records at about line 22 or so, the conventional or necessary assumption or “the factual foundation of the Applicants’ case”, for the purposes of a summary judgment application, we gather that our friends see that as incorporating the question of whether, as a matter of law, the 1923 Queensland Act authorised the purported extensions. That is how it is been argued today.
We could take issue with that – those are not matters of fact, but with respect, it is an appropriate assumption to be made for testing all of the arguments in this Court. Then, however, we go to 16(b), where his Honour was summarising the contentions before him, and in 16(b), the plaintiffs said that the declaration - that the grant of a petroleum lease would not constitute a PERBA does not require the Applicants to establish that they have native title – so an answer to a standing question ‑ ‑ ‑
GUMMOW J: Sorry, where are you reading from, Mr Walker?
MR WALKER: Paragraph 16(b).
HAYNE J: Paragraph 17(b), I think, Mr Walker.
MR WALKER: I am so sorry, it is 17 ‑ ‑ ‑
CRENNAN J: Top of page 35.
MR WALKER: I apologise, 17(b) at the top of page 35. The declaration, though it would not be a PERBA, does not require them to establish native title, which was an issue between us:
because, if there is no valid ATP, it necessarily follows that there could be no valid grant of a petroleum lease.
That is our point earlier. If there is no grant of a petroleum lease, there is no question of it being a PERBA. Indeed, there is no question of it being a future act and nor is there any question of consent by an ILUA or determination under right to negotiate having any effect on what I will call its validity. There is nothing to be validated or preserved from invalidity. We entirely agree with their logic there.
FRENCH CJ: It means as a practical consequence, does it not, that the only way, if that be right, that the petroleum defendants get a petroleum lease is by a fresh grant?
MR WALKER: That is right.
FRENCH CJ: That is a future act and obviously that then comes in the scope of the ‑ ‑ ‑
MR WALKER: We have no dispute about that, yes.
FRENCH CJ: So I am just wondering whether we have been distracted a little. This is, in a sense, tangential to what you are saying, but I wonder whether we are distracted a little by the accrued jurisdiction argument in relation to the State claim. If the State claim goes to the question whether or not there is a right or a potential right which is covered or within the coverage of an ILUA, an area ILUA, as defined by the Native Title Act, may not that be a matter arising under a law of the Commonwealth and therefore of itself a matter of federal jurisdiction even though it is agitating the question of State law validity?
MR WALKER: Yes, probably, your Honour, yes.
GUMMOW J: All this accrued jurisdiction is a bit of a sideshow.
MR WALKER: I am not concentrating on that at the moment, your Honour.
FRENCH CJ: No, I appreciate it is a little tangential, but then you come back and say really it is the – you say there is some inconsistent logic between the declarations they are seeking and the basis upon which they are putting their pleading.
MR WALKER: Yes, and we say it is fatal.
FRENCH CJ: That is on the basis that there is no alternative case being run?
MR WALKER: That is right. I should say, there has never been an alternative case adumbrated to this minute. Could I take your Honours, please, to the written submissions in this Court, paragraph 21. In answering what probably was an error in the Full Court our friends say this:
If ATP 259P is valid under Queensland law, the [petroleum] defendants have a right under s 40 of the Petroleum Act 1923 (Qld) to be granted petroleum leases –
and we all agree on that –
It is that right which, if it exists, would make such a grant a PERBA as asserted –
So they have never said if granted it may still be a PERBA and they have never said if granted it may still be subject to right to negotiate. Paragraph 24 makes it even clearer:
If the [petroleum] respondents are correct in asserting that the grant of petroleum leases emanating from ATP 259P would be a PERBA –
and then it is their words –
the ILUA need not deal with that act so as to ensure its validity because it would be valid by virtue of –
In other words, accepting entirely the reasoning which was in our letter back in 2005. In short, the only point they have ever advanced is we raise the threat of destroying your ATP. They wrongly suggest that that means – sorry, that is something that they can deal with in an ILUA by validating it. Now, what I need to concede, however, is that an ILUA, which has a very broad scope of matters that may be dealt with, an ILUA could unquestionably include a term which, for example, barred people of a particular description, maybe only the people who make it, maybe this would not bind others, but certainly bar people of a particular description from raising a contention anywhere under State law that the authority to prospect was invalid, so as to nullify, avoid or invalidate any purported issue of petroleum leases based on it.
In other words, you could sell your liberty to make a contention or to litigate and that would be something which a party made that proposal in negotiations would no doubt evaluate for what it is worth. In that sense of course it could be the subject of an ILUA but there will be no part for a court to play in that at all. We have in particular never said that could not be the subject of an ILUA, just as we have never said we will not negotiate about this matter, we have negotiated about this matter.
That is why when you put together the attitude by the plaintiff which is simply to say, “We threaten destruction of your ATP, deal with us, give us $20 million worth of land”, and we say, “No, we disagree with your assessment of the worth of that threat”, nothing is raised which in principle permits a court to interfere by saying that the ATP is valid or not. That is not to say if they had standing that they could not directly in the Supreme Court of Queensland raise the point, or if it be capable of being made into federal jurisdiction, in the Federal Court. That is simply not, in our submission, what is being argued in this case.
Therefore, it being clear that the plaintiffs accept that an ILUA need not deal with the issue of a petroleum lease if the ATP is valid, we are left with the question, is there anything critical to negotiations in the sense that I have explained earlier in the proposition that they are right about the fact that the ATP does not exist so as to found the grant of a 1923 Act petroleum lease. For the reasons that everyone seems to agree on there could be no question of a PERBA, no question of a future act, no question of consent under an ILUA, validating in any way either the ATP or anything purporting to emanate from it.
KIEFEL J: Is the question about the ATP bound up in the order for an injunction under paragraph 6 of their application necessarily?
MR WALKER: No, we do not understand that to be the case and I stand to be corrected. I think the record permits only the understanding that that is based upon the alleged invalidity of the ATP, and that is all, I think – I may be wrong. Now, the next proposition concerns the right to negotiate. If the right to negotiate has not been honoured then acts to which it applies will be invalid. That much is clear and never controversial.
In this regard I will refer generally, deferring to Queensland’s submissions, to sections 24IB and then the bifurcation required by that section between 24IC, which is our case, or – the bifurcation into the other case which is 24IC, which would lead in due course to a determination as contemplated by 25(1)(aa) with all the provisions concerning determinations.
That, of course, shows that an ILUA is not critical or essential at all. It is entirely voluntary. We do not have to deal with anything and the plaintiffs do not have to deal with anything by an ILUA. It can be done, if they are correct, about a right to negotiate in that fashion. However, at that point it is worth going, with respect, to the way in which our learned friends put the matter in this Court in paragraph 29, on the second page of that paragraph. There it is said, perhaps with an ambiguous use of language, that:
The grant of a petroleum lease under the Petroleum Act 1923 emanating from ATP 259P done in respect of the claimed land is an act, which, if it is a future act as defined in s 233, may be validated by the registration of an ILUA
Now, that has to be seen, of course, in light of what has been very plainly put in paragraphs 21 and 24, namely, you do not need an ILUA before a PERBA and if the authority to prospect be valid, then what you will get will be a PERBA, not might or anything like that, it will be, and, with respect, that is a correct analysis. That sentence at the top of page 10 of the written submissions in paragraph 29 by our friends, with respect, is either wrong or needs to be heavily interpreted.
At that point, then, can I also go to the language and concept. We say there is a fatal or contradictory illogic within the declarations of the other side. Can I take you to declaration 2 on the book page 14. Now, when I do this somewhat gingerly, I have to remind the Court that although on the face of this it seems to suggest there is an argument other than State invalidity of the authority to prospect, in fact, we now know there is not; never has been and still is not. Nonetheless, what declaration 2 talks about is validity in a certain circumstance “would not be valid unless” translates, of course, as meaning, “would be valid if”. Now, that comes down to the proposition that they were advancing, perhaps they never really were, but the words suggest they were advancing the proposition ‑ ‑ ‑
GUMMOW J: Sorry, why does it translate into “would be valid if”?
MR WALKER: If somebody seeks a declaration that something would not be valid unless requirements have been satisfied, in our submission ‑ ‑ ‑
GUMMOW J: May still be invalid for some other reason.
MR WALKER: Your Honour, I am not supporting this as a form of drafting of declarations. In our submission, as a matter of English what this means, however legally inappropriate, what it means is to convey the notion that it is failure to satisfy the requirements of Subdivision P which would destroy validity from which it would appear to follow, leaving quite aside matters that Justice Gummow has drawn to attention which would need to be attended to, the drafter appears to be saying “it will be valid if”. In any event, the declaration would be defective for a number of reasons including that it may not be covering all the universe of possible issues necessary to make it useful.
CRENNAN J: As I pointed out this morning, that is all premised on the grant being a future act for the purposes of 233 of the Act.
MR WALKER: Quite, which itself is premised upon it actually being a valid Act under Queensland law. It cannot be a future act under 233 unless it validly affects, or would but for the invalidity otherwise dealt with by the Native Title Act, validly affect ‑ ‑ ‑
CRENNAN J: This sort of goes back to your argument about the main claim here is that it is not a PERBA, because the ATP is not valid, so there is a grant of nothing valid.
MR WALKER: That is right.
CRENNAN J: Therefore, you cannot get the future act that you need for the last three lines of the declaration to be operating on.
MR WALKER: Precisely, quite.
FRENCH CJ: That throws up a logical inconsistency, if it be good, between a pleaded case and relief.
MR WALKER: Yes, it does.
FRENCH CJ: But that does not go to jurisdiction, does it?
MR WALKER: I am not suggesting it does.
FRENCH CJ: No. So the jurisdictional issue only goes off on the basis there is no matter, which, as Justice Logan – and we have passed that by now – so this is really into “got no reasonable prospect of success” territory.
MR WALKER: Yes, and also of no utility.
HAYNE J: As to both the utility and prospects point, is a possible point of view that the drafting of the declarations owes much to the assertion that is made at page 175 of the application book?
MR WALKER: It might, but that would not vindicate the choice of words.
HAYNE J: Where the petroleum defendants assert a compound proposition.
MR WALKER: Yes.
HAYNE J: What the declaration is seeking in each case to focus upon is the negative of the Native Title Act element of that compound proposition.
MR WALKER: Yes.
HAYNE J: The Native Title Act conclusion being that which is relevant to the plaintiffs.
MR WALKER: Maybe, maybe not. In terms of the bargaining counter, one could take a broader view that they are perfectly content with defects at State law, because they…..to sell their quiescence about it.
HAYNE J: The observation that it has, at all times, been the plaintiffs’ case that your side of the record trips at the point of valid ATP and has no further separate argument which would have the Native Title Act consequence asserted in the letter takes on the significance you attribute to it only because of the way in which your side has run the case, does it not, namely that you accept that there is not this alternative argument which might otherwise have been thought to be pregnant in 175 when cast in negative terms.
MR WALKER: Justice Logan took the same view, and the plaintiffs’ counsel take the same view in their written submission.
HAYNE J: Just so, but having regard to the fact that the negative of 175 would be a negative pregnant.
MR WALKER: No doubt, your Honour, but this is a ‑ ‑ ‑
HAYNE J: And your side has never sought to have that delivered of child.
MR WALKER: This is a negotiating document.
HAYNE J: Yes.
MR WALKER: As long ago as 2005. According to the plaintiffs’ pleading and particulars, you do not hear about anything else until 2008 when all there is done is a paraphrase of this part of the letter and a requirement that there be capitulation or there will be litigation, and that is what happened. Now, there is nothing at any level, including discretion, against my clients or vindicating any illogic on the plaintiffs’ side in the way in which we express the matter at page 175. We made very plain our proposition that the ATP being valid, it would lead to an automatic grant of production licence, as they are called there, the petroleum lease. They would be PERBAs and, as such, were not subject to the right to negotiate.
That appears to be – not appears to be – it is in terms accepted by the plaintiffs at every stage in this litigation, notwithstanding what I readily concede is the uninstructed, ordinary English reading of not only their prayers 1 and 2, but certain parts of their pleading as well. But the point is they have never argued it that way and in terms of doomed to failure, you can be doomed to failure because notwithstanding your pleadings appear to hold out that you were going to argue that even a State valid petroleum lease would be a PERBA or would be – would not be a PERBA or would be subject to a right to negotiate, in fact, you never argue it and you assure the court you have only one argument on the point, then, with respect, it is bordering on the duty of the court so to proceed, not to attribute to parties arguments they do not have and are not willing to embrace.
There is no alternative argument. It has never been put forward. I stress, the plain words in this Court are, if the ATP is valid, conclusion, no right to negotiate and it is a PERBA. It is for those reasons, in our submission, that utility is lacking in the sense that we have otherwise developed in our written submissions.
In relation to discretion about which some of my submissions and address have already touched, we have put very briefly in our paragraph 63 of our written submissions a matter which has, so far as we can see, remained completely unanswered. It is a separate, sufficient reason for this Court to refuse relief.
GUMMOW J: Paragraph 63?
MR WALKER: It picks up paragraphs 55 to 57 of Justice Logan’s reasoning. So far as Lardil is concerned we rest on our written submissions making this observation, that the reasoning we have advanced in my address to date so far means that it is not really necessary to deal with Lardil. First, in relation to the way in which Lardil had been argued before Justice Logan in the Full Court, that is, so as to distinguish it, we simply adopt and, with respect, the way in which the Full Court dealt with that, and Justice Logan. So far as the proposition raised in this Court, if it be raised, that Lardil is an authority that ought to be overruled by this Court in the critical aspect upon which we relied on it, then, in our submission, we need to observe that that has not been the position taken in the courts below. The Full Court records, indeed, at page 303, line 10 that there was no argument to that effect.
GUMMOW J: Before you glide away from paragraph 62, what the primary judge was saying at pages 46 and 47, in particular in paragraphs 56 and 57 about staging posts would have been helped by a consideration of Sir Garfield Barwick’s judgment in Sterling Nicholas 126 CLR at 305, would it not?
MR WALKER: Yes, your Honour.
HAYNE J: To the extent to which his Honour at paragraph 57 embraces an argument advanced on your side of the record, what exactly is meant by saying the litigation or the declarations for “staging post” to the end of an assertion in the future of a right to negotiate?
MR WALKER: It is a staging post because, of course, there has not yet been either the grant of a lease or for that matter, determination of native title.
HAYNE J: It seems to cut across all that you have been addressing and so on in the last half hour, I would have thought, Mr Walker?
MR WALKER: No, not at all, your Honour. It is in that sense the “staging post” reference of Mr Justice Young quoted in paragraph 56 would apply.
GUMMOW J: Now, you may also be left in a situation, Mr Walker, where you have some allies who you really might wish were joining some other alliance. Are you now entirely at idem with what is in Queensland written submissions? I would have thought not, nor with the Commonwealth submissions, either, the Commonwealth being an intervener.
MR WALKER: I do not want to say anything about what the Commonwealth has said concerning certiorari in cases of this kind and it does not place me at odds with it. If your Honour is inquiring concerning matters of jurisdiction ‑ ‑ ‑
GUMMOW J: Yes, accrued jurisdiction for one. I thought that rabbit had vanished down a hole with a smile, after what the Chief Justice put to you.
MR WALKER: Yes. Your Honour, I do not wish – in relation to accrued jurisdiction this case does not turn, in our submission, on simply that point, namely that there could be no accrued jurisdiction to entertain ‑ ‑ ‑
GUMMOW J: Implicit in it is some thought that one must not really get into the Queensland legislative structure.
MR WALKER: I cannot and will not put that. With respect, my friends have not put that either.
GUMMOW J: One should be cautious about getting into the Queensland legislative structure but the fact is it is caught up with the native title system.
MR WALKER: Explicitly, yes. My friends do not put that either. We do not cut across them in that regard. May it please the Court.
FRENCH CJ: Thank you. Ms Webb.
MS WEBB: May it please the Court. It would be helpful, I think, given the discussions that have been had this morning and after lunch to go to in fact the structure of the Native Title Act in respect of future acts and I will hope to deal with it shortly. We do deal with it in our submissions starting at paragraph 49 and it is one of the main objects of the Native Title Act to establish ways in which future dealings affecting native title may proceed and set standards for the dealings. If your Honours go to section 24AA of the Native Title Act, you go to Division 3 of Part 2 of the Act, and that commences with the detailed provisions regarding future acts.
Section 24AA is an overview of that, but before that it is necessary to understand how “future act” is defined, and it is defined in section 233(1) of the Native Title Act. The relevant points are that it is an act that if its legislation is “after 1 July 1993”, “any other act” after 1 January 1994, “not a past act”, that is in there because there are some acts in the future that fall within the “past acts” definition ‑ ‑ ‑
FRENCH CJ: Renewals and extensions.
MS WEBB: Yes. Then you go to (c), the first point is that:
(i)it validly affects native title in relation to the land or waters to any extent; or
(ii) the following apply:
(A)it is to any extent invalid; and
(B)it would be valid to that extent if any native title in relation to the land or waters did not exist; and
(C)if it were valid to that extent, it would affect the native title.
Number one, it has to be a valid act. Then if it is invalid because of the existence of native title, it is invalid to that extent, and what the future act regime does is provides processes by which you can validate that invalidity, but it is only that invalidity to the extent that it affects native title. There is no process in the future acts regime to validate an act that is invalid under State law.
Section 227 – and we have set it out in our submissions – defines what is meant by the phrase “An act affects native title”. When you have identified what a future act is then the Native Title Act provisions deal with the validity or invalidity of the future act, bearing in mind that is invalidity because of the existence of native title, they deal with the consequences of doing the act in terms of the effect on native title and compensation, and in fact most of the future act provisions, including a pre‑existing rights based act, the consequences are – non‑extinguishment principle applies. It is only some cases where there is extinguishment, some specific cases.
Then the Act deals with procedural rights that are required to be conferred in the context of doing the act. In some cases they are quite significant. In others there might be a right to be notified. In some cases there is not even that, but there is a right to compensation and that is a pre‑existing rights based act. It is valid. The non‑extinguishing principle applies, there is compensation payable. To go through the regime of the act, what is dealt with are a number of ways that you can deal with future acts to ensure their validity and you get an overview in section 24AA(4) as to what those processes are.
FRENCH CJ: In this case we are really concerned about the indigenous land use agreement provisions and their effect and also the potential of Subdivision P.
MS WEBB: Yes, your Honour, and also the pre‑existing rights based acts provision.
FRENCH CJ: Yes.
MS WEBB: So if you look at these provisions, what you have, and as your Honour the Chief Justice correctly commented, there were amendments in 1998 that strengthened, indeed, the future act regime and in fact one of the reasons to do that was to address a lack of certainty. In the explanatory memorandum your Honours were taken to, in paragraph 7.2, it is set out there in the context of ILUAs that one of the reasons that the ILUA regime was put in place in terms that it is, is in fact designed to give security for agreements with native title holders. If you go to the indigenous land use agreement sections, there are three types of indigenous land use agreement. There is body corporate agreements, there is area agreements and there is alternative procedure agreements.
What we are dealing with here are area agreements and in each of these categories, the Native Title Act provides for who must and may be parties to an indigenous land use agreement. They are dealt with in 24BD, 24CD, which is the relevant one here, the parties to the area agreements. It sets out who needs to be a party to the kind of ILUA we are dealing with. It deals with the essential subject matter of an indigenous land use agreement, 24CB, and with respect to that, your Honours, when you are looking at the essential subject matter of an indigenous land use agreement, your Honour Justice Hayne referred to, I think, section 24ID(1)(c) in respect of the effect of the registration of an agreement.
I think it was the effect of the registration of the agreement. Your Honours will bear with me. Perhaps I will come back to that. What we do is it deals with the essential subject matter of an indigenous land use agreement. It does not try and regulate the conduct of the terms and conditions of those agreements that are entered into. It deals with the procedure that is involved in applying for the indigenous land use agreement to be registered on the register of agreements. Importantly, it deals with the effect of a land use agreement, once it is registered. There we have the ILUA taking effect, as if it were a contract. It also goes between the parties that have entered into it, but it also binds other persons. That is section 24EA(1)(b).
The provisions of the Native Title Act that were referred to by your Honour Justice Heydon as potentially indicating an intention by the Parliament to control the negotiation of indigenous land use agreements, in fact, do relate to a different aspect of those agreements, with respect. That is namely the requirement for the land use agreements to be authorised by all those who hold, or may hold, native title in relation to an area that is covered by such an agreement. That is an essential prerequisite for registration.
Those provisions are section 24CG, you have an application for registration. Section 24CG(3)(a) you get certification by a representative body. That in turn can depend on authorisation. Then you go to 24EA, the requirement for authorisation makes sense once you understand that the effect of an ILUA being registered binds parties, binds persons who were not parties to the agreement. The section 24CF as to assistance being provided by the Native Title Tribunal does not, in our submission, indicate some voluntary negotiation that somehow that becomes a statutory process because the Tribunal can provide some sort of assistance.
FRENCH CJ: This all tends to the proposition that is set out in 41 and 42 of your submissions, does it not?
MS WEBB: It is, indeed, your Honour and that is really what it is going to. The point about it is it is a voluntary process. Under the Native Title Act it is a voluntary process. There is nothing there, nothing at all, that would indicate that there is any duty or obligation under the Native Title Act for persons to enter into indigenous land use agreements. If they do then the process is that you do not need to go to other subdivisions in order to ensure the validity of your Act. But if you do not then you go along the process to find the process that your Act falls under and one of those is Subdivision P, which is the right to negotiate and that right to negotiate is what, in fact, falls into some of the declarations being sought by the plaintiffs in this case.
GUMMOW J: But in this case there was the contractual genesis, was there not? It was not a voluntary process.
MS WEBB: Yes, your Honour, and we concentrate on what the Native Title Act itself says. We say the Native Title Act does not ‑ ‑ ‑
GUMMOW J: I know, but that process under the Act was triggered by 2.4(a) on 124. It was a performance of an obligation amongst these parties.
MS WEBB: Yes. Our submissions are made on what the Native Title Act itself says, in relation to indigenous land use agreements. You do not have to. The agreement between parties as to whether they will negotiate, that is an issue that my learned friends have dealt with. The Native Title Act itself does not provide a duty or an obligation to negotiate an ILUA. In the plaintiffs’ case their contention is that a dispute arises in the course of the indigenous land use agreement negotiations and that the appropriate scope of the agreement being negotiated is a matter arising under the Native Title Act. The particular dispute ‑ ‑ ‑
FRENCH CJ: Well, that is put at a fairly high level of generality. I suppose one has to look at the particular dispute, does one not?
MS WEBB: Yes, and that is what I was going to, your Honour. In fact, it is said in a number of places in their submissions. The particular dispute, they say, throughout their submissions is whether the grant of a petroleum lease under section 40 of the Petroleum Act 1923 emanating from authority to prospect 259P is or is not a pre‑existing right based act, the PERBA. The only reason, as my learned friend, Mr Walker, said, that the plaintiffs say it is not is on the basis that that authority to prospect no longer exists. It is the only basis.
They expressly disavow that in their proceeding before Justice Logan that they were trying to enforce procedural rights under Part 2 of Subdivision P of the Native Title Act, expressly disavow that, and at the same time, when you look at the relief that is sought, it appears that they do seek an entitlement to the procedural rights under Subdivision P. If you look at application book 14 in the relief they seek, particularly declaration 2:
A declaration that the grant of a petroleum lease . . . would not be valid pursuant to s 24ID of the Native Title Act1993 (Cth) unless the requirements of Subdivision of Division 3 of Part 2 of that Act had been satisfied.
In their amended statement of claim again, at application book 19, paragraphs 6 and 13d. It is not clear how these positions are to be reconciled. However, if the plaintiffs are not in fact seeking to enforce their procedural rights under Subdivision P, it appears that what they want is to obtain a declaration that Subdivision P must theoretically be complied with in respect of the grant of petroleum leases under section 40 of the 1923 Act and then to assert that because of that declaration, the proposed grantees of those petroleum leases are under an obligation to negotiate in respect of those petroleum leases under an indigenous land use agreement or else they have to comply with the right to negotiate in Subdivision P.
FRENCH CJ: Not under an obligation to negotiate under the ILUA because, as you point out, nobody is under an obligation. Rather, that that is something they are going to have to deal with either under Subdivision P or under the ILUA and so come to the party ‑ ‑ ‑
MS WEBB: It is a choice, your Honour.
GUMMOW J: You took us to 24EA and looking at the earlier agreement made in 2001, I think, was it not ‑ ‑ ‑
MS WEBB: Yes, 2001, I think.
GUMMOW J: Why was not 2.4(a) something sourced not only in contract but also sourced in 24EA(1)?
MS WEBB: My understanding is, your Honour, it was not registered. It was never a registered agreement.
GUMMOW J: It was never registered?
MS WEBB: Never registered.
BELL J: Can I just inquire, Ms Webb, the petroleum defendants put the matter in this way. The risk that the petroleum lease granted pursuant to the ATP is not a PERBA is one that they have assessed on a commercial basis as not worth buying out. The State has a rather different position in all of this. The State presumably recognises native title and an obligation to respect it and the State is the body required to issue the lease. A mechanism for the State to be satisfied that in granting the lease there is no trenching on native title is the ILUA process. It is just not entirely clear to me why, if there is an issue concerning the status of the ATP bearing on whether it is or not a PERBA and that is having some impact on the question of the negotiation of an ILUA that includes the prospect of the mining lease, why the State would not have an interest in the Court making such a declaration?
MS WEBB: There are two answers to that, your Honour. The first is that on either case that the plaintiffs put the petroleum lease or the not petroleum lease does not fall within the scope of the ILUA. The State’s position is there is a valid ATP in existence and we are entitled to grant petroleum leases in reliance on it under section 40 of the Petroleum Act. The plaintiff takes a different view. That is, as we understand it, really the dispute, but they have done nothing to challenge that and we continue to take the view that the petroleum leases can continue to be granted. The other thing is, if they cannot under the ATP, if we are wrong, then the consequence is for the indigenous land use agreement there is nothing to be negotiated about.
BELL J: I understand that. The State’s position is, it is a risk so low that it is ‑ ‑ ‑
MS WEBB: That is right, your Honour.
BELL J: Right, I understand.
MS WEBB: Governments and, I think, commercial parties assess the risks and in some cases if there is some uncertainty, they may comply with – but there are other cases where they say, “No, we have assessed this, this is a pre‑existing rights based act that we are doing, we are covered by that provision. You take the consequences if you want”.
FRENCH CJ: Or you get the act changed and veto the intermediate ‑ ‑ ‑
MS WEBB: The other thing to point out, as I perhaps did not – sorry, your Honour ‑ ‑ ‑
FRENCH CJ: I said, or you get the act changed and veto the intermediate past acts regime.
MS WEBB: I am not quite sure how ‑ ‑ ‑
FRENCH CJ: Which is a legacy of risk taking.
MS WEBB: Yes, your Honour. Could I make a further point, however, your Honour Justice Bell. It is that a pre-existing rights based act cannot be said not to respect native title. It is a non-extinguishing ‑ ‑ ‑
BELL J: I am not suggesting it for a moment. The matter I was raising with you was the rather different position of the State with the obligations that it has in a context in which there is an issue concerning whether or not the grant of the lease would be a PERBA. I think your answer is the State says that is simply not a risk.
MS WEBB: And to date the plaintiffs have not challenged what the root of it is and that is the authority to prospect.
BELL J: That might be thought to be a different matter. One can understand ‑ ‑ ‑
CRENNAN J: Are there rights of objection, are there, statutory rights of objection?
MS WEBB: To a pre‑existing rights based ‑ ‑ ‑
CRENNAN J: No, to an ATP.
MS WEBB: There already is an authority to prospect, your Honour.
CRENNAN J: Yes, I know. I was just asking you as a theoretical matter whether there would be the ability to object to the grant or the renewal or matters of that sort.
MS WEBB: Your Honour is asking in terms of if there was a further, another authority to prospect granted under the ‑ ‑ ‑
CRENNAN J: Well, even if there was a renewal, is there any statutory process for objecting? That is all I was asking.
MS WEBB: What I can say to your Honour, there is no basis to object to a petroleum lease being granted emanating from an authority to prospect. That is a right and that is how it comes into being the pre-existing rights based act. I am not sure about the authority to prospect.
CRENNAN J: That is why Mr Walker used the word “automatic” when he was ‑ ‑ ‑
MS WEBB: Yes, it is automatic.
KIEFEL J: But are you saying that, nevertheless, they could have but have never sought a declaration as to the validity of the ATP and therefore the issue of the lease?
MS WEBB: That is right, your Honour. There is a way it could be done in the native title proceedings. They have native title proceedings on foot and these matters arise all the time in native title proceedings, but it has not been done. Can I just return to and, I think, perhaps to repeat a point that I was making about the entering into and negotiating indigenous land use agreements is a voluntary process. Other subdivisions in the future act regime deal with procedural rights and in some of those there are statutory rights and obligations to do certain things. There is no such thing in relation to the ILUAs.
Perhaps to return to the point about procedural rights, if a native title claimant wants to enforce procedural rights, for example, under Subdivision P, if that is what the plaintiffs in this case were doing – they say they are not – if they wanted to do that, they could do that in an interlocutory context. That process is clearly explained in Lardil in Queensland, (2001) 108 FCR 453, relying on Fejo v Northern Territory of Australia (1998) 195 CLR 96. The gravamen of Lardil ‑ ‑ ‑
FRENCH CJ: What does this go to in the context of the current matter before us?
MS WEBB: It goes to trying to work out, your Honour, what the plaintiffs are actually doing here. They are saying we are not – perhaps I will not develop it much further, simply to say, if you wanted to get relief in relation to protecting your procedural rights, you can seek interlocutory relief.
FRENCH CJ: They are not asserting something in the context of a Subdivision P process. It is a sort of bogey down the track which feeds into a current negotiation process.
MS WEBB: Yes. We are trying to find out in fact what they are. In fact, could I just say very briefly, that is the basis in which they distinguish Lardil and say it does not apply, we are not asserting procedural rights. Can I go back to another assumption and another basis on which the plaintiffs distinguished Lardil? It is in paragraph 25 of their reply. There they say the “claim for declaratory and injunctive relief” is premised on the assumption that is brought to ILUA negotiations. The assumption is set out in paragraph 24 which the plaintiffs assert as underlying ILUA negotiations is (a) that native title exists, and can I insert, one, that is implicit, that it may be affected by an act and therefore that the act may be a future act that needs the consent of the native title party under an ILUA to be valid.
That is the context in which the plaintiffs say they bring this proceeding. Therefore, if there is a dispute as to the scope of the ILUA there is no need to establish any of the assumed positions. It is sufficient that the dispute arises in the course of the negotiation. That seems to be the way it is brought to the Court. However, once parties disagree in relation to a particular class, act or class of acts, as they do here, and one party seeks declaratory or final injunctive relief to resolve that disagreement, it is no longer possible to rely on those assumptions. To obtain the relief that is sought the party that is seeking it must establish there is a concrete factual situation on which to base the decision.
What the plaintiffs’ position implies is that whenever parties are in ILUA negotiations and there is a disagreement about the application of the Native Title Act to a class of acts or about any of the things that may be the subject matter of an indigenous land use agreement, and there are many, if your Honours look at section 24CB, then registered claimants without more could obtain declaratory or final injunctive relief without having to satisfy any of those elements of the future act. Here, one of those elements is that it is valid. It is a valid act.
HEYDON J: The idea that people cannot go to courts of law to see what their rights are, or at least the idea that one should erect as many obstacles as possible to that is a strange one. If the parties collide and have little controversies about legal problems why can they not get a declaration from the court?
MS WEBB: Your Honour, the point that we are making in relation to the ILUA negotiations is what is the right that they are seeking? What is the right that they are seeking to have declared or enforced?
HAYNE J: That is the difficulty, Ms Webb. You focus only on the position of the plaintiffs. You say the plaintiffs have no right but do the plaintiffs have an interest in determining what the defendants’ rights are?
MS WEBB: This is where we get to in fact – and I will get to it – the futility of the relief and the way they seek it. The real right – what will actually assist the plaintiffs to determine what right the defendants have – the first and third defendants have – is to in fact determine the issue of the authority to prospect, but that is the one thing that they have asked the court not to determine below. It is the thing that they took out, it is the relief they took out of their application before Justice Logan.
HAYNE J: We have just heard an address from Mr Walker saying that their only complaint in the Federal Court was that the authority to prospect is bad. That is the position, is it not?
MS WEBB: The basis on which they put – they sought the relief was that, but they did not want that particular issue determined. Now, if we go on the basis that authority to prospect is bad, let us say it is, the State is confident it is not, but if it is, the point is that if the authority to prospect is bad there is no petroleum lease to negotiate about; everyone agrees on that.
HEYDON J: Ms Webb, I cannot believe that section 31A of the Federal Court of Australia Act is to be invoked in the Full Court and the High Court where all we are debating is the merits of the form of a particular declaration. If it is merely a question of the form of the order, that is not a matter for section 31A.
GUMMOW J: That seems to be the message of Spencer, I would have thought.
MS WEBB: Well, Spencer as I understand it, your Honour, would support that if you cannot get the relief you seek then it would be a case for summary dismissal under section 31A. We say that very clearly. The relief that the plaintiffs sought simply was not available on the way they pleaded it.
FRENCH CJ: We are slipping away here from a jurisdictional question into a problem of disconformity between pleadings and relief.
MS WEBB: Yes.
KIEFEL J: Is it also a question of conformity between pleadings and assertions in the letters on which the pleadings are based?
MS WEBB: I must say, your Honour, that we have concentrated simply on the pleadings and have not brought into our considerations how those pleadings might have come into play.
KIEFEL J: Right.
MS WEBB: If your Honour pleases, I cannot assist with that.
KIEFEL J: I think the pleadings were particularised.
MS WEBB: Yes. Perhaps to reinforce, it is the real dispute, the real dispute is the validity of the ATP, and it has been repeated I think a number of times. The only basis on which the plaintiffs put their case is the ATP does not exist. Not conceded, but we make that assumption. If it does exist, then the plaintiffs agree that the grant of a petroleum lease and reliance on it is a pre‑existing rights based act within the meaning of section 24IB to which Subdivision P does not apply.
FRENCH CJ: I think we have more or less been into this territory already and the State of Queensland hopefully will focus upon what is particular to it.
MS WEBB: That is right, your Honour. It is an odd concept to go to the court and seek a declaration ‑ ‑ ‑
FRENCH CJ: I think we understand that point.
MS WEBB: ‑ ‑ ‑ that something is invalid and which – yes. Can I just briefly say in relation ‑ ‑ ‑
GUMMOW J: Queensland seem to say it is clear enough to us, we do not want any court interfering and telling us something to the contrary of what we think is pretty clear.
HAYNE J: “Don’t you worry about that”.
GUMMOW J: Yes, there seems to be an echo of “Don’t you worry about that”.
MS WEBB: Well, your Honour, if the plaintiffs support an action and actually sought to have the issue resolved of the ATP, we would deal with it.
HAYNE J: Passing strange that we should have heard an address from the petroleum defendants which is devoted entirely to the proposition that that is what their complaint was in these proceedings, Ms Webb, and yet these submissions are now made. There we are.
MS WEBB: What we have said in our submissions is that the Federal Court could not determine the State law issue on the basis of accrued or associated jurisdiction and that is because there could be no accrued jurisdiction where there is no federal matter. That is at paragraph 86 of our submissions. It is dealt with also at paragraph 21 with the first and third defendant submissions and paragraph 50 of the Commonwealth submissions.
Can I repeat again that the plaintiffs did not press the relief in relation to the invalidity of ATP. That is at application book 14, line 20 where that declaration is crossed out. Justice Logan records in his Honour’s reasons for decision at application book 34, line 17, paragraph 15 that he was not asked to determine either summarily or as a separate question of law the merits of the State issue, but we say, going beyond that, even if a controversy attracting the Federal Court’s jurisdiction could be found for all the reasons that we have discussed, the plaintiffs could not obtain the relief they seek. They are pleading that the authority to prospect no longer exists, remove the foundation for the relief that they seek. It removes any ability for ‑ ‑ ‑
FRENCH CJ: We are going around in circles here.
MS WEBB: Yes. Can I go to another reason why declaration 2 – we have heard why declaration 1 is flawed. Can I go to a reason why declaration 2 is also misconceived. If the authority to prospect – declaration 2 is at application book 14 at the top of the page:
A declaration that the grant of a petroleum lease to the first and/or third defendants under s 40 of the Petroleum Act 1923 (Qld) in respect of any of the Claimed Land and covered by Authority to Prospect 259P dated 31 January 1979 would not be valid pursuant to s 24ID of the Native Title Act 1993 (Cth) unless the requirements of Subdivision P of Division 3 of Part 2 of that Act had been satisfied.
If the authority to prospect still exists, the grant of the petroleum lease would be a pre‑existing rights based act. Everyone agrees. It is a pre‑existing rights based act within the meaning of 24IB, therefore, it is valid under section 24ID(1)(a):
If this Subdivision applies to a future act:
(a)subject to Subdivision P . . . the act is valid.
That is it. If you want to find out if it is subject to Subdivision P, you go to 26(1A) and you see that:
This Subdivision applies to a future act if:
(a)section 24IC
Well, it is not at 24IC. You go to (1) and it is not Subdivision M, therefore, Subdivision P does not apply. You can go also to 26(2)(a) which, in fact, also confirms that this would not be included as a Subdivision P. So it is valid, you do not have to comply.
If the authority to prospect no longer exists, there cannot be a grant under section 40 of the Petroleum Act, no question of validity under section 24ID, with or without compliance with Subdivision P. As we have said, it would be a matter of invalidity under State law, so that declaration makes no sense at all, on its terms. In an attempt to overcome this, it appears that the plaintiffs have proposed a reformulated version of declaration 2, taking out the reference to section 40, so, they say, a grant could be done under the Petroleum and Gas (Production and Safety) Act.
It still could not be a pre‑existing rights based act in that case, so 24IB would not apply, and it is not the renewal of anything, so 24IC cannot apply, in which case validity under section 24ID does not arise, with or without Subdivision P. It is our submission that on any view the relief cannot be granted, and the short submission that I made is that it is well established that if relief cannot be granted, the proceedings should be summarily dismissed, and I would refer to paragraph 21 of Spencer v Commonwealth – I apologise, the reference I have is (2010) 269 ALR 233. We understand it is now in the Australian Law Journal Reports.
HEYDON J: Just for completeness, what is wrong with order 6? No threat?
MS WEBB: The injunctive relief? The injunctive relief comes into difficulty, your Honour, where they are seeking a final – this is where Lardil may come into play – they are seeking final relief in relation to a grant of a petroleum lease, putting aside everything else, where there is no pleading of the existence of native title, no pleading or assertion that it is going to be affected. As I started in the submissions, certainly we would not disagree that they could seek interlocutory relief, and that seems to be supported, but it is the final relief, without challenging and without having decided the issue of the authority to prospect. That is the State law issue.
HEYDON J: You say they have standing for interlocutory relief, but not final relief, until it has been established that they actually have native title. Is that the proposition?
MS WEBB: It is two things, your Honour. Could I say standing may be an issue, and in relation to interlocutory relief, there are expressions in Lardil as to the standing point. As I recall, your Honour Chief Justice French in Lardil there referred to standing being an issue, and also Justice Dowsett dealt with standing in relation to interlocutory relief, but they may have standing in relation to interlocutory relief, but the difficulty is in relation to final relief. In relation to this issue, if they put it on the basis that they had native title, they would have to establish that, establish that the Act affected it in order to get final relief.
FRENCH CJ: That is if they were seeking their final relief based upon the invalidity of such a grant, for example, under the Native Title Act.
MS WEBB: That is right, your Honour.
FRENCH CJ: If, however, they are seeking final relief based upon the fact that there was no valid ATP and therefore it could not be granted under the State Act, all they need for that is standing. Now, their standing might be, for example, that they are registered native title claimants and that it has various impacts.
MS WEBB: Yes. It may be, we do not concede, they may be able to establish standing, if they did that though.
FRENCH CJ: All I am saying is that that is not a Lardil Case really.
MS WEBB: Yes, your Honour. The way in which they have brought this in this proceeding, however, is the difficulty. It is a State law issue but, in fact, what underlies it is the authority to prospect to get that injunction and they did not want that determined. Can I go to the way that the plaintiffs seem to seek to overcome some of their difficulties in this Court by reference to the Petroleum and Gas (Production and Safety) Act.
I should say in relation to that that I have provided for your Honours copies of the Act. I am not really intending to take you through it in any detail because my first submission on it is this. They cannot overcome their problem this way because they cannot come to this Court on an application under section 75(v), change their pleaded case before the courts below and then seek to have the decisions of those courts struck down on the basis of jurisdictional error relying on a case that is put only in this Court. The suggested amendment to rely on the Petroleum and Gas (Production and Safety) Act would change the character of their case.
FRENCH CJ: There is no evidentiary material relating to the application of the 2004 legislation, is there?
MS WEBB: There is nothing at all, your Honour, and, as Mr Walker put, there is absolutely nothing pleaded. There are no facts in relation to it.
FRENCH CJ: If that were even a possibility it was not agitated below ‑ ‑ ‑
MS WEBB: Never.
FRENCH CJ: ‑ ‑ ‑ speaking for myself it is not clear why we are concerned with it.
MS WEBB: Well, only in reply, in fact, to the plaintiffs’ reply, and I am content not to address your Honours on it, except to say none of the issues arise that they seek relief in their pleadings.
FRENCH CJ: If down the track somebody wanted to grant a lease under that, no doubt it would engage with the future act processes, but we are not looking at that.
MS WEBB: Yes, your Honour.
HEYDON J: You would say it is barred by some Anshun principle probably.
MS WEBB: I am sorry, your Honour?
HEYDON J: No doubt someone would say it was barred by some principle derivable from Anshun’s Case. Paragraph 13.d of the pleading does speak of a petroleum lease without any form of limitation. Paragraph 13c talks of a purported grant under section 40. Paragraph 13d speaks of grant a petroleum lease, but I think I agree with the general mood that we are perhaps wasting too much time on this.
MS WEBB: Yes. I think that is going around. It is still pleaded and it is not understood why the pleading is still there. The pleadings were not amended, but the declaration in relation to invalidity was simply struck out and they did not pursue it.
HEYDON J: But is it not gravid within declaration number 1, the step in the reasoning towards declaration number 1?
MS WEBB: No, it is not, your Honour, because as we have said, if it is not a valid – an existing authority to prospect there cannot be a valid grant of a petroleum lease and their case is always that and that is what was assumed in the court below. That is why this simply does not make sense without the challenge to the authority to prospect. Unless there is anything else, we rely on our written submissions, your Honours.
FRENCH CJ: Thank you, Ms Webb. Yes, Mr Solicitor.
MR GAGELER: Your Honours, I tread uninvited through a thicket, not of my making, in a landscape that has changed during the course of the day and I tread a narrow path. It is not for me as an intervener to seek to characterise the precise controversy between the parties nor the underlying facts and what I have said as an intervener in paragraphs 46 and 47 of the written submissions about the characterisation of the controversy and of the underlying facts may well not accord with the position of the parties as that position has emerged in the course of argument that undermines the utility of what I have to say as an intervener at paragraphs 48 through to 51. I do not ask your Honours to blue pencil those paragraphs entirely because they contain some useful thoughts.
The topic of the existence or non‑existence of a matter within the jurisdiction of the Federal Court is one to which I will return in just a moment. I do have an interest in the circumstances in which certiorari can issue to the Federal Court. That is a topic which is developed in the written submissions at paragraphs 3 to 9. The plaintiffs, we understand, put their case only in terms of jurisdictional error so the burden of those submissions need not be considered. I also have a very large interest in the construction of the Native Title Act.
HEYDON J: That is not a constitutional question. You do not come in here as an intervener by leave. You come in as of right under 78A. It is has to be a question affecting the construction of the Constitution.
MR GAGELER: I can intervene in a matter arising under the Constitution or involving its interpretation.
HEYDON J: Yes, what, and say anything you want to at all that does not have anything to do with the construction of the Constitution?
MR GAGELER: I would contend yes, but, your Honour, it is an argument we need not have because the next sentence that I was about to say was that I have an interest in the correctness of Lardil which does feed in to the existence or non‑existence of a matter, on one view. What we wish to say we have put in writing in paragraphs 10 through to 34 of our written submissions and it appears not to be the main topic of controversy that has been agitated before your Honours today.
I also have an interest in ensuring that no narrow view is taken of accrued jurisdiction and for that reason the point we make in paragraph 52 of our written submissions is that Justice Logan was, on any view, wrong, in our submission, at page 46 of the application book in paragraph 54.
GUMMOW J: I think Mr Walker now accepts the first sentence of your paragraph 52.
MR GAGELER: Yes.
GUMMOW J: I am not sure Queensland does.
MR GAGELER: Yes, that is right. So the point is, if there is otherwise a genuine controversy as to an immediate right, title or duty that owes its existence to the Native Title Act that will be quelled by an order of the court, there is a matter and the fact that the position taken by one side to that controversy is untenable or even illogical does not deny the existence of a matter.
Now, your Honours, I also have an interest in ensuring that no narrow view is taken of what is a matter arising under the Native Title Act for the purposes of jurisdiction under section 213(2) of that Act, and section 39B(1A)(c) of that Act. In our submission, the existence or non‑existence of such a matter is best addressed or usefully addressed in the present context by asking whether such controversy as exists between the parties as might be quelled by the declarations sought is a controversy about some immediate right, title or duty that owes its existence to the Native Title Act. Now, if the previous ILUA had been registered, that might be a rather easy question to answer, but if you start from the position that the parties are negotiating simply pursuant to contract, that falls away.
The effect of what is sought in declaration 1 and declaration 2, as we understand it and as it has emerged within the course of argument, is that the grant of a petroleum lease, if it occurs and if it is otherwise valid and if it is a future act within the meaning of section 24IA, will not be a PERBA and therefore will not be valid under section 24ID. That is, in essence, what is being sought by the combination of those two declarations. Now, one asks, what immediate right, duty or liability under the Native Title Act would be quelled by the making of a declaration substantially or declaration substantially in those terms? Now, one possibility would be a controversy as to the validity or invalidity of the grant, if it occurs and if it is a future act, that invalidity potentially arising under section 24OA.
The plaintiffs simply do not put their case in that way. They do not say that there will be a future act. Indeed, they say that there would be no act at all. The only way the plaintiffs put their case is, as your Honour Justice Gummow pointed out this morning, by reference to paragraphs 32 and 34 of their written submissions go something like this. The parties are negotiating an ILUA. They are engaged in a statutory process and the declarations sought will allow the parties to continue that statutory process and I quote:
knowing the proper scope of the proposed ILUA –
That is the way in which it is put in paragraph 34.3 of the plaintiffs’ submissions in-chief. In our submission, if the parties, in the course of negotiations, get to the point where they have a present, or even contingent, intention to enter into an ILUA, and there exists a current genuine controversy as to what may be covered by that ILUA, what can permissibly be covered by that ILUA, what the procedural rights of the parties are in respect of the ILUA, or what would be the legal effect of the ILUA if covered, then there is a sufficiently immediate connection with rights, duties or liabilities that owe their existence to the Native Title Act. That is simply to apply AGL, which in turn, applied Sterling Nicholas. Whether such a controversy exists in the way in which the positions of the parties have emerged in the course of argument is not something that I wish to make any precise submissions on ‑ ‑ ‑
HAYNE J: That is one form of controversy that might exist. Imagine for a moment that the controversy that existed between the parties can be described as one party to the negotiations asserting that it has a particular form of property which has certain attributes and consequences under the Act and the opposite party denies that that party has property having those attributes and consequences. Is that a controversy that arises under the Act?
MR GAGELER: Yes.
GUMMOW J: That would have to follow from LNC, would it not? It was a dispute over ownership of trademark rights?
MR GAGELER: The question would be whether the relief that is being sought from the Court would quell such a controversy, yes.
HAYNE J: Does it then matter that the denial of the first party’s assertion rests upon the contention that that first party does not have a valid title to the asserted property?
MR GAGELER: One would think, no.
FRENCH CJ: Whether or not that assertion is based on non‑compliance with State law. This is of significance beyond this particular case because, in a sense, the Native Title Act itself is, as you know, part of an interlocking scheme and you have State title validation Acts and so forth which could well come into play in the context of an ILUA negotiation.
MR GAGELER: Indeed. Your Honours, there is the question of whether there would be any right, title or duty to be determined - right, title or duty under the Native Title Act, of an immediate nature, that would be determined by the declaration sought is really quite a different question from asking whether the native title claimants, who are the plaintiffs in these proceedings, would have standing to challenge the existing authority to prospect or to challenge the grant of a new petroleum lease under State legislation. One would think would be a very easy road for them, simply by virtue of being native title claimants, to establish that they have standing on an Onus v Alcoa test.
MR GAGELER: That is really the burden of my argument.
FRENCH CJ: That goes to jurisdiction.
MR GAGELER: Only if one can say that the resolution of that controversy will determine some right, title or duty under the Native Title Act and there lies the difficulty in identifying the particular right, title or duty under the Native Title Act. The existing ILUA is not registered. There is otherwise no duty to negotiate an ILUA under the Native Title Act. Whether or not the petroleum lease is valid under State law, whether or not if valid it is a PERBA really makes no difference as a matter of law to whether the grant can be covered by an ILUA. You just look at the terms of section 24CB to see that. It makes no difference to the statutory process. The provisions your Honour Justice Heydon mentioned this morning would apply in either circumstance. It makes no difference to the consequence of registration under section 24EA. It might conceivably make a difference to the consequence of registration under section 24EB in an unbelievably complicated way.
GUMMOW J: I think we have to avoid getting unbelievably complicated. Reference to LNC Industries (1983) 151 CLR 575 and it is authority for the proposition that a claim for damages for breach of a contract is a claim for relief under State law, but if the contract is in respect of a right, which is the creature of federal law, the claim arises under the federal law. When they are talking about the State law, it does not matter if it is contract law or whether it is common law or statute law, I would have thought the same reasoning applied.
MR GAGELER: Your Honour, I do not disagree with that. The root principle, I think, is Ex parte Barrett, which your Honours returned to in McJannet, but there I think the question is whether the underlying right that is to be vindicated by the action for damages owes its existence to a federal law. That is the question that is ‑ ‑ ‑
FRENCH CJ: Can you remind me of the passage from Barrett again? Was it rights, immunities, privileges and so forth? It was fairly broadly expressed, was it not?
MR GAGELER: Yes. Would your Honour be assisted if I read it? It is in McJannet 189 CLR ‑ ‑ ‑
HAYNE J: Barrett is 70 CLR 141.
MR GAGELER: Your Honour is right, but I think you will have McJannet on the list. Your Honour can go to the source. As recorded in McJannet 189 CLR 654 at 657, the quotation is:
“[O]ne is compelled to the conclusion that a matter may properly be said to arise under a Federal law if the right or duty in question in the matter owes its existence to Federal law or depends upon Federal law for its enforcement, whether or not the determination of the controversy involves the interpretation (or validity) of the law.
GUMMOW J: That is an incomplete statement. It has to be read with Felton v Mulligan to the effect that there is a matter arising under a federal law of the source of a defence which asserts some immunity from a liability obligation owed under non‑Commonwealth law is a Commonwealth law for this federal jurisdiction.
MR GAGELER: Indeed, yes, and far be it for me to ‑ ‑ ‑
GUMMOW J: It is not just a question of source of rights. That is what bedevilled a lot of this argument today which has become increasingly distracting.
MR GAGELER: Yes. A source of rights or an answer to an assertion of rights, your Honour is entirely right. If the Court pleases, those are the submissions we wish to make.
FRENCH CJ: Thank you, Mr Solicitor. Yes, Mr McCarthy.
MR McCARTHY: Your Honours, if I could just make the submissions in reply brief and in reverse. In the ultimate tests that were put in respect of the matter by the Solicitor‑General, I do not hear him putting a position – or he has developed a position from being opposed to the plaintiffs’ case, I would submit, to being in a position that is supportive of the plaintiffs’ case in the way that the matter has evolved.
In relation to my friend who appeared on behalf of Queensland, I just simply submit in relation to the fact that she put a number of times to this Bench and to this Court that the question of the status of the ATP was not challenged by the plaintiffs or in the plaintiffs’ proceedings. Could I just submit that in respect of declaration 1, the validity of the ATP is an essential element in determining whether grants of petroleum leases are PERBAs.
I just submit that in respect of what was submitted for Queensland that it is simply wrong, in relation to what the plaintiffs’ case has been. In respect of Mr Walker and the submissions for the first and third respondents nothing that has been submitted on that behalf and, indeed, of any of the respondents, justifies a striking out of the claim under section 31A. The dispute raises a matter which the Federal Court has jurisdiction to resolve by declaration.
GUMMOW J: Assume you are correct about that, what is then the significance of what seems to be supplementary arguments designed to show an adverse exercise of discretion against you and giving you the relief that there was jurisdiction to give you.
MR McCARTHY: In reply, I would put, your Honour, that those arguments were not of such weight or merit as would justify the striking out of the claim, that it would not, at that level and, with respect, it would not in this Court. Your Honours, if there are deficiencies in the pleadings or in the form of relief sought, that does not justify the striking out of the claim and it
is in that respect that there was argument back and forth in relation to, at times, levels of inconsistency between what was claimed and what was the ambit of the possible orders of the Court, I do not think in the context that any of them were of a cogency that would either detract from the jurisdiction or allow a striking out. We would, your Honours, press the orders that are sought. They are our submissions in reply, your Honour.
FRENCH CJ: All right, thank you, Mr McCarthy. The Court will reserve its decision. The Court adjourns until 10.15 tomorrow morning.
AT 4.14 PM THE MATTER WAS ADJOURNED
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