Global Advanced Metals Greenbushes Pty Ltd v Talison Lithium Australia Pty Ltd
[2018] WASC 159
•29 MAY 2018
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS
CITATION: GLOBAL ADVANCED METALS GREENBUSHES PTY LTD -v- TALISON LITHIUM AUSTRALIA PTY LTD [2018] WASC 159
CORAM: CHANEY J
HEARD: 17 MAY 2018
DELIVERED : 29 MAY 2018
FILE NO/S: CIV 2229 of 2017
BETWEEN: GLOBAL ADVANCED METALS GREENBUSHES PTY LTD
Plaintiff
AND
TALISON LITHIUM AUSTRALIA PTY LTD
Defendant
Catchwords:
Injunction - Contractual provision to resolve disputes by expert determination - Whether same issues arise in court proceedings - Whether defendant's conduct amounts to election not to exercise contractual entitlement or waiver of that entitlement - Whether oppressive or vexatious to continue with expert determination
Legislation:
Nil
Result:
Injunction granted
Category: B
Representation:
Counsel:
| Plaintiff | : | Dr A S Bell SC & Mr A Shearer |
| Defendant | : | Mr G R Donaldson SC & Mr M T McKenna |
Solicitors:
| Plaintiff | : | Allen & Overy |
| Defendant | : | Gilbert + Tobin |
Case(s) referred to in decision(s):
ACD Tridon Inc v Tridon Australia Pty Ltd [2002] NSWSC 896
Baulderstone Hornibrook Engineering Pty Ltd v Kayah Holdings Pty Ltd (1997) 14 BCL 277
BHPB Freight Pty Ltd v Cosco Oceania Chartering Pty Ltd (2008) 168 FCR 169
CSR Ltd v Cigna Insurance Australia Ltd (1996) 189 CLR 345
La Donna Pty Ltd v Wolford AG (2005) 194 FLR 26; [2005] VSC 359
Straits Exploration (Australia) Pty Ltd v Murchison United NL (2005) 31 WAR 187; [2005] WASCA 241
CHANEY J:
The substantive proceedings in this matter concern disputes arising between the parties in relation to an agreement, known as the Reserve Mineral Rights Agreement dated 13 November 2009 (RMRA), under which the plaintiff (GAM) transferred to the defendant (Talison) mining tenements (Transferred Tenements) which enabled Talison to mine for lithium, but otherwise reserved the right to mine all other minerals on the Transferred Tenements to GAM. Of particular interest to GAM is the mining of tantalum. The RMRA contains provisions which provide for certain disputes to be resolved by way of expert determination.
After these proceedings were commenced, and pleadings had been filed by both parties, Talison issued a notice referring a matter in dispute between the parties to expert determination. GAM declined to participate in that process on the basis that the issues in respect of which expert determination was to be sought were issues which fell for determination in these proceedings, and contended that, Talison having raised those issues in these proceedings and having taken steps towards resolution of those issues in the proceedings, it was not open to Talison to seek expert determination. On that basis, GAM now seeks an interlocutory injunction restraining Talison from pursuing any expert determination in respect of the notice of dispute on the grounds that it is vexatious and oppressive for Talison to do so or that Talison has elected not to pursue any expert determination or otherwise waived or acted inconsistently with any right to pursue such determination.
The terms of the RMRA
Clause 7.2 of the RMRA deals with 'New Mining Operations'. It provides that if either party proposes to conduct New Mining Operations then it must give notice of its intention to do so together with a proposed mine development plan to the other party.
'Mining Operations' is defined as meaning 'an operation directed to the mining and Treatment of any Minerals on a commercial basis including pre‑stripping and removal and disposal of overburden and waste in order to produce saleable mineral product'.
'New Mining Operations' are defined as a Mining Operation to:
1.develop a new Ore body within the Transferred Tenements;
2.develop a new underground Mining Operation within the Transferred Tenements; or
3.significantly expand an existing Mining Operation within the Transferred Tenements
which did not exist as at the date of issue of a New Mining Notice.
'Ore' is defined as 'mineralised material located within the Transferred Tenements from which Minerals can be economically recovered'.
Clause 7.2 sets out a number of conditions which are to apply when a notice (New Mining Notice) is given under that clause. Those conditions are designed to accommodate the entitlement of the other party to extract the minerals reserved to them by the RMRA.
Clause 7.2(j) provides:
If there is a dispute arising out of or in relation to this clause 7.2, it shall be referred to an independent expert for expert determination in accordance with clause 14.
The reference to cl 14 is clearly an error, and ought to be a reference to cl 15 which deals with references to an Independent Expert. Clause 15.1 provides:
15.1Reference to an Independent Expert
Wherever under this agreement:
(a)there is a Dispute in relation to a matter that this agreement states is to be resolved by an Independent Expert; or
(b)the parties agree that a Dispute between them shall be resolved by an Independent Expert,
then the Dispute may be referred by either party to an Independent Expert under this clause 15.
Clause 15.6 provides that the Independent Expert must make a determination of the dispute within 40 business days of appointment, which determination will be final and binding on the parties 'except in the case of bias, fraud, manifest mistake or error'.
The claims and counterclaims in the action
In its amended statement of claim, GAM pleads that by a written mining proposal dated January 2017 (CGP2 Proposal) Talison sought approval from the Department of Mines and Petroleum to construct a new chemical grade lithium processing plant including a new 3‑stage crushing circuit which would significantly increase its processing capacity on the Transferred Tenements. The CGP2 Proposal is said to have included reference to a tantalum recovery circuit.
GAM pleads that the CGP2 Proposal was approved by the Department of Mines and Petroleum on 28 April 2017, and that on 22 May 2017, Talison provided to GAM a New Mining Notice (First New Mining Notice) under the RMRA incorporating a mine development plan. It pleads that on 12 July 2017, Talison issued a second New Mining Notice incorporating a mine development plan. GAM pleads that notwithstanding that the Mining Operations referred to in the first New Mining Notice included a tantalum recovery circuit in CGP2, Talison had informed GAM that it proposed constructing CGP2 without a tantalum recovery circuit and was proceeding with the development on that basis. Doing so is said to be a breach of the RMRA. The effect of that breach is said to be that GAM will be unable to extract a proportion of the other minerals, including tantalum, from the ore processed through CGP2 and that the construction of CGP2 will prevent any other further Mining Operations for other minerals being conducted by GAM within the relevant area. GAM pleads that Talison failed to obtain its consent to implementation of the CGP2 proposals and thereby breached the RMRA. That breach is said to be continuing, and to result in GAM suffering, and continuing to suffer, loss and damage. GAM seeks a declaration that Talison is not entitled to construct CGP2 without an integrated tantalum recovery circuit and an injunction restraining it from doing so, various other declarations and injunctions, and damages for breach of the RMRA.
In its defence, Talison pleads that on a proper construction of the RMRA, it is not obliged to construct CGP2 with an integrated tantalum circuit and denies that its failure to do so caused loss or damage to GAM or precluded it from extracting other minerals from the Transferred Tenements. In par 18(b)(i) of the defence Talison pleads that the area in or about the CGP2 site did not contain 'Ore' within the meaning of the RMRA or alternatively other minerals capable of being mined and treated on a commercial basis, and that GAM did not and does not have any present or future ability to extract other minerals on a commercial basis from the area in or about the CGP2 site. On that basis, it pleads that Talison was not required by cl 7.5 of the RMRA to notify and obtain the prior written consent of GAM prior to its commencement of its construction. It denies that GAM has any entitlement to relief on that basis.
The defence then continues to plead facts said to lead to the conclusion that GAM lacks 'clean hands' so as to disentitle it to equitable relief. Talison pleads that by notice dated 28 December 2016 (GAM's Notice), GAM informed Talison that it proposed to undertake New Mining Operations for other minerals within the Transferred Tenements (First GAM Proposal). It pleads that GAM's Notice was not a New Mining Notice because it failed to include necessary information. It further pleads that had the First GAM Proposal been undertaken, such proposal would have resulted in losses to GAM in that the costs of mining and processing tantalum described in the GAM Notice exceeded the price for which tantalum could be sold. That is a matter which, as at 28 December 2016, Talison says GAM was aware. Various other deficiencies of the First GAM Proposal are also pleaded.
Paragraph 39 of the defence, in its original form, pleaded that the First GAM Proposal had not been the subject of detailed analysis by the GAM Board that concluded that mining and processing of tantalum on a commercial basis within the area of the Transferred Tenements the subject of the December GAM Proposal was economically viable. By an amendment to the defence made on 15 February 2018 (February amendments), Talison added particulars to par 39 which pleaded that as at 28 December 2016, GAM had undertaken a limited preliminary review of the economic feasibility of undertaking the First GAM Proposal (which did not have regard to the cost of refurbishing the primary tantalum processing plant) which concluded that the First GAM Proposal was not economically feasible.
The February amendments also added pars 39A to 39L. Following the commencement of this application for an injunction, and shortly before its hearing, Talison filed further amendments to its defence and counterclaim, including amendments to pars 39C and 39D (April amendments). Of particular relevance to the present application are pars 39A to 39D. Those paragraphs are set out below, with the April amendments underlined.
39AOn 22 December 2017, GAM provided a second New Mining Notice informing Talison that it proposed to undertake New Mining Operations for Other Minerals within the Transferred Tenements (GAM's Second Notice).
39BGAM's Second Notice purported to be a New Mining Notice within the meaning of the RMR Agreement.
39CTalison has commenced a dispute under clause 15 of the RMR Agreement (Dispute) on the basis that GAM's Second Notice was not a New Mining Notice within the meaning of the term in the RMR Agreement in that the proposal identified in GAM's Second Notice (Second GAM Proposal) did not relate to Ore within the meaning of the RMR Agreement, further or alternately did not relate to the mining and treatment of Other Minerals on a commercial basis.
Particulars
Talison gave notice in writing to GAM of a dispute arising under clause 15 of the RMR Agreement on 21 February 2018.
Talison's dispute notice is based on the proposition that t
The Second GAM Proposal contemplated operations directed at the mining and recovery of tantalum ore that would result in losses to GAM, in that the costs of mining and processing tantalum described in the Second GAM Proposal exceeded the price for which tantalum could be sold.39CATalison and GAM were unable to agree upon the identity of an Independent Expert to determine the Dispute.
Particulars
GAM rejected Talison's proposal that Mr Campbell Jaski be appointed the Independent Expert pursuant to clause 15.1 of the RMR Agreement for the purpose of determining the Dispute.
Talison relies on the letter from GAM to Talison dated 27 February 2018.
39CBIn breach of clause 15.2, GAM has sought to delay the appointment of an Independent Expert.
Particulars
GAM has directed the President of the Australian Institute of Mining and Metallurgy to not appoint an Independent Expert to determine the Dispute.
Talison will rely on the following documents at trial:
(A)GAM's letter to the President of the AusIMM dated 4 April 2018
(B)GAM's letter to the President of the AusIMM dated 6 April 2018
(C)GAM's letter to the President of the AusIMM dated 11 April 2018
(D)GAM's letter to the President of the AusIMM dated 18 April 2018
39DAs at 22 December 2017, GAM was aware of the fact
pleaded at paragraph 39C abovethat GAM's Second Proposal did not relate to Ore within the meaning of the RMR Agreement, further or alternatively did not relate to the mining and treatment of Other Minerals on a commercial basis.Particulars
The particulars to paragraph 34A are repeated.
The change in the price for which tantalum could be sold between 28 December 2016 and 22 December 2017 did not render the operations the subject of the Second GAM Proposal economic.
The ore proposed to be mined under GAM's Second Notice could not be economically processed in a continuous mining operation.
GAM did not have a feasibility study in respect of GAM's Second Notice.
Further particulars will be given after discovery.
Various other matters which are said to go to GAM's improper purpose in issuing GAM's Second Notice, and to the utility of the relief sought by GAM, are pleaded.
In its counterclaim, Talison repeats pars 30 ‑ 50 of its defence and pleads that GAM's conduct in breach of the RMRA has caused it loss, for which it claims damages.
Talison's notice of dispute
On 21 February 2018, Talison wrote to GAM (Dispute Notice) referring to GAM's Second Notice and its letters of 25 January 2018 and 13 February 2018 regarding the request for variation to Talison's November 2017 New Mining Notice. The letter continued:
GAM's Purported Notice and Purported Variation
3Neither the Purported Notice nor the Purported Variation comply with the RMRA for the following reasons:
(a)neither the Purported Notice nor the Purported Variation identify Ore, in that direct mining for tantalum as proposed is not economic;
(b)the Purported Variation is not a request for a variation to any New Mining Notice issued by Talison; and
(c)GAM asserts that the Purported Notice and the Purported Variation are simultaneously a New Mining Notice and a request for variation; which is mutually incompatible.
The letter gave notice that Talison would refer the dispute to an Independent Expert pursuant to cl 15 of the RMRA.
On 27 February 2018, GAM's solicitors responded. They asserted that underpinning ground 3(a) in the Dispute Notice are issues regarding the proper construction of cl 7.2(a) and cl 7.2(f) of the RMRA and, in particular, whether the notices must 'identify Ore' or concern mining which is 'economic'. They asserted that those issues are questions of law which are not contemplated for resolution under the expert determination regime of the RMRA. Further, they asserted that the notice was vexatious and an abuse of process as the subject matter of the notice forms part of the subject matter of these proceedings and is capable of being dealt with in the litigation so that the proposed expert process would only lead to wasted costs. They also asserted that the notice contained assertions which were inconsistent with allegations made in the pleadings. They called for withdrawal of the notice.
On 1 March 2018, Talison's solicitors responded asserting that the dispute notice 'pertains to the validity of the purported New Mining Notice and variation request issued by your client'. In relation to the alleged abuse of process, Talison's solicitors asserted that 'the issue of validity is an issue expressly referred to in clause 15 of the RMRA to be dealt with by an expert' and that validity of itself is not the subject of any aspect of the litigation, but rather only the consequences of invalidity and GAM's knowledge of that invalidity that is in issue.
Interlocutory steps taken in the proceedings
As noted above, Talison introduced an amendment to its pleading to deal with GAM's Second Notice on 15 February 2018, six days before it sent the Dispute Notice.
On 1 March 2018, a directions hearing was held in the proceedings. The principal issue of debate at that directions hearing concerned expert evidence, and in particular the sequence in which the parties would adduce their expert evidence. GAM argued that the parties should exchange their expert evidence simultaneously, and Talison argued that GAM should provide its expert evidence first, with Talison then to provide responsive expert evidence.
In the course of submissions, counsel for Talison referred to GAM's pleadings as to the impact of Talison's proposed activity and, in particular, the pleaded impact on GAM's ability to extract Ore from the relevant area. He asserted that Talison would need to establish that the Ore to which reference is made is capable of being economically mined 'because that's what the definition is'.[1] He continued 'that means minerals that have been identified and can be mined for economic benefit … and what's effectively being asked is that two different experts give an opinion on the same topic at the same time …'. He described the 'most important question' in the proceedings as 'whether or not Ore is Ore. Whether minerals constitute Ore in various parts of the project'. That is an issue that is also specifically pleaded by Talison in par 18(b)(i) of the defence referred to above.
[1] Affidavit of Denes Matyas Blazer sworn 6 April 2018, DMB 18, page 115.
Talison's February amendments were filed pursuant to orders made by consent on 7 February 2018. Those orders included orders for discovery and inspection requiring the parties to file and serve affidavits of discovery arising from the amended pleadings by 23 March 2018, with inspection to be provided by 29 March 2018. I understand those orders have been complied with. It appears that the orders for discovery were proposed by Talison during the conferral process leading up to the directions hearing.
On 14 March 2018, Talison issued subpoenas to two third parties. One of those was to Resource Capital Fund Management Pty Ltd, calling for the production of documents comprising, evidencing or recording any analysis in respect of tantalum mining operations on behalf of GAM and the preparation or compilation of a plan for tantalum mining operations to be undertaken on behalf of GAM. The other was to Snowden Mining Industry Consultants Pty Ltd, who were involved in the preparation of the mine development plan which accompanied GAM's Second Notice. The subpoena sought the production of a range of documents related to the recipient's involvement in that process.
On 22 March 2018, the solicitors for Talison issued a request for further and better particulars of GAM's reply and defence to counterclaim, including requesting particulars in relation to GAM's denial of par 39E of the defence and counterclaim and seeking particulars of studies in relation to the economic viability of processing tantalum on a commercial basis in relation to the area the subject of GAM's Second Notice.
Jurisdiction
It was not in issue between the parties that the court has jurisdiction to restrain a party from proceeding with an expert determination where there are proceedings in the court dealing with the same dispute.[2] In Straits Exploration (Australia) Pty Ltd v Murchison United NL, Wheeler JA referred to the decision of Heenan J in Baulderstone Hornibrook Engineering Pty Ltd v Kayah Holdings Pty Ltd[3] in which his Honour made an order restraining the defendant from proceeding with a reference to a third party referee pursuant to a dispute resolution clause in an engineering contract. Heenan J had regard to certain practical reasons that supported the order. Those reasons included the expense and delay occasioned by the conduct of two sets of proceedings relating to the same dispute and the potential for inconsistent findings. Wheeler JA described those as 'plainly very important considerations which would alone have justified the order made by Heenan J'.[4]
[2] Straits Exploration (Australia) Pty Ltd v Murchison United NL (2005) 31 WAR 187; [2005] WASCA 241 [30] (Wheeler JA; McLure JA & Murray AJA agreeing).
[3] Baulderstone Hornibrook Engineering Pty Ltd v Kayah Holdings Pty Ltd (1997) 14 BCL 277.
[4] Straits Exploration (Australia) Pty Ltd v Murchison United NL [20].
Waiver or election
Nor do I understand there to have been any serious dispute between the parties that a party can waive or abandon a right to refer a dispute to arbitration, or elect not to do so, so that an arbitration agreement becomes inoperative. That was held to be the case in La Donna Pty Ltd v Wolford AG.[5] In that case, Whelan J cited with approval the conclusions of Austin J in ACD Tridon Inc v Tridon Australia Pty Ltd[6] that there are two forms of waiver that might arise. One was referred to as 'waiver in the stronger sense' arising where a party makes an unequivocal final choice between alternative procedures, and the second was referred to as 'waiver in the weaker sense' which was conduct which might preclude a successful application based on the exercise of the court's discretion.[7] Whelan J concluded that steps taken by the defendant in contesting an interlocutory injunction application, acquiescing in or agreeing with directions made in the proceedings, and participation in the mediation would not, by themselves, be sufficient to indicate an abandonment by the defendant of a contractual entitlement to arbitration. There had, however, also been an application made by the defendant for security for costs. Whelan J found that application to fall into an entirely different category because it was based on the explicit premise that the litigation would proceed to trial in the absence of a settlement and that the matters the subject of the proceeding would be determined by the court.
[5] La Donna Pty Ltd v Wolford AG (2005) 194 FLR 26; [2005] VSC 359.
[6] ACD Tridon Inc v Tridon Australia Pty Ltd [2002] NSWSC 896.
[7] La Donna Pty Ltd v Walford AG [21] – [22].
A similar result was reached in BHPB Freight Pty Ltd v Cosco Oceania Chartering Pty Ltd[8] where Finkelstein J said:
[8] BHPB Freight Pty Ltd v Cosco Oceania Chartering Pty Ltd (2008) 168 FCR 169 [54].
[T]he various steps taken by Cosco in the proceeding indicate a willingness on its part to allow the claim to be resolved by the court. I refer in particular to filing a positive defence, giving and taking discovery and seeking and obtaining an order to cross‑claim. These steps imposed a burden on BHPB consistent only with the premise that Cosco would defend the claim in court: La Donna at 31.
Although those cases deal with waiver or election in relation to contractual entitlements to arbitration of disputes, there is no reason that the same principles would not apply in relation to contractual entitlements to determination of disputes by expert determination.
As noted earlier, Talison did not cavil with the principles set out above. Rather, its position is that the issues arising in the referral to expert determination are not the same issues as arise in these proceedings. I will return to that contention below.
Vexation or oppression
GAM argues that, whether or not Talison has waived any right to expert determination or by its conduct elected to litigate the broad subject matter of the controversy, Talison's initiation of expert determination which overlaps the existing proceedings is both vexatious and oppressive and will have a tendency to interfere with the processes of the court.
GAM relies upon the statement by the plurality in CSR Ltd v Cigna Insurance Australia Ltd[9] where they said the following (footnotes omitted):
[9] CSR Ltd v Cigna Insurance Australia Ltd (1996) 189 CLR 345, 393 ‑ 394.
One well established category of case in which an injunction may be granted in the exercise of equitable jurisdiction is that involving proceedings in another court, including in a foreign court, which are, according to the principles of equity, vexatious or oppressive (117). Thus, it was said in Carron Iron Co v Maclaren (118) that '[w]here [there is] ... pending a litigation here, in which complete relief may be had, [and] a party to the suit institutes proceedings abroad, the Court of Chancery in general considers that act as a vexatious harassing of the opposite party, and restrains the foreign proceedings'.
…
More recently, in Bank of Tokyo Ltd v Karoon (123), Robert Goff LJ pointed out, correctly, in our view, although without specific reference to underlying equitable principle, that foreign proceedings are to be viewed as vexatious or oppressive only if there is nothing which can be gained by them over and above what may be gained in local proceedings. On the other hand, they are vexatious or oppressive if there is a complete correspondence between the proceedings or, in terms used in Carron Iron Co, if 'complete relief' (124) is available in the local proceedings.
The court continued:[10]
[10] CSR Ltd v Cigna Insurance Australia Ltd, 394.
Because the power to grant injunctions in respect of foreign proceedings which are vexatious or oppressive, in the sense described, derives from equity, it is not to be confined to the examples found in the decided cases. Rather, it is a power the limits of which are determined by the dictates of equity and good conscience. Thus, for example, it may be that the bringing of proceedings with respect to one claim is properly to be seen, in the circumstances of the case, as an election either not to proceed on another claim or not to proceed in another jurisdiction, thus giving rise to an estoppel by conduct such that it would be unconscionable for that other claim to be pursued (126) or for proceedings to be commenced in another jurisdiction. In cases of that kind an injunction may issue in restraint of the subsequent proceedings.
While the decision in CSR Ltd v Cigna Insurance Australia Ltd concerned questions of restraint of foreign proceedings, the principles expressed are clearly applicable to separate proceedings commenced within the same jurisdiction and extend to alternative proceedings by way of arbitration or expert determination.
Again, Talison's response to GAM's reliance on those principles is that they are inapplicable because of a lack of correspondence between the proceedings in the expert determination on the one hand, and this litigation on the other. As senior counsel for Talison frankly and appropriately acknowledged, if the issues are the same in both proceedings, an injunction will lie.[11]
[11] ts 89, 17 May 2018.
Do the issues in the two proceedings coincide?
Talison submits that the task of the expert is to determine whether GAM's New Mining Notice and its variation request identify 'Ore' within the meaning of the RMRA, that is, whether it is 'mineralised material located within the [tenements] from which [tantalum] can be economically recovered'. That is a question which, as Talison correctly observes, the expert would be required to resolve within 40 days of the referral of the dispute to the expert. It is said that that is not the issue in dispute before the court in pars 39A to 39F of the defence. It contends that that position is made clear by the April amendments.
So far as questions of waiver or election are concerned, in my view it is appropriate to have regard to the pleadings as they existed at the time the referral for expert determination occurred and the interlocutory steps in these proceedings were undertaken, and not as they appear after the April amendments. That is because the question of waiver or election must necessarily be considered at the time the conduct said to constitute waiver or election occurs.
It is plain that, in the pleading as it stood prior to the April amendments, Talison positively pleaded in par 39C that GAM's Notice was not a New Mining Notice because it 'did not relate to Ore within the meaning of the RMRA'. The particulars as they stood made clear that that plea was based on the proposition that tantalum could not be economically recovered from the relevant area. It was that issue that counsel for Talison described at the directions hearing on 1 March 2018 as 'the most important question' in these proceedings. That is the very issue which the expert determination would be required to determine.
While the April amendments were clearly intended to shore up Talison's position in opposition to the present application, in my view, the pleadings still raise the issue of whether or not GAM's Notice relates to Ore. The amendment of par 39D contained in the April amendments clearly pleads as a primary material fact the proposition, of which it is said GAM was aware, that GAM's proposal did not relate to Ore within the meaning of the RMRA. The particulars to support that fact include that 'the Ore proposed to be mined under GAM's Second Notice could not be economically processed in a continuous mining operation'. The same issue is pleaded by Talison in par 18(b)(i) of the defence.
Even if one is to judge issues by reference to the defence and counterclaim as it now stands, in my view it is clear that the same issue which would be determined in the expert determination falls to be determined in these proceedings.
Talison argued that there is not a complete correspondence between the proceedings in the sense referred to in the passage from CSR Ltd v Cigna Insurance Australia Ltd referred to above, because the clean hands defence, to which pars 39A to 39D relate, is not dependent upon Talison succeeding in establishing that GAM's Notice did not relate to Ore within the meaning of the RMRA. Talison argues that, even if it failed on that point, it could well succeed in its clean hands defence on the basis of all the other matters related to GAM's allegedly improper purpose. Accepting that that may be so, that argument does not assist Talison. That these proceedings involve broader issues than the more confined question referred for expert determination does not affect the application of the principles relating either to election or waiver, or to vexation or oppression by the maintenance of overlapping proceedings. The rationale for the granting of an injunction to prevent duplication of proceedings is not dependent upon the proposition that both sets of proceedings involve all of the same issues. It is sufficient that nothing can be gained in the expert determination proceedings over and above what may be gained in these proceedings. These proceedings clearly raise as an issue for determination whether or not GAM's Second Notice related to Ore. There is no issue that arises in the expert determination proceeding that does not fall for determination in these proceedings.
Some reliance also appeared to be placed by Talison on the proposition that the contractual entitlement to expert determination required the determination to be made within 40 days, whereas these proceedings will not be resolved within that short timeframe. That submission ignores the capacity for challenges to any expert determination that might be made on the basis of a contention of manifest mistake or error on the part of the expert and the potential for litigation over that question. In any event, the provision of a time limit for the expert determination does not, in my view, alter the fundamental proposition that the issue to be determined by the expert is an issue which squarely falls for determination in these proceedings. It is that proposition that is critical, not any question of procedure to be followed in the respective proceedings.
Should an injunction be granted?
As senior counsel for Talison recognised, if, as I have determined, the issue to be dealt with in the expert determination is an issue which falls for determination in these proceedings, then the basis for the grant of an injunction is made out.
The steps taken by Talison in these proceedings are far more extensive than the application for security for costs which was considered by Whelan J in La Donna Pty Ltd v Wolford AG to be sufficient to found the grant of an injunction. The injunction should be granted on the ground that, by its conduct, Talison has waived its contractual entitlement to refer the dispute to expert determination. Furthermore, I consider that the injunction can be supported on the alternative ground that the maintenance of the expert determination proceedings are vexatious or oppressive in the relevant sense.
There are practical reasons why the injunction should be granted, including so as to avoid the expense of dealing with the same issue in different fora and to avoid the distraction from the conduct of these proceedings that would be imposed on GAM in having to deal with the separate proceedings concerning the same issue. There is potential for inconsistent findings. The proposed determination by the expert involves questions of law or mixed questions of fact and law. It is proposed that the expert is to be appointed by the president of the Australian Institute of Mining and Metallurgy because the determination is said to involve 'a technical matter'. The expert would have no expertise in questions of law. There is a risk that the expert's findings on legal issues would, in any event, be subject to challenge on the basis of manifest error or mistake.
Conclusion
For the foregoing reasons, I am satisfied that an injunction should be granted restraining the defendant from pursuing any expert determination in respect of its notice of dispute dated 21 February 2018.
I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
TS
ASSOCIATE TO THE HONOURABLE JUSTICE CHANEY5 JUNE 2018
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