Jemena Gas Networks (NSW) Limited v Mine Subsidence Board

[2010] HCATrans 332

[2010] HCATrans 332

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S165 of 2010

B e t w e e n -

JEMENA GAS NETWORKS (NSW) LIMITED

Applicant

and

MINE SUBSIDENCE BOARD

Respondent

Application for special leave to appeal

GUMMOW J
HAYNE J
HEYDON J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 10 DECEMBER 2010, AT 9.40 AM

Copyright in the High Court of Australia

MR R.J. ELLICOTT, QC:   Your Honours, I appear with MR J.R. WILLIAMS for the applicant.  (instructed by Freehills)

MR S.J. FREE:   If your Honours please, I appear for the respondents.  (instructed by Crown Solicitor’s Office)

GUMMOW J:   Mr Ellicott, before calling on your opponent there are one or two matters we would be assisted with some clarification from you.

MR ELLICOTT:   Yes, your Honour.

GUMMOW J:   Justice Basten was critical of the sparse nature of the agreed facts, if I can put it that way.  Is there any deficiency in the agreed facts which would handicap an adequate consideration of the construction issues of the statute that arise?

MR ELLICOTT:   Not in our submission, your Honour.  There is one issue about causation and that comes after the construction issues.  If we lost on those then the question of causation comes up and in relation to that we would say that there is really – I had a look at the question because I thought the Court might ask it.  I came to the view, looking at it again that the facts were sufficient, having regard to the nature of the argument that we were putting.

GUMMOW J:   Thank you.  Yes, the second – could you just look at your reply for a minute on page 131 of the book, paragraph 18?

MR ELLICOTT:   Yes, your Honour.

GUMMOW J:   What is the force of what is being said there?

MR ELLICOTT:   It is saying that section 13A has limited application because the Board has to be satisfied that the costs of the preventative works would not reduce the total prospective liability and the prospective liability is what would have to be paid if the subsidence occurred and damage followed.  In other words - if I can illustrate it by this case – if it decided – if an application had been made by my client and it decided that the cost of the damage to the pipeline would be less than the costs of preventative works, or mitigatory works, then under this section they would have to decide not to proceed with those works.  That is what Justice Basten was saying at that point.

GUMMOW J:   An important factor being that the Board acts unilaterally, rather than upon application.

MR ELLICOTT:   Yes, that is right, and if you wanted to challenge that you would have to take it under judicial review and it would not be under section 12B as this Court discussed it in Alinta, a previous case.

GUMMOW J:   Yes.  Thank you, Mr Ellicott.

MR ELLICOTT:   If the Court pleases.

GUMMOW J:   We would be assisted to hear from Mr Free.

MR FREE:   May it please the Court.  Your Honours, special leave should be refused because the appeal, if leave were granted, has insufficient prospects and does not raise a question of law that is of general importance.

GUMMOW J:   The Court of Appeal divided three to two.

MR FREE:   Yes, your Honour.  On that question, and the significance of that division of opinion on that question of construction, it does play into the question of the significance of that more broadly.  The difference between the majority position and the position adopted by Justice Basten, with whom Justice Macfarlan agreed, is really quite a narrow one.  It has significance, obviously, on the facts of this case but otherwise it is of marginal significance in the scheme of the Act and has no broader significance obviously outside New South Wales or even within the scheme of this New South Wales Act it is of limited significance.  The causation point which is the third argument advanced by the applicant is entirely specific to the facts of this case and has no broader significance.

GUMMOW J:   The Court of Appeal had a lot of difficulty, if that is the word, in considering the Wambo decision 154 LGERA 60. What do you say about that?

MR FREE:   Your Honour, we say the way in which the majority dealt with Wambo in the present case was correct.  The significance of Wambo is really that the applicant had sought to rely on a particular comment by Justice Tobias in one paragraph of Wambo.  We say the explanation of that given by Chief Justice Spigelman in the present case is, with respect, correct - that is in paragraph 54 of the Chief Justice’s judgment – and that as his Honour concluded, on the facts of this case, the applicant would not succeed in coming within the circumstance that Justice Tobias contemplated in that paragraph of Wambo in any event.

Your Honours, if I can deal briefly with the first construction point which is the matter about which the judges divided in the present case in the Court of Appeal, the reasoning of Justice Basten attached particular significance to the opinion of the Board being the relevant matter for the application of section 12A(1)(b).  That is undoubtedly correct but it does not resolve the question of what is the relevant point in time.

One still needs to ask what is the nature of the opinion which the Board is required to form where - and this is an important distinction – one is dealing with expenses already incurred because the subsection contemplates two types of applications, where dealing with expenses already incurred the Board is required to consider a past point in time and ask whether the owner could reasonably have anticipated that damage would otherwise have arise from the subsidence that has taken place.

Justice Basten attached particular significance to the use of the word “has” in that context and said if it was talking about subsidence that had necessarily occurred by the point at which expenses were incurred it would be a more natural use of language to say “had” rather than “has”.  Now, when one is dealing only with expenses incurred that is true but when one steps back and sees the subsection is dealing not only with expenses incurred but also expenses proposed, and the words need to deal with both those types of applications, the matter loses its force because the words dealing with proposed expenses are all in the present tense.

Helpfully to your Honours, if I could direct you to page 57 in the book in paragraph 81 of the Chief Justice’s reasons.  His Honour has broken down the alternatives that flow from section 12A(1)(b) and the distinction between claims in respect of expenses incurred and claims in respect of proposed expenses.  Focusing on the second bullet point, it is claims:

“proposed . . . (to prevent or mitigate) damage . . . that, in the opinion of the Board, the owner . . . could reasonably anticipate would otherwise arise . . . 

“from a subsidence that has taken place”.

Focusing on those words, if the legislature had used “had” it would not have made any sense, given the tense of the language.  Once that consideration is taken into account, in my submission, the use of “has” rather than “had” loses its ‑ ‑ ‑

GUMMOW J:   You might be right about all of this but the question is whether there is a sufficient doubt involved to warrant special leave.

MR FREE:   Your Honour, on that question I have addressed my client’s position on the correct construction and it is worth noting as well that, to the extent that Justice Basten would have preferred a different view, his Honour did not conclude that the construction in Wambo, as favoured by the majority, was clearly wrong.  As a result the position, as far as the Court of

Appeal is concerned, is settled.  The construction is settled and in any event, as I have submitted, it is a narrow point of no broader significance.

Your Honours, the second construction is not a construction which has found favour with any of the eight judges of the Court of Appeal who considered this.  It is directly inconsistent with the conclusion of all of those judges that the reference to a subsidence that has taken place must refer to an actual past event.  That is fatal to the second construction. I need say no more about it.

The third argument that I have already touched upon is really one of fact.  There is the issue with the potential deficiency of facts that Justice Basten alluded to and the learned presiding judge has referred to this morning but, in any event, that is a matter that does turn on the facts of this case and does not warrant a grant of special leave.  May it please the Court.

GUMMOW J:   Yes, thank you, Mr Free.  Yes, we do not need to hear you in reply, Mr Ellicott.  There will be a grant of leave in this matter.  I take it it would be a one‑day case.  Counsel may not be fully apprised of this, but a new set of High Court Rules comes into effect in the new year.  It would be useful, in view of the transition, if the notice of appeal were to be filed as soon as possible.  The District Registrar will be in contact with the solicitors in the next couple of days to liaise the transition from the one system to the other.  It is quite a different system as to the steps that are taken in between the grant of leave and the hearing of the appeal.  The other thing I should alert counsel to is it may be that an appropriate listing would be in the March/April sittings of the Court.

MR ELLICOTT:   If the Court pleases.

AT 9.53 AM THE MATTER WAS CONCLUDED