Mangarrayi Aboriginal Land Trust v Banibi Pty Ltd (No 2)

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FEDERAL COURT OF AUSTRALIA

Mangarrayi Aboriginal Land Trust v Banibi Pty Ltd (No 2) [2011] FCA 173

Citation: Mangarrayi Aboriginal Land Trust v Banibi Pty Ltd (No 2) [2011] FCA 173
Parties: MANGARRAYI ABORIGINAL LAND TRUST and NORTHERN LAND COUNCIL v BANIBI PTY LTD (ACN 002 896 442)
File number: NTD 31 of 2010
Judge: MANSFIELD J
Date of judgment: 7 March 2011
Date of hearing: 15 November 2011
Date of last submissions: 9 December 2010
Place: Darwin
Division: GENERAL DIVISION
Category: No catchwords
Number of paragraphs: 30
Counsel for the Applicants: A Glacken SC and R Hay
Solicitor for the Applicants: Ron Levy
Counsel for the Respondent: P McIntyre and B Midena
Solicitor for the Respondent: Midena Lawyers

IN THE FEDERAL COURT OF AUSTRALIA

NORTHERN TERRITORY DISTRICT REGISTRY

GENERAL DIVISION

NTD 31 of 2010
BETWEEN:

MANGARRAYI ABORIGINAL LAND TRUST
First Applicant

NORTHERN LAND COUNCIL
Second Applicant
AND:

BANIBI PTY LTD (ACN 002 896 442)
Respondent

JUDGE:

MANSFIELD J

DATE OF ORDER:

7 MARCH 2011

WHERE MADE:

DARWIN

THE COURT ORDERS THAT:

1.The respondent pay to the first and second applicants their costs of the proceeding to 15 November 2010 to be taxed or agreed.

Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using Federal Law Search on the Court’s website.


IN THE FEDERAL COURT OF AUSTRALIA

NORTHERN TERRITORY DISTRICT REGISTRY

GENERAL DIVISION

NTD 31 of 2010
BETWEEN:

MANGARRAYI ABORIGINAL LAND TRUST
First Applicant

NORTHERN LAND COUNCIL
Second Applicant
AND:

BANIBI PTY LTD (ACN 002 896 442)
Respondent

JUDGE:

MANSFIELD J

DATE:

7 MARCH 2011

PLACE:

DARWIN

REASONS FOR JUDGMENT

  1. This action commenced on 22 September 2010. It progressed quickly as there were issues which were required to be resolved urgently.  It was set down for hearing on 15 November 2010.

  2. It resolved shortly before the hearing.  The respondent consented to the three primary orders sought by the applicants. Orders broadly in the terms of the first three paragraphs of the application were made on 15 November 2010.

  3. The question of costs, including reserved costs, was not resolved. These reasons deal with that issue.  The parties have agreed that the costs issue will be determined on the basis of written submissions.

    BACKGROUND

  4. The Mangarrayi Aboriginal Land Trust (the Land Trust) is established under the Aboriginal Land Rights (Northern Territory) Act 1976 (Cth) (the Land Rights Act). Under the Land Rights Act, it was granted the land known as Elsey Station on 2 February 2000. The Northern Land Council (the Land Council) is a land council established under the Land Rights Act. It has, inter alia, the roles and responsibilities of a land council under the Land Rights Act. Banibi Pty Limited (Banibi) is a company whose shares are held by Mangarrayi Aboriginal Corporation (the Corporation). The Corporation is apparently formed by the Aboriginal persons on or in the vicinity of Elsey Station. Reference is also made in the pleadings to the traditional Aboriginal owners…

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Details
Case
[2011] FCA 173
Decision Date

CaseChat Overview and Summary

The matter before the court concerns the issue of costs between the Mangarrayi Aboriginal Land Trust and Banibi Pty Ltd. The Mangarrayi Aboriginal Land Trust, established under the Aboriginal Land Rights (Northern Territory) Act 1976, holds title to Elsey Station, a piece of land in the Northern Territory. Banibi Pty Ltd, a company held by the Mangarrayi Aboriginal Corporation, was licensed to occupy and use Elsey Station under a Pastoral Land Use Agreement. However, in early 2010, Banibi informed the Northern Land Council that it considered the Agreement void and continued to occupy the station. This led to the Land Council terminating the Agreement, prompting the Mangarrayi Aboriginal Land Trust and the Land Council to seek orders for possession of Elsey Station against Banibi.

The primary legal issue before the court was whether the Mangarrayi Aboriginal Land Trust and the Land Council were entitled to the costs of the proceeding, considering that Banibi had not accepted the termination of the Agreement and the dispute was not fully resolved. The court had to determine whether the applicants were successful in obtaining the primary relief sought and whether the costs should follow the event, despite the unresolved issues. Banibi argued that the matter should be adjourned until the outstanding issues, including the future management of the Banibi Herd, were finally disposed of.

The court reasoned that the Mangarrayi Aboriginal Land Trust and the Land Council were successful in obtaining the primary relief sought, as Banibi acknowledged its lack of reasonable prospect of successfully resisting the relief shortly before the hearing. The court noted that the case was not one where the resolution of the primary issues was equivocal or uncertain. The court distinguished this case from situations where the terms of the resolution were reflective of a compromise. As such, the court found that the applicants were entitled to the costs of the proceeding up to 15 November 2010, to be taxed or agreed.

In conclusion, the court ordered that Banibi Pty Ltd pay the Mangarrayi Aboriginal Land Trust and the Northern Land Council their costs of the proceeding up to 15 November 2010.

Orders

Orders of the court

1. The respondent pay to the first and second applicants their costs of the proceeding to 15 November 2010 to be taxed or agreed.

Note:

Background

Background to the litigation

The question of costs, including reserved costs, was not resolved. These reasons deal with that issue. The parties have agreed that the costs issue will be determined on the basis of written submissions.BACKGROUND The Mangarrayi Aboriginal Land Trust (the Land Trust) is established under the Aboriginal Land Rights (Northern Territory) Act 1976 (Cth) (the Land Rights Act). Under the Land Rights Act, it was granted the land known as Elsey Station on 2 February 2000. The Northern Land Council (the Land Council) is a land council established under the Land Rights Act. It has, inter alia, the roles and responsibilities of a land council under the Land Rights Act. Banibi Pty Limited (Banibi) is a company whose shares are held by Mangarrayi Aboriginal Corporation (the Corporation). The Corporation is apparently formed by the Aboriginal persons on or in the vicinity of Elsey Station. Reference is also made in the pleadings to the traditional Aboriginal owners of Elsey Station. A Pastoral Land Use Agreement (the Agreement), apparently duly executed, between the Land Trust, the Land Council and Banibi was made on 3 December 2004. The agreement was varied by Deeds of 6 February 2006 and 13 November 2008. Under the Agreement, Banibi was licensed to occupy and use Elsey Station on the terms and conditions of the Agreement. The 2008 Deed is apparently executed by two directors of Banibi, the Land Trust, and the Land Council. It also contains a Direction of the Land Council, having satisfied itself of the requirements of s 19(5) of the Land Rights Act, to the Land Trust to execute the Agreement, and an authorisation apparently signed by three members of the Land Trust authorising its Common Seal to be placed on the Agreement. In early 2010, Banibi and the Land Council exchanged correspondence. That correspondence included a letter from Banibi of 2 February 2010 by which it informed the Land Council (as agent of the Land Trust) that it regarded the Agreement as void and not binding upon it. Banibi was presumably referring to the Agreement as varied by the two Deeds, and in particular the 2008 Deed. It also said the Agreement made on 3 December 2004 then remained in force. On its terms, the 2004 version of the Agreement expired on 22 February 2010. Nevertheless, Banibi continues to occupy Elsey Station. After further correspondence, on 27 May 2010 the Land Council, on behalf of the Land Trust, gave notice of termination of the Agreement. It did so because, it said, Banibi had repudiated the Agreement, and it accepted that repudiation. It also relied on the failure of Banibi to comply with a request under the Agreement for access to Banibi’s audited financial accounts for 2008-2009. Banibi however did not accept that it should no longer occupy Elsey Station. There was a potential stalemate. That ultimately led to this action to resolve the stalemate. The application by the Land Trust and the Land Council sought orders for possession of Elsey Station as against Banibi and consequential orders, and was accompanied by an apparently straightforward statement of claim. Particulars of the statement of claim were requested and provided. Banibi filed its defence on 22 October 2010. That defence introduced further interested groups or entities into the picture; the traditional Aboriginal owners of Elsey Station, and the Corporation. It also made various allegations relating to the Land Council’s conduct and claims for relief.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

That is the context in which the issue as to costs arises. There has been no adjudication on the merits of the claim, but on its face Banibi appears to have accepted that it can no longer remain on Elsey Station under the terms of the Agreement in the events which are alleged to have happened.CONSIDERATION Section 43 of the Federal Court Act 1976 (Cth) gives the Court a discretion to order costs in any action. The discretion is unfettered, save only that it be exercised judicially and not against a successful party except for some reason connected with the case: Grey v Mango Pre Paid Calling Cards Pty Ltd [2005] FCA 362. Generally an order for costs follows the event, and is to be taxed on a party/party basis. However, if the substantive issues have not been determined by the Court, it will usually make no order as to the costs of the proceeding as there has been no hearing on the merits: L & A Maglio Pty Ltd v Commissioner of Taxation [2007] FCA 1365 at [22]-[24]. In Re Minister for Immigration and Ethnic Affairs; Ex parte Lai Qin (1997) 186 CLR 622, McHugh J said at 625:If it appears that both parties have acted reasonably in commencing and defending the proceedings and the conduct of the parties continued to be reasonable until the litigation was settled or its further prosecution became futile, the proper exercise of the cost discretion will usually mean that the court will make no order as to the cost of the proceedings. In this matter there is material which enables me to go beyond that starting point. The applicants contend they were wholly successful in obtaining the primary relief sought in their application. They achieved that outcome upon Banibi acknowledging, by submitting to the orders made, that it had no reasonable prospect of successfully resisting the relief sought. They say they are therefore entitled to the costs of the action, as costs should follow the event, and it was not a matter where the parties’ ultimate agreement made the need for the action academic at any earlier time than 15 November 2010. Banibi asserts that the matter was settled without disposing of the real issues between the parties. It identifies the outstanding issues as being or including whether or how the Banibi Herd would remain on Elsey Station, the legal authority of the Land Council as agent of the Land Trust to grant or direct the grant of licences to other so called ‘former sub-licensees’ of the Land Trust, and the non-payment of rents by those former sub-licensees. Banibi contends that the matter remains to be finally concluded and may not resolve itself if the parties are unable to negotiate the further management arrangements for the Banibi Herd. In that event the matter may return for a determination as to whether or not Banibi is trespassing by virtue of the presence of the Banibi Herd. Banibi argues the question of costs should be adjourned and not determined until the whole issue of the Banibi Herd is finally disposed of. As I have noted, the outcome of the action is that the applicants succeeded in obtaining the primary relief they sought. They did so only at or shortly before the hearing. A few days before the hearing, Banibi’s written submission indicated that at that time it still disputed the entitlement to the third primary claim, and it was not until shortly before the hearing that its position changed. Clearly, the case is not one where the Court does not know how the parties resolved the primary issues in dispute. Nor is it one where the terms on which the action was resolved are equivocal, in the sense of reflecting some compromise of the respective position. The present position may be contrasted with that addressed by Hill J in Australian Securities Commission v Aust-Home Investments Ltd (1993) 44 FCR 194. See also Balgra Shopping Centre Management Pty Ltd v Commissioner of Taxation [2010] FCA 1172 at [22]-[24].