Mineralogy Pty Ltd v Sino Iron Pty Ltd & Ors

[2021] HCATrans 055

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
Perth No P16 of 2017

B e t w e e n -
MINERALOGY PTY LTD ACN 010 582 680
Applicant
and
SINO IRON PTY LTD ACN 058 429 708
First Respondent
Korean Steel Pty Ltd aCn 058 429 600
Second Respondent
CITIC Limited
Third Respondent
CITIC Pacific Mining Management Pty Ltd ACN 119 578 371
Fourth Respondent
Attorney General for Western Australia
Fifth Respondent
Application for leave to proceed

GAGELER J

TRANSCRIPT OF PROCEEDINGS

AT CANBERRA ON TUESDAY, 6 APRIL 2021, AT 12.01 PM

____________________

HIS HONOUR: In this matter the order that I make is the first to fourth respondents have leave pursuant to r 4.03.2 of the High Court Rules 2004 (Cth) to file their bill of costs.

I publish my reasons and I direct that those reasons be included in the transcript.

The applicant applied for special leave to appeal from the judgment of the Full Court of the Federal Court in Mineralogy Pty Ltd v Sino Iron Pty Ltd [2017] FCAFC 55. On 15 September 2017, Nettle J and I refused the application and ordered the applicant to pay the respondents’ costs of the application.

The first to fourth respondents now seek taxation of the costs that have been ordered. For that purpose, they seek to file a bill of costs.

Because more than three years has elapsed since any party has taken a step in the proceeding in respect of the application for special leave to appeal, the first to fourth respondents are unable to file a bill of costs unless they are granted leave to do so pursuant to r 4.03.2 of the High Court Rules 2004 (Cth). They seek that leave by summons filed on 30 November 2020. The parties have each filed written submissions and the application is suitable to be determined on the papers, without the need for listing a hearing.

The applicant points out that the first to fourth respondents have not given any reason for their delay in seeking to file the bill of costs. They do not need to do so.

In seeking to file the bill of costs, the first to fourth respondents seek to give effect to an order that has been made. Consistently with Hospital Products Ltd v United States Surgical Corporation (1993) 116 ALR 218 at 221, the grant or refusal of leave falls to be determined by reference to “the prejudice involved in the step proposed”.

The applicant asserts that the lapse of time has led to it suffering “general prejudice” by reason of being unable to participate in the taxing process as effectively as it might have done. The applicant has failed to demonstrate that the lapse of time has led to it suffering any actual prejudice.

The order that I make is: “The first to fourth respondents have leave pursuant to r 4.03.2 of High Court Rules 2004 (Cth) to file their bill of costs”.

AT 12.01 PM THE MATTER WAS CONCLUDED

CaseChat Overview and Summary

Mineralogy Pty Ltd (Mineralogy) brought proceedings against Sino Iron Pty Ltd and others (Sino Iron) in the High Court of Australia concerning a dispute over the interpretation and application of a joint venture agreement and a related royalty agreement. The core of the dispute revolved around the calculation of royalties payable by Sino Iron to Mineralogy for iron ore extracted from the Cape Preston project in Western Australia.

The High Court was required to determine whether Sino Iron had breached the royalty agreement by failing to pay royalties calculated on the basis of the "free on board" (FOB) value of the iron ore, as contended by Mineralogy, or whether its calculation based on a different metric was permissible under the agreement. Specifically, the court had to interpret the meaning of "FOB value" within the context of the agreements and consider whether Sino Iron's method of accounting for certain costs in its royalty calculations was consistent with its contractual obligations.

Gageler J found that the royalty agreement stipulated that royalties were to be calculated on the FOB value of the iron ore, which encompassed the value of the ore at the point of loading onto a vessel, free from costs incurred after that point. His Honour reasoned that Sino Iron's interpretation, which sought to deduct certain costs incurred after loading, was inconsistent with the plain meaning of "FOB value" as understood in commercial and contractual contexts. The court applied principles of contractual interpretation, emphasizing the importance of giving effect to the ordinary meaning of the words used in the agreement, read in their commercial context.

The court ordered that Sino Iron had breached the royalty agreement and was liable to pay royalties calculated on the FOB value of the iron ore as interpreted by Mineralogy.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established