Mintech Resources Pty Ltd v Russell-Taylor

Case [2012] SASCFC 67

SUPREME COURT OF SOUTH AUSTRALIA

(Full Court)

MINTECH RESOURCES PTY LTD & ANOR v RUSSELL-TAYLOR & ANOR

[2012] SASCFC 67

Judgment of The Full Court

(The Honourable Justice White, The Honourable Justice Peek and The Honourable Justice Stanley)

8 June 2012

ADMINISTRATIVE LAW - JUDICIAL REVIEW - GROUNDS OF REVIEW - PROCEDURAL FAIRNESS - HEARING

APPEAL AND NEW TRIAL - APPEAL - GENERAL PRINCIPLES - INTERFERENCE WITH JUDGE'S FINDINGS OF FACT - FUNCTIONS OF APPELLATE COURT - IN GENERAL

The respondent sought judicial review of a decision by the Minister for Mineral Resources Development to grant mining exploration licences over certain areas to the appellants.  A Judge found that, by failing to consider the respondent's objections to the Department's proposed method of determining the grant of the licences, the Minister had failed to afford natural justice to the respondent and made orders in the nature of certioarari.

Whether appellants had been put on notice, or sufficiently on notice, that the Judge may grant judicial review on those grounds - whether the Judge had reached conclusions of fact which were not available on the evidence.

Held, allowing the appeal, setting aside the orders made by the Judge and substituting an order dimissing the application for judicial review:  non-compliance with the hearing rule had not been raised by the plaintiff, either by way of his pleading or in the course of the trial - the Judge had raised the issue in the course of final addresses but not so as to put the defendants sufficiently on notice that the application for judicial review may be determined adversely to them on that basis - the evidence before the Court was insufficient to found the inferences upon which the Judge's decision was based.

Mining Act 1971 (SA) Pt 5, referred to.
Williams v Australian Telecommunications Commission (1988) 52 SASR 215; Banque Commerciale SA (in liq) v Akhil Holdings Ltd (1990) 169 CLR 279; Stead v State Government Insurance Commission (1986) 161 CLR 141; Reg v Commonwealth Conciliation and Arbitration Commission; ex parte Angliss Group (1969) 122 CLR 546, discussed.
Heatley v Tasmanian Racing and Gaming Commission (1977) 137 CLR 487; FAI Insurances Ltd v Winneke (1982) 151 CLR 342; Gould v Mount Oxide Mines Ltd (in liq) (1916) 22 CLR 490; Betfair Pty Ltd v Racing New South Wales (2010) 189 FCR 356, considered.

MINTECH RESOURCES PTY LTD & ANOR v RUSSELL-TAYLOR & ANOR
[2012] SASCFC 67

MINTECH RESOURCES PTY LTD & ANOR v
RUSSELL-TAYLOR & ANOR

Full Court:  White, Peek and Stanley JJ

  1. WHITE J.             By Pt 5 of the Mining Act 1971 (SA), the Minister for Mineral Resources Development may grant exploration licences permitting the licensees to explore for minerals on defined mineral tenements. The grant of a licence can be valuable as, other than in limited circumstances, the holder of the licence has exclusive rights to explore for minerals on the land to which the licence relates and the right to apply for…

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AGLC
Mintech Resources Pty Ltd v Russell-Taylor [2012] SASCFC 67
Case
[2012] SASCFC 67
Decision Date

CaseChat Overview and Summary

This case concerned an appeal to the Full Court of the Supreme Court of South Australia by Mintech Resources Pty Ltd and others against a decision of a single judge. The dispute arose from applications for exploration licences following the cancellation and subsequent reinstatement of prior licences held by the "Goldus Group". Mr Russell-Taylor had lodged applications for exploration licences over areas previously held by the Goldus Group. The core of the dispute involved the method by which competing applications for these licences were to be determined, with Mr Russell-Taylor asserting a right to have his applications considered on a "first come, first served" basis.

The legal issues before the Full Court included whether the primary judge erred in finding that Mr Russell-Taylor had been denied procedural fairness in the "method decision" concerning the determination of competing exploration licence applications. Specifically, the court had to consider whether the delegate of the Minister, Dr Tyne, failed to afford Mr Russell-Taylor procedural fairness by not considering his solicitor's letter of 23 August 2007, which objected to a departure from the "first come, first served" principle. The court also had to determine whether, even if a denial of procedural fairness occurred, it would be futile to order a new hearing, considering the principles established in cases like *Stead v State Government Insurance Commission*.

The Full Court reasoned that the primary judge erred in concluding that Mr Russell-Taylor had been denied procedural fairness. The court found that the evidence adduced at trial did not establish that procedural fairness in the method decision was a live issue. Crucially, the court noted that Mr Russell-Taylor himself did not lead evidence from Dr Tyne on this specific point during the trial, nor did he pursue cross-examination of Dr Tyne in a manner that clearly indicated a claim of non-compliance with the hearing rule regarding his objections to the method of determination. The court applied the principle that the requirements of natural justice depend on the circumstances of the case and that an appellate court should not order a new trial if it would be futile.

The Full Court allowed the appeal. It determined that Mr Russell-Taylor was aware of the appeal hearing and had made a conscious decision not to participate, and therefore, the appeal proceeded in his absence. The court concluded that the appellants were not on notice that the method decision might be impugned on procedural fairness grounds, and consequently, they were themselves denied procedural fairness in that regard. The court found that the primary judge's finding of a denial of procedural fairness was not supported by the evidence presented at trial.

Orders

Orders of the court

Full text does not contain this section.

Background

Background to the litigation

In the circumstances just described, the Court was satisfied that Mr Russell‑Taylor was aware of the appeal hearing and had made a conscious decision not to participate. It determined that it was appropriate to proceed with the hearing of the appeal in his absence. Background Circumstances Mintech, Mawson and Goldus Pty Ltd (Goldus) had previously been granted exploration licences: EL 2799 to Mintech on 19 February 2001; EL 3060 to Mawson on 12 February 2003; and ELs 2822, 2823 and 2824 to Goldus on 17 July 2001. The Judge referred to these licensees collectively as the Goldus Group. It is convenient to do likewise although Mawson is not a subsidiary of Goldus and they do not form a group in the conventional sense. In December 2004, in circumstances which it is unnecessary to describe, a delegate of the Minister cancelled the exploration licences held by the Goldus Group. Mr Russell‑Taylor became aware of the cancellations and, on 29 December 2004, lodged two applications for exploration licences (ELA 924 and ELA 925) in respect of areas which were previously subject to the licences of the Goldus Group. Two days later, PepinNini Minerals Pty Ltd (PepinNini) lodged an application for an exploration licence for an area which partially overlapped Mr Russell‑Taylor’s ELA 924, the area of the previous Mintech licence, and the area of one of the previous Goldus licences. On 4 January 2005, another entity, Gladstone Resources Ltd (Gladstone) lodged an application for an exploration licence (ELA 002) for an area which partially overlapped Mr Russell‑Taylor’s ELA 925 and the area which was subject to the previous exploration licence of Mawson. However, PIRSA did not proceed to determine those applications at that time. This was because the Goldus Group had appealed to the Environment and Resources Development Court against the cancellation of their licences. The Acting Mining Registrar informed Mr Russell‑Taylor, PepinNini and Gladstone that she intended to defer the processing of their respective applications until the outcome of the appeals to the ERD Court was known. Subsequently, the Minister consented to orders by the ERD Court declaring void the cancellations of the exploration licences held by the Goldus Group and the Court made orders to that effect on 18 November 2005. In the meantime, the exploration licences of the Goldus Group had expired by reason of the absence of any application for their renewal. As I understand it, it was thought that the previous cancellations precluded any renewal of the licences and this explained the absence of renewal applications. It seems that there was some consideration given as to whether the previous licences should be reinstated following the orders made in the ERD Court. It is not necessary to record all the discussions and communications which occurred in that respect. Eventually, Dr Heithersay, the Executive Director of the Minerals, Energy and Resources Division of PIRSA, informed the Goldus Group that applications for exploration licences had to be lodged by 28 February 2007, after which PIRSA would proceed to determine all undecided applications. On 27 February 2007, Mawson lodged ELA 99 in respect of part of the area formerly covered by its previous exploration licence and Goldus lodged ELA 101 in respect of part of the area formerly covered by EL 2799 held by Mintech (later Mintech was substituted as the applicant for Goldus). On 2 March 2007, Goldus lodged ELA 116 in respect of part of the area formerly covered by its EL 2822.

Evidence

Evidence Before The Court

Mr Russell‑Taylor did not make any reference to a claim of non‑compliance with the hearing rule in the method decision during the course of his opening.The Evidence in the Trial The evidence adduced by both sides indicates that procedural fairness in the method decision was not a live issue in the trial. The most important evidence which could have been led on this topic would have been from the person who exercised the Minister’s delegated power of considering and determining the various applications, Dr Tyne. The State, which called Dr Tyne, did not lead any evidence from him about his or the Panel’s consideration of Mr Russell Taylor’s objection to its proposed method of determining the competing applications. Nor did Mr Russell-Taylor. In Mr Russell-Taylor’s cross-examination, he drew Dr Tyne’s attention to his solicitor’s letter of 23 August 2007, which was at pp 67 and 68 of a tender bundle. The following cross-examination then occurred:QAre you familiar with the documents on p 67 and p 68?AI would say that I’m not familiar with that. I vaguely recall the receipt of that letter, yes.QWas that considered at all through the Panel on 31 August?AMay I have an opportunity to just read it and see if it jogs my memory?QYes.AYes, I do, in general, recall. I don’t recall the details of the letter but I certainly recall the intent of the letter which is querying PIRSA’s implementation of a merit selection process of competing applications rather than … the expectation by the author that all applications be on first-come-first-served basis.QIndeed, I’m not here to sort of ask you about the intent of the letter so much as was the intent considered, considering the first letter we discussed, which was document 60, in relation to a very – I would say very brief exploration overview of only several paragraphs. In the light of the documents you have before you, 67 and 68, and the intent of the plaintiff, in his reluctance to participate in the Panel, in his belief that the matter [was] before the Warden’s Court or elsewhere, was his right to claim the leases outright, did you think the reluctance of the participant, being me, was such that it might have warranted further investigation …A… I do recall the letter and I do recall that the intent of the letter was discussed during the opening of the Panel. And the minutes of the Panel and the instruction in my position as the Chair, which is on the next page, p 69, just outlines the process of the Panel in relation to dealing with competing applications. So certainly I recall being shown your letter and this was certainly discussed in the mineral tenements area. I am not aware of whether legal advice was sought at that time.(Emphasis added) Apart from these questions Mr Russell-Taylor did not otherwise cross-examine Dr Tyne as to the consideration which had been given to his solicitor’s letter of 23 August 2007. Mr Russell-Taylor’s next questions concerned the Panel’s consideration of Mr Russell-Taylor’s reluctance to participate in a merits review and to provide information to the Panel. In this context, Mr Russell-Taylor’s questions could not reasonably have been understood at the time as cross-examination directed to a failure by Dr Tyne to consider his objections to the method of determination, Mr Russell-Taylor having not pursued the manner in which the Panel had considered his objections and the regard which had been had to those objections.

Decision

Reasons for decision

WHITE J PEEK J
Mr Russell‑Taylor’s principal complaint was that PIRSA was not permitted by the Mining Act to depart from the first come - first served basis of assessment or, alternatively, that he had a substantive entitlement arising from his legitimate expectation to have his applications determined on that basis. He was also concerned that his applications had not been considered on their merits. Mr Russell‑Taylor did assert that he had been denied procedural fairness, but his complaints in that respect related to the Panel having initially determined his applications without agreeing to receive the evidence of his financial capacity under conditions of confidentiality.The Judge’s Decision The Judge rejected Mr Russell‑Taylor’s claims that:1.the Minister had no power under the Mining Act to grant exploration licences on other than the first come - first served basis;2.his legitimate expectation that the Minister and the Department would process and grant licences on the first come - first served basis gave rise to a substantive entitlement to the grant of the exploration licences for which he had applied;3.the consent orders made by the ERD Court revoking the cancellation of the licences of the Goldus Group were beyond that Court’s jurisdiction.The Judge concluded that several of the “decisions” in respect of which Mr Russell‑Taylor sought certiorari were not amenable to that form of relief. However, the Judge considered that Mr Russell‑Taylor’s legitimate expectation that the Minister and the Department would grant exploration licences on a first come - first served basis gave rise to procedural entitlements. This finding was not controversial as the defendants accepted that Mr Russell‑Taylor did have such a legitimate expectation and also accepted that this gave rise to “natural justice rights”, as opposed to substantive rights. The Judge then went on to find that Mr Russell‑Taylor’s legitimate expectation meant that the Minister and the Department were obliged to provide him with the opportunity to submit material in support of his objection and to give proper consideration to his objection. In this respect, the Judge referred to passages in the judgments of Aickin J in Heatley v Tasmanian Racing and Gaming Commission[3] and in FAI Insurances Ltd v Winneke[4] to the effect that natural justice requires, not only an opportunity to the affected party to make submissions to the decision‑maker, but also that the decision‑maker consider those submissions. I will refer to this as “the hearing rule”. [3] (1977) 137 CLR 487 at 513-4, 516.[4] (1982) 151 CLR 342 at 383-4. The Judge held that Dr Tyne had made the method decision and had subsequently recommended the grant of licences to Mawson, Mintech and PepinNini without complying with the requirements of the hearing rule. This was because Dr Tyne had not considered the submission from Mr Russell‑Taylor’s solicitor dated 23 August 2007 that the Department should not depart from the first come - first served basis of assessment.Denial of Procedural Fairness

Ratio Decidendi

Legal Principle Established

Established by: WHITE J, PEEK J

In these circumstances, I consider that the appellants were not on notice that the method decision may be impugned on procedural fairness grounds. In this way they were themselves denied procedural fairness.Discretionary Considerations Of course, not every departure from the rules of procedural fairness at trial will entitle the aggrieved party to have the judgment set aside or a new hearing ordered. An appellate court will not do so if such a course would be futile. This means that it is sometimes necessary for an applicant to show that if it had been afforded procedural fairness the outcome may have been different. The High Court discussed this issue in Stead v State Government Insurance Commission[12] and said:For this reason not every departure from the rules of natural justice at a trial will entitle the aggrieved party to a new trial. By way of illustration, if all that happened at a trial was that a party was denied the opportunity of making submissions on a question of law, when, in the opinion of the appellate court, the question of law must clearly be answered unfavourably to the aggrieved party, it would be futile to order a new trial. … [W]hen the Full Court is invited by a respondent to exercise these powers in order to arrive at a conclusion that a new trial, sought to remedy a denial of natural justice is relevant to a finding of fact, could make no difference to the result already reached, it should proceed with caution. It is no easy task for a court of appeal to satisfy itself that what appears on its face to have been a denial of natural justice could have had no bearing on the outcome of the trial of an issue of fact. And this difficulty is magnified when the issue concerns the acceptance or rejection of the testimony of a witness at the trial.[13][12] (1986) 161 CLR 141.[13] Ibid at 145-6. The present appellants led no evidence on the appeal as to any further evidence which could have been led from Dr Tyne had they or the State been on notice at trial that compliance with the hearing rule in the method decision was in question. They contended that it was not necessary to do so. For the reasons which follow, I am satisfied that that contention should be upheld. The content of the hearing rule is not fixed. What is required depends upon the circumstances of the given case. In Reg v Commonwealth Conciliation and Arbitration Commission; ex parte Angliss Group,[14] the High Court said:But it must be borne in mind that these principles are not to be found in a fixed body of rules applicable inflexibly at all times and in all circumstances. Tucker LJ said in Russell v Duke of Norfolk: “The requirements of natural justice must depend on the circumstances of the case, the nature of the inquiry, the rules under which the tribunal is acting, the subject matter that is being dealt with, and so forth”. This passage was approved by the Privy Council in University of Ceylon v Fernando, and was used by Kitto J in Mobil Oil Australia Pty Ltd v Federal Commissioner of Taxation. There his Honour observed: “What the law requires in the discharge of a quasi-judicial function is judicial fairness … What is fair in a given situation depends upon the circumstances”. We agree with the forgoing statements of the relevant law.[15][14] (1969) 122 CLR 546.[15] Ibid at 552-3.