Phelps and Ors v Minister Administering the Water Management Act 2000

[2024] NSWLEC 29

Land and Environment Court

New South Wales

Medium Neutral Citation:

Phelps and Ors v Minister Administering the Water Management Act 2000 [2024] NSWLEC 29

Hearing dates:

04 March 2024

Date of orders:

05 March 2024

Decision date:

05 March 2024

Jurisdiction:

Class 4

Before:

Robson J

Decision:

See orders at [35]-[36]

Catchwords:

PRACTICE AND PROCEDURE — Notice of motion to amend summons — Where amendment not prejudicial to respondent — Notice of motion granted

Legislation Cited:

Civil Procedure Act 2005 (NSW)

Uniform Civil Procedure Rules 2005 (NSW)

Cases Cited:

Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175; [2009] HCA 27

Category:

Procedural rulings

Parties:

Jonathon Phelps (First Applicant)
Dale Smith (Second Applicant)
Richard Schwager (Third Applicant)
Minister Administering the Water Management Act 2000 (Respondent)

Representation:

Counsel:
S Prince SC with A Searle (Applicants)
H El-Hage SC with M Thompson (Respondent)

Solicitors:
HWL Ebsworth Lawyers (Applicants)
Department of Planning and Environment (Respondent)

File Number(s):

2023/00302716

Publication restriction:

Nil

Judgment

1. By summons filed 22 September 2023, Jonathon Phelps, Dale Smith, and Richard Swagger (collectively, the ‘applicants’) seek relief by way of judicial review of a decision made by the Minister administering the Water Management Act 2000 (NSW) (‘Minister’) on 22 June 2023 to make the Available Water Determination Order for Regulated River Water Sources 2023 (‘2023 decision’). The applicants are landholders who hold supplementary water access licences for the Lower Namoi Regulated River Water Source (‘Lower Namoi Water Source’) under the Water Sharing Plan for the Upper Namoi and Lower Namoi Regulated River Water Sources 2016 (‘Namoi WSP’).

2. By notice of motion filed 27 February 2024, and which proceeded before me as a matter of some urgency as Duty Judge yesterday, the applicants seek leave to amend their summons to include a further claim (as Ground 8) that the 2023 decision was infected by jurisdictional error related to a reasonable apprehension of bias.

Background

3. In order to understand and provide context for the parties’ detailed submissions, an understanding of the background facts of the matter is important. The following summary is uncontentious.

4. The summons raises seven (somewhat overlapping) grounds. Ground 1 is that the 2023 decision is invalid because in making the decision, the Minister’s delegate took into account an irrelevant consideration being the unapproved use of the Namoi Source Model (which is a hydrologic computer model).

5. Ground 2 is that the 2023 decision is invalid because in making the decision, the Minister’s delegate took into account an irrelevant consideration, being “floodplain harvesting”, in circumstances where floodplain harvesting and/or water from the floodplain should not have been taken into account.

6. Ground 3 is that the 2023 decision is invalid because in making the decision, the Minister’s delegate relied upon an invalid hydrologic computer model to assess the current extraction of water – this ground is pleaded as an alternative ground to Ground 1.

7. Ground 4 is that the 2023 decision is invalid because in making the decision, the Minister’s delegate relied upon the Namoi Source Model.

8. Ground 5 is that the 2023 decision is invalid because in making the decision, the Minister’s delegate constructively failed to exercise jurisdiction.

9. Ground 6 is that the 2023 decision is invalid because in making the decision, the Minister’s delegate failed to apply the proper statutory test.

10. Ground 7 is that the 2023 decision is invalid because in making the decision, the Minister’s delegate was otherwise attended by jurisdictional error.

11. The proceedings are listed for hearing on 8, 9 and 10 April 2024 before me.

Proposed amendment

12. The further ground raised in the proposed amended summons annexed to the notice of motion is headed “Ground 8: The decision to adopt the Namoi Source Model was infected by apprehended bias” and is pleaded as follows:

“73.   The Delegate’s decision to make the 2023 AWD was attended by jurisdictional error in that it exceeded the power conferred by section 59 of the WMA and/or failed to comply with the rules which the Delegate was required to apply under section 60 of the WMA because the decision was not free from a reasonable apprehension of bias in that the conduct by which the Delegate exercised his statutory power involved conduct such that a fair minded lay observer informed of the nature of the statutory procedure might reasonably apprehend that the Delegate did not bring an impartial and unprejudiced mind to the resolution of the legal and factual questions arising in the making of the decision in the circumstances.”

13. The particulars subjoined to proposed paragraph (73) provide that the Minister’s delegate relied upon an “anterior decision” by the Chief Knowledge Officer, “Mr Isaacs”, on 5 June 2023, to approve the Namoi Source Model. The allegation of apprehended bias is rooted in the allegation that Mr Isaacs was at the relevant time also a director of a company called eWater Limited that had developed the Namoi Source Model, which was the model adopted in the antecedent decision, and which was thereafter relied upon in the 2023 decision. And, that Mr Isaacs was aware of a reasonably perceived conflict of interest and that an independent review of the Namoi Source Model was required (and was not undertaken).

Evidence

14. In support of their motion, the applicants read the affidavit of John Philip Zorzetto of 27 February 2024. The Minister reads the affidavit of Stephanie Anne Willis of 1 March 2024.

15. In summary, the essential issue between the parties on the motion is whether the Court would accept the Minister’s position that the nature and importance of the proposed amendment to the summons is such that (given the preparation for the hearing on 8 to 10 April 2024 that has already been undertaken by the Minister) the Minister is materially prejudiced and is not in a position properly to meet the new argument.

16. The Minister maintains that if leave is granted, the Minister would seek vacation of the hearing dates as the Minister cannot meet both the timetable for the present preparation as well as meeting the new claim.

17. The further preparation that would be necessary if leave to amend is granted is detailed in Ms Willis’ affidavit of 1 March 2024. She sets out the names and availability of witnesses, both expert and lay, who will be required to be attended upon, and the nature and timing of the further preparation. She also sets out what she calls the “key events” in the proceedings to date in relation to the proposed amended summons. She notes that by email of 16 January 2024 the Minister was informed that the applicants would seek to amend the summons by raising an additional ground that the 2023 decision was affected by apprehended bias. And, that the Minister brought to the applicants’ attention that the proceedings were at an advanced stage, and that there would be insufficient time for the Minister to prepare. Ms Willis also notes that, having been informed on 16 January 2024 of the likely amendment, there were four occasions where the Minister requested confirmation of the proposed amendment – being, 31 January 2024, 2 February 2024, 8 February 2024 and 13 February 2024.

18. Despite these requests, the Minister did not receive correspondence enclosing the proposed amended summons until 23 February 2024 at around 5.34pm.

19. Ms Willis concludes that the Minister would not be able to attend to the new ground of review in the proposed amended summons as well as the normal preparation required for the hearing, including the finalisation of the court book and evidence book in the four weeks remaining until the commencement of the hearing.

20. Mr Zorzetto’s affidavit of 27 February 2024 sets out a history of the correspondence and dealings between the parties. He deals with the timing of the applicants’ receipt of knowledge and advice in relation to the proposed new ground. He deposes that it was not until 19 December 2023 that the applicants received advice from senior counsel, who having considered the further material produced by the Minister under a notice to produce, indicated there was a prospect of a claim based upon apprehended bias.

21. Mr Zorzetto indicates that it was only during the preparation of evidence that the applicants’ solicitors became aware of the possibility of the fact that the decision to approve the Namoi Source Model was, itself, infected by jurisdictional error because of an apprehension of bias on behalf of Mr Isaacs.

22. Mr Zorzetto states that the applicant therefore needed time to determine whether there was sufficient evidence, in order to support an additional ground, such that it was not until 13 February 2024 that the further material was produced by the Minister (consequent upon a second notice to produce), which included a declaration of a “conflict of duties” prepared by Mr Isaacs in relation to his role as a director of eWater Limited.

Submissions

23. The gravamen of the applicants’ submission is that it took some time for the Minister to produce documentation that triggered the applicants’ awareness of this potential new ground and thereafter, the applicants were concerned not to amend the summons until they were comfortable in relation to advice given and material available. The applicants point out that the Minister was aware of the claim well before the provision of the proposed amended summons, and as such, is clear from the applicants’ letter of the 29 January 2023.

24. The applicants submit that the Minister would not require the length of time suggested to attend to the relatively discrete matter now raised. The applicants further submit that the Minister’s concerns in relation to prejudice are overstated and that there is no real prejudice that would militate against the proposed amendment, and in the circumstance, there is no reason to vacate the hearing dates if the amendment is made.

25. The Minister raised four matters. First, the proposed amended summons raises an entirely new ground of review containing serious legal issues with potential implications for other water-sharing plans across the State. Second, the application was brought extremely late, being five months after the proceedings were commenced, and less than six weeks from the commencement of the hearing. Third, allowing the proposed amendment would be inconsistent with the overriding purpose of facilitating the just, quick and cheap resolution of the real issues in dispute, and the dictates of justice. And, fourth, if the Court was to grant leave to amend the summons, the Minister maintains that new hearing dates would be required to be set so that the new ground of review can be adequately prepared for and dealt with.

26. The Minister also submits that the fundamental facts underpinning the applicants’ new ground in the proposed amended summons would have been known upon reasonable investigation of publicly available information, which would have allowed the applicant to amend the claim some time ago.

Consideration

27. Taking into account the well-established principle that balancing the overriding purpose enunciated in both the Civil Procedure Act 2005 (NSW) and the Uniform Civil Procedure Rules 2005 (NSW) and the dictates of justice, whilst consideration must always depend upon the particular circumstances, generally, leave to amend should be granted if the application is made in a timely manner and for a proper purpose: Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175; [2009] HCA 27.

28. In considering the evidence and the submissions, there are four matters that I have taken into account in determining the applicants’ motion being, first, the nature and importance of the proposed amendment; second, the extent of the delay and the costs associated with the proposed amendment; third, (and importantly) in the current circumstances, the prejudice that might be assumed or is shown; and fourth, the explanation for delay in applying for leave to amend the summons.

29. Whilst acknowledging there is debate between the parties regarding the timely production of documents (and conscious of the Minister’s reluctance to produce certain documents at an earlier date based upon her view that the documents were not related to any claims pleaded), for the reasons that follow, I do not consider that, in the circumstances, the prejudice and inconvenience caused to the Minister (which I accept is material, and is not necessarily at the responsibility of the Minister) is sufficient to militate against leave being granted for the proposed amendment sought by the applicants.

30. Although the affidavit of Ms Willis articulates not insignificant prejudice, I find that some of the timeframes she has suggested that would be required for further preparation are unrealistic. Despite this, I accept that there may be delay in the consideration of the new ground and the marshalling of responsive evidence.

31. However, I consider that justice and fairness can be effected between the parties, because, being both Duty Judge dealing with this urgent application and Trial Judge, I am in the position to address any prejudice by allowing some indulgence, if it is needed, such that (whilst accepting that the Minister may not be able immediately to deal with the amendment despite her best endeavours), I consider that it is appropriate to allow the proposed amendment even though it may lead to the possible splitting of the hearing.

32. Overall, I find that it is appropriate to permit the amendment. To do otherwise would run the risk of depriving the applicants of pleading a matter that may relate to the final determination of the proceedings.

33. In these circumstances, if the hearing is unable to be completed in the time allocated, that is the three days in April already set down, some further hearing time for this aspect of the matter to be further considered at a later date will be allocated.

34. In summary, I find that the Minister’s concerns can be accommodated in my finding that if the Minister is unable, subject to her best endeavours, to deal with the new ground now pleaded, I would be in a position to allow some further time to be allocated after the hearing dates of 8 to 10 April 2024. Despite this, I am expecting, because of my (now) understanding of the background of the matter, that all issues will be able to be considered and determined, within the allocated hearing dates.

Orders

35. The orders of the Court are:

1. Leave is granted for the Applicants to rely upon the Amended Summons attached as Annexure “A” to the Notice of Motion filed 27 February 2024.

2. The parties are to provide Short Minutes of Order relating to the discrete preparation of the matters raised in Ground (8) in the Amended Summons within 7 days.

3. Costs are reserved.

36. The Court notes that:

1. The Court anticipates that all issues in dispute will be conducted within the allocated 3 hearing days however, would consider allocating some further hearing time if the matters raised in Ground 8 in the Amended Summons cannot be accommodated.

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Decision last updated: 02 April 2024