Sino Iron Pty Ltd v Mineralogy Pty Ltd [No 15]
[2023] WASC 56
•7 MARCH 2023
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA IN CIVIL CITATION : SINO IRON PTY LTD -v- MINERALOGY PTY LTD
[No 15] [2023] WASC 56
CORAM : KENNETH MARTIN J HEARD
: 33 HEARING DAYS BETWEEN 21 FEBRUARY
2022 - 29 APRIL 2022DELIVERED : 7 MARCH 2023 FILE NO/S
: CIV 1915 of 2019 MATTER
: CONSOLIDATED with CIV 2326 of 2021 by orders
dated 29 December 2021BETWEEN
: SINO IRON PTY LTD First Plaintiff
KOREAN STEEL PTY LTD
Second Plaintiff
CITIC LIMITED
Third Plaintiff
AND
MINERALOGY PTY LTD
First Defendant
CLIVE FREDERICK PALMER
Second Defendant
STATE OF WESTERN AUSTRALIA
Third Defendant
FILE NO/S : CIV 2326 of 2021
[2023] WASC 56
BETWEEN : SINO IRON PTY LTD First Plaintiff KOREAN STEEL PTY LTD Second Plaintiff CITIC LIMITED Third Plaintiff AND MINERALOGY PTY LTD First Defendant CLIVE FREDERICK PALMER Second Defendant THE STATE OF WESTERN AUSTRALIA Third Defendant Catchwords: Contract - Multiple Project Agreements between protagonists - State Agreement - Express terms - Implied terms of law and fact - Alleged breaches - Plaintiffs' request for extra tenure areas (for nil additional consideration) over statutory mining leases and general purpose leases held by first defendant to support continuation of established magnetite Project in Pilbara - Proposed Mine Continuation Proposal (MCP) for next phase of Project required to be approved by Minister under State Agreement as an 'additional proposal' - First defendant required by State Agreement to be a Co-Proponent of additional proposal to Minister - First defendant declines to sign or submit draft MCP as Co-Proponent with plaintiffs - Concern over additional tenure areas sought from first defendant under proposals as unreasonable, excessive or unnecessary - Rejection by first defendant of nil payment tenure acquisition request of plaintiffs - Obligation on Proponent parties under State Agreement to implement prior approved proposals and to ensure the continuous operation of the established Project
[2023] WASC 56
Equity - Relief - Plaintiffs seek mandatory final injunctive orders to compel first defendant to join with them and submit MCPs to Minister to consider and approve - Further orders sought on conditional basis (subject to notification and no action advice by Commonwealth Treasurer under Foreign Acquisition and Takeover Act 1975 (Cth)) to compel first defendant to agree to grant all requested extra tenure areas that plaintiffs nominate as being reasonably required for continuation of Project under MCPs
Estoppel - Additional causes of action to support like compulsive relief raised as conventional estoppel, estoppel by representation and statutory unconscionable conduct of first defendant - Second defendant said to be accessory and personally liable to alleged unconscionable conduct of first defendant
Evidence - Late 2021 pre-trial amendments reducing the scale of the additional tenure claims and scope of the extra tenure areas demanded from first defendant - Repercussions of late change - New (second) action of plaintiffs consolidated to first action - Whether the revised tenure claim a reasonable request to first defendant in the circumstances
Legislation:
Australian Securities and Investments Commission Act 2001 (Cth)
Competition and Consumer Act 2010 (Cth)
Environmental Protection Act 1986 (WA)
Evidence Act 1906 (WA)
Foreign Acquisitions and Takeovers Act 1975 (Cth)
Foreign Acquisitions and Takeovers Regulation 2015 (Cth)
Government Agreements Act 1979 (WA)
Interpretation Act 1984 (WA)Iron Ore Processing (Mineralogy Pty Ltd) Agreement Act 2002 (WA)
Iron Ore Processing (Mineralogy Pty Ltd) Agreement Amendment Act 2008
(WA)
Iron Ore Processing (Mineralogy Pty Ltd) Agreement Amendment Act 2020
(WA)
Mining Act 1978 (WA)
Supreme Court Act 1935 (WA)Trade Practices Act 1974 (Cth)
Result:
Plaintiffs' action dismissed, save in respect of Programme of Works (PoW) issue
[2023] WASC 56
Category: A
Representation:
CIV 1915 of 2019
Counsel:
First Plaintiff : J Karkar KC, S Parmenter KC, S Free SC, J Kirkwood, T Maxwell & K Dovey Second Plaintiff : J Karkar KC, S Parmenter KC, S Free SC, J Kirkwood, T Maxwell & K Dovey Third Plaintiff : J Karkar KC, S Parmenter KC, S Free KC, J Kirkwood, T Maxwell & K Dovey First Defendant : P Dunning KC, M Karam, K Byrne, H Cooper & D Fawcett Second Defendant : In person (by video link)
Third Defendant : A Sefton SC
Solicitors:
First Plaintiff : Herbert Smith Freehills Second Plaintiff : Herbert Smith Freehills Third Plaintiff : Herbert Smith Freehills First Defendant : Robinson Nielsen Legal Second Defendant : In person
Third Defendant : State Solicitor's Office
CIV 2326 of 2021
Counsel:
First Plaintiff : J Karkar KC, S Parmenter KC, S Free SC, J Kirkwood, T Maxwell & K Dovey Second Plaintiff : J Karkar KC, S Parmenter KC, S Free SC, J Kirkwood, T Maxwell & K Dovey Third Plaintiff : J Karkar KC, S Parmenter KC, S Free SC, J Kirkwood, T Maxwell & K Dovey First Defendant : P Dunning KC, M Karam, K Byrne, H Cooper & D Fawcett
[2023] WASC 56
Solicitors:
First Plaintiff : Herbert Smith Freehills Second Plaintiff : Herbert Smith Freehills Third Plaintiff : Herbert Smith Freehills First Defendant : Robinson Nielsen Legal Second Defendant : In person
Third Defendant : State Solicitor's Office
Cases referred to in decision:
Ali v Australian Competition and Consumer Commission [2021] FCAFC 109;
(2021) 394 ALR 227 Ansett Australia Grand Staff Superannuation Fund Pty Ltd v Ansett Australia Ltd
[2003] VSCA 117; (2003) 176 FLR 393
Ansett Transport Industries Operations (Pty Ltd) v Commonwealth [1977] HCA
71; (1977) 139 CLR 54
Arwon Finance Pty Ltd v Wilson [2019] WASC 244
Ashton v Pratt [2015] NSWCA 12; (2015) 88 NSWLR 281Australian Competition and Consumer Commission v CG Berbatis Holdings Pty
Ltd [2003] HCA 18; (2003) 214 CLR 51
Australian Competition and Consumer Commission v Geowash Pty Ltd [No 3]
[2019] FCA 72; (2019) 368 ALR 441 Australian Competition and Consumer Commission v Quantum Housing Group
Pty Ltd [2021] FCAFC 40; (2021) 285 FCR 133
Australian Security and Investment Commission v Kobelt [2019] HCA 18; (2019)
267 CLR 1
Bass v Permanent Trustee Company Ltd [1999] HCA 9; (1999) 198 CLR 334
Bell Group Ltd (in liq) v Westpac Banking Corporation [No 10] [2009] WASC
107; (2009) 39 WAR 1
Bell Group Ltd (in liq) v Westpac Banking Corporation [No 9] [2008] WASC
239; (2008) 39 WAR 1
Binningup Nominees Pty Ltd v Mirvac (WA) Pty Ltd [2021] WASCA 130
Black Box Control Pty Ltd v Terravision Pty Ltd [2016] WASCA 219
BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266
Cargill Australia Ltd v Viterra Malt Pty Ltd [No 28] [2022] VSC 13
CITIC Ltd v Mineralogy Pty Ltd [2020] WASC 223
CITIC Ltd v Mineralogy Pty Ltd [No 2] [2020] WASC 252
CITIC Ltd v Mineralogy Pty Ltd [No 3] [2020] WASC 398
CITIC Ltd v Mineralogy Pty Ltd [No 4] [2020] WASC 439
[2023] WASC 56
CITIC Ltd v Mineralogy Pty Ltd [No 5] [2021] WASC 89
CITIC Ltd v Mineralogy Pty Ltd [No 6] [2021] WASC 144
CITIC Ltd v Mineralogy Pty Ltd [No 7] [2021] WASC 371Codelfa Constructions Pty Ltd v State Rail Authority of New South Wales [1982]
HCA 24; (1982) 149 CLR 337
Commissioner of Taxation v Balasubramaniyan [2022] FCA 374
Con-Stan Industries of Australia Pty Ltd v Norwich Winterthur Insurance
(Australia) Ltd [1986] HCA 14; (1986) 160 CLR 226
Cordon Investments Pty Ltd v Lesdor Properties Pty Ltd [2012] NSWCA 184
CPB Contractors Pty Ltd v Rizzani De Eccher Australia Pty Ltd [2017] NSWSC
1798
Crown Melbourne Ltd v Cosmopolitan Hotel (Vic) Pty Ltd [2016] HCA 26;
(2016) 260 CLR 1
Diab v YUM! Restaurants Australia Pty Ltd [2016] FCA 43
EDWF Holdings 1 Pty Ltd v EDWF Holdings 2 Pty Ltd [2008] WASC 275
EDWF Holdings 1 Pty Ltd v EDWF Holdings 2 Pty Ltd [2010] WASCA 78;
(2010) 41 WAR 23
Electricity Generation Corporation v Woodside Energy Ltd [2014] HCA 7; (2014)
251 CLR 640
Fan v Tang [2010] NSWSC 11
FJ & PN Curran Pty Ltd v Almond Investors Land Pty Ltd [2019] VSCA 236
Forrest v Australian Securities and Investments Commission [2012] HCA 39;(2012) 247 CLR 486
Giumelli v Giumelli [1999] HCA 10; (1999) 196 CLR 101
Good Living Company Pty Ltd as trustee for the Warren Duncan Trust No 3 v
Kingsmede Pty Ltd [2021] FCAFC 33; (2021) 284 FCR 424
Grundt v Great Boulder Pty Gold Mines Ltd [1937] HCA 58; (1937) 59 CLR 641
Jones v Dunkel [1959] HCA 8; (1959) 101 CLR 298
Kebewar Pty Ltd v Harkin (1987) 9 NSWLR 738
KWS Capital Pty Ltd v Love [2015] WASCA 237
Li v So [2021] VSCA 32
Mackay v Dick (1881) 6 App. Cas. 251
Marmax Investments Pty Ltd v RPR Maintenance Pty Ltd [2015] FCAFC 127;(2015) 237 FCR 534
Menezes v Salmon [2009] NSWSC 2
Mineralogy Pty Ltd v Sino Iron Pty Ltd [2013] WASC 194
Mineralogy Pty Ltd v Sino Iron Pty Ltd [2017] FCAFC 55
Mineralogy Pty Ltd v Sino Iron Pty Ltd [2020] WASC 40
Mineralogy Pty Ltd v Sino Iron Pty Ltd [2021] WASC 45
Mineralogy Pty Ltd v Sino Iron Pty Ltd [2022] WASCA 162
Mineralogy Pty Ltd v Sino Iron Pty Ltd [2022] WASCA 26
Mineralogy Pty Ltd v Sino Iron Pty Ltd [No 13] [2016] WASC 403
[2023] WASC 56
Mineralogy Pty Ltd v Sino Iron Pty Ltd [No 16] [2017] WASC 340
Mineralogy Pty Ltd v Sino Iron Pty Ltd [No 17] [2018] WASC 8
Mineralogy Pty Ltd v Sino Iron Pty Ltd [No 2] [2021] WASCA 105Mineralogy Pty Ltd v Sino Iron Pty Ltd [No 6] [2015] FCA 825; (2015) 329 ALR
1
Mineralogy Pty Ltd v State of Western Australia [2004] WASC 275 Mineralogy Pty Ltd v State of Western Australia [2005] WASCA 69 Mineralogy Pty Ltd v Western Australia [2021] HCA 30; (2021) 95 ALJR 832;
(2021) 393 ALR 551 Monroe Topple & Associates Pty Ltd v Institute of Chartered Accountants in
Australia [2002] FCAFC 197; (2002) 122 FCR 110
Moratic Pty Ltd v Gordon [2007] NSWSC 5
Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd [2015] HCA 37;(2015) 256 CLR 104
Nelson v Walker [1910] HCA 27; (1910) 10 CLR 560
Paciocco v Australia and New Zealand Banking Group Ltd [2015] FCAFC 50;
(2015) 236 FCR 199
Pilbara Iron Ore Pty Ltd v Ammon [2020] WASCA 92
Re Michael; ex parte WMC Resources Ltd [2003] WASCA 288; (2003) 27 WAR
574
Realestate.com.au Pty Ltd v Hardingham [2022] HCA 39; (2022) 97 ALJR 40
Royal Botanic Gardens and The Domain Trust v South Sydney City Council
[2002] HCA 5; (2002) 240 CLR 45
S&C Nicola Pty Ltd v Peter Holmes Investment Pty Ltd [2022] NSWCA 72;
(2022) 108 NSWLR 165
Saleh v Romanous [2010] NSWCA 274; (2010) 79 NSWLR 453
Secured Income Real Estate (Aust) Ltd v St Martin's Investments Pty Ltd [1979]
HCA 51; (1979) 144 CLR 596
Servcorp WA Pty Ltd v Perron Investments Pty Ltd [2016] WASCA 79; (2016)
50 WAR 226
Shepherd v Felt & Textiles of Australia Ltd [1931] HCA 21; (1931) 45 CLR 359
Shirlaw v Southern Foundries (1926) Ltd [1939] 2 KB 206
Sidhu v Van Dyke [2014] HCA 19; (2014) 251 CLR 505
Sino Iron Pty Ltd v Mineralogy Pty Ltd [2019] FCA 675
Sino Iron Pty Ltd v Mineralogy Pty Ltd [2019] WASCA 80; (2019) 55 WAR 89
Sino Iron Pty Ltd v Mineralogy Pty Ltd [2020] HCATrans 10
Sino Iron Pty Ltd v Mineralogy Pty Ltd [2020] WASC 311
Sino Iron Pty Ltd v Mineralogy Pty Ltd [No 11] [2022] WASC 473
Sino Iron Pty Ltd v Mineralogy Pty Ltd [No 2] [2014] WASC 444
Sino Iron Pty Ltd v Mineralogy Pty Ltd [No 2] [2017] WASCA 76
Sino Iron Pty Ltd v Mineralogy Pty Ltd [No 2] [2021] WASC 170
Sino Iron Pty Ltd v Mineralogy Pty Ltd [No 4] [2021] WASC 451
[2023] WASC 56
Sino Iron Pty Ltd v Mineralogy Pty Ltd [No 5] [2021] WASC 473 Sino Iron Pty Ltd v Mineralogy Pty Ltd [No 6] [2021] WASC 475 Strzelecki Holdings Pty Ltd v Cable Sands Pty Ltd [2010] WASCA 222; (2010)
41 WAR 318
Swift Australian Co (Pty) Ltd v South Brisbane Insurance Co Ltd [1970] VR 368 TEC Desert v Commissioner of State Revenue [2010] HCA 49; (2010) CLR 576 Thompson v Palmer [1933] HCA 61; (1933) 49 CLR 507
Trans Petroleum (Australia) Pty Ltd v White Gum Petroleum Pty Ltd [2012]
WASCA 165; (2012) 268 FLR 433
Van Duren v Hammond & Roberts Pty Ltd [No 2] [2019] WASC 246
Vodafone Pacific Ltd v Mobile Innovations Ltd [2004] NSWCA 15
Waltons Stores (Interstate) v Maher [1988] HCA 7; (1988) 164 CLR 387Westgem Investments Pty Ltd v Commonwealth Bank of Australia [No 6] [2020]
WASC 302
Wilson v Arwon Finance Pty Ltd [2020] WASCA 137
Windsor Refrigeration Co Ltd v Branch Nominees Ltd [1961] Ch 375
[2023] WASC 56
KENNETH MARTIN J
Table of Contents
PART 1: OVERVIEW ..................................................................................................... 18
Introduction ......................................................................................................................... 18
Overview of the trial and the final injunctive relief sought against Mineralogy by the
plaintiffs ............................................................................................................................... 18 Core final mandatory injunctive relief sought against Mineralogy in the Primary Trial 20 approval ........................................................................................................................... 26
The MCPs and additional tenure prayers for relief by the CONSOC ............................. 23
The CITIC plaintiffs' pleaded MCP relief ................................................................... 28
Mineralogy's resistance to the CITIC plaintiffs' pleaded MCP relief.......................... 32
Second injunctive relief component: the extra tenure areas to be compelled from
Mineralogy envisaged by and underlying the 2017 MCPs.............................................. 34
No relief granted at large ............................................................................................. 37
Navigating the trial evidence ............................................................................................... 38
Electronic trial ................................................................................................................. 38
An aerial view of the Pilbara Sino Iron Project location ................................................. 39
Trial book and exhibits .................................................................................................... 41
The agreed trial chronology (exhibit T) .......................................................................... 45
Bibliography/dramatis personae (aide-mémoire 16) ....................................................... 47
Trial pleadings ................................................................................................................. 48
Written submissions ........................................................................................................ 48Cross-referencing to source exhibits ............................................................................... 48
Early geographical orientations: seven (7) maps ................................................................. 49
6FAD map ....................................................................................................................... 49
CONSOC Annexure 4 map ............................................................................................. 51
CONSOC Annexure 11 map ........................................................................................... 54
CONSOC Annexure 11A map ........................................................................................ 56
CONSOC Annexure 11B map ......................................................................................... 59
2017 MCPs Appendix B Plan 2 map ............................................................................... 622017 MCPs Appendix F map .......................................................................................... 64
PART 2: NAVIGATIONAL AIDS ................................................................................. 66
Focal points of these reasons ............................................................................................... 66
Some relatively uncontroversial facts assembled ................................................................ 73
The December 2017 MCPs ............................................................................................. 83
More facts around the CITIC plaintiffs' claim and litigation .......................................... 87
Matters of clarification ........................................................................................................ 92
[2023] WASC 56
KENNETH MARTIN J
MRSLA terminology: Site Lease Area (SLA) ................................................................ 92
Ancient history?: a mere two billion tonne Sino Iron Project ......................................... 94
Poor communications between the protagonists ............................................................. 98Rival perspectives as to commerciality ......................................................................... 100
Extra tenure for the Sino Iron Project: The CPMM communication of 29 March 2018 by
Mr Chen Zeng (exhibit 1598) ............................................................................................ 104
Further observations on the Annexure 11A tenure map introduced at 26 October 2021 by
the ASOC ........................................................................................................................... 114
Evaluation of the effect of 11 documents referred to under the particulars to particular147B of the CONSOC ....................................................................................................... 119
A 29 November 2021 HSF request to Mineralogy ........................................................ 121
Mineralogy's resistance stance: an overview ................................................................. 124
Further tenure areas 'reasonably required' and for 'no additional monetary consideration'
........................................................................................................................................... 126
The extra tenure areas required by the CITIC plaintiffs ................................................ 131
Exhibit J: maps and photographs ................................................................................... 133
Exhibit J: map 2 ......................................................................................................... 133
Exhibit J: maps 20 and 38 (extra tenure areas assumed for the MCPs) .................... 136Map 13: further comparisons (extra tenure areas needed) ........................................ 141
Tenure summary ............................................................................................................ 143
PART 3: THE CONTRACTUAL FOCUS ................................................................... 145
Overview: the breach of contract case .............................................................................. 145
The CITIC plaintiffs' pleaded breach of contract case against Mineralogy ...................... 146CONSOC 'Tenure Terms' and 'Tenure Performance Terms' ............................................. 150
CONSOC par 153: Tenure Terms ................................................................................ 151
CONSOC par 151: the Tenure Term plea .................................................................... 152
Some observations on CONSOC par 151 ................................................................. 156
CONSOC par 153: Tenure Terms revisited ................................................................. 156
Comments on CONSOC pars 151 and 153 ................................................................... 156
CONSOC par 168: breach of the Tenure Terms ........................................................... 157CONSOC par 154: Tenure Performance Terms ........................................................... 158
Observations on CONSOC par 152 ........................................................................... 159
Observations on CONSOC par 169 ........................................................................... 161
A good faith MRSLA obligation applied .......................................................................... 161 request to Mineralogy ........................................................................................................ 163
[2023] WASC 56
KENNETH MARTIN J
Past exercises in the interpretation of Sino Iron and Korean Steel and CITIC Sino Iron
Project documents in this Court including Sino Iron and Korean Steel MRSLAs:
interpretive principles ........................................................................................................ 164
Uncontroversial principles of law: contractual interpretation .......................................... 168
The express contractual obligation of mutual good faith under cl 37.4 in each MRSLA . 172First aspect of Secured Income: implied term by law of mutual cooperation in commercial
contracts ............................................................................................................................. 182 The CITIC plaintiffs' contract obligation and breach case ................................................ 188
Contractual terms nomenclature ........................................................................................ 192
The further necessary tenure request ............................................................................. 192
Subset areas ................................................................................................................... 194A 2017 tenure request in 2021 ....................................................................................... 195
Revisiting the CONSOC contract breaches of 'Tenure Terms' and 'Tenure Performance
Terms' ................................................................................................................................ 198
The CITIC plaintiffs' express contractual terms relied upon (sources) ............................. 200The Sino Iron and Korean Steel MRSLAs ........................................................................ 203
MRSLA Recital E .......................................................................................................... 206
Observations upon Recital E in each MRSLA .............................................................. 208
The express MRSLA good faith promise ...................................................................... 210An ad hoc MRSLA implied term? ..................................................................................... 212 Extrinsic facts and interpretation: interpreting contractual obligations and contended ad hoc implied terms of fact by reference to identified surrounding circumstances .................... 213
Eight (8) pieces of extrinsic evidence evaluated ........................................................... 213
No such ad hoc implied terms are found in the MRSLAs ................................................. 219
Conclusions: express contract terms - an extra tenure provision obligation in Mineralogy
........................................................................................................................................... 226
Conclusions: content of express good faith MRSLA term ............................................... 229
Contract case conclusions: a contractual obligation by reference to the terms of the SinoIron and Korean Steel MRSLAs ........................................................................................ 234
PART 4: WIDER INPUTS ............................................................................................ 239
Three further and alternate causes of action: unpleaded common law (mis)representation
and statutory misleading and deceptive conduct cases the plaintiffs are not pursuing
(CONSOC pars 62 - 130) .................................................................................................. 239
Changes towards the scope of the required additional tenure in late 2021: tenure areas
requested of Mineralogy for the purposes of a trial determination ................................... 241
CONSOC par 200A unconscionable conduct tied to the Annexure 11B map tenure request
of 29 November 2021 ........................................................................................................ 247The State Agreement ......................................................................................................... 250
Proposals - clauses 6, 7 and 8 ........................................................................................ 251
[2023] WASC 56
KENNETH MARTIN J
Consideration of proposals ........................................................................................ 252
Additional proposals .................................................................................................. 253
'Readiness' requirement and conditions precedent .................................................... 253'Implementation' and 'Continuous operation' obligations .......................................... 254
Paramountcy - cl 28 ....................................................................................................... 255
GA Act and principles of contractual interpretation/statutory interpretation ................. 256Other relevant provisions............................................................................................... 258
Prior 'approved proposals' under the State Agreement ...................................................... 260
PART 5: TRIAL WITNESS EVIDENCE .................................................................... 270
Trial evidence .................................................................................................................... 270
The CITIC plaintiffs' attempts to engage with the defendants in relation to the 2016 and
2017 MCPs and addback tenure areas ............................................................................... 270Observations on passing communications over the 2016 and 2017 MCPs and additional tenure ............................................................................................................................. 287
Overview of the CITIC witnesses' evidence at trial .......................................................... 293
Overview of the CITIC plaintiffs' other witnesses (Mr Tonkin and Mr Netterfield) ........ 303
The CITIC plaintiffs' mining lease areas extra tenure considerations under the evidence of
Mr Goodwin ...................................................................................................................... 309
The instructions by HSF to Professor Williams ................................................................ 310
The evidence of Mr Goodwin and expert evidence of Professor Williams (continued):
focus as to extra tenure sought for further TSFs ............................................................... 335Mr Robert Goodwin .......................................................................................................... 341
Mr Goodwin's evidence-in -chief .................................................................................. 341
Mr Goodwin's cross-examination .................................................................................. 346
Day 1 of Mr Goodwin's cross-examination ............................................................... 346
Day 2 of Mr Goodwin's cross-examination ............................................................... 356Further questioning of Mr Goodwin .......................................................................... 362
Conclusion observations on Mr Goodwin's evidence ................................................... 379
Professor David Williams .................................................................................................. 380
Concluding observations on Professor Williams' evidence ........................................... 382
The extra areas of tenure sought for TSF and WRDs........................................................ 383
So-called 'Wedge' area ................................................................................................... 384
So-called 'Crescent' area ................................................................................................ 385Areas within G08/63 ...................................................................................................... 386
The evidence of Mr Tonkin and expert evidence of Mr Netterfield: Cape Preston shoreside
Port areas, increased stockpile capacity ............................................................................ 387
Cape Preston Port expansion: the 2017 MCPs ................................................................. 394
Mr Michael Tonkin ............................................................................................................ 404
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KENNETH MARTIN J
Mr Tonkin's evidence-in-chief ...................................................................................... 404
Further evidence-in-chief by Mr Tonkin ....................................................................... 413
The Sino Iron Terminal Facility ................................................................................ 414
The Sino Iron Terminal Stockyard ............................................................................ 415
Mr Tonkin's concluding evidence-in-chief and cross-examination ............................... 424
Mr David Netterfield ......................................................................................................... 432
Mr Netterfield's evidence-in-chief ................................................................................. 432
Mr Netterfield's cross-examination ............................................................................... 453
Day 1 of Mr Netterfield's cross-examination ............................................................ 453
Day 2 of Mr Netterfield's cross-examination ............................................................ 463
Concluding Mr Netterfield's cross-examination ............................................................ 481
Observations .............................................................................................................. 483
PART 6: ESTOPPELS ................................................................................................... 488
Estoppels as stand-alone causes of action ......................................................................... 488
Estoppel by convention ................................................................................................. 493
Estoppel by representation and conduct ........................................................................ 498
PART 7: 'REASONABLE EXPECTATIONS' ............................................................ 509
The Common Thread: alternative subsidiary causes of action of the CITIC plaintiffs: estoppel by convention, estoppel by representation and conduct, and statutory unconscionable conduct contrary to s 21 of the ACL ....................................................... 509 Observations on CONSOC par 131: 'Reasonable Expectations' ...................................... 514 Observations on CONSOC par 131(b): no more additional consideration to Mineralogy for extra tenure ........................................................................................................................ 515 CONSOC pars 62-30: source(s) of no additional monetary consideration to Mineralogy so as to generate such a 'Reasonable Expectation' ................................................................. 519
First subcomponent (m): MRSLA amendments and the 2008 GAMD ........................ 525
Evaluation of subcomponent (m) .............................................................................. 527
Second subcomponent (g): no more money to Mineralogy ......................................... 531
Evaluation of subcomponent (g) ............................................................................... 532 Third subcomponent (e): Mineralogy representations regarding access to sufficient land for no additional monetary consideration, and application for titles, in the Preston Area
....................................................................................................................................... 534
Evaluation of subcomponent (e) ................................................................................ 535
Fourth subcomponent (i): no more money to Mineralogy for extra tenure areas ........ 539
Fifth subcomponent (j): no payment to Mineralogy ..................................................... 541
Evaluation of subcomponent (j) ................................................................................ 546
Comments on subcomponent (j) ................................................................................ 547
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Concluding assessments regarding the CITIC plaintiffs' no additional monetary payment to
Mineralogy for additional tenure stance ............................................................................ 551
The CONSOC par 131 expectations: not proved .......................................................... 551
PART 8: STATUTORY UNCONSCIONABLE CONDUCT ..................................... 556
Statutory unconscionable conduct: s 21(1) of the ACL .................................................... 556
Statutory unconscionable conduct: general observations ................................................. 560
The express CONSOC invocations of s 21 of the ACL .................................................... 563
Case law ............................................................................................................................. 566Analysis and conclusions .................................................................................................. 570
PART 9: SEVEN SUNDRY CONCLUDING ISSUES ............................................... 578
Sundry issue 1: second aspect of Secured Income - unreasonable refusals...................... 578
Sundry issue 2: the Wedge area lying within the southern half of Mineralogy's G08/53 at
the west side of that general purpose lease ........................................................................ 586Sundry issue 3: the FATA, FATR and FIRB regime ......................................................... 591
Key provisions of the FATA ......................................................................................... 592
Mineralogy's FATA defence pleas and the CITIC plaintiffs' responses ....................... 600
Conclusions on rival submissions so far ....................................................................... 608
Mineralogy's further FATA defence pleas and the CITIC plaintiffs' responses ........... 609Mr Palmer's submissions on FATA ............................................................................... 613
Sundry issue 4: repurposing of Mineralogy's General Purpose Lease
Tenements - mandatory relief ordering Mineralogy's conditional surrender and reissue by
way of repurposing of Mineralogy's currently held G08/53, G08/54 and G08/63 ............ 615
Sundry issue 5: the Programme of Works (PoW) ............................................................ 621
Sundry issue 6: intrusions into the north-south infrastructure corridor under what is sought
as additional tenure and in the 2017 MCPs ....................................................................... 625Sundry issue 7: the so-called 'Fulcrum Purposes' ............................................................. 627
PART 10: CONCLUSIONS ........................................................................................... 631
Summary of major conclusions ......................................................................................... 631
Orders ................................................................................................................................ 637
PART 11: SCHEDULES ................................................................................................ 638
Schedule 1 - Final Exhibit List .......................................................................................... 638
Schedule 2 - Introduction to the Chronology .................................................................... 667
Component A ................................................................................................................. 670
Component B ................................................................................................................. 714Component C ................................................................................................................. 824
Schedule 3 - Dramatis Personae ........................................................................................ 827
Schedule 4A - Further Papers for the Judge (Pleadings) ................................................... 831
Schedule 4B - Written Submissions of Parties .................................................................. 832
[2023] WASC 56
KENNETH MARTIN J
Schedule 5 - Consolidated Extracts from the Sino Iron MRSLA (as amended) at 8 January
20008 ................................................................................................................................. 833Schedule 6 - Primary Trial Questions and Answers .......................................................... 846
The Court's question 3(i) ............................................................................................... 846
Response by CITIC plaintiffs to question 3(i)........................................................... 846
Mineralogy's response to question 3(i) ...................................................................... 847
The Court's question 3(ii) .............................................................................................. 848
CITIC plaintiffs' response to question 3(ii) ............................................................... 848
Mineralogy's response to question 3(ii) ..................................................................... 848
The Court's question 3(iii) ............................................................................................. 849
CITIC plaintiffs' response to question 3(iii) .............................................................. 849
Mineralogy's response to question 3(iii) .................................................................... 849State's response to question 3(iii) .............................................................................. 850
The Court's question 4 ................................................................................................... 853
CITIC plaintiffs' response to question 4 .................................................................... 853
Mineralogy's response to question 4 .......................................................................... 853
The Court's question 5 ................................................................................................... 853
CITIC plaintiffs' response to question 5 .................................................................... 854
Mineralogy's response to question 5 .......................................................................... 855
Court's question 6 .......................................................................................................... 855
CITIC plaintiffs' response to question 6 .................................................................... 855
Mineralogy's response to question 6 .......................................................................... 861
The Court's question 7 ................................................................................................... 861
CITIC plaintiffs' response to question 7 .................................................................... 862
Mineralogy's response to question 7 .......................................................................... 866
The Court's question 8 ................................................................................................... 866
CITIC plaintiffs' response to question 8 .................................................................... 867
Mineralogy's response to question 8 .......................................................................... 867
The Court's question 9(a) ............................................................................................... 867
CITIC plaintiffs' response to question 9(a) ............................................................... 867
Mineralogy's response to question 9(a) ..................................................................... 869
The Court's question 9(b) .............................................................................................. 869
CITIC plaintiffs' response to question 9(b) ............................................................... 869
Mineralogy's response to question 9(b) ..................................................................... 869
The Court's question 10 ................................................................................................. 869
CITIC plaintiffs' response to question 10 .................................................................. 869
Mineralogy's response to question 10 ........................................................................ 870
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The Court's question 11 ................................................................................................. 870
CITIC plaintiffs' response to question 11 .................................................................. 870
Mineralogy's response to question 11 ........................................................................ 871
The Court's question 12 ................................................................................................. 871
CITIC plaintiffs' response to question 12 .................................................................. 871
Mineralogy's response to question 12 ........................................................................ 872
The Court's question 13 ................................................................................................. 872
CITIC plaintiffs' response to question 13 .................................................................. 872
Mineralogy's response to question 13 ........................................................................ 873
The Court's question 14 ................................................................................................. 873
CITIC plaintiffs' response to question 14 .................................................................. 873
Mineralogy's response to question 14 ........................................................................ 874State's response to question 14 .................................................................................. 876
The Court's question 15 ................................................................................................. 880
CITIC plaintiffs' response to question 15 .................................................................. 880
Mineralogy's response to question 15 ........................................................................ 880
The Court's question 16 ................................................................................................. 881
CITIC plaintiffs' response to question 16 .................................................................. 881
Mineralogy's response to question 16 ........................................................................ 883
The Court's question 17 ................................................................................................. 883
CITIC plaintiffs' response to question 17(a) ............................................................. 883
Mineralogy's response to question 17(a) ................................................................... 885
The Court's question 17(b) ............................................................................................ 885
CITIC plaintiffs' response to question 17(b) ............................................................. 885
Mineralogy's response to question 17(b) ................................................................... 886
The Court's question 17(c) ............................................................................................. 886
CITIC plaintiffs' response to question 17(c) ............................................................. 886
Mineralogy's response to question 17(c) ................................................................... 886
The Court's question 17(d) ............................................................................................ 886
CITIC plaintiffs' response to question 17(d) ............................................................. 886
Mineralogy's response to question 17(d) ................................................................... 887
The Court's question 18(a) ............................................................................................. 891
CITIC plaintiffs' response to question 18(a) ............................................................. 891
Mineralogy's response to question 18(a) ................................................................... 892
The Court's question 18(b) ............................................................................................ 892
CITIC plaintiffs' response to question 18(b) ............................................................. 892
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Mineralogy's response to question 18(b) ................................................................... 892
The Court's question 18(c) ............................................................................................. 892
CITIC plaintiffs' response to question 18(c) ............................................................. 892
Mineralogy's response to question 18(c) ................................................................... 893
The Court's question 19(i) ............................................................................................. 893
CITIC plaintiffs' response to question 19(i) .............................................................. 893
Mineralogy's response to question 19(i) .................................................................... 893
The Court's question 19(ii) ............................................................................................ 895
CITIC plaintiffs' response to question 19(ii) ............................................................. 895
Mineralogy's response to question 19(ii) ................................................................... 898
The Court's question 20(a) ............................................................................................. 898
CITIC plaintiffs' response to question 20(a) ............................................................. 898
Mineralogy's response to question 20(a) ................................................................... 898
The Court's question 20(b) ............................................................................................ 898
The CITIC plaintiffs' response to question 20(b) ...................................................... 899
Mineralogy's response to question 20(b) ................................................................... 900
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KENNETH MARTIN J:
PART 1: OVERVIEW
Introduction
1 These reasons are the aftermath of another of the litigation battles between the same parties that have raged in this forum now for over a decade.
2 As their litigation wars continue, a verse from Macbeth resonates:
I'll fight till from my bones my flesh be hacked.
3 This 'battle' in a seemingly never-ending civil litigation war is fought between the proponents of the project conducted upon certain of Mineralogy's many mining tenements located in the Pilbara of Western Australia and out of the local port of Cape Preston ('Sino Iron Project').
4 Notwithstanding protracted litigation battles in this and in other superior Australian courts between these parties since 2013, the Sino Iron Project has now been operational for almost a decade as a magnetite concentrate producer and exporter to Chinese steel makers.
5 But a 'fog of war' that has prevailed for too long between the Sino Iron Project parties has seen them all behave towards each other in surprisingly uncommercial ways over time. By that mutually hostile conduct they now expose to some jeopardy the health of a precious project goose - that has laid golden eggs for many.
Overview of the trial and the final injunctive relief sought against
Mineralogy by the plaintiffs6 This trial of two subsequently consolidated civil actions (at 29 December 2021) proceeded across 33 days of February, March and April 2022.
7 The trial sees three corporate plaintiffs ('Sino Iron', 'Korean Steel' and their ultimate controlling Hong Kong based parent foreign corporation 'CITIC' - collectively the 'CITIC plaintiffs') move this Court to issue (amongst other relief) final, mandatory compulsive conduct injunctions directed at the first defendant ('Mineralogy') - primarily grounded on Mineralogy's alleged breaches of contract(s) that relate to the Sino Iron Project in the Pilbara of Western Australia. In these reasons
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I refer to the CITIC plaintiffs and Mineralogy from time to time as the
'protagonist parties'.8 Other questions addressing possible damages or compensation relief for the CITIC plaintiffs in the actions - have been, in effect, deferred to be separated away from this first component trial (which I refer to as the 'Primary Trial') - to be dealt with later, if required.
9 To that separation end, my pre-trial case management directions of 23 June 2021 had ordered (direction 11):
Pursuant to order 32 rule 4 of the Rules of the Supreme Court 1971 (WA), the following question, namely the quantification of any loss or damage suffered by the plaintiffs, being the subject of paragraph 204 of the SOC, and the quantification of any damages or compensation, being the subject of paragraphs E, F, G and H of the prayer for relief in the SOC is hereby separated and is removed - to be tried separately, if necessary, subsequent to a determination by trial of all other issues in the proceeding at a first trial session (the Primary Trial).
10 The terms of the mandatory injunctive final relief that the CITIC plaintiffs ask the Court to grant against Mineralogy, are pivotal as well as insightful. I explain why that is below.
11 Another notable feature of the Primary Trial is that personal relief is also sought against the second defendant, Mr Clive Palmer. Relief is pursued against Mr Palmer on a basis that he is said to be an accessory to the allegedly infringing statutory conduct of Mineralogy. That alleged exposure of Mr Palmer is not said to be in contract. Rather, it is on an alternative basis to contract by a contended cause of action against Mineralogy allegedly arising as statutory unconscionable conduct, contrary to s 21 of the Australian Consumer Law ('ACL') found as within sch 2 to the Competition and Consumer Act 2010 (Cth).
12 Hence, conduct as an accessory to the allegedly unconscionable conduct of Mineralogy, is said to rise to Mr Palmer's personal liability in statutory compensation or damages to the CITIC plaintiffs, as a second defendant.
13 The alternative statutory unconscionable conduct cause of action raised against the defendants did not receive a heavy degree of focus during the Primary Trial. In truth, it presented as something of a 'poor relation', or a relative afterthought - in the overall scheme of the CITIC plaintiffs' major contract-focused arguments advanced during the Primary Trial. A prioritisation of those claims for common law breach of
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contract relief against Mineralogy, as I will venture to explain by these
reasons, was highly understandable.14 No injunctive relief is sought against Mr Palmer within the Primary Trial. But what is sought to be established therein is Mr Palmer's personal liability as an accessory to conduct of Mineralogy - on the alternative statutory cause of action that is grounded on alleged unconscionable conduct by Mineralogy.
15 Needless to say, both Mineralogy and Mr Palmer resolutely resist all claims raised against them by the CITIC plaintiffs in these proceedings.
16 Whilst Mineralogy was represented by senior counsel and by four junior counsel at the Primary Trial, Mr Palmer chose instead to represent himself. He appeared, by leave and via video link from time to time, in limited aspects of the Primary Trial.
17 Because its interests are or may be affected by the relief sought, the State of Western Australia (the 'State') is a third defendant in this litigation within the two now consolidated actions - albeit no relief is sought against the State.
Core final mandatory injunctive relief sought against Mineralogy in the
Primary Trial18 I now seek to identify at an early stage what are the two fundamental and related injunction relief issue compulsive order components - to be discerned in the final mandatory injunctive relief orders sought by the CITIC plaintiffs against Mineralogy.
19 Those two key relief order components concern, first, compulsive order relief sought against Mineralogy to force it to advance two so-called Mine Continuation Proposals ('MCPs') which have been prepared by Sino Iron and Korean Steel (see respectively, exhibits 1688 and 1689) - by orders of the Court compelling Mineralogy to join Sino Iron and Korean Steel in their submission for their consideration and desired approval by the relevant State Minister ('Minister') under the State agreement regime applicable to the Sino Iron Project: see the Iron Ore Processing (Mineralogy Pty Ltd) Agreement (as amended in 2008) ('State Agreement') found as within sch 1 and sch 2 to the Iron Ore Processing (Mineralogy Pty Ltd) Agreement Act 2002 (WA) ('State Agreement Act').
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20 Second are further affirmative order injunctions that would compel Mineralogy to provide to Sino Iron and Korean Steel certain requested areas of additional tenure sought (but for no payment to Mineralogy) from out of Mineralogy's currently held 'Area A' mining tenements (as identified by the State Agreement), which extra areas are all located proximate to the existing territory used in the Sino Iron Project - where it has now been established in the Pilbara of Western Australia for some years.
21 For introductory purposes, I need also to mention that the asserted legal foundation for the compulsive final mandatory injunctive relief orders being sought against Mineralogy in the Primary Trial are grounded alternatively on four (4) distinctly raised causes of action, all separately pleaded and relied upon by the CITIC plaintiffs, and directed against Mineralogy.
22 Two of those four (4) causes of action advanced by the CITIC plaintiffs have already been mentioned, namely the claim to common law breach of contract-based relief, then alternatively, for relief grounded on alleged statutory unconscionable conduct by Mineralogy (invoking s 21 of the ACL).
23 The common law breach of contract platform for injunctive relief against Mineralogy is pleaded to arise out of unmet obligations by Mineralogy under various written contracts (more particularly from alleged contractual breaches by Mineralogy against various express or implied contractual terms - found within various written agreements) and all perfected some years ago now (ie, between 2006 and 2008) as between one or other, or all, of the CITIC plaintiffs as written agreements made with Mineralogy concerning different aspects of the Sino Iron Project ('Project Agreements'). There is also a claim for an alleged breach by Mineralogy of aspects of the State Agreement to which it is a party along with Sino Iron and Korean Steel.
24 Alternatively, the same final injunctive relief is also pursued by the CITIC plaintiffs by their invocations of additionally pleaded causes of action said to be grounded on the alleged inducing conduct of Mineralogy and said to give rise to estoppels against Mineralogy favouring the CITIC plaintiffs - raised as two further stand-alone and independent causes of action seeking to support the same final injunctive relief as is sought by contract or by statute against Mineralogy - towards compelling it to both advance the two MCPs to the Minister, and as well
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to agree to grant the additional tenure areas sought of it to Sino Iron and
Korean Steel.25 The two stand-alone causes of action said to be founded upon estoppels, are both run in the alternative, additionally against Mineralogy - advanced first, as either a so-termed representational or conduct based estoppel, but as well, by a cause of action claimed as being grounded on a suggested (common law) conventional estoppel. Albeit always unstated, the first estoppel reliant on Mineralogy's alleged conduct or representations looks to be of the genre of an equitable promissory estoppel. Whether the law of Australia has yet developed to a point of recognising that such an equitable estoppel will sustain a stand-alone cause of action, is an unresolved question. Use of a common law estoppel by convention to found a stand-alone cause of action is also a rarely encountered phenomenon.
26 The fourth alternative cause of action against Mineralogy and Mr Palmer, as earlier mentioned, is founded on the alleged statutory unconscionable conduct of Mineralogy - as an alleged contravention against s 21 of the ACL.
27 Necessarily, I elaborate later upon all four (4) of these alternatively invoked causes of action at discrete parts of the ensuing reasons.
28 Presently, however, it is enough at an early stage to observe that the focus of the protagonist parties' written submissions and within the verbal opening and closing addresses by their respective senior counsel at the Primary Trial, was heavily directed at the contract breach action as it is advanced by the CITIC plaintiffs. That was understandably so, as will emerge.
29 Apart from under contract, the three (3) other causes of action, as suggested alternatives towards the same equitable compulsive end relief, whilst conceptually arguable, all display, as I seek to explain, multiple self-evident conceptual and practical obstacles - upon acknowledging the protagonist parties' careful and densely documented Sino Iron Project Agreement contractual relationship - under the multiple written agreements that came to be put in place across 2006 - 2008 to found the Sino Iron Project - and which saw in the end a perfection and entry of multiple fully executed written contracts (Project Agreements) all recording at length what presents therein as an elaborately bargained for and then settled upon written catalogue of carefully assembled obligations.
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30 Invariably those Project Agreements also record explicitly, in effect, that they contain the entirety of what the parties agreed upon and had set down at the end within the four corners of the text of those executed agreements.
31 In early 2022, at the time of the Primary Trial, these long term multiple written Sino Iron Project related Project Agreements all remain afoot (ie, their ongoing mutual performance obligations not to date having been put to an end, ie, that is lawfully terminated as to their ongoing performances as between the parties). So, these multiple written Project Agreements all continue on in force under an overarching umbrella of the State Agreement that is given effect to by legislation of the Parliament of Western Australia.
32 The CITIC plaintiffs, particularly the parent corporation CITIC, present as well - resourced corporate heavyweights. They enjoy access to what looks to be almost limitless legal resources - both internal and external. Mineralogy, the first defendant, also presents as handsomely resourced, although it is not yet of the international corporate 'goliath' stature of CITIC.
33 As I will endeavour to explain by these reasons, the primary trial's understandable focus was upon the CITIC plaintiffs' common law breach of contract cause of action directed against Mineralogy and to the equitable relief that is sought to provide outside common law damages, appropriate remedies out of the ancillary jurisdiction of a court of equity in such circumstances; see generally Meagher RP, Heydon JD and Leeming MJ, Meagher, Gummow & Lehane's Equity: Doctrine and Remedies (5th ed, 2015) [21-035].
34 As I will also seek to explain, if the emphasised common law breach of contract case advanced by the CITIC plaintiffs does not succeed against Mineralogy, then all else will essentially be lost, as well.
The MCPs and additional tenure prayers for relief by the CONSOC
35 The two key objects of the compulsive mandatory injunctive relief as pursued by the CITIC plaintiffs against Mineralogy - first, towards advancing the two currently moribund MCPs of 18 December 2017 and second then, to an obtaining from Mineralogy of the additional tenure tenement areas sought - are inseparably related. As advanced in the Primary Trial, the two objects invariably go hand in hand.
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36 The extra tenure areas being compulsorily sought from Mineralogy by the CITIC plaintiffs are all said to be needed, in effect, to sustain a proposed implementation of the MCPs - with the MCPs being given first to Mineralogy to accept and then to be submitted by it as a 'Co-Proponent' (as identified by the State Agreement) to the Minister, for those MCPs to then be considered by the Minister and hopefully approved, under the State Agreement, as 'additional proposals' (a term not defined by the State Agreement but see cl 8 of the State Agreement) for the Sino Iron Project. It was put to Mineralogy, in effect, by the CITIC plaintiffs at the time that without Sino Iron and Korean Steel obtaining all of the extra tenure areas as were sought from Mineralogy, that the as-drawn and presented MCPs could not be implemented.
37 The dual features (MCP and extra tenure area) of the injunctive relief sought at the Primary Trial also illustrate how differently the protagonist parties approach this dispute - from directly opposite starting perspectives.
38 For the CITIC plaintiffs, the invariable commencing platform is with the two 2017 MCP documents as prepared on behalf of Sino Iron and Korean Steel - then provided to Mineralogy for it to accept and to submit as a Co-Proponent for ministerial approval. These were holistic package proposals that the CITIC plaintiffs say Mineralogy was bound, in effect, to unconditionally accept. And beyond that, Mineralogy must, they contend, then submit those two MCPs in a final form at least as a Co-Proponent (with Sino Iron and Korean Steel) to the Minister for consideration and approval - so as thereby to ensure, it is put, the continuous operation of the Sino Iron Project - as is required under cl 6(7) of the State Agreement.
39 It needs to be clarified at an early point that there was no particular statutory status attaching to the written MCP documents which the CITIC plaintiffs' agent, CITIC Pacific Mining Management Pty Ltd ('CPMM'), despatched to Mineralogy for its proposed acceptance in 2016 and 2017 - to be known from then as either the 2016 or 2017 MCPs, respectively. In fact, what Mineralogy had received at the time, in reality, were only draft proposals - that Mineralogy was being asked, in effect, to agree to as a package, adopt for itself and then send on as a Co-Proponent to the Minister for consideration towards their approvals. The 2017 MCPs in fact display on their respective face pages the watermark of the word 'Draft'.
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40 For the first defendant, Mineralogy, its starting perspective is different. Mineralogy's negative MCP stance is invariably seen expressed as being focused at the underlying MCPs' assumed utilisation of the extra tenement tenure areas being provided from Mineralogy - for future use by Sino Iron and Korean Steel (as inherently assumed additional tenure utilisation features of the MCPs) and for no greater payment offered to Mineralogy in return for obtaining the extra tenure areas by the CITIC plaintiffs.
41 Mineralogy says fundamentally, that absent its prior agreement to all the extra tenure areas being obtained from it, it does not need to agree to grant any, let alone all, such MCP-utilised additional tenure mining tenement areas being provided - that are implicitly sought of it as a fundamental feature underlying the MCP documents it has received - or at least, not without some negotiated payment being made to it to obtain the extra tenure areas - assumed as utilised by Sino Iron and Korean Steel under the MCPs presented to Mineralogy for advancement to the Minister.
42 Hence, Mineralogy's base resistance position invariably, is that until all the extra tenure acquisition assumptions that underlie the MCPs as drawn up and were presented to it as a package - to accept and submit - are, in effect, properly addressed and resolved to its satisfaction by consensus - that Mineralogy is not legally obliged to do anything more towards advancing what are the current, imperfectly premised MCPs, to the Minister for executive consideration and approval. That is the in-principle impasse.
43 To submit the MCPs as a Co-Proponent to the Minister as they currently are drawn would be, says Mineralogy, in effect, to fall into a trap. That conduct by it would, under the State Agreement, effectively, from then, contractually bind Mineralogy to the State, to provide all those extra tenure areas assumed as used under the submitted contents of the MCPs, by Sino Iron and Korean Steel. This, says Mineralogy, is, in effect, all presumptuous and premature towards the additional MCP tenure areas - until some prior consensual basis for their commercial acquisitions from Mineralogy, is settled upon by agreement - rather than peremptorily assumed, as currently manifested within the MCPs as drawn.
44 Returning, however, to the two key relief components in the final mandatory injunctive relief orders being sought, their content may now be exposed in more detail.
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45 First to be noticed are the compulsive prayer A injunctive orders sought under the CITIC plaintiffs' consolidated further re-amended statement of claim ('CONSOC') of 30 December 2021 (folio 397 pages 3 - 213) - to compel Mineralogy forthwith and jointly with Sino Iron and Korean Steel, to submit what are the as-prepared Sino Iron and Korean Steel 2017 MCPs to the Minister for consideration and approval under the State Agreements as additional proposals.
46 As with too much of the CITIC plaintiffs' CONSOC pleading, I need to 'unpack' later in the reasons the elements of that first injunctive relief component (prayer A).
47 Second, however, are the related CONSOC final injunctive tenure relief orders - mandating the compulsory acquisition by Sino Iron and Korean Steel from Mineralogy of designated extra tenure areas - from out of Mineralogy's proximately held mining tenements held within Area A. The claimed extra tenure acquisition injunctive final relief are exemplified under the orders sought by prayers B and BA in the CONSOC.
48 This related affirmative order tenure conduct (ie, mandatory final injunction) seeks to compel Mineralogy to forthwith take steps towards it agreeing to grant to Sino Iron and Korean Steel all the additional tenure areas as are shown marked on various tenure maps that are found annexed to the CONSOC (relevantly, tenure area maps which are found as Annexures 11A and 11B to the CONSOC).
49 I move next to expose in some greater detail the first component injunctive order relief sought towards compelling Mineralogy to advance the 2017 MCPs.
First injunctive relief component: agree and submit the 2017 MCPs to the
Minister for approval50 The CONSOC observed prayer A injunctive relief has remained unaltered in formulation, since the 2018 commencement of this litigation by the CITIC plaintiffs. Commencement began out of the Western Australian division of the Federal Court of Australia ('Federal Court'), in October 2018. Later in 2019, there followed a transfer and a remitting of the action across to this Court - ordered under the national cross-vesting regime laws. To that end, I refer to the 17 May 2019 orders and reasons of Banks-Smith J, Sino Iron Pty Ltd v Mineralogy Pty Ltd [2019] FCA 675.
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51 Within this Court the as-remitted action of the CITIC plaintiffs came to be received, at 23 May 2019. It was then reclassified and renumbered, as action CIV 1915 of 2019.
52 The first aspect of the final injunctive relief sought are orders to compel Mineralogy to submit the 2017 MCPs of Sino Iron and Korean Steel to the Minister for approval(s) as additional proposals, under the State Agreement.
53 The State Agreement is found within schs 1 and 2 of the State Agreement Act as amended. It came to be further amended in 2020 in controversial circumstances, which eventually reached the High Court of Australia ('High Court'): see Mineralogy Pty Ltd v Western Australia [2021] HCA 30; (2021) 95 ALJR 832; (2021) 393 ALR 551.
54 The State and Mineralogy are parties to the State Agreement (referred to therein as 'the Company'). So too are many other corporate entities referred to in sch 1, as proponents, including Sino Iron and Korean Steel (but note: not their eventual corporate parent, CITIC).
55 Under the regime of the State Agreement, provision is made for a proponent to seek and obtain a ministerial approval for a submitted proposal, or for additional later proposal(s). Upon obtaining the requested ministerial approval, an as-submitted proposal would then attain the elevated status as an 'approved proposal' (as identified by the State Agreement), in regard to the particular 'Project'.
56 The State Agreement envisages, for its context of long-term mining project arrangements, that subsequently submitted proposals that would effect changes of 'significance' to the Sino Iron Project, be considered for executive approval as additional proposals (see State Agreement cl 7(6)). A discrete component of the reasons discusses various other aspects of the State Agreement.
57 To date there already exists a series of approved proposals' which have received executive approvals towards the Sino Iron Project, under this State Agreement. There are five such approved proposals - the last approved of which was the second Korean Steel Concentrate Proposal of November 2009. Again a discrete component of the reasons will discuss aspects of those earlier approved proposals. None of this is at all controversial, factually.
58 The Primary Trial is concerned with the, to date, wholly frustrated commercial objectives of Sino Iron and Korean Steel, in seeking to
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obtain further Sino Iron Project approvals under the State Agreement for the two written instruments I earlier introduced as being their proposed further MCPs from the relevant Minister under the State Agreement Act. It was, and is still sought by them to have the Minister first consider and then (hopefully) to approve in due course the two prepared (December 2017) MCPs received by Mineralogy (showing therein plans as proposed to advance the Sino Iron Project into the future respectively, for each of Sino Iron and Korean Steel, and essentially, as MCP documents drawn in almost identical counterpart terms for each of Sino Iron and Korean Steel) as envisaged further approved proposals for the Sino Iron Project - all under the regime of the State Agreement.
59 But the currently immovable obstacle against progressing either of these 2017 MCPs to even reach the Minister for their potential consideration, so as to be potentially approved as additional proposals under the State Agreement - is Mineralogy's steadfast refusal to accept their contents and progress them.
60 Under the terms of the State Agreement Mineralogy must, by the terms of the State Agreement, be a party to the submitting of these MCPs at least as a Co-Proponent, jointly with Sino Iron and Korean Steel for each MCP. Currently, there is no way to circumvent this essential requirement of the State Agreement mandating Mineralogy's participation. That need is accepted on all sides as a matter of law during this Primary Trial.
61 That was and remains the position of, in effect, the MCP inertia - since December 2017 concerning the as-drawn 2017 MCPs, provided then to Mineralogy (watermarked 'Draft' in each case).
The CITIC plaintiffs' pleaded MCP relief
62 The precise terms of the MCP final injunctive relief pressed for by the CITIC plaintiffs against Mineralogy under their CONSOC prayer A, has not altered since this litigation began in the Federal Court, in October 2018.
63 As pressed, CONSOC prayer A seeks orders of the Court (against Mineralogy) being:
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A. Orders for specific performance, alternatively injunctions under s 232 of the ACL, alternatively orders under ss 237 and 243 of the ACL, alternatively injunctions under the general law, requiring Mineralogy to, forthwith
(a) jointly with Sino Iron, submit the 2017 Sino Iron MCP to the SA Minister for approval under the State Agreement; and (b) jointly with Korean Steel, submit the 2017 Korean Steel MCP to the SA Minister for approval under the State Agreement.
64 The two (2) 2017 MCP instruments to which prayer A of the CITIC plaintiffs' CONSOC is directed, are the as proposed (to Mineralogy) MCP written instruments of 18 December 2017 watermarked as 'Draft' (see exhibits 1688 and 1689). Those documents came to be provided to Mineralogy on behalf of Sino Iron and Korean Steel at that time by the CITIC plaintiffs' agent, CPMM, another wholly controlled CITIC subsidiary - albeit that corporation is not a party in the present litigation. The reference to 'specific performance' as observed in prayer A is inaccurate terminology. I discussed this in an earlier strike out application (see Sino Iron Pty Ltd v Mineralogy Pty Ltd [2020] WASC 311 [76] - [82]). As I state at [79] of those reasons, the equitable remedy being pursued is an injunction: [79].
65 No MCP instrument has yet been agreed upon by Mineralogy to be provided to the Minister for executive consideration. The two December 2017 draft MCP instruments of Sino Iron and Korean Steel look to have been provided to Mineralogy by CPMM on a global basis - to accept and then submit to the Minister as a Co-Proponent for approval. There looks to have been no suggestion then, put to Mineralogy as to a possible negotiation over the content of these MCP instruments as received then, or their possible amendment in any respect, prior to a requested submission of them to the Minister.
66 It looks to have been presumed by CPMM that Mineralogy would accept and adopt for itself the received MCPs, then submit them as a Co-Proponent, effectively unaltered, to the Minister for evaluation - in order for them to be accepted, once approved, to become additional proposals for the Sino Iron Project - under the regime of the State Agreement.
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67 The 2017 MCPs thus present as being drawn as global 'package' proposals as provided then to Mineralogy, without invitation in December 2017, to debate or negotiate over their content.
68 But as foreshadowed, some of the underlying additional tenure areas which the 2017 MCPs as so drawn would utilise in the future in the Sino Iron Project, are areas that were not then a subject of Mineralogy's earlier Project Agreement grants to Sino Iron and Korean Steel. Some areas were additional tenure areas for MCP proposed uses within the Sino Iron Project. Absent reaching a consensus over Mineralogy providing these additional tenure areas, it does not take great commercial insight to see that these additional tenure acquisition assumptions seen underlying both 2017 MCP instruments as they had been given to Mineralogy to advance to the Minister - were likely to lead to disputation - as has proven the case.
69 As a matter of history, the draft December 2017 MCPs provided to Mineralogy had been preceded by earlier 2016 MCP iterations - sent then to Mineralogy about a year earlier, also by CPMM on behalf of the CITIC plaintiffs and to the same ends. They also had effectively gone nowhere, for like reason.
70 The proposed 2016 MCPs prepared on behalf of Sino Iron and Korean Steel, albeit still canvassed in the CONSOC - are now only relied on in the Primary Trial for background (see CONSOC pars 132 - 134). No relief is being sought by reference to those earlier 2016 MCPs. They came, in effect, to be wholly overtaken by the as revised December 2017 MCPs presented to Mineralogy.
71 Removal of a former par 16.7(a) from out of the original statement of claim under pleading amendments effected by the CITIC plaintiffs' amended statement of claim ('ASOC') of 27 October 2021 (folio 259), as from that time effected a 2016 MCP reliance excision as to any relief sought in the action by regard to those earlier, overtaken 2016 MCPs.
72 Both the 2016 and draft 2017 MCPs for Sino Iron and Korean Steel had been given to Mineralogy by CPMM on behalf of Sino Iron and Korean Steel, along with an accompanying request made to Mineralogy (by CPMM made as agent on behalf of Sino Iron, Korean Steel and CITIC) that Mineralogy, in effect, approve and finalise each MCP instrument, and then, proceed to submit them as a Co-Proponent to the Minister for consideration and approval - on a basis those MCPs would be joint MCPs submitted by Mineralogy as a Co-Proponent (as the case
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• Specifically in relation to the North-South Access Corridor, the 2017 MCPs stated, at page 13: "With respect to potential impacts upon shared services, the mine pit development and related infrastructure have been planned to ensure that the third party access corridor located on the eastern boundary of mining leases M08/123, M08/124 and M08/125 has been maintained. The only interactions with this corridor relate to the requirement to install haul roads that connect these mining tenements with the adjacent general purpose leases to the east (G08/54 and G08/63). These haul road interfaces will be designed in a similar way to existing haul roads that intersect this third party access corridor. These haul road crossovers will be designed to allow for future third party use along this corridor. Appendix B shows the conceptual layout for continued operations including the mine pit."
Mineralogy's response to question 17(d)
Port landslide
•
Commencing at the port, each of Annexures 11, 11A and 11B provides for an extension of the Site Lease Area that intrudes eastwards into the North South Access Corridor. Consistently with the fact that the North South Access Corridor is not visually depicted anywhere in the 2017 MCPs, the 2017 MCPs were silent on how the proposed expanded stockyard as illustrated in the drawing at page .8144 in Appendix D of the 2017 MCPs (Ex 1688, the Sino Iron 2017 MCP) interfaced with the North South Access Corridor.
•
It is only when one views the drawing on page .8144 in combination with Ex 1945 (an aerial photograph dated 18 January 2022) of the landside of the port that overlays the drawing) that it appears that the extended Site Lease Area depicted in Annexure 11B is limited to the boundaries of the proposed expanded dead stack area and the proposed expanded southern stockpile area (the extended Site Lease Area depicted in Annexures 11 and 11A is not so limited).
•
The map on page .8137 of the Sino Iron 2017 MCP contains a notation directed to the port landside area that states, "Additional Port Stockpile Infrastructure, Temporary Construction Areas,
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Surface Water Management". However, there is no specific identification of the areas in the map that constitute the "Temporary Construction Areas".
• The drawing on page .8144 showed a "3rd party access corridor" in yellow with a width varying between 105m (northern end) and 95m (southern end). Section 6.2.2 of the 2017 MCPs (page .8126) states:37 The proposed stockyard layout and supporting conveyors and roads will continue to provide third party access to an infrastructure corridor located on the eastern side of the existing stockyard facilities (refer Appendix D).
• The drawing also contained a note stating: Note: The stockyard layout is indicative only and will be subject to further detailed design. With the exception of the existing and proposed conveyor crossovers, no permanent stockyard infrastructure will be located within the third party access corridor described or outside the boundary described above.
•
There is no elaboration in the 2017 MCPs of what was entailed by "third party access". Based on Ex 1945, it appears that the "third party access corridor" is in complete substitution for the North South Access Corridor of 250m width depicted in the General Arrangement Map. Again, this is not clear merely by reference to the 2017 MCPs.
Port export terminal facility accommodation village
• Going down to the proposed export terminal facility accommodation village, each of Annexures 11, 11A and 11B provides for an extension of the Site Lease Area connecting the village to the North South Access Road (thereby necessarily intruding into the North South Access Corridor). The 2017 MCPs are silent on the effect of the extension of Site Lease Area on the use of the North South Access Corridor, or the justification for it. Section 7 of the 2017 MCPs (page .8128) contemplates that the village will also include associated infrastructure, such as: o permanent overhead power,
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o water pipelines; and
o road access from the North South Access Road, to the village.
•
However, section 7 does not purport to explain why Sino Iron and Korean Steel have sought an extension of the Site Lease Area into the North South Access Corridor, given that the infrastructure of the kind mentioned above is already located in the North South Access Corridor, which is not inhibited by the current Site Lease Area.
Port Northern Infrastructure Corridor
• Each of Annexures 11, 11A and 11B contain a similar intrusion with respect to the proposed Northern Infrastructure Corridor inasmuch as they seek an extension of the Site Lease Area up to the eastern edge of the North South Access Road. Section 8.1 (page .8129) provides that in addition to connecting the airstrip: It is considered that this corridor will also provide a suitable point for third party proponents to gain access to the lands within Area A (general purpose lease G08/74) to the east of the Sino Iron Project.
In the event that the infrastructure corridor to the airstrip does not provide any benefit to future development within general purpose lease G08/74, Sino Iron and Korean Steel will work with third party proponents to consider modifications to this tenure.
Proposed Northern TSF
•
Travelling down to the proposed Northern TSF, each of Annexures 11, 11A and 11B seek extensions of the Site Lease Area up to the eastern edge to the North South Access Road. Although it is not identified in any map or plan in the 2017 MCPs, it seems that these correlate with the location for proposed haul roads. There is nothing in the 2017 MCPs that illuminates justification for, or the effect of, these intrusions into the North South Access Corridor. To the extent that the plaintiffs refer to section 5.1 of the 2017 MCPs, that section is addressed below but, in any event, section 5.1 referred to the crossings between
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M08/123 – 125 and G08/54 and G08/63 (page .8119), rather than
the intrusions along G08/53.
Mine pit area
• Finally, each of Annexures 11, 11A and 11B provides for an extension of the Site Lease Area in a manner that crosses the North South Access Corridor between M08/123 – 125 and G08/54 and
G08/63.One of the crossings (between the top of M08/123 and G08/54) encompasses the existing haul road to the TSF, which has been used without incident by CPM to present date.
• Section 5.1 of the 2017 MCPs suggests that these crossings are for the installation of haul roads between the mining leases and the general purpose leases (page .8119): With respect to potential impacts upon shared services, the mine pit development and related infrastructure have been planned to ensure that the third party access corridor located on the eastern boundary of mining leases M08/123, M08/124 and M08/125 has been maintained. The only interactions with this corridor relate to the requirement to install haul roads that connect these mining tenements with the adjacent general purpose leases to the east (G08/64 and G08/63). These haul road interfaces will be designed in a similar way to existing haul roads that intersect this third party access corridor. These haul road crossovers will be designed to allow for future third party use along this corridor. Appendix B shows the conceptual layout for continued operations including the mine pit.
•
There is no explanation in the above passage (or anywhere else in the 2017 MCPs) for why Sino Iron and Korean Steel have sought Site Lease Area over these haul roads, which is mystifying in circumstances where the current Site Lease Area does not encompass the existing haul road to the TSF. Mr Netterfield, whom was taken carefully through the relevant provisions of the MRSLAs, thought that this "seem[ed] a little strange." Likewise, there is no elaboration (above or elsewhere) of the proposed "future third party use", the need for which is acute in circumstances where Mineralogy has been requested to grant Site Lease Area over these crossings of the North South Access Corridor.
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Southern infrastructure corridor
•
In each of Annexures 11, 11A and 11B, Sino Iron and Korean Steel seek an extension of the Site Lease Area between the northern parts of M08/124 and G08/63. (Curiously, Annexure 11 also provides for an extension of the Site Lease Area between the southern part of M08/123 and L08/20, for which there is no explanation.) It is not clear from the 2017 MCPs whether this crossing is for one of the proposed haul roads, is solely for the proposed Southern Infrastructure Corridor, or is for both of these things. To the extent that it for one of the proposed haul roads, the observations above apply. To the extent that it is solely for the proposed Southern Infrastructure Corridor, section 8.2 (page .8129) is silent on why Sino Iron and Korean Steel would require an extension of the Site Lease Area in contrast to (for example) their current lesser rights to use L08/20.
•
It was clear from Mr Netterfield's evidence that he had read and understood the 2017 MCPs thoroughly. Mr Netterfield could not discern from them the reason for seeking an extension of the Site Lease Area that bisected the North South Access Corridor. Of course, the authors of the 2017 MCPs and the related requests for additional tenure could have clarified these matters in evidence, but the plaintiffs chose not to call them
The Court's question 18(a)
23 (a) By reference to CONSOC prayer for relief B seen as framed by reference to a map that is Annexure 11A to the pleading and the plea under CONSOC par 147 (at 26 October 2021 by the ASOC filed by leave that day) - do the CITIC plaintiffs press for orders for extra tenure relief in terms of areas seen as outlined in blue under annexure 11A as Site Lease Area (see prayer Ba.) and within the meaning of cl 1.1 and cl 4.1 of each of the Sino Iron and Korean Steel MRSLAs?
CITIC plaintiffs' response to question 18(a)
•
For the purpose of this proceeding, the plaintiffs would be content for the Court to grant tenure in terms of prayer for relief BA(a), whether that outcome is reached directly by prayer for relief BA(a) itself, or indirectly by way of prayer for relief B(b) which is the alternative prayer for relief based on Annexure 11A.
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Mineralogy's response to question 18(a)
•
This is a question for the plaintiffs. Mineralogy will address the question once the plaintiffs' answer is provided.
The Court's question 18(b)
24 (b) Is relief pressed for under prayer B in light of the fact that the area seen as shaded in blue on Annexure 11A on the land side of the Cape Preston port area, does not as shaded distinguish as between claimed Site Lease Area so identified - by contrast to a claim for temporary areas in respect of which merely some lesser degree of access or licence over some of the blue area is sought - viewed by reference to a distinction implemented in a subsequent CONSOC annexure map 11B - where that distinction is implemented by reference in that map to darker blue shaded areas on the landward side of the port in respect of which merely a licence for access and use is sought under the terminology of prayer for relief BA(a.11.)?
CITIC plaintiffs' response to question 18(b)
•
The answer to question 18(a) in paragraph 58 above applies equally here.
Mineralogy's response to question 18(b)
•
This is a question for the plaintiffs. Mineralogy will address the question once the plaintiffs' answer is provided.
The Court's question 18(c)
25 (c) In other words, is a case for relief under prayer B framed by reference to a grant of exclusive possession as Site Lease Area pressed for by reference to the Annexure 11A map - and if so, how is it then to be contended that third party access over multi-user access corridors at the Cape Preston stock yard areas are not impeded, given that it is also contended that a differentiation as would be implemented under the map that is CONSOC annexure 11B would preserve the third party access corridors at the port area?
CITIC plaintiffs' response to question 18(c)
•
The answer to question 18(a) in paragraph 58 above applies equally here.
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Mineralogy's response to question 18(c)
•
This is a question for the plaintiffs. Mineralogy will address the question once the plaintiffs' answer is provided.
The Court's question 19(i)
26 19 Towards the relief as sought by the CITIC plaintiffs by reference to their further alleged causes of action grounded in estoppel and upon the as contended 'Reasonable Expectations' (par 191 of the CONSOC) or further and alternatively, under an estoppel by convention:
(i)
Are the plaintiffs seeking to invoke the distinct genre of proprietary estoppel as a cause of action to obtain proprietary rights over the extra tenure areas - as the relief seem [sic] claimed under prayers for relief par B, alternatively under prayer BA?
CITIC plaintiffs' response to question 19(i)
•
As to question 19(i), the plaintiffs do not advance a claim of proprietary estoppel.
Mineralogy's response to question 19(i)
• Equitable estoppel as a cause of action. The plaintiffs, to the extent they seek to advance an equitable estoppel claim, have not addressed the threshold conceptual obstacle to that relief. A claim for relief, such as the plaintiffs', whereby such an estoppel is used as a cause of action, is precluded by authority binding on this Court. • There is no High Court decision where such relief has ever been granted or approved. As to intermediate appellate authority, in Saleh v Romanous the New South Wales Court of Appeal considered how an equitable estoppel can operate in relation to a contract for the sale of land. Handley AJA (Giles JA and Sackville AJA agreeing) reasoned: Such an estoppel is not the equitable equivalent of a contract, and cannot give the purchasers positive rights to rescind and recover their deposit that they would have had if the pre-contractual promise had contractual force. A pre contractual promissory estoppel which conferred positive rights of that nature would be contrary to Hoyts' [(1919) 27 CLR 133] case.
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A promissory estoppel is a restraint on the enforcement of rights, and thus, unlike a proprietary estoppel, it must be negative in substance.
• The point was revisited by the same Court in DHJPM Ltd v Blackthorn Resources Ltd, where a lessee and prospective sub- lessee had entered discussions before the lessee acquired the head lease. After than acquisition, the prospective sub-lessee declared itself unwilling to take the sub-lease. In a holding that resonates in the present case, Meagher JA (Macfarlan JA agreeing) rejected the estoppel claim for the primary reason that: The negotiations and discussions between Mr Hannon and Mr Florey were between experienced businessmen. They should be taken to have expected that any right of occupation, whether by way of sub-lease or licence, would have to be the subject of a binding contract and that they could not safely rely upon a promise as legally binding without taking the necessary contractual steps or at least obtaining an assurance that made clear that the promise was to be regarded as binding notwithstanding that those steps had not been taken: Waltons Stores v Maher at 403; Baird Textiles v Marks & Spencer at [92].
•
Those observations apply with equal force to the plaintiffs' claim, founded on so-called "Reasonable Expectations", in the present case. The other reason for Meagher JA rejecting the estoppel claim was that the alleged understanding founding the estoppel did not involve any agreement as to essential terms of the grant of lease; this too applies to the present case in circumstances where the plaintiffs effectively ask the Court to craft terms upon which the parties never agreed. Writing separately, Handley AJA cited Saleh v Romanous as unanimous authority that "a promissory estoppel must be negative in substance. It is an equitable restraint on the enforcement of the promisor's rights.". This has since been cited with approval by a unanimous Court.
•
It is true that "significant dicta contrary to this limitation on promissory estoppel" can be identified. In the Port Judgment, Edelman J observed that the issue is "not yet finally resolved" under Australian law. The Victorian Court of Appeal and the Full Court of the Federal Court have noted the point and declined to resolve it. The Full Court of the Supreme Court of South Australia
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recently questioned the scope to be attributed to the holding in Saleh v Romanous, but affirmed the orthodoxy that "an estoppel does not create a legal relationship or generate any new cause of action".
•
Sitting as a first instance judge, Ward CJ in Eq (as her Honour then was) observed that Saleh v Romanous and the cases applying it were binding on her Honour. That is correct, in circumstances where the holding discussed above at least forms part of the ratio decidendi of Saleh v Romanous, and there is no appellate authority in Australia reaching the contrary conclusion. If such a claim for relief is to be awarded, whereby an equitable estoppel is deployed as a cause of action in its own right, it would require a change in the law at the appellate level. For that threshold reason, the plaintiffs' equitable estoppel claim must fail.
The Court's question 19(ii)
27 (ii) Putting aside the well known High Court case authorities addressing estoppel relief generally, including Legione v Hateley (1983) CLR 406, Commonwealth v Verwayen (1990) 170 CLR 394, Waltons Store v Maher (1988) 164 CLR 387, Foran v Wight (1989) 168 CLR 385 Crown Melbourne Ltd v Cosmopolitan Hotel (Vic) Pty Ltd (2016) 260 CLR 1, is there any other High Court of Australia case authority relied upon for the CITIC plaintiffs' contended utilisation of such estoppels as a causes of action to obtain compulsive order final relief? If so please provide the case(s), or if not, then the line of case authority relied upon for using estoppels as a causes of action and, in particular, identify a prior case where an estoppel by convention has been utilised as a basis to found a cause of action - as opposed to being deployed defensively to resist a claim.
CITIC plaintiffs' response to question 19(ii)
• As to question 19(ii), there are no other relevant High Court authorities of which the plaintiffs are aware beyond those referred to by the Court. However, the plaintiffs point to the following first instance and intermediate appellate authorities: o The Port Judgments: As addressed at [316] of the plaintiffs' closing submissions, in the Port Judgment, Edelman J held that an estoppel by convention arose from the terms of the Approved Proposals under the State Agreement, a conclusion upheld by the Full Court. His Honour held that the terms of the
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Approved Proposals formed a common position or assumption between the CITIC parties and Mineralogy, namely that the Project would be implemented and operated in accordance with those Approved Proposals. His Honour further held that it was to be inferred that the construction of the Project had been undertaken on the basis of the approval by the State of these proposals and this common position or assumption. His Honour granted injunctive relief to the CITIC parties on their cross-claim permanently restraining Mineralogy from acting upon certain termination notices which were contrary to the position adopted in those Approved Proposals. While his Honour did not expressly answer the question of whether estoppel by convention can operate as a cause of action, it is submitted that the decision, and in particular the grant of injunctive relief on the CITIC parties' crossclaim, can be seen as an example of estoppel by convention operating in such a way. Moreover, his Honour did, in the course of addressing the legal principles governing estoppel by convention, refer to the observation of Bathurst CJ in Ashton v Pratt (2015) 88 NSWLR 281 at [138] to the effect that there are significant dicta against the proposition that promissory estoppel only acts as a restraint on the enforcement of legal rights rather than as a source of obligation.
o
Waterman v Gerling Australia Insurance Co Pty Ltd (2005) 65 NSWLR 300; [2005] NSWSC 1066: In this case, Brereton J upheld a claim by a plaintiff against an insurer on the basis of a conventional estoppel, inconsistent with the express terms of the insurance policy, that punctual payment of premium instalments was not essential to the maintenance of cover under the policy: [102]. Although Brereton J did not state in terms that the conventional estoppel operated as a cause of action, it is submitted that in substance this was another instance of conventional estoppel operating in such a way. Again, in discussing the principles of conventional estoppel, Brereton J observed that the analogies between conventional estoppel and promissory estoppel "are considerable and close": [82]-[83].
o
F.J. & P.N. Curran Pty Ltd v Almond Investors Land Pty Ltd [2019] VSCA 236: In this case, the Victorian Court of Appeal held that a plaintiff should succeed in a claim for crop compensation on the basis of a conventional estoppel arising from a course of conduct: [227]-[244]. Again, it is submitted
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that this is an instance of conventional estoppel operating as a cause of action. This can be further seen from [245]-[246], where the Court refers separately to the ability of the plaintiff to rely on the conventional estoppel to defend a counterclaim. It may also be noted that at [241]-[242] the Court held that the conventional estoppel was not defeated by an "entire understanding" clause. Given the Court's conclusions on conventional estoppel, the Court did not need to address the issues which arose on the plaintiff's alternative promissory estoppel claim: [268].
o
Boon v Burt [2020] WASC 64: In this case, Curthoys J upheld the plaintiffs' claim to enforce a deed dividing the assets of a deceased's estate, but went on to observe that if the deed had been unenforceable, his Honour would have upheld the claim on the basis of a conventional estoppel, grounded in a common assumption that the assets would be divided as provided for in the deed: [218]-[234]. In so concluding his Honour referred with apparent approval at [219] to the discussion of principle by Edelman J in the Port Judgment. Again, it is submitted that, had his Honour needed to determine the claim on that basis, it would have been an example of conventional estoppel operating as a cause of action.
o
Bendigo and Adelaide Bank Ltd v Brackenridge [2020] SASC 114: In this case, Doyle J upheld the contractual claim of the plaintiff bank to enforce a guarantee secured by mortgages over the defendant's property. However, Doyle J also held that, if the plaintiff had failed on the contractual claim, it would have succeeded on alternative claims in estoppel by convention and estoppel by representation: [321]- [349]. Again, his Honour observed that the existence of an entire agreement clause was not an obstacle: [348]. An appeal from his Honour's findings on the estoppel claims was dismissed by the Court of Appeal: Brackenridge v Bendigo and Adelaide Bank Ltd [2021] SASCA 129 at [141]-[150] (Lovell, Livesey and Bleby JJ). Again, it is submitted that, had the Court needed to determine the plaintiff's claim on that basis, it would have been an example of both estoppel by convention, and estoppel by representation, operating as a cause of action.
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Mineralogy's response to question 19(ii)
•
This is a question for the plaintiffs. Mineralogy otherwise relies upon its answer to question 19(i), above.
The Court's question 20(a)
28 (a) Bearing in mind the CPOA's litigation outcomes and an approval by the Commonwealth Treasurer in November 2021 of the Balmoral Iron Pty Ltd Takeover Agreement, with settlement on that takeover duly being effected, what are the implications, if any. of the extra one billion tonnes of magnetite ore as an entitlement over the same mining lease areas having become available to CITIC under the Balmoral Iron MRSLA (akin to the Sino Iron and Korean Steel MRSLAs) - in the context of evaluating (if necessary) the reasonableness of the 29 November 2021 Herbert Smith Freehills (HSF) tenure request as hen made on behalf of the CITIC plaintiffs as the subject of par 150A of the CONSOC?
CITIC plaintiffs' response to question 20(a)
•
The plaintiffs do not rely on the recent acquisition of Balmoral Iron Pty Ltd, with its right to mine a further 1 Bt of magnetite ore, to support the reasonableness of the MCPs or the other requests. Rather, the plaintiffs' case is that what has been requested is reasonably required to enable Sino and Korean to exercise their rights to mine, process and export 2 Bt of magnetite ore.
Mineralogy's response to question 20(a)
• This has no bearing on the evaluation of the 2021 tenure request. The 2021 tenure request was made on behalf of Sino Iron and Korean Steel – not Balmoral Iron or CITIC. It referred to the 2017
MCPs and related documents which addressed the rights to extract 2 billion tonnes. The plaintiffs do not rely upon the extra billion tonnes of magnetite ore having become available to CITIC in their pleading or submissions.
The Court's question 20(b)
29 (b) Given the December 2017 MCPs for Sino Iron and Korean Steel delivered to Mineralogy to approve and submit are framed by reference to aggregate contractual rights to exploit (as between Sino Iron and Korean Steel) only two billion tonnes of magnetite ore across the same mining lease areas - does the augmentation at November 2021 of rights
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to extract a further billion tonnes of ore for Balmoral Iron as a CITIC subsidiary resulting from completion upon the exercise of an option afforded to CITIC under the CPOA - present as any further matter for required consideration - and bearing upon either (a) the reasonableness of the request as then made (at 29 November 2021) on behalf of Sino Iron and Korean Steel to Mineralogy for extra tenure areas; or (b) an objective assessment to be made concerning whether Mineralogy acted unreasonably in not immediately thereafter agreeing by 8 December 2021 to the 29 November 2021 extra tenure request as it was framed then by reference to a map that is now Annexure 11B to the CONSOC?
The CITIC plaintiffs' response to question 20(b)
• The answer to question 20(a) in paragraph 63 above applies equally here. • However, the plaintiffs further note that, in response to the November 2021 Tenure Request, Mineralogy (through Mr Palmer), stated on 8 December 2021:17 "We assure you that now that your clients have acquired a Third Company and the obligations under the CPOA have been met, which was not the case previously, we are happy to seriously consider your proposal without prejudice to our position that we are under no obligation to do so."
• The plaintiffs responded to this on 10 December 2021 as follows: "Your letter states that "now that your clients have
acquired a Third Company and the obligations under the CPOA have been met, which was not the case previously, we are happy to seriously consider your proposal without prejudice to our position that we are under no obligation
to do so."
The clear implication of this statement is that Mineralogy has not previously "seriously considered" our clients' proposal, despite having been in possession of the 2017 MCPs for four years. The further implication of this statement is that Mineralogy refrained from considering our clients' proposal until the competition of the acquisition of a Third Company under the CPOA. On this:
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•
The time taken to complete that acquisition has never provided a reasonable defence for Mineralogy's failure to submit the MCPs, as confirmed by the Court when his Honour struck out Mineralogy's defence on this topic: Sino Iron Pty Ltd v Mineralogy Pty Ltd [2020] WASC 311 at [331]-[339].
•
The time taken to complete the acquisition was in any event entirely the product of Mineralogy's long-running breach of its obligations under the CPOA, as confirmed by the Court in CITIC Ltd v Mineralogy Pty Ltd [No 5] [2021] WASC 89 at [47]-[49]."
• The plaintiffs repeat those observations here.
Mineralogy's response to question 20(b)
•
This does not present as a further matter for consideration for similar reasons as those given in answer to Q20(a). Further, the plaintiffs still did not offer any consideration for the additional tenure in the 2021 request or indicate a willingness to treat with Mineralogy about it. This counts against the reasonableness of the request and favours Mineralogy in the objective assessment of whether Mineralogy was acting reasonably in not agreeing to the request.
I certify that the preceding paragraphs comprise the reasons for decision of the
Supreme Court of Western Australia.
PP
Associate to the Honourable Justice K Martin
7 MARCH 2023
Second Defendant : In person (by video link)
Third Defendant : A Sefton SC
12
105
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