Sino Iron Pty Ltd v Mineralogy Pty Ltd [No 2]
[2021] WASC 170
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CIVIL
CITATION: SINO IRON PTY LTD -v- MINERALOGY PTY LTD [No 2] [2021] WASC 170
CORAM: QUINLAN CJ
HEARD: 15 & 21 APRIL 2021
DELIVERED : 28 MAY 2021
FILE NO/S: CIV 1915 of 2019
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
STATE OF WESTERN AUSTRALIA
Third Defendant
Catchwords:
Courts – Abuse of process – Application to stay proceedings – Allegation proceedings brought for collateral purposes – Whether necessary to show that plaintiffs have no intention to bring proceedings to a successful conclusion – Whether arguable case of abuse of process
Courts – Practice and procedure – Application to strike out or summarily dismiss interlocutory process – Jurisdiction to summarily dismiss interlocutory application – Inherent jurisdiction of the court to control its own processes – Relevance of case management principles
Legislation:
Iron Ore Processing (Mineralogy Pty Ltd) Agreement Act 2002 (WA)
Mining Act 1978 (WA)
Rules of the Supreme Court 1971 (WA), O 1, r 4A & r 4B
Result:
Application to summarily dismiss stay application granted
Application for permanent stay dismissed
Category: A
Representation:
Counsel:
| First Plaintiff | : | J H Karkar QC, J H Kirkwood & T Maxwell |
| Second Plaintiff | : | J H Karkar QC, J H Kirkwood & T Maxwell |
| Third Plaintiff | : | J H Karkar QC, J H Kirkwood & T Maxwell |
| First Defendant | : | P Dunning QC & K S Byrne |
| Second Defendant | : | P Dunning QC & K S Byrne |
| Third Defendant | : | No appearance |
Solicitors:
| First Plaintiff | : | Herbert Smith Freehills |
| Second Plaintiff | : | Herbert Smith Freehills |
| Third Plaintiff | : | Herbert Smith Freehills |
| First Defendant | : | Kane Jones |
| Second Defendant | : | Alexander Law |
| Third Defendant | : | State Solicitor's Office |
Cases referred to in decision:
Armstrong v McIntosh [No 4] [2020] WASC 31
Australian Electrical Electronics Foundry & Engineering Union, WA Branch v Hamersley Iron Pty Ltd (1998) 19 WAR 145
CITIC Ltd v Mineralogy Pty Ltd [No 5] [2021] WASC 89
CITIC Ltd v Mineralogy Pty Ltd [No 6] [2021] WASC 144
Dempster v National Companies and Securities Commission (1993) 9 WAR 215
Goldsmith v Sperrings Ltd [1977] 1 WLR 478
Hancock Prospecting Pty Ltd v DFD Rhodes Pty Ltd [2020] WASCA 77; (2020) 55 WAR 435
John Fairfax & Sons Limited v Police Tribunal of New South Wales (1986) 5 NSWLR 465
Mineralogy Pty Ltd v Sino Iron Pty Ltd (No 6) [2015] FCA 825; (2015) 329 ALR 1
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 [2021] WASC 45
Mineralogy Pty Ltd v Sino Iron Pty Ltd [No 13] [2016] WASC 403
Mineralogy Pty Ltd v Sino Iron Pty Ltd [No 16] [2017] WASC 340
Palmer v CITIC Ltd [No 2] [2019] WASC 14 (S)
PNJ v The Queen (2009) 83 ALJR 384; 252 ALR 612
Sino Iron Pty Ltd v Mineralogy Pty Ltd [2019] WASCA 80
Sino Iron Pty Ltd v Mineralogy Pty Ltd [2019] WASCA 80; (2019) 55 WAR 89
Sino Iron Pty Ltd v Mineralogy Pty Ltd [2020] WASC 311
Sino Iron Pty Ltd v Mineralogy Pty Ltd [No 2] [2017] WASCA 76; (2017) 55 WAR 36
Sino Iron Pty Ltd v Palmer (No 3) [2015] QSC 94; [2015] 2 Qd R 574
UBS AG v Tyne [2018] HCA 45; (2018) 265 CLR 77
Union Bank of Australia v Harrison Jones & Delvin Ltd (1910) 11 CLR 492
Victoria International Container Terminal Ltd v Lunt [2021] HCA 11
Williams v Spautz [1992] HCA 34; (1992) 174 CLR 509
Table of Contents
Introduction and overview
Substantive proceedings
State Agreement
MRSLAs
Facilities Deeds
Mine continuation proposals
Stay application
Fulcrum Purposes
Port proceedings
Summary determination of interlocutory applications
Abuse of process
Summary of the parties' submissions
Issue 1: is it necessary to show that the CITIC parties do not intend to prosecute the substantive proceedings?
Issue 1 – CITIC parties' submissions
Issue 1 – Mineralogy's submissions
Issue 2: is it arguable that the substantive proceedings have been improperly brought as part of the Fulcrum Purposes?
Issue 2 – CITIC parties' submissions
Issue 2 – Mineralogy's submissions
Issue 3: do the Port proceedings arguably give rise to an abuse of process or issue estoppel?
Issue 3 – Port proceedings
Issue 3 – Mineralogy's submissions
Issue 3 – CITIC parties' submissions
Disposition
Intention to bring the proceedings to trial
Fulcrum Purposes
1. 2010 Fulcrum Budget – Points of Claim [35](e)(i)
2. CPMM Department Plan and Budget – Points of Claim [35](e)(ii)
3. Email from Ms Dillon – Points of Claim [35](e)(iii)
4. SRF proceedings – Points of Claim [35](e)(iv)
5. Royalty Component A and Royalty Component B proceedings – Points of Claim [35](e)(v)
6. Telephone call on 13 February 2013 – Points of Claim [35](e)(vi)
7. Cosmo proceedings – Points of Claim [35](e)(vii)
8. Criminal complaints – Points of Claim [35](e)(viii)
9. Risk assessment spreadsheet – Points of Claim [35](e)(ix)
10. Ms Rifici's evidence in the SRF proceedings – Points of Claim [35](e)(iv)
Conclusions as to permanent stay
Conclusion as to alternative relief (Port proceedings)
Conclusion
Schedule
QUINLAN CJ:
Introduction and overview
For almost five years now, Justice Kenneth Martin has been valiantly case managing all of the litigation in this Court between the plaintiffs in this matter (CITIC parties) and the first and second defendants (Mineralogy). In 2019, his Honour described the collective disputes between those parties as 'litigious warfare, on a grand scale with many fronts'.[1] In February of this year, his Honour observed that nothing had changed since that time and that the 'battles continue to rage on many fronts'.[2]
[1] Palmer v CITIC Ltd [No 2] [2019] WASC 14 (S) [8] (Martin J).
[2] Mineralogy Pty Ltd v Sino Iron Pty Ltd [2021] WASC 45 [525] (Martin J).
The application before me concerns whether Mineralogy has an arguable basis for opening up another front in those battles, in the form of an application to stay the present action, commenced by the CITIC parties in the Federal Court in 2018 and transferred to this Court the following year, on the grounds that it is an abuse of process. By the present action (substantive proceedings) the CITIC parties seek relief in relation to certain mine continuation proposals (or MCPs) prepared by the CITIC parties in relation to a mining project conducted by the CITIC parties at Cape Preston in the Pilbara region of Western Australia (Sino Iron Project).
The stay application is based on an allegation by Mineralogy that the substantive proceedings are the product of a strategy by the CITIC parties to use litigation to vex and pressure Mineralogy, so that it agrees to (or is otherwise forced to provide) variations to its existing contractual arrangements with the CITIC parties.[3] While presented on a somewhat broader basis, at its heart the stay application is premised upon the proposition that the CITIC parties have brought this proceeding (and indeed have brought, and defended, other proceedings) for collateral and improper purposes.
[3] First and Second Defendants' Outline of Submissions on Plaintiff's Summary Dismissal or Strike Out Application dated 1 April 2021 (Mineralogy's Written Submissions) [8], [41].
As will be apparent, while it is an interlocutory application, determination of the stay application would itself involve the use of significant court time and resources. Counsel for Mineralogy estimates that 'efficiently run, it can be done in a couple of weeks'.[4] There is also the prospect of discovery being sought for the purposes of the stay application. Mineralogy has already filed a chamber summons for discovery on the stay application, which identifies, on any view, a wide net of potential documents.
[4] ts 413.
The CITIC parties, therefore bring this application seeking an order that I strike out or summarily dismiss the stay application.
For the reasons that follow, I am satisfied that the stay application should be summarily dismissed. On the basis of the material relied upon by Mineralogy, there is no arguable basis to contend that the substantive proceedings should be stayed as an abuse of process. In the absence of an arguable basis for contending that the substantive proceedings are an abuse, it is not, in my assessment in the interests of justice that the proceedings be further delayed, or the Court's resources be further devoted, to that contention.
Substantive proceedings
At the risk of oversimplification, some of the background to the substantive proceedings is, in broad terms, uncontroversial.
The first plaintiff (Sino Iron) and the second plaintiff (Korean Steel) are subsidiaries of the third plaintiff (CITIC).
State Agreement
Mineralogy,[5] Sino Iron and Korean Steel are all, along with others, parties to the Iron Ore Processing (Mineralogy Pty Ltd) Agreement (State Agreement or Agreement), a State agreement ratified by the Iron Ore Processing (Mineralogy Pty Ltd) Agreement Act 2002 (WA).
[5] While the first and second defendants are collectively referred to in these reasons as 'Mineralogy', in the context of the State Agreement, and indeed all agreements relating to the Sino Iron Project, 'Mineralogy' is a reference to the first defendant only, Mineralogy Pty Ltd.
As in the case of many agreements of its type, the State Agreement provides for the development and exploitation of mining tenements the subject of the Agreement, in accordance with proposals approved by the relevant Minister in the Government of Western Australia (Approved Proposals). The projects contemplated by the Agreement include mining activity in relation to 13 existing mining leases (08/118 to 08/130). Mineralogy is the registered holder of the mining leases and is 'the Company' within the meaning of the State Agreement. Under the Agreement, proposals to the relevant Minister must be submitted by the Company (i.e. Mineralogy), either alone or with co‑proponents.
Three of those mining leases (08/123, 08/124 and 08/125) (Sino Iron leases) are the subject of the Sino Iron Project, for which there are a number of Approved Proposals under the Agreement.[6] In accordance with the Sino Iron Project, broadly speaking, Sino Iron and Korean Steel hold mining rights authorising the extraction of iron ore from the Sino Iron leases.
[6] The Sino Iron Project is a defined term in the State Agreement.
Sino Iron and Korean Steel's rights in that regard are conferred, and regulated, by a number of agreements between them and Mineralogy. Those agreements include:
(a)the Mining Right and Site Lease Agreements (MRSLAs); and
(b)the Facilities Deeds (Facilities Deeds).
The complex network of contractual arrangements between the parties is, of course, not confined to these agreements.[7] Nevertheless, for present purposes, it is sufficient to refer only to the MRSLAs and the Facilities Deeds.
MRSLAs
[7] For a review of a number of the other agreements between the parties see Sino Iron Pty Ltd v Mineralogy Pty Ltd [2020] WASC 311 [24] (Martin J).
The MRSLAs are, relevantly, two largely identical agreements entered into by Mineralogy with Sino Iron and Korean Steel respectively.[8] The MRSLAs confer on Sino Iron and Korean Steel mining rights to the Sino Iron leases and grant a sublease over an area defined in the MRSLAs as the Site Lease Area (Site Lease Area).
[8] Exhibit O.
The Site Lease Area under the MRSLAs extends beyond the Sino Iron leases and includes areas for related activities, including tailings and waste storage, and port facilities. Relevantly, cl 4 of the MRSLAs provide:[9]
[9] The following clauses are taken from the Mining Right and Site Lease Agreement (MRSLA) in relation to Sino Iron. The MRSLA in relation to Korean Steel is in the same terms, save that the references to 'Sino' are references to 'Korean'.
4.1Site Lease Area
The Site Lease Area comprises each of the areas outlined in red in the plan attached to this Agreement as Annexure 1, situated within the Mining Leases, General Purposes Leases, Mining Leases 08/264, 08/265 and 08/266 and Miscellaneous Licence 08/20 or as otherwise agreed in writing between Mineralogy and Sino.
…
4.3Reservations, terms and restrictions
The Site Lease is granted subject to the reservations, terms, conditions and restrictions contained in:
(a)this Agreement;
(b)the State Agreement;
(c)the Facilities Deed;
(d)the Mining Leases; and
(e)applicable Legal Requirements including Government Approvals.
…
4.5Exclusive possession
(a)Subject to this Agreement, Sino shall be entitled to exclusive occupation of the Site Lease Area.
(b)Notwithstanding its right of exclusive possession, Sino will permit common carrier pipelines, roads and similar such facilities to deliver and transit over such Site Lease Area in accordance with approved Project Proposals under the State Agreement.
In exchange for the mining rights under the MRSLAs, Sino Iron and Korean Steel are obliged to pay Mineralogy royalties, as defined in the MRSLAs to include Royalty Component A and Royalty Component B.
Disputes over the CITIC parties' liability to pay Royalty Component A and Royalty Component B have previously been significant theatres of conflict between Mineralogy and the CITIC parties:
(a)the liability of Sino Iron and Korean Steel to pay Royalty Component A was the subject of this Court's decision in Mineralogy Pty Ltd v Sino Iron Pty Ltd[10] (Royalty Component A Decision); and
(b)the liability to pay Royalty Component B was the subject of Mineralogy Pty Ltd v Sino Iron Pty Ltd [No 16][11] and Sino Iron Pty Ltd v Mineralogy Pty Ltd.[12]
[10] Mineralogy Pty Ltd v Sino Iron Pty Ltd[2013] WASC 194.
[11] Mineralogy Pty Ltd v Sino Iron Pty Ltd [No 16][2017] WASC 340.
[12] Sino Iron Pty Ltd v Mineralogy Pty Ltd [2019] WASCA 80.
Mineralogy was substantially successful in those particular disputes.
Facilities Deeds
The Facilities Deeds are, again, largely identical agreements entered into by Mineralogy with Sino Iron and Korean Steel respectively.[13]
[13] Exhibit P.
The Facilities Deeds relate to the construction and use of facilities on land defined in the Facilities Deeds as the Preston Area. The Preston Area is an area originally covered by exploration licence 08/636, and includes port terminal facilities that are part of the Sino Iron Project.[14] That area, at least in part, is the subject of general purpose leases under the Mining Act 1978 (WA), including G08/53, G08/54, G08/63 and G08/74. The CITIC parties spent billions of dollars constructing various facilities in the Preston Area, including port facilities, for the purposes of the Sino Iron Project.
[14] The extent of exploration licence 08/636, and thus the Preston Area, was the subject of the Federal Court's decision in Mineralogy Pty Ltd v Sino Iron Pty Ltd (No 6) [2015] FCA 825; (2015) 329 ALR 1 (Mineralogy (No 6)) (see at [87] (Edelman J); Annexure 3).
It is a significant feature of the Facilities Deeds that they make provision for the potential use of the Preston Area for a number of different mining operations. Indeed, not only are the Facilities Deeds with Sino Iron and Korean Steel largely identical, those Deeds are two of six identical Deeds entered into by Mineralogy at the same time (in contemplation of other projects under the State Agreement).[15]
[15] Mineralogy (No 6) [294] ‑ [295] (Edelman J).
The Facilities Deeds provide a hierarchy of definitions in relation to 'Facilities' that are subject to the Deeds.[16] 'Facilities' are defined broadly and include any facilities in the Preston Area that are approved by Mineralogy from time to time.
[16] See generally Mineralogy (No 6) [375] ‑ [378] (Edelman J).
Under that broad definition, the Facilities Deeds provide for 'Company Facilities' (or 'Approved Company Facilities') and 'Shared Facilities' (or 'Approved Shared Facilities'). 'Company Facilities' are those approved and developed by the relevant 'Company' (i.e. Sino Iron or Korean Steel as the case may be). 'Shared Facilities' are facilities identified by Mineralogy as facilities which may service more than one user. Where facilities are so identified in accordance with the Facilities Deeds, Approved Company Facilities can become Approved Shared Facilities.[17]
[17] See generally Mineralogy (No 6) [378] (Edelman J).
The Facilities Deeds have also been the subject of significant litigation between the parties.[18]
[18] See Mineralogy (No 6) and Mineralogy Pty Ltd v Sino Iron Pty Ltd [2017] FCAFC 55.
In those disputes it was the CITIC parties that were successful, both at first instance and on appeal.
Those proceedings, which were heard in the Federal Court, were particularly concerned with the facilities at the port at Cape Preston (the Port). In the application before me, those proceedings were referred to as the Port proceedings. The Port proceedings have chapters all of their own later in these reasons.
Mine continuation proposals
At its most basic level, the substantive proceedings in the present case concern the CITIC parties' desire to expand their operations as part of the Sino Iron Project. In broad terms, the CITIC parties seek, inter alia, to:[19]
(a)extend the mine pit within the Sino Iron leases;
(b)increase tailings and waste capacity on existing tenements and onto additional tenements (including G08/53, G08/54 and G08/63);
(c)increase the capacity of existing stockpiles and associated infrastructure at the Port; and
(d)construct new infrastructure corridors.
[19] See Exhibit M, page 23 (Affidavit of Christopher Spielvogel sworn 7 April 2021, Annexure CS4).
In pursuit of these ends, the CITIC parties prepared a number of Mine Continuation Proposals for submission to the Minister under the State Agreement for approval under that Agreement.[20] As I have noted at [10] above, under the terms of the State Agreement, proposals must be submitted by Mineralogy, either alone or with co‑proponents. There is no capacity for the CITIC parties to submit proposals for approval under the Agreement without the involvement of Mineralogy.
[20] In this context, the 'CITIC parties' include CITIC Pacific Mining Management Pty Ltd (CPMM), a subsidiary of the third plaintiff, which is relevantly the agent of Sino Iron and Korean Steel.
Of most relevance to the substantive proceedings are proposals defined in the Statement of Claim as the 2017 MCPs. The 2017 MCPs seek approval for the activities described at [27] above. According to the Statement of Claim the 2017 MCPs:[21]
(a)constituted the further proposals which had been foreshadowed in the 2010 Approved Proposals to enable full implementation of the Sino Iron Project after approximately the first five years;
(b)did not seek to alter the mining, processing and tailings production rates in the Approved Proposals but rather proposed … steps to enable continuation of the existing operations of the Sino Iron Project approved under the Approved Proposals and to ensure continuous operation of the Sino Iron Project as required by the State Agreement.
[21] Statement of Claim dated 23 October 2018 (Statement of Claim) [138].
The CITIC parties plead that, on and from 18 December 2017, they requested that Mineralogy submit the 2017 MCPs to the Minister for approval under the State Agreement.[22] They also plead that Mineralogy has failed, and refused to, submit the 2017 MCPs to the Minister for approval under the State Agreement.[23]
[22] Statement of Claim [137].
[23] Statement of Claim [140].
While Mineralogy denies that the relevant correspondence on behalf of the CITIC parties constituted valid 'requests' and says that the 2017 MCPs are not in a form capable of submission, it does not appear to be in dispute that the CITIC parties sent that correspondence to Mineralogy, or that Mineralogy has not submitted the 2017 MCPs to the State.[24] The CITIC parties also plead that the Director General of the relevant State government department requested that Mineralogy carefully consider submitting the 2017 MCPs to the Minister.[25]
[24] First Defendant's Second Further Amended Defence to the Statement of Claim filed 19 October 2018 dated 17 September 2020 (Defence) [137], [140].
[25] Statement of Claim [139].
In addition to the 2017 MCPs, the CITIC parties also plead that they made requests of Mineralogy that it:
(a)agree to the expansion of the Site Lease Area within the meaning of the MRSLAs to include certain areas falling within the footprint of the 2017 MCPs;[26]
(b)take steps to secure changes to the purposes of the areas covered by G08/53, G08/54 and G08/63 to include purposes consistent with the 2017 MCPs;[27] and
(c)submit, or authorise the CITIC parties to submit, a program of works to the Department of Mines, Industry Regulation and Safety, which they plead are 'critical' to further define the works required for the 2017 MCPs.[28]
[26] Statement of Claim [147].
[27] Statement of Claim [148].
[28] Statement of Claim [159] ‑ [160].
Again, while it denies the how and the why, there does not appear to be any dispute that Mineralogy has not acceded to the CITIC parties' requests in relation to these matters.[29]
[29] Defence [147], [148], [150].
The CITIC parties contend that the failure of Mineralogy to submit the 2017 MCPs to the Minister for approval under the State Agreement and to take the other steps referred to above, constitute breaches of Mineralogy's contractual obligations, unconscionable conduct within the meaning of the Australian Consumer Law (ACL) and actionable estoppels.
On these bases, the CITIC parties seek relief in the substantive proceedings to compel Mineralogy to take those steps. The relief claimed in the Statement of Claim includes the following:
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.
B.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.agree in writing with each of Sino Iron and Korean Steel that the Site Lease Area, within the meaning of clauses 1.1 and 4.1 of each of the Sino Iron MRSLA and the Korean Steel MRSLA, comprises each of the areas outlined in the map in Annexure 11 to this statement of claim; and
b.alternatively to (a), grant to Sino Iron and Korean Steel such further tenure as the Court determines is reasonably required by Sino Iron and Korean Steel for the purposes of the 2017 MCPs, upon such terms as the Court determines are reasonable.
C.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 take the following steps to secure the repurposing of G08/53, G08/54 and G08/63 to enable the establishment of the infrastructure and facilities provided for in the 2017 MCPs:
a.conditionally surrender each of G08/53, G08/54 and G08/63, such surrender being conditional upon the grant of the general purpose leases referred to in subparagraph (b) below; and
b.apply for the grant of general purpose leases over the areas presently covered by G08/53, G08/54 and G08/63, with purposes consistent with the proposed usage of those areas identified in the 2017 MCPs.
D.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, submit the PoW to DMIRS for assessment, or authorise CPMM to submit the PoW to DMIRS for assessment on behalf of Mineralogy.
The references to 'specific performance' in this context are probably more properly characterised as being claims for mandatory injunctions, a matter discussed by Martin J in Sino Iron Pty Ltd v Mineralogy Pty Ltd.[30]
[30] Sino Iron Pty Ltd v Mineralogy Pty Ltd [2020] WASC 311 [76] ‑ [82] (Martin J).
In addition to these coercive orders, the prayer for relief in the Statement of Claim also includes claims by the CITIC parties for damages and other forms of compensation for the alleged breaches.
As I have already observed, the legal bases pleaded by the CITIC parties for the various forms of relief are manifold: breach of contract, unconscionable conduct and actionable estoppel.
The contractual claims themselves are based on a complex process of construction and implication in relation to a number of contractual agreements, including (but not limited to) the State Agreement and the MRSLAs. The pleading, as a whole, is nothing if not inventive. A partial 'journey' through the pleaded process of construction and implication was undertaken by Martin J in Sino Iron Pty Ltd v Mineralogy Pty Ltd.[31]
[31] Sino Iron Pty Ltd v Mineralogy Pty Ltd [2020] WASC 311 [90] ‑ [129] (Martin J).
It is not necessary, for present purposes, to embark upon that journey again. Notwithstanding Mineralogy's occasional references to the 'romancing nature'[32] of the terms sought to be implied by the CITIC parties and the suggestion that 'the prospects of making good the implied term don't look flash',[33] there has not been, since the Statement of Claim was filed by the CITIC parties on 23 October 2018, any application by Mineralogy to strike out any part of the Statement of Claim on the basis that it fails to disclose a reasonable cause of action. It is too late to bring such an application now.
[32] ts 407.
[33] ts 440.
Nor, in my view, would it be appropriate for this application, or indeed the stay application, to be a Trojan horse for what is, in truth, a strike out application or application for summary judgment. In the absence of a properly formulated application to that effect, it would, in my view, be inappropriate to treat the novel, and in some respects inventive, parts of the substantive proceedings as, for that reason, failing to disclose a reasonable cause of action.
Nor, to be fair, did Mineralogy put its case before me on that footing. Rather, it submitted that the apparent novelty of the claims made in the substantive proceedings was a consideration that goes to show that the proceedings were brought for a collateral purpose, and have not been brought for the genuine purpose of advancing the legal claims made therein.[34]
[34] See ts 327, 331 ‑ 332, 392, 440.
For the purposes of this application, and in particular whether there is an arguable basis for Mineralogy's contention that the substantive proceedings have been brought for a collateral purpose, I have had regard to the extent that the CITIC parties may be said to raise novel or ambitious claims. I will return to those matters in due course.
Stay application
As noted at the outset, Mineralogy's application for a permanent stay centres around the contention that the CITIC parties have brought the substantive proceedings (and indeed have brought, and defended, other proceedings) for collateral and improper purposes. Those purposes were described in Mineralogy's submissions as 'the Fulcrum Purposes'.
The nature of the issues sought to be raised in the stay application are set out in a comprehensive Points of Claim, which was amended by Mineralogy shortly prior to the hearing before me.[35]
[35] First and Second Defendants' Amended Points of Claim dated 12 April 2021 (Points of Claim).
The Points of Claim commence with much of the background to the Sino Iron Project, including what Mineralogy pleads were significant cost overruns on the Project as well as very substantial losses by CITIC on the Hong Kong Stock Exchange in 2008.[36]
[36] Points of Claim [23] ‑ [29].
As a consequence of these matters, the Points of Claim allege that, by no later than May 2010, CITIC formed the view that it was dissatisfied with the agreements the CITIC parties had reached with Mineralogy[37] and resolved to alter those contractual arrangements. The Points of Claim define CITIC's objectives in this regard as the Contract 'Normalisation' Objective.[38]
[37] Defined in the Points of Claim as the CITIC Negotiated Agreements.
[38] Points of Claim [30].
Mineralogy contends that, consistent with the Contract 'Normalisation' Objective, representatives of CITIC advised representatives of Mineralogy that it wished to vary the royalty formula and to 'negotiate [a] new contract'.[39]
[39] Exhibit B.
Assuming all of this to be the case (as I do for the purposes of this application), to this point the Points of Claim are unremarkable.
Fulcrum Purposes
The critical allegation in the Points of Claim comes next and concerns the creation of a group of senior executives and advisors of the CITIC parties, known as the Fulcrum Group, of which Ms Helen Dillon, a deputy director of CPMM, is said to have been appointed as the 'lead'. As to this last matter Mineralogy rely upon an affidavit affirmed by Ms Dillon on 19 November 2012 to the effect that she had been appointed 'to lead a team of people that had been established to address various issues concerning the Project which concerned the interaction between CITIC and Mineralogy'.[40]
[40] Exhibit D.
Again so far, so unremarkable. There is not a hint in Ms Dillon's affidavit that the 'team' she was appointed to lead was in any way clandestine or sinister.
The allegation of a sinister purpose to the Fulcrum Group commences from [35] of the Points of Claim, which alleges:
The purposes of the Fulcrum Group included to achieve the Contract 'Normalisation' Objective by the:
(a)use legal proceedings, including as moving party and resisting party, to apply commercial pressure to Mineralogy and Mr Palmer to agree to alter the contractual relationship between the parties under the CITIC Negotiated Agreements, rather than to vindicate any bona fide claim or defence;
(b)use legal proceedings by complaints to regulatory and law enforcement authorities to apply commercial pressure to Mineralogy and Mr Palmer to agree to alter the contractual relationship between the parties, rather than to have some bona fide wrong sanctioned or loss recovered;
(c)by the use of legal proceedings as alleged in (a) and (b) above, to enable CITIC to recoup the unexpected costs of developing the Sino Iron Project directly from Mineralogy or indirectly from Mineralogy by denying to it sums to which it was entitled, including royalties, and potentially thereby rendering it insolvent and leaving CITIC able to pursue the Sino Iron Project on terms more favourable to it;
(d)thereby to engage legal processes in the manner alleged in (a) to (c) above not for the purpose of vindicating any legal right or defence at law or complaint about a loss or injury bona fide held, but rather to achieve a collateral purpose being the Contract 'Normalisation' Objective (the Fulcrum Purposes) ...
The allegation that the CITIC parties developed a strategy in the form of the Fulcrum Purposes, as defined, is an allegation of the utmost seriousness. It is necessary to recognise that the allegation involves two distinct components:
(a)that litigation (including the substantive proceedings) is to be used for collateral purposes (i.e. commercial pressure); and
(b)that litigation has been commenced, or conducted, not for the purposes of vindicating any bona fide legal position.
The Points of Claim are admirably clear in identifying the basis upon which Mineralogy alleges that the Fulcrum Purposes may be found or inferred. Mineralogy has, again admirably, nailed its colours to the mast in a manner that enables an assessment to be made as to whether there is an arguable basis for the allegation. I will therefore set them out in full. At Points of Claim [35](e) Mineralogy pleads:
(e)the Fulcrum Purposes are recorded in, and/or may be inferred from, the following documents and testimony:
(i)The Project Fulcrum Budget (Mineralogy) dated 30 September 2010 budgeted for a contractual obligation to pay:
(1)$20m to the Site Remediation Fund by June of 2011(at rows 32 and 500);
(2)$14.8225 m for Royalty A by December 2011 (rows 40, 570‑575 and 612); and
(3)$280.630515 m for Royalty B by December 2011(rows 41, 577‑595 and 613);
(ii)CITIC Pacific Mining Management, Department Plan and Budget for the calendar year 2013, dated 16 October 2012 recorded:
(1)the reason for 'Project Fulcrum' was '[d]ue to the poor contracts that were entered into in 2006 and 2008 and on the Sino Iron and Korean Steel Projects, there is a requirement to normalise the contracts as far as possible towards industry standards' (at .0077);
(2)the forecast contractual obligations to pay royalties to Mineralogy under the CITIC Negotiated Agreements of $5.265m for Royalty A, $72.734m for Royalty B and $230.073m for what it described as the Royalty Penalty for the calendar year 2013 (at .0051);
(3)'… there is a dispute related to royalties that is currently between the parties. It is expected that this dispute may affect the timing of payment in relation to the Royalty Penalty and Royalty Component B as such the following has been removed from the 2013 base budget forecast. A request has been made to ensure that the following [being the $230.073m and $72.734m] can be easily accessed if required to fulfill a short notice requirement.' (at .0051) Thus, the purpose for the defending of the proceedings was to delay a payment known to be payable, rather than attempt to vindicate a defence that was believed to be arguable;
(4)in relation to the Site Remediation Fund and the request for payment into the fund by Mineralogy, '[t]he request from Mineralogy was denied on the grounds it was unreasonable, however it should be noted that there is a contractual obligation for Sino Iron and Korean Steel to contribute towards a Site Remediation Fund. Negotiations are occurring with Mineralogy to explore other options such as a corporate guarantee to fulfil this obligation. If this negotiation is successful, then it will require changes to the project agreements to solidity [sic] fulfilment of this obligation. Either way, this is a risk that is currently being managed by the Special Projects team. Consequently, a request has been made to ensure that ~$75Million can be easily accessed if required to fulfill this requirement.' (at .0050) Thus, the basis for the refusal to pay any amount was the desire to use the non‑payment of an amount contractually obliged to facilitate the negotiation of different contractual terms: [CPM.518.004.0047]
(iii)On 16 October 2012 Ms Dillon emailed Dr Hua and Mr Walkland:
(1)recording 'Attached is updated after conversation with Charles. He has asked me to move $75 Million and the Royalty B + Royalty Penalty to 2014. The reason being that the Royalties will be in dispute, and we will be negotiating for guarantees instead of payment of the Site Remediation Fund.';
(2)such correspondence recorded the belief in an existing contractual obligation to make the payments and the use of the defence of the proceedings to defer such payments: [CPM.523.003.1670]
(iv)Notwithstanding the acceptance of the obligations in relation to the SRF (defined in paragraph [53] under the CITIC Negotiated Agreements as recorded at sub‑paragraphs [35](e)(i), [35](e)(ii), and [35](e)(iii) above, Sino and Korean have not contributed to the Site Remediation Fund and defended proceedings for them to pay into it as alleged in paragraphs [54] to [57] below;
(v)Notwithstanding the acceptance of the obligations in relation to Royalty Component A and B under the CITIC Negotiated Agreements as recorded at sub‑paragraphs [35](e)(i), [35](e)(ii), and [35](e)(iii) above, Sino and Korean refused to pay any of the royalties until forced by court order and defended proceedings for them to pay those royalties as alleged in paragraphs [37] to [52] below;
(vi)During a telephone call on 13 February 2013 between Mr Woods of Allens and Mr Prescott of HopgoodGanim, Mr Woods said words to the effect that assuming litigation in respect of Royalty Component B is commenced and that eventually Mineralogy wins everything, bearing in mind the other litigation on foot (which was already 8 months old), when did Mineralogy think it would reach conclusion of the Royalty Component B litigation;
(vii)The conduct of the Cosmo Proceeding as alleged in paragraphs [58] to [64] below;
(viii)The criminal complaints as alleged in paragraphs [65] to [67] below;
(ix)Spreadsheet titled '2017 Risk Assessment Table' stating that a strategy to deal with 'Legal Dispute Risk' included 'Civil or criminal suit to deal with the risk' and that the statement was made in the context of disputes with Mineralogy and Mr Palmer: [CPM639.173.2597]
(x)The normalisation of the CITIC Negotiated Agreements referred to in sub‑paragraph [35](e)(ii) above was a reference to CITIC's desire to alter the contractual arrangements with Mineralogy and Mr Palmer under the CITIC Negotiated Agreements because the commercial terms effected by those agreements were one Sino and Korean considered unsatisfactory. (evidence of Ms M.L. Rifici in CIV 2840 of 2018, 19/11/20 t pp 320‑322).
As can be seen, a number of the matters relied upon in support of the allegation as to the Fulcrum Purposes consist of specific documents and testimony (Points of Claim [35](e)(i), (ii), (iii), (vi), (ix), and (x)). For the purposes of the application, I received into evidence each of those documents and the transcripts of the relevant testimony. Each of them are addressed later in these reasons.
The other matters in support of the allegation as to the Fulcrum Purposes concern prior court (and other) proceedings which Mineralogy contends are both evidence of, and were conducted in furtherance of, the Fulcrum Purposes (Points of Claim [35](e)(iv), (v), (vi), (vii), and (viii)). Those proceedings are:
(a)proceedings in this Court in relation to Royalty Component A (referred to at [17(a)] above);
(b)proceedings in this Court in relation to Royalty Component B (referred to at [17(b)] above);
(c)proceedings in this Court concerning the Site Remediation Fund required to be established under the MRSLAs (SRF proceedings). The SRF proceedings were the subject of Martin J's recent decision in Mineralogy Pty Ltd v Sino Iron Pty Ltd[41] (SRF Decision);
(d)proceedings in the Supreme Court of Queensland commenced by Sino Iron and Korean Steel against Mr Palmer and Cosmo Developments Pty Ltd (Cosmo proceedings); and
(e)complaints in relation to alleged criminal conduct by Mineralogy (including Mr Palmer) to authorities, including the Western Australia Police Force and the Australian Securities and Investments Commission (ASIC).
[41] Mineralogy Pty Ltd v Sino Iron Pty Ltd [2021] WASC 45.
Each of these matters are the subject of further pleading in the Points of Claim, but they each allege that the relevant conduct was engaged in as part of the Fulcrum Purposes.
The Points of Claim culminate in the allegation (at [72]) that the substantive proceedings have been commenced:
(a)as part of the Fulcrum Purposes;
(b)to permanently deprive Mineralogy of the ability to exploit and develop the balance of the Mineralogy Tenements, especially with any third party other than CITIC or any subsidiary company;
(c)to vex Mineralogy with proceedings that are likely to lead to a trial that will run for months and consume a great amount of costs and management time of Mineralogy and prevent it from meaningfully pursuing the development or sale of the balance of the Mineralogy Tenements outside the Sino Iron Project in the meantime; and/or
(d)as part of a number of proceedings, as described in Section H above, having the effects described in paragraph 75A below.
The effects described in paragraph [75A] are that the CITIC parties:
(a)have commenced, or by their conduct forced Mineralogy to commence, multiple proceedings as part of the Fulcrum Purposes;
(b)have acted in a manner that is vexatious and/or oppressive to Mineralogy; and
(c)by reason of (a) and/or (b) above, have brought the administration of justice into disrepute.
As will become apparent, by this pleading, Mineralogy seeks to invoke each of the 'typical' characteristics identified by the High Court of Australia exhibited by cases of abuse of process.[42]
Port proceedings
[42] Victoria International Container Terminal Ltd v Lunt [2021] HCA 11 (Lunt) [14] (Kiefel CJ, Gageler, Keane & Gordon JJ), citing PNJ v The Queen (2009) 83 ALJR 384; 385 ‑ 386 [3]; 252 ALR 612, 613 (French CJ, Gummow, Hayne, Crennan & Kiefel JJ).
As I noted above, Mineralogy amended its Points of Claim shortly prior to the hearing before me. The most substantial amendment was to include a separate and distinct allegation of abuse of process, beyond that said to arise from the Fulcrum Purposes (although it also includes reference to the Fulcrum Purposes).[43]
[43] See Points of Claim [72A](i)(ii).
That allegation is said to arise from the Port proceedings (referred to at [24] to [26] above). Mineralogy contends that the Port proceedings finally settled certain questions of construction of the Facilities Deeds. In particular, Mineralogy contends that the Port proceedings finally determined the following propositions adverse to the CITIC parties:[44]
(i)there was an unconstrained entitlement to third party use of the facilities constructed by the plaintiffs[45] at the Port by the plaintiffs leaving space for further facilities to be developed separately in the future; ….; and further
(ii)that facilities constructed by the plaintiffs at the Port of Cape Preston could become 'Shared Facilities' under the Facilities Deeds entered into between Mineralogy and Sino Iron and Mineralogy and Korean Steel respectively; …;
(iii)the facilities constructed by the plaintiffs at the Port could become 'Shared Facilities' if another user of the port were to require access to the facilities; … ;
(iv)if the facilities became 'Shared Facilities', Mineralogy would own the facilities; …;
[44] Points of Claim [72A](b).
[45] At the hearing of the application, Mineralogy accepted that this first passage was better expressed as 'an unconstrained entitlement to third party use of the facilities constructed by [those third parties]'; see ts 511.
Mineralogy then contends that the substantive proceedings are an abuse of process (or alternatively give rise to issue or Anshun estoppels) for the reasons that:
(g)a consequence of the relief sought in [the substantive proceedings] is that no other user could use the facilities at the Port because of the nature and extent of the tenure sought by the [CITIC parties];
(h)the 'Mine Continuation Proposals' and the proposed extension to the Site Lease Area seek to achieve the same practical outcome as the construction of the Facilities Deeds [said to be advanced by the CITIC parties in the Port proceedings], namely exclusive use of the Port for the [CITIC parties], which construction was rejected in the Port Judgments, in favour of the different construction of the Facilities Deeds pleaded in paragraph 72A (b) above;
As a consequence of all of the matters pleaded in the Points of Claim, Mineralogy seeks orders in the stay application that:
[76][The substantive proceedings] be permanently stayed.
[76A]Alternatively, [the substantive proceedings] be permanently stayed and the statement of claim be struck out to the extent it raises matters the subject of issue, Anshun or abuse of process estoppels arising by reason of the Port Judgments.
As will be apparent, the alternative relief sought (in Points of Claim [76A]) is focused particularly on the allegations in the Points of Claim concerning the Port proceedings. It will be convenient, in due course, to deal with that issue separately.
Before turning to the principles to be applied as to abuse of process, it is necessary to address a preliminary issue concerning the approach to be taken by the Court in the application before me, which is an application to strike out or summarily dismiss the stay application.
Summary determination of interlocutory applications
Mineralogy's Written Submissions raised what it described as an in limine objection to the CITIC parties' application to strike out or summarily dismiss the stay application. It submitted that the CITIC parties had 'failed to identify any jurisdictional basis on which [the Court] may dismiss or strike out an interlocutory application' and so the CITIC parties' summons should be dismissed.[46]
[46] Mineralogy's Written Submissions [31].
The submission was a little coy. Mineralogy did not go so far as to submit that there was no jurisdictional basis upon which the Court may summarily dismiss an interlocutory application, merely that the CITIC parties had failed to identify one.
As I did during the hearing of the application, I should explain why there is such a jurisdictional basis and set out the approach I have taken to this application generally.
The starting point is to recognise that interlocutory processes, however important, all exist in the service of the attainment of justice in the substantive dispute that has been brought before the Court for determination. They are not ends in themselves.[47]
[47] Union Bank of Australia v Harrison Jones & Delvin Ltd (1910) 11 CLR 492, 504 (Griffith CJ).
The Court's power to control its own processes is, of course, not confined by the interlocutory processes prescribed by the Rules of the Supreme Court 1971 (WA) (Rules). The Court's inherent power to control the conduct of a proceeding, which is not affected by the Rules,[48] extends to such orders as are necessary to enable the Court to uphold, protect and fulfil the judicial function by ensuring that justice is administered, both in a particular case and as a continuing process, according to law and in an effective manner.[49]
[48] Rules, O 1 r 3A.
[49] John Fairfax & Sons Limited v Police Tribunal of New South Wales (1986) 5 NSWLR 465, 476 (McHugh JA).
A party has a right to invoke the jurisdiction of the courts, and where jurisdiction exists, access to the courts by a litigant is a right.[50] A party does not, however, have an unqualified right to bring, and have determined, interlocutory applications. Whether an interlocutory application is determined summarily, or following a full hearing, will depend upon the extent to which it serves the ultimate attainment of justice and may involve issues of proportionality.
[50] Hancock Prospecting Pty Ltd v DFD Rhodes Pty Ltd [2020] WASCA 77; (2020) 55 WAR 435, 503 [396] (Quinlan CJ).
These principles, which must exist as part of the Court's control over its own processes, are expressly recognised in the Rules.
Order 1 r 4A of the Rules, for example, provides:
The practice, procedure and interlocutory processes of the Court shall have as their goal the elimination of any lapse of time from the date of initiation of proceedings to their final determination beyond that reasonably required for interlocutory activities essential to the fair and just determination of the issues bona fide in contention between the parties and the preparation of the case for trial.
Similarly, O 1 r 4B provides, in relation to the management of actions, causes and matters in the Court:
(1)Actions, causes and matters in the Court will, to the extent that the resources of the Court permit, be managed and supervised in accordance with a system of positive case flow management with the objects of –
(a)promoting the just determination of litigation; and
(b)disposing efficiently of the business of the Court; and
(c)maximising the efficient use of available judicial and administrative resources; and
(d)facilitating the timely disposal of business; and
(e)ensuring the procedure applicable, and the costs of the procedure to the parties and the State, are proportionate to the value, importance and complexity of the subject matter in dispute; and
(f)that the procedure applicable, and the costs of the procedure to the parties, are proportionate to the financial position of each party.
(2)These rules are to be construed and applied and the processes and procedures of the Court conducted so as best to ensure the attainment of the objects referred to in subrule (1).
An interlocutory application that would not best ensure the attainment of the objects set out in O 1 r 4A and r 4B, is one that the Court should decline to devote any further resources than are necessary to do justice to the parties.
This will be particularly so, where the interlocutory application brought by a party would itself occasion substantial hearing time, expense and potential delay. Mineralogy's stay application in the present case, for example, would itself involve the use of significant court time and resources. Indeed, it would be an interlocutory application whose time and expense would exceed that of a great many trials in this Court. Even the application before me, to identify whether it was arguable, involved a substantial commitment of time and resources by the Court and the parties.
It could not be the case that the Court is unable, in controlling its own processes, to summarily determine that an interlocutory order sought by a party is not arguable, such that it should not proceed to a 'full hearing'. To so conclude would involve the Court becoming hostage to its own processes. Indeed, it is one of the (many) ironies of this case that the very power that Mineralogy invokes in the stay application (namely the inherent power of the Court to control its own processes) is the very jurisdictional basis that it coyly submits that the CITIC parties had 'failed to identify' for its application to summarily dismiss the stay application.
Rather, in my view, in a case such as the present, where it is open to determine, following a reasonable opportunity for each party to be heard, that there is no reasonably arguable basis for an interlocutory order sought in the proceedings, the Court has power in a clear case to dismiss the interlocutory application without a 'full hearing'.
In the present case, I have approached the issue as to whether Mineralogy has an 'arguable' basis for a permanent stay of the substantive proceedings (or the alternative relief), in terms of whether, on the basis of the material pleaded in the Points of Claim, the stay application is reasonably capable of being argued, in the sense that it has some prospect of success.[51]
[51] Dempster v National Companies and Securities Commission (1993) 9 WAR 215, 262 (Malcolm CJ).
In this regard, as I have said above, the Points of Claim are admirably clear in identifying the basis upon which Mineralogy alleges that the Fulcrum Purposes may be found or inferred so as to enable an assessment to be made as to whether there is an arguable basis for that allegation.
Abuse of process
The parties were agreed as to a number of the principles in relation to the power of courts to prevent an abuse of process.
Those principles were recently the subject of the decision of the High Court in Lunt. In Lunt the plurality confirmed, in the context of an application to stay proceedings:[52]
The fundamental responsibility of a court is to do justice between the parties to the matters that come before it. In the performance of that function, the doing of justice may require the court to protect the due administration of justice by protecting itself from abuse of its processes. The power to stay, or summarily dismiss, proceedings because one party has abused the processes of the court is concerned to prevent injustice, and that power is properly exercised where the conduct of the moving party is such that the abuse of process on its part may prevent or stultify the fair and just determination of a matter.
In Strickland (a pseudonym) v Director of Public Prosecutions (Cth), Gageler J explained that the concern which engages a court's power to order a stay of proceedings is the need to protect the integrity of its own processes. His Honour said:
'The power of a superior court to stay its own proceedings as an abuse of process is a power to protect the integrity of its own processes. The power is in that limited respect and to that limited extent a power to 'safeguard the administration of justice.'
[52] Lunt [18] ‑ [19] (Kiefel CJ, Gageler, Keane & Gordon JJ) (references omitted).
As has been long recognised, the doctrine of abuse of process cannot be confined to closed categories, a principle reaffirmed in Lunt:[53]
In PNJ v The Queen French CJ, Gummow, Hayne, Crennan and Kiefel JJ said:
'It is not possible to describe exhaustively what will constitute an abuse of process. It may be accepted, however, that many cases of abuse of process will exhibit at least one of three characteristics:
(a)the invoking of a court's processes for an illegitimate or collateral purpose;
(b)the use of the court's procedures would be unjustifiably oppressive to a party; or
(c)the use of the court's procedures would bring the administration of justice into disrepute.'
[53] Lunt [1] (Kiefel CJ, Gageler, Keane & Gordon JJ) (references omitted).
As I have already observed, in the Points of Claim Mineralogy invokes each of the three 'typical' characteristics identified in this passage.[54]
[54] See [59] ‑ [60] above.
Nevertheless, leaving aside the allegations in the Points of Claim concerning the Port proceedings, it is clear from the Points of Claim and Mineralogy's submissions as a whole that the real focus of its case is on the first characteristic: namely the invocation of the Court's processes for an illegitimate or collateral purpose (and in particular the Fulcrum Purposes). It is upon that issue, in my view, that the application properly turns.
That is, (and again, leaving aside the Port proceedings issue) unless there is an arguable case that the substantive proceedings are an abuse of process because they have been commenced for the Fulcrum Purposes, Mineralogy's reliance on the other characteristics referred to in the passage at [84] above (namely oppression and bringing the administration of justice into disrepute) could not independently sustain an allegation of abuse of process. Without the alleged collateral purpose, for example, the sheer size and complexity of the litigation could not arguably be said to be unjustifiably oppressive to Mineralogy. The size and complexity of the substantive proceedings are par for the course for these parties.
Turning then to the parties' respective submissions on this application.
Summary of the parties' submissions
The parties' submissions may be broadly summarised under three headings. The first two arise from the Points of Claim as originally filed and were focused on the alleged abuse based on the collateral Fulcrum Purposes. The third arises from the reliance in the amended Points of Claim on the effect of the Port proceedings.
It is convenient to deal with the parties' submissions in relation to each issue.
Issue 1: is it necessary to show that the CITIC parties do not intend to prosecute the substantive proceedings?
The first issue that arises is whether, in circumstances in which it is alleged that a party has commenced an action for a collateral purpose, it is necessary for the party alleging an abuse of process to allege (and prove) that the party that has commenced the action has no intention to bring the action to a successful conclusion.
The CITIC parties present this issue as, essentially, a pure question of law; namely, that in the absence of an allegation and proof that the CITIC parties commenced the substantive proceedings with no intention to bring them to a successful conclusion, an application for a stay on the grounds that they are an abuse of process must be refused. There being no such allegation in the present case, the CITIC parties submit, the stay application is doomed to failure.
Mineralogy denies there is such a principle of law.
Issue 1 – CITIC parties' submissions
In relation to this issue, the CITIC parties identify, as the starting point, the High Court's decision in Williams v Spautz.[55] They submit that Williams v Spautz is (and has been consistently applied as) authority for the principle that a proceeding cannot be an abuse if the moving party intends to prosecute those proceedings to a conclusion.
[55] Williams v Spautz [1992] HCA 34; (1992) 174 CLR 509 (Williams v Spautz).
Williams v Spautz concerned criminal proceedings commenced by the respondent (Dr Spautz) that the trial judge found had been instituted and maintained for the predominant, improper purpose of exerting pressure on Dr Spautz's employer to reinstate him or to agree to a favourable settlement of his wrongful dismissal claim. The trial judge stayed the proceedings.
On appeal, the Court of Appeal concluded that the criminal proceedings, even if commenced for an improper purpose, should not be permanently stayed 'in the absence of some improper act in the prosecution of the process'.[56] The particular point upon which the appeal to the High Court turned was therefore relatively narrow. The High Court concluded that it was not necessary to show an 'improper act' as well as an 'improper purpose' and so allowed the appeal.[57]
[56] Williams v Spautz, 517 (Mason CJ, Dawson, Toohey & McHugh JJ).
[57] Williams v Spautz, 527 ‑ 529 (Mason CJ, Dawson, Toohey & McHugh JJ).
The majority of the Court, nevertheless, dealt more generally with the correct approach to determining whether an abuse of process can be said to arise from an improper purpose. It is this aspect of the decision upon which the CITIC parties focused.
In Williams v Spautz, the plurality (Mason CJ, Dawson, Toohey and McHugh JJ) dealt with this issue, first, by reference to the judgment of Lord Bridge in Goldsmith v Sperrings Ltd.[58] Their Honours said:[59]
Bridge LJ identified one difficulty when he said:
'What if a litigant with a genuine cause of action, which he would wish to pursue in any event, can be shown also to have an ulterior purpose in view as a desired by product of the litigation? Can he on that ground be debarred from proceeding? I very much doubt it.' (emphasis added)
So would we. But his Lordship, by implication, evidently sees no difficulty with the case in which the plaintiff does not wish to pursue his or her cause of action to a conclusion because he or she intends to use the proceedings for a collateral and improper purpose.
In our view, the power must extend to the prevention of an abuse of process resulting in oppression, even if the moving party has a prima facie case or must be assumed to have a prima facie case. Take, for example, a situation in which the moving party commences criminal proceedings. He or she can establish a prima facie case against the defendant but has no intention of prosecuting the proceedings to a conclusion because he or she wishes to use them only as a means of extorting a pecuniary benefit from the defendant. It would be extraordinary if the court lacked power to prevent the abuse of process in these circumstances.
[58] Goldsmith v Sperrings Ltd [1977] 1 WLR 478 (Goldsmith v Sperrings).
[59] Williams v Spautz, 522 (Mason CJ, Dawson, Toohey & McHugh JJ) (references omitted).
As is apparent, their Honours in this passage twice emphasised the moving party's 'wish' or 'intention' to bring the proceedings to a conclusion as a significant consideration.
The plurality returned to this issue in identifying what their Honours described as the 'reasonable bounds' of the concept of abuse of process. In doing so their Honours drew a distinction between ultimate purposes and immediate purposes. They said:[60]
To say that a purpose of a litigant in bringing proceedings which is not within the scope of the proceedings constitutes, without more, an abuse of process might unduly expand the concept. The purpose of a litigant may be to bring the proceedings to a successful conclusion so as to take advantage of an entitlement or benefit which the law gives the litigant in that event.
Thus, to take an example mentioned in argument, an alderman prosecutes another alderman who is a political opponent for failure to disclose a relevant pecuniary interest when voting to approve a contract, intending to secure the opponent's conviction so that he or she will then be disqualified from office as an alderman by reason of that conviction, pursuant to local government legislation regulating the holding of such offices. The ultimate purpose of bringing about disqualification is not within the scope of the criminal process instituted by the prosecutor. But the immediate purpose of the prosecutor is within that scope. And the existence of the ultimate purpose cannot constitute an abuse of process when that purpose is to bring about a result for which the law provides in the event that the proceedings terminate in the prosecutor's favour.
It is otherwise when the purpose of bringing the proceedings is not to prosecute them to a conclusion but to use them as a means of obtaining some advantage for which they are not designed or some collateral advantage beyond what the law offers. So, in Dowling, Isaacs J. pointed out that 'if, for instance, it had been shown that the Society had simply threatened Dowling that unless he did what they had no right to demand from him, namely, give up certain names, they would proceed to sequestration, and they had proceeded accordingly, there would have been in law an abuse of the process'. However, because the Society wished to use the process for the very purpose for which it was designed, there was no abuse of process.
[60] Williams v Spautz, 526 ‑ 527 (Mason CJ, Dawson, Toohey & McHugh JJ) (references omitted).
Justice Brennan, who was also in the majority in Williams v Spautz, was even more explicit as to the need for a party alleging an abuse to establish the absence of an intention to bring the proceedings to a successful conclusion. His Honour again did so by reference to the approach propounded by Lord Bridge in Goldsmith v Sperrings:[61]
I would formulate the test in this way: if there be a reasonable relationship between the result intended by the plaintiff and the scope of the remedy available in the proceeding, there is no abuse of process. If there be mixed purposes – some legitimate, some collateral – I would restate his Lordship's test that 'but for his ulterior purpose, (the plaintiff) would not have commenced proceedings at all'. So expressed, the test casts on the other party an onus of proving what the plaintiff would not have done if he had not formed the intention of obtaining a collateral advantage. That onus may be impossible to discharge. If that onus were discharged, the other party would establish that the plaintiff had not commenced or maintained the proceeding for any substantial legitimate purpose. The gravamen of the test, I apprehend, is that the plaintiff did not commence or maintain the proceeding for any substantial legitimate purpose. I would state the test in that way. Substantiality is a matter of degree, ascertained by reference to the intention attributed to the plaintiff in all the circumstances of the case. At the end of the day, the court must determine, by reference to the intention attributed to the plaintiff, not merely whether the collateral purpose of the proceeding outweighs any legitimate purpose but whether the plaintiff entertained any substantial intention that the proceeding should achieve a legitimate purpose.
[61] Williams v Spautz, 537 (Brennan J).
The CITIC parties refer to a number of decisions following Williams v Spautz which they submit confirm the necessity for a party alleging an abuse of process to allege an absence of intention to bring the action to a successful conclusion.
I need only refer to two decisions in this Court.
In Australian Electrical Electronics Foundry & Engineering Union, WA Branch v Hamersley Iron Pty Ltd,[62] Malcom CJ (Kennedy and Owen JJ agreeing) said at 148 ‑ 149:
In the context of abuse of process, Parker J said:
'A court will only be satisfied that proceedings constitute an abuse of process in exceptional or extreme cases: Walton v Gardiner (1993) 177 CLR 378 at 392. … If proceedings are brought for an improper purpose this may constitute an abuse of process, but only where the sole or dominant purpose of bringing them is not to prosecute them to a conclusion but to use them as a means of obtaining some collateral advantage beyond what the law offers; Williams v Spautz (1992) 174 CLR 509 at 522 and 529.'
It was not suggested by counsel for the appellants that the learned judge had not correctly stated the principle to be applied in this case. I would only add that, as Harper J said in Grimwade v State of Victoria (1997) 90 A Crim R 526 at 537:
'The onus of satisfying the court that there is an abuse of process lies upon the party alleging it. The onus is a heavy one. But that is not a matter of present concern. The question before me is whether or not the cause of action has been properly pleaded. This will not be so unless the statement of claim alleges material facts which, if proved, would together constitute each element of the tort. The extraneous purpose must be pleaded. Its impropriety must be made apparent. The fact that it was the predominant or the only predominant purpose must be alleged.'
[62] Australian Electrical Electronics Foundry & Engineering Union, WA Branch v Hamersley Iron Pty Ltd (1998) 19 WAR 145.
The CITIC parties, of course emphasise the reference in Parker J's formulation of the principle to the 'sole or dominant purpose of bringing [proceedings being] not to prosecute them to a conclusion'.
Secondly, in Armstrong v McIntosh [No 4],[63] Le Miere J rejected a plea of abuse, again emphasising the need to find that the plaintiff had no intention of bringing the matter to trial. His Honour said, referring to the passage from Brennan J's judgment in Williams v Spautz at [101] above:[64]
The defendant's case is that the predominant factor which led the plaintiff to bring this action is the plaintiff's desire and intention to attack and punish the defendant. Counsel for the defendant submitted that the evidence establishes that the plaintiff was determined to financially destroy the defendant and ruin his life. But the defendant did not establish, and indeed did not allege, that the plaintiff intended to achieve the defendant's destruction other than through the initiation and successful prosecution of the action. The defendant's defence must fail for the reasons stated by Brennan J in Williams v Spautz.
[63] Armstrong v McIntosh [No 4] [2020] WASC 31 (Armstrong v McIntosh [No 4]).
[64] Armstrong v McIntosh [No 4] [216] (Le Miere J).
Thus, the CITIC parties submit that in the absence of any allegation that they do not intend to prosecute the substantive proceedings to a successful conclusion, the stay application should be dismissed as unarguable.
Issue 1 – Mineralogy's submissions
In its submissions in relation to this issue, Mineralogy denies that the authorities relied upon by the CITIC parties require that the moving party allege and prove a lack of intention to bring the proceeding to a successful conclusion at trial.
In that regard Mineralogy lays significant emphasis on the principle, referred to at [84] above, that the doctrine of abuse of process cannot be confined to closed categories and emphasises the broader evaluative process for determining whether there is an abuse of process. It refers in particular to the observations of the plurality in UBS AG v Tyne,[65] made in the context of litigation raising issues that could, and should, have been litigated in earlier proceedings:[66]
Whether conduct of this description rises to the level of an abuse of the processes of the court is a determination that requires consideration of all the circumstances. As Lord Bingham of Cornhill explained, that consideration requires the court to make:
'a broad, merits‑based judgment which takes account of the public and private interests involved and also takes account of all the facts of the case, focusing attention on the crucial question whether, in all the circumstances, a party is misusing or abusing the process of the court by seeking to raise before it the issue which could have been raised before. As one cannot comprehensively list all possible forms of abuse, so one cannot formulate any hard and fast rule to determine whether, on given facts, abuse is to be found or not.'
[65] UBS AG v Tyne [2018] HCA 45; (2018) 265 CLR 77 (UBS AG v Tyne).
[66] UBS AG v Tyne [7] (Kiefel CJ, Bell & Keane JJ) (references omitted).
In this regard, Mineralogy submitted that its stay application was broader than that in Williams v Spautz so could not be confined to the particular category dealt with in that case. It described the broader issue raised by the stay application as[67]
whether a proceeding is an abuse of process if it forms but one of a number of proceedings commenced or made necessary by a strategy of the plaintiffs to vex and exert pressure on Mineralogy so that it agrees (or is forced to agree) to amend the contractual relationship between the parties – has not been definitively resolved by an appellate court in this country. Any principles derived from Williams and its like cases do not delimit the universe of principles applicable to the Stay Summons.
[67] Mineralogy's Written Submissions [41].
Thus, Mineralogy invoke what it describes as the larger 'overarching strategy' alleged in the Points of Claim, submitting that it is well open on the state of existing authority for the substantive proceedings to be an abuse of process even if the CITIC parties intend to prosecute it to a conclusion, where the proceeding nonetheless would not have been commenced in the absence of that overarching strategy.[68]
[68] Mineralogy's Written Submissions [49].
In this context, Mineralogy also emphasise the principle that an alleged improper purpose need not be the sole purpose, but only the predominant purpose of the substantive proceedings;[69] and that the improper purpose may well amount to an abuse if the parties' intention is not to prosecute the claim for the purpose of obtaining relief, but to wear the party down through successive litigation.[70]
[69] Mineralogy's Written Submissions [55] ‑ [57].
[70] Mineralogy's Written Submissions [63].
Mineralogy submits that with the 'documents and circumstances presently known' to it giving rise to a sufficiently arguable case of abuse of process, it should therefore be afforded the opportunity to fully ventilate its stay application, including through appropriate use of procedural mechanisms.[71]
[71] Mineralogy's Written Submissions [94].
This leads conveniently to the second broad issue in the application whether there is a sufficiently arguable basis on the material available, to contend that the substantive proceedings have been brought as part of the Fulcrum Purposes.
Issue 2: is it arguable that the substantive proceedings have been improperly brought as part of the Fulcrum Purposes?
The CITIC parties contend, in the alternative, that the matters raised in the Points of Claim, and in particular the matters set out at [54] above, are incapable of giving rise to a finding that the substantive proceedings have been commenced for the Fulcrum Purposes.[72]
Issue 2 – CITIC parties' submissions
[72] Plaintiff's' Amended Outline of Submissions – Summary Dismissal or Strike Out of Permanent Stay Application dated 9 March 2021 (CITIC Parties' Written Submissions) [20].
The CITIC parties addressed each of the matters identified by Mineralogy as matters from which the Fulcrum Purposes may be inferred.[73] In relation to each matter, the CITIC parties submitted that it did not provide any support for the existence of the Fulcrum Purposes. I will not set out those submissions, but rather deal with each of the matters when coming to my own conclusions.
[73] Points of Claim [35(e)].
There are, however, some broad submissions made by the CITIC parties that it is appropriate to refer to at this point.
First, the CITIC parties submitted, in relation to whether a purpose was illegitimate or improper, that it was not an improper or collateral purpose that a party, such as the CITIC parties, might wish to reach a settlement with Mineralogy, part of which may extend beyond the relief that they might obtain at trial. Again, the CITIC parties refer to Lord Bridge's judgment in Goldsmith v Sperrings as to what is meant by a 'collateral advantage':[74]
The phrase manifestly cannot embrace every advantage sought or obtained by a litigant which it is beyond the court's power to grant him. Actions are settled quite properly every day on terms which a court could not itself impose on an unwilling defendant. An apology in libel, an agreement to adhere to a contract of which the court could not order specific performance, an agreement after obstruction of an existing right of way to grant an alternative right of way over the defendant's land – these are a few obvious examples of such proper settlement. In my judgment, one can certainly go so far as to say that when a litigant sues to redress a grievance no object which he may seek to obtain can be condemned as a collateral advantage if it is reasonably related to the provision of some form of redress for that grievance.
[74] Goldsmith v Sperrings, 503 (Bridge LJ).
So too, the CITIC parties submit that the Contract 'Normalisation' Objective pleaded in the Points of Claim is not an illegitimate or improper purpose or objective per se. That is, there is nothing improper about a party to a contract desiring, or seeking, to renegotiate the terms of that contract to its perceived advantage. This must surely be correct. Nor did Mineralogy suggest otherwise.[75] It is the improper use of legal proceedings for that purpose, and not for the purpose of a genuine claim for relief that is what, on Mineralogy's case, gives rise to the abuse of process.
[75] ts 487.
Secondly, insofar as Mineralogy seeks to rely upon previous litigation in support of its contention as to the existence of the Fulcrum Purposes (see [56] above), the CITIC parties submitted that the litigation referred to by Mineralogy in the Points of Claim presents an incomplete picture of the litigious landscape over the past decade.
In that regard the CITIC parties provided a spreadsheet of 29 substantive actions and appeals commenced between the parties since 2012, which they colour‑coded to demonstrate 'wins' and 'losses'. That spreadsheet was said to demonstrate that the overwhelming majority of the litigation over that time has been commenced by Mineralogy and that the CITIC parties have, in the majority of cases, been the successful party. From this summary the CITIC parties appear to pose the rhetorical question: 'just who is vexing who with all this litigation?'
Thirdly, in relation to the substantive proceedings themselves, the CITIC parties point to the significant steps that have been undertaken to bring the matter to trial, since it was commenced in October 2018, including mediation, a successful strike out application of portions of the Defence and extensive discovery. The history of the substantive proceedings, as identified by the CITIC parties, is set out in the Schedule to these reasons.
These steps, and the CITIC parties' desire to bring the substantive proceedings to trial, the CITIC parties submit belie the existence of any abuse of process.
Issue 2 – Mineralogy's submissions
Again, Mineralogy addressed each of the matters identified by it[76] as matters from which it submitted the Fulcrum Purposes may arguably be inferred. I will again defer reference to those matters until I come to my own conclusions.
[76] Points of Claim [35(e)].
As to the genuineness of the CITIC parties in bringing the substantive proceedings, Mineralogy submitted that the material it relied upon supported, at least arguably, its position that the substantive proceedings were commenced without a genuine belief by the CITIC parties in their entitlement to relief. In addition to the general inferences it sought to draw as to the Fulcrum Purposes from the matters set out at [54] above, two additional submissions made by Mineralogy warrant particular mention.
First, Mineralogy submitted that there was a conspicuous absence of any affidavit evidence from the CITIC parties as to the genuineness of its belief in its claim.[77]
[77] ts 427, 463.
Secondly, as I have noted above, Mineralogy submitted that the nature of the claims made by the CITIC parties in the substantive proceedings demonstrated that they were not genuine. That submission was put with varying degrees of hyperbole. For example, in its written submissions Mineralogy submitted:[78]
As is demonstrated in these submissions and the evidence led by Mineralogy, these very proceedings are an abuse of process because they facially seek to sterilise Mineralogy's other valuable mining tenements; confound the evident commercial intent of the sophisticated contractual arrangements the parties agreed to; and render the plaintiffs the one and only miner that Mineralogy must sell its other rights to, the other tenements having been rendered unsaleable and unusable by Mineralogy as a miner. Obviously, relief like that would never be granted and the motivation of the plaintiffs is to vex and harass Mineralogy by long and expensive litigation with the threat of such extreme relief.
[78] Mineralogy's Written Submissions [6].
Mineralogy's submissions as to the 'obviousness' that the relief claimed by the CITIC parties would never be granted was based on opinions expressed by a geologist employed by Mineralogy, Mr Christopher Spielvogel, as to the practical impact that the approval of the 2017 MCPs and the other relief claimed by the CITIC parties would have on Mineralogy's other mining rights in the area covered by the State Agreement.[79]
[79] Exhibit M (Affidavit of Christopher Spielvogel sworn 7 April 2021).
In this regard, in the week prior to the hearing before me, Mineralogy filed an affidavit of Mr Spielvogel sworn 7 April 2021. The CITIC parties initially took objection to the affidavit on the basis that it contained contentious material that was ultimately a matter for trial.[80]
[80] ts 325 ‑ 326.
I received Mr Spielvogel's affidavit into evidence on the application, on the basis that it identified, at least in part, Mineralogy's contentions in relation to the substantive proceedings. The evidence was received on the express basis that the evidence was contentious and was simply, from Mineralogy's perspective, for the purpose of demonstrating that there was a triable issue.[81]
[81] ts 431 ‑ 432.
It is appropriate to set out some of the critical aspects of Mr Spielvogel's affidavit.
In that context, as observed above, among the changes proposed by the 2017 MCPs is an increase in infrastructure associated with the extraction operations on the Sino Iron leases, including tailings and waste capacity on associated tenements and an increase in the capacity of existing stockpiles and associated infrastructure at the Port (see [27] above).
A useful illustration of the changes proposed by the 2017 MCPs can be seen depicted in Appendix B, Plan 1 of the 2017 MCPs:[82]
[82] Exhibit M, page 50 (detail).
On this plan, the boundaries of the tenements are depicted in yellow. The Sino Iron leases are the three rectangular shaped areas on the western side of the lower portion of the plan. The existing areas of Approved Proposals are depicted in green. As can be seen, those green areas include an area to the north east of the Sino Iron leases (being tailings storage facilities) and areas in the north at Cape Preston, where the existing Port facilities are situated.
The blue areas on the plan depict the additional areas the subject of the 2017 MCPs. As can be seen, those areas include additional areas to the north and south of the existing tailings storage facilities (being new tailings and waste capacity). They also include additional areas at the Port (most clearly to the east and the south of the existing (green) areas at the Port).
As part of the relief they claim, the CITIC parties seek Mineralogy's agreement to expand the Site Lease Area under the MRSLAs (see [32] and [35] above). As can be seen from Annexure 11 to the Statement of Claim, that expanded area essentially consists of the areas (in blue and green in the plan at [133] above) that would follow from the approval of the 2017 MCPs:[83]
[83] Exhibit M, page 18 (detail).
It is the extent of the proposed expanded Site Lease Area, in particular, that forms the basis for various opinions expressed by Mr Spielvogel as to the impact that the relief claimed by the CITIC parties would have on Mineralogy. For example, Mr Spielvogel proffers the following opinions:[84]
In my opinion, converting some areas of share services into the CITIC Proposed Expanded [Site Lease Area] and the associated facilities under the MCPs will greatly diminish; if not eliminate the ability for any third party to access the port area by reason of the sole occupation and exclusive use component of the CITIC Proposed Expanded [Site Lease Area], with flow on effects detrimental for the mining leases to the North and to the South of mining leases M08/123 to M08/125.
[84] Exhibit M (Affidavit of Christopher Spielvogel sworn 7 April 2021) [36].
Similarly, Mr Spielvogel says, in relation to facilities constructed near the port terminal:[85]
If the areas coloured in red [on Annexure 11 of the Statement of Claim] were to become Site Lease Area under the MRSLAs and for the CITIC Plaintiffs' exclusive occupation, the facilities of third parties … could not be constructed.
There would be insufficient space available outside the CITIC Proposed Expanded [Site Lease Area] to enable the construction of those third party facilities in locations proximate to the port.
A reason for the inability to construct the facilities is that the area at the port of Cape Preston is very space constrained. There is scarce area available for utilisation for facilities and infrastructure.
[85] Exhibit M (Affidavit of Christopher Spielvogel sworn 7 April 2021) [101] ‑ [103].
In the application before me, Mineralogy submitted that Ms Rifici's evidence 'firmly establishes in terms the Fulcrum Purposes'.[173] In my view, it did no such thing. At its very highest, Ms Rifici's evidence might be said to support the existence of the Contract 'Normalisation' Objective. But, as I have repeatedly emphasised, there is a large gulf between the Contract 'Normalisation' Objective and the Fulcrum Purposes.
[173] Mineralogy's Written Submissions [83].
In particular, Ms Rifici did not say, nor indeed was she asked, whether the Fulcrum Group had, as one of its purposes[174]
to engage legal processes … not for the purpose of vindicating any legal right or defence at law or complaint about a loss or injury bona fide held, but rather to achieve a collateral purpose being the Contract 'Normalisation' Objective …
[174] See [52] above.
Of course Mineralogy, quite properly, emphasised that Martin J's rejection of the sinister inferences sought to be drawn concerning the Fulcrum Group was based upon the 'limited evidence' in the SRF proceedings and that 'an issue of possible concern about such objectives might emerge, if some illegitimate or unlawful means had been suggested or resolved upon to further that end'.[175]
[175] See SRF Decision [212] Martin J.
Mineralogy submits that the Points of Claim squarely raise illegitimate or unlawful means on the footing of evidence not before Martin J.[176]
[176] Mineralogy's Written Submissions [83].
It will be apparent that, in my view, the Points of Claim do not, either individually or collectively, arguably support such illegitimate or unlawful means. In my view, the matters relied upon by Mineralogy in support of the Fulcrum Purposes do not reveal a reasonably arguable case that the substantive proceedings have been commenced for collateral purposes. They certainly do not reveal a case sufficiently arguable to justify the time, expense and delay that would be occasioned by embarking on what would, in effect, be an interlocutory trial as to the CITIC parties' litigation strategy over the past decade.
Conclusions as to permanent stay
In light of the forgoing, I conclude that there is no reasonably arguable basis to contend that the substantive proceedings should be stayed as an abuse of process, sufficient to justify the further hearing of the stay application.
In summary, there is no basis upon which it can reasonably be argued that the CITIC parties have brought the substantive proceedings with no genuine belief in the claims or that they do not intend to prosecute the substantive proceedings to a successful conclusion.
Nor, in my view, is there a reasonably arguable basis to contend that the matters identified in the Points of Claim support an inference that the CITIC parties have been conducting litigation for improper and collateral purposes. Mineralogy's allegation as to the existence of the Fulcrum Purposes is, as I have said, a serious one and I have treated it seriously. In the end, however, having fully considered all of the matters identified by Mineralogy, I have concluded that there is no substance to the allegation.
Not only do I find that there is no reasonable basis for the allegation of the Fulcrum Purposes generally, for the purposes of the stay application it would be necessary for the Court to be satisfied that these particular proceedings (i.e. the substantive proceedings) have been brought for the Fulcrum Purposes. There is no basis for that contention whatsoever. In my view, the substantive proceedings have been brought for the purposes of seeking the relief claimed by the CITIC parties. Whether the CITIC parties will be successful in obtaining any, or all, of that relief is a different matter.
In all of the circumstances, the stay application has insufficient prospects of success to justify the time, expense and delay that would be required for a 'full hearing' of all of the matters sought to be raised by Mineralogy. It would not be in the interests of justice to delay the substantive proceedings further and to divert the parties and the resources of the Court by such an interlocutory hearing.
For these reasons Mineralogy's application for a permanent stay must be summarily dismissed.
It remains then for me to consider Mineralogy's alternative claim that the substantive proceedings be stayed and the statement of claim be struck out to the extent it raises matters the subject of issue, Anshun or abuse of process estoppels arising by reason of the Port proceedings.
Conclusion as to alternative relief (Port proceedings)
I am firmly of the view that the Port proceedings do not, independently, give rise to an arguable basis for the Court to grant a stay of the substantive proceedings, even to the limited extent claimed in the alternative relief sought in [76A] of the Points of Claim or to strike out any part of the Statement of Claim on that basis.
There are two reasons for that conclusion.
First, I do not consider that the Port proceedings, even arguably, determined, as between the parties, any issue of construction of the Facilities Deeds in a manner that is sought to be challenged or undermined in the substantive proceedings.
In that regard, properly understood, the Port proceedings did not hold that there was an unconstrained entitlement to third party use of the facilities constructed at the Port by the CITIC parties leaving space for further facilities to be developed separately in the future. Even less did Edelman J (or the Full Court) in the Port proceedings determine that to be the case as a matter of construction of the Facilities Deed.
That contention, which was central to Mineralogy's submissions on this point, follows, in my respectful view, from a misreading of [292] and [293] of Edelman J's reasons in Mineralogy (No 6). His Honour was not, in those passages, identifying rights of third parties arising under the Facilities Deeds (or elsewhere). Rather, his Honour was identifying the two possible ways in which, theoretically, third parties might use facilities within the area of General Purpose Lease 08/52.
When his Honour identified that one possible way that that 'could' occur was by the development of the facilities by the CITIC parties in such a way that third parties also built facilities in the area,[177] his Honour was not there referring to a right for third parties to do so. Rather, his Honour was there identifying some of the background context in which the Facilities Deeds operated.
[177] That is, in the first sentence of Mineralogy (No 6) [293]; see [154] above.
In truth, the right (or entitlement) of third parties to build facilities at Cape Preston was not an issue in the Port proceedings. Indeed, the only facilities that were in contemplation, and that were the subject of the Port proceedings, were facilities built by the CITIC parties. The issue to which the Port proceedings were directed was as to the control and ownership of those facilities and whether they were, as Mineralogy contended, vested in Mineralogy.
The question of construction of the Facilities Deeds that was resolved by the Port proceedings was that the Facilities Deeds did not confer on Mineralogy ownership or possession of the facilities constructed by the CITIC parties, unless and until those facilities became Shared Facilities.[178] Given that there was no evidence of a third party operation in existence, whether (and in what way) any of the CITIC parties' facilities would become Shared Facilities was not resolved by the Port proceedings.[179]
[178] See [146] ‑ [149] above.
[179] See [155] above.
None of these conclusions relate to an entitlement for third parties to build facilities at Cape Preston, nor are those conclusions challenged in the substantive proceedings.
In this context, of course, it may be recognised that the Facilities Deeds (all six of them) recognise that facilities may be built in the area the subject of the Facilities Deeds by persons other than the party to each Deed (i.e. the Company). Indeed, that would appear to be an obvious consequence of the fact that there are six identical deeds enabling different parties (i.e. the Company under each Deed) to obtain the approval of Mineralogy for them to build facilities. The rights of each party to the Facilities Deeds to actually build facilities is controlled by the Facilities Deeds themselves. The metes and bounds of the capacity for third parties to build facilities in the Preston Area was simply not an issue in the Port proceedings.
To that end, and in light of that background, the Facilities Deeds enable Mineralogy to impose conditions on development proposals in contemplation of future use by Mineralogy or third parties (cl 3.3(a)). They also, as I have also observed, make provision for Company Facilities to become Shared Facilities. It may be that the creation of such Shared Facilities (including facilities constructed by the CITIC parties) will yet come to pass.
In this regard, it is notable that the Points of Claim in relation to the Port proceedings describe the alleged inconsistency between the Port proceedings and the relief sought in the substantive proceedings not as relating to a legal conclusion, or even a factual finding, but as arising from the 'practical outcome' sought to be achieved 'namely exclusive use of the Port for [the CITIC parties]'.[180]
[180] See [63] above.
As I have discussed at [199] to [205] above, however, it is by no means self‑evident that the effect of the substantive proceedings would be to give the CITIC parties 'exclusive use of the Port'. It is clear that the extent to which the relief sought by the CITIC parties would affect the capacity or ability of other users to conduct operations from the Port is a matter of factual and legal complexity that cannot be resolved in a summary way. Nor is there any aspect of the Statement of Claim that could be 'struck out' by reason of the Port proceedings.
As I have said, the CITIC parties accepted, before me, that Mineralogy's Defence in the substantive proceedings raised those issues as a basis upon which the CITIC parties should be denied the relief claimed.[181] The extent to which it could be said, even in a practical sense, that effect of the relief sought in substantive proceedings would be to give the CITIC parties 'exclusive use of the Port' is therefore properly a matter for trial.
[181] See [196] above.
Which brings me to the second reason why the Port proceedings do not, independently, give rise to an arguable basis for the Court to grant a stay of the substantive proceedings, by reason of some form of estoppel.
That is because the issues raised by Mineralogy as to the effect of the Port proceedings, even to the extent that they raise a triable issue, are not matters that could justify the remedy of a stay of proceedings. As the plurality said in Lunt, a stay of proceedings is a remedy reserved for cases where the alleged abuse cannot be remedied in any other way. Their Honours said:[182]
In cases where proceedings are brought for an improper purpose, 'no remedy is likely to be appropriate other than a stay of the proceedings' because, in such cases, the abuse of the court's processes cannot be remedied in any other way. But where a court is able, by means less draconian than summary termination, to cure any apprehended prejudice to a fair trial so as to ensure that justice is done, the court's responsibility to the parties, and to the community, requires that those other means be deployed so that the matter before the court is heard and determined in accordance with the justice of the case. So, for example, where a party has engaged in sharp practice apt to delay the fair trial of a matter, an order for costs may be sufficient to cure the prejudice to the other party. Where a party's misconduct amounts to a contempt of court, such as the destruction of material evidence, the vindication of the court's authority may require the punishment of the miscreant. The remedy of a stay of proceedings, however, is concerned not with the punishment of the miscreant but with the protection of the integrity of the court's ability fairly and justly to determine the matter in dispute.
[182] Lunt [20] (Kiefel CJ, Gageler, Keane & Gordon JJ).
Having rejected Mineralogy's case that the substantive proceedings are brought for an improper purpose, the issues raised by Mineralogy in relation to the effect of the Port proceedings are at best matters to be addressed by means other than a stay of the proceedings. As the High Court said in Lunt, the Court's responsibility to the parties, and to the community, requires that those other means be deployed so that the matter before the court is heard and determined in accordance with the justice of the case.
Mineralogy contended at the hearing before me that the estoppel issue said to arise from the Port proceedings 'can't go away' and will have to be dealt with.[183] That may well be the case. In that context Mineralogy raised the prospect of the issue otherwise being dealt with in advance of trial.[184] It will be apparent from what I have said that I have real doubt that that would be appropriate, or even possible.
[183] ts 318, 394, 493 ‑ 494.
[184] ts 394.
Be that as it may, it is clear, in my view, that the issues raised in relation to the Port proceedings do not provide an arguable basis for staying the substantive proceedings, even in part. Nor do they raise any aspect of the Statement of Claim that could be 'struck out'. If it is suggested that there is some proper way of addressing discrete issues in the substantive proceedings in advance of trial, that is for another application on another day.
For these reasons, I also conclude that Mineralogy's alternative claim in the Points of Claim should be summarily dismissed.
Conclusion
At the commencement of these reasons, I observed that the issue before me concerned whether Mineralogy has an arguable basis for opening up another front in the ongoing battles between it and the CITIC parties.
To do so would be to embark upon a drawn out interlocutory process that would not resolve a substantive dispute between the parties and, indeed, would be directed to whether the CITIC parties should be prevented from having its substantive claim determined at all.
I am satisfied that Mineralogy has been given a full opportunity to demonstrate that there is a reasonable basis for embarking upon that course, rather than proceeding with the determination of the substantive dispute between the parties on its merits. In my view, Mineralogy has not demonstrated that there is a reasonably arguable case for the Court to exercise its exceptional jurisdiction to stay the substantive proceedings in whole or in part.
I am comfortably satisfied that it would not be in the interests of justice and would not best ensure the attainment of the objects set out in O 1 r 4A and r 4B, for the stay application to be the subject of any further hearing and that it should be summarily dismissed. The substantive proceedings should not be further delayed by, or the Court's resources be further devoted to, the stay application.
The stay application will be dismissed.
Schedule
List of steps taken in the substantive proceedings
| Date | Description | Party taking step |
| WAD 471 of 2018 (Federal Court) | ||
| 23 October 2018 | Originating application filed | Applicants (Plaintiffs) |
| 23 October 2018 | Statement of Claim filed | Applicants (Plaintiffs) |
| 31 October 2018 ‑ 14 November 2018 | Notice of address for service filed | Respondents (Defendants) |
| 16 November 2018 | Interlocutory application for the proceeding to be transferred to the Supreme Court filed | First Respondent (First Defendant) |
| 28 February 2019 | Defence filed | First and Second Respondents (First and Second Defendants) |
| Orders in relation to discovery conferral made on 18 March 2019 | ||
| 28 March 2019 | Reply filed | Applicants (Plaintiffs) |
| Order made transferring proceedings to the Supreme Court on 17 May 2019 | ||
| CIV 1915 of 2019 (Supreme Court) | ||
| 23 May 2019 | Request that the matter be admitted to the CMC List | Plaintiffs |
| Order admitting the proceedings to the CMC List of Justice Kenneth Martin and other procedural orders made on 10 June 2019 | ||
| 31 July 2019 | Notice of change of representation filed | Second Defendant |
| Strategic conference held on 16 August 2019. Orders made in relation to the filing of amended defences and mediation. | ||
| 6 September 2019 | Amended Defence filed | First Defendant |
| 6 September 2019 | Amended Defence filed | Second Defendant |
| 23 September 2019 | Reply to Amended Defences filed | Plaintiffs |
| Parties attended a mediation before Registrars S and C Boyle on 16 and 24 October and 18 November 2019 | ||
| 18 February 2020 | Notice of change of representation filed | Second Defendant |
| Directions hearing held on 25 February 2020. Orders in relation to amended pleadings, conferral regarding discovery categories and timing of discovery and orders in relation to a potential strike‑out or summary judgment application (by either party) made. | ||
| 10 March 2020 | Further Amended Defence filed | First Defendant |
| 10 March 2020 | Further Amended Defence filed | Second Defendant |
| Directions hearing held on 19 March 2020. Orders in relation to conferral regarding discovery categories and timing of discovery and orders in relation to a potential strike‑out or summary judgment application (by either party) made. | ||
| 23 March 2020 | Reply to Further Amended Defences filed | Plaintiffs |
| 24 April 2020 | Chamber summons for strike‑out of part of the First Defendant's Further Amended Defence filed | Plaintiffs |
| 24 April 2020 | Chamber summons for extension of time under orders made 19 March 2020 filed | First and Second Defendants |
| Special appointment held on 5 May 2020. Extension and variation orders to the orders made 19 March 2020 were made. | ||
| Special appointment held on 18 May 2020 to hear Plaintiff's application for strike‑out of the First Defendant's Further Amended Defence | ||
| 18 May 2020 | Discovery categories table filed (Note: an updated discovery categories table was filed on 19 May 2020) | Plaintiffs |
| Directions hearing held on 20 May 2020. Discovery orders and orders in relation to conferral regarding particulars of loss and damage were made. | ||
| 28 August 2020 | Further particulars of loss and damage filed | Plaintiffs |
| Judgment in relation to Plaintiffs' application for strike‑out of part of the First Defendant's Further Amended Defence delivered on 1 September 2020. Orders made in relation to that application on 3 September 2020. | ||
| 3 September 2020 | Minute of proposed orders filed in which the First and Second Defendants sought an order that the parties confer regarding the effect of the Iron Ore Processing (Mineralogy Pty Ltd) Agreement Amendment Act 2020 (WA) on the proceeding, including the question of whether the proceeding has been terminated. | First and Second Defendants |
| Directions hearing held on 3 September 2020. Orders in relation to loss and damage discovery made. | ||
| 17 September 2020 | Second Further Amended Defence filed | First Defendant |
| 1 October 2020 | Reply to Second Further Amended | Plaintiffs |
| 16 October 2020 | Plaintiffs' list of documents, by way of the first tranche of discovery, provided | Plaintiffs |
| 20 November 2020 | First Defendant's list of documents provided | First Defendant |
| 26 November 2020 | Plaintiffs' revised list of documents, by way of the first tranche of discovery, provided | Plaintiffs |
| Directions hearing held on 27 November 2020. Orders in relation to discovery and the First and Second Defendants' permanent stay application made. | ||
| 14 December 2020 | Affidavit of Kane Christopher Jones verifying list of documents filed | First Defendant |
| 24 December 2020 | Plaintiffs' second tranche of discovery provided | Plaintiffs |
| 5 January 2021 | Chamber summons and points of claim for permanent stay application filed | First and Second Defendants |
| 27 January 2021 | Affidavits of Geoffrey Stephen Smith and Kane Christopher Jones filed in support of permanent stay application filed | First and Second Defendants |
| 23 February 2021 | Plaintiffs' third tranche of discovery provided | Plaintiffs |
| Directions hearing held on 24 February 2021. Orders in relation to discovery and the First and Second Defendants' permanent stay application. | ||
I certify that the preceding paragraphs comprise the reasons for decision of the Supreme Court of Western Australia.
LH
Research Associate to the Honourable Chief Justice Quinlan
28 MAY 2021
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