Southern Cross Pipelines Australia Pty Ltd v Kenneth Comninos Michael Western Australian Independent Gas Pipelines Access Regulator
[2002] WASC 149
SOUTHERN CROSS PIPELINES AUSTRALIA PTY LTD & ORS -v- KENNETH COMNINOS MICHAEL WESTERN AUSTRALIAN INDEPENDENT GAS PIPELINES ACCESS REGULATOR & ANOR [2002] WASC 149
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2002] WASC 149 | |
| Case No: | CIV:2904/2001 | 3 MAY 2002 | |
| Coram: | EM HEENAN J | 12/06/02 | |
| 37 | Judgment Part: | 1 of 1 | |
| Result: | Application by external party seeking to be joined as an additional defendant refused | ||
| B | |||
| PDF Version |
| Parties: | SOUTHERN CROSS PIPELINES AUSTRALIA PTY LTD (ACN 084 521 997) SOUTHERN CROSS PIPELINES (NPL) AUSTRALIA PTY LTD (ACN 085 991 948) DUKE ENERGY WA POWER PTY LTD (ACN 058 070 689) KENNETH COMNINOS MICHAEL WESTERN AUSTRALIAN INDEPENDENT GAS PIPELINES ACCESS REGULATOR THE STATE OF WESTERN AUSTRALIA |
Catchwords: | Parties Application by stranger to be joined Challenge by plaintiffs to draft decision on Reference Tariffs for gas access under Gas Pieplines Access (Western Australia) Act 1998 Plaintiffs relying on Goldfields Gas Piplines Agreement Act 1994 for protection from Regulator's draft decision Applicant a consumer of gas under a separate contract Insufficiency of interests to require joinder |
Legislation: | Gas Pipelines Access (Western Australia) Act 1998 Goldfields Gas Pipeline Agreement Act 1994 Government Agreements Act 1979 Rules of the Supreme Court, O 18 r 6(2) |
Case References: | AG v Pontypridd Waterworks Co [1908] 1 Ch 388 Australian Competition and Consumer Commission v News Corporation Ltd (1997) 79 FCR 117; 160 ALR 151 Australian Oil Exploration Ltd v Lachberg (1958) 101 CLR 119 Australian Tape Manufacturers Association Ltd v Commonwealth (1990) 94 ALR 641 Boral Resources (Vic) Pty Ltd v Robak Engineering & Construction Pty Ltd [1992] 2 VR 507 BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266 Bredvica v Radulovic [1975] VR 434 Commonwealth Aluminium Corporation Ltd v Attorney General [1976] Qd R 231 Emory University v Biochem Pharma Inc (1998) 86 FCR 1; 157 ALR 371 Foxe v Brown (1984) 58 ALR 542; 59 ALJR 186 Gregg v Tasmanian Trustees Ltd (1977) 73 FCR 91; 143 ALR 328 Homestyle Pty Ltd v City of Belmont & Anor [1999] WASCA 59 Hospital Products Ltd v United States Surgical Corporation (1984) 156 CLR 41 Kendall v Hamilton (1879) 4 App Cas 504 Lancaster Banking Co v Cooper (1879) 9 Ch D 594 News Ltd v Australian Rugby Football League Ltd (1996) 64 FCR 410 O'Keefe v Williams (1910) 11 CLR 171 Pegang Mining Co Ltd v Choong Sam (1969) 2 MLJ 52 Secured Income Real Estate (Australia) Ltd v St Martins Investments Pty Ltd (1979) 144 CLR 579 South Eastern Drainage Board v The Savings Bank of South Australia (1939) 62 CLR 603 Spelling Goldberg Productions Inc v BPC Publishing Ltd [1981] RPC 280 CA Tetra Molectric Ltd v Japan Imports Ltd [1976] RPC 541 The Queen v The Australian Broadcasting Tribunal Ex parte Hardiman (1980) 144 CLR 13 Tollfus Mieg Et Compagnie SA v Bank of England [1951] Ch 33 Vandervell Trustees Ltd v White [1971] AC 912 Walker v Commonwealth Trading Bank of Australia (1985) 3 NSWLR 496 Willow Grange Pty Ltd v Yarra City Council, [1998] ANZ Conv R 415 Vic CA Morrell v Mercantile Mutual Insurance (Australia) Ltd (1999) 21 WAR 451 TXU Electricity Ltd v The Office of the Regulator General [2001] VSC 4 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CIVIL
- First Plaintiff
SOUTHERN CROSS PIPELINES (NPL) AUSTRALIA PTY LTD (ACN 085 991 948)
Second Plaintiff
DUKE ENERGY WA POWER PTY LTD (ACN 058 070 689)
Third Plaintiff
AND
KENNETH COMNINOS MICHAEL WESTERN AUSTRALIAN INDEPENDENT GAS PIPELINES ACCESS REGULATOR
First Defendant
THE STATE OF WESTERN AUSTRALIA
Second Defendant
(Page 2)
Catchwords:
Parties - Application by stranger to be joined - Challenge by plaintiffs to draft decision on Reference Tariffs for gas access under Gas Pieplines Access (Western Australia) Act 1998 - Plaintiffs relying on Goldfields Gas Piplines Agreement Act 1994 for protection from Regulator's draft decision - Applicant a consumer of gas under a separate contract - Insufficiency of interests to require joinder
Legislation:
Gas Pipelines Access (Western Australia) Act 1998
Goldfields Gas Pipeline Agreement Act 1994
Government Agreements Act 1979
Rules of the Supreme Court, O 18 r 6(2)
Result:
Application by external party seeking to be joined as an additional defendant refused
Category: B
(Page 3)
Representation:
Counsel:
First Plaintiff : Mr M J Buss QC & Mr A G Castledine
Second Plaintiff : Mr M J Buss QC & Mr A G Castledine
Third Plaintiff : Mr M J Buss QC & Mr A G Castledine
First Defendant : No appearance
Second Defendant : Ms J C Pritchard
Non Party : Mr C L Zelestis QC & Mr G H Murphy
Solicitors:
First Plaintiff : Minter Ellison
Second Plaintiff : Minter Ellison
Third Plaintiff : Minter Ellison
First Defendant : Corrs Chambers Westgarth
Second Defendant : Crown Solicitor
Non Party : Clayton Utz
Case(s) referred to in judgment(s):
AG v Pontypridd Waterworks Co [1908] 1 Ch 388
Australian Competition and Consumer Commission v News Corporation Ltd (1997) 79 FCR 117; 160 ALR 151
Australian Oil Exploration Ltd v Lachberg (1958) 101 CLR 119
Australian Tape Manufacturers Association Ltd v Commonwealth (1990) 94 ALR 641
Boral Resources (Vic) Pty Ltd v Robak Engineering & Construction Pty Ltd [1992] 2 VR 507
BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266
Bredvica v Radulovic [1975] VR 434
Commonwealth Aluminium Corporation Ltd v Attorney General [1976] Qd R 231
Emory University v Biochem Pharma Inc (1998) 86 FCR 1; 157 ALR 371
Foxe v Brown (1984) 58 ALR 542; 59 ALJR 186
Gregg v Tasmanian Trustees Ltd (1977) 73 FCR 91; 143 ALR 328
Homestyle Pty Ltd v City of Belmont & Anor [1999] WASCA 59
Hospital Products Ltd v United States Surgical Corporation (1984) 156 CLR 41
(Page 4)
Kendall v Hamilton (1879) 4 App Cas 504
Lancaster Banking Co v Cooper (1879) 9 Ch D 594
News Ltd v Australian Rugby Football League Ltd (1996) 64 FCR 410
O'Keefe v Williams (1910) 11 CLR 171
Pegang Mining Co Ltd v Choong Sam (1969) 2 MLJ 52
Secured Income Real Estate (Australia) Ltd v St Martins Investments Pty Ltd (1979) 144 CLR 579
South Eastern Drainage Board v The Savings Bank of South Australia (1939) 62 CLR 603
Spelling Goldberg Productions Inc v BPC Publishing Ltd [1981] RPC 280 CA
Tetra Molectric Ltd v Japan Imports Ltd [1976] RPC 541
The Queen v The Australian Broadcasting Tribunal Ex parte Hardiman (1980) 144 CLR 13
Tollfus Mieg Et Compagnie SA v Bank of England [1951] Ch 33
Vandervell Trustees Ltd v White [1971] AC 912
Walker v Commonwealth Trading Bank of Australia (1985) 3 NSWLR 496
Willow Grange Pty Ltd v Yarra City Council, [1998] ANZ Conv R 415 Vic CA
Case(s) also cited:
Morrell v Mercantile Mutual Insurance (Australia) Ltd (1999) 21 WAR 451
TXU Electricity Ltd v The Office of the Regulator General [2001] VSC 4
(Page 5)
1 EM HEENAN J: This is an application by WMC Resources Ltd to be joined as a third defendant to this action. It is opposed by the plaintiffs. The first defendant has filed a submitting appearance in the action generally to abide by all decisions of the Court and has not been heard on this application. The second defendant, although represented on the application, makes no submissions in support of, or in opposition to, the application.
2 In seeking to be joined WMC Resources Ltd relies on the provisions of Rules of the Supreme Court O 18 r 6(2) which are as follows:
"(2) At any stage of the proceedings in any cause or matter the Court may on such terms as it thinks just and either of its own motion or on application ¾
(a) order that any person who has been improperly or unnecessarily made a party or who has for any reason ceased to be a proper or necessary party, to cease to be a party;
(b) order that any person who ought to have been joined as a party or whose presence before the Court is necessary to ensure that all matters in dispute in the cause or matter may be effectually and completely determined and adjudicated upon, be added as a party,
but no person shall be added as a plaintiff without his consent signified in writing or in such other manner as may be authorised.
(3) An application by any person for an order under paragraph (2) adding him as a defendant must, except with the leave of the Court, be supported by an affidavit showing his interest in the matters in dispute in the cause or matter."
3 As is required by O 18 r 6(3), the application is supported by affidavit. Lengthy submissions, both oral and in writing, have been made in support and in opposition.
4 The general rule is that a plaintiff who wishes to pursue a cause of action against a defendant or defendants is entitled to pursue his remedy against that defendant or those defendants alone and cannot be compelled to proceed against other persons whom he has no desire to sue – Tollfus Mieg Et Compagnie SA v Bank of England [1951] Ch 33 but, under this
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- rule, a person who is not a party may be added as a defendant against the wishes of the plaintiff, either on the application of a defendant or on his own intervention or by the court of its motion. The jurisdiction of the court under the rule is to some extent discretionary. As will be seen, there is a variety of views about the breadth of the rule but it is clear that the rule does not give the power to join a party whenever it is just or convenient to do so, but only where that party ought to have been joined or his or her presence is necessary to ensure that all questions between the original parties are effectually and completely disposed of: Vandervell Trustees Ltd v White [1971] AC 912 at 936. It has been said that this decision of the House of Lords confirmed a narrower construction of subrule (6)(2)(b) than was being applied, before then, by the English Court of Appeal. Consequently, earlier decisions need to be considered carefully and in the light of the decision in Vandervell's case (supra) – "The Supreme Court Practice", par 15/6/7. The same observation can be made in relation to decisions of courts of different jurisdictions after Vandervell's case because, in many jurisdictions, but not in Western Australia, the rule has since been amended to provide a more ample power of joinder than the decision of the House of Lords acknowledged. So, for example, the equivalent provision of the English Rules of Court now, O 15 r 6(2), reads as follows:
"6(2) Subject to the provisions of this rule, at any stage of the proceedings in any court or matter the Court may on such terms as it thinks just and either of its own motion or on application –
(a) order any person who has been improperly or unnecessarily made a party or who has for any reason ceased to be a proper or necessary party, to cease to be a party;
(b) order any of the following persons to be added as a party, namely –
(i) any person who ought to have been joined as a party or whose presence before the court is necessary to ensure that all matters in dispute in the cause or matter may be effectually and completely determined and adjudicated upon, or
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- (ii) any person between whom and any party to the cause or matter there may exist a question or issue arising out of or relating to or connected with any relief or remedy claimed in the cause or matter which in the opinion of the court it would be just and convenient to determine as between him and that party as well as between the parties to the cause or matter."
5 It has been decided that the addition of the provisions of par (2)(b)(ii) to the English rule has allowed a wider interpretation and scope to be given to the provision – Tetra Molectric Ltd v Japan Imports Ltd [1976] RPC 541 at 542. Again, however, "The Supreme Court Practice", (par 15/6/7) observes that the new rule is not wide enough to permit joinder of a party who is merely interested in the case insofar as it determines a question of law, and that the words "may exist a question or issue" relate to an existing question or issue between the existing parties – Spelling Goldberg Productions Inc v BPC Publishing Ltd [1981] RPC 280 CA.
6 Some Australian jurisdictions have introduced the new rule or equivalent provisions – Victoria Rules of the Supreme Court, r 9.06(b)(ii), Queensland, UCPR r 69(1)(b)(ii), and South Australia, r 27.05(f), but not Western Australia, O 18 r 6(2); New South Wales SCR Pt 8 r 8; the Federal Court of Australia, FCR O 6 r 8(1); or the High Court of Australia, O 16 r 4(2).
7 Regardless of its form in any particular jurisdiction, the rule does not in any way affect the necessity to have before the court the proper parties necessary for determining the point in issue – Australian Oil Exploration Ltd v Lachberg (1958) 101 CLR 119; Kendall v Hamilton (1879) 4 App Cas 504;and AG v Pontypridd Waterworks Co [1908] 1 Ch 388. Consequently, on any such application it is necessary to determine whether or not the proposed intervenor who wishes to be joined has an interest which makes it necessary for him to be before the court for the effectual and complete determination and adjudication of all matters in dispute in the cause.
8 It has been held that the court has a discretion to refuse an order for joinder – Lancaster Banking Co v Cooper (1879) 9 Ch D 594, especially if the application is made at a late stage but that, generally speaking, the power is widely exercised. Indeed, it would be difficult to justify the
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- exclusion of a party whose presence is necessary for the effectual determination and adjudication of matters in dispute and, consequently, it would seem that any discretionary power to decline an order would largely be confined to practical matters of convenience or disruption which might tell against the late admission of such a party – consider the situation which arose in News Ltd v Australian Rugby Football League Ltd (1996) 64 FCR 410 at 527. Nothing of that kind arises on the present application because it has been made at an early stage of the principal proceedings and, notwithstanding the probable increase in complexity and in the controversy of the action which such a joinder would bring, those are not factors which should disincline the court to make such an order if, otherwise, it were appropriate. Accordingly, in my view, the fate of this application must depend on the extent, if any, to which the legal rights of WMC Resources Ltd are, or might be, affected by a judgment in the action adjudicating upon the matters in controversy between the existing parties. This requires an examination of the plaintiffs' claims in the action, the issues which have arisen and the extent, if any, to which these directly affect the applicant.
The Details of the Action
9 Shortly stated, the question at issue in the litigation is whether the State appointed regulator, the first defendant, may fix certain Reference Tariffs which are to apply to third parties (not WMC Resources Ltd) for the use of the goldfields gas pipeline. The answer to that question depends upon the proper construction of a series of complicated contracts between the original and present owners of the goldfields gas pipeline and the State of Western Australia, and the effects upon these contracts of several statutory provisions including the Goldfields Gas Pipeline Agreement Act 1994 and the Gas Pipelines Access (Western Australia) Act 1998. The latter statute also incorporates and applies within the State the National Third Party Access Code for Natural Gas Pipeline Systems (the "Code").
10 The plaintiffs, as the present owners of the pipeline, are parties to an agreement with the State of Western Australia which, has been modified and extended by the statutory provisions containing, among other provisions, the power for the regulator to set tariffs and to specify the criteria by which the tariffs should be determined. Significantly, (so the plaintiffs contend) the agreement with the State contains a provision to the effect that the results of the tariff setting process will not adversely affect the economic interests of the plaintiffs beyond certain specified economic
(Page 9)
- criteria. Put simply, perhaps too simply, the plaintiffs contend that in proposing tariffs by a draft decision which the regulator published on 10 April 2001, the regulator has disregarded the economic criteria which should protect the plaintiffs' economic interests and, in the process, has set tariffs which are too low. The plaintiffs contend that, by virtue of the agreement and statutory provisions: the draft decision does not apply to them; further that the regulator is not empowered to set the tariffs which he proposes; and, as an additional claim, that in proposing the particular tariffs which have been advanced by the draft decision of April 2001, the regulator has failed to take into account a variety of relevant factors which he was obliged to consider and that, consequently, his proposed determination will be ineffective for that reason.
11 So far as concerns the present application by WMC Resources Ltd, it is important to recognise that this applicant is not a party to any of the contractual arrangements between the plaintiffs and the State under which the regulator is entitled to set tariffs for the gas pipeline, or which establish the criteria by which the tariffs may be set, or which confer protection for the plaintiffs' economic interests which have been mentioned. In short, there is no privity of contract between the applicant, WMC Resources Ltd, and any of the plaintiffs with regard to the tariff-setting mechanisms or the criteria which apply to them. Nor is the applicant, WMC Resources Ltd, a party whose right of access to the gas pipeline capacity is governed directly by the Code or by the tariffs which the regulator, the first defendant, proposes to set. That is not to say that the level of tariffs set by the regulator is without consequence for WMC Resources Ltd. Of course the potential consequences are the very reason for the applicant's desire to be joined in the action. Rather, the fate of this present application turns on whether the matters in issue in the principal action affect any right or interest of WMC Resources Ltd in a manner which entitles the applicant to be heard in opposition to the plaintiffs' claims. The plaintiffs submit they do not by their primary contention that the litigation only concerns the rights between themselves as parties to a series of contracts between them and the second defendant and that the applicant is simply a stranger to those contracts.
12 The reason why WMC Resources Ltd is not one to whom the Code applies and, therefore, not directly affected by tariffs set by the first defendant as regulator, is because it is a party to a contract which gives it secure access to the use of the gas pipeline and which contains its own comprehensive terms, relating to the consideration (or tariffs) which WMC Resources Ltd is to pay for those rights. This is the Gas Transmission Agreement (GTA) of 29 September 1998 (as later varied),
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- the only parties to which are the first plaintiff (alone of the three plaintiffs), WMC Resources Ltd and Western Mining Corporation Ltd. Because the GTA provides security of access for the use of the pipeline to WMC Resources Ltd, the tariff-setting procedure followed by the regulator under the Code, which is designed to protect other third parties who do not have the benefit of existing access arrangements, does not apply. But that, at least according to WMC Resources Ltd, is not the end of the matter.
13 The trouble for WMC Resources Ltd is that the GTA, in setting rates for its use of the gas pipeline, adopts a formula which, in certain material respects, adopts by reference and incorporates into the terms of the GTA, tariffs which are set by the regulator under the contractual/statutory regime. In other words, because of the formula for price setting adopted by the parties to the GTA, the consequences of the tariff-setting procedure followed by the regulator, will have a flow-on effect to the prices which the parties to that separate agreement have agreed upon. In some ways the situation may be compared with a contract between parties for the supply of commodity which contains a provision that the price to be paid for the commodity will be the same as, or calculated by a reference to, the price which some other person or persons might set for the supply of the same commodity, for example, a mortgage which contains an interest clause setting the interest payable by reference to an interest rate charged by a leading nominated bank to a particular class of customer – eg, the commercial lending rate or the 90-day bill rate.
14 Because of the flow-on effect to WMC Resources Ltd under the GTA, which has to an extent incorporated by reference the tariff set by the regulator, the applicant claims to be affected in a way which not only allows, but compels, its presence as a defendant in this present action. WMC Resources Ltd goes further and also submits that, to the extent that the plaintiffs desire to challenge the efficacy of the regulator's draft decision by asserting that the decision has been taken without regard to relevant criteria, the plaintiffs are pursuing what amounts to a form of judicial review under the guise of seeking declaratory orders. The applicant contends that it is a party interested in or affected by the propriety and validity of the decision made by the regulator pursuant to what is, in part at least, a statutory power. So even in the absence of contractual privity between WMC Resources Ltd and the plaintiffs, the regulator or the State in relation to the tariff-setting principles, the applicant is nevertheless a person affected and is entitled to be heard in this action. In amplification of this last submission, WMC Resources Ltd submits that it is the only real "contradictor" with an interest and capacity
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- to oppose the plaintiffs' claims in the action and that therefore, when the court is considering the exercise of the regulator's statutory power, WMC Resources Ltd is entitled to be heard.
15 There is yet another basis upon which WMC Resources Ltd claims it should be joined as a party. It contends that the GTA contains implied terms to the effect that the first plaintiff would do all things necessary to enable WMC Resources Ltd to have the benefit of that contract and not to do anything to destroy the efficacy of the bargain – Secured Income Real Estate (Australia) Ltd v St Martins Investments Pty Ltd (1979) 144 CLR 579 and O'Keefe v Williams (1910) 11 CLR 171 at 191. This submission rests on the proposition that the GTA was entered into in circumstances in which it was reasonably anticipated by the parties that the determination of tariffs for the use of the pipeline would be controlled by the regulator and, hence, any variation in the tariffs (particularly reductions) would enure to the benefit of WMC Resources Ltd by virtue of the formula which adopted, by reference, the mechanism for tariffs set by the regulator under the Code. On this basis, WMC Resources Ltd argues that the attempt by the first plaintiff, in the principal action, to challenge the efficacy of the proposed tariffs advanced by the regulator, is an attempt to deprive it of the benefits of the GTA and, consequently, is in breach of the implied term. An examination of that contention can, at this stage, be left until later.
The Contractual and Statutory Framework
16 In order to determine to what degree, if any, the rights of WMC Resources Ltd are affected by the dispute between the plaintiffs and the defendants in the principal action, it is necessary to examine the contractual and statutory obligations which, are relied upon by the parties for establishing the rights and interests which they assert are in jeopardy. In chronological order, the instruments and statutes are:
·Goldfields Gas Pipeline Agreement – 23 March 1994
· Joint Venture Agreement – 29 June 1994 (as thereafter amended)
· Sales Agency Agreement – 29 June 1994 (as thereafter varied)
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·Gas Pipelines Access (Western Australia) Act 1998 – materials parts commenced 9 February 1999
· National Third Party Access Code for Natural Gas Pipeline Systems (adopted by the GPA WA Act 1998)
· Gas Pipelines Access (Western Australia) Law – established by s 9 of the GPA WA Act 1998
· Gas Transmission Agreement – 29 September 1998 (as later varied)
17 In reviewing these instruments and legislation in order to determine whether the rights or interests of WMC Resources Ltd are directly affected, it is important to bear in mind that the interpretation and construction of them, and their application to the issues arising in the principal action, are in issue, both in the principal action itself, and in the light of contentions which WMC Resources Ltd is seeking to advance. Care must therefore be taken to avoid making a final determination on issues which are likely to be agitated in the action where there has not been a sufficient opportunity for full submissions to have been made and where, at least at this stage, it cannot be known with confidence just what, if any, bearing such an interpretation or construction might have on the final decision in the case. Nevertheless, it would be wrong to accept that any interpretation of the statutory provisions or any construction of the contracts may be open and so treat an untenable, or far-fetched submission about the meaning of the instruments as a sufficient basis to accept that the rights or interests of the applicant may be affected.
18 In my view, it is necessary for the applicant to be able to show that on a construction or interpretation of the instruments which could fairly be said to be open, it has a reasonable case to contend that its rights or interests may be so directly affected. It is necessary, therefore, that a construction or interpretation of the contractual or statutory provisions which would support the applicant's contention should be reasonably arguable in order to sustain an order for joinder. It is unnecessary and undesirable to make any final determination of the construction or interpretation of the instruments at this stage of the proceedings, beyond eliminating arguments which have no reasonable prospects of success.
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Goldfields Gas Pipeline Agreement
19 On 23 March 1994, an agreement was made between the Hon R F Court, then Premier of Western Australia for and on behalf of the State, and Wesminco Oil Pty Ltd, Normandy Pipelines Pty Ltd and BHP Minerals Pty Ltd as joint venturers and Western Mining Corporation Holdings Ltd and Normandy Poseidon Ltd as guarantors of the Normandy and BHP subsidiary companies respectively for the construction and commissioning of a pipeline and pipeline system for the transmission of natural gas from the north-west of the State to the inland Pilbara and Goldfields regions together with associated structures and apparatus to maintain and operate the gas transmission system. This is often referred to as the Goldfields Gas Pipeline Agreement or just the State Agreement. There were associated works for the construction and commissioning of gas pipelines and related facilities to connect with the Dampier to Bunbury gas pipeline and associated electricity-generation facilities. All this work was to be undertaken by the joint venturers
20 Under the agreement, the joint venturers were obliged to submit to the nominated Minister their detailed proposals for the construction and operation of the pipeline. In particular, these proposals were to include proposals for tariff-setting principles to apply to third parties other than "Initial Customers" in respect of the Initial Committed Capacity (cl 9(1)(l)). The "Initial Customers" were the joint venturers themselves, for such transmission capacity as they might agree was required for the transmission of gas for each joint venturer or its associates on terms to be agreed between the joint venturers (cl 8(1)) or third parties wishing to purchase transmission capacity in the pipeline on a proposed tariff schedule prepared in accordance with the principles to be approved by the Minister relating only to these Initial Customers. Transmission capacity of the pipeline reserved for or allocated to these Initial Customers, whether the joint venturers themselves or third parties, is known, under the agreement, as the "Initial Committed Capacity" (cl 8(3)(b)).
21 Upon receiving proposals from the joint venturers, including proposals for tariff-setting principles, the Minister was to give notice to the joint venturers of his decision upon them (cl 10(2)) which, if approved, was then to be implemented by the joint venturers, to the best of their reasonable endeavours (cl 10(7)).
22 The Gas Pipeline Agreement contains provisions which allow the joint venturers to modify, expand or vary the activities carried on pursuant to the agreement subject to the approval of the Minister (cl 12). There is
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- an obligation upon the joint venturers actively to promote the use of the pipeline by third parties and to pursue growth in the market for gas transmission through the pipeline (cl 19). Consistently with those objectives, the parties are obliged to provide non-discriminatory third party access to available capacity in the pipeline, including "Developable Capacity" subject to and in accordance with by-laws made or varied under the agreement or by other applicable legislation (cl 20) and to use all reasonable endeavours to develop the capacity of the pipeline as may be necessary to accommodate the requirements of third parties wishing to transmit gas through it (cl 20(4)). In the event that third parties (not Initial Customers) who wish to obtain access, or additional access, to the pipeline are unable to agree upon terms with the joint venturers for doing so, they may apply to the Minister who may, in the absence of any agreement to resolve the dispute, direct the terms upon which, and the extent to which, access shall be given (cl 20(8), (9) and (10)).
23 Clearly, the terms of access and the tariffs which will apply for Initial Customers and third parties using the gas pipeline are of crucial importance for the economic performance of the pipeline and the financial return to the joint venturers or their successors for their investment. The ultimate role in determining the proposals for the construction, development, operation and expansion of the pipeline, including in particular the tariff regime, will at all times be undertaken by the Minister. This has occurred in a setting where the State agreed to introduce and sponsor a Bill in the State Parliament (cl 4) for an Act to ratify the agreement and where, subject to qualifications which do not now apply, the agreement would not take effect unless and until such a Bill were enacted (cl 4 and cl 5).
24 The ability to revise by-laws and regulations to be made on the recommendation of the Minister has already been alluded to. Power for the Governor in Executive Council to make such by-laws is expressly conferred by cl 21(1). However, the State Agreement was entered into at a time when proposals were afoot nationally for governments of the States and Territories of Australia to introduce uniform laws relating to petroleum and gas pipeline operations. In anticipation that such national or uniform laws might eventually be enacted, the Gas Pipeline Agreement provided for that contingency. Provisions of the agreement in this regard, and which are central to the issues in the present litigation, are as follows:
"21(2) In the event of uniform laws or subsidiary legislation being promulgated for petroleum and gas pipeline operation in Western Australia then,
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- subject to sub-clause (3), any by-laws made under sub-clause (1) shall cease and determine on the expiry of two years after the coming into operation of the uniform laws or subsidiary legislation.
- (3) The uniform laws and subsidiary legislation referred to in sub-clause (2) shall not have effect to the extent that the Joint Venturers can demonstrate that the uniform laws or subsidiary legislation there referred to have or are likely to have a material adverse effect on the legitimate business interests of the Joint Venturers but in any event, in so far as any such uniform laws or subsidiary legislation may purport to apply to the Initial Committed Capacity, such of those uniform laws or that subsidiary legislation shall only so apply to the extent that the Initial Committed Capacity is, from time to time, unutilised."
25 The importance of the tariffs to be set for the use of the pipeline is also emphasised by cl 22(1) of the State Agreement which effectively states the policy in these terms:
"22(1) The contracts for transmission of natural gas and associated services negotiated by the Joint Venturers with Third Parties must incorporate tariffs that are fair and reasonable and consistent with the tariff setting principles approved by the Minister under this Agreement."
26 The clause goes on to provide a mechanism which requires the joint venturers to establish and maintain an "Indicative Tariff Schedule" in sufficient detail to allow potential users to calculate gas transmission charges and for this to be provided to the Minister. There is also a mechanism which provides for information to be supplied to the Minister which can be utilised by him solely for the purposes of making determinations with regard to tariffs (cl 22(7)).
27 I have already noted that the Goldfields Gas Pipeline Agreement contains an obligation for the State to introduce and promote a Bill for an Act in the Parliament to ratify the agreement and that, in most respects,
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- the agreement is conditional upon the enactment of such ratifying legislation within a specified time limit. The agreement also contained a provision (cl 5(3)) that upon the commencement of operation of such a ratifying Act, the provisions of the agreement should operate and take effect notwithstanding the provisions of any Act or law. This is a familiar mechanism for large-scale industrial mining and intra-structure projects in this State, but such provision in an agreement alone cannot of course modify, vary, suspend or amend any law of the State. At 23 March 1994, the most that such a subclause could do was to forecast the operation which the agreement would have if and when ratified in the manner anticipated.
28 The Government Agreements Act 1979 is declaratory of the effect and operation which identifiable government agreements have. The Goldfields Gas Pipelines Agreement is one such example. That Act provides that "each provision in a government agreement shall operate and take effect, and shall be deemed to have operated and taken effect from its inception, according to its terms notwithstanding any other Act or law…". As already indicated, such a status for the Goldfields Gas Pipeline Agreement was only achieved when it later became ratified by the Act of Parliament which it contemplated.
Goldfields Gas Pipeline Agreement Act 1994
29 The anticipated ratifying Act was duly enacted by the State Parliament and took effect upon its assent on 3 May 1994. Under the Goldfields Gas Pipeline Agreement Act 1994 the Goldfields Gas Pipeline Agreement of 23 March 1994, as set out in Sch 1, was specifically ratified and its implementation authorised. Section 4(3) also provided that, without limiting or otherwise affecting the application of the Government Agreements Act 1979, the agreement operates and takes effect despite any other Act or law. It therefore follows that the mechanism for establishing and revising tariff schedules for access to the pipeline by third parties contained in cl 21 and cl 22 of the State Agreement thereupon took effect despite any other Act or law.
30 At least at this stage, there appears to be no reason why the same status and effect did not apply to cl 21(3) with its inbuilt provision to exclude the future operation of uniform laws and subsidiary legislation to the extent that the joint venturers could demonstrate that such operation would have, or be likely to have, a material adverse effect on the legitimate business interests of the joint venturers. Mr Zelestis QC, for the present applicant, submitted that this was a contentious constitutional
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- issue and foreshadowed that WMC Resources Ltd could contend that there was no power for the Minister to curtail or modify the application of some other law of general application on the strength of a clause such as cl 21(3) in a contract to which the State is a party. That proposition could readily be accepted if the clause had no greater force and application than the agreement of the contracting parties. However, I do not consider that there is any other reasonable conclusion which can be drawn than that all provisions of the Goldfields Gas Pipeline Agreement, by the ratifying Act of 1994, and by the Government Agreements Act 1979, took effect and operated according to their terms notwithstanding any other Act or law. If, as Mr Zelestis QC, submits, there is any inconsistency between the Goldfields Gas Pipeline Agreement as ratified, and some other subsequent legislation of the State, it will become a matter of statutory interpretation to determine how, and to what extent, the two allegedly conflicting provisions are to operate in combination. In other words, I do not consider that there is any reasonable basis for an argument that the Goldfields Gas Pipeline Agreement Act, or the agreement as ratified thereunder, is beyond the legislative competence of the Parliament of this State or is subject to any constitutional question about its validity.
Joint Venture Agreement and Sales Agency Agreement - 29 June 1994
31 Following the ratification of the Goldfields Gas Pipeline Agreement by the Act of 1994 the three joint venturers entered into a joint venture agreement of 29 June 1994 recording their mutual obligations and appointing a company, Goldfields Gas and Transmission Pty Ltd ("GGT"), as manager of the pipeline for the joint venture. By a Sales Agency Agreement, also of 29 June 1994, GGT was also appointed agent of the joint venturers for the negotiation of sales for gas and gas transmission capacity of the pipeline.
Changes in Ownership of the Pipeline
32 Between January 1995 and January 1999 a series of sales and a takeover resulted in the three plaintiffs in this action becoming the sole owners of the pipeline. As set out in the statement of claim, BHP Minerals Pty Ltd transferred its interest under the State Agreement to its subsidiary, Pilbara Energy Pty Ltd, in January 1995 and Pilbara Energy Pty Ltd then replaced it as a member of the joint venture. In September 1998 Wesminco Oil Pty Ltd transferred its interest in the State Agreement and in the joint venture to the first plaintiff, Southern Cross Pipelines Australia Pty Ltd. Then in January 1999 BHP Minerals Pty Ltd
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- transferred all its shares in Pilbara Energy Pty Ltd to Duke Energy WA Holdings Pty Ltd. Pilbara Energy Pty Ltd was thereupon renamed Duke Energy WA Power Pty Ltd, the third plaintiff in these proceedings. Finally, between February and March 1999 Normandy Pipelines Pty Ltd transferred its interest in the agreement to Southern Cross Pipelines (NPL) Australia Pty Ltd, the second plaintiff.
33 A series of corresponding variations to the joint venture agreement and other associated agreements were made contemporaneously with these changes and approvals were secured from the Minister on behalf of the State. The result is that the three plaintiffs now own the pipeline and GGT is still the JVA manager and sales agent for the pipeline.
Uniform Gas Pipeline Laws - Gas Pipelines Access (Western Australia) Act 1998
34 The preamble to the Gas Pipelines Access (Western Australia) Act 1998 recites that the Council of Australian Governments agreed, in February 1994, to general principles of competition policy reform to enable third parties, in particular circumstances, to gain access to essential facilities. Part of the commitment of the Council of Australian Governments was to agree to more specific proposals for the development of free and fair trade in natural gas. In November 1997, the Commonwealth, all the States and the two mainland Territories agreed to the enactment of legislation in all those jurisdictions to establish a uniform national framework for third party access to gas pipelines. This uniform national framework was to prevent the abuse of monopoly power, promote a competitive market for natural gas and provide rights of access to natural gas pipelines on conditions that are fair and reasonable for the owners and operators of gas transmission and distribution pipelines and persons wishing to use the services of those pipelines. The Parliament of Western Australia considered that it was also desirable that the uniform national framework should also apply to pipelines for the reticulation of gas other than natural gas in Western Australia.
35 These uniform national objectives were implemented in Western Australia by:
(a) adopting and applying throughout the State the "Gas Pipelines Access Law" comprising:
• Schedule 1 to the Act being the terms of third party access to natural gas pipelines and
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- • Schedule 2 being the National Third Party Access Code for Natural Gas Pipeline Systems ("the Code")
- (In their application within Western Australia these provisions are known collectively as the "Gas Pipelines Access (Western Australia) Law" - see s 3 and s 9. Further, regulations made under the Gas Pipelines Access Law apply in Western Australia as Gas Pipelines Access (Western Australia) Regulations by virtue of s 10 of the Act.)
(b) establishing, with defined powers, the Western Australia Independent Gas Pipelines Access Regulator (s 27), an officer who is to provide independent regulation of tariffs and other operations of gas pipelines within this State, and have the functions and powers declared by s 36. It is this regulator who is the first defendant in the principal litigation.
(c) establishing the Western Australian Gas Review Board (s 50 to s 60).
(d) the establishment of the Office of the Western Australian Gas Disputes Arbitrator (s 62 to s 85).
(e) certain transitional arrangements (s 90 to s 97) which include provision for the temporary continuation of access arrangements for the Goldfields Gas Pipeline by providing that the then existing arrangements for gas transmission for that pipeline under the ratified agreement are taken to be an approved access arrangement under the Code until 1 January 2000.
36 Under the provisions of the Gas Pipelines Access (Western Australia) Act 1998 relating to the Goldfields Gas Pipeline, s 97, the joint venturers to that State Agreement were obliged to submit to the local regulator not later than nine months after the commencement of the Act (9 February 1999), that is by the 9 November 1999, a proposed access arrangement and the applicable access arrangement information for that pipeline (s 97(3)).
37 By this means the regulator, applying the applicable provisions of the Code must, in due course, make a determination relating to the provisions, including access tariffs, upon which third parties will be able to obtain access to the Goldfields Gas Pipeline. The proposed access arrangement must include a Reference Tariff code - cl 3.3 which is either determined through a competitive tender process, or must be one, which in the
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- regulator's opinion, complies with the Reference Tariff principles and the Reference Tariff policy which is part of the national uniform policy and which are explained by s 8 of the Code. The Goldfields Gas Pipeline is specifically identified as a "Covered Pipeline" to which the Code applies - s 1.1 and Sch A to the Code.
38 It is pursuant to these provisions of the Gas Pipelines Access (Western Australia) Act 1994 and the applicable Code that the plaintiffs submitted to the first defendant, as regulator, a proposed access arrangement together with the necessary access arrangement information as set out in par 54 to par 56 of the statement of claim (as amended on 2 May 2002), and which the first defendant, as regulator, thereafter proceeded to consider. It is the regulator's draft decision of 10 April 2001 upon these proposals (amended statement of claim par 57 and par 58) which has propounded a reference tariff which, if finally adopted, so the plaintiffs allege, will result in an approximate 30 per cent reduction in the discounted tariffs and an approximate 50 per cent reduction in the A1 tariffs (par 58 of the statement of claim).
39 In this action the plaintiffs, by par 59 to par 67, of their statement of claim allege that the regulator's draft decision has, or is likely to have, a material adverse effect on the legitimate business interests of each of the plaintiffs, the details of which are then set out with much particularity. The plaintiffs further claim that by virtue of cl 21(3) of the State Agreement such a decision by the regulator and in particular such Reference Tariffs, should not have effect to the extent that they have or are likely to have such a material adverse effect. This is the first of the principal claims by the plaintiffs in the existing action. Its determination will require decisions to be made upon the proper construction of the State Agreement as varied, and upon the proper interpretation of the Gas Pipelines Access (Western Australia) Law incorporating, as this does, the Code. Obviously, and critically, this will involve a consideration of how the application of the general provisions of the Code to this pipeline and to these plaintiffs, may be qualified by cl 21(3) of the State Agreement and by s 97(4) of the Gas Pipelines Access (Western Australia) Act 1998.
40 The direct significance of this controversy, while obviously affecting the parties to the State Agreement, would only seem to extend beyond them to third persons who desire to be able to have the benefit of the Gas Pipelines Access (Western Australia) Act 1998 and the national Code in order to secure access, on acceptable terms, to the transmission capacity of the Goldfields Gas Pipeline. An important ingredient in securing terms for satisfactory access will be the availability of a Reference Tariff set by
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- the regulator in accordance with the principles and mechanisms specified by s 8 of the Code. Such third persons who are so affected and will be able to take the benefit of the legislation to secure access to the pipeline on regulated terms will be those persons or bodies who do not already have access to the pipeline, whether as parties to the State Agreement (joint venturers) or as parties who have existing access contracts such as the "Initial Customers". Accordingly, controversies over whether or not any determination by the regulator under the Code with respect to the Goldfields Gas Pipeline will only directly affect those parties who are privy to the State Agreement, namely the plaintiffs and the State of Western Australia, or third persons who desire to seek access to pipeline capacity but who do not already have any contractual access arrangement. The applicant, WMC Resources Ltd, is not within this category of persons or bodies because it has, and has for some time, had secure access arrangements to this pipeline under the Gas Transmission Agreement - which is yet to be examined in detail.
41 The second principal claim which the plaintiffs make in the existing litigation asserts that, in coming to his draft decision, the regulator has acted beyond jurisdiction (statement of claim par 68 to par 72). The grounds for this assertion appear to be no more than a contention that cl 21(3) of the State Agreement denies the regulator any power under the Code to make a Reference Tariff or other determination with respect to the Goldfields Gas Pipeline. Although it is unnecessary to reach any final conclusion about this aspect of the claim at this stage of the proceedings, it has all the appearances of being an over-reaching one because the terms of s 21(3) of the State Agreement appear to do no more than restrict, to a limited degree, the application of determinations made by the regulator with respect to the Goldfields Gas Pipeline without, otherwise, impeaching his power or curtailing his duties. Accordingly, although this claim is couched in the language of jurisdiction it seems to be reasonably plain that it is, in substance, no more than a slightly different version of putting the issues which the plaintiffs had already raised concerning the proper construction of the State Agreement and the interpretation of the Code.
42 More significantly, the third principal claim by the plaintiffs challenging the draft determination of the regulator is based on the alleged existence of certain errors of law more fully set out in par 73 to par 78 of the statement of claim. These alleged errors of law include a claim that cl 21(3) of the State Agreement was misconstrued; that the provisions of the Code itself have been misconstrued; an allegation of failure to take into account relevant considerations; a plea that the regulator wrongly
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- took into account an irrelevant consideration; and an assertion that the regulator erred in law by reaching certain decisions unsupported by evidence. Most of these grounds, with the exception of the allegations of taking into account an irrelevant consideration and making decisions unsupported by the evidence, hark back to the significance of cl 21(3) of the State Agreement and involve assertions that, in reaching his decision and applying the terms of the Code the regulator has disregarded or mistaken the proper meaning and effect of that term.
43 Insofar as the grounds go beyond express assertions about disregard or misconstruction of cl 21(3) of the State Agreement, they appear to contain derivative or associated arguments to the effect that in applying specified economic criteria, certain economic consequences were wrongly rejected or accepted by the regulator when determining whether or not they had, or were likely to have, a material adverse effect upon the legitimate business interests of the joint venturers – within the meaning of cl 21(3) of the State Agreement. Accordingly, viewed as a whole, the plaintiffs' case appears to be largely one which involves the construction of the agreement and the interpretation of the applicable legislation, notwithstanding the inclusion within the statement of claim, of paragraphs dealing with challenges to jurisdiction and pleading alleged errors of law.
Gas Transmission Agreement (GTA)– 29 September 1998
44 This is the agreement which WMC Resources Ltd submits confers upon it rights or interests which are such that it ought to have been joined as a party in the action and that it is a party whose presence before the Court is necessary to ensure that all matters in dispute in the cause may be effectually and completely determined and adjudicated upon. It was made between Wesminco Oil Pty Ltd, one of the original joint venturers, whose interests have now been transferred to the first plaintiff, and WMC Resources Ltd and WMC Ltd on 29 September 1998. Broadly described, it entails one of the joint venturers providing, on a secure basis, access to a certain defined capacity of that joint venturer's share of the pipeline, and the gas being supplied thereby, to WMC Resources Ltd for a term ending in January 2037. It is determinable, or variable after one year's prior notice which can only be given after the first 15 years of the supply contract (cl 5). This contract contains elaborate provisions defining the amounts, and the reliability of supply, of the gas to be provided, the points of delivery, the rates of delivery (with relevant maxima) and other matters. Significantly, it sets a tariff payable by WMC Resources Ltd for the gas supplied by a specified mathematical formula which relates to the
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- first four years of supply. The interpretation of particular terms in the GTA is to be determined in accordance with the joint venture agreement and the general terms and conditions for gas pipeline services published by GGT as manager of the pipeline (cl 3.1).
45 The tariff defined for the supply of gas by the GTA is fixed to the year ended 31 December 2001. Thereafter, cl 10(1)(b) of the agreement provides that the tariff payable for "Firm Service" should be the minimum published tariff generally available for comparable "Firm Service" in the pipeline as determined under the general terms and conditions as at 1 January 2002.
46 Although not expressly addressed in the submissions before me at the hearing of this application, I take it that this is a tariff which would apply to a party who already has secured access to the pipeline and who is not, therefore, regulated by Reference Tariff established under the Code. This may turn out to be an unjustified inference but it does not lead to any material conclusion for the purposes of this present application for joinder. Another similar inference suggests that tariffs calculated for the GTA in accordance with cl 10(1)(b) after 1 January 2002 are likely to be more onerous for the party obtaining access, than the tariffs determined by the regulator under his provisional draft decision which is the subject of the litigation.
47 Be that as it may, the critical provision in the GTA, upon which WMC Resources Ltd relies, is as follows:
"10.2 Review of General Tariff
If, at any time on or after 1 January 2002, the tariff under the access and tariff regime then applicable to the Pipeline which most nearly approximates the Benchmark Tariff as defined in the tariff setting principles under the tariff package forming part of the Firm Service Terms (as modified from time to time to reflect discounts generally available to third party customers for Firm Service under item 12 of those tariff setting principles) (the "Firm Service Reference Tariff") is lower than the tariff for Firm Service in the Pipeline under this Agreement, the Firm Service Reference Tariff shall automatically apply to the Shipper as from 1 January 2002 or the date of its introduction, whichever is the later."
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48 All the parties to this litigation, and the applicant, WMC Resources Ltd, are agreed that the effect of this provision in the GTA is that if the Reference Tariffs propounded by the regulator in his draft decision of 10 April 2001 (par 57 of the statement of claim) take effect and apply to the supply of gas by the plaintiffs under the State Agreement, either pursuant to or notwithstanding cl 21(3) of that agreement, this is likely to result in a much lower tariff applying to WMC Resources Ltd by virtue of cl 10(2) of the GTA. In other words, it is acknowledged that cl10(2) of the Gas Transmission Agreement effectively picks up and applies, by reference, the Reference Tariffs fixed by the regulator under the Code if, and to the extent that, they apply to this pipeline. Consequently, although it is not a party to the State Agreement and is not a party seeking access to the pipeline to which the Reference Tariffs determined in accordance with the Code would apply, WMC Resources Ltd contends that it is entitled to the benefit of those tariffs if, and to the extent, that they apply under the State Agreement.
49 WMC Resources Ltd is, therefore, in a situation where the price for the commodity which it is receiving under the Gas Transmission Agreement is set, by express contractual terms in the GTA, which incorporate by reference a tariff determination made by the regulator under contractual and statutory terms which apply to other parties. No-one disputes that proposition. The economic consequences for WMC Resources Ltd, if the cheaper tariffs proposed by the regulator's draft decision which is under challenge, do apply, are very great. It is not surprising, therefore, that WMC Resources Ltd wishes to add its voice and efforts in opposition to the plaintiffs' claims in the present action. The question, however, is whether or not any of its rights or interests are affected in a way which makes its joinder necessary.
WMC Resources Ltd – Claim for Joinder
50 Enough has already been said to explain how, because of the formula adopted by cl 10(2) of the GTA, the benefit of Reference Tariffs set by the regulator in his draft decision which is challenged by the plaintiffs, will, if they apply to the State Agreement, flow on to the applicant. However, WMC Resources Ltd is not a party to the State Agreement and has no contractual privity upon which it can claim it should be heard when the Court is called upon to construe cl 21(3) in a dispute between the parties to that contract. Mr Zelestis QC seeks to counter the effect of that obvious fact by submitting that the question of the true meaning and effect of cl 21(3) of the State Agreement will have a direct bearing on his client's
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- interest under the GTA and is a matter which WMC Resources Ltd could litigate with the first plaintiff under the GTA in various circumstances, some of which he outlined. Mr Zelestis QC posited a difference arising between WMC Resources Ltd and the first plaintiff over whether, pursuant to cl 10(2) of the GTA, the applicant would be entitled to the benefit of lower tariffs if these were determined by the regulator as proposed in his draft decision. Such a dispute would entail a determination, as between WMC Resources Ltd and the first plaintiff, of the issue of whether or not any such decision by the regulator would extend to the first plaintiff in the circumstances having regard to the provisions of cl 21(3) of the State Agreement. This is the principal issue between the parties in the present litigation but a decision on that issue as between those parties, would not bind WMC Resources Ltd. Therefore, there is the possibility, perhaps even a probability, that further proceedings between WMC Resources Ltd and the first plaintiff may be necessary to determine that question. All that may be accepted and it reveals that, at least to this extent, there is a common question which has arisen in the present litigation between the parties and which may also arise between the first plaintiff and WMC Resources Ltd over their respective rights and obligations under the GTA. Whether the existence of such a common question is sufficient to require that WMC Resources Ltd be joined in these proceedings is another matter.
51 WMC Resources Ltd advances a second argument upon which it relies for the proposition that it is a necessary party to the existing litigation. This submission is that, insofar as the regulator undertakes the process of determining Reference Tariffs for the Goldfields Gas Pipeline under s 8 of the Code, he is a public officer performing a statutory function the outcome of which is likely to affect many persons. As the submission goes, the proper performance of that function and the correctness of any decision made by the regulator under the Gas Pipelines Access (Western Australia) Law are issues in the present litigation upon which any person having a sufficient interest is entitled to be heard. The submission likens the challenges to the jurisdiction and correctness of the decision by the regulator made by the plaintiffs in the present action, to claims for judicial review which, if involving an application for certiorari, would allow a person with a special interest to be heard. On this submission, the form in which the proceedings have been instituted, namely, by writ seeking declarations of right, should not be allowed to prevent the joinder and the rights to be heard of persons who have a sufficient interest to support or oppose the decision of the regulator as a matter of public law. Accordingly, on the basis that there is a statutory
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- power which is being questioned in these proceedings, the applicant contends that it is entitled to be heard. The basis of this entitlement, as the submissions were developed, appears to be the combination of the applicant's interests in ensuring that any review of the decision of the regulator on grounds of jurisdiction or error of law, involves the presence of a proper contradictor (a role it cherishes for itself), and the entitlement of any person with a sufficient interest to be heard. The sufficiency of the interest claimed by the applicant lies in its role as a party who takes gas from the pipeline, and as a party whose contractual arrangements with the first plaintiff incorporate a price-fixing mechanism applying any decision of the regulator which extends to the first plaintiff.
52 The proper discharge of the statutory function of the regulator to determine Reference Tariffs under s 8 of the Code is, as already identified, primarily for the benefit of third parties who are seeking to obtain access to the pipeline but have been unable to do so on acceptable terms. WMC Resources Ltd accepts, quite unreservedly, that it is not such a person because of its established secure access under the Gas Transmission Agreement. It would seem to follow from this that it is not a member, or a potential member, of the class of parties whom the exercise of the statutory function by the regulator under s 8 of the Code in setting Reference Tariffs is designed to protect. This being the case, WMC Resources Ltd does not appear to be a contradictor whose interests the law recognises.
53 In any event the first defendant, the regulator, and the second defendant, the State of Western Australia, are directly interested in vindicating the scope and validity of the regulator's role under the Code and under the Gas Pipelines Access (Western Australia) Act 1994. Not only are these parties interested in the application and effect of State legislation but the State is itself a party to the Goldfields Gas Pipelines Agreement and is directly interested in the pipeline operating on a competitive basis. There is no reason to assume that one or both of these defendants will not be a proper contradictor of the plaintiffs' claims on issues going to the powers and procedures of the regulator. The criticism made by the High Court of a tribunal presenting a positive substantive case in The Queen v The Australian Broadcasting Tribunal Ex parte Hardiman (1980) 144 CLR 13 at 35 – 36 stemmed from the risk that by becoming a protagonist in an action challenging the decisions of the tribunal, it may endanger the impartiality which it will be expected to maintain when the proceedings before the tribunal continue. The High Court expressly acknowledged that such a tribunal could make submissions going to its powers and procedures. These proceedings
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- should not involve the existing defendants infringing any conventional limitations of their roles.
54 This conclusion emphasises that the interest which WMC Resources Ltd is seeking to protect is the effect which a determination of Reference Tariffs extending to the State Agreement in this case would have, by having been incorporated as a price-fixing mechanism in the GTA under cl 10(2). This reveals that the reliance on the public law position and an interest in securing the proper determination of the statutory powers of the regulator, is but another way of the applicant asserting that, because of the economic effect of which such a determination in the principal action may have from flowing on to the GTA through the mechanism of cl 10(2) that it is a necessary party and should be joined.
55 There is a third argument upon which counsel for the applicant contends that there is an issue which entitles his client to be heard and requires its joinder. The applicant submits that a question necessarily arises about the effect of clause cl 23(1) in the State Agreement which purports to prevent the application or extension of laws of the State to this contract. As the applicant puts it, a provision which has the effect of excluding or suspending the operation of a general law of the State to a particular contract could not be valid unless it too had statutory effect of such a kind which prevented the application of the other general law. The submissions made on behalf of the applicant were that it was, at the very least, arguable that despite its terms, no such effect could be given to cl 21(3) of the State Agreement because of inconsistency with the Gas Pipelines Access (Western Australia) Law including the Code. Mr Zelestis QC founded this argument on the submission that there was nothing in the terms of the Government Agreements Act 1979, or in the Goldfields Gas Pipeline Agreement Act 1994 which gave such inviolable status to cl 21(3) or to any other part of the Goldfields Gas Pipelines Agreement but this seems to me, with respect, to give insufficient recognition to the terms of s 3 of the Government Agreements Act 1979 and to s 4(3) of the Goldfields Gas Pipeline Agreement Act 1994.
56 Perhaps another way of looking at the applicant's submissions in this regard is to treat them as a contention that, notwithstanding the status given to a government agreement, by the Government Agreements Act 1979 or by the individual ratifying act, such status can always be overridden by later legislation which expresses a clear intention of having that effect, even upon an Act which ratifies a State Agreement – see South Eastern Drainage Board v The Savings Bank of South Australia (1939) 62 CLR 603, especially per Latham CJ at 617 – 618;
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- Commonwealth Aluminium Corporation Ltd v Attorney General [1976] Qd R 231. Giving the fullest benefit to such a contention for the applicant would entail the proposition that the Gas Pipelines Access (Western Australia) Act 1998 in adopting the Code effected an implied repeal of those provisions of the Government Agreements Act 1979 and the Goldfields Gas Pipeline Agreement Act 1994 which purported to give primacy to provisions of the State Agreement. On such an argument it would, no doubt, be contended that the ratification effected by the 1994 Agreement Act did no more than override any inconsistent provisions in any legislation of the State existing at the date of ratification – see Sankey v Whitlam (1978) 142 CLR 1 per Mason J at 89 - 91 and MacDonald KD "The Negotiation and Enforcement of Agreements with State Governments Relating to the Development of Mining Ventures" and commentaries at (1957) 1 Australian Mining and Petroleum Law Journal, pages 229 – 258; Warnock L.J. – "State Agreements" (1982) 4 AMPLJ 1.
57 It is therefore necessary to consider whether an implied repeal of cl 21(3) of the State Agreement as ratified has been effected by the Gas Pipelines Access (Western Australia) Law. One immediately notes cl 2.25 of the Code which provides:
"2.25 The Relevant Regulator must not approve an Access Arrangement (or draft and approve its own Access Arrangement) any provision of which would, if applied, deprive any person of a contractual right in existence prior to the date the proposed Access Arrangement was submitted (or required to be submitted), other than an Exclusivity Right which arose on or after 30 March 1995."
- This, the plaintiffs submit, means that the regulator would not be able to approve an access arrangement which overrode the benefits conferred on the plaintiffs by cl 21(3) of the State Agreement. Additionally, the plaintiffs point to s 97(4) of the Gas Pipelines Access (Western Australia) Act 1998 itself which provides:
"97 …
(4) The references in subclause (3) of clause 21 of the ratified Agreement as in force immediately before the commencement of section 9 of this Act to 'uniform laws or subsidiary legislation' and to 'uniform laws and subsidiary legislation' include the provisions of the Gas Pipelines Access (Western Australia) Law, and nothing in
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- that Law or in this section is to be taken to affect the operation of that subclause.
- (5) Nothing in subsection (4) prevents the parties to the ratified Agreement from, in accordance with its terms, varying or rescinding clause 21(3) or entering into a fresh provision in place of it."
58 I have reached the conclusion that these provisions leave no room for any reasonable argument but that cl 21(3) of the State Agreement was intended to have its full effect, notwithstanding the later enactment of the Gas Pipelines Access (Western Australia) Act 1998. In other words, I consider that there are no reasonably arguable grounds to contend that cl 21(3) of that agreement as ratified has been reduced in effect by the enactment of the later legislation. Accordingly, I do not consider that the applicant, even if it had standing to do so, could demonstrate that cl 21(3) of the State Agreement does not continue to apply according to its terms. So I conclude that the applicant has not established any ground to be joined as a party to this present litigation in order to advance that particular contention.
59 This, of course, leaves entirely open for decision in the principal proceedings the issue of whether or not the effect of the draft decision of the regulator of 10 April 2001, if implemented, would have or would be likely to have a material adverse effect on the legitimate business interests of the joint venturers. That is an issue which will need to be decided in the current proceedings.
60 It is now necessary to consider whether the existence of the common question which has arisen in the present proceedings, and which would also arise in any dispute between WMC Resources Ltd and the first plaintiff over whether or not, by virtue of cl 10(2) of the GTA, any determination by the regulator of Reference Tariffs as proposed would apply to the first plaintiff in the light of cl 23(1) of the State Agreement, thus producing a flow-on effect with regards to tariffs applicable under the GTA means that the applicant should be joined in these proceedings. When considering this question, it is important not to overlook the further submission made by Mr Zelestis QC for the applicant, that cl 23(1) of the State Agreement is, by necessary implication, incorporated into the GTA as part of the formula prescribed by cl 10(2) of the latter for determining the gas tariff applicable. It does seem to me that it is reasonably arguable that cl 23(1) of the State Agreement is, pro tanto, incorporated by reference into the GTA and forms part of the contractual terms existing
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- between WMC Resources Ltd and the first plaintiff. That, however, does not make WMC Resources Ltd a party to the State Agreement, nor all the plaintiffs parties to the GTA. It simply means that there are two separate contracts each, containing a common term (cl 21(3) of the State Agreement) and that WMC Resources Ltd is only a party to the second of those contracts. The question still remains whether the existence of such a term confers a sufficient interest or right for WMC Resources Ltd to be heard in relation to a dispute over its effect between the parties to the first contract.
61 Having, by this long scrutiny of the contracts, the legislation and the contentions of the parties, identified the basis upon which WMC Resources Ltd asserts that it is a necessary party to this action, it becomes necessary to return to the principles which should determine any such application for joinder under Rules of the Supreme Court O 18 r 6(2). Counsel for the applicant and counsel for the plaintiffs both relied on the unreported decision of the Full Court in Homestyle Pty Ltd v City of Belmont & Anor [1999] WASCA 59 which considered the test to be applied when deciding upon the joinder of a party under O 18 r 6(2)(b). In that case, Templeman J, in a judgment in which Malcolm CJ and Owen J both agreed, said that the test to be applied in considering the joinder of a party is that stated by Lord Diplock, when delivering the advice of the judicial committee of the Privy Council, in Pegang Mining Co Ltd v Choong Sam (1969) 2 MLJ 52 at 55 – 56:
"The cases illustrate the great variety of circumstances in which it may be sought to join an additional party to an existing action. In their Lordships' view one of the principal objects of the rule is to enable the court to prevent injustice being done to a person whose rights will be affected by its judgment by proceeding to adjudicate upon the matter in dispute in the action without his being given an opportunity of being heard.
To achieve this object calls for a flexibility of approach which makes it undesirable in the present case, in which the facts are unique, to attempt to lay down any general proposition which could be applicable to all cases.
It has been sometimes said as in Moser v. Marsden [1892] 1 Ch 487 and in Re IG Farbenindustrie AG [1944] Ch 41 that a party may be added if his legal interests will be affected by the judgment in the action but not if his commercial interests only would be affected. While their Lordships agree that the mere
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- fact that a person is likely to be better of financially if a case is decided one way rather than another is not a sufficient ground to entitle him to be added as a party, they do not find the dichotomy between 'legal' and 'commercial' interests helpful. A better way of expressing the test is: will his rights against or liabilities to any party to the action in respect of the subject matter of the action be directly affected by any order which may be made in the action?"
62 Templeman J went on to cite and apply a passage from the joint judgment of the Full Court of the Federal Court in News Ltd v Australian Rugby Football Ltd (1996) 64 FCR 410 at 525 that:
"The test involves matters of degree, and ultimately judgment, having regard to the practical realities of the case, and the nature and value of the rights and liabilities of the third party which might be directly affected. The requirement that a third party's rights against, or liability to, any party to the proceedings be directly affected is an important qualification that recognises that many orders of a court are likely to affect other people to a greater or lesser extent. This is particularly so with remedies in the nature of an injunction: see Silktone Pty Ltd v Devreal Capital Pty Ltd (1990) 21 NSWLR 317, at 322, per Kirby P. The requirement of a direct effect on rights or liabilities differentiates the case where a person ought to be joined, from other cases where the effect of the order on non-parties can be characterised as only indirect or consequential."
63 The application of these principles in Homestyle Pty Ltd v City of Belmont (supra) resulted in a decision that one of two tenderers to a contract to undertake refurbishment of the administration building of the City of Belmont under tender terms which arguably implied a right for each tenderer to have its bid considered by fair dealing of the competitive tender process, meant that the unsuccessful tenderer should have been joined in the action. That action was between the City of Belmont and the successful tenderer and raised the issue of whether or not the City was entitled to contract with the selected tenderer, it being argued that it would be illegal to do so as the selected tenderer was not then a registered builder under the Builders' Registration Act 1939. The basis for the success by Homestyle in the appeal, therefore, was that its contract with the City of Belmont entitled it to have its own and all other tenders evaluated and selected according to law so that if a question arose about another tenderer being ineligible by law for selection, its own contractual
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- rights were directly affected. It was claimed that Homestyle would be entitled to seek an injunction to restrain the City of Belmont from entering into a contract with the selected tenderer until the question of fairness in the tendering process had been resolved – Willow Grange Pty Ltd v Yarra City Council, [1998] ANZ Conv R 415 Vic CA. It can, therefore, be seen that the decision in Homestyle Pty Ltd v City of Belmont accepted that it was arguable that for the City of Belmont to enter into a contract with the selected tenderer would involve a breach of a contract between the City and Homestyle relating to the tender process.
64 It has not been submitted in the present case that a decision in the principal action for or against the plaintiffs would involve any breach of a contract between the applicant and the first plaintiff or the impeachment of any proprietary or other right of the applicant. There are no grounds for any such argument. The applicant submits that a determination in the principal proceedings of whether or not cl 21(3) of the State Agreement has the effect that any determination by the regulator will not extend to the plaintiffs, will not bind WMC Resources Ltd. That must be so but it is tantamount to an acceptance that the applicant will not be directly affected by any decision in the principal proceedings. Nevertheless, the applicant's submissions proceed on the basis that WMC Resources Ltd is entitled to be joined notwithstanding that position.
65 As indicated earlier in these reasons, WMC Resources Ltd relies on a further argument in support of its claim to be joined in the action. It submits that there is a term implied by law in the Gas Transmission Agreement that the first plaintiff will do all things necessary to enable WMC Resources Ltd to have the benefit of the contract and not to do anything to destroy the efficacy of the bargain – Secured Income Real Estate (Australia) Ltd v St Martins Investments Pty Ltd (1979) 144 CLR 579 and O'Keefe v Williams (1910) 11 CLR 171 at 191. It further submits that the Reference Tariffs proposed by the regulator in the draft decision are significantly lower than the prevailing tariff published by the pipeline owners under the general conditions and that the first plaintiff's participation in the present action in seeking relief to prevent the regulator's decision from extending to the joint venturers is in breach of the implied term because it will tend to deprive WMC Resources Ltd of the benefit of the GTA. In my view it is an extremely doubtful proposition that such a term should be implied in the Gas Transmission Agreement, a contract which is very detailed and comprehensive in its express terms and one obviously reached after extensive negotiations between experienced parties with every access to professional advice.
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66 Considerations which led to the rejection of any implied term to similar effect in Hospital Products Ltd v United States Surgical Corporation (1984) 156 CLR 41 per Gibbs CJ at 65 – 66; Mason J at 1991 and 95 – 96; Wilson J at 118; Deane J at 121 and Dawson J at 139 appear to me to be apposite in the present case, especially with regard to limitations upon the scope of any such term if one were to be implied. Furthermore, it is well established that for any term to be implied in a contract among other things, it must not contradict any express term of the contract – BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266 at 283. The Gas Transmission Agreement was made on 29 September 1998, that is, after the enactment, but before the commencement, of the Gas Pipelines Access (Western Australia) Act 1998 and cl 10(2) plainly contemplates that a different access and tariff regime applying to the pipeline was likely to become applicable. This can only be a reference to the introduction of the uniform laws and, indeed, it was part of the submission by Mr Zelestis QC for the applicant that the GTA was entered into by its parties in the knowledge and expectation that a statutory regime, as eventually enacted, was imminent. That regime included s 97(4) of the Gas Pipelines Access (Western Australia) Act 1998 and cl 2.25 of the Code. I have already examined those provisions and have concluded that, they contemplate that cl 21(3) of the State Agreement would not be qualified or abrogated by the exercise of any powers by the regulator under the Code. Accordingly, an implied term of the broad general nature contended for by Mr Zelestis QC for the applicant would offend the rule requiring consistency with the express contract terms. Confronted with this point, counsel for the applicant then submitted that it was arguable that his client had the benefit of another implied term in the GTA to the effect that, notwithstanding the provisions of cl 21(3) of the State Agreement, the first plaintiff would not avail itself of that clause in order to ensure that WMC Resources Ltd obtained the full possible benefit under the GTA including cl 10(2). While I accept that a term to that effect in a contract between the applicant and the first plaintiff would be valid and enforceable if it existed, this is not a term which I consider could possibly be implied in the GTA for all the reasons already stated.
67 There is a further point. Even if some implied term to the effect contended for by the applicant were to be discerned in the GTA, the most it could do would be to prevent the first plaintiff from seeking to enforce or take advantage of cl 21(3) of the State Agreement. It would not alter the meaning of cl 21(3) or in any way control the manner in which the regulator was obliged to carry out his determination when settling
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- Reference Tariffs. Reliance upon, and attempts to enforce, such a term would not affect the determination of the issues in the principal proceedings, rather, it might prevent the first plaintiff from relying upon any judgment which determines the effect of cl 21(3) of the State Agreement in a manner which would prevent or diminish the application of the regulator's Reference Tariffs decisions, in the first plaintiff's dealings with WMC Resources Ltd alone. This might be enough to ground an application for WMC Resources Ltd to seek a stay of proceedings in the first plaintiff's action or, later, a declaration that any judgment in favour of the plaintiffs in the present proceedings could not be relied upon, or wholly relied upon, by the first plaintiff in its dealings with WMC Resources Ltd under the GTA. Counsel for the applicant indicated that, although those were potential options open to his client, WMC Resources Ltd was more interested in becoming a party to the principal action in order to contest the plaintiffs' claims than seeking a stay against the first plaintiff. This only displays the applicant's desire to contest the rights of the parties under the State Agreement in the principal proceedings rather than to avail of the limited nature of the remedy which any implied term as alleged could confer. For these reasons, I do not consider that the arguments advanced by the applicant relying on one or other of the versions of possible implied terms in the GTA entitle the applicant to be joined in the principal proceedings.
68 As the Full Court held in Homestyle Pty Ltd v City of Belmont (supra), the test propounded for consideration when it is proposed that some other party should be joined as a defendant in proceedings formulated by Lord Diplock in Pegang Mining Co Ltd v Choong Sam (supra) has come to be widely accepted. That acceptance, however, has not overlooked the fact that in the later decision of Vandervell Trustees Ltd v White (supra) the House of Lords determined that the English Rule, as it then was in a form which still corresponds with RSC O 18 r 6(2) in this State, should be more strictly applied than a number of earlier decisions of the Court of Appeal had done. This led Needham J in Walker v Commonwealth Trading Bank of Australia (1985) 3 NSWLR 496 at 502 to observe that the test proposed by Lord Diplock in the Pegang Mining Co case does not seem to be consistent with his Lordship's later remarks in Re Vandervell Trustees Ltd v White (supra) nor with the test suggested by Lord Morris and Viscount Dilhorne. Despite this reservation, the test in Pegang to the effect that the need for joinder will be answered by determining whether the applicant's rights against, or liabilities to any party to the action in respect of the subject matter of the action, will be directly affected by any order made in
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- the proceedings has often been applied. Other cases which have accepted and applied the test in Pegang include News Ltd v Australian Rugby League (1996) 64 FCR 410 at 423 – 5; Gregg v Tasmanian Trustees Ltd (1977) 73 FCR 91; 143 ALR 328 at 360 – 362; Emory University v Biochem Pharma Inc (1998) 86 FCR 1; 157 ALR 371 at 377 and ACCC v News Corporation Ltd (supra) at 153 – 158.
69 Indeed, all the cases, in jurisdictions where the original form of rule O 18 r 6(2) is or was in force at the time, take the approach that some direct effect on the right of the person who is seeking to be joined must be demonstrated before it is necessary to join that person to ensure that all matters in dispute in the cause or matter may be effectually and completely determined and adjudicated upon. Examples where this requirement was applied and joinder refused include Australian Tape Manufacturers' Association Ltd v Commonwealth (1990) 94 ALR 641 at 644; National Australia Bank Ltd v Bond Brewing Holdings [1991] 1 VR 386 at 579 – 580; ACCC v News Corporation Ltd (supra) at 153 – 158 and Emory University v Biochem Pharma Inc (supra). Cases involving the traditional form of the Rule of Court where joinder has been ordered include Foxe v Brown (1984) 58 ALR 542; 59 ALJR 186 per Mason J at ALR (ALJR 187) 545 and Bredvica v Radulovic [1975] VR 434 at 445. These two cases each involved applications by a compulsory statutory insurer to be joined as an additional defendant in an action for damages for personal injuries in circumstances where the plaintiff's action was against a tortfeasor whose liabilities could, eventually, be enforced against the insurer. The basis for the joinder in both cases was that a determination of liability in the principal proceedings against the tortfeasor would create a liability directly enforceable against the insurer in certain circumstances. By contrast, an interest of a financial or commercial kind which did not directly affect the rights of the person seeking to be joined was not regarded as sufficient to justify joinder in National Australia Bank Ltd v Bond Brewing Holdings (supra); Australian Tape Manufacturers' Association Ltd v Commonwealth or ACCC v News Corporation Ltd. The judgment of Hill J in the last case contains a comprehensive analysis of the relevant principles and an examination of the practical criteria to be addressed in applying the test. On the other hand, an example of joinder being ordered because it would be just and convenient to deal with a common issue, under the revised version of the rule then applying in Victoria, is provided by Boral Resources (Vic) Pty Ltd v Robak Engineering & Construction Pty Ltd [1992] 2 VR 507 per Chernov JA at 523 – 4.
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70 There seems to be very little to distinguish the position and interests of WMC Resources Ltd from the situation of the unsuccessful applicant for joinder in Australian Tape Manufacturers Association Ltd v Commonwealth (1990) 94 ALR 641 (HCA). In that case, Dawson J said at 645:
"It cannot, in my view, be successfully argued that merely because a person may have had sufficient standing to contest the validity or invalidity of legislation in a separate action, that person falls within the terms of [HCR] 0 16 r 4(2) as a necessary party in an existing action brought to determine the validity or invalidity of the same legislation."
71 This passage was referred to an applied by Hill J in Australian Competition and Consumer Commission v News Corporation Ltd (1997) 79 FCR 117; 160 ALR 151 when refusing an application for joinder in that case. His Honour said (at ALR 154 – 155):
"As appears from Australian Tape, at least where a constitutional argument is the subject of the proceedings, the fact that the person seeking to be added might himself have brought proceedings raising the same point will not make it necessary to add that person as a party. In such a context it is not sufficient that the person seeking to be joined has an interest in the outcome of the litigation sufficient himself to maintain an action."
72 As stated, the question in the present proceedings is whether or not the draft determination of the regulator will, having regard to the manner in which the decision was taken by the regulator, and particularly in the light of cl 21(3) of the State Agreement apply to the plaintiffs and, if so, to what extent. I have come to the conclusion that the determination of that issue, its adjudication and the formulation of any orders or declarations of the Court to give effect to the ensuing decision will not require any consideration or determination of the effect of the Gas Transmission Agreement or any of its terms. I have also concluded that any order or declaration made in the principal proceedings will not directly affect any of the rights of WMC Resources Ltd. Any effect upon the rights of WMC Resources Ltd will depend upon the proper construction of cl 10(2) of the Gas Transmission Agreement. Admittedly, that determination will inevitably involve the same issue of the extent, if any, to which the regulator's decision on the Reference Tariffs will apply to the first plaintiff in the light of cl 21(3) of the State Agreement, but that is because the two
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- contracts include, one expressly and the other by reference, cl 21(3) of the State Agreement. That does not make them one contract although it reveals the existence of a common issue. In my opinion, that is not sufficient to require or justify joinder under O 18 r 6(2).
73 This conclusion is reinforced by a consideration of the practical problems which would arise if joinder of WMC Resources Ltd were ordered in the current action. It is clear that the plaintiffs do not seek any relief against WMC Resources Ltd, nor do they make any allegations against the applicant. The plaintiffs could hardly be compelled to amend their statement of claim to make allegations which they have no wish to advance or to claim relief against the applicant, if it were to be joined as a defendant. It may be that, if joined, WMC Resources Ltd may wish to bring a counterclaim against the first plaintiff, for a stay of proceedings on the grounds of the alleged implied term or terms, or for a declaration that, under the GTA any decision by the regulator as to Reference Tariffs would apply to it under cl 10(2) of the GTA. However, those claims, even if somehow advanced as counterclaims in the present action, would be claims to declare and enforce rights arising out of the GTA and not the agreement upon which the plaintiffs sue.
74 There appears to me to be much in the submissions of Mr Buss QC for the plaintiffs that, if the applicant considers that it has any cause of action against the plaintiffs or any of them, it should be left to initiate such proceedings as it considers are best calculated to vindicate its claims. If and when such proceedings are commenced, and the issues which they generate can be identified, it may be timely to consider whether or not they raise any common issues which can or should conveniently be determined at the same time as the issues in the present proceedings. If and when that occasion arises, it would also be appropriate to consider, on an application for consolidation or joint trial under RSC O 83, the degree of common interest which the several parties have in the issues arising in the two sets of proceedings and the extent to which the parties in one set of proceedings should be entitled to be heard in the other proceedings and vice versa. It certainly does not follow that, even in the case of a consolidation or a joint trial because of the existence of some common question, the parties to one action should have unrestricted rights to be heard in the other action to which they are not a party.
75 For these reasons I consider that the application by WMC Resources Ltd to be joined in this action should be dismissed.
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