Thompson v Siberia Mining Corporation Pty Ltd - [2021] WASCA 115

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA
TITLE OF COURT :   THE COURT OF APPEAL (WA)
CITATION:   THOMPSON -v- SIBERIA MINING CORPORATION PTY LTD [2021] WASCA 115
CORAM:   BUSS P
BEECH JA
VAUGHAN JA

HEARD:   6 MAY 2021
DELIVERED          :   2 JULY 2021
FILE NO/S:   CACV 76 of 2020
BETWEEN:   MICHAEL ALLAN THOMPSON
Appellant
AND
SIBERIA MINING CORPORATION PTY LTD
First Respondent
JOHN FRANCIS O'SULLIVAN
Second Respondent

ON APPEAL FROM:
Jurisdiction              :   SUPREME COURT OF WESTERN AUSTRALIA
Coram:   TOTTLE J
Citation: SIBERIA MINING CORPORATION PTY LTD -v- O'SULLIVAN [2020] WASC 214
File Number            :   CIV 2036 of 2019

Catchwords:

Mining - Mining Act 1978 (WA) - Expenditure conditions - Exemption from expenditure conditions pursuant to s 102 - Whether work done and money spent on a mining tenement subsequent to the expenditure year the subject of an application for exemption can constitute an 'other reason' for exemption for the purposes of s 102(3) - Whether the mandatory consideration in s 102(4) of work done and money spent on the mining tenement by the holder thereof is limited to work and expenditure up to and including the expenditure year - Whether an 'other reason' for exemption for the purposes of s 102(3) must be of a different character to the reasons for exemption contained in s 102(2)

Legislation:

Mining Act 1978 (WA), s 102(3), s 102(4)

Result:

Appeal dismissed

Category: B

Representation:

Counsel:

Appellant	:	D R Chandler & C A McKenzie
First Respondent	:	T C Russell & L A Shave
Second Respondent	:	No appearance

Solicitors:

Appellant	:	McKenzie & McKenzie
First Respondent	:	Gilbert + Tobin
Second Respondent	:	No appearance

Case(s) referred to in decision(s):

Carnegie Gold Pty Ltd v Maughan [2018] WASC 366; (2018) 240 LGERA 114
Forrest & Forrest Pty Ltd v The Honourable William Richard Marmion, Minister for Mines and Petroleum [2017] WASCA 153; (2017) 51 WAR 425
Haoma Mining NL v Tunza Holdings Pty Ltd [2006] WASCA 19; (2006) 31 WAR 270
Hot Holdings Pty Ltd v Creasy (1996) 185 CLR 149
MH Gold Pty Ltd v Phoenix Rise Ltd [2018] WAMW 13
Nova Resources NL v French (1995) 12 WAR 50
Siberia Mining Corporation Pty Ltd v O'Sullivan [2020] WASC 214
Siberia Mining Corporation Pty Ltd v Thompson [No 2] [2018] WAMW 19
Siberia Mining Corporation Pty Ltd v Wilson [2015] WASC 322

JUDGMENT OF THE COURT:

Introduction

The first respondent (Siberia) is the holder of mining leases 16/262, 16/263 and 16/264. In the expenditure year beginning on 12 March 2010 and ending on 11 March 2011 (the Expenditure Year) Siberia did not comply with the minimum expenditure conditions.[1] Siberia applied for an exemption from the expenditure conditions. The appellant, Mr Michael Thompson, objected to Siberia's exemption application.
[1] Mining Act 1978 (WA), s 82(1); Mining Regulations 1981 (WA), reg 31.
On 14 December 2018, the warden[2] recommended that the Minister for Mines and Petroleum (the Minister) refuse the exemption application.[3]
[2] The warden is the second respondent, and has filed a notice of intention to abide the decision of the court save as to costs.
[3] Siberia Mining Corporation Pty Ltd v Thompson [No 2] [2018] WAMW 19 (warden's reasons).
Under the Mining Act 1978 (WA) (the Act) an exemption from an expenditure condition may be granted for a specific reason set out in s 102(2), or pursuant to s 102(3) which provides as follows:
Notwithstanding that the reasons given for the application for exemption are not amongst those set out in subsection (2), a certificate of exemption may also be granted for any other reason … which in the opinion of the Minister is sufficient to justify such exemption.
In recommending against the grant of an exemption under s 102(3), the warden found that, in order for a reason to be an 'other reason' pursuant to s 102(3), it must be of a different character to the reasons listed in s 102(2). The warden also said that evidence of matters that occur after an exemption application is made (but before the application is considered) is generally not relevant to an application pursuant to s 102(3) and that a reason for exemption must explain why the tenement was under‑expended during the relevant year.
Siberia sought orders for judicial review of the warden's recommendation, contending that the warden erred in law in three respects. The primary judge accepted Siberia's contentions and quashed the warden's decision.[4] His Honour concluded that an 'other reason' pursuant to s 102(3) need not be of a different character to those in s 102(2). Further, while a reason for exemption must consist of matters that existed during the expenditure year, evidence of matters that occurred after the expenditure year may still be relevant. Indeed, by s 102(4), money spent and work done up to the time when the application is considered, including work done and money spent after the expenditure year, is a mandatory consideration. The judge also concluded that a reason for exemption need not justify the under‑expenditure (as opposed to justifying the grant of an exemption). Accordingly, the judge quashed the warden's decision and ordered that the application be reheard and determined according to law.
[4] Siberia Mining Corporation Pty Ltd v O'Sullivan [2020] WASC 214 (primary reasons).
Mr Thompson now appeals against the primary decision, contending that the primary judge erred in his construction of s 102(3) and s 102(4) of the Act. By ground 1, Mr Thompson contends that work done and money spent on a mining tenement subsequent to the expenditure year the subject of the exemption application cannot be determined to be (a) an 'other reason' for exemption and/or (b) a mandatory consideration when determining an application for exemption, and that the judge erred in holding to the contrary. Ground 2 contends that an 'other reason' for exemption under s 102(3) must be of a different character to the reasons set out in s 102(2).
Thus, the issues on appeal are concerned entirely with the proper construction of s 102 of the Act.
For the reasons that follow, we would dismiss the appeal. In summary, in our respectful opinion, the construction of the Act adopted by the primary judge was correct, for the reasons given by his Honour. The judge did not err in the manner alleged by ground 1(a). To the contrary, his Honour adopted the construction the appellant advances by ground 1(a). We do not accept the construction of s 102(4) and s 102(3) advanced by grounds 1(b) and 2 respectively. These grounds each advance a construction of the relevant provision of the Act that seeks to impose a limitation on the general words of the relevant provision, when such a limitation is not sustained by the text, context or purpose of the provision or of the Act as a whole.
We will begin by outlining the statutory framework, before turning to the warden's decision and the decision of the primary judge.

Statutory framework

Section 82(1) of the Act provides that every mining lease shall be deemed to be granted subject to conditions set out in that section. Those conditions include that the holder must 'comply with the prescribed expenditure conditions applicable to such land unless partial or total exemption therefrom is granted in such manner as is prescribed': s 82(1)(c). Failure to comply with the expenditure condition may result in the forfeiture of the lease on an application for forfeiture made under s 98.
The expression 'expenditure conditions' is defined in s 8 as follows:
expenditure conditions in relation to a mining tenement means the prescribed conditions applicable to a mining tenement that require the expenditure of money on or in connection with the mining tenement or the mining operations carried out thereon or proposed to be so carried out[.]
The expenditure condition for a mining lease is prescribed by reg 31 of the Mining Regulations 1981 (WA) (the Regulations).
Section 102 of the Act concerns applications for exemption from the prescribed expenditure conditions. The effect of an exemption is that the holder of the mining tenement is deemed to be relieved, to the extent and subject to the conditions specified in the exemption certificate, from their obligations under the prescribed expenditure conditions for the tenement the subject of the exemption.[5] Section 102 is in the following terms:
[5] The Act, s 103.
102.Exemption from expenditure conditions
(1)Subject to this Act, on an application (an application for exemption) made, as prescribed, by the holder of a mining tenement (other than a retention licence) or his authorised agent prior to the end of the year to which the proposed exemption relates, or within the prescribed period after the end of that year, the holder may be granted a certificate of exemption in the prescribed form totally or partially exempting the mining tenement to which the application relates from the prescribed expenditure conditions relating thereto, in an amount not exceeding the amount required to be expended ‑
(a)in respect to any mining tenement other than a mining lease, in any one year; and
(b)in respect to a mining lease, subject to subsection (7), in a period of 5 years.
(1a)An application for exemption may relate to more than one mining tenement.
(2)A certificate of exemption may be granted for any of the following reasons -
(a)that the title to the mining tenement is in dispute; or
(b)that time is required to evaluate work done on the mining tenement, to plan future exploration or mining or raise capital therefor; or
(c)that time is required to purchase and erect plant and machinery; or
(d)that the ground the subject of the mining tenement is for any sufficient reason unworkable; or
(e)that the ground the subject of the mining tenement contains a mineral deposit which is uneconomic but which may reasonably be expected to become economic in the future or that at the relevant time economic or marketing problems are such as not to make the mining operations viable; or
(f)that the ground the subject of the mining tenement contains mineral ore which is required to sustain the future operations of an existing or proposed mining operation; or
(g)that political, environmental or other difficulties in obtaining requisite approvals prevent mining or restrict it in a manner that is, or subject to conditions that are, for the time being impracticable; or
(h)that -
(i)the mining tenement is one of 2 or more mining tenements (combined reporting tenements) the subject of arrangements approved under section 115A(4) for the filing of combined mineral exploration reports; and
(ii)the aggregate exploration expenditure for the combined reporting tenements would have been such as to satisfy the expenditure requirements for the mining tenement concerned had that aggregate exploration expenditure been apportioned between the combined reporting tenements.
(2a)In subsection (2)(h) -
aggregate exploration expenditure means expenditure -
(a)on, or in connection with, exploration for minerals on the combined reporting tenements; and
(b)worked out in a manner specified in the regulations.
(3)Notwithstanding that the reasons given for the application for exemption are not amongst those set out in subsection (2), a certificate of exemption may also be granted for any other reason which may be prescribed or which in the opinion of the Minister is sufficient to justify such exemption.
(4)When consideration is given to an application for exemption regard shall be had to the current grounds upon which exemptions have been granted and to the work done and the money spent on the mining tenement by the holder thereof.
(5)An application for exemption -
(a)where an objection to the application is lodged, shall be heard by the warden; but
(b)otherwise, shall be forwarded to the Minister for determination by the Minister.
(6)The warden shall as soon as practicable after the hearing of the application transmit to the Minister for his consideration the notes of evidence and any maps or other documents referred to therein and his report recommending the granting or refusal of the application and setting out his reasons for that recommendation.
(7)Where the warden finds that the reasons given by the holder of the mining lease are sufficient to justify the granting of a certificate of exemption and so recommends, or if the Minister is satisfied whether or not a recommendation is made by the warden, the Minister may grant a certificate of exemption in an amount not exceeding the amount required to be expended in respect of the mining lease in the period of 5 years from the commencement of the year to which the application relates.
The 'prescribed period', referred to in s 102(1) is 60 days.[6] An objection to an exemption application must be lodged within 35 days after the date on which the relevant exemption application is lodged, or within such further period as the warden considers reasonable.[7]
[6] The Regulations, reg 54(1a).
[7] The Regulations, reg 146(2).
An applicant for a certificate of exemption is required to lodge an application in the prescribed form, and 'reasons in the form of a statutory declaration supporting the application for the certificate of exemption'.[8]
[8] The Regulations, reg 54(3).
As already noted, where expenditure conditions are not complied with, any person may apply for the forfeiture of the mining licence or lease. An application for forfeiture must be made during the relevant expenditure year, or within eight months thereafter, and the application shall be heard by the mining warden. If the warden finds that the holder of an exploration licence or lessee of a mining lease has not complied with the expenditure conditions, the warden may recommend the forfeiture of the licence or lease; impose a penalty of up to $10,000; or dismiss the application. If a penalty is imposed, the warden may award the whole or part of it to the applicant for forfeiture.[9]
[9] The Act, s 98.
After receiving a recommendation from the warden, the Minister may, as the Minister thinks fit, declare the licence or lease forfeited; alternatively, impose a penalty of up to $10,000; award all or part of any penalty to the applicant for forfeiture; or determine not to declare the licence or lease forfeited, nor impose any penalty.[10] Where an exploration licence or mining lease is forfeited, the applicant for forfeiture has, for 14 days, a right in priority to any other person to mark out and/or apply for a mining tenement of the whole or any part of the land the subject of the forfeited licence or lease.[11]
[10] The Act, s 99.
[11] The Act, s 100(2).
The above provisions reflect and reveal an object of the Act, which was explained in Nova Resources NL v French,[12] as follows:
[To] ensure as far as practicable that land which has either known potential for mining or is worthy of exploration will be made available for mining or exploration. It is made available subject to reasonably stringent conditions and if these, including expenditure conditions, show that the purposes of the grant are not being advanced, then the Act and regulations make provision for others who have an interest in those purposes on that land to apply for forfeiture so they may exploit the area.
[12] Nova Resources NL v French (1995) 12 WAR 50, 57 ‑ 58.
However, as this court observed in Forrest & Forrest Pty Ltd v The Honourable William Richard Marmion, Minister for Mines and Petroleum,[13] that is not the only object of the Act. Other objects or purposes that have been identified by decisions of this court include:
1.identifying circumstances in which a tenement holder will be allowed to hold a mining tenement without mining or giving it up for others who may wish to actively mine the land.
2.protecting tenement holders who have defaulted in compliance with the Act in some minor respect, or because of some circumstances beyond the control of the tenement holder, against loss of the tenement.
3.providing that, in general, the holder of a mining tenement should carry out the relevant mining activity on the tenement. (footnotes omitted)
[13] Forrest & Forrest Pty Ltd v The Honourable William Richard Marmion, Minister for Mines and Petroleum [2017] WASCA 153; (2017) 51 WAR 425 [96].

Factual background

The factual background was not in substantial dispute before the primary judge or before this court. We set it out to provide the context for the warden's decision and the context in which the issues before this court arise. However, it is important to bear in mind that this court's role does not involve any evaluation of the merits of the warden's decision. The primary judge's function was to determine whether the warden had made a jurisdictional error by misconstruing the Act. The two grounds of appeal challenge the primary judge's construction of the Act. Thus, the issues for this court are pure questions of construction. The application of the Act, properly construed, to the facts as found is a matter for the warden.
Siberia is the wholly owned subsidiary of Ora Banda Mining Ltd (Ora Banda). Ora Banda was formerly known as Monarch Gold Mining Ltd. It became known as Swan Gold Mining Ltd (Swan Gold) in 2011 and then Eastern Goldfields Ltd (Eastern Goldfields) in late 2015, before more recently becoming known as Ora Banda.[14]
[14] Warden's reasons [15]; primary reasons [16], [17].
Ora Banda and its subsidiaries held approximately 135 contiguous mining leases near Kalgoorlie, including the three tenements now held by Siberia that are the subject of this appeal: lease number 16/262, lease number 16/263, and lease number 16/264. These three mining tenements are known, respectively, as Iguana, Blue Tongue and Lizard and are known collectively as the Lady Ida tenements.[15]
[15] Primary reasons [17]; warden's reasons [1], [16] ‑ [17].
Ora Banda and its subsidiaries were placed into voluntary administration between 10 July 2008 and 26 February 2010.[16] Prior to being placed in voluntary administration, Ora Banda's primary asset, held through its subsidiaries, was the Davyhurst Gold Project (later named the Carnegie Gold Project), which consisted of an open cut gold project at Davyhurst and an underground gold project in Mt Ida.[17]
[16] Primary reasons [18]; warden's reasons [22], [24].
[17] Primary reasons [18]; warden's reasons [16].
As the judge noted, the warden made factual findings about the events that took place after Ora Banda came out of voluntary administration, including the following:[18]
[18] Primary reasons [30].
(1)In February 2010, Stirling Resources Ltd (Stirling Resources) invested $15 million in Swan Gold and Swan Gold came out of administration. Three creditors' trusts were formed for the benefit of the remaining creditors and the trustee held security over Swan Gold's assets.[19]
[19] Primary reasons [30](a); warden's reasons [24].
(2)Most of the $15 million invested by Stirling Resources was applied to paying Swan Gold's debts.[20] Swan Gold was left with approximately $1.2 million for working capital and it needed to raise more capital to be able to recommence mining operations.[21] There were difficulties in doing so and this led to disputes among Swan Gold's shareholders.[22]
[20] Primary reasons [30](b); warden's reasons [25].
[21] Primary reasons [30](b); warden's reasons [27].
[22] Primary reasons [30](c); warden's reasons [29].
(3)At the beginning of October 2010, the trustee of the creditors' trusts determined that Swan Gold's assets should be put to the market.[23] The following month, the trustee requested that Swan Gold's assets be placed into care and maintenance while it and Swan Gold's Board considered their options.[24]
[23] Primary reasons [30](d); warden's reasons [31].
[24] Primary reasons [30](d); warden's reasons [32].
(4)By December 2010, Swan Gold's available cash was $233,000.[25]
[25] Primary reasons [30](e); warden's reasons [33].
(5)In January 2011, Swan Gold announced that, at the direction of the trustee of the creditors' trusts, it had publicly marketed the assets over which the trustee held security.[26]
[26] Primary reasons [30](f); warden's reasons [35].
(6)In April 2012, Investmet Ltd acquired an interest in Swan Gold with a view to recapitalisation.[27]
[27] Primary reasons [30](g); warden's reasons [38].
(7)Eastern Goldfields' General Manager of Project Development, Mr Andrew Edward Czerw, explained the history of the Swan Gold tenements that made up the Davyhurst Gold Project in the following way:[28]
[28] Warden's reasons [39] quoted at primary reasons [30](h).
In 2006, … the project was on sold to Monarch Resources [who then became Swan Gold]. What Monarch Resources did was they went on the acquisition trail. So they acquired all the ‑ the Riverina tenements off Barrow Resources, the Mount Ida Tenements off Mount Ida Gold and the Siberia and Lady Ida Tenements off the Siberia Mining Corporation and they folded those little microcap companies under the one umbrella. So they did an excellent job of consolidating this very large tenure. So it grew from a very small number of tenements surrounding the processing plant to, basically, the landholding we have today. So it ‑ what that has done is allows a lot of optionality in relation to the future of that processing plant. What they didn't allow themselves to do was allow themselves sufficient time to leverage off that consolidation. So they basically rushed it into production and probably didn't pick the right deposits out to develop first and, as a result of that, they came unstuck …
When the consolidation happened, what happened was all those individual companies had individual drilling databases and they were basically all thrown together in the one database. We're still trying to validate the database as we speak today, because it's such a massive undertaking that we ‑ we can only do it ‑ in a logical way, we can only do it a piece at a time. So we still prioritise the ‑ the re‑evaluation of the ‑ or the ‑ the validation of the database.
The judge took the warden as having accepted Mr Czerw's evidence.[29]
[29] Primary reasons [30](h).
(8)As to the Lady Ida tenements:[30]
(a)Swan Gold intended to do further drilling and further deep drilling in the Lady Ida tenements because not much had been done historically.[31]
(b)When Swan Gold came out of administration, there was a plan for start‑up drilling at three pits ‑ Missouri, Sand King and Riverina. This start‑up scenario did not include the Lady Ida tenements.[32]
(c)Lizard and Iguana could not be developed immediately because they no longer had a miscellaneous licence to connect these tenements to the haulage road. Further, Swan Gold no longer had the relevant environmental approvals.[33]
(d)Iguana was a low grade deposit that required a significant amount of drilling to prove up the resource estimates. Therefore it was considered a medium term target.[34]
(e)A major problem with the Lady Ida tenements was their location ‑ they were not situated near the main road to Davyhurst and that was an issue for haulage.[35]
(f)Mr Dean Bampton, technical manager of Swan Gold, accepted that more work had to be done in relation to Iguana and Lizard before they could determine the viability of mining the resources.[36]
(g)Blue Tongue was significantly smaller and an even lower priority than Iguana and Lizard.[37]
(h)In 2010, Swan Gold's strategy was to re‑commence mining on those parts of the project that had existing legal approval, which did not include Iguana and Lizard. Mr Bampton did not know whether it was viable to mine Iguana[38] and Lizard.[39]
[30] Primary reasons [30](i) ‑ (j).
[31] Warden's reasons [42].
[32] Warden's reasons [43] ‑ [44].
[33] Warden's reasons [45].
[34] Warden's reasons [46].
[35] Warden's reasons [48].
[36] Warden's reasons [50].
[37] Warden's reasons [51].
[38] Warden's reasons [53].
[39] Warden's reasons [54].

On 10 May 2011, Siberia lodged an application for exemption from compliance with the expenditure conditions in respect of Iguana, Lizard and Blue Tongue for the Expenditure Year, namely the period 12 March 2010 - 11 March 2011.[40] The required minimum expenditure, compared to the actual reported expenditure, for these mining leases during the Expenditure Year was as follows:[41]
[40] Primary reasons [21].
[41] Primary reasons [20].

Lease	Required minimum expenditure	Actual reported expenditure
16/262 - Iguana	$99,000	$48,306
16/263 - Blue Tongue	$100,000	$48,643
16/264 - Lizard	$99,100	$63,248

In its exemption application, Siberia advanced six reasons why the grant of an exemption should be recommended. Two of those reasons remain relevant. They were expressed as follows:[42]
Section 102(2)(b) - Time has been required to evaluate work done on the Leases, to plan future exploration/mining and raise capital therefor; and
Section 102(3) - Any other reason which may be prescribed or which in the opinion of the Minister is sufficient to justify such exemption, including matters dealing with the company placing itself into voluntary administration after an unsuccessful debt restricting [sic] program, ongoing discussions with potential investors/buyers and the recent cessation of some of those discussions.
[42] Primary reasons [21].
Mr Thompson lodged an objection to the application on 27 May 2011.[43] The application was heard by Warden Wilson in August 2012 and, on 31 January 2014, Warden Wilson recommended that the exemption be refused.[44] Siberia sought judicial review of the warden's recommendation. On 1 September 2015, Allanson J allowed the application for judicial review, quashed Warden Wilson's decision and directed that the matter be reheard according to law.[45]
[43] Primary reasons [23].
[44] Primary reasons [24].
[45] Primary reasons [26]; Siberia Mining Corporation Pty Ltd v Wilson [2015] WASC 322.
Consequently, Siberia's application was heard by a warden for the second time. The hearing was before a different warden and occurred between 28 November 2017 and 30 November 2017. Siberia filed nine affidavits, which were read at the hearing. Witnesses were examined and cross‑examined. At the conclusion of the hearing, directions were made for the filing and service of written closing submissions. Mr Thompson filed and served his written closing submissions on 29 January 2018. In March 2018 and October 2018, Siberia filed two interlocutory applications seeking, among other things, leave to file further affidavits. Siberia filed its written closing submissions on 12 October 2018.[46]
[46] Primary reasons [27].
It is, with respect to those involved, difficult to see how the timeframes in the two Wardens Court proceedings are compatible with the object of the Act as identified in Nova Resources NL v French.
At bottom this litigation results from under‑expenditure during the year ended 11 March 2011 - a period which came to an end more than 10 years ago. The steps and likely costs in the ensuing litigation are wholly disproportionate to the under‑expenditure. Moreover, focussing on the second hearing in the Wardens Court, it is, in our view, remarkable that following a three day hearing in November 2017 Siberia did not file written closing submissions until some ten and a half months later - and then only after seeking leave to reopen to adduce further affidavit evidence having already filed comprehensive affidavit material in anticipation of the hearing.
If the object of the Act as identified in Nova Resources NL v French is to be achieved it is necessary that applications for exemption be resolved in a timely way and that litigants comply with the precept that such litigation is to be conducted justly, quickly and cheaply. The failure to do so in this case is conspicuous.
We hasten to add that this failure ought not be attributed to the warden. The warden delivered his reasons within a little over two months after the belated filing of Siberia's written closing submissions.
At the hearing in November 2017, Siberia advanced two reasons why a certificate of exemption should be recommended, summarised as follows in its outline of submissions:[47]
[47] Quoted at warden's reasons [4].
5.In summary, the Application ought to be recommended for grant for the following reasons:
(a)Under section 102(2)(b), given the significant efforts to obtain funding during the Expenditure Year, and the exploration planning conducted during the Expenditure Year; and
(b)Under section 102(3), having regard to:
(i)The difficult circumstances of the company during the Expenditure Year (having just emerged from Administration on 26 February 2010)[;]
(ii)The expenditure and exploration on the Mining Leases since the end of the Expenditure Year;
(iii)The mineralisation on the Mining Leases and the company's plan to recommence mining at the Davyhurst Gold Project;
(iv)The realisation of the company's plan following the Expenditure Year; and
(v)The planned development of the Mining Leases as part of the Davyhurst Gold Project.

The warden's reasons

The warden recommended that the Minister should refuse to grant certificates of exemption for the Lady Ida tenements for the Expenditure Year.
After outlining the background, the legislative framework, relevant legal principles and making findings of fact, the warden dealt in turn with the two reasons relied on by Siberia for why an exemption should be granted.

Exemption under s 102(2)(b)

It is convenient to reproduce s 102(2)(b), which provides as follows:
(2)A certificate of exemption may be granted for any of the following reasons -
…
(b)that time is required to evaluate work done on the mining tenement, to plan future exploration or mining or raise capital therefor; or[.]
Siberia did not suggest that time was required to evaluate work done on the Lady Ida tenements. Consequently, to fall within s 102(2)(b), Siberia needed to establish that time was required to plan future exploration or mining or raise capital therefor.[48] The warden concluded that Siberia had not established this and so was not entitled to an exemption under s 102(2)(b).[49] The warden gave two reasons for so concluding.
[48] Warden's reasons [57].
[49] Warden's reasons [66].
First, the warden concluded that capital raising was undertaken during the Expenditure Year, but not for the purpose of developing the Lady Ida tenements - rather, it was undertaken to facilitate the development of the Missouri, Sand King and Riverina start‑up pits.[50] The warden said that, to fall within s 102(2)(b), the relevant capital raising needed to have been undertaken for the purpose of developing the tenements the subject of the exemption application.[51]
[50] Warden's reasons [59].
[51] Warden's reasons [60], referring to MH Gold Pty Ltd v Phoenix Rise Ltd [2018] WAMW 13 [28] - [51].
Secondly, the warden concluded that there was insufficient evidence to demonstrate that there was any plan for future exploration or mining of the Lady Ida tenements. The evidence was that the viability of the Lady Ida tenements had not yet been ascertained and that there were unresolved problems as regards environmental licenses, a miscellaneous licence, and haulage. This was consistent with the fact that the Lady Ida tenements were not considered a priority.[52]
[52] Warden's reasons [61] ‑ [65].
The warden's conclusions in these respects were not challenged before the primary judge, and so are not in issue in this court. However, they provide context for the warden's reasoning in relation to s 102(3).

The warden's construction of s 102(3)

Before dealing with the grounds relied on by Siberia in support of its application under s 102(3), the warden made general observations about s 102(3). The warden commented that the absence of words of limitation in s 102(3) does not mean that the power contained therein is otherwise unfettered. His Honour observed that the nature and extent of the power must be inferred from the Act read as a whole. Further, he said, whether the circumstances relied on by the applicant constituted a sufficient reason for an exemption is to be determined having regard to the Act's subject matter, scope and purpose.[53]
[53] Warden's reasons [71].
His Honour then said the following as to s 102(3):[54]
Section 102(3) provides for an exemption if some 'other' sufficient reason is established. This calls for the identification of some reason other than those enumerated in s 102(2) and not merely a re‑agitation of one or other of the grounds in s 102(2).
In MH Gold v Phoenix [Rise [2018] WAMW 13 [267] ‑ [276] (MH Gold)], whilst acknowledging that each case will depend on its own facts, I made a number of observations about the operation of s 102(3). I adopt those observations without repeating them. (original emphasis) (footnotes omitted)
[54] Warden's reasons [72] - [73].
The observations in MH Gold to which the warden referred includes the following:[55]
Section 102(2) sets out the specific circumstances in which an exemption from expenditure can be granted. The matters enumerated in s 102(2) represent a range of common problems encountered by tenement holders the legislature has determined may, if established, give rise to an exemption.
Section 102(3) acknowledges that even a prudent and diligent tenement holder may be confronted by circumstances that are sufficient to justify an exemption even though those circumstances do not fall within the grounds of exemption in s 102(2). Once [sic] such example might be a shortage of skilled labour.
By imposing an obligation on tenement holders to expend or risk exposing the tenement to the risk of forfeiture, whilst allowing for exemptions in certain circumstances, the Mining Act seeks to strike a balance between penalising those who do not mine or explore their tenements and providing security of tenure so as to encourage investment in mining. If a tenement holder was to face the risk of forfeiture every time it was confronted with matters beyond its control, investing in mining may be seen as too risky.
In my view, s 102(3) directs attention to the identification of a sufficient reason that is of a different character to those in s 102(2). It follows that a tenement holder should not receive an exemption under s 102(3) simply because it failed to establish one of the grounds in s 102(2). Not only does the language used in s 102(3), in particular the word 'other', support such a construction but it would undermine the purpose of s 102(2), if s 102(3) was used to subvert or relax the requirements imposed by the grounds in s 102(2).
While the circumstances to which s 102(3) extends is unlimited and each case will depend on its own facts, I doubt it was intended it be used to agitate what is in reality a ground to which s 102(2) relates that the tenement holder accepts it could not establish or failed to establish having attempted to do so.
In short, where the legislature has by s 102(2) stipulated the circumstances capable of giving rise to an exemption, the criteria or limitations that apply to each subparagraph of s 102(2) should not be ignored.
For example, where a tenement holder is not eligible for an exemption under s 102(2)(h) because expenditure across the combined reporting group in connection with exploration fails to meet the minimum requirement, it is doubtful an exemption under s 102(3) should be granted on the basis that expenditure of mining activities across the group exceed the minimum requirement. The legislature having expressly turned its mind to the circumstances in which expenditure across a group of tenements can be aggregated, it is unlikely it intended that the general power in s 102(3) could be used in a way that is inconsistent with that objective. (emphasis added, citations omitted)
[55] MH Gold v Phoenix Rise [269] - [275].
This aspect of the warden's approach to Siberia's application was challenged by ground 1(a) and (b) of Siberia's application for judicial review. The judge upheld the challenge, finding that the warden had misconstrued the Act. The judge's conclusion is challenged before this court by ground of appeal 2. As will be seen, we agree with the primary judge.

The warden's assessment of the factors relied on by Siberia under s 102(3)

The warden then considered the factors, set out at [32] above, that Siberia advanced in support of its application for exemption under s 102(3). In his view, none of them individually or collectively supported the grant of exemptions for the Lady Ida tenements.[56]
[56] Warden's reasons [74].
Factor (i) concerned Swan Gold's difficulties after emerging from administration. The warden summarised these difficulties as follows: Swan Gold was mandated to use a substantial portion of the re‑capitalisation from Stirling Resources for paying debts; Swan Gold, therefore, needed to raise further capital in order to recommence mining operations; and Swan Gold struggled to do so.[57] The warden said this was[58]
in reality, a re‑agitation of [the matters] advanced in relation to s 102(2)(b) albeit expressed with a greater degree of generality. A tenement holder needing to raise capital is exactly what s 102(2)(b) is directed to.
The warden then repeated his observation that to fall within s 102(2)(b), the capital had to have been raised for the tenements the subject of the application, which was not the case.[59]
[57] Warden's reasons [77].
[58] Warden's reasons [78] ‑ [79].
[59] Warden's reasons [79].
The warden next dealt with factors (ii) and (iv): '[t]he expenditure and exploration on the mining leases since the end of the Expenditure Year' and '[t]he realisation of the company's plan following the expenditure year'. The warden observed that both these grounds relied on events after the expiry of the Expenditure Year and that neither ground explained why the minimum expenditure requirement for the tenements had not been met during the Expenditure Year. The warden observed that these were matters relevant to the question of forfeiture in the event that the Minister did not grant the exemption application. However, the warden identified an exception ‑ in other words, a situation where events after the Expenditure Year would be relevant to an application for exemption - namely, where the development of a tenement after the relevant expenditure year demonstrates that time was required during the expenditure year to plan for future exploration or mining or to raise capital therefor.[60] That exception had little or no application to the present case because, the warden found, there had been limited development of the Lady Ida tenements since the Expenditure Year.[61] The prospect that the tenements could be developed in the distant future would do little to establish a ground of exemption in respect of the Expenditure Year.[62]
[60] Warden's reasons [85].
[61] Warden's reasons [86].
[62] Warden's reasons [88].
The warden then turned to grounds (iii) and (v), namely '[t]he mineralisation on the Mining Leases and the company's plan to recommence mining at the Davyhurst Gold Project' and '[t]he planned development of the Mining Leases as part of the Davyhurst Gold Project'. The warden characterised the argument advanced by these factors as involving the following propositions:[63]
(a)The tenements were part of a project and as long as capital was being raised to advance the project then an exemption under s 102(3) ought to be granted.
(b)It does not matter that there was no immediate plan to develop the tenements, so long as they remained part of the project and would be developed in accordance with priority accorded to those tenements within the project.
(c)Acquiring and holding multiple tenements on the basis that they will be developed in a staged approach is consistent with the objects of the Act.
(d)While a staged approach to development is unfolding, the holder of the tenements is entitled to an exemption under s 102(3) or s 102(2)(b) as long as capital raising for the project or some of the tenements in the project takes place during the expenditure year.
(e)An exemption may be sought on the basis that capital raising is occurring to develop one or some of the tenements within the project with a view to those tenements becoming operational and the proceeds then being used to fund the development of the other tenements in the project, including those for which an exemption is sought.
[63] Warden's reasons [89] - [92].
The warden identified three difficulties with Siberia's argument, which he termed the 'project' argument:
(1)It does not promote the objects of the Mining Act, in particular the primary object that land that has known or possible mining potential is available for mining or exploration. If the Act were interpreted in a manner that permits a tenement holder to warehouse tenements, while focussing its resources on other tenements, large areas of land could be tied up indefinitely. The Act did not support security of tenure 'at all costs'. To permit this would undermine the operation of s 102(2)(b) which requires tenement holders to be actively raising capital in relation to the tenements for which an exemption is sought. None of the reasons in s 102(2) would encourage a tenement holder to warehouse tenements while they focus on other tenements. The evident purpose of that scheme is to discourage the acquisition by a tenement holder of more tenements than the holder can reasonably develop.[64] His Honour then stated:[65]
Having regard to the history of Swan Gold's acquisition of these tenements provided by Mr Czerw, this is exactly what has occurred in this case. Monarch (as Swan Gold then was) took on more tenements than it could handle and has struggled to develop them since. It has also had difficulty planning for future exploration or mining because it had not examined all of the data it received.
(2)Section 102(2)(b) deals expressly with capital raising and requires that any capital raising relate to the tenements for which an exemption is sought. Consequently, a project ground of exemption, which relies on capital raising for tenements other than those for which exemption is being sought, would undermine the operation of that provision.[66]
(3)The legislative history of the Mining Act revealed that the legislature has considered and has addressed the circumstances in which an exemption may be granted for a tenement that is part of a project. A project ground of exemption is not available unless the circumstances relied upon by the applicant come within s 102(2)(h).[67]

The warden's view of the relevance of s 102(4)

[64] Warden's reasons [94] - [101].

[65] Warden's reasons [102].

[66] Warden's reasons [106] - [107].

[67] Warden's reasons [108] - [113].

Mr Thompson's submissions pointed out that Siberia had applied for exemptions in respect of the Lady Ida tenements in 2007, 2009 and 2010 and in respect of Iguana and Lizard in 2008. The warden concluded that none of the matters referred to in s 102(4) would assist Siberia.[68]

Siberia's applications to adduce fresh evidence

[68] Warden's reasons [116] - [117].

The warden considered and rejected Siberia's applications to adduce fresh evidence. In the course of doing so, the warden reiterated his conclusion that he had difficulty seeing how events after the Expenditure Year explained why the Lady Ida tenements were under‑expended during the Expenditure Year. Consequently, he considered that much, if not all, of the evidence that was the subject of objection by Mr Thompson was irrelevant.[69]
[69] Warden's reasons [121] - [126].

Siberia's application for judicial review

Siberia relied upon the following grounds in its application for judicial review of the warden's decision:
1.The Warden erred in law by misapplying the legal test for exemption under s 102(3) of the Mining Act 1978 (WA) (Mining Act) in three respects:
(a)the Warden erroneously considered that grounds for exemption advanced under s 102(3) cannot encompass arguments that relate to matters the subject of ss 102(2)(a) - (h), but in respect of which exemption was not sought under ss 102(2)(a) - (h);
(b)the Warden failed, when considering whether to recommend the grant or refusal of an exemption under s 102(3) of the Mining Act, to take into account grounds for exemption that had been advanced under both ss 102(2)(b) and 102(3), but that the Warden considered were insufficient to ground an exemption under s 102(2)(b); and
(c)the Warden erroneously found that evidence of matters that occurred after the end of the twelve month period beginning on 12 March 2010 and ending on 11 March 2011 (Expenditure Year) was not relevant to the Applicant's claim for exemption from expenditure under s 102(3) of the Mining Act because those matters did not explain why the minimum expenditure commitment for the Mining Leases was not met during the Expenditure Year.
2.As a consequence of the errors in 1(a), 1(b) and 1(c) above, the Warden failed to consider relevant materials, including the affidavits of Michael George Fotios dated 1 March 2018 and 27 August 2018 and the affidavit of Andrew Edward Czerw dated 11 October 2018.

The primary judge's reasons

Summary

In the introduction to his Honour's reasons, the judge summarised the issues for his determination as follows:[70]
[70] Primary reasons [2] ‑ [3].
This case concerns the discretion in s 102(3) of the Mining Act 1978 (WA) (the Act) to grant exemptions from the expenditure conditions applicable to mining tenements and in particular, the construction of the expression 'any other reason ... which in the opinion of the Minister is sufficient to justify such exemption' as it appears in that subsection. The questions to be determined may be expressed as follows:
(a)Is the 'reason' required to be of a different character to the reasons specified in s 102(2) of the Act?
(b)Is the 'reason' required to exist at the time the application is made or may the Minister grant an exemption on the basis of a reason which has arisen in the period between the date on which the application is made and the date on which it is determined?
(c)Is the 'reason' required to explain or justify why the expenditure conditions have not been satisfied or (potentially in the case of a mining lease), will not be satisfied?
There is a subsidiary issue concerning the construction of s 102(4), that is, whether the expression 'the work done and the money spent on the mining tenement' extends to work done and money spent between the date of the application for exemption and the date on which the application is considered, or whether it is limited to work done and money spent up to the date of the application.
The judge then set out the relevant legislative framework and factual background. His Honour summarised the warden's reasons and the parties' submissions on the application for judicial review, before setting out general principles, the statutory objects and contextual matters relevant to construing s 102 of the Mining Act. His Honour then turned to consider each of the above issues. The judge's conclusions were as follows:
(1)His Honour answered issue (a) in the negative.
(2)As to issue (b), the judge concluded that the 'reason' or 'reasons' for exemption must exist in the expenditure year to which the application relates and thus must exist at the time the application is made. However, in response to the subsidiary issue, the words in s 102(4) ‑ 'work done and the money spent on the mining tenement' ‑ extend to work done and money spent between the date of the application for exemption and the date on which the application is considered. Indeed, work done and money expended up to the date of consideration of the application is a mandatory consideration.
(3)The judge answered issue (c) in the negative.
The judge concluded that grounds 1(a) ‑ (c) had been established.[71] As to ground 2, his Honour found that the warden had erred in his approach to considering Siberia's applications to adduce fresh evidence,[72] but ultimately left it for the warden to consider, in light of the judge's reasons, the relevance of the evidence that Siberia sought to adduce.[73] The judge made orders quashing the warden's decision and ordering that the matter be reheard and determined according to law.[74]

Availability of judicial review

[71] Primary reasons [84], [87].

[72] Primary reasons [94].

[73] Primary reasons [98].

[74] Primary reasons [104].

It was not in dispute before the primary court,[75] and is not in dispute before this court, that judicial review was available in relation to the warden's decision to recommend the refusal of a grant of an exemption.[76]

Statutory objects and contextual matters

[75] Primary reasons [48].

[76] Hot Holdings Pty Ltd v Creasy (1996) 185 CLR 149, 174.

The judge explained that s 102(1) enables the holder of a tenement to apply for the grant of a certificate of exemption 'totally or partially exempting the mining tenement to which the application relates from the prescribed expenditure conditions relating thereto'.[77] While the public interest is served by ensuring that tenement holders exploit tenements held by them, s 102 recognises that circumstances will arise where a tenement holder ought to be relieved from their expenditure obligations. Because a tenement holder who applies for a certificate of exemption is applying for dispensation from compliance with the statutory requirement imposed to fulfil the public interest, an application for exemption inevitably directs attention to why the expenditure conditions have not been, or will not be, satisfied.[78]
[77] Primary reasons [60].
[78] Primary reasons [60].
The judge noted that a certificate of exemption relieves the tenement holder of the obligation to comply with the expenditure conditions, rather than relieving the tenement holder from the consequences of non‑compliance.[79]
[79] Primary reasons [61].
His Honour also observed that s 102(2) specifies reasons that may justify the grant of a certificate of exemption and that the reasons specified in s 102(2) do not, generally speaking, focus on 'under‑expenditure'. In terms, the reasons specified in s 102(2) do not require a tenement holder to explain non-compliance. Nevertheless, the judge noted that each reason specified in s 102(2) describes factual circumstances which, in effect, may provide an explanation as to why the tenement holder has failed to meet the relevant expenditure conditions. In other words, the judge said, each reason in s 102(2) may be seen as both a reason as to why a certificate of exemption may be granted and a reason or explanation as to why the expenditure conditions have not been or will not be satisfied.[80]
[80] Primary reasons [62].
Finally, the judge observed that each reason in s 102(2) is constituted by a state of affairs that exists at the time the application is made or, in respect of an application made prospectively, is anticipated will exist in future expenditure years.[81]

Issue (a): an 'other reason' need not be of a different character to the reasons in s 102(2)

[81] Primary reasons [63].

The judge concluded that an 'other reason' for the purposes of s 102(3) need not be of a different character to the reasons specified in s 102(2).
The judge said that there was no textual warrant within s 102(3) for a limitation of this kind. The only express limitation on the reasons that may justify the grant of an exemption under s 102(3) is that the reason is 'not amongst those set out in subsection (2)'.[82]
[82] Primary reasons [64].
Further, the judge said, s 102(3) contains a broad discretion to grant an exemption for reasons other than those specified in s 102(2). The breadth of this discretion is reinforced by s 102(7), which says that the Minister may grant an exemption 'whether or not a recommendation is made by the warden'.[83] Similarly, his Honour said that s 102(2) and s 102(3) are separate pathways to the grant of an exemption and the fact that specific reasons for exemption are listed in s 102(2) does not confine the breadth of the discretionary power in s 102(3).[84]
[83] Primary reasons [65].
[84] Primary reasons [66].
Finally, the judge noted that the discretion in s 102(3) is bounded by the subject matter, scope and purpose of the Mining Act.In this regard, the wide array of circumstances that are capable of affecting mining activities (for example, geological, economic, environmental, political, financial and legal) suggests that s 102(3) should be construed broadly. A combination of reasons which, individually, may not satisfy any of the criteria within s 102(2) may nonetheless ground the grant of an exemption pursuant to s 102(3) of the Mining Act.[85]
[85] Primary reasons [67].
The judge's conclusions on issue (a) are challenged by ground 2.

Issue (b): the reasons upon which an application is based must exist when the application is made

The judge concluded that the reason or reasons that justify the grant of an exemption must exist in the expenditure year to which the application relates and thus they must exist when the application is made.[86] As regards applications for exemption for future years, made in respect of mining leases, the material facts which constitute a reason or reasons will include an expectation that circumstances will exist in the years to which the application relates that justify the exemption.[87]
[86] Primary reasons [68].
[87] Primary reasons [68], [69](b).
The judge then set out, in nine subparagraphs, his Honour's reasons for this conclusion.
The conclusion that a reason or reasons must exist during the expenditure year flows, the judge said, as a reality from the requirement that an application for exemption must be made during the expenditure year or within the prescribed period of 60 days thereafter. The prescribed period does not extend the expenditure year; it provides an opportunity to assess whether an application should be made. Accordingly, the word 'reason' in s 102(3) should be construed to mean a reason constituted by facts that exist (or, in the case of an application in respect of a mining lease made prospectively, are expected to exist) in the expenditure year.[88]
[88] Primary reasons [69](a) ‑ (c).
However, the judge said, although the reason or reasons for exemption must be constituted by facts that occurred during the expenditure year, '[t]his is not to say that … evidence of subsequent events may not be relevant to reasons given to justify the grant of an exemption which exist in the expenditure year'. Such evidence may advance the strength or legitimacy of the reasons given.[89] In so observing, the judge foreshadowed his conclusion on the subsidiary issue, detailed below.
[89] Primary reasons [69](c).
The judge acknowledged that s 102(3) does not contain any express temporal limit on the word 'reason'. However, this absence is explained by the fact that an application for exemption must be made during, or within 60 days after, the relevant expenditure year. This requirement itself imports a temporal limitation on the word 'reason'.[90]
[90] Primary reasons [69](d).
The judge also referred to the objects of the Act. An object of the Mining Act is to encourage those in the mining industry to monitor whether others in the industry are complying with expenditure conditions and to act on non‑compliance by objecting to exemption applications and by making forfeiture applications. It would discourage others in the industry from acting, and would prejudice an objector or applicant for forfeiture, if a tenement holder were able to rely on matters after the expenditure year as a reason or reasons for the grant of an exemption in respect of that expenditure year. In this manner, it would undermine the policy of self‑regulation.[91]
[91] Primary reasons [69](e).
Further, it would encourage delay if 'any other reason' could be constituted by matters that occurred after the expenditure year. It would benefit applicants for exemption to delay proceedings in the hope that 'something will turn up'. This would be contrary to the Act's object of ensuring that matters affecting the security of tenure are resolved expeditiously.[92]
[92] Primary reasons [69](f).
Finally, that reasons for exemption must be constituted by matters that exist during the expenditure year is consistent with the fact that expenditure conditions are assessed, and must be satisfied, annually.[93]
[93] Primary reasons [69](g).
The judge acknowledged that the breadth of the discretion contained in s 102(3)[94] supports the opposite construction of 'any other reason', namely, that 'any other reason' can be constituted by matters that have occurred after the relevant expenditure year. However, the judge said, the construction he favoured best aligns with the Act's objects and the requirement that applications for exemption be made during or within 60 days after the expenditure year, as explained above.[95]

Subsidiary issue: work done and money expended up to the consideration of the application is a mandatory consideration

[94] While his Honour referred in this context to s 102(2), it is evident that the reference was intended to be to s 102(3).

[95] Primary reasons [69](h).

As the judge explained, s 102(4) requires regard to be had to two mandatory considerations 'when consideration is given to an application for exemption', namely:
(a)the current grounds upon which exemptions have been granted; and
(b)the work done and the money spent on the mining tenement by the holder thereof.
The judge observed that these are not reasons for granting an exemption, but the Minister must consider them in determining whether to grant an exemption.[96]
[96] Primary reasons [71] ‑ [72].
The first mandatory consideration requires the Minister to have regard to the current grounds relied upon for exemption that have previously resulted in the grant of exemption in respect of the tenement the subject of the application.[97]
[97] Primary reasons [73], referring to Haoma Mining NL v Tunza Holdings Pty Ltd [2006] WASCA 19; (2006) 31 WAR 270 [57], [60].
Relevantly, the second mandatory consideration requires the Minister to consider work done and money spent up to the date of consideration of the application, not just up to the date the application was made. In support of this construction the judge pointed out the introductory words to the subsection ‑ '[w]hen consideration is given' ‑ combined with the use of past tense in the phrase 'work done and money spent on the mining tenement by the holder thereof'.[98] Evidently, the judge highlighted these features of the text because: (a) the past tense phrases 'work done' and 'money spent' indicate that the mandatory consideration is backwards facing; (b) the opening words, 'when consideration is given', indicate that the time at which the Minister must look back on the work done and money spent is when 'consideration is given' to the exemption application; and (c) therefore, the phrase 'work done and money spent' includes all work done and money spent up to the time when the application is considered.
[98] Primary reasons [74].
The judge referred to four further matters in support of his construction. First, while the first of the mandatory considerations necessarily refers to expenditure years that precede the application, there is syntactically no reason why the second mandatory consideration should refer to work done and money spent prior to when the application was made, as opposed to prior to when the application is considered.[99]
[99] Primary reasons [75](a).
Secondly, the subsection does not refer to any date, other than the date on which 'consideration is given to the application'. Had the legislature intended to require the Minister to consider only work done and money spent prior to when an application is made, words to that effect could readily have been included.[100]
[100] Primary reasons [75](b).
Thirdly, the objects of the Mining Act do not call for 'work done and money spent' to be construed as work done and money spent prior to when an exemption application is made. The policy of self‑regulation, as described above, does not have the same significance in this context. Objectors and applicants for forfeiture are aware that further work may be done, and more money may be spent, on the tenement the subject of the application between the making of the exemption application and the consideration of the application. This risk is known and is therefore qualitatively different from a 'reason' for exemption arising after the relevant expenditure year and before the application is considered.[101]
[101] Primary reasons [75](c).
Fourthly, this broad construction of s 102(4) is, in the judge's view, supported by the objects of the Act as identified in [18] above.[102]
[102] Primary reasons [75](d).
The judge's conclusions on this subsidiary issue concerning s 102(4) are challenged by ground 1(b).

Issue (c): the reason or reasons for exemption need not explain or justify the under‑expenditure

The judge considered that this question concerns a 'finely balanced constructional choice'.[103] The judge acknowledged that there are factors that suggest that 'other reasons' for exemption must explain or justify the applicant's non‑satisfaction of the expenditure requirement, which he summarised as follows:[104]
On the one hand, the public interest in tenement holders exploiting tenements held by them coupled with the requirement that the Minister form the opinion that the reason is sufficient to justify the exemption, supports a construction that requires the reason to explain or justify non‑expenditure. It is difficult to conceive a reason for granting an exemption that did not relate to the non‑compliance with the expenditure conditions. Further, s 102(3) cannot be divorced from its context. The purpose of the exemption is to relieve the applicant of the requirement to comply with the expenditure conditions in certain circumstances. Viewed from that perspective, to require the reason relied upon to be one that must explain or justify the non‑compliance with the expenditure conditions is unexceptional and conforms with the statutory objects to which I have referred earlier. It may also be seen as consistent with the rationale that underlies the reasoning of the High Court in Forrest & Forrest v Wilson in the passage cited earlier. (original emphasis)
[103] Primary reasons [76].
[104] Primary reasons [77].
However, the following reasons led the judge to instead conclude that the discretion conferred by s 102(3) is not conditioned by a requirement that 'other reasons' explain the non‑compliance with the expenditure conditions:
(1)There is no textual warrant for such a condition. Rather, the language of the provision is consistent with the grant of a broad discretion. It requires a reason that justifies the exemption, not a reason that justifies the non-compliance with the expenditure conditions.[105]
(2)The Minister is entitled to take into account matters of broad policy and principle in deciding whether to grant a licence or lease and, in the absence of any textual warrant, there is no reason why the Minister should not have equally wide discretion in deciding whether to grant an exemption.[106]
(3)The mandatory considerations in s 102(4) are not confined to matters that explain the non‑compliance in the expenditure year. It would therefore sit uncomfortably with s 102(4) if the Minister were, by that subsection, required to take into account matters that did not explain the non‑compliance but the Minister's discretion was otherwise limited to granting exemptions for reasons that explain or justify non‑compliance.[107]
(4)The judge's construction of s 102(3) is consistent with Archer J's reasoning in Carnegie Gold Pty Ltd v Maughan,[108] in which her Honour held that non‑compliance with expenditure conditions is not a pre‑requisite of a valid application for an exemption.[109]
[105] Primary reasons [80].
[106] Primary reasons [81].
[107] Primary reasons [82].
[108] Carnegie Gold Pty Ltd v Maughan [2018] WASC 366; (2018) 240 LGERA 114.
[109] Primary reasons [83].
The judge's conclusion on issue (c) is not challenged by any ground of appeal.

Ground 1

Having considered each of the construction issues posed by Siberia's application for judicial review, the judge stated his conclusions on Siberia's grounds.

Grounds 1(a) and (b)

His Honour concluded that grounds 1(a) and (b) were established. An 'other reason' for the purposes of s 102(3) need not be a reason of a different character to those in s 102(2). Accordingly, the warden made an error of law on the face of the record which, in this case, constituted a jurisdictional error.[110]
[110] Primary reasons [84].
Mr Thompson had submitted to the primary judge that, even if the warden was incorrect in his construction of s 102(3), the warden did in fact consider each of the matters that Siberia relied upon in its application in respect of s 102(3). Therefore, it was said, the warden had not erred.[111] The judge rejected this submission, observing that the warden's error was material and that it was not possible to conclude that the error did not affect the warden's decision‑making process.[112] This conclusion is not challenged on appeal.
[111] Primary reasons [54](a).
[112] Primary reasons [85].

Finally, the judge observed that, as a practical matter, if a reason is unsuccessful in falling within any of the criteria specified in s 102(2), it may not, without more, be sufficient to persuade a warden to recommend the grant of an exemption pursuant to s 102(3). However, that reason, together with others, may constitute an 'other reason' that justifies an exemption under s 102(3).[113]

Ground 1(c)

[113] Primary reasons [86].

The judge concluded that ground 1(c) was established.
The warden erred in that, when assessing factors (ii) and (iv) (see [46] above), the warden considered that these did not explain why the tenements were under‑expended and therefore (implicitly) considered them irrelevant.[114]
[114] Primary reasons [87].
That revealed an error of law because, as the judge had found, work done and money spent up to the date of consideration of the application is a mandatory consideration. The judge acknowledged that the warden had regard to some work done after the Expenditure Year, but said that the extent of the warden's consideration was unclear.[115] Further, a reason for exemption advanced under s 102(3) is to be assessed by reference to whether the reason justifies the exemption, and not whether it explains or justifies non‑compliance with the expenditure conditions.[116]
[115] Primary reasons [88].
[116] Primary reasons [89].
The judge concluded that the warden made an error of law on the face of the record which constituted a jurisdictional error.[117]

Ground 2

[117] Primary reasons [90].

The judge observed that the warden erred in his approach to Siberia's applications to adduce fresh evidence because he was guided by erroneous constructions of s 102(3). In particular, the warden's view was that the evidence that Siberia sought to adduce had to explain why the minimum expenditure conditions were not met.
Nonetheless, the judge expressed reservations about whether the evidence that Siberia sought to adduce was, in any event, relevant to what the warden was required to address.[118] The judge also said the warden was correct in approaching Siberia's applications with caution, given that the power to re‑open evidence is to be exercised sparingly.[119]
[118] Primary reasons [95].
[119] Primary reasons [97].
Finally, the judge said that he had not received detailed submissions from the parties on ground 2, and that determining this ground was not critical to the outcome of the application. Accordingly, his Honour left the relevance of the fresh evidence to be determined by the warden in light of the judge's reasons.[120]

Discretionary grounds for refusing relief

[120] Primary reasons [98].

The judge rejected Mr Thompson's submission that Siberia should be denied relief on discretionary grounds, specifically, on the basis that relief would be futile[121] and that there had been undue delay in bringing the application for judicial review.[122] There is no challenge on appeal to those conclusions.
[121] Primary reasons [101] ‑ [102].
[122] Primary reasons [103].

Grounds of appeal

Mr Thompson appeals against the primary judge's decision on the following two grounds, both of which allege errors in his Honour's construction of the Act:
1.The learned trial judge erred in law in construing [s] 102(3) and [s] 102(4) of the Mining Act 1978 (WA) so that work done and money spent on a mining tenement subsequent to the expenditure year the subject of an application for exemption can be determined to be (a) an other reason for exemption, and/or (b) a mandatory consideration when determining an application for exemption: at [74], [75], [82], [88], [99].
2.The learned trial judge erred in law in construing s 102(3) of the Mining Act so that exemption may be granted for a reason that does not satisfy the criteria of the reasons set out in s 102(2) and is of the same character as those reasons, whereas properly construed exemption may only be granted under s 102(3) for a reason not amongst and of a different character to the reasons set out in s 102(2): at [64], [66], [67], [84].

Ground 1: work done and money spent on a mining tenement subsequent to the Expenditure Year

As can be seen, by ground 1, Mr Thompson contends that the primary judge erred in construing s 102(3) and s 102(4) to mean that work done and money spent on a mining tenement subsequent to the relevant Expenditure Year could be (a) an 'other reason' for exemption and/or (b) a mandatory consideration when determining an application for an exemption.

Ground 1(a)

It can be said at once that the judge did not, as ground 1(a) asserts, hold that subsequent expenditure can be an 'other reason' for exemption. To the contrary, as the outline in [64] ‑ [72] above demonstrates, he held that it cannot.
It should not be necessary to say more, but, because counsel for Mr Thompson submitted to the contrary notwithstanding the very clear reasons of the primary judge, we will elaborate.
The judge identified, as one of the critical issues for his decision, the question of whether the reasons upon which an application is based must exist when the application is made.[123] That issue squarely arose from the parties' competing submissions. In [68] of the reasons, the judge set out his conclusion on that issue in the following terms:[124]
In my view when an application for exemption is made under s 102(3) the reason or reasons justifying the exemption must be constituted by reasons that exist in the expenditure year to which the application relates and thus they must exist at the time the application is made. When an application for exemption for future years is made in respect of a mining lease, the material facts, which constitute a reason, will include an expectation that circumstances will exist in the years to which the application relates that justify the exemption. (emphasis added)
[123] Primary reasons [2](b).
[124] Primary reasons [68].
It is plain beyond argument from this passage that the judge came to precisely the conclusion that ground 1(a) contends is the correct construction and that the judge did not err in the manner alleged by that ground. That is reinforced by [69] of the primary reasons. There, the judge set out, in nine subparagraphs, detailed reasons for the conclusion he had stated in the preceding paragraph. Those reasons are summarised in [66] ‑ [72] above. Had the judge adopted the view attributed to him by ground 1(a), the judge would have been wrong for the reasons given by his Honour in [69] of the primary reasons. To read the reasons as concluding other than as is set out in unmistakeably clear terms in [68], for the detailed reasons given by his Honour in [69], would be nonsensical. The reasons cannot, even faintly arguably, be read in the manner on which ground 1(a) is premised.
When the court pointed counsel for Mr Thompson to the relevant paragraphs of the judge's reasons, and to the obvious effect of those paragraphs, counsel nevertheless persisted in submitting that the judge held that work done and money spent subsequent to the relevant expenditure year could be an 'other reason' for exemption under s 102(3).[125] Indeed, counsel said that he relied on those very paragraphs in persisting with ground 1(a).[126] However, while acknowledging the presence of [68] and [69] of the primary reasons, counsel did not address their content. Rather, he asserted that there is a tension in the judge's reasons arising from, on the one hand, the judge's statement that work done and money spent subsequent to the expenditure year could not be a reason for exemption and, on the other hand, the judge's conclusion that work done and money spent subsequent to the expenditure year was a mandatory consideration under s 102(4).[127] How and why any tension arose was not explained beyond the bare assertion that a tension exists.
[125] Appeal ts 5 - 9.
[126] Appeal ts 7.
[127] Appeal ts 5, 8.
There is no tension in considering work done and money spent after the relevant expenditure year when deciding whether to grant an exemption from expenditure for a reason which arose during the expenditure year, as the judge's reasons themselves demonstrate. For example, the judge said:[128]
[T]he requirement that the facts which constitute the reason for exemption exist at the time of the application - that is, in the expenditure year to which the application relates - confines the evidence that can be relied upon in support of an application under s 102(3). This is not to say that evidence of events that take place after the expenditure year are irrelevant. They may be relevant if they have some bearing on the facts relied to establish the reason, as in the example given by the warden at [85] of his Honour's reasons.
[128] Primary reasons [91].
The construction adopted by the primary judge is, with respect, completely coherent. On the judge's construction:[129]
(1)under s 102(3), any reason for an exemption must be constituted by matters that exist in the relevant expenditure year;
(2)if no such reason is established, no exemption may be granted; and
(3)so long as one or more such reasons are demonstrated, in exercising the discretion whether to grant an exemption, s 102(4) requires that regard be had to work done and money spent on the mining tenement by the holder, including subsequent to the expenditure year.
[129] See primary reasons [68], [69], [72].
Further, the judge referred to an example given by the warden ‑ with whose construction of the Act the appellant's submissions are largely aligned ‑ of how events that occur after the expenditure year may bear on a reason for exemption which arose during the expenditure year.[130] The warden's example, summarised at [46] above, postulated a case where the development of a tenement after the relevant expenditure year demonstrates that time was required during the expenditure year to plan for future exploration or mining or to raise capital therefor.
[130] Primary reasons [91] referring to warden's reasons [85].
For these reasons ground 1(a) is entirely without merit.

Ground 1(b): appellant's submissions

Ground 1(b) is a complaint as to the judge's finding that work done and money spent on a mining tenement subsequent to the expenditure year is a mandatory consideration when determining an application for an exemption.
As context for the construction exercise, Mr Thompson submits that 'as a matter of course' an objection to an exemption application will be accompanied by an application for forfeiture and that, therefore, it can and should be assumed that an objector is also an applicant for forfeiture.[131] Further, he notes, when an application for forfeiture is made, there is a pro rata reduction in the amount of the annual expenditure obligation while the forfeiture application is pending.[132]
[131] Appellant's submissions [12] ‑ [15]; appeal ts 12.
[132] The Regulations, reg 52; appellant's submissions [17].
Mr Thompson submits that, properly construed, 'work done and money spent on the mining tenement' in s 102(4) means work done and money spent in and before the expenditure year the subject of the exemption application.[133]
[133] Appellant's submissions [23]; appeal ts 9 - 10.
Mr Thompson says that this construction follows as a 'logical and practical necessity' from the fact that an application for exemption must be made during or within 60 days after the expenditure year to which the application relates. That fact is, he submits, an indicator that consideration of these matters must stop by the end of the expenditure year.[134]
[134] Appellant's submissions [24].
Mr Thompson further submits that:[135]
(1)the first limb of s 102(4) ‑ 'the current grounds upon which exemptions have been granted' ‑ necessarily directs attention to matters in the past; and
(2)reading s 102(4) as a single sentence, the second limb ‑ 'the work done and the money spent on the mining tenement by the holder thereof' ‑ should be read in the same manner, as directing attention only to matters extant at the time of the application.
[135] Appeal ts 9 - 10.
Mr Thompson submits that this construction is also supported by s 102(2). He points out that historical work and expenditure would be directly relevant to the 'further time' ground in s 102(2)(b) and s 102(2)(c), the uneconomic ground in s 102(2)(e) and the 'future operations' ground in s 102(2)(f),[136] submitting that this is supported by what was said by Steytler P in Haoma Mining NL v Tunza Holdings Pty Ltd.[137]
[136] Appellant's submissions [25].
[137] Haoma Mining NL v Tunza Holdings Pty Ltd [60] - [66].
Mr Thompson contends that future work and expenditure is addressed by the Act in: (i) providing that a mining lease holder is relieved from future expenditure and work obligations for so long as a forfeiture application is on foot;[138] and (ii) permitting future work and expenditure to be considered in the context of a forfeiture application, rather than in an exemption application.[139] He submits that s 102(4) should not be construed so as to remove the incentive for objections to an exemption application, as to do so would undermine an object of the Act as summarised in [17] above.[140]

Ground 1(b): disposition

[138] Appellant's submissions [30].

[139] Appeal ts 13 - 14.

[140] Appeal ts 14, 19.

As always, the starting point for the construction exercise is the text. For convenience, we set out s 102(4) again, which provides as follows:
When consideration is given to an application for exemption regard shall be had to the current grounds upon which exemptions have been granted and to the work done and the money spent on the mining tenement by the holder thereof.
The opening words of s 102(4) stipulate the scope and time of its application, namely, 'when consideration is given to an application for exemption'. There being no indication to the contrary, the natural sense of the language of the provision is that the stipulated matters are to be evaluated as at that time. As the judge observed,[141] the combination of those opening words with the use of the past tense in the phrase 'work done and the money spent on the mining tenement' favours the broader construction adopted by the judge ‑ that work done and money spent up to the time when consideration is given to the application is required by s 102(4) to be taken into account.
[141] Primary reasons [74]; see [75] above.
We do not accept Mr Thompson's submission summarised at [111] above. The language and subject-matter of the first limb of the subsection inherently directs attention to matters prior to the expenditure year. The second limb has a different subject-matter and is expressed in different language. The limitation inherent in the subject‑matter and language of the first limb is not inherent in the subject‑matter and language of the second limb. Thus the fact that the subject‑matter and language of the first limb inherently directs attention to matters prior to the expenditure year does not justify reading the second limb, expressed in different language and with a different subject‑matter, so as to impose a similar limitation. In that context, we say 'similar' rather than 'the same' because the limitation applicable to the first limb ‑ that it must relate to matters prior to the expenditure year ‑ cannot be directly transposed to the second limb. That is because, as counsel for Mr Thompson properly concedes,[142] work done and money spent in the expenditure year itself is plainly within the ambit of s 102(4).
[142] Appeal ts 10, 15.
For these reasons, in our view, the text of s 102(4) favours the broader construction adopted by the primary judge.
In our opinion, nothing in the statutory context or the evident purpose of s 102, or the Act as a whole, justifies the adoption of the narrower construction advanced by Mr Thompson. In this regard, it is important to keep in mind the judge's conclusion that work and expenditure subsequent to the expenditure year cannot be the reason for the exemption ‑ the reason or reasons must be found in matters existing during the expenditure year. If and only if such reasons are established, in exercising the discretionary power to grant an exemption, the Minister must take account of all expenditure and work up to the date of consideration of the application.[143] Once this is recognised, the force of many of Mr Thompson's submissions is removed, because they were addressed to why subsequent expenditure should not be permitted to constitute an 'other reason' under s 102(3).[144] Thus, for example, contrary to Mr Thompson's submissions, the judge's construction does not permit a tenement holder to 'spend their way to a certificate of exemption'[145] ‑ an applicant for an exemption must demonstrate a reason for the exemption consisting of matters that existed during the expenditure year. As the primary judge rightly recognised, the policy of industry self‑regulation counts against permitting subsequent expenditure to amount to an 'other reason' under s 102(3), but does not weigh, to any significant degree, against construing s 102(4) as requiring regard to subsequent expenditure.[146]
[143] Primary reasons [72].
[144] For example, appellant's submissions [27] ‑ [29].
[145] Appellant's submissions [28]; see also appeal ts 14.
[146] Primary reasons [69](e), [75](c).
There is no evident reason for excluding as relevant considerations work done and money spent on the tenement after the relevant expenditure year, but prior to the time an application for exemption is considered. It is not difficult to contemplate circumstances in which subsequent work and expenditure (or the absence thereof) might be considered to be relevant to the exercise of the Minister's broad discretion under s 102(3).[147]
[147] As to the breadth of the Minister's discretion, see Haoma Mining NL v Tunza Holdings Pty Ltd [76].
In our opinion:
(1)the natural meaning of s 102(4) accords with the judge's construction;
(2)nothing in the context or evident purpose of s 102 or of the Act as a whole justifies reading into s 102(4) the temporal limit advanced by Mr Thompson's narrow construction; and
(3)nothing in Mr Thompson's other submissions, summarised at [109] ‑ [113] above, sustains the construction advanced by Mr Thompson.
For these reasons, ground 1(b) fails.

Ground 2: 'any other reason' in s 102(3)

The appellant's submissions

Mr Thompson's submissions emphasise the word 'other' in the phrase 'any other reason' in s 102(3). He submits that the word 'other' is a reference to, and thereby an exclusion of, the list in s 102(2). He submits that the ordinary meaning of 'other' includes '1 additional or further; 2 different or distinct from the one or ones mentioned or implied …; 6 unlike most of the same type; unusual'.[148]
[148] Appellant's submissions [32] ‑ [36].
Therefore, Mr Thompson submits, properly construed, the text of s 102(3) provides that a reason for exemption under that provision must be of a different character to those set out in s 102(2).[149]
[149] Appellant's submissions [37].
In oral submissions, counsel for Mr Thompson sought, unsuccessfully, to retreat from this construction. There is no room to do so. It is the construction advanced by ground 2. Moreover, it is also the construction adopted by the warden, and found by the primary judge to be erroneous. Unless the warden's construction is the correct one, the judge was right to find the warden's construction to be erroneous and to grant relief on that basis. Thus, Mr Thompson can succeed on ground 2 only if he sustains the construction set out in [123] above. His counsel ultimately accepted that this was so.[150]
[150] Appeal ts 27 - 28.
Mr Thompson submits that his construction is consistent with considerations of context and purpose. The expenditure conditions imposed on mining tenement holders are intended to be reasonably stringent in order to promote the primary object of the Act.[151] The legislature having specified reasons for which a tenement holder may be exempted under s 102(2)(a) ‑ (h), the 'any other reason' ground in s 102(3) should be seen as a recognition that the legislature cannot be expected to foresee and specify every meritorious reason for which a tenement holder ought to be exempted from the minimum expenditure. That discretion should be constrained to preserve the reasonably stringent nature of the expenditure conditions, in order to promote and encourage mining.[152]
[151] Appellant's submissions [39], referring to Nova Resources NL v French (57, 58).
[152] Appellant's submissions [40] - [42].

Mr Thompson further submits, in support of his construction, that s 102(3) should not be construed to permit an applicant who seeks to rely on a matter as falling within a particular paragraph of s 102(2), but fails to make that out, to rely on the same matter as an 'other reason' within s 102(3).[153]

Disposition

[153] Appeal ts 22 - 23, 24.

We do not accept that, on a proper construction of s 102(3), a reason for exemption under that provision must be of a different character to the reasons set out in s 102(2). The only textual feature of s 102(3) relied on by Mr Thompson is the word 'other' in the phrase 'any other reason'. The reference to an 'other reason' falls well short of sustaining his construction. A reason will be an 'other reason' if it does not satisfy the criteria of one or more of the reasons specified in s 102(2). Nothing more is required in order to be an 'other reason'.
Mr Thompson's construction imposes an additional step: in order that a reason fall within the ambit of s 102(3), it must be of a different 'character' to those in s 102(2). Nothing in the notion of 'other' supports or requires that additional step in the application of s 102(3). In seeking to impose it, Mr Thompson's (and the warden's) construction places a gloss on the statutory language that is not justified by the text, context or purpose of the provision or the Act as a whole.
Moreover, on Mr Thompson's construction, consideration of whether s 102(3) applies requires a process of characterisation of the reason(s) advanced and an evaluation of whether they are of a different character to the reasons in s 102(2). The process of characterisation of a reason advanced and of each reason in s 102 is itself far from clear: how is the 'character' of a reason to be discerned, and at what level of generality? Counsel for Mr Thompson was unable to shed any light on these questions.[154] Nor, insofar as the contended for construction calls for evaluation of difference, did counsel explain what degree of difference was necessitated by the suggested construction. The indeterminacy of the process of characterisation and evaluation, and its disconnect with s 102, counts against Mr Thompson's construction.
[154] Appeal ts 23 - 24.
The interposition, in s 102(3), of a requirement that a reason be of a different character to those in s 102(2) is not consistent with the breadth of the discretion conferred on the Minister by s 102(3).[155]
[155] As to the breadth of the discretion, see Haoma Mining NL v Tunza Holdings Pty Ltd [76].
We do not accept Mr Thompson's submissions summarised at [126] above. It is open to an applicant for exemption to rely upon a matter on the basis that it falls within s 102(2) and, if it does not, to also rely upon that matter on the basis it constitutes a sufficient other reason within s 102(3). That is not to say that such an argument will succeed, only that it is not impermissible at law. As the primary judge observed, it may well be, in practical terms, that if a tenement holder is unable to establish one of the reasons specified in s 102(2), reliance on the same facts for the purpose of s 102(3), without more, will not be sufficient to persuade the warden to recommend the grant of an exemption. However, those facts, taken with additional facts, might be found to constitute an 'other reason' that in the opinion of the Minister justifies an exemption.[156]
[156] Primary reasons [86].
For these reasons, ground 2 fails.

Conclusion

For the above reasons, the appeal should be dismissed.
The parties should be heard on the costs of the appeal.

I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
RC
Associate to the Honourable Justice Beech
2 JULY 2021