Watson v State of Western Australia (No 3)
[2014] FCA 127
•24 February 2014
FEDERAL COURT OF AUSTRALIA
Watson v State of Western Australia (No 3) [2014] FCA 127
Citation: Watson v State of Western Australia (No 3) [2014] FCA 127 Parties: JOHN WATSON AND OTHERS ON BEHALF OF THE NYIKINA MANGALA PEOPLE v STATE OF WESTERN AUSTRALIA AND OTHERS File number: WAD 6099 of 1998 Judge: GILMOUR J Date of judgment: 24 February 2014 Catchwords: NATIVE TITLE – application to limit participation in proceedings.
COSTS – exercise of discretion under s 85A of the Native Title Act 1993 (Cth) – whether or not there was unreasonable conduct – indemnity costs – costs paid forthwith.
Legislation: Federal Court of Australia Act 1976 (Cth) s 43
Native Title Act 1993 (Cth), ss 84(5), (8), 225(c), (d)Cases cited: Aon Risk Services Australia Limited v Australian National University (2009) 239 CLR 175
Australian Agricultural Co Ltd v AMP Life Ltd [2003] FCA 1134
Backreef Oil Pty Ltd and Oil Basins Ltd/JW (name withheld) and Ors on behalf of Nyikina and Mangala/Western Australia [2013] NNTT 9
Cheedy v Western Australia (No 2) (2011) 199 FCR 23
Colgate-Palmolive Company v Cussons Pty Limited (1993) 46 FCR 225
Complete Technology Integrations Pty Ltd v Green Energy Management Solutions Pty Ltd [2011] FCA 1319
Fiduciary Ltd v Morningstar Research Pty Ltd (2002) 55 NSWLR 1
Hamod v New South Wales (2002) 188 ALR 659
Members of the Yorta Yorta Aboriginal Community v State of Victoria (2002) 214 CLR 422
Munn (for and on behalf of the Gunggari People) v Queensland (2001) 115 FCR 109
Ruddock v Vardarlis (No 2) (2001) 115 FCR 229
Watson v State of Western Australia [2013] FCA 238Date of hearing: 15 & 22 May 2013, 18 July 2013, 13 August 2013 Place: Perth Division: GENERAL DIVISION Category: Catchwords Number of paragraphs: 110 Counsel for the Applicant: Mr V Hughston SC, Ms T Jowett and Ms J Cole Solicitor for the Applicant: Kimberley Land Council Counsel for Oil Basins Ltd: Mr P van Hattem SC, Mr M Bruce and Ms S Brown Solicitor for Oil Basins Ltd: Bennett & Co Counsel for the State of Western Australia: Ms S Begg and Ms C Taggart Solicitor for the State of Western Australia:
Counsel for the Commonwealth:
Solicitor for the Commonwealth:
State Solicitor's Office
Ms A Ladhams
Australian Government Solicitor
IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION
WAD 6099 of 1998
BETWEEN: JOHN WATSON AND OTHERS ON BEHALF OF THE NYIKINA MANGALA PEOPLE
ApplicantAND: STATE OF WESTERN AUSTRALIA AND OTHERS
Respondent
JUDGE:
GILMOUR J
DATE OF ORDER:
24 FEBRUARY 2014
WHERE MADE:
PERTH
THE COURT ORDERS THAT:
1.Oil Basins Limited’s (OBL) participation in the proceeding be limited to leading evidence and making submissions in respect of the matters listed in the Native Title Act 1993 (Cth) s 225(c) and (d).
2.OBL pay the applicant’s costs of the interlocutory application dated 6 May 2013 including, for the period since 19 March 2013, any costs thrown away by reason of OBL changing its position on the issue of connection.
3.The costs, the subject of Order 2, be paid on an indemnity basis forthwith.
Note:Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION
WAD 6099 of 1998
BETWEEN: JOHN WATSON AND OTHERS ON BEHALF OF THE NYIKINA MANGALA PEOPLE
ApplicantAND: STATE OF WESTERN AUSTRALIA AND OTHERS
Respondent
JUDGE:
GILMOUR J
DATE:
24 FEBRUARY 2014
PLACE:
PERTH
REASONS FOR JUDGMENT
By interlocutory application dated 6 May 2013 (removal application), the applicant applied for an order that:
(i)Oil Basins Ltd (OBL) cease to be a party to the proceedings under s 84(8) of the Native Title Act 1993 (Cth) (the NTA).
For reasons which will become apparent, the applicant is now seeking orders that:
(i)OBL pay the applicant’s costs of the removal application on an indemnity basis or, in the alternative, on a party/party basis, such costs to include costs thrown away by reason of OBL changing its position on the issue of connection; and
(ii)OBL’s participation in the proceeding be limited to leading evidence and making submissions in respect of the matters listed in s 225(c) and (d) of the NTA.
Over the course of a number of hearings OBL filed a Further Amended Notice of Intention to Participate and an Amended Substituted Response to the applicant’s Statement of Issues, Facts and Contentions (SIFC), which, in effect, confines its involvement to the matters listed in s 225(c) and (d) of the NTA. It was conceded by senior counsel for OBL that the question is whether this should be formalised as an order. Accordingly, the principal question which then arises is whether or not OBL should pay the costs of the applicant, and if so, on an indemnity basis.
The applicant relies on the affidavits of:
(i)Jacki Lynn Cole sworn 6, 14 and 31 May 2013.
OBL relies on the affidavits of:
(i)Sandra Lynette Brown affirmed 13 and 21 May 2013; and
(ii)Kim Warren McGrath sworn 7 June and 29 July 2013.
Background
In native title proceedings in Western Australia, a practice has developed under which the State (the first respondent in these proceedings) will assess the applicant’s connection evidence with a view to determining whether or not the evidence is sufficient for the State to enter into negotiations on the terms of an appropriate consent determination of native title. The courts have held that in carrying out that assessment, a State party is acting in the capacity of parens patriae to look after the interests of the community generally: see Munn (for and on behalf of the Gunggari People) v Queensland (2001) 115 FCR 109 at [29]. Before the Court will make a determination on native title by consent, it must be satisfied that the State party has in fact taken “a real interest” in the proceeding in the interests of the community generally: Munn at [29].
Ms Cole, in her affidavit sworn 6 May 2013, deposes that in February 2006, the then Principal Legal Officer of the Kimberley Land Council (KLC), acting as the solicitor for the applicant in the present claim, briefed Dr Kingsley Palmer, a senior consultant anthropologist, to undertake research. Dr Palmer was initially asked to commence reading the relevant literature concerning the claim region prior to undertaking fieldwork. In March 2007, Dr Palmer was asked to undertake further fieldwork with the Nyikina Mangala claimants and to write an expert report on his findings relevant to the claim. A draft of that report was completed and was provided to the KLC’s Principal Legal Officer in December 2007 (the Draft Report). The Draft Report was then provided to the State as part of ongoing negotiations with the State over a possible consent determination.
Ms Cole goes on to depose that as part of the process of assessing the connection evidence in the claim, the State engaged a consultant anthropologist, Dr David Martin, to comment on the Draft Report (the Martin Report). After those comments were received, a conference between Dr Palmer and Dr Martin was held on 12 June 2009 in Canberra to discuss issues of agreement and disagreement between them. The meeting was convened and facilitated by Ms Sarah Charbonneau of the State’s Office of Native Title. In and about February 2012, Dr Palmer undertook further fieldwork with the native title claimants and undertook to revise the Draft Report to include additional comments and analysis. The final report of Dr Palmer was served by the applicant in early December (the Final Report).
On 28 September 2007, OBL and Backreef Oil Pty Ltd (Backreef) jointly applied for petroleum exploration permit 5/07-8 EP (the Permit).
On 11 December 2007, the Department of Industry and Resources notified Backreef that the application by Backreef and OBL for the Permit had been successful, and that they were regarded as the preferred applicant.
On 30 January 2008, the State of Western Australia gave notice under s 29 of the NTA of a future act, namely the grant of the Permit to OBL and Backreef. At the conclusion of the s 29 notice period, the Nyikina Mangala native title claim overlapped the proposed Permit area by 67.23% (the Overlap Area): Backreef Oil Pty Ltd and Oil Basins Ltd/JW (name withheld) and Ors on behalf of Nyikina and Mangala/Western Australia [2013] NNTT 9 at [1], [3], [4] (Future Act Decision).
OBL and Backreef engaged in negotiations with the applicant under the NTA’s right to negotiate procedure from early 2008 until May 2012. These negotiations did not result in an agreement.
On 29 May 2012, OBL and Backreef lodged a future act determination application with the National Native Title Tribunal (the NNTT), pursuant to s 35 of the NTA, for a determination that the Permit could be granted (Future Act Proceedings). On 1 February 2013, Member Shurven delivered her decision, which found that the Permit could be granted subject to conditions: Future Act Decision.
At a case management conference held on 4 October 2012, Barker J ordered that:
(i)the matter be referred to mediation by a Deputy District Registrar; and
(ii)the hearing of the proceeding would commence on country on 2 July 2013.
On 25 October 2012, OBL applied to be joined as a respondent party to the current proceedings. While the applicant opposed the application, its counsel advised the Court that it would consent to OBL being joined as a party if the joinder was for the limited purpose of engaging in issues in relation to the extinguishment of native title and, in particular, the effect that the Permit would have on the claim group’s rights and interests in terms of s 225 of the NTA.
In November 2012, the applicant filed the Final Report. I am informed that a copy of the Final Report was provided to Hunt & Humphry, OBL’s then solicitors, on 6 December 2012 in connection with the Future Act Proceedings.
On 15 February 2013, orders were made joining OBL as a respondent party in the proceeding on the basis that its interests may be affected by a determination in the proceedings: s 84(5) of the NTA; Watson v State of Western Australia [2013] FCA 238 (the Reasons) at [9], [11]. Although the trial of the substantive application was due to commence on 2 July 2013, counsel for OBL submitted that, in her experience, which was not inconsiderable, parties such as OBL “take very little part in the proceeding and that such part as they play, does not significantly add to the length or cost of a trial”.
Following case management, on 15 March 2013 the Court made programming orders (the Orders) including that:
LISTING
1. The hearing of the application John Watson & Others (Proceeding) will commence:
(a) on country at locations to be advised for the evidence of Aboriginal witnesses from 2 July 2013 until 15 July 2013; and thereafter
(b) in Perth or at other locations to be advised for the evidence of any other lay witness (except in relation to extinguishment) on dates to be fixed in October 2013;
(c) in Perth for the evidence from expert witnesses (except in relation to extinguishment) on dates to be fixed in October 2013; and
(d) in Perth for the hearing of all other evidence on dates to be set in December 2013.
PARTICIPATION IN PROCEEDINGS
2. Any respondent, other than the State of Western Australia ("First Respondent"), who intends to participate in all or any part of that part of the hearing which is referred to in Order 1, or who wishes to receive any documents regarding that part of the hearing is to file a notice indicating their intention by 20 March 2013.
3. Any party, other than the Applicant and First Respondent, who does not file a notice in accordance with order 2 is excused from complying with these orders.
PLEADINGS
4. On or before 20 March 2013, the Applicant is to file a statement setting out the issues, facts and contentions upon which it proposes to rely in support of the application.
5. On or before 22 April 2013, the First Respondent is to file a statement setting out:
(a) their response to the Applicant’s statement of issues, facts and contentions, including whether any of the facts and contentions in the Applicant’s statements are admitted.
(b) any additional issues, facts and contentions in respect of any other matter.
6.On or before 30 April 2013, any respondent (other than the First Respondent) who proposes to participate in any hearing in respect of the Proceeding who has complied with order 2 above, is to file a statement setting out:
(a) to the extent they wish to participate in any hearing in respect of the Proceeding, their response to the Applicant’s and the First Respondent’s statements of issues, facts and contentions, including whether any of the relevant facts and contentions in the Applicant’s and the First Respondent’s statements are admitted; and
(b) any additional issues, facts and contentions in respect of any other matter.
EXPERT REPORTS AND OBJECTIONS
7. By 7 December 2012, the Applicant is to file any final reports of expert anthropological witnesses upon which the Applicant intends to rely in the proceeding.
8. On or before 30 April 2013, the respondent parties are each to file any anthropological report upon which they intend to rely in the Proceeding.
. . .
The State Solicitor’s Office (SSO), on 15 March 2013, wrote to Hunt & Humphry advising them that the State did not rely on the Martin Report and did not intend to provide it to any respondent party.
Hunt & Humphry then wrote to the KLC by letter dated 18 March 2013 referring to the 5 March 2013 mediation meeting and raising a number of issues including the matter of whether the Nyikina Mangala were a single society at sovereignty.
The KLC responded to Hunt & Humphry’s letter in detail by letter dated 21 March 2013, including a substantive treatment of the concerns over the “single society” issue with reference both to case law and to paragraphs [148]-[172] of the Final Report where, at length, Dr Palmer addressed this issue by having regard to the test laid down by the High Court in Members of the Yorta Yorta Aboriginal Community v State of Victoria (2002) 214 CLR 422. The KLC letter pointed out that the issue had been discussed at length with the SSO and had been discussed between Dr Palmer and Dr Martin, who had met informally, and that as a result the State had been satisfied that connection was capable of being established on the available evidence.
On 19 March 2013, pursuant to Order 2 of the Orders, OBL filed a notice of its intention to participate (the Notice) in all of the hearings referred to in Order 1. The Commonwealth, Telstra, Clover Cattle Co Pty Ltd and Quixot Pty Ltd also filed notices of intention to participate.
I am informed that further mediation occurred on 5 April 2013 and that a “non-unanimous request” was made that a mediation report be provided to the Court by Deputy District Registrar Gilich. A report was ultimately provided on 19 April 2013. In that report the Registrar noted that, if all other parties agreed, the State was prepared to resolve the matter by way of consent determination of native title. It was noted in the mediation report that the Commonwealth and Telstra were willing to be guided by the State in relation to matters concerning connection and were willing to agree that the proceeding be resolved by way of consent determination. The pastoral companies, Clover Cattle Co Pty Ltd and Quixot Pty Ltd, were also willing to be guided by the State in relation to matters concerning connection and were willing to agree that the proceeding be resolved by way of consent determination as proposed by the State. It was also later confirmed by the solicitors for the pastoralists, that they would not be participating in the connection hearing.
On 30 April 2013, OBL, pursuant to Order 6, filed a response to the applicant’s SIFC (the Response). It was the only respondent party to do so. The Response put the applicant to proof on all of the elements necessary to establish native title. In particular, OBL put the following matters in issue: firstly, that the Nyikina People and the Mangala People are one society for the purposes of a determination of native title; secondly, “[t]he reasonableness or accuracy of the northern boundary” of the claim area; thirdly, that the native title rights and interests were exercised within the Overlap Area; and finally, the identity of the members of the native title claim group who exercise native title rights and interests within the Overlap Area. The few admissions which OBL made in respect of the facts and contentions set out in the applicant’s SIFC, were of little, if any, consequence. OBL further indicated in its Response that it needed “guidance and, if possible, certainty as to the existence and identity of groups or individuals with whom it ought to consult in order to ensure OBL’s compliance with the Aboriginal Heritage Act 1972 (WA)”.
On 30 April 2013, the applicant filed a Witness Proposal pursuant to Order 22 of the Orders. The Witness Proposal listed 18 Nyikina Mangala witnesses, which the applicant intended to call to give evidence on-country commencing 2 July 2013, if connection were contested. In her affidavit sworn 6 May 2013, Ms Cole deposes that the 18 witnesses were being proofed and detailed witness statements prepared.
On 6 May 2013, the applicant filed its removal application.
On 8 May 2013, the applicant wrote to OBL’s legal representatives stating that, as an alternative, if OBL would agree to an order that “[OBL’s] participation in the proceeding be limited to the matters listed in s 225(c) and (d) of the [NTA]” the applicant would not press for an order that OBL be removed as a party.
On 10 May 2013, OBL’s legal representatives wrote to the KLC regarding the substantive hearing, stating that the parties should confer as soon as possible and that “[w]e are unable to suggest how the currently proposed hearing of connection evidence may be reduced since we have only the suggested timetable filed 30 April 2013. We can indicate generally however that our client’s position is that only those matters identified in OBL’s Statement of Issues Facts and Contentions filed 30 April 2013 … are in issue”.
Removal application hearings
15 May 2013
On 15 May 2013, when the removal application first came on for hearing, counsel for the State confirmed that it did not challenge the connection material, accepted that there is connection, and that this decision had been made on the merits of the evidence and not for any other purpose. That this decision was made based on the merits of the evidence was, according to counsel for OBL, something which it had not known previously although he on behalf of OBL had raised this in correspondence with the State but without response. He then stated that this explanation by the State, “puts me in a difficult position because of other information that I’m not at liberty to disclose to the Court”.
I will return to this apparent difficulty faced by counsel for OBL later in these reasons. Counsel for OBL informed the Court that this was the first time that OBL had been made aware of the State’s position. Of course, OBL well knew by this date that the State was not putting connection in issue. OBL knew as at 18 February 2013, from the SSO email of 30 January 2013, that the State was considering entering into a consent determination. I will refer to this email in more detail below. OBL had also been advised by its then solicitors, in emails of 1 and 7 March 2013, that the State had been advised by the Solicitor-General for the State of Western Australia that the applicant’s claim would very likely succeed were it to go to trial and that the State had decided to consent to a determination of native title. Those emails also revealed that the State was seeking to negotiate a consent determination with all the parties. I also refer to these emails in detail below. Indeed, at the mediation held on 8 February 2013, as the 1 March email stated, the State had tabled a preliminary outline of a consent determination. The mediation report to the Court from Deputy District Registrar Gilich dated 19 April 2013 confirmed that the State wished to resolve the matter by way of a consent determination. Accordingly, OBL had known the State’s position incrementally since 18 February 2013 and, as a fact, by no later than 7 March 2013 and probably earlier.
Counsel for the State brought to the Court’s attention that position papers are no longer provided to respondent parties as they once were under the previous government.
During the course of the hearing counsel for OBL was asked on several occasions as to what basis connection was being put in issue. The following exchanges occurred:
HIS HONOUR: … Now, if you don’t want to put information before the court for whatever reason, that’s a matter for you, but I should say without foreshadowing or pre-empting my final decision, on its face, I must tell you that I find it difficult to see what else your client needs given the content of the draft consent determination. Your client’s interest in the permit, if it gets the permit, is entirely protected. What more does your client want?
MR BRUCE: Our client wishes to engage fully, your Honour, in both mediation and to the extent that - - -
HIS HONOUR: That’s not an answer to my question, Mr Bruce.
MR BRUCE: Your Honour, it is that we have – we wish to access the evidence that is presented, and we have been assessing the evidence, and we - - -
…
HIS HONOUR: - - - what is it that your client is seeking to achieve beyond what, on its face, would be first prize for someone in your client’s position, namely, that its interests under the permit, to the extent that they conflict with interests and native title interests, your clients rights will predominate. Your client is fully protected. So I’m prepared to accept that there might be something that I don’t know, and that I can’t foreshadow that your client has an interest beyond that. But I must tell you again, for the moment, it escapes me.MR BRUCE: It is, your Honour, that on the material that we have seen, that we are not satisfied at the moment that connection can be made out in respect of the northern part of the claim area. That is 13 per cent of the total claim area, and we wish to, firstly - - -
HIS HONOUR: Now, what’s your basis for that?
MR BRUCE: That principally on the material, on the anthropological report that has been filed, 7 December last year, that there is - - -
HIS HONOUR: Dr Martin?
MR BRUCE: No, it’s Dr Palmer’s report. Dr Martin – Dr Palmer refers to Dr Martin, but Dr Martin’s materials are not before the court.
HIS HONOUR: But that’s the material that the State has had before it, and has fully considered. That’s why I asked Ms Begg the question that I did.
MR BRUCE: Yes. Well, we haven’t been able to, your Honour, in an open forum, refer to that documentation.
HIS HONOUR: So does your client have its own anthropologist?
MR BRUCE: No, your Honour.
HIS HONOUR: So on what basis are you standing alone against everyone else in this claim to suggest that there is no connection
MR BRUCE: We wouldn’t necessarily like to be, your Honour. We are as – we are the only party who filed a statement of facts and contentions on 30 April, and as at that date, we were engaging in mediation, and so - - -
HIS HONOUR: But do you have a basis to contest connection, Mr Bruce.
MR BRUCE: Yes, your Honour. Well, we believe on the material that we’ve seen to date that there is a query and potentially a substantial query that we would like to explore in order to satisfy ourselves, first in relation to mediation, and obviously if the matter cannot be resolved through mediation, we are then before the court - - -
…
HIS HONOUR: And you must forgive me if I ask you the same question for a third time, but given the protection that your client so clearly is going to be afforded in relation to its permit, and as I understood your clients’ interest when the matter first came on, on the joinder application, was its interest in the permit; its rights under the respective permit being protected that was shaping your client’s involvement. Given that it would seem an iron-clad protection of your client’s ....., why is your client not satisfied with that?
MR BRUCE: Our client wishes to ensure, your Honour, in part, that it is able to negotiate in the future, not just in relation to native title matters, but Aboriginal protection matters, with the people - - -
HIS HONOUR: But you have that right to negotiate in relation to that. You can’t make demands of applicants to those sorts of matters, which would be the subject of negotiation as a right in due course, as the cost of you not putting in issue connection.
…It may be seen then, that, when asked whether OBL was in possession of any material which supported or gave rise to its concern, it was submitted that it was principally derived from its consideration of the Final Report, and that it did not have its own expert. Counsel for OBL submitted that in assessing the Final Report, they were exploring it in the context of “other documents”. It was later revealed that the “other documents” referred to by counsel were the Martin Report and an earlier report that Dr Palmer had co-written with another anthropologist in relation to the Noonkanbah area (the Noonkanbah Report). Both documents were referred to in the Final Report which OBL had had in its possession since December 2012. In the Final Report Dr Palmer concluded that the evidence supported connection with the Nyikina and Mangala constituting one society (connection). The Martin Report had been prepared for the purposes of mediation and was subject to privilege, and the Noonkanbah Report was produced for mediation purposes and was subject to confidentiality restrictions. However, those two reports, it seems, were inadvertently provided to OBL by the KLC under cover letter of 27 March 2013.
Counsel for OBL conceded that its Response overreached the Permit area and informed the Court that it wished to amend the document. The Court ordered that the proceeding be adjourned to 22 May 2013 to enable this to occur.
On 20 May 2013, OBL filed an Amended Notice of Intention to Participate (Amended Notice) and a Substituted Response to the applicant’s SIFC (Substituted Response). The Amended Notice indicated, amongst other things, that OBL did not intend to participate in any part of the hearing referred to in Order 1(a), (b) and (c) of the Orders. This, properly understood, was a concession by OBL that connection would no longer be an issue. OBL also indicated that it wished to participate in that part of the hearing referred to in Order 1(d) to the extent that such hearing relates to extinguishment issues. In its Substituted Response OBL stated that it was solely concerned with “the area of overlap between the prospective Permit area and the Nyikina Mangala Claim Area (Overlap Area) … and … Extinguishment Issues within that Overlap Area”.
Hearing – 22 May 2013
The removal application came back on for hearing on 22 May 2013. At this hearing the applicant advised the Court that it was pressing for the alternative order that OBL’s participation in the proceeding be limited to matters listed in s 225(c) and (d) of the NTA. The applicant submitted that despite filing the Substituted Response, OBL had not narrowed its response to issues of extinguishment as per s 225(c) and (d). It was submitted by senior counsel for the applicant that the Substituted Response was concerned solely with the Overlap Area and extinguishment issues within the Overlap Area, and that there were only two issues in the proceeding: connection and extinguishment. It was further submitted that this presupposed that there would be other issues which OBL would wish to be involved in in relation to the Overlap Area, and if it was not an extinguishment issue, it would necessarily be a connection issue. OBL was given leave to file and serve a Further Amended Notice of Intention to Participate and Substituted Response to the applicant’s SIFC to clarify the concerns raised by the applicant. An order was also made vacating the Orders.
On 29 May 2013, OBL filed a Further Amended Notice of Intention to Participate (Further Amended Notice) and an Amended Substituted Response (Amended Substituted Response) which provided that OBL’s “Amended Substituted SIFC in response to the Applicant’s SIFC is concerned solely with Extinguishment Issues within the area of overlap between the prospective Permit area and the Nyikina Mangala Claim Area …”.
Hearing – 18 July 2013
The application was again brought back on for hearing on 18 July 2013. It was submitted by OBL that it had opposed entering into a consent determination because during the time in which OBL had been a party to the proceeding it had become aware of information from which it formed the view that the applicant’s case, at least in relation to the Overlap Area, had serious deficiencies. It was submitted by OBL that it had on various occasions requested information from the applicant and the State in relation to its concerns, but that it had not been persuaded by their responses. This included a request to the applicant, on 18 March 2013, for a copy of the Draft Report, the Martin Report and the Noonkanbah Report and to the State, on 20 March 2013, for a copy of the Martin Report. It was submitted by OBL, with reference to the above correspondence, correspondence from the State to OBL’s former solicitors dated 15 March 2013 and the applicant’s response to OBL’s request dated 21 March 2013, that it had been actively attempting to obtain the necessary information which might satisfy it that connection need not be in issue.
Senior counsel for OBL referred to various materials which, it was submitted, had informed OBL’s view and understanding, and that the behaviour of OBL must be assessed in the context of its knowledge. The first document was the affidavit of Jacki Lynn Cole sworn 31 January 2012. Exhibited to this affidavit were the minutes of the first day of a meeting of the Nyikina Mangala native title claim group which was held on 23 and 24 November 2011 at Jarlmadangah well before the Final Report was written. OBL relied particularly upon the following paragraphs:
Vance Hughston (VH): … This claim is a combination of 7 earlier smaller claims from the mid ‘90s. … What was done then was the 7 groups where [sic] bundled into one group without a great deal of thought, so the claim group description is a grouping of those 7.
…VH: Recently the State has said that the Nyikina Mangala claim to be fundamentally flawed and doesn’t accept Dr. Palmer’s advice and that it doesn’t accept that Nyikina Mangala is a single society, that has always been here.
…VH: The State doesn’t accept that we can prove that there was a single society at sovereignty.
…VH: Another reason the State say the current Nyikina Mangala claimis [sic] fundamentally flawed is that it is difficult the determine where the boundaries between Nyikina and Mangala are.
V. Hunter: Where are the anthropologists for the State that argue against that?
VH: They have one anthropologist and his argument, David Martin; he agrees that today you are a single society, but he says that there is not enough evidence to show single society at sovereignty due to lack of documentation.
…VH: …The State has 2 more criticism [sic]:
1. Not enough evidence of the coastal areas; and
2. Not convinced for where the Nyikina are in the south and the Mangala in the north, but Dr. Palmer can deal with that.Jacki Cole (JC): … Dr. Palmer knows and has said that we need more evidence, so the State has said and so we agree. … It may be that when we do the extra work the State agrees with us…
OBL referred to the Future Act Decision which was delivered on 1 February 2013. It was submitted by OBL that, while the evidence provided in that proceeding was not evidence in support of a native title claim, it was evidence relevant to the matters being considered by the NNTT. It was further submitted that the evidence in that proceeding needed to address the impact of the grant of the Permit on the native title claimants in relation to, among other things, the exercise of the native title rights that were claimed. The Court was directed to the following paragraphs in that decision:
Rights to possess occupy and enjoy the area; to access the area
[53] The native title party contends … that the Dadaga Affidavit provides evidence that ‘many Nyikina Mangala people live in the Nyikina Mangala claim area’ and that Aboriginal communities exist at Jarlmadangah and Pandanus Park, which they say are located in or near the proposed permit. However, while Pandanus Park is within the permit area, Jarlmadangah is located approximately 40 kilometres from the southern boundary of the proposed permit. I note Dadaga does not specify the number of, or approximate number of, people from the native title party residing in Pandanus Park. Dadaga also refers … to a community at Mowanjum, which is located within the proposed permit but outside the claim area. I note from mapping provided by parties, that there are several communities within the permit area, but outside the claim area, and also within the claim area, but outside the permit area.
[54] In several places in his affidavit, Dadaga refers incidentally to places used for camping and fishing, but gives no indication of how frequently these places are visited. Several of these places appear to be outside the proposed permit. Dadaga says that he takes young people out on the land to pass on the laws and customs of the native title party and started a program aimed at taking at-risk youths on country to teach them about culture... . However, he does not specify whether the proposed permit area is used for these purposes, and if so, how often.
[55] The native title party also contends that the Palmer Report ‘provides a plethora of evidence of current practices of the exercise of traditional rights on Nyikina Mangala country’. …. In his report, Dr Palmer lists several of the rights to country mentioned by individual members of the native title party in the course of his research, including rights to: access country; burn the country; camp on the country; perform rituals for increase; stage corroborees and teach others about the country. ... However, I note that the specific instances recorded by Dr Palmer took place outside the permit area. Dr Palmer does not provide any indication of the extent to which these rights are exercised or enjoyed within the area of the proposed permit, or the search area. Dr Palmer states that members of the native title party continue to carry on ritual practices, including youth initiation and the use and custodianship of sacred objects by Law men, but does not specify whether any of these practices occur within the permit area. It also appeared that some of these activities were not currently undertaken, but had been undertaken in the past.
…
[59] Mr McGrath states … that he has ‘undertaken field trips’ in the permit area and that he has not ‘observed any activities in the area during … visits other than heritage surveys’. … However, there is no information given on how many field trips or for how long he was in the field. In any event, Mr McGrath states … that the grantee parties are willing to consult with the native title party to mitigate any interference with traditional activities.I accept that members of the native title party continue to use and enjoy areas within the claim, and also therefore within the proposed permit. I do also note and accept the native title party’s submission …, that petroleum exploration involves ‘very different rights’ from pastoral interests. However, in the absence of specific evidence about the extent to which the native title party exercises its rights to use and enjoy the area within the proposed permit, as opposed to the claim area in general, I am unable to conclude that the grant of the proposed permit will have a significant effect on the enjoyment of those rights.
It was submitted by OBL that the evidence which was provided in the Future Act Proceedings, as it was summarised at [53], [54], [55] and [59], did not show a strong native title claim, or even a basis on the balance of probabilities for establishing native title in the Overlap Area.
OBL placed considerable reliance upon an email dated 30 January 2013, which had been sent by the SSO to the respondent parties (the 30 January email). This email was re-sent to OBL on or around 18 February 2013, after it had been joined as a respondent party. The relevant part of this email had previously been redacted and accordingly was not before the Court at the earlier hearings. The 30 January email included the following:
Whilst we do not agree with the conclusion in Dr Palmer’s report that there was one Nyikina Mangala society at the time of sovereignty, given the dearth of early ethnography for either group the State will consider, as a matter of pragmatism, a consent determination in favour of the Nyikina Mangala people, with no reference to one society at sovereignty and no demarcation of Nyikina or Mangala areas.
(Emphasis added.)The use of the phrase “as a matter of pragmatism” was capable of subverting what counsel for the State had informed the Court on 15 May 2013: that the State’s decision to no longer put connection in issue was the product of its consideration of all the relevant evidence and not for any other purpose. I infer that the content of this redacted paragraph, at least, fell within the “other information” referred to by Mr Bruce, of counsel for OBL, when he informed the Court on 15 May 2013, as I have mentioned, that what the State had said formed the basis of its decision to accept connection had put him “in a difficult position”. In other words, I infer, had Mr Bruce been at liberty on that occasion to do so he would have disputed what had been said on this question by the State and would have submitted that the decision by the State had been made for reasons of pragmatism and not based on the available evidence.
Consistently with what Mr Bruce must have understood was the position, it was submitted by senior counsel for OBL that, but for the 30 January email, there would have been no reason for OBL to believe that the State had not satisfied itself as to the cogency and sufficiency of the applicant’s connection evidence. It was further submitted that by 21 March 2013, whilst the State may have satisfied itself that there was sufficient evidence to establish connection, that OBL had not been informed of this. Again, whilst I accept that Mr Bruce and senior counsel did not appreciate it, as a matter of fact, OBL was well aware of the State’s reasons for no longer putting connection in issue. It was then submitted by senior counsel for OBL that “the last word from the State on this was that it was not satisfied about connection issues” and that while the State had the Martin Report it was not allowing the other respondent parties to review it.
However, for reasons I will explain later, as at 1 March 2013 OBL knew, contrary to this submission, that the 30 January email was not the State’s last word on the issue of connection.
The State resisted the tender of various documents, including the 30 January email. The State submitted that this email did not present a complete explanation of the State’s position, and that absent further context, its content was likely to be misunderstood concerning the State’s position as to the connection issue. It also submitted that additional material would throw light on just what information the State had provided to OBL on the connection issue. It was further submitted that the material provided did not set out the substance of discussions which had occurred between the State and OBL. The following exchanges then occurred:
MR VAN HATTEM: But the submission is made, both in writing and this morning, that the material that has been put before your Honour by Oil Basins is incomplete and that the email of 30 January 2013 doesn’t paint the whole picture. Now, we’ve been on notice of that. I have specifically raised that issue with my instructing solicitors and yesterday, I specifically raised that issue with Mr McGrath, vis, was any information provided by the State, was there any evidence dealing with the issue of connection of society in the overlap area subsequent to the material that I’ve already taken your Honour to.
HIS HONOUR: Including without-prejudice discussions with the State?
MR VAN HATTEM: Absolutely. Yes. Was there anything further? Now, it is conceded that there were discussions. It is conceded that representations were made, forcefully, in fact, in the course of those discussions, but it is not conceded that any information in the nature of evidence was provided….
But my instructions are and my very clear understanding from my discussion with Mr McGrath is that nothing was received from the State in the nature of information as distinct from argument, submission [and] representation….The State very strongly represented to Oil Basins that it should concede its position, but in doing so, the State did not provide material in the nature of evidence which would reasonably – well, it simply didn’t provide material in the nature of evidence – full stop….
…
HIS HONOUR: But Mr Van Hattem has told me – and at the moment, it’s no more than a statement from the bar table – that whilst his client was the recipient of representations and submissions, it was not given the benefit of any additional information that you could describe as evidence. …MR HUGHSTON: No, and I accept that, your Honour.
HIS HONOUR: I don’t know what the fact is – you accept that?
MR HUGHSTON: I would accept that, but what’s important is the submissions: the State’s explanation to Oil Basins as to why the State was accepting the connection evidence. They’re the submissions. It’s not additional evidence. That they are giving them, if you like, their legal view as to why they have accepted the connection evidence and why Oil Basins should accept it. You know, additional evidence or information is irrelevant. Mr Van Hattem was very careful to say that there were submissions and that’s the whole point: the State has explained its position. …
…
HIS HONOUR: … Ms Taggart, when were these discussions – when did they occur?MS TAGGART: I believe it may have been in March, your Honour. As to specific dates - - -
HIS HONOUR: Sometime in March, was it?
MS TAGGART: 12 March, your Honour, there was a mediation meeting and there was also – previous to that, there were discussions between the previous legal representatives and representatives for the State as well as representatives for the pastoral parties …
HIS HONOUR: … Mr Van Hattem, why has your client not put on that information?
MR VAN HATTEM: Your Honour, simply because we didn’t consider that it was remotely relevant to this matter.
HIS HONOUR: But can your client do that?
MR VAN HATTEM: Yes, there’s no objection at all to my client putting on a further affidavit saying what its dealings with the State were in the intervening period. The State has already indicated that it would object to that, but in light of what’s happening this morning, perhaps it won’t. But there’s no objection to fully disclosing to the Court for the purposes of these proceedings the discussions between the State and my client.
(Emphasis added.)
The hearing was adjourned to allow OBL to put on a further affidavit or affidavits, deposing to the substance of the conversations which had occurred. The State was granted leave to put on a responsive affidavit.
Hearing – 13 August 2013
The application was again brought on for hearing on 13 August 2013. At this hearing senior counsel for OBL submitted that the additional material, contained in the affidavit of Kim Warren McGrath sworn 29 July 2013, which OBL understood to be the “totality of the material”, was not relevant and that OBL did not rely on it. In fact, this additional material was centrally relevant.
The State referred to an email dated 1 March 2013, from the then solicitors for OBL, Hunt & Humphry, to Mr McGrath. This email details a confidential and without prejudice conversation that Mr Humphry had with Ms Begg, the Senior Assistant State Solicitor. This email sets out in detail why the State, on the evidence available to it and having received advice, had considered that if the applicant’s claim went to a contested hearing it would succeed. Significantly, the email noted that Ms Begg had acknowledged that the 30 January email had not been well worded, and that the reference to “a pragmatic approach” was meant to convey that despite any reservations the State may have had about the “society” issue, it recognised that the claim was likely to succeed. The phrase “a pragmatic approach” employed by Mr Humphry is an obvious synonymous reference to the use by Ms Begg of the phrase “as a matter of pragmatism” which she had utilised in the 30 January email. The “advice” referred to was the expert advice of another anthropologist.
The email from Hunt & Humphry also sets out the following reasons why the State no longer was concerned about the evidence going to connection. This was for two reasons. The first was evidentiary. The second concerned the approach of this Court in such cases:
Initially the State was concerned that Dr Palmer’s report did not adequately address the “society” question and they had their own advice from Dr Martin questioning this aspect of the report. Apparently, Dr Martin was not available more recently and the State consulted another anthropologist who advised that Dr Palmer’s thesis is sustainable albeit somewhat shallow. Apparently a significant difficulty faced by the anthropologists is the apparent lack of early anthropological research in the area which is needed to give a clearer picture of the situation at sovereignty. The KLC is not aware that the State has obtained further anthropological advice.
Ms Begg advised that the State is conscious that in other cases concerning claims by “mixed groups”, the Federal Court has taken a generalist or high level approach to the requirement that a single land owning society has continued since sovereignty. Provided the members of the claim group are traditionally associated with parts of the claim area, the group is united in the claim to the land and they follow similar beliefs, the Federal Court has been prepared to make a determination.
The State referred to another email from Mr Humphry to Mr McGrath, dated 7 March 2013. This summarised a further briefing session held by the SSO with the representatives of the pastoralists and counsel for OBL. It goes into some detail as to the steps taken by the State to confirm the claim boundaries, including that “[b]ased on advice, while the State considers that some aspects of Dr Palmer’s report are not convincing … the State considers that there is a reasonable basis for the claim boundaries and for a single determination notwithstanding historical and traditional differences between Nyikina, Mangala and Warrwa”. Mr Humphry went on to state:
Moreover, there is no evidence available to the State that could be presented in opposition to the claim. Although there is some early linguistic data concerning the Nyikina, Mangala and Warrwa there is no early anthropological material. Accordingly, the State considers (on senior counsel’s advice) that, in spite of any misgivings it may have had concerning Dr Palmer’s report, the claim would succeed in a contested hearing. The State also considers that the evidence contained in Dr Palmer’s report is sufficient to justify the court making a determination under s 87 of the Native Title Act. In the circumstances it has taken the decision to consent to a determination of native title.
The State actively contested early native title claims. However, the general policy now is to agree to consent determinations if the State considers on advice that the claim will succeed rather than put the claims to proof.
(Emphasis added.).The advice of senior counsel referred to was given by Mr Grant Donaldson SC, Solicitor-General for the State of Western Australia.
Counsel for the State submitted that the other expert anthropologist who had been briefed had taken a different view from that of Dr Martin, and that, in any event, the report of Dr Martin was only a preliminary view, and that he had not given full consideration to the issues, which was why the State was reluctant to place any reliance on his report.
OBL submitted that the material to which the State had taken the Court demonstrated that the State had obtained a further anthropologist’s report, which had not been disclosed to OBL; that the State had obtained the advice of senior counsel, the Solicitor-General, which had not been disclosed; and that the instructions upon which the advice was based had not been disclosed. It was put by senior counsel for OBL that there was no basis for knowing whether or not the Solicitor-General had the Martin Report available to him, or whether any criticism of the Final Report had been made known to him. These submissions disclose a fundamental misconception as to the role of and obligations of the State in such matters. The State acts in the capacity of parens patriae to look after the interests of the community generally. Here the State took, as it should have, a real interest in the proceedings in that capacity. It was involved in negotiations and mediation meetings with the applicant over many years. It had carefully analysed and assessed the applicant’s connection material.
It seems that the Martin Report of 2009 comprised a short set of notes on Dr Palmer’s Draft Report of 2007. Dr Martin had disagreed with the conclusions of Dr Palmer on the single society issue. However, following a meeting between the two anthropologists in June 2009 to discuss their disagreements, the issue between them was whether or not there was a single Nyikina Mangala society at sovereignty.
Then in 2011, Dr Palmer was engaged by the KLC to finalise his 2007 Draft Report having regard to the views of Dr Martin. Following 8½ days of field work Dr Palmer produced his Final Report. It comprises 238 pages of report, including bibliography, as well as an Appendix of Genealogical Charts comprising well over 100 pages. It is an impressive report by a leading expert. His opinions are supported by detailed reasons, including reference to, analysis of, and answers to Dr Martin’s opinion on the single society issue. It is little wonder that, in light of this, the State altered its position, on advice from the State Solicitor-General to concede that connection would likely be made out. Importantly, OBL had had this report since December 2012. OBL took no steps to obtain its own anthropological report, whether from Dr Martin or any other expert.
It was submitted by OBL that it did not have to take any steps towards obtaining its own anthropological evidence, as, had the matter gone to trial and Dr Palmer given evidence, the appropriate forensic step for OBL would have been to cross-examine Dr Palmer and persuade the Court that the opinions expressed and the conclusions reached by Dr Palmer were not supported by evidence. It was submitted by OBL that it had acted entirely appropriately in seeking to test the opinion of Dr Palmer. I reject this submission. I do not accept that OBL had a real issue with the matter of connection.
It never raised any such concern with the Court at the time it applied to be joined. Apart from Dr Martin’s notes from years earlier it had no contemporary or detailed anthropological evidence to counter Dr Palmer’s detailed report. It never sought to explain to the Court, despite invitation, what, specifically, it took issue with or why on the issue of connection.
There was no acceptable adequate reason for OBL to have put the whole of the applicant’s connection case in issue in circumstances where all other parties were prepared to enter into a consent determination. The State had assured OBL that it had carefully assessed the whole of the evidence and on proper advice considered that there should be a consent determination. It was also unreasonable in that OBL completely dropped its opposition to connection without providing an adequate explanation. OBL knew, as I have mentioned, by 1 March 2013, that the State had a genuine basis for contending that there should be a consent determination. The submission made to the Court, on behalf of OBL that the 30 January email provided a full picture, and demonstrated how reasonable OBL’s approach had been in deciding to put connection in issue was based on what I find was an incomplete brief provided to senior counsel, omitting, I infer, the emails of 1 and 7 March 2013 from Mr Humphry to OBL. I cannot think that were such emails in his possession that senior counsel could or would have made the “last word” submission.
It is clear from the emails of 1 and 7 March 2013 that the State not only described the reason for its change in position, but gave detailed reasons for this change, which included the advice of senior counsel and the expert advice of another anthropologist. It follows, contrary to OBL’s submission, that by 1 March 2013, or, at the latest by 7 March 2013, OBL was fully apprised of the reasons for the State’s change in position concerning connection. Seen in isolation, the email of the SSO dated 30 January 2013, might have been read so as to suggest that the State’s position was not based on evidence, but rather was driven by pragmatism. As a fact, such a suggestion would have been wrong. In any event, it is clear from the emails of 1 and 7 March 2013 that the State had consented to a determination of native title. Both of those emails were in the possession of OBL although, I infer, not then provided to senior counsel, when the “last word” submission was put by him concerning the 30 January email. Viewed in the context of the two March emails, it was patently not the last word.
Order restricting OBL’s participation
The applicant submits that given the conduct of OBL since it became a party on 15 February 2013, including its unexplained volte face on the issue of connection (volte face) OBL’s participation ought, by order, be limited to leading evidence and making submissions in respect of the matters listed in s 225(c) and (d) of the NTA, relevant to the Permit. The applicant submits that OBL has not pointed to any prejudice which will accrue to it if an order is made limiting its participation to those matters listed in s 225(c) and (d). It further submits that an order to that effect would presumably reflect OBL’s real interest and changed position in the proceeding and would ensure that future mediation with OBL would be limited to those issues alone. Indeed, senior counsel acting for OBL conceded that the extent of its participation in the proceeding is limited to those matters listed in s 225(c) and (d) and that this concession rendered it unnecessary to make formal orders to that effect. Senior counsel for the applicant also submitted that this order also reflects the fact that the applicant has been successful in its interlocutory application.
On 18 July 2013, during the course of oral argument, senior counsel for the applicant directed the Court to the affidavit of Mr McGrath sworn 7 June 2013, where it was deposed at [117] and [118] as follows:
117For the reasons I have outlined earlier in this affidavit I believe it is important for OBL to remain a party to these proceedings.
118I am concerned that OBL have the ability to, and I consider that it is in OBL’ interests to:
118.1 participate in negotiations and mediation to the extent that tenure and extinguishment issues arise in the Overlap Area; and
118.2engage with the Applicant to explore whether non-native title outcomes, relating for example to the protection of Aboriginal heritage in the Permit area, may be addressed as part of the consent determination.
It was submitted by the applicant that while OBL was no longer putting connection in issue, its concern was that if OBL were to retain full party status, under the cloak of mediation OBL would be able to raise issues relevant to connection and ask the applicant to accept a non-native title outcome in relation to various parts of the Permit area. It was submitted that it would not be fair on the applicant, having had a party completely drop its opposition to the applicant’s case on connection to then, in confidential mediation, say that it would not agree to a consent determination unless and until the applicant agrees to a non-native title outcome in relation to their tenure. It was conceded by senior counsel for OBL on 18 July 2013, that [118.2] of Mr McGrath’s affidavit was something which OBL may wish to do, but which went beyond its Further Amended Notice and Amended Substituted Response. The applicant further submitted on 13 August 2013, that while on the one hand the order was unnecessary, that order would formalise and record what the parties agreed upon.
OBL submits that this order is unnecessary because:
(a)by its Amended Substituted Response and Further Amended Notice, both filed on 29 May 2013 pursuant to leave granted on 22 May 2013, OBL’s participation in the proceedings is confined to contesting extinguishment issues in the Overlap Area;
(b)OBL cannot amend those documents, and thereby broaden the ambit of its participation, without leave of the Court; and
(c)the applicant has conceded, properly, that the order will do no more than reflect that position.
In my view, particularly given the ambulatory nature of OBL’s approach to just what is in issue in these proceedings, it will provide certainty in the proceedings if OBL’s present position is formalised by making orders sought by the applicant.
Costs
The applicant is seeking the following costs orders:
1.OBL pay the applicant’s costs of the removal application on an indemnity basis or, in the alternative, on a party/party basis, such costs to include costs thrown away by reason of OBL’s volte face on the issue of connection; and
2.that costs be paid forthwith.
OBL submits that there should be no order as to costs. It was further submitted by OBL on 13 August 2013 that the order sought by the applicant restricting OBL’s participation was unnecessary and that the continuation of the proceedings after OBL was confined on the basis of its Further Amended Notice and Amended Substituted Response was unreasonable on the part of the applicant, which should have a consequence in costs. OBL seeks an order for costs from 15 May 2013, which, it submits, was the first time OBL became aware that the parties were no longer interested in any further mediation, or alternatively 20 May 2013, which was when OBL formally changed its position. It was submitted by senior counsel for OBL that the Further Amended Notice and Amended Substituted Response which were both filed on 29 May 2013, did not alter the substance of the documents filed on 20 May 2013. As to the last hearing which occurred on 13 August 2013, OBL submits that costs should lie with the State, as the only reason the matter was brought back on for hearing on that date was due to the State’s objection.
Section 85A of the NTA
The jurisdiction of the Court to award costs is conferred by s 43 of the Federal Court of Australia Act 1976 (Cth) (the FCA Act). The Court has a wide discretion, although it requires to be exercised judicially and in accordance with established principle. It includes the power to order that costs awarded against a party are to be assessed on an indemnity basis. This is as enacted by s 43(3)(g) of the FCA Act.
The principle is that costs would ordinarily follow the event in the absence of special circumstances justifying some other order: Ruddock v Vardarlis (No 2) (2001) 115 FCR 229 at [11]; Cheedy v Western Australia (No 2) (2011) 199 FCR 23 at [7]. However, this principle is, to an extent, modified by s 85A.
Section 85A of the NTA provides:
(1)Unless the Federal Court orders otherwise, each party to a proceeding must bear his or her own costs.
Unreasonable conduct
(2)Without limiting the Court’s power to make orders under subsection (1), if the Federal Court is satisfied that a party to a proceeding has, by any unreasonable act or omission, caused another party to incur costs in connection with the institution or conduct of the proceeding, the Court may order the first-mentioned party to pay some or all of those costs.
In Cheedy, the Full Court at [9] observed that it is well established that where s 85A applies:
(1)s 85A(1) removes the expectation that costs will follow the event, but the Court retains its discretion as to costs under s 43 of the FCA Act;
(2)the “unreasonable conduct” of the parties is not a jurisdictional fact which pre-conditions the exercise of the discretion, and on the other hand, s 85A(2) does not control or limit the discretion in s 85A(1);
(3)whilst the exercise of the discretion when making a costs order should be judicial, the starting point is that each party will bear its own costs; and
(4)it is not proper to use the power to award costs to punish either a successful or an unsuccessful party or as a deterrent to other would-be applicants: Reid v State of South Australia [2007] FCA 1479 at [54].
See generally, Ward v Western Australia (No 2) (1999) 93 FCR 305 and De Rose v State of South Australia (No 3) [2005] FCAFC 137. Finn J referred to these principles in a compendious way in McKenzie v State of South Australia [2006] FCA 891 at [8]. See also Reid v State of South Australia at [53], [54].
The discretion of the Court to make an order for costs must be exercised judicially after taking relevant considerations into account. Section 85A(2) focuses the inquiry on whether there has been an unreasonable act or omission by OBL which has caused the applicant to incur costs. I am satisfied for reasons I explain below that OBL’s conduct was unreasonable and warrants the making of a costs order. This in turn also informs the question under the general law as to whether such costs should be ordered to be paid on an indemnity basis.
Indemnity Costs
To warrant a departure from the ordinary rule that costs be paid on a party and party basis, there should be some special or unusual feature in the case. The question must always be whether the particular facts and circumstances of the case warrant the making of an order for payment of costs other than on a party and party basis: Colgate-Palmolive Company v Cussons Pty Limited (1993) 46 FCR 225 at 233, 234.
The Court in Hamod v New South Wales (2002) 188 ALR 659 at [20] stated:
[20] Indemnity costs are not designed to punish a party for persisting with a case that turns out to fail. They are not awarded as a means of deterring litigants from putting forward arguments that might be attended by uncertainty. Rather, they serve the purpose of compensating a party fully for costs incurred, as a normal costs order could not be expected to do, when the court takes the view that it was unreasonable for the party against whom the order is made to have subjected the innocent party to the expenditure of costs.
Costs be paid forthwith
The authorities identify three classes of cases in which a court might order costs payable forthwith. One of those classes concerns where the decision on the application determines a separately identifiable matter or may be viewed as the completion of a discrete aspect of the matter: Complete Technology Integrations Pty Ltd v Green Energy Management Solutions Pty Ltd [2011] FCA 1319 at [127]; Fiduciary Ltd v Morningstar Research Pty Ltd (2002) 55 NSWLR 1 at [10]-[11]; Australian Agricultural Co Ltd v AMP Life Ltd [2003] FCA 1134 at [13]-[14].
The applicant submits that costs should be payable forthwith due to there being a completion of a distinct section of the proceeding, being the termination of the issue on connection.
OBL’s unreasonable conduct
OBL submits that its conduct was not unreasonable, and that the causation between the asserted unreasonable acts or omissions and the incurring of costs does not arise. Alternatively, OBL submits that if its omission to give reasons for its change of position were to be characterised as an unreasonable omission, it was not causative of any costs incurred by the applicant. It is further submitted that if OBL’s omission to give reasons for its change of position were to be characterised as a causative unreasonable omission, it is not capable of being causative of any costs thrown away by the applicant, except costs incurred between the change of position on 16 May 2013, and the vacation of hearing dates on 22 May 2013. The orders of 15 March required the applicant to file evidence, among other things, by 17 May 2013.
OBL’s position is that it reasonably believed that, but for the interlocutory application, mediation would have been resumed shortly after 30 April 2013 and that the way was still open for the applicant and OBL to confer to limit or avoid the hearings scheduled to commence in July.
OBL says that the volte face occurred because:
(a)at the hearing on 15 May 2013 the applicant and the State disclosed to OBL, for the first time, that neither the State nor the applicant would negotiate further with it; and
(b)OBL was concerned that unless it made the change it would be removed as a party.
OBL further submits that in any event, even with a finding of unreasonable conduct, the prima facie position provided by s 85A(1) of the NTA should not be displaced in relation to the costs of the application because the applicant persisted in its application for an order restricting OBL’s participation despite conceding, in effect, that such an order is unnecessary.
OBL submits that the applicant is seeking onerous costs orders to punish OBL for not immediately, and without having its reasonably based concerns resolved, agreeing to be bound by the State’s decision not to require proof of connection. It submits that the effect of such an order will be to undermine the important principle that consent determinations not be made without agreement freely given on an informed basis.
I do not accept these submissions. I find that OBL’s conduct was unreasonable and such as to warrant an order as to costs in the proceedings. It was unreasonable in the following two ways:
(i)filing the Notice and the Response and thus becoming the only party to challenge the applicant’s case on connection in circumstances known to it where the State and other respondent parties had agreed in principle to a consent determination; and
(ii)after filing the Response it substituted a Further Amended Notice and Amended Substituted Response without any, or any proper, explanation.
I accept the applicant’s submission that in circumstances where:
(i)OBL has stated that it is not opposed to a consent determination;
(ii)the existence and the effect of the Permit is to be recognised in the proposed consent determination;
(iii)the State has assessed the applicant’s connection evidence and considers it sufficient to justify entering into a consent determination; and
(iv)every party other than OBL has accepted the State’s assessment of the connection evidence and also wish to enter into a consent determination,
it was unreasonable of OBL to refuse to be a party to the proposed consent determination.
I also accept the submission that in circumstances where:
(i)the State acts in the capacity of parens patriae to look after the interests of the community generally, by taking the lead in assessing the cogency and credibility of the applicant’s connection evidence; and
(ii)then approaches the other respondent parties to indicate that the State is prepared to settle the claim with a consent determination;
it was unreasonable for OBL, acting on its own and without the support of any other respondent, to press the applicant on to a hearing on connection without any, or any reasonable, basis. Further, when OBL first substituted and then later amended its Response, it did so without any, or any satisfactory, explanation for this volte face.
After OBL was joined as a party to the proceedings, the parties exchanged correspondence regarding the status of Final Report in the proceedings. OBL did not file, and never intended to file, anthropological evidence. The issues that were raised by OBL, based upon the Final Report, were addressed at length by the applicant in its letter of 21 March 2013.
It was unreasonable for OBL to file in Court documents putting connection in issue and stating that it would participate in the on-country hearing, without any real basis for challenging connection. In its volte face, contained in the Amended Substituted Response, OBL no longer took issue with connection and stated that it no longer intends to participate in the hearing. It was unreasonable for OBL, alone of all the parties, to put connection in issue after the State had indicated that it was satisfied that connection was likely to be established at any contested hearing and considered that the claim should be resolved by the making of a consent determination.
It is the case that, like OBL, the Commonwealth and Clover Cattle Co Pty Ltd and Quixot Pty Ltd also filed notices of intention to participate in the hearing of the connection evidence. However, it was apparent from the correspondence and the discussions between the parties that those parties had filed notices in order to comply with the programming orders made on 15 March 2013. The parties had been seeking instructions to settle and they did not file responses to the applicant’s SIFC due to be filed on 30 April 2013. Unlike OBL these parties never put the applicant’s case on connection in issue, which, as I have mentioned, in its Response, put the applicant to proof on all of the elements necessary to establish native title.
Moreover, the report to the Court on the outcomes of the mediation conference held on 5 April 2013 noted that the Commonwealth as well as Clover Cattle Co Pty Ltd and Quixot Pty Ltd were willing to be guided by the State in relation to matters concerning connection and were, in principle, willing to agree that the proceedings be resolved by way of a consent determination. That same report notes that OBL was not then able to agree to the consent determination proposed by the State.
I find that the applicant, prior to OBL filing its Response, had addressed OBL’s concerns raised both in mediation on 5 and 21 March 2013 and in letters from Hunt & Humphry, dated 18 and 20 March 2013. OBL was sufficiently informed, in the same way as all the other parties were, to have been able to agree to a consent determination, as now, belatedly it does.
In his affidavit sworn 7 June 2013, Mr McGrath deposed that he “formed the view that there was a real risk that OBL was going to be removed as a party to the proceedings if it did not immediately abandon its concerns about the bases on which the State had reached a decision to accept the Applicant’s connection claims”. Mr McGrath went on further to depose that “I believe that rather than being removed entirely as a party to the proceedings it was in OBL’s interest to remain a party and concede the connection issues”.
The applicant submits that the fact that Mr McGrath formed the view that there was a “real risk” that OBL would be removed as a party to the proceedings if it did not “abandon” its concerns about connection can only mean that he, presumably on advice, formed the view that it was likely that the Court would conclude that it would be in the interests of justice to remove OBL as a party. There is considerable substance to this submission.
Deficiencies in the applicant’s claim
OBL submits that at the time it was joined as a respondent, and subsequently, it had reasonable grounds to believe that there were significant deficiencies in the applicant’s claim, and that OBL should contest the applicant’s case, having regard to:
(a)the fact that the State’s position in late 2011 was that the applicant’s claim as then formulated was “fatally flawed”. It was conceded by OBL on 13 August 2013 that the applicant’s claim was considered to be “fundamentally flawed” not “fatally flawed”;
(b)the fact that the applicant’s position in late 2011 was that the applicant’s claim required more evidence to address the State’s position;
(c)the apparent disagreement among experts on the evidence in support of the applicant’s claim;
(d)uncertainty as to whether the claim boundary was correctly identified or agreed as between the applicant and the Warrwa No 2 claimants in WAD 258 of 2012;
(e)the lack of evidence of the applicant’s connection to the Overlap Area in the material relied on by the applicant in the Future Act Proceedings for grant of the Permit;
(f)the fact that the above material was presented 13 years after the applicant’s claim was lodged, and two months after the orders were made listing the proceedings for trial commencing 2 July 2013, being a time when it was reasonable to expect that the preparation of the applicant’s evidence would be well advanced; and
(g)the fact that OBL did not receive any evidence in relation to connection in the Overlap Area after the Future Act Decision was made.
Thus, OBL argues, it was reasonable for it (in common with the Commonwealth, Quixot Pty Ltd and Clover Cattle Pty Ltd) to give notice in March 2013 of its intention to participate in all aspects of the hearing.
None of these matters amounted to a significant deficiency in the applicant’s case on connection, on 15 February 2013 when OBL was joined as a party, on 19 March 2013 when it filed the Notice or on 30 April 2013 when it filed the Response. The position of the State and of the applicant in 2011, including the “apparent disagreement” among the experts at that time, bears little relevance to the circumstances in 2013. During that period there had been further negotiations and mediation between the applicant and the State following further extensive fieldwork by Dr Palmer and the applicant had served a copy of his Final Report in early December 2012.
OBL never re-assessed its position based on further evidence or legal analysis of the existing evidence, such that it no longer believed that it had “reasonable grounds” for contesting the applicant’s case on connection.
In any event, none of those so-called deficiencies was significant enough to prevent OBL’s volte face and abandoning its opposition to the applicant’s case on connection in its Amended Substituted Response filed on 29 May 2013.
The date from which costs were unnecessarily incurred
The applicant submits that OBL should meet all of its costs of preparation for the hearing from at least 5 April 2013, the date of the mediation conference at which the State and those other parties who had filed notices of intention to participate indicated their desire to settle the proceedings by way of a consent determination. Alternatively, the applicant submits that OBL should meet those costs from the date when OBL filed the Response, which was 30 April 2013. The applicant submits that those costs continued up until 29 May 2013 when OBL finally filed the Amended Substituted Response that reduced the issues to those of extinguishment to the Overlap Area. The applicant submitted on 13 August 2013 that it should be from when OBL filed the Notice which was 19 March 2013.
During the course of oral argument on 18 July 2013, senior counsel for the applicant submitted that OBL should pay the costs of the removal application and costs thrown away, firstly, because it was clear from the affidavit of Mr McGrath sworn 7 June 2013 and the submissions of OBL that the removal application was the impetus for OBL’s volte face on the issue of connection.
OBL accepts that the costs in time, money, resources and personal stress of hearings on-country of connection evidence are considerable. I am satisfied that OBL’s conduct has occasioned the applicant significant harm in respect to costs.
As at 5 April 2013, there were only 3 months remaining until the on-country hearing was to commence and 25 days later the programming orders provided that (by 30 April 2013) the applicant must file a witness proposal. The witness proposal required the applicant to indicate the names of the witnesses, the duration of their testimony, where they would give their evidence, as well as travel and accommodation details. The programming orders also provided that lay witness statements were to be filed by 17 May 2013, in less than 6 weeks.
The applicant’s solicitor had made the decision in early March 2013, based on the availability of resources and funding, to direct resources to the mediation process and away from preparing the lay evidence for hearing. On 19 March 2013, when OBL filed the Notice, the solicitor then re-directed the resources into the preparation of the case for hearing. Junior counsel, a consultant practitioner, two junior KLC lawyers as well as the solicitor on the record commenced working on preparing the case for hearing almost exclusively from that time to 29 May 2013 when OBL filed the Amended Substituted Response to the SIFC.
The applicant submits that OBL did not consider its obligations under ss 37M and 37N of the FCA Act to facilitate just resolution of disputes as “quickly, inexpensively and efficiently as possible”.
OBL submits that the overarching purpose defined in s 37M of the FCA Act is not simply to facilitate the resolution of disputes as quickly, inexpensively and efficiently as possible, but also requires that the resolution be “just”, and be “according to law”. OBL submits that the applicant’s submissions ignore those fundamental requirements which lie at the heart of the Court’s role in the administration of justice according to law.
OBL submits that the overarching principle does not require that, in every case, justice and fairness must be sacrificed on the altar of expediency – that a party must not contest apparent deficiencies in an opponent’s case, or must be denied an opportunity to identify the issues it seeks to litigate, simply to save time and expense. The Court’s priority is to do justice between the parties: Aon Risk Services Australia Limited v Australian National University (2009) 239 CLR 175 at [23], [30], [98] and [112]. The applicant submits that if OBL genuinely wanted to contest “apparent deficiencies” in the applicant’s case and wanted “an opportunity to identify the issues it seeks to litigate”, it was free to do so, but that was not what OBL did in this proceeding. The applicant submits that OBL, alone of all the parties, chose to put the applicant’s case on connection in issue, thus putting the applicant to the trouble and expense of preparing the case for hearing. Then, without any, or any adequate explanation, OBL dropped its opposition to the applicant’s case on connection.
I find that OBL was sufficiently informed by 7 March 2013 at the latest that the State had, upon reasonable grounds, taken the decision to consent to a determination of native title and was sufficiently informed both in fact and law as to why it had so decided.
It is not the case that justice and fairness will be sacrificed on the altar of expediency. In matters such as this the requirements of s 37M are met by parties, who are fully informed, as they were, and guided, according to native title applications and their likely outcome, if contested, by the decision of the State. All parties other than OBL did just that.
I find OBL’s reasons for the volte face on the issue of connection far from convincing.
I will order that OBL pay the applicant’s costs from 19 March 2013 when OBL filed the Notice. Its conduct, for reasons I have explained, has been most unreasonable and has occasioned the applicant considerable cost and expense. It should pay those costs, because of its thoroughly unreasonable conduct, on an indemnity basis. It had no real prospect, properly advised, of succeeding in its opposition to the existence of connection and should not have put that matter in issue.
This aspect of the proceeding is a distinct one. It has now been resolved. The costs should be paid forthwith.
Orders
There will, for these reasons, be orders that:
1.OBL’s participation in the proceeding be limited to leading evidence and making submissions in respect of the matters listed in s 225(c) and (d) of the NTA.
2.OBL pay the applicant’s costs of the interlocutory application dated 6 May 2013 including for the period since 19 March 2013 costs thrown away by reason of OBL changing its position on the issue of connection.
3.The costs, the subject of Order 2 be paid on an indemnity basis forthwith.
I certify that the preceding one hundred and ten (110) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Gilmour. Associate:
Dated: 24 February 2014
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