Yarri Mining Pty Ltd v Eaglefield Holdings Pty Ltd & Ors

[2011] HCATrans 89

[2011] HCATrans 089

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Perth  No P30 of 2010

B e t w e e n -

YARRI MINING PTY LTD ACN 120 304 261

Applicant

and

EAGLEFIELD HOLDINGS PTY LTD ACN 009 327 093

First Respondent

NARNOO MINING PTY LTD ACN 084 713 100

Second Respondent

MINISTER FOR ENERGY, RESOURCES, INDUSTRY AND ENTERPRISE

Third Respondent

DIRECTOR GENERAL OF MINES

Fourth Respondent

Application for special leave to appeal

HAYNE J
BELL J

TRANSCRIPT OF PROCEEDINGS

FROM CANBERRA BY VIDEO LINK TO PERTH

ON FRIDAY, 8 APRIL 2011 AT 12.21 PM

Copyright in the High Court of Australia

__________________

MR S.G. O’BRYAN, SC:   May it please the Court, I appear with MR J. GARAS on behalf of the applicant.  (instructed by Lawton Lawyers)

MR A.S. BELL, SC:   If the Court pleases, I appear for the second respondent.  (instructed by Tottle Partners)

HAYNE J:   The first, third and fourth respondents have all filed submitting appearances, as I understand it.

MR BELL:   That is so, your Honour.

HAYNE J:   Yes, Mr O’Bryan.

MR O’BRYAN:   Your Honours, in this application we raise as a matter of, we submit, general importance, at least for mining interests in this State, the principal construction issue we lost below, being whether a prohibited applicant for a mining rights grant can make a valid application and receive a valid grant, the circumstances being that we are instructed much of the State’s land area is, at any given time, subject to mining applications and tenement grants of one kind or another such that there will continue to be many grants that become subject to compulsory surrender. 

The moratorium period that is applicable to surrenderors and their agents under section 69(1) of the Mining Act, as well as the mirror provisions that are found in the Mining Act that relate to other kinds of tenements, that scheme of surrender, compulsory surrender and moratorium period is called locally, I understand, the turnover principle.

Your Honours, the way things presently stand with the decision below is to simply highlight how easy it is for the legislative intent regarding the turnover principle to be frustrated by those who try to queue jump by making prohibited “on behalf of” applications that are in breach of section 69 and its mirror provisions in not readily identifiable names and without declaring that that is what they are doing, for those who process the applications on behalf of the Minister cannot be expected to conduct investigations in the ordinary course and would be expected, we submit, as in the facts of this case, to take names that appear on written applications and compliance with section 69(1) at face value, bearing in mind that the facts relevant to a breach of section 69(1) will normally be known only to the applicant who submits the piece of paper called the application.

BELL J:   When they become known the applicant is subject to liability to a criminal penalty if they have been engaged in queue jumping.  What seems to have some force in the reasoning below is the view that for a party to come along eight years later and be able to upset arrangements that are in place and that may affect third parties is a construction that might favour a view that invalidity was not to attend breach of 69.

MR O’BRYAN:   Yes, your Honour.  Can I say two things?  We did argue below that it is highly problematic whether the general penalty provision applies to a breach of section 69 and we have, in our written submissions, addressed that.  For example, could I give one example?  If you look, your Honour, at application book page 33 the text of section 58 is set out and that deals with applications.  If the learned President is right in the certainty that section 154, the general penalty provision applies to a breach of 69, it must apply to 58.  So that if you do not put a form in, in the prescribed form, if you do not accompany it with a statement per subsection (b); if you disobey (c) and do not accompany it with the amount of the prescribed rent, then you have committed an offence too.  We made submissions below ‑ ‑ ‑

HAYNE J:   Why, when one is a prohibition and the other one is simply an application section? 

MR O’BRYAN:   Granted that, your Honour, but ‑ ‑ ‑

HAYNE J:   Section 69(1) says thou shalt not.

MR O’BRYAN:   Yes, but 154 says a breach of the Act and it says you shall.  But we made submissions below to the effect that one cannot be sure about 154 applying.  Secondly, but perhaps more importantly for the purposes of this application, the problem lies in the restriction on prosecution to 12 months after when the offence was committed.  In many cases, we submit, it is likely that it will take far longer than 12 months to discover a covert breach of section 69(1). 

The facts of this case are, we are instructed, typical of your typical application that it will take more than a year for the application to be looked at and granted.  In this particular case the facts that are recited in the judgments below show that it took nearly three years for the application to be granted, a reflection of the fact that there are numerous applications being made in this State all the time.

So our point, your Honours, really is and even if section 154, the penalty section applies, that absent invalidity of grant as a sanction those who might breach section 69 and its mirror provisions would be expected to have good prospects of avoiding any sanctions on account of, if nothing else, the 12‑month restriction on prosecution, the fact that the grant cannot, as the learned President observed in her reasons, be forfeited under another provision of the Act, section 63A.  Hence, the most compelling thing to give full force and effect to the moratorium period is to regard Parliament as having intended a breach of section 69 to lead to invalidity.

BELL J:   Mr O’Bryan, that does not seem to come to terms with the statement of the countervailing considerations of the primary judge beginning at application book 12, paragraph 36 and following, particularly paragraph 37, where his Honour points out the public nature of the register of mining tenements, the circumstance that the licence may be sold, mortgaged or charged as security, without ministerial approval.  The notion that eight years later one can come back and visit invalidity has its unattractive qualities, in light of those considerations.

MR O’BRYAN:   Yes, your Honour.  All that I can say is that they happen to be the facts of this case.  But if the proper construction of the Act is as we contend it is then, of course, there will be facts of other cases where you do not come back eight years later.  Invalidity can be found at an earlier stage.  But yes, that may be so in a certain case with facts like this case.  But really the question is, or it was below, what is the proper construction of the Act?

Can I say, your Honours, just dealing for a moment with the merits that as your Honours are aware section 57(1) of the Act expresses itself – that is the application section of the Act – as being subject to the Act.  Now, section 57(1) deals, in part, with applications by persons which we submit is exactly the subject matter that section 69(1) deals with.  It deals with the general subject matter of applications by persons, but in a different way it narrows who may make applications by prohibiting certain persons.

In other words, we submit that what has been overlooked below is a correspondence between the language of 57(1) and 69(1).  They both deal with the very same subject matter and if ever there were a section likely to have been intended by Parliament for section 57(1) to be subject to, 69(1) and its mirror provisions must be, we submit, the star candidate in that regard.  That is perhaps the main point that we tried to argue below, but obviously unsuccessfully. 

Therefore, if one is required, as we understand the state of things, particularly after Project Blue Sky, to have regard principally to the text, as well as the scope and purposes of the Act, then the text corresponds between the two sections very, very neatly.  You can contrast that, we submit, with some of the decisions that the learned President refers to in her reasons like this Court’s decision in Hunter Resources, dealing with the failure to properly, I think, mark out land or something of that nature and a case like Creasy v Hot Holdings where there was a failure to give notice to pastoral leaseholders in contravention of section 118 of the Act. 

Those kinds of cases area readily distinguishable, we submit, from the present case because the language of the provision that is briefed does not correspond with the subject matter of the language of section 57(1) or the application provision.  It does not correspond.  Therefore, one cannot see from the text of the Act any guidance on invalidity and then other considerations come to bear, including third party prejudice.

But we do have, we submit, a very direct correspondence in language which we submit was a very significant matter that the court failed to give weight to, instead jumping as the first reason for validity to the question of potential third party prejudice, which is always there and will never go away in a case of invalidity, and to other considerations that we submit are really in the scheme of things neither here nor there.

The learned President gave four reasons, I think, towards the end of her judgment, which are set out – your Honours, no doubt will have seen – set out on application book page 44.  Apart from third party prejudice the second reason is that in a case of invalidity breaches of the moratorium period would be equally serious and that seriousness would not be a factor.  But we submit it should not be a factor.  You are queue jumping to your advantage and the disadvantage of other people who are entitled to apply.  Whether you do it on day one or day 31 of the – I am sorry, day 91 or whatever it is of the moratorium period you are still queue jumping and you are effectively blocking other people out. 

The third reason her Honour gave was the purpose of the statutory moratorium to give persons other than the former holder the opportunity to apply for a licence within the three‑month period.  There may be no interest in the matter until many years later that ‑ ‑ ‑

HAYNE J:   Mr O’Bryan, we have read these things.

MR O’BRYAN:   Yes, and we simply say that may be so, but then again it may not be so and the person who gets their foot in the door in the moratorium period effectively, unless caught out, closes the door to anybody else because they get priority and that is the end of it.  So it is understandable why nobody might choose to apply once they see that someone else, who they assume is a legitimate applicant, has applied.  I have already addressed the penalty, which is the fourth reason.

Your Honours, as you will have seen we also have referred in our submissions to some provisions in some other State and the Northern Territory legislation which we readily concede is not our biggest point, but we nevertheless admit it is worthy of weight, particularly in the case of Queensland which has provisions that are the most similar to Western Australia compared to the other States and Territory we mention.  Queensland has a turnover principle, a moratorium period applying to surrenderors and it is actually quite a lengthy period of two years in Queensland, whereas, the other States and the Territory we mention have a moratorium period, but it appears to be a blanket period on all people, not just surrenderers. 

At least on the merits your Honours will have seen that we at least achieved a recognition by the learned President that our primary argument, primary construction argument was respectable.  We got less favourable treatment in our secondary fallback argument, which relates to section 105B of the Act.  Your Honours will have seen the text of 105B in paragraph 16 of the reasons.  Our argument simply builds on the argument that the prohibition in section 69, referring as it does not just to persons, but before it gets to persons to land can be and should be treated as effectively a closure of land if you like or land not open to mining, which is one of the opening themes in an early part of the Act, to prohibited persons.

There is the case, if I could just mention, that your Honours will have seen reference to in the reasons below, the local case here in the Supreme Court of Atkins v Minister for Mines and her Honour deals with that somewhere – I will find it in a moment – where it was held that the Minister did not have the power to grant an exploration licence over land that was the subject of a notice issued under section 57(4).  Section 57(4) is at the top of application book 33, your Honours.  The language, we submit, is similar in that what the Minister can declare is:

that no application for an exploration licence shall be made or granted with respect to any land comprising the area or any land -

et cetera, and if you compare that to the language of 69 there is a similarity in that 69 prohibits applications over land, the difference being land in respect of which Parliament prohibits certain persons from applying for.  Here under 57(4) the difference is – the material difference, we submit – is that it is the Minister who declares, in a more general sense, that no application shall be made or granted over land.

The question arose and was argued below whether “or granted” made the difference as to why a breach of 57(4) leads to invalidity and not 69(1).  But when one looks at the reasoning in Atkins of his Honour Justice Rowland it does not seem to depend on the words “or granted”.  It seemed to depend more on the Minister saying you cannot make an application over land. 

The learned President, your Honours will have seen, accepted our argument that the reference to “or granted” can be explained by a situation where an application has been made, but not yet granted and then the Minister makes the declaration so that you need to deal with that hybrid situation which explains the language.  Sections 57(4) and 69(1), we submit, in the language are very similar in substance and there is no good reason why Atkins that was not challenged below seems to be accepted to be the law in Western Australia, should have been decided any differently to this case.  Those are our submissions, if the Court pleases.

HAYNE J:   Thank you, Mr O’Bryan.  We will not trouble you, Dr Bell.

An appeal to this Court would enjoy insufficient prospects of success to warrant a grant of special leave to appeal.  Special leave is refused. 

MR BELL:   We seek costs, your Honour.

HAYNE J:   Can you resist costs, Mr O’Bryan?

MR O’BRYAN:   No, your Honour.

HAYNE J:   With costs.  The Court will adjourn to reconstitute.

AT 12.42 PM THE MATTER WAS CONCLUDED