- Unreported Judgment
 QSC 97
SUPREME COURT OF QUEENSLAND
Papillon Mining & Exploration P/L v Minister for Mines and Energy  QSC 97
PAPILLON MINING & EXPLORATION PTY LTD (IN LIQUIDATION) ACN 072 678 178
9358 of 2008
7 May 2009
8 December 2008
Administrative law – Judicial review – Grounds of review – Irrelevant considerations – Relevant considerations – Adverse effect on public interest – Political considerations – Fact of public objections – Ministerial decision – Renewal of mining lease
Energy and resources – Minerals – Determination of titles – Expiry of term of lease – Application for renewal – Power of minister to refuse
Words and phrases – “appropriate” – Resources to carry on mining operations
Mineral Resources Act 1989 (Qld), s 286A, s 287
Harburg Investments Pty Ltd v Mackenroth  2 Qd R 433;  QCA 243, followed
O'Sullivan v Farah (1989) 168 CLR 210;  HCA 61, referred to
Sinclair v Maryborough Mining Warden (1975) 132 CLR 473;  HCA 17, referred to
Both applicants: P Hastie
Respondent: R Douglas SC with S McLeod
Both applicants: Deacons
Respondent: Crown Solicitor
- FRYBERG J: The applicants, whom it is convenient to describe collectively and individually as “Papillon”, seek review of the decisions of the respondent (“the Minister”) to refuse Papillon's applications to approve the assignment of mining lease 50124 to Golden Surprise Pty Ltd and to renew that lease.
- On 5 December 1996 the Governor in Council granted Papillon a mining lease pursuant to s 234 of the Mineral Resources Act 1989 (“the Act”) in respect of a little over 13 ha of land at North Arm, an area about 4 km north of Yandina and a little east of the Bruce Highway, for a term of 10 years commencing on 1 January 1997. Gold had been mined on the land the subject of the lease from 1929 to 1938. Papillon commenced reprocessing tailings in 1997. Little gold was obtained and in 2004 Papillon went into liquidation. In February 2006 it contracted to sell the mine to Golden Surprise Pty Ltd. On 8 May 2006 it applied to the Mining Registrar under s 300 of the Act for the Minister's approval of the assignment of the lease to that company. On 27 June 2006 it applied to the Registrar under s 286 for a renewal of the lease.
- On 17 May 2007 the Minister gave Papillon a notice under s 286A(5) of the Act to show cause why the application for renewal should not be refused. Papillon responded with a written submission on 13 June 2007. At some time before the end of 2007 the Minister received an objection, apparently oral, from Mr Peter Wellington MP, the local Member of Parliament. It seems that Mr Wellington had made a number of previous submissions to the Minister or his predecessors in respect of mining leases in the area and had presented petitions to Parliament opposing mining. In January 2008, in response to an invitation from the Department, a local group calling itself North Arm Watch wrote to the Minister through a Mr Cole asking that the applications be disallowed [sic]. On 25 August 2008, after some further correspondence between the parties in which Papillon responded to the objections, the Minister decided, to refuse the application for renewal and decided not to approve the exercise of the power to assign.
- On the same date, the Minister signed a statement of reasons for his decision to refuse the application for renewal. It set out a summary of the relevant legislation and of the background facts, and continued:
“Findings on material questions of fact
I make the following findings of fact:
1)The mining lease holder, Papillon, is in liquidation.
2)The only remaining asset of value available to Papillon is the mining lease.
3)Despite the mining lease being granted in 1996, only 0.8 kilograms of gold has even been produced with a total value of only $3,100.
4)No mining has been undertaken since April 2004.
5)There has never been any financial return to the State from the mining lease.
6)There is insufficient data to establish a reasonable estimate of the mineral resources present.
7)There are no existing jobs at risk.
8)There is public opposition to the mine.
9)The public opposition is supported by the local Member of Parliament, Mr Peter Wellington.
Reasons for the decision
I make my decision to refuse the applicant for renewal of ML50124 for the following reasons:
- I am satisfied that Papillon does not have the financial or technical resources available to carry on mining operations under a renewed lease (section 286A(1)(f) of the Mineral Resources Act 1989).
- I am not satisfied that the public interest will not be adversely affected by a renewal of ML50124 because of the findings of fact in paragraphs 3), 4), 5), 7), 8) and 9) (section 286A(1)(g) of the Mineral Resources Act 1989).
- In relation to the first reason stated above, I am aware that there is also an application for Papillon to assign ML50124 to Golden Surprise. Whilst it may be accepted that if the assignment were approved Golden Surprise may have the financial and technical resources available to carry on mining operations under a renewed lease, I consider that the lease should not be renewed in any event because there is public opposition to the mine, which opposition is supported by the local Member of Parliament.”
- Although not obliged to provide a statement of reasons for his decision to refuse the assignment, the Minister chose to do so. Relevantly, it was short and to the point:
“Findings on material questions of fact
I made the following findings of fact:
1)The application to renew ML 50124 was refused by me today.
Reasons for the decision
I made my decision for the following reasons:
- As a result of my decision to refuse the renewal of ML 50124, ML 50124 is no longer in force and is no longer capable of being assigned.”
The matters for decision
- The circumstances give rise to the following questions:
- Did the Minister have power to decide, or at least to decide by refusal, an application for the renewal of a mining lease?
- Did the Minister commit a reviewable error
- In determining the renewal application?
- In not dealing with the assignment application before dealing with the renewal application?
The power to refuse
- Section 286A of the Act provided:
“286ADecision on application
(1)Subject to part 17, division 5, the Governor in Council may grant an application for the renewal of a mining lease if the Minister is satisfied of each of the following—
(a)the holder has complied with—
(i)the terms of the lease; and
(ii)this Act in relation to the lease;
(b)the land the subject of the lease—
(i)still contains workable quantities of mineral or mineral bearing ore; or
(ii)is otherwise required for purposes for which the lease was granted;
(c)the proposed term of the renewed lease is appropriate;
(d)having regard to the current and prospective uses of the land comprised in the lease, the operations to be carried on during the renewed term of the lease—
(i)are an appropriate land use; and
(ii)will conform with sound land use management;
(e)the land and surface area for which the renewal is sought is of an appropriate size and shape in relation to the activities proposed to be carried out;
(f)the financial and technical resources available to the holder to carry on mining operations under the renewed lease are appropriate;
(g)the public interest will not be adversely affected by the renewal;
(h)for a lease subject to a condition mentioned in section 285—the lease should be renewed.
(2)If the application is for a lease subject to a condition mentioned in section 285, the Minister must advise the Governor in Council of the fact.
(3)The renewal may be granted for the further term, decided by the Governor in Council, that is not longer than the period for which compensation has been agreed or determined under section 279, 281 or 282.
(4)The renewed lease is subject to—
(a)any conditions prescribed under a regulation; and
(b)any conditions decided by the Governor in Council.
(5)The Minister may refuse the application if the Minister—
(a)has served on the holder a notice in the approved form asking the holder to show cause, within the period stated in the notice, why the application should not be refused; and
(b)after considering the holder’s response, is satisfied the application should be refused.
(6)As soon as practicable after deciding the application, the Minister must give the holder a written notice stating—
(a)the decision; and
(b)if the decision is to recommend the grant of the renewal on conditions, or to refuse to recommend the grant of the renewal, the reasons for the decision.”
- Papillon submitted that under that section, only the Governor in Council can make a decision about renewal. The satisfaction of the Minister of the matters in sub-s (1) is a precondition for granting a renewal, but that subsection confers no decision-making power on the Minister. The power of the Governor in Council is very wide; it includes the power to determine the term of the renewal (subject to the limitation in sub-s (3)), and the power to decide fresh conditions (sub-s (4)). Sub-section (6) demonstrated that the Minister's power was limited to recommending a refusal.
- I accept that the Governor in Council does have wide powers under s 286A, and that these probably include the power to refuse the application. However that does not mean that the Minister lacks power to refuse. In my judgment that power is conferred by sub-s (5). The language of sub-s (5) is echoed in the opening phrase of sub-s (6): “after deciding the application, the Minister must …”. A refusal to recommend to the Governor in Council is the same as a refusal of the application.
- It may be that the power of the Minister is limited to refusing an application on the ground that he is not satisfied of one of the matters referred to in sub-s (1), and that if he wishes the application to be refused on a different ground, his only option is to induce the Executive Council to recommend refusal to the Governor. It is unnecessary to decide that question in the present case, since the refusal was based on paras (f) and (g) of s 286A(1). Papillon's submission required the reading of the words “to refuse to recommend that the grant” as if they read “to recommend the refusal of the grant”. It is not clear that they need to be so read; that might be affected by the answer to the question left unresolved.
- It is true that this interpretation appears to leave no work for s 287; but neither does the interpretation contended for by Papillon. Perhaps that section should have been repealed when ss 286 and 286A in their present form were inserted. Whatever the position, I do not think the existence of s 287 provides support for a different interpretation from that adopted above. This Act has grown like Topsy. In the 20 years since its enactment in 1989 it has been amended by 69 other Acts, many of which had a primary focus quite removed from mining. In such circumstances it is hardly surprising that its provisions lack coherence. Presumptions of interpretation which assume coherence are not of assistance here.
- I hold that the Minister had power to refuse the application to renew the mining lease.
The refusal of the application to renew
The first and third of the Minister's reasons: Papillon's financial resources
- The first of the Minister's reasons invoked para (f). It was able to do so only because the Minister dealt with the application for renewal before he dealt with the application for assignment, notwithstanding that they were lodged in the opposite sequence. The question under para (f) was not whether Papillon had sufficient financial resources to operate the mine itself. It was whether the financial resources available to it to carry on mining operations were “appropriate”. It was perfectly clear that Papillon did not intend to carry on mining operations itself. It had no financial resources, but it did not need any; it would be spending nothing. It follows that the resources available to it were, within the meaning of para (f), “appropriate”. This was not a valid reason for refusing the application for renewal.
- It may be that “holder” in para (f) should be construed to refer to a person who, to the Minister's knowledge, will be the holder (ie will be the person in whose name the lease is recorded) during the renewed term, not to a person who is the holder on the date of the Minister's decision but who will, if the lease is renewed, cease to be the holder in the future. Such a construction would accord with s 286F, which provides for renewal to be in the name of an approved assignee. That possible construction was not referred to in argument. It is unnecessary to resolve the point, since it was accepted on behalf of the Minister that Golden Surprise Pty Ltd had appropriate financial and technical resources available to it.
- The third reason is expressed to be “in relation to the first reason”. It does not advance the first reason, nor does it in terms provide an alternative reason to it. Although it is expressed in somewhat clumsy terms, I take it to be an expression of the Minister's opinion that whatever the merits of the first reason, the second reason by itself is a sufficient ground for refusal of the application.
The second of the Minister's reasons: the public interest
- The Minister declared himself unsatisfied that the public interest would not be adversely affected by a renewal because of the findings of fact set out in paras 3-5 and 7-9 of his findings. Papillon submitted that the first four of those findings could not support that state of mind. They could only be a reason for concluding that there was no positive benefit in the mining or that there would be no adverse effect on the public interest because the public was getting nothing out of the mine in any event. It suggested that the Minister had asked, was he satisfied that the renewal was in the public interest rather than, was he satisfied that the public interest would not be a adversely affected by the renewal. As to findings eight and nine, it submitted that they were entirely irrelevant to the processes which the Minister was required to undertake under the Act and that public opposition could not be enough to justify non-renewal.
- There is I think some force in the proposition that the absence of risk to jobs can not contribute to a lack of satisfaction that the public interest will not be adversely affected by the renewal. One might have thought that the presence of such a risk could make such a contribution, but not its absence. However save for that reference, I reject Papillon's submission.
- It would in my judgment be open to the Minister to proceed on the basis that the renewal of a mining lease over land which could not be economically mined would adversely affect the public interest. Mining leases confer rights good against the world. They constrain land use. To continue a lease which cannot economically achieve its purpose is capable of being regarded as adversely affecting the public interest. It follows that in considering whether he was satisfied that there would be no such adverse effect, it was legitimate for the Minister to take into account the history of mining at the site. The fact that in over seven years of mining, only a minute amount of gold had been produced, that no royalties had been paid and that mining had ceased in April 2004 all suggested the real possibility that there could be an adverse effect on the public interest. Papillon did not suggest that there was evidence before the Minister which conclusively rebutted that possibility. In my judgment findings three, four and five could support a lack of satisfaction that the public interest would not be adversely affected by the renewal.
- Papillon further submitted that public opposition was irrelevant. It submitted that the Minister made the same error as was made by the mining warden in Sinclair v Maryborough Mining Warden. In that case, Barwick CJ, with whom Murphy J agreed, wrote, in a passage relied on by Papillon:
“It cannot be doubted, in my opinion, that the matters raised and evidenced by the objector were matters of general public interest. The mining warden apparently did not consider them so to be because of the limited group which constituted the Fraser Island Defence Organization. I have set out the full text of the warden's decision and I am unable to read it in any other sense than that the mining warden thought that, because the appellant was representing the views of a section of the public, he, the warden, was unable to conclude that the interests of the public generally would be prejudicially affected by the granting of the leases.
The use by the warden of the expression ‘public interest as a whole’ indicates to my mind that the warden failed to understand that irrespective of the interests of the objectors or their number and, indeed, irrespective of the existence of an objection on that ground, he was bound to consider whether the granting of the application would prejudicially affect the public interest. If he had realized this he could not, in my opinion, have drawn the irrelevant distinction between the views of a section of the public and the public interest as a whole.”
- In my judgment, that passage does not assist Papillon. In Sinclair the warden's error was to hold that matters which were inherently matters of general public interest could not be so because they were raised by a limited group. That is not the position in the present case. A limited group has raised matters which the Minister has taken into account. He was correct to do so. That appears from what was written by Jacobs J. (concurring) in Sinclair:
“The public interest is an indivisible concept. The interest of a section of the public is a public interest but the smallness of the section may affect the quantity or weight of the public interest so that it is outweighed by the public interest in having the mining operation proceed. It does not however affect the quality of that interest. The warden looked for what he described as the public interest as a whole and he did so in contradistinction to the interest of a section of the public. Moreover, he limited the area of public interest to the section of the public who propounded the views expressed by the objector. This was not permissible. The views may have been propounded by a section of the public but the matters raised went to the question of the interest of the public as a whole. The warden appears not to have given weight to the fact that the evidence produced by the objectors should be regarded as evidence on the public interest generally and needed to be weighed in all the circumstances of the public interest whether or not the evidence and the views therein were put forward by a large or a small section of the public.”
- Next Papillon submitted that the Minister erred by taking into account the fact that objections were made while ignoring the substance of those objections. That submission was supported by reference to a passage in the judgment of Stephen J in Sinclair:
“Any consideration of the public interest for the purposes of reg. 39 (2) (a) should, I think, involve the weighing of benefits and detriments. … In some special contexts questions of the public intserest may not involve this process of weighing against each other conflicting merits and demerits; where however the concept of the public interest occurs as a factor in the grant or refusal by the Crown of a mining lease it can, I think, have only this meaning.”
- In my judgment, the evidence in the present case does not support a conclusion that the Minister failed to take the merits of the objections into account or that he failed to weigh them against other aspects of the public interest. Mr Cole's objection referred to the adverse effects of blasting, the potential for spillage or contamination to affect tourism, the history of attempts to expand the mine which failed in the Land and Resources Tribunal in the face of public opposition, meetings in 2003 between Cabinet Ministers and community representatives regarding concerns about mining on the Sunshine Coast and the alleged successful prosecution and fining of the directors of Papillon for “non-compliance issues”. The Minister gave Papillon several opportunities to make submissions, including in response to the objections, and he referred to those submissions in his reasons. There is nothing to suggest that he ignored the content of those submissions. I would be reluctant to draw such an inference in the absence of cross-examination on the point.
- Papillon then submitted that even if the Minister took the substance of the objections and submissions into account, he erred by also taking into account as a material fact the mere fact that the objections were made. It submitted that the nature of the public interest referred to in the Act should be ascertained by having regard to the terms of the Act, in particular to the objectives of the Act set out in s 2. The mere existence of public objections was irrelevant to those objectives.
- It is no doubt correct that in ascertaining the ambit of any discretion vested in the Minister, close regard must be paid to the terms of the Act. It is I think also correct that in identifying what is comprehended by the public interest under the Act it is relevant to have regard to s 2. But as counsel for Papillon conceded in argument, s 2 cannot be regarded as setting out an exclusive list of factors. Whether the existence of public objections is a relevant consideration must be determined having regard to the Act as a whole.
- One aspect which is in my judgment of considerable importance is that the decision maker is the Minister, not a mining warden or tribunal. Parliament has chosen to make the Minister's state of mind a relevant consideration. The fact that it is the Minister who is the repository of the state of mind in question strongly suggests that it was intended that political considerations could be taken into account in reaching the relevant state of mind. Papillon rejected that view, submitting that the prospect that the Government might suffer at the next election for renewing the lease was an improper consideration for the Minister to take into account. Counsel submitted that only if public opposition was of such magnitude as to create the risk of rioting or public disturbance could it be otherwise, and there was no suggestion of that in the present case. On the contrary, the magnitude of the opposition was so small that it was incapable of having any effect. The mere existence of objectors could not warrant a conclusion about public interest.
- That submission immediately encounters an obstacle in the form of the decision of the Court of Appeal in Harburg Investments Pty Ltd v Mackenroth. That was a case where the relevant Act provided for appeals to the Minister from decisions of the relevant authority by persons adversely affected by those decisions. The Minister was empowered to set aside or vary a decision if (among other things) satisfied that the public interest would not be adversely affected. In refusing to set aside a decision the Minister placed reliance on the existence of strong community objections and a high level of community concern, whatever the reasons for it may have been. McPherson JA held that he was entitled to do so on the authority of a number of decisions of the High Court. He wrote:
“ A statutory provision which sets up, without defining it, ‘public interest’ as the relevant criterion for decision and vests the power of determining it in a Minister of the executive government leaves little room for challenging the decision in a court of law. The expression ‘in the public interest’, when used in a statute, was said in O’Sullivan v Farrer  HCA 61; (1989) 168 CLR 210, 216, to import:
‘a discretionary value judgment to be made by reference to undefined factual matters, confined only ‘in so far as the subject matter and the scope and purpose of the statutory enactments may enable ... given reasons to be [pronounced] definitely extraneous to any objects the legislature could have had in view’.”
See generally Minister for Aboriginal Affairs v Peko Wallsend Ltd  HCA 40; (1986) 162 CLR 24, at 40. Such a discretionary judgment extends to include taking account of “the likely reaction of the community” to the action proposed: South Australia v O’Shea  HCA 39; (1987) 163 CLR 378, 388. There may, it was said in Hot Holdings Pty Ltd v Creasy  HCA 51; (2002) 210 CLR 438, 455, be cases:
“in which a decision-maker, especially a Minister, may properly have regard to a wide range of considerations of which some may be seen as bearing upon such matters as the political fortunes of the government of which the Minister is a member and, thus, affect the Minister’s continuance in office”.
The “whole object” of a statutory provision placing a power in the hands of a Minister is so that “he may exercise it according to government policy”: ibid.”
Jerrard JA and White J agreed.
- Papillon sought to distinguish Harburg on the basis that it and two of the High Court authorities referred to in it were in a class of their own. What was said in Harburg was said in the context of an issue which could bring about excitement in the community. Counsel submitted that what might apply in cases relating to gaming and the release of sexual offenders did not apply to a case about the renewal of a lease for a mine. The former had moral overtones but the latter was morally neutral. That is not a valid legal ground of distinction, nor is it a ground which finds any foundation in the reasons for judgment in Harburg.
- A further attempted distinction was that in Harburg, there was evidence of “strong community objections and a high level of public concern”, while in the present case the only objections came from the local member of Parliament and one member of the public claiming to represent a group of indeterminate size and influence. It is not for the court to attempt to assess the strength of the opposition contained in the objections or the number of people involved. The court is in no position to do so. These are essentially political questions. They are a matter for the Minister. There is no suggestion that the objections were trivial or that the Minister was not acting in good faith.
- In my judgment the reasoning in Harburg is relevant in the present case, and I should follow it. It supports the Minister's contention that the power was validly exercised. The Minister's second reason for refusal discloses no reviewable error.
- It was not submitted that the decision could be set aside merely on the basis that one of the Minister's reasons could not be supported. The argument before me proceeded on the assumption that if the Minister had power to refuse the application, his decision could be reviewed only if none of his reasons could support it.
- I hold that it was open to the Minister not to be satisfied that the public interest would not be adversely affected by a renewal of the mining lease.
The sequence of dealing with the applications
- In the circumstances it is unnecessary to determine whether dealing with the application for renewal before the application for approval of the assignment constituted an abuse of power.
- The application should be dismissed. I shall hear the parties on costs.
 Acts Interpretation Act 1954, s 32CA(1).
 The section seems to assume that a recommendation would be made by the Minister. The evidence does not disclose what is the accepted constitutional practice in Queensland in this regard. If (as one might have expected) recommendations are normally made by the Executive Council, the Act might imply a departure from that practice in this case.
 (1975) 132 CLR 473;  HCA 17.
Ibid at paras  and .
Ibid at para .
Ibid at paras  and .
 O'Sullivan v Farah (1989) 168 CLR 210 at p 216.
 2 Qd R 433;  QCA 243.
  2 Qd R 433 at p 438.
 Ibid at p 436.
 A reference to South Australia v O'Shea (1987) 163 CLR 378;  HCA 39.
- Published Case Name:
Papillon Mining & Exploration P/L v Minister for Mines and Energy
- Shortened Case Name:
Papillon Mining & Exploration Pty Ltd v Minister for Mines and Energy
- Reported Citation:
 QSC 97
07 May 2009
|Event||Citation or File||Date||Notes|
|Primary Judgment|| 1 Qd R 452||07 May 2009||-|