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Queensland Judgments
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Mineralogy Pty Ltd & Anor v The State of Western Australia

Unreported Citation: [2020] QSC 344
EDITOR'S NOTE

Mineralogy and International Metals (the applicants) obtained enforcement orders, pursuant to s 35 of the Commercial Arbitration Act 2013, at an ex parte hearing on 13 August 2020. The State of Western Australia applied for the orders to be set aside. Justice Martin held that the orders should be set aside because the application was not properly made ex parte, and because the applicants had not disclosed all of the material facts, and had misled the Court in some respects. Contrary to a suggestion by the applicants, the recent passage of the Iron Ore Processing (Mineralogy Pty Ltd) Agreement Amendment Act 2020 (WA) did not deprive the Court of the ability to set aside the orders.

Martin J

25 November 2020

Background

On the 13th of August 2020, Mineralogy Pty Ltd and International Minerals Pty Ltd (“applicants”) successfully applied on an ex parte basis for orders enforcing two arbitral awards, pursuant to s 35 of the Commercial Arbitration Act 2013 (“CA Act”). [2].

This judgment concerns an application by Western Australia (“WA”) to have the enforcement orders set aside. [3]. The key issues were: (1) whether the orders should be set aside because the application should not have been brought ex parte; (2) whether the orders should be set aside because the applicants failed to fully disclose all material facts or misled the court about the applicable law; and (3) whether the court is deprived of the ability to set aside the orders because of the Iron Ore Processing (Mineralogy Pty Ltd) Agreement Amendment Act 2020 (WA) (“the 2020 Amendments”).

In the result, WA succeeded in having the orders set aside as a result of issues (1) and (2). The 2020 Amendments (per issue (3)) did not deprive the Court of the ability to set aside the orders.

Issue 1 – whether the ex parte hearing should result in the orders being set aside

Rule 27 of the UCPR sets out the circumstances in which an application may be heard ex parte. [21]. However, at the hearing on the 13th of August 2020, the applicants had not focused on r 27, and instead had suggested that it was common for such an application to be made ex parte; that this approach had been accepted in Australia; and that it was the “orthodox approach” to proceed in two stages, with the first stage being ex parte. The only other reason advanced for proceeding ex parte was that there were “urgent, unprecedented circumstances” justifying it. [27].

After a review of the authorities, Martin J observed that the submissions that proceeding ex parte was common, orthodox or accepted, were not correct. [46]–[47]. In any event, the only identified basis on which the applicants had relied, which could be supported by r 27, was that there were “urgent, unprecedented circumstances” – being the imminent passage of legislation in Western Australia that would “render nugatory any accrued rights” under the arbitral awards. [34], [57]. However, Martin J considered that, on the facts, “there was nothing to support the argument”. [58]. His Honour continued (at [59]):

“This was not a case in which a bulldozer was rumbling, its blade raised, ready to destroy some structure. There was no evidence to support a contention that irreparable or serious mischief would have been caused had WA been served.”

In summary, the application should not have been made ex parte. That being the case, his Honour next considered whether the orders made at the hearing should be set aside. In that regard, his Honour cited numerous authorities to the effect that a “failure to provide an opportunity to be heard gives the party denied that right an entitlement, ex debito justitiae [as of right], to have the order made set aside” (per Williams JA in Greig v Stramit Corporation Pty Ltd [2000] 1 Qd R 626). [72]. Accordingly, the orders should be set aside, even if “there was nothing which WA could have legitimately put before the Court … which would have altered the outcome of the application”. [75]. 

Issue 2 – whether non-disclosure / misleading submissions should result in the orders being set aside

In case he was wrong on the first issue, his Honour said he would also consider whether the orders should be set aside on the basis that the applicants had not-disclosed material facts, or had misled the court about the applicable law. [76].

His Honour observed that advocates who appear on ex parte applications are “required to discharge well-known and onerous duties”. [77]. His Honour considered that there had been a number of failures by the applicants to acquit these duties, albeit inadvertently. [85]. In particular, his Honour considered that there has been inadequate disclosure about the extent of compliance with the 2014 award and whether there was anything left to enforce from it (which there was not); about the availability of an ex parte hearing (as discussed in relation to Issue 1 above); and about the enforceability of declaratory awards (with the relevant case law suggesting there were “issues which should have been raised but which were not”). [96], [103], [111], [123].

Numerous authorities indicated that the above duties had to be complied with “on pain of a penalty that the order will be set aside” (per Gillard AJA in Savcor Pty Ltd v Cathodic Protection International APS (2005) 12 VR 639). [86]. As Applegarth J had summarised in Heartwood Architectural Timber & Joinery Pty Ltd v Redchip Lawyers [2009] 2 Qd R 499 (quoted at [89]):

“An ex parte order that is obtained in breach of the duty of disclosure is liable to be discharged without a hearing on the merits. The respondent is prima facie entitled to its discharge. An applicant can apply for a new order.”

Accordingly, in addition to the reasons given in relation to issue (1), WA was entitled to have the enforcement orders set aside due to the failure by the applicants to acquit their duties at the ex parte hearing. [125].

Issue 3 – whether the 2020 Amendments deprived the Court of power to set aside the orders

The applicants contended that the Court should proceed on the assumption that the 2020 Amendments were constitutionally valid (a matter on which they sought special leave to argue the contrary in the High Court). [134]. On that assumption, they suggested that the 2020 Amendments had the effect of extinguishing the orders previously made by the court, such that they could not be set aside. [137].

Martin J rejected this argument. His Honour considered that “the law is clear” that an order of a superior court is valid until it is set aside (citing, e.g. National Australia Bank Ltd v Juric [2001] VSC 375). [141]. Accordingly, the orders remained effective, even if the 2020 Amendments were valid. [142]. Further, in any event, “it remains the case that a jurisdiction to set aside its orders is inherent in every court unless displaced by statute”. [142].

Accordingly, the 2020 Amendments provided no reason for the court to abstain from setting aside the enforcement orders. [143].

W Isdale

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