Sanda v PTTEP Australasia (Ashmore Cartier) Pty Ltd (No 6) [2019] FCA 1853

FEDERAL COURT OF AUSTRALIA

Sanda v PTTEP Australasia (Ashmore Cartier) Pty Ltd (No 6) [2019] FCA 1853 File number: NSD 1245 of 2016

Judge: YATES J

Date of judgment: 12 November 2019

Catchwords: EVIDENCE – rulings on evidence

Legislation: Evidence Act 1995 (Cth), ss 78, 79, 135, 136, 190(3), 190(4)

Date of hearing: 28 May 2019

Registry: New South Wales

Division: General Division

National Practice Area: Commercial and Corporations

Sub-area: Corporations and Corporate Insolvency

Category: Catchwords

Number of paragraphs: 26

Counsel for the Applicant: Mr J Sexton SC with Ms V Bosnjak and Ms Z Hillman

Solicitor for the Applicant: Maurice Blackburn

Counsel for the Respondent: Mr C Scerri QC with Mr J Arnott and Mr A Barraclough

Solicitor for the Respondent: Allens

ORDERS NSD 1245 of 2016

BETWEEN: DANIEL ARISTABULUS SANDA Applicant

AND: PTTEP AUSTRALASIA (ASHMORE CARTIER) PTY LTD (ACN 004 210 164) Respondent

JUDGE: YATES J DATE OF ORDER: 12 NOVEMBER 2019

THE COURT RULES THAT:

1. The report of Iain Charles Neish dated 25 October 2018 be admitted into evidence subject to the rulings made in these reasons. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

YATES J:

Introduction 1 Objection has been taken to the report of Iain Charles Neish dated 25 October 2018. This is a lengthy report dealing with a number of topics related to what can be described broadly as the seaweed industry in Indonesia. 2 The topics covered by the report include: (a) an overview of the history of seaweed farming in Indonesia to "the present-day" (25 October 2018), by reference to the geographical, environmental, social and economic factors within Indonesia that impact on the development and expansion of that industry; (b) the socio-economic significance of seaweed farming in coastal communities in Indonesia, with particular reference to the Kupang-Rote region with which this case is concerned; (c) the basics of tropical seaweed agronomy; (d) eucheumatoid seaweed farm management, costs and returns; (e) the processing of carrageenan seaweeds; (f) the geographic context of seaweed farming in Kupang-Rote, including factors that distinguish this region from other seaweed growing regions in Indonesia; (g) evidence that seaweed crop failures occurred in the Kupang-Rote region at the time of the Montara oil spill, and in subsequent years; (h) non-petroleum environmental factors that may have impacted Kupang-Rote seaweed production at the time of the Montara oil spill, and in subsequent years; (i) market factors that may have impacted Kupang-Rote seaweed production at the time of the Montara oil spill, and during subsequent years; and (j) a possible scenario of the Kupang-Rote seaweed industry absent crop failures that took place in 2009. 3 As will be apparent, some of these topics are directed to seaweed crop failures that occurred in the Kupang-Rote region at around the time of the Montara oil spill. However, the report does not seek to express an opinion on a causal relationship between those failures and the oil spill. One section of the report—dealing with the evidence of petroleum-related materials reaching the Kupang-Rote region at the time of the Montara oil spill—was not tendered. Certain other paragraphs, or parts of other paragraphs, of the report were also not tendered or their rejection was agreed to. 4 As a general observation, Dr Neish is well-qualified to give expert evidence in respect of the topics I have listed. He is a marine biologist and businessman who has worked with seaweeds, seaweed farmers and aquaculture systems since 1965. 5 Dr Neish commenced participation in the seaweed industry in 1965, when he undertook seaweed surveys and conducted research projects with the Nova Scotia Research Foundation Seaweeds Division. That work was done at the time he was completing an Honours degree (First Class with University Medal in Biology) at Dalhousie University in Halifax, Nova Scotia, Canada from 1963 to 1967. He completed his PhD in Zoology at the University of British Columbia, Vancouver, Canada in 1970. During that time he developed skills in computer modelling of energy and material flows through ecosystems. Models initiated during that time were later applied by him to diagnostic analyses of seaweed value chains and the development of seaweed aquaculture agronomy systems. 6 In 1970, Dr Neish co-founded Atlantic Mariculture Ltd, which produced seaweeds as sea vegetables, and Applied Marine Research Ltd, which undertook seaweed industry-related contract work at several locations around the world. 7 Dr Neish first came to Indonesia in connection with the seaweed industry when he participated in surveys of natural seaweed stocks in East Indonesia during the (vessel) "TrueBlue" survey of 1974. The surveys were conducted by a partnership (comprising the three major carrageenan manufacturers at the time) called Ocean Resources Development Association. From that time, Dr Neish's focus shifted primarily to Southeast Asia. 8 In 1977, Dr Neish undertook management functions in seaweed farm-development projects and factory installations in the Philippines, Malaysia and Indonesia. For more than 20 years he was a Project Manager for Marine Colloids Inc (later FMC Corporation and then Dow-Dupont). From 2003 to 2008, he was part of the team that developed the Seaplant.net initiative of the World Bank IFC-PENSA and PEP Philippines programmes. Since the end of those programmes in 2008, he has devoted his time to projects with GTZ, USAID, AusAID, FAO, ILO and UNIDO, and several private companies. During those projects, he participated in surveys and value chain analyses that included engagement with hundreds of active seaweed farmers in Indonesia and other countries. The results of his work have been published. He is also the co-author and co-editor of books on the commercial development of eucheumatoid seaweed farming and the development of eucheumatoid seaweed value chains. 9 Dr Neish became heavily involved with the development of seaweed cultivation in Indonesia when he managed Indonesian farm-development and seaweed-purchasing projects by FMC Corporation between 1986 and 1999. Currently, he is a Research and Development Adviser to PT Sumber Tanaman Samundra, which is an Indonesian seaweed farming company. He is also a Director of PT Sea Six Energy Indonesia, a seaweed processing company. The systems used by the latter company were initially developed in India. Full-scale development is now being undertaken in Bali, where Dr Neish now lives. 10 As Dr Neish put it in his report: I have not spent 53 years working with seaweed for the sake of seaweed. From a commercial standpoint I see seaweed as a way of making money from sun + seawater + human effort. I seldom work directly with seaweed; I work with people who are engaged in seaweed-based value chains. In tropical regions such as Kupang-Rote, the foundation link of those value chains is community enterprises (for example, seaweed farms and post-harvest treatment facilities) located in "productive ecoscapes". 11 One of the sources from which Dr Neish drew in preparing his report is another report dated 5 February 2018 entitled Farm practices in areas that experienced seaweed crop failures at the time of the 2009 Montara incident: from interviews conducted during December 2017 and January 2018 with seaweed farmers in Kupang and Rote Ndao regencies of Nusa Tengarra Province in eastern Indonesia (the February 2018 report). The February 2018 report was prepared by Dr Neish in collaboration with Mr Boedi Sardjana Julianto. According to Dr Neish, Mr Julianto has had extensive experience in interviewing farmers and developing and conducting farm training programmes with organisations that include OXFAM, UNIDO, CIDA USAID and AusAID. 12 The February 2018 report is based, in part, on field surveys and structured interviews conducted with seaweed farmers who lived in or near 81 villages in the Kupang and Rote Ndao regencies of Nusa Tengarra Timur. It is characterised by Dr Neish as a timeline of events based on those seaweed farmers' stated recollections of their seaweed farming experiences before, during and after the time of the Montara oil spill. It includes reference to other cited source materials. The report was commissioned by the applicant's solicitors.