Supreme Court New South Wales Medium Neutral Citation: R v Macdonald; R v Maitland (No 10 – verdict) [2022] NSWSC 1765 Hearing dates: 7-9, 12, 14-15, 19-20, 21, 27-28 September 2022 1, 4-7, 10-13, 17, 20, 25 October 2022, 7 November 2022 and 9 November 2022 Date of orders: 20 December 2022 Decision date: 20 December 2022 Jurisdiction: Common Law - Criminal Before: Dhanji J Decision: Ian Michael Macdonald is found guilty of counts 1 and 3 of wilful misconduct in public office. A conviction is to be entered accordingly. John William Maitland is found not guilty of counts 2 and 4 of accessory before the fact to Mr Macdonald's offences in counts 1 and 3 respectively. He is to be discharged on the indictment. Catchwords: CRIME – trial – judge alone – wilful misconduct in public office – reasons for verdict – re-trial – grant of consent to apply for exploration licence – grant of exploration licence – circumstantial case – Labor Party – impending retirement – Noble House meeting – successful pre-selection – issue of friendship – motivation – coal allocation guidelines – Prime Restaurant meeting – Strangers' Dining Room meeting – Nippon Club meeting – signing at the Catalina Restaurant – failure to seek advice from relevant bodies – challenging financial environment – consciousness of guilt evidence – improper purpose – driving force – misconduct established – verdict of guilty CRIME – trial – judge alone – accessory before the fact to wilful misconduct in public office – mining industry – direct allocation of a commercially valuable resource sought – whether the accused intended the minister to misconduct himself in granting the exploration licence – issue of friendship – benefits of training mine – long standing commitment to health and safety – "too good to be honest" – knowledge of probity issues – strategy allegedly devised at Prime Restaurant – motives – accused's state of mind – obligations as a director – lobbying – verdict of not guilty – acquittal Legislation Cited: Coal Industry Act 2001 (NSW) Coal Mine Health and Safety Act 2002 (NSW) Criminal Procedure Act 1986 (NSW), ss 132, 133 Evidence Act 1995 (NSW), s 69(2) Independent Commission Against Corruption Act 1988 (NSW), s 87 Mining Act 1992 (NSW), s 13(4) Protection of the Environment Operations Act 1997 (NSW) Cases Cited: Edwards v The Queen (1993) 178 CLR 193; [1993] HCA 63 Fox v Percy (2003) 214 CLR 118; [2003] HCA 22 Hofer v The Queen (2021) 95 ALJR 937; [2021] HCA 36 M v The Queen (1994) 181 CLR 487; [1994] HCA 63 Maitland v R; Macdonald v R (2019) 99 NSWLR 376; [2019] NSWCCA 32 Orreal v The Queen (2021) 96 ALJR 78; [2021] HCA 44 R v Janceski (2005) 64 NSWLR 10; [2005] NSWCCA 281 R v Macdonald; R v Maitland (No 2) [2022] NSWSC 1208 R v Macdonald; R v Maitland (No 8) [2022] NSWSC 1421 Stephens v The Queen (2022) 96 ALJR 871; [2022] HCA 31 Weiss v The Queen (2005) 224 CLR 300; [2005] HCA 81 Texts Cited: New South Wales Government Gazette, No 101, 10 August 2005, at 4302. New South Wales Government Gazette, No 182, 14 December 2007, at 9633 Category: Principal judgment Parties: Rex (Crown) Ian Michael Macdonald (Accused) John William Maitland (Accused) Representation: Counsel: P Hogan (Crown) R Rajalingam (Macdonald) Solicitors: Solicitor for Public Prosecutions (NSW) (Crown) Michael Bowe Solicitors (Macdonald) J W Maitland (self-represented) Ms M Cunneen SC and L Dive (amicus curiae on 4 October 2022) (Maitland) File Number(s): 2015/59990; 2015/59940 Publication restriction: Nil contents 1. The Charges - paragraph 1 2. Some preliminary matters 2.1 The first trial - paragraph 4 2.2 Trial by judge alone - paragraph 6 2.3 Joint trial of multiple charges - paragraph 9 3. The elements of the offences - paragraph 11 3.1 The elements – Mr Macdonald – the alleged principal offender - paragraph 12 3.2 The elements – Mr Maitland – an alleged accessory to Mr Macdonald - paragraph 13 3.3 The elements in dispute - paragraph 15 4. The Crown case 4.1 A brief overview of the Crown case - paragraph 16 4.2 The evidence in the Crown case - paragraph 22 4.3 A brief summary of the evidence given by each witness - paragraph 30 Mr Luke Foley - paragraph 31 Mr George Campbell - paragraph 33 Mr Paul Bastian - paragraph 34 Ms Karen Smith - paragraph 35 Mr Morris Iemma - paragraph 36 Mr Michael Costa - paragraph 38 Mr Anthony Albanese - paragraph 40 Mr Douglas Cameron - paragraph 42 Mr Brad Mullard - paragraph 44 Mr Alan Coutts - paragraph 46 Dr Richard Sheldrake - paragraph 48 Ms Patricia Madden - paragraph 49 Ms Julie Moloney - paragraph 51 Mr Anthony Hewson - paragraph 53 Ms Sue-Ern Tan - paragraph 55 Mr Jamie Gibson - paragraph 56 Mr Brendan McPherson - paragraph 57 Mr Nathan Rees - paragraph 59 Mr Michael Buffier - paragraph 61 Mr Nicholas Papallo AO - paragraph 63 Mr Richard Jones - paragraph 65 Mr Paul Healey - paragraph 67 Mr Jason Bartlett - paragraph 69 Mr Archibald Tudehope - paragraph 71 Ms Lyndall Hilder - paragraph 73 Mr James Chisholm - paragraph 75 Mr Peter Coates - paragraph 77 Mr Anthony Maher - paragraph 79 Dr Nicole Williams - paragraph 81 Mr Lawrence Ireland - paragraph 83 Mr Robert Cameron - paragraph 86 Mr Ian Macdonald - paragraph 88 5. The evidence called by Mr Macdonald - paragraph 93 5.1 Mr John Della Bosca - paragraph 95 5.2 Mr Maitland's evidence and evidence called by him - paragraph 97 5.3 Some directions with respect to Mr Macdonald's case - paragraph 98 6. The evidence called by Mr John Maitland - paragraph 101 6.1 Mr Maitland's evidence - paragraph 102 6.2 Mr Glen Lewis' evidence - paragraph 105 6.3 Mr Andrew Poole's evidence - paragraph 107 6.4 Some directions with respect to Mr Maitland's case - paragraph 109 7. The case in detail: Part 1 – The Crown's alleged motive and the accused's asserted motivations 7.1 The Crown's alleged motive 7.1.1 The significance of motive - paragraph 113 7.1.2 Mr Macdonald's political position – the Noble House meeting - paragraph 114 Mr Luke Foley - paragraph 117 Mr George Campbell - paragraph 126 Mr Paul Bastian - paragraph 128 Mr Anthony Albanese - paragraph 129 Mr Douglas Cameron - paragraph 132 Mr John Della Bosca - paragraph 135 Mr John Maitland - paragraph 137 The outcome of the Noble House meeting - paragraph 138 7.1.3 The political relationship between the accused - paragraph 139 7.1.4 A friendship between the accused? - paragraph 141 7.1.5 Conclusion as to motive - paragraph 151 7.2 The motivations of the accused - paragraph 156 7.2.1 Mr Maitland's motivations - paragraph 157 7.2.2 Mr Macdonald's motivations - paragraph 167 8. The case in detail: Part 2 – Mr Macdonald - his role, responsibilities, and the allocation of coal - paragraph 174 8.1 Mr Macdonald, his position and ministerial responsibilities - paragraph 175 8.2 The decision to grant consent to apply 8.2.1 The decision - paragraph 179 8.2.2 The significance of a decision to grant consent to apply - paragraph 182 8.3 The coal allocation committee and the guidelines 8.3.1 An overview of the allocation of coal resources - paragraph 185 8.3.2 The guidelines - paragraph 194 8.3.3 Other areas allocated by direct allocation - paragraph 201 8.4 An overview of relevant administrative and advisory bodies - paragraph 209 9. The case in detail: Part 3 – The context surrounding the grant of consent - paragraph 217 9.1 The State's financial position - paragraph 218 9.2 Caroona and Watermark - paragraph 223 9.2.1 The significance of the Caroona and Watermark bids - paragraph 232 9.3 Interest in coal mining in the Jerrys Plains area - paragraph 246 9.3.1 Independent Coal Pty Ltd - paragraph 247 9.3.2 Excel/Peabody - paragraph 248 9.3.3 Simatar Resources Pty Ltd - paragraph 249 9.3.4 Bayswater Colliery - paragraph 250 9.3.5 Atlas Coal Enterprises Pty Ltd - paragraph 251 10. The case in detail: Part 4 – The process leading to the application for consent - paragraph 257 10.1 Mr Maitland's appointment to the Coal Competence Board - paragraph 258 10.2 The meeting of 19 January 2007 - paragraph 259 10.3 Mr Maitland's "briefing note" of 22 January and the ResCo application of 15 February 2007 [280] - paragraph 263 10.4 The Department's briefing note of 22 February 2007 - paragraph 279 10.5 The meeting of 8 March 2007 - paragraph 290 10.6 Post-election and the Prime Restaurant meeting - paragraph 297 10.6 The Department's briefing note of 14 August 2007 - paragraph 307 10.7 Letters of support in August and September 2007 - paragraph 313 11. The case in detail: Part 5 – DCM's Submission of 18 March 2008 (the second application with more detail), the response to the submission and its approval 11.1 The submission - paragraph 335 11.2 The Department's briefing note of 13 May 2008 - paragraph 346 11.3 Events following the briefing note - paragraph 347 11.4 The issues in the briefing note and Mr Macdonald's response 11.4.1 Dot points 1, 6 and 9 – the size of the mine - paragraph 349 11.4.2 The size of the training component based on the number of trainees - paragraph 360 11.4.3 The other dot points - paragraph 366 11.4.3 Discussions with the Department following the briefing note - paragraph 372 11.4.4 Strangers' Dining Room meeting with Mr Maitland and Mr Ransley on 17 June 2008 following the Department's advice - paragraph 377 11.5 Gathering support 11.5.1 Events immediately following the Strangers' Dining Room meeting - paragraph 380 11.5.2 The letters - paragraph 383 11.5.3 Seeking support of the NSW Minerals Council - paragraph 386 11.5.4 Conclusion with respect to the process of obtaining support - paragraph 395 11.6 Release of other areas - paragraph 397 11.7 A failure to refer to advisory organisations or Cabinet? - paragraph 406 11.7.1 Mine Safety Advisory Council - paragraph 407 11.7.2 Minerals Ministerial Advisory Council - paragraph 414 11.7.3 Coal Services - paragraph 419 11.7.4 Cabinet - paragraph 420 11.8 The grant of the consent 11.8.1 Mr Macdonald's decision - paragraph 425 11.8.2 The meeting of 14 August and other events preceding the letter - paragraph 427 11.8.3 The terms of the letter - paragraph 440 11.8.4 Conclusions to be drawn from the drafting of the letter - paragraph 443 11.9 Events immediately following the grant of consent to apply on 21 August 2008 - paragraph 449 12. The case in detail: Part 6 – The application for and granting of the exploration licence and the events following 12.1 The application - paragraph 452 12.2 Drafting conditions - paragraph 460 12.3 Nippon Club meeting on 25 November 2008 - paragraph 462 12.4 Catalina Restaurant: the signing of the exploration licence on 15 December 2008 - paragraph 467 12.5 The Doyles Creek media release - paragraph 479 12.6 Post allegation events 12.6.1 An alleged lie to Mr Rees - paragraph 486 12.6.2 Correspondence from the Department in relation to the decision - paragraph 496 12.6.3 Correspondence with Alan Jones - paragraph 497 13. Determination in relation to Mr Macdonald with respect to Count 1 13.1 Element 3 – misconduct - paragraph 503 13.1.1 A training mine may have been a good idea - paragraph 505 13.1.2 The limitations on relying on letters of support - paragraph 508 13.1.3 The value of the resource and the relative size of the training mine - paragraph 511 13.1.4 Scrutiny of the proposal - paragraph 517 13.1.5 The financial climate - paragraph 524 13.1.6 A training mine and a tender process were not mutually exclusive - paragraph 527 13.1.7 Other factors - paragraph 538 13.1.8 Conclusion in relation to proof of misconduct by Mr Macdonald in granting DCM consent to apply for an exploration licence on or about 21 August 2008 - paragraph 539 13.2 Other elements 13.2.1 Elements 1-4 - paragraph 544 13.2.2 Element 5 – reasonable cause or justification - paragraph 546 13.2.3 Element 6 – the conduct was serious and merits criminal punishment - paragraph 550 13.3 Conclusion – Count 1 - paragraph 553 14. Determination in relation to Mr Macdonald with respect to count 3 14.1 Misconduct with respect to Count 3 - paragraph 554 14.2 Other elements 14.2.1 Elements 1-4 - paragraph 562 14.2.2 Element 5 – reasonable cause or justification - paragraph 564 14.2.3 Element 6 – the conduct was serious and merits criminal punishment - paragraph 566 14.3 Conclusion – Count 3 - paragraph 567 15. Determination in relation to Mr Maitland 15.1 Consideration of the case against Mr Maitland - paragraph 568 15.2 Count 2: Element 1 in the case against Mr Maitland – proof that Mr Macdonald committed the offence - paragraph 570 15.3 Count 2: Element 2, elements 3(b) and (c), elements 4(a), (b), (c), (e) and (f), and element 5 - paragraph 574 15.4 The real issue – Mr Maitland's state of mind in relation to Mr Macdonald's misconduct (element 3(a) and element 4(d)) - paragraph 580 15.5 The process leading up to the March 2008 submission from Mr Maitland's perspective 15.5.1 The meeting of 15 January 2007 - paragraph 585 15.5.2 The meeting of 8 March 2007 between Mr Maitland, Mr Hewson and Ms Tan and the "potential probity issues" - paragraph 597 15.5.3 ResCo Board meeting on 3 April 2007 - paragraph 604 15.5.4 The CFMEU's position - paragraph 608 15.5.5 Prime Restaurant meeting on 26 July 2007 , "the strategy" and the process leading to the submission made on 18 March 2008 - paragraph 609 15.5.6 The submission of 18 March 2008 - paragraph 628 15.6 Events following the lodging of the submission relevant only to Mr Maitland - paragraph 632 15.6.1 Letter to the Taiwan Power Corporation - paragraph 633 15.6.2 Media articles - paragraph 634 15.6.3 The Department's Briefing Note of 13 May 2008 - paragraph 637 15.6.4 Seeking support and the approach to the NSW Minerals Council - paragraph 639 15.6.5 The grant of consent to apply - paragraph 645 15.7 Mr Maitland's attempts to sell a share of DCM based on the exploration licence and the Crown case that he believed he had been "gifted" something of significant value 15.7.1 Mr Maitland's emails placing a value on the exploration licence - paragraph 647 15.7.2 Mr Maitland's answer to the valuation emails – business "teasers" and other things - paragraph 656 15.7.3 The value of Mr Maitland's shareholdings in DCM and opportunities to obtain additional shares - paragraph 661 15.7.4 Mr Maitland's knowledge of the Department's recommendations and the potential AFC forgone - paragraph 670 15.7.5 Conclusion as to Mr Maitland's belief he had been gifted something of value - paragraph 671 15.8 Obtaining evidence of support to fulfil the conditions on the grant of consent - paragraph 676 15.8.1 Obtaining community support - paragraph 677 15.8.2 Obtaining evidence of industry support - paragraph 681 15.8.3 Conclusion in relation to satisfaction of the conditions on the grant of consent - paragraph 682 15.9 The application for and granting of the exploration licence - paragraph 687 15.10 Conclusion in relation to count 2 against Mr Maitland - paragraph 690 15.11 Conclusion with respect to count 4 against Mr Maitland - paragraph 700 Orders - paragraph 704 JUDGMENT 1. The Charges 1. HIS HONOUR: Ian Michael Macdonald stands charged on an indictment with two counts of wilful misconduct in public office as follows: "Count 1: On or about 21 August 2008 in Sydney in the State of New South Wales, then holding public office as Minister for Mineral Resources did in the course of and connected to his public office wilfully misconduct himself by granting Doyles Creek Mining Pty Ltd consent to apply for an exploration licence under the Mining Act 1992, without reasonable cause or justification, where such misconduct is serious and meriting criminal punishment having regard to the responsibilities of the office and the officeholder, the importance of the public objects which they serve and the nature and extent of the departure from those objects. Count 3: On or about 15 December 2008 in Sydney in the State of New South Wales, then holding public office as Minister for Mineral Resources did in the course of and connected to his public office wilfully misconduct himself by granting to Doyles Creek Mining Pty Ltd Exploration Licence No. 7270 under the Mining Act 1992, without reasonable cause or justification, where such misconduct is serious and meriting criminal punishment having regard to the responsibilities of the office and the officeholder, the importance of the public objects which they serve and the nature and extent of the departure from those objects." 1. John William Maitland stands charged on the same indictment with two counts of being an accessory before the fact to the two principal offences with which Mr Macdonald is charged, as follows: "Count 2: Whereas on or about 21 August 2008 in Sydney in the State of New South Wales Ian Michael Macdonald then holding public office as Minister for Mineral Resources did in the course of and connected to his public office wilfully misconduct himself by granting Doyles Creek Mining Pty Ltd consent to apply for an exploration licence under the Mining Act 1992, without reasonable cause or justification, where such misconduct is serious and meriting criminal punishment having regard to the responsibilities of the office and the officeholder, the importance of the public objects which they serve and the nature and extent of the departure from those objects. AND THAT: Between 17 January 2007 and 22 August 2008 in Sydney and elsewhere in the State of New South Wales did beforehand, aid, abet, counsel and procure the commission of the said offence. Count 4: Whereas on or about 15 December 2008 in Sydney in the State of New South Wales Ian Michael Macdonald then holding public office as Minister for Mineral Resources did in the course of and connected to his public office wilfully misconduct himself by granting to Doyles Creek Mining Pty Ltd Exploration Licence No. 7270 under the Mining Act 1992, without reasonable cause or justification, where such misconduct is serious and meriting criminal punishment having regard to the responsibilities of the office and the officeholder, the importance of the public objects which they serve and the nature and extent of the departure from those objects. AND THAT Between 21 August 2008 and 16 December 2008 in Sydney and elsewhere in the State of New South Wales did beforehand, aid, abet, counsel and procure the commission of the said offence." 1. It is, accordingly, for the prosecution to prove counts 1 and 3 against the accused Mr Macdonald and counts 2 and 4 against the accused Mr Maitland. That onus remains on the Crown throughout. The accused are presumed to be innocent of each offence unless and until the Crown has proved his guilt of the particular offence beyond reasonable doubt. To prove the guilt of either of the accused with respect to either of the offences against him, the Crown must prove beyond reasonable doubt that he committed that offence. 2. Some preliminary matters 2.1 The first trial 1. The accused were the subject of an earlier trial, presided over by Adamson J with a jury, on the same indictment. There is no issue with the retrial before me taking place on that same indictment: see R v Janceski (2005) 64 NSWLR 10; [2005] NSWCCA 281 per Howie J at [221]. A number of pre-trial orders were made, the jurisdiction of the Court having been established by the earlier arraignment of the accused on the indictment. While not strictly necessary for the purposes of jurisdiction, the accused were re-arraigned before me on 7 September 2022 to mark the formal start of the trial before me: see Stephens v The Queen (2022) 96 ALJR 871; [2022] HCA 31 per Steward J at [54]. At this trial, Mr Macdonald has been represented by Mr Rajalingam of counsel. Mr Maitland appeared for himself. 2. The above history of the proceedings is not relevant to my decision. My decision will be made only on the evidence led at the trial before me. Reference to the history is, however, unavoidable, having regard to the date of the indictment, the nature of the evidence led at this trial (which included significant quantities of transcript from the earlier trial), and the principles of law enunciated in the appeal proceedings in Maitland v R; Macdonald v R (2019) 99 NSWLR 376; [2019] NSWCCA 32 which led to this retrial. I stress that that decision is not relevant other than to the extent that it decided principles of law (binding on me) to be applied in this case. I note that I have, in any event, had access only to the currently unrestricted form of that judgment. 2.2 Trial by judge alone 1. On 18 August 2022, I made an order pursuant to s 132 of the Criminal Procedure Act 1986 (NSW), that the accused be tried by Judge alone: R v Macdonald; R v Maitland (No 2) [2022] NSWSC 1208. Section 133(1) provides that my verdict will have the same effect as a jury verdict and that I may make any finding that could be made by a jury. Section 133(2) mandates that I record the relevant principles of law and the findings of fact on which I rely. Section 133(3) provides that I must take into account any warning that would be given to a jury. 2. The overriding legal principle by which this judgment is guided is that the prosecution must prove the guilt of the accused and must do so beyond reasonable doubt. While it is not required to prove each disputed fact to that standard, it must prove the essential elements of any particular charge, beyond reasonable doubt, before a verdict of guilty can be returned in respect of that charge. If there is any reasonable doubt in relation to any element, I must find the particular accused to which it relates not guilty. The words "beyond reasonable doubt" are ordinary words and need no further elaboration. It is a very high standard of proof and is to be distinguished from suspicion, however grave, and proof on the balance of probabilities. 3. Where, as here, the prosecution relies on the drawing of inferences to establish an element, the Crown must prove that the conclusion required by the element is the only reasonable inference to be drawn. It follows that the Crown must exclude any alternative inference that is inconsistent with guilt. Where, in order to prove an element, the Crown relies on inferential reasoning to establish some intermediate fact, while that intermediate fact may not need to be proved beyond reasonable doubt, I remind myself of the care to be taken in the drawing of inferences to find any such fact. 2.3 Joint trial of multiple charges 1. Mr Macdonald and Mr Maitland are being tried together as a matter of convenience. I must, of course, give separate consideration to the case against each accused, and make my determination based only on the evidence admissible against that accused. Similarly, each charge against each accused must be separately considered having regard to the evidence relevant to that charge. 2. In this context, I note that each accused led evidence in his own case. While the trial of each accused remains separate in the sense referred to above, the evidence led by each accused is generally admissible with respect to both accused. That is, the evidence is admissible subject to any specific basis on which particular evidence, admissible in the case of one accused, is not admissible in the case of the other. 3. The elements of the offences 1. The elements of the offences are, in accordance with the Court of Criminal Appeal's judgment in Maitland v R; Macdonald v R (2019) 99 NSWLR 376; [2019] NSWCCA 32 and my reasons in R v Macdonald; R v Maitland (No 8) [2022] NSWSC 1421, as set out below. 3.1 The elements – Mr Macdonald – the alleged principal offender 1. The elements of the offences charged against Mr Macdonald are as follows (with matters particular to count 1 underlined and, to count 3, in square brackets): [1] 1. Mr Macdonald was a public official, that being the Minister for Mineral Resources. 2. In the course of, or in connection with, his public office he granted Doyles Creek Mining Pty Ltd (DCM) consent to apply for an exploration licence [Exploration Licence No. 7270] under the Mining Act 1992 (NSW). 3. In granting consent [Exploration Licence No. 7270], Mr Macdonald misconducted himself as the consent [exploration licence] was granted for the purpose of benefiting Mr Maitland and DCM in that this purpose was the driving force behind the decision such that the decision would not have been made but for this purpose. 4. Mr Macdonald's misconduct was wilful in that he knew either that: 1. he was obliged not to use his position in that way; or 2. it was possible that he was obliged not to use his position in that way but chose to do so anyway. 1. Mr Macdonald granted such consent [Exploration Licence No. 7270] without reasonable cause or justification. 2. Mr Macdonald's misconduct was serious and merits criminal punishment having regard to the responsibilities of the office and the officeholder, the importance of the public objects which they serve and the nature and extent of the departure from those objects. 3.2 The elements – Mr Maitland – an alleged accessory to Mr Macdonald 1. The elements of the offences against Mr Maitland are as follows (with matters particular to count 2 underlined and, to count 4, in square brackets): 1. Mr Macdonald committed the principal offence charged in count 1 [count 3] (in that, on the evidence admissible against Mr Maitland, each element of count 1 [count 3] against Mr Macdonald is proved). 2. Between 17 January 2007 and 22 August 2008 [between 21 August 2008 and 16 December 2008], Mr Maitland intentionally assisted and encouraged Mr Macdonald to grant DCM consent to apply for an exploration licence [an exploration licence] under the Mining Act. 3. Mr Maitland intended that Mr Macdonald, in the course of or in connection with his public office, would grant DCM consent to apply for an exploration licence [an exploration licence] in circumstances where: 1. the consent [exploration licence] was granted for the purpose of benefiting Mr Maitland and DCM, where this purpose was the driving force behind the decision such that the decision would not have been made but for this purpose; 2. Mr Macdonald knew either that he was obliged not to use his position in that way; or that it was possible that he was obliged not to use his position in that way but chose to do so anyway; and 3. Mr Macdonald did not have reasonable cause or justification. 1. At the time Mr Maitland encouraged and assisted Mr Macdonald, he knew that: 1. Mr Macdonald was a public official; 2. Mr Macdonald had the power to grant DCM consent to apply for an exploration licence [an exploration licence] under the Mining Act and that there was a real prospect that he would grant such consent [exploration licence]; 3. If Mr Macdonald granted DCM consent to apply for an exploration licence [an exploration licence] under the Mining Act he would be acting in the course of, or in connection with, his public office; 4. If Mr Macdonald granted DCM consent to apply for an exploration licence [an exploration licence] under the Mining Act, he would be misconducting himself because the consent [exploration licence] would be granted for the purpose of benefiting Mr Maitland and DCM and this purpose would be the driving force behind the decision such that the decision would not have been made but for this purpose; 5. If Mr Macdonald granted DCM consent to apply for an exploration licence [an exploration licence] under the Mining Act his misconduct would be wilful because Mr Macdonald knew either that: 1. he was obliged not to use his position in that way; or 2. it was possible that he was obliged not to use his position in that way but chose to do so anyway. 1. If Mr Macdonald granted such consent [licence] it would be without reasonable cause or justification. 1. The facts of which Mr Maitland was aware were sufficient to result in Mr Macdonald's conduct being serious and meriting criminal punishment having regard to the responsibilities of the office and the officeholder, the importance of the public objects which they serve and the nature and extent of the departure from those objects. 1. With respect to element 1, above, it is unnecessary to repeat the elements as set out with respect to Mr Macdonald. 3.3 The elements in dispute 1. While it is necessary that I be satisfied of every element, there was no issue that Mr Macdonald granted DCM consent to apply for an exploration licence (count 1) and subsequently granted an exploration licence (count 3) and that he did so in the course of his public office. There is also no issue that Mr Macdonald knew he was obliged not to use his position to favour Mr Maitland, and thus, if he did so his conduct was wilful. While it was submitted that if Mr Macdonald misconducted himself he had reasonable cause or justification, and that further, any such misconduct was not sufficiently serious to be criminal, the central issue was whether Mr Macdonald engaged in misconduct. In relation to Mr Maitland, it was firstly in issue as to whether it was proved against him that Mr Macdonald engaged in misconduct. If so, it was in issue as to whether it was proved that he was aware of Mr Macdonald's misconduct and intended that Mr Macdonald engage in misconduct. 4. The Crown case 4.1 A brief overview of the Crown case 1. It is convenient at this stage to provide an overview of the Crown case in very brief terms. As is apparent from the indictment, it is alleged that Mr Macdonald, on two occasions, misconducted himself in public office. That office was his position as the Minister for Mineral Resources in the State Labor government, a position he had held since 3 August 2005. In that position he was responsible for the State's mineral resources, including coal. He was, additionally, a member of the Cabinet. The Department of Primary Industries ("the Department" or "the DPI") was responsible for administering the sector in accordance with government policy, advising the Minister and implementing his decisions. A mining company seeking to establish a coal mine in a particular area would first need an exploration licence for that area. At the time, an application for an exploration licence could not be made unless the Minister had first granted consent to apply. Mr Macdonald, as the Minister, had the power to grant an applicant consent to apply for an exploration licence and the power to grant the exploration licence. In reality, the grant of consent to apply was the most significant step in establishing a coal mine. If granted, the expectation was that the exploration licence would be granted, and subsequent to that (assuming the exploration was successful), a mining lease. The grant of the mining lease fell within the responsibilities of the Department of Planning (and a different minister). Nonetheless, at least from the perspective of the Department, it was expected that there would be coordination within the bureaucracy such that a prospective miner would not undergo the process of obtaining an exploration licence and consequent exploration, only to be denied a mining lease. 2. Mr Maitland had been, for some years, a senior union official in the mining industry, ultimately resigning in 2006 as the National Secretary of the Construction, Forestry, Mining and Energy Union (the CFMEU). As a result of their respective positions the two accused were known to each other professionally, and on the Crown case, were friends. Subsequent to Mr Maitland's retirement from the union, Mr Macdonald appointed him as chair of a body he had established called the Coal Competence Board, which was to report to Mr Macdonald as Minister. Mr Maitland also accepted a position as chair of a company, ResCo Services Pty Ltd (ResCo). ResCo's primary activity at that point was as a labour hire company providing services to the mining industry. It also provided engineering services for mine development. [2] ResCo had aspirations to engage in mining and identified an area of land at Doyles Creek in Hunter Valley, nearby to a township called Jerrys Plains. A plan was arrived at to seek access to the area in order to establish a commercial mine together with a training mine. Mr Maitland had long had an interest in establishing an underground training mine based on a genuine belief such training would enhance safety in the industry. The training mine was also to be promoted on the basis that it would address a serious skills shortage in the industry. 3. ResCo made application for consent to apply for an exploration licence for the area in February 2007 seeking what was described as a "direct allocation". At the time the Department's guidelines provided that the allocation of a "major stand-alone area", such as that sought, would be allocated by some form of competitive process such as tender or expression of interest, possibly with an "open-ended financial contribution". The tender processes in relation to applications for consent to apply in relation to some other coal resources had, around the relevant time, resulted in very substantial payments by mining companies. The benefit in the establishment of a training mine provided the basis on which it was sought to justify the allocation of the resource to ResCo. Mr Maitland's appointment to ResCo acknowledged his access to the Minister (as a result of his position on the Coal Competence Board) and it was anticipated that he would use that access to promote ResCo's application for consent to apply for an exploration licence for the area, and ultimately an exploration licence, largely based on the benefit to be obtained from a training mine. 4. The February 2007 ResCo proposal was relatively insubstantial and was not determined. In March 2007, following the State government election, the State Labor government was returned and Mr Macdonald retained his portfolio. Thereafter, the Crown alleges that Mr Maitland dealt with Mr Macdonald, through Mr Macdonald's office, but including in meetings in person (with ministerial staff present), and formulated a "strategy" which would give substance to the application and allow Mr Macdonald to approve it other than on merit. A significantly more comprehensive application for consent to apply was made on 18 March 2008 by DCM, an entity established by ResCo for that purpose. Mr Macdonald granted the application by letter dated 21 August 2008 (count 1). That allowed DCM to apply for an exploration licence which they did, after completing various formal requirements and payment of fees, on 29 September 2008. Mr Macdonald granted Exploration Licence No. 7270 on 15 December 2008 (count 3). 5. The Crown alleges Mr Macdonald misconducted himself with respect to each of those grants. Its case is essentially circumstantial, relying on various matters including what it says was a friendship between the two men, Mr Macdonald's impending retirement (and consequent motive to secure his future), that Mr Macdonald acted against his Department's advice, the value of the resource, that Mr Macdonald failed to obtain independent advice with respect to the proposal and the relative insignificance of any training mine compared to the expected commercial production of the mine. 6. It is alleged that Mr Maitland was an accessory before the fact to each of count 1 and count 3 (counts 2 and 4). The case does not require proof of an agreement as would be required, for example, in relation to a conspiracy charge, or an allegation of a joint criminal enterprise. Rather, the Crown case against Mr Maitland is that, from all the circumstances known to him, the inference would be drawn, beyond reasonable doubt, that he knew Mr Macdonald was misconducting himself on each occasion, and he intended that he would do so. 4.2 The evidence in the Crown case 1. It is not practical in these reasons to refer to all the evidence given, and exhibits tendered by or on behalf of the Crown or the accused. I have considered all the evidence. My failure to refer to some part of the evidence should not be taken to mean I have not considered it. 2. The Crown case relied on the transcripts of the evidence given by the witnesses in the first trial. These transcripts were tendered by consent, though in some cases the witness was required for further cross-examination. No additional witnesses were called by the Crown at this trial. A reference to the "evidence" given by a witness in these reasons includes evidence given by the witness in the first trial as well as evidence given before me. 3. Mr Macdonald gave evidence in his own case at the first trial. The evidence of Mr Macdonald given at that trial was tendered by the Crown in this trial. [3] The Crown relied on various representations in the evidence as admissions and thus admissible against Mr Macdonald. Mr Macdonald did not resist this but requested that the Crown tender the entirety of Mr Macdonald's evidence, which the Crown agreed to do, resulting in the entirety of the evidence being before me. In accordance with what I have said above, I will refer to the "evidence" of Mr Macdonald when referring to the transcript of his evidence in the first trial as tendered before me. 4. As a result of Mr Macdonald giving evidence in the last trial, his evidence was evidence in the trial of both accused at that trial. In the present trial, Mr Maitland, while consenting to the tender of the transcripts of evidence of the various Crown witnesses, did not consent to the tender of Mr Macdonald's evidence in the case against him. The result is that the evidence as against Mr Macdonald is hearsay and is not admissible against Mr Maitland. Further, I note, Mr Maitland expressly disavowed reliance on any parts of the evidence of Mr Macdonald. I will have no regard to the evidence of Mr Macdonald in the case against Mr Maitland. 5. The entirety of the exhibits from the first trial were also tendered at this trial. Some documentary material additional to that tendered in the first trial was also tendered before me. The principal Crown exhibit was Exhibit A, which was in the nature of a "tender bundle" with an index to all of the 2017 exhibits. Folder 1 and 2 of Exhibit A contains relevant documents in chronological order. Folder 3 of Exhibit A (Caroona and Watermark), contains documents specific to the Caroona and Watermark resource allocations. Additional to this material are Exhibits B to AF (the final two of which were additional to that tendered in the first trial). The accused at this trial adopted the same approach as had been adopted in the first trial – that is, no issue was taken as to the admissibility of the documents, or their provenance, as indicated in the index. [4] One qualification to this must be noted. The index listed, in a separate column, whether the tender was limited to only one of the accused (and where blank, the document was relied upon as admissible against both). There is no issue where the document is said to be only admissible against Mr Maitland. Those documents cannot be taken into account in the case of Mr Macdonald. The position in relation to documents marked as admissible against Mr Macdonald only was more nuanced. Because Mr Maitland's alleged liability, in each of counts 2 and 4 charged against him, is as an accessory to alleged offences committed by Mr Macdonald, each of the counts against him require proof of the commission of the principal offence by Mr Macdonald. The position ultimately taken was that the reference to a document not being admissible against Mr Maitland should be taken to be not "directly" admissible against Mr Maitland. What was meant by that was that the document could be relied upon to prove, in the case against Mr Maitland, the commission by Mr Macdonald of the offence, but otherwise had no relevance to the other elements to be proved against Mr Maitland. 6. The position taken above is generally understandable. The exhibits consist almost, if not entirely, of business records and would generally be admissible (over objection) against each accused. There are potential exceptions, such as, for example, a document not relied on as containing representations made "by a person who had or might reasonably be supposed to have had personal knowledge of [an] asserted fact", or "on the basis of information directly or indirectly supplied by a person who had or might reasonably be supposed to have had personal knowledge of [an] asserted fact". [5] An example of this might be a letter written by Mr Macdonald which is alleged to be false or misleading. While no objection was specifically taken to such documents, having regard to the fact that Mr Maitland was not represented, I do not propose to rely on documents in this category in his case. 7. Both accused tendered before me the exhibits tendered by them at the first trial. Those exhibits were added to by further exhibits that had not been tendered in the first trial. All of these exhibits were generally available in the case of each accused, although in the case of some exhibits tendered by Mr Maitland, Mr Macdonald indicated his specific reliance on the exhibit. 8. It is necessary to say something with respect to the fact that much of the evidence of witnesses, including, importantly, that of Mr Macdonald, was in the form of transcript. No submission was made as to how I should treat this evidence as compared to the evidence given before me in person. I am mindful of the "natural limitations" that exist when proceeding based on a transcript of evidence given on a previous occasion: Fox v Percy (2003) 214 CLR 118; [2003] HCA 22 at [23]; Weiss v The Queen (2005) 224 CLR 300; [2005] HCA 81 at [40]; Hofer v The Queen (2021) 95 ALJR 937; [2021] HCA 36 at [91]-[93], [133]; Orreal v The Queen (2021) 96 ALJR 78; [2021] HCA 44 at [21], [41]. Those natural limitations often mean that a jury (or a judge in a judge alone trial) will have an advantage over an appellate court in determining the matter on the record. In such a case, speaking in a criminal law context, the natural limitations have the effect of restraining the appellate court in that any doubt experienced by an appellate court will only result in a finding that a verdict is unreasonable when a doubt cannot be explained by the advantage held by the jury at first instance: M v The Queen (1994) 181 CLR 487; [1994] HCA 63, and the many cases, both preceding, and following. That is a very different situation to that which pertains here. I am hearing the matter at first instance. The Crown must persuade me beyond reasonable doubt of the guilt of the accused with respect to the charges against them. In these circumstances, and having regard to the onus of proof, it is necessary that I take care not to accept a version challenged by the accused, or reject evidence relied on by the accused where the manner in which that evidence was given may have been decisive. That, of course, is not to say that I am not required to carefully assess the evidence based on its plausibility, both inherent and in the context of all the evidence before me. Ultimately, little of the evidence in the transcript relied on by the Crown is in issue (as opposed to the inferences to be drawn from that evidence). Mr Macdonald's evidence, and its impact on the inferences to be drawn from the evidence relied on by the Crown is, of course, squarely in issue. I will deal with this issue in relation to Mr Macdonald's evidence, as relevant, in due course. 4.3 A brief summary of the evidence given by each witness 1. The witnesses in the Crown case (including those who did not give evidence before me but whose evidence from the first trial was tendered) were as follows. Mr Luke Foley 1. The transcript of the evidence of Mr Luke Foley of 7 February 2017 (from the first trial) and of 20 February 2020 (in proceedings that were not identified) was tendered. [6] Mr Foley was also called before me for further cross-examination. Mr Foley has been a member of the Australian Labor Party (ALP) since 1988 and became Assistant General Secretary of the party in about 2003. Assistant General Secretaries were "heavily involved" with managing the selection and endorsement of ALP candidates for Federal, State and Local government. [7] Mr Foley was a member of the Legislative Council from June 2010 until March 2015, when he became a member of the Legislative Assembly. He was the Leader of the Opposition when he gave evidence in February 2017. [8] 2. Mr Foley gave evidence of the circumstances surrounding Mr Macdonald's pre-selection for the Legislative Council, what was described as the Noble House meeting and the relationship between Mr Macdonald and Mr Maitland. Mr George Campbell 1. The transcript of the evidence of Mr George Campbell of 7 February 2017 was tendered. [9] Mr Campbell joined the ALP in 1966 and was National Secretary of the Australian Manufacturing Workers' Union (AMWU) from 1986 to 1996. From 1997 to 2008 he was a senator in the Federal Parliament. [10] He gave evidence of the circumstances surrounding Mr Macdonald's pre-selection for the Legislative Council, the Noble House meeting and the relationship between Mr Macdonald and Mr Maitland. Mr Paul Bastian 1. The transcript of the evidence of Mr Paul Bastian of 7 February 2017 was tendered. [11] Mr Bastian was Secretary of the NSW branch of the Metal Workers' Union (now the AMWU) from 1997 to December 2009. He then became National President of the AMWU until August 2012, when he became the National Secretary of the AMWU, which he remained when he gave his evidence in February 2017. [12] He gave evidence on the circumstances surrounding Mr Macdonald's pre-selection for the Legislative Council, the Noble House meeting and the relationship between Mr Macdonald and Mr Maitland. Ms Karen Smith 1. The transcript of the evidence of Ms Karen Smith of 7 and 8 February 2017 was tendered. [13] Ms Smith had worked as a lawyer in the Department of Premier and Cabinet since December 2010. As Deputy Secretary and General Counsel, she was responsible for the Cabinet and Legal branches of that Department, prepared commissions for Ministers and Executive Councils, and gave legal and procedural advice on Government matters, including the Ministerial Code of Conduct. [14] She gave evidence on the processes for Ministerial swearing in and the receiving of commissions, the briefing of new Ministers on Cabinet practices and procedures, the Ministerial Handbook and Code of Conduct, and other Cabinet documents and conventions. Mr Morris Iemma 1. The transcript of the evidence given by Mr Morris Iemma on 8 February 2017 was tendered. [15] He was also called in this trial. Mr Iemma was the Premier of New South Wales between August 2005 and September 2008, during which time Mr Macdonald was the Minister for Mineral Resources. He had been a member of the Legislative Assembly since 1991, as a member of the ALP. Prior to being the Premier, he had also been the Minister for Public Works and Services, Minister for Sport and Recreation, Minister for Health, Minister for Citizenship, Minister for Arts, Minister for State Development and the Treasurer for varying periods. [16] 2. Mr Iemma adopted the evidence given in the first trial and was then further cross-examined by the accused. He gave extensive evidence on Cabinet workings, including the induction of Ministers, Cabinet processes and operations, the responsibilities of different Cabinet committees, the types of matters that are brought to Cabinet, the relationship between a Minister and the Department and his understanding of briefing notes. He also gave evidence about the relationship between Mr Macdonald and Mr Maitland and the financial environment in New South Wales during his premiership. At this trial, he provided further evidence about the attributes of Mr Macdonald and his concerns about mine safety, and matters related to the underground training mine proposal. Mr Michael Costa 1. The transcript of the evidence of Mr Michael Costa of 8 February 2017 was tendered. [17] He had previously been the Secretary of the Labor Council of NSW, the NSW branch of the Australian Council of Trade Unions (ACTU) and the peak council of trade unions in New South Wales. In 2001, Mr Costa was elected as an ALP member of the NSW Legislative Council. He was part of the Right faction of the ALP. Mr Macdonald, who was a member of the Left faction, was also a member of the Legislative Council during the same period. [18] Mr Costa was the NSW Treasurer in 2006, a position he retained until 5 September 2008. [19] 2. Mr Costa gave evidence on the induction of Ministers, Cabinet processes and operations including that of the Budget Committee and Expenditure Review Committee, the types of matters that are brought to Cabinet, Coal Allocation Guidelines, and the allocation of the Caroona exploration licence. He also gave evidence on the relationship between Mr Macdonald and Mr Maitland. Mr Anthony Albanese 1. The transcript of the evidence of the current Prime Minister, Mr Anthony Albanese of 17 February 2017 and, in different proceedings on 20 February 2020, was tendered. [20] Mr Albanese joined the ALP in 1979 and has held various senior roles in the party. From 1989 to 1995 he was Assistant General Secretary of the NSW ALP. His functions in that role were two-fold. He was second in charge of the NSW ALP and Deputy Campaign Director for State and Federal elections, with responsibilities in relation to printing, "how to vote" information, some publications, international and interstate votes and election contests. He was also informal coordinator of the Left faction of the ALP (a role which falls to the Assistant Secretary while the General Secretary coordinates the majority Right faction). [21] Mr Albanese's role involved the pre-selection of candidates for elections, which involved giving support to Left candidates in lower house seats, dealing with credentialing issues and eligibility processes, and smoothing the process for Left candidates towards Senate, Upper House and other positions. [22] Mr Albanese was aligned with the Hard Left faction of the ALP, which was also known as the Metal Workers' Group and the Union's Group. [23] In March 1996, Mr Albanese became the Federal Member for Grayndler and held this position at the time of giving evidence. [24] 2. Mr Albanese gave evidence on the circumstances surrounding Mr Macdonald's pre-selection for the Legislative Council, the Noble House meeting and Mr Maitland's involvement in ALP factional politics. [25] Mr Douglas Cameron 1. The transcript of the evidence of Mr Douglas Cameron of 20 February 2017 was tendered. [26] Mr Cameron held various positions in the AMWU before becoming National Secretary (the Chief Executive Officer) of the AMWU in 1997. In June 2008 Mr Cameron became a senator of the Federal Parliament, which he remained at the time of giving his evidence in February 2017. [27] 2. Mr Cameron gave evidence about the AMWU, concerns about safety in the coal mining and underground mining industry, the relationship between Mr Macdonald and Mr Maitland, the circumstances surrounding Mr Macdonald's pre-selection for the Legislative Council and the Noble House meeting. Mr Brad Mullard 1. The transcript of the evidence of Mr Brad Mullard of 8, 9, 10, 13 and 14 February 2017 was tendered. [28] He was also called in this trial. In or before 2008, Mr Mullard was the Director of Coal and Petroleum Development within the Mineral Resources section of the DPI. He reported directly to Mr Coutts. After Mr Coutts left the Department around November 2008, Mr Mullard acted in Mr Coutts' position and later was appointed to the role of Deputy Director of Mineral Resources. He left the Department in about September 2014. [29] Mr Mullard was a member of a number of boards, including the Coal Compensation Board and the chair of the Coal Allocation Committee. [30] He was involved with the Coal Allocation Committee from around 2007, but took over the chairperson position when Mr Coutts left in November 2008. [31] 2. Mr Mullard adopted the evidence given in the first trial and was then further cross-examined by the accused. He gave evidence about government mining policies, the coal allocation process including the role of the Department's Coal Allocation Committee and the Coal Allocation Guidelines, the nature of an exploration licence and consent to apply for an exploration licence. His evidence included the payment of an additional financial contribution (AFC) in some cases. He also gave extensive evidence about the application and grant of the Doyles Creek exploration licence, including the factors that he perceived as increasing the attractiveness of the resource, previous expressions of interest in the resource, the DPI briefing notes, his conversation with Mr Macdonald about the proposal, his understanding of the "major policy difficulties" and "potential probity issues" referred to in the DPI briefing note, industry support, the estimated size and nature of the resource, the deviation from the usual process for issuing letters of consent, and about events following the grant of the exploration licence. Additionally, he gave some evidence on the industry's concern about mine safety and the need for training. At this trial, he provided further comment on the briefing notes, the possible delays involved in a competitive allocation process, the Department's focus on improving the health and safety of the mining workforce, the potential merits of the training mine proposal and the industry's concerns about union involvement. Mr Alan Coutts 1. The transcript of the evidence of Mr Alan Coutts of 14 and 15 February 2017 was tendered. [32] He was also called in this trial. Mr Coutts worked for 11 years in Mineral Resources, first as Director-General of Minister Resources, then as Deputy Director-General when the Department merged with the DPI in 2004. [33] Mr Coutts left the Department in November 2008. [34] He had regular discussions with staff at the Minister's Office, principally the minerals policy adviser (who around 2006 was Ms Sue-Ern Tan, and subsequently Mr Jamie Gibson). [35] 2. Mr Coutts adopted the evidence given in the first trial and was then further cross-examined by the accused. He gave evidence of the relationship between Mr Macdonald and Mr Maitland, the coal allocation process, the competitive allocations of the Caroona and Watermark exploration licences, the Department's budgetary concerns, considerations relating to the Jerrys Plains resource, past instances of direct allocations, and the application and grant of the Doyles Creek exploration licence, including his and the DPI's views on the proposal, the Minister's views on the proposal, industry support for training mines, his understanding of the briefing notes and the usual process for issuing letters of consent. He also gave evidence on the differences of opinion as to the seriousness of the skills shortage within the industry and the benefits of simulation training as opposed to real experience in an underground mine. In this trial, he provided further evidence about the Department's views on DCM's application, the concerns expressed in the briefing notes, the strong focus on health and safety in the mining sector, following the Gretley disaster and the inquiry by Dr James Macken AM and his views on the relevance of the probity issues after the March 2008 training mine facility submission was received. Dr Richard Sheldrake 1. The transcript of the evidence of Dr Richard Sheldrake of 15 February 2017 was tendered. [36] Dr Sheldrake was the Director-General of the DPI from January 2008 to September 2013. He gave evidence of the 11 areas released for expressions of interest in 2008, the conditions of the exploration licence provided to DCM, the DPI Briefing dated 12 December 2008 recommending the grant of the exploration licence and the events following the grant of the exploration licence to DCM. Ms Patricia Madden 1. The transcript of the evidence of Ms Patricia Madden of 16 February 2017 was tendered. [37] She was also called in this trial. Ms Madden commenced employment with the DPI in May 2005 as a Ministerial Coordinator in the Titles Branch. From May 2006 to August 2012, she was a Manager of Operations within the Mineral Resources Development Branch and worked as essentially a Staff Officer to Mr Brad Mullard, managing the office, his correspondences, briefs and meetings. [38] She would also draft briefing notes, the content of which Mr Mullard had the final say. Ms Madden worked directly outside Mr Mullard's office at Maitland. [39] 2. Ms Madden adopted her evidence given in the first trial and was then further cross-examined by the accused. She gave evidence on the Department's coal exploration program, the draft briefing note of 9 February 2007 and briefing note of 22 February 2007, past Cabinet minutes and submissions that she was involved in, the 11 areas to be released for expressions of interest, a conversation with Mr Craig Munnings of Mr Macdonald's office sometime after the briefing note dated 13 May 2008 about the Minister's power to grant an exploration licence, and the deviation from the usual process for issuing letters of consent. In this trial, Ms Madden provided further evidence about the concerns in the briefing note of 13 May 2008 and her basis for raising probity issues. Ms Julie Moloney 1. The transcript of the evidence of Ms Julie Moloney of 16 February 2017 was tendered. [40] She was also called in this trial. She worked as a geologist in the DPI until 2004, when she became the senior project officer and then the principal advisor in the industry coordination team for Mineral Resources. The industry coordination team provided briefings to the Minister's office, drafted Ministerial responses, undertook flagship publications the DPI produced for Mineral Resources, and coordinated Mineral Resources' responses to the Department of Planning for planning purposes. She later worked in the Titles Services team granting mining titles within the State. She was also the secretary of the Coal Allocation Committee and a member of the Expression of Interest Evaluation Panel for the 11 areas that were competitively released. She maintained the register of interests in coal allocations spreadsheet. 2. Ms Moloney adopted the evidence given in the first trial and was then further cross-examined by the accused. She gave evidence about the government mining policy, past instances of direct allocation, the 11 areas that were released for expressions of interest and the process of allocation via expressions of interest. In this trial, she gave further evidence about the Proposed NSW Coal Allocations document, [41] the process of evaluating different training mine proposals in a competitive process, her experience of engaging with proponents regarding their proposals or expressions of interest and the amount of drilling conducted in the Watermark and Caroona areas as compared to the Doyles Creek area. Mr Anthony Hewson 1. The transcript of the evidence of Mr Anthony Hewson of 16 and 17 February 2017 was tendered. [42] Mr Hewson worked as Mr Macdonald's Chief of Staff from about 2004 until April 2007. His job as Chief of Staff in the Ministerial Office involved running the office, the budget and allocating work. [43] About April 2007, Mr Hewson left his position as Chief of Staff and went to work for BHP Billiton as Government Relations Director. [44] 2. Mr Hewson gave evidence about the relationship between Mr Macdonald and Mr Maitland, Mr Macdonald's relationship with stakeholders generally, the meeting between Mr Macdonald and Mr Maitland on 19 January 2017 when the training mine idea was discussed for the first time, the application and grant of the Doyles Creek exploration licence, including the briefing notes, correspondence within the Minister's office and with other stakeholders about the proposal, the meeting with Mr Maitland and Ms Tan on 8 March 2007 and Mr Macdonald's attitude towards the options up until the time he left his role as Chief of Staff. Ms Sue-Ern Tan 1. The transcript of the evidence of Ms Sue-Ern Tan of 17 February 2017 was tendered. [45] Ms Tan worked as a Department Liaison Officer in Mr Macdonald's office from May 2006 to early 2008, with her particular focus being the Department of Mineral Resources. Mr Jamie Gibson was her successor in the role. She gave evidence about the relationship between Mr Macdonald and Mr Maitland, the meeting between Mr Macdonald and Mr Maitland on 19 January 2017 and the application and grant of the Doyles Creek exploration licence, including correspondence within the Minister's office and with other stakeholders about the proposal, the meeting with Mr Maitland and Mr Hewson on 8 March 2007, the Prime Restaurant meeting on 26 July 2007 with Mr Maitland, Mr Macdonald and Mr Ransley, the request to the DPI for a briefing on the skills shortage in the mining industry following this meeting, the following up on the letters of support, and the meeting with the University of Newcastle on 5 November 2007 in the Minister's office. Mr Jamie Gibson 1. The transcript of the evidence of Mr Jamie Gibson of 20 February 2017 was tendered. [46] Mr Gibson worked as Mr Macdonald's Deputy Chief of Staff and policy adviser for mining in 2007 and became Chief of Staff in 2008. He gave evidence about the relationship between Mr Macdonald and Mr Maitland, Mr Macdonald's interest in the safety of miners, the process after a proponent receives consent by the Minister to apply for an exploration licence, the proposal to release 11 small areas for expressions of interest, the March 2008 training mine facility submission and his anticipation that it was forthcoming, discussions between Mr Macdonald and Mr Coutts at meetings about the proposal and their disagreement, the Department's briefing note of 13 May 2008, the meeting at the Strangers' Dining Room on 17 June 2008 with Mr Maitland, Mr Macdonald, Mr Ransley and Mr Munnings, the custom of Mr Macdonald to discuss Ministerial business over meals, the meeting on 14 August 2008 with Mr Maitland and Mr Munnings about soliciting support from the Minerals Council of Australia (MCA) and the NSW Minerals Council, drafting of the invitation letter by Mr Macdonald and himself in August 2008, preparation of the special conditions, the meeting at the Nippon Club on 25 November 2008 between Mr Macdonald, Mr Maitland, Mr Ransley and himself, the signing of the exploration licence at Catalina Restaurant on 15 December 2008 which he attended, the preparation of the media release and various correspondences following the grant of the exploration licence. Mr Brendan McPherson 1. The transcript of the evidence of Mr Brendan McPherson of 21 February 2017 was tendered. [47] He was also called in this trial. Mr McPherson was the CEO of Donaldson Coal Pty Ltd from 2000 to 2010. 2. Mr McPherson adopted his evidence given in the first trial and was then further cross-examined by the accused. He gave evidence about Mr Maitland seeking a letter of support from Donaldson Coal for a training mine in mid-2008, the in-house training program at Donaldson Coal and Mr Maitland's interest in training mines. In this trial, he provided his views on the efficacy of different types of training, the cost of operating a training mine, his support for training his own workforce and the reputation of various organisations from which letters of support were received. Mr Nathan Rees 1. The transcript of the evidence of Mr Nathan Rees of 22 February 2017 was tendered. [48] He was also called in this trial. Mr Rees had been a member of the ALP for a number of years, and was, at times, part of the Left faction of the ALP. He was a member of the NSW Cabinet from March 2007 and was the Premier, unaligned to any faction, after Mr Iemma's resignation as Premier from 5 September 2008 to 4 December 2009. 2. Mr Rees adopted the evidence given in the first trial and was then further cross-examined by the accused. He gave evidence on political fundraising, the induction of Ministers, briefing on Cabinet conventions, the types of matters to be brought to the Cabinet, the role of the Budget Committee, the Cabinet's consideration of the proposed decision to grant an exploration licence in respect of an area called Cobbora, and the financial environment in NSW during his premiership. He also gave evidence of a conversation between himself and Mr Macdonald prior to 25 December 2008 where Mr Macdonald apparently indicated there was negligible commercial value in the mine. In this trial, he gave further evidence about his recollection of the conversation between himself and Mr Macdonald. Mr Michael Buffier 1. The transcript of the evidence of Mr Michael Buffier of 27 February 2017 was tendered. [49] He was also called in this trial. Mr Buffier was the Chief Operating Officer of Xstrata Coal (now known as Glencore) in New South Wales between 2002 and February 2009. In early 2009, he became the Group Executive to Sustainable Development and Industrial Relations within Xstrata Coal. He was also a member of the Executive Committee of the NSW Minerals Council during 2008, involved in the World Coal Association from around 2009 until the end of 2021 and at the time of giving evidence at this trial was the Deputy Chair of the Coal Industry Advisory Board to the International Energy Agency in Paris. 2. Mr Buffier adopted the evidence given in the first trial and was then further cross-examined by the accused. He gave evidence about DCM's invitation to Xstrata to be a potential joint venture partner in the DCM proposal, the letter of support Xstrata provided for the training mine idea and the skills shortage in the mining industry between 2007 and 2008. At this trial, he commented on the Training Mine Pre-Feasibility Study by Mr Rob Gibbons (the Gibbons report) [50] and provided further evidence about actual underground training mines and their advantages, the NSW Minerals Council's views on training mines, the invitation by DCM for the joint venture involving the Doyles Creek area, and whether Xstrata may have considered bidding for the Doyles Creek area if it was conditional upon the establishment and maintenance of a training mine. Mr Nicholas Papallo AO 1. The transcript of the evidence of Mr Nicholas Papallo AO of 20 February 2017 was tendered. [51] Mr Papallo had been a solicitor for 51 years at the time of giving evidence. He was the principal of the firm NJ Papallo Lawyers until he passed the practice over to his son. He was appointed as chair by Mr Macdonald to the Minerals Ministerial Advisory Council (MMAC) in 2005 and remained in that role until 2011. [52] 2. Mr Papallo gave evidence about the functions and key priority issues of the MMAC and various meetings held by the MMAC between November 2005 and August 2007. Mr Richard Jones 1. The transcript of the evidence of Mr Richard Jones of 21 February 2017 was tendered. [53] Mr Jones was the Chief Executive Officer of the Westpac Rescue Helicopter Service (WRHS), also known as the Hunter Region SLSA Helicopter Rescue Service Ltd. He had been employed as the General Manager of WRHS since 1995. [54] WRHS was a not-for-profit organisation that received donations from public and private sponsors, including payroll deductions from coal mine employees facilitated through the CFMEU. [55] From time to time, the WRHS was used for mine rescues when there was an accident. Mr Jones knew Mr Maitland through the CFMEU and his visitations to the WRHS facilities in Broadmeadow. 2. Mr Jones gave evidence about the letter of support provided by the WRHS to DCM, discussions about executing a memorandum of understanding, meetings between Mr Maitland and the not-for-profit organisations including WRHS in 2007, the WRHS General Manager's Report dated 20 September 2007 which referred to the "strategy" in relation to the letters of support and the Community Partnership Agreement which was eventually executed between the WRHS and DCM. Mr Paul Healey 1. The transcript of the evidence of Mr Paul Healey of 21 February 2017 was tendered. [56] Mr Healey was employed by Coal Services Pty Ltd (Coal Services). Coal Services was formed in 2001 under the Coal Industry Act 2001 (NSW) as an amalgamation of the Joint Coal Board, Coal Mines Insurance and Mines Rescue. Coal Services was jointly owned by the NSW Minerals Council and the CFMEU with two directors from each organisation and two independent directors. [57] Mr Healey was the General Manager of the Mines Rescue division of Coal Services in 2008 which provided nationally accredited training programs including underground simulation and virtual reality training. [58] At the time of giving evidence he was the Manager of the Order 42 division of Coal Services which reviewed, audited and approved mine training plans. [59] 2. Mr Healey provided evidence about the Mines Rescue training programs, a meeting in July 2008 where Mr Maitland discussed the possibility of Coal Services supplying services to DCM's proposed training mine, his views on the DCM proposal at the time and the demand for training services within the industry in around 2007 and 2008. Mr Jason Bartlett 1. The transcript of the evidence of Mr Jason Bartlett of 21 February 2017 was tendered. [60] Mr Bartlett was the senior media advisor to Mr Macdonald as the Minister for Primary Industries from late 2006 and was responsible for overall media communications in the Minister's office. He worked closely with the junior media advisor, Lyndall Hilder (who was Lyndall Derrig at the time). 2. He provided evidence about the dinner at Catalina Restaurant on 15 December 2008 where the exploration licence was signed, the circumstances surrounding the preparation of the media release announcing the grant of the exploration licence and Government Gazettes about the grant. Mr Archibald Tudehope 1. The transcript of the evidence of Mr Archibald Tudehope of 22 February 2017 was tendered. [61] Mr Tudehope started working as a miner from the 1970s in Mount Isa and was in the Australian Workers' Union. When he moved to Collinsville, Queensland, in 1980, he became involved in the Queensland Collieries Union, now part of the CFMEU, Mining & Energy Division. Within that union, he held positions as Treasurer and President of the Lodge and later was on the Board of Management of the State division of the Union. He had also served on the Central Council, which he described as the Federal legislative body of that Union. [62] Mr Tudehope first met Mr Maitland in Collinsville when they were both involved in the Union in the 1970s. He maintained a friendship with Mr Maitland and assisted with his election to various roles in the Mining Division in Queensland. [63] Between 2007 and 2011, Mr Tudehope lived in China working as the director of a company that developed mine safety standards. 2. He gave evidence about discussions he had with Mr Maitland about the training mine proposal where he sought potential investors, the assistance he provided to Mr Macdonald's daughter when she went to China, the relationship between Mr Macdonald and Mr Maitland and Mr Maitland's commitment to improving mine safety. Ms Lyndall Hilder 1. The transcript of the evidence of Ms Lyndall Hilder (formerly Ms Lyndall Derrig) of 22 February 2017 was tendered. [64] She was a media advisor for the Department of Planning in early 2007. Between 20 June 2007 and August 2009, she was a media advisor to Mr Macdonald as the Minister for Primary Industries. 2. Ms Hilder provided evidence of media inquiries about DCM in September 2008 and the circumstances surrounding the preparation of the media release announcing the grant of the exploration licence. Mr James Chisholm 1. The transcript of the evidence of Mr James Chisholm of 23 February 2017 was tendered. [65] Mr Chisholm was a director of Fertoz, Atrum Coal and Ebony Energy. In 2007, he had a shareholding in ResCo and acquired businesses for ResCo. 2. Mr Chisholm provided evidence about the discussions at a meeting at Rathmines on 15 January 2007 where a geologist, Dr Palese, identified the Doyles Creek area as being prospective for coal. Mr Peter Coates 1. The transcript of the evidence of Mr Peter Coates of 27 February 2017 was tendered. [66] Mr Coates had been a mining engineer in the mining industry for approximately 50 years. He was the CEO of Xstrata Coal until December 2007 and the non-executive chair of Xstrata Coal from January 2008 to July 2009. [67] Around late 2005, Mr Macdonald asked Mr Coates to be a member of the MMAC. In 2006, Mr Coates became the chair of the MCA. 2. Mr Coates provided evidence on the role of the MMAC and the MCA, meetings of the MMAC, his views as at February 2006 on the existence of a skills shortage in Australia and interactions with Mr Maitland regarding the possibility of Xstrata Coal's involvement in the DCM proposal. Mr Anthony Maher 1. The transcript of the evidence of Mr Anthony Maher (also known as Tony Maher) of 21 February 2017 was tendered. [68] He took over the position of General President in the Mining and Energy Division of the CFMEU in August 1998 after Mr Maitland became Chair. Mr Maher had known Mr Maitland since the late 1980s and had dealt with Mr Macdonald on occasions when he was the Minister for Mineral Resources. 2. Mr Maher provided evidence about the relationship between Mr Macdonald and Mr Maitland, discussions with Mr Maitland about the training mine proposal and the provision of a letter of support, and the CFMEU Mining and Energy Division Executive's position on the training mine. Dr Nicole Williams 1. The transcript of the evidence of Dr Nicole Williams of 27 February 2017 was tendered. [69] Dr Williams was relevantly the CEO of the NSW Minerals Council from July 2004 to November 2011. At the time of giving evidence, Dr Williams was also the CEO of the Plastics and Chemical Industries Association and General Manager of Marketing and Business Development and Procurement for Coal Procure Pty Ltd. She also held three non-executive directorships and was an Ambassador for the Australian Indigenous Education Foundation. Prior to that, she had worked for Esso Australia in industrial relations, the World Coal Institute in London as Director of Public Affairs, Shell in respect of coal trading, and Shell International Gas as Development Manager for Sub-Saharan Africa. She was also an accredited energy expert with the United Nations Economic Commission for Europe and has served on a number of national and international advisory boards for government, industry and science. 2. She gave evidence about her past interactions with Mr Macdonald and Mr Maitland, the perspectives of directors and shareholders of a commercial mining company, the coal allocation process, the role and activities of the NSW Minerals Council, Coal Services, her understanding of the Doyles Creek training mine proposal, Mr Maitland and Mr Macdonald's attempts to seek her support for the proposal as CEO of the NSW Minerals Council, the NSW Minerals Council Executive Committee meeting on 11 September 2008 to discuss the proposal and the skills shortage and concern for mine safety in the mining industry. Mr Lawrence Ireland 1. The statement of Mr Lawrence Ireland dated 25 February 2015 [70] and the transcript of evidence given by Mr Ireland on 9 October 2017 [71] were tendered. (That evidence was not from the first trial against Mr Macdonald and Mr Maitland, but was given in other, unspecified, proceedings. Nor was the statement in evidence in the first trial.) Mr Ireland had spent 43 years working as a miner, including as a mine manager in several mines such as Baal Bone Colliery and the Teralba Colliery. He had also worked as an operations manager for Xstrata Coal in the 2000s and left at the end of 2007. He joined ResCo in late 2007 and assisted with putting together the March 2008 Doyles Creek application. [72] After working on the DCM project, he became General Manager of ResCo Underground Services and then re-joined Xstrata in March 2010. [73] 2. In his statement, he gave his estimation of the reserves in the Doyles Creek area and the bases for his calculations, his understanding of how the training facility and panels would operate, the circumstances of his joining ResCo, various meetings he attended in 2007 and 2008 about the project and his role in assisting in the identification and purchase of suitable land for the project, and his investment in DCM. 3. In 2017, he expanded further on the circumstances of his joining ResCo, his understanding of the nature of the Doyles Creek resource and the proposed training panels, and his contributions to the Doyles Creek application. Mr Robert Cameron 1. The statement of Mr Robert Cameron dated 28 August 2012 was tendered. [74] Mr Robert Cameron was the non-executive chair of Centennial Coal Company Limited at the time of giving the statements. In 2008, he a member of the NSW Minerals Council Executive Committee, having previously been the Chair. 2. Mr Robert Cameron gave evidence about being approached by Mr Maitland to write a letter of support on behalf of Centennial Coal Company Limited in mid-2008, his views on establishing a mining school at the University of Newcastle, his views on the general training mine concept, the viability of the Doyles Creek proposal, his knowledge of other training mines and facilities and the skill shortage in the mining sector in 2008. Mr Ian Macdonald 1. As noted above, Mr Macdonald's evidence, given at the first trial, was tendered in the Crown case. [75] 2. Mr Macdonald gave evidence on his various roles in Parliament, his understanding of ministerial duties, cabinet processes and the financial environment at the time, his relationship with Mr Maitland (including the assistance that Mr Maitland provided to his daughter), the circumstances surrounding his pre-selection for the Legislative Council and the Noble House meeting, his views on the pros and cons of DCM's training mine proposal, the skills shortage in the mining sector in NSW and his request to the Department to look for other areas to release for competitive expressions of interest. 3. He was taken through the exhibits and gave evidence on the events leading up to, and the circumstances surrounding, the grant of the consent to apply for the exploration licence and the grant of the exploration licence to DCM. The key events included the meeting with Mr Maitland in January 2007 where the training mine was raised for the first time, the meeting with Mr Maitland and Mr Ransley at the Prime Restaurant in July 2007 and the alleged strategy in relation to the letters of support, his discussions with the University of Newcastle about establishing a Chair of Geoscience, the meeting with Dr Williams allegedly seeking support from the NSW Minerals Council, the meeting at the Nippon Club in November 2008, the signing of the exploration licence at Catalina Restaurant in December 2008, and events following the grant, such as the circumstances surrounding the media release, his conversation with Mr Rees where he allegedly said there was "negligible commercial value" in the mine and the representations he made about the grant in his letter to Alan Jones dated 3 February 2009. 4. He also gave evidence about his response to each of the briefing notes, his understanding of the options and his power to pursue a direct allocation, the presence of policy difficulties and the probity issues as raised by the Department, his understanding of the Coal Allocation Guidelines, his views on DCM's training mine facility submission, the formal application for the exploration licence and the proposed conditions of the licence together with his understanding of the nature, size and the perceived value of the Doyles Creek area. In addition, he was questioned about his discussions and correspondence with Mr Mullard, Mr Coutts and other departmental and ministerial staff about the proposal, past instances of direct allocations, the Caroona and Watermark allocations, the Extension of the New Frontiers Exploration Initiative, his decision not to refer the proposal to the MMAC or Mine Safety Advisory Council (MSAC), his motive for granting the exploration licence to DCM, the forgoing of a potential AFC and the decision not to refer the matter to Cabinet. 5. Mr Macdonald also gave evidence that he did not, at the time, use a computer. [76] The result was that the case against him was, to an extent, limited to the documents it could be established he was shown, or what he had been told. 5. The evidence called by Mr Macdonald 1. While it is convenient to speak of the "the case for Mr Macdonald", I remind myself that he has no "case" in the sense that he has no obligation to answer the Crown case. As in the case of all accused persons on trial (with limited exceptions not here relevant), his "case" is that the Crown has not proved his guilt beyond reasonable doubt. He relies on particular parts of the evidence, and on arguments to support that contention. 2. Mr Macdonald relied on the evidence he gave in the first trial, which has been discussed above. He called one additional witness, Mr John Della Bosca. 5.1 Mr John Della Bosca 1. Mr Della Bosca was a member of the NSW Legislative Council from March 1999 to July 2010 and held various ministerial offices and positions during this period. He was also a Special Minister of State between April 1999 and February 2006, where he was tasked with dismantling the Joint Coal Board and he subsequently established Coal Services. He met Mr Maitland during the course of this work and recalled him indicating his support for the training mine idea. [77] 2. Mr Della Bosca gave evidence about the options and concerns raised in the briefing notes, the significance of departmental advice to a Minister's decision-making, the types of matters that should be brought to Cabinet, Mr Macdonald's pre-=selection for the Legislative Council in 2007 and the significance of the support of the CFMEU, the Department's focus on health and safety in the mining industry, Ministerial duties and the relationship between ALP politics and the union movement. 5.2 Mr Maitland's evidence and evidence called by him 1. Mr Maitland's evidence and the evidence called by him is discussed below. That evidence is, where relevant, also available in the case with respect to Mr Macdonald. 5.3 Some directions with respect to Mr Macdonald's case 1. Understood in the manner described above, Mr Macdonald's case was that in granting the consent to apply, and the exploration licence, he acted in accordance with his ministerial duty, in the best interests of the State. In this regard he believed the proposed training mine, and matters associated with it, would provide a genuine public good which justified a direct allocation of the resource to DCM. He believed that DCM's proposal solved the problem of how such a facility would be funded, by operating it in conjunction with a commercial mine, and thus resolving a matter which had been a sticking point in past efforts to establish a training mine. He regarded the present proposal as impressive; the proponents had demonstrated a need, and that they had support from industry and the unions. He, as a result, formed a favourable view of the proposal and was not required to follow the Department's advice. He relied on other evidence which supported this evidence. 2. I noted above that, putting Mr Macdonald's evidence to one side, the evidence is essentially circumstantial. While the Crown relied on some parts of Mr Macdonald's evidence as admissions, it is, in its overall effect, direct and exculpatory. I note that Mr Macdonald gave that evidence on oath and subjected himself to cross-examination by experienced senior counsel for the Crown. I cannot convict Mr Macdonald of either count if I accept his evidence to the effect that he did not misconduct himself on the occasions of making the grants the subject of that count. Nor can I convict Mr Macdonald if, while not accepting his evidence, there is a reasonable possibility it may be true. Even if I reject Mr Macdonald's evidence, I must still be satisfied of his guilt based on the other evidence in the Crown case (and having regard to any evidence called by either accused which I have not rejected). In considering whether Mr Macdonald's evidence is true or whether it is reasonably possible that it is true, consistent with what I have said above, I would not reject his evidence unless satisfied that the benefit of seeing and hearing him give evidence could have made no difference to my rejection of his evidence. 3. Mr Macdonald did not give evidence in this trial. His decision in this regard is readily understandable given his reliance on his evidence in the first trial. Nonetheless, I remind myself that, consistent with the onus of proof, he was under no obligation to do so, and that further, his decision not to give evidence before me cannot be used against him in any way. It cannot be used as an admission of guilt. Nor can I use his decision not to (again) give evidence to draw any inference or reach any conclusion adverse to him. That includes by using his decision to fill any gaps in the Crown case, to regard the Crown case as stronger or otherwise assist the Crown in proving his guilt. 6. The evidence called by Mr John Maitland 1. As with Mr Macdonald, I remind myself that Mr Maitland does not have a "case" but rather relies on evidence and submissions to support his contention that the Crown has not proved its case. 6.1 Mr Maitland's evidence 1. Mr Maitland elected to give evidence at this trial. He started working as a miner in Queensland in 1970. Between 1972 and 1976, he worked as a rescue team captain and from 1976 to 1981, he worked full-time as a Deputy. Between 1981 and 1985, he acted as the Queensland District Secretary of the Australasian Coal and Shale Employees' Federation, commonly known as the Miners' Federation. In 1985, he was elected to be the General President of the Miners' Federation and he subsequently moved to Sydney. He had been appointed on a few occasions as an adviser to the Warden in Warden's inquiries involving mining fatalities. In 1988, he became the Vice President of the International Miners' Federation, which became part of the International Federation of Chemical, Energy, Mine and General Workers' Union (ICEM). In 1998, he became the National Secretary for the CFMEU. In 1999, he became the President of the ICEM. In 2005, he was part of the Australia-China Mine Safety Taskforce to provide advice, expertise and resources to reduce deaths and injuries in the Chinese mining industry. In 2006, he retired from his role as the National Secretary for the CFMEU. He was appointed as the chairperson of the Coal Competence Board by Mr Macdonald in the same year and later, in 2007, he became chair and one of three directors of ResCo. 2. Mr Maitland provided evidence of his career, his interest and commitment to mine safety over the years, his relationship with Mr Macdonald, the circumstances surrounding his involvement with ResCo, the conception of the training mine idea, the entire process of applying for the exploration licence, his efforts to gather industry and community support, the results of DCM's exploration of the area and his character. In cross-examination, he was questioned about his financial interest in DCM, the value of the exploration licence and its impact on the value of DCM shareholdings, his motive for pursuing the proposal, and his access to Mr Macdonald and his union background as being the reason ResCo hired him as chair. He was also questioned about his relationship with Mr Macdonald, his involvement in ALP politics, his retirement functions and the circumstances surrounding Mr Macdonald's pre-selection in 2007. 3. Mr Maitland was taken through documents which related to the events leading up to the grant of the exploration licence, including the meeting at Rathmines with Dr Palese in January 2007, his meeting with Mr Macdonald where he first mentioned the training mine idea, the meeting at Prime Restaurant in July 2007, his attempts at obtaining letters of support following this meeting, DCM's training mine facility submission, the meeting at the Strangers' Dining Room in June 2008, the meeting with Dr Williams of the NSW Minerals Council in July 2008, the application for the exploration licence submitted in September 2008, the Nippon Club meeting in November 2008 where Mr Macdonald informed Mr Maitland that a letter of approval would be issued and the signing of the exploration licence at the Catalina Restaurant on 15 December 2008. In relation to these documents and events, he was questioned about the genuineness of the representations he had made regarding the nature of the proposed training mine, the magnitude of the skills shortage and the size of the resource, the alleged deficiencies of the training mine facility submission, the alleged strategy pursued by him and Mr Macdonald to justify the direct allocation, the increase in the value of his shares following the grant of consent to apply for the exploration licence, the alleged lack of genuine industry and community support for the proposal, the certainty of the direct allocation of the exploration licence and the idea of the exploration licence being a valuable asset. He was also questioned about the Caroona and Watermark allocations, his understanding of the competitive allocation process, the scarcity of unexploited coal resources in New South Wales and his understanding of the Department's views on the proposal. 6.2 Mr Glen Lewis' evidence 1. Mr Maitland called Mr Glen Lewis as a witness at this trial. Mr Lewis had worked in the coal industry for the past 42 years, predominantly in NSW. He had worked as an apprentice and supervising electrician, shift supervisor, coal mine manager, general manager of three operating mines at Xstrata and the Managing Director of ASX listed companies within the coal industry. He joined ResCo Underground Services as the Chief Operating Officer in about September 2008 and became a shareholder not long after. He joined the Board of DCM in August or September 2009. 2. Mr Lewis gave evidence about the risks faced by miners, the responsibility of mine managers, the nature of existing training practices and the findings of the report of the former premier, the Honourable Neville Wran AC QC into mine safety in New South Wales (the Wran report), which was tendered by Mr Maitland. [78] He also gave evidence about the circumstances surrounding the commencement of his Chief Operating Officer role in ResCo, the basis for ResCo's interest in training mines, the process involved in building and raising funds for a training mine, the differences between the Watermark and Caroona resources and the Doyles Creek resource including geological impediments in the latter resource, his views on the benefits of the Doyles Creek proposal, factors that impact the value of an exploration licence and ResCo's application for a licence in Springsure, Queensland to build a training mine. In cross-examination, he was questioned about the relative merits of simulation training as opposed to training in a real environment and the existence of a skills shortage. He was also questioned about the certainty of the grant of an exploration licence after receiving an invitation to apply, ResCo's labour hire operations, the timing of the conception of the training mine idea, his investments in ResCo, the idea of the exploration licence being a significant asset, the alleged deficiencies in the training mine facility submission, factors affecting the worth of an exploration licence and the potential interest of other companies in establishing a training facility in order to obtain the exploration licence. It was also suggested to him that he was motivated to assist Mr Maitland due to the impact of the allegations on his own reputation. 6.3 Mr Andrew Poole's evidence 1. Mr Maitland called Mr Andrew Poole as a witness at this trial. Mr Poole worked in various finance and commercial positions from 1980 and had sat on the Board and been the Chief Financial Officer for a number of publicly listed companies. In 1998, he commenced working as the Chief Financial Officer of Bradken (previously Morgan Steel), which was involved in providing capital equipment and resources to the mining and resources area and was the largest publicly listed company headquartered in the Hunter Valley at the time. He left Bradken in 2005, and in 2006, joined the board of a company called TESA and incorporated ResCo, of which he was a director, with Mr Ransley. In 2012, he resigned from the boards of the businesses he had been involved in and at the time of giving evidence, he was the Managing Director of Lebina, a small company in Newcastle. 2. Mr Poole gave evidence about the incorporation of ResCo and his and Mr Ransley's reasons for inviting Mr Maitland to join, the membership of the DCM board, the Rathmines meeting with Dr Palese in January 2007, the obtaining of legal advice from Sparke Helmore throughout the application process, the content of the application, the company's efforts to raise capital, industry support and community consultation, his views on the level of risk in his investment in DCM, the use of business teasers to attract investors and the relationship between Mr Macdonald and Mr Maitland. In cross-examination, he was taken through documents which related to the events leading up to the grant of the exploration licence, including the meeting with Dr Palese in January 2007, the company's attempts to seek investment after obtaining the consent to apply for an exploration licence and the signing of the exploration licence at Catalina Restaurant in December 2008. He was also questioned about his understanding of the operational and financial aspects of the training mine, the use of the training mine as a "pretext" to justify a direct allocation, the significance of the prospect of a change of government and his understanding of probity issues and the duties of directors and ministers. 6.4 Some directions with respect to Mr Maitland's case 1. While not the subject of any evidence or comment (and nor could it be), it is apparent from the manner in which this trial was conducted that Mr Maitland did not give evidence at the first trial. While not strictly necessary, having regard to this practical reality, I make clear that Mr Maitland's choice at that earlier trial cannot be used against him, and give myself the same direction as I gave myself with respect to Mr Macdonald in this regard. (I note there is no evidence either Mr Maitland or Mr Macdonald had any earlier opportunity to give an account.) 2. Mr Maitland did, of course, give evidence. His "case", consistent with that evidence, was that at no stage did he believe Mr Macdonald would be engaging in misconduct if he granted the consent to apply or the exploration licence. He certainly did not intend that Mr Macdonald would do so. Rather, he genuinely believed in the merits of DCM's proposal. In particular, he believed the proposed training mine and that which was associated with it, including a number of community partnerships or "strategic alliances", would provide a significant public benefit. Moreover, he believed he had solved the issue of funding to operate such a mine, which had been a sticking point in the past. Consequently, he believed that Mr Macdonald was entirely justified in approving the proposal in accordance with his obligations as a minister. 3. If I were to accept Mr Maitland's evidence on this central feature with respect to either of the offences against him, I would, of course, acquit him of that offence. If I do not accept his evidence, but regard it as reasonably possible it is true, I must also acquit. If I were to reject Mr Maitland's evidence, it is to be put to one side. I would then need to consider if I am satisfied of Mr Maitland's guilt with respect to each charge, based on the evidence which remains. 4. In considering Mr Maitland's case, based on the evidence discussed below, I accept he has the benefit of good character. That good character means that he is less likely to have committed the serious offences alleged against him. It also means that he is more likely to have been truthful in his evidence given before me. 7. The case in detail: Part 1 – The Crown's alleged motive and the accused's asserted motivations 7.1 The Crown's alleged motive 7.1.1 The significance of motive 1. The Crown sought to prove that Mr Macdonald had a motive to assist Mr Maitland. The Crown relied on what it asserted was a friendship between the two men as well as Mr Macdonald's political position. While proof of motive is not essential to the Crown case, the existence of a motive may operate as a circumstance that, in combination with other circumstances, leads to an inference of guilt. Evidence of motive was primarily based on the evidence of a lunch meeting on 20 February 2007 which came to be called the Noble House meeting, together with the observations of other witnesses of the relationship between the two men. 7.1.2 Mr Macdonald's political position – the Noble House meeting 1. What came to be called the Noble House meeting was organised by Mr Foley and attended by Sen Campbell, Mr Doug Cameron, Mr Bastian and Mr Albanese, all of whom were, at the time, senior members of the ALP. 2. The evidence in relation to what was described as the Noble House meeting was presented by the tender of transcripts of evidence given at the first trial, in February 2017, and in the case of Mr Foley and Mr Albanese, evidence on 20 February 2020 in proceedings the nature of which were not identified before me. 3. The evidence was relied on by the Crown to establish that while Mr Macdonald may have wanted to retain his position as a candidate for the Legislative Council, he was expected to resign midway through the term following the 2007 election. It was also relevant to establish the relationship between the two accused, and in particular the extent to which, if at all, Mr Macdonald was dependent on Mr Maitland for support to maintain his position as a Labor candidate for the Legislative Council. Mr Luke Foley 1. Mr Foley gave evidence that in 2006 he was opposed to Mr Macdonald being pre-selected, and that he put this not only to Mr Macdonald, but also to others. He said that he felt that given the number of years that Mr Macdonald had spent in Parliament, it was time for "somebody else to have a go". [79] He said that Mr Macdonald was resistant to the proposition that he retire. 2. Mr Foley said that he attended lunch at the Noble House restaurant with Mr Macdonald. He invited Sen Campbell, Mr Doug Cameron, Mr Bastian and Mr Albanese. The issue of Mr Macdonald's pre-selection was discussed. Mr Doug Cameron, the most senior official of the AMWU indicated that the Union would support Mr Macdonald's pre-selection. Mr Bastian, the State Secretary of the AMWU, supported Mr Doug Cameron's position. Mr Foley said that Mr Albanese said that if Mr Macdonald had the support of the AMWU and also the Miners' Union, then he had "the numbers" for pre-selection. This was shorthand for having the votes of a sufficient number of delegates at the conference of the NSW Labor Party, where pre-selection was determined. (I pause to note that references to the Miners' Union are most likely references to what had then become the Mining Division of the CFMEU. A number of different mining associated unions came together to form the Miners' Federation, and subsequently became part of the CFMEU. [80] ) He said that, Mr Albanese said that, as a minister, it was hard to take his pre-selection from him. Sen Campbell, like Mr Foley, suggested Mr Macdonald should retire. Mr Foley said that Mr Macdonald put his own case for pre-selection based on his seniority in government, his belief that he had the confidence of the Premier and his personal circumstances. Mr Foley said that Mr Macdonald said he had "the metalworkers" (referring to the AMWU) and "the miners" (a reference to the mining division of the CFMEU). Mr Foley said that, at that time the senior officials of the CFMEU who spoke on the union's behalf in Labor Party affairs were the accused, Mr Maitland, Mr Tony Maher, and Mr Peter Murray. He agreed that while he could not recall Mr Macdonald referring to unions other than the AMWU and the Miners' Union he was "certainly talking himself up" with respect to the support that he had. He said that Mr Macdonald also spoke about his performance as a minister and, in his evidence in 2020, said that Mr Macdonald said he had a number of projects he wanted to continue working on. 3. With respect to his personal circumstances, Mr Foley said that Mr Macdonald referred to his financial circumstances, his family circumstances, and also said he wanted to attend the Beijing Olympics as a minister. 4. Following on from the above meeting, Mr Foley said he contacted Mr Maitland, Mr Maher and Mr Murray, and that each of them, separately, indicated they would support Mr Macdonald for pre-selection. In cross-examination however, Mr Foley admitted that he had previously given evidence in 2012 that while he had discussed the matter with Mr Maher, consistent with his practice to talk to Mr Maher about party affairs, he did not recall having a discussion with Mr Maitland. He confirmed the evidence given in 2012 was true. Mr Maitland also denied ever being contacted by Mr Foley about the pre-selection and said that there was no reason for Mr Foley to contact him as he had no control over who the Mining Division supported. [81] 5. While Mr Foley rejected the proposition that the Miners' Union did not have any influence over the decision-making process, he did accept that the Miners' Division of the CFMEU controlled a relatively small number of votes in the left faction pre-selection process. To put this into context it was accepted that, to obtain pre-selection, Mr Macdonald would need around 70 out of the 280 available votes. Mr Foley agreed the largest block of votes was controlled by the AMWU with, he thought, "somewhere around thirty, the low thirties perhaps" [82] , with the result that without their support Mr Macdonald would not get pre-selection. In evidence given in February 2020 he said "a candidate with the support of the AMWU would be a very short price favourite" [83] to obtain pre-selection. 6. The next most important union in this process was the Miscellaneous Workers' Union with a number of votes in the low to mid-20s, followed by the construction division of the CFMEU. Comparatively, the mining division of the CFMEU controlled "a relatively smaller number of votes" [84] , with eight to ten votes. He said it was the case that because the AMWU was the single most important supporter of Mr Macdonald, Mr Doug Cameron was invited to lunch in order for Mr Foley to test whether they would give him ongoing support. He ultimately accepted that the CFMEU was not represented at the lunch because "they weren't that important". [85] 7. With respect to this, Mr Foley accepted that, while Mr Maitland was the National Secretary of the CFMEU, this was in the context of the union being a federation of three unions, the Construction Union, Forestry Union, and the Mining and Energy Union. Those three divisions were largely autonomous rather than ruled by the National Secretary. Further, in 2006, Mr Maitland was less involved in New South Wales politics than Mr Maher, with the result that he did not play any significant day-to-day role in the politics of New South Wales. 8. Mr Foley said that of the three persons influential in controlling the votes held by the Miners' Division of the CFMEU, he was closest to Mr Maher, who he described as the person who exercised day-to-day leadership of the Miners' Union and the person with whom he would most frequently discuss party affairs. He understood, however, that Mr Maher would consult with Mr Maitland and Mr Murray and the three would come back with a unified position. 9. Ultimately, according to Mr Foley, an understanding was reached to the effect that Mr Macdonald would be given pre-selection, but would then retire of his own accord around the middle of 2009. Mr Foley said that while the discussions at lunch made this outcome "inevitable", it required "a couple more weeks" for this to be confirmed. [86] Mr George Campbell 1. Mr Campbell said he met Mr Macdonald in the late 70s and that they were "good friends for a very long time". [87] He said Mr Foley invited him to a meeting at Noble House for the purposes of a discussion with some of the key people relating to Mr Macdonald's pre-selection. Mr Campbell said that, given the length of time Mr Macdonald had served, he was concerned with him being pre-selected to serve a further eight years in Parliament. Mr Campbell said that Mr Macdonald put two arguments to the gathering. The first related to his financial needs as a consequence of his personal circumstances. The second was that he believed himself to be one of the better ministers in the Cabinet and that the then Premier would have been "reluctant, or refused, to let him not stand for the position". [88] He did not recall any discussion about specific support or who had the "numbers". [89] He said that while options were raised during the discussion, including the main option of Mr Macdonald gaining pre-selection but resigning during his term, no agreement had been reached by the end of the lunch. He said he was not involved in any discussions after the lunch. 2. Mr Campbell said he was aware that Mr Maitland was involved in the international labour movement in the 1990s and early 2000s. While he did not need to contact him very often, every time he tried to contact Mr Maitland he was overseas. Mr Paul Bastian 1. Mr Bastian also recalled attending the Noble House lunch for the purpose of discussing whether Mr Macdonald should seek pre-selection and whether he would receive the support of the left faction of the ALP with which Mr Bastian's union was affiliated. He said Mr Macdonald said he had some things he wanted to complete and raised an issue with respect to his personal circumstances. He said that Mr Cameron indicated his support for Mr Macdonald. He said he did not himself express a view or recall anyone else expressing a view "about supporting Mr Macdonald". [90] His recollection of the outcome of the meeting was that Mr Macdonald would be supported by the left. While he initially did not recall any condition being placed on that support, when taken to his statement, he agreed that Mr Macdonald would be nominated but would resign sometime into his next term. Mr Anthony Albanese 1. Mr Albanese said that he knew both Mr Macdonald and Mr Maitland. Mr Albanese recalled lunch at Noble House for the purposes of discussing Mr Macdonald's pre-selection. Mr Albanese said there were two issues: the first being whether Mr Macdonald would remain on the ticket and the second being how long he would stay if re-elected. He recalled Mr Macdonald indicating his desire to continue on in the Legislative Council and putting that he had been an effective minister. With respect to the duration of any future term he recalled Mr Macdonald wanting to stay for the Beijing Olympics together with a family reason, with the result that he would step down two years into his term. 2. Mr Albanese said he regarded Mr Macdonald's re-endorsement as "certain because ministers get re-endorsed", and that if this did not occur there would be intervention to correct this. [91] He said he did not recall any discussion as to what support Mr Macdonald had in terms of votes but also said that there was an awareness that he had support from the metalworkers and some branches of the CFMEU, namely forestry and mining. Mr Albanese said the outcome of the lunch was that Mr Macdonald would be pre-selected but would resign after two years. 3. In cross-examination, Mr Albanese agreed that the mining division of the CFMEU was, itself, an amalgamation of different groups, and that at least some of those groups did not always vote with the left faction (which I infer had the result that the number of votes held by the Miners' Union for the purposes of the pre-selection of left faction candidates might be less than had all the Miners' Union votes been available). Mr Albanese also agreed that Mr Maitland was not actively involved in Labor party factional politics and that Mr Maher was much more involved. Mr Douglas Cameron 1. The last of the Noble House witnesses was Mr Cameron. He confirmed that the AMWU was factionally aligned with the left of the ALP. He confirmed his attendance at the Noble House lunch and the purpose of it being to discuss the pre-selection issues. He said he expressed the view that Mr Macdonald should be given the opportunity to continue in his position for a period of time. He recalled Mr Campbell being strongly opposed to this position. He said Mr Macdonald spoke and defended his position, and also raised a desire to attend the Beijing Olympics as a minister as well as an issue in relation to his financial position. 2. Mr Cameron said that while there was no formal resolution there was basically a consensus that Mr Macdonald would continue, but give up his position after the 2008 Olympics. 3. He said that Mr Maitland was not a particularly influential person in relation to factional Labor Party politics. Mr John Della Bosca 1. Although Mr Della Bosca was not at the Noble House meeting, he gave some evidence about the circumstances surrounding the pre-selection issue. 2. Mr Della Bosca gave evidence that there was no doubt in his mind whatsoever that Mr Macdonald would be pre-selected in 2007. [92] This was firstly because he was at the time a very prominent figure in a particular sub-faction of the left of the Labor Party. The second reason was that he was an incumbent Minister and there was a broad assumption in the ALP at the time that incumbent Ministers would be endorsed. He said that even if he had lost the pre-selection, he would have been subsequently endorsed by the existing national sub-committee. [93] Mr John Maitland 1. While Mr Maitland was also not present at the Noble House meeting, he gave evidence about pre-selection. He disagreed with the propositions that he was aware the support of the AMWU alone was not enough to guarantee Mr Macdonald pre-selection or that Mr Macdonald needed the support of the miners of the CFMEU in order to obtain pre-selection. [94] He also denied that Mr Foley had spoken to him about the pre-selection and said that he would have had no reason to contact him as he had no control over who the Mining Division supported. [95] He further denied that he supported Mr Macdonald or that he thought it might be useful to help him in case he later needed his support. [96] The outcome of the Noble House meeting 1. Whilst the recollections of the various witnesses varied, a matter which is understandable given the lapse of time, the ultimate outcome is reasonably clear. The result was that Mr Macdonald would maintain his position on the Labor ticket for the Legislative Council at the forthcoming election, but would resign after serving around two years of his term. 7.1.3 The political relationship between the accused 1. The evidence referred to above with respect to the Noble House meeting is also relevant to the political relationship between the two accused. 2. While it is clear that Mr Macdonald was reliant on union support in order to maintain his political position, it is also clear that Mr Maitland was, at best, a minor figure in this regard. The Miners' Division controlled a relatively small number of votes with respect to pre-selection. Further, while it can be inferred Mr Maitland could at least attempt to influence how those votes were cast, the evidence fell well short of establishing that he could control them. Against this, there was no doubt Mr Macdonald had the support of the AMWU, which, according to evidence ultimately adopted by Mr Foley, of itself would make him a short price favourite. Of course, while the Miners' Division controlled only a relatively small number of votes, a small number of votes can, nonetheless, be decisive. However, there was no evidence that matters were poised such that this block of votes had that significance. Nor was there any evidence from the other senior members of the Miners' Division, Mr Maher and Mr Murray, that there was any push from Mr Maitland for the Division to support Mr Macdonald. Additionally, according to Mr Albanese, as a sitting Minister, Mr Macdonald's pre-selection was assured. Based on this evidence, I would not find that Mr Maitland had any significant influence over Mr Macdonald's pre-selection. Consequently, in the absence of evidence of any other political "favours" that were exchanged, I would not find that Mr Macdonald owed any form of political debt to Mr Maitland. 7.1.4 A friendship between the accused? 1. The Noble House witnesses (and other witnesses) were also asked questions as to their awareness of any relationship or friendship between the accused. Mr Foley said that he often saw them at Labor party events together and that "probably from the early 1990s" he observed them to have a "close and friendly relationship". [97] He said he had seen them in each other's company at Labor Party conferences, at social events in the New South Wales Parliament House and he "took it for granted" that they "got on well together". [98] In cross-examination, however, Mr Foley accepted that Mr Maitland was someone with whom he had limited connection outside Labor Party functions, with the result that he was not close enough to Mr Maitland to know who his true friends were. Mr Foley also agreed that in politics a colleague might be friendly to your face but working against you. [99] 2. As noted above, Mr Campbell regarded himself as a close friend of Mr Macdonald and socialised with him including by having dinners at each other's homes on a reasonably regular basis and visiting Mr Macdonald's farm. He had never seen Mr Macdonald interact with Mr Maitland on a social level. Additionally, Mr Campbell said that he had been a senior and influential figure in the Labor Party and had attended lots of Labor Party meetings but had no recollection of seeing Mr Maitland in a Labor Party meeting. [100] 3. Mr Bastian said that he was not aware of any relationship between Mr Macdonald and Mr Maitland, [101] although, while there was some evidence he knew Mr Macdonald, there was no evidence that he knew either of them particularly well. 4. Mr Cameron said that he had known Mr Maitland from about 1981 or 1982 and also knew Mr Macdonald as a result of his role within the ALP. He said he had seen them together at various places, mainly conferences and functions of the State or federal Labor Party. He said they were friendly and that he did not observe them closely but did observe they had "a decent relationship". [102] He agreed that his observations in this regard were no more than in passing and Mr Maitland generally treated people in a friendly manner. He agreed that in politics it can be difficult to know who was supporting you. He also stated it was common within the ALP and union movement to refer to a colleague as "mate" and that it would be naive to assume that somebody who calls you "mate" can be relied on as a true friend. [103] 5. Mr Iemma and Mr Costa were parliamentary colleagues of Mr Macdonald and senior members within the ALP. Neither had made any observations of a friendship or interactions between the two accused. [104] 6. Mr Hewson was, until April 2007, Mr Macdonald's Chief of Staff. He said that he had never seen the two accused together in 25 years, other than at two or three meetings when Mr Maitland was secretary of the CFMEU. In that context, he observed that they got on in a "professional manner". [105] While they were on first name terms he said they did not call each other "mate". [106] He also stated that in the 1998 pre-selection, Mr Maitland had, in fact, actively campaigned against Mr Macdonald in support of Mr Jeff Shaw's pre-selection. [107] 7. Ms Tan was a member of Mr Macdonald's staff holding the position of Department Liaison Officer. She said she first met Mr Maitland at his farewell dinner when he left the CFMEU in 2006. Mr Macdonald was at this event as were other members of his staff. She said that she had observed them together at meetings and that they seemed friendly, called each other "mate" or by first name. [108] 8. Mr Gibson observed the accused to be "comfortable" with each other and that their relationship was professional and cordial. [109] Mr Gibson said that in the course of discussions about Doyles Creek, Mr Macdonald had said to him that Mr Maitland, in his role with the CFMEU, had not supported Mr Macdonald's pre-selection. He said that Mr Macdonald had said this two or three times, "maybe a few more". [110] He said that in the same context Mr Macdonald had also said words to the effect of, "we aren't friends". [111] He said that Mr Macdonald had said this once specifically, but that he had also said it two or three times in connection with Mr Maitland having not supported his pre-selection. I do not regard this evidence as admissible against Mr Maitland. 9. Mr Coutts described Mr Maitland as having "unfettered access to the Minister". [112] However, he clarified this to mean access to the Minister's office, rather than direct personal access. [113] He said that they reacted to each other in a "warm and friendly fashion". He also observed that on occasions when Mr Maitland was invited to events involving the Minister, Mr Macdonald would take him aside and engage in private conversation. [114] He immediately followed this by saying, "[h]e would seek Mr Maitland's advice on matters relating to the mining industry" [115] such that it was not clear whether this related to the "private" conversations and consequently, if it did, what was meant by private in the context of what were presumably large industry gatherings. At this trial, Mr Coutts added that he understood their relationship to be a professional one. [116] 10. Perhaps the strongest evidence of a friendship came from Mr Maher who said the pair were "very friendly to each other and enjoyed each other's company". [117] He said "lunches and dinners were long" and that they enjoyed telling stories and swapping jokes. [118] He said that Mr Macdonald hosted a function in the Strangers' Dining Room at Parliament House for Mr Maitland's retirement, but Mr Macdonald did not attend for a reason Mr Maher could not recall. [119] Mr Maitland also gave evidence that Mr Macdonald did not attend this function (although I note Mr Maitland gave evidence that Mr Macdonald attended another one of his retirement functions at a restaurant arranged by people connected with the union). [120] With respect to this Mr Iemma said it was not unusual for a Labor minister to host a dinner at Parliament House for a senior union official. [121] Mr Maher accepted that his evidence was based on "passing observations" and that he had not seen Mr Macdonald and Mr Maitland socialise outside union or Labor Party events. [122] Mr Macdonald in his evidence given in 2017, and Mr Maitland in evidence at this trial, denied any significant friendship. 7.1.5 Conclusion as to motive 1. That Mr Macdonald expected that he would retire, is of some relevance to the Crown case. It is clear that Mr Macdonald expected his tenure as a parliamentarian to come to an end in 2009. Further, the timing was not of his choosing, he being effectively forced into a compromise. On the Crown case, with the end of his parliamentary career in sight, he was motivated to secure his future, and did so by providing a favour to Mr Maitland, with an expectation that he would be repaid in some unspecified way sometime in the future. Mr Macdonald was not a young man and had served a lengthy time as a parliamentarian. Most people retire without considering the need to resort to criminal activity in order to fund that retirement. While his retirement was to be earlier than he would have liked, in the absence of any evidence of any specified return, the asserted motive involves a significant element of speculation. 2. With respect to the evidence of friendship, that Mr Macdonald and Mr Maitland may have been on friendly terms in the course of their professional dealings does not itself establish the existence of a meaningful friendship. There is no evidence of any interaction outside a professional context. There is no suggestion that either had been to the home of the other or that they had met each other's families, with the exception that Mr Macdonald brought his daughter to the meeting at Catalina Restaurant on 15 December 2008. This event is discussed below. It is sufficient for present purposes to note that this event marked the end of the process and this timing and the nature of the interaction provide no real support for the existence of a friendship as a motive for engaging in the process up until that point. While Mr Macdonald's denial of any friendship in statements to Mr Gibson suggests an attempt to distance himself from Mr Maitland, it does not prove that they were friends. Insofar as it might be seen as an attempt by Mr Macdonald to distance himself from Mr Maitland, it is, potentially, a form of admission by conduct. However, it was not isolated by the Crown as a lie, or otherwise (having regard to its repetition), conduct available as evidence of consciousness of guilt. [123] In these circumstances, it should be put to one side. 3. There is no evidence of any communication between the two men outside meetings at official functions and meetings organised through Mr Macdonald's office. Mr Macdonald did accept, in cross-examination, that there had been a "corridor discussion" with Mr Maitland immediately after the meeting of 5 November 2007 with the University of Newcastle, about the need to develop a business plan for the mine. [124] This was in the presence of Mr Coutts and others. While Mr Coutts did not suggest the conversation was in the corridor he also gave evidence of a conversation immediately after the meeting. He said that Mr Macdonald told Mr Maitland something "along the lines that you need to get support from industry, you've got some support, you need to get out there now and get some of the key players to back your proposal up and say that it's a good idea". [125] While this is relevant to the Crown case as to a "strategy" and is discussed below in this context, it is of some significance to the nature of the relationship between the accused. That is because it suggests that even a statement of this nature, in which Mr Macdonald is giving advice to Mr Maitland as to how to get his proposal across the line in a manner consistent with what the Crown says was their strategy, was made in the presence of a senior officer of the Department, especially one who was against the proposal. 4. The evidence establishes the accused got on well. Further, while they enjoyed a professional relationship, the scheduling of various meetings in restaurants, while at times convenient for Mr Macdonald, suggests Mr Macdonald, at least, was motivated to meet Mr Maitland in a more convivial environment, suggesting that he enjoyed Mr Maitland's company beyond purely professional interactions. But enjoying or even seeking out the company of another is not a sound basis from which to infer a willingness to abuse ministerial obligations. On the issue of friendship, I am not able to find the existence of a relationship of sufficient closeness that I could rely upon it as providing a motive for Mr Macdonald to engage in serious misconduct for the benefit of Mr Maitland. 5. If I were to find that the other evidence established that Mr Macdonald misconducted himself, I would be inclined to find that he did so, conscious of his impending retirement and in the expectation of some return, based on, if not friendship, then at least trust that the favour would be repaid sometime in the future. But this is to put the cart before the horse. Ultimately, the evidence of motive is so uncertain that I do not regard it as probative of guilt. 7.2 The motivations of the accused 1. While the Crown asserted a motive on the part of the accused, each of the accused asserted their own, lawful, motivations for engaging in the conduct the subject of the charged offences. 7.2.1 Mr Maitland's motivations 1. While Mr Maitland is the alleged accessory, he was source of the application for consent to apply and the application for the exploration licence. It is convenient to deal with his motives first. 2. As noted above, while Mr Maitland had retired from the CFMEU, it can be accepted that his personal views had not changed as a result. I have set out above his history. There can be no doubt that Mr Maitland had a distinguished history in the industry. Indeed, he received an Order of Australia Medal on 27 October 2010 for service to industrial relations in the mining sector. [126] He also gave evidence that he had no criminal record, with the exception of a conviction of giving false and misleading information to the Independent Commission Against Corruption (ICAC). [127] In relation to this, he explained that no one is allowed to inform anyone that they have been involved in an ICAC investigation but he had told a person over the phone that he was required at ICAC. He said he had had a couple of glasses of wine before the call as he had just found out his nephew and his nephew's wife had been found dead. He said he could not recall this conversation when giving evidence in ICAC. His evidence in this regard would appear to be inconsistent with a plea of guilty to what I assume was an offence against s 87 of the Independent Commission Against Corruption Act 1988 (NSW), which includes as an element that the person knows the evidence is false or misleading or does not believe it to be true. Mr Maitland was, however, not challenged in this regard and the issue was not otherwise explored. For this reason, it is appropriate that I give Mr Maitland the benefit of good character both as to his motivation in pursuing the relevant approvals, an absence of any intention or awareness Mr Macdonald would engage in wrongdoing, and also when assessing his evidence. 3. In his evidence, Mr Maitland said his motivation for pushing forward the proposal included his long commitment to health and safety and that he saw this "as another way of demonstrating a commitment to an industry that had provided him" with a good living and to which he owed something. [128] He said his motivation was informed by the experience of having worked with miners who had lost their lives due to accidents. [129] As noted above, Mr Maitland tendered the Wran report. [130] He explained that Mr Wran had been asked to examine health and safety in the mining industry in New South Wales following what was known as the Gretley disaster in which four miners were drowned. The Wran report came down in 2005 and was critical of the health, training and safety performance of the New South Wales mining industry. This led, amongst other things, to Mr Macdonald establishing the Coal Competence Board and revamping the MSAC. The Wran report and the changes that resulted were clearly significant industry events. Mr Lewis commented that, around this time "everyone, particularly mine management, were very serious about trying to improve health and safety as a result of the fairly negative findings of the Wran report right across the industry". [131] He said the union also took up the challenge. [132] 4. Following his retirement Mr Maitland, in late 2006, met with Mr Ransley, Mr Poole and Mr Martin (who was previously part of Eastern Mining and Construction Company (EMC) but subsequently joined ResCo) as a result of an introduction from Mr Peter Murray (the then general secretary of the Mining and Energy Division of the CFMEU). He was informed Mr Ransley and Mr Poole proposed to establish a new mining services company which was safety and health conscious and union and employee friendly. [133] He was told that the reason for the approach was that he had a good reputation within the industry for pursuing health and safety issues. [134] He understood an obstacle to the company's objectives was the existence of a skills shortage in the sector. [135] 5. Mr Maitland explained that following this, in early 2007, ResCo organised a meeting with a geologist, Dr Palese, who provided information in relation to resources available in the Hunter Valley area. [136] I will return to the detail of these events. For present purposes it is sufficient to note that Mr Maitland said the idea of a training mine arose before the meeting with Dr Palese; it was intended that Dr Palese would look at the possibility of securing an area for a training facility or training mine. [137] At this point, the commerciality of the idea had not been considered. Mr Maitland said that Dr Palese identified the Doyles Creek area as an area that had potential. According to Dr Palese, the area had been overlooked by the major mining companies, due to various difficulties in that it was near the Jerrys Plains township, on the river flats of the Hunter River and adjacent to an escarpment (which makes mining more difficult and costly), [138] and thought to possibly have some geological disturbances. [139] Dr Palese, however, said there could very well be some valuable coal resources in the Doyles Creek area. [140] Essentially, the tenor of the evidence, was that as the area was perceived as having difficulties by those that would otherwise have exploited it for purely commercial objectives, it might be suitable for a company such as ResCo with broader objectives. In order to demonstrate that their project stood apart from others, it was decided to approach well established institutions around the Hunter Valley. 6. I interpolate here that the State has an interest in allowing the extraction of resources where they would not otherwise be mined. The State owns the minerals, and consequently receives royalties from mining companies that extract them (in addition to any money they may receive as a result of a company bidding for a resource). Where mining companies are not sufficiently interested to bid for a resource there is an interest (subject to any countervailing considerations such as environmental impact) in at least obtaining the royalties. 7. With respect to the approvals, Mr Maitland said that he could not think of any reason why Mr Macdonald would owe him any type of debt or favour. He said he was determined to obtain the consent. [141] He lobbied him as hard as he could but never met him one-on-one and had no private discussions in the lead up to 15 December 2008. He said there was no reason for him to think that the granting of consent to DCM was criminal; respected people were involved in putting the application together, the Minister himself had expressed interest in this project and he did not have a relationship with the Minister. [142] There was a significant body of independent evidence which confirmed Mr Maitland's interest in mine safety and his belief in the merits of an underground training mine. Mr Cameron, through his knowledge of Mr Maitland, agreed that he was a very strong proponent in favour of improving safety in the underground mining industry, but noted that he thought everyone was similarly minded. [143] Mr McPherson agreed that Mr Maitland had been a strong advocate for a training mine from the time he had met him. He said Mr Maitland raised it every time he met him. [144] (Mr McPherson entered the industry in 2000.) Mr Mullard had previously described Mr Maitland as having a "bee in his bonnet" about wanting to start a training mine. [145] Mr Lewis said that Mr Maitland, during the whole of the 20 years that he had known him, was seen as a proponent of the prosperity of the industry and improved health and safety. [146] 8. While it is clear that Mr Maitland had long been a supporter of an underground training mine, it is also important to note that this was not an idiosyncratic view peculiar to him. Mr Buffier was well qualified to give an opinion and agreed that there are advantages to a training mine. He said, with reference to the tasks required of miners, that "simulation will help you but it is important to get that [in]-the-ground training". [147] Mr Robert Cameron AO, the Chairperson of Centennial Coal, said in a statement to the ICAC that a training mine, where there are not the usual pressures in relation to production, would be a great adjunct to any training, and something that, if it was "commercially available and conveniently located to us", his company would seriously look at utilising. [148] In a similar vein, Mr Lewis gave evidence of the difficulty in supervising trainees in a production situation where there are pressures on output. He said he had always supported the concept of a separate training mine. Indeed, Mr Lewis said that, having worked in the industry for a number of years, he left Xstrata having decided to take a break, but that Mr Ransley was able to talk him into joining ResCo, in part because he was extremely interested in the training mine proposal. [149] 9. Mr Lewis and Mr Poole additionally gave evidence that their interest in establishing a training mine went beyond New South Wales. After the exploration licence was granted, ResCo established a company called Springsure Mining Pty Ltd to establish an underground training mine in Queensland. The shareholdings were not identical but the majority of DCM shareholders were also shareholders in Springsure. [150] Springsure subsequently applied for an exploration permit in Queensland, the application noting that Springsure intended to construct a training mine facility in the Bowen Basin. [151] Mr Poole said this was a genuine attempt to help with safety and health conditions in the industry. [152] It is clear, however, that it was also anticipated to assist ResCo with its labour hire business in Queensland. [153] 10. The evidence referred to above was also consistent with the support letters relied on at the time. It is clear that there was support for an underground training mine from a number of participants in the industry beyond Mr Maitland and Mr Macdonald. 7.2.2 Mr Macdonald's motivations 1. Mr Macdonald said that as the Minister responsible for mine safety under the Act, he was interested in the concept of a training mine. Mr Macdonald had confirmed publicly a government commitment to zero fatalities or serious injuries in the industry. [154] As minister he had received the Wran report and appointed Dr James Macken AM to constitute a Board of Enquiry into Mine Safety Enforcement Policy in February 2007 pursuant to a recommendation of the Wran report. [155] Also in response to the Wran report, he passed the Coal Mine Health and Safety Act 2002 (NSW), which established the Coal Competence Board. He "revitalised" the old Mine Safety Council with the appointment of a new independent chairperson and two independent experts in Occupational Health and Safety. [156] 2. Mr Macdonald said there had been a long period with no deaths in the industry but that in the period prior to meeting Mr Maitland and Mr Ransley in July 2007 there had been some fatalities. He said that a training mine could meet a need, particularly in relation to "cleanskins" going into the labour hire side where there might be gaps in their training and that a training mine would add to any virtual reality type training. He said "a real hands-on experience in a training mine, I believed, would enhance mine safety in New South Wales". [157] 3. Mr Iemma said that Mr Macdonald was passionate about his job, committed, energetic in his duties and spoke with genuine enthusiasm on the issues and policies in his portfolios. He took time to get across his brief, he spoke well in Parliament and he was knowledgeable about and interested in issues to do with rural and regional New South Wales, including mining, regional development, agriculture and primary production. [158] Mr Macdonald was involved in projects related to cleaner electricity generation, such as the Clean Coal Fund and the Snowy Hydro cloud seeding project, and he was a strong supporter of providing grants and undertaking research on clean coal and carbon capture. [159] 4. Mr Iemma said that Mr Macdonald was concerned generally about work safety and in particular, mine safety. Mr Iemma explained that the government at the time was facing severe financial challenges and a projected shortage of electricity in a decade's time, and that the expansion of coal production was regarded as integral to resolving both policy issues. Mr Iemma understood Mr Macdonald's concerns about mine safety to have been informed by this context. [160] 5. Dr Sheldrake was in contact with Mr Macdonald through his role as Director-General of the Department. Prior to being appointed to that role in 2008, he had acted as either a Deputy Director or Director of various departments that ultimately became part of the DPI and had worked with Mr Macdonald as a result of those various positions. He said that he had, through this experience, observed Mr Macdonald to keep in close contact with key stakeholders such as the New South Wales farmers, the Thoroughbred Breeders Association, Recreational Fishers and the Forestry Production Association. He said that Mr Macdonald maintained a friendly and professional relationship with those groups. [161] 6. There was, additionally, evidence Mr Macdonald was concerned about a skills shortage, particularly in the mining industry. The mining industry was a significant source of revenue for the State government. Access to suitably trained workers was essential to the efficient running of the industry and, in turn, a benefit to the State budget but also through employment (both direct and indirect), a benefit to the public more generally. 7. The evidence satisfies me that Mr Macdonald had a genuine interest in improving safety in underground coal mining. 8. The case in detail: Part 2 – Mr Macdonald - his role, responsibilities, and the allocation of coal 1. It is convenient, at this point to first consider the case against Mr Macdonald, he being the alleged principal offender. I begin with a consideration of his role and responsibilities before turning to more general evidence with respect to the allocation of coal resources at the time. 8.1 Mr Macdonald, his position and ministerial responsibilities 1. Mr Macdonald was, at the time of relevant events, a member of the Legislative Council in the NSW Parliament and a minister in the Labor government. The various offices held by Mr Macdonald were not in dispute. Agreed facts tendered in the case of each accused established the following: [162] "1. Ian Macdonald was a member of the NSW Legislative Council between 19 March 1988 and 7 June 2010. 2. Ian Macdonald was the Minister for Mineral Resources between 3 August 2005 and 5 September 2008 and 8 September 2008 and 17 November 2009. 3. Ian Macdonald also held the following positions between 19 March 1988 to 7 June 2010: a. Minister for Agriculture between 2 April 2003 and 3 May 2004; b. Minister for Fisheries between 2 April 2003 and 3 May 2004; c. Minister for Primary Industries between 3 May 2004 and 5 September 2008 and 8 September 2008 and 17 November 2009; d. Minister for Natural Resources between 3 August 2005 and 2 April 2007; e. Minister for State Development between 2 April 2007 and 5 September 2008 and 8 September 2008 and 17 November 2009; f. Minister for Energy between 2 April 2007 and 5 September 2008 and 8 September 2008 and 14 September 2009; g. Acting Minister for Small Business between 4 November 2008 and 11 November 2008; h. Minister for Mineral and Forest Resources between 8 December 2009 and 5 June 2010; i. Minister for State and Regional Development between 8 December 2009 and 5 June 2010; j. Minister for the Central Coast between 8 December 2009 and 5 June 2010; and k. Minister for Major Events between 11 March 2010 and 5 June 2010. 4. Ian Macdonald joined the Australian Labor Party in 1972. He continued as a member of the Australian Labor Party during his time as a member of the NSW Legislative Council." 1. As a minister of the government operating within our Westminster system, Mr Macdonald had significant responsibilities. Substantial evidence was given in relation to the obligations of a government minister including the obligation to exercise ministerial powers for the benefit of the State of New South Wales. An extract from the Ministerial Handbook produced by the Department of Premier and Cabinet and extant at the relevant time was tendered, as was the then relevant Code of Conduct for Ministers of the Crown. [163] There was evidence as to the induction of new ministers. Ultimately, however, this evidence was subsumed by the evidence of Mr Macdonald in which he accepted that "Ministers will perform their duties honestly and in the best interests of the people of New South Wales" and that this is the overriding duty. [164] He accepted that that included the exercise of any powers under the Mining Act. Additionally, Mr Macdonald accepted that as a minister he was obliged not to use his position for his own private gain or for the improper gain of any other person. [165] 2. It is also important to observe that a key component of the Westminster system is a permanent public service. The public service has a responsibility to advise government ministers and to implement government policy. Advice given to ministers by the public service is just that – advice. It is open to a minister to reject, or act contrary to the advice of her or his department. Mr Della Bosca supported this view and said that there would be nothing unusual about a minister not proceeding with a recommendation or advice from the Department, although he clarified that a minister would still certainly consider the departmental advice very carefully. [166] However, whether making a decision based on advice or contrary to advice, the minister's obligations remain the same. In the present case, there can be no issue that as a minister, Mr Macdonald was obliged to exercise his powers for the benefit of the State. Further, there can be no issue that he was aware that this obligation had the result that the exercise of ministerial power for the purpose of benefiting the private interests of Mr Maitland would amount to misconduct. 3. As the Minister for Mineral Resources between 3 August 2005 and 17 November 2009, Mr Macdonald had responsibility for the administration of the Mining Act. [167] The powers given to the Minister under the Mining Act could, of course, only be exercised in accordance with the obligations referred to above. 8.2 The decision to grant consent to apply 8.2.1 The decision 1. As observed above, on 21 August 2008, Mr Macdonald granted DCM consent to apply for an exploration licence over the Doyles Creek area. Proof of count 1 requires the Crown to prove that this was not a legitimate exercise of ministerial power. In particular, count 1 turns on proof that the driving force behind Mr Macdonald's decision to grant the consent was to benefit Mr Maitland and DCM such that, but for this purpose, the consent would not have been granted. 2. At the relevant time, s 13(4) of the Mining Act provided that an application for an exploration licence in a mineral allocation area could not be made except with the consent of the Minister. With respect to coal, the whole of New South Wales was a mineral allocation area meaning that the Minister's consent was required before an application for an exploration licence could be made. [168] The consent was granted by direct allocation to DCM. 3. The decision to grant consent was a culmination of a process which began in January 2007, leading to a formal application made in March 2008, multiple departmental briefing notes and numerous meetings. There is, however, no evidence of any private meeting or communication between the accused. Nor is there evidence upon which the Crown can rely as to any particular benefit Mr Macdonald was to receive. These matters are not fatal to the Crown case. They do, however, mean that careful analysis is required of the circumstances leading to the grant of the consent and the extent to which those circumstances are capable of supporting the conclusion urged by the Crown. 8.2.2 The significance of a decision to grant consent to apply 1. Despite the preliminary sounding nature of the application, the decision to grant consent to apply for an exploration licence was of critical importance. The usual course was that, if consent was granted, an exploration licence followed (assuming it was sought). Mr Mullard explained that the process was "largely an administrative" one conducted by the Department. He explained that there was a form to be completed, security deposits were required and that the applicant had to set out the proposed exploration program and establish their financial capability to undertake that program. [169] Provided the form was completed satisfactorily the exploration licence would be granted. This was consistent with the understanding of Mr Lewis, a person who has had experience as the Managing Director of ASX listed companies in the coal industry. He said that once you get an invitation to apply, provided you fill out the paperwork correctly, you would get the exploration licence. [170] Unlike the decision to grant consent, the decision to grant the exploration licence was delegated to the Department. While this reflects the different nature of the decisions, it was also the case that many decisions in relation to the granting of an exploration licence were referred back to the Minister. [171] 2. Of course, it must also be understood that a grant of consent to apply was not an automatic path to riches. The consent and the exploration licence that would typically follow provided the proponent with no more than a right to explore. There is, no doubt, that such exploration is expensive and involves risk. That is, exploration, typically by drilling, is costly, and there is no guarantee of any return on that expenditure. Mr Maitland said that an exploration licence gives the company "a commitment to spend a lot of money" and that the company has to raise the funds necessary for the exploration, in order to establish whether or not it is actually a valuable resource. [172] Apart from raising funds, Mr Lewis gave evidence that before commencing exploration, the company has to get landholder approval to go onto the property to undertake the drilling (assumedly unless the company is, or becomes, the landholder). [173] Mr Maitland also stated on multiple occasions that the shareholders could lose lots of money if the company ultimately finds nothing of value. [174] Mr Poole gave evidence to the same effect. [175] Mr Lewis provided an example of an exploration licence owned by NuCoal Resources NL (NuCoal) which "ha[d] proven worthless" after they had spent seven or eight million dollars in drilling as they discovered that the coal had been degraded by igneous intrusions. [176] Mr Maitland, however, did accept that the issue of an exploration licence increases the value of the company as it provides a basis to attract more investment. [177] 3. Even assuming the exploration is successful and coal is found, there is no automatic right to mine that coal. Mr Mullard gave evidence that after exploration, the holder of the licence would need to lodge a development consent application with the Minister for Planning, and upon receiving consent, would be granted a mining lease by the Minister for Mineral Resources, which would enable them to mine the coal. [178] In order to obtain development consent, the applicant would need to prepare, amongst other things, an environmental impact statement. The process for obtaining development consent involves public participation. [179] There would also be a need to raise sufficient funds to build the mine. [180] 8.3 The coal allocation committee and the guidelines 8.3.1 An overview of the allocation of coal resources 1. As observed above, the mineral resources of New South Wales are owned by the State. Mr Coutts described the Department's role as "principally steward [of] the State's resources". [181] That role was, of course, necessarily carried out consistently with the Department's obligation to implement the policy and decisions of the government of the day. 2. Mr Mullard explained that the entire State had been declared a "Mineral Allocation Area" with respect to coal. [182] While this occurred in December 2007, the Hunter Valley area, where Doyles Creek was located had been declared a mineral allocation area prior to this. The result was that at the time of both ResCo's first application for consent in February 2007 and DCM's application for consent in 2008, no application for an exploration licence for coal in the relevant area could be made without the consent of the Minister. 3. Within the Department, there was a Coal Allocation Committee, made up of members from different branches of the Department. The Committee would consider applications for consent and provide recommendations. The Committee might recommend a competitive process but could also recommend a direct allocation. Mr Mullard explained that a direct allocation was "where the Minister invited a specific company to apply for an exploration licence for coal". [183] 4. Mr Mullard said that in coming to any recommendation the Committee would consider the Department's "coal allocation guidelines", and also consider whether any application had previously been made with respect to the area. Mr Mullard explained that the existence of previous applicants indicated that there was strong interest in the area which, in turn, meant that the area was potentially suitable for an expression of interest or a tender process rather than a direct allocation. Mr Coutts gave similar evidence. [184] 5. As observed above, once consent to apply for an exploration licence was granted, the granting of the exploration licence was essentially an administrative process. Mr Mullard explained that such a licence gave its holder an exclusive right to explore for the particular mineral. It did not give the right to mine the resource. The holder would undertake exploration and, as part of that, might undertake feasibility studies or various environmental studies for the purposes of preparing an environmental impact statement. That would then be provided to the Minister for Planning for the purpose of obtaining development consent to allow mining to take place. [185] 6. While, as indicated above, the approval of the mine was dependent on obtaining approval from the Department of Planning, the Department endeavoured to pre-empt that stage of the process. That is, as Mr Coutts explained, the Department would, before going through the process of encouraging an application for an exploration licence, seek comfort that the proposal was likely to get through the whole processes of government. To that end he said "there was a fairly rigorous process within Government to try and make sure that by the time a proposal got to the Department of Planning seeking development consent that all the various issues had been thought through". [186] 7. Mr Mullard explained that the nature of coal is such that, unlike other minerals, there is a broad understanding of where it is located. What was not known was how effectively that coal might be mined, or its quality. Mr Mullard explained that the Department had a program of exploration in order to identify resources to provide information to mining companies. He said that "[d]epending on where it was, we did have a program of releasing areas for expressions of interest". [187] This resulted in a competitive process for the resource. 8. Mr Coutts said that the: [188] "… default position would be to allocate on a competitive basis. A direct allocation would occur when it didn't make sense because there was existing infrastructure already in place, and it may have been appropriate for a resource to be allocated to an existing mine … There may well have been a mine in place that had all the necessary infrastructure, and to access a resource adjacent to that mine, to put the infrastructure in place, would have either made no economic or environmental sense so, therefore, you may well have given a direct allocation. On a probably more common basis, you may have done a direct allocation when the resource was of a very minor nature. In other words, small remnant tonnages which the existing mine could basically scrape up and add to their own mine operation." 1. Mr Mullard said, with a perhaps slightly different emphasis, that "the competitive process was normally only applied where there was a substantial coal resource that was effectively what we termed a stand-alone project" [189] by which he meant the project was of sufficient size and scale to justify the infrastructure for a new, stand-alone, mine. 8.3.2 The guidelines 1. The above observations were made in the context of the applicable guidelines. Guidelines in relation to coal allocation were approved by Mr Macdonald as Minister on 3 May 2006. [190] The ministerial brief indicated by way of background that previously, only major open cut coal deposits were subject to set "front end" payments at the time of the grant of the exploration licence or the grant of the lease. The brief indicated that following the Caroona allocation the proposed guidelines had been updated to include provision for financial contributions for all future coal allocations, that larger locations will normally be by competitive tender or expression of interest and that small areas would be by direct allocation or a limited expression of interest. Small areas would include a set financial contribution, payable on development approval, rather than as a front end payment. The guidelines were updated in January 2008. [191] In the updated version the introduction was amended to state that, following a recent order of the Governor, all coal deposits in New South Wales now lie in a "Minerals Allocation Area" under the Mining Act. This had the result that, pursuant to s 13(4) of the Mining Act, no application for an exploration licence for coal anywhere in the State could be made without consent to apply first being granted. This did not affect the present case as the area sought at Doyles Creek was, prior to the January 2008 change, already in a Minerals Allocation Area. 2. The guidelines themselves did not change in any way relevant to this case when updated in 2008. They stated within the introduction that "normally allocations are made on a competitive basis, however, there may be circumstances where coal allocations are made subject to certain conditions and including a financial contribution". The guidelines then categorised coal allocation areas into four groups: [192] "(i) Major Stand-Alone Areas These areas contain sufficient coal to develop a large new mine. (ii) Substantial Additions to Existing Mines These areas are located adjacent to existing mines and could be mined from a continuation of the existing operations. Such areas may also have the potential to be 'major stand-alone' areas. (iii) Minor Additions to Existing Mines These areas are small areas adjacent to existing mines and could be mined by a continuation of the existing mine. These areas are not large enough to develop 'major stand-alone' mines. (iv) Small Areas Unrelated to Existing Mines These areas are small but may have the potential to be developed as stand-alone mines if located close to infrastructure or markets." 1. A major stand-alone area was defined as "an area containing sufficient coal to justify the establishment of a substantial new mine and infrastructure". [193] The guidelines did not otherwise define the amount of coal that constitutes "sufficient" for the purposes of this category. The guidelines indicated that such areas would be allocated by: [194] "(a) Tender or expressions of interest with open-ended financial contribution. (b) Tender or expressions of interest with minimum financial contribution but open-ended maximum contribution. (c) Tender or expressions of interest with a fixed financial contribution and a requirement to develop specific infrastructure or utilisation technologies or value adding processes. (d) Tender or expressions of interest to supply a specific end use such as a domestic power station with a financial contribution negotiated in advance of the tender or expression of interest." 1. The Coal Allocation Guidelines provided for indicative minimum financial contributions. These contributions were based on the size of the resource with a dollar figure per tonne which varied depending on whether the mining was open cut or underground (due to the increase in efficiency involved in open cut mining), whether it was domestic or export (the latter being more valuable), and the size of the mine (based on efficiencies of scale). The size categories reflect what the Department generally understood to constitute a small, medium or large resource. [195] Mr Mullard explained that under 50 million tonnes was considered small, between 50 to 100 was medium and over 100 was a large resource. There was some debate as to whether the DCM application in March 2008 related to a large mine, given the application was based on an estimate of 91 million tonnes of coal. That would be a medium sized resource according to Mr Mullard's explanation for at least some purposes. However, irrespective of the use of the word "large", in relation to "Major Stand-Alone Areas" in the part of the guidelines set out above, it was accepted, including by Mr Macdonald, that the area applied for was a major stand-alone area within the definition subsequently provided by the guidelines, based on there being "sufficient coal to justify the establishment of a substantial new mine and infrastructure". [196] In relation to major stand-alone areas, as can be seen in categories (a) and (b), it was open to an applicant to offer an AFC as part of their bid. This would be taken into account as part of the applicant's bid package (together with an evaluation of other aspects of the bid including matters such as the exploration budget). 2. In relation to major stand-alone areas falling within (c), Mr Mullard explained that a company may wish to access a coal resource as part of the development of another project. He gave the example of a company involved in a project to convert coal into a fuel oil replacement. This project had a benefit to the State in the development of new technology, and the synergy between the mining and fuel oil replacement projects was such that a direct allocation was justified. In such a case a fixed financial contribution could still be negotiated with the Minister. [197] 3. Major stand-alone area category (d) was similar, covering a specific (and desired) end use such as domestic power stations. Power stations at that time were owned by the State. An allocation of coal under this category allowed for reduced cost to the miner, with that reduced cost to be passed on to the power station, and ultimately to the people of New South Wales. [198] 4. The guidelines also provided for the process of allocating in relation to categories (ii) to (iv). The provisions in relation to existing mines were explained by Mr Mullard as covering situations where the resource logically could only be mined by a particular company, with the result that the company had effectively captured that resource. Mr Mullard noted that in these circumstances the guidelines allowed scope for a negotiated outcome. In relation to small areas unrelated to existing mines the guidelines provided for allocation "by priority or some limited form of expression of interest". There is no suggestion that the guidelines for categories (ii) to (iv) were relevant to the allocation in question – the proposal was neither for an addition to an existing mine, nor for a "small" area. 8.3.3 Other areas allocated by direct allocation 1. There was no issue that the Minister had the power to grant consent to apply, and ultimately an exploration licence, by direct allocation, rather than by the alternative of a competitive process (that is, expressions of interest or tender). The guidelines themselves (which did not bind the Minister) allowed for the possibility within the introduction in stating "normally allocations are made on a competitive basis, however there may be circumstances where coal allocations are made subject to certain conditions, including a financial contribution". [199] 2. Mr Mullard gave evidence that the allocation process for major stand-alone areas did not necessarily result in the payment of AFCs or a competitive process. He gave an example of a direct allocation of an exploration area at Mt Pleasant to allow "conversion of that coal resource into a major new development", with the benefit to the State being not only the development of the coal mine, but also the development of new technologies for the export of fuel oil replacements. [200] 3. Mr Macdonald gave similar evidence. He said that the exception to a competitive process provided by the guidelines would generally operate where there was a public benefit attached to the allocation. [201] There were other examples in the evidence of direct allocations of major stand-alone resources. 4. In March 2009, Mr Macdonald, together with the Treasurer, Mr Roozendaal MLC sought the endorsement of the Budget Subcommittee of Cabinet to grant an exploration licence in relation to a proposed mine at Cobbora by direct allocation. [202] Mr Mullard confirmed that it was in relation to a major stand-alone area. [203] The proposal was for the private sector to develop, construct and operate a coal mine for the purpose of supplying coal to State-owned generators. The business case indicated that the allocation was intended to ensure security of supply into the future in the face of increasing risks with respect to supply. Mr Mullard gave evidence that there was a substantial public benefit. [204] 5. A company called Shield Energy was given, by direct allocation, consent to apply in February 2007 in relation to an area larger than that here. [205] This followed consideration by the Coal Allocation Committee and a recommendation to Mr Macdonald. Mr Mullard said it was an unusual deposit and was potentially going to be used for coal supply or conversion to oil. An earlier allocation had been made with respect to an area at Narrabri, [206] however, this predated the Coal Allocation Guidelines. Mr Mullard also said that it occurred before "things were heating up" by which I understand him to mean the increased price and competition for coal. It was also said that it was granted to create jobs and infrastructure in the particular region. 6. Evidence was also given of direct allocations in relation to small resources such as an allocation with respect to an inferred resource of 10 million tonnes in circumstances where mining was to be in addition to an existing operation and, I infer, would not otherwise take place. [207] The Department's advice was that the proposal met the criteria for direct allocation and was supported by the Department's Coal Allocation Committee. [208] The allocation of an area close to the area sought by DCM to a company called Peabody in February 2008 fell into a similar category and was similarly supported by the Coal Allocation Committee. 7. A document containing a list of direct coal allocations in NSW since 1988 (said to be a selection of such allocations) was tendered by Mr Maitland, and specifically relied on by Mr Macdonald. [209] 8. The examples of direct allocation do not materially assist in determining whether the allocation in this case was not for a proper purpose. Further, the fact that the Department, which supported the above direct allocations, did not support the present application on its face establishes nothing more than a difference of opinion. At best, they give some insight into the processes and application of the guidelines. In the present case Mr Macdonald as Minister had the power to directly allocate the resource, but given the potential value (a matter to be discussed further in due course) there is a legitimate expectation that a process would be followed which would ensure that the State properly realised the benefit of that resource. While Mr Macdonald was entitled to come to a different view to that of the Department as to how this was to be done there is an expectation that he would take adequate steps with respect to the integrity of the process. A failure to do so may support the inference the decision was not made for a proper purpose. Thus, while acknowledging the existence of other cases of direct allocation, it is necessary to have closer regard to the particular circumstances of this allocation. 8.4 An overview of relevant administrative and advisory bodies 1. Outside the Department, there were a number of bodies involved in the coal industry available to provide advice or services. It is convenient at this point to set out in broad terms the functions of those various organisations. 2. Mr Macdonald in his evidence referred to "tripartite committees" within his portfolio, in that they were constituted by representatives of the unions, the employers and the Department. [210] These tripartite committees included the Coal Competence Board, [211] the MMAC [212] and the MSAC. [213] 3. The Coal Competence Board was a Board which commenced operation in June 2007 led by an independent Chair, who, at the time, was Mr Maitland (having been appointed my Mr Macdonald in January of that year), and had representatives from the CFMEU and the NSW Minerals Council, two independent experts and two members from the DPI. The role of the Board was to oversee the development of competence standards for people performing functions at coal operations that may impact on health and safety, to advise the Minister on matters related to such competence, and to undertake initial and ongoing assessments of the competence of people performing functions at coal operations. [214] 4. The MMAC was a body established by Mr Macdonald in 2005. [215] The key function of the MMAC was to provide the Minister with a high-level source of advice across all sectors of minerals and petroleum industries in relation to Government policies, legislation, regulation and services, to identify key areas which may require a strategic policy response for the Minister's consideration and develop strategies in response, and to advise on how to attract exploration and development investment. [216] The MMAC was chaired by Mr Papallo at the time and was made up of senior members of the resources industry. 5. The MSAC, formerly known as the Mine Safety Council, considered, and advised on, strategies to enhance mine safety performance in New South Wales, including skill and competency training required to improve safety performance in New South Wales mines. [217] The MSAC consisted of representatives from the industry and the union. [218] As noted above, following the Wran report, Mr Macdonald had "revitalised" the MSAC by appointing a new independent chair and two independent members with expertise in occupational health and safety and had tasked the MSAC with monitoring the implementation of the Wran report's recommendations. [219] 6. The NSW Minerals Council was an industry body established by member companies within the minerals industry, such as coal producers, to represent their interests to government in relation to policy, legislation and regulation related to the mining industry in New South Wales. [220] In other words, it was an industry lobby group. 7. The MCA was a business group that represented all resource activities in Australia, apart from oil and gas. The council represented all States and had very senior representation from most companies in the resource industry in Australia. [221] 8. Coal Services was established jointly between the CFMEU and the NSW Minerals Council. It was a statutory monopoly with three functions – mines rescue, the provision of health-related services and rehabilitation for injured miners, and workers compensation. The coal industry was required to insure with Coal Services. Coal Services also established a number of virtual reality training centres at various Miners Rescue Service Stations around the State. [222] 9. The case in detail: Part 3 – The context surrounding the grant of consent 1. In order to properly understand the context in which the relevant decisions were made, it is important to appreciate a number of matters of significance by way of background, in particular, the State's financial position at the time and the bids received in relation to two significant coal reserves in the Gunnedah basin – Caroona and Watermark. It is also useful to have an understanding of the existence of other interest in coal mining in the Doyles Creek area. These matters shed light on the factors, at least potentially, at play in the decision-making process now called into question by the Crown. 9.1 The State's financial position 1. On the Crown case, Mr Macdonald, in granting the consent, and ultimately the exploration licence, was forgoing at least the potential that the State may receive significant revenue by way of an AFC for the resource. The Crown contends that the financial position of the State at the time makes any decision to forgo, or to potentially forgo, revenue, inexplicable, thus supporting an inference that the decisions were made for an improper purpose. 2. Mr Iemma gave evidence in 2017 that the financial environment, from the time he became Premier in 2005 was "challenging" and remained so until he resigned in September 2008. [223] He said an audit of the State's financial position was commissioned and Cabinet was given presentations on this, including as to the results of the audit in 2006. Mr Iemma said there was a rigorous process of tracking performance across government as well as encouragement for ministers to give consideration to new ways of delivering services or infrastructure in their portfolios. He said that he emphasised very strongly when he became Premier that the government faced challenging financial circumstances. He said there were "pep talks about sticking to allocations" and ensuring strong budget and financial discipline "as a matter of course in the workings of Cabinet", reinforced by the Treasurer on a regular basis, and even more so by the Budget Committee. [224] He said, "the general issue of funding and budget discipline was central to the workings of the Cabinet". [225] 3. Mr lemma gave evidence that one of the recommendations of the audit was the implementation of an "efficiency dividend" which required the various State departments to make savings in an amount he recalled was about "one and a half percent". [226] It was the responsibility of ministers, with their Chief Executives, to determine how those savings were to be achieved, and to report back to the Budget Subcommittee. He said that Mr Macdonald spoke to him with concerns that the traditional method of achieving savings through the reduction of staff numbers would have a particularly adverse effect on his portfolio given the potential impact on employment in regional and rural New South Wales. He said that Mr Macdonald said that the DPI had been undertaking "a mapping" and that there was "significant potential through the State's resources to derive revenue" and that this was preferable to a reduction in costs through a reduction in staff. [227] He said Mr Macdonald sought permission to "explore proposals that would see areas put up for development in mining, and derive revenue through that source". [228] While the evidence was somewhat unclear as to when the various conversations took place, implementation of the efficiency dividend was not an issue until after the audit which was completed in 2006. Mr Iemma resigned on 5 September 2008, which provides some insight into the timing. 4. Mr Nathan Rees took over from Mr Iemma as Premier. As noted above this took place on 5 September 2008, by which time Mr Macdonald had already granted consent to apply to DCM. Mr Rees said that on taking over, "the overall budget position was in reasonable order but there were significant threats". [229] He said that there was a shortfall in State revenue of approximately $100 million a month with no apparent explanation. Ten days after being sworn in, Lehman Brothers collapsed sparking the global financial crisis. He said that Cabinet was told that the consequent variability of financial projections required scrutiny of expenditure. 5. The evidence of Mr Iemma particularly establishes that reducing spending and obtaining revenue were a significant focus within the government of which Mr Macdonald formed part. Of course, that is not to say that it was the only, or even primary, focus. It does, however, provide a context in which government decisions were being made, including those the subject of this trial. 9.2 Caroona and Watermark 1. Relevant to the State's finances and the Crown's contention that substantial revenue may have been forgone is the result of the process leading to the grant of consents with respect to two areas known as Caroona and Watermark. 2. Mr Mullard gave evidence that in 2006 to 2007, the demand for coal was growing and the Department was getting a lot of applications for coal allocations. In response to this, the Department looked at two areas that could be released for expressions of interest and identified Caroona, an area in the Gunnedah Basin, where the Department had previously done a lot of work. 3. An invitation seeking expressions of interest was released on 1 August 2005. That document identified the area and indicated it contained more than 500 million tonnes of in situ, potentially mineable underground coal with a further 500 million tonnes under alluvial plains and associated water aquifers requiring further study to determine its mineability. [230] 4. The expressions of interest were considered by an evaluation committee, including an independent probity auditor. [231] Each member declared an absence of any conflict of duty. The committee produced a report assessing the four expressions of interest, where each company was given a score in various categories: the exploration proposal, mine development, any AFC offered and other commitments (generally commitments to the community or environment). One concern was to maximise the resource. Thus, while it was an evaluative process, in general terms an exploration proposal with a large budget would be favoured over a proposal to test a smaller area or to spend less on exploration. A matter such as the amount of any AFC was capable of direct comparison. The individual scores were tallied to produce a final ranking. 5. On 17 February 2006, BHP Billiton was advised that they had been successful. Significant to the Crown case was their AFC of in excess of $91 million at the grant of the exploration licence, plus further staged payments of $50 million and $65 million upon commercial production from the second and third longwall operations respectively. 6. Mr Coutts said that the outcome of the tender provided a financial return "which was far in excess of anything that the department was expecting" and that "to say that quantum made us all incredulous would not be an overstatement". [232] 7. Mr Coutts said that Mr Macdonald was very excited stating "[t]his is a great result Alan, we'll have to see if we have got some more that we can put out". [233] Mr Coutts said that as a result he spoke to Mr Mullard to identify a suitable area. Mr Mullard recommended Watermark, an area adjacent to Caroona and where the Department had done a reasonable amount of work. Mr Coutts said that the expressions of interest comprised a detailed package, the principle being that the better the information available to industry, the better the likely result. In other words, the more that the Department was able to reduce risk to the interested parties, the stronger the likely bids. 8. Watermark was subject to a similar process to that described above in relation to Caroona. The invitation for expressions of interest was released in October 2007. [234] The deposit was described as containing in excess of 1 billion tonnes of in situ coal but noted that shallow resources underlying alluvial plains and associated water aquifers required further studies to determine its mineability. By letter dated 14 August 2008, Mr Macdonald invited China Shenhua Energy Company Limited (China Shenhua) as the successful applicant to apply for an exploration licence. This was based on a bid offering a financial contribution of approximately $300 million. [235] 9. Mr Coutts gave evidence that Mr Macdonald asked him on a number of occasions what the Department's expectations were for Watermark. He said he told Mr Macdonald that he "really had no idea". He explained: [236] "The problem was because of Caroona being so significantly above anything we had expected, it was very hard to really put a picture on what we thought we'd get for Watermark. My view at the time was probably if we got another $100 million bid we were doing pretty well so to get $300 million was, I don't think any of us expected that." 9.2.1 The significance of the Caroona and Watermark bids 1. It is not possible to equate the consents granted with respect to Caroona and Watermark with that granted for Doyles Creek. With respect to Doyles Creek, DCM's application for consent estimated the resource at 91 million tonnes. In terms of volume, it was clearly a significantly smaller resource. 2. Mr Mullard accepted that Caroona (an open cut 500 million tonne reserve) was potentially an exceptional resource for mining, but said that you could not simply compare the size of the resources. [237] He said that while Caroona was a large resource, it was necessary to take into account that Caroona was not located near infrastructure. [238] Additionally, he said that Caroona had thermal coal while Doyles Creek had some coking coal, which was more valuable, in addition to thermal coal. [239] He said a problem with Caroona and Watermark was the operational difficulties in getting the coal over the Liverpool Ranges and the fact that it was not near a workforce. In comparison, Doyles Creek was attractive because it was within the Hunter Valley, did not have the same rail constraints as mines in the Gunnedah Basin, and resultantly, had lower capital costs and easier access to a workforce. This meant that Caroona and Watermark required spending a lot more money to establish a mine compared to Doyles Creek. [240] On the downside in relation to Doyles Creek, the Hunter Valley was structurally complex, involving a range of geological issues, a potential need to manage gas within the coal seams, as well as environmental sensitivities requiring management. It should also be noted that in addition, Doyles Creek involved underground mining which was more expensive and less efficient than the open cut mining anticipated at Caroona and Watermark. Mr Mullard did, however, observe that despite the structural complexity, very successful underground mines had been established in the Hunter Valley region. 3. The extent of exploration was also a significant difference between Doyles Creek and the Caroona and Watermark areas. Ms Moloney gave evidence that the Department conducted thousands of metres of drilling in the Watermark and Caroona areas to "prove up" those resources. [241] The Caroona Expression of Interest information package indicates that there were 56 cored and non cored bore holes within and adjacent to the Caroona area. [242] The Watermark information package indicates that there were 55 cored and non-cored bore holes in the area. [243] By comparison, the Department had drilled only four (or possibly five) holes in the Doyles Creek area in the 1970s and 80s. [244] 4. Mr Mullard was asked to give an opinion as to what might have been received had Doyles Creek gone to tender. He based his opinion on his experience, including the results for Caroona and Watermark, that the coal price was high and projections were that it would stay high. His opinion was that the Doyles Creek allocation would have attracted between $50 and $100 million dollars as an AFC. [245] 5. Without, in any way, being critical of Mr Mullard, I would not place weight on this opinion. In saying this, I do not suggest it was wrong. Rather, there is no suggestion that he informed Mr Macdonald (or Mr Maitland) of this opinion and it therefore cannot have been relevant to Mr Macdonald's decision. Apart from this, I would also accept that there were significant differences between the areas, making comparison difficult. Mr Macdonald's assertion that, quite apart from the training mine, he saw no similarities between Caroona and Watermark, and Doyles Creek is not without foundation. [246] 6. Despite the above, the bids received with respect to Caroona and Watermark are, nonetheless, to my mind, significant. 7. Mr Macdonald wrote to Mr Costa a letter dated 2 June 2006 regarding the AFC of $100 million (as described in the letter) resulting from the BHP Billiton expression of interest in relation to the Caroona coal exploration licence. [247] In that letter he noted that it was the first time an expression of interest had sought an AFC and that as a result of the success of this process he had approved updated guidelines for the allocation of future coal exploration areas (the May 2006 guidelines). Mr Macdonald noted that the guidelines would result in the State receiving a significant contribution from allocations which had been granted without a direct financial contribution and requested that the Department receive a "small portion of these payments to cover overhead and management costs". Additionally, Mr Macdonald observed that future coal allocations were unlikely to produce such windfall gains and indicated his view that most future allocations will achieve less than $10 million. 8. Subsequent to the above letter, Watermark yielded the offer of a $300 million AFC. While that single event does not contradict the proposition that "most" future allocations would receive less than $10 million, what is significant is that the Watermark AFC exceeded all expectations, it seems, by a very significant margin, and did so on the back of Caroona having exceeded expectations. Mr Macdonald signed the letter dated 14 August 2008 granting China Shenhua consent in relation to Watermark. It was only one week later that Mr Macdonald signed the letter granting DCM consent. Additionally, Mr Macdonald acknowledged that he was aware of China Shenhua's bid at the time he was considering the Department's advice provided on 27 May 2008 in relation to the DCM proposal. 9. While the events surrounding Caroona and Watermark would not necessarily have informed Mr Macdonald what contribution may have been received for Doyles Creek had it gone to tender, he cannot have been unaware of the potential for a significant bid. Mr Coutts' evidence that Mr Macdonald asked him on a number of occasions what it was thought was likely to be received as an AFC for Watermark and his response that he "really had no idea", [248] highlights the uncertainty at the time around what coal companies were likely to bid for resources. It is clear that, at the time that consent was granted to DCM, the market was extremely competitive. The coal price was high. Mr Macdonald knew this and also knew that other companies were interested in the area. [249] The reality is that Mr Macdonald granted the consent not knowing what might have been obtained. Indeed, and in contrast with Mr Coutts' evidence as to Mr Macdonald's curiosity with respect to Watermark's potential (at [231), there was no suggestion in the evidence of any similar curiosity with respect to Doyles Creek. 10. With respect to the limited information available with respect to Doyles Creek, I note that this issue was specifically referred to in a cabinet minute sent by Mr Macdonald to Mr Iemma on 5 March 2008 seeking that Cabinet urgently consider the proposed extension of a programme called the New Frontiers Exploration Initiative. [250] Essentially it was a request for funding for exploration for the next three years. Significantly, it identified the return from the Caroona allocation, and identified, among other areas, Jerrys Plains as a "similar" area planned for allocation in the future, which was at risk in the absence of funding for exploration. The implication was that the area had, contingent on proper exploration, the potential to raise significant revenue. Similarly, in June 2008, a Cabinet minute was prepared by the Department seeking approval for funding to identify coal allocation areas for competitive tender release. While Mr Macdonald said this did not go ahead, [251] and Jerrys Plains is a larger area than Doyles Creek, these attempts to obtain funding confirm an awareness that Doyles Creek had, at least, the potential to return a significant AFC. Further, consistent with the evidence as to the State's financial position, Mr Macdonald said that after Caroona he was "desperate" to get another substantial AFC. [252] 11. To the extent that there was limited data available in relation to Doyles Creek, this did not support a direct allocation over a competitive tender process. There were two obvious possibilities. The first was to put the resource to market based on the information available. The second was to do nothing (or refuse the application). The Department's advice is discussed in detail below. For present purposes, I do not accept that the absence of any recommendation in this regard limited Mr Macdonald's powers, or that he would have understood that to be the case. For instance, in relation to the Department's briefing note of 22 February 2007, Mr Macdonald did not accept any of the recommendations but rather chose to do nothing, a course which was not specifically outlined in the note. 12. Mr Macdonald said that if the Department was confident of a substantial AFC with respect to Doyles Creek, "they would have potentially stated that". [253] He said that the Department around this time described the sort of money that could be expected from other projects as substantial, leading him to infer from the absence of any similar reference in the advice in relation to Doyles Creek that they did not expect a substantial return for this resource. The evidence, particularly having regard to the evidence of Mr Coutts was, however, that it was difficult to know. 13. The Caroona and Watermark bids are also significant with respect to the process. I find that Mr Macdonald was aware of the general nature of the process and, in particular, the presence of an assessment panel and an independent probity auditor as reported in the media (presumably based on a press release, but, in any event, admitted as part of the agreed tender bundle). [254] Mr Macdonald must have been aware that the subsequent process adopted with respect to Doyles Creek was very different. 14. As observed above, there were differences between the Caroona and Watermark areas and Doyles Creek. Not only were the respective areas' inferred resources very different (including the strength of such inferences), but the proposals were also very different. Most particularly, the DCM proposal was unique in its plan for an underground training mine. Nonetheless, the Caroona and Watermark bids are significant in providing an understanding of the climate in which consent was granted to DCM. The question is, of course, whether that significance, in combination with all the other evidence including the potential benefit of the training mine allows an inference of misconduct to be drawn to the requisite standard. 9.3 Interest in coal mining in the Jerrys Plains area 1. Prior to any application by ResCo, a number of companies had expressed interest in mining coal in the Jerrys Plains area. In accordance with the Department's processes, these applications were recorded on a register. Unsurprisingly, the areas sought by the various companies did not precisely correspond. A map was tendered on which the areas sought by each of the companies were overlaid for ease of comparison. [255] 9.3.1 Independent Coal Pty Ltd 1. On 18 December 2002, Independent Coal Pty Ltd (Independent Coal) made an application seeking consent to apply for an exploration licence. [256] The area sought, while not coextensive, overlapped to a significant extent with the area subsequently sought by DCM. The application made reference to the complexity of the local geology but indicated that Independent Coal may identify structurally undisturbed blocks of coal sufficient to establish a small to medium sized mining operation. The target seams were the Whybrow and Redbank Creek seams. The proposal forecast annual production of between 0.75 and 1.5 million tonnes per annum, subject to identification of a minimum of 15 to 20 million tonnes of mineable coal. [257] Mr Mullard indicated that the Department had not contacted Independent Coal to ascertain whether they still had an interest in the area following DCM's application. [258] 9.3.2 Excel/Peabody 1. On 7 October 2005, Excel (which later became Peabody) made an application for consent to apply in relation to an area with a small intersection with the south-west corner of the DCM application. [259] The application sought the allocation on the basis it was an extension to an existing operation. It was contended that the area sought (which was significantly smaller than the area sought by DCM) was not likely to be developed as a stand-alone operation. The Department ultimately recommended the area (approximating 9.8km²) be allocated to Peabody on the basis that it was a "minor addition to an existing mine" and by letter dated 15 February 2008, Mr Macdonald granted the relevant consent. As this preceded the grant of the exploration licence to DCM, the intersecting corner appears to have been carved out of the area ultimately granted to DCM. [260] 9.3.3 Simatar Resources Pty Ltd 1. On 27 March 2006, Simatar Resources Pty Ltd (Simatar) applied for consent in relation to an area with a substantial overlap to that sought by DCM. [261] The area sought was significantly larger at approximately 75km². The application stated that public domain documents, including a report in relation to a renewal application by Bayswater Colliery (see below), indicated potential underground reserves in the order of 50 million tonnes. Mr Mullard was unaware of whether the Department contacted Simitar when considering the DCM application. 9.3.4 Bayswater Colliery 1. A document prepared by Bayswater Colliery (Bayswater), I infer to support an extension of two years of an authorisation labelled A172, was tendered as part of Exhibit A (the Bayswater report). [262] According to the comparison map, Bayswater's area of interest was to the north and slightly east of the area sought by DCM. It is unclear whether Bayswater still held what it described in the report as an "authorisation title" over that area. It is similarly unclear what an "authorisation title" is or was. The report indicates that 65.4 million tonnes of in situ coal had been identified. The report indicated that mining, at that time, was not economic at the then existing sales prices and operating costs. Nonetheless, it is apparent from the report that Bayswater had, at least in 1991, an ongoing interest in the area. The evidence, particularly in relation to Caroona and Watermark, was that coal prices had increased to a point where interest in mining was significantly greater. While there was no evidence as to what, if anything, had happened in relation to Bayswater, that earlier history suggests that in the circumstances which prevailed in 2007 and 2008, there was a real prospect of interest in Doyles Creek. 9.3.5 Atlas Coal Enterprises Pty Ltd 1. On 9 December 2007, Atlas Coal Enterprises Pty Ltd (Atlas) wrote to the Department, marked to the attention of Ms Moloney, formally requesting "an access permit to undertake exploration activities on the Jerry's (sic) Plains and Bergen mining areas". [263] Mr Coutts said he understood the area sought covered the same area as the DCM proposal. [264] 2. Atlas proposed exclusive access for six months with a further six-month option for the purpose of drilling 35 holes in order to undertake "washability analysis" of several target seams identified in a preliminary analysis. The letter indicated an intention to drill a further 50 holes "for the purposes of assessing the coal bed gas levels for the purposes of modelling the carbon foot print of the mining lease". [265] This was to be done in order to "conduct preliminary design and costing of the environmental technology required to be implemented to ensure that a net carbon positive outcome is achievable during full mining activity". The application highlighted Atlas' environmental credentials indicating a goal of making their open cut mining carbon neutral and their underground mining carbon positive. The application indicated Atlas had entered into a formal alliance with Greening Australia Ltd to advise on environmental policy, strategy and compliance auditing in order to achieve their goal of being industry leaders in environmental and community management. 3. Ms Moloney wrote to Atlas on 18 September 2007, indicating that a number of companies had expressed interest in an exploration licence in the areas sought and that, consequently, "the area may be suitable for a competitive release process in the future". [266] The letter also noted the Department's intention to undertake a "review of the geology and coal resource potential of the area before proceeding with any recommendation for an exploration licence allocation in the area". On 17 January 2008, Mr Coutts responded to an email from Ms Tan. [267] It appears that Ms Tan had spoken on the phone to Mr Clough, the author of the Atlas letter who wanted to know if there was any further information he could provide "following our meeting with him last year". [268] Ms Tan indicated her memory was "DPI minerals were going to have more of a think about this". [269] Mr Coutts in his email to Ms Tan indicated that Atlas sought a significant resource with respect to which other interest had been expressed, including by Mr Maitland "with his training mine proposal". The email indicated that Atlas claimed it was close to a demonstration project in Queensland and the Department consequently advised that it would be preferable to see how that project progresses before "offering them coal reserves in NSW which are in short supply, and in high demand from a number of companies". Mr Coutts suggested a response to the effect that they were not in a position to allocate anything at this stage, "but we will await with interest the outcome of their project in Queensland". [270] 4. The Atlas correspondence, as with the other evidence of interest in the location, was admitted against Mr Macdonald, but in relation to Mr Maitland was admitted only as to element 1 (as was the other evidence of interest in the site). Evidence of an application made after Mr Maitland's first application and the Department's response was potentially significantly incriminating against Mr Macdonald. While, from the emails, Ms Tan was clearly aware of the application, she was never asked about it, and thus was never asked if she had discussed it with Mr Macdonald. Mr Macdonald, in his evidence, denied being aware of it. I am, as a result, not able to find that he was aware of it. However, the evidence does not lose all significance. As an objective fact there was interest in the Doyles Creek area. 5. While none of the various proposals discussed above related to precisely the same area as was sought by DCM, at least two had significant overlap. These proposals, together with other interest shown in the general area, support the contention that interest in the area had been expressed, including interest in relatively recent times. Insofar as it was submitted on behalf of Mr Macdonald that the interest was less than was the case for Caroona and Watermark, I do not find the comparison helpful. Those areas were opened to expressions of interest. The point here is that it cannot be known what companies may have come forward had a similar process been followed. Further, while there is no evidence the Department made contact with the various companies to ascertain continuing interest, in light of the evidence of the coal price in 2007 and 2008, and the interest in coal generally around that time, I would, despite the lack of enquiry, still draw the inference that the area was of interest to other mining companies. Even if the particular companies that had previously expressed interest in the area were no longer interested, an open tender process may have sparked the interest of other companies. Thus, while Mr Macdonald may not have been aware of the detail, there was a sound foundation for the Department's view that interest in the area from other sources was likely. The Department's view, in the context of the advice given, is discussed in detail below. 6. Had Mr Macdonald sought information from the Department at the time he ultimately granted consent to apply to DCM, he would have been informed about the interest only very recently expressed by Atlas. Of course, I cannot draw any inference from what Mr Macdonald could have, but did not, know. However, if Mr Macdonald was unaware of the level of interest, including the recent Atlas proposal, it tends to highlight a failure in the process through Mr Macdonald failing to engage with his Department in relation to the resource. Irrespective of his knowledge of the detail of the above proposals, what is established is that Mr Macdonald was informed by the Department in the briefing notes of 14 February 2007 and 27 May 2008 discussed below, at least in general terms, that there was other interest in the area. This, of course, is a matter to be considered in conjunction with the other evidence. 10. The case in detail: Part 4 – The process leading to the application for consent 1. Evidence of the identification by ResCo of the resource sparking the decision to apply is contained in documents 19 and 20 of Exhibit A, which were tendered against Mr Maitland only. While the evidence given by Mr Maitland and other evidence called by him was admissible in the case of both accused, there is no suggestion that Mr Macdonald was aware of what was happening within ResCo leading to its application. It is convenient to consider the unfolding events by reference to evidence from the perspective of Mr Macdonald, or at least the Department for which he was responsible. 10.1 Mr Maitland's appointment to the Coal Competence Board 1. Mr Maitland had, subsequent to his resignation from the CFMEU, been appointed at the instigation of Mr Macdonald as the chair of the Coal Competence Board. In December 2006, s 130 of the Coal Mine Health and Safety Act came into force pursuant to which a Coal Competence Board was to be established under the direction and control of the Minister. [271] As outlined above, the Coal Competence Board was, in very general terms, created to oversee the competence of people performing functions in coal operations, develop competence standards and advise the Minister on related matters. There was no suggestion that Mr Maitland was other than eminently qualified for such a role or that there was anything corrupt or otherwise untoward in relation to Mr Macdonald's appointment of Mr Maitland to this position. Mr Maitland said his appointment was the result of the recommendation of the union and that he had no contact with the Minister regarding this appointment until January 2007. [272] 10.2 The meeting of 19 January 2007 1. Emails between Mr Macdonald's staff indicate that in December 2006 they were attempting to arrange a meeting between Mr Macdonald and Mr Maitland. Mr Maitland was apparently wanting to discuss what Mr Macdonald wanted of him with respect to the Coal Competence Board. [273] A meeting organised through Mr Macdonald's office took place on 19 January 2007. The briefing prepared for Mr Macdonald indicated the participants as the two accused, Mr Hewson and Ms Tan. 2. Email evidence suggests that Mr Maitland arrived early and that, as Mr Macdonald was still in another meeting, Mr Hewson took Mr Maitland to have a coffee. Mr Hewson did not specifically recall this and said he did not know Mr Maitland particularly well. Mr Hewson said he had only a "vague recollection" of the meeting. He said he was aware that Mr Maitland was, at some point in time, involved with ResCo which had sought consent to apply for an exploration licence. He said this could have been discussed at the meeting. Ms Tan recalled a discussion about a training mine in the Hunter Valley. She said Mr Maitland said that it would involve other interested parties including TAFE. The idea was to address skills shortages. Ms Tan recalled Mr Macdonald being supportive of the idea. Ms Tan also said she had no recollection of the Coal Competence Board being discussed during the meeting although she accepted it was possible that she had been asked about the training mine discussion so often that she had forgotten any discussion of the Coal Competence Board. 3. Mr Macdonald said the Coal Competence Board was discussed but that Mr Maitland also raised the concept of the training mine. He said that Mr Maitland said that the idea of a training mine had been raised in the past but the major problem had been a lack of funding, and he was working with people and looking at a more commercial concept to address the funding problem. Mr Macdonald said that the issue had been raised with him in the late 1990s and that he had, in turn, raised it with Mr Della Bosca when he was Parliamentary Secretary to Mr Della Bosca, who was then the Industrial Relations Minister. It did not, however, fall into Mr Della Bosca's portfolio. Mr Macdonald said that in 2004 or 2005, he discussed the issue with Mr Kerry Hickey who was then the Minister for Mineral Resources. Mr Hickey told him that he was attracted to the idea and wanted to do it but the Department was reluctant as they were concerned they may have to bear the costs. When it was raised by Mr Maitland, he said that if he had a new concept he should put it in writing. [274] In cross-examination, he said he had supported the training mine concept for a decade. He said that while he was not a supporter of any particular model, he thought that training was a very good idea. [275] 4. Mr Maitland recalled having coffee with Mr Hewson before the meeting with Mr Macdonald and he presumed he discussed with him the proposal for the mine at Doyles Creek. [276] He said at the meeting with Mr Macdonald, they discussed the Coal Competence Board and he got approval from Mr Macdonald to appoint the Deputy Chairperson. [277] He also said he talked about skills shortages and raised the fact that he was looking at establishing a training mine. [278] He said Mr Macdonald told him he needed to provide more details. [279] 10.3 Mr Maitland's "briefing note" of 22 January and the ResCo application of 15 February 2007 [280] 1. The following Monday, 22 January 2007, Mr Maitland sent an email to Mr Hewson attaching what was titled a "briefing note" on the "mining lease issue" and indicated he would call to discuss the matter. [281] He also sent the briefing note to Ms Tan that afternoon indicating to her that he would appreciate her advice. [282] 2. The briefing note asserted a severe shortage of semi-skilled and skilled workers across Australian industry generally, particularly in underground coal mining. It referred to a study indicating that the minerals industry would need an extra 70,000 workers over the next 10 years to meet its demand for labour. The note indicated that discussions had occurred over a lengthy period with respect to an underground training mine in the Newcastle/Hunter area but had floundered primarily due to the lack of a suitable site and adequate financial support. The note continued, indicating that a "specific initiative has now been developed" with the support of a number of Newcastle business people to establish a company "with adequate financial resources" to establish a training mine as part of its business objectives. [283] It was suggested that, given the skills shortage, the initiative would attract industry and federal government financial support. With respect to a site, it was indicated that while almost all economically viable quality coal reserves were under title, the "proposed project only needs a coal resource that would allow the development of a small to medium sized mining operation". The note indicated that "[t]he complexity of the local geology has discouraged larger coal producers from carrying out coal exploration." (This sentence appears to be identical to a sentence in the letter accompanying the Independent Coal proposal made in December 2002. [284] The remainder of the paragraph and the following paragraph bear a striking similarity to corresponding parts of the Independent Coal letter. There was, however, no exploration as to whether Mr Maitland had access to the Independent Coal letter or, if so, the source from which it was obtained.) The note indicated that there may be blocks of coal sufficient to establish "at least a small to medium sized operation, specifically designed to accommodate the training initiative". The note identified a general area and indicated a document was attached which included co-ordinates. There is, however, some uncertainty as to whether this was actually attached. [285] 3. Mr Macdonald said that he received a copy of the briefing note. He said he thought it was interesting, particularly the concept of the commercial viability, which distinguished it from previous efforts to establish a training mine. He said he asked Mr Hewson to obtain the Department's view. [286] 4. One week after Mr Maitland's note, on 29 January, Mr Hewson emailed Ms Tan asking her to phone Mr Maitland when Ms Tan found out "how we are going to handle this", [287] in reference to the training mine. Ms Tan contacted Mr Coutts and asked his opinion of the training mine. She said she was told that it was an idea that had previously been canvassed but did not go ahead. He also told her he would look into it and give her some advice, but according to Ms Tan, he did not seem very supportive of it. Mr Coutts confirmed this and said that he told Ms Tan he would get hold of some information in relation to previous consideration of the training mine concept. 5. Mr Macdonald said that he spoke to Mr Coutts and confirmed that Mr Coutts was not enthusiastic about the proposal. He said they discussed the economic viability of the proposal. 6. Mr Macdonald gave evidence that he told Mr Hewson that the core thing in relation to the proposal should be that the government not bear any cost in setting up or running a training mine and that should be indicated to Mr Maitland. [288] This appears to have resulted in the letter from Mr Coutts to Mr Maitland on 30 January stating, "[i]n order that the minister can consider your proposal further he has asked that I seek from you more details of the proposal, in particular, how the proposed mine would operate on a commercial basis and what, if any support would be required from government." [289] 7. On 1 February, Mr Coutts sent Ms Tan an email in which he said that he understood that a number of companies had sought the area in question but that it had not been allocated because it lies in a "fairly sensitive area". [290] The email included an earlier email written by a departmental officer with information obtained from records of the Mine Safety Council and concluded: [291] "Following a consultant's study in 2000 into the feasibility of a training mine -which indicated many problems, the (then) Mine Safety Council agreed that the Training Mine concept no longer be pursued. The CFMEU (at that time) supported the cessation of the underground Training Mine study, in favour of the use of simulation training." 1. Mr Coutts explained that the simulation training was something developed by Coal Services, which was a body jointly owned by industry and the unions. 2. Ms Tan forwarded the email to Mr Hewson. Mr Hewson said whilst he did not specifically recall it, the email would have been discussed with Mr Macdonald. [292] 3. On 6 February, Mr Maitland emailed Mr Coutts, copying Mr Hewson, attaching a response to Mr Coutts' email of 30 January. [293] The response reiterated the skills shortage and other aspects of the first note, and indicated Mr Maitland's awareness of the matters required to be included in an application for consent. The note continued that, should exploration drilling identify sufficient coal resources to establish a small to medium sized mine, the company making the proposal has access to sufficient private equity capital to develop the mine. It was submitted that market demand for the anticipated coal was such that the mine could be a sustainable commercial business. The letter concluded that the Minister's consent to apply for an exploration licence would be sought. 4. On 9 February 2007, [294] Mr Coutts emailed Ms Tan forwarding what was described as a "draft brief" prepared by Mr Mullard (although it appears its preparation was largely delegated to Ms Madden). [295] Mr Coutts indicated he was proceeding on the basis that a formal request had not yet been made by Mr Maitland. He noted that Mr Maitland had responded to his "earlier" email, which appears to be a reference to Mr Coutts' email of 30 January and Mr Maitland's response of 6 February. The email also noted that the MMAC had established a subcommittee to look at the skills shortage and said "I doubt a training mine would be high on their agenda – industry hasn[']t supported this idea in the past and with virtual technology it[']s probably a bit old hat". [296] It does not appear that Mr Macdonald saw this email, although he recalled Mr Hewson telling him that industry had, in the past, not supported the training mine concept. [297] 5. The Department's draft briefing note attached a map describing what was "believed" to be the proposed area based on Mr Maitland's description. (It does not appear to correspond precisely with the area subsequently identified.) Ms Madden explained that she was able to obtain information from Ms Moloney, who was responsible for keeping a register of companies that had expressed an interest in coal mining in particular areas. Mr Mullard explained that this register was kept by the Coal Allocation Committee. He said that when an application was received, if the area was not suitable for direct allocation (such as for a stand-alone area), the applicant would be advised that the area may be considered for competitive tender in the future in which case they would be advised. [298] 6. Ms Tan forwarded the draft brief to Mr Hewson and indicated as "Things to note": [299] "1. Estimated 62MT resource 2. Ultrasensitive nature of the resource - close to Jerry Plains' township, alluvial areas and Wollemi National Park. 3. There are other companies who have expressed an interest in the resource 4. We will have to put the area out to tender (for rights to explore)." 1. Point 4 was a conclusion. The draft briefing note itself said only that "if the area were to be tendered it is expected that there would be a number of interested parties seeking access to this resource". The briefing note did not suggest any action but concluded with the recommendation that the Minister note the brief. This would appear to be consistent with there being no formal application for the area at that time. Ms Tan concluded her email by stating that she thought the issue should be put over for a couple of weeks. Mr Hewson responded to Ms Tan's email stating "I agree. Need to talk to Ian as to how to handle it". [300] Ms Tan responded by email on 14 February indicating she would have the brief sent up formally and "then chat to him". [301] Ms Tan in her evidence said the context was the impending State government election on 24 March 2007. 2. In accordance with Ms Tan's email to Mr Hewson, on 14 February, Ms Tan contacted Mr Coutts requesting a formal brief which was provided by the Department on 22 February 2007. 3. In the meantime, by email to Mr Hewson and Ms Tan on 15 February 2007, Mr Maitland provided a letter making application on behalf of ResCo for consent to apply for an exploration licence for an area set out in an attached map including co-ordinates and described as ELA 1. [302] The letter was barely over two pages. The email indicated the letter had been sent by express post to the Minister and to David Agnew of the Department. It is noted this is the first correspondence on ResCo letterhead, and the first to specifically refer to the seeking of consent under s 13(4) of the Mining Act. The application indicated that ResCo was a recently formed company whose "business objectives include the development of a new underground training mine in the Hunter Valley". [303] This was consistent with the two letters previously provided by Mr Maitland. The proposal largely repeated contents of those letters, but provided some additional information. The application referred to the presence of Mr Ransley on the Board who, it was said, had extensive experience of the labour market in the coal mining industry; a commitment to fund test drilling and other activity necessary to complete a feasibility study; proposed funding arrangements for such a feasibility study; intended alliances with TAFE and Coal Services for the purpose of the training program; and a commitment to a public relations program to deal with landholders and community groups. The proposal indicated an anticipation that sufficient coal would be produced for sale which would "assist in funding a specifically designed training facility". [304] 10.4 The Department's briefing note of 22 February 2007 1. On 22 February 2007, a briefing note prepared by Mr Mullard was provided to Mr Macdonald by the Department. Despite some conflicting evidence, it does not appear that the ResCo letter of 15 February 2007 was considered in preparing this briefing note. This conclusion is based on the fact that the briefing note refers specifically to the letters of 22 January and 6 February and appears to attach them but does not make any reference to the letter of 15 February. It also refers to what the Department believes to be the area described by Mr Maitland, rather than the area specifically delineated, with co-ordinates, by ResCo in the letter of 15 February. 2. The briefing note is set out in full below (with paragraph numbers added): [305] "Issue: [1] To provide information and advice in relation to a proposal to establish a training mine in the Hunter Valley. Background: [2] Mr John Maitland provided a briefing note to the Minister's office on 22 January 2007 outlining a proposal to establish a training mine in the Hunter Valley and proposing an area for the project [TAB 1). The Deputy Director-General sought further details of the proposal from Mr Maitland to assist in the Minister's consideration of the proposal and Mr Maitland responded on 6 February 2007 (TAB 2). [3] The area proposed by Mr Maitland is believed to be as shown on the attached plan based on Mr Maitland's description of the area (TAB 3). As such, it is bound by the township of Jerry's Plains(sic) to the west, alluvial areas associated with the Hunter River and the Wollemi National Park to the south and east. [4] The subject area was previously explored by Bayswater Colliery Company Pty Ltd between September 1989 and April 1991 which provides data on the coal reserves. The area has been estimated to contain 62 million tonnes of underground coal reserves. As such, it would be classified as a major stand alone are under the current Guidelines for Allocation of Future Coal Exploration Areas (March 2006) and subject to allocation by competitive tender or expression of interest with a financial contribution. [5] The coal resource in the area identified by Mr Maitland has been subject to an expression of interest by Simitar(sic) Resources who have requested that they be considered as part of any allocation of coal resources in this area. In addition, Wambo Coal and Independent Coal Pty Ltd have also expressed interests in areas adjacent to (and which may overlap in part) the area mentioned by Mr Maitland. [6] These expressions of interest have not been progressed at this stage due to the sensitive nature of the area. This was due to the proximity of the Jerry's(sic) Plains township, the alluvial areas and proximity to the Wollemi National Park. It is reasonable to expect that any new mining development in this area would raise significant environmental and local community concerns. [7] If the area were to be tendered it is expected that there would be a number of interested parties seeking access to this resource. Comment: [8] A similar proposal was considered in detail by the former Mine Safety Council (now Mine Safety Advisory Council) in late 1999 -early 2000. Following the 2000 study by consultant Mr Bob Gibbons into the feasibility of a Training Mine – which indicated many problems, the (then) Mine Safety Council agreed that the Training Mine concept no longer be pursued. The CFMEU (at that time) supported the cessation of the underground Training Mine study, in favour of the use of simulation training. [9] There would be major policy difficulties, potential probity issues and environmental sensitivities involved in considering a proposed direct resource allocation for this purpose. In addition, without the support of major industry players, it is unlikely that the present proposal would be successful. It is considered that industry in general may not be supportive, as they would advocate each mine has particular management systems in place, and site specific training at each mine is preferred. [10] The strengthened Mine Safety Advisory Council is the tripartite body that considers and advises on strategies to enhance mine safety performance in NSW. This includes skill and competency training needed to improve safety performance in NSW mines. Although in early 2000, the (former) Mine Safety Council, with CMFEU support, agreed not to pursue the consent of a Training Mine in favour of the use of simulation training, the Minister may wish to consider referring this current proposal to the new Mine Safety Advisory Council for its further consideration and advice. [11] Options: 1. The Minister reject the current proposal because the Government is not prepared to allocate the proposed area at this time, and there is no demonstrated support from the coal industry in general for a proposed training mine. 2. The Minister agree to seeking competitive Expressions of Interest for the proposed area under the current Guidelines for Allocation of Future Coal Exploration Areas (March 2006) which includes a financial contribution. 3. The Minister refer the proposal to the Mines Safety Advisory Council (which as the former Mine Safety Council had previously considered a similar training mine proposal) and seek the Council's advice on the current training mine proposal to inform the Minister's further consideration of this matter. Recommendation: [12] Option 3 is recommended as appropriate initial action." 1. Paragraphs [3] – [7] essentially repeat the contents of the draft briefing note of 9 February. The remainder, under the headings "Comment", "Options", and "Recommendation" was new. While the estimate of 62 million tonnes came from the Bayswater Colliery report and related to a different area to that identified in the ResCo letter of 15 February and ultimately pursued, [306] little turns on this as what is of primary relevance is what was understood, or can be inferred to have been understood, by Mr Macdonald. In this regard Mr Macdonald said he recalled receiving a copy of the briefing note. 2. There was a significant focus at the trial on the reference to "probity issues" at [9] of the briefing note. Mr Coutts said he had never previously issued a briefing note with a reference to probity issues. [307] He said that because of the sensitivity of the proposal, he briefed the then Director-General, Mr Barry Buffier. Mr Mullard gave similar evidence, [308] although he acknowledged, given the passage of time, he may have used that expression or something similar to it in another briefing note. [309] Mr Macdonald accepted he had not seen the words "potential probity issues" used in, I infer, a similar document before. [310] With respect to the full sentence, "there would be major policy difficulties, potential probity issues and environmental issues involved in considering a proposed direct resource allocation for this purpose", his "take at that point" was "don't go ahead with it … very much so". [311] While Mr Mullard gave evidence as to what he meant by "potential probity issues", I do not regard what was in Mr Mullard's mind as relevant, given the absence of any suggestion it was communicated to Mr Macdonald (or Mr Maitland). On the other hand, Mr Macdonald gave evidence that he understood the "probity" issues to be largely the "thinness" of the document. [312] He said it was a thought but there was "no flesh on the bones" [313] and "insufficient information in the document to justify" the direct allocation sought. [314] He indicated to Mr Hewson that he was not going to proceed with the matter. [315] Mr Macdonald also said that there was an election on and that "you don't make these sorts of decisions prior to an election" although he did not specifically link this with the "probity" concerns. [316] 3. Certainly, one can accept that a lack of detail would be likely to create immediate questions with respect to any approval. However, inadequate proposals were, presumably, not unusual. The strength of the language and the unusual nature of such a reference suggests it meant something more than that and most likely included a concern with respect to an allocation to a company associated with a former union representative. It is, however, to be noted that in subsequent briefing notes, in the context of a significantly more substantial application, the reference to "probity issues" was not repeated. Ultimately, it is not to the point that Mr Mullard, or the Department more generally, may have thought that a grant of consent to apply to ResCo may have raised probity issues as a result of Mr Maitland's connection with the application. Perhaps, if Mr Macdonald had understood the intended meaning, it might have been expected he would do more to ensure the integrity of the process. But as noted above, the matter was only raised in the briefing note of 22 February 2007. More than a year passed before Mr Macdonald was called to consider the more complete application. I would not, therefore, in the circumstances, draw anything from the reference to "probity issues" in this briefing note. That is not to say that I am not entitled to have regard to the process by which the consent and the exploration licence were granted, to contrast that process with other allocations (such as Caroona and Watermark) and to draw inferences from that as to Mr Macdonald's intentions. 4. Mr Macdonald said he agreed with the comment that, without the support of major industry players, it is unlikely the proposal would be successful. Other than that, he said that he took from the document that, at 62 million tonnes what was being sought was not "a massive resource". He distinguished it from a resource like Caroona which was 500 million to a billion tonnes. He understood the Department to be saying that under the guidelines, if there was to be an allocation, it would have to be by expression of interest, and there would be a financial contribution paid according to the table. Mr Macdonald referred to the guidelines (as noted at [195] above) to the effect that, while normally allocations are made on a competitive basis, there may be circumstances "where coal allocations are made subject to certain conditions and including a financial contribution". He said that he understood this allowed an area to be allocated by way of direct allocation, generally when there was a public benefit attached to an exploration licence. Mr Macdonald was taken to the reference in the briefing note to the classification of the area as a "major stand-alone area" under the guidelines. He understood a major stand-alone area to be "an area which would be self sustained". [317] 5. With respect to the problems identified by the study by Mr Gibbons leading to the MSAC not pursuing the training mine concept, Mr Macdonald said, "it would be a bit of a stab in the dark" but he recalled Mr Hickey indicating that the problem of funding a training mine seemed to be the "bug bear" (which I take to mean the primary obstacle). [318] The study referred to was tendered in these proceedings by Mr Macdonald. [319] Its relevance is somewhat tangential given that Mr Macdonald did not suggest he had read the report at the time, however, it did provide support for Mr Macdonald's contention that the problem of funding a training mine had been a significant barrier in the idea gaining acceptance. 6. While the briefing note recommended a referral of the proposal to the MSAC, Mr Macdonald indicated that "the proposal was in a very early form, to say the least, and I was not going to put it to the Mine Safety Advisory Council". [320] He said that he had an approach of being "very cautious" about putting controversial areas before tripartite committees, as if there were divisions or different views, it was not productive. [321] In this particular case, Mr Macdonald thought it was a good idea but "not in any way ready for policy consideration". [322] As to the three options indicated by the Department, Mr Macdonald said "if you were to say which option I took, it would have been probably option 1, but, I sort of, put it in a too hard basket, given the election was on and I was occupied with other issues". [323] He said that he "asked Mr Hewson to let Mr Maitland know" that he (Mr Macdonald) was not going ahead with it, and to brief Mr Maitland on the Department's views about the concept as it stood. [324] 7. Mr Hewson said that he would have spoken to Mr Macdonald about the proposal but had no real recall of the conversations. [325] In cross-examination by counsel representing Mr Macdonald, he agreed that in that conversation Mr Macdonald indicated he was interested in the proposal but the issue required further consideration and could not proceed without industry support. He agreed that Mr Macdonald conveyed that there was no rush as there was no certainty he would be in government after 24 March 2007. 8. I have reservations as to Mr Macdonald's evidence that he avoided referring controversial issues to tripartite committees. If a controversial measure was to be considered it seems to me the benefit of a tripartite committee is that it would allow industry, unions, and the Department to consider the issue in an environment where perspectives could be shared. The expectation on such a committee would be that the participants would work together in a professional manner even if agreement was not ultimately possible. If a controversial measure was to be introduced, it would be far preferable that it be considered in such an environment first. 9. Insofar as it was submitted Mr Macdonald's decision not to go ahead with the proposal at that stage reflected his impartiality to the application, the reality was that there was clearly, as Mr Macdonald said, insufficient information in the proposal to justify the allocation. The letter was barely over two pages, annexing only the map and co-ordinates of the area sought. The proposed training facility was not elaborated on other than that there would be a training mine and it would "include classrooms and accommodation". There was no detail as to any proposed exploration programme or the size of any commercial mine or training mine. To grant approval on the basis of such a letter to a company associated with a former official of a union with links to the party in government, two weeks out from an election that the Labor government was expected to lose and contrary to the Department's advice, could not have withstood the most cursory scrutiny. Mr Macdonald not granting the application on the basis of this letter is accordingly not evidence of impartiality. I would, however, accept that if, as Mr Macdonald said, he had no intention of going ahead with the proposal (at least at that stage), the decision not to refer the matter to the MSAC at that point in time is understandable. Whether the decision to allocate the resource without ever consulting the MSAC is understandable is another question, and one which will require consideration subsequently in these reasons. 10.5 The meeting of 8 March 2007 1. As noted above, Mr Macdonald said he asked Mr Hewson to speak with Mr Maitland with respect to the proposal. A meeting took place attended by Mr Maitland, Mr Hewson and Ms Tan on 8 March 2007. Mr Macdonald was not at the meeting. Mr Hewson explained that, having regard to the impending election, it was a very busy time and, particularly as Mr Macdonald had obligations in country areas, it would be very rare for him to be in the office around that time. [326] 2. Mr Hewson received an email from the Department attaching the Ministerial Briefing of 22 February 2007 that day. The evidence establishes that Mr Coutts instructed a member of his staff to email it to Mr Hewson. [327] While Mr Coutts does not appear to have been asked about it, I infer it was sent at Mr Hewson's request. Mr Hewson also asked Ms Tan to "quietly" gauge the level of union support for the proposal prior to the meeting. 3. Whatever the precise circumstances, it is clear that Mr Maitland had access (either physically, or by being told in some detail) to the contents of the briefing note. This is apparent from Mr Maitland's note attached to an email of 26 March and sent to Mr Stevenson, Mr Chisholm, Mr Ransley and Mr Poole. It is convenient to set out Mr Maitland's note in full: [328] "Briefing note on progress with Doyles Creek ELA 26th March. Following my letter of the 15 February to the Minister for Mineral Resources, Ian McDonald (sic) seeking consent to make application for an exploration licence at Doyles Creek, I met with members of his staff on Thursday 8th March. They told me that the Department had made the following observations regarding our application and the proposal for the training mine 1. A similar proposal was considered by the former Mine Safety Council (now Mine Safety Advisory Council) in late 1999 and early 2000. Following a study by consultant Bob Gibbons into the feasibility of a training mine, the Mine Safety Council agreed that the training mine concept no longer be pursued. The Department noted that the CFMEU at that time supported the cessation of the underground training mine study in favour of the use of simulation training. 2. The Doyles Creek area has previously been the subject of interest by a number of companies but no formal proposal has been received before now. The area contains substantial tonnes of underground coal reserves and it would be classified as a major stand alone area under the "guidelines for allocation of future coal mining areas" and subject too(sic) allocation by competitive tender or expressions of interest with a financial contribution. It would seem that a number of interested parties would seek access to the reserves if the area were to be tendered. 3. The area is considered to have environmental and publicly sensitivities. This is due to its proximity to the Jerry's(sic) Plains Township, the alluvial areas of the Hunter River and the proximity to the Wollombi national park. 4. The department says it is reasonable to expect that any new mining development would raise significant environmental and community concerns. The department suggest that the Minister may wish to consider referring the current proposal to the Mine Safety Advisory Council for its further consideration and advice. The above advice provides an outline of the challenges faced in getting approval for the exploration licence. We need to be able to show that circumstances have changed since 2000 and that the development of a training mine would be in the public interest and beneficial to the State of New South Wales. We would also need to show that ResCo has significant support to develop the concept. There is no doubt that the extreme shortage of underground mining skills, which is acknowledged by the minerals council, demonstrates changed circumstances since 2000. My meetings thus far with the Hunter Valley Training Company, Coal Services Pty Ltd (including a visit to the training simulator at the NSW Uni last week) and the CFMEU who are all willing to support the initiative by reaching [a memorandum of understanding] with ResCo are helping to establish that there is now more momentum for the training mine. Minerals Council support would be tremendous but I doubt we will get it, however, as the Hunter Valley Training Company has 2000 trainees and is supported by several mining companies we might be able to avoid at least opposition from the minerals council. A major issue is the suggestion that there may be an open tender for the area, which could result in unrealistic bids for the resource. My suggestion is that we conclude the [memoranda of understanding] with HVTC, CSPL and the CFMEU and then meet with the new Minister as soon as possible." 1. It can be seen that the paragraph numbered [1] largely replicates the briefing note at [8], although there are some differences. Paragraph [2] appears to be drawn from the briefing note at [4], [5], and [7], although the source of the statement "no formal proposal has been received before now" is unclear. Paragraph [3] appears to be drawn from the briefing note at [6]. Paragraph [4] contains material from the briefing note at [6] and the recommendation and the last sentence very closely resembles the concluding words at [10] of the briefing note. It is clear that, at the very least, Mr Maitland was given the opportunity to take detailed notes in relation to the parts of the briefing note referred to above. It is not clear he necessarily had the whole note. 2. Ms Tan did not recall discussing the Department's view with Mr Maitland but believed she would have done so on the basis that it was usual to give feedback to stakeholders. She said she believed Mr Macdonald was supportive of the proposal, although it is not clear whether this was communicated to Mr Maitland. When asked if she recalled herself or Mr Hewson giving Mr Maitland a copy of the briefing note she said that she knew she would not have given it to him, but "I can't speak for Mr Hewson". [329] She was, however, in the meeting with Mr Hewson and did not suggest she saw this occur. She said that it was normal to brief a proponent on the Department's views. Mr Hewson said he could not recall but he may have given Mr Maitland a copy of the briefing note or just gone through it with him. 3. Mr Maitland said that while he could not be certain he was given a copy of the briefing note, he accepted it was something that may have happened. His evidence was, in essence, that he did not have a recollection one way or the other. This was understandable, given the passage of time. He acknowledged the similarities and when it was suggested that he was shown a copy of the document he said, "I don't dispute that". [330] In context, this fell short of suggesting an actual recall of seeing the document. I would not conclude that Mr Maitland had the entire briefing note. Apart from the lack of direct evidence, there are some differences between the documents suggesting that Mr Maitland's document may not have been directly copied from the briefing note. Simple changes like the omission of the words "in detail" from that appearing in the briefing note at [8] could be a choice. However, the change from "late 1999 - early 2000" to "late 1999 and early 2000" results in a change of meaning and is an odd choice for someone actually looking at the source document. Also, the split of material sourced from [6] of the briefing note into paragraphs [3] and [4] or Mr Maitland's note is somewhat unnatural with respect to the content, and more suggestive of a dictation process rather than direct access the document. Additionally, in his note Mr Maitland reports meeting Mr Macdonald's staff and says, [t]hey told me that the Department had made the following observations" before setting out the issues. The addition of the words "[t]hey told me" suggests information conveyed through Mr Macdonald's staff, and would be unnecessary and misleading if the information was obtained directly from the document. None of these matters is conclusive, but considered together, I cannot be satisfied Mr Maitland actually saw the document. 4. Ultimately, the meeting of 8 March 2007 says little about Mr Macdonald's liability. The meeting took place at a time at which Mr Macdonald had little reason to be confident he would still be Minister in a little over two weeks' time. There is no evidence that he instructed his staff to provide any more information than they regarded as appropriate. At best, it establishes that when he resumed his ministerial position following the election, he was likely to have been aware of Mr Maitland's knowledge of the Department's view. 10.6 Post-election and the Prime Restaurant meeting 1. The Labor Party was returned to government at the 24 March 2007 election. Evidence of senior members of the government was that this was somewhat unexpected. [331] This was echoed by Mr Macdonald. [332] 2. On 3 April 2007, DCM held a board meeting. This will be discussed in the context of Mr Maitland. 3. Mr Hawkes of the Department emailed Ms Tan on 10 April 2007 attaching the 22 February 2007 briefing note and asked whether the matter had progressed at all and whether it was still being considered. On 4 May 2007, Mr Hawkes made a note on the Department's record-keeping system indicating that the Minister's office advises that "no decision made on options as yet". [333] Mr Macdonald said that after the election he was appointed to two additional ministries, Energy and State Development, with a significant impact on his workload. 4. Mr Macdonald attended to open the New South Wales Minerals Industry Occupational Health Conference at Peppers Fairmont Resort in the Blue Mountains on 21 May 2007. A ministerial briefing in relation to the event referred to the government having provided additional funds to improve mine safety and to implement the recommendations of the Wran report and those of an earlier inquiry. Notably, the briefing referred to the work of the MSAC. It also referred to the government working with industry stakeholders to "put in place a wide range of strategies to work effectively towards the goal of zero fatalities". [334] Mr Maitland was a participant at the conference. Mr Macdonald did not recall if he spoke with Mr Maitland at the conference. Likewise, Mr Maitland did not recall discussing this application with Mr Macdonald at the conference. [335] 5. Mr Macdonald said he did not recall the issue of the ResCo application surfacing until Mr Maitland contacted his office in July seeking a meeting. Based on his diary, this meeting took place on 26 July 2007 at the Prime Restaurant. Mr Macdonald attended with Ms Tan and met with Mr Maitland and Mr Ransley. By this point in time, following the election Ms Tan had shifted to the position of policy advisor for mining and energy. 6. Ms Tan said she understood Mr Ransley was there as a guest of Mr Maitland. She understood he was a former director of "TESA Mine" (which I take to be a reference to The TESA Group Pty Ltd). [336] The training mine was discussed and she recalled Mr Macdonald being supportive of it. She thought Mr Maitland provided copies of letters of support from various organisations, including the Hunter Valley Training Company (HVTC) and possibly WRHS, although in cross-examination she accepted that this may have happened later, [337] and on the objective evidence it is likely that it did. Ms Tan recalled a discussion to the effect that if the proposal was to proceed it would need industry support, although she could not say whether this occurred at the Prime Restaurant or on some other occasion. [338] 7. Mr Macdonald said he had not met Mr Ransley prior to that day. He understood that Mr Ransley had been an influential person in labour hire companies providing contract labour to the mining sector. He said Mr Maitland told him that he was in discussion with a number of institutions in the Hunter Valley about a training mine. [339] 8. Mr Macdonald said that Mr Maitland referred to support coming from the HVTC and the University of Newcastle. He said he was aware of the former as a joint venture between the New South Wales government and industry and understood it to be the largest training company in the Hunter Valley. Mr Macdonald said that he was interested in "the concept of a training mine" and that if Mr Maitland had support he should provide evidence of it. [340] I note at this point that Mr Iemma confirmed (without challenge) that there was nothing improper about requesting proponents to obtain evidence of support for a proposal. [341] 9. Mr Macdonald said that Mr Maitland raised with him skills shortages, and he again said that if he had any evidence of it, particularly in the Hunter Valley, he should let Mr Macdonald know. [342] Ms Tan confirmed this. [343] Mr Macdonald said that while he had been informed of skills shortages by a number of people, he did not actually know the scope of it and wanted assurance that there was a need to tackle this issue. Mr Macdonald denied that a strategy was devised at the lunch, whereby Mr Maitland would obtain letters with no reference to the training mine that would create an impression of a problem in order to justify support in spite of the Department's opposition and industry opposition. [344] Mr Maitland also denied any such strategy was agreed at the lunch. [345] I will return to this issue in the context of the support letters. 10. Mr Maitland accepted that he undertook a process of getting letters to demonstrate that there was a skills shortage in order to advance the prospect of getting a direct allocation but disagreed that this was a strategy worked out between Mr Macdonald and himself. [346] The evidence given by Mr Maitland as to this meeting at Prime Restaurant will be further discussed when considering the Crown case against Mr Maitland. 10.6 The Department's briefing note of 14 August 2007 1. The day following the lunch, at Mr Macdonald's request, Ms Tan requested the Department provide a brief on the "status of training/skills in the mining industry … ie are there are any shortages". [347] I would accept in this regard that there was no strategy by which Mr Maitland would be the exclusive source of evidence of a skills shortage but rather, Mr Macdonald determined to obtain independent advice from the Department. 2. The Department provided a briefing note on 14 August 2007. [348] The note observed that the mining industry was in its fifth year of an ongoing mining boom, with the result that "the demand for skilled workers is high". The note referred to a MCA report published in 2006 in relation to the labour force outlook which indicated that New South Wales would require approximately 5000 additional employees by 2015, primarily in the trades and semi-skilled categories. 3. The briefing note identified a significant shortage of geoscientists in New South Wales. It observed that many New South Wales universities were no longer offering the geoscience education required by industry with the main schools catering to exploration and mining situated outside New South Wales. The note also referred to a need for engineers. 4. With respect to skilled and semi-skilled workers, the briefing note observed that these constitute the bulk of employees within the minerals sector. The note said that the Department of Education and Training (DET) had "jurisdiction with regards to providing vocational and work-related training". [349] The note continued that "DET has identified and established training priorities specifically for the mining industry for 2007 - 2008". The briefing note concluded with the following under the heading comment: [350] "The NSW Minerals Ministerial Advisory Council (MMAC) identified skill shortages impacting on the minerals industry as a key priority issue. MMAC members met with the Director General of DET to discuss the skills shortage issue. DET responded quickly with an invitation to attend a mining industry roundtable meeting with government and industry representatives to help address this issue. Since the roundtable meeting following initiatives have been put in place. • Funding for a mining project has been approved under the COAG Targeting Skill Needs in Regions Program. This project will run for two years and will support skill needs for the mining industry in the Gunnedah region. • Public funding of training delivery for existing workers in the mining industry is available under the Strategic Skills Program. Indicative funding of $800,000 has been allocated to mining with emphasis on skills relevant to statutory positions in mines. • The Industry and Enterprise Skills Program has advertised expressions of Interest for funding to develop training resources for industry and enterprises. • The NSW Mining Industry Skills Association advised that a pilot delivery of a school based Certificate 1 in Resources and Infrastructure will be delivered in the Gunnedah region. • Launch by the NSW Government of an Innovation Strategy which includes the minerals industry (coal) as one of the sectors targeted. Recommendation: The Minister notes this brief on mining industry skills shortage." 1. Mr Macdonald said he took from the document that there was a skills shortage in New South Wales, although Queensland and Western Australia probably had greater need. He said that due to the continuing boom there was a need for several thousand skilled and semi-skilled workers with particular shortages in specific areas including geoscience. The latter was of particular concern as he had negotiated a $100 million fund for clean coal, to try and reduce the carbon footprint of the coal sector. [351] 2. It might be noted that what Mr Macdonald claims to have taken from the report was taken from the "background" section and did not include the role of DET or its response as set out in the comments section. It should also be observed that Mr Macdonald said that he was aware in August 2007 that there was a view held by a number of people in the industry that the skills shortage was not such an issue in the Hunter Valley. He did not, however, accept that that view constituted a consensus in the industry. [352] 10.7 Letters of support in August and September 2007 1. As noted above, the Crown case is that at the Prime Restaurant lunch, or at least around that time, Mr Macdonald and Mr Maitland agreed on a strategy which involved Mr Maitland obtaining letters from various organisations supporting the idea of a skills shortage in the area without mentioning a training mine, thereby advancing the case for the mine without appearing to be directly interested in that issue. 2. There is no doubt that in the time following the lunch, Mr Maitland set about obtaining letters consistent with the Crown's theory. The most telling evidence comes from Mr Jones' WRHS general manager's report dated 20 September 2007. [353] In a section headed "MOU with Doyles Creek Mining Pty Ltd", Mr Jones indicated that the WRHS, along with Newcastle University, TAFE and the HVTC had been approached to be involved in a new training mine at Jerrys Plains, which was to operate as a working mine but with "a major component as a training facility". He said: [354] "We also were asked to send a letter to the Minister in support of training as we have special needs ourselves and anything that can be done to assist we would support. Our letter mentions nothing of the mine but the strategy is that all NGO's will provide similar letters, and when the Minister receives and(sic) application for a new mine, with a specific purpose, he will already have letters which will support the concept." 1. Mr Jones, in his evidence-in-chief, said he believed the word "strategy" used in the report was Mr Maitland's word but that he did not have a clear recollection of this. [355] Later, in re-examination he said the proposal was discussed amongst the NGOs and he could not say that Mr Maitland advised them of "the strategy". [356] 2. Mr Jones' report also indicated that the NGOs would each receive 5% of profits annually which he said would, on projected tonnages, be "anywhere between $2.0m and $5.0m dollars per year". There was no evidence that Mr Macdonald was aware that the involvement of the NGOs was based on an understanding they would profit from that involvement. The memorandum of understanding with WRHS was not executed until 2010. [357] (Given the nature of the organisations, and the use that would be made of those profits, I do not mean to suggest that their receipt of funding from the mine necessarily told against the project.) 3. On 20 August 2007, Ms Tan emailed Mr Maitland and asked if the letters from the relevant institutions discussed at the lunch had been followed up by him. [358] On 31 August, Ms Tan sent an email to Mr Munnings asking that he keep "an eye out" for letters regarding training or skills shortages in the mining industry and to print a copy for her before providing it to the Department. [359] Ms Tan said she did this because she and Mr Macdonald were waiting for such letters, on the basis of conversations had at the Prime Restaurant lunch, or subsequent to it. 4. Also consistent with the Crown's assertion of a strategy, a number of letters were sent in the period following the Prime Restaurant meeting, although on Mr Macdonald's version, the letters were no more than interested parties advising of their respective positions. 5. By letter dated 8 August 2007, Peter Murray, General Secretary of the Mining and Energy Division of the CFMEU, addressed to Mr Macdonald, raised the union's interest in the training of mineworkers. [360] The letter indicated that the small number of traineeships in the underground industry was far outweighed by the demand for experienced workers, a problem which was expected to grow. The letter pointed to the growth of contract labour, which, it was asserted, created a problem due to contractors having no on-site training base. Reference was made to virtual reality training available through Coal Services but stated there was a "void in providing on-site facilities" for training in an underground environment. The letter stated, "the industry needs to develop an appropriate strategy". The letter did not refer to ResCo's proposal. While not referring specifically to an "underground training mine", the letter pointed very clearly to the need for such a facility. Mr Maher, in his evidence, had, no doubt, that the letter was referring to a training mine, stating that the letter was not discussed with him, it should have been, and should not have been sent because it was "contrary to our executive's position on the training mine". [361] Mr Macdonald, of course, did not know this. Mr Maitland, on the other hand, had met with Mr Maher prior to this point and been informed by him that the CFMEU was unlikely to support his proposal. [362] 6. Mr Macdonald said he had no particular recall of Mr Murray's letter, no expectation of receiving it, and did not make any connection between the letter and the meeting with Mr Maitland at the Prime Restaurant. [363] Mr Maitland agreed he requested Mr Murray to provide a letter. He said the request was in accordance with his discussions with Mr Macdonald to provide evidence of the claimed skills shortage. [364] 7. By letter dated 7 September 2007, Mr Jones as general manager and Cliff Marsh as chair wrote to Mr Macdonald explaining that the WRHS was community owned and provided services without charge. [365] The letter indicated a close relationship between the coal mining industry and the Service and noted that the Service had been required to attend accidents in what is considered to be one of the most hazardous industries. The letter indicated that there had been a lot of recent publicity in relation to "the expansion of the coal industry and the shortage of skills to meet that expansion". It pointed to the challenge this created for the Service with respect to its need for pilots, engineers and aircrew. The letter continued that the Service was currently considering a number of new training initiatives "which we hope to make public in the near future". The letter sought the support of the Minister once the new training initiative was finalised. 8. The letter was very largely based on a draft sent by Mr Maitland to Mr Jones. [366] There is no evidence this was known to Mr Macdonald. Mr Macdonald in his evidence said he had no recollection of the letter. [367] 9. By letter dated 12 September 2007, Milton Morris AO, as chair of the HVTC wrote to Mr Macdonald outlining the organisation and its role including its relationship with the mining industry and history of providing "innovative training delivery and services" to that industry. [368] The letter noted that the "ongoing expansion of this industry has placed serious strain on infrastructure for the supply of appropriately skilled and semiskilled workers". The letter referred to what appears to be the same report referred to in the Department's briefing note of 14 August. It is no criticism of Mr Morris, but unlike the briefing note, the letter does not detail action taken in response to the report as was set out in the briefing note. The letter sought continued government support for the training company in its efforts to assist the mining industry "meet the challenges which it faces in overcoming the traditional skill shortages". There is no indication of what form that support would take. 10. Mr Macdonald confirmed that he was familiar with the HVTC and Mr Morris, a former (Liberal) parliamentarian who had set it up as a not-for-profit joint venture between the government and industry. There was no issue that the HVTC was a significant stakeholder in relation to skills training in the Hunter Valley area. 11. By letter dated 18 September 2007, Professor John Carter of the University of Newcastle wrote to Mr Macdonald, stating "[a]s you are aware, there is a serious skills shortage in the full range of engineering disciplines and in particular those serving the mining industry" and that "[m]ore general training opportunities are also required at levels outside of tertiary training". [369] The letter stated that this need was "particularly acute" in the Hunter region. The letter promoted the University's history in developing skills solutions for industry, often in collaboration with external parties. The letter indicated interest in collaborating with the State government, engineering, manufacturing, mining and other technical fields to "alleviate barriers to the advancement of the economy of New South Wales and the continuity of sustainable, safe and efficient economic development" and requested a meeting with Mr Macdonald to advance this cause. This letter was emailed in draft to Mr Maitland who forwarded it to Mr Ransley and Mr Poole. 12. Mr Macdonald said that Mr Maitland had told him that "he would try and see if the institutions would be able to inform me in relation to skills in the Hunter" but that he "didn't know in particular who was coming or what was coming". [370] He said that he thought he would have connected the letter from the HVTC with the discussion with Mr Maitland about skills shortages but did not think they were part of any proposal. [371] 13. From Mr Maitland's expenses claim, it appears Mr Maitland met members of the Minister's staff (but not Mr Macdonald) on 26 September 2007 in relation to the letters. [372] 14. Subsequently on 5 November, a meeting took place between (according to Ms Tan) Mr Macdonald, Mr Maitland, Mr Plimer (a geologist from the University of Adelaide), Mr Glover from the University of Newcastle (although from the emails it may have been Mr Johnson from the University), Mr Coutts and Ms Tan. [373] Ms Tan emailed Mr Plimer confirming the meeting and advised that Mr Macdonald had suggested that Mr Maitland attend as he had been working on a training project and had links to the University of Newcastle. [374] She contacted Mr Maitland who asked for an outline of what was proposed. Mr Plimer sent an email, the contents of which were provided to Mr Maitland, stating: [375] "The skills shortage in NSW is extreme. The industrial base of Newcastle, The University of Newcastle and the proximity of the NSW Geological Survey at Maitland suggest there may be synergy for the building of a School of Mines in Newcastle funded by industry and DPI funds and to integrate with other training programs." 1. Mr Macdonald said in his evidence that he was interested in upgrading geology and in particular geoscience training in New South Wales and wished to involve Mr Plimer as he had a high regard for him. He invited Mr Maitland as he believed "the training mine concept could develop synergy with the university, particularly for studies in the sequestration field and that if there was potentially a synergy there, that might be beneficial to the university and the public". [376] Mr Macdonald was also aware that Mr Maitland had been talking to the University of Newcastle and said that Mr Maitland raised the possibility that the training mine could work in with the University. Mr Macdonald said that at the meeting, consistent with the evidence Mr Coutts had given, Mr Coutts said something to the effect that the Department was "not in favour of this" or "you know my views on this", referring to the training mine. [377] Mr Macdonald said he ignored this, essentially regarding it as inappropriate for a bureaucrat to express such a view in a meeting between the Minister and others. 2. Mr Coutts said that immediately after the meeting, he heard Mr Macdonald tell Mr Maitland that he needed "to get more support from industry … you need to get out there now and get some key players to back your proposal up". [378] Mr Macdonald agreed he told Mr Maitland his proposal needed more support in the community and in the industry. [379] 3. I would accept that Mr Macdonald was genuinely motivated to establish geoscience training at the University of Newcastle, an idea that appears to have arisen independently of the training mine proposal. It is also clear that he was well aware of Mr Coutts' view with respect to a training mine. Further consideration will be required as to the extent to which potential geoscience training supported Mr Macdonald's determinations. 4. In cross-examination, Mr Macdonald said he was not specifically pursuing the letters, but did think that if Mr Maitland was going to demonstrate a skills shortage, he would receive some indications. [380] He said he did not see a problem with the proponent for the training mine collecting letters of support and noted that he was also getting information from the Department. [381] 5. Mr Maitland in his evidence said that from his company's perspective they were asserting the existence of a skills shortage and believed that if they could get letters supporting this it would advance their proposal, but that "as far as Mr Macdonald was concerned, there was no strategy worked out between he and I". [382] 6. I find the letters discussed above were written at the instigation of Mr Maitland. That does not prove a "strategy" between the two accused, at least in the sense I apprehend the Crown used the term. There is, however, ultimately, little between the positions of the Crown and the accused in relation to this issue. While the Crown seized on the use of the word "strategy" by Mr Jones to provide a nefarious tone to the process, Mr Macdonald and Mr Maitland agreed that, as a result of their meeting, Mr Maitland was to provide evidence of the asserted skills shortage, and it appears he set about doing this. Insofar as it might be said that there was a "strategy" to avoid reference to the ResCo proposal, this was certainly Mr Jones' understanding, and was reflected in the letters, but, as discussed above, he was unsure as to whether any such "strategy" had come from Mr Maitland. The evidence does not establish it was a strategy devised between the two accused. Consequently, I am able to find no more than that Mr Macdonald sought evidence from Mr Maitland of a skills shortage and Mr Maitland set about providing it. Whether there was or was not a strategy with respect to the letters, Mr Macdonald in his evidence accepted that there were different views as to the presence and nature of any skills shortage in the Hunter Valley, at least as at August 2007. [383] In this context it must have been obvious to Mr Macdonald that any letters obtained by Mr Maitland would present only one view. I accept that Mr Macdonald did obtain independent advice from the Department. I have, however, already made an observation as to what he took from that advice. It might also be observed that around this time, specifically, on 22 August 2007, Mr Macdonald attended a meeting of the MMAC with Ms Tan. While other matters were raised by him at that meeting, nothing was raised with respect to any skills shortage. The evidence supports the inference that Mr Macdonald had little interest in coming to a real understanding of the actual nature and extent of any skills shortage in the Hunter Valley, or, as I will come to below, the extent to which the proposed training mine would address that issue. 11. The case in detail: Part 5 – DCM's Submission of 18 March 2008 (the second application with more detail), the response to the submission and its approval 11.1 The submission 1. From the perspective of the Ministry and the Department, little happened between December 2007 and March 2008. A table of outstanding issues kept by the Department listed Doyles Creek, indicating that the Department was waiting on a business case from Mr Maitland. [384] 2. A letter dated 18 March 2008, from DCM to Mr Coutts, under the signature of Mr Maitland, DCM renewed the application for consent to apply for an exploration licence, enclosing the ResCo letter of 15 February 2007, a letter from Opes Prime indicating their willingness to facilitate the raising of necessary capital, together with its submission, a 63 page document. [385] 3. An aspect to the context of this application should be noted. From the perspective of Mr Maitland and DCM there was an interest in talking up their prospects for the purposes of attracting investors, without which any project would fail. While this issue was not explored in the evidence, there would presumably be a difficulty in representing one thing to the Minister and an altogether different thing to investors. Further, it was also necessary to convince the Minister that the project was viable. But, as has been noted, relatively little exploration of the area had been done. These matters need to be taken into account when considering the proposal, including the volume of coal expected to be extracted. 4. The submission was titled "Training Mine Facility Submission". [386] The submission stressed the existence of a skills shortage, particularly in the mining industry, and the capacity of the training mine to contribute in this regard. In relation to training, the submission indicated: [387] "Applicants to the Training Mine will be screened via traditional interview techniques and aptitude tests, 50 trainee positions will initially be offered, comprising: 18 trade positions - 9 fitters and 9 electricians 32 mining positions - 25 trainee mine-worker, 5 deputy and 2 undermanager placements. From the fourth year of the Training Mine's operation, there will continue to be 104 trainee positions offered, as follows: 72 trade positions - 9 fitters and 9 electricians completing their first, second, third and fourth years of study 32 mining positions - 25 trainee mine-worker, 5 deputy and 2 undermanager placements. The duration of each course is as follows: Mine-worker - 1 year Deputy - 2 years Undermanager - 4 years Trade certificate - 4 years" 1. On this basis, once established, the facility would produce, yearly, 18 tradespeople, 25 mine workers, 2.5 deputies and 0.5 undermanagers. The submission also indicated that the University of Newcastle intended to employ a professor in Earth Sciences and the University would use the training mine for "practical and 'real life' application of research". [388] It did not, however, suggest that the University's intention to provide Earth Sciences education was contingent on the availability of the training mine. The submission also referred to training in horticulture and hospitality though no detail of this was provided. [389] 2. The submission indicated that 5% of net profit would be paid to a community trust fund. 3. While the submission was titled "Training Mine", I accept that the proposal was, in fact, for a significant commercial mine together with a training mine. Noting the reservations as to the estimates referred to above, the proposal indicated that the total in situ mineable resource was estimated at 125 million tonnes of soft and semi-soft coking coal at a depth necessitating underground mining. [390] From this, it was estimated 91 million tonnes could be mined over a period of 35 years. The proposal used an assumed value of $100 per tonne to calculate estimated royalties (at 6% of the value of recovered coal) to be $546 million. [391] On this basis, the total value of the resource, if the estimate of 91 million tonnes of coal proved to be correct, was $9.1 billion. Clearly, there is a significant difference between the value of the resource and profits. However, the proposal forecast earnings of $54.8 million by 2015 [392] suggesting that, after initial start-up costs, what was proposed was a mine which was expected to make a substantial profit over its 35 year life. The cost of establishing the mine was estimated at $209 million, with an additional $7 million required for the construction of the training facility. [393] The training mine facility was forecast to be cost neutral, presumably on the basis that once established, coal mined in the training facility would offset the cost of running the training facility. A diagram showing the conceptual mine plan indicated the location of proposed longwall panels. It also indicated the location of a "training panel" with a figure of 150,000 tonnes. [394] This appears to be the only reference in the document to the size of the proposed training panel. While Mr Maitland (supported by Mr Ireland, who was primarily responsible for the plan), [395] indicated that the 150,000 tonnes might last a year and, once exhausted, a new training panel would be commenced, as would be required by the conditions, [396] this was not indicated in the submission. 4. Mr Macdonald said that he read "most of" the submission. He said he was not sure if he read the geological part, "not being an expert in that part of it". [397] It is not clear what part he was referring to, there being very little that appears to be of a geologically technical nature, the submission relying on "independent geological advice" with respect to the potential presence of "structurally undisturbed blocks between faults" on which the tonnage was presumably estimated. 5. Mr Macdonald said he thought the document was "very impressive", "particularly in rendering a significant public good, particularly in the Hunter Valley" and was "rigorous in terms of outlining the need for a training mine and what a training mine would do together with detailing the partnerships with "very important Hunter Valley institutions". [398] There is no issue as to the nature of these institutions and that the partnerships added strength to the submission. Both Mr Coutts and Mr Mullard agreed that this was the case. [399] Mr Macdonald said he accepted that those partners all supported the idea that there was a skills shortage, particularly in the coal sector. Mr Macdonald was referred to the statement in the submission that "the concept of a training mine has previously been considered as having merit but has failed to gain traction due to a lack of long-term financial sustainability" and said that this identified the issue – it was necessary for a training mine to be self-funded. [400] 6. Mr Macdonald said he asked his staff to obtain a response from the Department. Mr Gibson gave evidence that Mr Macdonald told him it was a "good opportunity" and asked him to obtain advice "with a view to progressing it". [401] Mr Macdonald also apparently told him it would be appreciated if the Department's assessment of the submission could be provided expeditiously, [402] and Mr Gibson recalled there being a desire to see where the progress on the preparation of a briefing note was when he returned from overseas. [403] Mr Mullard also gave evidence that Mr Coutts and Mr Macdonald had wanted an urgent brief done. [404] 7. It appears from an email from Mr Munnings to Mr Gibson there was a meeting between Mr Maitland and, at least, ministerial staff on 8 April 2008. [405] There was, however, no oral evidence about this meeting. 11.2 The Department's briefing note of 13 May 2008 1. A briefing note in draft form dated 13 May 2008 was sent by Mr Coutts to Mr Gibson on 27 May 2008. Mr Coutts asked to be advised if any further information was required. Nothing further was sought and it appears that this was the final form of the briefing note. Mr Macdonald accepted he read it. [406] It is convenient to set it out in full (minus the annexure and adding paragraph numbers to the dot points for later ease of reference): [407] "Background: Mr Maitland has written regarding a proposal by ResCo Services Pty Ltd (ResCo) to establish a training mine in the Hunter Valley and seeks the granting of an exploration licence to support such development. His latest letter contains details on the proposed training mine and area sought. A brief summary of the proposal is attached at Annex A. They are seeking an exploration licence over a surface area of approximately 30 km2 adjacent to the Jerrys Plains township in the Upper Hunter Valley. Interest in the area has been expressed by other mining companies. The Minister's consent is required to apply for an exploration licence. The proposal suggests a total of 91Mt of coal would be removed from the mine, or 3.3 Mtpa, of which only 150,000 tonnes would be from the 'training panel' portion of the mine. Comment: Having reviewed the proposal there are a number of issues that need to be considered: [1] • The area in question is quite attractive and a number of companies apart from ResCo have expressed interest in the area, these companies include Atlas Coal, Simitar(sic) Resources and Independent Coal. The current policy would suggest that where there is strong interest expressed by a number of companies in a coal area then a competitive allocation process should be considered. [2] • ResCo Resources has only provided very limited information on the proposal and have not demonstrated the feasibility and viability of this proposal. They have indicated in their submission that they will conduct the feasibility studies once the resource has been allocated. This does not provide certainty to Government that the allocation of the resource would achieve the outcomes suggested by ResCo. [3] • For the training component to be successful it is important that there is broad industry acceptance regarding the suitability of the mining trainees. The ResCo proposal does not demonstrate that there is broader mining industry support. [4] • It should be noted that a number of other mines have training programs in place as it is now considered essential to meet workforce requirements for the establishment of new mines. It is not clear how this proposal would link in to such existing programs including the Coal Services Virtual mine training facility. [5] • The nature of the training at the mine will tend to be site specific for the type of mining conditions and equipment being used in this particular area of the Hunter Valley. As a result, such skills may not be directly transferable to other mine sites. [6] • The training component represents only a relatively small part of the overall proposal in that the proposal is actually for a major mining operation with a small training component included. This raises the possibility that once the mine has been established that the training component may be downgraded or considered not feasible in the longer term. [7] • The time required to develop a mine including undertaking exploration, feasibility and environmental studies, approvals and construction is 5 to 6 years. This would place any significant benefit from the training mine at least 5 to 6 years into the future. [8] • The area is adjacent to the Jerrys Plains township and there is considerable opposition to any expansion of mining in the region and it is likely that any proposal for a new mining development in the area would have considerable community opposition. The community is currently calling for a buffer zone around the township and is supported by the Singleton Council. [9] • Under the Departments Coal Allocation Guidelines the minimum financial contribution required for the allocation of the area would be in the order of $15 million for an underground resource. A competitive allocation could result in a higher return. There are a number of options for the allocation of this resource which could be considered. 1. A direct allocation to ResCo with strong conditions on the title regarding the requirement to establish and maintain a training mine component with penalty provisions should the company not achieve the stated outcomes. 2. An allocation of the area on a competitive basis with a requirement to establish a training program as part of any allocation of the area. 3. Allocation of the area on a competitive basis with the requirement for a cash component (in the order of $5m per annum) either as an upfront payment or as an annual fee over the life of the mine being directed towards the establishment of broader industry training programs. Recommendations: Given the level of industry interest in the area, that the Minister considers a competitive allocation process with a requirement to either establish a training facility or establish a broader industry training fund." 11.3 Events following the briefing note 1. After the briefing note was sent, there was contact between the Department and the Minister's office. Mr Coutts gave evidence of a conversation with Mr Gibson after the briefing note was sent. [408] He said Mr Gibson said something like the advice "wasn't along the lines that the minister would be expecting" to which he responded "[w]ell that's the Department's position, and if the Minister is not happy with the submission, then you should send it back to us with an appropriate note on the submission as to what the Minister wants us to do with it". He said this did not occur. [409] Mr Gibson said he spoke to Mr Coutts around this time. He said that he told Mr Coutts that the Minister was still in favour of a direct allocation, and Mr Coutts told him that the Department was still in favour of a competitive tender. [410] 2. As can be seen the Department raised a number of objections to the proposal. Mr Macdonald was taken to each of these objections. 11.4 The issues in the briefing note and Mr Macdonald's response 11.4.1 Dot points 1, 6 and 9 – the size of the mine 1. Perhaps the most significant of the objections was the size of the training mine, at 150,000 tonnes, when compared to the anticipated total of 91 million tonnes to be mined. This was raised under the background heading and in the sixth dot point. That objection is to be seen in the context of the interest of other companies in the area and the potential for a higher return from competitive allocation. Mr Macdonald was taken, in his evidence-in-chief, to the estimate of 91 million tonnes or 3.3 million tonnes per annum and said he regarded such a mine as being in the "sort of medium category". He was then asked: [411] "Q. The background continues, "By which only 150,000 tonnes would be from the training panel portion of the mine"? A. Yes Q. Did that mean anything specifically to you? A. No, not particularly." 1. Mr Macdonald was taken to dot point 6 and gave the following evidence: [412] "Q. In relation to the earlier part of that dot point that referred to the fact it was a major mining operation with a small training component, was that a matter that troubled you? A. I was of the view that the issue of the panel and - that is the underground panel - and the scope of the business would allow with - under conditions - for the department to have a strong say in the future of that particular panel, and I believe that with the integrity of the partners they had with them, the University of Newcastle and Hunter Valley training in particular, that there would be the - I don't believe that they would turn it into something other than a viable training mine." 1. In cross-examination, Mr Macdonald gave the following evidence: [413] "Q. You knew the training was only a small part of the overall proposal, correct? A. To some extent, to some extent." 1. With respect to the first of the above answers it is not clear why the relationship between 150,000 and 91 million tonnes was not meaningful to him. The second response, relating to the same issue, did not address the question. When returned to in cross-examination, Mr Macdonald's response "to some extent" again, does not come to terms with the issue. 2. When questioned about the total value of the resource based on the estimates of 91 million tonnes and $100 per tonne, there was the following exchange: [414] "Q. … And, you must have thought then that these were enormous sums of money, correct? A. Yes I thought the royalty figures in particular were impressive." 1. This answer was disingenuous. Any miner was obliged to pay royalties based on what was extracted. The figure may have been impressive if the coal to be extracted from the training mine was to be a significant portion of the total (as there would be royalties paid with respect to coal not part of a commercial operation). But this was far from what the proposal suggested. Again, Mr Macdonald's response failed to address the relative significance of the training mine compared to the commercial mine and the resultant forecast profits. 2. Additionally, it might be thought that the commercial mine was likely to benefit from the training of workers in the training facility. While presumably, some additional training would be required for the longwall operation, the training mine might reasonably have been expected to defray some of the training costs inherent in any mining operation, further diminishing the size of the training mine relative to the commercial mine. I accept, however, that this point does not appear to have been drawn to Mr Macdonald's attention and there is no evidence he considered it. 3. Further, in respect of the interest of other companies (dot point 1), Mr Macdonald said he had not heard of the companies referred to and did not see any familiar names. The implication is that the level of interest did not appear to him to be as significant a factor as it may have been. Even accepting this, however, potential interest in the site could not be dismissed. Further, there remained the possibility that other companies would come forward in the event of an expression of interest. Mr Macdonald did accept that, given the policy applying where a number of companies had expressed interest, a competitive allocation process should be considered. 4. In relation to the indication of the potential higher return through a competitive allocation (dot point 9), Mr Macdonald said: [415] "A. Well I - I thought that if the department was confident of a substantial additional financial contribution, they would have potentially stated that, and would have said it would be a substantial amount. In other documents that I was dealing with at this time, the department - or around this time - were indicating the sorts of amounts of money you could expect for some AFCs. I thought this was couched in these terms that it wasn't a substantial amount of money that would be drawn if it was put to an additional financial contribution or an EOI. Q. When you say "other documents" were you referring to any particular, as at May 2008, any particular area that had gone out to competitive tender? A. No, there was just - I read this sometime after that, after May into June, after I returned, and at that time we were discussing putting a number of one large scale resources to market, namely Narrabri and Ridgelands, and the department thought that we'd possibly get considerable sums in the order of the Caroona maybe, however, they weren't prepared to put them out to market due to the lack of data on those resources. Caroona and Watermark were quite different in that when they were presented to the market, they had considerable data collected from extensive boreholes. That gave a high level of certainty to the purchaser that they were buying next to a JORC resource - not a JORC resource but not far off it with - and the department in the end didn't put those out so we were also discussing a number of smaller resources at that same time, and they were talking figures far less substantial than Caroona and Watermark in relation to the smaller and medium size resources." 1. It can be accepted that Caroona and Watermark were very different. While there were both advantages and disadvantages as between Doyles Creek on the one hand and Caroona and Watermark on the other, it must be accepted that this was not spelt out in the note, other than perhaps by reference to the area being "quite attractive". (It will be recalled that Mr Mullard gave evidence the location in the Hunter Valley and the proximate infrastructure was significant when compared to the location of the Caroona and Watermark resources.) [416] Nonetheless, to treat the Department's failure to provide an estimate of any AFC as indicative of the fact that it was not expected to be substantial is surprising. What was clear from Caroona and Watermark was that the Department was surprised by the bids received. [417] Even if there was an expectation that the Department could give a reliable estimate, Mr Macdonald did not respond to Mr Coutts' invitation to ask if more information was required. 2. Even more significant, however, is Mr Macdonald's failure to acknowledge the discrepancy between the respective sizes of the training and commercial aspects of the mine. 11.4.2 The size of the training component based on the number of trainees 1. Although not entirely clear, dot point 6, while referring to the training component as a "relatively small part of the overall proposal in that the proposal is actually for a major mining operation with a small training component included", would appear to relate not only to the size of the training mine by tonnage, but also its size in terms of the number of trainees accommodated. In any event, consideration of the number of trainee positions was essential in order to give any proper consideration to the merits of the proposal and its capacity to address any skills shortage. 2. As noted earlier, on an annual basis the facility would produce 25 mineworkers, 2.5 deputies and 0.5 undermanagers, which adds up to a total of 28 mineworkers. Combined with the 18 trade graduates the total was to be 46 graduates each year. This is a somewhat blunt figure as there are varying skill levels within the 46 graduates (with correspondingly different training time), though in this regard the largest single contributor to the 46 graduates was to be the mineworkers who were also undertaking the shortest course. 3. The number of proposed graduates is to be compared against the figure provided in the Department's briefing note dated 13 August 2007 which advised that the MCA reported in August 2006 that approximately 5000 additional employees will be required by 2015 in the NSW minerals sector, with the greatest increases being in tradespersons and semi-skilled employees. [418] Mr Macdonald relied on Mr Buffier's evidence that only approximately 40 or 50% of the minerals sector work in underground mines (I presume, as opposed to open cut). [419] Mr Buffier's evidence was that even within the underground mine industry a portion of employees work on the surface, although in this regard he said that the majority were engaged underground. Given this and that something like about 50% of mine workers were engaged in coal mines, the proposed training mine was addressing a shortage of closer to 1000 to 1500. There is no suggestion, however, that Mr Macdonald engaged in this analysis. Rather, he agreed he had been provided with advice that referred to a shortage in New South Wales requiring approximately 5000 workers by 2015. Even if one were to take the figures based on Mr Buffier's evidence, by the time the mine was established, at the rate of 46 graduates a year, the training mine was still unlikely to have a significant impact. 4. Mr Lewis said that ResCo, through its labour hire services, would have had the capacity to absorb at least some, if not all of the 25 mineworker graduates each year. [420] While those workers would be available to the industry at large it rather suggests the production of trained workers was not entirely altruistic. There is, however, no evidence that this was pointed out, or otherwise occurred to Mr Macdonald. Irrespective of any benefit to ResCo, and while it can be said that every little bit helps, the number of trained workers to be produced by the training mine could only ever be regarded as a minor contribution to addressing any skills shortage. This is further to be seen in the light of the Department's advice setting out the response to the MCA report on the skills shortage in the industry. This has been discussed elsewhere, but in understanding the benefit of the number of graduates to be produced by the training mine it is necessary to appreciate that in response to the report, the MMAC had met with the Director-General of the DET and various initiatives had been put in place. 5. In addition to the above, there is a question as to the utility of the proposed training facility given its location in the Hunter Valley. The minutes of the MMAC meeting of 14 February 2006 record that Mr Macdonald was in attendance. [421] Mr Coates, then the managing director of Xstrata Coal and the chair of the MCA, provided a presentation in response to the previous request by the chair that members of the MMAC prepare brief initial reports on the training and skills issue. Mr Coates is recorded as saying that the skills shortage was "particularly a geographical problem" and "not a major problem with the coal industry in New South Wales, as the Hunter Valley has a good lifestyle for employees". Mr Macdonald acknowledged that he was aware in 2008 that this was a view held by at least some people within the industry, including Mr Coates, and potentially Mr Bloomfield from BHP, but said that this view was contentious. [422] The implication is that Mr Macdonald did not accept this position. Despite the sound logic in the attractiveness of the Hunter Valley in comparison with more remote mining sites, there was no indication of what evidence Mr Macdonald relied on to support the view that the Hunter Valley was similarly affected by the skills shortage. 6. It can be accepted that conditions would be available to ensure that the facility continued to provide training. I can also accept that any contribution to training in the context of a skills shortage would be of benefit. The point is that an analysis of the proposal suggests it would either have a relatively minor impact in alleviating any skills shortage or, alternatively, that any such skills shortage was not particularly significant at least in the Hunter Valley. Indeed, while Mr Macdonald initially denied that having around 100 trainees a year (from the fourth year) was not going to solve any skills shortage, [423] and said that it "could make a good contribution", [424] he agreed that having about 100 trainees yearly would not be enough to address any skills shortage then or in the near future. [425] (The more relevant figure is probably the annual number of graduates, which I have referred to above, as opposed to current trainees.) The number of skilled workers to be produced each year by the proposed facility, and its location in an area that was seen by at least some as less affected by the skills shortage, was, to my mind, a significant shortcoming in the proposal, and one that must have been obvious to Mr Macdonald. 11.4.3 The other dot points 1. In relation to dot point 2, Mr Macdonald noted that the purpose of the submission was to confirm the feasibility of the proposal. Mr Macdonald accepted dot point 3, that is, there was a failure to demonstrate broader industry support. In relation to dot point 4 he did not think that the presence of training programs at other mines was relevant as the training mine would be dedicated towards "cleanskins". [426] As to how the training mine would link in existing programs, he thought this was a "good point", but one that was open for discussion and negotiation with Coal Services and other providers. [427] 2. Insofar as dot point 5 raised a reservation as to the site-specific nature of the training, Mr Macdonald said that this needed to be tested, in that if industry showed interest it would be based on the transferability of skills. [428] 3. With respect to the delay (dot point 7) Mr Macdonald said this was not an issue for him as the proposal to build something significant for the public good would take time. [429] With respect to community opposition (dot point 8) he said that this would be an issue for the Planning Minister, but that should be further looked at. [430] 4. It can be seen in relation to these objections raised by the Department that Mr Macdonald acknowledged the need to gauge industry support and conduct further work with respect to how the training mine would link with existing programs. 5. Mr Macdonald said that having carefully considered the options and recommendations, he did not actually make a decision, but was inclined towards option one, as it was the only option that provided "a clear cut training mine". He said that if a project "demonstrated significant public benefits, that would then outweigh … the financial contribution that could be obtained from an expression of interest process". [431] Mr Macdonald said he did not accept the recommendation because: [432] "… as I've said in relation to [options] 2 and 3 - well, in this one you would have an EOI process for one, an expiration licence area, and secondly, potentially a training facility. Well, that could be another shed in which you stick a few virtual reality components in, or another broader industry training fund, so I didn't think they were getting to the heart of what I felt was going to make a significant contribution, and that was the establishment of a training mine, underground training mine." 1. Mr Macdonald accepted the exercise required the weighing of a number of factors. [433] The above answer, however, tended to treat one factor, the establishment of an underground training mine, as absolute, or at least as weighing more heavily than other factors. While Mr Macdonald did say that the significant public benefit of the training mine outweighed the AFC, [434] that could nonetheless be obtained by putting the area out for expressions of interest. The evidence was that the nature of the boom market extant at the time suggested it was not known what might have been received by way of an AFC. 11.4.3 Discussions with the Department following the briefing note 1. Mr Gibson said he attended a number of meetings between Mr Macdonald, Mr Coutts and sometimes Mr Mullard. He said Mr Coutts maintained that Doyles Creek should go to competitive tender, while Mr Macdonald maintained that the proposal had a strong public good. Mr Coutts confirmed that in discussions with Mr Gibson, the message was that Mr Macdonald was supportive of the proposal, and the view was conveyed that the Department was not, [435] however, his recollection was he did not speak directly with Mr Macdonald in relation to the briefing note. [436] 2. Mr Macdonald said that he discussed the matter with Mr Coutts who maintained his position that there should be a competitive process. While he accepted that Mr Coutts held this view, he did not share it and, as Minister, was not obliged to accept it. He did, however, consider that the areas of industry support and community views required further consideration and that the proponents should be briefed on the current status of the matter. [437] 3. Mr Mullard said he was acting in Mr Coutts' role when Mr Coutts went on leave after this briefing note, [438] and he consequently had meetings with Mr Macdonald. He said he was asked why the Department was not supportive of the training mine proposal. Mr Mullard said that he "basically explained that we were concerned that it wasn't a fair dinkum proposal", it seems on the basis "that the training component was quite small". [439] Mr Mullard said he also expressed his concern that it would fail without broad industry support and he suggested that Mr Macdonald seek the advice of the NSW Minerals Council. [440] Mr Mullard said he also raised with Mr Macdonald his view that the direct allocation of the resource was inconsistent with the Coal Allocation Guidelines. Mr Mullard said that Mr Macdonald in response said he could change the guidelines. [441] These discussions occurred in about June 2008. [442] 4. Mr Macdonald did not recall Mr Mullard using the words "fair dinkum" and said this was "a bit heavy for what he actually said to me". [443] Mr Mullard's evidence was expressed such that it was not clear that he used those particular words. Nonetheless, it is clear that Mr Mullard pointed out the discrepancy between the size of the training mine and the commercial operation. 5. Mr Macdonald also denied having said he would change the guidelines. [444] It is not necessary to resolve this issue. I would not draw any adverse inference against Mr Macdonald if he did say it. In any event, both witnesses were giving evidence with respect to events well in the past, and it is not surprising that the recollections of conversations might differ. However, what is clear is that the area was identified as a major stand-alone resource in the briefing note of 22 February 2007. While the guidelines had been updated there is no suggestion the mine was no longer in this category. Nor did it fit within any of the other categories. Mr Macdonald accepted it was clearly a major stand-alone mine. [445] The guidelines provided for allocation of major stand-alone areas to, ordinarily, be by tender or expression of interest. No doubt the Minister was not bound by the guidelines. However, a proposal which did not follow the guidelines might be expected to attract greater scrutiny. This is particularly so in the context of the Department's written advice and in circumstances where a senior member of the Department questioned the size of the training component of the mine. 11.4.4 Strangers' Dining Room meeting with Mr Maitland and Mr Ransley on 17 June 2008 following the Department's advice 1. Following the DCM submission in March and the Department's advice, a meeting was scheduled for dinner in the Strangers' Dining Room at Parliament House on 17 June 2008 attended by both accused, Mr Ransley, Mr Gibson and Mr Munnings. Mr Gibson said it was not unusual for the Minister to discuss business with stakeholders over a meal. He said that Mr Macdonald was sitting in Parliament prior to coming to dinner and returned to Parliament after dinner. [446] 2. Mr Macdonald said he provided a briefing in relation to the advice received from the Department. [447] He said he told Mr Maitland and Mr Ransley that he was very positive, "and that I would consider an invitation, but it would be subject to my satisfaction that it did indeed have industry support and that they … commenced a process of community consultation". [448] Mr Macdonald said how they achieved this would be up to them. He accepted that, at that meeting, Mr Gibson was nominated to collect any support that was provided to the Minister's office for the purpose of Mr Macdonald further considering the proposal. Mr Macdonald was aware that Mr Gibson liaised with the proponents for this purpose. [449] Mr Macdonald said it was normal, or "government 101" for a proponent to gather the endorsements required for their proposals. [450] Mr Rees and Mr Iemma agreed that such a course was not unusual. [451] Mr Macdonald did not agree that the prudent course would be to have an advisory council report on industry support rather than the proponent. [452] Mr Macdonald said it was "possible" that he discussed with Mr Maitland and Mr Ransley the Department's recommendation for a competitive process with a training program condition attached. [453] 3. Mr Maitland said he was not sure if Mr Macdonald told him at this meeting that the Department recommended a competitive allocation process with a requirement to either establish a training facility or to establish a broader industry training fund, but said the Department had, in any case, already made it clear to him that that was the case. [454] 11.5 Gathering support 11.5.1 Events immediately following the Strangers' Dining Room meeting 1. The day following the dinner in the Strangers' Dining Room, on 18 June 2018, Mr Gibson emailed Mr Munnings to advise him that Mr Macdonald had asked for Mr Maitland and Mr Ransley to be included in the list of invitees to the commissioning of the Munmorah Power station. [455] Mr Macdonald said he was attending with Mr Mullard. He saw it as an opportunity for Mr Maitland and Mr Ransley to meet with "industry people" and potentially have some discussions with Mr Mullard. He said he did not talk to Mr Maitland at the event. [456] 2. On 20 June 2008, Mr Maitland attended a meeting with Newcastle University. Notes from that meeting indicate that Mr Maitland reported on a meeting with the Jerrys Plains community. [457] The notes included "Councillor Paul Nicholls, Singleton very supportive" but also that others were highly critical of the scheme. The note also recorded "Risk to University – Jerry's (sic) Plains Community backlash potential substantial risk". [458] The note refers to the need for a media strategy and public relations. Under the heading "Approvals Process" it was indicated that ministerial approval was likely in "2-3 months". 3. On 24 June 2008, Mr Ransley emailed Mr Buffier and said, "we are just about there … [w]e should have an invitation within the next two-three weeks from the [M]inister". [459] The email advised that Mr Ransley was required to submit some letters of support from industry "as the final hurdle" and requested that such letters be sent to Mr Gibson. Mr Gibson's contact details were provided. Mr Macdonald was taken to this but denied indicating that the application would be approved or providing any timeframe, maintaining that he told Mr Maitland and Mr Ransley that he would consider approval if there was industry support and community engagement. [460] 11.5.2 The letters 1. Letters of support were sent to Mr Macdonald from: 1. Michael Buffier on behalf of Xstrata Coal, emailed on 26 June 2008; 2. Brian Flannery on behalf of Felix Resources Ltd dated 30 June 2008; 3. Peter Murray on behalf of United Collieries (on CFMEU Mining and Energy letterhead) dated 7 July 2008; 4. Colin Randall on behalf of Hydromining Coal Australia dated 1 August 2008; 5. Sharan Burrow on behalf of the ACTU dated 6 August 2008; 6. Brendan McPherson on behalf of Donaldson Coal dated 8 August 2008; 7. Ian Murray on behalf of Northern District CFMEU dated 22 August 2008; 8. Merv Mahon on behalf of the Retired Mineworkers Association dated 5 September 2008; 9. Geoffrey Pike on behalf of Sparke Helmore dated 23 September 2008; 10. Milton Morris on behalf of HVTC dated 23 September 2008; 11. Greg Combet, Federal Member for Charlton dated 24 September 2008; 12. Cliff Marsh and Richard Jones on behalf of WRHS dated 24 September 2008; 13. Kerry Hickey, Member of the Legislative Assembly for Cessnock dated 26 September 2008; 14. Stuart Barnett of Slater & Gordon dated 26 September 2008; 15. Nicholas Saunders on behalf of the University of Newcastle dated 29 September 2008; 16. Ray Barker on behalf of Skills DMC dated 29 September 2008; 17. Robert Coombs, Member of the Legislative Assembly for Swansea dated 29 September 2008; and 18. Gary Kennedy on behalf of Newcastle Trades Hall Council (undated). 1. The significant majority of the letters, as a general theme, referred to the existence of a skills shortage and the benefit of the involvement of the University of Newcastle, the HVTC and the WRHS. It was accepted by the Crown that the letters set out the genuinely held beliefs of the authors based on the information to which they had access at the time. While Mr Maher said the letters sent by Peter Murray and Ian Murray were contrary to the position of the CFMEU Executive, there is no suggestion this was known to Mr Macdonald. (I note here that the Crown and the accused agree that the letters were received by the Minister's office on or about the dates they bear and some of these letters were accordingly sent only after the consent to apply was granted on 21 August 2008.) [461] 2. Mr Macdonald said he was shown the letters by his staff. He said the letter from Mr Buffier was significant as he was, as an influential member of the NSW Minerals Council, and subsequent president, a "leader of the coal industry". [462] Mr Macdonald referred to Mr Flannery as "a very influential figure in mineral resources" involved in the Hunter Valley such that the views of Felix Resources were of significance as were the views of Mr Randall. Mr Macdonald said the most significant letter was from Ms Burrows, President of the ACTU given the role of the ACTU as the peak body for unionised employees with an involvement in national skills bodies. [463] Mr Macdonald said that he had regard to all the letters sent to him, and that together, they were significant as a training mine that had little support from institutions, employers and employees would not succeed. [464] 11.5.3 Seeking support of the NSW Minerals Council 1. The nature and role of the NSW Minerals Council has been discussed above. Dr Williams, as CEO, said she was approached by Mr Maitland, who presented a proposal for a training mine to her in "2007, 2008". [465] She said he told her he had the support of entities including the University of Newcastle, the HVTC, the WRHS, and that the project also had the support of the Minister. [466] She said Mr Maitland told her there would be a limited amount of coal mining to cover the costs of the operation, but the purpose of the mining was not for making a profit. [467] She said she told Mr Maitland that she was not in a position to support a training mine and that any support would need to be approved by the Executive Committee of the NSW Minerals Council. [468] I note that the Crown case is that Mr Maitland misrepresented the nature of the project to Dr Williams. It is, however, difficult to see how this advances the Crown case. The most that can be said is that it would not reflect well on Mr Maitland, and to that extent would tarnish his evidence of good character. In any event, the NSW Minerals Council Executive Committee meeting papers setting out the background for the purposes of its meeting, discussed further below, made clear that they understood that what was proposed was a commercial operation. 2. Dr Williams said that she met with Mr Macdonald on a regular basis. She said that in 2008, at a point in time after the approach of Mr Maitland, Mr Macdonald told her that "safety was extremely important and it was vital that the industry support a training mine to improve safety in the industry". [469] Dr Williams indicated the issue of support for a training mine would require approval of her Executive Committee. She said that Mr Macdonald raised the matter with her again including in telephone calls at 7:30am and on a Sunday evening, telling her that it was important that the NSW Minerals Council support the training mine. She said it was also raised in meetings with Mr Macdonald at Parliament House or Governor Macquarie Tower. Dr Williams said she felt she was "being lobbied by the Minister rather than the normal process of me trying to lobby him". [470] 3. Mr Macdonald agreed that he met with the NSW Minerals Council on a reasonably regular basis, and in the course of this raised with Dr Williams that he was looking at the establishment of a training mine and asked her if, in the event they thought it was a good idea, they could support it. He confirmed Dr Williams told him that she would have to refer it to her committee. He agreed he also spoke to her on the telephone although he did not recall telephoning at the times indicated by Dr Williams. He said she told him the matter was still to go to her committee. He denied that he was "lobbying her" for support. He said he was "seeing what the attitude of the Minerals Council was for the proposal" and that he had "done that on numerous occasions on … many issues with Dr Williams". [471] 4. The issue went to the NSW Minerals Council Executive Committee on 11 September 2008 (a date after the grant of consent on 21 August). The issue appears to have been discussed on the basis that the proponent was seeking to establish a fully operational coal mine where "a purpose of that mine will be to operate as a 'training mine'", [472] although the meeting papers made clear that it was understood that the mine would be "commercially sustainable", with a "budgeted production of two million tonnes of coal a year". [473] The meeting papers also referred to "part" of the profits of the commercial mine being used to fund the training mine. The Executive Committee noted that the matter was a "ministerial pet project" and that a lot of political pressure was being applied, with the Minister asking the NSW Minerals Council to support the project. 5. The minutes of the Executive Committee recorded that the general consensus was that if a company wanted to start a training mine it was "their affair", and that with respect to Doyles Creek it was a matter for government as to whether an exploration licence should be granted, although, if granted, the company should be self-funded and not seek funding from Auscoal or Coal Services. [474] It was noted that the NSW Minerals Council had a potential conflict of interest. From the meeting papers, this appears to be on the basis that requests for member company commitment to using the training services were likely and that Auscoal and Coal Services may consequently become contributors, leading to a conflict of interest, having regard to Coal Services' investment in virtual reality technology. While applauding initiatives designed to assist the shortage of skilled workers, the minutes stated that "such a commercial venture required serious evaluation". In other words, despite the pressure, and while acknowledging potential benefits, the NSW Minerals Council decided it would not voice its support for the proposal. It was resolved that a draft response would be circulated to the Executive Committee for approval before sending. It appears that a draft was prepared, however, it is unclear that it was sent. The draft indicated that while applauding initiatives designed to assist with the shortage of skills, "it is the policy of the NSWMC to decline support for specific commercial ventures". [475] 6. With respect to the difference in the evidence of Dr Williams and Mr Macdonald as to whether Mr Macdonald was "lobbying" Dr Williams the matter is, perhaps, a matter of perception. However, the repeated approaches of Mr Macdonald in person and on the telephone (a matter which is not in dispute, even if the time of some calls was not conceded) is more consistent with lobbying than simply enquiring as to the NSW Minerals Council's view. The latter could have been obtained with a simple letter or at a routine meeting. The unusual nature of being lobbied meant that it was something likely to stick in the mind of Dr Williams. While I accept that Mr Macdonald, in general, was energetic in his approach to his role, the description in the NSW Minerals Council minutes of the training mine as a "Ministerial pet project" and the statement that there "is a lot of political pressure being applied" [476] leave me in no doubt that Mr Macdonald was pressing the NSW Minerals Council to support the mine (despite the limitations referred to above in resolving a dispute where the evidence is in the form of transcript). 7. Mr Gibson, in his evidence, recalled a meeting between Mr Macdonald and Dr Williams at which he was present. He said it was in late August or September 2008, after the consent to apply had been issued. He said Dr Williams indicated that the NSW Minerals Council's position remained unchanged, and it did not support the proposal. [477] In contrast, Dr Williams said she did not directly communicate the Council's position to Mr Macdonald. [478] 8. Mr Gibson said that Mr Macdonald was not overly concerned at the response from the NSW Mineral's Council because some companies which were also members of the Council had individually indicated their support. [479] It might be noted in this context that Dr Williams' evidence was that there were 11 or 12 mining companies represented on the NSW Minerals Council (though I accept that they were not all necessarily involved in coal). [480] 9. Mr Macdonald did not recall speaking directly to Dr Williams after she had received a response from her Executive Committee. This was consistent with the evidence of Dr Williams. Mr Macdonald said that at some point his staff were told that the NSW Minerals Council had advised it could not support a particular commercial venture but they were supportive of initiatives that would enhance training. [481] This is consistent with what was indicated in the draft letter from Dr Williams to Mr Macdonald (although it appears, never received by Mr Macdonald). 11.5.4 Conclusion with respect to the process of obtaining support 1. There is no doubt that a significant number of organisations expressed support for the proposed training mine. What was being sought, however, was consent to apply for an exploration licence to establish a commercial mine together with a training mine. That the training mine might be seen by many as a good idea was certainly a matter Mr Macdonald, as Minister, was entitled, indeed probably required, to take into account. Ultimately, however, that support could not, of itself, justify the decision (and Mr Macdonald did not suggest that it did). The decision needs to be analysed on the basis of all the information known to Mr Macdonald. That information, importantly, was not necessarily the same as that known to those writing the support letters. Nor were their responsibilities the same. 2. With respect to the NSW Minerals Council, it is clear that the Council did not support the proposal. That is not to say that the Council opposed it. In one sense, the position of the NSW Minerals Council might be regarded as neutral, and the evidence benign. A significant aspect of the evidence, however, is in the active role taken by Mr Macdonald in pressing Dr Williams to obtain the Council's support, in circumstances where that support would be significant in providing justification for the project. Further, the fact that the indications of industry support had come from individual companies rather than the representative body clearly weakened DCM's position. Mr Macdonald's willingness to, effectively, skate over this points to a determination on his part to grant the proposal. Of course, a determination to grant the proposal is not inconsistent with a positive personal view as to the merits of the proposal. Viewed with other evidence, however, it may support an inference of a determination to grant the proposal other than on merit. 11.6 Release of other areas 1. It is convenient at this stage to set out the evidence of efforts to have other areas released for expressions of interest in the period leading up to DCM being granted consent. 2. In a cabinet minute finalised on 26 June 2008, funding was sought to enable the Department to carry out a drilling program to identify coal resources. [482] The cabinet minute anticipated that by providing greater information to industry there would be a better return to government on areas put out to tender (as occurred with Caroona and Watermark). Mr Macdonald confirmed that $12 million was sought but the proposal was ultimately not approved. [483] Treasury indicated they would not support it, consistent with Mr Iemma's evidence in this Court, regarding the tightening around expenditure at that time. This limited the prospect of the Doyles Creek area being released with more information obtained by the Department, at least in the near future. Despite this, the lack of information in relation to Doyles Creek did not appear to affect the view of Mr Coutts or Mr Mullard with respect to their preference for a competitive release (as opposed to simply doing nothing). 3. Despite the failure to obtain funding for exploratory drilling, Mr Macdonald requested Mr Gibson to obtain from the Department a list of areas that may be available for competitive tender. [484] Mr Gibson said it was communicated to him that Mr Macdonald was a strong advocate for the mining industry and that further coal allocations would be beneficial to the budget, for regional employment and there would be "the flow-on effects that come with mining in regional areas". [485] A table was prepared setting out various locations, the estimated resource and type of coal, its depth, an indication of the extent of exploration and additional comments. The list, containing about 50 locations, was prepared by Mr Mullard and provided to the Minister's office on 31 July 2008. [486] Included in the list was Jerrys Plains with an indication of 250 million tonnes by way of a small open cut and large underground mine. It was noted in the comments that the open cut mine may not be viable due to the proximity of the Jerrys Plains township. The exploration column was left blank. Mr Mullard said that, while there were some drill holes, they were extremely limited, and not even "to the level where we had an estimate of spacing, so I think there might have been one or two". [487] (I note there is some evidence, referred to above at [234], that there were five.) There was no explanation in the evidence of the basis for the 250 million tonne figure. The table itself indicated that all tonnages were indicative of resource potential only. No doubt there was a question about the reliability of the Doyles Creek figure given the paucity of drill holes in the area. On the other hand Mr Mullard had explained that coal was unlike other minerals in that it is broadly known where it is, although how effectively it might be mined and its quality is not known. [488] 4. Mr Mullard said in his evidence that Mr Macdonald asked him to prepare a list of smaller allocations that could be released. This was on the basis that there were a number of smaller mining companies unable to compete with the larger companies in relation to areas like Watermark and Caroona. The areas were to be released on a "restrictive competitive basis" in that the process was limited to small companies invited to apply. [489] 5. In August 2008, the Department released the expression of interest information document in relation to 11 areas. [490] The information pack advised of the number of boreholes in each area, the required financial contributions pursuant to the Department's guidelines and an additional financial obligation by way of a one-off contribution to the Department for the purposes of funding future exploration. Ten of the 11 areas were areas identified in the list of about 50 areas sent by Mr Mullard on 31 July 2008 (although the original list referred to "Vickery", and what I assume was a corresponding or at least related area in the list for release was "Vickery South"). (I note there is also one entry in the longer list for which the area name was not printed which could correspond to the eleventh area.) 6. It was submitted on behalf of Mr Macdonald that given there were three areas from the 11 that were in the Hunter Valley it was not true to say that coal resources in the Hunter Valley were as "scarce as hen's teeth". Further, evidence was given that in relation to one of these areas, Spur Hill, the competitive process resulted in an allocation without any AFC (although there was a required contribution of $1.5 million towards the Department's exploration fund, [491] and an indication that some payment may be made on receipt of a mining lease, [492] although the uncertainty as to this is such that it should be put to one side). In relation to the 10 areas for release that can be identified in the list of areas sent by Mr Mullard on 31 July 2008, the Department's estimates of the size of the resource and its nature are available. One was estimated at 20 million tonnes (albeit open cut), another, Glendon Brook at 150 million tonnes, and Spur Hill was estimated at 20 million tonnes open cut and 100 million tonnes underground. Across the other 10 areas for which information from the 31 July list is available, one other was estimated at 20 million tonnes open cut and 100 million tonnes underground. Otherwise, none of the other estimates exceeded 100 million tonnes. All of the areas were thermal coal, some domestic, some export and some both. 7. Based on the estimate in the DCM proposal of 91 million tonnes, the allocation of Spur Hill, with an estimate of 120 million tonnes without an AFC might be thought to provide some justification for the direct allocation of Doyles Creek, particularly with the added benefit of the training mine. However, comparison is difficult. The Doyles Creek resource was thought to include soft and semisoft coking coal, which was considerably more valuable than the thermal coal at Spur Hill. While there was less drilling done at Doyles Creek as compared to Spur Hill, the estimate in the Department's list placed the Jerrys Plains resource at 250 million tonnes and thus significantly greater than that at Spur Hill, noting that the potential mining area described as "Jerrys Plains" was not the same as the Doyles Creek area sought by DCM, and according to Mr Macdonald (and not contradicted) was considerably larger. [493] 8. The evidence in relation to the Department's list of 31 July 2008, and the release of the 11 small areas, while of relevance, does not significantly advance the case. The list of 31 July serves to underscore the fact that Doyles Creek was considered to be one of several areas that was worthy of consideration for competitive tender, and further that Mr Macdonald was acutely aware of budgetary concerns and the potential to take advantage of the booming coal market to address those concerns. While there were 14 areas in the Hunter and Newcastle area identified in the 31 July list (and three in the areas for release), I would not rely on that fact to find that coal in the Hunter Valley area was not regarded as scarce. There is a relativity to the concept and ultimately the evidence was that substantial unallocated sources of coal in the area were regarded as scarce. Mr Maitland's "briefing note" of 22 January 2007, raising the issue of an underground training mine in the "Newcastle/ Hunter Valley coal mining region" acknowledged that "[a]lmost all good quality, known-brand reserve areas, which are considered to be economically viable, are under title". [494] Mr Lewis, in his evidence, said that the Hunter was historically a very desirable location for mining, and did not dispute the description that coal resources in the area were as "scarce as hen's teeth". He also agreed the Doyles Creek area was the last large resource available in the area of which he was aware in 2008. [495] 9. To the extent that Spur Hill did not result in any AFC, there was, against that, a competitive process that provided some satisfaction the resource was not undersold. The Department's report indicated that it had assembled an evaluation team from experts within the Department and elsewhere in government, "overseen by an external probity auditor to ensure the highest levels of consistency, fairness and probity are achieved". [496] At the least, the evidence supports the contention that, despite the lack of exploration, in the context of the then coal market it could be expected that some meaningful justification would exist for any decision to directly allocate the resource. The case turns on the nature of this justification (the training mine) and the inferences that can then be drawn. 11.7 A failure to refer to advisory organisations or Cabinet? 1. As discussed above, there were various bodies within the coal industry with a capacity to provide advice. It should first of all be noted that the NSW Minerals Council, as an industry organisation that effectively provides lobbying services for mining companies, was not an advisory body as such; it was in a position to provide the views of industry. It should therefore be stressed in favour of the accused that there was an approach to, at least, this outside body. The result of that approach and its significance has been discussed above. 11.7.1 Mine Safety Advisory Council 1. It will be recalled that the Department's briefing note of 22 February 2007 recommended that Mr Maitland's initial proposal be referred to the MSAC. Mr Macdonald said he was not inclined to do this as he did not wish to refer controversial issues to a tripartite body such as the MSAC where it may cause divisions and, in any event, the proposal was, at that time, undeveloped and he was not inclined to approve it. 2. On 4 February 2008, Mr Macdonald's office issued a media release indicating that Mr Macdonald had welcomed the MSAC's "action plan" to enhance mine safety across the State and its backing of the Wran mine safety review. [497] In the media release Mr Macdonald congratulated "all on the high level of cooperation achieved on this issue". This tends to suggest the issues dealt with were controversial, or at least not straightforward, although this was not put to Mr Macdonald. Mr Macdonald said he had only a vague recollection of this press release but that the action plan was concerned with the issue of fatigue and long hours. [498] Nonetheless, the existence and role of the MSAC must have been appreciated by Mr Macdonald. 3. Returning to Mr Macdonald's reasons for not referring the proposal to the MSAC, the undeveloped nature of the proposal was, largely, rectified by the March 2008 proposal. Shortly after that proposal was submitted, Mr Macdonald, on 12 May 2008, gave a speech at the NSW Minerals Industry, Occupational Health and Safety Conference. The speech notes were tendered. [499] They indicate that Mr Macdonald noted that the MSAC had been revitalised, had provided him with important advice and oversees initiatives on his request. He noted that the MSAC commissioned a study project to look into the occupational health and safety (OHS) implications of production bonuses and safety incentive schemes, hours of work and fatigue management, and consultation and the lack of connection between some workers and OHS management systems. The notes indicate Mr Macdonald had asked the MSAC to oversee implementation of the resulting plan, to "drive the change agenda, and to encourage industry to get on board". Given the timing of this speech, Mr Macdonald must have been conscious of the role of the MSAC, and its capacity to advise with respect to the training mine concept at the time he was considering the March submission (particularly in the light of the Department's advice of 22 February 2007). 4. While the advice received from the Department on 27 May 2008 did not renew the previous recommendation to refer the proposal to the MSAC, this did not preclude Mr Macdonald from doing so. The absence of any such recommendation from the Department must be seen in the context of the Department having made a previous recommendation which was not taken up. From the Department's perspective it is understandable that it would not repeat advice already given. From Mr Macdonald's perspective, there was no reason that this should not have remained an option. Despite a contrary suggestion in his evidence, [500] I am satisfied that as an experienced minister, Mr Macdonald must have understood that he was not limited by the options provided to him in a briefing note (or in this case, the most recent briefing note). That is, he must have understood that the decision was for him as the Minister to make, and that he was not limited by the assumptions, imagination or breadth of vision of those advising him. 5. There were potential advantages to real-life underground training, and more relevantly, it was open to Mr Macdonald to have this view. There is also no doubt that there were a number of issues surrounding the training of mine workers ranging from the desirability, and perhaps necessity, for individual mines to conduct their own training to the availability of more general training using techniques including mine simulation. With respect to simulation, advances in technology were likely to have had an impact on different stakeholders' views on the effectiveness of this as a means of training. The point is that there was a valuable resource available in the MSAC given its availability to provide an informed opinion with respect to the proposed training mine. 6. As I have already indicated, it is difficult to accept that the potentially "controversial" nature of the concept was a sound basis for not referring it to the MSAC. I accept that Mr Wran in his report referred to a "debilitating distrust between the members of the tripartite process at all levels". [501] Mr Mullard also accepted that there was quite a deal of disagreement about health and safety implementation in the industry in New South Wales at the time of this report. [502] However, the MSAC, while apparently based on the old Mine Safety Council, was established under new legislation to address the concerns raised by the Wran report. Further, Mr Macdonald said the proposal was controversial in the context of a number of the companies on the various committees endeavouring to de-unionise and this "sort of issue would have been … inflammatory to put before some of the representatives on those committees". [503] While Mr Maitland's union background was well-known, the selling point of the training mine was that it was being put forward as part of a commercial operation to be run by a mining company. Perhaps more significantly, it was always acknowledged that, if the training mine was going to work, it required the support of industry. It seems odd then, that a referral to a tripartite committee would be avoided because it might not be well received by industry representatives on the committee. 7. In addition to the above, I note that the Department did not raise any such concerns (and indeed had recommended the referral). Nothing was said at the time to suggest it was a concern. Moreover, Mr Macdonald acknowledged that in May 2007 the MSAC had been looking at potentially controversial matters and there was no suggestion that this had created any difficulties. [504] 11.7.2 Minerals Ministerial Advisory Council 1. As discussed above, the MMAC was a body established by Mr Macdonald, chaired by Mr Papallo, who had no experience in mining, but was otherwise comprised of CEOs and very senior individuals from industry, unions and the Department. Having been established by Mr Macdonald in 2005, it was presumably intended to address some of the problems identified in the Wran report which was published in February 2005. Mr Coutts gave evidence that it had the issue of the skills shortage on its agenda. [505] 2. The MMAC met on 19 June 2007. Item 6 on the agenda was a progress report from the training and skills subcommittee. [506] According to the minutes, [507] Mr Bloomfield (the then president of Illawarra Coal, BHP Billiton, who was tasked to chair a subcommittee to look specifically at the skills shortage in the industry) [508] reported that the training and skills task force was not active and that the skills shortage had "eased somewhat, especially in the Hunter region". The chair, Mr Papallo, informed the MMAC that the Minister had asked the Council to be "active on this item" and asked Mr Bloomfield to contact the DET and to "obtain a progress report on Training and Skills issue". Mr Coutts said this was an accurate reflection of what was discussed. [509] Mr Macdonald said he did not actually recall asking Mr Papallo to be active on this item, but it was possible he did. Mr Macdonald said he was unaware that the MMAC had formed a subcommittee on training and skills. Nonetheless, as noted above, Mr Macdonald accepted that some people in the industry held the view at that time that the skills shortage was not an issue in the Hunter Valley although he said there was no consensus as to this. [510] 3. A meeting of the MMAC was held on 22 August 2007. [511] This was some three weeks after the meeting at the Prime Restaurant. Mr Macdonald attended together with Ms Tan as guests. The previous minutes were approved, although there is no suggestion that Mr Macdonald read them. The minutes of the August meeting recorded an invitation to members to attend the launch of the TAFE NSW mining strategy to be held on 15 October 2007. Mr Macdonald was recorded as having noted the need for the coal industry to work together on progressing proposed port expansions at Newcastle. The minutes recorded Mr Macdonald discussing clean coal technology, the Protection of the Environment Operations Act 1997 (NSW), the mineral industries campaign, future NSW power requirements, and, it appears, he responded to concerns with respect to two ongoing coal inquiries. Mr Coutts, who was present at the meeting, confirmed there was no mention of a training mine. [512] Mr Papallo said the training mine had never been discussed by the MMAC although it appears the concept was raised by Mr Murray in February 2006. [513] This pre-dates Mr Maitland's proposal, the reference appears to have been brief and it is not surprising that Mr Papallo had no memory of it. Ms Tan said she could not recall Mr Macdonald referencing the training mine at either this meeting or other meetings of the MSAC or MMAC. [514] 4. It is noteworthy that, despite stressing the need to the coal industry to work together on one particular matter, and discussing a number of issues at this meeting, Mr Macdonald did not raise any issue with respect to the establishment of a training mine which was likely to be of interest to the MMAC. Further, the absence of engagement with the MMAC or other organisations and in particular TAFE on the issue is surprising, especially in the context of TAFE's role in the area, even if Mr Macdonald was unaware it was launching a mining strategy. 5. Mr Macdonald said that as at August 2007, he did not have a proposal that could be put to the MMAC, presumably based on his view that the existing proposal was inadequate. He added that he would not, in any event, have put a training mine to the MMAC. [515] He said that it was not the sort of issue "that was envisaged when I constituted the committees" (which I take to be the MSAC and MMAC) and, as noted above, that one of the reasons for not referring it was his policy to not send controversial matters to the Council. [516] Even if one accepts Mr Macdonald had this policy, he was effectively left with only the proposal, the departmental advice, his own view of the proposal and the letters of support to assist with his assessment of the application. 11.7.3 Coal Services 1. As noted above, Coal Services was a statutory monopoly responsible for mines rescue, the provision of health-related services such as rehabilitation after injury, and workers compensation. Coal Services had developed virtual reality training centres based on technology developed with the University of New South Wales. Given their role, Coal Services, it can be presumed, would be interested in other training options, potentially with a view to coordinating between their services and outside training. Indeed, the Department's briefing note of 27 May 2008 raised the issue of how the proposal would link in with such existing programs. When taken to this in his evidence, Mr Macdonald accepted it was a "good point" but one that was open for discussion and negotiation with Coal Services and other providers. While there was a reference to Coal Services as a "strategic alliance member" in the proposal, there was nothing to substantiate any particular relationship established with Coal Services. Despite the role of Coal Services and the need for coordination acknowledged in the Department's briefing note, no attempt was made by Mr Macdonald to engage Coal Services with respect to the training mine proposal. 11.7.4 Cabinet 1. The Crown also relied on an asserted failure by Mr Macdonald to take the decision to Cabinet, or alternatively, to the Budget Committee or its subcommittee, the Expenditure Review Committee. Mr Macdonald was, at the time, a member of Cabinet, which generally met weekly. Mr Iemma said that matters brought by ministers were discussed, such as policy issues, programs and projects as well as general political discussions. [517] Certainly, Mr Macdonald could have taken the decision to Cabinet. Whether he was obliged to take the decision to Cabinet is more difficult. Evidence was given by Mr Iemma, Mr Rees, Mr Costa, Ms Smith and Mr Della Bosca with respect to matters that were required to go to Cabinet. Ms Smith gave evidence that a minister who wanted to know what matters needed to be brought to Cabinet would consult page 32 of Section 3 of the Ministerial Handbook titled "Matters to be Brought to Cabinet" and have discussions with the Premier. [518] Mr Iemma gave evidence that he would also have expected ministers to take guidance from a document titled "Cabinet Conventions: NSW Practice", which was attached to a Premier's Memorandum circulated to all Ministers in June 2006 and provides a list of matters requiring the consideration of Cabinet. [519] This list included "[p]olicies and commitments with a significant financial impact". [520] Mr Rees said that there was no threshold amount as to what would be considered a "significant financial impact" and indeed, that it would vary according to the circumstances of the budget. [521] Mr Macdonald, in cross-examination, did not accept that forgoing a potential AFC by granting a direct allocation to DCM meant that he was required to take the matter to Cabinet. [522] This appears to be correct. The financial impact of the decision to grant the consent was unknown. Given the uncertainty, it may have been prudent to refer the matter to Cabinet. Further, to the extent that there was potential controversy surrounding the decision, given Mr Maitland's background, had Mr Macdonald chosen to err on the side of caution he may have done so. While the reference to potential probity issues was not repeated by the Department after its briefing note of 22 February 2007, Mr Macdonald was clearly aware of Mr Maitland's background and can be expected to have been aware of the potential question this might give rise to in the event that a decision was made in his favour. This is more particularly so when one has regard to the expression of interest information packages and press releases with respect to Caroona and Watermark, which stressed the integrity of the process of determining the allocation, including the presence of a probity auditor. [523] (In fact, in a Ministerial briefing note concerning the expression of interest process for the Watermark Coal Exploration Area dated 19 January 2008, Dr Sheldrake had handwritten a note next to his signature addressed to Mr Macdonald that a draft press release will be prepared and that the press release "should highlight the strong probity aspects". [524] ) 2. In his evidence, Mr Macdonald said it was not a practice to put exploration licences before Cabinet. [525] Mr Iemma said he could not recall such decisions coming before Cabinet or being the subject of a Cabinet Minute. [526] Mr Della Bosca also gave evidence that in his time as Minister, he could only recall an exploration licence being brought to Cabinet on one occasion and that was by Mr Macdonald himself, who had referred to the considerable revenue brought in by exploration licences. [527] On the evidence the only exploration licence that appears to have gone to Cabinet was with respect to the Cobbora resource. I accept that the circumstances of the Cobbora allocation were very different. It involved a 1 billion tonne resource and what was described as a whole of government decision to gain certainty with respect to coal supply to particular energy producers. 3. While the matter did not go to Cabinet, Mr Iemma did give evidence of a conversation with Mr Macdonald around the time of the press conference for the Watermark announcement, which he did jointly with Mr Macdonald. He said it was a general discussion about Mr Macdonald's portfolio. He recalled Mr Macdonald saying that things were going well and "that there was a reference, in passing, that, as an example, there was good support from industry and the unions for a training mine and it was a good measure for safety purposes". Mr Iemma responded that it was a good idea and the discussion moved on. [528] Mr Macdonald said there were a "a few more sentences" to the discussion. Mr Macdonald did not recall whether he referred to there being a direct allocation of the consent. [529] Whether or not that was the case, it is clear that insufficient information was provided to Mr Iemma for him to come to any informed view of the proposal. 4. I am unable to find that there was a policy which directly required the matter to go to Cabinet. Similarly, given the uncertainty as to the financial impact of the decision, I do not find that there was an obligation to take the matter to the Budget Committee or its subcommittee, the Expenditure Review Committee. These committees were concerned with tracking the government's expenditure and progress against the budget and considered matters such as raising, reducing or forgoing revenue and policies and commitments with a significant financial impact. Again, there was no certainty as to the financial impact of a direct allocation. 5. There would have been a clear benefit in taking the matter to Cabinet and prudence would have dictated such a course. The failure to take that course cannot not, however, establish any more than a lack of prudence on the part of Mr Macdonald. It is not a circumstance on which I would place weight. 11.8 The grant of the consent 11.8.1 Mr Macdonald's decision 1. By letter dated 21 August 2008, Mr Macdonald, as Minister, wrote to Mr Maitland, as executive chair of DCM, granting consent to apply for an exploration licence over the area sought. The Crown relied on the writing of the letter by the Minister's office, rather than by the Department which was the usual practice, as well as the terms of the letter, as part of the circumstances tending to establish Mr Macdonald's guilt. The terms of the letter were as follows: [530] "Thank you for your letter and submission of 18 March 2008 concerning the proposed Doyles Creek Training mine located near Jerry's Plains. I am advised that the University of Newcastle, the Australian Council of trade Unions, the Westpac Rescue Helicopter Service along with several mining companies have given their support to our proposal. I am also advised that the NSW Minerals Council is currently considering the proposal and I expect their advice shortly. I am aware that a number of their members have already indicated their support, and that the Minerals Council of Australia has recently renewed their call for safer work environments in the mining industry and has forecast a significant shortfall in skilled mining industry workers over the next 12 years at a time when Australia is experiencing strong growth in the mining sector. Therefore a proposal such as yours provides a real opportunity to address any potential skill shortages in this area while continuing to strengthen and boost our important regional economies. In order to progress your proposal I am pleased to invite Doyle's (sic) Creek Mining Pty Ltd to apply for an exploration licence over the area outlined in the submission subject to the provision of a supplementary submission outlining in detail the industry and wider community support for such a proposal. Any consent that is finally given will be made under the Government's Guidelines for Allocation of Future Coal Exploration Areas (copy attached) and future mining development will be subject to financial contribution as per the table in the Guidelines. The New South Wales Government recognises the importance of the mining industry to our state both in generating employment and in being the single largest export income contributor." 1. While the invitation to apply for an exploration licence was expressed as being "subject to the provision of a supplementary submission", it was not in issue that this letter constituted a formal grant of consent to apply pursuant to s 13(4) of the Mining Act, the question having been specifically raised by me. Ultimately, in any event, what is important is that the act of providing the letter was understood by all to be the act relied on as misconduct as particularised in count 1 of the indictment. 11.8.2 The meeting of 14 August and other events preceding the letter 1. As noted above, the letter was drafted by Mr Macdonald's office rather than, as would ordinarily occur, by the Department. The Crown submits that Mr Macdonald deliberately excluded the Department from the process and that this is consistent with the decision being for an improper purpose. In order to understand this, it is necessary to consider the evidence leading to the writing of the letter. According to Mr Macdonald's diary, on 14 August 2008, a meeting was scheduled with Mr Coutts, Mr Mullard, Mr Sheldrake and Mr Gibson at 9:00am. [531] At 4:00pm, there was a meeting scheduled with Mr Maitland, Mr Gibson and Mr Munnings, and at 5:00pm, a telephone call "re mining" with Mr Gibson. It might be noted that 14 August was also the day of the Watermark announcement. Mr Gibson said all the meetings involved Mr Macdonald. He said that the 4:00pm meeting concerned Doyles Creek. [532] Mr Gibson said that Mr Macdonald's view at the meeting "was consistent with his view prior, that the Doyles Creek training mine should be a direct allocation" and that there was a discussion in relation to obtaining support for the proposal, with a general theme being the more third party endorsements that could be obtained, the better. [533] Mr Gibson said that about this time, Mr Macdonald indicated he "was looking to progress the proposal and the next step … would be to give Doyles Creek an invitation to apply for the exploration licence". He said he was told that the necessary documentation should be obtained from the Department as soon as possible and that Mr Macdonald would sign the invitation. [534] 2. An email from Mr Stevenson (the solicitor for DCM) to Messrs Maitland, Ransley and Poole the next day, 15 August, said that following his discussion with Mr Maitland that morning he assumed "the letter will be a formal application to apply". Based on this, Mr Maitland accepted that Mr Macdonald told him at the meeting that consent would be granted, but it was not clear that he had an actual recollection of this. Whether Mr Macdonald was present or not (Mr Macdonald said he was not), it is clear that Mr Maitland left the meeting with an understanding the consent would be granted. 3. Mr Gibson said that because the Department had not recommended a direct allocation, the Department did not have the necessary documentation ready which was "slowing things down a little bit". Mr Gibson said that Mr Macdonald said to him that "if the Department couldn't do it in the anticipated timeframe, that the Minister's office would do it". [535] The timeframe was "as soon as possible". [536] Mr Gibson said that he understood from Mr Munnings that there may be some resistance to getting the documents in a timely fashion, with the result that Mr Macdonald told him "if the Department won't do it, then do it". [537] Mr Macdonald said he did not recall using these precise words. [538] 4. Mr Gibson spoke to Mr Munnings or Mr Hawkes (both of whom were in the Minister's office) and asked for the documentation to be obtained. [539] Ms Madden recalled receiving a call from Mr Munnings at some point after the 27 May 2008 draft briefing note, and based on Mr Gibson's evidence, around 14 August. [540] Ms Madden was responsible for preparing the briefing note of 27 May 2008 and formulating the options in consultation with Mr Mullard. She said there had been no response to the draft briefing note. She said Mr Munnings asked whether there was any impediment to the Minister granting an exploration licence and that she, in turn, asked whether this was about Doyles Creek. When advised that it was, she said that there were issues that had been referred to in the briefing note and referred to the interest expressed by other companies and community concerns. She also said, in chief, that she referred to probity concerns. [541] However, her evidence was that during the course of the telephone call she brought the May 2008 briefing note up on her computer. There was no reference to probity issues in that document, and in cross-examination, she accepted she may have been mistaken about having raised probity as a concern in that conversation. [542] 5. Ms Madden said that having reiterated the concerns in the briefing note she was pressed by Mr Munnings who "kept saying, 'Yes, yes, yes, but can the Minister do it?'". [543] She said she told Mr Munnings that she understood the Minister could, under the Coal Allocation Guidelines, but that Mr Munnings "would need to speak to Brad [Mullard] about it as Brad was far better qualified and it was more appropriate that that answer would come from Brad's level". [544] Ms Madden also said that she told Mr Munnings that she believed "it would create problems" [545] and "it would come under the heading of that's a very courageous decision, Minister". [546] Ms Madden had no notes of the conversation and was giving evidence some years after the event. In cross-examination, she accepted that she told Mr Munnings that there were other companies interested in the area, that a direct allocation "will raise issues about what we've done" and that there were "also problems with the application in terms of the small training mine". [547] It was not suggested that the parts of the conversations referred to in her evidence-in-chief did not occur, with the exception of the reference to probity (although it should also be noted that neither accused was a party to the conversation and was not, therefore, in a position to challenge it directly). 6. Ms Madden said she immediately went into Mr Mullard's office to tell him about the conversation, and that he should expect a call from the Minister's office. She said they may have speculated about Mr Macdonald's likely action and believed he would grant consent to DCM. Mr Mullard gave evidence that he did not recall Ms Madden telling him that she had spoken to Mr Munnings about Doyles Creek, nor did he recall speaking to anyone from the Minister's office. 7. On 19 August 2008, Mr Hawkes received an email from Mr Agnew, the manager of Coal and Petroleum Titles and Systems, which he then forwarded to Mr Munnings. Attached was a template for ministerial consent. Mr Mullard said that Mr Agnew told him that he had received a request for the template, however, neither he nor Mr Agnew were aware of the purpose of the request. Mr Coutts said the sending of the template was not raised with him, although it should have been. Mr Coutts and Ms Madden said that the drafting of such a letter had never been done by anyone other than the Department. [548] The usual course was for the Department to draft the letter which would be provided with a briefing note recommending the letter be signed by the Minister. 8. On 21 August 2008, an email was sent to Mr Gibson from Mr Coutts' assistant, indicating that Mr Coutts had said "you might be looking for a copy of this … call me if it's not what he was referring to ...". [549] Attached to the email was a copy of a modified version of the draft briefing note of 27 May 2008. The reference to the "Coal Services Virtual mine training facility" in dot point 4 was omitted. Dot points 7 and 9 were removed. Below the recommendations, an additional sentence was added which read, "That the Deputy Director General signs the attached letter". The attached letter was addressed to Mr Maitland and indicated that the "Department has examined your proposal and believe it requires further examination and referral to the Minister for a decision". [550] Mr Coutts was taken to an email in which he said that Mr Gibson had discussed with him Mr Gibson drafting a letter to Mr Maitland around this time. [551] Mr Coutts said he did not take this to mean a letter giving the Minister's consent. He said this possibility did not cross his mind as the Minister's office had never drafted a letter of consent for an applicant for an exploration licence. [552] 9. Mr Gibson said that he, together with Mr Macdonald, drafted the consent of 21 August. Mr Gibson said that the preparation of the letter did not follow the usual course which was for the Department to prepare the letters, and noted that the Department had general counsel with expertise in drafting such documents. [553] 10. Mr Macdonald said that he did not believe that he attended the meeting on 14 August due to other commitments. [554] He said he had not, at that stage, reached a position in relation to the proposal, but did so in the next few days. He said he told Mr Munnings and Mr Gibson to inform Mr Maitland that he was considering the matter very closely, that the letters from the ACTU and Xstrata and other miners were very positive, and that he would be considering very shortly. [555] The following evidence was given: [556] "Q. Do you recall when you made your decision about what you wanted to do? A. It was very soon after that point of time and after I had spoken to the Premier and with the receipt of the support from the ACTU and some leading companies, I considered the brief again from that had been delivered to me in late May and I considered the options in that brief again and to look at and make sure that I thought the course of action I was taking was appropriate and I evaluated all of the conditions and the recommendations and felt that option one provided a course for a public benefit allocation, a public good allocation for a training mine in the Hunter Valley. Q. How did you communicate that decision? A. I spoke to Mr Gibson, I can't recall if Mr Munnings was present when I did that but I said to him that I wanted to progress the matter. I felt the public good component of the Doyles Creek proposal was very very strong indeed, that it would have benefits with the linkage to the university for a geology school, that that would be very useful in the Hunter in particular, and that the linkages with the Helicopter Rescue Service and the Hunter Valley Training Corporation would ensure that there was a strong training facility, you know, strong training institutional back up for the training mine, and on that basis I made a decision to ask Mr Gibson to progress the matter and to contact the Department and get the relevant paperwork. Q. When you asked Mr Gibson to get the relevant paperwork, did you provide him with any further instructions at that point in time? A. No, not really, no. Q. Did Mr Gibson come back to you or did some other person come back to you at some stage with any documentation? A. I'm not sure whether it was Mr Gibson or Mr Munnings, came into my office on the 21st and presented me with a letter which was an invite letter to Doyles Creek Mining and I had a look at that. I think I came back to it a bit later and said "I would like to make a change" and so I made a change in terms of more industry and, if I remember rightly, more indications of support." 1. Mr Macdonald confirmed that he had a copy of the draft briefing note when drafting the letter, it having been emailed to Mr Gibson on 21 August 2008 (although, as noted, it was not quite the same). Also attached to that email was a draft of a short letter to Mr Maitland indicating the Department believed it required "further examination and referral to the Minister for a decision". [557] 2. Mr Macdonald said that he had no knowledge that the Department was unaware the letter was being prepared. [558] He also believed that the letter, once written, would be entered into the Department's document management system and a hard copy would possibly be sent to the Department. He disagreed with the evidence of the Department's officers that a letter granting consent to apply had not previously been written by the Minister's office and referred to an instance in 1992 (some 16 years prior). 3. Mr Gibson also gave evidence that around the time of the preparation and signing of the letter of 21 August 2008 granting consent, there were discussions about a possible cabinet reshuffle. His evidence was that Mr Macdonald said, "I may get or end up with the Planning portfolio". [559] Mr Macdonald agreed there was speculation surrounding a cabinet reshuffle at the time, as indicated by Mr Gibson. However, when Mr Macdonald was asked whether he had thought there was a possibility that he might end up with the Planning portfolio, he said, "I didn't really think". [560] His evidence was he did not discover the possibility of a cabinet change until 2 September when Mr Iemma told him of an impending resignation and that he felt he was "finished" as Premier. [561] Reconciling this with Mr Macdonald's acceptance that there was speculation around the time he signed the letter of 21 August, I understand the conversation with Mr Iemma to mark a change from speculation to an identified prospect. Mr Macdonald denied that a possible cabinet reshuffle was the reason he wanted to get this letter out while he could. Despite the denial, his haste in granting the consent to apply is, at the least, consistent with Mr Macdonald's anticipation of a cabinet reshuffle. Of course, that is not necessarily inconsistent with the genuine belief that the decision was a proper one, with respect to which he had particular knowledge. 11.8.3 The terms of the letter 1. There are some noteworthy aspects to the letter. In it, Mr Macdonald stated that he is "advised that the NSW Minerals Council is currently considering the proposal and I expect their advice shortly". Mr Macdonald said that while he could have waited for their advice he did not regard it as "critical" to his decision. [562] However, contrary to this, Mr Macdonald had acknowledged the importance of the view of the NSW Minerals Council with respect to the proposal elsewhere in his evidence (and implicitly in the letter of 21 August 2008). As discussed above, he had, at least on Dr Williams' view of the contact, "lobbied" Dr Williams. It is somewhat remarkable that the letter proceeds to grant consent, despite acknowledging that the advice of the Council was expected shortly. 2. Further, the consent was granted "subject to the provision of a supplementary submission outlining in detail the industry and wider community support" for the proposal. It is unclear why consent would be granted, particularly contrary to the Department's advice, when it was considered necessary that the proponent provide further information. It is to be recalled that the critical decision in the process is the grant of consent to apply. As noted above, once that consent is granted the grant of the exploration licence was generally a "box ticking exercise". 3. The letter makes no reference to the consent being granted on condition of the establishment of a training mine. I accept, however, that this is implicit in the acceptance of what had been proposed. Indeed, reading the letter alone would tend to suggest that the proposal was for a training mine only. 11.8.4 Conclusions to be drawn from the drafting of the letter 1. If I were to regard it as reasonably possible that Mr Macdonald's evidence as to his purpose in writing the letter is true, it follows that I would not be satisfied he granted the consent for an improper purpose and he must be found not guilty. That is a question to be resolved on a consideration of all the admissible evidence on the issue and to which I will return. For present purposes I am concerned with an evaluation of the significance of the circumstances surrounding the drafting of the letter and what it says about Mr Macdonald's asserted purpose. 2. It is clear that there was a difference of opinion between the Department and the Minister's office with respect to the DCM proposal. Further, the position of each was known to the other. The circumstances in which the modified version of the 27 May 2008 briefing note and accompanying draft letter was sent to the Minister's office are unclear. There was no evidence as to why the changes were made to the draft initially sent. It is uncertain as to what prompted Mr Coutts to send the modified briefing note. Mr Coutts did say that, from time to time, he had asked Mr Gibson whether there had been any progress on the matter, and that, in this context, he may have asked for the papers. 3. I am inclined to accept the evidence of Mr Coutts and Mr Mullard that they had no awareness that the letter of consent was being drafted in the Minister's office. While Mr Coutts was aware that the Minister's office was writing to Mr Maitland, it is understandable that he did not connect this with a letter of consent, given that he had no expectation that the Minister's office would take such action. Further, he had provided a draft letter effectively putting off Mr Maitland by saying the matter was still being considered. 4. It does not follow, from the above, that Mr Macdonald wished to keep from the Department his intention to grant the consent. It is clear that Mr Gibson told Mr Coutts that Mr Macdonald intended to write to Mr Maitland. It was no secret that Mr Macdonald was in favour of the proposal. Further, Mr Macdonald must have been aware that the Department would inevitably learn that consent had been granted. 5. The drafting of a letter within the Minister's office is more understandable on the basis of a desire for haste. Mr Gibson's evidence suggested that waiting for the Department, given the different views, was likely to slow things down. Further, the observations in the letter itself suggest it would have been logical to delay the granting of the consent until the advice of the NSW Minerals Council and the further submission with respect to industry and community support were received. As to why there should be such haste, I note the application had been on foot for some time. However, there was nothing happening that was relevant to a proper determination of the application that required the urgency that appears to have been applied. The likely explanation for Mr Macdonald's urgency appears to be the prospect that he might be moved on from his portfolio. The timing of the letter also suggests that Mr Macdonald was not sufficiently concerned as to the view of the NSW Minerals Council that he was prepared to wait a relatively short time for its advice. 6. A view that someone else may not make the same decision does not make a decision improper. Nonetheless, the evidence supports a strong desire to grant consent, despite there being further matters for the proponent to address and irrespective of the views of the Department. 11.9 Events immediately following the grant of consent to apply on 21 August 2008 1. On 2 September 2008, a journalist from the Newcastle Herald contacted the Department and advised that he had met with Mr Maitland who informed him that Mr Macdonald had invited DCM to apply for an exploration licence and sought confirmation that this had occurred. The Department at that time had no knowledge that the consent to apply had been granted. 2. On 11 September 2008, there was a meeting of the NSW Minerals Council. The approach of the Council has been discussed above. For present purposes it is sufficient to note that the Minerals Council declined to support the proposal. 3. Other events around this time largely relate to Mr Maitland gathering support for inclusion in the subsequent application and were admitted only against Mr Maitland. These are dealt with in the context of the case against him. 12. The case in detail: Part 6 – The application for and granting of the exploration licence and the events following 12.1 The application 1. On 29 September 2008, by letter addressed to the Mining Registrar (Coal) of the Department from Mr Maitland as chair of DCM, DCM made an application for an exploration licence. [563] The application consisted of the completed form as required under the Mining Act and a cheque for the required fee (of $22,800). Attached to the form was, as required, a map setting out the proposed area, evidence of financial capacity in the form of a letter from Paradigm Capital indicating its support for DCM's proposed equity raising together with the steps taken in that regard, and a document setting out the proposed program of work. The letter also enclosed the submission of 18 March 2008 and Mr Macdonald's letter of consent of 21 August 2008. 2. The letter then stated, "in addition, as requested by the Minister we enclose letters of support from the following" before listing various letters. The letter concluded by saying "we understand there is also overwhelming community support from the Jerrys Plains community demonstrated by previous communications from the community to the Minister". [564] This letter, presumably, constituted the "supplementary submission outlining in detail the industry and wider community support" for the proposal required by the consent of 21 August 2008. 3. The support letters enclosed included the letters listed at [383]. [565] While the letter from the WRHS was in different terms to the letter sent prior to the grant of consent, and stressed the engagement in community briefings and that a commitment "to excellence" was communicated to the community, it added little to the earlier letter. Similarly, while the letter from the HVTC is in different terms, it merely indicates a view that the DCM proposal would "help to ensure that the needs of our region for skilled workers can be continued to be met" but does little to explain how this would be done. The letter from Xstrata appears to be identical to the earlier letter. The letters from Donaldson Coal, Felix Resources, Peter Murray, Hydromining and Sharan Burrows appear to be simply copies of letters previously provided. 4. In addition to the above, letters were provided by Ian Murray, President of the CFMEU Northern District Branch of the United Mineworkers' Federation of Australia, Merv Mahon of the Retired Mineworkers Association, Geoffrey Pike of Sparke Helmore, Greg Combet, Federal Member for Charlton, Kerry Hickey, State Member for Cessnock, Robert Coombs, State Member for Swansea, Stuart Barnett of Slater & Gordon, Nicholas Saunders for the University of Newcastle, Ray Barker of Skills DMC and Gary Kennedy of Newcastle Trades Hall Council. 5. It will be recalled that Mr Peter Murray (CFMEU Mining and Energy), Mr Marsh and Mr Jones (WRHS), Mr Morris (HVTC) and Professor Carter (University of Newcastle) had submitted letters in 2007, in relation to the skills shortage which did not refer to the training mine proposal. Significantly, there was no evidence of support from any coal mining companies additional to those that had indicated support prior to the granting of the consent to apply, despite the terms of that consent being subject to a supplementary submission "outlining in detail the industry and wider community support" for the proposal. The only possible exception is United Collieries, the support of which was indicated in Mr Peter Murray's letter in 2008. It is questionable whether this was additional support given Mr Peter Murray had already provided a letter in 2007, albeit on behalf of CFMEU Mining and Energy. 6. A letter from Mr Paul Nichols, President of the Jerrys Plains Mine Watch Committee, was sent to Mr Macdonald's office on 7 October 2008. [566] The drafting of this letter is not relevant to Mr Macdonald's case and is discussed below in the context of Mr Maitland. For present purposes it is sufficient to note that the letter stated that the Committee had "agreed to negotiate a binding Memoriam of Understanding with Doyles Creek Mining Pty Ltd on the terms set out in our letter by Dave Thelander Secretary of Jerrys Plains Mine Watch to Mr Craig Munnings Department Liaison Officer for the Department of Primary Industries." It then said: "When this agreement is finalised by Doyles Creek Mining Pty Ltd and these guaranties are accepted , the Jerrys Plains Community will be in a position to consider our support for the establishment of the Training Facility and Mine at suitable venues in our area." 1. The status and representativeness of the Committee and the terms of the letter from Mr Thelander to Mr Munnings are not known. Nonetheless, the letter falls somewhat short of an indication of community support. 2. Mr Macdonald said he did not recall how the application came to him, but it was not his job to make an initial assessment of it, but rather the job of the Department. He said that he could not recall when this particular application came through to him "but generally speaking I would not see much about this, or any other exploration licence, until it comes through to me in terms of having to sign, if that was appropriate, the final approval for the actual granting of the licence". [567] 12.2 Drafting conditions 1. Mr Mullard gave evidence that he was involved in drafting the special conditions on the exploration licence. To this end, he was involved in discussions with Mr Gibson and consensus was ultimately reached. Those special conditions (conditions 49-58) included a requirement that DCM commence substantial development of a training mine within three years (condition 57(b)). The conditions also required DCM to develop a training program for its proposed activities within one year (condition 52), a community consultative committee within six months (condition 53) and annual funding of $250,000 per annum to the New South Wales Institute for Carbon Sequestration at the University of Newcastle (condition 56(b)). DCM was required to report annually to substantiate that all commitments were being met (condition 54). The conditions made clear that a failure to comply with the conditions would allow the Minister to cancel the licence. 2. Mr Macdonald, in his evidence, said he was satisfied that the conditions addressed the relevant issues, and that, in the event that the conditions were not met, he had the power to intervene. Mr Macdonald was cross-examined with respect to the absence of anything in the special conditions relating to the University of Newcastle beyond the annual payment. Similarly, it was pointed out in cross-examination that there were no special conditions concerning the HVTC or the WRHS. There was, however, the clause in relation to the establishment of the training mine. To the extent that these matters were not addressed it was arguably a matter of drafting and to be considered in the context of DCM having established the various relationships. It appears that steps were subsequently taken to finalise an agreement between the Department and the University with respect to what became the New South Wales Institute of Frontiers Geoscience, consequent on the annual funding to the University required of DCM, and agreements were reached with WRHS and HVTC. [568] 12.3 Nippon Club meeting on 25 November 2008 1. A meeting took place on 25 November 2008 at the Nippon Club. In attendance were Mr Macdonald, Mr Maitland, Mr Ransley, Mr Gibson, Jason Barton, the senior media adviser in the Minister's office and Fiona Cameron, a senior policy advisor in the Minister's office. The Nippon Club was essentially across the road from Parliament House, and was selected as it allowed Mr Macdonald to "duck across" during the break between the afternoon and evening sittings. [569] Mr Gibson said that Mr Macdonald told Mr Maitland and Mr Ransley that they had made a strong case, that there was a significant public good component, and that the exploration licence would be granted in the near future. Mr Macdonald gave similar evidence. He, however, said that any approval was subject to the drafting of appropriate conditions. 2. The following day, Mr Gibson emailed Mr Maitland thanking him for dinner and indicating that 15 December was locked in for dinner. [570] He also asked Mr Maitland to "let me know how you go with Shougang" [571] and reiterated an offer to provide "them" with a tour. Mr Macdonald said this was a reference to representatives of a Chinese company that Mr Maitland had mentioned was visiting Sydney and that it "would be good to meet up with them given their size, influence and scope in the Chinese economy", [572] although he did not understand them to be involved in Doyles Creek. He said the 15th was arranged on the basis that Shougang representatives would be present at the signing. [573] 3. Also on 26 November, Mr Maitland emailed his longtime friend Mr Tudehope and told him that he had had a dinner meeting with "the Minister for Mines" who told him he would have the letter of approval for the exploration licence on 5 December. [574] He also said that Mr Macdonald agreed to host a dinner at Parliament house for "Mr Li and Edwin" at Parliament House on 15 December 2008. Mr Maitland confirmed in his evidence, by reference to this email, that he was told by Mr Macdonald at the meeting at the Nippon Club that the exploration licence would be granted. [575] 4. On 5 December, Ms Madden sent the Minister's office a briefing note together with the relevant documentation, including a draft letter to Mr Maitland enclosing the unsigned deed between the Minister and DCM and the unsigned exploration licence, which was in turn sent to Mr Maitland that day. [576] 5. On 12 December, the Department sent Mr Macdonald a briefing note recommending Mr Macdonald grant the exploration licence. [577] That day, notice was given in the Government Gazette of the receipt of the exploration licence application. [578] On the morning of 15 December, Mr Maitland contacted Mr Gibson to ensure that Mr Gibson had the deed and whatever else needed to be signed. [579] 12.4 Catalina Restaurant: the signing of the exploration licence on 15 December 2008 1. Mr Gibson said that Mr Macdonald nominated dinner at Catalina Restaurant in Rose Bay for the event. Mr Gibson said that in the ordinary course, an exploration licence would be signed in the Minister's office, or some Government setting. He had not known an exploration licence to be signed in such a setting before. [580] Dr Sheldrake accepted that he had attended signing ceremonies with Mr Macdonald and that there had been a lunch following a signing ceremony with the Guandong Department of Agriculture. [581] Mr Macdonald said that he had undertaken to host a dinner for representatives from Shougang at Parliament House and it was discussed that, if the exploration licence was ready for signing, the events could be linked. [582] He said that it was very late in the piece that he became aware that representatives of Shougang were not attending. [583] It was not clear why Catalina Restaurant was chosen over Parliament House if the expectation was that representatives of Shougang were attending (or at all). 2. In attendance at Catalina Restaurant were Mr Macdonald, Mr Ransley, Mr Gibson, Mr Bartlett and Mr Macdonald's daughter, Sasha Macdonald. The exploration licence was signed. [584] Mr Bartlett said he was asked to attend this dinner as company for Mr Gibson, but agreed it may also have been in the expectation of the presence of Chinese dignitaries, it being part of his role to deal with Asian dignitaries. Mr Macdonald said that Mr Bartlett was there as he was a media person. 3. Mr Macdonald said he introduced his daughter, Sacha, to the other attendees at the restaurant. He did not explain why she accompanied him to the event, although I am prepared to accept he anticipated that it may be relevant to her given her interest in China, which was apparent in the evidence of Mr Tudehope and Mr Maitland. 4. Mr Maitland accepted that the company was quite satisfied with the progress it had made and that he was quite happy at the signing because the exploration licence would be worth millions of dollars if DCM found coal. [585] He accepted that it was signed in a friendly environment. [586] In respect of Mr Macdonald's daughter, he said he put her in contact with Mr Tudehope as she wanted to work in China and this was the sort of thing he would do for anyone as a trade union leader with a lot of contacts. [587] 5. With respect to the decision to sign the exploration licence it is convenient to return to the briefing notes of 5 December and 12 December 2008. 6. The briefing note of 5 December was as follows: [588] "Issue: The Minister make an offer of an exploration licence to Doyles Creek Mining Pty Limited. Background: On 18 March 2008, Doyles Creek Mining Pty Limited (DCM) requested the Minister's consent to apply for an exploration licence for coal over an area of approximately 30 square kilometres adjacent to the township of Jerrys Plains. The request relates to the proposed Doyles Creek training mine. The whole of the state of NSW is a mineral allocation area for coal and applications for exploration licences require Ministerial consent. In a letter dated 21 August 2008, the Minister invited DCM to apply for an exploration licence over the area outlined in a submission they had provided, subject to the provision of a supplementary submission. Special conditions have been included in the exploration licence to cover particular aspects pertaining to the training mine and area. Comment: The consent is subject to future financial contributions under the Government's Guidelines for Allocation of Future Coal Exploration Areas. Recommendations: The Minister sign the attached letter and forward it to the applicant, in accordance with the previous consent given to apply for an exploration licence." 1. The briefing note of 12 December was as follows: [589] "Issue: Grant of an Exploration Licence (EL) in satisfaction of Exploration Licence Application 3628 lodged by Doyles Creek Mining Pty Limited. Background: Exploration Licence Application (ELA) 3628 was lodged by Doyles Creek Mining Pty Limited on 1 October 2008. The EL granted in satisfaction of ELA 3628 is to be used to train mine personnel and will be known as the Doyles Creek Training Mine. Representatives from Doyles Creek Mining Pty Limited are scheduled to meet with Minister Macdonald on Monday 15 December 2008 and will be returning the signed documentation offering an Exploration Licence at that meeting. The $30,000 security deposit will be lodged with the Department prior to the meeting with Minister Macdonald on 15 December 2008. The Part 5 Determination was submitted to the Minister's office on 12 December 2008 and must be signed prior to the licence document being executed to ensure compliance with the Mining Act 1992. The ELA is yet to be advertised. The section of the Mining Act 1992 referred to in this briefing is attached as additional information 1. Recommendations: In accordance with the provisions of Section 22(1) (a) of the Mining Act 1992, the Minister grant an exploration licence in satisfaction of this application, subject to the terms and conditions specified in the licence document. The licence document be signed and returned to the Maitland Minerals Titles office for completion." 1. Dr Sheldrake gave evidence that he had signed off on the briefing note of 12 December. It was suggested to Dr Sheldrake that around the time of the 5 December briefing note, which recommended the Minister offer an exploration licence and the draft deed, no one had raised any issue with him. Dr Sheldrake said he "had been advised that the Minister had determined that the Doyles Creek proposal was to go ahead" and, resultingly, the correspondence was prepared as the Department was working to that end. [590] 2. It will be recalled that Mr Macdonald said that he did not remember when the application for the exploration licence came to him, it being the job of the Department to make the initial assessment. There is no reason to doubt this evidence. It is consistent with what has been previously said about the relative significance of the grant of consent to apply and the grant of the exploration licence. But it does highlight a serious defect in the present process. That is, it suggests that the grant of the consent to apply was, at least, premature in circumstances where the proponent was yet to sufficiently demonstrate industry and community support. 3. In cross-examination, Mr Macdonald was taken to the briefing note of 12 December and the following exchange took place: [591] "Q. And you recall Mr Sheldrake giving evidence about this, that at this time he knew that you made the decision to grant it, do you remember that? A. Yes, he said that, yes. Q. And that is true, isn't it, that you decided, before this date, to grant it, and that is what you are doing here? A. Subject to this document. Q. When you say subject to this document, are you saying that you would not have signed it if the Department had not consented to it? A. That was my view at the time, yes. Q. And all the Department was doing was providing the documentation implementing the decision you had already made, isn't that right? A. I don't believe in that sense. I had made an invitation to the proponents to put a document in, and subject to all the conditions being met and the Department recommending, I would then sign. But at every point this document, in the end, was the key point. I was not going to sign a grant over without the Department putting this document in front of me. Q. They prepared the document based on a decision you had already made, isn't that right? A. Well, I had made a decision to issue an invitation. That was the decision I made. Q. You also made a decision, in advance of signing the exploration licence, to grant the exploration licence, isn't that right? A. Provided there was this recommendation in front of me and subject to strict conditions to ensure that there would be a training mine. … Q. In the week before this, Mr Macdonald, you had met with Mr Maitland and Mr Ransley and you had said that they would have a letter in their hands by 5 December, do you remember that? A. Subject to the appropriate documentation and the conditions being agreed by everyone. Q. And 15 December had been locked in as a date when this exploration licence would be signed, isn't that right? A. Provided - provided - that this recommend, a recommendation from the Department, to do it, was there. Q. You knew the Department was implementing your decision when they wrote the word "recommendation" on that page, isn't that right? A. My decision on 21 August was an invitation. Q. I withdraw that. To be clear, Mr Macdonald, you knew that the word "recommendation" on this document, at 805, reflected the Department implementing [your] decision to grant the exploration licence, isn't that right? A. I can't say that." 1. This evidence tends to minimise the significance of the invitation given to DCM to apply for an exploration licence, by suggesting that it was then up to the Department to evaluate the proposal and that Mr Macdonald would not sign off without the Department's recommendation. Firstly, it should be observed that the consent to apply was issued contrary to the Department's recommendation. Mr Macdonald had the power to do so but it rather undermines his assertion that he was thereafter simply following recommendations. Secondly, the recommendation to sign the exploration licence must be seen in the context in which it occurred. As has been previously noted, it was generally regarded as an administrative exercise. In the present case, having regard to the special conditions, those descriptions perhaps understate the process. But even so, there was no reason to think that conditions could not be drafted to ensure that a satisfactory training mine was established and maintained (together with the other commitments made by DCM). For present purposes, it is enough to consider the context provided by the briefing notes of 5 and 12 December. Those briefing notes suggest an absence of critical evaluation, consistent with the Department simply working to implement Mr Macdonald's earlier decision. 2. Mr Macdonald sought to minimise the nature of the consent to apply for an exploration licence, and to inflate the significance of the exploration licence. I find this to be consistent with the granting of the consent prematurely, in that the merits of the proposal had not yet been properly assessed. Placing conditions on the consent in relation to industry and community support allowed for an assumption that additional scrutiny would be given to the proposal beyond that which was likely. The reality was that the primary concern from the time the consent was granted was as to how the proposal would be implemented in a way that bound DCM to its promises. There was never any real question that the exploration would be granted. 12.5 The Doyles Creek media release 1. A media release announcing a "New Training Mine for Hunter an 'Australian first'" was issued on 23 December 2008. [592] Notice of the grant was also published in the Government Gazette on 16 January 2009. [593] As the Crown submitted the timing of the press release was probative of guilt, it is necessary to consider this in more detail. The media release was attached to an email sent from Ms Hilder (then Ms Derrig) to media advisors in the Premier's office indicating that the plan was to give the release to the Financial Review before "sending it out generally to Hunter media tomorrow". [594] The media release itself indicated it was embargoed until 5:00am on 24 December. The provision of it to the Financial Review on 23 December presumably had the result that it would not appear in print until 24 December. The circumstances leading to the media release occurring on Christmas Eve require further consideration. 2. It might first be noticed that there was no media release at the time that the consent to apply for the exploration licence was granted. This can be contrasted with what occurred with respect to, at least, Caroona and Watermark. Arguably, however, a different situation pertained. The announcements with respect to Caroona and Watermark were in the context of the determination of an open tender process. In other words, it was commenced as a public process, and it was natural that its resolution would also be the subject of public announcement. Further, the grant of consent to DCM was conditional on a further submission such that it may have been seen as premature for a public announcement. While this, to an extent, again highlights the problematic nature of the conditional grant of consent to apply, I would not draw any adverse inference from the absence of any media release at the time of the grant of consent to apply. 3. Returning to the media release in December, prior to Ms Hilder's involvement, responsibility within Mr Macdonald's office for the release was with Mr Bartlett. He said that, as the senior media adviser in Mr Macdonald's office, he met with Mr Gibson and Mr Macdonald at some point around then in relation to a media release relating to "a training mine". It was agreed that the Newcastle Herald, as a newspaper local to the mine, and the Financial Review, due to its focus on business and mining, would be likely to give a "good run to the story" and it would be provided to them before it was released more generally. [595] Mr Bartlett prepared a draft media release in conjunction with Mr Gibson and Mr Barnes, a representative from DCM (as to which he observed it was normal for a stakeholder to have input into this process). On 19 December, he emailed the draft to Mr Barnes copying Mr Gibson and Ms Hilder as he was about to go on holidays. [596] Ms Hilder and Mr Barnes settled the draft. 4. Mr Bartlett was taken to a spreadsheet which contained a "story list" for the Minister with corresponding dates which, Mr Bartlett said, suggested the planned issue date for the media release was 22 December 2008. [597] Ms Hilder said she understood the media release was to go to the Newcastle Herald and the Financial Review on 22 December for publication on 23 December and general release that day. That did not occur as a result of a matter that arose over that weekend that the media section was dealing with. [598] Ms Hilder spoke to Mr Macdonald, which resulted in her sending an email stating that she had spoken to Mr Macdonald on 22 December and "he said we need to do it next week". Mr Bartlett responded, almost immediately, "I thought they wanted it out when it wouldn't run? Try not to let them bank up 20 releases for next week when [Mr Gibson] won't be here to ask questions". He said that he did not want stories backing up because they were handling a number of portfolios and there were a large number of stories with the result that they had to get them out. Ms Hilder indicated she would go back to Mr Macdonald and "suggest it will be better to get rid of it before he is acting Health Minister". [599] As indicated above the release went out on 23 December, embargoed until 24 December. 5. With respect to Mr Bartlett's statement that "they wanted it out when it wouldn't run", he confirmed he was on leave at the time and had not spoken directly to Mr Macdonald or Mr Gibson in the previous three or four days from the time he sent his email on 22 December. [600] He did not recall anyone telling him that they wanted the story out when it would not run. Ms Hilder said that Mr Macdonald had not said this to her. [601] She did say that as a "mine story" it was not as positive as other stories in the portfolio "so the understanding was to issue the media release … during the quieter period over Christmas". [602] Mr Bartlett's opinion that "they" wanted the story released when it wouldn't run, insofar as it is evidence of his state of mind, is not relevant. Insofar as it was his opinion of the state of mind of others, it is without foundation and I give it no weight. 6. As noted above, on 23 December, Ms Hilder sent a copy of the proposed release to media advisors in the Premier's office. This resulted in an email from Mr Gibson to Mr Hawkes in which she said "upstairs have seen [the media release] and are having a bit of a panic" and sought "a page or 2 of dot points". [603] The Crown relied on this to assert that the "panic" related to a concern that the announcement of the grant of an exploration licence by Labor government to a company connected with Mr Maitland would come under scrutiny. There was no reference in the media release to, and no evidence that anyone in the Premier's office was aware of, the fact that DCM was connected with Mr Maitland. Quite apart from any issue with respect to relying on the state of mind of unnamed persons in the Premier's office to infer that Mr Macdonald would have been aware of the sensitivities (or "probity issues") in making a decision that favoured Mr Maitland, there is nothing to suggest this was the basis of the concerns. It is equally likely that there was a concern that the Premier would be asked about the detail of the proposal. The dot points provided addressed that detail. Nothing was provided to the Premier's office which attempted to justify granting the licence to a company associated with Mr Maitland. I do not regard the evidence that the Premier's office or some part of it was having a "bit of a panic" as probative of any issue in the trial. 7. While presumably, had Mr Macdonald been minded to do so, he could have insisted that a media release be issued at the time the consent was granted or when the exploration licence was signed, or both. With respect to the former, as I have observed above, it would have been, at least arguably, premature, given the conditions put on the grant of consent. With respect to the latter there is no evidence that Mr Macdonald was involved in delaying the release from that time until it was ready for release on 23 December. Ultimately, it appears there had been a plan to release the story for publication on 23 December, a subsequent plan to do it the following week, and ultimately a revised plan to do it on 24 December. The timing of the media release does arouse suspicion. Not taking a step that would ordinarily be taken, such as putting out a media release, could be seen as circumstantial evidence from which an inference of guilt could be drawn. Arguably, while not identified by the parties, the evidence might go further to be regarded as post-offence conduct revealing a consciousness of guilt on the part of Mr Macdonald. The care to be taken with evidence of this nature is well established. [604] I am, however, mindful of the tendency for the close examination of one particular event to shroud the reality of the many matters likely to have required attention in the context of Mr Macdonald's responsibilities at the time. In either event, I am of the view that there is a danger in relying on this evidence in tending to prove guilt, and I put it to one side. 12.6 Post allegation events 12.6.1 An alleged lie to Mr Rees 1. As noted above, in September 2008, Mr Rees became Premier and remained in that position until December 2009. In evidence given in 2017, Mr Rees said that he recalled a conversation with Mr Macdonald in relation to a training mine in the days prior to Christmas 2008. He said the conversation took place "from memory" outside his office in Governor Macquarie Tower. The following evidence was then given: [605] "Q. To the best of your recollection can you tell us the words that were spoken by Mr Macdonald to you? A. To the effect that we have a significant announcement around a training mine that is supported by the relevant union, Newcastle University, the coal and related industry businesses up there. Q. Did Mr Macdonald say anything about the purpose of the proposal? A. That it was a training mine. Q. Was there any mention about commercial aspects? A. To the best of my recollection there was a discussion around that and it was indicated to me that there was negligible commercial value in the mine. Q. You said that Mr Macdonald had said something about the union. Was anyone else mentioned in that regard? As I think he said union - sorry, what did you say he said about the union? A. That the training mine proposal was supported by the relevant union. Q. Yes. A. And also industry and academics at the University of Newcastle. Q. Did you respond to that? A. I said something to the effect of: "Well, if - that sounds reasonable. It's a training mine, no commercial value of the coal, all the players support this. But there hasn't been a tender process. You'll need to be prepared to stand up and outline why this stacks up without a tender process."" 1. In cross-examination, Mr Rees was asked if he could be mistaken as to whether Mr Macdonald had said there was negligible commercial value in the mine and responded that that "was the clear impression I had". [606] 2. Mr Rees was recalled before me and confirmed that he had read his earlier evidence and was satisfied it was the truth. With respect to the conversation in relation to the training mine, Mr Rees confirmed that he used the words "to the effect" and "to the best of my recollection" because he could not recall the exact words used. [607] Mr Rees was taken to the transcript of evidence that he had given at what was described as a "public hearing" in March 2013. He agreed that when asked if he remembered when he first became aware of the Doyles Creek allocation he responded, "not precisely, no". [608] He also agreed he was asked in 2013 about the circumstances in which he became aware of the training mine, and he had said he could not recall precisely how "it was put to me or when it was put to me". Mr Rees accepted that, in 2013, when asked as to his recollection of subsequent interactions with Mr Macdonald on the topic he answered as follows: [609] "On the topic, um, again it's, it's difficult to disaggregate the material that's been in the public domain since, but myself and/or my office were aware that it was intended that, ah, this training and safety mine licence be made without a tender process, um. It was relayed to the Minister or his office that, listen, you'll come under scrutiny and you will need to answer why this is the case. My impression at the time, my understanding at the time or my office as it relayed to me was that it was a training and safety mine, a training and safety mine that had limited geological significance and was of a niche value in the, in the scheme of training" 1. In the above answer, Mr Rees made it clear that he had received information from a variety of sources. It is not inconsistent with his evidence in 2017 and 2022 that one of those sources was a direct conversation with Mr Macdonald. 2. Mr Rees was also taken to the record of interview conducted with "investigators" dated 11 April 2012. He was asked in that interview about his recollection as to whether Doyles Creek was ever brought to Cabinet and responded: [610] "… there has been so much media coverage of this since the period. I can't recall precisely at what point or in what form it first bubbled to the surface nor at what point were concerns first raised nor the nature of those concerns." 1. At a later point in the interview the following exchange occurred: [611] "Q. Do you recall ever having a conversation with Mr Macdonald about [Doyles Creek] at all? A. No, I don't but that's not to say I didn't and I mean in media commentary subsequently and there has been quite a bit of it. It's - it's very difficult for me to disaggregate the sequence of it, the provision and who provided it. So I don't recall having a discussion. It may have come to Cabinet, but like I said GFC receives hundreds of Cabinet minutes." 1. Mr Macdonald in his evidence denied telling Mr Rees that there was "negligible commercial value in the mine". He said that he was in Victoria just prior to Christmas, that there was no cabinet meeting that week, and doubted that he had a personal conversation with him at all. He said he had a telephone conversation with Mr Rees on the Sunday (21 December) in relation to a different issue, that issue being the one leading to the postponement of the Doyles Creek media release. [612] 2. As noted above, the Crown relies upon the alleged statement by Mr Macdonald to Mr Rees as a lie told out of a consciousness of guilt. As noted above, care is required in this area. Before considering the various concerns, the first matter of which I must be satisfied is that Mr Macdonald made the statement alleged. If so satisfied, I must be satisfied that it was a deliberate lie, in that he knew, at the time, it was untrue. 3. While the questions and answers in the interview with investigators and in the public hearing were put to Mr Rees, he maintained that he had a clear recollection of the conversation. He tied it, in particular, to its occurrence immediately prior to him travelling overseas in relation to a significant personal event. He noted, and I accept, that it does not follow that because the evidence given in these proceedings was more remote in time than the evidence given in the interview with investigators or in the public hearing, it was less reliable. As he observed it may be that he has had more time to reflect. 4. I do not doubt the honesty of Mr Rees, either in his evidence before me, or when responding to the investigators in 2012 or at the public hearing in 2013. An honest recollection is, of course, not necessarily a reliable recollection. In relation to this matter, the alleged lie told by Mr Macdonald, I have only the evidence of Mr Rees. Mr Macdonald denied it. Mr Rees was doing his best to recollect in circumstances where it was not suggested he had anything that might assist such as contemporaneous notes. To the contrary, he was impaired as a result of the level of "noise" that resulted from the many references and discussions in relation to the issue subsequent to his first becoming aware of it. Additionally, there was a significant risk to Mr Macdonald in advising Mr Rees that the mine had "negligible commercial value", in that the lie was likely to be exposed. I am not sufficiently satisfied that Mr Macdonald said the words attributed to him such that I could rely upon the evidence as evidence of a consciousness of guilt on his part. 12.6.2 Correspondence from the Department in relation to the decision 1. Evidence was given of correspondence sent by the Director-General of the Department, Dr Sheldrake on 30 January 2009, to a member of the community in response to an enquiry with respect to the issue of the exploration licence to DCM. [613] Also tendered was an email drafted by Mr Mullard providing an explanation for the grant in connection with responding to the letter. [614] I do not regard explanations for the relevant decisions in letters from the Department or internal emails as of assistance. It is plain that the role of the Department was to support a decision of the Minister once made. 12.6.3 Correspondence with Alan Jones 1. On 3 February 2009, Mr Macdonald wrote to the broadcaster Alan Jones, in response to a letter from Mr Jones in relation to the grant of the exploration licence to DCM. [615] The response was approximately four pages in length. It was largely drafted within the Department. Mr Jones' letter was not in evidence, and indeed Mr Macdonald said he was unaware of its precise terms. 2. In an email from Mr Bartlett to Ms Hilder, Mr Bartlett said: [616] "For the Alan Jones letter - he wants a line on John Maitland such as "Alan, I notice you mentioned John Maitland in your letter. I have met John several times in a professional capacity over the last few years and I can assure you he is an industry leader and expert in his field. That said, his involvement is a minor factor. The key element is the strength of this proposal that was developed over many years with the Department of Mineral Resources - a proposal that has gained considerable support from industry and educational sectors alike. "There is a real need for this training mine in NSW - Alan, as you know, mining is not something that can be gleaned from a book sitting at a desk, it can only be learnt at the coalface so to speak."" 1. Mr Macdonald, in his evidence, said that he did not believe he expressly drafted the passage himself. By this, I take it he meant that he was not responsible for the precise content. He accepted the statement that the proposal "was developed over many years with the Department of Mineral Resources" was not correct. [617] He said other aspects of the email were correct. 2. While there is a clear inaccuracy in Mr Bartlett's email, which in turn found its way into the letter to Mr Jones, that inaccuracy does not further the Crown case. It is more instructive to consider the letter as a whole. Generally, the letter sent to Mr Jones emphasises the training aspect of any proposed mine. Indeed, what is referred to is the "proposed small to medium sized underground training mine". [618] This is misleading as what was proposed was an independent commercial mine, with a smaller training mine. The letter gives no indication of this. To the contrary, to the extent that profits are referred to, the letter states "[p]rofits from the project would be injected back into the local community from an independently administered social trust fund". [619] The letter emphasises the benefits of the training mine and gives no indication of any commercial mine. The letter states, "this application is no different to any other application for exploration" and that "absolutely no concessions were given". [620] Those assertions do not sit comfortably with the direct allocation of the consent to apply contrary to the recommendation of the Department. The letter as a whole is misleading. 3. For completeness, I note the letter also addresses a concern in relation to the failure to advertise the application for the exploration licence. This was also raised in the correspondence from the Department referred to in the section immediately above. It appears that contrary to the requirement in the Department's letter of 5 December 2008 that copies of newspaper advertisements be returned to the Department within a set time, this was not done. There is, however, no evidence that Mr Macdonald (or even Mr Maitland) was responsible for this failure. 4. The letter to Mr Jones was not contended by the Crown to be available as evidence of consciousness of guilt. It is, however, evidence consistent with the general approach by Mr Macdonald to emphasise the significance of the training mine component of the proposal, while downplaying, or avoiding altogether, the commercial aspect of the proposal when seeking to justify his decision to directly allocate the exploration licence. 13. Determination in relation to Mr Macdonald with respect to Count 1 13.1 Element 3 – misconduct 1. I regard element 3, proof of misconduct, as the central issue. This is consistent with the position of the parties. It is, therefore, convenient to start with this issue. 2. I have, above, discussed various aspects of the evidence upon which the Crown relies to draw an inference that Mr Macdonald misconducted himself in granting DCM consent to apply for an exploration licence. For the reasons indicated above, I have found that not all of the matters relied upon by the Crown are probative of guilt. Further, some matters I have found to be less significant than the Crown contended. This is not a case, however, where proof of any single circumstance is a precondition to proof of guilt. Rather the strength of the case is in the strands which are established considered together. It is not enough that those strands establish that Mr Macdonald made a poor decision. Further, in relying on evidence of what he did and did not do, I am mindful that he was not obliged to do anything, other than not make a decision that was not for a proper purpose. The question to be resolved is whether the evidence is sufficient to allow an inference to the requisite standard that the decision to grant DCM consent to apply was made for the improper purpose of benefiting Mr Maitland. 13.1.1 A training mine may have been a good idea 1. Before considering the circumstances probative of guilt, it is necessary to acknowledge that, on the evidence, the establishment of a training mine had clear benefits. Mr Maitland was genuine in his belief that a training mine would be of benefit to the industry in general, including by providing for increased safety. I have, above, referred to the evidence which establishes Mr Maitland's view was not peculiar to him. Mr Macdonald was entitled to accept the genuineness of Mr Maitland's views with respect to a training mine. Further, he was entitled to accept those views, they being the views of a person who was very well respected in the industry. In relation to Mr Macdonald himself, Mr Gibson gave evidence confirming that Mr Macdonald had a real interest in the safety of the miners with a particular interest in a "real life" training mine. [621] Mr Mullard agreed the proposal was innovative in that the Department had not considered anything similar before. [622] Mr Macdonald himself said he wanted to establish a training mine for the public benefit of particularly the Hunter Valley and to improve and start a new process in relation to the training of workers to improve mine safety. [623] He said he saw the public good brought by this proposal to be the synergy with the University, the expansion of training through the HVTC and the WRHS, the establishment of a community trust fund, the establishment of a Centre of Excellence and other financial benefits like the creation of jobs and royalties to the State. [624] 2. The submissions of DCM seeking consent to apply, and subsequently the application for the exploration licence, were founded, to a significant extent, on the support enjoyed by the proposal from various quarters. This was said to be evidenced by the various support letters. It is not in dispute that each of the support letters was provided in good faith. Thus, it must be accepted that the various authors perceived benefits in the proposal as referred to in their respective letters. The letters were thus a matter Mr Macdonald was entitled to take into account. 3. As explained above, I accept that there were benefits to establishing a training mine. I also accept that the establishment of a training mine had support from various quarters. The issue was not whether a training mine would be of benefit at all. The issue for Mr Macdonald (at the time) was whether this particular proposal was in the best interests of New South Wales. Of course, the evidence of any benefit to the State is relevant to whether an inference can be drawn that Mr Macdonald wilfully acted contrary to the best interests of the State. But the point to be made is the decision involved a balancing of various factors. Mr Macdonald was taken through various of these as "pros" and "cons" of the proposal. Ultimately, whatever benefit may or may not have been obtained for the State, the question is whether the Crown has proved, beyond reasonable doubt, that Mr Macdonald acted with an intention to benefit Mr Maitland, that being the driving force behind his decision, such that the decision would not have been made but for the intention to benefit Mr Maitland. 13.1.2 The limitations on relying on letters of support 1. Accepting that the views expressed in the various letters of support were genuine, reflecting the broader proposition that there were benefits to a training mine, there were limitations to the extent to which the letters could be relied upon. Some letters were from entities that stood to benefit financially from the proposal, such as the letters provided in 2007 by WRHS, HVTC and the University. With respect to the University, I note that there is no evidence of any expectation of funding at the time the consent was granted. The special conditions on the exploration licence did, however, require that DCM provide an annual payment of $250,000 to the NSW Institute for Carbon Sequestration (which, it appears, was later established under the name of NSW Institute for Frontier Geoscience) at the University. [625] While support from Xstrata, given its size, and from other mining companies was significant, it was not clear to what extent their views reflected the views of other mining companies. It is obvious that only letters from those supporting the proposal would be supplied. Further, Xstrata had an interest in the matter as it was considering a joint venture with DCM. This was indicated in Mr Maitland's letter to Mr Tudehope of 24 August 2008, that is within days of the decision to grant consent to apply. [626] While there was no evidence that this and the financial interests of the "strategic partners" were known to Mr Macdonald, it highlights the lack of an independent process to gauge the actual level of support enjoyed by the proposal. 2. In making the above observations, I accept that the process of obtaining letters of support for a proposal was not unusual or improper. Indeed, Mr Iemma confirmed this, and confirmed that the views of unions were significant to a Labor minister. [627] Mr Gibson also said that considering letters of support is not unusual. [628] But only Mr Macdonald could balance, for example, what he knew about the size of the training mine relative to the overall proposal, with the perceived benefit of the training mine component. Ultimately, while the application included letters, including some from significant individuals or organisations, those letters did not pretend to analyse the merits of the proposal from the perspective of the State. 3. Apart from the limitations on relying on the letters of support as a way of assessing the genuine level of support for the proposal, there was, additionally limited scrutiny of what was actually proposed. I have, for example, found, above, that Mr Macdonald was genuinely interested in establishing a school of Earth Sciences at the University of Newcastle. Further, geoscience was an area that was identified in the Department's briefing note of 14 August 2007 as suffering a significant shortage in New South Wales. DCM's proposal, however, while referring to the training facility being expected "to play a key role in the realisation of the University's strategy" did not make clear how it would do so. The University's letter was not specific as to what the nature of the "collaboration" was. While it can be accepted, as indicated in the proposal that a school of geoscience at the University of Newcastle may have availed itself of access to an underground mine, there was (as was accepted in submissions) no suggestion that establishing a geoscience school was in any way contingent on such access. In contrast to what can be accepted in relation to underground workers, the significance of any advantage in a training mine is not obvious in the context of tertiary education in geoscience. Mr Macdonald acknowledged that the proposal did not include funding for the University, [629] although as noted above the conditions on the licence required an annual payment to the University and Mr Macdonald may have anticipated this. There was, in reality, little real scrutiny of the benefit to be obtained from a training mine, in this, and in other respects. 13.1.3 The value of the resource and the relative size of the training mine 1. As observed above, the simple fact that there were benefits to a training mine could not justify the direct allocation to DCM. An assessment was required as to what was being given up and what was being received in exchange. As to what was being given up, the value of any coal situated in the area over which the application was made was uncertain. Similarly, the value of the grant of consent to apply for an exploration licence, and the value of an exploration licence itself was uncertain. To a large extent, this was because the presence of coal and its mineability was not well-established. As discussed above, in this regard, the situation was quite different from that which pertained with respect to Watermark and Caroona where significantly more exploration had been done. I have also above noted other significant differences between the locations, including important advantages that Doyles Creek held over those other locations. 2. The Department, while clearly favouring a competitive allocation, did not purport to place a value on the resource. On the other hand, it was understood that the area contained coal. I have referred to the evidence of Mr Mullard to the effect that the location of coal, unlike other minerals, is generally known (albeit its mineability is not). Further, DCM was one of a number of companies that expressed an interest in mining in the area. The application made by DCM was based on the presence of an estimated 91 million tonnes of mineable, soft and semi-soft coking coal. It could not be known at the time the relevant decisions were made whether the estimate would prove to be accurate. Presumably, anyone seeking to value the area would need to heavily discount any value based on the uncertainty given the relative lack of exploration. The proposal, itself, indicated that DCM expected to raise $125 million in equity funding with a further $84 million in debt funding "expected to be secured on the basis of the robust financial outcomes derived from production and financial modelling". [630] Clearly an exploration licence was regarded as being of value to investors, and there was sufficient security in the project to satisfy lenders. 3. While DCM was, it appears, willing to take a risk on the area, that is, DCM was prepared to expend significant money and effort in pursuing the area in the hope that its estimates were accurate, or at least partly accurate, and that it would be rewarded with a successful mining operation, the calculus for the State was somewhat different. Whilst a successful mining operation would result in the payment of royalties, that would be the case irrespective of the company that mined the resource. The primary factor which distinguished DCM was its willingness to establish an underground training mine. This was, however, contingent on a successful commercial mine. The submission identified, as a key risk, the prospect that the coal reserves would prove insufficient. In this event, presumably, the entire project would fail. Therefore, from Mr Macdonald's perspective, it was not possible to offset uncertainty as to the viability of the proposal with the benefit of a training mine. From the perspective of the State, obtaining the benefit of the training mine pursuant to the proposal was always going to be dependent on the establishment of a commercially successful coal mine. Having regard to this, obtaining the benefit of a training mine was always likely to involve surrendering a potentially significant asset. That was not necessarily a poor bargain. But it was one that required careful evaluation. 4. Significantly, the training mine was only a very small part of the mining proposal. What was, at least, hoped, was that the value of any operational mine would be based on something in the order of 91 million tonnes of coal. Against that, the proposal, on the information available to Mr Macdonald, was to set aside a panel containing 150,000 tonnes for the training mine. This is so on the information in the proposal, even accepting Mr Macdonald's evidence that the conditions would require a further panel to be established on exhaustion of the first panel. [631] The capital cost to establish the mine was $7 million as opposed to $209 million to develop the commercial mine. Further, the training mine itself was to be, once operational, cost neutral. The commercial mine was forecast to produce, by its fifth year of operation, a profit of $5.8 million and $1 billion over its life noting the latter figure was not explicitly stated. [632] The emphasis given to the proposal as being for a training mine, in the proposal itself and in the supporting material, overstated the reality. This was made clear to Mr Macdonald by the Department. 5. The relative size of the training mine was also reflected in the number of workers expected to be trained. The number of workers that would actually be trained once the mine was established has been discussed above. I have there found that the numbers were not such that they would have a significant impact on the skills shortage. Such impact that the numbers may have had was likely further reduced as a result of the location of the training mine in the Hunter Valley where there was at least room for doubt as to the existence and extent of a skills shortage. While there were potential other training benefits such as in hospitality and horticulture, this was a minor aspect of the proposal. Further, there was evidence that mining companies generally spend a fairly significant amount of money on training their workforce. [633] It was quite unclear as to how many of the trainees would be taken up by DCM. Given that the trainees were already located in the same area it was likely that DCM would obtain a significant number of its new recruits from the training mine. While the training may have been more extensive than that ordinarily provided to workers and of a better quality (accepting the benefits of training in an actual mine), given the cost neutral operation of the training mine, the source of trained workers for its commercial mine was a significant benefit to the proponent. This is quite apart from any additional benefit the particular proponent may have received as a result of its connection with ResCo and that company's labour hire business. 6. For the reasons given above, if successful mining was established, the benefit to the proponent was substantial. DCM would receive, putting aside start-up costs, a profitable commercial mine, in an area that was of interest to a number of other mining companies. The State would receive some benefit from the training of workers in the mine (and some other areas). If the exploration was not successful the State would receive nothing beyond the additional knowledge of the area (potentially saving future exploration costs by the State). On its face, this makes little sense from the State's perspective. While I accept that this explicit analysis was not drawn to Mr Macdonald's attention, it was made clear that for a resource with potentially 91 million tonnes of coal, the training mine was a very small component of a much larger operation. This was one of the Department's major objections to the proposal. I have, above, discussed Mr Macdonald's evidence in relation to the disparity between the size of the commercial mine and the size of the training mine. As I have observed, Mr Macdonald's evidence did not adequately address this issue, and I am effectively left without evidence as to why this concern did not, at least, lead to a higher level of scrutiny before Mr Macdonald acceded to the proposal. 13.1.4 Scrutiny of the proposal 1. I have discussed above the various organisations, which were available and capable of advising Mr Macdonald with respect to the proposal. The failure to seek advice from these bodies is significant in the light of the fact that a direct allocation was outside the guidelines together with the Department's clear and continued opposition to the proposal. The result was that, apart from the negative advice from the Department, Mr Macdonald was essentially left with the proposal itself, letters provided by the proponent, which were necessarily selective, and, if accepted, a personal view as to the desirability of a training mine. 2. The Department, in its briefing note of 22 February 2007, specifically recommended referring the matter to the MSAC. That briefing note indicated that when a similar proposal was considered by the predecessor to the MSAC, it was found by a consultant to have "many problems". While Mr Macdonald said he believed the primary problem was with respect to financing the operation of such a mine, not seeking the advice meant he was effectively blind to any other problems and the relative advantages and disadvantages of an underground mine. This is particularly significant given the length of time that had passed since the idea was last considered, with the consequent improvements in technology, the establishment of virtual training by Coal Services, and the training provided by mining companies of their own workers. 3. Similarly, the failure by Mr Macdonald to seek advice about the proposal (apart from seeking advice about the existence of a skills shortage generally) meant he was effectively blind as to the extent to which the proposal would alleviate any skills shortage. While Mr Macdonald may not necessarily have been aware the MMAC had established a formal training and skills subcommittee, I accept he had told Mr Papallo he wanted the MMAC to be "active" with respect to this issue. Mr Macdonald was aware that there were at least different views as to the existence of any skills shortage in the Hunter Valley. In these circumstances, it is difficult to understand the granting of consent to apply without Mr Macdonald having done more to inform himself of the extent to which the proposal would address any skills shortage. In this regard, I have acknowledged in the discussion above the fact that Mr Macdonald did seek the Department's advice in relation to the issue of a skills shortage. However, as I have there pointed out, what he took from that advice was highly selective and in my view is not consistent with a genuine attempt to assess DCM's proposal on its merits. 4. The above observation is further to be seen in the context of the number of training positions proposed. I have discussed that aspect of the proposal above. In addition to the limited number of trainees, it might be noted that only a proportion would receive qualifications specific to mining. While, no doubt, a job applicant who had completed an apprenticeship in a trade in a mining facility would be attractive to a mining company, it was not clear how the benefit of completing a trade certificate in a training mine compared to providing further training to persons who had completed an apprenticeship elsewhere. The briefing note of 27 May 2008 also raised the question of how any training mine would link in with existing programs. As noted above Mr Macdonald said he regarded this as a "good point" but one open for discussion and negotiation with Coal Services and other providers. This, however, never occurred. In particular, there was no attempt to contact Coal Services with respect to the proposal. 5. While it is possible the proposed number of trainees could have had an impact on an existing skills shortage, as noted above, the numbers contained in the proposal did not suggest the training mine would be significant. It is not necessary to make any finding as to what impact the proposal may or may not have had. The real point is that Mr Macdonald determined the proposal without being fully informed, in circumstances where additional information was readily available from bodies well equipped to provide it. Mr Macdonald's approach of, instead, relying on evidence sourced through the proponent is strong evidence of a desire to favour Mr Maitland. 6. Additionally, the grant of consent to apply was made prior to receiving advice as to the position of the NSW Minerals Council. Mr Macdonald made it clear in his response to the briefing note of 27 May 2008, that he regarded the demonstration of industry support as being important. At the time he granted consent to apply he was aware that the advice of the NSW Minerals Council was pending. Mr Macdonald's repeated approaches to Dr Williams prior to the grant of the consent to apply demonstrate a clear recognition of the value of the Council's support. Despite this, the grant of consent was made without waiting for the expected advice. While there were letters indicating industry support, as discussed above, these were necessarily selective and Mr Macdonald cannot, therefore, have known how uniform that support was. Nor could he have known what level of consideration was given to the proposal by the various authors or indeed how much they knew about the proposal. One thing that was clear was that while indicating support for the mine in general terms, the support letters from the mining companies did not suggest that they would necessarily seek to use the training mine. If those companies were not committed in any way to use the facility but might receive the benefit of an employee with training in mining or a trade qualification gained in an underground mining environment, it might not surprise that such a company would be supportive. 7. Further, the grant of consent was the critical step, after which the exploration licence would, in the ordinary course, follow. The grant of consent prior to the advice of the NSW Minerals Council suggests that Mr Macdonald was determined to approve the proposal irrespective of its position. 13.1.5 The financial climate 1. There was no question with respect to the evidence that the New South Wales State government's budget was under considerable strain at the relevant time. While I have not found that Mr Macdonald was required to take either of the decisions to Cabinet, that was the result of the absence of certainty with respect to the outcome of any tender process, rather than to deny the concern within the government (and correspondingly in Cabinet and in the Budget Subcommittee within Cabinet) with respect to the government's finances. There is no issue that Mr Macdonald was aware of this concern. 2. It is equally clear that coal mining was in a boom period. While I have stressed that the Watermark and Caroona allocations differed in many respects, making comparison difficult, what was clear was that mining companies were willing to make bids for consent to apply for exploration licences well in excess of what had been anticipated by the Department and Mr Macdonald. For these reasons there would have been difficulties in accurately valuing the resource at the relevant time. In any event, what is relevant is the information that was known to Mr Macdonald. With respect to that question, Mr Macdonald simply did not know what might be received. Further, given the questioning by Mr Macdonald of Mr Coutts and Mr Coutts' response, in relation to what sort of AFC could be expected with respect to Watermark, Mr Macdonald must have known the Department had no certainty around what could be expected by way of an AFC had Doyles Creek gone to tender, but, nonetheless, saw a benefit in a competitive process. And while it can be said that the provision of training would ultimately result in a financial benefit to the State, there was no analysis of this. Similarly with other potential benefits of the DCM proposal. 3. Having regard to the financial position of the State, if Mr Macdonald was genuinely intending to act in the best interests of the State, it could be expected he would only have forgone a potential AFC if the State was to receive significant benefit in exchange. The proposed training mine did not, in my view, fit that description. This is particularly so when regard is had to the reality that a training mine or training facility and a competitive process were not mutually exclusive. This is discussed immediately below. 13.1.6 A training mine and a tender process were not mutually exclusive 1. It may be recalled that, in its briefing note of 27 May 2008, the Department advised Mr Macdonald with respect to three options: a direct allocation to DCM, an allocation on a competitive basis with the requirement to establish a "training program", or an allocation on a competitive basis with a requirement to provide a payment directed towards "the establishment of broader industry training programs". It can be accepted, as was stressed by Mr Macdonald in his evidence, that neither of options two or three guaranteed an underground training mine. A proposal with a training program may or may not have included an underground training mine. However, the merits of any training program could have been assessed as part of any proposal, and in turn compared to other training programs as promoted in rival proposals. For all Mr Macdonald knew, a proposal with a training program (not involving an underground training mine) may have been assessed as superior to the DCM proposal. 2. Even if contrary to the above, it was considered essential that there be an underground training mine, the establishment of an underground training mine could have been made a prerequisite in any competitive tender process. I do not accept the suggestion that the Department's failure to provide this alternative option ruled it out, or that Mr Macdonald would have believed it was ruled out. Mr Macdonald knew that, as Minister, he was the decision-maker and the Department did no more than provide advice to assist him. If the concern with a competitive tender was the paucity of information available with respect to the site, it was otherwise open to Mr Macdonald to simply defer any decision and inform DCM that they would go onto the register of interests with respect to the area. 3. Nor do I accept that a competitive tender requiring a training mine was inconsistent with DCM's ownership of the idea. A submission was made to the effect that a competitive tender process would have failed to reward ResCo for its entrepreneurial initiative (and corresponding investment). That is, to a degree, true. Firstly, however, it was never suggested by Mr Macdonald, either in his evidence or otherwise, that this formed part of the basis upon which he made his decision. In this regard it has the quality of a hypothetical justification to be applied in hindsight. 4. Secondly, it is only true to a degree. In this regard, I note the idea of an underground training mine itself was not new. What was, arguably, new was the operation of such a mine as part of a commercial operation such that neither the State, nor any other body, would be called upon to provide funding. However, in this regard it might be expected that other miners interested in the area would be prepared to devote a small part of it for a training mine if it meant getting the allocation. To the extent that the DCM proposal distinguished itself, it was in the work that had been done to establish the various partnerships, and perhaps ResCo's role in the labour hire industry. But that was a matter that could have been considered as part of any evaluation process. Those features may well have been to DCM's advantage but the extent to which this justified an allocation to DCM was capable of a comparative analysis with other bidders. If there was something truly innovative to the advantage of ResCo's proposal, it would have received a more favourable score as part of the evaluative process. 5. Mr Macdonald gave evidence that a competitive process is more efficient when dealing with the allocation of a resource alone and therefore there was a difficulty in including a requirement such as the establishment of a training mine or facility as part of a competitive process. [634] However, the Department and the Coal Allocation Committee in particular, had significant experience in evaluating competing bids. Mr Mullard acknowledged that an additional feature such as a training mine could add some, but not an excessive, delay to the evaluation process, [635] but that this was not necessarily so. [636] He said that an expression of interest and evaluation process for Watermark and Caroona was about six months. [637] Significantly, the advice from the Department itself suggested the possibility of a competitive process involving a requirement to establish a training facility. 6. I accept that a condition requiring the establishment of a training mine may have discouraged some potential bidders. Certainly, Mr McPherson, in his evidence, said that he would not apply for a licence if it was conditional on establishing a training mine. [638] Mr Lewis also disagreed with the proposition that any mining company would have agreed to spend $7 million to establish a training mine in order to get access to a resource estimated at 91 million tonnes, as they may be willing to spend that money but building and running a training mine involves another degree of difficulty. [639] Mr Mullard also said that such a condition would require prospective proponents to consider additional factors such as what areas of the mine to use for training purposes, and some companies might consider the condition of an actual training mine as an unnecessary cost to their corporate pursuit. [640] It is not, however, possible to know how representative these views are (or were at the time). Indeed, if it was a representative view, that might indicate broader problems with the proposal which were not exposed due to the lack of scrutiny, including through the obtaining of relevant advice. 7. There is, additionally some doubt as to the significance of the various partnerships entered into. The support of organisations such as the WRHS and the HVTC was not surprising given the financial benefits promised to them. (Mr Jones' general manager's report of September 2007 indicates Mr Jones' understanding that all not-for-profit government organisations involved in the project will receive 5% of profits, annually, for their support. [641] The Community Partnership Agreement that the WRHS later signed with DCM in September 2010 indicated that DCM was to pay a fee of $40,000 per year to the WRHS for specified purposes. [642] ) There is no suggestion Mr Macdonald was aware of the financial benefit to each of these organisations, but it does make it necessary to consider what he did know about the significance of these alliances. 8. The March 2008 DCM application set out DCM's strategic alliances with various entities including itself and ResCo (a known related entity). [643] While Coal Services was listed as a "strategic alliance member" there was nothing said about this relationship at all. With respect to HVTC the proposal set out the nature of the organisation but said little in relation to how the organisation would benefit from the training mine, other than that the facility will provide HVTC with the "opportunity to develop innovative training and education pathways in partnership with the University of Newcastle". [644] 9. In relation to the WRHS, it was stated that there would be "utilisation of the mine [by the service] for training purposes" and that the service would "provide medical doctor and paramedic training at the proposed mine site". [645] While I accept the WRHS would be advantaged by access to the mine, it is not entirely clear what the extent of that advantage would be. It was not, for example, clear, the extent to which access to an underground mine would contribute to training in response to a mine disaster. It was not suggested a mine collapse would be simulated. While access to an underground mine would assist in providing familiarity with the environment, it is not clear a dedicated training mine would necessarily be required for the purposes referred to in the submission. 10. In relation to the University of Newcastle it was said that the Doyles Creek training mine was "expected to play a key role in the University's proposal to address skills shortages in the discipline of geosciences", [646] and would do so as a "provider of practical training". [647] The submission also stated, generally, that "placements will be allocated to approved training providers and tertiary institutions such as the University of Newcastle, training would be available in "mining-related disciplines, hospitality and horticulture", and "[p]ractical medical training and simulated rescue operations will … be performed at the facility". [648] In each case there was little said that enabled an evaluation of the real value of the alliances. That remained the extent of the information available with respect to the value of these alliances up to the point at which Mr Macdonald granted consent to apply on 21 August 2008. I have accepted the possibility that, having regard to the later agreement to provide funding to the University, Mr Macdonald anticipated he could extract such a commitment from DCM (and indeed that the Institute for Frontier Geoscience was established, in part, based on that funding). [649] That, however, could not be regarded as distinguishing DCM. 11. With respect to ResCo, not only was it a related entity, but its role in labour hire may have had the result that its business would benefit from the training of workers in underground mining. This, in turn, may have had the result that the financial commitment apparently offered by the proposal was less significant than appeared on the face of the proposal. Again, this raises a need for a critical analysis of the real benefits of the touted alliances. 13.1.7 Other factors 1. The matters referred to above are the matters which are, to my mind, most significant in establishing Mr Macdonald's motivation for the decision to grant consent to apply to DCM. Various other matters relied on by the Crown such as not taking the matter to Cabinet are, for the reasons discussed above, if not significantly probative of guilt, at least not inconsistent with guilt. 13.1.8 Conclusion in relation to proof of misconduct by Mr Macdonald in granting DCM consent to apply for an exploration licence on or about 21 August 2008 1. I acknowledge that the decision to grant consent to apply was for Mr Macdonald to make. I also acknowledge that in making that decision he held a broad discretion. He was not bound by the advice of the Department or the views of others. He was, however, obliged to exercise the power for a proper purpose. I am mindful of the absence of any direct evidence of an improper motivation on the part of Mr Macdonald. Such an improper motivation is not directly evidenced in any communication between Mr Macdonald and Mr Maitland or anyone else. To the contrary, the only evidence of any communications between Mr Macdonald and Mr Maitland is through arrangements made with Mr Macdonald's office, and in the presence of his ministerial staff. While there was evidence of conferences at which both were in attendance, there was no evidence of any direct contact between the two at these events. The result is that there is evidence of only four actual meetings between Mr Macdonald and Mr Maitland between January 2007 and August 2008 – the meeting of 19 January 2007 at Mr Macdonald's office, on 26 July 2007 at Prime Restaurant, on 5 November 2007 at Newcastle University and at the Strangers' Dining Room on 17 June 2008, each of which included ministerial staff. 2. There is insufficient evidence to establish the existence of a deep friendship or any political indebtedness. There is no evidence of any reward or benefit promised to Mr Macdonald in exchange for a decision favouring Mr Maitland. The evidence of motive does not rise higher than Mr Macdonald's expectation of retirement in 2009 (with no evidence that this would result in any financial difficulty). 3. As discussed earlier in these reasons these matters are not fatal to the Crown case. They do, however, require that greater scrutiny be placed on the circumstances which are present, from which it is said an inference of guilt can be drawn. 4. I am, additionally, mindful of the evidence of the energy and enthusiasm which Mr Macdonald brought to his responsibilities as a government minister. I accept that he was hard-working and was known for his commitment to his ministerial responsibilities. He was, no doubt, making many decisions and managing various responsibilities at the relevant time. It is not sufficient that the Crown prove that Mr Macdonald made a poor decision on this occasion. In this vein, it is necessary to consider the possibility that Mr Macdonald was so enthusiastic about one aspect of the proposal (the training mine) that he did not engage in a dispassionate evaluation of the overall proposal. In this regard, I note that the forensic spotlight shone upon a single decision, and the type of evaluation that results, may be very different from the evaluation being conducted when juggling multiple responsibilities. 5. Mr Macdonald gave evidence on oath that there was no improper motivation behind his decision to grant DCM consent to apply. I have considered that evidence. I remind myself that I did not have the benefit of seeing Mr Macdonald give evidence in person. Nonetheless, when I have regard to the totality of the evidence I find there is no reasonable possibility that Mr Macdonald's denial of an improper purpose was true. I have, consequently, put that part of the evidence to one side. When I have regard to the various circumstances discussed above, in combination, they are compelling. I am satisfied beyond reasonable doubt that the driving force behind Mr Macdonald's conduct in granting DCM consent to apply on 21 August 2008 was to benefit Mr Maitland and DCM such that, but for that motivation, the conduct would not have occurred. Put another way, the combination of circumstances is such as to exclude any reasonable possibility that the decision to grant DCM consent to apply was motivated by a proper purpose to an extent inconsistent with guilt. 13.2 Other elements 13.2.1 Elements 1-4 1. There is no issue that Mr Macdonald was, at the relevant time, the Minister for Mineral Resources and a public official. There is further no issue that he granted DCM consent to apply for an exploration licence under the Mining Act, on or about 21 August 2008 and this was done in the course of, or in connection with his public office. I am satisfied beyond reasonable doubt of elements 1 and 2. 2. The third element of the offence is that Mr Macdonald misconducted himself in granting the consent, and I have found this element proved. The fourth element is that Mr Macdonald's conduct was wilful. There was evidence of the obligations of a Minister within the New South Wales government as set out in the Ministerial Handbook produced by the Department of Premier and the Cabinet Code of Conduct for ministers of the Crown. As observed above, Mr Macdonald accepted in his evidence that as Minister he was obliged to perform his duties honestly and in the best interests of the State of New South Wales. He further accepted that a motive to benefit a private individual rather than the State was inconsistent with this obligation. I find that Mr Macdonald's misconduct was wilful in that he knew he was obliged not to use his position to favour Mr Maitland and DCM in determining DCM's application for consent to apply for an exploration licence. 13.2.2 Element 5 – reasonable cause or justification 1. The fifth element of the offence is that Mr Macdonald granted such consent without reasonable cause or justification. It was submitted on behalf of Mr Macdonald that, even if his decision was the result of wilful misconduct, he had reasonable cause to make the decisions the subject of counts 1 (and 3) and "was otherwise justified in doing so because of the Department's advice leading up to those decisions". It was submitted that notwithstanding the Department's view that the resource should be released competitively, the Department advised Mr Macdonald that a direct allocation with strict conditions was an option for him. It was submitted that the decision was reasonable because it allowed Mr Macdonald to "advance not only the interests of Mr Maitland and DCM but also the interests of the public". 2. The fact that the Department advised that direct allocation was an option available to Mr Macdonald did not provide reasonable cause or justification for taking that option if the result of that is partiality in favour of Mr Maitland. The Department's advice did no more than spell out alternatives, and did so in a context where the Department was aware that Mr Macdonald was at least sympathetic to the proposal. It was however, implicit that the selection of any particular alternative was only available on the basis of the proper exercise of ministerial discretion. It was not for the Department to withhold an alternative on the basis of its view that the selection of that option would involve misconduct. It was not for the Department to second guess Mr Macdonald's motivations. The advice of the Department that direct allocation was an option open to the Minister does not provide lawful excuse or justification. 3. With respect to the submission that direct allocation provided for a training mine which was in the interests of the State, and this provided reasonable cause or justification, I accept that there was a public benefit to the establishment of a training mine. It can also be accepted that Mr Macdonald saw this as a genuine advantage to the State (as opposed to, for example, a ruse that could be used to justify his favouring of this to Maitland). The simple fact that there was, amongst mixed motivations, a proper purpose cannot provide reasonable cause or justification. That would have the same effect as requiring the Crown to prove that the improper purpose was the sole purpose for the decision, a proposition which is contrary to authority. In order to find that a proper purpose, which in some way contributed to the decision, resulted in reasonable cause or justification something more would need to be shown. In this case nothing more has been shown that, in my view, would establish such reasonable cause or justification. 4. I am satisfied beyond reasonable doubt that Mr Macdonald did not have reasonable cause or justification in granting DCM consent to apply for the exploration licence in circumstances where the decision involved wilful misconduct on his part. 13.2.3 Element 6 – the conduct was serious and merits criminal punishment 1. Mr Macdonald submitted that, even if the other elements are satisfied, I could not be satisfied beyond reasonable doubt that the conduct was serious and merits criminal punishment. In support of this submission the applicant points to the transparency with which Mr Macdonald operated in considering the proposal. There is no evidence of any clandestine meetings, or offer of reward to Mr Macdonald. All meetings were conducted in the presence of at least one member of Mr Macdonald's ministerial staff. There is no evidence of any reward Mr Macdonald expected to receive. 2. It was further submitted that the grant of consent to apply, and subsequently the exploration licence did not confer anything other than a notional benefit on Mr Maitland, with any benefit accruing to him only coming after the efforts of DCM in proving the resource. Mr Macdonald contends that the loss to the State, if any, has not been proved. Against this it is submitted that the benefit in the establishment of a training mine was significant, having regard to the potential to save human life, set future trends in the training of mineworkers, and the substantial investment DCM was prepared to make to achieve this in addition to benefits accruing to other institutions such as the University, HVTC and the WRHS. 3. I do not accept that the grant of consent to apply can be treated as conferring only a notional benefit on Mr Maitland and that the conduct is therefore not serious. It is not to the point that the area may have ultimately been worthless. Nor can it be known whether other parties would have bid for the resource and if so what those bids would have been (with or without requirements for a training facility). The simple reality is Mr Macdonald, as Minister for Mineral Resources, occupied a public office of significant importance. As part of his duties in that office he was required to make a decision which could not be described as trivial. To the contrary, Mr Macdonald made a decision that favoured Mr Maitland with respect to what was, at least potentially, a significant resource. The process by which he made that decision involved a wilful failure to properly consider the merits of the proposal, leading to his ultimate determination in which he favoured Mr Maitland and DCM. I am satisfied the conduct was serious and merits criminal punishment. 13.3 Conclusion – Count 1 1. For the reasons given above, I am satisfied that each essential element of the offence alleged against Mr Macdonald in count 1 of the indictment has been proved beyond reasonable doubt. It follows that this offence has been proved. 14. Determination in relation to Mr Macdonald with respect to count 3 14.1 Misconduct with respect to Count 3 1. As with count 1, I regard this element as the central issue in the determination of count 3. 2. The decision to grant the exploration licence on 15 December was, in essence, a continuation of a single process and thus, to a significant extent, flowed from the decision to grant DCM consent to apply for an exploration licence. This should not be confused with any form of tendency reasoning. Rather, evidence tending to show that Mr Macdonald was motivated to benefit Mr Macdonald and DCM in granting the consent to apply, is also available as tending to show similar motivation in granting the exploration licence. In addition, in relation to this count, there is evidence of events after 21 August upon which the Crown relies. 3. Further letters of support were received after 21 August 2008. Those letters were evidence of support within the community, unions, and training and educational institutions (HVTC and the University of Newcastle). Again, while accepting the genuineness of the sentiments expressed, and indeed that there was a public benefit in the proposal, reliance on the letters over independent scrutiny was not, for the reasons discussed above, a satisfactory basis on which to assess that benefit, and how it was to be weighed against other considerations. This tells against the decision to grant the exploration licence having been motivated by a proper purpose. 4. Further, subsequent to the grant of consent on 21 August, in which it was noted that the NSW Minerals Council was soon to advise on its position, the Council determined that it did not support the proposal. While, as discussed above, that outcome might be described as neutral, the result was that at least from this point, Mr Macdonald should have been aware that evidence of industry support for the proposal was solely based on evidence curated by the proponent. 5. Following the meeting at the Nippon Club, the evidence is that Mr Maitland had an expectation that the exploration licence would be granted. [650] This was consistent with the evidence generally, that the grant of the exploration licence ordinarily followed the grant of consent to apply, subject to the negotiation of appropriate conditions between the proponent and the Department. 6. To the extent that Mr Macdonald claimed that the exploration licence was granted based on the recommendation in the Department's briefing note of 12 December 2008, and was therefore not granted pursuant to any improper purpose, I reject that claim. As discussed above, the Department's advice must be viewed in the context in which it was provided. That is, Mr Macdonald had already granted consent to apply, and the consistent approach was to grant the exploration licence subject to the drafting of appropriate conditions. Mr Macdonald must have, in the circumstances, understood that this was the context in which the advice was provided. 7. The signing of the exploration licence at Catalina Restaurant on 15 December 2008 was an irregular occurrence. Such documents were ordinarily executed in a more formal environment. While I accept that there may have been an expectation that some Chinese dignitaries would attend, the more obvious place to entertain such persons would be in a Parliamentary, rather than private, setting. Further, once it became apparent that those persons were not going to attend, no steps were taken to change the venue. 8. The evidence of events following the granting of consent to apply and leading up to and including the grant of the exploration licence are consistent with a motivation on Mr Macdonald's part to benefit DCM and Mr Maitland. That evidence adds to the evidence in relation to the grant of consent to apply, the basis of count 1. I am satisfied, beyond reasonable doubt, that the driving force behind the grant of the exploration licence to DCM on 15 December 2008 was to provide a benefit to DCM and Mr Maitland, such that, but for that motivation, the decision would not have been made. 14.2 Other elements 14.2.1 Elements 1-4 1. Mr Macdonald was the Minister for Mineral Resources and a public official at the time he granted the exploration licence on 15 December 2008. This was done in the course of, or in connection with his public office. I am satisfied beyond reasonable doubt that elements 1 and 2 are established. 2. The third element of the offence is that Mr Macdonald misconducted himself in granting the exploration licence, and I have found this element proved. I am satisfied beyond reasonable doubt that this conduct was wilful for the reasons given above with respect to count 1. 14.2.2 Element 5 – reasonable cause or justification 1. Mr Macdonald relied on the submissions referred to above with respect to count 1 but made additional submissions based on events between the grant of consent to apply and the grant of the exploration licence. The submissions point out that Mr Macdonald's willingness to grant the exploration licence was predicated on the presence of strict conditions and penalty provisions which were, over the months prior to the grant of the licence, drafted by the Department. Mr Macdonald ultimately received advice from Dr Sheldrake before signing the exploration licence, and consequently had reason to believe the Department was satisfied the conditions it had devised would protect the training mine component and the public interest. 2. It can be accepted that steps were taken to ensure that the public interest component of the proposal became a reality. However, in a case of mixed motivations, something more must be shown than that things were done to ensure the proper motive was achieved alongside any improper motive. I am satisfied beyond reasonable doubt that there was nothing in the circumstances surrounding the grant of the exploration licence that provides reasonable cause or justification for Mr Macdonald's wilful misconduct. 14.2.3 Element 6 – the conduct was serious and merits criminal punishment 1. Mr Macdonald's conduct in count 3 was the culmination of his decision to grant consent to apply, the subject of count 1. For the reasons given above with respect to count 1, I am satisfied that Mr Macdonald's conduct in respect of count 3 was serious and merits criminal punishment. 14.3 Conclusion – Count 3 1. For the reasons given above I am satisfied that each essential element of the offence alleged against Mr Macdonald in count 3 of the indictment has been proved beyond reasonable doubt. It follows that I find this offence proved. 15. Determination in relation to Mr Maitland 15.1 Consideration of the case against Mr Maitland 1. It is necessary to consider the case against Mr Maitland having regard only to the evidence admissible against Mr Maitland. I have reviewed the evidence and noted that which was not admitted against Mr Maitland. That evidence will form no part of my consideration of the case with respect to Mr Maitland. 2. It is also necessary to consider additional evidence admissible in the case against Mr Maitland that was not admitted as against Mr Macdonald, or which has a particular significance in the case against Mr Maitland (either inculpatory or exculpatory). In taking this approach, I am mindful that it is not appropriate to begin with a conclusion I have drawn with respect to Mr Macdonald and then add or subtract evidence in order to draw a conclusion with respect to Mr Maitland. Rather, I must start afresh in relation to the drawing of any inferences and arrive at any conclusions based only on the evidence admitted in the case of Mr Maitland. 15.2 Count 2: Element 1 in the case against Mr Maitland – proof that Mr Macdonald committed the offence 1. I have found Mr Macdonald guilty of count 1. It does not automatically follow, however, that this element in relation to count 2 against Mr Maitland is proved. As noted above, the element must be proved based only on the evidence admissible against Mr Maitland. The most significant evidence not admissible against Mr Maitland is the transcript of the evidence of Mr Macdonald, tendered by the Crown in this trial. [651] Mr Maitland eschewed reliance on any part of that evidence. That evidence must be put to one side. 2. There is a question with respect to the admissibility of the evidence of the Noble House meeting as against Mr Maitland. He, of course, was not present at this meeting and the discussions took place in his absence. Discussion at that meeting was, however, relevant for a non-hearsay purpose. That is, the various representations were relevant not for their truth (for example, that Mr Macdonald had had his time and should make way for others) but were relevant as verbal acts, and inferences are therefore available as to Mr Macdonald's state of mind – that is, that he anticipated retirement midway through the next Parliamentary term. That state of mind, although not known to Mr Maitland, was relevant to proof of element 1. 3. With respect to the exhibits from the first trial which were tendered in this trial, all of that evidence is relevant and admissible with respect to proof of this element as against Mr Maitland. Similarly, with respect to the transcripts of the evidence given in the first trial. While some of the evidence in that trial was noted as being admitted against Mr Macdonald only, that was clarified in the present trial to make clear it was not directly admissible against Mr Maitland (meaning that it was admissible against Mr Maitland to prove the offence was committed by Mr Macdonald but not otherwise). With respect to the evidence in the present trial there was no suggestion that any part of that evidence was not admissible against Mr Maitland, in proof, of this first element. 4. It is apparent from the above the evidence available against Mr Macdonald, other than his evidence in the first trial, is available in relation to proof of the first element of the offence against Mr Maitland. This evidence, for the reasons given in relation to Mr Macdonald, satisfies me that Mr Macdonald committed the primary offence. In other words, on the evidence admissible against Mr Maitland, I find beyond reasonable doubt that: 1. Mr Macdonald was, at the relevant time, the Minister for Mineral Resources, a public official; 2. in the course of, or in connection with, his public office, he granted DCM consent to apply for an exploration licence under the Mining Act; 3. in granting the consent, Mr Macdonald misconducted himself as the consent was granted for the purpose of benefiting Mr Maitland and DCM in that this was the driving force behind the decision such that the decision would not have been made but for this purpose (the improper purpose); 4. Mr Macdonald's misconduct was wilful in that he knew that he was obliged not to use his position in that way; 5. Mr Macdonald granted such consent without reasonable cause or justification; and 6. Mr Macdonald's misconduct was serious and merits criminal punishment having regard to the responsibilities of the office and the officeholder, the importance of the public objects which they serve and the nature and extent of the departure from those objects. 15.3 Count 2: Element 2, elements 3(b) and (c), elements 4(a), (b), (c), (e) and (f), and element 5 1. There was no real contest with respect to any of these elements and they can be dealt with briefly. 2. Mr Maitland was instrumental in making the application on behalf of DCM. I am satisfied, beyond reasonable doubt, that Mr Maitland intentionally assisted and encouraged Mr Macdonald to grant DCM consent to apply for an exploration licence under the Mining Act (element 2). 3. Mr Maitland was aware of Mr Macdonald's position. He intended that Mr Macdonald would grant DCM consent to apply in the course of, or in connection with, his office. He also knew that Mr Macdonald was obliged not to use that position for the purpose of providing a benefit to DCM. He accepted as much in his evidence. I am satisfied that he also knew that Mr Macdonald knew this. Accordingly, if element 3(a) is proved, I would be satisfied that element 3(b) has been proved. That is, if it is established that Mr Maitland intended that Mr Macdonald would grant consent to DCM to apply for an exploration licence where that consent was granted for the improper purpose (element 3(a)), I would be satisfied, beyond reasonable doubt, that Mr Maitland intended that Mr Macdonald would do so in circumstances where Mr Macdonald knew he was not obliged to use his position in this way (element 3(b)). 4. I am similarly satisfied that if element 3(a) is proved, element 3(c) would be proved. That is, if Mr Maitland intended that Mr Macdonald would grant consent to DCM to apply for an exploration licence in circumstances where the consent was granted for the improper purpose, I would be satisfied, beyond reasonable doubt, that he intended that he would do so in circumstances where Mr Macdonald did not have reasonable cause or justification (element 3(c)). Element 3(a) will be discussed in further detail below. 5. Based on the evidence, I am satisfied beyond reasonable doubt that, at the relevant time, Mr Maitland knew Mr Macdonald was a public official (element 4(a)). I am similarly satisfied he knew that Mr Macdonald had the power to give consent to DCM to apply for an exploration licence under the Mining Act and that there was a real prospect that he would grant such consent (element 4(b)); and that he knew that in doing so Mr Macdonald would be acting in the course of, or in connection with, his public office (element 4(c)). I am also satisfied that Mr Maitland knew that Mr Macdonald knew that he was obliged not to use his position to grant the consent to apply for the improper purpose (element 4(e)). I am also satisfied that Mr Maitland, at the relevant time, knew that if Mr Macdonald granted consent for the improper purpose it would be without reasonable cause or justification. 6. Finally, in the event that Mr Maitland was aware that Mr Macdonald had granted the consent to apply for the improper purpose (element 4(d), which will be discussed further below), I would be satisfied that Mr Maitland was cognisant of facts sufficient to result in Mr Macdonald's misconduct being serious and meriting criminal punishment having regard to the responsibilities of the office and the officeholder, the importance of the public objects which they serve and the nature and extent of the departure from those objects. My reasons in this regard are essentially those articulated with respect to Mr Macdonald. 15.4 The real issue – Mr Maitland's state of mind in relation to Mr Macdonald's misconduct (element 3(a) and element 4(d)) 1. The real issue in relation to Mr Maitland relates to these elements. Has the Crown proved, beyond reasonable doubt, that Mr Maitland intended that Mr Macdonald would, in the course of, or in connection with, his public office, grant consent to DCM to apply for an exploration licence in circumstances where the consent was granted for the improper purpose? If so, has the Crown proved beyond reasonable doubt, that Mr Maitland, at the relevant time, knew that if Mr Macdonald granted the consent sought he would be misconducting himself because the consent would be granted for the improper purpose? These questions, while not equivalent, involve significant overlap. For convenience, I will deal with the issue in terms of intention, before considering, if necessary, knowledge. 2. There is a significant body of evidence marked out as not directly relevant to Mr Maitland. That evidence is not admissible to prove the state of mind of Mr Maitland and, therefore, has no bearing on these elements. 3. Before turning to the more specific evidence available to the Crown to prove Mr Maitland's intention that Mr Macdonald would misconduct himself, it is important to acknowledge the significant difference between the case against Mr Maitland and that against Mr Macdonald, that being their different roles and responsibilities. Mr Macdonald had obvious responsibilities as a government minister. Mr Maitland had no such responsibilities. He had only the common responsibility to obey the law, together with his obligations arising as director of a corporation. In circumstances where I have been unable to find proved the existence of a "strategy" engaged in by the accused in concert, the Crown case is one in which essentially requires me to draw an adverse inference with respect to Mr Maitland's state of mind largely based on the actions of Mr Macdonald and the resulting benefit accruing to Mr Maitland. . . In its simplest form, the Crown case is it would have been obvious to Mr Maitland that Mr Macdonald was giving him favourable treatment. But Mr Maitland was not making the decision. It was not for him to second-guess Mr Macdonald's motivation or to analyse the merits of his proposal against any potential alternatives. 4. It is also relevant to note in this context the undisputed evidence that Mr Maitland had a long standing interest in the establishment of a training mine. While he was, no doubt, commercially motivated, equally there can be no doubt that he was also motivated by the prospect of the establishment of what, for him, was a long-term goal to improve training, and ultimately safety in underground mining. The evidence establishing this has already been discussed in detail above. 5. This is, of course, not fatal to the Crown case. But it does provide a prism through which evidence in the Crown case is viewed, attenuating the strength of some of the inferences upon which the Crown relies. 15.5 The process leading up to the March 2008 submission from Mr Maitland's perspective 15.5.1 The meeting of 15 January 2007 1. It is necessary to consider the process from the perspective of Mr Maitland. As discussed above, he had retired from the CFMEU in 2006. He said his expectation was he would leave mining and pursue other interests. He said that, in around August or September 2006, he was told by Mr Peter Murray to expect a telephone call from Mr Ransley. [652] He subsequently met with Mr Ransley, then Mr Poole and Mr Martin of EMC in Toronto in around October 2006. He said Mr Ransley and Mr Poole were proposing to establish a mining company which was safety and health conscious and union and employee friendly. [653] Mr Maitland said they were interested in Mr Maitland joining them due to his good reputation in the industry with respect to the pursuit of health and safety issues. 2. On 15 January 2007, Mr Maitland attended a meeting with Mr Ransley, Mr Poole, and Mr Chisholm of ResCo, Mr Martin and Mr McCowan of EMC, Mr Randall and Dr Palese of Comet Coal and Coke. Mr Chisholm gave evidence of the meeting, and his notes were tendered. [654] 3. Dr Palese was a geologist and had prepared a memorandum entitled Doyles Creek Exploration Area. [655] He had identified two areas, ELA 1 and the smaller ELA 2 as having prospects for a coal mining operation. ELA 1 became the subject of the later application. The report identified the "principal economic target" of the proposal as the Whybrow Coal Seam and part of the Redbank Creek Seam, "with total inferred in situ mineable resources estimated at 125 million raw tonnes" of soft or semi-soft coking coal. [656] The report indicated the following as advantages of the project: [657] "[1] One of the very few areas still with vacant title, with sufficient coal resources to enable a medium to large size mining operation (refer to Figure 1). [2] Good quality, known "brand" coal resources, not difficult to market and known to be well regarded by the Japanese market. [3] Closeness to coal infrastructure and services." 1. Mr Chisholm in his evidence said that Dr Palese told the meeting that, in his opinion, most other geologists were wrong in their assessment of the faults in the area, in that he believed the coal was accessible whereas others did not, due to that faulting. [658] The report also referred to the Department's drilling results providing evidence that "the igneous intrusions do not affect the target coal seams". [659] 2. It is apparent from Dr Palese's report and the evidence of the meeting that the purpose of the meeting was to discuss a commercial opportunity. There is no reference in Mr Chisholm's notes of the meeting to any discussion of a training mine. [660] As to Mr Chisholm, he did, however, agree that whether it was at that meeting or later, from the early stages the training mine was an integral part of the Doyles Creek proposal. [661] 3. Mr Maitland said, in his evidence, that the idea of a training mine arose prior to the meeting with Dr Palese. [662] Whether this is so or not, it is clear that the focus of the meeting was a commercial proposal. Mr Poole confirmed that ResCo's focus at that time was getting the business going, although he said this "included the training aspects". [663] Mr Poole said that it was Mr Martin of EMC who brought the Doyles Creek proposal, which Dr Palese presented on, to DCM and agreed that Mr Martin's proposal was for a commercial mine. [664] While Mr Poole was quite adamant that a training mine was mentioned because he recalled Dr Palese saying "good luck with that" in response, [665] it would appear that from the perspective of Mr Poole, and most likely Mr Ransley, the interest in training to a large extent related to the commercial benefit that might be obtained by the labour hire side of ResCo's business. 4. It is to be recalled that at this time Mr Maitland had a meeting scheduled with Mr Macdonald as a result of his appointment as chair of the Coal Competence Board. Mr Poole said that during his initial breakfast meeting with Mr Maitland at the end of 2006, they discussed the benefit that Mr Maitland would bring to ResCo, which arose from his history in the union movement, and his resulting experience in negotiations with Government. He said there was no discussion of Mr Maitland having access to politicians. [666] It may have been that neither Mr Ransley, nor Mr Poole had any experience in dealing with politicians and government, [667] and Mr Maitland's background was of benefit in this regard. But the advantage of working with Mr Maitland went further. Despite Mr Poole's express disavowal, there can be little doubt that Mr Maitland's access to the relevant minister made Mr Maitland's involvement in ResCo attractive to Mr Ransley and Mr Poole. Telephone discussions between Mr Ransley and Mr Maitland with respect to a prospective business relationship followed the 15 January meeting and resulted in a note from Mr Maitland to Mr Ransley of 16 January. The relevant parts of the note are set out below: [668] "1. I am satisfied with a remuneration package which is made up of (a) Board sitting fee as chairman of $35,000 per annum plus superannuation. (b) $25,000 international travel allowance for work on the Workers Capital Committee, used at my discretion. (c) Reimbursement of all expenses in the role of chairman on company business (travel, accommodation, incidentals etc) and (d) A grant of 5% equity in the company. 2. In my meeting with Minister Ian McDonald[sic] on Thursday the 18th January I will make a presentation in support of RESCO being granted an exploration licence over ELA 1 and/or ELA 2 as the case may be. Arguments in support will include: (a) Lack of skilled workers for the industry (b) RESCO wants to develop a training mine (c) RESCO will receive support from industry, federal government and unions, (d) RESCO needs new lease to establish a training mine (e) Old mines have their own particular problems (f) New mine can be specifically designed (g) RESCO would start training at unused mine until new mine is established, possible 2-3 years with fast track (h) ELA 1 and/or ELA 2 have been, to date, unwanted by operators because of perceived faults and intrusions. (i) RESCO wants invitation by Minister for expression of interest. … By the way, the current Minister for Mines and Energy in Queensland, Jeff Wilson, is a personal friend and a former employee of the CFMEU in Queensland. I am organising a meeting with him to discuss China and coal competencies for the week commencing the 5th February." 1. It is clear from this note that it was intended that Mr Maitland would use his access to Mr Macdonald to attempt to persuade him of the merits of ResCo's proposal. 2. From the meeting with Dr Palese, it is clear that the participants saw at least the prospect of a lucrative commercial mine. It also appears (having regard to para 2(h)), that Dr Palese, and in turn, the participants in the meeting, understood that the area had been wrongly overlooked. In this regard, I would accept that Mr Maitland saw an opportunity to establish a commercially successful mining operation by obtaining a lease over an area deemed to be unworkable, which could, at the same time, provide the benefit of a training mine to assist with a perceived lack of skilled workers in the industry. In other words, at least at the time Mr Maitland agreed to take a role in ResCo, it was not predicated on any assumption that he would assist in obtaining an exploration licence other than on a legitimate basis. Indeed, there is no evidence that, at the time of this meeting, Mr Macdonald had any awareness that Mr Maitland might ever become involved in a commercial mining operation. In other words, at this stage there is no evidence that Mr Maitland had any basis to think that he may receive favourable treatment from Mr Macdonald (beyond, perhaps access, and respectful consideration of any proposal). 3. As discussed above, Mr Maitland met with Mr Macdonald on 19 January 2007 at which meeting the "training mine" proposal was discussed. I put to one side Mr Macdonald's evidence of the meeting. Mr Maitland then sent his "briefing note" to the Minister's office on 22 January 2007. [669] That note and the events it prompted are, again, discussed above. 4. Evidence specific to Mr Maitland was given in relation to the drafting of the 15 February 2007 ResCo submission, including the involvement of Mr Stevenson, a partner at Sparke Helmore who was also a shareholder in ResCo. [670] It is not suggested there was anything inappropriate or untoward in Mr Stevenson's involvement. Mr Maitland submitted that, to the contrary, the involvement of a reputable law firm with significant influence in the Hunter Valley told against any impropriety. Certainly, the Crown at no stage suggested Mr Stevenson was criminally involved. The impropriety alleged by the Crown against Mr Maitland was, however, not overt. It is, in essence, that Mr Maitland must have known, on the information known to him, and his history with Mr Macdonald, that Mr Macdonald was granting the approvals to favour him. On the Crown case, a person in the position of Mr Stevenson was not necessarily privy to the same information as Mr Maitland and had no reason to have the same awareness. I regard the involvement of Mr Stevenson (and other persons whose involvement Mr Maitland submitted told against impropriety) as neutral. 5. The minutes of a ResCo Board meeting of 28 February 2007 were tendered. [671] They record Mr Maitland's report to the Board on the Doyles Creek proposal. In particular they record that Mr Maitland had been told by Mr Hewson that no consideration would be given to the application until after the State election on 24 March 2007. The Minutes also record that Mr Maitland had been told by Mr Coutts that the area sought contains some environmentally sensitive areas and further that Mr Coutts had "suggested that the Minister may decide that the [exploration licence] should go to tender". [672] Otherwise it appears Mr Maitland reported that he was continuing his discussions with Coal Services and HVTC. 15.5.2 The meeting of 8 March 2007 between Mr Maitland, Mr Hewson and Ms Tan and the "potential probity issues" 1. The next event of significance in the case against Mr Maitland requiring separate discussion is his meeting with Mr Hewson and Ms Tan and the briefing note dated 26 March 2007 subsequently written by Mr Maitland. While this was led in the case against Mr Macdonald and has been discussed above, I did not find it to be probative of Mr Macdonald's guilt. The evidence is of greater significance in the case against Mr Maitland. 2. For the reasons given above, it is not clear precisely what Mr Maitland had access to, that is, the substance of the contents of the Department's briefing note dated 22 February 2007 or the note itself. Either way, I would not find that Mr Maitland believed he was receiving favourable treatment by being provided with this information. It was no part of the Crown case that Mr Hewson or Ms Tan were engaged in the misconduct alleged against Mr Macdonald. Consistent with this, and particularly given my lack of satisfaction that Mr Maitland was given a copy of the note, Mr Maitland had no reason to think that they were doing other than their jobs. Be that as it may, as a result of the meeting Mr Maitland was aware of the matters which he later set out in his note of 26 March 2007. Critically, he was aware that the Department had advised that a proposal for a training mine had been considered by the Mine Safety Council (the predecessor of the MSAC) and not pursued; that this decision was supported by the CFMEU; that there would be competition if the area went to tender given the interest of others; and that the Department had suggested that Mr Macdonald "may wish to consider" referring the ResCo proposal to the current MSAC. 3. Mr Maitland, when questioned about his note of 26 March 2007, accepted he was aware of the Department's reference to "probity issues" in the briefing note of 22 February 2007, despite it not appearing in his report of 26 March. I have, however, commented above, that it was not clear to what extent Mr Maitland recalled the detail of this meeting. Later in his evidence he expressed uncertainty as to any awareness that probity issues had been raised. [673] As I have observed above, much was made of the reference to "potential probity issues". Mr Maitland relied on evidence that Mr Coutts had said, in other proceedings, that once a more substantial application was made "those probity issues were no longer of the same magnitude that they needed to be raised again". [674] There was, however, no suggestion Mr Maitland was aware of Mr Coutts' view prior to its expression in investigations subsequent to the events. This does no more than highlight the point that it is necessary to focus on what was known at the time, and the inferences able to be safely drawn. Mr Maitland was a former union official and also on the Coal Competence Board. There were potential issues with a direct allocation in circumstances where there were other interested parties. There were also potential issues with the paucity of information in the proposal (and I have above, contrasted its length with that of the subsequent submission), as well as the proximity of the election thought to be likely to result in Mr Macdonald losing the portfolio. Potential probity concerns were a matter that may have, and perhaps should have, given Mr Maitland pause. It was not, however, Mr Maitland's direct concern. 4. It is instructive to consider what was said in Mr Maitland's note as to the pursuit of the application in the light of the Department's advice. Mr Maitland's note acknowledges the existence of "challenges" in obtaining approval. He refers to a need to show that circumstances have changed since the Gibbons' report, and that a training mine would be in the public interest. With respect to the former, he refers to the present "extreme shortage of underground mining skills" and the support for the present proposal from sources such as HVTC, Coal Services and the CFMEU. There is no suggestion the claimed shortage of skills might be contentious. The support of Coal Services and the CFMEU may have been optimistic (albeit support was received from some parts of the latter). 5. The note acknowledges as a "major issue" the potential for an open tender "which could result in unrealistic bids for the resource". [675] It is plain, and Mr Maitland acknowledged, that there was a desire to avoid any competitive process. [676] Commercially, that is entirely understandable. The note, on my reading, is consistent with Mr Maitland being somewhat discouraged by the Department's position but, nonetheless, maintaining a position that the ResCo proposal was able to offer a positive public good which would justify the matter not going to tender. The concluding paragraph of the note is significant. Mr Maitland states: [677] "My suggestion is that we conclude the [memoranda of understanding] with HVTC, CSPL and the CFMEU and then meet with the new Minister as soon as possible." 1. The context is, of course, the impending State election. It appears that Mr Maitland did not regard the strength of his proposal as being dependent on the identity of the relevant minister. Rather, he was willing to continue his work to establish the various memoranda of understanding and then meet with the Minister, who he assumed would be the "new Minister" (noting, as stated above, Mr Maitland had been at this time advised that no decision would be made before the election). This is inconsistent with him having the expectation at this stage that the ResCo proposal would only succeed if the Minister engaged in misconduct. Further, the submission of the Crown that Mr Maitland was aware that "probity issues" had been identified on the basis of his union background in the context of Mr Macdonald being a Labor minister, and the fact that he had deliberately omitted these from the note, must fail given the implication in the note that the proposal would be going forward with the new (presumably, or at least potentially, non-Labor) minister. 2. Of course, as it transpired, Labor government was returned and Mr Macdonald remained Minister. Further, Mr Macdonald did misconduct himself. But the evidence to this stage does not suggest Mr Maitland expected or intended this. If anything, it positively suggests the contrary (noting though, that the onus is, of course, not on Mr Maitland to prove that that is so). 15.5.3 ResCo Board meeting on 3 April 2007 1. ResCo held a Board meeting on 3 April 2007. This followed the election and Mr Macdonald being (again) sworn in, amongst other portfolios, as Minister for Primary Industries. [678] The minutes record: [679] "[Mr Maitland] reported that the Department were now suggesting that the tender process could be run for the Doyles Creek resource. It was therefore imperative that [Mr Maitland] continued discussions with the Department following the recent letter sent by ResCo to the Department requesting Minister's consent to apply for an exploration licence." 1. The minutes go on to record that Mr Maitland was speaking with the HVTC, Coal Services and the CFMEU and would seek to progress these discussions with a view to signing memoranda of understanding with these organisations and other potentially interested parties. Mr Ransley's report as Managing Director on the same date referred to setting up a subsidiary for the purposes of the Doyles Creek enterprise. It then states: [680] "I believe that once we have received [Mr Maitland's] report we should make the decision on whether to set up a subsidiary or not. My thoughts are that if we are able to bypass the tendering process and have the minister grant us the ELA we should go for it, however if this lease was to go to tender I believe that we should drop it and move on to something more beneficial. I will be guided by the board." 1. This is consistent with Mr Maitland, and ResCo more generally, seeking to progress the application on the footing that the proposal would provide a basis on which a direct allocation of the exploration licence would be justified. There appears to have been no certainty on the part of Mr Maitland or ResCo that this would be achieved. The fact that Mr Ransley, at least, was in favour of abandoning the proposal rather than competing at tender suggests to me a limited confidence in Dr Palese's report. In other words, had ResCo been confident that the area was, in fact, reliable for something in the order of 100 million tonnes of coking coal (and that the information they had from Dr Palese put them at an advantage when compared to others), [681] a willingness to offer some money by way of a bid might have been expected. That, of course, would also have been dependent on being able to raise that money. It would appear that either the extent of the gamble that ResCo was prepared to make in relation to Doyles Creek was limited, or their confidence in their ability to raise money for a bid was limited, or both. 2. The Crown submission was that obtaining an exploration licence by direct allocation was an essential component of the "DCM strategy". Based on Mr Ransley's indication that if they were not able to obtain a direct allocation they would look elsewhere, this appears to be true. But there is nothing wrong with such a business strategy. While the abandonment of Doyles Creek failing a direct allocation may be consistent with a view that ResCo was not willing to pursue the area in the absence of favourable treatment, there are other inferences available to be drawn. Contrary to the Crown submission, the evidence that DCM was interested in Doyles Creek only if it was able to obtain a direct allocation does not advance the Crown case. 15.5.4 The CFMEU's position 1. The next event in the evidence necessary to discuss in the context of Mr Maitland that was not in evidence against Mr Macdonald is the CFMEU's position. was the CFMEU's central executive meeting on 13 June 2007. This was attended by Tony Maher, Peter Murray, Andrew Vickers, Wayne McAndrew, Ian Murray and Greg Betts. The minutes indicate that the Executive took "a clear position" in relation to the training mine proposed by Mr Maitland. [682] That was that, while the union recognised and supported the need for trained workforces, "it is more a matter for the industry and the union will not be involved in arrangements with the project". [683] Mr Maitland gave evidence that he met with Mr Maher who made it clear that the national office would not support the proposal. [684] Despite this, Mr Peter Murray wrote as general secretary of the CFMEU Mining and Energy Division to Mr Macdonald on 8 August 2007 raising a "void" in the provision of on-site facilities for training of new workers and rehabilitation of existing workers, and the need for industry to develop a strategy. [685] It will be recalled that no reference was made to the training mine specifically. However, Mr Peter Murray by letter dated 7 July 2008 wrote, this time as chair of United Collieries, but on CFMEU letterhead (United Collieries was half owned by the CFMEU), indicating support for the training mine. [686] Mr Ian Murray on 22 August 2008 wrote a letter as Northern District President of the United Mineworkers' Federation (a division of the CFMEU) indicating support for the proposal. [687] While Mr Maher indicated this should not have been done, his view of the propriety of the actions of Messrs Ian and Peter Murray is not relevant. While Mr Maitland knew he did not have the support of the CFMEU, it is less clear that he was aware that Mr Macdonald knew this. 15.5.5 Prime Restaurant meeting on 26 July 2007 , "the strategy" and the process leading to the submission made on 18 March 2008 1. The next major event from Mr Maitland's perspective was the meeting at Prime Restaurant on 26 July 2007, at which Mr Ransley and Ms Tan were also in attendance. This was the first meeting between Mr Maitland and Mr Macdonald after the election and has been discussed above. It is, however, necessary to put aside Mr Macdonald's evidence in relation to this lunch. As noted above, Mr Macdonald's return as Minister was somewhat unexpected. For the reasons given above, the evidence does not satisfy me that a "strategy" was developed between Mr Macdonald and Mr Maitland (at least not one where Mr Maitland would obtain letters about skills shortages which did not mention the training mine, so that the grant of the exploration licence to DCM to establish a training mine as part of its proposal would appear justified). 2. While the setting for the meeting was perhaps ill-advised, this was not Mr Maitland's concern. This aspect was also, perhaps, countered by the presence of Ms Tan. From Mr Maitland's perspective, the evidence is consistent with the relevant minister being interested in his proposal, and consequently willing to meet. It was an advantage that Mr Macdonald appeared to enjoy Mr Maitland's company and was thus willing to meet over lunch and Mr Maitland, no doubt, exploited this to further his ambitions. Further, the evidence is consistent with Mr Maitland, as a result of that meeting, obtaining an understanding that in order to obtain a direct allocation it would be necessary to demonstrate that the proposal addressed some need such that it was in the public good. As discussed above, the positions of the Crown and the accused were not far apart. Mr Maitland accepted that his "strategy" was to firstly establish that there was a skills shortage before proposing the training mine, but this was not a strategy concocted with Mr Macdonald. [688] 3. It might be noted at this juncture that, in addition to the letters received at the instigation of Mr Maitland, Mr Macdonald obtained the briefing note dated 14 August 2007 containing the Department's advice with respect to the skills shortage in the mining industry. There is no evidence that Mr Maitland was aware of this advice. 4. There was some evidence admitted against Mr Maitland only, or at least not necessarily known to Mr Macdonald, with respect to events between the Prime Restaurant lunch and the submission of 18 March 2008. The Crown relied, for instance, on Mr Maitland's drafting of support letters submitted to Mr Macdonald by others. However, in circumstances where the Crown accepted the letters reflected the genuinely held views of the signatories, nothing can be drawn from this. In any event, the drafting of a letter or document for another person is a relatively unremarkable event. (That said, the fact that it is unremarkable that an interested party might draft a letter on behalf of another perhaps says something, or should have said something, about the value of the letters.) 5. Following the Prime Restaurant lunch, there was evidence, not admitted against Mr Macdonald, of a meeting on 21 November 2007 between Mr Maitland, Mr Ransley, Mr Poole, Mr Martin, Mr Ireland, Mr Chester (Opes Prime) and Mr Stevenson (Sparke Helmore, but also a shareholder in ResCo). Mr Stevenson's notes of the meeting and a transcription of them were tendered. [689] It appears that at the beginning of the meeting, Mr Ransley spoke followed by Mr Maitland. It is convenient to set out the transcription of Mr Stevenson's notes as to what was said by each: [690] "Craig R Andrew P John M Vince M Lawrie Ireland Mike Chester (Opes Prime) JCS [Craig Ransley] 1. Department require mine plan to determine if to go to tender for EL. 2. Need bankable document to present to Dept. 3. Mike Chester - pull it together/ structure finance 4. Considering capital raise of 250K in CR - don't want to spend $1M - don't want to have to go to tender - no guarantee of return for shareholders 5. So we … "pre feasibility" study with "spin" for training mine 6. So we sell as benefit to state but can stand alone commercially ie pre feasibility is that it can stand alone. [John Maitland] 1. Background in proposals for training mine → tried in 2000 but no financial backing - proposed closed mine. 2. Training mine will operate with producing mine. ↓ Training facility → UNI/HVTC → with have to operate financially independent ↓ 3. Minister (Ian McDonald(sic)) supportive → UNI/HVTC involvement ↓ Alan Coutts - was a sceptic → but need feasibility package. 4. "Community involvement" - UNI/HVTC/ Westpac helicopters ↓ 5. UNI → assist in design/materials handling HVTC → supportive (Milton) [6. Put in place → put in place an option for financial backer (JV partner) - eg to convert when get the nod to proceed] ?? 7. Minister - want him to exercise discretion → not tender or EOI. 8. Need to show commercially sustainable mine with training facility. 9. Tonnage - 60m?? [but we think 140m] ↓ Therefore model on 60M 10. Minister wants assistance to establish chair of mining at Newcastle University" 1. Mr Maitland was cross-examined in relation to this meeting. The following evidence was given with particular reference to point 5 attributed to Mr Ransley: [691] "Q. Mr Ransley characterised the training mine as a spin? A. Well, that is what Mr Stevenson recorded. Whether or not that was Mr Ransley's words or that was Mr Stevenson's interpretation of his words. Q. It was, I would suggest to you, always the case that the training mine was a spin for getting a commercial mining exploration licence? A. That's not true, and if you have a look at the efforts we put into involving some of the most reputable companies and institutions to be involved in our operation, you cannot - you are suggesting - I don't accept what you are suggesting." 1. Mr Maitland may have had a long standing philosophical commitment to establishing a training mine, but he must have known that the other participants in this meeting did not have his background. They were interested in a commercial venture. He had thrown his lot in with them. The reality was that they were trying to obtain an exploration licence and did not want to have to compete with other interested parties. It was clear that they needed to provide a basis on which they would receive a direct allocation (contrary to the Department's advice). Quite clearly, the basis upon which they sought to do so was the public good in a training mine. While Mr Maitland resisted the label "spin", the training mine, including the related strategic partnerships, was the selling point of the proposal. To similar effect was the observation "we sell as benefit to state but can stand alone commercially" in point 6 attributed to Mr Ransley. [692] It is, having regard to this context, unsurprising that Mr Ransley would describe the training mine as "spin". This is particularly so, when the submission subsequently revealed that the training mine was not intended to be, in the scheme of things, a significant cost in the establishment and running of what was intended to be a successful commercial operation. 2. Mr Maitland's observations as recorded by Mr Stevenson are essentially consistent with a frank assessment of the situation. That is, there had been prior proposals for a training mine, where the stumbling block was the lack of financial backing. He set out a belief that Mr Macdonald was supportive but Mr Coutts was sceptical. The notes suggested that Mr Coutts' attitude was something that needed to be addressed (rather than something that could be put to one side on the basis that they had the support of the Minister and this alone would be sufficient). Mr Maitland suggested that, while DCM had a belief that there may be 140 million tonnes of coal in the area, the proposal should be based on 60 million tonnes. Mr Maitland, in his evidence, accepted this was based on what it was understood the Department believed the area contained. While the proposal ultimately referred to a figure of 91 million tonnes, and not the 60 million tonnes here suggested, Mr Maitland's position at this meeting suggests a keen awareness to tone down the potential value of the resource in order to justify its allocation. This is consistent with the clear (admitted) desire on the part of Mr Maitland and DCM to secure a direct allocation. 3. Acceptance that the training mine was understood by the proponents to be in the nature of "spin" does not establish that approval would require ministerial misconduct, nor, a matter one step further removed, that Mr Maitland intended that Mr Macdonald would misconduct himself. Mr Maitland acknowledged in his evidence that he pursued a direct allocation as it was in the best interests of the people to whom he owed a fiduciary duty and "if [he was] not arguing for the best set of circumstances for [his] company" as chair, "then there's something wrong with [him]". [693] While Mr Maitland was less forthcoming with respect to the personal benefit to him, this was also acknowledged. Mr Maitland may have been trying to get a bargain for ResCo (and himself). Whether he was seeking to do so intending that bargain would be facilitated by Mr Macdonald's misconduct is to be considered in the light of all the evidence. 4. From the evidence admitted against Mr Maitland it is apparent that PricewaterhouseCoopers (PwC) were engaged by DCM to assist with the preparation of the submission. There was a meeting with Mr Demura and Ms Ahchow of PwC for this purpose on 19 December 2007 at the Newcastle office of Sparke Helmore. In attendance at that meeting were Mr Maitland, Mr Ransley, Mr Ireland, and Mr Stevenson (of Sparke Helmore) amongst others. [694] The handwritten notes of Mr Demura and a transcription of them were tendered against Mr Maitland. [695] Those notes are consistent with the discussion above. Mr Maitland is recorded as saying that the training mine had previously received "mixed support" and identifying a lack of "sustainable financial arrangement" as a problem with previous models. 5. The notes record Mr Maitland saying that "reserves are scarce as hen's(sic) teeth", [696] and then later record: [697] "Government: Minister supportive and [public service] not so enthusiastic due to prior history and came down to economics and who is going to pay for it. →DC→need financially sustainable model →Centre of excellence for mining and training for industry →community and State benefits. →Need to demonstrate benefits and not a goldmine for entrepreneurs. … Minister risk - incorrect discretion [therefore] need for a compelling argument" 1. The reference to "Minister risk" and "incorrect discretion" is of note. The awareness that the Minister might "incorrectly" exercise his discretion is at the heart of what is in issue with respect to Mr Maitland. Mr Maitland was taken to these notes. [698] The following evidence was given: [699] "Q. The need for a compelling argument that was discussed was the need to present a justification for the direct allocation of the resource that was not in fact in the best interests of New South Wales? A. I agree with the first comments that you made, and that is that we had to put a compelling argument for the direct allocation of the resource, but you've added to it "not in the best interests of New South Wales". That was never said. And do you think any of these organisations would be involved in any of this sort of stuff (indicated document) if they had the slightest idea that there was anything wrong with it? We would have expected our lawyers ‑ and I think lawyers have a ‑ don't they have a responsibility to tell their clients if they're doing something wrong?" 1. Mr Maitland's response to the need for a "compelling argument" was understandable and reasonable. He rejected the idea that it was "not in the best interests" of the State. He was, however, not asked about what appears to be a concern as to the Minister failing to properly exercise his duty. There was no exploration of what was actually said, or by whom. For all I know, this part of the note may reflect an internal thought of the author, never actually expressed at the meeting. If something along these lines was actually expressed, it is not clear what it was. On its face it may reveal a concern that the Minister would exercise his discretion to grant the application without a proper basis. But it may also be a concern the Minister might get it wrong by not granting the consent. The words "[therefore] need for a compelling argument" support this. The note is some evidence that there was advertence to the Minister's obligations and a concern in that regard. However, it is also the case that, if expressed, this was done in the presence of outside consultants (PwC) and also Mr Stevenson. There is no suggestion that any impropriety was so open as to include people at this level. In this regard, Mr Maitland's protest that it is unlikely that persons such as the consultants and Mr Stevenson would have been willingly involved in the submission if it involved corruption has force. At the very least, I would not find that Mr Maitland or other parties to ResCo would have been so bold in a meeting of this nature, as to openly acknowledge a need to cover up the Minister's anticipated wrongdoing. In these circumstances, this part of the note, at best, goes no further than providing evidence of an awareness of a need to provide a basis on which Mr Macdonald could properly exercise his discretion. 2. There was a greater examination of the reference in the earlier part of the notes to the need to ensure the allocation was not a goldmine for entrepreneurs. The following evidence was given: [700] "Q. Mr Maitland, I'd suggest that you knew that a direct allocation would be precisely that, a gold mine? A. A direct allocation would provide you with the opportunities to spend money, and if you were successful in finding a viable resource, there could very well be a very big return on investment. Q. You knew that directly allocating the exploration licence would not be in the best interests of New South Wales? A. No. That's why we put a project together which essentially had the involvement of so many organisations which stood to benefit from a licence, a mining operation, that there were going to be significant benefits to the State of New South Wales." 1. Mr Maitland's belief that the proposal was not in the best interests of New South Wales was a matter the Crown sought to prove in order to establish that he believed that Mr Macdonald had the same view, and consequently that it was Mr Maitland's intention Mr Macdonald would engage in misconduct in granting the consent to apply. Clearly, there was a view that the enterprise was potentially profitable. Equally clearly, as Mr Maitland repeatedly stressed (as did Mr Poole and Mr Lewis), it could also fail. That prospect of failure, contrary to the tenor of some of what Mr Maitland said, did not mean that DCM were not out to obtain a significant benefit through the direct allocation of the exploration licence. The notes of the meeting with PwC suggest that Mr Maitland and DCM knew that if they wanted this benefit, it was necessary to justify it. The question that remains is whether Mr Maitland believed any justification was so lacking that Mr Macdonald would know it was lacking, such that its approval would require him to misconduct himself. 2. Subsequent to, and it appears consequent upon, the above meeting, on 21 December 2007, Mr Ireland emailed Mr Demura, copying Mr Stevenson, with copies of the mining plan, together with a map of the proposed boundaries of the exploration area and the corresponding coordinates. [701] Mr Maitland was not copied into this email. Mr Ireland in his statement said the geological information available was very limited. He made various estimates, but ultimately, once clear boundaries of the area were defined, estimated the resource at 91 million tonnes of coal. He also said, "I have a vague memory of saying generally to the management group that all my work and calculations were only in the Whybrow seam and no geological data existed to consider the Redbank Seam". [702] This would tend to suggest a belief that the Whybrow seam would potentially yield 91 million tonnes of coal but that exploration may reveal more coal in the Redbank seam. Mr Ireland's "vague recollection" is, however, an insufficient basis on which to conclude that Mr Maitland was aware of this. 3. Mr Ireland's plan was reproduced in ResCo's application for consent. [703] The mine plan included a reference to a training panel. It is only in this plan that the size of the training mine is stated, with an area (clearly, in terms of its size on the plan, a very small portion of the overall area) marked as being for the training panel, with a figure underneath stating "150,000 tonnes". Mr Ireland in his statement suggested that the reference to 150,000 tonnes was for "training panel number one" and would be replaced with "panel number two" when exhausted. [704] Transcript of evidence given by Mr Ireland in earlier (different) proceedings confirmed this. [705] (I note that Mr Ireland was not called at the first trial.) Mr Poole also confirmed that this was his understanding. [706] Mr Maitland gave evidence to the same effect, although it was not entirely clear what he understood at the time. [707] The documentation suggested 150,000 tonnes, and it was only through Mr Ireland's explanations that it became apparent this was a starting figure. Certainly, as earlier stated in the case of Mr Macdonald there was no evidence that he understood this to be the starting figure, particularly having regard to the advice he received from the Department. Mr Maitland certainly understood that, whatever tonnage was indicated on the plan, the conditions on any approval would require DCM to maintain the training mine, which in turn may have required the establishment of further panels for the training mine. [708] While this much can be accepted, it is ultimately of little moment. Even if a new panel was established each year, over 10 years this would amount to 1.5 million tonnes, which was still a very small proportion of the total anticipated (in the event that any mining was feasible). The relative insignificance of the size of the training mine is also to be seen in the context of the anticipation that the coal produced by the training mine would pay for the training facility. In other words, given the coal from the training mine would fund the anticipated conditions on any mine, it was not much to give up in exchange for a commercial mine. 4. Mr Ireland subsequently wrote a letter dated 25 January 2008 commenting on the draft proposal. [709] In that letter he, amongst other comments, suggested changing the figures with respect to the size of the mine (referred to as 69, 66.9 and 67 million tonnes in the draft) to 91 million tonnes, which was reflected in the final document. This broadly is consistent with Mr Maitland's evidence with respect to his initial intention to use a figure of 62 million tonnes, but revising it based on Mr Ireland's advice. It is also inconsistent with any attempt to artificially deflate the potential value of the resource (albeit that was Mr Maitland's initial inclination). Comments on the draft proposal were also received by Mr Maitland from HVTC and the University of Newcastle. On 28 February, Mr Maitland emailed other parties concerned in finalising the draft and suggested deleting a sentence in a section under the heading "Project Funding" which read "Participation in the equity raising will be offered to HVTC and the University of Newcastle", and replacing it with a sentence stating that those organisations would be "stakeholders". [710] (The University, it appears, independently advised its position that it should not participate in equity raising.) The change was reflected in the final submission, which left the financial interest of the strategic partners unclear (noting that WRHS and HVTC had an expectation of deriving revenue from the mine). With respect to receipt of a financial benefit, the submission made reference only to the Community Trust Fund. [711] Otherwise, there was only a very vague reference to "benefits and synergies arising from the Training Mine concept to all alliance partners". [712] Without in any way suggesting any criticism of the organisations, had the financial incentives of WRHS and HVTC been known, there may have been reason to question the value of their letters. I do not mean to suggest that an additional source of funding for such institutions would not have resulted in a public benefit. Rather, the point is, the capacity for the conferral of this type of benefit was not unique to DCM. 5. The January 2008 draft of the Training Mine Facility Submission contained a description of Mr Maitland as having had "a long and extensive career working with, and influencing, Australian industry and politics" under the heading of "Director profiles". [713] This sentence was omitted in the copy that was ultimately submitted. Mr Maitland rejected the proposition that he had asked for it to be changed or that he was concerned that a reference to him having an extensive career working with and influencing Australian industry and politics would raise the same probity concerns raised by the Department. [714] Mr Maitland did accept that the other directors of ResCo saw him as someone who could "influence politics" which I understand to mean an ability to influence decision-making by persons such as Mr Macdonald. Indeed, it is no surprise that that is what he was trying to do. The issue is whether he broke the law in doing so. 15.5.6 The submission of 18 March 2008 1. As discussed above, the DCM submission was sent by letter dated 18 March 2008. [715] The submission has largely been dealt with in the context of Mr Macdonald's case. Some aspects of the drafting of the submission, particular to Mr Maitland, have been dealt with above. Some other parts of the submission warrant mention here, in deference to the issues raised by the parties. 2. Reference was made in the submission to "key partnerships" including an assertion that "Coal Services Pty Ltd will provide mine simulation, rescue and rehabilitation services". [716] Mr Maitland said that, at this point, he had approached Paul Healey (from Coal Services) about entering into a memorandum of understanding and Mr Healey had not given any indication that Coal Services was not going to be involved. [717] He did not agree that it was misleading to state that Coal Services would provide mine simulation, because they are a provider of mine simulation to the industry, and this was the case regardless of whether or not they wanted to be part of the project. [718] If this is accepted, the claimed involvement of Coal Services did not advantage DCM's proposal, contrary to the impression created by the document. 3. Mr Maitland accepted that the submission did not describe how people would apply to this program, how teachers would be identified, the staff to student ratios, the qualifications of the teachers, the curriculum, how they would locate tradespeople to be teachers, how many classrooms there would be, what facilities there would be in the classrooms and the proportion of time spent in the classroom as opposed to underground. [719] It is, however, not clear to me, that this detail could not be provided later, the assumption being that any training would necessarily be required to meet external accreditation standards. 4. The issue is not the actual quality of the submission, but how convincing Mr Maitland may have regarded it to be. It may, for example, have been misleading with respect to the involvement of Coal Services, but Mr Maitland would not necessarily have expected Mr Macdonald to know this. 15.6 Events following the lodging of the submission relevant only to Mr Maitland 1. Some evidence was led of events following the submission admissible only against Mr Maitland. 15.6.1 Letter to the Taiwan Power Corporation 1. On 2 May 2008, Mr Maitland, as chair of ResCo, wrote to Mr Chen, chair of the Taiwan Power Corporation, indicating that he understood the Taiwan Power Corporation was a large user of coal and anxious to ensure long-term security of supply. [720] Discussions were suggested with a view to the Taiwan Power Corporation exploring "investment and operational opportunities for coal and coalmines in Australia". The letter invited a meeting and stated "we are certain to have a project of interest for you by the end of next Month". Mr Maitland confirmed that the letter was directed towards the Doyles Creek mine. [721] It is not clear on what basis Mr Maitland could have been "certain" that by the end of June he would have a project of interest for Mr Chen. On its face, it supports the contention that Mr Maitland knew that consent would be granted, which, in turn, supports a contention it would be granted otherwise than on merit. Against this, Mr Maitland's expressed certainty was that the approval would be by the end of June, and was, therefore, misplaced, at least to that extent. Without understanding why Mr Maitland mistakenly believed the approval would be granted by the end of June, it is difficult to place significant weight on this. Further, Mr Maitland was not asked about it. No submissions were directed towards it. These matters significantly circumscribe the weight that can be given to the letter. 15.6.2 Media articles 1. On 23 May 2008, Mr Ian Kirkwood of Newcastle Herald published an article in relation to the application. [722] The article referred to the proposal as being for a "training mine" and quoted Mr Maitland as saying the project would cost about $200 million, but that "the consortium was not looking for taxpayers' money". In all, the article gives the impression that the proposal was not a profit-seeking venture, referring to Mr Maitland as saying, "any profits from the coal sold from the mine would be administered through a trust fund, with the usual royalties and taxes flowing to government authorities". This was, at least, misleading, given the article referred only to the training mine. There was nothing to alert the reader to the prospect of profits from any other component of the mine. Mr Maitland did not recall the conversation, but stated he would not have referred to a $200 million training mine, given the training mine component was estimated to cost in the order of $7 million. [723] It is not necessary, and indeed not possible, to determine precisely what Mr Maitland said to the journalist. The article is consistent with the general approach of inflating the significance of the training mine and downplaying, or omitting any reference to, the commercial aspect of the proposal. The article may have been effective in alleviating community concern (albeit on a false basis). Again, as previously stated, overstating the significance of the training mine may be the basis upon which Mr Maitland sought to "sell" the proposal. It might support an inference that Mr Maitland believed close scrutiny of the proposal would render it less attractive. It is, of course, a further step to infer that he understood that Mr Macdonald believed the project not to be in the interests of the State, and would be misconducting himself in the event that he approved the project. 2. On 6 June 2008 the Singleton Argus published an article titled "World first for Jerrys". [724] The article, again, referred to a "$200 million proposal" stating that details of the proposal were presented to a town meeting in Jerrys Plains on the previous Wednesday. The article notes that "while the training centre will undoubtedly be of a great benefit to Singleton and Hunter Valley, it does pose a problem for the Jerrys Plains community". It continues, "[i]n order for the training centre to be financially sustainable, ResCo will have to open and operate an underground mine near the Jerrys Plains village". This, together with the reporting of a question and answer session, suggest that, while the training facility may have been given prominence, the proposal for commercial mining was not hidden. In relation to the expression of opposition to mining close to the township, Mr Maitland was reported as saying "if it wasn't his company, it would be another". Mr Maitland was quoted as saying "if the community says they don't want the mine and fight against it, it probably won't happen", on the basis that his organisation did not want to be involved in a fight but stated "if we walk away from this, I can assure you that the State Government will put the exploration licence up for the highest bidder", [725] with the result that the community will, nevertheless, be stuck with a mine but not receive the benefit of the training facility. 3. Again, the report is consistent with Mr Maitland trying to "sell" his proposal. The report suggests an awareness of a tender process as a potential alternative for the allocation, and an awareness that the licences were valuable. While the Crown sought to make much of this, there is no suggestion that Mr Maitland was not aware from an early stage that a tender process was an alternative mode of allocation, and that companies may be willing to make what were described as "unrealistic" bids for the allocation. In this regard, the article does little more than reflect Mr Maitland's position – that the training mine was the basis on which he believed DCM could avoid having to bid against others for the consent. 15.6.3 The Department's Briefing Note of 13 May 2008 1. Between the publication of the above articles came the Department's (draft) briefing note of 13 May 2008. [726] That note, importantly, was only admitted against Mr Macdonald. Whatever Mr Maitland said about the proposal, or whatever "spin" was put on it, the Department and this note exposed, in a single sentence, the reality that, on the basis of the proposal of a total of 91 million tonnes DCM was hopeful of extracting, only 150,000 tonnes was to come from the training panel portion of the mine. This detail was only apparent on close inspection of the mine plan itself. Other negative observations in the note have been discussed above. However, unlike the 22 February 2007 briefing note, there is no evidence that this note was brought to Mr Maitland's attention. It is important to appreciate in the context of the case against Mr Maitland that, unlike Mr Macdonald, he was not made cognisant of the detailed objections of the Department. 2. While Mr Maitland was cross-examined as to deficiencies in the proposal it is not entirely clear how familiar he was with the detail of it at the time. It was not suggested that he had himself prepared the submission. Mr Maitland's evidence was he presumed it had been prepared by Mr Ireland, possibly with contributions from people within ResCo and in conjunction with communications with the Department. [727] Nonetheless, while Mr Maitland did not have a direct role in preparing the submission, he did not suggest that he was not familiar with it. To the extent that the Crown has exposed deficiencies in the proposal, this is objective evidence from which inferences may be drawn as to Mr Maitland's knowledge and intentions. 15.6.4 Seeking support and the approach to the NSW Minerals Council 1. In late June and early July, Mr Maitland was involved in email exchanges providing draft letters indicating support for the proposal to Mr Flannery of Felix Resources, Mr Peter Murray of United Collieries, and Mr Randall of Comet Coal and Coke. [728] Mr Gibson's details were provided to Mr Murray and Mr Randall with a request that the final letter be sent to him. As discussed in the context of Mr Macdonald, these letters were subsequently received and considered by him. I have, above, discussed the significance of Mr Maitland's role in the drafting of letters. 2. On 20 June 2008, Professor Glover of the University of Newcastle made notes of a meeting with "ResCo" (without identifying who was present). [729] Professor Glover's notes record "[m]inisterial approval likely in the short term – 2-3 months". Mr Maitland, in evidence, reaffirmed his understanding that ministerial approval was at that time likely in the short term "even though [he] knew that the DPI continued to oppose direct allocation" as the Minister's staff "had told me that he liked the project …". [730] This was essentially consistent with the evidence in the Crown case, for example, the evidence of Mr Coutts that Mr Macdonald was receptive to the proposal and his subsequent discussions with Mr Macdonald's office confirmed that Mr Macdonald wanted to see it progress. [731] The expectation was, nonetheless, premature given that no detail had then been provided to Mr Macdonald. Such confidence is at least suggestive of an expectation of a favourable determination otherwise than on merit. 3. A significant event around this time based on evidence not relevant to Mr Macdonald relates to Mr Maitland's efforts with respect to obtaining support from the NSW Minerals Council. On 23 July 2008, Mr Maitland emailed Mr Ransley reporting on a meeting he had held with Dr Williams and a Mr Atkins of the NSW Minerals Council. [732] He reported that Dr Williams "knew very little about the project". He said he had "the sanitised version of our presentation" and gave them a copy. He further reported that Dr Williams said "it seemed a good project but that the Minerals Council committee on training would have to give approval" before it could be supported. He said that he thought this was unlikely due to the number of interested parties with their own agendas, and that getting the Minerals Council to agree on anything is difficult. He thought that "at best" they would not be against it, but "even that's a risky business". 4. Dr Williams gave evidence of this meeting. [733] She said it was presented to her as a non-profit-making venture. Her evidence has been discussed above. Mr Maitland, in cross-examination, denied that the "sanitised" version was a version which presented the project as a non-profit-making venture. He said that the "sanitised" version left out the union involvement, as this would be unattractive to the NSW Minerals Council. [734] It is not clear what union "involvement" Mr Maitland was referring to. The CFMEU was not willing to support the project. While there were some letters from CFMEU officials supporting it, that falls short of actual "involvement" in the enterprise. Mr Maitland's own background could hardly be hidden. 5. Further, Mr Maitland said he could not have portrayed the project as a non-profit-making venture as Mr Buffier was a member (and Mr Maitland appears to have understood him to be the chair) of the Executive Committee of the NSW Minerals Council and, having provided a support letter, was well aware of the details of the proposal. [735] That letter was dated 26 June 2008 and thus predated Mr Maitland's meeting with Dr Williams. More significant than the letter was that Xstrata, of which Mr Buffier was the Chief Operating Officer at the relevant time, had been approached as a joint venture partner, and as a result can be expected to have been well aware of the profit-making nature of the enterprise. 6. It is not possible to reconcile the versions of Dr Williams and Mr Maitland. Dr Williams' evidence was given by tendering transcript while Mr Maitland gave his evidence before me. Even so, Dr Williams' evidence is consistent with what I find to be a general approach which involved emphasising the training mine aspect and minimising the commercial nature of the venture. Mr Maitland's explanation of the "sanitised version" lacks foundation. Further, while it is true that some members of the Council, in particular Mr Buffier may have been aware of the project in more detail, it is not clear that Mr Maitland, in approaching Dr Williams, knew that she would revert to her committee. Indeed, Mr Maitland's note to Mr Ransley suggests that he had not anticipated this, given the pessimism he expressed at getting any agreement on learning the matter would be considered by the committee. Having regard to these matters I prefer Dr Williams' evidence. However, as discussed above in connection with Mr Macdonald, while this approach and the conflict in the evidence does not reflect well on Mr Maitland, it is not probative of his intention that Mr Macdonald would misconduct himself. Of course, the failure to obtain the approval of the NSW Minerals Council impacted the strength of the submission. Mr Maitland would certainly have been aware of this, although it is less clear as to how he understood it would (or at least should) influence Mr Macdonald's decision-making. 15.6.5 The grant of consent to apply 1. The next major event was the grant of consent to apply on 21 August 2008. As discussed above, this was preceded by the meeting on 14 August 2008 between Mr Maitland, Mr Macdonald, Mr Gibson and Mr Munnings. As discussed above, the evidence establishes that Mr Maitland left this meeting with an expectation that DCM's application for consent to apply would be granted. While mentioned above, it bears repeating that 14 August was the date on which Mr Macdonald announced the successful Watermark bid. Mr Maitland acknowledged that he was aware of the Watermark announcement and, while not entirely unambiguous, appeared to accept that he was aware of it on the day it was announced. [736] This is also consistent with his general evidence as to keeping up with events in the industry. Whatever might be said about the differences between Watermark and Doyles Creek, this announcement can only have significantly reinforced the view previously expressed within ResCo and DCM that it was highly desirable (and probably determinative of their interest) that they avoid any competitive process with respect to the allocation they sought. 2. There is no evidence that Mr Maitland was aware of the process that then took place with respect to the drafting and ultimate signing of the letter of 21 August 2008. The most significant aspect of the grant of consent is in the evidence of Mr Maitland's understanding that DCM had been granted something of considerable value. This was a major plank in the Crown case against Mr Maitland. 15.7 Mr Maitland's attempts to sell a share of DCM based on the exploration licence and the Crown case that he believed he had been "gifted" something of significant value 15.7.1 Mr Maitland's emails placing a value on the exploration licence 1. It was the Crown's contention that Mr Maitland was aware he was being "gifted" something of very substantial value and that the conclusion that must inevitably follow is an awareness this was done as a favour by Mr Macdonald to Mr Maitland. The evidence relied on to prove Mr Maitland's belief that he had been gifted something of substantial value is sourced in a number of emails sent by Mr Maitland and the subsequent sale of shares by Mr Maitland, which resulted in a significant profit. It is convenient to deal with this issue at this point in the chronology relating to the case against Mr Maitland. 2. On 21 August 2008 (the date on which DCM received consent to apply), Mr Ransley forwarded an email to Mr Maitland containing what appeared to be a news headline from crikey.com.au that "'Macca' had granted a $300 million exploration licence to the state-owned Shehua (sic) group". [737] Mr Maitland said he could not recall discussing with Mr Ransley why Mr Ransley had forwarded that article to him, but denied that it was because they were acknowledging how lucky they were to have obtained the grant of the exploration licence for nothing, and the value of the gift that they had been given by Mr Macdonald. [738] It is likely, given its significance, that Mr Ransley was also aware of the Watermark announcement well before 21 August, and he would have known Mr Maitland was similarly aware. Although it was not attached, it seems to me more likely that Mr Maitland was being directed to the article itself, or at least the fact that it was the subject of a report by crikey.com.au. As I have observed above, however, the Watermark announcement on 14 August itself would have underscored to Mr Maitland the desirability of obtaining a direct allocation. Just how desirable it was, on the Crown case, was revealed in Mr Maitland's attempts to entice investors based on the grant of the consent to apply for an exploration licence (and later the exploration licence). 3. The role of Mr Tudehope was significant with respect to Mr Maitland's attempts to raise capital based on the grant of consent and representing it as a valuable asset. As outlined above, Mr Tudehope had met Mr Maitland sometime in the 1970s when both were working as miners in Queensland and involved in the union. They had remained friends. Mr Tudehope had lived and worked in China and had some contacts in industry there. He said Mr Maitland spoke to him about the Doyles Creek mine and that he was looking for investors. Mr Tudehope told Mr Maitland that he would set up a meeting with some potential investors and told him about a person called Edwin Chan (I note that he is referred to as Chan in Mr Tudehope's evidence but is also referred to as Edward Chen in some other parts of the evidence). [739] 4. On 24 August 2008, Mr Maitland sent an email to Mr Tudehope. [740] He advised Mr Tudehope that DCM had received an invitation to apply for an exploration licence, and stated that he had sent a proposal for the mine. (It is not clear what that document was.) The email indicated the "inferred in situ resources" suggested in excess of 100 million tonnes were recoverable, to be mined at 3 million tonnes per annum over 35 years. Mr Maitland advised that they were looking for investment and an offtake agreement. The email indicated: "The current shareholders are willing to negotiate on 20%. The estimated value of 20% of the project at this stage is gauged by estimated in situ reserves at current international prices prices(sic). Steaming coal coal (sic) is valued up to 50 cents per tonne and coking coal from two to three dollars per tonne. This would put an estimated value of somewhere about thirty million australian dollars, probably a little more." 1. I note that the value placed on the coal in the above passage relates to its unextracted value. Once mined and ready for sale, it was worth considerably more. The email indicated the expectation that the investor would contribute to expenses based on their percentage shareholding. 2. On 28 August 2008, Mr Maitland had a meeting with Mr Stevenson. Mr Stevenson's notes were tendered. [741] The notes record a discussion related to the sale of 10% of DCM to a company called China Steel. While the notes are somewhat cryptic, Mr Maitland agreed that they appear to suggest a sale of 10% for $15 million prior to the grant of any exploration licence, or $27 million after the grant of an exploration licence. If the first option were to be taken, and no exploration licence received, China Steel would retain its share and the company would continue to pursue its prospects in Queensland. This meeting was one week after DCM had been granted consent to apply. It is of note that the valuation increased substantially based on the granting of an exploration licence. This, and the reference to a contingency in the event that the licence was not granted, tends to suggest that, despite having been granted consent to apply (and the ordinary course that the grant of an exploration licence would follow), Mr Maitland did not regard it as inevitable that an exploration licence would be granted. Other evidence of DCM's willingness to pay an additional fee to Mr Maitland contingent on DCM's success in obtaining the exploration licence also supports this. [742] Mr Poole gave evidence that the $15 million and $27 million figures were inconsistent with what he assessed the value of the DCM proposal to have been prior to, and upon, the grant of the exploration licence respectively but accepted that Mr Maitland would have had the authority to make such representations in his negotiations with potential investors. [743] 3. On 25 September 2008, Mr Maitland wrote to Mr Tudehope, again, seeking to find investors. [744] The letter advised that he expected the licence to be granted in early December. On this occasion, Mr Maitland indicated that because the coal was soft and semi-soft coking coal he believed the "EV/resource level" of the project was approximately US$1.75 per tonne, with an estimated resource of 200 million tonnes. He noted that on these figures 20% equity would be worth approximately US$70 million. Again, this appears to be a formula based on the value of the coal prior to extraction. It was also noted there would be a contribution to expenses. The letter included the following proviso: "It is recognised that insufficient drilling has been done to verify the insitu (sic) reserves so we envision a process where 20% equity can be secured with an upfront payment of US$17.5 and the remaining payment of plus or minus US$52.5 made when the programme of exploration drilling has determined the total resource." 1. An email in similar terms was sent by Mr Maitland to the China Steel Corporation on 26 October 2008. [745] In that email Mr Maitland used an "EV/Resource value" of $US1.50 per tonne and a resource of 150 to 200 million tonnes putting a "minimum value of approximately US$240 [million] on the project at exploration stage", with the result that 20% would be valued at approximately US$48 million. A similar offer was made by which the 20% stake could be secured with the payment of US$15 million with the remaining price to be determined when the resource had been evaluated. 2. Based on the first email dated 24 August, a 20% share at $30 million would value the entire company at $150 million (presumably in US dollars). The second email dated 25 September put the figure at US$350 million and the third email dated 26 October at US$240 million. Based on the discussion with Mr Stevenson in relation to China Steel on 28 August, the company was valued at $150 million on the basis of the consent to apply and $270 million after the grant of the exploration licence (also presumably in US dollars). Mr Maitland confirmed that at that stage DCM had no assets other than the exploration licence. [746] 15.7.2 Mr Maitland's answer to the valuation emails – business "teasers" and other things 1. The fact that the project might ultimately fail based on the results of exploration did not mean the right to explore was not valuable. What, then, can be drawn from the evidence with respect to the value of the consent to apply, and the exploration licence – principally, the emails sent to prospective investors in China? 2. Mr Maitland described these letters as "teasers", in effect an opening communication to try and attract interest. [747] Mr Poole gave similar evidence stating, "a teaser is not a lie", but rather "is simply telling the best story you can about, what you have and in this particular case … that is certainly what we were relying on". [748] It is difficult to imagine that anyone would commit millions of dollars based on a single page letter or email devoid of anything to substantiate the claims being made. In that sense they were clearly in the nature of an opening gambit. The wide variation in values between the three letters would suggest Mr Maitland had no real confidence in the figures. On the other hand, if one were to take the 91 million tonnes estimated in the proposal, and one of the lower figures Mr Maitland used for calculating the value of unextracted coal, the project would still have a very significant value. 3. Mr Poole was also taken to the China Steel email of 26 October 2008 in cross-examination on behalf of Mr Macdonald. [749] Mr Poole explained that what was being offered was a share of the company which would (obviously) reduce the proportion of the company held by the other shareholders. The purpose of such a process is to raise money in order to allow the company to realise its objectives. Mr Poole confirmed that the money goes to the company and not to the existing shareholders, the point of the cross-examination being that the injection of capital does not bear upon the value of the existing shares. As was pointed out in further cross-examination by the Crown, this is qualified by the fact that the shares of the other shareholders would, after the injection of capital, increase in value as the company would then have a significant cash asset resulting from that event. [750] These matters are, however, somewhat beside the point. The point, as I understand it, is that the attempt to sell 20% of the company for $48 million required the seller (DCM) to convince the purchaser (China Steel) that it was value for their money. In other words, the letter, and the other communications seeking to raise equity, are evidence of a belief that DCM owned a saleable asset of value. 4. Mr Maitland, in cross-examination, also took pains to stress that the figures were based on an "inferred" resource. [751] At one stage Mr Maitland suggested the value he placed on the share of DCM was contingent on the resource being established. [752] This was, plainly, not what was being offered. There was no doubt that there was some uncertainty as to what could be recovered from the area. The whole process was, of course, predicated on there being a prospect of recovering coal. The coal price was, in the proposal, forecast at approximately US$125 per tonne in 2008 and to remain at or above US$100 for semi soft coking coal. [753] (There was also evidence from Mr Lewis whose recollection of the coal price in May 2009 was AUS$90 to $100 per tonne, [754] however, the figure in the proposal was presumably a considered figure and given proximate to events. Either figure demonstrates the point.) The extremes for any potential investor were, at one end, a loss of the entire investment, and at the other end, a return very significantly greater than the amount invested. Mr Maitland ultimately agreed that inherent in the $30 million figure for 20% of the company (and inferentially in each of the other proposed figures) was a discount to allow for that uncertainty. [755] He said that the grant of an exploration licence commences a process which provides "an opportunity for a very substantial return on investment for people who are prepared to take the risk". [756] 5. Mr Maitland sought at times to avoid the reality that the grant of consent to apply (and any subsequent exploration licence) was of value. It was not accurate to characterise, as Mr Maitland sought to do, the exploration licence as merely a liability or a licence to spend money. [757] The fact that it may have turned out to be worth nothing after exploration was not the point. That was simply a reflection of the risk. An opportunity to bet $1 with a 50% chance of winning $10 has value. There is, of course, a 50% chance the investment will be worthless. Equally, there is a chance that $1 will become $10 (a gain of $9), giving the $1 investment a value of $4.50. The value here is somewhat less certain, although the evidence given by both Mr Lewis and Mr Poole was that they rated it as in the order of a 50/50 proposition. If the potential loss could be borne, on my assessment, those odds would have made the enterprise an attractive proposition. 15.7.3 The value of Mr Maitland's shareholdings in DCM and opportunities to obtain additional shares 1. There is no evidence that Mr Maitland was provided with an expert valuation of the consent to apply or the exploration licence. The value of the exploration licence was, at a later stage, potentially reflected in the value of Mr Maitland's shareholding in DCM. The details of Mr Maitland's shareholdings are contained in agreed facts. [758] Mr Maitland obtained a 5% shareholding in ResCo in January 2007 as part of the arrangements involved in him accepting his role on the company board. It is not clear whether these shares were ever converted into shares in DCM. Mr Maitland did, however, acquire shares in DCM. Between June 2007 and June 2008, through a family company he essentially controlled, he acquired 165,623 shares in DCM, at one dollar per share. [759] As at August 2008, Mr Maitland held 17% of the shares in DCM. (Mr Maitland's evidence at one stage at least implied the 17% included the initial 5% of ResCo.) [760] Mr Maitland used his superannuation to fund the purchase of the additional shares. That superannuation payout was in the order of $550,000. [761] 2. In November 2009, DCM agreed to a transaction with a public company, not then trading, which became NuCoal Pty Limited (NuCoal). The shareholders of DCM exchanged their shares for approximately 84% of the shares in NuCoal on a pro rata basis, with the remaining NuCoal shares to be acquired by other investors. This gave Mr Maitland about 14.3% of the shares in NuCoal. The prospectus lodged by NuCoal with respect to this transaction listed the key asset as the exploration licence. Also referred to was approximately $1.6 million in cash assets, and land, valued at $1.7 million, but subject to a mortgage. Between February and December 2010, Mr Maitland's private company sold slightly over one third of its shares for in excess of $6 million. [762] On this basis the value of Mr Maitland's 14.3% share of NuCoal was in the order of $18 million, and the total value of NuCoal approximately $125 million. Of course, it cannot be assumed that a buyer would necessarily be available at that price. Further, NuCoal had presumably, by that time, added to its capital through the sale of the additional shares resulting from the transaction with DCM. While the precise figures are uncertain, the numbers are of sufficient magnitude that it can safely be concluded that the exploration licence held by NuCoal, at least at the time Mr Maitland was selling the shares referred to above, was of significant value. 3. As noted above, at the time of the NuCoal transaction no additional drilling had been done. Mr Lewis said that by August or September 2009 some further work had been done, "predominantly what is called desktop studies and reviewing mining options" but that no drilling had yet been done. [763] Mr Poole said when he sold his shares at the end of 2009, drilling had not yet occurred and Mr Lewis said as at late 2009, DCM had only drilled one additional hole. [764] Certainly, in late 2009 there were endeavours to raise capital to finance exploration. [765] There is, however, a paucity of evidence as to what happened in terms of exploration between the acquisition of DCM by NuCoal in November 2009 and Mr Maitland's share sales in 2010. That is, it remains unclear as to what more was done between "late" 2009 and February 2010 (or perhaps later given there is no evidence as to the price at which different parcels of shares were sold during the period between February and December 2010). Mr Maitland did not suggest successful exploration as an explanation for the value of the shares when sold, however, it is difficult to place weight on this as he was not pressed on the issue. While presumably the value was negatively impacted by the conditions on the licence (or the anticipated conditions in the case of the consent), that does not change the underlying fact that the licence was, on the basis of the price obtained for the shares, of considerable value.. 4. In addition to some uncertainty as to what had occurred by the time Mr Maitland realised a significant profit from the sale of shares in 2010, it is additionally, and perhaps more significantly, not clear at what point he became aware of the prospect that his shares were worth many times his investment. In his evidence, with respect to the sale of shares, Mr Maitland said "I was rewarded for what I did in the company, and actually beyond my belief, beyond my expectation or dream". [766] 5. It is true that from an early stage, Mr Maitland was aware of the potential for rival bids in a competitive tender, and thus that the grant of consent might be regarded as valuable. It is necessary however to focus more closely on what was happening around the time of the grant of consent. It is clear on the evidence that Mr Maitland did not, at the relevant time, regard significant profit as a certainty. On 28 July 2008, he, through his private company, declined an offer to acquire a further 64,838 one dollar shares in DCM. (Whilst not explicitly stated I understand the offer was to purchase the shares at $1 per share.) This occurred less than one month prior to the grant of consent to apply, but as the evidence shows, at a point at which he had some confidence it would be granted. Had Mr Maitland been confident in the outcome of the mine, or even confident as to the value of an exploration licence, it might be thought he would have purchased these shares. As noted above he had received in the order of $500,000 in superannuation, of which approximately $165,000 had been expended for his shareholding in DCM. It is not known what other expenses he may have had and consequently what part of his payout remained available to him (or indeed what other liquid assets he had). Nonetheless, I am inclined to think that had he been confident, he would have likely been able to find the money, or at the very least, put someone close to him into the deal. There is no evidence that he did so. 6. Subsequent to the grant of consent to apply, but only around one month later, on around 29 September 2008, Mr Maitland's private company forfeited the right to obtain 112,519 $1 shares in DCM. [767] Those shares had been applied for but the purchase price not paid. Again, while Mr Maitland's financial circumstances were not made clear, it might have been thought that had he been confident that the shares would be worth significantly more than their issue price, he would have found the necessary funds. 7. Mr Maitland's decision not to purchase additional shares shortly prior to the grant of consent to apply might have suggested that he was not confident that the consent would be granted, as opposed to saying anything about the value he put on a grant of consent to apply. However, the fact he made a similar decision shortly after tends to neutralise that contention. Other evidence, in any event, suggests that by at least July 2008 he was confident of obtaining the consent. The decision to decline shares shortly prior to the grant of consent does not impact my view with respect to Mr Maitland's expectation of being granted consent to apply prior to its occurrence on 21 August 2008. 8. The result is, on two occasions, at which times he was either expecting to receive consent to apply, or it having been granted, Mr Maitland declined the purchase of further shares. The conclusion I draw is that he was unwilling to risk further funds. It may well have been the case that the grant of consent and the exploration licence had value and were known by Mr Maitland to have value. As discussed above this is not inconsistent with the reality that the project could ultimately come to nought. Depending on his financial resources, Mr Maitland's willingness to gamble may have been limited. (To return to the example above, the $1 bet would be more attractive to someone who had the capacity to lose the dollar than someone who did not.) Mr Maitland's sale of approximately one third of his shares in 2010 (assuming there was no significant exploration) would appear to have been a hedge against the prospect that exploration was unsuccessful. That is a sale based on an assured value of some shares, while effectively speculating on the remainder, in effect limiting the gamble. The situation with respect to declining shares around the time of the acquisition of the consent to apply and the exploration licence is somewhat different. On the Crown case, there was no gamble involved at all. The Crown's submission was that the exploration licence was, in and of itself, a very significant asset and known to Mr Maitland to be so. If Mr Maitland was clearly of that view at the time, it is then surprising that he did not go "all in" and take up every share available to him. 9. It will be recalled that the foundation for the project was the opinion of the geologist Dr Palese. Dr Palese's presentation in January 2007 was based on the area having essentially been overlooked due to perceived difficulties in mining the area. While Mr Maitland described Dr Palese as something of a "prophet" with respect to finding areas where other mining companies had not thought there was significant resources", [768] there was clearly a limit to the extent that Mr Maitland and DCM were prepared to back Dr Palese's prediction. That DCM had resolved to abandon the project in the event a direct allocation was not obtained tends to suggest that, while the collective view was positive, it was not so positive that they were prepared to attempt to outbid others. In short, a profitable mine was no certainty in the minds of Mr Maitland and his fellow directors. Relatedly, it may also have been thought that convincing outsiders of Dr Palese's "prediction" would be difficult. It would follow then that there might be some limitation on Mr Maitland's confidence in the value of an exploration licence with respect to that area. 15.7.4 Mr Maitland's knowledge of the Department's recommendations and the potential AFC forgone 1. Mr Maitland also knew that Mr Macdonald had been advised by the Department to put the area out for competitive tender. He knew that other areas had been subject to AFCs and that Mr Macdonald would be aware of that fact. It follows that Mr Maitland was aware that Mr Macdonald knew that an AFC would likely be obtained if the area was subject to a competitive allocation rather than a direct allocation to DCM. Of course, DCM sought to justify the allocation based on particular features of its application, and in particular the establishment of a training mine. Mr Maitland's knowledge that Mr Macdonald was aware that an AFC, and possibly a substantial AFC, could be obtained through a competitive tender is a matter to be considered in the context of all the evidence in determining whether Mr Maitland intended that Mr Macdonald would misconduct himself in granting consent to DCM. 15.7.5 Conclusion as to Mr Maitland's belief he had been gifted something of value 1. Mr Maitland certainly regarded the project as being of value. As discussed above, his involvement, and that of the other members of DCM, was predicated on this. He knew that the Department in February 2007 had recommended a competitive tender as it was likely there were other interested parties. The Watermark announcement on 14 August 2008, coinciding with Mr Maitland's meeting with Mr Macdonald which confirmed Mr Maitland's belief that the consent was soon to be granted, must have brought home to him the fact that a benefit had been obtained through avoiding the tendering process. Watermark was of course very different. Consequently, none of this establishes what the extent of that benefit might be. 2. Mr Maitland sought to place a value on the project in the emails discussed above. It is not clear that those values reflected his own view. Indeed, they could not have, given the variation in the valuation. There is no evidence he was confident that this could be realised. There was little to distinguish the emails from other emails commonly then received offering great wealth other than they were perhaps more upfront about the initial investment. Of course, it may have been hoped that the credibility of the emails would be boosted by Mr Tudehope's recommendation. But the reality was there was very little in the emails to convince anyone that there might be value in parting with millions of dollars. 3. There was some evidence of negotiations following the "teaser" emails which support their characterisation as an introductory gambit. On 7 November 2008, Mr Maitland again emailed Mr Tudehope. [769] On this occasion he referred to telephone discussions about a meeting with Mr Li of the Shougang group on 1 November 2008. It is not clear, but it appears that Mr Maitland had telephone discussions with Mr Tudehope who had met Mr Li. The email refers to a meeting in Beijing in September in which a figure of US$70 million was placed on 20% of DCM (and essentially repeated the figures in the 25 September 2008 email). The letter, like that of 25 September, indicated that it is "recognised that insufficient drilling has been done to verify the indicated reserves or to guarantee the quality so the US$70 million is negotiable", and suggested an upfront payment of half the amount agreed by negotiation to secure 10%, with the remainder secured after exploration drilling allowed a determination of the quantity and quality of the coal. [770] In addition, it was indicated that shareholders would be required to contribute their share towards the drilling program, estimated to cost US$4.5 million and to commence in the first quarter of 2009. 4. An email of 26 February 2009 from "Edwin" whom I take to be Edwin Chan, reports on what he was told by "Mr Li of CSH". The email states that Mr Li reported a meeting with "the Australians", which Mr Li did not attend, in which it was indicated the "mine will be over USD200-250 million, which is totally unacceptable". [771] Mr Li refers to the inadequacy of the geological work and drillhole data, the quality of the coal and the development time. Mr Li suggests that at a valuation between US$50 and US$75 million (as a total), his company may be sufficiently interested to send its experts to further investigate the project. (The reference to a meeting in September and these follow-up communications cast some doubt on Mr Poole's evidence that travel to China in an attempt to attract Chinese investors resulted in nothing more than them being told to "go home".) [772] This negotiation supports Mr Maitland's characterisations of the emails as "teasers", although, on any view, the values discussed were very large. 5. Having regard to the above, it is difficult to determine the weight to be given on the emails. It is difficult, then, to come to any precise view of what Mr Maitland regarded the consent to apply to be worth. It is likely that he himself had no clear idea. Perhaps the most significant evidence is Mr Maitland's decision not to acquire further shares when he had the opportunity around the time of the grant of consent to apply. Had it been expected that another company would have jumped at the opportunity to obtain the consent, and paid handsomely for it, it would have been, in theory (that is, subject to scrutiny it would have attracted), open to DCM to obtain the consent and then sell the company for the value of the consent, or later, the exploration licence. Even if immediate sale was not practicable, had this been the expectation it is likely that Mr Maitland would have found a way to take up the shares. I am, in the result, of the view that while Mr Maitland certainly believed the direct allocation was a benefit to DCM and to himself, I cannot ascribe to it a value based on his knowledge of bids for other resources such as Watermark, his "teaser" emails, or the price later obtained for a portion of his shares. Ultimately, I am unable to achieve any clarity beyond this. 15.8 Obtaining evidence of support to fulfil the conditions on the grant of consent 1. While the conduct of Mr Maitland relied upon in relation to count 2 was complete by 21 August 2008, it is convenient to consider the events based on evidence as admitted against and relevant to Mr Maitland following the grant of consent, before returning to consider whether count 2 has been proved. With respect to events following the grant of consent, it will be recalled that the grant was conditional on obtaining evidence of community and industry support. 15.8.1 Obtaining community support 1. On 26 August 2008, Mr Maitland attended a meeting, together with Mr Ransley, Mr Poole, representatives from WRHS, HVTC and members of the Jerrys Plains community. A representative of the University of Newcastle was to have been in attendance but was absent due to illness. Minutes of the meeting were tendered, [773] which Mr Maitland accepted as accurate. [774] Mr Maitland advised the meeting that Mr Macdonald had given DCM consent to apply for an exploration licence. He indicated his hope that this would be advertised over the next three to four weeks, and that there were 28 days for objections. He told the meeting that if DCM did not take on the area "someone else will, now that the area has been identified as bearing coal". (Nothing new had, in fact, happened in this regard.) The minutes indicate that Mr Ransley said he felt that the Minister was supportive of DCM's proposal. He indicated that DCM was willing to accept conditions assisting the community as part of the agreement with the government and that the "whole process is based on community support and approval leading to a binding agreement". Mr Poole told the meeting there needed to be a commitment to the entire process and that the "mine has to be commercial". He said a member of the community could be on the Board. Mr Alcock of WRHS and Mr Morris of the HVTC spoke about the benefits to their organisations. 2. On 23 September 2008, Mr Maitland emailed Mr Combet with a "Fact Sheet" on the project together with a draft letter addressed to Mr Macdonald, supporting the proposal, which he asked Mr Combet to consider. [775] Mr Combet was the Federal member for Charlton, and as I understand it, represented a community at least in the general vicinity of the proposed mine. The Fact Sheet indicated that DCM was seeking an exploration licence, that they were in "advanced discussions" with a number of community partners in relation to the establishment and operation of a training facility, to be separate from the commercial mine. It referred to the University of Newcastle, HVTC and the WRHS as community partners, and further indicated that it was proposed that "a portion of the profits from the mine will be distributed to the Jerrys Plains and wider community via a trust". [776] 3. On the same day, 23 September, Mr Maitland emailed Vicki and Paul Nichols, the latter of whom was the president of the Jerrys Plains Mine Watch Committee with a draft of a letter addressed to Mr Macdonald indicating that the Committee had agreed to negotiate a memorandum of understanding with DCM based on which the community would be in a "position to support the establishment of the Training Facility and Mine at suitable venues in our area". [777] Mr Nichols subsequently amended this draft to read that the committee would, when the agreement was finalised, be "in a position to consider our support for the establishment of the Training Facility and Mine at suitable venues in our area" (emphasis added), [778] before sending it directly to Mr Macdonald's office on 7 October. 4. There is no doubt that at the community meeting, Mr Maitland, Mr Ransley and Mr Poole were endeavouring to make their proposal attractive to the community. Mr Maitland appeared honest in his evidence that the community generally "were very welcoming" in the sense of being hospitable, but quite suspicious about any industry project that was going to be near their village". [779] I would not conclude that Mr Maitland and his fellow directors were not genuine in their attempt to engage the community at this meeting, although the position put to the meeting appears to have somewhat misrepresented matters. Similarly, with respect to the attempt to obtain written agreement with the community committee and with respect to the letter from Mr Combet (and the obtaining of letters from various other persons included in the application). With respect to Mr Combet's letter, it might be noted that the draft was amended to make clear that the training facility would be of value "in the event that" the mine was approved. It appears Mr Combet was careful not to suggest that the mine should be approved for the purpose of establishing a training facility. 15.8.2 Obtaining evidence of industry support 1. In an attempt to satisfy the condition to demonstrate broader industry support, the application included letters, which have been discussed in the context of Mr Macdonald. 15.8.3 Conclusion in relation to satisfaction of the conditions on the grant of consent 1. The Crown submitted that the letters were deficient in addressing the requirement in the letter of consent to provide indication of industry and wider community support for DCM's proposal, and that Mr Maitland must have therefore known that the requirement for such indication was not genuine. 2. Mr Combet's care in editing the draft to clarify he was not supporting the establishment of the mine, but rather, the value of training in the event that it was established, highlights the shortcoming of letters from other participants as previously discussed. That is, that no one would deny the provision of training facilities was a good thing, particularly if there was perceived to be a skills shortage. 3. While Mr Combet, Mr Hickey and Mr Coombs represented their electorates, arguably the most significant representative body with respect to the local community was the Jerrys Plains Community Mine Watch Committee. (Without intending any disrespect, I note here that it is difficult to see that any real weight could be given to letters such as those from the solicitors acting for DCM.) As noted above, Mr Nichols, as President, provided a letter that fell well short of unqualified support. While there is no evidence Mr Maitland received Mr Nichols' very guarded letter, even if he had not, it must have been apparent to him that DCM had not received the support he had sought. 4. With respect to industry, Mr Maitland accepted there were more than a dozen individual coal producers in the Hunter Valley and elsewhere in New South Wales. [780] Further, while the application included letters from Xstrata, Donaldson Coal, Felix Resources, United Collieries and Hydromining, these had all been provided prior to the granting of consent and did not demonstrate any support additional to that demonstrated in the original application (despite Mr Maitland's evidence to the contrary). [781] 5. I would accept that Mr Maitland, through his engagement in community consultation, appeared to be taking the condition on the grant of consent to apply, to demonstrate community support for the proposal, seriously. I would also accept Mr Maitland's evidence that, although they engaged in significant debates in the beginning, the outcome may have been that if there was to be a mining operation, the community preferred DCM. [782] But that is not the same thing as support for the proposal as the Jerrys Plains Mine Watch Committee's response demonstrates. Subject to the representativeness of that committee (which did not necessarily support the mine), the process was inadequate as a means of obtaining an objective understanding of community and industry support. That the process was not rigorous does not necessarily mean that Mr Maitland was aware that Mr Macdonald was engaging in misconduct and intended that he do so. It is a matter that may, and perhaps should have, caused Mr Maitland to be suspicious. It is certainly a process that can be questioned in hindsight. While less convincing, it is also consistent with Mr Maitland believing that Mr Macdonald had a genuine belief as to the benefits of a training mine and required very little more to justify his decision. This matter falls to be considered with the other evidence. 15.9 The application for and granting of the exploration licence 1. The next major event in the chronology was the lodging of the application for the exploration licence on 29 September 2008. This has been discussed above. As there noted, the application was accompanied by the various letters of support "as requested by the Minister". 2. The events which followed, up to and including, the grant of the exploration licence have largely been dealt with above in relation to Mr Macdonald. One part of the evidence particular to Mr Maitland, is an email from Mr Maitland to Mr Ransley on 11 December 2008 in relation to a letter from the Department addressed to Mr Lewis, apparently handed to Mr Poole the previous day. [783] The letter indicated that the Department had registered the application, and advised that notice of the application must be advertised, and included details with respect to the requirements. The letter indicated that "no exploration licence will be granted until satisfactory copies of advertisements are lodged with the Department". Mr Ransley emailed Mr Maitland, Mr Barnes, Mr Poole and copied Mr Lewis, advising that Mr Lewis was handling the issue and would not be contacting the Department "until after the deed is signed on Monday [15 December] as it may cause a commotion in the DPI ranks re timing". [784] The email then raised issues with respect to the payment for the security deposit. Mr Maitland responded, "I agree the least we do until we sign up the better". [785] The general tenor of the emails confirms Mr Maitland's understanding, and that of Mr Ransley, that the Department was not supportive of their proposal. In fact, he acknowledged in his evidence that he was aware that the DPI was always opposed to a direct allocation to DCM, including at this stage. [786] It is not, however, clear as to what the issue was with timing specifically, particularly given relevant documentation was being prepared by the Department. It may have been a reference to the exploration licence being granted prior to the lodging of copies of advertisements but this is not explicit. Ultimately, it is not clear from Mr Maitland's response that he had read the detail of the Department's letter (including the advertising requirement) as opposed to simply agreeing with the general strategy of leaving well enough alone. The response does, however, at least sustain the inference that Mr Maitland had a clear appreciation that Mr Macdonald's actions in supporting the proposal were at odds, and had remained at odds, with the view of the Department. 3. There is little further evidence of direct relevance to Mr Maitland. An email from Mr Maitland to Mr Lewis, copying Mr Ransley, Mr Poole and Mr Barnes on 12 August 2009 demonstrates that work had been put in to establish the Doyles Creek Trust, and to that end there had been monthly meetings with the University of Newcastle, HVTC and the WRHS. [787] The email stresses the need to finalise the establishment of the trust in the light of political murmurings with the potential for this to cause Mr Macdonald to be replaced as Minister. Mr Maitland states that it would be "best for us if [Mr] Macdonald remained the Minister" given his support for the project and that "a new Minister may want to review all parts of the [project] especially those that have received media coverage of late". It is clear that Mr Maitland believed that a review may have negative results. This, however, is not altogether surprising given his awareness that the proposal had consistently been opposed by the Department, and the grant of the exploration licence had, by this time, attracted negative publicity. The evidence is consistent with earlier evidence but does not, in any material way, add to it. 15.10 Conclusion in relation to count 2 against Mr Maitland 1. There is no doubt that Mr Maitland was instrumental in encouraging Mr Macdonald to grant the consent to apply. He did not dispute this, and indeed stressed, that his obligations, as a director, required him to act in the best interests of the corporation, which, in this instance, required him to pursue the application. Further, as noted above, Mr Maitland did accept that the other directors of ResCo saw him as someone who could influence decisions such as those required of Mr Macdonald. Indeed, it is no surprise that Mr Maitland was, in fact, trying to influence Mr Macdonald. The following questions and answers are of interest: [788] "Q. That was how you represented yourself to ResCo, wasn't it, that you were someone who could influence politics? A. I think they thought that. That was one of the reasons they approached me. And, you know, my record shows that both sides of politics had invited me to be - to participate in processes which may very well help. … Q. You had a capacity to influence politics? A. Well, I would hope so. Q. And that's what you were doing in this instance. You were influencing the minister in the exercise of his discretion? A. Well. Q. Seeking to do that? A. Well, the submission is seeking to influence the minister. I mean, that's what the submission is about. We are trying to - we are trying to get a direct allocation. We can't get a direct allocation if we can't influence the minister. I mean, that's the logic." 1. Trite as the above evidence is, it highlights an issue at the core of the case against Mr Maitland. It was entirely open to him, and indeed expected of him, to do everything lawfully within his power to seek to influence Mr Macdonald to make a decision favourable to himself and DCM. The qualification, "lawfully within his power", of course means that he could not seek to influence Mr Macdonald through a bribe, or by conspiring with him or otherwise engaging in some form of pre-concert with him. Here, the Crown alleged a form of agreement (without expressly describing it as such) based on the "strategy" derived at the Prime Restaurant. I have, above, analysed the evidence in this regard and am unable to find a strategy of the nature alleged by the Crown was formed between the accused at or around the time of the Prime Restaurant lunch. This is not fatal to the Crown case, but it does bring its proof into focus. 2. There is no issue that Mr Maitland actively encouraged Mr Macdonald to grant the consent and the exploration licence. What must be proved by the Crown is that Mr Maitland, in doing so, knew that Mr Macdonald was engaging in misconduct and intended that he do so. This, then, begs the question, at what point in the process of lawful persuasion does the inference arise that Mr Maitland must have been aware that any approval granted by Mr Macdonald in response to the proposal must have been driven by a motivation to favour Mr Maitland, such that the same decision would not otherwise have been made? The Crown's answer to this question is that Mr Maitland must have known that the approvals of the application for consent to apply, and the subsequent exploration licence, were "too good to be honest" despite his genuine and long-standing belief in the benefits of a training mine. Care is required before accepting such an argument. Apart from anything else, it is a natural human tendency to believe what we want to believe, and to be stubborn in shifting from any such belief. False pretenders know this only too well. What evidence is there, then, to exclude the possibility that Mr Maitland's belief in the merits of his proposal, and his powers of persuasion, diverted him from the realisation that the only way Mr Macdonald could approve his proposal would be if Mr Macdonald was driven by a desire to favour him? 3. It is plain that the Department opposed the proposal throughout the entire process. Mr Maitland was aware of this and acknowledged it in his evidence. [789] He was also aware of the contents of the Department's briefing note of 22 February 2007 which raised a number of particular issues. It is also the case that in excess of a year had passed between that briefing note and DCM's application in March 2008 (and a further period prior to the grant of consent to apply in August 2008). During that time Mr Maitland sought to address issues that had been raised in the briefing note. The proposal submitted in March 2008 was very much more substantial than the 15 February 2007 submission. While the Department remained opposed, there is no evidence that Mr Maitland had access to the Department's briefing notes provided to Mr Macdonald subsequent to the March application. Mr Maitland had long believed in the merits of an underground training mine. He also believed that the proposal addressed what had in the past been seen as a major, if not insurmountable, stumbling block to establishing such a mine – that is, its funding. 4. Mr Maitland was, no doubt, aware that the decision by Mr Macdonald contrary to the advice of his Department was favourable to him. But he was also aware that it was entirely within Mr Macdonald's power to exercise his discretion contrary to the Department's advice. Insofar as there was a difference between the Department and Mr Maitland it was, to some extent, a philosophical one. That is, putting to one side the details of the proposal, it was entirely reasonable that Mr Macdonald might prefer Mr Maitland's philosophical position to that of the Department. The Department's opposition to the March 2008 proposal was, of course, based on the detail of the proposal. The question becomes whether that detail, rather than simply the Department's opposition, was such that I can infer that Mr Maitland intended that Mr Macdonald would engage in misconduct. 5. The case against Mr Maitland is, to a large extent, as I have indicated above based on the submission that the approval was "too good to be honest". In part, this was based on a contention that he must have known that the resource could have been put to competitive tender with a requirement to establish an underground training mine. As a matter of objective fact, it is true that such a process could be undertaken. However, a good deal of effort had gone into establishing relationships with the HVTC, WRHS and the University. Mr Maitland's involvement and his relationship with Mr Macdonald, which was, at the least, a friendly working relationship, gave him reason to think that Mr Macdonald would trust the genuineness of any training mine set up under Mr Maitland's watch. I am inclined to think it is at least possible that Mr Maitland regarded DCM's proposal as unique or otherwise did not turn his mind as to whether a competitor, even if willing to establish a training mine, could offer the same confidence as to its commitment to such a facility. 6. Mr Maitland's awareness of the scarcity of resources in the Hunter Valley, the booming coal market, and the competitive processes that had resulted in significant bids with respect to other areas meant that he understood that direct allocation was a significant benefit to DCM. This understanding was also reflected in his attempts to attract investors. However, as I have found above, it is difficult to know what he understood the value to be. More particularly, it is difficult to know what he believed Mr Macdonald would have understood the value to be. 7. It is clear to me that while Mr Maitland was committed to the idea of a training mine, DCM, and derivatively Mr Maitland, employed the promise of the training mine as a selling point, or in the blunt terms used within DCM, "spin", to obtain a direct allocation of a commercially valuable resource. It is, however, less clear that Mr Maitland believed that Mr Macdonald had not been genuinely taken in by the "spin". Mr Macdonald was both generally in favour of mining and concerned with health and safety, matters that were, no doubt, known to Mr Maitland. While there is evidence that Mr Maitland sought to play down the commercial part of the mine to persons such as Dr Williams and to the journalist Mr Kirkwood of Newcastle Herald, [790] he may have done so on the basis that these individuals were, for different reasons, unlikely to be sympathetic to the proposal. 8. Nonetheless, it remains the case that Mr Maitland received something he knew to be a significant benefit. At the time the consent to apply was granted, Mr Maitland knew that the support of the NSW Minerals Council had not been, and was not going to be, obtained. Unlike the case with respect to Mr Macdonald his awareness of other investigations or processes that might have taken place is not clear. There is room for suspicion and perhaps grave suspicion. But what ultimately is required is an analysis of the inferences able to be drawn from the objective evidence, the strength of those inferences, together with the evidence relied on by Mr Maitland, including his own, seeking to rebut those inferences. Ultimately, as I have discussed above, a significant attenuating force on the strength of adverse inferences available against Mr Maitland is that unlike Mr Macdonald, the decision was not his responsibility. The result is it is more difficult to conclude that matters that could have and perhaps should have occurred to him, necessarily did occur to him. As troubling and unconvincing as the process of obtaining letters of support in place of independent investigation for the allocation of a potentially valuable resource may be, I am unable to exclude the possibility that Mr Maitland unquestioningly accepted the process the Minister put in place. 9. I am left with a reasonable doubt that Mr Maitland intended that Mr Macdonald's driving force in granting DCM consent to apply for an exploration licence would be to favour Mr Maitland and DCM, such that the decision would not have been made but for this purpose. I am therefore not satisfied beyond reasonable doubt that Mr Maitland intended that Mr Macdonald would misconduct himself in granting DCM consent to apply for an exploration licence on or about 21 August 2008. It follows that Mr Maitland must be acquitted with respect to count 2 on the indictment. 15.11 Conclusion with respect to count 4 against Mr Maitland 1. The fact that I am not satisfied in relation to count 2 does not produce any automatic result in relation to count 4. It is necessary to have regard to the evidence of events subsequent to the grant of consent, including that grant of consent in the present case was unusual in that it imposed conditions. It is not clear, however, whether Mr Maitland understood this to be unusual. As I have indicated above, I accept that he made a genuine effort to meet those conditions. The evidence of industry support lodged with the application did not meaningfully add to the material in the application for consent. If anything, the consent letter noted that the NSW Minerals Council would soon advise its position, and Mr Maitland was aware that the Council had resolved not to support the proposal. As I have earlier indicated, that did not amount to outright opposition. It is, nonetheless, troubling that there was little to be said for this condition having been met. 2. With respect to the provision of evidence of community support, there was a greater volume of material but, for the reasons discussed above, some doubt about its quality. That is particularly so in the light of the revised response of the Jerrys Plains Mine Watch Committee sent directly to the Minister's office on 7 October 2008. There is, however, no evidence that Mr Maitland was aware of the response received by Mr Macdonald. Mr Maitland's perspective may then have been that the Minister had received only favourable letters. As I have said, the process was problematic, but it is more difficult to find that it redounds to the detriment of Mr Maitland's case, at least in the same way as it does with respect to Mr Macdonald. 3. While, again, it is easy to determine what Mr Maitland could have, and perhaps, should have, known, it is more difficult to be satisfied of his knowledge of Mr Macdonald's misconduct beyond reasonable doubt. I am left with a doubt that Mr Maitland intended that Mr Macdonald would grant the exploration licence on 15 December 2008 and that his driving force fordoing so would be to benefit Mr Maitland such that but for that purpose the licence would not have been granted. It follows that I am not satisfied that Mr Maitland intended that Mr Macdonald would misconduct himself in granting the exploration licence. That being the case, I am not satisfied of one of the essential elements of the offence charged against Mr Maitland and he must be acquitted with respect to count 4 on the indictment. 4. For completeness, I note that I see no inconsistency between the findings I have made with respect to Mr Macdonald and Mr Maitland. Not only was the evidence admitted against each not the same, as I have been at pains to point out, the perspective from which each approached the process, as a result of their particular responsibilities was very different. It might be asked "why did Mr Macdonald act as he did if he was not put up to it by Mr Maitland?" There was no onus on Mr Maitland to answer that question. The simple fact is the evidence against Mr Macdonald satisfies me beyond reasonable doubt that he committed the offences charged against him. With respect to Mr Maitland it does not. Orders 1. With respect to the indictment dated 6 February 2017, I make the following orders: 1. Ian Michael Macdonald, on count 1, that on or about 21 August 2008 in Sydney in the State of New South Wales, then holding public office as Minister for Mineral Resources you did in the course of and connected to your public office wilfully misconduct yourself by granting Doyles Creek Mining Pty Ltd consent to apply for an exploration licence under the Mining Act 1992 (NSW), without reasonable cause or justification, where such misconduct is serious and meriting criminal punishment having regard to the responsibilities of the office and the officeholder, the importance of the public objects which they serve and the nature and extent of the departure from those objects, I find you guilty. 2. John William Maitland, on count 2, where it is alleged that with respect to count 1 on which I have found Mr Macdonald guilty, you did beforehand aid, abet, counsel and procure the commission of the offence, I find you not guilty. 3. Ian Michael Macdonald, on count 3, that on or about 15 December 2008 in Sydney in the State of New South Wales, then holding public office as Minister for Mineral Resources you did in the course of and connected to your public office wilfully misconduct yourself by granting to Doyles Creek Mining Pty Ltd Exploration Licence No. 7270 under the Mining Act, without reasonable cause or justification, where such misconduct is serious and meriting criminal punishment having regard to the responsibilities of the office and the officeholder, the importance of the public objects which they serve and the nature and extent of the departure from those objects, I find you guilty. 4. John William Maitland, on count 4, where it is alleged that, with respect to count 3 on which I have found Mr Macdonald guilty, you did beforehand aid, abet, counsel and procure the commission of the offence, I find you not guilty. 1. Mr Maitland, you are discharged on the aforementioned indictment. ********** Endnotes 1. MFI 15. 2. Exhibit A, pp 451-452; Tcpt, 10 October 2022, p 832 (Poole). 3. Exhibit TAE. 4. MFI 1. 5. Evidence Act 1995 (NSW), s 69(2). 6. Exhibit TA. 7. Exhibit TA – Tcpt, 7 February 2017, pp 77-78 (Foley). 8. Exhibit TA – Tcpt, 7 February 2017, p 77 (Foley) 9. Exhibit TB. 10. Exhibit TB – Tcpt, 7 February 2017, p 105 (Campbell). 11. Exhibit TC. 12. Exhibit TC – Tcpt, 7 February 2017, p 113 (Bastian). 13. Exhibit TD. 14. Exhibit TD – Tcpt, 7 February 2017, p 118 (Smith). 15. Exhibit TH. 16. Tcpt, 12 September 2022, p 144 (Iemma). 17. Exhibit TE. 18. Exhibit TE – Tcpt, 8 February 2017, pp 170-171 (Costa). 19. Exhibit TE – Tcpt, 8 February 2017, p 171 (Costa). 20. Exhibit TF. 21. Exhibit TF – Tcpt, 17 February 2017, p 733 (Albanese). 22. Exhibit TF – Tcpt, 17 February 2017, p 734 (Albanese). 23. Exhibit TF – Tcpt, 17 February 2017, p 734 (Albanese). 24. Exhibit TF – Tcpt, 17 February 2017, p 733 (Albanese). 25. Exhibit TF – Tcpt, 17 February 2017, p 739 (Albanese). 26. Exhibit TG. 27. Exhibit TG – Tcpt, 20 February 2017, pp 817-818 (Cameron). 28. Exhibit TI. 29. Exhibit TI – Tcpt, 8 February 2017, pp 184-185 (Mullard). 30. Exhibit TI – Tcpt, 8 February 2017, p 185 (Mullard). 31. Exhibit TI – Tcpt, 8 February 2017, p 185 (Mullard). 32. Exhibit TJ. 33. Exhibit TJ – Tcpt, 14 February 2017, p 501 (Coutts). 34. Exhibit TJ – Tcpt, 14 February 2017, pp 502-503 (Coutts). 35. Exhibit TJ – Tcpt, 14 February 2017, pp 503-504 (Coutts). 36. Exhibit TK. 37. Exhibit TL. 38. Exhibit TL – Tcpt, 16 February 2017, p 644 (Madden). 39. Exhibit TL – Tcpt, 16 February 2017, p 645 (Madden). 40. Exhibit TM. 41. Exhibit IM-13. 42. Exhibit TN. 43. Exhibit TN – Tcpt, 16 February 2017, p 706 (Hewson). 44. Exhibit TN – Tcpt, 17 February 2017, p 746 (Hewson). 45. Exhibit TO. 46. Exhibit TP. 47. Exhibit TG. 48. Exhibit TR. 49. Exhibit TS. 50. Exhibit IM-5. I note that in evidence the author was referred to as Bob Gibbons, I presume on the basis of the witnesses' familiarity with Mr Gibbons. 51. Exhibit TT. 52. Exhibit TT – Tcpt, 20 February 2017, pp 902-903 (Papallo). 53. Exhibit TU. 54. Exhibit TU – Tcpt, 21 February 2017, p 922 (Jones). 55. Exhibit TU – Tcpt, 21 February 2017, pp 922-923 (Jones). 56. Exhibit TV. 57. Exhibit TV – Tcpt, 21 February 2017, p 968 (Healey). 58. Exhibit TV – Tcpt, 21 February 2017, p 969 (Healey). 59. Exhibit TV – Tcpt, 21 February 2017, p 967 (Healey). 60. Exhibit TW. 61. Exhibit TX. 62. Exhibit TX – Tcpt, 22 February 2017, p 1016 (Tudehope). 63. Exhibit TX – Tcpt, 22 February 2017, p 1030 (Tudehope). 64. Exhibit TY. 65. Exhibit TZ. 66. Exhibit TAA. 67. Exhibit TAA – Tcpt, 27 February 2017, p 1137 (Coates). 68. Exhibit TAC. 69. Exhibit TAD. 70. Exhibit AE. 71. Exhibit TAF. 72. Exhibit TAF – Tcpt, 9 October 2017, p 735 (Ireland). 73. Exhibit AE, p 13. 74. Exhibit AF. 75. Exhibit TAE. 76. Exhibit TAE – Tcpt, 6 March 2017, p 1656 (Macdonald). 77. Tcpt, 17 October 2022, p 966 (Della Bosca). 78. Exhibit JM-2. 79. Exhibit TA – Tcpt, 7 February 2017, p 87 (Foley). 80. Exhibit TF – Tcpt, 17 February 2017, p 739 (Albanese). 81. Tcpt, 5 October 2022, p 489 (Maitland). 82. Exhibit TA – Tcpt, 7 February 2017, p 94 (Foley). 83. Exhibit TA – Tcpt, 20 February 2020, p 277 (Foley). 84. Exhibit TA – Tcpt, 7 February 2017, p 94 (Foley). 85. Exhibit TA – Tcpt, 7 February 2017, p 96 (Foley). 86. Exhibit TA – Tcpt, 7 February 2017, p 88 (Foley). 87. Exhibit TB – Tcpt, 7 February 2017 p 105 (Campbell). 88. Exhibit TB – Tcpt, 7 February 2017, p 107 (Campbell). 89. Exhibit TB – Tcpt, 7 February 2017, p 107 (Campbell). 90. Exhibit TC – Tcpt, 7 February 2017, p 115 (Campbell). 91. Exhibit TF – Tcpt, 17 February 2017, p 736 (Albanese). 92. Tcpt, 17 October 2022, p 970 (Della Bosca). 93. Tcpt, 17 October 2022, pp 970-971 (Della Bosca). 94. Tcpt, 5 October 2022, pp 487-488 (Maitland). 95. Tcpt, 5 October 2022, p 488 (Maitland). 96. Tcpt, 5 October 2022, p 489 (Maitland). 97. Exhibit TA – Tcpt, 7 February 2017, p 83 (Foley). 98. Exhibit TA – Tcpt, 7 February 2017, p 83 (Foley). 99. Exhibit TA – Tcpt, 7 February 2017, p 103 (Foley). 100. Exhibit TB – Tcpt, 7 February 2017, pp 111-112 (Campbell). 101. Exhibit TC – Tcpt, 7 February 2017, p 117 (Bastian). 102. Exhibit TG – Tcpt, 20 February 2017, p 819 (Cameron) 103. Exhibit TG – Tcpt, 20 February 2017, p 824 (Cameron). 104. Exhibit TH – Tcpt, 8 February 2017, p 155 (Iemma); Exhibit TE – Tcpt, 8 February 2017, p 171 (Costa). 105. Exhibit TN – Tcpt, 17 February 2017, p 745 (Hewson). 106. Exhibit TN – Tcpt, 17 February 2017, p 745 (Hewson). 107. Exhibit TN – Tcpt, 17 February 2017, p 758 (Hewson). 108. Exhibit TO – Tcpt, 17 February 2017 , p 767 (Tan). 109. Exhibit TP – Tcpt, 20 February 2017, p 884 (Gibson). 110. Exhibit TP – Tcpt, 20 February 2017, p 884 (Gibson). 111. Exhibit TP – Tcpt, 20 February 2017, p 885 (Gibson). 112. Exhibit TJ – Tcpt, 15 February 2017, p 549 (Coutts). 113. Exhibit TJ – Tcpt, 15 February 2017, p 606 (Coutts). 114. Exhibit TJ – Tcpt, 15 February 2017, p 549 (Coutts). 115. Exhibit TJ – Tcpt, 15 February 2017, p 549 (Coutts). 116. Tcpt, 16 September 2022, p 270 (Coutts). 117. Exhibit TAC – Tcpt, 21 February 2017, p 945 (Maher). 118. Exhibit TAC – Tcpt, 21 February 2017, pp 945-946 (Maher). 119. Exhibit TAC – Tcpt, 21 February 2017, p 946 (Maher). 120. Tcpt, 5 October 2022, pp 486-487 (Maitland). 121. Exhibit TH – Tcpt, 8 February 2017, p 168 (Iemma). 122. Exhibit TAC – Tcpt, 21 February 2017, p 955 (Maher). 123. cf Edwards v The Queen (1993) 178 CLR 193; [1993] HCA 63. 124. Exhibit TAE – Tcpt, 3 March 2017, p 1485 (Macdonald). 125. Exhibit TJ – Tcpt, 14 February 2017, p 536 (Coutts). 126. Tcpt, 4 October 2022, p 451 (Maitland). 127. Tcpt, 4 October 2022, pp 451-452 (Maitland). 128. Tcpt, 4 October 2022, p 442 (Maitland). 129. Tcpt, 4 October 2022, p 443 (Maitland). 130. Exhibit JM-2. 131. Tcpt, 7 October 2022, p 729 (Lewis). 132. Tcpt, 7 October 2022, p 730 (Lewis). 133. Tcpt, 4 October 2022, pp 432-433 (Maitland). 134. Tcpt, 4 October 2022, p 433 (Maitland). 135. Tcpt, 4 October 2022, p 434 (Maitland). 136. Tcpt, 4 October 2022, p 434 (Maitland). 137. Tcpt, 4 October 2022, p 434 (Maitland). 138. Tcpt, 7 October 2022, p 742 (Lewis). 139. Tcpt, 4 October 2022, p 434 (Maitland). 140. Tcpt, 4 October 2022, p 435 (Maitland). 141. Tcpt, 4 October 2022, p 456 (Maitland). 142. Tcpt, 4 October 2022, p 456 (Maitland). 143. Exhibit TG – Tcpt, 20 February 2017, p 822 (Cameron). 144. Exhibit TQ – Tcpt, 21 February 2017, p 966 (McPherson). 145. Exhibit TI – Tcpt, 13 February 2017, p 405 (Mullard). 146. Tcpt, 10 October 2022, p 766 (Lewis). 147. Tcpt, 27 September 2022, p 373 (Buffier). 148. Exhibit AF, par (20). 149. Tcpt, 7 October 2022, pp 727-729 (Lewis). 150. Tcpt, 7 October 2022, p 784 (Lewis); Tcpt, 12 October 2022, p 869 (Poole). 151. Exhibit JM-7, p 8. 152. Tcpt, 12 October 2022, p 868 (Poole). 153. Tcpt, 7 October 2022, p 782 (Lewis). 154. Exhibit TAE – Tcpt, 1 March 2017, p 1316 (Macdonald). 155. Exhibit A, pp 235E, 393E. 156. Exhibit TAE – Tcpt, 1 March 2017, p 1317 (Macdonald). 157. Exhibit TAE – Tcpt, 1 March 2017, p 1311 (Macdonald). 158. Tcpt, 12 September 2022, p 134 (Iemma). 159. Tcpt, 12 September 2022, p 126 (Iemma). 160. Tcpt, 12 September 2022, p 128 (Iemma). 161. Exhibit TK – Tcpt, 16 February 2017, pp 637-638 (Sheldrake). 162. Exhibit B. 163. Exhibit A, pp 107-116; Exhibit D. 164. Exhibit TAE – Tcpt, 2 March 2017, p 1388 (Macdonald). 165. Exhibit TAE – Tcpt, 2 March 2017, p 1388 (Macdonald). 166. Tcpt, 17 October 2022, pp 970, 974 (Della Bosca). 167. See Exhibit A, p 55. 168. Exhibit TI – Tcpt, 8 February 2017, p 186 (Mullard). 169. Tcpt, 14 September 2022, pp 205, 230 (Mullard). 170. Tcpt, 10 October 2022, p 803 (Lewis). 171. Tcpt, 20 September 2022, p 312 (Moloney). 172. Tcpt, 4 October 2022, pp 459-460 (Maitland). 173. Tcpt, 7 October 2022, pp 733-734 (Lewis). 174. Tcpt, 4 October 2022, pp 436, 461 (Maitland); Tcpt, 5 October 2022, p 529 (Maitland). 175. Tcpt, 12 October 2022, p 879 (Poole). 176. Tcpt, 7 October 2022, p 734 (Lewis). 177. Tcpt, 5 October 2022, pp 526, 528 (Maitland); Tcpt, 6 October 2022, pp 608-609 (Maitland). 178. Exhibit TI – Tcpt, 10 February 2017, pp 314-315; Tcpt, 13 February 2017, p 403 (Mullard). 179. Exhibit TI – Tcpt, 8 February 2017, p 118; Tcpt, 10 February 2017, p 315 (Mullard). 180. Tcpt, 7 October 2022, p 732 (Lewis). 181. Exhibit TJ – Tcpt, 14 October 2017 (Coutts). 182. Exhibit TI – Tcpt, 8 February 2017, p 186 (Mullard). 183. Exhibit TI – Tcpt, 8 February 2017, p 190 (Mullard). 184. Exhibit TJ – Tcpt, 14 February 2017, p 507 (Coutts). 185. Exhibit TI – Tcpt, 8 February 2017, p 188 (Mullard); Tcpt, 14 September 2022, p 181 (Mullard). 186. Exhibit TJ – Tcpt, 14 February 2017, p 514 (Coutts). 187. Exhibit TI – Tcpt, 8 February 2017, p 188 (Mullard). 188. Exhibit TJ – Tcpt, 14 February 2017, p 507 (Coutts). 189. Exhibit TI – Tcpt, 8 February 2017, p 190 (Mullard). 190. Exhibit A, p 89. 191. Exhibit A, pp 387-391. 192. Exhibit A, p 100. 193. Exhibit A, p 100. 194. Exhibit A, p 101. 195. Tcpt, 14 September 2022, pp 203-204 (Mullard). 196. Exhibit TAE – Tcpt, 3 March 2017, p 1514 (Macdonald). 197. Exhibit TI – Tcpt, 8 February 2017, pp 196-197 (Mullard). 198. Exhibit TI – Tcpt, 8 February 2017, pp 197 (Mullard). 199. Exhibit TI – Tcpt, 10 February 2017, p 317 (Mullard). 200. Exhibit TI – Tcpt, 8 February 2017, p 196 (Mullard). 201. Exhibit TAE – Tcpt, 1 March 2017, p 1299 (Macdonald). 202. Exhibit P. 203. Exhibit TI – Tcpt, 10 February 2017, p 317 (Mullard). 204. Exhibit TI – Tcpt, 14 February 2017, p 489 (Mullard). 205. Exhibit H; Exhibit TI – Tcpt, 10 February 2017, p 320 (Mullard). 206. Exhibit TI – Tcpt, 10 February 2017, p 318 (Mullard). 207. Exhibit H; Exhibit TI – Tcpt, 10 February 2017, p 235 (Mullard). 208. See Exhibit H. 209. Exhibit JM-6. 210. Exhibit TAE – Tcpt, 1 March 2017, p 1302 (Macdonald). 211. Exhibit TAE – Tcpt, 2 March 2017, p 1401 (Macdonald). 212. Exhibit TAE – Tcpt, 2 March 2017, p 1417 (Macdonald). 213. Exhibit TAE – Tcpt, 2 March 2017, p 1436 (Macdonald). 214. Exhibit TAE – Tcpt, 1 March 2017, p 1289 (Macdonald); Exhibit A, p 261. 215. Exhibit TJ – Tcpt, 14 February 2017, p 522 (Coutts). 216. Exhibit U. 217. Exhibit A, p 203F. 218. Exhibit TI – Tcpt, 13 February 2017, p 360 (Mullard). 219. Exhibit A, p 235D; Exhibit TI – Tcpt, 9 February 2017, p 278 (Mullard). 220. Exhibit TAD – Tcpt, 27 February 2017, p 1174 (Williams). 221. Exhibit TAA – Tcpt, 27 February 2017, pp 1137-1138 (Coates). 222. Exhibit TAD – Tcpt, 27 February 2017, pp 1174-1175 (Williams). 223. Exhibit TH – Tcpt, 8 February 2012, p 144 (Iemma). 224. Exhibit TH – Tcpt, 8 February 2012, p 148 (Iemma). 225. Exhibit TH – Tcpt, 8 February 2012, p 148 (Iemma). 226. Exhibit TH – Tcpt, 8 February 2012, p 148 (Iemma). 227. Exhibit TH – Tcpt, 8 February 2012, p 149 (Iemma). 228. Exhibit TH – Tcpt, 8 February 2017, p 150 (Iemma). 229. Exhibit TR – Tcpt, 22 February 2017, p 1039 (Rees). 230. Exhibit A (Caroona and Watermark), p C-005. 231. Exhibit A (Caroona and Watermark), p C-025. 232. Exhibit TJ, p 511 233. Exhibit TJ – Tcpt, 14 February 2017, p 512 (Coutts). 234. Exhibit A (Caroona and Watermark), p W-001. 235. Exhibit A (Caroona and Watermark), p W-063. 236. Exhibit TJ – Tcpt, 14 February 2017, p 515 (Coutts). 237. Tcpt, 14 September 2022, p 200 (Mullard). 238. Tcpt, 14 September 2022, p 200 (Mullard). 239. Tcpt, 14 September 2022, p 200 (Mullard). 240. Tcpt, 14 September 2022, p 229 (Mullard). 241. Tcpt, 20 September 2022, p 313 (Moloney). 242. Exhibit A (Caroona and Watermark), p C-019. 243. Exhibit A (Caroona and Watermark), p W-008. 244. Tcpt, 20 September 2022, p 314 (Moloney); Exhibit A, p 650. 245. Exhibit TI – Tcpt, 10 February 2017, p 306 (Mullard). 246. See Exhibit TAE – Tcpt, 1 March 2017, p 1346 (Macdonald). 247. Exhibit A, p 98. 248. Exhibit TJ – Tcpt, 14 February 2017, p 515 (Coutts). 249. Exhibit TAE – Tcpt, 6 March 2017, p 1636 (Macdonald). 250. Exhibit E. 251. Exhibit TAE – Tcpt, 6 March 2017, pp 1601-1602 (Macdonald). 252. Exhibit TAE – Tcpt, 6 March 2017, p 1603 (Macdonald). 253. Exhibit TAE – Tcpt, 1 March 2017, p 1345 (Macdonald). 254. Exhibit A, p 570. 255. Exhibit A, p 198A. 256. Exhibit A, p 40. 257. Exhibit A, p 40. 258. Exhibit TI – Tcpt, 10 February 2017, p 346 (Mullard). 259. Exhibit A, pp 56-58. 260. Compare Exhibit A, p 198A with Exhibit A, p 792. 261. Exhibit A, pp 80-81. 262. Exhibit A, pp 27-39. 263. Exhibit A, p 317. 264. Exhibit TJ – Tcpt, 14 February 2017, p 534 (Coutts). 265. Exhibit A, p 317. 266. Exhibit A, p 337. 267. Exhibit A, p 392. 268. Exhibit A, p 393. 269. Exhibit A, p 393. 270. Exhibit A, p 392. 271. Exhibit A, p 153D. 272. Tcpt, 4 October 2022, p 480 (Maitland). 273. Exhibit A, p 144. 274. Exhibit TAE – Tcpt, 2 March 2017, pp 1291-1293 (Macdonald). 275. Exhibit TAE – Tcpt, 2 March 2017, p 1409 (Macdonald). 276. Tcpt, 5 October 2022, p 502 (Maitland). 277. Tcpt, 4 October 2022, p 438 (Maitland). 278. Tcpt, 5 October 2022, p 501 (Maitland). 279. Tcpt, 4 October 2022, p 438 (Maitland). 280. Exhibit A, pp 156, 189. 281. Exhibit A, p 155. 282. Exhibit A, p 160. 283. Exhibit A, p 156. 284. Exhibit A, p 40. 285. Exhibit TI – Tcpt, 10 February 2017, p 342 (Mullard). 286. Exhibit TAE – Tcpt, 1 March 2017, p 1294 (Macdonald). 287. Exhibit A, p 160A. 288. Exhibit TAE – Tcpt, 1 March 2017, p 1296 (Macdonald). 289. Exhibit A, p 162. 290. Exhibit A, p 163. 291. Exhibit A, p 164. 292. Exhibit TN – Tcpt, 16 February 2017, p 720 (Hewson). 293. Exhibit A, p 172. 294. Exhibit A, p 175. 295. Exhibit TL – Tcpt, 16 February 2017, p 649 (Madden). 296. Exhibit A, p 176. 297. Exhibit TAE – Tcpt, 2 March 2017 p 1418 (Macdonald). 298. Exhibit TI – Tcpt, 8 February 2017, pp 198-200 (Mullard). 299. Exhibit A, p 175. 300. Exhibit A, p 175. 301. Exhibit A, p 175. 302. Exhibit A, p 188. 303. Exhibit A, p 189 at dot point 1. 304. Exhibit A, p 190 at [8]. 305. Exhibit A, pp 197-198. 306. See Exhibit A, pp 27-39; Exhibit JM-4. 307. Exhibit TJ – Tcpt, 14 February 2017, p 521 (Coutts). 308. Exhibit TI – Tcpt, 9 February 2017, p 277 (Mullard). 309. Exhibit TI – Tcpt, 14 February 2017, p 477 (Mullard). 310. Exhibit TAE – Tcpt, 1 March 2017, p 1301 (Macdonald). 311. Exhibit TAE – Tcpt, 1 March 2017, p 1301 (Macdonald). 312. Exhibit TAE – Tcpt, 2 March 2017, p 1430 (Macdonald). 313. Exhibit TAE – Tcpt, 1 March 2017, p 1302 (Macdonald). 314. Exhibit TAE – Tcpt, 1 March 2017, p 1297 (Macdonald). 315. Exhibit TAE – Tcpt, 1 March 2017, p 1297 (Macdonald). 316. Exhibit TAE – Tcpt, 1 March 2017, p 1298 (Macdonald). 317. Exhibit TAE – Tcpt, 1 March 2017, p 1299 (Macdonald). 318. Exhibit TAE – Tcpt, 1 March 2017, p 1301 (Macdonald). 319. Exhibit IM-5. 320. Exhibit TAE – Tcpt, 1 March 2017, p 1302 (Macdonald). 321. Exhibit TAE – Tcpt, 1 March 2017, p 1302 (Macdonald). 322. Exhibit TAE – Tcpt, 1 March 2017, p 1302 (Macdonald). 323. Exhibit TAE – Tcpt, 1 March 2017, p 1302 (Macdonald). 324. Exhibit TAE – Tcpt, 1 March 2017, p 1303 (Macdonald). 325. Exhibit TN – Tcpt, 17 February 2017, pp 741-742 (Hewson). 326. Exhibit TN – Tcpt, 17 February 2017, p 749 (Hewson). 327. Exhibit A, p 203B. 328. Exhibit A, pp 204-205. 329. Exhibit TO – Tcpt, 17 February 2017, p 788 (Tan). 330. Tcpt, 5 October 2022, p 521 (Maitland). 331. Tcpt, 12 September 2022, p 149 (Iemma); Tcpt, 17 October 2022, p 976 (Della Bosca). 332. Exhibit TAE – Tcpt, 1 March 2017, p 1303 (Macdonald). 333. Exhibit A, p 231. 334. Exhibit IM-6. 335. Tcpt, 6 October 2022, pp 630-631 (Maitland). 336. Exhibit TO – Tcpt, 17 February 2017, p 788 (Tan). 337. Exhibit TO – Tcpt, 17 February 2017, p 808 (Tan). 338. Exhibit TO – Tcpt, 17 February 2017, p 809 (Tan). 339. Exhibit TAE – Tcpt, 1 March 2017, p 1309 (Macdonald). 340. Exhibit TAE – Tcpt, 1 March 2017, p 1310 (Macdonald). 341. Tcpt, 12 September 2022, pp 138-193 (Iemma). 342. Exhibit TAE – Tcpt, 1 March 2017, p 1311 (Macdonald). 343. Exhibit TO – Tcpt, 17 February 2017, p 788 (Tan). 344. Exhibit TAE – Tcpt, 2 March 2017, p 1455 (Macdonald). 345. Tcpt, 5 October 2022, p 533 (Maitland). 346. Tcpt, 5 October 2022, p 533 (Maitland). 347. Exhibit A, p 240. 348. Exhibit A, pp 245-250. 349. Exhibit A, p 248. 350. Exhibit A, pp 248-249. 351. Exhibit TAE – Tcpt, 1 March 2017, p 1313 (Macdonald). 352. Exhibit TAE – Tcpt, 3 March 2017, p 1476 (Macdonald). 353. Exhibit A, pp 269-270. 354. Exhibit A, p 270. 355. Exhibit TU – Tcpt, 21 February 2017, p 930 (Jones). 356. Exhibit TU – Tcpt, 21 February 2017, p 942 (Jones). 357. Exhibit X. 358. Exhibit A, p 251; Exhibit TO – 17 February 2017 p 794 (Tan). 359. Exhibit A, p 255A. 360. Exhibit A, p 263. 361. Exhibit TAC – Tcpt, 21 February 2017, pp 950-951 (Maher). 362. Tcpt, 5 October 2022, p 532 (Maitland). 363. Exhibit TAE – Tcpt, 1 March 2017, p 1312 (Macdonald). 364. Tcpt, 5 October 2022, p 538 (Maitland). 365. Exhibit A, p 265. 366. Exhibit A, p 258; Exhibit TU – Tcpt, 21 February 2017, p 937 (Jones). 367. Exhibit TAE – Tcpt, 1 March 2017, p 1320 (Macdonald). 368. Exhibit A, pp 266-267. 369. Exhibit A, p 274. 370. Exhibit TAE – Tcpt, 1 March 2017, p 1468 (Macdonald). 371. Exhibit TAE – Tcpt, 1 March 2017, pp 1320, 1467 (Macdonald). 372. Exhibit A, p 276. 373. Exhibit TO – Tcpt, 17 February 2017, p 814 (Tan). 374. Exhibit A, p 283. 375. Exhibit A, p 283. 376. Exhibit TAE – Tcpt, 1 March 2017, p 1326 (Macdonald). 377. Exhibit TAE – Tcpt, 1 March 2017, p 1327 (Macdonald). 378. Exhibit TJ – Tcpt, 14 February 2017, p 536 (Coutts). 379. Exhibit TAE – Tcpt, 1 March 2017, p 1328 (Macdonald). 380. Exhibit TAE – Tcpt, 2 March 2017, p 1464 (Macdonald). 381. Exhibit TAE – Tcpt, 2 March 2017, p 1461 (Macdonald). 382. Tcpt, 5 October 2022, p 534 (Maitland). 383. Exhibit TAE – Tcpt, 3 March 2017, pp 1475-1476 (Macdonald) 384. Exhibit A, p 393E. 385. Exhibit A, p 420. 386. Exhibit A, p 431. 387. Exhibit A, pp 435-436. 388. Exhibit A, p 460. 389. Exhibit A, p 444. 390. Exhibit A, pp 458-459. 391. Exhibit A, p 461. 392. Exhibit A, p 474. 393. Exhibit A, p 461. 394. Exhibit A, p 470. 395. Exhibit AE, pp 2-3. 396. Tcpt, 4 October 2022, p 454 (Maitland). 397. Exhibit TAE – Tcpt, 1 March 2017, p 1337 (Macdonald). 398. Exhibit TAE – Tcpt, 2 March 2017, p 1338 (Macdonald). 399. Tcpt, 16 September 2022, pp 256-257 (Coutts); Tcpt, 14 September 2022, pp 210-211 (Mullard). 400. Exhibit TAE – Tcpt, 1 March 2017, p 1339 (Macdonald). 401. Exhibit TP – Tcpt 20 February 2017, pp 832-833 (Gibson). 402. Exhibit TP – Tcpt, 20 February 2017, pp 837, 887 (Gibson). 403. Exhibit TP – Tcpt, 20 February 2017, p 888 (Gibson); Exhibit TAE – Tcpt, 1 March 2017, p 1341 (Macdonald). 404. Exhibit TI – Tcpt, 13 February 2017, p 376 (Mullard). 405. Exhibit A, p 498. 406. Exhibit TAE – Tcpt, 1 March 2017, p 1340 (Macdonald). 407. Exhibit A, pp 504-506. 408. Exhibit TJ – Tcpt, 14 February 2017, p 536 (Coutts). 409. Exhibit TJ – Tcpt, 15 February 2017, pp 544-545 (Coutts). 410. Exhibit TP – Tcpt, 20 February 2017, p 839 (Gibson). 411. Exhibit TAE – Tcpt, 1 March 2017, p 1341 (Macdonald). 412. Exhibit TAE – Tcpt, 1 March 2017, p 1344 (Macdonald). 413. Exhibit TAE – Tcpt, 6 March 2017, p 1564 (Macdonald). 414. Exhibit TAE – Tcpt, 3 March 2017, p 1532 (Macdonald). 415. Exhibit TAE – Tcpt, 1 March 2017, pp 1345-1346 (Macdonald). 416. Exhibit TI – Tcpt, 10 February 2017, pp 303-305 (Mullard); Tcpt, 14 September 2022, pp 200, 229 (Mullard). 417. Exhibit TJ – Tcpt, 14 February 2017, p 515 (Coutts). 418. Exhibit A, pp 247-249. 419. Tcpt, 27 September 2022, pp 379-380 (Buffier). 420. Tcpt, 10 October 2022, p 805 (Lewis). 421. Exhibit L. 422. Exhibit TAE – Tcpt, 3 March 2017, pp 1475-1476 (Macdonald). 423. Exhibit TAE – Tcpt, 3 March 2017, p 1519 (Macdonald). 424. Exhibit TAE – Tcpt, 3 March 2017, p 1520 (Macdonald). 425. Exhibit TAE – Tcpt, 6 March 2017, p 1584; Tcpt, 3 March 2017, p 1543 (Macdonald). 426. Exhibit TAE – Tcpt, 1 March 2017, p 1344 (Macdonald). 427. Exhibit TAE – Tcpt, 1 March 2017, p 1344 (Macdonald). 428. Exhibit TAE – Tcpt, 1 March 2017, p 1344 (Macdonald). 429. Exhibit TAE – Tcpt, 1 March 2017, p 1344 (Macdonald). 430. Exhibit TAE – Tcpt, 1 March 2017, p 1344 (Macdonald). 431. Exhibit TAE – Tcpt, 3 March 2017, p 1348 (Macdonald). 432. Exhibit TAE – Tcpt, 1 March 2017, pp 1348-1349 (Macdonald). 433. Exhibit TAE – Tcpt, 2 March 2017, p 1386 (Macdonald). 434. Exhibit TAE – Tcpt, 2 March 2017, p 1348 (Macdonald). 435. Exhibit TJ – Tcpt, 14 February 2017, p 536 (Coutts). 436. Exhibit TJ – Tcpt, 15 February 2017, p 585 (Coutts). 437. Exhibit TAE – Tcpt, 1 March 2017, p 1349 (Macdonald). 438. Exhibit TI – Tcpt, 9 February 2017, p 291 (Mullard); Tcpt,13 February 2017, p 383 (Mullard). 439. Exhibit TI – Tcpt 9 February 2017, p 291 (Mullard). 440. Exhibit TI - Tcpt, 9 February 2017, p 291 (Mullard). 441. Exhibit TI – Tcpt, 13 February 2017, p 384 (Mullard). 442. Exhibit TI – Tcpt, 9 February 2017, p 292 (Mullard). 443. Exhibit TAE – Tcpt, 6 March 2017, p 1580 (Macdonald). 444. Exhibit TAE – Tcpt, 1 March 2017, p1356 (Macdonald). 445. Exhibit TAE – Tcpt, 3 March 2017, p 1514 (Macdonald). 446. Exhibit TP – Tcpt, 20 March 2017, p 897 (Gibson). 447. Exhibit TAE – Tcpt, 1 March 2017, p 1350 (Macdonald). 448. Exhibit TAE – Tcpt, 1 March 2017, p 1351 (Macdonald). 449. Exhibit TAE – Tcpt, 6 March 2017, p 1590 (Macdonald). 450. Exhibit TAE – Tcpt, 6 March 2017, p 1591 (Macdonald). 451. Exhibit TR – Tcpt, 22 February 2017, p 1045 (Rees); Tcpt, 12 September 2022, pp 138-139 (Iemma). 452. Exhibit TAE – Tcpt, 6 March 2017, p 1594 (Macdonald). 453. Exhibit TAE – Tcpt, 6 March 2017, p 1587 (Macdonald). 454. Tcpt, 6 October 2022, p 634 (Maitland). 455. Exhibit A, p 531. 456. Exhibit TAE – Tcpt, 6 March 2017, pp 1598-1599 (Macdonald). 457. Exhibit A, p 534; Exhibit TAE – Tcpt, 6 March 2017, p 1599 (Macdonald). 458. Exhibit A, p 534. 459. Exhibit A, p 535. 460. Exhibit TAE – Tcpt, 6 March 2017, p 1601 (Macdonald). 461. Exhibit V. 462. Exhibit TAE – Tcpt, 1 March 2017, p 1359 (Macdonald). 463. Exhibit TAE – Tcpt, 1 March 2017, p 1360 (Macdonald). 464. Exhibit TAE – Tcpt, 1 March 2017, p 1361 (Macdonald). 465. Exhibit TAD – Tcpt, 27 February 2017, p 1178 (Williams). 466. Exhibit TAD – Tcpt, 27 February 2017, p 1178 (Williams). 467. Exhibit TAD – Tcpt, 27 February 2017, pp 1178-1179 (Williams). 468. Exhibit TAD – Tcpt, 27 February 2017, p 1180 (Williams). 469. Exhibit TAD – Tcpt, 27 February 2017 p 1181 (Williams). 470. Exhibit TAD – 27 February 2017, p 1188 (Williams). 471. Exhibit TAE – Tcpt, 7 March 2017, p 1678 (Macdonald). 472. Exhibit A, p 620. 473. Exhibit A, p 620. 474. Exhibit A, p 622. 475. Exhibit JM-1 (Tab 13). 476. Exhibit A, p 622 477. Exhibit TP – Tcpt, 20 February 2017, p 870 (Gibson). 478. Exhibit TAD – Tcpt, 27 February 2017, p 1196 (Williams). 479. Exhibit TP – Tcpt, 20 February 2017, pp 870-871 (Gibson). 480. Exhibit TAD – Tcpt, 27 February 2017, p 1187 (Williams). 481. Exhibit TAE – Tcpt, 2 March 2017, p 1373 (Macdonald). 482. Exhibit A, pp 536B-536D. 483. Exhibit TAE – Tcpt, 6 March 2017 p 1603 (Macdonald). 484. Exhibit TP – Tcpt, 20 February 2017, p 851 (Gibson). 485. Exhibit TP – Tcpt, 20 February 2017, p 851 (Gibson). 486. Exhibit A, pp 548-553. 487. Exhibit TI – Tcpt, 9 February 2017, p 245 (Mullard). 488. Exhibit TI – Tcpt, 9 February 2017, p 188 (Mullard). 489. Exhibit TI – Tcpt, 9 February 2017, pp 249-250 (Mullard); Exhibit Q. 490. Exhibit Q. 491. Exhibit Q, p 9. 492. Exhibit S, p 19. 493. Exhibit TAE – Tcpt, 6 March 2017, p 1575 (Macdonald). 494. Exhibit A, p 156. 495. Tcpt, 10 October 2022, p 816 (Lewis). 496. Exhibit S, pp 5, 8. 497. Exhibit A, pp 406B-406C. 498. Exhibit TAE – Tcpt, 1 March 2017, p 1332 (Macdonald). 499. Exhibit A, pp 499B-499J. 500. Exhibit TAE – Tcpt, 6 March 2017, p 1664 (Macdonald). 501. Exhibit JM-2; Tcpt, 14 September 2022 , p 214 (Mullard). 502. Tcpt, 14 September 2022, p 214 (Mullard). 503. Exhibit TAE – Tcpt, 2 March 2017, p 1437 (Macdonald). 504. Exhibit TAE – Tcpt, 2 March 2017, p 1450 (Maitland). 505. Exhibit TJ, Tcpt, 14 February 2017, p 523 (Coutts). 506. Exhibit M. 507. Exhibit M. 508. Exhibit TJ – Tcpt, 14 February 2017, p 530 (Coutts). 509. Exhibit TJ – Tcpt, 14 February 2017, p 529 (Coutts). 510. Exhibit TAE – Tcpt, 3 March 2017, pp 1474-1475 (Macdonald). 511. See the minutes at Exhibit A, P 252. 512. Exhibit TJ – Tcpt, 14 February 2017, p 531 (Coutts). 513. Exhibit TT – Tcpt, 20 February 2017, p 910 (Papallo). 514. Exhibit TO – Tcpt, 17 February 2017, p 797 (Tan). 515. Exhibit TAE – Tcpt, 1 March 2017, p 1318 (Macdonald). 516. Exhibit TAE – Tcpt 2 March 2017, p 1438 (Macdonald). 517. Exhibit TH – Tcpt, 8 February 2017, p 142 (Iemma). 518. Exhibit TD – Tcpt, 8 February 2017, p 135 (Smith); Exhibit D. 519. Exhibit C; Exhibit TD – Tcpt, 7 February 2017, pp 131-133, 147 (Smith); Exhibit TH – Tcpt, 8 February 2017, pp 145-146, 158 (Iemma). 520. Exhibit C, p 5. 521. Exhibit TR – Tcpt, 22 February 2017, p 1042 (Rees). 522. Exhibit TAE – Tcpt, 6 March 2017, p 1606 (Macdonald). 523. See, for example, Exhibit A, p 570; Exhibit A (Caroona and Watermark), p C-14; p W-12. 524. Exhibit A (Caroona and Watermark), p W-25; Exhibit TK – Tcpt, 15 February 2017, p 633 (Sheldrake). 525. Exhibit TAE – Tcpt, 6 March 2017, p 1606 (Macdonald). 526. Exhibit TH – Tcpt, 8 February 2017, p 165 (Iemma). 527. Tcpt, 17 October 2022, p 980 (Della Bosca). 528. Exhibit TH – Tcpt, 8 February 2017 pp 153-154 (Iemma). 529. Exhibit TAE – Tcpt, 6 March 2017, p 1645 (Macdonald). 530. Exhibit A, p 584. 531. Exhibit A, p 568. 532. Exhibit TP – Tcpt, 20 February 2017 p 853 (Gibson). 533. Exhibit TP – Tcpt, 20 February 2017, p 854 (Gibson). 534. Exhibit TP – Tcpt, 20 February 2017 p 855 (Gibson). 535. Exhibit TP – Tcpt, 20 February 2017 p 860 (Gibson). 536. Exhibit TP – Tcpt, 20 February 2017, p 860 (Gibson). 537. Exhibit TP – Tcpt, 20 February 2017, pp 860-861 (Gibson). 538. Exhibit TAE – Tcpt, 6 March 2017, p 1642 (Macdonald). 539. Exhibit TP – Tcpt, 20 February 2017, p 836 (Gibson). 540. Exhibit TL – Tcpt, 16 February 2017, p 657 (Madden). 541. Exhibit TL – Tcpt, 16 February 2017, p 657 (Madden). 542. Exhibit TL – Tcpt, 16 February 2017, p 673 (Madden). 543. Exhibit TL – Tcpt, 16 February 2017, p 657 (Madden). 544. Exhibit TL – Tcpt, 16 February 2017, p 658 (Madden). 545. Exhibit TL – Tcpt, 16 February 2017, p 658 (Madden). 546. Exhibit TL – Tcpt, 16 February 2017, p 658 (Madden). 547. Exhibit TL – Tcpt, 16 February 2017 p 674 (Madden) 548. Exhibit TJ – Tcpt, 14 February 2017 p 546 (Coutts); Exhibit TL – Tcpt, 16 February 2017, p 661 (Madden). 549. Exhibit A, p 585. 550. Exhibit A, p 589. 551. Exhibit A, p 614. 552. Exhibit TJ – Tcpt, 15 February 2017, p 590 (Coutts). 553. Exhibit TP – Tcpt, 20 February 2017, pp 855-856 (Gibson). 554. Exhibit TAE – Tcpt, 1 March 2017, p 1361 (Macdonald). 555. Exhibit TAE – Tcpt, 1 March 2017, p 1361 (Macdonald). 556. Exhibit TAE – Tcpt, 1 March 2017, p 1362 (Macdonald). 557. Exhibit A, p 589. 558. Exhibit TAE – Tcpt, 1 March 2017, pp 1366-1367 (Macdonald). 559. Exhibit TP – Tcpt, 20 February 2017, p 868 (Gibson). 560. Exhibit TAE – Tcpt, 6 March 2017, p 1655 (Macdonald). 561. Exhibit TAE – Tcpt, 6 March 2017, pp1654-1656 (Macdonald). 562. Exhibit TAE – Tcpt, 6 March 2017, p 1656 (Macdonald). 563. Exhibit A, p 633. 564. Exhibit A, p 634. 565. See Exhibit A, pp 668-687 for all letters of support provided as part of this application. 566. Exhibit A, p 693. 567. Exhibit TAE – Tcpt, 2 March 2017, p 1372 (Macdonald). 568. Exhibit TI – Tcpt, 14 February 2017, p 462 (Mullard); Exhibit JM-1 (Tabs 2-8). 569. Exhibit TP – Tcpt, 20 February 2017, p 892 (Gibson). 570. Exhibit A, p 755. 571. Exhibit A, p 755. 572. Exhibit TAE – Tcpt, 7 March 2017, p 1691 (Macdonald). 573. Exhibit TAE – Tcpt, 7 March 2017, pp 1690-1691 (Macdonald). 574. Exhibit A, p 754. 575. Tcpt, 7 October 2022, p 689 (Maitland). 576. Exhibit A, pp 759, 797A. 577. Exhibit A, p 805. 578. Exhibit IM-10. 579. Exhibit TP – Tcpt, 20 February 2017, p 880 (Gibson). 580. Exhibit TP – Tcpt, 20 February 2017, pp 880-881 (Gibson). 581. Exhibit TK – Tcpt, 16 February 2017, p 638 (Sheldrake). 582. Exhibit TAE – Tcpt, 2 March 2017, p 1375 (Macdonald). 583. Exhibit TAE – Tcpt, 7 March 2017, p 1692 (Macdonald). 584. Exhibit A, p 811. 585. Tcpt, 7 October 2022, p 694 (Maitland). 586. Tcpt, 7 October 2022, p 696 (Maitland). 587. Tcpt, 7 October 2022, p 697 (Maitland). 588. Exhibit A, p 761. 589. Exhibit A, p 809. 590. Exhibit TK – Tcpt, 16 February 2017 p 642 (Sheldrake). 591. Exhibit TAE – Tcpt, 7 March 2017, pp 1698-1699 (Macdonald). 592. Exhibit A, p 842. 593. Exhibit IM-11. 594. Exhibit A, p 842. 595. Exhibit TW – Tcpt, 21 February 2017, pp 985-987 (Bartlett). 596. Exhibit A, p 840. 597. See Exhibit IM-9. 598. Exhibit TY – Tcpt, 22 February 2017, p 1059 (Derrig). 599. Exhibit TW – Tcpt, 21 February 2017, p 994 (Bartlett). 600. Exhibit TW – Tcpt, 21 February 2017, p 1001 (Bartlett). 601. Exhibit TY – Tcpt, 22 February 2017, p 1061 (Derrig). 602. Exhibit TY – Tcpt, 22 February 2017, p 1055 (Derrig). 603. Exhibit A, p 845. 604. See Edwards v The Queen (1993) 178 CLR 193; [1993] HCA 63. 605. Exhibit TR – Tcpt, 22 February 2017, p 1043 (Rees). 606. Exhibit TR – Tcpt, 22 February 2017, p 1046 (Rees). 607. Tcpt, 21 September 2022, p 338 (Rees). 608. Tcpt, 21 September 2022, p 339 (Rees). 609. Tcpt, 21 September 2022, p 340 (Rees). 610. Tcpt, 21 September 2022, p 342 (Rees). 611. Tcpt, 21 September 2022, p 354 (Rees). 612. Exhibit TAE – Tcpt, 7 March 2017, p 1706 (Macdonald). 613. Exhibit A, p 848. 614. Exhibit IM-4. 615. Exhibit A, pp 856-859. 616. Exhibit A, p 855A. 617. Exhibit TAE – Tcpt, 7 March 2017, p 1715 (Macdonald). 618. Exhibit A, p 856. 619. Exhibit A, p 856. 620. Exhibit A, p 858. 621. Exhibit TP – Tcpt, 20 February 2017, p 898 (Gibson). 622. Tcpt, 14 September 2022, p 219 (Mullard). 623. Exhibit TAE – Tcpt, 1 March 2017, p 1367 (Macdonald). 624. Exhibit TAE – Tcpt, 1 March 2017, pp 1511-1512 (Macdonald). 625. See also Exhibit JM 1 (Tab 2 – Tab 8). 626. Exhibit A, p 590. 627. Tcpt, 12 September 2022, pp 138-139 (Iemma). 628. Exhibit TP – Tcpt, 20 February 2017, p 889 (Gibson). 629. Exhibit TAE – Tcpt, 6 March 2017, p 1588 (Macdonald). 630. Exhibit A, p 466. 631. Exhibit TAE – Tcpt, 3 March 2017, pp 1537-1538 (Macdonald). 632. Exhibit A, p 474; p 468. 633. Tcpt, 27 September 2022, p 374 (Buffier). 634. Exhibit TAE – Tcpt, 1 March 2017, p 1348 (Macdonald). 635. Tcpt, 14 September 2022, p 189 (Mullard). 636. Tcpt, 14 September 2022, p 186 (Mullard). 637. Tcpt, 14 September 2022, p 228 (Mullard); see, also, Exhibit IM-13 which makes reference to possible time frames for expressions of interest. 638. Tcpt, 20 September 2022, p 321 (McPherson). 639. Tcpt, 10 October 2022, p 821 (Lewis). 640. Exhibit TI – Tcpt, 8 March 2017, pp 187-188, 189 (Mullard). 641. Exhibit A, p 270. 642. Exhibit X, p 18. 643. Exhibit A, p 450. 644. Exhibit A, pp 453, 456. 645. Exhibit A, p 456. 646. Exhibit A, p 454. 647. Exhibit A, p 456. 648. Exhibit A, pp 443-444. 649. Exhibit JM-1 (Tabs 2-8). 650. Exhibit A, p 754. 651. Exhibit TAE. 652. Tcpt, 4 October 2022, p 431 (Maitland). 653. Tcpt, 4 October 2022, p 433 (Maitland). 654. Exhibit A, p 146. 655. Exhibit A, p 133. 656. Exhibit A, p 134. 657. Exhibit A, p 134. 658. Exhibit TZ – Tcpt, 23 February 2017, p 1069 (Chisholm). 659. Exhibit A, p 134. 660. Exhibit A, pp 146-148. 661. Exhibit TZ – Tcpt, 23 February 2017, p 1084 (Chisholm). 662. Tcpt, 4 October 2022, p 434 (Maitland). 663. Tcpt, 10 October 2022, p 832 (Poole). 664. Tcpt, 10 October 2022, p 831; Tcpt, 12 October 2022, p 872 (Poole). 665. Tcpt, 12 October 2022, p 875 (Poole). 666. Tcpt, 12 October 2022, p 885 (Poole). 667. Tcpt, 12 October 2022, p 885 (Poole). 668. Exhibit A, pp 152-153. 669. Exhibit A, pp 155-157. 670. Exhibit A, pp 182-187C. 671. Exhibit A, p 199. 672. Exhibit A, p 201. 673. Tcpt, 5 October 2022, p 560 (Maitland). 674. Tcpt, 7 October 2022, p 706 (Maitland). 675. Exhibit A, p 205. 676. See, for example, Tcpt, 4 October 2022, p 480 (Maitland); Tcpt, 5 October 2022, pp 502, 537 (Maitland). 677. Exhibit A, p 205. 678. Exhibit A, p 220A. 679. Exhibit A, p 223. 680. Exhibit A, p 227. 681. Exhibit A, p 148. 682. Exhibit A, p 236D. 683. Exhibit A, p 236D. 684. Tcpt, 5 October 2022, p 533 (Maitland). 685. Exhibit A, p 242. 686. Exhibit A, p 677. 687. Exhibit A, p 678. 688. Tcpt, 5 October 2022, p 538 (Maitland). 689. Exhibit A, pp 300-307. 690. Exhibit A, pp 300-302. 691. Tcpt, 5 October 2022, p 547 (Maitland). 692. Exhibit A, p 301. 693. Tcpt, 5 October 2022, pp 497, 537-538 (Maitland). 694. Exhibit AE, p 5. 695. Exhibit A, p 345. 696. Exhibit A, p 345. 697. Exhibit A, pp 346, 357. 698. See Tcpt, 5 October 2022, p 559 (Maitland). 699. Tcpt, 5 October 2022, p 560 (Maitland). 700. Tcpt, 5 October 2022, p 558 (Maitland). 701. Exhibit A, p 380. 702. Exhibit AE, par 15. 703. See Exhibit A, p 470. 704. Exhibit AE, par 5. 705. Exhibit TAF – Tcpt, 9 October 2017, p 740 (Ireland). 706. Tcpt, 12 October 2022, p 877 (Poole). 707. Tcpt, 4 October 2022, p 454 (Maitland). 708. Tcpt, 4 October 2022, p 454 (Maitland). 709. Exhibit A, pp 396-397. 710. Exhibit A, pp 411-413. 711. See Exhibit A, p 468. 712. Exhibit A, p 489. 713. Exhibit AE, p 56 (p 29 of the draft proposal). 714. Tcpt, 5 October 2022, p 567 (Maitland). 715. Exhibit A, pp 420-422. 716. Exhibit A, p 437. 717. Tcpt, 6 October 2022, p 615 (Maitland). 718. Tcpt, 6 October 2022, p 615 (Maitland). 719. Tcpt, 6 October 2022, pp 621-622 (Maitland). 720. Exhibit A, p 499. 721. Tcpt, 6 October 2022, p 630 (Maitland). 722. Exhibit A, p 501. 723. Tcpt, 6 October 2022, p 631 (Maitland). 724. Exhibit A, p 525. 725. Exhibit A, p 525. 726. Exhibit A, pp 587-588. 727. Tcpt, 6 October 2022, p 620 (Maitland). 728. Exhibit A, pp 537-540. 729. Exhibit A, p 534. 730. Tcpt, 6 October 2022, p 635 (Maitland). 731. Exhibit TJ – Tcpt, 14 February 2017, p 536 (Coutts). 732. Exhibit A, p 540E. 733. Exhibit TAD. 734. Tcpt, 6 October 2022, p 639 (Maitland). 735. Tcpt, 6 October 2022, p 641 (Maitland). 736. Tcpt, 6 October 2022, p 644 (Maitland). 737. Exhibit A, pp 590A-590B. 738. Tcpt, 6 October 2022, pp 650-651. 739. Exhibit TX – Tcpt, 22 February 2017, p 1021 (Tudehope). 740. Exhibit A, p 590. 741. Exhibit A, p 611. 742. Exhibit A, p 618. 743. Tcpt, 12 October 2022, pp 906-907 (Poole). 744. Exhibit A, p 631A. 745. Exhibit A, p 740A. 746. Tcpt, 4 October 2022, pp 459-460 (Maitland). See also Tcpt, 10 October 2022, p 808 (Lewis). 747. Tcpt, 4 October 2022, p 474 (Maitland). 748. Tcpt, 12 October 2022, p 916 (Poole). 749. Tcpt, 12 October 2022, pp 914-916 (Poole). 750. Tcpt, 12 October 2022, p 915 (Poole). 751. Tcpt, 4 October 2022, p 463 (Maitland). 752. Tcpt, 4 October 2022, p 464 (Maitland). 753. Exhibit A, p 485. 754. Tcpt, 7 October 2022, p 744 (Lewis). 755. Tcpt, 4 October 2022, p 466 (Maitland). 756. Tcpt, 6 October 2022, p 649 (Maitland). 757. Tcpt, 4 October 2022, p 436 (Maitland). See, also, Tcpt, 7 October 2022, p 735 (Lewis). 758. Exhibit AD. 759. Mr Maitland was a director of the family company until November 2016 and as at 2 February 2009, held one of three issued shares. 760. Tcpt, 4 October 2022, p 469 (Maitland). 761. Tcpt, 4 October 2022, p 472 (Maitland). 762. Exhibit AD. 763. Tcpt, 7 October 2022, p 743 (Lewis). 764. Tcpt, 12 October 2022, p 889 (Poole); Tcpt, 10 October 2022, pp 807-808 (Lewis). 765. Tcpt, 10 October 2022, pp 808-809 (Lewis). 766. Tcpt, 4 October 2022, p 474 (Maitland). 767. Exhibit AD. 768. Tcpt, 4 October 2022, p 434 (Maitland). 769. Exhibit A, pp 750-752. 770. Exhibit A, p 751. 771. Exhibit A, p 862. 772. Tcpt, 12 October 2022, p 914 (Poole). 773. Exhibit A, p 622B. 774. Tcpt, 6 October 2022, p 660 (Maitland). 775. Exhibit A, p 627. 776. Exhibit A, p 628. 777. Exhibit A, p 631. 778. Exhibit A, pp 693-694. 779. Tcpt, 6 October 2022, p 660 (Maitland). 780. Tcpt, 7 October 2022, p 685 (Maitland). 781. See Tcpt, 7 October 2022, p 685 (Maitland). 782. Tcpt, 7 October 2022, p 683 (Maitland). 783. Exhibit A, p 798. 784. Exhibit A, p 802A. 785. Exhibit A, p 802A. 786. Tcpt, 7 October 2022, p 691 (Maitland). 787. Exhibit A, p 866I. 788. Tcpt, 5 October 2022, p 567 (Maitland). 789. See, for example, Tcpt, 7 October 2022, pp 674, 691 (Maitland). 790. See article at Exhibit A, pp 501-502. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 20 December 2022