Land and Environment Court of New South Wales CITATION : Hodgson, Mark and Anor v Minister Administering the Water Management Act 2000, Namoi Catchment Management Authority and Director General Department of Natural Resources [2007] NSWLEC 478 APPLICANT Hodgson, Mark FIRST RESPONDENT PARTIES : Minister Administering the Water Management Act 2000 SECOND RESPONDENT Namoi Catchment Mangement Authority THIRD RESPONDENT Director General Department Natural Resources FILE NUMBER(S) : 41273 of 2006 CORAM: Talbot J KEY ISSUES: Practice and Procedure :- Effect of Practice Note requiring Statement of reasons for decision; Alternative directions for interrogatories, discovery and particulars. Practice and Procedure - consideration of conduct of representative action. Land and Environment Court Act, 1979 s 61F LEGISLATION CITED: Water Management Act 2000, ss 47 , 336 Supreme Court Rules, Pt 8, r 13 Carnie and Another v Esanda Finance Corporation Limited (1994-1995) 182 CLR 398; CASES CITED: Murrumbidgee Groundwater Preservation Association Inc v Minister for Natural Resources (2005) 138 LGERA 11 ; Public Service Board of NSW v Osmond (1986) 159 CLR 656; William J Whalley and Anor v The Commissioner of Police and Anor (NSWSC) Dunford J unreported, 7 April 2003 No.30012/03 DATES OF HEARING: 18/07/07, 30/07/07 DATE OF JUDGMENT: 1 August 2007 APPLICANT Mr Peter King (Barrister) SOLICITORS Lyons Barnett Kennedy LEGAL REPRESENTATIVES: RESPONDENTS Ms Allars (Barrister) SOLICITORS Crown Solicitors Office JUDGMENT: THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES Talbot J 1 August 2007 41273 of 2006 Hodgson Mark and Anor v Minister Administering the Water Management Act 2000, Namoi Catchment Management Authority & Director General Department Natural Resources Reasons for judgment 1 Talbot J: The applicants are rural property owners of land in the upper and lower catchment of the Namoi River. The first respondent is the Minister Administering the Water Management Act 2000 who purported to make a Water Management Plan (WMP) for each water management area in accordance with the provisions of Chapter 2, Part 3, Division 8 of the Act, being for the sharing, use and control of ground water sources in the Borambil Valley near Quirindi. 2 The original plan was made in 2003 and an amendment order in 2006. The applicants are seeking orders to the general effect that the WSP and the amendment order were made in breach of the Water Management Act. They are also seeking declarations that the first and second respondents have failed to comply with requirements of the Act and that actions taken by them are void and of no effect. 3 In this matter and in matters No. 41292 of 2006 and 40049 of 2007 the applicants are seeking an order by way of direction that the respondents file and serve an affidavit setting out the reasons for the decisions which are specified in the Schedule to the proposed orders and a direction that they identify documents, if any, which record the matters relevant to various decisions. 4 Section 47(1) and (4) of the Water Management Act provide a limit on jurisdiction as follows:- 47 Validity of management plans and exercise of plan-making functions (1) The validity of a management plan may not be challenged, reviewed, quashed or called into question before any court in any proceedings, other than before the Land and Environment Court in proceedings commenced within the judicial review period. (4) Without limiting subsection (1), the exercise by a designated person of any plan-making function may not be: (a) challenged, reviewed, quashed or called into question before any court in any proceedings, or (b) restrained, removed or otherwise affected by any proceedings, other than before the Land and Environment Court in proceedings commenced within the judicial review period. 5 Section 336 confers jurisdiction and provides that any person may bring proceedings in this Court for an order to remedy or restrain a breach of the Act or the Regulations whether or not any right of the person has been or may be infringed by or as a consequence of the breach. 6 The primary argument has centred on the challenge in this matter but the parties recognised that the outcome will have a corresponding effect in the other two matters. 7 The Schedule to the proposed orders which the applicants are seeking contains reference to the following decisions: - 1. The decision of the Minister with respect to the making of the water sharing plan [WSP] for the Upper Namoi; 2. The decision of the Minister with respect to exhibiting the draft plan; 3. The decisions of the Respondents and each of them to enter into and work in partnership with or in consultation with the Commonwealth under the Achieving Sustainable Groundwater Entitlements programme with a view to resuming or reducing or otherwise affecting the water and water entitlements of the Applicants on the basis of history of extraction and not across the board cuts; 4. The decisions of the First and Second Respondent with respect to the establishment and appointment of (i) the regional verification committee for the Upper Namoi ; (ii) the GAA for the Upper Namoi (iii) the GAOC for the Upper Namoi (iv) the consultation process with irrigation farmers in the Upper Namoi; 5. The decisions of the First and Second Respondents if any with respect to: (i) the assessment of the recharge factor in the WSP; (ii) the establishment of a bulk access regime for Zone 1; (iii) the establishment of extraction limits in the WSP; (iv) the establishment of priorities between access licence holders in the WSP; (v) the ratio for resumption of the Applicants' water and water entitlements for the Upper Namoi and zone 1 in particular; (vii) the socio-economic impact of the proposals of the plan and the draft plan; 5. The decision of the Respondents or each of them as to any and if so what measure of compensation should be made available to irrigators in the zone 1 including the Applicants and each of them in connection with the resumption or reduction of their water and water entitlements. 8 During argument the 2 items numbered 5 have been deal with sequentially as 5.1 and 5.2. 9 Essentially the applicants' counsel Mr King draws upon the provisions of the Court's Practice Note – Class 4 Proceedings, cll 14 and 15 which state: - Provision of information in judicial review proceedings 14. Where the proceedings involve a challenge to the decision of a public body or public official: (a) the respondent public body or public official is to make available to the other party or parties the documents it says record matters relevant to the decision, within 14 days of that respondent's appearance; (b) the Court may, at a directions hearing, direct the respondent public body or public official to furnish to the other party or parties within a specified time, a statement in writing setting out the reasons for the decision including findings on material questions of fact referring to the evidence or other material on which those findings were based, the body's or person's understanding of the applicable law and the reasoning processes leading to the decision; (c) otherwise in appropriate cases, the Court may, at a directions hearing, make orders for the matters in (b) to be ascertained by way of particulars, discovery or interrogatories. 15. Orders for formal discovery and interrogatories will only be made in exceptional cases and such orders will then generally be confined to particular issues. 10 The provisions in clauses 14 and 15 in this Court's Practice Note are derived from Practice Note 119 which relates to proceedings in the Administrative Law List in the Supreme Court. 11 Practice Note 119 does not contain a corresponding provision to paragraph 14(a) of the Practice Direction in this Court and specifically mentions that any direction in terms of 14(b) is contemplated "because of the difficulties which at times arise in ascertaining the decision making process and the reasons for the decision". 12 Discovery has already taken place. Interrogatories have been administered and answered while the respondents have also provided answers to a request for further and better particulars. Mr King says, that the responses by the respondents to date in respect of the above mentioned interlocutory processes are inadequate. Moreover, further interrogatories are proposed. 13 The decisions in respect of which the present directions are being sought other than No.1 in the Schedule appear to relate to steps in the process leading up to the ultimate decision to make a WSP. For example there is reference to the public exhibition of the Draft Management Plan pursuant to s 38, which appears to be the subject of decision No. 2 in the Schedule. Moreover, the respondents contend that a number of the decisions are irrelevant to the claim. There is no allegation of a decision in the Points of Claim that answers the description in No. 3 and in any event the respondents have not acted jointly or in concert with the Commonwealth. The Points of Claim do not specify a challenge to the decision referred to in No. 4. The claim to which the decision in No. 5.2 is referable is not being pursued at this point in the litigation. Ms Allars who appears for the respondents, notes that the apparent separate decisions referred to in No. 5.1 are all part and parcel of the one decision to make the plan. 14 It appears to me that the applicants have been seeking to engage the operation of the Practice Note beyond its objective. Although there are difficulties in understanding the claim that arises from the Points of Claim, it seems that the applicants are proceeding on the basis that each step or decision made during the process should be the subject of a separate judicial review rather than just the ultimate decision of the Minister. Furthermore, the Points of Claim make broad allegations of breach in some cases without adequate particulars and in other cases make an allegation of breach in the particulars rather than as a separate ground. 15 Without attempting to fully consider the rationale of the Points of Claim the issue in relation to whether or not the Court should make the orders that the applicants have been seeking is more easily resolved. The statement of the secondary alternatives in paragraphs 14(c) and 15 of the Practice Note makes it clear that the intent of paragraph 14(a) and (b) is to simplify the proof of the decision making process and the reasons for the decision. That objective does no disservice to the general rule at common law that there is no requirement for an administrative decision maker to give reasons for a decision (Public Service Board of NSW v Osmond (1986) 159 CLR 656). The intention of the Practice Note is to seek a statement of reasons in order to facilitate the determination of the issues in respect of the alleged breach (see William J Whalley and Anor v The Commissioner of Police and Anor (NSWSC) Dunford J unreported, 7 April 2003 No.30012/03). 16 In my view, the "reasons" referred to in 14(b) of the Practice Note are intended to be the reasons for the ultimate decision. It is anticipated by paragraph 14(a) that documents recording matters relevant to the decision will be produced. Paragraph 14(b) anticipates that findings on material questions of fact will be elucidated. That is not a requirement that the reasons behind each interlocutory step are to be contained in a separate statement. Paragraph 14(c) recognises the prospect of the alternative orders when it refers to "otherwise in appropriate cases". The warning in paragraph 15 takes account of the difficulties anticipated by the Supreme Court when drawing Practice Note No. 119. 17 I have already adverted to an easier solution to the current problem. That is because Justice Lloyd when making orders for particulars, interrogatories and discovery has already pre-empted the necessity to comply with paragraphs 14(a) and (b). However I am now informed that the interrogatories made to date do not directly address the reasons for the decisions. 18 The outcome as a consequence of adequate answers to any requests for further and better particulars, the making of discovery and proper answers to relevant interrogatories should achieve the same result as that contemplated by 14(a) and (b) of the Practice Note. Particularly in circumstances where there are difficulties in ascertaining the decision making process. Irrespective of whether that is the case here the interlocutory steps of particulars, discovery, and, to a limited extent interrogatories, have been taken. If there is any shortcoming following the completion of that process, the applicants have remedies available to them which can be pursued by appropriate notice of motion seeking further orders. Leave to make further specific interrogatories would be one option. 19 Nevertheless, some consideration should be given to drawing the Points of Claim in such of a way that the allegations of breach of the Act are stated in a clear and concise manner with appropriate particulars. 20 What I have said above does not conflict with my understanding of the observations made by the Chief Justice in Murrumbidgee Groundwater Preservation Association Inc v Minister for Natural Resources (2005) 138 LGERA 11 at [36] as follows: - [36] Furthermore, allegations of impropriety of this kind cannot be left to mere inference on the basis of so narrow a foundation as the fact that only one management committee had been established in the State. Whether by way of discovery or subpoena or by way of interrogatories or by way of seeking an interlocutory order from the Court directing the Minister to file an affidavit as to the matters he took into consideration in formulating the Plan or failing or refusing, if that be the case, to appoint a management committee to formulate a management plan, the Appellant could have, but did not, lay a factual foundation for its case. There was no evidence as to the Minister's motive for pursuing the course he did, either with respect to the Lower Murrumbidgee Groundwater Management Area or more generally. There is no proper basis for an inference that that motive was improper. 21 The processes that the Chief Justice contemplated would have overcome the problems experienced by the applicant in the Murrumbidgee case. They have already been taken or can be extended in this case. Any defect or lack of adequate response by the respondents can, if necessary, be dealt with in an appropriate manner. 22 I am satisfied that full and complete discovery, provision of adequate responses to any request for further and better particulars and answers to interrogatories should provide the applicants with such evidence that exists to support their case. Matters have progressed far beyond the point where paragraph 14 of the Practice Note has any further relevance. Moreover I do not construe the Practice Note as seeking to elucidate anything except the actual decision the subject of the proceedings. In this case generally speaking the relevant decisions appear to be the making of the WSP and the subsequent decision to make an amended plan. 23 However, I do not find that the reasons for the making of any decision by the Minister, and possibly the committee, are not relevant pieces of evidence. I reject any suggestion that because a decision is made by an administrative body or is of legislative nature, and therefore there is no duty to give reasons, means that evidence of the reasons for whatever is done is not relevant. 24 In the circumstances I do not propose to make orders and directions in the context of the Practice Note as proposed by the applicants. However I have made orders in respect of further interrogatories provided they comply with Part 24 rule 1 of the former Supreme Court Rules which still apply in this Court. The parties have accepted the timetable for completion of discovery as it is reflected in orders made by me on 18 July 2007 in matters No.'d 40049 of 2007 and 41292 of 2006. 25 The applicants also seek orders requiring the first and second respondents to file and serve an affidavit explaining alleged breaches of orders made on 16 May 2007. The orders required them to respond to a letter seeking particulars of the decisions within 14 days. The fact is that the letter was responded to albeit in terms that were not to the satisfaction of the applicants. Whether affidavit evidence is required in such circumstances is entirely a matter for the Court, in the context of the management and control of its own procedures. However, having regard to the whole of the circumstances I do not require the first and second respondents to provide such evidence. There was a response. I do not agree that the answer to the request was inappropriate, generally for the reasons set out above, and particularly as the respondents were at the same time the subject of other interlocutory orders in relation to the same information. 26 Finally the first and second respondent contend that they are entitled to be made aware of the names of the individuals who are applicants in the proceedings and their addresses for service and a schedule listing the names and residential addresses of the individuals who are represented by any applicant specifying which applicant is the representative. 27 Reference is made to Part 8 Rule 13 of the former Supreme Court Rules which applies and provides in sub rules (1) and (2) as follows: - (1) Where numerous persons have the same interest in any proceedings the proceedings may be commenced, and, unless the Court otherwise orders, continued, by or against any one or more of them as representing all or as representing all except one or more of them; (2) At any stage of proceedings pursuant to this rule the Court, on the application of the plaintiff, may appoint any one or more of the defendants or other persons (as representing whom the defendants are sued) to represent all, or all except one or more, of those persons in the proceedings. 28 In the Application Class 4 the applicants refer variously to "the applicants and/or farmers with aquifer access" "compensation… for the purpose of paying farmers and the Applicants" "farmers in zone 1" and "the interests… of water users in zone 1". The application also seeks directions with respect to such representative procedure as to the Court seems fit. The Points of Claim make further relevant references to the interests of third parties such as "other farmers in a similar position" "farmers and their families in zone 1" "at the cost of farmers" and again "the interests… of water users in zone 1". Moreover s 336(1) and (4) of the Water Management Act anticipates the prospect of proceedings being brought on behalf of third parties as follows: - 336 Restraint of breaches of this Act (1) Any person may bring proceedings in the Land and Environment Court for an order to remedy or restrain a breach of this Act or the regulations. (2)… (3)… (4) Any such proceedings may be brought by a person on the person's own behalf or on behalf of another person (with their consent), or of a body corporate or unincorporate (with the consent of its committee or other controlling body), having like or common interests in those proceedings. 29 In Carnie and Another v Esanda Finance Corporation Limited (1994-1995) 182 CLR 398, the High Court held that Part 8 Rule 13 is to be applied having regard to purpose of facilitating parties having the same or similar interest to achieve a result in one set of proceedings rather than by the commencement of multiple actions. 30 Mr King refers the Court to the notice approved by Gillard J in the Supreme Court of Victoria to identify those group members able to maintain a claim in the proceedings as it is set out in Appendix 11 to D. Grave and K. Adams, Class Actions in Australia, Lawbook Co. 2005. It is not necessary for me to do other than note the reference at this stage. In answer to the foreshadowed request for an order to identify the names of the individuals they represent the applicants have filed an affidavit sworn by the Solicitor for applicants on 26 July 2007 wherein he confirms the name and address of each of the three applicants and that the representative group which the first applicant represents are each of the Water Access Licence Holders in Zone 1 of the Upper Namoi Water Management Area as at the date of the Water Sharing Plan the subject of the challenge in the proceedings the names and addresses of whom are said to be well known to the respondents. 31 An agreement has been reached between the parties that the matter will be referred for mediation by the Honourable Mr Michael McHugh AC QC. The respondents point to s 61F of the Land and Environment Court Act as a relevant consideration for the Court in determining specifically who are the individuals that the first applicant represents. The section provides that the costs of mediation are to be borne by the parties to the proceedings in such proportion as they may agree among themselves or failing agreement in equal shares. 32 The lack of detailed legislative prescription by statute or rule of court regulating the incidents of class action was the subject of regret pressed by the High Court in Carnie. Nevertheless that was not perceived as a reason for narrowing the scope of the operation of Part 8 Rule 13 without giving effect to the purpose of the Rule in facilitating the administration of justice. Brennan J at p 408 adopted the reasoning of Toohey and Gaudron JJ and agreed with McHugh J that " the test for determining whether an action is within the scope of Pt 8, r 13(1) is whether the plaintiff and the members of the represented class have a community of interest in the determination of some substantial issue of law or fact". 33 The filing of the abovementioned affidavit by the solicitor has provided some measure of clarity in relation to the nature of the interest and the class of individuals who the first applicant purports to represent. Ms Allars has given notice during submissions that the first and second respondents require further clarification and will be seeking orders to achieve this end. They also want to engage judicial control of the process to ensure that the litigation is conducted in an efficient manner as between the applicants and the respondents. 34 The Court is also interested to ensure that concerns identified by Brennan J in Carnie at p 408 regarding the interests of those who are absent as at p 408, be addressed. 35 The respondents will be directed to file any Notice of Motion seeking further orders in respect of the representative action together with supporting material by 6 August 2007. The Notice of Motion, if any, will be returnable before Lloyd J on 16 August 2007. 36 All matters are listed for further mention before Justice Lloyd 14 August 2007. 37 The exhibits may be returned. 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.