Land and Environment Court New South Wales Medium Neutral Citation: Martin & Ors v Hume Coal Pty Ltd (No. 2) [2015] NSWLEC 1550 Hearing dates: 18 September 2015 Date of orders: 23 December 2015 Decision date: 23 December 2015 Jurisdiction: Class 8 Before: Dixon C Decision: The Court orders: (1) Dismiss the plaintiffs' application to set aside the order for costs made on 13 November 2015. (2) The costs order made on 13 November 2015 is affirmed. (3) The plaintiffs are to pay the defendant's costs of this application. Catchwords: COSTS – mining – exploration licence - meaning of the phrase 'rights conferred by the licence' in s31(1) of the Mining Act 1992 – whether the 'rights conferred by the licence' in s31 are extended by the terms of the conditions attached to the licence - including a right to access the surface of the land by vehicle to carry out prospecting and/or prospecting operations - whether identified improvements are 'other valuable works' and thereby are 'significant improvements' under s31(1) Legislation Cited: Evidence Act 1995 (NSW) Land and Environment Court Act 1979 (NSW) Mining Act 1992 (NSW) Courts and Crimes Legislation Further Amendment Act 2008 (NSW) Civil Procedure Act 2005 (NSW) Uniform Civil Procedure Rules 2005 (NSW) Workplace Injury Management and Workers Compensation Act 1988 (NSW) Cases Cited: Martin & Ors v Hume Coal Pty Ltd [2015] NSWLEC 1461 Category: Costs Parties: Peter Martin (Applicant 1) Phillip Pollicina (Applicant 2) Fesen Pty Ltd (Applicant 3) Ross Alexander (Applicant 4) Kathleen Roche (Applicant 5) Hume Coal Pty Limited (Respondent) Representation: Counsel: Robert White (Applicants) Amy Knox (Respondent) Solicitors: Marylou Potts Pty Ltd (Applicants) Sparke Helmore Lawyers (Respondent) File Number(s): 80405 of 2015 Introduction 1. On 13 November 2015 I handed down my reasons for judgement in respect of the resolution of disputes between the parties said to arise under s 31(1) Mining Act 1992 (Mining Act) in Martin and others v Hume Coal Pty Ltd [2015] NSW LEC 1461( the s31 proceedings). 2. By summons, filed on 12 May 2015, the plaintiffs sought orders and declarations from the Court that particular improvements on the surface of their land were either "dwelling - houses, gardens or significant improvements" within the meaning of the Mining Act, and as such operated so as to prevent Hume from exercising any rights conferred by its licence over the surface of the land including accessing any of the proposed drilling sites by vehicle. 3. After dismissing the summons I ordered the plaintiffs to pay the defendant's costs of the proceedings unless within 14 days from the date of my orders the plaintiffs applied to the Registrar to relist the matter for the hearing of argument as to costs. 4. The plaintiffs have taken up that opportunity and last Friday I heard their application to set aside the order for costs made on 13 November 2015. The parties' competing oral and written submissions are outlined below. The plaintiffs' position 1. Put simply, the plaintiffs' seek an order that each party bear their own costs of the s31 proceedings (at [1] plaintiffs' outline written submissions on costs dated 14 December 2015 (PS)). They contend, as the s31 proceedings concern disputes arising in the arbitration hearings that s152 (1) of the Mining Act requires that each party should pay its own costs. 2. They submit that the wording of s 152 (1) is mandatory and not discretionary. There can be no order that the plaintiffs' pay the defendant's cost. 3. The text of s152 (1) states: 152 Costs (1) Each party to the hearing is to bear his or her own costs in relation to the hearing. (2) The arbitrator's costs in relation to the hearing are to be borne by the holder of the prospecting title. (3) Payment of the arbitrator's costs in relation to a hearing is, for the purpose of any security given by the holder of a prospecting title, taken to be an obligation under the title. 1. The plaintiffs' submit that the effect of s 152 (1) of the Mining Act is to remove the otherwise broad discretion as to costs conferred on this Court by s 98 of the Civil Procedures Act 2005 (NSW) (CPAct) so that the Court has no power in these proceedings to make any order for costs (other than an order that each party bear its own costs). 2. According to the plaintiffs' interpretation 'the hearing' referred to in s152 (1) is a reference to the arbitration hearing convened under Div 2 of Pt 8 of the Mining Act. The disputes, the subject of the s 31 proceedings, arose in the arbitration hearing so the plaintiffs contend that their determination by this Court is an integral and fundamental part of that hearing. The findings of this Court in relation to these disputes are decisive to the outcome of each arbitration hearing. They are binding on the arbitrator. 3. It is further submitted that if the Court were to have determined the disputes in the plaintiffs' favour or any one of them, there would be no access arrangement granted, or, at least, a very limited one (PS [10]). The plaintiff's submissions rely upon my acceptance of the proposition that the disputes resolved by this Court pursuant to s 31 (5) form part of the arbitration hearing as defined by s 152 (1). 4. The plaintiffs draw a comparison between the costs position in s152 of the Mining Act and the provisions of the Workplace Injury Management and Workers Compensation Act 1998 and the Worker Compensation Regulation 2003 wherein it states that the parties to court proceedings for work injury damages are to bear their own costs. In support of this proposition I am referred to the Court of Appeal's reasoning in Smith v Sydney West Area Health Service (No 2) [2009] NSWCA 62, at [14] wherein the Court held: "the effect of the WIM Act and the WC Reg is that the discretion conferred by the Civil Procedure Act, s98 does not operate, and costs are governed by the WIM Act and the WC Reg." (PS at [11]). 5. Similarly, in this case costs under the statutory scheme are governed by the Mining Act not s98 of the CPA or the Uniform Civil Procedure Rules (PS at [12]). 6. That hearing process under the Mining Act is summarised in the PS at [8] in the following way: (1) an arbitrator must hold a hearing;(2) the arbitrator determines the terms of an access arrangement following a hearing;(3) where a dispute arises in a hearing as to the application of s31 , the Court is to determine that dispute;(4) the findings of the Court are reported to the arbitrator and the findings will determine the terms of the access arrangement, if any , made by the arbitrator; and (5) each party bears his or her own costs in relation to the hearing. The defendant's position 1. The defendant submits that s 152(1) has no application to proceedings in the Court commenced by summons pursuant to s31 (5) of the Mining Act or otherwise. Therefore, s152 (1) does not affect this Court's powers under s 98 of the CPAct, and the plaintiffs have put forward no satisfactory reason why the Court should depart from the general rule set out in rule 42.1 of the Uniform Civil Procedure Rules 2005 (NSW). 2. The reference to 'the hearing' in s 152(1) is a reference to the hearing the arbitrator must conduct pursuant to s 145(3), continued, if relevant, pursuant to s 150(4). It is not a reference to any hearing of the Court. Section 152 sets out the scheme when addressing the costs of arbitration and the provision for payment (by the explorer) of the arbitrator's costs in relation the hearing. The defendant submits that as the word 'hearing' is prefaced "the", it is clear that there is one hearing identified in s 152(1) being the arbitration hearing identified and described in the preceding sections of the Division. 3. The defendant contends that the plaintiffs' characterisation of the s 31(1) proceedings commenced in the Court as an integral and fundamental part of the arbitrator's hearings is simply incorrect (PS [10]). 4. The plaintiffs in this instance elected to commence the s 31 proceedings before all of the arbitrations had concluded. The defendant submits that there was nothing compelling them to do this; rather, they could have waited until the arbitrations had been finalised and then, if necessary, included any alleged incorrect application of the section 31 (1) by the arbitrator in the s 155 review proceedings. 5. The hearing before the arbitrator under ss 145 (3) and 154 is very different in terms of procedure and attendant costs to a hearing in Court pursuant to s 31(5). 6. Court proceedings necessarily involve higher costs than arbitration under the Mining Act. In support of this proposition the defendant refers the Court to s146 (2) of the Mining Act which prohibits legal representation at an arbitration hearing unless all parties consent and the arbitrator grants leave. This must be compared with a party's right to legal representation in the Court pursuant to s 63 of the Land and Environment Court Act 1979 (NSW) and Rule 7.1 of the Uniform Civil Procedure Rules. Another example of the differences is found in s148(2) which requires the arbitrator to act according to equity, good conscience and the substantial merits of the case but without regard to technicalities or legal forms. By way of contrast the rules of Court and the Evidence Act 1995 (NSW) govern the conduct of the proceedings in this Court pursuant to s 31 (5). 7. The defendant submits at DS [10] that the arbitration process set out in Div 2 of Pt 8 of the Mining Act reflects the legislature's intention to create a "non-legalistic system of arbitration" (New South Wales, Legislative Assembly, Parliamentary Debates, 9 May 1989 at 7658, the second reading speech for the Mining Act (Access to land) Bill 1989 (NSW) which was inserted as Pt 4A in the Mining Act 1973 (NSW). These provisions were re-enacted as Div 2 of Pt 8 of the Mining Act 1992). 8. The defendant submits that the Mining Act does not constrain the Court's costs discretion in the present circumstances despite expressly doing so in respect to small-scale titles in s 236G (6) and 236H (7). Had the drafters of the Mining Act intended to constrain this Court's costs discretion they would have expressly done so. They did not. 9. The defendants contend that the Court should not accept the plaintiffs' construction of s 152(1) because it is at odds with legislative history which supports the defendant's construction. Prior to the Court being vested with the jurisdiction under s 31(5) (and under s 155) these matters were dealt with by the Wardens Court. Costs of all proceedings before a warden were in the discretion of the warden: s317 of the Mining Act now repealed (DS at [12]). The reallocation of that authority to this Court by the Courts and Crimes Legislation Further Amendment Act 2008 (NSW) does not, without specific amendment, change the cost consequences of bringing proceedings in this Court. Particularly, when this Court has broad costs discretion pursuant to s 98 of the CP Act (at DS at [11] - 12]). 10. Finally, the defendants submit that there can be no comparison between the cost regime under the Workplace Injury Management and Workers Compensation Act 1988 (NSW) (WIM Act) and the Mining Act. The plaintiff's submission at PS [12] that these provisions are in anyway similar to s 152 of the Mining Act is inaccurate. Section 346 of the WIM Act expressly and unambiguously displaces the ordinary cost powers and rules in court proceedings. 11. Section 346(1) explicitly states that it is applicable to "court proceedings". Section 152 (1) says nothing about costs of court proceedings under the Mining Act; much less manifests an intention to displace s 98 of the CP Act. 12. In the ultimate, the defendants submit that the Court should confirm its order of 13 November 2015 that the plaintiffs pay the defendant's costs together with the further order that defendant' costs of this application. Consideration 1. I do not accept that the dispute resolved by the Court pursuant to s 31(5) forms part of the arbitration "hearing" as defined by s 152 (1). I agree with the defendant's interpretation of the Mining Act as explained in their written submissions at DS in particular at [5] – [15] 2. I find that Section 152(1) has no application to proceedings in this Court, whether commenced pursuant to s 31(5) of the Mining Act or otherwise. 3. The hearing referred to in s 152 is the arbitration hearing process outlined in Div 2 of Pt 8 of the Mining Act. 4. The plaintiffs decision to bring the s31 (1) disputes proceedings to the Court for determination under s31 (5) is an election which invokes the rules of this court and any relevant cost consequence. The Mining Act in this instance does not affect the Court's powers under s 98 of the CP Act (unless for good reason to depart from the general rule set out in rule 42(1) of the Uniform Civil Procedure Rules 2005 (NSW)) to order that the costs follow the event. 5. Unlike the arbitration hearings, the plaintiffs were legally represented by counsel at the s31 Court hearing and the rulings of evidence, quite properly, played an appropriate part in the proceedings. The plaintiffs sought declarations and findings in respect of the interpretation of the Mining Act together with determinations in respect of dwelling- houses, gardens and significant improvements. The Court travelled to the plaintiffs' properties to inspect the surface of the land and items or features the subject of the s31 (1) proceedings (noting that the view was also had for the s155 proceedings scheduled after the s31 judgment). I then spent four days of Court time hearing the proceedings, a large part of which was occupied by addressing objections to the admission of affidavit evidence as well as case law on the interpretation of certain words within s31(1) to ascertain their meaning. The Court then, after the conclusion of the evidence, considered the parties competing written submissions. 6. Ultimately, the plaintiffs did not make out their case. They were unsuccessful on all legal issues raised by them. And, while Hume made some concessions in respect of the proposed access routes during the s 31 proceedings, when compared to the access routes under review in the arbitration hearing these concessions may well have been made at the arbitrations or the pending s155 review proceedings. In my opinion, it was not necessary to bring the separate s31 (5) proceeding in order to arrive at the concessions referred as these matters were not the main disputes before the Court. 7. I am not satisfied that the concessions referred are sufficient reason to displace the general rule set out in rule 42.1 of the Uniform Civil Procedure Rules 2005 (NSW) as those concessions did not avoid an otherwise lengthy and legalistic hearing before the Court. The plaintiffs' main dispute concerned the interpretation of the meaning of s 31(1), and the term "rights conferred by the licence" certain claimed significant improvements after a determination of the meaning of that phrase. 8. The plaintiffs relied upon lengthy affidavits and expert evidence in the s31 proceedings. Hume necessarily responded to the claims brought and the plaintiff's evidence by preparing equally long affidavit and expert evidence. I do not believe that the plaintiffs have provided sufficient reason in to justify a departure from the usual costs rule. Hume should not be required to bear its cost of successfully defending its legal entitlement to explore the plaintiff's land in accordance with any final access arrangement. 9. I cannot accept Mr White submission that the Court's determination of the s 31 proceedings is an integral part of the arbitration hearing in the sense put. Certainly, any finding of the Court would be relevant to the arbitration hearing if it were not finalised by the time of the decision. However, the Court hearing is as the defendant's submit a fundamentally different process given the procedure for arbitration set out under the Mining Act and the rules of this Court. 10. The plaintiffs in this case could have elected to have their final access arrangements determined and appealed those determinations to the court under s 155 and at that time agitated the subject matter of the s 31 proceedings. Instead, they elected to pursue resolution of these disputes through the Court process, independent of the arbitration hearings, in the expectation that if successful that would be the end of the matter. They are entitled to take that course: the Mining Act offers that opportunity under s31 (5). However, in making that election they bear the risk of not achieving their end goal and the usual rules as to costs will apply unless good reason is proffered to justify a departure from that rule. 11. For the reasons that I have given I make the following orders: 1. Dismiss the plaintiffs' application to set aside the order for costs made on 13 November 2015. 2. The costs order made on 13 November 2015 is affirmed. 3. The plaintiffs are to pay the defendant's costs of this application. Susan Dixon Commissioner of the Court ********** 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: 24 December 2015