MATTER : An application pursuant to s102 of the Mining Act 1978 (as amended)

An application for a Writ of Certiorari against the Warden of Mines at Perth, G N Calder Esq SM

Mining law - Mineral lease - Application for exemption - Mineral lease one of a group included within a "project area" by Department of Mines for purposes of exemption from expenditure - Whether lease "comprised within a project" - "Project" includes a mineral exploration project, a mining project or a combination of both - "Project" involves a plan or scheme without requiring a fixed plan or timetable for work on each tenement involved

Administrative law - Prerogative writs and orders - Certiorari - Jurisdictional error - Whether Warden exercising jurisdiction of an inferior court or an administrative tribunal error of law regarding meaning of project constituted jurisdictional error

Mining Act 1978 s102, s115A

Danagher v Racing Penalties Appeal Tribunal (1995) 13 WAR 531

Westside Mines Pty Ltd v Tortola Pty Ltd [1985] WAR 343

1 MALCOLM CJ: This was the return of an order nisi for a writ of certiorari made by the Hon Justice Miller on 24 November 1998 by which, as amended by leave of this Court, it was relevantly ordered that:

"The abovenamed Warden, or any person interested, do show cause before the Full Court of this Honourable Court why a Writ of Certiorari should not issue against the said Warden to remove into this Court for the purpose of being quashed his decision made 22 May 1998 whereby he recommended that the Application for Exemption No 282/967 by St Barbara Mines Limited and Golden Shamrock Mines Limited be refused, on the grounds that:

(1) (a) The Warden erred in law in deciding that the term 'project' in Section 102(2)(h) of the Mining Act involves the actual implementation or carrying out of a plan or scheme in relation to each and every mining tenement comprised within the alleged project, and such error appears on the face of the record, alternatively, is a jurisdictional error.

(b) The Warden should have decided that there may be a 'project' for the purposes of Section 102(2)(h) of the Mining Act in respect of specified mining tenements notwithstanding that a plan or scheme has not been or is not being actually implemented or carried out in relation to one or some of those tenements."

2 The order nisi was also made on six other grounds. However, at the conclusion of the hearing on 22 April 1999 the Court was unanimously of the opinion that the applicants were entitled to have the order made absolute on the basis that ground (1) had been made out. Consequently, it was unnecessary to consider the remaining grounds.

3 As at 8 March 1995 the applicants were the holders of a large number of mineral leases granted pursuant to the Mining Act 1978 ("the Act"), including Mineral Lease M51/334 ( "M51/334" or "the subject lease"), which was granted on 5 October 1989 and in respect of which there was an annual expenditure commitment of $12,100 in the year ending 4 October 1996. The various mineral leases were grouped together. It appears that early in 1995 the Department of Minerals and Energy had recognised that the various mineral leases should be grouped into "five exploration project areas" in the Meekatharra-Cue region, "for the purposes of applying for exemption on a 'project' basis" under s102(2)(h) of the Act. The first of these areas was assigned the project name "Bluebird" and included 14 groups of mineral leases, one of which was designated Group No C61/1993 called "Nannine/Golden Shamrock". The subject mineral lease was included in that group. It was common cause that the Warden incorrectly placed the subject mineral lease in Group No C58/1993, the group name of which was "Bluebird/South Junction". In the result nothing turns on that error.

4 Earlier, in 1993, by letter dated 10 May 1993 the Director of the Mining Registration Division of the Department informed the Chairman of St Barbara Mines Ltd ("St Barbara"), among other things, that:

"The Department recognises that there are three separate exploration project areas for the purposes of applying for exemption on a project basis under Section 102(h) of the Mining Act 1978; Wanganui, Bluebird and Polelle.

Geological reporting can be on sub-groups within each of the separate project areas. This matter will be the subject of further discussion between Nick Winnall and Dr Ian Ruddock.

Applications for exemption under project status will be supported with a breakdown of actual expenditure on each of the tenements involved, as detailed in the attached information pamphlet."

5 Two additional project areas were subsequently added to the three referred to in that letter.

6 In relation to each of the mineral leases there were annual expenditure requirements specified pursuant to the Act. Section 102(1) of the Act provides that:

"Subject to this Act, on an application made, as prescribed, by the holder of a mining tenement (other than a retention licence) or his authorised agent prior to the end of the year to which the proposed exemption relates, or within the prescribed period after the end of that year, the holder may be granted a certificate of exemption in the prescribed form totally or partially exempting the mining tenement to which the application relates from the prescribed expenditure conditions relating thereto, in an amount not exceeding the amount required to be expended -

(a) in respect to any mining tenement other than a mining lease, in any one year; and

(b) in respect to a mining lease, subject to subsection (7) in a period of 5 years."

7 Section 102(7) provides that:

"Where the Warden finds that the reasons given by the holder of the mining lease are sufficient to justify the granting of a certificate of exemption and so recommends, or if the Minister is satisfied whether or not a recommendation is made by the Warden, the Minister may grant a certificate of exemption in an amount not exceeding the amount required to be expended in respect of the mining lease in the period of 5 years from the commencement of the year to which the application relates."

8 Section 102(2)(h) provides that:

"A certificate of exemption may be granted for any of the following reasons:

(h) that the mining tenement is comprised within a project involving more than one tenement, and that expenditure on a tenement or tenements comprised in that project would have been such as to satisfy the expenditure requirements in relation to the tenement concerned had that aggregate expenditure been apportioned in respect of the various tenements comprised in the project."

9 It was common cause that, assuming that the subject mineral lease was comprised within a "project" for the purposes of s102(2)(h), namely the Bluebird project, the requirements of s102(2)(h) were satisfied.

10 Section 102(5) provides that:

(a) where an objection to the application is lodged, shall be heard by the Warden in open court; but

(b) otherwise, shall be forwarded to the Minister for determination by the Minister."

11 Section 102(6) provides that:

"The Warden shall as soon as practicable after the hearing of the application transmit to the Minister for his consideration the notes of evidence and any maps or other documents referred to therein and his report recommending the granting or refusal of the application and setting out his reasons for that recommendation."

12 By an application for exemption No 282/967 dated 2 December 1996 the applicants made application for exemption in respect of the whole of the prescribed expenditure requirement for M51/334 for the year ended 4 October 1996. The amount of expenditure prescribed pursuant to reg31(1) of the Mining Regulations 1981 ("the Regulations") in respect of the subject lease was $12,100. The reason for seeking the exemption was stated in the application as follows:

"The mining tenements are comprised within a project involving more than one tenement and that expenditure on the tenements comprised in that project would have been such as to satisfy the expenditure requirements in relation to the tenements concerned had that aggregate expenditure been apportioned in respect of the various tenements comprised in the project. Further time is required to fully evaluate the tenements.

Applied for pursuant to Sections 102(2)(b), 102(2)(h) and 102(3) of the Mining Act 1978."

13 Reliance on s102(2)(b) was subsequently abandoned.

14 On 23 December 1996 an objection No 27/967 objecting to the grant of the subject application was lodged with the Registrar. The grounds for objection were:

"The licence [sic lease] has been active for 7 years, of which they have applied for exemptions for 6 of those years. They should have spent a minimum of 84,700 compared with the 17,675 spent, some years ago."

15 Further and better particulars of the objection were subsequently filed by the objector. In summary, those particulars claimed that the tenement holders had spent or claimed to have spent only $17,675 over 7 years when the aggregate minimum expenditure for that period was $84,700. It was said that the holder had obtained full exemptions for 5 of the previous 6 expenditure years and that a further exemption was not appropriate. The objector disputed that the tenement was comprised within a "project" for the purposes of s102(2)(h) of the Act. There are other grounds that are not presently relevant.

16 On 23 December 1996 the objector also lodged Plaint 14/967 seeking forfeiture of the subject lease on the ground of non-compliance with the prescribed expenditure condition in respect of the tenement for the year ended 5 October 1996. It was common cause that the relevant expenditure year for the subject lease ended on 4 October 1996. A defence to the plaint for forfeiture was lodged on 17 April 1997. With the consent of both parties, the hearing of the forfeiture plaint was adjourned by the Warden to a date to be fixed, pending his hearing and recommendation on the application for exemption.

17 There was in evidence before the Warden a departmental publication dated December 1996 entitled Policy Guidelines: Exemption from Expenditure Conditions ( "the Guidelines"). In relation to s102(2)(h), the Guidelines stated:

(2) definition of what constitutes aggregate expenditure; and

(3) evidence of 'progressive' exploration throughout all tenements comprising a project."

"There is no definition of 'project' under the Act, but for administrative reasons a 'project' means a group of contiguous mining tenements for which Ministerial approval has been provided under Section 115A(4) and the guidelines to submit a combined mineral-exploration report on a common reporting date. Such approval is given where the DGS, acting for the Minister, is satisfied that (under Note 20 of the Guidelines for Mineral Exploration Reports on Mining Tenements):-

(a) there is common exploration over the group and the group covers an area of a continuous geological unit or continuous zone of adjacent related geological units;

(b) the tenements are contiguous or nearly contiguous;

(c) previous reporting on all tenements is up to date; and

19 So far as "aggregate expenditure" is concerned, the Guidelines state:

"The policy makes a clear distinction between two kinds of expenditure;

(a) expenditure on mineral exploration/prospecting;

It is necessary to separate the two in any project that consists of tenements covering an active mining area surrounded by tenements covering an area of exploration activity. The intention of Sub-section 102(2)(h) is to allow provision for flexibility of exploration expenditure over a group of contiguous tenements. It is not reasonable to include the huge costs of mining development and production (often considerably greater than the level of exploration costs) in any exploration project, because this could then enable large areas of exploration/prospecting tenements to remain unworked with no effective exploration over long periods."

20 So far as "progressive exploration" is concerned, the Guidelines state:

"The policy is to ensure that individual tenements in large tenement groups are not left unworked for several years because of exemption under 102(2)(h). Computer monitoring of tenement groups (through the WAMEX system) allows the Department to assess expenditure histories of ALL tenements. Following assessment, conditions may be imposed on exemptions to ensure that expenditures on exploration activities are progressively moved around any particular tenement group."

21 Section 115A(2) of the Act imposes an obligation on the holder of a mining tenement to file a mineral exploration report, or cause a mineral exploration report to be filed:

"(a) in conjunction with an operations report in such circumstances as are set out in the guidelines; and

(b) whenever required to do so by the Minister by notice in writing."

22 In s115A(1) "guidelines" means guidelines published under the regulations. The Guidelines to which I have referred are "guidelines" for the purposes of s115A(2). The term "mineral exploration report" as used in s115A(2) is defined in s115A(1) as follows:

" 'Mineral exploration report' means a report containing the records of the progress and results of -

(a) programmes involving the application of one or more of the geological sciences;

(c) activities involving the collection and assaying of soil, rock, groundwater and mineral samples."

23 The evidence before the learned Warden was to the effect that during the year ended 4 October 1996 St Barbara employed 15 or 16 qualified geologists and between 50 and 60 drillers, owned and operated seven RC drilling rigs, owned and operated two RAB drilling rigs, owned and operated one air-core rig, and extensively assayed drill core samples, using its own employees engaged in its own laboratory. Evidence was given by a Mr Winnall, the exploration manager of St Barbara, who the Warden found was a qualified and very experienced geologist, that a large number of tenements within the Bluebird project occupied an area of about 40km in length. He said it was the practice of the applicants and would in the future continue to be the practice of the applicants to progressively explore between the known gold resources which had been discovered within the Bluebird project. He gave evidence that gold was being mined at the tenement known as Bluebird and that gold was being mined at Nannine. The distance between the two mines was 20km. The learned Warden accepted Mr Winnall's evidence and found that St Barbara had drilled various locations and in the manner described by Mr Winnall in his evidence between the Bluebird and Nannine locations. He found that seven RAB drill lines had been drilled and that in each of those lines, sample analysis had indicated anomalies. He found that one RAB drill line had been drilled on the subject tenement. This was done during the only year in which expenditure on that tenement was reported, namely the year ended 4 October 1993. The Warden also accepted Mr Winnall's evidence that one RAB drill line had been drilled 200 to 300m south of M51/334 and there had been some drilling, but not RAB lines, 3 to 4km north of the tenement. Mr Winnall did not indicate when such drilling had been carried out. It was found that St Barbara had discovered a significant gold deposit some 2.5km to the south of M51/334, namely, the "Caledonian" deposit.

24 The learned Warden also accepted the evidence of Mr Winnall to the effect that the tenements said to comprise the Bluebird project more or less followed the geological structures which he identified in the maps tendered in evidence. In particular, the learned Warden accepted that the Caledonian deposit was on a granite contact line which also passed through M51/334. Mr Winnall's evidence was to the effect that the applicant intended to continue to explore along that granite contact line. It was the intention of St Barbara to explore to the north-east and south of the subject mineral lease and it was hoped that the subject mineral lease would be "reached" within a year. He conceded that no work had been done on the subject mineral lease since the 1992/93 year. This was because of work commitments elsewhere on tenements owned by the applicants.

25 The learned Warden was satisfied that during the relevant year the applicants had expended, in respect of all the relevant mining leases, an amount which was not less than 70% of the total amounts of expenditure claimed, namely $38,916,898. This expenditure greatly exceeded the total statutory expenditure obligations in respect of the mining leases.

26 So far as the application under s102(2)(h) is concerned, the learned Warden said:

"The main thrust of the applicants' case was based upon the provisions of paragraph (h) of Section 102(2). The issues which arose arising out of the application of that paragraph were, firstly, whether or not M51/334 was 'comprised within a project involving more than one tenement', secondly, if there was a 'project' which included M51/334 what other tenements comprised that project, and thirdly, whether or not 'aggregate expenditure' for purposes of paragraph (h) could be made up by way of aggregation of expenditure on mining operations together with expenditure on activities which did not constitute 'mining operations' or whether, in assessing 'aggregate expenditure' it was a requirement of and the intention of the legislation that expenditure on 'prospecting' be separately identified and aggregated only with expenditure on 'prospecting' and that 'exploration' expenditure be identified and aggregated only with other 'exploration' expenditure and that, in similar fashion, expenditure on 'mining operations' only be aggregated with other expenditure on mining operations."

During the course of evidence reference was made to exhibit B, the 'policy guidelines' publication of the Department which Ms Pagel said reflected the views and policies of the Department in relation to the granting of exemptions. On page 4 of the policy guidelines next to paragraph number (2) appears the heading, 'Definition of what constitutes aggregate expenditure.' The guidelines then say, 'The policy makes a clear distinction between two types of expenditure:

(a) Expenditure on mineral exploration/prospecting;

It is necessary to separate the two in any project that consists of tenements covering an active mining area surrounded by tenements covering an area of exploration activity ... It is not reasonable to include the huge costs of mining development and production (often considerably greater than the level of exploration costs) in any exploration project, because this could then enable large areas of exploration/prospecting tenements to remain unworked with no effective exploration over long periods.'

Whilst I accept that that quoted passage does accurately reflect the policy which is applied by the Department in considering applications for exemption based upon Section 102(2)(h) I do not accept that Section 102(2)(h) should be interpreted in that way. It is my view that in the application of paragraph (h) it is not the intention of the legislation that any distinction be drawn between the type of expenditure or the type of tenement upon which the expenditure was expended for the purposes of assessing aggregate expenditure. It is of significance, in my opinion, that Regulations 15(1) (prospecting licences), 21(1) (exploration licences) and 31(1) (mining leases) all state that the expenditure shall be 'in mining' or in connection with 'mining' on the licence or lease.

'Mining' is defined very broadly in Section 8(1) of the Act and includes, inter alia, 'prospecting and exploring for minerals, and mining operations'. Further, paragraph (h) of Section 102(2) makes no reference expressly, or in my opinion, by implication, to any distinction between the types of tenements which may be included in a project, nor between the types of tenements or the types of expenditure which may be included in the aggregation of expenditure requirements. In addition, the term 'expenditure requirements' which is used in paragraph (h) is itself defined in Section 8(1) in terms which by virtue of the use of the words 'mining tenement' (itself defined in Section 8(1)) includes all types of tenements which may be granted under the Act.

To take the view that in no case could there be aggregation of expenditure on 'mining operations' together with expenditure on 'prospecting' or 'exploration' could produce an effect which could potentially completely negate the intended purpose of the paragraph. For example, if a tenement holder held only two or three tenements, one of which was being mined extensively and upon which large sums of money were being spent, the holder may have a bona fide reason for spending no money on the other two tenements which may, for example, be prospecting licences. The tenement holder may well have genuine and reasonable plans to, in the near future, prospect or explore or mine the other two tenements and have good grounds for not carrying out any work on those tenements during the year in question. If the three tenements themselves constituted a bona fide 'project' for the purposes of Section 102(2)(h) then to deny the tenement holder the capacity to 'aggregate' the total expenditure and then apportion it as is contemplated by paragraph (h) would mean that such a holder would never be able to rely upon the provisions of Section 102(2)(h) of the Act even though the situation of such a tenement holder would appear to be precisely the sort of situation at which the legislation is aimed.

For all of the above reasons it is my view that for purposes of Section 102(2)(h) the applicant in this case is entitled to aggregate the whole of the proved expenditure on mining operations and on exploration and prospecting on tenements which the evidence establishes do, together, compose a 'project' for purposes of Section 102(2)(h)."

27 In my opinion, the above approach was entirely correct. The learned Warden then went on to consider the meaning of the word "project" saying:

"The word 'project' is not defined in the Act or Regulations. It should therefore be given its ordinary, everyday meaning applied to the context in which it is used. In the Macquarie Dictionary (2nd Edition) at page 1410 'project' is defined as:

'1. Something that is contemplated, devised or planned; a plan; a scheme; an undertaking.'

In the Shorter Oxford Dictionary (3rd Edition) at page 1682 'project' is defined as:

'1. A plan, draft, scheme, or table of something; a tabulated statement, a design or pattern - 1627.

2. A mental conception or idea; speculation - 1727.

3. Something projected for execution; a plan, scheme, purpose; a proposal - 1601.'

Warden P Thobaven SM, in a decision given in the case of Western Gulf Oil and Mining Ltd, Southern Goldfields Ltd and Cord Holdings Ltd, (delivered at Perth 21 June 1994) concluded that a 'project' for purposes of Section 102(2)(h) involved the notion of 'planning'. The Warden said at page 12 of his reasons:

'After considering the use of the word 'project' I consider that before an activity can be classed as a 'project', it has to be demonstrated that it has the quality and concept of firmly based plans. That has to be differentiated from activities which are not properly planned, where money is spent on an ad hoc basis.'

I consider that 'project' in Section 102(2)(h) invokes the notion not only of a 'plan' or 'scheme' or 'undertaking' but that it invokes, in the context in which it is used, the notion that the implementation of or the carrying out of or the execution of the plan or scheme has commenced and is, in that sense, not merely an 'idea' or 'mental conception' or 'speculation' or plan with nothing more. Good intention coupled with a plan but nothing more would not amount to a 'project'. The capacity of the holder to finance and otherwise implement and manage or control the project may all be some of the factors which could go towards establishing that there was a bona fide 'project' for purposes of Section 102(2)(h)."

28 The learned Warden then referred to s115A and the decision of Warden Heaney in Australian Eagle Oil Co NL v Pawson and Cavern delivered on 12 January 1996 in which it was held that s115A of the Act, which was inserted by way of an amendment in 1994, subs(4) of which gave the Minister power to "approve of arrangements for combined mineral exploration reports to be filed for two or more mining tenements ..." had the effect that it was the Minister who had the power to confer "project" status on two or more tenements. In the present case the Warden noted at p20 of his reasons that evidence had been given before Warden Heaney that a senior geologist with the Department, Dr Ruddock, had said that for officers of the Department "project" meant:

"The reporting of a group of contiguous mining tenements that share a common exploration programme and the operator of that common exploration programme has to demonstrate that the common exploration programme for minerals covers an area of a continuous geological unit or a continuous zone of adjacent related geological units and there is a common ownership of tenements."

29 Warden Calder did not agree with Warden Heaney's analysis of the effect of s115A or the effect of the approval of arrangements by the Minister pursuant to s115A(4). In this case the learned Warden said at 21:

"The word 'project' does not appear in Section 115A. It was used in Section 102(2)(h) before the insertion into the Act of Section 115A. It had a meaning in the Act prior to the insertion of 115A and in my opinion, it continued to have the same meaning after the insertion of Section 115A. Its inclusion in the Act prior to 1994 meant that the Warden and the Minister for purposes of paragraph (h) had to ask what 'project' meant and whether in each case there was such a project within which the subject tenement was included. I can not see that Section 115A can be interpreted and applied in such a way as to now remove that role of the Warden on or to change the role of the Warden in any way."

30 The learned Warden went on to express the view that the potential for a concurrence of relevant factors in the application of the provisions of ss102(2)(h) and 115A(4) did not mean that neither the Warden nor the Minister was free to independently form a view, based on evidence or other material, whether or not a 'project' existed for the purposes of s102(2)(h) where the Minister had previously made a decision under s115A(4) approving of combined reporting arrangements. In this respect the learned Warden said:

"In my opinion the purpose of the introduction of the provisions of Section 115A(4) was to facilitate the gathering, analysis and publication of activities and results on mining tenements. It is not intended to provide a basis for the granting of an exemption. It is designed to assist both the Department and the tenement holder in the preparation of reports and it is designed to assist other persons who may be entitled to have access either to those reports or to publish material based upon an assessment and analysis of the reports."

31 In my opinion, the approach adopted in the Guidelines in the context of s115A and the provision grant of an exemption under s102(2)(h) reflects a clear intention on the part of Parliament that a "project" for the purposes of s102(2)(h) or 115A would include mineral exploration project, a project which involved the mining and production of minerals and a project which combined actual mining with ongoing exploration.

32 So far as the specific application for an exemption before him was concerned, the learned Warden said:

"In the present case the effect of the evidence of witnesses called on behalf of the applicant is, in effect, that the applicant, during the year in question and at the present time, has no more than an intention to 'eventually' commence mining operations or to 'eventually' explore or prospect M51/334 when the time and money which are available permit that to be done. This is not the same as saying that there is a 'project' which embraces M51/334 within the meaning of 'project' in Section 102(2)(h). Such an intention cannot, for the purposes of Section 102(2)(h) be said to amount to a 'plan, draft or scheme' to mine or explore or prospect the tenement. Despite the inclusion in the definition of 'project' in the Shorter Oxford Dictionary of 'mental conception or idea; speculation', that interpretation of the word 'project' is not an appropriate one for purposes of Section 102(2)(h); in my view there must be much more than a mere mental conception or idea or speculation.

In the present case the effect of the evidence of Mr Winnall in particular, but also that of Ms Oats, was such as to leave me with the impression that it was only when and if funds became available from the active mining operations of the applicant's productive tenements that any work would be done and expenditure incurred thereby in respect of M51/334 and, further, and significantly, that expenditure on 51/334 would only occur if the applicant decided that no other tenement ranked higher than M51/334 in terms of anticipated favourable results being received from expenditure. That is not a 'plan' or 'scheme' or 'purpose' or 'something contemplated' (Macquarie) in the sense in which it may be said to amount to a 'project' for purposes of Section 102(2)(h) which project includes M51/334.

There was no evidence of any real plan related to M51/334. Expenditure has been in the past and will in the future be directed only towards areas in respect of which the greatest expectation of favourable results is held. No evidence as to any expectation held on the part of the applicant concerning of [sic] M51/334 was given. No evidence was given of any analysis which was done of past drilling results on M51/334 from which it could be inferred that the tenement had been attributed any priority for the purposes of planned or even unplanned future expenditure. No real time-frame has been set within which the applicant intends to commit any expenditure to M51/334.

In all of the circumstances I am not satisfied on the evidence that there is a 'project' within which M51/334 is 'comprised' for purposes of Section 102(2)(h). That is not to say that I am satisfied that there is no project at all relating to some or even all other tenements within the Bluebird Group. It means however, that there is a single project involving all other such tenements, or if there are a number of separate projects within the tenements which make up the Bluebird Group, that M51/334 is not 'combined within' and [sic any] such single project or within any other of such separate projects. It is the absence of any true plan or scheme or design related to past or future expenditure on M51/334 which has the effect of excluding it from the concept of a project for the purposes of Section 102(2)(h)."

33 Because the term "project" in s102(2)(h) of the Act is not defined, it bears its ordinary meaning, namely a "plan", "scheme" or "undertaking". In the context of s102(2)(h) it is to be construed in a practical, commercial way and so as to include a mineral exploration project which involves an existing plan, scheme or undertaking for the exploration and/or mining of two or more tenements. The plan, scheme or undertaking may be formal or informal and may be amended or supplemented from time to time. It may contemplate the gradual and co-ordinated development of the relevant tenements progressively or sequentially. In my opinion, the evident purpose of s102(2)(h) is to enable a mining entity to invest substantial capital in mining or exploration of one or more of a group of mining tenements incorporated within a project without risk of forfeiture of other tenements in the project for non-compliance with the individual expenditure conditions otherwise applicable.

34 It was submitted on behalf of the applicants that at all material times the tenements comprised within the Bluebird project constituted a project for exploration and mining of all the tenements within the group for the purposes of s102(2)(h) in that:

(a) the tenements were contiguous and a granite contact line which evidently contained significant gold deposits passed through them;

(b) the applicants had an existing plan or scheme for the exploration and mining of the tenements;

(c) the plan or scheme was progressively to explore and mine the tenements, concentrating upon those areas which it was believed would produce a cashflow; and

(d) to that end, in 1995 and 1996 there were between 7 and 10 tenements within the Bluebird project which were being actively mined, whereas various other tenements, including M51/334 were not actively being mined.

35 The evidence of exploration showed that the granite contact line which was shown to be gold-bearing on either side of M51/334 inferred the potential existence of gold deposits in M51/334 itself. Mr Winnall gave evidence that the applicants intended to continue to explore along the granite contact line which would involve exploration of so much of it as was within the subject lease.

36 The interpretation of the term "project" in the context of the legislation raised a question of law: cf Collector of Customs v Pozzolanic Enterprises Pty Ltd (1993) 43 FCR 280 at 287. In my opinion, the learned Warden erred in law insofar as he held that the term "project" in s102(2)(h) involved the actual implementation, carrying out or execution of a plan or scheme which had been formulated specifically in relation to each and every mining tenement comprised within what the applicants contended to be the project.

37 In the result, the learned Warden expressed his recommendation in the following terms:

"For all of the above reasons, it is my recommendation to the Minister that the application for exemption be refused. In summary, I consider that the subject tenement is not within a 'project', in the sense that there is no real 'plan' for its future, other than to hold it for an unknown period until its 'priority' is deemed to be sufficient to justify further expenditure. The total actual expenditure in the past on the tenement viewed as a proportion of the total required expenditure is so small and the likelihood in the near future of there being compliance with the prescribed expenditure requirement is so little that I consider it appropriate that I recommend strongly against the holder being granted a further exemption."

38 I would accept that it is not enough simply to plan to hold a tenement in reserve merely on the basis that it would be worked when it becomes convenient to do so, as distinct from the basis of its relationship with the ore body or with other tenements which logically required it to be mined in the context of a planned sequence. Notwithstanding that there was not a fixed timetable or plan which showed precisely at what stage further exploration or mining would be carried out on the subject tenement, it was still possible for it to be regarded as part of the exploration and mining project which had been developed. The granite line had been identified as extending into the subject mining lease and beyond it to the south. In my opinion, it is this aspect of the evidence which demonstrates that the subject mineral lease was part of a project. In the context of s102(2)(h), the jurisdiction to grant a certificate of exemption is dependent upon the existence of the set of circumstances contemplated by s102(2)(h). The primary consideration which triggers the jurisdiction to grant the exemption is "that the mining tenement is comprised within a project involving more than one tenement ...".

39 The circumstances under which certiorari is available were authoritatively stated by the High Court in Craig v South Australia [1995] HCA 58; (1995) 184 CLR 163. Having identified the scope of certiorari at 175-176, Brennan, Deane, Toohey, Gaudron and McHugh JJ said at 176:

"Where the writ is sought on the ground of jurisdictional error, breach of procedural fairness or fraud, the superior court entertaining an application for certiorari can, subject to applicable procedural and evidentiary rules, take account of any relevant material placed before it ..."

40 Their Honours went on to consider what constituted "jurisdictional error" at 176-180. A clear distinction was drawn between, on the one hand, inferior courts which were amenable to certiorari and administrative tribunals. As to the first category their Honours said at 177:

"An inferior court falls into jurisdictional error if it mistakenly asserts or denies the existence of jurisdiction or if it misapprehends or disregards the nature or limits of its functions or powers in a case where it correctly recognises that jurisdiction does exist. Such jurisdictional error can infect either a positive act or a refusal or failure to act. Since certiorari goes only to quash a decision or order, an inferior court will fall into jurisdictional error for the purposes of the writ where it makes an order or decision (including an order or decision to the effect that it lacks, or refuses to exercise, jurisdiction) which is based upon a mistaken assumption or denial of jurisdiction or a misconception or disregard of the nature or limits of jurisdiction.

... Less obviously, an inferior court can, while acting wholly within the general area of its jurisdiction, fall into jurisdictional error by doing something which it lacks authority to do. If, for example, it is an essential condition of the existence of jurisdiction with respect to a particular matter that a certain event or requirement has in fact occurred or been satisfied, as distinct from the inferior court's own conclusion that it has, there will be jurisdictional error if the court or tribunal purports to act in circumstances where that event has not in fact occurred or that requirement has not in fact been satisfied even though the matter is the kind of matter which the court has jurisdiction to entertain. Similarly, jurisdictional error will occur where an inferior court disregards or takes account of some matter and circumstances where the statute or other instrument establishing it and conferring its jurisdiction requires that that particular matter be taken into account or ignored as a pre-condition of the existence of any authority to make an order or decision in the circumstances of the particular case. Again, an inferior court will exceed its authority and fall into jurisdictional error if it misconstrues that statute or other instrument and thereby misconceives the nature of the function which it is performing or the extent of its powers in the circumstances on the particular case. In the lastmentioned category of case, the line between jurisdictional error and mere error in the exercise of jurisdiction may be particularly difficult to discern. (See, eg. R v Dunphy; Ex parte Maynes [1978] HCA 19; (1978) 139 CLR 482; R v Gray; Ex parte Marsh [1985] HCA 67; (1985) 157 CLR 351 at 371; Public Service Association (SA) v Federated Clerks Union [1991] HCA 33; (1991) 173 CLR 132)."

41 In the present case there is a question whether, in proceedings before the Warden where there is an objection to the application for exemption and the role of the Warden is to hear the application and transmit to the Minister for consideration the notes of evidence etc and his report recommending the grant or refusal of the application and setting out his reasons for that recommendation, he is exercising the jurisdiction of the Warden's Court as an inferior court or is performing an administrative function and acting as an administrative tribunal. If the former, it would seem to me that it is an essential condition of the existence of jurisdiction under s102(2)(h) that the mining tenement the subject of the application for exemption" is comprised within a project involving more than one tenement" and that the expenditure on another tenement or other tenements comprised in the project was such as to satisfy the requirements on the application of the balance of para (h). Alternatively, the circumstances set out in s102(2)(h) constituted such a pre-condition of the existence of any authority to grant an exemption. In such circumstances, an error of law regarding the existence or otherwise of the pre-condition would be a jurisdictional error.

42 Alternatively, the Warden's Court as an inferior court would exceed its authority and fall into jurisdictional error if it misconstrued s102(2)(h) and, the meaning of "project" in particular, so that it misconceived the extent of its powers in the circumstances of the particular case. In this context it is of some significance that s102(3) confers power on the Minister to grant a certificate of exemption for any reason other than those set out in s102(2) "which may be prescribed or which in the opinion of the Minister is sufficient to justify such exemption".

43 In Craig v South Australia at 179 their Honours contrasted the position of an administrative tribunal with that of an inferior court by what was referred to at 179 as "a critical distinction which exists between administrative tribunals and courts of law". Their Honours went on to say at 179:

"At least in the absence of a contrary intent in the statute or other instrument which established it, an administrative tribunal lacks authority either to authoritatively determine questions of law or to make an order or decision otherwise than in accordance with the law. That point was made by Lord Diplock in Re Racal Communications Ltd [1980] UKHL 5; [1981] AC 374 at 383:

'Parliament can, of course, if it so desires, confer upon administrative tribunals or authorities power to decide questions of law as well as questions of fact or of administrative policy; but this requires clear words, for the presumption is that where a decision-making power is conferred on a tribunal or authority that is not a court of law, Parliament did not intend to do so.'

The position is, of course, a fortiori in this country where constitutional limitations arising from the doctrine of the separation of judicial and executive powers may preclude legislative competence to confer judicial power upon an administrative tribunal. If such an administrative tribunal falls into an error of law, which causes it to identify a wrong issue, to ask itself a wrong question, to ignore relevant material, to rely on irrelevant material or, at least in some circumstances, to make an erroneous finding or to reach a mistaken conclusion, and the tribunal's exercise or purported exercise of power is thereby affected, it exceeds its authority or powers. Such an error of law is jurisdictional error which will invalidate any order or decision of the tribunal which reflects it."

44 In Ex parte Warwick John Flint, unreported; SCt of WA; Library No 960320; 3 July 1997 Parker J at 4 raised the question whether the Warden was "an inferior court" in the sense that concept was understood in Craig v South Australia. In Flint the Warden was exercising jurisdiction pursuant to s98 of the Act under which the ultimate function of the Warden was to make a recommendation to the Minister. In that case, on the assumption that the Warden was exercising the jurisdiction of an inferior court, Parker J regarded it as arguable that by statutory prescription the scope of the record was widened to include the notes of evidence, the report and recommendation of the Warden, each of which the Warden was required to forward to the Minister by virtue of s98(6) of the Act. Section 102(6) is to the same effect. If, therefore, the Warden was acting as an inferior court, I agree that it was arguable that because the Warden was required to prepare a report recommending the granting or refusal of the application and to set out his reasons for that recommendation and transmit them to the Minister, it might well be said that the report, at the least, constituted part of the relevant record because that is what he was required to send to the Minister and which the Minister was required to consider. In this case it was not contended that the notes of evidence and any maps or other documents formed part of the record, but only the contents of the report. If the report and recommendation constituted the record, the error of law which I have identified is one which appeared on the face of the record. The same result would follow if only the recommendation, being the equivalent of the formal judgement or order of the court, was held to be the record. I note that by s128 of the Act the "warden's court" is "a court of record". However, the jurisdiction of the court as set out in s129 does not include the hearing of an objection to an application for an exemption or any other hearing following which the Warden is required to make a report and recommendation to the Minister, or any application to the Warden for the grant of a prospecting licence under s42 of the Act. All of this suggests that the jurisdiction being exercised by the Warden under s102 was that of an administrative tribunal, rather than the jurisdiction of an inferior court of record: cf Re Minister for Mines, Fuel and Energy; Ex Parte Trythall (1991) 7 WAR 375 at 389-391 per Murray J; and Hazlett v Rasmussen [1973] WAR 141 at 146 per Wickham J; and Wade v Burns [1966] HCA 35; (1966) 115 CLR 537 at 551 per Barwick CJ. In my opinion, however, it is not necessary to express any concluded view on the question for the purposes of this case. Whether the Warden was sitting as an inferior court or as an administrative tribunal, a jurisdictional error was established. In either case, certiorari was available. The learned Warden's recommendation is one to which regard must be had by the Minister and it has a discernible legal effect upon the Minister's exercise of discretion: Hot Holdings Pty Ltd v Creasy (1996) 185 CLR 149 at 165 and 172-175 per Brennan CJ, Gaudron and Gummow JJ.

45 It was for these reasons that at the conclusion of the hearing on 22 April 1999 I joined in the making of the order of the Court that:

1. The order nisi in this case should be made absolute and the decision of the learned Warden be quashed on the return of the writ without further order of the Court on the ground that the learned Warden erred in law in deciding that the term "project" in s102(2)(h) of the Mining Act 1978 involves the actual implementation of a plan or scheme in relation to each and every mining tenement comprised within the alleged project and such error was a jurisdictional error.

2. The learned Warden should have decided that there may be "project" for the purposes of s102(2)(h) of the Mining Act 1978 in respect of specified mining tenements notwithstanding that a plan or scheme has not been or is not actually being implemented or carried out in relation to one or some of those tenements.

3. The applicants' application for exemption No 282/967 from the expenditure provisions relating to mining lease M51/334 be remitted to the learned Warden according to law.

46 PIDGEON J: I agree with the reasons to be published by the Chief Justice.

47 IPP J: I have read the reasons to be published by the Hon the Chief Justice. I agree with them and his Honour's conclusions. I have nothing further to add.