Falzon v Gladstone Ports Corporation & Anor [2012] QPEC 50

[2] The Project is described in the Coordinator-General's report[4] in these terms:-

"The Commonwealth and Queensland Governments have identified Gladstone as a port with the potential to service large scale export orientated, resource processing and valuated industries. The close proximity of Gladstone's international port facilities is essential to the economic viability of the Gladstone State Development Area (GSDA). The GSDA aims to attract industries by offering internationally competitive operating costs and has the capacity to accommodate significant future industrial growth.

Gladstone Ports Corporation Ltd (GPC) is responsible for the provision and maintenance of shipping facilities and navigable channels, swing basins and berth pockets in the port. It is the proponent for this Project, which is proposed to accommodate the long-term dredging and dredged material disposal that is required to provide safe and efficient access to the existing and proposed Gladstone Western Basin port facility (in Port Curtis, from Auckland Point to The Narrows). In particular the Project would serve the emerging liquefied natural gas (LNG) industry in the Gladstone region. ..."

[3] Upon the expiry of the period for public submissions the Coordinator-General prepared a report evaluating the EIS pursuant to s 35(3)[5]. Section 54B of the Act allows the Coordinator-General to impose conditions and to nominate the entity to have a jurisdiction for those conditions. The Coordinator-General imposed conditions[6] and nominated the entity with jurisdiction for each condition. The conditions relevant to this application are Condition 20 and Condition 21 and in each case DEEDI is the entity with jurisdiction for those conditions[7].

Condition 20 - "GPC must mitigate all reasonable financial losses to existing commercial fishing operators attributable to the Maritime development in the Western Basin of the Port of Gladstone. That is to cover temporary and permanent loss of access to fishing areas and marine fish habitat."

Condition 21 - "GPC must meet any costs associated with the investigation, negotiation and administration of any compensation package, including all costs incurred by DEEDI in the management of development or (sic)[8] any compensation package."

The Chief Executive Officer of DEEDI is the entity with jurisdiction for these conditions.

(1) A proceeding mentioned in the Sustainable Planning Act, section 456(1) or (2) can not be started in relation to the Project.

(2) However, a person mentioned in section 54F(2) may bring a proceeding in the Planning and Environment Court for a declaration about whether there has been substantial compliance with an imposed condition for the undertaking of the Project.

(3) The court has jurisdiction to hear and decide the proceeding.

(4) The Sustainable Planning Act, sections 456(7) and 457 apply to the proceeding as if it were a proceeding under section 456 of that Act.

(5) The court may, in deciding what orders it is to make in the proceeding, have regard to 1 or more of the following -

(a) the laws and policies applying when the condition was imposed;

(c) the Coordinator-General's report for the EIS and any

Coordinator-General's change report for the Project;

(i) the imposed conditions for the undertaking of the Project; or

(f) any environmental management plan required under the condition;

(g) any other matter the court considers relevant."

[6] Section 54F(2) referred to in s 54G(2) above relevantly provides:-

"54F Provision about enforcement orders under the Sustainable Planning Act

(2) Despite the provisions mentioned in subsection (1)(a), only the following persons may bring the proceeding -

(e) someone else whose interests are significantly adversely affected by the subject matter of the proceeding."

[7] The reference in s 54G(1) to the Sustainable Planning Act (SPA) s 456(1) or (2) is to the court's power to make declarations and the reference in s 54G(4) to ss 456(7) and 457 deal respectively with court's power to make orders about any declarations made and the court's power to award costs.

[8] It can be seen then that the court's jurisdiction is founded on the establishment of two bases. Firstly that the party seeking the declaration and any other order must be "significantly adversely affected by the subject matter of the proceeding" within s 54F(2)(e) and secondly any declaration must be in relation to substantial compliance with an imposed condition for the undertaking of the Project within s 54G(2).

[9] The applicant in the main proceeding, the respondent in the present applications, (Falzon) represents himself and 58 individuals, some of which (unidentified) are said to be class members, of the classes as hereinafter described.[9]

[10] The basis of the representative action is said to be that the term commercial fishing operators in Condition 20 at all material times included:-

(a) Commercial fishermen, including trawlers and live trout fishes;

(d) Suppliers of bait, tackle, parts, services and marine craft;

(e) Retailers and suppliers of marine craft, bait, tackle and parts; and or

who operate a business that is engaged in, is reliant upon other businesses engaging in, or enables other businesses to engage in, the catching of fish or other seafood from the Gladstone Harbour.[10] The pleading does not disclose which of those categories Falzon and the other 58 parties belong to.

[11] Broadly speaking the declarations and orders sought are these:-

1. A declaration pursuant to s 54G(3) of the Act that there has not been substantial compliance by GPC with Condition 20 in that it has failed to mitigate the reasonable financial losses to existing commercial fishing operators attributed to dredging in the western basin by failing to:-

(a) Take sufficient steps to investigate whether the emergence since April 2001 of signs or symptoms of disease in fish, crabs, prawns and sharks fished in the waterways in the Gladstone Harbour is attributable to the dredging activities of the Project;

(ii) Supplies of bait, tackle, parts, services and marine craft;

(iii) Retailers or suppliers of marine craft, bait, tackle and parts; and/or

I note this declaration does not refer to a failure to negotiate with:-

(a) Commercial fishermen including trawlers and live trout fishes;

(a) Conducts a monitoring programme that monitors the levels of:-

(vii) In the waters within a 100 m of all dredging activities undertaken as part of the Project.

(b) Take any other steps necessary to determine as conclusively as possible whether the emergence of signs or symptoms of disease in fish, crabs, prawns and sharks fished in waterways in the Gladstone Harbour is attributable to the dredging activities;

(c) Provide Falzon and the above class members the results of the above monitoring programme and any other investigation within two business days of the receipt of those results.

(d) Pay the legal fees and outlays incurred by the applicant and the Class Members incurred to obtain the above orders.

2. That GPC and DEEDI negotiate a Compensation Package with Falzon and the following Class Members who operate a business that is engaged in, reliant upon other businesses engaging in, and enables other businesses to engage in the catching of fish or other seafood from the Gladstone Harbour:-

(a) Commercial fishermen, including trawlers and life trout fishes;

(d) Suppliers of bait, tackle, parts, services and marine craft;

(e) Retailers and suppliers of marine craft, bait tackle and part; and or

and that the GPC pay the legal fees and costs incurred by Falzon and the above Class Members in obtaining the above orders.

[12] In summary the grounds founding the relief sought are these:-

(b) The term "commercial fishing operators" in Condition 20 includes:-

(i) Commercial fishermen, including trawlers and life trout fishes;

(iv) Suppliers of bait, tackle, parts, services and marine craft;

(v) Retailers and suppliers of marine craft, bait tackle and part; and or

(c) The duty to mitigate in Condition 20 was owed to Falzon and the above Class Members and obliged GPC to investigate whether a financial loss incurred by those commercial fishing operators was attributable to the dredging activities and to negotiate a Compensation Package with Falzon and the Class Members;

(d) In or around April 2011 there have been signs or symptoms of disease in the marine biota fished from the waterways in and around Gladstone Harbour and the reputation of that fish product has been damaged;

(e) Between 16 September 2011 and 7 October 2011 the Gladstone Harbour was closed to fishing causing the applicant and the Class Members to suspend or cease operation of their businesses resulting in financial loss;

(f) There is a risk that dredging activities have caused the mobilisation of sediment in the water column and the oxidation of metal compounds in the sediments;

(g) As a result of the above the water in and around the dredging activity have extremely low pH values for natural waters, elevated concentrations of dissolved metal compounds and reduced concentrations of oxygen;

(h) As a result of the above the marine biota has become stressed, susceptible to a range of diseases, sick and have signs or symptoms of disease to the extent that seafood caught from the Gladstone Harbour has become known as being sick or diseased from a known or unknown disease.

(i) To determine whether or not the financial losses suffered by Falzon and the class members were attributable to the dredging activities it was and is necessary for GPC to have conducted and to continue to conduct a monitoring programme that monitors the levels of:-

In the waters within a 100 m of dredging activities.

(j) GPC has failed to conduct a Monitoring Programme or otherwise determine whether the signs or symptoms of disease in marine biota is attributable to the dredging activities thus depriving itself of information it would otherwise have obtained to enable it to assess whether financial losses were attributable to the dredging activity.

(k) The GPC has failed to substantially comply with its obligation to investigate whether the financial losses above referred to are attributable to the dredging activities.

(l) GPC has refused to negotiate a compensation package with the Class Members namely:-

(ii) Suppliers of bait, tackle, parts, services and marine craft;

(iii) Retailers and suppliers of marine craft, bait, tackle and parts; and/or

(m) As a result of GPC's failure to investigate and negotiate as above outlined it has failed to substantially comply with Condition 20.

(i) Investigate whether the emergence of signs or symptoms of disease in fish, crabs, prawns and sharks fished in waterways in the Gladstone Harbour is attributable to the dredging activities undertaken as part of the Project;

(iii) Take any other steps to determine whether the emergence of signs or symptoms of disease in fish, crabs, prawns and sharks fished in waterways in the Gladstone Harbour is attributable to the said dredging activities and;

(iv) Negotiate a Compensation Package with Falzon and the class Members.

[13] GPC relies upon four grounds to support a strike out of the pleading:-

(a) It is founded on an erroneous construction of the term "existing commercial fishing operators" in Condition 20;

(b) It fails to properly plead necessary standing Falzon and the 58 parties he purports to represent given that, unless a party is an existing commercial fishing operator within Condition 20, that party cannot be "significantly adversely affected by the subject matter of the proceedings" (Act s 54F(2)(e));

(c) It is not a proceeding about whether there has been substantial compliance with an imposed condition within s 54G(2) and on a proper construction of Condition 20; and

(d) It is premature because, even assuming the interpretation, assuming everything else in favour of Falzon, the time for compliance with Condition 20 has not yet arrived and the pleading contains no allegation that the process undertaken by DEEDI (the entity with jurisdiction concerning Condition 20) has failed or has come to a conclusion.

Meaning of term "existing commercial fishing operators" in Condition 20

I have set out already those classes of persons Falzon asserts fall within the term commercial fishing operators in Condition 20. At the risk of repetition, they are:-[11]

(e) Commercial fishermen, including trawlers and live trout fishes;

(h) Suppliers of bait, tackle, parts, services and marine craft;

(i) Retailers and suppliers of marine craft, bait, tackle and parts; and/or

who operate a business that is engaged in, is reliant upon other businesses engaging in, or enables other businesses to engage in, the catching of fish or other seafood from the Gladstone Harbour.

[14] QPC says the term existing commercial fishing operators is neither ambiguous nor uncertain and refers to an existing commercial operator who actually engages in the activity of fishing, including crabbing. The use of that term in Condition 20 is a reference to licensed commercial fishing operators who fished commercially in the Project area as at the date of the Coordinator-General's report. It submits that, for that term to be expanded to all the other categories contended for by Falzon would involve the term extending to people not engaged in the activity of fishing. That interpretation would extend it to almost any business with any connection with commercial fishing operations, however indirect, whether or not the business was itself engaged in such operations. To determine the parameters of the class of such persons it would be very difficult if not impossible to ascertain, leading to uncertainty in its operation and absurdity in its consequences. Given that the meaning of existing commercial fishing operators contended for by Falzon is central to the pleaded case and relief sought, on that ground alone, it is said, the entire pleading should be struck out.

[15] Falzon argues that the term commercial fishing operators refers to all operators of businesses that form part of the fishing industry or the fishery at Gladstone Harbour and relies upon the Oxford English Dictionary definition of fishery as:

"1. The business, occupation or industry of catching fish, or of taking other products of the sea or rivers from the water."

In response to GPC, Falzon says there are three reasons why his wider interpretation of the term commercial fishing operators should be accepted. They are:-

It is consistent with the plain meaning of all sentences in Condition 20.

(a) The last sentence of Condition 20 makes it plain that the purpose of that Condition is to compensate those businesses that suffer financial loss as a result of loss of productive fishing zones in the Gladstone Harbour. The sentence referred to reads:-

"This is to cover temporary and permanent loss of access to fishing areas and marine fish habitat.";

(b) The EIS confirms that purpose in Appendix F - Stakeholders and Community Consultation Report[12] where it is stated:-

Table 4 below provides a list of the key issues/concerns raised throughout the consultation program and a cross-reference to the relevant section/s of the terms of reference.

Need to consider monetary compensation/buy-out due to impacts from loss of productive areas. The government could consider closing off the whole

Harbour area to commercial fishing and providing appropriate compensation."

(c) GPC has not identified any reason why businesses that "catch" seafood would be any more impacted from the loss of productive fishing areas in the Gladstone Harbour than businesses that sell or process the caught seafood or businesses that supply the fishing equipment used to catch the seafood. If there are no fish to catch, there are no fish to sell or process and there are no businesses to supply with fishing equipment.

(d) Given that Condition 20 has as its purpose to compensate businesses whose livelihood was affected by temporary and permanent loss of access to fishing areas and marina fish habitat, it is arbitrary to limit the businesses to which Condition 20 applies to only those businesses that derived a profit from direct physical connection to the fishing areas and marine fish habitat. This is especially so, Falzon argues, given that the businesses that catch fish would not be commercial fishing operators but would simply be recreational fishing operators if there were no businesses in the fishing industry that sell and derive a profit for the entire seafood industry from the caught fish;

(e) GPC has failed to give any reason as to why it is said that the broader interpretation of the term contended for by Falzon would lead to difficulty in ascertaining members of the class because the pleading itself identifies with certainty the members of the class of persons Condition 20 intends to protect.

[16] Further, Falzon says that businesses only fall within the class of commercial fishing operators if they have suffered "reasonable financial losses ... attributable to the maritime development."[13] That is, GPC owes a duty to mitigate the financial losses of a business that sells fish only if that business suffered that loss as a result of the maritime development. If the connection between the businesses in the fishing industry and the act of catching fish is as tenuous as GPC submits, the businesses could not have suffered any financial loss as a result of the loss of fishing zoned attributable to the marine development

[17] The second reason Falzon relies upon to answer GPC's argument as to the meaning of commercial fishing operators is that his broader interpretation is consistent with the context in which Condition 20 was imposed. He points to the importance of construing conditions in their context[14]. Given that section 54G(5)(b) and (c) of the Act allows the court to have regard to the EIS and the Coordinator-General's report. Messages in the EIS make reference to "fishery" and "the fishery community" or the "fishing industry" when discussing the proposals for compensation schemes and the beneficiaries of any schemes. For instance:-

There is concern that removal of soft sediment habitat resulting from the construction of the Reclamation Area will reduce the available juvenile fishery species habitat, having flow-on effects to catch rates and economic viability of the fishery in future. There has also been suggestion that compensation for such losses may be appropriate. In terms of compensation, GPC has indicated throughout the EIS document that it will participate in any Queensland Government lead forum/discussion on the matter. However, while the loss of an area of benthic habitat is documented, rock revetment walls also provide interstitial fishery habitat both tidally and subtidally, offering a greater quantity of spatial refuge for juvenile taxa than does the existing open seabed. It is therefore also noted that the fishery communities are already adapted to using other meadows in the Gladstone region for those times during which seagrass meadows in the Western Basin are sparse (e.g. 2005).' (Emphasis added)

[19] The EIS SID states at pages 15-135 to 15-136:

Environmental offsets need to be locally based and not simply payment to State's consolidated revenue. Include recreational offsets, e.g. provision of all tide access boat ramp, boating facilities etc., and monetary compensation for loss of productive fishing areas. Consider enhanced local offsets package for loss of commercial and recreational opportunities.

• Alternate boat ramp facilities will be provided;
• Access to The Narrows will remain; and
• Ongoing discussions will be held with the fishing industry.' (Emphasis added)

[20] The CG's Report made similar reference to 'the commercial fishery community' when considering the need for Gladstone Ports Corporation to make available a 'compensation package'. The Report states at pages 64 to 65:

"There is concern among the Gladstone commercial fishery community that removal of soft sediment and seagrass habitat, resulting from the construction of the reclamation area and turbidity and sedimentation associated with dredging, would reduce juvenile fishery species habitat, having flow-on effects to catch rates and economic viability of the fishery in the future.

I acknowledge that the full impact of the WBDD Project on fisheries in the Western Basin would be a very difficult to accurately establish. However, I agree with DEEDI, GRC and QSIA that there would be some degree of impact and this impact needs to be determined and analysed in more details and an appropriate compensation package (if considered necessary) prepared to cover the relevant impacts.

As noted, potential marine impacts in the Western Basin harbour are not specific to the WBDD Project, rather to all current and proposed future activities of GPC. Therefore, my consideration of impacts to commercial fishing in Gladstone harbour is considered in the overall cumulative impact assessment in section 6 of this report.' (Emphasis added)

[21] The third reason relied on by Falzon as to why his interpretation of the term commercial fishing operator should be preferred to that of GPC is that two principles of interpretation favour it, namely:-

(a) The principle that a development consent is to be construed liberally. In that regard reliance is placed on Weston Aluminium Pty Ltd v Environment Protection Authority[15]. High Court 7 -

"[16] Alcoa submitted that 'a development consent is to be construed liberally without confining a use to the precise methods of process or activity, including the nature of the raw materials and the location from where they are sourced." ...

[17] The general approach to construction of development consents advocated by Alcoa is not disputed by Weston. It is an approach reflected in a number of decisions of the Court of New South Wales to which reference was made ...";

(b) The second principle relied upon is that, where two interpretations of the term "commercial fishing operators" are open, the court should interpret Condition 20 favourably to the businesses that in the fishing industry at Gladstone Harbour had a vested right that the fishing zones in the Harbour would be maintained prior to the commencement of the Project. Reliance was placed on a statement by Rackemann DCJ in Newman v Brisbane City Council [16] where his Honour said:-

"As in the Buttonville Airport case, the College as owner of the site has vested rights, or at least reasonable expectation of its own; there is authority for construing planning instruments which may be ambiguous favourably to it. See Matijesevic v Logan City Council (1984) 1 Qd R 599, 605 and re LDCM Investments Ltd v the Town of Newcastle (1975) 8 OR (2d) 504, 510-11 cited in Friends of Currumbin Association Inc v Gold Coast City Council [2006] QPEC 59; (2006) QPELR 657 at [33]."

[22] In the present case Falzon says, there is no owner of the Gladstone Harbour but businesses of the Gladstone Harbour fish industry being the classes he contends Condition 20 intends to protect, have vested rights in being able to operate their businesses out of Gladstone Harbour and have reasonable expectations that the operation of the project will not impede their ability to maintain their businesses. In that regard the last sentence of Condition 20 - "This is to cover temporary and permanent loss of access to fishing areas and marine fish habitat" - makes it clear that the Coordinator-General accepted that the fishing industry had a reasonable expectation that they would be compensated for any loss they suffered as a result of their "vested rights" in gaining access to fishing areas in marine fish habitat in the Harbour being infringed by the Project. Businesses that sold fish or supplied fishing equipment had the same vested rights in the maintenance of the fishing zones as the businesses that caught the fish.

[23] For the above reasons Falzon says that the broader interpretation of commercial fishing operators for which he contends should be preferred to the narrower interpretation.

CONCLUSION RE MEANING OF THE TERM "EXISTING COMMERCIAL FISHING OPERATORS" IN CONDITION 20

[24] The argument of GPC is to be preferred to that of Falzon as to the meaning of existing commercial fishing operators in Condition 20. They involve an entirely unjustifiable gloss on the language of Condition 20. The plain meaning of commercial fishing operators refers to fishers who carry out that occupation to derive income as opposed to recreational fishers. As I have said, Falzon himself relies upon the Oxford English Dictionary for the meaning of the term "fishery":-

"1. The business, occupation or industry of catching fish, or of taking other products of the sea or rivers from the water."

[25] I mention some other definitions from the shorter Oxford English Dictionary[17]:-

1. Interested in financial return rather than artistry, likely to make a profit;

Fishing - The act of catching or trying to catch fish especially by using a net or hook and line etc.

Operator - A person (professionally) engaged in performing the practical or mechanical operations of a process, business etc.

[26] The combination of those definitions discloses the common sense definition of a commercial fishing operator as one who engages in the business of catching fish.

[27] The relief sought rests squarely on the meaning of existing commercial fishing operators which I have rejected. .

[28] In my view the pleading is one which satisfies subcategories (a), (b) and (d) of UCPR 171(1) in that it does not disclose a cause of action by the applicants, in its present form has a tendency to prejudice or delay a fair trial and is frivolous and vexatious. It should never have been commenced.

[29] I'm dealing here only with the costs of GPC thrown away by reason of the amendment of the originating application filed on 30 January 2012. Since then it has had two further manifestations by amended originating application filed 3 April 2012[18] and the current pleading being the further amended originating application filed 26 April 2012[19] to the court's power to award costs is governed by SPA s 457 which powers the court to order costs in circumstances where it considers that a proceeding is frivolous or vexatious which I consider this pleading to be

[30] By letter dated 21 February 2012[20] the solicitors for GPC wrote to Falzon's solicitors detailing in great particularity the concerns it had in relation to the originating application including, relevantly, the meaning of commercial fishing operators in Condition 20. They raised the very concerns that were agitated in argument by GPC which I have upheld. Importantly, that letter told Falzon of the risk of a strike out application and notified him that GPC reserved its rights to make such an application. Two further amended pleadings follow. The original application sought a declaration that the term commercial fishing operators included those classes I have earlier outlined. The next amendment of 3 April 2012 abandoned that declaration and simply pleaded the meaning of that term as a fact as is the case in the most current pleading of 26 April 2012 the subject of this application. GPC's solicitors could have not have been clearer in bringing to the attention of Falzon the position of GPC as to the meaning of the term commercial fishing operators yet Falzon proceeded with the application notwithstanding and agitated an argument as to the meaning of that term which I consider was unarguable.

[31] DEEDI did not seek a similar order for costs on the amendments to the pleadings but, if sought, would in my view be equally entitled to costs. I grant liberty to apply to DEEDI to seek such an order if costs have been incurred.

[32] In view of my findings it is unnecessary for me to consider any of the other arguments. The pleading should be struck out. I shall hear the parties on the costs of this hearing.

1 That the further amended originating application filed 26 April 2012 be struck out; and

2 That the Applicant pay the costs of the first respondent in relation to amendments to the Originating Application; and

3. That the second respondent have liberty to apply for costs in relation to the amendments to the Original Application.

[5] Copy report Annexure JAM-1 to affidavit JA McDonnell filed 12 April 2012, Court document 17

[8] All parties agree that the second "of" on the last line of condition 21 should read "or"

[9] Pleading, para 4; Schedule to pleading pursuant to UCPR 75 which allows one person to commence proceedings on behalf of persons who have the same interest and could have been parties in the proceedings.

[12] Affidavit Ms R Jancauskas, 13 July 2012, pp 11 and 13

[14] Caloundra City Council v Taper Pty Ltd [2003] QPEC 19; [2003] QPELR 558 at [33]

[15] [2007] HCA 50; [2007] 82 ALJR 74 at [16]- [17]

[16] [2001] QPEC 287 at [28]

[20] Affidavit JA McDonnell, Exhibit JAN2