Hail Creek Coal Holding Pty Ltd & Ors v Michelmore [2020] QLC 16

Mudie v Gainriver Pty Ltd & Anor (2003) 2 Qd R 271; [2002] QCA 546,

EJ Morzone (instructed by Emanate Legal) for the objector

[1] Hail Creek Holding Pty Ltd and the other applicants have applied for a mining lease for infrastructure purposes over a 137.8 ha area of land held under what I will loosely describe as a pastoral lease owned by Mr Michelmore. The purpose in doing so is to authorise the use of that area for the Hail Creek village, the accommodation camp for miners employed on the Hail Creek Mine, a coal mine which has been operating continually since it opened in 2003.

[2] Mr Michelmore, who has objected to the grant of the lease, is the holder of a pastoral lease over the land which is part of a grazing enterprise known as Fort Cooper. The shape of the application area is roughly triangular and aligns with the area subject to the existing lease with the landholder.

[3] This area incorporates the existing accommodation village access and security infrastructure, including the Hail Creek Mine entry and associated infrastructure. The Hail Creek village accommodates all employees and contractors for the Hail Creek Mine and is operated for the exclusive use of these workers.

[4] Hail Creek has applied to strike out a ground of objection as being frivolous or vexatious. The focus of the hearing has been on the facts and circumstances relied upon to support one ground of objection, that is, ground 3.1.9. That ground is that the mining lease should not be granted because, taking into consideration the current and potential future uses of the land, the proposed mining operation is not an appropriate land use.

[5] That ground of objection references s 269(4)(m),[1] one of the criteria the Court must consider in making a recommendation on the application. As well as stating the grounds of objection, an objector must state the facts and circumstances relied on in support of the grounds of objection.

[6] The focus in this hearing was on the facts and circumstances relied upon in support of the ground of objection, but the application is to strike out the ground of objection in its entirety, all other facts and circumstances in support of that ground having been withdrawn by Mr Michelmore.

[7] Hail Creek says the ground is frivolous or vexatious. The Court has the power to strike out an objection if it finds it is frivolous or vexatious pursuant to s 267A(1)(b) of the Mineral Resources Act 1989 (MRA). That is the relevant provision, not any provision in the Uniform Civil Procedure Rules 1999 (UCPR), although it seems that the UCPR power may have been relied upon in the past by the Land and Resources Tribunal (LRT) and perhaps also by the Land Court before s 267A was inserted on 26 September 2014.[2]

[8] The Queensland Court of Appeal has considered similar wording to that contained in the MRA provision. That appeared in s 7.6(1A) of the Local Government (Planning and Environment) Act 1990.[3] That section then provided the Court could order costs as it considers appropriate where it considers the appeal or other proceedings to have been frivolous or vexatious.

[9] In Mudie v Gainriver Pty Ltd & Anor,[4] the majority in the Court of Appeal applied the ordinary meaning of those terms as defined in the Macquarie Dictionary:

"frivolous" as "of little or no weight, worth or importance; not worthy of serious notice: a frivolous objection. 2. characterised by lack of seriousness or sense: frivolous conduct ..." and "vexatious" as "1. causing vexation; vexing; annoying ..."

The third member relied on the definitions in the shorter Oxford English Dictionary to like effect.

[10] The majority also said that whether the proceedings are vexatious or oppressive turn on the circumstances of the case, and will include public policy considerations and the interests of justice.[5]

[11] There is an important distinction that I need to draw between the section considered by the Court of Appeal in Mudie's case, and s 267A. In Mudie's case, the finding that an appeal was frivolous or vexatious enlivened a power for the Court to order a party to bear some or all of another party's costs. Here, the finding that a ground of objection is frivolous or vexatious results in the ground of objection being struck out.

[12] The Court cannot hear evidence from an objector about a matter not contained in an objection.[6] The effect, therefore, of granting the application would be to hold out the objector from leading evidence about whether the continued use of the land for the mining camp is an appropriate land use given the current and proposed use of the land.

[13] I accept Mr Morzone's submission that the Court should approach such a finding with caution. I also note an important distinction between the alternatives of an objection being frivolous or vexatious, and I will return to that later. An objection may be struck out because it meets either of those descriptions.

[14] A frivolous objection is one which lacks reasonable grounds. A vexatious objection is one instituted without grounds for winning, purely to cause trouble or annoyance, in this case to the applicant.

[15] This case is a mining objection hearing. The function of the Court is to hear and determine any objections to a mining lease and, considering the objections and the statutory criteria in s 269(4) of the MRA, making a recommendation to the Minister about the application. But for the objection, this Court would have no function in relation to the application. It would not have been referred to the Court and would be assessed and considered by the Minister without any recommendation from the Court.

[16] Neither party bears the onus of proof in the sense that it is not for the applicant to prove the application should be granted despite the objection, nor is it for the objector to prove the merit of their objections. The Court, in making its recommendation on the application, must consider all of the evidence, and take into account and consider both the objections and the statutory criteria in deciding what recommendation to make.

[17] Further, as I've already observed, the Court cannot hear evidence from an objector that is not grounded in an objection, and that is relevant to public policy considerations and assessing what is in the interests of justice.

[18] The Court's function is not to undertake a broad administrative inquiry. The scope of the objection will necessarily affect the scope of the hearing and the pre-hearing steps that must be taken to prepare for it. Mr Michelmore's objection did not provide a specific concern about either surface or groundwater.

[19] It does seem that the objection as a whole, that is, all of the grounds of objection, were drafted on an assumption that there would be active mining on the mining lease if granted. However, the application seeks approval for infrastructure purposes only. There are some indications in the material that the objection was hastily drafted, being an incomplete amendment of an objection lodged in a different matter involving a new mine proposal. That is an inference you could draw on the material before the Court.

[20] Mr Michelmore's lawyers have made various amendments to the objection to remove irrelevant material or to fix errors, such as in the description of the affected property or the nature of the application. Importantly for this application, the facts and circumstances relating to this ground of objection have been amended to remove any reference to a "mining void".

[21] That lack of care in drafting an objection is troublesome where a party is represented by a firm well-experienced in litigation of this nature, and it has resulted in the applicant having to take positive steps, and incur costs in doing so, to seek clarity about the objection. Mr Michelmore has had the opportunity to provide facts and circumstances that give meaning and focus to the ground of objection relating to this use being an inappropriate land use.

[22] In response to Hail Creek's request for further and better particulars of the surface water aspect of the ground, Mr Michelmore said:

"the application is unsupported and/or the Applicant has not provided any material or monitoring results demonstrating any assessment since in or about 2009 of the impacts or potential impacts which the past or the proposed activities have had or will have on the surface water quality, quantity or ecology and has failed to show how and in what manner such impacts will be appropriately ameliorated or will meet current environmental standards including in relation to water supply, stormwater and sewage treatment; further or alternatively says the request is a request for evidence which will be provided after the joint meetings of experts and receipt of expert evidence."[7]

He responded in similar terms to the request about groundwater impacts. Counsel for Mr Michelmore submits the impact of the operation on water and therefore on the landowner's agricultural enterprise are legitimate issues.

[23] I note, though, that Mr Michelmore has raised other grounds of objection that are more closely related both to the environmental impacts of the operation and to the impact of the camp on his agricultural activity. Ground 3.1.5 refers to adverse environmental impacts. The facts and circumstances in relation to that ground do not reference water.

[24] Ground 3.1.7 refers to the adverse impact on the agricultural enterprise. Again, the facts and circumstances in relation to that ground do not refer to water, although they refer to many other things including dust, noise, carrying capacity, and so on.

[25] The response from Mr Michelmore to the request for particulars is to the effect that Hail Creek has not provided sufficient information to demonstrate there will not be unacceptable impacts on surface and groundwater. Further, that in effect, the request is a request for evidence. That response fails to identify any particular concern by the objector arising from Hail Creek's current use of the area applied for, or arising from any other activity that might be authorised under the mining lease if granted, that explains its objection that the use is not an appropriate land use.

[26] This is a very unusual mining lease application, and the application to strike out the ground of appeal must be assessed in the particular circumstances of this case. Given the camp is well-established and Mr Michelmore is the lessee, it is reasonable to expect him to be more specific about the nature and source of his concern.

[27] The camp has been operating at least since 2003 on an area leased by Mr Michelmore some 22 years ago. Mr Sheppard (the Manager Environment and Community for the Hail Creek Coal Mine) deposed that he is unaware of Mr Michelmore lodging a formal complaint about ground or surface water issues.[8] Further, he has found no reference to such a complaint in the records maintained at the mine site.

[28] The camp was constructed and is currently regulated under a development approval granted by Isaac Regional Council. I mention this because if the mining lease is granted, the Sustainable Planning Act 2009[9] will no longer apply, and the village will no longer be regulated under that approval. That is the effect of s 4A of the MRA. That is a matter the Court will need to consider in making a recommendation on the application. That is, it may be appropriate for the Court to recommend the lease is granted subject to conditions. The existing development authority or approval may provide a basis for doing so, although there is also an existing an environmental authority (EA) that will cover this area if the mining lease is granted.

[29] The former LRT struck out objections as frivolous or vexatious where the mining lease applicant would have to speculate what was being asserted against them, and essentially, that is the position that Hail Creek is in for this objection. The ground of objection was narrowed, by Mr Michelmore abandoning other facts and circumstances in support of it, to a ground focused on groundwater and surface water impacts. Given the length of time the camp has been in existence, its lengthy coexistence with Mr Michelmore's agricultural enterprise and no evidence of any concerns about water arising from the camp, Hail Creek is left to speculate on what this ground of objection relates to.

[30] A strike out order can be made at any stage of the mining objection hearing.[10] Depending on the case, it may be inappropriate to strike out a ground of objection prior to the hearing, as it may not be possible to assess its merits without first hearing evidence. Counsel for Mr Michelmore effectively submitted that, arguing the strike out application is premature and should not proceed until the experts have provided a joint report.

[31] If the objections are not stuck out, they will frame the brief for experts to prepare their reports to assist the Court in its function. As they stand, it is not possible to identify for the experts what they must consider with any degree of specificity. The only way they could proceed, as I see it, would be to undertake a wholesale investigation of the potential impacts of the mining camp on surface and groundwater.

[32] Usually, an objector is faced with a proposal to undertake an activity and the potential impacts of that activity may not be clear. That is, the objector and the Court must anticipate what might occur. But that stands in stark distinction to the situation with this case. It involves authorising an activity that has been operating for many years. It was constructed and regulated under a development approval for that purpose. Mr Michelmore has not identified any issue with the terms of the development approval or the way in which the camp is operating, nor has he pointed to any adverse impact on water that he says is or may be attributable to the camp.

[33] Further, the amended EA includes significant conditions dealing with impacts on water, including a schedule dealing with sewage treatment. They also require ongoing monitoring of water quality and investigation if reportable triggers are observed. Mr Michelmore has not alleged these conditions are inadequate. The construction and operation of the mining camp has already been considered by the relevant regulator on two occasions, firstly by the local authority when the development approval was granted, secondly by the Department of Environment and Science when it granted the application to amend an existing EA to include this activity.

[34] Given those unusual circumstances, I am not satisfied this Court should embark on broad scale investigation of the potential water impacts of an existing camp without some better indication of the landowner's concern. Given the lengthy operation of the camp, the only facts and circumstances relied upon are so vague as to be meaningless.

[35] I am satisfied this ground of objection is frivolous because the landowner has not articulated reasonable foundation for it. However, I am not making a finding that the ground of objection is vexatious. Although its effect may be to vex the applicant, I am not satisfied that the ground of objection was raised purely to cause trouble or annoyance to the applicant. There is no direct evidence of such intent by Mr Michelmore and given the other grounds of objection that are not challenged today, I could not infer such intent on the material before the Court. Accordingly, I order that ground of objection 3.1.9 is struck out as frivolous.

Ground of objection 3.1.9 is struck out as frivolous.

[1] Mineral Resources Act 1989.

[2] Inserted by the Mineral and Energy Resources (Common Provisions) Act 2014.

[4] (2003) 2 Qd R 271; [2002] QCA 546 [35].

[6] MRA s 77(3).

[7] Objector's Response to Applicant's Request for Further and Better Particulars Dated 20 November 2019, filed 12 December 2019 [9].

[8] Affidavit of Thomas Bernie Sheppard, filed 6 March 2020.

[9] Now the Planning Act 2016.