Harvey & Anor v Minister Administering the Water Management Act 2000; Tubbo Pty Ltd & Ors v Minister Administering the Water Management Act 2000

FILE NUMBER(S) : 41275 of 2006; 41283 of 2006

KEY ISSUES: Judicial Review :- amendment order - water sharing plan - whether amendment to plan an amendment or a new plan - whether amendment order exceeded the Minister's power - procedural fairness - whether duty applied to making of amendment order - if so, whether amendment order made in breach of duty - content of any duty - amendment order within power - no duty of procedural fairness - alternatively, no breach of duty

Administrative Decisions (Judicial Review) Act 1977 (Cth) Artesian Wells Act 1897 Catchment Management Authorities Act 2003 LEGISLATION CITED: Protection of the Environment (Operations) Act 1997 Water Act 1912 Water Management Act 2000 Water Management (General) Regulation 2004 Water Management (General) Amendment Regulation 2006

Ainsworth v Criminal Justice Commission (1992) 175 CLR 564 Annetts v McCann (1990) 170 CLR 596 Applicant VEAL of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs (2005) 225 CLR 88 Attorney-General (NSW) v Quin (1990) 170 CLR 1 Attorney-General for the State of Western Australia v Marquet (2003) 217 CLR 545 Botany Bay City Council v Minister of State for Transport and Regional Development (1996) 41 ALD 84 Bread Manufacturers of New South Wales v Evans (1980) 180 CLR 404 Buck v Comcare (1996) 66 FCR 359 Campbelltown City Council v Vegan (2006) 67 NSWLR 372 Commissioner for Australian Capital Territory Revenue v Alphaone Pty Ltd (1994) 49 FCR 576 Commissioner of Police v Tanos (1958) 98 CLR 383 Comptroller-General of Customs v Kawasaki Motors Pty Ltd (No 1) (1991) 32 FCR 219 Darling Casino Limited v New South Wales Casino Control Authority (1997) 191 CLR 602 Deloitte Touche Tohmatsu v Australian Securities Commission (1995) 54 FCR 562 Director of Public Prosecutions v Smith [1991] 1 VR 63 Dunlop v Woollahra Municipal Council [1975] 2 NSWLR 446 FAI Insurances Limited v Winneke (1981) 151 CLR 342 Foster v Minister for Customs and Justice (2000) 200 CLR 442 Gardner v Dairy Industry Authority of New South Wales [1977] 1 NSWLR 505 Haoucher v Minister of State for Immigration and Ethnic Affairs (1990) 169 CLR 648 Kioa v West (1985) 159 CLR 550 Lesnewski v Mosman Municipal Council (2005) 138 LGERA 207 McInnes v Onslow-Fane [1978] 1 WLR 1520 McWilliam v Civil Aviation Safety Authority (2004) 142 FCR 74 Minister for Aboriginal Affairs v Peko-Wallsend Limited (1986) 162 CLR 24 Minister for Local Government v South Sydney City Council (2002) 55 NSWLR 381 Minister for Urban Affairs and Planning v Rosemount Estates Pty Ltd (1996) 91 LGERA 31 Mobil Oil Australia Pty Limited v Federal Commissioner of Taxation (1963) 113 CLR 475 CASES CITED: Murrumbidgee Groundwater Preservation Association Inc v Minister for Natural Resources (2005) 138 LGERA 11 O'Sullivan v Farrer (1989) 168 CLR 210 OzEpulse Pty Ltd v Minister for Agriculture, Fisheries and Forestry (2007) 163 FCR 562 Plaintiff S157/2002 v Commonwealth of Australia (2003) 211 CLR 476 Public Service Board of New South Wales v Osmond (1986) 159 CLR 656 Qantas Airways Limited v Aravco Limited (1996) 185 CLR 43 Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam (2003) 214 CLR 1 Re Minister for Immigration and Multicultural Affairs and Another; Ex parte MIAH (2001) 206 CLR 57 Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Palme (2003) 216 CLR 212 Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82 Riverina Wines Pty Ltd v Registrar of the Workers Compensation Commission of New South Wales [2007] NSWCA 149 Roads and Traffic Authority (NSW) v Ashfield Municipal Council (2005) 141 LGERA 278 Salemi v Mackellar [No. 2] (1977) 137 CLR 396 Save the Showground for Sydney Inc v Minister for Urban Affairs and Planning (1997) 95 LGERA 33 Sinclair v Mining Warden at Maryborough (1975) 132 CLR 473 State of South Australia v O'Shea (1987) 163 CLR 378 Stead v State Government Insurance Commission (1986) 161 CLR 141 SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs (2006) 228 CLR 152 Singh v The Commonwealth (2004) 222 CLR 322 Telstra Corporation Ltd v Commonwealth (2008) 243 ALR 1 Terrace Towers Holdings Pty Ltd v Sutherland Shire Council (2003) 129 LGERA 195 Tickner v Chapman (1995) 57 FCR 451 Transport Action Group Against Motorways Inc v Roads and Traffic Authority (1999) 46 NSWLR 598 Vanmeld Pty Ltd v Fairfield City Council (1999) 46 NSWLR 78 VAW (Kurri Kurri) Pty Ltd v Scientific Committee (Established under s127 of the Threatened Species Conservation Act 1995) (2003) 58 NSWLR 631 Victims Compensation Fund Corporation v Nguyen (2001) 52 NSWLR 213 Warringah Council v Edmondson [2001] NSWCA 1 White v Ryde Municipal Council [1977] 2 NSWLR 909 Wilson v Anderson (2002) 213 CLR 401

DATES OF HEARING: 18, 19, 20 March 2008, 30 April 2008 (further written submissions - 9 and 23 May 2008)

41275 of 2007 APPLICANTS Mr Shane Prince SOLICITORS Mackenzie Vardanega

RESPONDENT Mr N C Hutley SC with Mr Jeremy Kirk SOLICITORS Crown Solicitor's Office LEGAL REPRESENTATIVES:

41283 of 2007 APPLICANTS Mr B A Coles QC with Mr Shane Prince SOLICITORS Watson Mangioni

RESPONDENT Mr N C Hutley SC with Mr Jeremy Kirk SOLICITORS Crown Solicitor's Office

JUDGMENT: THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES

ADRIAN DAVID HARVEY & MARGARET ELIZABETH HARVEY & ANOR Applicants

MINISTER ADMINISTERING THE WATER MANAGEMENT ACT 2000 Respondent

MINISTER ADMINISTERING THE WATER MANAGEMENT ACT 2000 Respondent

JUDGMENT Jagot J: A. Issues 1 On 1 October 2006 the respondent Minister made the Water Sharing Plan for the Lower Murrumbidgee Groundwater Sources 2003 Amendment Order 2006 (the amendment order) under s 45(1)(a) of the Water Management Act 2000 (the Water Management Act). The amendment order amended the Water Sharing Plan for the Lower Murrumbidgee Groundwater Sources 2003 (the plan).

2 The applicants are each engaged in primary production activities within the area to which the plan applies. The applicants contend that the amendment order is invalid and seek associated declarations and orders in these proceedings. The proceedings were heard together, with evidence in one being evidence in the other.

3 Although their pleadings traversed numerous issues, the applicants' claims (by the conclusion of the proceedings) may be summarised as follows: (1) The amendment order was not authorised by s 45 of the Water Management Act because, rather than an amendment to the plan, the amendment order involved the making of a new plan (without the Minister complying with various provisions applying to the making of a plan including ss 18(1), 46 and 87AA).

(2) The amendment order was made in breach of s 45(4) of the Water Management Act in that cl 3 purports to extend the duration of the plan.

(3) The amendment order was made in breach of a duty of procedural fairness to the applicants. This part of the applicants' case related to the fact that the amendment order inserted Sch 5 into the plan. The significance of Sch 5 is explained below.

(4) The amendment order is thereby invalid. In consequence, the provisions of cl 3(1)(a)(ii) of Sch 10 to the Water Management Act, converting bore licences under the Water Act 1912 (the 1912 Act) into aquifer access licences under the Water Management Act, are not engaged. Accordingly, the applicants retain their bore licences under the 1912 Act.

4 In these reasons I refer to: - (i) the applicants, where no distinction between the two applicants is required, (ii) the Tubbo applicants, to identify the applicants in proceedings 41283 of 2006 (a term used with respect to the Tubbo applicants or any one or more of them), and (iii) the Harvey applicants, to identify the applicants (either or both of them) in proceedings 41275 of 2006.

5 The following terms are also used: - (i) the Department means the Department responsible for administering the Water Management Act (known at different times as the Department of Land and Water Conservation or DLWC, the Department of Infrastructure, Planning and Natural Resources or DIPNR, and the Department of Natural Resources or DNR), (ii) the Minister means the Minister administering the Water Management Act, and (iii) ML means megalitre (1000 litres). There are other relevant entities and committees defined separately below.

6 Before the commencement of the relevant part of the statutory scheme under the Water Management Act, Pt 5 of the 1912 Act regulated access to groundwater. Part 5 provided a scheme for licensing the sinking of, and the taking and using of water from, bores.

7 The applicants each held bore licences under Pt 5 of the 1912 Act. The Tubbo applicants held bore licences 40BL119208, 40BL186229, 40BL188059, 40BL188060, 40BL188118, 40BL186128, 40BL190747, 40BL187100, and 40BL187101 carrying an entitlement to groundwater totalling 20,742ML per year. The Harvey applicants held bore licences 40BL186524 and 40BL188655 carrying an entitlement to groundwater of 3045ML and 4000ML per year (or 7045ML per year in total). These entitlements were subject to the provisions of Pt 5 (which enabled the Minister to restrict or control flow rates or restrict or suspend rights under licences in the circumstances specified in the statutory provisions) and to the conditions of the licences (which included the Department's right to vary the volumetric allocation and rate of taking the allocation under the licences). For various reasons the applicants did not extract their full entitlements under these bore licences.

8 Under the regime of the 1912 Act entitlements under licences within the lower Murrumbidgee area reached 512,409ML per year (according to the Murrumbidgee Groundwater Assistance Model developed by the Department). This resulted from the policy of controlled depletion of groundwater directed at addressing salinity and maximising regional economic benefits from groundwater. By the mid 1990s concerns emerged about the environmental impacts of groundwater depletion and the long-term viability of groundwater resources. In August 1997 the NSW Government released a policy document directed towards achieving sustainable use of groundwater. This led to a moratorium being placed on the grant of new licences within the area on 10 September 1997. In April 1998 the Murrumbidgee groundwater system was identified as at risk by reason of resource over-allocation. By August 1999 the moratorium imposed in 1997 became an embargo on new licence applications.

9 The Water Management Act commenced on 1 January 2001. The objects of the Act (s 3) are to "provide for the sustainable and integrated management of the water sources of the State for the benefit of both present and future generations".

10 Chapter 2 concerns water management planning. It includes obligations for those exercising functions under the Act to promote the water management principles in s 5 and to give effect to the State Water Management Outcomes Plan (the SWMOP) made under s 6 (see s 9). Part 2 of Ch 2 provides for the constitution of management committees for any water management area.

11 Part 3 of Ch 2 deals with management plans prepared by committees constituted under Pt 2 of Ch 2.

12 Div 1 of Pt 3 deals with certain preliminary matters. Under s 16 a management plan is to be consistent with various instruments of policy, including the SWMOP. Section 17 specifies the kinds of provisions that a management plan may contain. Section 18 imposes obligations on a management committee to "have due regard to" matters when formulating a draft management plan, including the "socio-economic impacts of the proposals considered for inclusion in the draft plan".

13 Divisions 2 to 7 of Pt 3 deal with the provisions of management plans with respect to water sharing, water use, drainage management, floodplain management, controlled activities, and environmental protection. Where a plan provides for water sharing it must contain core provisions (s 20(1)) dealing with the establishment of environmental water rules, the identification of requirements for water within the area or from the water source to satisfy basic landholder rights, the identification of requirements for water for extraction under access licences, the establishment of access licence dealing rules for the area or water source, and the establishment of a bulk access regime for the extraction of water under access licences, having regard to these rules and requirements.

14 Division 8 of Pt 3 contains the procedures for making management plans. The procedures include notification of nominated bodies of certain general matters about the draft plan (s 36) and public exhibition of the draft plan (s 38). The management committee is to consider submissions before re-submitting the draft plan to the Minister. Under s 41 the Minister may make a management plan by order published in the Gazette. Section 42 provides that a management plan may be amended by a subsequent management plan made in accordance with Pt 2. However, s 42 does not limit the operation of Div 9 of Pt 3 (s 42(2)).

15 Section 43 deals with the duration of management plans as follows: (1) Subject to section 43A, a management plan has effect for: (a) if the plan commenced on 1 July in any year - 10 years from that date, or (b) in any other case - 10 years from 1 July next after the date the plan commenced.

16 Section 43A provides for the extension of the duration of a management plan dealing with water sharing.

17 Div 9 of Pt 3 contains a single provision central to the applicants' claims, s 45, as follows: (1) The Minister may at any time, by order published in the Gazette, amend a management plan: (a) if satisfied it is in the public interest to do so, or (b) in such circumstances, in relation to such matters and to such extent as the plan so provides, or (c) if the amendment is required to give effect to a decision of the Land and Environment Court relating to the validity of the plan. (2) (Repealed) (3) Before amending a management plan, the Minister must obtain the concurrence of the Minister for the Environment to the amendment. (4) The date of commencement of a management plan may, but the duration of a management plan may not, be extended by an amendment of the plan under this section. (5) The Minister may at any time, by order published in the Gazette, repeal a management plan (other than a management plan that deals with water sharing). (6) The amendment or repeal of a management plan under this section takes effect on the date the order is published in the Gazette or on a later date specified in the order. (7) An order under subsection (1)(a) varying a bulk access regime is not to be made in relation to a water management area for which a management committee for water sharing is constituted unless the Minister has consulted with the committee in relation to the proposed amendment. (8) A provision of a management plan that authorises the amendment of the plan in accordance with section 42(2) of this Act is to be construed as a reference to an amendment authorised by subsection (1)(b).

18 Division 11 contains miscellaneous provisions. Section 46 specifies the Minister's obligations to include certain statements in an order making a replacement or amendment to a management plan where the replacement plan or amendment will result in a reduction of water allocations in relation to which compensation might be payable under s 87AA (a right to compensation in specified circumstances).

19 Section 47 deals with challenges to the validity of management plans as follows: (1) The validity of a management plan may not be challenged, reviewed, quashed or called into question before any court in any proceedings, other than before the Land and Environment Court in proceedings commenced within the judicial review period. (2) The judicial review period in respect of a management plan is: (a) the period of 3 months after the date the plan was published in the Gazette, except as provided by paragraph (b), or (b) in relation to a provision of the plan that was inserted by an amendment of the plan (other than an amendment under section 45(1)(c)), the period of 3 months after the date that the amendment was published in the Gazette. A judicial review period does not arise as a result of the extension of the duration of a management plan. (3) …

(5) The provisions of or made under this Act and the rules of natural justice (procedural fairness), so far as they apply to the exercise of any plan-making function, do not place on a designated person any obligation enforceable in a court (other than in the Land and Environment Court in proceedings commenced within the judicial review period). (6) Accordingly, no court (other than the Land and Environment Court in proceedings commenced within the judicial review period) has jurisdiction or power to consider any question involving compliance or non-compliance, by a designated person, with those provisions or with those rules so far as they apply to the exercise of any plan-making function. ( 7) This section is not to be construed as applying the rules of natural justice to the exercise of plan-making functions for the purposes of proceedings instituted within the judicial review period. (8) …

20 Section 48 requires the Minister to take all reasonable steps to give effect to the provisions of any management plan and, in particular, to ensure that any environmental water rules established by the plan are observed. Section 49 requires a public authority to have regard to the provisions of any management plan to the extent to which they apply to the public authority.

21 Division 11 of Pt 3 contains a single provision, s 50, relating to a Minister's plan. The definition of "management plan" in the Dictionary to the Water Management Act includes a Minister's plan. Section 50 provides as follows: (1) The Minister may, by order published in the Gazette, make a plan (a Minister's plan ): (a) for any part of the State that is not within a water management area, or (b) for any water management area or water source, or part of a water management area or water source, for which a management plan is not in force, or (c) for any water management area or water source, or part of a water management area or water source, for which a management plan is in force, but only so as to deal with matters not dealt with by the management plan. (1A) A Minister's plan may be made for more than one water management area or water source or for parts of more than one water management area or water source. (2) A Minister's plan must in general terms deal with any matters that a management plan is required to deal with, and may also deal with any other matters that a management plan is authorised to deal with, other than matters that are already dealt with by a management plan. (2A) Part 3 (except sections 15 and 36 - 41) applies to a Minister's plan. However, the Minister: (a) may adopt any of the provisions of sections 36 - 41 in a particular case, and (b) may dispense with a particular requirement of Part 3 in the case of a Minister's plan referred to in subsection (1A). (3) Before making a Minister's plan, the Minister must obtain the concurrence of the Minister for the Environment to the making of the plan. (4) Except to the extent to which this Act otherwise provides, a Minister's plan has the same effect as a management plan. (5) The Minister may decide whether to make a Minister's plan or a management plan in respect of any matter (whether or not any draft management plan has been submitted to the Minister).

22 Chapter 3 of the Water Management Act deals with water management implementation. Pt 2 concerns access licences. Under s 55A Pt 2 of Ch 3 applies by declaration in a proclamation published in the Gazette. Under s 56 an access licence entitles its holder to a specified share in a water source (the share component) and to take water as specified (the extraction component). The various categories of access licence are specified in s 57, including aquifer access licences. Section 58 identifies the priorities between different types of access licence. Section 59 enables the Minister to make an available water determination by order in writing. An available water determination determines the availability of water under access licences. Section 60 establishes the rules for the making of an available water determination. It also makes provision for the suspension of those rules where the Minister is satisfied that there is a severe water shortage.

23 Other divisions of Pt 2 of Ch 3 establish the scheme for the granting, duration, and conditions of access licences. The scheme includes a register of access licences and security interests over access licences, and provisions regulating dealings in access licences (by transfer, conversion, subdivision, consolidation and the like). The provisions for dealings with access licences create a market for water entitlements. Division 8A provides for a register of available water determinations and provisions dealing with water accounting. Division 9 of Ch 3 contains s 87AA and other provisions specifying circumstances in which compensation may be claimed.

24 Chapter 7 contains enforcement provisions. Under s 341 a person must not take water from a water source other than in accordance with an access licence and from a water allocation credited to that licence and by means of a water supply work nominated by that access licence as a work by means of which water allocations credited to the licence may be taken. In other words, available water determinations (which control the credit of water allocations) regulate access to water in accordance with an access licence.

25 Section 388 enables the Minister to establish advisory and other committees for the purposes of the Water Management Act.

26 Section 398(1) permits the Minister to delegate any functions under the Water Management Act other than the power of delegation.

27 Under s 389A the Minister may authorise a catchment management authority to exercise certain functions, including "assisting the Minister or a management committee in the development of, in consultations about or in the implementation of management plans". A catchment management authority is an authority constituted under the Catchment Management Authorities Act 2003 (s 6). The Murrumbidgee Catchment Management Authority is so constituted (Sch 1) with respect to the area of operations defined on a map identified in Sch 2 (s 7). The catchment management area of the Murrumbidgee Catchment Management Authority includes the groundwater sources the subject of the plan.

28 Section 392 establishes the State's rights to the control, use and flow of all waters in rivers, lakes and aquifers, conserved by any works that are under the control or management of the Minister, and occurring naturally on or below the surface of the ground.

29 Schedules 9, 10 and 11 have effect by operation of s 403.

30 Under cl 1(1) of Sch 9 the regulations may contain provisions of a savings or transitional nature consequent on the enactment of various statutes, including the Water Management Act. If the regulations so provide, such a provision has effect despite any other provision of Sch 9, Sch 10, or Sch 11 (cl 1(4)).

31 Schedule 10 deals with the conversion of former entitlements under earlier legislation (including the 1912 Act) to access licences and approvals. Under cl 1, the schedule applies to an access licence that relates to a part of the State or water source to which Pt 2 of Ch 3 applies by operation of a proclamation under s 55A. A proclamation under s 55A was issued and took effect on 1 October 2006 applying Pt 2 of Ch 3 to the water sources the subject of the plan.

32 Clause 2 of Sch 10 defines "entitlement" in a manner that includes a licence referred to in Pt 5 of the 1912 Act (defined, for the purposes of the schedule, as the 1912 Act). By this means all bore licences under the 1912 Act constitute former entitlements for the purposes of Sch 10. Clause 2 also defines the following terms: former entitlement , in relation to an access licence or approval, means the entitlement from which the access licence or approval arises because of the operation of this Schedule. replacement access licence , in relation to an entitlement, means an access licence (including any supplementary water access licence) that, by operation of this Schedule, arises from the entitlement or from a direction under section 20AA of the 1912 Act in relation to the entitlement.

33 Pt 2 of Sch 10 deals with the conversion of former entitlements. Clause 3(1)(a)(ii) is relevant to the present matters. Clause 3 is as follows: (1) Subject to this Schedule, an entitlement that, immediately before the appointed day, was in force under the 1912 Act, the 1948 Act or the 1994 Act is taken to have been replaced: (a) to the extent to which it entitles any person or body to take a specified quantity of water, by an access licence held by that person or body (subject to such of the conditions of the entitlement as are applicable to an access licence): (i) for the quantity of water so specified, or (ii) if the relevant management plan, and regulations made for the purposes of this paragraph, indicate that a different quantity of water calculated in accordance with a specified methodology may be taken under an access licence issued in relation to the water management area or water source to which the management plan applies - for a different quantity of water calculated in accordance with that methodology, and …

34 The Minister made the amendment order on 1 October 2006. On the same day the proclamation applying Pt 2 of Ch 3 to the water sources the subject of the plan took effect. Also on that day, the Water Management (General) Regulation 2004 (the 2004 Regulation) was amended by the Water Management (General) Amendment Regulation 2006 (the 2006 Regulation).

35 The amendment order amended various provisions of the plan. Amongst other things, the amendment order omitted cl 3 from the plan (relating to its commencement and duration) and replaced it with a clause as follows: This Plan takes effect on 1 October 2006, and ceases on the 30 June 2017.

36 The amendment order omitted cl 4(2) (identifying the groundwater sources referred to in the plan) and replaced it with a clause referring to a shallow groundwater source (characterised by the Shepparton formation) and a deep groundwater source (generally represented by the Calivil and Renmark formations). The applicants' interests arise with respect to the deep groundwater source.

37 The amendment order omitted cl 16 dealing with recharge but the replacement recharge clause (also cl 16) identifies the same recharge figures as the basis for water sharing in the plan as follows: (1) The overall basis for water sharing in this Plan is the average annual recharge to these groundwater sources, plus the requirements for basic landholder rights at the commencement of this plan and is as follows: (a) 65,000 megalitres per year (hereafter ML/yr ), plus the requirements for basic landholder rights at the commencement of this plan for the Shallow Groundwater Source and, (b) 335,000 ML/yr, plus the requirements for basic landholder rights at the commencement of this plan for the Deep Groundwater Source. (2) The Minister may under section 45(1)(b) of the Act, amend subclause (1) after 30 June 2011 vary the average annual recharge values for these groundwater sources following further recharge studies undertaken by the Minister.

38 Most relevantly for present purposes, the amendment order omitted cl 25 of the plan and replaced it with provisions including the following: 25 This part is made in accordance with section 20(1)(c) of the Act. … 25C (1) … … (3) For those Water Act 1912 entitlements in the Deep Groundwater Source equal to or less than 100 ML that are to become aquifer access licences in this groundwater source at the commencement of this Plan, the share component is to be equal to the Water Act 1912 entitlement. (4) For each entitlement in the Deep Groundwater Source referred to in Column 1 of Schedule 5 applying to the licences listed in Column 2 of Schedule 5 that are to become aquifer access licences in this groundwater source at the commencement of this Plan, the share component is to be equal to the share component in Column 3 of Schedule 5. (5) For those Water Act 1912 entitlements in the Deep Groundwater Source greater than 100 ML and not listed in Column 1 of Schedule 5 and that are to become aquifer access licences in this groundwater source at the commencement of this Plan, the share component will be established in accordance with the following formula: SCAAL = AV +HV Where: (a) SCAAL is the share component of the aquifer access licence,

(b) AV is the volume required to provide asset value protection and to protect entitlements greater than 100 ML from being reduced below 100 ML and is calculated from the following formulae: AV = (WAE x 0.1857) or 100 whichever is the greater Where WAE is the Water Act 1912 entitlement, (c) HV is the history of extraction component and is calculated from the following formulae:

HV = (HOE R /ΣHOE R ) x (R-PEW-LWU-SD-ΣSL-ΣEXC-ΣAV) Where: (i) HOER = 0 where HOE ≤ AV,

Note. Where HOER = 0 the history of extraction component (HV) will also be 0.

(iv) R is the amount of recharge established in clause 16(1)(b),

(v) PEW is the volume of recharge reserved as planned environmental water in clause 18(1)(c),

(vi) LWU is the total of local water utility access licence share components in this groundwater source at the commencement of this Plan,

(vii) SD is the total volume of domestic and stock access licences in the Deep Groundwater Source at the commencement of this Plan,

(viii) ΣSL is the total volume of all Water Act 1912 entitlements that are less than or equal to 100 ML as defined in subclause (3),

(ix) ΣEXC is the sum of share components specified in Column 3 of Schedule 5, and

(x) ΣAV is the total of the asset value protection component volumes calculated under subclause (5)(b). (6) For the purposes of subclause (5) and clause 25D HOE is equal to the greater of: (a) the average extraction over the seven water years from 1995/96 to 2001/02 not exceeding the Water Act 1912 entitlement in 2001/02 and excluding zero and low extraction years prior to activation, or

(b) the average extraction over the five water years from 1997/98 to 2001/02 not exceeding the Water Act 1912 entitlement in 2001/02 and excluding zero and low extraction years prior to activation, or

(c) the average extraction over the six water years from 1997/98 to 2002/03 not exceeding the Water Act 1912 entitlement in 2001/02 and excluding zero and low extraction years prior to activation. Note. The rules for determining HOE are contained in Appendix 4.

(7) For the purposes of subclause (6) zero and low extraction years are years where extraction was less than 20% of the maximum volume of water extracted in any one year between 1995/96 and 2001/02.

(8) For the purposes of subclause (6) activation is defined as the first year between 1995/96 and 2001/02 in which a licence holder extracted 20% or more of the maximum volume of water extracted in any one year between 1995/96 and 2001/02.

(9) It is estimated that at the time of commencement of this Plan the share components of aquifer access licences established under subclauses (2), (3), (4) and (5) for the Deep Groundwater Source will total approximately 267,500 unit shares.

25D (1) Those Water Act 1912 entitlements that are to be converted to an aquifer access licence in the Deep Groundwater Source under clause 25C(3) may also receive a supplementary water access licence. (2) The share component of a supplementary water access licence converted under subclause (1) will established [sic] in accordance with the following formula:

(a) SCSWAL is the share component for the supplementary water access licence,

(b) HOE is as defined in subclauses 25C(6), (7) and (8),

(c) SCAAL is the share component of the aquifer access licence established under clause 25C(4) and (5). (3) It is estimated that at the time of commencement of this Plan the share components of supplementary water access licences established under subclause (1) for the Deep Groundwater Source will total 39,800 unit shares. Note. Not all aquifer access licences amended under clause 25C (3) will receive a supplementary water access licences [sic] . Only those licences who have a HOE as defined in subclauses 25C(6), (7) and (8) which is greater than their new Aquifer Access Licence Share component.

25E (1) This Plan recognises that the total requirements for water for extraction within these groundwater sources may change during the term of this Plan as a result of: (a) the granting, surrender or cancellation of access licences, or

(b) the variation of local water utility access licences under section 66 of the Act.

(2) Pursuant to section 68A of the Act the share component of each supplementary water access licence in the Deep Groundwater Source will be reduced to 0 ML on 1 July 2015. (3) Pursuant to section 77A of the Act supplementary water access licences will be cancelled after 1 July 2015.

39 Clause 25C of the plan thus distinguishes between (amongst other things) licences listed in Sch 5 and licences not listed in Sch 5 (see cll 25C(4) and (5)). The formula in cl 25C(5) results in an identified share component of an aquifer access licence (represented by SCAAL). Part of the formula concerns the history of extraction component (represented by HV). The formula for the history of extraction component includes the sum of the share components specified in column 3 of Sch 5 (represented by ΣEXC).

40 In other words, the share components in Sch 5 are factored into the formula yielding one of the integers for the calculation of each history of extraction component (or HV) regulated by cl 25C(5) and thus each share component outcome under that clause. The same proposition holds for all other amounts deducted from the recharge amount represented by PEW, LWU, SD, ΣSL, and ΣAV (being the sum of various other entitlements to water from the deep groundwater source prescribed by the plan).

41 Schedule 5 (also inserted by the amendment order, cl 25C(5)) is as follows:

Column 1 Column 2 Column 3 1912 Act Entitlement Licence(s) Aquifer Access Licence Share Component 40PT930061 40BL186295, 40BL190019 2405 40PT930572 40BL189576 1028 50PT940188 50BL196102, 50BL196791 3120 40PT930427 40BL186604 925

42 Schedule 5 is limited to the four groups of licences identified and does not include the applicants' bore licences.

43 The amendment order omitted cl 27 of the plan, relating to long-term extraction limits, and replaced it with a clause specifying the same volumetric limits as follows: 27 (1) This Division is made in accordance with section 20(2)(a) of the Act.

(2) The extraction limit for each groundwater source each year of this Plan is the recharge established in clause 16, minus the proportion of recharge reserved as planned environmental water in clause 18, plus total water made available to supplementary water access licences under clause 29, plus the total requirements for basic landholder rights at the commencement of this plan, and are initially as follows: (a) 10,000 ML/yr in the Shallow Groundwater Source, plus the total requirements for basic landholder rights at the commencement of this plan, and (b) 270,000 ML/yr in the Deep Groundwater Source, plus total water made available to supplementary water access licences under clause 29, plus the total requirements for basic landholder rights at the commencement of this plan.

44 The amendment order omitted cl 29 dealing with available water determinations and replaced it with a clause altering the relative priorities between various categories of licence.

45 According to cl 29 as amended: (1) … ( 3) All available water determinations in these groundwater sources shall be expressed as either: (a) a percentage of the share component for all access licences where share components are specified as megalitres per year, or (b) megalitres per unit of share component for all access licences where share components are specified as a number of shares. (4) An available water determination for each category of access licence in these groundwater sources should be made at the commencement of each water year. … (6) The available water determination made at the commencement of the water year for aquifer access licences should be such that the total of available water determinations under this clause for each groundwater source equals the extraction limit set in clause 27(2) as varied by clause 28 minus the total requirements for basic landholder rights, minus the total available water determinations for domestic and stock and local water utility access licences and supplementary water access licences, or such lower amount as results from the operation of clause 28A(3) or subclause (7). (7) The available water determination for all aquifer access licences in the Shallow Groundwater Source will not exceed 1 ML per unit of share component. (8) The available water determination made at the commencement of this plan for supplementary water access licences should be 0.9 ML per unit of share component. (9) The available water determination made at the commencement of each year after the 2006/07 water year for supplementary water access licences will be reduced by a further 0.1 ML per unit of share component, and (10) The available water determination for supplementary water access licences will be reduced to 0 ML per unit of share component at the commencement of the 2015/16 water year.

46 The 2006 Regulation amended the 2004 Regulation by (amongst other things) inserting Div 4 of Pt 3 and Sch 4A. The first provision within Div 4 of Pt 3, cl 29A, provides as follows: This Division applies to and in respect of each Part 5 entitlement referred to in Column 1 of Schedule 4A, and to and in respect of each access licence arising from any such entitlement, but not to any other entitlement or access licence.

47 A "Part 5 entitlement" is defined in cl 3 to mean a licence under Pt 5 of the 1912 Act.

48 Clause 29B provides as follows: (1) This clause applies for the purposes of clause 3(1)(a), and clause 8, of Schedule 10 to the Act. (2) On 1 October 2006, a Part 5 entitlement (or group of Part 5 entitlements) referred to in Column 1 of Schedule 4A is taken to have been replaced: (a) by an aquifer access licence with a share component of the volume specified in Column 2 of that Schedule, and (b) if a volume is specified in Column 3 of that Schedule, by a supplementary water access licence with a share component of the volume so specified. … (3) The volumes specified in Columns 2 and 3 of Schedule 4A in relation to any Part 5 entitlement (or group of Part 5 entitlements) have been calculated in accordance with whichever of the following methodologies is relevant to that entitlement or group of entitlements: (a)… (c) in the case of entitlements relating to the Lower Murrumbidgee Groundwater Sources within the meaning of the Water Sharing Plan for the Lower Murrumbidgee Groundwater Sources 2003, the methodology set out in clauses 25C and 25D of that plan.

49 Schedule 4A identifies numerous entitlements for three different groundwater sources. Under the heading "Lower Murrumbidgee Groundwater Sources" the applicants' bore licences under Pt 5 of the 1912 Act, along with other licences, are listed as follows:

Column 1 Column 2 Column 3 Part 5 entitlement Aquifer access licence Supplementary access licence Lower Murrumbidgee Groundwater Sources 40BL119208, 40BL186128, 40BL186229, 40BL187100, 40BL187101, 40BL188059, 40BL188060, 40BL188118, 9636 1427 40BL190747 40BL186524 743 40BL188655 566

50 By the method described above (assuming validity of the amendment order) entitlements (or former entitlements) of holders of a licence under the 1912 Act in the Lower Murrumbidgee Groundwater Sources were converted into an access licence under the Water Management Act. Specifically, bore licences were converted into aquifer access licences with the share components identified in Sch 4A to the 2004 Regulation (as amended on 1 October 2006).

51 In accordance with this process (assuming validity of the amendment order) the entitlements of the Tubbo applicants and the Harvey applicants under their respective bore licences were converted into aquifer access licences with a share component (expressed in ML per year) as follows: - Tubbo applicants' former entitlements: 20,742ML per year (subject to contrary Ministerial order). - Tubbo applicants' converted entitlements: a share component with an entitlement of up to 9636ML per year (depending on available water determinations under cl 29) and a supplementary access licence reducing from an entitlement of up to 1284ML per year (depending on available water determinations under cl 29) to zero by 2015/16. - Harvey applicants' former entitlements: 7045ML per year (subject to contrary Ministerial order). - Harvey applicants' converted entitlements: 1309ML per year (depending on available water determinations under cl 29).

52 There are many other groups of former entitlements identified in Sch 4A under the heading "Lower Murrumbidgee Groundwater Sources". Each group lists a bore licence number or numbers in column 1, an access licence share component in column 2, and (in some cases) a supplementary access licence in column 3.

C. The amendment and duration issues Grounds of challenge

53 The applicants' challenge on these grounds relates principally to cll 25C and 25D of the plan as inserted by the amendment order. Clauses 25C and 25D (quoted above) are in Pt 7 of the plan (as amended) dealing with requirements for water extraction under access licences (as required by s 20(1)(c) of the Water Management Act).

54 Before the amendment order was made, the plan dealt with the same requirement in cl 25, but in these terms: 25 (1) This Part is made in accordance with section 20(1)(c) of the Act. (2) At the commencement of this Plan, the requirements identified for water for extraction under access licences within these groundwater sources are estimated to be as follows: (a) 0 ML/yr in the Shepparton, and (b) 522,233 ML/yr in the Calivil and Renmark, (3) … (4) Pursuant to section 42(2) of the Act, and at the commencement of year six of this plan the Minister should reduce the total share components of aquifer access licences specified in subclause (2) in the Calivil and Renmark to 125% of the extraction limit determined in clause 27, according to the following; Amended access licence share component = access licence share component prior to amendment x ( (125(recharge - EHW))-LWU ) Total access licence share components prior to amendment -LWU

(5) Recharge in subclause (4) is the recharge established in clause 16(1), as amended by clause 16(2). (6) EHW in subclause (4) is the volume of recharge reserved as environmental health water in the Calivil and Renmark in clause 18(1), as amended by clause 18(2). (7) LWU in subclause (4) is the total of local water utility access licence share components in the Calivil and Renmark existing prior to any access licence amendments under subclause (4). (8) … (9) At the time of commencement of Part 2 of Chapter 3 of the Act, aquifer access licences in the Calivil and Renmark with a history of extraction greater than 80% of the aquifer access licence share component, as amended by subclause (4), will have a second licence, called a supplementary water access licence. (10) A supplementary water access licence referred to in subclause (9), will have an initial share component equivalent to the history of extraction, minus 80% of the aquifer access licence share component, as if amended by subclause (4). (11) The history of extraction referred to in subclauses (9) and (10) will be the greater of: (a) the average extraction over the seven water years from 1995/96 to 2001/02, or the average of the years within that period from which extraction was first measured, not exceeding the access licence share component equivalent in 2001/02, or (b) the average extraction over the five water years from 1997/98 to 2001/02, or the average of the years within that period from which extraction was first measured, not exceeding the access licence share component equivalent in 2001/02. (12) Share components of all supplementary water access licences will be reduced to 0 ML/yr at 30 June 2012. (13) …

55 The extraction limit in cl 27, as referred to in cl 25(4), referred to the figures of 10,000ML per year for the Shepparton and 270,000ML per year for the Calivil and Renmark, in similar terms to cl 27 as substituted by the amendment order (recognising that the amended plan refers to the Shepparton as the shallow groundwater source and the Calivil and Renmark as the deep groundwater source).

56 Access to water under these provisions was also subject to the making of an available water determination by the Minister. Clause 29 of the plan before the amendment order regulated these determinations by setting out a series of rules.

57 The formula in cl 25 before the amendment order would have resulted in across-the-board cuts to all water entitlements under bore licences converted into aquifer access licences. It is common ground between the parties that the formula in cl 25(4) would have yielded proportional reductions of the entitlements of holders of bore licences (to about 52% of their previous entitlements) unconnected to their history of extraction. This fact also has significance for the applicants' claims related to Sch 5 (see section D below).

58 The applicants submitted that: - (i) the amendment order, by substituting cll 25C and 25D for the provisions of cl 25, completely changed the basis for the allocation of entitlements to licence holders, (ii) on its proper construction s 45 of the Water Management Act does not authorise such a root and branch or radical amendment, in effect, so as to make a new plan that by-passed the plan making procedures (particularly s 18(1), which the applicants said the Minister had thereby failed to consider as required), (iii) further, s 45 does not permit the amendment of a plan that is not yet in force and effect, the consequence of which is to avoid the operation of ss 46 and 87AA of the Water Management Act relating to compensation, and (iv) in any event, the Minister also breached s 45(4) by extending the duration of the plan to 1 July 2017.

59 The applicants said that these submissions were supported by a number of considerations: - (i) neither the 1912 Act nor the Water Management Act vest rights of ownership of groundwater in the Crown, (ii) accordingly, the legislation should not be construed as interfering with landowners' common law rights of ownership of groundwater more than strictly necessary, (iii) ordinary principles of construction also indicate that where a particular procedure to achieve something is specified in legislation, other more general procedures are thereby excluded, and (iv) Parliament cannot have intended to permit such significant changes to a plan without compliance with the processes specified in ss 18, 46 and 87AA.

60 The respondent submitted that: - (i) the applicants' reference to construing legislation to minimise interference with common law rights is somewhat unreal and anachronistic; rights to groundwater have been regulated for many years and, in any event, are not the type of fundamental rights that would ordinarily attract this principle of construction, (ii) the applicants cited no authority for their principal proposition that the amendment exceeded the power in s 45, (iii) the legal notion of amendment is broad (Attorney-General for the State of Western Australia v Marquet (2003) 217 CLR 545 at [46]), (iii) nothing in the legislative scheme indicates that a narrow view of the power of amendment should be taken, (iv) to the contrary, the fact that amendments can be made by subsequent management plan (s 42(1)), "in the public interest", to reflect a "change in government policy", and may result in compensation (ss 42(1), 45(1), 46(1) and 87 - 87AB), as well as the capacity to amend a bulk access regime (s 45(7)), indicate that a broad view of the power should be taken, (v) the applicants had not established that the Minister failed to comply with s 18(1) but, in any event, the section did not apply to the amendment order, (vi) the Minister did not fail to comply with ss 46 or 87AA because neither provision applied, or could apply, to the amendment order, and (vii) the Minister did not breach s 45(4), as the duration of the plan was a consequence of the operation of the provisions of the Water Management Act.

61 The plan before and after the amendment order is a water sharing plan (ss 19 - 21). Both versions of the plan represent the implementation of the policy of the NSW government to address the unsustainable exploitation of groundwater resources that resulted from the controlled depletion policy. Both versions of the plan reflect the underlying concept that extraction and use of groundwater must be sustainable, with sustainability ultimately measured by the recharge capacity of the groundwater source. Both versions of the plan also reflect a policy decision, consistent with the water management principles (s 5) and the obligations imposed by s 9 of the Water Management Act, to give priority to water identified as required for environmental purposes, with users to share the remaining water consistent with priorities between users and the long-term extraction limit, and subject to available water determinations. The basis of both versions of the plan for the deep groundwater source (the Calivil and Renmark) is the long-term extraction limit of 270,000ML per year in circumstances where entitlements under the 1912 Act had been allocated for 512,409ML per year.

62 It necessarily follows from these facts underlying the plan (before and after its amendment) that many licence holders under the 1912 Act would be detrimentally affected by the policy change from controlled depletion to sustainable use. Nothing in the amendment order affected that policy change.

63 Accordingly, the plan before and after its amendment is directed towards achieving the sustainable use of a resource in circumstances where, first, the resource has a limited recharge capacity and, secondly, pursuant to earlier policies bore licences had been granted authorising extraction and use of that resource in a volume far exceeding the recharge capacity. Such a policy change has been recognised as inevitably creating "winners and losers" (Murrumbidgee Groundwater Preservation Association Inc v Minister for Natural Resources (2005) 138 LGERA 11 at [144]).

64 The amendment order altered the method by which the policy of sustainable use of groundwater would be achieved. It did so by replacing a formula involving proportional or across-the-board reductions based principally on entitlements to extract groundwater (cl 25(4)) with a formula involving reductions based principally on historical extractions of groundwater (cl 25C(5)). Subject to the potential ameliorating effect of various aspects of the formula (including the weighting of entitlements under the 1912 Act as part of the asset value protection or AV component and the alternative periods identifying the relevant average extractions in cl 25C(6)) this change in approach would inevitably create different "winners and losers". Those who could demonstrate use of their entitlements over the relevant periods would be likely to be better off than under a formula based on across-the-board cuts. Those who had entitlements that had not been used within the relevant periods would be likely to be worse off.

65 General principles of construction against interference with common law rights do not provide a ready answer to the issues raised by the applicants about the operation of the Water Management Act. As the respondent submitted, this approach has an air of unreality when the statutory, historical and practical context of the regulation of groundwater is considered (and see, by analogy, the observations in Telstra Corporation Ltd v Commonwealth (2008) 243 ALR 1 at [52]). The 1912 Act regulated the sinking of bores for the purpose of extracting groundwater from 1912. Before that the Artesian Wells Act 1897 operated. The rights to extract and use groundwater vested in the applicants are statutory in origin (Murrumbidgee Groundwater Preservation Association at [152]). The "cuius est solum" maxim relied on by the applicants to assert common law ownership of the groundwater has to be viewed in this context. No beneficial use could be made of the groundwater without the right to sink a bore and carry out extraction. Those rights have long been circumscribed by statute. Recognising the practical and legal context of the applicants' position involves no departure from the observations (relied on by the applicants) that where rights of individuals of sufficient significance are involved, doubts as to legislative intention should be resolved in favour of "an interpretation which safeguards the individual" (Buck v Comcare (1996) 66 FCR 359 at 364).

66 It is true that the amended provisions of the plan lead to different outcomes for licence holders. This follows from the fact that the share components for aquifer access licences under the plan as amended are the result of the application of a different formula embodying a different policy from that contained in the plan before its amendment. I do not accept, however, that the amendments were beyond the power vested in the Minister by s 45(1)(a). Consistent with the respondent's submissions, there are numerous indicators in the statutory scheme supporting a broad view of the power in s 45(1)(a).

67 First, the power in s 45(1) is to amend a plan (that is, the plan as a whole rather than any individual provision of a plan). The power may be exercised from time to time in the circumstances specified. These circumstances are diverse. Although the Minister relied on s 45(1)(a) alone in this case, the other circumstances specified are also relevant to the extent of the power of amendment. Under s 45(1)(b) the power to amend is constrained only by the provisions of the plan itself. Under s 45(1)(c) the only limit on the power is that the amendment be required to give effect to a decision of the Court relating to the validity of the plan. Under s 45(1)(a) the limit on the power of amendment is the Minister's satisfaction that it is in the public interest to do so. The "public interest" criterion would entitle the Minister to "range widely" (Terrace Towers Holdings Pty Ltd v Sutherland Shire Council (2003) 129 LGERA 195 at [81]). Further, s 45(3) requires the Minister to obtain concurrence from the Minister for the Environment to the amendment and s 45(7) contemplates that an amendment might vary a bulk access regime. All of these provisions support a view of amendment as encompassing material alterations to a plan.

68 Secondly, there are other indicators in the legislation that support this broad view. Under s 42(1) a management plan may also be amended by a subsequent management plan made in accordance with Pt 3. Section 46 contemplates that an amendment might reduce water allocations in a manner that triggers the compensation provisions.

69 Thirdly, a power to amend an instrument has been broadly construed in other contexts. The power to amend a plan must include a power to repeal particular provisions of the plan and make new provisions in their stead (Marquet at [46] and the cases cited therein). The idea of amendment constituting alteration without radical transformation relied on by the applicants (see, for example, Qantas Airways Limited v Aravco Limited (1996) 185 CLR 43 at 61 and Transport Action Group Against Motorways Inc v Roads and Traffic Authority (1999) 46 NSWLR 598 at [76], [84] and [105]) must be applied in the particular context identified above.

70 The effect and operation of the plan has been altered by the amendment, but the plan has not been extinguished. Its essential character as a water sharing plan remains. The matters with which its provisions deal also remain. The way in which the plan deals with one of those matters (requirements for water for extraction under access licences), in particular, is different. I accept that this matter is important. Nevertheless, the plan as a whole has not been extinguished or so radically transformed by the amendment as to be beyond the power of amendment in s 45(1)(a), when the statutory context of that power is considered.

71 Fourthly, the applicants' arguments about the amendment illegitimately by-passing provisions that would apply to a new plan (as opposed to an amendment) have to be assessed against the operation of the statutory provisions rather than the applicants' pre-conceived ideas about what approach the legislature should have preferred. Legislative intent is manifested "by the use of language" in the document to be construed (Wilson v Anderson (2002) 213 CLR 401 at [8]). Accordingly: …it is through the meaning of the text, understood in the light of background, purpose and object, and surrounding circumstances, that the legislature expresses its intention, and it is from the text, read in that light, that intention is inferred ( Singh v The Commonwealth (2004) 222 CLR 322 at [19]).

72 It follows from these observations that a general presumption about specific provisions excluding reliance on general provisions to achieve the same result cannot be mechanistically applied. The statutory provisions have to be construed in context and take their ordinary and natural meaning. They should not be approached assuming that Parliament took a narrower view of the power of amendment than the statutory provisions indicate. Once it is accepted that the amendment order was within the power of amendment in s 45(1)(a), it becomes apparent that the applicants' arguments based on ss 18, 46 and 87AA, to which I now turn, are unsustainable.

73 Section 45 is a freestanding power of amendment. The section is not to be read down because the Minister also has a power to make a plan (s 50). The constraint on the power in s 45(1)(a) is the Minister's satisfaction that it is in the public interest for the plan to be amended. The statute imposes no obligation on the Minister, when making an amendment order, to comply with s 18 (ss 45(1)(a) and 42(2)). In consequence, the applicants' argument depends on an approach that treats the matter in s 18(1) as indispensable to any state of satisfaction about the public interest. The applicants, however, did not claim that the Minister failed to form the required opinion other than in a most limited way. Rather, the applicants' arguments assumed that because the Minister relied on s 45(1)(a), the Minister necessarily failed to consider the socio-economic impacts of the proposals contained in the plan (as proposed to be amended). Further, that this failure was critical to the applicants because had the Minister considered the socio-economic impacts of the proposals the devastating effect on the applicants would have been apparent. In this limited way the applicants suggested that the Minister was not satisfied that it was in the public interest to amend the plan.

74 I do not accept that argument either as a matter of logic or on the facts. As noted, the "public interest" is a broad concept and, no doubt, would often include consideration of the socio-economic impact of proposals (as contemplated by s 18). However, consideration of that matter does not require the Minister to have regard to submissions about the particular impact of the plan on the financial position of individuals. Consistent with the respondent's submissions, the level of generality or specificity at which the Minister approaches the socio-economic impacts of proposals in a plan, as part of the public interest, is not prescribed by the statute and thus is a matter for the Minister (Foster v Minister for Customs and Justice (2000) 200 CLR 442 at [23] and O'Sullivan v Farrer (1989) 168 CLR 210 at 216). The expression "the public interest" has been described as particularly apt to vest a decision-maker with a wide power (Deloitte Touche Tohmatsu v Australian Securities Commission (1995) 54 FCR 562 at 579), calling up the interests of the public generally rather than the interests of any individual (Director of Public Prosecutions v Smith [1991] 1 VR 63 at 76 citing Sinclair v Mining Warden at Maryborough (1975) 132 CLR 473 at 480).

75 The applicants approached the issue of the public interest at a level of specificity not warranted by the statutory provisions. In any event, the applicants bore the onus. They have not established that the Minister failed to consider the socio-economic impacts of the proposals in the amendment order (at the potential level of generality at which that requirement may operate). These conclusions are also relevant to the resolution of the procedural fairness claims addressed below. Insofar as it might be necessary to say so I am satisfied the Minister formed the required state of satisfaction that it was in the public interest to amend the plan. The Minister's decision of 24 September 2006 records that state of satisfaction in terms.

76 Other difficulties attend the applicants' approach to s 45(1)(a). The applicants contend that the Minister used the amendment power to avoid the limitation that would otherwise apply in ss 46 and 87AA, whilst at the same time avoiding s 18. The language of "avoidance" is inapt. The Minister had a power of amendment and was entitled to exercise it. Section 18, as noted, did not condition that exercise of power. Section 46, in terms, depends on s 87AA applying ("in relation to which compensation might be payable under section 87AA…"). Section 87 deals with compensation where the relevant reduction occurs "during the period for which the first management plan that established the bulk access regime concerned is in force" (s 87(9)). Section 87AA deals with compensation where the relevant reduction occurs other than while the first management plan was in force (s 87AA(3)(a)).

77 The plan in this case first came into force on 1 October 2006 in its amended form (by cl 3 of Sch 1 to the amendment order). The plan was never in force in its unamended form. Accordingly, there are no rights of compensation in accordance with ss 87 or 87AA. Instead, this situation is governed by s 87AB, which excludes any compensation for conduct (such as the change in government policy from across-the-board cuts to a history of extraction) before the plan commenced. Sections 45(4) and 87AB also undermine the applicants' argument that the power in s 45(1)(a) is not available before a plan commences.

78 As the respondent submitted, the applicants only became the holders of an access licence on 1 October 2006, by dint of the provisions discussed above. The applicants' bore licences are not access licences for the purposes of the Water Management Act (see the Dictionary to that Act). For these reasons, the applicants' water entitlements were not reduced as a consequence of the variation of a bulk access regime (s 87) or reduced while the first management plan was in force (s 87AA). The circumstances of this case could never have attracted the operation of ss 46 or 87AA; there was nothing for the Minister to avoid.

79 The other point pressed by the applicants relating to these issues concerned the duration of the plan. The applicants submitted that the Minister, by cl 3 of the amendment order, extended the duration of the plan in breach of s 45(4). But for the amendment the plan would have continued for 10 years from 1 October 2006 (cl 3 of the plan before its amendment). By cl 3 as amended the Minister extended the duration of the plan until 30 June 2017. According to the applicants, s 43(1)(b) is no answer because, if applicable, it would mean that the plan did not commence until 30 June 2007, in which event the conversion of the applicants' entitlements from bore licences into aquifer access licences also could not have occurred on 1 October 2006.

80 These arguments cannot be sustained, essentially for the reasons given by the respondent. Section 43(1) is clear. If the commencement date of a plan is other than 1 July then the plan has effect for 10 years from 1 July next after the date the plan commenced. The provision deals only with the duration of a plan, not its commencement. The plan is effective from commencement (whatever its commencement date) and then continues in effect for either of the two nominated periods. In this case, because the plan (as amended) commenced on 1 October 2006, the plan remains in effect until 30 June 2017 by operation of s 43(1)(b). The Minister did not, by cl 3 of the amendment order, extend the duration of the plan. The duration of the plan simply reflects s 43(1)(b).

81 The applicants' approach to s 43(1)(b) assumes that the section operates to defer the operation of plans commenced other than on 1 July to the next 1 July. Construed in context, s 43(1)(b) does not have that effect. Plans commence on publication or such later date as may be specified in the plan (s 41(3)). Once commenced, they take effect. Section 43 regulates the period for which they remain in effect. That period may not be extended (subject to s 43A, which is not relevant to this case). The Minister did not extend the duration of the plan in breach of s 45(4). D. Procedural fairness Grounds of challenge 82 The applicants submitted that the amendment order was made in breach of the Minister's obligation to give the applicants procedural fairness. The central aspect of this claim was Sch 5 to the amendment order.

83 The applicants said Sch 5 reflected the Minister's decision that certain holders of bore licences were in a position of "special circumstances". Licence holders identified by Sch 5 were granted an aquifer access licence with a share component in accordance with the position they would have enjoyed had the plan not been amended (in effect, a share component reflecting the position of across-the-board reductions to 52% of former entitlements). Further, the sum of these water entitlements in Sch 5 became an integer in the formula used to determine each and every other licence holders' history of extraction component and, thereby, share component. This is because one step in the calculation of HV (or history of extraction component) in cl 25C(5) is reached by deducting, amongst other things, ΣEXC (the sum of the share components in column 3 of Sch 5) from the recharge amount. By this method, each and every licence holders' share component is reduced, to some extent, by the components vested in the licence holders separately dealt with in Sch 5 (with the consequence that Sch 5 is not severable).

84 The applicants were holders of bore licences not included in Sch 5. The applicants contend that Sch 5 gave rise to an obligation on the Minister's part to give procedural fairness because: - (i) including Sch 5 in the plan involved the singling out of individuals and dealing with their interests, as individuals, in a manner substantially different from the manner in which other holders of bore licences were dealt with pursuant to the general rule established by cl 25C(5), (ii) the nature of the interests affected was the conversion of bore licences held by individuals, to which important entitlements (to extract groundwater) were attached, (iii) Sch 5 thus has the character of a decision on individual rights rather than a legislative act applying equally to all, (iv) the fact that provisions of a statute may reflect some of the requirements of procedural fairness is insufficient to indicate any legislative intention to exclude the common law, (v) s 47(5) shows that the legislature turned its mind to the requirements of procedural fairness and contemplated (and certainly did not exclude) their application to plan-making functions, and (vi) the applicants were effectively invited to have their individual positions dealt with as potentially constituting an anomaly or special circumstances.

85 According to the applicants, the Minister did not give the applicants procedural fairness because: - (i) the applicants were never told by any of the many, varied (and confusing) bodies and committees involved in the amendment process of the criteria to be applied to determine the existence of special circumstances so as to become eligible for inclusion in Sch 5, (ii) indeed, those criteria were deliberately withheld from the applicants so that their submissions did not address the criteria, with the consequence that they only became aware of the criteria after the amendment order had been made, when it was too late, (iii) the applicants were never told about the nature or content of any material relied on by those bodies and the Minister (including recommendations from those bodies and the reasons for them) to determine that the applicants were not eligible for special circumstances and inclusion in Sch 5, (iv) in any event, that material was an inaccurate and incomplete summary of their individual circumstances, (v) the various bodies considering the issue of special circumstances and making recommendations to the Minister were not authorised by the Water Management Act to do so and acted on criteria not approved by the Minister and, indeed, inconsistent with the criteria or "key principles" that had been approved (namely, to recognise water-dependent investment made by licence holders and that all groundwater entitlements, whether extracted or not, have value), (vi) those bodies inflexibly applied a policy for determining special circumstances (namely, the criteria not disclosed to the applicants), (vii) the applicants were never given reasons for their ineligibility for special circumstances and consequential exclusion from Sch 5, and (viii) had the applicants been notified of the criteria they were required to meet both would have submitted information capable of establishing the existence of special circumstances but, by reason of the denial of procedural fairness, lost the opportunity to do so.

86 The Harvey applicants relied on additional submissions to the effect that: - (i) by reason of the procedural defects identified above, the Harvey applicants' claim for special circumstances was never identified and thus never considered as such, (ii) people involved in the decision-making process made inquiries of and obtained information from third parties about the Harvey applicants' position, without the Harvey applicants being informed or given an opportunity to comment on that information, and (iii) the committee that initially determined requests for special circumstances (albeit not being authorised to do so) concluded adversely to the Harvey applicants that they had not identified the issue they were disputing. The committee did so without giving the Harvey applicants the opportunity to respond to the alleged omissions in their information (in contrast to other licence holders who were given that opportunity, were determined to be eligible for special circumstances, and thus became subject to cl 25C(4) and Sch 5 rather than the general formula in cl 25C(5)).

87 The applicants denied the respondent's submission (going to discretion) that the effect of invalidity of the amendment order would be that the plan operated in its unamended form. According to the applicants the provision that effected the conversion of bore licences under the 1912 Act is cl 3 of Sch 10 to the Water Management Act (which provides that entitlements under the 1912 Act are taken to have been replaced as identified). The pre-condition to the conversion in cl 3(1)(a)(ii) is an indication of a quantity of water different from an entitlement under the 1912 Act in both a water management plan and regulations made for the purpose of cl 3(1)(a)(ii). The 2004 Regulation (as amended by the 2006 Regulation) identifies the applicants' share component as consisting of a quantity of water different from that in the plan before its amendment. Hence, a water management plan and regulation for the purposes of that clause do not both indicate a different quantity of water. The pre-condition in cl 3(1)(a)(ii) is not satisfied. The consequence is that the deeming effect of cl 3(1)(a)(ii) has not been triggered. The applicants' rights under their bore licences thus remain. Alternatively, the respondent's approach if the amendment order is invalid assumed the existence of an available water determination with respect to the plan before the making of the amendment order when there was no evidence of such a determination. The respondent's approach also failed to recognise that an available water determination is only relevant where a licence relates to a specified proportion of water rather than a specified volume (see s 56(2)). Even if cl 3(1)(a)(i) of Sch 10 applies the applicants' aquifer access licences would be for a specified volume of water not a specified proportion of water.

88 The applicants also denied the respondent's contention of consequential chaos in that: - (i) the plan had been deferred from commencement for a long period to enable work to be completed, (ii) the work simply remained incomplete (because of the denial of procedural fairness), (iii) the Minister could make a new plan in accordance with law, (iv) the only consequence of invalidity of the amendment order for third parties is that all licence holders will still retain their entitlements under the 1912 Act unless and until a plan is made (by reason of the operation of cl 3(1)(a)(ii) discussed above), (v) the discretionary grounds on which the respondent relied were outside the class ordinarily relevant where jurisdictional error is demonstrated, (vi) the evidence does not disclose the assumptions of third parties involved in trading of water rights, and (vii) the respondent's discretionary arguments would effectively set aside the terms of s 47, which provide a period of three months for any challenge to the validity of a plan (these proceedings having been commenced within the three month period).

89 The respondent submitted that the Minister had no obligation of procedural fairness with respect to the making of the amendment order because: - (i) whilst not determinative, the activity of making and amending a plan is essentially legislative in character as plans are intended to contain general rules applying to the State or large areas of the State, (ii) the criteria for activating the amendment power is not conditioned upon the right or interest of any individual but, rather, broad considerations (relevantly, in this case, the Minister being satisfied the amendment was in the public interest), (iii) the power in s 45 is also not conditional on consultation subject to ss 45(3) and (7), and (iv) this may be contrasted with s 42 and a number of other provisions expressly providing for rights of consultation (for example, ss 67 and 102).

90 The respondent also submitted that: - (i) the distinction drawn by the applicants between the position under cl 25C(5) and under cl 25C(4) and Sch 5 is illusory because every aspect of a plan is liable to affect the ultimate interests of every licence holder and thus may create "winners and losers" (which is inevitable given the fact the plan is a water sharing plan of a limited resource), (ii) even the determining of policies and criteria themselves are likely to have that differential effect, with the consequence that, on the applicants' arguments, they had a right to be heard abut the policies and criteria as well, (iii) it would be strange if a failure to notify the persons nominated in s 36(2) could lead to invalidity by denial of procedural fairness when s 36(3) provides that failure to so notify does not invalidate a plan, and (iv) it would be more strange if the Minister decided that the notification and exhibition requirements should not apply (as authorised by s 50(2A)) and then could be found to have denied procedural fairness by doing that which Parliament expressly authorised.

91 The respondent said s 47(5) did nothing more than ensure this Court has jurisdiction to deal with any challenge based on this ground, thereby overcoming the issue in Warringah Council v Edmondson [2001] NSWCA 1 (as indicated by s 47(7)).

92 The respondent submitted further that, if the rules of natural justice are attracted to these functions, they are apt to create chaos. Plans apply to large areas of the State and many people could be affected by setting aside a plan or amendment because one individual was not notified, properly informed of something, told about adverse material or the like. The respondent also asked (rhetorically) at what stage the duty arose, how it would align with the statutory provisions requiring notification, consultation and exhibition, and to whom the duty was owed. Finally, the respondent observed that it would be a strange incentive for the Minister to be better off by not attempting to deal with individual hardship cases (attracting the rules of natural justice) than otherwise. Accordingly, the Minister was entitled to inform himself and apply criteria as he saw fit untrammelled by any obligations of natural justice.

93 Alternatively, the respondent submitted that, if any duty of procedural fairness attached to the making of the amendment order, then the Minister complied with that duty as: - (i) procedural fairness can be given through other bodies such as committees, (ii) the applicants were invited to make submissions on 21 December 2005, (iii) the applicants had the opportunity to vote in the referendum on weighting options between active and inactive water in April 2006, (iv) both applicants in fact made numerous submissions that were considered by various bodies, including the Minister who must have been well aware of their particular concerns, (v) there is no evidence of any particular information or conclusion adverse to the applicants other than the decision not to include the applicants in Sch 5, and (vi) in any event, there is no obligation to inform parties of preliminary conclusions or thought processes.

94 As to the issue of reasons, the respondent submitted that there is no general duty to provide reasons for administrative (let alone legislative) action and nothing in the statutory scheme to give rise to any contrary implication (Public Service Board of New South Wales v Osmond (1986) 159 CLR 656, Campbelltown City Council v Vegan (2006) 67 NSWLR 372, Riverina Wines Pty Ltd v Registrar of the Workers Compensation Commission of New South Wales [2007] NSWCA 149 at [109] - [114]).

95 The respondent also observed that the facts did not disclose any substantial practical injustice to the applicants. If the amendment order is invalid and the applicants are correct about cl 3(1)(a)(ii) of Sch 10 to the Water Management Act, then cl 3(1)(a)(i) applies so that the applicants' bore licences are taken to have been replaced by aquifer access licences for the quantity of water specified in the applicable bore licences. Hence, the Water Management Act (and not the 1912 Act) would still regulate the applicants' rights of extraction. Under s 59(1)(a) of the Water Management Act, a licence holder cannot make any extractions without the Minister making an available water determination (see also ss 85 and 341(1)). Further, water allocations are determined in accordance with the priorities established by s 60(1) (including cl 29(2) of the plan before its amendment). The water available for allocation thus would remain 270,000ML per year from the deep groundwater source as provided for in cl 27 of the plan before its amendment. In other words, the applicants can only ever be allocated their pro-rata share of, at best, 270,000ML per year (assuming that full amount is the subject of an available water determination). Hence, the applicants' position would not revert to their full entitlements under the 1912 Act (and nor would that of the many other licence holders subject to the plan).

96 The respondent relied on other discretionary considerations against granting the applicants relief. The plan as amended commenced on 1 October 2006. Some 176 licence holders are subject to the plan (according to the number of eligible voters in the ballot on weighting that was part of the consultative process). Structural payments of $5.4 million had been offered (with $1.69 million already paid). There had been 154 temporary trades in the deep groundwater source (worth $1,005,742) in the 2006/07 year. There had also been five permanent trades (worth $912,900), and two permanent transfers of access licences (worth $695,250). Weighed against these factors, the applicants' positions would be as discussed above.

97 The different position if the applicants had been in Sch 5 (providing entitlements the equivalent of the plan before its amendment) was insufficient to outweigh these considerations. The respondent calculated that the Tubbo applicants' entitlements under the plan as amended were greater than their entitlements under the plan before its amendment in year 1 (by 80ML) and less in year 10 (by 1204ML). The Harvey applicants' entitlement under the amended plan is 2372ML per year less than they would have received under the plan before its amendment.

98 Other than in one material respect, the dispute between the parties centred on the application of the principles relating to procedural fairness rather than the principles themselves. The dispute as to principle concerned the question of the application of the duty. The applicants maintained that a single statutory power might or might not be subject to the duty depending on the circumstances relevant to the particular exercise of power. The respondent maintained that there had to be a single and consistent answer to the question whether a particular power attracted the duty. That is, the duty either applied to a power or not. If it applied, the content of the duty could vary but not its existence. I return to this issue after identifying the relevant principles and factual circumstances.

99 The common law duty to act fairly attaches to an exercise of public power affecting a person's rights, interests or expectations in a direct and immediate way, subject to a clear manifestation of contrary intention (Kioa v West (1985) 159 CLR 550 at 584).

100 The duty relates to the process by which a statutory power is exercised and not the outcome of any such exercise. This follows from the fundamental principle that: The duty and jurisdiction of the court to review administrative action do not go beyond the declaration and enforcing of the law which determines the limits and governs the exercise of the repository's power…The merits of administrative action, to the extent that they can be distinguished from legality, are for the repository of the relevant power and, subject to political control, for the repository alone. ( Attorney-General (NSW) v Quin (1990) 170 CLR 1 at 35 - 36. See also SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs (2006) 228 CLR 152 at [25]).

101 The authoritative test for the application of the requirements of procedural fairness is whether the exercise of power may destroy, defeat or prejudice a person's rights, interests and legitimate expectations (Vanmeld Pty Ltd v Fairfield City Council (1999) 46 NSWLR 78 at [53] citing Annetts v McCann (1990) 170 CLR 596 at 598 and Ainsworth v Criminal Justice Commission (1992) 175 CLR 564 at 576. See also Lesnewski v Mosman Municipal Council (2005) 138 LGERA 207 at [56] - [57]).

102 Characterising a statutory power as involving the exercise of a legislative function does not provide any necessary answer to the question whether the power is conditioned on observance of procedural fairness. As Gibbs CJ observed in Bread Manufacturers of New South Wales v Evans (1980) 180 CLR 404 at 416: To make the question whether the rules of natural justice apply depend on the classification of the power seems only to introduce a distracting complication into the process of decision.

103 But there is a significant distinction between decisions that directly and immediately affect a person individually and decisions that affect a person simply as a member of the public or a class of the public. The legislature is more likely to intend that the exercise of power of an executive, administrative or quasi-judicial nature be conditioned on the observance of procedural fairness if it "singles out individuals by affecting their interests in a manner substantially different from the manner in which the interests of the public at large are affected" (Kioa v West at 620).

104 Procedural fairness obligations are unlikely to attach to policy or political decisions affecting all members of the public or a class of the public in the same way, as the effect on the individual citizen in these cases is not "direct and immediate" (Kioa v West at 584 - 585 and 620. See also Bread Manufacturers at 416 - 417 citing Salemi v Mackellar [No. 2] (1977) 137 CLR 396 at 452, Botany Bay City Council v Minister of State for Transport and Regional Development (1996) 41 ALD 84 at 98, Comptroller-General of Customs and Another v Kawasaki Motors Pty Ltd (No 1) (1991) 32 FCR 219 at 239, White v Ryde Municipal Council [1977] 2 NSWLR 909 at 921, Minister for Urban Affairs and Planning v Rosemount Estates Pty Ltd (1996) 91 LGERA 31 at 91, Save the Showground for Sydney Inc v Minister for Urban Affairs and Planning (1997) 95 LGERA 33 at 51 - 53, and Vanmeld at [73]).

105 Kawasaki Motors provides a good example of the operation of this principle. The revoked order applied to "goods of a particular description regardless of the identity of the importer, the local manufacturer of competing goods, the suppliers, customers, employees or creditors of such persons or any other person who might be commercially affected" (at 240). It did so in a context of the "the enduring contest waged between the forces of free trade and protection" (at 241). Accordingly, the rules of natural justice were inapplicable, a conclusion reinforced by other aspects of the statutory scheme authorising requests for review by affected persons. Similarly, in Botany Bay City Council the fact that the decision about the runway would impact the residents of two local government areas was beside the point. The impact of the decision on those residents, who were sections of the public represented by the applicants, was indiscriminate. Accordingly, there was no direct and immediate impact on those residents as individuals. The rules of natural justice did not apply. Both decisions also implicitly recognise that a decision may in fact impact on people differentially and yet be indiscriminate in the relevant sense. For example, in Kawasaki Motors it did not matter if the respondent was the only importer of the relevant item (but note the reference in Vanmeld at [71] to considerations of substance rather than form if an exercise of power, although general in form, is in fact directed to an individual case). In Botany Bay City Council it did not matter that increased noise would affect some residents in the relevant areas more than others.

106 Another example is Gardner v Dairy Industry Authority of New South Wales [1977] 1 NSWLR 505. The system for distribution of milk involved a quota in which registered persons had proportionate shares fixing their share of the total milk consigned to the market. The quota determined the remuneration a registered person would receive for their milk. By a series of administrative decisions the quota system was altered. Hutley JA described it as "inconceivable that each individual dairyman should have the right to be heard on these matters, no matter how seriously the scheme or variation may affect him, because of the sheer magnitude of the task" (at 518G - 519A). He was also concerned that any such right would "provide an effective brake upon frequent variations" when the legislation contemplated variations from time to time. Samuels JA described the powers relating to the distribution of milk as involving questions of "political policy and economic planning", "liable to be influenced by a number of considerations, foreseen and unforeseen" (at 533C - E). Mahoney JA observed that a court should be slow to hold the principles of natural justice inapplicable (at 550E - G). He resolved the dispute at the level of the content of the duty concluding, on the facts of the particular exercise of power, that fairness did not require an opportunity to present an individual case or present a case individually (at 552C).

107 Further, if the impact on individual interests is a consequence of a Minister "exercising a discretion in the particular case by reference to the interests of the general public" then one may have entered the "political field" where policy questions may be determined free from procedural constraints (State of South Australia v O'Shea (1987) 163 CLR 378 at 411). See also the discussion in Transport Action Group Against Motorways Inc at [88] to [102].

108 These are examples of statutory powers recognised as involving a "quasi-legislative" or "polycentric" or "multi-factorial" or "political" function (Minister for Local Government v South Sydney City Council (2002) 55 NSWLR 381 at [18]), to which the duty of procedural fairness does not apply.

109 Where, however, a statute confers a power directly and immediately to affect rights, interests or legitimate expectations of people in an individual capacity the presumption that the legislature intended procedural fairness to be observed is strong (Haoucher v Minister of State for Immigration and Ethnic Affairs (1990) 169 CLR 648 at 652). The presence in a statutory scheme of requirements commensurate with some of the rules of procedural fairness is not necessarily taken to indicate a legislative intention to exclude procedural fairness as the legislature is not presumed to have intended such exclusion by "indirect references, uncertain inferences or equivocal considerations" (Annetts v McCann at 598, citing Commissioner of Police v Tanos (1958) 98 CLR 383 at 395 - 396). The relevant issue is the nature of the power, rather than the way in which it might usually be exercised (Vanmeld at [62]).

110 Moreover, it "should not be assumed that the exercise of a power conferred in general terms cannot be confined by the procedures adopted by a repository. If the power must be exercised in conformity with the rules of natural justice, a failure by the repository to adhere to a declared procedure may constitute or result in a failure to accord natural justice to a person whose interests are liable to affection by the exercise of the power" (Darling Casino Limited v New South Wales Casino Control Authority (1997) 191 CLR 602 at 609). See also Quin at 39 and Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam (2003) 214 CLR 1 at [82]).

111 Because procedural fairness "conveys the notion of a flexible obligation to adopt fair procedures", the "need for a strong manifestation of contrary statutory intention in order for it to be excluded becomes apparent". It follows that the question is usually what the duty requires rather than whether it applies (Kioa v West at 585).

112 The duty (if it exists) is subject to the "particular statutory framework", which must be given "full effect" (Mobil Oil Australia Pty Limited v Federal Commissioner of Taxation (1963) 113 CLR 475 at 504). This is because the requirements do not involve a "fixed body of rules" and fairness "is not a one-sided business" (Mobil Oil at 504). Close consideration of the statutory framework is required or the debate may take place at too high a level of abstraction (SZBEL at [26]). The requirements, if applicable, are flexible and must be "moulded" to the circumstances of the particular case (Kioa v West at 585 and Applicant VEAL of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs (2005) 225 CLR 88 at [25]). Hence, procedural fairness may require different "procedures…even of the same repository of power, from one situation to the next" (Lam at [48]). See also Commissioner for Australian Capital Territory Revenue v Alphaone Pty Ltd (1994) 49 FCR 576 at 590). In considering the statutory scheme "it is necessary to pay regard to the practical context in which the decision-maker must consider whether to exercise the power" (Re Minister for Immigration and Multicultural Affairs; Ex parte MIAH (2001) 206 CLR 57 at [29] - [31]). The "circumstances of the case, the nature of the inquiry and the subject-matter being dealt with" are all relevant to the content of the duty (South Sydney City Council at [254]). The duty may be "reduced to nothingness by the circumstances in which a power is exercised" (Kioa v West at 616).

113 While circumstances relevant to the requirements applicable in any case may include a person's expectations, references to legitimate expectations need to be understood in light of Lam. The judgments in Lam (at [48], [81] - [83], [111], and [140]) stress that, given the development of the law to the point where decision-makers must afford procedural fairness unless a clear legislative intention to the contrary is apparent, references to legitimate expectations are of limited utility.

114 The fundamental principle if the duty applies is that a party liable to be directly affected be given an opportunity to be heard. This would "ordinarily require the party affected to be given the opportunity of ascertaining the relevant issues and to be informed of the nature and content of adverse material" (Alphaone at 590 - 591. See also Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Palme (2003) 216 CLR 212 at [22] and SZBEL at [32] citing Alphaone). This involves an entitlement to have the party's mind "directed to the critical issues or factors on which the decision is likely to turn" if those matters are not obvious from the nature of the decision or the terms of the statute under which it is made (OzEpulse Pty Ltd v Minister for Agriculture, Fisheries and Forestry (2007) 163 FCR 562 at [55] - [56]).

115 Administrative decision-making is "not necessarily to be held invalid because the procedures of adversary litigation are not fully observed" (Kioa v West at 628 - 629 and South Sydney City Council at [251]). Nor must a decision-maker disclose their "thinking processes or proposed conclusions" (Victims Compensation Fund Corporation v Nguyen (2001) 52 NSWLR 213 at [40]). The decision-making process must be viewed in its entirety. If the process as a whole is fair then that suffices to discharge the duty (Ainsworth at 578).

116 The nature of the task may require the decision-maker to use other persons and bodies in the decision-making process as part and parcel of the ordinary processes of government (FAI Insurances Limited v Winneke (1981) 151 CLR 342 at 416 - 417, Minister for Aboriginal Affairs v Peko-Wallsend Limited (1986) 162 CLR 24 at 30 - 31, Tickner v Chapman (1995) 57 FCR 451 at 462 - 465, 476 - 477, and 493 - 497, and South Sydney City Council at [211]).

117 Hence, the "concepts of natural justice and the duty to be fair must not be allowed to discredit themselves by making unreasonable requirements and imposing undue burdens" (McInnes v Onslow-Fane [1978] 1 WLR 1520 at 1535).

118 If the duty applies, compliance constitutes a condition of the exercise of the decision-making power. Breach involves jurisdictional error (Plaintiff S157/2002 v Commonwealth of Australia (2003) 211 CLR 476 at [25]). Breach of the duty, however, does not automatically result in invalidity. Breach is established by actual unfairness or practical injustice, a question to be answered in all of the circumstances of the case (Lam at [37] - [38], [48], and [111]). Where the rules apply, the relevant question is whether breach of the rules deprived the person affected of the possibility of a successful outcome (Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82 at [104] citing Stead v State Government Insurance Commission (1986) 161 CLR 141 at 145). Discretionary considerations might also be relevant (Aala at [55] - [59] and Vanmeld at [78]).

119 The plan was made by publication in the Gazette on 26 February 2003 (s 41 of the Water Management Act). The plan applies to a large area between the towns of Narrandera, Booligal, Balranald and Jerilderie. Departmental records show that about 176 separate people or bodies hold licences relating to groundwater sources regulated by the plan (with about 393 separate licences).

120 As discussed above, amongst many other things, the plan was a necessary step in the conversion of bore licences to aquifer access licences. Existing entitlements under bore licences were to be replaced by aquifer access licences with share components reflecting approximately 51.4% (usually referred to as 52%) of the existing entitlements. The plan thus reflected a policy of across-the-board cuts in groundwater extraction entitlements. This policy attracted controversy and litigation (for example, Murrumbidgee Groundwater Preservation Association). The plan, as noted, did not commence in this form. Instead, on 1 October 2006, the amendment order commenced the plan in its amended form as one part of a statutory scheme involving the proclamation under s 55A (applying Pt 2 of Ch 3 of the Water Management Act to the Lower Murrumbidgee Groundwater Sources) and the 2006 Regulation amending the 2004 Regulation (by specifying quantities of water different from existing entitlements for the purposes of cl 3(1)(a)(ii) of Sch 10 to the Water Management Act). By this scheme all licence holders in this groundwater source were subject to the transitional regime in Sch 10 converting bore licences into aquifer access licences of varying share components. As the events described below disclose, the area the subject of the plan was one of six regions dealt with under the provisions of the Water Management Act between 2004 and 2006. This broader context must be kept in mind when considering the process leading up to the making of the amendment order.

121 The plan was initially scheduled to commence on 1 July 2003 (cl 3). Commencement, however, was deferred on numerous occasions as follows: (1) On 17 June 2003, commencement was deferred until 1 January 2004 due to the Commonwealth's recently announced proposed national water plan. The Minister explained that the NSW Government considered that a policy initiative in co-operation with the Commonwealth warranted deferral of commencement despite the interest of licence holders in achieving clarity and certainty as soon as possible.

(2) On 28 October 2003, commencement was deferred until 30 June 2004 to provide more time to develop the national water plan.

(3) On 30 June 2004, commencement was deferred until July 2005. The Regional Director of the Department announced that the NSW Government was considering ways of minimising impacts of the required reduction in allocation of the groundwater source on regional economies by "greater acknowledgement of historical use". The deferral would allow discussions about historical use between the NSW Government and Commonwealth to continue and give the required time to work through the issues associated with an approach to reducing allocations on that basis.

(4) On 10 August 2005, the Department announced that commencement was deferred until July 2006.

(5) Commencement was deferred thereafter until 1 October 2006 (apparent from the face of the plan immediately before its amendment). 122 In the meantime, on 4 March 2004, the NSW Cabinet decided to change the policy based on across-the-board cuts to a policy recognising historical extraction (consistent with the Commonwealth's preferred approach). This change of policy was not made public at this time other than to the extent of the Department's announcement on 30 June 2004 referred to above. The Commonwealth, States and Territories executed an Intergovernmental Agreement on a National Water Initiative on 25 June 2004. This agreement included obligations to address over-allocated water resources by adjustment through water plans.

123 On 28 June 2004 the Minister approved a schedule of delegations including a delegation to the Director-General to establish committees under s 388 of the Water Management Act.

124 By 5 August 2004, a body called the Groundwater Adjustment Committee (or GAC) was established to provide advice to the Director-General of the Department and Minister. The genesis of this committee is unclear but it involved numerous Departmental officers, representatives of relevant catchment management authorities, the chief executive of the NSW Irrigators' Council (which I understand to be an industry representative body), a representative of the Commonwealth, and others. The GAC's objectives included considering proposals for methods to reduce entitlements on the basis of history of use. Its functions included providing advice on these potential methods and processes and guidelines for assessing anomalies arising from the methodologies. According to the GAC's terms of reference the catchment management authorities were to be responsible for consulting with water user groups and licence holders about methodologies for reducing entitlements and related assistance. The catchment management authorities were also identified as responsible for reviewing the water sharing plans and making recommendations to the Minister about the plans. The GAC was to assist the catchment management authorities in their allotted tasks.

125 In June 2005 the Commonwealth and NSW Governments announced an Achieving Sustainable Groundwater Entitlements Program (or ASGE program), including a financial assistance package to help water users manage the reduction in their entitlements.

126 By July 2005 at least two other committees had been established, the Groundwater Adjustment Advisory Committee and the Groundwater Adjustment Officials Committee (known as the GAAC and GAOC respectively). The objectives of the GAAC included considering proposals for alternative entitlement reduction methods based on history of extraction or equivalent methods and consequential changes to water sharing plans. Its specific functions included advising the GAOC on these methods and related issues and "processes and guidelines for assessing special circumstances arising from entitlement reduction and assistance methodology". Membership of the GAC and the GAAC was similar.

127 The GAAC met on 18 October 2005 and dealt with numerous issues. One issue on its agenda (apparently as a result of an earlier GAAC meeting) was defining an "anomalies process and how it would operate to finalise HOE and late developers". HOE means history of extraction. "Late developers" is a reference to one of the potential problems of basing reductions on history of extraction, namely, that a period for extraction must be identified, and people developing later in that period may not have been able to use as much of their allotted water as those who had developed earlier. Consistent with a recommendation made to it (I infer by the Department) the GAAC decided to establish six regional groundwater verification committees for the six regions involved. The GAAC proposed that the Department would resolve issues about history of extraction in the first instance. The regional groundwater verification committees would deal with issues not capable of resolution by the Department.

128 In late December 2005 the Minister released an information package about the ASGE program. The Regional Director of the Department forwarded an information package to each licence holder across the six regions, including the applicants. The covering letter for the Murrumbidgee region described the ASGE program, including the policy of reducing entitlements with the introduction of "weighting" for groundwater dependent investment. The letter requested that the licence holder identify any discrepancies between the enclosed Department's history of extraction records and that of the licence holder by 1 March 2006. The letter said the Department would review the information and contact the licence holder to resolve any discrepancies. If the discrepancy could not be resolved, a regional groundwater verification committee would review the estimates and provide advice to the Department on the issue. After this consultation process the licence holder would be informed of their share component, any supplementary water access licence and any financial assistance, after which existing licences under the 1912 Act would be converted to an aquifer access licence and, if applicable, a supplementary water access licence under the Water Management Act. The enclosed forms contained a table with a year column from 1995/1996 to 2002/2003, a column headed "Metered Extraction" with two sub-columns headed "DNR Records" and "Your records" and a column for "Comments". The form also contained a note under the table to the effect that a licence holder could elect to have concerns referred to the regional groundwater verification committee if they believed the Department had not satisfactorily resolved their issues about their history of extraction.

129 The information package forwarded to each licence holder identified the key principles of the ASGE program as to recognise: - (i) water-dependent investment made by licence holders, and (ii) that all groundwater entitlements, whether extracted or not, have a "value". The information package further identified the "weighting" concept as relating to active (that is, extracted) and inactive (not extracted) groundwater forming part of the formula by which share components based on history of extraction would be determined. The information package also referred to the form identifying the Department's historical extraction record for the licence in similar terms. With respect to the Lower Murrumbidgee Groundwater Source, the information package identified the definition of history of extraction (involving the years 1995/1996 to 2001/2002), and the rules for its determination.

130 The NSW Irrigators' Council also sent a letter to NSW groundwater entitlement holders at about this time emphasising the importance of responding to the Departmental letter by identifying any discrepancies between the Department's history of extraction and that of the entitlement holder.

131 The applicants responded by completing the comment section of the forms. The Tubbo applicants noted (with some variations on the details of the individual licences) that they did not own the properties in the earlier years dealt with on the forms, were then involved in a capital development program over the period of 1999 to 2002, and could effectively use the property from only about 2003 onwards. The Harvey applicants noted the failure of a bore and the prohibitive expense of a new bore during the years covered. Neither disputed the Department's extraction records.

132 Both applicants also took the opportunity of responding in more detail to the ASGE program and policy of historical extraction, about which they were obviously dissatisfied.

133 On 29 January 2006 the Harvey applicants wrote to the Murrumbidgee Catchment Management Authority objecting to the ASGE policy of using history of extraction as it was biased against their area due to its late development compared to other areas. This letter stressed that the 52% entitlement originally adopted was crucial to their long-term viability. The Harvey applicants sent a similar letter to the NSW Irrigators' Council. The NSW Irrigators' Council responded to the Harvey applicants on 4 February 2006 to the effect that the Council supported the history of extraction policy. The response noted that: On the issue of anomalies, late developers and other entitlement holders with specific development issues may be able to present details of their individual circumstances to an anomalies committee for consideration.

At this stage, finalisation of the anomalies process has not been completed, so issues such as: what issues will be regarded as an anomaly; how will anomalies be assessed and when will assessment of anomalies be undertaken have not yet been determined.

All entitlement holders will be advised of the processes to be followed and be given sufficient opportunity to submit claims for consideration.

…I regret that at this time, I cannot advise whether it will be possible for the issues you raised to be treated as anomalies.

134 On 30 January 2006 the Harvey applicants forwarded an email to the attention of the Minister protesting the unfairness of the history of extraction policy and urging a return to the across-the-board cuts policy. The Department responded in late February 2006 to the effect that there would be no return to the across-the-board cuts policy as the NSW and Commonwealth governments had agreed on the ASGE program, the key principles of which included recognising water-dependent investment. This response noted that the Murrumbidgee Catchment Management Authority was available for further consultation and encouraged the Harvey applicants to work with the Authority to formulate an acceptable weighting based reduction of groundwater (this being a reference to the potential for the weighting between active and inactive groundwater to affect the determination of share components based on the history of extraction policy).

135 In the interim, between November 2005 and January 2006 the Murrumbidgee Catchment Management Authority held nine consultation meetings at various locations within the area affected by the plan about the ASGE program. 136 On 27 February 2006 the Tubbo applicants sent a letter to the Department, the Minister, State and Federal members and the Hon Malcolm Turnbull MP, then Parliamentary Secretary to the Prime Minister and responsible for the Commonwealth's role in the ASGE program. The letter and attachments described the Tubbo applicants' acquisitions, developments, and circumstances, and the inadequacy of available adequate financial compensation if its access to groundwater were reduced by reference to history of extraction. On 9 March 2006 the Tubbo applicants' State member wrote to the Minister about the dire consequences of the history of extraction policy attaching a copy of the 27 February 2006 correspondence.

137 On 28 February 2006 the GAAC met. It identified the members of the proposed regional groundwater verification committees for each of the six regions (the Chair of the local catchment management authority or delegate, the Department's Regional Director or delegate, and the Chief Executive of the NSW Irrigators' Council). Another Departmental officer, Mr Verhoeven (Manager Groundwater Adjustment and Assistance) was to attend all meetings of the regional groundwater verification committees to provide advice on consistency across the six regions. The GAAC also endorsed the terms of reference of the regional groundwater verification committees, including the confidentiality of the deliberations of each committee and that applications would be processed consistent with the committees' agreed processes.

138 Another item on the GAAC's agenda on 28 February 2006 was "anomalies, exemptions". The GAAC requested that the Department urgently produce a paper addressing late developers and anomalies as the GAAC recognised using a history of extraction approach would mean that some licence holders would not have access to the water they thought. The GAAC required the paper to include: - (i) critical dates of decisions and government announcements after the gazettal of the original water sharing plans, (ii) what constituted an anomaly, (iii) an idea of the quantum of anomalies in the six regions, and (iv) legal advice on the way forward. The GAAC noted that this work on anomalies was confidential and that the GAAC "is aware of anomalies, and that they are being considered by DNR". Finally, the GAAC noted that a decision on how to address anomalies was required in mid to late March before the regional groundwater verification committees commenced operation.

139 The NSW Irrigators' Council forwarded another letter to all entitlement holders on 5 March 2006 about the ASGE program. This letter identified the members of the GAAC and its function to manage the program and advise and make recommendations to the NSW and Commonwealth governments. It noted the proposed consultation process involving the catchment management authorities but that the authorities could not change the objectives of the program or override the history of use policy position. The letter also identified an anomalies process saying that, in addition to contested pumping records, other anomalies had been identified and needed to be considered including properties purchased on the basis of the policy of across-the-board cuts severely disadvantaged by the change to history of use, inequities in revocation of entitlements and late developers. The letter said that individuals would be invited to submit details of issues they believed should be considered by the "Anomalies Committee" to their catchment management authority representatives. The letter also identified matters the Department would not treat as anomalies (bore failures, lack of available drillers and other development resources, drought, lack of funds, power failures, and other performance related issues), but that there may be other issues presented for consideration. Membership of the "Anomalies Committee" was identified as being a representative from the Department, the National Water Commission, the catchment management authority, and the NSW Irrigators' Council. The Tubbo applicants received this letter. I infer that the Harvey applicants also received this letter given their status as licence holders and the nature of the document as general information about the program.

140 On 6 March 2006 the Murrumbidgee Catchment Management Authority issued a media release saying that the Murrumbidgee Regional Groundwater Verification Committee (MRGVC) had been established to review estimates of licence holders' history of extraction where the holder disagreed with the Department's estimate and that the MRGVC would give advice to the Director-General of the Department on this issue consistent with the outcomes of the groundwater assistance package.

141 On 10 March 2006 the Department forwarded to each licence holder a table of estimates of different weighted scenarios of active to inactive water and the impact on entitlements to assist in consultation with the catchment management authority.

142 The GAAC held another meeting on 17 March 2006 to consider late developing licence holders and anomalies. The meeting paper included the information requested by the GAAC from the Department. The paper dealt with late developers and anomalies. Late developers were identified as within two categories (those who increased their water dependent investment during the history of extraction period and those who invested after the water sharing plans were gazetted). For the Murrumbidgee region the paper said the "cut-off date" for the first category after which time the Department considered people should not make "unreasonable speculative investment" was 1 June 2002 (when information about the intention to reduce entitlements, current entitlements, and sustainable yield were all available and the draft water sharing plan had been exhibited). The paper said the second category "may have a case which would need to be considered inside an anomalies process". The paper dealt with this issue saying that the position of those who invested after the gazettal of the water sharing plans were not addressed by either the late developer or verification approaches. Given the date of gazettal of the plans (December 2002 to February 2003) and the media release on 30 June 2004 saying the NSW Government was considering acknowledgment of historical use, the paper said there could be anomalies within this period where "individual circumstance of each licence holders' case being presented as an anomaly needs to be carefully considered". The paper noted that people may have invested or developed up to the level of anticipated reductions in the gazetted plans but, with the change in government policy, their entitlements may be reduced, thus losing their investments/developments. The paper said that many submissions had been received "outside the verification process" (which I take to be a reference to the invitation to make submissions about any error in the Department's extraction records in late December 2005). These included late developers, anomalies, people who developed after June 2004 and probably did not have a case as an anomaly, and people who disagreed with government policy. A table showed the total number of submissions received "outside the verification process" for each region and the likely number of anomalies who had "developed water investment" between December 2002 and June 2004. For the Murrumbidgee region, the total number was 24 and the likely number of anomalies was 6. The total for all regions was 90 with a likely number of 44 anomalies.

143 The paper recommended that the regional groundwater verification committees review all of the submissions referred to in the table (that is, the submissions already made in response to the invitation to dispute the Department's extraction records) and make recommendations to the Director-General of the Department about licence holders who had "developed water investment between December 2002 and June 2004". The paper suggested that guidelines for the committees could include: - (i) evidence of development and expenditure that increases dependence on water, (ii) quantification of the additional water up to the level of across-the-board cuts, (iii) no recognitions of development that increases the level of water required greater than that under the gazetted water sharing plan, and (iv) history of extraction to June 2004. Although the increase in water volume was not expected to be large as a result of this process, the paper said the regional groundwater verification committees should use a flexible approach and suggested a number of options (for example, take the volume off the sustainable yield and then distribute the reduced yield to others, add the volume to each relevant person's history of extraction, additional financial assistance, or by supplementary water licences).

144 Under the heading "legal advice", the paper noted that the small number of licence holders recommended to have their share of sustainable yield increased to across-the-board cuts should have their licences listed in each water sharing plan, with the schedule clearly articulating the method used to increase the history of extraction of the impacted licences.

145 I infer from later events (namely, the GAAC meeting on 6 April 2006) that the GAAC did not adopt the recommendations in the paper on 17 March 2006.

146 The Department responded to the Harvey applicants' submission on history of extraction on 18 March 2006 to the effect that there was no discrepancy. The letter said that if they were still dissatisfied they could elect to have information put before the MRGVC, but that the MRGVC would be dealing only with "extraction figures" not "drilling problems" as referred to by the Harvey applicants, but they would be notified if any process to deal with that issue became available. The Harvey applicants elected to have their issues dealt with by the MRGVC. The election form referred to an election to have "my information put before the Regional Groundwater Verification Committee".

147 On 23 March 2006 the Tubbo applicants wrote to the chair of the Murrumbidgee Catchment Management Authority about an "anomalies case" saying that although they had not been contacted by any parties involved in reviewing the impacts of the ASGE program they had become aware of the establishment of a body to consider anomalies (presumably because of the communication from the NSW Irrigators' Council). The letter attached a copy of the correspondence of 27 February 2006 and set out a series of circumstances said to make the Tubbo applicants' position anomalous. These circumstances dealt with the acquisition of properties in 1998 and subsequent capital investment during which groundwater entitlements could not be fully used. The letter identified various development projects (but not the dates of their commencement and completion) and said they had been carried out based on the original groundwater entitlements of about 20,000ML per year. The Murrumbidgee Catchment Management Authority subsequently forwarded a copy of this letter to the Department for submission to the regional groundwater verification committee.

148 Throughout March 2006 the Murrumbidgee Catchment Management Authority held another four public consultation meetings (in addition to the nine meetings referred to earlier) describing the proposed ballot for weighting of active to inactive water and the ASGE program. The Harvey applicants apparently attended at least one (and possibly more than one) of these meetings and were certainly aware they had been held.

149 In early April 2006 the Australian Electoral Commission conducted the ballot with respect to the weighting of active to inactive groundwater for the Murrumbidgee region. The results were declared on 27 April 2006.

150 The GAAC met on 6 April 2006. Agenda item 3.4 (late developing licence holders and anomalies) dealt with the 17 March 2006 paper. The outcomes (which I infer to be the GAAC's decision) are identified as: -(i) the GAAC deciding to replace "anomalies" with special circumstances, (ii) a request to the Department to clarify the process to be followed by the regional groundwater verification committees, (iii) a request to the Department to quantify the magnitude of the problem with late developer licence holders based on the submissions received, (iv) a recommendation from GAAC to Ministers that any bona fide special circumstances be addressed through financial assistance and not with water from other licence holders, with the Department to analyse the scale of the problem and the amount of financial assistance required. Otherwise the GAAC agreed that regional groundwater verification committees should meet in April and May to review all submissions as requested by licence holders and make recommendations to the Director-General of the Department via the GAAC. The GAOC also met on 6 April 2006 for the purpose of considering and endorsing the GAAC's decisions between 1 December 2005 and 28 February 2006.

151 On 13 April 2006 Mr Verhoeven of the Department circulated an email to the members of the GAAC attaching a paper clarifying the processes to be followed by the six regional groundwater verification committees as requested by the GAAC at its meeting on 6 April 2006. The paper dealt with the process to be used by those committees to determine history of extraction, late developers and special circumstances. The proposed process involved a review of the submissions already made by licence holders and an initial decision by the Department to be notified to the holder, with a capacity for an appeal for review to be put to the regional groundwater verification committee. The appeal/review process would involve the Department in summarising the issues and making a recommendation to the committee in a short report using certain criteria. For late developers and special circumstances, the relevant criteria were set out in attachment D. The committees would then review the matter based on the licence holder's submission and the Department's report against the same attachment D criteria. The committee could request additional information from the licence holder or the Department if required. However, committee members were not to contact licence holders personally with all communications to be through the Department and the Department providing the committees with the information submitted in writing by licence holders. The committees' recommendations would be presented to the GAAC. The GAAC would review the recommendations and make its own recommendations to the Director-General of the Department. The MRGVC would involve Mr O'Brien, the Chair of the Murrumbidgee Catchment Management Authority, Mr Miell, the Chief Executive of the NSW Irrigators' Council and Mr Painting, the Regional Director of the Department.

152 Attachment D to the email of 13 April 2006 (dealing with the criteria for determining special circumstances) generally reflects the paper presented to the GAAC on 17 March 2006 other than that it refers to the GAAC's decision that bona fide special circumstances be dealt with by way of financial assistance and not by taking water from other licence holders. Hence, attachment D includes the timeline of critical dates and table referred to above and sets out the same description of special circumstances being possible between December 2002/Febrary 2003 (when the water sharing plans were gazetted) and June 2004 (when the media release referred to the government acknowledging history of extraction). The attachment said that within this period each individual licence holder's case represented as special circumstances was to be carefully considered. They might have invested or developed up the level of the reductions anticipated within the water sharing plans as gazetted, which could include purchase of properties and investment in water related infrastructure and may lose that investment or development if their entitlements are reduced further than anticipated.

153 I infer that the GAAC approved of the processes for regional groundwater verification committees as recommended by Mr Verhoeven in his email of 13 April 2006 some time before the MRGVC met on 10 May 2006.

154 The Department (Mr Painting) responded to the Tubbo applicants' submission about an alternative policy to history of extraction on 13 April 2006.

155 On 20 April 2006 a representative of the Murrumbidgee Catchment Management Authority visited the Harvey applicants and told them that they would not get much water under the history of extraction formula but that there was an anomalies process and they had a very strong case. When the Harvey applicants asked what they should do the representative advised them to put a short simple letter in explaining their case for special consideration immediately and to note that further information could be provided. The Harvey applicants submitted a letter to the Murrumbidgee Catchment Management Authority and the Department (Mr Lawson) on the same day. Their letter said that they appreciated the provision of "an anomalies dimension to allow for a fair and balanced approach to… those adversely affected by" the HOE policy. They briefly identified their business plan over the last five years and their trouble with failed bores all of which had been underpinned by the available water. The letter said: Investment figures and costings for our business can be supplied if required to reinforce just how much we have invested. Any less than this 52% allocation threatens our viability and future. It should be noted that the above investment was formulated and developed based on our original 6600 megalitre allocation . Therefore, could you please consider our circumstances as a genuine anomaly.

156 On 27 April 2006 Mr Verhoeven of the Department prepared a submission to the Minister proposing a response to the Tubbo applicants' letter of 27 February 2006. The submission noted that the Department was reviewing the submissions from licence holders and would be considered by the regional groundwater verification committees in April and May which would then make recommendations based on "eligible special circumstances". Mr Verhoeven noted that the Tubbo applicants might have a case for special circumstances to increase its entitlement. The recommended letter was not sent at this time.

157 The Tubbo applicants forwarded a further letter to the Minister on 28 April 2006 enclosing another draft of their alternative proposal for achieving sustainable use of groundwater in the Lower Murrumbidgee.

158 The MRGVC met on 10 May 2006 to consider the 50 licence holders who were disputing their history of extraction or claiming special circumstances. The attendees were Mr O'Brien, Mr Miell, Mr Painting, as well as Mr Verhoeven, the Departmental representative available to ensure consistency between regional groundwater verification committees. I infer that, consistent with the agreed process, the Department presented the MRGVC with a list of issues to be determined on the basis of submissions received. A table dated 9 May 2006 indicates that the Department had classified the submissions into various categories, being "HOE verification", "special circumstances", "new owner", "permanent planting", "year of bore construction", "property amalgamation", "supply to neighbour" and "former conj." The last abbreviation remained unexplained during the proceedings. There is an obvious potential for overlap between the categories that suggests they were preliminary and indicative only. For example, Mr Verhoeven considered the Tubbo applicants may have a case for special circumstances but the categories against their licences are "permanent plantings" and "property amalgamation".

159 I infer that the Department presented the MRGVC with a draft recommendation about each licence holder who made a submission in the report format recommended by Mr Verhoeven on 13 April 2006. The MRGVC considered the submissions and the Departmental reports, and adopted or amended those reports at and after the meeting by email communications. In consequence the reports for the Tubbo and Harvey applicants were modified on a number of occasions.

160 Mr Painting, the Department's Regional Director and a member of the MRGVC, said that licence holders who wished to make a submission for "special circumstances" were asked to make a submission to "show cause" or "put their case". This is consistent with the report of the Murrumbidgee Catchment Management Authority to the Department of 25 May 2006 recording that late developers had been encouraged to register as an anomaly or to request that their special circumstances be considered by the MRGVC.

161 Mr Painting said that, at the meeting on 10 May 2006, each member had a folder with the draft reports and associated documents (I infer, the submissions from the licence holders). Each application for special circumstances was dealt with "individually and considered on its merits". Generally, the MRGVC determined special circumstances by reference to proof of reliance on across-the-board cuts between early 2003 and mid 2004. Mr Painting described this as the "main criteria". Where submissions clearly met the criteria, the MRGVC approved special circumstances. Others with little or no supporting information were declined. If the licence holder had made a "solid attempt" to show such reliance, with minor gaps, more information was sought. Where special circumstances were approved, Mr Painting said the MRGVC recommended an increase in the licence holder's final net entitlement (or FNE) to the level of the across-the-board cuts.

162 On 15 May 2006 Mr Verhoeven emailed the draft reports to the MRGVC members requesting their feedback. The email noted that two licence holders (one of which was the Tubbo applicants) might need further consideration as they had developed their permanent plantings throughout the "special circumstances period". The draft reports identified four special circumstances cases. The reports for the Tubbo applicants recommended no exemption for permanent plantings but asked whether there might be a case to see how much the Tubbo applicants invested before June 2004 given the across-the-board cuts. The reports for the Harvey applicants simply stated that the licence holder had "not identified the issue(s) he is disputing".

163 On the same day, 15 May 2006, Mr O'Brien responded to Mr Verhoeven's email indicating that he was nervous about comparing final net entitlements with across-the-board cuts. Mr O'Brien saw this as relevant to those who had made out special circumstances but not to others as it might be legally irrelevant. Mr Miell also responded on the same day by marking up comments on the draft reports. His comment for the Harvey applicants was "agreed". For the Tubbo applicants Mr Miell said that there were no outstanding issues for the second dot point (which left a question mark in the description of the dates of investment) and "agree that there be no exemption". Mr Lawson, another officer of the Department requested to comment on specific issues in the draft reports by Mr Verhoeven, responded on 16 May 2006. With regard to the permanent plantings cases (one such case being the Tubbo applicants) Mr Lawson noted that he did not "read any claim of assuming 52% of entitlements in their submissions". Mr Lawson said that he would "be reluctant to raise this with them unless we raised it for all users".

164 On 17 May 2006 the Minister responded to the correspondence from the Tubbo applicants enclosing their alternative proposals for sustainable use of groundwater on 28 April 2006. The Minister's response referred to the consultation process being run by the Murrumbidgee Catchment Management Authority as "critical in ensuring that all stakeholder views are heard and considered on this important matter". The letter continued as follows: All licence holders have been requested to confirm their History of Extraction (HOE) with the Department of Natural Resources. I am advised that licence holders such as yourself, have used this opportunity to present their case as a "late developer" or to highlight special circumstances. These submissions will be reviewed by Regional Groundwater Verification Committees during May who will recommend HOE and additional entitlement and/or financial assistance as a result of eligible special circumstances.

I can assure you that your submission will be taken into account in making the final decision. 165 The Minister responded to the State member on the same day in terms that also referred to the consultation process. The State member forwarded a copy of this response to the Tubbo applicants a few weeks later (on 27 May 2006).

166 On 19 May 2006 the National Livestock and Properties Manager for Coles Supermarkets wrote to the Minister on behalf of the Harvey applicants. The letter explained Coles' long standing supply arrangements with the Harvey applicants. A person, presumably a Ministerial staff member, contacted the author of this letter to understand its purpose and was informed that Adrian Harvey had requested a letter to the Minister in support of his submissions about groundwater entitlements.

167 On 24 May 2006 the Murrumbidgee Catchment Management Authority wrote to the Department setting out the details of its community consultation including public meetings and the ballot. The Authority recommended, amongst other things: 2. That late developer entitlement holders who demonstrate to the Verifications Committee that they had developed their irrigation business based on a proven expectation that the Murrumbidgee Groundwater Water Sharing Plan would be implemented with across the board cuts have their Final New Entitlement adjusted accordingly. 168 The GAAC met on 25 May 2006 and agreed to endorse the report and recommendations of the Murrumbidgee Catchment Management Authority for submission to the GAOC and recommendation to the Minister. The GAAC also noted all of the licence holders within the special circumstances category, involving 26 property holders across the six regions (with four in Murrumbidgee) and total additional water of 6437ML, involving a saving in terms of financial assistance of $1,599,055. Given the low volume of water, the GAAC thus decided to alter its position that financial assistance be used to satisfy special circumstances and to do so instead from valley or zone sustainable yield, with the saved money to be used for local benefits within the area. Further, that for licence holders with special circumstances "on balance" between their determination under the recommended approach (based on history of extraction) and the special circumstances outcome (based on across-the-board cuts), contact be made to request the licence holder's preference.

169 The GAOC met on 8 June 2006 and endorsed the GAAC recommendations of 25 May 2006.

170 On 13 June 2006 Mr Painting sent an email to Mr Miell, Mr Verhoeven, Mr O'Brien, Mr Lawson and one other person. This email said that he was "OK with Turner" (a reference to one licence holder who was requested to provide information about special circumstances and did so) and was "generally OK with Hancock" (another licence holder). Mr Painter then noted that: I recognise that they had evidence of advice from DNR but I'm concerned that others might be in a similar situation and haven't been recognised. 171 In mid June 2006 Mr Verhoeven prepared a briefing paper to the Minister recommending that he write to the Parliamentary Secretary to the Prime Minister seeking approval for the outcomes of the consultation process and the recommendations of the regional groundwater verification committees. The applicants contended that the Minister never approved this briefing paper and thus never endorsed the outcomes of the deliberations by the MRGVC. However, the contrary is demonstrated by the fact that the Minister sent the letter recommended in this briefing paper on 15 June 2006. The Minister's letter noted the following: Regional groundwater verification committees When the 1405 licence holders were sent their information packs in December 2006, they were requested to confirm their history of extraction (HOE) with the department. Of the responses, around 355 disagreed, with many using this as an opportunity to present their case as a late developer or to highlight special circumstances.

These submissions were examined by the department which sent a determination to licence holders. 103 licence holders agreed with the determinations, 64 are still to reply, and the remaining 187 were sent on to six regional groundwater verification committees for their independent review and recommendation. Their recommendations to amend water entitlement and financial assistance for eligible licence holders have been reviewed by the GAAC and the GAOC. The GAOC agreed to recommend the changes to HOE and special circumstances at Attachment B to NSW and Australian Government Ministers for approval.

The water required for changes to HOE and special circumstances will be obtained by adjusting the final share of sustainable yield and financial assistance of all licence holders within each valley and zone in which the property accounts are located.

The regional groundwater verification committees will review outstanding submissions (including the 64 licence holders still to reply) if they are returned during June 2006.

All licence holders who had submissions examined by the regional groundwater verification committees will be advised in writing following Ministerial approval. 172 On 20 June 2006 Mr Verhoeven sent an email to the MRGVC members (and Mr Lawson) attaching the reports for the 35 properties examined by the MRGVC incorporating the comments and suggestions of the members. The reports for the Harvey applicants remained in terms that they had not identified the issues in dispute. The reports for the Tubbo applicants were abbreviated but included that their investment decisions in 2003 and 2004 should have been guided by the across-the-board cuts of 51.4% as contained in the original plan. Mr O'Brien responded on 25 June 2006 to the effect that he had a "heightened level of nervousness" about such comments as they might be understood as saying that a policy of across-the-board cuts should have been relied on in 2003 and 2004 and thus "should be the model to use now" when the MRGVC was "not saying this".

173 On 4 July 2006 the Tubbo applicants wrote to the Minister noting that the Minister's response to the State member on 17 May 2006 did not address their issues of concern. The letter set out the impacts of the history of extraction policy on the Tubbo applicants. A copy of this letter was forwarded (by the Leader, Ministerial Correspondence Coordination) to Mr Verhoeven for comment.

174 On 10 July 2006 Mr Verhoeven sent an email to the GAAC members seeking comments on urgent recommendations to the GAOC and NSW and Commonwealth Ministers. The attached papers set out details of additional changes of certain histories of extraction and additional special circumstances cases (totalling 11 in number and involving an extra 708ML of water entitlements). None of the additional special circumstances cases involved the Murrumbidgee area. The GAAC endorsed these recommendations. The recommendations were submitted to a meeting of the GAOC on 12 July 2006 for consideration. The GAOC agreed to submit the recommendations to the Ministers. The applicants contended that there was no evidence of this having been done. Subsequent events, however, demonstrate to the contrary, including the further letter from the Minister to the Parliamentary Secretary to the Prime Minister seeking approval of the regional groundwater verification committees' second round of consideration mentioned below.

175 On 24 July 2006 Mr Verhoeven responded to the request for information about the letter from the Tubbo applicants on 4 July 2006. The response identified the consideration of the matter by the MRGVC which had recommended no exemption. Further, that nobody could be advised of the outcomes recommended as Ministerial approval had not yet been granted. The Leader, Ministerial Correspondence Coordination, Mr Verhoeven and others (including the Director-General) then prepared a briefing note to the Minister recommending that a letter in reply be sent in a standard format. This letter was not sent until 24 September 2006 (see below).

176 Through July and early August 2006 officers of the Department approved Mr Verhoeven's briefing paper to the Minister (prepared 13 July 2006)). The briefing paper recommended that a further letter be forwarded to the Parliamentary Secretary to the Prime Minister seeking approval of the regional groundwater verification committees' second round of consideration. The recommended letter was sent on 3 August seeking approval of the outcomes of the second round of reviews of the outstanding submissions received by the regional groundwater verification committees. The Parliamentary Secretary to the Prime Minister responded on 14 August 2006 to the effect that certain further information was required. In so requesting the Parliamentary Secretary to the Prime Minister noted that the "verification committee process sought to assist those who had made investment decisions relying upon the then policy of adjustment based on across the board cuts".

177 On 16 August 2006 the Department notified licence holders of their new entitlements and that the draft amendments to the original plan would be exhibited for public comment shortly, the amended plan being scheduled to commence on 1 October 2006. The letter noted that: Regional groundwater verification committees have now reviewed submissions, including those on the history of extraction, late developers, and special circumstances. If you made a submission to the committee, a response will be provided in a separate letter.

178 On 23 August 2006 the Minister approved a briefing note prepared by Mr Verhoeven on 14 August 2006 (and approved thereafter by other officers of the Department). This briefing note recommended that the Minister approve public exhibition of the draft amendments. The briefing paper noted that all six plans were scheduled to commence on 1 October 2006 and that, to meet this deadline, exhibition needed to start on 18 August 2006 and end on 1 September 2006. The documents for exhibition included an information sheet, the draft amendments with a brief explanation for them, a submission form for submissions, and a draft media release. The draft amendments included Sch 5 identifying an aquifer access licence share component for four licences, being those licences the subject of a positive recommendation for special circumstances by the MRGVC to the GAAC (and thence to the GAOC and Minister). The reason for the change under Sch 5 is identified as: Provide for across the board cuts where Special Circumstances have been demonstrated by entitlement holders.

179 A media release from the Department on 25 August 2006 confirmed the public exhibition of the draft amendments and supporting material approved by the Minister between 25 August and 8 September 2006. The applicants pointed out that this was less than the period of 40 days provided for in s 38(2)(b) but, of course, the Minister was not bound by that section when making the amendment order.

180 The Tubbo applicants emailed Mr Lawson on 29 August 2006 noting that it had received no response to its earlier submissions and asking whether further submissions should be made. Mr Lawson confirmed receipt of the earlier submissions and recommended that the Tubbo applicants make a further submission to the draft amendments.

181 The Harvey applicants made a submission to Mr Lawson on 4 September 2006. This letter enclosed financial information establishing their water dependent investment before and after 2003. The letter said that the Harvey applicants were disappointed that the MRGVC had not requested this information or informed them as to how their water dependent investment was different from others. The Harvey applicants requested reconsideration of their application as several others in similar circumstances appeared to have had their cases dealt with in a seemingly equitable manner. The letter explained that they had invested heavily based on their original entitlement and then continued to invest on the basis of an assumed entitlement of 52% as set out in the plan gazetted in 2003.

182 The Tubbo applicants made a submission to Mr Lawson about the draft amendments on 5 September 2006. The letter reiterated that they had bought the properties before the policy of reduction was announced and had spent some $30 million on the basis of the underlying groundwater entitlements so that, at worst, they should be treated as having an allocation of that amount (20,742 ML).

183 On 18 September 2006 the Minister signed a briefing paper recommending that he approve the draft amendments and seek the concurrence of the Minister for the Environment. The Minister wrote to the Minister for the Environment on the same day seeking concurrence. The attachments to the briefing paper and the letter seeking concurrence included a review of the 41 submissions received in response to the public exhibition. The review noted that submissions had been received to the effect that the draft plan (as amended by the proposed amendment order) was unfair to individuals, failed to consider individual circumstances, penalised late developers and the like. The Minister for the Environment granted concurrence on 20 September 2006 noting that no structural adjustment funding should be paid while there was the potential for legal challenge to the plans.

184 On 21 September 2006 officers of the Department recommended to the Executive Director that he approve a letter to licence holders informing them of the outcome of their "appeals or submissions" to the regional groundwater verification committees. This note to the Executive Director said the regional groundwater verification committees (all six) had considered 248 applications and submissions in total, with 108 "receiving a favourable decision". An amended version of this letter was not sent until 18 October 2006 after the making of the amendment order, as the Minister's approval of the correspondence was also sought (see below).

185 On 24 September 2006 the Minister approved a briefing paper recommending the making of the amendment order. The paper recommended the Minister do so on the basis of his satisfaction that it was in the public interest.

186 On the same day, 24 September 2006, the Minister approved a response to the letter from the Tubbo applicants of 4 July 2006. The Minister's response referred to the extensive consultation process undertaken by the Murrumbidgee Catchment Management Authority as follows: As you know, an extensive consultation process was undertaken by the Murrumbidgee Catchment Management Authority to allow for all stakeholders to comment on the appropriate process for distribution of entitlement and finances to their particular valley. Licence holders were requested to confirm their HOE with the Department of Natural Resources. Many used this as an opportunity to present their case as a late developer or to highlight anomalies. I note that your company took advantage of this opportunity.

These submissions have been processed by the Department, and assessed by the Regional Groundwater Verification Committees. The committee's recommendations have been reviewed by the Groundwater Adjustment Advisory Committee and I am, along with the Parliamentary Secretary to the Prime Minister, the Hon Malcolm Turnbull, currently considering their reports.

As you may be aware, the water sharing plans for the six inland groundwater sources will commence on 1 October 2006, including that for the Lower Murrumbidgee groundwater source.

187 Also on 24 September 2006, the Harvey applicants wrote to the Department about the dismissal of their appeal for special consideration to the MRGVC (presumably based on their knowledge that they were not referred to in Sch 5 to the plan as amended). This letter and attachments explained their investment before and after 2003, with the latter dependent on the policy of across-the-board cuts to 52% contained in the original plan gazetted February 2003. The letter required an explanation "as to why our appeal to the verification committee was rejected and the criteria used to differentiate our case from the others".

188 The Lieutenant-Governor made proclamations on 1 October 2006 by which Pts 2 and 3 of Ch 3 of the Act applied to the water source the subject of the Water Sharing Plan for the Lower Murrumbidgee Groundwater Sources 2003. On 29 September 2006 the amendment order was published in the Gazette. Clause 2 of the amendment order provided for commencement of the plan (as amended) on 1 October 2006. The amended plan included cl 25C and Sch 5. As noted, Sch 5 identifies a share component for four licence holders on the basis of the 52% across-the-board cuts policy, as recommended by the MRGVC (and then the GAAC and the GAOC) to the Minister.

189 On 11 October 2006 the Minister approved the recommended letters to the licence holders (with some amendment) advising them of the outcomes of their appeals and submissions to the regional groundwater verification committees.

190 The solicitor for the Harvey applicants wrote to the Department on 13 October 2006 noting that their client had not had a reply from the MRGVC despite the reduction of their water allocation from 7045ML to 1309ML, which would mean "disaster" for their client as the Department should see from the information provided about the Harvey applicants' investments. The letter requested information about any avenues for appeal. The Department responded on 30 November 2006 to the effect that there was no formal appeals process.

191 On 18 October 2006 the Department wrote to the Tubbo applicants advising them that their submission for a variation to their history of extraction had been considered by the MRGVC but their "case for Special Circumstances has been unsuccessful" as "the ASGE Program does not make exceptions for permanent plantings". The Tubbo applicants were informed that this decision was final and no further submissions would be considered. The Harvey applicants were sent a similar letter on the same day advising them that there was to be no amendment to their history of extraction as they had "not provided sufficient information to clarify and substantiate your claim". On 23 October 2006 the Tubbo applicants received another letter from the Department about their submissions based on property amalgamations and policy. They were informed that the issue of property amalgamations was covered by the rules for determining history of extraction and the policy issues were not a matter for the committee. Further, that the decision was final and no further submissions would be considered.

192 The Harvey applicants wrote to the Minister on 6 December 2006 expressing their concern that the history of extraction policy was meant to protect water dependent investment, but their own investment would be decimated by their water allocation. Amongst other things, this letter noted that they were having difficulty getting an answer from the MRGVC as to why their case as an anomaly was dismissed compared to the four cases that succeeded noting, in particular, that they had offered but not been requested to provide additional information when one of the successful applicants had been given the opportunity to supplement their submission. An undated briefing paper was submitted to the Minister about this letter observing that: The Murrumbidgee Groundwater Verification Committee considered applications from licensees for variations to their HOE and for special circumstances consideration. The Harvey's submitted a case to the Verification Committee in April 2006. They did not identify any specific basis for a variation to their History of Extraction…, nor did they provide an argument for special consideration. The verification committee noted that "the licence holder has not identified the issue(s) he is disputing" and determined that there would be no change to HOE and were unable to consider any special circumstances….

The Water Sharing Plan for the Lower Murrumbidgee Groundwater Sources commenced on 1 October 2006. The entire sustainable yield was allocated to entitlement holders.

On 15 October 2006, the Harvey's provided details of costs for a replacement bore to the Department (Tab A). It was then too late to further consider their circumstances as the WSP had commenced and the entire sustainable yield had been distributed to entitlement holders.

In the letter of 15 October, the Harvey's also provided details to the Department of poor bore construction which had restricted their extraction. While the rules for determining HOE were provided to Mr Harvey in December 2005, which provide for the exclusion of one year from the averaging period when determining the HOE, the Harvey's did not provide information on this issue for the verification committee to consider when reviewing their HOE.

193 On 2 March 2007 the Director-General of the Department forwarded a letter to the Harvey applicants in accordance with the recommendation in the briefing paper to the Minister. Amongst other things, the letter: - (i) noted the consultation carried out by the Murrumbidgee Catchment Management Authority, (ii) said the Harvey applicants' submission to the MRGVC did not identify any basis for a variation to their HOE or provide an argument for special circumstances consideration, (iii) informed them that the water sharing plan commenced on 1 October 2006 and allocated the entire sustainable yield, and (iv) said their letter about bore problems had been received too late as the entire sustainable yield had already been distributed. The Harvey applicants responded on 19 March 2007 noting, amongst other things, that their second bore was installed during the "magical period" and that they had sent the same information to Mr Lawson on 4 September 2006 as provided on 15 October 2006 only for their submission to be ignored.

194 Adrian Harvey and John Crase (a director of the Tubbo applicants) both provided affidavits. Neither was cross-examined.

195 In his two affidavits, Mr Harvey said that: - (i) he became aware of the policy of reducing water entitlements by 48% in about February 2003, (ii) from then on all his investment decisions were based on a worst case allocation of 3624ML (or 52% of 7045ML), (iii) he became aware of a proposed change to a history of extraction policy in about December 2005, and (iv) he did not attach details of his investments dependent on access to 52% of his original allocation to his application to the MRGVC on 20 April 2006 because he did not know that the criteria being applied by the MRGVC to consider special circumstances was investment on an assumption by the licence holder of cuts to 52% to entitlements, and because of the conversation with the representative of the Murrumbidgee Catchment Management Authority just before he submitted his application advising them to keep it short and simple and make the point that further information could be provided if required. Mr Harvey's affidavits also included detailed information about his substantial investments on the assumption of access to 52% of the original water entitlement in the period between 1 February 2003 and 30 June 2005, as well as the devastating effect on the Harvey applicants' business of their reduced allocation (from 7045ML per year to 1309ML per year).

196 In his affidavit Mr Crase said that: - (i) the Tubbo applicants were never informed that the criteria for obtaining special consideration included a licence holder demonstrating that its investment decisions in 2003 and 2004 were guided by the gazetted water sharing plan which provided for across-the-board cuts to 51.4%, (ii) during 2003 to mid 2004, although he hoped for a much better outcome, his absolute worst case expectation was that the Tubbo applicants would receive 51.4% of their original entitlements, and (iii) the Tubbo applicants never saw the various versions of the reports to and of the MRGVC about their application. Mr Crase's affidavit also provided details of the Tubbo applicants' substantial investments in developing their properties, including in the period between February 2003 and June 2004 and the devastating effect on the Tubbo applicants' business of their reduced allocation. Further, that had the Tubbo applicants been offered the alternative of an allocation consistent with the across-the-board cuts, they would have elected to receive the 51.4% allocation, but were not given an opportunity to say so.

197 The applicants' case started with the proposition that the applicants had not been included in Sch 5 when other individuals had been, and worked backwards to examine the process that led to that outcome. This process was characterised as involving a decision about individual circumstances, thus attracting the duty of procedural fairness. This approach, as the respondent's submissions identified, tends towards circularity. It assumes the result (the duty applied) by the circumstance (or alleged circumstance) of unfairness in the process leading to the inclusion of Sch 5 in the amendment order. As the respondent submitted, there is a fundamental anterior question arising from the basic proposition of Parliamentary supremacy. Whatever form Sch 5 ultimately took or the process by which it was reached, the question whether the duty applies (and, if it applies, its content) is largely one of statutory construction and thus requires close consideration of the particular power said to be conditioned on the observance of procedural fairness (Kioa v West at 584 and SZBEL at [26]).

198 In further submissions, the applicants observed that it was no answer to point to the various authorities identifying the question whether the duty applies as largely one of statutory construction; the proper construction of the statute may well be that Parliament intended the statutory power to be subject to the duty if exercised in one manner and not subject to the duty if exercised in another. The applicants claimed that the single exercise of the power in this case (to make the amendment order) attracted a duty of procedural fairness insofar as the amendment order included Sch 5 (given effect by cl 25C(4)) but did not attract the duty insofar as the amendment order otherwise affected licence holders by general and indiscriminate rules (presumably, amongst other provisions, cl 25C(5)). They submitted that the power in s 45(1)(a) was thus "apt to affect the interests of individuals" and the Minister would be at least entitled, if not bound, to consider individual interests, both circumstances indicating application of the duty (Kioa v West at 619).

199 The applicants relied on the many authorities indicating the flexible or "chameleon like" qualities of procedural fairness in support of these submissions. In my view, however, these references concern the content of the duty rather than its application. Moreover, if the duty is as flexible as the applicants' submissions propose then it is difficult to understand the focus on resolution of disputes about procedural fairness by reference to the flexible content of the duty. The usual question, on the applicants' approach, would not be the requirements of procedural fairness in the particular case, but whether the duty applies to the particular exercise of power. This is the opposite of the formulation in Kioa v West at 585. Authorities that might be thought to support the applicants' approach (for example, Dunlop v Woollahra Municipal Council [1975] 2 NSWLR 446 and White v Ryde Municipal Council [1977] 2 NSWLR 909), on analysis, do not. Those disputes also were ultimately resolved at the content rather than the duty stage. Brennan J clearly advocated a "universal answer" to the question of duty (Kioa v West at 611). That approach is consistent with the observation in Alphaone at 550C - D. Although Brennan J's approach to the source of the duty has not found favour (see, for example, the discussion in Vanmeld at [50]) there is no dispute in the authorities that the issue of duty (and content) is primarily resolved through a process of statutory construction. McWilliam v Civil Aviation Safety Authority (2004) 142 FCR 74 at [43], referred to by the applicants, is not authority to the contrary as it is dealing with "decisions of an administrative character" for the purpose of the Administrative Decisions (Judicial Review) Act 1977 (Cth).

200 I have considerable difficulty accepting the proposition that an orthodox process of statutory construction could lead to a conclusion of a legislative intention that a single power might or might not be subject to the duty depending on the manner of exercise. As noted, the authorities relied on by the applicants do not support that approach. I consider that there either is or is not a duty to provide procedural fairness as a condition of the exercise of the power of amendment in s 45(1)(a). The content of the duty (if applicable) may vary depending on the particular circumstances of the exercise of the power, but its existence does not. Given the variable content of the duty, this conclusion may be of little practical significance.

201 It is necessary, therefore, to return to the operation of the statute. The issues of both duty (and, if duty, content) must be resolved in this context.

202 The power in s 45(1)(a) is to amend a plan by order published in the Gazette. The nature of a plan under the Water Management Act is thus the starting point. A plan is an instrument made under the Act and is thus an instrument for the purposes of the Interpretation Act, but is not a statutory rule subject to Parliamentary disallowance. The Minister makes plans (whether a management plan or a Minister's plan) by publication of an order in the Gazette. Plans endure for a period of 10 years. The Minister must review plans after their fifth year of operation to ensure their provisions "remain adequate and appropriate for ensuring the effective implementation of the water management principles" (s 43(2)). However, the Minister may also amend a plan from time to time if satisfied it is in the public interest to do so (s 45(1)(a)) or in the other two circumstances nominated in s 45. Plans are thus a tool (albeit not the only tool) to implement the objects and water management principles set out in ss 3 and 5 of the Water Management Act. Moreover, s 45(1)(a) suggests that plans are intended to be a flexible tool responding to any exigency arising that is capable of satisfying the Minister that it is in the public interest for the plan to be amended.

203 The exigencies capable of arising during the life of a plan may relate to a range of matters, including (as s 46(1) discloses) matters that trigger various compensation rights under the Act. All persons exercising functions under the Act have a duty "to take all reasonable steps to do so in accordance with, and so as to promote, the water management principles" (s 9(1)(a)). Insofar as the principles deal with water sharing, they recognise the potential for conflict between competing principles and provide for conflict resolution by the identification of priorities in s 9(1)(b). Hence, the first priority for water sharing is to protect the water source and its dependent ecosystems. The other categories of provisions with which a plan may deal (water use, drainage management, floodplain management, controlled activities and aquifer interference activities, and environmental protection) also highlight impacts on the water source and its dependent ecosystems.

204 In addition to implementing the water management principles, plans must be consistent with numerous other instruments that embody government policy (s 16). Those instruments, of their nature, represent outcomes of the political process at a very high level. For example, the State Water Management Outcomes Plan sets the over-arching policy context, targets and strategic outcomes for the management of the State's water sources having regard to the broadest possible considerations of environmental, social and economic issues, as well as inter-governmental agreements and international agreements to which the government of the Commonwealth is a party (ss 6(2) and (3)). State environmental planning policies have been described as the outcome of a political process (Save the Showground for Sydney Inc at 53). Protection of the environment policies concern the protection of the environment in New South Wales (s 10 of the Protection of the Environment (Operations) Act 1997). The nature of these instruments, with which a plan must be consistent, informs a proper understanding of the nature of a plan.

205 Plans may apply to water management areas or any part of the State not within such an area. Although any area may be constituted as a water management area, the statutory provisions relating to management committees indicate that (contrary to the applicants' submissions) the areas involved will be large. Water management areas are constituted by order published in the Gazette (s 11). A management committee for a water management area is also so constituted and must have 12 members including environment protection groups, water users, local councils, local catchment management authorities, Aboriginal persons and others. It is inconceivable that a water management area would be other than a large area, sufficient to justify a committee of this size and membership. This is a significant difference from the nature of local environmental plans that underpinned Spigelman CJ's dissenting analysis in Vanmeld (at [62]).

206 Insofar as water management areas are not constituted, the Minister's power to make a plan extends to the whole of the State and thus the provisions of such a plan might affect each and every person in the State. The applicants' reliance on s 50(1)(c) to support the Minister's capacity to make plans dealing with small areas and small issues (or "micro-plans" as the applicants termed it) does not give sufficient weight to the statutory provisions indicating the intended nature of plans (such as ss 16 and 18) and their content (such as ss 19 to 33).

207 The classes of plans that might be made will involve the interests identified in the water management principles. Plans must deal (either specifically or, for a Minister's plan, generally) with environmental water rules (ss 8A to 8E) in order to fulfil the objects of the Act with respect to ecologically sustainable development and to reflect the priority given to the protection of water sources and their dependent ecosystems by the water management principles. The statutory scheme thus embodies a series of basic propositions: - water resources are limited; the protection of the sources and their dependent ecosystems is paramount; basic landholder rights must be protected (that is, domestic and stock rights, harvestable rights or native title rights); sharing or extraction of water under any other right must not prejudice these principles but should be "orderly, efficient and equitable" (s 3(e)). Access licences fall in this latter category.

208 The statutory scheme also recognises another basic proposition about water management. Once the water source is identified as requiring protection (fundamental to the basic statutory object of sustainable management), the other interests identified in the water management principles will tend to interact and potentially compete with one another (as recognised by the statutory object of integrated management). In this context, every drop of water that is necessary to protect the water source is a drop not available for any other purpose. Every drop necessary to protect water dependent ecosystems is not available for basic landholder rights. Every drop available for basic landholder rights is not available for persons extracting under other rights. With respect to those other rights, every drop allocated to one person is a drop not available to any other person. An adjustment of any one interest through a plan will tend to adjust all other interests at least to some extent. Specifically, any benefit in terms of access to water to any one interest affected by a plan will be a form of detriment to each and every other interest affected by the plan.

209 Plans perform various other functions under the Water Management Act. Under Pt 2 of Ch 3 (dealing with access licences) plans can provide rules for priority between different types of access licences (s 58(3)). Those rules of priority will then operate with respect to any available water determination made by the Minister under s 60. The provision of rules determining priorities is another example of plans adjusting competing interests in a manner that will affect the value of all interests.

210 The provisions of the Water Management Act dealing with available water determinations recognise the limitations to which plans are inevitably subject. As noted, many circumstances may alter or arise during the life of a plan. Contrary to the applicants' submissions, s 59 (relating to available water determinations) operates with respect to all categories or subcategories of access licences (s 59(1)). The power is not limited to access licences dealing with specified proportions of water (as opposed to volumes of water). Nothing in s 59(1) so limits the power. References to the share component of the licence in the Act need to be understood in the context of the meaning of "share component" and "extraction component" in s 56(1) and (2). Section 56(2) discloses that the share component can be specified in any one of the ways identified. Even if the manner of specification is a volume of water that volume is a share component. The Minister, by order, can determine what water is available irrespective of the manner in which the licence is expressed. The available water determination will take effect according to its terms and will operate to prohibit the taking of water other than in accordance with the determination and the related allocation to the particular licence (s 341(b)). Available water determinations are thus an overriding power of the Minister to which all rights under access licences are subject. This facilitates the Minister's capacity to manage a resource of a dynamic character.

211 Plans are also relevant to the savings and transitional provisions of the Water Management Act (s 403 and schedules 9, 10 and 11). These provisions are necessary because, amongst other things, bore licences under the 1912 Act are not access licences as defined in the Water Management Act. The transition from the 1912 Act to the Water Management Act, therefore, required some conversion mechanism with respect to those (amongst other) licences. Entitlements under the former legislative regime had created the unsustainable situation that the Water Management Act was intended to address. Accordingly, without some mechanism to bring such entitlements within the scheme of the Water Management Act, the object (s 3) of "the sustainable and integrated management of the water sources of the State for the benefit of both present and future generations" could not be achieved.

212 As discussed above, Sch 10 regulates the process of conversion. Schedule 10 (by cl 1) applies to each and every access licence that relates to a part of the State or water source to which Pt 2 of Ch 3 applies by operation of a proclamation under s 55A. It also relates to each entitlement nominated under the 1912 Act in the definition of "entitlement" in cl 2. Part 2 of Sch 10 provides the mechanism for the conversion (by a deeming provision) of all former entitlements under the 1912 Act into access licences of a particular kind (see Sch 11) under the Water Management Act. Clause 3 of Sch 10 is of central importance in this conversion process. It deems the former entitlements to be replaced either by an access licence for the quantity of water specified in the former entitlement or, if a relevant management plan and regulations made for the purpose of the clause provide for a different quantity of water calculated in accordance with a specified methodology, by an access licence for that different quantity of water.

213 The power of amendment in s 45 has to be considered against this statutory background. The power is exercisable in three circumstances (where the Minister is satisfied it is in the public interest to do so, in such circumstances, in relation to such matters and to such extent as the plan so provides, or if the amendment is required to give effect to a decision of the Land and Environment Court relating to the validity of the plan). None of the conditions for the exercise of the power relate to the individual circumstances of licence holders. The relevant power in this case (s 45(1)(a)) relates to the Minister's state of mind about the public interest. As noted, the power in s 45(1)(a) may be exercised at any time the Minister holds the relevant state of satisfaction about the public interest (including, as s 45(4) makes apparent, an amendment before the commencement of the plan).

214 Accordingly, a plan represents the outcome of a series of adjustments or compromises between interlinked and potentially competing interests in a dynamic resource. The adjustments and compromises embodied in any plan are to give effect to high-level government policy (Div 1 of Pt 3). Government policy includes both the policy of the NSW government and of the Commonwealth government as reflected in inter-governmental and international agreements (s 6(3)).

215 A plan dealing with groundwater also operates against a background of significant political controversy resulting from the change in policy from the exploitation and diminution of groundwater resources to sustainable use, with priority to be given to protection of the resource and its dependent ecosystems. That policy change, reflected in the statutory scheme of the Water Management Act, indicates that there will be less water available for distribution between the various interests, including at the initial stage of general conversion from entitlements under the 1912 Act to aquifer access licences under the Water Management Act implemented by Sch 10 (cl 3(1)(a)). These are the circumstances that caused Spigelman CJ to describe the operation of the Water Management Act and plans as inevitably creating "winners and losers" (Murrumbidgee Groundwater Preservation Association at [144]).

216 The potential for political controversy involved more than the initial change from diminution of the resource to sustainable use. The first method for implementing the changes required to achieve the statutory prescript of sustainable and integrated management was across-the-board cuts as reflected in the provisions of the plan before the amendment order. This was altered to a policy of cuts based on historical extraction. When, as is the case, both methods relate to a lesser volume of water available for distribution (because of the statutory requirement to protect the water source) each method will create different "winners and losers".

217 These considerations expose difficulties in the applicants' approach to the question of duty and, as the respondent submitted, the illusory distinction between Sch 5 (said to impact on individual circumstances) and the other provisions of the plan effecting water sharing (said to involve general and indiscriminate rules). A number of propositions emerge from the foregoing discussion.

218 First, every person with an entitlement under the 1912 Act throughout the State is potentially subject to the transitional arrangements under Sch 10.

219 Secondly, once a proclamation is made under s 55A with respect to a water source, every person with an entitlement under the 1912 Act relating to the water source becomes potentially subject to those transitional arrangements through the application of a plan and regulation for the purposes of cl 3(1)(a)(ii) of Sch 10.

220 Thirdly, the process of conversion authorised by the statute involves two options (getting the same quantity of water or a different quantity of water). As soon as the prospect of a different quantity of water arises for any licence holder, the statutory focus on the protection of the water source and its dependent ecosystems, and the scheme for available water determinations and priority, means that the interests of every person or body affected by the plan (including not just licence holders, but those with special interests in protecting dependent ecosystems) are interlinked and potentially competing. In consequence, every decision that the provisions of a plan embody involves an adjustment between one interest and all other interests (or, in other language, a potential detriment or adverse conclusion).

221 Fourthly, the power to amend a plan if the Minister is satisfied that it is in the public interest to do so, which is exercisable from time to time, will itself necessarily involve an adjustment between one interest and all other interests.

222 These matters indicate that if the Minister's exercise of power to amend a plan if satisfied that it is in the public interest to do is conditioned on the giving of procedural fairness, then the duty would be owed to each and every person with any interest potentially affected by the plan.

223 The applicants described their bore licences as an important and valuable right attached to their properties. They characterised the amendment order (more specifically, the fact they do not appear in Sch 5) as an interference with or diminution of these rights as a consequence of a process singling out individuals without giving the applicants procedural fairness. The context, however, must not be lost. Context tends to be lost by treating Sch 5 as if it involved a decision-making process in isolation from the broader operation of the statute, including the transitional arrangements in Sch 10 applicable to each and every licence under the 1912 Act.

224 Schedule 5 demonstrates the importance of these propositions. Every drop of water allocated to the licence holders nominated in Sch 5 reduced the total available to each and every other licence holder affected by cl 25C(5). In this sense, each and every submission made by any licence holder that might have led to their inclusion in Sch 5 was adverse to the interests of each and every other licence holder. So too, however, every submission by any licence holder affected by cl 25C(5) (and thus not in Sch 5) about their own history of extraction (irrespective of any claim for special circumstances) was potentially adverse to every other licence holder because of the proportional adjustments embedded in the formula for determining any one licence holder's share component (cl 25C(5)). The same propositions, moreover, hold for each other adjustment in cl 25C (such as the decision to give the same amount of water to those whose entitlements were equal to or less than 100ML as set out in cl 25C(3)), including the adjustments embedded in the formula in cl 25C(5). Schedule 5 (given effect by cl 25C(4)) thus represented but one small component of the more general process of statutory conversion of each and every licence under the 1912 Act into an aquifer access licence under the Water Management Act with a share component in a limited resource.

225 As the respondent submitted, this statutory context suggests that an exercise of power to amend a plan under s 45(1)(a), properly analysed, does not involve an impact on individuals in the requisite direct and immediate sense, irrespective of the form or manner of any particular exercise of the power. Any amendment to a plan will necessarily impact on all people with any interest in the water source as a class even though the impact itself might be different. This is so whether the relevant provision is expressed in general terms or (as in Sch 5) by reference to individual licences. Hence, in the present case every provision of the amendment order affected licence holders by reference to their status as members of the class of holders of licences to be converted into access licences. Within that class every adjustment affected (albeit differently) every member of the class.

226 There are other indications in the statutory scheme of relevance. The Minister's power to amend a plan in s 45(1) is freestanding. It is not subject to the more general capacity for amendment in s 42 (s 42(2)). Section 45 requires the Minister to obtain concurrence from the Minister for the Environment but does not otherwise prescribe any consultation or notification obligations on which the power is conditioned. This is consistent with the special position of the Minister in the statutory scheme. The notification and exhibition provisions in ss 36 - 41 do not bind the Minister when making a plan unless the Minister chooses to adopt those provisions in any particular case (s 50(2A)). Section 47(5) refers to the rules of natural justice (procedural fairness) in the context of the jurisdiction of this Court (overcoming the effect of Edmondson) and must be read in the light of s 47(7). In contrast, the statutory provisions are specific about the Minister's notification obligations when it comes to dealing with individual access licences (in contrast to the general statutory conversion effected by Sch 10). Sections 67 (subsequent imposition of conditions on an access licence), 78A (suspension or cancellation of access licences), and 102 (imposition or variation of conditions on approvals) are examples of such provisions. In isolation these provisions may be too equivocal to be determinative. But they are consistent with an approach to the nature of the statutory power of amendment described above.

227 The nature of the power in s 45(1)(a), considered in this statutory context, is inconsistent with the application of the duty of procedural fairness. Adopting the language of the various decisions discussed above, it is a power that, if exercised, will affect a large and potentially indeterminate number of people. Even where apparently directed to any one individual or to an identifiable class, all other individuals with an interest in the water source will be affected by reason of the interlinked interests involved. It is a power exercisable from time to time to enable the Minister to manage a limited resource consistently with the water management principles, conditioned not on the interests of any individual but the Minister's view of the public interest. Factors influencing the Minister may be both foreseen and unforeseen. They will involve potentially conflicting considerations about a basic resource. Resolution of these considerations is a political endeavour for which the Minister takes political responsibility. For these reasons I do not accept the applicants' submissions that an exercise of power under s 45(1)(a) is conditional on the giving of procedural fairness.

228 It follows from this conclusion that the applicants' focus on the process as involving an invitation to have a licence holder's special circumstances considered is immaterial, as are the details of the process. As the respondent submitted, the doctrine of legitimate expectations cannot impose a duty where none exists (Darling Casino at 609, Quin at 39 and Lam at [82]). Accordingly, the Department's extensive endeavours to consult widely with potentially affected people cannot impose a duty of procedural fairness on the Minister exercising powers under s 45(1)(a) when none exists.

229 If I am wrong about the duty issue, these matters are equally relevant to content.

230 The applicants' submissions highlighted the distinction between those claiming "special circumstances" and others. The label "special circumstances" (although used routinely by the Department, the various committees and the Minister after the change from "anomalies") tends to obscure the process as it in fact unfolded. A request for "special circumstances" meant a licence holder who had responded to the invitation to dispute their history of extraction by submitting that, for some reason or another, the history of extraction approach to water sharing between licence holders with interests in the same water sources should not apply to them at all. Numerous licence holders took that opportunity of their own volition. Given this, it is difficult to accept that any duty of procedural fairness prevented the Department, the GAAC and the MRGVC from thereafter reviewing the submissions and deciding that those that established purchase, development or investment based on the plan before the announcement of the history of extraction approach were not adequately dealt with. In other words, as the sequence of events described above discloses, the criteria for acceptance of special circumstances emerged from the Department's consideration of the submissions made. There was no representation or declared procedure indicating anything else would occur.

231 The applicants' argument, when analysed, is that the duty of procedural fairness required the Minister to (at least): - (i) give every licence holder an opportunity to present an individual case to the Minister (whether directly or through the use of delegates and committees) as to why the history of extraction approach to water sharing ought not to apply to them, (ii) inform every licence holder of the framework or criteria which the Minister would apply to assess such submissions, (iii) give every licence holder the opportunity to make submissions as to the appropriateness of the framework or criteria, (iv) consider each submission, (v) inform each licence holder of any reason why their submission as to the framework or criteria and as to the application of the history of extraction approach to them was not persuasive, and (vi) allow each licence holder to address these "adverse conclusions" before any exercise of power to adjust the basis for water sharing in the plan. The cases discussed above, however, expose the variable content of the duty. As Mahoney JA observed in Gardner (at 552C), procedural fairness (if a condition of an exercise of statutory power) does not necessarily require the giving of an opportunity to present an individual case or present a case individually. The statutory scheme imposes no such obligation on the Minister (see above).

232 A failure to adhere to a declared procedure may constitute or result in a failure to accord natural justice (Darling Casino at 609). In this case, however, the declared procedures did not involve any consideration of individual circumstances by the Minister. Insofar as there was any declared process it involved a committee considering submissions licence holders had taken the opportunity to make outside the scope of the invitation to verify or dispute records of their history of extraction. The Minister's letter of 17 May 2006 referred to this committee and assured the Tubbo applicants their submission would be taken into account in making the final decision. In context, this is a reference to the stakeholder consultation being undertaken through the committee under the control of the Murrumbidgee Catchment Management Authority. It is not a declared process in which the Minister personally would undertake a review of all submissions presented as a late developer or special circumstances. As the respondent submitted, the Minister simply adopted the recommendations made. Given the statutory provisions and the terms of the declared procedure (insofar as it was declared at all) there was no obligation on the Minister to turn his mind to the circumstances of any individual licence holder.

233 Nor, practically, could the Minister be so bound. The consultation process concerned the basis for water sharing in water sources across six regions. All 1405 licence holders across the six regions were invited to dispute their history of extraction. About 335 did so with many others using the opportunity to present a case as a late developer or as having special circumstances. After responses by the Department there were still 187 licence holders who requested a further review by the regional groundwater verification committees. As discussed above any attempt to maintain a meaningful distinction between cl 25C(4) of the plan (making Sch 5 operative) and cl 25C(5) (or any other water sharing provision such as cl 25C(3)) founders when confronted by the way in which the plan actually operates.

234 If the applicants are correct about the duty requiring the Minister to consider the individual circumstances of licence holders then the applicants' submissions do not disclose any logical reason to limit the duty to those claiming special circumstances. A licence holder disputing their history of extraction and a licence holder claiming special circumstances both involved the interests of the individual (at least as posited by the applicants).

235 On this basis the Minister would have had to consider the responses of all 1405 licence holders (or at least an accurate summary of each of their cases). Moreover, on the applicants' approach to the duty, the Minister would have had to inform each and every one of them about any adverse conclusion before being able to proceed further. As I have said, every time the Minister accepted one person's submission it would be potentially adverse to every other person with an interest in the same water source because the interests are interlinked and potentially competing. This "would be unworkable, because it would lead to an infinite regression of counter-disputation" (South Sydney City Council at [267]). It would also be incapable of achieving the statutory objective of "the sustainable and integrated management of the water sources of the State for the benefit of both present and future generations".

236 For these reasons, I do not accept that any duty of procedural fairness required the Minister to provide any licence holder with an opportunity to present an individual case or present a case individually (Gardner at 552C). The applicants did not suggest that any person or body other than the Minister (such as the MRGVC) owed a duty of procedural fairness.

237 I also do not accept the applicants' submissions based on lack of and confused lines of authority from and between the Minister, the Department, the GAOC, the GAC, the GAAC, and the MRGVC. It is true that discrepancies are apparent when one compares the terms of reference of the various committees with the actions taken by those committees. It is equally true that the documents do not disclose any written authority from the Minister to the various committees (or, indeed, the Murrumbidgee Catchment Management Authority). Section 388 allows the Minister to establish advisory committees. Section 389A allows the Minister to authorise catchment management authorities to assist in the development of, in consultations about or in the implementation of management plans. Neither section involves a delegation of the Minister's functions or requires the establishment or authority to be in writing.

238 The Minister, as the facts recorded above disclose, knew the various committees existed and knew what they were doing. The amendment order involved an adoption of the committees' recommendations. In making the amendment order the Minister must be inferred to have authorised the committees' activities irrespective of the terms of reference. The presumption of regularity operates with respect to the committees and their activities in terms of Ministerial authority (see, for example, Roads and Traffic Authority (NSW) v Ashfield Municipal Council (2005) 141 LGERA 278 at [50] - [61] and VAW (Kurri Kurri) Pty Ltd v Scientific Committee (Established under s127 of the Threatened Species Conservation Act 1995) (2003) 58 NSWLR 631 at [226]).

239 In any event, the Minister was entitled to receive advice from any source the Minister chose. The fact that he did so through various committees (whatever their constitution or terms of reference) does not indicate any breach of procedural fairness. As the respondent submitted, the nature of the task at hand would render it impractical for the Minister personally to review all submissions and the Minister had no obligation to do so. The Minister was entitled to rely on his Department and the various committees established for the purpose of review, advice and recommendations. The potential for confusion in the minds of licence holders (specifically, the applicants) about the lines of authority raises a different issue. In this case, however, the complexity of those lines of authority is not material. As the respondent observed, both applicants (one way or another) made multiple submissions to most people and bodies in some way involved in the decision-making process. Further, if I am correct about the content of any duty, the applicants' submission that the Minister improperly delegated part of his function to the committees should not be accepted.

240 If a contrary conclusion about the content of the duty is reached (that is, the Minister was bound to consider the circumstances of each licence holder claiming special circumstances) then many of the applicants' claims can nevertheless readily be dismissed. This is because the applicants' submissions sought to impose on the making of the amendment order all of the machinery and onerous requirements of an adversarial hearing by a judicial or quasi-judicial body.

241 The applicants submitted that because the ASGE program identified certain key principles (to recognise water-dependent investment made by licence holders and that all groundwater entitlements, whether extracted or not, have value) they were entitled to make submissions about the matters that could be considered by those involved in the decision-making process when identifying whether a licence holder was subject to special circumstances. I disagree. First, the applicants' case appeared to assume that the process with respect to anomalies or special circumstances was represented to them as inevitably leading to inclusion or exclusion from Sch 5. That is incorrect. For much of the process, the various committees involved considered that any case of an anomaly or special circumstances would not be dealt with in the plan at all but through financial assistance. Secondly, the applicants' case appeared to assume that the plan as amended is inconsistent with the key principles. That involves a highly subjective view of both the key principles and the provisions of the plan and seems to disregard the intricacies of cl 25C (particularly the asset value protection component and the weighting component in the formula in cl 25C(5)). Thirdly, with an interlinked series of interests, every consideration thought to be relevant by any person involved in the process, on the applicants' case, would have to be notified to the applicants (indeed, to every interested person) before the matter could proceed further. This approach to the content of any duty of procedural fairness has already been dismissed above.

242 For similar reasons and on the same assumption, I do not accept the applicants' submissions about not having been notified of adverse conclusions (either generally or specifically, in the case of the Harvey applicants and the letter from Coles Supermarkets) as a breach of the requirements of procedural fairness. As the respondent submitted, procedural fairness does not ordinarily require a decision-maker to disclose their thinking process (for example, South Sydney City Council at [261]). Again, in the context of what the process of making the amendment order involved (including but not limited to Sch 5), imposing an obligation on those in any way involved in the decision-making process to disclose to licence holders every piece of information that might be considered adverse would be unworkable because it too would lead to an infinite regression of the kind identified in South Sydney City Council at [267]. The same reasoning applies to the submission that procedural fairness required the applicants to be informed about the recommendations of the MRGVC and given another opportunity to comment before the Minister made a final decision.

243 The submission that the Minister improperly failed to advise the Harvey applicants of adverse information from Coles Supermarkets is unsustainable on the facts. Coles Supermarkets wrote to the Minister at the request of Mr Harvey. An adviser to the Minister called the author of the letter in an attempt to understand the context of the letter (which was not readily apparent on its face). Nothing suggests that the information obtained (namely, that it related to the change of policy to share components based on history of extraction) was adverse to the Harvey applicants in any meaningful sense.

244 I also do not accept the suggestion that there was some inflexible application of policy thereby denying the applicants procedural fairness. As the respondent submitted, the Minister was entitled to give effect to government policy about using history of extraction as a method for reducing extractions of groundwater to sustainable levels. Under s 16(1), management plans are required to be consistent with government policy. An amendment to a plan that the Minister considered in the public interest could not be invalid for giving effect to that which the statute requires. This demonstrates some of the difficulty in accepting the applicants' other proposition that the amendment order was invalid because the Minister failed to consider the individual circumstances of the applicants. The Department's review of the various submissions received during the exhibition period raising issues of individual unfairness is telling. The comment on the submissions about individual unfairness (which I infer was endorsed by the Minister given his referral to the review and comments in the letter of 18 September 2006 seeking concurrence from the Minister for the Environment) was "Cabinet has endorsed the default method of entitlement reduction as recommended by the Murrumbidgee CMA after extensive consultation".

245 The issue of reasons seemed to be related to the applicants' case on ss 46 and 87AA discussed under the "amendment challenge" ground above. Insofar as it might be related to the procedural fairness ground, I do not accept that the Minister was obliged to give reasons about the amendment order or any part of it (such as Sch 5). The Water Management Act does not impose any obligation on the Minister to give reasons for an exercise of power under s 45(1)(a) either by express provision or necessary intendment. The applicants' arguments based on ss 46 and 87AA as requiring reasons fail to recognise that the sections depend on the existence of objective facts arising from the operation of the plan or amendment. Similarly, the idea that the Minister for the Environment must be given reasons to provide meaningful concurrence under s 45(3) is unsustainable. The provisions of the amendment suffice for discharge of that function. As the respondent observed, if the Minister for the Environment required more then a request could be made.

246 If the Minister was subject to a duty of procedural fairness in making the amendment order and the duty required the Minister to consider individual submissions of licence holders as to why the history of extraction approach ought not to apply to them, then the facts disclose only one real issue. The issue is simply that, having reviewed the submissions and worked out the framework within which it was agreed that the regional verification committees should assess submissions for special circumstances, the submissions as made were passed on to the MRGVC without the applicants (or, presumably, other licence holders) being informed of the framework. In this regard I accept that the period of December 2002/February 2003 to June 2004 and the assumption of 52% of entitlements were not obvious or self-evident to those seeking to escape the application of the history of extraction approach (see OzEpulse Pty Ltd at [55] - [56]). Further, the communications from the NSW Irrigators' Council did not make them so (recognising that the NSW Irrigators' Council was not representing the Minister but was merely a member of the GAAC and MRGVC). But the process must be considered as a whole to determine the question of breach of any duty.

247 The framework or criteria emerged from consideration of the submissions themselves. The process never involved more than looking at the submissions already made. In this sense, there were no "secret criteria" to obtain special circumstances as the applicants submitted. When submissions were invited and made there were no criteria at all other than the published rules with respect to history of extraction.

248 When making recommendations as to whether any licence holder had special circumstances the MRGVC, as Mr Painting said, considered each individual case on its merits and generally recommended that there were special circumstances where licence holders could demonstrate purchase, investment and development between December 2002/February 2003 and June 2004 on the assumption that there would be a cut in entitlements to 52% of entitlements under the 1912 Act. This is consistent with the documentary evidence.

249 Annexure D to the email of 13 April 2006 and subsequent documents demonstrating the process of consideration show that, but for the time period between December 2002/February 2003 and June 2004 and the assumption of 52% of entitlements guiding the purchase, investment, or development potentially relevant factors were identified (rather than mandated), and were subject to the express overriding requirement that each individual licence holder's submission claiming special circumstances be carefully considered. The process adopted by the MRGVC shows that each licence holder's submission was carefully considered across the full range of matters raised.

250 It is true that the applicants (particularly the Harvey applicants) possessed information relevant to their investments and developments in the period of December 2002/February 2003 to June 2004 on the assumption that they would have access to at least 52% of their former entitlements. If (contrary to my conclusions) the process miscarried because they were not informed about the framework or criteria the Department had formulated by considering the submissions then difficult issues of discretion would arise.

251 With respect to discretion, I accept the respondent's submission that, if the amendment order is invalid, the plan commenced in its unamended form on 1 October 2006. Accordingly, the plan (in its unamended form) would provide the basis for available water determinations. The position of the applicants can never be a return to their entitlements under the 1912 Act. In common with every other licence holder, the applicants can never obtain a greater entitlement than their proportion of available water determinations made having regard to (amongst other things) the long-term average extraction limit of 270,000ML per year established by cl 27. The applicants' argument that the plan never commenced in its unamended form overlooks two facts. First, the plan immediately before the amendment order provided a commencement date of 1 October 2006. Secondly, the validity of the proclamation under s 55A has not been challenged in these proceedings and must be assumed to be valid. The proclamation relates in terms to the water sources the subject of the plan irrespective of the amendment order.

252 The applicants are two licence holders in the deep groundwater source (amongst at least 176 others) who had a bore licence converted to an aquifer access licence with a share component involving entitlements to a different quantity of water. Specific evidence of reliance on the validity of the plan as amended by licence holders is not required. It is obvious that since 1 October 2006 many people will have made arrangements in reliance on the operation of the plan, including the temporary and permanent trades and compensatory payments referred to by the respondent. The fact that the challenge was brought within the period of three months provided in s 47(2) would not undermine the inevitable question of the proportionality of the remedy of declaring the amendment order invalid having regard to the potential impacts on the position of third parties (as contemplated by Vanmeld at [78]).

253 Given my principal conclusions set out above, however, it is not necessary to consider this difficult issue of discretion.

E. Conclusion and orders 254 The applicants have not established that the amendment order is vitiated for jurisdictional error. The amendment order involved an amendment to the plan authorised by s 45(1)(a) of the Water Management Act. It did not involve any extension of the duration of the plan in breach of s 45(4) of that Act. The Minister did not owe the applicants a duty of procedural fairness when making the amendment order. Alternatively, if he did, the content of the duty did not require the Minister to hear or consider submissions from individual licence holders about the reasons why they should be treated as having special circumstances. Accordingly, the applicants have not made out their cases for declaratory and other relief. The orders are as follows in each matter: (1) The Class 4 applications are dismissed.

(2) The exhibits may be returned. The parties are directed to notify my Associate within 7 days whether they agree with respect to the issue of costs. If not agreed, the matter will be listed for a short hearing on costs as soon as possible.

18/06/2008 - Date delivered has been added on the coversheet - Paragraph(s) N/A

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