Hope Downs Management Services Pty Ltd v Hamersley Iron Pty Ltd [1999] FCA 1652 | Case summary

THE COURT 1 In separate appeals, Hope Downs Management Services Pty Ltd ("Hope Downs") and the National Competition Council appeal from a judgment of Kenny J delivered on 28 June 1999 by which her Honour declared: "1. The Rail Track Service as defined in Part 3 of the application for a declaration recommendation made pursuant to s 44F(1) of Part IIIA of the Trade Practices Act 1974 (Cth) (the Act) by the second to sixth respondents, is not a service within the meaning of section 44B of the Act; 2. The first respondent does not have power to make a recommendation regarding declaration of the Rail Track Service to the designated Minister pursuant to s 44F(2)(b) of the Act." 2 Her Honour also ordered that the application of the first respondent in these appeals, Hamersley Iron Pty Ltd ("Hamersley") be granted to the extent of the declarations made but otherwise be dismissed. The other parties to the proceeding before Kenny J (proceeding VG 581 of 1998) were the National Competition Council, Robe River Mining Co Pty Ltd, Mitsui Iron Ore Development Pty Ltd, North Mining Limited, Nippon Steel Australia Pty Limited, Sumitomo Metal Australia Pty Ltd and Hope Downs, the first to seventh respondents respectively. 3 Orders for costs were made by Kenny J on 3 August 1999 as follows: "1. The second, third, fourth, fifth, sith and seventh respondents pay 73% of the applicant's costs, including all reserved costs. 2. The second, third, fourth, fifth, sixth and seventh respondents pay the costs of and incidental to the first respondent's participation in the proceeding." Neither of the appellants has appealed against those costs orders but both have sought orders in their appeals that, amongst other things, Hamersley pay the costs of the application before Kenny J. 4 When the two appeals came on for hearing this morning, counsel for Hamersley informed the Court that a letter dated 18 November 1999 had been sent by Robe River Mining Co Pty Ltd to the National Competition Council giving notice pursuant to s 44F(5) of the Act that the application that had been the subject of the proceeding before Kenny J was withdrawn, with immediate effect. Counsel for the National Competition Council confirmed that a fax in those terms had been received by the Council and the matter before us has proceeded on the footing that the application has indeed been withdrawn. 5 Counsel for Hamersley then submitted that the Court should not proceed to hear the appeals which, he submitted, should be dismissed for the reason that, the application having been withdrawn, the appeals were now moot. 6 This submission was challenged by counsel for the National Competition Council, who submitted that there was still a live issue in relation to costs and that there were important reasons in the public interest why the appeals should proceed. He pointed out that the essential point in the appeals was a short one of statutory construction, which centred on the definition of "service" in s44B of the Act. 7 Counsel for Hope Downs submitted that costs were a live issue in its appeal too and that notwithstanding the withdrawal of the application, his client's appeal should proceed on the question of costs. Hope Downs also submitted that it had a direct interest in the appeal because it was a potential applicant for access to a rail service if the railway in question became a declared service. Moreover, Hope Downs apprehended that the orders made by Kenny J in the proceeding to which it had been added (on its own application) as a party might create an issue estoppel or a res judicata binding upon it. 8 As the arguments developed, several further aspects emerged. First, it became apparent that there was a third appeal in the matter, namely an appeal by Robe River Mining Co Pty Ltd and other respondents in that interest against the costs order made against it by Kenny J. This appeal had been stood over to await the outcome of the present appeals, and it was suggested that the resolution of that appeal might involve a consideration of the substantive issues that the National Competition Council and Hope Downs wished to argue. As it turned out, however, Robe River and its associates indicated by their counsel that this appeal was to be discontinued. This discontinuance was to be effected, as of right, by the filing of a notice of discontinuance under Order 52, Rule 19 of the Federal Court Rules. 9 Another aspect that emerged in the course of discussion was that the National Competition Council had, in fact, a costs order in its favour. Its counsel indicated, however, that if the Court were of the view that the Council's very limited remaining interest in costs meant that its appeal had to be seen as moot, it nevertheless wished to remain to take part in the proceedings as an intervener in the other appeal. 10 The position taken by Hamersley was that although there might have been a basis upon which the appeal could proceed on the question of costs, at least in relation to the Hope Downs appeal, the Court should nevertheless not proceed because of discretionary considerations to which it referred. It later reinforced that submission by offering undertakings to the Court as follows: "Hope Downs v. Hamersley (V402 of 1999) UNDERTAKINGS The first respondent undertakes to the Court as follows: 1. It will not enforce or otherwise seek to take advantage of paragraph 1 of the orders made by Kenny J. on 3 August 1999 in proceeding No. VG 581 of 1998 ("the proceeding"). 2. It will pay the costs of Hope Downs Management Services Pty. Ltd of the proceeding and of appeal No. V402 of 1999 up to and including this day, such costs to be taxed as between party and party. 3. It will pay the costs of National Competition Council of the proceeding, and of appeal No. V403 of 1999 up to and including this day, such costs to be taxed as between party and party. 4. In relation to any application made under Part IIIA of the Trade Practices Act 1974 by Hope Downs Management Services Pty. Ltd. or any of its related corporations and in relation to any proceedings (including proceedings before the Australian Competition Tribunal) in connection with that application, it will not contend that the declarations and orders made by Kenny J. in the proceeding on 28 June 1999, or the Reasons for Judgment upon which those declarations or orders were founded, give rise to any issue estoppel or res judicata affecting any contention raised by: (a) Hope Downs Management Services Pty. Ltd. or any such related corporation; or (b) National Competition Council." 11 Identical undertakings were offered in respect of the other appeal. 12 Counsel for the National Competition Council submitted that the Court was not obliged to accept the undertakings offered, and should not do so. Rather, he submitted, the Court should proceed to determine the remaining question of costs and thereby resolve what was a very important question of statutory interpretation. Counsel for Hope Downs informed the Court that in light of the undertakings offered, he had no further submissions to make and that the matter was one for the discretion of the Court. He did, however, make it clear that his client wished to proceed to argue the appeal. 13 There is ample authority for the existence of a discretion in this Court to stay an appeal in circumstances where there is nothing to be gained by the appeal proceeding: see Mayne Nickless Limited v Transport Workers Union of Australia (Black CJ, von Doussa and Carr JJ, 16 July 1998, unreported), Leibler v Air New Zealand Ltd [1998] 2 VR 525 (Victorian Court of Appeal) and R v Secretary of State for the Home Department ex parte Salem [1999] 2 All ER 42 (House of Lords). 14 Having regard to the undertakings submitted by Hamersley, which the Court is satisfied it should accept, no useful purpose in respect of the rights of the parties could be served by the Court proceeding to hear either of the appeals in relation to the question of costs. All questions of costs are covered on the most favourable possible basis by the undertakings offered by Hamersley and any possible prejudice resulting from the application of the principles of issue estoppel or res judicata has been removed by those same undertakings. And, as we noted at the outset, the subject matter of the whole litigation, the application to the National Competition Council for a recommendation under s 44F(1), has disappeared, consequent upon the action of Robe River in giving notice pursuant to s 44F(5) of the Act. 15 In these circumstances the appeals should be stayed. The Court should not, of course, be taken to have expressed any view about the correctness or otherwise of the judgment appealed from; the appeals have been stayed for reasons unconnected with their merits. 16 The offered undertakings having been given and accepted, the appeals are forever stayed. I certify that the preceding sixteen (16) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Court.

Hope Downs Management Services Pty Ltd v Hamersley Iron Pty Ltd

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