International Minerals Pty Ltd v State of Western Australia [2022] FCA 938 | Case summary

Federal Court of Australia|2022-08-12|Before: Downes J

Background 8 Last year, the applicant and Mineralogy Pty Ltd sought (amongst other things) a declaration in the High Court that the Amending Act was invalid. The High Court found that the Amending Act was not invalid: Mineralogy Pty Ltd v Western Australia (2021) 393 ALR 551; [2021] HCA 30 at [93] and [166]. The decision was delivered by the High Court on 13 October 2021. 9 A trial in a defamation proceeding was due to commence in the Federal Court in Sydney before Lee J on 31 January 2022, being a proceeding brought by Mr Palmer against the Hon. Mr Mark McGowan MLA, Premier of Western Australia, with a cross-claim by Mr McGowan against Mr Palmer. 10 On 25 January 2022, orders were made by Lee J including to the effect that the trial be listed to commence on 14 February 2022, instead of 31 January 2022: Palmer v McGowan (No 2) (2022) 398 ALR 524; [2022] FCA 32. That decision refers to the fact that Mr McGowan and the Attorney-General for Western Australia (the Hon. Mr John Quigley MLA) would be giving evidence at the trial. 11 On 27 January 2022, Mr Palmer announced in a radio interview that: One of the most important things is that tomorrow we'll serve legal proceedings in the Federal Court. We'll file legal proceedings seeking $50 million personal damages against McGowan, the Attorney-General Quigley, Solicitor General Thomson and State Solicitor Egan. These proceedings will allege deceit, dishonesty and malice against International Minerals, one of my companies, prior to the passing of the Amending Act. 12 When Mr Palmer discussed the proceedings on the radio on 27 January 2022, he was a party to the defamation proceeding and was aware, by reason of the hearing which had taken place on 25 January 2022, that the trial in that proceeding would commence on 14 February 2022 (that is, just over two weeks later) and that Mr McGowan and Mr Quigley would be witnesses at that trial. The applicant therefore also had that awareness. 13 Prior to commencing this proceeding, the applicant did not take any genuine steps to attempt to resolve the dispute which it claimed to have with the respondents, as contemplated by ss 4 and 6 of the Civil Dispute Resolution Act 2011 (Cth). 14 On 31 January 2022, the applicant commenced this proceeding against the State of Western Australia, Mr McGowan, Mr Quigley and the State Solicitor (Mr Nicholas Egan). Damages were claimed against the three individual respondents in the amount of $50 million. 15 The concise statement filed by the applicant on 31 January 2022 alleged that the State of Western Australia had acted unconscionably in contravention of s 21 of the Australian Consumer Law (being Schedule 2 to the Competition and Consumer Act 2010 (Cth)) (ACL) having regard to the circumstances which it alleged had occurred leading up to and surrounding the enactment of the Amending Act. Allegations were also made to the effect that each of Mr McGowan, Mr Quigley and Mr Egan had involvement in the enactment of the Amending Act, and so were said to have been knowingly involved and concerned in the contravention of the ACL. The conduct of Mr McGowan and Mr Quigley was also alleged to have been "deceitful and dishonest" and it was alleged that they had committed the tort of misfeasance in public office. 16 The genuine steps statement filed by the applicant on 31 January 2022 acknowledged that no steps had been taken to resolve the dispute but gave an explanation which included this statement: … in response to any notice by the Applicant of an intention to commence these legal proceedings, the First and Second Respondents are ostensibly empowered by the relevant legislation to take steps that could endanger the Applicant's property. To protect the Applicant's property, it has been necessary that the respondents not have notice that would give them an opportunity to take such steps prior to the commencement of these proceedings. (emphasis added) 17 However, Mr Palmer discussed the proposed proceedings on public radio some four days before they were filed. The explanation given in the genuine steps statement filed by the applicant - that the respondents could not be given notice of the proceeding - was therefore incorrect. 18 The trial in the defamation proceeding commenced on 14 February 2022. The decision in that matter was handed down on 2 August 2022: Palmer v McGowan (No 5) [2022] FCA 893. It is apparent from that decision, and from the pleadings filed in that matter (Exhibit 3), that many of the factual allegations relating to the Amending Act were also in issue in the defamation proceeding. Indeed, the catchwords of the decision of Lee J state "primary proceeding and cross-claim dominated by context of COVID-19 pandemic and enactment of Iron Ore Processing (Mineralogy Pty Ltd) Agreement Amendment Act 2020 (WA)". 19 On 15 February 2022, orders were made by consent in this proceeding which required that the applicant file a statement of claim by 16 March 2022. 20 On 15 March 2022, being the day before the statement of claim was due to be filed, the applicant's solicitors emailed the respondents' solicitors about the applicant's intention to discontinue the proceeding with a proposal to pay indemnity costs. That email relevantly stated: … my client has decided that it does not wish to vindicate its claims against the respondents in the manner claimed and has instructed me to discontinue the proceeding. The rules provide that proceedings may be discontinued without leave or consent before pleadings have closed. That is the case here. I will proceed to file a notice of discontinuance tomorrow. My client is amenable to pay your costs on an indemnity basis, either to be taxed or agreed on a lump sum basis. Please advise your clients' instructions in this regard. (emphasis added) 21 On 16 March 2022, an email from the applicant's solicitors to the respondents' solicitors included the following statement: I refer to my email yesterday (see below). My client has instructed me that it no longer intends to discontinue the proceedings. The proposal regarding costs is withdrawn. The Statement of Claim will be filed and served later today. 22 The statement of claim which was filed on 16 March 2022 expanded the causes of action beyond those referred to in the concise statement, and also varied and expanded the forms of relief being sought. It alleged that the second to fourth respondents had "entered into, and took steps to give effect to, an arrangement for the purpose of harming the Applicant", defined as a Scheme. It also alleged that a purpose of the Scheme was the drafting of and getting the Amending Act through the Western Australian Parliament. It alleged that Mr McGowan had distracted the "directing mind and will (Mr Palmer) of the Applicant by continually 'insulting' him through the media, to assist in preventing the Applicant suspecting something was on foot by the State". 23 At about this time, Lee J became aware of this proceeding and realised that there was an overlap in the factual issues in the defamation proceeding and this proceeding. On 21 March 2022, the Associate to Justice Lee sent an email to the legal representatives for the parties in the defamation proceeding. That email included this statement: Further, as a consequence of media reports, his Honour understands it may be that a further proceeding is in the process of being filed by Mr Palmer, which may canvass some factual matters to be determined by his Honour. His Honour has also now had the opportunity to obtain a copy of the pleading in proceeding NSD 54/2022 (a case commenced by International Minerals Pty Ltd against Mr McGowan and three other respondents), in which factual assertions are made that relate to part of the factual issues in contest in the defamation proceeding. His Honour requests the solicitors for Mr Palmer confirm, as soon as possible, what proceedings are on foot, or are proposed to be commenced, which concern allegations relating to what might be described as the passing of the Amendment Act. When his Honour receives a response, he will consider if it necessary to re-list the defamation proceeding to ascertain why it is that several judges of the Court may be called to resolve cases which, at least in part, rely on a similar factual substratum and may be thought to be part of the one "matter" (to use that word in its Constitutional sense). 24 By email in response to the Associate to Lee J, also on 21 March 2022, Mr Palmer's lawyers wrote: 1. The only proceeding brought by Mr Palmer as a plaintiff or applicant which is currently on foot, and which involves allegations relating to what might be described as the passing of the Amendment Act, is this proceeding NSD 912/2020. 2. Mr Palmer has no present intention of bringing any further proceedings as a plaintiff or applicant which involve allegations relating to what might be described as the passing of the Amendment Act. 3. Mr Palmer has no present intention of raising, in any existing or contemplated proceedings in which he is or might become a defendant or respondent, any allegations relating to what might be described as the passing of the Amendment Act. 4. Recent media reports asserting that "Clive Palmer is personally suing WA Premier Mark McGowan and Attorney-General John Quigley for $50 million", including an article which opened with those words and appeared under the headline "Clive Palmer sues mark [sic] McGowan and John Quigley for $50 million" in the online edition of The West Australian at 12.15 a.m. on Sunday, 20 March 2022, are inaccurate. Such media reports are apparently based on a misunderstanding of proceeding NSD 54/2022 - Mr Palmer is not even a party to that action. 25 The trial in the defamation proceeding resumed on 24 March 2022. On that date at about 2.15 pm, Lee J referred to what appeared to be the same factual allegations made in the two proceedings, and asked the parties to consider whether it would be appropriate to list this proceeding and hear from the parties as to whether there should be an order for a separate trial of those identical issues. 26 On 24 March 2022 at 3.09 pm, the Associate to Lee J wrote to the parties in this proceeding, stating relevantly as follows: Justice Lee is currently part-heard in proceedings NSD912/2020 Palmer v McGowan (defamation proceeding). A link to the online file in relation to the defamation proceeding as follows: Clive Palmer v Mark McGowan: Online File (fedcourt.gov.au). It has come to his Honour's attention that a large number of factual contentions are made in proceedings NSD54/2022 International Minerals Pty Ltd v State of Western Australia & ors (misfeasance proceeding), which are identical or are substantially similar to contested factual allegations made in the defamation proceedings (relevant factual allegations). After the similarity in relevant factual allegations became apparent to his Honour, the Judge has raised with the parties in the defamation proceeding why it is consistent with the case management imperatives reflected in Part IVB Federal Court of Australia Act 1976 (Cth) (Act), that the relevant factual allegations be canvassed in two separate proceedings and that any issue in relation to them be resolved, potentially on the basis of different evidence and with the (at least theoretical) prospect of inconsistent findings by different judges. … In all the circumstances, Justice Lee wishes to invite submissions from the parties in the defamation proceeding and the misfeasance proceeding as to why orders should not be made in both proceedings, pursuant to s 37P(2) of the Act, which would have the effect of ensuring that any factual issues that relate to the relevant factual allegations be determined by Justice Lee as soon as possible, that is, not only in the defamation proceeding (as currently contemplated) but also separately and before any other factual or legal issue in the misfeasance proceeding. This matter was canvassed at hearing of the defamation proceeding today, and a copy of the transcript of today's hearing will be provided as soon as it becomes available. In order to hear from the parties in the misfeasance proceeding (other than Mr McGowan) as to this proposal, his Honour has determined to list the misfeasance proceeding for a case management hearing before him at 4.15pm on 28 March 2022. … (emphasis original) 27 On 24 March 2022 at 4.26 pm, the applicant lodged the Notice of Discontinuance. 28 After the Notice of Discontinuance was accepted for filing, an order was made by Lee J in this proceeding on 28 March 2022 that, by 5.00 pm on 29 March 2022, the respondents were to file any interlocutory application which they wished to make consequent upon the filing of the Notice of Discontinuance, together with a brief outline of submissions that they would propose to make in support of such relief. 29 On 29 March 2022, the first to third respondents, and on 30 March 2022, the fourth respondent, filed an interlocutory application in similar terms. The applications seek these orders, in effect: (1) that the Notice of Discontinuance be struck out; (2) that leave be granted to the applicant to discontinue the proceeding, subject to a condition that neither the applicant nor Mr Palmer, or any entity controlled by him, should commence further proceedings in the Federal Court of Australia which contain allegations relating to the passing of the Amending Act without first obtaining the leave of the Court; (3) that the applicant pay the respondents' costs of the proceeding on the indemnity basis. 30 By its written submissions filed on 11 May 2022, the applicant put in issue the applicant's state of mind in relation to why the Notice of Discontinuance had been filed, including by reference to its decision on 15 March 2022 to discontinue and then its change of mind on 16 March 2022. Those submissions relevantly stated: [18] Further, the Respondents application is not advanced by its assertion that the Applicant discontinued in order to avoid the making of directions by which the overlapping factual issues would be determined concurrently" (R4[19], [20(g)],[21]). Firstly, even if that assertion were true (and it is denied), it does not establish that the Applicant secured a collateral advantage by bringing and then discontinuing the proceeding in question, so as to amount to an abuse. … [30] The underlying factual premise for the applications is that: "[i]t is presently open to infer that the Applicant discontinued the proceedings on 24 March 2022 in order to avoid the making of directions by which the overlapping factual issues would be determined concurrently" (R4[19], [20(g)], [21]). … [35] As regards the alleged purpose of discontinuance, the Respondents rely on the timing of the discontinuance and the context of the discontinuance, namely, that Justice Lee had yoked together the two proceedings, or part thereof. Irrelevantly in the context of an unconditional right to discontinue, it is also said that the discontinuance remains unexplained. … [37] The inference the Respondents request the Court to draw cannot rise above speculation. Relevant in this context is the fact that the Applicant had previously, and hence wholly unrelated to Justice Lee's intervention in this proceeding, considered discontinuing the proceeding (notwithstanding it changed its mind). It is open to inference therefore that other considerations were relevant to the decision (ie considerations independent of Lee J's proposed directions hearing (announced ten days later). Certainly the evidence of the earlier conduct is inconsistent with the inference which the Court is asked to draw. Further, a critical integer in the inference which the Respondents ask the Court to draw is the further inference that the Applicant believed that it would secure some improper collateral advantage in discontinuing and not having common matters litigated before Justice Lee. There is no evidence which would justify such a finding. On the contrary, any suggestion the Applicant was acting so as to impermissibly preserve its ability to re-litigate the same matters in a new subsequent proceeding before a different judge is absurd. The Applicant would never be able to avoid scrutiny of any new claim it issued or the consequence which might follow if the institution of any new proceeding were found by a subsequent court to constitute an abuse of process. Quite simply, the course taken by the Applicant could not rationally be seen as being motivated by a desire to impermissibly avoid any adverse consequences arising from Justice Lee's proposal or to secure some form of collateral advantage. The absence of explanation does not take matters further. A failure to give evidence does not constitute evidence. (footnotes omitted) 31 On 11 May 2022, the first to third respondents filed and served a notice to produce on the applicant to produce all documents (including legal advice) in its control evidencing or recording the reasons for: (1) the applicant's decision to discontinue the proceeding on or about 15 March 2022; (2) the applicant's decision to reverse the decision referred to in (1), on or about 16 March 2022; and (3) the applicant's decision to discontinue the proceeding on or about 24 March 2022. 32 The hearing of the applications occurred on 12 May 2022 and a call on the notice to produce was made by senior counsel for the first to third respondents. 33 The applicant objected to the call on the basis of relevance and legal professional privilege. However, it was ruled that the applicant was required to respond to the call because, as demonstrated by its written submissions which are extracted in these reasons, it had put its state of mind directly in issue, and, further, it had acted inconsistently with the maintenance of legal professional privilege: Commissioner of Taxation v Rio Tinto Limited (2006) 151 FCR 341; [2006] FCAFC 86, [61]. 34 What was produced in response to the call were two documents containing email exchanges, the contents of which were not of any probative value for the purposes of determining the applications. 35 The applicant adduced no evidence which explained the circumstances behind its solicitor's emails of 15 and 16 March 2022, or why, on the same day as Lee J raised the prospect of a separate trial to determine common questions of fact between this proceeding and the defamation proceeding, the Notice of Discontinuance was filed.

Whether Federal Court has power to strike out a notice of discontinuance as being an abuse of process 36 Rule 26.12(2)(a)(ii) relevantly provides: (2) [A] party may file [a] notice of discontinuance: (a) without the leave of the Court or the other party's consent: … (ii) if the proceeding is continuing on pleadings - at any time before the pleadings have closed; … 37 In this case, there was no dispute that the applicant did not require the leave of the Court or the consent of the respondents to file the Notice of Discontinuance. 38 By its written outline, the applicant submitted that s 23 of the Federal Court of Australia Act 1976 (Cth) confers power on the Federal Court in relation to "matters in which it has jurisdiction" and that, as the Notice of Discontinuance had been filed, "it may be arguable therefore that there is no longer a matter … before the Court in relation to which the Court can exercise its jurisdiction" (emphasis added). However, by those submissions, the applicant appeared to accept that the Court would at least have an implied power to strike out a notice of discontinuance so as to prevent an abuse of its processes, but submitted that this power must be "carefully confined". 39 During the hearing, however, senior counsel for the applicant accepted that the Court had power to strike out the Notice of Discontinuance "whether it's derived from section 23 or some other part of the Act to control an abuse of the court's processes". 40 That the Court has such a power is supported by the reasoning of the Full Court in Chen v Monash University (2016) 244 FCR 424; [2016] FCAFC 66 (Barker, Davies and Markovic JJ) (which was cited by the applicant). In that case, it was accepted that the Court had jurisdiction to reinstate an appeal following the filing of a notice of discontinuance in circumstances where it must do so in order to prevent an abuse of process or to protect the integrity of the Court's processes. The Full Court stated at [40]-[41]: The power of the Court to prevent any abuse of frustration of or interference with its processes may, having regard to these authorities, either be seen as an implied power of the Federal Court that exists quite independently of s 23, but amplified by s 23; or an implied power derived from s 23 [Federal Court of Australia Act 1976 (Cth)]. We consider that under such an implied power, or pursuant to s 23, this Court may, in an appropriate circumstance, reinstate a discontinued appeal in order to prevent an abuse of process of the Court or to protect the integrity of those processes. 41 Further, in Christodoulou v Disney Enterprises Inc (2006) 156 FCR 369; [2006] FCAFC 183 at [28] (North, Mansfield and Besanko JJ), the Full Court accepted that the Court has power to set aside a notice of discontinuance, but did not express a final view as to all of the circumstances in which that could occur. 42 That the Court has jurisdiction to strike out a notice of discontinuance if its filing constitutes an abuse of process was accepted by Perram J in Moussa v Minister for Immigration and Border Protection [2015] FCA 1280 at [9]-[10]; see also Wool International v Sedgwick Limited (No 2) [1997] FCA 709 (Beaumont J); Applicant A26 of 2002 v Minister for Immigration & Multicultural & Indigenous Affairs [2003] FCA 1050 at [2] (Mansfield J); NACU of 2001 v Minister for Immigration & Multicultural & Indigenous Affairs [2004] FCA 1444 at [7] (Hill J). 43 For these reasons, I am satisfied that the Court has jurisdiction to hear the respondents' interlocutory application and to strike out the Notice of Discontinuance if it is established that its filing constituted an abuse of process.

Whether the Notice of Discontinuance should be struck out

Relevant principles 44 Whether conduct rises to the level of abuse of the processes of the court is a determination which requires consideration of all of the circumstances: UBS AG v Tyne (2018) 265 CLR 77; [2018] HCA 45 at [7] per Kiefel CJ, Bell and Keane JJ, who accepted that this consideration requires the court to make: "a broad, merits-based judgment which takes account of the public and private interests involved and also takes account of all the facts of the case, focusing attention on the crucial question whether, in all the circumstances, a party is misusing or abusing the process of the court by seeking to raise before it the issue which could have been raised before. As one cannot comprehensively list all possible forms of abuse, so one cannot formulate any hard and fast rule to determine whether, on given facts, abuse is to be found or not." 45 In Castanho v Brown & Root (UK) Ltd [1981] AC 557, a notice of discontinuance had been filed which had been struck out at first instance as being an abuse of process of the court. Lord Scarman (with whom the other Lords agreed), relevantly observed at 571 that: "[t]he court has inherent power to prevent a party from obtaining by the use of its process a collateral advantage which it would be unjust for him to retain: and termination of process can, like any other step in the process, be so used." In deciding whether the notice of discontinuance was an abuse of process, the relevant test adopted by Lord Scarman at 572 was whether, if leave had been required to file the notice of discontinuance, it would have been granted unconditionally: see also Packer v Meagher [1984] 3 NSWLR 486, 491 (Hunt J). The House of Lords concluded that the notice was an abuse of the process of the court in that case. 46 The court's legal processes will be abused where it is used to exert pressure to effect an object not within the scope of the process, or where it is used for a purpose other than that for which the proceedings are properly designed and exist, or where the plaintiff in those proceedings is seeking some collateral advantage beyond what the law offers: Packer at 492, which was applied in Frigger v Holbrook [2015] WASC 469 at [45] (Mitchell J). 47 Further, the determination of whether the bringing or continuance of proceedings is an abuse of the processes of the court must take into account the procedural law administered by the court whose processes are engaged: UBS AG at [34] (Kiefel CJ, Bell and Keane JJ). The overarching purpose stated in s 37M of the Federal Court of Australia Act 1976 (Cth) is germane in that respect, that purpose being to facilitate the just resolution of disputes as quickly, inexpensively and efficiently as possible. 48 The courts must be astute to protect litigants and the system of justice itself against abuse of process: UBS AG at [45] (Kiefel CJ, Bell and Keane JJ). Further, as their Honours continued at [45]-[46]: … It is to hark back to a time before this Court's decisions in Aon and Tomlinson and the enactment of s 37M of the FCA to expect that the courts will indulge parties who engage in tactical manoeuvring that impedes the "just, quick and efficient" resolution of litigation. … Further, there is no reason why the courts should tolerate attempts to manipulate other parties and the courts themselves by the deployment, by a single directing mind and will, of different legal entities under common control for such a purpose. The concern is as to whether the processes of the court are being abused. Given that this is the central concern, the circumstance that the abuse is effected by the use of multiple entities orchestrated by a single mind and will is no reason to tolerate it. Nor does the undue vexation which a stay of proceedings is concerned to prevent arise only when proceedings in respect of the same issue have been concluded by a judgment on the merits. Serial proceedings discontinued prior to judgment would be an obvious example of an abuse of process. The pursuit of substantially the same claim by serial proceedings conducted by different entities under common control is no less obviously an abuse of process.

Consideration 49 The public allegations of dishonesty against individuals (where two are public figures and one is a professional solicitor), the "headline" damages claim of $50 million, the manner in which the proposed proceedings were publicised before they were commenced, the lack of any genuine steps taken by the applicant to resolve the alleged dispute before commencing proceedings, contrary to its statutory obligations, and the commencement of these proceedings in these circumstances was a misuse of the Court's processes. 50 This conduct occurred at a time when the trial in the defamation proceeding was about to commence at which Mr McGowan and Mr Quigley would appear as witnesses and to which Mr McGowan was a party. Having regard to the sequence of events, one of the likely purposes of commencing the proceeding in the circumstances described was to seek to place pressure on these individuals and to attempt to distract them in the period immediately preceding this trial. By this conduct, the applicant sought to use the Court's processes as a weapon and to achieve a purpose other than that for which the proceedings are properly designed and exist. 51 As submitted by Mr Thomson SC S-G (which submissions I accept): … there is a peculiarity about the type of proceedings in this instance where you have public officers, and it's the making of the allegations and the publicity of the allegations that, in and of itself, has the prejudicial effect. As your Honour will see, the blaze of publicity in which these [proceedings] were commenced, and the statements that were made on the radio without any proceedings actually having been commenced, does in and of itself have that peculiar effect. And that is why the court should be astute to ensure that claims made in it don't have an undue prejudicial effect just because they are made. … A $50 million claim personally against somebody for doing their job; the Premier, the Attorney-General, the State Solicitor, that is a serious amount of claim. It has a deterrent effect, you would think, if you paid any attention to it, upon the carrying out of your duties in the public interest. It is weaponising litigation. And if you're going to use litigation as a weapon, you do it properly and you think through the claim. 52 Further, the commencement of these proceedings which made the same or similar allegations concerning the enactment of the Amending Act as were being ventilated in the defamation proceeding to which Mr Palmer (the applicant's sole director) was a party, and then to reject an opportunity offered by this Court to have those common factual issues resolved expeditiously by one judge, was a misuse of the Court's processes. Such conduct is a waste of public resources and it constitutes "tactical manoeuvring that impedes the 'just, quick and efficient' resolution of litigation": UBS AG at [45]. By this conduct, the applicant breached its statutory obligation pursuant to s 37N Federal Court of Australia Act 1976 (Cth) to conduct this proceeding in a way that is consistent with the overarching purpose. 53 As the Notice of Discontinuance was filed within a matter of hours of the approach being made by the Associate to Lee J to the applicant, the inescapable inference is that this was done for the purpose of avoiding the resolution by Lee J of the common factual allegations concerning the Amending Act. Such an inference arises from the events described above which concern the interactions between Lee J, his Honour's Associate, Mr Palmer's solicitors and the applicant's solicitors. And no evidence was adduced by the applicant to provide any alternative explanation. 54 By filing the Notice of Discontinuance, the applicant has preserved its ability to bring another proceeding against the respondents in relation to the same, or substantially the same, causes of action as contained in the statement of claim, having regard to r 26.14. In all of the circumstances, it knew that this would be the consequence of discontinuing in this way and it intended to retain that ability. 55 By commencing and then discontinuing these proceedings in the way that it did, the applicant obtained the collateral advantage of making serious and well publicised allegations against the respondents, including as to their honesty, without any opportunity for the respondents to refute or deal with those allegations in any way and to obtain public vindication. 56 It follows that, had the applicant required leave to file the Notice of Discontinuance, it would not have been granted unconditionally: Castanho at 572. 57 For all of these reasons, the filing of the Notice of Discontinuance was an abuse of the processes of this Court. 58 Accordingly, the Notice of Discontinuance will be struck out.

Whether leave should be granted to the applicant to file a notice of discontinuance on the condition sought by the respondents 59 Rule 26.12(2)(c) enables a party to file a notice of discontinuance with leave of the Court at any time. In this regard, it is relevant to observe that Note 2 to r 26.12(2) identifies that the Court may give leave to discontinue subject to conditions. Express reference is made to r 1.33, which rule provides that the Court may make an order subject to any conditions the Court considers appropriate. 60 However, in this case, the applicant does not require leave to file a notice of discontinuance and nor has leave been sought by it. For that reason, an order will not be made granting leave to the applicant to file a notice of discontinuance. 61 Instead and by reason of its conduct to date in this proceeding, the applicant should be prevented from filing a further notice of discontinuance on an unconditional basis. Rather, any such notice of discontinuance should be subject to a condition of a similar kind to that sought by the respondents, at least insofar as it relates to them and to the applicant. To that end, the Court may make an order that is inconsistent with r 26.12 pursuant to r 1.35, which is what will be done in this case. 62 The condition which will be imposed is not an absolute restraint on proceedings being commenced. 63 Rather, it will prevent proceedings being commenced in this Court by the applicant against any of the respondents in relation to the Amending Act without leave first being obtained. 64 The imposition of such a condition enables the Court to exercise control over its own processes in relation to a litigant which has abused them in the past. 65 The Court should be astute to ensure that the misuse of the Court's processes by the applicant is not repeated in any future proceedings and the proposed condition will enable the Court to ensure that it does not. 66 Contrary to the form of order proposed by the respondents, the condition will not extend to Mr Palmer personally and any entity "controlled" by Mr Palmer for the following reasons. 67 First, Mr Palmer and any other entities associated with him were not joined as parties to this application and an order should not be made which affects their interests in their absence. While it is correct to say that Mr Palmer was no doubt aware of the application, and that the order was sought against him, he was not served personally and did not appear. None of Mr Palmer's other entities were served either. 68 Second, the other entities which could be said to be "controlled" by Mr Palmer and which would be caught by this proposed order were not identified by name and, because of its wording, the scope of the order is uncertain and could give rise to further disputes. For example, would an entity controlled by Mr Palmer include a company of which Mr Palmer was only one of four directors (such as Mineralogy Pty Ltd)? Would it include a company over which Mr Palmer exerted influence but of which he was neither a director nor shareholder? 69 A further modification to the condition sought by the first to third respondents is that the condition will only relate to proceedings being commenced against them by the applicant. The basis upon which the first to third respondents could seek a condition that leave be required by the applicant to bring proceedings against someone else besides themselves was not explained and is not apparent. 70 One of the matters raised by the respondents related to asserted defects in the statement of claim. Although it has not been necessary to address those alleged defects in these reasons, that matter can be revisited at a future time in the event that these proceedings are not discontinued by the applicant.

Whether costs should be awarded on an indemnity basis 71 The next question is whether the respondents should have their costs of the proceedings on an indemnity basis. 72 The Costs Practice Note (GPN-Costs) at [3.13] states as follows: The purpose of a costs order is to compensate a successful party rather than punish an unsuccessful party. However, the Court will consider the appropriateness of the making of a special costs order in circumstances which may warrant it, including where parties have failed to comply with their pre-litigation "genuine steps" obligations, where the "overarching purpose" duty has not been met, where parties engage in an abuse of process, raise unmeritorious arguments before the Court or otherwise conduct themselves inappropriately in the litigation. (footnotes omitted) 73 In this case, the applicant did not comply with its "overarching purpose" duty, has engaged in an abuse of the Court's processes and has otherwise conducted itself inappropriately in this litigation. 74 It is noteworthy that the applicant (by its solicitors) offered to pay the respondents' costs of the proceedings on an indemnity basis on 15 March 2022, which was only nine days before the Notice of Discontinuance was filed. 75 However, as the proceedings have now been reinstated and are yet to be discontinued, it is not appropriate to order that the applicant pay the costs of the proceedings. 76 Instead, it is appropriate to order that the applicant pay the respondents' costs of the proceedings to the date of this judgment on an indemnity basis: Anchorage Capital Partners Pty Limited v ACPA Pty Ltd (No 2) [2018] FCAFC 112, [5] (Nicholas, Yates and Beach JJ); Colgate-Palmolive v Cussons Pty Limited [1993] FCA 801; (1993) 46 FCR 225, 233-234.

Conclusion 77 For these reasons, the following orders will be made: (1) The Notice of Discontinuance filed by the applicant on 24 March 2022 is struck out. (2) The applicant may only file a notice of discontinuance of these proceedings on the condition that it is not permitted to commence further proceedings in the Federal Court of Australia against any of the respondents which make allegations relating to the passing of the Iron Ore Processing (Mineralogy Pty Ltd) Agreement Amendment Act 2020 (WA) without first obtaining leave of the Court. (3) The applicant pay the respondents' costs of and incidental to this proceeding up to and including 12 August 2022 on an indemnity basis. I certify that the preceding seventy-seven (77) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Downes.

SCHEDULE OF PARTIES NSD 54 of 2022 Respondents Fourth Respondent: NICHOLAS EGAN

Iron Ore Processing (Mineralogy Pty Ltd) Agreement Amendment Act 2020(WA)

Part IVB Federal Court of Australia Act 1976(Cth)

Court of Australia Act 1976(Cth)

Federal Court Rules 2011(Cth)rr 1.33, 1.35, 26.12, 26.14

NACU of 2001 v Minister for Immigration & Multicultural & Indigenous Affairs [2004] FCA 1444 Packer v Meagher [1984] 3 NSWLR 486 Palmer v McGowan (No 2) (2022) 398 ALR 524; [2022] FCA 32 Palmer v McGowan (No 5) [2022] FCA 893 UBS AG v Tyne (2018) 265 CLR 77; [2018] HCA 45 Wool International v Sedgwick Limited (No 2) [1997] FCA 709

International Minerals Pty Ltd v State of Western Australia

At a glance

Court

Decision date

Before

Source

Judgment (9 paragraphs)

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Legislation Cited (7)

Cases Cited (21)