MINERALOGY PTY LTD -v- SINO IRON PTY LTD [2020] WASC 40 (13 February 2020)

MINERALOGY PTY LTD -v- SINO IRON PTY LTD [2020] WASC 40 (13 February 2020) - WASC 2020 case summary — Zoe

[27]

The present action was commenced by the first and second plaintiffs ('Mineralogy' and 'Mr Palmer' respectively) by writ of summons indorsed with a statement of claim, on 11 December 2018 as against the defendants ('CITIC defendants').
I am currently dealing with the CITIC defendants' interlocutory application, made by their chamber summons filed 23 January 2019.
The primary question which arises is whether or not the whole action of these plaintiffs ought be stayed as an abuse of process of the court ‑ pursuant to O 20 r 19 of the Rules of the Supreme Court 1971 (WA) (RSC), or should otherwise be stayed in the court's inherent jurisdiction to constrain abuses of its process. An alternative, lesser, challenge also raised by the CITIC defendants' application as against Mineralogy is whether the action should be barred from proceeding any further, under an engagement of principles commonly referred to as an Anshun estoppel: see Port of Melbourne Authority v Anshun Pty Ltd [1981] HCA 45; (1981) 147 CLR 589. Related minor challenges are also raised by the plaintiffs.
The basis of the CITIC defendants' application and the contended abuse of process challenge is put against the plaintiffs' claim seeking to recover a substantial liquidated sum said to be contractually payable to Mineralogy by the CITIC defendants. These payments are said to be due by reason of an engagement of a written payment promise to Mineralogy made under cl 6.3 of two Mining Right and Lease Agreements ('MRSLAs'). These MRSLAs were entered respectively as between Mineralogy and each of the first defendant ('Sino Iron') and second defendant ('Korean Steel'), with each such MRSLA agreement made on 21 March 2006.
A previous 2017 decision that I delivered after a trial between these parties conducted in a separate proceeding CIV 1808 of 2013, has considered key obligation provisions within the same two MRSLA agreements. But that was all then litigated in a context of different MRSLA payment claim issues pursued then by Mineralogy against the same defendants. Specifically that trial concerned cl 8.2 of the MRSLAs over, essentially, the disputed interpretation of a term in each MRSLA that promised a royalty payment to Mineralogy of a 'Royalty Component B' ('RCB') ('RCB claim').
What was a problematically assembled royalty payment formula found within the MRSLA's definition of cl 8.2(a) needed to be evaluated at that trial as to its correct meaning ‑ to address the proper calculation of the level of royalty monies to be paid to Mineralogy by either Sino Iron or Korean Steel under each MRSLA agreement, termed the 'Mineralogy Royalty' (see post trial reasons for decision in Mineralogy Pty Ltd v Sino Iron Pty Ltd [No 16] [2017] WASC 340 (Mineralogy [No 16]) delivered 24 November 2017 and, later essentially, constructionally affirmed on appeal as Sino Iron Pty Ltd v Mineralogy Pty Ltd [2019] WASCA 80). But the present litigation raises different questions as I will attempt to explain.

[35]

Mr Palmer was not a covenanting party to the FCD. However, he is expressly named within a clause of the FCD as being an express object of CITIC Ltd's guarantee and indemnification promises as made to Mineralogy - as regards any loss or damage that Mr Palmer might suffer personally and arising by reason of a failure by Sino Iron or Korean Steel to perform their promises made under Project Agreements, (including thereby the MRSLAs). Privity issues aside, as regards the FCD, Mr Palmer now claims personal losses beyond the claims by Mineralogy.
So in the present action, Mr Palmer, who is for all intents and purposes clearly the controlling mind and, effectively, the alter ego of the corporation Mineralogy, attempts to advance his own personal claims against CITIC Ltd. That looks structurally to be an attempted fallback position, lest it ever be concluded that Mineralogy's present action is assessed (as the CITIC defendants now do so strongly submit) to be an abuse of the court's process, or if Mineralogy's claim is assessed as being barred by reason of an Anshun estoppel applicable against Mineralogy.
Mr Palmer's personal claim as currently pleaded, was verbally clarified during the course of oral arguments by his counsel at the hearing of this application (see ts 92 - 94). So clarified, it is to be more properly viewed as a claim pursued against CITIC Ltd 'in the alternative'. Its essence can be gleaned from the plaintiffs' statement of claim - pars 73(a), (d), (e) and (f).
So understood, Mr Palmer's personal claim proceeds on a basis that if by reason of an adverse conclusion reached against Mineralogy in this action, resulting in it being found to be precluded from successfully prosecuting this action, the MRP money claim, then as a result he would be personally deprived of Mineralogy's chose in action. Hence, for such adversely assumed circumstances, Mr Palmer argues that Mineralogy's (share) value would decline by the amount equivalent to the (lost) value to him of Mineralogy's (assumed as stayed or barred) chose of action seeking the MRP money under cl 6.3(b) MRSLA.
Critically, by pars 73(e) and (f) of the statement of claim, Mr Palmer contends his own loss as being:

[38]

So seen, Mr Palmer's contended personal cause of action in respect of which he then seeks an indemnification from CITIC Ltd under cl 11.5(c) of the FCD (see par 27 and par 28 of the statement of claim), is for his personal loss incurred by reason of a decline in the value of the shares he holds in Mineralogy - upon Mineralogy's loss of its presently advanced chose of action, due either to the application of abuse of process, or by Anshun estoppel principles.
So, Mr Palmer presently seeks for himself what is referred to by some case authorities, as a shareholder's 'reflective loss' as regards a diminished value of Mr Palmer's shares as held in the Mineralogy corporate entity that has sustained the primary loss. Furthermore, Mr Palmer also contends that, in such circumstances, the indemnification covenant of the FCD expressed in his favour by CITIC Ltd towards his personal losses, is thereupon engaged.
Again, that is all said for circumstances where Mr Palmer's personal loss is said to arise by reason of Mineralogy being (assumed as) found to have engaged in the abuse of process of this court, or upon Mineralogy otherwise being barred by an application of Anshun estoppel principles against proceeding further with its MRSLA cl 6.2(b) money claims against Sino Iron, Korean Steel and CITIC Ltd in this action.
It might be observed immediately that there is a certain novelty to the FCD claim for a personal loss suffered by Mr Palmer, upon the adverse circumstances of an ascertained abuse of process or Anshun estoppel found as against the corporation he controls, Mineralogy.
For the purpose of evaluating the present application it is also necessary to record that the current action, CIV 3129 of 2018, is at least the fourth action run or begun out of this court by Mineralogy (albeit only the first advanced towards the ramifications of cl 6.3(b) of the MRSLAs by Mr Palmer) in respect of which a MRP money claim seeking liquidated amounts said to be due to Mineralogy pursuant to cl 6.3(b) of each MRSLA has been pursued against the first, second and third defendants.
I next turn to address what is a somewhat cluttered prior litigation background to the present application as regards the MRSLAs, Mineralogy, Mr Palmer the CITIC defendants and cl 6.3(b).

[42]

But there soon followed again issued out of this court another action by Mineralogy. This time it was CIV 3166 of 2017 and pursuing again, the very same MRP money claims against Sino Iron, Korean Steel and CITIC Ltd. Mineralogy commenced this further action by its writ of summons, with an endorsed statement of claim, on 21 December 2017.
Akin to the now discontinued action that had been CIV 3011 of 2017, CIV 3166 of 2017 sought a payment to Mineralogy by Sino Iron and Korean Steel of $US97,802,035, plus default interest. Again this was claimed by reason of cl 6.3 of each MRSLA. Similarly to before, Mineralogy also sought that CITIC Ltd pay it $US195,604,070, again claimed by Mineralogy under the FCD guarantee and indemnification provisions, plus default interest.
Unlike the immediate predecessor, this Mineralogy action, CIV 3166 of 2017, lived long enough to be referred for case management. It was entered into my CMC List, on 16 January 2018.
On 31 January 2018 there was an application by the defendants under chamber summons, seeking a stay and barring relief akin to that presently sought in the current Mineralogy action.
On 16 February 2018, Mineralogy applied for leave in CIV 3166 of 2017 to add Mr Clive Palmer as second defendant and also to add Sino Iron Holdings Pty Ltd ('Sino Iron Holdings') as a fourth defendant in that action. But leave to that end was opposed by the defendants.
A minute of proposed amended statement of claim by the proposed plaintiffs contended that Mr Palmer was at all material times the person who was the ultimate beneficial owner of all the shares in Mineralogy. Sino Iron Holdings was sought to be added as an extra defendant on the basis that it was, in effect, the parent corporation of the first defendant, Sino Iron. Moreover, a pleaded claim of unconscionable conduct was now sought to be added. That may be seen from between par 55 and par 83 of the submitted minute of amended statement of claim by Mineralogy.
By par 84 through par 85 of that proposed amended statement of claim, Mr Palmer looked to be pursuing an indemnification claim against CITIC Ltd - in terms akin to that as is now pursued by him in the current action.
On 26 February 2018, I programmed by directions, a hearing of what were then the extra plaintiff and defendant contested joinder applications in respect of Mr Palmer and Sino Iron Holdings, as well as the hearing of the defendants' abuse of process strikeout application which was advanced against the whole action by the defendant's then chamber summons application of 31 January 2018. I duly fixed a special appointment hearing for 26 June 2018.
Correlative directions were also issued then in terms of the parties' to be exchanged rival affidavit evidence and their rival written submissions relied upon at the hearing of all those applications, under my orders of 26 February 2018.
However, it came to pass that on 8 May 2018, Mineralogy now filed a notice advising it was wholly discontinuing its CIV 3166 of 2017 as against all defendants. Given the defendants had not by then filed their pleaded defences, the pleadings were not closed. Hence, leave to discontinue was not then required by Mineralogy. By a chamber summons of 7 June 2018, the defendants made application now seeking indemnity costs orders against Mineralogy, alternatively for special costs orders, pursuant to s 280 of the Legal Profession Act 2008 (WA) as regards defendants' costs incurred in resisting the now discontinued proceedings to the point of their unilateral discontinuance by Mineralogy. I listed the defendants' costs application for a hearing on 20 September 2018.
The defendants' written submissions pursuing those indemnity and/costs or special costs orders were filed on 6 August 2018. Mineralogy, responded opposing those costs orders, by its written submissions of 27 August 2018.
On 6 September 2018, upon the parties' consensual requests, I adjourned the hearing of the application seeking special costs orders. The defendants' unresolved application for indemnity costs (or for special costs orders) has not otherwise been pursued.
Hence, Mineralogy's further action CIV 3166 of 2017, stands as wholly discontinued by Mineralogy. There is still an unresolved costs orders issue over costs orders sought by the defendants against Mineralogy, with indemnity costs orders actively opposed.

[45]

For the present application of the defendants there is an overwhelming amount of evidentiary material, recalling countless past pleadings, directions hearings, orders, applications and determinations all re‑assembled and relied upon again for the purposes of advancing the present application. Having been case manager of all of the Mineralogy related litigation since October 2016, I have been a personal witness to the most recent documents and the procedural history that has been assembled again concerning the historical events around all these actions. Revisiting them over again for the purpose of evaluating the present application of the defendants has not enhanced the quality of the experience.
The basic underlying facts, however, need to be meticulously assembled and redigested yet again in order to reliably evaluate in a holistic context the present application which, as the plaintiffs rightly point out, if acceded to, is an exercise of an extreme remedy as against them.
It is also true that success for the CITIC defendant applicants upon the present application would deny the plaintiffs from obtaining a determination 'on the merits' of their MRSLA grounded MRP money claims. They, of course, have not yet ever been finally evaluated by a court on their merits - a consideration I recognise and must weigh in the overall balance of considerations as against granting the present permanent stay relief as is sought by the defendants.
At the outset, then, I need to collect and identify the extensive materials that were read and relied upon by each of the protagonists whilst pursuing the present application, and in its resistance.
For the CITIC defendants, they read and rely upon several affidavits sworn by a partner of the law firm of longstanding record for those parties. So read are three affidavits by Ian Peter Scott O'Donahoo; the first of these is sworn 22 January 2019 (comprising 14 volumes and 2,840 pages), the second is sworn 2 May 2019 (95 pages) and the third is sworn 12 June 2019 (321 pages).
Resisting the CITIC defendants' applications, the plaintiffs read and rely on an affidavit of Clive Frederick Palmer affirmed 8 May 2019 (249 pages). In addition to Mr Palmer's affidavit there is an affidavit made by Kane Christopher Jones, Mineralogy's current lawyer of record, sworn 18 September 2019 (94 pages).
In furtherance of the present application, each side filed extensive written submissions. To that end I hold:

[83]

Returning to the question to be determined, there now arises a need for the application of those related abuse of process principles to the underlying facts. To that end, the next sections of these reasons seek to assemble chronologically something of a summary of more significant facts and events which have occurred as regards the pursuit in this court of the MRSLA cl 6.3(b) MRP money claim by Mineralogy over time since 2013. Plainly, it is not simply feasible to canvass in minute detail all nuances of all events unfolding since the commencement of CIV 1808 of 2013 (then out of the Supreme Court of New South Wales) before that action was remitted for hearing under the national cross‑vesting regime legislation to this court.
Nor do I propose to re-traverse the subject of what is now extensively contained across multiple reasons for decision as rendered in the saga of civil litigation between all these parties in this court, including Mineralogy Pty Ltd v Sino Iron Pty Ltd [No 13] [2016] WASC 403 (Mineralogy [No 13]), Mineralogy Pty Ltd v Sino Iron Pty Ltd [No 14] [2017] WASC 17 (Mineralogy [No 14]), my primary reasons following civil trial in Mineralogy [No 16] and my aftermath decision, Mineralogy Pty Ltd v Sino Iron Pty Ltd [No 17] [2018] WASC 8 (Mineralogy [No 17]). I refer as well to the further reasons of Quinlan CJ in Mineralogy Pty Ltd v Sino Iron Pty Ltd [No 18] [2018] WASC 307 (Mineralogy [No 18]).
An early chronology of the proceedings then, to August 2014, can be usefully found within Edelman J's reasons published as Mineralogy Pty Ltd v Sino Iron Pty Ltd [No 4] [2014] WASC 282 (Mineralogy [No 4]) determined on the papers and delivered on 5 August 2014. In the subsequent reasons of Tottle J in Mineralogy Pty Ltd v Sino Iron Pty Ltd [No 8] [2015] WASC 473 (Mineralogy [No 8]), his Honour had adopted that chronology of events.
Under the next section of these reasons, I will seek to assemble a working body of chronological underlying facts. To that end, I have worked heavily from the chronology of events within the defendants' written outline of submissions of 13 June 2019 - which can be seen to refer to the source documents, most of which can in turn be located in Mr O'Donahoo's first affidavit. I did not discern at the hearing of this present application that any of the assembled background facts by the defendants were in serious dispute. Rather, the dispute is over what emerges from them all.

[84]

On 18 March 2013, Mineralogy commenced proceedings out of the Supreme Court of New South Wales (NSW proceeding SC 2013/82818) seeking then, amongst other things, payment of 'minimum production' royalties claimed as due under cl 6.3 of the MRSLAs and, as well, for orders in respect of the guarantee provided by CITIC of the payment obligations of its submissions to Mineralogy.
On 30 April 2013, New South Wales civil proceeding SC 2013/82818 was transferred to the Supreme Court of Western Australia and under the national cross-vesting regime. Here, it was then re-numbered in this court as CIV 1808 of 2013.
Under an Amended Statement of Claim pleading of 3 June 2013 filed in CIV 1808 of 2013, and then by a Further Amended Statement of Claim of 14 August 2013, Mineralogy claimed from the defendants payment of 'minimum production' royalties, alleged to be due to Mineralogy, by reason of cl 6.3 of the MRSLAs. Mineralogy also sought then to recover those amounts from CITIC Ltd under a CITIC guarantee and a CITIC indemnity to Mineralogy.
On 2 December 2013, in CIV 1808 of 2013, Mineralogy filed a Further Amended Reply and Amended Defence to Amended Counterclaim, by which it then had pleaded that RCB was not capable of calculation. That was alleged on a basis that the MRSLAs were then terminated, by reason of alleged frustration of those agreements.
Also on 2 December 2013, Mineralogy in CIV 1808 of 2013 sought an urgent hearing, upon the issue of whether the MRSLAs were terminated by reason of frustration, as a preliminary matter to be listed for a single-day trial in December 2013.
On 4 December 2013, Edelman J refused Mineralogy's application seeking the urgent trial of preliminary issues, including upon whether the MRSLAs were frustrated by reason of RCB being incalculable.
On 10 December 2013, Mineralogy filed a Second Further Amended Statement of Claim. Under that iteration, Mineralogy now withdrew (ie, deleted) the former MRP money claims. Instead, Mineralogy now sought declarations to the effect that, inter alia, the MRSLAs had been frustrated.
By reference to the associate's record, the order 1 made by Edelman J on 20 March 2014 was this:

[86]

On 15 August 2014, Mineralogy filed a Third Further Amended Statement of Claim ('3FASOC'). The 3FASOC did not articulate any relief related to the former MRP money obligations arising under the MRSLAs. This pleading made no mention at all of cl 6.3 of the MRSLAs.
However, on 19 August 2015, Mineralogy now commenced a fresh civil proceeding out of this court which did include the earlier seen MRP money claims - CIV 2303 of 2015 (see POD‑58 at pages 2411 - 2422 of Mr O'Donahoo's first affidavit).
Within the new action, CIV 2303 of 2015, Mineralogy was plaintiff. Sino Iron was first defendant, Korean Steel second defendant, with CITIC Ltd named as third defendant. The writ displayed an accompanying statement of claim. I refer to pars 11 and 12 of a plea which, as against Sino Iron and then Korean Steel, is seen to refer to MRSLA cl 6.3(a) and cl 6.3 (b) within those defendants' respective MRSLA. Also seen was Mineralogy's assertion of a contended failure of Sino Iron and Korean Steel to produce not less than six million tonnes of Product (as defined) within seven years of each MRSLA being entered. Mineralogy sought $US98,298,000 against each of Sino Iron, see par 11(d), and Korean Steel, see par 12(d). As against CITIC Ltd, the FCD is seen pleaded at pars 13 and 14 of the statement of claim, in invoking cl 11.5 thereof. By par 15 it was pleaded CITIC Ltd was liable to pay to Mineralogy, by reason of cl 11.5 of the FCD, the same money amounts as were payable by Sino Iron and Korean Steel pursuant to cl 6.3(b) of the respective MRSLAs.
On 31 August 2015, Mineralogy now commenced a third civil proceeding in the Supreme Court of Western Australia, CIV 2368 of 2015, seeking various further relief I do not need to elaborate upon.
However, both those new 2015 actions CIV 2303 of 2015 and CIV 2368 of 2015 as commenced by Mineralogy, came to be permanently stayed, upon applications of the defendants, as abuses of process. Chaney J had made those orders under his Honour's reasons: see Mineralogy Pty Ltd v Sino Iron Pty Ltd [2015] WASC 454, 27 November 2015. Chaney J replaced Edelman J as the case manager of the Mineralogy litigation during 2015 (following the appointment of Edelman J to the Federal Court of Australia).
Chaney J's reasons of 27 November 2015 were delivered in both actions, CIV 2303 of 2015 and CIV 2368 of 2015. As mentioned, his Honour granted a permanent stay in both of those actions.
At [3] of his reasons, Chaney J identified Mineralogy's pleas within CIV 2303 of 2015 under cl 6.3(b) of the MRSLAs claim for the aggregate amount, then, of $US196,596,000. His Honour duly observed at [4] upon a counterclaim by the CITIC defendants raised in the earlier action, CIV 1808 of 2013:

[94]

At [30] Chaney J foreshadowed a future application by Mineralogy for leave to amend Mineralogy's pleading in that founding litigation of CIV 1808 of 2013 to reinclude the original MRP money claims claims. That, indeed, followed later in the piece by Mineralogy in a minute of a proposed amended pleading.
But stepping back somewhat in the chronology for the moment, at between August 2014 and May 2015, the parties exchanged correspondence and had made rival submissions at various interlocutory hearings - over whether there were issues in CIV 1808 of 2013 which were appropriate for a preliminary determination by the court. Mineralogy had by then made four applications seeking the determination of a preliminary issue during this period. One of those it abandoned. The other three were all dismissed by Chaney J on 28 May 2015.
Returning to late December 2015, now in the original action CIV 1808 of 2013, Mineralogy now filed its interlocutory application (to be heard urgently) by Tottle J (given Chaney J's commitments at that time to another trial) and seeking mandatory injunctive payment relief on an interlocutory basis from the defendants. Orders were now being sought by Mineralogy against the defendants for an immediate payment of $US48 million that was alleged then by Mineralogy to be due to it in respect of unpaid RCB funds. A useful conspectus of the procedural background to the litigation to that point is found in Tottle J's reasons: see Mineralogy [No 8] [19] - [36].
Tottle J urgently heard but ultimately refused Mineralogy's interlocutory application for mandatory part payment orders, essentially concluding that although there was then a seriously arguable case for payment to Mineralogy on its RCB claim, that the balance of convenience was then against the grant of pre‑trial mandatory injunctive orders requiring payments as then were sought by Mineralogy: see Mineralogy [No 4] [102] - [108].
Tottle J's refusal decision, however, was then appealed by Mineralogy to the Court of Appeal of Western Australia. The appeal was urgently heard on 24 March 2016, with reasons delivered on 27 June 2016 and allowing Mineralogy's appeal. See Mineralogy Pty Ltd v Sino Iron Pty Ltd [2016] WASCA 105 (McLure P, Newnes JA, Corboy J). Hence, Mineralogy's application seeking the interlocutory mandatory relief compelling the payment of RCB funds then said to be due under the MRSLAs was remitted back for a full rehearing to the case manager (Chaney J).
At [1] McLure P agreed with the reasons of Newnes JA. Nevertheless, in her own brief reasons, the learned former President observed upon the lack of any assessment as to the strength of Mineralogy's as established arguable prima facie case seeking injunctive relief by way of a pre-trial ordered payment of RCB money [23]:

[102]

Like McLure P, Newnes JA also said that the appropriate course was to remit Mineralogy's interlocutory payment injunction application to be reheard [115]. Corboy J agreed with both Newnes JA and McLure P [117].
Mineralogy's then 3FASOC (which had not included the MRP money claims) was still on foot at the time of respective decisions by Tottle J and by that 2016 Court of Appeal.
But on 1 April 2016, Mineralogy had filed a minute of proposed Fourth Further Amended Statement of Claim in CIV 1808 of 2013 ('4FASOC') by which it again (post Chaney J's abuse of process decision on the two 2015 actions) now sought to re-agitate the same MRP money claims. But Mineralogy needed the leave of the court to make those amendments, given orders to that effect as were earlier made by Edelman J.
Due to an unforeseen conflict issue that emerged for Chaney J (see his Honour's reasons Mineralogy Pty Ltd v Sino Iron Pty Ltd [No 12] [2016] WASC 335) and his subsequent voluntary recusal, CIV 1880 of 2013, duly arrived on my docket for case management. I then, in accord with the directions of the 2016 Court of Appeal issued in allowing Mineralogy's successful appeal, reheard the mandatory interlocutory injunction arguments seeking to compel the RCB part payments on 27 and 28 October 2016. I delivered my reasons on 13 December 2016: see Mineralogy [No 13]. In light of the 2016 Court of Appeal's reasons as expressed whilst upholding that appeal, an evaluation of the strength of Mineralogy's prima facie case was a central focus of that interlocutory rehearing of Mineralogy's application to compel by injunction pre-trial payment of RCB money by the defendants.
Before me, at the full remitted hearing no plaintiff or defendant party ever submitted either on paper or verbally by respective senior counsel that this court, as a court of equity, lacked the power to grant Mineralogy's as claimed interlocutory royalty payment relief. Of course, were that so, there would be no point at all in the 2016 Court of Appeal ordering a rehearing and a re-evaluating the strength of Mineralogy's prima facie case upon its injunction application. Absent the power or jurisdiction to grant such relief, such an exercise would be pointless.
As events transpired, the interlocutory rehearing exercise as remitted and conducted by me was, indeed, completely pointless: see Sino Iron Pty Ltd v Mineralogy Pty Ltd [No 2] [2017] WASCA 76 (delivered 20 April 2017). By those reasons, a differently constituted 2017 Court of Appeal now determined, in effect, that there was a lack of jurisdiction to grant the interlocutory payment relief that Mineralogy was seeking ‑ an obstacle issue that looks only to have become live before the 2017 Court of Appeal following my determination favouring Mineralogy in Mineralogy [No 13].
I must now briefly divert to address some inter parties communications that arose around the publication of my reasons in Mineralogy [No 13]. On 1 November 2016, Mineralogy had written to lawyers Allens (who then acted and continues to act for all CITIC defendants in CIV 1808 of 2013) stating:

[125]

That very day (24 November 2017) I delivered those trial reasons, Mineralogy now filed a new writ out of this court indorsed with a statement of claim ostensibly commencing a fresh action and pursuing the former MRP money claim under a new proceeding, CIV 3011 of 2017.
Five days later, on 28 November 2017, Mineralogy, as already mentioned, filed a unilateral notice of discontinuance of CIV 3011 of 2017.
On 21 December 2017, Mineralogy filed yet another writ indorsed in this court with a statement of claim. This was proceeding CIV 3166 of 2017 which, as seen, re‑agitated the MRP money claim of Mineralogy.
On 22 January 2018 Allens (again acting for the CITIC defendants) wrote to Mineralogy, inviting it to discontinue CIV 3166 of 2017, failing which it was stated that Sino Iron, Korean Steel and CITIC Ltd would apply to strike out, permanently stay or dismiss the new 2017 proceeding. Allens also invited a conferral in relation to the defendants' as proposed application: see POD-71 of Mr O'Donahoo's first affidavit.
On 30 January 2018, Mineralogy responded, asserting Mineralogy was fully entitled to pursue the MRP money claim under CIV 3166 of 2017 and further advising Mineralogy intended to amend its pleadings to join Mr Palmer as co‑plaintiff to the action and also to add to the action further claims by Mineralogy and by Mr Palmer, said to arise under the FCD.
On 31 January 2018, Sino Iron, Korean Steel and CITIC Ltd filed an application to strike out, stay or dismiss CIV 3166 of 2017, as an abuse of process of the court.
On 21 February 2018, Mineralogy applied by its chamber summons to join Mr Palmer as the second plaintiff in CIV 3166 of 2017 and to join Sino Iron Holdings Pty Ltd as the fourth defendant in CIV 3166 of 2017 and, as well, to amend its pleadings to that end.
On 26 February 2018, I issued some programming directions in CIV 3166 of 2017 towards a determination hearing of Sino Iron, Korean Steel and CITIC Ltd's abuse of process and strike out application, and for Mineralogy's joinder applications.
During March and April 2018, the parties in CIV 3166 of 2017 advanced various steps under those programming directions towards the hearing.
But on 14 April 2018, Mineralogy wrote to Allens giving notice that it intended to discontinue CIV 3166 of 2017: see POD-84 of Mr O'Donahoo's first affidavit.
On 8 May 2018, Mineralogy filed and served its notice of discontinuance of CIV 3166 of 2017 (leave to discontinue not being needed).
However, seven months on, at 11 December 2018, Mineralogy duly initiated the present civil proceeding in this court (CIV 3129 of 2018) and advancing the same MRP money claim again.

[129]

For the present application I need to refer to Clive Frederick Palmer's affidavit affirmed 8 May 2019 and filed 23 May 2019.
Of course, as the CITIC defendants point out, what Mr Palmer now relates (as I will discuss) be seen and weighed holistically, against what Mr Palmer has also said earlier, under some of his prior affidavits.
Of particular importance to this exercise is the period between December 2016 and January 2017. That was when Mineralogy was seeking trial dates for an urgent trial of its RCB claim in CIV 1808 of 2013. At that time a trial was set down for a two week hearing in June 2017. My trial determination was Mineralogy [No 16].
Out of Mr Palmer's 8 May 2019 affidavit, I need to extract what he has said there, both on his own behalf as well as on behalf of Mineralogy, commencing at par 4 and continuing. Since this is a lengthy extract, required for proper context, I have at places highlighted in bold certain statements made by Mr Palmer, particularly concerning Mineralogy's 'undertaking' proffered as regards not pursuing its excised MRP claims in CIV 1808 of 2013.
Mr Palmer says:
1. On 7 December 2015 Mineralogy sought, amongst other things, a mandatory interlocutory injunction compelling the CITIC Parties to pay to Mineralogy the sum of US$48 million in respect of unpaid royalties.
2. Tottle J delivered judgment on the application on the same day, refusing the application (Mineralogy Pty Ltd v Sino Iron Pty Ltd [No. 8] [2015] WASC 473).
3. Mineralogy successfully appealed from the decision of Tottle J. The Court of Appeal delivered judgment on 27 June 2016, allowed the appeal, set aside the decision of Tottle J and remitted Mineralogy's application for a mandatory injunction to the Supreme Court of Western Australia (Mineralogy Pty Ltd v Sino Iron Pty Ltd [2016] WASCA 105).
4. The remitted application for a mandatory injunction was heard by Kenneth Martin J on 27 and 28 October 2016. At that time, Mineralogy sought, amongst other things, a mandatory interlocutory injunction compelling the CITIC Parties to pay to Mineralogy approximately US$80 million.
5. The increase in the amount sought, from US$48 million to US$80 million, reflected the unpaid royalties arising from the CITIC Parties' mining operations for the period from the fourth quarter of 2015 to the second quarter of 2016 inclusive.
6. ...
7. His Honour Kenneth Martin J delivered judgment in respect of the remitted application for a mandatory injunction on 13 December 2016 (Mineralogy Pty Ltd v Sino Iron Pty Ltd [No. 13] [2016] WASC 403 (Injunction Judgment)).

[222]

The essence of Mineralogy and Mr Palmer's submission put against abuse of process is that whilst Mineralogy and Mr Palmer once did offer the inter partes undertakings to the CITIC defendants to unequivocally withdraw for all time all the excised causes of action and claims, as were then being taken out by excisional amendments from Mineralogy's proposed 5FASOC in CIV 1808 of 2013, that these inter partes undertakings were not then accepted by the defendants, who wanted more. Instead, Mineralogy says its undertaking was specifically rejected by the CITIC defendants and so, therefore, lapsed, in effect, and became redundant.
Augmenting that 'lapse' submission is a contention of Mineralogy and by Mr Palmer that after the directions hearing on 20 January 2017 the CITIC defendants effectively proceeded to a June 2017 trial under circumstances where Mineralogy by senior counsel had at that January 2017 directions hearing explicitly declined to provide wider undertakings to the court to not ever pursue Mineralogy's withdrawn claims in future. That stance had given rise to senior counsel for the CITIC defendants at that hearing to ask the court to impose a condition that Mineralogy only be granted leave to amend in terms of the proposed 5FASOC, on the express condition that Mineralogy be explicitly barred from ever proceeding in future upon any such excised claims (such as the MRP money claim) as had been once pleaded by Mineralogy in CIV 1808 of 2013.
Although such a condition was indeed raised as between myself and senior counsel for the CITIC defendants, in the end, I had imposed no such condition upon the grant of leave to amend - but on the basis that I thought it was unnecessary.
It is now contended by Mineralogy and Mr Palmer, effectively, that the end result was that there remained an unlimited scope for Mineralogy in future to pursue again such as excised claims, such as the MRP money claim, in the future by fresh litigation, as it sought fit. As background to my pre-trial orders as I had then made, see my further interlocutory reasons, Mineralogy [No 14].
As already seen, Mineralogy's short-lived action of four days duration pursuing the MRP money claim again (namely, CIV 3011 of 2017) was commenced on the very day my trial reasons in Mineralogy [No 16] were made available to the parties. Discontinuance ensued, according to Mr Palmer for Mineralogy, because on his reading those trial result reasons Mr Palmer first considered that 'the proper course was to refer the dispute concerning the Minimum Royal claim for expert determination under the MRSLAs': see Mineralogy's written submissions at par 57(a), referring to Mr Palmer's 8 May 2019 affidavit at pars 68 - 73. But later he changed his view about that.
Mineralogy's next action again pursuing the MRP money claim, CIV 3166 of 2017, was commenced on 21 December 2017. That came about, it is explained, because, upon further consideration of the trial reasons, Mr Palmer now 'considered the Minimum Royalty claim was not one of the categories of dispute identified in the MRSLAs and being referrable to expert determination': see Mineralogy's written submissions par 57(b).
Action CIV 3166 of 2017, of course, was challenged by the CITIC defendants in a similar vein to the present application - as an abuse of process. An interlocutory application of the defendants to dismiss that action as an abuse of process had been set down for a hearing before me, with the usual associated directions for the exchanges of evidence and of written submissions beforehand. But this action was discontinued. That, it is now explained, was upon the decision taken to add Mr Palmer as a co‑plaintiff to the proceedings - which was also opposed by the defendants - and because (see Mineralogy's written submissions par 57(b)):

[229]

Mineralogy and Mr Palmer also seek to distinguish the majority approach in UBS AG v Tyne, on the basis that here, unlike in that litigation, it is said that Mr Palmer has provided a full explanation for the decision to discontinue. It is said Mr Palmer's explanation not only addresses his and Mineralogy's interests as persons who have discontinued, or been associated with the discontinuances of civil proceedings, but also explains why such conduct was actually said to be in the public interest towards, it is said, the timely and efficient administration of justice within CIV 1808 of 2013.
It is said further that Mr Palmer's reasonable explanation as given aligns with modern principles of proportionate and sensible case management (embodied in the local rules of court) and also with considerations towards an overall public interest in the efficient administration of civil justice.
Mineralogy and Mr Palmer point to the CITIC defendants' pleaded vast defence that had been raised against the cl 6.3(b) MRP money claim, as once framed in CIV 1808 of 2013. They say, and I would accept for the purposes of resolving this application, that it had 'raised a substantial factual controversy spanning 150 pages of pleading which alleged that the CITIC defendants were not obliged to pay the Minimum Royalty by reason of any delays (on their part): see Mineralogy's written submissions par 68(a).
Mineralogy and Mr Palmer also assert that irrespective of Mineralogy's (numerous) pleading fluctuations after the inception of CIV 1808 of 2013 (once it reached Western Australia from New South Wales) that the cl 6.3(b) MRP money claim was pleaded out under the leave of Chaney J within its 4FASOC. Earlier iterations of its pleadings are hence of limited relevance. That is said because it was '... in the interests of just, quick and efficient resolution of the dispute to amend the 4FASOC to focus the proceedings upon the RCB dispute': Mineralogy's written submissions par 68(b).
Mr Palmer and Mineralogy say further that by some contrast to the facts underlying UBS AG v Tyne, that presently there has been no 'serial discontinuing' of civil proceedings - so as to constitute an 'obvious example' of abuse of process in the context of the pursuit of 'substantially the same claim in serial proceedings'.
Mineralogy and Mr Palmer contend also that the current MRP money claim is not the same as the claim that was once pleaded in CIV 1808 of 2013: see Mineralogy's written submissions par 68(d). [The observation is strictly correct given to the extra presence of Mr Palmer as a co‑plaintiff and the presence of Sino Iron Holdings as a fourth defendant within the current action.]
Mr Palmer and Mineralogy then say that a narrowing of the claims that ultimately went to trial in CIV 1808 of 2013 was implemented by Mineralogy with the objective of achieving the early trial dates for the RCB dispute, in the interests of a just, quick and efficient resolution of that RCB dispute. But Mineralogy and Mr Palmer fulsomely reject that they ever sought to gain any form of tactical forensic advantage over the CITIC defendants by adopting that approach at the time: see Mineralogy's written submissions par 69(e).
Finally, Mineralogy and Mr Palmer contend that there will be no present vexation of the CITIC defendants by a pursuit of the current litigation under the abuse of court process principles as were applied in UBS AG v Tyne - which only relate, they submit, to the vexation of a defendant required to deal with civil claims that should have been resolved in earlier proceedings (invoking UBS AG v Tyne [58]). The proposition is not properly applied to Mineralogy and Mr Palmer's pursuit of the present litigation as the co-plaintiffs. They do not accept that the present MRP money claim as now pursued should or could have been conveniently resolved within the earlier action (ie, CIV 1808 of 2013) that went to a trial.
Mineralogy and Mr Palmer contend that the principles to be applied in considering whether an Anshun estoppel is established are also not met for present circumstances. Such a conclusion would only be reached in the clearest of cases, of which it is said that the present is not. They repeat their submissions essentially rebutting all suggestions of abuse of process as being equally applicable to rebut any suggestion of an application of Anshun estoppel against them.
Further submissions are provided concerning Mineralogy and Mr Palmer's respective guarantee and indemnity claims, invoking provisions of the FCD. It is contended that loss suffered by Mr Palmer is not merely reflective of the loss suffered by Mineralogy and is a loss personal to him. It is a loss that is said to be distinct and is distinctly recoverable from CITIC Ltd under the FCD and, while a unique cause of action, is not unarguable. At worst, the FCD claims raise a 'debatable question of law': see Mineralogy's written submissions par 96, referring there to my more recent observations in Palmer v CITIC Ltd [2019] WASC 14 [19], [121], [141] and [144].

[230]

I am of the end view that application of the abuse of process principles as recently applied in UBS AG v Tyne requires the present action by Mineralogy and Mr Palmer must, indeed, be evaluated as an abuse of the process of the court. As a result it must be permanently stayed, in my view.
As a matter of the everyday case management of CIV 1808 of 2013, which I case managed from October 2016 to its ultimate trial outcome, I observe that it would have been the easiest thing for Mineralogy, through highly competent senior counsel, over the period between December 2016 to January 2017, whilst then begging for the urgent trial hearing dates for that action, to deal with this issue explicitly. Mineralogy was then contemplating excision amendments to its then 4FASOC. Mineralogy could then have told the court, so instructed and openly, that Mineralogy was seeking to preserve for itself, so as to possibly revive at a later date if it thought fit, some or all of the civil causes of action it had previously pleaded out in CIV 1808 of 2013 seeking liquidated amounts against Sino Iron, Korean Steel and CITIC Ltd. That potentially was never said or even hinted at. An attempted express preservation of the MRP money claim then and, indeed, of an allied guarantee or indemnity under the FCD, were being taken off the table from CIV 1808 of 2013. Concern was being expressed then by the CITIC defendants about a future revival of such claims. If Mineralogy was not then abandoning these claims once and for all time, then something to that effect could and should surely have been said. It was not. That observation is not a criticism of Mineralogy's counsel.
On the present application and in response to a question in that regard, counsel for Mineralogy and Mr Palmer in resisting the present application accepted that Mineralogy's failure at the time to make that (preservation) position clear at the time was 'unfortunate' (ts 58). Nevertheless, it was contended that a failure to be more explicit on that issue at the time is no inhibition to a current pursuit of the causes of action, subsequently. With respect, I disagree.
Given what was, even at the start of 2017, an immense prior and surrounding procedural history background underlying CIV 1808 of 2013 (now canvassed), which had included a prior amendment and removal of the MRP money claim, incorporation of that MRP claim into a fresh action, a permanent stay of that action on the basis of it being assessed then as an abuse of process by Chaney J, a revival of the same MRP money claim against Sino Iron, Korean Steel and CITIC Ltd by its 4FASOC by Mineralogy in CIV 1808 of 2013, the situation cried out to be dealt with as regards the excised claims of Mineralogy. In January 2017 there was an obvious need for Mineralogy to be upfront with the court and with the CITIC defendants about the future exposure position concerning the excised MRP money claim - as well as other civil claims which were then effectively proposed to be removed under Mineralogy's further proposed final pleading amendments for a trial.
With almost $US200 million at stake via the MRP money claim as was formerly claimed in CIV 1808 of 2013 and is claimed again under the present action (and previously in its multiple now discontinued predecessors), there must be no loss of perspective as to the potential fiscal magnitude of this claim. It was and is huge. A deliberate forensic decision was obviously made by Mr Palmer for Mineralogy at December 2016/January 2017 to prioritise Mineralogy's RCB claim over the MRP claim. Commercially speaking, that was a perfectly sensible and understandable tactical decision to take then. If the RCB issues were ultimately resolved relatively swiftly in Mineralogy's favour, as they have been to date, that result over time would generate for Mineralogy fiscal royalty reverse outcomes of a stable and significantly greater fiscal magnitude. Staggering amounts of royalty money had been at issue in CIV 1808 of 2013. Assessed in an overall context it is not difficult to see from a cold and purely quantitative perspective why the MRP money claim against Sino Iron and Korean Steel (and the related FCD guarantee indemnity claim against CITIC Ltd) were then viewed as quantitatively less urgent and less important than the RCB claim - from the position of potential future financial advantage to Mineralogy at the time, if successful. Mr Palmer's deliberate, tactical prioritisation decision to that end for the RCB claim followed. Nothing was said about the MRP money claim other than that it was being excised from Mineralogy's proposed further pleaded statement of claim.
But had Mineralogy in early 2017 seriously then wished to preserve a future position as regards the MRP money claim taken out of CIV 1808 of 2013, the preservation of that claim could and should have been canvassed with the court. It was not beyond the wit of senior counsel and the court to hive off, or to defer discrete issues from CIV 1808 of 2013 for later.
Had that course been asked for by Mineralogy, associated temporal explanations as were being proffered in defence of delays to production as pleaded by the CITIC defendants' defence and counterclaim might have been deferred to a later time. Those causes of action could have been discussed and identified to be 'parked' and dealt with under a distinct timetable and trial directions.
Such a course was not raised with the court. It will be remembered that it was the deliberate decision of Mr Palmer for Mineralogy, in the wake of my December 2016 reasons (Mineralogy [No 13]), not to press for a determination of any preliminary issue, as regards just the RCB issues on agreed facts.
Instead, Mineralogy deliberately chose to pare down its whole action in CIV 1808 of 2013 so as to run a full trial to a completion, on an expedited basis heard in June 2017. All that was Mineralogy's cold, calculated, voluntary forensic tactical decision, carefully taken for it then by its guiding directorial mind, Mr Palmer. That decision was not forced upon Mineralogy - but it necessarily carries its consequences.
As the CITIC defendants correctly point out, not only would it have been possible if the issue were explicitly raised by Mineralogy to direct consideration at them hiving off and 'parking' the MRP money claims and their defences to some deferred later time by bespoke directions and orders to that end, the very exercise of 'parking' was undertaken for Mineralogy in CIV 1808 of 2013 then, in respect of some of its other claims in CIV 1808 of 2013. Such 'parked' claims at then included Mineralogy's as then pleaded restitution claim. So addressed then were the MRSLA 'rectification' arguments (albeit they were later not proceeded with, as unnecessary).
But the fact that there was some explicit 'parking' of other claims then, from out of CIV 1808 of 2013, reinforces the availability of such an option towards the MRP money claim had it then been raised explicitly by Mineralogy at the time. It was not.
Resisting the present application, Mineralogy and Mr Palmer, as now seen, both contend that at a point in late 2016, early 2017 in the correspondence passing between respective lawyers, Mineralogy had offered an inter partes undertaking to the CITIC defendants not to pursue in future any of Mineralogy's excised claims, including the MRP money claim. However, they say that their inter partes offer as made across the December 2016 - January 2017 period was rebuffed by the CITIC defendants, who demanded more. The CITIC defendants asked for an express undertaking as to such finality to be given by Mineralogy to the court. And Mineralogy would not agree to that extra step.
Hence, it is put that, therefore, Mineralogy's inter partes offer to the CITIC defendants to not pursue in future its as deleted claims from CIV 1808 of 2013 (including the MRP money claim), in effect, then lapsed, by non‑acceptance, or an express rejection by the CITIC defendants.
Such a rejection and lapse, Mineralogy argues, is significant. Coupled to that, it is argued, was the court's refusal at the January 2017 directions hearing to impose that as an express condition of Mineralogy's further leave to amend in respect of an as foreshadowed 5FASOC - namely, that leave to so amend only be granted to Mineralogy on the condition that all of Mineralogy's as excised claims from CIV 1808 of 2013 not ever be revived under any future litigation by Mineralogy. But I am unable to accept that retrospective gloss on what occurred.
For the purposes of evaluating Mineralogy's explanations and its submissions summarised above, I have revisited again all Mr Palmer's affidavits sworn and filed across December 2016 and of January 2017. They are found collected in Mr O'Donahoo's first affidavit: see POD-35, 39 and 48. Furthermore, I have read again all passing December 2016/January 2017 lawyer correspondence collected by Mr O'Donahoo as possibly bearing upon this issue at the time, again within the various pages of Mr O'Donahoo's first affidavit. Taken as a whole, Mineralogy and Mr Palmer's present suggestion that the inter partes undertaking by Mineralogy to not pursue its deleted claims in future was conditional upon that proposal being accepted at then by the CITIC defendants is, in my present assessment, simply not a supportable proposition. The so‑called undertaking discussed then in the correspondence was, on my assessment, wholly unqualified.
Beyond that, I refer to my reasons in Mineralogy [No 14] of 27 January 2017. At [50] of those reasons, under a heading, 'Is Mineralogy ready, willing and able to perform its obligations under the MRSLAs at this time?', I gave there four subsequently referenced considerations that had all borne upon me in reaching my affirmative conclusion to that question. The fourth of those identified factors I then had expressed, as follows:

[232]

Revisiting now all the multiple issues and voluminous materials then put before me at January 2017 (see Mineralogy [No 14] [3] - [6]) only serves to reconfirm what I had then assessed to be Mineralogy's expressed position at that time, namely, that Mineralogy was then telling the court as it had told the CITIC defendants in the lawyers' correspondence, that it wished to proceed to an expedited trial of CIV 1808 of 2013. The proposed trial would be on a pared down claim basis that would be reflected in minutes of proposed amendment towards Mineralogy obtaining leave to amend its statement of claim again and to proceed to a trial on the basis of a 5FASOC, with Mineralogy making significant excisional concessions to that end.
In the exchanged iterations of minutes of proposed excisional amendments to Mineralogy's 4FASOC, as were then circulated for that purpose, the formerly raised MRP money claim was always ruled through - showing it as being then proposed to be removed for the purpose of obtaining the required leave to amend as then was being sought by Mineralogy. Of course, this was in a context of the urgent trial of RCB issues then being sought by Mineralogy. The expedited trial course was then being fulsomely opposed as inappropriate and, in effect, unachievable by the CITIC defendants at January 2017.
Re-reading those materials again for the purposes of the present application only reaffirms my impression gained at 20 January 2017 which, namely, was to the effect that Mineralogy's excised claims, save where they were expressly being said then by Mineralogy to be being preserved (ie, 'parked'), were otherwise then being permanently removed. That was the 'price', in effect, of the leave to amend the statement of claim of Mineralogy. Unless expressly parked, Mineralogy's excisions were on a once and for all and final basis. That is the rationale for my reference as seen at [50(d)] of Mineralogy [No 14] to the 'undertakings and assurances' which have been provided in the passing correspondence from Mineralogy.
All the passing lawyer to lawyer correspondence, specifically in relation to the MRP money claim (bearing in mind that there was a multitude of other issues also being discussed as in contention at that time), did not then, and does not now, convey to me that there was any qualification at all then put by Mineralogy to the inter partes undertakings it had articulated then to not proceed with excised claims in the future, if Mineralogy were given leave to amend so as to obtain an expedited trial just concerned with the RCB issues.
In other words, with due respect, I cannot accept as presently accurate or persuasive the attempted rationalisations by Mr Palmer and Mineralogy to the effect that the undertakings referred to in the passing correspondence were only ever put conditionally upon them being accepted then by the CITIC defendants. That is not said. That is not my assessment of the position. And, of course, it would have been very easy then for Mineralogy to make the presumptive future position explicit.
As a result, the court proceeded from 27 January 2017 on a basis that, save where something had been said explicitly as to the then 'parked' claims, the excised claims of Mineralogy were being removed once and for all. That is the explanation for my 'dancing at shadows' remark made to Mr Scerri QC for the CITIC defendants at the hearing on 20 January 2017 (CIV 1808 of 2013, ts 1,540).
Given my remark then to Mr Scerri QC, it would have been the easiest thing for Mineralogy at that hearing, competently represented through senior counsel, to have clarified Mineralogy's position to expressly seek to preserve for the future for Mineralogy the as excised MRP money claim - were that genuinely intended then that they might potentially be revived in some future litigation. The comment made at the time towards the fanciful nature of such a potentiality in the exchange with Mr Scerri QC saw me then diminishing the prospects of such a contingency. Mr Scerri QC had expressed his concerns based upon his suffering of many prior adverse experiences over excised causes of action then being revived by Mineralogy under future amendments. Mr Scerri QC's expressed scepticism has subsequently been vindicated, over my naive assessment at the time.
It was a surprise to later learn of the commencement of Mineralogy's action CIV 3166 of 2017, on 21 December 2017, pursuing the MRP money claim against Sino Iron, Korean Steel and CITIC Ltd. Until the present application, I had not learned of the short lived predecessor action CIV 3011 of 2017, which had raised the same MRP money claim at 24 November 2017 - the action begun by writ the day I delivered my trial reasons for decision in Mineralogy [No 16]. Obviously, by the endorsed statement of claim to that unit, that action had been under an active preparatory consideration for some time before, in order to produce on that very day a fully pleaded out statement of claim as is seen endorsed to that short lived writ.
After CIV 3166 of 2017 was commenced, it was swiftly referred to me for case management. Ultimately, I programmed it to an appointment hearing, given the abuse of process challenge immediately raised against it by the CITIC defendants. It was no real surprise then that Mineralogy later discontinued that action (leave to discontinue not being necessary) on 8 May 2018. The surprise was to learn that the further present action, CIV 3129 of 2018, was commenced by Mineralogy and by Mr Palmer on 11 December 2018.
The explanations as provided by Mr Palmer under his 8 May 2019 affidavit concerning what occurred provide pellucid insights to his thinking and underlying the tactical decisions made at the time for Mineralogy by him. But they do not, with respect, provide any legitimate rationalisation or a proper explanation to justify what occurred.
Deliberate forensic decisions were obviously made by Mineralogy and then implemented on a tactical basis - in a fashion I evaluate must undoubtedly be vexing to the CITIC defendants irrespective of their scale and resources. Recommencements followed by the serial discontinuances as are now seen collected under the procedural history as earlier detailed, on my assessment, constitute an abuse of the processes of the court and of its procedures by Mineralogy and Mr Palmer.
I accept that Mr Palmer was motivated by a desire to simplify matters to obtain an expedited trial at June 2017 for chiefly the RCB issues. I also accept that Mineralogy would have been hampered or frustrated against achieving that objective, if all the MRP money claim arguments, and particularly the CITIC defendants' many delay defences as scheduled and extending over 150 pages by the CITIC defendants needed to be determined. Nevertheless, in the end, that is no excuse for what has unfolded. It was easily avoidable.
As I have already said, an expressly discussed 'parking' for a future determination of the MRP money claim issues for the future could have been explicitly raised to be canvassed by Mineralogy as a future possible reviving claim event, if that prospect were then seriously entertained by Mineralogy. No doubt such a preservation direction would have been resisted. But that was no excuse not to confront the issue head on then. Arrangements could then have been provided for under bespoken case management directions - so that all parties and the court would then have then known, under clear terms, what causes of action were remaining preserved on the table as live, and what claims were then being taken off the table and were gone forever.
No acceptable explanation has been provided to justify Mineralogy's failure to ventilate at the time during January 2017 the issue of a potential revival of the MRP money claim at a later time in another action. Not only was that omission unfortunate, it was contextually illegitimate, in my view.

[253]

Following the exchange of the parties' respective written submissions over costs, it emerges that there is no real debate in either proceeding that the defendants are entitled to receive an award of their taxed costs. It is also clear that neither action advanced as far as the point of a trial. CIV 3166 of 2017 was unilaterally discontinued by the plaintiff. The ensuing action CIV 3129 of 2018, became the subject of a permanent stay, on the basis of an ascertained abuse of process by reason of the bringing of that action. Both actions, in effect, had pursued the same MRP money claim relief, the nature of which I explained in the primary reasons at [8] ‑ [10]. That was a claim for over $US200 million against the defendants.
The issue of principle dividing the parties on the present costs applications of the defendants, is over whether or not the defendants should receive an exceptional costs award in their favour. That order is sought on the basis of a complete indemnification for the defendants' legal costs incurred in both actions prior to their relevant discontinuance or permanent stay in each case.
The defendants in the alternative to pursuing indemnification costs orders, would seek special orders pursuant to s 280 of the Legal Profession Act 2008 (WA) - an outcome that may be seen that I had foreshadowed as prima facie appropriate under [219] of my primary reasons repeated earlier.
As to that lesser costs alternative there is only a minor level disagreement between the parties - with the plaintiffs, Mineralogy and Mr Palmer, in light of those prima facie costs observations, not actively opposing costs scale adjustment orders for the purposes of taxations of costs to be conducted on that basis.
The plaintiffs do not oppose limited special costs orders made by adjustments to the Legal Profession (Supreme Court and District Court) (Contentious Business) Determination 2018 as regards costs scale items 10(a) and 25. Nor do they oppose the raising of the allowable maximum hourly and daily rates for the defendants' senior and junior counsel by 50%. They do oppose any variation to those rates for the defendants' other lawyers.
So the key issue of principle now dividing the parties in their ongoing 'litigious war' is one of principle over the primary pursuit by the defendants of indemnity costs orders in both actions.
The costs clash looks to be driven by matters of tactical leverage, rather than over precise dollars of the legal costs. Each party is immensely well resourced and it is most unlikely that a receipt or non‑receipt of an indemnification costs award by the defendants would render any substantive economic impact as against any of the protagonists.

[266]

Towards principle 4 above see as well the later observations of Murphy JA in Yara Australia Pty Ltd v Oswal [2012] WASCA 264 at [33] as to the pursuit of cases with no chance of success.
By reference to principle 10 above and the applying of the observations from Flotilla Nominees Pty Ltd v Western Australian Land Authority [2003] WASC 122 (S); (2003) 28 WAR 95 at [26], it was pointed out that notwithstanding a special costs order might from the quantitative end result perspective deliver an outcome at the same level as an indemnity costs order, that nonetheless some circumstances may dictate that an unsuccessful party's conduct will call out for a court to declare that some improper or unreasonable conduct by a party or their legal advisors requires an indemnity costs order. See also [11] and [12] of the Swansdale costs reasons mentioned earlier.
Upon the present applications there has been no real attempt by the successful parties (the defendants) to show that there would be some significant quantitative gap as between the costs amounts they would receive on a taxation conducted on the basis of adjusted scale limits (which as seen earlier the plaintiffs would largely accept), as opposed to an order for their complete indemnification as regards their legal costs.
Thus, the in principle basis that is primarily advocated by the defendants in seeking indemnity costs orders in both actions, has been grounded as a matter of principle on their contention that there has been unreasonable or improper conduct on the part of the plaintiffs. They contend that such unreasonable or improper conduct supports the court issuing extraordinary indemnity costs orders in both actions. To that end the successful defendants point out particularly by reference to CIV 3129 of 2018 (which was ultimately assessed by me to be an abuse of process of the court), that the abuse conclusion provides a sufficient platform for its indemnity costs submission, as is illustrated by the Court of Appeal's reasons in Malley's case. See Re Malley SM; Ex Parte Gardner [2001] WASCA 83 at [2].
A stay of an action on the basis that the action is an abuse of process, does provide a basis upon which a court may, not must, issue an order for indemnity costs against the party whose proceeding is so stayed.
In every case a close evaluation of the underlying circumstances, as was discussed in Swansdale at [12], is required. The inquiry may extend wider than simply considering the base outcome of the termination of the litigation itself.

[267]

It is helpful to briefly revisit some key aspects of the primary reasons, towards the rationale for that finding of an abuse of process, and thereupon, for the permanent stay of CIV 3129 of 2018.
In the course of my reasons I had occasion to canvass all of Mineralogy's prior actions including, relevantly, its earlier proceeding CIV 3166 of 2017. That action had been unilaterally discontinued and a pending application for indemnity costs by the defendants, had been advanced under the defendants' chamber summons of 7 June 2018 had been filed.
That costs application had been programmed to a special appointment in 2018. But that application, in effect, came to be deferred, until a determination concerning whether the subsequently issued action CIV 3129 of 2018, was an abuse of process or not.
As has been seen, my end conclusion in CIV 3129 of 2018 effectively upheld the permanent stay application by the defendants on the primary basis of contended abuse of process of the court.
Both actions sought to pursue at various times the same MRP money claim against the defendants. The primary reasons explain that liquidated claim, in effect, advanced contractually under the terms of two MRSLA agreements entered as between Mineralogy and Sino Iron and also with Korean Steel. There had been, as well, a guarantee of those MRP obligations by CITIC Ltd issued under another agreement, known as the Fortescue Co-ordination Deed (FCD). As regards the procedural history concerning pursuits, then non‑pursuits, by discontinuances or otherwise of the same MRP money claim, I had said at [165] ‑ [169] of the primary reasons:
1. As already seen, Mineralogy's short-lived action of four days duration pursuing the MRP money claim again (namely, CIV 3011 of 2017) was commenced on the very day my trial reasons in Mineralogy [No 16] were made available to the parties. Discontinuance ensued, according to Mr Palmer for Mineralogy, because on his reading those trial result reasons Mr Palmer first considered that 'the proper course was to refer the dispute concerning the Minimum Royal claim for expert determination under the MRSLAs': see Mineralogy's written submissions at par 57(a), referring to Mr Palmer's 8 May 2019 affidavit at pars 68 - 73. But later he changed his view about that.
2. Mineralogy's next action again pursuing the MRP money claim, CIV 3166 of 2017, was commenced on 21 December 2017. That came about, it is explained, because, upon further consideration of the trial reasons, Mr Palmer now 'considered the Minimum Royalty claim was not one of the categories of dispute identified in the MRSLAs and being referrable to expert determination': see Mineralogy's written submissions par 57(b).
3. Action CIV 3166 of 2017, of course, was challenged by the CITIC defendants in a similar vein to the present application - as an abuse of process. An interlocutory application of the defendants to dismiss that action as an abuse of process had been set down for a hearing before me, with the usual associated directions for the exchanges of evidence and of written submissions beforehand. But this action was discontinued. That, it is now explained, was upon the decision taken to add Mr Palmer as a co‑plaintiff to the proceedings - which was also opposed by the defendants - and because (see Mineralogy's written submissions par 57(b)):

[270]

I am of the end view that application of the abuse of process principles as recently applied in UBS AG v Tyne requires the present action by Mineralogy and Mr Palmer must, indeed, be evaluated as an abuse of the process of the court. As a result it must be permanently stayed, in my view.
As a matter of the everyday case management of CIV 1808 of 2013, which I case managed from October 2016 to its ultimate trial outcome, I observe that it would have been the easiest thing for Mineralogy, through highly competent senior counsel, over the period between December 2016 to January 2017, whilst then begging for the urgent trial hearing dates for that action, to deal with this issue explicitly. Mineralogy was then contemplating excision amendments to its then 4FASOC. Mineralogy could then have told the court, so instructed and openly, that Mineralogy was seeking to preserve for itself, so as to possibly revive at a later date if it thought fit, some or all of the civil causes of action it had previously pleaded out in CIV 1808 of 2013 seeking liquidated amounts against Sino Iron, Korean Steel and CITIC Ltd. That potentially was never said or even hinted at. An attempted express preservation of the MRP money claim then and, indeed, of an allied guarantee or indemnity under the FCD, were being taken off the table from CIV 1808 of 2013. Concern was being expressed then by the CITIC defendants about a future revival of such claims. If Mineralogy was not then abandoning these claims once and for all time, then something to that effect could and should surely have been said. It was not. That observation is not a criticism of Mineralogy's counsel.
On the present application and in response to a question in that regard, counsel for Mineralogy and Mr Palmer in resisting the present application accepted that Mineralogy's failure at the time to make that (preservation) position clear at the time was 'unfortunate' (ts 58). Nevertheless, it was contended that a failure to be more explicit on that issue at the time is no inhibition to a current pursuit of the causes of action, subsequently. With respect, I disagree.
Given what was, even at the start of 2017, an immense prior and surrounding procedural history background underlying CIV 1808 of 2013 (now canvassed), which had included a prior amendment and removal of the MRP money claim, incorporation of that MRP claim into a fresh action, a permanent stay of that action on the basis of it being assessed then as an abuse of process by Chaney J, a revival of the same MRP money claim against Sino Iron, Korean Steel and CITIC Ltd by its 4FASOC by Mineralogy in CIV 1808 of 2013, the situation cried out to be dealt with as regards the excised claims of Mineralogy. In January 2017 there was an obvious need for Mineralogy to be upfront with the court and with the CITIC defendants about the future exposure position concerning the excised MRP money claim - as well as other civil claims which were then effectively proposed to be removed under Mineralogy's further proposed final pleading amendments for a trial.
With almost $US200 million at stake via the MRP money claim as was formerly claimed in CIV 1808 of 2013 and is claimed again under the present action (and previously in its multiple now discontinued predecessors), there must be no loss of perspective as to the potential fiscal magnitude of this claim. It was and is huge. A deliberate forensic decision was obviously made by Mr Palmer for Mineralogy at December 2016/January 2017 to prioritise Mineralogy's RCB claim over the MRP claim. Commercially speaking, that was a perfectly sensible and understandable tactical decision to take then. If the RCB issues were ultimately resolved relatively swiftly in Mineralogy's favour, as they have been to date, that result over time would generate for Mineralogy fiscal royalty reverse [sic, revenue] outcomes of a stable and significantly greater fiscal magnitude. Staggering amounts of royalty money had been at issue in CIV 1808 of 2013. Assessed in an overall context it is not difficult to see from a cold and purely quantitative perspective why the MRP money claim against Sino Iron and Korean Steel (and the related FCD guarantee indemnity claim against CITIC Ltd) were then viewed as quantitatively less urgent and less important than the RCB claim - from the position of potential future financial advantage to Mineralogy at the time, if successful. Mr Palmer's deliberate, tactical prioritisation decision to that end for the RCB claim followed. Nothing was said about the MRP money claim other than that it was being excised from Mineralogy's proposed further pleaded statement of claim.
Furthermore, I said this at [203], [204], [206] and [207]:
1. In other words, with due respect, I cannot accept as presently accurate or persuasive the attempted rationalisations by Mr Palmer and Mineralogy to the effect that the undertakings referred to in the passing correspondence were only ever put conditionally upon them being accepted then by the CITIC defendants. That is not said. That is not my assessment of the position. And, of course, it would have been very easy then for Mineralogy to make the presumptive future position explicit.
2. As a result, the court proceeded from 27 January 2017 on a basis that, save where something had been said explicitly as to the then 'parked' claims, the excised claims of Mineralogy were being removed once and for all. That is the explanation for my 'dancing at shadows' remark made to Mr Scerri QC for the CITIC defendants at the hearing on 20 January 2017 (CIV 1808 of 2013, ts 1,540).

[271]

It was a surprise to later learn of the commencement of Mineralogy's action CIV 3166 of 2017, on 21 December 2017, pursuing the MRP money claim against Sino Iron, Korean Steel and CITIC Ltd. Until the present application, I had not learned of the short lived predecessor action CIV 3011 of 2017, which had raised the same MRP money claim at 24 November 2017 ‑ the action begun by writ the day I delivered my trial reasons for decision in Mineralogy [No 16]. Obviously, by the endorsed statement of claim to that unit, that action had been under an active preparatory consideration for some time before, in order to produce on that very day a fully pleaded out statement of claim as is seen endorsed to that short lived writ.
After CIV 3166 of 2017 was commenced, it was swiftly referred to me for case management. Ultimately, I programmed it to an appointment hearing, given the abuse of process challenge immediately raised against it by the CITIC defendants. It was no real surprise then that Mineralogy later discontinued that action (leave to discontinue not being necessary) on 8 May 2018. The surprise was to learn that the further present action, CIV 3129 of 2018, was commenced by Mineralogy and by Mr Palmer on 11 December 2018.
Concluding at [211] ‑ [213], I said:
1. As I have already said, an expressly discussed 'parking' for a future determination of the MRP money claim issues for the future could have been explicitly raised to be canvassed by Mineralogy as a future possible reviving claim event, if that prospect were then seriously entertained by Mineralogy. No doubt such a preservation direction would have been resisted. But that was no excuse not to confront the issue head on then. Arrangements could then have been provided for under bespoken case management directions - so that all parties and the court would then have then known, under clear terms, what causes of action were remaining preserved on the table as live, and what claims were then being taken off the table and were gone forever.
2. No acceptable explanation has been provided to justify Mineralogy's failure to ventilate at the time during January 2017 the issue of a potential revival of the MRP money claim at a later time in another action. Not only was that omission unfortunate, it was contextually illegitimate, in my view.

[287]

As regards the appropriate dispositive costs orders in CIV 3129 of 2018, by my assessment, and essentially for all the reasons which are found collected by reference to the anterior procedural history of the MRP money claims as earlier run in this court under my primary reasons, the conduct of Mineralogy and Mr Palmer by initiating and pursuing CIV 3129 of 2018 was, at minimum, unreasonable conduct.
That, I assess, is particularly so, in light of the observations I rendered concerning Mineralogy's inter partes undertakings which had been offered regarding the MRP money claim action being ended for all time.
For the MRP money claim to then emerge yet again, in the face of that undertaking, I assess, was entirely unreasonable. In effect, I said as much to counsel about such a contingency should it ever happen.
Furthermore, the further pursuit of a once thought to be fully abandoned claim for in excess of US$200 million was a carefully planned and thought about future event. It was obviously planned in terms of its tactical revival, first seen under the short lived CIV 3011 of 2017, filed with a detailed statement of claim on the very day the trial reasons in CIV 1808 of 2013 in Mineralogy Pty Ltd v Sino Iron Pty Ltd [No 16] [2017] WASC 340 (see my primary reasons at [165]) were delivered. That was clearly a tactical move.
Any MRP revival surprises over the MRP money claim might easily have been avoided by an explicit 'parking' of the MRP money claim on an openly canvassed basis, under a submission to that effect. As I discussed, that never happened.
At the relevant time, an expedited trial was being pursued by Mineralogy in CIV 1808 of 2013. No doubt an application to 'park' the MRP money claim would have been vigorously opposed at the time by the defendants. But even so, the fact that nothing at all was said about it under circumstances where other of the claims of the plaintiffs were then being expressly' parked', delivers a silence over that issue that was deafening and speaks volumes negatively about the plaintiffs' conduct.
In the end, I am of the view that an award of indemnity costs favouring the defendants upon their present application in CIV 3129 of 2018 is thoroughly justified.
Consequently, there should be orders accompanying the permanent stay orders which stipulate that the plaintiffs are to pay the defendants' costs of the action, that is CIV 3129 of 2018, on a full indemnification basis save to the extent that such an order does not authorise the recovery of costs of an unreasonable amount or which have been unreasonably incurred: see Swansdale [17]; Flotilla [28].
That only leaves the question of whether for the predecessor action CIV 3166 of 2017 there should be a similar indemnity costs order or not?

[288]

In the predecessor action which was discontinued on 8 May 2018 the disputed costs determination issues that now present, are almost the same. The recently exchanged submissions received between the parties reflect as much.
But one fresh costs argument as submitted by Mineralogy I need to address, is its resistance submission, to the effect that for the predecessor action, the position as regards its contended unreasonable conduct, ought be viewed more sympathetically, in effect, from a temporal perspective, towards Mineralogy. This is because at the time the High Court had not then delivered its reasons in UBS AG v Tyne, as regards the ascertainment of that an abuse of process. However, I am not at all persuaded by that submission. The effect of the High Court's decision dealing with that aspect of abuse of process in civil actions only declared what actually always was the position under the common law. There was no different common law position that decision altered.
On my assessment, essentially, the same high level magnitude of unreasonable conduct by Mineralogy can be ascertained as regards its commencement and then eventual discontinuance of that action and its pursuit thereof, the MRP money claim. That conclusion is essentially rendered under the circumstances surrounding events of late 2016 and 2017, which gave rise to the basis upon which I was persuaded then to order an expedited trial in CIV 1808 of 2013, at Mineralogy's behest.
In that same context, the court had learned of inter partes undertakings which Mineralogy had canvassed then, in particular by reference to a permanent excision of its MRP money claim which was seen as being ruled out by excisional pleading amendments. That gave rise to the circumstances where a clear impression was then created that the excised MRP money claim cause of action would not see the light of day again. Events which occurred after the trial result in CIV 1808 of 2013 were directly repugnant to the impression then created.
All the same unreasonable conduct by a party to litigation considerations apply with equal force towards the predecessor action CIV 3166 of 2017 as regards costs orders.
Consequently, that discontinued action ought also be made the subject of an order in similar terms favouring the defendants by way of their costs indemnification.

At a glance

Court

Decision date

Before

Source

Judgment (289 paragraphs)

Legislation Cited (4)

Cases Cited (14)