188 The advice from the Department's legal officer related to the validity of one aspect of the Policy, namely, the granting of exemptions under s 102A in relation to exploration licences which authorise the holders to explore for iron, and was not expressed in unequivocal terms. The Department's Minute erroneously recorded the legal officer's advice as referring, in unqualified terms, to the validity of the Policy as a whole.

"It is appropriate to state that all of these exemptions and term extensions were granted on their merits as viewed by [the Department] (acting under delegated Ministerial authority) and on the basis of Western Australia's long-standing (and still current) iron ore policy which has provided for a difference in the treatment of iron ore mining tenements from those of any other commodity. This policy is reflected in a number of 'concessionary' provisions in the Act which are clearly designed to 'accommodate' the holders of such 'iron' licences and the long-term nature of iron ore exploration and development."

After setting out the critical passage which I have quoted at [186] above, the Department's Minute continued:

"You are aware that, notwithstanding any arguments that may be raised in support of the policy, [the Department] has acknowledged the need to properly and fairly accommodate the needs of the new/emerging players into the iron ore industry, and is cognizant of their assertions that the current iron ore policy discriminates in favour of the 'traditional' iron ore producers - particularly allowing them to 'warehouse' for long periods iron ore resources which, according to these major companies, are not currently economical or geographically practical to mine.

[The Department] is now in the process of formulating a 'revised' iron ore policy (and reviewing the Act's concessionary provisions for iron) to reflect current market and community/Government expectations and the general 'spirit' of the Act (ie, that provides for finite timeframes in which mining tenement holders should explore and mine the ground they hold, failing which another party should be given the same opportunity). Key issues being addressed include the question of whether iron ore should be treated like any other commodity, or whether special consideration is still warranted to some degree, and the long-term interests of the major companies as opposed to those of the new players."

190 Although the Department's Minute inaccurately reproduced the legal officer's advice, on my analysis of the Policy, in the context of the Mining Act, the Department's Minute did not misstate, in any material respect, the effect of the Policy or its objectives. In my opinion, the Department's failure accurately to reproduce the legal officer's advice did not, in the circumstances, invalidate the Decision.

191 For the reasons I have given, ground 10(a) fails.

Ground 10(b): the circumstances in which RRJV failed to renew the Expired Licence

192 Ground 10(b) alleges that the Minister erred in law in taking into account, in making the Decision, the circumstances in which RRJV failed to renew the Expired Licence.

193 Ground 10(b) is based on Cazaly's contention as to the proper construction of s 111A(1)(c) of the Mining Act. For the reasons I have given, Cazaly's contention in relation to the proper construction of that provision is without merit.

194 The Minister was entitled to take into account the circumstances in which RRJV failed to renew the Expired Licence. Those circumstances demonstrated that RRJV intended to renew the Expired Licence and the late receipt of the Extension Application was properly to be characterised as having resulted from administrative error. The evident object of the Parliament in enacting s 111A in its current form indicates that the circumstances attending the late lodgement were relevant to the exercise of the Minister's discretionary power.

Ground 10(c): exceptional circumstances justifying the grant of an extension of the term of the Expired Licence if the Extension Application had been lodged in time

196 In ground 10(c) it is alleged that the Minister erred in law in taking into account, in making the Decision, the alleged erroneous conclusion that there were exceptional circumstances which would have justified the grant of an extension of the term of the Expired Licence if the Extension Application had been lodged within the prescribed period, in that the land in question contained an "inferred iron ore resource".

197 Ground 10(c), like ground 10(b), is based on Cazaly's contention in relation to the proper construction of s 111A(1)(c) of the Mining Act and its contentions in relation to the Policy. For the reasons I have given, Cazaly's contentions in relation to those matters are without merit.

198 It was reasonably open to the Minister to conclude that under s 61(2)(b), as in force at the material time, there were exceptional circumstances which would have justified a grant of an extension of the term of the Expired Licence if the Extension Application had been lodged within time. In particular:

(a) the Expired Licence authorised RRJV to explore for iron (which, as I have mentioned, the Act contemplates as exceptional);

(b) RRJV had discovered a substantial inferred iron ore deposit on the land in question; and

(c) it was not feasible for RRJV immediately to mine that resource, alternatively the resource was required for RRJV's future mining operations.

Also, it was reasonably open to the Minister to take that conclusion into account in deciding whether he was satisfied on reasonable grounds in the public interest that Cazaly's Application should not be granted.

Ground 10(d): enabling RRJV to "regain" the subject ground by way of the grant of the Mining Lease Applications

200 Cazaly alleged that the Minister erred in law in taking into account, in making the Decision, the alleged erroneous conclusion that, if Cazaly's Application was terminated, RRJV would "regain" the subject ground by way of the grant of the Mining Lease Applications.

201 Ground 10(d) is based, in part, on Cazaly's contention as to the proper construction of s 111A(1)(c) of the Mining Act. For the reasons I have given, Cazaly's submission in relation to the construction of that provision is without merit.

202 Further, the Minister did not state, in his reasons, that "the RRJV would regain the subject ground". The Minister did not give reasons which were inconsistent with, or act in a manner which was contrary to, the requirement that the Minister exercise his discretion, in due course, in relation to the Mining Lease Applications, in accordance with the Mining Act, including ss 75(6), 111 and 111A.

203 The fact that, upon termination of Cazaly's Application, the Mining Lease Applications would have priority under s 105A(1) of the Mining Act was a relevant consideration which the Minister was entitled to take into account. If a third party, unrelated to RRJV, would have had priority, that fact would have been relevant to the evaluation of whether it was in the public interest to terminate Cazaly's Application. The Minister may properly have taken the view that if an unrelated third party would have had priority under s 105A(1), then, in the circumstances, Cazaly's Application should not be terminated.

205 Ground 10(e) alleges that the Minister erred in law in taking into account, in making the Decision, that, if the circumstances of the parties had been reversed, he would have exercised his discretion to terminate an application by RRJV.

"Fairness

The effective administration of Ministerial discretion under the Western Australian Mining Act requires that the outcomes be consistent.

In considering this matter I was particularly focused on ensuring the answer I came to would be the same were the circumstances of the parties to be reversed. I have no doubt that this would be the case.

In other words, if the roles of [RRJV] and [Cazaly] were to be reversed, I would have found in favour of [Cazaly].

Accordingly I am satisfied that the public interest was best served by terminating [Cazaly's] application."

207 This "reason for decision", which was based on the Minister's perception of "fairness" and "consistency of outcomes", was a factor which the Mining Act did not preclude the Minister from taking into account. It can properly be characterised as a reason based on the Minister's perception of good public administration, and was a view that was reasonably open to him.

208 In any event, the Minister's "reason for decision" based on "fairness" and "consistency of outcomes" was one of three reasons for his decision. The other reasons were based on the Policy and the promotion of investment in Western Australia. The Minister said that each of his reasons was sufficient in itself for his satisfaction that the public interest was best served by terminating Cazaly's Application.

209 In my opinion, the Minister's "reason for decision" based on "fairness" and "consistency of outcomes" reflected the Minister's opinion that his conclusion, that Cazaly's Application should be terminated, was not based on the protection of private interests. The Minister's testing of his conclusion by reference to "fairness" and "consistency of outcomes", as aspects of good public administration, was consistent with the Minister basing his decision, at least in the context of the other two reasons, on "reasonable grounds in the public interest" within s 111A(1)(c).

Grounds 10(f) and 10(g): relative expenditure

211 The Minister elaborated upon the ground of "fairness" at the media conference on 27 April 2006:

"Thirdly, it was the basic issue of fairness, of the Australian 'give a bloke a fair go if he's done the right thing' ...

...

The fairness is the fact. First of all [RRJV] indicated in every way possible that they intended to renew the tenement. [RRJV] have spent over half a million dollars on that tenement. Cazaly have spent nothing. ..."

212 Ground 10(f) alleges that the Minister erred in law in taking into account, in making the Decision, the irrelevant matter that it would be unfair to RRJV not to terminate Cazaly's Application because RRJV had "spent over half a million on the tenement" and "indicated in every way possible that they intended to renew the tenement". Similarly, ground 10(g) alleges that the Minister erred in law, in making the Decision, in that he took into account the irrelevant matter that "Cazaly have spent nothing" on the tenement (which, it is alleged, was, in any event, an unreasonable finding without any basis in evidence).

213 The evidence before this Court establishes that:

(a) Before August 2005, RRJV or its predecessors in title had expended $587,063 in exploration work on the land the subject of the Expired Licence.

(b) Cazaly had not expended any money in exploration work on the relevant land in that it had never held a mining tenement in respect of it.

(c) Cazaly had, however, expended money in connection with making Cazaly's Application, including the preparation of a plan for the development of the Shovelanna resource which was attached to Cazaly's Second Submission.

214 In my opinion, it was reasonably open to the Minister to take into account the money which RRJV or its predecessors in title had expended in exploration of the land the subject of the Expired Licence. That matter was relevant to an aspect of the public interest, namely, the effect on the promotion of investment in this State if the late lodgement of an application to renew a valuable mining tenement as a result of an administrative error were to have consequences significantly disproportionate to the nature of the inadvertence and the extent of the period between the due date for lodgement and the date of actual lodgement. In the circumstances, it was reasonably open to the Minister to conclude that there was a public interest in the preservation of RRJV's private rights to exploit the Shovelanna resource (which would otherwise have been lost).

215 I consider that the Minister was entitled to take into account that, by contrast with the position of RRJV, Cazaly had not expended any money in exploration work on the subject land. The Minister, in stating that "Cazaly have spent nothing" on the tenement was plainly referring to expenditure in exploration work and not expenditure in connection with making Cazaly's Application. The Minister was merely contrasting RRJV with Cazaly in relation to the money which had been spent on exploring the ground the subject of the Expired Licence.

216 Grounds 10(f) and 10(g) are otherwise based on Cazaly's contention as to the proper construction of s 111A(1)(c) of the Mining Act, which I have rejected.

218 Section 19(1) of the Interpretation Act 1984 (WA) permits a court to refer to extrinsic material, in the interpretation of a provision of a written law, if the material is capable of assisting in ascertaining the meaning of the provision, in order to confirm that the meaning of the provision is the ordinary meaning conveyed by the text of the provision, taking into account its context in the written law and the purpose or object underlying the written law, or to determine the meaning of the provision when the provision is ambiguous or obscure or when the ordinary meaning conveyed by the text of the provision, taking into account its context in the written law and the purpose or object underlying the written law, leads to a result that is manifestly absurd or unreasonable. By s 19(2), the extrinsic material that may be considered in accordance with s 19(1) includes, relevantly:

"(f) the speech made to a House of Parliament by a Minister on the occasion of the moving of a motion that the Bill containing the provision be read a second time in that House;

...

(h) any relevant material in any official record of proceedings in either House of Parliament."

219 Section 19 of the Interpretation Act applies to provisions of the Mining Act which were enacted before the commencement of the Interpretation Act. See s 3(1) of that Act.

220 My construction of s 111A and the other provisions of the Mining Act to which I have referred, in the course of considering ground 10, is based upon the ordinary meaning conveyed by the text of the relevant provisions in the context of the Mining Act as a whole and the purpose or object underlying the provisions in question. Although the construction which I prefer does not depend on any extrinsic material, I have considered the extrinsic material to which I have referred for the confirmatory purpose permitted by s 19(1)(a) of the Interpretation Act.

221 At common law (that is, independently of s 19 of the Interpretation Act), a court is also permitted, in construing s 111A and the other provisions of the Mining Act to which I have referred, to have regard to the words used by the Parliament in their legal and historical context and, if appropriate, to give them a meaning that will give effect to any purpose of the legislation that can be deduced from that context. See CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384 at 408; Newcastle City Council v GIO General Ltd [1997] HCA 53; (1997) 191 CLR 85 at 112 - 113. I have examined the legislative history of s 111A and the other provisions to which I have referred for the purpose of confirming the ordinary meaning conveyed by the text of the relevant provisions in the context of the Mining Act as a whole and the purpose or object underlying the provisions in question.

Ground 11: inflexible application of policy

222 Ground 11 alleges that the Minister erred in law in the exercise of his jurisdiction under s 111A(1)(c)(ii) of the Mining Act in that, in adopting and applying the Policy, and concluding that a departure from the Policy would be arbitrary even though the Policy was under review, he failed independently to exercise his discretion following a proper (or any) consideration of the merits of Cazaly's Application.

223 A statutory decision-maker may develop a policy to guide the exercise of a discretionary power. See Re Drake and Minister for Immigration and Ethnic Affairs (No 2) [1979] AATA 179; (1979) 2 ALD 634, where Brennan J said, at 640:

"There are powerful considerations in favour of a Minister adopting a guiding policy. It can serve to focus attention on the purpose which the exercise of the discretion is calculated to achieve, and thereby to assist the Minister and others to see more clearly, in each case, the desirability of exercising the power one way or another. Decision-making is facilitated by the guidance given by an adopted policy, and the integrity of decision-making in particular cases is the better assured if decisions can be tested against such a policy. By diminishing the importance of individual predilection, an adopted policy can diminish the inconsistencies which might otherwise appear in a series of decisions, and enhance the sense of satisfaction with the fairness and continuity of the administrative process."

224 A policy which is adopted by a statutory decision-maker cannot circumscribe or limit the factors which the decision-maker is bound or entitled to consider. As Hely J noted in Elias v Commissioner of Taxation [2002] FCA 845; (2002) 123 FCR 499, at 506 - 507 [34]:

"The Commissioner is entitled to adopt a policy to provide guidance as to the exercise of the discretion, provided the policy is consistent with the statute by which the discretion is conferred. Thus if the statute gives a discretion in general terms, the discretion cannot be truncated or confined by an inflexible policy that it shall only be exercised in a limited range of circumstances. A general policy as to how a discretion will 'normally' be exercised does not infringe these principles, so long as the applicant is able to put forward reasons why the policy should be changed, or should not be applied in the circumstances of the particular case."

225 A statutory decision-maker must not apply a policy so rigidly as to reject an application without hearing the applicant or considering the application's merits. See British Oxygen Co v Board of Trade [1970] UKHL 4; [1971] AC 610 at 625, 631; Sagnata Investments Ltd v Norwich Corporation [1971] 2 QB 614 at 626; Re Drake (No 2) at 641.

226 A policy must not dictate the manner of exercise of a discretionary power. The decision-maker must give "proper, genuine and realistic consideration" to the merits of an application and be ready in a proper case to depart from the policy: Khan v Minister for Immigration and Ethnic Affairs [1987] FCA 457; (1987) 14 ALD 291 per Gummow J at 292.

227 In the present case, the Minister said, in his reasons, that in making the Decision he had "examined the hundreds of pages of submissions provided by both parties, and thought long and hard about their implications". The Minister's reasons set out, relevantly, various undisputed facts, and then noted:

"Against this set of facts and after considering the extensive submissions provided by both parties, I present the following reasons for my decision.

..."

228 The Department's Minute did not advise the Minister as to the manner in which he should exercise his discretionary power. The evidence does not indicate that the Minister considered that he was obliged to terminate Cazaly's Application because of a conclusion or recommendation contained in the Department's Minute.

229 The Minister's statement, in his reasons, that he was of the view that "to arbitrarily deviate from [the Policy's] objectives and present method of implementation" would be detrimental to "the state's sovereign risk profile" and, therefore, contrary to "the public interest", indicates that the Minister was aware that it was open to him to deviate from the Policy but, in the circumstances before him, it would be contrary to the public interest to do so.

230 In my opinion, the Minister's reasons, considered as a whole, do not indicate that he regarded his discretion under s 111A(1)(c)(ii) as being fettered by the Policy. The Minister stated, in his reasons:

"Each of the three reasons I will elaborate upon was sufficient on its own for me to be satisfied that the public interest was best served by terminating [Cazaly's] application."

He then went on to set out and elaborate upon the three reasons which were based upon the Policy, the promotion of investment in this State, and fairness. It is apparent that the Minister recognised that the objectives of the Policy identified a public interest which militated in favour of terminating Cazaly's Application. The Minister identified and took into account the objectives of the Policy and did not merely apply the Policy without regard to the merits of the particular case before him. In my opinion, the Minister gave proper, genuine and realistic consideration to the merits of Cazaly's Application and its submissions. The Decision was not affected by an error of law, as alleged in ground 11.

Ground 12: the role of the Court in determining whether there were "reasonable grounds"

232 As I have mentioned, in the course of construing s 111A(1)(c) of the Mining Act, the phrase "the Minister is satisfied on reasonable grounds in the public interest", in s 111A(1)(c), has three aspects. To reiterate:

(a) section 111A(1)(c) is concerned with the Minister's state of mind; that is, his or her satisfaction;

(b) the Minister must be satisfied, in respect of the whole or a part of the land to which the application relates, that it is in the public interest that the relevant land should not be disturbed or the application should not be granted; and

(c) if the Minister attains the requisite satisfaction in relation to the public interest, there must be reasonable grounds for his or her satisfaction.

233 Where it is alleged that the Minister did not have reasonable grounds for making a decision under s 111A(1)(c), the Court must assess the reasonableness of the relevant grounds, but it must not substitute its own view as to the public interest for that of the Minister. In Attorney-General (NSW) v Quin (1990) 170 CLR 1, Brennan J observed, at 35 - 36:

"The duty and jurisdiction of the court to review administrative action do not go beyond the declaration and enforcing of the law which determines the limits and governs the exercise of the repository's power. If, in so doing, the court avoids administrative injustice or error, so be it; but the court has no jurisdiction simply to cure administrative injustice or error. The merits of administrative action, to the extent that they can be distinguished from legality, are for the repository of the relevant power and, subject to political control, for the repository alone."

Also see SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs [2006] HCA 63; (2006) 81 ALJR 515 per Gleeson CJ, Kirby, Hayne, Callinan and Heydon JJ at 519 [25].

234 In McKinnon, the High Court considered s 58(5) of the Freedom of Information Act 1982 (Cth), which provided, relevantly, that:

"Where application is or has been made to the [Administrative Appeals Tribunal] for the review of a decision refusing to grant access to a document in accordance with a request, being a document that is claimed to be an exempt document under s 36 and in respect of which a certificate is in force under that section, the Tribunal shall ... if the applicant so requests, determine the question whether there exist reasonable grounds for the claim that the disclosure of the document would be contrary to the public interest." [My emphasis]

The issue in the appeal was as to the test to be applied to a review under the Freedom of Information Act of a conclusive certificate of a Minister denying access to documents produced in or to the Minister's Department. Callinan and Heydon JJ (who, with Hayne J, constituted the majority) held, at 1576 [129], that the Act provided no mandate for any "balancing exercise". Their Honours said, at 1577 [131]:

"The test upon which the Tribunal settled after summarising a number of earlier cases decided by the Tribunal, and on appeal to the Full Court of the Federal Court, was whether the facts established before the Tribunal were sufficient to support the claim that disclosure would be contrary to the public interest in the mind of a person guided by reason. We would prefer to ask the question in terms of the language of the legislation itself, rather than any adaptation of it, because the former is perfectly clear in asking whether there exist reasonable grounds for the claim that the disclosure of the documents would be contrary to the public interest. The test actually posed by the Tribunal however was certainly, on no view, less advantageous to the appellant than the statutory language prescribes. It does follow, as the majority in the Full Court effectively held, that if one reasonable ground for the claim of contrariety to the public interest exists, even though there may be reasonable grounds the other way, the conclusiveness will be beyond review. It is important to notice that the statutory language does not give an entitlement to access if there are, as often there may very well be, reasonable grounds for the revelation of the document in the public interest. It further follows that the Tribunal is not obliged to undertake a balancing exercise of the kind the appellant submits it was bound to do. The role of the Tribunal in the circumstances of, and on the basis of the statutory language governing this case, is not to undertake a full merits review of the kind contemplated by s 43(1) of the AAT Act." [My emphasis]

Gleeson CJ and Kirby J (who dissented) held, at 1553 [12], that it is not enough for the Tribunal to ask whether there are facts, or opinions, or arguments that rationally bear upon whether, objectively considered, there are reasonable grounds for the claim that the disclosure of the document would be contrary to the public interest. Their Honours emphasised that all relevant matters must be taken into account for the purpose of deciding whether there are reasonable grounds for the claim which the Minister accepted. On the issue of "balancing", in the statutory context at hand, Gleeson CJ and Kirby J said, at 1554 - 1555 [19]:

"We have avoided reference to 'balancing'. This is a concept that assumes prominence in a different context, in which courts are required to deal with claims of public interest immunity advanced in opposition to the production of documents, for example under subpoena, in civil or criminal litigation. There, it is the public interest in the administration of justice, and considerations of fairness to litigants, that may need to be weighed against aspects of the public interest put at risk by disclosure of documents. [See, eg, Conway v Rimmer [1968] UKHL 2; [1968] AC 910; Sankey v Whitlam (1978) 142 CLR 1, 53 ALJR 11; Air Canada v Secretary of State for Trade (No 2) [1983] 2 AC 394] The image of the scales of justice is pervasive in legal thinking, and it is natural to talk of taking account of competing considerations in those terms. Under the FOI Act, however, the matter of disclosure or non-disclosure is not approached on the basis that there are empty scales in equilibrium, waiting for arguments to be put on one side or the other. There is a 'general right of access to information ... limited only by exceptions and exemptions necessary for the protection of essential public interests [and other matters not presently material]' (s 3(1)(b)). That is the context in which a Minister makes a decision under s 36(3), and in which such a decision is reviewed under s 58(5). References to 'balancing' create a danger of losing sight of that context. That is the context in which the question of reasonableness raised by s 58(5) is to be addressed. To lose sight of that would be to lose sight of the principal object of the FOI Act."

Hayne J noted, at 1562 [55], that the Tribunal's task is not to decide what assessment of the public interest is to be preferred. Rather, its task is to answer the statutory question, namely, are there reasonable grounds for the claim that disclosure would be contrary to the public interest? His Honour added, at 1562 [56]:

"Again it may be accepted that there may be (and very often will be) competing considerations that are relevant to what I have called the statutory question posed by s 58(5). The Tribunal's task is not to be confined to examining those considerations separately. In particular, it is not to be confined to deciding whether one of the considerations advanced in support of a claim, that a document or documents should not be disclosed, can be seen to be based in reason. Rather, the Tribunal's task is to decide whether the conclusion expressed in the certificate (that disclosure of particular documents would be contrary to the public interest) can be supported by logical arguments which, taken together, are reasonably open to be adopted and which, if adopted, would support the conclusion expressed in the certificate. The focus of the Tribunal must be upon the grounds for the conclusion. Are those grounds 'reasonable grounds'?"

235 In my opinion, the role of this Court, in assessing the reasonableness of the grounds of the Minister's satisfaction, within s 111A(1)(c), that Cazaly's Application should not be granted, is to assess whether each expressed ground for the Decision is properly to be characterised as a reasonable ground for his satisfaction in the public interest that Cazaly's Application should not be granted. If any expressed grounds for the Decision are unable properly to be characterised as reasonable grounds for the Minister's satisfaction, it will be necessary to consider whether any remaining ground, that is properly to be characterised as a reasonable ground, is capable of supporting his satisfaction. Compare R v Broadcasting Complaints Commission; Ex parte Owen [1985] QB 1153 per May LJ at 1177.

236 Further, in determining whether there were reasonable grounds for the Minister to attain the requisite satisfaction under s 111A(1)(c) in relation to the public interest, it is necessary to evaluate the facts and other information which the Minister had before him, or otherwise considered, when he made the Decision in the context of the factors which the Minister was entitled or obliged to take into account. The role of this Court is not to determine what assessment of the public interest is to be preferred. Rather, the issue for this Court is whether there were reasonable grounds for the Minister's satisfaction that it was in the public interest that Cazaly's Application should not be granted. See [84] above.

237 The Minister concluded that he should not "arbitrarily deviate" from the "objectives and present method of implementation" of the Policy. In other words, it was not appropriate to deviate from or not apply the Policy to the particular case. The Minister expressed the view that it would be "detrimental to the State's sovereign risk profile and therefore contrary to the public interest" if the Policy were not to be applied in the present case. He concluded, on the basis of the information and submissions before him, that "the objectives of the [Policy] and therefore the public interest" would best be achieved by terminating Cazaly's Application.

238 In my opinion, it was reasonably open to the Minister to decide that, on the facts of the present case, Cazaly's Application should not be granted. His reference to "sovereign risk profile" related to the reliance which participants in the iron ore mining industry had come to place on the Policy as a result of its long-term nature and its consistent application in practice. At all material times, RRJV intended to apply to renew the Expired Licence. It failed to lodge the Extension Application as a result of administrative error. The lodgement was out of time by about five days. If the lodgement had been made by the due date, the extension sought by RRJV would have been granted. It would not have been in breach of the Mining Act to have granted the extension.

239 The ground based on the Policy is properly to be characterised as a reasonable ground for the Minister's satisfaction in the public interest that Cazaly's Application should not be granted.

Ground 12: the ground based on promoting investment in Western Australia

240 The Minister concluded that the public interest in promoting investment in this State would be advanced if "explorers can be confident that their ownership of resources they have discovered is not jeopardised, with consequences disproportionate to minor oversights or actions". The corollary of that proposition is that the public interest would not be advanced if the minor oversight which caused the late lodgement of the Extension Application could lead to the loss of a valuable mineral deposit (namely, the Shovelanna resource) which had been discovered by RRJV or its predecessors in title. In my opinion, it was reasonably open to the Minister to conclude that, on the facts of the present case, it was in the public interest that Cazaly's Application not be granted, for the purpose of advancing the public interest consideration of promoting investment in Western Australia. The ground based on promoting investment in Western Australia is properly to be characterised as a reasonable ground for his satisfaction.

241 The Minister said that the "effective administration" of his discretion under the Mining Act required that "outcomes be consistent". He was certain that if "the roles of [RRJV] and [Cazaly] were to be reversed", he would have "found in favour of Cazaly". It apparent that the Minister was not basing his conclusion, in the context of fairness, on the fact that RRJV was an established and substantial iron ore producer whereas Cazaly was not. The Minister was merely noting that if Cazaly had failed to lodge an application for an extension of a mining tenement in circumstances analogous to those of the case before him, and RRJV had made application for a mining tenement over the whole or a part of the same ground before the application for an extension was lodged, he would have exercised his discretion under s 111A(1)(c) to terminate RRJV's application for a mining tenement. In my opinion, it was reasonably open to the Minister to conclude that the public interest was advanced by applying the criterion of fairness in the manner explained in his reasons, and elaborated upon at the media conference. The ground based on fairness is properly to be characterised, in conjunction with either or both of the other grounds, as a reasonable ground for his satisfaction.

Ground 12: Cazaly's contentions in relation to "reasonable grounds"

242 Cazaly's contentions in relation to grounds 12(a), 12(b) and 12(c), and the existence of "reasonable grounds", rely, in substance, on ground 10. For the reasons I have given, ground 10 fails and Cazaly's submissions in relation to ground 10 have not been made out.

243 Further, Cazaly submitted that the Minister erroneously assumed "that the objectives of the Policy" or "the goals of promoting investment" were "one and the same as the public interest required to be considered under section 111A(1)(c) of the Act". In my opinion, this complaint is without substance. The Minister, in deciding where the public interest lay, took into account, as he was entitled to, the objectives of the Policy, the consequences of departing from the Policy, and the effects which the Decision would have on the confidence of existing and future investors in the State's mining industry.

244 Cazaly asserted, in ground 12(d), that the Minister failed to give any or proper consideration or weight to the following matters which, it submitted, were relevant:

"(i) the importance of transparency and certainty in relation to the administration of tenure under the Act;

(ii) Parliament has not included in the Act a provision allowing the late lodgement of extension of term applications in respect of mining tenements, although it has included express powers to extend time in respect of other matters;

(iii) a decision arbitrarily to terminate [Cazaly's Application] would undermine public and international investor confidence in the impartial administration and operation of the Act;

(iv) the general policy underlying the Act is that a tenement holder is granted exclusive rights for a finite term within which it must explore for and develop a resource failing which those rights will be lost;

(v) [Cazaly's Application] complied with the Act, was in respect of land open for mining under section 18 of the Act, and was first in time;

(vi) [Cazaly] had demonstrated that it had the capability and intention to develop [the relevant land] in the near future, and it was therefore in the public interest, and consistent with the apparent and accepted purpose of the Act, that [Cazaly's Application] be granted;

(vii) [RRJV] had made negligible effort to explore or exploit the iron ore resource, and had no intention of doing so within the foreseeable future."

245 Ground 12(d)(i) refers to "the importance of transparency and certainty in relation to the administration of tenure under the Act". This assertion must be evaluated in the context of the nature and extent of the discretion conferred on the Minister under s 59(6) and s 111A(1)(c). See my analysis of those provisions at [55] - [124] above. As to "transparency", the Mining Act does not require that this value be observed by the Minister in the course of his decision-making under s 111A. But in any event, the Minister adequately explained himself in the reasons he gave for the Decision. As to "certainty", by s 105A(1), the priority which that provision gave to Cazaly's Application was expressly subject to the operation of s 111A. Accordingly, Cazaly did not obtain, as a result of Cazaly's Application, any certainty that it would, in fact, be granted an exploration licence.

246 As to ground 12(d)(ii), it is true that Parliament did not include in the Mining Act a provision permitting the late lodgement of an application to extend the term of an exploration licence, although it did include express powers to extend time in other circumstances, including in relation to a mining lease. See s 111A(1)(d), s 111A(2) and s 78. Parliament did, however, confer on the Minister the discretion contained in s 111A(1)(c)(ii), with the evident intention that the power summarily to terminate or refuse an application for a mining tenement may be exercised in circumstances where another mining tenement has been permitted inadvertently to expire and another person has made an application which would, in the ordinary course, obtain priority under s 105A.

247 As to ground 12(d)(iii), there is no merit in the bare assertion that the Decision was arbitrary. For the reasons I have given at [240] above, it was reasonably open to the Minister to take the view that the Decision would promote, and not undermine, public and investor confidence. Further, the evidence before this Court does not warrant a conclusion that the Decision was arbitrary or partial.

248 As to ground 12(d)(iv), as I have explained at [119] - [124] and [137] - [181] above, the general policy underlying the Mining Act is subject to exceptions, including exceptions relating to tenements which authorise the holder to explore for iron. The general policy referred to in ground 12(d)(iv) is not unqualified or without exceptions.

249 As to ground 12(d)(v), if Cazaly's Application had not complied with the Mining Act or had been in respect of land that was not open for mining under s 18 of the Act, it would have been unnecessary for the Minister to make the Decision. The fact that Cazaly's Application complied with the Act and was in respect of land open for mining was not sufficient, in itself, to confer on Cazaly a right to a grant.

250 Further, as to ground 12(d)(v) and also as to ground 12(d)(vi), it was reasonably open to the Minister to take the view that, in all the circumstances, including:

(a) the circumstances in which Cazaly's Application was made;

(b) the circumstances referred to in the Minister's reasons; and

(c) the circumstances referred to in ground 12(d)(v) and (vi),

there were reasonable grounds in the public interest for Cazaly's Application not to be granted.

251 As to ground 12(d)(vii), the Minister did not find, and he was not obliged on the documents and information before him to find, that RRJV had made "negligible effort to explore or exploit the iron ore resource, and had no intention of doing so within the foreseeable future", as alleged. In any event, the absence of an intention by RRJV immediately to mine the Shovelanna resource was consistent with the Policy, and the public interest did not necessarily preclude the Minister from being satisfied on reasonable grounds in the public interest that Cazaly's Application should not be granted.

252 Cazaly contended that the Decision was an "unreasonable decision". See Re Minister for Immigration and Multicultural Affairs; Ex parte Applicant S20/2002 [2003] HCA 30; (2003) 77 ALJR 1165 in relation to "Wednesbury unreasonableness" as distinct from "irrationality or illogicality". It is true, no doubt, that in one sense, "unreasonableness" will often overlap with "irrationality" or "illogicality". See Aronson, Dyer and Groves, Judicial Review of Administrative Action (3rd ed, 2004) at 339; Australian Retailers Association v Reserve Bank of Australia [2005] FCA 1707; (2005) 148 FCR 446 at 584 [559]. It is unnecessary, in these proceedings, to consider irrationality and illogicality as an independent ground of judicial review or the extent to which that ground is different from Wednesbury unreasonableness.

253 In Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1947] EWCA Civ 1; [1948] 1 KB 223, the question at issue was whether the imposition of a condition imposed by a licensing authority was so unreasonable as to be beyond the proper exercise of the Authority's powers. Lord Greene MR noted, at 230, that the courts can interfere if the decision of a statutory authority on a competent matter is so unreasonable that no reasonable authority could ever have come to it, but to prove a case of that kind requires "something overwhelming". His Lordship emphasised that unreasonableness, in this context, is not what the court considers unreasonable. The decision in question must be proved to be unreasonable in the sense that the court considers it to be a decision that no reasonable body could have come to.

254 In Peko-Wallsend, Mason J noted, at 42, that when the ground of asserted unreasonableness relied upon by an applicant is giving too much or too little weight to one consideration or another "a court should proceed with caution ... lest it exceed its supervisory role by reviewing the decision on its merits". Also see Eshetu per Gleeson CJ and McHugh J at 627 [44].

255 Accordingly, a decision will not be unreasonable in the Wednesbury sense merely because a court disagrees strongly with the decision-maker's process of reasoning in relation to an issue of fact. Further, a decision will not be unreasonable in the Wednesbury sense merely because the decision-maker has given inadequate weight to certain matters and excessive weight to others. As Lord Brightman observed in Puhlhofer v Hillingdon London Borough Council [1986] UKHL 1; [1986] AC 484 at 518:

"Where the existence or non-existence of a fact is left to the judgment and discretion of a public body and that fact involves a broad spectrum ranging from the obvious to the debatable to the just conceivable, it is the duty of the court to leave the decision of that fact to the public body to whom Parliament has entrusted the decision-making power save in a case where it is obvious that the public body, consciously or unconsciously, are acting perversely."

256 For the reasons I have given, at [237] - [251] above, there were reasonable grounds in the public interest for the Minister's satisfaction that Cazaly's Application should not be granted. In those circumstances, the Decision was not manifestly unreasonable in the Wednesbury sense.

257 The Minister did not reach a decision so unreasonable "that it might almost be described as being done in bad faith" or "so absurd that no sensible person could ever dream that it lay within the powers of [the Minister]": Wednesbury at 229. Also see Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Palme [2003] HCA 56; (2003) 216 CLR 212 at 221 [30].

Ground 13: procedural fairness: statutory framework generally

259 Section 111A of the Mining Act does not specify a procedure which the Minister must adopt before summarily terminating or refusing an application. The absence of a prescribed procedure for hearing a party whose rights may be affected by the exercise of the Minister's discretionary power under s 111A is to be compared to and contrasted with other provisions of the Act which require a hearing before the Warden. See, for example, ss 42(3), 59(4) - (5), 70D(4) - (5) and 75(4) - (5). Section 111A(1)(a) expressly empowers the Minister to terminate an application for a mining tenement before the Mining Registrar or the Warden has determined, or made a recommendation in respect of, the application.

260 As I have mentioned, s 59(6) of the Mining Act confers a broad discretion on the Minister to grant or refuse an application for an exploration licence "as the Minister thinks fit", and irrespective of whether:

(a) the report of the Mining Registrar or the Warden recommends the grant or refusal of the licence; and

(b) the applicant has or has not complied in all respects with the provisions of the Act.

261 By s 105A of the Mining Act, where more than one application is received for a mining tenement (other than a miscellaneous licence) in respect of the same land or any part thereof, the applicant who first complies with the "initial requirement" in relation to its application has, subject to the Act including s 111A, "the right in priority over every other applicant to have granted to him in respect of that land or part the mining tenement to which his application relates".

262 In Hot Holdings (1996), the High Court considered two alternative views of the right in priority conferred by s 105A. The first was that the applicant with priority under s 105A is entitled to have the Minister deal with its application without regard to competing applications. That is, the Minister begins by considering only the first application. Subsequent applications are considered only if the first application fails. The second is that the right in priority under s 105A is, as a matter of construction, no more than a right to a grant if there are competing applications and "all things are equal". That is, the Minister considers all the applications which are before the Minister and merely bears in mind that one was first in time. In that situation, where all other things are equal, the application which was first in time will succeed. Brennan CJ, Gaudron and Gummow JJ said, in relation to s 105A, at 170:

"This statute was notable for the manner in which it increased the level of discretion in the Minister to decide applications by reason of policy. The Minister is entrusted with a broad discretion to facilitate decisions about mining tenements without adherence to a rule of strict priority.

It appears that the latter view is preferable. That view has gained some currency. Brinsden J, when dealing with s 105A of the Act in Tortola Pty Ltd v Saladar Pty Ltd and Holloway [[1985] WAR 195 at 205], said:

'Perhaps (but without deciding) so far as the Minister is concerned the section should be read as providing that if all other things are equal the right in priority should be afforded to the earlier application.'

For the purposes of the present appeals, it is not necessary to decide this issue. It is fair to say, at least, that on either view of the right, the Minister is not bound to grant the application of the first in time, or the winner of the ballot."

Dawson and Toohey JJ, who dissented in the result, said, at 178:

"Given the very clear statement of the power of the Minister to grant or refuse an application, it is hard to see that s 105A(1) does more than give the applicant who first complies with the initial requirement a factor in his favour which the Minister cannot ignore, any more than he can ignore any other relevant consideration, but which does not preclude the Minister from refusing that application or acceding to another. The provision does no more than give the applicant who first complies a right to have that application considered in priority to other applications. Vague and inconclusive though this proposition may be, we are unable to extract greater precision when the Act is read as a whole."

263 In my opinion, a decision of the Minister under s 111A to terminate an application for an exploration licence does not deprive the applicant of a right to have the application granted or a right to have the application considered without regard to competing applications. The applicant does not have a right to a grant or a right to have its application considered without regard to competing applications.

264 In the present case, the procedure adopted by the Minister was, in summary, as follows:

(a) Cazaly was provided with a summary of Rio's First Submission, and was given the opportunity to make submissions as to whether the Minister should terminate or refuse Cazaly's Application.

(b) Cazaly accepted the opportunity in making Cazaly's First Submission.

(c) Cazaly was then given the whole of Rio's First Submission to which Cazaly responded in Cazaly's Second Submission.

(d) When RRJV responded to Cazaly's Second Submission in Rio's Third Submission, Cazaly was given a copy of Rio's Third Submission. Cazaly had previously been given a copy of Rio's Second Submission.

(e) Cazaly responded to Rio's Second and Third Submissions in Cazaly's Third Submission. In Cazaly's Third Submission, Cazaly reiterated the points raised in previous submissions and said that no further response to Rio's Second or Third Submissions was necessary.

(f) Each of Cazaly and Rio was then requested by the Department to address a discrete issue as to royalties, to which they responded by Cazaly's Fourth Submission and Rio's Fourth Submission.

By the procedure which I have summarised, Cazaly was given an opportunity to place before the Minister any documents or information which it considered to be relevant to the exercise of the Minister's discretionary power, and to respond to Rio's First, Second and Third Submissions. Cazaly and RRJV were treated on the same basis in relation to the royalty issue in that each was asked to respond to the issue raised by the Department without either seeing the other's response.

265 After all of the submissions were received from Cazaly and RRJV, those submissions were provided to the Minister with advice from the State Solicitor's Office under cover of the Department's Minute. There is no evidence that any other documents or information were placed before or considered by the Minister in making the Decision. Indeed, there is evidence that after the Minister had made the Decision, the material returned by the Minister to the Department comprised the material previously sent by the Department to the Minister. See the affidavit sworn 25 August 2006 by Robert Stevens, the General Manager, Legislation and Compliance Branch, of the Department, at pars 7 - 9.

Ground 13: the relevant principles of procedural fairness

266 The relevant principles of procedural fairness are set out in reasons for decision which I gave in relation to an interlocutory application in these proceedings: Cazaly Iron Pty Ltd v The Hon John Bowler MLA, Minister for Resources [2006] WASCA 282. It is convenient, however, to restate those principles in these reasons.

267 Absent a clear legislative intention to the contrary, a statutory power must be exercised with procedural fairness to parties whose interests might be adversely affected by its exercise. See Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam (2003) 214 CLR 1 at 27 - 28 [81] - [83].

268 The application of the law relating to procedural fairness in connection with decision-makers outside the judicial system must sometimes recognise and accommodate differences between court proceedings and other kinds of decision-making. Rules developed in the context of judicial decision-making cannot be applied automatically to administrative decision-making. See Ebner v Official Trustee in Bankruptcy [2000] HCA 63; (2000) 205 CLR 337 at 343 - 344 [4]; Minister for Immigration and Multicultural Affairs v Jia Legeng (2001) 205 CLR 507, per Gleeson CJ and Gummow J at 538 [99] - [100], per Hayne J at 561 - 566 [177] - [192]; Hot Holdings Pty Ltd v Creasy [2002] HCA 51; (2002) 210 CLR 438 at 460 [70].

269 In Kioa v West [1985] HCA 81; (1985) 159 CLR 550, there was a denial of procedural fairness because the decision in question was made upon information obtained by the decision-maker from another source, without giving the applicant an opportunity to respond to that information. Mason J said, at 582 - 583:

"It is a fundamental rule of the common law doctrine of natural justice expressed in traditional terms that, generally speaking, when an order is to be made which will deprive a person of some right or interest or the legitimate expectation of a benefit, he is entitled to know the case sought to be made against him and to be given an opportunity of replying to it: Twist v Randwick Municipal Council ((1976) [1976] HCA 58; 136 CLR 106 at 109); Salemi v MacKellar (No 2) ((1977) [1977] HCA 26; 137 CLR 396 at 419); R v MacKellar; Ex parte Ratu ((1977) [1977] HCA 35; 137 CLR 461 at 476); Heatley v Tasmanian Racing and Gaming Commission ((1977) [1977] HCA 39; 137 CLR 487 at 498-499); FAI Insurances Ltd v Winneke ((1982) [1982] HCA 26; 151 CLR 342 at 360, 376-377); Annamunthodo v Oilfields Workers' Trade Union ([1961] AC 945). ...

The reference to 'legitimate expectation' makes it clear that the doctrine applies in circumstances where the order will not result in the deprivation of a legal right or interest. Take, for example, an application for a renewal of a licence where the applicant, though he has no legal right or interest, may nevertheless have a legitimate expectation which will attract the rules of natural justice. In Salemi (No 2) (at 404) Barwick CJ expressed the view that the expression 'legitimate expectation' adds little, if anything, to the concept of a right. However, later decisions demonstrate that the concept of 'legitimate expectation' extends to expectations which go beyond enforceable legal rights provided that they are reasonably based: Heatley (at 508-509); FAI (at 348, 351-352, 369, 412); Attorney-General (Hong Kong) v Ng Yuen Shiu ([1983] 2 AC 629 at 636). The expectation may be based on some statement or undertaking on the part of the authority that makes the relevant decision ... Alternatively, the expectation may arise from the very nature of the application, as it did in the case of the application for a renewal of a licence in FAI ... or from the existence of a regular practice which the person affected can reasonably expect to continue: Council of Civil Service Unions v Minister for the Civil Service ([1985] 1 AC 374 at 401). The expectation may be that a right, interest or privilege will be granted or renewed or that it will not be denied without an opportunity being given to the person affected to put his case."

270 In Haoucher v Minister for Immigration and Ethnic Affairs [1990] HCA 22; (1990) 169 CLR 648, Deane J said, at 651 - 652:

"The notion of a 'legitimate expectation' which gives rise to a prima facie entitlement to procedural fairness or natural justice in the exercise of statutory power or authority is well established in the law of this country (see, eg, FAI Insurances Ltd v Winneke ((1982) [1982] HCA 26; 151 CLR 342, at 348, 351, 361 - 362, 369, 376, 390 - 391, but cf at 412)). The notion is not, however, without its difficulty. For one thing, the word 'legitimate' is prone to carry with it a suggestion of entitlement to the substance of the expectation whereas the true entitlement is to the observance of procedural fairness before the substance of the expectation is denied (see, eg, Salemi v MacKellar [No 2] ((1977) [1977] HCA 26; 137 CLR 396, at 452); Kioa v West ((1985) [1985] HCA 81; 159 CLR 550, at 563)). In that regard, there is much to be said for preferring the phrase 'reasonable expectation' which has often been used in judgments in this Court. For another thing, the vagueness of the phrase 'legitimate expectation', which enables it to be used as a convenient label for a broad category of circumstances which will give rise to a prima facie obligation to accord procedural fairness, may convey an impression of comprehensiveness with the result that the absence of an identified legitimate expectation is wrongly seen as a legal mandate for disregarding procedural fairness in any case where no legal right in the strict sense is involved. Regardless of whether one can identify a right in the strict sense or a legitimate expectation, the requirements of procedural fairness must be observed in any case where, by reference to 'the particular statutory framework' (see Mobil Oil Australia Pty Ltd v Federal Commissioner of Taxation (Cth) ((1963) [1963] HCA 41; 113 CLR 475, at 504)), it is proper to discern a legislative intent that the donee of governmental executive power or authority should be bound by them. There is a strong presumption of such a legislative intent in any case where a statute confers on one person a power or authority adversely and directly to affect the rights, interests, status or legitimate expectations of a real or artificial person or entity in an individual capacity (as distinct from merely as a member of a section of the general public). The rationale of that strong presumption is to be found not so much in sophisticated principle as in ordinary notions of what is fair and just."

271 The concept of "legitimate expectation" referred to by Mason J in Kioa and Deane J in Haoucher (and in numerous other authorities) was considered in Ex parte Lam. McHugh, Gummow, Hayne and Callinan JJ held that "legitimate expectation" has limited utility and scope in consequence of it now being accepted that, absent a clear legislative intention to the contrary, a decision-maker exercising a statutory power must comply with the rules of procedural fairness. McHugh and Gummow JJ, in their joint judgment, at 27 [81], referred with approval to the dissenting judgment of McHugh J in Minister for Immigration and Ethnic Affairs v Teoh [1995] HCA 20; (1995) 183 CLR 273 at 311 - 312, and the judgment of Brennan J in Quin at 39. In Quin, Brennan J said:

"So long as the notion of legitimate expectation is seen merely as indicating 'the factors and kinds of factors which are relevant to any consideration of what are the things which must be done or afforded' to accord procedural fairness to an applicant for the exercise of an administrative power (see per Mahoney JA in Macrae v Attorney-General (NSW) (1987) 9 NSWLR 268 at 285), the notion can, with one important proviso, be useful. If, but only if, the power is so created that the according of natural justice conditions its exercise, the notion of legitimate expectation may usefully focus attention on the content of natural justice in a particular case; that is, on what must be done to give procedural fairness to a person whose interests might be affected by an exercise of the power. But if the according of natural justice does not condition the exercise of the power, the notion of legitimate expectation can have no role to play. If it were otherwise, the notion would become a stalking horse for excesses of judicial power."

Also, in Ex parte Lam, see the judgment of Hayne J at 37 - 39 [120] - [122], and the judgment of Callinan J at 45 - 48 [140] - [148].

272 Fairness is essentially a practical concept. It is not abstract in nature. The law of procedural fairness is concerned to avoid practical injustice. See Ex parte Lam, per Gleeson CJ at 13 - 14 [37].

273 The rules of procedural fairness require that decisions be made free from a reasonable apprehension of bias. The general test for apprehended bias is whether a hypothetical fair-minded person who is properly informed as to:

(a) the statutory context and decision-making structure;

(c) the objective facts which are material to the allegation of apprehended bias,

might reasonably apprehend that the decision-maker might not bring an independent and impartial mind to the resolution of the decision he or she is required to make. See Re Refugee Review Tribunal; Ex parte H [2001] HCA 28; (2001) 75 ALJR 982 at 989 - 990 [27] - [29].

274 The application of this principle requires two steps. First, the identification of what it is said might lead the decision-maker to decide the matters in issue other than on their merits. Secondly, an articulation of the logical connection between the matters in issue and the apprehended fear that those matters will not be decided on their merits. See Ebner at 345 [8].

275 The question whether a decision-maker might not bring an independent and impartial mind to the resolution of the relevant issues is one of possibility (real and not remote), not probability. See Ebner at 345 [7]. "Apprehended bias must, however, be quite firmly established": a vague sense of unease or disquiet is not enough. See R v Commonwealth Conciliation and Arbitration Commission; Ex parte Angliss Group (1969) 122 CLR 546 at 553; Jia Legeng at 549 [135].

276 The potential significance, in certain circumstances, of an ex parte communication between one party and the decision-maker, in relation to the "hearing rule" and the "bias rule", was considered by Brennan J in Peko-Wallsend at 58. His Honour said:

"Where a matter submitted to an open inquiry involves a conflict between the interests of parties and the decision is apt to affect some parties advantageously and to affect others detrimentally, an ex parte communication between one party and the decision-maker offends the requirements of natural justice: it deprives the opposing party of an opportunity to be heard on a matter affecting his interests and the integrity of the administrative process is eroded by partiality on the part of the decision-maker. If the fact of the communication is at first kept secret and later becomes known, there is an inevitable appearance of bias in the decision-maker. The general rule, founded firmly on the requirements of natural justice, is that information furnished by an ex parte communication must not be taken into account without giving the parties whose interests might be affected by the information an opportunity to correct or contradict it."

277 In McLachlan v Australian Securities and Investments Commission [1999] FCA 244; (1999) 85 FCR 286, a delegate of the Australian Securities and Investments Commission ("ASIC") was appointed for the purposes of conducting a hearing into the share trading activities of a company, Thompson Brindal Ltd ("TBL") and determining whether to make a banning order in respect of the appellants under s 830 of the Corporations Law. The appellants' solicitors sought access to all documents and materials in the custody or possession of ASIC which were or might be relevant to the matters before the delegate in connection with the hearing into the proposed banning order, and also to any documents relating to ASIC's investigations into TBL. These requests were denied. The delegate informed the appellants that ASIC had disclosed all relevant material. Kenny J (with whom O'Loughlin and Mansfield JJ agreed) held, at 296 - 297 [42], that the principal requirement of procedural fairness was to bring to the appellants' attention the critical issues on which the decision whether to make a banning order was likely to depend. Her Honour said:

"Such critical issues include the matters adverse to the interests of [the appellants] which [the delegate] is considering taking into account in making his decision on the basis that those matters appear to be based on relevant and credible information which is significant to the ultimate decision to be made. The purpose of the requirement is to afford a person in the position of the appellants an adequate opportunity to respond ..."

Her Honour said, at 297 [44], that the delegate was obliged to provide to the appellants all information adverse to the appellants' interests upon which the delegate proposed to rely which was relevant, credible and significant. Procedural fairness did not, however, require that the appellants have access to all material bearing on the subject-matter of the hearing before the delegate which was in the possession of ASIC.

278 In Re Minister for Mines; Ex parte Roberts (1997) 18 WAR 408, the salient facts were these. The applicant applied for forfeiture of two mining leases pursuant to s 98(1) of the Mining Act on the ground that the holders of the leases had failed to comply with annual expenditure requirements. The applicant's applications were heard by a Mining Warden who made a recommendation to the Minister that the leases be forfeited. Upon the making of such a recommendation, s 99 of the Mining Act conferred on the Minister a discretion to declare the leases forfeited. After the Warden made his recommendation, the holders of the leases made further written submissions to the Minister in an attempt to persuade him not to forfeit. Also, the Director, Geological Survey, from within the Minister's department, submitted to the Minister information which suggested that it may not have been economically viable for the holders to have mined the land in question during the relevant period. The applicant was not informed, before the Minister made his decision on forfeiture, of the existence or content of the further written submissions from the holders, or of the information from or opinions expressed by the Director, Geological Survey. The Minister decided not to forfeit the leases. If forfeiture had been ordered, the applicant would have had, by virtue of s 100(2) of the Mining Act, for a period of 14 days after the date of publication of the notice of forfeiture, a right in priority to any other person to mark out or apply for, or both, a mining tenement upon the whole or any part of the land the subject of the forfeited leases. The Full Court of the Supreme Court of Western Australia made absolute, orders nisi for writs of certiorari and mandamus. Steytler J, as his Honour then was (with whom Malcolm CJ and Kennedy J agreed), said, at 418:

" ... once the Minister elected to receive submissions from the tenement holders he was obliged, as a matter of procedural fairness, to afford to the applicant the opportunity to answer those submissions; cf Minister for Aboriginal Affairs v Peko-Wallsend Ltd [1986] HCA 40; (1986) 162 CLR 24 at 46, 60. Moreover, it seems to me that the Minister should not have, in effect, obtained further evidence from the Director, Geological Survey, without affording to the applicant the opportunity to answer, or at least comment on, that evidence. Were the position otherwise, the whole procedure of a full adversary [sic] hearing before the Warden pursuant to the lodging of the plaints by the applicant could effectively be set at nought. It is no doubt for that very reason that the legislature has seen fit to give to the Minister the power to require the Warden to take further evidence or even to re-hear the application when appropriate.

That is not to say, of course, that the Minister can never have the benefit of submissions which were not before the Warden, or take into account evidence which was not placed before the Warden, without sending the matter back to the Warden. However, where those new submissions, or that new evidence, might lead to or materially influence the exercise by the Minister of a discretion adverse to one of the interested parties (as seems to me plainly to have been the situation in this case, in which the Minister was persuaded not to adopt the Warden's recommendation) then he must, at least, give to the affected person the opportunity to be heard in respect of those submissions or that evidence."

Also see Re Plutonic Operations at [19]; Nova Resources at 58; Peko-Wallsend at 46, 60; R v Murphy; Ex parte Clift [1980] Qd R 1 at 9.

279 More recently, in Applicant VEAL of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs [2005] HCA 72; (2005) 225 CLR 88, the High Court considered whether the appellant, who had applied for a protection visa under the Migration Act 1958 (Cth), had been denied procedural fairness by the Refugee Review Tribunal. The appellant's application had been refused by a delegate of the respondent, and the appellant subsequently sought review of that decision by the Tribunal. During the course of the review, the Tribunal received a letter which included information adverse to the appellant's claim for a protection visa. The author of the letter requested the Tribunal not to disclose the information. The Tribunal did not disclose either the existence or the content of the allegations to the appellant, and affirmed the decision under review. In its reasons for decision, the Tribunal stated that it placed no weight on the allegations in question, and that those allegations did not form part of the reasons for refusing the appellant a protection visa. The High Court held, relevantly, that procedural fairness required the Tribunal to inform the appellant of the existence of the letter and the substance of the allegations.

280 In VEAL, Gleeson CJ, Gummow, Kirby, Hayne and Heydon JJ noted, at 95 [14], that it was not useful to begin the inquiry about procedural fairness by examining what the Tribunal said in its reasons. Rather:

" ... as procedural fairness is directed to the obligation to give the appellant a fair hearing, it is necessary to begin by looking at what procedural fairness required the Tribunal to do in the course of conducting its review."

281 The joint judgment in VEAL then referred, at 95 [15], to the well-known statement of Brennan J in Kioa, at 628 - 629, as to the appropriate procedure when an administrative decision-maker has information available that is adverse to the interests of a person who will be affected by the decision. Brennan J enunciated, at 629, two propositions. First, "in the ordinary case where no problem of confidentiality arises an opportunity should be given to deal with adverse information that is credible, relevant and significant to the decision to be made". Secondly, "[i]nformation of that kind creates a real risk of prejudice, albeit subconscious, and it is unfair to deny a person whose interests are likely to be affected by the decision an opportunity to deal with the information". In VEAL, the joint judgment considered, at 95 - 96 [16] - [17], the meaning to be ascribed to the passage "adverse information that is credible, relevant and significant to the decision to be made" in Brennan J's judgment. Their Honours said, relevantly:

" ... what Brennan J said about 'information that is credible, relevant and significant' takes its meaning from the point his Honour had made [at 628] only a few sentences earlier: that '[a]dministrative decision-making is not to be clogged by inquiries into allegations to which the repository of the power would not give credence, or which are not relevant to his decision or which are of little significance to the decision which is to be made'. Moreover, what is meant by 'credible, relevant and significant' must be understood having regard also to the emphasis that his Honour had given earlier in his reasons [at 622] to the fundamental point that principles of natural justice, or procedural fairness, 'are not concerned with the merits of a particular exercise of power but with the procedure that must be observed in its exercise'. Because principles of procedural fairness focus upon procedures rather than outcomes, it is evident that they are principles that govern what a decision-maker must do in the course of deciding how the particular power given to the decision-maker is to be exercised. They are to be applied to the processes by which a decision will be reached.

It follows that what is 'credible, relevant and significant' information must be determined by a decision-maker before the final decision is reached. That determination will affect whether the decision-maker must give an opportunity to the person affected to deal with the information. And that is why Brennan J prefaced his statement about a person being given an opportunity to deal with adverse information that is credible, relevant and significant, by pointing out that there may be information, apparently adverse to the interests of a person, which can and should be put aside from consideration by the decision-maker as not credible, not relevant, or of little or no significance to the decision to be made. 'Credible, relevant and significant' must therefore be understood as referring to information that cannot be dismissed from further consideration by the decision-maker before making the decision. And the decision-maker cannot dismiss information from further consideration unless the information is evidently not credible, not relevant, or of little or no significance to the decision that is to be made. References to information that is 'credible, relevant and significant' are not to be understood as depending upon whatever characterisation of the information the decision-maker may later have chosen to apply to the information when expressing reasons for the decision that has been reached."

The joint judgment concluded, at 96 [18], that it did not follow from the Tribunal's statement, in its reasons, that it gave no weight in reaching its decision to the letter or its contents, that there was no obligation to reveal the information to the appellant and give him an opportunity to respond to it before the Tribunal concluded its review. Further, the Tribunal's obligation to accord procedural fairness to the appellant was not discharged in consequence of the Tribunal deciding that it could decide the application for review on other bases.

282 Gleeson CJ, Gummow, Kirby, Hayne and Heydon JJ then turned their attention, at 97 [19], to whether the letter had or might have had some subconscious effect upon the Tribunal. Their Honours approved the observation of Allsop J in NIB Health Funds Ltd v Private Health Insurance Administration Council [2002] FCA 40; (2002) 115 FCR 561 at 583 [84] that "the necessity to disclose [adverse information] in order to accord procedural fairness is not based on answering a causal question as to whether the material did in fact play a part in influencing the decision". Asking whether, despite what was said in its reasons, the Tribunal may have been subconsciously affected by the information in the letter, distracted attention from the relevant inquiry. Their Honours noted:

"The relevant inquiry is: what procedures should have been followed? The relevant inquiry is neither what decision should the decision-maker have made, nor what reasons did the decision-maker give for the conclusion reached."

The joint judgment held, at 99 [27], that the Tribunal should have informed the appellant of the substance of the adverse allegations in the letter. Although the Tribunal had sought to act fairly, the procedure it adopted was unfair.

Ground 13(a)(i) - (iii) and ground 13(b): the Statement of Principles generally

"By letter dated 13 November 1979 to Texasgulf Australia Ltd (who previously held the stake of Hamersley Resources Limited in RRJV) the then Premier of Western Australia confirmed that it was his intention, in due course, to negotiate and effect a variation of the Rhodes Ridge State Agreement to bring Temporary Reserve 5003H, among others, under its operation (TR 5003H included the ground the subject of E46/209). RRJV have been cognisant of this assurance and have been relying on it to plan an orderly reorganisation of RRJV tenure at the appropriate time. The issue of tenements held by RRJV is also the subject of our ongoing discussions with you over the last 6 months concerning the various State Agreements to which members of the RTIO group of companies are party and which are reflected in the Statement of Principles that is being finalised for execution. These discussions, consistently with the 1979 letter, have been based on the acknowledged need to regard the development of RRJV on an integrated mine basis by bringing all RRJV tenure within the ambit of the Rhodes Ridge State Agreement. They also recognise the need to view, at least in part, the development of these resources in the context of RTIO's broader mining operations in the Pilbara and in the East Pilbara in particular."

284 The Statement of Principles was an agreement made in December 2005 between the State and the Rio Tinto group and recorded in a letter dated 16 December 2005 from the Minister for State Development to the Chief Executive of Rio Tinto Iron Ore. The parties agreed:

(a) to amend various State agreements to alter the rates of royalties payable under those agreements;

(b) that Rio Tinto would participate in and contribute to a study being undertaken by the State in relation to the impact of local government rating provisions of State agreements on local government revenues; and

(c) independently to pursue negotiations in good faith in connection with other issues arising under those agreements.

285 By letter dated 16 November 2005, Cazaly's solicitors wrote to Mr Roy Burton, the Director, Mineral & Title Services Division, of the Department, in relation to various documents referred to in Rio's First Submission. The letter said, amongst other things:

"[Rio's First Submission] refers to a number of documents in support of Rio Tinto's application pursuant to s 111A. In order to properly consider [Rio's First Submission], the Minister needs to be able to review these documents. Furthermore, in accordance with the rules of procedural fairness, our client is entitled to review these documents in order to properly understand the case that it has to meet and in order to be able to respond to [Rio's First Submission]."

The letter requested, in par 5, that specified documents referred to in Rio's First Submission including:

"any file notes of the 'ongoing discussions over the last 6 months' and drafts of the 'Statement of Principles' referred to in par 21 [of Rio's First Submission]",

286 By letter dated 21 November 2005 to Mr Burton, Mr Mark Sokolich, the chief counsel of Rio Tinto Limited, wrote to Mr Burton in relation to the letter dated 16 November 2005 from Cazaly's solicitors:

" ...

In relation to item 5 of [Cazaly's solicitors'] letter, we note that the matters covered in the discussions referred to are of significant commercial sensitivity and include many matters that are of no relevance to our request that the Minister terminate or refuse the above application under s 111A of the Mining Act. Accordingly, we request that you first provide to us copies of any documents the Department proposes to disclose to [Cazaly's solicitors] in response to Item 5 so that we may have the opportunity to peruse them and, if necessary, object to the disclosure. At that time it may also be necessary to discuss the need to obtain undertakings from [Cazaly's solicitors] to preserve the confidentiality of the matters the subject of the discussions referred to.

... "

287 By letter dated 2 December 2005, Cazaly's solicitors wrote to Mr Sokolich in, relevantly, these terms:

" ...

We refer to your letter to Mr Roy Burton of the Department of Industry & Resources dated 21 November 2005.

To address your concerns in relation to the commercially sensitive nature of the documents referred to in paragraph 5 of our letter dated 16 November 2005, our client proposes that the recipients of those documents sign a confidentiality agreement in the form annexed hereto.

Please confirm whether you will consent to the disclosure of the information upon receipt of an executed confidentiality agreement in these terms."

288 By letter dated 8 December 2005 from Mr Burton to Cazaly's solicitors, Mr Burton asserted:

" ...

Regarding your request (No 5 in your letter) for copies of any file notes of the 'ongoing discussions over the last 6 months' and drafts of the 'Statement of Principles' referred to in paragraph 21 of [Rio's First Submission], I have been informed that, to date, searches of this Department's records have uncovered no documents that in our view would fall within the terms of your request or impact on the Minister's consideration of [RRJV's] request that the above application be refused in the public interest."

289 By letter dated 14 December 2005, Mr Sokolich informed Cazaly's solicitors that:

"The provision of the documents requested in paragraph 5 of your letter of 16 November 2005 is a decision to be made by the Department and outside the control of Rio Tinto. Given the Department's response, the offer of a confidentiality undertaking is redundant."

290 In a letter dated 2 February 2006 from Cazaly's solicitors to Mr Burton, Cazaly's solicitors reiterated their request for a copy of the Statement of Principles, together with any file notes of discussions and correspondence between the parties relating to that issue, and asserted, again, that without those documents the applicant was not able properly to understand and respond to par 21 of Rio's First Submission. The letter also records other matters, including the following:

"by letter dated 8 December 2005 you stated that 'searches of this Department's records have uncovered no documents that in our view would fall within the terms of your request or impact on the Minister's consideration of [RRJV's] request that the above application be refused in the public interest'. In a subsequent telephone discussion you have indicated that:

(i) the Department is of the view that these documents are not relevant to the Minister's consideration of RRJV's section 111A application;

(ii) the Department will therefore not supply the documents requested; and

(iii) the RRJV continues to maintain that this material is relevant;

We have requested that the RRJV provide us with this information. The RRJV has refused to do so;"

291 In par 71 of his affidavit sworn 4 August 2006, Nathan Bruce McMahon, a joint managing director of Cazaly, deposes that he has been informed by Robert Edel, Cazaly's solicitor, and believes, that on or about 14 February 2006, Mr Stevens of the Department told Mr Edel that:

"(a) he had advised [RRJV] that he considered that [Cazaly] was entitled to see any documents referred to by [RRJV] in [their] submissions;

(b) [RRJV] had advised him that [RRJV] [were] not willing to disclose to [Cazaly] the Statement of Principles or other documents relating to the negotiations referred to in paragraph 21 of [Rio's First Submission];

(c) he had suggested to [RRJV] that paragraph 21 should therefore be deleted from [Rio's First Submission];

(d) [RRJV] had advised him that they were not willing to delete paragraph 21 from [Rio's First Submission] because in [RRJV's] view it was relevant; and

(e) the Department had obtained legal advice from the State Solicitor's Office in relation to the scope of the Minister's power under section 111A of the Act which was to the effect that the Minister could take into account any matters that he considered relevant and that the Minister was not confined to considering matters directly related to [Cazaly's Application]."

292 Neither the Statement of Principles nor any other documents relating to the negotiations referred to in par 21 of Rio's First Submission were provided to Cazaly before the Minister made the Decision. Also, no other information relating to the Statement of Principles or those negotiations was provided to Cazaly before the Decision was made. Cazaly did, however, make a response to various issues raised in par 20 - 23 of Rio's First Submission. See pars 4, 5, 13(i) and 128 - 130 of Cazaly's Second Submission, which is annexure NBM7 to Mr McMahon's affidavit.

293 On 26 April 2006, five days after the Minister made the Decision, Cazaly's solicitors made an application to the Director of the Department under the Freedom of Information Act 1992 (WA) for access to the Statement of Principles, together with any file notes of discussions and correspondence between the parties relating to that statement. By letter dated 14 June 2006, the Department's Acting Freedom of Information Co-ordinator informed Cazaly's solicitors that the Department was in possession of certain documents within the scope of the request for access, but that access was denied. The documents in question were described, relevantly, as follows:

294 Cazaly's solicitors then sought internal review of the decision of the Acting Freedom of Information Co-ordinator. The internal review was undertaken by the Principal Policy Officer of the Department. On 31 July 2006, Cazaly's solicitors were informed, as follows:

"The reviewer confirms that no other documents were considered to have fallen within the scope of the FOI application, but notes that the Schedule of Documents accompanying [the Department's] notice of decision is somewhat abridged in its description of the relevant documents. The full content of the scope is as follows:

Ministerial regarding Rio Tinto (includes version of Secondary processing options document)

Ground 13(a)(i) - (iii) and ground 13(b): the significance of par 21 of Rio's First Submission

295 Cazaly contended that it was denied procedural fairness in that:

(a) sufficient information about the matters referred to in par 21 of Rio's First Submission was withheld from Cazaly and, as a result, it was, in effect, deprived of the opportunity to be heard on, and respond to, an issue affecting its interests, including a proper opportunity to correct or contradict it; and

(b) par 21 was "akin to an ex parte communication" between RRJV (which knew, in detail, the matters referred to in par 21) and the Minister (who knew, or must be taken to have known, or had the means of ascertaining, in detail, the matters referred to in par 21).

296 In par 21 of Rio's First Submission, it was asserted that, by the letter dated 13 November 1979, the Premier on behalf of the State gave an assurance that the State would negotiate and effect a variation to the Rhodes Ridge State Agreement so that that agreement would apply to the land which was then the subject of Temporary Reserve 5003H and which subsequently became the subject of the Expired Licence. RRJV contended, in essence, that it had relied on the Premier's assurance with a view to rearranging the RRJV tenements, in due course, so that all of those tenements (including, in particular, the land which ultimately became the subject of the Expired Licence) would be governed by the Rhodes Ridge State Agreement. RRJV referred to "ongoing discussions" with Mr Carpenter, in his capacity as Minister for State Development, during the preceding six months concerning various State agreements to which members of the Rio Tinto group of companies were party and noted, in effect, that various matters agreed upon in the course of those discussions had been incorporated in the Statement of Principles. RRJV also noted that the ongoing discussions had recognised the necessity for the State and the Rio Tinto group of companies "to view, at least in part" the development of the RRJV's tenements in the context of the Rio Tinto group's "broader mining operations" in the Pilbara.

297 In pars 22 and 23 of Rio's First Submission, RRJV referred to the decision in Concept Nominees and submitted that the Minister's decision in that case to refuse an application for an exploration licence was made in circumstances similar to those involving Cazaly and RRJV.

298 In my opinion, the only matter raised in par 21 of Rio's First Submission which was capable of being credible, relevant or significant to the Decision was RRJV's assertion that the State had, in the letter dated 13 November 1979, given an assurance that it would negotiate and effect a variation to the Rhodes Ridge State Agreement so that that agreement would apply to the land which ultimately became the subject of the Expired Licence and, in consequence, RRJV was in a position comparable to that of the party to the State agreement in Concept Nominees.

299 On 8 December 2005, Cazaly was given a copy of the letter dated 13 November 1979. The significance (if any) of that letter was addressed by Cazaly in pars 128 - 130 of Cazaly's Second Submission, and in pars 6 and 7 of a written opinion dated 13 December 2005 of a Queen's Counsel retained by Cazaly. A copy of the written opinion was attached to Cazaly's Second Submission. According to Cazaly's Queen's Counsel, the letter did not give rise to any enduring rights or obligations as between Rio Tinto and the State, and did not give rise to "anything approximating" the obligations which the State had under the agreement which was the subject of the decision in Concept Nominees.

300 In my opinion, the provision to Cazaly of copies of Rio's First Submission and the letter dated 13 November 1979 enabled Cazaly and its Queen's Counsel adequately to address the substance of RRJV's submissions in pars 21, 22 and 23 of Rio's First Submission.

301 Cazaly contended, however, in par 130(g) of its written submissions to this Court, that:

"The content of Paragraph 21 is itself a significant indicator. Rio was expressly or impliedly representing that:

(i) the subject matter of the Statement of Principles (i.e. the SoP Matters) weighed in favour of the termination of [Cazaly's Application]; and/or

(ii) the decision in relation to the termination of [Cazaly's Application] could have a bearing on the outcome of the Negotiations."

By "SoP Matters", Cazaly meant matters referred to in the Statement of Principles which were agreed to be the subject of an amendment to the State agreements between the State and the Rio Tinto group (namely, the "Royalty Variation") or were to be negotiated in good faith between those parties (namely, the "Development Deadline Variation", the "Infrastructure Variation", the "Secondary Processing Variation" and the "Tenure Variation"). By "Negotiations", Cazaly meant the negotiations between about 20 April 2005 and about 16 December 2005 which culminated in the Statement of Principles.

302 On 22 December 2006, in determining an interlocutory application in these proceedings, I ordered an officer of the Department, on behalf of the Minister, to provide an affidavit of discovery on oath of documents in the following categories:

"(a) all drafts of a document entitled or described as a 'Statement of Principles' which is referred to in paragraph 21 of the letter from Rio Tinto Limited ('Rio') to the Hon Alan Carpenter MLA, Minister for State Development, dated 21 September 2005 ('Rio's First Submission');

(b) correspondence and other documents relating to or evidencing the 'ongoing discussions with [the Minister] over the last 6 months concerning the various State Agreements to which members of the RTIO group of companies are party' referred to in paragraph 21 of Rio's First Submission, including any memos, file notes or reports relating to the discussions;

(c) the letter from the Hon Alan Carpenter, Minister for State Development, to Rio dated on or about 16 December 2005 in response to a letter from Rio which enclosed the 'Statement of Principles' referred to in paragraph 21 of the First Rio Submission;

(d) the documents described in the facsimile from Robert Whyte of the Department of Industry & Resources ('Department') to Robert Edel of Gadens Lawyers dated 31 July 2006 in relation to the internal review of the decision in respect of application 05/06-71 under the Freedom of Information Act 1992 (WA):

(i) Draft RTIO State Agreements documents dated 1 September 2005 (File R0662/200501; Folio 200-208);

(ii) Draft RTIO State Agreements documents dated 1 September 2005 (File R0662/200501; Folio 191-199);

(iii) Draft RTIO State Agreements documents dated 1 September 2005 (File R0662/200501; Folio 153-161);

(iv) Draft RTIO State Agreements documents dated 16 August 2005 (File R0662/200501; Folio 121-129);

(v) Ministerial Regarding Rio Tinto (including versions of secondary processing options document) dated 13 July 2005 (File R0662/200501; Folio 147, 165 - 170, 179 - 190);

(vi) Draft Secondary Processing Option Documents dated 2 September 2005 (File R0662/200501; Folio 148 - 152); and

(vii) Draft Secondary Processing Option Documents dated 28 July 2005 (File R0662/200501; Folio 115 - 119);

(e) documents relating to the incorporation or proposed incorporation of E46/209, E46/08 or TR5003H into the Rhodes Ridge State Agreement; and

(f) all documents before or otherwise considered by the First Respondent in the course of making the decision to terminate the application for exploration [licence] 46/678 (Decision)."

Discovery was provided pursuant to that order and the discovered documents were inspected by Cazaly's solicitors. Cazaly did not rely upon any of the discovered documents for the purpose of establishing its contention that the alleged representations were made in par 21.

303 In my opinion, par 21 of Rio's First Submission did not contain an express or implied representation, as alleged by Cazaly.

304 Cazaly also contended that the Minister should have disclosed the Statement of Principles to Cazaly for the purpose of assisting it to make submissions concerning the "Royalty Variation", the "Development Deadline Variation", the "Infrastructure Variation" and the "Secondary Processing Variation". In my opinion, RRJV did not make submissions in par 21 of Rio's First Submission in relation to any of those issues. Cazaly did not require the Statement of Principles to be able to address the assertions actually made in par 21.

305 Further, Cazaly contended that it was asserted in par 21 of Rio's First Submission that the Statement of Principles contained an "acknowledged need on the part of the State to bring Shovelanna within the ambit of the [Rhodes Ridge State Agreement]". In my opinion, Cazaly's contention is without merit. Paragraph 21 did not assert that the Statement of Principles specifically dealt with the Shovelanna resource or specifically imposed on the State an obligation to procure an amendment to the Rhodes Ridge State Agreement so that it applied to the land the subject of the Expired Licence.

Ground 13(a)(i) - (iii) and ground 13(b): the rates of royalties

306 At all material times, the rates of royalties payable under the Mining Act were 7.5 per cent for lump iron ore and 5.625 per cent for fines iron ore. Before the alteration to the rates of royalties which was agreed and recorded in the Statement of Principles, the rates payable under the Rhodes Ridge State Agreement were 7.5 per cent for both lump and fines. The alteration, which was agreed in principle in December 2005, changed the rates of royalties under the Rhodes Ridge State Agreement to those payable under the Mining Act as at May 2005. An alteration was also made to the rate payable under the Rhodes Ridge State Agreement in respect of beneficiated ore. Further, the Statement of Principles provided for the rates of royalties payable under other State agreements to which members of the Rio Tinto group were party to be increased.

307 Before the Decision, the Department informed each of Cazaly and RRJV, by letter dated 23 March 2006 from Mr Burton of the Department, that it had identified potential differences in the amount of royalties that would be payable to the State depending on whether Cazaly or RRJV developed the Shovelanna resource. The Department specified the assumptions on which its estimates of the amount of royalties payable were based. Those assumptions included that:

(a) RRJV would pay royalties at the rates payable under the Mining Act on the full international iron ore price, whether mining was conducted under an existing State agreement or not; and

(b) Cazaly would sell iron ore to BHP Billiton at the lease boundary for between 55 per cent and 65 per cent of the full international iron ore price ("the Mine Gate Sale Price") and would pay royalties at the rates payable under the Mining Act on the Mine Gate Sale Price.

The Department estimated that, as a result of the difference in sale price, the amount of royalties which the State would receive from Cazaly would be substantially less.

308 By letter dated 27 March 2006 (Rio's Fourth Submission), RRJV confirmed the correctness of the Department's assumption that RRJV would pay royalties at the Mining Act rates on the full international iron ore price.

1. In substance, the Letter [that is, Mr Burton's letter of 23 March 2006] draws attention to the fact that pursuant to the memorandum of understanding with BHP Billiton (BHPB) Cazaly would pay a royalty on iron ore produced from E46/678 that is calculated by reference to the price paid for the iron ore at the mine gate, which may be less than the price received by BHPB when that iron ore is sold to an international customer pursuant to an export contract.
2. Cazaly has always envisaged, and believes that it is fair and reasonable, that the royalty payable to the State on any iron ore mined from E46/678 would ultimately be based on the full international iron ore price.

1. Having considered the matters raised in the Letter and taken advice, it appears that the royalty that will be payable to the State based on Cazaly's Memorandum of Understanding with BHPB (the MOU) would lead to a royalty being paid which is lower than the royalty that would be payable if the ore were to be sold by the tenement holder directly to an international customer pursuant to an export contract.

1. As stated above, Cazaly believes that the State should receive a royalty on ore produced from E46/678 and ultimately exported that is based on the full international benchmark iron ore price.
2. To achieve this end, a project specific regulation could be implemented that required Cazaly to pay a royalty on iron ore produced from E46/678 that is based on the full international iron ore price, regardless of the price that it receives from BHPB or any other purchaser. Such regulation would simply deem the price paid for the iron extracted from E46/678 to be equivalent to the international benchmark iron ore price (for example, the price paid for Mount Newman lump and fine ore sold to Japanese steel mills on an f.o.b. basis as reported in the Tex Report).
3. Alternatively, a regulation of general application could be enacted require [sic] iron ore miners generally to pay a royalty on the basis of the international benchmark iron ore price.

1. If considered necessary, Cazaly would also be prepared to enter into a binding deed (or State agreement) with the State whereby Cazaly agrees to pay a royalty based on the full international ore price. Such an agreement could be executed quickly if necessary and operate either before the implementation of any project specific regulation or in lieu of such a regulation.

...

In summary, the amount of royalty which the State receives in respect of iron ore from the Shovelanna Tenement, or any other iron ore tenement, is entirely in the hands of the Government. The Government can, by way of simple regulatory change, ensure that the royalty received is not dependent upon whether the holder of the tenement exports the ore itself or sells it to another party for export."

310 In summary, in Cazaly's Fourth Submission, Cazaly:

(a) acknowledged that the Mine Gate Sale Price would be less than the full international iron ore price; and

(b) offered to pay royalties on the full international iron ore price.

311 In my opinion, Cazaly was not denied procedural fairness in relation to any material issues relating to the amount of royalties which the State would receive depending on whether Cazaly or RRJV developed the Shovelanna resource. The failure to inform Cazaly of the agreement between the State and the Rio Tinto group to alter the rates of royalties payable under the State agreements did not materially affect the substance of Cazaly's submissions. The Department requested Cazaly and RRJV to assume, for the purposes of the submissions embodied in Cazaly's Fourth Submission and Rio's Fourth Submission, that the Mining Act rates would apply whether or not there was a State agreement.

Ground 13(a)(i) - (iii) and ground 13(b): Cazaly's submissions in relation to the knowledge of the Minister

312 Cazaly submitted that it was unnecessary, in order to establish a denial of procedural fairness, to prove that the Minister had "actual, constructive or imputed" knowledge of the Statement of Principles, or the Negotiations, beyond the information disclosed in par 21 of Rio's First Submission. It argued, relevantly:

(a) Although Mr Bowler was not, at any material time, the Minister with responsibility for the Rhodes Ridge State Agreement or any other iron ore State agreements, he had ready access to further information about the Statement of Principles and the Negotiations from his Department, his advisers or the Minister for State Development.

(b) Even if it be the case (which Cazaly denied) that Mr Bowler did not have pre-existing knowledge of, and did not through inquiry or otherwise, obtain further information about, the subject matter of par 21 of Rio's First Submission, par 21 was likely to have engendered an assumption or assumptions by Mr Bowler about the content and significance of the Statement of Principles (perhaps as to its importance to the State or to the Minister for State Development), and thereby to have had a conscious or subconscious effect upon Mr Bowler.

(c) The prejudice to Cazaly as a result of its not being provided with reasonable details of the Statement of Principles and the Negotiations, irrespective of whether Mr Bowler had actual knowledge of them, is highlighted by the fact that par 21 was factually inaccurate. Cazaly referred to an email dated 3 May 2006 from Mr Kenneth Weston, an employee of the Department who was involved in the negotiation of the Statement of Principles, to another employee of the Department, which said, relevantly:

"Rio Tinto made reference to the [Statement of Principles] and its view on discussions around negotiations in relation to the issues contained in the [Statement of Principles] in its further submission (paragraph 21) re Shovelanna. I refuted many of Rio's claims under para 21. Apparently my written comments re the accuracy of Rio's claims was [sic] not provided to the Minister and therefore Rio's statements in para 21 could only be taken as read by the Minister. It is on this matter that I am not happy as I believe the Minister should have been told of the inaccuracies contained in para 21."

313 Cazaly submitted that if, contrary to its submission, it had to prove that Mr Bowler had actual knowledge of the Statement of Principles and the Negotiations, then this Court should infer that he did have actual knowledge, based on the following:

(a) The Statement of Principles, the Negotiations and matters relating to the variation of tenure are referred to, but not set out in detail, in par 21 of Rio's First Submission.

(b) A copy of the letter dated 13 November 1979 was annexed to the Department's Minute.

(c) Mr Bowler stated, in his reasons, that he had "examined" and "considered" RRJV's submissions, and in his letter dated 21 April 2006 to Cazaly's solicitors he said that he had given "careful consideration [to] the submissions and counter submissions" of each of the parties and to advice provided by the State Solicitor's Office.

(d) Mr Bowler must have had knowledge of the Statement of Principles, or made inquiries about them, in order to have given careful consideration to the submissions.

(e) Mr Bowler appears not to have sought further information about the Statement of Principles from RRJV.

(f) A Ministerial decision-maker would, in the ordinary performance of his or her duties, have sought further information about par 21 if he or she did not know anything more about the Statement of Principles than was stated in par 21.

(g) Although Mr Bowler was not, at any material time, the Minister with responsibility for the Rhodes Ridge State Agreement or any other iron ore State agreements, at all material times the Department assisted both Mr Bowler and Mr Carpenter (who, in his capacity as the Minister for State Development, had responsibility for the Rhodes Ridge State Agreement and the other iron ore State agreements).

(h) There was at least the potential for overlap, in relation to some of the matters referred to in par 21, between issues which were the responsibility of the Minister administering the Mining Act on the one hand and issues which were the responsibility of the Minister administering the Rhodes Ridge State Agreement and the other iron ore State agreements on the other.

(i) Mr Bowler, in the course of the media conference held on 27 April 2006, in which he answered questions from the media in relation to the Decision and, to some extent, expounded upon the reasons in the "Media Statement" of 27 April 2006, said that he had consulted with Mr Neil Roberts in relation to the Decision:

"The only person I really consulted with verbally, and I don't even know if he knew what my decision was, was my mining adviser, Neil Roberts, and I consulted him on several aspects, but even during these consultations I don't know if [he] ever knew what ... decision I was going to make."

(j) Mr Roberts was involved in the negotiations concerning the Statement of Principles. See the affidavit of Alexander Guy Jones dated 10 January 2007 at pp 79 - 81.

(k) Mr Carpenter, in the course of a radio interview on 27 April 2006 (six days after the Decision) with Ms Geraldine Mellet, said:

" ... when I became the Premier and [Mr Bowler] took over responsibilities for the Mining Act, I told him, and he knew already, that we had this issue [that is, the dispute between Cazaly and RRJV in relation to the Shovelanna resource] under discussion, and whatever we did we had to act properly."

314 Cazaly also submitted that if, contrary to its submissions, it had to prove that Mr Bowler had knowledge of the Statement of Principles, the Negotiations and the SoP Matters, Mr Bowler had constructive knowledge of matters known to his Department, further or alternatively, his adviser, Mr Roberts. It was submitted that further, and in any event, Mr Bowler had constructive knowledge of the Statement of Principles, the Negotiations and the SoP Matters in that Mr Carpenter had that knowledge and he was under a duty to convey his knowledge to Mr Bowler. Mr Carpenter had a duty to advise Mr Bowler, and Mr Bowler had a duty to make inquiries of Mr Carpenter, and those duties arose upon:

(a) Mr Bowler becoming Minister assisting the Minister for State Development;

(b) Mr Bowler replacing Mr Carpenter as the Minister administering the Mining Act; and

(c) Mr Bowler replacing Mr Carpenter during the course of the decision-making process relating to s 111A and Cazaly's Application.

Cazaly submitted that further, and in any event, Mr Bowler had "imputed" knowledge by reason of the fact that the "Minister" responsible for making the decision under s 111A in relation to Cazaly's Application is a corporation sole to which the knowledge of successive holders of the office is imputed.

Ground 13(a)(i) - (iii) and ground 13(b): actual knowledge of the Minister

315 As I have mentioned, the Statement of Principles was an agreement, relevantly, to amend various State agreements to alter the rates of royalties payable under those agreements, and independently to pursue negotiations in good faith in connection with other issues arising under those agreements. The State agreements in question were ratified by State Agreement Acts. At all material times, the administration of those State agreements was vested in the Minister for State Development. Mr Bowler was never the Minister with responsibility for the relevant State Agreement Acts. Although his title included the phrase, "Minister Assisting the Minister for State Development", he did not in that role have any responsibility for the State Agreement Acts which were the subject of the Statement of Principles.

316 There is no evidence that Mr Bowler participated in the Negotiations; that is, the negotiations which culminated in the Statement of Principles. Also, the material which the Department sent to the Minister for his consideration did not include any information about the Statement of Principles or the Negotiations. Further, there is no evidence that the discussions between Mr Roberts and the Minister, referred to at [313(i)] above, concerned the Statement of Principles or the Negotiations. Similarly, there is no evidence that the discussions between Mr Bowler and Mr Carpenter, referred to at [313(k)] above, concerned the Statement of Principles or the Negotiations. Also, there is no evidence that Mr Bowler shared the views in relation to par 21 of the Statement of Principles which Mr Weston referred to in his email dated 3 May 2006.

317 As I have mentioned, on 22 December 2006, in determining an interlocutory application in these proceedings, I ordered the Minister to give discovery of various documents, including all documents before or otherwise considered by the Minister in the course of making the Decision. The Minister complied with that order. On 28 February 2007, in determining another interlocutory application, I ordered Mr Bowler to file and serve an affidavit deposing, to the best of his knowledge, information and belief after causing due and proper inquiries to be made, as to the extent of his knowledge, on or prior to 21 April 2006, of various matters including, in essence, the Negotiations and the content of the Statement of Principles. Mr Bowler complied with that order. However, none of the parties sought to read or rely on Mr Bowler's affidavit at the hearing before this Court.

318 In my opinion, the evidence before this Court does not permit an inference to be drawn that Mr Bowler had actual knowledge, when he made the Decision, of the Negotiations or the content of the Statement of Principles. Indeed, it should be concluded, on the evidence, that, when Mr Bowler made the Decision, his actual knowledge concerning the Negotiations and the Statement of Principles was confined to the material contained in par 21 of Rio's First Submission.

319 My reasons in Cazaly Iron Pty Ltd v The Hon John Bowler MLA, Minister for Resources [2006] WASCA 282 addressed, relevantly, in determining an interlocutory application in these proceedings, whether Cazaly should be given leave to amend ground 13 to raise various arguments in relation to procedural fairness. I permitted Cazaly to amend solely on the basis that its proposed argument was not "so clearly untenable that it cannot succeed": [2006] WASCA 282 at [55], [80].

Ground 13(a)(i) - (iii) and ground 13(b): corporate and constructive knowledge of the Minister

320 Section 10(1) of the Mining Act provides that the Act shall be administered by the Minister. By s 10(2):

"The Minister -

(a) shall be a corporation sole with perpetual succession and shall have an official seal; and

(b) may, in his corporate name, acquire, hold, lease and otherwise dispose of real and personal property, and may sue and be sued in that name."

321 Ministers of the Crown are not common law corporations sole (Hubbard Association of Scientologists International v Attorney-General (Vic) [1976] VicRp 10; [1976] VR 119 at 123 - 125), but they are frequently created corporations sole under statute.

322 In Salmond on Jurisprudence (12th ed, 1966), the nature of a corporation sole, and the points of distinction between a corporation aggregate and a corporation sole, are explained, at pages 66 - 68:

"Corporations are of two kinds, distinguished in English law as corporations aggregate and corporations sole. 'Persons', says Coke, 'are of two sorts, persons natural created of God, and persons incorporate or politique created by the policy of man (and therefore they are called bodies politique), and those be of two sorts, viz, either sole, or aggregate of many.' A corporation aggregate is an incorporated group of co-existing persons, and a corporation sole is an incorporated series of successive persons.

The former is that which has several members at a time, while the latter is that which has only one member at a time. Corporations aggregate are by far the more numerous and important. Examples are a registered company, consisting of all the shareholders, and a municipal corporation, consisting of the inhabitants of the borough. Corporations sole are found only when the successive holders of some public office are incorporated so as to constitute a single, permanent, and legal person. The Sovereign, for example, is said to be a corporation of this kind at common law, while the Postmaster General, the Solicitor to the Treasury, the Secretary of State for War, the Minister of Town and Country Planning, and the Minister of Education have been endowed by statute with the same nature.

... In the case of corporations sole, the purely legal nature of their personality is equally apparent. The chief difficulty in apprehending the true nature of a corporation of this description is that it bears the same name as the natural person who is its sole member for the time being, and who represents it and acts for it. Each of them is the Sovereign, or the Solicitor to the Treasury, or the Secretary of State for War. Nevertheless under each of these names two persons live. One is a human being, administering for the time being the duties and affairs of the office. He alone is visible to the eyes of laymen. The other is a mythical being whom only lawyers know of, and whom only the eye of the law can perceive. He is the true occupant of the office; he never dies or retires; the other, the person of flesh and blood, is merely his agent and representative, through whom he performs his functions. The living official comes and goes, but this offspring of the law remains the same for ever."

323 A corporation sole therefore has two capacities; that of the corporation and that of the natural person. See McVicar v Commissioner for Railways (NSW) [1951] HCA 50; (1951) 83 CLR 521, per Dixon, Williams, Fullagar and Kitto JJ at 534. In Crouch v Commissioner for Railways (Qld) [1985] HCA 69; (1985) 159 CLR 22, Mason, Wilson, Brennan, Deane and Dawson JJ identified, at 35, but did not resolve, the conceptual difficulties involved in the notion that an artificial entity, created by statute, can have both its own capacity and the natural capacity of the natural person officeholder who represents it. Their Honours added:

"It suffices, for present purposes, to emphasize that one must, in the case of a corporation sole, distinguish between the transient natural person who happens to hold the particular office at a particular time and the continuing corporate identity which the law attributes to the office. A particular incumbent of the office is, for so long as he or she holds it, clothed by the law with the personality, powers and functions of the corporate entity. It is the office and not the particular human incumbent which is incorporated however and, even though the powers and functions of the office may lie dormant, the artificial corporate entity does not cease to exist when, by reason of a vacancy, the office lacks visible representation."

324 When Mr Carpenter was engaged in the Negotiations (that is, the negotiations which culminated in the Statement of Principles), he was acting in his capacity as the Minister for State Development and not in his capacity as the Minister administering the Mining Act. The knowledge which he acquired in the course of the Negotiations was not the knowledge of the corporation sole established under s 10(1) of the Mining Act. That body corporate did not have, as one of its functions, the negotiation of amendments to State agreements ratified by other Acts. Accordingly, even if the knowledge of the corporation sole is relevant, it did not have any relevant knowledge concerning the Statement of Principles.

325 Section 11 of the Mining Act provides:

"There shall be a department of the Public Service of the State to assist the Minister in the administration of this Act, to which department there shall be appointed, under Part 3 of the Public Sector Management Act 1994, a chief executive officer and such number of persons to be mining registrars, geologists, surveyors, inspectors and such other officers as may be necessary for the due administration of this Act."

326 The Department, in conducting the Negotiations (through its servants or agents), was assisting the Minister for State Development in the administration of the relevant State Agreement Acts, and was not performing the function of administering the Mining Act, as contemplated in s 11.

327 Neither s 11 of the Mining Act nor the evidence before this Court forms a proper basis for concluding that the persons who engaged in the Negotiations, or who had knowledge of the Negotiations or the content of the Statement of Principles, were under a duty to communicate that knowledge to the Minister administering the Mining Act.

Ground 13(a)(i) - (iii) and ground 13(b): Statement of Principles: in any event, only actual knowledge is relevant

328 In any event, only the actual knowledge (as distinct from corporate or constructive knowledge) of the natural person who is the Minister is relevant in determining whether the Minister has accorded procedural fairness in exercising the discretionary power conferred by s 111A(1)(c) of the Mining Act. Constructive or corporate knowledge is not relevant in determining whether the natural person who is the Minister has accorded procedural fairness. My reasons for the opinions I have expressed are as follows.

329 First, as I have mentioned, fairness is, in essence, a practical concept. It is not abstract in nature. The purpose of the law of procedural fairness is to avoid practical injustice. See Ex parte Lam, per Gleeson CJ at 13 - 14 [37]. The object of the hearing rule is to ensure that a person whose rights might be affected by a decision is given notice of the information on which the decision may be based. See Kioa, where Brennan J observed, at 628:

"A person whose interests are likely to be affected by an exercise of power must be given an opportunity to deal with relevant matters adverse to his interests which the repository of the power proposes to take into account in deciding upon its exercise."

330 Secondly, it would be inconsistent with the status of procedural fairness as essentially a practical concept which is concerned to avoid practical injustice if a decision-maker were required to inform a person whose rights may be affected by a decision of all matters of which the decision-maker had corporate or constructive notice. Plainly, very significant practical difficulties would often arise. It might be impossible for a decision-maker to ensure that procedural fairness had been accorded if the decision-maker's obligation extended to conveying information of which he or she was in fact unaware.

331 Thirdly, s 12 of the Mining Act contemplates that if the exercise of a power or function by the Minister or a delegate of the Minister is dependent upon the opinion, belief or state of mind of the decision-maker, it is the particular opinion, belief or state of mind of the Minister or the delegate (as the case may be) which is relevant. Section 12(1) empowers the Minister, by instrument in writing, to delegate any of his powers or functions (except the power of delegation) to specified persons. The powers which may be delegated include the discretionary power under s 111A(1)(c). Section 12(3)(b) provides that a power or function delegated by the Minister under s 12:

"may, if the exercise of the powers or the performance of the functions is dependent upon the opinion, belief or state of mind of the Minister in relation to a matter - be exercised upon the opinion, belief or state of mind of the delegate in relation to that matter."

332 Fourthly, Cazaly's contention that the Minister was required to inform or cause Cazaly to be informed of information within his corporate or constructive knowledge is inconsistent with the approach of the High Court in Applicant VEAL of 2002, where Gleeson CJ, Gummow, Kirby, Hayne and Heydon JJ said, at 96 [17]:

"... what is 'credible, relevant and significant' information must be determined by a decision-maker before the final decision is reached."

A decision-maker can only make such a determination based on material of which he or she has actual knowledge.

333 Fifthly, decisions such as Peko-Wallsend are distinguishable. They were concerned with a decision-maker's failure to take account of factors which he or she was bound to consider. They were not concerned with procedural fairness. In Peko-Wallsend, Brennan J, in the context of failure to take account of relevant considerations, said, at 66:

"A Minister may retain his power to make a decision while relying on his Department to draw his attention to the salient facts. But if his Department fails to do so, and the validity of the Minister's decision depends upon his having had regard to the salient facts, his ignorance of the facts does not protect the decision."

334 Sixthly, Cazaly's contention is inconsistent with the decision of the High Court in Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Applicants 134/2002 [2003] HCA 1; (2003) 211 CLR 441. Gleeson CJ, McHugh, Gummow, Hayne and Callinan JJ held, at 458 - 460 [34] - [43], that the Refugee Review Tribunal had not denied procedural fairness to the applicants, by failing to disclose material in a department file which showed that the first applicant's husband was in Australia and had obtained a temporary protection visa, because it was unaware of that material and did not rely upon it.

335 Seventhly, Cazaly's contention is inconsistent with the general approach of the majority of the High Court in Hot Holdings (2002). That case was concerned with apprehended bias in relation to Ministerial decision-making. The majority held that, on the premise that the Minister had given a departmental recommendation independent and unbiased consideration, a peripheral involvement in the preparation of the recommendation by officers of the department who might have an interest in the outcome of the matter did not invalidate the Minister's decision. Gleeson CJ observed, at 446 [14], that a passage in the judgment of the court under appeal appeared to attribute a form of vicarious partiality to the Minister which had far-reaching implications. His Honour added:

"Decision-makers, whether administrative or judicial, often act on, or take into account, information or advice that comes to them from sources that are not impartial. It was not argued in this Court that the Minister took into account an irrelevant consideration, or failed to take account of a relevant consideration. That might sometimes be the consequence of receiving advice that is partial; but it is not this case."

Also see the comments of Gaudron, Gummow and Hayne JJ at 455 [50].

336 Finally, in this context, Cazaly's contention is inconsistent with the decision in McLachlan. In that case, a delegate of the Australian Securities and Investments Commission, a body corporate, made a decision after forming a relevant belief. The applicant contended that it should have been given access to all information in ASIC's possession which might be relevant to that belief. The information in question would have been within ASIC's "corporate knowledge", but was not within the actual knowledge of the delegate and was therefore not relied upon by him. The Full Court of the Federal Court rejected the applicant's argument that procedural fairness required the applicant to be given access to all relevant material in ASIC's possession.

Ground 13(a)(i) - (iii): procedural fairness: documents before the Minister

337 Cazaly contends in ground 13(a)(i) - (iii) that the Minister failed to accord Cazaly procedural fairness in making the Decision in that he failed to provide Cazaly with documents and information that the Minister had before him or considered when he made the Decision, including:

"(i) a document entitled or described as a 'Statement of Principles' which is referred to in paragraph 21 of the letter from Rio to the Hon. Alan Carpenter, Minister for Development, dated 21 September 2005 (Rio's First Submission) or an adequate summary of the content thereof;

(ii) documents relating to or evidencing the 'ongoing discussions with [the Minister] over the last 6 months concerning the various State Agreements to which members of the RTIO group of companies are party' referred to in paragraph 21 of Rio's First Submission, including any memos, file notes or reports relating to the discussions or an adequate summary of the content and status of the discussions;

(iii) the letter from the Hon. Alan Carpenter, Minister for Development, to Rio dated on or about 16 December 2005 which was a response to a letter from Rio which enclosed the 'Statement of Principles' referred to in paragraph 21 of [Rio's First Submission] or an adequate summary of the content thereof;"

338 The evidence before this Court does not establish that any of the documents referred to in ground 13(a)(i) - (iii) were before the Minister or otherwise considered by him when he made the Decision. Further, the evidence does not support an inference to that effect.

Ground 13(b): procedural fairness: providing Cazaly with sufficient information as to the case it had to meet

339 For the reasons I have given at [295] - [305] above, Cazaly had sufficient information to understand the substance of par 21 of Rio's First Submission. Cazaly was able to respond to RRJV's submission that the State had a commitment, analogous to that in Concept Nominees, to apply the Rhodes Ridge State Agreement to the land on which the Shovelanna resource was located.

Ground 13(a)(v) and (ix) and ground 13(c): procedural fairness: the Policy

340 In Rio's Third Submission, RRJV raised the Policy in response to Cazaly's contention that the Extension Application should not have been granted even if it had been lodged on time. I have set out, at [129] above, the manner in which the submissions addressed the Policy.

341 On 11 November 2005, Mr Stevens of the Department, had a telephone conversation with Cazaly's solicitor, Mr Edel. Mr Stevens explained the Policy to Mr Edel, and informed him of the reliance which RRJV intended to place on it. In a file note dated 11 November 2005, Mr Edel recorded the telephone conversation, relevantly, as follows:

"[Mr Stevens] said that the major companies such as BHP and Rio would be using the policy as a defence. He said that the policy that had been applied since the 1960's was to give the major companies accommodation in return for their development of the Pilbara iron ore industry. He said that the major's [sic] attitude was that this had gone on for many years and had been an understanding that they had had with Government over many years. He said that they felt that if they had received 11th extension of term [sic] on that basis why shouldn't they receive the 12th extension of term? If the policy was going to be changed then they needed to have notice of it.

He said that when you look at Section 102A of the Mining Act the policy is clearly expressed that iron ore tenements should be given exemptions from expenditure. He said that the majors were arguing that they had made massive decisions in relation to investment on the back of that policy and it would be unfair to change it now.

He said however that the policy was now being reviewed. He said that this started several years ago when the Department had noticed that some junior companies were started [sic] to move into the iron ore sector as a result of higher iron ore prices. He said that the policy review had moved at glacial speed up until about a year ago when FMG had started writing in to the Minister complaining that BHP were being given extensions of term and exemption applications being granted [sic] for no reason. He said that FMG had plainted two tenements which were exploration licences and were asking the Minister not to grant extensions of term or exemptions from expenditure obligations. These were not under any State agreement. BHP got wind of this and applied for mining leases over the area, which FMG has objected to. FMG is objecting on the grounds that it would not be in the public interest to grant the tenements. ...

...

I asked whether it was a Departmental policy rather than a Government policy.

[Mr Stevens] said it was a Departmental policy but one that the government knew about. He said in particular it was a DRD policy. When these renewal applications or exemption forms came in he said that DoIR (the old DME) used to ask DRD whether they had any problem with it. They would said [sic] no and then DME would process the application.

...

He made the point that it only applied outside the State agreement areas. The policy was that the majors had to demonstrate an inferred resource but not more than that. Once an inferred resource had been demonstrated then they could treat the tenement as a 'holding tenement'. When retention licences came in 1994 no-one used them because of native title difficulties. The old policy in relation to iron ore tenements continued.

I asked [Mr Stevens] how he thought the policy would play with Government in the sense that how would Government react to it? He said that he did not know.

He said the policy had been spectacularly successful in helping set up the iron ore industry and keep it running.

I said to him that I did not think it was relevant to the Section 111A issue. He said it wasn't directly relevant but it would come into consideration to the extent that there was an allegation that Rio had not done any work on the tenement. Rio would say 'of course we didn't do any work - we didn't have to because we had an understanding with the Government about these matters'. That understanding had been in place for a long time and if it was going to be changed they should have been given notice of it.

..."

342 By letter dated 9 December 2005, Cazaly's solicitors wrote to the Department in connection with the Policy:

"... we cannot see any basis for the assertion by [RRJV] in its submission dated 21 September 2005 that 'it is probable that, had it been received on time, the application to renew would have been granted'.

By asserting that a renewal application which does not appear to satisfy the Department's guidelines, would probably have been granted, [RRJV] has put the policy and practice of the Department in relation to the renewal of iron ore tenements in issue in the proceedings before the Minister.

We understand that the Department has recently forwarded the Minister a report of a policy or practice adopted by the Department in relation to the favourable treatment of iron ore tenements and exemption and renewal applications in respect thereof.

Cazaly Iron Pty Ltd cannot properly respond to the Rio Tinto submission without knowledge of the Department's policy or practice. [RRJV] as beneficiary of the practice or policy and also the Minister as recipient of the report have knowledge of the policy or practice.

Procedural fairness requires that Cazaly Iron Pty Ltd be similarly informed."

343 On 13 December 2005, Cazaly's solicitors made application on behalf of Cazaly under the Freedom of Information Act for a copy of the Department's report to the Minister in relation to the Policy.

344 On 8 February 2006, Cazaly's solicitors received a copy of the Department's report to the Minister in relation to the Policy. Significantly, Cazaly's solicitors received that document before Cazaly settled and sent Cazaly's Third Submission dated 14 February 2006 to the Department. In Cazaly's Third Submission, Cazaly said that:

"... no further response to the Rio JV's second or third submission is necessary because:

(a) the Rio JV's second and third submissions simply respond to matters raised by Cazaly Iron in its submissions. Cazaly Iron confirms and reiterates all of the points in its first and second submissions and stands by each of them. The documents lodged in support of the submissions, information contained on the public record, and information contained in the records of the Department of Industry and Resources confirm all of the points that Cazaly Iron has made in its submissions; and

(b) the procedure established by the Department of Industry and Resources in relation to Section 111A applications discourages the lodgement of submissions beyond the submission in reply. In the interests of assisting in establishing a manageable process, Cazaly will refrain from lodging any further submissions as Cazaly believes that the 'public interest' is best served by all parties complying with both the Mining Act, 1978 as well as the procedures set in place by the Department of Industry and Resources."

345 At all material times after 11 November 2005, Cazaly appreciated that the Policy was an important matter which the Minister would consider in making the Decision. On 8 February 2006, Cazaly received a copy of the Department's report to the Minister in relation to the Policy. Cazaly had a proper opportunity, in Cazaly's Third Submission dated 14 February 2006, to address, in an informed manner, the content, validity and significance of the Policy. Cazaly chose not to address those issues.

346 It is true that on 11 November 2005, Mr Stevens informed Cazaly's solicitor, Mr Edel, that Cazaly would have an opportunity to see and comment on the Department's Minute before it was sent to the Minister. However, by 2 February 2006, Cazaly understood that it would not be permitted to see or comment on the minute. See the letter dated 2 February 2006 from Cazaly's solicitors to Mr Burton of the Department. The critical point, in this context, is that on 8 February 2006, Cazaly received a copy of the Department's report to the Minister in relation to the Policy, and had a proper opportunity to deal with the Policy in an informed manner.

347 Cazaly's submissions in relation to ground 13(c) are otherwise based on a misunderstanding of the manner in which the Minister considered the Policy. See [237] - [251] above.

Ground 13(a)(v) and (ix): procedural fairness: references to the Policy in the Department's Minute

348 For the reasons I have given at [186] - [190] above, the Department's Minute to the Minister inaccurately reproduced the advice from the Department's legal officer, but the minute did not misstate, in any material respect, the effect of the Policy or its objectives.

349 The advice of the Department's legal officer related to the validity of one aspect of the Policy. The Department's Minute erroneously recorded the advice as referring to the validity of the Policy as a whole.

350 It is true that Cazaly did not have an opportunity to point out to the Minister that the Department's Minute had inaccurately reproduced the advice of the Department's legal officer or that the advice in question was qualified. The loss of that opportunity does not, however, justify granting prerogative or declaratory relief. For the reasons I have given at [132] - [182] above, the relevant parts of the Policy are not inconsistent with the Mining Act and can properly be taken into account by the Minister in exercising the discretionary power under s 111A(1)(c). In those circumstances, there would be no point in granting prerogative or declaratory relief for the purpose of enabling Cazaly to make submissions to the Minister in relation to the Policy and its consistency with the Mining Act which are contrary to my analysis at [132] - [182] above. The grant of relief, in the circumstances I have described, would be futile.

Ground 13(a)(v), (vii) and (ix): procedural fairness: internal submissions

351 Cazaly contends that the Minister failed to accord Cazaly procedural fairness in making the Decision in that the Minister failed to provide Cazaly with documents and information that the Minister had before him or considered when he made the Decision, including:

"(v) a copy of the minute prepared for the Minister by the Department dated 30 March 2006, in relation to [RRJV's] request that the Minister terminate or refuse [Cazaly's Application] pursuant to section 111A(1)(c)(ii) of the Act (Departmental Submission) including all annexures or an adequate summary of the content thereof;

(vii) legal advice provided by the State Solicitors Office to [the Department] dated 1 February 2006 or an adequate summary of the content thereof;

(ix) the memorandum from Ms Anne Seghezzi to Mr Bob Stevens dated 8 February 2006 which was quoted by the Minister on page 2 of the reasons for the Decision which were published on 27 April 2006 or an adequate summary of the content thereof;"

352 In Commissioner for Australian Capital Territory Revenue v Alphaone Pty Ltd [1994] FCA 1074; (1994) 49 FCR 576, the Full Court of the Federal Court explained the application of procedural fairness in the context of the entitlement of a person likely to be affected by the exercise of a statutory power to put information and submissions to the decision-maker. The Full Court said, at 591 - 592:

"Where the exercise of a statutory power attracts the requirement for procedural fairness, a person likely to be affected by the decision is entitled to put information and submissions to the decision-maker in support of an outcome that supports his or her interests. That entitlement extends to the right to rebut or qualify by further information, and comment by way of submission, upon adverse material from other sources which is put before the decision-maker. It also extends to require the decision-maker to identify to the person affected any issue critical to the decision which is not apparent from its nature or the terms of the statute under which it is made. The decision-maker is required to advise of any adverse conclusion which has been arrived at which would not obviously be open on the known material. Subject to these qualifications however, a decision-maker is not obliged to expose his or her mental processes or provisional views to comment before making the decision in question."

353 In Ex parte Palme, the prosecutor sought certiorari and prohibition in relation to the Minister's decision to cancel the applicant's visa. The prosecutor complained, relevantly, that he had been denied the opportunity to see, comment on, and answer a departmental submission given to the Minister before he made his decision. In particular, the prosecutor contended that he had not had the opportunity to see how the submission "distilled" the relevant material and commented on it. The Departmental submission set out the relevant facts and policy considerations. The last page of the submission gave the Minister four options, and the Minister recorded his decision by crossing out three of them. Gleeson CJ, Gummow and Heydon JJ said, at 219 [21]:

"... it does not readily appear how the principles of procedural fairness could be engaged in the manner contended for by the prosecutor. It may be accepted, as the prosecutor submitted, that his entitlement extended to the rebuttal of, and comment by way of submission upon, adverse material received by the decision-maker from other sources. That stops short of supporting a complaint of the nature essentially involved here of the "pitch" or 'balance' in the statement of relevant considerations in the Submission. Further, as indicated above, there is no substance in any complaint of unfair or prejudicial 'lack of balance'."

McHugh J held, at 228 [59], that, for the reasons given in the joint judgment of Gleeson CJ, Gummow and Heydon JJ, there was no substance in the prosecutor's contention that he had been denied procedural fairness.

354 When a Minister, in making a decision, relies on information from his or her Department, the Minister is obliged, before making the decision, to disclose the information to any person who may be adversely affected by the decision, and to give that person an opportunity to be heard in respect of the relevant information, if it:

(a) raises new matters in respect of which the person affected has not, in substance, previously been heard; and

(b) might materially influence the Minister's decision-making in a manner adverse to the person affected.

See Kioa per Mason J at 587; Re Minister for Mines; Ex parte Roberts per Steytler J at 418.

355 In my opinion, the aspects of the advice received by the Minister from the Department and the State Solicitor's Office, which are referred to by Cazaly, did not raise any new matter in respect of which the Minister was required to give Cazaly an opportunity to be heard. The issues relating to the content and application of the Policy, and the proper construction and application of s 111A of the Mining Act, had been raised in earlier correspondence between Cazaly and the Department or in earlier submissions by RRJV. Cazaly had either made submissions on the relevant issues or had been given an opportunity to be heard in relation to them. Procedural fairness did not require that the Minister give Cazaly a further opportunity to be heard on the aspects of the advice received by the Minister from the Department or the State Solicitor's Office, which Cazaly has identified.

(a) For the reasons I have given at [190] and [348] - [350] above, the inaccurate reproduction of the advice from the Department's legal officer does not justify the grant of relief.

(b) As to the introductory comment in the Department's Minute, that comment must be read in the context of the analysis of s 111A later in the minute, where the contentions of Cazaly and RRJV, and the advice of the State Solicitor's Office, are set out. Cazaly had previously made comprehensive submissions on this issue.

(c) As to Cazaly's allegation that the State Solicitor's Office advised the Minister that it was sufficient for the Minister to be satisfied that "there is some public interest to be advanced" by terminating Cazaly's Application, that contention does not accurately describe the substance of the relevant advice. The advice was, in substance, that the Minister's discretionary power under s 111A(1)(c) was not enlivened unless some public interest was identified. The sentence complained of by Cazaly must be evaluated in the context of the paragraph in which it appears and the advice as a whole. When that is done, it is apparent that the advice was distinguishing between the private interest of RRJV on the one hand and the public interest on the other, and informing the Minister that unless the matters raised by RRJV could properly be characterised as involving the public interest, they could not justify the exercise of the Minister's discretion under s 111A(1)(c).

357 In my opinion, the Department's Minute and the advice from the State Solicitor's Office presented the Minister with balanced advice on the issues, and left to the Minister the identification of any relevant public interest considerations and the decision whether to exercise his discretion under s 111A(1)(c) and terminate Cazaly's Application.

Ground 13(a)(ix): procedural fairness: the meeting

358 On or between about 6 and 8 September 2005, there was a meeting in London between Mr Carpenter and the Chief Executive Officer of Rio Tinto Limited, Mr Leigh Clifford. Some details in relation to that meeting were mentioned by Mr Carpenter in the radio interview on 27 April 2006 with Ms Mellet. A transcript of the interview records, relevantly:

" ...

GERALDINE MELLET: How much of this is your decision?

ALAN CARPENTER: It's not my decision. What happens there ... what happened is that the incidents around which the decision has been made occurred in August last year. There was immediately some level of correspondence from the ... from Rio to the Department. Once all the correspondence and the objections from the ... from Rio and the counter position from Cazaly had come forward, they then exchanged with each other, so that each can comment on the other's position. When all that's come through, it's aggregated and provided to the Minister and that was given to John, not me. John ...

GERALDINE MELLET: But in the time that you were responsible, did you actually have meetings with Rio Tinto?

ALAN CARPENTER: No.

GERALDINE MELLET: You had no discussions with Rio Tinto?

ALAN CARPENTER: Yeah, well the day that I found out about it, I was actually in Rio's office in London. I was on a visit to Europe for the Offshore Europe Oil and Gas Conference, and as part of that pre-arranged schedule I was visiting the Rio office. And that was the day, as I understand it, my recollection, that was the day that Lee [sic] Clifford (*), the Rio Tinto CEO found out about it as well.

GERALDINE MELLET: What did he say to you?

ALAN CARPENTER: He just told me what had happened and that it would be a matter of some contention. I said, well, my responsibility, as I recall, my responsibility in this matter will be to act properly and fairly and I will. And that's where we left it."

359 Cazaly submitted that the matters discussed at the meeting were credible, relevant and significant to the Decision. Cazaly also submitted that there was "a significant likelihood" that the Minister acquired "some knowledge" of the matters discussed at that meeting, in that:

(a) on 3 February 2006, Mr Bowler became the Minister Assisting the Minister for State Development;

(b) on 3 February 2006, Mr Bowler replaced Mr Carpenter as the Minister administering the Mining Act;

(c) Mr Bowler replaced Mr Carpenter, as the Minister responsible for deciding whether to terminate Cazaly's Application, during the course of the decision-making process; and

(d) it is "likely" that Mr Roberts was aware of the matters discussed at the meeting because he was an adviser to Mr Carpenter, and there is evidence that Mr Bowler consulted Mr Roberts before making the Decision.

360 Counsel for the Minister submitted that it was not open, in the circumstances, to infer that Mr Bowler acquired knowledge of the matters discussed at the meeting. In particular, it was submitted:

(a) First, Mr Bowler was not the Minister Assisting the Minister for State Development before 3 February 2006. The office of Minister for Resources and Assisting the Minister for State Development was only created when Mr Bowler was appointed on 3 February 2006. Before that time, Mr Bowler was Minister for Local Government and Regional Development, Sport and Recreation, Land Information, Goldfields - Esperance and Great Southern.

(b) Secondly, the assertion that the fact of appointment as Minister carried with it knowledge of all conversations which the former Minister had, was without merit.

361 Senior counsel for RRJV supported the Minister's submissions on this issue. Senior counsel contended, on their behalf, that:

(a) no reasonable inference could be drawn from the evidence that any "adverse information" was conveyed by Mr Clifford to Mr Carpenter at the meeting; and

(b) no reasonable inference could be drawn from the evidence that the content of any of the discussions between Mr Clifford and Mr Carpenter was conveyed, directly or indirectly, to Mr Bowler.

362 In my opinion, the submissions made on behalf of the Minister and RRJV are correct. According procedural fairness, in the context of Ministerial decision-making, does not require, as a matter of fairness or good public administration, that a Minister be deemed to have constructive knowledge of everything within the knowledge of his Ministerial predecessors. It would also be impractical and inconvenient in that it is not unusual for Ministers to come and go and for changes of government to occur. Further, there is no evidence before this Court that there was any conversation between Mr Clifford and Mr Carpenter, in relation to the possible termination of Cazaly's Application, beyond the brief exchange mentioned by Mr Carpenter during the radio interview. The transcript of the interview records, relevantly, that:

(a) the meeting between Mr Carpenter and Mr Clifford was arranged before they became aware of RRJV's loss of the Expired Licence and Cazaly's Application;

(b) Mr Clifford informed Mr Carpenter of the events relating to the loss of the Expired Licence and Cazaly's Application, and that there would be a dispute in relation to those events; and

(c) Mr Carpenter informed Mr Clifford that he was obliged, as the responsible Minister, to act properly and fairly, and he would do so.

There is no evidence that any further or other matters were discussed at the meeting in relation to the loss of the Expired Licence, Cazaly's Application or the request "foreshadowed" by RRJV in its letter dated 2 September 2005 that Mr Carpenter exercise his discretion under s 111A(1)(c)(ii) of the Mining Act to terminate Cazaly's Application. There is no evidence that Mr Carpenter's account of his conversation with Mr Clifford, or the circumstances in which it occurred, is incomplete or inaccurate.

363 It is not established that any matters were discussed between Mr Carpenter and Mr Clifford at the meeting which were credible, relevant or significant to the Decision. Further, it is not made out that a hypothetical fair-minded person who is properly informed as to:

(a) the statutory context and decision-making structure in relation to s 111A(1) of the Mining Act;

(b) the matters to be decided in relation to whether Cazaly's Application should be terminated pursuant to s 111A(1)(c)(ii); and

(c) the objective facts, disclosed in the evidence, concerning the meeting,

might reasonably apprehend, by reason of those matters, that Mr Carpenter, or his successor as the Minister responsible for the administration of the Mining Act, might not bring an independent and impartial mind to the making of the decision in question. On the evidence, there was nothing in the conversation between Mr Clifford and Mr Carpenter which should have been communicated to Cazaly to enable it to make a correction or contradiction or to make submissions.

365 I would discharge the order nisi and refuse declaratory relief.