Bunbury Treefarm Project Agreement Act 1995

The central legal construct is the Agreement, defined in section 3 of the Act as the document in Schedule 1, including any variations made in accordance with its provisions. The Agreement is a contract between the State and three entities collectively called “the Joint Venturers”. The term “Project” is defined in clause 1(1) of the Agreement as “the establishment and maintenance of large scale commercial hardwood plantations of up to 20,000 hectares in the aggregate in the Bunbury Region for the purpose of producing woodchips for export”. The “Bunbury Region” is itself tightly defined: land within a 120 kilometre radius of the Bunbury General Post Office, with a long term average rainfall greater than 600 millimetres per annum, and where the State granted an estate in fee simple absolute prior to 1975. This definition restricts eligible land to freehold titles issued before 1975, which effectively excludes Crown land or land granted after that date.

The “Timber Sharefarming Agreements” are central to the project structure. Recital B explains that the Executive Director of the (then) Department of Conservation and Land Management (CALM) would act as agent for the Joint Venturers under a Deed of Agency and Indemnity (the AI Deed). The Executive Director would enter into timber sharefarming agreements under section 34B of the Conservation and Land Management Act 1984 (the CALM Act) and also take leases, licences, options, or arrange purchases of land. The sharefarming model means the Executive Director manages the plantations on behalf of the Joint Venturers, using statutory powers that would not be available to a private entity. The State’s role is to provide security and facilitation: the Agreement contains seven undertakings by the State (clause 5) that bind the State during the term, including promises not to expropriate timber, not to impose discriminatory taxes, not to obstruct transportation or processing, and to make representations to the Commonwealth for export licences. The term “discriminatory taxes rates or charges” in clause 5(b) is not defined but targets taxes aimed specifically at the project. The Agreement also allows for variation by mutual agreement, subject to a parliamentary disallowance procedure (clause 6). The applicable law is Western Australian law, and the parties submit to the exclusive jurisdiction of WA courts (clause 8). The Act itself does not alter the contractual nature of the Agreement; it merely ensures that no State law can override its terms unless that law explicitly amends or repeals this Act.

The Act directly binds the State of Western Australia and the three Joint Venturers: Nippon Paper Treefarm Australia Pty Ltd, Mitsui Plantation Development (Australia) Pty Ltd, and MCA Afforestation Pty Ltd. The Joint Venturers are jointly and severally liable for all obligations (clause 1(2)). The Act also affects the Executive Director of the Department of Conservation and Land Management (now the Department of Biodiversity, Conservation and Attractions), who is required under the AI Deed and the sharefarming agreements to act as agent for the Joint Venturers in acquiring land and managing plantations. The Act restricts the discretion of State agencies and local governments. Clause 5(c) prohibits the State from discriminating against the Joint Venturers in processing applications relating to timber production, which may affect how local councils handle development approvals or vegetation clearing permits within the Bunbury Region. Clause 5(e) prohibits the State from materially obstructing timber production operations or transportation, which could constrain road authorities, police, or environmental regulators. The Act does not directly affect private landowners, but the sharefarming model requires them to enter agreements with the Executive Director. The land must be freehold granted before 1975, so the Act implicitly favours older farming properties. Exporters and port operators may be affected by clause 5(d), which prevents the State from imposing export restrictions on wood chips from the project - though export controls are primarily a Commonwealth matter. Taxpayers bear the cost of any forgone revenue from discriminatory taxes or charges the State has promised not to impose, as well as any administrative costs of defending the Agreement in court or in Parliament if a variation is disallowed. Competitors of the Joint Venturers, particularly other treefarm or woodchip exporters not covered by such an agreement, face a competitive disadvantage because the Joint Venturers have legislative protection from future policy changes. The Act does not affect the general public in a direct regulatory sense, but it does remove the usual avenue of challenging State actions by arguing they are ultra vires or inconsistent with another Act, since the Agreement takes effect “despite any other Act or law”.

Duties of the State. Clause 5 imposes seven binding undertakings on the State during the term of the Agreement. The State must not expropriate or confiscate timber or wood chips (clause 5(a)). It must not impose or permit discriminatory taxes, rates, or charges on the timber sharefarming agreements, leases, licences, timber, or wood chips (clause 5(b)). It must not discriminate in processing the Joint Venturers’ applications for activities related to timber production (clause 5(c)). It must not impose restrictions preventing export of wood chips (clause 5(d)). It must not materially obstruct timber production operations or transportation (subject to safety considerations) (clause 5(e)). It must make representations to the Commonwealth for any necessary export licences or consents (clause 5(f)). It must not cause the Executive Director to breach the AI Deed, the timber sharefarming agreements, or the leases or licences (clause 5(g)). Additionally, clause 2 imposes a duty on the State to introduce and sponsor the Bill and endeavour to secure its passage by 31 December 1995 (or a later agreed date). The State also has a procedural duty under clause 6(2) to cause any variation agreement to be laid before Parliament within twelve sitting days.

Duties of the Joint Venturers. The Joint Venturers must ensure the Project does not exceed 20,000 hectares in aggregate, with a sub-cap of 7,000 hectares within eight named shires (clause 4(1)). They must comply with and observe all Western Australian laws in their operations (clause 4(2)). This is a significant obligation: the Agreement does not exempt them from complying with environmental, workplace, or planning laws. The State’s undertakings protect them from discriminatory or obstructive State action, but general laws still apply. The Joint Venturers also have a right to propose variations under clause 6(1), but any variation requires State agreement and is subject to parliamentary disallowance.

Rights of the State. The State has the right to see the Agreement operate as a boost to development and exports, as stated in Recital C. It can terminate the Agreement when the Joint Venturers cease to have rights under the underlying agreements, or on 30 June 2030, whichever is earlier (clause 7). The State also has the right to disallow variations by resolution of either House of Parliament (clause 6(3)).

Rights of the Joint Venturers. The Joint Venturers have the benefit of the seven undertakings, which are enforceable as contractual rights. They can also request the State to make representations to the Commonwealth. They can seek to vary the Agreement, and they can bring proceedings in Western Australian courts for any breach.

No rights for third parties. The Act does not confer any rights on private landowners, local governments, or members of the public to enforce the Agreement or challenge its operation.

The Act itself does not prescribe any criminal penalties, civil fines, or infringement notices for breach of its provisions or for breach of the Agreement. Enforcement is left to the ordinary law of contract. If the State breaches any of its undertakings under clause 5, the Joint Venturers may sue for damages, specific performance, or an injunction. Conversely, if the Joint Venturers fail to comply with laws (clause 4(2)) or exceed the hectare caps (clause 4(1)), the State could seek contractual remedies, but the Act does not automatically void any part of the Agreement for breach. Because the Act ratifies the Agreement and gives it effect despite other laws, a court would treat the Agreement as having force akin to statutory provisions. This might make it harder for a private party to challenge State actions that are consistent with the Agreement but otherwise unlawful under other Acts. The Joint Venturers could rely on section 4(3) to argue that a later State law is overridden by the Agreement. The State’s most powerful enforcement tool is the expiry of the Agreement, which will happen on 30 June 2030 regardless of performance (unless the Joint Venturers cease earlier). The Agreement does not contain a liquidated damages clause or any specific arbitration mechanism - only clause 8 provides for the exclusive jurisdiction of Western Australian courts. This means that any dispute could be litigated in court, with the usual costs and delays. The parliamentary disallowance procedure under clause 6(3) acts as a political check on variations, but it does not create a legal penalty. The Act does not provide for any public enforcement body to monitor compliance; enforcement is purely between the parties. If the State fails to make representations to the Commonwealth (clause 5(f)), the Joint Venturers’ only recourse is to sue. In practice, the State’s exposure to a large damages claim from a major foreign investor may be a stronger deterrent than any legal penalty.

Section 4(3) is the pivotal interaction provision: “the Agreement operates and takes effect despite any other Act or law”. This overrides inconsistent State laws, but it does not purport to override Commonwealth laws (which would be beyond State constitutional power). The subsection also says this override is “without limiting or otherwise affecting the application of the Government Agreements Act 1979”. That Act provides a framework for State agreements and also gives them force despite other laws. The Government Agreements Act 1979 would apply automatically to any agreement that meets its definition, but the express inclusion here confirms that the Bunbury Treefarm Project Agreement is valid under that Act as well. The interaction with the Conservation and Land Management Act 1984 (the CALM Act) is complex. Recital B and clause 5(g) refer to that Act and to agreements made under it. The Executive Director’s powers under sections 33(1)(f), 34A(1)(d), (g), (h) and 34B of the CALM Act are the statutory basis for the sharefarming and leasing arrangements. The Act does not amend the CALM Act; it merely ratifies the Agreement which uses those provisions. However, section 4(3) would mean that if any other Act (such as a future environmental protection law) purported to restrict the Executive Director from performing the sharefarming agreements, the Agreement would prevail. The interaction with local government laws is also affected: local authorities are “instrumentalities” of the State under clause 5(b) and (e), so State undertakings prohibit the State from authorising discriminatory rates or obstruction. But the Joint Venturers must still comply with local laws that are not discriminatory or objectively obstructive. The Act does not interact with Commonwealth laws such as the Environment Protection and Biodiversity Conservation Act 1999 or export control laws. The State’s undertaking to make representations (clause 5(f)) is not a guarantee that the Commonwealth will grant licences. There is no interaction with the Native Title Act 1993 or Aboriginal heritage laws; the Agreement is silent on those matters, so they continue to apply. The Standardisation of Formatting Act 2010 made a minor amendment to the heading in Schedule 1 but did not change substance.

The Act has been amended only once since enactment. The Standardisation of Formatting Act 2010 (No. 19 of 2010), section 4, amended the heading of Schedule 1 by adding a note: “[Heading amended: No. 19 of 2010 s. 4.]”. This was a purely cosmetic change to standardise formatting across legislation; it did not alter any substantive provision. The original Act was passed as No. 51 of 1995 and received royal assent on 21 November 1995, commencing on that day as per section 2. The compilation table shows a reprint as at 2 May 2003, but no amendments were made then. There have been no substantive amendments to sections 1-4 or to any operative part of the Agreement in Schedule 1. The Act has not been amended to extend the 30 June 2030 expiry date, despite the original Agreement being for a term up to that date. The variation clause (clause 6 of the Agreement) could theoretically be used to extend the term, but any such variation would be subject to parliamentary disallowance under clause 6(3). The Act itself contains no amendment mechanism other than variation of the Agreement followed by the disallowance procedure. Section 3 defines “the Agreement” to include the Agreement as varied from time to time in accordance with its provisions, so a variation that is not disallowed takes effect without further amendment to the Act. Therefore, the Act’s amendment history is effectively null - the only formal legislative change was the formatting alteration in 2010. The lack of substantive amendment over nearly 30 years suggests either that the project has operated without need for change, or that any variations have been minor and not disallowed. Since the Agreement expires in 2030, further amendments are unlikely unless the parties seek to vary before then.

The Act and the Agreement have generated no reported litigation in Western Australian courts. There are no published judgments interpreting section 4(3) or any provision of the Agreement. The compilation table and notes contain no references to court decisions. This does not mean no disputes have arisen - the parties may have resolved them privately through negotiation or arbitration, or the State may have complied with its undertakings to avoid litigation. The exclusive jurisdiction clause (clause 8) is standard. The absence of litigation may also reflect the relatively small scale of the project compared to major State agreements such as those in the North West Shelf or gas projects. The Joint Venturers are Japanese corporates that would likely prefer to avoid public court battles. Any future litigation could involve claims by the Joint Venturers for breach of State undertakings (e.g., if a future government imposed a carbon tax or land clearing restriction that discriminated against the project). Alternatively, a third party such as a local council or environmental group could seek to challenge an action by the Executive Director as being beyond power under the CALM Act, but the shield of section 4(3) would defeat a claim based on inconsistency with another State Act. A challenge based on the Government Agreements Act 1979 might succeed if the Agreement fails to meet that Act’s requirements, but that is unlikely given the express reference. The Act’s long period without court action suggests that both parties have found the commercial terms workable, but readers should be aware that the legal effect of section 4(3) has never been tested. Any future litigant would need to consider whether the Act is itself subject to the Constitution Act 1889 or whether it can be impliedly repealed - standard principles of statutory interpretation would allow a later Act expressly overriding this one to prevail, but the Act specifically says the Agreement operates despite other Acts, so a later Act would need to be explicit.

1. No sunset on State undertakings. The State’s undertakings in clause 5 continue until the Agreement expires, not until the Joint Venturers cease operations. Even if the Joint Venturers hold land but are not actively producing timber, the State is still bound not to impose discriminatory taxes or obstruct transportation. This could constrain future governments from applying a broad‑based environmental levy or carbon price that happens to fall disproportionately on woodchip exports.

2. “Despite any other Act or law” is broad. Section 4(3) overrides future Acts and regulations, local laws, and even instruments made under other Acts. A local council could be forced to grant a permit that would otherwise be refused under a town planning scheme if refusal would materially obstruct operations. The breadth of this provision has not been tested in court.

3. Exclusive Western Australian jurisdiction. Clause 8 submits the parties to the exclusive jurisdiction of WA courts and WA law. This may be a trap for the Joint Venturers: they cannot sue the State in another state or country. It also means that if a dispute involves a Commonwealth law, the WA court must apply both State and federal law, which could create complexity.

4. Variation disallowance risk. Clause 6(3) allows either House to disallow a variation agreement. If the Joint Venturers negotiate a variation with the State, it does not take effect until after 12 sitting days without disallowance. A political campaign could persuade a minority of MPs to disallow, killing the variation. There is no mechanism for the Joint Venturers to compel the State to renegotiate.

5. No force majeure or hardship clause. The Agreement does not excuse performance for events beyond control. If Commonwealth export controls are tightened, the State’s only obligation is to make representations - not to guarantee export approval. The Joint Venturers remain bound to comply with WA laws (clause 4(2)), even if those laws change in a non‑discriminatory way. For example, a general native vegetation clearing ban that applies to all landowners would not be discriminatory but would effectively halt the project.

6. Term expires 30 June 2030. The Joint Venturers cannot assume the Agreement will be renewed. The Act does not provide for extension, and any extension would require a new Bill or a variation that survives disallowance. The State has no obligation to negotiate an extension.

7. 20,000 hectare limit is absolute. Even if the Joint Venturers have planted only 10,000 hectares and have options on more land, they cannot exceed the cap. The cap includes land under sharefarming agreements, leases, and licences. There is no mechanism to increase the cap without a variation, which is subject to disallowance.

8. “Bunbury Region” definition may exclude suitable land. The requirement that the State granted an estate in fee simple absolute prior to 1975 means land granted after that date (including many subdivisions) is ineligible. Land within 120 km of Bunbury but with rainfall under 600mm per annum is also excluded. This definition is fixed and cannot be varied without a variation.

9. Joint and several liability. Clause 1(2) makes each company liable for all obligations. If one Joint Venturer breaches the Agreement, the State can sue any or all of the others. This is standard but may be overlooked by the smaller entity.

10. CALM Acts amendment could affect agency arrangements. The executive Director’s powers under the CALM Act could be amended. If the State later repeals or restricts those powers, it could cause a breach of clause 5(g) (State must not cause Executive Director to breach the AI Deed or sharefarming agreements). This could expose the State to damages.

Compliance with this Act is essentially compliance with the Agreement. For the State, compliance means honouring the seven undertakings in clause 5. Practically, this requires all government departments, agencies, and local councils to be aware that they cannot take any action that would breach those undertakings. The State should maintain an internal register of approvals, permits, and tax assessments related to the Joint Venturers’ operations to ensure no discriminatory treatment. The Minister must table any variation agreement within 12 sitting days. The State should also ensure that the Executive Director (or successor agency) does not act inconsistently with the AI Deed or the sharefarming agreements. For local governments within the Bunbury Region, compliance means that they must not impose conditions that would materially obstruct the Joint Venturers’ operations (e.g., restricting truck movements on roads used for timber transport, or charging higher rates for plantations than for other similar rural uses). However, local governments are still entitled to apply general rates that apply equally to all landholders; the prohibition is only on discriminatory rates.

For the Joint Venturers, compliance requires: (a) ensuring total Project area never exceeds 20,000 hectares, with a sub‑cap of 7,000 hectares in the named shires; (b) complying with all Western Australian laws in force from time to time, including environmental, workplace health and safety, road transport, and water extraction laws; (c) ensuring that all land acquired or used falls within the Bunbury Region definition (within 120 km of Bunbury GPO, rainfall >600 mm, freehold granted pre‑1975); (d) maintaining the timber sharefarming agreements, leases, and licences in good standing; (e) if they wish to vary the Agreement, negotiating with the State and accepting the parliamentary disallowance procedure; and (f) bringing any disputes exclusively in Western Australian courts. The Joint Venturers should also keep careful records of all representations made by the State to the Commonwealth regarding export licences, as this is a State obligation. They should also monitor State legislation and regulations for any new laws that might indirectly discriminate (e.g., a carbon tax on land clearing that applies only to plantations but not to traditional farming). If such a law is passed, the Joint Venturers can rely on section 4(3) and clause 5(b) to challenge it.

Both parties should ensure that any variation agreed under clause 6 is reduced to writing and executed with the same formalities as the original Agreement. The variation will not be effective until the disallowance period has passed without a resolution of disallowance. If either House resolves to disallow, the variation is void and the original terms remain. The parties cannot circumvent this by using a side letter that purports to amend the Agreement without using the clause 6 process.

The simplest way to comply is to treat the Agreement as a stable framework: the State provides the security, the Joint Venturers comply with general laws and respect the hectare caps. Because the Act gives the Agreement force despite other laws, any person challenging a State action that is consistent with the Agreement will need to show that either the action is not discriminatory, or that it falls outside the Agreement’s scope. The absence of litigation suggests compliance has been straightforward. However, as the 2030 expiry approaches, parties should consider whether to negotiate a variation or extension, which will require careful management of the disallowance procedure. But as of the current text, no variation has been published, and the Act remains as enacted in 1995 with only a formatting change.