BM Alliance Coal Operations Pty Ltd v Michael Scully, Inspector Resources Safety & Health Queensland [2021] ICQ 1

INDUSTRIAL COURT OF QUEENSLAND CITATION: BM Alliance Coal Operations Pty Ltd v Michael Scully, Inspector Resources Safety & Health Queensland [2021] ICQ 001 PARTIES: BM Alliance Coal Operations Pty Ltd (Applicant) v Michael Scully, Inspector Resources Safety & Health Queensland (Respondent) CASE NO: C/2021/2 PROCEEDING: Application for stay DELIVERED ON: 14 January 2021 HEARING DATE: 14 January 2021 MEMBER: HEARD AT: O'Connor VP Brisbane ORDERS: Pursuant to s 178 of the Coal Mining Safety and Health Act 1999 (Qld), the Directive given to the Applicant on 12 January 2021 is stayed until: a) the Directive is set aside or withdrawn; b) 14 days after the Applicant receives reasons for the Chief Inspector's decision with respect -- 1 of 9 -- 2 to the Applicant's application for review; or c) further order of this Court. CATCHWORDS: COAL MINING SAFETY AND HEALTH - REVIEW OF DIRECTIVE - INTERLOCUTORY APPLICATION - APPLICATION FOR STAY OF OPERATION OF DIRECTIVE - whether jurisdiction to order stay pursuant to s 178 of the Coal Mining Safety and Health Act 1999 - whether stay should be ordered - whether the applicant has an arguable case - whether the balance of convenience is in favour of the application - whether there is a risk of the review being abortive without the stay. LEGISLATION: CASES: Coal Mining Safety and Health Act 1999, s 166, s 167, s 168, s 169, s 175, s 178 Alexander v Cambridge Credit Corporation Ltd (1985) 2 NSWLR 685 Bucyrus Australia Surface Pty Ltd v McFadzen [2010] ICQ 52 Construction, Forestry, Mining & Energy Union & Lyne & Anor [2005] 2 Qd R 378 George v Rockett (1990) 170 CLR 104 Ninemia Maritime Corp v Trave GmbH & Co KG [1984] 1 All ER 398 Patterson v BTR Engineering (Aust) Ltd (1989) 18 NSWLR 319 APPEARANCES: Mr B. McMillan, Counsel instructed by Mr A. Anderson for the Applicant. Mr P. Wilson, Counsel instructed by Ms S. Payne for the Respondent. -- 2 of 9 -- 3 Reasons for Decision (ex tempore) [1] The Applicant, BM Alliance Coal Operations Pty Ltd ("BMA"), is the operator of the Saraji Coal Mine ("the Mine"). [2] On Tuesday 12 January 2020, Mr Michael Scully, Inspector of Mines, Central Queensland issued a Directive pursuant to ss 168 and 169 of the Coal Mining Safety and Health Act 1999 (Qld) ("the Act") requiring the Applicant to:1 (a) review the safety and health management system (SHMS) for the Mine in as far as it relates to the use of mobile plant at a time when Level 3 of the BMA Coal Lightning TARP has been reached, and make the SHMS effective; and (b) suspend operations, namely the operation of mobile plant in all areas that may be impacted by lightning, at all times that Level 3 of the TARP has been (and remains) reached, until the Applicant has complied with the requirements of the Directive issued under section 168 of the Act. [3] A reasonable time for compliance was set. The stated time for compliance is 16 February 2021. [4] The Directive relevantly states: I reasonably believe that the SHMS for the mine is ineffective on the basis that it does not provide for adequate management of risk to safety and health in relation to the operation of the mine in all situations involving lightning. … I believe that the SHMS for the mine is ineffective because it does not provide a system for the management of all aspects of risk to safety and health in relation to the operations of the mine…arising in each of the following circumstances: 1. Hazards arising where Level 3 of the Lightning TARP is reached may result in the Emergency Response Team ("the ERT") being prevented from or delayed in performing its functions. Prevention or delay in the performance of the ERT's functions presents a risk to the safety and health of coal mine workers, namely the risk of injury. 2. Equipment failure on mobile plant that is being operated at a time when Level 3 of the Lightning TARP has been reached may result from a direct or indirect lightning strike. This presents a risk to safety and health as a loss of control of mobile plant that is being operated (resulting from equipment failure) may result in coal mine workers, including the operator of the mobile plant and others, being exposed to the risk of injury. 3. Operators of mobile plant may be distracted by noise, flash or debris resulting from direct or indirect lightning strikes. This presents a risk to safety and health as a loss of control of mobile plant that is being operated (resulting from distraction) may result in coal mine workers, including the operator of the mobile plant and others, being exposed to the risk of injury. 1 Affidavit of Michael Scully affirmed 14 January 2021, Exhibit N; Trigger Action Response Plan ("TARP"). -- 3 of 9 -- 4 4. Mobile equipment may be directly or indirectly struck by lightning. This presents a risk to safety and health as operator of the mobile equipment is exposed to injury arising from electric shock., 5. When mining activity is taking place, operators of mobile plant must have access to two- way radio communication. The use of this equipment during a lightning event presents a risk to safety and health as the operator of the mobile equipment is exposed to injury arising from electric shock or burns. [5] On 13 January 2021, the Applicant made an application to the Chief Inspector pursuant to s 175 of the Act for Internal Review of the Directive. The Chief Inspector has 21 days in which to consider the application for review. [6] On the same day, the Applicant made a further application to the Industrial Court for a stay of operation of the Directive in accordance with s 178(1) of the Act. This section relevantly provides: 178 Stay of operation of directive (1) If a person applies under this division for a directive to be reviewed, the person may immediately apply to the Industrial Court for a stay of the directive. (2) The court may stay the directive to secure the effectiveness of the review and any later appeal to the court. (3) A stay— (a) may be given on conditions the court considers appropriate; and (b) operates for the period fixed by the court; and (c) may be revoked or amended by the court. (4) The period of a stay must not extend past the time when the chief inspector reviews the directive and any later period the court allows the person to enable the person to appeal against the decision. (5) An application made for a review of a directive affects the directive, or the carrying out of the directive, only if the directive is stayed. (6) However, a directive under section 167 must not be stayed. [7] The Respondent opposes this application for stay. Stay application principles [8] The principles governing the exercise of a discretionary power to stay were enumerated by the New South Wales Court of Appeal in Alexander v Cambridge Credit Corporation Ltd.2 Those principles can be summarised as follows: 1. The onus is upon the applicant to demonstrate a proper basis for a stay which will be fair to all parties. 2. The mere filing of an appeal does not demonstrate an appropriate case or discharge the onus. 3. The court has a discretion involving the weighing of considerations such as balance of convenience and the competing rights of the parties. 4. Where there is a risk that the appeal will prove abortive if the appellant succeeds and a stay is not granted, courts will normally exercise their discretion in favour of granting a stay. 2 (1985) 2 NSWLR 685, 50 - 52. -- 4 of 9 -- 5 5. The court will not generally speculate upon the appellant's prospect of success, but may make some preliminary assessment about whether the appellant has an arguable case, in order to exclude an appeal lodged without any real prospect of success simply to gain time. Consideration [9] It is accepted that the onus is upon the Applicant to demonstrate a proper basis for a stay which will be fair to all parties; and the mere filing of an appeal does not of itself demonstrate an appropriate case or discharge the onus. [10] Let me briefly turn to the balance of other factors identified in Alexander v Cambridge Credit Corporation Ltd.3 Arguable case on the merits [11] The Court must be satisfied the Applicant has an arguable case. A "good arguable" case is "one which is more than barely capable of serious argument, and yet not necessarily one which the judge believes would have a better than 50 per cent chance of success".4 It is a less stringent test than requiring proof on the balance of probabilities.5 [12] The grounds relied upon by the Applicant in the application for internal review are: (a) the Inspector had no proper basis to issue the Directive; (b) the issuing of the Directive involved an error of law; and (c) the issuing of the Directive is an improper exercise of power as relevant considerations were not taken into account. [13] The Applicant contends that the Directive does not: (a) contain any explanation for how the Respondent formed the reasonable belief that the nominated circumstances pose an unacceptable risk to safety and health or in what respect the current SHMS for Saraji is ineffective in managing the risk;6 (b) identify any factual basis to support the purported belief that the nominated circumstances pose a risk to safety and health of coal mine workers or any evidentiary basis for the assertion that the SHMS does not adequately address those risks; and (c) disclose a proper basis upon which the Respondent could have formed the purported belief that the SHMS does not adequately address those risks. [14] Accordingly, the Applicant submits the Directive does not disclose a proper basis upon which the Respondent could have formed the reasonable belief that the SHMS was ineffective. 3 (1985) 2 NSWLR 685. 4 Ninemia Maritime Corp v Trave GmbH & Co KG [1984] 1 All ER 398, 404. 5 Patterson v BTR Engineering (Aust) Ltd (1989) 18 NSWLR 319, 325. 6 George v Rockett (1990) 170 CLR 104, 115-116. -- 5 of 9 -- 6 [15] The Respondent submits that it is apparent from the face of the Directive that the specific issues identified by the Inspector are clearly particularised and in sufficient detail. In that regard, the Inspector has established a basis upon which he formed his reasonable belief. [16] The Respondent relies on the decision of Hall P in Bucyrus Australia Surface Pty Ltd AND Allen McFadzen (Bucyrus)7 in support of the argument for the appropriate use to be made of s 178 of the Act. His Honour wrote:8 On the materials before me, I am quite unable to determine the adequacy of safety arrangements on the site. It must be remembered that the Stay is being sought of an order made by a Public Officer in an administrative way. The proper challenge is by way of the Review proceedings with an Appeal to this Court if the Review proceedings fail to resolve the issues between the parties. It is not an appropriate use of the power at s. 178 of the Act for this Court to introduce a system under which Directives do not take effect until after the Appeal by hearing de novo. [17] Bucyrus involved a slightly different set of circumstances. Notwithstanding that his Honour had expressed concern in relation to the use of s 178, he went on to issue the Stay on the basis that receipt of a Risk Assessment was imminent. Absent further consideration of the reasoning adopted by his Honour, I do not, with respect, accept his decision and therefore I decline to follow it. [18] The Applicant further contends that on a proper interpretation of s 169 of the Act, the phrase "may give a directive suspending operations in all or part of the mine" is framed in the present tense and only authorises an inspector to give a direction to immediately suspend operations upon the inspector forming the requisite belief that the SHMS for the Mine is ineffective. [19] The Respondent relies on the decision of Construction, Forestry, Mining & Energy Union & Lyne & Anor.9 [20] In that case, the CFMEU contended that, in relation to any given part of a mine, a Directive cannot require the cessation of some activities but permit others to continue. It argued that the suspension of operations in any part of the mine can only involve the cessation of each and every activity which is part of mining operations. However, the Chief Inspector argued that his Directive is consistent with s 167 of the Act upon its proper interpretation. In the alternative, the Chief Inspector contended that it was a valid Directive given under s 166 of the Act. Each of these arguments were supported by Anglo Coal (Grasstree Management) Pty Ltd, which was effectively the operator of the mine. [21] The main issue before McMurdo J was the correct interpretation of s 167; that was the argument that was brought to his Honour's attention and upon which he ruled:10 It can be seen that coal mining operations include activities of a kind which might occur regardless of whether coal is then being extracted, processed or treated. In particular, the activities of installing 7 [2010] ICQ 52. 8 Ibid [6]. 9 Construction, Forestry, Mining & Energy Union & Lyne & Anor [2005] 2 Qd R 378. 10 Ibid [13], [14]. -- 6 of 9 -- 7 and maintaining equipment used for extraction, processing and treatment are themselves amongst those which are coal mining operations as defined. Within the power to suspend coal mining operations, there is a power to suspend activity of any of the kinds by which the term “coal mining operations” is defined. But the unacceptable risk may be the result of one such activity and not of others, so that the cessation of that activity could remove an unacceptable risk without the need to stop other activities. The activity creating the unacceptable risk could be the extraction of coal and the cessation of that activity could permit, for example, the activity of the maintenance of equipment to be safely conducted. The equipment would remain of a kind which is “equipment used for extraction” whilst not in active use. Yet according to the applicant’s argument, no person would have the power to direct the cessation of coal extraction without requiring all other activities, including the installation or maintenance of equipment used for extraction to cease also. It seems unlikely that such an effect of the statute was intended. In many cases, it would require a disproportionate response to a problem which is specific to a particular activity. In addition, there could be a case where a coal mine would be safer for allowing or indeed requiring a certain activity to occur. In the example just given, it might be within the power under s 166 to require that the equipment to be installed or repaired, but there would then be an inconsistency between that directive and one under s 167 whereby all activities, including the installation or maintenance of equipment, are to cease. Plainly a person exercising the power under s 167 may distinguish between operations according to in which part of the mine an operation would occur. The question is whether there is a power to distinguish between operations according to the kind of activity. Because of the way in which “coal mining operations” is defined, it is possible to speak of some operations continuing whilst others do not; the cessation of one activity would not affect the nature of other activities as coal mining operations. Had s 167 been expressed in terms of a power to “suspend any or all operations”, it would be compatible with the definition of coal mining operations. The question is whether s 167 should be read as if it was in those terms. In my view it should be so read. [22] It is not the time for this Court to speculate about the prospects of success of the matters outlined by the Applicant as the basis for its application for review. It is sufficient for present purposes to be satisfied, as I am, that the Applicant has demonstrated that it has a "good arguable" case. Balance of Convenience [23] The balance of convenience is the course most likely to achieve justice between the parties pending resolution of the internal review; bearing in mind the consequences to each party of the grant, or refusal, of the stay. [24] In making my decision, I am acutely aware of the Respondent's statutory obligation for ensuring the health and safety of people on a coal mining site. In this case, it is attempted to be achieved in particular by protecting workers and other persons against harm to their health, safety and welfare through the elimination or minimisation of risks arising at a time when a Level 3 BMA Coal Lightning TARP has been reached. [25] In that regard, my attention was drawn to an incident on 17 December 2020 at a different mine site to illustrate the potential risk. However, as it became apparent through argument before the Court, the identified risk may not necessarily be addressed by the current Directive. There was, I believe, some acceptance of the fact that the Directive on its face was therefore ambiguous in this regard. -- 7 of 9 -- 8 [26] I have considered the affidavit material before the Court. In particular, the affidavit of Mr IIiffe who deposes to the operational and safety implications should the stay not be granted: 20. I also understand that the Directive requires BMA to cease operating mobile plant in working areas exposed to the risks of lightning at the Mine as soon as the risk of the lightning hazard reaches Level 3 in the BMA Coal Lightning TARP until a review of the SHMS for the Mine is conducted in accordance with the Directive issued under section 168 of the CMSH Act. 21. The ceasing of mobile plant operations at Level 3, in compliance with the Directive, will impose a significant operational and safety burden on BMA as operator of the Mine, and significant burden on myself as SSE being responsible for giving effect to the operational changes. 22. I understand that the Directive requires that BMA cease operating "all mobile plant", which includes emergency response vehicles, once the hazard of lightning reaches level 3. On my assessment, this requirement has the effect of increasing risk of serious injury or death to persons who may need emergency response support in the event of a Level 3 Lightning event. [27] In addition, I have considered the existing arrangements in place to deal with these types of events as expressed in the documents annexed to Mr Iliffe's affidavit. [28] The granting of the stay does nothing to dismiss or lessen the obligation placed on BMA to comply with its statutory obligations under the Act. [29] In assessing the balance of convenience, I think that there is some merit in the argument advanced by the Applicant that absent the stay, the review may prove abortive. [30] On balance, I have formed the view that the balance of convenience favours the granting of this application. Conclusion [31] I accept that the Applicant has discharged the requisite onus of establishing that there is a proper basis for the granting of a stay. I am persuaded that this is an appropriate occasion on which I ought to exercise my discretion to grant a stay. Accordingly, the application is granted. Orders Pursuant to s 178 of the Coal Mining Safety and Health Act 1999 (Qld), the Directive given to the Applicant on 12 January 2021 is stayed until: a) the Directive is set aside or withdrawn; b) 14 days after the Applicant receives reasons for the Chief Inspector's decision with respect to the Applicant's application for review; or c) further order of this Court. -- 8 of 9 -- 9 -- 9 of 9 --