Citigold Corporation Limited v Chief Executive, Department of Environment & Heritage Protection [2015] QLC 10 (2015) 36 QLCR 34

LAND COURT OF QUEENSLAND CITATION: Citigold Corporation Limited v Chief Executive, Department of Environment & Heritage Protection [2015] QLC 10 PARTIES: Citigold Corporation Limited (applicant) v Chief Executive, Department of Environment & Heritage Protection (respondent) FILE NO: EPA055-15 DIVISION: General Division PROCEEDING: Application for a stay DELIVERED ON: 13 March 2015 [Ex tempore] DELIVERED AT: Brisbane HEARD ON: 13 March 2015 HEARD AT: Brisbane MEMBER: PA Smith ORDER: Stay granted on condition of provision of a bank guarantee by the applicant to the respondent in the amount of One Million Dollars ($1,000,000) with formal orders to be jointly provided to the Court by 18 March 2015. CATCHWORDS: Practice and procedure – stay of proceedings – Environmental Protection Act 1994 s 535 – application of relevant principles – Cougar Energy Limited v Debbkie Best, Chief Executive under EP Act – exceptional circumstances – ultimate orders fully effective – irreparable prejudice if not granted – conditional stay for specific period granted Environmental Protection Act 1994, ss 295, 535 Cougar Energy Limited v Debbkie Best, Chief Executive (2011) QPEC 150 -- 1 of 6 -- 2 APPEARANCES: Ms KJ McIntyre of Counsel for the applicant, Citigold Corporation Limited Ms A Ireland Lawyer for the respondent, the Department of Environment and Heritage Protection. [1] The Court has before it an appeal against a decision of the Chief Executive, Department of Environment and Heritage Protection made pursuant to s 295 of the Environmental Protection Act 1994 (EP Act) regarding the amount and form of financial assurances payable by the applicant in respect of its Charters Towers gold project. [2] The appeal by Citigold was filed in the Land Court on 23 February 2015. Subsequently on 5 March 2015 Citigold filed a general application by which it seeks, pursuant to s 535(1) of the EP Act, that the original decision be stayed pending the outcome of the appeal. It is the question of whether or not a stay should be granted to which this decision relates. [3] I have before me three affidavits, being an affidavit of Matthew Martin for Citigold and affidavits of Anne-Marie Kate Ireland and Samuel Alexander Hedge for the Chief Executive. The affidavit material, particularly that of Anne-Marie Ireland, gives some brief history of a previous matter before the Land Court involving the same parties and the same environmental authority and the same issue for determination, although it is conceded by Ms Ireland for the Chief Executive that there are some factual differences between the appeal in the current matter and the appeal in the previous matter. However, despite those differences, I consider it remains a relevant question as to the manner in which the appeal was progressed by Citigold in the previous matter. [4] In this regard, it can be said in general terms that Citigold was often late in the filing of various steps in the proceedings and that a relatively considerable period of time elapsed from the commencement of the appeal to the time in which the appeal was to be determined. That action was subsequently discontinued on the filing of the amended plan of operations by Citigold, which of course led to a new assessment under the EP Act and led, ultimately, to the new appeal. It is thus clear that there is an interrelationship between the two matters. [5] By its reckoning Citigold contends that the amount of financial guarantee should be in the sum of $587,000, including monitoring fees and GST. The material indicates that the Chief Executive currently holds cash in the amount of $492,304 as a financial assurance from the applicants pursuant to the environmental authority. The Chief Executive has assessed the financial assurance that it considers is appropriate by a notice decision on 27 November 2014, which assessed the sum at $12,509,000. -- 2 of 6 -- 3 [6] It is, therefore, apparent that there is a great deal of difference between the quantum contended for by the appellant and by the chief executive. I note in the affidavit of Mr Martin that Mr Martin says that a payment of $12,509,000 at this time would place a temporary and unexpected financial pressure on Citigold, such that it may impact on an interim basis on Citigold’s operations and Citigold’s ability to generate sustained cash flow from gold production. [7] I also accept, as Mr Martin says, that should Citigold fail to pay the amount of financial assurance assessed by the respondent it is likely to face enforcement action which may include the suspension of the environmental authority and therefore the ability of Citigold to obtain income from the exploration and mining activities undertaken pursuant to the environmental authority. I have no doubt that this is of serious concern to Citigold. [8] The factors which I have to take into account in determining whether or not a stay should be granted have been well summarised by Jones DCJ in the case of Cougar Energy Limited v Debbkie Best, Chief Executive under the Environmental Protection Act 1994,1 where Judge Jones had this to say at paragraph 20: “ [20] Notwithstanding that these proceedings involve an appeal against what is effectively an administrative decision, it is generally agreed that the general principles associated with the granting of a stay in usual civil litigation are applicable, subject to some variation or adjustment where necessary. By reference to cases such as Cook Construction Pty Ltd v. Stork Food Systems Australasia Pty Ltd (2008) Qd R 453; Alexander v. Cambridge Credit Corporation Ltd (1985) 2 NSWLR 685; and Attorney for the State of Queensland v. Farden (2011) QCA 111, the following principles seem to be established: (1) It is not necessary for the Applicant for a stay to show special or exceptional circumstances which warrant the grant of a stay. (2) The fundamental justification for granting a stay pending an appeal is to ensure that the orders which might ultimately be made by the Court are fully effective. (3) While the prospects of success on the appeal are a relevant consideration, unless it can be said that the appeal is frivolous or not arguable, the Court will generally not descent into a detailed assessment of the prospects of the appeal. (4) Finally, will the Applicant for the stay be irreparably prejudiced if the stay is not granted.” [9] Ms Ireland for the Chief Executive agrees with the submissions of Ms McIntyre for Citigold as to the impact of the considerations which have to be taken into account by the Court as to whether or not a stay should be granted in the current circumstances, and in particular those points as set out by Judge Jones. Further, Ms Ireland concedes that the prospects as put out by Citigold in its notice of appeal are arguable. The key issues come down to the question of the effectiveness of the appeal; the impact of any payment on Citigold; and a question of Citigold’s timeliness in conducting the current appeal. 1 (2011) QPEC 150. -- 3 of 6 -- 4 [10] Ms Ireland has contended that a condition of any stay should be that the appeal be progressed quickly and that a hearing date appear in not longer than six months from now, with a financial guarantee in support of the stay of a figure of, perhaps, two or three million dollars. [11] Ms McIntyre has indicated from Citigold’s perspective that an appeal could be heard by the end of this year, which is a time period of approximately nine months and that the appellant, Citigold, is prepared to make a financial contribution of $587,000, being the amount that it considers properly payable. This is of course an amount of approximately $95,000 in excess of the amount that is currently held by the Chief Executive. [12] I am concerned regarding issues of delay in payment of previous accounts provided by the Chief Executive to Citigold with respect to this environmental authority, which for the last four years has resulted in the imposition of late fees by the Chief Executive. I also note that the late fees are of very small magnitude in light of the overall amounts that we are referring to in this matter. The most recent late fee, being only the sum of $118.20 out of a total payment of $99,316. I also note that Citigold has no current outstanding fees relating to EPML00556713, being the relevant environmental authority in this matter. [13] Having taken all of the matters before me into consideration, there is clearly a balance which needs to be met in this matter. On the one hand, there is clear benefit to the state in having Citigold continue its operations and the relevant benefits which flow to the state by way of royalties and employment from their gold exploration and mining operations. However, there is also an important role played by the Chief Executive in ensuring that the environment of the State is protected in circumstances where a holder of an environmental authority may, for one reason or another, walk away from a project, thus leaving, for want of a better terms, a mess for the state government to have to clean up. [14] This Court has certainly had previous cases before it where other companies have failed to properly rehabilitate their land, thus causing difficulties for the Chief Executive and the people of Queensland in the resultant environmental harm caused by mining activities and an imposition of costs on the State in having those disturbed areas properly rehabilitated. -- 4 of 6 -- 5 [15] Part of the mining area of Citigold is in an area referred to as Black Jack, in which there is a landholder agreement in place; however, approximately 10 per cent of the area of Black Jack is USL – that’s unallocated State land – and therefore unable to be subject to a landholder agreement. This would, of course, have an impact upon the figure of $580,000 that Citigold considers is appropriate and no doubt result in that figure going up somewhat; however, I only have scant details as to what impact the increased amount would have on the overall figure. [16] Granting a stay at this time is a matter of discretion and it is also, if granted, a concession to Citigold. I do consider it appropriate, particularly given the concessions made by Ms Ireland, that a stay should be granted; however, I believe that a stay should be granted for a specific period of time only, and in that regard, the appropriate time for a stay will be operative until midnight on 31 December 2015, save for further order of the Court. [17] I also consider it appropriate that an amount of at least the amount that Citigold considers is appropriate to be paid should be paid to the Chief Executive at this time. As I have indicated, on one set of figures, that is approximately $95,000 more than Citigold has currently paid and, by its best case, is an amount which it should pay for the financial guarantee; however, to this needs to be added at least an amount that reflects the 10 per cent of USL on Black Jack, but I have no way of properly determining how such sum should be calculated. [18] Further, Ms Ireland says that the minimum amount is insufficient and should, in fact, be a matter of some two or three million dollars, as previously indicated. [19] Doing the best that I can in all the circumstances of this matter and exercising my discretion, I consider it appropriate to order, as an interim measure pending the determination of the appeal in this matter, that Citigold pay, by way of bank guarantee, a sum of $1,000,000, less the amount of $492,304 currently held by the Chief Executive, resulting in a net amount of $507,296 to the Chief Executive as a condition of the grant of the stay in this matter. [20] I direct the appellant and the respondent to produce orders reflective of this ex tempore decision jointly by 4.00pm 18 March 2105. [21] I would also give an indication for the preparation of this matter for hearing of the appeal. The parties should proceed for their preparations for the directions hearing to be held later this month on the assumption that the appeal will be heard in early December with the likelihood being a week at least, commencing 7 December 2015. I note from Ms McIntyre that at least five days will be required. I appreciate that at this stage, it is impossible to be precise as to the amount of time required. I also understand my own -- 5 of 6 -- 6 diary and the difficulty in having time set aside, so for the purposes of this matter, I will have a period of two weeks from 7 December 2015 held open in my diary and a courtroom available in the Land Court for the hearing of this matter with directions to flow later this month, commensurate with having the matter heard and determined within that time frame for hearing. That concludes the reasons for decision. PA SMITH MEMBER OF THE LAND COURT -- 6 of 6 --