CH4 Pty Ltd v The Minister for Natural Resources, Mines and Energy and Minister for Trade [2010] QLC 37 (2010) 31 QLCR 52

LAND COURT OF QUEENSLAND CITATION: CH4 Pty Ltd v The Minister for Natural Resources, Mines and Energy and Minister for Trade [2010] QLC 37 PARTIES: CH4 Pty Ltd (applicant) v. The Minister for Natural Resources, Mines and Energy and Minister for Trade (first respondent) and Tonya Mitchell (second respondent) FILE NO: PGP105-09 DIVISION: General Division PROCEEDING: Interlocutory application for determination on a point of law and declaration on that point DELIVERED ON: 12 March 2010 DELIVERED AT: Brisbane HEARD AT: Brisbane MEMBER: Mr PA Smith ORDER: 1. The Court makes the following Declarations: a) Ch 6 of the Uniform Rules applies to the proceedings with necessary changes; b) The Originating Application, the Response and the Reply to the Response (and any amendments thereto) constitute the pleadings for the purposes of the proceedings. 2. The Court declines to make the other Declarations as sought by the applicant. CATCHWORDS: Interlocutory Application – Practice and Procedure – Pleadings – Nonadmissions - Chapter 6 of the Uniform Civil Procedure Rules 1999 – Rules 4, 19 of the Land Court Rules 2000 - ss. 827 and 828 of the Petroleum and Gas (Production and Safety) Act 2004 -- 1 of 9 -- 2 Natural Justice and Procedural Fairness – s.7 of the Land Court Act 2000 - s.827 (c) Petroleum and Gas (Production and Safety) Act 2004 APPEARANCES: Ms K O’Gorman for the applicant Mr A. Horneman-Wren SC and G Handran for the first nd second respondents SOLICITORS: Hopgood Gamin for the applicant GR Cooper, Crown Solicitor, for the first and second respondents BACKGROUND [1] This is an interlocutory application brought by the applicant, CH4 Pty Ltd, to determine a question of law: Does Chapter 6 of the Uniform Civil Procedure Rules 1999 (UCPR) apply to the pleadings before the Court? [2] The applicant seeks a declaration from the Court that: (a) The provisions of Chapter 6 of the Uniform Rules apply to the proceedings; (b) The Originating Application, the Response and the Reply to the Response (and any amendments thereto ('the documents') constitute the pleadings for the purposes of the proceedings; (c) Insofar as facts are admitted (whether expressed, implied or deemed) in the documents, those facts are to be regarded as not being in issue and do not need to be proven by the parties in the course of the proceedings; and (d) The parties may adduce evidence directed only to the allegations which are in issue (as defined by the Uniform Civil Procedure Rules ('The UCPR')) as set out in the documents.1 [3] Counsel for the first and second respondents, The Minister for Natural Resources, Mines and Energy and Minister for Trade, and Tonya Mitchell, agrees that there are pleadings before the Court but contends that they are pleadings to which the UCPR does not apply, or should not be applied, in this application on alternative grounds: (a) Properly interpreted, the Land Court Rules do not provide that the UCPR pleadings rules apply to this application; (b) Should it be found that the Land Court Rules do apply the pleading rules to this application, the application of those rules is not to the effect asserted by the applicant, or sought by it in this application. 1 From the pleadings of the applicant at paragraph 12. -- 2 of 9 -- 3 (a) The nonadmissions contained in the response are, to the extent the UCPR applies, properly pleaded such that no deemed admissions arise; and (b) The contention urged by the applicant proceeds on a false premise as to the construction and operation of r.165(4) of the UCPR.2 WHAT IS A PLEADING? [4] A definition of pleading can be found in the Supreme Court Act 1995: "pleading includes any petition or summons and includes the statements in writing of the claim or demand of any plaintiff and of the defence of any defendant thereto and of the answer of the plaintiff to any set-off or counterclaim of a defendant." [5] In other words, pleadings are formal written documents exchanged by the parties to litigation in which they set out the material facts which they allege and intend to prove at the hearing of the action. The primary intention of pleadings is to limit the scope of particulars.3 WHAT DO THE UNIFORM CIVIL PROCEDURE RULES 1999 (UCPR) SAY WITH REGARD TO PLEADINGS? 1. Pleadings in a statement of claim [6] When a Plaintiff files and serves a claim (originating application) under the UCPR pleadings must also be filed and served in the form of a statement of claim (r.22(b)). 2. Pleadings in a defence [7] The Defendant can choose whether or not to defend the claim. As a defence is not mandatory, the only pleadings that are required are those attached to the originating process. If the Defendant chooses to defend the claim they must file and serve a notice of intention to defend the claim and their pleadings (their defence) must be attached (rr.134- 144). The Defendant can also attach a counterclaim, which contains pleadings (rr. 175, 164, 182, 178) to the defence. [8] If the Defendant does not provide a notice of intention to defend and a defence within 28 days after the claim is served, the Plaintiff can apply for a default judgment (r.137, 139). 2 From the pleadings of the respondent at paragraphs 27-28. 3 With reference to the definition by Cairns, Bernard Australian Civil Procedure, 6th Edition (2005) at 159. -- 3 of 9 -- 4 3. Pleadings in a reply [9] Any reply by the Plaintiff to a Defendant’s defence or any answer to the Defendant's counterclaim must be filed and served within 14 days after the day of the service of the defence (unless the court orders otherwise) (r.164). A reply is a form of pleading. 4. Close of pleadings [10] Pleadings close on service of the reply or 14 days from service of the defence (r.169). The court may extend or shorten time under these rules by order of the court (r.7). [11] Pleadings cannot be amended after the close of pleadings without leave of the court. This leave is given subject to common law principles.4 5. Nonadmissions in pleadings [12] A party who pleads a nonadmission cannot give or call evidence in relation to a fact not admitted, unless the evidence relates to another part of the party’s pleadings (r.165). The party has a continuing obligation to the court to make reasonable inquires into the matter that is not admitted and must apply to amend their defence if they find out through those inquiries that it is proper to admit or deny the allegation. A party who makes an unreasonable nonadmission may have additional costs awarded against them caused by the denial or nonadmission (rr.166-167).5 [13] Here the applicant has alleged nonadmissions have occurred but has not given any details, specifics or facts relating to those alleged nonadmissions. Any submissions the applicant wishes to make on nonadmissions must be particularised and presented in relation to the relevant material facts of the case before the Court. [14] The respondent is reminded of the ongoing duty to the court to make reasonable inquiries into any nonadmissions (r.166(6)) and to apply to amend their response if they find out through those inquiries that it is proper to admit or deny the allegation. 4 Parties can request leave of the Court to amend pleadings. While pleadings are binding at trial, (Banque Commerciale SA (Enliq) v Akhil Holdings Ltd (1990) 169 CLR 279) courts have tended to favour merits over procedure when considering amendments (Queensland v JL Holdings P/L (1997) 189 CLR 146). But note Rigato Farms Pty Ltd v Ridolfi [2001] 2 Qd R 455 [2000] QCA 292 per de Jersey, CJ: “Parties do not have an inalienable right to a hearing of all issues on the merits”. Also note that recently Queensland v JL Holdings P/L was limited in the High Court by Aon Risk Services Australia Limited v Australian National University [2009] HCA 27 5 August 2009 C1/2009 creating a higher threshold for giving reasons when applying for amendments to pleadings especially where amendments could cause unreasonable delay to the court process. 5 With reference to the definition by Cairns, Bernard Australian Civil Procedure, 6th Edition (2005) at 185-186. -- 4 of 9 -- 5 WHAT DO THE LAND COURT RULES 2000 SAY ON PLEADINGS AND THE UCPR? [15] As both parties have agreed, pleadings have been filed in the Court for the purpose of the hearing.6. The parties disagree on whether chapter 6 of the UCPR applies to those pleadings. [16] Chapter 6 applies to proceedings started by a claim (r145 UCPR). An originating application in the Land Court is to be treated as though it were a claim under the UCPR.7 [17] Rule 4 of the Land Court Rules 2000 states: "4 Application of Uniform Civil Procedure Rules (1) If these rules do not provide for a matter in relation to a proceeding in the court and the Uniform Civil Procedure Rules 1999 (the uniform rules) would provide for the matter, the uniform rules apply in relation to the matter with necessary changes. (2) For subrule (1), an originating application under these rules is to be treated as if it were a claim under the uniform rules." [18] Following the introduction of the UCPR in 1999, there have been a number of decisions concerning the interpretation of rule 4 of the Land Court Rules 2000. [19] In Royal National Agricultural and Industrial Association of Queensland (RNA) v Chief Executive, Department of Natural Resources and Mines QLC (AV00-570), unreported decision 6 June 2001 at pages 2-3, the learned Member said: "By way of initial background, it is of interest to note the observations on the new Land Court Rules in the recent decision of Chief Executive, Department of Natural Resources and Mines v. Sabina Three Gorges Corporation case (12 April 2001): "These Rules read as a whole, communicate a comprehensive statutory structure which together with the Uniform Civil Procedure Rules 1999 which complement the Land Court Rules 2000 create a system for the pre-trial conduct of matters before the Court. In the case of the respondent's appeals, those Rules were relied upon and orders issued on 16 November 2000 with a view to exposing and narrowing the issues and in ensuring that neither party would be caught by surprise. This position may be contrasted with the position that obtained prior to the new Rules coming into effect where there were many occasions when success for one party depended to some extent on its capacity to ambush the other, the prevailing Rules being quite inadequate with respect to case management. In the circumstances of the enactment of the new Rules it must be appreciated by parties coming before the Court that, particularly in instances where parties are represented, the Court will be astute to utilise the Rules of the Court and to expect the parties to comply with orders made in reliance on the Rules." While the Minister's Second Reading Speech in introducing the Land Court Act 2000 does not refer to the precise issue in question here, it does provide certain guidance. It states that the Act provides the basis for the new Rules of the Court which are intended to provide for a stream-lined system of court-supervised case management and a range of pre-hearing steps." 6 See transcript at 13.38, 13.57 and 43.00 minutes. 7 Rule 4(2) Land Court Rules 2000. -- 5 of 9 -- 6 [20] A further example of the application of rule 4 can be taken from Dawson v Department of Natural Resources and Mines [2003] QLAC 0023: "[12] As noted by the learned Member, neither the Land Court Act 2000 nor the Land Court Rules 2000 confer power on the Land Court to strike out proceedings as sought by the respondent. However, Rule 4 of the Land Court Rules is to the effect that if the Rules do not provide for a matter in relation to a proceeding in the Court and the Uniform Civil Procedure Rules 1999 (the Uniform Rules) do so, then the Uniform Rules apply in relation to the matter with necessary changes. In these circumstances, the learned Member therefore considered that the Land Court has the power given to the Supreme Court in Rule 171 to strike out a pleading if the pleading discloses no reasonable cause of action. [13] After carefully considering each of the appellant's so-called "grounds of appeal", the learned Member concluded in respect of each one of them that they did not constitute a ground of appeal. On that basis, the learned Member concluded that the appeal should be struck out because it disclosed no reasonable grounds of appeal…" [17] … As mentioned earlier, the learned Member relied on Rule 4 of the Land Court Rules, for authority to consider whether the Uniform Rules provided for a matter where the Land Court Rules did not. We note that subrule (2) of Rule 4 states that: "For subrule (1), an originating application under these rules is to be treated as if it were a claim under the uniform rules." [18] Although many Statutes which confer jurisdiction on the Land Court, including s.51 of the Water Resources Act 1989 in the present case, provide for “an appeal to the Land Court", the only means of starting proceedings in the Land Court is by filing an originating application: Rule 7. The precise form of originating application required in such circumstances is contained in Form 3 of the Land Court Forms. [19] It is our view that where Rule 4(1) of the Land Court Rules is applicable, under Rule 4(2) an originating application must be treated as if it were a claim under the Uniform Rules. Therefore, in our view, the appeal in this case is a "claim", not an "appeal", for the purposes of applying the Uniform Rules. If this is so, there is no doubt that at any stage in a proceeding, the Court may allow a party to amend a claim in the way and on conditions the Court considers appropriate: Rule 375." [21] It follows that the interpretation of rule 4 of the Land Court Rules (that the UCPR must apply where the Land Court Rules are silent, with necessary changes) must require chapter 6 of the UCPR to apply to pleadings in the Land Court, as there are no relevant provisions in the Land Court Rules which specifically apply to pleadings. There is nothing in rule 19 of the Land Court Rules which excludes the operation of rule 4 of the Land Court Rules. [22] The logic of this construction follows from an examination of rule 14 of the Land Court Rules which allows a respondent to apply to end a proceeding early if there is a failure by the applicant to prosecute proceedings. The Land Court Rules are however silent as to how an applicant can apply for default judgment if the respondent fails to defend an application or otherwise ceases its continued defence of an action. Therefore in those circumstances the default judgment provisions of the UCPR must apply. -- 6 of 9 -- 7 IS THE UCPR APPLICABLE TO MERITS REVIEW OF A DECISION OF A MINISTER IN A DE NOVO HEARING? [23] The Land Court is a merits review court and as such the following general principles arise from the Land Court Act 2000 section 7: 1. The Land Court exercises merits review where it has jurisdiction to do so. 2. The Land Court may exercise discretion with regard to the substantial merits of the case without regard to legal technicalities and forms or the practice of other courts (s.7). The jurisdiction to do so comes under s.7 of the Land Court Act 2000. Division 2 General powers 7 Land Court to be guided by equity and good conscience In the exercise of its jurisdiction, the Land Court— (a) is not bound by the rules of evidence and may inform itself in the way it considers appropriate; and (b) must act according to equity, good conscience and the substantial merits of the case without regard to legal technicalities and forms or the practice of other courts. [24] In this instance this merits review jurisdiction comes under ss.827 and 828 of the Petroleum and Gas (Production and Safety) Act 2004 (The P & G Act). 827 Hearing procedures (1) In deciding an appeal, the appeal body— (a) has the same powers as the original decider; and (b) is not bound by the rules of evidence; and (c) must comply with natural justice; and (d) may hear the appeal in court or in chambers. (2) An appeal is by way of rehearing, unaffected by the decision. (3) Subject to subsections (1) and (2), the procedure for the appeal is— (a) in accordance with the rules for the appeal body; or (b) in the absence of relevant rules, as directed by the appeal body. (4) A power under an Act to make rules for the appeal body includes power to make rules for appeals under this part. 828 Appeal body’s powers on appeal (1) Subject to section 829, in deciding an appeal, the appeal body may— (a) confirm the decision; or (b) set aside the decision and substitute another decision; or (c) set aside the decision and return the issue to the original decider with the directions the appeal body considers appropriate. -- 7 of 9 -- 8 (2) If the appeal body substitutes another decision, the substituted decision is, for this Act, other than this chapter, taken to be the decision of the original decider. [25] Under merits review, the merits of the decision both in law and factual evidence as well as the proprietary of policy can be looked at afresh; the purpose of merits review is to determine whether the decision for which review is sought is “correct & preferable”; and merits review can make the decision de novo, ss. 827, 828 P & G Act: see Drake v Minister for Immigration and Ethnic Affairs (1979) 2 ALD 60. [26] In a merits review jurisdiction the parties must still be afforded procedural fairness which is an aspect of natural justice (s.827 (1) (c) P & G Act); see also Sullivan v Department of Transport (1978) 20 ALR 323; Australian Postal Commission v Hayes (1989) 87 ALR 283; Minister for Immigration and Ethnic Affairs v Pochi (1980) 31 ALR 666. [27] Section 7 of the LCA is the overarching principle of the Court as propounded in many Land Court and Land Appeal Court decisions and upheld in the Court of Appeal in the case of Townsville City Council & Anor v Department of Main Roads [2005] QCA 226 per McMurdo P, Keane JA, White J. [28] This does not mean that the principles of natural justice and procedural fairness are dispensed with. Rather, as stated in a recent decision by then Member Jones in Body Corporate for Parklands CTS and Anor v. Department of Natural Resources and Water [2009] QLC 0065 at paragraph 18 paraphrasing Cox v. Commissioner of Water Resources (1992) 14 QLCR 304 (LAC): "The equity and good conscience provisions do not empower the Land Court or the Land Appeal Court to ignore established principles of law or to dispense justice other than in accordance with basic principles of natural justice to all parties." [29] Member Jones goes on to say: "…it must be stressed that I am not attempting to formulate a test or rigid formula applicable to all applications brought in the Land Court. Each must be dealt with on its own facts, circumstances and merits…The force and effect of s.(7) of the LCA must not be construed in such a way as to limit the flexibility Parliament intended the Land Court to have in the exercise of its jurisdiction. However, in applications such as this and in many other cases no doubt, hearsay evidence, if admitted, runs the real risk of unfairly advantaging one party and disadvantaging the other. That is so because the evidence cannot be adequately challenged or otherwise tested." [at 21-22] [30] In summary, the Land Court can exercise discretion with regard to the formal rules of procedure. Each case, however, must be dealt with on the merits and will turn on the individual facts and circumstances of the case. In the particular circumstances of this matter, the Court would need to be shown compelling reasons, based on clear and unambiguous facts, why the technical UCPR outcomes for deemed admissions should be applied, rather than further refinement and amendment of the pleadings, if appropriate. -- 8 of 9 -- 9 As no relevant material facts have been presented to the Court on the alleged nonadmissions, the Court can make no finding on the merits of this issue. Order: 1. The Court makes the following Declarations: (a) Ch 6 of the Uniform Rules applies to the proceedings with necessary changes; (b) The Originating Application, the Response and the Reply to the Response (and any amendments thereto constitute the pleadings for the purposes of the proceedings. 2. The Court declines to make the other Declarations as sought by the applicant. PA SMITH MEMBER OF THE LAND COURT -- 9 of 9 --