MINERALOGY PTY LTD -v- CITIC LIMITED [2026] WASCA 118

[2026] WASCA 118 Page 1 JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA TITLE OF COURT : THE COURT OF APPEAL (WA) CITATION : MINERALOGY PTY LTD -v- CITIC LIMITED [2026] WASCA 118 CORAM : QUINLAN CJ VAUGHAN JA SEAWARD JA HEARD : 4 JUNE 2026 DELIVERED : 4 JUNE 2026 PUBLISHED : 25 AUGUST 2026 FILE NO : CACV 55 of 2025 BETWEEN : MINERALOGY PTY LTD Appellant AND CITIC LIMITED First Respondent KOREAN STEEL PTY LTD Second Respondent SINO IRON PTY LTD Third Respondent -- 1 of 19 -- [2026] WASCA 118 Page 2 ON APPEAL FROM: Jurisdiction : SUPREME COURT OF WESTERN AUSTRALIA Coram : LUNDBERG J File Number : CIV 3024 of 2017 Catchwords: Appeals – Practice and procedure – Leave to appeal from orders as to costs only – No issue of principle – Leave to appeal refused Legislation: Rules of the Supreme Court 1971 (WA), O 1 r 4A, O 1 r 4B Supreme Court Act 1935 (WA), s 37(1), s 60(1)(f) Result: Leave to appeal refused Appeal dismissed Category: B Representation: Counsel: Appellant : K S Byrne First Respondent : S H Parmenter KC & J Sippe Second Respondent : S H Parmenter KC & J Sippe Third Respondent : S H Parmenter KC & J Sippe Solicitors: Appellant : Daniel Jacobson First Respondent : Allens Second Respondent : Allens Third Respondent : Allens -- 2 of 19 -- [2026] WASCA 118 Page 3 Cases referred to in decision: Hooper v Cockles Pty Ltd [No 2] [2025] WASCA 157 House v The King [1936] HCA 40; (1936) 55 CLR 499 Johnson v Denwest Nominees Pty Ltd t/as Cunderdin Roadhouse [2017] WASCA 200 Mineralogy Pty Ltd v Sino Iron Pty Ltd [No 19] [2025] WASC 234 -- 3 of 19 -- [2026] WASCA 118 REASONS OF THE COURT Page 4 REASONS OF THE COURT: Introduction and overview 1 In 2013, the appellant (Mineralogy) brought an action against the respondents (the CITIC parties) with respect to royalties owed to Mineralogy by the CITIC parties under two Mining Right and Site Lease Agreements (MRSLAs). That action, together with a consolidated action, related to what is referred to in the MRSLAs as Royalty Component B (RCB Proceeding). 2 On 18 December 2017, Kenneth Martin J entered judgment for Mineralogy in the RCB Proceeding. His Honour did not, at that time, make orders for costs, the appropriate orders in relation to which were referred to mediation. At the time of making those orders, his Honour made clear that the parties could 'return to the court if that mediation about costs and quantum is not successful'. 3 The parties did not engage in that mediation until May 2023. The mediation was unsuccessful. 4 On 23 August 2023, Mineralogy filed a chamber summons seeking an order for indemnity costs in the RCB Proceeding. By that time, approximately 5 years and 8 months had elapsed since Kenneth Martin J had entered judgment for Mineralogy. His Honour had since retired from judicial office. 5 Mineralogy's application for indemnity costs fell to be determined by Lundberg J. Unsurprisingly, the issue of delay loomed large in the exercise of his Honour's discretion as to whether to order indemnity costs. The learned primary judge refused to make orders for indemnity costs and ordered that the CITIC parties pay Mineralogy's costs on a party/party basis.1 His Honour also declined to make any special costs orders save that his Honour made an allowance for the costs of senior counsel, including for attendances at all pre-trial hearings and the trial. His Honour made no orders removing or increasing the maximum allowable rates or times provided for in the relevant costs determinations. 6 In making these orders, the learned primary judge gave significant weight to what his Honour described as the inordinate delay in seeking costs orders in the RCB Proceeding. 1 Mineralogy Pty Ltd v Sino Iron Pty Ltd [No 19] [2025] WASC 234 (Primary reasons). -- 4 of 19 -- [2026] WASCA 118 REASONS OF THE COURT Page 5 7 Mineralogy sought leave to appeal Lundberg J's decision. In doing so, as counsel accepted, Mineralogy faced a number of significant hurdles. The requirement for the grant of leave provides a mechanism by which the Court can actively discourage the dissipation of further costs in what will very often prove to be a futile attempt to challenge a discretionary judgment relating to costs.2 The discretionary nature of the learned primary judge's decision as to costs, itself, provided an additional hurdle to success on Mineralogy's part. An appeal court will not, without strong reason, interfere with an exercise of discretion on a question of costs.3 8 While Mineralogy sought leave to appeal on three grounds of appeal (each of which had multiple sub-grounds), at the hearing of the appeal counsel for Mineralogy accepted that the success of the appeal depended upon Mineralogy establishing that the manner in which the learned primary judge dealt with the issue of delay was such as to reveal a House v The King4 error.5 That issue was raised by ground of appeal 1. Counsel for Mineralogy accepted that the appeal turned on ground 1 such that the appeal must fail if Mineralogy did not establish ground 1.6 9 At the conclusion of the hearing of the appeal, we concluded that leave to appeal should be refused and the appeal dismissed. In our view there was no substantial doubt as to the correctness of the manner in which the learned primary judge dealt with the issue of delay. It was well open to his Honour to give the delay in making an application for costs the significant weight that his Honour did. It followed that ground 1 failed and that, even if grounds 2 or 3 identified error, such error was not material as the discretionary assessment relied on by the primary judge in the alternative to the impugned findings the subject of those grounds could not be disturbed given the failure of ground 1. 10 We said that we would publish our reasons later. These are our reasons. 2 Johnson v Denwest Nominees Pty Ltd t/as Cunderdin Roadhouse [2017] WASCA 200 [119]; Hooper v Cockles Pty Ltd [No 2] [2025] WASCA 157 [25]. 3 Hooper v Cockles Pty Ltd [No 2] [2025] WASCA 157 [27]. 4 House v The King [1936] HCA 40; (1936) 55 CLR 499, 504 - 505. 5 Appeal ts 6. In written submissions Mineralogy also accepted, quite properly, that ground 1 was 'central' to the other grounds of appeal: appellant's written submissions, par 4. 6 Appeal ts 6 - 7. -- 5 of 19 -- [2026] WASCA 118 REASONS OF THE COURT Page 6 Primary reasons 11 Mineralogy's application for indemnity costs was based primarily on what it contended was the unreasonable conduct of the CITIC parties in defending the RCB Proceeding. In so contending, Mineralogy relied heavily on the reasons for decision of Kenneth Martin J in rejecting the CITIC parties' defences in the proceeding. 12 In that context, Lundberg J observed:7 The typical focus of the Court's analysis when an indemnity costs order is sought by reference to the conduct of the unsuccessful party, is the degree of merit in that party's case. This involves a search by the Court as to whether the case might be characterised as hopeless or unreasonable. That analysis is to be undertaken objectively. An indemnity costs order will reflect the Court's disapproval of the conduct of the unsuccessful party. In all the circumstances, I recognise that there are indications in the material which might objectively support an indemnity costs award had such an application been brought promptly. His Honour's statements within the trial reasons certainly demonstrate his assessment that the CITIC Parties' arguments were untenable and misconceived, in various respects, but such statements do not equate to a conclusion that indemnity costs are warranted. It is therefore not a matter of axiomatically assuming that the primary judge's statements are sufficient to reach a conclusion that the action has been defended in circumstances such that the defendants, properly advised, should have known that they had no chance of success. In making an order for indemnity costs, the Court would be marking the conduct of the CITIC Parties with its disapproval. That is a step which the Court should take in exceptional circumstances, and with considerable caution. That caution is amplified where the judicial officer was not the presiding judge at trial. The various statements made by the primary judge, which denigrate the defence of the CITIC Parties and which are emphasised by Mineralogy in support of the indemnity costs application, will need to be seen in context of course. This is a point highlighted by the CITIC Parties in their submissions. For example, the CITIC Parties note that several of the epithets within the reasons of the primary judge were focused on the severance argument which was only one of the CITIC Parties' defences. … I am also conscious of the observations subsequently made by Quinlan CJ in Sino Iron Pty Ltd v Mineralogy Pty Ltd [No 2] to the effect that 7 Primary reasons [200] - [205]. -- 6 of 19 -- [2026] WASCA 118 REASONS OF THE COURT Page 7 there was, in his Honour's view, nothing in the reasons of the primary judge or the Court of Appeal 'to suggest that the cessation of the benchmark system did not give rise to a genuine justiciable controversy between the parties'. Further, his Honour concluded that 'the difference between the construction reached by Martin J and that preferred by the Court of Appeal (albeit relatively minor) illustrates that the proceedings raised issues of legitimate dispute'. Mineralogy's application for indemnity costs requires, ultimately, that the Court exercise the discretion in s 37 of the Supreme Court Act 1935 (WA) and O 66 r 1(1) RSC, by reference to the principles I have earlier outlined …. The present application for indemnity costs requires that close regard also be paid to a number of other factors in the exercise of the Court's discretion, not only to the objective merits of the application. Those other factors are addressed below 13 The learned primary judge then addressed the issue of delay, which, given its significance for both his Honour's ultimate conclusion and Mineralogy's contentions on appeal, is appropriate to set out in full. 14 His Honour first addressed the length of the delay in making the application for costs:8 First, there is the length of delay involved in bringing the application for indemnity costs. Questions of delay are fact sensitive, of course. There is no absolute rule that a delay of, for example, 12 months or two years is inordinate or excessive. The delay must be judged relative to the nature of the action, its complexity, and all relevant circumstances. In the present case, there are several discrete periods to examine, being the period between the making of final orders and the dismissal of the appeal by the Court of Appeal on 21 May 2019 (around 17 months), the period thereafter until the High Court dismissed the application for special leave on 14 February 2020 (around 8 ½ months), the period thereafter until Mineralogy approached the primary judge in January 2022 (around 1 year and 11 months), the period thereafter until the mediation was held on 2 and 3 May 2023 (around 1 year and 4 months), and finally the 4 month period until the indemnity costs application was filed by Mineralogy on 23 August 2023. There is also the further delay until the CITIC Parties filed their minute of proposed orders, which was on 10 November 2023. … I will address the explanations for these periods of delay below, but the first important observation to make is that the overall period until the primary judge was approached in January 2022 was approximately 4 years. That alone is a grossly excessive delay. The period thereafter, until the formal application was filed, which is another 1 year and 8 Primary reasons [206] - [209]. -- 7 of 19 -- [2026] WASCA 118 REASONS OF THE COURT Page 8 8 months, means the overall period of delay was around 5 years and 8 months. It cannot be denied that this period represents a grossly excessive delay. A further observation is warranted at this point. To the extent to which the costs mediation orders of the primary judge were regarded by one or both sets of parties as, in effect, a 'standstill agreement', I reject that characterisation. Order 11 of the orders made on 18 December 2017 granted the parties liberty to apply on costs issues, including special costs orders and indemnity costs, following the mediation. That order did not pause time in any sense. Time continued to run. 15 The learned primary judge then considered the 'explanation or cause of the delay':9 Second, where a delay is involved, it is relevant to understand the explanation or the cause for the delay. The absence of a cogent explanation will be relevant to the analysis. The absence of any explanation will be highly material. I turn then to the explanation for the delay. The first point to note in this regard is that there is no direct, sworn explanation from Mineralogy or its solicitor for the delay. The affidavits attach numerous items of correspondence passing between the parties, and the course of the proceedings is explained, but no deponent has come forward to provide a direct, sworn explanation. The first periods of delay occurred while the appeal to the Court of Appeal and the application for special leave were pending. Those processes came to an end on 21 May 2019 and 14 February 2020, respectively. Accordingly, the pendency of the appeal processes account for a little more than 2 years of the overall delay. However, as a general observation, I consider that the pendency of appeals does not provide a proper ground for a party's delay in seeking indemnity or special costs orders following a trial. In the present circumstances, I do not consider these appellate processes represent satisfactory reasons for delaying the pursuit of costs orders. It was open to the parties to arrange a mediation during that period and, failing resolution at a mediation, to file formal applications for costs orders with the primary judge. The submission that the unsuccessful party's appellate processes 'impeded resolution of questions of costs' is one that I must reject. A further two years then elapsed until Mineralogy approached the primary judge, in January 2022. I have recounted the communications which were exchanged between the parties over the period from April 2020 through until October 2020, noting that there was then a 12-month gap in the communications at that point until October 2021. 9 Primary reasons [210] - [229]. -- 8 of 19 -- [2026] WASCA 118 REASONS OF THE COURT Page 9 It is evident that, between April 2020 and October 2020, Mineralogy's solicitors wrote on a relatively regular basis to the solicitors for the CITIC Parties to promote the resolution of the costs issues by making costs offers and proposing that the mediation be scheduled. It is not possible to assess whether the offers were reasonable or not, but it is at least apparent they were rejected and the attempts by Mineralogy to pursue a mediation were forestalled by the CITIC Parties. That appears to have been on the basis that sufficient information had not been forthcoming from Mineralogy to support its claims for costs. The best assessment I can make on the available materials is that the requests for information were not unreasonable. The progress of the communications between the parties reached something of an impasse in around October 2020, with the CITIC Parties proposing a mediation in around March 2021, which Mineralogy regarded as an unacceptable delay. At all events, the parties were unable to agree a way forward and the matter seems to have fallen off everyone's radar until around October 2021. No doubt the parties and their advisers were then preoccupied with the other myriad disputes between them. But that is not a proper explanation for the matter drifting. The parties are well-resourced and had ample legal teams available to them. Once the cudgels were taken up again in October 2021, the spectre of the fresh proceedings brought by Mineralogy emerged as a point of discussion between the parties (being CIV 1424 of 2021). For their part, the CITIC Parties viewed this new proceeding as an obstacle to the mediation of costs in CIV 1808 of 2013. Action CIV 1424 of 2021 was filed by Mineralogy on 21 May 2021. The defendants to the action were the CITIC Parties. A brief explanation of the proceedings is warranted. Within the writ of summons, to which a statement of claim was indorsed, Mineralogy alleged that it had incurred costs of administering the MRSLAs in the sum of around $27 m. Those costs are alleged to have included around $19.8 m in legal costs incurred in over 30 legal proceedings, including action CIV 1808 of 2013 and action CIV 3024 of 2017. Those two proceedings form the RCB Proceeding which are the subject of these reasons. By reason of an asserted contractual entitlement on the part of Mineralogy arising under the MRSLAs and the Fortescue Coordination Deed, the terms of which I need not elaborate, Mineralogy demanded payment of the costs which it had incurred. A written notice and a written demand are pleaded to have been made on 12 February 2021 and 8 April 2021. -- 9 of 19 -- [2026] WASCA 118 REASONS OF THE COURT Page 10 It is understandable that the commencement of these fresh proceedings, which seek payment of legal costs incurred in the RCB Proceeding, among other legal proceedings, caused some concern on the part of the CITIC Parties. On the face of matters, it may have appeared as though Mineralogy was seeking double-recovery of the costs, or at least that there were now parallel processes in train addressing the same issue. At all events, by November 2021, the parties had reached another impasse it seems. As I have stated above, the delay to this point was grossly excessive. By November 2021, almost 4 years had passed since final orders were made by the primary judge. In my respectful view, no explanation of substance has been forthcoming for this delay. The affidavit material recites the history of the proceedings and the correspondence, but none of that in truth explains why Mineralogy could not have initiated the mediation process earlier or sought costs orders from the Court. It may be said that the CITIC Parties played a degree of interference in their correspondence, responding to the attempts by Mineralogy to pursue a resolution to the costs. But even a conclusion that the CITIC Parties were being obstructive does not explain the delay in any real sense. There were significant periods where there was no movement on the issue at all. It remained open to Mineralogy to approach the Court to list the mediation or seek orders from the primary judge if necessary. That was not done until January 2022. Prior to that, and simply to emphasise the point just made, it was always open for Mineralogy to 'outflank' the manoeuvring of the CITIC Parties by directly approaching the Court to list the mediation or by approaching the primary judge. There was no imbalance of power between these parties which might lead the Court to conclude that Mineralogy was being pressured by the CITIC Parties in any way, or being dissuaded from pursuing whatever costs entitlements it had. When the primary judge was first approached by Mineralogy in January 2022, the timing could not have been more inopportune. The primary judge was shortly to commence hearing the 10-week civil trial between the CITIC Parties and Mineralogy known as the 2017 MCP Proceeding (CIV 1915 of 2019). The trial of that action commenced on 21 February 2022 and ran for some 33 hearing days until 29 April 2022. I have earlier recounted his Honour's response to the parties, through his associate, which was sent on 21 January 2022. His Honour made it clear he would be unable to hear the application for some time. However, it is important to understand the nature of the approach which was made by Mineralogy. The email from Mineralogy's solicitor to the Court, sent on 18 January 2022, was focused on the dispute between the parties concerning the impact of the fresh proceedings, CIV 1424 of 2021. Mineralogy foreshadowed it would file a chamber summons seeking orders to dispose of the question of costs in the RCB Proceeding, given the dispute between the parties. -- 10 of 19 -- [2026] WASCA 118 REASONS OF THE COURT Page 11 The trail of correspondence goes cold at this point. All concerned were no doubt then in the teeth of battle on the 2017 MCP Proceeding. The next communication appears to be in around July 2022, some months later. There were further exchanges of communications between the parties through until February 2023 when the mediation was listed. Then, in March 2023, Mineralogy's solicitors wrote to the primary judge's associate to confirm that the earlier mentioned chamber summons had not been filed by Mineralogy and the 'issue the subject of the chamber summons [was] proceeding to mediation between the parties before Registrar Davies'. It cannot be said that any material part of the delay is attributable to the Court. As I have noted, there was one occasion in which the primary judge indicated he could not hear any application until after the conclusion of the trial of the 2017 MCP Proceeding, and after his Honour had delivered reasons in that action. That was in January 2022, already some 4 years after the final orders had been at trial. Importantly, the parties did not make arrangements for the mediation until well into 2023. The primary judge's assessment that there was 'sustained inertia' on the part of the litigants is one with which I respectfully agree (at [65] above). It was always open to Mineralogy and, indeed, to the CITIC Parties if they wished to seek orders, to list the mediation and thereafter file applications to the primary judge to dispose of any costs questions. It can be inferred that decisions were taken by the parties to focus on other matters. There were undoubtedly several other disputes on foot between the parties during this time. That does not operate as a satisfactory explanation for the delays, in my view. 16 His Honour next addressed the issue of prejudice flowing from the delay:10 Third, the likely prejudice flowing from the delay and the extent of that prejudice are relevant considerations to examine. The greater the lapse of time and the weaker the explanation, the less significant the prejudice may need to be in order to justify a decision to decline to exercise the discretion in a particular manner. That prejudice will also fall to be assessed having regard to the nature of the costs orders sought and the complexity of the action. The prejudice which may flow from delays in pursuing final costs orders has several facets. The delay may impair the ability of the Court to properly assess the costs orders which are sought. 10 Primary reasons [230] - [237]. -- 11 of 19 -- [2026] WASCA 118 REASONS OF THE COURT Page 12 The delay may impair the ability of the opposing party to properly respond to the costs orders which are sought. The delay must also be seen in the context of the Court's costs assessment process, not simply by reference to the hearing at which the final costs orders are sought. For example, it should be recognised that orders which will permit the costs assessment (or taxation) process to be undertaken by reference to whether the costs have been unreasonably incurred or are of an unreasonable amount, or by removal of scale items, will likely lead to a far more complex and time consuming costs assessment process before a Registrar, in my experience, compared to a costs assessment based on scale amounts. Where a costs assessment process predicated on indemnity costs or special costs orders is required to be undertaken many, many years after the work was undertaken, the process is likely to be extremely challenging, time consuming and inefficient. The prejudice in the present case is significant, on my assessment. First, the delay in pursuing these matters when there was ample opportunity to do so, has meant the proceeding has extended beyond the retirement of the primary judge. The assessment of the costs issues must therefore be undertaken by another judicial officer. However, even the primary judge's assessment of the costs issues, and the work undertaken by the parties during the proceedings, is likely to have been unreliable given the lapse of time involved. Second, the delay operates to prejudice the ability of the opposing party to respond to the application. Third, the costs orders sought are very likely to create the type of challenging, time consuming and inefficient costs assessment process I have mentioned above, given the size of the costs claim, the complexity of the proceedings and the likely number of line items in the bills of costs which would need to be reviewed. Overall, I consider the considerable delay since the primary judge made final orders, which is around 5 years and 8 months, has left the Court in the problematic position of having to assess the course of the action and the conduct of the parties without the usual benefit of having seen and heard the evidence and the arguments. That is a prejudice which I consider is material. It implicitly brings with it a prejudice to the CITIC Parties in being able to properly respond to the application. Further, the nature of the order sought by Mineralogy, for indemnity costs, is very likely to create a far more complex, time consuming and costly assessment process before a Registrar of this Court, which will also consume the valuable and scarce resources of the Court. -- 12 of 19 -- [2026] WASCA 118 REASONS OF THE COURT Page 13 17 Having identified a number of other considerations relevant to the exercise of the discretion as to costs, the learned primary judge reached the following overall conclusions:11 In the present case, I must say I can see force in the application made by Mineralogy for indemnity costs, having regard to the apparent weakness of the CITIC Parties' defences in the underlying proceeding. The force of that position emerges from the recorded observations of the trial judge to which I have referred, including statements that the 'contended frustration' of the instruments was 'always an untenable proposition', and assessments by his Honour that various arguments advanced by the CITIC Parties were 'commercially unreal', 'repugnant to commercial common sense', 'self-serving', and 'misconceived' … His Honour may well have been disposed to grant indemnity costs orders had such an application been made to him in a timely manner, prior to his retirement. But that was not done. The difficulty which now arises is that a judicial officer who did not hear the evidence and the arguments is called upon to assess whether the arguments presented by the CITIC Parties were so hopeless and untenable that the exceptional order of indemnity costs should be granted, across the whole of the action. I have a great deal of difficulty with making such an order. As noted, I did not sit through the trial and do not have the same understanding of the material and the arguments which the primary judge would have. I have noted above the grossly excessive delay between the making of the final orders in December 2017 and the first occasion on which the Court was approached, which was January 2022. That delay was around 4 years. But there was a further delay of some 20 months until the costs application was filed in August 2023, following the unsuccessful mediation in May 2023. That further delay is also excessive, in my view. As I noted at the outset of these reasons, costs issues on such matters should properly be resolved in close proximity to the trial, while the matter is fresh in the mind of the trial judge and the Court is better able to undertake a reliable assessment of the work involved, having regard to the findings made at trial. It is far from an attractive or efficient proposition to have a judicial officer other than the trial judge, on a matter of this magnitude and complexity, hear and determine the parties' competing arguments as to costs, especially after such an inordinate delay. There was ample time for the parties to seek costs orders prior to the filing of the present applications. 11 Primary reasons [243] - [253]. -- 13 of 19 -- [2026] WASCA 118 REASONS OF THE COURT Page 14 In all the circumstances, although I recognise that there are indications in the material which might objectively support an indemnity costs award had such an application been brought promptly, I consider the inordinate delay in this case, which is largely unexplained in any meaningful way, and which has led to material prejudice of the kinds I have identified, points strongly against the making of any order of the type sought by the plaintiff. The delay in this case has caused prejudice as earlier explained. It must also be remembered that making such an order in effect operates as a sanction, marking the conduct of the unsuccessful party with the Court's disapproval as being improper or unreasonable. The imperative for such a sanction to be imposed after such a lengthy delay by Mineralogy in pursuing these orders must surely be doubtful. I therefore decline to make such an order in the exercise of the Court's discretion. In general terms, it should be said that delays in pursuing costs orders after trial, such as the one apparent in the present case, are antithetical to the goal and objects in O 1 r 4A and r 4B RSC and should be deprecated. Ground 1 – the hinge of the application for leave to appeal 18 As observed above, counsel for Mineralogy accepted that it could not sustain the appeal unless Mineralogy established there was merit in, and that leave to appeal should be granted in relation to, ground 1, which concerned its challenge to the exercise of the learned primary judge's discretion as to costs. 19 Ground 1 provides: Ground 1 – Mineralogy should have been awarded indemnity costs on the basis that the conduct of the CITIC Parties in defending the claims was unreasonable 1. The primary judge erred (and acted on a manifestly erroneous view of the facts or law): (a) in fact and law in finding (at [213]) that the appellate processes do not provide a satisfactory reason for delaying the pursuit of costs orders and that the appellant failed to pursue the disposition of costs during that process; (b) in making a mistake of mixed fact and law in finding that no explanation of substance was forthcoming for the delay (at [223], [229]); -- 14 of 19 -- [2026] WASCA 118 REASONS OF THE COURT Page 15 (c) in making a mistake of mixed fact and law in finding that prejudice to the respondents was a material consideration to be weighed in considering whether to award indemnity costs based on the conduct of those parties ([233], [236], [237]), in circumstances where the delay was centrally attributable to the respondents such that prejudice arising from that delay was not a material consideration; (d) in making a mistake of mixed fact and law in finding that delay in bringing the application materially affected the ability of the Court to assess whether the conduct of the respondents justified the making of an order for indemnity costs against them; (e) in making a mistake of law in not adequately taking into account the force of the application for indemnity costs based on the weakness of the respondents’ defences in the underlying proceeding ([243]-[245]); and (f) in making a mistake of mixed fact and law in finding that inordinate delay in bringing the application weighed strongly in favour of declining it (at [248]-[252]). 2. The learned primary judge should have found: (a) that the appellant properly sought to engage with the respondents regarding an agreed procedure, sanctioned by the Court, for the disposition of costs issues; (b) that the consequent delay in bringing its application for indemnity costs: (i) was adequately explained based on an objective evaluation of the correspondence adduced in evidence by the parties on the application; (ii) was occasioned principally by the conduct of the respondents; and/or (iii) did not prevent the considered assessment of the application based on the respondents’ conduct of the proceeding; and (c) that an order for indemnity costs against the respondents based on their conduct of the proceedings below was appropriate. -- 15 of 19 -- [2026] WASCA 118 REASONS OF THE COURT Page 16 3 On the basis of the matters identified in paragraphs [1] and [2] above, the exercise of the discretion by the learned primary judge on the application for indemnity costs on the basis of conduct of the respondent was otherwise unreasonable and plainly unjust such that it meets the standard of discretionary error established in House v The King (1936) 55 CLR 499. 20 It will be apparent from the sub-paragraphs to ground 1 that the 'errors' alleged by ground 1 – which all relate to the learned primary judge's consideration of delay – in large part consist of complaints as to the weight that the learned primary judge gave to particular matters (e.g. 'not adequately taking into account the force of the application for indemnity costs', 'in finding that inordinate delay in bringing the application weighed strongly in favour of declining it'). So identified, the alleged 'errors' suggest weighting errors, rather than an error of principle. That is not a proper basis for challenging a discretionary decision. So long as the learned primary judge properly identified and considered the relevant material considerations, the evaluation of those considerations, and the weight to be afforded to them, was a matter for his Honour (subject to the result not being 'unreasonable or plainly unjust'). 21 Recognising this, counsel for Mineralogy submitted, in essence, that the exercise of discretion by the learned primary judge involved incorrect weighting to factors in a manner that rendered his Honour 'not having properly exercised the discretion or not exercised the discretion at all'.12 Because of this, according to counsel for Mineralogy, the outcome was unreasonable or plainly unjust in the sense described in House v The King. Accordingly, while the appeal was 'cast'13 in terms of implied error, that was because the discretion had not been properly exercised – the delay being given weight that should not have been accorded to it and the process of assessing the claim for indemnity costs based on Kenneth Martin J's findings having not been given sufficient weight.14 22 Counsel contended that the primary judge made three broad errors with respect to the issue of delay. 23 The first error, counsel submitted, was that the learned primary judge erred in concluding that the delay affected the ability of the court to assess whether the conduct of the respondents justified the making of 12 Appeal ts 5. 13 Appeal ts 5. 14 Appeal ts 6. -- 16 of 19 -- [2026] WASCA 118 REASONS OF THE COURT Page 17 an order for indemnity costs.15 Counsel submitted that the trial judge's advantage in making that assessment '[did not] apply to indemnity costs orders based on reasons for judgment', which he submitted was an 'objective assessment', which 'can occur many years after a hearing is conducted and there's no difficulty with that'. For that reason, counsel submitted that the delay ought to have had 'either no weight or no determinative weight'.16 24 The second error, counsel submitted, was that the learned primary judge inferred prejudice to the court and the CITIC parties without any evidence.17 He submitted that there was 'no basis to find prejudice to a taxation or prejudice to the court process in a practical sense because there's no evidence upon which it could be based'.18 25 The third alleged 'error' submitted by counsel for Mineralogy was that the learned primary judge erred in concluding that there was no satisfactory explanation for the delay.19 Counsel submitted that the delay was not attributable or solely attributable to Mineralogy and relied, in particular, on its efforts to confer with the CITIC parties.20 Disposition 26 There was no merit in Mineralogy's contention that the learned primary judge erred in his treatment of Mineralogy's delay in bringing its application for costs, or in the exercise of his discretion as to whether to award indemnity costs or special costs orders. It will be apparent that we have reproduced much of the primary judge's reasoning for his conclusions on these issues. We have done so because, far from revealing discretionary error, the primary judge's reasons disclose the close and careful attention that his Honour gave to the material considerations, and the weight to be accorded to them, in the exercise of the discretion. This is far from a case where the primary judge did not properly exercise the discretion or did not exercise the discretion at all. 27 Mineralogy's delay was, as the learned primary judge said, 'extraordinary and excessive'.21 It was plainly relevant to the exercise of the court's discretion as to costs generally, including as to any special 15 Ground 1.1(d) & (e). 16 Appeal ts 8 - 9. 17 Ground 1.1(c). 18 Appeal ts 13. 19 Ground 1.1(a) & (b). 20 Appeal ts 13 - 14. 21 Primary reasons [6]. -- 17 of 19 -- [2026] WASCA 118 REASONS OF THE COURT Page 18 costs orders that might be made. And, contrary to Mineralogy's submissions, it was plainly relevant to the extent to which his Honour could determine whether the conduct of the CITIC parties was such as to justify an order for indemnity costs. Mineralogy's contention that the delay created no impediment to an 'objective assessment' of that issue must be rejected. 28 In that regard, Mineralogy sought to focus entirely on the reasons for decision delivered by Kenneth Martin J following the trial of the RCB Proceeding. In essence, Mineralogy submitted that in order to conclude that an order for indemnity costs was justified, all Lundberg J had to do was read the critical observations of the CITIC parties' case in Kenneth Martin J's reasons and that the delay created 'no difficulty with that'. 29 Mineralogy's exclusive focus on Kenneth Martin J's reasons for decision was misconceived, for two reasons. 30 First, as Lundberg J recognised, a bare reading of the trial judge's ultimate conclusions does not necessarily reveal that the conduct of a party is such as to justify the exceptional course of awarding indemnity costs, particularly given that the order would apply 'across the whole of the action'. The assessment as to whether the conduct of a party is such as to justify an order for indemnity costs must be assessed by reference to the conduct of the party as a whole. The learned primary judge was correct to conclude that such an assessment is far better able to be made by the trial judge in close proximity to the trial. 31 Secondly, as the learned primary judge also recognised, the conclusion that the unsuccessful party to litigation has been involved in some unreasonable conduct in relation to the proceedings does not automatically lead to the making of an order for indemnity costs. Unreasonable conduct by a party may enliven the discretion to award indemnity costs; it does not exhaust the considerations relevant to the exercise of that discretion by another judge many years later. 32 Similarly, in relation to the prejudice caused by the delay, the learned primary judge's treatment of that issue is unimpeachable. His Honour did not need evidence to conclude that a costs assessment (or taxation) process as to whether costs have been unreasonably incurred or are of an unreasonable amount, conducted many years after the work was undertaken, would likely be 'extremely challenging, time -- 18 of 19 -- [2026] WASCA 118 REASONS OF THE COURT Page 19 consuming and inefficient'. That conclusion is well within the court's own knowledge and indeed, with respect, is obvious. 33 Thirdly, in relation to the putative 'explanation' for the delay, the learned primary judge expressly recognised that 'the CITIC parties may be said to have played a degree of interference in their correspondence'. It was not to the point, as Mineralogy maintained on the appeal, that it had attempted, at various times, to progress the issue of costs in correspondence with the CITIC parties. The delay with which the learned primary judge was concerned was the delay in making an application to the court. As his Honour properly found, there was never any impediment to Mineralogy making an application to the court and there was no satisfactory explanation for its failure to do so. 34 Ultimately, the Primary reasons reveal that the learned primary judge carefully identified and considered all of the considerations relevant to the exercise of his discretion in relation to costs. It was well open to his Honour to place the significant weight on the inordinate delay that he did. There was no basis for this Court to conclude that his Honour's discretion had in any way miscarried. 35 For these reasons we refused leave to appeal and dismissed the appeal. Costs of the appeal 36 As counsel for the CITIC parties had the good sense not to apply for indemnity costs on appeal, we ordered Mineralogy to pay the CITIC parties' costs of the appeal to be assessed if not agreed. I certify that the preceding paragraphs comprise the reasons for decision of the Supreme Court of Western Australia. JN Associate to the Hon Chief Justice Quinlan 25 AUGUST 2026 -- 19 of 19 --