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12 Dec 2019

Objectors to Queensland mining leases and related environmental authorities about to lose risk of adverse costs orders

By Jasmin Singh, Mark Geritz

As the Justice and Other Legislation Amendment Bill 2019 (if enacted) will limit the proponent's scope to seek costs against an objector even if the objections are wholly unsuccessful and the applications are recommended for grant by the Land Court, there will be limited impediment to object to mining leases and related environmental authorities.

If enacted, the Justice and Other Legislation Amendment Bill 2019 will have key implications for the resources industry by limiting the scope for parties that have had matters referred to the Land Court under legislation such as the Mineral Resources Act 1989 (Qld) (MRA) and the Environmental Protection Act 1994 (Qld) (EPA) to recover legal costs – the potential for costs awards having traditionally acted as a deterrent to objectors.

While the Bill contains a range of amendments to various Acts, it is these limitations that are the focus of this article.

Current costs regime for matters under recommendatory provisions

As the law currently stands, section 34 of the Land Court Act 2000 (Qld) (LCA) provides that the Land Court can order costs for a "proceeding" as it considers appropriate. If the Land Court does not make an order for costs, then each party must bear their own costs for the proceeding.

Sections 52A and 52B of the LCA extend the power of the Land Court to order costs where the Land Court is performing a function conferred on the court under a "recommendatory provision". This includes matters referred to the Land Court such as objections to mining leases under the MRA and environmental authorities under the EPA.

Section 52A and 52B were introduced into the LCA after the Supreme Court decided that such matters were not a "proceeding" for the purposes of the Land Court rules (BHP Mitsui Coal Pty Ltd v Isdale [2015] QSC 107).

Currently, the Land Court has a broad discretion as to the award of costs in such matters. Recently, it has confirmed that a party does not have to show exceptional circumstances and the principle that costs follow the event is well embedded in the law.  

Proposed changes to the costs regime for matters under recommendatory provisions

The Bill would insert a new section 52C into the LCA, to apply where the Land Court is performing a function conferred on it under a "recommendatory provision".

It would mean that each party bearing its own costs would be the default position with the Land Court only being permitted to make an order for costs in certain limited circumstances (such as where the Court considers that all or part of an objection is frivolous or vexatious).

How does the Bill impact the mining industry?

This is a key amendment for the mining industry, given that objections to mining lease and environmental authority applications are routinely referred to the Land Court under the MRA and EPA. The proponent must participate in the proceedings in order to advance the relevant application being sought.

As the Bill has the effect of limiting the proponent's scope to seek costs against an objector even if the objections are unsuccessful and the applications are recommended for grant, there will be limited impediment to object to mining leases and related environmental authorities.

Application to existing matters

If the Land Court has started performing functions or powers conferred by "recommendatory provisions" before the amendments commence, the current provisions of the LCA will continue to apply. Therefore, all matters that have been, or will be, referred to the Land Court under the "recommendatory provisions" of the LCA prior to the Bill becoming law in Queensland will still have the benefit of the Land Court's broad discretion to award costs in those hearings.

However, persons who may in the future seek to apply for, or object to, an application for a mining lease or environmental authority, should be aware that if those applications are referred to the Land Court after the Bill becomes law, their ability to recover legal costs from the other party will be restricted.

Progress of Bill

The Bill has been referred to the Legal Affairs and Community Safety Committee for detailed consideration. The committee is required to report by Friday 21 February 2020. The closing date for written submissions about the Bill to be made to the Committee is midday, Monday 6 January 2020.

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Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this communication. Persons listed may not be admitted in all States and Territories.