The Supreme Court of Queensland has recently dismissed a challenge by Waratah Coal Pty Ltd of a decision of the Queensland Government to reject Waratah Coal’s proposed rail line.

The decision highlights the need for proponents to be aware of the prevailing government policy when seeking the exercise of a discretion in their favour. The case demonstrates the court’s propensity not to challenge decisions by members of the executive government solely on the ground that the decision took into account the policy considerations of the government of the day. 

Waratah Coal Pty Ltd v Seeney & Anor [2014] QSC 226

The case of Waratah Coal Pty Ltd v Seeney & Anor [2014] QSC 226, concerned an application by Waratah Coal Pty Ltd (Waratah) challenging the Queensland Government’s decision not to approve Waratah Coal’s rail corridor as an “infrastructure facility of significance” under the State Development and Public Works Organisation Act 1971 (the Act).  If Waratah Coal had been given the approval initially, this would have allowed them to utilise the powers of the Coordinator General to compulsorily acquire land, thus removing a significant hurdle to the rail line being built.

Key issues

Issue 1: Did the decision-maker allow policy to dictate the decision?

Waratah argued that the decision-maker failed to have regard to the merit of its application and instead gave primacy to the government policy. This argument, however, was rejected by Justice Daubney who found that there is no error in treating policy frameworks as having decisive weight, especially where the decision involves a value judgment and the decision-maker represents the executive government.

It was found that the decision-maker was entitled to take into account the fact that Waratah’s application did not fall within the proposed rail corridors referred to by the Minister in determining whether the merits of the application were sufficient to outweigh government policy.

Issue 2: Relevant and irrelevant considerations

Waratah’s argument that the decision-maker took into account irrelevant considerations was also rejected. The considerations which were complained about related to the timing of Waratah’s proposed facility which, in the opinion of the decision-maker, could not ‘be accurately predicted’. The court found, however, that the timeliness of progression of the proposed facility was a relevant consideration which the decision-maker was entitled to take into account.

It was also argued that the decision-maker failed to take into account considerations relating to the comparable attributes of the proposed facilities by other proponents. Justice Daubney rejected this argument, noting it was Waratah’s proposed facility being assessed; considerations of other proposed facilities were irrelevant.

Issue 3: Unreasonableness of the decision

Waratah’s final argument was that the decision made was so unreasonable that no reasonable person could reach it. The Court though was not convinced that this was correct. The decision-maker identified the relevant government policy in existence at the time and considered it along with the merits of the application. Accordingly, the decision to refuse the application was reasonable.

Background

On 1 July 2011, Waratah, a proponent of a coal mining project in the Galilee Basin, made an application to the relevant Minister for approval of a rail corridor to the Port of Abbot Point, as an “infrastructure facility of significance” under s 125(1)(f) of the Act. Had this approval been obtained, Waratah would have been able to utilise the Coordinator General’s powers under the Act to compulsorily acquire land. This would have removed a significant hurdle to the rail line being built.

On 6 June 2012, the Minister announced the Government’s policy, stating that the government would support two rail corridors, located on a “west to east” alignment and a “south to north” alignment respectively. The Minister also wrote to the chairman of the parent company of Waratah, advising him of this policy. Relevantly, Waratah’s application did not fall within the location of the rail corridors referred to by the Minister.

Despite being aware that the rail corridor did not align with the policy of the State Government, Waratah continued to progress its application for approval of its rail corridor as an ‘infrastructure facility of significance’.

On 31 October 2013, the Governor-in-Council refused Waratah’s application.

Waratah subsequently sought review of the Minister’s decision on various grounds, including that:

  • the decision-maker allowed the Government’s statement of policy to fetter the exercise of his discretion;
  • the decision-maker took into account irrelevant considerations and failed to take relevant considerations into account; and
  • the decision was so unreasonable that no reasonable person could have reached it.