Federal Court of Australia

Hancock Prospecting Pty Ltd v Rinehart (No 3) [2021] FCAFC 23

ORDERS

THE COURT ORDERS THAT:

1.    Leave be granted to Bianca Rinehart and John Hancock to amend their Interlocutory applications dated 30 September 2020 in accordance with the document annexed to their submissions on costs dated 13 November 2020 (the Interlocutory Applications).

2.    The Interlocutory Applications be dismissed.

3.    The applicants in the Interlocutory Applications pay the respondents’ costs of the said Applications.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

THE COURT:

Introduction

1    There are two Amended Interlocutory applications before the Court (the Applications). They are brought by Bianca Rinehart and John Hancock. We will refer to them as the applicants. The respondents to the Applications are Hancock Prospecting Pty Ltd and associated entities (the HPPL parties) and Georgina Rinehart and associated entities (the Gina parties). The Applications concern costs orders made by this Court in two appeals (including applications for leave to appeal) whereby the applicants were ordered to pay costs in favour of the HPPL parties and the Gina parties.

2    In 2017, this Court heard and determined two appeals (NSD 916 of 2016 and NSD 922 of 2016) from orders made by a judge of the Court at first instance (NSD 1124 of 2014). The Court made orders in the appeals, including orders with respect to the costs of the appeals.

3    The costs orders which are the subject of the Applications relate to the costs of the appeals, not the costs of the proceeding at first instance. The HPPL parties did file a bill of costs with respect to the costs of the proceeding at first instance, but on 24 June 2020, a District Registrar and Taxing Officer of the Court refused to make an estimate in respect of that bill of costs. The District Registrar and Taxing Officer set out her reasons for making that decision in a letter to the parties dated 24 June 2020. That decision has not been challenged.

4    Nor do the present Applications relate to the costs of the appeal and cross-appeal to the High Court of Australia from the orders of this Court. The High Court made orders for costs with respect to the appeal and cross-appeal before it and those costs have been taxed and paid. The costs which are presently in issue are only the costs of the appeals to this Court.

5    On 16 June 2020, the HPPL parties filed a bill of costs in this Court with respect to the costs in each appeal. A Registrar of the Court has made an estimate of the total amount for which, if the bill were to be taxed, the certificate of taxation will be likely to issue. In the case of NSD 916 of 2016, the estimate is in the amount of $616,100, and in the case of NSD 922 of 2016, the estimate is in the amount of $525,200.

6    The orders which the applicants seek in each Application are the same. They are as follows:

1    Pursuant to the Court’s implied power and/or Rule 41.01 of the Federal Court Rules 2011, order that there be no further proceedings on the Bill of Costs filed by the applicants on 16 June 2020 until the final determination of the proceedings below.

2    Further or alternatively, pursuant to the Court’s implied power and/or Rule 39.05(e) of the Federal Court Rules 2011, order that costs of this appeal not be taxed until the final determination of the proceedings below, or in the further alternative, pursuant to Rule 41.03 of the Federal Court Rules 2011, order 8 made on 15 December 2017 be stayed pending the final determination of the proceedings below.

3    Costs of this application.

4    …

7    The applicants identified the particular implied power upon which they relied as the power identified by Allsop J (as his Honour then was) in Owston Nominees No 2 Pty Limited v Branir Pty Ltd [2003] FCA 629; (2003) 129 FCR 558. In that case, his Honour referred to the general common law rule that once a judgment of the Court has been passed and entered, the Court thereafter lacks power to make an order that alters or sets aside that judgment. In the following passage, his Honour referred to at least four relevant possible bases for the exercise of power to deal with entered orders recognised by the common law (at [27]):

Thus, the common law appears to recognise, relevantly, at least four relevant possible bases for the exercise of power to deal with entered orders (i) ambiguity, invoking the need for construction, (ii) where the order does not reflect what the court decided, (iii) where something is to be added not dealt with by the court, which circumstance is probably limited to “ancillary” or “consequential” matters, and (iv) a supplemental order, the need for which arises from circumstances occurring after the order was made. (I leave aside the slip rule, fraud and self executing orders.) In respect, especially, of (i) to (iii) above, it is necessary to look at the surrounding circumstances. These include the reasons, the pleadings and, if necessary, the evidence and how the case was conducted: Australian Energy v Lennard Oil NL (No 2) [1988] 2 Qd R 230; Repatriation Commission v Nation, supra; Yates Property Corporation Pty Ltd v Boland (1998) 89 FCR 78; Hanave Pty Ltd v LFOT Pty Ltd [2000] FCA 388 at [6] and [7]; Ecrosteel Pty Limited v Pefor Printing Pty Ltd, supra; Re Muirhead; Ex parte Commonwealth Bank [1997] FCA 365; and Blacktown Concrete v Ultra Refurbishing (1998) 43 NSWLR 484, 491-2. The Full Court in Caboolture said that O35 r 7 “largely reflects the common law position”.

8    His Honour also referred to the then O 35 r 7 of the Federal Court Rules 1979 (Cth) (the 1979 Rules). The equivalent rules in the Federal Court Rules 2011 (Cth) (the Rules) are rr 39.04 and 39.05. The applicants rely, in particular, on r 39.05(e) which is in the following terms:

The Court may vary or set aside a judgment or order after it has been entered if:

…

(e)    it does not reflect the intention of the Court;

9    The other two rules upon which the applicants rely are rr 41.01 and 41.03. Those rules are in the following terms:

41.01 Application without notice for directions

A party or an interested person may, without notice, apply to the Court for directions about the enforcement or execution of an order.

41.03 Application for stay of judgment or order

A party bound by a judgment or order may apply to the Court for an order that the judgment or order be stayed.

10    There was a suggestion by the applicants that a single judge could hear and determine the Applications by virtue of the power in s 25(2B)(ab) of the Federal Court of Australia Act 1976 (Cth) which provides that a single judge sitting in chambers or in open court (or a Full Court) may “make an interlocutory order pending, or after, the determination of an appeal to the Court”.

11    In their written submissions, the applicants submit that a single judge has the power to determine the Applications under s 25(2B)(ab). They go on to submit, however, that as the Applications raise questions as to the proper construction of the orders and reasons of the Full Court, “it may be considered more appropriate for the applications to be dealt with by the Full Court”. They state that they leave the matter in the hands of the Court. The HPPL parties submit that the Full Court should consider the Applications because the Applications require the construction of the orders and reasons of the Full Court. The Gina parties did not make a submission on this point. In our view, although it may be that part of each Application can be dealt with by a single judge, that part of the Application which involves the contention that the orders of the Full Court did not reflect the intention of the Court must be dealt with by the Full Court. Plainly then, it is convenient that the Full Court deal with the entirety of the Applications.

The Facts

12    On 27 October 2017, this Court delivered its principal judgment in relation to the appeals and cross-appeals and notices of contention (Hancock Prospecting Pty Ltd v Rinehart [2017] FCAFC 170; (2017) 257 FCR 442). The Court set out the orders which the Court then considered should be made (at [417]). The Court said that if any party considered that the Court had overlooked any matter or wished to put anything to the Court on the form of the orders, then he, she or it had leave within 14 days and after consultation with the other parties to the litigation, to file an index of no more than one page in length of topics said to be appropriate for further submissions. The orders which the Court then considered should be made were as follows:

1    Leave to appeal be granted.

2    The appeals be allowed.

3    The cross-appeals be dismissed.

4    The notice of contentions be dismissed.

5    The orders of the Court made on 26 May 2016 be set aside and in lieu thereof order that the proceedings brought in the Court by the applicants being NSD1124/2014 be stayed under s 8(1) of the Commercial Arbitration Act pending any arbitral reference between the parties or until further order, save and except for those claims made against those entities that are not parties to the arbitration agreement, being Hope Downs Iron Ore Pty Ltd, Roy Hill Iron Ore Pty Ltd, Mulga Downs Investments Pty Ltd and Mulga Downs Iron Ore Pty Ltd.

6    The claims made by the applicants in the underlying proceedings against Hope Downs Iron Ore Pty Ltd, Roy Hill Iron Ore Pty Ltd, Mulga Downs Investments Pty Ltd and Mulga Downs Iron Ore Pty Ltd be stayed on the same terms as the stay in order 5.

7    Subject to the stays in order 5 and 6 above, the matter be remitted to the primary judge for any application properly available in the light of the stays.

8    The respondents pay the appellants’ costs of appeal including the costs of the application for leave to appeal, subject to Hope Downs Iron Ore Pty Ltd, Roy Hill Iron Ore Pty Ltd, Mulga Downs Investments Pty Ltd and Mulga Downs Iron Ore Pty Ltd paying the costs related to the question as to whether those entities are parties to the arbitration agreement pursuant to s 2 of the CA Act.

9    Leave be granted nunc pro tunc to Wright Prospecting Pty Ltd to intervene on the condition that they bear their own costs of intervention.

13    In the principal judgment, the Court considered whether Hope Downs Iron Ore Pty Ltd, Roy Hill Iron Ore Pty Ltd, Mulga Downs Investments Pty Ltd and Mulga Downs Iron Ore Pty Ltd, who were not named as parties in any deed or arbitration agreement, should nonetheless be referred to arbitration because they claimed “through or under” entities who are parties to the relevant deed or agreement for the purpose of the definition of the word “party” in s 2(1) of the Commercial Arbitration Act 2010 (NSW) (the CA Act). The Court decided that those companies were not claiming “through or under” entities who are parties to the relevant deed or agreement for the purpose of the definition of the word “party” in s 2 of the CA Act (at [289]–[323]). That is why those companies are the subject of the exceptions in paragraphs 5 and 8 of the Court’s proposed orders.

14    On 10 November 2017, the Gina parties, supported by the HPPL parties, sent to the Court the orders they sought in the form of “amendments” to the orders which the Court had indicated that it was disposed to make. The orders which the successful parties sought with the amendments marked were as follows:

1    Leave to appeal be granted.

2    The appeals be allowed.

3    The cross-appeals be dismissed.

4    The notice of contentions be dismissed.

5    The orders of the Court made on 26 May 2016 be set aside and in lieu thereof order that the proceedings brought in the Court by the applicants being NSD1124/2014 be stayed under s 8(1) of the Commercial Arbitration Act pending any arbitral reference between the parties or until further order, save and except for those claims made against those entities that are not parties to the arbitration agreement, being Hope Downs Iron Ore Pty Ltd, Roy Hill Iron Ore Pty Ltd, Mulga Downs Investments Pty Ltd and Mulga Downs Iron Ore Pty Ltd.

6    The claims made by the applicants in the underlying proceedings against Hope Downs Iron Ore Pty Ltd, Roy Hill Iron Ore Pty Ltd, Mulga Downs Investments Pty Ltd and Mulga Downs Iron Ore Pty Ltd be stayed on the same terms as the stay in order 5.

7    Subject to the stays in order 5 and 6 above, the matter be remitted to the primary judge for any application properly available in the light of the stays.

8    The first and second respondents pay forthwith the appellants’ costs of appeal including the costs of the application for leave to appeal., subject to Hope Downs Iron Ore Pty Ltd, Roy Hill Iron Ore Pty Ltd, Mulga Downs Investments Pty Ltd and Mulga Downs Iron Ore Pty Ltd paying the costs related to the question as to whether those entities are parties to the arbitration agreement pursuant to s 2 of the CA Act.

9    The first and second respondents pay forthwith the appellants’ costs of the appellants’ interlocutory application filed on 24 December 2014 in Federal Court of Australia Proceedings No. NSD 1124/2014.

910    Leave be granted nunc pro tunc to Wright Prospecting Pty Ltd to intervene on the condition that they bear their own costs of intervention.

15    For present purposes, the material alterations to the order which the Court then considered appropriate is the requirement that, in relation to both the costs at first instance (paragraph 9) and the costs of the appeals (paragraph 8), such costs be paid forthwith.

16    The parties made written submissions on the differences between them with respect to the proposed orders. The applicants’ written submissions are dated 22 November 2017 and consist of 11 paragraphs. Paragraphs 1 to 8 address the submission by them that no order for costs should be made in respect of the proceeding at first instance with the result that the primary judge’s order reserving those costs would stand. Paragraphs 9 to 11 address the submission by the applicants that an order should not be made that the costs of the proceeding at first instance (if made) be paid forthwith. The applicants did not make any submissions directed to whether the costs of the appeals should be paid forthwith.

17    The joint written submissions of the HPPL parties and the Gina parties are dated 29 November 2017. They consist of 13 paragraphs. They identify the two issues for determination as being the following:

… first, whether Ms Rinehart and Mr Hancock should be ordered to pay the costs of the HPPL parties, Mrs Rinehart and 150 Investments of the interlocutory applications before Gleeson J, or whether such costs should be reserved; and second, if Ms Rinehart and Mr Hancock are ordered to pay those costs, whether they should be payable forthwith.

Paragraphs 3 to 10 address the issue of whether the unsuccessful parties should pay the costs of the interlocutory applications before the primary judge and paragraphs 11 to 13 address the issue of whether the Court should make an order that the costs of those interlocutory applications be payable forthwith. Significantly, in paragraph 12(c) the HPPL parties and the Gina parties submit the following:

12    In the present case, the following factors heavily weigh in favour of the forthwith order sought by the HPPL Parties, Mrs Rinehart and 150 Investments:

…

(c)    Given that the costs of the appeal proceedings can be taxed forthwith as a matter of course, there is no reason in principle why the costs of the interlocutory applications the source of the appeals should also not be permitted to be taxed forthwith; and

18    The Court considered the submissions which had been filed and, on 15 December 2017, made final orders as follows:

1.    Leave to appeal be granted.

2.    The appeals be allowed.

3.    The cross-appeals be dismissed.

4.    The notices of contention be dismissed.

5.    The orders of the Court made on 26 May 2016 be set aside and in lieu thereof order:

(a)    that the proceeding brought in the Court by the applicants being NSD 1124 of 2014 be stayed under s 8(1) of the Commercial Arbitration Act 2010 (NSW) (CA Act) pending any arbitral reference between the parties or until further order, save and except for those claims made against those entities that are not parties to the relevant arbitration agreements, being Hope Downs Iron Ore Pty Ltd, Roy Hill Iron Ore Pty Ltd, Mulga Downs Investments Pty Ltd and Mulga Downs Iron Ore Pty Ltd; and

(b)    the first and second applicants to the main proceedings (being the first and second respondents to the appeals) pay the costs of the moving parties to the interlocutory application filed on 3 November 2014 in proceedings NSD 1124 of 2014 in connection with paragraph 9 thereof and the costs of the moving parties to the interlocutory application filed on 24 December 2014 in those proceedings, subject to Hope Downs Iron Ore Pty Ltd, Roy Hill Iron Ore Pty Ltd, Mulga Downs Investments Pty Ltd, and Mulga Downs Iron Ore Pty Ltd paying the costs related to the question as to whether those entities are parties to the arbitration agreement pursuant to s 2 of the CA Act.

6.    The claims made by the applicants in the underlying proceedings against Hope Downs Iron Ore Pty Ltd, Roy Hill Iron Ore Pty Ltd, Mulga Downs Investments Pty Ltd and Mulga Downs Iron Ore Pty Ltd be stayed on the same terms as the stay in order 5.

7.    Subject to the stays in orders 5 and 6 above, the matter be remitted to the primary judge for any application properly available in the light of the stays.

8.    The first and second respondents pay the appellants’ costs of appeal including the costs of the application for leave to appeal, subject to Hope Downs Iron Ore Pty Ltd, Roy Hill Iron Ore Pty Ltd, Mulga Downs Investments Pty Ltd and Mulga Downs Iron Ore Pty Ltd paying the costs related to the question as to whether those entities are parties to the arbitration agreement pursuant to s 2 of the CA Act.

9.    Leave be granted nunc pro tunc to Wright Prospecting Pty Ltd to intervene on the condition that they bear their own costs of intervention.

19    The Court delivered reasons with respect to the outstanding issues (Hancock Prospecting Pty Ltd v Rinehart (No 2) [2017] FCAFC 208) and, in the course of those reasons, said the following (at [3]–[6]):

3    Two issues arise: first, whether costs should be awarded against the first and second respondents (Bianca and John) in the application below, as well as on appeal, or whether the costs below be reserved to a time in the future; and secondly, whether costs (on appeal and below) should be payable forthwith.

4    Short submissions have been filed on these two questions. Our views are that the first and second respondents should pay the costs of both the appeal and the application below, but that no order for payment forthwith should be made.

5    Briefly our reasons are as follows. As to the first issue, the costs of the application and the appeals from it are related to the issues whether there should be a stay of the Court proceedings to refer the dispute to arbitration, and, as part of that question, whether there was any properly formulated attack on the arbitration agreements, and if so, what that attack was. These are issues different from whether or not the underlying claims are valid or not. The primary judge correctly approached the matter on the basis that the underlying claims were not to be decided. That is how the matter was approached on appeal. The respondents to the appeal contested and lost the stay and arbitration issues. Costs of that should follow the event. There is ample authority for treating the stay as separate in this way: Ansett Australia Ltd v Malaysian Airline System Berhad (No 2) [2008] VSC 156 at [20]; Amcor Packaging (Australia) Pty Ltd v Baulderstone Pty Ltd [2013] FCA 253 at [49]; Pipeline Services WA Pty Ltd v ATCO Gas Australia Pty Ltd [2014] WASC 10 (S) at [33]; Re Ikon Group Ltd (No 2) [2015] NSWSC 981 at [25]; Novawest Contracting Pty Ltd v Brimbank City Council [2015] VSC 679 at [34]; Australian Maritime Systems Ltd v McConnell Dowell Constructors (Aust) Pty Ltd [2016] WASC 52 (S) at [27]; John Holland Pty Limited v Kellogg Brown & Root Pty Ltd (No 2) [2015] NSWSC 564 at [46]-[47]; Comandate Marine Corp v Pan Australia Shipping Pty Ltd [2006] FCAFC 192; 157 FCR 45 at 110-111 [253] and 111 [255]; and AED Oil Ltd v Puffin FPSO Ltd (No 2) [2010] VSCA 109 at [3] and [12].

6    As to the second issue, there is no reason why in justice these costs should be paid forthwith. The costs will be large. That is a result of how both sides have treated the applications. With some exception in oral address, no stone has been left unturned, no opportunity for opposition passed up, and no proposition in writing expressed otherwise than to the fullest. Should the costs be payable forthwith that would raise the real risk of stultification of the substantive complaints of the first and second respondents to the appeal. That would be a matter of some real injustice. If the first and second respondents’ complaints are legitimate (whether to be vindicated in an arbitration or court proceeding) they would amount to very serious wrongs.

20    The Court did not make an order that costs be paid forthwith, but at the same time, it did make an order that the order for costs be stayed. It is important to note that what the Court was asked to do was to make an order that the costs be ordered to be payable forthwith. As to the costs at first instance, r 40.13 of the Rules is relevant. It is in the following terms:

40.13 Taxation of costs awarded on an interlocutory application

If an order for costs is made on an interlocutory application, the party in whose favour the order is made must not tax those costs until the proceeding in which the order is made is finished.

Note:    The Court may order that costs of an interlocutory application be taxed immediately.

21    The equivalent rule in the 1979 Rules was O 62, r 3(3) and that rule has been considered in a number of authorities (see the authorities referred to in Rafferty v Time 2000 West Pty Limited (No 3) [2009] FCA 727; (2009) 257 ALR 503 at [22] and [23]).

22    As to the costs of the appeals which are proceedings (see the definition of proceeding in s 4 of the Federal Court of Australia Act), r 40.14 of the Rules is relevant. It is in the following terms:

40.14 Order for taxation not required

If these Rules or an order of the Court entitle a party to costs, the party may have those costs taxed without an order directing taxation.

23    As we have indicated, there was an appeal by the applicants to the High Court of Australia. The appeal was dismissed with costs. A cross-appeal by Roy Hill Iron Ore Pty Ltd, Hope Downs Iron Ore Pty Ltd and Mulga Downs Iron Ore Pty Ltd was allowed (Rinehart v Hancock Prospecting Pty Ltd; Rinehart v Rinehart [2019] HCA 13; (2019) 366 ALR 635). By order 4 of its orders, the High Court set aside orders 5, 6 and 8 of the orders made by this Court on 15 December 2017 and in their place made the following orders:

5.    The orders of the Court made on 26 May 2016 be set aside and in lieu thereof order:

(a)    that the proceeding brought in the Court by the applicants being NSD 1124 of 2014 be stayed under s 8(1) of the Commercial Arbitration Act 2010 (NSW) (CA Act) pending any arbitral reference between the parties or until further order, save and except for those claims made against Mulga Downs Investments Pty Ltd; and

(b)     the first and second applicants to the main proceedings (being the first and second respondents to the appeals) pay the costs of the moving parties to the interlocutory application filed on 3 November 2014 in proceedings NSD 1124 of 2014 in connection with paragraph 9 thereof and the costs of the moving parties to the interlocutory application filed on 24 December 2014 in those proceedings, subject to Mulga Downs Investments Pty Ltd paying the costs related to the question of whether it is a party to the arbitration agreement pursuant to s 2 of the CA Act.

6.     The claims made by the applicants in the underlying proceedings against Mulga Downs Investments Pty Ltd be stayed on the same terms as the stay in order 5.

8.     The first and second respondents pay the appellants’ costs of appeal including the costs of the application for leave to appeal, subject to Mulga Downs Investments Pty Ltd paying the costs related to the question as to whether it is a party to the arbitration agreement pursuant to s 2 of the CA Act.

24    The orders made by the High Court varied the orders made by this Court, but only to the extent necessary to reflect the Court’s decision on the cross-appeal. Otherwise, the orders were in the same terms as the orders made by this Court.

25    The HPPL parties and the Gina parties advanced a preliminary point that this Court had no jurisdiction or power with respect to order 8 because that order was made by the High Court as part of paragraph 4 of its orders and not by this Court.

The Jurisdiction or Power Point

26    The HPPL parties and the Gina parties contend that the applicants’ Applications should be dismissed because order 8 of this Court was set aside by the High Court and the relevant costs order is order 4 made by the High Court on 8 May 2019. The contention is that only the High Court can construe, vary or amend the relevant costs order.

27    The HHPL parties and the Gina parties submit that the decision of the High Court in Aktas v Westpac Banking Corporation Ltd (No 2) [2010] HCA 47; (2010) 241 CLR 570 supports their argument. In that case, Mr Aktas succeeded in his appeal to the High Court and orders for costs in favour of Westpac Banking Corporation (Westpac) which had been made in the courts below were set aside by the High Court and costs orders in favour of Mr Aktas were made. Westpac had made offers to Mr Aktas in relation to his claim and it made an application to the High Court for that Court to vary the costs orders it made having regard to those offers. The High Court rejected the application to vary the costs order on the ground that Westpac should have foreshadowed an application for a special costs order at the hearing of the appeal or made the application at the time at which judgment was delivered by the Court.

28    The HPPL parties and the Gina parties contend that, in the same way, the applicants should have foreshadowed a variation or amendment to the costs orders at the hearing before the High Court or made such an application for a variation or amendment at the time judgment was delivered by the High Court.

29    The HPPL parties and the Gina parties accept that the position would be different had the High Court remitted the question of the costs in the courts below to those courts as the High Court did in Equuscorp Pty Ltd v Glengallan Investments Pty Ltd (No 2) [2005] HCA 5; (2005) 79 ALJR 564. However, that is not what the High Court did in this case.

30    We do not think these cases advance the issue beyond what is to be gleaned in any event from the general principles relating to statutory appeals involving this Court and the High Court.

31    The HPPL parties and the Gina parties submit that, in light of the fact that the relevant costs order is order 4 made by the High Court, none of the four sources of power relied on by the applicants is engaged.

32    First, they submit that the implied power in this Court to vary or amend its own orders (Lawrie v Lees (1881) 7 App Cas 19 at 34–35) or correct its own record (Mellor v Swire (1885) 30 Ch D 239 at 243) is not engaged because the relevant costs order is that of the High Court.

33    Secondly, they submit that the power in r 41.01 of the Rules to make a direction about the enforcement or execution of an order is limited to an order of this Court and does not extend to an order of the High Court.

34    Thirdly, they submit that the power in r 39.05(e) of the Rules to vary an order or to make a supplemental or ancillary order on the basis that the order as made does not reflect “the intention of the Court” is not engaged because the intention referred to in the rule is that of the Court which made the relevant costs order and, in this case, that was the High Court, not this Court.

35    Finally, they submit that the power in r 41.03 of the Rules to stay a judgment or order does not give this Court the power to stay an order of the High Court.

36    In response to the jurisdiction or power point, the applicants made the following submissions.

37    First, they submit that it is a nonsense to suggest that the applicants must approach the High Court for an order by reference to that Court’s intention with respect to the time at which the appeal costs must be paid in circumstances in which that question was never raised in the appeal or cross-appeal before the High Court. It is correct to say that that question was never raised in the appeal or cross-appeal before the High Court.

38    Secondly, the applicants submit that, although in form the High Court set aside this Court’s order and made another order in its place, the fact is that, in substance, the High Court upheld this Court’s order. The only variation to this Court’s order followed the success of the cross-appeal and that variation is irrelevant for present purposes. This point can be seen by setting out order 8 made by this Court with the deletions made by the High Court in brackets:

8.    The first and second respondents pay the appellants’ costs of appeal including the costs of the application for leave to appeal, subject to [Hope Downs Iron Ore Pty Ltd, Roy Hill Iron Ore Pty Ltd,] Mulga Downs Investments Pty Ltd [and Mulga Downs Iron Ore Pty Ltd] paying the costs related to the question as to whether [the words those entities are parties; replaced by “it is a party”] to the arbitration agreement pursuant to s 2 of the CA Act.

39    Thirdly, the applicants submit that if the contention of the HPPL parties is that it is taxing its costs of the appeal not only pursuant to order 4 made by the High Court, but also pursuant to the High Court Rules 2004 (Cth) in relation to the taxation of costs, then its act in filing the bill of costs in this Court is incompetent. The HPPL parties appear to be saying that (so the applicants contend) because they refer to and rely upon r 50.02.2(b) of the High Court Rules which is the equivalent of r 40.14 of the Rules of this Court.

40    The orders which the High Court made in the place of this Court’s orders and, in particular, the order in paragraph 8 are now taken to be the orders of this Court. Absent a special order by the High Court, the costs in proceedings in this Court are taxed in this Court and that is done in accordance with the Rules of this Court. The HPPL parties correctly recognised this when they filed their bill of costs in each appeal in this Court. That means also that unless that Court orders otherwise, r 40.13 of the Rules prevents the taxation of costs of the proceeding at first instance until it is finalised. At the same time, not every rule of this Court applies. As we explain below, we do not think that the costs order, for example, could be stayed by this Court.

41    The arguments raised by the applicants face considerable difficulties, although it is not strictly necessary for us to deal with them because, as we will explain, even had order 8 stood as the operative order in the relevant sense, we would not make any of the orders sought by the applicants. The difficulties are as follows. An obvious difficulty in considering the intention of this Court in making order 8 is that it is no longer the operative costs order. More importantly, and additionally or in the alternative, whichever source of power is being considered, whether it be the implied power and r 39.05(e) of the Rules or r 39.05(e) standing alone or r 41.01 or r 41.03 of the Rules, it is very difficult to avoid the conclusion that the true effect of what the applicants are now seeking is a stay of the costs order made by the High Court. This Court does not have the power to stay an order of the High Court (Macintosh v Dun (1906) 6 SR (NSW) 451; Bechtel v Goode (1904) 7 WALR 112; Peacock v DM Osborne & Co [1907] HCA 42; (1907) 4 CLR 1564).

The Merits of the Applications

42    The discussion and conclusions which follow are based on the assumption that this Court has jurisdiction or power to make one or more of the orders sought by the applicants.

43    The applicants put their arguments in two ways, that is, first as a construction argument and then, if that fails, as a case for a variation of the order. In truth, the two arguments overlap to a very substantial degree. As far as the construction argument is concerned, it is not suggested, for example, that considering only the terms of order 8, the order prohibits the taxation of the costs of the appeals or the payment of such costs until the determination of the proceedings at first instance. As far as the variation case is concerned, it is not suggested, for example, that a variation is called for in light of a change in circumstances since the order was made. Both of the applicants’ arguments rely on what is said by the applicants to be the clear intention of this Court and, either the meaning of the order is to be given effect, or to the extent that the meaning is not clear, it should now be made clear by a variation, or supplemental or ancillary order or direction under r 41.01 or a stay under r 41.03 of the Rules.

44    The applicants submit that this Court’s intention in making order 8 was that the costs of the appeals were not to be payable forthwith and, in fact, were not to be payable until the proceedings at first instance were finalised. That intention is clearly shown (so the submission goes) by the following matters.

45    First, the HPPL parties and the Gina parties sought an order against the applicants that the costs of the appeals be paid forthwith. Secondly, this Court refused to make such an order. Thirdly, this Court made it clear in its reasons that no order for the payment of costs forthwith should be made (at [3]) and said that the costs of the proceedings at first instance (i.e., the interlocutory applications) and the costs of the appeals will be large and that should costs be payable forthwith, that would raise the real risk of stultification of the substantive complaints of the applicants which would be a matter of real injustice (at [6]).

46    The applicants submit that, in these circumstances, order 8 is to be construed as prohibiting the taxation of the costs of the appeals pending the finalisation of the proceedings at first instance. Order 8 means that there should be no further proceedings with respect to the bill of costs filed by the HPPL parties in each appeal until the finalisation of the proceedings at first instance. To give effect to order 8 as properly construed, the Court should make an order of that nature, either pursuant to the implied power of the Court, or as a direction about the enforcement or execution of the order under r 41.01 of the Rules.

47    The alternative, albeit as we have said, overlapping submission of the applicants, is that even if this is not strictly what order 8 means, nevertheless order 8 should be varied to give effect to the clear intention of the Court, or order 8 should be stayed under r 41.03 of the Rules. Again, in relation to this argument, the applicants rely on the implied power of the Court, or, in the alternative, the power in r 39.05(e) to vary the order or to make a supplemental or ancillary order.

48    In response to these submissions, the HPPL parties and the Gina parties put the following submissions.

49    First, they submit that order 8 relates to the costs of the appeals and it is not affected by r 40.13 of the Rules unlike order 5(b) which deals with the costs of the interlocutory applications at first instance. The costs of the appeals are governed by r 40.14 of the Rules which provides that a party entitled to costs may tax those costs without an order directing taxation. For order 8 to avoid the consequences of r 40.14, there would need to be a qualification or proviso in the order itself and there is none. If it is relevant, r 50.02.2(b) of the High Court Rules is to the same effect as r 40.14 of this Court’s Rules.

50    Secondly, they submit that the context in which order 8 was made by this Court and, in particular, the submissions of the parties, clearly shows that the dispute between the parties related to the costs of the proceeding at first instance. As we have previously said, in their written submissions, the applicants did not make any submissions about the costs of the appeals.

51    Thirdly, they submit that despite the fact that they sought the inclusion of the word “forthwith” in the order relating to the costs of the appeals, the inclusion or exclusion of the word was, in fact, “immaterial”. Rule 40.14 operated according to its terms irrespective of whether or not the word “forthwith” was included.

52    Fourthly, the HPPL parties and the Gina parties submit that insofar as the applicants’ Applications involve an application to make a new order preventing the taxation of the costs of the appeals, such an order should not be made because circumstances have materially and relevantly changed since this Court made its orders. Affidavit evidence given by the solicitor for the HPPL parties is to the effect that the first applicant (Bianca) is trustee of Hope Margaret Hancock Trust (HMHT) and legal owner of 23.45% of the shares issued in HPPL. The beneficiaries of the HMHT are the applicants, Hope Rinehart Welker and Ginia Hope Francis Rinehart. HPPL paid dividends of approximately $214 million to the HMHT between 2015 and June 2020. The evidence also identifies the many proceedings involving the HPPL parties or their related entities on the one hand, and the applicants as applicants, or at least as active participants, in proceedings on the other, and identifies instances in which costs orders have been made requiring the applicants or the HPPL parties to pay the other parties’ costs of a particular application. It is not necessary for us to set out the details.

53    There were a number of specific points made by the HPPL parties and the Gina parties about the limits on the sources of power relied on by the applicants which we note for the sake of completeness.

54    With respect to the Court’s power in r 40.01 to make directions about the enforcement or execution of an order, it is submitted that the rule is engaged only in circumstances in which there is evidence that an order is being disobeyed and there is no evidence of that in this case (Food Channel Network Pty Ltd v Television Food Network GP (No 3) [2010] FCA 1112 at [15]).

55    With respect to the Court’s power to set aside or vary an order if it does not reflect the intention of the Court (r 39.05(e)) and, leaving aside the point that it is the intention of the High Court and not this Court which is relevant, it is submitted that: (1) the power in r 39.05(e) should only be exercised where the circumstances are exceptional (Australian Securities and Investments Commission v ActiveSuper Pty Ltd (No 4) [2013] FCA 318 at [6]) and that cannot be said of the circumstances in this case; and (2) the power in r 39.05(e) is generally not exercised unless it can be shown that without fault on the applicant’s part, he or she had not been heard on a relevant question (Deputy Commissioner of Taxation v Hua Wang Bank Berhad (No 2) [2010] FCA 1296; (2010) 81 ATR 40 at [10]).

56    In our opinion, the applicants’ Applications should be dismissed. The Court declines to make any order in relation to order 8 or to stay that order, even assuming it had jurisdiction or power to do so.

57    In our opinion, although the application in relation to when costs were payable proceeded on the correct basis in relation to the costs of the proceeding at first instance, it did not proceed on the correct basis in relation to the costs of the appeals.

58    The HPPL parties and the Gina parties applied for the payment of the costs of the appeals “forthwith”. They did not need to do that in light of r 40.14 of the Rules, a matter which they now accept. In fairness to those parties, they did say in their joint written submissions dated 29 November 2017 that the costs of the appeal proceedings could be taxed forthwith as a matter of course. However, it would have assisted the Court had they clearly and expressly withdrawn that part of their application.

59    For their part, the applicants made no submissions about the timing of the payment of the costs of the appeals. Had they turned their mind to the issue (assuming for present purposes that they did not) they may well have realised that, in fact, they were the parties who needed an order in relation to the timing of payment of the costs of the appeals. The applicants may have then identified and considered the difference between the operation of r 40.13 of the Rules and a stay of an order not within that rule. If one proceeds on the basis that they did know these matters and, as is the fact, they took no action, then, in our view, they cannot complain now if the Court declines to make any of the orders which they seek.

60    Putting the matter in another way, had the true nature of the issue concerning the timing of the payment of the costs of the appeals been exposed, then there would have been no need for these Applications because the circumstances leading to them would not have arisen. Had the HPPL parties and the Gina parties not made an application which they did not need to make, or had the applicants identified the order they in fact needed, then whether an order suspending the operation of r 40.14 or staying the order should be made, would have been squarely addressed at that time. In our opinion, there is no basis for making any of the orders sought by the applicants.

Conclusions

61    There is nothing in order 4 made by the High Court insofar as it deals with the costs of the appeals to this Court which operates as a stay of the orders. Those costs may be taxed in this Court. Insofar as the Rules of this Court apply to that taxation, there is nothing to prevent an immediate taxation. There is no need for an order directing taxation (r 40.14 of the Rules) and r 40.13 does not apply to the costs of the appeals.

62    The applicants’ Applications must be dismissed. The applicants must pay the respondents’ costs of those Applications.

Associate:    

Dated:    3 March 2021

SCHEDULE OF PARTIES

SCHEDULE OF PARTIES