Contemporary Issues in the Legislative Process

Thanks to Lorraine Finlay from Murdoch University for her summary and analysis of the information detailed below.

Background

The State government of Western Australia enters into agreements with mining companies relatively regularly. These agreements are part law, part contract. In 2002, the state government entered into an agreement with companies associated with Clive Palmer (Iron Ore Processing Agreement Act 2002).

First Balmoral South Proposal:

Under the above agreement, Clive Palmer submitted a proposal to develop the Balmoral South Iron Ore Project in 2012. This proposal was rejected by Colin Barnett (then minister for state development). There were a number of issues with the application, so it was rejected on the basis that it was invalid.

Clive Palmer's first damages claim:

Clive Palmer argued that the rejection of this proposal breached the 2002 agreement. Clive Palmer won this claim.

Modified Proposal:

Following the first arbitration, the government advised that Palmer would need to alter 46 conditions in the proposal. Palmer argued that these were unreasonable, and also breached the state agreement.

Second Balmoral South Proposal:

A second proposal was submitted and rejected in 2013.

Inaction:

No further action was taken between 2014-2017. The state government advised Mr Palmer that they were treating the proposal as having lapsed.

Second Arbitration:

In 2019 a second arbitration found that damages could be assessed over the matter.

Supreme Court Challenge:

The State government appealed the 2019 arbitral award in the Supreme Court. This was dismissed.

Registration and Scheduled Hearing:

Arbitrations were registered in the Supreme Court of Queensland (challenged by the WA government). A hearing was listed for 30 November 2020, to consider the damages. Clive Palmer revealed we was seeking damages of approximately $30 Billion.

The Act

Iron Ore Processing (Mineralogy Pty Ltd) Agreement Ammendment Act 2020 (WA)

In response to Clive Palmers $30 Billion claim, the State Government of Western Australia passed extraordinary legislation to avoid bankrupting the state. The yearly operating budget for the state is approximately $30. The WA Premier, Mark Mcgowan, stated the damages claim "would mean mass closure of hospitals, of schools, of police stations, mass sackings of public servants and child protection workers".

The key Provisions of the Act:

• The 2012 and 2013 Balmoral South proposals have no further effect

• Any arbitration proceedings concerning those proposals are terminated

• The two existing arbitral awards are invalidated

• Protects the State from any liability of any sort in relation to disputed matters, and removes any appeal or review in respect to these

• This protection extends to officers and agents of the State from liability, including criminal liability with respect to any conduct 'that is, or is connected with, a protected matter'

• Obliges Palmer and his companies to broadly indemnify the State, and prevents any appeals relating to the disputed matters.

• Removes application of freedom of information laws from the disputed matters

• The rules of natural justice do not apply to any conduct of the State with respect to these matters

• Provides a general regulation-making power to the State

Issues

"The ammendments moved in Parliament last night were due to a very unique set of complex circumstances. As such, the WA Government took very unique action against a very unique dispute on behalf of the people of WA. While some of the proposed amendments are unprecedented, it should be made clear the proposed amendments have no relevance to and are not proposed to be extended to any other such agreements". Mr. Paul Everingham (Chief Executive, Chamber of Minerals and Energy WA)

"This is perhpas the most offensive, repugnant piece of legislation that I have seen. It is offensive to the fundamental principles of our parliamentary democracy because of its delegation to legislation-making powers, its Henry VIII clauses, its interference in an ongoing legal dispute, its interference in and breakdown of the separation of powers and its trampling of someone's rights to natural justice and procedural fairness. What also makes this legislation so bad and offensive is its undermining of the rule of law". Aaron Stonehouse MLC

Rule of Law Issues

"McGowan has embarked on the most outrageous abuse of power we have seen from any government in Australia in the 120 years since Federation". Terry McCrann, writing in the Australian

"More fundamentally, the new law affects a principle on which our system of law is based. Citizens acquiesce to be governed by the State on the basis the State will govern according to the rule of law. The rule of law comprises a series of concepts, but are subject to the ordinary law of the land. Departure from that principle has the capacity to affect the foundation of our democracy". The Law Society of Western Australia Media Statement

The legislation has a number of rule of law issues such as:

• Legislating out of a specific legal dispute (Chapter 2 of the Constitution)

• Taking away rights without just compensation

• Retrospective application

• Party-specific legislation

• Creating sovereign risk

Government Reposnse to rule of law concerns:

"Far from it. The Amednment Act, having been passed through both houses of State Parliament, is the law." John Quigley MLA (Attorney General)

Procedural Concerns

The Bill was introduced into the Parliament on 11 August, and was passed and gratned Royal Assent on 13 August. This is does not allow for significant debate, especially over such a controversial piece of legislation. In June 2013, Mark McGowan said:

"It has been part of the standing orders and the time-honoured process of parliament in the Westminster system for a long period that we do not rush legislation through without time to consider it because doing so does not allow proper debate in its consideration and mistakes are made in the legislation".