Clive Palmer’s Legal Strategy – Successful or Regretful?

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Clive Palmer might be Australia’s sweetheart politician, but he is not always so successful in the Courts. Mr Palmer has had a variety of claims brought against him – many of which have been aired publicly on television programs such as “Q and A”, and he is not having a lot of success with his legal strategy.

One particular case – Mineralogy Pty Ltd v Sino Iron Pty Ltd, heard in the WA Supreme Court, received particularly harsh comment from The Honourable Justice James Edelman with respect to the strategy Mr Palmer’s team adopted. The case concerned a claim for costs for a frustrated contract. Mineralogy, Mr Palmer’s company, changed their claim repeatedly:

  1. Mineralogy brought a claim for frustration, which was later abandoned;
  2. Mineralogy amended their claim twice;
  3. Mineralogy sought urgent Discovery, which was later abandoned;
  4. Mineralogy sought an urgent hearing to respond to their opponents’ defences, which was later abandoned; and
  5. Mineralogy made radical changes to their statement of claim and sought urgent trial on this new issue of frustration.

Edelman J criticised Mineralogy’s strategy as unreasonable and inappropriate. Mineralogy’s intentions to reduce the time and cost of the action, were “absurd” as prior to bringing the new frustration claim there was no expert evidence, no trial bundle, no legal submissions with respect to this issue and the specific frustration claim brought was complicated and time-consuming. It had been clearly communicated during pre-trial conferences that a frustration claim would carry significant time and monetary commitment. The defendant Citic Pacific Ltd spent 2565 hours on responding to the frustration claim.

These large costs and added litigation duration, caused Edelman J to find Mineralogy’s withdrawal of their frustration claim “so unreasonable that an award of indemnity costs should be made”.  This is an award of costs payable by Mineralogy in favour of Citic for the cost Citic had incurred in undertaking this aspect of the proceeding and was also payable immediately.  These awards are usually made for causing delay, making unnecessary or frivolous claims, or otherwise abusing the process of the court system.  Edelman J also awarded costs against Mineralogy for Citic’s costs in response to the frustration claim.

Given many claims last over several years, constant amendment of a party’s claim can mean significant financial uncertainty for opposing parties, and the witnesses must “bear the strain of impending litigation and the disappointment when it is not brought to an end”.

It is important that when a party chooses its legal strategy, it thinks comprehensively about the entire proceeding and has a timeframe and strategy for its resolution or determination.  Once you have articulated your position, you should avoid amending it. Mr Palmer claimed on the Q & A program that he was “knocking the case out”, when in reality Edelman J was opposed to his strategy.

A link to Justice Edelman’s decision can be found here.

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