Absurd Rocky Hill decision tarnishes rule of law

While the Queensland government’s review of the Adani project is a farce, the decision of the NSW Land and Environment Court to block the proposed coalmine at Rocky Hill is a tragedy.

In narrowly economic terms, much more is at stake with Adani.

But the Rocky Hill decision is such a travesty of justice it casts a shadow over the standing of our judiciary. Of course, in both cases, the dysfunction stems from a common core. The environmental approval process was designed as an exercise in balancing costs and benefits, objectively weighing competing interests in the light of the consequences for the community as a whole.

However, the opponents of coalmining do not view the issues in those terms. Rather, they regard them as involving fundamental moral choices that cannot be offset by other considerations, no matter how substantial those considerations might be. There is, as a result, an irreconcilable conflict between their approach, which brooks no compromise, and environmental approval processes that focus on trade-offs.

Ultimately, that conflict can only be resolved politically: parliaments can, if they wish, ban coalmining. But until they do the task of the courts is to dispassionately apply the law, regardless of whether individual judges agree or disagree with it.

Instead, starting from the premise that coalmining is undesirable, the decision in the Rocky Hill case contorts facts, logic and analysis. In doing so, it advances claims that are manifestly absurd.

For example, misinterpreting the evidence, the court contends that the higher the unemployment rate in an area, the smaller will be the “worker benefits” from opening a mine.

In fact, the opposite is true. In areas with high unemployment, opening a mine will have little effect on wage rates because new workers can be recruited without offering wage rises.

The mine will, however, have a large impact on incomes as people who were unemployed move into jobs, yielding far greater economic, social and fiscal benefits than would accrue in an area already at full employment.

Far from telling against the project, as the court contends, rising unemployment in the mine’s vicinity should therefore have counted in its favour.

As well as falling into absurdity, the approach the court adopts drives it into glaring inconsistencies. Thus, the decision repeatedly emphasises the importance of the state government’s guidelines for the assessment of mining proposals. Moreover, in every instance I was able to find in which the mine’s proponents departed from those guidelines, those deviations, no matter how justified, are treated as a grounds for rejecting the proponents’ contentions.

What the court nowhere says, however, is that the guidelines it relentlessly deploys to criticise the mine’s proponents specifically warn against consideration of so-called “scope 3” emissions, that is, the “secondary” emissions of “those who purchase the product — including those emissions occurring overseas”.

Instead, contrary to the plain text of the explanatory document, which states that it is appropriate to take account of direct emissions “but not (of) … scope 3 emissions”, the court places those “scope 3” emissions at the very heart of its analysis.

Yet, even then the court manages to contradict itself. For example it dismisses as speculative the proposition that because the coal that would have been mined at Rocky Hill can and will be obtained from elsewhere, any emissions its use would have caused will occur regardless.

However, just a few paragraphs later, in attempting to show that steel production can continue unimpeded, the court contends, without any signs of hesitation, that “demand for coking coal for use in steel production will be able to be met by supply from other Australian mines if the Project is not approved” — vitiating the claimed benefit of the decision in reducing global emissions.

To make matters worse, the court mangles basic concepts, voiding them of their substance.

The discussion of wage premiums is a striking case in point.

In an analysis that is terminally muddled, the court asserts that the relatively high wages in mining merely compensate for the onerous work mining involves, the implication being that those who might otherwise have secured jobs at the mine would be every bit as well off earning a third as much washing dishes in the local cafe.

Finally, when it comes to summing up, the court argues that it is appropriate to discount even the trivial gains it concedes the project might bring. Because there is a degree of uncertainty around the mine’s impacts, the court says “the benefits might be smaller” and “the costs … much greater than anyone has estimated”.

It should have been apparent, however, that exactly the same logic implies that the benefits might prove larger and the costs much smaller than it believes, contradicting the inference the court incorrectly seeks to draw.

Of course, none of that means the proposal ought to have been approved: that depends on what a proper assessment would find.

But it is difficult to deny that the decision is far from presenting such an assessment.

The immediate risk is that the court’s reasoning, despite its myriad flaws, will set a precedent, ending coalmining in the state as permits come up for modification or renewal.

But there is a much broader harm as well.

After all, the requirement that judges give reasons for their decisions, which historically distinguished English law from its continental counterparts, springs from an enduring fear of the arbitrary exercise of power. And already by the 18th century it was recognised that the reasons had to be good ones: they could not be fig-leaves for the biases, prejudices and personal commitments of unelected judges. Most importantly, they had to establish a clear and ­rational relation between the decision and the law of the land.

That was not just a crucial safeguard against the abuse of judicial power; it was also a way of securing and entrenching the legitimacy of the judiciary — a legitimacy that, for over two centuries, has encouraged Australians to vest in their courts a degree of independence other countries envy.

But the Rocky Hill decision is not “British justice”. Its absurdities and internal contradictions are in stark contrast to the norms Australians demand and can legitimately expect. For so long as that decision is allowed to stand, our system of justice will be tarnished, and the rule of law with it.