Three years after the northern cattle industry had access to its major market suddenly cut off by the-then Gillard Government’s suspension of cattle exports to Indonesia, businesses affected by the June 2011 ban have launched a class action seeking damages against the Commonwealth.
Hundreds of northern cattle producers, exporters, musterers, transporters and other cattle industry businesses were impacted when cattle exports to their region’s primary – and for some producers only – cattle market were suddenly halted by agriculture minister Joe Ludwig on June 7, 2011.
The Minister’s far-reaching decision came one week after an ABC’s Four Corners program aired footage showing Australian cattle being mistreated in Indonesian abattoirs.
The ABC program triggered a major media and public backlash against the live export trade, and set in motion an orchestrated social-media campaign led by Animals Australia and the RSPCA calling for the trade to be banned.
The Minister’s initial response was to issue a control order banning the export of Australian cattle to the 12 Indonesian abattoirs identified in the Four Corners footage.
However, less than one week later, with thousands of emails pouring into his inbox demanding the trade be banned, the Minister issued a second control order applying a blanket ban on all cattle exports to Indonesia for a period of six months.
Lawyers for the applicants in the class action will argue that the Australian Government’s first control order on June 3 to ban exports to the 12 abattoirs involved was a fair, rational and reasonable response.
However, the second control order issued on June 7 to ban the entire trade was unreasonable on several grounds and had no justifcation for being made.
They will argue the decision was made without any new information and without adequate legal advice; was not proportionate to the animal welfare issues involved; was made with a reckless disregard for the likely impacts, including the risk of creating a much larger animal welfare issue in northern Australia than that documented in Indonesia; and was made with unreasonable urgency and secrecy.
The open class action, filed in Canberra yesterday afternoon, currently involves numerous applicants. The lead applicants are the Brett Cattle Company from Waterloo Station in the NT. The identities of all other applicants involved have not been publicly disclosed, but the list is known to include small family-sized and large corporate-owned cattle producers (including Australian Agricultural Co for example), livestock transporters, exporters, musterers, feed providers and various businesses that service the northern cattle industry.
However, with businesses affected from Western Australia right across to the Queensland Gulf, the number of applicants is expected to grow significantly in coming weeks as other affected entities register to join the class action.
The class action is being handled by Minter Ellison in Canberra, and also has the backing of the Australian Farmers Fighting Fund.
Impact ‘like a cancer’
Northern Territory Cattlemen’s Association executive director Tracey Hayes likens the effect of the ban to a “cancer or a rust” that is still hurting many balance sheets three years after the event.
For some businesses the impact was terminal, for many others, recovery will take years, she said.
Nor was the impact just financial. The ban caused an enormous amount of emotional and social pain for many families and communities across the north.
“We need to move on and we’re working very hard to move on, but we can’t forget,” she said.
“We need to ensure this never happens again, that the appropriate channels are adhered to in future, and that no other industry has to go through this.
“It is as much about that as it is about seeking compensation.”
Independent Evaluation supports merit of industry’s case
The commencement of class action proceedings against the Commonwealth follows three years of unsuccessful attempts by the affected parties to get the Gillard and then Abbott Governments to the table to discuss the Government’s liability for the impacts caused by the temporary ban.
As part of that prolonged negotiation process, Minter Ellison last year engaged one of Australia’s top silks, ex Federal Court Judge Roger Gyles QC, to undertake a “neutral evaluation” of the industry’s case, and to assess whether there was a meaningful prospect of liability being established.
In his ensuing report, the QC emphasised that his role was to conduct the evaluation as an independent third party, noting that he approached the matter as if he were jointly retained by all of the parties involved.
Findings of neutral evaluations can often be quite subtle and open to interpretation, but the September 2013 Gyles report leaves little doubt as to the strength the ex Federal Court judge sees in the industry’s case.
He concludes that there is a “substantial chance” that the Gillard Government’s second control order to ban the trade on June 7 “would be held to be so irrational as to be both unreasonable and out of proportion to the subject in the sense outlined in the authorities and so invalid”.
The Gyles Report’s findings are seen as providing a strong independent endorsement of the merits of the industry’s case from one of the best-credentialed legal minds in the field in the Commonwealth.
The report says internal Government documents show a remarkable degree of urgency and secrecy attached to the making of the second export control order. It notes that departmental officers “were obviously instructed to keep industry representatives and State and Territory officers in the dark”.
It also questions why Minister Ludwig so radically departed from the partial ban position on June 3 to the full ban position on June 7.
Nothing could be found in any Government documents to explain “such a striking U-turn”, he wrote.
He also noted that the Government made the decision to suspend the trade on animal welfare grounds without properly considering the animal welfare implications of its own decision:
“The prospect of thousands of cattle being left during the dry season with dwindling feed and water, losing weight, with the owners not being able to afford supplementary feeding and with no practical available slaughter alternatives, as outlined in the Minute, is a large scale animal welfare disaster which on any view would far exceed the poor handling of some of the animals exported to Indonesia.”
A case that the minister had acted with reckless disregard could be made, he concluded:
“The radical nature of what was proposed, the extraordinary urgency and secrecy with which it was effected, the lack of any rational explanation for the remarkable change in direction by the Minister, coupled with the lack of departmental advice and the recognition of the need for legal advice but for the decision to proceed without it, could well be held to amount to a situation in which the Minister recklessly disregarded his means of ascertaining the extent of his power.”
Govt did not engage in negotiations
Legal counsel representing the applicants said that the refusal of successive Federal Governments to engage in direct negotiations in the three years since the June 2011 ban has left them with no choice but to commence legal proceedings.
“No one likes to sue the Commonwealth, we wanted to make sure that we have done everything we possibly can to resolve this in some other way, but we just haven’t had that engagement so our hand has been forced,” Minter Ellison partner Andrew Gill said.
Estimates of the scale of damages incurred by northern cattle businesses as a result of the ban range from hundreds of millions of dollars and upwards.
However Mr Gill said it was far too early to put an accurate dollar figure on the level of damages the class action will ultimately be seeking.
Businesses impacted by the ban can contact the Minter Ellison Canberra office (02) 6225 3000.
Agriculture Minister Joyce reaction
A spokesperson for federal agriculture minister Baranby Joyce told Beef Central today that as the matter was before the courts, it is not appropriate to comment on the issue.
However, he said the Coalition Government will continue its efforts to rebuild and expand the live export trade following the 2011 live export ban.
“Since the Coalition came to office in September 2013, more than 1.3 million head of cattle have been exported, and the value of the live export trade, including cattle, buffalo, sheep and goats, between September 2013 and August 2014 has exceeded $1.4 billion,” the spokesperson said.
Ban one of the worst decisions ever made: NT Primary Industries Minister
Speaking in the NT Parliament today, Minister for Primary Industry and Fisheries, Willem Westra van Holthe, has given his full support to the Brett Cattle Company’s class action against the Commonwealth Government.
Mr Westra van Holthe said that the 2011 live export ban was one of the worst decisions the Commonwealth Government has ever made.
“This decision by the former Labor Government was reckless and caused considerable pain and hardship for Territorians on the land,” Mr Westra van Holthe said.
“The decision put international relations at risk, subjected the population of Indonesia to food security risk and overnight shutdown an industry that is planned years in advance.
“On the ground, the decision caused depression and pain to run throughout every vein of our industry.
“Within weeks of the ban, properties began appearing on the market. Many were old pastoral families who were forced to sell up.
“The pressure on our pastoralists was both financial and emotional; to this day depression remains a major issue for Northern Territory cattle producers.
“I will continue to do everything I can to grow our live cattle export industry and I stand by them in this time of reckoning.
“Joe Ludwig and former Prime Minister Julia Gillard should be held to account for the worst decision ever made by any Australian Government.
“The live export ban would never have happened under the leadership of the current Minister for Agriculture, Barnaby Joyce and Prime Minister Tony Abbott.”
- See today’s Beef Central news email at lunchtime today for further updates