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NuCoal says ICAC misled parliament, calls for inquiry

The NSW government has come under pressure to hold an inquiry into its anti-corruption agency after it produced a report for parliament that relied on testimony from a man with brain damage and amnesia.

That report, by the Independent Commission Against Corruption, was part of a series of reports from the commission that persuaded parliament to expropriate coal exploration licences issued by the previous Labor government.

The companies that held those licences, Cascade Coal and NuCoal Resources, believe the disclosure about ICAC’s brain damaged witness is the latest in a series of problems with the information that formed the basis for the expropriation.

NuCoal chairman Gordon Galt said parliament needed to conduct its own inquiry to determine who inside ICAC had been responsible for hiding a medical report outlining the problems of the brain damaged witness.

“The only way for parliament to reassert its confidence in the basis of the rule of law is to find out about all of this matter, not just bits of it as they dribble out,” Mr Galt said.

“There should be a parliamentary inquiry. Parliament has been misled and it has the ability to deal with the matter.”

Mr Galt’s call for an inquiry was triggered by the disclosure in The Australian that ICAC held a medical report outlining mental health problems with Paul Gardner Brook, its star witness at an inquiry known as Operation Jasper.

While the report from Operation Jasper was silent about what ICAC knew about Mr Brook, the report from its other coal inquiry, Operation Acacia, was silent about evidence given at closed hearings by ex-premiers Nathan Rees and Kristina Keneally.

The secret evidence of the two former premiers is at odds with the assessments in the Acacia report that went to parliament.

When the commission sent the Jasper report to parliament, it failed to mention that it held a medical report that says Mr Brook had suffered a brain injury that had left him with impaired cognitive abilities and vulnerable to suggestions about whether events had taken place.

That medical report was only disclosed by ICAC last month — almost five years after the ­commission praised his evidence.

Mr Galt’s view was in line with that of Cascade Coal director John McGuigan who pointed out that ICAC had told parliament that Mr Brook was a credible witness. “If ICAC were in possession of a medical report detailing Gardner Brook’s true mental condition it is not, in my view, a long bow to suggest that parliament was misled,” Mr McGuigan said.

Mr Galt said parliament might well have made a different decision about the exploration licences if it had all the facts.

Before the problems with Mr Brook’s mental health were disclosed, the state government last month rejected the latest appeals from both companies for the return of their exploration licences.

While the NSW government accepted ICAC’s recommendation to cancel the licences, it ­rejected an associated recommendation that innocent parties should be compensated.

In a statement last week to the Australian Securities Exchange, NuCoal said Premier Gladys ­Berejiklian had refused to meet the company and had rejected the latest call to return the exploration ­licence.

The statement raised the prospect that this meant the company’s US shareholders might eventually be compensated for the value of their lost asset, while Australian shareholders might miss out.

“NuCoal is continuing efforts on an international level with NuCoal’s US shareholders to bring an appropriate compensation proceeding against the Australian government under the US Free Trade Agreement,” the ASX was told. “Unfortunately, as previously advised, Australian shareholders in NuCoal will not be a party to any compensation that may arise from these efforts,” the statement says.

The FTA with the US guarantees that US-owned assets will not be taken by Australia other than by due process of law. It also says any expropriation will be followed by prompt and adequate compensation.

In a March 9 letter to Ms Berejiklian, Cascade’s Mr McGuigan wrote that his company had US and New Zealanders shareholders. “These shareholders have or will be exercising their rights under the relevant free trade agreements,” Mr McGuigan wrote.

Chris Merritt
Legal Affairs Editor

(WTF) used with permission

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