Clive Palmer’s Singapore-based company Zeph Investments is suing Australia for $296bn, enlisting the help of former attorney general Christian Porter in a landmark case arguing a breach of the Asean free trade deal.
The case relates to Western Australia’s extraordinary law to prevent Palmer from seeking compensation over his massive Pilbara iron ore project, which was rejected by the WA government.
In a notice of arbitration dated 28 March, seen by Guardian Australia, Palmer as director of Zeph Investments claimed that the commonwealth breached its obligations on investments and compensation for taking property.
Porter, who as attorney general intervened in the high court in favour of Palmer’s case to reopen WA’s border during the pandemic before the commonwealth withdrew from the case, is listed as the lead lawyer. Nine other lawyers including Palmer’s wife, Anna Palmer, are also listed.
Guardian Australia revealed in 2020 that Zeph Investments Pty Ltd had requested consultations about possible litigation. The investor-state claim against Australia was listed as a risk to the federal budget.
Palmer’s mining company Mineralogy was in dispute with WA over the stalled Balmoral South iron ore project, which was rejected by the then-premier Colin Barnett in 2012.
When Palmer sought arbitration of the dispute in the Queensland supreme court the WA parliament rushed through legislation to extinguish his claim, warning it could cost the state up to $30bn.
The notice of arbitration claims that the WA premier, Mark McGowan, and attorney general John Quigley planned legislation to “effectively destroy the claimant’s iron ore mining investments in Western Australia”.
The notice says the WA government “unilaterally absolved itself of any liability for a proven breach of a state agreement in a long-running commercial dispute with the claimant’s subsidiary … and, quite literally, terminated and invalidated the arbitration process by which damages for that proven breach were imminently to be determined”.
“Australia bears responsibility for measures and actions undertaken by the Government of Western Australia,” it said.
In October 2021 Palmer lost a case in the high court challenging the legality of the WA law. The court unanimously ruled that the WA law was “not invalid or inoperative in its entirety”.
The dispute was also the subject of a defamation case between the billionaire and the premier, in which Palmer was awarded $5,000 damages and McGowan $20,000.
In August 2020 Quigley rejected suggestions that WA was denying Palmer natural justice, telling journalists that “justice is West Australians not giving Clive Palmer $30bn”.
The claim seeks US $198,202,414,285 in damages plus interest and costs, due to alleged loss of a contractual entitlement, “moral damages” and “sovereign risk” to other projects.
The commonwealth has 30 days to formally respond to Zeph Investments’ notice of dispute.
A spokesperson for the attorney-general, Mark Dreyfus, said “we will vigorously defend Australia’s interests”.
“The commonwealth will work with Western Australia to ensure Australia’s interests are protected.
“As these matters have now become the subject of an investor-state claim, it would not be appropriate to provide further comment at this time.”
In a statement Palmer said “if any windfall was to come to Mineralogy, the funds would be used for public good”.
He suggested this could include spending on WA hospitals and a “new independent daily newspaper in WA which doesn’t rely on cartoons to sell copies”, in reference to a report in the West Australian.
