A CLASS action brought on behalf of thousands of farmers across two states against the Murray-Darling Basin Authority has failed after a judge ruled the agency owed water users no duty of care in relation to economic loss.

The action initially sought about $750 million when it was launched around seven years ago, with the claim later described as seeking up to $1.5 billion in damages, costs and interest, based on estimates of alleged economic losses.

The action was led by plaintiffs Doyle’s Farm Produce, John Gerard Doyle, Coobool Downs Pastoral Co, Rodney James Dunn and Valerie Jeanette Dunn.

They claimed the MDBA breached a duty of care to water entitlement holders central Murray region of southern New South Wales and the Goulburn Murray region of northern Victoria.

This related to two incidences around the Barmah Choke located where the River Murray passes through the Barmah-Millewa Forest.

The first involved a decision by the MDBA to release water at Yarrawonga Weir in October 2017, resulting in an estimated 40GL of water losses, or “overbank transfers”, into the adjacent Barmah-Millewa Forest.

The second was a decision to release water from mid-2018 which resulted in prolonged overbank transfers into the Barmah-Millewa Forest.

Water losses into the forest from this incident were estimated at more than 100GL.

The plaintiffs argued that less water would have been lost had the MDBA commenced the releases in June 2018, because the water could then have been released at a lower rate.

No duty of care

In the NSW Supreme Court on Monday, Justice Tim Faulkner dismissed the case and ordered the plaintiffs to pay the defendant’s costs.

Justice Faulkner found there was not a sufficient relationship between the parties.

“The role created for the Defendant within the statutory framework runs as far as allocation of water to the States and fulfilment of water orders from the States but no further,” Justice Faulkner said.

“The Defendant has no role in the allocation or other use of water by each State.

“The absence of a role for the Defendant in the allocation of water to individual water entitlement holders is incongruent with the Defendant owing the Plaintiffs a duty of care.”

Justice Faulkner also pointed to an inherent “conflict” in the MDBA’s role, which he found made it inconsistent with the agency owing a duty of care to water users in relation to economic loss.

“There is another aspect of the statutory framework which cannot be reconciled with the Defendant being subject to a duty to avoid economic loss to the Plaintiffs.

“Inherent in the waters of the Murray-Darling Basin being a valuable and scarce resource is conflict amongst those concerned with the waters’ use.

“The Defendant is required to conduct its functions in the face of conflict.

“Decisions made by the Defendant may benefit some interests and prejudice others.”

MDBA response

A MDBA spokesperson confirmed that the court had found in its favour on Monday.

“The Court found in favour of the MDBA,” the statement said.

“We will take some time to review the judgment in detail.

“As the matter remains subject to appeal rights, it would not be appropriate to comment further at this stage.”

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