Environmental Defenders Office did not breach funding rules while opposing Santos gas project, review finds

Tanya Plibersek ordered investigation after judge accused law firm of ‘subtle coaching’ of Tiwi Island traditional owners during legal challenge

The Environmental Defenders Office did not breach the conditions of its $8.2m in federal funding, according to a government review of the legal firm’s conduct.

The environment minister, Tanya Plibersek, requested the review after a federal court judgment in January made sharp criticisms of the EDO’s conduct in a legal matter against Santos.

The case, brought by Tiwi Island traditional owners, argued Santos had not properly assessed submerged cultural heritage near an area it proposed to construct a pipeline for its Barossa offshore gas project off the Northern Territory.

The traditional owners sought an injunction on pipeline works until the gas company submitted a new environmental plan and it was assessed by the National Offshore Petroleum Safety and Environmental Management Authority (Nopsema).

The case was dismissed in January and the judgment by Justice Natalie Charlesworth made adverse findings against the EDO that one of its lawyers and a cultural heritage consultant engaged in a form of “subtle coaching” in a meeting with Tiwi islanders. Charlesworth also found that evidence from one expert witness involved “confection”.

After the judgment, the opposition leader, Peter Dutton, vowed to defund the EDO if the Coalition won the next election.

The former prime minister Tony Abbott cut the EDO’s funding in 2013, ending 20 years of commonwealth funding for the public interest law firm. The funding was restored by the Albanese government.

Plibersek’s department sought independent legal advice on whether the conduct described in Charlesworth’s judgment breached the EDO’s grant conditions.

The business grants hub within the Department of Industry, Science and Resources, which administers the grant agreement, also assessed whether any possible fraud had occurred in relation to the grant agreement.

“The legal advice was that the comments in the judgment do not provide a reasonable basis to conclude that the EDO had breached the terms of the grant agreement,” the final report states.

The business grants hub also found the EDO “has been compliant with the grant conditions to date” and there was no evidence indicating possible fraud.

The report says, based on this advice, the Department of Climate Change, Energy, Environment and Water had concluded the EDO was not in breach of its agreement.

But the department did find further steps should be taken and said it was working with the business grants hub to implement “additional assurances” in relation to the grant agreement and to negotiate some variations to “expressly clarify the standards expected by the Commonwealth of the EDO”.

The EDO chief executive, David Morris, welcomed the review’s findings.

“We are proud to deliver high-quality legal services under the terms of the federal government’s grant agreement, and to represent those seeking to exercise their right and to protect nature and the climate,” he said.“Without federal support, many Australians would be unable to access the legal system or participate fully in environmental decision making.”

The Coalition’s environment spokesperson, Jonno Duniam, said the review findings showed the grant to the EDO “did not have appropriate conditions in place to protect the taxpayer”. “Due diligence from the Federal Government was completely lacking.”