Adelaide Parklands Preservation Assoc Inc v The Corporation of the City of Adelaide - [2008] SADC 38

DISTRICT COURT OF SOUTH AUSTRALIA
(Civil)
ADELAIDE PARKLANDS PRESERVATION ASSOC INC & ORS v THE CORPORATION OF THE CITY OF ADELAIDE
[2008] SADC 38
Judgment of His Honour Judge Barrett
11 April 2008
LOCAL GOVERNMENT - REGULATION AND ADMINISTRATION - MEETINGS
Conflict of interest - whether Councillors disentitled to vote - disclosed interest - whether body to which they were nominated by Council was a non-profit organisation and whether nomination not appointment by the Council to the body affected their entitlement to vote - held: Motor Sport Board was a non-profit organisation, but because Councillors were not appointed by the Council to the Board they were prevented from voting.

LOCAL GOVERNMENT - POWERS, FUNCTIONS AND DUTIES OF COUNCILS GENERALLY
Whether plaintiffs were persons affected by the resolutions of Council and thereby had standing to sue the defendant - held: They were not persons affected.

ADELAIDE PARKLANDS PRESERVATION ASSOC INC & ORS v THE CORPORATION OF THE CITY OF ADELAIDE
[2008] SADC 38
Introduction

This case raises questions of statutory construction. The plaintiffs claim that they are adversely affected by two resolutions of The Corporation of the City of Adelaide. They say that two members of the Council who voted for the resolutions had a conflict of interests and, as a consequence, the court should annul the resolutions.
Background
The two impugned resolutions of the Council are among several which concern a State Government proposal to redevelop parts of Victoria Park on the eastern boundary of the city of Adelaide. More particularly the proposal was to redevelop the racetrack and to erect a multipurpose building incorporating a grandstand. The area has for many years catered for horse racing and in more recent years for car racing as well. Councillors Haywood and Moran were nominated by the Council to be two of nine members of the South Australia Motor Sport Board appointed by the Governor pursuant to the South Australian Motor Sport Act 1984.
The plaintiffs first sought the annulment of only one resolution of the Council, that passed by the Council on 29 March 2007. The vote was four for and four against the resolution. The Lord Mayor’s casting vote ensured its passage. The plaintiffs say that the Councillors’ participation in the resolution is infected by a conflict of interest contemplated by s 73 and s 74 of the Local Government Act 1999.
The two Councillors declared their interest, namely their membership of the South Australia Motor Sport’s Board, but indicated that they had received legal advice to the effect that their membership did not disentitle them to take part in the Council’s deliberations, including the casting of votes. In the event one Councillor moved the resolution and the other seconded it. Each took part in the discussions and each voted for the resolution.
The gravamen of the resolution was that, while the Council had reservations about the size of the proposed building in Victoria Park, it was willing to proceed further along the track towards the realisation of the redevelopment. Further down that track were statutory processes such as public consultation and consideration by the Council of the question whether it should grant a lease over the park to the Government. The plaintiffs say that the resolution was an important step in that process and that it affected them. The defendant says that the resolution was a relatively minor incidental step which did not affect the plaintiffs.
The first plaintiff is an organisation which seeks to preserve and enhance parklands. The second plaintiff is a resident of South Terrace living close to the park and using it for recreation. The third plaintiff is a resident of East Terrace which abuts the park. She too is a user of the park. Each claims to be affected by the proposal and by the resolution. Hence each claims to have standing to pursue this suit. The defendant disputes that claim to standing.
The defendant claims that the South Australia Motor Sport Association is a non-profit organisation. If that is so the Councillor’s involvement or interest in the organisation may not disentitle them to take part in the Council’s deliberations. The plaintiffs deny that the Association is not a non-profit organisation.
During the course of the proceedings the plaintiffs sought to amend their pleadings to include a subsequent resolution of the Council passed on 14 August 2007. The same areas of dispute between the parties concern each of the two resolutions.
The Issues
1. Does each or any of the plaintiffs have standing to sue the defendant? (The “standing” question.)
2. Do the Councillors have a conflict of interest contemplated by section 73 and 74 of the Local Government Act 1999, such that they were disentitled to participate in the resolution as defined in s 74(4)? (The “substantive” question.)
3. Notwithstanding positive answers 1. and 2., should the court annul the resolutions pursuant to s 74(5) (The “discretion” question.)
While there is a forensic logic in deciding the “standing” question first, I choose to deliberate first on the “substantive” question.
The substantive question
It is convenient to set out in full s 73 and s 74 of the Local Government Act.
73—Conflict of interest
(1)     A member of a Council has an interest in a matter before the Council if—
(a)     the member or a person with whom the member is closely associated would, if the matter were decided in a particular manner, receive or have a reasonable expectation of receiving a direct or indirect pecuniary benefit or suffer or have a reasonable expectation of suffering a direct or indirect pecuniary detriment; or
(b)     the member or a person with whom the member is closely associated would, if the matter were decided in a particular manner, obtain or have a reasonable expectation of obtaining a non-pecuniary benefit or suffer or have a reasonable expectation of suffering a non-pecuniary detriment,
(not being a benefit or detriment that would be enjoyed or suffered in common with all or a substantial proportion of the ratepayers, electors or residents of the area or a ward or some other substantial class of persons).
(2)A person is closely associated with a member of a Council—
(a)     if that person is a body corporate of which the member is a director or a member of the governing body; or
(b)     if that person is a proprietary company in which the member is a shareholder; or
(c)     if that person is a beneficiary under a trust or an object of a discretionary trust of which the member is a trustee; or
(d)     if that person is a partner of the member; or
(e)     if that person is the employer or an employee of the member; or
(f)    if that person is a person from whom the member has received or might reasonably be expected to receive a fee, commission or other reward for providing professional or other services; or
(g)     if that person is a relative of the member.
(3)A member of a Council who is a member, officer or employee of an agency or instrumentality of the Crown, will be regarded as having an interest in a matter before the Council if the matter directly concerns that agency or instrumentality but otherwise will not be regarded as having an interest in a matter by virtue of being a member, officer or employee of the agency or instrumentality.
(4)     In this section—
agency or instrumentality of the Crown includes—
(a)     an administrative unit of the Public Service;
(b)     a body corporate comprised of, or including or having a governing body comprised of or including, a Minister or Ministers of the Crown or a person or persons appointed by the Governor or a Minister or other agency or instrumentality of the Crown.
74—Members to disclose interests
(1)A member of a Council who has an interest in a matter before the Council must disclose the interest to the Council.
(2)A member in making a disclosure under subsection (1) must provide full and accurate details of the relevant interest.
(3)A disclosure made under subsection (1) must be recorded in the minutes of the Council (including details of the relevant interest).
(4)A member of a Council who has an interest in a matter before the Council must not—
(a)     propose or second a motion relating to the matter; or
(b)     take part in discussion by the Council relating to that matter; or
(c)     while such discussion is taking place, be in, or in the close vicinity of, the room in which or other place at which that matter is being discussed; or
(d)     vote in relation to that matter.
(4a)    The following qualifications apply:
(a)     subsections (1) and (4) do not apply—
(i)to questions relating to allowances or benefits that a Council is empowered to pay to, or confer on, members, their spouses, domestic partners or members of their families; or
(ii)to matters of a class exempted by regulation from the provisions of those subsections; or
(iii)to matters in relation to which the Minister has granted an exemption from the provisions of those subsections;
(b)     a member of a Council who has disclosed an interest under subsection (1) may, by permission of the Council, attend during proceedings of the Council on the relevant matter in order to ask or answer questions, provided that the meeting is open to the public, the member withdraws from the room after asking or answering the questions, and the member does not in any other way take part in any debate or vote on the matter;
(c)     subsection (4) does not apply in relation to a matter in which the member has an interest by virtue only of the fact that the member or a person closely associated with the member—
(i)is a member of, or director or member of the governing body of, a non-profit association; or
(ii)is a member of a body (whether corporate or unincorporate) comprised of or including, or having a governing body comprised of or including, a person or persons appointed by the Council;
(d)     a member does not contravene this section if the interest was unknown to the member at the relevant time.
(5)The fact that a member or members of a Council have failed to comply with this section in relation to a particular matter does not, of itself, invalidate a resolution or decision on that matter but, if it appears that the non-compliance may have had a decisive influence on the passing of the resolution or the making of the decision, the District Court may, on the application of the Council, the Minister or a person affected by the resolution or decision, annul the resolution or decision and make such ancillary or consequential orders as it thinks fit.
(6)     In this section—
non-profit association means a body (whether corporate or unincorporate)—
(a)     that does not have as its principal object or one of its principal objects the carrying on of a trade or the making of a profit; and
(b)     that is so constituted that its profits (if any) must be applied towards the purposes for which it is established and may not be distributed to its members,
and includes the LGA.
To answer the substantive question it is necessary to closely examine s 73 and s 74. It is not disputed that the Councillors had “an interest” in a matter before the Council when the resolution was being considered. The Councillors had an interest contemplated by s 73(1) because their membership of South Australia Motor Sport Board brought them within the purview of s 73(1)(b). That is so because they were members of the governing body of the Association which is a body corporate and thus a person within the meaning of sub-section (1)(b). Relevantly sub-section (1)(b) provides that:
A person with whom the member is closely associated (vis the Association) would, if the matter were decided in a particular manner, obtain or have a reasonable expectation of obtaining a non-pecuniary benefit.
The non-pecuniary benefit would be the enhanced facilities anticipated if the Government proposal went ahead. Thus by operation of s 73 the Councillors were brought within the operation of s 74.
Section 74(1) required the Councillors to disclose the interest. This they did. I recite the terms of the disclosure each made. Their disclosures were identical. They read as follows:
I declare that I have an interest in this matter.
This conflict arises by virtue of the fact that I am one of Council’s two nominees on the South Australia Motor Sport Board.
The Motor Sport Board is one of the parties that stands to benefit from the proposed redevelopment of Victoria Park, because the Board would receive an (sic) direct non-pecuniary benefit (being accessed to an improved venue for motor sport events).
I have been advised that, under applicable law, I am entitled to participate in tonight’s deliberations in the normal way including by voting in relation to this matter.
In participating in tonight’s deliberations I do so as a Councillor with obligation to act solely in the best interests of Council.
There is no dispute that the terms of the disclosure meet the requirements of sub-section (2) and that, pursuant to sub-section (3), the disclosure was recorded in the minutes of the Council.
Subject to qualifications, sub-section (4) disentitled the Councillors from proposing or seconding the motion, taking part in the discussion of the motion and voting on it. Councillor Haywood moved the motion, Councillor Moran moved an amendment, and each took part in the discussion and each voted in favour of the resolution.
The focus then moves to the qualifications contained in sub-section (4a). The only qualification that applies to the Councillors appears in placitum (c) of sub-section (4a). The proscription in sub-section (4) does not apply if the Councillor was a member of the governing body (here the Board) by virtue of being appointed by the Council (see (ii)) and the association is a non-profit association (see (i)). (It is not disputed that the word “or” appearing between those two is to be interpreted conjunctively, ie both conditions must be fulfilled.)
“Non-profit association” is defined in sub-section (6). To be a non-profit association the body must not have “as its principal object or one of its principal objects, the carrying on of a trade or the making of a profit”. Here it is agreed that the word “or” is to be read disjunctively, that is, the body will not be a non-profit association if it carries on a trade, and it will not be a non-profit association if it makes a profit. In addition, the association must be so constituted that any profit must be applied towards the purposes for which it is established and may not be distributed to its members. The plaintiffs contend that the South Australia Motor Sport Association failed each of those tests in that:
1) it has at least as one of its principal objects the carrying on of a trade,
2) it has at least one of its principal objects the making of a profit,
and
3) it was so constituted that it may distribute profits to a member or members.
The defendant disputed each of these propositions.
I turn first to the question of whether the association can be said to have as its principal object, or one of its principal objects, the carrying on of a trade.
Trade and Profit
The plaintiffs submit that the South Australia Motor Sport Association has trade as one of its principal objects. Dr Churches referred to the affidavit of Andrew William Daniels, the CEO of the Board ,dated 27 July 2007. The Annual Report of the Board is Exhibit 1 to that affidavit. Dr Churches drew attention to pages 3-7 and page 17 of the Annual Report. I will not reproduce all the Principal Objectives (page 3) or the Mission Statement or the Board’s Economic Objectives 2006-2007 which appear on page 4 of the Annual Report. The principal objectives include the following:
·Undertake on behalf of the State the promotion of motor sport events;
·Do all things necessary for or in connection with the conduct and financial and commercial management of each event promoted by the Board;
·Establish a temporary motor racing circuit and conduct and manage motor racing events promoted by the Board.
The Mission statement includes the following:
·Provide substantial and tangible economic benefits to the State of South Australia.
Under the heading “Economic Objectives 2006/7” there is the following:
·Economic benefit 27.5 million dollars
Dr Churches submitted that the body is therefore one which deals with money and which seeks to benefit the State in the realm of 27.5 million dollars. In other parts of the annual report there are references to financial matters. In the Chairman’s Report on page 6 there is a reference to an increase in profit. Before turning to the authorities, Dr Churches summarised the position of the Board as being a body which engages in trade. It provides in the market place a spectacle for patrons which generates profit. He then referred to a passage of Barwick CJ in the case of The Queen v Federal Court of Australia; ex parte WA National Football League (1979) 143 CLR 190 at 211 (Adamson’s case) where His Honour said:
In my opinion, the presentation of a football match has a commercial venture for profit. To the promoting body it is an activity of trade;
He submitted that this case was on all fours with the present case. He referred to the application of that case by Debelle J in South Australia National Football League Inc v City of Charles Sturt (1998) 97 LGERA 293 at 307.
His Honour was there considering the meaning of the expression “commercial purposes” in relation to the South Australia National Football League Inc. His Honour referred to Barwick CJ:
… The Leagues uses the stadium at Football Park to produce income by staging football matches between teams manned by professional players and charging the public and members fees to watch the game. It also provides other facilities from which it derives a very substantial revenue. The stadium is, therefore, used for a commercial purpose.
Dr Churches then referred to s 10 of the South Australia Motor Sport Act 1984 which sets out the functions and powers of the Board. The functions in sub-section (1) are those already noted in the Annual Report of Mr Daniels. The powers in sub-section (2) include several which have a commercial flavour such as placitum (c) which provides “that the Board may carry on any advertising and promotional activity”. Dr Churches submitted that these powers are indicia of a body which has trade as a major feature of its operations. In those circumstances he submitted it was apt to have regard to remarks by the Full Court of the Federal Court in Braverus Maritime Inc v Port Kembla Coal Terminal Ltd and Ano (2005) 148 FCR 68. The court was there considering whether the conduct of a pilot who provide compulsory pilotage services was engaged in “trade or commerce” for the purposes of s 52 of the Trade Practices Act. Referring to the pilotage service the court said:
…Another objective of a State owned corporation is to facilitate and promote trade through its port facilities. The concept of ‘promotion’ has a trading and commercial flavour. As part of the functions that it may perform, a port corporation is empowered to conduct any ‘business’, whether or not related to its principal activities, that it considers will further its objectives… The corporation has a statutory duty to charge for pilotage services and these charges may be at different rates and different ports.

Dr Churches drew an analogy between the State owned corporation there referred to and the Motor Sport Board. His submission is that the Board cannot be described as a non-profit association because one of its principal objects is the carrying on of a trade. In addition he submitted that reference to the Annual Report discloses a reference to profit. I will not canvas the various references to that word but it appears in several different contexts. The organisation claims to make a profit.
Mr Henry for the defendant submitted that the question is not whether the Board trades or whether it makes a profit. Rather it is whether its principal object or one of its principal objects includes those activities. He argued that to determine the principal object or objects of a statutory body you turn to the functions set out in the creating statute.
I have previously referred to the functions set out in s 10 of the South Australia Motor Sport Act 1984. It can be fairly said that the functions centre around the second function named viz “To undertake on behalf of the State the promotion of motor sport events”. The other functions and the powers are devoted to that end. Mr Henry submitted that the plaintiffs’ submissions on the question of trade, raised by sub-section 6(a), is misconceived. It equates “a trade”, which appears in the sub-section, with “trade”. He referred to the case of Tanchiatco v Minister for Immigration and Multicultural Affairs (1997) 77 FCR 298 at 302. Branson J there said:
A particular job can never constitute a trade. A ‘trade’ is a category of employment in contra-distinction to unskilled labour and to the various professions.
“A trade” is to be distinguished from the notion of carrying on trade, or trading. The indefinite article “a” before “trade” designates that to which Branson J was referring. The promotion of motor sport could not be described as ‘a trade’. Mr Henry went on to distinguish Braverus (ibid), first, on the basis that that case was concerned with a characterisation of a particular course of conduct and not, as here, the status of the organisation concerned. A second basis for distinction is that the legislation creating the ports corporation set it up to be an efficient business. I must say on this point aspects of the corporation in that case listed at paragraph [145] of the judgment do not seem all that different from the materials referred to in the present case. However a point of distinction is that the Board is accounted for and audited as a not for profit organisation in contra-distinction to other entities set out in page 4 of the second exhibit to the affidavit of Mr Daniels. such as SA Lotteries Commission, Water and Trans Adelaide which are expressed to be “for profit entities”.
Again, although it may not be determinative of the matter, the operating surplus of $890,000 of the Board was achieved only after a State grant of 2 million dollars in 2005 and 1.9 million dollars in 2006 was taken into account. In reality the Board operated at a loss in both years. In addition the operating profit was to be put towards infrastructure. These considerations are more consistent with a not for profit organisation.
In the end I think that the Board does come within the first limb of the definition of non-profit organisation in s 74(6). I think there is a critical difference between “trade” and “a trade”. They are two different things and while it may be the case that Board “trades” it cannot be said that it carries of “a trade”. Win my view the inclusion of the indefinite article “a” makes that clear.
I think that is really sufficient to dispose of the matter but there is the further consideration of whether the carrying on of “a trade” can be described as the Board’s principal object or one of its principal objects. In my view the carrying on of “a trade” cannot be said to be either the principal object nor one of the principal objects of the Board. This consideration also applied to the question of whether the Board has, as its principal object or one of its principal objects, the making of a profit. In my view the making of a profit is not one of the principal objects of Board but is secondary to what I see as the principal object, namely, the undertaking on behalf of the State the promotion of motor sport events.
Distribution of profits to members
There is of course the second limb of the definition of non-profit association to be considered. The Board must be so constituted that its profits, if any, must be applied towards the purposes for which it is established and may not be distributed to its members.
Dr Churches sought to argue that the Board did not meet this criterion because it distributed its profits to the Government. He sought to argue that the Government stood in the place of a shareholder or member of the organisation. In that way the Board could not be a non-profit organisation. He could not and did not argue that the members of the Board appointed by the Governor stood to receive the profits of the Board. Plainly they do not He cited no authority for the characterisation of the Government as a member or as a shareholder and in my view, that argument is untenable. It seems entirely inapt to describe the Government as a member of the Board and that impression is reinforced when one looks at the purpose of the division of the Act dealing with conflict of interest. The whole purpose of those provisions is to prohibit Councillors from taking part in deliberations which expose them to a conflict of interest. They would be in a conflict of interest if they, as members of an organisation, were in a position to receive financial benefit. They do not stand to receive financial benefit if profits are distributed, not to the members, but to a third party such as the Government. In my view the Board fits this limb of the definition of non-profit association as well as the first limb. The Board is in my view a non-profit association for the purposes of s 74(6)(c). The Board is so constituted that the profits may not be distributed to its members.
Appointed/nominated
The only basis then upon which it could be said that the prohibition in sub-section (4) does apply to the Councillors is if they were not actually appointed to the Board by the Council. It is clear that the process which takes place is that the Council nominates Council members for consideration by the Governor who may then appoint them to the Board. Presumably the Governor may decline to appoint a nominee. The appointees may not thereafter be removed from the Board by the Council. The Council may not, it would appear, remove them by withdrawing their nomination. They may only be removed from the Board by the Governor pursuant to s 6(3) of the Act. On one view of it that may be regarded as a distinction without a difference – a mere technicality. Presumably the whole purpose of the Council nominating members to Boards such as this is that it may better ensure that its interests, and those of its constituents, are represented on such a Board. In turn the members may keep the Council informed of the deliberations and decisions of the body. The Council would not wish to be deprived of their contribution to Council debates on topics relevant to the body. On the contrary it would wish to benefit from their contribution. It would thus seem idiosyncratic that a Councillor acting as a representative of the Council on such a body should be disentitled to take part in the Council’s deliberations on topics concerning the body. Nevertheless, the legislature has chosen to use the word “appointed”. It could easily have used, or included, the word “nominated”. Appointment is a different process from nomination as is evident in this case. The Council may nominate a member for consideration for appointment by the Governor to the Board but the Governor may decline the nomination. If the Governor appoints the nominated member then only the Governor may remove the member from the Board. The Council has no power to do so. In those circumstances the Council members in this case were not appointed by the Council within the meaning of s 74(6)(c)(ii). Thus, while I find that the Board of which they are members is a non-profit association they are not appointed to that body by the Council. Both criteria must be met to qualify for the exclusion from the proscriptions in sub-section (4). The word “or” is to be read in this context conjunctively not disjunctively.
Accordingly I find that the proscriptions in sub-section (4) do apply to the Councillors
The Standing Question
Section 74(5) entitles three entities to apply to the court for the annulment of the Council’s resolution; the Council, the Minister and “a person affected by the resolution”. A person can include a body corporate such as the first plaintiff. It is necessary to analyse what exactly the resolution does and then determine whether each of the plaintiffs is a person affected by it.
There are of course two resolutions – one on 29 March 2007 and the other on 14 August 2007. The resolutions must be seen in the context of the process being undertaken by the Council in relation to the Government’s proposal for Victoria Park.
The Council had considered the matter at a meeting on 26 March. On that occasion Councillor Brine moved and Councillor Darley seconded a motion which was put and carried. That motion reads:
That Council
(1)     Notes that Council has commissioned and received a document “Urban Design Assessment” on the State Government’s proposed upgrade to Victoria Park / Bakkabakkandi, namely, attachment B to item number 5.3 on the agenda for the meeting of the City and Strategy and Policy Committee held on 26 March 2007;
(2)     Adopt the advice of The Adelaide Park Lands Authority from its meeting of 20 March 2007; namely that The Adelaide Park Lands Authority advises Council; with respect to the impact of the State Government’s proposal on the park lands, that whilst it acknowledges that there are some potential benefits of the concept it cannot accept the proposal in its current form primarily due to the nature of the built form; and, to seek a collaborative and comprehensive design review of the proposal with the State Government to address the recommendations of the Urban Design Assessment.
(3)     The State Government to be advised accordingly[1].
[1]    Exhibit MC4 to affidavit of Martin David Cooke Sworn on 27/7/07
That motion might be described as the Council indicating, at least in part, its attitude to the Government’s proposal. The operative paragraph of the resolution is paragraph (2) which says in effect that the Council cannot accept the proposal in its present form but it seeks a “collaborative and comprehensive design review of the proposal with the State Government”. For the redevelopment to proceed the Government had to obtain two authorisations under two statutory regimes. It had to:
1) Seek development approval from the Development Assessment Commission under the Development Act 1993, and;
2) Obtain a lease of the relevant area under s 202 of the Local Government Act.
Theoretically at least the Government did not have to consult with the Council but from a practical point of view it considered it should proceed in consultation with the Council. On one view of it then the consideration by the Council and the motions passed by the Council were voluntary. They can be seen as important steps in the process. The defendant emphasises that the former and the plaintiffs emphasises the latter.
The catalyst for the Council’s meeting on 29 March, at which it passed the first of the impugned resolutions, appears to be a letter written by the Deputy Premier and Treasurer, Mr Kevin Foley MP, dated 27 March 2007[2]. Although the letter did not refer to the Council’s resolution of 26 March, it did refer to a letter the Deputy Premier had written two days earlier, on 25 March. This passage appears in the letter:
… I reiterate the three clear options available to Council as contained in my letter of March 25 2007.
1. Council can vote to accept the State Government’s master plan for Victoria Park in its current form;
2.Council can reject the proposal all together (sic) and end the project immediately;
or
3.Council can advise the State Government of a clear indication of their requirements for height, length and style of grandstand construction that it would support.
The Adelaide City Council needs to clearly articulate to me by this Friday 30 March 2007 exactly what its position is with regard to the State Government’s master plan for Victoria Park. … Should Council fail to provide me with this advice by the deadline, the Government will have no option but to cancel this project immediately.
[2] Exhibit MC5 referred to in the affidavit of Martin David Cooke
The meeting on 29 March is described in the agenda as a Special Meeting (see Exhibit marked MC6 referred to in the affidavit of Mr Cooke). The minutes of the Special Meeting of the Council on 29 March are exhibited to the affidavit of Michael David Henningsen sworn on 7 June 2007 and marked MDH1.
The motion moved by Councillor Haywood and seconded by Councillor Darley reads as follows:
That Council:-
(1)Reiterates its request for a collaborative design review of the State Government’s redevelopment proposal for Victoria Park / Bakkabakkandi based on the recommendations of the Urban Design Assessment received by the City Strategy & Policy committee on 26 March 2007
(2)Adopts the key design parameters (Attachment A to Item No. 1 on the Agenda for the Special Meeting of the Adelaide City Council held on 29 March 2007) which clarify the key design recommendations of the Urban Design Assessment, including for the height, length and style of grandstand;
(3)Advises the State Government that these key design parameters, if satisfied, will allow Council to support the proposal ‘in principle’;
(4)Asks the Government to note that the Development Assessment Commission will be the final arbiter of design detail as part of the Development Application process; and
(5)Asks the Government to note that pursuant to Section 202 of the Local Government Act 1999 and Section 21 of the Adelaide Park Lands Act 2005, Council is required to undertake public consultation before it can enter into a lease to facilitate the proposal.
(6)Asks the State Government to note that, while the specific terms of any lease have yet to be resolved, Council will be requiring that any lease document specifically prohibit the use of the building for a function centre or for any other commercial activity outside of racing or motor sport events.
It can be seen that paragraphs (4) and (5) refer to the two statutory processes that must be undertaken before the project could be accomplished. Paragraph (1), (2) and (3) might be described as indicating a slightly qualified agreement by the Council to proceed further with the process. The resolution might also be described a being more positive about the proposal than was the Council’s resolution three days earlier. As mentioned earlier, the vote on 29 March was four Councillors in favour of the resolution and four against. The Lord Mayor’s casting vote ensured its passage.
During argument on this matter on 20 September 2007 I put to Dr Churches that the question of whether this resolution should be annulled by the Court was really moot because of a later resolution of the Council. On 14 August the Council passed another resolution. That resolution is exhibited to the later affidavit of Martin David Cooke sworn on 5 October 2007 and is marked MDC1. That resolution was moved by Councillor Haywood and seconded by Councillor Moran. It was carried by six votes to two. Councillors Haywood and Moran were in the majority but it can be seen that even without their votes the motion would have been passed by four votes to two. Councillors who had been voted against the resolution on 29 March had changed their vote, partly no doubt because what might be described as the operative paragraph of the resolution, paragraph (3), provided for public consultation on the draft lease proposal. The resolution reads in full:
That Council note that:
(1)Its design requirements for “in principle” support have been satisfied and that the Development Assessment Commission will now determine final design detail via the development assessment process.
(2)The State Government has requested a long term lease over the subject site as described in Attachment B to Item No. 1 on the Agenda for the Special Meeting of the City Strategy & Police Committee held on 14 August 2007;
(3)Pursuant to section 202 of the Local Government Act 1999, public consultation on the draft Lease Proposal will commence on 23 August 2007 for a four week period and will otherwise be undertaken in accordance with Council’s Public Communication and Consultation Policy (being Attachment B to Item No. 1 on the Agenda fro the Special Meeting of the City Strategy & Policy Committee held on 14 August 2007);
(4)The advice of the Adelaide Park Lands Authority will be sought in relation to the draft Lease Proposal; and
(5)The results of this consultation and advice will be reported back to Council for a decision on whether or not to proceed to submit the proposed lease to both Houses of Parliament in accordance with the requirements of the Adelaide Park Lands Act 2005.
Between the hearing in this matter on 20 September 2007 and 9 October 2007 the plaintiffs filed an amended summons seeking to have the resolution of 4 August 2007 also annulled.
The defendant posed this question about that resolution. How can a resolution effectively setting up a process of public consultation affect the plaintiffs? The plaintiffs’ answer is that the later resolution, like the first, is a practical step in the realisation of a project which will affect them. They argue that, put at its highest, it is disingenuous to suggest that the resolutions are informal, relatively minor steps, in a much larger process in which, if they truly have standing, their rights are preserved. They may take part in the public consultation. The crucial decision by the Council is some further way down the track when it considers whether to grant a lease to the Government to undertake the project.
Before dealing with that aspect of the ‘standing’ question I turn to examine the question of whether each of the plaintiffs is a person who may be affected by the resolution even if the resolution were to be regarded as a critical one. Are they persons who will really be affected by the resolution even if it was a critical one. The plaintiffs must demonstrate that they are affected by the resolution, not affected in some way by the subject matter of the resolution.
Mr Henry submits that the plaintiffs must show that the effect on them will be greater than that on any other member of the public. He cites as authority for that proposition the case of Onesteel Manufacturing Pty Ltd v Whyalla Red Dust Action Group Inc (2006) 94 SASR 357 at 362 per Debelle J who was in turn quoting from Byron Environmental Centre Inc v Arakwal People. His Honour said this:
It is clear that s 104(7)(b) does not permit just any person to make an application. The applicant must be able to demonstrate that his, her or its interests are affected by the subject matter of the application. As Black CJ noted in Byron Environmental Centre Inc v Arakwal People (1979) 78 FCR 1 at 9: “When parliament, by giving rights of an important character to those whose “interests are affected” rather than to “any person”, has revealed an intention to require an interest greater than that of any member of the general public, it is unlikely that it intended to extend the notion of “interests” to something that any member of the public could assert, so as to deny significant practical effect to the requirement that a person having an interest greater than that of any ordinary member of the public." The applicant must be able to demonstrate not only that the applicant’s interests are affected, but that they are also affected by the subject matter of the application.

That last sentence is important. The test applies not just to the proximity of the person said to be affected by the subject matter but also to the subject matter itself, that is the subject matter of the resolution. What exactly is the effect of the resolution? Before I answer that important question I turn to the status or proximity of the plaintiffs. Mr Henry submitted that none of the plaintiffs’ interests would be affected to a greater extent than any other member of the community. Dealing with them singly he submitted that so far as the first plaintiff is concerned, The Adelaide Parklands Preservation Association Inc, it is an incorporated association and accordingly it must be able to demonstrate that its own interests would be affected, not those of its members. It does not have standing simply because some of its members might have standing. I accept that proposition but it is an organisation set up precisely to help preserve the Adelaide Park Lands of which Victoria Park is a part. The organisation has for a long time involved itself in discussions and activities involving the Parklands.
Dr Churches submitted that High Court cases such as The Australian Conservation Foundation v The Commonwealth (1980) 146 CLR 493 and Bateman’s Bay Local Aboriginal Land Council v The Aboriginal Community Benefit Fund Pty Ltd (1998) 194 CLR 247 suggest a wider locus standi for community organisations than was once the case. He drew attention to a discussion of those more recent cases by Sackville J in North Coast Environment Council Inc v Minister for Resources (1994) 55 FCR 492 at 512-513. His Honour held that an organisation must be able to demonstrate “a special interest” and it must be able to demonstrate that not just from its constitutional objects but from its activities. In this case an affidavit by James William Daly sets out both the constitutional position of the first plaintiff and the work of the association.
So far as the second and third plaintiffs are concerned, Mr Henry submitted that while each lives close to the park and makes regular use of it, their interests could not be said to be greater than that of any other member of the public. Dr Churches emphasized the special amenity enjoyed by these residents who live so close to the park.
For reasons that will become clear, I will not dwell on this discussion. My tentative view is that all three plaintiffs, for their different reasons, would have standing so long as they could demonstrate that these particular resolutions were going to affect them.
It is to the resolutions that I now turn. The parties were sharply divided on the effect of the resolutions. I have already set out the place that each resolution occupies in the larger process being undertaken both by the State Government and the City Council. I have referred to the resolutions of the Council passed on 26 March 2007, 29 March 2007 and 14 August 2007. Mr Henry submits, I think correctly, that none of the resolutions was a formal requirement required by statutes. I have already indicated the relevant statutory obligations in the process. He submitted that neither of the resolutions the subject of these proceedings could be said to have affected any of the plaintiffs. I focus on the first resolution – the one of 29 March 2007. I do not think it would be inaccurate to conclude that the resolution proposed and passed on 26 March was one which was not particularly positive about the redevelopment. The letter of the Minister on 27 March could be said to reflect some impatience with that resolution. The resolution passed on 29 March could, I think, be said to be different in its tenor. It is more broadly in favour of the redevelopment. During submissions it was described as giving an amber light to the Government. As I have said earlier the parties were sharply divided on its significance. The plaintiffs assert that while it might not be a resolution formally required in the process, it represented a crucial change of attitude by the council to one which was more sympathetic to the Government’s proposal than had been the resolution of 26 March. By reason of that importance, the plaintiffs submitted that their interests were affected.
The defendant on the other hand submits that the resolution was little more than a small step in an informal and voluntary part of the process towards realising the redevelopment plans. I think that probably understates the significance of the resolution but the fact remains that there was still a process of public consultation to be undertaken before the matter could proceed any further. That was the subject of the resolution on 14 August. Councillors who had voted against the resolution on 29 March voted for the one on 14 August, so that even if Councillors Moran and Haywood had not voted for it it would still in all likelihood have passed. The vote was six to two in favour. The Councillors who this time voted in favour of the resolution no doubt felt that it was inappropriate to vote against a resolution which was providing for a process or public consultation on the proposal.
Crucially in my view neither of these resolutions removed a right from any of the plaintiffs. On the contrary the second resolution facilitated the exercise of rights they had to take part in the public consultation. Potential resolutions after the public consultation may have had an entirely different and greater effect on the process and on the plaintiffs. I have not overlooked the reality that each of the subject resolutions could be seen as progressing down the path of realising the redevelopment plans but I do not think they are as significant as the plaintiffs assert.
It is for this reason that I do not think that the plaintiffs, or any one of them, is “a person affected by the resolution”. The resolutions themselves do not affect them in the special way contemplated by the authorities discussed. It is not because of who they are that they fail to fit the descriptions but that the resolutions are not such as to effect them in they way required by the authorities. For that reason I find that in relation to these two resolutions, the plaintiffs do not have standing
Discretion
If I am wrong in disqualifying the plaintiffs from having the standing contemplated by s 74(5) for the reasons I have discussed then I would still have to consider whether the discretion vested in the court to annul the resolutions should be exercised in favour of the plaintiffs. Even if any one of them could be said to be a person affected by the resolution then in my view it would be a relevant consideration in the exercise of that discretion to consider the extent to which the resolution affected them. A criterion or consideration militating against the exercise of the discretion would be whether any rights have been lost or compromised by the resolutions. If, contrary to my finding, they may be affected by the resolutions, it cannot be said that they do not have later opportunities to exercise rights. In those circumstances I decline to exercise the discretion to annul the resolutions. I speak of the resolutions collectively, but I have considered each of them.
Conclusion
I find as follows:
1. That the plaintiffs do not have standing to sue the defendant.
2. That the Councillors were prevented by s 74(4) of the Local Government Act from inter alia voting on either of the resolutions passed on 29 March and 14 April 2007
3. In the alternative to the finding in paragraph 1 I exercise the discretion pursuant to s 74(5) of the Act not to annul the resolutions passed by the Council.