Blue Mountains Council v Minister for Local Government (No 2)

[2018] NSWSC 193

Supreme Court

New South Wales

Medium Neutral Citation:

Blue Mountains Council v Minister for Local Government (No 2) [2018] NSWSC 193

Hearing dates:

23 February 2018

Date of orders:

23 February 2018

Decision date:

23 February 2018

Jurisdiction:

Common Law

Before:

Schmidt J

Decision:

The proceedings be transferred from this Court to the Land and Environment Court.

 The parties should now approach the Land and Environment Court to obtain an urgent hearing in that court.

Catchwords:

PROCEDURE – application to have the matter transferred to the Land and Environment Court – granted

 

INJUNCTION – whether injunction should be dissolved – dissolution refused

LOCAL GOVERNMENT – power of Minister to suspend council – proper construction of ss 438I and 438K of Local Government Act

Legislation Cited:

Land and Environment Court Act 1979 (NSW)
Local Government Act 1993 (NSW)
Local Government General Regulation 2005 (NSW)
Supreme Court Act 1970 (NSW)

Cases Cited:

Blue Mountains Council v Minister for Local Government [2018] NSWSC 183

Category:

Procedural and other rulings

Parties:

Blue Mountains City Council (Plaintiff)
Minister for Local Government (Defendant)

Representation:

Counsel:
P Singleton (Plaintiff)
Mr J Emmett (Defendant)

  Solicitors:
McPhee Kelshaw (Plaintiff)
Crown Solicitor’s Office

File Number(s):

2018/60355

Publication restriction:

Nil

EX TEMPORE Judgment

1. HER HONOUR: Yesterday, I heard an ex parte application whereby the Council sought orders restraining the Minister for Local Government from making a decision, the subject of a notice given to the Council by letter of 14 February 2018 under s 438K of the Local Government Act1993 (NSW). I made orders that day which had the result that the parties are today before the Court, when two questions arise. The first, whether the proceedings should be transferred to the Land and Environment Court, a possibility foreshadowed yesterday in circumstances discussed in my judgment: Blue Mountains Council v Minister for Local Government [2018] NSWSC 183.

2. The Minister's application today is that the transfer be ordered. The Council neither consents to, nor opposes such a transfer. I am satisfied in the circumstances which are discussed in the first judgment, that it is appropriate to order the transfer of the proceedings to that Court.

3. The second question is raised by an application made for the Minister, that the orders made yesterday should be dissolved. Arguments were advanced in support of that application which went to the construction of the Local Government Act and the conclusions which I had reached as to both the question of whether there was a serious question to be tried on the application before the Court, and where the balance of convenience lay.

The requirements of the Local Government Act

4. As to the proper construction of the relevant provisions of the Local Government Act, particularly ss 438I and 438K, I am not satisfied that the submissions advanced for the Minister can be accepted.

5. Section 438K(1) begins with:

“The Minister is to give a Council notice in writing of his or her intention to suspend the Council.”

6. In my view, such an intention can only be formed in limited circumstances, namely those specified in s 438I. The Parliament, in enacting s 438I, has permitted the Minister to suspend an elected Council, only in circumstances. They are provided in s 438I(1), where:

“the Minister reasonably believes that the appointment of an interim administrator is necessary to restore the proper or effective functioning of the Council.”

7. It follows that in this statutory scheme, necessarily the formulation of an intention to suspend the Council can only occur in a context where the Minister takes into account that limitation.

8. That conclusion is supported by the requirement then imposed on the Minister by s 438K(2), which requires in paragraph (a) that the reasons why it is proposed to suspend the Council, be specified in the notice given.

The order should not be dissolved

9. That view of the statutory scheme supports the conclusion that I have reached, contrary to the submissions advanced for the Minister, that there is a serious question to be tried in respect of the matters which brought the parties before the Court.

10. Section 673 of the Local Government Act permits proceedings to be brought not only to remedy breaches of the Act by the Minister, but also to restrain them. That is the purpose for which the proceedings have been brought by the Council.

11. The parties again referred to the terms of the letter by which the s 438K notice was given by the Minister on 14 February. While that letter refers to s 438K, it makes no reference either to s 438I, or to the limitation which it imposes on the Minister.

12. That letter has to be contrasted with a previous notice given to this Council by the Minister, in December 2017, in which not only was reference made to s 438K, but also to s 438I and also the statutory limitation, namely, “a reasonable belief that appointment of an interim administrator is necessary to restore the proper or effective functioning of the Council”. Not only did the Minister there make reference to that requirement, she then advised of the formation of a preliminary belief that appointment of an interim administrator was necessary for that purpose. She also informed the Council that she had considered the criterion imposed by clause 413E of the Local Government General Regulation 2005 (NSW) which she said she had also considered. Reasons for the formulation of the statutory belief were then given.

13. The difference between the December notice, to that given to the Council in February, is not only marked, it also supports the conclusion which I reached yesterday, that necessary consideration to the requirements of s 438I were not given by the Minister, prior to the giving of the second s 438K notice.

14. That being so, I remain of the view that there is a serious question to be tried lying between the parties. The fact that as yet, the Minister has not made a decision, and that in December, she was dissuaded from making a decision under the statutory scheme to suspend the Council, in my view, does not detract from that conclusion.

15. I am also not convinced that the balance of convenience lies with the Minister.

16. There are a number of public interests which arise to be considered. On the one hand, there is an interest in elected councils only being suspended in the circumstances which the Legislature has specified in s 438I, after the requirements imposed on the Minister by s 438K are followed. That interest is, of course, to be weighed against the public interest in the Minister's ability, if the statutory view is reached, of moving with the alacrity which the legislative scheme permits, to suspend a council.

17. Despite what has fallen from counsel appearing for the Minister, I am not persuaded that the balance of convenience lies with the Minister, rather than with the elected Council.

18. As both parties accepted, it is entirely open to the Minister to revisit what has occurred and to take steps in accordance with the requirements of the statutory scheme, despite the orders made yesterday. If it is thought that there has been some problem with the process which has thus far been pursued, the delay involved with that course, when compared to what might be involved by way of delay before a final hearing in the Land and Environment Court, I cannot see is either going to be lengthy, or dissimilar.

19. Indeed, there has been no evidence led by the Minister as to any matter of urgency which ought to be taken into account when weighing where the balance of convenience lies.

20. In all of those circumstances, I am not satisfied that the dissolution of the orders made yesterday should now be ordered.

Order

21. Accordingly, I order that the proceedings be transferred from this Court to the Land and Environment Court.

22. I will take the necessary steps to have that order drawn to the attention of the Registrar, so that the file can physically be transferred. The parties should now approach the Land and Environment Court to obtain an urgent hearing in that court.

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Decision last updated: 23 February 2018