Botany Bay City Council v The State of New South Wales

[2016] NSWCA 243

Court of Appeal

Supreme Court

New South Wales

Medium Neutral Citation:

Botany Bay City Council v The State of New South Wales [2016] NSWCA 243

Hearing dates:

29 June 2016

Decision date:

02 September 2016

Before:

Bathurst CJ at [1];
Ward JA at [2];
Sackville AJA at [3]

Decision:

(1) Refuse leave to the applicant to appeal on Grounds 10-12 and 14 in the draft Notice of Appeal.

 

(2) Grant leave to the applicant to appeal from the decision of Garling J delivered 9 June 2016 on Grounds 1-9 and 13 in the draft Notice of Appeal.

 

(3) Direct the applicant to file an Amended Notice of Appeal, limited to Grounds 1-9 and 13 in the draft Notice of Appeal, within 7 days.

 

(4) Dismiss the appeal.

 (5) The applicant pay the respondent’s costs of the application for leave to appeal and of the appeal.

Catchwords:

LOCAL GOVERNMENT – amalgamation of councils – Minister proposes amalgamation of two councils – proposal referred to a delegate of the Chief Executive for examination and report pursuant to s 218F(1) of the Local Government Act 1993 (NSW)(LG Act) – the delegate’s report forwarded to the Local Government Boundaries Commission (Commission) for review and comment pursuant to s 218F(6) of the LG Act – Commission’s review forwarded to the Minister – whether the delegate was obliged to alert one of the affected councils in advance that he proposed to give little weight to a “Community Poll” conducted by the council – whether the Commission misconstrued its functions under the LG Act by failing to consider independently the merits of the Minister’s proposal as distinct from renewing the delegate’s report – whether the Minister denied the affected council procedural fairness by allowing a limited time for further submissions before the Minister made a recommendation to the Governor.

Legislation Cited:

Local Government At 1993 (NSW), ss 7, 15, 16, 204, 206, 214, 218A, 218B, s 218D, s 218E, 218F, 260, 261, 262, 263, 264, 265, 745
Supreme Court Act 1970 (NSW), ss 75A, 101(2)(r)

Cases Cited:

Applicant VEAL of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs [2005] HCA 72; 225 CLR 88
Botany Bay City Council v Minister for Local Government [2016] NSWLEC 35
Botany Bay City Council v Minister for Local Government [2016] NSWCA 74; 214 LGERA 173
Botany Bay City Council v State of New South Wales [2016] NSWSC 583
Brettingham-Moore v St Leonards Corporation [1969] HCA 40; 121 CLR 509
Kioa v West [1985] HCA 81; 159 CLR 550
Kirk v Industrial Relations Commission of New South Wales [2010] HCA 1; 239 CLR 531
Minister for Local Government v South Sydney City Council [2002] NSWCA 288; 55 NSWLR 381
SZBEL v The Minister for Immigration and Multicultural and Indigenous Affairs [2006] HCA 63; 228 CLR 152

Category:

Principal judgment

Parties:

Botany Bay City Council (Applicant)
State of New South Wales (Respondent)

Representation:

Counsel:
Mr M Robinson SC / Mr C Jackson (Applicant)
Mr JK Kirk SC / Mr J Hutton / Ms M Ellicot (Respondent)

  Solicitors:
Houston Dearn O’Connor (Applicant)

File Number(s):

2016/183627

 Decision under appeal 

Court or tribunal:

Supreme Court of New South Wales

Jurisdiction:

Common Law Division

Citation:

[2016] NSWSC 583

Date of Decision:

09 June 2016

Before:

Garling J

File Number(s):

2016/134789

HEADNOTE

[This headnote should not be read as part of the judgment]

This appeal arises out of a proposal made on 6 January 2016 by the Minister for Local Government (Minister), for the amalgamation of Botany Bay City Council (Botany) and Rockdale Council. As required by the Local Government Act 1993 (NSW) (LG Act), the Minister’s Proposal (Minister’s Proposal) was referred to the Chief Executive of the Office of Local Government (Chief Executive) for examination and report, who in turn referred the proposal to a Delegate.

Botany provided detailed written submissions to the Delegate opposing the Minister’s Proposal. The submissions included the results of a Community Poll that purportedly revealed the community’s opposition to the amalgamation.

The Delegate completed his report (Delegate’s Report) which was then sent to the Local Government Boundaries Commission (Commission) for “review and comment”, as required by the LG Act. The Delegate’s Report and the Commission’s Review were then provided to the Minister who, on 12 May 2016, announced his support for the amalgamation.

Botany commenced proceedings in the Supreme Court of New South Wales seeking a declaration that the Delegate’s Report and the Commission’s Review were invalid on the grounds that: the Delegate failed to give proper weight to the Community Poll; in breach of his procedural fairness obligations, the Delegate made adverse findings about the poll without giving notice to Botany; and the Commission failed to undertake a proper review of the Report, thereby misapprehending its functions and powers. The primary Judge dismissed the claim for declaratory and other relief. Botany appeals from that decision.

In summary, the grounds on the appeal are as follows:

(i) The primary Judge should have held that the Commission’s Review on the Minister’s Proposal was ultra vires because the Commission misconstrued the powers and functions conferred on it by s 218F(6)(b) of the LG Act.

(ii)   The primary Judge should have found that the Minsiter failed to afford Botany procedural fairness, because the Minister allowed Botany only a limited time to make submissions on the Commission’s Review and the Delegate’s Report.

(iii)   The primary Judge should have found that the Delegate denied procedural fairness to Botany, in that he did not afford Botany an opportunity to answer adverse findings he proposed to make about the Community Poll conducted by Botany.

HELD:

The Court dismissed the appeal, (per Sackville AJA, Bathurst CJ and Ward JA agreeing):

In relation to (i):

Under s 218F(6) of the LG Act, the Commission is not required to examine and report on the Minister’s proposal, but is directed to review the Chief Executive’s report and send its comments to the Minister. The statutory language does not imply that the Commission must go beyond a review of the Chief Executive’s report and undertake its own independent evaluation of the proposal: [93]-[96].

In relation to (ii):

There was no evidence to substantiate Botany’s assertion that it had insufficient time to address any “credible, relevant and significant” adverse information. The Minister’s obligation went no further than allowing Botany an adequate opportunity to identify and correct what it considered to be factual errors and misconceptions in the Delegate’s Report or the Commission’s Review: [82]-[83].

In relation to (iii):

The Delegate gave the Community Poll little weight because Botany had campaigned against the Proposal and had framed the Poll as an opportunity for residents to voice their opposition and because Botany had not provided a balanced treatment of the merits or defects of the Proposal. Botany did not identify any significant factual matter that it wished to bring to the attention to the Delegate that would have been likely to have influenced his assessment on the value of the Community Poll: [104].

Botany’s submission amounts to a contention that the Delegate should have informed Botany of his thinking on one issue among many in examining the Minister’s Proposal. Procedural fairness did not require the Delegate to take this course: [108].

Judgment

1. BATHURST CJ: I agree with the orders proposed by Sackville AJA and with his Honour’s reasons.

2. WARD JA: I have had the advantage of reading in draft the reasons of Sackville AJA, with which I agree.  I also agree with the orders his Honour proposes.

3. SACKVILLE AJA: The applicant, Botany Bay City Council (Botany) seeks leave to appeal from a decision of a Judge of the Common Law Division (Garling J). The proceedings arise out of a proposal by the second respondent, the Minister for Local Government (Minister), for the amalgamation of Botany and Rockdale City Council (Rockdale).

4. The primary Judge dismissed a claim for declaratory and other relief brought by Botany on the ground that the Minister, a delegate of the Chief Executive of the Office of Local Government (Delegate) and the Local Government Boundaries Commission (Commission) exceeded their statutory powers in various ways. [1] Botany requires leave to appeal because the proceedings determined by the primary Judge were in the nature of an application for judicial review and, as Botany accepts, it does not satisfy the monetary threshold for an appeal as of right. [2]

   1. Botany Bay City Council v State of New South Wales [2016] NSWSC 583 (Primary Judgment).

   2. Supreme Court Act 1970 (NSW) s 101(2)(r). An appeal is of right, relevantly, if the matter in issue amounts to the value of $100,000 or more.

5. The respondents to the application for leave to appeal, apart from the Minister, are the State of New South Wales (State), the Delegate and the Commission. It is not clear why the State is a party in the proceedings since no relief is sought against it. In any event, all four respondents were represented by Mr Kirk SC, who appeared with Mr Hutton and Ms Ellicott. Mr Robinson SC appeared with Mr Jackson for Botany.

6. The application for leave to appeal was listed for hearing concurrently with argument on the appeal. However, Botany’s written submissions frankly conceded that three of the grounds contained in the draft Notice of Appeal (Grounds 10-12) had not been argued before the primary Judge. These grounds alleged that the Minister’s decision-making process on council amalgamations manifested actual bias on the Minister’s part or, alternatively, was affected by an apprehension of bias. Botany gave no satisfactory reason for not raising these issues at the trial. Further, if the issues had been raised, the respondent may have wished to adduce further evidence relating to the decision-making process. Accordingly, the Court refused Mr Robinson leave to advance these arguments for the first time on the application for leave to appeal. They may therefore be put to one side.

7. Botany’s written submissions divided the remaining ten grounds of appeal into three groups. [3] In summary, the grounds pressed on the appeal are as follows:

•   Grounds 1-8: The primary Judge should have held that the Commission Review on the Proposed Merger of City of Botany Bay and Rockdale City Councils dated 3 May 2016 (Commission Review) was ultra vires because the Commission misconstrued the powers and functions conferred on it by s 218F(6)(b) of the Local Government Act 1993 (NSW) (LG Act).

•   Ground 9: The primary Judge erred in finding that the Minister afforded Botany procedural fairness, notwithstanding that the Minister allowed Botany only a limited time to make submissions on the Commission Review and a report prepared in March 2016 by the Delegate to the Chief Executive of the Office of Local Government (Chief Executive) on the Merger Proposal.

•   Ground 13: The primary Judge should have found that the Delegate denied procedural fairness to Botany, in that he did not afford Botany an opportunity to answer adverse findings he proposed to make about a “community poll” conducted by Botany on the Merger Proposal.

3.    Mr Robinson accepted that Ground 14, which complains that the Minister impermissibly considered the merits of material distributed by Botany to the residents concerning the Merger Proposal, does not add anything to the other grounds.

The Statutory Scheme

8. Chapter 9 of the LG Act is headed “How are councils established?”. Part 1 of Chapter 9 deals with “Areas”, defined in the LG Act to mean areas constituted under Division 1 of Part 1. [4]

   4.    The word “area” is defined in the Dictionary to the LG Act.

9. Division 1 of Part 1 of Chapter 9 empowers the Governor, by proclamation, to constitute any part of New South Wales as an “area” and to determine the boundaries of the area (s 204(1), (2)). An area may be constituted as a city (s 206). The power to constitute an area under s 204 can be exercised only after a proposal for the exercise of the power has been formulated and dealt with under Division 1 (s 214).

10. The present case does not concern the exercise of a power under Division 1 but under Division 2A, which specifies how areas are amalgamated or their boundaries altered. The power to amalgamate is contained in s 218A of the LG Act, which provides as follows:

“218A Amalgamation of areas

(1)    The Governor may, by proclamation, amalgamate two or more areas into one or more new areas.

(2)    On the date specified in the proclamation as the date on which the areas are to be amalgamated:

(a)    the areas are dissolved, and

(b)    the new area or new areas are constituted, and

(c)    subject to section 218C, the councillors of the former areas cease to hold office.

(3)    Divisions 1 and 2 apply to a new area constituted by a proclamation under this section in the same way as they apply to an area constituted by a proclamation under section 204.

…”

11. Section 218B provides that the Governor may, by proclamation, alter the boundaries of two or more areas.

12. Division 2B of Part 1 of the LG Act sets out what must be done before areas can be amalgamated or their boundaries altered. The relevant provisions in Division 2B are as follows:

“218D Exercise of functions under secs 218A and 218B

A function under section 218A or 218B may be exercised only after a proposal for the exercise of the function is dealt with under this Division.

218E Who may initiate a proposal?

(1)    A proposal may be made by the Minister or it may be made to the Minister by a council affected by the proposal or by an appropriate minimum number of electors.

…

218F Referral of proposal for examination and report

(1)    On making or receiving a proposal, the Minister must refer it for examination and report to the Boundaries Commission or to the Departmental Chief Executive. [5]

5.    “Departmental Chief Executive” is defined in the Dictionary to mean the Chief Executive of the Office of Local Government.

(2)    Sections 263, 264 and 265 apply to the examination of a proposal by the Departmental Chief Executive in the same way as they apply to the examination of a proposal by the Boundaries Commission.

(3)    For the purpose of examining a joint proposal of 2 or more councils for the amalgamation of two or more areas under section 218A, the Boundaries Commission or Departmental Chief Executive, as the case requires, must seek the views of electors of each of those areas:

…

(6)    If a proposal that is not supported by one or more of the councils affected by it, or that is an amalgamation proposal, has been referred to the Departmental Chief Executive under subsection (1):

(a)    the Departmental Chief Executive must furnish the Departmental Chief Executive’s report to the Boundaries Commission for review and comment, and

(b)    the Boundaries Commission must review the report and send its comments to the Minister.

(7) The Minister may recommend to the Governor that the proposal be implemented:

(a)    with such modifications as arise out of:

(i)    the Boundaries Commission’s report, or

(ii)    the Departmental Chief Executive’s report (and, if applicable, the Boundaries Commission’s comments on that report), and

(b)    with such other modifications as the Minister determines,

but may not do so if of the opinion that the modifications constitute a new proposal.

(8) The Minister may decline to recommend to the Governor that the proposal be implemented.”

[Emphasis and citations added.]

13. Part 3 of the LG Act (ss 260-265) constitutes the Commission as a body corporate (s 260). The Commission consists of four Commissioners appointed by the Governor (s 261(1)). One Commissioner is to be nominated by the Minister, one is to be a Departmental Officer nominated by the Departmental Chief Executive and two are to be approved from a panel of eight councillors nominated by the Executive of the Local Government and Shires Association of New South Wales (ss 261(2), 262(1)). The Minister’s nominee is the Chairperson of the Commission (s 261(4)).

14. Section 263 of the LG Act provides as follows:

“263 Functions of the Boundaries Commission

(1)    The Boundaries Commission is required to examine and report on any matter with respect to the boundaries of areas and the areas of operation of county councils which may be referred to it by the Minister.

(2)    For the purpose of exercising its functions, the Boundaries Commission:

(a)    may hold an inquiry if the Minister so approves, and

(b)    must hold an inquiry if the Minister so directs,

but may not hold an inquiry otherwise than as referred to in paragraph (a) or (b).

(2A)    Despite subsection (2), the Boundaries Commission must hold an inquiry for the purpose of exercising its functions in relation to a proposal for the amalgamation of two or more areas that has been referred to it in accordance with section 218F.

(2B)    Reasonable public notice must be given of the holding of an inquiry under this section.

(3)    When considering any matter referred to it that relates to the boundaries of areas …, the Boundaries Commission is required to have regard to the following factors:

(a)    the financial advantages or disadvantages (including the economies or diseconomies of scale) of any relevant proposal to the residents and ratepayers of the areas concerned,

(b)    the community of interest and geographic cohesion in the existing areas and in any proposed new area,

(c)    the existing historical and traditional values in the existing areas and the impact of change on them,

(d)    the attitude of the residents and ratepayers of the areas concerned,

(e)    the requirements of the area concerned in relation to elected representation for residents and ratepayers at the local level, the desirable and appropriate relationship between elected representatives and ratepayers and residents and such other matters as it considers relevant in relation to the past and future patterns of elected representation for that area,

(e1)    the impact of any relevant proposal on the ability of the councils of the areas concerned to provide adequate, equitable and appropriate services and facilities,

(e2)    the impact of any relevant proposal on the employment of the staff by the councils of the areas concerned,

…

(e5)    in the case of a proposal for the amalgamation of two or more areas, the need to ensure that the opinions of each of the diverse communities of the resulting area or areas are effectively represented,

(f)    such other factors as it considers relevant to the provision of efficient and effective local government in the existing and proposed new areas.

…

(5)    The Boundaries Commission must allow members of the public to attend any inquiry held by the Commission under this section.

…

(7)    The Supreme Court may not make an order in the nature of prohibition in respect of, or an order for removing to the Court or quashing, any decision or proceeding made or conducted by the Boundaries Commission in connection with the exercise of its functions.”

15. The effect of s 263(7), as a privative clause, is that the Supreme Court cannot exercise its powers of judicial review in respect of any decision by the Commission unless it is affected by a “jurisdictional error”. [6]

    6. Kirk v Industrial Relations Commission of New South Wales [2010] HCA 1; 239 CLR 531.

16. Section 264(1)(a) of the LG Act provides that a person is not entitled to be legally represented in proceedings before the Commission. However, this does not prevent, among other things, a mayor of a council appearing before the Commission or a lawyer assisting in the preparations of documentation (s 264(2)(b),(c)).

17. Section 265 empowers the Commission to conduct an opinion poll of residents and ratepayers to assist in determining the attitude of residents and ratepayers of an area for the purposes of s 263(3)(d).

Factual Background

18. Part of the background to the current dispute is recounted in judgments delivered in the Land and Environment Court (L&E Court) and this Court involving the same parties. [7] The following account is partly taken from the Primary Judgment, which in turn draws on the earlier judgments.

    7. Botany Bay City Council v Minister for Local Government [2016] NSWLEC 35 (Pain J); Botany Bay City Council v Minister for Local Government [2016] NSWCA 74; 214 LGERA 173.

18. On 6 January 2016, the Minister referred a proposal to amalgamate Botany with Rockdale (Minister’s Proposal) to the Chief Executive for examination and report pursuant to s 218F(1) of the LG Act. On the same day, the Chief Executive, pursuant to s 745(1) of the LG Act, delegated his functions in respect of the Minister’s Proposal to the Delegate. (By reason of s 218F(2) of the LG Act, s 263 applied to the Delegate’s examination of the Minister’s Proposal in the same way as it would have applied to the Commission had the Minister referred the Proposal to the Commission.)[8] On 7 January 2016, the Delegate notified Botany of his appointment to examine and report on the Minister’s Proposal.

    8. See Botany Bay City Council v Minister for Local Government [2016] NSWCA 74; 214 LGERA 173 at [24] (per curiam).

19. In the two-week period up to and including 27 February 2016, Botany held a “Community Poll”, in which residents were invited to vote on the Merger Proposal. Residents were asked to vote on the following question:

“Do you agree that the City of Botany Bay should merge with Rockdale City Council?”

Of the 8,070 residents who voted, 7,877 (98 per cent) voted “No”.

21. On 28 February 2016, Botany sent the Delegate a carefully prepared and presented submission opposing the Minister’s Proposal. The submission, including documentation relating to the Community Poll, indicated that the results of the Poll would be addressed in an Addendum to the submission.

22. On 3 March 2016, Botany forwarded the Addendum to the Delegate who agreed to receive it. The Addendum recorded the results of the Community Poll and added other material in support of Botany’s opposition to the Merger Proposal.

23. On 11 March 2016, Botany lodged its own proposal with the Minister (Botany Proposal). In this proposal, Botany suggested that it should be amalgamated with some parts of Rockdale, but also with parts of Randwick City Council and Sydney City Council. In a covering letter, Botany requested that the Botany Proposal not only be referred urgently to the Chief Executive, but that it be “…referred to the Delegate currently considering the Minister’s proposal…”.

24. On 18 March 2016, the Botany Proposal was referred by the Minister to the Chief Executive pursuant to s 218F(1) of the LG Act. On 21 March 2016, Botany’s legal representatives wrote to the Delegate, enclosing the letter to the Minister of 11 March 2016 and a copy of the Botany Proposal. On the same day, Botany’s legal representatives wrote to the Chief Executive seeking confirmation that the Botany Proposal had been referred to the Delegate who was to consider the Minister’s Proposal. On 22 March 2016, the Crown Solicitor’s Office stated that the Delegate would consider the Botany Proposal lodged on 28 February 2016, but that any review of the Botany Proposal remained a matter for the Chief Executive.

25. On 23 March 2016, Botany filed a summons in the L&E Court, seeking an order that the Botany Proposal be considered by the Delegate in the course of his examination of the Minister’s Proposal. On 7 April 2016, Pain J dismissed the proceedings. On 15 April 2016, the New South Wales Court of Appeal dismissed an expedited appeal against the decision of Pain J.

26. On 20 April 2016, the Delegate forwarded the Delegate’s Report to the Chairperson of the Commission for review and comment pursuant to s 218F(6) of the LG Act. The Delegate’s Report was entitled “Examination of the Merger Proposal: City of Botany Bay Council Rockdale City Council As proposed by the Minister for Local Government, the Hon Paul Toole MP”. I refer to the contents of the Delegate’s Report in more detail later. [9]

    9. See at [50]-[54] below.

27. On the same day, 20 April 2016, the Chief Executive delegated his functions in respect of the Botany Proposal to a different officer (New Delegate). On 21 April 2016, the New Delegate advised Botany that he was accepting submissions on the Botany Proposal until 12 June 2016.

28. On 22 April 2016, Botany’s legal representatives wrote to the Crown Solicitor’s Office, requesting that Botany be given a copy of the Delegate’s Report on the Minister’s Proposal and the Commission’s review of that report. On 26 April 2016, the Crown Solicitor’s Office responded to that letter, stating that the Minister “… does not propose to release the Delegate’s Report until after he makes a recommendation to the Governor”. The letter also advised that the Minister was unable to provide confirmation “… as to taking into account [the Botany Proposal] before making any final decision with respect to his proposal …”.

29. On 3 May 2016, the Chairperson of the Commission forwarded the Commission Review to the Minister. The covering letter stated that the Commission was providing its comments on the Delegate’s Report into the proposed merger of Botany and Rockdale pursuant to s 218F(6) of the LG Act. I also refer to the contents of the Commission Review in more detail later. [10]

    10. See at [55]-[60] below.

30. Also on 3 May 2016, Botany filed a Summons in the Supreme Court seeking relief against the Minister with respect to the exercise of his powers and duties under the LG Act. The Summons sought orders precluding the Minister from making a recommendation to the Governor on his proposal until the examination and report of the Botany Proposal was completed. The Summons also sought a declaration that procedural fairness required the Minister to provide Botany with the Delegate’s Report and the Commission Review and a corresponding opportunity to make further submissions on that material.

31. On 5 May 2016, the Summons came before Garling J for hearing. The Minister opposed the relief sought. At the end of the hearing, Garling J reserved judgment and informed the parties that judgment would be delivered at 12.45 pm on 13 May 2016. The Minister gave an undertaking not to make a recommendation to the Governor in respect of the Minister’s Proposal prior to 2.00 pm on 13 May 2016.

32. In the late afternoon of 12 May 2016, the Minister called a press conference to announce the amalgamation of various councils and the creation of 19 new councils in New South Wales. He also announced that a new “Stronger Councils” website, accessible by the public, had gone live.

33. A page on its website was devoted to the Minister’s Proposal. The page recorded the Minister’s announcement of “in principle support” for the proposed merger of Botany and Rockdale, subject to the decision of the courts. The website also made available for download the Delegate’s Report on the Minister’s Proposal, dated 20 April 2016, the Commission Review, dated 3 May 2016, and the submissions made to the Delegate in the course of his examination and report on the Minister’s Proposal.

34. On 12 May 2016, the Minister also issued a media release headed as follows:

“DELEGATE REPORT INDICATES BENEFITS IN A NEW ROCKDALE-BOTANY COUNCIL”

Amongst other things, it said:

“[The] Minister … has said he supports in principle the creation of a new council for Rockdale and Botany, subject to the decision of the court.

…

‘The delegate’s report into the proposed merger of Rockdale and Botany Councils has found a stronger council will deliver financial and community benefits’, [the Minister] said.

…

[The Minister] said that it would be business as usual for local residents under a new council.

…

Under a new council, the delivery of key services would remain unchanged.”

35. Immediately before Garling J was due to deliver judgment on 13 May 2016, Botany filed a Notice of Motion seeking leave to re-open the proceedings and to file an Amended Summons. The Amended Summons sought to join the Delegate and the Commission, as defendants, in addition to the State and the Minister. In consequence of those developments, Garling J did not deliver judgment as scheduled, but stood the matter over for a further hearing.

36. On 16 May 2016, the Crown Solicitor’s Office wrote to Botany’s solicitor, as follows:

“I am instructed to invite your client to provide any written submissions that it might wish to make in relation to either or both of those reports [that is, the Delegate’s Report and the Commission Review], on or before 5pm on 20 May 2016. The Minister will consider any submissions received before that time.”

37. On the following day, 17 May 2016, Botany’s solicitors response included this comment:

“The Minister cannot now seek submissions because an amalgamation decision has already been made by him in respect of our client.”

Notwithstanding this comment, the solicitors advised that in order for submissions to be fairly and lawfully called for by the Minister, Botany required a longer period than the Minister had stipulated. The solicitors sought a period of 14 days from when the matter was due to return to court (19 May 2016) in which to make submissions.

38. Later on 17 May 2016, the Crown Solicitor’s Office informed Botany’s solicitors that the Minister:

“… considers that 7 days from the time when your client became aware of contents of the delegate’s report of the Boundaries Commission comments, is a sufficient period, given the extensive opportunity given to your client to be heard before the delegate …”

The letter stated that the Minister did not accept that Botany required 14 days to prepare its submissions and reiterated that a submission received by 20 May 2016 would be considered.

39. On 19 May 2016, Botany’s application to re-open the proceedings and to file an Amended Summons came before Garling J for hearing. His Honour heard argument on the additional grounds agitated by Botany and reserved judgment. His Honour dismissed the Amended Summons in the Primary Judgment, delivered on 9 June 2016.

Further Evidence

40. In these proceedings the respondents filed a Notice of Motion pursuant to s 75A(7) of the Supreme Court Act 1970 (NSW) seeking to tender further evidence on the application for leave to appeal. [11] The evidence, which consisted of correspondence between the parties post-dating the hearing in the Common Law Division, was admitted without objection. The correspondence is summarised as follows.

    11. Section 75A(7) empowers the Court to receive further evidence in an appeal. Although the Court is not to receive further evidence except on special grounds following a hearing on the merits (s 75A(8)), this qualification does not apply to evidence concerning matters occurring after the trial (s 75A(9)).

41. On 20 May 2016, Botany wrote to the Minister’s legal representatives noting the Crown Solicitor’s advice on 16 May 2016 that Botany had until 20 May 2016 to make submissions on the Delegate’s Report and the Commission Review. The letter pointed out that Botany had sought 14 days in which to make submissions in the original Summons (filed on 3 May 2016). Botany now requested until 3 June 2016 to provide “detailed and considered submissions”. As a “precautionary measure”, the letter provided “limited submissions” as to what were said to be inaccuracies in the Delegate’s Report. The “limited submissions” extended over seven single-spaced pages. The letter also attached copies of Botany’s submissions filed in the Common Law Division proceedings.

42. On 27 May 2016, Botany’s solicitors wrote to the Crown Solicitor seeking urgent advice as to whether the Minister was prepared to grant an extension of time for further submissions. The solicitors wrote again on Thursday, 2 June 2016, noting that they had received no response to the request for an extension.

43. The Crown Solicitor replied, by email the same evening, apologising for the delay and advising that the Minister would consider any submissions received by 5.00 pm on Wednesday, 8 June 2016.

44. On 7 June 2016 at 10.29 am, Botany’s solicitors sent an email to the Crown Solicitor stating that Botany was having difficulty preparing an adequate response in the short time period provided by the Minister and requested 14 days “to put more considered submissions”.

45. On 8 June 2016 at 5.35 pm, the Crown Solicitor advised that the Minister was prepared to undertake not to make a recommendation to the Governor until 5.00 pm on 14 June 2016 and that the Minister was willing to extend the time for Botany’s further submissions until midday on 14 June 2016.

46. Botany’s solicitors, by an email sent on 8 June 2016, complained that the Minister was continuing to give only short extensions to lodge Botany’s submissions. The solicitors requested a further 14 days, noting that “[i]f we had been given that time period previously then the submissions would have been prepared and presented by now”.

47. On Friday, 17 June 2016, the Crown Solicitor wrote to Botany’s solicitors as follows:

“Although we are of the view that Botany Council has been given sufficient time to make submissions to the Minister and the Council did not provide any further submissions by 14 June, as the Minister has given an undertaking not to make a recommendation to the Governor until the date of the Court of Appeal hearing on 29 June, he is prepared to consider any further submissions received by Botany Council before that date.”

48. On 28 June 2016, Botany emailed its submissions to the Minister. The submissions stated that Botany considered the exercise to be futile in the circumstances, but that it was nonetheless making further submissions which were to be read in conjunction with Botany’s preliminary submission that had been provided to the Minister on 20 May 2016.

49. The submissions made detailed criticisms of what were said to be inadequacies and inaccuracies in the Delegate’s Report and the Commission Review. Among other contentions, Botany argued that the Delegate failed to attach proper weight to the Community Poll and that both the Delegate and the Commission underestimated the extent to which the Merger Proposal would diminish connections between Botany and Rockdale in their respective traditional communities.

The Statutory Reports

The Delegate’s Report

50. Chapter 2 of the Delegate’s Report provided an overview of the Minister’s Proposal. Chapter 3 outlined the methodology adopted by the Delegate. He noted that he was required by s 218F(3) of the LG Act to seek the views of the electors in Botany and Rockdale. The Report explained the steps that had been taken to invite and receive public submissions and to conduct public inquiries in the two council areas. It also recorded that each of the 130 written submissions received by the Delegate had been categorised according to the eleven factors stated in s 263(3) of the LG Act.

51. The Report then addressed each of the issues the Delegate was required by s 263 of the LG Act to take into account. For example, in Chapter 4 (“Finance”) the Delegate examined the financial advantages and disadvantages of the Minister’s Proposal as required by s 263(3)(a) of the LG Act. The Delegate analysed competing estimates of the costs and savings likely to result from the proposed merger and concluded as follows:

“Given the quantum of savings to be achieved by a merged entity and the additional scale in managing council finances, a consideration of the financial advantages or disadvantages gives weight to the view that the proposal be supported.”

52. In Chapter 7 (“Attitudes”) the Delegate recorded that s 263(3)(d) of the LG Act required him to examine and report on “the attitude of residents and rate payers of the areas concerned”. Under this heading, the Delegate noted that Botany had conducted the Community Poll in which approximately 8,000 residents (18 per cent of the total) voted, with 98 per cent voting against the merger proposal. The Delegate gave the Community Poll little weight for these reasons:

“The Council of the City of Botany Bay campaigned vigorously against the proposal through its ‘Hands off Botany Bay’ campaign, and framed the poll as an opportunity for residents to voice their opposition rather than consider both the benefits and disadvantages of the proposal. Council were at liberty to campaign against the proposal, but to do so while conducting a poll and failing to provide a balanced treatment of the merits or defects of that proposal limits the value of that poll in the context of this public inquiry process. The results cannot be given full weight because there was not a proper campaign of communication and advocacy both in favour and in opposition to the proposal.

Residents of both [Local Government Areas] were provided a number of options to make a submission to this independent review and this Report has focused on these submissions.

…

The community poll undertaken by the City of Botany Bay has been noted by this review. However, it is noted that there was not a proper campaign of communication and advocacy both for and against the proposal.

The opposing views received in submissions to this review also express important attitudes for the Minister of Local Government to consider..”

53. The Delegate’s major findings were as follows:

“1.   That a merger between the Local Government Areas of Botany Bay and Rockdale would be of significant benefit to residents and ratepayers of the two existing [Local Government Areas] primarily due to the ability of a new council to use linkages to Sydney Airport and Port Botany for the economic and social benefit of the region.

2.   That residents of Botany Bay have a historical and traditional connection with the Eastern Sydney region and that residents of Rockdale have a historical and traditional connections with the St George region, creating two distinct communities of interest. This review does not believe a new council will diminish these connections.”

54. The Delegate recommended to the Minister that the proposed merger proceed, subject to consideration by the Commission and approval by the Minister. The Delegate also drew attention to several other matters warranting attention and consideration by the Minister, the Commission and the new council. The Delegate suggested, among other things, that consideration be given to including Sydney Airport and Port Botany within the boundaries of the new council and holding a “constitutional referendum” pursuant to s 16 of the LG Act [12] to adopt an appropriate structure for establishing wards and the selection of a mayor.

    12. A constitutional referendum is a poll instituted by a council in order to give effect to a matter referred to in s 16: LG Act, s 15. The matters referred to in s 16 include changes to words on the basis of which the mayor attains office.

The Commission Review

55. As Botany’s principal submission centres on the contention that the Commission misconceived its statutory functions, it is convenient to reproduce the extracts from the Commission Review relied on by Mr Robinson in support of the submission.

56. Section 1 of the Commission Review summarised the Commission’s comments as follows:

“The Boundaries Commission has reviewed the Delegate’s Report on the proposed merger of City of Botany Bay Council and Rockdale City Council to determine whether it shows the legislative process has been followed and the Delegate has taken into account all the factors required under the Local Government Act 1993 (the Act).

The Commission has assessed that:

the Delegate’s Report shows that the Delegate has undertaken all the processes required by section 263 of the Act,

the Delegate’s Report shows that the Delegate has adequately considered all the factors required by section 263(3) of the Act, with the exception of the factor listed under subsection 263(3)(e5) (diverse communities), and

the Delegate’s recommendation in relation to the proposed merger is supported by the Delegate’s assessment of the factors.”

[Emphasis in original.]

57. Section 3 of the Commission Review explained the Commission’s view of its role:

“The Local Government Boundaries Commission is an independent statutory authority constituted under section 260 of the Act. The Boundaries Commission examines and reports on any matter referred to it by the Minister in relation to the boundaries of local government areas and the areas of operation of county councils.

The Boundaries Commission has several functions under the Act. In the current context (where the Minister has elected to refer the proposal to the Office of Local Government, rather than the Boundaries Commission, for examination), the most relevant Commission functions are set out in section 218F(6) of the Act. This section requires:

the Chief Executive to furnish the Report on the examination of the merger proposal to the Boundaries Commission for review and comment, and

the Boundaries Commission to review the Report and send its comments to the Minister.

The Commission’s role does not involve re-examining the advantages and disadvantages of the proposed mergers, accepting submissions or holding public inquiries.”

[Emphasis added.]

58. Section 4 of the Commission Review reproduced the Delegate’s key recommendations (that the merger proceed subject to the Commission’s consideration and the Minister’s approval) and the matters the Delegate proposed for further consideration.

59. Section 5 contained the Commission’s comments on the Delegate’s Report, organised by reference to each of the mandatory considerations identified in s 263(3) of the LG Act. In all cases except two, the Commission concluded that “the Delegate adequately considered the issues under this factor”. In particular, the Commission considered that the Delegate had adequately considered the issues arising under s 263(3)(d) (“the attitude of the residents and ratepayers of the areas concerned”).

60. The first exception to the Commission’s endorsement of the Delegate’s approach was the absence in the Delegate’s Report of any discussion of “the impact [of the merger proposal] on senior staff” (s 263(3)(e2)). The second exception, recorded in Section 1 of the Commission Review, was that the Delegate had not adequately considered the issue arising under s 263(e5) (“the need to ensure that the opinions of each of the diverse communities of the resulting area or areas are effectively represented”). The Commission added that the boundary adjustments and the name for a new council suggested by the Delegate were matters for the Minister.

Primary Judgment

61. The primary Judge gave reasons for granting Botany leave to file an Amended Summons to join the Delegate and the Commission as parties to the proceedings. No issue arises on the present application concerning the grant of leave.

62. His Honour addressed Botany’s contention that the Delegate had denied it procedural fairness by dismissing the significance of the Community Poll without giving Botany the opportunity to respond to the Delegate’s concerns. According to Botany, the Delegate should have informed it that he considered the Community Poll to have been tainted by Botany’s obvious opposition to the merger and allowed Botany to answer that criticism.

63. The primary Judge examined in detail the public statements made by the Deputy Mayor of Botany in relation to the Minister’s Proposal and the information provided to residents prior to or during the Community Poll. His Honour observed that it was not the Court’s function to decide whether the Minister’s claimed benefits for the merger would be achieved. Rather, the question was whether Botany had demonstrated, contrary to the Delegate’s Report, that it “conducted a balanced campaign for and against the Minister’s Proposal”. [13]

    13. Primary Judgment at [86].

64. His Honour concluded that Botany had not demonstrated any error in the Delegate’s Report in this respect. [14] Botany had clearly waged a campaign against the merger and the information it provided to residents had not presented the arguments in favour and against the merger in a balanced manner. In any event, the Delegate did not suggest that the Minister should ignore the results of the Community Poll, but drew matters to the attention of the Minister that might affect the weight to be given to the expressions of opinion by those who participated. [15]

    14. Primary Judgment at [87].

    15. Primary Judgment at [101].

65. The next question was whether the Delegate was bound to extend procedural fairness to Botany in relation to the Community Poll. His Honour answered the question as follows:[16]

“Accepting, without deciding, that the Delegate was obliged to give the Council procedural fairness after he had concluded his examination of the Minister’s proposal and prior to delivering his report to the Commission for review and comment, the content of that obligation did not extend to revealing the entirety of his report including his attribution of diminished weight to any of the mandatory considerations. Nor did it extend to his conclusions about the arguments, either explicitly or implicitly advanced by the Council, which related to the Minister’s Proposal.”

16. Primary Judgment at [103].

66. The primary Judge added that having regard to the matters known to Botany, it had contemplated that the weight to be given to its submissions (including the results of the Community Poll) was a topic that it could address in its submissions. [17]

“[Botany] was not entitled to be notified by the Delegate of his reasoning process, or his decision to diminish the weight of a submission or to balance an unqualified submission against other material known to, or received by, his inquiry or which might be regarded as material in the public domain. That is all that occurred here. … [T]here was no breach of procedural fairness.” [18]

17. Primary Judgment at [108].

18. Primary Judgment at [108].

67. Botany contended before the primary Judge that the Commission misconstrued the nature of its functions and powers when dealing with the Delegate’s Report. In particular, it submitted that the Commission wrongly construed s 218F(6)(b) of the LG Act as limiting it to determining whether the Delegate’s Report, on its face, showed that the statutory procedures had been followed and that the Delegate had taken into account the mandatory considerations identified in s 263(3). According to Botany, the Commission should not have regarded itself as precluded from considering the merits of the Minister’s Report. The consequence was said to be that the Commission’s purported review of the Delegate’s Report was invalid.

68. The primary Judge held that s 218F(6)(b) of the LG Act did not require the Commission to conduct an inquiry of the kind it would have undertaken had the Minister’s Proposal been referred to it under s 218F(1) for “examination and report”. The Commission’s statutory function under s 218F(6)(b) was to review the Delegate’s Report, make comments on it and send the comments to the Minister. [19] The provision did not impose any mandatory requirements as to the contents of the Commission’s review of the Delegate’s Report. [20] It followed that the Commission had not misconceived its functions.

    19. Primary Judgment at [136].

    20. Primary Judgment at [138].

69. The second procedural fairness argument advanced by Botany was also rejected by his Honour. Botany had argued that the time allowed by the Minister on 16 May 2016 for it to make submissions on the Delegate’s Report was insufficient. In accordance with principle, the primary Judge observed that the requirements of procedural fairness vary according to the circumstances in which a statutory power is to be exercised. His Honour continued as follows:[21]

“[T]he content of the Minister’s proposal is open and contains information readily available to the public. It is public knowledge that the Minister’s Proposal seeks the dissolution of the Council and the creation of a new council to be the local government authority for the newly established area. The Council had the opportunity to make (and in fact made) submissions on that issue in the context of the Delegate’s inquiry and report. The requirements of procedural fairness, having regard to the statutory scheme in place under the Act, do not seem to me to oblige the Minister to give the Council any longer period than that actually provided. There is no evidence of inadequacy of resources on the part of the Council to make its submissions to the Minister within the time allowed. The length and content of the Delegate’s report, and the Commission’s comments, are not such as to suggest, without more, that a longer time is needed. The claimed inadequacy of time is simply an unsubstantiated assertion by the Council.”

21. Primary Judgment at [178].

70. The primary Judge rejected other arguments made on behalf of Botany which are not pursued on the application for leave to appeal. Accordingly, his Honour dismissed the Amended Summons.

Reasoning

71. It is convenient to begin with Ground 9 in the Draft Notice of Appeal and then deal with Grounds 1-8 and Ground 13.

Ground 9 – Procedural Fairness

72. Division 2A of Part 1 of Chapter 9 of the LG Act establishes a staged procedure for the amalgamation of council areas or the alteration of council boundaries. The Governor’s power to amalgamate two or more areas (s 218A(1)) or to alter the boundaries of one or more areas (s 218B) can be exercised only after a proposal is dealt with under Div 2B (s 218D). Where a Minister makes a proposal, it must be referred for “examination and report” either to the Commission or to the Chief Executive (s 218F(1)). A valid report by the Commission or the Chief Executive (as the case may be) is an essential pre-condition to the exercise of the Minister’s power to recommend to the Governor that a proposal be implemented, with or without modifications (s 218F(7)). [22]

    22. Minister for Local Government v South Sydney City Council [2002] NSWCA 288; 55 NSWLR 381 at [17] (Spigelman CJ, Ipp AJA agreeing) (“South Sydney”).

73. The Minister’s Proposal in the present case was referred to the Chief Executive, who duly delegated his functions to the Delegate. Where a proposal is referred to the Chief Executive, the legislation provides for a three-stage procedure. First, the Chief Executive must examine the proposal in accordance with the requirements of s 263 of the LG Act (s 218F(2)) and report to the Commission (ss 218F(2), 263(1)). Secondly, if the proposal is not supported by one of the councils concerned, the Chief Executive must furnish his or her report to the Commission for “review and comment” which is then required to send its comments to the Minister (s 218F(6)). Thirdly, the Minister is empowered to recommend to the Governor that the proposal be implemented, with any such modifications as arise out of the Chief Executive’s report or the Commission’s comments as the Minister sees fit (s 218F(7)). However, the Minister may decline to recommend that the proposal be implemented (s 218F(8)).

74. If the Minister refers a proposal to the Commission for examination and report (rather than to the Chief Executive), the legislation establishes a two-stage procedure. In such a case, the Commission conducts its examination in accordance with s 263 of the LG Act and reports directly to the Minister. The Minister then decides whether or not to make a recommendation to the Governor that the proposal be implemented.

75. It was pointed out in South Sydney, a case in which the Minister referred a proposal to the Commission for examination, that the requirements of procedural fairness may be in issue at each stage of the decision-making process. Spigelman CJ stated that the legislative scheme demonstrates that the “the most detailed consideration of the relevant issues is to take place at the first stage” of the process. [23] Thus, where a proposal is referred to the Commission for examination and report, it may hold an inquiry if the Minister approves, but must hold an inquiry if the Minister so directs (s 263(2)). If the referred proposal is for the amalgamation of two or more areas, the Commission is obliged to hold an inquiry (s 263(2A)). When undertaking its examination of the proposal, the Commission (unlike the Minister) must have regard to the considerations in s 263(3).

    23. South Sydney at [35].

76. In South Sydney, Spigelman CJ identified two factors which indicate that a council affected by a proposal must be given an opportunity to be heard before the Commission, even if the council has a further opportunity to make representations to the Minister at the second stage of the process. The first factor is the role of the Commission in giving detailed consideration to the proposal in accordance with the statutory procedures. [24] The second is the status of the Commission as a body that has expertise in local government and enjoys “a degree of independence” from the Minister. [25]

    24. South Sydney at [35].

    25. South Sydney at [36]-[37].

77. Precisely the same reasoning cannot be applied where the Minister refers a proposal to the Chief Executive, rather than to the Commission. While the Chief Executive (or a delegate) might be expected to have expertise in local government issues, he or she does not necessarily enjoy the same degree of independence from the Minister as the Commission. It is presumably for this reason that the Chief Executive’s report is subject to review and comment by the Commission before the Minister is empowered to make a recommendation to the Government.

78. Nonetheless, substantially for the reasons given in South Sydney, the text and structure of the legislation indicate that where a proposal is referred to the Chief Executive for examination and report, he or she is responsible for the most detailed consideration of the merits of the proposal and must give an affected council an opportunity to be heard on that question. Such a conclusion is difficult to resist in light of the nature of the task entrusted to the Chief Executive and the statutory procedures that must be followed.

79. Nevertheless, the obligation on the Chief Executive to afford procedural fairness to a council adversely affected by a Minister’s proposal does not necessarily relieve the Minister from an obligation to afford procedural fairness to the council at the final stage of the decision-making process. The nature and extent of the Minister’s obligation is, however, likely to be influenced by the opportunities that council has had to make representations at earlier stages of the process. As the High Court observed in Brettingham-Moore v St Leonards Corporation,[26] it “is in relation to the carrying out of the whole process prescribed by the statute that the question as to the requirements of natural justice is to be considered”.

    26. [1969] HCA 40; 121 CLR 509 at 521 (Barwick CJ, Menzies and Windeyer JJ agreeing) cited in South Sydney at [28] (Spigelman CJ).

80. The parties appear to have accepted before the primary Judge that the Minister was required to afford procedural fairness to Botany. In this Court, Botany made no criticism of the primary Judge’s statement of principle governing the nature of the Minister’s obligation. His Honour accepted that a statutory decision-maker must ordinarily provide a person whose interests might be adversely affected by the decision with an opportunity to deal “with adverse information that is credible, relevant and significant” to the decision to be made. [27] However, as his Honour pointed out, the requirements of procedural fairness are flexible and vary according to the circumstances in which the power is to be exercised. [28] What is required in a particular case has to take account of the fundamental principle that procedural fairness is “not concerned with the merits of a particular exercise of power but with the procedure that must be observed in its exercise”. [29]

    27. Primary Judgment at [176] citing Applicant VEAL of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs [2005] HCA 72; 225 CLR 88 at [15] (per curiam) (“Applicant VEAL”) applying Kioa v West [1985] HCA 81; 159 CLR 550 at 629 (Brennan J).

    28. Primary Judgment at [174] citing Kioa v West [1985] HCA 81; 159 CLR 550 at 612 (Brennan J).

    29. Applicant VEAL at [16].

81. The primary Judge gave cogent reasons for finding that the Minister provided Botany with a reasonable opportunity to put its arguments. No doubt the Minister might have reduced the scope for disputation had he released the Delegate’s Report and the Commission Review earlier than 12 May 2016 and had he expressly invited submissions from Botany at the same time. But the fact is that Botany had the opportunity to prepare and present detailed submissions to the Delegate on the Minister’s Proposal. It took full advantage of that opportunity to make out its case. For the reasons I have given, the opportunity already afforded to Botany was an important consideration for the primary Judge to take into account in determining whether the Minister had given Botany a reasonable time in which to prepare its submissions addressing the Delegate’s Report and the Commission Review.

82. The Delegate’s Report and the Commission Review were publicly released on 12 May 2016. On 16 May 2016, the Minister’s legal representatives advised Botany that the Minister would receive any further submissions lodged before 5pm on 20 May 2016. This time frame gave Botany seven clear days from the public release of the Delegate’s Report and the Commission Review to make further submissions. As the primary Judge observed, there was no evidence to substantiate Botany’s assertion that it had insufficient time to address any “credible, relevant and significant” adverse information. [30] Moreover, Botany was familiar with the issues addressed in the Delegate’s Report since it had already made submissions on the merits of the Minister’s Proposal by reference to the mandatory statutory criteria.

    30. Primary Judgment at [178].

83. Taking into account the “whole process prescribed by statute”, it was not incumbent on the Minister to grant Botany sufficient time to prepare an entirely fresh set of submissions canvassing the merits and drawbacks of the Minister’s proposal. The Minister’s obligation went no further than allowing Botany an adequate opportunity to identify and correct what it considered to be factual errors and misconceptions in the Delegate’s Report or the Commission Review. Botany explained neither to the primary Judge nor this Court why the time allowed by the Minister for this purpose was insufficient.

84. In these circumstances, independently of the further evidence tendered on the application for leave to appeal, I would reject Botany’s claim that the primary Judge erred in not finding that the Minister denied Botany procedural fairness.

85. In any event, the further evidence admitted on Botany’s application for leave to appeal makes it clear that the Minister provided Botany with an adequate opportunity to make submissions prior to a recommendation being made to the Governor. Botany was given until 29 June 2016 to make its submissions. This deadline was nearly seven weeks after both the Delegate’s Report and the Commission’s Review had been publicly released. It is true that the Minister’s representatives extended the deadline successively by short periods, but the last extension granted on 17 June 2016 was for 12 days, only two days fewer than the 14 days Botany’s solicitors sought in their letter of 8 June 2016. In fact, Botany forwarded its submissions to the Minister on the Delegate’s Report and Commission Review on 28 June 2016. The submissions themselves give little or no indication that Botany would have made additional or more powerful arguments had it been given further time.

86. Even if the primary Judge (contrary to my view) had fallen into error on the procedural fairness issue, I would not have granted relief to Botany. As a practical matter, it has had the opportunity to make submissions to the Minister and has not been denied procedural fairness. I would therefore refuse Botany leave to appeal on Ground 9.

Grounds 1-8: The Commission’s Functions

Botany’s Submissions

87. Botany submitted that the Commission misconstrued its powers and functions under s 218F(6)(b) of the LG Act. It follows, according to Mr Robinson, that the Commission Review was ultra vires and the Commission therefore a nullity. He further submitted that the primary Judge should have set aside the Minister’s “decision” on 12 May 2016 because the decision was based on the Commission’s flawed review of the Delegate’s Report. The last step in the submission is premised on the assumption that the Minister’s public announcement on 12 May 2016 as to his attitude to the merger proposal constituted a decision that is amenable to judicial review.

87. Botany submitted, as it had before the primary Judge, that the Commission wrongly considered that its functions were limited to checking whether the Delegate had addressed the mandatory considerations stated in s 263(3) of the LG Act. Mr Robinson maintained it was not necessary for Botany to define the “metes and bounds” of the Commission’s powers and duties under s 218F(6)(b). It was enough that the Commission incorrectly precluded itself from considering the advantages and disadvantages of the proposed merger of Botany and Rockdale. In so doing, it had confined itself to a “check-box compliance approach”, thereby turning itself into a “potential automaton”.

88. Mr Robinson submitted that the language used by the Commission made it clear that it eschewed any role in examining the merits of the proposed merger. He acknowledged there was a difference between the language used in s 218F(1) (“refer [a proposal] for examination and report”) and that used in s 218F(6)(b) (“furnish the….report for review and comment”). Nevertheless, Mr Robinson contended that the language used in s 218F(6)(b) is sufficiently broad to empower the Commission to have conducted, in effect, a rehearing on the merits of the Minister’s Proposal.

89. Mr Robinson also submitted, albeit rather faintly, that the Commission erred in accepting that the Delegate’s suggestion that the name of the new council and the boundary adjustments should receive further consideration were matters for the Minister. On this footing, the Commission’s error was said to be that it was obliged to consider whether modifications should be made to the Minister’s Proposal but had failed to discharge that function.

Determination

91. In addressing Botany’s submissions, it is convenient to start with the construction of s 263(1) of the LG Act. It will be recalled that s 263(1) requires the Commission (or, in the present case, the Chief Executive) to “examine and report on any matter with respect to the boundaries of areas…which may be referred to it by the Minister”.

92. This language appears to be very broad. However, in Botany Bay City Council v Minister for Local Government,[31] this Court held that the Chief Executive’s role, where the Minister refers a proposal for examination pursuant to s 218F(1), is constrained by the proposal that is the subject of the referral. The role of the Chief Executive in such a case is to examine and report on the proposal that has been referred by the Minister. Accordingly, the Court upheld the trial Judge’s conclusion that Botany’s separate proposal for the alteration of its boundaries was irrelevant to the Chief Executive’s examination of the Minister’s Proposal. [32]

    31. [2016] NSWCA 74; 214 LGERA 173 (“Botany Council”).

    32. [2016] NSWCA 74 at [35], [43]-[44].

93. It follows from the reasoning of the Court in Botany Council, that the functions of the Chief Executive on the referral of a proposal by the Minister are not at large, but are constrained by the purpose of the referral. The stark contrast between the language of ss 218F(1) and 263(1) on the one hand, and s 218F(6) on the other, demonstrates that the functions of the Commission in conducting a review of a report of the Chief Executive are substantially more confined than the functions of the Chief Executive in preparing a report on a proposal by the Minister. Under s 218F(6) the Commission is not to examine and report on the Minister’s proposal. Instead, the Commission is directed to review the Chief Executive’s report and send its comments to the Minister.

94. It is no doubt true, as Mr Robinson submitted, that the word “review”, considered in isolation, is capable of describing a reconsideration of the merits of the decision or a proposal. But s 218F(6) must be construed in context. The provision applies to an amalgamation proposal or a proposal that is not supported by at least one of the councils affected. It is the Chief Executive’s report on the proposal, not the proposal itself, that is to be furnished to the Commission for “review and comment”. The Commission is then required to “review the report and send its comments to the Minister”. The “comments” are clearly intended to be the views of the Commission arising from its review of the Chief Executive’s report.

95. Mr Robinson emphasised that, as pointed out by Spigelman CJ in South Sydney, the Commission has expertise in local government issues and enjoys a degree of independence from the Minister. However, these characteristics do not compel the conclusion that the Commission’s role under ss 218F(1) and 263(1) extends to re-examining the merits of a Minister’s proposal that has already been examined by the Chief Executive. The contrast in statutory language to which I have referred demonstrates that the Commission’s expertise and independence are to be utilised for a different purpose. The Commission’s primary function is to review the report already prepared by the Chief Executive and comment whether the Chief Executive has performed his or her functions in accordance with the legislation. If not, the Commission is to make such comments as it considers appropriate in order to assist the Minister in determining whether or not that the Governor implement the proposal, with or without modifications.

96. It is implicit in the language of s 218F(6) that the Commission’s role is not necessarily limited to commenting whether the Chief Executive’s report complies with the statutory requirements. Section 218F(7) contemplates that the Minister may recommend that the Governor implement the relevant proposal with such modifications as arise, inter alia, out of the Commission’s comments on the Chief Executive’s report. This language implies that the Commission, on the basis of its review of the Chief Executive’s report, may draw the Minister’s attention to matters that may warrant modification of the proposal. However, the statutory language does not imply that the Commission must go beyond a review of the Chief Executive’s report and undertake its own independent evaluation of whether the proposal should be recommended for implementation.

97. If Botany’s construction of s 218F(6) of the LG Act were to be accepted, the Commission would be entitled and perhaps bound to re-examine afresh the merits of the Minister’s proposal. Yet, in doing so, it would not be required to observe the statutory procedures that govern the Chief Executive’s examination of the merits of the proposal. For example, the Commission would be free to re-examine the merits of an amalgamation proposal without conducting an inquiry of the kind that the Chief Executive must undertake when examining the proposal on a referral under s 218F (see s 263(2A)). Not only would this set the Chief Executive’s examination of the proposal at nought, it would effectively negate the right of the public to participate in the decision-making process, contrary to the evident intention of the legislation. [33]

    33. See too LG Act, s 7(c), which states that one purpose of the Act is to “encourage and assist the effective participation of local communities in the affairs of government”.

98. Mr Robinson submitted that the Commission’s error was revealed in its statement that:

“the Commission’s role does not involve re-examining the advantages and disadvantages of the proposed merger, accepting submissions and holding inquiries.”

Putting aside the reference to “accepting submissions”, as to which no issue arises in the present case, this statement is unobjectionable. For the reasons I have given, the Commission’s role did not involve re-examining the merits of the Minister’s Proposal. Nor was the Commission empowered by the legislation to conduct inquiries when discharging its function of reviewing the Delegate’s Report.

99. Mr Robinson did not suggest that the Commission lacked power to make the comments on the Delegate’s Report summarised in Section 1 of the Commission Review. [34] His complaint was that the Commission did not go further. It is, however, one thing to recognise the Commission as having the power to make additional comments on the Delegate’s Report; it is quite another to contend that by choosing not to make additional comments the Commission committed an error of law, let alone a jurisdictional error that might invalidate its report.

    34. See at [56] above.

100. It follows from the foregoing that the Commission did not commit any legal error by observing that the name of the new council and the Delegate’s suggestion of a boundary realignment were matters for the Minister. There is nothing in the legislation that obliged the Commission to go any further than to draw these matters to the Minister’s attention with a view to considering whether the merger proposal should be modified.

101. For these reasons I reject Botany’s challenge to the validity of the Commission Review. It is not necessary to consider whether, if the challenge had been made good, any relief could be granted in respect of the Minister’s public announcement on 12 May 2016.

Ground 13

102. Botany submitted that the Delegate should have alerted it to his intention to place little weight on the Community Poll and given it an opportunity to dissuade him from that view prior to completion of the Delegate’s Report.

103. As I have noted, Botany was given an opportunity to make submissions to the Delegate and it did so by making detailed and well-presented submissions, comprising 118 pages. The submissions accorded the results of the Community Poll a prominent place in Botany’s argument against implementation of the Minister’s Proposal. The submissions also included copies of documents distributed to residents of Botany prior to the Community Poll. Among these was the information sheet which purported to set out the “Yes” case based on the Minister’s Proposal, and the “No” case based on the Botany Proposal.

104. The Delegate’s Report accurately recorded the results of the Community Poll and explicitly recognised that those voting had recorded their opposition to the Minister’s Proposal. However, the Delegate gave the Community Poll little weight because Botany had campaigned vigorously against the Minister’s Proposal and had framed the Community Poll as an opportunity for residents to voice their opposition to the Proposal. The Delegate also considered that Botany had not provided a balanced treatment of the merits or defects of the Minister’s Proposal.

105. The Delegate’s assessment essentially rested on his evaluation of the material that had been included in Botany’s submissions. For example, the Delegate’s assessment that Botany had failed to present a balanced treatment of the competing arguments was based on the contents of the information sheet provided to residents. The question is not whether the Delegate was right in his assessment (as the primary Judge appears to have thought) but whether the Delegate had to inform Botany of its thinking in relation to the Community Poll before finalising the report.

106. It must have been obvious to Botany from the outset that the Delegate would have to consider the weight that should be given to the results of the Community Poll. That no doubt explains why Botany’s submissions urged the Delegate to pay close regard to the overwhelming vote against the Minister’s Proposal. It must have been equally obvious that the Delegate would take into account Botany’s active opposition to the Minister’s Proposal and the nature of the information provided to residents.

107. Botany’s submissions to this Court did not identify any significant factual matter that it wished to bring to the attention to the Delegate that would have been likely to have influenced his assessment on the value of the Community Poll. Indeed, Botany’s submission to the Minister of 28 June 2016 argued that the Community Poll should have been given more weight and that the Delegate’s approach was “an affront to the Community’s democratic right to express a view”. But the submission did not identify any significant factual error by the Delegate or refer to any particular factual issue it would have wished to address.

108. In SZBEL v The Minister for Immigration and Multicultural and Indigenous Affairs, [35] the High Court stated, in relation to proceedings before the Refugee Review Tribunal, that procedural fairness does not require the decision-maker to give an applicant a running commentary upon what it thinks about the evidence that is given. This comment applies, if anything with greater force, to the Delegate who was not the ultimate decision-maker in relation to the Minister’s proposal. Botany’s submission in this Court amounts to a contention that the Delegate should have informed Botany of his thinking on one issue among many that he had to consider in examining the Minister’s Proposal. Procedural fairness did not require the Delegate to take this course.

     35. [2006] HCA 63; 228 CLR 152 at [48].

Orders

109. I propose the following orders:

Refuse leave to the applicant to appeal on Grounds 10-12 and 14 in the draft Notice of Appeal.

Grant leave to the applicant to appeal from the decision of Garling J delivered 9 June 2016 on Grounds 1-9 and 13 in the draft Notice of Appeal.

Direct the applicant to file an Amended Notice of Appeal, limited to Grounds 1-9 and 13 in the draft Notice of Appeal, within 7 days.

Dismiss the appeal.

The applicant pay the respondent’s costs of the application for leave to appeal and of the appeal.

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Endnotes

Decision last updated: 02 September 2016