Brunswick Valley Sports Association Inc v Byron Shire Council
[2006] NSWLEC 71
•02/09/2006
Land and Environment Court
of New South Wales
CITATION: Brunswick Valley Sports Association Inc v Byron Shire Council [2006] NSWLEC 71 PARTIES: APPLICANT
RESPONDENT
Brunswick Valley Sports Association Inc
Byron Shire CouncilFILE NUMBER(S): 41169 of 2005 CORAM: Jagot J KEY ISSUES: Interlocutory Relief :- Sale of community land
Statutory trust
Serious question to be tried
Balance of convenienceLEGISLATION CITED: Environmental Planning and Assessment Act 1979 s 93E, s 94, s 123, s 124
Environmental Planning and Assessment (Amendment Development Contributions) Act 2005
Local Government Act 1993 s 30, s 45, s 674
National Parks and Wildlife Act 1974
Real Property Act 1900 s 74JCASES CITED: Bathurst City Council v PWC Properties Pty Limited (1998) 195 CLR 566;
Beecham Group Limited v Bristol Laboratories Pty Limited (1968) 118 CLR 618;
Castlemaine Tooheys Limited & Others v The State of South Australia (1986) 161 CLR 148;
Engadine Area Traffic Action Group Inc v Sutherland Shire Council (2004) 134 LGERA 75;
Frevcourt Pty Ltd v Wingecarribee Shire Council (2005) 139 LGERA 140;
Jarasius v Forestry Commission of New South Wales (1989) 69 LGRA 156;
Oshlack v Iron Gates Pty Ltd [1996] NSWLEC 186;
Patrick Stevedores Operations No 2 Proprietary Limited and Others v Maritime Union of Australia and Others (1999) 195 CLR 1;
Ross v State Rail Authority of New South Wales (1987) 70 LGRA 91DATES OF HEARING: 07/02/2005
DATE OF JUDGMENT:
02/09/2006LEGAL REPRESENTATIVES: APPLICANT
G Bassett
SOLICITORS
Sarvaas Ciappara LawyersRESPONDENT
K Gerathy (Solicitor)
SOLICITORS
Abbott Tout
JUDGMENT:
THE LAND AND
ENVIRONMENT COURT
OF NEW SOUTH WALESJagot J
9 February 2006
41169 of 2005
BRUNSWICK VALLEY SPORTS ASSOCIATION INC
ApplicantJUDGMENTBYRON SHIRE COUNCIL
Respondent
1. By notice of motion filed on 27 January 2006 and heard on 7 February 2006 the applicant seeks an interlocutory injunction in the following terms:
- 1 The respondent be restrained from selling the community land at lot 107 Ocean Shores before the final determination of the court in the proceeding.
2 An order that the applicant’s costs of, and incidental to this application for interlocutory relief be borne by the respondent. In the alternative, costs of, and incidental to this application for interlocutory relief to be costs in the cause.
2. The proceeding referred to in para 1 of the notice of motion is a class 4 application filed on 6 October 2005 in which the applicant seeks the following declarations and orders:
- 1 A declaration that Byron Shire Council under s 36 of the Local Government Act 1993 categorise the community land at Lot 107, Shara Boulevarde, Ocean Shores in DP 856767 (“Lot 107”) as a sportsground.
2 A declaration that for Byron Shire Council to dispose of Lot 107 pursuant to s 45(4) of the Local Government Act would be a breach of statutory trust under s 94 of the Environmental Planning and Assessment Act 1979.
3 An order that Byron Shire Council be permanently restrained from selling Lot 107.
4 An order that Byron Shire Council expend monetary contributions it holds in trust for Lot 107 within a reasonable time for provision of sporting facilities.
5 Costs of, and incidental to this application.
3. The class 4 application also sought, by way of interlocutory relief, an order as follows:
- An order that lot 107 not be sold to any entity until the proceedings are determined.
4. The applicant did not ultimately pursue the interlocutory relief as specified in the class 4 application but, on 27 January 2006, filed the notice of motion referred to in paragraph 1 above.
5. The land in question is lot 107 DP856767 at Ocean Shores. It is land owned by the Council and is community land under the Local Government Act 1993. The applicant is an incorporated association. The applicant holds the view that the land is suitable for sports fields. It does not wish to see the land sold by Byron Shire Council (“the Council”), presumably because the effect of sale will be to prevent the use of the land which the applicant perceives as desirable and, indeed, necessary to meet the needs of the local community.
6. The foundations for the applicant’s claim are ss 123 and 124 of the Environmental Planning and Assessment Act 1979 (“the EPA Act”) and s 674 of the Local Government Act 1993. These sections provide in part:
- Environmental Planning and Assessment Act 1979
123 Restraint etc of breaches of this Act
(1) Any person may bring proceedings in the Court for an order to remedy or restrain a breach of this Act, whether or not any right of that person has been or may be infringed by or as a consequence of that breach.
(2) Proceedings under this section may be brought by a person on his or her own behalf or on behalf of himself or herself and on behalf of other persons (with their consent), or a body corporate or unincorporated (with the consent of its committee or other controlling or governing body), having like or common interests in those proceedings.
…
124 Orders of the Court
(1) Where the Court is satisfied that a breach of this Act has been committed or that a breach of this Act will, unless restrained by order of the Court, be committed, it may make such order as it thinks fit to remedy or restrain the breach.
…
Local Government Act 1993
674 Remedy or restraint of breaches of this Act—other persons
(1) Any person may bring proceedings in the Land and Environment Court for an order to remedy or restrain a breach of this Act.
(2) The proceedings may be brought by a person on the person’s own behalf or on behalf of the person and on behalf of other persons (with their consent), or a body corporate or unincorporated (with the consent of its committee or other controlling or governing body), having like or common interests in those proceedings.
…
7. A principal breach alleged by the applicant is that specified in para 2 of the class 4 application, namely, that for the Council to dispose of the land pursuant to s 45(4) of the Local Government Act 1993 involves “a breach of statutory trust under s 94” of the EPA Act and (presumably) a breach of s 45(1) of the Local Government Act 1993 which prohibits certain dealings with community land.
8. This allegation is founded primarily on pleadings in paras 3, 7, 8 and 9 of the applicant’s points of claim filed on 25 October 2005. These paragraphs are in the following terms:
- 3 Lot 107 DP 856767 is classified community land categorized for sportsgrounds.
7 Community land is subject to restrictions affecting sale, disposal, leasing and licensing to which operational land is not.
8 Lot 107 was purchased in 1996 by Council with funds partly from Section 94 contributions under the Environmental Planning and Assessment Act 1979 NSW.
9 Council holds Lot 107 on a statutory trust for the public purpose of the provision of sportsgrounds.
9. In its amended points of defence the Council admits that the land in question is classified as community land under the Local Government Act 1993, but does not admit that the land has been “categorised for sports grounds”. The Council denies that the land was purchased with funds partly from s 94 contributions levied under the EPA Act and contends as follows:
- 8 In answer to paragraph 8 of the points of claim, the respondent says that on 9 July 1996 it entered into a contract for the purchase of Lot 107 from Greenfields Constructions Pty Limited for the sum of $167,500.00 and subsequently completed the purchase on 12 July 1996 using funds from the Council’s general fund but otherwise denies paragraph [8] of the Points of Claim.
10. Section 94 of the EPA Act was recently amended by Act 19 of 2005, the Environmental Planning and Assessment (Amendment Development Contributions) Act 2005. Prior to its amendment, the relevant provisions of s 94 were as follows:
- 94 Payment towards provision or improvement of amenities or services
- (1) Subject to subsection (2), if a consent authority is satisfied that a development, the subject of a development application or of an application for a complying development certificate, will or is likely to require the provision of or increase the demand for public amenities and public services within the area, the consent authority may grant consent to that application subject to a condition requiring:
- (a) the dedication of land free of cost, or
(b) the payment of a monetary contribution,
or both.
(3) Subject to subsection (4), if:
- (a) a consent authority has, at any time, whether before or after the date of commencement of this Part, provided public amenities or public services within the area in preparation for or to facilitate the carrying out of development in the area, and
(b) development, the subject of a development application or of an application for a complying development certificate, will, if carried out, benefit from the provision of those public amenities or public services,
- the consent authority may grant consent to the application subject to a condition requiring the payment of a monetary contribution towards recoupment of the cost of providing the public amenities or public services.
(5) The consent authority may accept:
- (a) the dedication of land in part or full satisfaction of a condition imposed in accordance with subsection (3), or
(b) the provision of a material public benefit (other than the dedication of land or the payment of a monetary contribution) in part or full satisfaction of a condition imposed in accordance with subsection (1) or (3).
(7) The consent authority is to apply any monetary contribution paid in accordance with a condition referred to in subsection (3), if the whole or any part of the cost incurred in providing the public amenities or public services with respect to which the contribution is paid remains unpaid, towards repayment of that cost.
(8) Land dedicated in accordance with a condition imposed under subsection (1) or in part or full satisfaction of a condition imposed under subsection (3) is to be made available by the consent authority for the purpose of providing public amenities or public services or both within a reasonable time.
(9) If a consent authority proposes to impose a condition in accordance with subsection (1) or (3) in respect of development, the consent authority must take into consideration any land or other sum of money that the applicant has elsewhere dedicated free of cost within the area or previously paid to the consent authority other than as a condition of the grant of consent under this Act.
(10) If:
- (a) a condition imposed under subsection (1) or (3) in relation to development the subject of a development application has been complied with, and
(b) a public authority would, but for this subsection, be entitled under any other Act to require, in relation to or in connection with that development, a dedication of land or payment of money in respect of the provision of public amenities or public services or both,
- then, notwithstanding that other Act, compliance with the condition referred to in paragraph (a) is taken to have satisfied the requirement referred to in paragraph (b) to the extent of the value (determined, if the regulations so provide, in accordance with the regulations) of the land dedicated or the amount of money paid in compliance with the condition.
(12) A condition of a kind allowed by a contributions plan may be disallowed or amended by the Court on appeal because it is unreasonable, even if it was determined in accordance with the plan.
(13) …
11. The current provisions of the EPA Act include the following:
- 93E Provisions relating to money etc contributed under this Division
(1) A consent authority or planning authority is to hold any monetary contribution or levy that is paid under this Division in accordance with the conditions of a development consent or with a planning agreement for the purpose for which the payment was required, and apply the money towards that purpose within a reasonable time.
(2) However, money paid under this Division for different purposes in accordance with the conditions of development consents may be pooled and applied progressively for those purposes, subject to the requirements of any relevant contributions plan or ministerial direction under this Division.
(3) Land dedicated in accordance with this Division is to be made available by the consent authority or planning authority for the purpose for which the dedication was required and within a reasonable time.
(4) A reference in this section to a monetary contribution or levy includes a reference to any additional amount earned from its investment.
…
94 Contribution towards provision or improvement of amenities or services
(1) If a consent authority is satisfied that development for which development consent is sought will or is likely to require the provision of or increase the demand for public amenities and public services within the area, the consent authority may grant the development consent subject to a condition requiring:
- (a) the dedication of land free of cost, or
(b) the payment of a monetary contribution,
- or both.
(3) If:
- (a) a consent authority has, at any time, whether before or after the date of commencement of this Part, provided public amenities or public services within the area in preparation for or to facilitate the carrying out of development in the area, and
(b) development for which development consent is sought will, if carried out, benefit from the provision of those public amenities or public services,
- the consent authority may grant the development consent subject to a condition requiring the payment of a monetary contribution towards recoupment of the cost of providing the public amenities or public services (being the cost as indexed in accordance with the regulations).
(5) The consent authority may accept:
- (a) the dedication of land in part or full satisfaction of a condition imposed in accordance with subsection (3), or
(b) the provision of a material public benefit (other than the dedication of land or the payment of a monetary contribution) in part or full satisfaction of a condition imposed in accordance with subsection (1) or (3).
- (a) a benefit provided as a condition of the grant of development consent under this Act, or
(b) a benefit excluded from consideration under section 93F (6).
- (a) a condition imposed under subsection (1) or (3) in relation to development has been complied with, and
(b) a public authority would, but for this subsection, be entitled under any other Act to require, in relation to or in connection with that development, a dedication of land or payment of money in respect of the provision of public amenities or public services or both,
- then, despite that other Act, compliance with the condition referred to in paragraph (a) is taken to have satisfied the requirement referred to in paragraph (b) to the extent of the value (determined, if the regulations so provide, in accordance with the regulations) of the land dedicated or the amount of money paid in compliance with the condition.
12. The parties did not address the Court on the consequences of the 2005 amendments, if any, for the applicant’s claims.
13. The applicant’s case, as I understand it, is that the land (having been acquired in part by funds paid pursuant to conditions imposed under s 94 of the EPA Act) is impressed with a form of trust which prevents the Council from selling the land in reliance on s 45(4) of the Local Government Act.
14. Section 45 of the Local Government Act provides as follows:
- 45 What dealings can a council have in community land?
(1) A council has no power to sell, exchange or otherwise dispose of community land.
(2) A council may grant a lease or licence of community land, but only in accordance with this Division.
(3) A council may grant any other estate in community land to the extent permitted by this Division or under the provisions of another Act.
- Note. The word estate has a wide meaning. See the Interpretation Act 1987 , section 21 (1).
15. The Council contends that the sale is authorised by s 45(4) of the Act in that the sale is for the purpose of enabling the land to be added to the adjoining nature reserve dedicated under the National Parks and Wildlife Act 1974. The Council refers in particular to the terms of its resolution dated 7 October 2005, para 4 of which states:
- That in the event that agreement is reached with the RTA, that the sale be conditional upon transfer of the land to the NPWS for inclusion in the adjoining Nature Reserve.
16. The Council points to the letter of 20 January 2006 from the National Parks and Wildlife Service to the Council which refers to the nature reserve and a letter dated 23 January 2006 from the RTA to the Council which refers to “acquisition of land for compensatory habitat lot 107 DP856767 at Ocean Shores”.
17. It is common ground that the land is community land under the Local Government Act 1993. I am satisfied on the evidence that the Council intends to sell the land to the RTA in apparent reliance on s 45(4) of the Local Government Act 1993. Whether that section is available to be relied upon by the Council is a central issue of fact and law in the proceedings. It is neither necessary nor appropriate that I attempt to resolve the facts or the law relating to the application of s 45(4) on this application. The immediacy of the Council’s intention to sell the land is relevant to the present application, but is not readily apparent from the evidence. I turn now to that issue.
18. Ms Westing, the general manager of the Council, swore an affidavit in the proceedings which at para 16 refers to the Council and the RTA having agreed upon the sale of the land “subject to contract” for a sale price of $250,000. This agreement is said to have been reached on 25 January 2006. Ms Westing also states that the grant of an interlocutory injunction would prevent the Council from acting upon its acceptance of the RTA’s offer, which offer may then be withdrawn, and that the RTA is the “only prospective purchaser of lot 107”. There is also evidence, which I accept, that the Council made application for the lapse of a caveat which the applicant had registered on the title to the land pursuant to s 74J of the Real Property Act 1900.
19. Against these factors relevant to any inference I might draw as to the immediacy of the Council’s intention to sell the land, are that negotiations with the RTA must have been on foot since some time prior to October 2005, as the date of the Council’s resolution to sell the land is 7 October 2005. Further, the offer and acceptance are expressed by Ms Westing to be “subject to contract”.
20. I requested that the Council’s legal representative obtain instructions on the steps which the Council intends to take with respect to the sale of the land and, importantly, the timing of those steps. Unfortunately, the Council’s legal representative was unable to obtain clear instructions on that issue. This is unfortunate because the Court expects that a party in the position of the Council, a public authority, will ensure that its legal representatives are able to disclose fully to the Court all circumstances relevant to an application such as the present. The proposed timing of any sale of the land to the RTA is plainly relevant to the immediacy of the threat of breach relied upon by the applicant.
21. Absent the Council stating to the contrary, I can only infer, and do infer, that the Council intends to deal with the land by way of sale, possibly in the near future. This inference is supported by the evidence to which I have referred in paragraph 18 and by other correspondence, in particular, a letter dated 14 October 2005 from the Council to the applicant. That letter discloses that the Council was unwilling to give any undertaking not to sell the land whilst the proceedings were on foot. That communication remains consistent with the Council’s current position.
22. The applicant contends that the land is categorised as “sports fields” under the Local Government Act 1993. The Council disputes this contention. Whether this is so or not must await resolution in the final hearing. It is relevant (as the Council submits) that the categorisation of the land, as opposed to its classification as community land, is not expressly referred to in s 45(4) as a condition upon the availability of the exemption from the prohibition on sale in s 45(1).
23. The primary factual dispute for present purposes is that the applicant says that the land was acquired using, in part at least, funds paid to the Council pursuant to conditions imposed on development consents under s 94 of the EPA Act. This is a fact fundamental to the applicant’s claimed relief. The Council denies that the land was acquired with s 94 funds.
24. The evidence relied upon by the applicant in relation to this issue is ambiguous to say the least. This may in part be explained by the fact deposed to by Mr Ogston that copies of documents produced by the Council had not been made available to the applicant. The evidence before the Court relevant to this important factual matter appears to be limited to the following:
- (1) The s 94 contributions plan made in 1993, which the Council submitted and the applicant apparently did not dispute, does not refer to the land.
(2) A report to the Council’s Finance, Works and Enterprise Committee meeting, dated 20 November 2005, which refers to an “Ocean Shores land purchase from future s 94 funds”.
(3) Council documents relating to the acquisition of the land, then part of lot 111, that refer to a demand for sporting fields in Ocean Shores and state that “funding is available for purchase of active open space land within s 94 funds”.
(4) Mr Bolger’s affidavit, which refers to payment being made for the land from the general fund and subsequent payments into that fund from the Council’s s 94 fund. In this regard, the Council acknowledged that the two funds were not necessarily distinct, the transfers being book entries.
(5) Possibly, the extract from the Council’s property register, which refers to usage as “considered for sports fields” and to two plans of management.
(6) Possibly, the evidence from Mr Ogston relating to the Council’s dealings with the land prior to its proposed sale (including various plans of management).
25. For the purpose of these interlocutory proceedings, I am prepared to assume that the land was in part purchased by application of s 94 funds.
26. The applicable principles for the grant of an interlocutory injunction are set out in the judgment of Mason ACJ in Castlemaine Tooheys Limited & Others v The State of South Australia (1986) 161 CLR 148 at 153-154 as follows:
- The principles governing the grant or refusal of interlocutory injunctions in private law litigation have been applied in public law cases, including constitutional cases, notwithstanding that different factors arise for consideration. In order to secure such an injunction the plaintiff must show: (1) that there is a serious question to be tried or that the plaintiff has made out a prima facie case, in the sense that if the evidence remains as it is there is a probability that at the trial of the action the plaintiff will be held entitled to relief; (2) that he will suffer irreparable injury for which damages will not be an adequate compensation unless an injunction is granted; and (3) that the balance of convenience favours the granting of an injunction.
Recently two members of this Court have held that the plaintiff must establish that there is "a serious question to be tried", to use the expression favoured in American Cyanamid v. Ethicon Ltd. (1975) AC 396, at p407, in preference to the "prima facie case" test which was adopted in Beecham Group Ltd. v. Bristol Laboratories Pty. Ltd. (1968) 118 CLR 618, at p 622 (Australian Coarse Grain Pool Pty. Ltd. v. Barley Marketing Board of Queensland (1982) 57 ALJR 425; 46 ALR 398 (Gibbs C.J.); Tableland Peanuts Pty. Ltd. v. Peanut Marketing Board (1984) 58 ALJR 283, at p 284; 52 ALR 651, at p 653 (Brennan J.)). In my opinion that is the correct test to be applied at least in the majority of cases - see Mason J., "Declarations, Injunctions and Constructive Trusts" (1980) 11 University of Queensland Law Journal 121, at p.128; but cf. Administrative & Clerical Officers Association v. The Commonwealth (1979) 53 ALJR 588; 26 ALR 497. However, it may be that in some cases where the public interest would be adversely affected by the grant of an injunction the plaintiff may need to show a probability, even a distinct probability of success, in order to obtain an interlocutory injunction. The degree of likelihood of success in the action is a factor that is related to the balance of convenience in a way shortly to be mentioned.
27. Those principles require consideration of three questions.
- (1) Is there a serious question to be tried?
(2) Will the applicant suffer irreparable damage unless the injunction is granted?
(3) Does the balance of convenience favour the granting or withholding of the injunction?
28. The Council submits that the applicant’s claim failed on each of the three questions. I deal with each consideration below.
29. The Council submits that the public interest would be adversely affected by the grant of an interlocutory injunction. Accordingly, the Council submits that identifying a triable issue, which is neither vexatious nor frivolous, should be insufficient to persuade me that there is a serious question to be tried. The Council submits that a higher threshold is appropriate, namely, that the applicant must establish a probability of success on the final hearing (by which I understand the Council to mean that I must be satisfied that it is “more likely than not” that the applicant would succeed on the final hearing). To support this submission, the Council relies on the final two sentences quoted above from Castlemaine Tooheys, a decision of Bignold J in Jarasius v Forestry Commission of New South Wales (1989) 69 LGRA 156 at 161-162 and of Talbot J in Oshlack v Iron Gates Pty Ltd [1996] NSWLEC 186 (11 July 1996). For the reasons I now give, I am not persuaded to accept that submission.
30. The observations of Mason ACJ in Castlemaine Tooheys must be read in context. His Honour leaves open the possibility that in certain classes of case something more than the raising of a serious question may be required. Although the Council perceives the sale of the land to be in the public interest (particularly given that the apparent purpose of the sale is for the land to be added to an existing nature reserve), the public interest is a multi-faceted concept. There is also an over-riding public interest in ensuring compliance with the law, including statutory requirements for dealings with land held by councils as public land and community land.
31. In Jarasius, Bignold J dealt with the relative strength of the applicant’s case as a part of the balance of convenience and otherwise accepted that there was a serious question to be tried. In Oshlack, Talbot J’s observations were made in the context of the potential relevance of the absence of an undertaking as to damages (a factor which may also be relevant in this case given the disparity between the sale price of $250,000 and the undertaking offered in the amount of $5,000).
32. Insofar as the small sum offered by the applicant as its undertaking for damages is relevant to this issue, in Ross v State Rail Authority of New South Wales (1987) 70 LGRA 91 at 100, Cripps J referred to the concepts of both “a strong prima facie case” and a “good arguable case”. In this case, the undertaking as to damages proffered by the applicant in the amount of $5,000 is very low when considered in the context of the sale price of the land of $250,000. I do not see this issue as affecting whether or not there is a serious question to be tried. In my opinion, it is appropriate to deal with this issue in considering the balance of convenience.
33. Moreover, the meaning of a “probability” of success is not fixed. Even if a probability of success was the test to be applied, then the degree of probability required may vary depending upon the nature of the rights an applicant asserts and the practical consequences likely to flow from the orders sought (see, for example, Beecham Group Limited v Bristol Laboratories Pty Limited (1968) 118 CLR 618 at 622).
34. The weight of current authority undoubtedly supports that the relevant test is whether there is a serious question to be tried (see, for example, Patrick Stevedores Operations No 2 Proprietary Limited and Others v Maritime Union of Australia and Others (1999) 195 CLR 1 at 24).
35. The Council’s arguments do not persuade me that this is an appropriate case to require more than the raising of a serious question to be tried. It follows from the above that I do not accept the Council’s submission to the effect that the applicant must establish a “probability” of success on the final hearing in order to obtain an interlocutory injunction.
36. Even on the “serious question to be tried” criterion, I understand the Council to submit that there is no such question for the following reasons:
- (1) There is no evidence from which any inference could be drawn that the land was partly acquired by s 94 funds. I have addressed this factual issue above.
(2) The applicant has not pointed to any statutory or other obligation which would attach to the land.
(3) The availability of s 45(4), an exception to s 45(1), is not conditioned upon the land being in any particular category of community land.
(4) The substantive relief sought in the class 4 application is in part misconceived.
37. The applicant has not drawn to my attention any statutory provision, proposition of law or authority to support the contention that land, if acquired (in part or whole) by application of monetary contributions under s 94, cannot thereafter be dealt with by a council, including by way of sale or transfer. Moreover, the obligations now in s 93E(1) of the EPA Act and its predecessor provision (s 94(6)), prima facie, appear to relate to the application of the monetary contributions themselves. There was also no evidence before the Court, such as any development consent, disclosing that conditions had been imposed pursuant to s 94, requiring contributions to be paid for any particular purpose.
38. The applicant did refer to the decision of the Court of Appeal in Frevcourt Pty Ltd v Wingecarribee Shire Council (2005) 139 LGERA 140. The questions in issue in that case do not appear directly to coincide with the questions in this case. The applicant also referred to the decision of the High Court in Bathurst City Council v PWC Properties Pty Limited (1998) 195 CLR 566. Again, it is difficult to ascertain a direct coincidence between the relevant facts and issues in PWC Properties and the present case. Reference was made by the Council to the decision of Lloyd J in Engadine Area Traffic Action Group Inc v Sutherland Shire Council (2004) 134 LGERA 75 (a matter related to unexpended funds which had been levied pursuant to s 94 and a claim for repayment).
39. Despite the possibility that the applicant’s argument may not have arisen for consideration previously, PWC Properties recognises the potential for a form of statutory trust to arise in certain circumstances, being a trust for statutory purposes which “bound the land and controlled what would otherwise have been the freedom of disposition enjoyed by the registered proprietor of an estate in fee simple”.
40. The disputes about the inferences which ought to be drawn from the evidence as to the source of funding for the acquisition of the land, and the potentially difficult questions of law relating to the interaction between the development contribution scheme under the EPA Act and chapter 6 of the Local Government Act, do not lead me to the conclusion that the applicant has no real prospect of success at trial. In these circumstances, I am prepared to conclude that the applicant’s claim for relief does raise a serious question to be tried. The strength of that claim is best dealt with by reference to the third consideration, the balance of convenience.
41. The Council contends that the nature of the relief sought in the class 4 application means that there will be no irreparable injury to the applicant if the injunction is not granted. I understand this to mean that the Council contends that orders are sought (reference was made to paras 1, 3 and 4 of the class 4 application) which would not be made by the Court and that s 45(4) (a section in issue in these proceedings) and s 30 of the Local Government Act 1993 provide a mechanism for sale of the land irrespective of the applicant’s claims.
42. The Council’s concerns in respect of aspects of the relief sought in the class 4 application are legitimate. For example, I do not understand the basis for an order permanently restraining sale of the land in the face of s 30 of the Local Government Act 1993.
43. Nevertheless, the essence of the applicant’s claim, as I understand it, is that sale of the land by the Council will place the land permanently outside the control of the Council and thus will remove any possibility of enforcing the alleged obligations to categorise the land as sports field and to make the land available for that purpose. If those claims are ultimately found to have substance, then the applicant may be exposed to irreparable damage for which damages will not be an adequate remedy, if the injunction is not granted.
44. The qualification I have placed on this conclusion emphasises the importance of the question of the strength of the applicant’s case, which I will address as part of the balance of convenience.
45. The applicant submits that the balance of convenience favours the grant of the injunction. It submits that:
- (1) The injunction will not prevent negotiation of the sale of the land, only actual sale.
(2) If the land is sold, there will be no incentive for the Council to provide another site for a sports field.
(3) The Council owns no other land suitable for a sports field.
(4) There is no evidence of any commitment by the RTA to sell the land to the National Parks and Wildlife Service.
(5) The Council has expended public moneys, said to be s 94 funds, on assessing the most appropriate use of the land over some years.
46. It is implicit in the first of these submissions that the applicant’s position also reflects that to which I have referred above, namely, that sale will presumably alienate the land and place it beyond the Council’s control for use as a sports field in an area where the evidence (namely extracts from the Council’s s 94 contribution plan) points to rapid population growth and, the applicant submits, the land is required to meet the needs of the local community.
47. The Council answers each of the above submissions as follows (adopting the same numbering as in paragraph 45).
- (1) The RTA is the only potential buyer of the land and there is a risk of the bargain being lost altogether which will subject the Council to financial harm. For the purposes of this application, I accept that there is such a risk for the reasons expanded upon below.
(2) There is no evidence with respect to the provision of a sports field one way or another. I accept that the evidence of the applicant on this issue is tenuous.
(3) There is no evidence that other suitable land is not available for use as a sports field. I accept that the evidence of the applicant on this issue is also tenuous.
(4) There is evidence of the commitment to ensure that the land is made part of the nature reserve. The Council’s 7 October 2005 resolution requires that result as a condition of any contract for sale. In addition there is the evidence of the letter from the National Parks and Wildlife Service of 20 January 2006 and the RTA correspondence referring to the acquisition of land for compensatory habitat, being letters dated 28 November 2005 and 23 January 2006. I accept that evidence for the purposes of this application.
(5) There is no evidence of the expenditure of any s 94 funds in connection with the land. I have stated above that I am prepared to assume to the contrary for the purpose of this application.
48. The Council submits that there are factors present which weigh heavily against the grant of an interlocutory injunction. In particular, the Council relies on the risk of harm to the Council by reason of loss of the sale and the unavailability of another purchaser. The applicant disputes any such risk having regard to the terms of the RTA’s letter dated 23 January 2006 and the applicant’s contention that the Council has been negotiating with the RTA, according to the applicant, since 1999. The last contention is difficult to see on the evidence. In any event, I am satisfied on the evidence that this risk, identified by the Council’s general manager, cannot be dismissed as mere speculation or as “fanciful” as the applicant submits. Although the actual position of the RTA is not known, on the evidence, I accept that the risk of loss of the sale is real and must be considered in the balance with other factors.
49. The Council points to the fact that it has determined that the land ought to be incorporated as part of the nature reserve due to its ecological values. This factor, however, appears to me possibly to be more relevant to the question of final relief. I do not place weight on it on the interlocutory application.
50. The Council emphasises the delay by the applicant in seeking interlocutory relief. Delay is a relevant factor. The Council refers to the evidence that similar relief was sought in proceedings commenced by the same applicant in June 2004, albeit in a class 1 application, which proceedings were discontinued. Further, interlocutory relief was sought in the class 4 application as filed on 6 October 2005 in respect of which Cowdroy J made directions on 7 October 2005 for service of evidence and the hearing of the interlocutory application on 18 October 2005. The applicant, however, did not press for interlocutory relief at that time.
51. In response to the Council’s submissions on delay, the applicant refers to (i) the applicant’s apparent assumption that the Council would not sell the land pending the determination of these proceedings, (ii) the motion to rescind the resolution for sale, which was not dealt with by the Council until 24 January 2006, and (iii) the protection the applicant otherwise had from the caveat until 3 February 2006, when the caveat lapsed. Hence, the applicant submits that circumstances had changed necessitating the application for interlocutory relief. The Council, for its part, points to correspondence sent by its solicitors to the applicant on 14 October 2005 making it plain that the Council did not and would not give any undertakings to refrain from dealing with the land.
52. I accept that there has been very significant delay on the part of the applicant in seeking interlocutory relief. The delay is not fully explained by the matters to which the applicant has referred. The delay has placed the Council in the position of being at some risk of losing the sale at a time when the fact of sale and the sale price have been agreed. Had a more timely application been made by the applicant, the potential harm to the Council could well have been avoided. The fact that the applicant sought similar relief in proceedings in June 2004 and in these proceedings in October 2005, but did not ultimately press either claim until the filing of this motion on 27 January 2006, is a factor which, in my view, weighs heavily against the applicant on this motion.
53. The Council points also to the inadequacy of the undertaking as to damages which is limited to $5,000. The Council’s concerns about that inadequacy are well founded. The absence of an adequate undertaking as to damages is a relevant factor. The applicant is an incorporated association seeking to vindicate public law as the applicant perceives it. While the absence of an adequate undertaking might otherwise materially weigh in the balance against the grant of interlocutory relief, particularly when considered in the context of the applicant’s delay and the strength of the applicant’s case to which I will now turn, I do not place significant weight on that consideration for present purposes.
54. I have indicated above that there appear to be difficulties with aspects of the relief sought by the applicant in the class 4 application. Further, in its points of claim, its evidence on the motion and its written and oral submissions on the motion, the applicant did not inform me of a clear basis for the allegation of breach of the EPA Act and of s 45(1) of the Local Government Act, having regard to the terms of s 45(4). Hence, as this matter presently stands, I am unable to conclude that the applicant’s case is a strong one. This conclusion also weighs in the balance against the grant of interlocutory relief.
55. The Council’s refusal to provide an undertaking not to deal with the land pending determination of the proceedings seems to me to be a neutral factor in this case.
56. The lack of information concerning the precise timing of the actions of the Council is of concern as I have indicated. I have set out above the inferences I draw about the nature of this threat and its immediacy.
57. The position of the RTA, and the degree to which its interests might be affected by any interlocutory order, is not known to the Court. The RTA may have an interest in the subject matter of the litigation such as to make it a necessary or appropriate party to the proceedings. I have not been addressed on that question, but it is a matter which the parties will have to determine prior to final hearing.
58. In my opinion, the balance of convenience in the circumstances of this matter clearly is in favour of withholding the injunction. I thus decline to grant the interlocutory relief claimed by the applicant. For these reasons, the applicant’s claim for interlocutory relief is refused. The dismissal of the notice of motion which must follow does not preclude the applicant from making any further application should circumstances change or if the applicant is able to establish a stronger case, at least on an interlocutory basis.
59. I am satisfied that the proceedings ought to be expedited and orders made to facilitate the final hearing and the making of any further application by the applicant should circumstances alter as referred to above.
60. Subject to any matters which the parties wish to put to the contrary as to the form of orders I propose the following:
- (1) The applicant’s notice of motion for interlocutory relief, filed 27 January 2006, is dismissed.
(2) The costs of the applicant’s notice of motion, filed 27 January 2006, are reserved.
(3) Exhibits A, B and C are returned.
(4) The proceedings are granted expedition.
(5) The respondent is to notify in writing the RTA forthwith of the existence of the proceedings and the orders made today.
(6) The respondent is to notify the applicant in writing of any proposed dealing by the respondent with lot 107 DP856767 being a dealing affecting title to that land at least three days prior to the dealing occurring.
(7) Both parties have liberty to restore the matter on twenty four hours’ notice.
(8) The proceedings be listed for mention before the Registrar on a date which I will discuss with the parties for the purpose of obtaining an expedited final hearing.
61. Finally, it is appropriate that directions now be made for the conduct of the matter on an expedited basis.
62. The formal orders of the court are as follows:
- (1) The applicant’s notice of motion for interlocutory relief, filed 27 January 2006, is dismissed.
(2) The costs of the applicant’s notice of motion, filed 27 January 2006, are reserved.
(3) Exhibits A, B and C are returned.
(4) The proceedings are granted expedition.
(5) The respondent is to notify in writing the RTA forthwith of the existence of the proceedings and the orders made today.
(6) The respondent is to notify the applicant in writing of any proposed dealing by the respondent with lot 107 DP856767 being a dealing in any way affecting title to the land (including entry into any contract for sale) at least three business days prior to that dealing being entered into by the respondent.
(7) Both parties have liberty to restore the matter on 24 hours notice.
(8) The proceedings are listed for mention before the Registrar today for the purpose of obtaining an expedited final hearing.
63. The Court makes the following directions:
- (1) The applicant is to file and serve amended class 4 application and amended points of claim by 16 February 2006.
(2) The applicant is to identify to the respondent the further documents sought by way of discovery by 16 February 2006.
(3) The applicant is to file and serve all affidavits in chief, and affidavits in reply to the respondent’s evidence filed thus far, by 23 February 2006.
(4) The respondent is to provide access to discovered documents by 2 March 2006.
(5) The respondent is to file and serve its points of defence to any amended points of claim, and affidavits on which it relies, by 16 March 2006.
(6) The applicant is to file and serve any affidavits in reply by 23 March 2006.
(7) The parties are to file and serve a written outline of submissions by 30 March 2006.
(8) Objections to affidavits are to be notified at least seven days prior to the hearing.
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