Canberra Services Club Ltd v Minister for Planning and Land Management; Australian Institute of Quantity Surveyors v Minister for Planning and Land Management
[2022] ACTSC 5
SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
Case Title: | Canberra Services Club Ltd v Minister for Planning and Land Management; Australian Institute of Quantity Surveyors v Minister for Planning and Land Management |
Citation: | [2022] ACTSC 5 |
Hearing Dates: | 20 August and 1 September 2020 |
DecisionDate: | 28 January 2022 |
Before: | McWilliam AJ |
Decision: | See [88] |
Catchwords: | JUDICIAL REVIEW – PROCEDURAL FAIRNESS – planning and development – concessional leases – where lease variations sought to remove concessional status in respect of three separate leases – whether decisions made by Minister that consideration of development applications was not in the public interest were affected by error of law – where Minister relied upon departmental advice not provided to the plaintiffs – whether practical injustice suffered |
Legislation Cited: | Administrative Decisions (Judicial Review) Act 1989 (ACT) ss 5, 17 Australian Capital Territory (Planning and Land Management) Act 1988 (Cth) s 10 Planning and Development Act 2007 (ACT) ss 54, 131A, 139, 162, 235A, 260, 260A, 261, 265 |
Cases Cited: | Applicant VEAL of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs [2005] HCA 72; 225 CLR 88 Baptist Community Services v ACT Planning and Land Authority & Ors [2015] ACTCA 3; 10 ACTLR 258 SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs [2006] HCA 63; 228 CLR 152 |
Texts Cited: | Justice David Mossop, The Constitution of the Australian Capital Territory (Federation Press, 2021) |
Parties: | SC 582 of 2019 Canberra Services Club Limited (ACN 008 390 896) ( Plaintiff) Minister for Planning and Land Management ( First Defendant) ACT Planning and Land Authority (Second Defendant) SC 587 of 2019 Australian Institute of Quantity Surveyors (ACN 008 485 209) (Plaintiff) Minister for Planning and Land Management (First Defendant) ACT Planning and Land Authority (Second Defendant) |
Representation: | Counsel C Erskine SC and R Arthur ( Plaintiffs) P Bindon ( Second Defendant) |
| Solicitors Bradley Allen Love Lawyers (Plaintiff (SC 582 of 2019)) Trinity Law ( Plaintiff (SC 587 of 2019)) ACT Government Solicitor ( Second Defendant) | |
File Numbers: | SC 582 of 2019 SC 587 of 2019 |
McWilliam AJ:
The plaintiffs before the Court, Canberra Services Club Limited (the Club) and the Australian Institute of Quantity Surveyors (the Institute), each lease land in the Territory. The land is held through a “concessional lease”, being a lease granted at a price less than full market value: see s 235A of the Planning and Development Act 2007 (ACT) (the PlanningAct). The primary purpose of such a lease is to encourage land use which would be to the economic or social benefit of the community in the Territory.
Each plaintiff lodged development applications which included provision for removal of the concessional status over the land leased by them. By three decisions made on 26 July 2019, the Minister for Planning and Land Management (the Minister) decided that it was not in the public interest for the Authority to consider the plaintiffs’ applications for development.
By automatic operation of the planning legislation (the detail of which is set out below), the consequence of the Minister’s decision was that the ACT Planning and Land Authority (the Authority) refused the applications for development.
Proceedings SC 582 of 2019 (brought by the Club) and SC 587 of 2019 (brought by the Institute) were commenced in November 2019, seeking judicial review of the decisions made by the Minister and the Authority, pursuant to s 5 of the Administrative Decisions Judicial Review Act 1989 (ACT) (the ADJR Act), or alternatively s 34B of the Supreme Court Act 1933 (ACT). The relief sought in each of proceedings includes declarations of invalidity and orders setting aside the decisions of the Minister and the Authority.
There are numerous grounds for the relief sought, set out in detail below as the issues for determination. The complaints traverse a denial of procedural fairness, misconstruction of statutory task, consideration of irrelevant matters, failure to take into account relevant considerations, inflexible application of a general policy, and unreasonableness. For the reasons that follow, I have found that the Minister’s decisions were unlawful and that in turn vitiates the Authority’s decisions.
The Land that is the subject of the dispute
An overview of the development in Canberra of the system for holding Crown leases may be found in The Constitution of the Australian Capital Territory, where Justice David Mossop (writing extra-judicially), has explained the interaction between the key Territory and Commonwealth planning instruments, respectively the “Territory Plan”, and the “National Capital Plan”: see 12-14, 169-172, and 181. A specific explanation of the concept of “Designated Areas” in the Territory is also included: 180.
It is not necessary to descend in any detail in explaining what is a somewhat complicated land management regime in order to understand the resolution of the issues in dispute here. It suffices to know as general context that land in the Territory is managed via a Crown lease system, subject to an overarching Territory Plan (Chapter 5 of the Planning Act), with some land in the Territory also being classed as “Designated Land”, which makes it also subject to a Commonwealth planning approval framework.
The leases
The Club holds a Crown lease for the following land:
(a)Block 1, Section 15, Griffith (the Griffith property)
(b)Block 25, Section 6, Barton (the Barton property)
An additional feature for the Barton property of significance to the present dispute was that it was located in a Designated Area, the boundaries of which are defined in the National Capital Plan pursuant to s 10(1) of the Australian Capital Territory (Planning and Land Management) Act 1988 (Cth) and paragraph 1.2 of the National Capital Plan (December 1990) (Cth). Accordingly, it was zoned “Designated Land”.
The Institute holds a Crown lease for two units in Deakin, ACT, being units 5 and 6 in Block 67, Section 35 Deakin (the Deakin Units).
The statutory framework dealing with concessional leases
In North Canberra Community Council v ACT Planning and Land Authority & Anor [2014] ACAT 47 (NCCC), the legislative development of the concessional lease scheme in the Territory was set out at [19]-[24], which I respectfully adopt, although again, only a general understanding is required as context to the decisions that are under challenge. A scheme for the grant of concessional leases has been in existence since the very beginning of the planning of Canberra. Recipients of a concessional lease will generally be “community organisations” (defined in the Dictionary to the Planning Act). The plaintiffs gave examples of not-for profit associations who may typically have been granted a concessional lease as including churches; associations to establish ethnic, social, cultural, and sporting clubs; and national associations, to establish national headquarters in designated parts of Canberra.
Because a concessional lease is granted at less than market value, the scheme will only achieve its purpose if concessional leases are not able to be sold or developed for a profit. To minimise the risk of abuse of the scheme, controls are imposed on concessional leases, including restrictions on: the use of the lease, who may hold such a lease, and dealing with the lease (only with the written consent of the Authority, pursuant to s 265 of the Planning Act).
As a result, if a holder of a concessional lease wants to develop the land for a use not permitted by the concessional status, or sell the land as a market lease, an application is required to remove the concessional status: ss 260 and 260A(1), located in Division 9.4.2 of the Planning Act, which carries the title “Varying concessional leases to remove concessional status”.
The development applications
The plaintiffs individually applied under s 260A(1) of the Planning Act to vary the respective leases to remove the concessional status.
The Club was the proponent of development application 201732582 in respect of the Griffith property, and Development Application 201732583 in respect of the Barton property. The Institute was the proponent of Development Application 201731633 in respect of the Deakin Units.
Development applications in the Territory may be assessed in one of three tracks: see s 54(3) of the Planning Act (code track, merit track and impact track). Applications which included a lease variation to remove a concessional lease status were dealt with under the merit track. For the Barton lease, the same requirement was imposed by s 131A(3) of the Planning Act.
The decisions under challenge
The decisions sought to be reviewed are as follows:
(a)In respect of the Griffith property:
(i)The Minister’s decision, made on 26 July 2019, with reasons published on 21 October 2019, that it was not in the public interest for the Authority to consider Development Application 201732582 (the Griffith decision); and
(ii)The Authority’s decision on 22 October 2019 to refuse Development Application 201732582 (the Griffith refusal).
(b)In respect of the Barton property:
(i)The Minister’s decision, made on 26 July 2019, with reasons published on 21 October 2019, that it was not in the public interest for the Authority to consider Development Application 201732583 (the Barton decision); and
(ii)The Authority’s decision, made on 22 October 2019, to refuse Development Application 201732583 (the Barton refusal).
(c)In respect of the Deakin Units:
(i)The Minister’s decision, made on 26 July 2019, and again with reasons published on 21 October 2019, that it was not in the public interest for the Authority to consider Development Application 201731633 (the Deakin decision); and
(ii)The Authority’s decision, made on 22 October 2019, to refuse Development Application 201731633 (the Deakin refusal).
The key statutory provisions for the decisions under challenge
The decisions were made pursuant to ss 162 (for the Authority) and 261 (for the Minister) of the Planning Act.
Section 261(1) of the Planning Act provides:
(1) The planning and land authority, or Minister, must not decide a development application to which this part applies under section 162 (Deciding development applications) unless the Minister decides whether it is in the public interest to consider the application.
Section 261(2) of the Planning Act then sets out the “considerations” the Minister must take into account in deciding whether the public interest favours a development application being considered. As it stood at the time the decisions were made, it is in the following terms:
(2) In deciding whether it is in the public interest to consider the development application, the Minister must consider the following:
(a) whether the Territory wishes to continue to monitor the use and operation of the lease by requiring consent before the lease is dealt with;
(b)whether approving the application would cause any disadvantage to the community, taking into account potential uses of the leased land that are consistent with the territory plan, whether or not those uses are authorised by the lease —
(c) whether the application to vary the lease to make it a market value lease is, or is likely to be, part of a larger development and, if so, what that development will involve;
(d) whether the Territory should buy back, or otherwise acquire, the lease;
(e) whether the Territory wishes to encourage the continued use of the land for an authorised use under the lease by retaining the concessional status of the lease;
Note The Minister must consider the material required under s 139(2)(p).
Sections 261(3) and 261(4) respectively require the Minister to give notice of any decision under s 261 to the Authority and provide that the decision itself is a notifiable instrument.
As will be seen below, the note at the end of s 261(2) has some relevance to the issues for determination. The note (again, as it stood in 2019) refers to s 139(2)(p) of the Planning Act. Section 139 deals with different items that must accompany a development application. Section 139(2)(p) is in the following terms:
(1) This section applies to an application for development approval.
(2) The application must—
…
(p) if division 9.4.2 (Varying concessional leases to remove concessional status) applies to the application—be accompanied by an assessment of—
(i) the social, cultural and economic impacts of the proposed variation; and
(ii) any other matter prescribed by regulation; …
NoteMatters the Minister must consider before approving a variation are set out in s 261, and conditions to which the variation may be subject are set out in s 262.
This section is the reason that each development application was accompanied by a Social Impact Assessment (SIA).
It is convenient to interpolate here a submission made by counsel for the Authority, to the effect that the note at the end of s 261(2) of the Planning Act was wrong. Although an application was required to include an SIA, the Minister was not obliged to consider the SIA per se. What the Minister was obliged to consider is a live issue for determination on the issues disputed before the Court in these proceedings. However, the correctness or otherwise of the note is said to be immaterial, as notes are not part of the statute: s 127(1) of the Legislation Act 2001 (ACT).
Turning next to the Authority’s refusals (following the Minister’s three decisions), each of the refusals was made exercising the power contained in s 162(3) of the Planning Act, which provides (emphasis added):
(3) Also, the planning and land authority or Minister must refuse a development application to which division 9.4.2 (Varying concessional leases to remove concessional status) applies if the Minister decides under section 261 that considering the application is not in the public interest.
From the express words of those sections, the Minister’s decision about whether it is in the public interest to even consider a development application is a statutory pre-condition for the Authority’s power to decide the said application. If the Minister decides that considering the application is not in the public interest, the Authority has no discretion – it must refuse the development application.
Alternatively, if the Minister considers the application is in the public interest, the process moves to whether the application should be approved, and an assessment of the merit of the application. For this reason, the plaintiffs described the Minister’s consideration under s 261(1) of the Planning Act as the first “threshold” stage in a two-step process to vary a concessional lease.
In the above statutory context, the Authority’s decision is entirely predicated on the Minister’s decision about the public interest. Accordingly, if the Minister’s decision is affected by legal error, that error will flow through to the Authority’s refusal of the development application. It is thus only necessary to engage with the issue of whether the Minister’s decisions were unlawful.
Notwithstanding the focus on the Minister’s decision, the Minister filed submitting appearances in each matter. The Minister’s decisions were actively defended by the Authority.
The Issues for determination
By Further Amended Originating Application filed on 1 September 2020, the Club and the Institute raise a number of grounds for review. For the purposes of these reasons, I have found it convenient to re-order and summarise them as follows:
(a)Ground 1: The Minister erred in denying the Club and the Institute procedural fairness or natural justice.
(i)The Minister took into account advice provided by the Environment, Planning and Sustainable Development Directorate (the EPSD Directorate) without giving the plaintiff an opportunity to consider and to respond to that advice.
(b)Ground 2: The Minister erred in law by asking whether it was in the public interest to approve the application, rather than whether it was in the public interest to consider the application.
(c)Ground 3(a): The Minister erred in failing to take relevant considerations into account, these being:
In respect of the Club’s development applications –
(i)Ongoing financial viability;
(ii)The capacity of existing planning and development controls to ensure continued appropriate use of the land in the event the concessional status of the lease was removed; and
(iii)The intended community use.
In respect of the Institute’s development application –
(i)The lack of representation opposing the development application, and in particular, the lack of any contention that there was a lack of office accommodation for non-profit organisations;
(ii)The capacity of existing planning and development controls to ensure continued appropriate use of the land in the event the concessional status of the lease was removed; and
(iii)The lack of demand in the area for office space for non-profit organisations.
(d)Ground 3(b): In addition, in respect of the Barton property, the Minister erred in taking an irrelevant consideration into account, namely:
(i)The Minister considered that the Territory will have no involvement in potential redevelopment outcomes if the lease is not concessional, the land being “designated land” under the National Capital Plan.
(e)Ground 4: The Minister erred in adopting a policy and applying it as a general requirement (that is, inflexible application of a policy), namely:
(i)Because existing community uses, or land on which there is a community use, must remain available for community use, the concessional status of the lease should not be removed, regardless of the particular circumstances of the plaintiff.
(f)Ground 5: In each case, the Minister’s decisions were so unreasonable that no reasonable person could have so exercised the power.
No ground was conceded by the Authority. Accordingly, each ground is in issue in these proceedings.
Ground 1: Procedural fairness
In relation to all three decisions, the Club and the Institute contend that the Minister denied them natural justice or procedural fairness. The complaint is that the Minister relied on advice from the EPSD Directorate without giving the proponents an opportunity to respond to it.
The Minister’s Reasons for the Barton decision
For each of the Barton, Griffith and Deakin decisions, the reasons provided by the Minister followed a similar pattern, that being to first set out what the decision was, then the legislative provisions under which it was made. The Minister then made “findings on material facts” and set out the reasons for the decision. Finally, the reasons recorded the materials relied upon for the findings of facts supporting the decision.
The substance of the Minister’s factual findings for the Barton decision is contained in the following four dot points (emphasis added):
· It is important for the Government to continue to monitor the community uses in the area to ensure the continued operation of community uses where they can be accessed by the community. Monitoring of the community uses is traditionally undertaken under section 265 of [the Planning Act]. Section 265 is the requirement for approval of the Authority to be obtained prior to dealing with the lease. Dealing with a lease includes assignment or transfer of the lease, subletting of the land comprised in the lease or part of it, or part with possession of the land comprised in the lease or any part of it. Market value leases do not often have the same requirement to obtain consent once any development requirements have been met.
· There is a potential disadvantage to the community should the leases be varied to include other uses and any possible redevelopment of the site. In particular, redevelopment of the site to maximum potential could limit community access to the site for future community utilisation of the land. The land is zoned designated land, and therefore approval for works is applied through Commonwealth government. The land could be redeveloped without consideration of the Territory interest in the land if the land is no longer concessional. The land use is determined by the National Capital Plan and works approval is granted by the National Capital Authority. The National Capital Plan land use policy for this parcel specifically permits the uses of bar, café, office, residential and restaurant. Therefore there is an increased likelihood that redevelopment may result in the loss of community facilities should the lease be varied.
· I considered possible redevelopment of the site and determined the use of the land with its existing use to be of benefit to the community as a whole. It was also identified that the Territory will have no involvement in potential redevelopment outcomes if the lease is not concessional as the works approval is undertaken by a Commonwealth government entity under Commonwealth policy. As a general principle, in some instances the development intentions of the lessee do require the lease to have the concession removed. It is important to preserve community land to ensure these services remain within reach for the use of the wider community. Although the intent in this case was not to redevelop the premises, but to enable consideration of the market sale or future of redevelopment of the land, it is important to preserve community land to ensure it remain[s] within reach for the use of the wider community.
… [the Minister then considered whether to buy back or acquire the lease]…
· There is a lack of community land in the area available for community and not for profit groups. It is important to maintain what community land is available, provide land for the community and encourage community groups to undertake community activities. This will ensure that community uses are scattered throughout the area and available for use by all members of the community.
The Minister’s reasons conclude:
· As a result of my directorate’s core business in the area of land supply, land release and direct sales of land, I am aware that there is a very limited number of blocks suitable for release for the use of community organisations.
· In my view, there was insufficient evidence to support the rationale to remove the concessional status as it would result in the further loss of community use land that is needed by the broader community.
As part of the “materials relied upon” in making the decision “for findings of facts”, the reasons expressly record the advice of the EPSD Directorate.
The EPSD Directorate advice concerning the Barton property
The advice of the EPSD Directorate was summarised in a schedule provided to the Court during the hearing by the Club and the Institute. In relation to the Barton property, the critical parts of the advice are contained in comments in an email from a senior policy officer in the EPSD, which was included as part of the briefing materials to the Minister. It states (emphasis added):
Strategic Context
· The ACT Planning Strategy (2018) commits the Government to “deliver social infrastructure that meets community needs and supports strong communities”.
· Ensuring every Canberran has good access to community facilities and opportunities for social interaction is a key feature of liveable, inclusive and resilient communities. Social Infrastructure encompasses all the facilities, services and networks that help families, groups and communities to meet their social, health, education, cultural and community needs.
· The land used for community uses and social infrastructure, particularly land with a concessional lease (i.e. less than market value) is becoming increasingly limited even while servicing a growing population.
· The Government is now looking to maximise the use of community land through its reforms to the current community direct sale process, and also the investigation of land under concessional lease to strategically determine future use of that land in order to harness the benefits of concessional community use land for the whole community.
· At the same time community land will become more important in a medium and higher density living environment where it is relied on because private open space is smaller and many social activities are undertaken outside the home.
General comments
· Consideration about the current number of other known concessional leases in the area should be given to ensure an appropriate balance of concessional land for various uses is maintained in the area (particularly beyond consideration of licensed gaming venues).
· While the application needs to be assessed on its own merits, consideration should also be given to the parallel development application, currently also being considered by Government to deconcessionalise the Club’s Griffith site.
Should both applications for deconcessionalisation be approved, two sites marked for concessional community use will be lost within the inner south.
Recommendation
· Support for application to deconcessionalise Crown lease, noting the above comments.
By comparing the emphasised parts of the advice with the emphasised parts of the Minister’s reasons, it is clear that the advice from the EPSD was material to the Minister’s decision.
The Minister’s Reasons for the Griffith decision
The Minister’s reasons for the Griffith decision repeat the paragraphs extracted above as to the importance of the Government having the ability to monitor the community uses in the area, the potential disadvantage to the community, the possible redevelopment of the site, and the lack of community land available.
There is an additional paragraph specifically dealing with the location of the Griffith property as follows:
· I also took into account the government’s significant investment in the Manuka Oval Precinct and its increasing importance as an international sporting precinct, along with the compatibility of any redevelopment of the site with the existing Manuka Oval Precinct and its surrounds; particularly the potential detrimental impact on tourism in this locality, through noise, light and security issues.
As with the Barton decision, later in the reasons, express reference was made to the advice of the EPSD Directorate being part of the materials upon which the Minister relied.
The EPSD Directorate advice regarding the Griffith property
Separate advice in relation to the Griffith property was provided by the EPSD Directorate to the Minister on 13 December 2018, which included advice from both the Strategic Planning and the Land Supply and Policy teams. The “strategic context” comments are identical to those contained in the advice given in relation to the Barton property. However, the advice differs somewhat in relation to the “General Comments” provided. Without setting out the detail in these reasons, the following comments specifically relate to the Griffith property:
· It is unclear from the supporting documentation submitted as part of the application, how deconcessionalising the Crown lease will enable the Canberra Services Club to “determine their financial viability for future development of the site” if they also propose to retain their current lease purpose clause.
· The further key reason cited for requiring the removal of the concessional status is stated as “essential to allow for future transfer, sublet or sale of the land”.
· These two claims (as above) seem contradictory. For instance, if the Club chooses to continue to operate on the site and build a new facility, they will still be able to apply to the [Authority] to sublet (with written consent of the Authority) the land (or their facilities), if the primary use is consistent with the current lease purpose clause, and aligns with their not for profit status.
A further comment related to the SIA submitted with the Club’s development application for the Griffith property (the Griffith SIA):
· While the [Griffith SIA] provided as part of the application states that “the removal of the concessional status…will not have an impact on the community and their ability to access community and social facilities…in the inner south suburb of Griffith”, the surrounding facilities and services referenced in the report are largely commercial in their operation (the majority of services listed in the [Griffith SIA] were also licensed club venues). As such, the community’s access to not for profit “lower order” community services has not been fully considered in the [Griffith SIA].
The recommendation made by the Land Supply and Policy team of the EPSD Directorate, which was summarised in the ministerial brief, was as follows:
· Maintaining the concessional status of the Crown lease is preferred, as there is not sufficient, nor clear enough evidence within the application to support the rationale to deconcessionalise, primarily because it would result in a further loss of community use land, which is a recognised need within the broader community.
The Minister’s Reasons for the Deakin decision
Again, the reasons in relation to the Deakin Units refer to the importance of the Government having the ability to monitor the community uses in the area, the potential disadvantage to the community, the possible redevelopment of the site, and the lack of community land available. A specific comment was made dealing with the lack of community land available as follows:
· In particular in this instance, I consider that some of the lower order not-for-profit uses could potentially benefit from the availability of the facilities offered by this type of premises. Often, the development intentions of the lessee do not require the lease to have the concessional status removed. Although the intent in this case was not to redevelop the premises, but to enable the market sale or sublease of the units, it is important to preserve community land to ensure these types of premises remain within reach for the use of the wider community. In particular, offices such as these which are available for the use of not-for-profit community organisation are diminishing and must be preserved.
Express reference was again made to the advice of the EPSD Directorate as part of the materials relied upon.
The Advice of the EPSD Directorate in relation to the Deakin Units
The advice provided by the Strategic Planning Division supported the proposed variation to remove the concessional status for the Deakin Units. The comments included comments that:
(a)the provisions of the Commercial CZ2 Business Zone and Deakin Precinct map and Code would provide adequate controls for any future uses and did not require ongoing monitoring by requiring consent before the lease was dealt with;
(b)approval of the application would not cause any disadvantage to the community as the proposed continued use of the site was consistent with the zoning provisions, precinct map and development code; and
(c)the application would enable the lessees to establish a sustainable business model.
The arguments of the parties
The following general principles were not in dispute:
(a)Procedural fairness must be moulded to the particular circumstances of the case: Applicant VEAL of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs [2005] HCA 72; 225 CLR 88 (VEAL) at [25]; Kioa v West (1985) 159 CLR 550 (Kioa) at 611-12 per Brennan J and 585 per Mason J.
(b)The nature and content of any procedural fairness obligations depend upon the statutory power involved: Kioa at 610.
(c)Where the exercise of the statutory power is capable of adversely affecting legally recognised rights or interests, it is presumed that the power carries with it an obligation to afford procedural fairness: CPCF v Minister for Immigration and Border Protection [2015] HCA 1; 255 CLR 514 at [367] per Gageler J, citing Plaintiff S10/2011 v Minister for Immigration and Citizenship [2012] HCA 31; 246 CLR 636 at [97].
(d)Such a presumption can only be displaced by “a clear, contrary legislative intention”: Kioa at 609; Minister for Immigration and Border Protection v WZARH [2015] HCA 40; 256 CLR 326 at [30] per Kiefel, Bell and Keane JJ. See also Mental Health Authority Australia Ltd v Registrar, ACT Long Service Leave Authority [2019] ACTSC 188; 344 FLR 413 (MHAA) at [10].
(e)Ordinarily, decision-makers must give persons likely to be affected by their decision an opportunity to address “credible, significant and relevant” information known to the decision-maker that is adverse to their interests, whether or not the decision-maker proposes to take it into account: VEAL at [17]; Kioa v West at 628 – 629 per Brennan J.
(f)In undertaking the assessment, the Court considers “what is required in order to ensure that the decision is made fairly in the circumstances having regard to the legal framework within which the decision is to be made”: Minister for Immigration and Border Protection v WZARH [2015] HCA 40; 256 CLR 326 at [30].
(g)If there was a breach of any obligation to afford procedural fairness, the Court must consider the consequences of that breach, again by reference to the statutory framework applicable to the decision, and common law principles. In order for relief to be granted to the person affected, it must be demonstrated that they have suffered a practical injustice. As stated in Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam [2003] HCA 6; 214 CLR 1 at 14 [37]:
Fairness is not an abstract concept. It is essentially practical. Whether one talks in terms of procedural fairness or natural justice, the concern of the law is to avoid practical injustice.
The parties agreed that the Planning Act does not displace the common law presumption that procedural fairness was required for each of the Minister’s decisions. Where they differed was in the content of the obligation, and whether that obligation was breached.
The Club and the Institute submitted that there was a general obligation on the Minister to identify to the person affected any issue critical to the decision which is not apparent from its nature or the terms of the statute under which it is made: see Commissioner for ACT Revenue v Alphaone Pty Ltd (1994) 49 FCR 576 at 591–2. The Minister was required to advise the plaintiffs of any potential adverse conclusion which would not obviously be open on the known material, and provide an opportunity for them to consider and respond to it.
The Authority did not take issue with the complaint that the Minister took into account advice from the EPSD Directorate. It also accepted that the advice was not given to the proponents at all. However, the Authority argued that the advice was generally favourable to the proponents in each case, in that it supported removal of the concessional status. As such, the Authority argued, there was no obligation on the Minister to provide the substance of the advice to the proponents.
The advice given by the Land Supply and Policy team concerning the Griffith property was not favourable as seen at [44] above. In respect of that advice, and as a further answer in each case, the Authority submitted that information relating to land availability in the Territory and specifically the shortage of “community land” which would be further reduced upon removal of the concessional status, is general information, and not information adverse to the Club or Institute itself.
The Authority’s argument was that because of the nature of that information, neither the Club nor the Institute could “realistically dispute or shed any light” upon the question of how many blocks are suitable for release, so that the proponents had not demonstrated a loss of any opportunity to put any information or argument to the Minister on the issue which would have made any meaningful difference to the Minister’s decision.
Consideration
Starting first with the nature of the right affected, the statutory framework for concessional leases operates so that the Minister’s views about what is in the public interest may conclusively determine the entire application. The initial “threshold” stage of the application may be (and in each of the present cases, was) the only opportunity given to a proponent to engage with the decision-maker about issues affecting the public interest.
Section 261(2) lists five matters which “must” be considered by the Minister when deciding whether it is in the public interest to consider the development application. They are the known issues. It is not expressly or impliedly an exhaustive list, and the Minister may consider other matters. However, this is not a case where the plaintiffs argued they did not know about an issue. This is a case where the advice provided to the Minister dealt with those mandatory considerations. It was plainly material that was credible, significant and relevant.
The position taken by the Authority was that the advice was not adverse to the proponents, and therefore did not have to be put to the proponents (at least insofar as it affected the Barton decision and the Deakin decision). I have set out what the EPSD Directorate advice contained in some detail above to demonstrate that such a submission is an oversimplification of the substance of the advice. While the overall recommendation of the EPSD Directorate was to vary the concessional status, there were a number of concerns raised about the scarcity of “community land” and the consequences if two applications to “deconcessionalise” were approved. Parts of the advice were adverse to the interests of the proponents. The ultimate recommendation was not the only relevant information known to the Minister.
Applying the accepted principles derived from the authorities as set out above, the Minister was obliged to give the proponents an opportunity to comment on what had been said by the EPSD Directorate. In relation to the Griffith decision, the advice of the EPSD Directorate was clearly adverse and the same conclusion follows.
It is appreciated that the method by which part of the advice was given was by internal emails within the directorate, and this may be a more efficient means of feeding information up the chain to the decision-makers. There may also be confidentiality concerns. However, there was nothing preventing the Minister from communicating the substance of the information to the proponents, if the Minister formed the view that it was not appropriate to provide the original source documents.
The Authority relied on the fact that the information was general information, rather than information specific to the Club or the Institute, as somehow excusing the need for the Minister to put it to the proponents. Having regard to the statutory framework here, and the lack of any provision dealing with the content of material to be given to an applicant, such reliance is misplaced. General information may be adverse to a specific application, as it was in respect of each of the three decisions challenged here.
That segues into the second limb of the Authority’s argument, about whether the nature of the information meant that nothing the proponents might have said would have made any meaningful difference to the Minister’s decision, which was refined during argument as being directed to the proponents suffering no practical injustice. The Authority argued that practically, the plaintiffs had been given a fair opportunity to put their case on the rationale for varying the concessional status notwithstanding the lack of “community land”. They had devoted an entire section to the rationale for varying the lease status in each SIA. If they did not “put their best foot forward” on making the case, that was not a failing by the Minister.
The submissions made by the Authority misunderstand that procedural fairness is directed to the process, not the conclusion: Re Refugee Review Tribunal; Ex parte Aala [2000] HCA 57; 204 CLR 82 at [59]; SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs [2006] HCA 63; 228 CLR 152 at [25].
The discretionary consideration to grant relief was articulated in Steadv State Government Insurance Commission [1986] HCA 54; 161 CLR 141 at 147. The test is not whether the outcome would have ultimately been the same had procedural fairness been afforded, but whether anything could have been said. The consideration is directed to the possibility of a different outcome, not the probability.
It is not to the point that the proponents had addressed the broad issue to some extent in the SIAs submitted with the application. What the Club and Institute lost was the opportunity to make representations about the specific advice that had been given to the Minister. The proponents may not have been able to change the fact that “community land”, so described, was increasingly scarce and that two applications together had the potential to impact particularly on one area in that regard, but they may have meaningfully contributed to the Minister’s consideration about how such facts ought to be treated in the context of the particular applications.
The plaintiffs described the matters in s 261(2) as being of the kind considered in Baptist Community Services v ACT Planning and Land Authority & Ors [2015] ACTCA 3; 10 ACTLR 258 at [59]: that is, they are not matters which must be met by the proponent. Rather, they are matters which must be taken into account by the Minister. Importantly, this means that it is open to the Minister to take into account other relevant factors. It also means that the Minister could decide that it is in the public interest to consider an application even if one of the five matters under s 261(2) has not been met. Alternatively, the Minister could decide that considering the application is not in the public interest even if all of the matters have been met.
That something was said by the plaintiffs in each SIA about the rationale behind seeking a lease variation does not mean that there was no practical injustice. The discretion given to the Minister involves the weighing of different considerations. Knowing that the Minister’s own Directorate raised as an issue scarcity of land with concessional status and the impact of two lease variations in the same area may alter the attention given to those considerations in addressing public interest, including whether further expert reports were obtained to address notions of demand for the type of land under consideration.
In that regard, there was expert evidence before the Court about what further material could have been provided to the Minister as part of addressing the Minister’s concerns, and there were more technical matters the proponents indicated they would have liked an opportunity to address. For example, the introduction of the term “community land”, what that term meant and how land that did not have concessional status could nevertheless remain community land in the future (through conditions of approval).
Taking those matters into account, it cannot be said that the Club and the Institute have suffered no practical injustice. The Barton decision, the Griffith decision and the Deakin decision have each been affected by a denial of procedural fairness and should be set aside.
Ground 2: Did the Minister misconstrue the task required by s 261(1)?
In light of the above reasons, it is unnecessary to address the remaining grounds. However, because the development applications will again be before the Minister and the Authority for consideration following the resolution of these proceedings, it may help to briefly deal with the issue raised concerning the Minister’s task under s 261(1).
The plaintiffs submitted that the Minister’s reasons reveal an erroneous approach to s 261 of the Planning Act. The statute required the Minister merely to determine, as a threshold question, whether it was in the public interest to consider an application to vary the concessional status on its merits. The Minister was not required to determine whether it was in the public interest to remove the concessional status of each lease.
Instead, the task for the Minister was to assess whether there was a “compelling public interest” stopping any consideration (by the decision-maker, being the Authority or the Minister) of an application to vary such status, relying on discussion to that effect in NCCC at [25]-[26].
Comparing the statutory task with the Minister’s reasons for each decision, the plaintiffs contended that what the Minister said about each of the mandatory considerations was directed more to the ultimate consideration of the application by the Authority, rather than the precise and different question of the public interest in the Authority undertaking the assessment exercise at all.
The Authority’s written submissions did not squarely address the argument, as it was mistakenly thought that the plaintiffs did not press the issue. The point was also somewhat lost in oral argument, due to the way the submissions unfolded for the Authority, which specifically focused on how the Minister considered each of the mandatory criteria for consideration, rather than the Minister’s overarching approach to the task.
However, it must be uncontroversial from the express words of s 261 of the Planning Act that the plaintiffs’ argument as to what is involved in the statutory task is correct, insofar as the language requires the Minister to consider whether it is in the public interest for the Authority to consider the application to vary the concessional status. It is not necessary to go further than those words, lest they be seen as a gloss on the actual words used in the section. Putting the task as one of considering whether there is a “compelling” public interest preventing any consideration is but one example of where the Minister may prevent further progress of an application to which Division 9.4.2 applies.
There is also force in the plaintiffs’ argument that the Minister mistakenly diverged from that statutory task. As seen by the reasons set out at [35] above, the Minister found “there was insufficient evidence to support the rationale to remove the concessional status”. That is a finding about the overall merit of removing the concessional status, not a finding about whether it was in the public interest to consider that question.
Similarly, the various advice given by the EPSD Directorate discussed in Ground 1 above was arguably framed with a view to assisting the Minister to make a decision whether to approve an application to remove the concessional status of each lease, rather than assisting with whether it was against the public interest for the Authority to even consider such an application.
The Minister appears to have reasoned that if ultimately it was not in the public interest to approve a lease variation to remove concessional status, then it was not in the public interest for the Authority to undertake any consideration of the application. However, in assessing merit as the means of arriving at a conclusion for a specific and much more limited statutory question, what the Minister appears to have done is in fact step into the decision-making shoes of the Authority with regard to the lease variation itself. While the Minister has power to so act (under s 158 of the Planning Act for applications that are not in the Code track, noting that all concessional lease variation applications must proceed on the Merit track), there are statutory requirements for calling in the power, and they were not complied with here.
One significant consequence arising from conflating the two statutory tasks is that a decision under s 261 of the Planning Act does not permit the Minister to impose any conditions on any subsequent approval, whereas a decision under s 162 permits a decision-maker to grant a conditional approval. As the plaintiffs submitted, allowing the applications to proceed to be considered would have permitted the Authority considering whether the imposition of conditions could be used to address concerns directed to the public interest. That opportunity was lost on the approach taken by the Minister.
It must be acknowledged that the statutory framework did not assist the Minister in differentiating between the public interest in considering an application to vary the concessional status of a lease as against the public interest in approving such an application.
Contrary to the submissions of the Authority (see [22] and [24] above), in my view, notwithstanding that the SIA is not listed among the mandatory considerations set out in s 261(2) of the Planning Act, the statutory framework does require the Minister to take account of the SIA. As set out above, s 139(2)(p) of the Planning Act requires that where the application is or includes removal of the concessional status of a lease, an SIA (which assesses the social, cultural and economic impacts of the proposed variation) must accompany the application.
The evident purpose to be achieved by such a requirement is first to ensure that the social, cultural and economic impact of the change has been properly considered and assessed by a proponent, and secondly to assist the decision-maker in considering the same question.
To construe the provisions of the Planning Act as requiring a proponent to prepare and provide an SIA for the application specifically addressing public interest considerations, but not also requiring the Minister to consider it would not further the purpose of the provisions. For that reason, the Authority’s construction is not to be preferred.
The difficulty, though, is that the contents of the SIA assess in detail the impact of the lease variation proposed. It is properly considered as part of a merit assessment. It may be that the real intention behind s 261 of the Planning Act was that in cases where a development application seeks to remove the concessional status of a concessional lease, a pre-condition to any approval of such an application (by the Authority or the Minister) was the Minister’s satisfaction that such variation was in the public interest. If that was the objective of s 261, one might well appreciate why the Minister would need the SIA before forming a view about whether it was in the public interest to vary the lease status. But that is not how the section is presently drafted.
For those reasons, had it been necessary to do so, I would have also found that the Minister erred in the approach to the statutory task in relation to each of the three development applications the subject of these proceedings.
Grounds 3 and 4
Ground 3 relates to the Minister’s treatment of relevant and irrelevant considerations. Ground 4 relates to a complaint about the application of a general policy without regard to the specific circumstances of the applications. Given that I have found there was a denial of procedural fairness and that the statutory task was misconstrued, how the matters raised by the plaintiffs are considered may well change in any future decision by the Minister. Accordingly, it is appropriate to refrain from any discussion of their substance.
Ground 5: Unreasonableness
In light of the above reasoning in relation to Grounds 1 and 2 above, it is unnecessary to consider this ground.
Conclusion and Orders
Legal error has been established in relation to each of the Minister’s decisions. Section 17 of the ADJR Act empowers the Court to grant declaratory relief, but the remedy is discretionary. Given the public nature of the decision, the flow on consequences of established error for the decisions of the Authority, that the controversy is not hypothetical, and that no argument was made against that type of remedy being granted if error was established, it is appropriate to make the declarations sought, along with consequential orders setting aside the decisions of the Minister and the Authority.
As each plaintiff has succeeded on the application, it is also appropriate to make orders for costs, again on a discretionary basis but applying the principle that costs follow the event. The liability for such costs ought to rest with the Authority, being the active defendant in the proceedings.
The orders of the Court are as follows:
In proceedings SC 582 of 2019:
(1) The Court declares that the following decisions are invalid:
(a) The decision of the Minister for Planning and Land Management made on 26 July 2019 in relation to Development Application 201732582 (Griffith Public Interest Decision);
(b) The decision of the Minister for Planning and Land Management made on 26 July 2019 in relation to Development Application 201732583 (Barton Public Interest Decision);
(c) The decision of the ACT Planning & Land Authority (Authority) made on 22 October 2019 in relation to Development Application 201732582 (Griffith Refusal); and
(d) The decision of the ACT Planning & Land Authority (Authority) made on 22 October 2019 in relation to Development Application 201732583 (Barton Refusal).
(2) The Griffith Public Interest Decision, the Barton Public Interest Decision, the Griffith Refusal and the Barton Refusal are each set aside.
(3) The Authority is to pay the plaintiff’s costs of the proceeding.
In proceedings SC 587 of 2019:
(4) The Court declares that the following decisions are invalid:
(a) The decision of the Minister for Planning and Land Management made on 26 July 2019 in relation to Development Application 201731633 (Deakin Public Interest Decision); and
(b) The decision of the ACT Planning & Land Authority (Authority) made on 22 October 2019 in relation to Development Application 201731633 (Deakin Refusal).
(5) The Deakin Public Interest Decision and the Deakin Refusal are each set aside.
(6) The Authority is to pay the costs of the plaintiff in each proceeding.
| I certify that the preceding eighty-eight [88] numbered paragraphs are a true copy of the Reasons for Judgment of her Honour Associate Justice McWilliam. Associate: Aislinn Grimley Date: 28 January 2022 |
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