Commonwealth of Australia v Randwick City Council

[2001] NSWLEC 34

Land and Environment Court

of New South Wales

CITATION:	Commonwealth of Australia v Randwick City Council [2001] NSWLEC 34
PARTIES:	APPLICANT: Commonwealth of Australia RESPONDENT: Randwick City Council
FILE NUMBER(S):	10072 of 2000; 10073 of 2000; 40041 of 2000
CORAM:	Talbot J
KEY ISSUES:	Jurisdiction :- conflict between state and federal law Practice & Procedure :- application for stay of merits hearing pending determination of jurisdictional issue
LEGISLATION CITED:	Commonwealth Constitution s 109 Commonwealth Places (Application of Laws) Act 1970 (Cth) Environmental Planning and Assessment Act 1979 Environment Protection and Biodiversity Conservation Act 1999 (Cth) Environment Protection (Impact of Proposals) Act 1974 (Cth) Judiciary Act 1903 (Cth) s 78B
CASES CITED:	Allders International Pty Ltd v Commissioner of State Revenue (Vic) (1996) 186 CLR 630; Attorney-General (NSW) & Others v Stocks and Holdings (Constructors) Pty Ltd (1970) 124 CLR 262; Botany Municipal Council v Federal Airports Corporation (1992) 175 CLR 453; 79 LGERA 241; Commonwealth of Australia v Randwick City Council (2000) 108 LGERA 373; Helman v Byron Shire Council (1995) 87 LGERA 349; Howard Silvers Investments Pty Ltd v Sydney City Council & Anor (1998) 99 LGERA 154; R v Phillips (1970) 125 CLR 93; Re Residential Tenancies Tribunal of New South Wales and Henderson and Another: Ex parte The Defence Housing Authority (1997) 190 CLR 410; Worthing v Rowell and Muston Pty Ltd & Others (1970) 123 CLR 89
DATES OF HEARING:	26/02/2001, 27/02/2001, 28/02/2001
EX TEMPORE JUDGMENT DATE :	02/28/2001
LEGAL REPRESENTATIVES:	APPLICANT: Mr T S Hale SC with Mr M Wright (Barrister) SOLICITORS: Minter Ellison RESPONDENT: Mr W R Davison SC with Mr D R Parry (Barrister) SOLICITORS: Bowen and Gerathy

JUDGMENT:

IN THE LAND AND Matter Nos. 10072-3 of 2000
ENVIRONMENT COURT And: 40041 of 2000
OF NEW SOUTH WALES Coram: Talbot J
Decision Date: 28 February, 2001


Commonwealth of Australia
Applicant

v
Randwick City Council

Respondent

REASONS FOR JUDGMENT ON LEAVE TO RELY ON NOTICES OF MOTION


1. On 20 February 2001 in the course of opening on behalf of the Commonwealth, the applicant in these class 1 proceedings, Mr Hale SC asserted that works comprising, inter alia, the decontamination of land held for defence purposes at Randwick, the filling and draining of that land and the initial subdivision thereof are steps in the development process “governed by the Environment Protection (Impact of Proposals) Act 1974 (Cth)” . He said that the Commonwealth legislation prevails by virtue of “various legislation and s 109 of the Constitution over the New South Wales legislation”.

2. Earlier, on 19 February, Mr Hale made the following statement:-

Now the Commonwealth legislation applies to this land in its present ownership, the state legislation does not but the clear intention of course is to develop this land to sell this land to third parties who when they purchase the land will be subject to the state legislation and indeed at that point the land will be subject to the state legislation. Therefore, it is relevant from our point of view to obtain development consent for the completed subdivision so that it can be marketed to third parties at a later time. We however at all times are subject to the Commonwealth legislation, not only in relation to what we’ve described as the Commonwealth works but also the physical construction of the subdivision itself. It is for obvious commercial reasons that we need development consent so that when we sell to the third parties the land that they acquire is land which has the requisite development consent under the state legislation.

3. By way of further clarification, on 20 February Mr Hale went on as follows:-

However, as I indicated yesterday, given that the purpose for this development application is the realisation of Commonwealth land and therefore a sale of Commonwealth land. It is a fundamental commercial requirement that at the point of sale that each of these lots is in a state which enables their use by prospective purchasers. If all of this was done pursuant to Commonwealth legislation and we sought to sell that land, Mr Smith or Mrs Brown who purchased it, when they sought to live in those residences would immediately find themselves in difficulty because they would be seeking to use the land and use a building where development consent had not been granted for it. It is for that reason that the Commonwealth, for those commercial reasons, needs to obtain a development consent. The Commonwealth like any developer is entitled to describe for itself the development application that it lodges and we’ve seen that in Ligon and other cases.


4. The general scheme the Commonwealth has adopted for the purpose of obtaining what it regards as the necessary approvals for the development of surplus land at Randwick is more particularly explained in the earlier judgment which I delivered in this matter on 16 June 2000 ( Commonwealth of Australia v Randwick City Council (2000) 108 LGERA 373).

5. The position taken by the Commonwealth through its counsel during the opening caused the council to file a notice of motion seeking that the hearing of these proceedings be stayed until questions of jurisdiction raised in class 4 proceedings already on foot but yet to be listed for hearing are determined. The class 4 proceedings, as presently constituted, seek declarations and orders that the preliminary Commonwealth Works are subject to control by the Environmental Planning and Assessment Act 1979 (NSW) (“the EP&A Act”). The council, as the applicant in the class 4 proceedings, has now filed a notice of motion seeking to amend the class 4 application to include relief by way of a declaration and orders clarifying whether the subject development is controlled by the New South Wales legislation to the exclusion of the Commonwealth legislation or vice versa.

6. The applicant opposes the Court allowing the council to rely on the notices of motion on the ground that the council has failed to identify with precision the matters upon which it relies and in particular the matter arising under the Constitution or involving its interpretation which requires an identification of the two legislative provisions said to be inconsistent.

7. Further, as a discretionary matter, the applicant claims the Court would not grant a stay because:-

(a) of the weakness of the Council’s contention;
(b) of the unexplained delay in bringing the application in the first week of the hearing; and
(c) the prejudice to the application of stay of proceedings.


8. It is not now in dispute between the parties that the question of jurisdiction can be resolved as an issue in class 1 proceedings ( Helman v Byron Shire Council and Another (1995) 87 LGERA 349).

9. At the conclusion of submissions Mr Davison SC foreshadowed an amendment to the proposed notice of motion in the class 1 proceedings whereby instead of seeking a stay the council would seek an order which would have the effect of summary dismissal of the proceedings on the ground that the Court had no jurisdiction to entertain an appeal as the EP&A Act had no application to the subject development.

10. Mr Davison subsequently withdrew the prospect of an amended notice of motion and confirmed that the council was seeking only that the class 1 proceedings be stayed until the question of jurisdiction had been determined either in these proceedings or in the class 4 proceedings.

11. Both parties accept that if there is a real issue that the EP&A Act as a law of the State of New South Wales is inconsistent with a law of the Commonwealth within the meaning of s 109 of the Constitution then s 78B of the Judiciary Act 1903 imposes a duty on the Court not to proceed with hearing the matter unless and until the Court is satisfied that notice of the cause, specifying the nature of the matter has been given to the Attorneys-General of the Commonwealth and of the States and a reasonable time has elapsed since the giving of the notice for consideration by the Attorneys-General of the question of intervention in the proceedings or removal of the cause to the High Court.

12. Pursuant to s 78B(2) the Court may continue to hear evidence and argument concerning matters severable from any matter arising under the Constitution or involving its interpretation.

The argument raised by council

13. On the earlier application for a stay of the proceedings the council relied on the assumption that NSW law applied to the subject proceedings regardless of the outcome to the class 4 proceedings. Mr Davison says that assumption was displaced by what was said by Mr Hale in the course of the opening of the merits appeal as set out above.

14. Furthermore, on 9 March 2000 the Minister for Defence notified the Minister for the Environment and Heritage that in accordance with the Environment Protection (Impact of Proposals) Act 1974 (“the EPIP Act”) the Commonwealth Department of Defence was designated as the proponent of the following proposed actions within the Defence Land at Randwick:-

1. Remediation of contaminated land and buildings by removal and/or treatment of contaminating substances.
2. Clearing and removal of vegetation.
3. Demolition and removal of buildings and other improvements.
4. Earthworks, re-contouring of the site and landscaping.
5. Construction of a sporting oval and related sporting facilities and stormwater drainage facilities. The sporting oval is also intended to operate as a stormwater detention basin.
6. Construction of a building of approximately 850 square metres in area and construction of related courtyards, terraces and circulation area of approximately 2,150 square metres. The building and related areas are intended to be used as a community facilities centre.


15. By Notice of Intention prepared in July 2000 the Minister for Defence provided a preliminary assessment of the environmental impacts of the proposed actions (the Commonwealth Works) as required under the EPIP Act. By letter dated 19 December 2000 the Assistant Secretary of the Environmental Assessment Branch of the Department of the Environment and Heritage notified the Defence Estate Organisation that in accordance with par 3.1.1(a) of the Administrative Procedures under the EPIP Act it had been determined that neither an environmental impact statement nor a public environment report is required for the purpose of achieving the objects of the Act in relation to the proposal.

16. Although the EPIP Act was repealed on 16 July 2000 when the Environment Protection and Biodiversity Conservation Act 1999 (“the EPBC Act”) commenced, the council notes that the object of the EPIP Act was to ensure, to the greatest extent that is practicable, that matters affecting the environment to a significant extent are fully examined and taken into account in and in relation to, inter alia, the formulation of proposals and the carrying out of works and other projects by or on behalf of the Australian government.

17. Administrative Procedure Orders made under s 6(1) of the EPIP Act require that the Minister who is responsible for a proposed action must consider whether an action that is proposed to be taken was an action for which a proponent should be designated. If the action Minister is satisfied that the action is an environmentally significant action then the Minister must designate an appropriate person or department as the proponent of the proposed action.

18. The Court has been told that the action Minister did not designate an appropriate person for the development the subject of these proceedings which otherwise the Minister would have been obliged to do. Relying on the assumption that the Minister acted regularly and complied with the relevant obligations in making the decision not to designate an appropriate person pursuant to the Administrative Procedures Orders, the council suggests that the provisions of the EPIP Act were applied to the development and thus have the effect of excluding the EP&A Act provisions as being invalid within the meaning of s 109 of the Constitution.

19. On the other hand, the Commonwealth says that following the repeal of the EPIP Act the EPBC Act applies in respect of the subject development. Section 10 of that Act provides as follows:-

This Act is not intended to exclude or limit the concurrent operation of any law of a State or Territory, except so far as the contrary intention appears.


20. The council’s case will be that the application of the EPBC Act 1999 does not arise in respect of the subject works because the action required under the EPIP Act was complete before that Act came into force.

21. The Court has the benefit of an outline of the complex argument that could be involved in relation to the jurisdiction question. It is not necessary nor indeed is it appropriate to resolve this issue at this point in the proceedings.

22. The question which presently arises for determination is whether the council should be given leave to rely on the notice of motion and if so, whether the proceedings should be stayed until the issue of jurisdiction has been resolved.

23. The council relies on the explanation of the effect of s 52(i) of the Commonwealth Constitution in Allders International Pty Ltd v Commissioner of State Revenue (Vic) (1996) 186 CLR 630 at 638, 645, 667 and 670. The High Court also noted that following the earlier decisions in Worthing v Rowell and Muston Pty Ltd & Others (1970) 123 CLR 89; Attorney-General (NSW) & Others v Stocks and Holdings (Constructors) Pty Ltd (1970) 124 CLR 262 and R v Phillips (1970) 125 CLR 93 the Commonwealth Places (Application of Laws) Act 1970 (“the Commonwealth Places Act”) was passed. Subsection (1) of s 4 of that Act applies the law of a State whether in force before or after the commencement to Commonwealth Places within the state.

24. The council’s position is that either the state law (not being inconsistent with the Federal law) applies to all the works required to prepare the land for sale or the Federal law applies because it is a comprehensive code ( Botany Municipal Council v Federal Airports Corporation (1992) 79 LGERA 241 at 252; 175 CLR 453), there being an inferred intention to cover the field or there is an indirect inconsistency where the two environmental Acts deal with the same subject matter.

25. On the earlier stay application the assumption was that NSW law applied to the subject proceedings regardless of the outcome of the class 4 proceedings. The council now says that assumption was displaced by what was said in opening on the second day of this hearing and confirmed by a closer examination of the material provided to the Minister for Environment.

26. The council makes a two fold proposition:-


(1) The proceedings should be stayed as a direct consequence of the application of s 78B of the Judiciary Act.

(2) There will be significant waste of cost and time occasioned by an ultimate finding that there is no jurisdiction.


The response by the Commonwealth

27. Primarily the Commonwealth argues that the propositions outlined by the council are largely unsupported by evidence and rely on broad assertions made from the bar table.

28. Originally it was contended by the Commonwealth that as the notice of motion in the class 1 proceedings did not directly raise a jurisdictional question the class 1 proceedings should not be stayed to enable class 4 proceedings to determine whether the class 1 proceedings are within jurisdiction. It is now clear that the council proposes to raise the issue of jurisdiction in the hearing of these class 1 proceedings and the problems that arose in Howard Silvers Investments Pty Ltd v Sydney City Council and Another (1998) 99 LGERA 154 do not arise.

29. Apart from the weakness of the council’s contention, the Commonwealth says that the unexplained delay in bringing the application in the first week of the hearing and the prejudice of a stay to the applicant would persuade the Court to exercise its discretion by dismissing the notice of motion.

30. Mr Hale asserts that the council’s approach to the relationship between relevant state and Commonwealth legislation is misconceived. He claims that there can be no dispute that in relation to the Commonwealth Works the applicant was required to comply with the EPIP Act and that in fact it has done so. The issue in the class 4 proceedings is that in addition to compliance with the Commonwealth legislation the applicant, in carrying out the Commonwealth Works, must comply with the EP&A Act. Whether there is any inconsistency between the EPIP Act and the EP&A Act is a question of construction of the relevant Commonwealth and State legislation to determine whether there is any relevant s 109 consistency. According to the Commonwealth this is not a constitutional question.

31. Furthermore, the Commonwealth legislative framework has changed. When the EPBC Act commenced on 16 July 2000 the carrying out of the subject works in the class 1 proceedings was governed by that Act. Section 10 provides for concurrent operation of any law of a State.

32. Thus, according to the Commonwealth if it is to carry out the subject works it will be required to comply with both the EPBC Act and the EP&A Act.

33. Accordingly, the applicant’s position will be that the Commonwealth Works do not require development consent by virtue of the fact that the Works fall to be considered under the EPIP Act (pursuant to transitional provisions) and they fall within the exception to the Commonwealth Places Act in s 4.

34. A question therefore is whether the EP&A Act falls within the exceptions in s 4(2)(a) of the Commonwealth Places Act. This leads to an examination of both pieces of legislation. If it is found that the Commonwealth Act covers the field then there is inconsistency (Botany Municipal Council v Federal Airports Corporation) . However, the real comparison is now between the EPBC Act and the EP&A Act. The Commonwealth asserts that if it does not propose to carry out the works itself then the EPBC Act can have no application. In this respect Mr Hale argues that the council has made no endeavour to identify the relevant inconsistency between the state and federal legislation. The issue is now in respect of an entirely different legislative regime to that when the Commonwealth Works were considered. If that argument is accepted then the Commonwealth will contend that at present there is no identified matter arising under the Constitution or involving its interpretation which can be the subject of a notice pursuant to s 78B of the Judiciary Act. Before such a direction can be made the reasons for the alleged invalidity of state legislation must be identified.

35. Although not entirely resiling from the gist of the statements made to the Court in opening and set out above, Mr Hale now says they were intended merely as an explanation of the scope of the Commonwealth Works.

36. The Commonwealth contends that by submitting a development application it is seeking the benefit of a development consent and must therefore comply with the requirements of the EP&A Act as any other applicant is required to do (Re Residential Tenancies Tribunal of New South Wales and Henderson and Another; Ex parte The Defence Housing Authority (1997) 190 CLR 410 at 427). The making of a development application pursuant to the EP&A Act is no cause for inconsistency with the EPBC Act because both pieces of legislation are capable of being complied with.

Whether leave should be granted

37. At this point of the argument the Court is not able to discern whether there is a matter arising under the Constitution or involving its interpretation. For the moment it can be said that the Court is not persuaded one way or the other. It would therefore be premature to grant a stay of the proceedings in order to accommodate the procedure outlined in s 78B of the Judiciary Act. The Court is not satisfied that the point the council now raises has not always been open to it. The statements made by Mr Hale in opening merely alerted the council to the prospect of an arguable proposition.

38. The Court is conscious of the extent of preparation undertaken by the parties in respect of the merit issues. Many directions hearings and an issues conference have taken place. Various experts have been directed to confer and to prepare joint statements in respect of their evidence pursuant to the Expert Witness Practice Direction 1999. The Court understands that this process is almost complete. A significant part of the costs in proceedings such as these is incurred in the course of preparation. The Court has allocated 6 weeks for the hearing of the class 1 matter.

39. The parties have at all relevant times heretofore proceeded on the basis that the class 4 proceedings would not be pursued until after the class 1 application has been determined.

40. The Court is not satisfied that it is reasonable to entertain an application for a stay in the current circumstance. Nevertheless, it must be recognised that serious questions have been raised in respect of the jurisdiction of the Court. These issues have not been raised formally nor articulated in such a way that the Court can comprehend what consequences may flow for the future conduct of the case in class 1.

41. It is appropriate therefore that the council’s application for leave to rely on the notice of motion be refused but that directions be made on the basis of a foreshadowed amendment to the statement of issues. The directions should include orders for the parties to file and serve documents in the nature of pleadings by way of points of claim and points of defence in respect of the jurisdictional issue. When that process is complete the Court will be in a better position to determine whether the question of jurisdiction is to be determined as a separate preliminary issue.

42. In the meantime the hearing on the merits should continue.

43. Leave is granted to file the notice of motion in the class 4 proceedings with liberty to restore on 2 days notice after there has been an effective joinder of issue on the jurisdiction question in the class 1 matter.