Gwandalan Summerland Point Action Group Inc v Minister for Planning - [2009] NSWLEC 140

No judgment structure available for this case.

Reported Decision: 168 LGERA 269
[2009] ALMD 5860
75 NSWLR 269

Land and Environment Court

of New South Wales

CITATION: Gwandalan Summerland Point Action Group Inc v Minister for Planning [2009] NSWLEC 140

PARTIES: Gwandalan Summerland Point Action Group Inc (Applicant)
Minister for Planning (First Respondent)
Rose Property Group Pty Ltd (Second Respondent)
Lakeside Living Pty Ltd (Third Respondent)

FILE NUMBER(S): 41214 of 2008

CORAM: Lloyd J

KEY ISSUES:
JUDICIAL REVIEW :- decisions made by Minister for Planning - rezoning of land - concept plan approval - project approval - apprehended bias - irrelevant considerations - pre-existing agreements entered by Minister requiring him to use reasonable endeavours to implement an environmental land offset scheme, approve proposed land rezoning and approve a concept plan
BIAS :- apprehended bias - test for - Minister of the Crown - decisions were administrative and not made in the exercise of political functions - actions of Minister and pre-existing agreements with developers regarding environmental land offset scheme held to give rise to reasonable apprehension of bias

LEGISLATION CITED: Environmental Planning and Assessment Act 1979 Pt 3A s 75A, s 75B, s 75D, s 75E, s 75F, s 75G, s 75H, s 75I, s 75J, s 75M, s 75N, s 75O and s 75R, Pt 4 Div 6 and Div 6A
State Environmental Planning Policy (Major Projects) 2005 Sch 2 cl 1(1)(i)

CASES CITED: Ansett Transport Industries (Operations) Pty Ltd v The Commonwealth (1977) 139 CLR 54
CREEDNZ Inc v Governor-General [1981] 1 NZLR 172
Ebner v Official Trustee in Bankruptcy [2000] HCA 63; (2000) 205 CLR 337
F & D Bonaccorso Pty Ltd v City of Canada Bay Council (No. 2) [2007] NSWLEC 537; (2007) 158 LGERA 250
Franklin v Minister of Town and Country Planning [1948] AC 87
Hot Holdings Pty Ltd v Creasy [2002] HCA 51; (2002) 210 CLR 438
Johnson v Johnson [2000] HCA 48; (2000) 201 CLR 488
Laws v Australian Broadcasting Tribunal (1990) 170 CLR 70
Livesey v New South Wales Bar Association (1983) 151 CLR 288
Lower Hutt City Council v Bank [1974] 1 NZLR 545
Lu v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCAFC 340; (2004) 141 FCR 346
McGovern v Ku-ring-gai Council [2008] NSWCA 209; (2008) 161 LGERA 170; (2008) 251 ALR 558
Mid Western Community Action Group Inc v Mid- Western Regional Council (No. 2) [2008] NSWLEC 143
Minister for Aboriginal Affairs v Peko Wallsend Ltd (1986) 162 CLR 24
Minister for Immigration & Multicultural Affairs v Jia Legeng [2001] HCA 17; (2001) 205 CLR 507
Old St Boniface Residents’ Association Inc v City of Winnipeg [1990] 3 SCR 1170
R v Commonwealth Conciliation and Arbitration Commission; Ex parte Angliss Group (1969) 122 CLR 546
R v Corporation of the City of Marion; Ex parte Independent Grocers Co-operative Ltd (No. 2) (1984) 37 SASR 436; (1984) 59 LGERA 244
Re MacTiernan; Ex parte Coogee Coastal Action Coalition Inc [2004] WASC 264
Re MacTiernan; Ex parte Coogee Coastal Action Coalition Inc [2005] WASCA 109; (2005) 30 WAR 138
South Australia v O’Shea (1987) 163 CLR 378
Webb v The Queen (1994) 181 CLR 41
Williams v Director General of the Department of Environment and Conservation [2004] NSWLEC 613

TEXTS CITED: Aronson et al, Judicial Review of Administrative Action, 4th ed (2009) Lawbook Co

DATES OF HEARING: 9 June 2009, 10 June 2009 and 11 June 2009

DATE OF JUDGMENT:
31 August 2009

LEGAL REPRESENTATIVES:
APPLICANT:
J K Kirk (barrister) and G E S Ng (barrister)
SOLICITORS:
Environmental Defender's Office
FIRST RESPONDENT:
J E Griffiths SC, S J Free (barrister) and C C Spruce (barrister)
SOLICITOR:
Christine Hanson
Department of Planning
SECOND AND THIRD RESPONDENTS:
M J Leeming SC and I J Hemmings (barrister)
SOLICITORS:
Corrs Chambers Westgarth

JUDGMENT:

- 51 -

IN THE LAND AND
ENVIRONMENT COURT
OF NEW SOUTH WALES

Lloyd J

Monday, 31 August 2009

LEC No. 41214 of 2008

GWANDALAN SUMMERLAND POINT ACTION GROUP INC v MINISTER FOR PLANNING & (2) ORS [2009] NSWLEC 140

JUDGMENT

1 HIS HONOUR: On Tuesday, 2 September 2008, the then Minister for Planning, Mr Frank Sartor MLA, caused to be published in a special supplement of the New South Wales Government Gazette, No 109, State Environmental Planning Policy (Major Projects) 2005 (Amendment No. 26), which rezoned land owned by the second and third respondents, Rose Property Group Pty Ltd and Lakeside Living Pty Ltd, both of which have a common shareholding. The rezoning had the effect of enabling the second and third respondents’ land at Gwandalan and Catherine Hill Bay to be used for residential purposes, at the same time reserving other parts of their land for environmental conservation, or for national parks and nature reserves.

2 On the same day, the Minister granted the following approvals under Pt 3A of the Environmental Planning and Assessment Act 1979:

(a) approval for a concept plan under s 75O of the Act for development at Catherine Hill Bay and Gwandalan, comprising a staged residential development for 600 dwellings at Catherine Hill Bay and 187 residential lots at Gwandalan; and
(b) a project approval under s 75J of the Act for the subdivision of land at Gwandalan into 187 residential lots and one residue lot, including civil works, a public road network and public domain improvements.

3 The applicant, Gwandalan Summerland Point Action Group Inc, has brought proceedings for declarations that both approvals are void and of no effect and for orders quashing the approvals. The applicant relies upon two grounds of invalidity:

(i) There was, at the time the Minister made the decisions to grant the approvals, a reasonable apprehension of bias on the part of the Minister.

The test for apprehended bias

4 Before embarking on the detailed facts, it is necessary to resolve the question of what is the appropriate test for apprehended bias where the decision-maker is a minister. There is no doubt that the test for a judicial officer is whether a fair-minded and informed observer might reasonably apprehend that the judge might not bring an impartial and unprejudiced mind to the resolution of the question in issue: Livesey v New South Wales Bar Association (1983) 151 CLR 288 at 293-294, Johnson v Johnson [2000] HCA 48; (2000) 201 CLR 488 at [11], Ebner v Official Trustee in Bankruptcy [2000] HCA 63; (2000) 205 CLR 337 at [6], McGovern v Ku-ring-gai Council [2008] NSWCA 209; (2008) 161 LGERA 170; (2008) 251 ALR 558 at [14] and [72], F & D Bonaccorso Pty Ltd v City of Canada Bay Council (No. 2) [2007] NSWLEC 537; (2007) 158 LGERA 250 at [110]. This so-called “two mights” test sets a low threshold: McGovern at [14]. The question is one of possibility (real and not remote), not probability and the test requires no conclusion about what factors actually influenced the outcome: Ebner at [7]. The test is objective: Johnson v Johnson at [12]. The fair-minded hypothetical observer is one who is properly informed: Hot Holdings Pty Ltd v Creasy [2002] HCA 51; (2002) 210 CLR 438 at [68] and [76]. That is, there must be attributed to the hypothetical fair-minded observer knowledge of the actual circumstances of the case: Laws v Australian Broadcasting Tribunal (1990) 170 CLR 70 at 87; although he or she is not to be assumed to have a detailed knowledge of the law: Johnson v Johnson at [13].

5 The question for determination, however, is whether this test for bias applies also to administrative decision-makers and, in particular, to an administrative decision-maker who is a minister of the Crown. Dr M J Leeming SC and Mr I J Hemmings, appearing for the developers, submit that a lower test or standard applies to decision-makers outside the judicial system, and in particular, to ministers. Reliance is placed on a number of authorities: Minister for Immigration & Multicultural Affairs v Jia Legeng [2001] HCA 17; (2001) 205 CLR 507; Hot Holdings Pty Ltd v Creasy; CREEDNZ Inc v Governor-General [1981] 1 NZLR 172; Re MacTiernan; Ex parte Coogee Coastal Action Coalition Inc [2004] WASC 264; Re MacTiernan; Ex parte Coogee Coastal Action Coalition Inc [2005] WASCA 109; (2005) 30 WAR 138; Franklin v Minister of Town and Country Planning [1948] AC 87; Mid Western Community Action Group Inc v Mid- Western Regional Council (No. 2) [2008] NSWLEC 143; and Aronson et al, Judicial Review of Administrative Action, 4th ed (2009) Lawbook Co at 697.

6 In the English case of Franklin v Minister of Town and Country Planning, the House of Lords held, at 102, that the Minister had no judicial or quasi- judicial duty imposed on him, so that considerations of the bias rule had no application in the exercise of his duty to consider a report on his proposal to site a new town in a certain area. Their Lordships also found, however, at 105, that the facts in that case did not establish that the Minister had forejudged any genuine consideration of objections to the proposal.

7 CREEDNZ Inc v Governor-General was a challenge to the validity of an Order in Council to apply a “fast track” procedure for a proposed aluminium smelter. An Order in Council is an order made by the Governor-General by and with the advice and consent of the Executive Council, so that the attack was in reality against the responsible ministers who comprised the Executive Council and the Cabinet and who advised the Governor-General to make the order. The Government had decided that a smelter project was likely to be in the national interest and should go ahead if possible. The allegation was that there was a real probability or suspicion of predetermination or bias. Cooke J held, at 179, that such allegations are beside the point in relation to a decision of this nature at this governmental level, referring to the intention behind the National Development Act 1979 (NZ). Cooke J also said (at 179):

“ It would be naive to suppose that Parliament can have meant ministers to refrain from forming and expressing, even strongly, views on the desirability of such projects until the stage of advising on an Order in Council. ”

8 Again, however, the Court found that the facts did not establish the allegations of predetermination or bias, Richardson J adopting (at 194) the joint judgment of the High Court in R v Commonwealth Conciliation and Arbitration Commission; Ex parte Angliss Group (1969) 122 CLR 546 at 555:

“ But the mere expression of opinion upon a general question of policy and even the fact that a step has been taken in furtherance of such a policy, if that be the right view of what the Commission did and the President said, give, in our opinion, no reasonable ground for a lack of confidence in the integrity of future decisions upon or involving the question of equal pay. ”

9 In Minister for Immigration and Multicultural Affairs v Jia Legeng, Gleeson CJ and Gummow J referred to Franklin at [102] and to CREEDNZ at [103], in holding that the public interest arising from the power given by s 501 and s 502 of the Migration Act 1958 (Cth) meant that the position of the Minister is substantially different from that of a judge or quasi-judicial officer adjudicating in adversarial litigation (at [102]):

“ It would be wrong to apply to his conduct the standards of detachment which apply to judicial officers or jurors. There is no reason to conclude that the legislature intended to impose such standards upon the Minister, and every reason to conclude otherwise .”

10 Sections 501 and 502 of the Migration Act enabled the Minister to refuse a visa or cancel a visa if he was satisfied that the person was not of good character having regard to the person’s criminal conduct or general conduct; and if the Minister decides that because of the seriousness of the circumstances it is in the national interest that the person be declared to be an excluded person, he may declare the person to be an excluded person. The Minister refused to grant Mr Jia a transitional (permanent) visa or a resident return visa on the ground that, whilst in Australia on a student visa, Mr Jia committed crimes for which he was sentenced to imprisonment for six years and three months. The Minister had previously given a radio interview during which he had expressed views about the matter and stated his beliefs about the character of persons who had committed crimes and had been punished by imprisonment.

11 Gleeson CJ and Gummow J said, at [78] in their joint judgment, that it was a matter of importance that the statement of the Minister be evaluated in the light of his political functions. Their Honours went on to say, moreover, that it was not only the character of the person upon whom Parliament had conferred the decision-making capacity, but also the nature of the decision-making process.

12 Gleeson CJ and Gummow J observed, at [102], after referring to Franklin, that the power given by s 502 required the Minister to consider the national interest, and adopted the statement of Brennan J in South Australia v O’Shea (1987) 163 CLR 378 at 411: “The public interest in this context is a matter of political responsibility”. Their Honours continued (at [102]):

“ The position of the Minister is substantially different from that of a judge, or quasi-judicial officer, adjudicating in adversarial litigation.”

13 Gleeson CJ and Gummow J concluded, however, by stating (at [105]):

“ The Minister was obliged to give genuine consideration to the issues raised by ss 501 and 502, and to bring to bear on those issues a mind that was open to persuasion. He was not additionally required to avoid conducting himself in such a way as would expose a judge to a charge of apprehended bias .”

14 Kirby J, although dissenting on the facts, held, at [135], that the test for imputed bias accepted by the court is expressed in terms of possibilities (might), rather than of the proof of a high probability. Moreover, his Honour also held at [136] that “the rule is one that applies to decisions of every public office-holder”, but it adapts to the nature and significance of the decision concerned, the character of the office of the decision-maker and the requirements, express or implied, of any legislation applicable to the case.

15 Both Jia Legeng and CREEDNZ were referred to by McLure J in Re MacTiernan; Ex parte Coogee Coastal Action Coalition Inc [2004] WASC 264. This was an application for an order nisi for writs of certiorari and prohibition against the Minister for Planning and Infrastructure, the Western Australian Planning Commission and others, following a cabinet resolution, subsequently approved by the Governor, to approve an amendment to the Metropolitan Planning Scheme to enable the development of a marina and canal-type residential development at Port Catherine. The rezoning gave effect to heads of agreement previously made between the Western Australian Planning Commission and the developers and the recommendation of the Commission that the rezoning be approved. There were several bases of challenge, including conflict of interest, prejudgment and bias.

16 McLure J set out the general test for bias as follows (at [75]):

would

Webb v The Queen

17 Her Honour observed that this test is applicable to judicial proceedings. With respect, her Honour misstated the test. The correct test is the “two mights” test which I have set out in par [4] above. Her Honour then went on, at [76], to consider whether the test which she had propounded applies to decisions made by policy bodies such as planning authorities that exercise numerous statutory functions. Her Honour then referred to a number of authorities, including Jia Legeng, at [77], which she cited as authority for the proposition that where ministers and planning authorities are concerned it must be shown that the decision-maker is so committed to a conclusion already formed as to be incapable of alteration, whatever evidence or arguments may be presented. Her Honour then continued (at [77]):

“ This formulation is similar to a requirement of proof of an actual fetter rather than an apprehension of fettering .”

18 Again, with the greatest of respect to her Honour, these are not the tests adopted by the High Court in Jia Legeng – see, in particular, the passage from the judgment of Gleeson CJ and Gummow J, noted in par [13] above.

19 The return of the order nisi came before the Western Australian Court of Appeal: Re MacTiernan; Ex parte Coastal Action Coalition Inc [2005] WASCA 109; (2005) 30 WAR 138. McLure JA (as she had become) delivered the principal judgment, in which Wheeler and Pullin JJA concurred. The terms of the grant of the order nisi insofar as the question of bias and prejudgment were concerned were limited to whether the decisions and recommendations of the Commission were affected by bias or prejudgment by reason of the prior agreement. The challenge to the Minister’s decision was based on the ground that the approval and rezoning were premised on the decisions and recommendation of the Commission which were themselves said to be invalid. That is to say, the case is not about what test for bias or prejudgment applies to decisions and actions of a minister. This was because, under the terms of the relevant legislation, the Minister’s discretion was circumscribed. If the report of the Commission recommended that the amendment not be proceeded with, the Minister had a discretion to either present the amendment to the Governor for his consideration, or a discretion to withdraw the amendment. If, however, the Commission did not recommend that the amendment not be proceeded with, the Minister had no discretion and was required to submit the amendment to the Governor. That is, the question was whether the Commission was disqualified from making the decision on the ground of a reasonable apprehension of bias.

20 McLure JA repeated, at [65], the same test for apprehended bias that she had set out in her judgment on the application for an order nisi, noted in par [16] above, but which sets the bar at a higher level than the “two mights” test. Her Honour then notes, at [66], that the content of the test or its application can vary according to the circumstances, citing Hot Holdings at [70], Ebner at [4] and Jia Legeng at [99]. At [67] and [68], however, McLure JA sets out the “two mights” test as being the test which applied to a judge exercising judicial power, noting at [68] that the question is one of possibility (real and not remote) not probability. Her Honour then states (at [69]):

Jia Legeng

21 McLure JA then observed, at [71], that lower and foreign courts have considered the test that applies to decisions made by planning bodies that exercise numerous statutory functions:

Blue Mountains City Council v Prospect County Council

McGovern

22 McLure JA then turned her attention to the broad statutory framework in which the Western Australian Planning Commission operates and the factual context in which the decision came to be made, noting that the Commission may itself acquire, develop and sell land and enter into agreements with owners of land for the redevelopment of that land for the purposes of the Metropolitan Regional Scheme. In these circumstances her Honour said (at [79]):

Jia Legeng

including the power to itself participate, including as owner, in the development and redevelopment of land for the purposes of the MRS.

23 McLure JA set out the test for reasonable apprehension of bias on the part of the Commission as follows (at [83]):

incapable

would

24 The case of Webb v The Queen (1994) 181 CLR 41, upon which McLure JA relied, was a case in which a juror in a trial for murder gave a bunch of flowers to the deceased’s fiancée at the courthouse with the request that it be given to the deceased’s mother. The matter was brought to the judge’s attention. The juror was identified and apologised for her conduct. Counsel for each of the two accused asked for the jury to be discharged. The trial judge, Debelle J, held that the question he had to determine was whether “there was a real danger that the position of the accused had been or might have been prejudiced by what had occurred”. He directed that the trial should proceed. He stressed to the jury that they should have regard only to the evidence, which they were to consider in a dispassionate manner, putting all feelings of sympathy or emotion to one side. The accused were convicted.

25 Mason CJ and McHugh J, in their joint judgment, noted that Debelle J relied on English authority in formulating the “real danger” test. Their Honours continued (at 46-47):

“ In our opinion, the test that his Honour should have applied was whether, despite the warning that he proposed to give to the jury, the circumstances of the incident would still give a fair-minded and informed observer a reasonable apprehension of a lack of impartiality on the part of the juror .”

26 However, their Honours immediately went on, at 47, to adopt the “two mights” test, which they describe as the reasonable apprehension test or the reasonable suspicion test, rather then the “real danger” test. Similarly, Deane J, although dissenting in the result, adopted the “two mights” test, or reasonable apprehension test, and rejected the “real danger” of bias test (at 67-8):

Livesey v New South Bar Association

27 Deane J went on to say, at 68, that “the test is an objective one and the standard to be observed in its application is that of a hypothetical fair-minded and informed lay observer”. In his Honour’s view, the reasonable apprehension test should be applied regardless of whether a question of appearance of bias arises in relation to a judge, a statutory office-holder who is obliged to observe the requirements of procedural fairness or a juror (at 69). The other member of the majority, Toohey J, also adopted the “two mights” test, at 87-88.

28 It seems to me that the statement of McLure JA that the general test for bias is whether the relevant circumstances “would” give rise in the mind of a fair-minded and informed observer to a reasonable apprehension of a lack of impartiality, relying upon Webb v The Queen, was taken out of context. A full reading of the judgment in Webb discloses that the High Court adopted and applied the “two mights” test for reasonable apprehension of bias.

29 In Ebner the majority accepted, at [4], that the application of the principle in connection with decision-makers outside the judicial system must sometimes recognise and accommodate differences between court proceedings and other kinds of decision-making. Their Honours went on to say at [5]: “These differences, however, must not obscure the fundamental principle”.

30 Hot Holdings Pty Ltd v Creasy is a case involving the question of the test for apprehended bias in ministerial decision-making – in that case, the grant of a mining exploration licence. A public servant involved in the preparation of a minute to be considered by a minister making a decision under the statute had a pecuniary interest which was potentially affected by the Minister’s decision. The involvement of the public servant was thus limited and, at most, peripheral and was not known by the Minister, which was sufficient for the claim of apprehended bias to be dismissed. The High Court nevertheless made some general statements of principle. Gaudron, Gummow and Hayne JJ, in a joint judgment, said, at [50]:

“ There may be cases in which a decision-maker, especially a Minister, may properly have regard to a wide range of considerations of which some may be seen as bearing upon such matters as the political fortunes of the government of which the Minister is a member and, thus, affect the Minister's continuance in office. It has been said that ‘the whole object’ of a statutory provision placing a power into the hands of the Minister ‘is that he may exercise it according to government policy’ [Wade and Forsyth, Administrative Law, 8th ed (2000), p 464]. It would be wrong to assume that in every case a decision-maker can act only if he or she has the same level of independence and security as a judge and, in that sense, has nothing to gain or lose from the decision made .”

31 McHugh J said at [69]: “The common law rule embodied in Ebner applies equally to a Minister of the Crown or an officer who assists in a decision-making process”. His Honour continued at [70]:

Minister for Immigration and Multicultural Affairs v Jia Legeng

32 Kirby J, although dissenting in the result, said, at [115], that the law stated in Ebner must be applied in Australian courts. His Honour continued:

“ Although stated in the context of the disqualification for bias of judicial officers, it is obvious that (statute apart) no different or at least no stricter rule would be applied to ministers and other public officials .”

33 Kirby J said, at [125], that where the powers of administrative decision-making have been reposed by Parliament in a minister, the normal implication would be that the legislature conferring the powers expected and intended them to be exercised by observing the requirements of procedural fairness, including the avoidance of disqualifying (actual or imputed) bias.

34 Kirby J referred to Jia Legeng, in which he expressed the opinion “which I still hold” that it is “quite wrong to suggest that, because the decision-maker is a minister, necessarily a politician and an elected official, he or she is exempt from the requirements of natural justice, or enjoys an immunity from disqualification for imputed bias” at [129]. His Honour continued:

Jia Legeng

35 Kirby J stated, at [132], that the test for apprehended bias looking at the decision of the Minister is whether a reasonable member of the public might conclude that there is a possibility that the decision could have been affected by the earlier participation in it of officers who, personally or through their immediate families, had undisclosed interests of which they were aware and these interests would be advanced if the Minister accepted the departmental recommendation (citing Jia Legeng at [133] - [135] – the emphasis is his Honour’s).

36 In this Court, I held in Williams v Director General of the Department of Environment and Conservation [2004] NSWLEC 613 at [77] that the “two mights” test for apprehended bias applies to decisions of the Director-General exercising his power under the National Parks and Wildlife Act 1974, s 87 and s 90, to allow the collection and destruction of Aboriginal objects.

37 Also in this Court, Biscoe J applied the “two mights” test in relation to decision-making by a local government council in F & D Bonaccorso Pty Ltd v City of Canada Bay Council (No. 2) at [110]. His Honour also held at [113] that the test in Australia for apprehension of bias is also unitary: “It is the same for administrative decision-makers as for judicial decision-makers, although its content may often be different” (referring to Hot Holdings Pty Ltd v Creasy at [70] and Laws v Australian Broadcasting Tribunal at 90).

38 Biscoe J noted at [115] that it has been said that the application of the principle of procedural fairness or natural justice in connection with decision-makers outside the judicial system must sometimes recognise and accommodate differences between court proceedings and other kinds of decision-making (referring to Ebner at [4] and Jia Legeng at [99] inter alia). His Honour went on to hold at [120] that if a council as a whole is affected by the appearance of prejudgment it will be disqualified from considering a matter, subject to the possible application of the doctrine of necessity; but the content of the apprehended bias test in the case of a local council should take into account that councillors, unlike judicial officers, are elected individuals with political ties who are expected to support particular views as to what is in the best interest of the community (at [121]).

39 Biscoe J referred at [124] – [133] to cases of decision-making by local government councils in other jurisdictions including, relevantly, Lower Hutt City Council v Bank [1974] 1 NZLR 545. In that case, the Lower Hutt City Corporation entered into an agreement to lease land to a developer. Included in the contract was an undertaking on the part of the Council to take all steps necessary to stop certain streets on the land. The undertaking also stated: “If the corporation is unable to stop the said portions of the said streets or either of them by virtue of a contrary decision of a Magistrate’s Court this agreement shall be null and void and of no effect”. The statutory procedure for the stopping of streets required the Council to give notice of its proposal for the streets to be stopped. If there were objections, the Council was required to inquire into and dispose of the objections, after which it might reaffirm its decision to stop the streets. An appeal lay to a magistrates court. One of the objectors moved for a writ of prohibition to prevent the Council from proceeding on the ground that there was a real likelihood that it would feel constrained to disallow the objections. The Court of Appeal affirmed the decision of Wild CJ to grant a writ of prohibition. McCarthy P, delivering the judgment of the Court of Appeal, said, at 548, that there was no longer a clear-cut distinction between administrative functions, on the one hand, and judicial functions, on the other. McCarthy P continued (at 550):

“ We think that the state of impartiality which is required is the capacity in a council to preserve a freedom, notwithstanding earlier investigations and decisions, to approach their duty of inquiring into and disposing of the objections without a closed mind, so that if considerations advanced by objectors bring them to a different frame of mind they can, and will go back on their proposals. As to the necessary appearance of impartiality, we think it must follow that if a public authority exhibits that it has undertaken in advance to exercise the power and duty expressly entrusted to it by the Legislature in a specific way which appears to obstruct the fair consideration and disposal of public rights, prohibition should normally issue .”

40 McCarthy P dismissed the question of whether the contractual obligation is enforceable or not in the following statement (at 550-551):

“ What we are concerned with is, as we have stated earlier, the related principle that when a public authority by contract purports to bind itself in such a way that it appears to right-thinking people that the authority is no longer able to discharge its statutory duty with fairness, the Courts will intervene to prevent it purporting to perform that duty. In the application of that principle it seems to us not to matter whether the contractual obligation is enforceable or not, so long as it can fairly be said that the obligation appears to be exercising, in fact, a restraint on the freedom of the council to discharge its duty in the way the Legislature intended.”

41 In McGovern v Ku-ring-gai Council, a case which is binding on me, the Court of Appeal considered the test for reasonable apprehension of bias by a council in its decision-making functions in relation to development applications. The second respondent, Mrs Allan, lodged a development application with the Council for proposed alterations and additions to her property. The appellants, the McGoverns, were neighbours who objected to the development application. Emails after the lodgement of the development application between Mrs Allan’s husband and two councillors showed that they supported Mrs Allan’s development application. The Council granted its consent to the development application. The McGoverns then challenged the Council’s determination to grant consent to the application.

42 Spigelman CJ accepted, at [14], the Australian test for apprehended bias as expressed in terms of “two mights”, but went on, at [15], to say that the test for prejudgment in Australian law is that identified by the Supreme Court of Canada in Old St Boniface Residents’ Association Inc v City of Winnipeg [1990] 3 SCR 1170: the decision-maker must be “capable of being persuaded”. The Chief Justice observed that a similar approach has been adopted in Australia in prejudgment issues, referring to the judgment of Gleeson CJ and Gummow J in Jia Legeng at [71] and [105] - whether the decision-maker “is open to persuasion” or, at [72] - whether “the conclusion already formed [is] capable of alteration whatever evidence or arguments may be presented”. The Chief Justice held, at [23], that the “open to persuasion” test is an appropriate formulation for bias by prejudgment, to which the dual “might” test of apprehended bias must be applied.

43 Basten JA (with whose reasons Campbell JA agreed), accepted, at [72], that there was no dispute that the general approach required to be applied was the “two mights” test. The important question in that case, as his Honour noted at [75], was “how the test operates in relation to a local government authority, constituted by elected councillors, which has a diversity of functions including the broadly political (see Local Government Act 1993 (NSW), s 8) and those of an administrative decision-maker granting authority for specific developments, in accordance with statutory criteria, as in the present case”. Importantly for the purpose of the present case, his Honour continued:

Jia

Legeng

44 In relation to the conferring of a power on a minister, Basten JA referred, at [76], to the judgment of Hayne J in Jia Legeng, at [187], in which the following statement is, it seems to me, of particular significance for the purposes of the present case:

“ It is critical, then, to understand that assessing how rules about bias, or apprehension of bias, are engaged depends upon identification of the task which is committed to the decision-maker .”

45 Basten JA observed (at [110]):

Ebner

an articulation of the logical connection between the matter and the feared deviation from the course of deciding the case on its merits

Ebner

“ Its application requires two steps. First, it requires the identification of what it is said might lead a judge (or juror) to decide a case other than on its legal and factual merits. The second step is no less important. There must be an articulation of the logical connection between the matter and the feared deviation from the course of deciding the case on its merits. … Only then can the reasonableness of the asserted apprehension of bias be assessed .”

46 I come to the following conclusions, having regard to the principles discussed in the authorities to which I have referred above. The test for apprehended bias must have regard to the different standards which apply between court proceedings on the one hand, and ministerial and administrative decision-making on the other hand: Ebner at [4], McGovern at [75]. However, these differences must not obscure the fundamental principle: Ebner at [5] and [110]. In the case of a power exercised by a minister, the standard depends upon identification of the task which is committed to the minister: Jia Legeng at [187], McGovern at [76].

47 In the present case, although the decision-maker is a minister, he is, unlike in CREEDNZ, not giving effect to an Order in Council - in effect, a decision of the Executive Council and the Cabinet. The Minister’s determination was not at that governmental level of policy making. Neither was the Minister implementing a decision based upon a general question of governmental policy: Hot Holdings at [50]. Although the decision of a minister must be evaluated in the light of their political functions (as noted by Gleeson CJ and Gummow J in Jia Legeng at [78]), the Minister was not performing a political function. His determination had no bearing on the political fortunes of the Government of which he was a member: Hot Holdings at [50].

48 Having regard to the nature of the decision-making process in this case (Jia Legeng at [78]), the Minister was exercising his powers as a public office-holder in the capacity of an administrative decision-maker determining a particular development proposal. Although he was exercising a decision-making function outside the judicial system, that fact must not obscure the fundamental principle: Ebner at [5]. In this respect, he was performing a function which was not materially different from that of a local government council, as in McGovern. He was thus subject to the “two mights” test in the same way as every other public office-holder: Jia Legeng at [136]. As McHugh J said in Hot Holdings at [69]: “The common law rule embodied in Ebner applies equally to a minister of the Crown”, and, as Kirby J said to a similar effect in the same case at [115]: “No different or at least no stricter rule would be applied to ministers and other public officials”.

49 The apprehension of bias which is alleged in the present case is not based upon bias by interest, but bias by prejudgment. The application and precise content of the test varies depending on the context. As stated in Ebner at [8] and repeated in McGovern at [111], this requires the identification of what it is said might lead the decision-maker to decide the matter other than on its merits and requires an articulation of the logical connection between the matter and the feared deviation from the course of deciding the matter on its merits. Accordingly, I now turn to the context in which the Minister’s determination was made.

The statutory context

50 Both the concept plan approval and the project approval were granted under Pt 3A of the Environmental Planning and Assessment Act 1979, the relevant provisions of which I now describe.

51 An “approved project” is defined as “a project to the extent that it is approved by the Minister under this Part, but does not include a project for which only approval for a concept plan has been given”; and a “project” is defined as “development that is declared under s 75B to be a project to which this Part applies”: s 75A.

52 Section 75B states that Pt 3A applies to the carrying out of development that is declared to be a project to which this Part applies: (a) by a State environmental planning policy; or (b) by an order of the Minister published in the Gazette. The Minister’s approval is required for development to which Pt 3A applies: s 75D. An application for the approval of the Minister to carry out a project must be lodged with the Department of Planning: s 75E; and the Director-General must then prepare environmental assessment requirements for the project: s 75F(2).

53 Section 75G(1), as in force at the relevant time, provided that the Minister may constitute: (a) a panel of experts; or (b) a panel of officers representing the Department and other relevant public authorities, to assess any aspect of a project referred to the panel by the Minister. The proponent must submit the environmental assessment to the Director-General, who must in turn make it publicly available for at least 30 days, during which period any person may make a written submission to the Director-General concerning the matter: s 75H(1), s 75H(3) and s 75H(4). The Director-General may then require the proponent to submit to him or her a response to the issues raised in the public submissions, along with a preferred project report that outlines any proposed changes to the project to minimise its environmental impact, and any revised statement of commitments: s 75H(6). If the Director-General considers that significant changes are proposed to the nature of the project, then he or she may require the proponent to make the preferred project report available to the public: s 75H(7).

54 Section 75I, as in force at the relevant time, provided that the Director-General must give a report on a project to the Minister for the purpose of the Minister’s consideration of the application for approval to carry out the project, such report to include, inter alia, a copy of the proponent’s environmental assessment, any advice provided by public authorities on the project, a copy of any report of a panel constituted under s 75G in respect of the project and any environmental assessment undertaken by the Director-General or any other matter the Director-General considers appropriate.

55 If the requirements described above have been complied with, the Minister may approve or disapprove the carrying out of the project: s 75J(1). When deciding whether or not to approve the carrying out of a project, the Minister is to consider the Director-General’s report on the project and the reports, advice and recommendations in the report: s 75J(2). A project may be approved with such modifications or on such conditions as the Minister may determine: s 75J(4).

56 Section 75M(1) states that the Minister may authorise or require the proponent to submit a concept plan for a project. The concept plan is to outline the scope of the project and any development options. A detailed description of the project is not required: s 75M(2). The concept plan is to be lodged with the Director-General: s 75M(3). Section 75N provided that the provisions of s 75F to 75I which are relevantly noted above also apply to approval for the concept plan for a project.

57 Section 75O(1), as in force at the relevant time, provided that if the proponent submits a concept plan for a project and the environmental assessment requirements described above have been complied with, the Minister may give or refuse to give approval for the concept plan. When deciding whether or not to give approval for the concept plan, the Minister is to consider, inter alia, the Director-General’s report on the project and the reports and recommendations contained in the report along with certain other matters: s 75O(2). The Minister is also authorised (but not required) to take into account the provisions of any environmental planning instrument that would not apply to the project if approved because of s 75R: s 75O(3). Approval for a concept plan may be given with such modifications of the project as the Minister may determine: s 75O(4). Approval for the concept plan may be given “subject to satisfactory arrangements being made … under this Part or under the other provisions of this Act, for the purpose of fulfilling the obligations in a statement of commitments made by the proponent (including by entering into a planning agreement referred to in s 93F)”: s 75O(5).

58 Under s 75P, the Minister when giving an approval for a concept plan may make certain other or further determinations relating to the project which are not material for present purposes.

59 Section 75R(1) states that Pt 4 and Pt 5 of the Act do not, except as provided by Pt 3A, apply to or in respect of an approved project (including the declaration of the project as a project to which Pt 3A applies and any approval or other requirement under that Part for the project). (Part 4 relates to the making of development applications, their assessment and determination. Part 5 refers to the assessment and determination of a range of activities for which development consent under Pt 4 is not required, and certain other activities.) Although Pt 3 and State environmental planning policies apply, environmental planning instruments (other than State environmental planning policies) do not apply to or in respect of an approved project: s 75R(2) and s 75R(3). Section 75R(3A) provided that the Minister may, by order published in the Gazette, amend an environmental planning instrument to authorise, or to remove or modify provisions of the instrument that would prohibit or restrict development that is an approved project or a project for which a concept plan has been approved.

60 Section 75R (4) states:

“(4) Divisions 6 and 6A of Part 4 apply to projects (and the giving of approval for the carrying out of projects under this Part) in the same way as they apply to development and the granting of consent to the carrying out of development under Part 4, subject to any necessary modifications and any modifications prescribed by the regulations. However, a condition cannot be imposed under section 94, 94A, 94EF or 94F unless that section would have applied if this Part did not apply to the project and a development consent were granted.”

61 Division 6 of Pt 4, referred to in s 75R(4) above, relates to planning agreements (Subdivision 2 – s 93F to s 93L) and development consent contributions (Subdivisions 3 and 4 – s 94 to s 94EH). Division 6A of Pt 4, also referred to in s 75R(4) above, relates to conditions of development consent requiring land or contributions for affordable housing.

The relevant facts

62 The applicant’s case relies principally upon two agreements:

(a) A memorandum of understanding (“MOU”) made on 16 October 2006 between the Hon Bob Debus (MLA) as Minister for the Environment, the Hon Frank Sartor (MLA) as Minister for Planning, Mr B Rose for and on behalf of Coastal Hamlets Pty Ltd and Mr B Rose for and on behalf of Lakeside Living Pty Ltd.

63 Although the focus is principally upon the MOU and the deed, the parties rely upon the whole of the circumstances leading to the approval by the Minister for Planning of the concept plan under s 75O and his project approval under s 75J of the Act.

64 In September 2004, the New South Wales Government made a series of planning announcements, which included the development of a State Strategic Planning Framework and a series of “regional strategies”. According to the announcements, the regional strategies would not be legal instruments, but would identify how sustainable development will occur over the next 30 years, identify where growth will occur, and identify settlement patterns and major land release areas (inter alia). A number of areas were identified by the Government as priorities for a regional strategy, including the Lower Hunter region.

65 On 4 November 2005, the then Minister for Planning, Mr Sartor, released the draft Lower Hunter Regional Strategy, which was put on public display until 20 January 2006. The draft strategy contained various projections relating to the housing, employment and environmental needs of the Lower Hunter region in the 25 year period to 2031. Based on these projections, it identified new release areas for proposed residential development and future investigation areas for providing future long term opportunities for urban growth beyond 2031 or earlier if required. Development on land outside the identified areas was to be restricted. Importantly, there was no identification of either the Catherine Hill Bay land or the Gwandalan land, being the sites the subject of these proceedings, as within either a new release area or a future investigation area.

66 The Department of Planning received 1027 submissions on the draft strategy, following which a number of changes were made to it when the Minister released the final version of the strategy on 17 October 2006. In particular, the forecast regional population to 2031 was increased from 125,000 to 160,000, additional development areas were identified to house the expected larger population, and additional measures were identified to maintain or improve the biodiversity value of the Lower Hunter region and offset the proposed development, including the identification of a number of green corridors running through the region. The strategy states that the Wallarah Peninsula corridor is to be protected to provide a natural break between the Central Coast and the Lower Hunter. The Wallarah Peninsula includes the subject land at Catherine Hill Bay.

67 A study of the South Wallarah Peninsula produced by the Department of Environment and Conservation in 2005 had identified the conservation value of the South Wallarah area. That area had remained largely underdeveloped because the majority of land was owned by two mining companies carrying on underground mining, which had ceased in 2002.

68 An internal memorandum of the Department of Planning dated 1 August 2006 notes that in the course of finalising the Lower Hunter Regional Strategy, the Minister for Planning was approached by a number of major landholders who sought to increase the development potential of their lands in exchange for dedication of lands with significant conservation values. The memorandum notes that the Minister has entered into negotiations with these landowners “in order to identify a balanced outcome that will provide lasting benefits to the Lower Hunter community”. The memorandum also notes that “the Minister has taken the lead role in negotiations”, supported by advice from the Departments of Planning, Environment and Conservation, and Lands. The stated objectives of the negotiations were to “take advantage of a generational opportunity to expand the conservation reserves within the key conservation corridors of the Lower Hunter” and to “provide a balanced and reasonable level of development in return for the dedication of the land”.

69 On 28 September 2006, the Department of Planning retained the Crown Solicitor’s Office to draft legally enforceable agreements with four major landholders in the Lower Hunter region to implement a land offset scheme for the Lower Hunter. The Department stated that if final agreements are not possible before the final Lower Hunter Strategy and Environmental Land Offsets Agreement is publicly announced, tentatively scheduled for the week commencing 16 October 2006, then it would at least require executed MOUs with each landholder prior thereto. The four nominated landholders were Hardie Holdings Pty Ltd, Coal and Allied Industries Ltd, Rosecorp Pty Ltd and The Regional Land Management Corporation Pty Ltd. The Department’s letter to the Crown Solicitor states:

“ The agreements would not fetter the Minister for Planning’s discretion in exercising any of his functions in deciding whether or not to rezone these lands, but would ensure that the lands identified for inclusion in the National Parks Estate are transferred to the Government once the rezonings have been achieved ”.

70 The Department’s letter to the Crown Solicitor also states:

“ The MOU will be drafted on the basis that the Minister will use his best endeavours to ensure that the contents of the MOU will be achieved. ”

71 On 16 October 2006, the MOU described in par [62](a) above was executed. On the same day, similar MOUs were made with Hardie Holdings Pty Ltd and The Regional Land Management Corporation Pty Ltd. On 17 October 2006, a similar MOU was made with Coal and Allied Industries Ltd.

72 A draft Lower Hunter Regional Conservation Plan was released by the Department of Environment and Conservation on 17 October 2006. The Plan states that it sets out “a 25 year program to direct and drive conservation efforts in the Lower Hunter Valley” and “is a partner document to the Government’s Lower Hunter Strategy”. The document also states:

“ A number of private landholdings are also suitable for addition to the reserve system; however, they may only be acquired where landholders are willing to sell. Substantial funds would also be required usually to acquire such lands.

In response to submissions received on the [Lower Hunter Regional Strategy] the Government has entered into negotiations with several major landholders to refine potential development and conservation outcomes for their lands. As a result of these negotiations, legally enforceable agreements are being entered into to transfer 12,000 ha of privately owned lands to the Minister for the Environment for incorporation into the reserve system, at no cost, in exchange for appropriate development rights.”

73 On the same day, 17 October 2006, the Department of Planning released the final version of the Lower Hunter Regional Strategy, accompanied by a press release. The press release includes the following statement: “Another 12,000 hectares or privately owned land will be transferred to public ownership for permanent conservation”. The press release also states, however: “all proposed development will undergo a detailed planning process and include opportunities for public comment”. The Strategy itself includes maps showing “Proposed Conservation Lands (Dedications)” described as “[a]reas of high conservation values outside green corridors that will be dedicated to the Government”. Although the draft version of that document had made no mention of the subject land at Catherine Hill Bay and at Gwandalan, both are shown in the final version on an insert map in a map of the Lower Hunter region. The greater part of the Catherine Hill Bay land (on the South Wallarah Peninsula) is shown as “Proposed Conservation Land (Dedications)”, the balance shown as “Proposed Urban Area” and the Gwandalan land shown as “Proposed Urban Area”.

74 I now turn to the MOU in the present case. As noted in par [62](a) above, it was made on 16 October 2006. The Minister for the Environment and the Minister for Planning are together described as “the Government”. Coastal Hamlets Pty Ltd is described as the “CHB Landholder”, Lakeside Living Pty Ltd is described as the “Gwandalan Landholder”, and each are also stated as being a Rosecorp group company. “Schedule 1 land” is described as the parcels owned by the landholders and identified in schedule 1. There are two areas of land in schedule 1: Catherine Hill Bay, described as having a development potential of “residential development covering up to 60 hectares to achieve 600 dwellings”; and Gwandalan, described as having a development potential of “residential development over 26 hectares to achieve 12 dwellings per hectare as proposed in the Residential Development Strategy”. “Schedule 2 land” is defined as the parcels of land owned by the CHB Landholder identified in schedule 2, which in turn describes land at “Catherine Hill Bay and Wallarah Peninsula - Coastal Hamlets Pty Ltd lands within the white outline and not shaded green”, described as having an area of approximately 310 hectares.

75 Clauses 2.1 and 2.2 of the MOU state:

“ 2.1 The parties are committed to using their best endeavours to implement this MOU.

2.2 The parties acknowledge and agree that:

(a) this MOU is intended to express the parties’ objectives and firm intentions with regard to those matters with which it deals, but is not intended to create enforceable or binding legal obligations between them;

National Parks and Wildlife Act

Threatened Species Conservation Act

(c) nothing in this MOU is intended to constitute a representation, warranty or guarantee by or on behalf of the Government, the Minister for Planning or the Minister for the Environment .”

76 Clause 3.2 states:

“ 3.2 The Minister for Planning intends to use reasonable endeavours to allow the Landholder to achieve the development potential of Schedule 1 land by either:

Environmental Planning and Assessment Act

(c) Any other means that achieves or encourages the more intensive use of the land;

77 Clause 3.3 states:

“ 3.3 The Landholder intends to transfer ownership of Schedule 2 land to the Minister for the Environment upon the rezoning of Schedule 1 land.”

78 Clause 4.1 and 4.2 obliged the parties to “use their best endeavours” to enter into a legally enforceable agreement which would record the terms of the scheme by which achievement of the development potential of the Schedule 1 land would be offset by the transfer of the Schedule 2 land to the Minister for the Environment. The timing for this was “as soon as possible noting a target date of three months for this to occur”.

79 Clause 4.4, which may be described as a proportionality clause, states:

“ 4.4 The parties acknowledge that:

(a) If there is any reduction in Schedule 2 Land to be transferred then a proportional reduction will result for the development potential of the Catherine Hill Bay Schedule 1 Land;

(b) If the development potential of the Catherine Hill Bay Schedule 1 land in relation to the number of dwellings or lots to be achieved is reduced then a proportional reduction will occur in the amount of Schedule 2 Land to be transferred to the Minister for the Environment. ”

80 By letter dated 7 November 2006, Rosecorp Pty Ltd formally requested the Minister for Planning’s authorisation to submit a concept plan for the Catherine Hill Bay and Gwandalan sites pursuant to s 75E (in Pt 3A) of the Act, as contemplated by the MOU (cl 3.2(a)). The environmental assessment requirements of the Director-General under s 75F were also sought. The letter describes the name and description of the project as follows:

“ The proposed Concept Plan is for 374 ha of land owned and controlled by Coastal Hamlets Pty Ltd plus other land contained within the boundaries of the Coastal Hamlets ownership at Catherine Hill Bay and the 26 ha site at Gwandalan owned by Lakeside Living Pty Ltd. Overall the concept plan covers some 400 ha.

The proposed Concept Plan will be known as the Catherine Hill Bay/Gwandalan Concept Plan. It includes areas to be dedicated for future conservation uses as will as areas for future development.”

81 The letter states that it is proposed to concurrently lodge project applications with the concept plan. Subsequently, on 4 December 2006, Rosecorp submitted the concept plan to the Department of Planning.

82 On 11 December 2006, the Minister recorded the fact that he formed the opinion that the proposal was development of a kind described in Sch 2 of the State Environmental Planing Policy (Major Projects) 2005, cl 1(1)(i) - subdivision of land into more than 25 lots in the coastal zone - and thus declared to be a project to which Pt 3A of the Act applies for the purpose of s 75B of the Act. At the same time, the Minister authorised the submission of a concept plan for the proposal and directed that a panel of experts be constituted under s 75G(1) to consider and advise on the impacts of the proposal.

83 Also on 11 December 2006, the Director-General issued his environmental assessment requirements under s 75F. These included a requirement that the environmental assessment must address a number of key issues, including consistency with the Lower Hunter Regional Strategy and the MOU that applies to the land.

84 On 14 December 2006, Rosecorp submitted to the Department of Planning a State significant site study, a concept plan and an environmental assessment for both the Catherine Hill Bay and Gwandalan developments. These were then placed on public exhibition from 3 January 2007 to 2 March 2007.

85 In an undated letter, but which appears to have been sent in about February 2007, to Mr Robert Coombs, the ALP candidate for Swansea, the Minister for Planning, Mr Sartor, responded to a letter written by Mr Coombs regarding “concerns raised by the local community of Gwandalan in response to the Rosecorp application”. The Minister’s letter states, inter alia:

“ The NSW Government will ensure that any development of Gwandalan is appropriate and balanced.

If the development passes through the full assessment and approval process, then the timing of construction will be a matter for the developer.

...

will

is

86 The panel of experts, which was constituted by the Minister under s 75G, produced an interim report to the Minister on 13 April 2007. The panel reported that the concept plan in its submitted form was unacceptable and it could not support the current proposal.

87 On 27 May 2007, Rosecorp requested the Minister’s authorisation to submit a revised concept plan for the Catherine Hill Bay and Gwandalan sites and four projects applications for the Gwandalan site under s 75E of the Act. This was followed by a second request by Rosecorp dated 14 June 2007 for the Minister’s authorisation to submit a concept plan and four project applications for both sites under s 75E of the Act. The revised proposal would consist of the construction of 600 dwellings at Catherine Hill Bay and up to 220 dwellings at Gwandalan.

88 On 25 June 2007, the Minister made a direction under s 75G(1)(a) that a panel of experts be constituted to consider and advise on the revised applications. On 27 June 2007, the Minister declared by order under s 75B(1) that the development was a project to which Pt 3A of the Act applies. The Minister’s order was published in the Gazette on 6 July 2007.

89 On 1 August 2007, the Director-General issued new environmental assessment requirements for the revised concept plan and four project applications. On 20 August 2007, Rosecorp submitted to the Department of Planning its formal application under s 75H(1) and s 75N of Pt 3A of the Act, comprising a State significant site report, the Catherine Hill Bay and Gwandalan concept plan, the environmental assessment report, a project application for Gwandalan and three project applications for Catherine Hill Bay. On 24 August 2007, Rosecorp submitted a revised environmental assessment report to the Department of Planning. On 29 August 2007, Rosecorp again submitted a formal application under s 75H(1) and s 75N of Pt 3A of the Act, together with a State significant site report, the Catherine Hill Bay and Gwandalan concept plan and the four project applications. This time Rosecorp provided 25 hard copies and 30 electronic copies of each document.

90 On 8 November 2007, Mr Vincent Ramos, acting principal legal officer within the Department of Planning, sent an internal email to Mr Andrew Jordan, acting senior planner, regarding the implementation of the MOU. Mr Ramos states: “I understand that there is an expectation by the Minister that the Schedule 2 lands will be transferred to the State before any adjustments due to unrealizable [sic] lot yields”. Mr Ramos suggests entering into a conditional contract of sale of the Schedule 2 land for a nominal consideration of $1.00, with a special condition giving Rosecorp the option to require the State to reconvey the land for $1.00 if certain conditions are not fulfilled. The conditions would be the rezoning of the Schedule 1 land and the achievement of the anticipated lot yields, with an adjustment mechanism depending upon any shortfall in the lot yield. Mr Jordan responded by internal email on 9 November 2007, which states that, after discussion, this approach was not favoured, “because the Department would almost certainly appear to be obliged to issue approval if it had received all the environmental offset land for only $1”. Mr Ramos replied by email on the same date, noting that: “The Minister should only approve the relevant concept plan on its merits and not on whether the State can end up losing title of the Schedule 2 lands”. The email also states:

“ If the Minister or a local council’s grant of approval to a project or a DA [development application] is based on the commercial benefits deliverable by a planning agreement (and not on proper planning considerations) then this approval can be invalidated by a court ”.

91 In a further internal email from Mr Jordan to a Brett Whitworth on 15 November 2007, Mr Jordan states, inter alia: “Transfer of land - the Minister has indicated that he is not prepared to grant approval to a concept plan until the deed has been signed”.

92 On 6 December 2007, Rosecorp submitted to the Department of Planning a preferred project report for the Catherine Hill Bay and Gwandalan concept plan with a revised statement of commitments in response to submissions received during the exhibition period.

93 On 18 December 2007, the independent panel, which had been reconstituted by the Minister, issued a final report on the Catherine Hill Bay and Gwandalan concept plan and the project applications. The panel recommended that the concept plan as it related to Catherine Hill Bay be approved subject to various amendments. The panel recommended that the project applications also be approved provided they were amended so as to be consistent with the preferred project report.

94 On 19 December 2007, Rosecorp submitted to the Department its preferred project report for the Gwandalan project application, dealing with all issues raised by the panel, Government agencies and the public. On 27 February 2008, Rosecorp submitted an amended statement of commitments and an amended Catherine Hill Bay/Gwandalan concept plan. This provided for 187 dwellings at Gwandalan. On the same day, Rosecorp withdrew one of the project applications for Catherine Hill Bay, to be redesigned in accordance with the revised concept plan.

95 In an internal memorandum dated 14 August 2008, the Director-General of the Department of Planning and the Executive Director Rural and Regional Planning, both made the following recommendation: “That the Minister agrees to sign the attached Deed of Agreement and refer the Deed to the Minister for Environment and Climate Change for her endorsement”. The stated purpose of the memorandum was expressed as follows:

in exchange for development at Catherine Hill Bay and Gwandalan

96 The memorandum states that the deed is substantially consistent with the earlier memorandum of understanding. The memorandum also states:

“ The proportionality concept in the MOU has been removed - on rezoning and concept plan approval Rosecorp must transfer land to [Department of Environment and Climate Change] and [Lake Macquarie City Council]”.

97 On 22 August 2008, the Minister accepted a recommendation by the Director-General of his Department and by the Executive Director Strategic Sites and Urban Renewal, to recommend to the Governor the making of State Environmental Planning Policy (Major Projects) 2005 (Amendment No. 26) under s 39 (1) of the Act. The departmental briefing note states that the proposed developments at Catherine Hill Bay and Gwandalan contain uses that are classified as prohibited development under the relevant local environmental plans, that the site contains lands that are classified as “environmentally sensitive area of State significance”, and consequently the site must be rezoned before the proposed concept plan for the site is approved.

98 On 26 August 2008, Ms Kate Iffland of the Minister’s office, sent an email to Mr Brett Whitworth and Mr Michael File of the Department of Planning in the following terms:

“...I was wondering if you could help me work out when we could do an announcement for the transfer of the Rose Corp land to public ownership.

The Minister wants to do a ceremonial transfer of the land with the certificates of title handed over from Rose Corp to the Minister for Climate Change and the Environment.

The Deed says that upon rezoning of the land the relevant landowner is to immediately lodge the plan of subdivision for registration and within 5 working days (provided land and Property Information has issued the relevant certificates) the offset is to be transferred to he Minister for the Environment.

Would it be possible to estimate when the actual transfer will take place? If the Governor signs off on the rezoning on Wed and it is published in the gazette on Friday (and we announce the approval of the concept plan) and Rose Corp lodge a plan of subdivision on the same day would it be possible to do the actual transfer of certificates on the following Friday at the earliest?

99 On 27 August 2008, Ms Iffland sent a follow-up email to Mr Whitworth to which her previous email was attached and which states:

“ Have you heard back on this yet – need to make a call on how we announce all this stuff .”

100 State Environmental Planning Policy (Major Projects) 2005 (Amendment No. 26) was made by the Lieutenant-Governor and published in a Special Supplement of the Gazette on Tuesday, 2 September 2008. It identified the land to which it applies as a State significant site under State Environmental Planning Policy (Major Projects) 2005 and established appropriate zoning and controls for the proposed development at Catherine Hill Bay and Gwandalan.

101 On 1 September 2008, the Deed Regarding Lower Hunter Land Offsets was made between the Minister for Planning and the Minister for Climate Change and the Environment, (together, the “Government”), and Coastal Hamlets Pty Ltd (the “CHB landholder”) and Lakeside Living Pty Ltd (the “Gwandalan landholder”), together, (the “Landholders”). The deed recites that the Government intends to implement an Environmental Land Offset Scheme for the Lower Hunter region to complement and support the Lower Hunter Regional Strategy and the Lower Hunter Conservation Plan; that the parties entered into the MOU which sets out their intentions; and that the parties have agreed to enter into the deed as contemplated by the MOU.

102 The deed defines “Schedule 1 land” as “the parcels of land owned by the CHB landholder or the Gwandalan landholder referred to in the Lower Hunter Regional Strategy and identified in Schedule 1 or part thereof”. “Schedule 2 land” is defined as “the parcels of land owned by the CHB landholder and identified in Schedule 2 or part thereof”.

103 Clause 4 of the deed headed “Rezoning of Schedule 1 land” and is as follows:

“ Generally
4.1 Subject to clause 4.3 and the requirements of the [Environmental Planning and Assessment] Act, the Minister for Planning agrees to use reasonable endeavours to allow the Relevant Landholder to achieve development that is consistent with the Development Potential of Schedule 1 Land by:

(a) Rezoning the land through an amendment to State Environmental Planning Policy 2005 (Major Projects) and approval of the Concept Plan Application submitted under Pt 3A of the [Environmental Planning and Assessment] Act; and/or

(b) Facilitating the Rezoning of the land through the gazettal of a Local Environmental Plan prepared by the relevant local government authority and made by the Minister for Planning and approval of the Concept Plan Application submitted under Pt 3A of the [Environmental Planning and Assessment] Act; and/or
(c) any other means that achieves or encourages the more intensive use of the land;

in accordance with the Lower Hunter Regional Strategy and the Lower Hunter Regional Conservation Plan.

4.2 Subject to clause 4.3 and further to clause 4.1, as at the Commencement Date it is the Minister for Planning’s intention to allow the Relevant Landholder to achieve development that is consistent with the Development Potential of the Schedule 1 Land by Rezoning the land generally in accordance with the Draft [State Environmental Planning Policy] Extract.

No fetter
4.3 For the avoidance of doubt, nothing in this clause of this Deed should be taken to fetter the discretion of the Minister for Planning, or the discretion of the Minister for the Climate Change and the Environment, in exercising functions, including powers, authorities or duties, under the Environmental Planning and Assessment] Act or the [National Parks and Wildlife] Act, respectively.”

104 Clause 5.5 of the deed states:

“ 5.5 The Minister for Climate Change and the Environment acknowledges that the Landholders will be developing the Schedule 1 Land in accordance with a Rezoning and Concept Plan Approval .”

105 Clause 6 of the deed is headed “Transfer of Schedule 2 land”. Clause 6.1 is as follows:

“ 6.1 Upon the Rezoning of the Schedule 1 Land, the Relevant Landholder shall:

(a) immediately lodge the Plan of Subdivision for registration at Land and Property Information NSW; and

(b) as expeditiously as possible following the registration of the Plan of Subdivision (but no later than 5 working days following that registration provided Land and Property Information has issued the relevant certificates of title within such time) transfer the Environmental Offset to the Minister for Climate Change and the Environment, free from any mortgages or any other financial encumbrances but subject to the Leases, by providing a duly signed Transfer and the relevant certificates of title.”

106 Clause 11.18 is headed “Entire Deed” and states:

“ 11.18 This Deed constitutes the entire agreement and understanding between the parties as to the subject matter of this Deed. Any prior arrangements, agreements, representations or undertakings as to the subject matter of this Deed are superseded .”

107 As noted in par [97] and par [100] above, the Minister had earlier, on 22 August 2008, accepted a recommendation to make State Environmental Planning Policy (Major Projects) 2005 (Amendment No. 26), which had the effect of rezoning the Schedule 1 land so as to permit the proposed development at Catherine Hill Bay and Gwandalan, which instrument was published in a special supplement of the Gazette on Tuesday, 2 September 2008.

108 On the same day, 2 September 2008, the Minister granted the concept plan approval for Catherine Hill Bay and Gwandalan and the project approval for Gwandalan under s 75O and s 75J of the Act respectively.

109 The documents which were before the Minister when he granted the approval were:

(a) A memorandum dated 2 September 2008 signed by the Department’s Executive Director Strategic Studies and Urban Renewal, by the Director-General, and by the Minister;
(b) The Director-General’s environmental assessment report under s 75I of the Act, dated August 2008, which included the following appendixes:

(i) terms of approval for the concept plan under s 75O of the Act and terms of the approval of the project application under s 75J of the Act;

(ii) the Director-General’s environmental assessment requirements issued under s 75F of the Act;

(iii) further revised concept plan statement of commitments;

(iv) the interim report of the independent panel dated 13 April 2007;

(v) the final report of the independent panel dated 18 December 2007;

(vi) the preferred project report;

(vii) a summary of submissions, including of submissions by Rosecorp dated 29 August 2007; and

(viii) a summary of relevant environmental planning instruments and other legislation.

110 The memorandum (or briefing paper) of 2 September 2008 summarises the concept plan and project application, the key recommendations of the independent panel, the issues raised in public submissions, the public benefits of the proposals, and related matters being the MOU and the deed and the need for rezoning.

111 The Director-General’s report under s 75I of the Act summarises the previous history of the matter. The summary includes the following:

“ On 16 October 2006, a MOU was signed by the Proponent for the dedication of approximately 310 hectares of land for environmental conservation in exchange for the rezoning of the land at Catherine Hill Bay and Gwandalan to permit residential development covering up to 60 hectares to achieve 600 dwellings at Catherine Hill Bay and over 26 hectares to achieve 12 dwelling/ha at Gwandalan .”

112 Under the heading “Memorandum of Understanding” the Director-General’s report states:

“ Upon the rezoning of the Future Development Area, Coastal Hamlets Pty Ltd and Lakeside Living Pty Ltd will transfer ownership of the Proposed Dedicated Lands to the Minister for Climate Change and the Environment for dedication as a national park estate or a conservation reserve .”

113 Later in his report, the Director-General noted that the Department of Environment and Climate Change “in their submission stated that the majority of the lands identified for conservation offsets are eminently suitable for addition to the reserve system...”

114 On 3 September 2008, the Minister issued a media release announcing the approval of “scaled-down plans for a residential subdivision at Catherine Hill Bay and Gwandalan”. On 4 September 2008, an accredited certifier issued subdivision certificates under s 109C (1) (d) of the Act, and on 13 November 2008, certificates of title were issued for the land which was the subject of the subdivision certificates. On 26 November 2008, certificates of title were issued showing the transfer of the Schedule 2 land to the Minister Administering the National Parks and Wildlife Act.

Issue 1: Reasonable apprehension of bias

115 The question is, as noted at par [4] and par [48] above, whether a fair–minded lay observer, having knowledge of the material objective facts, might reasonably apprehend that the administrative decision-maker (the Minister) might not bring an impartial and unprejudiced mind to the determination of the applications. This in turn requires the identification of what it is that might lead the decision-maker to determine the applications other than on their legal and factual merits; and an articulation of the logical connection between the matter and a feared deviation from determining the applications on their merits: Ebner at [8].

116 The respondents, of course, submit that the “two mights" test described above does not apply to an administrative decision-maker who is also a Minister. However, for the reasons given at par [4] to [49] above, I reject the submission.

117 The following facts are relied upon by the respondents in support of their submission that there could not in any event be a reasonable apprehension of bias in the application of the “two mights” test:

(i) is expressly non-binding, but rather is an expression of intention: cl 2.2(a);

(ii) expressly states it is not to fetter the statutory discretions of the Minister: cl 2.2(b);

(iii) expressly states that it is not to constitute a representation, warranty or guarantee by or on behalf of the Government or its ministers: cl 2.2(c);

(iv) expressly states that the Minister’s intentions are to be carried out in accordance with the Lower Hunter Regional Strategy, the Lower Hunter Regional Conservation Plan, and to be subject to the requirements of the Act: cl 3.2;

(v) was to establish a framework within which the Government was willing to consider any proposal for the residential release of parts of the Lower Hunter region; and

(vi) enabled the proponent to commence the Pt 3A approval process, as to which the Minister had made no binding commitments but rather had merely agreed – whilst expressly not fettering his discretion - to use reasonable endeavours to allow the landholder to achieve the development potential of the Schedule 1 land.

(i) it constituted the entire agreement between the parties and supersedes any prior arrangements, agreements, representations or undertakings as to the subject matter of the deed: cl 11.18;

(ii) clauses 4.1 and 4.2 are expressly subject to cl 4.3 which states that nothing into the deed should be taken to fetter the discretion of the Minister in exercising the functions, powers, authorities or duties under the Act: cl 4.3;

(iii) the landholders’ obligation to transfer the Schedule 2 land is not contingent upon the approval of any concept plan: cl 6.1;

(iv) the Schedule 2 land is to be transferred to the Minister for Climate Change and the Environment, not the Minister for Planning: cl 6.1;

(v) the deed does not contain the equivalent of cl 4.4 of the MOU – the so-called proportionality clause; and

(vi) the deed does not stand alone and must be read in conjunction with the Lower Hunter Regional Strategy and the Lower Hunter Regional Conservation Plan: recital A.

(c) The Minister’s decisions were made under Pt 3A of the Act in the context of implementing the Environmental Offset Scheme set out in the Lower Hunter Regional Strategy, the Lower Hunter Conservation Plan, the MOU and the deed. In doing so, the Minister was not required to be completely neutral and was entitled to have a degree of predisposition in relation to the concept plan and project application. A relatively low degree of neutrality is to be expected of the Minister in making a decision under Pt 3A. There is nothing in the evidence to suggest that in making the decisions the Minister did not genuinely address himself to the statutory criteria, such as might cause a reasonable hypothetical observer to consider that the Minister might have failed to consider the applications with a mind open to persuasion. The Minister had the benefit of the two reports from the independent panel, the first of which led to changes in the proposal.

favourable disposition

118 In my opinion, however, the evidence shows that a fair minded lay observer, having knowledge of the material objective facts might reasonably apprehend that the Minister might not have brought an impartial and unprejudiced mind to the determination of the applications. The respondents, in their submissions concede that the Minister had “a favourable disposition” towards the development proposals in general terms, although they contend that he was entitled to do so. The concession that the Minister had a “favourable disposition” towards the applications is, however, an understatement of the Minister’s position.

119 The Minister took a lead role in the negotiations with Rosecorp from the beginning, as noted in the Department of Planning’s internal memorandum of 1 August 2006, and at a time when there was no identification of either the Gwandalan land or the Catherine Hill Bay land in the draft Lower Hunter Regional Strategy, as being new release areas or future investigation area.

120 The Minister’s commitment towards the proposals before entering into the MOU and, importantly, before the Pt 3A process had been commenced, let alone completed and before receiving the report of the Director-General which he was required to consider under s 75O(2)(a) of the Act, is demonstrated by the Department of Planning’s letter to the Crown Solicitor’s Office on 28 September 2006. That letter states, in relation to the drafting of the MOU that it “will be drafted on the basis that the Minister will use his best endeavours to ensure that the contents of the MOU will be achieved” (emphasis added).

121 The Minister’s commitment found expression in the October 2006 draft Lower Hunter Regional Conservation Plan, noted above, which includes a statement that “legally enforceable agreements are being entered into” to transfer privately owned land to the Minister for the Environment “in exchange for appropriate development rights”. Again, this was before the suitability of any of the subject land for development had been assessed.

122 The Minister’s commitment to the whole land offset scheme again found expression in the press release which accompanied the release of the final version of the Lower Hunter Regional Strategy on 17 October 2006, which states that another 12,000 hectares of privately owned land “will be transferred” to public ownership (emphasis added). And the strategy itself states that areas of high conservation values “will be dedicated to the Government” (again, emphasis is added).

123 The MOU, although stating that it is not to be taken to fetter the discretion of the Minister under the Act, also states that it is intended to express the parties “firm intentions” with respect to the matters with which it deals: cl 2.2(a). I accept the submission of counsel for the Action Group that the Minister thus publicly committed himself to a particular outcome and indicated a disposition to achieving a particular type of result, namely, the specified development potential. The logical connection between this and the feared deviation from the course of deciding the applications on their merits is that by attaching himself to an incentive which would not otherwise exist in that form he limited his freedom to determine the applications purely on their merits. That is, far from bringing an impartial mind to his determination, the Minister committed himself to bringing a partial mind to the applications. Again, this was done before the Pt 3A process had been commenced, let alone completed. The existence of the commitments in the MOU thus, by itself, gives rise to a reasonable apprehension of bias, even although it is expressed as not fettering the discretion of the Minister under the Act.

124 I also accept the submission of counsel for the Action Group, since it is self-evident, that the MOU had an effect on and was taken into account during the whole of the planning process that then followed.

125 What is relevant is the reaction of the fair-minded lay observer to the commitments made by the Minister in not only the MOU but also the deed. As counsel for the Action Group rhetorically ask: what reason was there for the Minister to make the commitments that he did if they did not have significance in the decision-making process and could not be expected to influence the Minister’s exercise of his powers? The fact that these commitments may not have been legally enforceable does not mean that they were not commitments solemnly made by the Minister and which, presumably, he would intend to honour. The assumption by a decision-maker of an undertaking, whether contractually binding or not, to exercise a statutory discretion in a particular way, may found a conclusion of apprehended bias.

126 The Minister’s intention was again firmly expressed in his letter of February 2007 to Mr Coombs, in which he states that the agreements reached with Coal and Allied and Rosecorp “will” see significant areas of waterfront land at Lake Macquarie made available to the public, and that this “is” a fantastic win for the local residents.

127 The fact that the approvals were to be granted in exchange for the provision of land is confirmed by the memorandum of 14 August 2008, noted in par [95] above; and the fact that the transfer of the Schedule 2 land was dependent upon and conditional upon the rezoning which would also allow the approvals, is also confirmed by the same memorandum, noted in par [96] above.

128 The Minister’s intention was made very clear in the deed. It was his expressed intention “to allow the Relevant Landholder to achieve development that is consistent with the Development Potential of the Schedule 1 land”: cl 4.2. That is, the fair-minded lay observer might readily think that the Minister had already pre-determined his determination before receiving and considering the Director-General’s report on the proposal as he was required to do by s 75J (2)(a) and s 75O. Although cl 4.2 goes on to say that this was to be achieved by rezoning the land, that was part of the package necessary for the Minister to make good on his commitments.

129 Although the deed states that it is not to fetter the discretion of the Minister under the Act (cl 4.3), the Minister acknowledged that the landholders “will” be developing the Schedule 1 land in accordance with the rezoning and the concept plan approval (cl 5.5).

130 The fair-minded lay observer might reasonably apprehend that cl 5.5 manifests an assumption that approval would be given to the concept plan application by the Minister, or that at least some development would take place on the Schedule 1 land. That is, the fair minded lay observer might reasonably apprehend that the Minister might not bring an impartial and unprejudiced mind to this decision, particularly since, as already noted in par [128] above, he had not yet received and considered the Director-General’s report.

131 The email of 26 August 2008 from Ms Iffland of the Minister’s office to Messrs Whitworth and File of the Department of Planning demonstrates to the fair-minded lay observer the Minister’s enthusiastic commitment to the proposals: “The Minister wants to do a ceremonial transfer of the land with the certificates of titles handed over from Rosecorp to the Minister for Climate Change and the Environment”. The Minister wanted the transfer of certificates to take place on the following Friday after the rezoning was published in the Gazette. That the Minister was anxious to do this is further demonstrated by the follow-up email the next day: “Have you heard back on this yet – need to make a call on how we announce all this stuff”.

132 Moreover, the whole rezoning was brought forward in an unusually expedited manner by publication in a Special Supplement of the Gazette on Tuesday, 2 September 2008; and on the same day the Minister approved the concept plan and the project application.

133 The fair-minded lay observer might thus have apprehended that the Minister might not bring an impartial and unprejudiced mind to his determination of the applications, since he seemed to be enamoured with the whole proposal of a land-bribe in exchange for rezoning and associated development; again, it is to be noted, before receiving and considering the Director-General’s report.

134 The respondents nevertheless again rely upon CREEDNZ Inc v Governor-General in support of a submission that public statements made by ministers did not necessarily mean that they had predetermined, in that case, the advice they gave to the Governor-General in Council. In that case, an agreement in principle had been reached and a memorandum of intent was signed by the Minister for Energy on behalf of the Government for a smelter project in the South Island. There had also been public statements by ministers in the press endorsing the project. I have already distinguished this case from the present. The determination of the Minister for Planning in the present case was made in his capacity as an administrative decision-maker and not, as in CREEDNZ, at the governmental level of an Order in Council, being the very apex of governmental structure, and where the proposal was a major work in the national interest and which qualified within the meaning of the National Development Act 1979 (NZ) as essential for the purpose of the development of New Zealand’s natural resources, the nation’s self-sufficiency in energy, or the major expansion of exports, or the development of significant opportunities for employment. The Court held that, at that level, an assumption that the Governor-General in Council may be predisposed to apply the provisions of the National Development Act is not enough to establish apprehended bias and it is not expected that ministers could approach their consideration of an application under the National Development Act with perfect detachment.

135 Of greater relevance to the present case is the decision of the New Zealand Court of Appeal in Lower Hutt City Council v Bank, discussed at par [39] and par [40] above. This case provides a complete answer to the submission that the deed did not bind the Minister to approve the development. In that case the Council was required by statute to “inquire into and dispose of” any objection to the particular proposal. The agreement by the Council with the developer to “take all steps necessary” to further the proposal nevertheless indicated a real possibility of prejudgment – that is, “it appears to right-thinking people that the authority is no longer able to discharge its statutory duty with fairness”.

136 Similarly, in R v Corporation of the City of Marion; Ex parte Independent Grocers Co-operative Ltd (No. 2) (1984) 37 SASR 436; (1984) 59 LGERA 244, entry by a council into an agreement with a developer to do everything necessary to transfer land constituted by a road, on the assumption that it would be closed, was held by the Full Court of the Supreme Court of South Australia to give rise to a reasonable apprehension of bias in the Council’s consideration of the developer’s subsequent application for closure of the road, notwithstanding the fact that the Council was required by statute to publicly notify the proposed road closure and to consider any objections, which it did.

137 I also respectfully adopt the reasoning of Biscoe J in Bonaccorso, discussed at par [37] and par [38] above, in which his Honour applied the same principles in finding that the hypothetical observer might reasonably apprehend that the Council in that case might not bring an impartial mind to the determination of an exercise of a statutory discretion.

138 Finally, I note that neither the MOU nor the deed was a planning agreement to which s 93F to s 93L of the Act apply, and neither of the respondents sought to rely upon those provisions.

139 The conclusion that the ground of reasonable apprehension of bias is established in this case means that the relief claimed must be granted and declarations must be made that the impugned determinations of the Minister are invalid. The respondents have not advanced any discretionary reasons why the Court should refuse to grant the relief sought. This conclusion also means that it is not necessary to consider the second ground of challenge raised by the Action Group, namely that the Minister impermissibly took into account irrelevant considerations in determining the applications under s 75J and s 75O of the Act. Nevertheless, since the second ground was argued, I should briefly indicate my conclusions thereon.

Issue 2: Irrelevant considerations

140 Although s 75J and s 75O of the Act set out mandatory relevant considerations, there was nothing in those sections that expressly prevented the Minister from taking any other matter into account. The mandatory considerations were: (a) the Director-General’s report on the project and the reports, advice and recommendations contained in the report; (b) if the proponent is a public authority – any advice provided by the Minister having portfolio responsibility for the proposal; and (c) if the Minister has directed an inquiry be held in accordance with s 119 with respect to the project – any findings or recommendations of the Commission of Inquiry.

141 The matters which the Minister may take into account may thus be unconstrained “except in so far as there may be found in the subject-matter, scope and purpose of the statute some implied limitation on the factors to which the decision-maker may legitimately have regard”: Minister for Aboriginal Affairs v Peko Wallsend Ltd (1986) 162 CLR 24 at 40 per Mason J.

142 Mr J K Kirk and Mr G E S Ng, appearing for the Action Group, note that the Minister has admitted, in the amended points of defence, that he took into account and thus had regard to the terms of the MOU and the terms of the deed, the latter reflecting his preferred outcome of the negotiations, namely a commitment on his part to use reasonable endeavours to approve the concept plan coupled with an assurance that the 310 hectares of offset land would be transferred to the Minister for the Environment upon rezoning of the Catherine Hill Bay and Gwandalan sites. Both the MOU and the deed involved commitments made before the Minister received the critical document for the purpose of his determination, namely, the Director-General’s report.

143 Mr Kirk further submits that the solemn commitments made in the two documents represent an invalid fetter on the Minister’s discretionary power, citing Ansett Transport Industries (Operations) Pty Ltd v The Commonwealth (1977) 139 CLR 54 at 75-76. In that case Mason J said:

Ransom & Luck Ltd v Surbiton Borough Council

Southend-on-Sea Corporation v Hodgson (Wickford) Ltd

Rocca v Ryde Municipal Council

144 Mr Kirk submits that the Minister was obliged under the Act to consider the applications on their merits taking account of the Director-General’s report and associated material, regardless of any pre-existing commitment as to how the discretion should be exercised and which were entered into before the relevant process under Pt 3A of the Act had taken place, thus undermining the proper operation of the Act. It is possible, in Mr Kirk’s submission, that the Minister would have reached a different conclusion if he had not taken account of the commitments he had already made and the provisions to which he had made himself a party, the appropriate test being one of possibility and not probability (citing Lu v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCAFC 340; (2004) 141 FCR 346 at [6], [64] and [104]).

145 I have noted that neither the MOU nor the deed could be regarded as a planning agreement to which s 93F to s 93L apply. As Mr Kirk noted, the Parliament has recognised the danger that this sort of agreement can subvert the proper operation of the planning and assessment process by providing built-in safety procedures, most notably in s 93G - the public notification, the 28 days inspection period and the associated right to make submission.

146 Although the Minister’s discretion is apparently unconfined, I accept that there may still be found in the subject matter, scope and purpose of the statute some implied limitation on the factors to which the decision-maker may legitimately have regard: Peko Wallsend at 40, noted at [141] above. The MOU and the deed in the present case are in substance a sort of planning agreement, but neither of which comply with the planning agreement provisions and safeguards. The presence of the statutory scheme for planning agreements suggests that these types of arrangements have no place consistently with the statutory scheme; that is, the statute imposes a limitation on the factors to which the decision-maker may have regard which excludes a consideration of such arrangements.

147 I find that there is the implied limitation, notwithstanding the submissions of the respondents that the Minister has a wide-ranging responsibility under s 7 of the Act to promote the objects of the Act; including, in particular, the provision of land for public purposes: s 5(a)(iv), and notwithstanding the further submissions that the MOU and the deed were consistent with the subject matter, scope and purpose of the Act.

148 I therefore accept the submissions of Mr Kirk, noted in par [142] to [145] above, and find that by taking into account the existence of both or either of the MOU and the deed, the Minister took into account irrelevant considerations.

Conclusion and orders

149 It was, of course, only necessary for the Action Group to establish one of its two causes of action, but it has succeeded on both causes of action. Having found that the Minister’s approval of the concept plan and his approval of the project application were affected by a reasonable apprehension of bias and that he also took into account irrelevant considerations in his determination of both applications, it follows that the relief claimed by the Action Group should be granted. No submissions have been put as to why, in the event of such finding, the relief claimed should not be granted. Finally, I should note that the actions of the Minister which are impugned are not those of the present Minister, but the previous holder of that office.

150 I make the following declarations and orders:

(1) A declaration that the concept plan approval MP06_0330 for residential development at Catherine Hill Bay granted by the first respondent on 2 September 2008 under s 75O of the Environmental Planning and Assessment Act 1979 is void and of no effect.

(2) An order quashing the said concept plan approval.

(3) A declaration that the project approval MP07_0107 for the development in Kanangra Drive, Gwandalan for the subdivision of lot 3 in deposited plan 588206 into 187 residential lots and one residue lot and associated works granted by the first respondent on 2 September 2008 under s 75J of the Environmental Planning and Assessment Act 1979 is void and of no effect.

(4) An order quashing the said project approval.

(5) An order that the respondents pay the applicant’s costs.

(6) The exhibits may be returned.

I hereby certify that the preceding 150 paragraphs are a true copy of the reasons for judgment herein of the Honourable Mr Justice D H Lloyd.

Associate

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Citations

Gwandalan Summerland Point Action Group Inc v Minister for Planning [2009] NSWLEC 140

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CITATION:	Gwandalan Summerland Point Action Group Inc v Minister for Planning [2009] NSWLEC 140
PARTIES:	Gwandalan Summerland Point Action Group Inc (Applicant) Minister for Planning (First Respondent) Rose Property Group Pty Ltd (Second Respondent) Lakeside Living Pty Ltd (Third Respondent)
FILE NUMBER(S):	41214 of 2008
CORAM:	Lloyd J
KEY ISSUES:	JUDICIAL REVIEW :- decisions made by Minister for Planning - rezoning of land - concept plan approval - project approval - apprehended bias - irrelevant considerations - pre-existing agreements entered by Minister requiring him to use reasonable endeavours to implement an environmental land offset scheme, approve proposed land rezoning and approve a concept plan BIAS :- apprehended bias - test for - Minister of the Crown - decisions were administrative and not made in the exercise of political functions - actions of Minister and pre-existing agreements with developers regarding environmental land offset scheme held to give rise to reasonable apprehension of bias
LEGISLATION CITED:	Environmental Planning and Assessment Act 1979 Pt 3A s 75A, s 75B, s 75D, s 75E, s 75F, s 75G, s 75H, s 75I, s 75J, s 75M, s 75N, s 75O and s 75R, Pt 4 Div 6 and Div 6A State Environmental Planning Policy (Major Projects) 2005 Sch 2 cl 1(1)(i)
CASES CITED:	Ansett Transport Industries (Operations) Pty Ltd v The Commonwealth (1977) 139 CLR 54 CREEDNZ Inc v Governor-General [1981] 1 NZLR 172 Ebner v Official Trustee in Bankruptcy [2000] HCA 63; (2000) 205 CLR 337 F & D Bonaccorso Pty Ltd v City of Canada Bay Council (No. 2) [2007] NSWLEC 537; (2007) 158 LGERA 250 Franklin v Minister of Town and Country Planning [1948] AC 87 Hot Holdings Pty Ltd v Creasy [2002] HCA 51; (2002) 210 CLR 438 Johnson v Johnson [2000] HCA 48; (2000) 201 CLR 488 Laws v Australian Broadcasting Tribunal (1990) 170 CLR 70 Livesey v New South Wales Bar Association (1983) 151 CLR 288 Lower Hutt City Council v Bank [1974] 1 NZLR 545 Lu v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCAFC 340; (2004) 141 FCR 346 McGovern v Ku-ring-gai Council [2008] NSWCA 209; (2008) 161 LGERA 170; (2008) 251 ALR 558 Mid Western Community Action Group Inc v Mid- Western Regional Council (No. 2) [2008] NSWLEC 143 Minister for Aboriginal Affairs v Peko Wallsend Ltd (1986) 162 CLR 24 Minister for Immigration & Multicultural Affairs v Jia Legeng [2001] HCA 17; (2001) 205 CLR 507 Old St Boniface Residents’ Association Inc v City of Winnipeg [1990] 3 SCR 1170 R v Commonwealth Conciliation and Arbitration Commission; Ex parte Angliss Group (1969) 122 CLR 546 R v Corporation of the City of Marion; Ex parte Independent Grocers Co-operative Ltd (No. 2) (1984) 37 SASR 436; (1984) 59 LGERA 244 Re MacTiernan; Ex parte Coogee Coastal Action Coalition Inc [2004] WASC 264 Re MacTiernan; Ex parte Coogee Coastal Action Coalition Inc [2005] WASCA 109; (2005) 30 WAR 138 South Australia v O’Shea (1987) 163 CLR 378 Webb v The Queen (1994) 181 CLR 41 Williams v Director General of the Department of Environment and Conservation [2004] NSWLEC 613
TEXTS CITED:	Aronson et al, Judicial Review of Administrative Action, 4th ed (2009) Lawbook Co
DATES OF HEARING:	9 June 2009, 10 June 2009 and 11 June 2009
DATE OF JUDGMENT:	31 August 2009
LEGAL REPRESENTATIVES:	APPLICANT: J K Kirk (barrister) and G E S Ng (barrister) SOLICITORS: Environmental Defender's Office FIRST RESPONDENT: J E Griffiths SC, S J Free (barrister) and C C Spruce (barrister) SOLICITOR: Christine Hanson Department of Planning SECOND AND THIRD RESPONDENTS: M J Leeming SC and I J Hemmings (barrister) SOLICITORS: Corrs Chambers Westgarth