Honner v Yorke Peninsula Council
[2015] SADC 156
•28 October 2015
DISTRICT COURT OF SOUTH AUSTRALIA
(District Court Administrative and Disciplinary Division: Minor Civil Review)
HONNER v YORKE PENINSULA COUNCIL
[2015] SADC 156
Judgment of His Honour Judge Brebner
28 October 2015
INTERPRETATION - GENERAL RULES OF CONSTRUCTION OF INSTRUMENTS - GIVING EFFECT TO MANIFEST INTENTION
Applicant sought to challenge validity of administrative acts as an incident to primary objective of proceedings in a minor civil action - Whether Magistrates Court had jurisdiction over subject matter of challenge - Circumstances in which collateral challenge might be permitted - Whether Court had discretion to refuse to permit collateral challenge to proceed.
Held: Magistrates Court had no jurisdiction over subject matter of challenge and collateral challenge not available - Alternatively Magistrates Court had discretion to refuse to permit challenge. Challenge should not be permitted - Magistrates Judgment affirmed.
Local Government Act (1999) s3, s146, s155, s76; Magistrates Court Act 1991 s8, s10, s30, s32 s38(6), s38(7); District Court Act 1991; Environment Resources and Development Court Act 1993 s28, referred to.
Ousley v The Queen (1997) 192 CLR 69; Jacobs v OneSteel Manufacturing Pty Ltd and WorkCover Corporation of South Australia (2006) 93 SASR 568; Hinton v Lower (1971) 1 SASR 522; R v Scarpantoni (2013) 118 SASR 131; Project Blue Sky v Australian Broadcasting Authority (1998) 194 CLR 355; Eastern Districts Azzurri Sports Club Inc v Harley (1997) (Unreported) District Court Judgment No D3628; State of South Australia v Lampard-Trevarrow (2010) 106 SASR 331; Forster v Jododex Aust Pty Ltd (1972) 127 CLR 421; Keane v Salisbury City (1995) 87 SGERA 203, considered.
WORDS AND PHRASES CONSIDERED/DEFINED
"COLLATERAL CHALLENGE"
HONNER v YORKE PENINSULA COUNCIL
[2015] SADC 156
This is an application to review a minor civil action.
The applicant owns a property on the Yorke Peninsula. The respondent is the Yorke Peninsula Council. The respondent imposed an annual waste and recycling service charge on all properties in its district. The applicant refused to pay the charge for four successive financial years.
The respondent commenced proceedings in the Magistrates Court to recover the accumulated arrears. The proceedings were a minor civil action. The applicant denied the claim but admitted he had not paid the charges.
The respondent applied for summary judgment. In response the applicant challenged the validity of the charges and he contended that an amendment to the Local Government Act 1999 (LGA) relieved him from liability to pay the whole of the charge for the last of the relevant financial years. For reasons I will come to the Magistrate concluded that she had no jurisdiction to determine the validity of the charges and that the applicant’s contention about the amendment was wrong in law. She concluded that the applicant had no defence on the merits and she entered judgment for the respondent in the amount of $998.42 plus costs of $285.75.
The applicant seeks a review of the proceedings. The review is dismissed and the Magistrate’s judgment is affirmed. My reasons follow. All empathises will be mine, all citations have been omitted from quotations, I will refer to the Magistrates Court as “the Court” whenever I can and I will use the expressions “service charges” and “charges” interchangeably.
Background
In August 2008 the respondent resolved to collect the waste in its town service areas and to establish collections points in its rural service areas where ratepayers could deliver their waste. It further resolved to levy an annual charge against all rateable properties for the provision of these services.
The applicant’s property is rateable. It lies in the respondent’s rural service area.
Notice of the resolutions imposing the service charges and of the amount of each successive annual charge was published in the Government Gazette. The relevant financial years are the financial years ending 30th June 2009 - 30th June 2012.
The respondent had all the statutory power it needed to impose the charges.
An amendment to s 155 LGA (the amendment) came into operation in December 2012. The amendment provided that service charges for properties in the rural service areas were to be determined by reference to the distance between each rateable property and the nearest collection point.
In each of the relevant financial years the applicant paid his rates but not his service charge.
The applicant is over 70 years of age. He does not live on the property and it rarely generates any waste. Availing himself of the waste collection service would have involved the applicant in a round trip of some 95 kilometres from where he lives.
The respondent applied the applicant’s payments of his rates in the manner required by s 183 LGA. The relevance of this will become apparent.
The applicant made three applications to have his charges remitted. The respondent rejected each application.
Claim
The respondent commenced proceedings in 2013. Its claim was for “rates and fines” plus interest and costs. The claim was a minor civil action.
The applicant filed a defence and a counterclaim. The counterclaim was ultimately abandoned on the hearing of the review.
The respondent applied for summary judgment. The applicant resisted the application. He contended that the service charges were invalid and that he was under no obligation to pay them. He thus called on the Magistrate to determine the validity of the charges as an incident to her determination of the primary issue of whether he had a good defence on the merits.
The Magistrate concluded that the Magistrates Court Act 1991 (MCA) did not confer jurisdiction on the Court to determine the validity of service charges and that the LGA conferred exclusive jurisdiction on the District Court to do so. She also concluded that the applicant’s contention about the amendment failed because it had no retrospective effect. She ultimately concluded that the applicant had no defence on the merits and she entered summary judgment in favour of the respondent accordingly.
Grounds for review
The applicant complains that the Magistrate erred in determining that the Magistrates Court had no jurisdiction to determine the validity of the charges and that she should have found that they were invalid.
Minor civil reviews
Sections 38(6) and 38(7) MCA set out the principles governing minor civil reviews. In summary they provide inter alia, that the review is of the whole of the proceedings including the Magistrate’s reasons, that in conducing the review I must act according to equity, good conscience and the substantial merits of the case without regard to technicalities and legal forms and that I may affirm the Magistrate’s judgment or rescind it and substitute any other judgment I consider to be appropriate.
However, neither s 38 MCA, nor the District Court Act 1991, confer any jurisdiction on me to substitute a judgment which the Magistrate had no jurisdiction to make.
Issues
The issues on review distil down to two questions:
·Does the Magistrate’s Court have jurisdiction to determine the validity of service charges?
·If so, should the Court nonetheless decline to permit the challenge as an exercise of discretion?
Issues of statutory construction will be involved.
Preliminary issue
Counsel for the respondent, Mr Henry SC raised a preliminary issue based on s 183 LGA which, in his submission, foreclosed the matter. Section 183 relevantly provides:
183 – Application of money in respect of rates
If a council receives or recovers an amount in respect of rates, the amount will be applied as follows:
…
(d) fourthly – in satisfaction of liabilities for rates in the order in which those liabilities arose.
Mr Henry submitted that s 183 dictated that the applicant’s payments of his rates were to be applied first to his accumulated unpaid service charges and that his rates were then to be regarded to be in arrears and that this rendered his defence irrelevant. In my view the mere fact that s 183 specifies the way in which payments of rates are to be applied cannot operate so as to prevent a ratepayer from asserting that he was under no financial obligation to his council in relation to service charges in the first place. The submission is rejected.
Collateral challenge
The nature of a collateral challenge and the circumstances in which a court might entertain a challenge must be identified before proceeding further.
In Ousley v The Queen (1997) 192 CLR 69 McHugh J explained the nature of collateral challenge in these terms at 98-99:
A collateral attack on an act or decision occurs when the act or decision is challenged in proceedings whose primary objective is not the setting aside of or modification of that act or decision. In In re Preston however, Lord Scarman used the term “collateral challenge” to include any process challenging a decision – including an application for judicial review – other than a proceeding by way of appeal. The use of the term is readily intelligible. However, with the widespread availability of judicial review procedures, it conduces to clarity of thought, in my opinion, if the term “collateral challenge” is confined to challenges that occur in proceedings where the validity of the administrative act is merely an incident in determining other issues.
I take this to be the operative definition of “collateral challenge”.
The applicant sought to challenge the validity of the charges before the Magistrate incidentally to his contention that the respondent could not discharge its onus to demonstrate that he did not have a good defence on the merits. His challenge thus satisfies McHugh J’s definition.
It is settled that a court cannot permit a collateral challenge unless it has the jurisdiction necessary to determine the subject matter: Jacobs v OneSteel Manufacturing Pty Ltd and WorkCover Corporation of South Australia (2006) 93 SASR 568 at [68] per Besanko J, (Duggan, Vanstone and Layton JJ agreeing). If a court has jurisdiction to determine a challenge, it is nonetheless necessarily implicit in the reasons of Besanko J at [91]-[94] that it may refuse to permit the challenge as an exercise of discretion. Counsel for the applicant, Mr Hayes QC, did not contend otherwise.
Subject matter
The subject matter of the challenge is the validity of the charges and the validity of the administrative acts performed by the respondent in imposing them and, perhaps, the validity of the respondent’s administrative acts in refusing to remit them.
Service charges
The respondent’s power to impose service charges forms part of the context in which some of the issues of construction fall to be determined.
Section 146 LGA confers a general power on councils to impose service charges and s 155 LGA identifies the nature of the service charges which can be imposed. These sections provide as follows:
146 – Rates and charges that a council may impose
A council may impose rates and charges of the following kinds on land within its area:
…
(d) Service charges
155 – Service rates and service charges
(1) In this section –
“prescribed service” means any of the following services:
…
(b) the collection, treatment or disposal (including by recycling) of waste;
…
(2) A council may impose -
(a) A service rate, an annual service charge, or a combination of a service rate and an annual service charge, on rateable land within its area to which it provides, or makes available, a prescribed service;
…
(8) A service charge imposed by a council under this section is recoverable as if it were a rate (even as against non-rateable land).
It is clear from these provisions that the relevant service charges are within the ambit of s 155 and that the respondent thus had the power to impose them.
Jurisdiction of the Magistrates Court
This brings me to the fundamental issue of whether the Magistrates Court enjoys jurisdiction to determine the subject matter of the challenge, namely the validity of the charges.
The Court is established by s 4 MCA. The relevant jurisdictional provisions are sections 8, 10, 30 and 32. Section 8 confers the Court’s civil jurisdiction. Section 10 provides for other statutory jurisdiction. Section 30 provides that equitable claims and defences may be included in the same action and s 32 confers jurisdiction to grant declaratory relief.
Neither the MCA nor any other Act expressly confers jurisdiction on the Court to determine the validity of service charges.
Mr Hayes submits that the jurisdictional provisions of the MCA nonetheless confer jurisdiction on the Court to determine the validity of service charges in the sense that its jurisdictional provisions vest power in the Court to conduct and determine proceedings which are, to adopt and adapt the expression used by Bray CJ in Hinton v Lower (1971) 1 SASR at 522, “appropriate to the purpose” of determining the validity of the charges and the underlying administrative acts.
Mr Henry submits that the jurisdictional provisions of the MCA must be read in the light of s 276 LGA. He submits that the effect of s 276 is to confer exclusive jurisdiction on the District Court to determine the validity of charges. He submits that the Magistrates Court thus has no jurisdiction whatsoever to determine the subject matter of the charges.
It will be convenient first to consider the construction of s 276 LGA and to then move on to the jurisdictional provisions of the MCA and the question of whether s 276 LGA limits or erodes the jurisdiction that the Court would otherwise enjoy.
Principles of construction
The relevant principles of construction were recently identified and summarised by Kourakis CJ in R v Scarpantoni (2013) 118 SASR 131 where his Honour said at [18]-[23]:
“The adoption of a purposive construction is the usual or general approach to be taken to issues of statutory construction. A purposive approach to statutory construction is also prescribed by section 22(1) of the Acts Interpretation Act 1915 (SA):
[W]here a provision of an Act is reasonably open to more than one construction, a construction that would promote the purpose or object of the Act (whether or not that purpose or object is expressly stated in the Act) must be preferred to a construction that would not promote that purpose or object.
In Palgo Holdings Pty Ltd v Gowans, Kirby J made the following observations in relation to purposive construction:
... a purposive and not a literal approach is the method of statutory construction that now prevails:
“A search for the grammatical meaning still constitutes the starting point. But if the grammatical meaning of a provision does not give effect to the purpose of the legislation, the grammatical meaning cannot prevail. It must give way to the construction which will promote the purpose or object of the Act.
Courts are no longer satisfied with a literal or grammatical meaning of words that does not conform to the presumed legislative intention, including the policy that can be discerned from the law in question. As Lord Diplock explained, in an extra-judicial comment, “if... the Courts can identify the target of Parliamentary legislation their proper function is to see that it is hit: not merely to record that it has been missed.
The importance of context as an aid to statutory construction was noted by Kirby J in Palgo Holdings v Gowans:
... the meaning of words in legislation is not derived by taking a word in isolation and construing it as if it existed in a vacuum. In the law, context is critical. In a statute, a word (if undefined) normally takes its meaning from the surrounding text. Isolating a word ... and affording it meaning torn from its context is a discredited approach to interpretation, given the way that language is ordinarily used and understood by human beings.
…
Statutory interpretation requires the court to have regard to the context in which the words to be interpreted arise and also their statutory purpose. Context includes “the existing state of the law and the mischief which, by legitimate means ... one may discern the statute was intended to remedy.”
Section 276 LGA
The objects of the LGA include encouraging local government to provide services to meet the needs of their communities: s 3(f) LGA.
The apparent purposes of s 276 LGA are to provide a mechanism for challenging the validity of service charges and to confine the right to bring alternative proceedings to rights which are expressly conferred by statute.
The relevant terms of s 276 are as follows:
276 – Special Jurisdiction
(1) The following proceedings may be taken before, and determined by the District Court:
…
(e) Proceedings to try the validity of a … service charge;
(2) The proceedings may be brought by-
…
(b) an elector
…
(d)any other person with a material interest in the matter
…
(4) Proceedings under subsection (1)(e) must be commenced within two months from the date of publication of the notice of the declaration of the … service charge in the Gazette.
(5) The District Court may make an order –
...
(d) Quashing a rate of service charge which is invalid.
…
(7) Except to the extent that this or another Act provides an express right to bring particular proceedings, no proceedings may be brought before a court or tribunal constituted by law …
(c) to challenge a … service charge …
...
Section 276(1)(e) and 276(2) confer a right on two identified classes of persons to bring proceedings in the District Court to try the validity of service charges. Section 276(5)(d) confers jurisdiction on the District Court to quash any charge which is invalid. Section 276(4) imposes a short limitation period. Significantly for present purposes, s276(7)(c) prohibits the institution of any other proceedings to challenge charges unless an express right to do so is conferred by the LGA or some other Act. I will refer to s 276(7)(c) as “the prohibition.”
The objects of the limitation on who may bring proceedings to try the validity of charges in the District Court are self-evident. The apparent object of the relatively short limitation period is to obviate budgetary uncertainty for councils. The apparent objects of the prohibition are to preserve the integrity of the limitation period and the benefits it confers on councils, to ensure that challenges are only conducted in courts or tribunals that possess appropriate expertise and procedures, and to prevent forum shopping, multiplicity of actions and potentially inconsistent decisions.
In its terms the prohibition specifically limits the right to bring proceedings to challenge charges to rights which are expressly conferred by the LGA or some other Act. The expression employed in s 276(7) is “an express right” and Parliament must have intended the expression to have some purpose to serve. The expression does not have any technical or legal significance and Parliament has not provided a definition, it must therefore be taken to have intended the words to have their ordinary meaning in the context in which they it appear.
In this regard the reasons of McHugh, Gummow, Kirby and Hayne JJ in Project Blue Sky v Australian Broadcasting Authority (1998) 194 CLR 355 are instructive. At [78] their Honours said:
However, the duty of a court is to give the words of a statutory provision the meaning that the legislature is taken to have intended them to have. Ordinarily, that meaning (the legal meaning) will correspond with the grammatical meaning of the provision. But not always. The context of the words, the consequences of a literal or grammatical construction, the purpose of the statute or the canons of construction may require the words of a legislative provision to be read in a way that does not correspond with the literal or grammatical meaning.
The Concise Oxford Dictionary defines “express” as “definitely stated, explicit.” In the context of the prohibition, an express right to challenge a charge must be taken to mean a right to do so which is precisely defined or identified rather than one which arises by necessary implication from the terms of a provision the LGA or some other Act.
It is to be observed that the prohibition confines the right to bring proceedings to challenge the validity of charges to those on whom an express right to do so is conferred. It does not confine the jurisdiction over charges to courts or tribunals on which an express jurisdiction is conferred.
It follows that by focusing on the right to invoke jurisdiction rather than on the conferral of jurisdiction, Parliament must have recognised that some courts enjoy the jurisdiction to conduct proceedings which are appropriate to the determination of the validity of charges and, in the light of this, it must have intended to restrict the right to invoke any such jurisdiction for the purpose of challenging charges to those on whom a right to do so is expressly conferred. It follows that Parliament must have intended that service charges were to be challenged in proceedings brought in the District Court by virtue of s 276(1)(e) LGA, or in proceedings brought by those on whom a right to do so is conferred in precisely defined terms by the LGA, or some other Act, or not at all. Indeed if Parliament had intended otherwise it would have expressed the prohibition in terms of jurisdiction to entertain and determine challenges.
Jurisdiction and service charges
The jurisdictional provisions of the MCA must now be considered in the light of the prohibition. The relevant sections provide as follows:
8—Civil jurisdiction
(1) The Court has jurisdiction –
…
(d) to grant any form of relief necessary to resolve a minor civil action.
...
10—Statutory jurisdiction
(1) The Court has any jurisdiction conferred on it by statute.
...
30—Law and equity
(1) Legal and equitable claims and defences may be included (without discrimination between them) in the same action.
(2) If there is a conflict between the rules of common law and equity as they apply to a particular action, the rules of equity prevail.
32—Declaratory judgments
The Court may, on matters within its jurisdiction, make binding declarations of right whether or not any consequential relief is or could be claimed.
Section 8 MCA does not specifically confer jurisdiction on the Court to determine the validity of service charges or of administrative acts performed in the exercise of a power conferred by statute. Section 10 provides that the Court has any jurisdiction conferred on it by statute. As I have observed, neither the MCA nor other Act confers jurisdiction on the Court to determine the validity of charges or administrative acts.
Section 8(1)(d) MCA)
Mr Hayes submitted that the terms s 8(1)(d) MCA nonetheless confer power on the Court to exercise whatever jurisdiction is necessary to determine a minor civil action irrespective of whether it ordinarily enjoys the particular jurisdiction required. In context, the effect of Mr Hayes’ submission is that the Court has jurisdiction to determine the validity of service charges, and the underlying administrative acts, if it is necessary to do so in order to determine a minor civil claim even if the Court does not ordinarily enjoy that jurisdiction.
Appropriate Proceedings
Actions for judicial review or declarations are the only proceedings which are suitable to the purpose of determining the validity of service charges and the underlying administrative acts. These proceedings are also the only proceedings suitable to the purpose of determining the validity of the administrative acts performed by the respondent in refusing to remit the charges.
It will be convenient to consider whether the Magistrates Court has jurisdiction to conduct proceedings by way of judicial review or actions for declarations and to then return to Mr Hayes’ primary contention about the effect of s 8(1)(d).
Judicial Review
The Supreme Court has exclusive jurisdiction to review the acts of administrative bodies such as the respondent.
In Eastern Districts Azzurri Sports Club Inc v Harley (1997) (Unreported) District Court Judgment No D3628, Worthington DCJ (as he then was) held that the Magistrates Court has no jurisdiction to conduct judicial review. I see no reason to think that his Honour is wrong and I conclude that the Court has no jurisdiction to review the validity of the charges or the relevant administrative acts.
Declaratory Relief
Mr Hayes pointed to the jurisdiction conferred on the Magistrates Court by s 32 MCA to make declarations of and to the right conferred by s 30 MCA to include equitable claims and defences in actions. Mr Hayes then submits that as the challenge is based on equitable grounds, s 32 confers jurisdiction on the Court to make declarations as to the validity of the charges. If this contention is correct then the Court could also make declarations as to the validity of the respondent’s refusals to remit the charges.
Section 32 is not unqualified. By its terms it limits the Court’s power to make declarations to subject matter which is “within its jurisdiction.”
Section 32 MCA is in analogous terms to s 28 of the Environment Resources and Development Court Act 1993 (ERDA) which confers jurisdiction on the Environment, Resources and Development Court (ERDC) to make declarations on matters “within the jurisdiction” of the Court.
Section s 28 ERDA was considered by the Full Court in Keane v Salisbury City (1995) 87 LGERA 203. King CJ concluded that s 28 does not confer any additional jurisdiction on the ERDC over and above that which it ordinarily enjoys and that it merely provides the Court with the power to grant the additional remedy of a declaration in respect of matters which are already within its jurisdiction. The other members of the Court agreed with King CJ.
In the light of Keane, the effect s 32 MCA must be similarly confined to a power to make declarations in respect of matters which are within the jurisdiction of the Magistrates Court, which the validity of charges and of administrative action is not.
Section 8(1)(d)MCA: Further analysis
However, if Mr Hayes’ submission about s 8(1)(d) MCA is correct, then the Magistrates Court would nonetheless have jurisdiction to determine the validity of charges and the relevant administrative acts.
Section 8(1)(d) confers on the Court whatever jurisdiction is required to grant some form of relief which is essential to the determination of a minor civil action irrespective of whether the particular jurisdiction is beyond that which is conferred on the Court by the other jurisdictional provisions of the MCA, or some other Act.
The terms of s 8(1)(d) confine its operation to the conferral of jurisdiction to grant relief essential to the determination of an action. It does not in its terms confer jurisdiction over the subject matter in relation to which relief is sought. It follows that s 8(1)(d) cannot be engaged unless the Court has jurisdiction over the relevant subject matter.
For the reasons I have given, the Magistrates Court has no jurisdiction to conduct and determine the only proceedings which are suitable to the purpose of determining the validity of service charges and the underlying administrative acts. The Court therefore has no jurisdiction over the subject matter of the challenge. As the Court has no jurisdiction over the charges and the associated administrative acts it follows that s 8(1)(d) cannot engage and the Court cannot grant relief from the charges, or the administrative acts, irrespective of whether it is necessary to do so to resolve the claim.
Self-Creating Jurisdiction
Mr Hayes submits that if a court lacks jurisdiction to determine the subject matter of a proposed collateral challenge, then the mere act of raising the challenge of itself vests in the court all jurisdiction necessary to determine the challenge. The effect of his contention is to say that the raising of a challenge creates jurisdiction and the particular court can then determine the challenge even though it has no jurisdiction to determine the subject matter as the primary objective of the particular action. Mr Hayes did not cite any authority which provides direct support for his proposition. Further consideration of when a collateral challenge might be permitted is required in order to determine this contention.
The circumstances in which a challenge might be entertained were considered by the Full Court in Hinton (ibid) and Jacobs (ibid), and by the High Court in Ousley (ibid).
Hinton was concerned with the availability of a collateral challenge to administrative acts in criminal proceedings. At 522 Bray CJ concluded that a party directly affected by an administrative act can only challenge the validity of the relevant act “in proceedings appropriate to the purpose and not whenever the question arises incidentally”. His Honour also concluded that the administrative acts in question would have been amenable to certiorari or declaratory relief and that a collateral challenge could be entertained in an action in tort. Wells J took a much narrower view. Both Bray CJ and Wells J accepted that administrative acts might be amenable to collateral challenge in some instances. Mitchell J agreed with both Bray CJ and Wells J.
Jacobs was concerned with the availability of a collateral challenge to an item of subordinate legislation. Besanko J concluded that although the challenge could be permitted it was limited to simple ultra vires or inconsistency. In reaching this conclusion his Honour effectively limited the subject matter of the challenge permissible to matters which were within the jurisdiction of the tribunal concerned. He did not go so far as to say that a collateral challenge to administrative acts could never be permitted.
In Ousley a Judge of the Supreme Court of Victoria issued warrants authorising the use of listening devices. The validity of the warrants was subsequently challenged in a criminal trial in the County Court of Victoria. The primary objective of the challenge was the exclusion of the evidence obtained by the use of the devices. The presiding judge refused to permit the challenge on the basis that he had no jurisdiction to review the acts of a Judge of the Supreme Court. The High Court held that as the warrants were issued administratively their validity was thus open to collateral challenge in a court of inferior jurisdiction however, a majority held that the scope of the challenge was limited to the question of whether the warrants were valid on their faces.
It is implicit in the reasons of Besanko J in Jacobs, and of the plurality in Ousley, that the ambit of permissible collateral challenges is not necessarily limitless and that, in any event, the court concerned must have jurisdiction over the subject matter. These implications are contrary to Mr Hayes’ contention.
Mr Hayes submitted that in Hinton Wells J provides support for his contention. Relevantly, at 548-49 his Honour said:
...
Except for those cases where what is claimed to be an administrative act has not even the colour of lawful authority, or where an authority … who is a party to a civil action, pleads, and relies on his own administrative act, an allegedly unlawful administrative act cannot be collaterally impeached in any cause or matter, civil or criminal, unless an Act of Parliament or a valid regulation unequivocally authorises such impeachment. The only correct way of attacking an allegedly unlawful administrative act is by means of a separate proceeding appropriate for the purpose.
…
The relevant charges are the product of the respondent’s administrative acts and the claim is reliant on them. Mr Hayes therefore submits that the exception identified by Wells J is engaged and that the Magistrates Court can determine the validity of charges accordingly. Wells J does not mention the issue of jurisdiction in the passage quoted and, in the absence of anything which suggest to the contrary, it is likely that his Honour was reasoning on the assumption that the exception he identifies can only apply when the authority concerned attempts to rely on its own acts in a court which already enjoys jurisdiction to determine their validity.
Given that a challenge cannot be permitted in the absence of jurisdiction over the subject matter, care must be taken not to read too much into Wells J’s reasons and, in the absence of any express statement from his Honour supporting Mr Hayes’ contention, I am not prepared to conclude that his reasons provide any support for it.
In the light of the foregoing, the contention is rejected.
Before I leave this issue, I should deal with a submission Mr Henry’s which I reject.
Mr Henry submitted that Hinton has never been overruled and that it is determinative of the issue of jurisdiction. In support of his submission he points to State of South Australia v Lampard-Trevarrow (2010) 106 SASR 331 where, in considering Hinton at [244], the Full Court said:
…
In his reasons in Hinton v Lower Bray CJ accepted, whatever might be the limits on collateral challenge, that there could be what is called a collateral challenge when that arose in the course of the assertion of a claim in tort.
…
In our opinion there can be no doubt that the qualification acknowledged by Bray CJ is correct. It is commonplace for an action in tort to depend upon a determination of the validity of an administrative act relied upon in answer to the cause of action.
In reliance on this passage in the Court’s reasons, Mr Henry submits that as this is not an action in tort, the applicant cannot launch his challenge.
The submission reads too much into the statements on which it relies. It cannot be assumed from the terms in which they express themselves that either Bray CJ in Hinton or the Court in Lampard-Trevarrow were intending to confine exceptions to the principle that administrative acts should ordinarily be challenged in appropriate proceedings to actions in tort. In the absence of any clear statement to this effect, the submission must be rejected.
The Prohibition
If I am wrong about this, and if the Magistrates Court does enjoy the necessary jurisdiction, I am nonetheless of the view that the prohibition is engaged and that the Court’s jurisdiction cannot be invoked.
Neither the LGA or the MCA, nor any other Act, provides an express right, as that expression is properly to be understood, to bring proceedings to challenge the validity of service charges in the Magistrates Court. In particular, each jurisdictional provision of the MCA is expressed in general terms insufficient to confer express rights to bring proceedings to challenge the validity of service charges in the Court. The prohibition is thus engaged and any jurisdiction the Court enjoys to determine the validity of service charges cannot be invoked. I should add that the terms of the prohibition are broad enough to catch any jurisdiction conferred by the mere act of raising a challenge.
If the Court’s jurisdiction cannot be invoked the Court cannot exercise it. It follows that the effect of the prohibition is to withdraw the Court’s jurisdiction to determine the validity of charges. The practical effect is thus the same as it would be if the Court had no jurisdiction to determine the validity of charges in the first place. Either way, the court cannot determine the validity of charges.
I therefore do not think it matters that the prohibition focuses on the right to bring proceedings whereas the authorities speak in terms of jurisdiction over the subject matter in the sense that the condition precedent to permitting a challenge of jurisdiction over the subject matter is not satisfied if any jurisdiction over it cannot be invoked.
Discretion
If the Magistrates Court enjoys jurisdiction to determine the validity of service charges which can properly be invoked, questions arise as to whether the Court nonetheless has a discretion to refuse to permit collateral challenges, and if so, how the discretion ought to be exercised in this instance.
The Magistrate did not consider whether she had such a discretion. If she did, I must now consider its exercise.
I start with the reasons of Debelle J and Besanko J in Jacobs. Debelle J said at [18]-[19]:
The obvious policy reason to allow a collateral challenge … is that it avoids an unnecessary duplicity of proceedings …
However, a collateral challenge may not be made where a statute expressly forbids it, although the fact that the empowering Act includes a means by which to test the validity of delegated legislation is not a bar to a collateral challenge …
Besanko J then said at [91]-[96]:
I have considered if the question whether a collateral challenge is permissible in this case may be answered by reference to a general principle that applies in the case of all legislative and administrative acts. However, I do not think the law has reached the stage where such a general principle has been identified. The authorities are still in a state of flux and, to adopt the words of Bray CJ in Hinton Demolitions Pty Ltd v Lower (No 2) it is “hardly likely that this Court will be able to construct an enduring causeway through the flood.” Having said that, since 1971 there have been authoritative decisions such as Boddington and Ousley, which provide the answer to whether a collateral challenge is permitted in particular areas.
...
I do not think there is any doubt that in some cases there are good reasons to allow a collateral challenge and in other cases there are good reasons to deny it. On occasions there may be cases in which a statutory provision will provide a clear answer to the question whether a collateral challenge is permitted in a particular case. Other possible factors which might be relevant in deciding that question have been discussed in the authorities and in the academic literature. I refer to two articles for a helpful discussion of the relevant factors … The factors identified include the following:
Are the grounds of challenge likely to involve the adducing of substantial evidence?
If a collateral challenge is permitted, will all proper parties be heard before the court or tribunal in which the collateral challenge is to be heard?
In the particular case, does the allowing of a collateral challenge by-pass the protective mechanisms associated with judicial review proceedings such as the rules as to standing, delay and other discretionary considerations?
Is there a statutory provision that bears in one way or another on the question of whether a collateral challenge should be permitted?
Is the issue raised by the collateral challenge clearly answered by authority?
Are there other cases pending which raise the same issue?
(Possibly) Is there a more appropriate forum in terms of expertise and perhaps court procedures such that a collateral challenge should not be permitted?
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It may be that, leaving aside cases where a statutory provision provides a clear answer, the common law will develop to the point whereby a court or tribunal in which a collateral challenge is raised has a discretion to entertain the collateral challenge, or to decline to do so and invite the party raising the challenge to institute judicial review proceedings in the court with Jurisdiction to entertain such proceedings. …
At all events, the formulation of a general principle (if there is to be one) as to when the validity of government action, whether it be legislative or administrative in character, may be challenged collaterally must be reserved for the High Court.
It is, as I have said, necessarily implicit in this passage of Besanko J’s reasons that a court with jurisdiction to entertain a challenge may nonetheless refuse to permit it to proceed as an exercise of discretion. There is nothing in the reasons of either Bray CJ in Hinton or Debelle J in Jacobs which suggests otherwise. I will therefore proceed on the basis that such a discretion exists.
The “relevant factors” identified by Besanko J suggest that the policy considerations underlying the existence of the discretion include to avoid giving curial approval to challenges which are likely to be productive of consequences which tend to bypass judicial review or statutory provisions, or are otherwise contrary to the overall interests of justice.
There can be no doubt that Besanko J’s relevant factors are not exhaustive and that other considerations might also be relevant in the circumstances of individual cases. As Mr Hayes put it in his written outline, Besanko J’s relevant factors “are a guide to determining whether it is appropriate and convenient to deal with a collateral challenge incidental to the substantive issue.”
This brings me to the relevant factors and where the balance ultimately lies.
Is it likely that the challenge will involve substantial evidence?
A not insignificant amount of written material said to be relevant to the challenge was put before me. It might well need to be supplemented by oral evidence and the issue of the validity of the respondent’s administrative acts could well involve complex questions of mixed fact and law. The challenge could occupy a significant amount of sitting time which could well be incommensurate with the quantum of the claim.
Will all proper parties be heard if the challenge is permitted?
In a sense the proper parties were before the Magistrate in that the applicant and the respondent are the only parties to the claim. The applicant asserts in his written defence that there was ‘significant resistance’ to the charges and it is easy to see how this could be so. I was also informed that six people made submissions to the respondent during the consultation period before it resolved to impose the charges. It thus cannot be said with certainty that all proper parties will be heard if the challenge is permitted, but given the uncertainty about it, this consideration is of little significance.
Would entertaining the challenge by-pass the protective mechanisms associated with judicial review?
As neither the LGA, or any other Act confers an express right on any person to challenge the validity of service charges by bringing an action for judicial review as an alternative to bringing proceedings in the District Court to try the validity of a charge, the prohibition is engaged and permitting the challenge would not have the effect of by-passing the protective mechanisms associated with judicial review.
Do any statutory provisions bear on whether the challenge should be permitted?
The only statutory provision which bears on the question of whether it would be appropriate to permit the challenge is s 276 LGA itself.
If the challenge were to be permitted, then the practical effect would be to allow the applicant to by-pass both the prohibition and the time limit for bringing proceedings to try the validity of the charges in the District Court and the protections each provide to the respondent. This is of considerable significance and it points clearly away from permitting the challenge.
In this context Mr Henry submits that the reasons of Walsh J in Forster v Jododex Aust. Pty Ltd (1972) 127 CLR 421 stand for the proposition that when special procedures are prescribed by a stature to determine disputes arising under its provisions then, as a general rule, those procedures should ordinarily be followed and not usurped by the making of orders in proceedings of a different kind.
In Forster, applications were brought before a warden pursuant to the Mining Act (NSW) 1906. Before the warden had completed his inquiry declarations were sought in the Equity Division of the Supreme Court of NSW. The relevant passage in Walsh J’s reason is at 427where his Honour said:
In my opinion, when a special tribunal is appointed by a statute to deal with matters arising under its provisions and to determine disputes concerning the granting of rights or privileges which are dependent entirely upon the statute, then as a general rule and in the absence of some special reason for intervention, the special procedures laid down by the statute should be allowed to take their course and should not be displaced by the making of declaratory orders concerning the respective rights of the parties under the statute. In other words, I think that it will ordinarily be a wise exercise by the Supreme Court of the discretion which it has … to decline to undertake the tasks which have been committed by the Parliament to a specialized tribunal. … I think that the procedure set out in the Act itself should be regarded as the normal procedure for dealing with such cases.
The circumstances of Forster are sufficiently analogous for Walsh J’s general rule to legitimately provide some guidance as to how the discretion ought to be exercised, and it is plain that permitting the challenge would, at the very least, be contrary to the spirit of His Honour’s rule.
Has the issue raised by the challenge been authoritatively determined?
The issue raised by the challenge has not been authoritatively determined.
Are there other cases pending which raise the same issue?
I have not been provided with any information about whether there are any other cases pending which raise the same issue.
(Possibly) Is there a more appropriate forum?
By enacting s 276(1)(e) and s 276(7)(c) LGA Parliament has declared that the District Court, or any other court or tribunal in which an express right to bring proceedings is conferred, were to be the appropriate forums in which the validity of service charges were to be determined.
Conclusion on discretion
Even leaving aside the seventh consideration, the balance falls against it being appropriate and convenient to permit the challenge to proceed.
Section 155 LGA
For the reasons which she gives, the Magistrate was correct in concluding that the amendment to s 155 LGA has no retrospective operation and that the applicant was thus obliged to pay the whole of the amount of the service charge imposed for the financial year 2011-2012.
Conclusion
For the reasons I have given, the Magistrates Court has no jurisdiction to determine the subject matter of the challenge in that it has no jurisdiction to determine the validity, of service charges, or of the underlying administrative acts or of the respondent’s refusals to remit the charges. If the Court has relevant jurisdiction, then, and for the reasons I have also given, the challenge should not be permitted as an exercise of discretion.
It is thus unnecessary for me to determine the validity of the respondent’s administrative acts in imposing the charges or in refusing to remit them.
The applicant thus cannot demonstrate that he had a good defence on the merits. The Magistrates judgment must be affirmed accordingly.
Postscript
It is a matter of regret that there has been a significant delay between the hearing of the review and the delivery of judgment. There are two reasons for this. The matter had to be called on for further argument and supplementary submissions were ultimately provided in writing. I was then indisposed for some months. The situation was then further exacerbated by the exigencies of the court’s business.
I realise that this will provide little or no comfort to those who have, completely understandably, become frustrated or inconvenienced by the delay, but they are nonetheless entitled an explanation.
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