Ku-ring-gai Council v Mr Garry West as delegate of the Acting Director-General, Office of Local Government

[2016] NSWLEC 118

Land and Environment Court

New South Wales

• Amendment notes

Medium Neutral Citation:	Ku-ring-gai Council v Mr Garry West as delegate of the Acting Director-General, Office of Local Government [2016] NSWLEC 118
Hearing dates:	2 and 7 June 2016; written submissions 24 June 2016
Date of orders:	20 September 2016
Decision date:	20 September 2016
Jurisdiction:	Class 4
Before:	Moore J
Decision:	See orders at [185]
Catchwords:	JUDICIAL REVIEW – proposal for amalgamation of local government areas – Minister’s referral of proposal to Departmental Chief Executive for examination and report– inquiry required to be held – Chief Executive appoints Delegate to conduct inquiry – whether reasonable public notice given of the holding of inquiry – whether difference between state-wide published notice and locally published notice was a material defect in the requirement for reasonable public notice – whether identification of location of public inquiry sessions adequate – whether inquiry held in accordance with Act – whether examination and report on proposal in accordance with Act – whether the Delegate misdirected himself on matters of rating equity – whether the Delegate misdirected himself on the need to consider the impact of all residents and ratepayers (including on those of an area proposed to be excised) – whether an affected council denied procedural fairness by Delegate – review and comment on Delegate’s report by Boundaries Commission – whether review conducted in accordance with Act – whether affected council denied procedural fairness by Boundaries Commission – publicly accessible material in support of proposal represented that KPMG analysis and modelling was independent – whether representations misleading – whether allegedly misleading representations invalidated statutory process of amalgamation – whether failure to provide all KPMG analysis and modelling material meant the council was denied procedural fairness – exercise of discretion where no utility in taking action based on sole ground made out proceedings dismissed COSTS – reservation of costs in circumstances where applicant is partially successful but no remedy appropriate
Legislation Cited:	Local Government Act 1993 ss 204, 213, 218, 218A, 218B, 218C, 218D, 218E, 218F, 218F(1), 218F(2), 218F(6), 218F(7), 218F(8), 260, 261, 262, 263, 263(1), 263(2), 263(2A), 263(2B), 263(3), 263(5), 263(7), 264, 265, 495, 498(1)(b), 538(1), 705, 706, Pts 1, 2 and 3 of Ch 9, Pt 2 of Ch 17, Sch 2 Local Government (City of Parramatta and Cumberland) Proclamation 2016 Local Government (Council Amalgamations) Proclamation 2016 Prices Regulation Act 1948
Cases Cited:	Ainsworth v Criminal Justice Commission (1991-1992) 175 CLR 564 Barich v Parramatta City Council [2014] NSWLEC 1259 Barrak Corporation Pty Ltd v Parramatta City Council [2014] NSWLEC 1077 Botany Bay City Council v Premier Customs Services Pty Ltd (2009) 172 LGERA 338; [2009] NSWCA 226; Botany Bay City Council v Minister for Local Government [2016] NSWCA 74 Botany Bay City Council v The State of New South Wales [2016] NSWCA 243 Botany Bay City Council v The State of New South Wales [2016] NSWSC 583 Council of the City of Sydney v South Sydney City Council [2002] NSWLEC 129 Gardner v Dairy Industry Authority (NSW) (1978) 52 ALJR 180 Hunter’s Hill Council v Minister for Local Government; Lane Cove Council v Minister for Local Government; Mosman Municipal Council v Minister for Local Government; North Sydney Council v Minister for Local Government; Strathfield Municipal Council v Minister for Local Government [2016] NSWLEC 124 Ku-ring-gai Council v Mr Garry West in his capacity as delegate of the Acting Director-General of the Office of Local Government [2016] NSWLEC 62 Shellharbour City Council v Minister for Local Government [2016] NSWLEC 119 Truth About Motorways Pty Limited v Macquarie Infrastructure Investment Management Limited (2000) 200 CLR 591; [2000] HCA 11 Walcha Council and Ors v Minister for Local Government and Ors [2016] NSWLEC 57 Waterford v Commonwealth (1987) 163 CLR 54; [1987] HCA 25 Woollahra Municipal Council v Minister for Local Government [2016] NSWLEC 44 Woollahra Municipal Council v Minister for Local Government [2016] NSWLEC 86
Category:	Principal judgment
Parties:	Ku-ring-gai Council (Applicant) Mr Garry West (in his capacity as Delegate of the Acting Director-General, Office of Local Government (First Respondent) NSW Department of Premier & Cabinet (Second Respondent) Minister for Local Government (Third Respondent) NSW Local Government Boundaries Commission (Fourth Respondent)
Representation:	Counsel: Mr G Kennett SC/ Mr C McMeniman and Ms V McWilliam (on 3 June 2016), barristers (Applicant) Mr N J Williams SC/Ms A Mitchelmore, Mr J Hutton, Dr J Lucy, Ms M Ellicott, barristers (Respondents)   Solicitors: Sparke Helmore (Applicant) Crown Solicitor’s Office (Respondents)
File Number(s):	154495 of 2016
Publication restriction:	No

TABLE OF CONTENTS

Introduction

Local government in New South Wales

The government announcements

The Minister’s amalgamation proposal documents

The amalgamation proposals challenged

Other challenges

Common complaints with the Hunter’s Hill and other councils proceedings

Introduction

Adequacy of public notice

Conduct of the inquiry

The KPMG issues

The role of the Delegate

Introduction

The Delegate’s reporting role

Consideration of the Delegate’s report

The Council’s complaints concerning the Delegate’s report

The Council’s specific complaints

Introduction

Denial of procedural fairness – undisclosed information

Amendments to “the proposal”

Refusal to make the full KPMG documents available

Notice of the inquiry

The Delegate’s report

The role of the Boundaries Commission

Summary of findings

Discretion

Conclusion

Costs

Orders

Judgment

Introduction

Local government in New South Wales

The broad government amalgamation policy

1. In 2015, the New South Wales Government took a policy decision to explore options for amalgamations of local government councils throughout the state. As part of that process, the government commissioned external advice from KPMG, a major consulting firm. After consideration of that advice, the government determined to develop a number of amalgamation proposals (including some in the alternative) and commence processes under the Local Government Act 1993 (the Local Government Act) that would permit preferred (and proposed for implementation) amalgamation options, were they to eventuate, to be given effect.

2. As the culmination of that process, a process requiring detailed consideration in the instances raised in these proceedings, the government determined to go ahead with a number of amalgamations, but also determined that some other amalgamation proposals that had been investigated were not to go ahead. These abandoned amalgamation proposals included a number of alternatives to amalgamation proposals that the government wishes to proceed and which are being challenged in these proceedings.

The government announcements

3. On 18 December 2015, the Hon Mike Baird MP (the Premier) and the Hon Paul Toole, Minister for Local Government (the Minister), issued a joint press release entitled “Stronger Councils for Sydney and Regional New South Wales”. Relevantly, the press release contained eight paragraphs (non-consecutive ones) that are potentially relevant to these proceedings. Those paragraphs said:

STRONGER COUNCILS FOR SYDNEY AND REGIONAL NEW SOUTH WALES

…

“The community expects a stronger local government system that can deliver the infrastructure and services they deserve, while keeping rates stable”, Mr Baird said.

In Greater Sydney, the NSW Government is proposing 15 new, stronger councils to help the city grow, which would bring the total number of metropolitan councils down from 43 to 25.

…

“Importantly, fewer councils will mean a big reduction in red tape for the NSW community and the businesses that work with councils”, Mr Baird said.

Independent analysis by KPMG of the NSW Government's proposed mergers shows significant financial benefits for NSW of up to $2 billion that can be invested in new infrastructure, improved services or keeping rates stable.

…

The NSW government is using the existing process set out in the Local Government Act to consider council mergers.

…

Detailed merger proposals are now being finalised and will be referred to the Chief Executive of the Office of Local Government (OLG) for examination and report under the existing process set out in the Local Government Act.

The Chief Executive will appoint qualified Delegates, who will commence a public consultation process for all 35 proposals, including public hearings.

Following this stage, final proposals will be referred to the Boundaries Commission for comment.

…

4. At about the same time (and dated December 2015), the government released a document entitled “Local Government Reform Merger Impacts and Analysis”. The document set out seven findings said to arise from this analysis. The findings were in the following terms:

*   the proposed mergers have the potential [to] generate a net financial benefit to local councils of around $2.0 billion across NSW over the next 20 years;

*   an estimated $1.3 billion in net financial savings will be generated over a 20 year period;

*   the estimated costs of the mergers are expected to be absorbed by efficiencies generated by the mergers within three years of implementation;

*   the proposed mergers are expected to generate, on average, $100 million in benefits to local councils every year;

*   savings generated by the proposed mergers will be used to improve frontline services, and fund new community amenities and infrastructure – from better local roads and cycleways, to upgraded parks and recreational facilities;

*   savings can also be used to repair and replace council-owned assets, many of which are in poor condition; and

*   the proposed mergers will result in simplified council regulations through the removal of inconsistencies that currently exist between councils. This will benefit local residents and businesses and streamline the way the community interacts with councils. Reduced layers of regulations will make it easier for people to do business, build homes and access services they need.

5. The report noted:

This report has been prepared by KPMG on behalf of the NSW government. Its preparation has relied upon information sourced from annual data returns and long-term financial plans of individual councils, and a variety of other publicly available sources. Neither KPMG nor the NSW government has independently verified such information.

6. This document dealt with matters at a considerable level of generality without dealing with individual councils or groups of councils.

The Minister’s amalgamation proposal documents

7. The Minister effected, publicly at least, commencement of the suite of amalgamation processes (of which this challenge forms part) by releasing documents advancing each such proposed amalgamation.

8. Relevantly, on 6 January 2016, the Minister released a document entitled “Merger Proposal: Hornsby Shire Council (part), Ku-ring-gai Council”, a document which commenced with a foreword signed by the Minister and which, in its Executive Summary, commenced with the following:

This is a proposal by the Minister for Local Government under section 218E(1) of the Local Government Act (1993) for the merger of Hornsby Shire and Ku-ring-gai local government areas north of the M2. This merger proposal sets out the impacts, benefits and opportunities of creating a new council.

9. The first sentence of that paragraph from the introduction was footnoted with the footnote reading:

The end result if the proposal is implemented is that a new local government area will be created. For simplicity throughout this document, we have referred to a new council rather than a new local government area.

10. First, it is to be observed that, in the Executive Summary for the document, a paragraph appears in the following terms:

The proposal has been informed by four years of extensive Council and community consultation and is supported by independent analysis and modelling by KPMG.

11. The nature of the remainder of the material in this document is discussed later.

The amalgamation proposals challenged

12. In these proceedings, Ku-ring-gai Council (the Council) has challenged the process undertaken by Mr Garry West (the Delegate), as the Delegate of the Acting Chief Executive of the Office of Local Government. The Delegate has been appointed, by an Instrument of Delegation from Mr Tim Hurst, the Acting Chief Executive, to enquire into, and report upon, the proposed merger of this Council with its northern neighbour, Hornsby Shire Council (excluding the area south of the M2). The Council raises a number of matters concerning this process, from its commencement through to the possibility that the Minister may give effect to a recommendation of the Delegate that:

… the proposal as submitted should proceed to implementation.

and recommend to the Governor that the proposed amalgamation be given effect.

13. This judgment deals with the challenge to this proposed amalgamation by the Council. Hornsby Shire Council supports the proposed amalgamation and has played no part in the proceedings.

14. In these proceedings, the Minister gave an undertaking that he would not provide any recommendation to the Governor proposing an amalgamation until two business days after the handing down of this judgment. This arises as, if the Governor-in-Council were to receive such a recommendation and give effect to it by proclamation, the amalgamated councils would, effectively, cease to exist and these proceedings be rendered futile (an explanation of the reasons how this would come to pass can be seen in my judgment concerning Gundagai Council, a council which was amalgamated by the Local Government (Council Amalgamations) Proclamation 2016 during the course of the proceedings it initiated as part of a group of challenges to amalgamation by rural councils – see Walcha Council and Ors v Minister for Local Government and Ors [2016] NSWLEC 57).

15. For convenience, I refer to the various respondents collectively as the Respondents unless the context requires some specific identification.

Other challenges

16. There are three other pending proceedings dealing with proposed amalgamations that have been challenged by one or more of the Councils proposed to be amalgamated. At the same time that I have handed down the decision concerning this challenge by Ku-ring-gai Council, I also handed down my decision in Hunter’s Hill Council v Minister for Local Government; Lane Cove Council v Minister for Local Government; Mosman Municipal Council v Minister for Local Government; North Sydney Council v Minister for Local Government; Strathfield Municipal Council v Minister for Local Government [2016] NSWLEC 124 (the Hunter’s Hill and other councils decision). In the Hunter’s Hill and other councils decision, I set out a short summary of those other proceedings at [1] to [12].

17. In addition to my decision in Hunter’s Hill and other councils, today I have also handed down my decision in Shellharbour City Council’s challenge (see Shellharbour City Council v Minister for Local Government (No 2) [2016] NSWLEC 119.

18. The Court of Appeal has recently handed down its decision in Botany Bay City Council v The State of New South Wales [2016] NSWCA 243 (Botany Bay), an appeal from the decision of Garling J (Botany Bay City Council v The State of New South Wales [2016] NSWSC 583).

19. The decision of the Chief Judge concerning the proposed amalgamation of Woollahra Council in Woollahra Municipal Council v Minister for Local Government [2016] NSWLEC 86 (Woollahra) is also subject to appeal, an appeal which has been heard and the decision reserved.

20. It is to be observed that the case advanced by the Council in Botany Bay, both at first instance and on appeal, differed in one relevant general respect from that pleaded in the Hunter’s Hill and other councils proceedings before me. The Botany Bay case did, however, have that differing element in common with the matters pleaded by this Council. That concerns what should be the proper understanding of the function of the Boundaries Commission in the statutory processes for amalgamation proposals referred to the Acting Chief Executive.

21. A comprehensive outline of those statutory processes was set out by Preston CJ in Woollahra at [9]-[32] in the following terms:

9. Division 1 of Pt 1 of Ch 9 of the Act provides for the constitution of land as a local government area and Div 1 of Pt 2 of Ch 9 provides for the constitution of a council to manage that area. The Governor may, by proclamation, constitute any part of New South Wales as an area: s 204(1) of the Act. The area is to have the boundaries determined by the Governor in the proclamation constituting the area: s 204(2) of the Act.

10. Division 2A of Pt 1 of Ch 9 of the Act prescribes how areas are amalgamated. The Governor may, by proclamation, amalgamate two or more areas into one or more new areas: s 218A(1) of the Act. On the date specified in the new proclamation as the date on which the areas are to be amalgamated, the areas are dissolved and the new area or areas are constituted: s 218A(2)(a) and (b) of the Act.

11. The proclamation of the Governor may include provisions of the kind referred to in s 213, as are necessary or convenient to give effect to the proclamation. The provisions include those for or with respect to the transfer or apportionment of assets, rights and liabilities; the transfer of staff; the alteration of ward boundaries; the holding of elections; the termination, cessation, dissolution or abolition of anything existing before the proclamation takes effect; the preservation or continuance of anything existing before the proclamation takes effect, amongst other matters: s 213(1) of the Act.

12. Division 2B of Pt 1 of Ch 9 of the Act prescribes the process that must be followed before the Governor can amalgamate areas. A function under s 218A to amalgamate areas may be exercised only after a proposal for the exercise of the function is dealt with under Div 2B: s 218D of the Act.

13. The first step in the process prescribed in Div 2B is the making of a proposal under s 218E of the Act to amalgamate areas. Three classes of persons may make a proposal under s 218E to amalgamate areas: the Minister, a council affected by the proposal, or an appropriate minimum number of electors: s 218E(1). Any one of these three classes of persons may initiate a proposal for amalgamation. The third class of persons is defined in s 218E(2). The appropriate minimum number of electors varies depending upon whether the proposal applies to the whole of one or more areas or only part of an area. In the first case, the minimum number of electors is 250 of the enrolled electors for each area or 10% of them, whichever is the greater, and in the second case, the minimum number of electors is 250 of the enrolled electors for the part of the area or 10% of them, whichever is the lesser: s 218E(2).

14. The second step in the process prescribed by Div 2B is the referral of the proposal for examination and report. On the Minister making a proposal or receiving a proposal from a council affected by the proposal or by an appropriate minimum number of electors, the Minister must refer the proposal for examination and report to either the Boundaries Commission or the Departmental Chief Executive: s 218F(1).

15. The “Boundaries Commission” means the Local Government Boundaries Commission constituted under the Act: see the Dictionary and Pt 3 of Ch 9 of the Act. The Boundaries Commission is a body corporate: s 260. It consists of four commissioners appointed by the Governor, of which one is to be a person nominated by the Minister, one is to be a person employed by the Department (Office of Local Government) nominated by the Departmental Chief Executive and two are to be persons appointed from a panel constituted under s 262(1) of the Act: s 261. This panel consists of eight persons who are councillors nominated by the Local Government and Shires Association of NSW: s 262(1). Schedule 2 of the Act contains further provisions on the membership of the Boundaries Commission and the procedure at meetings of the Boundaries Commission: s 261(5).

16. There are some similarities and some differences in the process of examination of and reporting on a proposal by the Boundaries Commission or the Departmental Chief Executive. The similarities concern the process of examination of a proposal (s 218F(2)) and the principal difference concerns the need for review and comment on a report of the examination of a proposal: s 218F(6).

17. The third step in the process prescribed by Div 2B is the examination of and report on the proposal by the person to whom the proposal has been referred. In this case, the Minister elected to refer the proposal he had made to the Departmental Chief Executive. Section 218F(2) of the Act provides that ss 263, 264 and 265 of the Act apply to the examination of a proposal by the Departmental Chief Executive in the same way as they apply to the examination of a proposal by the Boundaries Commission.

18. Section 263 specifies the functions of examining and reporting in relation to a proposal for the amalgamation of areas that has been referred under s 218F(1) and how these functions are to be exercised.

19. Subsection (1) imposes the functions of examining and reporting: the Boundaries Commission or Departmental Chief Executive “is required to examine and report on any matter with respect to the boundaries of areas … which may be referred to it by the Minister”: s 263(1).

20. Subsections (2) and (2A) specify when an inquiry may, may not, or must be held for the purpose of exercising the functions under s 263 of the Act. Of relevance in this case is subsection (2A): the Boundaries Commission or Departmental Chief Executive “must hold an inquiry for the purpose of exercising its functions in relation to a proposal for the amalgamation of two or more areas that has been referred to it in accordance with section 218F”.

21. Subsection (2B) requires that “[r]easonable public notice must be given of the holding of an inquiry under this section”. Neither s 263 of the Act nor the regulations made under the Act prescribe the form or the content of the public notice required to be given or where or how the public notice is to be given.

22. The concept of “public notice” is referred to in s 705 of the Act, which provides:

a)   If the council or another person is required to give public notice under this Act, the notice must state the place at which, the dates on which, and the times during which the matter publicly notified may be inspected by the public.

b)   The notice is to be in the approved form.

c)   The notice is to be given in a manner determined by the council with the object of bringing the matter notified to the attention of as many people in its area as possible.

23. No form has been approved by the regulations made under the Act for the purposes of s 705(2).

24. However, this public notice referred to in s 705 may not be applicable to the public notice that is required to be given by the Boundaries Commission or the Departmental Chief Executive under s 263(2B) of the Act. The public notice referred to in s 705 is a public notice required to be given under the Act by a council. This is clear from the precondition in the opening words of s 705(1) “[i]f the council or another person is required to give public notice under this Act”, the fact that the manner in which the notice is to be given is to be determined by the council (s 705(3)), the fact that the immediately following statutory provision (s 706) prescribes what must happen if and after public notice is given by a council, and the heading of Div 3 of Pt 2 of Ch 17 in which ss 705 and 706 occur, namely “notices by the council” (which forms part of the statute: see s 35(1) of the Interpretation Act 1987).

25.   There is no express guidance given in the Act or the regulations made under the Act of what constitutes “[r]easonable public notice … of the holding of an inquiry”.

26. The inquiry required to be held by s 263(2A) is an inquiry that is open to the public. Subsection (5) requires the Boundaries Commission or Departmental Chief Executive to “allow members of the public to attend any inquiry held by” it.

27. Section 264 concerns representation in “proceedings before the Boundaries Commission”. Section 264 restricts how a person may be represented in proceedings before the Boundaries Commission. A person is not entitled to be represented by an Australian lawyer or by any person acting for a fee or reward: s 264(1) of the Act. However, there are some exceptions, including certain employees or the mayor of a council: s 264(2). As noted earlier, s 218F(2) states that ss 263, 264 and 265 apply to the examination of a proposal for the amalgamation of areas by the Departmental Chief Executive in the same way as they apply to the examination of a proposal by the Boundaries Commission. The only activity involved in the examination of a proposal for the amalgamation of areas referred to in ss 263-265 that could possibly fall within the description of “proceedings” referred to in s 264 is an inquiry held for the purpose of exercising the functions of examining and reporting on a proposal for the amalgamation of areas. Section 264, therefore, may apply to such an inquiry and prevent a person from being represented at the inquiry by an Australian lawyer or any person acting for a fee or reward.

28. As I have noted, the inquiry is to be held for the purpose of exercising the functions of the Boundaries Commission or the Departmental Chief Executive to examine and report in relation to a proposal for the amalgamation of two or more areas that has been referred to it in accordance with s 218F. Section 263(3) prescribes factors to which the Boundaries Commission or Departmental Chief Executive is required to have regard when considering a proposal for the amalgamation of areas. Subsection (3) provides:

3)   When considering any matter referred to it that relates to the boundaries of areas or the areas of operations of county councils, the Boundaries Commission is required to have regard to the following factors:

(a)   the financial advantages or disadvantages (including the economies or diseconomies of scale) of any relevant proposal to the residents and ratepayers of the areas concerned,

(b)   the community of interest and geographic cohesion in the existing areas and in any proposed new area,

(c)   the existing historical and traditional values in the existing areas and the impact of change on them,

(d)   the attitude of the residents and ratepayers of the areas concerned,

(e)   the requirements of the area concerned in relation to elected representation for residents and ratepayers at the local level, the desirable and appropriate relationship between elected representatives and ratepayers and residents and such other matters as it considers relevant in relation to the past and future patterns of elected representation for that area,

(e1)   the impact of any relevant proposal on the ability of the councils of the areas concerned to provide adequate, equitable and appropriate services and facilities,

(e2)   the impact of any relevant proposal on the employment of the staff by the councils of the areas concerned,

(e3)   the impact of any relevant proposal on rural communities in the areas concerned,

(e4)   in the case of a proposal for the amalgamation of two or more areas, the desirability (or otherwise) of dividing the resulting area or areas into wards,

(e5)   in the case of a proposal for the amalgamation of two or more areas, the need to ensure that the opinions of each of the diverse communities of the resulting area or areas are effectively represented,

(f)   such other factors as it considers relevant to the provision of efficient and effective local government in the existing and proposed new areas.

29. To assist the Boundaries Commission or the Departmental Chief Executive in determining the attitude of the residents and ratepayers of an area or areas for the purposes of s 263(3)(d) of the Act, it may conduct (in such manner as it thinks appropriate) an opinion survey or poll of the residents and ratepayers: s 265(1).

30. The fourth step in the process prescribed by Div 2B is that the Departmental Chief Executive (to whom the Minister has referred a proposal under s 218F) must furnish the Departmental Chief Executive’s report of its examination of the proposal to the Boundaries Commission for review and comment: s 218F(6)(a).

31. The fifth step in the process prescribed by Div 2B is that the Boundaries Commission must review the report of the Departmental Chief Executive and send its comments to the Minister: s 218F(6)(b).

32. The process culminates with the Minister considering the Departmental Chief Executive’s report and, if applicable, the Boundaries Commission’s comments on that report. The Minister may recommend to the Governor that the proposal be implemented with such modifications that arise out of the Departmental Chief Executive’s report and, if applicable, the Boundaries Commission’s comments on that report and with such other modifications as the Minister determines, but may not do so if the Minister is of the opinion that the modifications constitute a new proposal: s 218F(7). Alternatively, the Minister may decline to recommend that the proposal be implemented: s 218F(8).

Common complaints with the Hunter’s Hill and other councils proceedings

Introduction

22. Many of the general issues pleaded by the Council were also pleaded in Woollahra and in Hunter’s Hill and other councils. Although the precise wording of the pleading and the supporting particulars in the Second Further Amended Summons of the Council in these proceedings differs in some respects, the common issues engaged and the matters pressed in support of these issues are, in effect, identical.

23. After the Chief Judge handed down his decision in Woollahra, all five councils involved in the Hunter’s Hill and other councils proceedings sought leave to make further written submissions to me to explain why I ought not reach the same conclusion as had been reached by the Chief Judge in Woollahra on the various general matters that were in common.

24. Leave was granted and such written submissions (and written submissions in reply from the Respondents) were provided to me. In Hunter’s Hill and other councils, I dealt with those common, general issues in light of the Chief Judge's findings on each of them and my consideration of the additional submissions made by the Councils and by the Respondents in those proceedings. With respect to each of those general issues, I endorsed the conclusion reached by the Chief Judge that none of those bases of complaint had validity.

25. It is unnecessary for me to repeat, in this judgment, the full detail of my analysis supporting those conclusions in each instance. It is sufficient, in my view, to provide a very brief summary of each of those issues; then to indicate that, in these proceedings, I also adopt the conclusions reached by the Chief Judge in Woollahra and by me in Hunter’s Hill and other councils. The language used in the pleadings in these proceedings differs in only minor aspects, as earlier noted, and does not require different detailed consideration.

Adequacy of public notice

26. The Council pleaded a number of alleged defects in the notice of the inquiry given by the Delegate. Those alleged defects where the complaints were on general grounds that the notice that was given did not satisfy the requirement of s 263(2B) for the giving of “reasonable notice” were dealt with in Hunter’s Hill and other councils at [152] to [175] as the alleged defects (although the wording in the pleadings may have varied) were to the same effect as in those other proceedings. The discussion and conclusions there set out are equally applicable in these proceedings.

27. These complaints are without foundation.

28. This Council also raised specific, individual matters concerning the notice. Those matters are dealt with in the later section of this judgment dealing with the range of complaints specific to this Council.

Conduct of the inquiry

29. The Council pleads a number of alleged defects in the conduct of the inquiry by the Delegate. Those alleged defects where the complaints were on general grounds were dealt with in Hunter’s Hill and other councils at [176] to [188] as the alleged defects (although the wording in the pleadings may have varied) were to the same effect as in those other proceedings. The discussion and conclusions there set out are equally applicable in these proceedings.

30. These complaints are without foundation.

The KPMG issues

31. As in Hunter’s Hill and other councils, the Council pleads that KPMG was not independent, that the Delegate relied on the assertion that it was; and that the basis for the KPMG economic assertions was not disclosed. These defects are said to have denied the Council procedural fairness and to have caused the Delegate’s discharging of his functions to have miscarried in a material respect – thus vitiating his reporting process.

32. These alleged defects were dealt with in Hunter’s Hill and other councils at [196] to [258] as the alleged defects (although the wording in the pleadings may have varied) were to the same effect as in those other proceedings. The discussion and conclusions there set out are equally applicable in these proceedings.

33. These complaints are without foundation.

The role of the Delegate

Introduction

34. Fulfilling the requirements set by the statute for the Delegate is a central matter for consideration in these proceedings. The role of the Delegate is clear and confined. The role is set by the mandate given by s 263(2A) of the Local Government Act - hold an inquiry for the purpose of exercising its functions in relation to a proposal for the amalgamation of two or more areas that has been referred to it in accordance with section 218F. Although this provision speaks of the role of the Boundaries Commission, it applies to the Delegate by virtue of s 218F(2).

35. In order to fulfil this role, the Delegate must ensure that reasonable public notice is to be given of the Delegate’s holding of his inquiry (s 263(2B)). The inquiry must be one at which members of the public are able to attend (s 263(5)).

The Delegate’s reporting role

36. During the course of the Delegate’s inquiry, there are 11 matters specifically set out in the Local Government Act to which the Delegate is to have regard for his examination and report in the context of the proposal that has been referred to him. These 11 matters are set out in s 263(3) and were set out in the earlier extract from Woollahra.

37. Having conducted his inquiry, the Delegate is then required to furnish a report that addresses these mandatory matters. As can be seen from the final point in the list set by the section, there is also a general sweep-up provision that enables the Delegate to report on such other matters as the Delegate considers may be appropriate under the circumstances.

Consideration of the Delegate’s report

38. In Botany Bay City Council v Premier Customs Services Pty Ltd (2009) 172 LGERA 338; [2009] NSWCA 226, Macfarlan JA (with whom Ipp JA and Hoeben J agreed) said, at [32]:

I appreciate that it is not appropriate to approach reasons of a Commissioner with a “fine-tooth comb”, but the Court must nonetheless attempt to ascertain as best it can what were the essential reasons for a decision.

39. I consider it is appropriate to apply that comment in the context of considering a report, pursuant to s 263(1), of a delegate to whom an amalgamation proposal has been referred. Such reports should not be subject to the same degree of forensic dissection as would be the case of a decision made by a judge.

The Council’s complaints concerning the Delegate’s report

40. In these proceedings, the Council points to what it says are a number of significant inadequacies in the discharge by the Delegate of his statutory responsibilities - deficiencies that the Council says are so fundamental that it is appropriate to conclude that the failures by the Delegate, either individually or in combination, caused the inquiry process to have miscarried and it should be set aside.

The Council’s specific complaints

Introduction

41. In addition to the issues common to the various council proceedings that have been determined, to date, in this Court, the Council has raised separate, more detailed issues requiring consideration in these proceedings. That which follows deals with those separate issues.

Denial of procedural fairness – undisclosed information

42. The Council complains (Ground 3) of what it says is a specific denial of procedural fairness caused by the nondisclosure to the Council of material which had been provided (whether in writing or orally) to the delegate thus denying the Council the opportunity to respond to it. This ground was pleaded in the following terms:

3.   The Delegate further denied the applicant (and any other affected member of the community) procedural fairness in taking into account material provided to him without disclosing the substance of the information before him, or providing access to the information or an opportunity to comment on the information.

Particulars

(a)   The Delegate received briefings from the Second Respondent and KPMG staff.

(b)   The applicant was not aware of the substance of the briefings, nor was the fact that the briefings had occurred disclosed to the applicant.

(c)   The applicant did not have an opportunity to make submissions on any material or information provided to the Delegate during the said briefings.

43. The starting point for dealing with this complaint is what was said by Preston CJ in Woollahra at [111] to [113] ([111] being included for context). These paragraphs read:

111. It follows from this conclusion that s 263 did not mandate that the person holding the inquiry (in this case the Delegate of the Departmental Chief Executive) actively question persons speaking at the inquiry or answer questions asked of the Delegate at the inquiry. Where the section is silent as to the procedure to be followed at the inquiry, that procedure within such limits as are necessarily imposed by its qualifying for the description “inquiry”, is left to the discretion of the person holding the inquiry: Bushell v Secretary of State for the Environment at 94-95. The Delegate did not fail to hold an inquiry under the section by stating that he was “here only to listen”.

112. Fourth, it also follows from the previous point that s 263 does not require that all key material relied upon by the Boundaries Commission or Departmental Chief Executive in examining and reporting on a proposal referred to it by the Minister under s 218F must be publicly accessible in advance of the holding of the inquiry. This argument of Woollahra Council is predicated on its mistaken contention that the entire process of examination and report must be carried out in public at the inquiry.

113.   The citation of Bread Manufacturers of New South Wales v Evans (at 413) is misplaced. The inquiry required to be conducted in the circumstances and under the legislation considered in that case was quite different to the inquiry required to be held under s 263 of the Act. There, the High Court held that, because legislation in that case conferred investigative powers on the Prices Commission for the purposes of a public inquiry, where an inquiry was held, the Prices Commission was precluded either from using information obtained privately for the purposes of the inquiry without disclosing it to the parties (per Gibbs CJ and Aickin J) or from obtaining information for the purposes of the inquiry except in public and on oath (per Wilson and Mason JJ). Here, s 263 does not so require that information obtained by the Boundaries Commission or Departmental Chief Executive must be publicly disclosed and publicly adduced at an inquiry held under the section. So too, the inquiries held under the legislation considered in Bushell v Secretary of State for the Environment and B Johnson & Co (Builders) Ltd v Minister of Health were quite different to the inquiry required to be held under s 263 of the Act.

44. Although, in [112], His Honour was dealing with accessibility of material in advance of the holding of the enquiry, an examination of Bread Manufacturers of New South Wales v Evans (1981) 180 CLR 404; [1981] HCA 69 shows that this position is equally applicable at any stage during a Delegate’s examination and reporting process. The joint judgement of Mason and Wilson JJ set out, at [11] the relevant provisions applicable at that time in the Prices Regulation Act 1948. Their Honours noted, at [13], the powers of the Prices Commission:

The investigative powers of the Commission are contained within a group of sections numbered from 9-17. They include the power to summon witnesses and take evidence on oath (s. 9), require information to be given and questions answered (s. 13), require the production of balance sheets and other accounts (s. 14), enter upon and search any premises and inspect any documents or goods taking copies or samples thereof as the case may be (s. 15), and require a return to be furnished by any person or class of persons containing particulars of the quantity and cost of any goods in possession and of prices charged or proposed to be charged in respect of them (s. 17).

45. It is clear that the functions being undertaken by the Prices Commission were, subject to a power of intervention by the Minister, of a determinative nature but, most relevantly applicable, of deriving a conclusion from an enquiry conducted in a fashion significantly akin to that conducted by a court. The position here, mandated by ss 218F and 263 is quite radically different. The conclusion of His Honour in [113] that “s 263 does not so require that information obtained by the Boundaries Commission or Departmental Chief Executive must be publicly disclosed and publicly adduced at enquiry under the section” is clearly applicable to this complaint in these proceedings.

46. This complaint fails.

Amendments to “the proposal”

47. Ground 10 of the Council's Second Further Amended Summons alleges that the Delegate failed to hold a public inquiry into the merger proposal that had been delegated to him. This complaint arises from the changes to what the Council considers to be the Merger Proposal occurred on 20 January and 19 February with this latter date being after the Delegate held his public hearings but before the provision of the Delegate’s report (a report dated March 2016).

48. A document dated 6 January 2016 of 18 pages entitled “Merger Proposal: Hornsby Shire Council (Part) and Ku-ring-gai Council” was published by the New South Wales Government. A copy of this document is in evidence in these proceedings. By letter, dated 7 January 2016, the Delegate wrote to the Council’s General Manager introducing himself, and providing a copy of this document.

49. In this ground, the Council complains of changes made to the Merger Proposal (as this term is defined by the Council as comprising the whole of this document) during the course of the period from its reference by the Minister to the Acting Chief Executive of the Office of Local Government (and thence to the Acting Chief Executive’s Delegate).

50. This gives rise to consideration of a fairly basic question, namely, “What is the proposal for the purposes of the relevant provisions of the Local Government Act?”

51. It is, despite the position advanced by Mr Kennett SC on behalf the Council, a comparatively easy question to answer on a proper examination of the provisions of the Local Government Act engaged in these proceedings.

52. In this process, it is appropriate to start with the provision that permits the amalgamation of, or alterations to, the boundaries of local government areas. This provision, s 218A(1), is in the following terms:

218A Amalgamation of areas

(1) The Governor may, by proclamation, amalgamate two or more areas into one or more new areas.

53. A proposal that suggests such an amalgamation or boundary alteration can be initiated in one of three separate ways. These are contained in s 215 of the Local Government Act. This provision is in the following terms:

215 Who may initiate a proposal?

(1)   A proposal may be made by the Minister or it may be made to the Minister by a council affected by the proposal or by an appropriate minimum number of electors.

(2)   An appropriate minimum number of electors is:

(a)   if a proposal applies to the whole of an area or the proposal is that part of an area be constituted as a new area—250 of the enrolled electors for the existing area or 10 per cent of them, whichever is the greater, or

(b)   if a proposal applies only to part of an area—250 of the enrolled electors for that part or 10 per cent of them, whichever is the lesser.

54. Once such a proposal has been developed by the Minister, or advanced to the Minister by one of the two community-based processes envisaged in the above section, the Minister is obliged to have the proposal examined in a fashion at arm's-length from the Minister. The Minister has two options available for the carrying out of this process. The first is a direct reference to the Local Government Boundaries Commission (s 218(1)), whilst the second is to refer the matter to the Chief Executive of the Office of Local Government, with this being the course adopted in this proposal (s 218F(1) and (2)). The Chief Executive Officer (in this case the Acting Chief Executive) can, in turn, appoint a delegate (s 745(1)) to enquire into the proposal.

55. In this instance, the Acting Chief Executive appointed, amongst a range of appointments of delegates for the various local government amalgamations proposed as part of the local government reform policy of the government, Mr Garry West to be the Delegate for the purposes of examining the proposal involving the Council and Hornsby Council. A copy of the Instrument of Delegation that included the delegation to Mr West is in evidence in these proceedings.

56. At that time, the document entitled “Merger Proposal: Hornsby Shire Council (Part) and Ku-ring-gai Council” was published on a government website and provided to the both councils. The first version of this document (as the Council complains, there are subsequent versions of it where amendments were made to portions of the text or tables of the document or additional footnoted information was provided), was dated 6 January 2016.

57. On p 3 of the document (a map of the proposed merged area, being on p 1, and the Minister’s foreword being on p 2), in the Executive Summary, under the heading “Introduction”, the opening sentence describes the proposal in the following terms:

This is a proposal by the Minister for Local Government under section 218E(1) of the Local Government Act (1993) for the merger of Hornsby Shire and Ku-ring-gai local government areas north of the M2.

58. It is accepted by those representing the Council that, in all subsequent versions, this sentence remains unchanged. Further, the sentence is footnoted and it is also accepted that, in all subsequent versions of the document, this footnote remained unchanged. The footnote is in the following terms:

The end result if the proposal is implemented is that the new local government area will be created. For simplicity throughout this document, we have referred to a new council rather than a new local government area.

59. Finally, before returning to further consideration of relevant provisions of the Local Government Act, it is appropriate to note that the Delegate's report includes an express statement as to his understanding of what constituted the proposal into which he had conducted his inquiry. The Delegate's report is also in evidence in these proceedings. The relevant extract appears in his report at p 6 and is in the following terms:

The proposal is for the amalgamation of the existing Ku-ring-gai Council and part of Hornsby Shire Council north of the M2 Motorway.

60. The obligations that were placed on the Delegate were those resulting from deeming provisions contained in s 218F(2) that deemed the provisions of ss 263, 264 and 265 to apply to an inquiry conducted by a delegate through this process. The process to which those provisions would ordinarily apply is that undertaken if such a proposal were to be examined by the Local Government Boundaries Commission.

61. At this point, it is convenient to note that the position advanced on behalf of the Council is that the totality of the document dated 6 January 2016 (and its subsequently revised versions – at least to the time of the public inquiry conducted by the Delegate at the Pymble Golf Club on 3 February 2016) constituted “the proposal” for the purposes of the Local Government Act.

62. The position of the Respondents is that the proposal is only that set out in the first sentence of the Executive Summary in the 6 January 2016 document and that all that follows after that sentence is merely explanatory material to enable a proper understanding of the proposal.

63. The fallacy in the Council’s position can clearly be demonstrated by having regard to three factors:

• First, the formal Instrument of Delegation is one in narrow terms;

• Second, one arises from the terms of the Local Government Act itself; and

• Whilst the third comes from guidance given by the Court of Appeal.

64. First, Attachment 1 to the Delegate’s report is a copy of the Instrument of Delegation signed by the Acting Chief Executive of the Office of Local Government. The instrument is in the following terms:

Pursuant to s. 745(1) of the Local Government Act 1993 (the “LG Act”), I, Tim Hurst, Acting Chief Executive, Office of Local Government, delegate to the persons listed in Part A in respect of the proposal is listed opposite in Part B the following functions conferred on me by the LG Act:

1. Examination of and report on one or more proposals referred by the Minister under s. 218F of the LG Act; and

2. Any function that is incidental to the function of examining of and reporting on proposals under s. 218F of the LG Act.

65. Relevantly, where Mr West's name is written in Part A of the table setting out the delegations, there appears, in Part B, Hornsby Shire (part) and Ku‑ring‑gai. This, clearly, defines the proposal in a statutory sense. The detail of what “Hornsby Shire (part)” means is not to be derived from the Minister’s document but solely from the elements earlier set out from p 4 of the Executive Summary of that document.

66. Second, the Local Government Act specifies a range of matters that fall within the remit of a delegate appointed to carry out the functions for which Mr West has been appointed. As earlier set out in the extract from Woollahra, there are 10 specific aspects and one “catch-all” set out and they are contained in s 263(3) of the Local Government Act.

67. One of the matters required to be examined and reported upon by the delegate is the attitude of the residents and ratepayers of the areas concerned to the proposal (s 263(3)(d)).

68. In combination, s 263(3)(d) and s 265 permit the Delegate (but does not compel the Delegate) to conduct (in such manner as the Delegate thinks appropriate) an opinion survey or poll to assist the Delegate in determining the attitude of the residents and ratepayers of an area or areas for the purposes of section 263(3)(d).

69. It is clearly absurd to suggest that the totality of the 6 January 2016 document could be submitted to such a process.

70. The document, beyond the terms of the introductory sentence (and its footnote earlier set out), contains what can only be regarded as material of an advocacy nature that seeks to explain and justify that which is set out, with sufficient precision, in the first sentence earlier described. It is clear that this document, in its various forms, constitutes the Minister’s submission and public advocacy document for this merger.

71. Although the terms of the explanatory material, in addition to canvassing a wide range of matters, also sets out, with mapped information, a visual explanation of that which is set out at the commencement of the document, there is nothing contained in the document that could be regarded as enlarging the scope of the proposal as set out in that first sentence and as confirmed to be the Minister's proposal by the footnote to it.

72. Finally, it is clear from the recent decision of the Court of Appeal in Botany Bay City Council v Minister for Local Government [2016] NSWCA 74 that this must be the case. The judgment of the Court (Bathurst CJ, Beazley P and Ward JA) said, at [38]:

Section 263(1) requires the Boundaries Commission or the Departmental Chief Executive, as the case may be, “to examine and report on any matter with respect to the boundaries of [councils] which may be referred to it by the Minister”. The phrase “any matter” is not defined and of itself may be taken to be of wide import. Likewise, the phrase “with respect to” is of wide import. However, there are two indications in subs (1) itself that its meaning is more confined. First, and most importantly, on the express words of the subsection, “any matter” is controlled by the phrase “which may be referred to it by the Minister”. Secondly, any such matter must be “with respect to the boundaries of [councils]”. Accordingly, what falls within s 263 for examination and report is any matter with respect to boundaries that is referred by the Minister. In this case, that was the Minister’s proposal.

73. This, also, makes it expressly clear that a ministerial (or any other) proposal for the amalgamation of local government areas, or the alteration of boundaries of local government areas, must be in a form that is of the precision contained in the first sentence of the Executive Summary in the 6 January 2016 document described above for it to be referred for consideration by either the Local Government Boundaries Commission or the Chief Executive of the Office of Local Government.

74. It must also be in a form capable of implementation by the Governor on the recommendation of the Minister by proclamation pursuant to s 218A of the Local Government Act. This requires certainty in description of the area in the proposal.

75. The boundaries of the two existing local government areas are defined and there is no necessity to repeat a “metes and bounds” description of them as they are precise and fixed. Similarly, the definition of the area to be excised from the Hornsby local government area and transferred to another council is also precise, as the M2 is a clearly self-defining, physically identifiable boundary not requiring further description to give it complete accuracy.

76. It therefore follows that, for the purposes of the Local Government Act, the proposal being dealt with by the Delegate, and requiring consideration in these proceedings, is confined to the merger of Hornsby Shire and Ku-ring-gai local government areas north of the M2 and not the totality of the 6 January 2016 document, or any subsequent, amended version thereof.

77. This ground fails.

Refusal to make the full KPMG documents available

78. The Council’s complaint (Ground 1) that the full KPMG documents were not made available was dealt with by me when I upheld a claim for public interest immunity – see Ku-ring-gai Council v Mr Garry West in his capacity as delegate of the Acting Director-General of the Office of Local Government & Ors [2016] NSWLEC 62.

79. As a consequence of this determination and what was dealt with earlier in the section of this judgment dealing with KPMG (and its involvement and its documents), this complaint is without foundation.

80. However, the Council also complains (Grounds 2, 3, 4 and 5) that the refusal to provide the full KPMG documents was a denial of procedural fairness by the Department of Premier and Cabinet and that these documents should have been taken into account by the Delegate. To the extent that these grounds merely constitute a re-pleading of Ground 1, it was answered as noted above.

81. To the extent that there is embodied in these grounds, a complaint concerning the availability of the full KPMG documents to the Delegate, this is dealt with in Hunter’s Hill and other councils at [218] to [254]. The reasoning there set out is equally applicable in these proceedings.

Notice of the inquiry

Introduction

82. The Council makes a number of complaints about the notice of the inquiry given by the Delegate. These complaints are that the notice that was given did not satisfy the requirement of s 263(2B), a provision which requires that reasonable public notice must be given of the holding of an inquiry under this section. The Council says that the notice actually given by the Delegate could not be regarded as reasonable as it was inadequate in a number of material respects. The deficiencies that the Council identifies and proposes should lead to this conclusion are:

1. The heading of the notice did not adequately describe the nature of the proposal that was the subject of the inquiry;

2. The heading of the notice did not accurately set out the nature of that which was to be examined by the inquiry;

3. The description of the venue at which the two sessions of the inquiry by the Delegate were to be held did not contain sufficient information to permit a person interested in attending the inquiry to identify with sufficient precision where the inquiry was to be held;

4. The information that was provided concerning the venue at which the sessions of the inquiry were to be held, by not providing a street address, meant that there was a risk that those interested in attending the inquiry might be confused about where the inquiry was to be held;

5. The deficiencies in the terms of the notice given by the Delegate were not amenable to being cured by any supplementary information circulated, in the varying fashions actually utilised, by the Council;

6. The differences between the versions of the advertisement placed by the Delegate in the Sydney Morning Herald and the Daily Telegraph, with the terms of the advertisements placed in The North Shore Times and the Hornsby Advocate (being a difference that the Council says is material) meant that, to the extent that these advertisements are relied upon as satisfying the statutory provision, they did not do so;

7. The reliance on the ability of a person reading the advertisement to access additional information by being referred to a website or to a local-call-cost telephone number does not provide any assistance in curing of such defects as the Council submits are contained in the notices; and

8. Although not expressly stated, the implication of the registration process set out in the two versions of the advertisements had the effect of implying that it was necessary to register as a precondition to attending, or speaking at, a session of the Delegate’s inquiry.

Alleged deficiencies 1, 2, 5, 7 and 8

83. These complaints are in common with those pleaded in Hunter’s Hill and other councils and are dealt with at [26] to [27] above.

Alleged deficiencies 3 and 4 – location of the inquiry

84. The Council complains that identification in the notice of the location of the Delegate’s inquiry to which interested people or organisations were invited was insufficient and, in this instance, also geographically misleading. These complaints can be dealt with comparatively briefly.

85. As earlier observed, the notice given by the Delegate of the holding of his inquiry was published in both metropolitan and local newspapers. The location was described in those notices in the following terms:

Venue: Pymble Golf Club

86. The Council makes two complaints about this description. The first is that it does not provide sufficient specificity – in that the street address (Cowan Road, St Ives) is not provided and, second, that, although the golf club has, as its proper name, the Pymble Golf Club, it is not, in fact, in Pymble and is outside the boundaries of that suburb, being a little to the north-east of the suburb of Pymble.

87. As a subsidiary element of the second issue, the Council points to the fact that there is, in fact, a golf club in Pymble, known as the Avondale Golf Club, and this second golf club is some distance away from the Pymble Golf Club (approximately three kilometres as the crow flies) and on the other side of the northern railway line/Pacific Highway spine that runs through the Ku-ring-gai municipality.

86. I am satisfied that these complaints are without foundation. I have so concluded for the following reasons. First, the identifier contained in the Delegate’s notice is capitalised and is not set out as being “a golf club in Pymble” or “Pymble golf club”. It is clearly the title of a specific place rather than some generic descriptor. For those who might, of their own knowledge, know where the Pymble Golf Club was located, such a descriptor would be sufficient, in itself. For those who did not know where that institution was located, it would be necessary to make some further enquiry as to where it was and, if the person seeking the information proposed to attend the Delegate’s inquiry, obtain information on how to reach the venue.

87. Even if the notice had said:

Pymble Golf Club, Cowan Road, St Ives

it is also reasonable to assume that, for a very significant element (if not the vast majority) of those resident in these two local government areas (or anybody else who might be interested in attending this inquiry who was resident outside those areas), those persons would not have precise knowledge of how to reach Cowan Road, St Ives and would need to make some subsequent enquiry of how to get the venue.

90. The notice, itself, provides two sources for further information: they being a website, and a local-call-cost telephone number. There is no suggestion that visiting the website would not have provided sufficient information on how to access the venue, nor that any person making a telephone enquiry seeking such information would not so have been given information in sufficient detail to permit them find the venue.

91. In any event, it is likely that anybody with other than an immediate and sufficient knowledge of how to get to Cowan Road, St Ives and, thus, limited by the name of the road only, would need to resort to some other way of obtaining directions for this purpose.

92. Whether that information would be, in this ubiquitous electronic information age, by consulting Google maps or some form of GPS system or by old-fashioned paper street directory or, even more primitively, by taking handwritten notes during a telephone enquiry (whether to the advertised number or to the Pymble Golf Club itself), I am satisfied that the identification given in the notice was of sufficient particularity so as to provide an adequate description of the venue in a fashion that would enable anybody wishing to attend the inquiry to be able to inform themselves sufficiently to get to the venue.

93. I am also satisfied that the pool of potential participants whose knowledge would have been such that further enquiry would have been unnecessary (had the street address been given) would not have been so significantly large as to obviate any reasonable likelihood of further information needing to be sought to enable a potential participant to get to the venue.

94. The suggestion that a capitalised identifier used in the fashion included in this notification could only be regarded as sufficient if that which was identified was iconic (for example the Opera House) cannot succeed for the reasons earlier described.

95. The complaint that the Avondale Golf Club is in Pymble but Pymble Golf Club is not, is similarly misconceived in my view. If a potential participant did not know of the existence and/or location of the Pymble Golf Club, any enquiry seeking an answer to the question “where is the Pymble Golf Club?”, whether the enquiry is done physically in a street directory, electronically via some search engine or by telephone, will not be directed to the Avondale Golf Club.

96. The capitalisation of the name was of sufficient specificity under the circumstances to permit a person desiring to attend the inquiry to be held by the Delegate to be able to find the venue without there being any realistic risk of not being able to do so or going to the wrong place.

97. This ground fails.

Alleged deficiency 6 – the two versions of the notice

98. To enable an understanding of the discussions that follow, it is appropriate to reproduce a copy of each of the two versions of the notice. First, I reproduce a copy of the notice that was published in the Sydney Morning Herald and in the Daily Telegraph. The notices in these two metropolitan-wide circulating newspapers appeared on 13 January. These two advertisements were in identical terms. That from the Sydney Morning Herald is reproduced below:

99. The form of the notices that were published in The North Shore Times and the Hornsby Advocate differed from those reproduced above in only one respect. That is, as can be seen from the form of the advertisement reproduced below, the word “(part)” appears after “Hornsby” in the upper portion of the advertisement, whereas that notation was absent in the metropolitan circulation newspaper advertisement. The advertisements in the suburban papers were published on 20 and 27 January 2016 (for The North Shore Times) and 21 and 28 January 2016 for the Hornsby Advocate. The suburban paper-circulated advertisement was in the following form (North Shore Times version reproduced):

100. In Woollahra, Preston CJ discussed at [49] the necessity for a public notice given pursuant to s 263(2B) to state what is the particular inquiry that is to be held. He also said, at [54]:

A person should know from reading the public notice what is the subject matter and purpose of the inquiry to be held …

101. The notice that was given in Woollahra, as was the position with respect to these notices, included the words “or alter the boundaries of” in the heading of the notice. His Honour dismissed Woollahra Council's complaint about those words at [63] and [64], where His Honour said:

63.   I do not consider that this reference to a matter that was not part of the Minister’s proposal meant that the notice did not alert the reader to the proposal in relation to which the inquiry was to be held and in respect of which submissions to the inquiry were to be made. Notwithstanding the additional reference to alteration of boundaries, the notice still identified that the Minister may have referred a proposal to amalgamate the local government areas of Randwick, Waverley and Woollahra, which was to be the subject of the inquiry that was to be held.

64.   Persons who were concerned about the amalgamation of these areas would be alerted to this fact and the opportunity for them to make a submission to the inquiry about this proposal to amalgamate those areas. The persons would not be dissuaded from doing so because the notice also referred to a proposal to alter the boundaries of those areas.

102. In this instance, paraphrasing what His Honour said in the second sentence of [63], it is clear that notwithstanding the omission of the word “part” in the Sydney Morning Herald and Daily Telegraph advertisements, those notices still identified that the Minister had referred a proposal to amalgamate the local government areas of Hornsby and Ku-ring-gai which was to be the subject of the inquiry that was to be held. In addition, the inclusion of “part” would not have assisted a reader to understand the extent of the scope of the proposal.

103. His Honour's observation in [64] in Woollahra is also equally applicable in these proceedings.

104. Finally, on this point, there is no evidence that anybody was, in fact, misled by the omission of the word “part” from the advertisements that appeared in the state-wide circulating newspapers.

105. In any event, the advertisements that appeared in the two local circulation newspapers, being advertisements after the date of the state-wide circulating ones and in newspapers that the Council has not challenged as constituting appropriate and sufficient local circulation would have acted as a cure for the defect in the earlier advertisements.

106. In addition, as his Honour noted at [56]:

Public notice by newspaper advertisement in newspapers circulating in the local government areas affected by the proposal is fair and reasonable notice to the public: Waitemata County v Local Government Commission [1964] NZLR 689 at 699.

This observation is equally applicable here.

107. This basis of complaint fails.

Conclusion on the notice of the inquiry

108. For the reasons set out above, there is no validity in these complaints.

The Delegate’s report

Introduction

109. The Council makes two specific and substantive complaints concerning the Delegate’s report. First, the Delegate’s failure to give what the Council says is the impact on rates (and thus on Ku-ring-gai residents) – vide s 263(3)(a) – of the proposed amalgamation caused his reporting to miscarry in this respect (Ground 9).

110. Second, the Council says that the Delegate declined to give consideration to the proposed excision of the area south of the M2 and that this failure caused his reporting to miscarry in this respect (Ground 8).

The requirements of s 263(3)

111. As part of the Delegate examining and reporting on the proposal that has been referred to him, the Delegate is required to have regard to the 10 specified matters set out in s 263(3) and may, additionally, have regard to other matters that the Delegate considers are warranted under the circumstances (s 263(3)(e5) contains this catch-all provision). In this context, it is appropriate to note two aspects of what is required of the Delegate by this section.

112. The first is that each of the matters that are set out in it are coequal. That is, the provision itself provides no ranking to which the Delegate is obliged to have regard. The consequence of this is that, as part of the reporting function to be undertaken by the Delegate after his examination of these matters (and after holding the mandated public inquiry), the Delegate is required to have examined and reported upon each of these mandated topics. In doing so, the Delegate is required to engage with and consider, in a sufficient and relevant fashion, each of these mandated topics.

113. Failure by the Delegate to do so with respect to any of the topics will mean that the Delegate has not discharged his statutory obligations and, as a consequence, the Delegate’s function will have miscarried. However, what consequences might flow from such an outcome requires consideration of such factors (if any) requiring consideration in the circumstances.

114. Second, the Delegate is required to have regard to each of those mandatory factors as part of the examination and reporting process. There is no requirement in the statute for the Delegate to be satisfied in some fashion with respect to any of these matters. What is required of the Delegate, after engaging with and examining each of these factors, is to report upon them individually and collectively. It is clear from the terms of s 263(7)(b) that it is envisaged that the Delegate will contemplate whether or not to make recommendations of a detailed nature in addition to expressing conclusions with respect to the overall proposal.

115. It is also apposite to observe, further, one aspect concerning the structure of the language used in s 263(3). This concerns the use of the word “areas”. A proper reading of this provision makes it clear, in my view, that this requires consideration, in each relevant context, of each of the existing local government areas that are the subject of the Minister’s proposal.

116. In this context, this required the Delegate for this proposal to engage, for each relevant matter, with the whole of the pre-existing Hornsby and Ku-ring-gai local government areas as relevantly engaged by the particular element of s 263(3). This broad statement of approach requires specific attention in my analysis of the adequacy of the Delegate's consideration of matters involving the portion of the then existing Hornsby local government area proposed to be excised and transferred to another new local government area to be constituted under the Local Government Act and, as a consequence, not included in the proposed amalgamation of the Hornsby and Ku-ring-gai local government areas.

Equity in rating – s 263(3)(a)

117. The Council pleaded a specific complaint concerning the way the Delegate addressed (or in the Council’s case, failed to address) questions of rating equity for the ratepayers of Ku-ring-gai if this proposed amalgamation were to take place. The relevant element of the Council's pleading on this point was in the following terms:

9. The First Defendant made a material error of fact with regard to rates in assessing the financial impact to residents under s 263(3)(a) of the LG Act that was so significant as to infect the exercise of the Delegate’s jurisdiction under s 263(3)(a) of the LG Act.

Particulars

(a)   The First Defendant referred to rates in the Ku-ring-gai area as being 12.9% higher than in Hornsby: Report p 13. This was incorrect.

(b)   The First defendant then found that this fact did not accord with an undeniable fear amongst Ku-ring-gai residents that their rates will rise should the proposal succeed: Report p 13.

(c)   The First Defendant further found that equalisation of rates could occur through the adoption of sub-categories: Report p 13.

(d)   The First Defendant’s finding fundamentally misunderstood the process by which rates are set, in that the First Defendant ought to have accepted that the rates of Ku-ring-gai residents would rise, should the Merger Proposal proceed.

(e) The First Defendant further misunderstood that on the proper construction of the LG Act, the necessary sub-categories referred to by the Delegate were impermissible: see s 529(2) of the LG Act.

118. Consideration of this issue formed part of the Delegate’s analysis pursuant to s 263(3)(a). On page 12 of his report, the Delegate noted, with respect to the written submissions that he had received, that, amongst them was a concern for:

Potential for a rate increase, particularly in the Ku-ring-gai area due to higher land values.

119. On page 13 of his report, the Delegate set out a separate section concerning rating. This was in the following terms:

5.1.5 Rating

Many submissions raised the probability of rate rises as noted above.

NSW councils have extensive discretionary powers to determine the appropriate rates and charges for their local areas. They are directly accountable to their local communities for the impact these policies have on individual ratepayers. OLG statistics disclose that average Council residential rates in Ku-ring-gai currently 12.9% higher than in Hornsby. This does not accord with an undeniable fear amongst Ku-ring-gai residents that their rates will rise should the proposal succeed.

If an amalgamation occurs the proclamation for the new council will preserve the rating structure of the former councils for the first 12 months of a merger. In addition, the NSW government has adopted a policy to freeze existing rate paths for four years which carries this rate structure forward for a further three years. To achieve this the government has commissioned IPART to identify the mechanism which will ultimately require legislative change.

Each year, all councils are required to prepare a draft operational plan. This plan outlines the Council's revenue policy for the coming year, including details of the proposed rating structure. The draft plan must be made available for public comment the Council must consider any submissions made by members of the community before adopting it.

Therefore, after the first four years, if a merger has occurred, the Council will complete the draft operational plan identifying its rating structure and how they plan to achieve an equalisation of the rating impact. This equalisation can occur through the adoption of subcategories within the categories of residential, business, farmland and mining as determined in section 514 of the Act.

Issues relating to Ku-ring-gai Council's environmental levy would be considered by the new Council as part of their consideration of the draft operational plan.

120. In his conclusions arising out of his consideration of the matters mandated by section 263(3)(a), the Delegate did not deal with the general matters concerning rating in any further detail. The Delegate did, however, deal with special rate variations on page 15 of his report but this does not require consideration in the context of Ground 9 as pleaded by the Council (as earlier set out).

121. As earlier noted, the Delegate had forwarded his report to the Chairperson of the Boundaries Commission on for the Boundaries Commission's examination and comment. The Boundaries Commission's comment on this point was:

The Commission’s view is that the Delegate adequately considered the issues under this factor.

122. In his written submissions on this point, Mr Kennett said:

102. The Delegate made material errors of fact and law with regard to rates in assessing the financial impact to residents under s 263(3)(a) of the Act.

103.   The Delegate referred to rates in the Ku-ring-gai area as being 12.9% higher than in Hornsby: Report p 13. This was a finding of fact based on an incorrect principle because it confused the average residential rates with how rates are actually set, by reference to cents in the dollar.

104.   The Delegate then found that this fact did not ‘accord’ with an undeniable fear amongst Ku-ring-gai residents that their rates will rise should the proposal succeed: Report p 13.

105.   The Delegate further found that equalisation of rates could occur through the adoption of sub-categories: Report p 13.

106.   These findings of the Delegate indicate that he fundamentally misunderstood the process by which rates are set and the applicable statutory provisions.

107.   The Delegate ought to have accepted that the rates of Ku-ring-gai residents would rise when properly calculated by reference to the cents in the dollar, should the Merger Proposal proceed. An example given was that a property with a land value of $800,000 presently pays $1,630 in residential rates in Ku-ring-gai, whereas in Hornsby Shire, a property of the same land value pays $1,928.

108.   Next, the Delegate found that ‘an equalisation of the rating impact’ (presumably as between Ku-ring-gai and Hornsby ratepayers) could ‘occur through the adoption of sub-categories within the categories of residential, business, farmland and mining’: Report p 13. However, for at least three of these categories, sub-categories based on location within one or another of the former areas would be precluded by 529(2) of the Act.

109. Such a misunderstanding meant that the Delegate did not have an appreciation of the salient facts and law such as to understand the scope of the problem in relation to rate equalisation. The error was accordingly one that infected the exercise of the Delegate’s jurisdiction under s 263(3)(a) of the Act, in accordance with the authorities cited above.

123. The Respondent's written submissions on this point were:

40 In any event, the respondents contend that the Court would not accept that the Delegate made a material error of fact of a nature which might rise to the level of McLellan J’s comments in Centro. At paragraph 5.1.5 of his report, the Delegate considered submissions raising the probability of rate rises. This issue was but one aspect of the Delegate’s consideration of a range of matters that he identified as relevant in examining the financial advantages and disadvantages of the proposal under s 263(3)(a) of the LGA. In relation to that aspect, the Delegate:

(a)   noted at the outset that “many submissions raised the probability of rate rises”, from which and it should be inferred that the Delegate read and considered that material, including the Council’s submissions in that respect (cf AS [106]);

(b)   referred to rates in the Ku-ring-gai as drawn from OLG statistics;

(c)   in respect of those rates, made the evaluative statement that “this does not accord with an undeniable fear amongst Ku-ring-gai residents that their rates will rise should the proposal succeed”; but

(d)   did not make any conclusive determination as to whether rates would in fact rise, as this was contingent on the further steps outlined by the Delegate discussed below (as was also acknowledged in the submissions made by the Council);

142. The Council pleaded this concern in Ground 8 of its Second Further Amended Summons in the following terms:

1   The First Defendant made a further jurisdictional error in failing to take into account relevant considerations, namely:

a. The financial advantages or disadvantages of the Merger Proposal to the residents and ratepayers of the areas concerned: s 263(3)(a) of the LG Act;

b. The community of interest and geographic cohesion in the existing areas and in any proposed new area: s 263(3)(b) of the LG Act;

c. The attitude of the residents and ratepayers of the areas concerned: s 263(3)(d) of the LG Act;

d. Such other factors as he considers relevant to the provision of efficient and effect local government in the existing and proposed new areas: s 263(3)(f) of the LG Act.

Particulars

i.   The First Defendant expressly declined to consider submissions relating to impacts associated with the excise of the areas of Hornsby south of the M2 Motorway: Report p 20, 24, 39.

ii.   The area covers approximately 20,000 rate-payers in the Hornsby area which are part of the existing area concerned.

iii.   Accordingly, the First Defendant was obliged to consider the attitudes of those residents and/or the financial, community, geographic and any other relevant impact on those residents.

145. The Delegate considered the excision of the area south of the M2 motorway in a limited fashion. His report sets out, on pages 10 and 11, the impact on the income and expenditure patterns of the (then) Hornsby Shire Council of the proposed excision. The analysis also dealt with what might be the impact on the amalgamated area of the excision.

146. The financial impact was also discussed in a further short section on page 14 of the Delegate’s report. This section also only dealt with the financial impact on the Councils, if amalgamated, of the proposed excision.

147. In his consideration of s 263(3)(b) of the Local Government Act of the community of interest in geographic cohesion and the existing areas and in any proposed new area, the Delegate commenced his conclusion on this point, at page 20 of his report, by saying:

The area south of the M2 Motorway is the subject of another merger proposal, therefore while the issues and concerns are noted it would be expected they would primarily be considered in that report. Cognizance though is given to the financial impacts this change to the Hornsby Council boundary will have and is considered and reported under another factor of this report.

148. In his summary of community submissions, the Delegate said, inter alia, at page 24 of his report, at the commencement of this section:

At the public enquiry the majority of people spoke against the merger proposal, this is also reflected in the submissions. However it must be indicated that while majority of the submissions were opposed to the Hornsby (part)/Ku-ring-gai merger proposal approximately a quarter were against excising the areas of Hornsby south of the M2 Motorway. As these are the subject of another merger proposal the detail is not summarised below.

149. In his conclusion on this topic, the Delegate merely noted that Hornsby Council had:

… clearly sought to advocate for on behalf of those residents who live south of the M2 Motorway.

150. Under s 263(3)(f), the catch-all provision, the Delegate dealt with Hornsby Council’s submissions concerning the area south of the M2 Motorway (page 38 of his report). The Delegate wrote:

The proposal to excise land south of the M2 Motorway should have a major impact on the forecast dwelling supply for Hornsby Shire in the short term as Epping is currently the focus of significant development activity. The anticipated dwelling numbers for the Epping and Carlingford area (approximately 4000 dwellings) would therefore need to be discounted from any revised dwelling targets for a combined Hornsby/Ku-ring-gai Council.

Hornsby Shire Council currently undertakes a number of planning, compliance, certification and health functions for lands south of the M2 Motorway. These functions include, but are not limited to, the following:

*   Development application assessment

*   Receipt of section 94 contributions

*   Planning proposal evaluation

*   Principal certifying authority (PCA)

*   Essential service (annual fire safety registrar)

*   Swimming pool inspections

*   Section 194 planning certificates

*   Food premises inspections

Should the decision to excise the lands south of the M2 Motorway as part of the Hornsby/Ku-ring-gai proposal be progressed, it will be necessary for the State Government to provide guidance to Hornsby Shire and Parramatta City Councils on the processes and procedures for the transfer of these functions. Specifically, consideration will need to be given to who will be the determining authority for development applications received but not yet determined, transfer of the PCA responsibilities from Council to Council, transfer of current and historic records and statutory status of the Section 94 plans and planning controls until such time as the new relevant council has undertaken a review and established appropriate procedures and legislative framework.

151. The Delegate’s conclusion on this point was:

Submissions concerning the proposed transfer of the area south of the M2 Motorway have been dealt with in another section of this report, however, the concerns are noted and considered.

152. In his final recommendations, in Chapter 6 of his report (pages 41 and 42), the Delegate made no comments concerning the area south of the M2 Motorway except to recommend consideration be given of a further boundary adjustment to transfer an additional area of land, in the vicinity of the excised area, to the enlarged Parramatta City Council. This recommendation was in the following terms:

8.   Consider the merit and financial impact of adjusting the boundary of the new council to the transfer of North Epping to Parramatta if both merger proposals are implemented.

153. None of these matters dealt with the impact on the residents and ratepayers of the area south of the M2 Motorway and now excised and incorporated in the enlarged Parramatta City Council, except in a tangential fashion. The impact on those residents and ratepayers was mandated to be considered by s 263(3)(a).

154. Whilst it was undoubtedly the position that for the Delegate appointed to consider the proposal for the formation of a new local government area to which the excised area was proposed to be added and that that addition would form part of that Delegate’s examination and report, nonetheless the countervailing requirement remained with this Delegate, for the relevant mandated elements of s 263(3) to consider the impact of the excision on the residents and ratepayers of the area proposed to be excised.

155. In this context, I do not have the report of the Delegate who examined and reported on the proposed new local government area to which the excised area has been added, nor would it be appropriate for me to do so. Matters concerning that area, in the context of that Delegate’s functions, were properly a matter for that Delegate and did require that Delegate to have appropriate regard to the proposal to include the excised area. However, in the specific context of the residents and ratepayers of the excised area, this Delegate was obliged to have regard to their excision as part of his examination and reporting functions.

156. In failing to do so, he misapprehended a significant element of what was required of him by s 263(3). It follows that, in this regard, his examination and reporting process miscarried.

The role of the Boundaries Commission

157. When the Minister elects to adopt the option of referring a proposal to the Chief Executive of the Office of Local Government and, thence, by delegation by the Chief Executive to a person specifically tasked to consider the proposal as described above, the role of the Boundaries Commission is a much more constrained one than that which would have arisen had the Minister elected to refer the matter directly to the Boundaries Commission. This constrained role set by the Boundaries Commission in these circumstances is set out in s 218F(6)(b) of the Local Government Act. The role of the Boundaries Commission is confined to reviewing and commenting upon the report of the Delegate.

158. In these proceedings, the Council submits that this role is a broad one, mandating the Boundaries Commission to comment on the merits of matters contained in the Delegate’s report rather than confining itself, as is here the case, to an assessment of whether the Delegate met the statutory enquiring and reporting responsibilities mandated for him by the Local Government Act.

159. In this respect, the Council says that the process undertaken by the Boundaries Commission, as shown from its report to the Minister, did not fulfil the statutory tasks set for it. As a consequence, the Council submits that this is a fundamental failure and that this failure caused this element to miscarry and to do so in such a fashion as to vitiate the process.

160. The Delegate provided, as required by s 218F(6)(a), his report to the Boundaries Commission. Following the provision of his report to the Boundaries Commission, the Boundaries Commission undertook a review of his report and provided its own report to the Minister, commenting on that which had been provided to it by the Delegate. A copy of the Boundaries Commission’s report is in evidence.

161. The Council pleaded its concerns about the role of the Boundaries Commission in Ground 14 of its Second Further Amended Summons in the following terms:

The Fourth Defendant’s [the Boundaries Commission] Comments on the Report by the Delegate dated 22 April 2016 (“Comments”) misunderstood its statutory task, improperly fettered its discretion and thus failed to complete its jurisdictional task.

Particulars

(a) On 22 April 2016, the Fourth Defendant prepared Comments on the Report, in purported compliance with s 218F(6) of the Act.

(b) The Comments were directed to whether the Delegate adequately considered the factors required by section 263(3) of the Act.

(c)   The Comments expressly stated that the Fourth Defendant’s role does not involve re-examining the advantages and disadvantages of the proposed mergers, accepting submissions or holding public inquiries.

(d)   Contrary to the Fourth Defendant’s finding, as part of its function of review and comment, the Fourth Defendant:

i.   May re-examine the advantages and disadvantages of the proposed merger, accept submissions or conduct a further inquiry; and

ii.   Was implicitly required to review the merits of the Report as opposed to merely whether the Report complied with the requirements of the Act.

162. A broadly similar complaint had been heard and determined by Garling J in Botany Bay City Council v State of New South Wales [2016] NSWSC 583. Garling J had rejected that complaint concerning the role of the Boundaries Commission. Garling J's decision was appealed.

163. On 2 September 2016, the Court of Appeal dismissed the appeal against Garling J's decision (see Botany Bay City Council v The State of New South Wales [2016] NSWCA 243). The judgment in those proceedings was written by Sackville AJA (with whom Bathurst CJ and Ward JA concurred). His Honour dealt with the complaint raised by Botany Bay City Council concerning the role of the Boundaries Commission at [91]-[101], saying:

91. In addressing Botany’s submissions, it is convenient to start with the construction of s 263(1) of the LG Act. It will be recalled that s 263(1) requires the Commission (or, in the present case, the Chief Executive) to “examine and report on any matter with respect to the boundaries of areas…which may be referred to it by the Minister”.

92.   This language appears to be very broad. However, in Botany Bay City Council v Minister for Local Government, this Court held that the Chief Executive’s role, where the Minister refers a proposal for examination pursuant to s 218F(1), is constrained by the proposal that is the subject of the referral. The role of the Chief Executive in such a case is to examine and report on the proposal that has been referred by the Minister. Accordingly, the Court upheld the trial Judge’s conclusion that Botany’s separate proposal for the alteration of its boundaries was irrelevant to the Chief Executive’s examination of the Minister’s Proposal.

93.   It follows from the reasoning of the Court in BotanyCouncil,that the functions of the Chief Executive on the referral of a proposal by the Minister are not at large, but are constrained by the purpose of the referral. The stark contrast between the language of ss 218F(1) and 263(1) on the one hand, and s 218F(6) on the other, demonstrates that the functions of the Commission in conducting a review of a report of the Chief Executive are substantially more confined than the functions of the Chief Executive in preparing a report on a proposal by the Minister. Under s 218F(6) the Commission is not to examine and report onthe Minister’sproposal.Instead, the Commission is directed toreview the Chief Executive’s report and send its comments to the Minister.

94. It is no doubt true, as Mr Robinson submitted, that the word “review”, considered in isolation, is capable of describing a reconsideration of the merits of the decision or a proposal. But s 218F(6) must be construed in context. The provision applies to an amalgamation proposal or a proposal that is not supported by at least one of the councils affected. It is the Chief Executive’s report on the proposal, not the proposal itself,that is to be furnished to the Commission for “review and comment”. The Commission is then required to “review the report and send its comments to the Minister”. The “comments” are clearly intended to be the views of the Commission arising from its review of the Chief Executive’s report.

95. Mr Robinson emphasised that, as pointed out by Spigelman CJ in South Sydney, the Commission has expertise in local government issues and enjoys a degree of independence from the Minister. However, these characteristics do not compel the conclusion that the Commission’s role under ss 218F(1) and 263(1) extends to re-examining the merits of a Minister’s proposal that has already been examined by the Chief Executive. The contrast in statutory language to which I have referred demonstrates that the Commission’s expertise and independence are to be utilised for a different purpose. The Commission’s primary function is to review the report already prepared by the Chief Executive and comment whether the Chief Executive has performed his or her functions in accordance with the legislation. If not, the Commission is to make such comments as it considers appropriate in order to assist the Minister in determining whether or not that the Governor implement the proposal, with or without modifications.

96. It is implicit in the language of s 218F(6) that the Commission’s role is not necessarily limited to commenting whether the Chief Executive’s report complies with the statutory requirements. Section 218F(7) contemplates that the Minister may recommend that the Governor implement the relevant proposal with such modifications as arise, inter alia, out of the Commission’s comments on the Chief Executive’s report. This language implies that the Commission, on the basis of its review of the Chief Executive’s report, may draw the Minister’s attention to matters that may warrant modification of the proposal. However, the statutory language does not imply that the Commission must go beyond a review of the Chief Executive’s report and undertake its own independent evaluation of whether the proposal should be recommended for implementation.

97. If Botany’s construction of s 218F(6) of the LG Act were to be accepted, the Commission would be entitled and perhaps bound to re-examine afresh the merits of the Minister’s proposal. Yet, in doing so, it would not be required to observe the statutory procedures that govern the Chief Executive’s examination of the merits of the proposal. For example, the Commission would be free to re-examine the merits of an amalgamation proposal without conducting an inquiry of the kind that the Chief Executive must undertake when examining the proposal on a referral under s 218F (see s 263(2A)). Not only would this set the Chief Executive’s examination of the proposal at nought, it would effectively negate the right of the public to participate in the decision-making process, contrary to the evident intention of the legislation.

98.   Mr Robinson submitted that the Commission’s error was revealed in its statement that:

“the Commission’s role does not involve re-examining the advantages and disadvantages of the proposed merger, accepting submissions and holding inquiries.”

Putting aside the reference to “accepting submissions”, as to which no issue arises in the present case, this statement is unobjectionable. For the reasons I have given, the Commission’s role did not involve re-examining the merits of the Minister’s Proposal. Nor was the Commission empowered by the legislation to conduct inquiries when discharging its function of reviewing the Delegate’s Report.

99.   Mr Robinson did not suggest that the Commission lacked power to make the comments on the Delegate’s Report summarised in Section 1 of the Commission Review. His complaint was that the Commission did not go further. It is, however, one thing to recognise the Commission as having the power to make additional comments on the Delegate’s Report; it is quite another to contend that by choosing not to make additional comments the Commission committed an error of law, let alone a jurisdictional error that might invalidate its report.

100.   It follows from the foregoing that the Commission did not commit any legal error by observing that the name of the new council and the Delegate’s suggestion of a boundary realignment were matters for the Minister. There is nothing in the legislation that obliged the Commission to go any further than to draw these matters to the Minister’s attention with a view to considering whether the merger proposal should be modified.

101.   For these reasons I reject Botany’s challenge to the validity of the Commission Review. It is not necessary to consider whether, if the challenge had been made good, any relief could be granted in respect of the Minister’s public announcement on 12 May 2016.

164. That which Sackville AJA wrote is equally applicable to the complaint by the Council in these proceedings. As a consequence, this ground fails.

Summary of findings

165. As I have concluded that the sole defect in the process conducted by the Delegate and by the Boundaries Commission with respect to the Minister’s proposal for the amalgamation of part of the Hornsby local government area with the whole of the Ku-ring-gai local government area was the failure of the Delegate to fulfil a single, significant element of his responsibilities pursuant to s 263(3), it has been necessary to consider what should be the result.

166. Although this delegate’s process has miscarried in this one respect, for the reasons earlier set out, the failure giving rise to the miscarriage concerns, solely, the Delegate adopting the incorrect position with respect to having regard to the impacts of the proposal on the residents and ratepayers of the area south of the M2 Motorway, an area proposed to be excised from the Hornsby local government area for the purposes of this proposal. The area proposed to be excised has now, as a matter of law, been excised from the Hornsby local government area and now forms part of the City of Parramatta Council local government area as a consequence of the Local Government (City of Parramatta and Cumberland Councils) Proclamation 2016 made on 12 May 2016 (the 12 May Proclamation).

167. There are no proceedings challenging that the 12 May Proclamation or any of the antecedent processes undertaken pursuant to s 263(3) (indeed, there is no challenge, whatsoever, concerning that which has occurred as a consequence of the 12 May Proclamation or any of the statutory steps antecedent to the Governor making it).

165. The ultimate effect of this is that, absent some hypothetical, future excision of that area, that area is, in common parlance, “gone for good”.

166. As a consequence, although I am dealing with circumstances where this Delegate’s function has miscarried in a single, limited regard, the process undertaken with respect to the flipside of the coin, as it were, has been completed, leading to an irretrievable legal result with the only possible rectification, in the future, involving political and policy considerations entirely outside the scope of these proceedings.

Discretion

170. During the course of the hearing, I asked Mr Kennett what the Council submitted should be the outcome if I were to reach the conclusion (as I have now done) that the sole defect in the process was the matter pressed by the Council concerning the deficiency in the Delegate's consideration of the impact on the residents and ratepayers of the area south of the M2 Motorway. I made this enquiry because, if that were to be the sole ground, matters of discretion would arise as to whether any relief should be ordered. My exchange with Mr Kennett was in the following terms (Transcript 7 June p 89 L 36 to p 90 L 21):

KENNETT: Your Honour, the next matter I was going to come to was the matter that you raised with me just before lunch, which is what the implications are of the excision of an area of Hornsby having already occurred, should the matter go back to the delegate. And this is on the assumption, I think as your Honour put to me, that that's the only basis on which‑‑

HIS HONOUR: I understand that.

KENNETT: Firstly, as I think I acknowledged on Thursday, the circumstance that the delegate would be faced with and would have to consider would be the revised or the smaller Hornsby, the excision of the area south of the M2 being a fait accompli and, as we've said, nobody has challenged the proclamation that brings that about. And whether somebody in a process such as this might recommend that the excision be reversed is a matter for another day.

HIS HONOUR: Well, that would be a new proposal, wouldn't it, in terms of‑‑

KENNETT: At least arguably, yes, I don't want to suggest that that's a necessary step.

HIS HONOUR: You're not inviting me to go there, I'm assuming.

KENNETT: No. If the only basis upon which we concede it was what I was putting to you just before lunch, which is that the delegate had failed properly to consider the effects of the excision and the position of ratepayers in that excised area. We would say that if that's an error of law and an error going to the delegate's jurisdiction, then it is still an error, even if the practicalities of the matter have changed by the time it gets back to him, so that the report is ultra vires or invalid or however one wishes to describe it, prima facie at least, my client is entitled to have it set aside.

The only reason why your Honour might consider not setting it aside would be a question of utility. As to that, there is utility for my client because, with the report having been set aside, the delegate would, effectively, have to begin - or a delegate, not presupposing who it would go to, would need to start again and we would have a chance to convince that delegate of everything.

171. It is settled that the making of a bare declaration is inappropriate when such a declaration would have no foreseeable consequences for the parties (Gardner v Dairy Industry Authority (NSW) (1978) 52 ALJR 180 per Mason J at 188 and Aickin J at 189). The making of such a declaration in these proceedings would have no functional value of a prophylactic nature (contra the position in Ainsworth v Criminal Justice Commission (1991-1992) 175 CLR 564 per the plurality at 582).

172. As Gaudron J observed, in Truth about Motorways Pty Limited v Macquarie Infrastructure Investment Management Limited (2000) 200 CLR 591; [2000] HCA 11 at [52], there may be cases where a bare declaration that some legal requirement has been contravened will serve to redress some or all of the harm brought about by that contravention. However, it seems to me that an appropriately framed declaration would have no utility in these proceedings in circumstances where there is absolutely no other defect in the process undertaken for this proposed amalgamation.

173. As a consequence, I have concluded that I am unable to agree with Mr Kennett’s proposal that I should, in effect, use this confined defect in the Delegate’s carrying out of his function as a basis to set aside the totality of the process and, in effect, return the matter to the Acting Chief Executive to permit a further process to be undertaken pursuant to s 263 of the Local Government Act (whether by Mr West or by a different delegate then being a matter for the Acting Chief Executive).

174. Although the Delegate’s process for this proposal has miscarried in a single (albeit important) aspect, the consequence of that failure has now been rendered immaterial as a consequence of the 12 May Proclamation creating the new local government area into which the area south of the M2 Motorway, formerly in the Hornsby local government area, has now been incorporated.

175. Requiring the Delegate to examine and report upon the matters inherent in the consideration of the excised area would be futile, as the excised area cannot be “recovered”, and the report of the Delegate in his consideration of the remaining aspects he was required to examine and report upon contain no defects requiring the conclusion that the Delegate’s functions miscarried in any other respect.

176. It therefore remains for me to consider what, as a matter of discretion, I should do as a consequence of my finding that the Delegate’s process for this proposal miscarried in the narrow fashion I have earlier set out.

177. Ordinarily, it might be expected that the outcome of this conclusion would be a declaration that the Delegate’s process had miscarried and, perhaps, an injunction restraining the Minister from making any recommendation to the Governor founded on the Minister’s consideration of the Delegate’s report and recommendation and the comments on the Delegate’s report provided to the Minister by the Boundaries Commission.

178. Such a process, in effect, would leave it open to consideration by the Acting Chief Executive to recommence the process or have the Delegate rectify the defect found. If, on the other hand, having regard to the fact that the defect in the Delegate’s process is one that can no longer impact on the implementation of the process should the Minister determine to proceed with it in the fashion envisaged by s 263(7), there is no defect in the Delegate’s examination and reporting process, nor in the comments made by the Boundaries Commission upon it arising out of that body’s review of the Delegate’s report, that would act as an impediment to the Minister doing so.

179. Whilst it is also the position that the making of a bare declaration without granting any consequential relief might have the effect of admonishing the Delegate, such a process should not be undertaken as it would lack any practical effect and thus be contrary to authority as earlier discussed.

180. As a consequence of there being no other defect in any aspect of that which has been undertaken concerning this proposal, other than a defect for which there is no practical remedy, I have concluded that it would not be appropriate, in effect, to require the process to restart by restraining the Minister from acting on the Delegate’s report.

Conclusion

181. I have concluded that the only defect in the process undertaken concerning this proposed merger was a failure by the Delegate to give adequate consideration to one aspect of the mandatory matters to which he was required to have regard, by the terms of s 263(3) of the Local Government Act, in his examination of and reporting on the proposed merger.

182. This defect was his failure to consider the impact of the proposed merger on the residents and ratepayers of the area south of the M2 Motorway that had been portion of the Hornsby Shire Council local government area. However, as that area south of the M2 Motorway has been excised from the Hornsby Shire Council local government area and incorporated in the expanded Parramatta City Council (by virtue of the 12 May Proclamation), there is no functional utility in making a declaration that would have the effect of setting aside the Delegate's report until he had remedied this omission.

183. As the mere making of a declaration about the extent to which the Delegate’s process has miscarried without granting any relief for it would be inappropriate, the outcome, after consideration of relevant discretionary matters, must be the dismissal of the proceedings.

Costs

184. Although the proceedings are to be dismissed, for the reasons of lack of practical utility in doing otherwise, the Council has succeeded on one of the grounds advanced. How this should be dealt with in the context of any costs order was not considered during the hearing. It is therefore appropriate that costs be reserved.

Orders

185. Therefore, the orders of the Court are:

1. The proceedings are dismissed; and

2. Costs are reserved.

**********

Amendments

21 September 2016 - Changes to appearances for the Respondent on the cover sheet.

Decision last updated: 21 September 2016