Mornington Peninsula Beach Box Association Inc v Mornington Peninsula Shire Council
[2021] VSC 455
•3 August 2021
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
JUDICIAL REVIEW AND APPEALS LIST
S ECI 2018 01771
| MORNINGTON PENINSULA BEACH BOX ASSOCIATION INCORPORATED | First Plaintiff |
| MEREDITH ANNE LYONS | Second Plaintiff |
| v | |
| MORNINGTON PENINSULA SHIRE COUNCIL | Defendant |
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JUDGE: | CAVANOUGH J |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 1 August 2019 Last written submissions filed 23 August 2019 |
DATE OF JUDGMENT: | 3 August 2021 |
CASE MAY BE CITED AS: | Mornington Peninsula Beach Box Association Inc & Anor v Mornington Peninsula Shire Council |
MEDIUM NEUTRAL CITATION: | [2021] VSC 455 (Second Revision 10 August 2021) |
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STATUTORY INTERPRETATION – Local government – Local Government Act 1989 (Vic) providing for ‘annual service charge’ to be declared on rateable land for ‘the collection and disposal of refuse’ – Charge declared by defendant Council for ‘the collection and disposal of municipal refuse’ – Charge designed to finance broad range of waste services for local community and its members – Whether declaration valid – Declaration need not be confined to recovery of costs of direct or ‘kerbside’ refuse collection services only – Charge can validly apply to rateable land for which no direct or kerbside refuse collection service is available – Challenge to validity of charge dismissed – Constitution Act 1975 (Vic) Pt IIA – Crown Land (Reserves) Act 1978 (Vic) s 17B – Environment Protection (Resource Recovery) Act 1992 (Vic) – Health Act 1958 (Vic) ss 60, 61 – Health (Amendment) Act 1977 (Vic) – Local Government Act 1919 (NSW) ss 168, 243, 615 – Local Government Act 1958 (Vic) s 267 – Local Government Act 1989 (Vic) ss 1A, 3C, 3E, 3F, 113, 125, 126, 127, 155, 156, 157, 158, 158A, 159, 160, 161, 161A, 162, 163, 163A, 163B, 173, 184, 208A, 208B, 208C, 208D, 221, 223 – Local Government Act 2020 (Vic) – Supreme Court (General Civil Procedure) Rules 2015 (Vic) Order 56.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiffs | C Tran and TM Wood | Kellehers |
| For the Defendant | E Nekvapil | Russell Kennedy |
HIS HONOUR:
Introduction and overview
This is a challenge to the legal validity of a declaration made by a municipal Council on 12 June 2018 imposing on rateable land in its municipal district, for the financial year 2018–2019, a compulsory charge to recover costs expected to be incurred by the Council in providing waste services for its local community during that financial year. The declaration was made in reliance on certain provisions of the Local Government Act 1989 (Vic) (‘the Act’). It is common ground that the Council had power under the Act to recover costs of the relevant kind by putting compulsory imposts on rateable land. The issue is whether the particular form of impost was available to the Council in the circumstances.
Perhaps irregularly, this proceeding has been brought by way of originating motion for judicial review under Order 56 of the Supreme Court (General Civil Procedure) Rules 2015 (‘the Rules’). None of the forms of relief for which Order 56 provides was sought by the plaintiffs in their originating motion as originally filed or in their amended originating motion.[1] Moreover, the subject matter of the proceeding is a resolution of the Council the effect of which was to impose a general rule to apply throughout the municipal district for 12 months, being therefore, in my view, a resolution of a legislative or quasi-legislative nature, more so than a discrete act of an administrative or judicial nature affecting an individual or a confined group. Principally, at least, the Order 56 procedure is intended for challenges to things in the latter class, rather than the former. It seems to me that this challenge would have been more suitably brought by writ or by ordinary originating motion seeking declaratory and injunctive relief.[2] There is also a doubt as to whether, as a proceeding under Order 56, it was brought within time. However, the defendant Council has not taken, or no longer takes, any of these procedural points, and, as I will further explain,[3] they need not be finally decided.
[1]But see [21]–[22] below.
[2]DC Pearce and S Argument, Delegated Legislation in Australia (LexisNexis Butterworths, 5th ed, 2017) [26.3], [26.8]–[26.10]; Minister for Youth and Government Services v Kew Cottages and St Nicholas Parents Association Inc (1996) 10 VAR 293 (Court of Appeal), esp at 297, 299, 302.
[3]See [21]–[22] below.
As mentioned above, the Council’s declaration was made in reliance on the Act. Accordingly, its validity depends on the meaning and effect of the relevant provisions of the Act, as in force at the time (June 2018) when the declaration was made and during the period (2018–2019) to which it related. Since then, many provisions of the Act have been amended, and in certain respects superseded, by the provisions of the Local Government Act 2020. However, the provisions of the (1989) Act of most relevance to the issues in this case happen to remain in force or to have close counterparts in the new legislation, and it appears that the defendant Council has continued to make similar annual declarations. Hence, the outcome of this proceeding may have ongoing significance.
Under the Act as it was in force during the period June 2018 to June 2019 (and during several previous years), the functions of a municipal Council included ‘planning for and providing services and facilities for the local community’[4] and ‘raising revenue to enable the Council to perform its functions’.[5] The Act provided (and still provides) for Councils to prepare budgets.[6] It provided (and still provides) for Councils to raise revenue in various ways. For example, Councils could (and still can) make local laws imposing fees or charges in relation to the provision of goods or services or access to property.[7] Councils could (and still can) engage in entrepreneurial activities.[8] And, of more direct relevance for the present case, Councils could (and still can), under Part 8 of the Act, ‘declare’ rates and charges of various specified kinds and combinations on rateable land.[9] Generally speaking, the owner of the rateable land was (and still is) liable to pay the declared rate or charge.
[4]The Act, s 3E(1)(b). The expression ‘local community’ was defined in s 1A(4) of the Act as follows:
(4)local community includes –
(a)people who live in the municipal district; and
(b)people who are rate payers; and
(c)people and bodies who conduct activities in the municipal district.
[5]The Act, s 3E(1)(e). There are comparable provisions in the new legislation: see eg, Local Government Act 2020, ss 9, 106. See also s 3 (definition of ‘municipal community’).
[6]The Act, s 127.
[7]The Act, s 113.
[8]The Act, s 193.
[9]See esp ss 155, 158, 162 and 163 of the Act. Councils could (and still can) also impose, on non-rateable land, an ‘annual service charge’ for certain specified services: the Act, s 221.
One type of charge provided for under Part 8 was (and still is) a charge referred to in s 162(1)(b) of the Act as an ‘annual service charge’ for a service or services described as ‘the collection and disposal of refuse’, being a charge within a broader class of charges referred to in s 155(d) of the Act as ‘service charges under section 162’. The charge in question in this case was declared in reliance, at least mainly, on ss 155(d) and 162(1)(b). In effect, it was framed so as to recover the anticipated costs of all waste services proposed to be provided by the Council to or for the benefit of its ‘local community’[10] in 2018–2019. The plaintiffs contend that ss 155(d) and 162(1)(b) did not authorise the charge. They say that the power conferred by those provisions did not extend to cover all waste services provided by a Council. The plaintiffs have had considerable difficulty in articulating their case, and in particular in articulating an alternative, relevantly limited, construction of ss 155(d) and 162(1)(b). Ultimately, following multiple changes to their case,[11] the plaintiffs now appear to submit that a charge under ss 155(d) and 162(1)(b) was not available to recover the costs of waste services to be provided to the local community as a whole and was required to be limited to the recovery of, only, the costs or anticipated costs of collecting waste, or of being prepared and willing to collect waste, from those individual properties to which the charge was to apply, together with the costs or anticipated costs of disposing of that particular waste. The plaintiffs also appear now to advance an alternative contention to the effect that, even if the costs of indirect or general waste services provided to the local community as a whole could be included in the costs to be recovered, a charge of the kind referred to in ss 155(d) and 162(1)(b) could only be made applicable to those particular properties for which a direct refuse collection and disposal service was to be provided or offered by the Council.
[10]See fn 4 above.
[11]See further below.
In my view the challenge fails. On the proper construction of ss 155(d) and 162(1)(b), read in the context of the Act as a whole, the power of the Council to declare a charge under those provisions was not limited in either of the ways suggested by the plaintiff. The charge in question was valid.
In consequence, this proceeding must be dismissed.
The parties
The first plaintiff is an incorporated association representing the interests of persons who occupy beach boxes and boat sheds (‘beach boxes’) within the Mornington Peninsula Shire. There are about 1,300 beach boxes in the Shire. The beach boxes are held on licences from the Crown under s 17B of the Crown Land (Reserves) Act 1978 and are managed by committees of management under s 14 of that Act. The second plaintiff, Ms Lyons, is the occupier of one of the beach boxes. Although situated on Crown land, the beach boxes are privately occupied. Therefore, the land on which they sit is rateable under the Act.[12] The occupiers of the beach boxes are liable to pay any valid rates and charges on the properties.[13] The defendant, Mornington Peninsula Shire Council, is a Council under the Act.[14]
[12]The Act, s 154(1) and (2)(a).
[13]Ibid, s 156(3).
[14]The defendant Council also happens to be the committee of management for some 800 of the 1,300 beach boxes located within the Shire.
The ‘Waste Service Charge’
As from 1 July 2016, the defendant Council made certain changes to the manner in which it financed its operations. Among other things, it declared for the first time a compulsory charge which it called a ‘Waste Service Charge’. The charge was declared to be for ‘the collection and disposal of municipal refuse’. The amount of the Waste Service Charge was calculated so as fully to recover the budgeted net cost to the Council of waste-related operations for the upcoming financial year, ie the cost remaining after allowing for other expected waste-related receipts in the form of tip fees, opt-in fees and the like. For 2016–2017, the charge was set at a flat amount of $193 for each rateable property in the Mornington Peninsula Shire, with the exception of two classes of properties that were covered by separate statutory rating regimes. Beach boxes, not being in those excepted classes, were within the scope of the Waste Service Charge.
A year later, the Council made a corresponding declaration for the 2017–2018 year, with the charge set at $197.
Another year later, on 12 June 2018, the Council made a corresponding declaration for the 2018–2019 financial year, setting the charge at $241 for each rateable property. For that year, the total budgeted amount for the Waste Service Charge was approximately $24 million. As indicated above, and as explained in more detail below, the declaration of 12 June 2018 is the subject of this proceeding.
As is also indicated above, it appears that the Council has continued to declare an annual ‘Waste Service Charge’. However, it is not necessary, and it would not be appropriate, for me to pronounce formally upon the validity of any Waste Service Charge declared in respect of a period after (or before) 2018–2019.
The directly relevant provisions of the Act
The Council maintains that the Waste Service Charge of 2018–2019 was authorised by the Act, and by ss 155(d) and 162(1)(b) of the Act in particular. Section 155 of the Act listed (and still lists) six kinds of rates and charges that a Council may declare on rateable land. The list includes ‘service rates under section 162’ and ‘service charges under section 162’.
Sections 155 and 162 of the Act were (and are) as follows:
155. What rates and charges may a Council declare?
A Council may declare the following rates and charges on rateable land—
(a) general rates under section 158;
(b) municipal charges under section 159;
(c) service rates under section 162;
(d) service charges under section 162;
(e) special rates under section 163;
(f) special charges under section 163.
…
162. Service rate and service charge
(1)A Council may declare a service rate or an annual service charge or any combination of such a rate and charge for any of the following services—
(a) the provision of a water supply;
(b) the collection and disposal of refuse;
(c) the provision of sewage services;
(d) any other prescribed service.
(2)A service rate or service charge may be declared on the basis of any criteria specified by the Council in the rate or charge.
This proceeding
As stated above, the plaintiffs challenge, purportedly under Order 56 of the Rules, the legal validity of the Waste Service Charge as it was declared by the Council on 12 June 2018 for 2018–2019. In short, they say that the Waste Service Charge was not within the powers conferred on the Council by ss 155 and 162 of the Act and was not otherwise within power.
As will be seen, there is little or no dispute between the parties about the relevant facts. The case turns mainly on the true meaning and effect of ss 155(d) and 162(1)(b) of the Act, in their statutory context.
The essence of the parties’ cases as ultimately advanced
As already mentioned, and as I will further indicate in due course, the plaintiffs’ case has varied considerably over time. However, as ultimately put, the plaintiff’s case may, it seems, be summarised as follows: an annual service charge under ss 155(d) and 162(1)(b) can only be imposed for and by reference to a service or proposed service in the nature of the collection and disposal of refuse, being a service or proposed service provided, or offered to be provided, by the Council directly to the land on which the charge is imposed. It cannot be used to recover the costs of any other waste services. According to the plaintiffs, that limitation is implicit in ss 155(d) and 162(1)(b), read in context. Here, the charge was not framed by reference to a proposed direct collection and disposal service for each property on which it was imposed. Rather, it was calculated to recover the costs of a large range of proposed waste services, including services to be provided to the local community generally. It amounted to a tax, and ss 155(d) and 162(1)(b) do not authorise the imposition of a tax. As a result, the plaintiffs contend, the Waste Service Charge declared for 2018–2019 was wholly invalid. Alternatively, the plaintiffs say, whether or not the costs of waste services other than services provided directly to rateable land can be included in what is to be recovered by way of an annual service charge, such a charge can only have valid application to those properties for which a direct Council service (in the nature of collection and disposal of refuse) is to be provided. On that (alternative) view, the plaintiffs submit, the Waste Service Charge was invalid in its application to beach boxes, because no waste collection services were proposed to be provided directly to beach boxes.
The Council denies that the power to declare an annual service charge under ss 155(d) and 162(1)(b) is limited in either of the ways suggested by the plaintiffs as summarised above. The Council submits that ss 155(d) and 162(1)(b) authorised it to impose the Waste Service Charge for 2018–2019, because the charge was an annual service charge on rateable land; because it was for the collection and disposal of refuse; and because, for the purpose of s 162(2), it was declared on the basis of criteria ($241 per annum for each rateable property) specified by the Council in the charge. The Council accepts that the Waste Service Charge, being a flat amount, is not to be characterised as being, or as including, a service ‘rate’ under s 162(1)(b). Nor does the Council rely on any of its other specific rating powers under the Act to justify the Waste Service Charge. Rather, the Council says, on the proper construction of the Act as a whole, ‘charges’ under ss 155(d) and 162(1)(b) may be levied for proposed waste services that are, or proposed waste services that include, waste services to be provided for the benefit of the local community generally. It matters not whether the Waste Service Charge amounts to a tax. In response to the plaintiffs’ alternative argument, namely that an annual service charge under ss 155(d) and 162(1)(b) must be for services that at least include a waste collection and disposal service provided directly to the land of the person to be charged, the Council says that no such requirement exists. In any event, the Council says, the plaintiffs have not shown that any such requirement was not met by the Council. In that regard, the Council points to four things: a ‘service’ consisting of its provision of certain waste disposal vouchers to all rate payers, including beach box occupiers, together with three other ‘services’ said to be of particular benefit to beach box occupiers, being beach cleaning, the provision of foreshore litter bins and drain clearing.[15]
[15]More details about these four things are set out below.
My short response
As indicated above, I agree with the Council that its power to declare an annual service charge under ss 155(d) and 162(1)(b) of the Act was not subject to either of the limitations suggested by the plaintiffs. I accept that an annual service charge could be imposed under ss 155(d) and 162(1)(b) of the Act, on any rateable land in the municipal district, to recover the cost of services proposed to be provided by the Council in the nature of the collection and disposal of refuse, whether those services were to be provided to particular properties in the municipal district or to the ‘local community’ more broadly. I agree that it matters not whether the Waste Service Charge amounted to a tax. As to the plaintiffs’ alternative argument, I would acknowledge that none of the four particular waste-related services that the Council relies on in this regard amounted to a waste collection and disposal service provided by the Council directly to the land charged. However, I accept the Council’s submission that the Waste Service Charge could validly be imposed on rateable land in relation to which no direct refuse collection and disposal service at all was to be provided. If it mattered, I would accept also that beach box occupiers, as a class, stood to gain some direct or indirect benefit from each of the four waste-related ‘services’ on which the Council relies.
In my view, the Waste Service Charge was wholly valid.
Procedural aspects and time limit
This proceeding was commenced on 12 October 2018. As mentioned above, it was so commenced by the filing of an originating motion, purportedly under Rule 56.01 of the Rules, but the relief claimed did not expressly include any of the remedies (such as orders in the nature of certiorari or mandamus) referred to in Order 56. Rather, in the prayer for relief, the plaintiffs claimed certain (judicial) declarations, certain injunctions, costs and ‘any further order as the Court thought fit’. Later, on 23 May 2019, by leave of a Judicial Registrar, the plaintiffs filed an amended originating motion. However, even then there was no claim for any of the forms of relief referred to in Order 56. On the other hand, in written submissions filed in June 2019, shortly before the oral hearing, the plaintiffs asserted that they sought, in addition to the (judicial) declarations, an order in the nature of certiorari to quash the Council’s declaration of 12 June 2018, although they acknowledged at the same time that an order in the nature of certiorari was not ‘presently sought’.[16] No formal application to further amend the originating motion has been made. In any event, for the reasons mentioned above,[17] the plaintiffs’ invocation of Order 56 would arguably remain irregular notwithstanding any amended claim for an order in the nature of certiorari. However, the defendant Council has at no stage taken this point. In those circumstances, and because, as indicated in the next paragraph, any problem as to time can be and will be dealt with, and because the proceeding must be dismissed on the merits in any event, I need not and will not finally decide whether this case was or is appropriately brought under Order 56.
[16]Court Book (‘CB’) 24.
[17]See that part of the text of [2] above to which fn 2 relates.
If this case were truly a case required by the Rules to be commenced under Order 56, it would, it seems, have been commenced out of time. Rule 56.02(1) requires that a proceeding under Order 56 be commenced within 60 days after the date when grounds for the grant of the relief or remedy claimed first arose. That time may only be extended in ‘special circumstances’: r 56.02(3). If there were any grounds for the grant of the relief or remedy claimed in this case, those grounds presumably arose on 12 June 2018, when the Council’s declaration was made, or, at the latest, on 1 July 2018, when the Council’s declaration first took effect to impose a liability on ratepayers. However, as mentioned above, the proceeding was commenced on 12 October 2018. That date was more than 60 days after the date of the Council’s declaration (12 June 2018) and also more than 60 days after 1 July 2018. On the other hand, if in truth this proceeding was not required to be brought under Order 56 at all, then the time limit of 60 days prescribed by Rule 56.02 was possibly not applicable, except perhaps by analogy.[18] The Council did not take any point about time at the final hearing, although it appears that the Council had raised such a point previously.[19] I infer that the Council now concedes either that an extension of time was not required[20] or that there were ‘special circumstances’ within the meaning of Rule 56.02(3) warranting an extension of time. In any event, out of caution, I will make an interlocutory order under Rule 56.02 extending, to the extent (if any) necessary, the time for the commencement of the proceeding. That will dispose of any problem as to time that might otherwise have arisen.
[18]See Minister for Youth and Government Services v Kew Cottages & St Nicholas Parents Association Inc (1996) 10 VAR 293 (Court of Appeal), esp at 297, 299, 302.
[19]That the point was previously raised appears from a set of directions made by Judicial Registrar Clayton, by consent, on 8 November 2018, under which any application for an extension of time under Rule 56.02 was to be made by summons supported by affidavit to be filed by 14 December 2018 and, subject to any further order, was to be listed for hearing with the trial of the proceeding. It seems that no such summons or supporting affidavit was filed.
[20]Perhaps the Council itself now takes the view that the proceeding was not required to be commenced under Order 56.
The plaintiffs’ standing
Until a late stage, the Council objected to the standing of the Association to bring this proceeding. The Council also contended that Ms Lyons could have brought her individual challenge by way of an appeal to the County Court under s 184 of the Act, and that that was a discretionary reason for the Court to refuse to entertain Ms Lyons’ case. However, during the hearing before me, counsel for the defendant expressly abandoned its objection to the Association’s standing.[21] That then made the defendant’s objection to Ms Lyons’ position pointless. Accordingly, it was not pressed.[22]
[21]Transcript of hearing before Cavanough J on 1 August 2019 (‘transcript’), 92. See also transcript 55–56.
[22]In any event, the Council’s objection would probably have failed, because s 184 of the Act does not appear to permit a challenge to the legal validity of a charge as a whole. See R v Paddington Valuation Officer [1966] 1 QB 380; compare Joseph v Melbourne Water & Anor [2010] VCAT 1414 [8]–[ 11].
Evidence and findings of fact
All of the evidence in this case was given by way of affidavits filed by the plaintiffs. The deponents were the President of the Association, Mr Christopher Maine, and the second plaintiff herself, Ms Lyons. The exhibits consisted mainly of published records of various relevant proceedings of the Council and correspondence between the Association and the Council. At the hearing, the Council raised some minor objections to certain statements made in the affidavits, but ultimately these were resolved with little or no controversy. Thereafter the Council confirmed that neither deponent was required for cross-examination.
It is common ground that, commencing in 2016 and continuing annually thereafter, the Council declared two different kinds of ‘annual service charge’ under ss 155(d) and 162(1)(b) of the Act. In addition to the Waste Service Charge, there was what the Council called an ‘annual opt-in green waste service charge’. The relevant Council minutes record both charges under the heading ‘Services Charges’. The amount of the annual opt-in green waste service charge was set originally at $135 per annum and remained at that level for each of the relevant years. Thus, for the 2018–2019 financial year, the terms of the formal declarations of the service charges, as recorded in the Council Meeting Minutes of 12 June 2018, were as follows:[23]
[23]CB 83.
Services Charges
13.An annual Waste Service Charge be declared for the collection and disposal of municipal refuse.
14.The annual Waste Service Charge be $241.00 for each rateable property with the only exceptions being:
14.1Properties rated under the Cultural and Recreational Lands Act 1963; and
14.2Properties subject to the Westernport (Steelworks Rating) Act 1971 [sic, scil Western Port (Steel Works Rating) Act 1972].
15.An annual opt-in Service Charge be declared for the collection and disposal of refuse taking the form of green waste.
16.The annual opt-in green waste service charge be $135.00 for each service of one 240 litre green waste bin for each rateable land (or part) located within the eligible service areas in respect of which the owner has given notice to Council that the collection and disposal of green waste from the land is desired.
During their oral submissions, albeit before the nature and bounds of the plaintiffs’ attack on the Waste Service Charge had been fully and finally argued, counsel for the plaintiffs invited me to make three findings of fact.
In the first place, counsel invited me to find ‘that the Waste Service Charge was declared to recoup the cost of all waste services provided in the area, irrespective of whether a particular person levied with the charge has received any or all of those services’.[24]
[24]Transcript, 18–19.
However, a finding in those precise terms would not be entirely appropriate. As I have already mentioned, and as the evidence shows, for each relevant financial year the amount of the Waste Service Charge declared was worked out in advance to meet the budgeted cost of the Council’s waste services for that financial year. Hence, strictly speaking, there is no occasion now for a retrospective inquiry into what was actually done by the Council by way of the provision of waste services in the 2018–2019 financial year (or in any other period). An inquiry into whether particular persons levied with the charge actually received the services would have been inappropriate for an additional reason. At the hearing, the plaintiffs’ counsel accepted that, on the plaintiffs’ case, what mattered was whether services were provided to the property, irrespective of whether or not the actual owner or occupier happened to use the services on a particular day or during a particular month or the like.[25]
[25]Transcript, 37–38. Compare transcript 149–150, where counsel for the plaintiffs suggested that a Council might be precluded from imposing an annual service charge under s 162(1)(b) on residential land where the householder told the Council that a direct rubbish removal service was not wanted at all.
However, on the other side, the Council has always accepted, and I find, (i) that the Waste Service Charge was declared with a view to the recoupment of the whole of the budgeted net cost[26] to the Council of all those proposed activities which the Council treated as answering the description of a service by way of ‘the collection and disposal of refuse’ for the purposes of s 162(1)(b) of the Act; (ii) that, in declaring the Waste Service Charge, the Council proceeded on the view that that description extended to waste services to be provided to the local community (regarded generally or as a whole); and (iii) that, in declaring the Waste Service Charge, the Council proceeded on the view that services for which a charge could be imposed under ss 155(d) and 162(1)(b) did not need to be tied to, much less confined to, services to be provided directly to or in respect of the particular rateable properties on which the charge was to be declared.
[26]As already mentioned, in working out the budgeted net cost, allowance was made for expected receipts in the form of tip fees, opt-in fees (such as the abovementioned annual opt-in green waste service charge) and the like.
Thus, when the Waste Service Charge was first introduced in 2016, the minutes of the relevant special meeting of Council contained the following statement:[27]
[27]CB 217.
A Waste Service Charge has been introduced and is intended to recoup the full cost of the collection and disposal of refuse. These costs include expenditure on collection, disposal, street sweeping, footpath sweeping, street and drain litter collection, beach cleaning, waste disposal contracts, green waste process costs, waste management leachate treatment, ground water monitoring and the State government landfill levy.
Further detail was given in the adopted budget for 2016-2017, in which it was stated:[28]
[28]CB 278.
Under s 162(b) [sic] of the Local Government Act1989 Council may raise a service charge for ‘the collection and disposal of refuse’.
Council has introduced a waste service charge designed and intended to fully recover the costs of the collection and disposal of refuse including:
•Collection of waste and refuse – including:
◦ Kerbside waste collection
◦ Kerbside recyclables collection
◦ Kerbside hard waste collection
◦ Street sweeping
◦ Footpath sweeping and cleaning
◦ Street litter bin collection
◦ Drain litter collection
◦ Beach cleaning
•Disposal of waste and refuse – including:
◦ Waste disposal contract costs
◦ Green waste process costs EPA audit recommendations implementation at the Rye Landfill
◦ Risk management initiatives at former Shire Landfills
◦ Rye Landfill capping provision
◦ Waste management leachate treatment
◦ Ground water and surface water monitoring
◦ Landfill facility for solid waste
◦ State Government Landfill levy
The Waste Services Charge will be applied to assessments for all property types with the only exceptions being:
•Properties rated under the Cultural and Recreational Lands Act 1963
•Properties subject to the Westernport (Steelworks Rating) Act 1971 [sic, scil Western Port (Steel Works Rating) Act 1972]
The Waste Service Charge continued to be framed for 2017–2018 and 2018–2019 so as to achieve the recovery of all of the Council’s net budgeted costs for services which it regarded as waste services. Thus in the Adopted Budget for 2018–2019 the following appeared:[29]
Waste Service Charge is based on the full cost recovery of waste services including collection, disposal, street sweeping, footpath sweeping plus street and drain litter collections. The increase in costs in providing these services during the year and the impact of China’s ban on recycling imports required the Council to further review the Waste Service Charge and the Council determined to increase it to $241 from $197, which reflects 22.3% increase on the previous year.
[29]CB 711.
The second finding of fact that the plaintiffs invited me to make was that the Association had had a longstanding involvement in contesting the Waste Service Charge.[30] However, this invitation was overtaken by the Council’s subsequent concession as to the Association’s standing. The invitation need not be addressed.
[30]Transcript, 45–46.
The third finding of fact sought was that the occupiers of the beach boxes do not receive direct waste collection and disposal services particular to their properties. The Council accepts, and I find, that there was no intention to provide ordinary kerbside domestic rubbish collection services directly to the beach boxes. Nor have they been provided. Such services would not have been appropriate, because beach boxes are not residential; and they would not have been practicable, because most of the beach boxes are not accessible by a rubbish truck.
In this regard, as mentioned above, the Council points, in purported support of its answer to the plaintiffs’ alternative argument, to the waste disposal vouchers, the beach cleaning, the foreshore litter bins and the drain clearing. As mentioned above, and as I will explain in more detail below, in my view none of those four things answers the plaintiffs’ alternative argument as it was eventually formulated; but that is of no consequence because the plaintiffs’ alternative argument falls at an earlier hurdle. Nevertheless, given the time and attention that the parties have devoted to the four things, I will deal now with the evidence and the facts relating to them.
I turn first to the waste disposal vouchers. Three vouchers for the disposal of green and hard waste at Council waste disposal centres were issued free to all ordinary ratepayers, attached to their annual rate and valuation notices. In 2018–2019, the following appeared on the back of each voucher:[31]
Don’t forget, for Waste Disposal Centres, 1 voucher equals 1 cubic metre of green waste OR ½ cubic metre of hard waste.
[31]CB 88.
It is common ground that beach box occupiers were precluded by law from cutting back beach vegetation.[32] On that basis the plaintiffs say that the green waste element of the vouchers was of no use to beach box occupiers. They also submit that there is no evidence about any system for using the vouchers or about the monetary value, if any, of the vouchers. However, in my view, the vouchers speak for themselves. I infer that the vouchers could have been used to eliminate fees that would otherwise have been charged at Council waste disposal centres for the disposal of green and hard waste in quantities up to the limits stated on the backs of the vouchers. Indeed there is other, unchallenged evidence to the same effect.[33] Further, green waste might have been generated around beach boxes without the occupiers cutting back any vegetation. In any event, the vouchers were able to be used by their holders for the disposal of green waste, or, for that matter, hard waste, generated anywhere. And the plaintiffs do not suggest that beach box occupiers could make no use of the vouchers for the disposal of hard waste. On the other hand, the vouchers were, of course, for use only at Council waste disposal centres. They did not entitle their holders to any rubbish collections by the Council directly from the rateable properties themselves.
[32]Transcript, 15.
[33]See the reference in the next paragraph to the Council’s 2019 discussion paper.
It is also common ground, and I find, that the three vouchers were issued not only to all ordinary ratepayers but also to the owners of the properties comprised within the two property classes exempted from the Waste Service Charge, namely properties rated under the Cultural and Recreational Lands Act 1963 (being mainly sporting clubs) and properties subject to the Western Port (Steel Works Rating) Act 1972. The plaintiffs submit that this means that the cost to the Council of providing the vouchers was not sought to be recovered as part of the Waste Service Charge. I disagree. A discussion paper issued by the Council in early 2019 includes among a list of ‘waste disposal’ services provided by the Council:[34]
Provision of 3 vouchers with the rates notice for the disposal of hard and green waste at no charge.
And, as already mentioned, the Council has stated several times over the years that the Waste Service Charge was designed to recoup all of the Council’s net expenditure on waste services. The mere fact that there were two classes of properties exempted from the Waste Service Charge does not gainsay that the Council factored the cost of the vouchers into its calculations of the amount of the Waste Service Charge.
[34]Exhibit ‘CKM–23’ to the supplementary affidavit of Christopher Kenneth Maine sworn 18 July 2019, second page.
The plaintiffs accept that the Council provided beach cleaning services and drain clearing services. They also accept that there were some Council–provided litter bins dotted around the foreshore of the Mornington Peninsula all year round and additional ones during the warmer months. However, they say, and on the evidence I am satisfied, that (i) there was not a litter bin for every beach box; and (ii) in any event, the litter bins were not meant to be used for household waste. On the other hand, beach boxes were not meant to accommodate households, as such. They were not meant to be occupied overnight. As a rule, they did not have mains power or running water. And persons using a beach box would have been free to place at least some of their casual litter in any of the litter bins to which they might have had access.
I am satisfied that each of the four things relied on by the Council in this regard (the vouchers, beach cleaning, foreshore litter bins and drain clearing) was of some direct or indirect benefit to the occupiers of beach boxes as a class. On the other hand, of course, none of them amounted to a service involving the direct collection by the Council of refuse from the land charged. If the making available of a service of that particular kind for each property to be charged had truly been required by the Act as a condition of validity for an annual service charge under s 162(1)(b), none of the four services relied on by the Council would have satisfied it. However, as indicated above, in my view, for the reasons to be given in more detail below, the Act did not impose such a condition. Hence I consider that the Council has no need to rely on any of the four services in question.
For completeness, I note that, at an earlier stage of this case,[35] the plaintiffs seemed to accept that there was no requirement (as a condition of validity) for the Council to provide a direct refuse collection service for each property charged, but seemed to be contending instead, merely, that there was a requirement that some kind of waste-related service be provided by the Council to or for the benefit of the owner or occupier of each property to be charged. The defendant Council, for its part, apparently believed that that was the plaintiffs’ position at that stage.[36] This may explain the emphasis placed by the Council on the four services. Ultimately, however, as I understood them, the plaintiffs came to argue for the stricter implied requirement,[37] perhaps recognising that one or more of the four things relied on by the Council would have satisfied the more liberal requirement. In passing, I mention again, in case it matters, that I am satisfied that beach box occupiers as a class did derive some direct or indirect benefit (and, in the cases of beach cleaning, foreshore litter bins and drain clearing, some special benefit), from each of the four services relied on by the Council.
[35]Namely, upon the filing of the plaintiffs’ main pre-trial written submissions: see paragraphs 46, 47 and 81 of these reasons.
[36]See paragraphs 86–89 and 95 below.
[37]See paragraphs 93, 96 and 98 of these reasons.
Variations in the plaintiffs’ case
As mentioned above and as will be seen in more detail in a moment, the plaintiffs’ case has varied significantly over time, this tending in itself to cast grave doubt on the strength of the plaintiffs’ case as finally put.
The originating motion in its initial form
By paragraph 1 of the prayer for relief in the originating motion initially filed, the plaintiffs sought a declaration that the Waste Service Charge was ‘invalid’. By paragraph 2 of the prayer for relief they sought, alternatively, a ‘declaration’ [sic] that the Waste Service Charge be ‘amended’ [sic] to exclude the occupiers of the beach boxes within the municipal district. By paragraph 3, they sought a permanent injunction to prevent the Council from levying a Waste Service Charge on the beach box occupiers. By paragraph 4, they sought, alternatively, an order that the amount of the Waste Service Charge payable by those occupiers be reduced to reflect the value of the service provided to them. By paragraph 5, they sought an order that the Council refund the amount of the Waste Service Charge to any beach box occupiers who had paid it for 2018–2019. By paragraph 6 they sought costs. By paragraph 7 they sought any further order as the Court thought fit.
The originating motion in its initial form contained five paragraphs relating to the grounds of judicial review relied upon. The first three of those paragraphs were merely introductory. Paragraph 4 asserted, only, that the declaration of the Waste Service Charge on 12 June 2018 was invalid ‘because the declaration does not specify or is not based upon any criteria, nor does the Council specify any criteria in the charge’. Paragraph 5 read:
5.Council failed to have regard to section 3C(2)(f) of the Local Government Act 1989 (Vic) in making the declaration. The Waste Service Charge is inequitable as the owners of beach boxes have been levied with the Waste Service Charge in circumstances where:
(a)they are not provided by the Defendant with waste collection and disposal services; and
(b)they pay a Foreshore Site Licence Fee to the Defendant in relation to management of the foreshore.
The amended originating motion
As mentioned above, on 23 May 2019 the plaintiffs filed, by leave, an amended originating motion. The prayer for relief was unchanged. However, each of the grounds originally relied on had been deleted. There was no longer any suggestion of a lack of ‘criteria’ in the declaration of the charge;[38] nor any suggestion of a failure to have regard to s 3C(2)(f) of the Act.[39]
[38]Later, at the oral hearing, counsel for the plaintiffs submitted that a failure to specify any criteria at all would run up against (the former) s 3C(2)(g) of the Act. Prior to its repeal by the Local Government Act 2020, section 3C(2) of the Act provided that, in seeking to achieve its primary objective, a Council must have regard to certain specified ‘facilitating objectives’, one of which was specified in s 3C(2)(g), namely ‘to ensure transparency and accountability in Council decision making’. However, counsel for the plaintiffs confirmed that the plaintiffs were not pressing any suggestion that the Council had failed to comply with s 3C(2)(g) of the Act: transcript, 73.
[39]Section 3C(2)(f) specified another ‘facilitating objective’, namely ‘to ensure the equitable imposition of rates and charges’.
Instead, a new set of grounds was pleaded. They were set out in a re-written paragraph 4. Paragraph 5 was deleted. The new paragraph 4 read as follows:
4.The purported declaration by the Defendant dated 12 June 2018 that there be an annual Waste Service Charge for the collection and disposal of municipal refuse for the 2018/19 financial year was invalid because the declaration was ultra vires insofar as:
(a)The Waste Service Charge seeks to recover the cost of certain items which are not ‘services’, or, if they are services, are not services relating to the collection and disposal of refuse and accordingly, the declaration dated 12 June 2018 is beyond the power conferred by s 162(1)(b) of the Local Government Act 1989 (Vic) and is invalid.
PARTICULARS
A.The Defendant has stated that the Waste Service Charge is intended to recover the cost of the following:
a)Collection of waste and refuse – including:
i.Kerbside waste collection
ii.Kerbside recyclables collection
iii.Kerbside hard-waste collection
iv.Street sweeping
v.Footpath sweeping and cleaning
vi.Street litter bin collection
vii.Beach cleaning.
b)Disposal of waste and cleaning – including:
i.Waste disposal contract costs
ii.Green waste process costs EPA audit recommendations implementation at the Rye Landfill
iii.Risk management initiatives at former Shire Landfills
iv.Dry capped landfill capping provisions
v.Waste management leachate treatment
vi.Ground water and surface water monitoring
viiLandfill facility for solid waste.
c) State Government Landfill levy
B.The Defendant has stated that the Waste Service Charge is intended to recoup the Defendant’s costs, inter alia, of:
(i)Waste disposal contract costs;
(ii)Green waste process costs EPA audit recommendations implementation at the Rye Landfill;
(iii)Risk management initiatives at former Shire Landfills;
(iv)Rye Landfill capping provision;
(v)Landfill facility for solid waste;
(vi)State Government Landfill levy; and
(vii)Provision for future works landfill operations (rehabilitation works);
none of which is a service for the collection and disposal of refuse within the scope of s 162(1)(b) of the Local Government Act 1989 (Vic), nor a prescribed service within the meaning of s 162(1)(d).
C.The Defendant stated that the Waste Service Charge was intended to recoup the Defendant’s costs of the items in A and B(i) to (vi) [sic] above in:
(i)2016-2017 Adopted Budget;
(ii)2017-2018 Adopted Budget;
(iii)2018-2019 Adopted Budget;
(iv)Council meeting minutes dated 20 June 2016;
(v)Council meeting minutes dated 13 June 2017;
(vi)Council meeting minutes dated 12 June 2018;
(vii)Council Brochure entitled ‘Rates, Valuations & Budget 2018/19;
(viii)Council’s website page ‘How are my rates calculated?’
(b)On the proper construction of s 162(1)(b) of the Local Government Act 1989 (Vic), a service charge for the ‘collection’ of refuse is confined to a charge for the collection of refuse from rateable properties and the disposal of refuse is confined to the ‘disposal’ of refuse collected from, or from outside rateable properties and the Waste Service Charge seeks to recover other items.
(c)The items listed by the Defendant as those for which the Waste Service Charge seeks to recover the costs do not constitute an integrated overall service for the collection and disposal of refuse;
(d)The power to declare a service charge within the meaning of s 162(1)(b) of the Local Government Act 1989 (Vic):
i.is limited to declaration of charges for a service provided, or made available to, the land which is the subject of the said charges; and
ii.does not permit the imposition of a tax and in consequence, must be exacted for particular identified services provided or rendered individually to, or at the request or direction of, the particular person required to make the payment;
(e)the Waste Service Charge was levied on beach box and boat shed owners in circumstances where:
i.they were not, and are not, provided by the Defendant with a service for the collection and disposal of refuse; and
ii.they pay a Foreshore Site Licence Fee to the Defendant in relation to the management of the foreshore; and
iii.the Waste Service Charge was not a charge for a service but rather was a tax; and
iv.the land the subject of the Waste Service Charge, where the beach boxes and boat sheds were located, was not provided with services for the collection and disposal of refuse and such services were not available to the said land; and
v.The items in respect of which the Waste Service Charge was levied were not provided to them but were provided to the community and in consequence their cost should be recovered by the general rate or other permissible means and not by imposition of a service charge.
The plaintiffs’ pre-trial written submissions: new grounds 4(a), (b) and (c) dropped
Within two weeks of the filing of the amended originating motion, the plaintiffs filed their main pre-trial written submissions, which were dated 3 June 2019. In those submissions,[40] the plaintiffs said that they did not press sub-paragraphs 4(a) to (c) of the grounds. The non-pressing of sub-paragraphs 4(a), (b) and (c) appeared to amount to an indication by the plaintiffs that they were abandoning the following propositions:
·that there were certain items covered by the Waste Service Charge (particularly as listed in paragraph B of the particulars under sub-paragraph 4(a) of the grounds) that did not amount to a ‘service’, or to a service ‘for the collection and disposal of refuse’, within the scope of s 162(1)(b) of the Act (see sub-paragraph 4(a) of the grounds);
·that, for the purposes of s 162(1)(b) of the Act, the meaning of ‘collection’ of refuse was confined to collection of refuse from, or from outside, rateable properties, and the meaning of ‘disposal’ of refuse was confined to disposal of refuse collected from, or from outside, rateable properties (see sub-paragraph 4(b) of the grounds);
·that the items listed by the defendant as those for which the Waste Service Charge sought to recover the costs did not constitute an integrated overall service for the collection and disposal of refuse (see sub-paragraph 4(c) of the grounds).
[40]At [5] (CB 9).
Sub-paragraphs 4(d) and (e) of the grounds were said to be still pressed. Those sub-paragraphs were less specific about what would allegedly be required to amount to ‘collection’ and ‘disposal’ of refuse for the purpose of s 162(1)(b). As indicated in more detail below, there appeared to be some tension between the abandonment of everything in sub-paragraphs 4(a), (b) and (c) and the pressing of the allegations in sub-paragraphs 4(d) and (e). There was no explanation in the submissions for the taking of this course. It was not said, for example, that it was done to avoid duplication of allegations or contentions. However, in favour of the plaintiffs, I am prepared to assume that a desire to avoid duplication explains some of the apparent tension.
The plaintiffs’ pre-trial written submissions: central contention
In their written submissions of 3 June 2019, the plaintiffs advanced the following submission as their ‘central contention’:[41]
The plaintiffs submit that s 162 of the [Act] requires there to be a connection between a ‘service charge’ declared by a Council and the provision of a service to particular rateable land. A valid exercise of the power in s 162 to declare a service charge is conditioned on the existence of that connection, absent which the resulting exercise of power to declare a service charge will be invalid.[42]
[41]See at [20], [23] (CB 13, 14).
[42]Citing Hossain v Minister for Immigration and Border Protection (2018) 264 CLR 123, 133 [24].
The precise nature of the ‘connection’ said to be necessary was not specified, at least in this part of the written submission.
The plaintiffs’ pre-trial written submissions: statutory interpretation generally
The plaintiffs went on to say that the success of their central contention depended on the proper construction of s 162 of the Act.[43] They said, uncontroversially, that the applicable general principles of statutory interpretation are well known and focus on the statutory text, understood in light of its context and purpose.[44] I interpolate that context is regarded as including any relevant legislative history.[45] The plaintiffs proceeded to advance written submissions on the statutory text, the statutory context, the statutory purpose and the legislative history, respectively, as follows.
[43]The plaintiffs’ written submissions dated 3 June 2019, [21] (CB 14).
[44]Ibid, citing, generally, SZTAL v Minister for Immigration and Border Protection (2017) 262 CLR 362 at [14]; SAS Trustee Corporation v Miles (2018) 265 CLR 137 at [20], [41], [64].
[45]See K & S Lake City Freighters Pty Ltd v Gordon & Gotch Ltd (1985) 157 CLR 309, 315 (Mason J); CIC Insurance Ltd v Bankstown Football Club (1997) 187 CLR 384, 408 (Brennan CJ, Dawson, Toohey and Gummow JJ); Quick Fund (Aust) Pty Ltd v Airmark Consolidators Pty Ltd (2014) 222 FCR 13, 30 [75]; SZTAL v Minister for Immigration and Border Protection (2017) 262 CLR 362, 368 [14] (Kiefel CJ, Nettle and Gordon JJ); Mondelez Australia Pty Ltd v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union [2020] HCA 29; (2020) 381 ALR 601 [13] (Kiefel CJ, Nettle and Gordon JJ).
The plaintiffs’ pre-trial written submissions: the statutory text
As to the statutory text, the plaintiffs attached importance in their written submissions to three aspects.
First, the plaintiffs said, the ordinary meaning of the word ‘charge’ supports their central contention.[46] Citing a dictionary definition, the plaintiffs said that the ordinary meaning of ‘charge’ is ‘[t]he price required or demanded for services [sic] rendered, or (less usually) for goods supplied’.[47] The dictionary definition, they submitted, is consistent with the ordinary legal meaning of the word. Reference was made to the judgment of Ormiston and Phillips JJA (Callaway JA agreeing) in 112 Acland Street Pty Ltd v Australia and New Zealand Banking Group Ltd,[48] a landlord and tenant case on the interpretation of a covenant by the tenant to pay ‘all municipal and other rates and charges etc’. The plaintiffs placed particular reliance on an observation by their Honours that ‘the word [charges] is ordinarily taken to cover those charges which consist in an impost for the supply of some benefit to or for the subject premises’.[49] The plaintiffs said that, while the meaning of the word ‘charge’ will depend on the context in which it is used,[50] the ordinary meaning of the word remains important.[51]
[46]At [23], CB 14.
[47]The plaintiffs cite, without specifying any particular edition, ‘Oxford English Dictionary definition of “charge” in a pecuniary setting, meaning 10b’. But see [106] and following of these reasons.
[48](2002) 4 VR 372 at [21]. The plaintiffs referred also to [28].
[49]Plaintiffs’ emphasis. The plaintiffs here accepted that it was also said in 112 Acland Street at [26] that in some instances it might be possible for the word ‘charges’ to ‘comprehend also involuntarily incurred obligations such as the cost incurred for the right to use water, sewerage and similar facilities supplied to the community generally or in particular areas.’
[50]Here the plaintiffs refer to 112 Acland Street Pty Ltd v ANZ Banking Group Ltd (2002) 4 VR 372 at [22] and also to Independent Commission Against Corruption v Cunneen (2015) 256 CLR 1 at [57].
[51]Citing SZTAL v Minister for Immigration and Border Protection (2017) 262 CLR 362 at [14], [26], [28], [40], [68].
Second, the plaintiffs pointed out that the rates and charges that may be declared under s 162 are designated as ‘service’ rates and charges.[52] The plaintiffs submitted that the compound nature of each of the expressions ‘service charge’ and ‘service rate’ reinforces that there must be some connection between a service and a charge and between a service and a rate. Otherwise, the plaintiffs said, the use of the word ‘service’ would be otiose; and so too would be the specific identification of particular services in paragraphs (a) to (c) of s 162(1) (subject to the prescription of other services under paragraph (d)). Those particular identified services, the plaintiffs said, are, by their nature, services that are able to be provided, and are provided, to specific rateable lands.[53] According to the submissions, this is consistent with the terms of paragraph (a) of s 162(1). The provision of ‘awater supply’ (singular) is, the plaintiffs submitted, ‘plainly’ a service that is to be provided by the Council in relation to particular rateable land.[54]
[52]Plaintiffs’ written submissions dated 3 June 2019 at [24] (CB 14).
[53]Here the plaintiffs refer to Local Government Victoria Better Practice Guide: Revenue and Rating Strategy (2014) at 2[2.2], noting that it was there said that some services provided by Councils are more closely defined as ‘private goods’ and that waste collection is an example of such a service; and noting that, according to the Guide, Councils should recognise that such services are more appropriately covered by ‘user-pays charges’.
[54]Here the plaintiffs note that Victorian ‘Councils no longer have responsibility for water supply and sewerage services’: Department of Environment, Land, Water and Planning, Act for the Future-Directions for a new Local Government Act (2016) at 100(9.6).
Third, the plaintiffs drew attention to the use of the word ‘for’ in the chapeau of s 162(1).[55] In this context, the plaintiffs submitted, ‘for’ means ‘in return for’ the provision of services. Again, the plaintiffs submitted, this reinforced the point already made that there must be some connection between a charge and a service.
[55]Plaintiffs’ written submissions dated 3 June 2019, [25] (CB 15).
The plaintiffs submitted that, for those reasons, the statutory text indicated that a service charge could only be imposed in respect of services rendered to the rateable property levied with that service charge.[56]
[56]Ibid, [26] (CB 15). However, as indicated in [28] and fn 25 above, at the hearing the plaintiffs’ counsel accepted that non-use of the service by a particular ratepayer on a particular day or during a particular period would not invalidate the charge as against that ratepayer, although counsel later suggested that a householder might be able to avoid the charge altogether by rejecting a direct rubbish removal service at the outset.
Plaintiffs’ written pre-trial submissions: the statutory context
As to the statutory context, the critical point, according to the plaintiffs’ pre-trial submissions, is that Part 8 of the Act (which includes ss 155 and 162) recognises an important distinction between ‘rates’ and ‘charges’. That the Act draws that distinction supports the plaintiffs’ central contention, they said. The following features of the Act were said to be important.[57]
[57]Ibid, [27] (CB 15).
In the first place, the plaintiffs submitted, the structure of Part 8 of the Act as a whole (and the text of s 155 specifically) recognises a distinction between ‘rates’ and ‘charges’, as follows:
(a) s 158 confers a power to declare general rates, but not general charges;
(b) s 159 confers a power to declare municipal charges, but not municipal rates;
(c) s 162 refers to both a ‘service rate’ and a ‘service charge’;
(d) s 163 refers to both a ‘special rate’ and a ‘special charge’.
According to the submissions,[58] the power to declare a municipal charge under s 159 is instructive as to the meaning of the word ‘charge’. Under that section, the plaintiffs noted, a Council may declare a municipal charge under s 159 ‘to cover some of the administrative costs of the Council.’ The plaintiffs further noted that a Council’s total revenue from a municipal charge in a financial year must not exceed 20 per cent of the sum total of the Council’s total revenue from a municipal charge and total revenue from general rates in that financial year.[59] This use of the word ‘charge’ to refer to the recoupment of specific expenditure is, according to this part of the plaintiffs’ pre-trial submissions, consistent with the submissions already made about a ‘charge’ being referable to specific goods or to specific services rendered.
[58]Ibid, [29] (CB 16).
[59]The Act, s 160(a).
By way of contrast, according to the submissions,[60] the power to declare general rates under s 158 sheds light on the meaning in the Act of the word ‘rate’ as distinct from the word ‘charge’. The power to declare general rates under s 158, the plaintiffs submitted, must be understood against the background of s 157, which provides that a Council may use one of three different systems of valuation — site value, net annual value or capital improved value. Pursuant to s 160, general rates may be raised by the application of a uniform rate. If a Council adopts that mechanism, the Council must specify a percentage as the uniform rate.[61] The general rate for particular rateable land is then determined by multiplying the value of the land (as determined by the particular valuation system used by the Council) by that percentage.[62] Alternatively, general rates may be raised by the application of a differential rate, pursuant to either s 161 (only if the Council uses the capital improved value system of valuing land) or s 161A (only if the Council does not use that system).
[60]Plaintiffs’ written submissions dated 3 June 2019, [30] (CB 16).
[61]The Act, s 160(a).
[62]The Act, s 160(b).
According to the pre-trial submissions,[63] it is expressed in s 160, and implied in ss 161 and 161A, that the amount of the rate is tied directly to the value of the land[64] as determined under the valuation system used by the Council. In other words, the defining characteristic of a ‘general rate’ is that it is calculated by reference to the value of land. The same defining characteristic, the plaintiffs submitted, should be imported into the meanings of ‘service rate’ and ‘special rate’ by reason of the word ‘rate’ that is common to each of the three species of impost: general rates, service rates and special rates.
[63]Plaintiffs’ written submissions dated 3 June 2019, [31] (CB 16).
[64]Plaintiffs’ emphasis.
What that analysis shows, the plaintiffs submitted, is that the difference between a ‘rate’ and a ‘charge’ under the Act is the mechanism by which the amount of the impost is to be calculated. A rate — whether general, service or special — is to be calculated by reference to the value of the rateable land. In contrast, a charge — whether municipal, service or special — must be calculated by reference to an expense of the Council.[65]
[65]Plaintiff’s written submissions dated 3 June 2019, [32] (CB 17).
According to the written submissions, s 162(2) must be understood in that context. It provides that a service rate or a service charge ‘may be declared on the basis of any criteria specified by the Council’. This provision, the plaintiffs submitted, allows a Council substantial flexibility as to how to set a service rate or service charge, but it does not allow a Council to ignore the difference between service rates and service charges.[66]
[66]Ibid, [33] (CB 17).
Section 221(1) of the Act is also informative, the plaintiffs submitted. The plaintiffs pointed out that while the Council has the power to declare the rates and charges identified in s 155 on ‘rateable land’, it also has a separate and specific power to impose an annual service charge, on land that is not rateable land, under s 221(1), which provides:
221(1) Service charges on non-rateable land
A Council may impose in relation to any land in its municipal district which is not rateable land an annual service charge for any of the following services which the Council provides or which the Council is prepared and able to provide—
(a) the provision of a water supply;
(b) the collection and disposal of refuse;
(c) the provision of sewage services;
(d) any other prescribed service.[67]
[67]I note that s 221(2) provides: ‘The service charge under this section may be imposed on the basis of any criteria specified by the Council.’
This provision, the plaintiffs noted, does not confer a power to levy service rates; it only confers a power to levy service charges. According to the submissions, because s 221 applies to non-rateable land, it would not make sense to permit service rates to be levied upon that land. The omission to include service rates in s 221 thus underscores that service rates are to be imposed by reference to the value of the land (see s 157) whereas service charges are to be calculated by reference to the cost of the services.
According to the plaintiffs’ written submissions, the deliberate omission of ‘service rate’ from s 221 is ameliorated somewhat in the context of non-rateable land by the extension in s 221 to permit the Council to recoup funds, by way of service charge, for not only services ‘which the Council provides’ but also for those ‘which the Council is prepared and able to provide.’ That extension, the plaintiffs submitted, covers some of the territory of a service rate without exposing non-rateable land to the full gamut of service rates that might otherwise be imposed in the municipal area. According to this submission, the express extension serves only to emphasise, by its omission from s 162 of the Act, the more limited notion of a service charge in s 162.[68]
[68]But, again, compare this with the plaintiffs’ counsel’s oral submissions referred to at [28] and fn 25 above and at [53] and fn 56 above.
Plaintiffs’ pre-trial written submissions: the statutory purpose
Turning to the matter of statutory purpose, the plaintiffs submitted that the statutory context already discussed has important implications for discerning the purpose of s 162, in particular. That purpose, it was submitted, is to empower the Council to recover expenses associated with providing particular services.[69]
[69]Plaintiffs’ written submissions dated 3 June 2019 [37] (CB 18).
It is by the imposition of general rates under s 158, the plaintiffs submitted, that the Council funds services to the community at large.[70] As was envisaged when the Act was first enacted, ‘general rates remain the principal taxation base for Councils to raise revenue’.[71] Thus, the plaintiffs submitted, the purpose of general rates is to ‘build up’ the revenue of the Council.[72] According to the written submissions, that is explicable because, by definition, a general matter is something to the benefit of the public at large, and therefore not amenable to impost by way of a charge as that term should be understood in the Act.
[70]Citing Second Reading Speech, Local Government Bill (No 2) 1987 (Legislative Assembly, 29 October 1987) at 1905.
[71]Same citation given.
[72]Citing Air Services Australia v Canadian Airlines (1999) 202 CLR 133 at [87] (Gleeson CJ and Kirby J). The intended reference may have been to [89].
In contrast, according to the submissions, municipal charges imposed under s 159 (as discussed already) are directed to recouping administrative costs. Similarly, the plaintiffs submitted, special rates and special charges must be directly connected to the performance of a function or the exercise of a power of the Council. Under s 163, they may be declared ‘only for the purposes of defraying any expenses or repaying (with interest) any advance made to or debt incurred or loan raised by the Council’:
in relation to the performance of a function or the exercise of a power of the Council, if the Council considers that the performance of the function or the exercise of the power is or will be of special benefit to the persons required to pay the special rate or special charge.[73]
[73]The Act, s 163(1).
According to the plaintiffs, s 162 should be characterised as a provision similar in kind to s 163. In contrast to general rates, imposts under ss 162 and 163 are evidently not mechanisms for general revenue raising, but instead require ‘some connection’ with a ‘special benefit or a service’, according to the submissions.[74]
[74]Plaintiffs’ written submissions dated 3 June 2019, [40] (CB 19).
The plaintiffs also submitted that Part 8A of the Act further highlights the distinction between the purposes of general rates and the purposes of other imposts that a Council may impose.[75] Part 8A — which took effect in its current form in the same financial year that the Waste Service Charge was introduced[76] — deals with rate caps and is only concerned with total revenue raised from ‘general rates, municipal charges and any other prescribed rates or charges on rateable properties’.[77] It is not concerned, the plaintiffs submitted, with rates and charges imposed under ss 162 or 163. According to the plaintiffs’ submissions, if s 162 were given a construction that permitted the Council to divorce a service charge from the provision of a service to particular rateable land, it would allow the Council to impose a service charge that is, in substance, a general rate, and thereby circumvent the rate cap regime contained in Part 8A (and, in relation to a municipal charge, the 20 per cent constraint previously mentioned).
[75]Ibid, [41] (CB 19).
[76]The plaintiffs here draw attention to the Local Government Amendment (Fair Go) Rates Act 2015 (Vic), which commenced on 2 December 2015.
[77]The Act ss 185B–185C.
As their final point in relation to statutory purpose, the plaintiffs submitted that the distinction in the Act between the two types of imposts (general rates on the one hand and other imposts on the other) recalls the distinction between taxes and fees for services in the Commonwealth Constitutional context.[78] Authorities explaining that distinction provide a useful framework for understanding the distinction drawn in the Act, the plaintiffs submitted. In particular, they submitted, it is well accepted that ‘[f]or an exaction to constitute a fee for service, some service must actually be provided to the person liable to pay’.[79] That is, the plaintiffs contended, there must be ‘particular identified services provided or rendered individually to, or at the request or direction of, the particular person required to make the payment.’[80] That is especially so, the plaintiffs submitted, when a ‘charge’ is adopted as the vehicle for levying the impost.[81]
[78]Plaintiffs’ written submissions dated 3 June 2019, [42] (CB 19), citing Air Caledonie International v Commonwealth (1988) 165 CLR 462 at 467 (the Court); Air Services Australia v Canadian Airlines (1999) 202 CLR 133 at [87] (Gleeson CJ and Kirby J), [132]–[133] (Gaudron J), [287]–[298], [302]–[305] (McHugh J), [436]–[441] (Gummow J).
[79]Ibid, loc. cit., citing Air Services Australia v Canadian Airlines (1999) 202 CLR 133 189 at [133] (Gaudron J) (emphasis added by plaintiffs).
[80]Ibid, loc. cit. citing Air Caledonie International v Commonwealth (1988) 165 CLR 462 at [469]–[470].
[81]Ibid, loc. cit.
Plaintiffs’ pre-trial written submissions: legislative history
The plaintiffs further contended, in their pre-trial written submissions, that the construction advanced by them is consistent with the legislative history.[82]
[82]Ibid, [43]–[45] (CB 20–21).
In particular, they submitted, prior to the enactment of the Act, rates and charges relating to the collection and disposal of refuse were dealt with by the Health Act1958 (Vic). Under s 60(1), they said, a Council was empowered to make and levy a ‘sanitary rate’ in respect of all or any rateable properties. However, instead of making and levying such a rate, a Council was empowered by s 61(1) to ‘make an annual charge for the proper collection removal and disposal of refuse and rubbish … and may make and levy any such charge for the collection removal and disposal of refuse and rubbish notwithstanding that the occupier of any premises does not avail himself of the service provided.’[83] Under s 61(2), the plaintiffs submitted, any such charge was to be levied ‘on the owners or occupiers [sic] of the several tenements in respect of which the services for which the charge is made are rendered or are available.’[84]
[83]Emphasis added by the plaintiffs.
[84]Emphasis added by the plaintiffs. In fact, s 61(2) referred to the ‘occupiers or owners’, not the ‘owners or occupiers’.
The plaintiffs submitted that it was apparent from the emphasised text of those provisions that both ss 60 and 61 of the Health Act 1958 (Vic) proceeded on the basis that the charge under s 61 related to a service that was provided by the Council to particular premises. Those sections also observed the general distinction between rates and charges, the plaintiffs submitted.
It was further submitted that earlier versions of ss 60 and 61 appeared in ss 53 and 54 of the Health Act 1919 (Vic), and that, again, these antecedents distinguished between rates (s 53) and charges (s 54). It was said that these provisions have an even longer history.[85] There is no reason to suppose, the plaintiffs submitted, that the legislature intended to rewrite the long-standing legislative policy manifested in ss 60 and 61 of the Health Act 1958 (Vic). That is so, they submitted, even though a purpose of the Act was to ‘reform the law relating to local government in Victoria’.[86] In that context, the plaintiffs submitted, the enactment of s 162 can be seen as a transfer of the Health Act 1958 (Vic) provisions to the Act,[87] as part of a broader consolidation and rationalisation of the provisions relating to various rates and charges imposed by local governments.[88]
Plaintiffs’ pre-trial written submissions: alleged invalidity of declaration of Waste Service Charge
[85]Reference was made to the Health Act 1911 (WA), ss 41 and 93.
[86]At this point the plaintiffs referred to the long title for the Bill that became the Act (stated in Endnotes to the Act).
[87]It was noted here in a footnote that ss 60 and 61 of the Health Act 1958 were repealed by the Local Government (Consequential Provisions) Act 1989 (Vic), Sch 2 items 57.25 and 57.26.
[88]Here the plaintiffs referred in a footnote to the previous regime for general, extra and separate ‘charges’ [sic, scil ‘rates’] under Pt X of the Local Government Act 1958 (Vic) (as originally enacted), an Act which itself was a consolidation of the law relating to local government.
In their written submissions, the plaintiffs next turned to the application of their proposed construction of the Act.[89] They submitted that once their construction of s 162(1)(b) of the Act was accepted, it became necessary to consider whether the Council’s declaration fell within the scope of the service charge aspect of that provision. They contended that for a service charge declared by the Council under s 162(1)(b) to be valid it must be declared in terms that levy the charge ‘by reference to’ the provision of ‘collection and disposal of refuse’ to particular rateable land. They submitted that the declaration of the Waste Service Charge did not comply with that condition and was therefore invalid.[90]
[89]Plaintiffs’ written submissions dated 3 June 2019 [46]–[55] (CB 21–24).
[90]Ibid, [46] (CB 21).
The plaintiffs submitted that the Council had imposed a ‘service’ charge that applied indiscriminately to ‘each rateable property’ without any reference to whether each rateable property received the service described in s 162(1)(b). The ‘terms’ of the Waste Service Charge declaration revealed no necessary connection between the purported service charge and the service provided to a rateable property. The charge was stated to be imposed on ‘each rateable property’ with only two very limited exceptions. Its terms did not limit the charge to those properties that were provided with the particular service.[91]
[91]Ibid, [47] (CB 21).
Next, the plaintiffs submitted that the alleged error of the Council in making the Waste Service Charge declaration was brought into sharp focus by comparing it with the ‘opt-in green waste service charge’ that had been declared at the same time.[92] The plaintiffs submitted that the declaration of the green waste service charge, in contrast to the declaration of the Waste Service Charge, plainly identified a connection between the charge and the service provided.
[92]See [25] above.
The plaintiffs’ written submissions then returned to the distinction between a tax and a fee for service in the Commonwealth Constitutional context. They referred to Air Caledonie International v Commonwealth.[93] In that case the High Court held that a statutory fee for immigration clearance, at least in so far as the fee purported to apply to a returning Australian citizen, was not a fee for service but a tax, because the administrative procedures for re-entry into Australia that were imposed on a citizen (being a person who had a right to re-enter Australia without any clearance) could not ‘properly be seen as the provision or rendering of “services” to, or at the request or direction of, the citizen concerned’. That conclusion disposed of the case, but the High Court went on to express the view that the legislation did not identify any ‘particular services provided or rendered to the individual passenger for which the impost could relevantly be regarded as a fee or quid pro quo’.[94] In arriving at that view, the High Court referred to the relevant Second Reading Speech, which confirmed:
that the monies intended to be raised by the purported impost were not related to particular services to be supplied to particular passengers but were intended to provide, when paid into consolidated revenue, a general off-setting of the administrative costs of certain areas of the relevant Commonwealth Department, including, for example, the administrative costs involved in maintaining facilities for the issue of visas in overseas countries and ‘general administrative overheads’.[95]
[93](1988) 165 CLR 462 at 470.
[94](1988) 165 CLR 462 at 470 (the Court), as explained in Air Services Australia v Canadian Airlines (1999) 202 CLR 133 at 280 [438] (Gummow J).
[95]Air Caledonie (1988) 165 CLR 462 at 470 (‘the Court’).
Similarly here, the plaintiffs submitted, the Council has recognised that the Waste Service Charge is not connected only to particular services provided to particular rateable property, but rather is to cover general costs relating to waste management. In relation to many of the services identified by Council, the holders of licences and permits for beach boxes derived ‘no more benefit’ from them than the ‘community in general’.[96]
[96]Plaintiffs’ written submissions dated 3 June 2019, citing Northern Suburbs General Cemetery Reserve Trust v Commonwealth (1993) 176 CLR 555 at 588 (Dawson J) and referring also to 564–566 (Mason CJ, Deane, Toohey and Gaudron JJ).
According to the written submissions, the difficulty for the Council is that it has treated service charges as if they were a species of impost that might be referred to as a general charge. The plaintiffs here[97] referred to a letter dated 11 October 2016 addressed to the President of the first plaintiff from the financial controller of the Council in which it was said:[98]
The Council provides a multitude of Council services plus maintain and upgrade local roads and other community infrastructure which are available to all community [sic] but may not be used by different segments of the Shire’s population. For example, kindergartens are not used by pensioners, boat ramp maintenance is irrelevant if you don’t own a watercraft etc. Nevertheless, these services are funded by the general charge on rate payers.
[97]Ibid, [52] (CB 23).
[98]CB 368–369.
According to the plaintiffs, the last two sentences of that quoted paragraph again highlighted the alleged error of the Council in relying on s 162(1)(b) to declare the Waste Service Charge. Those two sentences, the plaintiffs submitted, equate the provision of general waste management services with the provision of other services such as kindergartens. But, the plaintiffs submitted, plainly enough, kindergartens cannot be funded by a service charge imposed under s 162(1)(b). Nor can general waste management services that do not have a relationship with any particular rateable land, they submitted.
However, in my view, this says nothing about whether an annual service charge can only be declared for services to individual properties. It does not avail the plaintiffs to say, as they do, that a rate must be ‘calculated’ by reference to the value of the rateable land, whereas a charge – whether municipal, service or special – must be ‘calculated’ by reference to an expense of the Council or by reference to the cost of the services.[217] The plaintiffs are not comparing like with like and, as a result, the point is misconceived. It is true that, in the case of any ‘rate’ (including a service rate), the amount required to be paid by the individual ratepayer will be calculated, and set out on their individual rate notice, according to the value of their rateable land. However, for present purposes that is not the relevant calculation in relation to service rates. If my analysis above is correct,[218] the relevant calculation will involve seeking to ensure that the total amount to be paid by way of service rates of a particular kind for the financial year does not exceed the total amount that a Council can raise by way of that kind of service rate for that financial year. This maximum, in turn, will be fixed by reference to the total amount of the anticipated costs and expenses of the Council for providing the relevant service or services during the upcoming financial year. And the same is true for a service charge, or for a combined service rate and service charge. How the Council chooses to distribute the burden as between ad valorem imposts (ie rates) and other kinds of imposts is not relevant in this particular regard.
[217]See [59], [62] and [152] above.
[218]See [153] and [154] above.
However those things may be, the very fact that s 162(1) authorises the imposition of service rates for ‘the collection and disposal of refuse’, that is to say, that s 162(1) authorises a Council to declare a rate – an impost that, for the individual required to pay it, varies with land value – ‘for’ the same thing as that ‘for’ which an annual service charge may be declared, tends to point away from any Parliamentary intention to tie the declaring of an annual service charge to the specific cost of providing a relevant service to each particular parcel of rateable land to be charged.
Moreover, if one of the plaintiffs’ own ultimate submissions[219] is correct, namely that it is permissible to declare a service rate under s 162(1)(b) for municipal waste services in the general sense, then it is surely permissible to declare an annual service charge under that self-same provision for that self-same thing.
[219]See [99] and fn 132 above.
Further, as mentioned above,[220] the Act bundles together ‘rates’ and all presently relevant ‘charges’ (including service charges) in Part 8, being the Part of the Act in which they are authorised to be declared and by which they are regulated; and no other form of impost or type of revenue-raising is dealt with in that Part. In addition, all of the rates and charges under Part 8 share a common basic feature – they are to be, and can only be, declared ‘on rateable land’: s 155. Primary liability falls on the owner of the rateable land, not the occupier: s 156(1). If the owner cannot be found or identified – but only in those circumstances – the occupier or the mortgagee in possession (if any) is liable to pay the rates and charges: s 156(2). Otherwise, so far as the express provisions of the Act relating to rates and charges under Part 8 are concerned, neither liability nor quantum turns on periods of occupation or on periods of enjoyment or of use of any services or benefits, or on any requests for services or benefits, or on any purported rejections of the same. This is so even – and most pertinently – in the case of service charges. Consistently with this, s 173 of the Act provides that if land becomes, or ceases to be, rateable land after 1 July in a financial year, the rate or charge which is payable on that land for the financial year is the amount which is proportionate to the part of the financial year during which the land was rateable land. There is no equivalent or corresponding provision in relation to broken periods of occupancy, or in relation to broken periods of availability of any particular individual service, during a financial year.
[220]At [120].
In their submissions on statutory context, the plaintiffs try to gain traction from the provisions in the Act referring to municipal charges.[221] But, in my view, those provisions also tend strongly against the plaintiffs’ case. I have already given some reasons for that view.[222] I would add the following. Section 159(1) of the Act authorises a Council to impose a municipal ‘charge’ to cover ‘some’ of the Council’s ‘administrative’ costs, subject to the limit specified in s 159(2) that a Council’s total revenue from a municipal charge in a financial year must not exceed 20 per cent of the sum total of the Council’s total revenue from a municipal charge and total revenue from general rates in that financial year. It is true that the costs that may be ‘covered’ by a municipal charge declared under s 159(1) are limited to (some of) the anticipated ‘administrative’ costs of the Council. So, a municipal charge should relate to anticipated costs of a particular kind. However, the administrative costs of a Council are, by definition, its costs of internal activities, not its costs of external activities. Administrative costs are not to be equated to or analogised with the costs of providing particular services to individuals. If anything, they are closer in nature to the costs of providing services to the community as a whole. Thus, Parliament has seen fit in this very Act to use the word ‘charge’ to describe an impost designed to cover some of a Council’s general internal administrative costs. That makes it very difficult to accept that the same Parliament should be taken to have treated the word ‘charge’ as being applicable only to those types of liabilities that are imposed to cover the costs of specific services provided to individuals or provided to land owned or occupied by the individuals to be charged.
[221]See [56] above.
[222]See [121] above.
The plaintiffs submit that s 221(1) of the Act, which is set out above and which relates to service charges on non-rateable land, is informative as to the difference between rates and charges. They submit that the omission to include service rates in s 221 underscores the point that service rates are to be imposed by reference to the value of the land, whereas services charges are to be calculated by reference to the cost of the services. But that point itself is misconceived and does not assist the plaintiffs, as I have already sought to show.[223]
[223]See [158].
The plaintiffs further submit that s 221 permits a Council to recoup funds, by way of service charge, not only for services ‘which the Council provides’, but also for those ‘which the Council is prepared and able to provide’. According to the plaintiffs, that ‘extension’ covers some of the territory of a service rate without exposing non-rateable land to the ‘full gamut’ of service rates that might otherwise be imposed. The plaintiffs say that this express extension serves only to emphasise, by its omission from s 162 of the Act, the more limited notion of a service charge in s 162. However, there are at least two major difficulties for the plaintiffs in relation to these additional submissions. First, as noted above,[224] the plaintiffs’ counsel accepted during the oral hearing that, on the plaintiffs’ own case, what mattered in relation to the validity of an annual service charge was whether services were provided to the property, irrespective of whether or not the owner or occupier happened to use the services on a particular day or during a particular month or the like. Second, as I have already indicated, the language and structure of s 162(1) indicate that the ‘territory’ of a service rate is exactly the same as the ‘territory’ of a service charge.
[224]See [28].
The plaintiffs have not suggested, either in writing or orally, that anything else in s 221 assists their case.
Turning from the ‘charge’ element of s 162 to the ‘service’ element for a moment, it is useful to survey the statutory context more broadly for indications about the type or nature of the ‘services’ that s 162(1), including s 162(1)(b), may be referring to, especially as to the distinction between services to individuals and services to the local community. The following references are to provisions of the Act that were in force at the time of the declaration in question (June 2018). At this stage I will refer to them in the present tense as though they were all still in force, notwithstanding that some of them have since been amended or repealed by the Local Government Act 2020, as mentioned above.[225] In my view, the provisions to which I am about to refer, especially the several provisions referring to the providing by a Council of services for its local community and the provisions highlighting the breadth of the powers of a Council (including as to revenue raising), afford considerable support for the Council’s position. Similar reasoning on comparable NSW legislation, leading to a similar conclusion, can be found in the judgment of the Land and Environment Court of New South Wales (Pain J) in Regional Express Holdings Ltd v Dubbo City Council (No 3).[226] The relevant reasoning of Pain J was referred to with apparent approval – indeed it was applied to other comparable NSW legislation – by the Court of Appeal of New South Wales in Nash Bros Builders Pty Ltd v Riverina Water County Council.[227] Likewise, similar reasoning on comparable Victorian legislation, leading to a similar conclusion, can be found in the decision of the Victorian Civil and Administrative Tribunal (Deputy President Dwyer) in Joseph v Melbourne Water and Anor.[228]
[225]See [3] and [4] above.
[226](2014) 212 LGERA 41.
[227](2016) 92 NSWLR 766. See esp at 787 [101]–[104], 789 [114] (per Ward JA, with whom Macfarlan JA agreed).
[228][2010] VCAT 1414, esp at [26]–[34].
The Act has a Preamble. It is set out in the six sub-sections of s 1. Three of those sub-sections refer to the importance of certain statutorily required relationships between a Council and its ‘local community’ (s 1(3), (4) and (5)). A Council is to be ‘responsible’ and ‘accountable’ to its local community (s 1(3) and (5)); and is to provide ‘governance’ and ‘leadership’ to its local community, including through decision-making and action (s 1(4)). Sub-section 1A(1) provides that it is the intention of the Parliament that the provisions of the Act be interpreted so as to give effect to the Preamble and the ‘local government charter’. The local government charter is set out in Part 1A of the Act, to which I will shortly come. Sub-section 1A(2) provides that the Preamble and the local government charter are not to be construed as having the effect of limiting the functions and powers of Councils under the Act or any other Act.
As indicated above,[229] a definition of ‘local community’ is contained in s 1A(4) of the Act. It is worth setting it out again here:
local community includes–
(a)people who live in the municipal district; and
(b)people and bodies who are ratepayers; and
(c)people and bodies who conduct activities in the municipal district.
[229]See [4] and fn 4 above.
As to the local government charter set out in Part 1A of the Act, the following provisions are noteworthy for present purposes (emphasis added):
3C Objectives of a Council
(1)The primary objective of a Council is to endeavour to achieve the best outcomes for the local community having regard to the long term and cumulative effects of decisions.
(2)In seeking to achieve its primary objective, a Council must have regard to the following facilitating objectives–
…
(b)to ensure that resources are used efficiently and effectively and services are provided in accordance with the Best Value Principles to best meet the needs of the local community;
(c)to improve the overall quality of life of people in the local community;
…
(e)to ensure that services and facilities provided by the council are accessible and equitable;
(f)to ensure the equitable imposition of rates and charges …
…
3E What are the functions of a Council?
(1)The functions of a Council include–
(a)advocating and promoting proposals which are in the best interests of the local community;
(b)planning for and providing services and facilities for the local community;
(c)providing and maintaining community infrastructure in the municipal district …
(e)raising revenue to enable the Council to perform its functions.
(2)For the purpose of achieving its objectives, a Council may perform its functions inside and outside its municipal district.
3F What are the powers of Councils?
(1)Subject to any limitations or restrictions imposed by or under this Act or any other Act, a Council has the power to do all things necessary or convenient to be done in connection with the achievement of its objectives and the performance of its functions.
(2)The generality of this section is not limited by the conferring of specific powers by or under this or any other Act.
Part 6 of the Act requires Councils to prepare and approve Council Plans. Under s 125, a Council Plan must include the ‘strategic objectives’ of the Council. The Council Plan must also include a Strategic Resource Plan setting out the resources required to achieve the strategic objectives. Section 126(2A) provides that the Strategic Resource Plan must take into account ‘services and initiatives’ contained in any plan adopted by the Council. Sub-section 126(2B) provides that a Council that proposes to adopt a plan to provide services or take initiatives must ensure that the resources required for the plan are consistent with the Strategic Resource Plan. As already mentioned,[230] a Council must prepare budgets. Under s 127, a Council must do so for each financial year and must ensure that the budget contains, among other things, a description of the services and initiatives to be funded in the budget, and also a statement as to how these services and initiatives will contribute to achieving the strategic objectives identified in the Council Plan.
[230]See [4] above.
Division 3 of Part 9 of the Act deals with what the Act calls the Best Value Principles. Under s 208A, a Council must comply with the Best Value Principles. Section 208B is worth setting out in full. It provides (emphasis added):
208B Best Value Principles
The Best Value Principles are–
(a)all services provided by a Council must meet the quality and cost standards required by section 208B;
(b)subject to sections 3C(2)(b) and 3C(2)(e),[231] all services provided by a Council must be responsive to the needs of its community;
(c)each service provided by a Council must be accessible to those members of the community for whom the service is intended;
(d)a Council must achieve continuous improvement in the provision of services for its community;
(e)a Council must develop a program of regular consultation with its community in relation to the services it provides;
(f)a Council must report regularly to its community on its achievements in relation to the principles set out in paragraphs (a), (b), (c), (d) and (e).
[231]Sections 3C(2)(b) and 3C(2)(e) are set out above.
It is also desirable to set out ss 208C and 208D. They provide (emphasis added):
208C Factors that may be looked at in applying the Principles
In applying the Best Value Principles, a Council may take into account, among other factors–
(a)the need to review services against the best on offer in both the public and private sectors; and
(b)an assessment of value for money in service delivery; and
(c)community expectations and values; and
(d)the balance of affordability and accessibility of services to the community; and
(e)opportunities for local employment growth or retention; and
(f)the value of potential partnerships with other Councils and State and the Commonwealth governments; and
(g)potential environmental advantages for the Council’s municipal district.
208D Quality and cost standards
(1)A Council must develop quality and cost standards for the provision of any service it provides for its community.
(2)A quality or cost standard must set out the performance outcomes determined by the Council in relation to each service.
(3)In developing quality and cost standards a Council must take into account the factors listed in sections 208C(a), (b), (c), (d) and (e).
(4)A Council may develop different quality and cost standards for different classes of services.
In 2020,[232] in CoINVEST Ltd v Citywide Service Solutions Pty Ltd,[233] Niall JA observed, in relation to the (1989) Act as first enacted and as amended to that time, that the powers of Councils under the Act ‘were and remain broadly conferred’.[234]
[232]Shortly prior to the commencement of the Local Government Act 2020 (Vic).
[233](2020) 62 VR 337.
[234]Ibid, 340 [10].
On reading the Act as a whole, and having regard particularly to the provisions just referred to, it may be said that the predominant concept of ‘service’ or ‘services’ in the Act is the concept of services to the local community, rather than particular services to individuals. The Act is also at pains to ensure that Councils will have the power to ensure that they have the resources necessary to provide such ‘services’. The tenor of the Act as a whole thus favours the view that a Council may declare an annual service charge for a ‘service’ or ‘services’ to its local community or for services to individuals or for both, as it sees fit. There is no contextual reason to exclude from this view the services described in s 162(1)(b) as ‘the collection and disposal of refuse’.
Statutory context: summary
In my opinion, the statutory context clearly favours the defendant’s construction of ss 155(d) and 162(1)(b) and tends strongly against the plaintiffs’ case.
Statutory purpose
The plaintiffs’ submissions in relation to statutory purpose are largely repetitive of their submissions in relation to statutory text and statutory context. They submit that the legislative purpose is to empower the Council ‘to recover expenses associated with providing particular services’.[235] So much may be accepted. However, for the reasons already given, the identification of that statutory purpose hinders, rather than helps, the plaintiffs’ case.
[235]See [64] above.
Contrary to the plaintiffs’ submissions, the defendant’s case does not suggest that s 162 can be used for ‘general revenue raising’.[236] The defendant’s case accepts that there must be ‘some connection’ with a relevant service. And the required connection, as identified above, clearly exists here, in that the Waste Service Charge was declared with a view to covering the anticipated costs of ‘the collection and disposal of refuse’ for the benefit of the Council’s local community and its individual members. The plaintiffs have abandoned any suggestion that the Waste Service Charge went beyond this.
[236]See [67] above.
For similar reasons, I do not accept that Part 8A of the Act, which deals with rate-capping, assists the plaintiffs on the facts of this case.[237] On its face, Part 8A only applies to general rates, municipal charges and ‘any other prescribed rates or charges on rateable properties’. There has been no prescription of annual service charges. Hence Part 8A does not apply to the defendant’s Waste Service Charge. For the reasons already given, I do not accept that the Waste Service Charge is ‘in substance’ a general rate. The amount raised by the Waste Service Charge could equally have been raised by a service rate, being a form of impost that is also not subject to Part 8A. So, on no view has the rate cap regime contained in Part 8A been ‘circumvented’.
[237]Compare [68] above.
Finally, on this part of the case, it does not assist the plaintiffs to refer to the distinction between taxes and fees for services in the Commonwealth constitutional context. There is no suggestion that the Waste Service Charge amounted to an excise or that it otherwise offended the Commonwealth Constitution.[238] And, as mentioned above, the plaintiffs have not sought to rely on any special principle of statutory construction relating to the interpretation of taxing or fiscal legislation. It is therefore not necessary for me to consider or decide whether, in some other context, the Waste Service Charge might be found to be a tax as distinct from a fee for service.[239] In passing, I note the plaintiffs’ submission that it is well accepted that ‘[f]or an exaction to constitute a fee for service, some service must actually be provided to the person liable to pay’.[240] However, that condition might well have been met here. I have found, in effect, that the waste disposal vouchers that were supplied by the defendant Council to all ratepayers, including the beach box holders, amounted to a service actually and directly provided to all persons liable to pay the Waste Service Charge, including the second plaintiff and the members of the first plaintiff. I have also found that the other three services relied on by the defendant, namely the beach cleaning, the foreshore litter bins, and the drain cleaning, were of at least indirect benefit to them. And it seems quite possible that the Waste Service Charge would meet the other requirements stated in the authorities for a charge to avoid being described as a tax, ie it seems quite possible that the Waste Service Charge would be found to be within the same category as the aviation services charges at issue in Air Services Australia v Canadian Airlines[241] which were found not to amount to a tax, and which were described by Gleeson CJ and Kirby J as follows:[242]
In this case, the charges were not imposed to raise revenue; the charges were undoubtedly charges for the provision of services and facilities; the charges were imposed to recover the cost of providing such services and facilities across the entire range of users; the charges for categories of services were reasonably related to the expenses incurred in relation to the matters to which the charges related; the services and facilities were, of their nature, part of an activity which must be highly integrated in order to be effective; there was a rational basis for such discrimination between users as existed.
[238]See JD Hammond, A Growth Tax for the States? – Rubbish!, (1977) 4 Monash University Law Review 155 at 155-158.
[239]A similar view in relation to a comparable statutory situation was taken by the Victorian Civil and Administrative Tribunal in Joseph v Melbourne Water & Anor [2010] VCAT 1414 at [36]–[44], esp at [44].
[240]Citing Air Services Australia v Canadian Airlines (1999) 202 CLR 133 at 189 [133] (Gaudron J).
[241](1999) 202 CLR 133.
[242](1999) 202 CLR 133 at 178 [92]. See also Joseph v Melbourne Water & Anor [2010] VCAT 1414 at [46].
In my view, the plaintiffs gain nothing from their reference to the distinction between taxes and fees for services.
Statutory purpose: summary
None of the submissions advanced by the plaintiff under the rubric of statutory purpose are of any assistance to it in this case.
Legislative history
The submissions that were advanced by the plaintiffs in their pre-trial written submissions under the heading ‘Legislative history’ are recounted above.[243] Those submissions were elaborated upon by the plaintiffs in their post-hearing written submissions, a particular aspect of which I have already mentioned.[244] The main contention advanced by the plaintiffs in this regard is that the statutory provisions now in question should be given an effect equivalent to the effect which, according to the plaintiffs, was had by certain repealed provisions of the Health Act 1958.[245]
[243][70]–[73].
[244][99].
[245]As the plaintiffs note, the repeal was effected by the Local Government (Consequential Provisions) Act 1989. That Act came into operation in conjunction with the coming into operation of the (1989) Act.
The argument cannot be accepted, for the following reasons.
First, the repealed provisions of the Health Act 1958 relied upon by the plaintiffs did not, in at least one important respect, have the effect which the plaintiffs would attribute to them. It is true that s 60(1) of the Health Act 1958, as first enacted and as in force thereafter until its repeal, empowered a local council to make and levy a ‘sanitary rate’ in respect of ‘all or any rateable properties in the municipal district’ for ‘the proper collection, removal and disposal of refuse and rubbish and of night soil or of refuse, rubbish and night soil’. Nevertheless, under s 60 a sanitary rate could only be made applicable to properties for which a direct or kerbside service of that kind was required and was to be provided. That was ultimately confirmed by s 60(3), which, to remove doubt about the power of councils under the old legislation to make relevant refunds,[246] was introduced in 1982 by the Health (Amendment) Act 1977. Section 60(3) empowered the council, in a case where ‘the services in respect of which the sanitary rate was paid are no longer required and will no longer be provided’ to refund to the person who paid the sanitary rate ‘an amount which bears the same proportion to the amount of the rate paid as the unexpired portion of the year bears to the whole year’. The Health (Amendment) Act 1977 also made a corresponding amendment to s 61, being the section which provided for the alternative of annual charges: see s 61(3A). Section 61(3) of the Health Act 1958 had at all times tied the imposition of the annual charge to proportionate periods of occupation of the relevant tenement. It can be seen that these provisions stand in stark contrast to s 173 of the (1989) Act discussed above. It follows that the plaintiffs’ theory, based on the so-called historical distinction between sanitary rates and annual charges, collapses. As already mentioned, the plaintiffs no longer contend, if they ever did, that, under the current legislation, even a service ‘rate’ must be confined to properties for which a kerbside refuse collection service is to be provided.
[246]Victoria, Parliamentary Debates, Legislative Council, 9 November 1977, 11066 and 11067; see also Explanatory Memorandum, Health (Amendment) Bill 1977, 1 referring to cl 4.
Second, the Health Act 1958 provisions were different in other ways too. They were contained in Part IV (General sanitary provisions) of that Act. They commenced with an express obligation on councils to undertake or arrange for works including the ‘removal of house and trade refuse and other rubbish from premises and the collection thereof’: s 48(1)(a) (my emphasis). There is no current statutory equivalent of that obligation. Nor does the word ‘removal’ appear in s 162 of the Act. Further, in addition to the abovementioned provisions of s 60(3) and ss 61(3) and (3A), there were other express provisions the language of which evidently tied rates and charges to direct or kerbside services for the collection, removal and disposal of refuse or rubbish: see, eg, s 61(1)(a) and (b).
Third, the plaintiffs have been unable to point to any extrinsic materials that expressly link the terms or the policy of the old Health Act provisions to s 162 or to any other provisions of the (1989) Act. Nor have I been able to find any.
Fourth, liability under the old Health Act provisions for both sanitary rates and annual charges rested primarily on occupiers, not on owners of the rateable property: see s 60(2) and s 61(2) of the Health Act 1958, read with s 267(1) of the Local Government Act 1958 (Vic). As mentioned above, the opposite is the case under the relevant current legislative provisions.
Fifth, the provisions of the Local Government Act 1958 were highly prescriptive. That was not so in the (1989) Act. Indeed, the learned authors of Victorian Local Government Law, A New System,[247] referring to the changes made by the (1989) Act, said:
Most of the changes have been substantial in their effect on the structure and operation of municipal councils and the cumulative impact has been so great that Victoria can now be described as having a “new system of local government”.
Consistently with this, the abovementioned broad and flexible powers of (democratically elected) Councils, including, pertinently, in relation to providing services ‘for the local community’, were largely a new feature introduced by the (1989) Act.[248] Further, waste management in Victoria, including recycling, had become a very different and much bigger thing. In 1992 it came to be governed by the elaborate provisions inserted into the Environment Protection Act 1970 by the Environment Protection (Resource Recovery) Act 1992.[249]
[247]I Lonie, T Bryant and L Groom, op. cit. at p 1.
[248]See also Regional Express Holdings Ltd v Dubbo City Council (No 3) (2014) 212 LGERA 41 at 66 [103] and [104], referring to similar changes concerning local government introduced in New South Wales at about the same time.
[249]Discussed at transcript, 118–119. See now Environment Protection Act 2017 (Vic) Parts 6.6 and 13. For a seminal article on this subject, see JD Hammond, A Growth Tax for the States? – Rubbish!, (1977) 4 Monash University Law Review 155.
Sixth, so far as ss 162(1)(a) and (c) are concerned, it appears from the plaintiffs’ post-hearing written submissions concerning the history of imposts relating to water and sewerage[250] that in each case there had been statutory provisions expressly tying ‘rates‘ to connections to properties. There were apparently no provisions for ‘charges’ in respect of the provision of a water supply or for sewerage. Accordingly, the plaintiffs gain no assistance in this regard.
[250]See [14]–[16] inclusive of those submissions.
Seventh, in any event, the plaintiffs’ resort to legislative history (including the previous state of the statutory law of Victoria) is far too ambitious in the current statutory context. It cannot justify such radical surgery to the provisions of Part 8 of the Act as the plaintiffs would call for.[251] Nor can I accept the plaintiffs’ suggestion that the current provisions merely reproduce the old law in Plain English.[252]
[251]See Robert Bosch (Australia) Pty Ltd v Secretary, Department of Industry, Innovation, Science, Research and Tertiary Education (2012) 206 FCR 92 at 111 [71]; D Pearce, op. cit. [3.36], [3.42].
[252]Compare Halwood Corporation Ltd v Roads Corporation [1998] 2 VR 439, 445 (Tadgell JA) and Secretary, Department of Social Security v Lowe (1999) 92 FCR 26, being cases relied on by the plaintiffs at [12] and [13] respectively of their post-hearing written submissions. There is no express suggestion in any extrinsic material that the current provisions of s 162 represent a Plain English version of the old law.
In summary, the plaintiffs’ analysis does not demonstrate that Parliament intended to continue any regime or regimes that applied under the repealed legislation.[253]
[253]Compare Mondelez Australia Pty Ltd v AMWU (2020) 94 ALJ 818, 823 [13] (Kiefel CJ, Nettle and Gordon JJ). See Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27, 46–47 [47] (Hayne, Heydon, Crennan and Kiefel JJ).
The application of the plaintiffs’ proposed construction of the Act
The matters advanced by the plaintiffs to support their (consequential) contention that the waste service charge is invalid add nothing new or significant.[254] The contention must fail because the plaintiffs’ proposed construction of Part 8 of the Act cannot be accepted.
[254]See [74]–[82] of this judgment.
Relief claimed
Similarly, there is no need to address what the plaintiffs put forward in relation to the relief claimed.[255]
[255]I note in passing that even this aspect of the plaintiffs’ case has been subject to considerable variation.
Conclusion and orders
As foreshadowed above, I will make an order extending time under r 56.02(3). The proceeding will be dismissed. I will invite submissions from the parties in writing as to costs.
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