Saizeriya Australia Pty Ltd v Melton Shire Council
[2003] VSC 258
•4 July 2003
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMERCIAL AND EQUITY DIVISION
COMMERCIAL LIST
No. 2031 of 2003
| SAIZERIYA AUSTRALIA PTY LTD (ACN 093 080 623) | Plaintiff |
| v | |
| MELTON SHIRE COUNCIL AND WESTERN REGION WATER AUTHORITY (ABN 67 433 835 375) | Defendants |
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JUDGE: | HABERSBERGER J | |
WHERE HELD: | MELBOURNE | |
DATE OF HEARING: | 20 JUNE 2003 WRITTEN SUBMISSIONS 24 AND 30 JUNE 2003 | |
DATE OF JUDGMENT: | 4 JULY 2003 | |
CASE MAY BE CITED AS: | SAIZERIYA AUSTRALIA PTY LTD v MELTON SHIRE COUNCIL & ANOR | |
MEDIUM NEUTRAL CITATION: | [2003] VSC 258 | |
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courts and judges – Supreme Court – Jurisdiction – Victorian Civil and Administrative Tribunal – Ouster of Court's jurisdiction in matters within the Tribunal's review jurisdiction – Exemption from ouster in "special circumstances" – Water Act ss.268, 269, 271 – Victorian Civil and Administrative Tribunal Act 1998 s.52.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr G.J. Digby QC and Ms S.M. Brennan | Freehills |
| For the First Defendant | Mr R.J. Sadler | Maddocks |
| For the Second Defendant | Mr M.A. Dreyfus QC and Mr M.H. Whitten | Russell Kennedy |
HIS HONOUR:
The Proceeding
In a proceeding commenced in the Commercial List on 30 May 2003, the plaintiff, Saizeriya Australia Pty Ltd ("Saizeriya"), sued the Melton Shire Council ("Melton") and the Western Region Water Authority ("Western Water"). The statement of claim made a contractual claim; a misleading or deceptive conduct claim and an unconscionable conduct claim under the Trade Practices Act 1974 (Cth) ("the TPA") and the Fair Trading Act 1999 ("the FTA") and a negligence claim against Melton. Further, the statement of claim made a misleading or deceptive conduct claim and an unconscionable conduct claim under the TPA and the FTA and a negligence claim against Western Water. In addition, the statement of claim pleaded that a notice dated 12 June 2002 ("the notice") and given by Western Water purportedly under s.269 of the Water Act 1989 ("the Water Act")was invalid.
The TPA and FTA claims against Western Water alleged that in about April 2000, Saizeriya entered into discussions with Melton and Western Water in contemplation of it purchasing land in the Toolern Vale Employment Park on which it would construct and operate a food manufacturing and processing plant. Part of the discussions concerned Saizeriya's likely water supply and waste water requirements. Saizeriya alleged that Western Water made a number of representations to it concerning the prospective supply of water to, and discharge of trade waste from, the land in question at no cost to Saizeriya, which induced it to purchase the land and commence construction of the plant. The statement of claim further alleged that by the notice Western Water required Saizeriya to pay a Development Major Works Charge ("the charge") in the sum of $343,420, which Saizeriya paid under protest.
The challenge to the validity of the notice was put in three different ways. First, it was alleged that the notice did not comply with certain procedural requirements of the Water Act and was therefore void. Secondly, it was alleged that the amount of the charge was not fair and reasonable and therefore that the notice was beyond power as Western Water did not have power to impose the charge unless it was "assessed by the Authority to be fair and reasonable in all the circumstances" (s.269(2)(a) of the Water Act). Thirdly, it was alleged that Western Water did not have power as part of the notice to require entry into agreements in relation to trade waste discharge. Declarations were sought that the notice was invalid, further or alternatively that the amount was excessive or wrongly calculated, further or alternatively that the notice was an element of conduct prohibited by the TPA and the FTA and thereby void and of no effect; that the amount required to be paid for the charge was not fair and reasonable and that Western Water had no power to require entry into agreements in relation to trade waste pursuant to sections 268, 269 or 270 of the Water Act.
The Application
On the return of the Summons for Directions, Saizeriya first applied for a direction under s.52(2) of the Victorian Civil and Administrative Tribunal Act 1998 ("the VCAT Act"). The plaintiff's application was supported by an affidavit sworn on 18 June 2003 by Dominic William Pilkington, a solicitor employed by Freehills, the solicitors acting for the plaintiff.
Section 52 of the VCAT Act provides as follows:
"52. Limitation of courts' jurisdiction in planning matters
(1)The Supreme Court, the County Court or the Magistrates' Court does not have jurisdiction to hear, or continue to hear, or determine any proceeding in which a person bringing the proceeding brings in issue the matter of the exercise of, or the failure to exercise, a power under a planning enactment if –
(a)the Tribunal has jurisdiction to review the matter of the exercise of, or the failure to exercise, that power; and
(b)the matter –
(i)has not been the subject of a proceeding in the Tribunal; or
(ii)if it has been the subject of a proceeding in the Tribunal, has not been determined by the Tribunal; or
(iii)if it has been determined by the Tribunal, the time for appeal against an order of the Tribunal in the proceeding has not expired; or
(iv)if an appeal has been brought against an order in the proceeding, the appeal has not been determined.
(2)If the Supreme Court, the County Court or the Magistrates' Court is of the opinion that there are special circumstances that justify the hearing by the Court of a proceeding to which sub-section (1) applies, the court may direct that sub-section (1) does not apply to that proceeding.
(3)If a court determines a proceeding to which sub-section (1) applies but does not give a direction under sub-section (2), nothing in this section invalidates the decision of the court.
(4) In this section –
'planning enactment' means –
(a) Catchment and Land Protection Act 1994;
(b) Environment Protection Act 1970;
(c) Extractive Industries Development Act 1995;
(d)section 41 of the Flora and Fauna Guarantee Act1988;
(e) section 185 of the Local Government Act1989;
(f)Planning and Environment Act 1987 (except sections 94(5) and 105);
(g) Subdivision Act 1988 (except sections 38 and 39);
(h)section 56 of the Transport Act1983 and regulations made under that section;
(i) Water Act 1989 (except section 19)."
This section was said to be relevant because, on 24 October 2002, Saizeriya had applied to the Victorian Civil and Administrative Tribunal ("the Tribunal") for review of Western Water's decision rejecting Saizeriya's objection to the notice. Pursuant to s.271(3) of the Water Act an owner may apply for a review on any of the grounds specified in sub-section 1(a) to (e). There were seven grounds of objection by Saizeriya. They were that:
(a)the notice had been purportedly given under s.269 of the Water Act in circumstances where that section did not apply;
(b)the notice did not comply with the procedural requirements of s.268(4) and s.269(3) of the Water Act;
(c)Saizeriya had no way of knowing whether other properties benefited from the services being developed and thus whether the basis of distribution of the cost between the owners of those properties was unreasonable (s.271(1)(b) of the Water Act);
(d)the amount was excessive, alternatively wrongly based and/or calculated (s.271(1)(c) of the Water Act);
(e)Saizeriya expressly reserved its right to contend that the notice was invalid on any other ground that was applicable;
(f)further and in the alternative, in the event that Western Water suggested that the notice was also issued under s.268 of the Water Act, Saizeriya relied on grounds (b) to (d) above and on other specified grounds pursuant to s.271(1)(t) of the Water Act; and
(g)Saizeriya relied upon representations by Western Water that the expenditure of $890,000 by Melton was the only major upfront moneys that would be required by Western Water before Saizeriya could operate its factory.
A response had been filed by Western Water, which put in issue the relevance for the purposes of a review pursuant to s.271 of the Water Act of many of the matters relied on by Saizeriya. At a directions hearing on 19 December 2002, it was noted by the Tribunal that Saizeriya had said that the application was:
"connected with a broader dispute about charges and may involve Supreme Court proceedings in which the validity of the notice issued by the Respondent may be sought to be impugned by the Applicant. The Respondent disputes that the Supreme Court can deal with the issue of the validity of the notice."
The matter is currently listed for an administrative mention on 21 July 2003.
The Submissions
Mr Digby QC, who appeared with Ms Brennan for Saizeriya, submitted that in the present case there were "special circumstances" justifying the making of a direction under s.52(2) of the VCAT Act. He referred me to the decision of Balmford J in No 2 Pitt Street Pty Ltd v Wodonga Rural City Council[1] in which her Honour considered the meaning of "special circumstances" in s.52(2) of the VCAT Act. Her Honour's view was that "special circumstances" meant something unusual or uncommon but not as far removed from the ordinary as exceptional or extraordinary.[2] Following the approach of Ashley J in Kantor v Murrindindi Shire Council[3] concerning s.66A(2) of the Planning Appeals Act 1980, the predecessor of s.52(2), her Honour found that the fact that this was the first opportunity for the Court to provide an authoritative ruling on important aspects of the Planning and Environment Act 1987 and the fact that it was undesirable that the plaintiff's causes of action should be split between fora (and one of the causes of action had to be litigated in this Court), took the matter out of the common run and constituted "special circumstances".
[1][1999] 3 VR 439
[2][1999] 3 VR 439 at 448, disagreeing with Beach J in Denysenko v Dessau [1996] 2 VR 221 at 224
[3](1997) 18 AATR 285
Mr Digby submitted that the present case was similar to the one before Balmford J in that there was no authoritative determination about the scope and operation of s.271 of the Water Act, the application of the TPA and the FTA to authorities under the Water Act, such as Western Water, and the interrelationship between the TPA, the FTA and the Water Act, and that it was desirable that all matters in dispute between the parties in relation to the validity and reasonableness of the notice under the Water Act be litigated in the one proceeding. He submitted that there was considerable overlap between the proceeding in this Court and the VCAT review. Mr Digby submitted that on a fair reading of paragraphs 37 to 43 of the statement of claim, they included the subject matter of the VCAT review. He referred, for example, to the particulars given in paragraph 42 in respect of the allegation that the charge was not fair and reasonable. Two of them – "(iii) The basis of distribution between owners of land in the Toolern [Vale] Employment Park is not ascertainable, further or alternatively is unreasonable" and "(iv) The amount is excessive" – were said to overlap completely with the grounds of review set out in s.271(1)(b) and (c) of the Water Act. Indeed, he said that each of these challenges to the notice in the statement of claim was on all fours with an issue raised before the Tribunal. Mr Digby finally submitted that the VCAT review would become unnecessary if the notice were declared void in this proceeding. In that event, it would be wasteful of costs to have the two proceedings both continuing to a hearing. He even volunteered to discontinue the VCAT review, if that were required by the Court as the price to pay for obtaining the required direction.
Mr Dreyfus QC, who appeared with Mr Whitten for Western Water, opposed the making of any direction under s.52(2) of the VCAT Act. His initial submission was that neither the TPA and the FTA and the negligence claims nor the challenge to the validity of the notice raised issues covered by the grounds of review set out in s.271(1) of the Water Act. He submitted that the Tribunal had no power to review whether procedural non-compliance made a s.269 notice void, no power to review whether an Authority had power to require payment of an amount which is not fair and reasonable, and no power to review whether an Authority had power to require entry into a trade waste discharge agreement. Therefore, the matters in issue in the VCAT review were not the same as the matters raised by Saizeriya in this proceeding. There was no overlap nor were they inextricably linked as claimed in the plaintiff's supporting affidavit. There was, therefore, no question of this Court not having jurisdiction to deal with the issues raised by the statement of claim and, accordingly, no reason to give a direction under s.52(2).
On the other hand, Mr Dreyfus submitted that if there were overlap then this had only occurred because the plaintiff was improperly seeking to have its s.271 review heard by this Court rather than by the Tribunal. Mr Dreyfus referred me to a passage in the judgment of Brooking J in Grollo Australia Pty Ltd v Minister for Planning and Urban Growth and Development[4], where his Honour described s.66A(1) of the Planning Appeals Act 1980 as follows:
"[It] in general deprives the courts of jurisdiction to hear and determine proceedings in which the plaintiff brings in issue the matter of the exercise of, or the failure to exercise, a power and the Administrative Appeals Tribunal has power to review that matter. Section 66A(1) obviously uses the term 'jurisdiction' in a rather special sense, for by the succeeding sub-sections of s.66A the court may give itself 'jurisdiction' and an exercise of 'jurisdiction' in ignorance or defiance of the section or under a misapprehension as to its effect is still good."[5]
Relying on this statement, Mr Dreyfus submitted that s.52 of the VCAT Act was not intended to be a "case transfer" mechanism, but was a bar to this Court hearing a proceeding or part of a proceeding which raised a particular class of matter. Mr Dreyfus submitted that s.52 should not be used to permit a party to raise issues in the Supreme Court which properly lay within the jurisdiction of a specialist tribunal constituted by specialist members with appropriate skills in assessing the review claim. He submitted that the review proceeding was substantially a technical, mathematical and economic exercise of determining the appropriate charge. Mr Dreyfus submitted that the legislation made clear Parliament's intention to have the Tribunal hear and determine review applications pursuant to s.271 of the Water Act.
[4][1993] 1 VR 627
[5][1993] 1 VR 627 at 647
Finally, Mr Dreyfus submitted that there were no "special circumstances" within the meaning of s.52(2) of the VCAT Act. He disputed that the same facts would be considered in this proceeding and the VCAT review. Thus, there was no possibility of differing or inconsistent findings. Further, he submitted that even if this was the first instance in which the Court had been called on to consider the interaction between the TPA and the FTA and the Water Act and the scope and operation of s.271 of the Water Act, this did not constitute "special circumstances". The Court could deal with the issues before it and the Tribunal could determine the review under s.271. Because there was no overlap, there was no duplicity of proceedings.
Mr Sadler, who appeared for Melton, made no submission on this application as the point did not affect his client.
After I had reserved my decision in respect of Saizeriya's application, Western Water, with Saizeriya's consent, put in a written submission dated 24 June 2003 urging that I defer giving a decision until pleadings in this proceeding were closed. It was submitted that until then the full extent of the proceeding, and the issues raised in it, would not be known. It was further submitted that the direction did not need to be made now for the purposes of the conduct of the proceeding. It could even be, and has been, made in a final judgment. The legislation itself ensured that the absence of a direction did not affect the validity of the proceeding (see s.52(3) of the VCAT Act).
Saizeriya responded with a written submission dated 30 June 2003. It opposed deferring the decision until the completion of pleadings. It was submitted that the circumstances giving rise to the operation of s.52(1) of the VCAT Act had been established and that there was no statutory or practical reason to wait for the completion of pleadings. It was not explained by Western Water why waiting for pleadings to close would alter the present position. It was purely speculation that there would be a relevant change in the pleadings. Thus, it was submitted that the Court should deal now with the application. Further, Saizeriya submitted that it was reasonable to infer that an application under s.52(2) of the VCAT Act should be made as soon as possible after the events which founded such an application came into existence. Finally, Saizeriya submitted that s.52(3) was subsidiary to s.52(2). It was not entitled to allow a direction from the Court to be dispensed with, but to cover a situation where neither the parties nor the Court were aware of the "jurisdictional" problem and to avoid the embarrassment of an invalid decision.
Deferring the Decision
I have seriously considered the submission that I should defer giving a decision on this application until pleadings in this proceeding were closed, and perhaps even beyond that. This is because I am still uncertain just what issues will be resolved by a decision in this proceeding. I am not completely persuaded that the current statement of claim really does involve this Court in deciding all aspects of the s.271 review and that the plaintiff will not have some residual matter from its s.271 review left over after the Court has given its decision in this proceeding. In the end, however, I have decided that I can, and should, make a decision in respect of the application at this stage.
Section 52(1) of the VCAT Act
In my opinion, the statement of claim in this proceeding does bring "in issue the matter of the exercise of … a power under a planning enactment" which the Tribunal had jurisdiction to review, within the meaning of s.52(1) of the VCAT Act. On the plaintiff's case, the Court is apparently being asked to decide the review of Western Water's decision on Saizeriya's objection to the notice instead of the Tribunal, which clearly gives rise to a s.52(1) issue. Opinions may differ as to whether that issue is raised by the statement of claim but even if that is not the case, the Court is still being asked, as part of the attack on the charge as being beyond power because it was not fair and reasonable, to decide whether the basis of distribution between owners of the properties that will benefit from the development is unreasonable and whether the amount of the charge was excessive. These are issues falling squarely within s.271(1)(b) and (c) of the Water Act, and to that extent they also give rise to a s.52(1) issue.
Section 52(2) of the VCAT Act
The final question for determination is whether there are "special circumstances" justifying the making of a direction under s.52(2) that s.52(1) of the VCAT Act does not apply to this proceeding. I agree, with respect, with the approach taken by Balmford J to this sub-section in No. 2 Pitt Street Pty Ltd v Wodonga Rural City Council[6]. As previously stated, her Honour expressed the view that "special circumstances" meant something unusual or uncommon but not as far removed from the ordinary as to be exceptional or extraordinary. Her Honour also relied on the following helpful guide from the judgment of Lopes LJ in Re Norman[7]:
"The statute uses the words 'special circumstances'. Those are wide, comprehensive, and flexible words, and I think that the legislature intended them to be so, and that no Court can or ought to lay down any exhaustive definition of them … It is for the discretion of the judge to say what are special circumstances in a particular case."
[6][1999] 3 VR 439
[7](1886) 16 QBD 673 at 677
Like Balmford J, I consider that it is undesirable that the plaintiff's causes of action should be split between fora. The misleading or deceptive conduct claim and the unconscionable conduct claim under the TPA and the FTA, the negligence claim and the invalidity of the notice claim made by Saizeriya against Western Water all have to be brought in this Court. Insofar as the statement of claim also includes the s.271 review of the Western Water's decision to reject Saizeriya's objection to the notice, it is appropriate, in my opinion, to have these issues all determined at the same time in the one proceeding. Even if it is only a question of this Court being able to decide whether the basis of distribution is unreasonable and whether the amount of the charge is excessive, the same reasoning applies. I see a very real possibility of inconsistent findings on such questions if the Court were to continue with the claim as currently formulated and the Tribunal were to determine the review. Both parties were agreed that the VCAT review could be put into abeyance for the present, if the direction under s.52(2) were made. This common sense approach means that the further problem raised by the plaintiff could be avoided. This was that if the Tribunal continued with its hearing, considerable costs would be thrown away if the Court were later to declare that the notice was void. For all of these reasons, it is most undesirable that the causes of action be split and, in my opinion, this fact constitutes "special circumstances" within the meaning of s.52(2) of the VCAT Act.
I am, therefore, prepared to make a direction under s.52(2) of the VCAT Act. I do not accept Mr Dreyfus' submission that to make such a direction is to fly in the face of Parliament's clear intention to have the Tribunal hear and determine review applications pursuant to s.271 of the Water Act. That is only the case if the Court is "not of the opinion that there are special circumstances that justify the hearing by the Court of a proceeding to which sub-section (1) applies." For the reason already given, I consider that such special circumstances do exist.
This finding means that it is not necessary to consider the other ground relied on by Mr Digby, namely, that this was the first opportunity for the Court to provide an authoritative ruling on the scope and operation of s.271 of the Water Act, the application of the TPA and the FTA to authorities under the Water Act, such as Western Water, and the interrelationship between the TPA, the FTA and the Water Act, and I say nothing about it one way or the other.
Subject to hearing further from the parties, the order I would propose making is as follows:
1.Pursuant to s.52(2) of the Victorian Civil and Administrative Tribunal Act 1998, it is directed that s.52(1) of the Victorian Civil and Administrative Tribunal Act 1998 does not apply to this proceeding, No. 2031 of 2003 (F5545).
2. Costs of this application are reserved.
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