Local government ­ Shire of Broome local law regulating trading in a public place ­ Shire of Broome Commercial and Tourism Activity of Cable Beach Policy ­ Proposed camel tours (3) on Cable Beach ­ Invitation to tender for licences ­ Whether tender constituted application for approval of trading licences under local law ­ Application fee ­ Licence fee ­ Whether licence fee can be the tender "price" ­ Whether decision to approve applications invalid on account of assessment of applications by reference to tender price

Interpretation Act 1984 (WA), s 45A

Land Administration Act 1997 (WA), s 1.4

Local Government Act 1995 (WA), s 3.1, s 3.15, s 6.15, s 6.15(1)(a)(iii), s 6.15(1)(b)(i), s 6.15(2), s 6.15(1)(a), s 6.16, s 6.16(2), s 6.16(2)(a), s 6.16(2)(b), s 6.16(2)(d), s 6.16(3), s 6.17, s 6.17(1), s 6.17(1)(a), s 6.17(1)(b), s 6.17(1)(c), s 6.17(2), s 6.17(3)(b), s 6.19, Pt 9, Div 1

Shire of Broome Local Government Property and Public Places Local Law 2003

Shire of Broome Trading, Outdoor Dining and Street Entertainment Local Law 2003, cl 1.3, cl 1.6, cl 2.2.2, cl 2.2.2(d), cl 2.2.3, cl 2.4.1, cl 2.4.1(b), cl 5.2.1, cl 5.4, cl 5.4.2, cl 5.4.1, cl 5.5, Pt 2, Pt 5

Decision of Council of Shire of Broome made 27 June 2006 set aside

Matter sent back to Shire for further consideration in accordance with these reasons

First Respondent : Mr AR Beech SC and Mr PL Wittkuhn

Second Respondent : Julia Barber & Co Barrister & Solicitor

First Respondent : Mr AR Beech SC and Mr PL Wittkuhn

Second Respondent : Julia Barber & Co Barrister & Solicitor

Rubibi Community v State of Western Australia (No 7) [2006] FCA 459

Bank of New South Wales & Ors v The Commonwealth & Ors [1948] HCA 7; [1948] 76 CLR 1

Dougherty v Dougherty [1987] HCA 33; (1987) 163 CLR 278

Environmental Protection Authority v Rashleigh [2005] ACTCA 42

Hughes v Western Australia Cricket Assn (Inc) [1986] FCA 357; (1986) 19 FCR 10

Jones v The Metropolitan Meat Industry Board [1925] HCA 54; [1925] 37 CLR 252

Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355

Re Hunt; ex parte Sean Investments [1979] HCA 32; (1979) 53 ALJR 552

Re Kierath; ex parte City of Fremantle [2000] WASCA 156; (2000) 22 WAR 342

Tillmans Butcheries Pty Ltd v Australasian Meat Industry Employees' Union (1979) 27 ALR 367

Trade Practices Commission v Ansett Transport Industries (Operations) Pty Ltd [1978] FCA 21; (1978) 20 ALR 31

1 In this case, the Tribunal set aside a decision of the Council of the Shire of Broome made 27 June 2006 approving three applications for trading licences made by Red Sun Camels Pty Ltd. The applications related to the proposed conduct of three camel tours on Cable Beach, Broome. The applicants in the proceedings were two of the unsuccessful applicants for the licences.

2 The Council approved the successful applicant's applications following a tender process. The Tribunal found that while the Shire had called for "tenders" it had in substance invited applications for trading licences under the Shire of Broome Trading, Outdoor Dining and Street Entertainment Local Law 2003, and assessed them as such.

3 The Tribunal found that the Council assessed all relevant applications by reference to weighted criteria that included a "Price - 50%" weighting_,_ by which the applicant stated the "annual licence fee" it was prepared to pay for the licence.

4 The Tribunal held that it was not open to the Shire under the Local Government Act 1995 (WA) to impose a "licence fee" in this way and so the decision-making process that had lead to approval of the three applications of Red Sun Camels was flawed. In effect, the Council had treated a licence as property it owned and which it was at liberty to sell to the highest bidder, a process not envisaged by the Trading Local Law or the Local Government Act 1995.

5 The Tribunal set aside the decision of the Council of 27 June 2006 and sent the matter of the determination of the applications back to the Shire for determination in accordance with the Tribunal's reasons for decision.

6 However, the Tribunal expressed the tentative view that, while the power of a local government to impose a licence fee under s 6.16(2)(d) of the Local Government Act 1995 is limited, there may be greater scope under s 6.16(2)(a) to impose a use fee that reflects the true incidence of providing for the use of Cable Beach for camel tours.

• whether a decision of the Council of the Shire of Broome made on 27 June 2006, following an invitation to tender process was in substance a decision to approve the applications of Red Sun Camels Pty Ltd (the second respondent in these proceedings) for trading licences to operat Law came into operation. The Trading Local Law was made under the Shire of Broome's general local law-making power conferred on all local governments by the Local Government Act 1995 (WA), s 3.1 and s 3.15.

9 The purpose of the Trading Local Law, as described in cl 1.3, is to provide for the regulation, control and management, amongst other things, of trading in any public place in the district of the Shire of Broome. To this end, Pt 5 deals specifically with trading. "Trading" is defined by cl 1.6 to include the hiring or the offering for hire of services in a public place. A "public place" is defined by cl 1.6 to mean, amongst other things, a place which the public are allowed to use, and includes reserves and beaches.

• the activity of offering camel tours to the public for reward is "trading" as defined;

• the carrying on of such an activity at Cable Beach, Broome - whether on that part of Cable Beach known as Reserve 36477 (in respect of which the Shire is the management authority under the Land Administration Act 1997 (WA)) or the adjacent vacant Crown land (VCL) to the north of the Reserve (that has been called "Cable Beach North" in these proceedings) - involves trading in a "public place".

11 Clause 5.2.1 of the Trading Local Law relevantly prohibits a person from carrying on trading as defined, unless they hold a valid trading licence, and meet the conditions of the licence and the provisions of the Trading Local Law.

12 Clause 5.5 provides that an applicant for a trading licence "shall comply with clause 2.2.2" and shall forward the application to the local government with the range of information about the proposed trading.

13 Clause 2.2.2 provides that an application shall -

(a) be in the form determined by the local government

(c) provide the information required by the form or by any other clause of this local law; and

(d) be forwarded to the local government together with the application fee.

14 Normally the use of the word "shall" in legislation or subsidiary legislation indicates the imperative; it is something that must be done and there is no leeway. However, cl 2.2.3 goes on to provide that the local government "may refuse to consider or determine an application for a licence" which is not in accordance with sub-clause 2.2.2 or any other clause relating to the requirements to be complied with when making an application for a licence. This raises the question whether in fact some leeway may be given by the local government if an application is not lodged exactly as it should be.

15 Even though cl 5.5 also requires the applicant for a trading licence to comply with cl 2.2.2, I do not consider this means that cl 2.2.3 can be ignored. Clause 2.2.2 and cl 2.2.3 are in Pt 2 of the Trading Local Law, which part is intended to have general application to all licence applications under the Trading Local Law. Clause 5.5 serves to remind an applicant of the usual need to meet the prescribed formalities.

16 Clause 2.2.3 similarly serves to reinforce the usual need for an applicant to comply with cl 2.2.2 and other relevant provisions. However, cl 2.2.3 also serves to highlight the fact that, in making cl 2.2.2, the Shire did not intend to create an overly rigid approval process - a rod for its own back, if you like - by being obliged, for example, not even to consider an application which has not been made on the prescribed form. Clause 2.2.3 means the Council is able to decide in a given case whether it requires strict compliance with its usual requirements before considering or determining an application.

17 However, I consider there are limits to this proposition. For example, I do not think that cl 2.2.3 can be relied upon effectively to waive the fee requirement, as the Trading Local Law makes separate, special provision for the waiver of fees, as explained below.

18 Having said that, one would think that in order to meet the intent obligations set out in s 1.3 of the Local Government Act 1995, the local government would ordinarily insist on strict, or at least substantial, compliance with the requirements of its own Local Law unless there were a good reason to depart from them in a given case.

19 In relation to fees, it is important to note at this point that Pt 2 of the Trading Local Law provides for two different sorts of fees to be paid in the trading licence process:

20 Clause 5.4 enables the Shire to waive the application fee referred to in cl 2.2.2(d), or the licence fee referred to in cl 2.4.1(b), or both, in certain circumstances, neither of which is relevant to this case.

21 Clause 2.2.2(d) implies that the application fee is payable before a decision is made to approve a trading licence.

22 The licence fee is payable, by proper interpretation of cl 2.4.1, after the local government has approved the application for the licence.

23 Though it might be said that a successful applicant for a licence is not obliged to take the second step and pay the licence fee, the legal position is clear enough. The local government is not obliged to issue the trading licence until the licence fee is paid. This flows from cl 2.4.1, which provides:

(a) the local government approves an application for a licence; and

then the local government shall issue to the applicant a licence..."

24 Unless an applicant takes the step of obtaining the trading licence, the applicant will not be able to avoid the proscription in the Trading Local Law against trading without a licence.

25 Returning to cl 2.2.3, while cl 2.2.3 may enable the local government to give some leeway to an application that does not strictly satisfy the requirements of the Local Law, I do not think an application can be granted without the relevant application or licence fee having first being paid.

26 In my opinion, this is so because of the express power of the local government given by cl 5.4 to waive an application fee or a licence fee in certain circumstances. The more general power conferred by cl 2.2.3 to refuse to consider or determine an application, cannot, in this context, be treated as the additional source of a power to waive those fees.

27 Clause 5.4 of the Trading Local Law contemplates the waiver of the requirement to pay any relevant fees in only two circumstances, neither of which is applicable in this case as none of the relevant parties is a "charitable organisation" for the purposes of cl 5.4.1 or proposes trading on a portion of a public place adjoining their normal place of business.

28 So, two important points flow from the way the Shire have made the Trading Local Law:

(1) An application for a trading licence cannot be approved until any prescribed application fee is made - or waived by the local government under cl 5.4. If this is not an express requirement of the Trading Local Law it is, in my opinion, nonetheless a requirement of the Trading Local Law properly interpreted.

(2) The trading licence cannot be issued until any relevant licence fee is paid by the successful applicant - or waived by the local government under cl 5.4.

29 For these reasons it may be considered appropriate to speak of the trading licence process as involving two stages -

• Approval of the application for a trading licence, preceded by the payment of any relevant application fee.

• The issue of the trading licence after the payment of the relevant licence fee by the successful applicant.

30 Now, for this two-stage trading licence process to take full effect - especially from the local government's fee collection perspective - the local government needs to have imposed the relevant -

31 As explained further below, the Local Government Act 1995, especially by s 6.15 and s 6.16, authorises a local government to impose a range of fees and charges.

32 In this particular case, as explained below, the Shire of Broome has not in fact imposed an application fee for a trading licence application. Nor has it imposed a licence fee, although, again as explained below, in this case it clearly intends that something called an "annual licence fee" should become payable upon the issue of a trading licence.

33 The circumstances of this case, however, become complex, or confused, because it is not clear exactly by what authority or approval process the local government proposes to impose an "annual licence fee", and if it is open to it to do so in any event.

34 As noted earlier, on 19 March 2004, the Trading Local Law came into operation. By reason of concerns expressed by the Council of the Shire of Broome about the need properly to regulate and balance competing interests and activities on Cable Beach, on 21 December 2004, the Council resolved to review its existing Commercial and Tourism Activity on Cable Beach Policy.

35 On 22 March 2005, the Shire engaged a consultant in effect to prepare a new Policy.

36 On 6 October 2005 at an ordinary meeting of the Council, the Council resolved to adopt the new Policy.

37 The new Policy, as it states in its "Introduction", is intended for the guidance of officers in the administration of the Trading Local Law. In practice, it is also intended to assist the Council of the Shire in the exercise of its approval powers under the Trading Local Law. The Introduction notes, as one would hope and expect it would, that Cable Beach is a "highly valued environmental, cultural and social asset of the Shire".

38 The Introduction also notes the Council's obligation to ensure that commercial activities operated on Cable Beach "are consistent with public safety and environmental and cultural values".

39 Additionally, the Introduction states:

"To manage the beach environment in a sustainable manner and at the same time satisfy market needs and generate a resource to manage Cable Beach, only commercial and tourist activities that are compatible with the values expressed in the Goals of Management will be considered for approval."

40 The Goals of Management are then set out in the Policy. It might be noticed in passing that none of them expressly lists the "generation of a resource" (or the like) as a goal.

41 The Policy applies to an approved range of commercial activities along Cable Beach from Gantheaume Point in the south, to a point west of Murray Road in the north. The commercial activities include camel tours. Most if not all the particular activities referred to in the Policy have been carried out on Cable Beach for some years.

42 The Policy is not intended to be a passive policy; rather it envisages the active involvement of the Shire in its implementation. This perhaps is not surprising as the Council through the Policy seeks to respond to commercial pressures on Cable Beach and, sensibly, wants to be proactive in dealing with them. In any event, rather than wait for the market to come to it, the Shire decided to go to the market.

43 To this end, the General Policy Statement in the Policy, states:

"Council will invite tenders pursuant to section 6.16(2)(a) of the Local Government Act 1995 for approval to use land managed and controlled by the Shire".

44 I should interpolate here to say that s 6.16(2)(a) of the Local Government Act 1995 does not say anything about inviting tenders for approval to use land managed or controlled by a local government. What it does say is that a local government may impose a fee "for providing the use of, or allowing admission to, any property or facility wholly or partly owned, controlled, managed or maintained by the local government". Whether the power to impose a fee under this provision is consistent with a tender process is the central issue in this case.

45 The General Policy Statement goes on to state:

"Council will assess applications for approval to operate ... activities as applications for a trading licence under Part 5 of the Local Law. Applications will be assessed in accordance with the Local Law and the assessment criteria set out in the Policy."

46 As a general observation, it must be borne in mind, of course, that a Policy of this kind, is only a policy. Such a policy does not have statutory effect, as a local law does. However, a well-made policy can be very useful in achieving open, accountable and consistent decision-making. In this case, it is intended to help guide the discretion of the local government in the trading licence process under the Trading Local Law. But the Policy cannot usurp the requirements of the Trading Local Law or the Local Government Act 1995. It is but an aid to the Council of the Shire in exercising its approval powers under the Trading Local Law.

47 This is not to suggest, however, that it is or was intended by the Council at any material time that it should give undue prominence to the Policy in the trading licence process, at least as initially drafted. Indeed, the general expressions of policy intent and implementation made in the Policy, are predicated on an understanding that approvals and licences are required under the Trading Local Law, and that fees must be imposed under the Local Government Act 1995 to give effect to the Trading Local Law, before any trading can be carried out on Cable Beach.

48 The Policy then sets out Application Procedures, which specify that "applications may only be made in the form required by the Invitation to Tender document", which tender document is said to form part of the Policy. Applicants are then reminded to provide the information required in the Invitation to Tender document and the Trading Local Law.

49 The Policy then sets out Assessment Criteria that "shall be applied in the assessment of applications for trading licence". It also states - not unreasonably - that applications will only be considered for certain types of activities, including three camel tours (each with a maximum of 16 camels on Cable Beach at any one time). This statement of policy gives prospective applicants a pretty good idea of the extent to which the Council will be prepared to go in the exercise of its discretion under the Trading Local Law. For example, prospective applicants know that the Council will be unlikely to approve more than three camel tour licences. This is not an unreasonable limit for the Council to intimate in a policy of this kind; no party to these proceedings suggests otherwise.

50 Again, in passing, one might note that the Assessment Criteria do not make any express reference to the need for the local government to "generate a resource".

51 The Policy finally notes what the conditions of approval to be attached to a licence will be, and grounds for cancellation of a licence.

52 Then, in January 2006 the Shire published an Invitation to Tender in The West Australian and the Broome Advertiser newspapers. The Invitation to Tender referred, amongst other things, to the three camel tours. It should be noted that the opening words of the Invitation to Tender, consistent with the language of the Policy, state:

"In accordance with the Shire of Broome Trading ... Local Law 2003 and the Shire's Policy... the Shire of Broome extends an invitation ..." etc.

53 By the Invitation, tenders were required to be submitted by 20 March 2006. The Invitation to Tender also referred to a "Selection Criteria and Specifications" document. The Selection Criteria and Specifications document is a very important document in the context of these proceedings. It sets out the formal requirements relating to the preparation of a tender and, to an extent that is not evident in the Policy itself, specifies, under the heading "Licence", that the Shire will require the successful applicant to enter into a "Licence Agreement" in accordance with the general conditions outlined in the specification. A "Draft Licence Agreement" is attached to the document.

54 The Selection Criteria and Specifications document also refers to Contract Conditions, which state in part:

"Licence fee to be paid in advance. It may be paid in two moieties..."

55 The document then sets out particular selection criteria by reference to a two stage process: applicants first need to address "essential criteria"; if their application satisfies these, it will then be "eligible" for assessment against "weighted criteria". The document then states that the Shire will "select those that best satisfy the criteria".

56 The essential criteria deal with the capacity of an applicant to carry on the proposed activity. The weighted criteria also reflect capacity and experience factors, but go further. The first weighted criterion is "Price - 50%". The others are "Equipment - 15%", Experience - 20%, Operational planning - 10%, and "Value Adding - 5%".

57 Under the heading "Price - 50%" the weighted criterion is stated as follows:

"Applicants must submit a price for the annual licence fee that they are willing to pay the Shire in order to be able to conduct the proposed activity on Cable Beach."

58 For the first time, at least in the documentary history before the Tribunal, the significant weighted criteria of "price" comes to the fore. The "price" agreed by the local government will it seems become the "annual licence fee".

59 In the event, a total of eight tenders from six operators were received for the camel tours licences. One operator (the second respondent) lodged three tenders.

60 At its ordinary meeting held on 13 April 2006 Council considered the matter of "tender assessment" and resolved (Item 9.3.7 of the Minutes) to appoint a working group comprising three Councillors, the Manager Health Services and the Director Development Services to assess and report back to Council on the tenders received to trade on Cable Beach for five years from 1 January 2007.

61 The working group so set up considered the tenders and referred the matter back to Council for further direction. At a special meeting of Council on 8 June 2006, the Council resolved (Item 9.3.1 of the Minutes):

"That Council appoints a working group comprising three Councillors, Manager Health Services and the Director Development Services to assess and report back to Council on the Tenders received to trade on Cable Beach for five years from 1 January 2007 be revoked."

62 At a further special meeting held on 8 June 2006, Council resolved:

"That Council appoints a panel comprising all Councillors to assess the Tenders received to trade on Cable Beach from 1 January 2007."

63 The tenders received were assessed by the panel of all Councillors of the Shire in accordance with the Assessment Criteria published in the Request for Tender and on 8 June 2006 Council passed the following relevant resolutions relating to the camel tour tenders:

• That three tenderers... not be assessed due to the fact that the Tenders had not demonstrated that they meet the Essential Criteria for appropriately zoned land.

• That the Tender from Ship of the Desert be assessed as Council in its absolute discretion believes that the applicant is capable of receiving planning approval by 1 January 2007 on appropriately zoned land indicated in the Tender.

(1) The Tenders submitted by Red Sun (Preference 3), Ships of the Desert and Broome Camel Safaris are the preferred Tenders.

(2) That the Invitation to Tender, all Tenders received and the assessment documentation submitted for audit by an appropriately qualified firm of accountants to be appointed by the CEO.

(3) Following the advice and recommendation of the independent Auditor that the item be bought back to Council for further consideration.

64 On 27 June 2006, following receipt of the audit report required by Council's resolution of 8 June 2006, the camel tour licence matter was again considered at a special meeting of Council. The Council then resolved that:

"The tender from Red Sun Camels for the three licences be accepted and that the conditions for the three licences come back to Council for final approval."

65 When carrying this resolution on 27 June 2006, Council gave as its reason (or otherwise explained) that:

"Council's preferred position would be to retain the nominated Tenders as resolved at the previous Special Meeting to consider Tenders received for Camel Licences. As a result of the process, Council feels compelled to accept the legal and audit advice received that the Tenders received be weighted under the weighting process, and as a result, the Tender be accepted."

66 At the date of the hearing before the Tribunal "contract documentation" had not been prepared or executed by the Shire, pending a determination by the Tribunal of the current proceedings.

67 In my view, having regard to the two-stage trading licence process explained earlier in these reasons, the Shire's resolution of 27 June 2006 in substance purports to approve the three trading licence applications of Red Sun Camels Pty Ltd, the second respondent in these proceedings, made under and for the purposes of the Trading Local Law. While it remains for the Council formally to affix conditions to the "three licences" (as they are referred to in the Council's resolution), it is only the conditions that require "final approval". The substantive decision to approve the three application has been made.

68 By doing so, on 27 June 2006, the Shire also refused (amongst others) the trading licence applications of the applicants in these proceedings.

69 However, the Shire is yet to actually issue trading licences to the second respondent and can only do so when the licence fee is paid, as required by the Trading Local Law, unless any such fee is waived under cl 5.4 of the Local Law.

70 Submissions by senior counsel for the second respondent, and to an extent the Shire, to the effect that all that has happened to this point is the completion of a tender process in respect of a contractual, non-statutory licence to use Cable Beach that is unrelated to the trading licence process required under the Trading Local Law, fails to have proper regard to the factual circumstances and history set out above.

71 In short, the local government, by specifying in the Policy that tenders would be invited "pursuant s 6.16(2)(a) of the Local Government Act 1995", and assessed as "applications for a trading licence under Part 5 of the Local Law", and by stating that the applications would be assessed in accordance with the Local Law and the Assessment Criteria set out in the Policy, was, at best, confused in its approach by suggesting, on the one hand, that the tenders would be treated as trading licence applications under the Local Law, and then indicating, on the other hand, that they would also result in Licence Agreements for the use of property controlled and managed by the local government.

72 However, as the Policy itself discloses, the local government well understood when it adopted the new Policy, that the relevant commercial activities on Cable Beach needed to be authorised in the manner provided for by the Trading Local Law.

73 Nonetheless, what seems to have been in the Shire's mind all along - or at least from the time the Selection Criteria and Specifications document was published - is that applicants should be invited to state the licence fee they were prepared to pay in the event the Council approved their application for a trading licence. That "licence fee" was to be confirmed in a "Licence Agreement" which was to be put in place, presumably, before a licence was issued under the Trading Local Law.

74 While all this might be considered a commercially good arrangement from the Shire's point of view, and was and is apparently acceptable to the successful applicant for the three camel tour licences (the second respondent), it is not a process I consider to be open to the Council under the Trading Local Law or the Local Government Act 1995. The problems with it arise from the Shire's attempt to "generate a resource" through a local law licensing process and a statutory fee imposition process. It also assumes, in effect, that a licence is property belonging to the local government that it is at liberty to sell to the highest bidder.

75 As explained earlier, the Trading Local Law made by the Shire is based on a two stage trading licence process:

• an application for a trading licence approved by the Shire with any relevant application fee having been paid before approval; and

• the issue of a licence following the payment of the licence fee by the successful applicant.

76 As to the stage one process - the application approval step - the local government, in my view, has treated all tenders as trading licence applications, with the result that on 27 June 2006 the Council purported to approve the three applications of the second respondent - even though no application fee had then been paid to the Shire by the second respondent, or for that matter by any other applicant who participated in the tender process.

77 There is of course a very good reason why these application fees were not paid, and that is because, as a matter of fact, the Shire had not imposed an application fee under the Local Government Act 1995 for the purposes of the Trading Local Law. As a result, there was no obligation on any applicant to pay an application fee when it lodged its tender/application for approval.

78 The Local Government Act 1995 s 6.15 permits a local government to receive revenue or income from a range of specified sources, including "fees and charges" (subsection (1)(a)(iii)) and "dealings in property" (subsection (1)(b)(i)).

79 Section 6.16(2)(d) of the Local Government Act 1995 is the usual provision relied on to support the imposition of a fee by a local government for:

"receiving an application for approval, granting an approval, making an inspection and issuing a licence..."

80 There are however clear rules governing the imposition of all fees and charges. A fee or charge imposed must be imposed by an absolute majority of the Council when adopting the annual budget or during a financial year, as required by s 6.16(2) and (3).

81 Further, under s 6.17(3)(b), a licence fee or charge under s 6.16(2)(d) is limited to "the cost of providing the service".

82 Because of this latter limitation on setting a licence fee under s 6.16(2)(d), and the desire of the Shire to "generate a resource", the Council seems to have chosen to adopt the tender pathway to the setting of a licence fee and to have placed reliance on the fee-setting power contained in s 6.16(2)(a) of the Local Government Act 1995. This is the section referred to in the Invitation to Tender, that permits the Council to impose a fee or charge for:

"providing the use of, or allowing admission to, any property or facility wholly or partly owned, controlled, managed or maintained by the local government."

83 Considerable attention was given during the hearing of these proceedings to the question whether s 6.16(2)(a) of the Local Government Act 1995 could be relied upon by the Shire of Broome to set a fee, and in particular the licence fee - or "price" - proposed by the second respondent in the tender/application process, and accepted by the Shire, in this case. The resolution of the Council of 27 June 2006 plainly involved an acceptance of the price proposed by the second respondent for each licence. Indeed, because of the 50% price weighting factor in the approval process - and the fact that the second respondent offered to pay $100 000 per licence - the Council felt it had no alternative but to give all three licences to the second respondent.

84 If the Council's approach in according a weighting (be it 50% or any other weighting) in the approval process to the "price" an applicant is prepared to pay for a licence is not open to it, then the decision of 27 June 2006 should be reviewed.

85 The Shire contends that s 6.16(2)(a) is the basis of, or can support, the "licence fee" generated by the tender application process.

86 As to this contention, a number of observations need to be made. First, as I have already stated, in my view the Shire has not purported to act wholly on the basis that it has a broad right under s 6.16(2)(a) to undertake the act of providing the use of, or allowing admission to, property controlled, managed or maintained by the Shire at Cable Beach independent of the trading licence process provided for by the Trading Local Law. At best, it has confused its function in licensing activities in the public interest under the Trading Local Law and, assuming it has the power to do so, imposing a fee under s 6.16(2)(a) for providing the use of, or allowing the admission to, Cable Beach, on the basis that it is property it wholly or partly controls, manages or maintains.

87 By the process it has adopted, considered as a whole, the Council has purported to approve the tenders/applications of the second respondent as applications for trading licences. In doing so the Council has acted in the belief that, once the proposed Licence Agreement is signed and the proposed "annual licence fee" has been paid, a trading licence will be issued under the Local Law. This, at least, seems to be what the Shire has had in mind.

88 In effect, the Council has rolled together the power to impose a licence fee for the purposes of the Trading Local Law, on the one hand, and under the proposed "Licence Agreement", on the other. It seems to have thought that the payment of a fee via the medium of the Licence Agreement would also meet the requirements of the Local Law. The Licence Agreement idea owes nothing to the Local Law. The Local Law does not provide for such an agreement. The Licence Agreement proposal is put forward as a contractual arrangement supported by the power of the local government given or implied by s 6.16(2)(a) to provide for the use of Cable Beach.

89 However, assuming for the moment that it is open to the local government to impose a fee for, in effect, "licensing" activities on Cable Beach pursuant to s 6.16(2)(a), I do not consider that this fee-setting power enables the local government to adopt, as the fee, any price an applicant is willing to pay for the "licence".

90 In my view, any fee or charge imposed under s 6.16(2)(a) must bear a proper relationship to the "use" of the relevant property provided for, or the "admission" to the relevant property allowed, and the fee provision cannot simply be used to create a revenue stream unrelated to ownership, control, management or maintenance issues arising from such use or admission.

91 This limitation on the s 6.16(2)(a) fee power seems to me to flow from the terms of s 6.16(2)(a) itself and the fact that it is, in the end, a fee for a service that is being provided. Section 6.15 makes it clear that a local government may only receive revenue or income from the categories nominated in subsection (1)(a) and (b). Section 6.15(2) expressly provides that nothing in subsection (1)(a) - which refers to "fees and charges" - authorises the making by a local government of a local law providing for the receipt of revenue or income by the local government not contemplated by or under the Local Government Act 1995. In my view, s 6.16(2)(a), reinforced by s 6.15, does not authorise the collection of fees or charges unrelated to the service provided.

92 Additionally, if s 6.17(1) of the Local Government Act 1995 applies to the setting of a fee under s 6.16(2)(a), as I think it does - on the basis that, properly construed, all the fees and charges that a local government may impose under s 6.16 are in respect of the provision of "services" - then s 6.17(1) has a similar effect to that which I have just described. This is because s 6.17(1) states that in setting a fee or charge, a local government "is required to take into consideration" the following factors -

"(a) the cost to the local government of providing the service or goods;

(b) the importance of the service or goods to the community; and

(c) the price at which the service or goods could be provided by an alternative provider."

93 While I think that factors other than those set out in subsection (1) might possibly be considered in setting a fee, these three are plainly considered by the Parliament to be pre-eminent considerations and so must be considered. Accordingly, where s 6.17(1) applies, the local government must first consider "the cost to the local government of providing the service or goods".

94 In this case, I consider that, if a fee can be set in the circumstances of this case under s 6.16(2)(a), then the Shire by "providing for the use of, or admission to" Cable Beach, on the basis it is property controlled, managed or maintained by the local government, is properly to be characterised as a "service".

95 The s 6.17(1)(a) factor on its own suggests that the fee should primarily be set by reference to demonstrable "costs to the local government" of providing that service.

96 I do not think that, in the circumstances of this case, the factor set out in s 6.17(1)(b) can be called in aid of a proposal to set a fee based on the price that an applicant is prepared to pay for a licence. The service being provided, namely, the use of or access to Cable Beach by an operator of a proposed camel tour, is the service in question. The provision of this service may be important to the community, as it may, in broad terms, directly benefit the local economy. The "service" is not the receipt of a "licence fee" by the Shire. If anything, this factor suggests that the local government should not charge a fee which is too high and so likely to dissuade a person from offering to provide a service from which the local economy might benefit.

97 The factor in s 6.17(1)(c) also would not appear to be relevant here. However, by drawing attention to what an alternative provider would charge for the provision of a similar service, the factor also suggests that the local government should take care not to impose an excessive fee.

98 That said, s 6.17(2) recognises that a higher fee or an additional fee may be payable in some circumstances attended by urgency.

99 Section 6.17, taken as a whole, discloses an intention by Parliament that the fees and charges should be reasonable and bear some proper relationship to the provision of the service or goods to which they relate. It is difficult to see how that intention is met by the proposed imposition of a fee that is simply the price an applicant is prepared to pay for a licence. The latter process involves no real consideration by the local government of the incidence of providing the use of property and what a proper fee should be in light of those incidence.

100 I also note that s 45A of the Interpretation Act 1984 (WA) states that a power to impose a fee for a licence includes a power to impose a fee that will "allow recovery of expenditure that is relevant to the scheme or system under which the licence is issued". If a fee proposed under s 6.16(2)(a) is truly a licence fee, then this provision suggests a similar outcome to that suggested above.

101 In this case, the Tribunal finds that the Council, by adopting the tender process, has made no attempt itself to assess what a proper fee should be in relation to it providing for the use of Cable Beach by the proposed traders. Rather, Council of the Shire of Broome has simply abdicated its responsibility to set a fee under the Local Government Act 1995 in accordance with the requirements of the Act by saying, in effect, that it will grant a licence and set a licence fee based on the highest bid in the tender process. In effect, the Shire has wrongly treated a licence as if it were property of the Shire that the Shire is entitled to sell to the highest bidder. However, the purpose of the Trading Local Law and the provisions of s 6.16 of the Local Government Act 1995 is to permit the local government to regulate activities in the public interest.

102 Additionally, I do not consider the process by which the current "licence fee" proposed to be imposed by the Shire after the approval of applications but before a licence fee is actually imposed under s 6.16 (whether imposed under s 6.16(2)(a) or s 6/16(2)(d)) to be either in accordance with the spirit or the letter of the Local Government Act 1995 or the Trading Local Law.

103 The usual way one would expect fees to be set under s 6.16 of the Local Government Act 1995 and for the purposes Trading Local Law is as follows:

• Council should impose a fee for receiving an application for approval with appropriate notice being given to the local community as required under s 6.19, that is in place before applications are made for a trading licence.

• Similarly, a fee payable on the granting of approval, the making of inspection and the issuing of a licence, and any other fee that may be payable in respect of providing the use of, or allowing admission to, any property wholly or partly controlled, managed or maintained by the local government, should also be imposed with notice being given under s 6.19 in advance of applications for the licence being made.

• These fee impositions must be made with an absolute majority as required by s 6.16(2) and s 6.16(3).

104 In this way the local public generally and applicants for licences know exactly where they stand before making an application. Such a system is likely to advance the intent of better decision-making, greater community participation, greater accountability and more efficient and effective local government referred to in s 1.3(2) of the Local Government Act 1995.

Comment on the fee-setting power in s 6.16(2)(a)

105 I am conscious that I have not finally stated whether I consider it is open to the Council to impose a licence fee for the purposes of the Trading Local Law, or generally under s 6.16(2)(a). I have found it unnecessary to do so because, even if the power exists to set a fee under that provision, for the reasons I have just given the Council has failed to exercise it properly by adopting the tender approach to fee setting. I am also reluctant to say more than is necessary to decide this case. This is especially so in circumstances where the Shire has, as I have observed, confusingly rolled together the licensing process required by the Trading Local Law, with powers it may have to set a fee under s 6.16(2)(a). Nonetheless, some tentative observations may be permitted and may be helpful to all parties concerned.

106 Senior counsel for the applicants says that it is not open to the Council to set a licence fee under s 6.16(2)(a). The main contention put forward is that the Council can only impose a fee under this section if it in fact has the power to control use or entry to the property in question. In other words, the local government needs to establish that it has some proprietary interest - some interest in Cable Beach itself - that permits it to exercise such control. Senior counsel says that in this case, so far as the VCL north of the Reserve on Cable Beach is concerned - the area where the camel tours mainly operate - the Shire has no proprietary interest. The evidence shows that, in that area, the Crown - or State - has the ultimate title. Additionally, native title rights have been determined in favour of an Aboriginal community under the Native Title Determination Rubibi Community: see Rubibi Community v State of Western Australia (No 7) [2006] FCA 459. It appears that the Cable Beach north area is an "exclusive native title area".

107 Senior counsel for the Shire contends, on the other hand, that a fee or charge may be imposed under s 6.16(2)(a) whenever, as a matter of fact, the local government can demonstrate that it wholly or partly owns, or controls, or manages, or maintains any property or facility. It is implicit in the submission made on behalf of the Shire, that where such a factual circumstance can be made out, s 6.16(2)(a) is itself the source of a local government's power to provide the use of, or allow admission to such property.

108 As a matter of fact, there is evidence to show that the Shire of Broome maintains a degree of surveillance over activities on Cable Beach. Most, if not all, of these activities are conducted by officers of the Shire for the purpose of enforcing local laws, such as the Local Government Property and Public Places Local Law 2003, as well as the Trading Local Law.

109 Ordinarily, the language of control and management suggest land in respect of which a management order has been made under the Land Administration Act 1997 (WA) under which the local government is the management authority. In this regard, the Local Government Act 1995 makes reference to "local government property", which is defined by s 1.4 to mean anything, whether land or not, that belongs to, or is vested in, or under the "care, control or management of" the local government.

110 However, the expression "local government property" has not been used in s 6.16(2)(a). Instead, we find the words "property or facility wholly or publicly owned, controlled, managed or maintained by the local government". It will be noticed that the word "maintained" does not appear at all in the definition of "local government property".

111 In the context of the Local Government Act 1995, there is a good argument that the interpretation of s 6.16(2)(a) should not be controlled by the definition of "local government property" and should be interpreted literally. If this approach is adopted, the words "controlled, managed or maintained by the local government" invite distinct inquiries as to whether there is any property that answers that description.

112 The fact that the local government controls behaviour and activities on Cable Beach under its local laws, and to this end undertakes surveillance and enforcement measures, suggests that the Shire indeed exerts a degree of control over Cable Beach and also, to an extent, manages Cable Beach.

113 Evidence given to the Tribunal by officers of the Shire also supports the view that in the Cable Beach north area, the Shire undertakes activities by way of maintaining the beach area.

114 If the Parliament permits, as it has, a local government to charge a fee for providing the use of, or allowing admission to, property controlled, managed or maintained by the local government, and it is accepted - as I think it should - that a local government may effect control, management or maintenance of property without having any form of ownership of it (or proprietary interest in it), then I think it is possible to see s 6.16(2)(a) as itself the source of the power of a local government to provide the use of, or allow admission to, the property in question, and so to charge a fee in respect of providing the use of, or allowing admission to, that property.

115 In relation to a public beach in a remote part of Western Australia - or even for that matter in a more populous region of the State - where the Crown (or the State) - is the ultimate owner of the land, in circumstances where the local government has made local laws by which it seeks to control activities on such land, and where the local government administers and enforces the local laws in relation to such areas, there may be no other proper authority with a relevant practical interest in controlling, managing or maintaining the property in question in the public interest. In those circumstances, one can see a proper basis for interpreting s 6.16(2)(a) as giving the local government the power to provide the use of, or allow admission to, the property and imposing a fee or charge in respect of such use or admission.

116 While it is not necessary for me to decide this question for the reasons given earlier, I am inclined to the view that it is open to a local government to impose a fee providing for the use of, or allowing admission to, property such as Cable Beach, both within the Reserve and VCL area to the north of the Reserve.

117 While s 6.16(2)(d) makes express provision for a fee to be imposed for receiving an application for approval, granting an approval, making an inspection and "issuing a licence", I do not think that this power necessarily precludes a local government, in an appropriate case, from imposing a fee under s 6.16(2)(a) which is truly imposed for providing the use of, or allowing admission to, property controlled, managed or maintained by the local government. Not all licences will necessarily relate to property referred to in s 6.16(2)(a).

118 Section 6.16(2)(d) is designed to enable a fee to be charged for the physical act of issuing the licence where nothing more is required of the local government than to receive the application for approval, grant an approval, make any necessary inspection and then physically issue a formal authorisation. Where, however, the giving of a formal authorisation additionally involves the local government providing the use of, or allowing admission to, property that it wholly or partly controls, manages or maintains, then I think it may well be entitled to impose a separate fee under s 6.16(2)(a) that bears a proper relationship to the "use" or "admission" provided for.

119 A difficulty in the present case, however, is that, at all material times, the Council has proceeded on the basis that it is entitled to impose a "licence fee". That is redolent of the sort of licence fee that is imposed under s 6.16(2)(d), not the use or admission fee contemplated by s 6.16(2)(a).

120 Plainly there has been some confusion in the mind of the Shire as to what sort of fee it is intending to impose in this case. Undoubtedly, it is open to the Shire to impose an application fee and a licence fee pursuant to s 6.16(2)(d) for the purposes of the Trading Local Law. Additionally, it is reasonable to contend that it is also open to the Shire to impose a separate fee, in an appropriate case, that applies for providing the use of or allowing admission to property controlled, managed or maintained by the local government. In other words, there might be two separate fee regimes.

121 However, as I have made clear, it is not necessary for me to express a concluded view about this in order to rule on the primary issues in this case. This is because, even if the approach arguably available is open to the local government, it is by no means clear that this is the approach that has been adopted by the Shire to date. Rather, the process has involved a mish-mash of licensing regulation under the Trading Local Law, tendering as to price for the purpose of setting an "annual licence fee", the use of private law contractual licences, and the suggested use of s 6.16(2)(a) for "licence fee" setting purposes. At the same time, no fees have actually been imposed for the purposes of the Trading Local Law under s 6.16(2)(d); or under s 6.16(2)(a).

122 Further, even if the only question to arise in this case were whether the proposed "licence fee" to be paid by the second respondents could be justified under s 6.16(2)(a), the answer, in my view, is "no". The imposition of a fee under s 6.16(2)(a) that simply involves the adoption of a "price" that an applicant is prepared to pay for a "licence" is, in my view, invalid as it bears no proper relationship to the use or admission the subject of the proposed "licence". The Shire has made absolutely no assessment of what a proper fee should be.

• I consider the decisions of the Shire of 27 June 2006 to approve the applications of Red Sun Camels Pty Ltd and to refuse the applications for approval of the applicants, Mr and Mrs Bird and Mr Casley, to be reviewable decisions at the instance of these unsuccessful applicants, who I consider to be affected persons for the purposes of Pt 9, Div 1 of the Local Government Act 1995 (WA).

• I consider the decisions in question to be invalid essentially by reason of the fact that the Council made the decisions in the course of a decision-making process that impermissibly caused the Shire to abdicate its responsibility to set a licence fee payable to secure the issue of trading licences, in accordance with the requirements of s 6.16 of the Local Government Act 1995. To make the point quite clear, the Council itself must impose the licence fee for the purposes of the Trading Local Law and the Local Government Act 1995 by reference to the criteria to be found implicitly or expressly in the Local Government Act 1995. It is not entitled to treat a licence as property belonging to the Shire that it is at liberty to sell to the highest bidder.

124 As a consequence I would make the following final orders:

2. The decisions of the Shire of Broome made on 27 June 2006 to approve the trading licence applications of Red Sun Camels Pty Ltd and to refuse the trading licence applications of Alison Bird and Alan Bird and Abdul Casley, are set aside.

3. The matter of the determination of the applications be sent back to the Shire of Broome to permit the Council of the Shire to reconsider the applications for trading licences lodged as part of the invitation to tender process generally in accordance with the principles discussed in the reasons given orally on 15 November 2006. In particular, the applications should be reconsidered without regard to the weighted "Price-50%" factor applied pursuant to the Policy and the Selection Criteria and specification document. This means that the Council urgently needs to adopt a revised Policy and Selection Criteria and grant applicants the opportunity to address the relevant factors before a final decision is made by the Council. The Council will also need to set valid fees for both applications for trading licences (at least for the future) and for the issue of a trading licence that will apply after it decides which applications to approve in this case. The licence fee should be imposed as soon as possible to ensure applicants know what their fee obligation is before the Council determines the applications.

4. The parties have liberty to apply on short notice.

I certify that this and the preceding [124] paragraphs comprise the reasons for decision of the State Administrative Tribunal.

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JUSTICE M L BARKER, PRESIDENT