ETSA UTILITIES PTY LTD v CORP OF THE CITY OF UNLEY No. SCGRG-99-1070 [2000] SASC 74

On 23 August 1999 the Corporation of the City of Unley ("the Council") carried a resolution pursuant to s 303 of the Local Government Act 1934 declaring part of land owned by ETSA Utilities Pty Ltd ("ETSA") to be a public road. ETSA appealed against the resolution pursuant to s 303(5) of the Act. The issues in the appeal involve several issues of fact. The parties have identified two questions which, if decided in favour of ETSA, will determine the appeal in its favour. The facts necessary for the determination of those questions are in very narrow compass. An order was therefore made by consent to determine those questions as preliminary questions.

The questions are whether, on the true construction of s 303(4) and in the circumstances which have happened before passing the resolution to declare that part of ETSA's land to be a public road, the Council has complied with the requirements of s 303(4) that it give at least 14 days notice of its intention to do so and, if not, is the resolution valid? These two questions can be divided into four subsidiary questions. They are:

1. What is the meaning of the expression "at least" in s 303(4)?

4. If the Council failed to comply with s 303(4), is the resolution valid?

Section 303 invests a council with power to declare land to be a public street or road. Section 303 provides:

"303. (1) The council may, whether an application to the council is made pursuant to subsection (2) or not, subject to sections 304 and 305, by resolution declare any land in its area which comes under or is included in any of the following definitions or descriptions to be a public street or road: (a) any street or road of which there has been uninterrupted user by the public for at least ten years; (b) any land used as a street or road which has been wholly or partly formed, levelled, paved, or drained as a street or road by the council at the cost of the council or at the cost of the owners of ratable property abutting on the land, or partly at the cost of the council or the owners, and of which there has been uninterrupted user by the public as a street or road for five years consecutively either before or after the land was formed, levelled, paved, or drained; (c) any land used as a street or road, of which the owner in fee simple is unknown to the council and in respect of which all the owners of ratable property abutting on the land join in a request in writing to the council that the land be declared a public street or road; (d) any land laid out as a pathway or walkway for use by the public generally. (2) Any owner of any freehold interest in any such street or road or land as is described in subsection (1)(a) or (b), or the owner of any ratable property abutting on any such street or road or land may, by writing, request the council to declare the street or road or land to be a public street or road, and the council must consider the request. (3) If a request is made to the council pursuant to subsection (2) and after the expiration of 6 weeks after the receipt of the request the council has not passed a resolution declaring the street or road or land to be a public street or road, the person making the request may, within 14 days after the expiration of the period of 6 weeks, appeal to the Land and Valuation Court. There is no right of appeal pursuant to this subsection if the street or road or land is less than 12.2 metres in width. (4) Before passing a resolution pursuant to this section, the council must, if the owner of any freehold interest in the street or road or land is known to the council, give notice in writing to every such owner at least 14 days before the passing of the resolution. Any such owner may make any representations in writing to the council and these must be considered by the council. (5) After the passing of a resolution pursuant to this section, the council must, if the owner of any freehold interest in the street or road or land is known to the council, give to every such owner notice in writing of the passing of the resolution. Any such owner may within 14 days after the giving of notice appeal to the Land and Valuation Court from the resolution of the council."

The parties have agreed the facts relevant to the determination of the preliminary questions. They are:

1. ETSA is the proprietor of the land comprised and described in Certificate of Title Register Book Volume 5685 Folio 448 which title derives from Certificate of Title Register Book Volume 4231 Folio 871. An electricity substation is erected upon the land.

2. The Council is a corporation by virtue of the provisions of the Local Government Act 1934 and is responsible for the exercise and performance of the powers, functions and duties of local government conferred on it by the Act in relation to the area of the City of Unley.

3. On 27 April 1999 a motion at a meeting of the Council ("the motion") was moved in the following terms:

"That Council's Administration be authorised to proceed with the declaration of public road in Little Charles Street, Unley in accordance with section 303 of the Local Government Act."

4. By Notice of Intention to pass Resolution dated 9 August 1999, received by ETSA on 9 August 1999, the Council informed ETSA that consideration of the motion had been adjourned to the meeting of Council on 23 August 1999. The notice was in the following terms:

"TAKE NOTICE that pursuant to Section 303(1) of the Local Government Act ('the Act'), at the meeting of The Corporation of the City of Unley ('Council') on the 27th day of April 1999, a motion was moved in the following terms: 'That Council's Administration be authorised to proceed with the declaration of public road in Little Charles Street, Unley in accordance with Section 303 of the Local Government Act'. Consideration of that motion has been adjourned to the meeting of Council on Monday the 23rd day of August 1999 at Council Offices, 181 Unley Road, Unley. At that meeting it is proposed that the following motion be moved: 'That as a portion of the land contained in Certificate Title Register Book Volume 4231 Folio 874 being delineated as 'proposed public road' in the attached plan ('Land') is a road of which: (a) there has been uninterrupted use by the public for at least ten (10) years; (b) has been paved as a road by the City of Unley at the cost of the City of Unley and of which there has been uninterrupted use by the public as a road for at least five (5) years consecutively; and (c) is laid out as a pathway or walkway by the public generally, that pursuant to Section 303(1) of the Local Government Act, the Land be declared a public road'. This Notice is to provide you, as the registered proprietor of the Land, with notification of the Council's intention to pass the above resolution pursuant to Section 303(4) of the Act. DATED the 9 day of August 1999."

5. The Notice of Intention to pass Resolution was delivered to ETSA under cover of a letter from the Council dated 9 August 1999. The letter identified the land to be declared a public road as being portion of the land described in Certificate of Title Register Book Volume 4231 Folio 871 and marked as "proposed public road" on a plan enclosed with the letter. The plan was not enclosed with the letter. The letter was in these terms:

"It has come to the attention of the Corporation of the City of Unley ('Council') that a section of roadway in Little Charles Street, Unley is used as a public road but has not been proclaimed and gazetted as a public road. The land I refer to is a portion of the land contained in Certificate of Title Register Book Volume 4231 Folio 871 and marked as 'proposed public road' on the plan enclosed ('Land'), being land owned by the Electricity Trust of South Australia. The Land has been used as a road by the public for a period estimated to be in excess of 20 years. The area was in fact paved as a road by the Council some time ago. The Council have considered the issue and have now determined that it is appropriate that the Land be declared a public road. Accordingly, I enclose a notice pursuant to Section 303 of the Local Government Act. I understand that the Land has been vested in the Electricity Trust of South Australia Utilities by way of vesting order, although the vesting order yet to be registered against the certificate of title. Therefore I enclose a notice addressed to the Electricity Trust of South Australia and the Electricity Trust of South Australia Utilities. I invite you to contact me should you have any queries."

6. In a telephone conversation on 12 August 1999 ETSA asked the Council to supply a copy of the plan.

7. On 13 August 1999, ETSA received a copy of the plan under cover of a letter from the Council dated 13 August 1999.

8. On 23 August 1999 the Council passed the following resolution ("the resolution"):

"That as a portion of the land contained in Certificate of Title Register Book Volume 4231 Folio 871 being delineated as 'proposed public road' in the attached plan ('Land') is a road which: (a) there has been uninterrupted use by the public for at least ten (10) years (b) has been paved as a road by the City of Unley at the cost of the City of Unley and of which there has been uninterrupted use by the public as a road for at least five (5) years consecutively; and (c) is laid out as a pathway or walkway by the public generally; that pursuant to section 303(1) of the Local Government Act 1934, the Land be declared a public road".

9. ETSA did not make any representation to the Council as to its attitude on the proposed resolution prior to 23 August 1999 nor did ETSA ask the Council to defer its consideration of the proposed resolution.

10. On 25 August 1999 ETSA received a Notice of Passing of Resolution by which the Council gave ETSA notice of the passing of the resolution.

11. The first contact made by ETSA with the Council after receipt of the Notice of Passing of Resolution was on 27 August 1999 when ETSA's real estate officer Teresa Sergi telephoned the Council to express concern in respect of the receipt of the Notice. She was told that concern needed to be put in writing. She enquired as to whom correspondence ought to be addressed.

12. On 30 August 1999 ETSA sent the Council a letter dated 30 August 1999 by facsimile transmission in which ETSA expressed serious concerns regarding the Notice of Passing of Resolution. The letter stated the grounds for those concerns.

13. On 31 August 1999 ETSA instructed its solicitors to institute this appeal.

ETSA submits that the Council's failure to include in the letter dated 9 August the plan of the land to be declared a public road or its failure to attach the plan to the notice had the consequence that the Council did not give notice until 13 August. Alternatively, it submits that notice was not given until 9 August at the earliest. On either view, it says the Council has failed to give notice in the manner required by s 303(4) so that the resolution of 23 August is invalid.

The first question is what is meant by the requirement in s 303(4) that the Council give notice "at least 14 days before the passing of the resolution". Legislation which requires an act to be done "not later than" or "at least" or "not less than" so many days before a given event means that the act must be done so many clear days before that event: Forster v Jododex Australia Pty Ltd [1972] HCA 61; (1972) 127 CLR 421 per Gibbs J (with whom Walsh J agreed) at 445 - 447 and the cases there cited. Although Walsh and Gibbs JJ dissented in the ultimate result, the other members of the court agreed that the expressions noted above required the specified number of clear days to elapse before the event: see Stephen J at 448 and Mason J at 451. The provisions of s 27(1) of the Acts Interpretation Act 1915 have no application in this context. That section deals with a different situation, namely, where time is prescribed or allowed for doing anything. That is not the effect of s 303(4): Forster v Jododex Australia Pty Ltd per Gibbs J at 446 - 447. See also Francis v Carmichael [1976] VicRp 20; [1976] VR 259 at 263.

The use of the expression "at least 14 days before the passing of the resolution", therefore, required the Council to give 14 clear days notice. That period of time will be measured from the day after the notice is given. The letter enclosing the notice of the intended resolution to declare part of ETSA's land a public road was delivered to ETSA on 9 August 1999. The computation of the period of 14 days began on 10 August. Thus, the earliest date on which the resolution could have been carried by the Council was 24 August 1999. On this footing, the Council carried its resolution on 23 August 1999, one day earlier than it was permitted to do so. But ETSA says that notice was not in fact given on 9 August. I turn to that issue.

The letter delivered to ETSA on 9 August included a copy of the resolution carried on 27 April. Both the letter dated 9 August 1999 and the intended resolution stated that a portion only of the land owned by ETSA was to be declared a public road and both identified that portion by reference to a plan. Although the letter said that the plan was enclosed in the letter, it was not. Nor was the plan attached to the notice. Neither the letter nor the resolution provided any measurements or any other description by which ETSA could identify the portion of the land to which the Council referred. The letter stated that the land had been used as a public road and had been paved as a public road by the Council "some time ago". There was, however, nothing by which ETSA could identify the precise metes and bounds of the intended public road. On 12 August 1999 ETSA asked for a copy of the plan and the plan was delivered by the Council on 13 August. ETSA submits that the Council did not give notice for the purpose of s 303(4) until it delivered the plan to it.

Where a Council intends to declare that portion of a parcel of land be declared a public street or road, it is important that the Council specify accurately, and with sufficient particularity, that portion intended to be the subject of the resolution. That might be done in more than one way. The Council might in its notice specify the relevant measurements, or it might attach a plan, or it might do both. In this case, the Council thought it appropriate to enclose a plan. ETSA contends that the failure to include the plan deprived it of a critical part of the notice. I agree. Without the plan ETSA did not know how much land was intended to be the subject of the resolution. Although the letter of 9 August 1999 said that it was an area paved as a road, ETSA did not know whether a smaller or lesser area than the paved area was involved. (There is no evidence as to the extent of paving on ETSA's land.) The notice must clearly spell out what is intended. If it does not, the owner of the relevant parcel is at a disadvantage when preparing the representations to make to Council: cf. Scurr v Brisbane City Council [1973] HCA 39; (1973) 133 CLR 242 per Stephen J at 252. More significantly, in this particular case, the plan was incorporated by express reference in the intended resolution and in the letter. Failure to include the plan meant that ETSA did not know what portion of its land was being acquired. That failure had the consequence that the notice was incomplete. For these reasons, notice in accordance with s 303(4) was not given until 13 August so that the computation of the 14 clear days required by s 303(4) commenced on 14 August. The Council could not, therefore, pass the resolution until 29 August.

The Council has, therefore, failed to give notice in accordance with the requirements of s 303(4). Notice was not given until 13 August 1999. If that conclusion is wrong, notice was not given until 9 August. On either view the Council failed to give 14 clear days notice before carrying its resolution. What are the consequences of non-compliance?

The obligation of the Council in s 303(4) to give notice is expressed in terms which are mandatory. The "Council must ... give notice in writing ... at least 14 clear days". On a number of occasions s 303 uses language which distinguishes between that which must be done and that which may be done. It does so in s 303(4). It is reasonable, therefore, to conclude that the obligation to give notice is mandatory: Grunwick Processing Laboratories Ltd v Advisory Conciliation and Arbitration Service [1978] AC 655, at 690, 698. But the use of mandatory language does not necessarily mean that invalidity is the consequence of a failure to comply with the statutory requirement as to notice. The use of what has been called "the elusive distinction between mandatory and directory requirements" and the division of directory acts into those which have substantially complied with the statutory command and those which have not has been criticised as having outlived their usefulness: Tasker v Fullwood [1978] 1 NSWLR 20 at 23 - 24; Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 390. A better test for determining the issue of validity is to ask whether it was a purpose of the legislation that an act done in breach of the provisions should be invalid: Project Blue Sky Inc at 390. Further assistance is to be gained by considering whether the notice is an essential preliminary for the exercise of the statutory power or whether it is but a procedural condition: see Project Blue Sky Inc at 389.

There are at least three purposes of s 303(4). The first is to inform the owner of the relevant parcel of land (if the owner is known to the Council) of the Council's intention to declare part or all of the land to be a public street or road. The second is to give the owner an opportunity to make representations to the Council. The third is to require the Council to consider the representations made by the owner. Section 303(4) is a provision which gives statutory effect to the common law principles of procedural fairness which, in the absence of statutory provision to the contrary, apply whenever it is proposed to make a decision or order which will affect an individual's interest in land. In those circumstances a person affected is entitled to notice of the intention to affect his interest in the land, an opportunity to make representations, and reasonable notice of the hearing so that he may prepare his representations: Cooper v Wandsworth Board of Works [1863] EngR 424; (1863) 14 CBNS 180, 143 ER 414; Kioa v West [1985] HCA 81; (1985) 159 CLR 550 per Mason J at 582. Not only must notice be given but the Act requires that at least 14 days notice be given. It can therefore be inferred that the Act contemplates that 14 clear days is the minimum period which the person affected requires in order to be able to adequately prepare representations to the Council. Section 303(4) also requires the Council to consider the representations. These obligations are not mere procedural provisions. The obligation to give at least 14 days notice and the other obligations in s 303(4) are conditions precedent to the exercise of the power to carry a resolution declaring land to be a public street or road in the same way as the descriptions in s 303(1) are conditions precedent to the exercise of that power: cf. Jolly v District Council of Yorketown [1968] HCA 55; (1968) 119 CLR 347. In other words, just as the Council's resolution will be valid only if one or more of the descriptions in s 303(1) are satisfied, so too the resolution will be valid only if the Council complies with the requirements of s 303(4). The nature and importance of the requirements as to notice lead to the conclusion they are conditions precedent: Sandvik v The Commonwealth (1989) 89 ALR 213 at 228. Finally, the provisions in s 303(4) are included for the benefit of the owner of the land: cf. Kitto J in Jolly v District Council of Yorketown at 351. Thus, if notice is not given, or if there is less than 14 clear days notice, or if the Council does not consider the representations made to it, the Council cannot carry the resolution. For those reasons, I think that the statutory intention is that a failure to comply with the requirements of s 303(4) has the consequence that the resolution is invalid.

There is at least one further reason for this conclusion. If a council carries a resolution pursuant to s 303(1) declaring land to be a public street or road and there is no appeal or, on appeal, the Land and Valuation Court upholds the resolution, the land vests in the council in fee simple. In other words, the consequence is that the land is compulsorily taken from the owner without compensation. Curiously, compensation will only be paid in those instances where notice should have been given to the owner but was not: see s 305(6) and (7). The consequences for the owner of a resolution carried pursuant to s 303(1) are, therefore, extremely serious in those instances where the council has given notice under s 303(4). The fact that s 303 enables the compulsory acquisition of land without compensation except in the circumstances provided in s 305(6) reinforces the conclusion that a failure to comply with s 303(4) renders the resolution invalid. The circumstances of this case are quite unlike those in Montreal Street Railway Co v Normandin [1917] UKPC 2; [1917] AC 170 mentioned below. See also SS Constructions Pty Ltd v Ventura Motors Pty Ltd [1964] VicRp 32; [1964] VR 229 at 239.

This is one of those instances where, because of the mandatory nature of the language and the consequences to the individual of a resolution declaring land to be a public road, strict compliance is necessary and failure to comply results in invalidity of the resolution. Section 303(4) imposes a very simple obligation as to notice, an obligation with which a council can readily comply. The council is the moving party. It has complete control over the process and is able to ensure compliance. The ability to comply is wholly within the control of the relevant council. In this case, once it had realised it had not included the plan in its letter, the Council could have resolved to extend the period of notice. Even 13 days notice will, therefore, result in invalidity.

Mr Hayes QC, who appeared for the Council, submitted that I should have regard to the decision of the Full Court in Happy Valley Shopping Centre Pty Ltd v District Council of Meadows (1981) 27 SASR 117 and, in particular, to the observations of Zelling J at 128 - 130. But that case is clearly to be distinguished. The decision in Happy Valley concerned the duty of a council to give public notice of a proposed development plan for its area and the statutory obligation that a copy of the proposal shall be available for public inspection for not less than two months from the date on which public notice was given. The District Council gave public notice on 18 October 1979 that the plan would be open for inspection until 18 December 1979. The amendments were adopted and the amended plan came into operation. It was held that the statutory requirements were directory and not mandatory, so that the fact two clear months notice had not been given did not invalidate the statutory procedures and the amendment to the development plan. Zelling J applied the decision in Montreal Street Railway Company v Normandin [1917] UKPC 2; [1917] AC 170 and had regard to the general public inconvenience of invalidating the development plan. In Normandin the advice of the Privy Council was in these terms (at 175):

"When the provisions of a statute relate to the performance of a public duty and the case is such that to hold null and void acts done in neglect of this duty would work serious general inconvenience, or injustice to persons who have no control over those entrusted with the duty, and at the same time would not promote the main object of the Legislature, it has been the practice to hold such provisions to be directory only, the neglect of them, though punishable, not affecting the validity of the acts done."

The instant case is altogether different. First, s 303(4) requires notice, not to the public, but to an identified owner of land whose interest will be affected if the intended resolution is carried. Secondly, as already mentioned, the Council has complete control over the process and is able to ensure compliance. Thirdly, if the resolution is held to be invalid it will not cause any general inconvenience to the public or injustice to those who have no control over the Council which is entrusted to comply with the requirements of s 303(4). The public is not in any respect affected as the resolution cannot be operative until the appeal has been heard and determined. The consequences of invalidity, therefore, essentially affect only the Council and the owner of the land.

Mr Hayes QC also submitted that the non-compliance does not result in invalidity because s 303(5) provides a right of appeal. Thus, he said, a failure to comply with s 303(4) did not mean that an owner who appealed would be deprived of his land. The argument must fail. As already mentioned, s 303(4) specifies requirements which are conditions precedent to the carriage of the resolution. The owner is entitled to insist upon strict compliance with those conditions precedent. The owner should not have to undergo an appeal on factual issues if notice has not been given as required by the Act. Furthermore, in the case of an owner who did not appeal within time, the resolution would take effect.

Mr Hayes also sought to gain some assistance from the fact that s 305(6) envisages that compensation will be payable when no notice is given. The argument is misconceived. The fact that an owner of land will have his land taken compulsorily without compensation would cause the court to be zealous to ensure that a Council strictly complies with the requirements of s 303(4).

Finally, Mr Hayes QC relied on the decision in City of Port Adelaide Enfield v Minister for Transport and Urban Planning [1999] SASC 73; (1999) 73 SASR 22 at 30. Although the statutory requirements in that case were expressed in unambiguously mandatory language, it is apparent that the scheme of the regulations in that case did not require strict compliance because the statutory scheme allowed for the relevant planning authority to call for further information. The statutory scheme is quite unlike that in s 303 which provides no means of remedying any failure to give notice other than by ensuring that the Council meeting is held at least 14 days after the notice.

For all of these reasons, I decide that the Council has failed to comply with the requirements of s 303(4) and that the resolution made by the Council on 23 August 1999 is invalid. It follows that the appeal by ETSA must be allowed and the resolution of the Council set aside.