First Plaintiff v Defendant

(a) The defendant ('the Association') be restrained from instructing the Victorian Electoral Commission to distribute ballot papers in the Municipal Association of Victoria Board elections unless the ballot papers include the name of the second plaintiff as a candidate.

(b) The Association be restrained from preventing the second plaintiff from attending and taking part as a nominee in the Presidential candidate forums for the Municipal Association of Victoria Board elections on 14, 15 and 16 February 2017.

(c) A declaration that the Second Plaintiff ('Ross') was validly appointed as the representative of Darebin City Council to the Association.

2 The defendant was established as a voluntary unincorporated association in 1879 for the purpose of promoting the efficient carrying out of municipal government throughout the State of Victoria and of watching over and protecting the interests, rights and privileges of municipal corporations other purposes.

3 The Association was incorporated by the Municipal Association Act 1907 ('the Act') and s 2 of the Act, as originally enacted, provided in part that 'the council of each municipality in Victoria from time to time may appoint a councillor to be the representative of such council and the representative so appointed shall constitute the Association'.

4 In 1989, s 2 of the Act was amended and subsection (2) provides as follows:

Each council in Victoria from time to time may appoint a councillor to be the representative of such council and the representatives so appointed shall constitute the Association.

5 Ross is a councillor of the City of Boroondara and has been the councillor appointed by the City of Boroondara to be its representative on the Association since November 2008.

6 Since March 2011, she has been on the Association Board and she was elected as Deputy President Metro in April 2015. In November 2016, she was elected as Interim President of the Association.

7 On 12 December 2016, the Council of the City of Boroondara passed a motion that it would not appoint a delegate to the Association for the council year 2016/2017 although it continues to pay its fees and to be a member of the Association.

8 On 30 January 2017, the Darebin City Council resolved to nominate Ross as its delegate to the Association and, by letter dated 31 January 2017, the Acting Chief Executive Officer of Darebin City Council formally notified the Chief Executive Officer of the Association of the appointment.

9 By letter dated 3 February 2017 to the Acting Chief Executive Officer of Darebin City Council, the Chief Executive Officer of the Association stated that the Association had 'obtained legal advice to the effect that a Council is not permitted to appoint a councillor of another Council as its representative to the [Association]' and that the Board had earlier that day resolved as follows:

1. That the Board notes the advice of Mr Collinson QC in relation to the [Association] elections and accepts his advice that a member council cannot appoint a councillor from another Council as its [Association] delegate.
2. The Board accepts that the CEO is the Returning Officer and is empowered to decide whether to accept or reject an appointment for the purposes of an [Association] election.
3. That the Board resolves to notify all member councils of the legal advice received and the position adopted by the Board.

10 The plaintiffs submit that the Darebin City Council and Boroondara City Council are both city councils constituted under s 3B of the Local Government Act 1989 (Vic); and Ross is an elected councillor of the Boroondara City Council. Accordingly, on a literal reading of s 2, as a councillor, Ross was eligible to be appointed by any other council as the representative of such other council.

11 Further, it was submitted that reference to the Rules of the Association ('the Rules') supported their interpretation of s 2.

12 Under s 3(2) of the Act, the Association is empowered to make rules. Rule 6 presently provides:

6.1 A council which is a financial member of the Association must appoint a representative and a substitute representative of the council to the Association and must notify the Association in the form specified in Schedule 1 as soon as possible after the Council has made the appointment and, where an Election Day has been appointed by the Chief Executive Officer, no less than four weeks prior to that date.

6.2 Appointments must be made by resolution of council.

6.3 The Council from which the President is elected must appoint an additional representative to vote on matters under consideration by the State Council.

13 Section 2 of the Rules also defines both representative and councillor as follows:

'Representative' means a councillor and includes, in the absence of the representative of the council at a meeting, the substitute representative of that council who exercises a vote on any matter as if he or she were the representative of the council.

'Councillor' means a person who holds the office of member of Council; and includes a person appointed by Order in Council under section 219 or section 220R of the Local Government Act 1989.

14 Section 6(2) of the previous Rules introduced in 2004 (but subsequently amended to their present form in 2013) specifically provided that '[a] representative of the council must be a person who is a councillor of the council making the appointment'.

15 Accordingly, it was submitted that the amendment of the Rules represented a deliberate choice to do away with the requirement that a councillor must be a councillor of the appointing council and was consistent with the literal interpretation of s 2 of the Act.

16 In oral submissions, the plaintiffs relied on the expanded content of the Act and the decision of Habersberger J in Municipal Association of Victoria v Victorian Civil and Administrative Tribunal[1] and submitted that the obligations of being a representative on the Association, are not simply an extension of being a councillor.

17 The plaintiffs submitted that the functions of the Association are quite different to the functions of local councils; and the interests of the Association or of local government in Victoria in general are quite different from the interests of the constituents of a particular council or of any particular council. The interests of the council would be best served by having the most qualified representatives appointed to the Association, which was a good reason why councils should not be limited to nominating its own councillors to the Association to represent the interests of councils across Victoria.

18 The plaintiffs argued that their construction was more plausible because it 'acknowledges the reality that local councils are concerned with parochial questions, whereas the Association is not concerned with parochial questions'.

19 Further, s 3 of the Act affords the Association power to make rules, as long as they are not inconsistent with the legislation, or any other law; and it has made those rules. The plaintiffs argued that, as the broader construction is open on the text of s 2(2), and as s 3 provides that the rules may further regulate the management of the association, the broader construction should be preferred to enable the Association to regulate the manner in which appointments are made.

20 The defendant contended that, under s 2(2) of the Act, a council was only entitled to appoint a councillor from that council to be a representative of the council.

21 The defendant argued that the ordinary and grammatical sense of the words supported its construction. It was the juxtaposition of the words 'council' and 'councillor' that convey that the councillor referred to is a councillor of the appointing council.

22 Section 35 of the Interpretation of Legislation Act 1984 (Vic) requires an interpretation which promotes the purpose or object of the Act. The defendant submitted that the appointment of a councillor from the appointing council would better promote the purpose of the Act for the following reasons:

(a) A councillor of the council would be more suitably qualified to represent the community's interest on the Association and would better promote the interest, rights and privileges of that council.

(b) Councillors have an obligation to serve the best interests of the local community and avoid conflicts of interest. The appointment of a councillor from one council representing the interests of another council on the Association would inherently involve potential conflicts of interest.

23 In response to the plaintiffs' contention recorded in [19] above, the defendant submitted s 3 could not authorise the Association to regulate the persons who were eligible to be appointed to the Association. Further, the Rules could not be used as an aid to the interpretation of the Act.[2]

24 The primary object of statutory construction is to construe the relevant provisions so that its legal meaning is consistent with the language and purpose of all of the provisions of the statute.[3] The legal meaning is 'the meaning that the legislature is taken to have intended [the provision] to have'.[4]

25 The Court of Appeal recently considered the principles of statutory construction in Colonial Range Pty Ltd v CES-Queen (Vic) Pty Ltd.[5] I summarise the approach adopted by the Court of Appeal as follows:

(a) First the Court considers the text of the relevant provision in its context, which includes the whole of the instrument, the existing state of the law and the legislative history.

(b) To identify the legislative purpose, consideration may be given to extrinsic material, such as parliamentary debates, only after 'exhausting the application of the ordinary rules of statutory construction'.[6] However, extrinsic material 'cannot displace the clear meaning of the text'.[7]

(c) If the literal or grammatical[8] ('the literal') meaning of the text is consistent with the legislative purpose, the literal meaning will be accepted as the legal meaning.

(d) A construction that promotes the purpose of the Act is to be preferred to a construction that does not.[9]

26 An issue may arise if the literal meaning conflicts with the legislative purpose. The resultant tension was described by Francis Bennion in 'Statutory Interpretation' as follows:

Consideration of the enactment in its context may raise factors that pull in different ways. For example the desirability of applying the clear literal meaning may conflict with the fact that this does not remedy the mischief that Parliament intended to deal with.[10]

27 If the inconsistency between the literal meaning and the legislative purpose is the result of 'simple, grammatical, drafting errors which if uncorrected would defeat the object of the provision', an alternative construction, which is consistent with the legislative purpose, may be more 'readily' adopted.[11]

28 In other circumstances, in ascertaining the legal meaning it is '[t]he context of the words, the consequences of a literal or grammatical construction, the purpose of the statute or the canons of construction [that] may require the words of a legislative provision to be read in a way that does not correspond with the literal or grammatical meaning' ('an alternative construction').[12]

29 The determination of whether the legal meaning is the literal meaning or an alternative construction that better promotes the legislative purpose '[q]uite obviously [gives rise to] questions of degree'.[13]

30 In Colonial Range Pty Ltd v CES-Queen (Vic) Pty Ltd,[14] the Court of Appeal recognised competing considerations as being:

(a) On one hand, '[r]ecent statements of the High Court have emphasised the primacy of the text in the resolution of any perceived tension between the text and the legislative purpose of the Act'.[15]

(b) On the other hand, instances of inconsistencies, which may justify a departure from the literal meaning, were as follows:

(i) the literal meaning would conflict with other provisions of the statute;

(ii) the literal meaning is inconsistent with the purposes of the statute;

(iii) the literal meaning is incapable of practical application; or

(iv) adoption of the literal meaning would lead to a result which is absurd, unreasonable or anomalous.[16]

31 Because 'the task remains the construction of the words the legislature has enacted', if an alternative construction is to be adopted as the legal meaning, it is necessary that such a construction is 'reasonably open'[17] and 'consistent with the language in fact used by the legislature'.[18]

32 Assuming that the Court finds an alternative construction is reasonably open and consistent with the language used in the provision, the legal meaning will be determined by balancing:

(a) the strength of the literal meaning as against the alternative construction: and

(b) the extent to which these meanings are consistent with the promotion of the legislative purpose.

33 This balancing exercise has been explained by High Court as follows:

(a) 'If the choice is between two strongly competing interpretations, as we have said, the advantage may lie with that which produces the fairer and more convenient operation so long as it conforms to the legislative intention. If, however, one interpretation has a powerful advantage in ordinary meaning and grammatical sense, it will only be displaced if its operation is perceived to be unintended.'[19]

(b) '[I]nconvenience or improbability of result may assist the court in preferring to the literal meaning an alternative construction which, by the steps identified above, is reasonably open and more closely conforms to the legislative intent'.[20]

(c) An alternative construction will be rejected as the legal meaning if it fills 'gaps disclosed in legislation' or makes an insertion which is 'too big, or too much at variance with the language in fact used by the legislature'.[21]

34 On one view, the literal meaning of s 2 is unambiguous. It provides that each council may appoint 'a councillor'; and the definition of a councillor is not in dispute.[22] However, I consider that the adoption of this approach to interpreting the section would be similar to ascertaining the meaning of a 'compound expression' by reference to its 'disintegrated parts'.[23]

35 Determining the literal meaning of a sentence by ascertaining the definition of each word of the sentence without reference to the context was eschewed by Lord Hoffman in R v Brown[24] who stated that it was common fallacy among lawyers:

[T]o treat the words of an English sentence as building blocks whose meaning cannot be affected by the rest of the sentence. ... This is not the way language works. The unit of communication by means of language is the sentence and not the parts of which it is composed. The significance of individual words is affected by other words and the syntax of the whole.[25]

36 If one does not determine whether a provision is ambiguous by the strict literal approach, how is it to be done? The word ambiguity is 'ironically a word not without its own difficulties'.[26] However, I adopt the meaning suggested by Priestley JA in Burns Philp Hardware v Howard Chia Pty Ltd[27] that an ambiguous provision has 'two or more plausible meanings when the context of the words in the document is taken into account in light of the knowledge any ordinarily intelligent reader of the document would bring to the reading of it'.[28]

37 An inherently ambiguous term may not be ambiguous when read in its context;[29] but, equally, an unambiguous term may be ambiguous when read in the context of the provision in which it appears. In my opinion, the present case falls into the latter category. If the section provided for each council to appoint an Australian lawyer, it may have been legally unambiguous. However, the fact that the section provides for a 'council' to appoint a 'councillor' to represent 'such council' would suggest to an 'ordinarily intelligent reader' that the legislature may have intended that the councillor was a member of the appointing council ('the narrow construction'). In fact, given the juxtaposition of these words, I consider that the narrow construction may be preferred by an ordinarily intelligent reader.

38 Accepting, as the parties do, that s 2 is ambiguous, the construction that promotes the legislative purpose should be preferred. I consider that the parties' submissions as to why their respective constructions would lead to more effective representation of the appointing counsel are both plausible.

39 However, in my opinion, the compelling reason to infer that the legislature intended the narrow construction is as follows:

(a) The purposes of the Association stateda in the preamble to the Act include:

(i) the promotion of the efficient carrying out of municipal government in Victoria;

(ii) the protection of the interests rights and privileges of municipal corporations; and

(iii) the establishment and conduct a Municipal Officers Fidelity Guarantee Fund.

(b) The purpose of the section was for each council to have its interests represented on the Association.

(c) The appointment of a councillor from one council to represent the interests of another council on the Association would create a potential for a conflict of interests.

40 It is not apparent how a representative of a council could resolve a conflict which would arise if the interests of the council, of which he or she was a member, conflicted with the interests of the council, which he or she represented on the Association. Examples are not difficult to anticipate. The Association is empowered under s 5 of the Act to contribute to the Fidelity Guarantee Fund. It could be expected that the manner in which contributions are calculated would impact differently on councils. For example, it would be in the interests of different councils for the contributions to be calculated by reference to municipal population, employee numbers or total revenue.

41 Although the provisions in Part 4 of Division 1A of the Local Government Act 1989 (Vic)[30] were not enacted at the time of the enactment of the Act in 1907, I consider it very improbable that the legislature would have intended to adopt a regime that would so readily have placed councillors to act in conflict with the interests of the councils to which they had been elected.

(a) The meaning of 'a councillor' read in its context is ambiguous in that both the broad and the narrow constructions are reasonably open and consistent with the language used in the provision.

(b) It is improbable that the legislature intended that a council could appoint, as its representative on the Association, a councillor of another municipality with the consequent creation of potential conflicts of interests.

(c) The narrow construction, limiting a council to appointing one of its own councillors, more closely conforms to and promotes the legislative intent of ensuring the interests of each council are properly represented on the Association.

43 Accordingly, the legal meaning of s 2 of the Act is that each council may appoint a councillor from its council to represent such council on the Association. I propose to dismiss the motion.

[1] [2004] VSC 146. His Honour noted at [12] that 'as a result of amendments to the [Municipal Association Act 1907 (Vic)] over the intervening 97 years, [the Association's] functions have broadened'.

[2] See Hunter Resources Ltd v Melville [1988] HCA 5; (1988) 164 CLR 234, 244 (Mason CJ and Gaudron J).

[3] Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355, 381-2 [69] (McHugh, Gummow, Kirby and Hayne JJ).

[5] [2016] VSCA 328 [47]-[55] (Warren CJ, Whelan JA and Riordan AJA).

[6] Saeed v Minister for Immigration & Citizenship [2010] HCA 23; (2010) 241 CLR 252, 265 [33] (French CJ, Gummow,

Hayne, Crennan and Kiefel JJ); quoted in Di Paolo v Salta Constructions Pty Ltd [2015] VSCA 230

[7] Northern Territory v Collins [2008] HCA 49; (2008) 235 CLR 619, 642 [99] (Crennan J).

[8] In Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355, McHugh, Gummow, Kirby and Hayne JJ appear to refer to the 'literal meaning', 'the literal and grammatical meaning' and 'the literal or grammatical meaning' interchangeably - see 382 [72], 384 [77], 384 [78], 385 [80].

[9] Interpretation of Legislation Act 1984 (Vic) s 35(a).

[10] Francis Bennion, Statutory Interpretation: A Code (Butterworths, 3rd ed, 1997) 343-4; referred to with approval in Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355, 384 [78] (McHugh, Gummow, Kirby and Hayne JJ).

[11] Taylor v Owners - Strata Plan No 11564 [2014] HCA 9; (2014) 253 CLR 531, 548 [38] (French CJ, Crennan and Bell JJ). The unique nature of the power to correct drafting errors was recognised in Inco Europe Ltd v First Choice Distribution (a firm) [2000] UKHL 15; [2000] 1 WLR 586. At 592, Lord Nicholls said 'It has long been established that the role of the courts in construing legislation is not confined to resolving ambiguities in statutory language. The court must be able to correct obvious drafting errors. In suitable cases, in discharging its interpretative function the court will add words, or omit words or substitute words. ... This power is confined to plain cases of drafting mistakes.'

[12] Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355, 384 [78] (McHugh, Gummow, Kirby and Hayne JJ).

[13] Cooper Brookes (Wollongong) Pty Ltd v Federal Commissioner of Taxation [1981] HCA 26; (1981) 147 CLR 297, 321 (Mason and Wilson JJ).

[14] [2016] VSCA 328 [47]-[55] (Warren CJ, Whelan JA and Riordan AJA).

[17] CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 348, 408 (Brennan CJ, Dawson, Toohey and Gummow JJ).

[18] Taylor v Owners - Strata Plan No 11564 [2014] HCA 9; (2014) 253 CLR 531, 549 [39] (French CJ, Crennan and Bell JJ). Although the Court was here referring to a modified meaning as one which added or omitted words, a fortiori, it must be a requirement whenever a court is to infer the legal meaning is other than a literal or grammatical meaning.

[19] Cooper Brookes (Wollongong) Pty Ltd v Federal Commissioner of Taxation [1981] HCA 26; (1981) 147 CLR 297, 321 (Mason and Wilson JJ).

[20] CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 348, 408 (Brennan CJ, Dawson, Toohey and Gummow JJ).

[21] Taylor v Owners - Strata Plan No 11564 [2014] HCA 9; (2014) 253 CLR 531, 548 [38] (French CJ, Crennan and Bell JJ).

[22] It was accepted by the parties that 'councillor' was properly defined in s 1A of the Local Government Act 1989 (Vic) as meaning 'a person who holds the office of member of a Council'.

[23] An approach of which Dixon J disapproved in R v Wilson; Ex parte Kisch [1934] HCA 63; (1934) 52 CLR 234, 244 (Rich, Evatt, and McTiernan JJ agreeing; Starke J dissenting). Dixon J said 'The rules of interpretation require us to take expressions in their context, and to construe them with proper regard to the subject matter with which the instrument deals and the objects it seeks to achieve, so as to arrive at the meaning attached to them by those who use them. To ascertain this meaning the compound expression must be taken and not its disintegrated parts.'

[24] [1996] 1 AC 543.

[25] Ibid 561. Cited with approval in Collector of Customs v Agfa-Gevaert Ltd [1996] HCA 36; (1996) 186 CLR 389, 397; XYZ v Commonwealth [2006] HCA 25; (2006) 227 CLR 532 at 592-3 [176] (Callinan and Heydon JJ); Harpur v Levy [2007] VSCA 128; (2007) 16 VR 587, 601 [60].

[26] South Sydney Council v Royal Botanic Gardens [1999] NSWCA 478, at [35] (Spigelman CJ).

[27] (1987) 8 NSWLR 642, 657.

[28] Ibid. Priestly JA actually defined ''not ambiguous' as 'not having two or more ...'.

[30] Sections 76B and 76BA oblige a councillor to act in the interests of the local community and to avoid conflicts of interests between his or her duty as a councillor and other obligations