Ku-ring-gai Council v Mr Garry West in his capacity as delegate of the Acting Director-General of the Office of Local Government & Ors

The Ku-ring-gai proceedings

1. Ku-ring-gai Council (the Council) commenced these proceedings, challenging its proposed amalgamation, in the Supreme Court on 22 March. On 13 April, Fullerton J ordered the transfer of the proceedings to this Court (Ku-ring-gai Council v Garry West as Acting Director-General of the Office of Local Government [2016] NSWSC 442).
2. These proceedings concern the specific amalgamation proposal that the Council be joined with Hornsby Shire Council to the extent of a significant portion of that latter Council's area but not the totality of it (as elements of the Hornsby local government area have already been severed and separately amalgamated into another new Council).
3. In these proceedings, by Notice to Produce dated 14 April 2006, the Council sought the production by the Department of Premier and Cabinet (the Department) and the Minister of a number of documents provided to the Government as a result of the work undertaken by KPMG.
4. Some documents have been provided to the Council and/or made available to it and to other councils (indeed, to the world at large) by publication on various Government websites.
5. However, in these proceedings, the Department filed a Notice of Motion on 29 April 2016 seeking to resist production of two of these documents, documents described as "Implementation of Local Government Mergers: Business Case" and "Options Analysis Local Government Reform".
6. On 27 May, when the motion on behalf of the Department seeking that the Department be excused from producing the two documents on the basis of public interest immunity, Dr J Lucy, counsel for all Defendants in these proceedings, sought and was granted leave (without objection from Mr Kennett, senior counsel for the Council) to file in court and rely upon an Amended Notice of Motion. The Amended Notice of Motion had the sole effect of pressing the same public interest immunity grounds on behalf of the Minister as had been pleaded in the original motion on behalf of the Department.

The evidence in the Ku-ring-gai access case

1. The evidence on behalf of the Department and the Minister was confined to an affidavit of Mr Paul Miller, General Counsel of the Department. This affidavit was read without objection. Although the affidavits of Mr Miller relied upon in the two earlier proceedings (discussed below - heard and determined by the Chief Judge) are not before me, it is reasonable to infer that, whether or not in identical terms, the import of the evidence from Mr Miller has been to the same affect in all three affidavits.
2. On behalf all the Council, Mr Kennett handed up a bundle of documents, three of which were tendered. Three tendered documents were:

• Local Government (City of Parramatta and Cumberland) Proclamation 2016 (Exhibit A);
• Media Release by the Minister dated 12 May 2016 entitled DELEGATE REPORT INDICATES BENEFITS IN A NEW KUR-ING-GAI HORNSBY COUNCIL (Exhibit B); and
• A letter from the Minister, dated 8 April 2016, addressed to Mr J O'Dea MP, Member for Davidson (Exhibit C).

1. It is unnecessary to refer to much of the detail contained in Exhibit A but it is appropriate to note that it is the document that it effects the excision of limited areas of the pre-existing Hornsby Shire local council area for them to be added to other amalgamated councils - with these areas having, by virtue of that Proclamation, had that excision given effect. The sole potentially relevant provision to be noted is that contained in cl 4(4) that has the effect of preserving the existence of Hornsby Shire Council (in its now modified form) as a potential amalgamation partner for the Council.
2. It is unnecessary to consider Exhibit B.
3. It will be necessary to address Exhibit C (the letter from the Minister to the Member for Davidson) in more detail as its terms are specifically relied upon as supporting a basis for permitting access to these two documents. That letter is in the following terms: Thank you for your email of 10 February 2016 making representations to the Premier on behalf of Mrs Cowley, President of Friends of Ku-ring-gai Environment about the KPMG report on proposed local council mergers. Your letter has been referred to me for reply. I have noted Mrs Cowley's request. I assure you that KPMG's analysis and modelling of the merger proposals is entirely contained within documents that are publicly available. The Local Government Reform Merger Impacts and Analysis document was prepared by KPMG on behalf of the NSW Government and provides an overview of the benefits of the proposals. The Technical Report outlines the assumptions made by KPMG when conducting its analysis and modelling. The outcome of the analysis and modelling, and further details on each merger proposal, are contained in the 35 individual proposal documents. These documents are available at www.councilboundaryreview.nsw.gov.au

Two earlier refusals of access

1. There have been two earlier decisions (both by Preston CJ) rejecting requests for access to these two documents (Walcha Council v Minister for Local Government [2016] NSWLEC 60 (Walcha) and Woollahra Municipal Council v Minister for Local Government [2016] NSWLEC 44 (Woollahra).
2. Although, in these two earlier cases, the Chief Judge has upheld claims for public interest immunity (for each of the two documents also involved in this motion) as warranting denial of production of them to the plaintiffs in those proceedings, in these proceedings comity does not mandate (nor, under the circumstances, permit) me simply to adopt in totality his Honour's reasoning processes and outcomes in Walcha or Woollahra. In part, some elements of his Honour's reasoning can be (and, with gratitude, are) adopted as they are self-evidently applicable.
3. However, in these proceedings, submissions have been made by Mr Kennett, written and oral, setting out the idiosyncratic bases why the Council says that disclosure should occur. It is necessary to deal with the Council's bases as to whether or not they, discreetly, provide a proper basis to override any established, prima facie proper basis for withholding the information.

The documents

1. The two documents sought here are "Implementation of Local Government Mergers: Business Case" and "Options Analysis Local Government Reform". They included the long form document described below.
2. As was described by Preston CJ in Walcha, at [2], a document entitled "Local Government Reform Merger Impacts and Analysis" was published by the New South Wales Government on 18 December 2015. As in the proceedings before his Honour, it is also the case that, in these proceedings, that document has been made available publicly and is available to the Council. However, as his Honour also noted: An earlier version of this document was annexed to a Cabinet submission that was submitted by the Minister for local Government to Cabinet. Mr Miller refers to that document as the long form document. The long form document was considered by Cabinet in its decision-making about local Government reform and Council mergers.
3. His Honour observed that the long form document was substantially longer than that which had been published in December 2015.

The decision-making matrix

1. In Woollahra, the Chief Judge succinctly set out the process required to be addressed in proceedings such as these. He said (at [7] and [8]): In determining whether or not to allow a claim of public interest immunity, the Court must balance the public interest in withholding the disclosure of information, or the production of a document, against the public interest in ensuring that courts performing the functions of justice should have access to relevant evidence. If, on balance, disclosure would be harmful, then it will not be permitted. A claim of public interest immunity gives rise to three steps. The first is that the harm that would flow from disclosure must be demonstrated. If that is demonstrated, the Court will initially incline against disclosure. Second, the need of the party seeking access must be identified and it must be shown that disclosure would be likely materially to assist that party's case in the litigation. Third, if the first two steps have identified matters to be weighed, the conflicting aspects of the public interest must be weighed.
2. I adopt this formulation of the process required to be followed in the Council's application.

The foundation for the orders sought

1. Dr Lucy submitted that orders sought are based on the provisions of ss 130 and 131A of the Evidence Act 2005 (NSW)(the Evidence Act) as they were sought on behalf of the Department and on behalf of the Minister in their capacities as Defendants in the proceedings.
2. On the other hand, the Council's written submissions, at (3), put that the immunity protection sought for the Minister arose from the common law.
3. As I understood the totality of the submissions on behalf of the Council and the Defendants, for these purposes there is no material difference between the processes arising under the Evidence Act and those under the common law.
4. These processes are as set out below in my adoption of the Chief Judge's description in Woollahra. It would be a distraction to explore that matter further, the outcome having no practical impact.
5. However, as one provisions of s 130 of the Evidence Act arises for specific consideration in addressing the matters raised the Council (it being s 130(5)(e)) it will be necessary to return to that specific provision later.

The public interest immunity arises but is challenged

1. The Chief Judge found, in both Woollahra and Walcha, that the two documents, as a consequence of their Cabinet use, satisfied the first step in the decision making matrix in that there is a public interest presumption against disclosure. In these proceedings, that is not disputed by the Council.
2. It is, therefore, necessary to examine in detail the bases why the Council says the evaluative process that follows from that should result in the setting aside of that presumption.

Reasons advanced for permitting access

1. I understood from the submissions made by Mr Kennett (both orally and in writing) that there were four grounds as to why access to these documents should be granted. In summary these were: 1. The documents had already been held out as being in the public domain and/or were, in fact, already in the public domain; 2. Inaccurate information relied upon by the First Defendant; 3. Absence of evidence because the First Defendant did not have access to the documents; and 4. The First Defendant's findings were manifestly unreasonable
2. Bases (2) to (4) arise from matters pleaded in the Council's Further Amended Summons discussed below.

Ku-ring-gai's Further Amended Summons

1. I had earlier granted leave to the Council, as part of my pre-trial procedural management of these and other council judicial review proceedings, to file, serve and rely upon a Further Amended Summons in these proceedings. That Further Amended Summons was filed on 27 May 2016 and two matters now incorporated in these further amendments are relied upon as providing bases for my assessment in the second step (as set out by Preston CJ in the above extract from Woollahra) and then, as the Council submits, when I progress to the third step, as outweighing the public interest immunity protection that would otherwise apply.

The basis for the inaccurate information claim

1. The first of these additional Grounds is Ground (7), pleaded in the following terms: The First Defendant failed to take into consideration a relevant matter, namely the financial advantages or disadvantages of the merger proposal.
2. The relevant particular, for my consideration in this public interest balancing act is that contained in (g), a particular pleaded in the following terms: Further and in the alternative, the First Defendant's factual findings in 9A(a) below were wrong and/or fundamentally flawed and/or based on inapplicable assumptions or outdated financial information, so that the First Defendant could not be said to have taken into account the financial advantage or disadvantage or the merger proposal.

The pleading of the no information claim

1. The Ground referred to in the above particular was pleaded under the heading "Failure to take into account relevant considerations". The Ground cross referenced, in particular (g), is pleaded under the heading "No evidence", with Ground 9A being pleaded as: The First Defendant made a finding in the absence of any evidence.
2. It is unnecessary to set out all of the matters contained in particular (a) but it is appropriate to set out particular (b) to this Ground as it is said to provide a basis for disclosure of the two documents. This particular, (b), is in the following terms: There was no evidence for those findings. The accounting evidence (if any) that would have supported the findings was contained in the KPMG documents which the delegate did not have.

The pleading of the manifestly unreasonable claim

1. Ground 9B in the Further Amended Summons was also relied upon as a basis for provision of access to the two documents. Ground 9B is pleaded as: In the alternative to 9A above, the First Defendant's findings were manifestly unreasonable.
2. The relevant particulars (there being two of them) are both designated as (a) in the document filed. The second (a) is relied upon, a particular in the following terms: Such conclusions were manifestly unreasonable either without or having regard to the analysis supporting the findings.

Some general principles

1. The Council's written submissions set out several sources of general principles applicable in such matters as here arise for consideration. It is appropriate to set out one of them, that in Murrumbidgee Ground-Water Preservation Association v Minister for Natural Resources [2003] NSWLEC 322 (Murrumbidgee), as it appears to contain a full yet concise summary of the matters to be considered. In this case, McClellan CJ wrote: 19 It is sufficient for present purposes to provide a summary of the relevant principles relating to public interest immunity. They seem to me to be as follows: 1. There is no absolute immunity from production and inspection of cabinet documents: Sankey at 43, 58-59, 95-96; Northern Land Council at 616. In this context "cabinet documents" extends to: (a) Cabinet minutes or other records of Cabinet discussions and records of discussions between heads of departments; (b) papers prepared as submissions to Cabinet; (c) any documents which relate to the framing of government policy at a high level Sankey at p 39. 2. The general rule is that a court will not order the production of a document although relevant and otherwise admissible if it would be injurious to the public interest to disclose it. 3. The public interest has two aspects: the protection of government from the harm which may be caused by disclosure and the interest in ensuring that justice can be effectively administered: Sankey at 38, Conway v Rimmer (1968) AC 910 at 940. 4. The court must weigh the competing elements of the public interest: Sankey at 43, 60-64, 98-99. 5. A claim for immunity for a class of documents as opposed to a claim in relation to individual documents will be upheld only if it is really necessary in the public interest or the proper functioning of the public service: Sankey at 39. 6. The court has power to inspect the documents in order to determine any claim. However, there remains some controversy as to the circumstances in which that power should be exercised. If the documents clearly fall into a class which attracts immunity they should not be inspected: Northern Land Council at p 617. 7. Documents recording the actual deliberations of cabinet are more likely to attract immunity than documents prepared outside Cabinet such as reports or submissions for the assistance of Cabinet: Northern Land Council at 614-615. 8. Documents relating to a topic which is current or controversial will attract a high level of confidentiality: Northern Land Council at 617-618. 9. Documents in relation to a matter which has passed into history attract a lesser level of confidentiality, as do documents which may have been already published. 10. The intended use of documents, particularly if required to found a defence to a criminal charge, is a relevant consideration. Where a person's liberty is at stake production is more likely to be ordered: Sankey at 42 and 61-62. 11. (a) It is unlikely that disclosure of the records of Cabinet deliberations upon current matters would be appropriate in civil proceedings: Northern Land Council at 618. (b) Documents and communications passing between a Minister and the head of his department relating to cabinet proceedings and material prepared for Cabinet are likely to be protected: at Sankey 99. (c) Reports relating to important matters of policy between public servants and Ministers or between senior public servants also warrant a high level of protection: at Sankey 99.
2. With the exception of Sankey (as it is adverted to later), I have omitted all the internally cited cases noted in this extract.

Consideration of Ground (1) - the public domain basis

1. I turn, first, to the question of whether or not the documents were in the public domain.
2. On this point, the Council relies on consideration of an element of s 130 of the Evidence Act. For this purpose it is necessary to note that s 130(5) sets out a non-exhaustive list of matters that are to be considered, in proceedings such as these, when undertaking the weighing process required by an application such as this. The relevant provision, s 130(5)(e) reads: Whether the substance of the information or document has already been published
3. In this context, the Council relies on the letter from the Minister to the Member for Davidson earlier set out, particularly the second and third paragraphs of that letter.
4. These paragraphs, as I understood Mr Kennett's submissions, constitute either an acknowledgement that either one or both documents have already been published or have been promised to be published.
5. Hence, he relies on the ninth of the matters summarised in Murrumbidgee: Documents in relation to a matter which is passed into history may attract a lesser level of confidentiality, as do documents which may have been already published. [Emphasis in Mr Kennett's written submissions]
6. On this point, the Council also relies on comments by Gibbs ACJ in Sankey v Whitlam [1978] HCA 43; 142 CLR 1 at [45] where his Honour observed that: Once a document has been published to the world at large, then no longer exists any reason to deny to the court access to that document, if it provides evidence that is relevant and otherwise admissible.
7. As the Council submitted, at (14) of the written submissions: Importantly for the present case, Gibbs ACJ went on to observe (at 45) that it may be that: If one document forming part of a series of cabinet papers has been published, but others have not, it would be unfair and unjust to produce one document without the rest; and where one document has been published it becomes necessary for the court to consider whether that circumstance strengthens the case for the disclosure of the connected documents.
8. It seems to me that the letter from the Minister to the Member for Davidson relied upon as evidencing existing disclosure of the documents or holding out that this would occur is a carefully crafted and confined document, a document written in circumstances of what has been and remains considerable public, political controversy concerning the Government's policy decisions relating to local council amalgamations.
9. The merits of that controversy are not ones with which this Court is engaged - this Court is confined to consideration of the validity of the processes undertaken by the Government to give effect to the policies that they have adopted concerning proposed amalgamations.
10. As I observed to Mr Kennett during the course of his submissions concerning this letter, it seemed to me that a proper reading of its terms makes it expressly clear that the documents available or held out to be available by the terms of that letter are expressly and completely confined to those available at the website for which the URL is given in the final paragraph of the letter.
11. Mr Kennett conceded that the documents that the Council seeks in these proceedings are not available at that website.
12. In light of that concession and the carefully crafted terms of the letter, I am satisfied that there is no prior disclosure basis (actual or promised) that can be said to provide support for release of these two documents in these proceedings.

Consideration of Ground (2) - inaccurate information relied upon by the First Defendant

1. This ground is founded on the Council's pleading in Ground 7 Particular (g) as earlier set out. The information pleaded as inaccurate is set out in Ground 9A Particular (a). It is unnecessary to set it out in detail.
2. The written submissions on behalf of the Council say, at (21), the following: Those findings are all referable to the connected documents of the Analysis and the Business Case; see Report pp 8, 14 and 17, Merger Proposal p 8. In order to make out Ground 7 in so far as it relies on particular (g) it will be necessary for the Plaintiff to show the conclusions in those documents were wrong, or based on inapplicable assumptions or out-dated information. That cannot be done without access to the documents and an opportunity to obtain expert evidence about their contents.
3. Although the Delegate's report and the Merger Proposal were in the bundle handed up on behalf of the Council, they were not tendered.
4. I have considered whether or not, as each of these documents is publicly available, I should have regard to their terms - although they were not in evidence before me. However, the material cited in (21) of the Council's written submissions makes it clear that the First Defendant's report was based on the "short form" document and that the documents for which access is sought were one step removed beyond the document relied upon.
5. Given the public interest nature of these proceedings (and in order to understand the Council's case for access to the contested documents at its highest), I have been to both of those documents as they have been published and put in the public domain by the Government.
6. To have me explore that "short form" document, taking yet a further step away from material in evidence in these proceedings would be, in my view, a step too far.
7. In this instance, it seems to me, although a matter of comparatively fine balance, that I am unable to conclude it would be necessary to go beyond the "short form" document, particularly in circumstances where it is not before me.
8. It will remain open to the Council to seek to demonstrate the basis set out in Ground 7 Particular (g) by reference to the short form document and such evidence as is adduced in the proceedings and submissions made with respect to it concerning that document.
9. Although the documents sought might assist the Council's case (taking its case for access at its highest), I am unable to conclude that it would, on the evidence before me (and my own small excursion beyond it), assist the Council's case. Thus this ground for access provides but faint support to the Council's quest.

Consideration of Ground (3) - the documents were not made available to the First Defendant

1. This ground is founded on the Council's pleading (Ground 9A(b)) concerning the absence of these documents being made available to the First Defendant for his consideration. Essentially the same proposition was also advanced in Walcha as a basis for making the documents available.
2. This was dealt with, succinctly, by the Chief Judge, at [15] to [17] of his Honour's decision. His Honour said: .. Amongst the grounds of challenge to the delegates' conduct is that the delegates were unable to examine the proposals that were informed or based upon KPMG material that was not published or publicly available, and presumably included the long form document and business case document that was produced for and considered by Cabinet. That claim also can be made without having access to the long form document or the business case document. The claim is that the delegates did not have access to and were unable to have access to those documents. All that needs to be proven is that the delegates did not have access to and were unable to gain access to those documents. This can be proved by, for example, reading parts of the affidavit of Mr Miller, as well as establishing the documents that were made available to the delegates and thereby proving the negative, that is, that the long form document and the business case document were not made available to the delegates. Of course, it is a separate matter to proof of a fact to show what the legal consequence is of not being able to have access to those documents, but establishing that legal consequence does not depend upon having access to the two documents that are subject to the public interest immunity claim. In the circumstances, I am not satisfied that the disclosure of the two documents would be likely to materially assist the applicants' case as pleaded.
3. The submissions for the Council in these proceedings provide no basis requiring addition to his Honour's reasoning and conclusion. I adopt his Honour's conclusion.
4. It follows that I am satisfied that failure to disclosure these two documents to the First Defendant is not a basis that can provide support for release of these documents in these proceedings.

Consideration of Ground (4) - the First Defendant's findings were manifestly unreasonable

1. Ground 9B of the Council's pleadings is put in the alternative to 9A, a ground considered above. For the purposes of seeking access to these documents, the Council relies on the second of the particulars pleaded to this Ground. Although earlier set out, it warrants repetition for this analysis. The particular is in the following terms: Such conclusions were manifestly unreasonable either without or having regard to the analysis supporting the findings.
2. The basis pressed by the Council as a reason for access to the documents, as worded in this particular, is dealt with in (23) of the Council's written submissions. This paragraph of the written submissions dealt with the totality of ground 9B and did so in the following terms: The first limb of Ground 9B criticises the Delegate for making findings without having looked at the Analysis and the Business Case. It does not require the documents in order to be made out (although that might change if the Defendants sought to argue that obtaining the documents would not have made any difference). However, the second limb (that the findings were unreasonable "having regard to the analysis") also cannot be made good without access to the contents of the documents.
3. This pleading, it seems to me, as to its second element, amounts to little more than a "fishing expedition" and, to the extent that it might be regarded as being a little more than such an expedition, cannot add significantly in my consideration of the weight to be given to the Council's case for setting aside the prima facie public interest immunity attaching to the documents.

The degree of public controversy

1. The eighth point set out in Murrumbidgee as requiring consideration was in the following terms: Documents relating to a topic which is current or controversial will attract a high level of confidentiality.
2. Local government amalgamations are a matter of public notoriety and controversy, even if that notoriety and controversy is only taken to be evidenced by amalgamations contested in the various proceedings to which reference has already been made.
3. There is no doubt that the documents sought by the Council in these proceedings relate to a topic which is self-evidently highly "current or controversial". As such, this is a factor weighing in favour of preserving their confidentiality. The weight of this factor in favour of the substantive orders sought in these proceedings is significant.

Conclusion

1. I have concluded that the two documents sought to be produced to the Plaintiff by the Second and Third Defendants require balancing with matters pressed by the Council with the presumed public interest immunity to determine if the presumed immunity acts to prevent access to them.
2. Having established that, as a starting finding, such immunity prima facie applies, I have then proceeded to consider the four grounds upon which the Council says that access should be granted because such access would be likely to assist, materially, the Council's case in this litigation. I have earlier set out my conclusions as to the validity (or, if valid, the strength) of each such ground.
3. Having done so, I have proceeded to weigh the public interest value of nondisclosure with that of the service of the interests of justice if the documents were made available.
4. I have had regard to the extent of the public controversy over council amalgamations, as a factor disclosed by past authority, as weighing in favour of non-disclosure.
5. I have concluded that the reasons advanced by the Council as to why the documents should be released are either without foundation or have such limited potential validity as not to outweigh the public interest in the non-disclosure of the documents.
6. The result, therefore, must be that the substantive orders sought by the Second and Third Defendants in their Amended Notice of Motion of 27 May should be made.

Orders

1. The orders of the Court therefore are: 1. Pursuant to ss 130 and 131A of the Evidence Act 2005 (NSW) and s 23 of the Land and Environment Court Act 1979, the proper officer of the Department of Premier and Cabinet is excused from producing those documents caught by the Notice to Produce for Inspection issued to it on behalf of the Plaintiff on 14 April 2016; 2. Pursuant to ss 130 and 131A of the Evidence Act 2005 (NSW) and s 23 of the Land and Environment Court Act 1979, the Minister for Local Government is excused from producing those documents caught by the Notice to Produce for Inspection issued to him on behalf of the Plaintiff on 14 April 2016; and 3. The exhibits are returned.

---

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 30 May 2016