MURLAN CONSULTING PTY LTD v KU-RING-GAI MUNICIPAL COUNCIL

(2) Remit the reamended notice of motion filed on 18 November 2008 for determination by the Land and Environment Court. DECISION: (3) Dismiss the appeal from the orders as to costs made on 15 February 2009.

(4) Order that the first respondent pay the appellant's costs in this Court.

CATCHWORDS: ADMINISTRATIVE LAW - apprehension of bias - association between Acting Commissioner of Land and Environment Court and party to dispute - no direct pecuniary interest - professional and research-related collaboration between Acting Commissioner and local council - whether capable of giving rise to reasonable apprehension of bias - whether decision afflicted by reasonable apprehension of bias can be set aside - Land and Environment Court Act 1979 (NSW), s 14 - APPEAL - erroneous decision of Court below on question of law - evaluative judgment on correct legal principle not made - factual assessment necessary - more than one conclusion reasonably open - whether matter to be remitted - Land and Environment Court Act 1979 (NSW), s 57 - PROCEDURE - Land and Environment Court - challenge to decision of Commissioners after statutory appeal dismissed - original order made irregularly, illegally or against good faith - apprehension of bias - Uniform Civil Procedure Rules 2005 (NSW) r 36.15 - WORDS AND PHRASES - "reasonable apprehension of bias"

Commonwealth Authorities and Companies Act 1997 (Cth), s 27F Corporations Act 2001 (Cth), ss 191, 192 Environmental Planning and Assessment Act 1979 (NSW), ss 82, 97 LEGISLATION CITED: Land and Environment Court Act 1979 (NSW), ss 12, 14, 17, 36, 38, 39, 56A, 57; Sch 1, cll 1, 2, 6 Local Government Act 1993 (NSW), ss 374, 451 Supreme Court Act 1970 (NSW), s 75A Uniform Civil Procedure Rules 2005 (NSW), r 36.15

B & L Linings Pty Ltd v Chief Commissioner of State Revenue [2007] NSWCA 300 Berk v Woollahra Municipal Council (1992) 76 LGERA 138 Cameron v Cole [1944] HCA 5; 68 CLR 571 Director-General, Department of Ageing, Disability and Home Care v Lambert [2009] NSWCA 102 Ebner v Official Trustee in Bankruptcy [2000] HCA 63; 205 CLR 337 Greyhound Racing NSW v Cessnock & District Agricultural Association Inc [2006] NSWCA 333 HIA Insurance Service Pty Ltd v Kostas [2009] NSWCA 292 Miltonbrook Pty Ltd v Westbury Holdings Kiama Pty Ltd [2008] NSWCA 38; 71 NSWLR 262 Minister Administering the Crown Lands Act v Bathurst Local Aboriginal Land Council [2009] NSWCA 138 Minister for Immigration and Multicultural Affairs v Jia Legeng [2001] HCA 17; 205 CLR 507 CASES CITED: Murlan Consulting Pty Ltd v Ku-ring-gai Council [2007] NSWLEC 374 Murlan Consulting Pty Ltd v Ku-ring-gai Council [2007] NSWLEC 704 Oshlack v Richmond River Council [1998] HCA 11; 193 CLR 72 Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; 194 CLR 355 The Queen v Australian Broadcasting Tribunal; Ex parte Hardiman [1980] HCA 13; 144 CLR 13 Re Minister for Immigration and Multicultural Affairs; Ex parte Epeabaka [2001] HCA 23; 206 CLR 128 Re Polites; Ex parte the Hoyts Corporation Pty Ltd [1991] HCA 31; 173 CLR 78 S & M Motor Repairs Pty Ltd v Caltex Oil (Australia) Pty Ltd (1988) 12 NSWLR 358 Smith v Collings Homes Pty Ltd [2004] NSWCA 75 Taylor v Taylor [1979] HCA 38; 143 CLR 1 Thaina Town (On Goulburn) Pty Ltd v Sydney City Council [2007] NSWCA 300; 156 LGERA 150 Webb v The Queen [1994] HCA 30; 181 CLR 41

Murlan Consulting Pty Ltd - Appellant PARTIES: Ku-ring-gai Municipal Council - First Respondent John Williams Neighbourhood Group - Second Respondent

COUNSEL: M A Pembroke SC/R P Lancaster/H Bennett - Appellant J E Griffiths SC/M N Allars - First Respondent

Mallesons Stephen Jaques - Appellant SOLICITORS: Deacons - First Respondent Blake Dawson - Second Respondent

LOWER COURT JURISDICTION: Land & Environment Court

LOWER COURT DATE OF DECISION: 4 December 2008

LOWER COURT MEDIUM NEUTRAL CITATION: Murlan Consulting Pty Ltd v Ku-ring-gai Municipal Council [2008] NSWLEC 318

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40127/09 LEC 11193/06

BASTEN JA MACFARLAN JA SACKVILLE AJA

24 September 2009 MURLAN CONSULTING PTY LTD v KU-RING-GAI MUNICIPAL COUNCIL Headnote

In August 2006 the appellant filed a development application with the respondent, Ku-ring-gai Municipal Council ("the Council") which, no decision being made within the prescribed time, was deemed to have been refused. The appellant lodged an appeal under s 97 of the Environmental Planning and Assessment Act 1979 (NSW) ("the EP&A Act") on 12 December 2006. The appeal came within the Class 1 jurisdiction of the Land and Environment Court and was listed before a panel consisting of two Commissioners, who dismissed the appeal on 26 June 2007. The appellant further appealed from that decision to a judge of the Land and Environment Court, Pain J, who dismissed that appeal on 29 October 2007.

In August 2008 the appellant became aware of a number of matters indicating an association between one of the Commissioners who sat on the original hearing and the Council, including involvement in the Council's activities in an advisory capacity, an application to undertake university research funded in part by the Council, and general research collaboration with officers of the Council. The appellant took steps to have the proceedings reopened and the decision of the Commissioners set aside because of a reasonable apprehension of bias. Pain J dismissed the application on 4 December 2008 on the basis that no such reasonable apprehension arose. The appellant sought leave to appeal to this Court from the decision to dismiss the application.

(i) the relevance of the distinction in role between commissioners and judges of the Land and Environment Court;

(ii) the nature of the requisite connection between circumstances alleged to give rise to a reasonable apprehension of bias and the proceedings;

(iii) whether s 14 of the Land and Environment Court Act 1979 (NSW) precluded the setting aside of the Commissioners' decision in any event, and

(iv) the appropriate relief to be granted in the event of the appeal being upheld.

In relation to (i) (per Basten JA, Macfarlan JA and Sackville AJA agreeing):

The distinction between judicial decision-making and extra-curial decision-making processes is appropriately drawn between Commissioners and judges of the Court. The primary judge did not err in drawing such a distinction, it being relevant to the issue at hand, and not engendering an erroneous application of the essential principle: [49]-[51]. Ebner v Official Trustee in Bankruptcy [2000] HCA 63; 205 CLR 337; Minister for Immigration and Multicultural Affairs v Jia Legeng [2001] HCA 17; 205 CLR 507, referred to.

In relation to (ii) (per Basten JA, Macfarlan JA and Sackville AJA agreeing):

In the context of a suggestion of a pre-judgment of a dispute, an assessment of the connection between the allegedly inappropriate circumstances and the matters in issue, whilst not necessarily relevant, is not inappropriate. The primary judge did not err in making reference to such a connection: [55]-[56]. Re Polites: Ex Parte the Hoyts Corporation Pty Ltd [1991] HCA 31; 173 CLR 78; Webb v The Queen [1994] HCA 30; 181 CLR 41, referred to.

There is no basis for limiting analysis of an association between a decision-maker and one of the parties to the identification of a connection between that association and one of the issues in dispute. Such an association may give rise to a reasonable apprehension of bias without any such connection being present. The primary judge accordingly erred in requiring such a connection: [57], [63]-[64]. Ebner v Official Trustee in Bankruptcy [2000] HCA 63; 205 CLR 337; Re Minister for Immigration and Multicultural Affairs; Ex parte Epeabaka [2001] HCA 23; 206 CLR 128, considered.

S & M Motor Repairs Pty Ltd v Caltex Oil (Australia) Pty Ltd (1988) 12 NSWLR 358, referred to.

In relation to (iii) (per Basten JA, Macfarlan JA and Sackville AJA agreeing):

The apparent purpose of s 14(1) is to ensure that Commissioners, who will often perform functions otherwise vested in local councils, are subject to similar controls designed to avoid conflicts of interest. It does not necessarily preclude a conclusion that a decision of Commissioners should be set aside because infected by a reasonable apprehension of bias: [67]. Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; 194 CLR 355; Greyhound Racing NSW v Cessnock & District Agricultural Association Inc [2006] NSWCA 333; Berk v Woollahra Municipal Council (1992) 76 LGERA 138, referred to.

In relation to (iv) (per Basten JA, Macfarlan JA agreeing):

The evaluative judgment necessary to determine whether the association gave rise to a reasonable apprehension of bias having not been made according to correct legal principle, and more than one factual conclusion being reasonably open, the matter ought to be remitted for redetermination: [70]-[71]. Thaina Town (On Goulburn) Pty Ltd v Sydney City Council [2007] NSWCA 300; 71 NSWLR 230; B & L Linings Pty Ltd v Chief Commissioner of State Revenue [2008] NSWCA 187; Director-General, Department of Ageing, Disability and Home Care v Lambert [2009] NSWCA 102 and Minister Administering the Crown Lands Act v Bathurst Local Aboriginal Land Council [2009] NSWCA 138; HIA Insurance Service Pty Ltd v Kostas [2009] NSWCA 292, applied.

Where the Court possesses the power to decide the substantive issue on the basis of facts found by the trial judge, and no benefit is to be derived from the special expertise of the lower court, the Court should exercise that power: [94]-[98]. IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40127/09 LEC 11193/06

BASTEN JA MACFARLAN JA SACKVILLE AJA

24 September 2009 MURLAN CONSULTING PTY LTD v KU-RING-GAI MUNICIPAL COUNCIL Judgment 1 BASTEN JA: In August 2006 the appellant, as agent for the owner of certain lands in Wahroonga filed a development application with the respondent, Ku-ring-gai Municipal Council ("the Council"). The application not having been determined within the prescribed period, the Council was taken to have determined the application by refusing consent: Environmental Planning and Assessment Act 1979 (NSW) ("the EP&A Act"), s 82. The appellant was entitled to appeal from that deemed refusal, pursuant to s 97 of the EP&A Act, and lodged such an appeal with the Land and Environment Court on 12 December 2006. 2 The appeal came within the Class 1 jurisdiction of the Land and Environment Court: see Land and Environment Court Act 1979 (NSW) ("the LEC Act"), s 17(d). The appeal was listed before a panel consisting of two Commissioners who commenced to hear the matter on 30 April 2007. The proceedings continued over some five days, the Court handing down its decision on 26 June 2007 dismissing the appeal and refusing consent to the development application: Murlan Consulting Pty Ltd v Ku-ring-gai Council [2007] NSWLEC 374. 3 The appellant took a further appeal from that decision to a judge of the Court, pursuant to s 56A of the LEC Act. The appeal was heard and determined by Pain J in October 2007, her Honour making orders on 29 October 2007 dismissing the appeal: Murlan Consulting Pty Ltd v Ku-ring-gai Council [2007] NSWLEC 704. 4 In August 2008 the appellant became aware of a number of matters indicating an association between one of the Commissioners who sat on the initial hearing in the Land and Environment Court, namely Acting Commissioner Dr Mark Taylor, and the Council. The appellant thereafter took a number of steps seeking to have the proceedings reopened and the decision of the Commissioners set aside on the basis of a reasonable apprehension of bias. That application came back before Pain J in November 2008 and was dismissed on 4 December 2008: Murlan Consulting Pty Ltd v Ku-ring-gai Municipal Council [2008] NSWLEC 318. 5 The present proceedings, brought pursuant to leave granted by this Court on 21 July 2009, challenge the dismissal of the application before the Land and Environment Court seeking to overturn the decision of the Commissioners on the basis of a reasonable apprehension of bias. Jurisdiction of this Court 6 The appeal to this Court is brought pursuant to s 57 of the LEC Act which relevantly provides: " 57 Class 1, 2 and 3 proceedings - appeals (1) A party to proceedings in Class 1 … of the Court's jurisdiction may appeal to the Supreme Court against an order or decision (including an interlocutory order or decision) of the Court on a question of law." 7 The notice of appeal identified three grounds. Ground 3 concerned the costs orders made by the primary judge in favour of the Council. The ground appeared to challenge the costs orders as inappropriate, even on the basis that the appeal was unsuccessful. It was in terms a complaint that the primary judge failed to have "any, or any adequate, regard to" the proper role of the Council in the proceedings. Whether a ground so formulated adequately identifies a decision by the Land and Environment Court on a question of law may be doubted. In any event, the ground was not ultimately pressed. 8 Ground 1 in the notice of appeal alleged an error of law in "misconstruing and incorrectly applying" the test for disqualification for reasonable apprehension of bias. It is not necessary to consider the complaint under ground 1, as counsel accepted in the course of oral argument that it was not intended that ground 1 should provide any independent basis of challenge separate from the more specific matters identified in ground 2. 9 Accordingly, the appeal turned on the matters identified in ground 2, in the following terms: "Further, the following findings and conclusions, and the reasoning applicable thereto, constituted errors on a question of law by the primary judge: (a) the role of Commissioners is analogous to the role of Tribunal members exercising administrative functions rather than courts and the determination of whether there is a reasonable apprehension of bias by a Commissioner of the Land and Environment Court requires consideration of the different standards applying to administrative decision-makers compared to judicial officers ([2008] NSWLEC 318 at [50], [51]); (b) an ' association ', constituted by the Commissioner's relationship, experience and contact with the Council, could not be sufficient to give rise to a reasonable apprehension of bias unless there were a connection between the subject matter of the association and the subject matter of the proceeding which he was required to determine ([2008] NSWLEC 318 at [60], [62], [68] and [69])." 10 In addition to the questions raised by ground 2, the Court was required to consider a contention raised by the Council on the day of the hearing of the appeal in this Court. The appellant did not object to the matter being raised in this manner, but sought an opportunity to file further submissions following the hearing. Both parties were given such leave. The contention was in the following terms: "On its proper construction, s 14 of the Land and Environment Court Act 1979 (NSW) precludes either in whole or in part the availability of the apprehended bias rule of procedural fairness in respect of a Commissioner of the Land and Environment Court, and is a complete answer to the appellant's appeal." 11 Because statutory provisions in the form of s 57(1) require the identification of a "decision" of the court below on a question of law, awkward questions can arise as to what in fact the court decided, particularly where the decision sought to be challenged has to be inferred from the reasoning of the court or tribunal below. It is clear that such an appeal does not extend to a question of law raised for the first time on appeal: Smith v Collings Homes Pty Ltd [2004] NSWCA 75 at [61] (Handley JA). There is thus a further question as to how, and in what circumstances, a respondent can rely upon a contention involving a question or matter of law which was not raised below. 12 Before addressing the issues identified above, it is necessary to provide not only some factual background to the matters in dispute, but also a brief history of the procedural steps in the Land and Environment Court, which involved several changes of course on the part of the appellant and which appear to have given rise to a level of confusion. Factual background 13 The appellant relied upon a number of circumstances which preceded the first decision in the Land and Environment Court of 26 June 2007, involving Acting Commissioner Taylor. By the time of the second hearing before Pain J in November 2008, the matters relied upon to demonstrate a reasonable apprehension of bias had been divided into two categories, namely (a) "having a financial interest in the outcome of the proceedings" and (b) "having an association with the [Council] and officers of the [Council]": see [2008] NSWLEC 318 at [3]. In respect of (a), the financial interest was said to arise from five specific circumstances; in relation to (b), the "association" was identified by reference to ten specific circumstances, the first of which repeated all the matters relied on in relation to financial interest. However, in this Court the appellant confined its case to one of "association" based on five topics. It is sufficient to identify the topics now relied upon as giving rise to a reasonable apprehension of bias. (a) Application to Australian Research Council. 14 In April 2007 an application was lodged with the Australian Research Council ("the ARC") for funding commencing in 2008, in a category known as "linkage projects". The application was put forward by the University of Technology, Sydney. It identified three "chief investigators" of whom two were members of UTS staff and the third, Dr Taylor, was a senior lecturer at Macquarie University. The title of the proposal was identified as follows: "Uncertainty in predictions from catchment modelling systems and its impact on assessing the geomorphic impact of urban land use changes." 15 The category of application for which funding was made appeared to envisage a degree of collaboration between universities and what were described as "eligible partner organisations". This Court was taken to no information as to what that description might encompass, it being sufficient for present purposes that one of the partner organisations was the Council, as was confirmed by a letter from the Council dated 24 April 2007. The letter read in part: "As part of Ku-ring-gai Council's contribution I am able to commit $6,000 per year for three years funding to this project through the Environmental Levy as part of the monitoring and research program and significant in-kind support through staff time and other monitoring and modelling. As part of the in-kind support, Council will be undertaking hydraulic modelling across four catchments with a total cost of $20,000." 16 The application identified Dr Taylor as a senior lecturer in the Department of Environmental Science at Macquarie University. In a summary of his research contributions, Dr Taylor's entry in the application noted, in part: "My research findings … have guided policy and environmental management at Ku-ring-gai Council. … My success and profile in this area were acknowledged this year with appointment to the NSW Land and Environment Court as an Acting Commissioner, with the privilege to adjudicate on merit-based court cases (Classes 1-3). Given that State Governments exercise significant control over environmental matters, this appointment represents the highest possible form of merit-based environmental decision-making." 17 The total direct costs involved in the application, over the three years of the proposed project, exceeded $500,000. Of that amount, approximately one-third was sought from the ARC with a similar figure being provided by the Universities, primarily through salaries paid to their staff. The "eligible partner organisations" were expected to provide $36,000 in cash and $116,000 in kind, of which approximately 50% was to be supplied by the Council. Part of the funding involved travel to conferences, part of which was to be paid for by the eligible partner organisations and part by the ARC. 18 The appellant emphasised that this was a major research proposal involving a joint venture between a number of organisations, including UTS, Macquarie University and the Council. To the extent that Dr Taylor was one of three chief investigators, benefits by way of research funding, publications and professional advancement could be anticipated as part of the direct benefits which he would derive from acceptance of the application and funding by the ARC. At a personal level, the project involved a co-operative venture between the three chief investigators and Mr Peter Davies, Manager, Sustainability and Natural Environment, with the Council. As the appellant further noted, it was clear that significant planning had gone into the preparation of the application and the agreement of the Council which was formally provided in a document signed by Mr Davies and dated 2 May 2007. 19 The Council sought to downplay the significance of the application for research funding. It noted that the application identified UTS as the organisation to administer the funding, and not Macquarie University, with which Dr Taylor was associated. Further, it noted that none of the funding identified in the application as emanating from the Council, was payable to Dr Taylor. The travel funds payable in the first year, of which $6,000 was to come from the partner organisations was allocated to another of the chief investigators, as was funding sought for an international conference, from the ARC. Similar points were made in relation to subsequent years. (b) Attendance at Albury conference 20 The second matter relied upon by the appellant was that, in May 2007 Dr Taylor attended the Fifth Australian Stream Management Conference at Albury, in the course of which two papers were presented co-authored by Dr Taylor and Mr Davies from the Council, one of which appears to have been presented by Dr Taylor. The conference took place between 21 and 25 May 2007; the hearing of the appeal in the Land and Environment Court took place on 30 April, 1 and 2 May and 28 and 30 May 2007. One of the papers reported a study "conducted to help inform and guide Ku-ring-gai Council's bushland and environmental management practices so as to optimise both expenditure and effectiveness". In the acknowledgments, Dr Taylor and a co-author expressed gratitude to "many staff at Ku-ring-gai Council for their help in the field". (c) Other earlier collaborations 21 On 20 December 2005, Mr Davies sent a letter from the Council to Dr Taylor at Macquarie University confirming the Council's "support and interest as a partner to the collaborative research grant seeking to better understand the relationship between bushland and riparian systems and the impacts of development and effectiveness of policy and management." The letter continued: "As a project, this will further the strong relationship between Ku-ring-gai and various departments and faculties within Macquarie University …. Financially our direct contribution will extend to $23,000." 22 Under this heading, the appellant included reference to documents suggesting that the gestation of the ARC application had arisen in October 2006 and therefore involved co-operative efforts with Mr Davies at the Council until April 2007. (d) Membership of Bushland, Catchments and Natural Areas Reference Group 23 A "Bushland, Catchments and Natural Areas Reference Group" was established by Council in 2004 and held its inaugural meeting on 18 October 2004. Dr Taylor was one of those in attendance. Over the subsequent years, he appears to have been an active member of the group and described himself in the ARC funding application as a "scientific advisor" to the reference group. One of the issues discussed by the group over the years was the protection of the blue gum high forest, part of which was located in Wahroonga and was described in the Commissioners' decision as a critically endangered ecological community. One of the reasons given for rejecting the development application was the adverse impact of particular buildings proposed to be within the blue gum high forest: [2007] NSWLEC 374 at [100]. 24 The minutes of the meeting of the reference group on 2 April 2007 noted that Dr Taylor had attended, but had announced his resignation because of his appointment as an Acting Commissioner of the Court. (e) General collaboration 25 The appellant noted other aspects of the collaboration between the Council and Macquarie University. In December 2004, the Council had adopted a "riparian policy" with respect to creeks and watercourses within its area, the policy resulting from a project which involved the support and assistance of a number of persons, including Dr Taylor. 26 In 2006, Council agreed to pay $3,500 under the Council's small community grants scheme for a project co-ordinated by Dr Taylor, that payment being confirmed on 2 May 2006, a year before the hearing in question. Statutory scheme 27 As the appellant acknowledged, whether or not these matters, either individually or in combination, would have led to a reasonable apprehension of bias on the part of Dr Taylor when he sat as an Acting Commissioner on the appellant's development application depended on the legal context. The relevant statement of principle, relied upon by both parties and extracted by the primary judge, from Ebner v Official Trustee in Bankruptcy [2000] HCA 63; 205 CLR 337 at [6], was expressed in the joint judgment of Gleeson CJ, McHugh, Gummow and Hayne JJ in the following terms: "Where, in the absence of any suggestion of actual bias, a question arises as to the independence or impartiality of a judge (or other judicial officer or juror) … the governing principle is that, subject to qualifications relating to waiver … or necessity …, a judge is disqualified if a fair-minded lay observer might reasonably apprehend that the judge might not bring an impartial mind to the resolution of the question the judge is required to decide." 28 The apparent agreement as to the application of that principle in the present case was qualified, as her Honour recognised, by the fact that a Commissioner in the Land and Environment Court is not in terms a judge, judicial officer or juror. The proper characterisation of a Commissioner, exercising a particular role in an institutional context, is to be identified by reference to the provisions of the LEC Act. 29 Commissioners are appointed under s 12(1) of the LEC Act, by the Governor. They may be appointed in a full-time or part-time position and do not enjoy tenure, holding office for a term of seven years: s 12(2A), (4) and Sch 1, cl 1. A part-time Commissioner is not expected to devote the whole of his or her time to the duties of that office: cf Sch 1, cl 1(2). Their remuneration is determined from time to time by the Minister: Sch 1, cl 2. A Commissioner may be removed from office by the Governor "for misbehaviour or incompetence": Sch 1, cl 6. A Commissioner is guilty of misbehaviour if "during the term of his or her appointment, the person appears as an expert witness, or acts as the representative of any party, in proceedings before the Court": s 12(2B). No doubt other forms of misbehaviour would justify removal from office. 30 The qualifications for appointment as Commissioner reflect the role to be played by Commissioners in exercise of the Court's jurisdiction. Section 12(2) provides in part: " 12 Commissioners … (2) A person is qualified to be appointed as a Commissioner if the person has, in the opinion of the Minister: … (b) suitable qualifications and experience in town or country planning or environmental planning, (c) special knowledge of and experience in environmental science or matters relating to the protection of the environment and environmental assessment, … (h) special knowledge of and experience in urban design or heritage. In appointing Commissioners, the Minister should ensure, as far as practicable, that the Court is comprised of persons who hold qualifications across the range of areas specified in this subsection." 31 Section 14 of the Act, to which it will be necessary to return below in relation to the Council's notice of contention, provides: " 14 Disqualification of Commissioners (1) Where a Commissioner: (a) has a pecuniary interest, direct or indirect, in a matter which is the subject of proceedings before the Court, or (b) is a member, officer, employee or servant of a public or local authority that is a party to any proceedings before the Court, being proceedings in respect of which the Commissioner is exercising any functions conferred or imposed on the Commissioner by or under this Act or the rules, then: (c) the Commissioner shall inform the Chief Judge that the Commissioner has such an interest or is such a member, officer, employee or servant, and (d) the Commissioner shall thereupon cease to exercise those functions in relation to the proceedings. (2) A decision of the Court is not vitiated by reason that a Commissioner has failed to comply with subsection (1)." 32 Conferral of jurisdiction upon Commissioners is at the direction of the Chief Judge: s 36(1)(a). The role of Commissioners within the Court is expressed in terms which deem the decision of the Commissioner or Commissioners to be the decision of the Court: s 36(3). 33 The procedure in the Court is governed by ss 38 and 39. Section 38 relevantly provides: " 38 Procedure (1) Proceedings in Class 1, 2 or 3 of the Court's jurisdiction shall be conducted with as little formality and technicality, and with as much expedition, as the requirements of this Act and of every other relevant enactment and as the proper consideration of the matters before the Court permit. (2) In proceedings in Class 1, 2 or 3 of the Court's jurisdiction, the Court is not bound by the rules of evidence but may inform itself on any matter in such manner as it thinks appropriate and as the proper consideration of the matters before the Court permits." 34 Section 39 deals with the power of the Court in proceedings in Class 1, 2 or 3, using the generic term "appeal" to describe the jurisdiction, including that arising under s 97 of the EP&A Act: s 39(1). That section further provides: " 39 Powers of Court on appeals … (2) In addition to any other functions and discretions that the Court has apart from this subsection, the Court shall, for the purposes of hearing and disposing of an appeal, have all the functions and discretions which the person or body whose decision is the subject of the appeal had in respect of the matter the subject of the appeal. (3) An appeal in respect of such a decision shall be by way of rehearing, and fresh evidence or evidence in addition to, or in substitution for, the evidence given on the making of the decision may be given on the appeal. (4) In making its decision in respect of an appeal, the Court shall have regard to this or any other relevant Act, any instrument made under any such Act, the circumstances of the case and the public interest. (5) The decision of the Court upon an appeal shall, for the purposes of this or any other Act or instrument, be deemed, where appropriate, to be the final decision of the person or body whose decision is the subject of the appeal and shall be given effect to accordingly." 35 There was no contention in these proceedings that the Commissioners were not subject to the rules of procedural fairness, including the obligation to avoid circumstances which would give rise to a reasonable apprehension of bias. Rather, the debate concerned the scope, content and application of those principles. These matters are affected by the following characteristics of the exercise by Commissioners of their statutory functions:

(a) they were not required to be legally qualified but were required to have qualifications, knowledge or experience relevant to the subject matter of such proceedings; (b) they were not bound by the rules of evidence, or matters of form or technicality and were entitled to rely upon and apply their own knowledge and experience to the resolution of the issues in dispute, and (c) they stood in the shoes of the consent authority for the purpose of determining the development application. 36 Whilst these factors were characteristic of administrative, rather than judicial, decision-making, it was also significant that the functions exercised by the Commissioners were part of the jurisdiction of the Court, and that their decisions were decisions of the Court and were thus made within the institutional structure of the Court. They were, thus, required to exercise their statutory functions independently of the consent authority from which the "appeal" was brought. Jurisdiction of this Court 37 Whilst the proceedings in this Court were ultimately concerned with the propriety of the decision made by the Commissioners, the appeal was brought to this Court as an appeal against "an order or decision (including an interlocutory order or decision) of the [Land and Environment] Court on a question of law": LEC Act, s 57(1). The relevant question of law must therefore have been one decided (at least implicitly) in the judgment of Pain J, from which the appeal was brought. 38 The manner in which the matter came before Pain J requires some further explanation. The decision of the Commissioners was first the subject of an appeal to her Honour under s 56A of the LEC Act. Like the appeal to this Court, that appeal was against an order or decision of the Commissioners on a question of law. On 29 October 2007, when her Honour handed down judgment dismissing that appeal, the appellant was not aware of the circumstances upon which it now relies to challenge the decision for apprehended bias. Indeed, the matter of bias not having been raised with the Commissioners for their decision, an appeal would not have lain under s 56A on that ground. 39 An affidavit filed in the Land and Environment Court, the contents of which were not in dispute, recounted how the solicitor for the appellant had become aware of the matters now relied upon with respect to Acting Commissioner Taylor, some months after the first judgment of Pain J, dismissing the s 56A appeal. 40 The matter of apprehended bias was sought to be raised before Pain J, pursuant to a notice of motion filed on 22 August 2008. The particular process invoked was not resolved until the hearing of the application. The "re-amended notice of motion" filed in Court on 18 November 2008 required that the orders of the Commissioners be set aside and the matter remitted for further hearing before a Commissioner or judge other than the Commissioners who heard the matter on the first occasion. The orders were sought pursuant to the Court's "incidental or implied power" and pursuant to r 36.15(1) of the Uniform Civil Procedure Rules 2005 (NSW) ("the UCPR"). Because her Honour was of the view that relief should not be granted on the basis of an apprehension of bias, it was not necessary for her Honour to determine the basis of jurisdiction to grant such relief. However, her Honour indicated a tentative view that she had power under UCPR r 36.15(1) to grant the relief sought. In that respect, the Land and Environment Court was not asked to exercise appellate jurisdiction, but original jurisdiction to set aside an order said to have been made "irregularly, illegally or against good faith". 41 In this Court, both parties accepted that the jurisdiction under r 36.15 was properly invoked and extended to a denial of procedural fairness, based on a reasonable apprehension of bias: see Miltonbrook Pty Ltd v Westbury Holdings Kiama Pty Ltd [2008] NSWCA 38; 71 NSWLR 262 at [85] (Spigelman CJ, Tobias and Campbell JJA agreeing), following and applying Cameron v Cole [1944] HCA 5; 68 CLR 571 at 591 and Taylor v Taylor [1979] HCA 38; 143 CLR 1 at 16 (Mason J). There was no discussion of the constraint suggested by Spigelman CJ in Miltonbrook that the "exercise of the discretion under r 36.15 must be similarly clear cut". 42 Although no issue was raised as to the power of the primary judge to grant the relief, a further question arises, namely the proper order to be made by this Court, if it be established that her Honour made an erroneous decision on a question of law. Erroneous decision on question of law (a) statement of principles 43 The critical legal question determined by her Honour was the correct approach to be adopted in considering whether aspects of Acting Commissioner Taylor's relationship with the Council gave rise to a reasonable apprehension of bias. Her Honour noted the agreement of the parties that the relevant principles were those identified in the joint judgment in Ebner v Official Trustee in Bankruptcy 205 CLR 337 at [6]-[8] (Gleeson CJ, McHugh, Gummow and Hayne JJ): [2008] NSWLEC 318 at [47]. The joint judgment in Ebner stated at [6] the principle noted at [27] above. In a passage of importance in this case, concerning the application of the test, the judgment continued at [8]: "Its application requires two steps. First, it requires the identification of what it is said might lead a judge … to decide a case other than on its legal and factual merits. The second step is no less important. There must be an articulation of the logical connection between the matter and the feared deviation from the course of deciding the case on its merits." 44 However, as will be seen below, reliance upon statements of general principle may have deflected attention from identification of the specific issues to be addressed. Impartiality and independence can be undermined in different ways. In dealing with a statement published by a member of the Refugee Review Tribunal, the High Court wrote in Re Minister for Immigration and Multicultural Affairs; Ex parte Epeabaka [2001] HCA 23; 206 CLR 128 at [21] (Gleeson CJ, McHugh, Gummow and Hayne JJ): "The kind of suspicion presently relevant is one based, not upon interest, or relationship, or association, but upon a form of prejudgment, or predisposition, or, to use the words of Dawson J, 'preconceptions existing independently of the case'." (b) distinguishing roles 45 Her Honour noted key aspects of the test at [48]. She further noted the Council's submission that, as compared to judges, Commissioners had a different role to play in the Court and were subject to different expectations: at [50]. Her Honour continued at [51]: "A commissioner of the Court, whether acting or permanently appointed, is expected to have qualifications and experience which enables him or her to carry out the merit functions necessary for the determination of Class 1 proceedings. That is likely to require work experience and study to achieve the necessary expertise. It is also likely to mean a commissioner will have some familiarity broadly with the issues before him or her and that is desirable. That leads to consideration of the Council's submissions … to the effect that several cases have confirmed that acquaintanceship with issues and even preconceived views are acceptable for decision-makers. The cases cited are referring particularly to tribunal members exercising administrative functions rather than courts, whereas the Commissioners must operate within the Court. Their role, however, requires an application of their expertise in a way which is analogous to the role of tribunal members considered in these cases." 46 Her Honour then noted the following reference in Ebner at [4]: "The application of the principle in connection with decision makers outside the judicial system must sometimes recognise and accommodate differences between court proceedings and other kinds of decision making." 47 As she stated, this passage was applied in Minister for Immigration and Multicultural Affairs v Jia Legeng [2001] HCA 17; 205 CLR 507 at [99] by Gleeson CJ and Gummow J, and the distinction between judicial decision-making and extra-curial processes was further discussed by Hayne J at [180]-[181], and [187]. After referring to the last paragraph, her Honour concluded: "In the case of an 'expert' tribunal, it is assumed a decision-maker may be under no constraints to account for opinions or facts discovered in the course of some other decision." 48 The appellant took issue with these passages in her Honour's judgment, submitting that they resulted in the application of a less demanding test in relation to the appearance of impartiality, as applicable to Commissioners, in contrast to that applied to judges. That weakening of the principle was said to be erroneous in law. 49 This ground of challenge is rejected. First, in terms of principle her Honour's remarks were in accordance with the distinction drawn in those authorities. 50 Secondly, the distinction was relevant. Although the comments of Hayne J in Jia Legeng, with which Gleeson CJ and Gummow J agreed at [100], were expressly stated to be applicable to cases of pre-judgment, and the appellant presented its case in terms of the Acting Commissioner having a financial interest in the outcome of the proceedings and as having an association with the Council, there were aspects of the grounds which invoked an element of pre-judgment, noted by her Honour at [58]. Indeed, the appellant appears itself to have treated the characterisation of the role of the Commissioner as relevant. In dismissing a submission made by the appellant, her Honour stated at [54]: "The fact that Dr Taylor is not a judge and does not swear an oath of office is not a circumstance suggesting an apprehension of bias might more readily arise in this case, contrary to the thrust of the Applicant's submission at par 25." 51 Thirdly, this challenge was made in relation to a section of the judgment setting out matters of principle. Her Honour then dealt separately with the various grounds alleging pecuniary interest and inappropriate association. There is no suggestion that, in carrying out this more particular task, her Honour misapplied the principles which she had correctly identified at [50] and [51]. (c) pecuniary interests 52 Her Honour dealt with questions of financial or pecuniary interest in relatively succinct terms at [55]-[56]. Whilst noting that the concept of "interest" extends beyond pecuniary interest, the primary judge noted that the appellant's reliance was on the concept of pecuniary or financial interest, as identified in four respects. Her Honour noted that the benefits to Dr Taylor were "indirect" in that none of the payments for research were made to him directly. She stated that "all sums were paid to Macquarie University and used on research projects generally within Dr Taylor's areas of expertise and interest, riparian management". (d) association 53 In dealing with the question of association, as a basis for a reasonable apprehension of bias, her Honour acknowledged the width of the concept as expressed by Deane J in Webb v The Queen [1994] HCA 30; 181 CLR 41 at 74, referring to cases where the apprehension might arise from "some direct or indirect relationship, experience or contact with a person or persons interested in, or otherwise involved in, the proceedings". Her Honour also referred to statements in the High Court in Re Polites; Ex parte the Hoyts Corporation Pty Ltd [1991] HCA 31; 173 CLR 78. In that case a Deputy President of the Australian Industrial Relations Commission had disqualified himself from sitting on a Full Bench because, whilst a legal practitioner, he had given advice to one of the parties. In concluding that there was no foundation for a reasonable apprehension as to the impartiality of the Deputy President, the Court (Brennan, Gaudron and McHugh JJ) stated at 87-88: "The prior involvement of a Deputy President with associations or with governments who are frequently parties to proceedings before the Commission cannot be sufficient by itself to amount to a disqualification from sitting in a particular case; nor can the prior acquisition of 'skills and experience' amount to such a disqualification. … A prior relationship of legal advisor and client does not generally disqualify the former advisor, on becoming a member of a tribunal (or of a court, for that matter), from sitting in proceedings before that tribunal (or court) to which the former client is a party. Of course, if the correctness or appropriateness of advice given to the client is a live issue for determination by the tribunal (or court), the erstwhile legal advisor should not sit." (e) the relevant connection 54 Her Honour then proceeded to deal separately with the various grounds of "association" relied on by the appellant, although she did not specifically refer again to the four matters of financial interest which were also relied upon as a basis of inappropriate association. 55 The grounds of appeal challenged three passages in her Honour's judgment dealing with association. The first passage occurred under a heading referring to Dr Taylor's membership of the Council's "Small Community Grants Committee" from 18 October 2005 until 5 August 2008: at [60]. Although her Honour identified specific grounds under particular headings, the discussion was not in all respects fully compartmentalised. Thus, before dealing with the Small Community Grants Committee membership, her Honour had outlined under the previous heading the appellant's case with respect to Dr Taylor's involvement in the reference group, the advisory activities of which were "particularly relied on by the [appellant] as these potentially have some relevance to" the blue gum high forest: at [58]. It seems that her Honour's rejection of this challenge was part of the subject matter of the discussion at [60]. In that paragraph her Honour accepted a submission made by the Council, that "Ebner requires that there be a logical connection between the activities and matters before the decision-maker in the proceedings". Her Honour then stated that there was "no connection" between the activities of the reference group or the Small Community Grants Committee and "the matters in issue in the proceedings". 56 Similar language was used in a different context, to which exception was also taken and to which reference will be made below. Such a connection is implicit in the analysis undertaken in Re Polites. However, that analysis was concerned with a specific challenge to impartiality and was therefore expressed differently from the general statements in Ebner. In Ebner, the relevant connection was expressed to be between the matter giving rise to the apprehension and the "feared deviation from the course of deciding the case on its merits". That test did not necessarily require a connection with the "matters in issue". However, in the context of a suggestion of pre-judgment arising from the Acting Commissioner's membership of the reference group, reference to a connection between the impugned activities and the matters in issue was not inappropriate. This ground of challenge is rejected. 57 The same concern (as to a required connection with an issue in dispute) was raised by the appellant with respect to a number of collaborative research projects undertaken between Dr Taylor and Council staff, together with the conference papers co-authored with a Council staff member, presented at the Albury conference which occurred in the course of the proceedings. With respect to the collaborative research projects which were no longer on foot, it was not inappropriate for her Honour to look for disqualifying connections with the matters in issue in the proceedings. Such an approach was consistent (by analogy) with that required by Re Polites. However, the attendance at the conference while the case was part-heard before the Commissioners fell into a different category. Whilst it might not, by itself, have given rise to any reasonable apprehension of bias, the manner in which that question was addressed was too limited. A case of continuing association must be addressed by reference to the broader test of creating a potential for deviation from the course of deciding the case on its merits, being a test not limited to a connection with the issue in dispute. 58 A similar challenge was raised by the appellant with respect to the two concluding passages in her Honour's judgment at [68]-[69]. The conclusion commenced by acceptance of the principle that "all the facts of the association such as proximity, duration, nature and intensity should be considered", drawing on the reasoning of Kirby P in S & M Motor Repairs Pty Ltd v Caltex Oil (Australia) Pty Ltd (1988) 12 NSWLR 358 at 372-373. Her Honour explained that the appellant had relied upon an extensive catalogue of the Acting Commissioner's research and other activities in relation to the Council, but rejected the challenge on the basis that the appellant had done no more than "simply identify the activities of an academic scientist engaged in expanding his expertise through the usual channels of collaborative and other research, and his entirely proper engagement with the community in his area of academic expertise": at [68]. Her Honour then held that neither individually nor collectively did the various matters "including financial interest" suggest that a reasonable bystander might consider there was a possibility that the Acting Commissioner might not bring an unbiased mind to the issues in the proceedings. Her Honour concluded: "The link between any interest and/or association and the issues in the Class 1 proceedings has not been established." 59 The appellant submitted that her Honour's reasoning in this respect involved a decision on a question of law, namely that the relevant legal test required the connection there articulated. That approach, the appellant contended, was an erroneous application of the reasoning in Ebner. 60 In this Court, the appellant placed emphasis on the circumstances with respect to the ARC grant application. The appellant contended that the preparation and submission of, and expectations in relation to, this application demonstrated a close and on-going connection between the Acting Commissioner and the Council at the time of the hearing. The relationship was not one which had ceased with the Acting Commissioner's appointment to his position within the Court. To the extent that the grant application constituted a continuation of activities which had long pre-dated his appointment within the Court, and accepting that the activities were entirely appropriate and expected of an academic with his research interests, those activities must, nevertheless, have affected his proper role as a Commissioner and the cases on which he could sit. Development applications to which the Council was a party could not properly fall within his exercise of the Court's jurisdiction. 61 In considering such circumstances, the appellant argued that it was erroneous to limit consideration by reference to the connection between the activity and the issue in the proceedings. 62 This complaint is justified. A close connection between an adjudicator and one party may be sufficient to give rise to a reasonable apprehension of partiality without there being any connection between the nature or subject matter of the relationship and the issue in dispute. The relationship in the present case was professional in nature, but in other circumstances it might have been purely social. It is easy to envisage a social relationship having characteristics sufficient to preclude one party acting as an independent decision-maker with respect to disputes between the other and third persons. The fear of deviation from a proper degree of independence and impartiality would not, in such circumstances, necessarily depend upon any connection between the characteristics of the relationship and the issue in dispute. Whilst such a connection may be necessary where that which is feared is pre-judgment of the dispute, to limit the consideration in that way with respect to all forms of association is erroneous. 63 The on-going collaborative association in the present case was one which was no doubt mutually beneficial to both the academic researchers and the Council. The major contributions anticipated from the Universities (through payment of the salaries of the chief investigators), and from an ARC grant, may have allowed the Council to obtain valuable research for a small contribution to the total package. For the chief investigators, including the Acting Commissioner, the carrying out of such research may well have constituted a significant element of their academic and professional careers. There was sufficient basis in these circumstances for the Court to be required to ask whether the reasonable lay observer might reasonably apprehend that the Acting Commissioner might not bring an impartial mind to the determination of an appeal in relation to a development application which had been refused by the Council, in proceedings involving the Council as a party. Limited statutory disqualification 64 On the assumption that there may have been error in the approach taken by the primary judge to the general law principles of apprehension of bias, the Council contended that the result reached by the primary judge was nevertheless correct, because s 14 would in any event preclude the decision being set aside on such a basis. That followed because, the Council contended, the kind of bias relied upon was less clear cut than that which was dealt with by s 14(1). Even in the case of a failure to comply with s 14(1), the decision of the Court would not be vitiated: sub-s (2). 65 The Council accepted that s 14 was not a comprehensive statement of the circumstances in which a Commissioner might be disqualified from sitting on proceedings. For example, par (a), limited to pecuniary interests, would not cover obvious cases of pre-judgment or bias arising out of previous dealings. Similarly, par (b), whilst referring to officers and employees, would not cover a person who was an applicant for employment or was an independent contractor with on-going expectations of work. Nor would paragraph (b) cover employment by a developer or owner of land the subject of a development application. Accepting the limited operation of the provision, the Council nevertheless argued that sub-s (2) conveyed the statutory intention that a reasonable apprehension of bias based upon interest or association should not vitiate a decision of the Court: cf Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; 194 CLR 355 at [91]. 66 There may well be circumstances where such an inference may be drawn from the terms of a specific statutory scheme: see, eg, Greyhound Racing NSW v Cessnock & District Agricultural Association Inc [2006] NSWCA 333 at [112]-[121]. Such an inference may more readily be drawn in respect of industry or sporting bodies given regulatory powers over their members which, in turn, may elect representatives to the board of the regulatory body. A provision such as s 14 is usually directed to the avoidance of conflicts of interest in respect of boards or other bodies, including local councils. Thus, s 14(1) may be seen as effecting a similar purpose to that of s 451 of the Local Government Act 1993 (NSW), requiring councillors to disclose a pecuniary interest in any matter which may come before the council, and to that of ss 191-192 of the Corporations Act 2001 (Cth) and s 27F of the Commonwealth Authorities and Companies Act 1997 (Cth), dealing with directors having a "material personal interest" in a matter to be decided by the board. Section 14(2) has a counterpart in s 374(d) of the Local Government Act. Section 14 is not, in terms, addressed to the position of a person performing an adjudicatory function in an independent tribunal or court. Its apparent purpose is to ensure that Commissioners, who will often perform functions otherwise vested in local councils, are subject, pursuant to s 14(1)(a), to similar controls designed to avoid conflicts of interest. 67 As already noted, the statutory scheme within which Commissioners operate will inform an analysis of the scope, content and application of principles of apprehension of bias; s 14 forms part of that statutory scheme. As Cripps CJ (LEC) held in Berk v Woollahra Municipal Council (1992) 76 LGERA 138 at 145, at a time when commissioners were known as assessors, s 14 "is an indication of Parliament's view of the nature of the assessor's function". It does not, however, as contended by the Council, necessarily preclude a conclusion that a decision of Commissioners should be set aside because infected by a reasonable apprehension of bias. In these circumstances, an erroneous decision of a material question of law having been made out, the final decision of the primary judge should be set aside. Relief in this Court 68 The next question concerns the orders which should be made by this Court. In particular, it is necessary to consider whether it is either open, or appropriate, for this Court to make orders disposing of the proceedings, that is by setting aside the decision of the Commissioners and remitting the matter to the Land and Environment Court for determination of the development application afresh. The answer to that question depends upon the proper construction of s 57 of the LEC Act. 69 Section 57(2) provides that this Court shall: "(a) remit the matter to the Court for determination by the Court in accordance with the decision of the Supreme Court, or (b) make such other order in relation to the appeal as seems fit." 70 The scope of this provision has been considered, over the years, in numerous cases, including recently in Thaina Town (On Goulburn) Pty Ltd v Sydney City Council [2007] NSWCA 300; 71 NSWLR 230; B & L Linings Pty Ltd v Chief Commissioner of State Revenue [2008] NSWCA 187; Director-General, Department of Ageing, Disability and Home Care v Lambert [2009] NSWCA 102; Minister Administering the Crown Lands Act v Bathurst Local Aboriginal Land Council [2009] NSWCA 138 and HIA Insurance Service Pty Ltd v Kostas [2009] NSWCA 292 at [18]-[22] (Spigelman CJ) and [24] (Allsop P); see also at [118]-[120]. These cases enunciate the following principles:

(a) despite the apparent breadth of sub-s (2), the kind of orders permitted will be limited by reference to the subject matter of the appeal; (b) because the appeal is limited to a decision by the Land and Environment Court on a question of law, the orders should properly be limited to that which is appropriate to correct an erroneous decision in that Court; (c) a finding of error does not open a gateway to reconsideration of factual findings made in the Land and Environment Court; (d) nor is a review of factual findings permitted under s 75A of the Supreme Court Act 1970 (NSW); (e) on the other hand, the Court is not necessarily limited to orders of the kind which would be appropriate on judicial review; (f) in particular, the Court may make orders disposing of the proceedings on the basis of facts fully found by the Land and Environment Court or otherwise agreed, or (arguably) on the basis of findings which are the only ones reasonably open in the circumstances, and (g) the Court may exercise a discretionary judgment in disposing of costs orders in the Land and Environment Court. 71 Because the primary judge did not apply the correct test to the question of association, the evaluative judgment required to determine whether a fair-minded lay observer might reasonably apprehend that the Acting Commissioner may not have brought an impartial mind to bear with respect to the appeal, was not made. Determining whether the association between Dr Taylor and the Council satisfied the relevant test required a factual assessment in the statutory context discussed above. Nor can it be said that only one conclusion was reasonably open. Accordingly, the matter must be remitted to the Land and Environment Court for redetermination. 72 Although it was not suggested that the appellant did not rely in the Court below upon the significance of the ARC grant application, and this Court does not have the full submissions made in the Court below, it seems likely that less weight was placed upon that matter in the Land and Environment Court than the considerable significance placed upon it in this Court. In an otherwise detailed consideration of the factual considerations raised before her Honour, Pain J made limited reference to this matter. Other matters, some of which had little current relevance at the date of the hearing before the Commissioners, were apparently given higher priority in the case presented before Pain J. In applying the broader test of connection between an Acting Commissioner and a party, as identified above, various factual considerations will remain open, unaffected by any views expressed or implied in these reasons. Costs 73 On 25 February 2009 the primary judge made two costs orders, in the following terms: "(1) The Applicant pay the First Respondent's costs thrown away as a result of the Applicant's notice of motion and re-amended notice of motion. (2) The Applicant pay the First Respondent's costs of its notice of motion filed 11 December 2008." 74 In its notice of appeal, the appellant sought to challenge the order that it pay the Council's costs of the application in the Land and Environment Court. This ground of appeal did not distinguish between the two elements of the costs order made below. Nor did the orders sought in the notice of appeal clarify the matter, merely seeking an order that the Council pay the appellant's costs in this Court "and the costs of the hearing in the Court below on the Re-amended Notice of Motion dated 18 November 2008". 75 There was an element of ambiguity in the first costs order, which may not have been adverse to the interests of the appellant. The reference in the second costs order to the notice of motion filed on 11 December 2008 was a reference to a motion seeking costs. The costs which were sought by the motion were those identified in order (1), namely those which were "thrown away" as a result of the original notice of motion and the reamendment. It appears that the first order did not cover the full costs of the hearing of the motion on 17 and 18 November 2008. Because the appellant has been successful, it is not necessary to consider whether in the circumstances that then existed, the order made by the primary judge was appropriate. 76 The appellant's comments on the proper role of the Council remain relevant to the question of costs in this Court. In relation to the role of the Council in such proceedings, the views of Gaudron and Gummow JJ in Oshlack v Richmond River Council [1998] HCA 11; 193 CLR 72 at [12] are apposite: "The Council is the authority which had granted the consent upon which the developer relied. In those circumstances, and also having regard to the earlier litigation, it might have been expected that the Council would submit to such order as the Court might make and that it would not become a protagonist, lest by doing so it endanger the impartiality it would be expected to maintain upon any subsequent applications to it which might ensue were relief granted to the appellant." 77 The source of their Honours' comments were the well-known principles with respect to the proper role of tribunals brought before the Court on judicial review proceedings, as explained in The Queen v Australian Broadcasting Tribunal; Ex parte Hardiman [1980] HCA 13; 144 CLR 13 at 35-36. 78 The Council sought to distinguish Oshlack and justify its active participation in the proceedings, both in this Court and the Land and Environment Court, on two bases. The first was that the issues raised, concerning a reasonable apprehension of bias on the part of the Acting Commissioner, did not involve the Council in conducting adversarial proceedings in relation to any issue which would arise before it in respect of the application or any future application from the appellant. Secondly, it pointed out that if it had not appeared in relation to proceedings concerned with the proper administration of justice, the Courts would not have had the benefit of a contravener. 79 Both of these submissions are factually accurate; nevertheless, they do not fully answer the concern expressed in Oshlack that, in taking such a stance, the Council is treating the appellant as an adversary, a fact which was likely to be reflected, one way or the other, in the final costs orders. One result would have been that the appellant incurred costs as a result of the Council's opposition, which it could not recover; the other might have been that the appellant owed the Council money, or was owed money by the Council but had outstanding an unresolved development application (in lieu of the one currently in dispute). 80 It is sometimes said that the Hardiman principle involves an exception in respect of submissions which are limited to the powers and procedures of the tribunal. However, that is not strictly so: the High Court in Hardiman said that the presentation of a case by a tribunal should be regarded as "exceptional" and that where it occurs the presentation should be limited to submissions going to the powers and practices of the tribunal: at 36. The scope of possible exceptional cases was not explored, but must clearly be governed by the degree of inconsistency with the underlying principle, namely that the tribunal should not endanger its impartiality. On that basis, it is true that impartiality will be less endangered by submissions unrelated to the substance of the issues which might come back before it, and will be less endangered in circumstances where the matter is unlikely to go back before the tribunal in any event. It may also be appropriate to grant some weight to the practical consideration that, without any appearance by the tribunal, the Court may be left without the valuable assistance which might be obtained from a contravener. 81 In relation to matters arising in the Land and Environment Court, it will usually be a local council which, as consent authority, is required to determine whether it will take an active part in proceedings, and if so in what manner. However, where there is an issue as to the regularity of the administration of justice in a court or tribunal, the appropriate contravener may well be the Attorney-General and not the consent authority. If the Attorney does not wish to intervene, the Court may be left without a contravener. That, however, is not an obvious reason why the consent authority should take up that role in the absence of the Attorney-General. 82 There was an additional complicating factor in the present case. The role of the Council was in substance to defend the conduct of the Acting Commissioner, in circumstances where his conduct was allegedly compromised by his involvement with the Council itself. The appearance of impartiality on the part of the Acting Commissioner was, at least retrospectively, not enhanced by the Council participating actively in defence of his decision-making role. 83 In any event, no further consideration is necessary in the circumstances. The appellant having been successful, the Council does not resist an order that it pay the appellant's costs in this Court. The appellant should remain liable for the costs it was ordered to pay in the Land and Environment Court. No further order was justified in relation to the costs of the hearing in that Court: indeed this Court was not even taken to the relevant statutory provisions and rules. Conclusions 84 The following orders should be made:

(1) Set aside the orders made by Pain J on 29 October 2007.

(2) Remit the reamended notice of motion filed on 18 November 2008 for determination by the Land and Environment Court.

(3) Dismiss the appeal from the orders as to costs made on 15 February 2009.

(4) Order that the first respondent pay the appellant's costs in this Court. 85 MACFARLAN JA: I agree with Basten JA. 86 SACKVILLE AJA: I am grateful to Basten JA for setting out the procedural and factual background to this appeal. The principal question argued on the appeal was whether the primary Judge erred in law in applying the test for apprehended bias so as to require a connection between the activities undertaken by the Acting Commissioner of the Land and Environment Court ("L&E Court"), including his association with the respondent ("Council"), and the particular issues determined in the Class 1 proceedings in which the Acting Commissioner participated. I agree with Basten JA that the primary Judge fell into error in requiring such a connection. 87 In order to determine the relief to which the appellant ("Murlan") is entitled, it is necessary to consider the source (or sources) of this Court's jurisdiction to hear and determine the appeal. Murlan relied on s 57 of the Land and Environment Court Act 1979 (NSW) ("L&E Court Act") when it sought and obtained leave to appeal from the decision of the primary Judge. Section 57(1) of the L&E Court Act provides, relevantly, that a party to proceedings in Class 1 of the L&E Court's jurisdiction may appeal to the Supreme Court against an order or decision of the L&E Court on a question of law. If the order or decision of the L&E Court was made following an appeal under s 56A against a decision of Commissioners, the appeal to the Supreme Court from the L&E Court requires leave: s 57(4)(c). 88 In the present case, Murlan appealed to the L&E Court under s 56A of the L&E Court Act against the Commissioners' decision in the Class 1 proceeding. Pain J dismissed the appeal and final orders were entered giving effect to her Honour's decision. Murlan did not seek leave to appeal to this Court from the orders made by Pain J dismissing the appeal against the Commissioners' decision. 89 The present appeal is by leave against the decision by Pain J to dismiss a motion filed by Murlan seeking orders setting aside the decision by the Commissioners in the Class 1 proceedings. Murlan filed its motion almost a year after Pain J had determined the s 56A appeal and final orders had been entered. The motion was expressed to invoke the incidental or implied power of the L&E Court or, alternatively, the power conferred by Uniform Civil Procedure Rules 2005 ("UCPR") r 36.15, which enables a court to set aside a judgment that was given or entered irregularly, illegally or against good faith. Murlan claimed that the association between the Acting Commissioner and the Council ("the Council") created a reasonable apprehension of bias and that the appellant had been denied procedural fairness in the Class 1 proceedings by the failure of the Acting Commissioner to disclose the association in a timely fashion or at all. 90 Pain J dismissed Murlan's motion on the ground that the Acting Commissioner's activities and association with the Council did not give rise to a reasonable apprehension of bias. Since her Honour rejected the appellant's apprehended bias contention she did not consider it necessary to determine the source of the L&E Court's jurisdiction to hear and determine the appellant's motion. However, she expressed her "preliminary view" that the appellant was entitled to rely on UCPR r 36.15, because the appellant claimed that the proceedings determined by the Commissioners were irregular by reason of a breach of the principles of procedural fairness. Her Honour considered that the making of a perfected order dismissing the s 56A appeal did not mean that the appellant had "exhausted all its appeal options". 91 The parties to the present appeal accepted that the Court has jurisdiction to hear and determine the appeal by reason of s 57 of the L&E Court. They appear to have done so on the basis that the motion decided by Pain J was within the Class 1 jurisdiction of the L&E Court and that an appeal therefore lies to this Court from her Honour's decision by leave pursuant to s 57(4)(c) of the L&E Court Act. 92 Section 17 of the L&E Court Act specifies the matters within the L&E Court's Class 1 jurisdiction. The proceedings determined by the Commissioners in the present case comprised an appeal by Murlan under s 97(1) of the Environmental Planning and Assessment Act 1979 (NSW) against a determination by the Council. The proceedings came within the L&E Court's Class 1 jurisdiction by virtue of s 17(d) of the L&E Court Act. Although s 17 does not expressly state that an appeal under s 56A of the L&E Court Act from a decision of Commissioners is within the L&E Court's Class 1 jurisdiction, s 57(4)(c) seems to assume that it is. 93 As I shall explain, there may be a question as to whether Pain J in dealing with Murlan's motion, was exercising Class 1 or Class 4 jurisdiction of the L&E Court, or perhaps both. The resolution of this question may determine whether the appeal to this Court was brought to this Court under s 57 of the L&E Court Act (which deals with appeals from Class 1 proceedings) or under s 58 (which deals with appeals from Class 4 proceedings). However, on the assumption that the parties have correctly identified s 57 of the L&E Court Act as the sole source of this Court's jurisdiction to hear and determine the appeal, an issue arises concerning the powers of the Court to grant the relief sought by Murlan. 94 In its notice of appeal filed in this Court, Murlan sought orders setting aside the orders made by the Commissioners in the Class 1 proceedings and remitting the proceedings to a Commissioner or Judge of the L&E Court, other than the Commissioners who made the original decision. The issue that arises is whether this Court, having determined that the primary Judge made an error of law in applying the test of apprehended bias, has power itself to decide whether the appellant was denied procedural fairness in the Class 1 proceedings. To make that decision, the Court would need to consider whether, on the findings made by Pain J, the failure of the Acting Commissioner to declare his activities or association with the Council (or relevant aspects of them), or to disqualify himself from hearing the proceedings on the ground of apprehended bias, constituted a denial of procedural fairness to Murlan. 95 Different views have been expressed as to the extent of this Court's powers on an appeal under s 57(1) of the L&E Court Act. In Minister Administering the Crown Lands Act v Bathurst Local Aboriginal Land Council [2009] NSWCA 138, Tobias JA (at [167]) interpreted the decision in Thaina Town (on Goulburn) Pty Ltd v City of Sydney [2007] NSWCA 300; 71 NSWLR 230, as standing for the proposition that the Court: "if it finds error on the part of the [L&E Court] on a question of law, has the power to determine any question consequential upon that finding which does not require the finding of any new or further facts or the making of inferences from the facts as found."

In B&L Linings Pty Ltd v Chief Commissioner of State Revenue [2008] NSWCA 187, Allsop P said (at [73]) that the reasons of Spigelman CJ (with whom Mason P, Beazley and Ipp JJ agreed) in Thaina Town : "may be seen to be more broadly directed to the exercise of discretion on agreed facts." 96 Basten JA preferred (at [137]-[139]) a narrower interpretation of Thaina Town, consistent with the principles stated in his Honour's judgment in the present case (at [70]). On his Honour's approach it would not be open to this Court, having determined on an appeal under s 57 of the L&E Court Act that the L&E Court erred in law, to make a discretionary or evaluative judgment on the basis of facts determined by the L&E Court, except in relation to costs. 97 The parties to the present appeal did not canvass in any detail the competing views as to the extent of this Court's powers on an appeal under s 57 of the L&E Court Act to make orders of the kind sought by Murlan. On the current state of the authorities, in my view, it is arguable that this Court, having found an error of law by the primary Judge, has power to decide for itself whether on the facts found by her Honour, the Acting Commissioner should have declared his association with the Council and, if objection was taken, disqualified himself on the ground of apprehended bias. I also think that if the power exists there is much to be said for this Court exercising it, rather than remitting the matter to the L&E Court for further consideration of the question of apprehended bias. Not only might this save the parties time and expense, but the decision is not one that depends on, or would benefit from the special expertise of members of the L&E Court. 98 However, since these issues were not fully debated on the appeal, I do not think it appropriate to proceed on the basis that this Court has power on the appeal to make an evaluative judgment on the question of apprehended bias. For that reason, I do not dissent from the conclusion that Murlan's motion should be remitted to the L&E Court for determination as Basten JA has proposed. 99 Although the parties were content to proceed on the basis that this Court's jurisdiction to hear and determine the appeal was conferred by s 57 of the L&E Court Act, I wish to say something further about the source of jurisdiction to hear and determine the appeal from Pain J's decision to dismiss Murlan's motion. 100 The L&E Court has the jurisdiction vested in it by or under the L&E Court Act or any other Act: L&E Court Act s 16(1). The Court also has jurisdiction to hear and dispose of any matter not otherwise within its jurisdiction, being ancillary to a matter within its jurisdiction: s 16(1A). For the purposes of the L&E Court Act, the jurisdiction of the Court is divided into seven classes, as provided in Part 3, Div 1: s 16(2). As I have noted, the matters in respect of which the L&E Court has Class 1 jurisdiction are set out in s 17. The matters included in the L&E Court's Class 4 jurisdiction are specified in s 20. 101 Class 1 of the L&E Court's jurisdiction is to be exercised by a Judge or one or more Commissioners: s 33(1). Class 4 of the Court's jurisdiction is to be exercised by a Judge: s 33(2). If any proceedings before the L&E Court are not being dealt with in the manner appropriate to the class of jurisdiction to which they belong, the Court may order that the proceedings be dealt with in the appropriate manner: s 31(2)(b). If such an order is made, the proceedings are taken to have been duly commenced and any step that has been taken in the proceedings is deemed to have been duly taken: s 31(3). 102 Murlan filed a "Re-Amended Notice of Motion" ("RNM") on 18 November 2008 in the proceedings heard by Pain J. The RNM replaced earlier motions in which Murlan had sought orders setting aside the Commissioners' decision in the Class 1 proceedings. In those earlier motions, Murlan sought, in the alternative, leave to re-open the appeal decided by Pain J under s 56A of the L&E Court Act. Each of the earlier motions stated that Murlan wished to rely on a fresh ground of appeal, namely that: "The decision of [the] Commissioners [in the Class 1 Proceedings] is vitiated by error of law in that [Murlan] was denied procedural fairness by reason of [the Acting Commissioner] failing to disclose [his association with the Council]". 103 The RNM deleted the detailed prayers for relief relating to the re-opening of the appeal and substituted the following: "To the extent necessary, if at all, leave be granted to [Murlan] to re-op[e]n this proceeding." 104 Murlan also filed a document entitled "Third Further Amended Statement of Grounds of Appeal" ("3FASA") dated 18 November 2008. As her Honour recorded in her judgment, the 3FASA identified the matters relied on by the appellant to support the orders sought in the RNM. 105 By seeking leave, if necessary, to re-open the appeal, Murlan presumably was invoking the appellate jurisdiction of the L&E Court conferred by s 56A(1) of the L&E Court Act. To that extent, the application made by Murlan in the RNM may have fallen within the Class 1 jurisdiction of the L&E Court. This would open the way to an appeal to this Court by leave, pursuant to s 57(4)(c) of the L&E Court Act. The powers of the Court on the appeal would be limited to those conferred by s 57. 106 However, Murlan's RNM seems also to have invoked the original jurisdiction of the Court to make orders setting aside a decision of Commissioners that was made irregularly. Murlan relied on UCPR r 36.15, for this purpose, but the RNM also referred to the Court's "incidental or implied power" to set aside the orders made by the Commissioners. This was presumably intended to be a reference to the inherent jurisdiction of a Court (even a court of limited jurisdiction) to set aside a judgment obtained in breach of basic requirements of natural justice: Cameron v Cole [1944] HCA 5; 68 CLR 571; Taylor v Taylor [1979] HCA 38; 143 CLR 1. 107 It may be that the application to Pain J, insofar as it relied on UCPR r 36.15 or the inherent power of the L&E Court, can properly be regarded as ancillary to Murlan's appeal determined by Pain J under s 56A of the L&E Court Act. If so, it may follow that the "matter" before Pain J should be classified as wholly within the Class 1 jurisdiction of the L&E Court. 108 On the other hand, it is arguable that, insofar as her Honour was asked to exercise the powers conferred by r 36.15 or the inherent powers of the Court, the proceedings before her were also within the Class 4 jurisdiction of the L&E Court. Section 20(1)(e) of the L&E Court Act provides that Class 4 jurisdiction of the L&E Court includes proceedings referred to in subsection (2). Section 20(2) confers on the L&E Court: "the same civil jurisdiction as the Supreme Court would, but for section 71, have to hear and dispose of proceedings: (a) … (b) to review, or command, the exercise of a function conferred or imposed by a planning or environmental law …"

Section 71 provides that, subject to s 58, proceedings of the kind referred to in s 20(1)(e) may not be commenced or entertained in the Supreme Court. A " planning or environmental law " includes the EPA Act : L&E Court Act , s 20(3)(a). 109 I recognise that there is an issue as to whether s 97 of the EPA Act can be said to confer or impose a function upon the L&E Court (that is, the function of hearing an appeal by an applicant dissatisfied with the determination of a consent authority with respect to a development application). It may be that a "function", for the purposes of s 20(2)(b), does not include the determination of an appeal under s 97(1) of the EPA Act by the L&E Court. However, if it does, the question is whether Murlan's motion invited the L&E Court to review the exercise of a function conferred by the EPA Act. 110 The L&E Court Act does not define the expression "review". In R v Yooyen (1991) A Crim R 225 (NSWCA), proceedings had been brought in the Supreme Court seeking a declaration that a ruling by a District Court Judge concerning a claim to public interest immunity in an ongoing criminal trial had been incorrect. A single Judge of the Supreme Court (Badgery-Parker J) heard the application and granted the declaration. It was argued on appeal that Badgery-Parker J lacked jurisdiction to grant the declaration because s 48(2)(g) of the Supreme Court Act 1970 (NSW) ("Supreme Court Act") assigned to the Court of Appeal proceedings in the Court "for otherwise reviewing a decision of [the District Court]". 111 Gleeson CJ (with whom Meagher JA and Finlay AJA agreed) considered that the proceedings decided by Badgery-Parker J were within s 48(2)(f) of the Supreme Court Act: "the proceedings were brought following the ruling of Judge Solomon and for the avowed purpose of testing that ruling, and in the proceedings all the parties who were represented before Judge Solomon were joined. The Commissioner sought a binding declaration of right in proceedings in which he, the prosecutor, and the accused, were parties, to the effect that a certain immunity existed. He did that following a ruling by Judge Solomon that no such immunity existed. In my view he was, in the circumstances, inviting Badgery-Parker J to review the decision of Judge Solomon." 112 Gleeson CJ ultimately concluded that the point of construction did not matter because other provisions conferred jurisdiction on Badgery-Parker J to decide the application. The significance of Gleeson CJ's reasoning for present purposes is that his Honour took a broad view of the expression "reviewing". An application which sought to challenge the District Court Judge's ruling and to obtain a binding declaration that it was incorrect was held to be a proceeding "for otherwise reviewing a decision of the District Court". 113 In the present case, the Commissioners did not make a ruling on the apprehended bias point because the Acting Commissioner did not reveal his association with the Council and consequently no application was made for him to disqualify himself. Nonetheless, Murlan's RNM sought orders setting aside the orders made by the Commissioners in the Class 1 proceedings. The relevant parties were present and Murlan sought orders that were binding on them. The application required the Court to consider whether Murlan had been denied procedural fairness in the Class 1 proceedings. I think it likely that the RNM can be described as a proceeding to review the exercise of a function conferred or imposed by the EPA Act for the purposes of s 20(2)(b) of the L&E Court Act (assuming that the Class 1 proceedings involved the exercise of a "function"). 114 If that is so, Pain J would have been exercising the Class 4 jurisdiction as well as the Class 1 jurisdiction of the L&E Court. In those circumstances an appeal from her Honour's decision would seem to lie to this Court under s 58 of the L&E Court Act, which provides as follows: " Class 4 proceedings - appeals (1) Where a party to proceedings in Class 4 of the Court's jurisdiction is dissatisfied with an order or decision (including an interlocutory order or decision) of the Court, the party may appeal to the Supreme Court against the order or decision. (2) On the hearing of an appeal under subsection (1), the Supreme Court shall: (a) make an order reversing, affirming or amending the order or decision appealed against, (b) remit the matter to the Court for determination by the Court in accordance with the decision of the Supreme Court, (c) make an order directing a rehearing of the proceedings in respect of which the order or decision appealed against was made, or (d) make such other order in relation to the appeal as seems fit." 115 It will be seen that an appeal to this Court under s 58 of the L&E Court Act is not limited to an appeal on a question of law. Moreover, the powers of the Court on such an appeal are very much wider than those available on an appeal under s 57. The powers conferred by s 58 would extend, in my view, to deciding on the basis of facts found by Pain J whether Murlan had been denied procedural fairness in the Class 1 proceedings by reason of apprehended bias on the part of the Acting Commissioner. 116 As I have already observed, the parties to the appeal did not address in any detail the source or sources of this Court's jurisdiction to entertain the appeal. Nor did they consider the possible application of s 20(2) of the L&E Court Act. In these circumstances, I do not think it appropriate to rely on s 20(2) of the L&E Court Act as the source of power to consider whether Pain J should have found that Murlan had made out its case based on apprehended bias. 117 For these reasons, I agree with the orders proposed by Basten JA. **********

29/09/2009 - Catchword added - Paragraph(s) Coversheet

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.