Citation : NEILSON & ANOR -v- CITY OF SWAN [2003] WASC 20 (S)

Tort - Misfeasance in public office - Elements of the tort - Tort can be constituted by omissions - Whether a local government authority is the holder of a public office - The state of mind of the defendant - Whether the plaintiff must be a member of a class to whom the public officer owes a particular common law or statutory duty - Whether the principles of vicarious liability apply to the tort

Practice and procedure - Proposed statement of claim disallowed - Whether the applicants should be granted leave to re­plead

Local Government Act 1995 (WA), s 2.5(2)

Rules of the Supreme Court 1971 (WA), O 20 r 9(3), O 21 r 5(2), O 21 r 5(5)

Cannon v Tahche [2002] VSCA 84; (2002) 5 VR 317

Cubillo v Commonwealth (No 2) [2000] FCA 1084; (2000) 103 FCR 1

Dunlop v Woollahra Municipal Council [1982] AC 158

Dunlop v Woollahra Municipal Council [No 2] (1978) 40 LGRA 218

Farrington v Thomson and Bridgland [1959] VicRp 49; [1959] VR 286

Garrett v Attorney-General [1997] 2 NZLR 332

Hall v Governor and Company of the Bank of England [2000] EWCA Civ 140 (19 April 2000)

Henly v Mayor of Lyme [1828] EngR 701; (1828) 5 Bing 91

James v The Commonwealth [1939] HCA 9; (1939) 62 CLR 339

Kimberley Downs Pty Ltd v Western Australia, unreported; SCt of WA; Library No 6414; 25 August 1986

MacKenzie v MacLachlan [1979] 1 NZLR 670

Murcia v City of Nedlands [1999] WASC 241; (1999) 22 WAR 1

Northern Territory of Australia v Mengel (1995) 185 CLR 307

Odhavji Estate v Woodhouse [2003] 3 SCR 263

Pemberton v The Attorney-General [1978] Tas SR 1

R v McCann [1998] 2 Qd R 56

Racz v Home Office [1994] 2 AC 45

Rawlinson v Rice [1998] 1 NZLR 454

Sanders v Snell (1998) 196 CLR 329

Sanders v Snell (No 2) [2003] FCAFC 150; (2003) 130 FCR 149

Tahche v Cannon [2003] HCA Trans 524

Tampion v Anderson [1973] VicRp 32; [1973] VR 321

Tampion v Anderson [1973] VicRp 70; [1973] VR 715

The State of Western Australia v Bond Corporation Holdings Ltd (1991) 5 WAR 40

Three Rivers District Council v Governor and Company of the Bank of England (No 3) [1996] 3 All ER 558

Three Rivers District Council v Governor and Company of the Bank of England (No 3) [2003] 2 AC 1

Whitehorn v The Queen [1983] HCA 42; (1983) 152 CLR 657

Wilson v Metaxas [1989] WAR 285

Barrett v The State of South Australia (1994) 63 SASR 208

Bell v State of Western Australia [2004] WASCA 205; (2004) 28 WAR 555

Gray v Motor Accident Commission (1998) 196 CLR 1

Heptonstall v Gaskin [2004] NSWSC 80

Kuddus v Chief Constable of Leicestershire Constabulary [2001] UKHL 29; [2002] 2 AC 122

NRMA Insurance Ltd v A W Edwards Pty Ltd (1995) 11 BCL 200

Porter v OAMPS Ltd [2005] FCA 232; (2005) 215 ALR 327

Tahche v Abboud [2002] VSC 42

Uren v John Fairfax & Sons Pty Limited [1966] HCA 40; (1966) 117 CLR 118

1 WHEELER JA: I have had the advantage of reading in draft the reasons for decision of Buss JA. I agree with those reasons and have nothing to add.

2 PULLIN JA: I have read the draft reasons prepared by Buss JA. I agree with those reasons and have nothing to add.

3 BUSS JA: The applicants are plaintiffs in Supreme Court action CIV 1341 of 2002. The respondent is the defendant. Templeman J has managed the action in the long causes list.

4 At all material times the first applicant has been the owner of lot 341, Lilydale Road, Gidgegannup ("lot 341"). Between 1995 and April 2003 the applicants occupied lot 341. During that period they were married, but their marriage was dissolved in April 2003.

5 Lot 341 adjoins lot 504, Toodyay Road, Gidgegannup ("lot 504"). Lot 341 is located in a valley and overlooks lot 504. Both lots are within the local government district of the respondent. The functions of the respondent include the preparation of town planning schemes, in relation to any land within its district, under s 7(1) of the Town Planning and Development Act 1928 (WA). Pursuant to that provision, the respondent prepared Town Planning Scheme No 9 ("TPS 9"), and TPS 9 was approved of by the Minister and published in the Gazette.

6 On 10 February 1999 the respondent approved Outline Development Plan 106 ("ODP 106") in respect of lot 504 under TPS 9.

7 The applicants allege in the proceedings that the respondent's approval of ODP 106 was unlawful on various grounds, and claim declaratory relief. The applicants also plead causes of action in tort against the respondent; in particular, they allege that the respondent is liable to them for misfeasance in public office, in negligence, and for breach of statutory duty.

The applicants' attempts to plead their case

8 The writ of summons in the proceedings is dated 18 March 2002 and the original statement of claim was endorsed on the writ. On 6 June 2002 Templeman J ordered that certain parts of the original statement of claim be struck out. His Honour granted the applicants leave to file and serve a minute of amended statement of claim.

9 On 22 July 2002 the applicants filed a proposed amended statement of claim. On 14 August 2002 Templeman J ordered the applicants to amend the format of the proposed pleading. A new minute of proposed amended statement of claim was filed on 19 August 2002. On 25 October 2002 the respondent made application to strike out the new minute. On 12 February 2003 his Honour struck out part of the minute filed on 19 August 2002, but granted the applicants general leave to amend.

10 The applicants then produced a document described as a "memorandum of proposed revised statement of claim" dated 19 May 2003. The respondent objected to the memorandum. On 25 October 2004 Templeman J disallowed parts of the document, but again granted the applicants general leave to amend.

11 The applicants then filed and served a minute of proposed revised statement of claim dated 19 January 2005. It is convenient to refer to this minute as "the proposed statement of claim".

12 The respondent made application to disallow parts of the proposed statement of claim. On 24 March 2005 Templeman J made orders as follows:

(a) references to certain individuals in par 7(2)(c)(iii) of the proposed statement of claim were ordered to be deleted;

(b) paragraphs 7(2)(b) and 10 - 18 inclusive, and par 1 of the prayer for relief, of the proposed statement of claim were disallowed;

(c) the applicants were ordered to pay the respondent's costs of the application; and

(d) the balance of the proposed statement of claim was ordered to stand as the statement of claim in the proceedings.

13 His Honour referred, in par [86] of his reasons for disallowing parts of the proposed statement of claim, to the issue of whether the applicants should again be granted leave to amend. On 24 March 2005, when his Honour published his reasons, there was some discussion about whether the applicants should have leave to replead. The following exchange occurred between Mr Thomson of counsel for the respondent, the first applicant and his Honour:

"...

THOMSON, MR: Is there a need, and I'm not sure that there is, for your Honour to make an order about liberty to apply in case there is an application to replead?

TEMPLEMAN J: No. The position is that there is a statement of claim which has various allegations in it and that remains on foot.

THOMSON, MR: Yes.

TEMPLEMAN J: If Mr Neilson or the plaintiff wished to amend the statement of claim then you will have to make an application.

NEILSON, MR: Yes, sir.

TEMPLEMAN J: That may raise the question of whether the Limitation Act has any bearing on the allegations you wish to make. That would bring that argument out into the open, as it were. That's the way I see it but I'm open to persuasion.

THOMSON, MR: Your Honour, I think the true position might be slightly different and that is the statement of claim that was originally endorsed has been struck out and that what your Honour was considering was in fact an application for the minute that was put forward to stand as the statement of claim and therefore there has been no order making any of those paragraphs stand as the statement of claim.

TEMPLEMAN J: I see. Well, then I should order that the balance of the document stand as the statement of claim.

THOMSON, MR: Yes, I think that's the correct way of looking at it.

TEMPLEMAN J: Yes.

THOMSON, MR: That in fact perhaps means that if Mr Neilson wishes to make a further application to amend at a later point in time, then that can be dealt with on its merits.

..."

14 When the application was argued before this Court, none of the orders made by Templeman J had been extracted.

15 The applicants have made application to this Court for leave to appeal against that part of the orders of Templeman J which disallowed:

(a) paragraphs 13-18, and par 1 of the prayer for relief, of the proposed statement of claim; and

(b) the particulars of foreseeability of the second applicant's psychiatric shock given in par 12 of the proposed statement of claim.

16 On 3 June 2005 Wheeler JA ordered that the application for leave to appeal be heard together with the appeal, if leave be granted.

17 In Wilson v Metaxas [1989] WAR 285 at 294, Malcolm CJ said:

"The object of the requirement that an appeal lies from an interlocutory order only by leave is to reduce appeals from these orders as much as possible. ... The jurisdiction to hear the appeal is founded upon the grant of leave. The grant of leave lies in the discretion of the Court. In general, however, it must be shown that the decision in respect of which leave is sought was wrong, or at least attended with sufficient doubt to justify the grant of leave and, in addition, that substantial injustice would be done by leaving the decision unreversed..."

See also The State of Western Australia v Bond Corporation Holdings Ltd (1991) 5 WAR 40 at 53 - 57. The respondent conceded, in its written submissions, that if this Court were to hold that the learned Judge's decision in respect of which leave is sought was wrong, or at least attended with sufficient doubt to justify the grant of leave, the applicants would suffer substantial injustice if the decision were to be left unreversed.

Strike-out application - test to be applied

18 In Kimberley Downs Pty Ltd v Western Australia, unreported; SCt of WA; Library No 6414; 25 August 1986, Master Staples summarised the principles applicable on an application to strike out a statement of claim on the ground that it discloses no reasonable cause of action:

"(1) The rule is intended to apply only to cases which are really not arguable and not to cases where under the previous practice demurrer would have been the proper course: Packard v Transport Trading and Agency Co Ltd (1912) 14 WALR 191 per Burnside J at p 195.

(2) On the application, not only must all the facts alleged in the statement of claim be accepted as true, but it must be taken for granted that on all other points the pleading is unassailable: Niven v Grant (1903) 29 VLR 102 per Holroyd J at p 106.

(3) Great care must be exercised to ensure that a plaintiff is not improperly deprived of his opportunity for the trial of his case by the appointed tribunal: General Steel Industries Inc v Commissioner for Railways NSW [1964] HCA 69; (1964) 112 CLR 125 per Barwick CJ at p 130.

(4) But the rule should not be reserved for those cases where argument is unnecessary to show the futility of the plaintiff's claim. Argument, even extensive argument, may be necessary to demonstrate that the plaintiff's case is so clearly untenable that it cannot possibly succeed: ibid at p 130.

(5) As a general rule a plaintiff is entitled as of right to have his case heard, to have the facts found and then to argue the question of law as it arises before the trial judge upon the facts as found. It is only in cases in which it can be seen from the outset that, however the facts be found, there is no basis for the legal conclusion contended for by the plaintiff that the pleading should be struck out: Dalgety Australia Ltd v Rubin per Burt CJ (1984, unreported, Lib No 5485).

(6) A court at first instance should be careful not to risk stifling the development of the law by summarily rejecting a claim where there is a reasonable possibility that, as the law develops, it will be found that a cause of action will lie: Hospitals Contribution Fund of Australia v Hunt (1982-1983) 44 ALR 365 per Master Allen at 373."

19 It is necessary to set out the allegations in the proposed statement of claim which are material for the purposes of this application.

(1) Actions of Mr Martin Richardson set out in paragraph 13 of this Statement of Claim as Mr Richardson was at all material times acting pursuant to the course of his employment with the Council as the Principal Planner and current Executive Manager Strategic Community Planning Services of the City of Swan

(2) Actions of Mr Eric Lumsden set out in paragraph 14 of this Statement of Claim, as Mr Lumsden was at all materials times acting pursuant to the course of his employment with the Council as the Chief Executive Officer of the City of Swan

(3) Actions of Mr Robert Stirk set out in paragraph 15 of this Statement of Claim, as Mr Stirk was at all material times acting pursuant to the course of his employment with the Council as the Development Liaison Officer".

21 In par 7 it is alleged that the respondent's approval of ODP 106 was unlawful on various grounds. Paragraph 7 alleges, primarily, that in approving ODP 106 the respondent breached various provisions of TPS 9, and denied the applicants the procedural fairness to which they were entitled.

22 Paragraphs 13 - 18 and the prayer for relief are in these terms:

"13. Mr Martin Richardson misfeased in public office in that:

(1) he held a public office at all relevant times for the purposes of this Statement of Claim as the City of Swan's Principal Planner and subsequently Executive Manager Strategic Community Planning Services

(2) He performed an invalid exercise of power or purported exercise of power in that:

(a) He failed to protect the Plaintiffs' rights to due process and provide access to all information necessary to properly perform functions in that he failed to bring the advice of the Department of Environmental Protection dated 9 February 1999 to the attention of Councillors after its receipt, despite the City of Swan having sought the advice and despite Mr Richardson having provided a memo to Council advising that he would advise them if the Department did comment and as a result the Council of the City of Swan failed to require adequate visual impact assessment of the proposed ODP 106 on the Plaintiffs' property lot 341.

(b) He failed to protect the Plaintiffs' rights to due process in that on 14 January 1999 Mr Richardson sent a letter to the Plaintiffs confirming that legal advice had been received following a query by the Plaintiffs and that the ODP could not be approved in the form in which it was advertised for public comment and that the Plaintiffs would be kept advised of progress, whereas the Plaintiffs were only notified by telephone call at 3 pm on 9 February 1999 that the item would be considered by Council the next day, without any detail given in the telephone call. This late notice deprived the Plaintiffs of numerous opportunities to challenge the ODP, including the ability to formulate a range of detailed questions. The Plaintiffs were only able to formulate 8 hasty questions, and 7 of those were not answered by the City of Swan before its approval of ODP 106. The City of Swan's published policy on answering detailed questions is that detailed questions should be received on the Friday before Council meetings. Mr Lumsden's verbal response at the Council meeting after the Plaintiff Neilson asked his questions at the Council meeting of 10 February 1999 was 'It would have been better to get these questions beforehand'. The Plaintiff Neilson then advised the Council and Mr Lumsden that he had only received telephone advice from Council staff at 3 pm the day before. The Councillors said nothing about this circumstance and proceeded to unanimously approve ODP 106 that night.

(c) He failed to behave honestly or communicate accurately in that he falsely advised the Plaintiff Neilson at a Council meeting on 13 June 2001 (A6) that attempts were made by Mr Richardson to call the Plaintiff Neilson at work before 9 February 1999 to alert him that ODP 106 would be considered by Council on 10 February 1999 but could not contact him, whereas there are two secretaries that take phone messages for the Plaintiff Neilson and no messages were left.

(d) He failed to provide access to all information necessary to properly perform the City of Swan's functions in that:

(i) he provided to the Council of the City of Swan on 10 February 1999 a biased and deficient assessment of the Plaintiffs' submission on ODP 106 dated 10 December 1998, as set out in paragraph 7(2)(c)(vii)

(ii) wrote a report on ODP 106 to the Council of the City of Swan on 10 February 1999 that was not in accordance with various requirements of TPS9, as set out in paragraph 7(1) of this Statement of Claim.

(e) Mr Richardson was the senior planning officer responsible for overseeing planning processes in the City of Swan and failed to correct the large numbers of breaches of TPS9 and denial to the Plaintiffs of natural justice, as set out in paragraph 7 of this Statement of Claim.

(3) The large number of planning errors and procedural irregularities set out in paragraph 7 of this statement of claim show that he acted with reckless disregard for the Plaintiffs' interests and his lack of power

(4) His action caused damage in that it:

(a) contributed to the Plaintiff Loggie's psychiatric shock

(b) caused the Plaintiffs to lose trust in Australian authorities and damaged their sense of community

(c) affected the Plaintiffs' enjoyment of lot 341 and decreased the amenity and value of lot 341.

(5) He was recklessly indifferent that these acts would cause the loss or harm suffered by the Plaintiffs.

14 Mr Eric Lumdsen misfeased in public office in that:

(1) He held a public office at all relevant times for the purposes of this Statement of Claim as the City of Swan's Chief Executive Officer

(2) He performed an invalid exercise of power or purported exercise of power in that:

(a) He failed to protect the Plaintiffs' rights to due process in that:

(i) Mr Lumsden delayed issuing an apology to the Plaintiffs regarding his inappropriate issuing of a defamation threat until two months after he was aware the threat was not in order.

Mr Lumsden's 18 August 1998 [sic] to the Plaintiffs threatened an unlawful law suit. The letter of 18 August 1998 was issued on the same date as the City of Swan's report to the Ombudsman and the letter of 18 August 1998 refers to the Ombudsman's investigation. The threat of unlawful legal action against the Plaintiffs issued on 18 August 1998 was not withdrawn until 1 February 1999, with the threat hanging over the Plaintiffs for almost 6 months, until 9 days before ODP 106 was approved by the City of Swan, and despite an earlier letter from the Department of Local Government to Mr Lumsden in December 1998 advising him that the City of Swan's letter was not in order.

(ii) Mr Lumsden refused to seek legal advice on the lawfulness of the waiver of advertising ODP 106 despite providing the Plaintiff Neilson with specific undertakings in this regard at Council meetings in 2001. Particulars are set out in paragraph (c)(vi) below.

(b) Mr Lumsden was the senior officer responsible for overseeing planning processes in the City of Swan and failed to correct the large numbers of breaches of TPS9 and denial to the Plaintiffs of natural justice, as set out in paragraph 7 of this Statement of Claim.

(c) Mr Lumsden failed to behave honestly or communicate accurately in that:

(i) He advised the Plaintiffs on 1 February 1999 that on returning from leave he had considered a report by the Department of Local Government on the appropriateness of issuing a defamation threat against the Plaintiffs, whereas he had considered the report before going on leave in December 1998.

(ii) On 11 July 2001, he provided false answers to Q1-Q8 asked by the Plaintiff Neilson at a Council meeting of that date in that he advised a detailed report was presented to the Ombudsman dealing among other matters with ODP 106 and related matters, whereas the report did not deal with these matters.

(iii) On 13 June 2001 Mr Lumsden falsely advised that he had requested clarification by the Minister's office in relation to the points that the Plaintiff Neilson had raised regarding the second dam on Lot 504 whereas no such request was actually made by the Council as revealed by subsequent FOI requests by the Plaintiff Neilson for the correspondence

(iv) On 13 June 2001 Mr Lumsden falsely advised in A16 and A17 that the City did not receive any complaints regarding clearing on Lot 504 and had no other cause to investigate Lot 504 whereas the Plaintiffs say that on Thursday 20 July 2000 the Plaintiff Neilson telephoned the City of Swan and reported substantial clearing was in progress and whereas staff and Councillors of the City of Swan visited Lot 504 on 30 March and 4 April 2001 and would have been aware that works had been undertaken including clearing and substantial bitumen road construction.

(v) On 13 June 2001 Mr Lumsden falsely advised (A23) that the City of Swan had acted in a timely, honest and diligent manner in its dealings with the Ombudsman's office in relation to Lot 504 whereas the City of Swan misled the Ombudsman's Office in that Mr Stirk advised the Plaintiff Neilson that the works occurring on Lot 504 in April-June 1998 had been approved by planning staff whereas the City of Swan denied this to the Ombudsman; and Mr Richardson claimed he had considered alternative use categories for the pay fishing proposal such as recreational categories in his report to he [sic] Ombudsman in August 1998, whereas Mr Hubbard (the owner of Lot 504 at the time) advised the Plaintiff Neilson in a telephone call after 12 August 1998 that staff of the City of Swan were not even aware of the fact that recreational land uses are prohibited in the Landscape zone

(vi) On 13 June 2001 Mr Lumsden falsely advised that legal advice was being sought and the matter would be referred back to Council for consideration (A4) in relation to the legality of the waiver of advertising for development applications on Lot 504, and compounded this on 24 October 2001 when the City of Swan falsely advised (A3) in response to a follow up question by the Plaintiff Neilson that it was expediting legal advice on the legality of waiving advertising requirements for uses approved in ODP106 whereas no legal advice was brought back to Council for consideration and Mr Max Hunt declined to answer a question asked by the Plaintiff Neilson in a telephone call in early 2002 enquiring whether the legal advice had been sought.

(vii) On 13 June 2001 Mr Lumsden falsely advised that ODP106 does not involve a cluster subdivision (A5), whereas the report to Council on 10 February 1999 notes that the ODP effectually involves cluster subdivision.

(viii) On 13 June 2001 Mr Lumsden falsely advised that the proponent of ODP106 had never intended to seek strata subdivision for each of the chalets (A6) whereas the ODP document notes that strata titling for the entire property was contemplated

(ix) On 18 April 2001 Mr Lumsden falsely advised that all components of the 12 August 1998 pay fishing proposal were excluded from ODP106 (A5) whereas the approved ODP106 included a fishing village, aquaculture ponds, Trout Master's residence and required the development of an Aquaculture Management Plan, which were part of the August 1998 pay fishing development proposed for Lot 504

(x) On 18 April 2001 (A2) Mr Lumsden falsely advised that no written report was made of the site visit to Lot 504 on 8 July 1998 whereas Mr Stirk did make such a record but it was later destroyed or hidden.

(3) The large number of breaches of due process and dishonest behaviour set out in paragraph 14(2) of this statement of claim show that Mr Lumsden acted with reckless and contumelious disregard for the Plaintiffs' interests and his lack of power.

Additional Particulars of Reason for Contumelious Disregard

The Plaintiffs provided Cr Gregorini with notice in November 1998 that the proposed ODP106 was unlawful and as a consequence he threatened not to renew or to terminate the employment contract of Mr Lumsden. Mr Lumsden thereafter harboured malice towards the Plaintiffs.

(4) His action caused damage in that it:

(a) contributed to the Plaintiff Loggie's psychiatric shock

(b) caused the Plaintiffs to lose trust in Australian authorities and damaged their sense of community

(c) affected the Plaintiffs' enjoyment of Lot 341 and decreased the amenity and value of Lot 341.

(5) He was recklessly indifferent that his acts would cause the loss or harm suffered by the Plaintiffs.

15 Mr Robert Stirk misfeased in public office in that:

(1) He held a public office at all relevant times for the purposes of this Statement of Claim

(2) He performed an invalid exercise of power or purported exercise of power in that he failed to behave honestly in that:

(a) On 18 April 2001 (A2) Mr Stirk co-operated with Mr Lumsden in falsely advising that no written report was made of his site visit to Lot 504 on 8 July 1998 whereas Mr Stirk did make such a record but it was later destroyed or hidden.

(b) Mr Stirk falsely advised Mr Lumsden in June 2001 that he did not advise the Plaintiff Neilson that planning staff had advised him that works occurring on Lot 504 on 8 July 1998 were approved, and this dishonest answer was provided to the Plaintiff Neilson in answer to a question he asked (3.2Q2) at the Council meeting of 13 June 2001.

(3) The dishonest answers to questions asked by the Plaintiff Neilson were provided by Mr Stirk with reckless disregard to the lack of power

(4) His action caused damage in that it:

(a) contributed to the Plaintiff Loggie's psychiatric shock

(b) affected the Plaintiff's trust in government processes

(5) Mr Stirk was recklessly indifferent that these acts would cause the loss or harm suffered by the Plaintiffs

16 The Defendant has misfeased in public office in that it committed unlawful acts in abuse of its powers and duties and these acts were performed with knowledge of the lack of power or reckless indifference to the lack of power and the defendant knew or ought to have known or was recklessly indifferent that these acts would cause the loss or harm suffered by the Plaintiffs in that the Council of the Defendant exercised its planning powers to approve ODP106 on 10 February 1999 and the act and process of approving ODP106 was unlawful for the reasons set out in paragraph 7 and the act was performed with reckless indifference to the lack of power as seen by the large number of procedural and technical errors made by the Defendant set out in paragraph 7. The Defendant must have known or ought to have known that in such circumstances it had no power to act as it did given that the Plaintiffs drew its attention to questions about the unlawfulness of the proposed ODP106, that the proposed ODP106 should have been proceeded with cautiously given that such a large tourist resort was without precedent (as also stated by Councillor Burgess to the Defendant in his own personal written submission on the proposed ODP106) and that in granting approval there was a foreseeable risk of harm to the Plaintiffs as acknowledged by the Defendant in its reports to its Council on 10 February 1999 because the effect of the approval would be to reduce the amenity and/or the value of Lot 341.

17 The Defendant misfeased in public office in that:

(1) It held a public office at all relevant times for the purpose of this Statement of Claim as a local authority

(2) It performed an invalid exercise of power or purported exercise of power in that:

(a) It approved ODP106 unlawfully, as set out in paragraph 7 of this Statement of Claim

(b) Its staff performed invalid exercises of power as set out in paragraphs 13 to 15 of this Statement of Claim and it is liable for the actions of its staff as the actions were performed in the course of, or purported course, of their employment with the City of Swan

(3) It acted with contumelious disregard for the Plaintiffs [sic] interests in that the large number of procedural errors and breaches of TPS9 set out in paragraph 7 of this Statement of Claim and lies to the Plaintiffs set out in paragraphs 13 to 15 of this Statement of Claim show that the City of Swan was recklessly indifferent to the law and to the interests of the Plaintiffs.

Additional Particulars of Reckless Indifference to the Law.

The City of Swan did not wish to seek any legal advice that would show ODP106 was in any way unlawful. On 12 and 20 February 2002 the Freedom of Information Commissioner advised the Plaintiff Neilson that the City of Swan had obtained legal advice in January 1999 only because of pressure from the Ombudsman. Further, the City of Swan did not bring back to Council the legal advice it had promised to get in 2001 on the lawfulness of its waiver of advertising requirements for the development applications for uses approved in ODP106 despite giving undertakings on 13 June 2001 and 24 October 2001 to the Plaintiff Neilson to do this.

(4) The City of Swan's actions caused damage in that they:

(a) contributed to the Plaintiff Loggie's psychiatric shock

(b) affected the Plaintiffs' enjoyment of Lot 341 and decreased the amenity and value of Lot 341 through the approval of ODP106

18 As a result of the actions complained of in paragraphs 10 to 17, the Plaintiff Loggie suffered psychiatric shock and damage to her sense of community and the Plaintiff Neilson suffered diminution and loss of the companionship of his wife for the period from August 1998 to their divorce in April 2003. Particulars of the Plaintiff Loggie's psychiatric shock will be provided before trial.

...

And the plaintiffs claim:

1 General, aggravated and exemplary damages and special damages following on the harm and damage they have suffered because of the City of Swan's actions.

2 A declaration that the City of Swan unlawfully approved ODP106.

3 Costs."

Paragraph 13 - 15 of the proposed statement of claim: the learned Judge's reasons

23 The learned Judge, at [53] - [56], distinguished between breaches of duty, on the one hand, and abuse of power, on the other, in the course of considering par 13 of the proposed statement of claim. His Honour said, relevantly:

"[In Three Rivers District Council v Governor and Company of the Bank of England (No 3)], Lord Millett ... referred to the necessity of distinguishing breach of duty and abuse of power: only the latter can ground [a] claim for misfeasance in public office.

However, in my view, the matters alleged against Mr Richardson in par 13 of the statement of claim are, in substance, breaches of duty only. It may be accepted that Mr Richardson had a duty to provide proper information to the defendant's Council in order to permit it to make a proper decision about ODP 106. It may be accepted also, for present purposes, that Mr Richardson had a duty to keep the plaintiffs informed of the progress of ODP 106 through the Council.

It follows, in my view, that any failures on the part of Mr Richardson of the kinds alleged against him were breaches of duty. Mr Richardson clearly had power to provide a whole variety of information to the defendant's Council. But I do not think it can be said that he abused that power by providing inadequate information (if that is what he did). If that is the correct analysis, he did not act in excess of his powers.

... the plaintiffs ... refer to the large number of "planning errors and procedural irregularities" in the planning process which led to the approval of ODP 106, for which Mr Richardson is said to have been responsible. If there were such errors and irregularities then Mr Richardson may have been incompetent. However, incompetence is not the same as an abuse of power:"

24 The learned Judge then referred, at [57], to the judgment of Anderson J in Murcia v City of Nedlands [1999] WASC 241; (1999) 22 WAR 1. Anderson J said, at 37 - 38, in relation to the tort of misfeasance in public office:

" ... the plaintiff must not only show damage from the misfeasance, but some misconduct by the public officer or body in the discharge of a duty which it owes to persons, including the person allegedly aggrieved ..."

According to his Honour, at [58], his analysis of the tort of misfeasance in public office did not differ from that of Anderson J in Murcia.

25 The learned Judge added, at [58], that he did not understand Anderson J in Murcia to have suggested that a breach of duty alone might constitute misfeasance in public office. His Honour then referred to a passage from the judgment of Mason CJ, Dawson, Toohey, Gaudron and McHugh JJ in Northern Territory of Australia v Mengel (1995) 185 CLR 307 at 345 (which had been cited by Anderson J in Murcia), where their Honours said:

" ... the weight of authority here and in the United Kingdom is clearly to the effect that [misfeasance in public office] is a deliberate tort in the sense that there is no liability unless either there is an intention to cause harm or the officer concerned knowingly acts in excess of his or her power."

The learned Judge emphasised, at [58], the words "in excess of his or her power", and concluded, at [58] - [59]:

"In other words, misfeasance in public office involves an abuse of power in circumstances in which the person said to have abused his or her power owes a duty to the plaintiff.

In my view, therefore, par 13 does not disclose a cause of action for misfeasance in public office against Mr Richardson. It should be disallowed."

26 The learned Judge then dealt with par 14 of the proposed statement of claim, and said, at [63]:

"I do not think it necessary to set out the detail of these allegations. That is because they are of the same kind as the allegations made against Mr Richardson: if the allegations are true, they represent breaches of duty rather than abuses of power in the sense necessary to establish a claim for misfeasance in public office. Paragraph 14 should therefore be disallowed."

27 The learned Judge then turned to par 15 of the proposed statement of claim, and said, at [66] - [67]:

"For the reasons given above in relation to Mr Richardson and Mr Lumsden, I consider that if these allegations are true, they would reflect only a breach of duty, not an abuse of power in the relevant sense.

Paragraph 15 should therefore be disallowed."

Paragraphs 13 - 15 of the proposed statement of claim: ground of appeal

"His Honour erred in finding that the matters alleged against Mr Richardson, Mr Lumsden and Mr Stirk in pars 13, 14 and 15 of the [proposed statement of claim] were, in substance, breaches of duty only ... "

Paragraphs 13 - 15 of the proposed statement of claim: notice of contention

29 The respondent filed and served a notice of contention. It contends that the decision of the learned Judge to disallow pars 13 - 15 should be affirmed, in addition to the ground relied upon by his Honour, in that:

"[the learned Judge] should have held that pars 13, 14 and 15 ... did not disclose any cause of action known to law in that these paragraphs do not allege that there was any particular common law or statutory duty owed to the [applicants] (as opposed to the public) by the officers named in these paragraphs not to cause damage to the [applicants] ...".

The rationale and elements of the tort of misfeasance in public office

30 The ground of appeal and the notice of contention in relation to pars 13 - 15 of the proposed statement of claim (and the grounds of appeal in relation to other paragraphs of the proposed statement of claim) require an examination of the rationale and elements of the tort of misfeasance in public office.

31 Although the tort has been described as "well-established", it is still evolving. Its precise limits remain undefined. See Mengel at 345; Sanders v Snell (1998) 196 CLR 329 at 346 [42]; Sanders v Snell (No 2) [2003] FCAFC 150; (2003) 130 FCR 149 at 171 - 172 [87].

32 In Three Rivers District Council v Governor and Company of the Bank of England (No 3) [2003] 2 AC 1 Lord Steyn explained, at 190, that the rationale of the tort is that "in a legal system based on the rule of law executive or administrative power 'may be exercised only for the public good' and not for ulterior and improper purposes ...". See also Garrett v Attorney-General [1997] 2 NZLR 332 where Blanchard J, delivering the judgment of the Court of Appeal of New Zealand, said, at 350, that "[t]he purpose behind the imposition of this form of tortious liability is to prevent the deliberate injuring of members of the public by deliberate disregard of official duty".

33 It is convenient to consider the elements of the tort by reference to the following:

(a) the meaning of "public office";

(b) the nature of the defendant's conduct;

(c) the state of mind of the defendant;

(d) the plaintiff's standing to sue, including the nature of any duty which must be owed by the defendant to the plaintiff; and

(e) the plaintiff's loss or damage, including causation and remoteness.

34 In Henly v Mayor of Lyme [1828] EngR 701; (1828) 5 Bing 91 at 107 - 108, Best CJ identified the class of public officers, as follows:

"Now I take it to be perfectly clear, that if a public officer abuses his office, either by an act of omission or commission, and the consequence of that, is an injury to an individual, an action may be maintained against such public officer. The instances of this are so numerous, that it would be a waste of time to refer to them.

Then, what constitutes a public officer? In my opinion, every one who is appointed to discharge a public duty, and receives a compensation in whatever shape, whether from the crown or otherwise, is constituted a public officer.

...

It seems to me that all these cases establish the principle, that if a man takes a reward, - whatever be the nature of that reward, whether it be in money from the crown, whether it be in land from the crown, whether it be in lands or money from any individual, - for the discharge of a public duty, that instant he becomes a public officer; and if by any act of negligence or any act of abuse in his office, any individual sustains an injury, that individual is entitled to redress in a civil action."

35 In Mengel, Brennan J approved this formulation, and added, at 355, that the tort is not confined to an abuse of office by exercise of a statutory power.

36 In Three Rivers (No 3) Lord Steyn said, at 191, in the context of the requirement of the tort that the defendant must be a public officer:

"It is the office in a relatively wide sense on which everything depends. Thus a local authority exercising private-law functions as a landlord is potentially capable of being sued: Jones v Swansea City Council [1990] 1 WLR 54. In the present case it is common ground that the Bank satisfies this requirement."

Lord Hobhouse of Woodborough said, at 230, in relation to the description "holder of a public office":

"It is a broad concept (Calveley v Chief Constable of the Merseyside Police [1989] AC 1228, Henly v Lyme Corpn [1828] EngR 701; 5 Bing 91, 107 - 108) and has been further extended by recognising that there may be a vicarious liability of the relevant governmental authority for the acts of the public official (Racz v Home Office [1994] 2 AC 45)."

37 In my opinion, the authorities have not established definitively the nature and characteristics of a "public office" for the purposes of the tort. See Cannon v Tahche [2002] VSCA 84; (2002) 5 VR 317 at 336 - 339 [49] - [55]; R v McCann [1998] 2 Qd R 56 at 67 - 74; Rawlinson v Rice [1998] 1 NZLR 454 at 459-463; Tampion v Anderson [1973] VicRp 32; [1973] VR 321 at 336 - 337 and, on appeal[1973] VicRp 70; , [1973] VR 715 at 720; R J Sadler, "Liability for Misfeasance in a Public Office" [1992] SydLawRw 13; (1992) 14 Syd L R 137 at 141 - 144; R J Sadler, "Intentional Abuse of Public Authority: A Tale of Three Rivers" (2001) 21 ABR 151 at 169 - 171; P Finn, "Public Officers: Some Personal Liabilities" (1977) 51 ALJR 313 at 314 - 315.

38 It is unnecessary, however, to pursue the issue in this application. The respondent did not contend in its application before the learned Judge, or in its notice of contention before this Court, that parts of the proposed statement of claim should be disallowed on the ground that the employees of the respondent who are referred to in pars 13 - 15 of the proposed statement of claim, and the respondent itself, were not the holders of a public office for the purposes of the tort. Indeed, in its written submissions, the respondent conceded, properly in my opinion, that "[it] is at least arguably settled that a municipality is the holder of public office for the purposes of a misfeasance claim".

39 The impugned conduct of the public officer must concern the performance of public duties (Sanders at 345) or the exercise of public functions (Three Rivers (No 3) at 191).

40 In my opinion, the precise nexus which is required between the impugned conduct on the one hand and the public duties or functions of the public officer on the other is attended by some doubt. See Jones v Swansea City Council [1990] 1 WLR 54 at 69 - 71; MacKenzie v MacLachlan [1979] 1 NZLR 670 at 674; Pemberton v The Attorney-General [1978] Tas SR 1 at 12 - 14.

41 The issue does not, however, require consideration in this application. It was not a factor in the learned Judge's decision to disallow parts of the proposed statement of claim, and it is not referred to by the respondent in its notice of contention.

42 The tort can be constituted by omissions as well as by actions. See Mengel per Brennan J at 355; Three Rivers (No 3) per Lord Hutton at 228, per Lord Millett at 236 - 237.

43 It is generally said that there are two different forms of liability for misfeasance in public office. In Three Rivers (No 3), they were summarised by Lord Steyn, at 191, as follows:

"First there is the case of targeted malice by a public officer, ie conduct specifically intended to injure a person or persons. This type of case involves bad faith in the sense of the exercise of public power for an improper or ulterior motive. The second form is where a public officer acts knowing that he has no power to do the act complained of and that the act will probably injure the plaintiff. It involves bad faith inasmuch as the public officer does not have an honest belief that his act is lawful."

"It can ... now be regarded as settled law that an act performed in reckless indifference as to the outcome is sufficient to ground the tort in its second form."

See also the discussion in Sanders v Snell (No 2), at 173 - 176 [95] - [100].

44 There is some uncertainty, in relation to the second form of the tort, as to the requisite state of mind of the defendant in relation to the acts or omissions which cause loss or damage to the plaintiff. I will consider this issue further in the context of that element of the tort which concerns the plaintiff's loss or damage.

45 In Three Rivers (No 3), Lord Millett said, at 235, that he did not agree with the usual formulation of the two forms of the tort. According to his Lordship, the two forms:

" ... are merely different ways in which the necessary element of intention is established. In the first [form] it is established by evidence; in the second by inference."

" ... the real difference between the two [forms] lies in the starting point. If the plaintiff can establish the official's subjective intention to exercise the power of his office in order to cause him injury, he does not need to establish that the official exceeded the terms of the powers conferred upon him. If, on the other hand, the plaintiff can establish that the official appreciated that he was acting in excess of the powers conferred upon him and that his conduct would cause injury to the plaintiff, the inference that he acted dishonestly or for an improper purpose will be exceedingly difficult and usually impossible to rebut. Moreover, as Blanchard J pointed out in Garrett v Attorney-General [1997] 2 NZLR 332, 350, the consequences of his actions will usually be obvious enough to the official concerned, who can then be taken to have intended the damage he caused. I also agree with him that intention includes subjective recklessness, that is to say (to adopt his words at p 349) a 'conscious disregard for the interests of those who will be affected by' the exercise of the power."

"I respectfully agree that the mental element is satisfied either by malice (in the sense stated) or by knowledge. That is to say, the mental element is satisfied when the public officer engages in the impugned conduct with the intention of inflicting injury or with knowledge that there is no power to engage in that conduct and that that conduct is calculated to produce injury. These are states of mind which are inconsistent with an honest attempt by a public officer to perform the functions of the office. Another state of mind which is inconsistent with an honest attempt to perform the functions of a public office is reckless indifference as to the availability of power to support the impugned conduct and as to the injury which the impugned conduct is calculated to produce. The state of mind relates to the character of the conduct in which the public officer is engaged - whether it is within power and whether it is calculated (that is, naturally adapted in the circumstances) to produce injury."

In Mengel, Deane J referred, at 370 - 371, to the state of mind of the defendant as involving "malice". His Honour said:

"In the context of misfeasance in public office, the focus of the requisite element of malice is injury to the plaintiff or injury to some other person through an act which injuriously affects the plaintiff. Such malice will exist if the act was done with an actual intention to cause such injury. The requirement of malice will also be satisfied if the act was done with knowledge of invalidity or lack of power and with knowledge that it would cause or be likely to cause such injury. Finally, malice will exist if the act is done with reckless indifference or deliberate blindness to that invalidity or lack of power and that likely injury. Absent such an intention, such knowledge and such reckless indifference or deliberate blindness, the requirement of malice will not be satisfied."

47 I have mentioned that the tort can be constituted by omissions as well as by actions. In Three Rivers (No 3), Lord Millett considered, at 236 - 237, the circumstances in which a failure to act can constitute misfeasance in public office, including the necessary state of mind of the defendant. His Lordship said:

"The parties are agreed that there is no conceptual difference between sins of omission and sins of commission. This may be so; but factually there is a great difference between them. It is no accident that the tort is misfeasance in public office, not nonfeasance in public office. The failure to exercise a power is not in itself wrongful. It cannot be equated with acting in excess of power. The tort is concerned with preventing public officials from acting beyond their powers to the injury of the citizen, not with compelling them to exercise the powers they do have, particularly when they have a discretion whether to exercise them or not. There seems to be only one case in the books where a failure to exercise a power gave rise to the tort: R v Dytham [1979] QB 722, 727G, where Lord Widgery CJ said in terms that the neglect must be 'wilful and not merely inadvertent'. Ferguson v Earl of Kinnoull [1842] EngR 942; (1842) 9 Cl & Fin 251 and the cases there cited were all cases of wilful breach of duty. Henly v Lyme Corpn [1828] EngR 701; 5 Bing 91 was in my opinion a case of breach of statutory duty, not of misfeasance in public office.

In conformity with the character of the tort, the failure to act must be deliberate, not negligent or inadvertent or arising from a misunderstanding of the legal position. In my opinion, a failure to act can amount to misfeasance in public office only where (i) the circumstances are such that the discretion whether to act can only be exercised in one way so that there is effectively a duty to act; (ii) the official appreciates this but nevertheless makes a conscious decision not to act; and (iii) he does so with intent to injure the plaintiff or in the knowledge that such injury will be the natural and probable consequence of his failure to act."

See also the observations of Lord Hutton at 228 and Lord Hobhouse of Woodborough at 230. Compare Hall v Governor and Company of the Bank of England [2000] EWCA Civ 140 (19 April 2000) at [27] - [28].

48 In Odhavji Estate v Woodhouse [2003] 3 SCR 263, Iacobucci J, delivering the judgment of the Supreme Court of Canada, accepted that an omission, as well as an act, can give rise to the tort. His Honour said at 284 [26]:

"The tort is not directed at a public officer who is unable to discharge his or her obligations because of factors beyond his or her control but, rather, at a public officer who could have discharged his or her public obligations, yet wilfully chose to do otherwise."

The plaintiff's standing to sue, including the nature of any duty which must be owed by the defendant to the plaintiff

49 In Tampion v Anderson [1973] VicRp 70; [1973] VR 715, Smith J, delivering the judgment of the Full Court of the Supreme Court of Victoria (Smith, Pape and Crockett JJ) said at 720, with respect to the tort:

"The precise limits of the tort have yet to be defined, but certain things are clear. Employment with the Crown is not necessarily a public office for this purpose. The office must be one the holder of which owes duties to members of the public as to how the office shall be exercised. The action has been held to lie in respect of an act done in purported exercise of statutory or common law powers incident to such an office where those powers are knowingly exceeded ... But to be able to sustain an action upon this basis a plaintiff plainly must not only show damage from the abuse; he must also show that he was the member of the public, or one of the members of the public, to whom the holder of the office owed a duty not to commit the particular abuse complained of." [emphasis added]

50 In Dunlop v Woollahra Municipal Council [No 2] (1978) 40 LGRA 218, Yeldham J explained, at 235, why the plaintiff's action against the defendant for misfeasance in public office should fail. His Honour said:

" ... in my opinion, the reason why the plaintiff should be held not to have succeeded in establishing liability on the part of the defendant for misfeasance in office by a public body is that the passing of neither invalid resolution constituted a 'misfeasance' as that word is employed in the various authorities concerning such an action. Although in this context 'misfeasance' does not necessarily involve moral turpitude it does require at least some misconduct by the public officer or body in the discharge of a duty which it owes to persons including the person allegedly aggrieved. I am of the opinion that merely to pass resolutions which are void and of no effect, for whatever reason, and without knowledge of their invalidity, does not constitute an act of abuse by a local authority in its office as such." [emphasis added]

51 An appeal from the judgment of Yeldham J to the Privy Council was dismissed: Dunlop v Woollahra Municipal Council [1982] AC 158. It was unnecessary for their Lordships to consider the correctness of Yeldham J's statement that it is an essential element of the tort that the misconduct by the public officer or body be in the discharge of a duty owed to persons including the person allegedly aggrieved. The advice of the Privy Council, at 172, was, relevantly, as follows:

"[Yeldham J] cited a number of the authorities upon the nature of this tort, to which their Lordships do not find it necessary to refer, for they agree with his conclusion that, in the absence of malice, passing without knowledge of its invalidity a resolution which is devoid of any legal effect is not conduct that of itself is capable of amounting to such 'misfeasance' as is a necessary element in this tort. So, in their Lordships' view, the claim as framed in paragraph 15A also fails."

52 In Mengel, Mason CJ, Dawson, Toohey, Gaudron and McHugh JJ referred, at 346 - 347, to Tampion in the context of considering the limits of the tort:

"One aspect of misfeasance in public office that lacks precise definition is whether, assuming damage, it is sufficient to establish that the public officer knows that he or she is acting without authority or whether there is some additional requirement. For example, it was suggested in Bourgoin SA v Ministry of Agriculture, Fisheries and Food, that there is an additional requirement that damage be foreseeable, and it was said in Tampion v Anderson that the plaintiff must be 'the member of the public, or one of the members of the public, to whom the holder of the officer owed a duty not to commit the particular abuse complained of'. There is a statement in Farrington which might be thought to deny any requirement over and above knowledge that the act is beyond power. It was said in that case that, 'If a public officer does an act which, to his knowledge, amounts to an abuse of his office, and he thereby causes damage to another person, then an action in tort for misfeasance in a public office will lie against him at the suit of that person'. However, there is no indication as to what is comprehended in the expression 'an abuse of his office' and Smith J, whose decision it was, was a member of the Full Court which later stated in Tampion v Anderson that there was, additionally, a requirement that there be a duty to the plaintiff. Moreover, the act complained of in Farrington, namely, that of ordering the closure of a hotel, was one which, if complied with, would necessarily result in damage.

The cases do not establish that misfeasance in public office is constituted simply by an act of a public officer which he or she knows is beyond power and which results in damage. Nor is that required by policy or by principle. Policy and principle both suggest that liability should be more closely confined ...

It may be that analogy with the torts which impose liability on private individuals for the intentional infliction of harm would dictate the conclusion that, provided there is damage, liability for misfeasance in public office should rest on intentional infliction of harm, in the sense that that is the actuating motive, or on an act which the public officer knows is beyond power and which is calculated in the ordinary course to cause harm. However, it is sufficient for present purposes to proceed on the basis accepted as sufficient in Bourgoin, namely, that liability requires an act which the public officer knows is beyond power and which involves a foreseeable risk of harm.

If misfeasance in public office is viewed as a counterpart to the torts imposing liability on private individuals for the intentional infliction of harm, there is much to be said for the view that, just as with the tort of inducing a breach of contract, misfeasance in public office is not confined to actual knowledge but extends to the situation in which a public officer recklessly disregards the means of ascertaining the extent of his or her power. However, that is not what was put in this case. The argument was that it is sufficient that the officer concerned ought to have known that he or she lacked power."

In my opinion, their Honours did not, in that passage or elsewhere in their judgment, accept or endorse the statement in Tampion that a plaintiff who alleges misfeasance in public office must be "the member of the public, or one of the members of the public, to whom the holder of the office owed a duty not to commit the particular abuse complained of".

53 In Mengel, Brennan J held that it is not necessary for the plaintiff to be identified as a member of a class to whom the public officer owes a particular duty. His Honour said, at 357:

"In my opinion, there is no additional element which requires the identification of the plaintiff as a member of a class to whom the public officer owes a particular duty, though the position of the plaintiff may be relevant to the validity of the public officer's conduct."

54 In Mengel, Deane J enumerated, at 370, the elements of the tort of misfeasance in public office, as follows:

"Its elements are: (i) an invalid or unauthorised act; (ii) done maliciously; (iii) by a public officer; (iv) in the purported discharge of his or her public duties; (v) which causes loss or harm to the plaintiff."

This summary statement of the elements of the tort does not include a requirement that the plaintiff be a member of a class to whom the public officer owes a particular duty. His Honour expressed, at 371, "general agreement" with the reasons of Brennan J (subject to a qualification which is not relevant for present purposes).

55 In Garrett, the Court of Appeal of New Zealand discussed the judgment of the High Court in Mengel, and observed, at 346:

"[The joint judgment of Mason CJ, Dawson, Toohey, Gaudron and McHugh JJ] mentioned without apparent endorsement a dictum in Tampion v Anderson [1973] VicRp 70; [1973] VR 715, at p 720, in which the Full Court of the Supreme Court of Victoria expressed the opinion that the plaintiff must be 'the member of the public, or one of the members of the public, to whom the holder of the office owed a duty not to commit the particular abuse complained of'. The joint judgment does not further discuss this point and in his separate judgment Brennan J took the contrary position. With respect, he was right to do so for if the Victorian Court was requiring the existence of a duty of care it would move the tort right into the area occupied by the torts of negligence and breach of statutory duty and leave little room for its separate operation."

56 Although the judgments of the High Court in Sanders v Snell discuss the elements of the tort, there is no mention of whether a duty of the kind referred to in Tampion must be established.

57 In Murcia, Anderson J referred, at 37, to Dunlop, and then said, at 37 - 38 [142]:

"What emerges very clearly from the judgment of Yeldham J is that this form of misfeasance (which may be constituted either by acts of omission or commission) is a tort so that the plaintiff must not only show damage from the misfeasance, but some misconduct by the public officer or body in the discharge of a duty which it owes to persons, including the person allegedly aggrieved: see also the same effect, Tampion v Anderson. The requirement that there be a duty to the plaintiff seems to have been accepted by the majority of the High Court in Mengel (at 346-347). On grounds that I have tried to explain, I have found that the City owed no statutory duty and no common law duty of care to the plaintiffs to comply with the direct requirements of the Act and regulations with respect to the processing of amendments to the City's town planning scheme. On those exact grounds, I would hold that the City owed no duty to the plaintiffs, breach of which would constitute the tort of abuse of office."

58 Garrett was cited in argument before Anderson J, but his Honour did not refer to it in his judgment. I have mentioned that, in my opinion, the joint judgment in Mengel did not approve or endorse the dictum in Tampion.

59 In Three Rivers (No 3), Lord Steyn considered whether it is necessary for the plaintiff to establish the existence of a particular duty owed to him or her by the public officer. His Lordship said, at 193:

"The question is who can sue in respect of an abuse of power by a public officer. Counsel for the Bank argued that in order to be able to claim in respect of the second form of misfeasance, there must be established 'an antecedent legal right or interest' and an element of 'proximity'. Clarke J did not enunciate a requirement of proximity. He observed [1996] 3 All ER 558, 584:

'If an officer deliberately does an act which he knows is unlawful and will cause economic loss to the plaintiff, I can see no reason in principle why the plaintiff should identify a legal right which is being infringed or a particular duty owed to him, beyond the right not to be damaged or injured by a deliberate abuse of power by a public officer.'

The majority in the Court of Appeal held that 'the notion of proximity should have a significant part to play in the tort of misfeasance, as it undoubtedly has in the tort of negligence': ante, p 57D. Counsel for the Bank argued that both requirements are essential in order to prevent the tort from becoming an uncontrollable one. It would be unwise to make general statements on a subject which may involve many diverse situations. What can be said is that, of course, any plaintiff must have a sufficient interest to found a legal standing to sue. Subject to this qualification, principle does not require the introduction of proximity as a controlling mechanism in this corner of the law. The state of mind required to establish the tort, as already explained, as well as the special rule of remoteness hereafter discussed, keeps the tort within reasonable bounds. There is no reason why such an action cannot be brought by a particular class of persons, such as depositors at a bank, even if their precise identities were not known to the bank. The observations of Clarke J are correct."

"I further consider that if the public officer knows that his unlawful conduct will probably injure another person, or is reckless as to that consequence, the plaintiff does not need to show, before liability can arise, some other link or relationship between him and the officer. The requirement of foresight of probable harm to the plaintiff, or recklessness as to such harm, is sufficient to ensure that the tort is confined within reasonable bounds."

Lord Hope of Craighead said, at 197, that he was in "full agreement" with what Lord Steyn and Lord Hutton had said as to the essential elements of the tort, and the requirements which must be satisfied. Lord Millett said, at 235, that he was in "full agreement" with the speeches of Lord Steyn and Lord Hutton, although his Lordship set out, in his own words, what he considered to be the elements of the tort.

60 In Cannon, the salient facts were these. The plaintiff was convicted of rape. His conviction was quashed after evidence emerged that the complainant had fabricated similar allegations. A retrial was ordered but did not proceed. The plaintiff commenced civil proceedings against several people in connection with the prosecution, including the prosecutor (a barrister) and the instructing solicitor (an employee of the Director of Public Prosecutions).

61 The plaintiff alleged that the prosecution and the instructing solicitor had committed the tort of misfeasance in public office by withholding from him evidence that the complainant had fabricated her allegations. The Court of Appeal of Victoria (Winneke P, Charles and Chernov JJA) held, relevantly, as follows:

(a) at 328 [28]:

" ... in order to succeed in an action founded on the tort, the plaintiff must establish that he or she is a member of the public to whom the defendant owed a duty to exercise the power legitimately, namely, only in the public interest and not for an ulterior purpose."

(b) at 333 [40]:

"In order to succeed on a claim based on misfeasance in public office, the plaintiff must also establish that the duty to exercise the relevant power properly was owed to him as a member of the public."

(c) The tort is concerned with the misuse of public powers which are incidents of a public office. See 336 - 339 [49] - [55].

(d) A prosecutorial function does not carry with it any relevant power so that a prosecutor appearing at a trial does not occupy a public office for the purposes of the tort. The prosecutor and the instructing solicitor were not public officers for the purposes of the tort. See 339 [54], 347 [76].

(e) at 347 [77]:

"But even if ... the correct position is that [the prosecutor and the instructing solicitor] did hold a public office at the relevant time and that their failure to disclose the information to the plaintiff during the trial (and the failure by [the instructing solicitor] to pass on the post-trial material to the plaintiff) amounted to a wrongful exercise of that power as the plaintiff alleges, such wrongful conduct could not expose them to liability to the plaintiff for misfeasance in public office because, as we have already said, their duty to conduct the prosecution fairly, and to disclose the information to the plaintiff, was not one which was owed to the plaintiff. The duty to conduct the prosecution fairly was essentially an ethical duty and, if it was owed to anyone, it was, as we have said, owed to the court as is made plain in Richardson v R and in Whitehorn v R."

62 In Whitehorn v The Queen [1983] HCA 42; (1983) 152 CLR 657, Deane J said, at 665:

"The fact that criminal proceedings in this country are adversary in character means that what is required by the standards of fairness and detachment which should be observed by the Crown in the calling of witnesses may be modified by the informed consent of the accused. The requirements of those standards are not, however, directly enforceable at the suit of the accused or anyone else by prerogative writ, judicial order or action for damages. Apart from disciplinary action against prosecuting counsel if failure to observe those standards amounts to professional misconduct, the sanctions available to procure their observance are mainly to be found in the powers of a trial judge, particularly in summing up to the jury or in dealing with an application for an adjournment or for discharge of the jury, to seek to ensure that an accused receives a fair trial and the powers of an appellate court to quash a conviction if the failure of the Crown to observe them has resulted in the accused being denied a fair trial."

63 The plaintiff in Cannon made application to the High Court for special leave to appeal: Tahche v Cannon [2003] HCA Trans 524. Gleeson CJ, McHugh and Hayne JJ refused special leave. The Chief Justice delivered brief reasons on behalf of the Court, as follows:

"In this matter the Court of Appeal was right to conclude that the duties which the applicant alleged the respondents owed were not duties directly enforceable at the suit of the accused or anyone else by prerogative writ, judicial order or action for damages: see Whitehorn v The Queen [1983] HCA 42; (1983) 152 CLR 657 at 665 per Justice Deane. They are duties owed to the court.

The relevant sanction for their breach is the making of orders at the trial of the accused or on appeal to prevent or remedy any miscarriage of justice resulting from breach of duty. That being so, an appeal against the orders of the Court of Appeal would necessarily fail and other questions that the applicant seeks to agitate would not fall for consideration.

The application for special leave to appeal is refused ..."

64 It is apparent, therefore, that any misconduct of the defendants in Cannon of the kind alleged by the plaintiff could not be the subject of a cause of action for damages.

65 The other questions which the applicant sought to agitate before the High Court in Cannon included whether the Court of Appeal had defined too narrowly the nature and characteristics of a "public office", for the purposes of the tort, and whether a plaintiff must establish not only that the defendant is the holder of a public office, but also that the defendant owes a duty to the plaintiff.

66 It is necessary, of course, that the plaintiff, in an action for misfeasance in public office, establish a legal standing to sue. But, in my opinion:

(a) on the current state of the authorities in relation to a tort which is still evolving;

(b) in the absence of binding authority in the High Court; and

(c) in the context of proceedings which are analogous to a strike-out application,

it is at least reasonably arguable that it is not necessary for the plaintiff to establish that he or she is a member of a class to whom the public officer owes a particular common law or statutory duty.

67 In my opinion, the respondent's ground of contention in relation to pars 13 - 15 of the proposed statement of claim has not been established.

The plaintiff's loss or damage, including causation and remoteness

68 The tort is derived from the action on the case and, in consequence, the plaintiff must prove loss or damage. See Farrington v Thomson and Bridgland [1959] VicRp 49; [1959] VR 286 at 293; Tampion at 720; Pemberton at 12, 26; Jones [1990] 1 WLR 54 at 69; Three Rivers (No 3) at 231.

69 As I have mentioned, in Mengel, Mason CJ, Dawson, Toohey, Gaudron and McHugh JJ said, at 347:

"It may be that analogy with the torts which impose liability on private individuals for the intentional infliction of harm would dictate the conclusion that, provided there is damage, liability for misfeasance in public office should rest on intentional infliction of harm, in the sense that that is the actuating motive, or on an act which the public officer knows is beyond power and which is calculated in the ordinary course to cause harm. However, it is sufficient for present purposes to proceed on the basis accepted as sufficient in Bourgoin, namely, that liability requires an act which the public officer knows is beyond power and which involves a foreseeable risk of harm."

It was sufficient, for the purposes of the proceedings in Mengel, for the majority to proceed on the basis, relevantly, that liability requires an act which involves a foreseeable risk of harm, in that:

(a) the respondents (plaintiffs) had argued that the necessary elements of the tort are satisfied by "constructive knowledge" of the absence of power to engage in the relevant conduct and "foreseeability of the injury suffered by the plaintiff": per Brennan J at 358; and

(b) even on the basis of those less stringent requirements, the respondents' (plaintiffs') cause of action for misfeasance in public office failed.

70 In Three Rivers District Council v Governor and Company of the Bank of England (No 3) [1996] 3 All ER 558, Clarke J referred, at 576, to the passage in Mengel, at 347, which I have cited, and said:

"I do not read the majority as approving the foreseeability test. They were merely applying it because it was 'sufficient for present purposes' to do so."

" ... the tort of misfeasance in public office is not concerned with the imposition of duties of care. It is concerned with conduct which is properly to be characterised as an abuse of office and with the results of that conduct. Causation of damage is relevant; foreseeability of damage is not."

72 In Garrett, the Court of Appeal held, at 349:

" ... it is insufficient to show foreseeability of damage caused by a knowing breach of duty by a public officer. The plaintiff, in our view, must prove that the official had an actual appreciation of the consequences for the plaintiff, or people in the position of the plaintiff, of the disregard of duty or that the official was recklessly indifferent to the consequences and can thus be taken to have been content for them to happen as they would."

73 In Sanders v Snell the High Court did not consider this issue.

74 In Three Rivers (No 3) the House of Lords held that a public officer is only liable for damage which he or she actually knew was likely to occur. Lord Steyn said, at 195 - 196:

"The real choice is ... between the test of knowledge that the decision would probably damage the plaintiff (as enunciated by Clarke J) and the test of reasonable foreseeability (as contended for by counsel for the plaintiffs).

...

It is true that Clarke J made new law. He relied on the special nature of the tort. He reasoned from legal principle. It is true that the earlier decision of the majority in the Mengel case runs counter to the conclusion of Clarke J. But apart from the Mengel case there has however been no judicial support for a foreseeability test. ...

Enough has been said to demonstrate the special nature of the tort, and the strict requirements governing it. This is a legally sound justification for adopting as a starting point that in both forms of the tort the intent required must be directed at the harm complained of, or at least to harm of the type suffered by the plaintiffs. This results in the rule that a plaintiff must establish not only that the defendant acted in the knowledge that the act was beyond his powers, but also in the knowledge that his act would probably injure the plaintiff or person [sic] of a class of which the plaintiff was a member."

75 In my opinion, the majority in Mengel did not approve "a foreseeability test". For the reasons which I have set out in par 69 above, in determining the appeal in Mengel, it was sufficient for the majority to proceed on the basis that liability, relevantly, requires an act which involves a foreseeable risk of harm.

76 In Three Rivers (No 3), Lord Hutton was of the view, at 225 - 228, that it is insufficient for the plaintiff to prove objective foreseeability that the breach of duty will probably cause damage. The plaintiff must prove that the public officer knew that his or her conduct would probably injure the plaintiff, or was reckless as to that consequence.

77 According to Lord Millett, in Three Rivers (No 3), at 236:

"It is not, of course, necessary that the official should foresee that his conduct will certainly harm the plaintiff. Nothing in life is certain. Equally, however, I do not think that it is sufficient that he should foresee that it will probably do so. The principle in play is that a man is presumed to intend the natural and probable consequences of his actions. This is the test laid down by Mason CJ writing for the majority of the High Court of Australia and Brennan J in Northern Territory v Mengel 69 ALJR 527, viz that it should be calculated (in the sense of likely) in the ordinary course of events to cause injury. But the inference cannot be drawn unless the official did foresee the consequences. It is not enough that he ought to have foreseen them if he did not do so in fact."

78 It is unnecessary, in this application, to determine whether it is reasonably arguable, in the context of proceedings which are analogous to a strike-out application, that it is sufficient for a plaintiff who relies on the second form of the tort to establish merely that the plaintiff's loss or damage was reasonably foreseeable (as distinct from establishing that the defendant knew his or her conduct would cause or be likely to cause such loss or damage, or was recklessly indifferent to that consequence).

79 In the proposed statement of claim the applicants plead, in effect, in relation to the tort of misfeasance in public office, that the respondent, by its servants or agents, was recklessly indifferent to whether the impugned conduct would cause the loss or damage allegedly suffered by the applicants. The applicants also purport to rely on reasonable foreseeability in part of par 16 of the proposed statement of claim, but otherwise do not rely on this concept. I will deal later in these reasons with that part of par 16 which invokes reasonable foreseeability.

Paragraph 13 of the proposed statement of claim: should the paragraph have been disallowed?

80 The learned Judge disallowed par 13 on the ground that the allegations pleaded "breaches of duty only", and not an abuse of power: pars [54] - [55].

81 His Honour's reasoning, at [53] - [56], was as follows:

"[In Three Rivers (No 3)] Lord Millett ... referred to the necessity of distinguishing breach of duty and abuse of power: only the latter can ground [a] claim for misfeasance in public office.

However, in my view, the matters alleged against Mr Richardson in par 13 of the statement of claim are, in substance, breaches of duty only. ...

... any failures on the part of Mr Richardson of the kinds alleged against him were breaches of duty. Mr Richardson clearly had power to provide a whole variety of information to the defendant's council. But I do not think it can be said that he abused that power by providing inadequate information (if that is what he did). If that is the correct analysis, he did not act in excess of his powers.

As I have noted above, the plaintiffs themselves refer to the large number of 'planning errors and procedural irregularities' in the planning process which led to the approval of ODP 106, for which Mr Richardson is said to have been responsible. If there were such errors and irregularities, then Mr Richardson may have been incompetent. However, incompetence is not the same as an abuse of power."

82 The relevant observations of Lord Millett in Three Rivers (No 3), which were referred to by the learned Judge, appear at 235 of his Lordship's speech, and are as follows:

"The tort is an intentional tort which can be committed only by a public official. From this two things follow. First, the tort cannot be committed negligently or inadvertently. Secondly, the core concept is abuse of power. This in turn involves other concepts, such as dishonesty, bad faith, and improper purpose. These expressions are often used interchangeably; in some contexts one will be more appropriate, in other contexts another. They are all subjective states of mind.

It is important to bear in mind that excess of power is not the same as abuse of power. Nor is breach of duty the same as abuse of power. The two must be kept distinct if the tort is to be kept separate from breach of statutory duty, which does not necessarily found a cause of action. Even a deliberate excess of power is not necessarily an abuse of power. Just as a deliberate breach of trust is not dishonest if it is committed by the trustee in good faith and in the honest belief that it is for the benefit of those in whose interests he is bound to act, so a conscious excess of official power is not necessarily dishonest. The analogy is closer than may appear because many of the old cases emphasise that the tort is concerned with the abuse of a power granted for the benefit of and therefore held in trust for the general public."

83 In my opinion, Lord Millett was emphasising, in this passage, the dishonest mental state of the defendant which is a critical feature of the tort of misfeasance in public office. The tort is concerned with malicious conduct. In other words, the defendant must have acted in bad faith (or failed to act in good faith). By contrast, a mere excess of power or a mere breach of duty, in either case involving intentional or deliberate acts or omissions, may not involve any dishonest mental state, malice or bad faith.

84 Plainly, a breach of duty by a public officer may involve an abuse of power for the purposes of the tort. It will constitute such an abuse of power if the acts or omissions which comprise the breach were intentional or deliberate and accompanied by dishonesty, malice or bad faith. Similarly, conduct by a public officer in excess of power may involve an abuse of power for the purposes of the tort. It will constitute such an abuse of power if the conduct which comprises the excess of power was intentional or deliberate and accompanied by dishonesty, malice or bad faith.

85 Paragraph 13(1) of the proposed statement of claim pleads the public office held by Mr Richardson, par 13(2) pleads the impugned conduct, par 13(3) pleads Mr Richardson's alleged mental state in relation to the impugned conduct, par 13(4) pleads the applicants' alleged loss or damage, and par 13(5) pleads Mr Richardson's alleged mental state in relation to the alleged loss or damage.

86 It is convenient to consider the allegations in par 13, first, by reference to each aspect of the impugned conduct pleaded in par 13(2), and then by reference to par 13(3), (4) and (5).

87 The applicants allege, in essence, that Mr Richardson "performed an invalid exercise of power or purported exercise of power" in that he failed to bring to the attention of the councillors of the respondent certain written advice dated 9 February 1999 of the Department of Environmental Protection and, in consequence, the council of the respondent failed to require adequate visual impact assessment of the proposed ODP 106 on lot 341.

88 The applicants plead an omission as distinct from an act. The applicants' characterisation of this failure to act as "an invalid exercise of power or purported exercise of power" is therefore misconceived.

89 In my opinion, the alleged omission pleaded in par 13(2)(a), in the context of par 13 as a whole, does not disclose a reasonably arguable cause of action, in that:

(a) it is not alleged that, in the circumstances, Mr Richardson was under a duty to bring the written advice to the attention of the councillors promptly after its receipt;

(b) it is not alleged that Mr Richardson appreciated that he was under that duty, but nevertheless made a conscious decision not to act; and

(c) it is not alleged that Mr Richardson decided not to bring the written advice to the attention of the councillors with intent to injure the applicants or in the knowledge that such injury would be the natural and probable consequence of his failure to act.

See Three Rivers (No 3) per Lord Millett at 236 - 237 in relation to omissions which may constitute the tort.

90 The applicants allege, in essence, that on 14 January 1999 Mr Richardson sent a letter to the applicants informing them, amongst other things, that "the ODP could not be approved in the form in which it was advertised for public comment, and that the Plaintiffs would be kept advised of progress, whereas the Plaintiffs were only notified by telephone call on 9 February 1999 that the item would be considered by Council the next day, without any detail given in the telephone call". The applicants also allege that this "late notice deprived the Plaintiffs of numerous opportunities to challenge the ODP".

91 The applicants plead an omission as distinct from an act. In particular, it is alleged that Mr Richardson failed to fulfil his promise that the applicants would "be kept advised of progress". The applicants' characterisation of this failure to act as "an invalid exercise of power or purported exercise of power" is therefore misconceived.

92 In my opinion, the alleged omission pleaded in par 13(2)(b), in the context of par 13 as a whole, does not disclose a reasonably arguable cause of action. It suffers from defects of the same kind as those referred to in par 89 above in relation to par 13(2)(a).

93 The applicants allege, in essence, that Mr Richardson "falsely advised the Plaintiff Neilson at a Council meeting on 13 June 2001 that attempts were made by Mr Richardson to call the Plaintiff Neilson at work before 9 February 1999 to alert him that ODP 106 would be considered by Council on 10 February 1999 but could not contact him".

94 The applicants plead the making of a false statement.

95 The false statement was allegedly made more than two years after the respondent approved ODP 106. Accordingly, the statement could not have affected the applicants' enjoyment of lot 341 or decreased the amenity and value of lot 341, as alleged in par 13(4)(c).

96 Further, this alleged false statement by Mr Richardson in relation to his prior conduct does not, in the circumstances pleaded in par 13(2)(c), involve "an exercise or purported exercise of power".

97 In my opinion, the alleged false statement pleaded in par 13(2)(c), in the context of par 13 as a whole, does not disclose a reasonably arguable cause of action.

98 The applicants allege, in essence, that Mr Richardson:

(a) provided to the council of the respondent on 10 February 1999 a biased and deficient assessment of the written submission dated 10 December 1998 made by the applicants in relation to ODP 106; and

(b) provided to the council of the respondent on 10 February 1999 a report in relation to ODP 106 that was not in accordance with the requirements of TPS 9.

99 The applicants plead, in substance, an omission as distinct from an act. In particular, it is alleged that Mr Richardson failed to provide the council of the respondent with a proper assessment of the applicants' submission on ODP 106 and failed to write a report on ODP 106 that was in accordance with TPS 9. The applicants' characterisation of this failure as "an invalid exercise of power or purported exercise of power" is therefore misconceived.

100 In my opinion, the alleged omissions pleaded in par 13(2)(d), in the context of par 13 as a whole, do not disclose a reasonably arguable cause of action. They suffer from defects of the same kind as those referred to in par 89 above in relation to par 13(2)(a).

101 The applicants allege, in essence, that Mr Richardson "failed to correct the large number of breaches of TPS 9 and denial to the Plaintiffs of natural justice, as set out in paragraph 7 of this Statement of Claim".

102 The applicants plead an omission as distinct from an act. The applicants' characterisation of this failure as "an invalid exercise of power or purported exercise of power" is therefore misconceived.

103 In my opinion, the alleged omission pleaded in par 13(2)(e), in the context of par 13 as a whole, does not disclose a reasonably arguable cause of action. It suffers from defects of the same kind as those referred to in par 89 above in relation to par 13(2)(a).

104 Paragraph 13(3) alleges, in essence, that it may be inferred that Mr Richardson acted "with reckless disregard for the Plaintiffs' interests and his lack of power" in consequence of the numerous planning errors and procedural irregularities pleaded in par 7 of the proposed statement of claim.

(a) paragraph 13(2) alleges, in substance, omissions and a false statement, rather than a "lack of power"; and

(b) the allegation that Mr Richardson acted "with reckless disregard for the Plaintiffs' interests" does not (either in itself or in combination with any other pleas in par 13) remedy the defects in par 13(2).

106 In par 13(4) it is alleged that Mr Richardson's "action caused damage" in that it:

(a) "contributed to the Plaintiff Loggie's psychiatric shock";

(b) "caused the Plaintiffs to lose trust in Australian authorities and damaged their sense of community"; and

(c) "affected the Plaintiffs' enjoyment of Lot 341 and decreased the amenity and value of Lot 341".

107 In par 13(5) it is alleged that Mr Richardson was "recklessly indifferent that these acts would cause the loss or harm suffered by the Plaintiffs".

108 In my opinion, par 13(4) and (5) are deficient in that, even if the conduct pleaded in par 13(2) is capable of founding a cause of action, par 13(4) and (5) do not plead any material facts from which it may be inferred that Mr Richardson engaged in the impugned conduct with knowledge that it would cause or be likely to cause the particular loss or damage pleaded in par 13(4), or was recklessly indifferent to that consequence.

109 In my opinion, the learned Judge was correct in disallowing par 13.

Paragraph 14 of the proposed statement of claim: should the paragraph have been disallowed?

110 The learned Judge disallowed par 14 on the ground that "if the allegations are true, they represent breaches of duty rather than abuses of power in the sense necessary to establish a claim for misfeasance in public office": at [63].

111 Paragraph 14(1) of the proposed statement of claim pleads the public office held by Mr Lumsden, par 14(2) pleads the impugned conduct, par 14(3) pleads Mr Lumsden's alleged mental state in relation to the impugned conduct, par 14(4) pleads the applicants' alleged loss or damage, and par 14(5) pleads Mr Lumsden's alleged mental state in relation to the alleged loss or damage.

112 Paragraph 14 is similar in structure and content to par 13. I will therefore deal with par 14 in a similar manner to par 13.

113 In par 14(2)(a)(i), the applicants plead that Mr Lumsden "delayed issuing an apology to the Plaintiffs regarding his inappropriate issuing of a defamation threat until two months after he was aware the threat was not in order".

114 In par 14(2)(a)(ii), the applicants plead that Mr Lumsden "refused to seek legal advice on the lawfulness of the waiver of advertising in ODP 106 despite providing the Plaintiff Neilson with specific undertakings in this regard at Council meetings in 2001".

115 Paragraph 14(2)(a) alleges omissions as distinct from acts. The applicants' characterisation of Mr Lumsden's delay and refusal as "an invalid exercise of power or purported exercise of power" is therefore misconceived.

116 In my opinion, the alleged omissions pleaded in par 14(2)(a), in the context of par 14 as a whole, do not disclose a reasonably arguable cause of action. They suffer from defects of the same kind as those referred to in par 89 above in relation to par 13(2)(a).

117 The applicants plead that Mr Lumsden "failed to correct the large numbers of breaches of TPS 9 and denial to the Plaintiffs of natural justice as set out in par 7 of this Statement of Claim".

118 Paragraph 14(2)(b) alleges an omission as distinct from an act. The applicants' characterisation of this failure as "an invalid exercise of power or purported exercise of power" is therefore misconceived.

119 In my opinion, the alleged omission pleaded in par 14(2)(b), in the context of par 14 as a whole, does not disclose a reasonably arguable cause of action. It suffers from defects of the same kind as those referred to in par 89 above in relation to par 13(2)(a).

120 In par 14(2)(c)(i), the applicants plead that Mr Lumsden "failed to behave honestly or communicate accurately" in that on 1 February 1999 he informed the applicants that, on returning from leave, he had considered a report by the Department of Local Government as to the appropriateness of issuing a defamation threat against the applicants, whereas he had considered the report in December 1998, before going on leave.

121 Paragraph 14(2)(c)(i) alleges the making of a false statement.

122 This alleged false statement by Mr Lumsden in relation to his prior conduct does not, in the circumstances pleaded in par 14(2)(c)(i), involve "an exercise or purported exercise of power".

123 In my opinion, the alleged false statement pleaded in par 14(2)(c)(i), in the context of par 14 as a whole, does not disclose a reasonably arguable cause of action.

124 Similarly, in par 14(2)(c)(ii) - (x) the applicants allege, in essence, that Mr Lumsden made various false statements to the applicants or the first applicant on specified dates between 18 April 2001 and 24 October 2001. In particular, it is said that:

(a) On 11 July 2001 Mr Lumsden provided false answers to questions asked by the first applicant at a council meeting on that day;

(b) On 13 June 2001 Mr Lumsden falsely informed the applicants that he had requested clarification "by the Minister's office" in relation to issues raised by the first applicant concerning a second dam on lot 504;

(c) On 13 June 2001 Mr Lumsden falsely informed the applicants that the respondent had not received any complaints regarding clearing on lot 504 "and had no other cause to investigate lot 504";

(d) On 13 June 2001 Mr Lumsden falsely informed the applicants that the respondent had acted in "a timely, honest and diligent manner in its dealings with the Ombudsman's office in relation to lot 504";

(e) On 13 June 2001 Mr Lumsden falsely informed the applicants that "legal advice was being sought and the matter would be referred back to Council for consideration ... in relation to the legality of the waiver of advertising for development applications on lot 504" and on 24 October 2001 Mr Lumsden falsely informed the applicants that "it was expediting legal advice on the legality of waiving advertising requirements for uses approved in ODP 106";

(f) On 13 June 2001 Mr Lumsden falsely informed the applicants that "ODP 106 does not involve a cluster subdivision";

(g) On 13 June 2001 Mr Lumsden falsely informed the applicants that "the proponent of ODP 106 had never intended to seek strata subdivision for each of the chalets [on lot 504]";

(h) On 18 April 2001 Mr Lumsden falsely informed the applicants that "all components of the 12 August 1998 pay fishing proposal were excluded from ODP 106"; and

(i) On 18 April 2001 Mr Lumsden falsely informed the applicants that "no written report was made of the site visit to Lot 504 on 8 July 1998".

125 The false statements were allegedly made more than two years after the respondent approved ODP 106. Accordingly, these statements could not have affected the applicants' enjoyment of lot 341 or decreased the amenity and value of lot 341, as alleged in par 14(4)(c).

126 Further, these alleged false statements by Mr Lumsden in relation to his prior conduct do not, in the circumstances pleaded in par 14(2)(c)(ii) - (x), involve "an exercise or purported exercise of power".

127 In my opinion, the alleged false statements pleaded in par 14(2)(c)(ii) - (x), in the context of par 14 as a whole, do not disclose a reasonably arguable cause of action.

128 Paragraph 14(3) alleges, in essence, that it may be inferred that Mr Lumsden acted "with reckless and contumelious disregard for the Plaintiffs' interest and his lack of power" in consequence of the facts alleged in par 14(2) and the following so-called additional particulars:

"The Plaintiffs provided Cr Gregorini with notice in December 1998 that the proposed ODP 106 was unlawful and as a consequence he threatened not to renew or to terminate the employment contract of Mr Lumsden. Mr Lumsden thereafter harboured malice towards the Plaintiffs."

(a) paragraph 14(2) alleges, in substance, false statements, rather than a "lack of power"; and

(b) the allegation that Mr Lumsden acted "with reckless and contumelious disregard for the Plaintiff's interests and his lack of power" does not (either in itself or in combination with the so-called additional particulars and any other pleas in par 14) remedy the defects in par 14(2).

130 In par 14(4) it is alleged that Mr Lumsden's "action caused damage". The alleged damage is the same as the damage pleaded in par 13(4).

131 In par 14(5) it is alleged that Mr Lumsden was "recklessly indifferent that his acts would cause the loss or harm suffered by the Plaintiffs".

132 In my opinion, par 14(4) and (5) suffer from defects of the same kind as those referred to in par 108 above in relation to par 13(4) and (5).

133 In my opinion, the learned Judge was correct in disallowing par 14.

Paragraph 15 of the proposed statement of claim: should the paragraph have been disallowed?

134 The learned Judge disallowed par 15 on the ground that "if these allegations are true, they would reflect only a breach of duty, not an abuse of power in the relevant sense": at [66].

135 Paragraph 15(1) of the proposed statement of claim pleads the public office held by Mr Stirk, par 15(2) pleads the impugned conduct, par 15(3) pleads Mr Stirk's alleged mental state in relation to the impugned conduct, par 15(4) pleads the applicants' alleged loss or damage, and par 15(5) pleads Mr Stirk's alleged mental state in relation to the alleged loss or damage.

136 Paragraph 15 is similar in structure and content to par 14. I will therefore deal with par 15 in a similar manner to par 14.

137 The applicants allege that Mr Stirk "performed an invalid exercise of power or purported exercise of power" and "failed to behave honestly" in that:

(a) On 18 April 2001 Mr Stirk cooperated with Mr Lumsden in falsely informing the applicants that "no written report was made of his site visit to Lot 504 on 8 July 1998"; and

(b) In June 2001 Mr Stirk falsely informed Mr Lumsden that "he did not advise the plaintiff Neilson that planning staff had advised him that works occurring on Lot 504 on 8 July 1998 were approved".

138 In my opinion, the allegations in par 15(2), in the context of par 15 as a whole, do not disclose a reasonably arguable cause of action. They suffer from defects of the same kind as those referred to in pars 125 and 126 in relation to par 14(2)(c).

139 Paragraph 15(3), (4) and (5) contain allegations in relation to Mr Stirk which are materially in the same terms as the allegations made in par 14(3), (4) and (5) in relation to Mr Lumsden. They suffer from defects of the same kind as those referred to in pars 129 and 132 above in relation to par 14(3), (4) and (5).

140 In my opinion, the learned Judge was correct in disallowing par 15.

Paragraphs 16 and 17 of the proposed statement of claim: ground of appeal

"An action for misfeasance in public office against [the respondent] itself can stand, as the [applicants allege] in pars 16 and 17. ..."

Paragraph 16 of the proposed statement of claim: should the paragraph have been disallowed?

(a) "The Defendant has misfeased in public office in that it committed unlawful acts in abuse of its powers and duties and these acts were performed with knowledge of the lack of power or reckless indifference to the lack of power and the Defendant knew or ought to have known or was recklessly indifferent that these acts would cause the loss or harm suffered by the Plaintiffs in that the Council of the Defendant exercised its planning powers to approve ODP 106 on 10 February 1999 and the act and process of approving ODP 106 was unlawful for the reasons set out in paragraph 7 and the act was performed with reckless indifference to the lack of power as seen by the large number of procedural and technical errors made by the Defendant set out in paragraph 7 ..."; and

(b) "The Defendant must have known or ought to have known that in such circumstances it had no power to act as it did given that the Plaintiffs drew its attention to questions about the unlawfulness of the proposed ODP 106, that the proposed ODP 106 should have been proceeded with cautiously given that such a large tourist resort was without precedent ... and that in granting approval there was a foreseeable risk of harm to the Plaintiffs ... because the effect of the approval would be to reduce the amenity and/or the value of Lot 341."

143 The learned Judge disallowed par 16 on the grounds that:

(a) " ... the defendant does not hold a public office in the sense required to ground liability for misfeasance. As the High Court said in Northern Territory v Mengel ... at p 347:

'So far as policy is concerned, it is to be borne in mind that, although the tort [misfeasance in public office] is the tort of a public officer, he or she is liable personally and, unless there is de facto authority, there will ordinarily only be personal liability.'"; and

(b) "In any event, there is nothing in par 16 which provides a basis for the assertion that the defendant must or ought to have known it had no power to act as it did. Indeed, to the extent that the plaintiffs' case is based on the proposition that the defendant's officers withheld material information from the councillors, that conclusion seems unlikely."

144 In my opinion, the learned Judge was, with respect, in error in holding, in essence, that it was not reasonably arguable that the respondent holds a public office for the purposes of the tort of misfeasance in public office.

145 The respondent is a body corporate with perpetual succession and a common seal. See s 2.5(2) of the Local Government Act 1995 (WA). It has the legislative and executive functions which are described in Pt 3 of that Act.

146 In Dunlop, the Privy Council said at 172:

"Yeldham J rightly accepted that the Council as a statutory corporation exercising local governmental functions was a public officer for the purposes of this tort."

In Jones v Swansea City Council [1990] 1 WLR 1453, Lord Lowry (with whom Lord Griffiths, Lord Ackner and Lord Oliver of Aylmerton agreed) said, at 1458:

"Having regard to Dunlop v Woollahra Municipal Council [1982] AC 158 and the cases mentioned in Wade, Administrative Law, 6th Ed (1988), p.777, I apprehend that a local authority can be sued for misfeasance in a public office ..."

147 In my opinion, the passage from the majority judgment in Mengel, which was cited by the learned Judge, does not indicate that a statutory body corporate such as a local government is not the holder of a public office for the purpose of the tort. In the passage in question, Mason CJ, Dawson, Toohey, Gaudron and McHugh JJ were discussing the circumstances in which a body may be liable vicariously (as distinct from directly) for the misfeasance of its employees. In Mengel, the government inspectors were joined as defendants and the Northern Territory accepted that if the inspectors were liable then it was vicariously liable. Paragraph 16 of the proposed statement of claim alleges that the respondent to the application before this Court is liable directly (and not vicariously) for misfeasance in public office.

148 In my opinion, the learned Judge was, however, correct in deciding that par 16 does not contain adequate material facts from which it may be inferred that the respondent, by its councillors, knew that it was acting beyond power in approving ODP 106 or was reckless to the possibility that it was acting beyond power. Compare Sanders v Snell at 349 - 350.

149 As I mentioned in par 78 above, it is unnecessary, in this application, to determine whether it is reasonably arguable, in the context of proceedings which are analogous to a strike-out application, that it is sufficient for a plaintiff who relies on the second form of the tort, to establish merely that the plaintiffs' loss or damage was reasonably foreseeable. In my opinion, even if such a contention is reasonably arguable, par 16 does not contain adequate material facts from which it may be inferred that the respondent, by its councillors, ought to have known that it was acting beyond power in approving ODP 106.

150 In my opinion, the learned Judge was correct in disallowing par 16.

Paragraph 17 of the proposed statement of claim: should the paragraph have been disallowed?

151 In par 17, the applicants plead that the respondent "misfeased in public office" in that:

(a) at all material times it was the holder of a public office;

(b) it performed an invalid exercise of power or purported exercise of power in that:

(i) its approval of ODP 106 was unlawful, as alleged in par 7 of the proposed statement of claim; and

(ii) it is vicariously liable for the "actions of its staff" as pleaded in pars 13 - 15 of the proposed statement of claim, in that "the actions were performed in the course of, or purported course, of their employment with" the respondent;

(c) it acted with contumelious disregard for the applicants' interests in that "the large number of procedural errors and breaches of TPS 9 set out in paragraph 7 of this Statement of Claim and lies to the Plaintiffs set out in paragraphs 13 to 15 of this Statement of Claim show that the [respondent] was recklessly indifferent to the law and to the interests of the Plaintiffs"; and

(d) the respondent's actions caused damage in that they:

(i) contributed to the second applicant's psychiatric shock; and

(ii) affected the applicants' enjoyment of lot 341 and decreased the amenity and value of lot 341 in consequence of the approval of ODP 106.

"Having regard to the statement made by the High Court in Mengel (supra) that "ordinarily" there will only be personal liability for misfeasance in public office, I have some reservations about the concept of vicarious liability in the present circumstances. However, even assuming (without deciding) that there may be exceptions to the ordinary rule, my conclusion that pars 13 to 15 do not disclose causes of action against the individual officers there identified, must lead in any event to the conclusion that the vicarious liability of the defendant does not arise."

153 His Honour also disallowed par 17 on the following grounds:

(a) " ... nothing is said as to the knowledge of the individual councillors responsible for approving ODP 106" as to the procedural errors and breaches of TPS 9 pleaded in par 7 of the proposed statement of claim (see [76]);

(b) the so-called particulars set out under par 17(3) of the proposed statement of claim "do not ... support an allegation of reckless indifference" (see [77]); and

(c) the other matters relied upon in the additional particulars set out under par 17(3) relate "to post-approval events and are therefore irrelevant" (see [78]).

154 In my opinion, the passage from the majority judgment in Mengel which was referred to by the learned Judge does not indicate doubt as to whether the principles of vicarious liability apply to the tort of misfeasance in public office. The majority referred, in footnote 263, to James v The Commonwealth [1939] HCA 9; (1939) 62 CLR 339 and Racz v Home Office [1994] 2 AC 45. In James, Dixon J said, at 359 - 360:

"But it is important to see that, once there is found a de-facto authority from the Crown in right of the Commonwealth within the scope of which an alleged tort is committed, the doctrine of ultra vires is not used to produce the same immunity as formerly arose from the incompetence of an officer at common law to bind the Crown by his tortious acts."

155 In Racz, Lord Jauncey of Tullichettle (with whom Lord Templeman, Lord Goff of Chieveley, Lord Browne-Wilkinson and Lord Mustill agreed) held, at 50 - 54, that the Home Office could be vicariously liable for the acts of prison officers which constituted misfeasance in public office.

156 In Cubillo v Commonwealth (No 2) [2000] FCA 1084; (2000) 103 FCR 1 at 336 [1088], O'Loughlin J noted:

" ... the Commonwealth will be vicariously liable where the Crown employee was acting within the de facto authority of the Crown: James v Commonwealth [1939] HCA 9; (1939) 62 CLR 339 at 359 -60 and where the employee was impliedly authorised to commit the particular tortious act: Racz v Home Office [1994] 2 AC 45 at 50 - 54."

157 In Three Rivers (No 3), Lord Steyn said, at 191, that:

" ... it is not disputed that the principles of vicarious liability apply as much to misfeasance in public office as to other torts involving malice, knowledge or intention: Racz v Home Office (1994) 2 AC 45."

158 In my opinion, the learned Judge was correct, however, in disallowing par 17 for the reasons he gave.

Paragraph 18 of the proposed statement of claim: ground of appeal

"If any of pars 13 - 17 are allowed, then par 18 should also be allowed. ..."

161 It appears to be intended that this ground should apply also to par 1 of the prayer for relief.

Paragraph 18 of the proposed statement of claim: should the paragraph have been disallowed?

"As a result of the actions complained of in pars 10 to 17, the Plaintiff Loggie suffered psychiatric shock and damage to her sense of community and the Plaintiff Neilson suffered diminution and loss of the companionship of his wife for the period from August 1998 to their divorce in April 2003. Particulars of the Plaintiff Loggie's psychiatric shock will be provided before trial."

163 The learned Judge, at [82], disallowed par 18 on the ground that:

" ... because the statement of claim does not disclose a cause of action, it is not open to the plaintiffs to make the claims pleaded in par 18."

164 The plea in par 18 depends upon the existence of a reasonably arguable cause or causes of action in pars 10 - 17 of the proposed statement of claim. The learned Judge disallowed, relevantly, pars 10 - 17 of the proposed statement of claim (and the applicants have not made application for leave to appeal against the disallowance of pars 10 - 12). In my opinion, his Honour was correct to disallow par 18 for the reasons he gave.

Paragraph 1 of the prayer for relief: notice of contention

166 The respondent, in its notice of contention, asserts, relevantly, that the learned Judge should have held that:

" ... the claim for aggravated or exemplary damages in paragraph 1 of the prayer for relief ... should not be allowed for the reason that there were no allegations pleaded which would support a claim for such damages."

Paragraph 1 of the prayer for relief: should the plea have been disallowed?

167 In par 1 of the prayer for relief the applicants claim:

"General, aggravated and exemplary damages and special damages following on the harm and damage they have suffered because of the [respondent's] actions."

168 The learned Judge, at [84], disallowed par 1 of the prayer for relief on the ground that "there is no basis on which the plaintiffs may properly claim damages".

169 In my opinion, the learned Judge was correct in disallowing par 1 of the prayer for relief in that the underlying causes of action sought to be pleaded in pars 10 - 17 of the proposed statement of claim were not allowed. In the circumstances, there were no causes of action for damages to which par 1 of the prayer for relief could relate.

170 Further and in any event, I am of the opinion that there is merit in the respondent's ground of contention. Order 20 r 9(3) of the Rules of the Supreme Court 1971 (WA) requires that a claim for exemplary damages and a claim for aggravated damages be specifically pleaded together with the facts on which the party pleading relies. Neither par 1 of the prayer for relief nor any other paragraph of the proposed statement of claim pleads the facts relied upon for the claims of exemplary and aggravated damages.

The particulars to par 12 of the proposed statement of claim

171 The applicants, in their amended draft notice of appeal, challenged the learned Judge's decision to disallow the particulars set out under par 12 of the proposed statement of claim.

172 In pars 10 - 12 of the proposed statement of claim the applicants sought to plead causes of action in negligence against the respondent. Paragraphs 10 - 12 were disallowed by the learned Judge and, as I have mentioned, the applicants' application for leave to appeal does not relate to those paragraphs. The particulars set out under par 12 are not referred to in pars 13 - 17, which purport to plead the causes of action for misfeasance in public office. In the circumstances, whether the learned Judge was correct or not to disallow the particulars set out under par 12 does not arise for consideration.

173 If the applicants wish to seek leave to re-plead an arguable cause of action for misfeasance in public office, it will be necessary for the applicants to make application to the Judge who is managing the action in the long causes list. Any such application should be supported by a minute of proposed pleading.

174 It is appropriate, however, that I make some brief observations as to whether the critical allegations in the proposed statement of claim with respect to misfeasance in public office, which were struck out by the learned Judge, are capable of reformulation in a manner which would disclose a reasonable cause of action.

175 In my opinion, on the papers before this Court, the allegations in pars 13(2)(b), (c) and (e), 14, 15 and 16 of the proposed statement of claim, and that part of par 17 which alleges that the respondent is directly liable to the applicants, are not capable of reformulation in a manner which would disclose a reasonable cause of action. In particular, I am of the opinion that the material facts alleged in those paragraphs would not disclose a reasonable cause of action even if they were re-pleaded in accordance with the legal principles set out in these reasons.

176 It is possible, however, that the allegations in par 13(2)(a) and (d) of the proposed statement of claim may be capable of reformulation, in combination with the principles of vicarious liability, in a manner which would disclose a reasonable cause of action. A decision on this point would require careful scrutiny of a minute of proposed pleading. If the minute were to include a new cause of action in respect of which the applicable period of limitation has expired, it would be necessary to consider O 21 r 5(2) and (5) of the Rules of the Supreme Court 1971 (WA).

177 I would grant leave to appeal, but dismiss the appeal.

• The applicants' attempts to plead their case
• Application for leave to appeal
• Principles governing leave to appeal
• Strike-out application - test to be applied
• The proposed statement of claim
• Paragraph 13 - 15 of the proposed statement of claim: the learned Judge's reasons
• Paragraphs 13 - 15 of the proposed statement of claim: ground of appeal
• Paragraphs 13 - 15 of the proposed statement of claim: notice of contention
• The rationale and elements of the tort of misfeasance in public office
• The meaning of "public office"
• The nature of the defendant's conduct
• The state of mind of the defendant
• The plaintiff's standing to sue, including the nature of any duty which must be owed by the defendant to the plaintiff
• The plaintiff's loss or damage, including causation and remoteness
• Paragraph 13 of the proposed statement of claim: should the paragraph have been disallowed?
• Paragraph 13(2)(a)
• Paragraph 13(2)(b)
• Paragraph 13(2)(c)
• Paragraph 13(2)(d)
• Paragraph 13(2)(e)
• Paragraph 13(3)
• Paragraph 13(4) and (5)
• Conclusion in relation to par 13
• Paragraph 14 of the proposed statement of claim: should the paragraph have been disallowed?
• Paragraph 14(2)(a)
• Paragraph 14(2)(b)
• Paragraph 14(2)(c)
• Paragraph 14(3)
• Paragraph 14(4) and (5)
• Conclusion in relation to par 14
• Paragraph 15 of the proposed statement of claim: should the paragraph have been disallowed?
• Paragraph 15(2)
• Paragraph 15(3), (4) and (5)
• Conclusion in relation to par 15
• Paragraphs 16 and 17 of the proposed statement of claim: ground of appeal
• Paragraph 16 of the proposed statement of claim: should the paragraph have been disallowed?
• Conclusion in relation to par 16
• Paragraph 17 of the proposed statement of claim: should the paragraph have been disallowed?
• Conclusion in relation to par 17
• Paragraph 18 of the proposed statement of claim: ground of appeal
• Paragraph 18 of the proposed statement of claim: should the paragraph have been disallowed?
• Conclusion in relation to par 18
• Paragraph 1 of the prayer for relief: notice of contention
• Paragraph 1 of the prayer for relief: should the plea have been disallowed?
• The particulars to par 12 of the proposed statement of claim
• Leave to re-plead
• Conclusion