No 2 Pitt Street Pty Ltd v Wodonga Rural City Council

We would be pleased if you would advise the proposed time and date of that meeting.

On 25 November, Coadys wrote again to the Council asking for information as to when the Council or relevant committee would be meeting to consider the application for the permit, and reiterating that their client wished to be heard in relation to the application.

39. Neither Coadys nor Pitt Street received a reply to either of those letters. The Council determined to reject Pitt Street's objection pursuant to section 57(2A) of the Planning Act, which reads:

(2A) The responsible authority may reject an objection which it considers has been made primarily to secure or maintain a direct or indirect commercial advantage for the objector.

45. The significance of that provision derives from sub-section 57(2B), which reads:

(2B) If an objection has been rejected under sub-section (2A) this Act applies as if the objection had not been made.

The effect of section 57(2B) is that where an objection has been rejected under section 57(2A), the Council is no longer obliged by section 60(1)(a) of the Planning Act to consider the objection, and the person who made the objection is not entitled as of right to apply to the Victorian Civil and Administrative Tribunal ("the Tribunal") under section 82(1) of that Act for review of a decision of a responsible authority to grant the permit. Sections 60 and 82 read, so far as relevant:

60. What matters must a responsible authority consider?

(1) Before deciding on an application, the responsible authority--

(i) all objections and other submissions which it has received and which have not been withdrawn;

(1) an objector may apply to the Tribunal for review of a decision of the responsible authority to grant a permit.

58. The Council issued a permit to Weatheralls on 1 December 1998. It is important to note that it issued a permit under section 63 of the Planning Act, rather than giving a notice of decision to grant a permit under section 64. Those two provisions read, so far as relevant:

Once it has decided in favour of an application, the responsible authority must issue the permit to the applicant if no one has objected or if notice of the decision to grant the permit is not required to be given to objectors under section 64.

(1) The responsible authority must give the applicant and each objector a notice in the prescribed form of its decision to grant a permit.

(3) The responsible authority must not issue the permit to the applicant -

(a) until the end of the period within which an objector may apply to the Tribunal for a review of the decision to grant the permit; or

(b) if an application for review is made within that period, until the application is determined by the Tribunal or withdrawn.

Thus, the issue of a notice of decision to grant a permit enables a person who has objected to the grant to apply to the Tribunal under section 82 for review of the decision to grant the permit. The period within which the application must be made appears from Regulation 27 and Form 6 of the Planning and Environment Regulations 1998 to be 21 days from the giving of the notice. In this case, the effect of the rejection of Pitt Street's objection under section 57(2A) was that by the operation of section 57(2B), Pitt Street's objection was deemed not to have been made, and, assuming the absence of any other objector, the Council was entitled to issue a permit, rather than a notice of decision to grant a permit. The question raised in the writ proceeding as to whether there was in fact any objection on foot at the time of the issue of the permit is not presently relevant.

70. Mr Stevens agreed in cross-examination that his concern about the site at Wodonga Plaza was concern about competition, and that Pitt Street, having reserved the right to supplement its objection, had had every opportunity to put everything it wanted before the Council and had chosen not to do so.

73. The principal ground on which Pitt Street relies in this proceeding is, as set out in paragraph 4 above, the claim that the Council failed to afford Pitt Street natural justice, in that it did not give Pitt Street an adequate or any opportunity to make any submissions, oral or written, to the Council before the decision was made to reject the objection; and it did not give Pitt Street any notice that it proposed to make a decision which adversely affected Pitt Street. Mr Morris, for Pitt Street, indicated at the hearing that he sought to establish only that, in the circumstances of this case, the rules of natural justice required that his client be given the opportunity to make a written submission. All that would have been required, he submitted, was for Pitt Street to be alerted to the possibility that the Council might reject its submission under section 57(2A), and to be given the opportunity to make representations in writing as to why that ought not to take place.

76. Section 3 of the Administrative Law Act confers on a "person affected" by a "decision" of a "tribunal" a right to make an application for review of the decision. Each of those expressions is defined in section 2, set out in paragraph 5 above. Looking at the natural meaning of the words in those definitions and taking into account the matters set out in paragraphs 8 and 9 above, I would have no doubt that the determination of the Council to reject the objection lodged by Pitt Street was a "decision", as defined. Nor can there be any doubt that Pitt Street was a "person affected" in relation to that decision.

79. The issue of whether the Council is a "tribunal" within the definition of that term in section 2 turns on whether "in arriving at the decision in question" - that is, the decision to reject Pitt Street's objection under section 57(2A) of the Planning Act - the Council is "by law required . . . to act in a judicial manner to the extent of observing one or more of the rules of natural justice". In National Companies and Securities Commission v News Corporation Ltd [1984] HCA 29; (1984) 156 CLR 296 at 311-2, Gibbs CJ quoted with approval the following passage from the judgment of Tucker LJ in Russell v Duke of Norfolk [1949] 1 All ER 109 at 118:

The requirements of natural justice must depend on the circumstances of the case, the nature of the inquiry, the rules under which the tribunal is acting, the subject-matter that is being dealt with, and so forth.

The authorities show that natural justice does not require the inflexible application of a fixed body of rules; it requires fairness in all the circumstances, which include the nature of the jurisdiction or power exercised and the statutory provisions governing its exercise. Moreover, as Stephen J said in Salemi v MacKellar [No 2] [1977] HCA 26; (1977) 137 CLR 396 at 444, the rules of natural justice "may also vary from case to case although each be conducted before one and the same tribunal or person".

85. The argument on this issue was conducted on the basis that the relevant rule among the rules of natural justice was the rule requiring that a person be given a reasonable opportunity to present a case before a decision is made against that person. The law was summarised by Batt J in Keller v Bayside City Council [1996] VicRp 23; [1996] 1 VR 356 at 378, where His Honour said:

The law in Australia now is . . . that there is a strong presumption that an administrative or executive decision-maker, the repository of a statutory power, owes a duty to accord procedural fairness, and in particular a "hearing" in some form or other, to any person affected or likely to be affected by the decision, and not merely in respect of a legal or proprietary interest, even though that person is not directly involved in the decision-maker's proceedings; and a clear contrary legislative intent is required to rebut the presumption: Commissioner of Police v Tanos [1958] HCA 6; (1958) 98 CLR 383 at 395-6; FAI Insurances Ltd v Winneke [1982] HCA 26; (1982) 151 CLR 342 at 360; R v Ludeke; Ex parte Customs Officers' Association of Australia [1985] HCA 31; (1985) 155 CLR 513 at 528_; Kioa v West_ [1985] HCA 81; (1985) 159 CLR 550 at 584, 609-12 and 618-19; Haoucher v Minister for Immigration & Ethnic Affairs [1990] HCA 22; (1990) 169 CLR 648 at 651-3 . . . ; and Annetts v McCann [1990] HCA 57; (1990) 170 CLR 596 at 598.

He went on to find that the scheme of the Building Act 1993 manifested a clear intention to exclude an obligation to observe any of the rules of natural justice towards the owners of property adjoining the subject property, and noted at 379 the marked contrast with the rights of adjoining owners under the Planning Act with respect to planning applications.

90. I would, with respect, adopt His Honour's summary of the legal position. In the present matter, the Council, acting as responsible authority in respect of the planning scheme to reject an objection under section 57(2A), was a decision-maker exercising a statutory power. I have already found Pitt Street to be a person affected by the decision to reject the objection. The next question for consideration, therefore, is whether there is a "clear contrary legislative intent" sufficient to rebut the presumption that in exercising that power, the Council was required to afford a hearing to a person who would be affected by the exercise of the power, and thus was, in that respect, a "tribunal" for the purposes of the Administrative Law Act.

93. It should be noted that the nature of the "hearing" required by the presumption may vary according to the circumstances of the case. See for example Heatley v Tasmanian Racing and Gaming Commission [1977] HCA 39; (1977) 137 CLR 487 where Aickin J, with whom Stephen and Mason JJ agreed, having found that a person being warned off racecourses by the respondent pursuant to a statutory power should be "accorded an opportunity of speaking in his own defence", went on to say at 515-6:

This is not to say that the Commission is obliged to adhere to the rules of evidence or conduct formal hearings or to be satisfied according to any stated onus of proof. It is clear that the Commission has an "absolute discretion", in the sense that they may devise their own criteria and no appeal is available against their decision, whether it be mistaken or not. . . . Fairness requires that the person affected should, save in an emergency, be given notice by the Commission of its intention to issue a warning-off notice and of grounds for that proposed action and should be afforded an opportunity to make representations to the Commission on his own behalf, which it must consider before taking action. . . . I do not think that fairness requires in this context an oral hearing though in some circumstances the Commission may well find that it cannot resolve inconsistencies between its information and written submissions from the person concerned without such a hearing. It is however for the Commission itself to devise its own procedures in the light of its obligation to act fairly.

97. In Annetts v McCann [1990] HCA 57; (1990) 170 CLR 596 at 598, Mason CJ, Deane and McHugh JJ cited with approval the passage from Tanos, on which Batt J relied in Keller, in which Dixon CJ and Webb J said that an intention on the part of the legislature to exclude the rules of natural justice was not to be assumed nor spelled out from "indirect references, uncertain inferences or equivocal considerations". Their Honours went on to say:

Nor is such an intention to be inferred from the presence in the statute of rights which are commensurate with some of the rules of natural justice: Baba v Parole Board of New South Wales (1986) 5 NSWLR 338 at 344-5, 347, 349.

101. In Twist v Randwick Municipal Council [1976] HCA 58; (1976) 136 CLR 106 at 109 and following, Barwick CJ said:

The common law rule that a statutory authority having power to affect the rights of a person is bound to hear him before exercising the power is both fundamental and universal: . . . But the legislature may displace the rule and provide for the exercise of such a power without any opportunity being afforded the affected person to oppose its exercise. However, if that is the legislative intention it must be made unambiguously clear. . . . But, if the legislation has made provision for that opportunity to be given to the subject before his person or property is so affected, the court will not be warranted in supplementing the legislation, even if legislative provision is not as full and complete as the court might think appropriate. Thus, if the legislature has addressed itself to the question whether an opportunity should be afforded the citizen to be relevantly heard and has either made it clear that no such opportunity is to be given or has, by its legislation, decided what opportunity should be afforded, the court, being bound by the legislation as much as is the citizen, has no warrant to vary the legislative scheme . . . The court will approach the construction of the statute with a presumption that the legislature does not intend to deny natural justice to the citizen.

In that case, the majority (Barwick CJ and Mason J) found that the existence of a full right of appeal to the District Court as to the facts and the law against the making of an order for demolition showed that the owner of the building did not have a right to be heard by the Council before the order was made.

106. The first submission of Mr Magee, for the Council, was that the Planning Act does demonstrate a clear legislative intent for an opportunity for a hearing to be given to a person whose objection has been rejected under section 57(2A). There was no right to a hearing by the Council before the rejection of the objection, but other opportunities were provided for by sections 82B, 89 and 149B for such a person to receive a hearing from the Tribunal, although under the pain of liability for damages and costs. Those provisions read as follows, so far as relevant:

(1) Any person who is affected may apply to the Tribunal for leave to apply for review of a decision of the responsible authority to grant the permit in any case in which a written objection to the grant of the permit was received by the responsible authority.

(2) Subject to sub-section (3), the Tribunal must give the applicant for the permit, the responsible authority and the affected person an opportunity to be heard before making a decision.

(3) The Tribunal is not required to hold a hearing under sub-section (2) if the applicant for the permit consents to the request for leave to apply for review.

(4) The Tribunal may grant the leave to appeal if it believes it would be just and fair in the circumstances to do so.

(5) If leave is granted by the Tribunal, the person affected may apply to the Tribunal for review of the decision of the responsible authority to grant the permit.

(a) the decision on the application for a permit is exempted from section 82(1); or

(b) a permit has been issued under section 63 in respect of the application for a permit.

(1) Any person who objected or would have been entitled to object to the issue of a permit may ask the Tribunal to cancel or amend the permit if--

(b) the person believes that the person has been adversely affected by--

(i) a material mis-statement or concealment of fact in relation to the application for the permit; or

(ii) any substantial failure to comply with the conditions of the permit; or

(iii) any material mistake in relation to the grant of the permit.

(1) A person may apply to the Tribunal for a declaration concerning--

(a) any matter which may be the subject of an application to the Tribunal under this Act; or

(b) anything done by a responsible authority under this Act.

(2) On an application under sub-section (1), the Tribunal may make any declaration it thinks appropriate in the circumstances.

130. The submission of Mr Magee was that the presence in the Planning Act of sections 82B, 89 and 149B clearly showed that the legislature had considered and made statutory provision for a person whose objection had been rejected under section 57(2A) to be heard, and for the type of hearing to be given. Such a person would be a "person affected", so as to be entitled to make an application under section 82B; would be "a person who objected or would have been entitled to object to the issue of a permit" so as to be entitled to ask the Tribunal for a cancellation or amendment under section 89, on any of the grounds set out in section 87; and would also be entitled, like any other person, to apply for a declaration under section 149B. However, Mr Magee drew attention to the provisions of section 150 relating to compensation, which read, so far as relevant:

(4) If any proceedings are brought before the Tribunal under this Act and the Tribunal is satisfied that--

(a) the proceedings have been brought . . . primarily to secure or maintain a direct or indirect commercial advantage for the person who brought the proceedings; and

(b) any other person has suffered loss or damage as a result of the proceedings--

the Tribunal may order the person who brought the proceedings to pay to that other person an amount assessed by the Tribunal as compensation for the loss or damage and an amount for costs.

(6) The Tribunal may make an order under sub-section (4) whether or not the responsible authority has under section 57 rejected an objection by the person bringing the proceedings on the ground that it was made primarily to secure or maintain a direct or indirect commercial advantage for the objector.

141. Mr Magee's next submission was that the Court should prefer a construction of the legislation that would promote the purpose or object of the provision in question, as required by section 35 of the Interpretation of Legislation Act 1984. For authority as to the purpose or object of the legislation, he referred to the Second Reading Speech by the Minister for Planning on the Bill for the Planning and Environment Amendment Act 1993 ("the Amendment Act") which introduced into the Planning Act a number of provisions, including sub-sections 57(2), (2A) and (2B) (Hansard, Legislative Assembly, page 1794 and following, 11 November 1993). It seems clear from an overview of the Minister's speech that the purpose of the amendments was to render the process of application for permits under planning schemes quicker and more efficient. As to the provisions with which the Court is here concerned, the Minister said:

The Act allows councils to consider significant economic effects of proposed development before making decisions. Clearly this was not intended to mean and does not currently mean that planning schemes may regulate commercial competition. It is important that the Act be strengthened to recognise this well established principle of town planning law so that objectors whose grounds are based on trying to secure or maintain a direct or indirect commercial advantage do not create delay to the disadvantage of applicants.

Clause 14 [which introduced sub-sections 57(2A) and (2B)] provides that a council may reject an objection based on such grounds and clause 26 [which amended section 150(4)(a) and introduced section 150(6)] allows the tribunal to make awards for compensation against a person if proceedings are brought by that person on such grounds. This will help ensure that delays to the granting of permits caused by persons objecting and appealing on these grounds will be cut.

147. Mr Magee submitted that if the Council was obliged to give a hearing to an objector before rejecting the objection under section 57(2A) this would lead to applications for review and appeals, causing delay which was inconsistent with the object of the Amendment Act as shown by the Minister's speech.

150. As to Mr Magee's first submission, set out in paragraph 20 above, Mr Morris submitted that none of the avenues identified by Mr Magee actually afforded the opportunity as of right of a hearing de novo on the merits in the review jurisdiction of the Tribunal against the decision to reject the objection. It could not be said that those rights corresponded to the rights of an objector to the grant of a permit, which rights are lost, as set out in paragraph 9 above, by a decision of the responsible authority to reject an objection under section 57(2A).

153. He submitted that section 82B is very confined, in that an appeal is not available as of right, but only with leave. Further, the section only applies where there has been an objection, and an objection rejected under section 57(2A) is deemed never to have been made_._ Thus if the only objector is a person whose objection has been rejected under section 57(2A), that person has no rights under section 82B. As to the operation of section 89, there is a threshold question as to whether a person whose objection is rejected under section 57(2A) is a "person who objected or would have been entitled to object". In addition, the effect of this provision is limited by section 91(3), which restricts the grounds on which the Tribunal may direct the cancellation or amendment of the permit.

156. As to the submission of Mr Magee, set out in paragraph 23 above, that a finding that the Council was required to give an opportunity to an objector to be heard before rejecting the objection under section 57(2A) would lead to delay, inconsistent with the purpose of the legislation, Mr Morris submitted that the same could be said of limiting such an objector to the rights available under sections 82B, 89 and 149B.

159. Having considered the matter on the basis of the authorities to which I have referred, and taking into account the submissions of Mr Morris, I cannot find that the provisions referred to by Mr Magee demonstrate a clear legislative intent to rebut the presumption that a person who has lodged an objection against the grant of a permit should be given the opportunity to be heard by the Council before it rejects the objection under section 57(2A). They fall very far short, for instance, of the full right of appeal to the District Court in Twist, cited in paragraph 19 above.

162. As to the submission based on the Minister's second reading speech, I would with respect adopt the following passage from the judgment of Winneke P in Masters v McCubbery [1995] VICSC 209; [1996] 1 VR 635 at 646-7. His Honour said of section 35 of the Interpretation Act:

Resort to this section has become almost common place as parties strive to find support for the proposition which they seek to make. In my view the court needs to be careful not to permit recourse to this section to undermine its primary function of seeking to ascertain the intention of the legislation from the content of the Act itself. So commonly is the court asked to refer to the speeches in Hansard, pursuant to the authority given by this section, that it is necessary to keep reminding ourselves of the caution referred to by the court in R v Kean and Mills [1985] VicRp 21; [1985] VR 255 at 259:

We were urged to refer to the Attorney-General's second reading speech in the Legislative Council on the Bill ... It was said that we were entitled to do so pursuant to s35(1) of the Interpretation of Legislation Act 1984. It is unnecessary to attempt the interpretation of that section. It is sufficient to say that apparently the Court is not obliged to refer to the Minister's speech. It "may" do so. The criteria for the exercise of such a power seems, however, not to be specified.

For my own part I think it is unhelpful for the court to resort to the power provided by the section in a case like this when the court is being asked to look at the "scheme" of a statute to determine whether that "scheme" demonstrates a manifest intention to deprive a statutory tribunal of a duty to act with fairness in the exercise of its powers. It can be conceded that this Act, through its stated objectives, can be seen to be intending to provide dispute resolution procedures which are "cost effective". What cannot be gleaned by reading the Act as a whole in my opinion is an intention or objective to absolve medical panels from a duty to act fairly in carrying out their functions. Indeed, in the same speech to which we were referred, the Minister stated that "Decision making on disputes will be consistent and fair".

168. Accordingly, I find that the Council, in deciding whether to reject under section 57(2A) an objection to the grant of a permit, is bound to act fairly towards the objector, to the extent of granting the objector an opportunity to be heard before the decision is made. Two results follow from that finding. First, the Council is, in this context, a "tribunal" for the purposes of the Administrative Law Act, and the objector is entitled to have the decision to reject the objection under section 57(2A) reviewed in accordance with that Act. Second, the Council being bound to give Pitt Street an opportunity to be heard, the question then is whether the Council did grant Pitt Street such an opportunity.

171. The Council has already admitted, in paragraph 25 of its Defence, that it did not give Pitt Street a hearing in relation to the rejection of its objection. The concessions of Mr Stevens which were extracted in cross-examination, as set out in paragraph 11 above, do not determine the question as to whether Council performed its duty to grant to Pitt Street an opportunity to be heard.

174. Mr Morris submitted that it was clearly not the intention of the legislation to shut out absolutely objections based on commercial considerations. He referred to the first of the two paragraphs from the Minister's speech which are set out in paragraph 22 above. He submitted that the acknowledgment by the Minister that the Planning Act allowed councils to consider significant economic effects of proposed developments was a recognition of the effect of section 4(1A), which states that one of the objectives of planning in Victoria is to provide for the fair, orderly, economic and sustainable use, and development of land; of section 12(2)(c), which empowers a planning authority, in preparing a planning scheme, to take into account its social effects and economic effects; and, most relevantly, of section 60(1)(b)(i), permitting the responsible authority, before deciding on an application, to consider any significant social and economic effects of the use or development for which the application is made.

177. He referred to the judgment of Stephen J in Kentucky Fried Chicken Pty Ltd v Gantidis [1979] HCA 20; (1979) 140 CLR 675 at 687 where His Honour said:

If the shopping facilities presently enjoyed by a community or planned for it in the future are put in jeopardy by some proposed development, whether that jeopardy be due to physical or financial causes, and if the resultant community detriment will not be made good by the proposed development itself, that appears to me to be a consideration proper to be taken into account as a matter of town planning. It does not cease to be so because the profitability of individual existing businesses are at one and the same time also threatened by the new competition afforded by that new development. However the mere threat of competition to existing businesses, if not accompanied by a prospect of a resultant overall adverse effect upon the extent and adequacy of facilities available to the local community if the development be proceeded with, will not be a relevant town planning consideration.

He submitted that that principle did not apply, for example, to an operation such as a service station, of which there would always be a number in a given area, and a particular planning decision was unlikely to affect the adequacy of the facilities available to the community. However, it was relevant when dealing with a development such as a regional shopping centre, or a cinema centre, when there was only room for a very few players in the market place. Thus the Planning Act could not be said to intend an absolute prohibition on objections based primarily upon commercial considerations. After all, he submitted, a number of planning objections are made primarily for what are effectively commercial reasons, given the effect on land values of many planning decisions.

182. Mr Morris submitted that while the objection made by Coadys on 13 November 1998 set out what was required by section 57(2) to be included in an objection, it did no more than that. In particular, it did not canvass the motivation of the objection, which was the ground for the Council's rejection of it. Pitt Street was given no opportunity to reply to the finding of the Council that the objection was "made primarily to secure or maintain a direct or indirect commercial advantage for the objector" in terms of section 57(2A). Parliament had deliberately not laid down a blanket rule that all objections made "primarily to secure or maintain a direct or indirect commercial advantage for the objector", in terms of section 57(2A), ought to be rejected. Rather, it had vested a responsible authority with a discretion to reject an objection which it considered had been made on that ground. The Council had a discretion to exercise, and the objector should be entitled to put to the Council arguments as to the exercise of that discretion. I accept the submissions of Mr Morris set out in this and the two preceding paragraphs.

185. Mr Morris relied on Romanella v City of Melbourne (1986) 62 LGRA 327. In that case, the Council as responsible authority had refused the plaintiffs an extension of a time limit on their planning permission. Murphy J found that there was no statutory right of appeal against that refusal to the Planning Appeals Board (a predecessor of the Tribunal). However, he went on to say at 330:

The council had a duty to act fairly towards the applicants. This may not have required them to provide an oral hearing to the applicants, but at least the applicants should have been made aware of what was being urged against the grant of the extension and given the opportunity to counter, if they could, any such matters.

189. I would, with respect, adopt that statement. Adapting it to the present case, the duty of the Council to act fairly did not require it to provide an oral hearing to Pitt Street. But, as an objector, Pitt Street should at least have been made aware of what was being urged against it, namely that the Council was proposing to reject its objection under section 57(2A), and should have been given the opportunity to counter that matter, if it could. It was not made aware of what the Council proposed, and it was given no opportunity to make submissions on that or any other matter.

192. It is a significant fact in the present case that Coadys, acting for Pitt Street, twice asked the Council to notify it of the date when the decision would be made. They were entitled to expect, from a body such as the Council, an answer to those two requests, which would have given them a deadline as to when any submission was to be made. The giving of a reasonable deadline would have been their opportunity. By being denied such a deadline, they were not given an opportunity. A body which is bound to give a person an opportunity to make submissions before making a decision must, at the very least, notify that person of a reasonable time within which submissions must be made if they are to be considered before the making of the decision.

196. Accordingly, I find that the Council, in rejecting the objection lodged by Pitt Street, failed to accord Pitt Street natural justice, and accordingly ground (a) of the order for review is made out. It is therefore not necessary to consider the other grounds. The submission of Mr Morris was that, should I reach that finding, there should be an order quashing the decision of the Council to reject the objection of Pitt Street, in accordance with the order for review, with a consequential order directing the amendment of the permit to a notice of decision to grant a permit, effective on the date of the making of the orders, which would then afford Pitt Street 21 days within which to apply to the Tribunal for a review of that decision. I did not understand Mr Magee to join issue on that submission.

199. It would be my intention that there should be an order in those terms. However, I am not to be taken as making any orders today. I propose shortly to fix a time, as soon as possible, for counsel to make submissions as to the appropriate orders to be made in both proceedings in the light of my findings. There will, no doubt, need to be submissions as to costs.