Sydney, 1972, April 13, 17; November 24. 24:11:1972

BARWICK C.J. Section 121 of the Local Government Act, 1919 (N.S.W.) (the rate. The section is in the following terms:

"121. (1) For or towards defraying the expenses of

executing any work or service or for or towards repaying with

interest any advance made by the Minister or debt incurred

or loan raised in connection with the execution of any work

or service where, in either case, such work or service in the

opinion of the council would be of special benefit to a portion

of its area to be defined as prescribed, the council of a

municipality or shire may make and levy a local rate on the

unimproved capital value or on the improved capital value

of ratable land within such portion.

(1A) For or towards meeting any liability transferred to

the council of a municipality or shire consequently upon the

alteration of the boundaries of the area, the council may make

and levy a local rate on the unimproved capital value or on

the improved capital value of the ratable land added to the

area.

(2) The council of a municipality or shire may by notice

in the Gazette from time to time define part of the area to be

known as a 'town improvement district' within which a

'town improvement local rate' may be levied under the

provisions of this section." (at p308)

2. On 22nd July 1968 the Council of the City of Parramatta (the Council) purported to exercise the power given by s. 121 (1). It resolved:

"That a Local Rate of one (1) cent in the $ on the

Unimproved Capital Value be made and levied for the year

1968 on all rateable land in the portion of Dundas Ward

described in the Schedule annexed hereto, the proceeds of such

rate to be used for or towards defraying the expenses of the

construction of roads, kerbing and guttering, concrete footpaths,

drainage and the general embellishment of the area,

such works and services being in the opinion of the Council

of special benefit to such portion of the area and that such be

known as the Rydalmere Industrial Area Local Rate."

The schedule annexed to the minute of the resolution described a large area, being part of the Dundas Ward of the local government area of the appellant Council, by metes and bounds but excluded out of the described area some ninety specified lots. By following the boundaries of the majority of these excluded lots where they impinge upon the line drawn according to the described metes and bounds, an external boundary of a portion could be identified, though not by metes and bounds in the sense in which I think that expression is used in the relevant regulations made under the Act to which I will later refer. But even if that exercise were carried out there would remain a number of excluded lots which would form islands within the external boundary so constructed. (at p309)

3. The work to be done toward the cost of which the local rate was to be devoted consisted of "the construction of roads, kerbing and guttering, concrete footpaths, drainage, and for general embellishment of the area". The excluded lots, with some exceptions, carried old cottages of cheap construction in a dilapidated condition occupied by, in some instances, owners and, in others, by tenants. It was said that the cottages appeared to be in that transitional stage encountered in an old residential area which is changing to become an industrial area. For the rest, the described area was land in an industrial area in which a great part of the land was in actual industrial use. (at p309)

4. A local rate in respect of the same area was similarly struck for the year 1969. (at p309)

5. The respondent occupied a cottage on a lot in the specified area (that is, that remaining after excluding the ninety lots) in a street in which some lots were excluded from the part to be rated but his was not. He carried on for his own recreation a home workshop at the rear of his house and was not in fact making any industrial use of his land. The lot next door to him was excluded as was a block on the other side of the street opposite to him. (at p310)

6. The respondent, on 24th October 1969, sued the Council in the Supreme Court of New South Wales in Equity seeking declarations that the resolutions levying the local rate in each of the years 1968 and 1969 and the rate notices served on the respondent notifying amongst other things the amount of the local rate levied in respect of his property in accordance with those resolutions were invalid and void and also seeking an injunction to restrain the Council from taking proceedings to enforce payment of the rates purported to be imposed by the said resolutions. (at p310)

7. The Supreme Court was of opinion that the resolutions were invalid and void and so declared (1971) 23 LGRA 78 . The Council now appeals to this Court against the declarations and orders made in the suit. The learned Supreme Court judge who heard the suit and made the declarations and orders did so for two reasons. First, he was of opinion that the land specified by the Council to be subject to the local rate was not reasonably capable of being related to the special benefit to be conferred by the works or services towards the cost of which the proceeds of the local rate were to be devoted, because, having regard to the nature of the included and the excluded lots and the works and services to be done and provided, they were not reasonably capable of being regarded in a single opinion as respectively likely to enjoy and not to enjoy a special benefit from those works and services. He was also of opinion that in making its resolution the Council was pursuing an inadmissible purpose in that the exclusion of the occupied cottages from the area described by metes and bounds was intended to give effect to an extraneous consideration in relation to the imposition of a local rate, namely, that the owners of the occupied cottages because of the personal situations implicit in the use of their land were deserving of special immunity from liability to pay the local rate. (at p310)

8. Section 121 requires the portion thought by the council to specially benefit from the execution of the proposed works and services to be described in a prescribed manner. The prescribed manner of defining such a portion is to be found in reg. 28 1/2 (b) of Ordinance 5 made under the provisions of the Act. The relevant part of the regulation provides that if the portion of the area in respect of which the local rate is to be levied is "less than a complete ward, riding, urban area, town improvement district or fire district", it shall be defined "by metes and bounds". It would appear that on any view the portion of the Council's area within which the local rate was to be levied according to the resolutions did comprise less than a complete ward and was not a riding, urban area, town improvement district or fire district. The prescribed manner of defining the portion of the area for the purposes of s. 121 (1) was thus a description "by metes and bounds". In my opinion, this calls for a description in words, starting from some identifiable datum point, of the external dimensions of the boundary of the portion as a continuous line from and to the point of commencement in respect of which the local rate is to apply. In my opinion, the effect of the exclusion of lots decided on by numbers on a plan was to deny the Council's definition of the portion the quality of a definition "by metes and bounds". Thus, the description did not satisfy the requirements of the regulation. (at p311)

9. No point, however, was taken before the Supreme Court or in argument before us that the description of the portion in the schedule to the Council's resolutions imposing the local rate was inadequate to satisfy the provisions of s. 121 (1) when read with the regulation to which I have referred. (at p311)

10. But though the point was not expressly taken, it seems to me that it was the failure to describe by metes and bounds the portion of the area to which the local rate was to apply that has given rise to at least some of the difficulties that have arisen in the case. As I have said, it may be possible to construct a perimeter of a portion of the area by having regard only to some of the excluded lots, thus placing them beyond the external boundary of the portion. But there would remain other excluded lots with none of their boundaries in contact with that perimeter at any point. They would form islands, as it were, within the portion thus constructed. Perhaps, if one had available the description by metes and bounds of all the excluded lots, it might be possible to construct a description by metes and bounds of the perimeter I have thus described. But if the title to any of those lots is held under the Real Property Act, 1900-1967 (N.S.W.) it is unlikely that a description of such lots by metes and bounds would be available. Such lots are usually described by reference to a deposited plan. Thus, it is far from certain that, even if such a course is warranted which I do not think it is, a description by metes and bounds of that portion could be constructed. But it would not have been so described by the Council. Further, in any case, the "island" lots would remain to deny the possibility of describing by metes and bounds the portion determined by the Council as the relevant portion of its area. (at p312)

11. Thus, in my opinion, the resolutions failed to comply with the statutory requirements. I realize that the construction I place upon the regulation may make it difficult for local government bodies on some occasions to define the portions of their areas for local rating purposes. The identification of land by reference to lot numbers upon a plan, as is common in conveyancing these days, might well be thought quite adequate for the relevant purposes: and, indeed, much more informative to the ratepayers who may be affected. The situation may need to be remedied by suitable changes in the regulation prescribing the method of defining the portions to be rated. (at p312)

12. I turn, however, to consider whether the reasons given by the Supreme Court are, as claimed by the appellant, erroneous. A question which arises at the threshold is the meaning of s. 121 itself. It seems to me that the Supreme Court has entertained the view that that section means that the council must include in the portion of its area which it defines all land within its area which it ought to consider would derive more benefit than would the balance of the land in its area from the execution of the proposed works or services. The view taken appears to have been that, upon the evidence before the Court, the advantage to be derived from the execution of these works and services must have been regarded as the same for all the land within the area described by metes and bounds, that is to say, for the excluded lots equally with the land included in the portion fixed by the Council's resolution. Therefore, though perhaps not so expressed, the conclusion seems to have been that the exclusion of some parcels must mean that the Council did not hold an opinion that the portion of its area identified by its description was the only portion of its area which would derive special benefit from its execution of the works or services. Logically this would mean that had there been a description by metes and bounds of a portion without any exclusions and it was so clearly established that land outside the described portion did in fact derive the like benefit from the works or services as the land in the portion that no reasonable mind could think that the land outside the portion did not receive such a special benefit, the local rate levied in respect of the portion would have been invalid and void. The described portion would not include all the land in the area which ought to be regarded as deriving special benefit. (at p312)

13. The other view of the section is that the rate will be valid if the council is of opinion that the works or services will be of special benefit to the portion which the council selects and describes, though that may not be all the land in the area which may derive, or might be thought to derive, special benefit from the performance of the works or services. (at p313)

14. In this connexion, the meaning of special benefit must be resolved. It may mean a benefit which no other land in the council's area would enjoy: or it may mean a benefit which is not necessarily enjoyed by all the land in the local government area. I prefer the latter view which, to my mind, is more consonant with the scheme of local government rating which the Act contains. In my opinion, a portion may derive special benefit from the execution of works or services though it is not the only part of the local government area which does obtain that benefit therefrom. In other words, the special benefit of which the section speaks is a benefit which some other parts of the area may not enjoy, a benefit particular to the land selected though not exclusively so. The concept of special benefit in connexion with local government works and services is somewhat nebulous. The nature of a special benefit, as well as the choice of a portion to be subject to a local rate, are both matters apt to be committed to the opinion of the local government authority. In this connexion, it must be borne in mind that the council is a representative body of limited tenure of office. The question whether or not the given works or services are of special benefit to a portion of the local government area is very much a matter of opinion probably involving many imponderables and a great deal of local knowledge. The purpose of the legislature in committing the selection of the portion in respect of which a local rate is to be levied to the opinion of the local council reflects such considerations. On the other hand, it is no doubt contemplated that the burden of a local rate should be distributed over all the land which might reasonably be thought especially to benefit by the performance of the works or the rendering of the services. But the selection of the land to carry that burden is left, in my opinion, to the opinion of the local government body. But, of course, the council must in fact have the necessary opinion that the portion it has chosen will derive special benefit. Whether or not it in fact holds the opinion may be challenged in the courts; but, if the necessary opinion is in fact held, the correctness of the council's view in selecting the portion cannot be reviewed by the courts. (at p313)

15. The proper construction of s. 121 (1), in my opinion, is that the council may levy a local rate in respect of land in a portion of its area if it is of opinion that the works or services to the execution of which the proceeds of that rate are to be devoted will be of special benefit to the portion chosen by it. It therefore seems to me that if a council in fact holds the opinion that the portion of its area in respect of which it decides to impose a local rate will derive special benefit from the execution of the works or services to which the proceeds of the local rate are to be devoted, the rate resulting from its resolution in that behalf will be valid, thought it might reasonably be thought that other land in the council's area would derive equal benefit from the execution of those works or services. (at p314)

16. But, in this case, some of the excluded lots or parcels form islands surrounded by land subjected to the local rate. Quite apart from the difficulty of satisfying the statutory requirement of description of the portion by metes and bounds, I have come to share the Supreme Court's view that, bearing in mind the nature of the proposed works or services, no rational basis could exist for holding at the same time an opinion that the land surrounding these island lots would derive a special benefit from the execution of those works and services and the opinion that those island lots would not. There will doubtless be cases in which, because of the nature of the works and services, or of other physical features of the location or surroundings, adjacent lots may reasonably be considered not to derive the like benefit from proposed works or services. In such a case, the exclusion of an "island" lot in a portion, provided it is appropriately described, may not found a conclusion adverse to the validity of a local rate. But here there are no circumstances which, in my opinion, could reasonably warrant the view that adjacent lots in the portion specified by the Council derived a different benefit from the execution of the works or the rendering of the services. (at p314)

17. We were pressed in argument with the view that the time at which the works were executed and the services rendered was itself the source of special benefit to the portions chosen by the Council but not to the excluded lots. The argument was that the industrial area would benefit by the early performance of the proposed works which, but for the industrial use being or likely to be made of land in the specified portion, need not and would not have been done at the time they were proposed to be done. But, persuasive as the argument was, in my opinion, it is not acceptable. The performance of the works in this case will, in my opinion, benefit the lands in question whenever performed: no more or no less because done at one time rather than at another. It may be considered that the lack of the works or services may be more disadvantageous to the industrially employed land. But that does not mean, in my opinion, that the same benefit to all the land in an area will not be a special benefit to all that land. (at p315)

18. Further, the discrimen of exclusion of the excluded lots, which seems to have been adopted by the Council, strongly suggests that the Council entertained an erroneous view as to what might constitute special benefit. It was the use being made of the excluded lots and the circumstances of those who were using that land which formed the basis of the decision to exclude. It is the land which is to be considered as deriving a special benefit from the execution of the works, not the owner of the land. No doubt that benefit must result in the availability to the owner of some advantage such as accessibility or accretion in value. But though the use to which the land is presently devoted may in some circumstances emphasize that advantage, that use can scarcely be the determinant as to whether or not land will derive special benefit from works or services such as were here in contemplation. Certainly the circumstances of the users could not in this case form part of the formation of an opinion as to special benefit to be derived by the land. Thus, I would regard the basis of the Council's exclusion of the excluded lots and parcels as cumulating with the difficulties I have mentioned with respect to the "island" lots or parcels to require the conclusion that the Council did not in fact hold the requisite opinion to satisfy s. 121 (1). Whatever opinion the Council held could not have been the opinion as required by the statute. Consequently the resolutions of the Council levying the local rate lacked the necessary statutory basis. They were ineffective to impose the rate and do not justify the rate notices. (at p315)

19. I should add that I do not share the opinion of the Supreme Court that this is a case in which the motive or purpose of the council in selecting the portion is an independent ground of invalidity. As appears from what I have written, the basis of selection of the excluded lots is an element in concluding that the Council did not in fact hold the opinion required by the section as the basis of the resolution to levy the local rate. (at p315)

20. In my opinion, for these reasons, the appeal should be dismissed. (at p315)

McTIERNAN J. In my opinion this appeal should be allowed. (at p316)

2. The appellant is the council of a city, which is a local government area under the Local Government Act, 1919 (N.S.W.). Section 84 provides as follows: "For the purposes and subject to the provisions of this Act each council shall be charged with the local government of its area, and shall have the general control of the working and business of such local government". Section 23 (1) provides that each city council shall consist of aldermen elected by electors (qualified under this Act). Section 11 (4) provides that: "All the provisions of this Act which apply to a municipality shall apply to a city". Section 117 provides that: "Rates levied by a council may be of four kinds ..." One kind is "Local Rates". Section 121 (1) provides as follows:

"For or towards defraying the expenses of executing any

work or service or for or towards repaying with interest any

advance made by the Minister or debt incurred or loan raised

in connection with the execution of any work or service where,

in either case, such work or service in the opinion of the

council would be of special benefit to a portion of its area to

be defined as prescribed, the council of a municipality or shire

may make and levy a local rate on the unimproved capital

value or on the improved capital value of ratable land

within such portion."

The making and levying of a local rate is an exercise of the power of local government with which the council is charged by s. 84. The formation of an opinion pursuant to s. 121 (1) is an exercise of such power. The procedure for making and levying rates is governed by ss. 138 and 139. Under sub-s. (2) of the latter section, every rate shall be made by resolution of the council, and be levied by service of a rate notice. The appellant complied with those provisions in making and levying the local rates at present in question. The resolutions by which they were made depended on s. 121 (1). It is convenient to me, and, I think, sufficient for the purpose of determining this appeal, to consider the resolution of the Council, carried at a meeting of the Council, to give effect to the proposal, evidenced by the Council's documents, to make and levy the first of these rates. This was for the year 1968. The terms of the resolution are as follows: "That a Local Rate of one (1) cent in the $ on the Unimproved Capital Value be made and levied for the year 1968, on all rateable land in the portion of Dundas Ward described in the Schedule annexed hereto, the proceeds of such rate to be used for or towards defraying the expenses of the construction of roads, kerbing and guttering, concrete footpaths, drainage and the general embellishment of the area, such works and services being in the opinion of the Council of special benefit to such portion of the area and that such be known as the Rydalmere Industrial Area Local Rate". (at p317)

3. The claim of the plaintiff is that the Council was not competent to form the opinion expressed in this resolution in relation to the portion described in the schedule and the resolution was therefore not effective to make and levy the local rate, as intended by the Council. The works mentioned in the resolution were to be carried out at certain locations in streets within the Rydalmere Industrial Area. The metes and bounds enumerated in the schedule annexed to the resolution define an area extensive enough to include all those locations. (The word "road" in the Act includes "street": s. 4.) The area inside the metes and bounds was zoned for industrial use. A long stretch of a street called Victoria Road is the northern boundary of such area. The buildings and premises fronting the streets within the area are, in the main, factories and other industrial premises. There are also some houses used as homes in the area. Their number is small. It appears that these houses were built before the land was zoned. Because the metes and bounds enumerated in the schedule were designed to encompass the locations where the work referred to in the resolution was to be carried out the land defined in outline by the schedule included the land used, or waiting to be used, for industrial purposes and also the much lesser area of land occupied by the dwelling-houses. The latter did not form a continuous frontage to any street. They were to be found here and there within the area. In the section of Victoria Road, which is its northern boundary, there are two such houses, east of Subiaco Creek and two more west of the creek. The plan of the area does not enable one to say that work done in locations in streets on the eastern side of the creek would be of real advantage to any dwelling-house in the south-western locality of the area, or vice versa. In the locality where the western and southern sides of the area meet there appear to be only two dwelling-houses, each of which is in a different street. (at p317)

4. The Council decided not to impose the local rate on any of the lots of land in the area occupied by the dwelling-houses. The schedule describing the land on which the resolution operated to impose the rate, was expressed to exclude those lots individually from the portion of the Council's area intended to be rated by operation of the resolution. The metes and bounds enumerated in the schedule defined the portion to be rated subject to the exclusion of these lots individually. These are referred to in the schedule by their respective street numbers. (at p317)

5. The relevant Ordinance prescribes in effect that the portion of the council's area, contemplated by s. 121 (1), should be defined by metes and bounds. In my opinion the schedule as drafted for the purpose of the Council's resolution is a suitable compliance with the Ordinance. The intention of the Ordinance is that the limits of the portion, contemplated by s. 121 (1), are to be settled by describing its metes and bounds. The excluded lots are each described in the schedule by a street number in order to make clear the outline of the "portion" resulting from the exclusion of those lots from the area inside the metes and bounds. If the manner of defining the "portion" adopted in the schedule is not a compliance in every respect with the Ordinance, the irregularity does not avoid the resolution of the Council: Clayton v. Heffron [1960] HCA 92; (1960) 105 CLR 214, at pp 247-248 . (at p318)

6. The need for carrying out the work which each one of the local rates was made and levied to pay for, may be presumed to have been occasioned by the intense development of the area - the building of factories, and the growth of traffic resulting from the industrial activities in the area - rather than to the continuing residential use of some parcels of land. It seems to me that it is clearly an open question - to say the least of it - whether or not the special benefit of the works referred to would, as a practical matter of fact, accrue substantially to the land already used or waiting to be used for industrial purposes, rather than to the whole area including the lots occupied by dwelling-houses. The opinion of the Council on the question cannot be correctly described as not legitimate or grossly unreasonable or as a misuse of the discretion given by s. 121 (1). An opinion of a council arrived at for the purposes of s. 121 (1) is not subject to an appeal to a court. In a proceeding for a judicial review of such an opinion, it is not for the Court to impose its own idea of what a council ought to have decided. The question on such a review is not whether the opinion is correct or mistaken in fact. The only question is whether the Council was authorized by s. 121 (1) to use the opinion in making a rate under the sub-section. It seems to me clear, that the Council was authorized to form an opinion whether the work would be of special benefit to the portion as defined by the schedule. It was not necessary under s. 121 (1) to form the opinion in respect of the whole area inside the metes and bounds described in the schedule, or in respect of any land outside those metes and bounds within the immediate vicinity. The question what area of land gets a special benefit from any given work or service is intended by the Act to rest on the opinion of the Council, it being the local government of the area. I do not think that in exercising its discretion to determine what portion of the area would be specially benefited by the works in question that the Council was obliged as a matter of law to include all the parcels of land occupied by dwelling-houses. (at p319)

7. I therefore decide that neither the rate for the year 1968 nor the rate for the following year was invalidly made or levied. (at p319)

MENZIES J. The facts of this matter have been clearly and concisely stated by Street J. in the judgment against which this appeal is brought by special leave. His Honour stated them as follows:

"The plaintiff in this suit is the owner of a parcel of land

within the City of Parramatta. He challenges the validity of

the action of the Council of the City of Parramatta in making

and levying upon his land a local rate for the years 1968 and

Within the city is a relatively large area known as the

Rydalmere Industrial Area. Although described in this

manner, and presumably destined ultimately for industrial

use exclusively, there was within this area in the years in

question an appreciable number of small suburban allotments

(including the plaintiff's) upon which were erected individual

dwelling houses.

Early in 1968 consideration was given by the Dundas Ward

Committee of the Council (the Rydalmere Industrial Area

being within this Ward) to the carrying out of certain roadworks

together with kerbing and guttering, footpath and

drainage work in the Rydalmere Industrial Area. The report

of the meeting of the Dundas Ward Committee on 9th April

1968, to the council includes an item:

'Rydalmere Industrial Area Local Rate - South of Victoria

Road.

Recommendation: That in an endeavour to raise $160,000

over three years, for urgent works in this area a local rate

of one cent in the dollar be made and the Town Clerk

prepare a Schedule by metes and bounds to exclude as

many occupied cottages as practicable.'

This report was received and adopted at the council meeting

on 16th April 1968.

On 11th July 1968, pursuant to s. 138 of the Local Government

Act, estimates of the income and expenditure referable

to that rate were advertised. This was done pursuant to a

council resolution of 8th July 1968. The introductory portion

of the advertisement is as follows:

'Rydalmere Industrial Area Local Fund

(a) Amount of proposed additional expenditure for or

towards defraying the expenses of the construction of

roads, kerbing and guttering, concrete footpaths, drainage,

and for general embellishment of the area, such

work or service being in the opinion of the Council of

special benefit to such portion of the area -

(b) The amount required to be raised by rates for such

expenditure is $44,697.

(c) The total estimated Unimproved Capital Value within

the area is $4,529,692.

It is proposed to raise the required amount by making and

levying a local rate of 1 cent in the dollar on the unimproved

capital value of all rateable land in the portion of Rydalmere

described in the Schedule hereunder -'

The schedule contained in the advertisement described by

metes and bounds a relatively large area, and concluded:

'Excluding out of the area above described Lots 370 and

371 Deposited Plan 14244 and also the following land and

premises Numbers 5, 7 and 9 Alan Street, numbers 43, 45,

47, 49, 51 and 53 Brodie Street, numbers 1, 2, 4, and 6,

numbers 8 to 13 inclusive, numbers 15 to 18 inclusive and

number 21 Muriel Avenue, numbers 2, 4, 5, 7, 9 and 11,

numbers 13 to 16 inclusive, numbers 18, 19 and 20, numbers

22 to 27 inclusive, numbers 30 to 34 inclusive and numbers

36 and 43 Mary Parade, numbers 4 to 6 inclusive, numbers 8

and 11, numbers 13 to 24 inclusive, and numbers 28, 30, 34

and 36 Bridge Street, numbers 2, 3, 4, 6, 8, 13, 15 and 17

Clyde Street, numbers 5, 9 and 17 Euston Street, number 50

Antoine Street, number 92 South Street and numbers 221,

223, 271 and 273 Victoria Road.'

The evidence indicates that the great majority of the ninety

specifically excluded parcels of land were "occupied cottages"

most of them being some twenty to thirty years old, of cheap

construction, and presenting a dilapidated appearance. The

cottages were described as presenting the appearance of

requiring maintenance and being in a transitional stage such

as is at times encountered in a residential area the general

nature of which is changing to an industrial area.

On 22nd July 1968, the minutes of the Council record the

following:

'- NOTICE OF MOTION -

29711. Rydalmere Industrial Area Local Rate

Resolved on the motion of His Worship the Mayor:

That a Local Rate of one (1) cent in the $ on the Unimproved

Capital Value be made and levied for the year 1968 on all

rateable land in the portion of Dundas Ward described in the

Schedule annexed hereto, the proceeds of such rate to be

used for or towards defraying the expenses of the construction

of roads, kerbing and guttering, concrete footpaths, drainage

and the general embellishment of the area, such works and

services being in the opinion of the Council of special benefit

to such portion of the area and that such be known as the

Rydalmere Industrial Area Local Rate.'

The schedule annexed to these minutes is the same schedule

as that which was advertised, including the final paragraph

exempting the ninety specified parcels in the terms that I

have quoted above.

The plaintiff's land, No. 41 Mary Parade, although being

an occupied cottage, was not within the specified parcels of

land exempted from the area. Why his land was not exempted

is a matter of speculation; it is suggested that the fact that

he carried on for his own recreation a home workshop at the

rear of his house may have presented a superficial appearance

that he was making some industrial use of his land. The land

next door to the plaintiff on one side was excluded, as was a

block almost opposite on the other side of the road.

The plaintiff protested to the Council by letter, and did not

make payment of the 1968 local rate until threatened with

legal action. He then paid that rate under protest. In answering

his protest, the Council, by letter signed by the Town Clerk,

informed him that

'the rate was levied so that improvement works in that

particular area can be carried out. All moneys collected in

respect of this local rate must be spent in the area for which

the rate was levied.'

In the year 1969 the Dundas Ward Committee again

recommended the imposition of a local rate. The recommendation,

as recorded in its report of 31st March 1969, was:

'Recommendation: That a local rate of one cent in the

dollar be made in the same area as in 1968 with the exception

of 32 Bridge Street, 41 and 43-45 Mary Parade, occupied

cottages, that a schedule by metes and bounds and estimates

of income and expenditure be prepared and it be noted it is

foreshadowed that a similar rate is intended to be made in

1970, after which a local rate will not be considered necessary

and then discontinued.'

The reference to 41 Mary Parade in this recommendation

is to the plaintiff's land. Presumably the other three parcels

of land had also been the subject of some protest to the

Council.

The Ward Committee's recommendation was received and

adopted at the council meeting of 8th April 1969. The matter

was apparently recommitted for further consideration, and

in its report of 26th May 1969, the Ward Committee restated

its recommendation of 31st March 1969. This recommendation

came again to the Council on 2nd June 1969. The Council,

after considering the matter in committee resolved that a

local rate of one cent in the dollar be made, as in 1968. The

omission of the plaintiff's land and the other three parcels of

land was not included within the Council's resolution.

Thereafter the formal steps necessary to make and levy the

rates were carried out by the Council. The plaintiff has not

paid the local rate for 1969.

In due course the plaintiff commenced the present suit, in

which he challenges the validity of the imposition of this

local rate during the years 1968 and 1969."

2. The fate of the appeal depends upon the construction to be given to s. 121 of the Local Government Act (N.S.W.) which authorizes the imposition of local rates. It is as follows:

"121. (1) For or towards defraying the expenses of

executing any work or service or for or towards repaying with

interest any advance made by the Minister or debt incurred

or loan raised in connection with the execution of any work or

service where, in either case, such work or service in the opinion

of the Council would be of special benefit to a portion of its

area to be defined as prescribed, the Council of a municipality

or shire may make and levy a local rate on the unimproved

capital value or on the improved capital value of rateable

land within such portion." (at p322)

3. The basic principle behind this provision is, without doubt, that owners of rateable land within the defined portion of the municipal area, which would be specially benefited by the execution by a council of proposed works or services, can be called upon to make a special contribution towards the expenses of their execution by means of the imposition of a local rate. The section, however, leaves it to council to form a binding opinion that what is to be done "would be of special benefit to a portion of its area to be defined as prescribed". It is ratable land within such portion that may be rated. A council must therefore form an opinion whether any and what portion of its area would be specially benefited by the execution of what is proposed. This opinion determines the land that may be rated. There is thus a correspondence, dependent upon the opinion of the council, between (1) the land to which the execution of the work will be of special benefit and (2) the land to be rated. If it could be shown that the portion defined included land about which the Council concerned could not in reason hold the opinion that it would be specially benefited by the execution of the works, the section would not authorize the making and levying of a local rate. Thus, for instance, if the works to be executed were the drainage of low-lying land, a council could not, in reason, be of the opinion that high land from which water flowed freely down to low-lying land would be specially benefited by the execution of the works. (at p322)

4. Less obviously perhaps, if the portion defined did not include land which any reasonable man, who considered the matter, must be of the opinion would be specially benefited by the execution of the works equally with the land within the portion defined, the section would not authorize the making and levying of a local rate within the portion defined. Thus, to take the same instance, if, part of the low-lying land to be drained, were to be omitted from the defined portion, that portion would not be defined as required by the section. The section does not authorize a council to pick and choose among lands that would be specially benefited. (at p323)

5. Limitations of the sort just referred to are implicit in the section. The definition of the land that may be subjected to a local rate is determined by the council's justifiable opinion of special benefit so that, if the so-called opinion could not be justified on any reasonable ground, then, the requisite opinion is lacking. There is, however, a world of difference between justifiable opinion and sound opinion. The former is one open to a reasonable man; the latter is one that is not merely defensible - it is right. The validity of a local rule does not depend upon the soundness of a council's opinion; it is sufficient if the opinion expressed is one reasonably open to a council. Whether it is sound or not is not a question for decision by a court. (at p323)

6. A court may interfere only when it appears that the portion defined is so obviously not the land which the execution of the works benefits specially that the court can say that the council's professed opinion that it is, is one that is not in keeping with the section so that the making and levying of a rate on the basis of that opinion is outside its power: Bankstown Municipal Council v. Fripp [1919] HCA 41; (1919) 26 CLR 385 ; Coal Miners' Industrial Union of Workers of Western Australia v. Amalgamated Collieries of Western Australia Ltd. [1960] HCA 68; (1960) 104 CLR 437 . (at p323)

7. There is, however, another way of impugning the basic opinion of a council. The opinion of a council cannot in law be formed by reference to considerations foreign to the purposes of the section. The section indicates broadly that the council is to be concerned with special benefit to lands within the municipal area. The portion that will be benefited is to be defined as prescribed by metes and bounds. It is, therefore, at the land that the council must look, not to the circumstances of owners or occupiers of the land who will be liable to pay the rate which should be imposed. Thus, for instance, to omit from a portion all lands owned by companies and to include therein only lands owned by individuals would be to have formed an opinion of the portion to be specially benefited by reference to an irrelevant circumstance and the council's opinion would be vitiated. The principle is straightforward and well established. It has been applied in circumstances like those now under consideration in Alan E. Tucker Pty. Ltd. v. Orange City Council (1969) 90 WN (NSW) 477 . (at p324)

8. The application of the principle in a particular case, however, is often difficult. The statement of facts already made indicates that it becomes a matter of critical importance to decide whether the particular use to which land is being put at the relevant time may be adopted by a council as decisive in the formation of an opinion whether it will or will not be specially benefited by the execution of the works proposed. I say "decisive" because on the facts, it is obvious that the only difference between adjoining blocks of land - one within and one outside the defined portion - is that one was being used exclusively for residential occupation whereas the other was not. It was that circumstance only that put it outside the defined portion. As to this, Street J. said (1971) 23 LGRA, at p 84 :

"It is clear enough in this case how the Council came to

describe the portion of the area to be subjected to the local

rate. It was the Council's avowed intention to exclude from

the portion of the area 'as many occupied cottages as

practicable."

"... The important fact is that the Council selected ninety

parcels of land believed to fall within the description of

'occupied cottages' and conferred upon those parcels of land

immunity from the local rate by defining the area in terms

which specifically excluded them from it." (at p324)

9. In reaching the conclusion, Street J. examined - as an instance of what underlay the Council's resolution - the position created in Mary Parade. He said (1971) 23 LGRA, at pp 84-85 :

"For example, in Mary Parade, the centre of the three north-south

roads, one sees that out of forty-nine suburban allotments

fronting on to Mary Parade some were specifically excluded

from the land to be rated, and others were left in. Running

down the eastern side (odd numbers) of Mary Parade, Nos. 1 and

3 were in the rated land, 5 to 15 were excluded, 17 was in, 19

was out, 21 was in, 23 to 27 were out, 29 was in, 31 and 33

were out, 35 to 41 were in, 43 was out and 45 to 49 were in.

On the other side of the road (even numbers) Nos. 2 to 4 were

out, 6 to 12 were in, 14 to 26 were out, 28 was in, 30 to 36

were out and 38 to 48 were in.

'I have admittedly selected the most striking example of

what I describe as the random nature and effect of the inclusions

and exclusions. There is nothing in the topography of the

land or the nature of the special works to be carried out which

would justify these exclusions in point of the likelihood of the

included parcels receiving more value or special benefit from

the proposed work as against the excluded portions. The

benefit to the parcels of land upon which are erected occupied

cottages from the footpaths, kerbing and guttering and from

roadworks and drainage works is indistinguishable from the

benefit to nearby or immediately adjoining land not similarly

used." (at p325)

10. In this Court, it was suggested by counsel for the appellant that the learned judge was under a misapprehension in proceeding on the footing that works were to be done in Mary Parade. As to that all that needs to be said is that if it be that no works were to be done in Mary Parade, there could have been no basis other than current user upon which one block in Mary Parade was included within the portion defined and the adjoining block left out. The appellant does not improve its position by its attempt to show that no works were to be done in Mary Parade. (at p325)

11. I accept entirely the statement of Street J. which I have already quoted. Accepting that statement, I also accept the conclusion that the Council's so-called opinion was one which could not reasonably have been formed and that, even if there were a definition of the portion by way of metes and bounds - a point to which I will return, there was not a portion of the municipal area defined in accordance with the provisions of the section as a whole. (at p325)

12. His Honour, however, went further and decided that the particular exclusions from the portion were made by reference to an irrelevant consideration. He said (1971) 23 LGRA, at p 85 :

"The clear finding to be made on the evidence is that the

exclusion of the occupied cottages was intended to give effect

to an extraneous consideration. No matter how worthy from

a community point of view, it was not open to the council to

decide to exempt the owners of occupied cottages from sharing

in liability to pay this local rate for no other reason than that

because of the personal situations implicit in their use of their

land it was felt that they were deserving of this special

immunity." (at p325)

13. Later his Honour said (1971) 23 LGRA, at p 86 :

"The Council here has sought to alleviate the financial

burdens of the cottage owners. That is a criterion of

discrimination that cannot reasonably be regarded as having

any legitimate relevance to the opinion which the council is

required to form under s. 121. The Council has been guided

by this irrelevant and inadmissible consideration." (at p325)

14. It is not necessary, I think, to go as far as his Honour did in the second passage which I have just quoted. It may not be plain just why the Council decided to exclude the specified blocks, but it is certain that what is common to all the blocks excluded is that they were land currently used for residential purposes and for some reason or another, this was regarded as decisive that the land itself would not be specially benefited by the execution of the works. This, I consider, was demonstrably wrong and vitiated the Council's opinion. The use to which land is being put may, of course, be taken into account in determining whether the execution of particular works would be of special benefit to it. The current use of the land could not, however, be decisive that the works are, or are not, of special benefit to the land. More must be looked at than current use. Thus, land on which there is an occupied dwelling house would, without question, be specially benefited by the construction of a heavy duty road along its frontage, if that land were within an area set aside for industry and were for sale for industrial purposes. It would be benefited in just the same way as lands already in use for industrial purposes. (at p326)

15. Accordingly, I agree with the judgment appealed against that the Council did not have the opinion which s. 121 requires as the condition of the imposition of the local rate both because (1) the portion defined could not, in law, be regarded as a portion which would receive special benefit from the work to be carried out and (2) in reaching its opinion, the Council took into account as decisive a consideration which could not in law be decisive. (at p326)

16. Having granted special leave to consider the important questions of law upon which his Honour's decision depended, I have thought it proper to deal with them. However, in this Court a further question arose, i.e. whether the portion of the area within which the local rate was to be imposed was "defined as prescribed" as required by s. 121. The description in the circumstances had to be by "metes and bounds", Local Government Ordinance, O. 5 r. 28 1/2 (b). It is apparent that the definition here was not "by metes and bounds" for the simple reason that, from an area so described, there were excluded a number of island blocks of land described not "by metes and bounds" but simply by street numbers, in order to constitute the portion. Such portion was not therefore described by metes and bounds. The portion was described partly by metes and bounds and partly by street numbers. To comply with the Ordinance any reduction of an area described by metes and bounds must itself be described by metes and bounds. On this further ground, the plaintiff was entitled to succeed and can rely upon it to resist the appeal. (at p326)

17. In my opinion the appeal should be dismissed. (at p326)

GIBBS J. A council may make and levy a local rate under s. 121 (1) of the Local Government Act, 1919 (as amended) (N.S.W.) ("the Act") on the unimproved capital value or on the improved capital value of ratable land within a portion of its area, for the purpose of defraying in whole or in part the expenses of executing any work or service, if two conditions are satisfied. The first condition is one of substance, namely, that the work or service in the opinion of the council would be of special benefit to that portion of the area within which is the land on whose value the rate is to be levied. The second condition is one of form - the portion of the area within which the rate is to be levied must be defined as prescribed. An ordinance made under the Act (Ordinance 5, cl. 28 1/2 (b)) prescribes, so far as is relevant to this case, that the portion shall be "defined by metes and bounds". (at p327)

2. Work done in a local authority area may be of benefit only to portion of the area or it may benefit the whole area; in the latter case, all the lands in the area will not necessarily benefit in equal measure. A work is of special benefit to a portion of a local authority area if the lands comprising that portion derive from the work a benefit which is not shared by other lands or a benefit which is additional to, or greater than, that which is derived by other lands (cf. Bankstown Municipal Council v. Fripp [1919] HCA 41; (1919) 26 CLR 385, at p 401 ). It may of course prove disputable whether a work benefits a particular parcel of land and, if so, whether it benefits that parcel more than another. For obvious reasons therefore, the legislature has left it to the council to form its opinion as to whether a particular work is of special benefit to a portion of the area. A court has no power to override the council's opinion on such a matter simply because it considers it to be wrong. However, a court may interfere to ensure that the council acts within the powers confided to it by law. If, in purporting to form its opinion, a council has taken into account matters which the Act, upon its proper construction, indicates are irrelevant to its consideration, or has failed to take into account matters which it ought to have considered, the opinion will not be regarded as validly formed. Even if the council has not erred in this way an opinion will nevertheless not be valid if it is so unreasonable that no reasonable council could have formed it (see Associated Provincial Picture Houses Ltd. v. Wednesbury Corporation [1947] EWCA Civ 1; (1948) 1 KB 223, at pp 228-229 and 233-234 , and see also Bankstown Municipal Council v. Fripp (1919) 26 CLR, at p 403 ). (at p327)

3. It appears from what I have already said that a council might reasonably form the opinion that one locality derives special benefit from a work, notwithstanding that another locality derives some lesser benefit from the work. However, if in the opinion of the council two parcels of land would benefit equally from a work, the council could not define a portion under s. 121 (1) so as to include one parcel and exclude the other. It could not say that, although block A and block B would equally share the benefit, only block A should bear the rate. The portion to be defined is that to which the work will in the opinion of the council be of special benefit. Such portion will not be defined if the definition excludes land which the council in fact considers, or which no reasonable council could fail to consider, would derive from the work a benefit equal to that derived by the lands within the portion. (at p328)

4. A ratepayer who asserts that the opinion which a council has purported to form for the purposes of s. 121 (1) is one not reasonably capable of being held has a heavy burden, since due weight must be given to the fact that the council is a responsible elected body with a particular knowledge of local conditions. In the present case, however, the burden has been discharged. For reasons given in the judgments of other members of the Court, which I need not repeat, I regard it as impossible that in the circumstances of this case a council could reasonably have considered both that the land included in the defined portion derived a special benefit and that the blocks excluded from the defined portion did not derive the same benefit. (at p328)

5. The action taken by the Council was understandable enough. Owners of land in a developing area often suffer by being compelled to pay rates which may be appropriate to the potential use of the land but are heavily burdensome when regard is had to its actual use. It was not unnatural that the Council should have wished to make the rate fall on persons who were using the land for industrial purposes and not on those using it for residential purposes, since the work whose expense was to be defrayed by the rate was for the development of an industrial area. However, s. 121 (1) does not permit this course. The section is concerned with the question whether a portion of the area will receive a special benefit from the work, and not with the question whether the owners of some lands in that portion will, having regard to their personal circumstances, in fact be able immediately to avail themselves of that benefit. Although an individual landowner may personally derive no present benefit from the work, his land does benefit when its value is increased by the additional amenity (cf. Bankstown Municipal Council v. Fripp (1919) 26 CLR, at p 395 ). (at p329)

6. Since the first condition of the power to make the rate was not satisfied, the rate was not validly made. Moreover, in my opinion the portion was not defined as prescribed, that is, "by metes and bounds". This expression simply requires that the boundaries of the portion should be delineated in one way or another in the council's resolution. The schedule to the Council's resolution in the present case commenced by defining a portion by metes and bounds, but then excluded many blocks which were referred to only by lot numbers on a plan and whose boundaries were not given. Some of the blocks formed islands within the area originally defined. In these circumstances the Council has not defined the portion by setting out its boundaries. This failure to comply with the requirements of the section, although not raised in the Court below, provides an additional reason for holding the rate to be invalid. It is unnecessary to consider whether, if a different manner of definition had been prescribed, it would be possible to say that a portion from which numerous island blocks had been excized remained a portion within s. 121. (at p329)

STEPHEN J. Within the municipality of Parramatta is an area styled the Rydalmere Industrial Area. While largely devoted to industrial purposes, it also contains a considerable number of quite modest homes, which in these proceedings have been described as cottages. The plaintiff is the owner and occupier of one such cottage. In 1968, he found that his property was to be made subject to a local rate, the proceeds of which were to be used for street construction, drainage and general embellishment within the area. (at p329)

2. A local rate is one which a council may make, pursuant to s. 121 (1) of the Local Government Act, 1919-1970 (N.S.W.), to meet the cost of works or services which:

"... in the opinion of the Council would be of special benefit

to a portion of its area to be defined as prescribed ..."

and is to be made and levied on the value of ratable land "within such portion". (at p329)

3. The local rate for 1968 was made following a recommendation by the committee of aldermen of the local ward in which the Rydalmere Industrial Area lies:

"That in an endeavour to raise $160,000 over three years,

for urgent works in this area a local rate of one cent in the

dollar be made and the Town Clerk prepare a Schedule by

metes and bounds to exclude as many occupied cottages as

practicable." (at p330)

4. It was following upon this recommendation that the Council resolved, on 22nd July 1968, to make and levy a local rate the proceeds of which were to be used for the purposes already mentioned, the rate to be on all rateable land described in an annexed schedule, which included the plaintiff's land. (at p330)

5. In the year 1969, the local ward committee again recommended the imposition of a local rate upon the same area as in the preceding year save that three occupied cottages included in the previous year's area were to be excluded. One of these cottages was the plaintiff's. However, when the Council came to make the local rate for the year 1969 it did not exclude any of the three properties referred to in the ward committee's recommendation so that the area to which the rate applied remained the same as in 1968. (at p330)

6. The plaintiff paid the local rate assessed in respect of his land for the year 1968, doing so under protest, but failed to pay the amount levied in 1969 and instead sued for a declaration that the resolutions of the Council making the rates, and the rate notices served on him, were ultra vires; he also sought an injunction restraining the enforcement against him of the 1969 rate and an order for repayment by the Council of the amount paid by him in 1968. Whether the plaintiff is to succeed or not does not, of course, depend upon any suggested unfairness to him which may be involved in his premises, unlike other occupied cottages within the rated area, not being excluded from the incidence of the rate but rather upon whether the rates were lawfully made by the council. (at p330)

7. The making of these two rates was successfully attacked before Street J. in the Equity Court upon grounds concerned with the nature of the Council's determination of the area to be subjected to the rate. His Honour held that the area to be benefited must be co-extensive with the area to be rated, it being for the council to form its own opinion as to the extent of the area specially benefited and, having done so, to then impose the rate upon all rateable property within the precise area, no more and no less. He then upheld the plaintiff's submissions that, "as a matter of sheer geographical objectivity", the Council could not have regarded the area it had rated as the area specially benefited and also that its decision as to that area was vitiated by the pursuit of an inadmissible purpose, the alleviation of the financial burdens of cottage owners. It is from this decision and the consequent orders made that this appeal is brought. (at p330)

8. To appreciate the basis of the plaintiff's attack upon these rates it is necessary to describe the way in which the Council defined the area to be rated. In each case the relevant resolution described the area by reference to a schedule which delineated a large area of land by metes and bounds and which then concluded with a paragraph excluding from that area some ninety individual parcels of land lying within it which were, in the main, identified by street numbers and were interspersed throughout much of the total area. The evidence established that the basis of exclusion of these parcels was that, unlike the rest of the area, they were considered to be the sites of occupied cottages. Effect was, it seems, thus sought to be given to the ward committee's recommendation that "as many occupied cottages as practicable" be excluded from the area to be rated. (at p331)

9. Many of the excluded parcels, being individual subdivisional lots, adjoined included lots on one or both sides and Street J. found as a fact that the existence of occupied cottages on the excluded lots was the only ground for distinguishing between them and other parcels which were included in the rated area. There was no ground, his Honour found, upon which excluded parcels could be distinguished from included parcels so far as their common participation in special benefit from the proposed works was concerned. (at p331)

10. This finding is amply supported by the evidence and is sufficient to invalidate the making of these rates as ultra vires the council. (at p331)

11. Section 121 (1) is not a sub-section conferring upon councils any broad discretionary powers; it does no more than leave to a council two questions of fact for it to determine by the formation of its own opinion, the main fact being whether or not specified works or services are such as "would be of special benefit to a portion of its area". Inherently involved in answering this main question is the need for an answer to the subsidiary question "What portion?" The legislation leaves it to councils to form their own opinions on these questions and those opinions will be conclusive; but there are well defined limits to such conclusiveness, it is not absolute. Thus, in Bankstown Municipal Council v. Fripp [1919] HCA 41; (1919) 26 CLR 385, at p 403 Isaacs and Rich JJ. said that a council's opinion on the main question, which was there in issue, was conclusive so long as the work or service "is reasonably capable of being so considered", that is to say, of being considered as of special benefit to a portion of the council area. In K.C.R. Pty. Ltd. v. Orange City Council (1968) 16 LGRA 153, at p 157 , Else-Mitchell J. expressed the test negatively in denying conclusiveness where the work or service "cannot be said to be reasonably capable of being regarded by the council as of special benefit to the particular area defined." (at p332)

12. Likewise, the council's answer to the subsidiary question will not be conclusive if the portion defined by the council cannot be said to be reasonably capable, in the view of the court, of being regarded as that portion receiving special benefit from the works or services proposed. Conclusiveness will also not attach to a council's opinion if it be shown to have been formed having regard to extraneous or irrelevant matters - Baldwin v. Orange City Council (1964) 82 WN (Pt 1) (NSW) 45, at p 48 and Alan E. Tucker Pty. Ltd. v. Orange City Council (1969) 18 LGRA 314 . The reason why the courts will in such cases disturb the otherwise conclusive opinion of the council is because it will then be apparent that the council has not in fact performed the only task permitted of it and upon which alone the legislation confers conclusiveness but has embarked upon some other course unauthorised by the sub-section. (at p332)

13. This is just such a case; the facts make it clear that that portion of the council area left after excizing the ninety-odd lots is not such a portion as is reasonably capable of being considered as the portion specially benefited by the works here proposed. It is, instead, such a portion less those lots believed by the Council to be the sites of occupied cottages. If it were possible in some way to relate the incidence of special benefit to the non-existence of occupied cottages on particular lots, the consequence would be otherwise but where this is not possible the only conclusion must be that the criterion for inclusion within the rated area has been other than the only one permitted by the sub-section, namely special benefit. (at p332)

14. There is, therefore, shown to be lacking the necessary correlation between special benefit and the area to be rated, and the Council's actions in making the local rates have not in fact been in exercise of its powers under s. 121 (1). (at p332)

15. It may be that the Council, in considering the area of special benefit, had regard to the current use to which properties were being put and concluded that, because the owners or occupiers of occupied cottages might not be able to take advantage of the proposed works in the same way as would the owners of occupiers of industrial property in the area, it was proper to exclude the ninety-odd lots from the rated area. If so, this involves a misunderstanding of the meaning of "special benefit", which is not concerned with advantages in fact conferred upon individuals but with benefits conferred upon land. (at p333)

16. This distinction is important and the history of the legislation, the judgments of this and other courts, and the words of the section itself all point, in my view, to the conclusion that "special benefit" refers exclusively to benefits conferred upon land, which will be reflected in the value of that land, and is unrelated to what may be the quite different question whether or not the owner or occupier of a property choses to, or is in a position to, avail himself of the benefit conferred. (at p333)

17. The history of the legislation is discussed at length in Bankstown Municipal Council v. Fripp (1919) 26 CLR, at pp 398-400 . The Municipalities Act of 1867 (N.S.W.) provided for the striking of "special rates", as distinct from ordinary rates, to be levied on "the owners or occupiers of any property within the municipality deriving any benefit or advantage" from works to be constructed and which were to be paid for by those rates. This situation persisted under the Municipalities Act of 1897 but by the Local Government Act of 1906 (N.S.W.) rates other than ordinary rates were divided into "local rates" and "special rates", only the former being limited to particular localities; s. 154 (1) of that Act employed the same relevant wording as is now to be found in s. 121 (1) of the current Act. Thus, the origin of the present section lies in the old "special rate" which was to be borne by those whose properties derived a benefit or advantage from works financed by the rates, whether or not the owners or occupiers of those properties in fact did, or could, avail themselves of such benefit or advantage. (at p333)

18. In the Bankstown Case, it had been held by Sly J., in the New South Wales Full Court (1919) 19 SR (NSW) 17 , that the equivalent of s. 121 (1) was inapplicable to the service of night-soil removal, in part because it would result in unoccupied land alike with occupied land having to bear the rate. On appeal Isaacs and Rich JJ., in their joint judgment, said of this contention, which in effect expresses the view that it is benefit to the owner or occupier, rather than to the land, which is the concern of this section, (1919) 26 CLR, at p 395

"...on principle, if a special benefit is in fact conferred on

any particular portion of an area by a specially frequent

sanitary removal - as in a comparatively thickly populated

portion of the municipality - that fact sends up the value of

all the land in the locality, and so benefits even land for the

moment unoccupied. The portion of the area becomes a

comparatively more desirable residential locality, and a

possible purchaser or tenant would take it into consideration."

Their Honours thus clearly adopt the view that regard is to be had to the benefit to property, as reflected in land values, and not to whether or not advantage be in fact taken of that benefit by particular occupiers or owners; of course, benefit to property will very often also result in an immediate advantage to the occupier or owner and evidence of such an advantage will demonstrate that there has been a benefit to property; it is only the negative of the proposition which is erroneous. Thus, in Borough of Alexandria v. Cooper (1890) 11 NSWLR 166, at p 169 , Sir George Innes, speaking of the "benefit or advantage" to be derived by a property from proposed works, said:

"It seems to me that it would be an advantage to that

property in two ways. It would increase the selling value,

and it would be an advantage or benefit in the occupation,

use, or enjoyment of the property."

In K.C.R. Pty. Ltd. v. Orange City Council (1968) 16 LGRA 153, at p 158 , Else-Mitchell J. said of s. 121 (1):

"...the Act does not seek to attach benefit to persons and

there is no means under the Act whereby a rate can be attached

to persons except by a charge for admission or for the use of

facilities. What s. 121 (1) does is to authorize a council to

attach a rate to land in an area which in its opinion will derive

special benefit from the work or service provided; the special

nature of the benefit to the land is not one to be measured

against the benefit to persons as such or to persons other than

the owners or occupiers of the land to be rated but against the

benefit to other land in the council's area..."

The words of the sub-section are themselves specific in this regard; they speak of special benefit to a portion of the council area and not of special benefit to any group of ratepayers. (at p334)

19. It follows that the particular current use to which any land is put should not of itself be regarded as depriving that land of the character of land specially benefited if in fact the proposed works so enhance its value that, in the council's opinion, it would otherwise qualify as land of that character. Enhancement in value without advantage in current user is no more than an indication that the land is not being put to its highest economic use; a special benefit is not to be disregarded simply because some lower economic use to which, for the time being, the land is being put precludes advantage being taken of that special benefit. (at p335)

20. I would dismiss this appeal and uphold the decision of the learned primary judge upon the first ground upon which his decision was based. I have had the advantage of reading the reasons for judgment of my brother Menzies in the course of which he deals with a further question which arose for the first time in the argument in this Court, relating to the need for definition by metes and bounds of the area to be rated, and I concur in all that is there said on that subject. (at p335)