Perry Properties Pty Limited v Georges River Council [2023] NSWLEC 51 | Case summary

Land and Environment Court (NSW)|2023-03-24|Before: Pritchard J

s) R Lancaster SC and J McKelvey (First Respondent) Submitting appearance (Second Respondent) Submitting appearance (Third Respondent) Submitting appearance (Fourth Respondent) Solicitors: Weinberger Lawyers (First, Second, Third, Fourth, Fifth and Sixth Applicants) HWL Ebsworth Lawyers (First Respondent) Crown Solicitor's Office (Second Respondent) Dentons (Third Respondent) Marsdens Law Group (Fourth Respondent) File Number(s): 2022/289534 Publication restriction: Nil

Introduction

In these Class 4 enforcement proceedings, by way of further amended summons which the Court granted leave to be filed on 8 May 2023, the applicants seek: 1. a declaration that the proposed acquisition notices dated 29 June 2022 in relation to the land known as 247 Princes Highway, Carlton, being the whole of Lot 1 in Deposited Plan 301901, Parish of St George, County of Cumberland (the property), issued by the first respondent, Georges River Council (Council) to each of Perry Properties Pty Limited (Perry Properties), National Australia Bank Limited, International Buddhist Association of Australia Co-operative Limited (International Buddhist Association), Vince Perry, Maria Perry, Anthony Perry, Rosina Perry, and Joanna Perry (the PANs) are unlawful; and 2. an order restraining Council, by itself, its servants, agents or solicitors, from publishing the PANs in the Government Gazette and from taking any further steps to compulsorily acquire the property pursuant to the notices.
The first applicant, Perry Properties, is the owner of the property, having become registered proprietor on 13 July 1988. The second to sixth applicants are option grantees (the option grantees) with an interest in the property recorded on title via caveat AS201292 dated 9 June 2022 (the caveat).
The property is currently leased to the fourth respondent, the International Buddhist Association, and is known as "Nan Tien Buddhist Temple Kogarah".
The property is located within the Jubilee Oval Precinct (also known as Jubilee Stadium Precinct), and is the only privately owned parcel of land within a block bounded by Jubilee Avenue, Park Street, English Street and the Princes Highway, on which is situated the Jubilee Oval Stadium and Kogarah Park, all within the local government area of what is now known as Georges River Council (the Jubilee Stadium Precinct).
The property is also known as the former Kogarah Hotel. The former Kogarah Hotel is listed as a heritage item in Part 1 of Schedule 5 to the Georges River Local Environmental Plan 2021 (GRLEP).
On 28 February 2022, Council resolved to acquire the property. The terms of Council's resolution were as follows: CLOSED CONFIDENTIAL SESSION CONSIDERATION OF CONFIDENTIAL RECOMMENDATIONS BCCL005A-22 Property Matter - 247 Princes Highway, Carlton - Acquisition (Report by Strategic Property Specialist) RESOLVED: Councillor Elmir and Councillor Greene (a) That Council proceed with the compulsory acquisition of the land described as Lot 1 in deposited Plan 301901 at 247 Princes Highway, Carlton for the purpose of providing public recreation space in accordance with the requirements of the Land Acquisition (Just Terms Compensation) Act, 1991. (b) That Council make an application to the Minister and the Governor for approval to acquire Lot 1 in Deposited Plan 301901 at 247 Princes Highway, Carlton by compulsory process under section 186(2)(a) of the Local Government Act 1993. (c) That the land be classified as community land pursuant to Section 31 of the Local Government Act, 1993. Record of Voting For the Motion: Unanimous
On 29 April 2022, the Minister for Local Government (the Minister) approved Council giving PANs in order to commence pre-acquisition procedures in relation to the interests of the registered landowner, the registered lessee and the registered mortgagee.
Under cover of letters dated 17 June 2022 and 24 June 2022, Council gave PANs post-dated 29 June 2022 to the first applicant, Perry Properties, as registered proprietor of the property, to the second to sixth applicants, Vince Perry, Maria Perry, Anthony Perry, Rosina Perry and Joanna Perry, as caveators, to the third respondent, National Australia Bank, as mortgagee, and to the fourth respondent, the International Buddhist Association, as lessee.
Council is the first respondent. The second respondent is the Minister for Local Government. Each of the second, third and fourth respondents has filed a submitting appearance.
On 28 September 2022, the applicants commenced these proceedings. On 25 October 2022, Council provided an undertaking to the Court not to take any further steps to compulsorily acquire the property pending determination of these proceedings.
On 23 March 2023, I granted the applicants leave in Court to rely on an amended summons in answer to the first respondent's draft amended response to summons which raised a jurisdictional issue in relation to Ground 3, and amended the description of the parties. On 8 May 2023, in chambers, I granted the applicants leave to rely on a further amended summons correcting the number of the Deposited Plan in respect of which relief was sought in the earlier summonses.

Grounds

In summary, the applicants allege that Council's purpose in acquiring the property was not for an authorised purpose, but to acquire the property as part of a larger redevelopment which involves a commercial purpose and/or a potential re-sale. The applicants also allege that Council misled the Minister in its application to the Minister for approval of the acquisition.
The decisions sought to be reviewed are the decision of Council on 28 February 2022 to issue the PANs, and the decision of the Minister on 29 April 2022 to approve the PANs (the decisions).
The further amended summons raises three grounds of challenge to the decisions: 1. Firstly, that there has been a breach of ss 186 and/or 188 of the Local Government Act 1993 (NSW) (LGA) on the basis that the Council is not acquiring the land for an authorised purpose and/or is acquiring for re-sale. 2. Secondly, that there has been a breach of s 187 of the LGA on the basis that Council has not obtained the valid approval of the Minister because the Minister has been misled as to the purpose of the acquisition, namely that Council was not acquiring the land for its stated purpose of providing "public recreation space". In addition, Council's resolution resolving the proposed acquisition was held in closed session, ignoring the objection of the applicants, and the objection of the applicants was not disclosed to the Minister. 3. Thirdly, that there has been a breach of s 187 of the LGA insofar as the acquisition was not in accordance with s 10A of the Land Acquisition (Just Terms Compensation) Act 1991 (NSW) (Just Terms Act) in that the interest holders Vince Perry, Maria Perry, Anthony Perry, Rosina Perry and Joanna Perry were not afforded the required six-month negotiation period (prior to the issue of the PANs).

Outcome

I have determined that the further amended summons be dismissed. I will make a direction that the parties file written submissions, no longer than five pages in length, by Wednesday, 17 May 2023 in relation to the question of costs.

Relevant statutory provisions

Chapter 7 of the LGA is headed "What are the regulatory functions of councils?". In Part 1 "Approvals", in Division 1 "What activities require approval", s 186 provides as follows: 186 For what purposes may a council acquire land? (1) A council may acquire land (including an interest in land) for the purpose of exercising any of its functions. (2) Without limiting subsection (1), a council may acquire - (a) land that is to be made available for any public purpose for which it is reserved or zoned under an environmental planning instrument, or (b) land which forms part of, or adjoins or lies in the vicinity of, other land proposed to be acquired under this Part. (3) However, if the land acquired is, before its acquisition, community land vested in a council, the acquisition does not discharge the land from any trusts, estates, interests, dedications, conditions, restrictions or covenants that affected the land or any part of the land immediately before that acquisition.
Also in Division 1 of Part 1 in Chapter 7, s 187 provides: 187 How does a council acquire land? (1) Land that a council is authorised to acquire under this Part may be acquired by agreement or by compulsory process in accordance with the Land Acquisition (Just Terms Compensation) Act 1991. (2) A council may not give a proposed acquisition notice under the Land Acquisition (Just Terms Compensation) Act 1991 without the approval of the Minister.
Further, s 188 provides: 188 Restriction on compulsory acquisition of land for re-sale (1) A council may not acquire land under this Part by compulsory process without the approval of the owner of the land if it is being acquired for the purpose of re-sale. (2) However, the owner's approval is not required if - (a) the land forms part of, or adjoins or lies in the vicinity of, other land acquired at the same time under this Part for a purpose other than the purpose of re-sale, or (b) the owner of the land cannot be identified after diligent inquiry has been made and at least 6 months has elapsed since that inquiry was made. (3) For the purposes of subsection (2)(b), diligent inquiry has the meaning given by the regulations, and includes the giving of notice of the proposed acquisition to the New South Wales Aboriginal Land Council and to the relevant Local Aboriginal Land Council.
Section 10A of the Just Terms Act provides: 10A Minimum period of negotiation for acquisition by agreement before initiation of compulsory acquisition process (1) This section applies to land that is affected by a proposal for acquisition by an authority of the State, other than a proposal to acquire - (a) Crown land, or (b) an easement, or right to use land, under the surface for the construction or maintenance of works, or (c) a stratum under the surface for the construction of a tunnel. (2) The authority of the State is to make a genuine attempt to acquire the land by agreement for at least 6 months before giving a proposed acquisition notice. (3) The owner of the land and the authority of the State may agree to a shorter or longer period of negotiation for the acquisition of the land by agreement. (4) The Minister responsible for the authority of the State may approve a shorter period of negotiation, but only if the Minister is satisfied that the urgency of the matter or other circumstances of the case make it impracticable to have any longer period of negotiation. Any such approval requires the concurrence of the Minister administering this Act (being concurrence given for the particular approval or given generally for an approval of that kind). (5) This section does not prevent a continuation of negotiation after the giving of a proposed acquisition notice. (6) The authority of the State is not required to comply with this section if - (a) the owner of the land notifies the authority that the owner is not prepared to negotiate with the authority for the acquisition of the land by agreement, or (b) the owner of the land cannot be located after the making of reasonable inquiries. (7) Nothing in this section gives rise to, or can be taken into account in, any civil cause of action.
Section 12 of the Just Terms Act provides: 12 Owners to be given notice (1) A proposed acquisition notice need only be given to all the owners of the land who - (a) have a registered interest in the land, or (b) are in lawful occupation of the land, or (c) have, to the actual knowledge of the authority of the State, an interest in the land. (2) If the proposed acquisition notice relates only to a particular interest in land, the notice need only be given to all such owners of that interest. (3) If the proposed acquisition notice relates to an interest which does not exist (such as a proposed easement), the notice need only be given to all the owners of the land who - (a) have a registered interest in the land (other than a mortgage interest), or (b) are in lawful occupation of the land. (4) If the proposed acquisition notice relates to land under the Real Property Act 1900, the authority of the State must give a copy of the notice to any person who has lodged a caveat which is recorded in respect of the land in the Register kept under that Act. (5) If the proposed acquisition notice relates to land that is the subject of a registered native title claim under the Commonwealth Native Title Act, the authority of the State must give a copy of the notice to the registered native title claimant under that Act.

Factual background

In addition to the matters briefly set out in [2]-[11] above, the relevant factual background is as follows. On 26 April 2016, the former Kogarah City Council resolved: a) That subject to the consent of the Minister for Local Government, the property No. 247 Princes Highway, Kogarah, be acquired by way of compulsory acquisition. b) That a further report be submitted to Council following receipt of the valuation referred to in paragraph 8 of the report.
The minutes of the 26 April 2016 meeting record that Council had previously resolved to acquire the property at a meeting on 11 October 2010, but later rescinded that resolution at a meeting on 27 February 2012. The minutes of the 26 April 2016 meeting also record that the development consent for the use of the premises as a restaurant would lapse in March 2017, and that in April 2011 Council refused a development application to continue the use of the premises as a restaurant beyond its lapsing.
In October 2017, Council issued a Request for Quotation for "Consultancy Services - Master Plan for Jubilee Oval Precinct" (RFQ), with a closing date of 20 November 2017. The applicants referred to the RFQ as one of the "critical documents".
In relation to the text under the heading "Precinct", the applicants emphasised the following items: 1. Land ownership consolidation including compulsory acquisition that may also include DA consents (refer to Appendix 2 - Cadastral Map) … 10. Explore accommodation on the site such as serviced apartments or accommodation hotel.
Under the heading "Project Purpose", the RFQ stated: With the return of the venue to Council management, Georges River Council now plans to explore strategies to maximise the use of the venue and the utilisation of the land in the precinct of Jubilee Oval. In order to deliver this outcome, Council requires the selected consultant to provide a Masterplan that includes opportunities to: maximise revenues from the built forms and adding capital value to the precinct; consider environmental sustainability; establish a precinct that is a recognised hub for sport and recreation and associated endeavours and activities. The master plan must obviate (sic) community benefit as well as commercial sustainability of the site. Consolidation of the land parcels in the precinct is an additional focus of this project.
The Court was also taken by the applicants to the heading "Staging" in the RFQ, which outlined the stages of development envisaged for the project as follows: Stage 1 0 - 3 years Venue - Western Grandstand and facilities Stage 2 0 - 5 years Parking and leisure precinct infrastructure Stage 3 0 - 7 years Built form - commercial; retail; serviced apartments or hotel
The cadastral map of the Jubilee Oval Precinct at appendix 2 to the RFQ shows the land parcels and zoning as at 23 August 2017. The subject property is in the south-eastern corner, being Lot 1 in DP 301901.
On 23 May 2018, Council held two stakeholder workshops with the "successful" consultants in relation to the RFQ, mainly being BVN Architects (BVN). In the morning, there was a workshop in relation to "Hirers/Operators/Users" attended by, amongst others, representatives of BVN, Xmirus, Council, and a number of hirers, operators and users of the Jubilee Oval Precinct.
In the afternoon of 23 May 2018, there was a workshop in relation to "Council Management" attended by, amongst others, representatives of BVN, Urbis, Xmirus and Council.
The minutes of the two workshops on 23 May 2018 record, in relevantly identical terms, that: This informal meeting is an opportunity for BVN to present to the current Operators and Hirers of Jubilee Oval an overview of the brief they received from Georges River Council and participants are encouraged to provide their knowledge, as well as wants, needs and usage of the venue.
The minutes of the two workshops on 23 May 2018 also record, in relevantly identical terms, at the first bullet point under the heading "Precinct": - Land ownership and consolidation (north/eastern corner)
On 24 May 2018, Ms Isabell Beck, senior associate at BVN, sent a follow up email to representatives of consultants BVN, Urbis, Xmirus and Arup with the subject line "Jubilee Oval Masterplan updated & next steps", attaching the presentation from the workshops on 23 May 2018, and summarising the main outcomes of the meetings as follows (emphasis added): Council Management: - Public recreation area to be maintained (lack of open space in GRC) - Kogarah hotel as built form heritage listed and to be maintained - Advised to engage heritage consultant - Underground car parking acceptable (green space above) As a result we would suggest the 5 masterplan strategies to develop further are: Oval: … Stadium: … Precinct (various options which we can feed into the different oval configurations): - Centre of excellence seems to be the preferred new use - Park extend to include Kogarah hotel as free standing pub / café - Park to remain levelled on princes hwy but can step up at the back - Carpark under park -1-2-3 levels? 800 carspots ideal? Access? - Build under berm/ grandstand and open up into park - Use of Kogarah park as warm-up area? - Bridge/ tunnel link to St George Leagues Club?
In June 2018, following the meetings on 23 May 2018, BVN (in conjunction with Xmirus, Arup and Urbis) prepared a document titled "Jubilee Oval Precinct Master Plan Phase 1 Report June 2018" (2018 Master Plan).
On 19 November 2018, Councillors and Council officers attended a "Councillor Briefings and Workshop Session". In evidence was a presentation given at that session in relation to the "Jubilee Stadium Precinct Master Plan". The presentation set out four agreed masterplans to be explored, referred to as "options". Of relevance were: 1. "Option 3 - Rectangular" to maintain the existing western grandstand in the Jubilee Stadium Precinct, modifying the lower tier to suit rectangular field of play, to tighten up northern, eastern and southern edge for a pure rectangular mode, and to construct a new 5000 seat grandstand to the east. 2. "Option 4 - Opportunity" to reflect the same inclusions as Option 3, plus an opportunity for commercial revenue to English Street and along Princes Highway.
On 11 February 2020, Mr Jim Allison, strategic property specialist at Council, sent a letter to Mr Vince Perry (the second applicant) stating that "Council has long had an interest in your property", and that "Council would be prepared to offer compensation in accordance with the Land Acquisition (Just Terms Compensation) Act 1991".
On 17 July 2020, Mr Tim Crawshaw, practice director at BVN, sent an email to Mr Luke Coleman of Council (who the applicants submitted was the "controlling mind" of Council in relation to the Jubilee Stadium Precinct master planning), attaching a document titled "Netstrata Jubilee Stadium Precinct Master Plan Phase 4 Report 2020 Draft Internal Document". On 23 July 2020, Mr Crawshaw circulated an email to his "team" with the subject line "Jubilee Masterplan report phase 4 completion". Mr Crawshaw wrote: "we have provided Luke with the updated report, which he has reviewed and now approved." The updated report was the 2020 Master Plan, which the applicants submitted was also one of the "critical documents".
The 2020 Master Plan focused on Options 3 and 4, identified in the 2018 Master Plan, for the redevelopment of the Jubilee Stadium Precinct. The 2020 Master Plan relevantly provided for: 1. Option 3A, concerning the construction of a 50m swimming pool facility within the Jubilee Stadium Precinct; 2. Option 3B, concerning the construction of three basketball courts within the Jubilee Stadium Precinct; and 3. Option 4, to be considered in addition to the strategies and amenity offered in Option 3, concerning a "commercial opportunity" of a potential "80 room hotel and a residential or serviced apartment complex".
The image below is a "pictorial" in relation to "Option 3A + 4 - Park Level (50m Pool)" depicted in the 2020 Master Plan (the pictorial). The applicants submitted that the subject property (located in the south-east corner of the pictorial) is depicted as a licenced pub or café.
The second image below is a proposal for landscaping of the proposed Jubilee Stadium Precinct for Option 4 in the 2020 Master Plan. The subject property is located in the south-eastern corner of the image, marked as number "15", and identified in the key as "Kogarah Hotel". The image shows the property located on the corner of the Princes Highway and English Street. Adjacent to the Kogarah Hotel along English Street is number "14", identified in the key as "Hotel Terrace and Garden", which the applicants submitted is part of the subject property. On the other side of the property along the Princes Highway is number "17", identified as "Building Development Opportunity", and number "18", identified as "Existing Trees".
The applicants directed the Court to a number of other aspects of the 2020 Master Plan. In particular: 1. In relation to Option 4, the 2020 Master Plan identified "opportunit[ies]" on parcels of land on either side of the property, on both English Street and the Princes Highway, as a hotel and residential/commercial building. 2. Also in relation to Option 4, the 2020 Master Plan referred to "development opportunities (500ms and 700ms) highlighted along Princes Highway [which] will reduce the public open space". 3. In relation to the "Phase 4 Considerations" for Options 3A and 3B, there is a cost estimate schedule referring to item number "18 TBC" with a masterplan strategy: "Saleable development at the south edge along Princes Highway- hotel - resi - retail front". The description of that item is: "Approx…120 hotel rooms…Approx…60 resi. units…retail/services tenancies at ground".
The minutes of Council's meeting dated 22 March 2021 record a Councillor question: "When will this draft master plan be publicly released?" And the officer response: Councillors reviewed the draft Masterplan at a Councillor workshop on 19 November 2018 and agreed to defer further consideration until such time as the Plan of Management could be prepared and sources of funding for the Masterplan could be identified. If the budget bid is approved by Council, it is anticipated that the draft Plan of Management and the accompanying draft Masterplan for the Netstrata Jubilee Stadium Precinct could be prepared for public exhibition in the 2021/2022 financial year.
On 4 November 2021, Ms Gail Connolly, general manager at Council, sent a letter to Mr Brett Whitworth, deputy secretary of the Office of Local Government (OLG) seeking approval to give PANs to "all owners" of the property in accordance with Council's resolution of 26 April 2016. There were a number of attachments to Ms Connolly's letter, including correspondence between Council and the first applicant, Perry Properties, as well as the registered leaseholder, the fourth respondent, for the purpose of negotiations pursuant to the Just Terms Act. Ms Connolly wrote: It will be observed from the correspondence provided at Attachment 5 that the registered proprietor has refused to progress negotiations, whilst negotiations between Council and the holder of the registered lease are progressing and may lead to agreement as to the amount of compensation to be paid for the lessee's interest. It will be further observed that Council was not permitted to inspect the interior of the property until February 2021. As noted above, periodic negotiations have occurred between Council and the registered proprietor over several years, both before and after Council resolved on 26 April 2016 to acquire the property by way of compulsory acquisition subject to the consent of the Minister….
The correspondence referred to as "Attachment 5" to Ms Connolly's letter is a series of letters and emails in the period between 11 February 2020 and 18 August 2021, primarily between Mr Allison of Council and Vince Perry, in relation to Council's interest in acquiring the property, an appropriate valuation of the property, and the lease held by the fourth respondent, International Buddhist Association.
By letter dated 26 November 2021, Ms Stepanka Halik, manager performance at the OLG, responded to Ms Connolly's letter of 4 November 2021 as follows: The Office of Local Government (OLG) has reviewed the information provided with this request. Unfortunately, Council has not provided all the information necessary for its proposal to be assessed or recommended for approval. I refer you to the OLG Guidelines for the Compulsory Acquisition of Land by Councils…Council must complete the application form found at Annexure 2 of the Guidelines and submit it, together with all of the required information, before its proposal can be assessed.
By letter dated 2 December 2021, Mr Allison of Council responded to Ms Halik's letter of 26 November 2021, enclosing "the necessary application form and 2 copies of the marked registered plan". One of those attachments was an "Application for the Compulsory Acquisition of Land" dated 1 December 2021. In relation to question 2, "Council's Resolution to Acquire Land", at 2.1 "Date of resolution", Mr Allison wrote "26 April 2016". In relation to question 4, "Purpose of Acquisition", Mr Allison wrote: The land is being acquired for the public purpose of providing public recreation space. It is zoned RE1 - Public Recreation and reserved for public acquisition in Georges River Local Environmental Plan 2021. In relation to question 9, "Re-sale" of that application, in response to question 9.1, "Does council intend to sell the land once the land is acquired?", Mr Allison circled the answer "No".
On 13 December 2021, Ms Halik responded to Council's correspondence, including "Application for the Compulsory Acquisition of Land" dated 2 December 2021, stating: The Office of Local Government (OLG) has reviewed the information provided and note that it does not contain all the required information. In order for OLG to continue its assessment of Council's application, the following information must be provided. Council resolution authorising an application to the Minister and the Governor The resolution of the Council meeting of 26 April 2016 does not authorise making an application to the Minister and the Governor. Under section 377 of the Local Government Act 1993, the making of an application to the Governor and Minister are non-delegable functions of Council. The resolution submitted with the application is not sufficient for an application to compulsorily acquire land. A fresh resolution expressly authorising the making of an application to the Minister and the Governor for approval to compulsorily acquire Lot 1 DP 301901 is required. … Copy of Council's title search Council's title search for Lot 1 DP301901 was not included in Council's application. Please provide a copy of this search, ensuring the search was conducted less than 12 months ago.
On Friday, 25 February 2022, an agenda was circulated for Council's meeting to be held on Monday, 28 February 2022. It was recommended that the agenda item in relation to the proposed acquisition of the property be considered in a closed meeting at which the press and public were excluded on the basis that the information relevant to the matter "would, if disclosed, confer a commercial advantage on a person with whom the Council is conducting (or proposes to conduct) business."
Clauses 13.9 to 13.17 of the Georges River Council Code of Meeting Practice June 2019 (the Code) make provision in relation to representations by members of the public as to parts of Council meetings that are to be closed to the public. Relevantly, clauses 13.9 to 13.12 provide as follows: 13.9 The council, or a committee of the council, may allow members of the public to make representations to or at a meeting, before any part of the meeting is closed to the public, as to whether that part of the meeting should be closed. Note: Clause 13.9 reflects section 10A(4) of the [LGA]. 13.10 A representation under clause 13.9 is to be made after the motion to close the part of the meeting is moved and seconded. 13.11 Where the matter has been identified in the agenda of the meeting under clause 2.20 as a matter that is likely to be considered when the meeting is closed to the public, in order to make representations under clause 13.9, members of the public must first make an application to the council in the approved form in accordance with Clause 3.2 of this code. Applications must be received by 12.00pm on the day of the meeting at which the matter is to be considered. 13.12 The General Manager (or their delegate) may refuse an application made under clause 13.11. The General Manager or their delegate must give reasons in writing for a decision to refuse an application.
On the afternoon of Friday, 25 February 2022, the solicitor for the first applicant, Perry Properties, Mr Nathan Weinberger, sent a letter by email to each of the Councillors in relation to the designation of the agenda item to be considered in closed session at Council's meeting on 28 February 2022. Mr Weinberger stated: "we do not understand why, in circumstances where the proposed compulsory acquisition is for a 'public purpose', why the meeting should be closed to the public on the basis of commercial confidentiality".
On the evening of Friday, 25 February 2022, Ms Connolly (Council's general manager) sent an email to Council officers, including Mr Allison, under the subject line, "CM9: Text message sent to all Councillors today from Vince Perry - Princes Hwy Acquisition". Attached to that email was a screen shot of a text message sent by "Colleen", stating "Just received", and relaying a text message received on 25 February 2022 from the second applicant, Vince Perry. In that text message, Mr Perry said: Please note that my lawyers, Weinberger Lawyers, has sent the councillors a letter for further clarifications. Please reply urgently. Furthermore, I dispute that there is a proper public purpose. Further, I dispute that there has been a genuine negotiation with council staff…
A report to Councillors for their meeting on Monday, 28 February 2022 provided as follows in relation to the acquisition of the property: 6. …There are currently various proposals for a comprehensive public sector redevelopment of this Jubilee Stadium "precinct" although these are not immediately relevant to the proposed acquisition. … 9. There have been periodic negotiations for an acquisition of the property by agreement with the owner over several years, but these have not been successful. In essence, the owner has never wanted to sell and that remains the owner's current position. … 11. The resolution of 26 April 2016 was not immediately acted upon, likely due to issues arising from the then merger of the former Kogarah City Council and the former Hurstville City Council which lead to the formation of Georges River Council on 12 May 2016. However, it should be noted that while an offer was made to the owner in October 2016, no further approaches were made until the Master Plan for the precinct was completed in early 2020.
The minutes of Council's meeting held on Monday, 28 February 2022 record as follows in relation to the acquisition of the property: The Mayor, Councillor Katris asked the General Manager if any representations had been received from the public that the item should not be discussed in closed session. The General Manager replied that no representations had been received to the item in closed session. The Mayor asked if there were any members of the public gallery who would like to speak on the reasons Council proposes to consider the items in Closed Session. There were none. … Note: Council moved to Closed Session at 11:12pm.
In the closed confidential session, Council adopted the resolution in relation to the property set out above at [6].
Also on 28 February 2022, the Hon Courtney Houssos MLC sent a letter to Mayor Nick Katris of Council. The letter was written on behalf of the fourth respondent, the lessee of the property, seeking clarification about the proposed acquisition of the property. Ms Houssos said: It is my understanding that a compulsory acquisition is taking place in order to make way for the development of a sporting facility. To the best of my knowledge, this is occurring without a Development Application, allocated funding or general agreement amongst the Councillors for the proposed site. If this is the case, can you please advise why the compulsory acquisition is taking place?
Mr Katris responded to Ms Houssos on 17 May 2022 as follows: The site remains zoned RE1 - Public recreation and is reserved for acquisition in the Georges River Local Environment Plan 021. The open space zoning and reservation of the site for compulsory acquisition has existed for 46 years. In response to previous resolutions of Kogarah Council and community requests, on 28 February 2022 Council unanimously resolved to proceed with the acquisition of the property so that it can be brought into public ownership. As can be seen from the long history of this matter, the recent decision by Council is not related to any future development of a sporting facility adjacent to the site.
On 4 March 2022 and 22 March 2022, Mr Allison of Council sent an email to Ms Halik at the OLG, attaching the minutes of Council's meeting of 28 February 2022, a copy of the report prepared for Council's meeting of 28 February 2022, a copy of the result of a title search made on 4 March 2022 in relation to the property, and "[f]urther relevant copy correspondence".
Mr Allison did not provide to the OLG a copy of Mr Weinberger's letter of 25 February 2022, or the text message from Vince Perry referred to above at [50].
On 28 March 2022, Council held another meeting at which it adopted, in closed session, the following resolution: (a) That following acquisition of the land described as Lot 1 in Deposited Plan 301901 at 247 Princes Highway, Carlton, Council resolves to preserve the building known as the 'Old Kogarah Inn,' for its heritage significance, as identified in Schedule 5 of Georges River Local Environment Plan 2021, and to continue to make the building available for appropriate community use into the future. (b) That Council consider prioritising $50,000 funding during the preparation of the draft 2022/23 Budget for the preparation of an updated heritage assessment for the site.
On 29 April 2022, the OLG provided a briefing document to the Minister, recommending approval to "commence pre-acquisition procedures for the acquisition of [the property] by giving PANs to the landowners."
On 29 April 2022, the Minister approved Council's proposed acquisition of the property "for the purpose of public recreation space in accordance with the RE1-Local Open Space reservation made under the Georges River Local Environmental Plan 2021".
On 5 May 2022, Ms Janelle Waterson, senior assessment officer at OLG, sent an email to Mr Allison of Council, informing him that on 29 April 2022, the Minister had approved Council giving PANs to "the registered landowner - Perry Properties Pty Limited, the registered lessee - International Buddhist Association of Australia Co-operative Limited, and the registered mortgagee - National Australia Bank."
On 10 May 2022, a call option deed was entered into between the first applicant, Perry Properties, and each of the second to sixth applicants (the call option deed). Perry Properties granted an option to the option grantees to purchase the property at 247 Princes Highway. The option fee was for the sum of $50,000, payable on the date of the deed. On the same day, the first applicant, Perry Properties, as trustee for the Perry No 1 Trust, made a trustee resolution to enter into the call option deed with the option grantees. An amount of $10,000 was offset against each of the option grantees' beneficiary loan accounts to pay the $50,000 option fee.
On 8 June 2022, the option grantees registered the caveat, caveat AS201292, on title to the property.
On 17 June 2022, Council gave a PAN to the first applicant, Perry Properties, post-dated to 29 June 2022. On 19 June 2022, Perry Properties advised Council of the existence of the caveat. On 24 June 2022, Council sent PANs to the option grantees, being the second to sixth applicants, which notices were also post-dated to 29 June 2022.
On 16 February 2023, Mr Weinberger, solicitor for the applicants, sent a letter to HWL Ebsworth, solicitors for Council, requesting that Council answer the following questions (emphasis in original): Is Council going to use the Premises, after acquisition, as a pub, restaurant or a licensed café? Is it going to be part of a hotel and/or serviced apartments? If not, what precisely is the Premises intended to be used for?

Ground 1 - Alleged breach of s 186 and/or s 188 of the LGA

In Ground 1, the applicants contend that Council breached ss 186 and/or 188 of the LGA on the basis that it was not acquiring the property for a proper purpose. The applicants submitted that the evidence "suggest[ed]" that Council's purpose was to acquire the property to be used as a licensed venue and/or to be earmarked for "saleable development", neither of which would be for a proper purpose. At the hearing, I asked the applicants' counsel what the applicants say was the unauthorised or improper purpose, observing that the summons provided no particulars in relation to Ground 1. Ms Pearman, counsel for the applicants, replied: An improper purpose would be a purpose by which the council were able to deal in the land as a commercial venture… Council cannot be a developer or, effectively, securing property for commercial opportunities for itself, that the classification of this land as community land is land that ought be reserved for a proper community purpose… or a resaleable development or resaleable land, which it has not notified to the Minister, because on the form it's notified as know [sic] that it doesn't intend to resell the land.
Elsewhere, Ms Pearman said that Council's purpose was "for some sort of commercial lease or commercial opportunity."
In relation to Ground 1, the applicants relied on Samrein Pty Ltd v Metropolitan Water, Sewerage and Drainage Board (Samrein), [1] in which the High Court (Gibbs CJ, Mason, Murphy, Wilson and Brennan JJ) held at 468-469 that the purposes for which the acquiring authority proposed to acquire the land were purposes of the Metropolitan Water, Sewerage and Drainage Act 1924 (NSW). The applicants submitted, and I accept, that if the acquiring authority was seeking to acquire the land for an ulterior purpose, there would be an ostensible, but not a real exercise of the power granted by the Act. Further, the attempted exercise of power would be vitiated even if the ulterior purpose was not the sole purpose of the acquisition. It would be an abuse of the acquiring authority's powers if the ulterior purpose was a substantial purpose in the sense that no attempt would have been made to acquire the land if it had not been desired to achieve the unauthorised purpose. [2]
It is clear that the point of time for assessing purpose is at the time of the exercise of power, which, in this case, was at the time of issuing the PANs, that is, 29 June 2022. However, the applicants submitted, and I accept, that preparatory acts are also relevant to establishing purpose: see Roads and Maritime Services v Desane Properties Pty Ltd (Desane). [3] I accept the applicants' submission that a purpose is not invalidated because there is a risk that the purpose may not at some future point be realised. [4]
It is also clear that where an improper or unauthorised purpose is alleged, the party impugning a decision is not confined to the document that is said to formally record the decision, but may go behind the decision to seek direct and indirect evidence of the decision maker's state of mind. [5] This includes documents brought into existence by, and received by the decision maker. Here, the applicants submitted that the "controlling mind" of Council's decision to acquire the property was that of Mr Coleman.
The evidence establishes that Council first resolved on 26 April 2016 to acquire the property by way of compulsory acquisition subject to the consent of the Minister. No further approach in relation to the acquisition of the property was made to the first applicant, Perry Properties, until early 2020.
In October 2017, Council issued the request for quotation for "Consultancy Services - Master Plan for the Jubilee Oval Precinct" (herein referred to as the RFQ). In the RFQ, Council recorded under the heading "project purpose": "Consolidation of the land parcels in the precinct is an additional focus of this project". The RFQ also recorded: It is anticipated that concept options should include the following considerations: … PRECINCT … 10. Explore accommodation on the site such as serviced apartments or accommodation hotel.
The RFQ resulted in the preparation of two master plans: the 2018 Master Plan and the 2020 Master Plan. The 2020 Master Plan (referred to above at [40]) provided as follows: 1. in Option 4, the property was shown between a proposed hotel and a proposed 5 level mixed commercial/residential building; 2. also in Option 4, there was stated to be "development opportunities (500ms and 700ms) highlighted along Princes Highway [which] will reduce the public open space"; and 3. in Options 3A and 3B, the cost estimates scheduled referred to "[s]aleable development at the south edge along Princes Highway- hotel - resi - retail front" with reference to item number "18 TBC".
However, in relation to the cost estimates schedule, item number 18 did not align with Kogarah Hotel, being item number 15 in the diagram in the 2020 Master Plan referred to above at [39]. The applicants submitted that while there was no correlation between the property and item number "18 TBC", the "saleable development" was still a reference to the property, being at the southern edge of the plan, along the Princes Highway. They submitted that the proposed accommodation hotel development was on the eastern edge, the only other hotel being the former Kogarah Hotel on the southern edge, and that the only other development proposed along the southern edge was a commercial/residential development, not a hotel development. I do not accept this submission. I do not consider it safe to draw the inference that the reference to "18 TBC", or that the description of the "saleable development at the south edge along the Princes Highway", are references to the property.
On 28 February 2022, the report to Council, considered at Council's meeting on the same day, recommended seeking the approval of the Minister and advised: "There are currently various proposals for a comprehensive public sector redevelopment of this Jubilee Stadium 'precinct' although these are not immediately relevant to the proposed acquisition."
The report also referred to the former Kogarah City Council's 26 April 2016 resolution to acquire the property by way of compulsory acquisition. The report noted as follows: "while an offer was made to the owner in October 2016, no further approaches were made until the Master Plan for the precinct was completed in early 2020."
At its meeting on 28 February 2022, Council adopted the resolution extracted above at [6], including that the land be classified as community land. Council submitted that this resolution is the best evidence of the purpose of the proposed acquisition of the property, and that the documents referred to by the applicants do not show that Council proposed to use the property as a licensed venue, or as a saleable development, or for any purpose other than that consistent with its zoning and proposed classification as community land under the LGA.
At the hearing, the applicants submitted that the Court should view Council's assertion in relation to community land with scepticism. Counsel for the applicants referred to a document titled "Georges River Council - Land Register" which identified the classification of the subject property and its surrounding parcels of land on the corner of Princes Highway and English Street under the GRLEP (the location of those parcels are shown in the cadastral map at [27] above). The surrounding parcels were also classified as community land, with the exception of one being operational land. The applicants referred to diagrams in the 2020 Master Plan which identify land crossing over those parcels as an "opportunity" to construct both a hotel and residential/commercial building. The applicants submitted that these documents indicate "what appears to be [Council] potentially intending to use community land for high-rise apartments", and that the inference to be drawn would be that those developments "would need to be saleable developments".

Re-sale

In relation to the applicants' contention that the purpose of the acquisition was for the property to be earmarked for saleable development, I find as follows.
I accept that if the purpose of the acquisition of the property were for it to be sold to a third party, this might contravene s 188 of the LGA (set out above at [18]), which restricts the compulsory acquisition of land for the purpose of re-sale without the approval of the owner of the land.
However, I am not satisfied on the basis of the scant evidence relied upon by the applicants that Council at any relevant time had as its purpose the acquisition of the property for its re-sale. The evidence relied upon by the applicants reduces to a series of inferences sought to be drawn from the RFQ and 2020 Master Plan including, in particular, the "Commercial Opportunity" identified as Option 4 in that master plan, a vague reference to a "saleable development" in relation to Options 3A and 3B, the location of the property being between a proposed hotel and commercial/residential building, and the 28 February 2022 report to Council which refers to other proposals for redevelopment of the precinct that are "not immediately relevant to the proposed acquisition".

Licensed venue

In relation to the contention that the purpose of the acquisition was for the property to be used as a licensed venue, I find as follows.
On 28 February 2022, at the meeting of Council at which Council resolved to proceed with the acquisition of the property, Council also resolved that the property be classified as community land, in accordance with s 31 of the LGA. Community land is defined in the Dictionary as "land that is classified as community land under Division 1 of Part 2 of Chapter 6".
Subsection 45(2) provides that a council may grant a lease of community land, but only in accordance with this Division (that is, Division 2 of Part 2 of Chapter 6 of the Act): 45 What dealings can a council have in community land? (1) A council has no power to sell, exchange or otherwise dispose of community land. (2) A council may grant a lease or licence of community land, but only in accordance with this Division.
Subsection 46(1) provides for limited circumstances in which a lease may be granted in respect of community land: 46 Leases, licences and other estates in respect of community land - generally (1) A lease, licence or other estate in respect of community land - (a) may be granted for the provision of public utilities and works associated with or ancillary to public utilities, or … (b) may be granted, in accordance with an express authorisation in the plan of management and such provisions of the plan of management as apply to the granting of the lease, licence or other estate - (i) for a purpose prescribed by subsection (4), or for a purpose prescribed by any of sections 36E to 36N as a core objective of the categorisation of the land concerned, or (ii) for a purpose prescribed by the regulations, if the plan of management applies to several areas of community land, or (iii) for a short-term, casual purpose prescribed by the regulations, or (iv) for a residential purpose in relation to housing owned by the council, or … (c) may be granted in order to allow a filming project to be carried out, whether or not the project is in accordance with the plan of management or is consistent with the core objectives of the categorisation of the land concerned, but may not otherwise be granted.
Subsection 46(2) provides, relevantly, that despite subsection (1), a lease in respect of community land "may be granted for a purpose mentioned in subsection (1)(b) only if the purpose for which it is granted is consistent with the core objectives, as prescribed in this Part, of its categorisation."
Subsection 46(4) provides that the following purposes are prescribed for the purposes of subsection (1)(b)(i): (a) the provision of goods, services and facilities, and the carrying out of activities, appropriate to the current and future needs within the local community and of the wider public in relation to any of the following - (i) public recreation, (ii) the physical, cultural, social and intellectual welfare or development of persons, (b) the provision of public roads.
And subsection 46(6) provides that "a plan of management is void to the extent that it purports to authorise the grant of a lease, licence or other estate in contravention of this section."
I accept that the 2018 Master Plan and 2020 Master Plan provide some (scant) evidence in relation to the possibility of the existing Kogarah Hotel on the property being operated as a licensed venue and/or leased to a third party. In particular: 1. in 2018, following the two stakeholder workshops (referred to above at [28]-[29]), at which master plan strategies were explored, there is a reference in an e-mail from a BVN employee to Urbis and Arup under the heading "Precinct (various options which we can feed into the different oval configurations)" of "Park extend[ed] to include Kogarah Hotel as a free standing pub/café…"; and 2. in the 2020 Master Plan at Option 3, the property is identified in a pictorial as a pub or bar (see the first image above at [38])
The applicants submitted that having regard to the terms of the Liquor Act 2007 (NSW) (Liquor Act), Council could not in its own right obtain a liquor licence for a hotel (a pub) or restaurant, with the result that the holder of any liquor license must be a tenant. They submitted that Council is not a "corporation", and therefore cannot apply for a "hotel licence" required for a pub or other liquor licence (other than the limited function related licences).
I accept that under the Liquor Act, Council is a "non-proprietary association". Plainly, the definition of non-proprietary association in s 4 of the Liquor Act includes in (b), "a local council". However, there is in s 6(5) an exemption for fundraising functions held by non-proprietary associations. Likewise, there are limited circumstances in which non-proprietary associations can apply for licences for function-related activities.
The applicants have not established that any use of the property for the purpose of a licensed venue would be contrary to its classification as community land under the LGA. The applicants' submissions assume that seeking to lease the property for the purpose of a licensed venue would be contrary to the statutory restrictions placed on community land. However, that would not be the case if an appropriate plan of management were in place. I accept Council's submission that the applicants' submissions proceed on a flawed understanding of the Liquor Act. The submission that Council cannot be the holder in its own right of a liquor licence overlooks that under s 220(1) of the LGA, Council has the legal status of an individual, and under s 40(2)(a) of the Liquor Act individuals may apply for liquor licences.
Further, I consider, as submitted by Council, that Council can be both an individual holder of a liquor licence, and also have the benefit of the non-proprietary association provisions in the Liquor Act. The two statutory regimes are not mutually exclusive.
In any event, I do not need further to consider the provisions of the Liquor Act, and their application to the alleged purpose of Council's acquisition here. That is because I am not satisfied on the basis of the scant evidence relied on by the applicants that the purpose of the acquisition was to ultimately lease the former Kogarah Hotel to a private operator as a pub/bar or licensed restaurant.
Nor was there any evidence, beyond a pictorial in the 2020 Master Plan and an internal email between the consultants referring to a "free standing pub/café", that in seeking to acquire the property, Council's purpose was itself to operate any such pub/bar or licensed restaurant.

Premature

Alternatively, in relation to Ground 1, the applicants submitted that the acquisition of the property was premature.
In relation to this contention, the applicants relied on the report to Council for its 28 February 2022 meeting which said, "[t]here are currently various proposals for a comprehensive public sector redevelopment of this Jubilee Stadium 'precinct' although these are not immediately relevant to the proposed acquisition." The applicants submitted that the Court should read that statement to mean that those other "various proposals" did have some relevance to the proposed acquisition of the property, but were not "immediately relevant" in a temporal sense on the basis that the project is a staged development, where the third stage may not occur until some seven years after the commencement of development.
The applicants also relied on the report to Council for its meeting on 28 March 2022, the month following Council's resolution of 28 February 2022 to acquire the property, where Councillor Borg noted that "the current tenant will be permitted to remain in occupation under a suitable commercial arrangement, until such time as the property is required for public recreation purposes in accordance with the original purpose of the reservation for acquisition."
However, in light of the evidence before me, there is no sound basis upon which to draw the inference that the proposed acquisition was premature. In its RFQ, Council anticipated that "the project will take place in stages of development broadly identified as follows…Stage 3, 0-7 years Built form - commercial; retail; serviced apartments or hotel" (see above at [26]).
I was taken to nothing in either the LGA or the Just Terms Act that mandates a time frame for acquisitions in relation to the carrying out of the public purpose for which land is acquired. To the contrary, s 71A of the Just Terms Act (which relates to the right of first refusal for a former owner if land is no longer needed for a public purpose up to 10 years after acquisition) strongly suggests that there can be a significant period after an acquisition during which the implementation of a public purpose is being planned for, is delayed or is simply not yet pursued.
I do not consider there to be any sound basis in the evidence, or on authority, upon which to draw the inference that Council's acquisition of the property was premature.

Bare statement

Further, in relation to Ground 1, the applicants submitted that Council's documents demonstrated no more than a "bare statement" of purpose. The applicants referred in particular to the following: 1. Council's application to the Minister for approval to issue the PANs which stated the purpose of the acquisition as: "for the public purpose of providing public recreation space." 2. The minutes of Council's meeting of 28 February 2022 which stated the purpose of the acquisition as "for the purposes of providing public recreation space", and the minutes of Council's meeting of 28 March 2022 which stated the purpose as to "preserve the Premises for its heritage significance and to continue to make the building available for appropriate community use into the future".
There is no express requirement in the Just Terms Act for a PAN to state the public purpose for which acquisition is sought. The applicants submitted that in Desane, the Court of Appeal identified at least two bases on which more than a "bare statement" of public purpose must be identified: 1. firstly, having regard to the principle of legality, where the question of whether the purpose of a particular acquisition falls within a particular acquisition power is in issue. This would apply where the landowner needed to be satisfied that the public purpose was a permitted purpose; [6] and 2. secondly, as part of the content of good faith negotiations required by the Just Terms Act which "plainly includes the requirement upon an acquiring authority, if asked, to provide such information about an acquisition as to permit a landowner to negotiate about sale price", [7] and is "likely to go far beyond the mere description of the 'public purpose' of the acquisition". [8]
The applicants submitted that if Council acquired the property now on a "bare statement" of public purpose, and subsequently leased the land to a private operator, or re-sold the property, any remedies would not assist them, their property rights having been extinguished.
I consider the submissions of the applicants in support of Ground 1 in relation to what is said to be a "bare statement" to be misconceived. While the Court of Appeal in Desane concluded that the acquiring authority would need to provide information regarding the public purpose, if asked, during negotiations under s 10A of the Just Terms Act, the context of the Court's consideration was whether a PAN was required to include a statement regarding the public purpose. The Court held that it did not. [9] The ratio of the Court was not that a "bare statement" of the public purpose can never be sufficient to identify the public purpose. Rather, the Court indicated that the degree of information required would depend on the circumstances, including various matters within the acquiring authority's knowledge that may impact the value of the land. [10]
I am satisfied that, in this case, the description of the public purpose by Council went beyond a "bare statement". The stated purpose of the acquisition recorded in the minutes of Council's 28 February 2022 meeting was "for the purpose of providing public recreation space", and in the minutes of 28 March 2022 to "preserve the Premises for its heritage significance … and to continue to make the building available for appropriate community use into the future". These descriptions of the purpose of the acquisition are to be understood in the context of the RE1-Public Recreation zoning that applied to the property under the GRLEP, the listing of the former Kogarah Hotel as a heritage item in Part 1 of Schedule 5 to the GRLEP, and the proposed classification of the property as community land.

Disposition of Ground 1

In relation to Ground 1 generally, Council submitted that under s 24 of the LGA, a council may provide goods, services and facilities, and carry out activities, appropriate to the current and future needs within its local community and of the wider public, subject to the LGA, the regulations, and any other law.
I accept that the provision of public recreation falls within the ambit of s 24 of the LGA. The applicants did not suggest otherwise. Section 23 of the LGA extends to permitting Council to do all such things as are supplemental or incidental to, or consequential on, the exercise of its functions. Again, the applicants did not suggest otherwise.
Likewise, Council submitted, and the applicants did not submit otherwise, that the purpose for which an acquiring authority seeks to acquire land must be a purpose permitted by the relevant statute. In the absence of that, the acquisition would be of no effect. Samrein is clear authority for the proposition that a statutory power to acquire may not be exercised for an ulterior purpose; that is, if the ulterior purpose is the substantial purpose of the acquisition, in the sense that no attempt would have been made to acquire the land if it had not been desired to achieve the unauthorised purpose. [11]
The applicants have not established that the PANs were given and that the acquisition of the property is being pursued for an unauthorised purpose. There is nothing, persuasive, in the evidence that suggests that the substantial purpose of the acquisition was for anything other than for the lawful purpose of public recreation.
Section 186(2)(a) of the LGA enables Council to acquire land that is to be made available for any public purpose for which it is reserved or zoned under an environmental planning instrument. As Council submitted, the zoning of land for public recreation is a typical way Council enables the provision of land for publicly accessible areas such as parkland, sporting fields, walking and cycling tracks, swimming pools, and associated and incidental community facilities.
In this case, the property was zoned Open Space under the Kogarah Planning Scheme Ordinance from 29 October 1976. From 25 January 2013, the Kogarah Local Environmental Plan 2012 zoned the Land RE1-Public Recreation, and reserved it for acquisition by the former Kogarah Council. On 8 October 2021, the GRLEP zoned the Land RE1-Public Recreation, and reserved it for acquisition by Council. At all relevant times, the property was identified for use as local open space. It adjoins Kogarah Park and is adjacent to Jubilee Stadium.
I find that the proposal to acquire the property for the purpose of public recreation is consistent with and evident from its zoning (both historic and at the time the PANs were given), and from the resolution of Council on 28 February 2022 which was adopted unanimously.
In Ground 1, the applicants seek to controvert the clear documentary record which establishes the pursuit of the acquisition for an authorised purpose. I have found that Ground 1 reduces to unsupported assertion and speculation.
There was no reliable evidence before the Court that Council proposes to use the property as a licensed venue or as a saleable development or for any purpose other than one consistent with its zoning and its proposed classification as community land under Part 2 of Chapter 6 of the LGA. The applicants' references to Telstra Corporation v Hurstville City Council (Telstra) [12] and Webber v Racing New South Wales [2017] NSWSC 687 (Webber) [13] are accurate to the extent that they support a submission that where a properly based allegation of unauthorised or improper purpose is made, it is permissible to go and seek direct and indirect evidence of the decision maker's state of mind behind a formal resolution of a council to discern the purpose of its action. However, the relevant passage in Telstra confirmed as correct the trial judge's acceptance of a submission that: [14] … the purposes of, and considerations taken into account by, Councils are best inferred from the documents brought into existence by their officers (primarily reports to the Council but also memoranda and the like leading up to those reports) and the resolutions of the Councils in response thereto. In particular, where a recommendation is adopted without more, it can and ought properly be inferred that the 'intentions, purposes, motives, beliefs and state of mind' of the Council (as a collegiate body) are as disclosed in the reports and other documents brought into existence by its officers.
None of the material referred to by the applicants as evidence of an ulterior or unauthorised purpose can be characterised as the subject of a decision by Council or as indicative of the collegiate body's state of mind at the time relevant steps in relation to the acquisition of the property were taken.
Firstly, the proposals to acquire the property pre-date any master planning process in relation to the Jubilee Stadium Precinct. This is demonstrated by the reservation of the property for acquisition under both the current GRLEP and its predecessors referred to above at [112].
Secondly, neither of what the applicants have referred to as the 2018 Master Plan or the 2020 Master Plan has been adopted by Council by way of resolution. I do not accept that the reported "approval" of a draft plan by Council's executive manager premium facilities and properties communicated to consultants BVN (see above at [36]) constitutes any evidence on which to found the applicants' submission that Council has sought to acquire the property for an unauthorised purpose.
Even assuming that the prospect of the redevelopment of the Jubilee Stadium Precinct was a factor in Council's decision to acquire the property (a proposition which Council denied and is contrary to the report to Council of 28 February 2022), the applicants have not identified why any such decision would be contrary to Council's powers under s 186 of the LGA. The draft 2020 Master Plan does not identify the property as part of the area identified for potential future re-sale. In any event, such a re-sale would be inconsistent with Council's resolution of 28 February 2022 to classify the property as community land which, under s 45 of the LGA, would likely constitute a statutory prohibition upon Council reselling the property.
Council's resolution of 28 February 2022 is the best evidence of Council's intention that the property not be re-sold. In its resolution, Council proposed a community classification which would likely make re-sale of the property prohibited. That Council's purpose was not to re-sell the property is evidenced by Council's application to the Minister for approval to issue the PANs in which Council expressly stated that it did not intend to sell the property once acquired (see above at [45]). As Council submitted, it is close to impossible to draw any inference, let alone a reasonable inference, from documents obtained from consultants and not adopted by Council to go behind, and supplant, Council's resolution.
The applicants have failed to discharge their burden to establish any basis for concluding that Council's acquisition of the property was not for the purpose of Council's functions under the LGA. Ground 1 of the further amended summons is dismissed.

Ground 2 - Alleged misleading of the Minister as to the purpose of the acquisition, and the 28 February 2022 meeting of Council in closed session

In relation to Ground 2, the applicants contended that there was a breach of s 187 of the LGA because Council did not obtain the valid approval of the Minister for two reasons: 1. Firstly, the Minister was misled as to the purpose of the acquisition, stated to be for the purpose of providing "public recreation space". 2. Secondly, the Council meeting resolving the proposed acquisition was held in closed session, ignoring the objection of the first applicant, and this objection was not disclosed to the Minister.
The applicants submitted that the Minister's approval was dependent upon correct information being provided in Council's application to the Minister dated 1 December 2021 for approval of the proposed acquisition. Neither the 2018 Master Plan nor the 2020 Master Plan were provided to the Minister as part of Council's application. The evidence in both master plans, set out above at [73], was submitted to be inconsistent with the purpose of acquisition stated in Council's application as "providing public recreation space", and with the negative answer provided to question 9.1 in the application to the Minister as to whether the Council intended to sell the property once acquired (see above at [45]).
The applicants relied on the observations of Smart AJA in Gaffney v Camden Council that a council, when seeking approval from the Minister, should supply the Minister with full details including the areas to be acquired and the purpose or purposes of the acquisition. [15] In that case, Mason P said that the Court would require persuading that an acquisition based upon an approval obtained as the result of a failure to inform the Minister of the true purpose of the acquisition, was a valid acquisition. [16]
As set out above at [52]-[53], on 28 February 2022, Council resolved to acquire the property in closed session. The Code (as then applicable) allowed members of the public to make representations as to whether any part of the meeting should be considered in closed session. Prior to the 28 February 2022 meeting, on 25 February 2022, Weinberger Lawyers sent a letter to each of the Councillors on behalf of the first applicant (Perry Properties) seeking Council's reasons for designating the matter to be considered in closed session (see above at [49]).
The minutes of the 28 February 2022 meeting record the following: The Mayor, Councillor Katris asked the General Manager if any representations had been received from the public that the item should not be discussed in closed session. The General Manager replied that no representations had been received to the item in closed session.
It is not disputed that the letter of the first applicant's solicitor of 25 February 2022 seeking Council's reasons for designating the matter to be held in closed session of Council was not provided to the Minister. The applicants submitted that the Minister should have been informed that an objection to the closed session had been made and that the Minister was, in the circumstances, misled. They referred to authority for the proposition that a decision of a Minister may be challenged if incorrect or incomplete information is provided. [17]
In relation to the first aspect of the allegation in Ground 2 (namely, that Council, in its application to the Minister for approval to issue the PANs under s 187 of the LGA, misled the Minister as to the public purpose of the acquisition), Council submitted that the finding sought was contingent on the Court making a finding in the applicants' favour in respect of Ground 1. I have concluded that the applicants have failed in their challenge in Ground 1 in relation to the purpose of the acquisition. Accordingly, I do not consider this aspect of the allegation in Ground 2.
In relation to the second aspect of the allegation in Ground 2 (concerning Perry Properties' "objection" to Council dealing with the proposed acquisition in closed session), the applicants did not identify any statutory basis on which they contended that Council was obliged to notify the Minister of an objection to the closing of a council meeting.
Nor do I accept the applicants' submission that the closing of Council's meeting on 28 February 2022 was unlawful. Subsections 10A(1) and (2)(c) of the LGA provide for a meeting to be closed if it involves discussion of information of a confidential matter that would, if disclosed, confer a commercial advantage on a person with whom the council is conducting (or proposes to conduct) business. Subsection 10A(4) provides that a council may allow members of the public to make representations to or at a meeting, before any part of the meeting is closed to the public, as to whether that part of a meeting should be closed.
Council was required by s 360 of the LGA to adopt a code of meeting practice for the conduct of meetings of councils and committees of councils of which all the members are councillors. Here, the relevant code was the Code of Meeting Practice June 2019 (referred to herein as the Code). Subsection 360(5) of the LGA relevantly requires council meetings to be conducted in accordance with the code of meeting practice adopted. Clauses 13.9 to 13.17 of the Code (some of which are extracted above at [48]) provide how members of the public can make representations as to whether part of a meeting should be closed. I do not consider Mr Weinberger's letter to each of the Councillors dated 25 February 2022 to be a letter of objection at all, let alone one for the purpose of the Code. It was not a representation in the approved form. It did not, in its terms, object to the meeting being closed, and it was not sent to the general manager of Council. Likewise, the text message sent by Mr Perry to the Councillors on 25 February 2022 (set out above at [50]) suffers from the same defects.
For these reasons, the applicants have failed to discharge their burden that there was anything misleading in Council's application to the Minister for the purpose of s 187 of the LGA. Ground 2 of the further amended summons is dismissed.

Ground 3 - Alleged non-compliance with s 10A of the Just Terms Act

In relation to Ground 3, the applicants submitted that as caveators, the second to sixth applicants have a requisite "interest" in the property to be acquired.
An "interest" in land is defined in s 4 of the Just Terms Act as: (a) a legal or equitable estate or interest in the land, or (b) an easement, right, charge, power or privilege over, or in connection with, the property. The applicants submitted that each of the option grantees was therefore an "owner" of the property.
They submitted that Council had proceeded contrary to s 10A(2) of the Just Terms Act, which requires the authority of the State "to make a genuine attempt to acquire the land by agreement for at least 6 months before giving a proposed acquisition notice", there having been no negotiation with any of the option grantees prior to the issue to them of a PAN. They submitted that s 10A(6), set out above at [19], and which may exempt an acquiring authority from negotiation, had not been satisfied.
In Desane, the Court of Appeal referred to s 10A of the Just Terms Act, saying at [162]: 162. The requirement to negotiate for a period of six months prior to the issue of a PAN is a provision of some importance.
And at [205]: 205. The essential precondition to acquisition of land is notification in the Gazette: s 19. The Just Terms Act provides for a six month negotiating period before an authority of the State can issue a PAN: s 10A. At the very least, a landowner has the protection of an opportunity to negotiate with the acquiring authority for that period.
And at [258]: 258. A critical feature of the Just Terms Act is the requirement for a six month period of negotiation between a landowner and an acquiring authority prior to the issue of a PAN: s 10A… The content of good faith negotiations required by the Just Terms Act plainly includes the requirement upon an acquiring authority, if asked, to provide such information about an acquisition so as to permit a landowner to negotiate about a sale price.
Following Desane, in Elmasri v Transport for NSW (Elmasri), [18] Transport for NSW conceded that "satisfaction of s 10A(2) is a jurisdictional precondition to the valid issue of a PAN". Although Beech-Jones J was not required to decide the point, he noted (at [16]) that the concession made by Transport for NSW appeared to be correct.
Section 10A was introduced into the Just Terms Act in 2016. In the Second Reading Speech for the Land Acquisition (Just Terms Compensation) Amendment Bill 2016 on 20 October 2016, the Minister for Roads, Maritime and Freight and Vice President of the Executive Council said (emphasis added): The first change is to require a fixed six-month negotiation period before compulsory acquisition can occur…That amendment will provide landowners with the necessary time to make decisions, understand the process and engage properly with the acquiring authority…. A fixed six-month negotiation period will provide much-needed certainty. It will allow people the time to understand their rights and obligations, take legal and valuation advice… [19]
On 10 May 2022, the first applicant executed the call option deed in favour of the second to sixth applicants. On 9 June 2022, the caveat was lodged on title, recording this interest of the option grantees. On 24 June 2022, Council sent a PAN addressed to each of the option grantees.
Council objected to the admissibility of the call option deed and associated call option documents, including the trustee resolution of Perry Properties as trustee for the Perry No 1 Trust, on the basis of that the call option deed was not a dutiable transaction pursuant to s 304 of the Duties Act 1997 (NSW). Upon the applicants' provision of further written submissions on this point, Council withdrew the objection and the documents were admitted into evidence.
The applicants submitted that in circumstances where Council was aware as early as 19 June 2022 that the option grantees had an interest in the property, they should have been afforded a six-month period of negotiation prior to the issuing to each of them of a PAN. They submitted that it is a jurisdictional precondition to acquisition that each and every owner is afforded the opportunity of a six-month negotiation period.
Such a construction of s 10A was submitted to be consistent with the approach set out by French CJ in R & R Fazzolari Pty Ltd v Parramatta City Council. [20] There his Honour said at [5] that in accordance with established principles of statutory interpretation, the preferable construction is that which authorises the least interference with private property rights, and that that requires a focus upon the purpose for which the Council proposed to acquire each of the parcels of land the subject of its notices. The applicants submitted that s 10A of the Just Terms Act should be strictly construed with the effect that the PANs given to the second to sixth applicants have no effect.
In characterising Ground 3 as a jurisdictional question, the applicants relied on the decisions in Desane and Elmasri. I do not consider either case to be authority for the proposition that compliance with s 10A is jurisdictional in the requisite sense. Rather, it seems to me that the obiter comments of Beech-Jones J in Elmasri at [16] were founded on a concession by Transport for New South Wales that satisfaction of s 10A was a "jurisdictional precondition" to the issuing of a PAN. Beech-Jones J held that it was not necessary to determine whether Transport's concession was well founded but, on the face of it, Transport's concession appeared correct. Beech-Jones J does not appear to have had the benefit of argument in relation to the operation of s 10A(7) (set out above at [19]), which provides that nothing in s 10A gives rise to, or can be taken into account in, any civil cause of action. Nor was there any analysis by the parties in Elmasri of the textual and contextual indications within the Just Terms Act as to whether failure to comply with the minimum period of negotiation for acquisition by agreement stipulated in s 10A should be taken to lead to the invalidity of a proposed acquisition notice.
In its written submissions, Council observed that while the second to sixth applicants claimed to have an interest in the property by reason of a caveat on title, their submissions did not indicate on what basis it is said that the interest arises. Council submitted that the mere placement of a caveat did not establish an interest in land. At the hearing, counsel for the applicants submitted that the second to sixth applicants held an "equitable interest in land". Mr Lancaster SC for Council submitted: We do not contend the call option holders do not have an interest in land within the meaning of the Act. But I would hesitate to make the submission that it is an equitable interest. Maybe in equity rather than equitable interest. But in any event, which one of those is an appropriate thing for a call option deed that is not to the point.
Further, Council submitted that the text of s 12(4) of the Just Terms Act contradicted the applicants' submission that the caveators are relevantly an "owner" for the purpose of the Just Term Act. If that were so, there would be no need for s 12(4) to specifically refer to caveators being given notice of a proposed acquisition, as distinct from "owners" being given notice under s 12(1).
Mr Lancaster SC relied on the decision of the Court of Appeal in Bligh Consulting v Ausgrid, [21] a case dealing with s 55(f) of the Just Terms Act as it then was. Basten JA's reasons for decision start at [2], in the course of which at [14] his Honour said: 14. As noted by Sackville AJA at [57] below, although "land" is defined to include "any interest in land", and "interest in land" is defined to mean "a legal or equitable estate or interest in the land, or an easement … over, or in connection with, the land", it does not follow that the term "land" is exclusively used as referring to interests in land. Indeed, the phrase "interest in land" uses the word "land" in a different, non-metaphysical, sense. That sense involves a reference to a physical part of the earth's surface; it may include areas permanently covered by water and it may include the space above and below the surface of the earth. In this sense, land is a physical object, not a legal concept.
And at [57], Sackville AJA (McColl JA agreeing) pointed to some of the conceptual difficulties if "land" is defined as including any interest in land when dealing with easements: 57. It is perhaps not self-evident that if a statutory authority compulsorily acquires an easement over land (and no other interest) owned by a person, that land (the servient tenement) adjoins or is severed from the "acquired land" for the purposes of s 55(f) of the Just Terms Act. It is true that "land" is defined to include an interest in land. Nonetheless, there may be an issue as to whether the servient tenement "adjoins" the easement appurtenant to the dominant tenement. However, the issue does not arise on this appeal because the parties conducted the proceedings in the L & E Court on the basis that s 55(f) of the Just Terms Act was capable of applying to Bligh Consulting's compensation claim and they approached the appeal on the same basis. Mr Lancaster SC adopted, by analogy, their Honours' observation that the word "land" need not be given on every occasion its defined meaning.
Mr Lancaster SC submitted, and I find, that Council satisfied the obligation in s 10A(2) of the Just Terms Act by making a genuine attempt to acquire the land by agreement with the first applicant, Perry Properties, the owner of the land, for at least six months before giving a proposed acquisition notice. I find that on a proper construction of s 10A, it could not be every owner of every "interest in land" within the meaning of the Just Terms Act that has to be negotiated with or with whom agreement is attempted to be reached before a proposed acquisition notice can be given. Rather, it is, as a matter of construction, the person, corporate or individual, who is in a position to sell the land, that is, the owner of the land.
Section 10A(2) is expressed in general terms, and does not identify any particular person to negotiate with, other than to require the authority of the State to make a genuine attempt to acquire the land by agreement. That the intention of s 10A(2) is that the person, corporate or individual, who is the owner of the land is to be negotiated with is consistent with the Second Reading Speech which refers to the amendment "provid[ing] landowners with the necessary time to make decisions, understand the process and engage properly with the acquiring authority" (emphasis added). On the applicants' case, the authority of the State would have to spend six months negotiating with the National Australia Bank, the third respondent, the mortgagee who has an undoubted equitable interest in the land.
Even if the applicants were able to establish non-compliance with s 10A, and that this was a matter required to be taken into account by the Court, I do not consider it to be a matter affecting the lawfulness of the issuing of the PANs. That is because the Just Terms Act foreshadows circumstances where not all interest holders are known at the time a PAN is given. That suggests that s 10A is not jurisdictional in nature. [22] For example, s 53 of the Just Terms Act addresses compensation for an interest not known to the acquiring authority. Section 67 provides for compensation claims by persons who have not been given a compensation notice (and presumably a proposed acquisition notice), and provides a mechanism by which an appeal to the Court may be brought against the rejection of the claim.
Moreover, applying orthodox principles of statutory construction, I find that the effect of the plain language of s 10A(7) is to preclude anything in s 10A giving rise to, or being able to be taken into account in, any civil cause of action. These are proceedings under s 674 of the LGA, and there can be no reasonable doubt that it is a civil cause of action. The same language as appears in s 10A(7) of the Just Terms Act is found in ss 3(2) and 10(3) of the Just Terms Act. Similar language appears in s 674A of the LGA. The effect of these provisions does not appear yet to have been judicially considered. Whilst I accept that s 10A is of importance in relation to pre-acquisition procedure, I find that a plain reading of the statutory language in s 10A precludes the outcome sought by the applicants in this case.
I dismiss Ground 3 of the further amended summons.

Discretion

Council accepted that if the Court finds against it in respect of any of the grounds, the scope of potential remedies available in the discretion of the Court could include the making of the declaration sought in Prayer 1 of the further amended summons, and an order restraining Council from publishing acquisition notices in reliance on the PANs. However, Council submitted that even if the Court determines that the PANs were unlawful on any of the bases contended for by the applicants, it would not automatically follow that a declaration should be made. [23]
In Great Lakes Council v Lani (Lani), [24] Preston CJ held that although the Court had jurisdiction to make declarations that the respondents had breached the planning or environmental statutes in question in that case, as a matter of discretion, declarations would not be appropriate in the circumstances. Such circumstances included whether a declaration would have any practical effect. [25]
Here, in the case of the second to sixth applicants, I am not satisfied, in the exercise of my discretion, that the making of a declaration would have any practical effect.
In all the circumstances, the applicants have not discharged their onus of establishing any of the grounds sought in the further amended summons.

Orders

The Court makes the following orders: 1. The further amended summons is dismissed. 2. The parties to file submissions, no longer than five pages in length, on the question of costs by Wednesday, 17 May 2023.

Endnotes

(1982) 41 ALR 467; (1982) 56 ALJR 678.
Samrein at 468-9 citing Thompson v Randwick Corporation (1950) 81 CLR 87 at 106; Minister for Public Works v Duggan (1951) 83 CLR 424; [1951] HCA 29.
(2018) 98 NSWLR 820; [2018] NSWCA 196 at [299]-[300].
Desane at [308], [310].
Telstra Corporation v Hurstville City Council (2002) 118 FCR 198; (2002) 189 ALR 737; [2002] FCA 385 at [50]; Webber v Racing New South Wales [2017] NSWSC 687 at [22].
Desane at [276], citing Sydney Municipal Council v Campbell [1925] AC 338 and Campbell v Municipal Council of Sydney (1923) 24 SR (NSW) 179.
Desane at [258].
Desane at [269].
Desane at [255], [275]-[276].
Desane at [268].
Samrein at 468-469.
(2002) 118 FCR 198; (2002) 189 ALR 737; [2002] FCA 385 (Sundberg and Finkelstein JJ).
[2017] NSWSC 687 (Beech-Jones J).
Telstra at [50].
(1997) 96 LGERA 157.
Gaffney v Camden Council (1997) 96 LGERA 157 at 161.
Barrett v Minister for Immigration, Local Government & Ethnic Affairs (1989) 18 ALD 129; [1989] FCA 388 (Pincus, Gummow and Lee JJ) at 132-133.
[2021] NSWSC 929 at [16].
New South Wales Legislative Council, Parliamentary Debates (Hansard), 20 October 2016 at 99.
(2009) 237 CLR 603 at 608; [2009] HCA 12 at [5].
[2017] NSWCA 95.
Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355; [1998] HCA 28 at [69]-[71] (McHugh, Gummow, Kirby and Hayne JJ).
Great Lakes Council v Lani (2007) 158 LGERA 1; [2007] NSWLEC 681 at [19] (Preston CJ) (Lani); Hill Top Residents Action Group Inc v Minister Administering the Sporting Venues Authorities Act 2008 (No 4) [2011] NSWLEC 6 at [12] (Pepper J).
Lani at [19].
Lani at [20]. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 11 May 2023

Metropolitan Water, Sewerage and Drainage Act 1924(NSW)

Land Acquisition (Just Terms Compensation) Act 1991(NSW)ss 3, 10, 10A, 12, 20, 53, 67, 360

Duties Act 1997(NSW)s 304

Liquor Act 2007(NSW)ss 4, 6(5), 40

Local Government Act 1993(NSW)ss 10A, 23, 24, 31, 45, 46, 186, 187, 188, 220, 674, 674A

Perry Properties Pty Limited v Georges River Council

At a glance

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Judgment (18 paragraphs)

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Legislation Cited (5)

Cases Cited (22)

Cited By (1)