APPLICANT FOR REVIEW : South Morang Pastoral Co Pty Ltd

MEDIUM NEUTRAL CITATION: [2002] VCAT 397

The land in Certificates of Title Volume 9866 Folio 680, Volume 9866 Folio 681, Volume 9852 Folio 022, Volume 9852 Folio 023, Volume 9852 Folio 024 and Volume 10020 Folio 765.

The parties are to advise the Registrar within 14 days of the date of this document as to whether they will arrange between themselves for the editing of the officer's report referred to in the reasons given below to delete references to legal advice in accordance with those reasons, or whether they wish me to edit the officer's report to delete such passages. In the event of the former course being adopted, the solicitors for the Council should indicate, at the same time, whether they wish the copy of the officer's report tendered at the hearing on the 8 March 2002 to be returned to them in its sealed envelope or destroyed without perusal.

Mr Stuart Morris QC, barrister, appeared on the instructions of the firm of Maddocks, solicitors for the Responsible Authority.

Mr Ian Pitt SC, appeared on the instructions of the firm of Minter Ellison, solicitors for the Applicant.

Application under s 40(1)(a)(i) of the Subdivision Act 1988 for a review of a refusal or failure of the Council to certify plans of subdivision proposed. The Applicant has sought certification under the Subdivision Act of plans of subdivision (PS 434850 E Version 02 Stages 1 and 2).

1. This proceeding is an application for review under s 40(1)(a)(i) of the Subdivision Act (SD Act) of the failure or refusal of the Council to certify two plans of subdivision being Stages 1 and 2 of Plan of Subdivision 434850 E. These stages are advanced for certification as parts of a plan of subdivision in relation to which Planning Permit 702085 was granted. That permit was issued on the 26 October 1994. It was for a substantial subdivision with a considerable number of lots. Endorsed plans in relation to the permit showed, amongst other things, a central open space area marked as "Reserved for municipal purposes". Upon registration of the plan or plans this area would, in accordance with the SD Act, vest in the Council. It would then be the responsibility of the Council as to what works should be carried out to make the area suitable for a public open space reserve. This would be expected to include landscaping. The Council would also be responsible for its future maintenance.

2. The Applicant is not now satisfied with that arrangement. It claims to be developing and promoting a high standard subdivision and it regards it as important in relation to the promotion and sale of the lots it is creating that this area should be landscaped and maintained at a high standard. It wants the area developed and maintained at a higher standard than, it believes, the Council is likely to achieve. To protect its investment it wishes to take over responsibility for the development and maintenance of this area. It is prepared to do this at its own costs.

3. In furtherance of its policy in this respect it has prepared plans for Stages 1 and 2 of the overall subdivision and submitted them for certification. It has shown the central open space area as common property or communal property. On that basis the relevant area would not vest in the Council on registration, but would remain communal property owned and managed by a body corporate under the subdivision. Pursuant to this arrangement the applicant is willing to bind itself to, what it considers to be, suitable agreements to carry out landscaping and maintenance which would otherwise fall to the Council.

4. The Council does not agree to this arrangement. It prefers that the notations in relation to the area on the plans to be certified should match those on the endorsed plans and that the land should ultimately vest in it in the normal course. This difference of view is the nub of the dispute brought to the Tribunal in this proceeding.

5. In forming its view in relation to the applications for certification giving rise to the current review proceedings, the Council considered a report prepared by an officer of the Council. This report was considered at a meeting which was not open to the public. Section 89(1) of the Local Government Act 1989 (LG Act) provides that a meeting of the Council or a special committee must be open to members of the public. However, sub-section (2) provides that such meeting can be closed to the public on the basis of a resolution of the Council or committee if the meeting is discussing, amongst other things, legal advice. The relevant meeting was closed because it was to consider legal advice.

6. This legal advice was partly given orally by Mr Morris to the officer of the Council with further advice, also given to the officer, by the firm of solicitors acting for the Council and instructing Mr Morris namely Maddocks, solicitors.

7. The officer's report considered at that meeting contained, I am told, material in relation to the application, its background and merits but also contained legal advice given by Maddocks and Mr Morris.

8. The Applicant wishes to be provided with a copy of that report including the legal advice. The Council objects to providing a copy of the report because it contains the legal advice to which, the Council claims, is privileged. It claims that the advice is subject to legal professional privilege so that it could not ordinarily be required to disclose the report, or at least those parts of it containing such advice.

9. The ordinary rule in relation to legal professional privilege is subject to an exception in relation to Tribunal proceedings. Section 80(1) of the Victorian Civil and Administrative Tribunal Act 1998 (VCAT Act) provides that the Tribunal may give directions at any time in a proceeding and do whatever is necessary for the expeditious and fair hearing and determination of a proceeding. This power to give directions is exercisable by any member.

Sub-section (3) of s 80 goes on to provide that the Tribunal may give directions under the section requiring a party to produce a document or provide information in a proceeding for review of a decision despite anything to the contrary in s 106(1) or any rule of law relating to privilege or the public interest in relation to the production of documents.

10. Section 106(1) VCAT Act provides that a person is excused from answering a question or producing a document in a proceeding if the person could not be compelled to answer the question or produce the document in proceedings in the Supreme Court. However that is subject to the specific exception in s 80(3).

11. I think that the specific statutory provision of s 80(3) makes it clear that I have the power to require production of the officer's report in spite of the claim of privilege raised in relation to it.

12. I have the power, but that does not mean that I need exercise it. Section 80(3) provides that the Tribunal "may" give directions for production of the document. In the exercise of the discretion thereby provided I may decide not to require production. I may decide, on balance, that it is not necessary or appropriate to do so. In terms of s 80(1), I may decide that such production is not necessary for the expeditious or fair hearing or determination of the proceeding. In coming to such a conclusion I may take the view that legal professional privilege represents a sound and important principal in relation to the administration of justice and the conduct of litigation. It is based on sound public policy that should only be overruled (pursuant to s 80(3)) where there are strong and compelling reasons for doing so. There may well be circumstances where on balance, and in the ultimate interests of justice, it would be appropriate to take such a course. I recognise that there is an advantage, not just to parties to litigation, but to the conduct of litigation generally, that parties should be able to have access to legal advice on a basis that the advice is privileged and can be kept confidential unless the client chooses to waive the privilege.

13. This case arises under the Subdivision Act. As such Practice Note Planning List 2 does not apply to it. That Practice Note specifies various items of information and documents which the decision maker is called upon to provide to the Tribunal in relation to various sorts of reviews under the Planning and Environment Act 1987. The requirements for different sorts of reviews under that Act vary in accordance with their various requirements. Amongst the things required to be provided is commonly an officer's report being the equivalent of the officer's report in this case. Notwithstanding that Practice Note, I do not doubt that the Tribunal could waive that requirement in a particular case if it thought, for some good reason, that such waiver should be granted.

14. I note that where such a report is provided to the Tribunal, parties and members of the public can gain access to it. It would, in my view, be inappropriate for the Tribunal to have regard to the contents of such a report without the parties knowing of that circumstance and having an opportunity to likewise become aware of its contents. I think that is true in relation to a report provided to the Tribunal pursuant to Practice Note Planning 2 and, ordinarily at least, also in relation to a report produced pursuant to s 80(3) VCAT Act where the Council has objected to such production.

15. It has not always, and in all circumstances, been the practice of the current Planning Tribunal (namely the Planning and Environment List of VCAT) and its predecessor planning tribunals, to require production of officers' reports. When Mr Phillip Opas was Chief Chairman of the Planning Appeals Board he used to refuse to receive or look at such reports when attempts were made to tender them. A different view was adopted during the life of the planning division of the Administrative Appeals Tribunal (AAT) as the planning tribunal. That was the planning tribunal chronologically between the Planning Appeals Board and the 1 July 1998 when VCAT took up this responsibility. I, as a member of the AAT, and subsequently as a member of this Tribunal, have taken the view that it is appropriate to receive and consider such officers' reports. There is considerable authority for the view that planning appeals to the AAT and planning reviews before VCAT are re-hearings of the application to the Responsible Authority. Although the Tribunal normally has considerably more information, evidence and submissions then were available to the Responsible Authority, it nevertheless seems to me appropriate that the Tribunal should have available to it the information, evidence and material that the Responsible Authority had. That is the current view and thus the requirement for the lodging of such reports as specified in Practice Note Planning No. 1.

16. I do not mean by this that I necessarily regard it as imperative that the officer's report or all of it, would have to be disclosed in every case. This is the first case in which I have encountered objection to such production, but I have never, in my own mind, excluded the possibility that there could be good reason, in some circumstances, to decline to receive an officer's report, or to decline to receive parts of such a report. I certainly do not think that it is impossible for the Tribunal to fairly and appropriately determine review proceedings without having access to such a report or to every part of such a report.

17. I think the situation in relation to this SD Act review, and the officer's report sought in this case, is generally parallel to the situation in relation to a PE Act review and to an officer's report in relation to a planning application.

18. In this case I am aware the conclusion tendered to the Council because Mr Morris told me. He said that the thrust of the advice was to the effect that the Council should not certify the plans that show the space as communal open space. He added that nothing in the advice would support a conclusion that it was appropriate to show the area as communal open space.

19. However, apart from this conclusion, the advice discusses possible ways to resolve the differences that have arisen between the Council and the Applicant. It is contended that it would be prejudicial and embarrassing for the Council to have this confidential discussion of options disclosed to what has become an opposing party. I can recognise some weight in this point, although I have not found it necessary to assess or rely upon allegations that access is sought for the purpose of embarrassing the Council in relation to possible future litigation or because disclosure might prevent the Council from engaging its preferred barrister.

20. There was another contention that the advice sought to be kept confidential was not really legal advice that could be the subject of legal professional privilege because it is not confined to the interpretation and application of the relevant statutory provisions. There was debate about whether advice that extends to questions of strategy and possible methods by which the dispute might be compromised or legal mechanisms that might be used to achieve a certain outcome. Mr Pitt submitted that legal professional privilege is narrowed to advice on specific legal issues. Mr Morris regards this as rather surprising and contends that there is a lot of advice as to tactics and strategy and the like which has, up to now, been regarded as subject of legal professional privilege.

21. I do not think it is necessary for me, for the purposes of this case, to finally decide this dispute as to the width of advice that is to be regarded as legal advice for the purposes of legal professional privilege. However, like Mr Morris, I would be surprised indeed if the concept did not extend to questions of tactics and strategy, weaknesses in the client's position, options as to courses that might be followed and questions in relation to possible compromise including negotiating and ultimate positions. It seems to me that a large part of the benefit of legal professional privilege, not just to the parties concerned, but in relation to the administration of justice generally, would be lost if the narrow view was adopted. The advantage of parties being able to obtain full and frank advice in relation to the strengths and weaknesses of their positions would be lost, and the opportunities for negotiations and settlement would be compromised, if such confidential matters had to be disclosed.

22. Mr Pitt submitted that the full officer's report ought to be required because it would give the Tribunal a better understanding of the context in which the Council made its decision and would enable a better understanding of the grounds of refusal.

23. I do not think that access to the legal advice is necessary for this purpose. I believe that the parties, through their submissions and evidence, can provide information of the context, so far as is relevant, in which the Council made its decision. It should be remembered that the review is a rehearing. The Tribunal will make its decision on the basis of the evidence and submissions put before it. Indeed, the context in which it makes its decision will be different, and probably considerably better informed, than the one in which the Council made its decision. In general terms, it does not strike me that a better understanding of the context in which the Council made its decision is important to the Tribunal. As for understanding the grounds of refusal, the Council will have an opportunity of advancing its case to substantiate its grounds of refusal. I do not see that disclosure of the advice sought is necessary for a proper consideration of the case by the Tribunal. If I were hearing the case, I would not be starting from some presumption in favour of the decision made by the Council. I think the Tribunal should make up its mind on the basis of the case before it.

24. Mr Pitt says that there is a mandatory duty on the Council to certify the plans of subdivision if certain things are satisfied. If that is correct, then it will be a question before the Tribunal as to whether those things are satisfied. If questions of law are involved they can be debated before the Tribunal and, if necessary, ultimately decided by the Tribunal on the basis of the evidence and arguments put.

25. It follows that, at any rate in relation to the legal advice, I do not agree with Mr Pitt when he said "we say that the document would help the Tribunal decide whether or not the plans should be certified".

26. Mr Pitt also said "other than the officer's report we have no way of knowing what the Council decided". As to that, it is known that the Council decided not to certify the plans unless and until the notation in relation to the area concerned is changed to read "reserved for municipal purposes" in accordance with the endorsed plans in relation to the permit. That is what it decided. If it has other grounds it should disclose them in writing as soon as possible. In the meantime it would be for the Tribunal to decide whether the reason is a good one and whether the decision of the Council should be upheld or overturned or varied. It should do so on the merits after hearing the parties.

27. It was also said on behalf of the Applicant "we say this is a device to prevent open and transparent decision making on review". It certainly does not prevent open and transparent decision making on review by the Tribunal. I do not think that the objection of the legal advice obscures its decision making in any way that is detrimental to the making of a proper decision by the Tribunal. As to the balance of the report, I see no reason why it should not be disclosed.

28. I think that it is appropriate that the officer's report should be made available to the Tribunal and to the Applicant, except for the passages containing legal advice. In relation to the discussion of the wider and narrower concepts of legal advice referred to above, I mean legal advice in the broader sense.

29. At the hearing I was given a full copy of the officer's report in case I came to such a view. I have not looked at, or read, this document either in the course of the hearing or afterwards. Immediately after the hearing I sealed it in an envelope which I marked "Confidential" and I have retained the sealed envelope in my possession ever since. I now propose that a copy of the report should be attached to the Tribunal file and provided to the Applicant which has had the passages containing legal advice obliterated. If the parties agree, I am happy for this to be arranged between the parties. Otherwise, I am happy to open the sealed envelope, read the report and strike out the passages that I think should be obliterated on the basis that thereafter I will disqualify myself in relation to the future conduct of this case. I will give a direction that the parties indicate to the Registrar in writing within 14 days of the date of this document as to whether they wish me to edit the officer's report in this way. If that is not sought I would wish the representatives of the Council to indicate whether they wish the sealed envelope and its contents to be returned to them or simply destroyed without being looked at.

30. Delivery of this document with its direction and reasons has been delayed because of the decision of the Supreme Court in the case of the Warehouse Group (Australia) Pty Ltd v Bevendale Pty Ltd, Whittlesea Council, ISPT Pty Ltd and Attorney-General for the State of Victoria [2002] VSC 108 having regard to the circumstances that I conducted the hearing sitting alone and that my knowledge and experience, according to that decision, do not qualify me to sit alone. It is now published, that decision having been reversed by the Court of Appeal.