Solicitors:
McPhee Kelshaw (First and Second Plaintiffs)
HWL Ebsworth (Defendant)
File Number(s): 2017/83357
[2]
Introduction
HER HONOUR: These judicial review proceedings arise out of a Proposed Acquisition Notice ("PAN") dated 6 December 2016, issued by the defendant, Georges River Council, concerning the Council's proposed compulsory acquisition of church property known as 4-6 Dora Street, Hurstville ("the Land"). The PAN was issued pursuant to the provisions of the Land Acquisition (Just Terms Compensation) Act 1991 ("the Just Terms Act") and the Local Government Act 1993. The plaintiffs alleged that the PAN is void for jurisdictional error because first, it purports to notify intention to acquire interest in the land which is not "held" by the recipient of the PAN; and second, fails to comply with the requirements of ss 11 and 12 of the Just Terms Act, in failing to notify any "owners" with an interest in the land.
By Further Amended Summons filed on 27 March 2017, the plaintiffs seek various orders in the nature of declarations, certiorari, restraint and prohibition. The first plaintiff, the Baptist Church Union ("the Union") is the registered proprietor of the land. The second plaintiff, the Baptist Churches Property Trust ("the Trust") claims that it is the owner of the land by virtue of s 16 of the Baptist Churches of NSW Property Trust Act 1984 ("the Property Trust Act") and complains that it did not receive a PAN.
The plaintiffs seek this relief on an urgent basis given that the defendant Council has a window period of 30 days, beginning 90 days after 6 December 2016 to proceed with acquisition or there is a deemed withdrawal of the PAN. The 30 day window expires on or about 5 April 2017.
The defendant submits that due to the operation of Uniform Civil Procedure Rule 59.10, the plaintiffs are out of time to seek relief in relation to the PAN, and that leave to bring the claim out of time ought not be given because first, the case does not enjoy reasonable prospects of success; and second, there has been no satisfactory explanation for the delay in commencing the proceedings.
The defendant disputes the plaintiffs' contention that the PAN was not valid and contends that the plaintiffs' claim is misconceived because it elevates procedural requirements of the Just Terms Act into mandatory pre-conditions to be satisfied before acquisition can occur, and that is not consistent with the legislative scheme or terms of the Act. The defendant argues that the objects and structure of the legislation is focused upon procedures to simplify and expedite the compulsory acquisition processes and to ensure avenues of compensation are available for those able to receive compensation (including after acquisition has taken place).
The defendant seeks orders that the Further Amended Summons be dismissed with costs.
[3]
Statutory Context
Section 186 of the Local Government Act provides, inter alia:
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.
The mechanism by which a council can acquire land is set out in s 187 of that Act:
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.
The Just Terms Act provides certain definitions relevant to the Notice procedures at s 4(1):
interest in land means:
(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 land.
…
owner of land means any person who has an interest in the land.
…
registered interest in land means an interest in the land:
(a) recorded in the Register kept under the Real Property Act 1900, or
(b) recorded in the General Register of Deeds kept under the Conveyancing Act 1919, or
(c) recorded in the National Native Title Register kept under the Commonwealth Native Title Act if the interest is an interest in relation to land that is the subject of an approved determination of native title (other than an approved determination that no native title exists).
The Just Terms Act Part 2 is entitled "Acquisition of Land by Compulsory Process", Division 1 is titled "Pre-acquisition procedures", and provides, inter alia:
11 Notice of intention to acquire land by compulsory process
(1) An authority of the State may not acquire land by compulsory process unless an authority has given the owners of the land written notice of its intention to do so.
(2) The authority of the State is not prevented from acquiring the land by agreement after giving the proposed acquisition notice.
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.
…
13 Minimum period of notice
(1) A proposed acquisition notice must be given at least 90 days before the land is compulsorily acquired.
(2) A shorter period of notice may be given if:
(a) the authority of the State and the owners of the land agree in writing to the shorter period, or
(b) the Minister responsible for that authority approves of the shorter period, but only if that Minister is satisfied that the urgency of the matter or other circumstances of the case make it impracticable to give any longer period of notice.
(3) The approval of a shorter period of notice under subsection (2)(b) requires the concurrence of the Minister administering this Act (being a concurrence given for the particular approval or given general for an approval of that kind).
14 Compulsory acquisition to be completed as soon as practicable
(1) As soon as practicable after the expiration of the minimum period of notice of a proposed compulsory acquisition, the authority of the State must:
(a) acquire the land by compulsory process or by agreement, or
(b) withdraw the proposed acquisition notice.
(2) The proposed acquisition notice is taken to have been withdrawn if the authority of the State has not acquired the land or withdrawn the proposed acquisition notice:
(a) except as provided by paragraph (b) - within 120 days after it gave that notice, or
(b) within such longer period as that authority and the owner of the land have agreed to in writing.
(3) If the proposed acquisition notice is withdrawn or taken to have been withdrawn, the authority of the State may not give a further proposed acquisition notice in respect of the land within 12 months after the date of withdrawal unless the Minister responsible for that authority is satisfied that in the circumstances of the case a further notice within that period is justified.
15 Particulars to be included in proposed acquisition notice
A proposed acquisition notice given to an owner of land must:
(a) be in the form prescribed by the regulations or (if no such form is prescribed) in the form approved by the Minister, and
(b) specify the authority of the State proposing to acquire the land, and
(c) contain a description sufficient to identify the land proposed to be acquired, and
(d) specify the period within which the land will be compulsorily acquired, and
(e) request any owner who wishes to claim compensation for the acquisition to lodge with the authority of the State a claim for compensation within the period specified in the notice (being not less than 60 days after the notice is given to the owner), and
(f) be accompanied by the form for a claim for compensation under section 39.
16 Withdrawal or amendment of proposed acquisition notice
…
(3) An authority of the State may, by a further notice, amend a proposed acquisition notice for the purpose of correcting a clerical error or an obvious mistake in the notice. Any such amendment has effect from the date of the original notice unless otherwise specified in the further notice.
…
Division 4 of Part 2 of the Just Terms Act is titled "Miscellaneous provisions relating to acquisition" and provides, inter alia:
33 Validity of compulsory acquisition
Once land has been acquired by compulsory process under this Act, the validity of the acquisition is not affected by:
(a) a failure to comply with any requirement of this Part relating to the giving of notice of the proposed acquisition, or
(b) a subsequent failure to comply with a requirement of this Act relating to the acquisition.
34 Former owner's right to occupy land until compensation paid etc
(1) A person who was in lawful occupation of land immediately before it was compulsorily acquired under this Act and to whom compensation is payable under this Act is entitled to remain in occupation until:
(a) the compensation is duly paid to the person, or
(b) the authority of the State makes (in accordance with any other provision of this Act) an advance payment of not less than 90 per cent of the amount of compensation offered by the authority, or
(c) the authority of the State makes (in accordance with any other provision of this Act) a payment into the trust account kept under Part 3 of not less than 90 per cent of the amount of compensation offered by the authority,
whichever first occurs.
(2) Any such person is entitled to remain in occupation of any building that is the person's principal place of residence, or the person's place of business, for 3 months after it is compulsorily acquired, even though the person has ceased to be entitled to remain in occupation under subsection (1). However, if the Minister responsible for the authority of the State is satisfied that the authority requires immediate vacant possession of land, the authority is entitled to immediate vacant possession even though the 3-month period has not expired.
…
The Just Terms Act Part 3 ("Compensation for acquisition of land"), Division 1 ("Entitlement to compensation") and Division 2 ("Claims for compensation") provide, inter alia:
37 Right to compensation if land compulsorily acquired
An owner of an interest in land which is divested, extinguished or diminished by an acquisition notice is entitled to be paid compensation in accordance with this Part by the authority of the State which acquired the land.
39 Claim for compensation
(1) A person who wishes to claim compensation under this Part must lodge a claim in accordance with this section with the authority of the State that is acquiring the land concerned or with the Valuer-General.
(2) A claim for compensation must be in the form prescribed by the regulations or (if no such form is prescribed) in the form approved by the Minister.
(3) The claim form may require information to be verified by statutory declaration.
(4) A claim for compensation may be withdrawn by the claimant.
(5) As soon as practicable after an authority of the State or the Valuer-General receives a claim for compensation:
(a) the authority must give the Valuer-General a copy of the claim, or
(b) the Valuer-General must give the authority a copy of the claim,
as the case requires.
40 Owner claiming compensation must disclose particulars of other persons with an interest in land
(1) A person who claims compensation under this Part must state, in the claim form, whether the person is aware of any other person who has an interest in the land and who may be entitled to compensation.
(2) If the person is aware of such an interest, the claim must contain such particulars of the interest as are required by the requisite claim form.
Division 3 of Part 2 ("Post-acquisition procedures relating to compensation") provides, inter alia:
42 Notice of compensation entitlement and offer of compensation
(1) An authority of the State which has compulsorily acquired land under this Act must, within 45 days after the publication of the acquisition notice, give the former owners of the land written notice of the compulsory acquisition, their entitlement to compensation and the amount of compensation offered (as determined by the Valuer-General).
(2) The compensation notice must be given to all former owners of the land who, immediately before the acquisition:
(a) had a registered interest in the land, or
(b) were in lawful occupation of the land (but only if the authority of the State considers they are entitled to compensation), or
(c) had, to the actual knowledge of the authority of the State, an interest in the land which entitles them to compensation.
…
46 Claim for compensation by person not offered compensation
(1) A person who has not been given a compensation notice may nevertheless lodge with an authority of the State a claim for compensation under this Part.
(2) If the authority of the State considers that the person is entitled to compensation, the authority is to give the person a compensation notice. Otherwise, the authority is to reject the claim by notice in writing given to the person.
(3) A claim for compensation under this section is taken to have been rejected if the authority of the State has not dealt with the claim within 60 days after receiving the claim. However, the authority of the State is not precluded from giving the person a compensation notice after that time.
53 Compensation for interest not known to acquiring authority
(1) If an authority of the State pays compensation under this Act to a former owner of land without regard to the existence of an interest in the land owned by another person (being an interest that was not known to the authority when that compensation was paid):
(a) that other person's entitlement to be paid compensation by the authority in respect of the acquisition of that land is extinguished, and
(b his or her rights and entitlements against the former owner in respect of the interest are not affected by the divesting, extinguishing or diminution of the interest by this Act.
(2) For the purposes of this section, an interest is known to an authority of the State only if it is a registered interest or an interest within the actual knowledge of the authority.
Division 4 of Part 2 ("Determination of amount of compensation") provides, inter alia:
55 Relevant matters to be considered in determining amount of compensation
In determining the amount of compensation to which a person is entitled, regard must be had to the following matters only (as assessed in accordance with this Division):
(a) the market value of the land on the date of its acquisition,
(b) any special value of the land to the person on the date of its acquisition,
(c) any loss attributable to severance,
(d) any loss attributable to disturbance,
(e) the disadvantage resulting from relocation,
(f) any increase or decrease in the value of any other land of the person at the date of acquisition which adjoins or is severed from the acquired land by reason of the carrying out of, or the proposal to carry out, the public purpose for which the land was acquired.
56 Market value
(1) In this Act:
market value of land at any time means the amount that would have been paid for the land if it had been sold at that time by a willing but not anxious seller to a willing but not anxious buyer, disregarding (for the purpose of determining the amount that would have been paid):
(a) any increase or decrease in the value of the land caused by the carrying out of, or the proposal to carry out, the public purpose for which the land was acquired, and
(b) any increase in the value of the land caused by the carrying out by the authority of the State, before the land is acquired, of improvements for the public purpose for which the land is to be acquired, and
(c) any increase in the value of the land caused by its use in a manner or for a purpose contrary to law.
(2) When assessing the market value of land for the purpose of paying compensation to a number of former owners of the land, the sum of the market values of each interest in the land must not (except with the approval of the Minister responsible for the authority of the State) exceed the market value of the land at the date of acquisition.
(3) If:
(a) the land is used for a particular purpose and there is no general market for land used for that purpose, and
(b) the owner genuinely proposes to continue after the acquisition to use other land for that purpose,
the market value of the land is taken, for the purpose of paying compensation, to be the reasonable cost to the owner of equivalent reinstatement in some other location. That cost is to be reduced by any costs for which compensation is payable for loss attributable to disturbance and by any likely improvement in the owner's financial position because of the relocation.
57 Special value
In this Act:
special value of land means the financial value of any advantage, in addition to market value, to the person entitled to compensation which is incidental to the person's use of the land.
[4]
Evidence relied on by the plaintiffs
The plaintiffs tendered five affidavits. An affidavit sworn 17 March 2017 by Stephen Bartlett described as "Director of Ministries" and an employee of the first plaintiff deposed to some details of the history of the Union and the Trust and that they are separate legal entities. It annexed the PAN and accompanying s 39 "Claim for Compensation Form" and the covering letter serving the Notice and identifying "Claire Stuckey" as the person at the Council to contact if they "had any queries" and providing her phone number.
There were two affidavits from Mr Grae McWhirter dated 17 March 2017 and 21 March 2017 respectively. Mr McWhirter is described a Senior Minister in the Baptist Church. He deposed to historical matters regarding the function and processes of the Baptist Church, its historical arrangements regarding Trusts and associated entities, and annexed correspondence between the "Blakehurst & Hurstville Baptist Churches" and the former iteration of the defendant Council showing negotiations regarding the land between the Baptist Church and the then Hurstville City Council dating back as far as July 2008.
The plaintiffs also relied upon two affidavits of Trevor Cork, Solicitor, dated 17 March 2017 and 23 March 2017. The affidavit of 17 March 2017 deposed to various matters it was asserted were present on the Baptist Church's website which was argued on behalf of the plaintiffs indicated sufficient information to put the defendant on notice that there were "complexities" associated with the ownership of the property at 4-6 Dora Street, Hurstville (the land) and further that those complexities related to trust arrangements. Counsel for the plaintiffs submitted that this material showed that there had been a divesting of ownership of the land to a statutorily constituted trust and that the registered proprietor, the Baptist Union of New South Wales, no longer held any legal or equitable interest in the land.
The second affidavit of Mr Cork dated 23 March 2017 dealt with action by the plaintiffs once the notice was received in December 2016.
Also tendered was a letter by the solicitor for the defendant, Mr Olliver of HWL Ebsworth, in which the defendant confirmed that the enquiries it relied upon were directed to the Registrar General as well as communications between the Council and Hurstville Baptist Church. (It was confirmed by counsel for the plaintiffs during argument that at no time had the existence of the Trust or its "ownership" role been raised directly with any of the defendant's staff or mentioned in correspondence with the defendant or its predecessors).
The plaintiffs also tendered agreed transcripts of the words on the signs situated at the front of the church buildings on the land and photographs of the signs and their position on the land, which made reference to the "Connect Church".
[5]
Evidence relied upon by the defendant
The defendant relied upon an affidavit of Brian Olliver, solicitor dated 23 March 2017. That affidavit dealt with the Ministerial approval for compulsory acquisition and the ongoing negotiation between the defendant and the Baptist Church regarding the land.
[6]
Preliminary Issue: UCPR Rule 59.10
The defendant submitted that pursuant to Rule 59.10 of the Uniform Civil Procedure Rules, the plaintiff was out of time to commence the proceedings. Rule 59.10 provides:
59.10 Time for commencing proceedings
(1) Proceedings for judicial review of a decision must be commenced within 3 months of the date of the decision.
(2) The court may, at any time, extend the time for commencing proceedings fixed by subrule (1).
(3) In considering whether to extend time under subrule (2), the court should take account of such factors as are relevant in the circumstances of the particular case, including the following:
(a) any particular interest of the plaintiff in challenging the decision,
(b) possible prejudice to other persons caused by the passage of time, if the relief were to be granted, including but not limited to prejudice to parties to the proceedings,
(c) the time at which the plaintiff became or, by exercising reasonable diligence, should have become aware of the decision,
(d) any relevant public interest.
…
The defendant submitted that there were two bases why leave should not be given. First it was argued the plaintiffs' case does not enjoy reasonable prospects of success. Second it is said that there was no satisfactory explanation of the delay in commencing the proceedings particularly given that the plaintiffs assert that the defects in the PAN were "fundamental and obvious".
In oral submissions, counsel for the defendant elaborated upon the practical difficulties created by the plaintiffs' delays, given the consequence for the defendant of non-gazettal within the 120 day period after the PAN as set out in s 14(2) and (3).
In response, the plaintiffs argued that the delay was explained in a lengthy letter from Mr McWhirter addressed to the Council (p 38 of the Olliver affidavit) and at p 56 of that affidavit in the letter of advice of the plaintiff's solicitor, Mr Cork, dated 10 February 2017. This material referred to the long term negotiations between the parties. It was argued that the PAN was served "just before" Christmas and that the counsel the plaintiffs wished to consult was on leave until the end of January. It was argued that the delay was only 8 days (taking into account service on 9 December) and did not cause any prejudice to the defendant.
[7]
Resolution regarding extension of time for commencing proceedings
I have determined that it is appropriate to extend time for commencing proceedings in the circumstances. It is preferable, in the interests of justice, to determine issues on their merits. Whilst the delay has caused urgency and some tensions in dealing with the proposed orders, counsel for the defendant candidly outlined urgent gazettal processes that could be invoked if necessary to still comply with the statutory timelines and in those circumstances, any potential prejudice to the defendant can be managed provided this Court delivers its judgment on an urgent basis and before 5 April 2017.
[8]
The plaintiffs' submissions regarding the relief sought
The plaintiffs sought the following relief:
1 [A] declaration that the Proposed Acquisition Notice (PAN) dated 6 December 2016 purportedly issued in relation to the land known as 4-6 Dora St, Hurstville is invalid and of no force or effect.
1A A declaration that the purported Amended PAN dated 22 March 2017 is not a valid amending PAN pursuant to s16 of the Land Acquisition (Just Terms Compensation) Act 1991.
2 An order in the nature of certiorari pursuant to s69 of the Supreme Court Act 1970 quashing the PAN purportedly issued by the defendant on 6 December 2016.
2A An order in the nature of certiorari pursuant to s69 of the Supreme Court Act 1970 quashing the amending PAN purportedly issued by the Defendant on 22 March 2017.
3 In the alternative to Order 1, a declaration that the First Plaintiff has no interest in the land known as 4-6 Dora St, Hurstville within the meaning of that term in the Land Acquisition (Just Terms Compensation) Act 1991.
4 In the alternative to Order 1 and 1A, a declaration that even if valid for some purposes, the PAN and the amending PAN [do] not and [do] not purport to acquire the Second Plaintiff's, the Trust's, interest in the land known as 4-6 Dora St, Hurstville.
5 In the alternative to Order 1 and 1A, a declaration that even if valid for some purposes, the PAN does not purport to acquire the interest of any congregation, within the meaning of the Baptist Churches of New South Wales Property Trust Act 1984, in the land known as 4-6 Dora St, Hurstville.
6 An order restraining any action by the defendant in reliance on the PAN and the amending PAN.
7 An order in the nature of prohibition pursuant to s69 of the Supreme Court Act 1970 restraining the publication or gazettal of any Acquisition Notice within the meaning of s19 of the Land Acquisition (Just Terms Compensation) Act 1991 by or on behalf of the Defendant purporting to acquire the land known as 4-6 Dora Street, Hurstville in reliance on the PAN or the amending PAN, or any interest in it.
8 Interlocutory relief in the nature of orders 6 and 7 above.
9 Costs.
In its written submissions filed on 17 March 2017, the plaintiffs submit that s 10 of the Just Terms Act requires service on all owners of the land that have a registered interest, are in lawful occupation or have, to the actual knowledge of the Council, an interest in the land. They argue that the PAN was not served on any "actual" owner because by virtue of the provisions of s 16 of the Property Trust Act all legal and beneficial ownership of the land was vested in the second plaintiff. The second plaintiff was not served with a PAN.
The plaintiffs argue that the first plaintiff, although recorded on the Register at the Registrar General's Office as the registered proprietor of the land in fact had no interest in the land and so could not be considered to be an owner with a registered interest within the meaning of the Just Terms Act. It was submitted that the defendant should be deemed to have actual knowledge of the Trust ownership of the land because diligent enquiry could have ascertained the Trust's interest in the land. In support of this submission, the plaintiffs relied on Crane v Waverley Council [2012] NSWLEC 142.
The plaintiffs argued that s 33 of the Just Terms Act is in the nature of a privative clause protecting the final decision after a defined period; and that s 33 cannot be used to argue protection from jurisdictional error. Proper construction of s 33 is that it only applies to the situation of an already gazetted acquisition notice where there has been non-jurisdictional error. Kirk v Industrial Relations Commission of New South Wales (2010) 239 CLR 531; 2010 HCA 1 at [96] - [100] was cited in support of this submission.
The fourth argument articulated by the plaintiffs is that a breach of a statutory requirement that is jurisdictional generally results in invalidity, citing Minister for Immigration and Multicultural Affairs v Bhardwaj (2002) 209 CLR 597 at [51], [61] (Gaudron and Gummow JJ), [153] (Hayne J), [67] (McHugh J).
The fifth argument made was that the notification requirements are preconditions to the exercise of the statutory power to compulsorily acquire the land under the Act and such requirements are jurisdictional in nature and should be seen as jurisdictional preconditions: Timbarra Protection Coalition Inc v Rose Mining NL (1999) 46 NSWLR 55; [1999] NSWCA 8.
The sixth argument made was that breach of notification requirements in particular generally lead to invalidity, citing a series of authorities: SS Constructions Pty Ltd v Ventura Motors Pty Ltd [1964] VicRp 32; VR 229 at 245-246; (1963) 10 LGRA 210 at 230-231; Scurr v Brisbane City Council (1973) 133 CLR 242 at 255-256; [1973] HCA 39; Pioneer Concrete (Qld) Pty Ltd v Brisbane City Council (1980) 145 CLR 485 at 518; [1980] HCA 1.
The seventh argument made was that the PAN did not comply with s 15(a) of the Act because it did not "contain the details required by the regulations, is not in the form required by the regulations, is unsigned by any person". During argument I was informed that there were no specific regulations but that the Minister's "prescribed notice" was the issue, and the PAN provided to the first plaintiff was not signed.
The absence of signature criticism arises from the prescribed form which bears a signature bar on the bottom of the second page. This is described in the plaintiffs' written submissions (at par 19) as a "jurisdictional precondition to validity" and the absence of signature is a "procedural [precondition] to the exercise of a power" and thus a "species of jurisdictional error". In reliance on that submission, counsel for the plaintiff cited Craig v South Australia (1994) 184 CLR 163 at 177.
An Amended PAN was served by the defendant upon the first plaintiff dated 22 March 2017 bearing a signature. The defendant argued pursuant to s 16 of the Just Terms Act, this Amended PAN can be considered to be effective from the date of the initial PAN and that the absence of signature was at the most, a "clerical error" and correctable by s 16(3).
Counsel for the plaintiffs was not prepared to accept that the failure to sign the document was a clerical error that was able to be corrected by s 16(3) of the Just Terms Act, nor was he prepared to accept that identification of the contact at the defendant Council with a direct phone number notified in the covering letter serving the initial PAN was sufficient to remedy the invalidity raised by the absence of the signature on the PAN.
The eighth substantive submission made on behalf of the plaintiffs related to the form of orders sought. They argued that an injunctive order was appropriate as the plaintiffs had demonstrated a serious question to be tried, namely irreparable injury for which damages would not compensate the plaintiffs being the deprivation of the land (noting a parcel of land is regarded as unique at law), and that the balance of convenience favours the interlocutory relief. They submitted that, at the very least, there was a serious question to be tried in relation to the propositions set out in the submissions. Damages would not be a sufficient remedy for the plaintiffs in the event that an interlocutory injunction is not granted because the unique Church lot - (the Land) - would be lost "for all time".
The last submissions underpin the misguided nature of the plaintiffs' application to this Court and their misplaced approach to the Just Terms Act and its objects, statutory scheme and operation. Compulsory acquisition pursuant to the Local Government Act was already decided. Pursuant to the objects of the Just Terms Act, the terms of the acquisition had been and was continuing to be negotiated. The Just Terms Act and the associated machinery (including the PAN) provides procedures to ensure appropriate compensation could be provided and pursued in a simplified and expedited process.
The plaintiffs' oral submissions expanded on the "due inquiry/actual knowledge" point. It was argued by counsel for the plaintiff that the decision of Biscoe J in Crane had a role in identifying what should have comprised due inquiry by the defendant in the circumstances. It was argued that Crane was authority for the proposition that the defendant had an obligation to at least look at the Baptist Church's website, and to interrogate that website to discover information regarding the Trust.
It was submitted that there should have been an enquiry of any legal entity owning the land because the definition of "owner" of "an interest" under s 4 of the Just Terms Act was very wide and the defendant was on notice of the need to actually take steps to find out who may be affected by the acquisition.
It was submitted that it is a matter of fact and degree as to what this "due inquiry" should have entailed, but the failure to find out certain things such as the occupation of the premises by Connect Church and the "ownership of the Land by the Trust" led to an available inference that the defendant had actual knowledge of matters relating to the Church and its occupier the Connect Church. It was argued that due inquiry should have entailed at least interrogation of the Baptist Church's website, and to have observed the notices outside the Church showed that Connect Church had occupation or a physical presence on the land.
[9]
Submissions of the Defendant
The defendant argued that the plaintiffs' claims are misconceived because they elevate procedural requirements of the Just Terms Act into mandatory preconditions to be satisfied before any acquisition can occur. This is not consistent with the scheme or terms of the Act. During oral submissions, my attention was drawn to s 3 of the Act - "Objects of Act". It was argued that the objects of the Act made it clear that the scheme of the legislation was to provide machinery for the compensation, on just terms, for owners of land that is acquired by an authority of the State, and to establish new procedures for such acquisition to simplify and expedite the acquisition process.
It was also noted that the objects of the Act included encouragement of the acquisition of land by agreement instead of compulsory process. It is uncontroversial in these proceedings, and evident in the material placed before me on affidavit, that there has been some years of negotiation between the defendant (and its predecessor council) and the plaintiffs, correspondence usually referring to the negotiators for the land owners broadly as "The Baptist Church".
It was argued that an acquisition of land can occur under the Just Terms Act by agreement or by compulsory process pursuant to s 5(1). The substantive act of compulsory acquisition occurs by publication in the Gazette of a notice stating the land had been acquired: s 19(1). By virtue of that action, the land is then vested in the authority of the State free of any prior interest in accordance with s 20(1).
The validity of an acquisition is not affected by any failure to comply with the Act, and s 33 of the Just Terms Act supports that position. The argument was further developed in oral submissions. Section 33 provides:
33 Validity of compulsory acquisition
Once land has been acquired by compulsory process under this Act, the validity of the acquisition is not affected by:
(a) a failure to comply with any requirement of this Part relating to the giving of notice of the proposed acquisition, or
(b) a subsequent failure to comply with a requirement of this Act relating to the acquisition.
It was argued that this provision, falling as it does within Part 2 of the Just Terms Act titled "Acquisition of land by compulsory process" has an overarching significance. The role of the PAN is to assist in the processing of claims for compensation. Any former owner of the land is granted the right to be paid compensation pursuant to s 37. By virtue of s 33, that former owner retains that right post-acquisition, whether they were notified or made a claim prior to acquisition or not.
It was argued that s 46(1) suggests that the right to compensation is not dependent upon a person receiving a PAN. Section 46(1) provides as follows:
A person who has not been given a compensation notice may nevertheless lodge with an authority of the State a claim for compensation under this Part.
It was argued that the Just Terms Act does not require any authority of the State to engage in a precise identification of the range and extent of interest holders to be affected by the acquisition. Section 53(1) provides the mechanism by which compensation for an interest not known to the acquiring authority can be debated and paid, and not only contemplates but provides a mechanism for the dealing with interests in the land not known to the acquiring authority at a time when compensation was paid.
An authority of the State is directed to give notice of an intention to acquire land (s 11(1)), but the parties are still free to negotiate or agree to a different outcome. Once the 90 day period has expired, the Just Terms Act directs the authority to act as soon as practicable to acquire the land. In this context the PAN serves two important functions relating to timing:
1. It provides certainty that an acquisition is likely to occur; and
2. It provides some security of continuity in the short term that acquisition will not occur for at least 90 days.
The defendant submitted that the primary purpose of the content of the PAN is to provide its recipient, (being primarily registered proprietors or interest holders and occupants) with notice of the likely date by which the land will be acquired (s 15(d)), and to provide them with the claim form to be completed in order to make a claim for compensation in accordance with s 15(e)-(f).
Neither the text nor the structure of the Just Terms Act supports the assertion made by the plaintiffs, in effect, that no action can be taken unless a valid PAN is issued. Nothing in ss 19 or 20 refers to the PAN, and nothing in s 37 (titled "Right to compensation of land compulsorily acquired") depends on a person having received a PAN. Accordingly, the defendant argued, the issue of a PAN is not an essential precondition to a lawful acquisition particularly given s 33 expressly provides for the validity of an acquisition, unaffected by alleged non-compliance with its terms.
When read together, both the text and context of the Just Terms Act suggests the preceding requirement to provide notice of an acquisition is not intended to be a step essential and preliminary to a valid acquisition.
In any event, it was argued that there was compliance with the requirements of ss 11 and 12. The PAN was sent to the registered proprietor of the land (the Union) in satisfaction of the requirements of s 12(1)(a) that a PAN be given to owners of the land who have a registered interest in the land.
It was submitted that nothing in the Property Trust Act was relevant to determine if there had been a breach of the Just Terms Act because first, the Just Terms Act is intended to prevail over any other Act relating to the acquisition of land (s 8); second, it was argued that nothing in the Property Trust Act altered the status of the first plaintiff (the Union) as registered proprietor, or the status of the register is the paramount source of information regarding land title (compare City of Canada Bay Council v F & D Bonaccorso Pty Ltd [2007] NSWCA 351 at [75], [85], [88]). Third, it was argued that the language of the Property Trust Act was ambiguous; s 16(1) of the Property Trust Act operated upon property that had previously been vested in the Union upon trust, in which case it is only that property which, by force of s 16(1) of the Property Trust Act, was then vested in the Trust. It was not a vesting of the fee simple. This vesting is not expressed in a way that would affect any proprietary interest or trust on which the property was held (s 16(3), (5)). It is not clear that the purpose of the Property Trust Act was to alter the status of the legal owner of the land, or whether it was only to confirm a new arrangement for the trusteeship over the land.
It was submitted that the material published on the Baptist Church's website referring to the operation of the Trust is far from clear as to what "property" has been "divested". The plaintiffs had argued that the material available from interrogating the website of the "Baptist Churches of New South Wales and the Australian Capital Territory" provided relevant information about the Trust if election was made to visit the part of the website relating to "Baptist Property Trust". There was an entry portal titled "Property Trust Concept" and a link to certain published information could then be followed. On p 3 of the "Property Trust Concept" document, (annexure J to the affidavit of Trevor Ian Cork sworn 17 March 2017) appears the following material under the heading 'The Property Trust as Trustee':
By 1984, Baptists in New South Wales had voted to separate the functions of the Union so that the Union could concentrate on its denominational mission. A new Act of the New South Wales Parliament was passed, called the 'Baptist Churches of New South Wales Property Trust Act 1984', and immediately the trusteeship of local Baptist Church property passed to the newly incorporated trustee called Baptist Churches of New South Wales Property Trust (which we will refer to in this article simply as The Property Trust). Substantially the same trusts continue to apply as under the formal Schedule B, although some of the wording has been modernised and expanded.
The defendant submitted that this information, even if it should have been accessed by the defendant, was far from clear and does not affect the validity of or need to serve a PAN on the first plaintiff.
Fourthly, it was submitted that s 33(1) of the Trusts Act suggested that it would require a PAN to be read as if any reference to the Union were a reference to the Trust. Section 33(1) provides:
33 Construction of certain instruments
(1) To the extent to which, by a deed, will or other instrument that takes effect on or after the appointed day, any property:
(a) is devised, bequeathed, given, granted, released, conveyed or appointed to the Baptist Union or any committee of the Baptist Union or any unincorporated agency of the Baptist Union, in each case for the benefit of, or in trust for, any Baptist Church or District Association or for the religious, social, educational or charitable work of any Baptist Church or District Association, or
(b) is payable to, or receivable or recoverable by, the Baptist Union or any committee of the Baptist Union or any unincorporated agency of the Baptist Union, in each case on behalf of any Baptist Church or District Association or for the religious, social, educational or charitable work of any Baptist Church or District Association,
the deed, will or other instrument shall be read and construed as if any reference in it to the Baptist Union or to a committee of the Baptist Union or to any unincorporated agency of the Baptist Union were a reference to the Trust, which shall take, receive or recover, as the case may require, the property in its name, but for the benefit of, or in trust for, the Baptist Church or District Association or for the religious, social, educational or charitable work of the Baptist Church or District Association, as the case may be. (Emphasis added)
In response to the plaintiffs' claim that the PAN was deficient for failing to include a signature, the defendant argued that these were not requirements of the form approved by the Minister, and in any event, these could be cured as mistake pursuant to s 16 of the Just Terms Act.
[10]
Defendant's arguments as to why the forms of relief sought by the plaintiffs are inappropriate and/or cannot be granted
The defendant also raised particular issues regarding the orders sought by the plaintiffs in the Further Amended Summons. In relation to the first proposed orders 1 and 1A, it was submitted that a declaration would not have any utility because a PAN does not regulate or determine rights, so a declaration as to the validity of the PAN achieves nothing.
In relation to the proposed orders 2 and 2A, for the same reason, certiorari could not issue against the PAN or Amended PAN (Ainsworth v Criminal Justice Commission (1992) 175 CLR 564 at [36]).
It was argued that there is no utility is making the third proposed order because the purpose of the Just Terms Act and its operation is that once the gazetting has occurred, all prior interests are extinguished. The Act then provides mechanisms by which anyone who formerly held an interest can make a claim for compensation. There is no utility, it is argued, in the Court making an order about the first plaintiff's absence of interest in the land in the circumstances.
In relation to the fourth and fifth proposed orders, the defendant argues that these are based on a misapprehension of the legislative operation of the Just Terms Act. The PAN does nothing to acquire any interest in land, and there are no interests acquired on publication of the notice pursuant to s 19(1) because the operation of s 21 is that all interests of any kind are extinguished. Attention to the statutory scheme demonstrates the misconceptions the plaintiffs held. The declarations proposed lack any utility.
In relation to the sixth proposed order, it is submitted that the PAN does not control what the defendant may or may not do in relation to publication of a notice under s 19(1), leading to the consequences as provided for in s 20(1). The relief sought is misconceived.
In relation to the seventh proposed order, it was argued that it was inappropriate to 'restrain the publication' of a notice under s 19(1). It was argued that the language is confusing as to the relief sought, and is unclear as to whether it was seeking relief against the substantive action proposed to occur under s 19 (and therefore it is unclear what right or interest the plaintiffs are seeking to protect if the relief sought is injunctive) or what decision they are seeking to prohibit (if the relief is prerogative/constitutional). The decision to acquire the subject land was made by the council by resolution some years ago and there is no challenge to that decision. This submission was also developed in oral submissions that there would be difficulty ordering prohibition against what was, in effect, a State instrumentality with the task of publishing the notice under s 19(1), in circumstances where they were not a party to the litigation, nor present to be heard on the issue.
[11]
Preliminary consideration: s11 and 12 requirements - jurisdictional?
It was common ground between counsel that the requirements of s 11 in terms of the persons upon whom notice should be served should be read subject to s 12. The plaintiff argued compliance was a jurisdictional precondition - the defendant argued that it could not be found to be so when the purpose and context of the legislation was properly considered.
In support of its argument, the defendant relied upon Project Blue Sky Inc v Australian Broadcasting Authority (194 CLR 355; [1998] HCA 28 at CLR 388-391. The focus of the decision was whether an act done in breach of a condition regulating the exercise of a statutory power was necessarily invalid, and the question as to whether it was depended upon whether it was a purpose of the legislation to invalidate any act done in breach of the condition. In the judgment of McHugh, Gummow, Kirby and Hayne JJ, the question was dealt with this way:
[91] An act done in breach of a condition regulating the exercise of a statutory power is not necessarily invalid and of no effect. Whether it is depends upon whether there can be discerned a legislative purpose to invalidate any act that fails to comply with the condition. The existence of the purpose is ascertained by reference to the language of the statute, its subject matter and objects, and the consequences for the parties of holding void every act done in breach of the condition. Unfortunately, a finding of purpose or no purpose in this context often reflects a contestable judgment. The cases show various factors that have proved decisive in various contexts, but they do no more than provide guidance in analogous circumstances. There is no decisive rule that can be applied is not even a ranking of relevant factors or categories to give guidance on the issue.
[92] Traditionally, the courts have distinguished between acts done in breach of an essential preliminary to the exercise of a statutory power or authority and acts done in breach of a procedural condition for the exercise of a statutory power or authority. Cases falling within the first category are regarded as going to the jurisdiction of the person or body exercising the power or authority. Compliance with the condition is regarded as mandatory, and failure to comply with the condition will result in the invalidity of an act done in breach of the condition. Cases falling within the second category are traditionally classified as directory rather than mandatory. … However, statements can be found in the cases to support the proposition that, even if the condition is classified as directory, invalidity will result from non-compliance unless there has been "substantial compliance" with the provisions governing the exercise of the power. But it is impossible to reconcile these statements with the many cases which have held an act valid where there has been no substantial compliance with the provision authorising the act in question.
[93] … They are classifications that have outlived their usefulness because they deflect attention from the real issue which is whether an act done in breach of the legislative provision is invalid. The classification of a statutory provision as mandatory or directory records a result which has been reached on other grounds. The classification is the end of the inquiry, not the beginning. That being so, a court, determining the validity of an act done in breach of a statutory provision, may easily focus on the wrong factors if it asks itself whether compliance with the provision is mandatory or directory and, if directory, whether there has been substantial compliance with the provision. A better test for determining the issue of validity is to ask whether it was a purpose of the legislation that an act done in breach of the provision should be invalid. This has been the preferred approach of courts in this country in recent years, particularly in New South Wales. In determining the question of purpose, regard must be had to 'the language of the relevant provision and the scope and object of the whole statute' (77 - Tasker v Fullwood [1978] 1 NSWLR 20 at 24. (emphasis added) (notes omitted)
I accept the defendant's argument that the objects, provisions and structure of the Act supports a conclusion that it was not the purpose of the legislation that an act done in breach of s 12 amounts to jurisdictional error. When regard is had to the language of the relevant provisions and the scope and objects of the statute, it is directed to just compensation and prompt action after gazettal for land acquisition, and to ensure the maintenance of rights of persons to claim compensation after land acquisition had occurred. This specifically includes circumstances where a person had not been notified of the land acquisition and/or the authority was not aware of the owner or interest holder's position in relation to the land.
I reject the plaintiffs' submission that service of a PAN on every owner as defined is a jurisdictional requirement that has to be met before the acquisition can proceed. Other authorities cited by the plaintiff that deal with other legislative schemes entailing a notice requirement do not inform the decision that needs to be made in respect of this legislation.
[12]
Was the PAN served on the first plaintiff valid?
I find that s 12(1)(a) of the Just Terms Act has been complied with in relation to the first defendant, the Baptist Union. The PAN served upon it is validly directed to that entity, given its status as registered proprietor. Putting aside any argument as to what extent of legal or equitable interest it retains, the first plaintiff has, at its most fundamental level, a "registered interest in land" as defined in the Just Terms Act being an interest in the land "recorded in the Register kept under the Real Property Act 1900".
The term "Interest" is very widely defined in s 4 of the Just Terms Act to denote:
1. A legal or equitable estate or interest in the land, or
2. An easement, right, charge, power or privilege over, or in connection with, the land.
At the very least, the Union, being the registered proprietor of the land has a "right, power or privilege over or in connection with the land", and therefore fits within the defined circumstances. The PAN served upon the first plaintiff, the Union, is a validly directed PAN.
It was argued on behalf of the plaintiffs that the provisions of s 16(1) of the Property Trust Act had the effect of fully divesting the Union of any legal or equitable interest in the land. The defendant submitted in response that, in effect, what was divested by virtue of s 16 of the Property Trust Act was merely the trusteeship passing from the previous trust holder to the newly constituted Baptist Churches of New South Wales Property Trust, and that the fee simple remained vested in the Union.
The defendant also submitted that indefeasibility of title, once an entity is registered proprietor, continues to operate unless there is implied repeal of the indefeasibility provision of the Real Property Act 1900 (NSW) s 42 by subsequent clear legislation and the Property Trust Act does not accomplish that.
The plaintiffs argued that the provisions of the Property Trust Act undermined the indefeasibility status of a registered proprietor. The parties cited City of Canada Bay Council v Bonaccorso Pty Ltd [2007] NSWCA 351, and in particular [75], [85], and [88].
Given the determination that I have made at [69] of this judgment, I do not need to determine these issues.
[13]
Was the PAN invalid in form?
The plaintiffs argued that, due to the absence of a signature on the PAN, it did not comply with s 15. The provisions of s 15, set out in the beginning of this judgment, do propose mandatory contents for the notice, by using the term 'must'. However, the items listed in (a)-(f) of s 15 do not include a mandatory requirement that the notice be signed. That purported requirement comes from the assertion by the plaintiffs that the prescribed form has a signature bar which provides a place for a signature of the person issuing the form.
There is no issue that the other requirements for s 15 have been met. That is, the authority proposing to acquire the land has been specified, there was sufficient description to identify the land proposed to be acquired, there was a specification of the time period associated with the acquisition, and a request for any owner who wishes to claim compensation to lodge their claim within a period commencing after 60 days after the notice has been given to the owner and it was accompanied by a form for a claim for compensation pursuant to s 39.
There is power in s 16(3) to allow an Amended PAN to be served for the purpose of correcting a "clerical error" or an "obvious mistake" in a notice. The defendant exercised that amendment power and issued an Amended PAN with a signature on 22 March 2017.
The initial PAN was served with a covering letter authored by the defendant's solicitor, and in that letter was the name of a council representative (with whom the Church had been dealing for some years) together with a direct phone number for that person identified in the letter as the person to contact "in the case of any queries". In those circumstances, I conclude that the failure to include a signature on the PAN does not invalidate the PAN, and if I am wrong about that, it is in the nature of a clerical error or an obvious mistake that has been remedied by the service of the Amended PAN. I conclude that the Amended PAN is a valid PAN.
[14]
Constructive knowledge argument
It was argued by the plaintiff that based on Crane v Waverley Council [2012] NSWLEC 142, the Council had an obligation or duty to enquire. I accept the defendant's submission that the reliance on this case is misplaced. That case dealt with the requirements under the Local Government Regulations to carry out diligent enquiry where a council could not locate any owner of the land it wished to compulsorily acquire.
Counsel for the defendant candidly admitted that there was an argument that it should have entered the property to determine whether the land was occupied by any entity or organisation. However, it was argued that the plaintiffs had no standing to argue a position for the Connect Church, which had physical presence on the land, initially pursuant to a memorandum of understanding, and subsequently a tenancy agreement which expired in June 2016, at the time of the PAN comprising a month-to-month holding over. It was also argued that failure to serve a PAN on Connect Church was of no consequence because it was not a jurisdictional requirement to gazetting acquisition.
It was asserted by the plaintiffs that because the Council premises were next door to the land, and there were notices outside the front of the Church buildings referring to the Connect Church, the defendant was on, (in effect), constructive notice that the property was occupied and therefore a PAN should have been given to the Connect Church pursuant to s 12(1)(b), and the failure to do so was a jurisdictional error.
The machinery of the legislation in the compensation notice attached to the PAN clearly contemplates that an owner provided with the notice will assist by giving notice of its awareness of any other persons who or corporations that may have an interest in the land. The notice clearly requires that the notified owner provide full details including the name, address, and nature and extent of the interest of any other interest-holder, including after acquisition, regardless of whether the acquiring body knew of their interest: Just Terms Act ss 33, 37, 46. That other affected person or organisation would have a right to compensation, pursuant to the legislative machinery.
Given the findings I have made about the notice requirement in the context of the Just Terms Act being procedural rather than substantive, I find that there would be no jurisdictional error in proceeding to Gazettal of the acquisition notice having failed to issue a PAN to the Connect Church.
It is uncontroversial that no notice was given to the defendant as to the existence of the Trust or its role in relation to the Land. Correspondence over the years during negotiations over the sale of the Land between the 'Baptist Church' and the defendant Council contained various descriptions of the "seller" of the Land as late as March 2017 as 'Hurstville Baptist Church' (letter from McPhee Kelshaw to Mr Olliver at HWL Ebsworth), 'Blakehurst and Hurstville Baptist Churches' (letter to Hurstville City Council dated 7 July 2008 and signed by Peter Murphy, Blakehurst Baptist Church; and Matthew Hogg, Hurstville Baptist Church), and in about 2013, an application was made, apparently by 'Hurstville Baptist Church' to demolish all of the structures on the site as part of a development application.
In all those circumstances, I do not accept that the Trust would fall into the category of an owner who, pursuant to s 12(1)(c), should be given notice because the defendant had "actual knowledge" of that organisation's interest in the land. Whilst the Trust would fit the description of "owner" of an interest in the land as described in the Just Terms Act, I find that there is no jurisdictional error in proceeding to gazettal of the acquisition notice having failed to issue a PAN to the Trust.
[15]
Orders
I accept the submissions made by the defendant set out at [58]-[63] of this judgment in relation to the orders sought in the Further Amended Summons.
I decline to make any of the orders sought in the Further Amended Summons for the reasons set out above.
I confirm the orders made on Friday 31 March 2017 as follows for the reasons set out in this judgment:
1. To the extent that it is necessary, pursuant to Rule 59.10(2), I grant the plaintiffs leave to commence these proceedings out of time;
2. Dismiss the Further Amended Summons;
3. The plaintiffs pay the defendant's costs of these proceedings.
[16]
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: 06 April 2017