Walcha Council and Ors v Minister for Local Government and Ors

Land and Environment Court (NSW)|2016-05-18|Before: Moore J, Mr P, Mr J

TABLE OF CONTENTS Introduction The litigation The matters remaining from the Notice of Motion: The matters in dispute The evidence The relevant terms of the Proclamation Protecting the public interest of the Gundagai community Retention of Gundagai Council as an applicant for joinder Timing of determination Should the Gundagai Council be removed and when? A matter of standing? The presumption of validity of the Proclamation The position of Gundagai Council Ms Ferguson's determination process Ms Ferguson's second affidavit Costs Preparation of these reasons Orders Annexure A

Introduction

At 12.15 pm on Thursday, 12 May 2016, a Proclamation entitled the "Local Government (Council Amalgamations) Proclamation 2016" (the Proclamation) was published on the New South Wales Legislation website. By virtue of the provisions of cl 2 of the Proclamation, it came into effect at that time. This provision is in the following terms: This Proclamation commences on the day and at the time at which it is published on the NSW Legislation website.

The litigation

A range of proceedings challenging the validity of proposed amalgamations are to be determined by this Court. The proposed amalgamations so challenged (other than these joinder proceedings and the substantive matters arising if joinder is granted, as later explained) are all designed to forestall proposed amalgamations rather than to challenge amalgamations that were effected by the Proclamation. Those challenges are being dealt with in groups, groups which, with one exception, do not require to be detailed. The exception is a combined challenge by the Walcha, Cabonne and Oberon Councils to the proposals that each of them be merged with the nearby regional city local government body.
On 10 May 2016, the second day prior to the date of the Proclamation, Gundagai Council, as then constituted, passed the following resolution: FIT FOR THE FUTURE - MERGER PROPOSALS Moved: Cr Gain that Council: Instruct Patterson Byfield Bryen Solicitors of Walcha to act for it together with Walcha, Oberon and Cabone to have Council commence an action against the State of NSW based on a want of procedural fairness in the process leading to and consequent upon the determination of the minister (sic) for Local Government to merge Gundagai Shire, and The estimated sot of 30k be funded from a 50k contribution for legal costs of the action from the plant reserve with the Gm (sic) and mayor receiving delegated authority to contract for and progress the application. Seconded: Cr Magnone. HAVING BEEN PUT THE MOTION CARRIED.
Pursuant to this resolution, the nominated firm of solicitors prepared a Class 4 application, together with the necessary supporting documents and a Notice of Motion seeking to have Gundagai Council joined to Matter No 40360 of 2016 (the Walcha, Cabonne and Oberon Council proceedings). Those documents were filed and these Gundagai proceedings commenced on 12 May 2016 with, as is conceded by Mr Hutton, counsel for the Minister and the other Respondents, these being commenced prior to the Proclamation coming into effect at 12.10 pm.
Amongst other matters, this application sought interim restraining relief against the Minister to prevent any amalgamation involving the then existing Gundagai Council from proceeding until the various challenges raised by this Council had been determined by this Court. The matter was referred to the Duty Judge, Craig J, on 12 May 2016. His Honour enquired of those representing Gundagai Council whether the Crown Solicitor's Office (acting for the Minister and the other parties to the existing Walcha, Cabonne and Oberon Council proceedings) had been advised of this application. As they had not, his Honour stood the matter over until 3.00 pm on 12 May 2016 to permit notification to the Crown Solicitor's Office and, thus, to enable the Minister to be heard, through his legal representatives, if this was desired.
As earlier noted, the guillotine fell, as it were, at 12.10 pm that day.
At 3.00 pm, Craig J stood the matter over until 2.00 pm on Friday 13 May 2016 to enable consideration as to what should now be done with these joinder proceedings. At the appointed time, before me, Mr Hutton announced his appearance for the Minister and the other respondents and Mr King (with him, Ms Sinclair) announced their appearance for the Gundagai Council.

The matters remaining from the Notice of Motion:

The following substantive matters remain for determination: 3 Grant leave to Gundagai Shire Council to be joined as the Fourth Applicant in Class 4 proceedings case number 4036 of 2016 in this Honourable Court. 4 Order that the Statement of Claim of Gundagai Council dated 12 May 2016 be heard concurrently with Class 4 proceedings case number 40360 of 2016 in this Honourable Court, with directions accordingly.

The matters in dispute

It was readily apparent from the positions advanced by Mr King and Mr Hutton that afternoon that Mr King considered that there remained an appropriate basis upon which the joinder proceedings could continue under the name pursuant to which they had been commenced (and with this being that nominated body, Gundagai Council, constituted as it had been constituted prior to the 12.10 pm Proclamation on 12 May 2016).
The position advanced by Mr Hutton was that this was inappropriate because: 1. Gundagai Council as it had existed had, as at 12.10 pm on 12 May 2016, been consolidated into the new Gundagai Council comprising the former Gundagai and (now) former Cootamundra Council; 2. The person with the authority to carry out the functions of an Administrator of the new Council and Mayor of the new Council was Ms Christine Ferguson; 3. This position arose as a consequence of a number of express provisions contained in the Proclamation and Schedule 7 attaching thereto; 4. Ms Ferguson had provided an e-mail to an officer of the Crown Solicitor's Office, which officer (Mr Minson) had provided an affidavit disclosing Ms Ferguson's intentions to terminate the proceedings and to withdraw the instructions of those who instructed Mr King and Ms Sinclair; and 5. An affidavit from Ms Ferguson would be provided prior to any further consideration of these issues.
In order to enable these issues to be determined in a timely fashion, the matter having been transferred from Craig J to me during the morning of 13 May 2016 (as I was dealing with procedural matters in the remaining groups of council proceedings), I adjourned the hearing until 2.00 pm on Monday 16 July 2016 in order to deal with the substantive issues.
These issues, I consider, can be summarised as follows: 1. If the proceedings continue in the name of the Gundagai Council, are those proceedings to continue and, if so, with that title referring to the former Council or should that term refer to the body created by the Proclamation having the name of the Gundagai Council? 2. Whether I should determine that issue as part of these preliminary, procedural hearings for joinder or should that matter be stood over to the substantive hearing and dealt with concurrently with the merits of the Walcha, Cabonne, Oberon and Gundagai proceedings? And 3. If the proceedings were to continue by deferring what Mr King describes as the "standing" point, but Mr Hutton describes as the "existential" point, what pre-trial directions should be made to ensure that the Gundagai issues were ready for trial along with the Walcha, Cabonne and Oberon proceedings?

The evidence

When the hearing resumed on 16 May 2016, evidence was received by the reading of three affidavits and the tendering of three documents.
Mr King read the affidavit of Mr Phillip McMurray, the person who had held the office of General Manager in the former Gundagai Council and who, by virtue of the provisions of Schedule 7 to the Proclamation, now held the office of the Deputy General Manager of the amalgamated Gundagai Council. Mr McMurray's affidavit attached, as Annexure A, the minutes of the meeting of the then Council of 10 May 2016 containing the already quoted resolution authorising the commencement of, and funding for, these proceedings.
Mr King also tendered two documents. These were a consolidated set of audited accounts of the former Gundagai Council as at 30 June 2015 (Exhibit A) and a letter from his instructing solicitors to the Crown Solicitor's Office proposing a draft set of Short Minutes (Exhibit B) for consideration should the substantive proceedings go ahead with Gundagai Council joined as a party to them.
For the Minister and the other Respondents, Mr Hutton read the affidavit of Mr Rowan Minson, a solicitor employed in the Crown Solicitor's Office, and an affidavit of Ms Ferguson.
Mr Minson's affidavit had attached to it, as Annexure RAM-1, an e-mail attaching a copy of the executed Executive Council Minute and the executed Proclamation. These having earlier been provided to Mr King, and those with him, the issue of the validity of the Proclamation had fallen away on the afternoon of Thursday 12 May 2016 before Craig J.
Also attached to Mr Minson's affidavit, as Annexure RAM-2, was the e-mail correspondence and a copy of a draft letter that Ms Ferguson proposed to send to Mr King's instructing solicitors, together with, as Annexure RAM-3, a copy of an e-mail to a person who appeared to be an employed solicitor of those instructing solicitors (with that e-mail attaching a copy of the draft letter). That e-mail also stated the following: Accordingly, as it is clear now, if it was not before, that the client for which you purport to act has been dissolved and that you do not hold instructions from the administrator, I am instructed to invite you to immediately discontinue these proceedings. In the event that you have not confirmed that you will do so by 10 am tomorrow, I will seek instructions from my client to seek an order for indemnity costs against you and your counsel.
In light of this, the question of costs was confirmed as being a live issue in these proceedings (as might ordinarily be expected to have been the case). Mr Hutton also tendered an e-mail from Ms Ferguson confirming that the draft letter had been sent in the terms attached to that e-mail (Exhibit 1). A copy of the letter attached to Exhibit 1 is appended to this judgment.

The relevant terms of the Proclamation

I have earlier set out the terms of cl 2 of the Proclamation and reference to the incorporation of the name of, and boundaries for, the new Gundagai Council created by the amalgamation of the former Gundagai and Cootamundra Councils as set out in the table at cl 4 of the Proclamation. It is unnecessary to repeat further detail of these. I have also noted that, relevantly, Schedule 7 effected the appointment of Ms Christine Ferguson as Administrator and with the functions of Mayor (cl 12(3) of the Proclamation) of the amalgamated council and that Mr McMurray has been appointed as Deputy General Manager of the amalgamated council.
There are, however, a number of other provisions of the Proclamation that require to be noted. The first element of these are contained in the definitions provision in cl 3(1) of the Proclamation with those definitions being: amalgamation day means the time of the day on which this Proclamation commences. assets means any legal or equitable estate or interest (whether present or future, whether vested or contingent and whether personal or assignable) in real or personal property of any description (including money), and includes securities, choses in action and documents. former council means the council of a former area. liabilities means any liabilities, debts or obligations (whether present or future, whether vested or contingent and whether personal or assignable). rights means any rights, powers, privileges or immunities (whether present or future, whether vested or contingent and whether personal or assignable).
The powers and functions of Ms Ferguson (and those holding analogous offices in other amalgamated councils created by the Proclamation) are set out in cl 12(3) of the Proclamation. This provision is in the following terms: (3) The Administrator of a new council has, during the initial period, the functions of the council and the mayor of the council. This subclause is subject to the provisions of this Proclamation and to any order appointing another Administrator.
Ms Ferguson's affidavit of 15 May confirmed her intention to send the letter that had been foreshadowed and had a copy of that letter, signed by her, annexed to her affidavit.
The next relevant provision in the Proclamation is that contained in cl 33. It is not necessary to repeat the totality of that provision but merely to reproduce the elements of it relevant to these proceedings. These are: 33 Provisions relating to transfers of assets, rights and liabilities (1) When any assets, rights or liabilities are transferred pursuant to this Proclamation from a former council to a new council, the following provisions have effect: (a) ..., (b) ..., (c) all proceedings relating to the assets, rights or liabilities commenced before the transfer by or against the former council or a predecessor of the former council and pending immediately before the transfer are taken to be proceedings pending by or against the new council,

Protecting the public interest of the Gundagai community

Early in the resumed hearing, in response to a submission from Mr King to the effect that it would not be appropriate to terminate the right of the former Gundagai Council to maintain these proceedings because there was a public interest issue for the Gundagai community in them going ahead, I pointed out that an adverse finding by me about the ability of the commencing party to maintain the proceedings would not extinguish all rights, to have the issues pleaded, determined in fresh proceedings.
I pointed to the fact that there was an open standing provision in the Local Government Act 1993 (the Local Government Act) that permitted proceedings to the same effect to be commenced afresh, if necessary or, indeed, it was possible for him to seek leave, should he have instructions to do so, to add persons as applicants to these joinder proceedings (subject to my resolution of any objections (if any) raised on behalf of the Minister not finding favour) so that the proceedings could continue even if the commencing party were appropriate to be removed. The open standing provision of the Local Government Act, s 674, reads relevantly: 674 Remedy or restraint of breaches of this Act - other persons (1) Any person may bring proceedings in the Land and Environment Court for an order to remedy or restrain a breach of this Act.
Mr King then indicated that he did, in fact, have instructions from Mr Albert McAlister, the Mayor of the former Council, and Mr David Graham, the Deputy Mayor of the former Council. When I enquired whether he was seeking for them to be joined as applicants to these joinder proceedings, he indicated that this was the case.
On instructions, Mr Hutton indicated that that course was not opposed by the Minister, but that the Minister continued to seek removal of the descriptor "Gundagai Council" (whatever that might mean in the post Proclamation context) as an applicant in the joinder proceedings.
As a consequence of Mr McAlister and Mr Graham being added as applicants in these joinder proceedings, the public interest of the Gundagai community in having the matters in contest determined by this Court is potentially retained and, if joined, a following consequence being whatever the outcome with respect to the continuation or otherwise of "Gundagai Council" as an applicant for joinder, prehearing timetabling directions leading up to and (and confirming the date of) the hearing of this application on 24 and 25 May 2016 could be made.
Given the conclusion I have reached, these procedural directions are incorporated in the orders at the conclusion of this judgment.

Retention of Gundagai Council as an applicant for joinder

Mr King handed up an extract from the Australian Law Reform Commission Report No 27 entitled "Standing in Public Interest Litigation" and took me, particularly, to comments made on pages 26 and 27. The relevant portions upon which he relied were in the following terms: Procedure in Determining Standing 128 Discretion to Determine Standing as a Preliminary Issue. If the standing of a plaintiff is expressly conceded or is not contested by any other party, the issue need not be judicially determined. But if the issue is raised, the court has a discretion whether to determine standing as a preliminary issue or in conjunction with the merits of the case. Sometimes, the court decides at the outset that the plaintiff has no standing and proceeds no further with his claim. In other cases, standing may depend upon the resolution of many questions and therefore cannot be divorced from a consideration of the merits. It will then be determined with all other issues at the conclusion of the hearing. In one sense, it is logical to treat the question of standing as a preliminary issue, which should precede the consideration of the action on its merits. If the plaintiff has no standing, the substantive issue need not be considered and a great deal of court time and expense may be saved. However, it is an over-simplification to assume that this is always the best approach. A premature ruling on standing in a complex case may be a 'false economy'. In Robinson v Western Australian Museum, Justice Gibbs (as he then was) discussed the problem in these terms: The Court has a discretion: it is not bound to take one course rather than the other. If the plaintiff's claim to have a locus standi is merely colourable and can easily be exploded, the court will no doubt proceed immediately to decide the question of standing and, having decided it against the plaintiff, will dismissed the action. But if the investigation of the claim requires the consideration of weighty and complex questions which may never fall for decision, if the issue of validity is decided against the plaintiff, it may be more convenient to proceed immediately to determine the validity of the challenged statute. In Onus v Alcoa of Australia Ltd Chief Justice Gibbs reiterated this view and commented that it was unfortunate that the issue of standing had in that case been dealt with as a preliminary issue, particularly as the material before the court was scanty. Similarly, in Inland Revenue Commissioners v National Federation of Self Employed and Small Businesses Ltd, Lord Wilberforce described as 'unfortunate' the fact that standing had been singled out for decision as a preliminary issue and suggested that, except in obvious cases, standing should be considered with all other issues. Often, he said, the question whether there was a 'sufficient interest' (this was the criterion of standing being applied) depended on a judgment which took the legal and factual content of the case into account. (citations omitted)
In addition, he relied on a number of decisions as supporting the proposition that it would be appropriate to permit the commencing party being (joined and) retained as an applicant in the proceedings, unless determined by the trial judge as an element of determination in the substantive proceedings that this was not appropriate.
In that context, I understood Mr King to be submitting that this was the appropriate basis for ensuring that the general challenge to the validity of the Proclamation (this challenge being based on statutory construction issues common to Walcha, Cabonne, Oberon and Gundagai) was maintained for Gundagai Council.
As well, such retention would ensure consideration of the particular and idiosyncratic issues relating to the process leading up to the amalgamation with Cootamundra Council in circumstances where Mr King proposed to mount an argument not only of a general procedural fairness nature about the Gundagai process but also a Gundagai-specific argument concerning what I choose to describe as the intermingling of two possible amalgamation proposals (Gundagai and Cootamundra being the first and Gundagai, Cootamundra and Harden being the second).
Mr King indicated he proposed to explore whether or not the Minister referring the second of these amalgamation possibilities to the Chief Executive of the Office of Local Government and, thence, to the same delegate of the Chief Executive as was appointed to enquire into and report upon the first proposal rendered the subsequent process of reference of the delegate's report (into the first proposal) to the Boundaries Commission invalid. If so, it was his outline of the course he sought to pursue that the subsequent step - the Minister's adoption of, and giving effect to, the first amalgamation proposal - was so tainted by that invalidity that the totality of the process that the Proclamation proposing the giving effect to the first Gundagai amalgamation process was, on that specific basis, void.
In support of this broad proposition of permitting the maintenance of the commencing party as an applicant, Mr King took me to a number of decisions that, in general terms, supported the approach set out in the extract from the Australian Law Reform Commission. These decisions were:

Robinson v Western Australian Museum (1978) 16 ALR 623 at pp 641-2
Onus v Alcoa of Australia Ltd (1981) 149 CLR 27 at p 33
Inland Revenue Commissioners v National Federation of Self Employed and Small Businesses Ltd [1982] AC 617 at p 630 [242]-[244]

It is not necessary to set out the detail of the extracts to which Mr King took me.
Contra this position, Mr Hutton raised a number of separate reasons which he submitted provided an adequate and compelling basis why the name of the party commencing the joinder proceedings should be removed from the joinder proceedings.
However, for the reason set out in the next sections, I am satisfied that it is appropriate to remove the entity entitled "Gundagai Council" as an applicant in these joinder proceedings. Therefore, it is unnecessary to address the other grounds advanced by Mr Hutton to support my reaching that conclusion.
There is, however, one further minor procedural matter concerning the basis of participation by Mr King and Ms Sinclair (and those instructing them) that requires to be dealt with and this is the subject of a later, confined section of this decision.

Timing of determination

It is unnecessary to deal with Mr Hutton's points in support of his submission about the appropriate timing for determination as to whether or not Gundagai Council should remain nominated as an Applicant in these joinder proceedings.
This arises because the relevant dominating factor that might have militated in favour of retention, namely, the public interest of the Gundagai community being preserved for determination at the trial, has now been preserved by the addition of Mr McAlister and Mr Graham, as Applicants in these Notice of Motion proceedings, and by my subsequent formal order adding them as parties to the substantive matter. In light of this preservation of the substantive issues, I am satisfied that it is appropriate to proceed immediately to determine whether or not the Gundagai Council should be removed as an Applicant for joinder.

A matter of standing?

Viewed through the correct conceptual lens, it is clear that what requires determination in these preliminary proceedings is not whether Gundagai Council has standing to continue the proceedings, as it is obvious from that which follows I am satisfied that there is a (then) existing entity known by the title "Gundagai Council" that had standing to commence the proceedings and that there is also a (now) existing entity known by the title "Gundagai Council" (but of a different composition), and that this latter entity would have standing to maintain the proceedings should that entity determine that it wished to do so.
Viewed in that fashion, there is, in reality, no issue of standing engaged, nor is there any "existential issue" arising. What does require to be ascertained is what is the attitude of the entity that has standing to the maintenance of its status as an applicant on this motion in circumstances where, at the time it falls to me to make orders determining that position, there would be, as a consequence of the sequencing of the orders set out at the end of these proceedings, three applicants (if only fleetingly) prior to my making an order dispositive of this joinder aspect of the substantive proceedings if the entity wished to be removed and validly determined to effect that outcome.

The presumption of validity of the Proclamation

Mr Hutton submitted, in effect as I understood him, that I was obliged to presume that the Proclamation was valid but that, if I was not so obliged, I should, as a matter of discretion, proceed on that basis. In making this submission, he relied on passages from a number of decisions, both English and Australian, in support of this proposition. These decisions were:

Forbes v New South Wales Trotting Club Ltd [1979] HCA 27; 143 CLR 242;
Hoffmann-La Roche v. Secretary of State for Trade [1975] AC 295;
Ousley v R [1997] HCA 49; 192 CLR 69.
R v Balfour; Ex parte Parkes Rural Distributions Pty Ltd (1987) 17 FCR 26

As with the decisions relied upon by Mr King on the question of timing, it is unnecessary to reproduce or further advert to the extracts to which I was referred. It is sufficient to note that they emphasise, in my summary of their import, the proposition that legislation or legislative instruments should be presumed to be valid unless there is some compelling reason why some contrary finding should be made.
Mr Hutton also relied on s 45 of the Interpretation Act 1987 (the Interpretation Act), a provision dealing expressly with this issue of the presumption of validity. This provision is in the following terms: 45 Presumption of validity of certain instruments (1) It shall be presumed, in the absence of evidence to the contrary, that all conditions and preliminary steps precedent to the making of an instrument have been complied with and performed. (2) In this section: instrument means: (a) an instrument: (i) that is made by the Governor, or (ii) that is made by a person or body other than the Governor, but is required by law to be approved or confirmed by the Governor, or (b) a rule of court, or (c) an environmental planning instrument, being an instrument or rule of court that is required by law to be published on the NSW legislation website or in the Gazette.
On this point, is Mr King submitted that the material contained in Mr McMurray's affidavit, particularly the resolution of the initiating council to commence these proceedings, provided such an appropriate evidentiary basis. He also handed up, in his outline of submissions, a chronology that he said assisted to support the evidence of Mr McMurray.
For the purposes of the approach set out in the authorities to which Mr Hutton has referred me, and the context of qualification in the words, "in the absence of evidence to the contrary", in this provision of the Interpretation Act, there is no basis in Mr McMurray's evidence that could provide a proper foundation to set aside the presumption of validity. As a consequence, I now turn to the matters that are necessarily engaged by the acceptance of that presumption.

The position of Gundagai Council

I have earlier set out the relevant provisions of the Proclamation that are required to be considered. As a consequence, this analysis can be set out by noting the sequential steps that I am satisfied necessarily arise, in this context, prior to the Proclamation, and then arise from the terms of the Proclamation. These are: 1. On 10 May 2016, Gundagai Council, as it was then constituted, validly resolved to commence these joinder proceedings and if joined, to pursue the remedies set out in its initiating process; 2. Prior to 12.10 pm on 12 May 2016, Gundagai Council (as then constituted) commenced proceedings in this Court; 3. At 12.10 pm on 12 May 2016, the Proclamation came into effect by dint of the combination of cl 2 of the Proclamation and its publication on the New South Wales Legislation website; 4. Gundagai Council, as constituted at the time of the resolution to commence these proceedings, became the former Gundagai Council by a combination of the amalgamation of Gundagai and Cootamundra Councils into the new Gundagai Council by virtue of the Proclamation and the attachment of descriptor "former" to the earlier constituted body by virtue of the definition of "former Council" contained in cl 3(1) of the Proclamation; 5. Relevantly, all rights with respect to these proceedings were transferred to the amalgamated Council as a consequence of the provisions of cl 33(1)(c) of the Proclamation; 6. Responsibility for determination of what should be the position of the new Gundagai Council to these proceedings lies with the person appointed as Administrator of the Council by virtue of cl 12(3) of the Proclamation, giving the Administrator the powers and functions of the amalgamated Council and of the Mayor of that Council; 7. The appointment, by the effect of Schedule 7 to the Proclamation, of Ms Christine Ferguson as the Administrator of the amalgamated Council; and 8. The determination by Ms Ferguson, as shown in her evidence, that Gundagai Council should no longer continue to be an applicant to the motion for joinder in these proceedings.
Subject only to the consideration below of the method and timing of effecting the determination by Ms Ferguson, it is clear that the inevitable consequence is that I should order the removal of the Gundagai Council as an applicant for joinder to these proceedings.

Ms Ferguson's determination process

Mr King raised the question of whether or not the correspondence of Ms Ferguson (in evidence by virtue of the combination of her affidavit, Mr Minson's affidavit and Exhibit 1) provided a proper foundation for me to give effect to the outcome of the sequence set out above. This submission was made on the basis that the commencement of the proceedings was founded on a properly minuted resolution of the former Council and that the matters set out in Ms Ferguson's correspondence did not, in the appropriate formal fashion, constitute a proper rescission of that resolution.
In response, Mr Hutton took me to the provisions of the Local Government Act dealing with the appointment of Administrators to individual councils - provisions utilised in narrower circumstances than here arise for consideration. That suite of provisions in the Local Government Act encompasses, in s 258, the relevant matters concerning the role of an Administrator in those circumstances. He drew my attention to the fact that the nature of the role in those circumstances differed from the role devolved to Ms Ferguson as a consequence of the relevant provisions of the Proclamation (particularly the express devolution to her of the role and functions of the Mayor of the amalgamated Gundagai Council).
I indicated to Mr Hutton that it was my understanding, from matters on the public record, that, in the most recent appointment of an Administrator under the general provisions, that of an Administrator to the then Warringah Shire Council, the Administrator had held meetings that constituted formal meetings of the Council at which the Administrator dealt with items on an agenda and adopted resolutions to deal with them.
As there was no evidence that this process had been followed by Ms Ferguson, I suggested to Mr King and Mr Hutton that I should adjourn the matter, briefly, to enable this matter to be considered and, if necessary, a further affidavit dealing with purely this procedural point should be permitted to be filed by Ms Ferguson.
Mr Hutton did not oppose this course of action, but Mr King did - on the basis that if I were to stand the matter over to be determined by the trial judge, it was unnecessary to do so. By inference from this submission, were I to have adopted that course, such material could have been provided by Ms Ferguson as a consequence of the directions that Mr King proposed be made - setting a timetable for the filing and serving of evidence in the period leading up to the substantive hearing.
I concluded that it would be appropriate to afford Ms Ferguson the opportunity, in the confined fashion outlined, to provide a further affidavit (should she wish to do so), as it appeared this was potentially an integral element in my determination as to whether Gundagai Council had validly established the position that it no longer wished to be an applicant in these joinder proceedings. As a consequence, I adjourned the hearing until 9.15 am on Wednesday 18 May 2016.

Ms Ferguson's second affidavit

As earlier noted, I had permitted a second affidavit to be deposed by Ms Ferguson. Such an affidavit was read by Mr Hutton at the resumed hearing this morning. That affidavit set out the formal process undertaken by Ms Ferguson to adopt a resolution of the (now) Gundagai Council to terminate the instructions of Mr King, Ms Sinclair and their instructing solicitors to appear for Gundagai Council (however personified) in these joinder proceedings. Her affidavit also evidences the fact that the (now) Council has resolved not to seek to be joined as a party to the substantive proceedings. It is, in the circumstances, appropriate that I give effect to that resolution.
I observe, as it is a matter that arises in my discussion below of what is the appropriate costs position to adopt concerning the joinder motion, that these resolutions were adopted after Mr McAlister and Mr Andrews had been joined, without opposition from the Minister, to this joinder motion.

Costs

I have earlier set out the attitude expressed by the Acting Deputy Crown Solicitor in an e-mail to a solicitor employed by the firm instructing Mr King and Ms Sinclair. I had, originally, intended to stand the question of costs over to the hearing on the substantive Gundagai issues, a hearing to be held next week.
However, in the light of that which has been set out in Ms Ferguson's second affidavit filed and read this morning (18 May 2016) and dealt with in a hearing held earlier today, I now consider it appropriate to deal with costs of this joinder motion by retaining, myself, the resolution of this issue.
I also consider it potentially significantly relevant that, from the time that I joined Mr McAlister and Mr Graham to this joinder motion during the hearing that took place on Monday 16 May 2016, it is now apparent that, for the reasons set out in my discussion above concerning Ms Ferguson's second affidavit, that Mr King and Ms Sinclair's instructions, together with those of their instructing solicitors, may not have been validly terminated prior to the meeting of the Council held by Ms Ferguson at which the Council resolved, effectively, to rescind the initial authorising motion adopted by the (then) validly constituted Gundagai Council on 10 May 2016.
The resolution may have had the effect of rescinding the instructions for Mr King and those with him only from the time that that motion was adopted by Ms Ferguson in her capacity as the (now) Gundagai Council as a consequence of her being the Administrator of that Council and that Council having subsumed, as earlier discussed, all the rights, responsibilities etcetera of the former Council.
It therefore seems to me that, for the purposes of the issue of costs in this joinder motion, Mr King, Ms Sinclair and their instructing solicitors may arguably have been continuously instructed on this joinder motion by virtue of the overlapping of the unrescinded instructions from Gundagai Council (unless earlier validly terminated) and their instructions from Mr McAlister and Mr Andrews after they were joined to the joinder motion.
I do not, however, need to determine these points in this decision.
Under those circumstances, given that each side has succeeded in part and that there is a respectable colouring of the joinder motion as being pursued in the public interest, the question of costs should not go with the substantive proceedings but should remain with me.

Preparation of these reasons

In the interests of providing certainty as to who were to be the applicants when the final hearing of this matter commenced, and in order to provide an appropriate timetable for preparation for that hearing (together with the desirability of provision of written reasons for the conclusion that I have reached on the substantive issues), this decision was prepared (with the exceptions of the material under the headings, "Ms Ferguson's second affidavit" and "Costs" - as these were the only matters to be dealt with at the further hearing on May 18), in the period prior to that resumed hearing.
Given the necessity to prepare these reasons in circumstances where I was listed on both Tuesday 17 and Wednesday 18 May 2016 for a substantive hearing of another matter in which I was part-heard, the amount of time available for the preparation of these reasons has been more than somewhat limited.
This has led to the analysis of the various propositions and the authorities to which I was taken by both Mr King and Mr Hutton to be less extensive than might otherwise ordinarily have been expected. However, rather than seeking to take more time and produce a more expansive judgment, I was satisfied that the more skeletal approach I have taken was appropriate under all the circumstances.

Orders

The orders of the Court therefore are: 1. Albert McAlister and David Graham are added as applicants to the motion seeking to be joined to Matter No 40360 of 2016; 2. Gundagai Council is removed as an applicant to the motion seeking to be joined to Matter No 40360 of 2016; 3. Albert McAlister and David Graham are joined as applicants to Matter No 40360 of 2016; 4. The Respondents are to file and serve their Defence by 3.00 pm on 19 May; 5. The parties are to file and serve any evidence upon which they propose to rely on or before Friday 20 May; 6. The parties are to file and serve any response to the evidence by 12 noon on 23 May; 7. The parties are to prepare and file, by 3.00 pm on 23 May, a single bundle of documents to be relied upon at trial. This bundle is to be in three parts - Part A to be agreed documents; Part B to be those documents not agreed but upon which Mr McAlister and Mr Graham propose to rely; and Part C to be those documents not agreed but upon which the Respondents propose to rely; 8. Matter No 40360 of 2016 remains set down for hearing for two days commencing at 10.00 am on Tuesday 24 May 2016; 9. Exhibit A on the motion is returned; and 10. Costs of this motion to join parties to Matter No 40360 of 2016 are reserved for further hearing before Moore J if any party to the joinder proceedings notifies my Associate and the other parties by 4.30 pm on 27 May 2016 that such further hearing is required but, if no such notification is made to my Associate, each party is to bear their own costs of the joinder motion.

Annexure A Gundagai Council Sheridan St GUNDAGAI NSW 2722 Patterson Byfield & Bryen Solicitors Fitzderby Chambers Fitzroy St WALCHA NSW 2354 15 May 2016 By email [pbbwalcha@northnet.com.au] Dear Partners Revocation of your instructions to act on behalf of Gundagai Council I refer to: the Notice of Motion, Statement of Claim and Affidavit of Phillip Anthony McMurray filed in the Land and Environment Court of New South Wales (NSWLEC) in proceedings 40360 of 2016 on 12 May 2016, purportedly by your firm on behalf of Gundagai Council; and the Local Government (Council Amalgamations) Proclamation 2016 (the Proclamation), which was published on the NSW legislation website at 12.10pm on 12 May 2016 and which commenced at that time (see cl. 2). By virtue of the Proclamation: the areas of Cootamundra and Gundagai were amalgamated to constitute the new area of Gundagai (see cl. 4(1)); the councils of the former areas of Cootamundra and Gundagai (the former Cootamundra Council and the former Gundagai Council, respectively) were dissolved (see cl. 4(2)); I was appointed Administrator of the council for the new area of Gundagai (Gundagai Council) (see Sched. 7, item 3); during the initial period (as defined in cl. 3), I have the functions of Gundagai Council and the mayor of Gundagai Council (see cl. 12(3)); the assets, rights and liabilities of the former Gundagai Council were transferred to Gundagai Council (see cl. 32); and to the extent proceedings by the former Gundagai Council were pending in the NSWLEC at 12.10pm on 12 May 2016, those proceedings are now pending by Gundagai Council (see cl. 33(l)(c)). In light of the above, I write to advise that: you do not have instructions to act on behalf of Gundagai Council, either generally or in relation to NSWLEC proceedings 40360 of 2016, and any action taken by you on behalf of Gundagai Council will be taken without authority and at your own risk; and to the extent that you did in the past have instructions to act on behalf of Gundagai Council (and I make no admissions about that matter, being unsure at present about the circumstances giving rise to your purporting to act), I confirm that those instructions have been revoked. Yours faithfully Christine Ferguson Administrator, Gundagai Council

Amendments 18 May 2016 - Misspelling in [4] - "past" should be "passed" 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: 18 May 2016

At a glance

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Judgment (20 paragraphs)

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