- Unreported Judgment
- Appeal Determined - Special Leave Refused (HCA)
SUPREME COURT OF QUEENSLAND
Xstrata Coal (Qld) Pty Ltd & Ors v Bowen Shire Council  QSC 371
XSTRATA COAL QUEENSLAND PTY LTD
ACN 098 156 702
ITOCHU COAL RESOURCES AUSTRLALIA PTY LTD
ACN 072 596 733
ICRA NCA PTY LTD
ACN 106 26 584
SUMISHO COAL AUSTRALIA PTY LTD
ACN 061 524 249
COUNCIL OF THE SHIRE OF BOWEN
BS 8239 of 2007
Supreme Court at Brisbane
18 November 2009
18 August 2009
P Lyons J
REAL PROPERTY – RATES AND CHARGES – RATING OF LAND – TYPES OF RATES – DIFFERENTIAL RATES – where the applicants submit that the respondent’s decisions to impose rates are invalid – differential rating categories –consideration of the rating and related provisions of the Local Government Act 1993 (Qld)
ADMINISTRATIVE LAW – JUDICIAL REVIEW – GROUNDS OF REVIEW – IRRELEVANT CONSIDERATIONS – where the applicants contend that the decision of the respondent is based on the consideration of the capacity of landowners to pay rates – where the applicants contend that the decision of the respondent is based on the consideration of the effect of coal mining activities on financial assistance grants – whether these considerations irrelevant – where the respondent’s decisions are held not to be invalid
ADMINISTRATIVE LAW – JUDICIAL REVIEW – GROUNDS OF REVIEW – FAILURE TO TAKE INTO ACCOUNT RELEVANT CONSIDERATIONS – where the applicants contend the respondent failed to take into consideration the budget as required by s 520(3) Local Government Act 1993 (Qld) – where the applicants contend the respondent failed to take into consideration the fact that it was levying rates on freehold land, and mining leases over same land – where the respondent’s decisions are held not to be invalid
ADMINISTRATIVE LAW – JUDICIAL REVIEW – GROUNDS OF REVIEW – UNREASONABLENESS –where the applicants contend that the respondent’s decisions were so unreasonable that no reasonable local government could have made them – whether consideration by the respondent of the financial assistance grant and the use of land were irrational – where the respondent’s decisions are held not to be invalid
ADMINISTRATIVE LAW – JUDICIAL REVIEW – “no evidence” ground – where the applicants submit that the respondent’s decision was not based on evidence, and accordingly, amounts to an error of law – where the applicants submit that relief is therefore available under Parts 3 and 5 of the Judicial Review Act 1991 (Qld) or alternatively, under the common law writ of certiorari – applicable tests - where the applicants have failed to establish a right to either form of relief
Administrative Decisions (Judicial Review) Act 1977 (Cth)
Judicial Review Act 1991 (Qld), s 20, s 24
Local Government Act 1993 (Qld), s 513A, s 513B, s 513C, s 518, s 519, s 520, s 520A, s 957, s 963, s 964, s 965, s 966, s 969, s 971, s 1008
Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321, considered
Australand Land Housing No. 5 (Hope Island) Pty Ltd v Gold Coast City Council  QSC 332, distinguished
Azzopardi v Tasman UEB Industries (1985) 4 NSWLR 139, considered
Falkenberg v City of Hamilton  VR 65, distinguished
Mahon v Air New Zealand Ltd  AC 808, considered
Television Capricornia Pty Ltd v Australian Broadcasting Tribunal  13 FCR 511, cited
Toorak Village Development City Pty Ltd v City of Prahran  VR 858, considered
Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24, applied
W Sofronoff QC SG with S Hooper for the applicants
R Gotterson QC with S Fynes-Clinton for the respondent
Allens Arthur Robinson for the applicants
King & Company solicitors for the respondent
- P LYONS J: For the first six months of the 2008 financial year, Bowen Shire Council (the Council) levied rates on properties associated with mines in the Shire which were significantly greater than in previous years. The applicants paid the rates under protest, and now seek a determination that the action taken by the Council is invalid.
- The properties comprise two coal mines, the Collinsville Mine and the Newlands Mine. There are a number of properties associated with each mine. The properties associated with the Collinsville Mine are referred to as Kerale Road, Scottsville Road and Weir Road. The properties associated with the Newlands Mine are referred to as Nebo Road and Newlands.
- In the later part of 2006 ten local authorities in Central Queensland, including the Council, engaged in a review of the rating of mines in their local government areas. The mines seem to be principally, but not exclusively, coal mines. These Councils commissioned a company, Morton Consulting Services Pty Ltd (Morton Consulting), which had over a number of years advised local governments on a range of matters, and King & Company, a firm of solicitors specialising in local government matters, to prepare a report on this topic.
- On about 19 March 2007, a draft report from Morton Consulting and King & Company was provided to Bowen (the Morton Report). The report was entitled “Central Queensland Councils – Review of Mine Rating”. The report identified as an option that differential rate categories be established for mines.
- Around the middle of 2007, preliminary budget papers were prepared for the Council. They proposed a system of differential rating, and identified proposed categories of land based generally on land use. One of the categories related to coal mining. The papers also proposed a rate of 12.01 cents in the dollar of the unimproved value for coal mining land. The proposed budget was described in the papers as a “balanced budget…(which) if adopted as is, would be a workable budget for the Bowen Shire Council for the ensuing financial year.”
- One source of income for the Council is financial assistance from the Commonwealth, distributed in Queensland by the Local Government Grants Commission. On 28 May 20007 the Council was advised of its “Total Indicative Grant” for the 2008 financial year, the amount being $2,069,552.
- On an unspecified date, computer modelling was carried out for options for rating strategies. After what was referred to as “councillor input”, working papers were produced by Council officers relating to alternative rating strategies for mines. Alternative Strategy 3 considered the following categories for mines: land within a radius of 50km of a major township, and with an unimproved capital value of less than $250,000; land within a radius of 50km of a major township, and with an unimproved capital value between $250,000 and $600,000; land within a radius of 50km of a major township, and with an unimproved capital value between $600, 000 and $1,000,000; land within a radius of 50km of a major township, and with an unimproved capital value between $1,000,000 and $4,000,000; and land outside a radius of 50km of a major township. The rates ultimately adopted were those set out in Alternative Strategy 3.
- On 13 June 2007, a Revenue Policy was adopted by the Council. It stated, in quite general terms, principles relevant to the making of rates and charges.
- On 27 June 2007, a Revenue Statement was adopted by the Council. It proposed a differential rating system broadly similar to that in the preliminary budget, with additional categories of land. It included reasons for this approach.
- The same resolution which adopted the Revenue Statement also adopted the Budget Statement and the Budget. Another resolution passed at the same meeting adopted the rates for each of the categories which have been previously mentioned. The Council also resolved that rates be levied half-yearly. The relevant decisions made at this meeting will be referred to as the Council’s rating decisions.
- On 15 August 2007, the Council issued five notices, one each for Kerale Road, Scottsville Road, Weir Road, Nebo Road and Newlands. They related to the six month period from 1 July to 31 December 2007. On 20 December 2007, a further rates notice, referred to as the Supplementary Nebo Road Rates Notice, was issued in relation to Nebo Road. It was said to be for the period from 1 November 2005 to 31 December 2007. It was in an amount of $5,065. While the application seeks relief in respect of this notice, Mr Sofronoff QC, who appeared with Mr Hooper of Counsel for the applicant, stated that such relief was no longer sought. The rates specified in the other five notices, which remain in issue, amounted to $481,407.
- A discount was allowed for prompt payment. The applicants paid the sum of $437,826.21, which reflected the discount, under protest.
The Morton Report
- Because of the role which it played in the applicants’ submissions, it is necessary to consider this report in greater detail.
- The report was directed to “mine rating”, relating to “major mining activity” (predominantly coal related), as well as associated accommodation. It was prepared for local authority areas “with significant mining activity”.
- The report identified the significance of mining activities in these areas. Thus, the major mines were said to employ over 20,000 persons, which might be compared with the resident population of those areas as recorded in Australian Bureau of Statistics (ABS) figures, at approximately 75,000 persons. In Bowen Shire, the number of persons employed in mines in the 2006 financial year was reported at 1,464, compared with a population in 2005 of 12,546 persons.
- The report stated that all local authorities were, at the time of the report, categorising mines separately, for the purpose of imposing differential rates.
- The report expressed the view that there was very little correlation between the size of a mine in terms of its potential impacts on a local authority area, and the unimproved value of the land on which the mining was conducted. It was therefore considered difficult to rely solely on unimproved values, as a means of spreading the general rate burden “in an equitable manner”. The report also noted that there were significant variations in the number of rateable parcels associated with each mining operation. The report identified the key question raised by this analysis as, “what is a reasonable general rate levy on a major mine?”
- The report recorded that local authorities had suggested that wage costs were greater than they would otherwise be because of high mine incomes, high staff turnover, and housing difficulties both in terms of availability and affordability, as well as the need for additional health, environmental, planning and community development services, resulting from the fact that mining was carried out in these local authority areas. Impacts were not limited to those from the resident population, and were also the consequence of “other visitors to the areas such as contractors servicing machinery and equipment.”
- The report also included the following statement:
“Significant mining activity (and higher personal incomes) results in reduced Financial Assistance Grants because of the assumed additional revenue capacity of the shire (which only exists in reality if a significant rate revenue is applied to mining activity).”
- A footnote to this passage stated that the rating capacity assessment for a local government is adjusted by the ABS Index of Economic Resources “which is significantly above average for Bowen Basin Councils”.
- An analysis was then carried out which compared the rate revenue for local authorities from mining lands, with the rate revenue per employee from businesses across the State. That led to the expression of a view that it would not be unreasonable to expect Central Queensland mines to pay general rates on average of at least $350 to $400 per full-time employee, before any consideration of special rates to fund specific services and facilities. The authors of the report expressed the view that a figure somewhat higher than $400 per full-time employee would also not be unreasonable.
- The report then provided some options for allocating a portion of burden of the general rate revenue to mines in each local authority area. One of the options was to establish one or a number of differential rate categories for coal mining, the most appropriate method being to base categories on the number of persons employed at the mine. This was said to “(relate) directly to the potential impacts of the presence of each mine in the council area”.
- The report included suggested wording for local authority revenue statements. That wording made reference to the impact that coal mines had on the ability of the local authority to deliver “desired levels of service to its community”, and continued:
“These impacts include:-
- The increase in Council’s wage costs in endeavour to compete (in a limited labour market) with high mining incomes;
- Increased staff turnover;
- Accommodation difficulties in terms of both availability and affordability;
- Increased use/more rapid deterioration of public infrastructure;
- The need for additional health, environmental, planning and community development services.”
- The suggested wording then made reference to the increase in the resident population, and the number of visitors, and the reduction of Financial Assistance Grants. The wording also referred to a system of categorisation using mine employment figures, so that mines would be found in a number of categories.
Council meeting 27 June 2007
- It is also necessary to make further reference to the minutes of this meeting.
- It will be recalled that at this meeting, the Council, by resolution, adopted a Revenue Statement. This recorded the Council’s policy of making and charging differential rates. It also included the following (as part of the Revenue Statement):
“Principles used for the making of rates and charges:
The Council is required to raise an amount of revenue it sees as being appropriate to maintain assets and provide services in the Shire as a whole. In deciding how that revenue is raised, the Council is able to take into account the following factors:
- The rateable value of land, including valuation relativities between land, and the rates which would be payable if only one general rate were adopted; and
- The level of services provided to that land and the cost of providing the services compared to the rate burden that would apply under a single general rate; and
- The use of the land in so far as it relates to the extent of utilization of or benefit from Council's services; and
- Location and access to services;
- The application of equity to rating policies to ensure that the rating burden is distributed in a fair manner.
In applying these factors to the particular circumstances of the Shire in terms of economic, demographic and social considerations, the Council has formed the view that there are identifiable classes of these commercial land uses that are of a nature and/or which necessarily requires council to maintain existing infrastructure and services or make provision for new infrastructure and services at a higher level than would otherwise be required if such land uses did not exist.
On this basis the Council is of the opinion that a more effective system of differential general rating will achieve a fairer and more equitable distribution of the rating burden to the extent that it provides a system which:-
- is more able to be adjusted to changing economic circumstances;
- more effectively relates the ratepayers’ ability to pay to the level of benefit received from the expenditure of rates revenue;
- is economical to administer relative to the revenue derived;
- encourages the desire that ratepayers in similar circumstances are treated in a similar manner;
- So far as mining and mining related activities are concerned, Council, in conjunction with a number of other "Bowen Basin" Councils affected by mining (particularly coal mining) and mining related activities has paid particular attention to the need to carefully consider the impacts that these particular land uses are having on the ability of Council to deliver desired levels of service to its community.
These impacts include:-
- The increase in Council's wage costs in endeavour to compete (in a limited labour market) with high mine incomes;
- Increases staff turnover;
- Accommodation difficulties in terms of both availability and affordability;
- Increased use/more rapid deterioration of public infrastructure;
- The need for additional health, environmental, planning and community development services.
In addition, not only do the mines generate the additional full-time equivalent resident population through the mine workforce, they also generate other visitors to the area such as contractors servicing machinery and equipment. Further, significant mining activity (and higher personal incomes) results in reduced Financial Assistance Grants because f (sic) the assumed additional revenue capacity of the Shire (which only exists in reality if a significant rate levy is applied to mining activity). In arriving at the differential rating categories for mining (and mining related activities) Council has also considered the following issues:-
- There is no consistency in the unimproved valuation of the total parcels involved in a mine operation and the size of the operation (and the impact on the Council). This makes it very di8ficult (sic) to rely solely on valuation to spread the general rate burden in an equitable manner. Valuations (for mining, in particular) tend to reflect the primary industry nature of the land holding (eg whether in good cattle country or not) and the historic nature of the subdivision size in the area.
- The number of rateable parcels making up one mining operation varies significantly. In some cases a large mine may have only one rateable assessment while in other cases there may be four or more separate parcels under the one mine operation and associated activity.
Accordingly, mine related accommodation facilities will also be particularly categorized, based on the number of accommodation units provided.
For the purpose of making and levying general rates on all rateable land in the Shire, the Council hereby determines that there shall be twenty (20) categories of land.”
- There then followed 20 identified categories. These were described in the manner previously mentioned. Category 11 was in fact the Newlands Mine. Categories 17, 19 and 20 comprised the Collinsville Mine.
- A separate resolution adopted rates in the dollar of the unimproved value of land for each category. For category 11, the rate was 28.79 cents in the dollar; for category 17 it was 12.01 cents in the dollar; for category 19, 54.38 cents in the dollar; and for category 20, 13.676 cents in the dollar. These rates resulted in the significant increases in general rates for the two mines, previously mentioned.
- It will be apparent from the Revenue Statement that the primary factor which led to the categorisation was the fact that certain classes of commercial land uses required infrastructure and services to be provided at a higher level than would be the case if these uses did not occur within the local authority area. The Council also considered its proposed system more effectively to relate “the ratepayers’ ability to pay” to the level of benefit received from the expenditure of rates revenue. It also took into account the effect the mines were thought to have on the ability of the Council to provide services to the community, including the matters mentioned in the suggested wording provided in the Morton Report. However, the Revenue Statement did not include the statement suggested by the report, that the Council would adopt a system of categorisation using mine employment figures to determine the categories. The evidence indicates that the Council did not follow this approach.
- Before considering the specific grounds relied upon by the applicants, it is necessary to make reference to the statutory provisions regulating the making and levying of rates by the Council. They are found in the Local Government Act 1993 (Qld) (LGA).
Rating and related provisions of LGA
- Under s 513A of the LGA, a local government must, for each financial year, prepare and by resolution, adopt, a revenue policy. Its budget is to be consistent with the policy. Under s 513B, the policy is to comply with the Local Government Finance Standard (Finance Standard). The Finance Standard requires that the policy include details of the policy applied for the making and levying of rates. Under s 513C of the LGA, the revenue policy must be made available to the public.
- Under s 518 of the LGA, a local government is required to adopt, by resolution, for each financial year, a budget for its operating fund and a revenue statement. Subject to an extension of time by the Minister, this must occur between 31 May and 1 September in each year.
- Under s 519 of the LGA, the budget must, amongst other things, comply with the Finance Standard, and be accompanied by the local government’s revenue statement. The Finance Standard contains a number of provisions which appear to be aimed at achieving sound financial management.
- Under s 520, a local government’s budget for its operating fund must specify its estimated total costs, and the costs of each of its significant activities; as well as the sources of funds necessary for spending provided for in the budget. The budget must be the basis upon which rates are to be made and levied for the financial year.
- Under s 520A, a local government’s revenue statement must comply with the Finance Standard. The Finance Standard requires the revenue statement to include an outline and explanation of the rates and charges to be made and levied in the financial year. If the local government makes and levies a differential general rate, s 520A requires the revenue statement to state the categories into which rateable land in the local authority area is to be categorised, and the criteria by which land is to be categorised.
- Under s 957 of the LGA, all land is rateable land, other than specified exceptions, which are not relevant to the present case.
- Under s 963, a local government may, for a financial year, make and levy a number of rates including a differential general rate. A differential rate is by definition a rate made and levied equally on the unimproved value of all rateable land in a local government area included in a category decided by the local government.
- Section 963 also permits a local government to make a general rate, defined to mean a rate made and levied equally on the unimproved value of all rateable land in the local government area.
- Section 963 also permits the making of separate rates and charges, a separate rate being a rate made and levied on the unimproved value of all rateable land in the local authority area, and a separate charge being a charge made and levied equally on all rateable land in that area. The section also permits a local government to make and levy special rates and charges, on land which specially benefits from or where the occupier of the land or the use of the land specially contributes to the need for service, facility or activity.
- Under s 964, a rate mentioned in s 963 may only be made for a financial year by resolution at the local government’s budget meeting for that year. Under s 965, a local government is required to make either a general rate or differential general rates for each financial year.
- The making of a differential general rate is provided for in s 966 as follows:
“(1) Before a differential general rate is made and levied, rateable land must be categorised into 2 or more categories under part 3.
(2) A differential general rate made and levied on rateable land in a category may be the same as or different to the differential general rate made and levied on land in another category.
(3) If a local government makes and levies a differential general rate for rateable land for a financial year, the local government must not make and levy a general rate for the land for the year.
(4) A differential general rate may be made and levied on a lot under a community titles Act as if it were a parcel of rateable land.
(5) To avoid doubt, it is declared that a differential general rate may be made and levied on a lot included in a community titles scheme under the Body Corporate and Community Management Act 1997.”
- It is clear from s 969 that mining tenements are rateable land.
- Under s 1008 of the LGA, a local government may levy a differential general rate only by a rate notice to the person recorded in the local government’s land record as the owner of the land on which the rate is levied.
Capacity of landowner to pay rates
- The applicants submit that the Council’s rating decisions are invalid, as the Council took into consideration the ability of landowners to pay the rates proposed to be levied.
- It does not seem to be in issue and it is apparent from a number of documents, that the Council took this matter into account in making these decisions.
- The applicants’ first submission is that it is apparent from s 520 that the purpose of making and levying rates is to provide funding to meet expenditures proposed in the budget, and accordingly it follows that the capacity of individual landowners to pay rates is an irrelevant consideration.
- In Minister for Aboriginal Affairs v Peko-Wallsend Ltd, Mason J pointed out that where a statute confers a discretion which in terms is unconfined, the factors that may be taken into account for the exercise of the discretion are similarly unconfined, except insofar as there may be found, in the subject-matter, scope and purpose of the statute, some implied limitation on the factors to which the decision-maker may legitimately have regard.
- In the present case, the important decisions, which are linked, were the decision to adopt the Revenue Statement, the decision to adopt the Budget Statement, and the decision to make the differential general rates. Section 518 required the Council to adopt a budget. Section 520 required the budget to specify estimated costs, and the sources of funds. The estimation of costs is inevitably the result of a consideration of anticipated projects and other expenditures for the relevant financial year. However, the identity of the sources of funds is in part the result of a consideration of potential sources of funds other than rates, and in part the result of the proposed exercise of the power to make and levy rates. Section 520(3) requires that the budget be the basis on which rates are to be levied. It is otherwise silent in relation to the decisions to which this application is concerned.
- The fact that rates must be based on the budget has the consequence that in making rates, the Council must give consideration to its anticipated level of expenditure. In my view, that does not give rise to an implied limitation on the matters to which the Council might have regard in deciding whether to adopt a differential rating system, or in identifying the categories of land to which different rates will apply, or in determining the specific rates. In my view, a consideration of s 520 does not by implication preclude the Council from considering the ability of landowners of land in proposed categories to pay rates. Nor does a consideration of the LGA provisions relating to rating lead to such an implication. Nor does that implication arise from a consideration of the subject matter, scope and purpose of these provisions. Taken together, they confer, and are intended to confer, on local governments a range of powers for raising revenue, with broad discretions, and some stated limitations.
- The applicants then submit that it is inconsistent with existing authorities to hold that the Council could take into account the ability of landowners to pay rates. The first decision on which they rely is Australand Land and Housing No. 5 (Hope Island) Pty Ltd v Gold Coast City Council. This is a decision of Chesterman J (as his Honour then was) at first instance. Australand was not concerned with differential rating. Rather, it dealt with a decision by a Council to impose a special charge pursuant to s 971 of the LGA. Of this section, his Honour said:
“The effect of s 971 is that a local authority may impose a special rate or charge only where it forms the reasonable opinion (in the sense just prescribed) that all the land that it proposes to burden with the special rate will benefit from the service, facility or activity provided and it has not excluded from the rate any land which would similarly benefit. There is an exception with respect to land accidentally omitted from the rate.”
- That conclusion followed a consideration of the language of s 971 and other decisions on statutory provisions expressed in similar terms. It is against that background that his Honour held that a decision by that Council to impose a special charge was an improper exercise of the power, because in deciding what land was to be subject to the charge, the Council had taken into account the capacity of the owners of the charged land to pay the special charge. A different criterion for that decision was specified by s 971, with which it would be inconsistent to differentiate between landowners by reference to their capacity to pay the charge.
- In my view, Australand is of no assistance in determining the validity of the decisions which are the subject of the present application, as they were made in the exercise of powers conferred in quite different terms. None of the provisions relevant to the Council’s rating decisions were subject to a limitation like that found in s 971.
- The applicants also rely on the following statement from the judgment of Nathan J in Falkenberg v City of Hamilton:
“The proposition that rates which make some farming operations uneconomic are too high and therefore unfair can be tested by the reverse: that is, if some farming operations are highly profitable the rates must be too low and therefore by being unfair to other ratepayers they should be increased. But the Act dictates the way in which rates are to be levied: that is, to strike a figure which will supply sufficient money for the municipal fund, based on the estimated expenditure needed to fulfil the council’s statutory function. To contend… that rates should be levied on the basis of capacity to pay is not the law. The concept of rates being levied on a ‘profits basis’ is restricted to the valuation which may be given to a particular allotment: Kingston Union v Metropolitan Water Board; R v London & North Western Railway Co.”
- There are significant differences between Falkenberg and the present case. Falkenberg was concerned with provisions of the Local Government Act 1958 (Vic). Section 266 of that Act conferred the power to make and levy general rates. Section 266(4) required a Council in certain circumstances to fix a “farm rate”, at a lesser amount in the dollar than the general rate levied on other land. It also gave the Council a discretion whether or not to fix an “urban farm rate” at a lesser amount in the dollar than the general rate levied in respect of all other rateable land, save farm rate land, and residential use land. A number of parcels owned by Mr Falkenberg were rated as urban farm land, though one parcel was rated as farm land, one as town land, and one was rated under the minimum rate.
- Section 304 of the Act gave a person aggrieved by a rate, the right to appeal to the County Court. Under s 306, “where there appears to be just cause for giving relief” the County Court had the power to amend the rate. Mr Falkenberg had appealed to the County Court, which quashed the urban farm, farm and minimum rates in respect of Mr Falkenberg’s properties, but let the general town rate stand. The Council then asked the Court, pursuant to s 304(3), to state facts by way of a special case for the determination of the Supreme Court. That resulted in a hearing by the Full Court of that Court. Nathan J would have set aside the County Court’s orders quashing the urban farm, farm and minimum rates. However, the other members of the Court confirmed the decision of the County Court. The judgment of Nathan J was therefore a dissenting judgment.
- Murphy J said:
“The statutory purpose in requiring the City of Hamilton to strike a farm rate at a lower rate than the ordinary rate, and in giving it a discretion whether or not to fix an urban farm rate was, in my opinion, to relieve the owners/occupiers of farm land, whether urban or otherwise, from what might otherwise be seen to be an unfair burden requiring an occupier of such classes of land to pay unfairly exorbitant rates. Accordingly, the statutory requirement is that a farm rate and an urban farm rate shall be struck at a level below that of the ordinary general rate, irrespective of the valuation placed on the rateable property.”
- His Honour also referred to early authority which held that an appeal against the differential in rates between properties might be grounded on alleged unfairness.
- Likewise, Fullagar J considered that a farm rate and an urban farm rate should be set by reference to “general considerations as to what is just and equitable.”
- In my view, the approaches taken by the Justices who constituted the majority is inconsistent with the passage quoted from the decision of Nathan J set out earlier. In any event, the different language used in the Victorian Act makes this case an unlikely source for identifying implications to be drawn from the language used in the LGA.
- The applicants then submit that a consideration of the ability of ratepayers to pay rates when making decisions to impose differential rates is inconsistent with notions of fairness and equality emphasised in Falkenberg. An argument in support of the proposition that such a consideration is rendered irrelevant as a result of the construction of the LGA, carries with it the proposition that the LGA by implication prohibits taking a matter into account unless to do so is consistent with notions of fairness and equality. In Falkenberg, the majority’s views about such notions relate back to the requirement that the farm rate be set at a lower rate than the other rates, which suggests that it might otherwise be seen to be an unfair burden on those who occupy farm lands if they are subjected to the same rate as those who occupy other lands; and the statutory provision creating the right to appeal to the County Court, whose power is dependent upon there being “just cause for giving relief.” The case does not provide any real basis for the submission.
- However, both their Honours referred to an earlier decision of the Full Court, Toorak Village Development City Pty Ltd v City of Prahran. That case was concerned with a different power to impose rates, which enabled differential assessments. No criterion was identified for differentiating between one property and another. The Court obviously considered that the power was not to be exercised arbitrarily; rather, differentiation was to be based on “general considerations of what is just and equitable.”
- It is not easy to characterise this decision consistently with the approach taken in Peko-Wallsend. It is not clear whether the Court considered that general considerations as to what is just and equitable were the only relevant considerations for a Council imposing a differential rate; or whether the Council was prohibited from considering any matter which did not accord with such considerations; or whether the Court was formulating some other test for lawfulness, not dependent upon whether considerations were relevant or irrelevant. The views of the Court may well have been influenced by s 304, previously referred to. The issue which was being decided was whether a certain ground of appeal could be advanced, and in doing so, Smith J noted that the grounds did not involve any denial that the rate was duly made.
- However, even if general notions of what is just and equitable determine what considerations are relevant in imposing differential rates under the LGA, or are decisive of the validity of those rates, it does not follow that the decisions made by the Council in the present case are invalid. No general principle has been established that considerations of what is just and equitable prevent an entity imposing a statutory charge from taking into account capacity to pay. The Council’s submissions point out that the system of income taxation in this country involves progressive rates, both the total tax payable and rates increasing as a taxpayer’s income increases. The Council’s submissions also point out that in the general rating system under the LGA, rates are imposed by reference to the unimproved value of rateable land. Thus rates are imposed by reference to a measure which, at least to some extent, is reflective of the assets owned by a ratepayer. The Council’s submissions also point out that in Falkenberg, Murphy J considered that the relative earning potential of classes of land might be taken into account in dealing with issues of fairness in the imposition of a rate; and that that in turn is related to an ability to pay.
- General considerations as to what is just and equitable do not provide a very firm or clear criterion for determining what considerations are relevant or irrelevant to the exercise of statutory rating powers. It may be that if such considerations are relevant to the validity of a decision to impose rates, as distinct from a proper ground of appeal under the Victorian legislation, they are relevant because a decision which offends against them is arbitrary, capricious or irrational. In my view, they do not otherwise provide a meaningful criterion for determining whether a consideration is irrelevant to a decision to impose differential general rates. In any event, I am of the opinion that the consideration of a ratepayer’s ability to pay rates is not precluded by reference to a consideration of what is fair and equitable.
- The applicants also contend that under the LGA, a person’s capacity to pay rates is consigned to the stage at which payment is to be enforced. They rely on Chapter 14, Part 6 of the LGA, which expressly authorises a local government to grant concessions to landowners with a limited capacity to pay rates, or to whom the payment of rates causes hardship. In my view, the conferral of a specific power to grant relief from enforcement in individual cases does not give rise to an implication that the capacity to pay a rate is irrelevant to a decision to impose the rate.
- It was orally submitted on behalf of the applicants that the decision to impose the rates on coal mining land on the basis of the applicants’ capacity to pay was capricious and arbitrary. Examples were offered in support of its submissions. One analogy was with the imposition of relatively high rates on a wealthy owner of a remote parcel of land which imposed little burden on the Council. Another was with the imposition of a high level of rates on land owned by members of a particular profession.
- In my view, it is not inevitable that a decision to impose a greater proportion of the rates burden on more wealthy landowners simply because of their greater capacity to pay is capricious or arbitrary. As has been mentioned, such an approach is implicit in a progressive tax system; and it is not entirely unrelated to the general rating system under the LGA, where rates are frequently imposed by reference to the unimproved value of land, irrespective of the demand which results from the use or occupation of that land on services provided by the local government. A decision to impose a greater proportion of the rates burden on some, but not all, wealthy landowners, where there is no rational basis for distinguishing amongst such owners, may well be arbitrary or capricious, but the applicants did not advance such a case.
- The submissions, and the examples, do not come to grips fully with the decision made by the Council. In essence, the Council considered that coal mining activities resulted in the imposition of higher financial burdens on the Council in performing its functions; that the presence of coal mines in its local government area reduced the amount of financial assistance received below what it otherwise would be (a matter discussed later in these reasons); and that the persons who own land on which coal mining is carried out are likely to have the capacity to pay the proposed rates. The decisions in the examples are significantly different from the decisions in the present case.
- It was also submitted that there was a “lack of rational connection between the land upon which the charges are levied and the budget.” This was contrasted with the report, which related the level of rating to a measure of the level of mining activity. In my view, such a connection is not required by the provisions of the LGA. No criteria are prescribed for determining the different categories of land when a differential rating system is adopted; nor are there criteria for determining the revenue to be raised from each category. In particular, there is nothing in the legislation which expressly requires that there be a connection between the revenue raised from each category of land, and the demand which that land imposes on local government services. On the contrary, the LGA provides other mechanisms for recovering revenue by reference to the level of service provided; and one revenue raising mechanism of long standing, the general rate, would prevent any consideration of differing impacts on levels of service associated with various classes of land in the local government’s area. In my view, these considerations have the consequence that there is no implied requirement that there be a connection between the land upon which the charge is levied, and the budget; or between that land and the requirements for, or costs of, the provision of local government services.
- The applicants have also submitted that while it might have been lawful for the Council to take into account the capacity of the land to generate income, but that is to be distinguished from the ability of the owners of the land to pay rates; and that in the present case, the Council has taken the latter into account. For reasons already stated, I do not consider that this is an irrelevant consideration, which would vitiate its decisions.
- In my view, the Council’s rating decisions are not invalid by reason of the fact that it took into account the capacity of landowners to pay rates.
Financial assistance grant
- Mention has already been made of the references to this matter in the Council minutes. The applicants submit that it was an irrelevant consideration.
- It has not been submitted on behalf of the Council that the Council did not take this matter into account.
- The applicants submit that reference to the effect on the Financial Assistance Grant introduced into the decision-making process, a consideration which is external to the matters the Council was entitled to consider under the LGA. One related argument is that to do so, and to use this as a justification for imposing a higher rate on coal mining land, is inconsistent with notions of fairness and equality which are said to underlie differential general rating.
- The applicants’ submissions do not specifically identify provisions of the LGA which are relied upon for that submission. The effect of the LGA is that the same amount in the dollar of unimproved value is to be applied to all land within a particular category. However the LGA does not otherwise require any equality in differential rating. In particular, it does not identify specific criteria for the differentiation of categories of land in a local government area.
- It follows, in my opinion, that a consideration of the extent to which the LGA requires some form of equality in relation to the imposition of a rates burden does not warrant a conclusion that this consideration may not be taken into account.
- For reasons discussed elsewhere, I do not consider that fairness provides a limitation on the matters that might be taken into account by a local government in making decisions relating to differential rating, unless the decisions are arbitrary and capricious.
- In any event it does not seem to me to be correct to say that it is inconsistent with general notions of fairness, to impose rates under a differential rating system, so that land on which a particular activity is carried out is subject to a higher level of rates, when those activities have the consequence that the Federal Assistance Grant is less than would otherwise be the case.
- It will be recalled that the preliminary budget papers proposed a rate of 12.01 cents in the dollar of the unimproved value of coal mining land. That would have resulted in rates from such land in the sum of $495,092. The preliminary budget papers stated that a budget including that rate would be “a workable budget.”
- The amount levied from coal mining land as a result of the rates adopted by the Council in June 2007 was projected to be $1,250,664.28. On this basis, the applicants submit that the Council has failed to take into account the budget, something that it is required to do by s 520(3) of the LGA.
- There are a number of difficulties with this submission. The first is that it fails to recognise that the budget changed from that referred to in the preliminary budget papers; and no attempt is made to show that the budget adopted by the Council was not related to the rates which it decided to make. In particular, no attempt was made to identify movements in projected expenditure, or in rates for other categories of land, as between those shown in the preliminary budget paper, and those in the final budget. It is difficult to draw any relevant conclusion about the increase in the rates on coal mining land, without doing this exercise.
- The second difficulty is that s 520(3) simply requires that the budget be the basis for the rates made and levied by the Council. It does not require precise equality between anticipated expenditure and total revenue. In the preliminary budget papers, differential rating was projected to generate some $9,575,000. There was evidence that the Council’s budgeted operating expenditure for the year exceeded $23,500,000. There was a budgeted operating deficit of a little over $190,000. Budgeted total expenditure approached $49,000,000. The rates to be levied from coal mines, as adopted, were greater than those in the preliminary budget papers by an amount of $750,000 approximately. Against the background of the other figures mentioned, it is difficult to establish that the rates were not made on the basis of the budget.
- Finally, the resolution of the Council on the 27 June 2007 records that general rates were to provide the net funding requirement of the Council’s general purpose programs, as stated in the detailed estimates of income and expenditure; and the net funding requirement was the amount required after deducting specific purpose revenues and other general purpose revenues. It also stated that the Council was required to raise an amount of revenue it sees as being appropriate to maintain assets and provide services in the Shire as a whole. The latter statement was one on which, it would appear from the resolution, the Council acted in deciding to adopt differential rates. Neither of these statements has been shown to be wrong.
- In my opinion, the applicants have failed to establish that the Council failed to take into account the budget, in making its rating decisions.
Levying rates on both mining leases and related freehold
- For both the Collinsville Mine and the Newlands Mine, rates were levied against the mining leases, and the freehold lots which were subject to those leases. It was said that this was a relevant consideration, not taken into account by the Council. The consequence apparently to be implied, is that for this reason, the rating decisions were invalid.
- I have previously referred to working papers which included Alternative Strategy 3. The document which contains this strategy records not only the proposed rates for each of the categories which included coal mining lands, but also the unimproved values of those lands, and the rates expected to be generated from them; together with the totals for the mines. The total for both mines was $962,816.52. The rates levied for the half-year on the two mines, $481,407, are approximately half of the total projected for the Collinsville Mine and the Newlands Mine for the year, in Alternative Strategy 3. On the assumption that both mining leases and related freehold were included in the calculations, it would seem that the Council proceeded on the basis that the rates would be imposed on both mining leases and related freehold; and that it intended to do so.
- The Council’s submissions point out that under s 984 of the LGA, the applicants could have objected to the inclusion of the mining leases, or the related freehold, or both, in the categories adopted. They did not do so. In the absence of such an objection, it is to be accepted that the categorisation is lawful. The consequence was that each of the mining leases, and each of the parcels of related freehold land, was, if the Council resolved to make and levy differential general rates, to be the subject of a levy. That was a consequence of choosing one of the two options for which s 965 of the LGA provides, when read with the definition of a differential general rate.
- In my view, that submission is correct. The decision to make and levy differential general rates had the consequence that all rateable land included in a category had to be the subject of the rate. In the present case, that included mining leases and freehold land.
- However, that is not a complete answer to the applicants’ submissions. If the Council were required to take into account, when determining categories or making a rate, that both mining leases and related freehold would be the subject of the rate, and it failed to do so, the decision might well be invalid.
- However, nothing has been identified which demonstrates that this was a matter that Council was bound to take into account in making these decisions. As has previously been mentioned, save for the requirement that the rate be levied on all rateable land on each category and the requirement that all rateable land be categorised, the discretion is unfettered. I can see no basis for implying a requirement to take into account the fact that as a result, a rate may be imposed both on a mining lease, and on related freehold land.
- In any event, the evidence does not establish that the Council was not conscious of this at the time of its decision. It seems to have proceeded on the basis that all rateable land (including both mining leases and freehold land) was to be included in the categories for coal mining lands, and subject to the rate.
- For these reasons, this ground is not made out.
- There are a number of matters which the applicants rely upon in support of their submission that the Council’s rating decisions were so unreasonable that no reasonable local government could have made them. It is convenient first to deal with the submissions relating to the impacts of mining activates on the distribution of the Financial Assistance Grant.
- It will be recalled that the minute adopting the Revenue Statement stated (amongst other matters) that significant mining activity and higher personal incomes had the effect of reducing Financial Assistance Grants because of the assumed additional revenue capacity of the Council (said only to exist in reality if a significant rate levy is applied to mining activity). Of this it was submitted that there was no proper basis for it; that it was incorrect; and that there was no logic in the contention. It was also submitted that the existence of mining activities in the local government area, and the incomes earned by mine employees, were irrelevant to the determination of the amount of funds to be distributed to the Council from the Financial Assistance Grant. It was also submitted that no attempt was made to identify how mining operations might have influenced the amount of funds to be distributed.
- The method by which allocations were made from the fund for the 2007-2008 financial year was identified in the Queensland Local Government Grants Commission’s report for 2007. The grant has two components: the Fiscal Equalisation (General Purpose) Grant (General Purpose Grant); and the Identified Road Grant (Road Grant). The General Purpose Grant was said to be allocated on the Horizontal Fiscal Equalisation principle. Its intention is to enable local governments to function at an average standard for the State. A factor taken into account is the capacity of local governments to raise revenue. A related principle is Effort Neutrality. The effect of that principle is said to be that policies of individual local governments relating to raising revenue would not affect the allocation of grant funds. Rather, State averages are used. The policy also takes into account the Index of Economic Resources, produced by the ABS. This index was based on 2001 census data. It should also be noted that in assessing a local government’s capacity to raise revenue, a 30% weighting was said to be attributed to the minimum rate (assumed to be $400 for 2007-2008) applied to all rateable properties in the local authority area; and a 70% weighting was said to be attributed to unimproved values for rateable properties. It was then submitted that the use of some land for mining was irrelevant in this determination. By implication, the submissions suggest that the Council was therefore acting illogically by acting on a view that mining operations reduced the amount of the grant. However, it is apparent that the unimproved value of land is taken into account in assessing revenue capacity. It is by no means irrational to think that the presence of significant coal mines in the local government area has no effect on unimproved values. The mining leases themselves, which are rated, would appear to be taken into account in determining a local government’s capacity to raise revenue. Moreover, if it be true to say that mines generate economic activity, provide higher incomes, and attract a greater resident population which increases a demand for urban land, then it is difficult to see that it is irrational to say that the presence of significant mining activity has affected the assessment of the capacity of the Council to raise revenue, for the purpose of determining what amount is to be distributed by way of the Financial Assistance Grant.
- In the applicants’ oral submission reference was made to the passage in the Morton Report upon which the statement in the minutes appears to be based. A footnote to the report makes reference to the index. It is not clear from the minute that reliance was in fact placed on the index in the Council’s decision, as the footnote was not reproduced in the minute.
- I note at this point that Mr Finlay, who had been the Chief Executive Officer of the Council in 2007, provided an affidavit in which he states that the Council had “reference to and relied upon the statements of fact and opinion set out and the rating strategies proposed” in the Morton Report, for the purpose of formulating rating strategies for the 2007-2008 financial year. There are some difficulties with taking Mr Finlay’s evidence literally. The Council did not in fact adopt the approach recommended in the report. Moreover, the evidence is in the nature of a conclusion which I do not consider Mr Finlay is able to draw. I consider it to be likely that the Council was familiar with what was found in the report. The minutes demonstrate that much was adopted from the report, but, as I have indicated, that is not true of everything in the report.
- Notwithstanding that, it may well have been the case that the reference in the report to the index was of some influence, and that the Council did not act solely on the matter identified in the Revenue Statement, which was the effect of mining activity on assumed revenue capacity. It was submitted on behalf of the applicants that in that event, the Council hade acted illogically because the report recorded that the index for the local governments concerned was “significantly above average”; whereas in truth the index for Bowen Shire was below average.
- It is necessary to focus on what the Council was considering. It was considering the effect of mining activities on the Financial Assistance Grant. The conclusion which was adopted was that this was reduced, as a result of mining activity. It would appear that the index is affected by personal incomes of residents of the local authority area. It is in my view not irrational to conclude that the presence of residents with higher incomes did not affect the amount allocated to Bowen by way of Financial Assistance Grant. It is not irrational to think but for the mining activity and associated higher incomes, the index would have been lower then in fact it was, resulting in the receipt of more funds by way of Financial Assistance Grant. There is, however, no reason to think that the Council was influenced by the statement in the footnote that the index for the local governments concerned was significantly above average.
- It was also submitted that the rating decisions were irrational, because the index was based on 2001 census data. To make that submission out, it would be necessary to demonstrate that the effect of mining activities in 2001 was significantly different to its effect in 2007. That was not done.
- It was also submitted that because the index in each year was based on the census data, its effect did not change from the 2006-2007 financial year to the 2007-2008 financial year, and accordingly it would be irrational for the Council to increase rates on coal mining lands by reference to that factor. In my view, that does not establish that the Council acted irrationally. A fact may exist for a number of years before the Council’s attention is drawn to it and it acts on it. That does not mean that it is irrational in doing so.
- It was also submitted that by the time the Council resolved to adopt the budget, it knew what its grant was, and that it had not been reduced; and accordingly, it was acting illogically. Because the matter likely to have been of interest to the Council was the difference between what the grant actually was, and what it would have been but for the presence of the mines, knowledge of the amount of the grant does not show that the decision was irrational.
- It is also submitted on behalf of the applicants that the Morton Report was the only document available to the Council for the purpose of its rating decision which in any way related coal mining activities to the Council’s activities, and that it did not provide a rational basis for the rating decisions. It was said that the report was silent about the impact of the applicant’s activities on the Council; and about the level of benefits derived by the applicants from local government services. The report said nothing about whether circumstances had changed since the previous financial year, let alone in a way which would justify the increase adopted by the Council. Further, the submissions point out that the report recommended a differential rate for coal mines, based on the number of employees of each mine. The Council did not adopt that recommendation. In the case of the Collinsville mine, the rate adopted per employee in fact approached a figure four times the figure per employee recommended by the report. Further, the report had stated that the question of what is a reasonable rate to levy was dependent on “the specific locational situation and the potential impact on the local community and on Council costs,”; matters not addressed for the applicants’ mines by the report or otherwise. Further, for the Newlands Mine the rate adopted was equivalent to $463 per employee; but Newlands was serviced by a town in the neighbouring shire which would have consequences for the extent to which it led to expenditure on local government services.
- The respondent draws attention to a further report of Mr Morton which became exhibit 4. It includes a table which analyses both general and special rates charged to coal mining lands, showing that on average they equate to $937 per employee, with the highest being $1813 per employee and the lowest being $159 (Bowen). These figures were for the 2006-2007 financial year. It was also submitted that no special charges were levied on the applicants, so that the levy against them proposed for 2007-2008 equated in total to a figure of $829 per employee, which is not inconsistent with the total rate charged for coal mining lands in other local authority areas. Exhibit 4 records that no special charges were imposed on the coal mines in the 2006- 2007 financial year. There has been no attempt to demonstrate that this changed in the following year.
- In my view, in the context of what has occurred in the previous years in other nearby local authority areas, the rates adopted do not appear to be significantly out of line. The applicants’ submissions draw attention to the fact that for Collinsville, the rates equated to $1509 per employee; but that is less than the total of general and special rates charged in Broadsound in the previous year, and not a lot greater than the total for Peak Downs. There are other matters which emerged from Exhibit 4. The total charged in Bowen Shire, at a rate per employee, in 2006-2007 was $159; by a significant extent the lowest for all of the local governments, and by a very significant extent, below the average. It seems to me these matters make it even more difficult to conclude that the Council’s rating decisions for 2007-2008 were irrational, by reason of their size, or by relation to figures referred to in the report.
- Otherwise, the applicants’ submissions seem to amount to an assertion that the Council could not rationally charge the rates adopted without more cogent evidence relating the increased rates to expenditure on local government services, associated with coal mines. In my view, that approach is not correct. The legislation gives the Council a broad discretion. The absence of such evidence does not render the decision irrational.
- A number of other matters were relied upon in support of the submission that the rating decisions were irrational.
- The first of these was that, because coal mining activities resulted in an increase in population, and resulted in increased activity in businesses other than coal mining (for example, by the provision of workers’ accommodation) there was as a consequence of coal mining, an increase in rate revenue in any event; and that while these activities might increase the burden on local government services, they also increased the revenue base. This was said to be relevant to the question whether the Council’s rating decisions were irrational.
- Reference was also made to the extent of the increase, and to the fact that for one category of land the rate was 54.38 cents in the dollar of unimproved value. In this context, reference was made to Falkenberg, for the proposition that it is “necessary to have regard to what is just and fair in all the circumstances.” Reference was also made to the reliance on capacity to pay, and it was submitted that, if relevant, the Council attached too much importance to it.
- In my view, none of these matters establishes that the Council’s rating decisions were irrational.
The “no evidence issue”
- The applicants submit that Council’s decision was based on matters referred to in the Revenue Statement, and in particular on statements relating to the impacts of mining operations on the cost of the provision of local government services. They submit that the only evidence or other material available to the Council in relation to those matters was the Morton Report, which itself was pure assertion and did not refer to any evidence. Accordingly, they submit that the Council’s decision involved an error of law, because it was made on the basis of facts which were not based on any evidence or other supporting material. They submit that relief is available under both Part 3 and Part 5 of the Judicial Review Act 1991 (Qld) (JR Act), thereby submitting that they are entitled either to a statutory order for review, or a prerogative order in the nature of certiorari.
- The statutory basis for a statutory order of review is found in the following provisions of the JR Act:
“20 Application for review of decision
- A person who is aggrieved by a decision to which this Act applies may apply to the court for a statutory order of review in relation to the decision.
- The application may be made on any 1 or more of the following grounds –
(h) that there was no evidence or other material to justify the making of the decision;
24 Decisions without justification—establishing ground (ss 20(2)(h) and 21(2)(h))
The ground mentioned in sections 20(2)(h) and 21(2)(h) is not to be taken to be made out –
(i) the person who made, or proposed to make, the decision was required by law to reach the decision only if a particular matter was or is established; and
(ii) there was no evidence or other material (including facts of which the person was or is entitled to take notice) from which the person could or can reasonably be satisfied that the matter was or is established; or
(i)the person who made, or proposes to make, the decision based, or proposes to base, the decision on the existence of a particular fact; and
(ii) the fact did not or does not exist.”
- There has been no suggestion on behalf of the Council that its rating decisions were not decisions in respect of which relief is potentially available under s 20 of the JR Act.
- It will be apparent that s 24 limits the circumstances in which a statutory order of review may be granted on the ground set out in s 20(2)(h). It does so in different ways, depending upon the statutory provision under which the decision was made.
- In the present case, the LGA provisions relating to the making and levying of rates do not require a particular matter to be established. Accordingly s 24(a) does not apply.
- Under s 24(b), it is necessary to consider whether the rating decisions were based on the existence of a particular fact. If that is so, it is then necessary to consider whether the applicants have established that the fact did not (or does not) exist.
- Of the equivalent provision of the Administrative Decisions (Judicial Review) Act 1977 (Cth) (ADJR Act) it has been said that its most striking aspect is its restrictive nature. It requires the proof of a negative: relief is available on this ground only in a case where the applicant for review can actually negative the fact on which the decision was based. Further, the fact, the non-existence of which must be proven, must be the basis for the decision; that is to say, it must be critical to the making of the decision.
- The applicants’ submissions do not seek to demonstrate that any of the facts in the Revenue Statement form the basis of the decision. The Council’s submissions, however, seem to accept that some at least of these facts were critical.
- However, the applicants’ submissions do not set out to prove that any of the facts in the Revenue Statement “did not … exist”. As is submitted on behalf of the Council, the applicants have not set out to show that any of those facts is objectively untrue; nor have they directly attacked those facts in any evidentiary material.
- In my view, the applicants have failed to establish a right to a statutory order of review of the ground found in s 20(2)(h) of the JR Act.
- Different bases have been identified for the availability of prerogative relief at common law. It has been said that it constitutes an independent ground for such relief. Another basis is that it is an aspect of natural justice, which requires that a decision be based on evidence, in the sense that “it must be based upon material which tends logically to show the existence or non-existence of facts relevant to the issue to be determined, or to show the likelihood or unlikelihood of the occurrence of some future event the occurrence of which would be relevant”. Another basis for prerogative relief on this ground is that it is an error of law to make findings for which there is no evidence.
- In fact, the ground is more accurately stated as that there is no evidence or other material to justify the finding. As was pointed out in Mahon v Air New Zealand Ltd, the technical rules of evidence form no part of the rules of natural justice. It may be doubted that the requirements of natural justice form the basis of a challenge to the validity of a decision of a local government to make and levy a rate. It is, however, unlikely that the approach identified in Mahon would not apply to any basis on which prerogative relief might be granted on the no evidence ground.
- An additional difficulty arises in that context. Unlike a number of the cases in which the issue has arisen, there is no requirement of a hearing or investigation; the legislation simply calls for the exercise of a discretionary power by an elected body. It may be doubted whether evidence is required for the formation of views by members of a local government, which leads to a decision to make a levy rates.
- In Mahon, the test (based on the first rule of natural justice) was formulated in the following terms:
“What is required by the first rule is that the decision to make the finding must be based upon some material that tends logically to show the existence of facts consistent with the finding and that the reasoning supportive of the finding, if it be disclosed, is not logically self-contradictory.”
- If this is the standard to be applied in determining whether prerogative relief should be granted on the grounds of absence of evidence or other material, in my view it is not made out in the present case. The Council, along with a number of other Councils, commissioned the authors of the Morton Report to consider matters relating to rating land where coal mining activities are carried out. They did so, and provided a report. In my view, that report is material which supports the facts identified in the Revenue Statement.
- It may be doubted whether, in Australia, the standard is so high. On one reading of the judgment of Mason CJ in Australian Broadcasting Tribunal v Bond, his Honour considered that neither Mahon nor Moore had not been accepted by the High Court. The difficulty in establishing error of law on the basis of absence of evidence is apparent from the judgment of Glass JA in Azzopardi v Tasman UEB Industries. On whatever basis it might be said that the ground is an available ground for prerogative relief, it is unlikely that the test would differ. Of this ground, Aronson writes that, “the ‘no evidence’ ground cuts out when even a skerrick of evidence appears. Perverse results for which there was some evidence do not amount to errors of law.”
- In my view, the applicants do not establish that they are entitled to prerogative relief on this ground.
- In my view, the applicants have not shown that the Council’s rating decisions are invalid. The application should be dismissed.
 See Schedule 2 of the LGA.
 In Schedule 2 of the LGA.
 See the definitions in Schedule 2 of the LGA.
 See s 971 of the LGA.
Including the Revenue Policy which appears in the minutes of the Council’s meeting of 13 June 2007, the Revenue Statement; and reports relating to the Revenue Statement.
(1986) 162 CLR 24 at 39-42.
  QSC 332.
 At .
 See .
  VR 65, 110.
  AC 331.
 (1874) LR 9 QB 134, at p 144 per Blackburn J.
 At page 74.
 Pages 77-78.
 Page 90.
 Page 74, per Murphy J.
 Page 84, per Fullagar J.
  VR 858.
 The case was discussed in Falkenberg at 77 and 89.
 Toorak Village at 859.
 See the definition of “general rate” and “differential general rate” in schedule 2 of the LGA; s 963 of the LGA.
 Page 73.
 See Trial Bundle Volume 2 page 298.
 Found in Schedule 2 of the LGA.
 See s 976 of the LGA.
 Television Capricornia Pty Ltd v Australian Broadcasting Tribunal (1986) 13 FCR 511, 519.
 Minister for Immigration and Multicultural Affairs v Rajamanikkam (2002) 210 CLR 222 at  per Gleeson CJ.
 Curragh Queensland Mining Ltd v Daniel  34 FCR 212, 220-221.
 See the discussion in Television Capricornia at 514.
 R v Deputy Industrial Injuries Commissioner; ex parte Moore  1 QB 456, 488, adopted by Deane J in Minister for Immigration and Ethnic Affairs v Pochi (1980) 44 FLR 41, 66-68. Both cases are referred to in Television Capricornia at 514.
 See Aronson, Dyer and Groves Judicial Review of Administrative Action (4th ed.) p 208 at [4.105].
  AC 808, 821; cited in Television Capricornia at 514.
 Page 821.
 (1990) 170 CLR 321, 356-357.
 (1985) 4 NSWLR 139, 155-156, discussed in Aronson at 208-210.
 Page 259; cited in Australian Retailers Association v Reserve Bank of Australia  FCA 1707 at .
- Published Case Name:
Xstrata Coal (Qld) Pty Ltd & Ors v Bowen Shire Council
- Shortened Case Name:
Xstrata Coal (Qld) Pty Ltd v Bowen Shire Council
 QSC 371
P Lyons J
18 Nov 2009
|Event||Citation or File||Date||Notes|
|Primary Judgment|| QSC 371||18 Nov 2009||-|
|Appeal Determined (QCA)|| QCA 170||02 Jul 2010||-|
|Special Leave Refused|| HCATrans 294||12 Nov 2010||-|