FEDERAL COURT OF AUSTRALIA Carroll v Clarence Valley Shire Council [2012] FCA 1143 Citation: Carroll v Clarence Valley Shire Council [2012] FCA 1143 Parties: LORRAINE CARROLL, D WERNER, B PAINE, A PAINE, C PAINE, H PAINE, J DUFFICY, N DUFFICY, S EVERSON and SJ EVERSON v CLARENCE VALLEY SHIRE COUNCIL File number: NSD 1102 of 2012 Judge: EMMETT J Date of judgment: 7 September 2012 Legislation: Constitution s 109 Corporations Act 2001 (Cth) s 57A Local Government Act 1993 (NSW) s 220(2) Real Property Act 1900 (Cth) Roads Act 1993 (NSW) Date of hearing: 7 September 2012 Place: Sydney Division: GENERAL DIVISION Category: No catchwords Number of paragraphs: 10 For the plaintiffs: L Carroll Counsel for the defendant: G Dilworth Solicitor for the defendant: Burridge, Harris & Flynn IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 1102 of 2012 BETWEEN: LORRAINE CARROLL Plaintiff AND: CLARENCE VALLEY SHIRE COUNCIL Defendant JUDGE: EMMETT J DATE OF ORDER: 7 SEPTEMBER 2012 WHERE MADE: SYDNEY THE COURT ORDERS THAT: 1. The proceeding be dismissed. 2. The plaintiffs pay the defendant's costs. 3. Orders 1 and 2 be stayed until 9 November 2012. 4. The matter be listed for further directions at 9:30am on Friday, 9 November 2012. 5. The defendant file and serve its submissions as to whether the defendant is a corporation no later than 28 September 2012. 6. The plaintiffs file and serve any submissions in response no later than 19 October 2012. 7. The defendant file any submissions in reply no later than 2 November 2012. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011 IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 1102 of 2012 BETWEEN: LORRAINE CARROLL Plaintiff AND: CLARENCE VALLEY SHIRE COUNCIL Defendant JUDGE: EMMETT J DATE: 7 SEPTEMBER 2012 PLACE: SYDNEY REASONS FOR JUDGMENT 1 In this proceeding Ms Lorraine Carroll, on her own behalf and on behalf of others (together the Landowners), seeks, amongst other things, declarations that Clarence Valley Council (the Council) is not entitled to keep certain lands consisting of the former river frontages of various parcels of land owned by the Landowners. The originating application is supported by a statement of claim. The Council has moved, by interlocutory application, for summary dismissal of the proceeding or, alternatively, for its transfer to the Supreme Court of New South Wales. 2 The only basis upon which the proceeding could be within the jurisdiction of the Federal Court is that claims are made that the Council is a corporation within the meaning of the Corporations Act 2001 (Cth) (the Corporations Act), and that conduct on the part of the Council has in some way contravened the provisions of the Corporations Act. The Council says that the Court has no jurisdiction in relation to the claims, that the claims are doomed to failure, and that, if there is, at least, an arguable case, the proceeding should be transferred to the Supreme Court. 3 It is not entirely clear to me what the basis of the substantive claim is. It seems to centre upon an assertion by Ms Carroll that the Council in some way unlawfully altered the boundaries of the Landowners' lands in relation to the Clarence River. When the grants were originally made, prior to the commencement of the Real Property Act 1900 (NSW) (the Real Property Act), it may be that the grant demonstrated a boundary consisting of the high watermark of the Clarence River. At some stage a road was reserved, which appeared to run close to the bank of the Clarence River. The precise status of the road is not entirely clear to me at present, although, if it is a public road, I would understand that the fee simple in the road would be vested in the local council under the Local Government Act 1993 (NSW) or the Roads Act 1993 (NSW). 4 In any event, the thrust of Ms Carroll's complaint appears to be that, in 2006, in some way, the boundaries of the parcels of land held by the Landowners were altered in order to remove the entire river frontages of their parcels, effectively changing the ownership to the Council. The complaint is that the alteration was surreptitious, that the Council failed to provide reasons or details for the change in ownership, and that the Council made the changes for financial benefit. There are allegations that the Council "stamped the titles" with an official stamp, in circumstances where the wording on the stamp was misleading. 5 I have considerable difficulty, as I have said, with the allegations in the statement of claim. I consider that the statement of claim should be struck out on the basis that it does not disclose an arguable cause of action. Specifically, for example, in relation to one of the parcels of land, there is an express exclusion from the Crown grant and an express exclusion shown in the current register, kept under the Real Property Act, of the roadway in question. It is by no means clear from the pleading whether or not the complaint relates to land consisting of the road or the land on the river side of the road. 6 Unless those sorts of matters are clarified, the statement of claim is bordering on the incomprehensible. That is not meant to be unduly critical of the author. Ms Carroll is not legally represented. Nevertheless, that is not an excuse for failing to comply with the requirement to explain why a claim is made and the basis upon which it is made. On the basis of the material to which I have been taken today, I consider that the proceeding is unlikely to succeed in the claim which is presently formulated. That is not to say, however, that there may not be some claim, either against the Council or some other authority of the State of New South Wales, based on propositions that are not clearly elaborated or stated in the statement of claim. 7 More specifically, however, the only basis upon which it is said that the Federal Court has jurisdiction in relation to the claims is that the Council is a corporation within the meaning of the Corporations Act. Under s 57A of the Corporations Act, a corporation includes a company, any body corporate and an unincorporated body that, under the law of its place of origin, may sue or be sued or may hold property. However, under s 57A(2), an exempt public authority is not a corporation. 8 The Council is constituted under the Local Government Act 1993 (NSW). Section 220(2) of that Act provides that a Council is not a body corporate. That, however, cannot be decisive in relation to the operation of the Corporations Act. Either the Council is a corporation within the meaning of the Corporations Act or it is not. A statement in a State Act cannot change the effect of a Commonwealth Act. If, on proper analysis, the Council is a corporation, within the meaning of that term as defined in the Corporations Act, the fact that the Local Government Act says that it is not a body corporate would not be decisive, and it may be that it would be inconsistent with the Corporations Act and, therefore, void under s 109 of the Constitution. 9 It is not necessary for me to resolve that question, because at present I am of the view that the Council is an exempt public authority. However, Ms Carroll says that she has been taken by surprise in relation to the contention that the Corporations Act does not apply to the Council, and has asked for further time to deal with that matter. In the circumstances, I consider that the appropriate course is to make orders dismissing the proceeding with costs. However, I propose to stay those orders to give Ms Carroll the opportunity of making further submissions on the question of whether the Council is a corporation. 10 In order to avoid further costs, it would be appropriate that those submissions be made in writing. If, having received the submissions, I consider that there should be further argument or I am persuaded that the Council is a corporation, then I would rescind the orders. In the meantime, I would stay the orders until such time as the submissions have been made. I certify that the preceding ten (10) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Emmett. Associate: Dated: 30 October 2012