COUNCIL OF CASINO v ELJO PTY LTD and ANOR SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL MAHONEY ACJ, CLARKE and BEAZLEY JJA 12 August 1996, 19 September 1996 [1996] NSWCA 535 S68 Local Government Act 1993 — activities to be carried out only with the approval of Council — transport of waste for fee or reward — appeal from Council's refusal of application — s89 Local Government Act 1993 — Council and Court to give effect to applicant's objectives to the extent compatible with public interest Prior to the introduction of the Local Government Act 1993, the Council of Casino, the appellant, was responsible for the collection and disposal of waste in the municipality. This task was carried out by contractors selected on a tender basis. When the new Act came into force the respondent, Richmond Waste, sought approval in accordance with s68 to carry out the activity of transporting waste for fee or reward. The application was refused by the Council. The respondent sought a review of the decision and the Council adhered to its refusal. The respondent then lodged an application in the Land and Environment Court appealing from that determination. The appeal, which proceeded by way of rehearing in accordance with s89 of the new Act, was heard by Bignold J. Although his Honour did not accept the respondent's submission that the Council took into account an irrelevant consideration, namely, the maintenance of its existing monopoly, he allowed the appeal on the basis that there was no evidence that the proposed activity would or may undermine the Council's existing arrangements. The Council now appeals. Held: (1) His Honour did not err by reversing the onus of proof or adopting a wrong onus. On the contrary, what he was doing was considering, as he was bound to, the public interest matters raised by the Council in opposition to the grant of the application. (2) In using the word "requires" in the critical concluding paragraph, His Honour did not misconstrue s89 of the new Act. His Honour was merely indicating, in light of his factual findings concerning the matters in issue, that a decision in favour of the respondent was clearly indicated. (3) His Honour did not determine that the Council had demonstrated bias nor did his ultimate conclusion rest on any finding of bias. Orders Appeal dismissed with costs. Mahoney ACJ I agree with the orders proposed by Clarke JA and generally with his Honour's reasons. This is an appeal only in respect of errors of law: see Land and Environment Court Act 1979, s57. It is therefore necessary for the Council to establish that the orders made by Bignold J were affected by an error of law. It is accordingly necessary to examine the terms of his Honour's judgment to determine the basis upon which his orders were made. It does not appear to have been in issue but that, prior to 1 July 1993, the date of commencement of the local Government Act 1993, the Council, and the Council alone, had been responsible for the relevant activity. (That activity involved the collection and disposal of all trade waste as described by the learned 2 UNREPORTED JUDGMENTS judge). As the result of contracts or arrangements made by it, the position, as at the commencement of the 1993 Act, was that the Council had entered into a contract with GD and J Trew for the collection by them of trade waste for a period of five years from 1 October 1992. That contract remained in existence at all relevant times. Nor does it appear to have been in contest but that the Council desired to continue the position that trade waste would be collected by it alone by means of such a contract or otherwise. It was the desire to continue such "a monopoly on trade waste processing and recycling" that influenced it in refusing the respondents' application. It was in this context that the matter came before his Honour. It is accepted that the matter was before the learned judge as on an application de novo. The matter was to be determined by the judge upon the basis of the evidence then put before him and it was to be determined according to the merits of the matter as, within the law, he assessed them to be. The proceeding was not one by way of review of what the Council had done nor was it dependent upon the correctness of what the Council had done or the approach taken by it. The judge exercised all the powers and functions of the Council in determining whether the respondents' application should be granted: see Land and Environment Court Act 1979, s39. The basis of his Honour's decision appears in the paragraphs of his judgment under the heading "Conclusions and Orders". His Honour appears to have accepted that it was relevant for the Council, and so the Court, to take into account the Council's desire to maintain "a monopoly on trade waste processing and recycling". The Council did not, as I understand its argument, contend to the contrary. The respondent companies, being desirous of upholding what the judge did, did not so contend. His Honour also accepted that the Council's "current contract for waste management" was a matter of "public interest" within s89 and accordingly a matter proper to be taken into account. Were his Honour's reasoning to have stopped there, it might have been thought that he would have concluded that the respondents" application should be refused. But his Honour indicated that he was not "satisfied" that what the respondent proposed to do in the area of waste management "will in any way undermine or prejudice the Council's existing statutory charter or duties or its contractual obligations". His Honour said that there was "no evidence that the applicant's proposed activities will interfere with the current contract or detract from the Council's revenue raising capacity under Chapter 15 of the LG Act or will adversely impact upon the matters of public interest necessarily entailed in the protection of the environment and the protection of public health, safety and convenience (s89(3))". As I understand his Honour's judgment, he concluded that, though the Council's present contract was directed to maintaining its previous monopoly position, the applicant's proposal would not "undermine or prejudice" it. This is essentially a finding of fact: it does not depend upon the application of any principle of law. His Honour then said: "Tn these circumstances and in the light of my factual findings, it appears to me that the statutory direction contained in s89(2) of the LG Act 'to seek to give effect to the applicant's objectives to the extent to which they are compatible with the public interest' requires a decision favourable to the Applicant by granting URJ COUNCIL OF CASINO v ELJO PTY LTD and ANOR (Clarke JA) 3 approval to the Applicant's limited proposed activities to enter into private arrangements with businesses and industries within the Casino area for the provision of the proposed trade waste removal services to be supplied by the Applicant." Mr Thompson, for the Council, submitted that there was, in this part of his Honour's judgment, a reversal of onus or at least the adoption of a wrong onus and that in this lay an error of law. I am not satisfied that this matter turns upon questions of onus. The judge was, in following the flow, back and forth, of his factual reasoning, indicating the steps in his reasoning. I see no error of law in this. His Honour's use of the word "requires" causes more difficulty. If his Honour meant by "requires" that the circumstances and his factual findings compelled a decision favourable to the applicant as a matter of law, I would see in that an error. But in the end I am not convinced that this is what his Honour meant. I have come to the conclusion that, in the passage I have cited, his Honour was indicating what, following his process of factual reasoning, should be his decision upon the respondents' application. So understood, there was, I think, no error of law involved. For these reasons I agree with the orders proposed by Clarke JA. Clarke JA This appeal is about the collection of trade waste in the Municipality of Casino in the context of the provisions of Chapter 7 of the Local Government Act 1993 ("the new Act"). Prior to the introduction of the new Act the Council of the Municipality of Casino ("the Council") resolved to conduct its own garbage collection service and to lease the necessary equipment. It then invited tenders from contractors for the collection of, amongst other items, trade waste utilising Council's plant and equipment. On 16 April 1992 the Council entered into an agreement with Mr Hendrix who undertook to operate the Council's equipment and collect garbage within the municipality. That agreement was to continue for five years from 16 April 1992. It was subsequently terminated by mutual agreement on 17 September 1992. Upon the termination of the agreement with Hendrix the Council entered into a fresh agreement, on 1 October 1992, with Gregory Peter Trew, Julie Ann Trew and David Robert Trew (the Trews) under which the Trews agreed to collect the garbage in the municipality for a period of five years. Apparently in 1992 the respondent (Richmond Waste) was itself conducting a trade waste collection and disposal service in the Municipality. This action provoked the Council to seek a declaration and an injunction preventing Richmond Waste from continuing those activities. On 26 November 1992 interlocutory orders in the terms sought by the Council were made and these orders were made final on 4 February 1993. Once the new Act came into force on 1 July 1993 Richmond Waste sought to take advantage of its provisions and applied for approval pursuant to s68. In summary, that section provided that a person may carry out certain activities only with the approval of the Council. Richmond Waste sought approval for carrying out one of the stated activities - "for fee or reward, transport waste over or under a public place". This application was first considered by the General Purposes Committee of the Council on 14 September 1993. The relevant portion of the minutes of that meeting read: "Recommendation: That Council - 4 UNREPORTED JUDGMENTS (a) Confirm that the Management of Waste in the Casino Council area is to be undertaken by Council through its Contractors, currently G, D and J Trew. (b) Determine that the application from Richmond Waste for Council approval for 'Management of Waste - for fee or reward, transport waste over or under a public place' be refused, such refusal to be based on Council's previous resolution to conduct the collection and disposal of garbage and trade waste within the Casino Council area. (c) That the matter be referred to the Department of Local Government for interpretation." That recommendation was adopted by the Council whose General Manager wrote to Richmond Waste on 30 September 1993 advising of the resolution. On 14 October 1993 the solicitors for Richmond Waste sought a review by the Council of its refusal. On 10 December 1993 the Council, which had previously received the advice which it had sought from the Department of Local Government, wrote adhering to its previous refusal. Following the final refusal of the Council, Richmond Waste lodged a class 2 application in the Land and Environment Court appealing from that determination. The appeal is provided for by s176 of the new Act and the powers of the Land and Environment Court on appeal appear in s39 of the Land and Environment Court Act 1979 ("the Court Act"). By virtue of subs(2) the appeal is by way of rehearing and fresh evidence or evidence in addition to, or in substitution for, the evidence given on the making of the decision may be given on the appeal. By subs(4) the Court is required to have regard to the relevant statutes, any instrument made under a relevant Act, the circumstances of the case and the public interest. By subs(5) the decision of the Court shall be deemed to be the final decision of the Council. The appeal was heard by Bignold J who pointed out that s89 of the new Act set out the matters for consideration. His Honour noted that there were no relevant requirements pursuant to s89(1) so that the relevant statutory provisions were subs(2) and subs(3) which read: "(2) If no such requirements are prescribed and no such criteria are adopted, the council in determining an application is to take into consideration all matters relevant to the application and is to seek to give effect to the applicant's objectives to the extent to which they are compatible with the public interest. (3) Without limiting subs(2), in considering the public interest the matters the council is to consider include: (a) protection of the environment, and (b) protection of public health, safety and convenience, and (c) any items of cultural and heritage significance which might be affected." His Honour also referred to the statements of issues filed by the parties which contained Richmond Waste's claim that Council was improperly endeavouring to secure its monopoly, and the Council's response that it was already providing a trade waste service sufficient to meet the needs of the municipality. In his conclusion Bignold J said that he did not accept Richmond Waste's submission that the Council took into account an irrelevant consideration in refusing the application. He stated that he considered that the existence of the Council's statutory charter (s8 of the new Act), the Council's service function, (s24 of the new Act) and the current contract for waste management to be matters relevant to the application and, as well, matters of public interest. His Honour URJ COUNCIL OF CASINO v ELJO PTY LTD and ANOR (Clarke JA) 5 pointed out that there was no evidence that the proposed activity of Richmond Waste would or may undermine or prejudice the Council's existing arrangements and went on to say: "... it appears to me that the statutory direction contained in s89(2) of the LG Act 'to seek to give effect to the applicant's objectives to the extent to which they are compatible with the public interest' requires a decision favourable to the Applicant by granting approval to the Applicant's limited proposed activities to enter into private arrangements with businesses and industries within the Casino area for the provision of the proposed trade waste removal services to be supplied by the Applicant." Primarily for this reason his Honour allowed the appeal. The Council acknowledges that the appeal is limited to questions of law (s57(1) of the Court Act) and identified the following errors: "(1) His Honour reversed the onus of proof; (2) His: Honour misconstrued s89 of the new Act and erroneously held that he was required to grant a decision favourable to Richmond Waste; and (3) There was no evidence to support his Honour's conclusion that the council had determined the application in a biased way." The first submission was based on what was said to be the following erroneous statement by his Honour - "However the Council has not satisfied me that the proposed activity of the Applicant will in any way undermine or prejudice the Council's existing statutory charter or duties or its contractual obligation. Most significantly there has been no evidence that the Applicant's proposed activities will interfere with the current contract or detract from the Council's revenue raising capacity under Chapter 15 of the LG Act or will adversely impact upon the matters of public interest necessarily entailed in the protection of the environment and the protection of public health, safety and convenience (s89(3)). These potential impacts, apparently apprehended by the Council (vide its resolution refusing the application) are far from being self evident." This statement followed his Honour's observation that the Council's reliance upon the maintenance of a monopoly was not an irrelevant consideration. Although I am not convinced that his Honour was correct in that observation I will assume, for the purposes of the present argument, that the thrust of the Council's stance was that it was contrary to the public interest to allow another trade waste collection service to operate in the municipality. S89 sets out the considerations which the Council, and on appeal the Court, is required to consider in reaching a determination. The overriding consideration is the statutory instruction that effect is to be given to the applicant's objectives insofar as they are compatible with the public interest. What is required is that the Council, and the Court on appeal, identify the objectives of the applicant and the public interest considerations which are adverse to, or favourable to, those objectives. Once the various considerations have been identified it is necessary to weigh them in order to determine whether it would be compatible with the public interest to grant the application, either conditionally or unconditionally, or to refuse it. In addition s89(3) directs attention to specific matters which, where relevant, should be taken into account. They could be described as important public interest factors which, where relevant, must be taken into account. In the present case no one has suggested that there are any questions as to the protection of the environment, or items of cultural or heritage significance, involved. Although 6 UNREPORTED JUDGMENTS matters of public health, safety and convenience could conceivably have been involved in the application no specific argument on those questions was addressed to Bignold J. An that seems to have been said was that because of the existing arrangements the public interest would not be served by the grant of the application. Bignold J found that Richmond Waste was an experienced operator in the waste collection industry whose operations are centred on northern New South Wales where it holds waste management contracts from the Councils of Tweed, Kyogle, Tenterfield and Byron. He found that Richmond Waste had recently obtained a current licence under the Waste Disposal Act 1970 from the Environment Protection Authority to transport waste for fee or reward and that it had been requested by certain industries and businesses in the Casino area to conduct trade waste services for them for fee or reward. His Honour observed that it was not Richmond Waste's intention to enter into any contract with the Council or to hinder the Council in the discharge of its services function under s24 of the Local Government Act. For its part the Council pointed out that the Waste Disposal Act 1970 only applied to the Sydney Metropolitan Waste region and submitted that there were no public interest considerations supporting the grant of the application because the Council provided waste management services to its rate payers in an adequate and satisfactory fashion. The evidence did not descend to greater detail than is indicated by what I have said. In these circumstances there can be no doubt as to the objectives of Richmond Waste and the question which his Honour had to determine was whether those objectives could be given effect to consistently with the public interest. In my opinion his Honour correctly identified the question and, in the passage under challenge, was dealing with the contention that the applicant's objectives were not compatible with the public interest. Having regard to the submissions advanced by the Council his Honour had to determine whether there was anything in the evidence which supported its contention that the grant of the application would be inconsistent with the public interest insofar as the Council was already dealing satisfactorily with the disposal of trade waste in the municipality. His Honour correctly observed that the maintenance of the monopoly was not self-evidently a matter of public interest and, in the context of the new Act and where the Council did no more than assert a wish to maintain that monopoly because it believed that the service it was providing was adequate, concluded that it had failed to demonstrate that the public interest would be damaged in any way by the grant of Richmond Waste's application. In my opinion the approach indicated in the passage under review was a correct one. I reject the notion that his Honour has in some way reversed the onus of proof. On the contrary what his Honour was doing was considering, as he was bound to, the public interest matters raised by the Council in opposition to the grant of the application. In its second submission the Council fastened on his Honour's use of the word 'requires'. It submitted that there was nothing in the Act which obliged the Court to give a decision favourable to Richmond Waste and contended that, to the extent his Honour had reached a contrary conclusion, he had fallen into error, presumably because of a failure properly to construe s89. According to the Council the terms of s89 provided no support for the view that the statutory direction required a decision in favour of Richmond Waste. What is more, the URJ COUNCIL OF CASINO v ELJO PTY LTD and ANOR (Beazley JA) 7 argument proceeded, the approach evident in his Honour's judgment diverted his attention from the relevant considerations which arose under s89(3)(b). The cornerstone of the submission is the word 'requires'. There is, of course, nothing in s89 which required the judge to reach a decision favourable to Richmond Waste. I would accept at once that the use of the word 'requires' in a judgment in which a judge resolves a factual dispute or exercises a discretion is apt to cause difficulties. A judge is rarely, if ever, required to resolve a factual decision, or exercise a discretion in a particular way and, generally speaking, it is, in my opinion, desirable to avoid the use of language which might suggest otherwise. If I considered that Bignold J was saying in the critical passage, that he was required (in the sense of obliged) by s89(2) to find against the Council I would be inclined to agree with the Council's submission. But in my opinion Bignold J was not saying that. What I would understand Bignold J to have been saying, was that in the light of his factual findings concerning the matters in issue, in particular those findings in the preceding paragraph concerning possible issues under s89(3), a finding in favour of Richmond Waste was clearly indicated. To put it another way his Honour was, in my view, saying that his factual findings led almost inevitably to his ultimate conclusion. I do not find this surprising for his Honour found no support in the evidence for the primary case mounted by the Council, that is, that its current waste collection arrangements, and consequently the public interest, would be damaged by the allowing of the appeal. Accordingly there was nothing of substance standing in opposition to the giving effect to Richmond Waste's objectives. The final ground is without substance for his Honour did not determine that the Council had demonstrated bias nor did his ultimate conclusion rest on any finding of bias. Although his Honour referred to s88(1), in which the word 'bias' occurs, he did so in the context of demonstrating that the Council was obliged to give full effect to s89(2) and s89(3). I see no error in what his Honour did. The appeal should be dismissed with costs. Beazley JA I have had the advantage of reading the judgments of Mahoney P and Clarke JA with which I agree. I agree with the orders proposed. Appeal dismissed with costs. Representation: Counsel for the Appellant: AJJ Thompson Solicitors for the Appellant: Mitchell Playford and Radburn, Casino Counsel for the Respondent: MJ Craig QC and S Winters Solicitors for the Respondent: Hannigans, Casino