New South Wales Supreme Court CITATION : LESTER v NEW SOUTH WALES ABORIGINAL LAND COUNCIL [2002] NSWSC 205 revised - 5/04/2002 CURRENT JURISDICTION: Common Law Administrative Law List FILE NUMBER(S) : SC 30059/01 HEARING DATE(S) : 13, 14, 15 February 2002 JUDGMENT DATE : 3 April 2002 Robert John Lester (Plaintiff) PARTIES : v New South Wales Aboriginal Land Council (Defendant) JUDGMENT OF : Adams J at 1 COUNSEL : Dr J E Griffiths SC (Plaintiff) Mr T Robertson SC (Defendant) SOLICITORS : Horowitz & Bilinsky (Plaintiff) Woolf Associates (Defendant) CATCHWORDS : Application for declaration - power of NSWALC to remove Treasurer from office - implied power of removal - application of Interpretation Act 1987 - whether excluded by implication - application of Code of Ethics - legitimate expectation that would apply - whether breach of natural justice to disregard code procedure - aggrieved person also member of deciding body and participating in decision making process. Aboriginal Land Rights Act 1983 Interpretation Act 1987 LEGISLATION CITED : Aboriginal Land Rights Regulation 1996 Aboriginal Land Rights (Amendment) Act 1986 Aboriginal Land Rights (Amendment) Act 1990 Wild v Maguire [1970] NZLR 489 CASES CITED : Au Yong v Australian Chinese Forum of NSW Inc (unreported, 7 June 1996 NSWSC Bryson J) Minister of State for Immigration and Ethnic Affairs v Teoh (1994-1995) 183 CLR 273 DECISION : Summons dismissed with costs. IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION/ ADMINISTRATIVE LAW list ADAMS J WEDNESDAY 3 APRIL 2002 30059/01 LESTER v ABORIGINAL LAND COUNCIL OF NEW SOUTH WALES JUDGMENT 1 HIS HONOUR: The plaintiff, a member of the New South Wales Aboriginal Land Council (NSWALC) since November 1991 and since re-elected a number of times, and who held the office of Treasurer, was purportedly removed from that office by a resolution of the Council on 21 December 2001. Amongst other things, he seeks a declaration that this resolution was outside the powers of the NSWALC. 2 The NSWALC is constituted under the Aboriginal Land Rights Act 1983 (the Act), which also sets up Local and Regional Aboriginal Land Councils. The relationship between these levels of organization has varied from time to time and will need to be considered in some little detail to determine the issues in this case. The present form of the Act provides that each Councillor of the NSWALC is to be elected to represent a Regional Aboriginal Land Council area (s 22(3)). The Councillors are elected by persons who are members of a Local Area Land Council within the Regional Council area. Thus, Councillors are directly elected. The functions of the NSWALC are set out in s 23 of the Act. They include responsibility for administration of the large fund created by payment of a percentage of land tax levied in New South Wales under the Land Tax Management Act 1956 and other money provided by Parliament for the purposes of the Act. The NSWALC has assets, in one form or another, of about five hundred million dollars and income and expenditure per year of approximately twenty nine million dollars. It is obvious that the administration of financial resources of this order is a very considerable responsibility. 3 Clause 2 of Schedule 6 to the Act provides that councillors are to "elect a Chairperson, a Secretary and a Treasurer at the Council's first meeting on or after each election of all councillors". There are a number of provisions in the Act relating to removal of councillors which, if the power given under them is exercised, will result in the removal of an office holder but there are no provisions directly dealing with such removal. Clause 3 of Schedule 5 provides for the circumstances in which the office of councillor will be vacated. It is unnecessary to refer to these for present purposes. They certainly do not apply to the plaintiff. Section 56B of the Act automatically removes councillors from office on the appointment of an administrator to administer the functions of the NSWALC and fresh elections must be held to fill the vacancies. Although the regulation making power given by the Act (under s 68) permits regulations to be made concerning the circumstances in which persons holding executive offices of Regional and Local Aboriginal Land Councils may be removed or their offices vacated (sub-s (2)(c1)) and the removal of a member of NSWALC from his or her office as a Councillor "on the ground of a petition calling for the person's removal from office signed by persons entitled to vote at an election for the office" (sub-s (2)(c2)), the Government is not authorised to make regulations with respect to the removal from executive office of a member of the NSWALC. Regulations dealing with these subject matters (except, of course, the last) have been made and it will be necessary to deal with them in due course. The regulation dealing with removal from office of a councillor of NSWALC (Clause 85) gives the power of removal to the relevant Minister. The Council itself has no such power. The effect of these provisions is that there is no express power in the Act concerning the removal from or the vacation of office of an executive officer of the NSWALC and that regulations cannot be made as to this matter. In these circumstances, the Council relied on s 47 of the Interpretation Act 1987 (the Interpretation Act) which provides, "except in so far as a contrary intention appears" (s 5(2)) - " Powers of appointment imply certain incidental powers (1) If an Act or instrument confers a power on any person or body to appoint a person to an office: (a) the power may be exercised from time to time, on occasion requires, and (b) the power includes: (i) power to remove or suspend, at any time, a person so appointed, (ii) power to appoint some other person to act in the office of a person so removed or suspended, (iii) power to appoint a person to act in a vacant office, whether or not the office has ever been filled, and (iv) power to appoint a person to act in the office of a person who is absent from that office, whether because of illness or otherwise. (2) The power to remove or suspend a person under subsection (1)(b) may be exercised even if the Act or instrument under which the person was appointed provides that a holder of the office to which the person was appointed shall hold office for a specified period of time. (3) The power to make an appointment under subsection (1)(b) may be exercised: (a) as occasion requires, (b) in anticipation of a particular event, so as to provide that the appointment shall take effect when that event occurs, or (c) in anticipation of a particular state of affairs, so as to provide that the appointment shall have effect while that state of affairs exists." 4 The plaintiff submits that, having regard, in particular, to the legislative history of the regulation-making power and the form of the Regulations from time to time concerning the executive officers of the NSWALC, s 47 of the Interpretation Act is implicitly excluded from application. The plaintiff also submits that, in terms, s 47 of the Interpretation Act is inapplicable since it refers to the conferring of a power "to appoint a person to an office" (emphasis added) as distinct from the election of a person to executive office under Schedule 6 Clause 2 to the Act. As was observed by Quilliam J in Wild v Maguire [1970] NZLR 489 at 492, "appoint" and "elect" may be "synonymous in one context and not in another" with the result that the appropriate interpretation will usually depend upon the context in which the word is used; see also Au Yong v Australian Chinese Forum of NSW Inc (unreported, 7 June 1996 NSWSC Bryson J). So far as the Interpretation Act is concerned, I think that "appoint" is used as a word of general application comprehending "elect" in the sense that election is appropriately to be considered a mode of appointment. In the particular circumstances here, where the only mode by which the NSWALC can make any decision (which is not otherwise appropriately delegated) is by resolution of a majority of its members, a decision to appoint a member to executive office must necessarily be by election. In the result, I consider that the argument that the Act should be construed as implicitly excluding s 47 of the Interpretation Act also fails but it is necessary to deal with this matter at somewhat greater length. 5 Section 68(2) of the Act permits the Governor to make regulations, inter alia, with respect to - "(c1) the circumstances in which a vacancy shall occur in the office of Chairperson, Secretary or Treasurer of a Regional or Local Aboriginal Land Council and the removal from office of the Chairperson, Secretary or Treasurer of a Regional or Local Aboriginal Land Council, [and] (c2) the removal of a member of the New South Wales Aboriginal Land Council from office on the ground of a petition calling for the person's removal from office signed by persons entitled to vote at an election for the office." 6 Regulations have been promulgated pursuant to the Act: the Aboriginal Land Rights Regulation 1996 (the Regulation). Clause 21 of the Regulation deals with the removal of executive officers of Local Aboriginal Land Councils, and clause 31 deals with their removal in the case of Regional Aboriginal Land Councils. These clauses provide for a protective regime which is the same in each instance: due notice of the motion for removal must be given; the motion for removal must be supported by at least 80% of the members who are present at the meeting; voting must be by secret ballot; and a reasonable opportunity must be given for the office holder in question to reply to the motion. No equivalent regime applies to the removal of executive officers of the NSWALC. Schedule 5 of the Act provides for the vacancy in a Councillor's office on the occurrence of certain specified contingencies, which may fairly be described as conventional. In addition, where the Governor, on the recommendation of the Minister, appoints an administrator of the NSWALC – obviously only in extreme circumstances - the members of the Council are automatically removed from office and fresh elections must be held: s 57B. Section 56C of the Act automatically disqualifies any person from holding any office under the Act who is convicted under s 56B of a failure to disclose a relevant pecuniary interest. This provision is in general terms and would operate to remove a member of the NSWALC from the Council and, hence, any derivative executive office but it could not operate simply to remove a person from that office whilst permitting him or her to continue as a Councillor. Clause 85 of the Regulation permits the Minister to remove a Councillor from the Council where a valid petition is presented calling for that removal. Again, it is the Councillor's office which is vacated, not the executive office, except derivatively. 7 Considering the legislative scheme as a whole, I do not think that there is any implication that s 47 of the Interpretation Act is excluded. It is obvious that, for any number of reasons falling well short of impropriety, or, indeed, not involving impropriety at all, a person appointed by the Council to hold executive office may prove, in the event, to be unsuitable. If the plaintiff's argument be right, such a person could not be removed from that office except by removing him or her from the office of Councillor, itself a very cumbersome and difficult procedure, and which might be completely unjustified, as the circumstances which make it undesirable for that person to continue as an executive officer may not reflect at all upon his or her fitness to be a Councillor. These matters seem to me to be so obvious that the circumstance that, at local and regional level, executive officers may be removed only under the protective regime which I have described above, indicates, not that executive office holders of the NSWALC cannot be removed unless they be removed also as Councillors but, rather, that it is considered that protective provisions are not necessary and that s 47 of the Interpretation Act should apply. It is possible to think of a number of good reasons why there should be such a distinction between circumstances operating at local and regional level on the one hand and those applicable at the level of the NSWALC on the other but it is unnecessary to speculate about this matter. It is sufficient to say that the legislative scheme in its present form does not bespeak by any necessary implication an exclusion of the Interpretation Act regime. 8 The plaintiff, however, submits that such a necessary implication is established by an examination of the legislative history and it is to this matter than I now turn. As originally enacted, s 24 of the Act provided that the term of office of the Chairman, Secretary or Treasurer of the NSWALC "shall expire on his re-election for another term or on the election of his successor at the annual meeting of the Council next following his election". The Aboriginal Land Rights (Amendment) Act 1986 amended this provision by making it subject to the regulations and providing for the power to make regulations in respect of - "(c1) the circumstances in which a vacancy shall occur and the office of the Chairperson, Secretary or Treasurer of an Aboriginal Land Council and the removal from office of the Chairman, Secretary or Treasurer of an Aboriginal Land Council". 9 "Aboriginal Land Council" included, by definition, the NSWALC. Pursuant to this power, clause 22A was inserted in the Regulation in May 1987 providing for the removal from office of executive office bearers of the NSWALC. The regulation was in similar terms to clauses 21 and 31 of the current Regulation and provided the same protections from removal. 10 The Aboriginal Land Rights Act 1983 constituted the NSWALC first by twelve Aboriginal members appointed by the Minister and then, from an appointed day, to be "such members of the Regional Aboriginal Land Councils as are for the time being elected as members of the" NSWALC. Members of the Regional Aboriginal Land Councils were elected in their turn by the members of the Local Aboriginal Land Councils in the areas within the regional area: see ss 15, 19 and 22. Thus, the original structure as enacted in 1983 was that members of the NSWALC were indirectly elected. The Aboriginal Land Rights (Amendment) Act 1990 substituted direct elections of Councillors by aboriginal persons who were members of Local Aboriginal Land Councils: clauses 3 and 4, Schedule 1. A new Schedule 5 was inserted in the Act providing for, inter alia, terms of office of Councillors and vacancies in office. A new Schedule 6 concerned procedures of the NSWALC providing, inter alia, by clause 2, that Councillors were to elect a Chairperson, a Secretary and a Treasurer at the Council's first meeting on or after each election of all councillors. The regulation-making power in s 68 was amended by, in effect, removing the power to regulate the circumstances in which an executive officer of the NSWALC could be removed from office. Shortly after the 1990 Amendment Act was assented to, the Regulation was amended to omit clause 22A, which dealt with the removal of an executive officer of the NSWALC and provided the protective scheme. This had the effect of aligning the text of the Regulation with the Act. 11 It is submitted that the inference which should be drawn from this legislative history is that, far from making it easier to remove executive officers (as would be the case if the Interpretation Act applied), there was a legislative intention to entrench membership of these offices and make it more difficult to remove them, since the Act provided, in effect, that office holders could only be removed by intervention of the constituents utilising the petition mechanism or if an administrator were appointed. I consider that this description of the legislative intention, whilst providing a possible explanation for the changed regime, is an insufficient basis for drawing the conclusion contended for. Having regard especially to the changed mode of election of Councillors to the NSWALC, which gave them a significantly different status than the mode of indirect election which had previously obtained, it is more likely that it was considered appropriate to give them direct responsibility for both appointing and removing executive officers according as they saw the exigencies of the Council's affairs were most appropriately served. Accordingly, I consider that the legislative history does not alter the interpretation which a consideration of the Act itself yields and that s 47 of the Interpretation Act has not been excluded by any contrary intention that might be thought to be implicit in the Act. 12 The plaintiff submits that, in the event that the NSWALC had the power to remove him from his office as Treasurer, the mode by which it was effected denied him procedural fairness in the sense that it was contrary with the Code of Conduct (the Code) instituted by the NSWALC for the purpose of dealing with allegations of improper or unethical conduct. It is submitted on behalf of the NSWALC that the Code does not apply to executive officers as such, but only to them as Councillors. 13 The Code of Conduct is expressed to be a "policy agreement by all Council members to abide by in order to operate efficiently and effectively" (para 1.0). It aims to "set out a standard of behaviours which encourages Councillors to act honestly, fairly and professionally" (para 2.0) and states that the "Code of Conduct policy for Councillors of the NSWALC will be sanctioned by Council and supported by administration" (para 2.0). Its objectives are expressed as requiring "all NSWALC councillors" to have "knowledge and understanding of what appropriate actions are acceptable by Council in accordance with both the NSWALR Act and the Code of Conduct" (para 4.1) and that all "NSWALC Council Members will have knowledge and understanding of what sanctions and penalties apply for breaches of the Code of Conduct" (para 4.2). The Code states that it will be implemented by establishing an Ethics Committee (para 5.2) and that "sanctions and penalties to deal with breaches of the Code of Conduct" will be established (para 5.4). The Code states, amongst the "general principles" that apply to Councillors that it is the role of NSWALC Councillors to uphold the Aboriginal Land Rights Act 1983, that Councillors are responsible for the implementation of the Act and the Council's policies and should provide "direction, guidance and information" to the NSWALC, Local Aboriginal Land Councils, Government and the general public (para 6.1). Councillors are required to act with integrity and in "the Organisation's interest". The "Council must promote confidence in NSWALC" and protect its reputation (para 6.3). A number of what are described as "Councillors' specific accountabilities" are listed and, under the Code, Councillors must ensure that the functions of the NSWALC are carried out (para 7.0). In particular, "the Executive are required to carry out their functions as are identified in the ALR Act and by NSWALC's Corporate Plan and policies and procedures in a fair and impartial manner" (7.14). 14 The Code covers such matters as appropriate dress and personal behaviour both whilst carrying out public duties and also when attending NSWALC meetings (paras 9.0, 10.0). The Code also covers conflict of interest and pecuniary and non-pecuniary interests and disclosure of these matters and has a number of provisions relating generally to honesty and integrity. Other provisions concern such matters as confidential information, accepting gifts or benefits, use of Council's property, travel, communications with staff and the like. The Code requires the establishment of an Ethics Committee elected by Council to manage and oversee the Code of Conduct (para 25.0). The Ethics Committee is required to "manage the process of investigation, call upon any personnel to give evidence, if and when necessary and make recommendation to Council when dealing with breaches of the Code of Conduct" (para 26.0). The Code does not set out a system of sanctions and penalties but, rather, obliges the Council to establish "sanctions or penalties … in line with the type of breaches that have occurred" (paras 27.1, 27.2). Any sanction or penalty "shall only be considered and imposed after considerable consideration has been given to all issues and points of view" (para 27.3) which should take into account "common law rights" and "natural justice principles" (para 27.5). In its original form, the Code provided (para 27.4) that the "decision to sanction a Councillor should be by an overwhelming majority of the Councillors". At the meeting of the Council, called a "workshop", conducted in Albury on 18, 19 and 20 September 2001, the word "overwhelming" was removed for the express reason of permitting a decision to sanction a Councillor to be made by simple majority. Para 27.6 of the Code provides as follows - "After the Council has taken considerable steps provided to them in he process of investigating an alleged or perceived breach of the policy, they will determine what sanctions will be imposed for any breach of the Code of Conduct depending on the severity of the behaviour. Such steps will include:- · Request an explanation. · Request a formal apology. · Issue a reprimand – such an action shall be decided by the Ethics Committee and shall be carried out by the Chairperson. · Counselling the Councillor. · Passing a censure motion at a Council meeting. · Fines in relation to the breach of the policy. · Public disclosure of inappropriate conduct. · Prosecuting any breaches of the law." 15 On 10 March 1999 the Policies and Procedures Manual of the NSWALC was adopted by the Council. That manual included the Code of Conduct. On 19 April 2001 an Ethics Committee was established by the Council comprising the executive officers of the NSWALC, including the Chairperson. 16 The plaintiff claims that accusations were levelled at him by other executive members of the Council which either expressly or implicitly alleged that he had breached the Code. It is not disputed that the Ethics Committee did not conduct any investigation of those allegations nor make any recommendation to the Council. The resolution removing him as Treasurer was simply passed at a meeting of the Council following a debate (which I will come to in due course) of which he was given notice. It is submitted that the plaintiff had a legitimate expectation that the allegations against him would be considered by an Ethics Committee which would give him an opportunity to be heard, that the Committee would then make a report to the Council which would then consider it together with anything which he or other Councillors might wish to say and only then could a motion removing him from his office as Treasurer be considered. 17 Before dealing with the allegations made against the plaintiff, it is necessary to briefly set out some of the context of disputation which had developed between him and the other executive office holders. The plaintiff served as the Councillor on the NSWALC from the Western Metropolitan Regional Aboriginal Land Council area from November 1991 to February 1996, November 1996 to December 1999 and from December 1999 to the present time. He had won elections to that position in November 1991, April 1997 and December 1999. His current term as NSWALC Councillor will expire when fresh elections for the Western Metropolitan Regional Aboriginal Land Council are held sometime between September 2003 and February 2004. On 23 December 1999, at a duly constituted meeting of the NSWALC, the plaintiff was elected by secret ballot to the position of Treasurer. In April 2001, having voluntarily vacated his office together with the Chairperson and Secretary, he was re-elected to the position of Treasurer having been, as it happened, the only nominee. Councillors of the NSWALC are remunerated in accordance with determinations made from time to time by the Statutory and Other Officers Tribunal. Their remuneration is currently $67,145 per annum, the Treasurer and Secretary receiving an extra allowance of 3% and the Chairperson of 5% by virtue of their office. 18 The NSWALC has, over the years, been criticised both by the Auditor General and the Independent Commission Against Corruption (ICAC) for inadequate accounting systems, controls over expenditure and unclear lines of responsibility. In April 1998, the ICAC reported on problems within Aboriginal Land Councils including the NSWALC. That report made a number of recommendations, the implementation of which was the subject of a further report in October 1999. One of the recommendations was that the role of the Chief Executive Officer of the NSWALC should be clarified and strengthened. In part as a response to the ICAC and Auditor General's reports, the NSWALC has developed a detailed overall administrative system designed, amongst other things, to define the proper relationship between the Council as constituted by the Councillors on the one hand and the Chief Executive Officer and the Administration on the other. In early 2001 the NSWALC decided to engage a new CEO and the plaintiff participated in negotiating the terms of his contract of appointment. A conflict soon developed between the plaintiff and the CEO, who was appointed in June 2001, concerning their respective responsibilities. The matter was raised by the plaintiff, as Treasurer, at the Council meeting held in early July 2001. Legal advice was obtained on the relationship between the legislative responsibilities of the Treasurer and the contractual obligations of the CEO, including the lawfulness of delegating certain powers to the latter. (I should point out that I have not been asked and I do not intend to determine the appropriate role either of the Treasurer or of the CEO. I relate this matter simply to give a context for the legal question concerning the applicability of the Code to the removal of the plaintiff from his office as Treasurer.) 19 At its meeting of 8 August 2001, the Council considered the legal advice which had been obtained and resolved, inter alia, that the financial controller of the NSWALC should be directly responsible to the CEO rather than to the Treasurer. This resolution was unacceptable to the plaintiff, who considered that it denigrated from his statutory responsibilities. Accordingly, on 27 August 2001, the plaintiff forwarded a memorandum to the CEO requiring him to obtain his prior approval for all expenditure and to submit all financial reports directly to him rather than to the Council. It is not disputed that these directions were contrary to the Council's resolutions of 8 August 2001. The plaintiff forwarded this memo also to all Councillors, the Auditor General's Office, the Registrar (of Aboriginal owners) appointed under s 49 of the Act and the NSWALC internal audit unit. Amongst other things, the plaintiff gave notice that, as from midday on that date, "no commitment of expenses or payment of expenditure on behalf of the Council are to be paid without my written approval". As to this and other matters there can be no doubt that the Treasurer, in effect, was repudiating the resolutions of the Council of 8 August 2001. On 30 August 2001, the Chairperson of the NSWALC circulated a short memorandum to all Councillors and relevant staff reasserting the authority of the CEO and, in effect, contradicting the plaintiff's memorandum. On 7 September 2001, the plaintiff advised the Chairperson that he had no option "but to seek the relief of the Court", a clear indication that he thought it necessary to commence legal proceedings to resolve the dispute. On the same day, namely 7 September 2001, the Chairperson and the Secretary circulated all Councillors with a notice that it was proposed to hold an Extraordinary Meeting of the Council in Albury on 21 September 2001 in order "to discuss the removal from office [of] Councillor Robert Lester as Treasurer of the NSW Aboriginal Land Council …" The reasons given for the proposed motion of removal were, first, his "failure to follow Council instructions" and, second, "conduct detrimental to the NSWALC". The latter reason echoed, if it did not quote, the Code, para 6.3 - "Integrity and New South Wales Aboriginal Land Council Interest Councillors must act at all times with integrity and with a respectful manner and always act in the Organization's interest. The Council must promote confidence in NSWALC both internally and externally. They should protect NSWALC's reputation and not engage in activities, at work or outside work, that will bring NSWALC into disrepute and always perform their duties in a professional and responsible manner." 20 I should also mention that the Code provides under the rubric "Confidentiality and Personal Advantage" the following - "16.2 Whilst Councillors are privy to such information they shall not use confidential or sensitive information… improperly to cause harm or detriment to any person, body or the NSWALC network." 21 The plaintiff was informed by a letter addressed to him and circulated to all Councillors on the same date - "We understand that… [the motion for removal] is the result of a significant number of Councillors having lost confidence in your ability to take direction from Council and recent actions of yourself whereas the NSW Aboriginal Land Council is being brought into disrepute. Specific mention is made of the memorandums that you saw fit to issue to external bodies wherein confidential in-house issues were brought into the public arena and the latest threat that you intend to take legal action against the CEO and the Board of the NSW Aboriginal Land Council." 22 I am informed that the "external bodies" referred to were the Registrar and the Auditor General. Mr Robertson SC for the NSWALC has submitted that the matter in dispute was essentially a difference of opinion about administration and legislative authority and did not involve any attack upon the propriety of the plaintiff's action. (He certainly made it clear, on the Council's behalf, that there is no suggestion that the plaintiff has acted in any way that involves a question of ethical standards or moral turpitude.) I do not think, however, that the letter of 7 September 2001 by the Chairperson and the Secretary to the plaintiff can be so construed. To my mind, the language in which it was cast can have but one reasonable interpretation, which is to allege that the plaintiff had acted improperly in an ethical sense as well as incorrectly in a legal one. To the letter of 7 September 2001 were attached the relevant Council resolutions, the memorandum of 27 August and the memorandum of 7 September 2001. 23 On 11 September 2001 the plaintiff wrote to the Chairperson and Secretary, with copies to all Councillors stating, amongst other things, that in order "to ensure procedural fairness is applied I now require the Chairperson and Secretary to provide the Treasurer with the details in writing that will substantiate the accusations they and/or other Councillors have made" adding that these "details will allow the Treasurer to respond directly in point form to the accusations". The Chairperson and Secretary responded to this request on 12 September 2001 by asserting that the "issues/concerns that have brought about the Extraordinary Meeting on 21 September have, we believe, been clearly defined". 24 On 20 September 2001 the plaintiff sought an interlocutory injunction in this Court to prevent the Council meeting of 21 September from proceeding, at least in respect of the proposed motion to remove the plaintiff. The basis for this application appeared to be a claim that the complaints about the plaintiff's behaviour were insufficiently particularised to permit the meeting to proceed in accordance with the rules of procedural fairness. The application was heard by Sully J who rejected this argument, concluding that the material that was provided to the plaintiff, together with the submissions put to the Court by Senior Counsel for the Council were clear enough to convey the basis upon which the motion was put and to permit a response to be made. His Honour summed up the substance of the allegations as, first, that the plaintiff failed to give effect to the resolutions of the Council as to the relative responsibilities of himself as Treasurer and the CEO and second, that by writing the memoranda of 27 August and 7 September 2001, he in some way has acted detrimentally to the Council by bringing into what was called the "public arena" the public standing and reputation of the Council. It is only the second of these that could be considered as giving rise to possible suggestions of impropriety. Impropriety, of course, is very much a matter of judgment but, certainly, the material upon which it was sought that the Council should exercise such a judgment was very limited in scope and could not in any substantial sense be the subject of factual disputation. It was also sought to be argued before Sully J that there was no power in the Council to remove the plaintiff from his office as Treasurer. Sully J concluded that the complaints were particularised sufficiently for the purposes of the rules of procedural fairness and decided that it was inappropriate that he should determine the question of the Council's power. 25 I should mention that, in a letter of 17 September 2001 from the plaintiff's solicitors to the Chairperson of the NSWALC, it was stated that the Council had no power to remove the plaintiff by resolution of the Council as proposed, as well as seeking additional particulars of the allegations against the plaintiff. That letter did not suggest that the Code of Conduct was material to the disputation, let alone complain that there had been no investigation or report by the Ethics Committee. Nor was any alleged failure to comply with the Code mentioned to Sully J. 26 The plaintiff was in this Court on 20 September 2001 until approximately 4.30 pm and then conferred with his solicitor for about an hour. In order to get to the meeting in Albury by the time set for the meeting at 9 am the following day, the plaintiff drove overnight from Sydney. The motion for the plaintiff's removal was the only item of business. The plaintiff had prepared a written submission which he proposed to table as well as discuss. In his submission the plaintiff stated - "17. On 20 September 2001, NSWALC's barrister advised the Court that the allegations were as follows: (i) That by my memos of 27 August 2001 to the Chief Executive Officer ("CEO") (see attachment F to the meeting notice), and 7 September 2001 to the Chairperson (see attachment G to the meeting notice), I have failed to follow NSWALC's instructions in its resolution of 8 August 2001 (resolution 6 in the 181th meeting, (see attachment B to the meeting notice). This resolution reads as follows: 'That Council accepts the advice provided by Council's barrister, Mr Ray Moore, in relation to the Council relationship between the Chief Executive Officer and the functions of the Council, such advice having been solicited by the Treasurer.' (ii) That by my memo of 27 August 2001 (see attachment F to the meeting notice) to the CEO, which was courtesy copied to others, I have engaged in conduct detrimental to the NSWALC. (iii) That the threat to take legal action in my memo of 7 September 2001 to the Chairperson (see attachment G to the meeting notice), is conduct detrimental to NSWALC." 27 The plaintiff sought an adjournment for the reason that his submission "was prepared at short notice and it may contain some errors". He made no mention of either the Code or any need for action by the Ethics Committee. The adjournment motion was ruled out of order. After the plaintiff concluded reading his submission he did not, as I read his affidavit, seek to add anything further. There was brief discussion about an amendment of the motion which was then put without further debate by the Chairperson. The motion was carried by six votes to five, including the plaintiff's vote. The meeting then closed. 28 The plaintiff said in his affidavit that he expected that the allegations made against him, once clarified, would be referred to the Ethics Committee and that the procedure set out in the Code would be followed. He stated that he forgot to ask this in the meeting because he was nervous, as he had very little time to prepare his written or oral submissions after Sully J had refused his application for interlocutory relief "and the matter seemed to be proceeding so fast". I observe, however, that the plaintiff did seek an adjournment but without reference to the Ethics Committee. 29 The submission read by the plaintiff to the meeting was a comprehensively drawn document which, amongst other things, dealt with the power of the NSWALC to remove him from his office as Treasurer and with each of the allegations made against him in a detailed and logical way. 30 There is no suggestion in the plaintiff's submission that any further investigation needed to be done by Council to determine the allegations, nor was it suggested that the facts of the matter were not sufficiently before them. Rather the submission argued that the facts alleged did not bear the construction which was sought to be put upon them. No reference was made to the Code or the Ethics Committee. That the plaintiff had forgotten to mention the Code at the meeting is no explanation for omitting any mention of it in the submission nor, for that matter, omitting to refer to it in the application to Sully J. 31 In his evidence before me, the plaintiff agreed that at the relevant time he had a working knowledge of the Code. The plaintiff agreed that the Code had been under development for some time before 1998 and that he had participated in that process both by sitting on committees and at meetings of the Council when the development of the relevant policy had been discussed. The written submissions that the plaintiff tendered to the meeting of 19 September 2001 were prepared in consultation with the plaintiff's solicitor and the plaintiff agreed that he sought in the submissions to raise every matter that might be relevant to persuading his following Councillors not to support the resolution for removal. Although the submission had only been drafted on the day before the meeting, the matters in it had been the subject of discussion between the plaintiff and his solicitor for the purpose of making such a submission should it become necessary to do so. The plaintiff said in his evidence, however, that during this process, it simply did not occur to him that the Code might be relevant. He said that he raised the Code with his solicitor only after the meeting. The plaintiff suggested in his evidence that he had the applicability of the Code in mind before the meeting but because of his turmoil at the meeting, he forgot about it. However, as was pointed out to him in cross-examination, this seems to be at odds with the omission to mention the matter in the submissions which he was involved in preparing for the meeting or, indeed, in preparation for the proceedings before Sully J. As I have mentioned, one of the grounds for seeking interlocutory relief was that the plaintiff had been denied procedural justice in the sense that the allegations against him were inadequately particularised. In this context, the procedures that led up to the meeting or which ought to lead up to a meeting at which it was proposed to remove an office bearer, must have suggested the relevance of the Code, if it were thought that the removal was by way of punishment for a breach of the Code. Indeed, though the plaintiff denied this in his evidence, I think that it inescapably follows from his failure to advert to the possible relevance of the Code that he did not consider, until perhaps shortly before the meeting, that the proposed removal was a disciplinary process. Rather, it was a mode, albeit a brutal one, of resolving the dispute which had arisen between him (and, presumably, his supporters) on the one hand and the Chairperson and Secretary (together with their supporters) on the other as to the respective responsibilities of the CEO and the elected Treasurer and also, perhaps, the power of the Council to direct the Treasurer in this respect. I infer, accordingly, that the plaintiff either had not considered the relevance of the Code to the course of action being taken against him or, if he did, he did not think that it was relevant, at least until after the submission which he ultimately made to the Council was prepared. This is not to say, however, that I do not accept the plaintiff's evidence that he had thought he would raise the Code at the meeting but that, under the pressure of events, he overlooked it. Even so, I do not think that this consideration is decisive. 32 The first question which arises for consideration is whether the Code applied to the proposed removal of the plaintiff from his office as Treasurer. It seems to me that the relationship of the office bearers to the Council is one of confidence in its widest political sense. Thus, for example, if an office bearer were elected upon the basis of some political arrangement or understanding or as the result of the alignment of political or personal relationships which later changed, so that a majority of the Council wished to replace him or her with another, it seems to me clear that such replacement could properly occur even if it were motivated entirely by political or personal considerations and without regard at all to the effectiveness with which the office bearer had been carrying out his or her responsibilities. The removal of an office bearer in these circumstances is in no sense a punishment for impropriety although, of course, impropriety (alleged or proved) might be used by one or more members of the Council to justify his or her vote. This seems to me to be all part of the ordinary and legitimate political process, a process that the very mode of appointment and removal of office bearers is designed to permit. One of the results of this process is that the Council must take ultimate responsibility for its decisions and the decisions of the office bearers which it has, by majority vote, appointed to their responsibilities and which, by majority vote, it can remove. Ultimately, the Councillors will be responsible to their constituents for the way in which they carry out their responsibilities. Thus, an office bearer may well be removed in circumstances to which the Code has no application whatever. At the saem time, the Code does indeed apply to the plaintiff both as a Councillor and as office bearer and, where behaviour in breach of the Code is alleged, the Council should not impose a "sanction" within clause 27.0 of the Code without first undertaking the procedure required by the Code. The list of steps able to be taken by the Council as provided in sub-clause 27.6 is said to be inclusive and, Dr Griffiths SC for the plaintiff submits, does not imply that removal from office is not a step within the contemplation of the Code. However, this submission seems to me to be irrelevant in the present circumstances. The removal of the plaintiff here was by a vote of Councillors on a motion that he be removed. The two Councillors who called the meeting stated the grounds upon which they considered his removal was justified. But the mere fact that a majority of the Councillors agreed that the plaintiff should be removed does not imply in any sense that they accepted that the allegations against him had been proved. They may have voted in favour of the motion for any number of reasons having nothing whatever to do with the rights or wrongs of the plaintiff's conduct in relation to the issues agitated by the proposers of the motion or, for that matter, by the plaintiff in his submission. A motion, on the other hand, which asserted misbehaviour would be tantamount to passing a censure motion and fall specifically within the Code. The taking of such a step is fundamentally different in kind to mere removal from office which, of itself, carries no opprobrium but may simply reflect, as I have said, political or personal considerations operating at the particular time. Even if removal from office is one of the punishments for misbehaviour available under the Code, a person may be removed for reasons other than misbehaviour. The motion removing the plaintiff from his office of Treasurer did not state that he was in breach of the Code. Whatever might have been the view of the Chairperson and the Secretary (or any other Councillor, for that matter) as to whether the plaintiff had acted in breach of the Code, it cannot be inferred that the Council acted on the basis that he had so acted, let alone that he was being punished for doing so. The better interpretation of the Code, however, is that it does not provide by implication for the removal from executive office of a Councillor. It would be most surprising if it were intended to specify less serious "steps", such as passing a censure motion, and yet deliberately omit to mention one so serious as removal from executive office. Moreover, such a specification might lead to the argument, not far removed from that pressed in this case, that an office holder could not be removed unless he or she had been found to be in breach of the Code. For the reasons already given, such a limitation on the powers and responsibilities of the Council would be quite inappropriate. 33 Even if the Code applied to the consideration by the Council of the motion to remove the plaintiff, the question arises whether the failure to follow the Code's procedure vitiates the Council's decision. It was submitted on the plaintiff's behalf that he had a reasonable or legitimate expectation that the Code would be applied and, accordingly, that the Council would not remove him without prior investigation and report by the Ethics Committee of the allegations against him; alternatively, the plaintiff should have been informed that it was not proposed to act under the Code and given the opportunity to submit that the Code procedures should be applied. It is not otherwise submitted that the plaintiff was not accorded procedural fairness. It is not submitted that the plaintiff did not have sufficient notice of the matters that were to be propounded against him by those moving for his removal or that he did not have an adequate opportunity to make reply. Indeed, he was clearly in a position to call for referral of the matter to the Ethics Committee, had he thought of doing so. 34 In Haoucher v Minister for Immigration and Ethnic Affairs (1989-1990) 169 CLR 648 the Minister rejected a recommendation of the Administrative Appeals Tribunal that a deportation order be revoked where there was a Government policy that such a recommendation should be overturned by the Minister "only in exceptional circumstances and only when strong evidence can be produced to justify [the] decision". It was not submitted that the criteria did not apply. It was argued that that there was a legitimate expectation both that the Minister would apply these criteria, and that the deportee would be informed as to the matters which constituted "exceptional circumstances" and "strong evidence" and permitted to make submissions as to whether they were satisfied. The question was, as Deane J put it (169 CLR at 655; cf Dawson J at 659, Toohey J at 671, Gaudron J at 672, McHugh J at 680), whether "the justice of the common law demanded that the appellant be heard" on the matter. Deane J said at 651 (omitting references) - "The notion of a 'legitimate expectation' which gives rise to a prima facie entitlement to procedural fairness or natural justice in the exercise of statutory power or authority is well established in the law of this country…The notion is not, however, without its difficulties. For one thing, the word 'legitimate', is prone to carry with it a suggestion of entitlement to the substance of the expectation [here, that the Code procedure will be applied] whereas the true entitlement is in the observance of procedural fairness before the substance of the expectation is denied. In that regard, there is much to be said for preferring the phrase 'reasonable expectation' which has often been used in judgments in this Court. For another thing, the vagueness of the phrase 'legitimate expectation', which enables it to be used as a convenient label for a broad category of circumstances which will give rise to a prima facie obligation to accord procedural fairness, may convey an impression of comprehensiveness with the result that the absence of an identified legitimate expectation is wrongly seen as a legal mandate for disregarding procedural fairness in any case where no legal right in the strict sense is involved… Where the obligation exists, its precise content varies to reflect the common law's perception of what is necessary for procedural fairness in the circumstances of the particular case." 35 It is impossible to know whether there was a deliberate decision made by any one or more of the members present at the Council meeting of 21 September 2001 not to proceed under the Code. The Chairperson, Mr Towney, deposed that he did not consider that the Code was applicable. Indeed, he regarded it as practically inoperable at the time. Furthermore, he did not consider that the removal of the Treasurer was a disciplinary matter. I think that this was not an unreasonable interpretation of the Code. There is also an important distinction, as it seems to me, between the situation where the decision maker determines a matter adversely to an aggrieved person on the one hand and the case where the aggrieved person is part of the very process of decision making, as here, where the plaintiff participated in the proceedings and voted on the motion. Furthermore, it is clear that the plaintiff, had he wished to do so, was entitled to waive any rights that he might have had to have the allegations against him considered by the Ethics Committee and that the Council was entitled to act upon the basis that he did not desire to have the matter so considered. It has not been submitted here that the failure to refer the matter to the Ethics Committee was productive of any actual unfairness. Moreover, there is no suggestion that any investigation actually needed to be done. All the relevant material was before the Council and whether or not that material justified his removal was very much a question of judgment, a judgment moreover which did not require any conclusion that the plaintiff had acted improperly before his removal from office might be thought to have been justified in the circumstances. 36 It seems to me that this case is quite different from that dealt with in Minister of State for Immigration and Ethic Affairs v Teoh (1994-1995) 183 CLR 273, where it was held that the plaintiff had a legitimate expectation that the Minister would apply to the question of his deportation relevant principles contained in the United Nations Convention on the Rights of the Child, which had been ratified by the Australian Government. It was held that the decision maker should either have applied the principles stated in the Convention or informed Mr Teoh that it was not intended to apply those principles and give him an opportunity to argue against that course. In this case, the members of the Ethics Committee were also members of the Council. The decision which they would have needed to make as members of the Ethics Committee involved the matters of judgment raised by the proceedings in the Council. It was not suggested that the plaintiff in any submissions to the Ethics Committee might have raised different matters to those that he raised at the Council meeting. That the Code procedure was not being followed was evident to everybody at the Council meeting, including, of course, the plaintiff. The fact, therefore, that notice was not given of an intention not to apply the Code of Conduct seems to me to be immaterial. The plaintiff's real complaint comes down to this: that the Council did not advise him that he should consider whether the Code applied. As I have said, whether Councillors thought that it did apply and made a deliberate decision not to mention the matter or thought that it did not apply and acted accordingly or did not consider the matter one way or another does not appear and, in the nature of things, cannot be known. Whether the Code did apply was a live question and it would not have been unreasonable to consider that it did not. In the circumstances, I do not consider that the failure to advert expressly to the possible application of the Code was either unfair in itself or productive of unfairness to the plaintiff. 37 I reiterate that the applicability of the Code and whether or not the Council is obliged to abide by it in the case of a motion asserting impropriety against a Councillor is a question different to that which I have to determine in this case. The allegations made by the Chairperson and the Secretary were not and have not been determined. They were merely stated as the grounds upon which some proponents of the motion for his removal relied. The passing of the motion did not at all imply that the majority of the Councillors accepted that the grounds had been made out. In the event that a resolution should be formulated seeking assent to the allegations, consideration will need to be given to the applicability of the Code and the necessity for an investigation and report by the Ethics Committee before the Council considers any such motion. However, that is not the present situation. 38 Accordingly, I consider that the plaintiff was not denied procedural fairness in respect of the motion to remove him from his office as Treasurer. 39 The plaintiff also complains that the defendant denied him procedural fairness in failing to provide him with a statement of reasons for the resolution. The posing of this issue highlights the difficulties facing the plaintiff's case. In the nature of things, it is impossible to ascertain the reasons which operated in the minds of the individual Councillors comprising the majority against him. Indeed, it seems to me that the Council has no right to ask those members to explain why they voted as they did. It is submitted that more than one allegation was levelled at the plaintiff and he is entitled to know which of those allegations grounded the Council's resolution. But it is inherent in the very nature of the proceedings in the Council that it is possible neither of the allegations was the true basis for any particular vote. It is submitted that the plaintiff is entitled to know the reasons why his denial of those allegations was not accepted. This submission assumes that his denial of them was not accepted, an assumption which in the nature of the case must be speculative. The plaintiff points to the difficulty he is under with exercising his rights of appeal under clause 29 of the Code unless the reasons for his removal are articulated. Clause 29.0 reads - "Council members have a right of appeal through Council and any other appropriate channels". 40 It seems to me that this clause indicates that the decisions contemplated by the Code, despite the reference to a censure motion at a Council meeting, do not contemplate action taken by the Council itself. But, at all events, there is no procedure by which the reasons for the plaintiff's removal can be identified. 41 Accordingly, the Summons is dismissed with costs, both of the substantive hearing before me and the proceedings before Sully J. ********* Last Modified: 04/05/2002 DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. 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