New South Wales Supreme Court CITATION : Maitland City Council v Barry Murdoch & Anor [2005] NSWSC 762 HEARING DATE(S) : 27 July 2005 JUDGMENT DATE : 2 August 2005 JURISDICTION : Common Law Division JUDGMENT OF : Associate Justice Malpass at 1 DECISION : The summons is dismissed; the plaintiff is to pay the costs of the summons; the exhibit may be returned. CATCHWORDS : Rates paid pursuant to declaration by council as to category - concession that land had been incorrectly categorised - moneys had and received - jurisdiction of Local Court - moneys paid under mistake - areas of challenge available where decision is made in Small Claims Division. Local Courts (Civil Claims) Act 1970, s21B, s69 LEGISLATION CITED : Local Government Act 1993, Chapter 15 Supreme Court Act 1970, s69 Carne v United Medical Protection Limited [2005] NSWSC 556 CASES CITED : David Securities Pty Limited v Commonwealth Bank of Australia (1991-1992) 175 CLR 353 Roxborough v Rothmans of Pall Mall Australia Limited (2001-2002) 208 CLR 516 Maitland City Council (Plaintiff) PARTIES : Barry Murdoch (First Defendant) Local Court of New South Wales (East Maitland) (Second Defendant) FILE NUMBER(S) : SC 10514/05 Mr CJ Leggat (Plaintiff) COUNSEL : Mr CW McEwan SC & Mr M Seymour (First Defendant) Thompson Norrie (Maitland) (Plaintiff) SOLICITORS : Toltz Lahood (First Defendant) I V Knight, Crown Solicitor (Second Defendant) LOWER COURT JURISDICTION : Local Court LOWER COURT FILE NUMBER(S) : 124/04 LOWER COURT JUDICIAL OFFICER : Jackson LCM - 8 - IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION Associate Justice Malpass 2 August 2005 10514 of 2005 Maitland City Council v Barry Murdoch & Anor JUDGMENT 1 His Honour: During 1993, the first defendant purchased land known as 155 High Street, East Maitland (the land). It had erected upon it a building comprised of five flats. 2 The Local Government Act 1993 (the Act) came into force on 1 July 1993. It introduced a new process for the financing of councils (see Chapter 15 ss491-625). Pursuant to those provisions, the plaintiff purported to categorise the land as "business" (a declaration was made pursuant to s514 of the Act). Thereafter, the plaintiff made and levied rates on the land on that basis until 18 November 2002. 3 After first approaching the plaintiff on 6 August 2002, an application for change in category was made by the first defendant on 18 September 2002. The proposed category was that of "residential". The application was made pursuant to s525 of the Act (for a review of a declaration as to category). 4 By letter dated 15 November 2002, the plaintiff advised that the land would be rated "residential urban" and that the rates would be amended from the date of the initial enquiry (it seems to be common ground that this was 6 August 2002). Rates in the sum of $817.40 were then written off. 5 Section 526 of the Act provides for an appeal where there is dissatisfaction with the date on which a declaration is specified to take effect or a declaration of the council. The appeal has to be made within 30 days and is to the Land and Environment Court. 6 The first defendant did not pursue that avenue of appeal. Instead, communication then passed between himself and the plaintiff concerning the recovery of what the first defendant regarded as an overcharge in respect of rates paid (he was seeking to recover the difference between that which was paid by him by reason of the categorisation of "business" and what he would have been liable to pay had it been categorised as "residential"). The plaintiff disputed any entitlement to repayment and no extra curial resolution took place. 7 On 5 August 2004, the first defendant commenced proceedings in the Local Court claiming, inter alia, the sum of $5,883.84. He described his cause of action as being for:- Repayment of rates over-charged in relation to categorisation requirements under Sections 514 & 523(1)(b) of the Local Government Act 1993 and as calculated on Demand Notice of 8 January 2004. 8 The proceedings were defended (inter alia, there was a denial of indebtedness and the contention was made that the claim was not a claim known to law). The proceedings were dealt with in the Small Claims Division of the Local Court. They came on for hearing before Jackson LCM. The first defendant appeared in person. The plaintiff was represented by a solicitor (Mr Kirsopp). 9 At the commencement of the hearing, a significant concession was made by the plaintiff to the effect that it did not disagree that the land had been incorrectly categorised. It presented the issue to be determined by the court as one of whether there was any statutory or other right to a refund of the paid rates (such as payment under mistake). 10 In the introductory section of its written submissions before the Magistrate, the plaintiff said:- The issue in this matter is not whether the council correctly categorised Mr Murdochs property as commercial, it concedes it did not. It made that concession and changed the categorisation to residential as soon as Mr Murdoch advised council. Rather the question is whether Council has any power under the Local Government Act to refund the monies to MR Murdoch and if that question is answered no then the further question arises: does MR Murdoch have any legal method of recovering the funds. 11 On 18 January 2005, the Magistrate delivered his reasons for decision. He found for the first defendant in the sum claimed. 12 On 15 February 2005, the plaintiff filed a summons in this court. It purports to bring a challenge against the decision of the Magistrate. The grounds of the challenge are to be found in the statement filed on the same day. It purports to propound three areas of challenge. Before identifying those areas of challenge, it is convenient to first look at the question of what challenge is available where a decision is made by the Local Court in its Small Claims Division. 13 For the purposes of dealing with this question, the relevant provisions have been identified as being s69 of the Local Courts (Civil Claims) Act 1970 (LCA) and s69 of the Supreme Court Act 1970 (SCA). 14 The relevant provisions of the LCA are as follows:- 69 Appeal (1) Subject to subsection (2), all judgments and orders of a court exercising jurisdiction under this Act shall be final and conclusive. (2) A party to proceedings under this Act who is dissatisfied with the judgment or order of the court as being erroneous in point of law, may appeal to the Supreme Court therefrom. (2A) However, in the case of proceedings in the Small Claims Division of a court, an appeal under subsection (2) lies only on the ground of lack of jurisdiction or denial of natural justice. (2B) Despite subsection (2), but subject to subsection (2A), an appeal does not lie to the Supreme Court against any of the following judgments or orders of a court except by leave of the Supreme Court: (a) an interlocutory judgment or order, (b) a judgment or order made with the consent of the parties, (c) an order as to costs. (3) A party to proceedings under this Act who is dissatisfied with the judgment or order of the court on a ground that involves a question of mixed law and fact may appeal to the Supreme Court, but only by leave of the Supreme Court. The relevant provisions of the SCA are as follows:- 69 Proceedings in lieu of writs … … … (3) It is declared that the jurisdiction of the Court to grant any relief or remedy in the nature of a writ of certiorari includes jurisdiction to quash the ultimate determination of a court or tribunal in any proceedings if that determination has been made on the basis of an error of law that appears on the face of the record of the proceedings. (4) For the purposes of subsection (3), the face of the record includes the reasons expressed by the court or tribunal for its ultimate determination. (5) Subsections (3) and (4) do not affect the operation of any legislative provision to the extent to which the provision is, according to common law principles and disregarding those subsections, effective to prevent the Court from exercising its powers to quash or otherwise review a decision. 15 The first area of challenge falls within that provided by s69(2A) of the LCA. The second area is that which is contended to have been provided by s69(3) thereof. The third area is that which it is contended to have been provided by s69(3) of the SCA. For the purposes of this judgment it is unnecessary to go to the detail of these areas. 16 The appeal was heard on 27 July 2005. Although the appeal involved only a sum in the order of $5,000, the hearing occupied most of the day. Written submissions were supplemented by oral argument. There was reference to many decided cases. 17 The second reading speech (given in the Legislative Assembly on 22 November 1992 on the instituting of the Small Claims Division) provides a powerful indication that any challenge to decision of the Small Claim Division was intended to be restricted to the challenge provided by s69(2A) of the LCA. The speech contains, inter alia, the following:- There will be no appeal of any kind from the decisions of the Small Claims Division other than for lack of jurisdiction or denial of natural justice. The prohibition of appeals is quite necessary if a party is to litigate in the division without the risk of suddenly escalating costs. It is also fair to argue that if the taxpayer is to fund a forum for people who decide to litigate over small matters, it should be a once-only forum and the public purse should not have to contribute the immense costs of providing an appellate procedure. 18 In relying on these provisions, the plaintiff contended that there had been both lack of jurisdiction and denial of natural justice. 19 I shall first deal with the contention of lack of jurisdiction. It is said that the cause of action relied on by the first defendant was not in respect of a debt, demand or damage pursuant to s12(3) of the LCA. It was also contended that the Magistrate purported to exercise jurisdiction which was only had by the Land and Environment Court. I do not accept these submissions. 20 In my view, the cause of action propounded was one of debt that fell within the jurisdiction of the Division. It was one contemplated by the common money count of moneys had and received. It called upon the Magistrate to apply the principles relating to moneys paid under mistake. 21 In my view, the Magistrate did not entertain any challenge to the declaration made by the plaintiff as to the categorisation of the land. It seems to me that this contention misconceives the issues that were before the Magistrate. I consider that he did no more than act upon the concession made by the plaintiff. 22 The challenge on the basis of denial of natural justice was founded on a contention that there was no evidence for findings made by the Magistrate. In my view, that contention was not made out. 23 For the purposes of dealing with this submission, I shall assume that an absence of evidence to support a finding of fact can give rise to a denial of natural justice in proceedings dealt with by the Small Claims Division. It was a question which was the subject of but limited argument. The consideration of it involves the taking into account of the procedure prescribed for the Small Claims Division (including s23B and Practice Note 3/2001). 24 In my view, the concession and other material did place evidence before the Magistrate that supported the findings that were made. 25 Before proceeding to deal with the remaining two areas of challenge, it might be convenient to make some general observations concerning the reasons for decision. 26 The party challenging a decision of the Local Court bears the onus of satisfying the court that the decision should be disturbed. It is not sufficient to merely demonstrate error. 27 It may be that the reasons contain observations which could perhaps have been put somewhat differently. Be that as it may, it seems to me that it is unnecessary to dwell on the question of whether or not there has been error on the part of the Magistrate. The decision that was reached was reasonably open on the material that was before the court. It was sustainable under the law as it now stands concerning payment made under mistake (see inter alia, David Securities Pty Limited v Commonwealth Bank of Australia (1991-1992) 175 CLR 353 at 379 and Roxborough v Rothmans of Pall Mall Australia Limited (2001-2002) 208 CLR 516 at 525). 28 There is issue between the parties as to whether or not s69 of the SCA has application to decisions of the Small Claims Division. The legislation implementing this Division came into force subsequent to the SCA. There seems to be little authority that assists the determination of the question. It was one that was not fully argued in this case. In the light of what has been earlier said in this judgment, it is unnecessary to further consider the question. 29 There is also issue between the parties as to whether or not s69(3) of the LCA applies to decisions of the Small Claims Division. It came into force subsequent to the enactment of s69(2A). I was not referred to any authority on the question and it did not attract detailed argument. 30 Whilst it might be said that the draftsman of the legislation could have been more helpful in disclosing legislative intention, it would seem unlikely that the parliament would have intended to grant a leave to appeal involving a question of mixed law and fact when it had earlier taken away any right of appeal on error in point of law. Whatever be the position, no final view needs to be expressed on this question. 31 The challenge that was mounted in respect of the second area concerned matters such as lack of supporting evidence, insufficiency of disclosure of reasoning process and the taking into account of irrelevant considerations. 32 In part, what is contemplated by this challenge has already been dealt with. I consider that the reasons for decision are sufficient for the purposes of this case. Largely, it seems to me that what is relied on misconceived what was done by the Magistrate. If the area of challenge was available to the plaintiff, I do not consider that it would assist it. 33 If it be the case that s69(3) of the LCA was available to the plaintiff in the present case, the court would have to be first satisfied that it was an appropriate case in which to grant leave. In my view, this is not such a case (Dr Jonathan Carne v United Medical Protection Limited [2005] NSWSC 556). 34 In my view, the plaintiff has failed to discharge the onus of demonstrating an entitlement to relief. The challenge to the decision of the Magistrate fails. 35 The summons is dismissed. The plaintiff is to pay the costs of the summons. The exhibit may be returned. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.