Administrative Decisions Tribunal New South Wales Medium Neutral Citation: Sullivan v Okeno [2013] NSWADT 12 Hearing dates: 17 December 2012 Decision date: 21 January 2013 Before: Judge K P O'Connor, President P H Molony, Judicial Member M von Kolpakow, Non-Judicial Member Decision: The application is dismissed Catchwords: LOCAL GOVERNMENT - Civic Office - Whether elected councillor disqualified - 'Employee' - 'Office or Place of Profit under the Council' - Interpretation - Circumstances - Held not disqualified - Application dismissed - Local Government Act 1993, s 275(2) Legislation Cited: Administrative Decisions Tribunal Act 1997 Local Government Act 1993 Cases Cited: Hyams v Victorian Electoral Commissioner & Buchanan [2003] VSC 156 In Re Webster [1975] HCA 22; (1975) 132 CLR 270 Public Service Association and Professional Officers' Association Amalgamated Union of New South Wales on behalf of Hookey v State of New South Wales (Department of Health Mental Health Review Tribunal) [2012] NSWIRComm 13 Sykes v Cleary [1992] HCA 60; (1992) 176 CLR 77 Williams v Commonwealth of Australia [2012] HCA 23 (20 June 2012); 86 ALJR 713 Category: Principal judgment Parties: James Sullivan (Applicant) Rosmairi Okeno (Respondent) Representation: In person (Applicant) In person (Respondent) File Number(s): 123288 reasons for decision 1Elections for the Lake Macquarie City Council were held on 8 September 2012. On 20 September Ms Rosmairi Okeno was declared elected in the West Ward. 2Mr James Sullivan applied on 9 October 2012 to the Tribunal under s 329 of the Local Government Act 1993 for an order dismissing her from civic office. He contended that she was disqualified, referring to s 275(2) which provides: (2) A person is disqualified from holding civic office on a council if he or she is an employee of the council or holds an office or place of profit under the council. 3Mr Sullivan contends that Ms Okeno is disqualified by her work as the Town Centre Coordinator for Morisset under a Town Centre Program funded by the Council. 4Disqualification provisions expressed in terms similar to s 275(2) are a familiar part of Australian electoral law. Their origin lies in the English Act of Settlement: see further, In Re Webster [1975] HCA 22; (1975) 132 CLR 270 at [12]-[13] per Barwick CJ; Sykes v Cleary [1992] HCA 60; (1992) 176 CLR 77 esp at [12]-[13] per Mason CJ, Toohey and McHugh JJ; and Hyams v Victorian Electoral Commissioner & Buchanan [2003] VSC 156 (Gillard J). 5The Tribunal convened at Newcastle on 17 December 2012. The Tribunal was constituted by three members of the General Division, as required by Schedule 2, cl 5A of the Administrative Decisions Tribunal Act 1997. Mr Sullivan and Ms Okeno each appeared without representation. 6The material before the Tribunal comprised: the applicant's affidavit sworn 14 November 2012; various documents issued by the Council, dealing with Town Centre Program funding and related arrangements (they are marked as exhibits 'A1' and 'R1'). Ms Okeno gave sworn evidence at hearing, and was cross-examined by the applicant. The Town Centre Program 7The Council has had a Town Centre Program since 2008. Its aim is to support community economic development initiatives in key localities of the municipality. It is an annual program. For the 2012/2013 year the Council identified seven localities as town centres, namely Belmont, Cardiff, Charlestown, Morisset, Toronto, Swansea and Warners Bay. 8Under the program, funds are allocated to local business chambers, subject to meeting Council conditions. One of the conditions is that the local business chamber has a contracted Town Centre Coordinator with responsibility for implementation of a local business plan. 9As at the time of her election Ms Okeno was the Town Centre Coordinator for Morisset. She worked part-time hours. The deed governing the program for that locality was between the Council and the Southlake Business Chamber & Community Alliance (SBCCA). She had performed a similar role under previous annual arrangements going back to 2008. 10Ms Okeno's evidence was that she is a self-employed contractor with her own Australian Business Number. She had contracted her services to the SBCCA. They covered a range of duties in relation to local business development initiatives, and included the function of Town Centre Coordinator under the Town Centre Program grant. The Council's funding for that program was $81,700 per annum. Ms Okeno said that 40% of that amount could be used to fund her position. In addition, the SBCCA had funding from other sources that the SBCCA used to fund her position. This included Trade and Investment Funding Grants from the State Government, and moneys raised by the SBCCA from promotional and other activities. 11She gave evidence as to her reporting relationship to the Executive Committee of the SBCCA. She nominated the following officers of the SBCCA as persons to whom she regularly reported - Robert Kemmis (president), Nicole Roberts (executive secretary), Bruce Bayliss (vice-president) and Christine Mastello (treasurer). 12She accepted that her role as Town Centre Coordinator required her to liaise with Council officers, and that she was responsible for preparation of the Business Plan Report required under the funding deed. She stated that she presented the report to the Executive Committee of the SBCCA for endorsement and transmission to the Council. 13She acknowledged that Council has a role in the appointment of a Town Centre Coordinator. She was selected after interview by a panel that included as one of its three members the Council officer with overall responsibility for implementation of the Program, Mr G Hooper. 14We accept Ms Okeno's evidence. It was not challenged in any fundamental respect by Mr Sullivan. Consideration 15It is clear that Ms Okeno was not at any time an employee of the Council in any orthodox sense. The question, therefore, is whether in her role as Town Centre Coordinator she could be said to occupy an office of profit or place of profit under the Council. 16We are not aware of any local government disqualification cases that have dealt with similar circumstances. 17The High Court held in Sykes v Cleary that the Commonwealth Constitution's disqualification of persons who hold any 'office of profit under the Crown' from standing for Federal Parliament (see cl 44(iv)) extends at least to 'persons who are permanently employed by government', even if they are on leave without pay (per Mason CJ, Toohey and McHugh JJ at 582; agreeing, Brennan J at 592; Deane J (who dissented as to the outcome) at 597; Dawson J at 610). This is not a case of that kind. 18A closer analogy is provided by the recent High Court case, Williams v Commonwealth of Australia [2012] HCA 23 (20 June 2012); 86 ALJR 713. The plaintiff challenged the validity of Commonwealth government funding of chaplaincy services to State schools. The High Court examined the arrangement between the Commonwealth and the Scripture Union of Queensland (SUQ) for the provision of chaplaincy services at the Darling Heights Primary School, attended by the plaintiff's children. 19One of the issues was whether s 116 of the Constitution was infringed. Section 116 provides that 'no religious test shall be required as a qualification for any office ... under the Commonwealth'. Did a school chaplain engaged by the SUQ under the funding arrangement occupy such an office? 20Gummow and Bell JJ said at [109] (French CJ at [84], Hayne J at [168], Crennan J at [476]. Kiefel J at [598], agreeing): 109. The chaplains engaged by SUQ hold no office under the Commonwealth. The chaplain at the Darling Heights State Primary School is engaged by SUQ to provide services under the control and direction of the school principal. The chaplain does not enter into any contractual or other arrangement with the Commonwealth. That the Commonwealth is a source of funding to SUQ is insufficient to render a chaplain engaged by SUQ the holder of an office under the Commonwealth. 21Heydon J (in dissent as to the outcome) adopted a similar view on this issue: see [443]-[447]. 22Unlike the Commonwealth provision under notice in Sykes v Cleary, s 275(2) refers separately to 'employees' and persons holding 'offices of profit' (or 'places' of profit). When segregated in this way, we consider that the term 'office' has, as its primary connotation, a government post, usually of some seniority, where the occupant has functions that are to be exercised independently, free from influence or direction (as, for example, a commissioner of customs, a judge or a tribunal member). See further, Local Government, Planning and Environment Service, Vol. C [420,020] (LexisNexis). 23For an illustration of the distinction between an employee and an office holder who is appointed and remunerated otherwise than under a contract of employment, and the differing consequences that might flow in relation to access to certain entitlements, see Public Service Association and Professional Officers' Association Amalgamated Union of New South Wales on behalf of Hookey v State of New South Wales (Department of Health Mental Health Review Tribunal) [2012] NSWIRComm 13. The distinction between office holders and employees was also canvassed in Sneddon v State of New South Wales [2012] NSWCA 351. Australian case-law does not cast light on the difference between an 'office' of profit and a 'place' of profit. We assume that the term 'place' is simply being used to deal with those situations where the person under notice does not hold a declared office of the relevant tier of government but carries out functions in service of that tier of government. 24It is commonplace in modern public funding arrangements for government to make grants to private organisations for the carrying out of functions seen by government as in the public interest. People who work for the private organisations would not ordinarily be seen as employees of the government, or otherwise the holders of government offices or places of profit under the government. 25We accept that cases might arise where it can be demonstrated that the funding authority exercises such a degree of control in the appointment of and work of the individual functionary of the private organisation that, properly characterised, the functionary could be said to be a servant of the government. Mr Sullivan's argument, as we apprehended it, was along those lines. 26Mr Sullivan referred to the degree to which Ms Okeno's income depended on the funds received by the SBCCA under the funding grant, he referred to various reporting clauses in the annual deeds of grant, and he drew attention to the provisions governing the appointment of the Town Centre Coordinator for the locality. 27In our view, all of the provisions were ones of a usual kind in funding agreements between a government authority and a private organisation. 28The evidence is clear that Ms Okeno was employed by the SBCCA on an independent contractor basis. The funding arrangement was made at arm's length between the Council and the SBCCA. It was subject to detailed accountability requirements. Ms Okeno was engaged by the SBCCA. The SBCCA bore ultimate responsibility for the adequacy of her performance. In respect of her role as Town Centre Coordinator, there is no evidence that she was subject to day to day direction or control by Council officers. She was required to perform her function in a manner compliant with the funding deed. The evidence is that she reported to executive members of the SBCCA as appropriate. She had a key role in developing the critical accountability document, the town business plan. We accept that she presented the draft, and related reports, to the Executive Committee, and it reported to Council. 29Her circumstances are very similar to those affecting school chaplains in the Williams case. The only difference as we see it is that she was selected by a process that included a Council officer on the interview panel. We do not regard that as decisive in any way. The officer was only one of three, and we have no evidence as to how the officer performed his role. Application to be Excused 30Further to a letter dated 11 December 2012 to the Tribunal, Ms Okeno advised at hearing that, with the agreement of the SBCCA, she was discontinuing her contract with the SBCCA, effective 7 January 2013. 31In light of our conclusion, it is not necessary to consider Ms Okeno's alternative application that had it been found that her circumstances did infringe s 275(2) that she be excused, in exercise of the power given to the Tribunal by s 329(4) which provides: (4) If the proceedings are based on the ground that a person is disqualified from holding civic office, the Tribunal may refuse to order the dismissal of the person from that office if it is satisfied: (a) that the facts and circumstances giving rise to the disqualification are of a trifling character, and (b) that the acts which gave rise to that disqualification were done in good faith and without knowledge that the person would incur disqualification by doing those acts. 32We note that Mr Sullivan indicated that he accepted that Ms Okeno had at all times acted in good faith. Order The application is dismissed. 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. Decision last updated: 21 January 2013