Wentworth Shire Council v Bemax Resources Limited and Ors [2013] NSWSC 1047

Wentworth Shire Council v Bemax Resources Limited and Ors [2013] NSWSC 1047

Clause 3.1 of the Road Agreement, construed objectively, purported to fix council rates at $100,000 per annum adjusted by ministerial peg for twenty years. However, this clause was beyond the statutory power of the council as it amounted to an impermissible fetter on the council's annual statutory rate-setting duty and was inconsistent with the Local Government Act. Claims under the Fair Trading Act and Trade Practices Act failed as the council's conduct was not 'in trade or commerce' and it is not a trading corporation in the relevant sense. Estoppel and rectification were not established, nor was any recoverable loss or detriment by the plaintiffs shown.

Parties
Plaintiff (2011/259950), Defendant/cross Claimant (2012/299456), Defendant (2012/349485): Wentworth Shire Council; Defendant (2011/259950): Bemax Resources Limited; Plaintiff/first Cross Defendant (2012/299456), First Plaintiff (2012/349485): Peregrine Mineral Sands Pty Ltd; Second Plaintiff/second Cross Defendant (2012/299456), Second Plaintiff (2012/349485): Imperial Mining (Aust) Pty Ltd; Third Plaintiff (2012/299456): Pooncarie Operations Pty Ltd; Fourth Plaintiff/third Cross Defendant (2012/299456), Third Plaintiff (2012/349485): Probo Mining Pty Ltd; Intervenor (2012/299456, 2012/349485): Attorney General for New South Wales
Jurisdiction
Australia
Judgment Date
02 August 2013
Procedural Posture
Principal Judgment / Final Hearing and Decision
Outcome
Judgment for Council against the joint venturers and Bemax. Monetary judgments entered. Cross claim by Bemax parties dismissed. Costs reserved.
Legal Topics
Fettering of Statutory Discretion, Ultra Vires, Construction of Contract, Rectification, Estoppel, Council Rates, Application of Fair Trading Act, Application of Trade Practices Act
Contracts Administrative Law Statutory Interpretation Misleading and Deceptive Conduct Fettering of Statutory Discretion Ultra Vires Construction of Contract Rectification +4 more

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Parties

Wentworth Shire Council

Plaintiff (2011/259950), Defendant/cross Claimant (2012/299456), Defendant (2012/349485)

Bemax Resources Limited

Defendant (2011/259950)

Peregrine Mineral Sands Pty Ltd

Plaintiff/first Cross Defendant (2012/299456), First Plaintiff (2012/349485)

Imperial Mining (Aust) Pty Ltd

Second Plaintiff/second Cross Defendant (2012/299456), Second Plaintiff (2012/349485)

Pooncarie Operations Pty Ltd

Third Plaintiff (2012/299456)

Probo Mining Pty Ltd

Fourth Plaintiff/third Cross Defendant (2012/299456), Third Plaintiff (2012/349485)

Attorney General for New South Wales

Intervenor (2012/299456, 2012/349485)

Procedural Posture

Principal Judgment / Final Hearing and Decision

Legal Issues

  1. 1 Whether clause 3.1 of the Road Agreement validly limited council rates to $100,000 per annum (with pegged increases) for twenty years
  2. 2 Whether the inclusion of clause 3.1 was beyond the statutory power of the council and/or an impermissible fetter
  3. 3 Whether the council engaged in misleading or deceptive conduct under s 42 Fair Trading Act 1987 or s 52 Trade Practices Act

Ratio Decidendi

Clause 3.1 of the Road Agreement, construed objectively, purported to fix council rates at $100,000 per annum adjusted by ministerial peg for twenty years. However, this clause was beyond the statutory power of the council as it amounted to an impermissible fetter on the council's annual statutory rate-setting duty and was inconsistent with the Local Government Act. Claims under the Fair Trading Act and Trade Practices Act failed as the council's conduct was not 'in trade or commerce' and it is not a trading corporation in the relevant sense. Estoppel and rectification were not established, nor was any recoverable loss or detriment by the plaintiffs shown.

Court Disposition

Judgment for Council against the joint venturers and Bemax. Monetary judgments entered. Cross claim by Bemax parties dismissed. Costs reserved.

Orders

  • Judgment for the Plaintiff (Wentworth Shire Council) in 2011/259950 in the amount of $495,550.36 inclusive of interest (as against Bemax Resources Limited) up to 2 August 2013.
  • Cross Claim dismissed in 2011/259950.