The Court of Appeal has delivered its decision in Roads and Maritime Services v Desane Properties Pty Limited [2018] NSW CA 196.

Readers of my blog News will be aware of an earlier post media reports relating to the decision earlier in 2018 in which the NSW Supreme Court held that, for reasons to do with form and substance of paperwork and the precise purpose to which a particular property compulsorily acquired was to be put, the compulsory actions was flawed.

The September 2018 Court of Appeal decision effectively and substantively overruled the earlier decision Desane Properties Pty Limited v State of New South Wales . The Court of Appeal gave a very detailed consideration to the history of the operation of the relevant provisions of the Land Acquisition (Just Terms Compensation) Act 1991 (NSW) (Just Terms Act) and various relevant amendments to it.

In my earlier blog post in respect of the first decision, I suggested that the Court of Appeal would have to apply its mind to how the relevant acquisitions power was being exercised in the particular context.

It did, in a comprehensive examination of the factual material.

Substance over Form – Procuedure

Unlike the first instance decision, the Court of Appeal decided that various alleged deficiencies in the paperwork to do with the Proposed Acquisition Notice (PAN) did not render the PAN used to be defective for want of form or substance relating to minor omissions and departures from a perceived standard form.

In doing so, it referred to a series of earlier decisions and suggested issues of timing of the challenge to a PAN could be relevant, it outlined the purpose and intent of PAN and considered that the paperwork issued substantively complied with the legislative requirement adequately bringing all relevant issues and information to the attention of the landowner.

The Court suggested that only an extremely narrow opportunity existed for injunctive relief to do with the issue of a PAN and that, even there, injunctive relief may be all but useless, as an agency could issue a corrected PAN all but immediately.

Proper Purpose

The issue was, of course, one which depended of the particular wording of the legislation applicable Roads and Maritime Services (RMS) whose exercise of powers involves resorting to compulsory land acquisition powers. As such, the primary need is to check the main purpose against the wording in relevant legislation and whether it is wide enough or narrow enough to achieve the relevant statutory purpose.

On whether the purpose of RMS was proper, the Court of Appeal necessarily had to examine provisions of the Roads Act, 1993 as the source of the compulsory acquisition power and what had been done by the roads authority over a significant period in respect of the property, not simply the provisions of the Just Terms Act.

The acquisition in question was found, at all material times, to be part of the Government’s huge West connect project. The Court of Appeal examined the history and considered prior law.

Samrein Pty Ltd v Metropolitan Water, Sewerage and Drainage Board (1982) 56 ALJR 678 was affirmed as the prior law on the topic.

Time to Determine Purpose

The Court of Appeal concluded that the appropriate time for a considering the proper purpose test was at the time of the purported acquisition. In the Desane context, the overall roadworks were huge and required tunnelling, as well as aboveground earthworks.

The site in question was found to have been intended to have different uses at different times including, at one time, for parking construction vehicles used in the construction of the relevant road works. However and in context, all those purposes related to the overall roadworks project.

It was that purpose which the Court of Appeal determined was the primary purpose in the mind of Roads and Maritime Services at the time of the acquisition.

That, in the end, it was envisaged that the overall area would involve a parkland over the road area was not relevantly an adverse intent undermining the exercise of the compulsory acquisition power by the authority.

Conclusion

I have some concern with the wisdom inherent in allowing too great a flexibility in the paperwork leading to a compulsory acquisition. That is because, it does involve the exercise by a sovereign entity of power against a citizen and the property of that citizen.

The facts, as found by the Court of Appeal, were that the owner of the land was at all material times in possession of the substance of information required under the Just Terms Act and that there was therefore no legal ground to challenge the validity of the PAN on that basis. One has to query whether “close enough is good enough” is really the right policy and law in this context.

On the “proper purpose” test itself, the detailed examination of the factual history propounded in the Court of Appeal decision clearly shows that there is necessarily a degree of “wriggle room” reflective of the fact that all projects have a multiplicity of issues to be addressed.

What is clear from the Court of Appeal decision is:-

1. whether the main substantive purpose of an authority is consistent with its legislation determines the issue;
2. that test is to be applied at the time compulsory acquisition power is exercised, not prospectively whether, at some time in the future, some minor component of the overall lands used in connection with the project might be used for some collateral purpose.

The Future

As it happens, Desane has since sold the land in issue.

I find that a bit of a pity. I incline to doubt whether the NSW Government position would survive in the High Court of Australia, but we will just have to wait for further clarification, when the right case comes along.

The text of the paper is only a summary and discussion of particular facts and principles. It is not to be taken as legal or commercial advice as to any particular factual circumstances.