Australia: A right to a hearing found to exist in Victorian compulsory acquisition procedure

Last Updated: 1 July 2019
Article by Tess Kerridge
Most Read Contributor in Australia, July 2019

Summary

This was a compulsory acquisition case concerning an application for judicial review and declaratory relief in circumstances where the Governor in Council has certified that no reservation of land was required before service of a Notice of Intention to Acquire. The plaintiffs sought to challenge the procedural steps under the Land Acquisition and Compensation Act 1986 (LAC Act), from the initial recommendation by the Attorney-General to the Minister that reservation of the land was 'unnecessary, undesirable or contrary to the public interest' under section 5(3) of the LAC Act, up to the publication of the Notice of Acquisition under section 19.

While Justice Garde found that there was no obligation to afford procedural fairness or right to be heard at the point of recommendation or certification under section 5(3) or delivery of a Notice of Intention to Acquire under section 6, His Honour held that there is a right to be afforded procedural fairness at the point prior to the delivery of a Notice of Acquisition.

What does this mean for acquiring authorities?

At present, the prescribed form of the Notice of Intention to Acquire (as set out at section 8 of the LAC Act) and the accompanying Form 4 of the Land Acquisition and Compensation Regulations 2010 does not specifically require the acquiring authority to give the interest holder an opportunity to be heard in relation to the proposed acquisition.

In light of the decision of Caligiuri & Anor v Attorney General (on behalf of the State of Victoria) & Ors (No 2), in order to afford procedural fairness to the interest holder it would be prudent for an acquiring authority to address the following in its covering letter to the interest holder when serving the Notice of Intention to Acquire:

  • provide the interest holder with an opportunity to be heard in response to the matters raised in the Notice of Intention to Acquire, and the proposed acquisition more broadly (including the related project being facilitated by the acquisition (if any)
  • specify the period within which the opportunity to be heard remains open
    • this can be assessed on a case-by-case basis by the Acquiring Authority, however between two weeks and one month is suggested in this decision
    • what is important is that the Notice of Acquisition must not be published until the period during which the opportunity to be heard has closed, the Authority has reasonably considered any submissions, and reached its decision.
  • specify the manner of hearing (whether it be by written submissions only, private meetings, or otherwise) and invite the interest holders to provide supporting information/evidence if they wish.

The acquiring authority or its delegates must give serious consideration to what is submitted by the interest holders and act fairly in making its decision as to whether and how the acquisition should proceed. From the reasons given in this decision, by doing so the acquiring authority will be affording procedural fairness to the interest holder.

Detailed case summary: Caligiuri & Anor v Attorney General (on behalf of the State of Victoria) & Ors (No 2) [2019] VSC 365

Introduction

The plaintiffs sought judicial review and declaratory relief concerning four decisions made under the LAC Act towards achieving the compulsory acquisition of land at 170 and 174 Donovan's Lane Beveridge. The third defendant, Melbourne Water, and the fourth defendant, Yarra Valley water, were Water Authorities that had served notices to compulsorily acquire 5.64 ha of land together with 3.89 ha of easements. They proposed to construct water storage tanks and supply infrastructure on and near Bald Hill on the property as part of the Yan Yean to Bald Hill Pipeline Project. The plaintiff was a developer that had purchased the property from the registered proprietor. It intended to develop the property as a residential subdivision.

The key issue in this proceeding was whether the plaintiff was entitled to be heard by the relevant decision maker prior to the making of each of the following challenged decisions:

  • the Minister's power of recommendation in s 5(3) of the LAC Act
  • the Governor in Council's power of certification in s 5(3) of the LAC Act
  • the decision of the authorities to serve a notice of intention to acquire under s 6 of the LAC Act
  • the decision of the authorities to publish a notice of acquisition under s 19 of the LAC Act.

The plaintiff contended that it was entitled to a hearing prior to the exercise by the Minister or Governor in Council of its power of recommendation contained in section 53 of the LAC Act.

The plaintiff then contended that it was entitled to a hearing by the authorities prior to their decision to serve the notice of intention to acquire, or the notice of acquisition.

In reaching his decision, Justice Garde gave detailed consideration to relevant case law concerning procedural fairness, and the right to a hearing.

Procedural fairness and the right to a hearing

Justice Garde found that the statutory framework of the LAC Act was of paramount importance when considering whether procedural fairness requires a right to a hearing before the challenged decision can be made. If a right to a hearing is implied, the content of the right must be determined according to the statutory intent and in the facts and circumstances of the particular case.

An intention to exclude procedural fairness should not be inferred from the presence in the statute of some rights which were commensurate with some of the rules of procedural fairness. The provisions of the LAC Act should not be taken as excluding the plaintiff's right to a hearing.

The Minister and the authorities made submissions that procedural fairness was excluded by the LAC Act by implication.

Did the Minister or Attorney General have a duty to afford procedural fairness?

For the following reasons, Justice Garde held that a 'right to be heard' did not exist prior to the exercise of the powers of recommendation and certification in section 5(3) of the LAC Act:

  • there would be conflict and inconsistency between the suggested right to be heard in the procedural provisions in the LAC act as to how notices are to be given
  • at this early stage of an acquisition, there would often be considerable practical difficulty in identifying the members of the class of persons who might have an interest in the land to be acquired, and the right to be heard
  • the fact that the certification of the Governor in Council on the recommendation of the Minister can be given in the public interest suggests that Parliament did not intend that persons whose interests in land may be affected by the certification be afforded a hearing at this stage
  • although there is a right to be heard under the scheme of the LAC Act, it arises at a later stage in the acquisition process (namely, upon issue of the Notice of Intention to Acquire) and applies before an authority decides to take a person's interest in land (i.e upon publication of the Notice of Acquisition).

Did the acquiring authorities have a duty to afford procedural fairness, and if so, when?

The plaintiff submitted that it was entitled to be heard prior to the exercise by the authorities of the power to serve a notice of intention to acquire under section 6 of the LAC Act or to publish a notice of acquisition under section 19.

Notice of intention to acquire

His Honour found that the statutory obligation placed on the acquiring authority by section 6 of the LAC Act to make diligent inquiries and serve a notice of intention to acquire on persons with an interest in the land operated as a step in affording procedural fairness

The fact that this step is part of procedural fairness points against the implication of a right to be heard before the power in section 6 is exercised. It points in favour of the implication of procedural fairness after the notice is given

At [151] of the decision, the Court noted that "it would be strange indeed if procedural fairness required a statutory notice of intention to be preceded by an earlier notice advising of an intention to issue such a notice."

Notice of acquisition

Justice Garde held that a person with an interest in land cannot, and should not, be deprived of that interest without the opportunity of being heard by the acquiring authority. Procedural fairness requires that a person who may be deprived of an interest in land, or whose interest in land may be diminished, should have an opportunity to be heard by the acquiring authority before the interest is lost or diminished.

A right to a hearing would provide a person with an interest in land with the opportunity of making a submission and providing supporting information and material to the acquiring authority.

The Court found that it was complementary to the statutory scheme that a person with an interest in land to be acquired is given the opportunity to be heard by the authority before the interest in land is taken or diminished (i.e upon publication of the Notice of Acquisition), for the following reasons (see [153(a)-(k)]:

  • it is consonant with the main objectives of the LAC Act as set out in the second reading speech, and would promote those objects especially objects 3, 4 and 5
  • there is no clear positive legislative intent to exclude a right to be heard as part of procedural fairness prior to a decision by an acquiring authority to serve a notice of acquisition under s 19 of the LAC Act
  • it is logical and fair that a person with an interest in the land who has received a notice of intention to acquire should have the opportunity to respond to the acquiring authority concerning the acquisition of the land, and for the authority be required to afford procedural fairness to a person whose interest in land is to be taken or diminished. This will avoid practical injustice
  • through s 8 of the LAC Act, Parliament has directed that when a notice of intention to acquire is served, the person interested in the land must receive a notice in the prescribed form containing specified information concerning the proposed acquisition. The information provided assists an interested person to make a submission to the acquiring authority. The right to a hearing is a natural concomitant of the giving of a notice of intention to acquire
  • it is just and convenient for the interested person to be given notice of a hearing at this time. The authority can conveniently advise of the opportunity to be heard, and the manner of hearing at the same time as the notice of intention to acquire is served
  • under the statutory timeframe, there is sufficient time for procedural fairness to be rendered by an acquiring authority
  • Parliament imposed protective time limits on the service of a notice to acquire respectful of the position of the person whose interest in land was to be taken or diminished by the compulsory process. Under s 20 of the LAC Act, an interest in land must not be acquired less than two months after the service of the notice of intention to acquire. Although the time can be abridged under s 106(1) of the LAC Act, in the absence of agreement between the authority and the affected person, this can only be done by the Governor in Council
  • Parliament imposed a three month notice period after the date of acquisition and not less than seven days' notice before an authority can enter into possession if all or part of the acquired land is used by a person as a principal place of residence or business of that person
  • it would be consistent with these provisions for procedural fairness to apply before a notice of acquisition is served
  • by this stage of the acquisition process, the class of persons to whom procedural fairness is to be rendered by the acquiring authority has been clearly defined by the inquiry made by the authority at the time when the notice of intention to acquire was served
  • Section 19 does not contain any statutory test that must be satisfied. There is no reference to the public interest. The decision to be made by the authority is whether to compulsorily acquire the land
  • a notice of compulsory acquisition profoundly affects the rights of persons interested in the land including their rights to own, possess, use and develop the land. There is no more serious consequence for a landowner than to be deprived of one's land rights
  • the taking or diminution of a person's interest in land is compulsory and without any redress except compensation in money. There is no sign in the LAC Act that Parliament intended compulsion to extend to the denial of procedural fairness at the stage of acquisition.

Did the authorities provide the plaintiff with the opportunity to be heard prior to publishing the notice of acquisition?

The Court found that the authorities did not afford the plaintiffs procedural fairness, or a fair and unbiased hearing of their objections and concerns prior to the decision to publish the notice of acquisition.

No evidence was found that at any stage the authorities invited the plaintiffs to make a submission to the decision-makers within the authority or its delegates. There was nothing to suggest that the plaintiffs were given notice that they would be heard within a specified timeframe.

Justice Garde found that the procedural fairness at least required the authorities to afford the plaintiffs the opportunity of providing written submissions and other material including expert material as to the effect of the acquisition on them and their proposed subdivision of the property. Just as importantly, procedural fairness required the decision-makers within the authorities or their delegates to give serious consideration to what was submitted by the plaintiffs and to act fairly in making a decision as to whether and how the acquisition should proceed.

On the question of timeframes, the plaintiff submitted that it would not be unreasonable if the time allowed for them to make a written submission was to be a minimum of two weeks. The Court accepted that procedural fairness is flexible and practical in its content, and that a period of up to one month for written submissions and other material to be provided reflected what procedural fairness required in the circumstances.

Conclusion

Procedural fairness requires that a person whose interest in land is to be compulsorily acquired by an authority has, and should have, the right to be heard by the acquiring authority prior to a decision by that authority to take the person's interest in land. This right arises prior to service of a Notice of Acquisition.

This publication does not deal with every important topic or change in law and is not intended to be relied upon as a substitute for legal or other advice that may be relevant to the reader's specific circumstances. If you have found this publication of interest and would like to know more or wish to obtain legal advice relevant to your circumstances please contact one of the named individuals listed.

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