Administrative Law;
Planning and Environment Law
Client Newsletter
Just give me one good reason …
December 2008
Summary
The Court of Appeal, in East Melbourne Group
Inc v Minister for Planning1 (the Hilton Hotel
case), recently invalidated a decision made on 14
December 2004 by the then Minister for
Planning (the Hon Mary Delahunty MP) under
the Planning and Environment Act 1987 because
the reasons for it were so unreasonable that it
constituted an error of law. The Minister was not
required to give reasons but voluntarily
published reasons at the time of the decision.
The majority judgment of the Court held that
additional evidence may not be adduced to prove
the true reasons are different from the official
reasons (and hence reasonable) if the official
reasons are clearly and carefully expressed.
Therefore internal Departmental documents (eg:
briefing memoranda) could not be admitted in
the Hilton Hotel case to prove the true reasons
were different from the official reasons. The
decision underlines the need for care in
preparing reasons.
Administrative law issues
Introduction
In Victoria, reasons must be given by
Government decision makers if there is a specific
statutory requirement to do so, if the decision is
subject to VCAT review, or if required under s 8
of the Administrative Law Act 1978.
If reasons are not required to be given
for a decision, why give reasons?
As well as helping those affected by a decision to
understand the decision, reasons can improve the
quality (including the consistency) of decisions,
promote public confidence in decision making,
guard against arbitrariness, and help courts and
tribunals to better perform merits review or
judicial review of the decision.2
Judicial review
If reasons are not required to be given, a court
will in a judicial review proceeding, consider
informal reasons given at the time the decision is
made (and other relevant material) to assist the
Court to determine whether the decision ought
to be set aside on grounds it was unreasonable in
the requisite Wednesbury sense,3 that relevant
considerations were not taken into account, that
irrelevant considerations were taken into
account, or that it was made for an improper
purpose.
In the Hilton Hotel case, the East Melbourne
Group Inc successfully sought judicial review of
the Minister’s decision and the Minister’s reasons
were central to the decision to uphold the
appeal.
What was the decision the Minister
originally made?
On 14 December 2004, the Minister decided to
exempt herself from what may be described as
the public notice requirements under the
Planning and Environment Act 1987 (PE Act) in
respect of an amendment to a planning scheme.4
The Minister had exempted herself from all
public notice requirements for an amendment to
the Melbourne Planning Scheme to facilitate the
refurbishment of the Hilton Hotel, a multi-storey
extension to the Hilton Hotel, the refurbishment
of the adjoining MCG Hotel, the refurbishment
of an adjoining heritage dwelling, and a new
apartment block on adjoining land.
The effect of the decision was to enable the
amendment to be approved without further
delay after it had been prepared.
What reasons were given and why
were they given?
The Minister’s published reasons referred to the
economic benefits of the project. She also
referred to the (then) forthcoming 2006
Commonwealth Games. In one passage, she
stated ‘[t]he proposed expansion of the [Hilton
Hotel] and the refurbishment will also ensure the
quality accommodation is provided in a timely
manner to accommodate the demands
anticipated for the Commonwealth Games’.5 In
another passage, she stated delays needed to be
avoided so the ‘redevelopment project’ could
contribute ‘to the accommodation offer available
… for the [Games] in a timely manner’.6
The reasons were given in accordance with an
informal, non-statutory practice note that
applied to a wide range of decisions by the
Minister, of which the exemption decision was
one specified type.7
Trial judgment
The challenge to the Minister’s decision was
dismissed at trial.8 One ground of challenge was
the decision was so unreasonable it should be
voided because no rational Minister could have
believed that the project could be completed in
the approximately 15 months before the Games.
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The trial judge stated the decision would be void
if based on this belief. The judge held that the
public documents9 put a gloss or ‘spin’ on the real
basis for the decision, possibly to avoid or
minimise public criticism.10 The judge went on to
consider internal Departmental documents and
found that the true reasons were to avoid the
uncertainty and delay of a normal planning
appeal and to facilitate only the Hilton Hotel
refurbishment for the Games.11 These true
reasons did not void the decision.
Appeal judgment
The Court stated ‘a decision may be unreasonable
in the Wednesbury sense because it is manifestly
unreasonable, that is, it simply defies
comprehension, or because it is obvious that the
decision-maker consciously or unconsciously
acted perversely … [Unreasonableness] will also
be made out where there was manifest
illogicality in arriving at the decision – there
being illogical findings, or inferences of fact
unsupported by probative material or logical
grounds’.12
The Court confirmed that it may act on the
decision maker’s stated reasons if they
demonstrate errors of law, even if there is no
statutory duty to give reasons.13
The Court relied on the official reasons and the
public documents to find that the true reasons
for the decision were ‘to avoid the delay to the
provision of accommodation which would result
from a combination of expansion and
refurbishment by the time of the [Games].’14
The Court confirmed the general principle that a
court ‘may admit evidence in quite limited
circumstances so as to elucidate, but not
fundamentally collide with, the reasons stated by
the decision-maker.’15
It held the trial judge fell into error by
considering the departmental documents after
‘plainly concluding the identified circumstance
was the publicly stated reason’ because ‘it failed
to assign to the Minister’s stated reason the preeminence which it required’.16 The error the trial
judge fell into was that ‘a review as to whether
the decision was reasonable by reference to all
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the material before [the Minister] constituted an
irrelevant merits inquiry’.17
What does this mean for decision
making?
First, if a decision maker gives informal or nonstatutory reasons at the time of a decision, the
reasons can and will be subject to scrutiny in
judicial review proceedings.
Second, care needs to be taken in preparing any
official reasons to ensure they accurately reflect
the process of decision making and are not
unreasonable in the Wednesbury sense. In
particular, they should be not be prepared to suit
the views of ‘spin doctors’.
Third, although the law in relation to the
admissibility of additional evidence to determine
reasons for decision may not be settled, decision
makers should proceed on the basis that internal
departmental documents are unlikely to be
considered to prove the reasonableness of a
decision if the official reasons are clear. Such
documents should nevertheless be prepared to
ensure consistency with the official reasons to
minimise the risk of challenge.
Planning law issues
The Hilton Hotel case has useful dicta on issues
regarding s 20(4) of the PE Act.
A decision to grant an exemption is a significant
one. It removes the opportunity for public
participation in the process of amending a
scheme.
Before the Hilton Hotel case, a majority of three
cases involving these decisions held that a
Minister is not required to comply with the rules
of procedural fairness.18 The trial judge, in the
Hilton Hotel case, followed the approach in the
majority of these cases. However, procedural
fairness was not a ground of appeal so the matter
was not re-argued.
The Hilton Hotel case also confirms that the
privative provision in s 39(7) of the PE Act does
not oust judicial review.19
The Court held that the practice note is not a
restriction on the use of the power and the only
limitations on the power are those in the subsection itself.20
The main division in the Court was on how the
decision to exempt sat with the related decisions
to prepare, adopt and approve an amendment.
The majority stated the decision is conceptually
separate and doubted that an opinion that an
amendment was in the interests of Victoria
‘could alone constitute a sufficient basis upon
which to exercise the discretion to exempt’.21
Consequently the reasons given to exempt need
to be separate from the reasons to prepare, adopt
and approve an amendment.
The Court rejected the view that a reason for an
exemption must necessarily be confined to the
interests of Victoria in the land the subject of the
proposed amendment.22
A final prescient comment was that the Charter
of Human Rights and Responsibilities Act 2006
may be a factor in future cases on the exercise of
the power.23
For further information
For further information or legal advice on any
issues raised in this newsletter contact:
James Ruddle on 8684 0470
Deputy Victorian Government Solicitor
Jonathan Smithers on 8684 0411
Assistant Victorian Government Solicitor
Geoff Code on 8684 0412
Principal Solicitor
The VGSO is the primary source of legal services
to the Victorian State Government and its
statutory authorities, providing strategic advice
and practical legal solutions.
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[2008] VSCA 217 (31 October 2008) (Ashley and
Redlich JJA; Warren CJ dissenting).
Re Minister for Immigration and Multicultural and
Indigenous Affairs, ex parte Palme (2003) 216 CLR
212 [105] (Kirby P), cited in Hilton Hotel case [225].
Associated Provincial Picture Houses Ltd v
Wednesbury Corporation [1948] 1 KB 223.
PE Act s 20(4).
Official reasons, paragraph 8, cited in Hilton Hotel
case [238].
Official reasons, paragraph 19, cited in Hilton Hotel
case [241].
Minister for Planning, Ministerial Powers of
Intervention in Planning and Heritage Matters
(Practice Note, November 2004). This practice note
was first published in December 1999 to implement
an ALP Election commitment to publish reasons for
Ministerial interventions.
East Melbourne Group Inc v Minister for Planning
(2005) 12 VR 448; [2005] VSC 242 (Morris J) (‘East
Melbourne’).
The judge defined the ‘public documents’ as the
official reasons, the amendment itself, the document
outlining the project incorporated into the scheme by
the amendment, and the explanatory report for the
amendment prepared in accordance with the PE Act:
East Melbourne (2005) 12 VR 448; [2005] VSC 242
[51].
East Melbourne (2005) 12 VR 448; [2005] VSC 242
[62]; Hilton Hotel case [82].
East Melbourne (2005) 12 VR 448; [2005] VSC 242
[63]; Hilton Hotel case [82].
Hilton Hotel case [183].
Hilton Hotel case [228].
Hilton Hotel case [252].
Hilton Hotel case [309].
In dissent, Warren CJ stated there is no absolute
prohibition on the admissibility of additional
evidence and that the reasons in the departmental
documents were consistent with the official reasons.
See Hilton Hotel case [73] – [84] and [109].
Hilton Hotel case [313].
Holding rules of procedural fairness are not ousted:
Antoniou v Roper (1990) 70 LGRA 351. Holding that
rules of procedural fairness are ousted: Grollo
Australia Pty Ltd v Minister for Planning and Urban
Growth and Development [1993] 1 VR 627
(‘Grollo’); Mietta’s Melbourne Hotels Pty Ltd v
Roper (1988) 1 AATR 354.
Hilton Hotel case [188], [361] - [370].
Hilton Hotel case [135], following Grollo [1993] 1
VR 627, 637. Section 20(4) of the PE Act requires
the Minister to be satisfied that ‘compliance with any
of [the notice requirements] is not warranted or that
the interests of Victoria or a part of Victoria make
such an exemption appropriate’.
Hilton Hotel case [190], [191]. Warren CJ took a
different view in dissent at [144], [148]: a decision
within those limitations must be made within the
‘planning framework’ of the PE Act and ‘the various
planning instruments and policies emanating from it’
and the Minister must ‘strike a balance between
competing factors’.
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‘We think a benefit accruing in the interests of
Victoria – not being a benefit which will accrue from
the subject land itself – might in some cases
legitimately be relied upon by the Minister in making
a decision to exempt. Whether reliance will be
legitimate in a particular case, in our opinion, will be
a matter of fact and degree’: Hilton Hotel case [357].
Hilton Hotel case [163].