Posted on February 4, 2013 by
ADT considers whether working for organisation funded by council should disqualify councillor
The Administrative Decisions Tribunal has recently considered whether it should make an order disqualifying a councillor from holding civic office who, at the time of her election, worked with a private organisation in a position that was partly funded by the council.
The Tribunal’s decision in the case of Sullivan v Okeno  NSWADT 12 is interesting, as there do not appear to have been any decided cases concerning councillors who work with private organisations that receive funding from the Council and carry out activities in the public interest.
Under s275(2) of the Local Government Act 1993, a person is disqualified from holding civic office ‘if he or she is an employee of the council or holds an office or place of profit under the council’.
Section 329(2) of the LGA empowers the Tribunal to make an order dismissing a disqualified person from civic office. Any person can apply to the Tribunal for such an order LGA, s329(1)).
Ms Rosmairi Okeno was declared elected to Lake Macquarie City Council on 20 September 2012.
At the time of her election, Ms Okeno worked as the Town Centre Coordinator for Morriset under the Town Centre Program, funded by the Council.
Under the Program, Council allocated funds to local business chambers, to be used to support community economic development initiatives. The Southlake Business Chamber & Community Alliance (SBCCA), to whom Ms Okeno contracted her services at the time of her election, was a recipient of funds under the program. The SBCCA was required to meet certain conditions, including the implementation of a local business plan.
Ms Okeno’s position was funded partly by funds received from the Council, and partly from state government grants and other monies raised by the SBCCA. A Council officer was one of three persons on the selection panel. Ms Okeno reported to the Executive Committee of the SBCCA
and her role included liaison with Council officers.
The Tribunal’s decision
The Tribunal did not consider Ms Okeno to be an ‘employee’ of the Council, and therefore focussed its attention on whether she could be
said to occupy an ‘office or place of profit’ under the Council.
The Tribunal examined two High Court decisions, Sykes v Cleary (1992) 176 CLR 77 and Williams v Commonwealth of Australia  HCA 23.
Sykes concerned the disqualification provisions for Federal Parliament. The Tribunal considered that the circumstances of that case were very different from the present.
However, the Tribunal was assisted by the High Court’s decision in Williams, which involved a challenge to the validity of Commonwealth funding of chaplaincy services in State schools, in particular, an arrangement between the Commonwealth and the Scripture Union of Queensland, through which the chaplaincy services were provided. The High Court held that the chaplains did not hold office under the Commonwealth and the mere fact that chaplains were funded by the Commonwealth was not sufficient to render a chaplain the holder of an office of the Commonwealth.
The Tribunal held that the phrase ‘office of profit’ in s275(2) of the LGA 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 to the meaning of ‘place of profit’, the Tribunal assumed that the term ‘place’ referred to those situations where a person did not hold a declared office in a council, but carried out functions in the service of the council.
The Tribunal noted that arrangements under which private organisations received money to carry out functions seen to be in the public interest were commonplace, but that did not mean that those working for such
organisations would be seen to be employees of the government or holders of office or places of profit under the government.
The Tribunal did recognise that there might be some cases where the funding authority exercised such a degree of control over the appointment and work of an individuals engaged by a private organisation, that the individual could be said to be a ‘servant’ of the government. However, this
was not such a case.
The Tribunal noted that Ms Okeno was engaged by the SBCCA, who bore responsibility for her performance, and to whom she reported. She was
not subject to any control and direction by the Council on a day-to-day basis. The Tribunal considered that her circumstances were very similar to the chaplains in the Williams case. The fact that a Council officer was on the selection panel for her role was not significant.
As Ms Okeno had resigned from her position with the SBCCA during the course of the proceedings, it was unnecessary for the Tribunal to consider an alternative application made by Ms Okeno that if it was found that
she should be disqualified under s275(2), the Tribunal should nonetheless
refuse to order her dismissal in reliance on the power in s329(4) of the LGA.
The key factor in determining whether a person who is engaged by a private organisation might be disqualified under s275(2) of the LGA seems to be the degree of control exercised by a council over the appointment and work of the person. The mere fact that a position might be funded by a council, and that council had involvement in the selection of the person for the role, will not lead to disqualification.
Interestingly, as noted above, when discussing this issue the Tribunal stated that there may be some cases where the degree of control is such that an individual in this situation may be a ‘servant’ of the government. Section 275(2) of the LGA does not contain the term ‘servant’. It may be that the Tribunal had in mind that a person subject to a high degree of control would fall within the expression ’employee’ of the Council.