Posted on October 3, 2019 by Sue Puckeridge and Lindsay Taylor 1

OLG Circular: Council Disciplinary Powers under the Model Code of Conduct Procedures

On 2 October 2019, the Office of Local Government (‘OLG‘) issued Circular No 19-25 (‘Circular‘)  following the recent Supreme Court decision in Cornish v Secretary, Department of Planning, Industry and Environment [2019] NSWSC 1134 (‘Cornish‘).

The OLG is considering the implications of the decision in Cornish. While it does so it is discouraging councils from imposing penalties on councillors for breaches of codes of conduct other than those under clauses 7.59(h) (censure) and 7.59(i) (censure and referral to the OLG) of the Procedures for the Administration of the Model Code of Conduct for Local Councils in NSW (‘Procedures‘).

We agree with this advice.

In short, Cornish found that the Procedures cannot provide a source of disciplinary power beyond that which is in the Local Government Act 1993 (‘LG Act‘) itself.

This is because the LG Act permits regulations to be made for the administration of the model code of conduct (s440AA of the LG Act). This does not extend to permitting the Procedures to confer disciplinary powers on a council.  To interpret that provision otherwise would be inconsistent with the structure of the LG Act, which limits the council’s formal disciplinary powers to the power to censure for misbehaviour (s440G of the LG Act).

The powers under s440G are more restrictive than the powers of the Departmental Chief Executive to impose penalties.  Such powers include: the power to order a councillor to apologise for misconduct (s440I(d)), to undertake training (s440I(e)) or to participate in mediation (s440I(f)), or to refer a matter the Tribunal (s440J).  The s440G powers are also more restrictive than those of the Tribunal (s482A of the LG Act).

To allow what is now clause 7.59 of the Procedures to operate with the model code of conduct to create a new scheme of misconduct by regulation and engage the more extensive powers of the Tribunal and the Departmental Chief Executive (now Secretary) would require clear language which is not in the LG Act.

The Circular also advises that Cornish held that that it remains open to general managers and conduct reviewers/investigators to informally resolve code of conduct complaints. While the  decision does not specifically deal with general managers’ and conduct reviewers’/investigators’ powers, it does find that resolutions by voluntary steps are not disciplinary penalties. On this basis, we agree with OLG’s conclusion.

Finally, the Circular states that the decision does not impact on:

• a council’s ability to make an investigator’s finding of a breach of the code public (cl 7.59(f) of the Procedures), or
• in council’s ability to take disciplinary action under the Procedures for code of conduct breaches by council officials other than councillors.

We agree with the first point.  The publication of an investigator’s report is incidental to the power of censure (Cornish at [51]).

As to the second point, no finding was made in Cornish to this effect.  The Court held that s440AA is limited to making regulations to prescribe procedures for dealing with contraventions of the model code and those procedures should not be read as ‘permitting Procedures which conferred disciplinary powers on a council‘ (Cornish at [52]).  The Court was not considering the powers of the council to take disciplinary procedures against other officials.  Section 428 of the LG Act gives certain disciplinary powers to the Tribunal to be exercised if complaints are proved against other council officials, but the LG Act does not otherwise deal specifically with such powers.  In our opinion, the question remains open.

A copy of the decision in Cornish can be found here.

A copy of the Circular can be found here.

If you want to discuss the issues raised in this post, please contact Lindsay Taylor on 8235 9701 or Sue Puckeridge on 8235 9702.