Posted on July 16, 2025 by Megan Hawley and 1

Personal Relationships and Conflicts of Interest

Councillors and other council officials have an obligation under s440 of the Local Government Act 1993 to comply with their council’s adopted Code of Conduct, which is based on the Office of Local Government’s model Code of Conduct (Code).

Part 5 of the Code relates to ‘non-pecuniary conflicts of interest’ which are ‘private or personal interests a council official has…’ and which ‘commonly arise out of family or personal relationships, or out of involvement in sporting social, religious or other cultural groups and associations’. Clause 5.2 of the Code notes that there will be a non-pecuniary conflict of interests where a reasonable and informed person would perceive that the council official could be influenced by a private interest.

The Code requires such interests to be fully disclosed. The Code also distinguishes between significant and non significant conflicts. Significant conflicts include those where the relationship is ‘particularly close, such as friendships’. Closeness is defined in part by frequency of contact.

It can often be difficult for council officials to determine when social contact or interaction with a person could give rise to a non-pecuniary conflict of interest.

This was considered in the recent decision in Deputy Secretary, Local Government, under delegation from the Secretary, Department of Planning, Housing and Infrastructure v Saravinovski [2025] NSWCATOD 10 (Saravinovski),

Background

Councillor Saravinovski was accused of a number of breaches of the Council’s Code, including a failure to properly disclose a conflict of interest.

The Council considered a report on a draft planning proposal lodged with Council by Mr Ibrahim on behalf of Boulevarde Oasis Pty Ltd (Company). Mr Ibrahim was director and secretary of the Company.

Councillor Saravinovski disclosed that he had a ‘less than significant pecuniary interest’ in the matter (corrected before the Tribunal to be a less than significant non-pecuniary interest). His disclosure was that he, the mayor and council staff had been briefed by the Company on its proposal and also that 3 months earlier, he attended a social gathering. He said he would manage that conflict by leaving the Council chamber during consideration of and voting on the planning proposal.

The gathering referred to in the disclosure was in fact Mr Ibrahim’s engagement party (although this was not stated in the disclosure)

Councillor Saravinovski said considered his relationship with Mr Ibrahim not to be particularly close and not to constitute friendship.

However the Councillor had failed to disclose the extent of other social contact he had had with Mr Ibrahim including exchanges of social phone calls, texts and electronic messages, and social meetings on various dates between 2016 and 2021.

Relevant Findings and Implications

The Tribunal was satisfied that because of the degree of social contact with Mr Ibrahim, a reasonable and informed person would perceive that Councillor Saravinovski “could be influenced” by his relationship with Mr Ibrahim. The Tribunal held that the relationship was a disclosable private interest. having regard to the extent of social contact and the nature of the social contact, including attendance at the engagement party,

Although the Councillor had properly absented himself from the Council meeting when the matter was considered, and had made a partial disclosure, the Tribunal found the Councillor guilty of misconduct, as defined by s440F(1) of the LG Act, and formally reprimanded him pursuant to s482A(2)(b) of the LG Act, due to the failure to fully disclose the extent and nature of his private interest (and other breaches of the Code arising from the Councillor’s behaviour at various meetings).

The decision is a useful reminder for council officials to carefully consider the extent of social and other contact with persons with matters before council, in order to properly comply with the disclosure obligations under the Code.

First, the relevant interest must be disclosed fully and in writing. Given that frequency of social contact is a factor in determining whether there is a conflict and the significance of the conflict, the disclosure should include complete details of the frequency and nature of the social contact.

Secondly, the focus is not on the council official’s subjective belief as to the closeness of a personal relationship, but how an informed person would perceive the relationship and the potential impact of the relationship on the council official’s impartiality. In particular the Tribunal need only conclude that a reasonable and informed person would consider that the council official could be influenced by the private interest in order to conclude there is a conflict.

This should be considered by a council official when determining how to disclose the interest, and whether to absent themselves from the council meeting during consideration and voting on the matter.

The judgment can be found here.

If you would like to discuss any of the above, please get in touch with Megan Hawley.