Posted on May 22, 2014 by
Tribunal Overturns Suspension of Councillor
A Marrickville councillor who was suspended for two months by the Director-General of the Division of Local Government (DG) for engaging in misconduct has succeeded in having the suspension overturned in the NSW Civil and Administrative Tribunal (Tribunal).
Councillor Phillips was suspended by the DG for misconduct under the Local Government Act 1993 (LG Act) on the basis that he breached the Council’s Code of Conduct (Code) by failing to act in accordance with a Council resolution requiring him to ‘unreservedly apologise’. Council’s resolution followed the report of a Conduct Reviewer (Reviewer) into complaints that the councillor disclosed confidential information.
The information concerned an offer by a developer, initially made at a briefing session of councillors, to enter into a voluntary planning agreement (VPA) to contribute $5m to Council if it supported increased density for a development site. The proposal later came before Council’s Development Assessment Committee (Committee) on the basis that it was a confidential agenda item.
Councillor Phillips, believing transparency to be necessary, had publicised the developer’s proposal, but had only made public information that had been presented at the briefing session.
The Reviewer found that it was difficult to conclude that it was properly communicated to councillors that the briefing session was confidential, observing that council had limited experience in dealing with VPA offers and had not developed any precedent as to the procedures to be followed, including as to confidentiality.
The Reviewer concluded that Councillor Phillips had breached the Code by releasing council information otherwise in accordance with council policies and procedures, that he be censured for misbehaviour and be required to apologise to Council and the developer.
The DLG subsequently conducted an investigation, the result of which was that Councillor Phillips was suspended for a period of two months. Councillor Phillips appealed the decision to the Tribunal under s440L of the LG Act.
Councillor Phillips argued that he could not be required to apologise unreservedly because to do so would be contrary to s439(1) of the LG Act, which requires him to act honestly. The Tribunal rejected this argument, stating that ‘[t]he scheme of the Act does not contemplate that a councillor can be absolved from a finding of misconduct arising from a breach of the Code of Conduct because of a strongly held ethical belief’.
However, the Tribunal expressed some doubt as to whether council had the power to require Councillor Phillips to apologise ‘unreservedly’, when the Code specified the sanction of requiring a councillor ‘to apologise’. The Tribunal stated that ‘[t]he wording of the Code would recognise as appropriate an apology given in recognition of the Council’s resolution where the councillor nevertheless protested innocence or disagreement with the sanction while bowing to the terms of the resolution.’
Councillor Phillips also argued that he had not breached the Code because he had not disclosed ‘confidential information’. The DG submitted that s440L only required the Tribunal to be concerned with whether Councillor Phillips had complied with the resolution.
The Tribunal rejected this argument, concluding that an appeal under s440L of the LG Act may deal with the underlying conduct that led to the disciplinary action and that ‘the Director-General must be satisfied that there has been misconduct in the entire behaviour of a counsellor justifying a disciplinary response’. The DG could not assume that the initial misconduct was made out and simply deal with the allegation that the councillor had engaged in misconduct for refusing to apologise.
The Tribunal went on to hold that Councillor Phillips had not breached the Code by disclosing confidential information. The information ‘had never been rendered confidential by council resolution and …there was an absence of practices or procedures whereby councillors would know or expect the information to be confidential…’.
In the event that the proper role for the Tribunal was only to consider the penalty imposed, the Tribunal considered that a reprimand would be appropriate.
A number of implications flow from the Tribunal’s decision. If a council official is charged with breaches of the Code concerning disclosure of confidential information, it will usually be necessary to establish that the information was or was intended to be confidential by reference to council’s adopted policies and procedures, which may be of particular importance in the context of dealing with VPAs. The Tribunal noted that any such policies would ‘need to find a balance between preserving the transparency of council business and ensuring legitimate claims to commercial confidentiality as defined in the Act’.
The Tribunal pointed out that if council is to consider a business item on a confidential basis, the wishes of an interested party to the agenda item that it be treated confidentially will not in and of itself be sufficient to establish confidentiality. Council will always need to make an assessment having regard to the nature of the material and the requirements of ss10A, 10B and 10D of the LG Act.
Finally, in an appeal under s440L of the LG Act, the Tribunal will not be confined to just considering the appropriate penalty but may also consider whether breaches of the Code giving rise to misconduct are in fact established. This could also put an additional onus on the DG when investigating matters under s440H of the LG Act. However, as the Tribunal pointed out, under s440M(1) of the Act, the DG can recover from council reasonable expenses incurred in the conduct of an investigation into a councillor conducted under that division of the Act.