Council Amalgamation Litigation Continues

As many residents of the Shellharbour and Wollongong regions will be aware, the Minister for Local Government has the power to amalgamate local councils. This power has recently been exercised to amalgamate various councils, including Shellharbour City Council (SCC) and Wollongong City Council.

On 12 May 2016, SCC successfully applied to the Land and Environment Court for an injunction restraining the implementation of the proposed council merger. Unfortunately for SCC this relief was only temporary with the Court finding against SCC on 20 September 2016.

SCC was arguing that the Minister’s decision should be overturned on a number of bases including that:

• there was a failure to provide reasonable notice of the venues where the inquiries were to be held, the Club names only being advertised rather than their complete address;
• there was a failure to properly consider the inequitable redistribution of development benefits being reaped from a development in Shell Cove;
• SCC had invested significant capital expenditure on the new Shellharbour Civic Centre; and
• the analysis and modelling provided to the Minister by KPMG should have been publically released to enable an opportunity to respond.

The Court held that the Minister’s decision should be upheld as SCC had failed to show that the Delegate’s decision was manifestly unreasonable or there was any denial of procedural fairness. The Court also held that SCC is to pay the costs of the Minister for the litigation.

SCC has announced they will appeal the decision to the Court of Appeal, meaning Shellharbour and Wollongong region residents will have to wait a while longer for a final decision.

Shellharbour was not alone in appealing against the various proposed council mergers. A Supreme Court decision has recently been handed down in Botany Bay City Council v The State of New South Wales and Minister for Local Government [2016] NSWSC 583.

In this case Botany Bay Council was objecting to its merger with the Rockdale City Council on the basis that the Minister had failed to take into account the attitudes of residents of the area and that alternative merger proposals were not considered. The Court found against Botany Bay on both submissions. Botany Bay resolved not to appeal the decision and has now been merged with Rockdale City Council form the new “Bayside Council”.

The nature and content of SCC’s appeal remains to be seen however undoubtedly Botany Bay’s eventual demise does not bode well for those against the Wollongong-Shellharbour amalgamation.