Ian Cooper on behalf of North Coast Dial Inc. v. Coffs Harbour City Council




Matter: 97/232

Number of pages - 15

DATE OF HEARING: 11 February 2000



#DATE 12:05:2000


Mr Paul Batley of Legal Aid NSW appeared for the complainant

Mr Bill Langler of Murray Backhouse Turner, Solicitors appeared for the respondent

The complaint was substantiated but no relief was ordered.



On 6 April 1995 Holiday Coast Cinema Centres Pty Ltd ("the operator") lodged a development application with the respondent ("the Council") for alterations to its cinema involving an overall reduction in seating capacity from 553 to 496 patrons. Ross David Colquhoun wrote the development application. Mr Colquhoun is an architect based in Coffs Harbour who had been engaged by the operator to do certain architectural drawings. Mr Madge, the principal of the operator, signed the application. That application noted the "estimated cost" to be $100,000.00. Note 1 to the application provides that "in the case of a building or work, the fee is based on the estimate cost". The "fee" here referred to is the fee which attaches to the lodgement of the development application.

The cinema was part of an existing shopping centre and the proposed redevelopment of the cinema centre necessarily involved alterations to the host building. It will be necessary to refer in greater detail below to the evidence of Mr Colquhoun but it can be noted here that Mr Colquhoun's professional engagement was as a consultant architect engaged by the operator. The building work was at least in part the responsibility of the owner who had engaged the building contractor. Mr Colquhoun was not in any sense a supervising architect and his evidence makes clear his somewhat limited involvement in the proposed redevelopment of the cinema within the shopping centre.

It will be necessary to refer again to Mr Colquhoun's evidence concerning his having written "$100,000" in the development application as the "estimate" of the cost of development.

This proposal for the redevelopment of the cinema had been preceded by an earlier proposal for a much more extensive redevelopment and this had been the subject of discussions between Council officers. A significant part of the earlier discussions had focused on the provision of suitable access for persons with disabilities.

The plans submitted with the development application dated 6 April 1995 had made no provision for persons with disabilities.

On 13 April 1995 Ms Janice Kilbourne, the community officer engaged by the Council, submitted her report to the Manager, Development Control, in respect of the development application. Her major concern was the lack of provision for access for persons with disabilities and that this may involve a breach of the Disability Discrimination Act 1992 (Cth) ("the DDA"). Her report continues:

"...but the clause of "unjustifiable hardship" in this instance could well be applied as the entire re-development is only $100,000."

Her reference to "unjustifiable hardship" is a reference to the exclusion of unlawfulness in a case comprehended by section 23(2)(b) of the DDA.

The report of Ms Kilbourne is the first reference to the "unjustifiable hardship" issue which is at the core of the later developments in the matter.

On or about 11 May 1995 the Council approved the application subject to conditions. The Council minute notes:

"On the matter of the Commonwealth Disability Act it is reasonable under the circumstances stated in the report to confirm that the application has a fair claim for hardship in this particular circumstance".

On 7 August 1995 the complainant made complaints to the Human Rights and Equal Opportunity Commission ("the Commission") under the DDA against the operator and the Council.

The complaint against the operator was heard by Commissioner Keim on 29 August 1997. He found that the operator had unlawfully discriminated against the complainant in breach of section 23 of the DDA by failing to provide access (Cooper v Holiday Coast Cinema Centres Pty Ltd, HREOC, 29 August 1997).

On 3 December 1997 Commissioner Nettlefold inquired into the complaint against the Council and on 18 May 1998 he determined that the Council had not acted unlawfully in breach of the DDA by approving the development application without imposing a condition for the provision of disability access, by issuing the relevant Building Notice of Approval to the operator, or by permitting the operator to operate the relevant premises (Ian Cooper, President North Coast D.I.A.L. Inc. v Coffs Harbour City Council, HREOC, 18 May 1998). The complaint against the Council had alleged liability on the part of the Council by reason of section 122 of the DDA which provides as follows:

122 Liability of persons involved in unlawful acts

A person who causes, instructs, induces, aids or permits another person to do an act that is unlawful under Division 1, 2 or 3 of Part 2 is, for the purposes of this Act, taken also to have done the act.

The complaint against the Council was based on the allegation that the Council had acted unlawfully in that it had "permitted" the operator to do an act that was unlawful, namely to provide the cinema premises without the provision for access for persons with disabilities. Commissioner Nettlefold dismissed the complaint having found for reasons set out in his determination that the Council should not by operation of section 122 be "taken" to have done anything made unlawful by the DDA.

An application for the review of Commissioner Nettlefold's decision under the Administrative Decisions (Judicial Review) Act 1977 (Cth) came before Madgwick J in the Federal Court. On 4 March 1999 his Honour granted the application and remitted the matter to the Commission, differently constituted, for determination according to law.

On 11 February 2000 the further inquiry into the complaint against the Council was concluded at Coffs Harbour. Some further evidence was heard and Counsel for both parties agreed to provide written submissions by 31 March 2000.


His Honour's decision is reported at Cooper v HREOC and Coffs Harbour City Council [1999] FCA 180.

His Honour noted that the first step in establishing liability under section 122 was to establish an unlawful act on the part of the principal - in this case, the operator. This issue had been concluded by the decision of Commissioner Keim and was an agreed fact in the inquiry before Commissioner Nettlefold.

His Honour went on (at page 17) -

"It seems to me that, for the purposes of the Disability Discrimination Act, one person permits another to do an unlawful discriminatory act if he or she permits that other to do an act which is in fact discriminatory. It is not essential to the concept of permission, in this context, that the permittor should know or believe in the lack of cogency of an assertion of unjustifiable hardship, particularly having regard to the unavoidably subjective features included in such an assertion and in knowledge or belief about it."

He concluded (at page 18) -

"The consequence is that, at least in a case where the presence of such material does not positively satisfy the Commission that the supposed permittor honestly and reasonably believed that unjustifiable hardship would be involved, such material is not relevant to a conclusion on liability."

His Honour went on to hold that if the Council honestly believed on reasonable grounds that the facts were such as would constitute unjustifiable hardship on the part of the operator in accordance with the principles in Proudman v Dayman (1941) 67 CLR at pages 540-1, the Council had not acted unlawfully.

Therefore the issues for determination consequential upon the decision of Madgwick J can be summarised as follows:

(i)       Whether the Council aided or permitted an act by the operator which was in breach of section 23 of the DDA.

(ii)       Whether the Council had an honest belief at the material time that the operator had a claim for unjustifiable hardship.

(iii)       Whether that belief was based on reasonable grounds.

The Council does not dispute that by granting the development application without attaching the relevant condition for persons with disabilities it permitted the operator to do an act which was unlawful under the DDA.

The complainant does not argue that the Council "aided" the operator to breach the DDA.

The Council argues that it honestly and reasonably believed that the circumstances were such that the operator would suffer "unjustifiable hardship" if required to make the premises accessible to persons with disabilities using wheelchairs in a manner which avoided a breach of the DDA.

The complainant accepts that there is no evidence to suggest that the Council did not honestly believe that the operator was entitled to be excused from compliance with the DDA on the grounds of unjustifiable hardship.

The only question therefore is whether the Council, on whom rests the relevant onus, can establish to the satisfaction of the Commission that it had a reasonable belief in a state of things which, if true, would have excused the operator from compliance on the ground of unjustifiable hardship. This inquiry focussed solely on this issue.


Section 11 of the DDA provides -

11 Unjustifiable hardship

        For the purposes of this Act, in determining what constitutes unjustifiable hardship, all relevant circumstances of the particular case are to be taken into account including:

       (a) the nature of the benefit or detriment likely to accrue or be suffered by any persons concerned; and

       (b) the effect of the disability of a person concerned; and

       (c) the financial circumstances and the estimated amount of expenditure required to be made by the person claiming unjustifiable hardship; and

(d)       in the case of the provision of services, or the making available of facilities--an action plan given to the Commission under section 64.

Section 23(2)(b) of the DDA provides -

23       Access to premises

(2)       This section does not render it unlawful to discriminate against a person on the ground of the person's disability in relation to the provision of access to premises if:


(b)       any alteration to the premises to provide such access would impose unjustifiable hardship on the person who would have to provide that access.

Section 122 of the DDA provides -

122 Liability of persons involved in unlawful acts

A person who causes, instructs, induces, aids or permits another person to do an act that is unlawful under Division 1, 2 or 3 of Part 2 is, for the purposes of this Act, taken also to have done the act.


As pointed out previously it seems that the first mention of the issue of unjustifiable hardship in the Council documents in respect of this application was made by Ms Kilbourne in her report dated 13 April 1995. Her concern was based on the fact that the provision of access for persons with disabilities using wheel chairs may be so costly as to constitute an unjustifiable hardship given that the cost of "the entire redevelopment is only $100,000". This sum, it will be recalled, was written into the development application by Mr Colquhoun and signed by Mr Madge just seven days earlier on 6 April 1995.

There is no evidence in the relevant documentary exhibits which suggests any specific inquiry by the Council or its officers in an attempt to establish the validity of the claim by reference to the provisions of section 11 of the DDA. On 26 April 1995 the operator wrote to the Council and alleged -

*       That it was "physically impossible" to provide either a lift or a stair riser;

*       That the cost was prohibitive, namely "over $100,000";

*       That the expenditure would be uneconomic in the light of expected commercial opposition;

*       That a proposed new cinema in Bray Street would provide appropriate facilities for the disabled; and

*       The redevelopment of the cinema the subject of the application would involve a reduced seating capacity for patrons.

The evidence for the Council was given by Mark Stanley Hannon, its Corporate Liaison Officer who is a qualified health and building surveyor and who had the immediate responsibility for this development application. He had also been involved in considering the earlier 1994 proposal and took part in the discussions between Council officers, the operator and Mr Colquhoun. These discussions had taken place on the basis that the estimated cost of the 1994 proposal was $800,000.00. However when the subject application was made it was not preceded by any preliminary discussions of the kind that had occurred in 1994.

There is evidence that after the application was made Mr Hannon had a discussion with Mr Colquhoun and the operator and that this discussion had focussed on the fact that the proposal in respect of which the approval was sought did not provide for any access for persons with disabilities.

Mr Hannon had been in the employment of the Council for some years. He was well known to, and he himself well knew, professional persons in Coffs Harbour of whom Mr Colquhoun was one. Likewise he regarded the operator as a good corporate citizen in Coffs Harbour whose "bona fides" were accepted. I am satisfied that the evidence concerning the $100,000.00 estimate made by Mr Colquhoun in the application which was signed by Mr Madge was accepted by Mr Hannon and impliedly by the Council as genuine and bona fide. It was certainly accepted as such by Ms Kilbourne because her concerns about the relevance of an unjustifiable hardship claim were really based on her acceptance of the fact that the cost of "the entire development is only $100,000". It was that estimate which, I am satisfied, raised in her mind the possibility of the operator rightly claiming unjustifiable hardship in the provision of suitable access for persons with disabilities.

In my view Ms Kilbourne and Mr Hannon accepted the estimate written by Mr Colquhoun in the application. Each of them made an assumption that knowing the operator and his architect, one could fairly assume that $100,000 "was within the ball park". In the initial stages the only relevance of the estimated cost was for the assessment of the fee for the application. The figure only assumed more significance when the application fell for consideration by Ms Kilbourne. I am satisfied that these officers proceeded to assess the application on the assumption that the estimate of $100,000.00 was a genuine and bona fide estimate of the cost of the redevelopment. They were not to know that the actual cost (without the provision for access for persons with disabilities) was in fact four times that estimate. The concession by Counsel for the complainant that Mr Hannon and indeed other Council officers and the Council itself had acted honestly in accepting that estimate was properly made. The reasonableness of their so doing is the more important issue.

Mr Hannon's evidence is clear that the core issue for the Council was the disproportionate cost involved in the provision of access given that the "entire redevelopment" cost for the proposal was "only $100,000". Was it reasonable for the Council and its officers to so conclude and to make the assumptions which, I am satisfied, were made?

In analysing this issue it is necessary to turn first to the evidence of Mr Colquhoun himself.

As pointed out previously, Mr Colquhoun was engaged by the operator but on a very limited basis. During the course of the inquiry on 11 February 2000, this exchange occurred between him and Counsel for the complainant.

"Q:       Was your involvement really after having undertaken the design and the drawings of the project - then to shepherd it through the development application and the building application and then step away, leave it in the hands of the builder after that?

A:       I wouldn't even use the term that I would shepherd it through that process. I was available if I was needed but really my engagement was only up to the point of the submission of relevant applications to the Council and beyond that it was first on an ad hoc basis that I was called in as necessary."

He went on to say that he may have been required for advice "to resolve problems" but that other experts were available and consulted as required. The extent of Mr Colquhoun's involvement is best shown by his evidence that in fact he had no knowledge of what the completed costs for the redevelopment were. Referring to the drawings which he provided for the purposes of the application, he described these as "skeleton drawings" because "the job was being built as a cost-plus contract". The owner was responsible for the cost of the work that "became part of the building" and the operator "was responsible for whatever items were I guess fixtures within that that would remain in his possession". Mr Colquhoun went on to say that because of the nature of the work and no doubt because of the financial arrangements between owner and operator "it was impossible to price" the job. His evidence that he nominated the sum of $100,000.00 as the estimated cost needs to be understood in the light of his later evidence that the nature of the work, the fact that it was a cost-plus contract, and the division of financial responsibility between owner and operator meant that one could not make a valid estimate of the likely cost of development at the time of the lodgement of the development application. It was as Mr Colquhoun said "impossible to price".

Again this evidence needs to be seen in the context of other evidence involving the architect.

Attached to Mr Colquhoun's statement, which became an exhibit, is a document headed "Cinema Centre Budget" and dated 21 April 1995, two weeks subsequent to the date of the development application. It was to said to have been prepared for the operator and is described by Mr Colquhoun as "an informal budget estimate" for his client. His statement says that it was prepared for the purpose of the operator's submission to Council dated 26 April 1995. There is no evidence of it having been given to the Council.

The budget estimate included a provision for air conditioning which according to Mr Colquhoun's statement was "not considered to be subject to development approval".

In spite of the content of his statement Mr Colquhoun was less definite when questioned about the Cinema Centre Budget document. When asked about the "purpose" of the document he said that "it was really an internal thing within my office". He believes it was given to Mr Madge but "other than that it was basically for my own use". He conceded that significant and costly items were not included because "this job was complex in so far as the owner and the operator were paying for various parts of the work separately and this [meaning the budget estimate] is probably basically just the building - basically the building shell works". His reference to "the air conditioning system" in his statement is intriguing because whilst it was a necessary cost in the redevelopment it was not an item like many others which needed to be the subject of development approval. In evidence he again asserted that "he [the operator] wasn't relying on this budget for his construction work. Probably concurrently with this there was a builder engaged who was preparing the actual construction for the job." Finally when asked about the "actual cost of the redevelopment of the cinema" he said, "I can honestly say that I have no knowledge of the final cost".

The evidence of Mr Colquhoun makes clear the fact that the "estimates" of $100,000.00 (which appears in the development application) and of $167,000.00 (which is described as the cinema centre budget) both of which were drawn by the architect, are not and were not intended to provide a valid estimation of what the cost would be for the proposed redevelopment of the cinema complex which was the subject of the development application. Mr Colquhoun described his inclusion of $100,000.00 in the application as "a broad brush type budget". I am satisfied that the estimation was never a serious attempt to validly estimate the cost of the proposed development. Its inclusion was in substance a mere convenience. So too in respect of the "budget" figure of $167,000.00. This was probably nothing more than a rough working document which Mr Colquhoun prepared "basically for my own use".

This evidence reflects not only the limited and marginal involvement of Mr Colquhoun with the redevelopment project but also the fact that the intrinsic nature of the contractual and other relationships involving owner, operator, builder and architect were not defined nor intended to be defined and regulated with sufficient precision for there to have been any valid estimation done of the cost of the project which the Council had under consideration. As Mr Colquhoun said, that was "impossible".

It seems to me that in light of these facts, it was quite artificial for the Council or its officers to attempt to address the question whether the cost of providing access for persons with disabilities was "disproportionate" to the total cost. From the evidence it is clear that the views of the Council and its advisers were largely determined on the false or invalid assumption drawn from the contents of the development application and Ms Kilbourne's report that the cost of the "entire redevelopment is only $100,000.00". That was in effect the information which the Council had access to. The evidence of Mr Colquhoun makes it clear that had there been any concerted attempt by Council officers, including Mr Hannon, to obtain valid information from Mr Colquhoun or to seek verification of the estimate, that attempt must necessarily have failed. What the Council would have learned was that -

*       The owner and operator had agreed to share the financial responsibility for the total development;

*       Mr Colquhoun had a very limited engagement only in the project and could not have then given a realistic estimation of the cost;

*       The contract was in effect a cost plus contract; and

*       It was "impossible" at that stage to validly cost the proposed redevelopment.

Inquiries of the kind suggested by the above were never made. Rather Mr Hannon relied on his own judgement, made on the basis of inadequate information, that the estimate of $100,000.00 was "within the ball park".


I return then to the fundamental issue, namely whether the Council had reasonable grounds for its admittedly honest belief that the applicant for development approval could validly claim unjustifiable hardship pursuant to section 23(2)(b) of the DDA on the basis that the cost of providing access for persons with disabilities to the cinema was disproportionate to the cost of development.

As pointed out earlier one can easily be satisfied by the evidence that having rightly identified the relevance of the unjustifiable hardship issue in the context of this application, the Council then accepted as valid the stated estimate in the application document on the assumption that the operator and its architect were persons of bona fides and because in Mr Hannon's view the stated estimate was "within the ball park". Clearly no further inquiries were made or more valid estimates sought, not only in relation to the cost of the project but also in respect of an acceptable means of access including all of the "financial circumstances" which were relevant to a claim for unjustifiable hardship.

Was it sufficient in the context of this case for the Council to do only what it did if it was to avoid a finding of unlawfulness on the basis that the operator could properly claim relief under the DDA on the ground of unjustifiable hardship? It could only do that if it reasonably believed that the relevant cost was disproportionate and that other factors supported a valid claim by the operator for relief. Was the test of reasonableness of belief satisfied by the Council's mere reliance on the contents of the application, its knowledge of the persons involved, the submissions of the operator, its own officer's assessment that the estimated figure was "within the ball park", and its own perceptions of the difficulty for the operator in attempting to comply with the DDA?

In addressing this question matters of principle arise.

Prima facie, in permitting the development to proceed without access for persons with disabilities, the Council was about to act unlawfully and in breach of the DDA. It could only avoid such a finding on the basis of an honest and reasonable belief that the operator could properly claim unjustifiable hardship if account were taken of "all relevant circumstances of the particular case" (section 11 of the DDA). One such circumstance was "the financial circumstances and the estimated amount of expenditure required to be made by the person claiming unjustifiable hardship" (section 11(c) of the DDA). In short it had to convert a potentially unlawful situation to one which could withstand scrutiny.

In this the onus lay on the Council. Its fundamental obligation was to reasonably inform itself of the relevant facts upon which to found its belief.

The time frame within which this matter was dealt with by the Council was relatively brief. The development application was received on 7 April 1995. The Council decided the matter at its meeting on 11 May 1995. If the Council was to avoid a finding of unlawfulness it would have had to establish that by 11 May 1995 its honest belief that the operator could validly claim unjustifiable hardship was reasonably based.

In my view the Council cannot in this case satisfy that onus to which it was subject by relying only on what it did. The need for proper inquiry and investigation was fundamental. The proposal for redevelopment had been mooted in the previous year. The anticipated cost had been reduced from $800,000.00 to $100,000.00. Yet the very nature of the works proposed by the 1995 application remained substantial and were likely to be costly. An inquisitorial process by the Council was, in my view, of the essence. Prima facie, its decision on 11 May 1995 was potentially unlawful. The means of avoiding that liability was available to it. Inquiry sufficient to establish facts which would reasonably support a valid conclusion was a pre-requisite. In fact it did little or nothing. What it did was insufficient to satisfy the onus to which it was subject. Had it made proper inquiries these would have revealed how fragile were the assumptions which had been made.

To convert a potential finding of unlawfulness to one that it had not acted unlawfully required much more than its mere acceptance of the content of the application, the assumptions which it made about the persons involved, the likely cost of the required access and its impact on the developer's financial position. In fact it made no significant or relevant inquiry. The circumstances of the case required it, if it was to be in a position of avoiding the serious finding of unlawfulness, to at least engage Mr Colquhoun in substantial discussions about the project, what it involved, the cost of it, and the difficulties or otherwise in complying with the DDA requirements. An investigation by it of "all relevant circumstances of the case", to the extent that that involved Mr Colquhoun, would have immediately revealed that the assumptions upon which it had initially proceeded were wrong or at least subject to significant doubt. Such a basic inquiry would have alerted the relevant Council officers that their assumptions made so far were probably not sound.

For there to have been an honest and reasonable basis for a belief that the operator could itself have avoided unlawfulness on the unjustifiable hardship ground further inquiry was essential. The nature and extent of such further inquiry will reasonably be determined by the circumstances of the case. In this case inquiry made of the operator, the owner of the shopping centre, the builder and Mr Colquhoun would have revealed not only the complexity of the works but also the relevant contractual arrangements and that, in Mr Colquhoun's terms, the job was impossible to price. That would have been sufficient to alert Mr Hannon that the "ball park" was perhaps more extensive than his earlier somewhat superficial assessment would have provided. In that case it may have required advice from a person with qualifications such as those possessed by Mr Knappick, a quantity surveyor who gave evidence for the complainant.

It has to be emphasised that much more was at stake for the Council than having a sounder basis for assessing the relevant development application fee or a more reliable statistic. It was in the position of having to do all that was reasonable in properly informing its belief that the operator could avoid liability under the DDA by failing to provide access to persons with disabilities. What was at stake for the Council was the avoidance of a finding of unlawfulness to which it was potentially and prima facie subject because it had permitted the operator to proceed with its development without providing suitable access to persons with disabilities. Therefore the Council on that account had to do all that was necessary to ensure on its part the integrity of an honest and reasonable belief that the operator could avoid liability under the DDA.

The circumstances of each case will determine whether a Council has discharged the relevant onus. Nor can one define the requirements for each individual case other than to emphasise that given the nature of the onus to which it is subject, the Council must do all that will enable it to avoid the prima facie finding of unlawfulness consequential upon its permitting a development which is in breach of the DDA.

The opinion evidence of Mr Knappick is relevant not only because of its content but also to the extent that it demonstrates that professional opinion is available which can properly and validly demonstrate that the Council may otherwise be led to a wrong result and which can easily assist it in determining whether its assumptions are likely to mislead it to the point that it cannot avoid a finding of unlawfulness. The matters referred to in Mr Knappick's report which prima facie demonstrate the unreliability of the information on which the Council proposed to act is easily understood by a person of average intelligence and experience.

It was essential for the Council to make the necessary inquiries. In this case the concern must be that the Council did little if anything to properly inform itself of the relevant matters so that its belief could be supported on reasonable grounds.

In my view what it did was not sufficient to discharge the onus to which it was subject. It therefore cannot properly claim that its belief in respect of the operator's liability under the DDA was an honest and reasonable one.


It follows that the complaint against the Council has been substantiated in that in terms of section 122, it permitted the development without requiring compliance with the access requirements of the DDA.

6.       RELIEF

Section 103 of the DDA catalogues the powers of the Commission after inquiry. It was submitted, inter alia, by the complainant that because of its breach of the DDA the Council should be ordered to make a public apology to the complainant and to those whom he was representing and further that monetary compensation should be ordered.

In my view neither form of relief is appropriate in this case. The Council clearly identified the relevant issue which it had to consider and it is accepted that the relevant belief concerning the operator's position was honestly held by the Council. It fails in its defence because of the reasonableness issue. In those circumstances the only appropriate relief is to declare pursuant to section 103(1)(b)(i) of the DDA that the complaint against the Council has been substantiated and that the Council in approving the application permitted a breach of the DDA by the operator and that in so doing its act was unlawful.


Hon William Carter QC

Inquiry Commissioner