Australian Blue Metal Ltd v Penrith Corporation [1963] HCA 2; (1963) 110 CLR 102 (7 March 1963)

HIGH COURT OF AUSTRALIA

AUSTRALIAN BLUE METAL LTD. v. PENRITH CORPORATION [1963] HCA 2; (1963) 110 CLR 102

Local Government (N.S.W.)

High Court of Australia
Dixon C.J.(1), Kitto(2), Taylor(3), Windeyer(4) and Owen(5) JJ.

CATCHWORDS

Local Government (N.S.W.) - Action by municipal council to recover amounts for electricity supplied - County council substituted for municipal council - Application for perpetual stay of action - Whether debt transferred from municipal council to county council - Discretion to allow amendment outside period of limitation - Effect of proclamation - Whether action pending at suit of municipal council or county council - Local Government Act, 1919 (N.S.W.), s. 564 (3A) - Local Government (Amendment) Act, 1959, s. 8 - Proclamation of 9th December 1959 (N.S.W. Government Gazette No. 146, 18th December 1959, p. 3877).

HEARING

Sydney, 1962, April 16, 17;
Melbourne, 1963, March 7. 7:3:1963
APPEAL from the Supreme Court of New South Wales.

DECISION

1963, March 7.
The following written judgments were delivered:-
DIXON C.J. This action was instituted on 28th March 1958 by a writ of sued under that corporate name by the Council of the Municipality of Penrith as plaintiff. The endorsement upon the writ shows the particulars of the plaintiff's claim as follows: "To balance of amount payable by the defendant to the plaintiff for electricity supplied by the pliantiff to the defendant from 1st March 1952 to 3rd January 1957, . . . 11,860 pounds 6s. 0d." (at p105)

2. The declaration contained six counts. By the first the plaintiff, the Council of the Municipality of Penrith, alleged that from and including 1st March 1952 to and including 31st July 1952 the plaintiff municipality supplied electricity to the appellant defendant in respect of which the total amount of the charges was 2,576 pounds 6s. 6d. and of that sum the defendant had paid to the plaintiff 1,762 pounds 19s. 11d. only, the balance of 813 pounds 6s. 7d. being unpaid and due and owing by the defendant to the plaintiff. This count contained an allegation that no ordinance had been issued at the time of supply under the provisions of the Local Government Act (N.S.W.) fixing the charge or the maximum charge to be made for such electricity and that the defendant had used electricity in a process of manufacture to operate electrical apparatus connected with the plaintiff's electricity system and having a rating therein set out. The count further alleged that the plaintiff Council had duly resolved on certain rates of charge before the supply of the said electricity. (at p106)

3. The second count took the same form as the first count and claimed in respect of the same sum accruing between the same dates but the count varied from the first count in alleging, not that the defendant used the electricity in a process of manufacture to operate and so on, but used the electricity in a process similar to a process of manufacture which process in the opinion of the Chief Electrical Engineer fell within the same category and so on. (at p106)

4. The third count related to electricity supplied in the period commencing on 1st August 1952 and ending on 30th June 1953 for which the total amount of charges was alleged to be 3,894 pounds 4s. 6d., of which sum the defendant had paid the plaintiff the sum of 3,287 pounds 8s. 0d. only, the balance of 606 pounds 16s. 6d. being still unpaid; that sum was claimed in the count. (at p106)

5. The fourth count claimed the same sum; the count varied from the third count in the same manner as the second count varied from the first count. (at p106)

6. The fifth count related to the period from 1st July 1953 to 3rd January 1957 and was in respect of the total amount of the charges during that period of 30,406 pounds 1s. 11d., and alleged that of that sum 19,965 pounds 19s. 0d. only had been paid and that the balance of 10,444 pounds 2s. 11d. was still unpaid, due and owing. (at p106)

7. The sixth count was in respect of the same period and the same sum and varied from the fifth only in the same manner as the second and fourth counts varied respectively from the first and third counts. (at p106)

8. The total of the sums claimed in the six counts was the same as that claimed in the particulars in the writ of summons, viz. 11,860 pounds 6s. 0d. (at p107)

9. These counts simply form the background of the difficulties which provide the subject of the present appeal. A short narrative of the course taken in the action is necessary to explain them. (at p107)

10. On 13th November 1958 the defendant applied to a judge in chambers by summons which as amended, or perhaps one should say, as ordered to be amended, sought orders: (a) that all further proceedings on the first, second, third and fourth counts be stayed pending an appeal from a certain chamber order made on 27th October 1958 but not now material (an appeal which was subsequently dismissed on 23rd April 1959); the chamber order was to the effect that the plaintiff might substitute six counts for three contained in its declaration; (b) that the cause be entered in the Commercial Causes list for trial without a jury; (c) that certain particulars be given; (d) that the time for filing pleas without verification be extended; (e) that certain other orders not now material be made and, lastly, (f) that there be a perpetual stay of the action. Correspondence between the solicitors for the respective parties ensued and that went on until 6th August 1959. The correspondence related to the discovery and inspection of documents and the application already mentioned to have the matter treated as a commercial cause and that the particulars be given. Three further writs of summons were issued in 1957 claiming electricity charges. The correspondence related to pleas in those actions and in the present action. (at p107)

11. It is not material to the present proceedings to go into the actual defences to the claims but it appears that they depended upon the manner in which the rates of charge or charges were alleged to have been fixed. (at p107)

12. In the meantime, by a proclamation of 3rd October 1956, gazetted on 12th October 1956, a county district for local government was constituted under the name of Prospect County District. It was constituted of parts of the City of Parramatta, of the Municipalities of Baulkham Hills, Fairfield, Holroyd and Blacktown. Further, a proclamation was gazetted on 13th November 1959 proclaiming the Municipality of Penrith as the City of Penrith. By Gazette No. 117 of 21st November 1958 another proclamation had been gazetted which added thereto the whole of the Liverpool, Penrith and Windsor municipalities and the whole of the Colo Shire. In his judgment in the Full Court Brereton J. gives a narrative with respect to this proclamation which states the effect of a material provision of the document and shows what occurred. It is convenient to set out what his Honour said: "The proclamation further purported to transfer to the Prospect County district the functions of the Penrith Council in relation to works for the supply of electricity and property held by it in connexion therewith. It was held, however, by Myers J. in Penrith Municipal Council v. Prospect County Council (1959) 5 LGRA 205 that although the extension of the boundaries was valid, the transfer of functions and property was not, so that after 21st November 1958 whether or not the Prospect County Council was entitled to extend its own undertaking into the Penrith area the right of the Penrith Council to carry on its own undertaking and to any property held in connexion therewith remained unaffected. The Local Government Act, 1919 was then further amended and the amendment was assented to on 6th November 1959. The reason for the partial invalidity of the proclamation of 21st November 1958 was that for the transfer of functions and property the assent of the Councils concerned was necessary under s. 564 of the Local Government Act as it then stood and no such assent had been given. The amendment sought to overcome this in the instant case and for the future by (i) introducing a new s. 561A establishing a new procedure for the alteration of boundaries of county districts, (ii) by adding to s. 564 a new sub-s. (3A) which provided that upon the alteration of boundaries by the addition of an area the functions which the County Council had in respect of its original area should be deemed to have been delegated in respect of the additional area, (iii) by adding a new s. 564BA enabling the Governor by proclamation to provide inter alia for the transfer of property and of . . . suits, actions and proceedings'. Further by s. 8 (2) of the amending Act (i) past alterations of boundaries were validated, (ii) anything done consequential upon such alterations was validated with the exception of the invalidated provisions of the proclamation of 21st November 1958, (iii) the Governor was empowered to make a proclamation under s. 564BA in relation to the Prospect County district and as from the day such proclamation took effect s. 564 (3A) was to take effect as though the alteration of boundaries took place on that date. A new proclamation was duly published on 18th December 1959 by virtue of which - 1. Prospect County Council was 'substituted' for the Council of the City of Penrith (the status of city having been recently acquired) so as to enable the County Council to exercise and enforce on its own behalf any right or power formerly exercised by the Penrith Council in relation to works for the supply of electricity and the supply and installing of electrical fittings and appliances. 2. All real and personal property and all right and interest therein and all management and control of any land or thing which immediately before the material date was vested in or belonged to the said Council and was held in connexion with such works was vested in and belonged to the County Council, and there followed detailed subsidiary provisions. In Liverpool Municipal Council v. Prospect County Council (1960) 5 LGRA 214 , this proclamation was considered (Liverpool Council being equally concerned with Penrith Council in the enlargement of the Prospect County Council's boundaries). Else-Mitchell J. held that the first clause was invalid but that the rest of the proclamation was severable and valid. The invalidity of the first clause was of no significance for his purposes because by virtue of s. 8(2)(c) of the amending Act and therefore of s. 564 (3A) of the principal Act the transfer of powers to which the transfer of property was ancillary was accomplished by the act of making a proclamation otherwise valid under s. 564BA. It may be noticed immediately, however, that the ambit and effect of s. 564 (3A) are stated in substantially different terms from those used in the invalidated clause. The latter purported to substitute the Prospect County Council for the Penrith Council so as to enable the County Council to do what the Penrith Council had been able to do 'in relation to works for the supply of electricity . . . '. The former deemed to be delegated to the Prospect County Council all the powers which it was itself able to exercise in relation to its original area" (1961) 7 LGRA 215, at pp 218-220 . (at p109)

13. By the proclamation of 9th December 1959, gazetted on 18th December 1959, the change on which this appeal turns was made, and what no doubt were now valid orders were made in pursuance of the Local Government Act, 1919-1959. It was ordered that on and from 1st January 1960 (1960) 5 LGRA 214 the Prospect County Council should be substituted for the Council of the City of Penrith and the other Councils mentioned so as to enable the County Council to exercise or enforce on its own behalf any right or power formerly exercised by the Councils in relation to works for the supply of electricity and the supply and installing of electrical fittings and appliances. (2) It was thereby ordered too that (as and from the same date) all real and personal property and all right and interest therein and all management and control of any land or thing which immediately before the material date was vested in or belonged to the said Councils and was held in connexion with such works should vest in and belong to the County Council. It was ordered (3) that all rates, moneys, liquidated and unliquidated claims which immediately before the material date were payable to or recoverable by any of the said Councils in relation to such works should be rates, moneys, liquidated and unliquidated claims payable to or recoverable by the County Council. (4) It was ordered that all suits, actions, and proceedings pending immediately before the material date at the suit of any of the said Councils in relation to any matter or claim in relation to such works shall respectively be suits, actions, and proceedings pending at the suit of the County Council. Paragraphs (5) and (6) and ensuing paragraphs deal with incidental matters. (at p110)

14. Eventually the summons in chambers dated 13th November 1958 was brought on before Walsh J. who delivered judgment on 29th June 1960. His Honour decided that the application for stay of the action should be refused; that the action had become an action under the proclamation pending at the suit of the Prospect County Council which should be entered in the list of Commercial Causes and tried by a judge without a jury and he made further orders relating to the filing of pleas and pleadings and discovery and inspection of documents and costs. From that order there was an appeal to the Full Court of the Supreme Court. It was dismissed on 13th December 1961. (at p110)

15. The application for a perpetual stay of the action was made on the ground that as a result of the foregoing proclamation as and from 1st January 1960 the cause or causes of action on which the plaintiff, the Penrith Municipality or City, sued had passed from it, so that the action could no longer be maintained by the plaintiff. Apparently it was considered to raise a situation better dealt with by an application to stay than a plea puis darrein. The jurisdiction to stay existed and might be used in curious or anomalous situations; see Tidd's Practice, ch. XIX. But if the action could no longer be maintained by the Penrith Municipality it might well be thought to follow that the cause or causes of action had passed to the Prospect County Council. If so, said the defendant Company, nevertheless the Prospect County Council could not institute or maintain a new action because since the accrual of the cause of action (i.e. to the Penrith Municipality) the period of time for the limitation of actions had run out - a period of six years: see s. 615 of the Local Government Act, 1919, as amended. This argument seems untenable. For it would seem that either the existing action passed under the operation of statute from the Penrith Council to the Prospect County Council and could be continued or else that the basic contention was wrong and the cause of action did not pass in such a way that it could only be prosecuted as a new cause of action and by a new writ. It is contended that the language of the proclamation substituting the Prospect County Council for the Council of the City of Penrith in cl. (1) refers only to the exercise of powers in the future. The provision in cl. (4) that all suits, actions and proceedings pending immediately before the material date at the suit of any of the said Councils in relation to any matter or claim in relation to such works shall respectively be suits, actions and proceedings pending at the suit of the County Council is of course relied upon. In a sense each side relies upon it. The defendant appellant says that the suit cannot go on in the name of the Council of the Municipality of Penrith because it becomes a suit pending at the suit of the County Council. The respondent, the Council of the Municipality of Penrith, says that it is not a suit in relation to any matter or claim in relation to such works. It is not necessary to examine in detail this argument which affects cl. (8) and indeed other clauses less relevant. The argument depends upon giving a narrow meaning to "works". To some extent it also depends upon the fact that the supply of electricity seems to have been a supply of electricity obtained from some outside and more general supply. In other words, the electricity supplied to the consumer was merely transmitted and not created by the County Council. The details supporting this contention are not worked out and one would presume that the electricity purchased or otherwise acquired by the County Council would be of a voltage which needed to be broken down by a transformer before being transmitted to the consumer. That might mean that on the narrowest meaning of "works" the transformer was included. However, an examination of the Local Government Act suggests that "works" is not used in such a manner (see ss. 564 B (1)(a)(b)(c)(g)(h)(i)(ja) and (m): 641: 642). If one considers cl. (4) of the proclamation closely it appears clearly enough from it that the suits, actions and proceedings pending immediately before the material date at the suit of the Councils are comprised within it and that must mean suits, actions and proceedings upon causes of action and the like which have not passed into judgments or orders but are still being pursued. They are to go on pending although at the suit of the County Council. The suits, actions and proceedings comprised within cl. (4) are to be suits, actions and proceedings in relation to any matter or claim in relation to such works. It seems obvious that they must in some way grow out of or pertain to the operations of works in the past. The inference would appear to me to be that causes of action vested in the Municipal Council as the result or as a consequence of the operation of works in the past should now vest in the County Council and suits, actions and proceedings of that kind are to pend at the suit of the County Council. If the action is to pend at the suit of the County Council and the fruits, if any, of the action are to belong to it, the almost necessary inference would seem to be that the new plaintiff at whose suit the proceedings are now pending may (by amendment) be placed upon the record and indeed that the statute intends that that should be done. I see no reason why the general doctrine should apply that an amendment ought not to be made in parties if the amendment would overcome the operation of a statute of limitations. We are concerned here with a statute which affects a transfer of a chose in action and of the proceedings which happen to be pending to enforce it. All the amendment does is to put on the record of the court a change of parties necessary to give formal effect to the statute. (at p112)

16. I think the appeal should be dismissed. (at p112)

KITTO J. In the Supreme Court, Walsh J. refused an application for a perpetual stay of an action then pending in that Court against the appellant at the suit of a plaintiff described on the record as the Council of the Municipality of Penrith, and he held that the action had become an action pending at the suit of the Prospect County Council. The Full Court on appeal affirmed the refusal of a stay, but by majority struck out that portion of the order of Walsh J. by which the action was declared to be pending at the suit of the Prospect County Council. (at p112)

2. The difference of opinion among the learned Judges of the Supreme Court concerned the meaning and effect of a proclamation published in the New South Wales Government Gazette on 18th December 1959. The statutory basis of the proclamation is to be found in s. 8(2)(c), as read with s. 8(1) (f), of the Local Government (Amendment) Act, 1959 (N.S.W.). Nothing turns on the text of those provisions: all that need be said of them is that they gave the force of law to the proclamation in all material respects. (at p112)

3. The proclamation ordered that on and from 1st January 1960 the Prospect County Council should be substituted for certain other councils including the Council of the City of Penrith (as the Council of the Municipality of Penrith is now called), so as to enable the Prospect County Council to exercise and enforce on its own behalf any right or power formerly exercised by the other councils "in relation to works for the supply of electricity" and certain other subjects; it vested in the Prospect County Council all property which immediately before the said date was vested in the other councils and was held "in connexion with such works", made all moneys and claims payable to or recoverable by any of the other Councils "in relation to such works" payable to or recoverable by the Prospect County Council, and provided that all suits, actions, and proceedings pending at the said date at the suit of any of the other councils in relation to any matter or claim "in relation to such works" should be suits, actions, and proceedings pending at the suit of the Prospect County Council. (at p113)

4. The action was for debt for electricity supplied by the Penrith Council to the appellant. If such a debt was, within the meaning of the proclamation, a debt in relation to the Penrith Council's "works for the supply of electricity", the proclamation operated upon it and upon the action, vesting the debt sued for (if owing) in the Prospect County Council and making the action an action pending at the suit of the latter Council notwithstanding that the Penrith Council continued to be named as the plaintiff on the record. If, on the other hand, such a debt was not in relation to the Penrith Council's "works for the supply of electricity" the proclamation had no operation relevant to the action. In the Supreme Court, Walsh and Macfarlan JJ. interpreted the expression "works for the supply of electricity", in relation to the Penrith Council, as comprising the whole of that Council's electricity undertaking, and consequently held that the debt was in relation to those "works". Herron and Brereton JJ., on the other hand, interpreted the expression as referring only to physical things constructed for the supply of electricity and therefore as not including the supply of electricity itself; and accordingly they held that the debt sued for was not affected by the proclamation. (at p113)

5. If I have understood the appellant's case correctly it consists of alternative arguments. One argument is that the debt sued for (if owing) was transferred by the proclamation to the Prospect County Council, and that while for that reason the action cannot succeed at the suit of the Penrith Council it yet cannot, consistently with accepted principle, be converted by amendment into an action in the name of the Prospect County Council, since part at least of the debt (if owing) is statute-barred and to allow the amendment would be tantamount to allowing a new action to be brought out of time. Thus, the appellant contends, the proclamation has made the action no longer maintainable, and a perpetual stay should therefore be ordered. (at p113)

6. It will be observed that the contention depends upon an assumption, namely that the operation which the provision of the proclamation as to pending proceedings had in respect of an action by the Penrith Council to which it applied was to entitle the Prospect County Council to be substituted for the Penrith Council as plaintiff by leave of the court in which the action was pending. Only if that were its operation could there be a foundation for an appeal to the principle which forbids an exercise of discretion to allow amendment if the effect would be to defeat an accrued defence under the statutes of limitation. In my opinion the assumption is erroneous and the argument therefore breaks down at the threshold. The provision is expressed in clear and precise terms. The actions to which it applies "shall be" actions pending at the suit of the Prospect County Council. No judicial action is required. The court has not to exercise a discretion. Every subject action is, by force of the Act operating upon the proclamation, turned at once into an action pending at the suit of the Prospect County Council. There is nothing to prevent an amendment of the record in order that the change may be conveniently reflected, but the change did not depend upon the allowing of an amendment: it occurred upon the taking effect of the proclamation, and the Prospect County Council thereupon became entitled to prosecute the action as if it had been the plaintiff from the beginning, even though the Penrith Council's name continued to appear as the name of the plaintiff on the record. This is the literal meaning of the provision as to pending actions, and there is no reason to seek for another. The appellant's interpretation of it renders it otiose, allowing the proclamation as a whole no greater effect in respect of pending actions that would have been produced if it had stopped after making all moneys and claims in relation to the electricity works payable to or recoverable by the Penrith Council payable to or recoverable by the Prospect County Council. The manifest object of the added provision was to convert all the subject proceedings uno ictu into proceedings by the Prospect County Council, instead of leaving the situation such that in each proceeding an amendment would have to be made or other procedural step taken to effect a change of plaintiff or other prosecuting party. (at p114)

7. The argument which I have so far left on one side, in the forefront of the appellant's submissions though it was, took as its starting point a contention that the debt here sued for (if owing) was transferred to the Prospect County Council not by the proclamation of 18th December 1959 but by the operation of sub-s. (3A) of s. 564 of the Local Government Act, 1919-1959, a provision which was enacted by s. 8(1)(e) of the Local Government (Amended) Act, 1959. The sub-section, as applying to a case like the present where the boundaries of a county district are altered by adding thereto a part of a municipality, provides that the council of the county district as so altered shall have and may exercise in respect of the county district as so altered all the functions, powers and duties which it had and was entitled to exercise in respect of the county district immediately before the alteration; and it adds that such functions, powers and duties shall, as on and from the date specified in that behalf in the proclamation altering the boundaries of the county district, be deemed to have been delegated to the county council in respect of the area or part added to the county district. The first step in the argument depends upon treating a right to sue for an accrued debt as one of the "powers" referred to in this provision. My reason for putting the argument aside is that it seems altogether too clear that the word refers to general corporate capacities and authorities, and does not include a right to enforce a chose in action. (at p115)

8. Accordingly I am of opinion that the action is pending either at the suit of the Prospect County Council or at the suit of the Penrith Council, according as the proclamation did or did not apply to it, and that since it may be prosecuted by the one Council or the other the application for a stay of proceedings was rightly refused. (at p115)

9. On the view of the matter which I have expressed, the question whether the proclamation applies to this action does not arise for decision in this appeal. It is a matter primarily between the Penrith Council on the one hand and the Prospect County Council on the other; and since they are not here represented separately from one another - indeed the learned counsel who appeared to oppose the appeal were content to be considered as appearing for whichever of the two bodies was entitled to prosecute the action - we are not in a position to adjudicate between them. (at p115)

10. I would dismiss the appeal. (at p115)

TAYLOR J. On 28th March 1958 the respondent caused a writ to be issued out of the Supreme Court of New South Wales for the recovery of an amount of 11,860 pounds 6s. 0d. which was alleged to be owing to it by the appellant for electricity supplied between 1st March 1952 and 3rd January 1957. A declaration was filed on 24th April 1958 which, subsequently, was amended by leave, the respondent survived an appeal against the order granting such leave and, thereafter, an application was heard by Walsh J. wherein the defendant sought an order for the perpetual stay of the action. The development which led to this application was the publication in the New South Wales Government Gazette of 21st November 1958 of a proclamation which purported to add to the Prospect County District the whole of the Liverpool, Penrith and Windsor municipalities. The history of the matter and of certain later relevant legislative steps are traced both in the reasons published by Walsh J. when he dismissed the appellant's application and those of Brereton J. on appeal and it is unnecessary to restate these matters at length. But it is of importance to set out the provisions of sub-s. (3A) of s. 564 of the Local Government Act (N.S.W.) which was introduced into the principal Act by the Local Government (Amendment) Act, 1959 (N.S.W.) and which came into operation on 6th November 1959. That provision was in the following form: "(3A) Where the boundaries of a county district are altered by adding thereto any area or part of an area, the council of the county district as so altered shall have and may exercise in respect of the county district as so altered all the functions, powers and duties which it had and was entitled to exercise in respect of the county district immediately before the alteration, and such functions, powers and duties shall, as on and from the date specified in that behalf in the proclamation altering the boundaries of the county district, be deemed to have been delegated to the county council in respect of the area or part added to the county district. Such delegation shall be deemed to have been made as on and from the date so specified by the proclamation altering the boundaries of the county district". By sub-s. (2) (a) of s. 8 of the amending Act where, before the commencement of the Act, county districts had been altered by including therein wholes or parts of areas or county districts had been united to constitute new county districts all such alterations and unions were to be deemed to have been and to be valid and in accordance with the law. Shortly afterwards, on 9th December 1959, a proclamation was made by the Governor which ordered, inter alia, that all rates, moneys, liquidated and unliquidated claims which immediately before the material date (i.e. 1st January 1960) were payable to or recoverable by the Council of the City of Penrith in relation to "such works" should be rates, moneys, liquidated and unliquidated claims payable to or recoverable by the County Council (par. 3) and, further, that all suits, actions and proceedings pending immediately before the material date at the suit of the said Penrith Council in relation to any matter or claim in relation to "such works" should respectively be suits, actions and proceedings pending at the suit of the County Council (par. 4). "Such works" were more fully described in par. 1 of the proclamation as "works for the supply of electricity and the supply and installing of electrical fittings and appliances". (at p117)

2. With these provisions in mind it is, I think, possible to state briefly the contentions which the appellant has raised. First of all it is said that the effect of sub-s. (3A), following upon the proclamation of 21st November 1958, was to divest from the respondent its rights to all outstanding claims for electricity charges, including the subject matter of this action, and to vest these rights in the Prospect County Council. But, it is said, there is no power in the Supreme Court to allow an amendment which would have the effect of substituting the Prospect County Council as the plaintiff in the action in place of the present respondent. Finally, it was contended that, although it would be permissible and proper to allow such an amendment if par. 4 of the proclamation of 9th December 1959 applied to actions in relation to claims of the character of that asserted in the action, upon its true construction that paragraph did not comprehend this action. The basis of this contention was the presence in the paragraph of the qualifying expression "in relation to such works". In the result it was claimed that since the plaintiff had lost its right in the subject matter of the action by virtue of sub-s. (3A) and the County Council was not entitled, either pursuant to an amendment or otherwise, to pursue the action, it should be perpetually stayed. As already appears Walsh J. refused the application for a stay and held that the action had become one pending at the suit of the County Council. Likewise, upon appeal to the Full Court, the application for a stay was refused and the appeal was dismissed. But the Full Court directed that the order which had been made in the first instance should be varied "by striking out paragraph 2". We have not before us the order made by the learned judge of first instance, but at the conclusion of his reasons he formulated his "decisions and orders" in a series of numbered paragraphs. By the first paragraph he refused the application for a perpetual stay and in the second paragraph he purported to hold that the action had become an application pending at the suit of the Prospect County Council. This paragraph, however, was not in form or substance an order; it was a statement of the view which his Honour had formed and which, by itself, was fatal to the appellant's application. That being so the effect of the Full Court's order was to confirm the original order in so far as it was the subject of an appeal and, thereupon, to indicate dissent from the conclusion of Walsh J. as expressed in the paragraph referred to. In fact, a majority of the Full Court concluded that paragraphs 3 and 4 of the proclamation of 9th December 1959 had an operation limited to such an extent that they did not pass to the County Council the subject matter of the action. Accordingly they were of the opinion that the Penrith Council's right, as asserted in the action, remained unaffected. Macfarlan J., however, endorsed the view which Walsh J. had taken. (at p118)

3. It is now conceded, and I think rightly conceded, that the application for a perpetual stay was misconceived. The substance of the matter relied upon by the appellant might, no doubt, have been raised by an appropriate plea to the further maintenance of the action by the Penrith Council but it has not been the practice to stay proceedings merely upon the ground that the defendant has a good defence (cf. Smith v. Curtis (1833) 2 Dowl 223 and Sherwood v. Benson [1812] EngR 493; (1812) 4 Taunt 631 (128 ER 478) ). Further the application was especially inappropriate in the present action for it raised, in the absence of the County Council, the question whether, in the language of par. 4 of the proclamation of 9th December 1959, the action was then pending at the suit of that Council or at the suit of the Penrith Council. This means, of course, that the appeal must be dismissed. But we are asked to go further and, again in the absence of the County Council, determine the extent to which that Council acquired rights pursuant to pars. 3 and 4 of the proclamation and as a corollary, the extent to which it assumed the obligations of the Penrith Council under the later paragraphs of that proclamation. (at p118)

4. Since the matter has been fully argued and the facts are not in dispute I am prepared, though not without some reluctance, to deal with the matter as if the relevant questions of law had been stated for the opinion of the Court before trial. Accordingly, I proceed to consider whether the Penrith Council has, since the commencement of the action, lost its interest in the debt sued for by reason of the operation, either, of (1) sub-s. (3A) of s. 564 of the Local Government Act or (2) the provisions of pars. 3 and 4 of the proclamation of 9th December 1959. (at p118)

5. In so far as the appellant's argument relates solely to the provisions of the proclamation it is faced with a dilemma for if, as was contended, the effect of the expression in pars. 3 and 4 - "in relation to such works" - is to exclude from the operation of those paragraphs charges for electricity supplied and actions to recover such charges then it is beyond question that the action may be continued at the suit of the Penrith Council. On the other hand, if the contrary view be taken, then the action, in the language of par. 4, is pending at the suit of the County Council. And the appellant concedes that in that event the proceedings may be amended and the action continued by that Council without affording to the appellant any of the benefits which might accrue to it if it were necessary at this late hour for the County Council to commence a fresh action. It will be seen therefore that the appellant's argument concerning the effect of sub-s. (3A) of s. 564 is fundamental. (at p119)

6. Consideration of the terms of sub-s. (3A) makes it quite clear that its provisions were not intended to effect a transfer of either rights or liabilities to a county council in the specified circumstances. In terms, the sub-section deals with "functions, powers and duties". These are constitutional attributes and the sub-section has nothing whatever to say with respect to rights of property or contractual rights or obligations. This is sufficient to dispose of the initial step in the appellant's argument but, additionally, some attention may be given to the curious form of the sub-section. Its terms constitute a departure from the so-called "delegation" (as to which see s. 560) by proclamation of the powers of a municipality or shire to a county council pursuant to the general provisions of s. 564; in terms, sub-s. (3A) purports to extend the County Council's existing powers, whatever they may be, over the additional area which, in effect, it has acquired. This, of course, is no more or less than the result which would have been achieved if the County Council had succeeded to the relevant "functions, powers and duties" of the municipal council or councils affected by the alteration of the County Council's boundaries. But the point I wish to make is that there was not, by virtue of sub-s. (3A), any transfer of functions, powers and duties from the Penrith Council to the County Council and, therefore, upon no view could it be taken to effect a transfer of rights or obligations from the former to the latter. The final provision of the sub-section that "such functions, powers and duties shall . . . be deemed to have been delegated to the county council in respect of the area or part added to the county district" carries the matter no further. That provision merely constitutes a device to render applicable later machinery provisions of Pt XXIX. (at p119)

7. Accordingly, the whole question falls to be decided according to the manner in which the expression in the proclamation- "in relation to such works" -should be understood. The appellant's argument, in effect, was that the various paragraphs in which the expression was used were restricted in their operation to matters connected with "the works", that is to say with the buildings and plant, if any, and other items of a fixed capital nature formerly used in the Penrith Council's electricity undertaking. This restricted meaning was to be given whether the "matter" was all real and personal property and all right and interest therein and all management and control of any land or thing which immediately before the material date was vested in or belonged to the said council (par. 2), all rates, moneys, liquidated and unliquidated claims which immediately before the material date were payable to or recoverable by the said council (par. 3), all suits, actions and proceedings, pending immediately before the material date at the suit of the said council (par. 4), all contracts, agreements and undertakings entered into with . . . the said council (par. 5), all debts due and moneys payable by the said council . . . and all claims liquidated or unliquidated recoverable against the said council (par. 8), or every person who immediately before the material date was a servant of the said council and who was wholly or principally employed on or in connexion with any such works (par. 15). It is clear that either upon the view contended for by the appellant or upon the contrary view some existing rights and some existing liabilities passed to the County Council by virtue of the proclamation. It is equally obvious that it was necessary that some restrictive words should be introduced into the various paragraphs of the proclamation for quite clearly, it was not intended, and it was not the object of the proclamation, to transfer to the County Council the whole of the rights and liabilities of the Penrith Council. Nor were all of the contracts made with the Penrith Council to be deemed to be contracts or agreements entered into with the County Council. Nor were all of the Penrith Council's servants to be transferred to the service of the County Council. At the most the County Council was to be the successor of the Penrith Council only in relation to matters connected with the supply of electricity in the additional area which, in effect, the former acquired from the latter. And it is, perhaps, not out of place to observe that the general tenor of the proclamation rather suggests that it was the intention that the County Council, in effect, as the successor of the Penrith Council in the relevant portion of the additional area, should take over the latter's electricity undertaking as a going concern. In these circumstances the expression "in relation to the said works" appears as one designed to distinguish between, on the one hand, matters associated with the electricity undertaking and, on the other, matters not so associated rather than as one designed to discriminate between debts and liabilities, contracts, servants and so on, all admittedly associated entirely with the electricity undertaking, but not all payable or recoverable or entered into or employed solely in relation to or in connexion with "the works" in the sense which the appellant seeks to place upon that expression. (at p121)

8. The critical expression, it should be observed, is not the copyright of the author of the proclamation: it is used time and time again in s. 564B of the Act and it is used there in precisely the same context as that in which it is to be found in the proclamation in question here. No doubt it was this section, speaking as it does of the effect of a proclamation made under s. 564 of the Act, which determined the form of the proclamation with which we are concerned. I do not repeat the many provisions of the former section but I refer especially to pars. (a), (b), (c), (d), (g) and (m) of sub-s. (1). "Such works" in these paragraphs mean "any works" as that expression is used in the opening words of s. 564B - "Where by a proclamation under section five hundred and sixty-four of this Act the powers and duties in relation to any works . . . which are vested in a council of an area wholly or partly included in a county district . . . are delegated to the council of such county district . . ". It is, I think, of importance to notice that the section speaks of delegation by a proclamation under s. 564 of a municipal council's powers and duties in relation to any works. But s. 564 does not, in terms, purport to authorize the delegation of powers and duties in relation to works. The delegation under sub-s. (2), which may be either particular or general, is of some power or duty which by law the requesting councils or any of them may exercise or perform. In describing any such general power or duty it is sufficient to quote the part or section number of the statute prescribing the power or duty. Under sub-s. (2A), where a county district is constituted for the purpose of the supply of water, gas or electricity in bulk only, the councils of the municipalities and shires concerned in the district may request the Governor to delegate to the County Council the power to exercise or perform so much of any power or duty which by law those councils or any one of them may exercise or perform as relates to the supply of water, gas or electricity in bulk only. Pursuant to sub-s. (3), notwithstanding the absence of any request from a constituent council, the Governor may by proclamation delegate to the County Council the power to exercise or perform for the benefit of the county district, any power or duty which by law those councils or any one of them may exercise or perform in relation to the establishment acquisition and conduct of a trading undertaking for the supply of gas and the supply and installing of fittings and appliances. Where any such proclamation has been made the County Council is to have full power to exercise the powers so delegated. Returning then to s. 564B it will be seen that this section characterizes proclamations suchas those authorized by s. 564 as proclamations by which powers and duties in relation to any works which are vested in the council of an area wholly or partly included in a county district are delegated to the council of such county district. Obviously in this setting it would be quite inappropriate togive to the italicized expression the restricted meaning for which the appellant contends. The various sub-sections of s. 564 to which I have referred, envisage the delegation of powers to conduct undertakings and proclamations made for the purpose of "delegating" such powers are characterized by s. 564B as the delegation of powers and duties in relation to works. That being so the compendious expression, "in relation to any works" must be given a more liberal meaning than the appellant's argument ascribes to it and for my part I find no difficulty in treating it in this context as synonymous with "undertaking". If this be so there can be no doubt that the same expression, as used in a great many of the ensuing paragraphs, must be taken to have been used in the same sense and, further, that it was in that sense that it was used in the proclamation of 9th December 1959. (at p122)

9. I should add that if, as I think was the case, it was intended the Prospect Council should take over the undertaking as a going concern it would be difficult to understand why some and not all of the existing debts and liabilities were to be taken over by the Prospect Council. Nor can I imagine that it was intended that it should be necessary - as it would be if the appellant's argument were successful - for the County Council to make fresh contracts with all persons desiring supplies of electricity in the additional area taken over by it. (at p122)

10. For these reasons the appeal should be dismissed subject to the order of the Full Court being varied by deleting all reference to "paragraph 2" of the order of Walsh J. (at p122)

WINDEYER J. The complicated facts out of which this appeal arises are set out in other judgments. I need not repeat them. In the events which have happened certain actions pending at the suit of the Penrith Municipal Council have by force of law been converted into actions pending at the suit of the Prospect County Council. Is this such an action? That seemed to be the whole question. And the answer to it depends upon whether the proceedings can be said to be "in relation to the works", that is the electricity works formerly carried on by the Penrith Council. As I see the matter, the action is one in relation to those works. I think that that expression covers all actions arising in any way out of the carrying on of works for the reticulation and supply of electricity. I agree in substance with what Taylor J. has said on this aspect. Whether the action instituted to recover the alleged debt should, as a matter of procedure, be carried on henceforth by and in the name of the Penrith Council or by and in the name of the Prospect County Council does not seem to be a matter of vital importance to the appellant, the defendant in the action. Either it owes, in whole or in part, the money claimed or it does not. It is not suggested that it is troubled about who its creditor is because it wants to pay. It disputes the debt and what it mistakenly thought might happen is that some part of the alleged debt would be statute barred if the name of the plaintiff to the action had to be changed. It was this that led it so eagerly to contend that it should now face a new adversary. But it could fare no better, for there would be no need for a new action. It is the existing action that has now been made an action pending at the suit of the Prospect County Council. To give effect to the statute which produces this result I think that the name of the plaintiff should now be altered by an amendment of the proceedings in the action in the Supreme Court. I should add that I do not accept the appellant's contention that, apart from the proclamation, s. 564(3A) of the Act effected a transfer of a debt. The transfer or "delegation" of functions, powers and duties does not operate as an assignment of debts accrued. (at p123)

2. I would dismiss the appeal. (at p123)

OWEN J. On 28th March 1958 the plaintiff, the respondent to this appeal, to which I shall refer as the Penrith Council, issued a writ against the defendant appellant claiming 11,860 pounds 6s.0d. for electricity supplied to the defendant between March 1952 and January 1957 during which time the plaintiff was carrying on an electricity undertaking. The questions which we are asked to decide are whether, in the light of the matters presently to be stated, the plaintiff is entitled to continue this action and, if it is not so entitled, whether another body, the Council of the Prospect County District (hereinafter referred to as the Prospect Council) is entitled to be substituted for the plaintiff and to continue the action. (at p123)

2. The Prospect Council was constituted by a proclamation published in the Government Gazette of 12th October 1956 pursuant to the provisions of s. 561 of the Local Government Act (N.S.W.). The proclamation described the area of the County District, which did not then include the Municipality of Penrith, and by par. (a) "delegated" to the Prospect Council: "the power to exercise or perform for the benefit of the County District . . . . (a) All the powers or duties under section 382 of the Local Government Act relating to the construction, extension, protection, maintenance, control and management of works for the supply of electricity, and all the powers or duties under sections 416 to 419, both inclusive, of the Local Government Act relating to the supply of electricity, and the supply and installing of electrical fittings and appliances (including the power to purchase, generate, manufacture or obtain electricity or electrical fittings and appliances for sale or hire);" "Delegation" is defined by s. 560 to mean "delegation of powers from a group of Councils of areas to a County Council . . ." It will be noticed that the powers or duties delegated by the proclamation included those relating to the construction etc. of "works for the supply of electricity" as well as those under ss. 416 to 419 of the Act relating to "the supply of electricity" and electrical fittings. The first of these groups of powers or duties may be committed to the care and management of a municipal council under Pt XIV of the Act which is headed "Water, Sewerage, Drainage or Electricity Works" and, in that Part, the word "works" appears to refer to buildings and plant and other structures used for the purpose (so far as electricity is concerned) of generating and distributing electricity. The same meaning seems to be given to the word "works" where it appears in Pt XXXIX of the Act (Compare, for example, ss. 564B (1), 564D (1) and 564E with s. 564 (2A)). The powers or duties with which ss. 416 to 419 deal relate (so far as electricity is concerned) to the "supply of electricity and the supply and installing of electrical fittings and appliances". In other words a distinction is made in the Act and in the proclamation between the duties or powers of a council relating to "works for the supply of electricity" and duties or powers relating to "the supply of electricity" and this is of importance in determining the questions arising in the appeal. (at p124)

3. These delegations to which I have referred were made under s. 564 by which the councils of the municipalities and shires concerned in a County District may request the Governor to delegate to the County Council of that District any power or duty which those councils or shires may exercise or perform and the County Council may undertake any function thus delegated to it. (at p124)

4. By s. 564B (1) it is provided that where by a proclamation under s. 564 "the powers and duties in relation to any works" which are vested in the council of an area wholly or partly included in a County District or the control or management of which are vested in such council are delegated to the council of the County District, certain provisions are to have effect. Amongst those provisions is one lettered 'b' which provides that: "All rates, moneys, liquidated and unliquidated claims which immediately before the date of the delegation are payable to or recoverable by the constituent Council in relation to such works shall be rates, moneys, liquidated or unliquidated claims payable to or recoverable by the County Council." Paragraph (c) of these provisions is in these terms: "All suits, actions and proceedings pending immediately before the date of the delegation at the suit of the constituent Council in relation to any matter or claim in relation to such works shall respectively be suits, actions and proceedings pending at the suit of the County Council." It will be noticed that whereas s. 564 speaks of the delegation by municipal or shire councils of any powers or duties which they may exercise or perform, s. 564B refers only to the delegation of powers or duties "in relation to any works" vested in the council of a constituent area. Here again a distinction is drawn between powers or duties relating to "works" and other powers or duties. (at p125)

5. To continue with the history of the case, a further proclamation issued on 21st November 1958 which, by par. (1), extended the boundaries of the County District so as to include the Municipality of Penrith and, by par. (4), purported to enable the Prospect Council to exercise or enforce, on its own behalf, any right or power formerly exercised by the Penrith Council "in relation to works for the supply of electricity and the supply and installing of electrical fittings and appliances". This proclamation was considered by Myers J. in Penrith Municipal Council v. Prospect County Council (1959) 5 LGRA 205 . His Honour held that par. (1) of the proclamation which extended the boundaries of the County District to cover the Municipality of Penrith was validly made but that par. (4) was invalid because the power to effect such a delegation of the rights and powers therein stated could be exercised only upon the request of the Penrith Council and no such request had been made. (at p125)

6. The next step was that in November 1959, following upon this decision, the Local Government Act was amended by adding to s. 564 a new sub-s. (3A). This provided that where the boundaries of a County District are extended, the council of the County District shall have and may exercise in respect of the County District as so altered all the functions, powers and duties which it had and was entitled to exercise in respect of the County District immediately before the alteration. It provided further that those functions, powers and duties should, as on and from the date specified in the proclamation altering the County District boundaries, be deemed to have been delegated to the County Council in respect of the added area. The amending Act also added a new section, s. 564BA. Sub-section (1) of that section provides that where a proclamation has been made altering the boundaries of a County District, the Governor may, by the same or any subsequent proclamation, provide for all matters necessary for, consequential upon or incidental to the alteration, and provide for any matter or thing which he may deem necessary or expedient in the circumstances. Without limiting the generality of this provision, sub-s. (2) of the new s. 564BA goes on to specify a number of powers, including powers to provide for the transfer of assets, rights and liabilities and suits, actions and proceedings pending immediately before the alteration at the suit of any of the councils of the areas affected by the alteration. Section 8 (2)(a) and (b) of the same amending Act validated all past alterations of County District areas and all matters done in connexion with or consequential upon or incidental to such alterations; and by s. 8 (2)(b)(ii) any proclamation made or purporting to have been made in connexion with or consequential upon or incidental to any such alteration was declared to be as valid and effectual as it would have been had the new s. 564BA been in force at the time when such proclamation was made. From this validating provision, however, par. (4) of the proclamation of 21st November, 1958, this being one of the paragraphs held by Myers J. to have been invalid, was expressly excluded (s. 8(2) (b)(iii)). Section 8 (2)(c) authorized the making of a proclamation under the new s. 564BA to have effect as and from the date stated in it in relation to the alteration of the boundaries of the Prospect County District made by the proclamation of 21st November, 1958, notwithstanding that such alterations were made before the amending Act. It provided further that, on and from the date when such proclamation took effect, the new s. 564 (3A) should have effect as if the alterations of the boundaries of the County District had taken place on that date. Following the coming into force of the amending Act, a proclamation was published on 18th December 1959. It recited the proclamation of 12th October 1956 and, by par. (1), ordered that on and from 1st January 1960 the Prospect Council should be substituted for the Penrith and other named municipal councils (including the Liverpool Municipal Council) so as to enable the Prospect Council to exercise or enforce, on its own behalf, any right or power formerly exercised by the councils "in relation to works for the supply of electricity and the supply and installing of electrical fittings and appliances". There followed a number of consequential provisions, one of which (par. 3) provided that: "All rates, moneys, liquidated and unliquidated claims which immediately before the 1st January, 1960 were payable to or recoverable by any of the said Councils in relation to such works should be payable to or recoverable by the County Council." Another such provision (par. 4) was as follows: "All suits, actions and proceedings pending immediately before the material date at the suit of any of the said Councils in relation to any matter or claim in relation to such works should be suits, actions and proceedings pending at the suit of the County Council." (at p127)

7. In Liverpool Municipal Council v. Prospect County Council (1960) 5 LGRA 214 Else-Mitchell J. had to consider the effect of this proclamation in relation to the area of the Liverpool Municipal Council. For reasons which need not be set out here, his Honour held that par. (1) was invalid but that the other parts of the proclamation were valid. His Honour held further that even if par. (1) had been valid, it would have done no more than was effected by what he called the "self-executing provisions" of s. 8(2)(c) of the amending Act once the proclamation of 18th December, 1959 (which was valid in part) had issued. "The consequence is", said his Honour, "that a valid proclamation having been made under s. 8(2)(c) the provisions of s. 564(3A) apply as from 1st January 1960 to authorize the Prospect County Council to exercise in the area of the Liverpool Municipal Council the powers set out in the 1956 proclamation constituting the Prospect County District" (1960) 5 LGRA, at p 221 . With this I agree. The result of all this seems to be that as from 1st January 1960 the Prospect Council became entitled to exercise in the County District which was enlarged to include the Penrith Council area all the powers or duties conferred upon it by the 1956 proclamation in relation to the County District before its enlargement and such additional powers or duties as were conferred upon it as a result of the proclamation of 18th December 1959 made under the amending Act. As and from 1st January 1960, therefore, the Prospect Council became entitled to exercise or perform in the Penrith area (a) the powers or duties which were formerly exercised or performed by the Penrith Council relating to the "construction, extension, protection, maintenance, control and management of works for the supply of electricity", these being matters with which both the 1956 and the 1959 proclamations dealt; and (b) all the powers or duties under ss. 416 to 419 "relating to the supply of electricity", which were delegated under the 1956 proclamation and which later came to apply to the Penrith area. The consequential provisions in the proclamation of 18th December 1959 which made moneys recoverable by the Penrith Council immediately before 1st January 1960 recoverable by the Prospect Council and made proceedings pending at the suit of the Penrith Council immediately before that date proceedings pending at the suit of the Prospect Council were, however, limited in their effect to moneys recoverable and proceedings pending "in relation to such works". And, by reference back to the invalid par. (1) of the proclamation, "such works" are "works for the supply of electricity". (at p128)

8. The distinction which is drawn both in the Act itself and in the proclamations between powers or duties "in relation to works" and powers or duties relating to "the supply of electricity" seems to me to make it impossible to read the words "such works" in these consequential provisions as including the "supply" of electricity. (at p128)

9. I am of opinion, therefore, that the Penrith Council is entitled to continue, in its own right, the present action. The moneys sought to be recovered were not payable to the Penrith Council in relation to "works for the supply of electricity" and par. (3) of the 1959 proclamation did not therefore operate to transfer from the Penrith Council to the Prospect Council the right to recover the moneys. The proceedings pending at the suit of the Penrith Council were not proceedings "in relation to any matter or claim in relation to such works" and were therefore not affected by par. (4) of the proclamation. I should add that I agree with Brereton J. who expressed the view in his judgment in the Full Court that the result is not an extraordinary one. The Penrith Council is seeking to recover payment for electricity supplied by it to a consumer. I think it would be surprising if, having expended money in providing that supply, the Penrith Council's right to recover whatever became due to it from that consumer for that supply were divested from it and vested in the Prospect Council. The appeal should be dismissed with costs. (at p128)

ORDER

Order of the Supreme Court varied by deleting so much thereof as purports to direct that paragraph 2 of the order of Walsh J. be struck out. Otherwise appeal dismissed with costs.