In Peregrine Mineral Sands Pty Ltd v Wentworth Shire Council  NSWCA 429 the council entered into an agreement with the agent of developers of a sand mine that provided the developers would pay to council:
Clause 3.1(a) stated: ‘Land rates of $100,000 per annum commencing 1 January 2006 and adjusted annually in accordance with the Local Government Act.’
Section 494(1) of the Local Government Act 1993 provides that councils are required to levy make and levy an ordinary rate for each year on all rateable land in its area. Section 534 outlines that each rate is to be made for a specified year.
It was held by McColl JA that in order to satisfy the mandatory requirements of its rate making functions, the council must exercise it annually. While councils have broad powers to enter into contracts, this power does not extend to the point that it fetters mandatory requirements imposed by the Act. A council is not able to enter into long-term agreements about rates liabilities because it contravenes its mandatory duties under the Local Government Act 1993.
To read the full judgment regarding the environmental incident addressed in Peregrine click on the following link –http://www.caselaw.nsw.gov.au/decision/54a63ffe3004de94513dc9ff (link is external)
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