[Matthew Saunders]

Hi everyone,

I have always been under the assumption that the proportion of properties on a minimum rate needs to be below 50% due to the Sutton v Blue Mountains case and I have always kept ours below this level, but I know that there are councils that have the number of properties on a minimum that are well above the 50% mark.

I was reading IPART’s application form for increases to minimum rates today and they say that:

The Act was amended following Sutton to undo the effect of the case by setting a dollar
value limit (this system remains today) and by making it clear that a minimum amount
or a rate is not invalid because of:
• the size of the minimum amount; or
• the fact that many or all ratepayers are levied at the minimum amount.

Does anyone have any idea what wording was changed in the Act after the Sutton decision?

Any information would be greatly appreciated.

Kind regards,

Matthew.

[Andrew Butcher]

Hi Matt
I agree with you and suspect the principle from the Sutton case, being minimums are the exception and not the rule (otherwise they are a charge) would still fly, but it would take an L&E court challenge for that to be re-determined.
There were changes made in the 1993 Act that affect the way minimums are described, the old Act was more aligned to an ad-valorem ‘rate’ payable by all landowners proportionate to the value of their land, i.e. emphasis was specifically placed on the ad-valorem component. This was identified in the Sutton case and consequently the government has changed the way minimums are now defined.
I hope this is helpful and personally I would avoid levying a minimum that produces income above 50% of rates within a category or subcategory based on principle.
However the OLG is correct and Section 548 does not strictly prevent a council from charging a minimum to more than 50% of ratepayers.

Regards,
Andrew

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