By WENDY BACON
Inner West Council is seeking advice from the NSW government on how a suspension of pay penalty for its Mayor Darcy Byrne will work in practice.
On August 3rd, the NSW Civil and Administrative Tribunal (NCAT) convicted Byrne of four counts of misconduct and two further partial breaches of the NSW Local Government code of conduct. As a penalty NCAT suspended Byrne’s right to be paid any fee or other remuneration for his duties for three months.
Byrne had failed to declare a non-pecuniary conflict-of-interest at Council meetings. This occurred after he instructed his lawyers to send what is known as a legal ‘notice of concerns’ letters to Greens Councillor Colin Hesse and Independent Councillor Pauline Lockie warning them that unless they withdrew and apologised for comments he considered defamatory, he would sue them. On the same day, he used his public position on Council to move a motion calling on the Councillors to withdraw comments that were potentially defamatory and brought the Council into disrepute. Having placed Lockie and Hesse into a position where they had to withdraw from the meeting because they had a potential interest in the outcome, he failed to declare his own interest. In other words, he used his own public office to bring pressure to bear to resolve a private legal dispute.
A ‘notice of concerns’ letter conveys a warning that defamation proceedings will begin unless demands for a remedy are met. It can be the first step in defamation proceedings but is also a tool used by politicians, developers and others to shut down public criticism.
NCAT Principal member Linda Pearson found Byrne’s code of conduct breaches were serious ones and that any “reasonable person” would have realised there was a conflict of interest. She found that a suspension of pay was appropriate rather than more lenient options of ‘counselling’ or ‘reprimand’ or a more serious one of ‘suspension from office”. She found that Byrne’s experience as a Councillor and then Mayor meant that he had “an important role of leadership and responsibility towards other councillors and members of the community” which meant that his misconduct justified “a greater degree of censure”.
In submissions to the Tribunal, Byrne accepted that he made a “bad error” but that he had learned from his experience and apologised. Pearson relied on character references including one from City of Sydney Labor Councillor Linda Scott that Byrne was a “dedicated and passionate advocate for his community” and that his actions were “out of character” and he felt “remorse”.
The Council is yet to make a public announcement about the pay suspension and its implications. However, Councillor Lockie posted a news report about the judgement on her Facebook page and wrote, “As the target of Clr Byrne’s actions, I welcome yesterday’s judgement …. this dates back to comments made by other people on a Facebook post I’d written that was critical of Labor-Liberal support for the Victoria Road Precinct development, which was approved against staff advice. I’ve said before that I think it’s important for independent Councillors to speak out about these issues when they arise. While it’s certainly intimidating to be targeted due to this, I’ll continue to do so.” (For more on the Victoria Road development, see below.)
Councillor Hesse told the Independent, “For me the whole thing had been very stressful, and I’m sure Clr Lockie feels pretty similar.” He said that one of his concerns was that the process “took far too long …. While the staff of the Office of Local Government did a very good job, the obvious lack of resources to carry out the investigation and prosecution of abuses of power is clearly insufficient.”
Before the findings against him, on different occasions Byrne variously maintained that the Office of Local Government investigation was part of a conspiracy to stop him campaigning against NSW government rorts, or that if he had committed breaches they were ‘minor process issues’.
Some of Byrne’s supporters continue to promote the view that the affair is trivial. Asked what he thought about that, Hesse said,“To me it felt like being bullied, and I hope that’s not something Labor supporters or members would support in any situation. Byrne’s actions, as demonstrated by the NCAT decision, were entirely premeditated, and clearly broke the rules.”
Underlying these events are issues of public accountability and the conduct of Councillors and use of their power. They also reflect long standing community tensions about the relationship between local Labor politicians and Labor identities who become lobbyists and consultants, including for property developers.
A reading of the penalty judgement reveals fresh insights into Byrne’s explanation for his errors. I will return to these.
What happens to the Mayoral allowance?
The Inner West Council Mayoral allowance is $90,000, compared to ordinary councillors who get $31,000 a year. Part of the Mayor allowance goes to the Deputy Mayor who is currently Councillor Victor Macri. This means that Byrne will forgo quarter of his annual income or approximately $20,000 which is a substantial penalty.
Inner West Independent asked the Inner West Council (IWC) manager Peter Gainsford last week whether the amount of the penalty will be retained by the Council or returned to the government. We also asked whether the allowance could be paid to a different Councillor if Byrne were to stand aside. This option would mean that the community would still have a Mayor who was being compensated while Byrne would continue as a Councillor. A spokesperson replied, “Council is seeking confirmation around the implementation of the NCAT decision from the NSW Government.”
Under Section 440M of the NSW Local Government Act, the OLG could bill the Council for the cost of its investigation into Byrne’s conduct but there is no public indication yet that it intends to pursue this course.
Politicians at all levels of government are required to lodge a ‘disclosure of interest’ notice. This accountability measure provides transparency for financial interests. Councillors disclose their financial interests once a year. In order to understand whether Byrne has other sources of income, Inner West Independent looked up his ‘disclosure of interests’ on the Council website. Some Councillors update their form during the year, but Byrne appears not to. His latest disclosure lists income as an ‘electoral officer’. We knew that Byrne worked for Labor leader and local Federal MP Anthony Albanese but understood that the arrangement had terminated. So we sought confirmation from the Mayor’s media officer Bill Hawker but got no response. So we contacted Albanese’s media team who confirmed that Byrne left his office in 2019.
Byrne’s disclosures are now a year old, so an update is imminent. Assuming his Mayoralty allowance is now his only income, Byrne’s penalty is quite severe. He would also have incurred significant legal fees. He was represented by the Labor aligned firm Turner Freeman so there may have been a discount.
Developer links with Labor figures
The Victoria Road Precinct stretches over several blocks of Marrickville; most of it is owned by the Danias family who are timber merchants and property agents. For nearly a decade, Danias Holdings have been planning major high rise residential and commercial developments, including what they call a Creative Hub. In 2014, Danias hired well known local Labor figure Sean Macken to assist with their development. Macken had stood for Labor preselection twice, ran Labor electoral and preselection campaigns and had been a Labor staffer and a Councillor on South Sydney Council. In 2015, David Tierney’s consultancy firm TITFA joined the Danias team. Tierney has been a significant player in NSW Labor politics with a career as a senior Labor staffer and corporate manager in Multiplex developments. Shortly before working for Danias, he was a senior staffer in the Office of the then Labor Opposition leader Luke Foley.
The development faced significant community opposition but also had supporters for its promised Creative Hub. Macken was quoted as saying that the Hub would be the “largest concentration of creative space anywhere in the Southern Hemisphere” including 700 jobs for artists. Eventually a rezoning from industrial to partly residential was imposed by the NSW government but the Inner West Council still had a role to play in approvals.
In 2018, Macken accused the Council of using ‘red tape’ to delay the development. Unless it moved ahead, he predicted the Creative Hub would be at risk. Byrne was quoted in the same Inner West Courier article as urging expedition of the Danias proposal.
At a meeting on August 28th 2018, staff recommended that Council postpone the approval of a Victoria Rd Development Control Plan (DCP) while more work was done on developer contributions. Their ballpark calculation of these was that they could cost up to $50 million, an estimate which turned out to be too high.
Despite the staff recommendation, Byrne and then Deputy Mayor Julie Passas moved that the DCP be accepted. The motion narrowly passed with Labor and Liberal Councillors all voting in favour of it.
After the meeting, Lockie posted on her Facebook page: “I’m appalled that other Councillors ignored strong legal and planning advice from our own staff in favour of developers – and that the Mayor was the one pushing this. So much for ‘Save Marrickville’”. If you think that this is robust political commentary that is nevertheless not defamatory, you are right.
The next day, Byrne put out a media release welcoming the development. He posted this on Lockie’s discussion thread. Hesse added a comment, “Here’s a promotion from the developers”. If you think Hesse was just drawing attention to the alignment between the developers and Labor, which is within the bounds of acceptable political communication, you are also right.
However a community member later posted a comment that could be regarded as defamatory. Lockie did not delete this unwittingly leaving herself liable for publishing another person’s comment.
Defamation warnings arrive – six months after publication
It’s important to understand that nothing happened for six months. Jump forward to March 28th, 2019. The Victoria Street development was again on the agenda that evening. Late that afternoon Lockie and Hesse were emailed the warning letters. Staff recommended DCP approval this time but Byrne and Passas tagged an extra clause onto the main motion calling on Councillors to apologise for potentially defamatory comments. The vote was postponed until early April.
With a potential costly defamation threat hanging over them, Lockie and Hesse were forced to declare an interest and withdraw from voting on the motion calling on them to apologise. This meant it would inevitably pass. In his Tribunal evidence, Byrne said that he genuinely didn’t understand that the defence of his personal reputation was not a Council matter. Independent Councillor John Stamolis, Greens Councillors Rochelle Porteous and Tom Kiat, who is a lawyer, all spelled out at the meeting why they considered Byrne’s actions inappropriate. Nevertheless Byrne went ahead and the motion passed with Labor and Liberal support. Byrne acknowledged that he had struggled to understand how non-pecuniary interests work. He realises now that his conduct was ‘unethical’ and he should have withdrawn himself.
Where is the media coverage?
So why did Byrne take this action? He told the Tribunal that in the lead up to the meeting, “There had been a significant amount of media coverage and consequent Facebook commentary in relation to the posts” which led him to be concerned that they would be repeated. Inner West Independent did a database search for media reports but could find no such commentary. His evidence was that he was “concerned with putting a stop to what he saw as destructive behaviour immediately”. But if this was the case, why didn’t Byrne request that the comments be removed and an apology be offered at the time they occurred?
Hesse neither withdrew nor apologised for his comment. Lockie apologised not for her own comments but for ones posted by others. As soon as she did this, Byrne posted humiliating and mocking comments about Lockie on his own Facebook page. This led to further internal code of conduct findings against him, which were also considered during the penalty hearing. Having left his Facebook post there for many months, Byrne finally removed it and told the Tribunal that he was sorry for the stress he had caused both Hesse and Lockie.
Byrne’s conspiracy allegations misfire
Byrne’s first public response to news that he was being taken to the Tribunal by the OLG was to go on the attack. When he appeared before the Parliamentary Inquiry into the rorts involved in the NSW government’s Stronger Community Fund, Byrne seized media attention by accusing the OLG of targeting him because he was campaigning against the rorts that deprived councils of grants. The Committee decided not to investigate his allegations. The OLG provided correspondence that showed Byrne was aware that they were investigating him well before his campaign against the Stronger Communities Fund. But by then, Byrne had even paid for a Facebook ad to promote a report of his allegations on his own Mayoral page. He continued to allege the allegations against him were ‘trumped up’ until February this year. He told the Tribunal he now understands that he was wrong.
Byrne told the Tribunal he repeatedly requested more regulatory training
But in acknowledging his weakness, Byrne also blamed others. He told the Tribunal that “he has repeatedly requested training in Councillors’ legal and regulatory obligations from multiple managers”. Assuming this is true, were these requests in writing or if they were verbal are they recorded in filenotes? To ignore requests that indicate a Mayor does not understand regulatory and legal obligations is a serious matter. This raises further doubts about the conduct of the Inner West Council. What other issues did Byrne feel uncertain about that led him to request training? What steps did he himself take to sort out his uncertainties?
There is a Mayoral election in September. If Byrne was to step aside, the community could have a new paid Mayor for three months. There is no indication yet that Byrne intends to take this course or that the Labor team is reconsidering their support for him.
Meanwhile, the first block of the Marrickville Victoria Road Precinct, including several creative organisations, was demolished this month to make way for high rise residential blocks. An office has been selling “Wicks Place’ off the plan for months.The Creative Hub, which Danias had promised would take precedence, is still on hold. So far more creative jobs have been lost than gained.
