A lawyer representing former Wodonga Council staff, including one whose complaint sparked an Ombudsman investigation, has described the organisation’s culture “as nothing less than toxic” and called for the chief executive’s resignation.
Wangaratta lawyer John Suta, and a senior solicitor at Shine Lawyers confirmed Wodonga Council has opened itself up to a possible class action by ratepayers, after the Ombudsman revealed an $18 million overcharge over a decade.
Shine Lawyer’s senior solicitor Tristan Gaven said he was interested in holding a town hall meeting to inform residents about their rights.
“We believe there may be a basis for a class action based on a claim for restitution by the ratepayers,” Mr Gaven said.
Ratepayers were overcharged thus bringing financial loss and damage on ratepayers - it's ratepayers money not councils.Wangaratta lawyer John Suta on a potential class action against Wodonga Council
“While there may be issues in relation to limitation periods for amounts paid more than six years ago, in the event that an action was successful, ratepayers would be entitled to recover all charges that were held to be invalid by the court plus interest.”
Mr Suta told The Border Mail one of his clients, who worked as a strategic asset manager from January 2007, complained about the actions of senior staff to the Ombudsman.
“My client made a complaint to the Ombudsman under an alias, as at the time they were still employed by council,” Mr Suta said.
“The complaint was basically that (they were) overcharging for waste services above the cost of the services, subjecting the community to excess charges and inflicting a financial cost on ratepayers.”
Mr Suta said ratepayers, as a whole, were overcharged by $3.37 million in 2015-16 alone and $3.033 million in 2016-17 at an individual cost of $90.90 to each ratepayer in 2016 and $74.99 in 2017, Mr Suta said.
“What council did was they undertook a course of action where there was significant financial cross-subsidisation from waste to other departments, which obviously was not the real cost to service,” he said.
Mr Suta said despite what council have claimed since the Ombudsman’s report was published on Tuesday, his understanding is that their actions were not done in “good faith”.
“Council have ducked, weaved and hidden under every rock in response to this and said they did it in good faith, my instructions do not reflect that,” he said.
“Council was overcharging waste services above the cost of service, which was illegal and contrary to law.”
Mr Suta said ratepayers have a clear case for a class action against council “on the basis of council’s actions”.
He said the cost of remuneration if a class action was successful would affect council’s budget.
There may be a basis for a class action based on a claim for restitution by the ratepayers.Shine Lawyers
But, he said, it was up to the public to decide if they wanted to take action on principle.
“Ratepayers were overcharged thus bringing financial loss and damage on ratepayers, it's ratepayers money not council’s,” he said.
“It could place a principle financial burden on council, but transparency should override the financial burden on council, never mind the fact of public trust.”
Mr Suta said former employees at council say the culture is “toxic”, and said resigning was “absolutely the right thing” for Wodonga chief executive Patience Harrington to do.
Ms Harrington joined council in 2003 and was appointed chief executive in April 2012.
She refused to answer questions about council’s “toxic culture” or whether council had been subjected to any bullying complaints or legal action.
Instead, Ms Harrington said Wodonga Council received the highest customer satisfaction of any Victorian regional city in 2017.
“This is driven by a staff culture that is measured by an internal survey which indicates that staff are highly engaged and know what they are here to do in working for our community,” she said.
Ms Harrington refused to say whether she or any other senior staff would be resigning.
“The council is hearing the community concerns and we are already working with the Essential Services Commission about how we represent the revenue and expenditure differently,” she said.
“The council has received no complaints against officers on this issue.”
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When asked about a possible class action, Ms Harrington said council was always aware of the “legal risks and opportunities” associated with their decisions and worked to mitigate them.
Meanwhile, Indigo Shire mayor Jenny O’Connor has backed its new chief executive officer, who was formerly employed at Wodonga council.
Trevor Ierino announced in December last year he was leaving his role as Director of Business Service with Wodonga Council after 10 years.
Mr Ierino started as chief executive at Indigo Shire in February.
The announcement of his departure occurred about nine months after Wodonga mayor Anna Speedie, Ms Harrington and the Minister for Local Government were formally notified about the Ombudsman investigation on March 24 last year.
“There are no issues for us, Trevor’s role was completely within the appropriate level of what council staff would do,” she said.
“In terms of Trevor as a CEO he is doing an outstanding job, the community is very happy with his engagement and willingness to address issues they have and staff tell me they have great confidence in him as their new manager. From a council point of view, without exception, we are very happy with him in the role.”
Mr Ierino declined to answer questions about the waste levy charge or how and when the overcharging began.
“I am no longer an employee of Wodonga Council and it would be inappropriate for me to make any comments in relation to Wodonga Council matters,” he said in a statement.
Cr O’Connor defended the actions and transparency of Wodonga Council and Cr Speedie.
“Wodonga Council acted within the Local Government Act which needs to be further clarified around the definition of waste management,” she said.
“Obviously some see it as picking up waste and getting rid or it but from a council point of view other things are involved.
“It’s a lot more than just a truck picking up rubbish and then dropping it at a landfill site.”