A & S City Classic Pty Limited v North Sydney Council

Land and Environment Court (NSW)|2006-06-21|Before: Mr P

Background. 1 This appeal was lodged against council's refusal of a development application for the use of premises at 407 Pacific Highway, Crows Nest, as a brothel. For the appeal, the following issues were identified: + appropriateness of the location, considering its relationship and proximity to other sensitive land uses, + amenity impacts on the neighbourhood, concerning overlooking, noise and light spill, + car parking.

2 The parties agreed to Mr P. Grech being the Court appointed expert for planning and he presented a detailed assessment report, which is Exhibit 5. The site. 3 The subject property is located at 407 Pacific Highway, Crows Nest and it is described as Lot 10 in DP 29672. It has an area of 333 sq m, which is located between two street frontages, i.e. 7.4m frontage to the Pacific Highway and 13.5m frontage to Alexander St.

5 The basement carpark is accessed by roller door in Alexander Street and provides site parking for 4 vehicles. There is a right-of-way adjoining the site to the north, alongside which is an "Ultra tune" mechanic workshop at No 8.

6 The site is located within the Crows Nest Commercial area. On the opposite side of Alexander Street there is a mix of shops and offices. No 11 Alexander Street is a chinese restaurant and on the southeast corner of the Alexander/Falcon Street intersection is another restaurant.

7 North Sydney Girls High School is located adjacent to the Pacific Highway to the south east of the subject site and is approximately 200 metres walking distance from the entrance to the proposed brothel. The proposal. 8 This proposal involves the change of use of the first floor level of the building from commercial use to a brothel. Access to the brothel is proposed via an existing door entry fronting Alexander Street. The existing door access from the first floor to Pacific Highway is proposed as an emergency fire escape only and is not intended for regular patron or staff use.

9 Consent is sought for new internal building works to accommodate the proposed use, including reception and 2 waiting rooms, 6 client service rooms, staff facilities, bathroom facilities and cleaning facilities. A garbage storage area and 2 parking spaces located within the existing basement are proposed to serve the proposed use.

10 Signage for the proposed brothel is limited to an illuminated street number (200mm high) above the new entry doorway. The proposed hours of operation are: + Sunday to Thursday - 10 a.m. to 12 a.m. + Friday and Saturday - 10 a.m. to 1 a.m.

11 The applicant has provided a Plan of Management (POM) for the operation of the premises, to ensure the safety of workers and establish operational procedures in accordance with Workcover and NSW Health Guidelines for brothel premises. Planning controls 12 North Sydney Local Environmental Plan 2001 (NSLEP). Under this NSLEP the site is in the "Mixed Use" zone and the proposed use as "Restricted Premises" is permissible with consent.

" Restrictive premises "; is defined in Schedule 2 of NSLEP 2001 to mean " premises used for the purpose of a massage parlour, a brothel, adult sexual services or the like" (each of which terms is not separately defined) and is permissible with consent. 13 The objectives for this mixed use zone are to: ( a) encourage a diverse range of living, employment, recreational and social opportunities, which do not adversely affect the amenity of the residential areas, and (b) create interesting and vibrant neighbourhood centres with safe, high quality urban environments with residential amenity, and (c) maintain existing commercial space and allow for residential development in mixed use buildings width non-residential uses at lower levels and residential above, and … North Sydney Development Control Plan 2002 (DCP).

14 This DCP contains a profile of the North Sydney area and identifies objectives and controls for all development within the council area, in order to achieve the desired character, urban design and community outcomes.

15 The "mixed use" areas provide for a variety of residential and commercial floor space. The functions of this zone include: + various grades and sizes of commercial floorspace to accommodate a mix of small and large businesses, services, high-tech industries, retail and recreation, + the dwelling mix achieves an on-site dwelling density contributing to energy-efficient design and residential amenity… + uses and activities are mixed to meet the needs of residents, workforce and visitors…

16 These functions are appropriately related to environmental criteria, quality built form, quality urban environment, efficient use resources and public domain considerations.

17 Section 17 deals with Restricted Premises, which are identified as those used for the purpose of a massage parlour, brothel, adult sexual services and the like. The planning controls are applied to ensure that restricted premises operate in appropriate locations and do not impact on the amenity or well-being of the community. It refers to The Disorderly Houses Amendment Act 1995.

18 Restricted premises are only permissible (with Council consent) in the Mixed Use and Commercial Zones under the LEP and prohibited in all other zones. The desired outcome is that:

Restricted premises are designed, located and operated in a manner, which avoids adverse impacts on the amenity of the surrounding area, and protects workers and customers of restricted premises.

19 During the passage of this development application, section 17.1-Urban Environment, was amended, to include the following provisions which deal with the clustering of restricted premises:

Location and internal planning a. No adverse effects on the surrounding area due to scale, operating hours, traffic generation, lighting, noise and the number of employees and clients. i. Consider effects of operation of the restricted premises on the neighbourhood ii. Locate restricted premises outside a radius of 100 metres from and out of sight of a place of worship, hospital, school or the other place frequented by children for recreational, cultural or other similar activities, or community facilities iii. Locate restricted premises outside a radius of 500 (lineal) metres from any existing restricted premises iv. Locate restricted premises above the ground floor level or street level of the building, away from shop fronts, arcades or thoroughfares generally used by the public and locations of high pedestrian access v. Provide access to restricted premises directly from roads or car parking areas, so that access is not obtained through public portions of buildings vi. Locate restricted premises away from apartment and multiunit dwellings vii. Provide internal reception/waiting areas to prevent clients from loitering outside restricted premises. Avoid designs and locations that might encourage people to wait outside premises. The evidence. 20 In addition to the Court appointed experts assessment, a further planning assessment was allowed from Mr S. Czeref, on behalf of the council to deal with the developing character of the immediate locality, relative to cl 17 of the DCP. A number of residents expressed their objections to the proposal on-site and these have been considered in conjunction with the written objections contained in councils' bundle of documents.

21 Mr Grech acknowledged the amendments to section 17 of the DCP as having the following effects: + to include "adult bookshops" within the ambit of "restricted premises" and consequently be controlled by the provisions of Section 17, + to specify that brothels should not be located within 100 metres (to be measured radially) to various sensitive uses (as referred to in subclause ii). + that brothels should not be located within 500 metres (to be measured radially) from another "restricted premises".

22 Consequently, he assessed the relationship to the respective sensitive land uses including other restricted premises. Insofar as he concluded that the site of the proposed brothel would be unlikely to create undue adverse impact on these sensitive uses, nevertheless he identified the following premises, which require specific consideration under provisions of section 17: + A 'brothel' known as "ESP" located at No. 7-7A Falcon Street, which is 27 metres measured radially and excluding the rear access handle of the property (less than 90 metres walking distance of the site); and + An adult bookshop located at 91A Willoughby Road, 439 metres measured radially from the site.

23 His ultimate conclusion on the suitability of the subject site for the proposed brothel, depends on the status of ESP. If this ESP operation is considered as a massage therapy studio as originally approved, then he considers the proposal merits conditional consent because it is not classified as restrictive premises. But if ESP operates as a brothel, the proposal then does not comply with the separation requirements and he is unable to support it.

24 At this point, I note that after his assessment of the proposal, Mr Czeref concluded that: The purpose of clause 17.1 (a) (iii) of the DCP (as amended) is to avoid the clustering of restricted premises in any given locality. Therefore, given that there is already an approved restricted premises in the immediate locality (ESP), to allow another one in the same locality, less than 100 metres apart, would be inconsistent with the desired and evolving future character of the locality. I consider that the provision of more than one restricted premises in the Mixed Use Zone that is closer than 100 metres apart poses both likely future adverse consequences for the achievement of residential amenity potential and would serve as a disincentive for future mixed use development involving residential development in the immediate neighbourhood. The proposal should be refused consent.

25 This conclusion is consistent with the objections from a considerable number of people that the site is unsuitable for a brothel and that the development should be refused. However Mr Grech has independently addressed the matters raised by the objectors. Other objections were lodged on moral grounds but I have confined my assessment to the planning merits of the case.

26 Accordingly from Mr Grech's evidence, the threshold issue concerns the status of the operations of ESP, because it is located within the 100m separation distance and other "anti-clustering" controls stated in the DCP. Notwithstanding this, these controls are not development standards and therefore some discretion can be exercised, depending on the merits of the particular case. In this regard, no details were presented to the Court, outlining the basis for these numeric controls. Presumably some discretion could be exercised if some form of barriers exist (e.g. intervening highways or railway line), which reduce direct amenity impacts.

27 Mr Grech says that from his investigations, if ESP is operating as a brothel, which it appears to be doing by reference to its website, then it is doing so without development consent. It was granted deferred development consent (No 1588/97) on 24/8/98 for the change of use of the property to a "massage therapy studio". From the evidence presented to the Court, it appears that some discussions between the parties were undertaken regarding the kind of services to be provided, prior to council granting the ESP consent. This consequently resulted in the imposition of the following condition 2: The premises shall only be used as a massage parlour. Use of the premises as a brothel or for adult sexual services would need to be the subject of a further development application.

28 From this, Mr Grech, makes the following comments: + the approval was granted under North Sydney LEP 1989, which differs from the current applicable LEP and DCP, + the application was for a "change of use to massage centre and associated fit out" and the development plan describes the proposal as "ESP Relaxation Centre ", + the report to council describes the proposed activities as involving "a full body massage, which may be involve removal of clothing" and was uncertain as to whether sexual services were provided. It was nonetheless concluded that the use fell either within the definition of a "brothel" or" adult services", both been permissible in the zone, + the aforementioned condition 2 was imposed, + on the basis that a "massage parlour" is classified as a brothel, then this condition 2 is contradictory, + the consented to use could fall within the definition of "restricted premises " as identified by LEP 2001 and DCP 2002, because it technically permits a " massage, parlour" being a term included in the definitions.

29 Accordingly, Mr Grech's interpretation is that the ESP consent allows the operation as a facility, which provides for remedial massage services (definable under the current LEP as commercial premises), and not one which provides adult services or a brothel, defined as restricted premises. This interpretation confirms his support for this development proposal.

30 With regard to the other issues, Mr Grech assessed the potential impacts of the proposal relative to the other sensitive land uses. This is on the basis that LEP 2001 contains 7 residential zones, 1 commercial zone, 1 waterfront zone, 1 special use zone and separate road, public open space, bushland, public recreation, private recreation and a Luna Park zone.

31 Restricted premises are specifically defined by the LEP and are permitted only within the 1 mixed-use zone and 1 commercial zone. The locality, including residential premises opposite the Pacific Highway and Alexander Street, are all located within the Mixed Use zone. The Mixed Use zone also permits various forms of residential development, including apartment buildings, attached dwellings and dwelling houses. Consequently, Mr Grech says that it is a reasonable assumption that these various forms of residential accommodation are planned to co-exist in reasonable proximity to restricted premises, considering both are specifically permitted uses within the same zone. 32 Notwithstanding this, Mr Grech has undertaken a detailed survey and assessment of the nearby residential properties and other sensitive land uses, to conclude that the proposal will result in acceptable amenity impacts.From my observations on the view, including the locations of 9 Alexander Street, 12 Hayberry Street, and 250 Pacific Highway, I am persuaded to accept Mr Grechs assumptions and following conclusions that the separation distances to residential properties in this mixed use zone are reasonable because: + the subject premises are not located within a building jointly occupied or likely to be occupied by residential premises, + the subject building is not adjoining residential premises or is in such proximity to residential premises that would prevent any person accessing surrounding residential apartments without the option of walking directly in front of the entrance of the proposed brothel, + the presentation of the subject premises towards the Pacific Highway, would comprise only upper floor windows, which would be appropriately screened in accordance with a Condition of Consent and a ground floor access, which would be available for emergency purposes only. It would not be possible to view into the premises from residences on the opposite side of the Pacific Highway, nor would there be any other form of recognition of the operation of brothel, such as the movement of patrons in and out on the premises from nearby unit along the Pacific Highway, + the Alexander Street presentation of the subject premises would involve a bank of windows in the first floor level, which are similarly to be screened in accordance with the Conditions of Consent, of any possible view from residents opposite directly into the premises. Similarly, the doorway into the premises is within a slightly recessed alcove providing access to a staircase only. It would not be possible to view directly into the first floor premises subject to some minor modification as discussed later, + provided the existing car parking in the basement level is not available for client use, then there would not be activity associated with the movement of client vehicles into and out of the premises, which would likely be more frequent in comparison to staff usage.

33 Another issue raised by council and a number of the objectors concerned that potential exposure of the brothel to schoolchildren. This particularly relates to North Sydney Girls High School, which is located approximately 200m to the south of the site. In addition to this, other sensitive sites include the Baptist Church and a number of bus stops potentially used by schoolchildren were identified. But Mr Grech has located these uses on his Illustration 8, which shows that there are no (sensitive) uses within the 100m radius. Insofar as, schoolchildren may choose to walk past the proposed brothel, Mr Grech undertook a number of observations and found that: + the bus stop located on the Pacific Highway, approximately 20 metres to the north of the site was heavily utilised by schoolchildren, including children waiting to catch buses and schoolchildren alighting from buses during the morning period, up to about 9 a.m. At any one time there could be up to 10 to 15 schoolchildren congregated at this bus stop, + in the afternoon, between approximately 2:30 p.m. to 3:45 p.m., there were no schoolchildren congregated in the bus stop, but the occasional schoolchild alighted a bus. When alighting from a bus, schoolchildren immediately dispersed. (The number of adults at the bus stop between the same periods varied from nil to 3), + both the Pacific Highway/Willoughby Road, and Pacific Highway/Alexander Street form relatively distinct pedestrian routes. However, the Pacific Highway/Willoughby Road, route is more heavily utilized. In regard to schoolchildren pedestrian traffic, the Pacific Highway/Willoughby Road route was in constant and relatively heavy use by schoolchildren in the afternoon period. While the Pacific Highway/Alexander Street was used relatively infrequently.

34 These observations by Mr Grech seem to be reliable, to show that the proposed location of the brothel, with its only entry from Alexander Street, is not on a major childrens pedestrian route, which would warrant its refusal. I also note the evidence that the bus stops in the Pacific Highway are proposed to be relocated away from school and closer to the brothel, but this still provides significant separation distance with any possible viewing being at a distinctly oblique angle. Accordingly, I do not consider this possible, relocated bus stop would warrant refusal of the proposal.

35 The next issue concerns possible impacts on the developing character of the locality. In this regard, Mr Grech acknowledges that the subject neighbourhood in Alexander Street, is relatively less active than Crows Nest commercial centre, where there are a number of restaurants and other commercial premises. Notwithstanding this, he says it is a reasonable expectation that a restricted premises could operate on the subject site, in accordance with the LEP 2001 provisions, particularly taking into account the very limited areas where brothels are permitted. CONCLUSIONS 36 Having carefully considered the evidence, the submissions and undertaken a view, I am satisfied this proposal has merit. Even though a considerable number of objections were lodged, nevertheless the proposal is located within the mixed use zone where a suitable brothel is permitted, in reasonable proximity to other uses, including residential units. A number of the objectors subsequently acknowledged that a suitably conditioned brothel could operate with minimal amenity impacts, from these premises.

37 In summary then, I am satisfied to rely on the Court appointed experts conclusion that this application for a brothel merits conditional consent, subject to the status of the ESP development being confirmed. If ESP is a lawful restricted premises, then I would also accept Mr Grech's conclusion that this subject brothel application should be refused because the two developments would be too close to each other.

38 Insofar as the status of the ESP consent was discussed during the hearing and various submissions were made by the respective parties regarding the legal status of the consent, Ms Irish submitted the following possible questions of law. 39 Assuming the following agreed facts:

a. that the "deferred development consent", date of determination: 25 May 1998, which was granted subject to conditions, to Development Application No 1588/97 and relates to land described as 7-7A Falcon Street, Crows Nest (" the ESP consent ") is existing (i.e. has not lapsed); and b. that the proposed development the subject of these proceedings is "restricted premises" as defined in NSLEP 2001 and North Sydney DCP 2002 (as amended on 4 May 2006) to which the control in Section 17.1.a.iii of the North Sydney applies; and c. that the proposed development the subject of this proceeding, is located within a radius of 500 metres from 7-7A Falcon Street, Crows Nest (" the ESP premises ").

Q1. On its proper construction, taking into account Condition 2 of the ESP consent, is the ESP consent for "a massage parlour": (a) included in the definition of "adult services" in cl5 (1) of NSLEP 1989; (b) now included in the definition of "restricted premises" in Schedule 2 to NSLEP 2001? Q2. Is the ESP premises an existing restricted premises within the meaning of "any existing restricted premises" in Section 17.1.a.iii of North Sydney DCP 2002 (as amended on 4 May 2006)? 40 In the ultimate, I am satisfied that the status of the ESP operation is critical to the outcome of the subject development application, when the anti-clustering provisions of cl. 17 of the DCP are taken into account. In making this assessment however, I accept that the separation distances are contained within the DCP, so that some discretion may be exercised in applying the nominated separation distances, depending on the circumstances of the case. Unfortunately no supporting details for the basis of these controls were presented to the Court.

41 From my assessment, the uncertainty with the ESP consent arises because: + The development consent of 24/8/98 was granted; pursuant to Section 91AA for the proposed change of use to a massage therapy studio, + Condition 2 seems to change this description as follows; "The premises shall only be used as a massage parlour . Use of the premises as a brothel or for adult sexual services would need to be the subject of a further development application." 42 According to Mr Baird's submissions:

Council, however, approved the application subject to the condition that it was specifically not as a brothel or adult sexual services. There are no specific conditions restricting entry to the premises to people over 18 years of age or dealing with health standards per the draft DCP. It is submitted that the consent as granted cannot fall within the definition of "restricted premises" under the 2002 LEP. The North Sydney LEP 1989 at clause 5 defines "adult services" to mean "the use of premises for the purpose of a massage parlour, adult sexual services or the like, but not for the purpose of a home occupation." A brothel was defined to mean "premises habitually used for the purpose of prostitution, but not for the purpose of a home occupation." Prostitution nor "massage therapy centre" are defined in the LEP 1989. In the Draft DCP "brothel", "Adult services" and "Home occupation" were referred to. "Adult services" includes the use of premises for the purpose of a massage parlour, the sale of adult sexual services, adult sexual services or the like, but not for the purpose of a home occupation. It is clear that the reference to "massage parlour" here is in the context of the offering of sexual gratification. Not to a massage therapy studio. "Commercial premises" means a building or place use as an office or for other business or commercial purposes, but does not include a building or place used for a purpose elsewhere specifically defined in this clause. Even if the consent is valid it is properly characterised as "commercial premises" as the consent specifically prohibits both "adult sexual services" and use as a "brothel". 43 In summary, Mr Bairds ultimate submission is that the existing operation of ESP is unlawful and should not be a reason for the refusal of a legitimate development application.

44 On the basis of the limited evidence before the Court, it then seems to me that there is a prima facle case that ESP was approved as a massage therapy studio, which is not a restricted premises and therefore the subject proposal could be granted consent, on the 1 year trial period basis supported by the Court appointed expert Mr Grech. Otherwise some clarification of the classification of therapeutic massage studios is required, to enable determination of their suitability within the context of the cl 17 anti-clustering controls.

45 For the reasons then, it is intended to make the following orders, subject to the matter being adjourned for a period of 3 weeks for the parties to make any further submissions relative to the status of the ESP consent, or to initiate any action for the formulation and resolution of any appropriate questions of law, so that final orders can be made.

46 The draft orders are: 1. The appeal is upheld. 2. Development consent is granted to DA No. D358/05 for the operation of a brothel at 407 Pacific Highway, Crows Nest, subject to the conditions in Annexure 'A'. 3. The exhibits may be returned except for Exhibits 4, 5, 7, 14, C and D.

      R Hussey
      Commissioner of the Court
      ljr

11/10/2006 - The street address has been further amended - Paragraph(s) Paragraph Nos. 1 and 46

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.

CITATION : A & S City Classic Pty Limited v North Sydney Council [2006] NSWLEC 346 This decision has been amended. Please see the end of the judgment for a list of the amendments.

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