ALCOA AUSTRALIA ROLLED PRODUCTS PTY LTD v WESTON ALUMINIUM PTY LTD

CATCHWORDS: ENVIRONMENTAL LAW - Building and town planning - scope of development consent - construction by reference to existing activities - incorporation by reference of material extrinsic - when reference to extrinsic material permissible. - ENVIRONMENTAL LAW - Noxious and offensive trades and premises - licensing under environmental protection legislation - aluminium processing plant - licence permitting reprocessing of by-product conditional upon development consent - variation of licence - whether power to vary subject to s 50(2) - Protection of the Environment Operations Act 1997 (NSW), ss 50(2), 58, Environmental Planning and Assessment Act 1979 (NSW), s 91

Environmental Planning and Assessment Act 1979 (NSW), ss 91, 91A, 93 LEGISLATION CITED: Land and Environment Court Act 1979 (NSW), s58 Protection of the Environment Operations Act 1997 (NSW), ss 48, 50, 51, 55, 58

Auburn Municipal Council v Szabo (1971) 67 LGRA 427 Halglide Pty Ltd v PT Ltd (1990) 71 LGRA 215 CASES CITED: House of Peace Pty Ltd v Bankstown City Council (2000) 48 NSWLR 498 Ryde Municipal Council v The Royal Ryde Homes (1970) 19 LGRA 321 Wollongong City Council v Australian Iron and Steel Pty Ltd (1988) 67 LGRA 51

Matter No. 40293/06: Alcoa Australia Rolled Products Pty Ltd - Appellant Weston Aluminium Pty Ltd - Respondent PARTIES: Matter No. 41009/05: Weston Aluminium Pty Ltd - Appellant Environment Protection Authority - First Respondent Alcoa Australia Rolled Products Pty Ltd - Second Respondent

Mr R. Ellicott QC/Ms S. Duggan - Aloca Australia Rolled Products COUNSEL: Mr P. Tomasetti/Mr J. Johnson - Weston Aluminium N/A - Environment Protection Authority

Holding Redlich - Alcoa Australia Rolled Products SOLICITORS: Kanjian & Company - Weston Aluminium Environment Protection Authority, Legal Services Branch

LOWER COURT JURISDICTION: Land & Environment Court

LOWER COURT FILE NUMBER(S): LEC 41622/03 LEC 40149/05

LOWER COURT JUDICIAL OFFICER: Lloyd J - CA 40293/06, Pain J - CA 41009/05,

LOWER COURT DATE OF DECISION: 20 August 2004 (CA 40293/06), 9 December 2005 (CA 41009/05)

LOWER COURT MEDIUM NEUTRAL CITATION: Weston Aluminium Pty Limited v Alcoa Australia Rolled Products Pty Limited [2004] NSWLEC 551; Weston Aluminium Pty Limited v Environment Protection Authority & Anor [No. 2] [2005] NSWLEC 698

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40293/06 LEC 40149/06 CA 41009/05 LEC 41622/04

SPIGELMAN CJ McCOLL JA BASTEN JA

4 October 2006 ALCOA AUSTRALIA ROLLED PRODUCTS PTY LIMITED v WESTON ALUMINIUM PTY LIMITED WESTON ALUMINIUM PTY LIMITED v ENVIRONMENT PROTECTION AUTHORITY & ANOR

Alcoa Australia Rolled Products Pty Ltd ("Alcoa") operates an aluminium processing plant pursuant to a series of development consents. Under these consents and pursuant to a licence under the Protection of the Environment Operations Act 1997 (NSW) ("the POE Act"), it also reprocessed aluminium dross into aluminium. It sought variation of the licence allowing it to accept and treat dross imported from its interstate operation. The grant of a licence under s 50(2) of the POE Act required development consent to the activity to be permitted by the licence. The Environmental Protection Authority granted the variation under s 58 of the POE Act despite the absence of an independent development consent to the modified activity. Weston Aluminium Pty Ltd, a former recipient of the imported dross, challenged, in two separate proceedings in the Land and Environment Court, (i) the scope of the original consents relied on by Alcoa to allow treatment of dross generated off-site; and (ii) the grant of a variation of the licence without an appropriate development consent approving the licensed activity.

At first instance in relation to (i), Lloyd J held the scope of the original consents did not extend to reprocessing dross brought in from other sources because, having regard to previous practice at the time of the original application, Alcoa's operations did not involve processing dross from other sources. Lloyd J also based his conclusion on the absence from the development application of any reference to the importation of dross from the interstate source.

In subsequent proceedings in relation to (ii), Pain J dismissed the challenge to the variation of the licence under the POE Act, holding that the s 50(2) condition applied only to the grant, and not to variation, of a licence.

HELD with respect to (i): (Basten JA, Spigelman CJ and McColl JA agreeing):

(1) A consent operates in rem and is not personal to the applicant but enures for the benefit of subsequent owners and occupiers. It must speak according to its written terms, construed in context but having regard to its enuring function. The terms of another document may be incorporated in a development approval either expressly or by necessary implication: at [35]-[36]. Unless so incorporated, they will not condition the consent: at [39]. Ryde Municipal Council v The Royal Ryde Homes (1970) 19 LGRA 321 applied; Wollongong City Council v Australian Iron and Steel Pty Ltd (1988) 67 LGRA 51 at 57 doubted.

House of Peace Pty Ltd v Bankstown City Council (2000) 48 NSWLR 498 at 504 [23] and 507 [37]; Auburn Municipal Council v Szabo (1971) 67 LGRA 427at 433-434, followed.

(2) The consents did not limit the activity on the site by reference to some aspect of previous practice. Accordingly, no assistance is to be found in existing practices as to the feedstock used on site prior to the original consent being given: at [37].

(3) Construed by reference to their terms, the consents did not limit the feedstock for the rotary furnace so as to exclude dross produced elsewhere: at [46].

HELD with respect to (ii): (Basten JA, Spigelman CJ agreeing)

(4) A licence being required under the POE Act in respect of a scheduled activity, an existing licence cannot be varied under s58 of the POE Act, to permit a new scheduled activity: at [75], [81]. This conclusion follows from the scheme for "integrated development" under ss 91 and 91A of the Environmental Planning and Assessment Act 1979 (NSW). The existence of the prohibition in s 50(2) on the grant of a licence unless and until a relevant consent has been granted also indicates an implied limitation on the scope of a variation: at [82].

(5) The primary judge (Pain J) was correct to dismiss the proceedings below, but not because s 50(2) of the POE Act did not apply to a variation sought under s 58.

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40293/06 LEC 40149/06 CA 41009/05 LEC 41622/04

SPIGELMAN CJ McCOLL JA BASTEN JA

4 October 2006 ALCOA AUSTRALIA ROLLED PRODUCTS PTY LIMITED v WESTON ALUMINIUM PTY LIMITED WESTON ALUMINIUM PTY LIMITED v ENVIRONMENT PROTECTION AUTHORITY & ANOR Judgment 1 SPIGELMAN CJ: I agree with Basten JA. 2 McCOLL JA: I have had the benefit of reading Basten JA's judgment in draft. I am grateful to his Honour for his comprehensive analysis of the facts and elucidation of the issues. 3 I agree, for the reasons his Honour has given, that Lloyd J erred in concluding that the development consent under which Alcoa operated at Yennora did not permit it to accept and process dross from Point Henry. 4 That is sufficient to dispose of Alcoa's appeal. It also removes the premise on which Weston's challenge to the licence variation was based. 5 I agree with the orders Basten JA proposes. 6 BASTEN JA: Alcoa Australia Rolled Products Pty Ltd ("Alcoa") operates an aluminium processing plant on land at Yennora in the west of Sydney. For many years it has processed scrap aluminium and recycled aluminium cans. One of the by-products of aluminium processing is a form of aluminium oxide known as "dross", which can itself be reprocessed to produce aluminium. Alcoa has also processed, in its plant at Yennora, dross produced in its melting furnaces. 7 Aluminium scrap can be fed directly into the melting furnaces; recycled cans, which contain paint and a lacquer coating, must first go through a cleaning process in a rotary furnace. Dross is also processed first through the rotary furnace. 8 For some decades, there have been environmental protection laws in New South Wales which have prohibited the carrying out of environmentally harmful activities, without a licence. Relevant provisions for present purposes are now found in the Protection of the Environment Operations Act 1997 (NSW) ("the PEO Act"). Prior to September 2000, Alcoa, then operating in a joint venture with Kobe Steel Ltd, through a company known as Kaal Australia Pty Ltd, held a licence (no. 642) under the PEO Act. On 21 September 2000, the company sought a variation of that licence to permit it to accept and treat dross from its Point Henry smelters in Victoria. The variation was granted by the Environment Protection Authority (NSW) on 29 November 2001. 9 One of the recipients of dross from the Point Henry facility, at September 2000, was Weston Aluminium Pty Ltd ("Weston Aluminium"), which operates a processing facility at Cessnock. From about 2002, after the grant of the licence variation, dross from Point Henry was processed at the Yennora site, now operated by Alcoa. Weston Aluminium sought to challenge the legal authority of Alcoa to process Point Henry dross at the Yennora site. 10 The challenge by Weston gave rise to two questions:

(1) Did the development consents under which Alcoa operated at Yennora permit the processing of aluminium dross brought from Point Henry?

(2) If not, was the licence variation granted under the PEO Act invalid because Alcoa did not, at the time of its grant, have development consent for the relevant activity?

Procedural history 11 While the parties to the proceedings in this Court are united in their wish for the Court to provide definitive answers to these questions, it is necessary to note the procedural history by which the matters come before the Court. Two sets of proceedings were commenced in the Land and Environment Court by Weston Aluminium. The first, by way of a class 4 application filed on 23 December 2003, sought a declaration that the processing at Yennora of aluminium dross, other than aluminium dross formed as a result of Alcoa's operations at Yennora, was in breach of the Environmental Planning and Assessment Act 1979 (NSW) ("the EPA Act"). It also sought an order restraining Alcoa from processing such dross at Yennora. 12 That application was heard in August 2004, judgment being delivered by Lloyd J on 20 August 2004. His Honour concluded that the development consents under which Alcoa operated at Yennora did not permit it to accept and process dross from Point Henry. However, his Honour did not make final orders, or indeed any orders, other than to direct the parties to bring in short minutes of order to give effect to the judgment: Weston Aluminium Pty Ltd v Alcoa Australia Rolled Products Pty Ltd [2004] NSWLEC 551 at [43]. No orders have yet been made and hence Alcoa had no right of appeal: Land and Environment Court Act, 1979 (NSW), s 58(1) and (3). 13 Not only were no orders made in those proceedings, but Alcoa did not, at that stage, seek leave to appeal against the findings made by Lloyd J. Rather, on 4 March 2005, it lodged a further development application with the relevant consent authority under the EPA Act, the Council of the City of Holroyd. The fate of that application is still undetermined. The Council not having determined it within the time provided by the EPA Act, it was deemed to have been refused and proceedings have been commenced in the Land and Environment Court challenging the deemed refusal. If Alcoa succeeds in this Court in its challenge to the judgment of Lloyd J, the further proceedings in the Land and Environment Court may be otiose, although that is not entirely clear. On the other hand, if the fresh development application were granted, the issues raised in this Court, would remain alive, but of limited significance. Nevertheless, both parties sought to resolve their dispute in relation to the existing development consents, and accordingly the matters should be dealt with on that basis. 14 On 25 February 2005 Weston Aluminium commenced a second set of proceedings in the Land and Environment Court, challenging the validity of the variation of the licence granted under the PEO Act in November 2001. The basis of the challenge was an alleged contravention of the requirement of s 50(2) of the PEO Act, as in force at the relevant time, which required that a licence not be granted where the activity the subject of the licence required development consent and that consent had not been granted. On 15 December 2005 Pain J dismissed the application, on the basis that the requirement of development consent applied only to the grant of a licence and not to a variation. Weston Aluminium has appealed against her Honour's decision as of right, by notice of appeal dated 30 December 2005. 15 As part of its defensive position in relation to that appeal, Alcoa contended that, even if her Honour were wrong, and a development consent was required for a valid licence variation, nevertheless the consents under which Alcoa operated satisfied that condition. In support of that contention, they filed an application, well out of time, for leave to appeal against the findings of Lloyd J to the contrary. Weston Aluminium does not oppose the extension of time, nor the application for leave to appeal from the judgment of Lloyd J. In the circumstances, it is appropriate that Alcoa be granted the necessary extension of time and be granted leave to appeal from the earlier judgment. 16 Because the only basis upon which the licence variation was challenged was the absence of an appropriate development consent for the activity purportedly permitted, it is convenient to deal first with the challenge to the decision of Lloyd J. If his Honour's findings are upheld, it will be necessary to consider the matter determined by Pain J; if, on the other hand, the development consents in existence in November 2001 permitted the activity proposed to be undertaken by Alcoa, then the premise underlying the challenge to the validity of the licence variation may fall away. although Iit remains necessary to consider the judgment of Pain J in order to deal with the costs incurred in those proceedings.

History of development consents 17 The significant history of the development consents applicable to Alcoa's plant and activities at Yennora dates from 1980. Alcoa (and its predecessors in title) owned an area of land bounded on the north and south by Loftus and Nelson Roads respectively, and on the east and west by Norrie Street and Pine Road respectively. The land has not always been owned by Alcoa, but as the benefit of each consent runs with the land, nothing turns on the changes in ownership prior to 2000. 18 The original plant was on land south of Nelson Road. The development of the area north of Nelson Road, commencing in 1980, involved an expansion and modernisation of a facility originally commissioned in the 1960s. The existence of a rotary furnace and melting furnaces and associated works, with appropriate development consents, forms part of the context for the later redevelopment, but with one minor exception it is not necessary to consider the pre-1980 history. In 1980 a new can reclamation plant and rotary furnace were approved for erection to the north of Nelson Road: this will be addressed in due course. At the heart of the argument, however, was the significance of a staged development involving the melting furnaces, commencing in 1981. 19 On 26 June 1981, an application was made for development consent to construct a new "remelt facility" on the land north of Nelson Road. Accompanying that application was an environmental impact statement, and other documentation. Whilst Alcoa resisted reliance by the Court on these materials for the purposes of construing the relevant development consents (an issue of peripheral relevance which will be addressed below) senior counsel for Alcoa took the Court to relevant parts of the documentation as a convenient source of background information. The following history is derived from the 1981 environmental impact statement. (Weston Aluminium contended that the material was relevant to the construction argument, and hence did not object to reliance upon it for any purpose by Alcoa.) 20 Referring to the then owner of the site, the EIS stated (p 3): "Comalco Products, a Division of Comalco Aluminium Ltd, operates a large aluminium semi-fabricating plant at Yennora, Sydney, NSW directly employing approximately 1100 persons. The plant receives primary aluminium from Bell Bay smelter, Tasmania, and scrap aluminium from regional and internal sources. These materials are converted into sheet, plate and extruded sections and sold for the manufacture of aluminium cans, roofing, wall cladding and the fabrication of architectural building products. Within the Yennora plant the company operates an aluminium remelt facility. This plant converts scrap aluminium into a form for further processing by melting the metal and casting it into blocks for rolling and billets for extrusion. Due to increasing scrap generation, including aluminium can reclamation, it is forecast that the present remelt facility will be insufficient to cope with the scrap input by 1982."

The EIS then stated (p 4) that the proposed remelt facility would work "in conjunction with the adjacent can reclamation and rotary furnace complex". The capacity of the plant was to be increased from 66,000 tonnes per annum to 90,000 tonnes per annum. 21 Apart from noting the capacity of the proposed remelt facility, no figures were provided for the proportion of its feedstock derived from different sources. For example, no figures were provided as to what percentage of the feedstock came from the rotary furnaces, by way of reprocessed cans and dross, what proportion was scrap aluminium fed directly to the melting furnaces and what proportion was aluminium ingots prepared at Bell Bay, Tasmania. It appears that the makeup of the feedstock was largely irrelevant to the environmental impact of the melting furnaces. The application did not involve any change to the operation of the rotary furnaces, with the consequence that there was no discussion of them, except as the recipients of dross produced by the melting furnaces. In that respect the EIS predicted that despite the increased capacity, "the total volume of dross produced will remain at current levels": p 40. The statement continued: "It is therefore anticipated that the volume of slag and bag house dust generated from dross treatment in the adjacent rotary furnace complex will remain at current levels." 22 As will be seen below, a significant issue before Lloyd J was the effect and significance of development consent no. 81/254, which resulted from consideration by the Council of this application and environmental impact statement. The significance of the consent was said to derive from condition 19 which sought to impose a requirement with respect to "disposal of liquid effluents and solid wastes", by reference to items 4.2 and 4.3 of the EIS. Item 4.2 dealt with liquid effluents and their control; item 4.3 dealt with "generation and disposal of solid waste". It referred to "dross formation" as a product of the melting furnaces and noted: "Dross tubs when full will be transferred under weather proof cover to the dross storage area for cooling prior to charging into the rotary furnace." 23 The relevance of these references to aluminium dross, according to Weston Aluminium, arose from the classification of dross in the PEO Act (not then in existence) as a hazardous substance which, when it comes in contact with water, may emit flammable gases. Accordingly, it was a substance the creation and disposal of which, it was suggested, specifically required development consent. The development consent for the remelting facility thus indicated an approval for the use of dross produced on site in the rotary furnaces, but, by implication, indicated that other dross, generated elsewhere, would need separate express permission to form part of the feedstock for the rotary furnace. 24 Putting to one side the proposed negative implication, no clear conclusion can be obtained in relation to the permitted feedstock of the rotary furnace, from a development consent which treated the rotary furnace as an existing part of the facility currently operating under earlier consents. Lloyd J appears to have accepted the limited relevance of the reference to dross in consent 81/254 and noted that the transfer of dross generated on site to the rotary furnace merely continued previous practice. His Honour continued at [41]: "Apart from that, [Alcoa] is limited to the express terms of the development consent no. 80/40." 25 The development referred to in consent no. 80/40 was the establishment of "a can reclamation plant, consisting of 1 bag house, 1 rotary furnace, can reclamation and storage areas together with a can buy-back centre". Because it involved the erection of the rotary furnace known as "RF 2", being a replacement for the rotary furnace which had operated on the section of the land south of the Nelson Road, this consent was correctly identified by his Honour as the document of primary relevance to the operation of the new rotary furnace and the permissible feedstock for that furnace. 26 One curious aspect of the case is that RF 2 no longer operates, and appears not to have operated at any time during which dross has been imported from Point Henry. On 17 December 1997 the Council of the City of Holroyd wrote to Kaal Australia, the joint venture company, in the following terms: "I refer to your letter dated 20 November 1997 regarding the replacement of your current No. 2 Rotary Furnace with a new Tilting Rotary Furnace (RF 3) in April 1998. Council has no objection to the abovementioned works subject to approval being granted by the New South Wales Environment Protection Authority, details of which are to be submitted to Council, prior to the installation of the furnace. Please note that a building application will be required if any structural alterations to the building are involved."

Neither the letter of 20 November 1997 from the company to the Council, nor any other material relating to RF 3 was before the Court. Both parties approached the issue on the assumption that RF 3 could lawfully operate within any constraints imposed on the operation of its predecessor, RF 2. 27 Two other development consents should be noted, before returning to the effect of consent 80/40. First, there was a prior consent identified as no. 80/5, which development consent 80/40 "superseded". The earlier consent was given on 4 January 1980, some six weeks before consent no. 80/40. It was not contained in the papers before this Court and nothing appears to turn on it. 28 Secondly, there was reference to a subsequent consent, no. 80/92, given on 9 April 1980 which stated that the Council granted consent "for the erection of extensions to the previously approved can reclamation and by-back centre". Condition 21 stated that "no consent is given or implied for any development other than stage 1 works" shown on a specified plan. The plan identified appears to be that which set out the works approved in consent 80/40: there is, however, another plan included with an approval for an amended building application, dated 1 May 1980, which appears to set out the relevant extensions. However, again, nothing turns on this apparent error. 29 Although each of the relevant consents referred to "the erection of" certain facilities and stated that "no consent is given or implied for any other industrial activity", it appears that the consents do extend to the operation of the facilities, because the conditions are clearly intended to apply to operating facilities. The argument on both sides adopted that approach. 30 The survey of the relevant development consents may be completed by reference to consent 74/43, dated 4 February 1974. The consent granted was for "the erection of a rotary furnace and a pollution control device". The consent dealt with the first rotary furnace (known as RF 1) erected on the southern side of Nelson Road. The development application was not in evidence. The conditions provide no information relevant to the operation of the rotary furnace.

Reasoning in Land and Environment Court 31 The approach of the primary judge may broadly be divided into three parts. The first part of his Honour's reasons set out matters of background to the development of the site and the transfer of the rotary furnaces and melting furnaces from south of Nelson Road to the north side of Nelson Road in 1980: [6]-[21]. The second part of the judgment dealt with the development consents relating to the "remelt facility" and particular consent no. 81/254. His Honour treated the incorporation of those parts of the EIS dealing with "disposal of liquid effluents and solid wastes" and requiring such disposal to be "strictly in conformity with the details set out items 4.2 and 4.3" as incorporating the "disposal" of dross by processing the dross in the rotary furnace. Condition 19 is somewhat unclear as to which elements of items 4.2 and 4.3 of the EIS were being incorporated by reference. To the extent that item 4.3 dealt with "solid waste disposal" in 4.3.3, it might be thought that this was the sub-item being picked up by condition 19. It dealt with disposal of slag and bag house dust and solid waste from the metal filter, which are identified as solid waste to be disposed of off-site. There was no express reference to "disposal" of dross. Nevertheless, nothing turns on this aspect of his Honour's reasoning, set out at [32] in his judgment. 32 The third part of his Honour's judgment concerned the operation of the rotary furnace, which was assumed to be pursuant to consent 80/40. After referring to the development application which gave rise to that consent, his Honour continued at [42]: "As I have said, that was for a can reclamation plant and 'no consent is given or implied for any other industrial activity'. So we have here a case where we have a can reclamation plant with a rotary furnace processing cans, as it is permitted to do, and processing dross from the remelt facility on the adjoining land as it is not only permitted but required to do. That is the extent to which the respondent is permitted to have an input by way of feedstock into the plant at the can reclamation plant." 33 The effect of this finding was that Alcoa was not entitled to process dross in the rotary furnace if the dross were obtained from any source other than the melting furnaces at Yennora. That conclusion appears to have been reached on the basis of three propositions, namely:

(1) previous practice, as existing at the time of the development application in 1980, did not involve processing dross from other sources;

(2) the absence from the application of any reference to the importation of dross from the Point Henry facility, and

(3) the description of the development in development consent 80/40 as the erection of "a can reclamation plant" with certain elements, including a rotary furnace.

Relevant legal principles 34 One issue debated at some length on the hearing of the appeal, concerned the propriety of reference to the development application and accompanying documents, for the purpose of construing a development consent. A related but separate issue, which was not expressly addressed, concerns the relevance of previous practice of the applicant, or its predecessors, in conducting certain activities on the land or land adjoining the land to which the development application related. The issues raised by reliance on documents other than the consent itself, are relevant to this question. 35 In House of Peace Pty Ltd v Bankstown City Council (2000) 48 NSWLR 498 Mason P referred to the relevant principles at [23]: "Emphasis upon the use as distinct from the person using the land reminds that a consent operates in rem . In an oft-cited dictum, Else-Mitchell J described a development consent as 'not personal to the applicant but enur[ing] for the benefit of subsequent owners and occupiers, and in some respects ... equivalent to a document of title': ( Ryde Municipal Council v The Royal Ryde Homes (1970) 19 LGRA 321 at 324). In Eaton & Sons Pty Ltd v Warringah Shire Council (1972) 129 CLR 270 at 293, Stephen J described a consent as 'essentially impersonal in the sense that it does not concern itself with and is not limited to the applicant but is a consent to the world at large in relation to the land which is its subject. Once granted it makes lawful, in a town planning context, what would otherwise be unlawful but does so by reference to the acts done and not to the identity of the actor'."

At [37], Mason P stated: "The search is not for what the Council actually intended or what, if it had been interrogated about various possibilities, it would have said it intended. As an instrument having the characteristics referred to by Else-Mitchell J and Stephen J in the passages cited at par [23], it must speak according to its written terms, construed in context but having regard to its enduring function." 36 His Honour also approved the principles of interpretation expounded by Hope J in Auburn Municipal Council v Szabo (1971) 67 LGRA 427. If it be relevant, the discussion in Szabo, and in House of Peace, concerned consents given under the Local Government Act 1919 (NSW). Consent 80/40 was also given under that Act. In Szabo, at 433-434, Hope J stated, after reference to earlier authority: "It is apparent from these decisions that in determining what a Council has approved, one primarily looks at the document constituting the approval, and construes it. The necessity to do this arises, inter alia, from the fact that a development approval does not enure only for the benefit of the applicant. It enures for the benefit of all future owners or occupiers, and it would create a confusing and difficult, if not impossible, position if in order to determine what a Council had approved one had to go to a whole series of documents and try to determine which of the documents and which part of any particular document the Council intended to incorporate in its approval. The terms of another document may be incorporated in a development approval either expressly or by necessary implication, but I do not think that it is possible otherwise to go to documents outside the formal approval in order to determine what has been approved. In particular, it is not possible to go to the form of application for approval unless in some way that document has in whole or in part, expressly or by necessary implication, been incorporated in the consent." 37 The factual context in which a consent is given, which may or may not be recorded in a document before Council at the time of the grant, is likely to raise matters of far greater difficulty, with the possibility of far greater potential confusion, than reference to the application itself. Such an exercise might be necessary if a consent authority expressly approved an application on the basis of a continuation of previous practices. In such a case, one would expect that the particular practices might be identified. The preferable approach would be to specify the practices in the condition requiring no variation. In any event, that is not this case: the Council did not purport to limit activity on the site by reference to some aspect of previous practice. Accordingly, no assistance is to be found in existing practices as to the feedstock used in the rotary furnace, prior to 25 February 1980. Indeed, there is no agreed fact, nor finding of fact, as to what the Council itself knew about the feedstock or even whether it thought the content of the feedstock a relevant factor. 38 At [39] Lloyd J held that "in order to determine what is consented to one is entitled to look at the development consents and any documents which may be referred therein expressly or by inference". His Honour's conclusion appears to refer back to [25], where he held, in relation to consent no. 81/254, that he was entitled to look at the development application because the consent referred to the development application. 39 That conclusion has broad ramifications: it is common practice for a consent to refer to the application to which consent is being given. However, it is doubtful that the existence of a reference to another document in a consent is to be treated, generally, as incorporating the contents of the other document. In this respect, his Honour adopted the approach of Hemmings J in the Land and Environment Court in Halglide Pty Ltd v PT Ltd (1990) 71 LGRA 215. In that case Hemmings J appears to have treated the approach in Royal Ryde Homes as "legalistic" and as distinguishable because it, and those cases which applied it, dealt with consents which preceded the EPA Act: at p 219. In relation to an application under the EPA Act, his Honour appears to have preferred a more relaxed approach to incorporation by reference, said to be derived from the judgment of Holland J in Wollongong City Council v Australian Iron and Steel Pty Ltd (1988) 67 LGRA 51 at 57, although Holland J only referred to the application and the environmental impact statement to confirm the opinion he had already reached without reference to them: p 54. However, it is doubtful whether the result in that case could have been achieved by applying the principles established in Royal Ryde Homes. There the Council had approved a development application for an industrial laundry, stating that it had "approved the development application". The application contained a reference to limited hours of operation; however, the Court held that, in the absence of an express condition to that effect, the hours of operation were not so limited. 40 To the extent that, in the present case, Lloyd J held that he could refer to the application and the environmental impact statement in determining the scope and effect of consent 81/254, that approach required the principle identified in Halglide to be applied, not because they were incorporated by the document recording the consent of the Council, but because they were referred to in the covering letter sent to the applicant. The document headed "Development Consent No. 81/254", contained no reference to the development application as such. 41 At [41] his Honour stated that the importation of dross from the Point Henry facility "was not part of the development application" which resulted in consent no. 80/40. The basis for that statement might perhaps be inferred, as a matter of fact, from other evidence indicating that it was only in 2000 that Kaal Australia (not Comalco) decided to process Point Henry dross. However, that fact cannot be inferred from the "development application" for consent no. 80/40, because it was not in evidence. Nor does that consent refer to any other document, except the plan received by Council on 16 January 1980: see condition 20. 42 A similar problem exists in relation to consent 80/92. Again, there is no reference to the development application in the consent, other than a reference to the plan in condition 21. It is possible that his Honour's reference to the development application was in fact a reference to the letter of 27 February 1980, which was a letter accompanying a development application which resulted in consent 80/92. (Again, however, with the exception of the plan, the application was not in evidence.)

Construction of consent 43 It may be accepted that there was no application in 1980 or 1981 to use dross imported from places beyond Yennora as feedstock for the rotary furnace. Weston Aluminium sought to combine that fact with the consent for the erection of a "can reclamation plant" as impliedly limiting the feedstock of the rotary furnace to recycled aluminium cans. However, that would involve giving ordinary words used to provide a brief description of a plant a precise and restrictive connotation equivalent to the imposition of a condition that the facility be used for processing used aluminium cans and no other form of aluminium product. One reason for not giving such a precise meaning to the description is that it is expressed as "stage 1", from which it may be inferred that the elements, namely the bag house, rotary furnace, and storage areas, are part of a larger development. No argument was put that the Court is not entitled to look at related development consents. When one does so, it is apparent that the rotary furnace was used to provide aluminium feedstock for the melting furnaces. In other words, the rotary furnace and the melting furnaces were part of a single overall development. Secondly, development consent 80/92, which involved extensions to the development approved in 80/40, described the proposal as "extensions to the previously approved can reclamation and buy-back centre". The variation in terminology is inconsistent with any intention that such brief descriptions were definitive of the precise scope of the development. 44 Thirdly, treating the development as a whole, it is necessary to explain why the consent for the rotary furnace should be construed differently from that for the melting furnaces. Consent 81/254 granted consent for "an aluminium remelting facility generally in accordance with plans submitted to Council". No condition in that consent relates to the feedstock for the melting furnaces; nor do the plans contain such detail. Apart from the output of the rotary furnace, the aluminium feedstock for the melting furnaces might come from sources outside the Yennora plant. Weston Aluminium does not deny that construction. One might infer as much from the large area of "covered scrap storage" which forms part of the plan. If, as Weston Aluminium submits, reference to the EIS for that application is permissible and appropriate, one learns that the input to the melting furnaces comes from scrap, the sources for which are described as both "regional and internal", recycled secondary ingots from the rotary furnace, molten aluminium from the rotary furnace and "primary aluminium" from the Bell Bay smelter in Tasmania. If the Council had wished to limit the sources of feedstock for the melting furnaces it might have done so. It did not and no reasonable basis is shown for the implication that the only permissible sources are those which existed at the date of that development consent, namely 4 September 1981. The inference is that the Council did not intend to impose a limitation, by way of condition or by its description of the respective developments, on the source of feedstock, either for the melting furnaces or for the rotary furnace. 45 There is, no doubt, a separate question as to whether the acceptance at Yennora of dross transported from other sites constitutes an activity which requires a separate development consent pursuant to Part 4 of the EPA Act. However, that was not the matter pleaded, or addressed, in the Land and Environment Court. As noted above, the class 4 application sought a declaration as to the use of the land "for the processing of aluminium dross …". Consistently, the points of claim filed for the applicant in the Land and Environment Court relevantly identified the unauthorised development as the processing of aluminium dross in the rotary furnace: pars 16-19. Finally, the issue identified by the applicant as requiring determination by the Land and Environment Court, referred to by Lloyd J at [4], was whether Alcoa could lawfully "treat, process or reprocess" material other than: "(a) used beverage cans pursuant to development consent 80/40 dated 25 February 1980; and (b) aluminium dross produced by Stage 1 of the remelt facility erected [on the adjoining land] pursuant to development consent 81/254 dated 4 September 1981?"

However, one result of the limited way in which the operation of the consents was raised before Lloyd J is that a conclusion with respect to that issue may not answer the separate question which could have arisen in the proceedings before Pain J, namely whether the consents which existed at the time of the variation of the licence granted under the PEO Act, covered the acitivty sought to be the subject of the varied licence. 46 Dealing with the matter as presented below, Weston Aluminium must establish that it was an implied condition of the consent to the erection and use of the rotary furnace (RF 2) that the feedstock for the furnace be limited to recycled aluminium cans and aluminium dross produced by the melting furnaces at Yennora. I am not persuaded that such a condition should be implied. Accordingly, in my view the conclusion reached by Lloyd J in the Land and Environment Court was in error. The application before his Honour should have been dismissed. No argument has been presented as to why Alcoa should not have its costs of those proceedings in the Land and Environment Court.

Variation of licence 47 On 21 September 2000, whilst Alcoa was operating the Yennora facility as a joint venture with Kobe Steel Ltd, the joint venture company, Kaal Australia, wrote to the Environmental Protection Authority seeking a variation of licence no. 642. The letter stated: "The application to vary our licence has been made to include, a new scheduled activity number 84 'waste storage, transfer, separating or processing' and amendment or deletion of condition number L5.1, to allow the acceptance and use [of] dross from our Point Henry Kaal facility at Yennora in our rotary furnace. As discussed in our previous fax …, we are currently processing some of our own dross in the rotary furnace, when used beverage cans (UBCs) are in low supply. Dross contains about 70% aluminium and 30% aluminium oxides. Dross is categorised as a … hazardous substance, as it may emit a [flammable] gas when it is wet. The recycling of this material makes far less impact on the environment than UBC recycling which requires the burning off of lacquer and paint. The treatment of Point Henry dross in the rotary furnace will not increase air emissions, and we are operating and will remain operating within our EPA licence limit." 48 The author expressed the expectation that the volume of dross from Point Henry "would not exceed 5,000 tonnes per year".

Licensing scheme 49 In order understand the potential significance of the licence, and variations thereto, it is necessary first to refer to aspects of the legislative scheme of the PEO Act. 50 The need for a licence, relevantly for present purposes, is dealt with in s 48 of the PEO Act which provides (and provided in 2000-2001): 48 Licensing requirement - scheduled activities (premises-based) (1) Application of section This section applies to scheduled activities where Schedule 1 indicates that a licence is required for premises at which the activity is carried on. (2) Offence A person who is the occupier of any premises at which any such scheduled activity is carried on is guilty of an offence, unless the person is, at the time that activity is carried on, the holder of a licence that authorises that activity to be carried on at those premises.

The section then provides a maximum penalty, the amount of which was substantially increased by amendment of the Act in 2005. 51 The term "scheduled activity" is defined in the Dictionary to mean an activity listed in Schedule 1. Part 1 of Schedule 1 identifies a number of activities which may be undertaken at particular premises, and which require the occupier to hold a licence. Under the heading "Waste facilities" a number of classes of facilities are identified; relevantly for present purposes that classification provides: Waste facilities (1) A waste facility that is any one or more of the following classes: (a) hazardous, … waste processing facilities , being waste facilities that treat, process or reprocess hazardous waste …, except those : … (ii) that only treat, process or reprocess waste that is generated on site, … (d) w aste storage, transfer, separating or processing facilities, being waste facilities that store or transfer, or recover by way of separating or processing, more than 30,000 tonnes of waste per year. 52 It is also necessary to note a further scheduled activity identified as "waste activities" in Schedule 1 and defined as follows: Waste activities (1) Hazardous, … waste generation or storage , being any activity that: (a) is carried on for business or other commercial purposes, and (b) involves the generating or storage of any one or more of the following types of waste: (i) hazardous waste … .

There are then a number of exceptions not of direct relevance, but referring to the generation of limited quantities of particular wastes, calculated as tonnage per year, and the storage of limited quantities of waste, calculated in tonnage "at any one time". 53 The term "waste" is defined in the Dictionary to the PEO Act as including - (b) any discarded, rejected, unwanted, surplus or abandoned substance, or (c) any otherwise discarded, rejected, unwanted, surplus or abandoned substance intended for sale or for recycling, reprocessing, recovery or purification by a separate operation from that which produced the substance". 54 The term "hazardous waste" is defined in Part 3, Div 2 of Schedule 1 as including "non-liquid waste that is … specified in Part 3 of the following Appendix". Part 3 of the Appendix requires that certain criteria be met and the waste be characterised in one of a number of ways, including - (f) substances which in contact with water emit flammable gases.

Although it does not appear in the statement of agreed facts, it appears to have been assumed for the purposes of the proceedings that "dross" fitted this definition.

Variations to the licence 55 Having established the circumstances in which a licence is required, it is convenient to turn to the terms of licence of no. 642, so far as relevant, and the variations which appear to have occurred in November 2001. 56 As noted above, the company's application for variation identified two changes proposed. One was the inclusion of a "new scheduled activity", identified in terms which picked up par (d) of the definition of "waste facilities", as set out above. That would have required a change to item A1.2 of the licence, which contained two tables, one headed "Scheduled Activity" and one headed "Fee Based Activity". 57 The clause in the licence identified by the company as requiring amendment or deletion, namely clause L5.1, read as follows: "The licensee must not cause, permit or allow any waste generated outside the premises to be received at the premises for storage, treatment, processing, reprocessing or disposal or waste generated at the premises to be disposed of at the premises, except as expressly permitted by the licence." 58 In a statement headed "Notice of variation of licence 642", dated 29 November 2001, under the heading "Background", a delegate of the Authority stated: "(b) On 29 September 2000 the EPA received an application for the variation of the licence to allow the acceptance and use of dross from another Kaal premises. The EPA has assessed the application and has no objection to the dross being used in the rotary furnace."

Although L5.1 was not amended as requested, it is apparent that the intention of the Authority was to permit the activity sought to be carried on at Yennora. Presumably the exception at the end of L5.1 was thought to provide the mechanism for allowing the activity. 59 The only copy of licence 642 in evidence was the licence as varied, the notice accompanying the licence indicating that deletions were indicated by striking through the relevant words and additions were indicated by double underlining. The markings, indicated on a document entitled "Licence Variation Appendix" demonstrate no relevant change to items A1.2 or L5, nor to any other potentially relevant clause to which the Court's attention was drawn. This is a matter of some consequence, because it is not possible to determine the validity of the variation without identifying the variation. 60 In the Land and Environment Court, Pain J identified the variation in part in the following terms at [8]: "On 29 November 2001, the EPA issued a Notice of Variation which, inter alia, purported to vary licence 642 to include as a new scheduled activity 'waste facility' being 'waste storage, transfer, separating or processing'. 'Dross' was included as a waste material which could be stored and/or processed (a new 'scheduled activity'). There is no reference in the licence document to where any dross is to come from." 61 After reaching her conclusion as to variation, her Honour later set out, at [18], the explanation given in the notice for the indication of variation, by strike through and double underlining, and then set out item L1.5 in a form which accorded with the indications of variation: at [19]. However, perhaps significantly, at [20] her Honour set out item A1.2 but, implicitly acknowledging the absence of any indication of variation contained in the original document, added her own indication of variation by way of italics. The basis for reaching that conclusion was not identified. 62 Her Honour then stated at [21]: "Prior to variation, the licence did not allow the processing of any waste generated outside the premises including dross at Yennora (see par L5.1 and L5.2 of the licence). Conditions L5.3 to L5.6 inclusive are new conditions. After the licence was varied the prohibition on processing waste in L5.1 was displaced by par L5.3, L5.4, L5.5 and L5.6."

These statements were inexplicable on the basis of the material which her Honour had set out in the immediately preceding paragraphs, where her Honour had adopted the indications of variation to item L5 (with the exception that she had used single underlining for the double-underlining appearing in the text of the variation notice). If there was some reason for thinking that item L5 was restricted to L5.1 and L5.2, prior to the variation, the strike through of L5.5 and part of L5.4 is unexplained. 63 Item A1.2 of the licence variation appendix, lists three scheduled activities, namely: "Mineral Processing or Metallurgical Waste Activities Waste Facilities - store/transfer/sep"

The words "Waste Storage, Transfer, Separating or Processing" appear under the heading "Fee Based Activity", not under the heading "Scheduled Activity". The Points of Claim filed by Weston Aluminium and admitted by Alcoa, refer to the variation as addition of "a new scheduled activity being a waste facility that involved 'waste storage, transfer, separating or processing'": par 8. 64 There is no indication in item A1.2, of any variation, nothing being indicated by a strike through of words deleted and double underlining of material added. As will be seen, there is no indication of any relevant change to item L5, dealing with waste, which might suggest an amendment to A1.2. Thus, generation and storage of "hazardous, industrial or group A waste", encompassed by the scheduled activity "waste activities" was and is covered by item L5.4 in the licence. By contrast, the activity which falls within par (d) of the definition of the scheduled activity known as "waste facilities" was, and still is, contained in item L5.5. 65 Weston Aluminium identified in its Points of Claim no specific variation other than that at item A1.2. In its defence, Alcoa alleged a further variation in relation to L5.5 and L5.6, which are said to "relate (among other things) to … dross from the Point Henry facility": par 5. However, the variation is said to have occurred between 14 September 2000 and 2 November 2000. No evidence supported any amendment in that period. The actual amendments made to item L5 are important and should be set out with the indications of variation contained in the licence variation appendix, as it appears in the evidence. (The only aspect not reproduced is the highlighting which appears with each particular change, but is entirely limited to material either struck through or double-underlined.) L5 Waste L5.1 The licensee must not cause, permit or allow any waste generated outside the premises to be received at the premises for storage, treatment, processing, reprocessing or disposal or any waste generated at the premises to be disposed of at the premises, except as expressly permitted by the licence. L5.2 This condition only applies to the storage, treatment, processing, reprocessing or disposal of waste at the premises if it requires an environment protection licence. L5.3 Except as provided by any other condition of this licence, only the hazardous and/or industrial and/or Group A waste listed below may be generated and/or stored at the premises. a) Waste mineral oils unfit for their original intended use , b) Waste oil/water, hydrocarbons/water mixtures or emulsions , c) Filter cake , d) Residues from industrial waste treatment/disposal operations , ;and e) Substances which in contact with water emit flammable gases (aluminium salt slag, dross) L5.4 The quantity of hazardous and/or industrial and/or Group A waste generated and/or stored on at the premises must not exceed 15000 tonnes at in any one time . L5.5 Except as provided by any other condition of this licence, only the hazardous and/or industrial and/or Group A and/or Group B waste listed below may be treated, processed, reprocessed or disposed of at the premises year 15000 tonnes per year . L5.5 Except as provided by any other condition of this licence only the hazardous and/or industrial and/or Group A and/or Group B waste listed below may be treated, processed, reprocessed or disposed at the premises. Substances which in contract with water emit flammable gases (dross) L5.6 The quantity of hazardous and/or industrial and/or Group A and/or Group B waste treated, processed, reprocessed or disposed of at the premises must not exceed 5000 tonnes per year. 66 The changes thus noted in the licence variation appendix, have two effects: the first is to limit generation and/or storage to 15,000 tonnes per year: the second is to rationalise what appears to have been a discrepancy between L5.5 and L5.6, the former permitting treatment and processing of 15,000 tonnes per year and the latter permitting treatment and processing of 5,000 tonnes per year. It may be that there has been an error in the preparation of the licence variation appendix. Thus, it would be curious if the company had applied for variation by adding a new scheduled activity, when in fact it did not need to do so. On the other hand, Alcoa apparently does not have a copy of licence 642, prior to amendment in November 2001. There is no evidence as to whether it had a copy of the licence at the time it sought the variation. Accordingly, there is no evidence as to why it sought the variation. Whilst one may speculate as to whether the licence variation appendix in fact records the variations made, I could not be satisfied on the available evidence that the variation identified by her Honour was in fact made in November 2001. 67 It must be said that there is something very odd about the terms of the licence as varied, if one reads the licence without knowledge of the quantities referred to in the application. Thus, item L5.4 permits the generation and storage of 15,000 tonnes per year, but item L5.6 allows for the treatment or disposal of only 5,000 tonnes per year. It is no doubt physically possible to comply with these conditions, but they make no practical or commercial sense. 68 There appears to have been no evidence as to the volume of waste processed in the years prior to the variation application. Nevertheless, given the definition of waste stated above, it seems implausible that the new scheduled activity was that of "waste facility", because it seems likely that the Yennora plant had fallen within par (d) of that definition for many years, or even decades. Because dross is a hazardous waste, and there is no limitation by amount on the storage of hazardous waste, the new activity may have fallen within the definition of "waste activities". However, that was not what was pleaded, nor what her Honour found to be the variation made and it was not the variation for which the company applied.

Issues for determination 69 Despite these uncertainties, the parties were content to approach the case on the basis that there was some new "scheduled activity" included to which end the licence had been varied. The argument presented to her Honour was identified in terms about which no complaint was made in this Court, at [17]: "Two issues arose for determination in these proceedings: (1) Does s 50(2) of the POEO Act apply to the variation of licences pursuant to s 58 of the POEO Act? (2) If s 50(2) does apply to the variation of a licence under s 58, is the existence of development consent a jurisdictional fact under s 50(2) of the POEO Act?"

Statutory regime for grant and variation of licences 70 The reference to s 50(2) requires consideration of the section as in force at the date of the variation, namely 29 November 2001. At that time, s 50, so far as relevant, read as follows: 50 Timing of licensing of development requiring consent under EP&A Act (1) Licensing of development controlled under EP&A Act This section applies to development that cannot be carried out without development consent under the Environmental Planning and Assessment Act 1979 . This development is called controlled development in this section. (2) Licence to be concurrent A licence that relates to controlled development must not be granted by the appropriate regulatory authority, unless development consent has been granted for the controlled development. However, this section does not prevent the consideration of a licence application by the appropriate regulatory authority before development consent is granted. 71 It should be noted that sub-s (2) has since been amended to include, after the word "granted", first appearing, the words "or varied (other than on the initiative of the EPA)". While this amendment would resolve the first question posed for determination differently from the conclusion reached by the primary judge, that cannot affect the outcome for the purposes of the present proceedings. In fact, the first difficulty with the question as formulated is that it is in the present tense and therefore seeks to address the question of construction at the wrong time. 72 The next issue in relation to sub-s (2) is to identify the purpose of the second sentence of the subsection. That purpose is not merely to provide administrative certainty to allow consideration to be given before a decision can be made, and thus perhaps to avoid undue delay, but rather is central to the legislative scheme. Pursuant to s 51 of the PEO Act the issue of a licence in relation to "integrated development" is subject to the provisions of the EPA Act. According to s 91 of the EPA Act, "integrated development" is development that requires both development consent and approval under one of a number of other specified legislative provisions, which, relevantly for present purposes, include s 55 of the PEO Act, being the section pursuant to which an application for the issue of a licence is granted or refused. Pursuant to s 91A of the EPA Act, the consent authority, before granting consent, must obtain from the licensing authority "the general terms of any approval proposed to be granted … in relation to the development". The development consent must be consistent with the general terms of such proposed licence approval: s 91A(3). If the licensing authority informs the consent authority that it will not grant approval, the development application must be refused: s 91A(4). However, if the licensing authority fails to inform the consent authority whether or not it will grant approval and if development consent is granted, then a licence must be granted consistent with the development consent: s 91A(5). This scheme expressly requires the licensing authority to consider, but not determine, the application before it and to advise the consent authority accordingly. Where development consent is given, the licensing authority must grant its approval, but in terms which are not inconsistent with the development consent: s 93(2). Thus each element of s 50(2) of the PEO Act, namely the prohibition on granting a licence prior to the grant of development consent (if required) and the permission to consider the application for a licence, prior to the determination of the development application, is an essential concomitant of the scheme for integrated development set out in the EPA Act. 73 An additional feature of the regime created by the PEO Act involves the power of the authority to vary a licence, pursuant to s 58 of that Act. That section provides (and provided at the relevant time): " 58 Variation of licences (1) The appropriate regulatory authority may vary a licence (including the conditions of a licence). (2) A variation includes the attaching of a condition to a licence (whether or not any conditions have already been attached), the substitution of a condition, the omission of a condition or the amendment of a condition. (3) A licence may be varied on application by the holder of the licence or on the initiative of the appropriate regulatory authority. (4) A licence may be varied at any time during its currency, including on its being transferred to another person. (5) A licence is varied by notice in writing given to the holder of the licence. (6) If: (a) the variation of a licence will authorise a significant increase in the environmental impact of the activity authorised or controlled by the licence, and (b) the proposed variation has not, for any reason, been the subject of environmental assessment and public consultation under the Environmental Planning and Assessment Act 1979 , the appropriate regulatory authority is to invite and consider public submissions before it varies the licence. 74 Neither s 50 (as in force in November 2001), nor s 51 refers to the variation of a licence, as opposed to its grant or issue. (The terms "grant" and "issue" appear to be used interchangeably in Chapter 3, Part 3 of the PEO Act.) Similarly, the definition of integrated development in the EPA Act picks up, relevantly for this case, the power to grant or refuse an application for the issue of a licence, under s 55 of the PEO Act. This overall legislative regime gives rise to an issue of construction in circumstances where a new activity is proposed, which requires development consent and a licence under the PEO Act, but the activity is to be carried out on premises which are already the subject of a licence granted under s 55 of the PEO Act. There are three possible constructions available:

(1) because the licensing authority can effectively grant the relevant licence by a variation of the existing licence, the development is not an integrated development and the provisions of neither s 50 nor s 51 applies;

(2) because the scheme of integrated development is posited upon the requirement to obtain both development consent and a licence under the PEO Act, the power to vary an existing licence under s 58 does not extend to the approval of a new activity which requires development consent, or

(3) as an intermediate position, the power of variation is available, but only in relation to new scheduled activities which involve an intensification of an existing approved development. 75 A literal reading of the statutory provisions indicates that the scheme for integrated development will not apply where all that is sought is the variation of an existing licence. On the other hand, the clear purpose of that scheme, which involves consistency between a development consent and a licence applying to activities on the same land, suggests that it is not intended to be sidestepped merely because, perhaps fortuitously, a licence exists in relation to a different activity carried out at those premises. It follows that the power of variation granted by s 58 should not be treated as permitting variation so as to grant a licence in respect of a new scheduled activity. 76 A contrary conclusion can readily be seen to give rise to anomalous results which would be entirely subversive of the legislative policy underlying the scheme. Thus, there are several sorts of "hazardous waste" identified in Part 3 of the appendix to Schedule 1, including explosives, pharmaceuticals, poisons and radioactive waste. Assuming that both development consent and a licence under the PEO Act provide, consistently, for the use of land to store waste involving pharmaceuticals and poisons, if the licensing authority could determine independently that the licence should be varied to allow for the storage of explosives or radioactive wastes, and development consent is not forthcoming, or not forthcoming on the same conditions, there will be an immediate inconsistency of precisely the kind which the statutory scheme is designed to avoid. 77 Nor is it easy to suggest criteria by which some new scheduled activities might be approved by way of variation to a licence, whereas others might not. The example given was limited to different forms of hazardous waste, and thus different forms of the same class of scheduled activity. There is no express or implied criterion which would allow maintenance of the statutory scheme whilst permitting variations to allow some class of scheduled activities which required development consent, but not others. 78 This, however, was not the approach adopted by the primary judge. Her Honour did not come to deal with the first issue which had been identified for determination until [48] of the judgment. (Other matters were dealt with, which appear to have been the subject of extensive argument, but which do not appear to have any direct bearing on the construction of the PEO Act.) Her Honour's conclusion with respect to the first issue was succinctly stated at [50]: "The Second Respondent argued that s 50(2) was essentially a timing provision to ensure that when a new licence was issued under the POEO Act for a scheduled activity that is also controlled development that development consent was granted first. When the provisions of s 50 and s 58 are read as a whole I agree with that submission. There are two separate regimes provided for new licences and variation of licences. One does not apply to the other." 79 That conclusion provided an answer to the question as formulated, which is not inconsistent with the reasoning set out above. However it also demonstrates the inadequacy of the question: the real issue is whether s 50(2) applies with respect to a variation which has the effect of including within the licence a new scheduled activity of a kind which would constitute a development requiring development consent under the EPA Act. The answer to the latter question may be found in the following paragraph of her Honour's judgment, where it is treated as a logical corollary of the answer set out above. The further conclusion at [51] was based upon an implication from the terms of s 58(6): "Section 58(6)(b) of the POEO Act clearly contemplates a situation where an application for a variation of a licence is considered by the appropriate regulatory authority before development consent for a scheduled activity that is controlled development has been granted. It follows that s 50(2) does not apply to the variation of licences under s 58 of the POEO Act." 80 Dealing with the reliance on s 58(6)(b) first, the logic of the argument must be rejected. There is no doubt that s 50(2) permits "the consideration of a licence application … before development consent is granted": the second sentence expressly says so. Accordingly, her Honour's reference to s 58(6) contemplating consideration before a development consent is granted carries the matter no further. On the other hand, s 58(6) could be seen as an implied permission to vary a licence before there has been relevant assessment under the EPA Act, so long as the licensing authority invites and considers public submissions. Nevertheless, this conclusion says nothing about the inclusion of a new scheduled activity, which requires development consent: it may constitute an additional requirement, not inconsistent with s 50(2). 81 Further, a quite different inference may be derived from s 58(6), read in context, from that derived by the primary judge. Section 58(6) contemplates a variation of a licence authorising an increase in the environmental impact of "the activity" authorised or controlled by the licence. A licence must identify the relevant scheduled activity and relate to premises at which "the activity" is carried on: s 48(1). It may be, of course, that a licence can identify a number of scheduled activities, especially where there is possible overlap or uncertainty as to which particular scheduled activity is applicable. However, it does not follow that a licence can be varied, pursuant to s 58, to add a new and different scheduled activity, or even an activity falling within the same class, but for a different reason. That would not be consistent with the express reference to "the activity", and to variation of conditions relevant to that activity. 82 The very existence of the prohibition in s 50(2) on the grant of a licence unless and until a relevant development consent has been granted, indicates an implied limitation on the scope of a variation. Accepting that s 58, dealing with variations, has no such express limitation, the proper construction of the statute suggests that the addition of a new scheduled activity to an existing licence cannot be done by way of variation if the effect is to permit the licensing of the activity absent the grant of a necessary development consent. 83 For these reasons, the precise nature of the variation made in November 2001 was of critical importance to the application for a declaration of invalidity. If the variation made involved an activity which was the subject of an existing development consent and did not, therefore, involve a controlled development for the purposes of s 50(1), the prohibition in s 50(2) was not engaged. On the other hand, if there were no sufficient development consent, and the activity was such that it constituted a "controlled development", then the variation was invalid, not because s 58 was subject to s 50(2) but because such a variation could not be made under s 58 in any event. The order made by her Honour was arguably correct, but for reasons other than those upon which she relied.

The effect of non-compliance 84 The second question posited for determination by the primary judge was whether, if s 50(2) did apply, the existence of a development consent was a "jurisdictional fact". Her Honour did not reach that question, because she had answered the first question in the negative. The use of the term "jurisdictional fact" was explained on the hearing of the appeal as raising the question whether the consequence of non-compliance with s 50(2) was invalidity of the variation. 85 On the analysis set out above, the formulation of the question is inapt. If the variation, properly understood, involved "development" requiring consent under the EPA Act, it could not be made under s 58. An absence of power must spell invalidity.

Licence variation: conclusions 86 Because of the approach adopted below, two questions were not adequately addressed, namely:

(a) what was the precise scope of the variation made to licence no. 642 on 29 November 2001?

(b) did the change in use which required variation of the licence constitute a development requiring development consent under the EPA Act? 87 There remains a possible outstanding issue as to the scope of the existing development consents in relation to the acceptance and storage of dross from Point Henry. However, these questions were not addressed on appeal, nor were they raised in the Court below. 88 The procedure before Pain J appears to have involved something analogous to the formulation of separate questions for the determination of the Court. That process, especially when carried out informally, can readily give rise to the identification of false issues, based on unexpressed assumptions. That may have happened in the present case. The uncertainty so identified may be found in the relief sought in the application. The declaration referred to "any licence or notice of variation of licence", and thus did not limit itself to the variation which took place in November 2001. Similarly, the second order sought was a mandatory order requiring the Environment Protection Authority to remove from the licence "those conditions inserted which in any way relate to or concern" the storage or processing of dross from Point Henry. The vagueness of the order sought might have alerted the applicant to matters which needed to be addressed. 89 The exercise undertaken in the Court below having miscarried, there is a question as to whether order 1 made by the primary judge, dismissing the application before her, should be overturned and the matter remitted for further consideration according to law. Such an order would be an invitation to the applicant to present its case on a different basis. That should not be permitted. Accordingly the order dismissing the proceedings should stand, but for the reasons set out above.

Costs 90 Pain J ordered that "costs be reserved" in the proceedings before her. As the application was dismissed, that was not an appropriate order. The erroneous approach adopted below appears to have been the direct result of the manner in which counsel for the applicant formulated the issues which arose for determination. 91 In its notice of appeal, Weston Aluminium sought "costs", which was presumably intended to be a request for an order for costs in this Court and in the Court below. By its written submissions, Alcoa claimed that the appropriate order in relation to the appeal was that it should be "dismissed with costs of the appeal and Court below". It would therefore seem appropriate to set aside order 2 made by her Honour, that costs be reserved and in lieu thereof order that Weston Aluminium pay the costs of the proceedings before Pain J in the Land and Environment Court. The appeal should otherwise be dismissed and Weston Aluminium should pay Alcoa's costs of the appeal. The costs of the application for leave to appeal and the appeal from Lloyd J, should also be paid by Weston Aluminium.

(1) In matter no. 40293 of 2006: (a) grant the Applicant an extension of time within which to seek leave to appeal up to and including the day on which the summons for leave to appeal was filed in this Court; (b) grant the Applicant leave to appeal; (c) allow the appeal and order that the application by Weston Aluminium Pty Ltd filed in matter no. 41622 of 2003 in the Land and Environment Court be dismissed with costs; (d) order the Respondent, Weston Aluminium Pty Ltd to pay the costs of the Appellant of the appeal.

(2) In matter no. 41009 of 2005: (a) allow the appeal and set aside order 2 made in the Land and Environment Court on 9 December 2005; (b) in lieu thereof, order that the applicant in that Court, Weston Aluminium Pty Ltd, pay the costs of the Second Respondent of the application before Pain J; (c) order the Appellant to pay the Second Respondent's costs of the appeal. **********

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.