Andrews v Botany Bay City Council

Mascot Station Precinct Development Control Plan 2004 LEGISLATION CITED: Environmental Planning and Assessment Act 1979 (NSW) Land and Environment Court Act 1979 (NSW)

Anderson v Minister for Infrastructure Planning and Natural Resources (2006) 151 LGERA 229 Andrews v Botany Bay City Council [2007] NSWLEC 716 Baulkham Hills Shire Council v Basemount (2003) 126 LGERA 339 Castle Constructions Pty Ltd v North Sydney Council (2007) 155 LGERA 52 Dogild Pty Ltd v Warringah Council [2008] NSWLEC 53 Fairfield City Council v N & S Olivieri P/L [2003] NSWCA 41 CASES CITED: Lloyd v Robinson (1962) 107 CLR 142 MCC Energy Pty Ltd v Wyong Shire Council (2006) 149 LGERA 59 Newbury District Council v Secretary of State for the Environment [1981] AC 578 Optus Networks Pty Ltd v Rockdale City Council [2005] FCA 200 Save Our Street Inc v Settree (2006) 149 LGERA 30 Stockland Development Pty Ltd v Manly Council (2004) 136 LGERA 254 Western Australian Planning Commission v Temwood Holdings Pty Ltd (2004) 221 CLR 30 Zhang v Canterbury City Council (2001) 51 NSWLR 589

APPLICANT: Mr P Rigg, Solicitor SOLICITORS: Deacons LEGAL REPRESENTATIVES: RESPONDENT: Mr T S Hale SC SOLICITORS: Houston Dearn O'Connor

THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES

JUDGMENT 1 HIS HONOUR: This is an appeal on questions of law under s 56A of the Land and Environment Court Act 1979 against a decision of a Commissioner of this Court modifying a condition of a development consent: Andrews v Botany Bay City Council [2007] NSWLEC 716.

2 On 14 April 2004 the respondent, Botany Bay City Council, granted development consent to an application for the demolition of industrial buildings on land now known as Lot 123 in DP 1103399 at Mascot, and for the construction of a seven storey residential building comprising 95 residential units, one commercial/retail space to O'Riordan Street and parking for 192 vehicles in three basement levels.

3 The land encompasses 149 - 161 O'Riordan Street and 192 - 204 Coward Street, Mascot. The land has an area of 4,171.7m2 and comprises nine consolidated allotments. The land is a parallelogram with a 70 metre eastern frontage to O'Riordan Street, a 58 metre southern frontage to Coward Street and a 65 metre northern frontage to John Street. On the west the development is to be bound by a linear park.

4 At the time of the development consent the land was subject to the council's "Mascot Station Precinct Development Control Plan" (DCP). Development Control C98 provided: At the full cost of the developer, all service cables in the street, adjacent to and within the confines of any development site within the Mascot Station Precinct, are required to be placed underground. 5 Condition 38 of the development consent (as renumbered in subsequent council modifications) provided: Existing above-ground power cables in the street adjoining the site shall be replaced at the applicant's expense by underground cables to the standards of Energy Australia. The applicant shall be responsible for the replacement of existing street lights with new light standards in accordance with Council's Guidelines and the cost of power and additional maintenance to such lights.

The necessary works and payments shall be completed prior to the issuing of an Occupational Certificate. 6 The applicant appealed on the merits to the Court under s 96(6) of the Environmental Planning and Assessment Act 1979 against the council's deemed refusal of the applicant's modification application which relevantly sought deletion of condition 38.

7 At the hearing the council acknowledged that there were difficulties reconciling condition 38 with Development Control C98 and proposed the following alternative condition 38: (a) Existing streetlights located within the footpath reserve along the entire three frontages of the site shall be replaced with new streetlights in accordance with the requirements of Australian/New Zealand Standard As/NZS 1158-1997 "Public Lighting Code"; and (b) The existing overhead service cables in the street adjacent to and within the bounds of the public places that adjoin the development site shall be placed underground at the cost of the applicant in the following manner: (i) Service cables including power lines, telecommunication cables and the like along O'Riordan Street frontage to be underground starting from the existing power pole 'A' to the existing power pole 'C'. Refer to site plan drawing No. 04010 - CC - 01 (ii) Service cables including power lines, telecommunication cables and the like along John Street frontage to be underground starting from the existing power pole 'D' to the existing power pole 'E'. Refer to site plan drawing No. 04010 - CC - 01.

This condition was more onerous than the original condition 38 in that it was not restricted to "power" cables but extended to "service" cables.

8 At the hearing the applicant proposed an alternative condition 38 which was adopted by the Commissioner as follows (judgment [18] and [47]): (a) Existing streetlights located within the footpath reserve along the entire three frontages of the site shall be replaced with new streetlights in accordance with the requirements of Australian/New Zealand Standard As/NZS 1158-1997 "Public Lighting Code"; and (b) The existing overhead service cables in the street adjacent to and within the bounds of the public places that adjoin the development site shall be placed underground at the cost of the applicant in the following manner: (i) Service cables including power lines, telecommunication cables and the like along John Street frontage to be underground starting from the existing power pole "D" to the existing power pole "E". Refer to site plan drawing No 04010 - CC - 01. (c) Along the O'Riordan Street frontage of the site the applicant shall provide below ground conduits to the requirements of the relevant network operator and telecommunications carriers to be available for use for existing service cables. (d) Notwithstanding condition 1 of this consent, this condition details the extent of the applicant's obligations under Control C98 of the Mascot Station Precinct Development Control Plan. (emphasis added) 9 The Commissioner rejected the council's proposed alternative condition 38, holding that it offended validity tests. He allowed the appeal and modified condition 38 by adopting the applicant's proposed alternative.

10 The appeal before me is concerned with condition 38(c). It limits the developer's obligation along O'Riordan Street to providing underground "conduits". This obligation does not extend to placing the existing overhead service cables underground. This is in contrast to condition 38(b) under which the developer's obligation along John Street is to place all "existing overhead service cables" underground within the conduits. There is no obligation to place the existing overhead service cables in O'Riordan Street underground. Thus, the Commissioner's modification defeats Development Control C98 in its application to O'Riordan Street at this location. The C98 objective of placing overhead service cables underground will not be achieved at all in O'Riordan Street at this location or, contrary to the intent of C98, the cost will have to be borne not by the developer but by ratepayers generally.

11 The Commissioner's reasoning, essentially, was that the council's proposed condition 38 did not meet the second and third of the three Newbury tests of validity of a development consent condition and that the applicant's proposed condition 38 was reasonable: Newbury District Council v Secretary of State for the Environment [1981] AC 578 (HL). The authorities relating to the Newbury tests were reviewed in my recent judgment in Dogild Pty Ltd v Warringah Council [2008] NSWLEC 53. The Newbury tests, as adopted and expressed by McHugh J in Western Australian Planning Commission v Temwood Holdings Pty Ltd (2004) 221 CLR 30 at [57], are as follows: A condition attached to a grant of planning permission will not be valid therefore unless: 1. The condition is for a planning purpose and not for any ulterior purpose. A planning purpose is one that implements a planning policy whose scope is ascertained by reference to the legislation that confers planning functions on the authority, not by reference to some preconceived general notion of what constitutes planning. 2. The condition reasonably and fairly relates to the development permitted. 3. The condition is not so unreasonable that no reasonable planning authority could have imposed it. Mascot Station Precinct Development Control Plan 12 The DCP was adopted on 19 December 2001 and was effective from 2 July 2002. The boundaries of the Mascot Station Precinct are shown in figure 1. Figure 5 shows the seven sub precincts. The subject site is in sub-precinct 1.

13 The Mascot Station Precinct has been a traditional industrial area. The DCP at para. 1.4 states: The Mascot Station Precinct is located within this dynamic and evolving environment. The natural transition of the precinct from its traditional general industrial land use base to more intensive forms of employment generating development has been hampered by constraints which include; generally small lot sizes, multiple property owners, zoning restrictions, a restricted road network and limited access associated with the construction of the Mascot Station.

The specific characteristics of the precinct and its relationship to the surrounding area necessitates the need for detailed development controls to ensure future development is appropriate and commensurate with surrounding development standards established in other areas of the City of Botany Bay. 14 The DCP is very comprehensive and detailed. It was developed through Planning NSW Urban Design Advisory Service and was adopted after widespread consultation. It is not in dispute that since the adoption of the DCP the Council has consistently required compliance with C98. The DCP makes specific provision for every site within the precinct.

15 The DCP makes provision for lot consolidation and minimum lot sizes within the DCP area. The subject land was the subject of the consolidation requirements shown in figure 17. Each of the nine lots shown in the consolidated lot on the corner of Coward and O'Riordan Streets was the subject of the development application and they have been consolidated in compliance with the DCP.

16 There are 114 Urban Control Standards to which the sites are subject, of which C98 is one. By its specificity, the DCP not only identifies precisely what will be required of a developer who seeks to develop land in the DCP area, it also gives certainty to any developer as to what can be expected to be developed on other sites within the DCP area. 17 The DCP provisions include the following: (a) Consolidation requirements for every site in the seven sub precincts. The subject site is in sub precinct 1. In sub precinct 1, three of the five consolidated sites, including the subject site, have three frontages. All five of the consolidated sites have frontages to O'Riordan Street on which there are above ground service cables. There are also consolidated sites with three frontages in sub precinct 6 (figure 22). All consolidated sites within the Mascot Station Precinct have at least two frontages. (b) There is provision for a linear park which is to adjoin the subject site on its western boundary. This is one of the advantages of the subject site. (c) The floor space ratio controls are shown in figure 24. The subject site has a maximum FSR of 2.5:1. The height controls are shown in figure 25. The subject site is subject to a height control of seven storeys. Other specific controls are provided for all sites concerning site coverage; apartment sizes and mix building separation; landscaping, open space requirements and set backs; road widening dedications; and public open space dedication. (d) There are specific urban design controls with requirements for the treatment of corner sites such as the subject site. 18 One matter addressed in the DCP is how to deal with the provision of services, in particular above ground cables. Formerly, as an industrial area, there had been little aesthetic concern about above ground cables. Now, however, there is an Urban Facilities Plan in the DCP. Under the Guidelines for the Road Network the following appears: I. Undergrounding of Overhead Wires · All aboveground power lines and other similar services, telephone cables etc are required to be located below ground. 19 The related development controls state: 6.9.1 Provision of Services

Objectives To ensure developments make adequate provision for services and achieve a high quality street presentation in keeping with the vision and likely quality of development within the Mascot Station Precinct.

Rationale It is important that applicants fully understand the issue of services when undertaking the initial planning of their developments. Overhead cabling has the potential to detract from the high quality appearance of new developments within the precinct, accordingly, all service cables are required to be located underground both within and adjacent each development site. 20 The development controls for all sub precincts are then set out. The first is C98, which has been quoted at [4] above. 21 Since any overhead cabling will be placed underground by developers, no provision for this is made in the section 94 contributions plan. The council accepts it has the obligation to place underground overhead cables from street corner to street corner. The DCP explains the aim of the s 94 plan: The aim of the S.94 plan is to ensure that the precinct is a functional and self-supporting entity that does not burden the ratepayers outside the precinct, in the provision of necessary services and facilities that will be generated by proposed new development within the precinct. 22 Due to the detail in the DCP, a developer can make investment decisions knowing what is required of it under the DCP. In the present case the developer knew that if it wanted to develop the site it would need to acquire and consolidate each of the nine sites - which it did. It knew the permissible floor space ratio and height limitations together with the design criteria that was expected. It knew of the advantage of the linear park to the rear of the site. It knew of the requirement to place underground the overhead cables in O'Riordan and John Streets and that all other developers would have the same obligation to place underground any overhead service cables in front of their sites so that the Mascot Station Precinct would ultimately be free of overhead cables. The Development Application 23 In the knowledge of what was required by the DCP, a development application was made by a third party on 14 May 2003. The land owners were other third parties. The development application was for: Demolition of existing buildings and construct a seven storey residential building comprising of 95 residential units (12 x studios, 12 x 1 bed, 69 x 2 beds, 2 x 3 bed), one commercial/retail space to O'Riordan Street and parking for 192 vehicles in three basement levels. 24 The development application was accompanied by a Statement of Environmental Effects (SEE), prepared by a reputable firm. This document contained the following statements which evidenced an intention to comply with the DCP, including C98: The development satisfies all the relevant objectives and controls of Mascot Station Precinct DCP concerning Urban Strategy, Urban Form Controls, Urban Design, Car Parking, Ecological Sustainability and Accessibility.

The proposed development conforms with the urban design and amenity objectives and controls of Mascot Station Precinct DCP. It initiates the process of transformation of the Precinct from industrial to mixed uses and will significantly enhance the image, streetscape and amenity of the Precinct.

The proposal satisfies the urban form, design, scale and architectural objectives and controls of Mascot Station Precinct DCP. 25 The council officer's report assessing the development application (Exhibit 2) recommended approval on the basis that there would be compliance with C98. He stated: The applicant has advised in the submitted Statement of Environmental Effects that the undergrounding of the cables will be carried out as part of the development. This will also be conditioned as part of the development consent. 26 The condition to which he referred became condition 38. 27 The application to the council to modify the consent by (inter alia) deleting condition 38 was dated 3 October 2006. By this time the development was well under construction. The modification application identified the applicant and the owner of the land as George Andrews, the applicant in these proceedings. The original applicant and land owners appear no longer to be involved. A solicitor's letter in support of the modification application invoked the Newbury tests of validity. 28 There is no evidence to suggest that in acquiring the site the applicant was unaware of the conditions of the development consent or unaware of the obligation to comply with C98 of the DCP or condition 38. There is nothing to suggest that the price paid for the land did not reflect the cost of fulfilling the obligations under the development consent including C98. The applicant did not give evidence. The transcript indicates that the Commissioner accepted that the developer, in making decisions to construct the building, would have budgeted on the cost of complying with condition 38. The Proceedings before the Commissioner 29 The Commissioner found that in the original development application the applicant intended to provide for the undergrounding of overhead service cables: judgment [11]. The evidence before the Commissioner indicated that the undergrounding of overhead service cables in accordance with the DCP has been consistently required by the council in conditions of development consent in the Mascot Station Precinct; and that the cost of placing the overhead service cables underground under the council's proposed condition 38 would be about $573,000: judgment [23], [24]. 30 The Commissioner relevantly expressed his conclusions as follows: 35 In my opinion the imposition of the respondent's alternative condition reflecting the requirement in the DCP that: at the full cost of the developer, all service cables in the street adjacent to … the … development site … would, in the circumstances of this development consent, be unreasonable. In applying the three Newbury tests to this condition I agree with Mr Fletcher [a planning expert who gave evidence] that at least one of the tests is not met. 36 Plainly the undergrounding of service cables is for a planning purpose that purpose being described in the DCP as including high-quality urban design. Despite this, one might question whether the identification of whoever should pay for the work as distinct from the actual undergrounding of the cables is of itself, a planning purpose. 37 The second of the Newbury tests is whether the respondent's alternative condition, in the circumstances of this modification application, reasonably and fairly relates to the development under consideration. In my opinion the requirement for the developer to be wholly responsible for all of the undergrounding of service cables in the streets adjacent to the site would be neither fair nor reasonable. I have reached this conclusion taking into account the agreement between the experts that the public is the primary beneficiary of underground cabling. I also understand that the electricity and telecommunications cables in O'Riordan Street are not directly utilised by the development. In addition the properties immediately opposite the site would obtain, at no cost, the aesthetic benefit of not looking out onto overhead cables. 38 Whilst the site itself will obtain a significant aesthetic benefit, and notwithstanding that it benefits from the undergrounding of cables that has occurred elsewhere, this is but a proportion of the combined benefits available to the community at large and the properties opposite. In the circumstances I cannot accept that the burden of carrying the entire responsibility associated with this site's frontages fairly and reasonably relates to the benefit that it receives, especially by comparison with the benefit received by the community at large, including that part of the community that will come to and pass through the Mascot Station Precinct. 39 I thus conclude that the burden associated with the responsibility of undergrounding all of the overhead cables would be disproportionate to the benefit that would accrue to the site and hence the condition does not reasonably and fairly relate to the development under consideration. 40 For similar reasons to those I have applied to the second Newbury test I accept that, in relation to the third test, that a condition to this effect would not be reasonable. Hence, on the basis of the Newbury tests I would not impose the respondent's alternative condition because, despite the requirement of the DCP and the weight that it attracts, the burden of requiring the applicant to carry out the all of the works at its expense would be unreasonable. 41 The evidence provided in these proceedings does not enable me to determine, on the basis of benefits accruing to the site, what would be a reasonable proportion of the costs of undergrounding the overhead cables that should be borne by the applicant. However taking into account the likely benefits accruing to the development by comparison with the benefits to the community at large and to the properties opposite it seems to me that in these circumstances, the applicant's proposed alternative condition would be reasonable and can be imposed as an amendment to the consent. … 45 Also, in relation to the merits consideration of the application I was referred to the discretionary consideration that the acceptance of the benefits of a development consent can weigh heavily against a modification application that seeks to remove the burden of a particular condition. (See Arkibuilt ). Whilst there is little doubt that the applicant originally intended to [sic] underground existing overhead cables, in my opinion the burden of the applicant's alternative condition, considered in its entirety and accepting the differences, is not so different to that of the original condition as to warrant the rejection of the application. 46 Finally, I do not accept the respondent's concern that the upholding of this appeal would set an inappropriate precedent that might affect the integrity of the DCP because of the particular circumstances of this case. Any challenge to a condition of consent that relies on the provisions of the DCP would need to be assessed on its own merits.

There is obviously a word missing at [45] of the judgment (before "underground"). The missing word is probably "place". Grounds of Appeal 31 The council's grounds of appeal from the Commissioner's decision are as follows: 1. The Commissioner erred in failing to give proper, genuine and realistic consideration to the provisions of Mascot Station Precinct Development Control Plan ("the DCP") as required by s 79C(1)(a)(iii) of the Environmental Planning & Assessment Act . 2. The Commissioner erred in that he misdirected himself as to the question he had to determine in applying the tests laid down in Newbury District Council v Secretary of State for the Environment (1981) AC 578 to a merits appeal. 3. The Commissioner erred in finding that condition 38 breached what he referred to as the second and third Newbury tests. 4. The Commissioner erred in finding there was evidence of something revealed which was not known at the time of the granting of the approval when there was no such evidence. 5. The Commissioner erred in failing to give proper, genuine and realistic consideration under s 79C(1)(e) to a matter of public interest raised by the respondent, namely that it is not in the public interest for the applicant to be relieved of the obligation to comply with C98 of the DCP in light of the assurance given by the applicant for development consent to the respondent that if development consent was granted the development would comply with C98 and upon which assurance the applicant relied in granting development consent and in circumstances in which the development consent has been taken up and implemented on the basis that the development would so comply. 32 There is a further ground of appeal which the council sought leave to add at the hearing which I address at [52] below. Appeal Grounds 2 and 3: Submissions 33 The council submitted that the Commissioner misdirected himself as to the application of the second and third Newbury tests and erroneously held that condition 38 was in breach of those tests. 34 The applicant submitted that the Commissioner was correct in holding that condition 38 did not satisfy the second Newbury test and that the Commissioner decided the matter on the merits. 35 It was common ground before me that neither party asked the Commissioner to decide the validity of the council's proposed condition 38. The transcript records the council (but not the applicant) encouraging the Commissioner to consider the Newbury validity tests on several occasions during the hearing but ultimately putting to the Commissioner that they were irrelevant because there was no challenge to validity. The council explained to me that this was because it had understood that the applicant was challenging validity before the Commissioner and did not know that was not so until after the hearing commenced. In any event, the Commissioner addressed the Newbury tests. Appeal Grounds 2 and 3: Discussion 36 At the hearing before me, it became common ground that the Commissioner's decision that condition 38 failed to satisfy the third Newbury test could not be sustained.

37 The third Newbury test is that a condition must be so unreasonable that no reasonable planning authority could have imposed it. This is also euphemistically called the Wednesbury test of unreasonableness, after the seminal case. Its stringency has often been noted by the courts and only occasionally do cases succeed on this ground. It is a test going to the validity of a condition and must not be confused with the ordinary concept of reasonableness that may arise in a merit review. The authorities on Wednesbury unreasonableness were reviewed in this Court in MCC Energy Pty Ltd v Wyong Shire Council (2006) 149 LGERA 59 at [48] by Jagot J and in my judgments in Save Our Street Inc v Settree (2006) 149 LGERA 30 at [27] - [31] and Anderson v Minister for Infrastructure Planning and Natural Resources (2006) 151 LGERA 229 at [71].

38 The Commissioner's decision is contrary to authority. In Optus Networks Pty Ltd v Rockdale City Council [2005] FCA 200, conditions of a council development consent under the Environmental Planning and Assessment Act 1979 in relation to each of two Meriton development sites required the undergrounding of power and television lines in two streets. An attack on the validity of the conditions by reference to the Newbury tests was rejected. Tamberlin J held at [37]: On its face, the undergrounding of cable and power lines as a condition of development consent, where those lines adjoin the subject development, is a requirement reasonably capable of being considered as a reasonable condition by reason of the visual impact of the cable and power lines.

39 The Commissioner dealt with the third Newbury test in one sentence. He stated that his reasons were similar to those he applied to the second Newbury test: at [40]. He considered that as the public and the properties opposite would share the aesthetic benefit, the third Newbury test was not satisfied because it would not be "reasonable" to impose the whole cost burden on the applicant: judgment [37] to [40].

40 In my opinion, that is clearly insufficient to satisfy the third Newbury test and the parties were right to agree before me that the Commissioner's decision in that regard could not be upheld. It is unnecessary to go further but the Commissioner's use of the word "reasonable" suggests that he may have lost sight of the stringency of the third Newbury test which is not concerned with mere reasonableness but with whether a condition is so unreasonable that no reasonable consent authority could have imposed it. It may be that in an extreme hypothetical case the financial burden of a condition could be so utterly gross relative to the benefit that no reasonable planning authority could impose it. That is not this case.

41 I turn to the second Newbury test. It became common ground before me that if the Commissioner erred in his decision that council's proposed condition 38 failed to satisfy the second Newbury test, then the appeal should be allowed and the matter remitted for re-hearing.

42 The second Newbury test requires a condition to "fairly and reasonably relate" to the permitted development. In Western Australian Planning Commission v Temwood Holdings Pty Ltd (2004) 221 CLR 30 at [117] Gummow and Hayne JJ quoted the following passage from the joint judgment in Lloyd v Robinson (1962) 107 CLR 142 at 153 which casts some light on the meaning of this requirement (although Newbury was not cited): The assumption may be accepted that the statutory power to annex conditions to an approval of a subdivision does not extend to requiring the setting aside for public recreation of land which is so unrelated to the land to be subdivided, because of remoteness from it or some other circumstance, that there is no real connexion between the provision of the open space and the contemplated development of the area to be subdivided. But in the present case it must not be forgotten that the subdivision for which the respondents sought approval was one of a series by means of which an area, fairly to be considered as a whole, was being gradually carved up and placed on the market; and it was well within the limits of a proper understanding of the Board's functions under the [Town Planning Act] to insist, at appropriate stages in the course of applications for approval to the constituent subdivisions, that open spaces be suitably located within the total area to satisfy reasonable requirements in respect of the total area.

43 In Dogild Pty Ltd v Warringah Council [2008] NSWLEC 53 at [51] - [52] I explored the meaning of the second Newbury test: What is meant by "fairly and reasonably relate"? The authoritative answer in Temwood at [155] by Callinan J is that it means "it must be a condition, not simply justifiable as one which a reasonable planning authority could impose, but one which is fair and reasonable in the circumstances of the particular case". That seems consistent with dicta in Newbury that there is some overlap between the second and third Newbury tests. Quoting and applying that Temwood passage, Lloyd J held in Charalambous v Ku-ring-gai Council (2007) 155 LGERA 352 at [29] that satisfaction of the Newbury tests depends upon the circumstances of the particular case…

In Parramatta City Council v Peterson (1987) 61 LGRA 286 Stein J held that "fairly and reasonably relate" means that the development is "benefited" by the public amenity provided. He said at 296 "In my opinion the second test of whether the condition fairly and reasonably relates to the permitted development is not answered simply by geographical proximity but rather whether the development is benefited by the public amenity provided. There is no doubt that it must benefit, (as indeed will the Parramatta CBD as a whole), even though the benefit may not be a direct one (in terms of geographical proximity)". A narrower and more rigid test of an "identifiable nexus" and a "direct connection" was rejected: at 295. Peterson , a s 94 condition case, was approved in the context of a non-s 94 condition in this Court in McGregor v Bathurst City Council [1995] NSWLEC 71 by Pearlman J who said: "The second of the Newbury tests was considered by Stein J in Parramatta v Peterson at 296-7 in which his Honour stated the Court's approach to this test should be a broad rather than a narrow approach and that the test is whether the permitted development is benefited by the condition imposed". Peterson was also approved by the Court of Appeal in the s 94 condition case of Lake Macquarie City Council v Hammersmith Management Pty Ltd at 238 [51] where Tobias JA (with whom Mason P and Young CJ in Eq agreed) said in relation to Stein J's judgment: "His Honour found that…the condition requiring a monetary contribution towards its construction satisfied the second Newbury test as the development would be benefited by its provision. This was clear…" Although this line of authority indicates that such a benefit is sufficient to satisfy the second Newbury test, it may not be inconsistent to envisage cases where a condition is fair and reasonable in the circumstances of a particular case (to use Callinan J's description) even if it does not benefit the permitted development.

44 Optus, cited above at [38], is authority that the Commissioner erred in relation to the second Newbury test. Analogous authority against the Commissioner's decision is found in Fairfield City Council v N & S Olivieri P/L [2003] NSWCA 41. In that case the Court of Appeal upheld the validity of a condition of development consent that required the construction of curb and gutter, footpath formation and a carriageway including drainage works for the full public frontage of development over a distance of 110 metres: at [61] - [71]. This was notwithstanding that the carriageway was an extension of a public road which benefited the motoring public. The applicant sought to distinguish Olivieri on the ground that the development there generated the need for the works the subject of the condition, whereas in the present case the Commissioner said that he understood the electricity and telecommunications in O'Riordan Street are not directly utilised by the development: judgment at [37]. Insofar as the condition in Olivieri required a lengthy extension of a public road, I do not think that the submission is correct. In any case, I do not consider that it makes any difference in the circumstances of this case where the development benefits from the undergrounding. In the Optus case the validity of a virtually identical condition was upheld without any suggestion that anything turned on whether or not the development was connected to the cables that were to be placed underground. I note that below I allow an appeal against the said statement of understanding by the Commissioner and that it would require re-determination, if pressed, on any remitter. However, ultimately it may be of no significance to the outcome of the case.

45 In my opinion, the requirements of condition 38 for undergrounding overhead cables in O'Riordan Street at this location were not so unrelated to the development, because of remoteness from it or some other circumstance, that there was no real connection between such undergrounding and the development. Further, the development was benefited by such undergrounding at least for the reason found by the Commissioner, viz, that the development site itself will obtain a significant aesthetic benefit: judgment at [38]. That is sufficient to establish that the requirement of condition 38 as proposed by the council reasonably and fairly relates to the development. It may also be said that the development is benefited in a wider reciprocal sense by the consistent application of C98 of the DCP throughout the Mascot Station Precinct.

46 The appeal must therefore be allowed on the grounds that the Commissioner misapplied the Newbury tests and erred in finding that the council's proposed condition 38 did not satisfy the second and third Newbury tests.

Appeal Ground 1 47 That brings me to the ground of appeal that (as a consequence of the Commissioner's errors in relation to the Newbury tests) he did not give proper, genuine and realistic consideration to the provisions of the DCP. Instead, it is said, he substituted his own standard for the C98 standard.

48 The DCP is a mandatory relevant consideration by force of s 79C(1)(a)(iii) of the Environmental Planning and Assessment Act 1979. In Zhang v Canterbury City Council (2001) 51 NSWLR 589 at 601 Spigelman CJ (Meagher and Beazley JJA agreeing), after referring at [62] to the formulation that "proper, genuine and realistic consideration" was required, said at [64] that "mere advertence to a matter required to be taken into consideration is not sufficient". His Honour held at [75] to [77]: The consent authority has a wide ranging discretion - one of the matters required to be taken into account is the "public interest" - but the discretion is not at large and is not unfettered. DCP 23 had to be considered as a "fundamental element" in or a "focal point" of the decision making process. A provision so directly pertinent to the application for consent before the Council as was cl 4.0 of DCP 23 was entitled to significant weight in the decision making process but was not, of course, determinative.

In my opinion, the Commissioner did not "take into consideration" the standard contained in cl 4.0 of DCP 23. Rather, he substituted for the statutory requirement a different approach. The Commissioner posed the "issue" for his determination to be: "The appropriateness of the location taking into account the proximity to the adjoining church, local schools and hotel". He resolved this issue on the basis that adverse impact upon land affected by the presence of a brothel had to be demonstrated in the legal proceedings before him. This approach could only be supported if the discretion was entirely at large, that is, that there were no "standards" of any character which the decision maker had to take into account. By adopting this approach, the Commissioner, in my opinion, proceeded on an impermissible basis.

There was a relevant and applicable "standard" which he was obliged to "take into consideration". It ought to have served as a focal point for, or constituted a fundamental element in, his deliberations. The evidence, or rather the absence thereof, about actual effects, was not entitled to determinative weight, without regard to the presumptive "standard" in this way.

49 The principles relevant to consideration of development control plans were summarised in Stockland Development Pty Ltd v Manly Council (2004) 136 LGERA 254 at 272 [87] by McClellan CJ as follows: · A development control plan is a detailed planning document which reflects a council's expectation for parts of its area, which may be a large area or confined to an individual site. The provisions of a development control plan must be consistent with the provisions of any relevant local environmental plan. However, a development control plan may operate to confine the intensity of development otherwise permitted by a local environmental plan. · A development control plan adopted after consultation with interested persons, including the affected community, will be given significantly more weight than one adopted with little or no community consultation. · A development control plan which has been consistently applied by a council will be given significantly greater weight than one which has only been selectively applied. · A development control plan which can be demonstrated, either inherently or perhaps by the passing of time, to bring about an inappropriate planning solution, especially an outcome which conflicts with other policy outcomes adopted at a State, regional or local level, will be given less weight than a development control plan which provides a sensible planning outcome consistent with other policies. · Consistency of decision-making must be a fundamental objective of those who make administrative decisions. That objective is assisted by the adoption of development control plans and the making of decisions in individual cases which are consistent with them. If this is done, those with an interest in the site under consideration or who may be affected by any development of it have an opportunity to make decisions in relation to their own property which is informed by an appreciation of the likely future development of nearby property.

50 His Honour also held at [95] that even council urban design controls which may not have been embodied in a development control plan require cogent reasons before the Court should depart from them if they have been carefully thought out after detailed consultation with relevant parties: Where, as in the present case, urban design controls which may not have been embodied in a development control plan have, nevertheless, been carefully thought out after detailed consultation with relevant parties, a council should make decisions which give them practical application. Unless cogent reasons suggest otherwise, a council is also entitled to expect the Court to require development to conform to the adopted parameters. The evidence of the expert witnesses called by the applicant failed to acknowledge the significance of the Urban Design Controls and the role of detailed policy in providing for the orderly development of land which is, of course, one of the fundamental objectives of the planning legislation. Content to argue that the quality of the design of the buildings justified departure from the Urban Design Controls, they failed to appreciate the proper role of urban design controls in the planning process.

51 In the present case, the detailed and carefully thought out DCP was adopted after consultation with interested persons. It has been consistently applied by the council. It has not been demonstrated (nor has it been suggested) that it brings about an inappropriate planning solution. Consistency of decision-making is a fundamental objective. In my opinion, there are no cogent reasons apparent from the judgment for not requiring the development to conform to development control C98. It is not a cogent reason that the passing public or properties across the road share the aesthetic benefit. Insofar as that was the view of the Commissioner, he substituted his own standard for the C98 standard. In my opinion, for these reasons, the Commissioner did not give proper, genuine and realistic consideration to the DCP in the relevant sense. This ground of appeal is upheld.

Proposed Additional Appeal Ground 6 52 At the hearing the applicant applied for leave to amend to add the following additional ground of appeal: 6. The Commissioner erred in making the statement/finding in the penultimate sentence of paragraph 37 of the Commissioner's judgment taking into account the Commissioner's statement made at the hearing (at page 97 lines 44-45 of the transcript for 11 October 2007) that the Commissioner would not give that matter any weight. 53 The Commissioner relevantly stated at [37] of his judgment: "I also understand that the electricity and telecommunications in O'Riordan Street are not directly utilised by the development". The council submitted that this was an appellable error on the ground of procedural unfairness because, just before the end of the hearing, the applicant's legal representative said "O'Riordan Street provides no services to the site", in relation to which the following exchange occurred between the Commissioner and counsel for the council: HALE: Mr Commissioner, there is no evidence to support that second proposition. If it's going to be contended -

COMMISSIONER: Mr Hale you don't get another shot at -

HALE: We can deal with and show factually there is no basis for the submission before last. It was never put to anybody. He looks at a photograph and tries to ask you to interpret it in a particular fashion.

COMMISSIONER: The fact that the power lines in O'Riordan Street don't directly connect to the site.

HALE: It's just wrong and we need to demonstrate that it is wrong because it was never put.

COMMISSIONER: I have some doubts about that too. It won't get any weight. 54 The council submitted that as the Commissioner said he would not give the matter any weight, it was not then open to him to make the finding that he did at [37] of his judgment without at least giving the council the opportunity to address him further on it. Thus, the argument is one of procedural unfairness. The applicant submitted that the Commissioner said that he would give no weight to the proposition that existing services only come in from John Street whereas the sentence in his judgment at [37] was referable to the proposed development. The applicant submitted that the drawing referred to in condition 38(b)(i) shows services being brought to the development from John Street rather than O'Riordan Street and therefore it was open to the Commissioner to make the finding of fact at [37] of his judgment. In reply, the council disputed that the drawing shows this and submitted that nothing was put by the applicant to the Commissioner along those lines nor was any evidence led to that effect.

55 There is no relevant reference to the said drawing in the judgment; the Commissioner did not explain the basis of his understanding expressed at [37] of the judgment; and it is unclear that the applicant's suggested distinction was in the minds of the council and the Commissioner in the discussion quoted above. I am not satisfied that I should accept the applicant's submission. I propose to allow this amendment to the grounds of appeal and to allow the appeal on this ground. It will be a matter for a Commissioner at the remitted hearing to then determine this issue of fact, if it is still pressed, after hearing the parties. It may well be that resolution of this issue is ultimately of no significance. Appeal Grounds 4 and 5 56 It is unnecessary to consider appeal grounds 4 and 5. The Form of the Remitter 57 The council submitted that I should remit the matter to another Commissioner for determination because the strength of the views expressed by the Commissioner gives rise to a reasonable apprehension that he will not decide the remitter impartially. The applicant opposed that course. Section 56A(2) of the Land and Environment Court Act 1979 provides: (2) On the hearing of an appeal under subsection (1), the Court shall: (a) remit the matter to the Commissioner or Commissioners for determination by the Commissioner or Commissioners in accordance with the decision of the Court, or (b) make such other order in relation to the appeal as seems fit. 58 The issue of disqualification of a Commissioner from hearing a remitter following a successful s 56A appeal on the ground of apprehended bias was considered in Castle Constructions Pty Ltd v North Sydney Council (2007) 155 LGERA 52. The Court of Appeal ordered that the proceedings be remitted to a Commissioner other than the Commissioner who had heard the matter at first instance. Tobias JA (Bell J agreeing) noted that the judge on the s 56A appeal had found that the Commissioner expressed "his dislike of the proposal in trenchant and powerful terms and appears to have given his individuated preferences priority over the provisions and intent of the planning scheme": at [65]. His Honour considered that the nature and expression of the Commissioner's findings were such as to clearly give rise to a reasonable apprehension that he may not decide the case on remitter impartially in the relevant sense: at [85].

59 In the present case the council mounted its disqualification application on the basis that the Commissioner did not merely decide that the council condition was invalid but expressed his views on the merits in a very strong way. I would describe the Commissioner's expression of his views as routinely firm rather than strong or trenchant. The Commissioner thought that the council's proposed condition failed the Newbury tests because it was unreasonable that the developer should have to bear the whole responsibility and cost of undergrounding cables in the location when the passing public and the properties across the road also shared the aesthetic benefit. This view defeated C98 of the DCP. I have held that, under the Stockland principle, it was not a cogent reason to depart from C98 by rejecting the council's proposed conforming condition and accepting the applicant's non-conforming condition.

60 I decline to disqualify the Commissioner from hearing the remitter. In my view, the nature and expression of the Commissioner's findings were not such as to clearly give rise to a reasonable apprehension that he may not decide the case on remitter impartially in the relevant sense. Errors of law were the basis on which he rejected the council's proposed condition and accepted the applicant's condition and those errors cannot now be repeated. The duty of the Commissioner, if the matter is remitted to him, is to determine the remitter in accordance with this decision. The appropriate order is that the proceedings be remitted to a Commissioner for re-determination. That leaves it to the Chief Judge, when listing the remitter pursuant to his powers under the Land and Environment Court Act 1979, to allocate the case to a particular Commissioner. CONCLUSION 61 For the foregoing reasons, the orders of the Court will be as follows:

(1) Appeal allowed. (2) The proceedings are to be remitted to a Commissioner for determination in accordance with my decision. (3) The applicant is to pay the council's costs of the appeal.

25/07/2008 - punctuation correction - replace semicolon with fullstop after the word above. - Paragraph(s) 55

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