Belmore Residents' Action Group Incorporated v Canterbury City Council and The Greek Orthodox Parish and Community of Belmore and District All Saints Limited

KEY ISSUES: Judicial Review :- failure to consider draft SEPP - whether s 25B available

LEGISLATION CITED: Environmental Planning and Assessment Act 1979 Land and Environment Court Act 1979

Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1 KB 223 ; Centro Properties Pty Ltd V Warringah Council (No.2) (2003) 132 LGERA 45; Centro Properties Pty Ltd v Hurstville City Council & Anor [2006] NSWLEC 78; Glowpace Pty Ltd v South Sydney City Council (2000) 111 LGERA 84; CASES CITED: GPT Re Limited v Wollongong City Council (No.2) [2006] NSWLEC 401; Kindimindi Investments Pty Ltd v Lance Cove Council (2006) 143 LGERA 277 ; Noble & Anor v Cowra Shire Council (2001) 114 LGERA 440 ; Terrace Tower Holdings Pty Ltd v Sutherland Shire Council (2003) 129 LGERA 195 ; Woolworths Limited v Wyong Shire Council [2005] NSWLEC 607

APPLICANT Mr A M Pickles (barrister) SOLICITORS Avendra Singh Strati Kam

FIRST RESPONDENT LEGAL REPRESENTATIVES: Mr I J Hemmings (barrister) SOLICITORS Abbott Tout

SECOND RESPONDENT submitting SOLICITORS Deacons

JUDGMENT: THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES

40461 of 2006 Belmore Residents' Action Group Incorporated v Canterbury City Council and The Greek Orthodox Parish and Community of Belmore and District All Saints Limited.

JUDGMENT 1 Talbot J: On 2 February 2006 Canterbury City Council determined to grant development consent to a development application lodged by the second respondent with respect to a proposal for demolition of existing structures, alterations and additions to an existing heritage item and the use thereof as a preschool and construction of a kindergarten and primary school at the property 26A-32 Etela Street, 13-17 Cecilia Street and 35 Isabel Street, Belmore. 2 The applicant alleges that the consent is invalid for failure to take into account Draft State Environmental Planning Policy (Application of Development Standards) 2004 ("the Draft SEPP"). The applicant also alleges that the council's determination of an objection made pursuant to State Environmental Planning Policy No. 1 - Development Standards ("SEPP 1") was unreasonable in accordance with the principles in Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1 KB 223 ("Wednesbury"). 3 Under Canterbury Local Environmental Plan No. 178 ("LEP"), the floor space ratio for development on the subject land is restricted to 0.5:1.0. The proposed development has a floor space ratio of 1.03:1.0. 4 Section 79C(1)(a)(ii) of the Environmental Planning and Assessment Act 1979 ("EP&A Act") requires the consent authority to take into consideration any draft environmental planning instrument that is relevant to the development the subject of the development application as follows:- 79C Evaluation (1) Matters for consideration - general In determining a development application, a consent authority is to take into consideration such of the following matters as are of relevance to the development the subject of the development application: (a) the provisions of: … (ii) any draft environmental planning instrument that is or has been placed on public exhibition and details of which have been notified to the consent authority (unless the Director-General has notified the consent authority that the making of the draft instrument has been deferred indefinitely or has not been approved), and … 5 The Draft SEPP (Development Standards) was placed on public exhibition in May 2004. It contains a savings and transitional provision in cl 14(2) as follows: 14 Savings and transitional Provisions … (2) A development application: (a) made under clause 6 of the former Policy before the date of commencement of this Policy and that was not finally determined before that date, or (b) made within 28 days after the date of commencement of this Policy and that could have been made under clause 6 of the former Policy if that Policy had not been repealed by this Policy, Is to be determined in accordance with the former Policy as if the former Policy had not been repealed by this Policy

6 It is conceded by the council that it did not take into consideration the Draft SEPP when determining to grant development consent. As a consequence the applicant says that the decision-making process failed to meet the requirements of s 79C of the EP&A Act and the decision to grant the consent is invalid (Centro Properties Pty Ltd v Hurstville City Council & Anor [2006] NSWLEC 78 ("Centro")). 7 Mr Hemmings, who appears for the council, submits that the decision in Centro Properties is inconsistent with the decision of the Court of Appeal in Terrace Tower Holdings Pty Ltd v Sutherland Shire Council (2003) 129 LGERA 195 and should not be followed. The provisions in the LEP under consideration by the Court of Appeal in Terrace Tower Holdings were different and Mr Pickles, who appears for the applicant, insists that irrespective of cl 14(2) the Draft SEPP (Development Standards) remained a draft environmental planning instrument for the purposes of s 79C. Therefore the council was required to take it into consideration as relevant to the development the subject of the development consent. 8 If the Court finds the consent is invalid the first respondent claims that the Court should make an order pursuant to s 25B of the Land and Environment Court Act 1979 ("the Court Act") suspending the operation of the consent and specifying the terms compliance with which will validate the consent. 9 At the commencement of argument Mr Pickles expressly abandoned the claim of Wednesbury unreasonableness The effect of the decision in Terrace Tower Holdings 10 Mason P delivered judgment for the Court of Appeal with the agreement of Ipp JA. Spigelman CJ made observations by way of reinforcement of the President's conclusions. 11 One of the grounds of appeal against the decision of Justice Cowdroy in this Court was that His Honour erred in giving the provisions of Sutherland Shire Local Environmental Plan 2000 ("SSLEP 2000") weight as if they were certain and imminent notwithstanding that subclause 6(2) of SSLEP 2000 required that it be regarded as a plan that had been exhibited but had not been made. 12 Clause 6(2) of SSLEP 2000 provided that notwithstanding the repeal of Sutherland Shire Local Environmental Plan 1993 ("SSLEP 1993") it applied to a development application that was made but had not been finally determined before the commencement of SSLEP 2000 as if SSLEP 2000 had been exhibited but had not been made. 13 The content of clause 6(2) is in contrast to the provision in clause 14(2) of Draft SEPP (Development Standards) that requires the development application "to be determined in accordance with the former Policies as if the former Policy had not been repealed by this Policy". 14 Cowdroy J considered the development application pursuant to SSLEP 1993. On appeal it was submitted that he had erred in law in the weight he gave to SSLEP 2000 as one of the matters for consideration in the environmental assessment of the proposed development. 15 Mason P noted at [45] that Cowdroy J had applied a stream of case law in the Land and Environment Court addressing two related situations:

1. transitional provisions similar to cl 6(2);
2. relevant draft environmental planning instruments that have been placed on public exhibition and which are therefore required by s79C(1)(a)(ii) to be taken into account. 16 Mason P found that SSLEP 2000, although actually in force at the time of the hearing before Cowdroy J, remained a draft instrument as far as the proposal was concerned by virtue of the command of the transitional provision in cl 6(2) and that s 79C(1)(a)(ii) nevertheless authorised the consent authority to pay regard to relevant provisions in it is a draft instrument. 17 A further challenge to the decision of Cowdroy J was that he erred in holding that perceived government policy supposedly manifested or evidenced by the release of Draft State Environmental Planning No 66 ("Draft SEPP 66") should be taken into account. He decided that Draft SEPP 66 should be given no weight at all as a draft pursuant to s 79C on the basis that if it had been gazetted it would not have been applicable to the subject development application. Nevertheless he found that fundamental planning principle contained within Draft SEPP 66 were matters, which, in the public interest, could be taken into consideration. 18 After noting that a published Draft SEPP is undoubtedly something which may be taken into account to the extent that it is relevant pursuant to s 79C(1)(a)(ii) Mason P observed that cl 14(d) of Draft SEPP 66 provided that the policy does not apply to "a development application that has been made but not finally determined before the commencement of the Policy". 19 The appellant made a submission that the Draft SEPP could never disclose anything of relevance to the proposal because the development application had been lodged before the Draft Policy became an actuality. The President responded to this submission at [78] as follows: It will be seen that this submission parallels that advanced as to the transitional provision in LEP 2000 . My response to the earlier submission is reiterated. A transitional provision in this form does not force the consent authority to shut its eyes to otherwise relevant provisions of the draft planning instrument. 20 Nevertheless his Honour found that the nub of the reasoning by Cowdroy J was that the information drawn from Draft SEPP 66 was relevant to the appeal because it was pertinent to "the public interest" (cf s 79C(1)(e)). Mason P also found that the information distilled from Draft SEPP 66 was also pertinent to paragraph (b), (c) and (d) of 79C(1). 21 In my view it is clear, with respect, that the effect of the reasoning adopted in Terrace Tower Holdings by the Court of Appeal is that the consent authority may consider those provision of a draft instrument that are pertinent to a development application giving weight to its perception of the likely imminence of the relevant provisions of the exhibited draft instrument coming into force. 22 Clause 6(2) of SSLEP 2000 had the effect of maintaining the provisions of the repealed planning instrument as if the 2000 instrument was a draft instrument referred to in s 79C(1)(a)(ii). SEPP Development Standards is a draft instrument that, subject to relevance, falls within the "command" of s 79C(1)(a)(ii). When the Draft SEPP is made cl 14(2) will mandate the consideration of a development application made before the date of commencement of the Policy in accordance with SEPP 1 notwithstanding its repeal. Clause 14(2) does not in terms preclude the consideration of the provision of the Draft Policy under s 79C(1)(a)(ii). Nor could it as an instrument that has not been made. 23 The purpose of s 79C(1)(a)(ii) is to ensure that consideration is given to the provisions of policies foreshadowed in draft instruments giving due weight to those provisions according to the certainty and imminence of the making of the draft environmental planning instrument. The fact that cl 14(2) provides for the subject development application to be dealt with under SEPP 1 even though the Draft SEPP has been made it is but one of the provisions of the draft that could be relevant to the subject development application. It might be suggested that to give weight to the provisions of the Draft SEPP will be to give the provisions greater relevance than if it had been made. However, that suggestion overlooks the effect of s 79C(1)(a)(i) on the SEPP as made and the "public interest" touching the proposal determined at a time when SEPP (Development Standards) had been made (s79C(1)(e)). Clause 14(2) does not say that SEPP (Development Standards) is to be ignored but only that the development application is to be determined in accordance with the former policy as if that policy had not been repealed. 24 SEPP 1 and Draft SEPP (Development Standards) essentially deal with the same subject matter but the latter adopts a strategic approach to flexible planning in an attempt to improve consistency and transparency and restricts the use of the policy in certain circumstances. An additional onus is placed upon applicants to justify an objection to the application of the development standards. All of these are matters that I consider fall within the ambit of relevance referred to in the chapeau to s 79C. 25 After re-examining the judgment in Terrace Tower Holdings and considering the particular provisions that arise for consideration in this case I see no reason to depart from my earlier determination in Centro Properties Ltd that by failing to take into consideration the provisions of Draft SEPP (Development Standards) the council failed to meet the obligation imposed by s 79C(1)(a)(ii). 26 In light of the Council's concession that it did not give any consideration to the Draft SEPP, its determination to grant development consent is invalid. Whether the provisions of s 25B of the Court Act should be applied. 27 The Council relies upon Part 3 Division 3 of the Court Act to avoid the necessity for invalidating the consent. 28 As Pearlman J observed in Glowpace Pty Ltd v South Sydney City Council (2000) 111 LGERA 84 at [34] "The consequent invalidity of the development consent clearly falls within s 25A(2) because it is an invalidity which arises from a step preliminary to the granting of the development consent". Her Honour examined the various alternatives available either by the application of the sections within Division 3 of Part 3 of the Court Act or s 104C of the EP&A Act. She concluded at [55] that the lack of finality and certainty in a development consent does not result in invalidity as a consequence of a step preliminary to the granting of the development consent in terms of s 25B(2). Moreover Pearlman J found that where there is a fundamental flaw in the development consent, which has the consequence that Council has not finally disposed of the development application and has not granted consent at all, the provisions of the Court Act can have no application. 29 In Noble & Anor v Cowra Shire Council (2001) 114 LGERA 440 at [30] Her Honour again held that s 25A(2) provides the power conferred on the Court by Division 3 of Part 3 only where the invalidity arises from any steps preliminary to the granting of development consent. In that case where the development consent was found to be invalid as a consequence of a failure to take into account a relevant consideration, Her Honour took the view that as a matter of discretion she would not be willing to make an order pursuant to s 25B because she could not safely conclude that if the relevant matter had been taken into consideration the council would have granted development consent. Because the council might conclude that development consent should not be granted she said it would be inappropriate in those circumstances to make orders of the sort contemplated by the section. 30 Glowpace was followed by Justice Pain in Woolworths Limited v Wyong Shire Council [2005] NSWLEC 607 and Centro Properties Pty Ltd V Warringah Council (No.2) (2003) 132 LGERA 45 ("Centro (No. 2)"). In so doing Pain J in Centro (No. 2) found that a consideration under s 79C of the EP&A Act was not a step preliminary to the grant of development consent but rather she regarded it as part of the decision. 31 Biscoe J had occasion to collect and consider the above authorities together with other decisions of this Court regarding the application of s 25B of the Court Act in GPT Re Limited v Wollongong City Council (No.2) [2006] NSWLEC 401, including the decision of Lloyd J in Kindimindi Investments Pty Ltd v Lance Cove Council (2006) 143 LGERA 277 where Lloyd J did not follow the decision of Pearlman J in Glowpace on the basis that the provisions of Part 3 of Division 3 are beneficial and therefore should be construed widely and given a liberal interpretation. Biscoe J found it unnecessary to decide between the competing views as to the scope of the power. 32 Although Lloyd J decided to apply the provisions of s 25B in Kindimindi it is appropriate to appreciate the circumstances under which he made that decision. He determined at [25] that the error of the council amounted to a discrete matter of a technical nature that could be considered in isolation from other matters. It was a simple failure to impose a condition to give effect to the council's intention and accordingly was an appropriate case for the application of s 25B. The circumstances considered by Lloyd J in Kindimindi are clearly distinguishable from the nature of the invalidity under consideration in the other authorities and in particular in the present case. 33 In Centro I also declined to make an order pursuant s 25B of the Court Act as the steps to be undertaken involved the weighing of the provisions of the same Draft SEPP under consideration in this case as part of the total consideration required pursuant to s 79C and generally. Whatever matters are found to be relevant, if any, must be balanced and weighed against all the other matters that are relevant to the Council's consideration. As I said in Centro this step necessitates a reopening of the whole process. It is not, in my view, the intention of s 25B or the other provisions within Part 3 of Division 3 to allow the consent authority to reopen the whole of its consideration. 34 I am not therefore prepared to make an order pursuant to s 25B as requested by the council. The weight of authority in this Court is now such that it is appropriate for me to adopt an approach consistent with the one I adopted in Centro. Moreover given that the development application remains on foot there is little utility in making an order under s 25B.

Formal Orders 35 The formal orders of the Court are as follows:

1. A declaration that the development consent granted by the First Respondent on 2 February 2006 to the Second Respondent in respect of development application No. 947/2005 ("the consent") is void and of no effect.
2. An order restraining the Second Respondent, its servants or agents, from carrying out any development in reliance upon the consent.
3. Costs reserved.

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.