Besmaw Pty Ltd v Secretary of the Department of Planning and Environment

Legislative framework

1. The grounds articulated by the parties must be seen within the purview of the NSW planning scheme. The legislation relevant to these proceedings is the EPA Act, the EPA Regulations, the SRD SEPP and the State Environmental Planning Policy (Kurnell Peninsula) 1989 (NSW) ('Kurnell SEPP').
2. The process of submitting a development application for a SSD and the power of the Minister to grant consent for SSD is set out in the EPA Act. Relevantly, s 89C of the EPA Act provides that SSD is development so declared in a State environmental planning policy. The relevant sections of the EPA Act are: 78A Application (1) A person may, subject to the regulations, apply to a consent authority for consent to carry out development. … (8A) A development application for State significant development is to be accompanied by an environmental impact statement prepared by or on behalf of the applicant in the form prescribed by the regulations. 89C Development that is State significant development (1) For the purposes of this Act, State significant development is development that is declared under this section to be State significant development. (2) A State environmental planning policy may declare any development, or any class or description of development, to be State significant development. … 89D Minister consent authority for State significant development (1) The Minister is the consent authority for State significant development. Note. Section 23 enables the Minister to delegate the consent authority function to the Planning Assessment Commission, the Secretary or to any other public authority. … 89G Regulations - State significant development In addition to any other matters for or with respect to which regulations may be made under this Part, the regulations may make provision for or with respect to the procedures and other matters concerning State significant development, including the following: (a) the environmental impact statements to accompany development applications in respect of State significant development, (b) the requirements for the preparation of those environmental impact statements, including consultation requirements with respect to government agencies and other affected persons, ...
3. Pursuant to s 78A(8A) of the EPA Act, a development application for SSD must be accompanied by an environmental impact statement provided in the form prescribed by the regulations. Schedule 2 of the EPA Regulations sets out the prescribed form for environmental impact statements, and relevantly provides in cl 3 (extracted below) that, before preparing an environmental impact statement, the applicant is to ask the Secretary for SEARs, which the Secretary is generally to provide within 28 days. 3 Environmental assessment requirements (1) Before preparing an environmental impact statement, the responsible person must make a written application to the Secretary for the environmental assessment requirements with respect to the proposed statement. (2) The application is to be in a form approved by the Secretary and must include particulars of the location, nature and scale of the development or activity. (3) The Secretary may require the responsible person to provide further particulars. (4) In preparing the environmental assessment requirements with respect to an application for State significant development, the Secretary must consult relevant public authorities and have regard to the need for the requirements to assess any key issues raised by those public authorities. … (5) The Secretary is to notify the responsible person and (where relevant) the responsible authority in writing within the required time of the environmental assessment requirements. The Secretary may modify those requirements by further notice in writing. … (10) In this clause, required time means: (a) within 28 days after the application is made under subclause (1), or (b) if the Secretary has requested further particulars, within 28 days after those particulars have been provided to the Secretary, or (c) within such further time as is agreed between the Secretary and the applicant.
4. The purpose of SEARs is to allow the Secretary to direct the applicant to specific matters to be addressed in the environmental impact statement, which accompanies the development application and is subject to a public display and consultation process. From a policy perspective, this promotes good decision-making as it allows the decision-maker, in the case of SSD being the Minister or their delegate, to have all the material before them, and to make an informed assessment.
5. Pursuant to s 89C(2) of the EPA Act, a state environmental planning policy may declare any development, or any class or description of development, to be SSD. In the present matter, there is a State environmental planning policy specific to the Kurnell Peninsula, the Kurnell SEPP, however pursuant to cl 7 of the SRD SEPP, the SRD SEPP prevails over the Kurnell SEPP to the extent of any inconsistency.
6. As at the time of the Decision, cl 8 of the SRD SEPP provided as follows: 8 Declaration of State significant development: section 89C (1) Development is declared to be State significant development for the purposes of the Act if: (a) the development on the land concerned is, by the operation of an environmental planning instrument, not permissible without development consent under Part 4 of the Act, and (b) the development is specified in Schedule 1 or 2. (2) If a single proposed development the subject of one development application comprises development that is only partly State significant development declared under subclause (1), the remainder of the development is also declared to be State significant development, except for: (a) so much of the remainder of the development as the Director-General determines is not sufficiently related to the State significant development, and (b) coal seam gas development on or under land within a coal seam gas exclusion zone or land within a buffer zone (within the meaning of clause 9A of State Environmental Planning Policy (Mining, Petroleum Production and Extractive Industries) 2007). …
7. Relevantly, cll 13 and 14 of Sch 1 to the SRD SEPP specify the following developments as SSD: 13 Cultural, recreation and tourist facilities (1) Development that has a capital investment value of more than $30 million for any of the following purposes: (a) film production, the television industry or digital or recorded media, (b) convention centres and exhibition centres, (c) entertainment facilities, (d) information and education facilities, including museums and art galleries, (e) recreation facilities (major), (f) zoos, including animal enclosures, administration and maintenance buildings, and associated facilities. (2) Development for other tourist related purposes (but not including any commercial premises, residential accommodation and serviced apartments whether separate or ancillary to the tourist related component) that: (a) has a capital investment value of more than $100 million, or (b) has a capital investment value of more than $10 million and is located in an environmentally sensitive area of State significance or a sensitive coastal location. 14 Hospitals, medical centres and health research facilities Development that has a capital investment value of more than $30 million for any of the following purposes: (a) hospitals, (b) medical centres, (c) health, medical or related research facilities (which may also be associated with the facilities or research activities of a NSW local health district board, a University or an independent medical research institute).
8. While accepting that the SRD SEPP prevails, Besmaw drew attention to cl 33(3) of the Kurnell SEPP, which provides: 33 Development for certain additional purposes … (3) The Council may grant consent to a development application made by FAPACE PTY LIMITED dated March 1989 relating to Lot 4, DP 712157, Lot 2, DP 559922 and Lot 3, DP 225537 where the Council has taken into consideration the Deed dated 14 March 1989 between Besmaw Pty Limited, Fapace Pty Limited, the Minister administering the Environmental Planning and Assessment Act 1979, the Director of Planning and the Council of the Shire of Sutherland relating to the land.
9. The Deed the subject of this clause related to development earlier proposed by Fapace Pty Limited and provided for (amongst other things) the Minister, when preparing the draft Regional Environmental Plan for the Kurnell Peninsula (what is now the Kurnell SEPP), to include a recommendation that the Regional Environmental Plan permit with consent the carrying out of the development proposed by Fapace Pty Limited.
10. The development the subject of the Deed was to be called the 'Sydney Destination Resort' and was described in the development application as comprising: 1. a major international hotel rising 10 storeys; 2. an international suite style hotel rising 10 storeys associated with internal water features; 3. a series of low-rise condominiums (tourist apartments) located adjacent to the hotels and internal water bodies for tourists and other resort users; 4. an 18-hole golf course; 5. an equestrian centre and horse riding tracks along a specifically designed multi-purpose bicycleway/ horseriding and other trails; 6. a private hospital and separate research institute; 7. a festive market retail concept for day trippers in addition to specialist retailing which will be provided in association with the two hotel complexes; 8. a theatre/ arena/ entertainment complex; 9. restaurants associated with hotels, special use facilities and special vantage points; and 10. a tennis and sporting complex.
11. Although not determinative, Besmaw submits that the Proposed Development is the subject of cl 33 of the Kurnell SEPP, and it was stated in the Briefing Note that the Proposed Development is permitted under the Kurnell SEPP.

Besmaw's submissions

1. Besmaw challenges the Decision on seven grounds.

Ground one: misconstruction of the statutory task required under cl 8(2)(a) of the SRD SEPP

1. Besmaw submits that under cl 8(2) of the SRD SEPP, where a proposed development is made up of parts that clearly fall within the type of development declared to be SSD, the "default" position is that the entire proposed development should be declared SSD. It is, according to Besmaw, only in the exceptional case where the non-SSD parts of a proposed development are found not to be "sufficiently related" to the SSD that the Secretary should differentiate between different components of the proposed development. The policy rationale behind the clause is, Besmaw submits, to ensure that a proposed development is subject to a single set of environmental planning controls and protocols, rather than having different parts of a development regulated by different standards. Besmaw contends that the Secretary considered the question "are the non-SSD parts of the Proposed Development sufficiently related to the SSD parts that they should all be declared to be SSD?", rather than the correct question, which is "starting with the position that the Proposed Development is to be declared SSD in its entirety, are the non-SSD parts not sufficiently related to the SSD parts to allow the default position to apply?"
2. Besmaw relies on Project Blue Sky Inc v Australian Broadcasting Authority (1998) 184 CLR 355; [1998] HCA 28 ('Project Blue Sky') as authority for the meaning of the words "related to" - noting the High Court's observation at [87] that "[t]he words 'relate to' are extremely wide. They require the existence of a connection or association." This, Besmaw submits, is supported by Cardile v LED Builders Pty Ltd (1999) 198 CLR 380; [1999] HCA 18 ('Cardile') at [108].
3. Besmaw submits that the word "sufficiently" requires the Secretary to consider whether there is some reason, from a planning perspective, why particular components of a development should not be assessed as part of an integrated whole with the other components of the development.
4. The term "sufficiently related" does not, on Besmaw's submission, require a quantitative assessment as undertaken by the Secretary of the size of the non-SSD parts of the Proposed Development as against the SSD parts (e.g. noting that the condominiums form just over half of the proposed total gross floor area and 20% of the site coverage). Besmaw submits that the Secretary failed to take into account the qualitative characteristics of the non-SSD components of the Proposed Development that make them inextricably "related to" the SSD components, such as the ongoing legal and management relationship between resort management, owners/occupiers of the condominiums and the hotel operator, as well as the fact that the condominiums will use the services of the hotel.
5. Further, Besmaw submits that the Secretary took into account prohibited considerations by: 1. stating that the condominiums "do not have the characteristics of tourist accommodation" - which Besmaw submits is irrational reasoning given that the condominiums were a recognised non-SSD component of the Proposed Development; and 2. noting that the "[r]esidential, commercial, retail and coastal subdivision projects were intentionally excluded as classes of SSD when [the SRD SEPP was] introduced in 2011". Besmaw submits that there is no indication in cl 8(2) of the SRD SEPP that particular non-SSD activities are inherently incapable of being sufficiently related to SSD activities, that no such presumption can be made from the exclusion of particular activities as being SSD, and that accordingly the Secretary took into account a prohibited consideration.
6. Besmaw also submits that the Secretary's misconstruction of the statutory task is demonstrated by her stating that a reason for finding that the non-SSD parts of the Proposed Development were not sufficiently related to the SSD parts was because an "appropriate pathway" for consent for the Proposed Development is "by review of the existing planning controls in the Kurnell SEPP". Besmaw submits that this demonstrates that the Secretary was in fact seeking to dictate what pathway Besmaw should be allowed to pursue in seeking development consent, and effectively diverting Besmaw from its application for SSD consent, which is not a relevant consideration in the context of cl 8(2)(a) of the SRD SEPP.
7. Additionally, Besmaw contends that the Secretary erred by considering that the relationship between SSD and non-SSD components of the development becomes less sufficient if the non-SSD components are 'ancillary' or 'incidental to' the SSD components. Besmaw submits that the Secretary 'truncated' the consideration required by cl 8(2)(a) by adopting those tests, noting that the SRD SEPP called for an 'ancillary' test in other clauses, and where those tests were required, it was expressly stated.
8. Finally, Besmaw contends that the Secretary placed reliance on factors irrelevant to the statutory task, for example by concluding that the SSD and non-SSD components were not sufficiently related because residential, commercial, retail and coastal subdivision projects were intentionally excluded as classes of SSD.

Ground two: failure to apply the test of "sufficiently related" as had been adopted

1. Besmaw contends that the Secretary can also be seen to have adopted a test in the Reasons that the non-SSD components be "complementary" to the SSD components so as to be "sufficiently related". Besmaw notes that the complementary test is materially distinct from the ancillary or incidental test - which requires one function to be dominant. However, having adopted that test, Besmaw submits that the Secretary was bound to apply it (see e.g. Tanielu v Minister for Immigration and Border Protection (2014) 225 FCR 424; [2014] FCA 1221 at [102], [104])) ('Tanielu'), and failed to do so, as the Briefing Note did not refer to any test of complementarity in relation to the condominiums. This, Besmaw submits, amounts to an error in the Secretary's reasoning.

Ground three: failure to afford Besmaw an opportunity to be heard in respect of the Speakman Letter

1. Besmaw submits that it was owed procedural fairness by the Secretary in making the Decision (see Minister for Immigration and Border Protection v WZARH (2015) 256 CLR 326; [2015] HCA 40 at [30] ('WZARH'), which requires both "the absence of the actuality or the appearance of disqualifying bias" and "the according of an appropriate opportunity to be heard" as per Isbester v Knox City Council (2015) 255 CLR 135; [2015] HCA 20 at [55] ('Isbester').
2. This ground arises in relation to the Speakman Letter, which Besmaw submits was adverse material put before the decision-maker. Relying on Commissioner for Australian Capital Territory Revenue v Alphaone Pty Ltd (1994) 49 FCR 576; [1994] FCA 1074 ('Alphaone') at 591-2, Besmaw submits that it was denied the right to comment on this adverse material.
3. Besmaw submits that the Speakman Letter conveyed a "strident message" in opposition to the Proposed Development, and that the Secretary's consideration of the points raised in the Speakman Letter are evident in the Reasons - particularly in the references to the notion that particular types of non-SSD developments should not be allowed to proceed as part of a SSD proposal, and to "alternative planning pathways". Further, even if the Secretary did not give weight to the contents of the Speakman Letter, Besmaw submits that it nevertheless can amount to a breach of procedural fairness due to the subconscious effect on the Secretary's mind; see Jagroop v Minister for Immigration and Border Protection (2014) 225 FCR 482; [2014] FCAFC 123 ('Jagroop') at [70]. The prejudice potentially caused by the Speakman Letter was exacerbated by the fact that it was sent to the Department from Mr Stokes' office with "high" priority, was expressed as legal argument from a local Member of Parliament with high level legal qualifications, and used prejudicial terms such as describing the non-SSD components of the Proposed Development as "transparent ruses".

Ground four: Secretary acted with apparent bias

1. Relying on the first limb of the procedural fairness test established in Isbester at [55], Besmaw submits that the Speakman Letter gives rise to an apprehension of bias on the part of the Secretary, as a fair-minded observer might reasonably apprehend that the Secretary determined the question of "sufficiently related" other than on its legal and factual merits.
2. As above, Besmaw supports this ground by reference to the language of the Speakman Letter and the circumstances of Besmaw not being given an opportunity to see or respond to the letter. Ultimately, Besmaw submits that the Secretary's consideration of the Speakman Letter affects the "overall integrity of the decision-making process" as per Gageler J in Isbester at [58].

Ground five: error in forming an opinion under cl 8(2)(a), given there was no 'development application' in existence

1. Besmaw submits that the Secretary acted prematurely in finding that the Proposed Development was not SSD, as the decision under cl 8(2)(a) of the SRD SEPP cannot be made until an applicant has submitted a development application. Accordingly, Besmaw submits that the Secretary's purported determination as to SSD in relation to the Proposed Development is invalid and of no effect.
2. This construction, Besmaw submits, is supported by the words of cl 8(2) being, "If a single proposed development the subject of one development application…" (emphasis added), which demonstrate that the clause's operation is conditional upon the existence of a development application.
3. Besmaw further submits that there are clear policy and practical reasons supporting this construction, in that the precise relationship between various aspects of a proposed development are often not known until a development application and accompanying environmental impact statement are finalised - and it is therefore premature to form a decision as to SSD in the absence of this information.

Ground six: on a proper construction of cl 8(2), the Secretary was bound to conclude that the entire Proposed Development was declared to be SSD

1. If the Court does find that the Secretary was entitled to make a determination under cl 8(2)(a) of the SRD SEPP regardless of the absence of a development application, in light of errors in the Secretary's construction of the statutory task under cl 8(2)(a) and the fact that the Secretary took into account irrelevant considerations, Besmaw submits that the Secretary's basis for finding that the Proposed Development was not SSD falls away. Accordingly, given there is no lawful basis for concluding that there was not a sufficient relationship between the SSD and non-SSD parts of the Proposed Development, Besmaw submits that the default position under cl 8(2)(a) of the SRD SEPP applies, and the entire Proposed Development should be declared SSD.

Ground seven: if the Secretary has not made a decision in respect of the SEARs request, she should be ordered to make such a decision

1. Finally, Besmaw submits that if the Court finds that the Secretary has not made a decision in respect of the SEARs request, the Secretary should be ordered to do so. It was noted in oral submissions that this point only arises should the Court not accept Besmaw's earlier arguments in these proceedings, as, if the Court finds against Besmaw in that no decision has been made on the SEARs request, Besmaw submits that the Secretary should be ordered to make such a decision.

Department's submissions

1. The Department denies Besmaw's allegations and responds to each ground separately.

Ground one: alleged misconstruction of cl 8(2)(a) of the SRD SEPP

1. The Department submits that Besmaw's submission ultimately depends on an "inappropriate and unwarranted gloss on the simple language of cl 8(2)(a)". Rather than being prescribed or confined, the Department submits that the words "sufficiently related" simply require an exercise of judgment as to the degree of the connection; see BHP Petroleum (Timor Sea) Pty Ltd v Minister for Resources (1994) 49 FCR 155 at 177.
2. Specifically in relation to Besmaw's submission regarding the 'default position' under cl 8(2)(a), the Department accepts that the clause does establish a default position, however submits that once the Secretary embarks upon a consideration of whether the non-SSD components of a proposed development are "sufficiently related", there is nothing in the text of the clause to establish a presumption in favour of one outcome over another. The Department submits that the 'implicit weighting' alleged by Besmaw and the requirement for 'exceptional circumstances' is in fact at odds with the statutory test of "sufficiently related". Further, the word 'except' in cl 8(2)(a), the Department submits, does not aid Besmaw in this construction.
3. Further, Besmaw's submission as to the desirability of having a development governed by a single set of planning protocols does not, the Department submits, come at any cost. The Department submits that the EPA Act envisages the possibility of multiple consent authorities dealing with different stages of a development (see s 89D(2) of the EPA Act). Importantly, the Department submits that the legislative intention behind cl 8(2)(a) of the SRD SEPP was to ensure that applicants could not circumvent planning controls by employing a single development application to seek consent for impermissible developments. The words "sufficiently related", the Department submits, allow the Secretary to engage in a discretionary, evaluative judgment of each application on its merits.
4. The Department also submits that the wording "related to" does not necessarily signify a broad ambit, but rather must be interpreted according to the context; see R v Khazaal (2012) 246 CLR 601; [2012] HCA 26 at [31]; Western Australia v Ward (2002) 213 CLR 1; [2002] HCA 28 at 274-275. In the context of cl 8(2)(a), the Department submits that the degree of connection is indicated by the word "sufficiently".
5. In relation to Besmaw's submission that the Secretary took into account prohibited considerations, the Department submits that to establish this point, Besmaw is required to demonstrate as a matter of statutory construction that the considerations in question, e.g. the size and scale of the condominiums as against the SSD components of the Proposed Development, were prohibited under the SRD SEPP. The Department submits Besmaw has not established this and that no such restriction exists, but rather the Secretary's discretion is unconfined. Further, the Department submits that the relative scale of the condominiums is a relevant consideration in determining whether they are "sufficiently related" to the SSD components of the Proposed Development, and in any case, this was not the sole or determinative criterion adopted by the Secretary.
6. In response to Besmaw's contention that the Secretary ignored the effect of the Kurnell SEPP and the legal and management relationship between the condominiums and the hotels, the Department submits that this was not (and was not submitted by Besmaw to be) a mandatory consideration, and in any event is misconceived. The Department submits that Besmaw has not established that the SRD SEPP required the Secretary to take this into account, and that further, the fact that the Proposed Development may be permissible under cl 33 of the Kurnell SEPP does not necessarily establish that the non-SSD components are "sufficiently related" for the purposes of cl 8(2)(a) of the SRD SEPP. Further, the Department submits that the Secretary did in fact have regard to these considerations, as demonstrated in the Briefing Note.
7. Besmaw's submission that the Secretary engaged in 'irrational reasoning' by noting that the condominiums did not have the characteristics of tourist accommodation is disputed by the Department. The Department rather submits that Besmaw has not made out this claim and that, in any case, the ground involves a merits critique. The Department submits that grounds based on irrationality have no particular legal consequence (relying on Minister for Immigration and Citizenship v Li (2013) 249 CLR 332; [2013] HCA 18 ('Li') at [30], referring to Minister for Immigration and Multicultural Affairs v Eshetu (1999) 197 CLR 611; [1999] HCA 0021 at [40]), and that the conduct alleged does not meet the standard of unreasonableness in a legal sense (see Li at [72]).
8. In relation to Besmaw's submission that the Secretary misconstrued the statutory test by considering whether the non-SSD components were 'ancillary' to the SSD components, the Department submits that 'ancillary' was not adopted as the sole criterion, but rather was used to describe a possible characteristic relevant to whether the components were "sufficiently related".
9. Finally, in relation to the prohibited considerations alleged by Besmaw, the Department submits: 1. first, in relation to the contention that the Secretary impermissibly had regard to the fact that residential and commercial subdivision projects were intentionally excluded from classes of SSD, the Department submits that the Secretary did not treat this as conclusive of the fact that the non-SSD components were not "sufficiently related", but rather the Secretary merely noted (and was entitled to do so) the legislative history of the SRD SEPP; 2. second, in relation to the contention that the Secretary impermissibly had regard to the fact that amendment to the Kurnell SEPP provided an "alternative appropriate pathway" for the Proposed Development to proceed, again, the Department submits that the Secretary did not note this matter to justify the conclusion that the non-SSD components were not "sufficiently related", but rather was merely noting the practical consequences of the Decision and potential next steps; 3. finally, in oral submissions, the Department cautioned against adopting an overzealous consideration of the Secretary's reasons as noted in Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259; [1996] HCA 6 at 271-272.

Ground two: alleged failure to apply test of complementarity

1. As with Besmaw's submission regarding the Secretary's use of an 'ancillary' test, the Department submits that the Secretary did not adopt a 'complementary' test, but rather used it to describe one of the possible characteristics relevant to determining whether the non-SSD components were "sufficiently related".
2. The Department further submits first, that these proceedings are distinguishable from Tanielu, where the Minister adopted a test that had a fairly settled meaning at law (the test of 'unacceptable risk') and second, that the 'key proposition' upon which Tanielu turned has been rejected in later decisions. The concept of whether functions are 'complementary', the Department submits, does not have established content in Australian law. Therefore, even if the Secretary did adopt such a test, Besmaw has not demonstrated that the Secretary erred in its application.

Ground three: alleged denial of procedural fairness

1. In response to Besmaw's submission that it was denied procedural fairness in relation to the Speakman Letter, the Department submits that no such obligation was owed to Besmaw, as cl 8(2)(a) of the SRD SEPP does not affect any identifiable right or interest of Besmaw (see FAI Insurances Ltd v Winneke (1982) 151 CLR 342; [1982] HCA 26 ('FAI Insurance') at 360; Annetts v McCann (1990) 170 CLR 596; [1990] HCA 57 at 598). Rather, the Department submits, the Decision simply determines the procedures that might be applied to the future assessment of the Proposed Development. For example, the non-SSD components of the Proposed Development might be pursued by seeking consent from Sutherland Shire Council, whilst consent for the SSD components could be sought from the Minister. As such, the Department submits that the Decision does not attract procedural fairness.
2. In any case, the Department submits that the duty of procedural fairness does not necessarily require disclosure of any adverse material, but rather adverse material that is "credible, relevant and significant", see Kioa v West (1985) 159 CLR 550; [1985] HCA 81 at 629. Further, the Department submits that to establish that Besmaw has been denied procedural fairness, Besmaw is required to demonstrate that it has incurred "practical injustice" as per Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam (2003) 214 CLR 1; [2003] HCA 6 ('Ex parte Lam') at [37].
3. The Department submits that there was no denial of procedural fairness or practical injustice as: 1. Besmaw had multiple opportunities both in writing and in meetings to put its case as to why the non-SSD components were sufficiently related to the SSD components of the Proposed Development, which is the relevant issue under cl 8(2)(a) of the SRD SEPP; 2. the bulk of the Speakman Letter went to arguing that the Proposed Development was not permitted under the Kurnell SEPP, however, this was not the relevant issue under cl 8(2) of the SRD SEPP. Further, this was a topic on which Besmaw had the opportunity to be heard and fully put its case, and ultimately was not considered persuasive by the Secretary, as demonstrated in the Briefing Note; 3. to the extent that the contents of the Speakman Letter were relevant to the issue requiring determination under cl 8(2)(a) of the SRD SEPP (i.e. in relation to whether the condominiums are sufficiently related to the tourist accommodation), Besmaw was well aware of these issues. The Department had repeatedly notified Besmaw that the information it had provided did not lead to a conclusion that the non-SSD and SSD components were sufficiently related, and therefore, the Speakman Letter did not raise any new issues relevant to the Decision of which Besmaw was not already aware; 4. Besmaw was aware of Mr Speakman's opposition to the Proposed Development, and in fact conveyed this opposition to the Department when advising the Department of a meeting between itself and Mr Speakman; 5. in the context of Besmaw's knowledge of the substantive issues raised in the Speakman Letter, Besmaw therefore has not lost an opportunity to put any information or argument to the Secretary, or suffered any detriment; and 6. there is no evidence that the Secretary paid substantive attention to the Speakman Letter, and no evidence in the Briefing Note that the letter factored into the Decision.

Ground four: alleged apprehension of bias

1. The Department disputes the submission that simply receiving the Speakman Letter creates an apprehension of bias on the part of the Secretary, particularly given that neither the Secretary nor the Department can control what information is sent to them. The Department relies on the submissions advanced in relation to ground three above to deny this allegation, and further submits that the detail provided in the Briefing Note (e.g. considering the nature and history of the development, citing the relevant statutory test, analysing the relationship between the SSD and non-SSD components) demonstrates that there is no basis for suggesting that the Secretary deviated from making the Decision other than on its merits.

Ground five: absence of a development application

1. The Department submits that Besmaw's submission that there must be a development application before the Secretary can make a determination under cl 8(2)(a) conveys a misunderstanding of the SRD SEPP, the EPA Act and the EPA Regulations.
2. First, the Department notes that this submission is contrary to the basis upon which Besmaw made its request for SEARs, as, in requesting SEARs Besmaw relied on cl 8(2)(a) to have the Proposed Development declared SSD. The Department submits that cl 8 allows for certain developments to be declared SSD without a temporal distinction based on stages of the assessment processes. Further, the Department submits that the Secretary's exercise of discretion under cl 8(2)(a) arose in the context of a SEARs request, which necessarily arises prior to the making of a development application given that a development application for SSD must be accompanied by an environmental impact statement.
3. Importantly the Department submits that cl 3 of Sch 2 to the EPA Regulations requires the Secretary to determine whether a development is SSD prior to issuing SEARs, as cl 3(4) provides: In preparing the environmental assessment requirements with respect to an application for State significant development, the Secretary must consult relevant public authorities and have regard to the need for the requirements to assess any key issues raised by those public authorities. (Emphasis added.)
4. The Department submits that cl 3(9) of Sch 2 similarly envisages the SSD determination to be made before SEARs are issued - noting that the clause provides that the Secretary may at any time waive the requirement for a SEARs request except in relation to integrated development and SSD of certain kinds.
5. Read properly, the Department submits that the term "development application" applies to both a development application already made and a development application proposed to be made.
6. Further, the Department submits that the information contained in an application for SEARs is adequate to allow consideration of the sufficiency of the relationship between the SSD and non-SSD components of a proposed development; as such an application contains particulars of the location, nature and scale of the development or activity.

Grounds six and seven: relief sought

1. The Department submits that the Court is not entitled to make a declaration that the Proposed Development is SSD; as such a decision is at the discretion of the Secretary. Besmaw accepted this point during the hearing, noting that the Court should rather order the Secretary to make the decision again.
2. In relation to the order seeking mandamus to require the Secretary to make a decision regarding SEARs, the Department submits that the Secretary's Decision on 24 June 2017 effectively rejected the SEARs request in its current form, and therefore the question of whether the Court should order mandamus does not arise.

Grounds one and two: errors in the construction and application of "sufficiently related"

1. Besmaw submits that while the words "sufficiently related" may involve some discretion on the part of the Secretary, importantly this discretion is not unbridled. Rather, the Secretary must apply the words properly and in accordance with the law. Besmaw submits that the words bear a distinct meaning which is different from that applied by the Secretary.
2. Further, Besmaw submits that the Department overstates its position in submitting that the SRD SEPP gives no implicit weighting in favour of determining proposed developments as a whole. The fact that the EPA Act contemplates mechanisms for treating aspects of a single project differently, Besmaw submits, indicates no more than that exceptions can be made to the default position.
3. Besmaw submits that the Department has not advanced any cogent reasons as to why the size of the non-SSD components of the Proposed Development or the fact that the non-SSD components do not have the characteristics of tourist accommodation are relevant to determining whether they are "sufficiently related" to the SSD components. Besmaw submits that this point stands even if the Secretary did not treat the size of the condominiums as determinative. Similarly, Besmaw submits that the Department has not made out that the Secretary properly considered the material before it that the condominiums were only permissible under the Kurnell SEPP if used "in conjunction with" the tourist facilities.
4. Besmaw submits that the Department's submission regarding the 'alternative appropriate pathway' appears to depend on the proposition that the Briefing Note does not set out the Secretary's reasoning in its entirety. However, Besmaw notes that the Secretary stated that she made the decision "in accordance with the reasons given in [the] briefing note".

Grounds three and four: failure to afford a fair hearing and apprehended bias

1. Besmaw disputes the Department's submission that the Secretary was not obliged to afford it procedural fairness, submitting that this ignores the prevailing High Court authority of WZARH. Besmaw submits that the legal and practical effect of the Decision is to preclude it from applying for development consent for a multi-million dollar development, which necessarily affects its interests.
2. In relation to the Speakman Letter, Besmaw submits that the fact that 80% of the letter addressed an issue other than the issue of "sufficiently related", is no answer to its allegation. Rather, this demonstrates the fact that the Secretary was distracted from the real issue, and further emphasises the need for the letter to have been put to Besmaw. Besmaw further submits that it is no answer to suggest that it was aware of the issues that the Secretary was going to decide, or that the Secretary ultimately did not adopt the conclusions in the Speakman Letter. The critical issue giving rise to a denial of procedural fairness, Besmaw submits, is the failure to put the adverse material before it and allow it to respond.

Ground five: the Secretary made a cl 8(2)(a) determination without a development application

1. Besmaw submits that had the legislature intended for the term 'development application' in s 8(2)(a) to apply to a 'proposed development application', it would have expressly stated so, particularly given it uses the words 'proposed development' later in the clause.

Ground seven: duty to issue SEARs

1. Besmaw submits that the EPA Regulations require the Secretary to issue SEARs within 28 days of a request. Given that time has long past, the Secretary must issue SEARs.

Consideration

1. I will consider each of these issues in turn.

Statutory construction of cl 8(2)(a) of the SRD SEPP

Is there a "default" position?

1. The question of whether cl 8(2)(a) of the SRD SEPP contains a "default" position is primarily an issue of statutory construction.
2. The starting point for statutory construction is to construe legislative provisions in accordance with the ordinary and grammatical meaning of the language used: Project Blue Sky at [78]. Further, legislative provisions are to be read in the context of the instrument as a whole "so as to provide that each of its terms are intended to give effect to harmonious goals" Heatscape Pty Ltd v Mahoney [2017] NSWCCA 135 ('Heatscape') at [36], see also Project Blue Sky at [70]; CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384; [1997] HCA 2. Importantly, while subordinated legislation may not be drafted with the same scrutiny as primary legislation (see Environmental Protection Authority v Condon as liquidator for Orchard Holdings (NSW) Pty Ltd (2014) 86 NSWLR 499; [2014] NSWCA 149 at [44] per Leeming JA, with whom Bathurst CJ and McColl JA agreed), the same principles of statutory construction apply, and such legislation is to be construed as part of the whole legislative regime: see Federal Commissioner of Taxation v Consolidated Media Holdings Ltd (2012) 250 CLR 503; [2012] HCA 55 at [39]; Heatscape at [34] and [39].
3. Applying this approach to cl 8(2)(a) of the SRD SEPP, a plain word reading of the clause illustrates that where a proposed development is only partly SSD, the Secretary is to declare the remainder of the development to be SSD unless that remainder is "not sufficiently related" to the SSD. In that sense only, I am satisfied, as Besmaw submits, that the clause does envisage a "default position" whereby the Secretary is to start from the position that the non-SSD components of a proposed SSD are to be declared SSD, and only carve out those components if the Secretary determines that those non-SSD components are not sufficiently related to the development as a whole.
4. Besmaw's submission is that the Secretary misconstrued the statutory task required in cl 8(2)(a) by ignoring the "default position". I am not satisfied that this error is manifest in the Decision. First, the Department explicitly accepts in its written submissions that the clause contains such a "default position". Second, I accept the Department's submission that the "default position" operates as a default should the Secretary not make a determination under cl 8(2)(a), rather than a presumption in favour of declaring the non-SSD components SSD. Importantly, the presence of a default position does not necessarily carry with it the requirement to give an "implicit weighting" to that position, as contended by Besmaw. Rather, a default position operates to cater for circumstances where no action is taken. Clause 8(2) of the SRD SEPP does not operate in isolation from subclauses (a) and (b), and in order for the default position to arise, the Secretary is entitled, and indeed required under the clause, to turn her mind to those considerations that exclude certain non-SSD components from being declared SSD.
5. Focusing on cl 8(2)(a), the effect of the "default position" is that if the Secretary, having turned her mind to the non-SSD components, does not determine that they are "not sufficiently related", the whole development will be declared SSD. The essential question for the purposes of cl 8(2)(a) is therefore whether the non-SSD components are "not sufficiently related" to the Proposed Development, and the fact of the default position does not create any weighting in this regard.

Meaning of the words "sufficiently related to"

1. Besmaw's submission is that the Secretary erred in determining the 'sufficiency' of the relationship between the non-SSD and SSD components of the Proposed Development.
2. In considering this issue, it is instructive initially to have regard to the meaning of the words "related to". I accept Besmaw's submission that the words "related to" are to be construed broadly, see Project Blue Sky at [87]; Cardile at [108]. As stated in Australian Competition and Consumer Commission (ACCC) v Maritime Union of Australia and Others (2001) 114 FCR 472; [2001] FCA 1549 at [68] per Hill J: It may be accepted that there will always be a question of degree involved where the issue is the relationship between two subject matters. The words "in relation to" are wide words which do no more, at least without reference to context, than signify the need for there to be some relationship or connection between two subject matters: see Smith v FCT (1987) 164 CLR 513 ; 74 ALR 411 at CLR 533 per Toohey J and PMT Partners Pty Ltd (in liq) v Australian National Parks and Wildlife Service (1995) 184 CLR 301 ; 131 ALR 377 at CLR 328 per Toohey and Gummow JJ. But the phrase is both "vague and indefinite": see per Taylor J in Tooheys Ltd v Commissioner of Stamp Duties (NSW) (1961) 105 CLR 602 at 620. Like the phrase "in respect of", the phrase "in relation to" will not, at least normally, apply to any connection or relationship no matter how remote: see Technical Products Pty Ltd v State Government Insurance Office (Qld) (1989) 167 CLR 45; 85 ALR 173 at CLR 51 per Dawson J. The extent of the relationship required will depend upon the context in which the words are used.
3. However, as submitted by the Department, it is clear also that the words "related to" are to be construed having regard to the statutory context, see Construction Forestry Mining and Energy Union (CFMEU) v Mammoet Australia Pty Ltd (2013) 248 CLR 619; [2013] HCA 36 at [40]; Western Australia v Ward (2002) 213 CLR 1; [2002] HCA 28 at [644].
4. Considering the text of cl 8(2)(a) of the SRD SEPP, the words "related to" are preceded by the word "sufficiently", which accordingly qualifies the degree of relationship required between the SSD and non-SSD components of the Proposed Development. The word "sufficiently" is defined in the Macquarie Dictionary as "that suffices; enough or adequate". While this is not a significant qualification on the words "related to", it does import an evaluative task and implies an element of discretion, in that the Director-General or his or her delegate must be satisfied that the relationship between the SSD and non-SSD components of a proposed development is "sufficient".
5. The question then becomes what factors, if any, the Secretary is required to consider in determining whether parts of a development are "sufficiently related to" one another for the purposes of cl 8(2)(a) of the SRD SEPP. Besmaw submits that the Secretary erred in taking into account the relative size of the non-SSD components as compared to the SSD components, and by failing to take into account qualitative considerations such as the fact that condominium users will use the services and facilities of the hotels, and the ongoing legal and management relationship between resort management, owners/occupiers of the condominiums and the hotel operator.
6. I do not accept this submission. The SRD SEPP confers an unconfined discretion on the Director-General, except insofar as may be implied by the subject matter, scope and purpose of the SRD SEPP, see e.g. Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24; [1986] HCA 40 ('Peko-Wallsend') at 39; Price v Elder (2000) 97 FCR 218; [2000] FCA 166 at [13]. The SRD SEPP does not set out any criteria to which the Secretary must, or indeed must not, have regard, and accordingly it was open to the Secretary to consider the relative size of the non-SSD components of the Proposed Development in forming an opinion as to whether they were "sufficiently related to" the SSD components. The failure to circumscribe considerations which the Secretary must take into account is reflective of a legislative recognition that the Secretary, with her experience and understanding of public policy, is best placed to make the determination required in cl 8(2)(a). It is not for the Court to limit this discretion, other than in accordance with general principles of administrative decision-making.

Did the Secretary engage in irrational reasoning?

1. Clearly, the Secretary's discretion in making a determination under cl 8(2)(a) is not entirely unfettered, in that a decision that is unreasonable cannot be supported. As stated in Li at [72] per Hayne, Kiefel and Bell JJ, applying Peko-Wallsend: …in Minister for Aboriginal Affairs v Peko-Wallsend Ltd, Mason J considered that the preferred ground for setting aside an administrative decision which has failed to give adequate weight to a relevant factor of great importance, or has given excessive weight to an irrelevant factor of no importance, is that the decision is "manifestly unreasonable". Whether a decision-maker be regarded, by reference to the scope and purpose of the statute, as having committed a particular error in reasoning, given disproportionate weight to some factor or reasoned illogically or irrationally, the final conclusion will in each case be that the decision-maker has been unreasonable in a legal sense. (Citations omitted.)
2. While Besmaw did not advance a submission of unreasonableness, it did contend that the Secretary engaged in irrational reasoning, which amounted to a misunderstanding of the statutory task. As submitted by the Department, I do not consider "irrationality" to be a separate ground of judicial review, but rather, as noted above in Peko Wallsend, it can be an indication that a decision was unreasonable in a legal sense. This is a high standard, and as stated in Minister for Immigration and Citizenship v SZMDS (2010) 240 CLR 611; [2010] HCA 16 at [131] per Crennan and Bell JJ: …the test for illogicality or irrationality must be to ask whether logical or rational or reasonable minds might adopt different reasoning or might differ in any decision or finding to be made on evidence upon which the decision is based. If probative evidence can give rise to different processes of reasoning and if logical or rational or reasonable minds might differ in respect of the conclusions to be drawn from that evidence, a decision cannot be said by a reviewing court to be illogical or irrational or unreasonable, simply because one conclusion has been preferred to another possible conclusion.
3. I do not accept that the factors that the Secretary had regard to in forming the Decision were irrational in the sense that the Decision was unreasonable. Rather, I am satisfied that, while the Secretary placed more weight on certain considerations over others contended by Besmaw to be of importance, this is simply illustrative of "different processes of reasoning" upon which logical, rational or reasonable minds may differ in respect of the conclusions.
4. In any case, I note this submission primarily relies on one sentence in the Briefing Note, that the condominiums "do not have the characteristics of tourist accommodation necessary to demonstrate a sufficient land use relationship to the hotel and other tourist facilities". As demonstrated by the Briefing Note, particularly Attachment D to the Briefing Note (a table prepared by the Department listing each of the non-SSD components, summarising Besmaw's justification as to why each component was "sufficiently related", and stating the Department's recommendation as to each non-SSD component), the Secretary had regard to a number of considerations in making the Decision. I do not consider that this single sentence is demonstrative of irrationality in the Decision as a whole.

Did the Secretary incorrectly apply an ancillary, incidental or complementary test?

1. Besmaw contends that a further ground upon which the Secretary erred in approaching the statutory task required under cl 8(2)(a) of the SRD SEPP is by incorrectly assuming that the clause required consideration of whether the non-SSD components were ancillary, incidental or complementary to the SSD components. For the reasons that follow, I do not accept this submission.
2. First, as submitted by the Department, I do not consider these terms to reflect the sole criterion adopted by the Secretary in determining whether or not the non-SSD components were sufficiently related to the SSD components of the Proposed Development. Rather, they illustrate some of the characteristics that the Secretary had regard to in making the Decision. As noted above, the statutory task required in cl 8(2)(a) of the SRD SEPP confers a broad discretion on the Secretary, and I do not find that in considering concepts of ancillary, incidental or complementary the Secretary erred in determining the question of "sufficiently related to".
3. Second, in relation to the contended 'complementary' test, Besmaw's submission is that the Secretary, having adopted a test of "complementary" function, was bound to apply it and failed to do so. As above, I do not consider that the one phrase relied upon by Besmaw in the Briefing Note (that the retail and office space allocated is significantly greater than would "…reasonably fulfil an ancillary, supporting or complementary function to the tourism or health uses") is sufficient to demonstrate that the Secretary adopted a test of 'complementary', particularly in a way that led her to error in determining the question of "sufficiently related to". In any case, even if it were accepted that the Secretary adopted a test of 'complementary', I accept the Department's submission that the present facts are distinguishable from the case of Tanielu relied upon by Besmaw, in that the concept of 'complementary', unlike the concept of 'unacceptable risk' in that matter, does not have any substantive established content in Australian law, and accordingly Besmaw has failed to demonstrate that the Secretary made any error of law in applying it.

Conclusion on statutory construction grounds

1. Ultimately, while I accept that there is a "default position" in cl 8(2)(a) of the SRD SEPP that the non-SSD components of a proposed development are to be declared SSD, this "default position" only comes into operation should the Secretary not make a determination under cl 8(2)(a) that the non-SSD components are "not sufficiently related to" the SSD components. In this case, the Secretary did make such a determination, and accordingly the default position does not come into play. While the Secretary's discretion to make such a determination under cl 8(2)(a) is clearly not unconstrained by principles of administrative law, the legislation itself does not impose any discrete constraints on the Secretary by prescribing criteria that she must, or must not, have regard to. Accordingly, so long as the Decision is not unreasonable in a legal sense, the Secretary was entitled to consider and place weight upon the factors that she deemed relevant in making the Decision.
2. Overall, the text of the Briefing Note, together with the attachments, demonstrates that the Secretary had regard to a broad range of matters in making the Decision. While she ultimately decided to give more weight to certain considerations over others, this is demonstrative of the nature of public policy decision-making, rather than a manifestation of legal error.

Failure to afford Besmaw an opportunity to be heard in respect of the Speakman Letter

1. Besmaw submits that the Secretary owed a duty of procedural fairness in making the Decision, and that the Secretary breached that duty by failing to disclose the Speakman Letter to it and allow it the opportunity to address the letter. I will address this submission by considering first whether the Decision attracts procedural fairness, and second, if so, whether or not the Secretary breached this duty.

Does the Decision attract procedural fairness?

1. The Department submits that the Decision is not one that attracts procedural fairness as, relying on FAI Insurance at 360, the Decision is not one that has a direct or substantial adverse effect on some identifiable right, interest or privilege. The Department submits that the Decision involves neither consent to, nor rejection of the development application.
2. The primary issue for consideration in determining whether there is a duty is whether or not Besmaw's rights, interests or privileges were affected by the Decision. For the reasons that follow, I find that the Decision does attract procedural fairness.
3. The starting point for determining whether a duty of procedural fairness arises is stated in WZARH at [30], where Kiefel, Bell and Keane JJ stated that: It is sufficient to say that, in the absence of a clear, contrary legislative intention, administrative decision-makers must accord procedural fairness to those affected by their decisions... the real question [is]; namely, what is required in order to ensure that the decision is made fairly in the circumstances having regard to the legal framework within which the decision is to be made. (Emphasis added.)
4. In the present proceedings, neither party contends that the Decision is not a "decision", and it is clear that it is made by an administrative decision-maker. Further, there were no submissions suggesting that the SRD SEPP evinces an intention to displace the requirement of procedural fairness.
5. The Department's submission that the Decision does not affect any rights, interests or privileges as it simply determines the procedures that might be applied to the future assessment of the Proposed Development is not, in my view, persuasive for two reasons.
6. First, I note that it is open as to whether the Decision precludes Besmaw from submitting an application for SSD altogether. As stated by Spigelman CJ in Currey v Sutherland Shire Council and Russell [2003] NSWCA 300; (2003) 129 LGERA 223 at [35]: I see very little, if any, scope in this legislative scheme for the concept of a "valid" application. Citizens are entitled to apply to authorities for whatever they like. The relevant prohibition in the legislative scheme is found in s 76A, which prohibits development without consent, where an environmental planning instrument provides that development may not be carried out except with consent. There is no relevant prohibition, express or implied, which impinges upon the application making process. [Emphasis added.]
7. While Besmaw may potentially still be able to submit an application for SSD for the Proposed Development, the Decision (to the extent that it declares that the Proposed Development is not SSD) clearly affects Besmaw's interests by essentially denying the possibility that the application will be successful. The SSD application for the Proposed Development (including all its components) is thereby effectively rendered futile.
8. Seen from this perspective, the Decision clearly affects Besmaw's interests. As stated in FAI Insurance (at 412) the term "interest" can include a proprietary or financial interest: The aptitude of the exercise of the power to affect proprietary or financial interests or reputation furnishes a surer ground for implying that the principles of natural justice are to be applied in its exercise.
9. Given the scale of the Proposed Development, and the fact that it is estimated to be a multi-million dollar development, it is clear that the Decision substantially affects Besmaw's interests.
10. Second, even on the basis that Besmaw, despite the Decision, is able to proceed with submitting a development application, the practical effect of the Decision is that the Secretary has not issued SEARs, which is a preceding step to the preparation of an environmental impact statement. While Besmaw could conceivably still submit an environmental impact statement, it would not be in the manner stipulated by the legislative scheme. Accordingly, the effect of the Decision is to prevent Besmaw from submitting a development application (with accompanying material) for the Proposed Development strictly in accordance with the procedures provided in the EPA Act and the EPA Regulations. I find that this too is an identifiable "right, privilege or interest".
11. In summary, the legislative scheme provides for a particular manner in which an application for SSD is to be prepared. By determining that the non-SSD components are not "sufficiently related" to the SSD components and accordingly not issuing SEARs, the Secretary has denied Besmaw the right to prepare its application in the prescribed manner. The likely consequence of failing to prepare an application in the prescribed manner is that the application will not be accepted. Therefore the denial of the right to prepare an environmental impact statement that is responsive to SEARs, procedural though it may be, nevertheless has a substantial effect on Besmaw.

Whether not disclosing the Speakman Letter to Besmaw amounts to a denial of procedural fairness

1. Besmaw contends that the Speakman Letter contained material adverse to it, and in accordance with the requirement for procedural fairness, the Secretary should have put to it the letter. Besmaw relies on Alphaone at 591-2, that: Where the exercise of a statutory power attracts the exercise of procedural fairness, a person likely to be affected by the decision is entitled to put information and submissions to the decision-maker… That entitlement extends to the right to rebut or qualify by further information, and comment by way of submission, upon adverse material from other sources which is put before the decision-maker.
2. Importantly, later in that paragraph Northrop, Miles and French JJ stated: The decision-maker is required to advise of any adverse conclusion which has been arrived at which would not obviously be open on the known material. (Emphasis added.)
3. In that case, the Court found that the fact that the decision-maker did not put to the applicant the evidence from third parties was not indicative of a lack of procedural fairness as the evidence was "superfluous" given the company's admissions (at 592). While there are no analogous admissions in the present proceedings, the Court in Alphaone (at 592) considered the "real question" to be whether the decision-maker could, without inviting further submissions, come to the conclusion that he did. When answered in the affirmative, there is no failure of natural justice.
4. The variability of the requirements of procedural fairness was addressed by Gageler J in CPCF v Minister for Immigration and Border Protection (2015) 255 CLR 514; [2015] HCA 1 at [44]: Procedural fairness as implied in some contexts can have a flexible, chameleon-like, content capable of varying according to the exigencies of the exercise of power between nothingness at one extreme and a full-blown trial at the other. To imply procedural fairness as a condition of the lawful exercise of a statutory power is therefore not necessarily to require a hearing in every case in which the power might be exercised. Ordinarily, procedural fairness does not require providing a person whose interests are likely to be affected by an exercise of statutory power any greater opportunity to be heard than is reasonable in all the circumstances.
5. Applied to the present proceedings, I am not persuaded that the Secretary's failure to disclose the Speakman Letter to Besmaw amounts to a denial of procedural fairness. As submitted by the Department, while Besmaw was not shown the physical letter, the substance of the letter in the sense of the concerns raised in the letter were in fact well known by Besmaw. Notably, as the Department submits: 1. Besmaw met with officers of the Department on 15 December 2015 after having submitted its initial SEARs request, and a file note produced documenting that meeting noted that "The Department questioned the proposed residential portion of the development and how the operation of condominiums will be integrated with tourism uses"; 2. on 16 December 2015, an employee of Urbis (planning consultants engaged by Besmaw), sent an email to various Departmental officers explaining the relationship between the SSD and non-SSD components of the Proposed Development; 3. on 18 December 2015, the Department sent Urbis a letter stating that the Department was "unlikely to issue SEARs for the project in its current form" and that "[w]hile the tourist and hospital components of the proposal meet the minimum capital investment value for State significant development, the Department is not satisfied that the remainder of the development is sufficiently related to these components."; 4. on 14 January 2016, representatives of Besmaw met with officers of the Department who explained that the SEARs request "did not demonstrate that the non-SSD components were sufficiently related to the SSD components."; 5. Besmaw submitted on 22 January 2016 a "consolidated" SEARs request, which contained material specifically addressing the relationship between the SSD and non-SSD components; 6. on 6 April 2016 representatives of Besmaw met with officers of the Department, who indicated that the "Department was likely to form the view that the various uses were not sufficiently related in order to consider the project as SSD".
6. I also find persuasive the fact that Besmaw met with Mr Speakman on 2 May 2016 and the substance of that meeting was conveyed by Urbis to the Department in an email dated 5 May 2016, which noted that Mr Speakman did not support the potential density of the development.
7. Further, I accept the Department's submission that the failure to disclose the Speakman Letter does not result in any "practical injustice" being incurred by Besmaw as per Ex parte Lam at [37]-[38] per Gleeson CJ. In that case the High Court found that there was no "practical injustice" as the "applicant lost no opportunity to advance his case" (at [38]), and that it was not "shown that he lost an opportunity to put any information or argument to the decision-maker" (at [36]).
8. Importantly, with the exception of four paragraphs at the beginning of the letter, the majority of the letter addresses the permissibility of the Proposed Development under the Kurnell SEPP. While permissibility of the Proposed Development under the Kurnell SEPP is necessary to trigger cl 8(2)(a) of the SRD SEPP, this is not determinative of whether the non-SSD components are "sufficiently related" to the SSD components for the purposes of cl 8(2)(a) of the SRD SEPP.
9. I do not accept Besmaw's submission as per Jagroop at [70] that while the Secretary may not have given weight to the contents of the Speakman Letter, it nevertheless could have had a subconscious effect on her mind. This point rather appears to go to Besmaw's claim that the Speakman Letter created an apprehension of bias - which I will address in the following section.
10. In the circumstances I am not satisfied that the Secretary's conduct in not putting the Speakman Letter to Besmaw was a denial of procedural fairness. To the extent the letter contained material relevant to the Decision, while strongly worded; it did not raise any issues of which Besmaw was unaware. Besmaw was well aware of the concern that the non-SSD components of the Proposed Development were not sufficiently related to the SSD components, and was given various opportunities to address these concerns. As per Alphaone (at 592), to the extent the Speakman Letter addressed considerations relevant to the Decision I find that those concerns were "superfluous" given the evidence already before the Secretary and known to Besmaw, and the Secretary was therefore not required to put the letter to Besmaw.

Apprehension of bias

1. As noted above, Besmaw's further submission is that the Speakman Letter gives rise to an apprehension of bias on the part of the Secretary. Applying Isbester at [20]-[21], Besmaw submits that to a fair-minded observer, the Secretary's receipt and consideration of the Speakman Letter which opposed the Proposed Development in "strident" terms, might cause a reasonable apprehension that the Secretary made the Decision other than on its legal and factual merits.
2. The Court in Isbester referred to the decision in Ebner v The Official Trustee in Bankruptcy (2000) 205 CLR 337; [2000] HCA 63 at [8] ('Ebner'), where the Gleeson CJ, McHugh, Gummow and Hayne JJ stated in respect of determining possible bias: The apprehension of bias principle admits of the possibility of human frailty. Its application is as diverse as human frailty. Its application requires two steps. First, it requires the identification of what it is said might lead a judge (or juror) to decide a case other than on its legal and factual merits. The second step is no less important. There must be an articulation of the logical connection between the matter and the feared deviation from the course of deciding the case on its merits. The bare assertion that a judge (or juror) has an "interest" in litigation, or an interest in a party to it, will be of no assistance until the nature of the interest, and the asserted connection with the possibility of departure from impartial decision-making, is articulated. Only then can the reasonableness of the asserted apprehension of bias be assessed.
3. Here, Besmaw contends that the following considerations led the Secretary to make the Decision other than on its merits: 1. the "strident" language used in the letter (e.g. "Besmaw proposes an egregious overdevelopment…", "I request that you and your department do everything legally permissible to prevent the proposal proceedings…"); 2. the fact that the letter was expressed in coherent terms and argued essentially as a legal argument, drafted by a person with high level legal qualifications; 3. the fact the letter was sent by the local member, who was also Minister for the Environment at the time, on a letterhead stated "Mark Speakman SC MP, Member for Cronulla"; and 4. the fact that the letter was sent to the Department by the (at the time) Minister for Planning, marked as being of "high importance", and therefore was impliedly supported by that Minister.
4. While I accept that the Speakman Letter was strongly worded and conveyed a clear position in regards to the Proposed Development, I do not find that it gives rise to a reasonable apprehension of bias on the part of the Secretary for the following reasons: 1. First, the Secretary is the most senior member of the Executive Team of the Department of Planning, and I do not accept that the language used in the letter, "strident" though it may be, would cause the Secretary to consider herself bound to effect Mr Speakman's position in a way that triggers the first limb of Isbester. 2. Second, the nature of the Secretary's position is such that it would be conceivable that she would receive strongly worded, well-constructed letters supporting or opposing developments as a matter of course, and the implication that the receipt of such a letter gives rise to an apprehension of bias should not be supported. 3. Third, the letterhead makes clear that Mr Speakman wrote the letter in the context of his role as local member, not Minister for Environment and Heritage, and I am not persuaded that the fact that the letter was sent by a local member gives rise to an apprehension of bias. Rather it is well within the responsibilities of local members to advocate for the interests of their electorate. 4. Finally, I do not accept that the fact that the letter was forwarded from the Minister of Planning to the Department implies that the Minister supported the Speakman Letter. Rather, having delegated the decision-making function to the Secretary in respect of the Proposed Development, the more likely construction is that the Minister for Planning was forwarding the correspondence to the relevant authority.
5. As noted above, the Speakman Letter goes primarily to the permissibility of the Proposed Development under the Kurnell SEPP. Little reference is made in the Briefing Note to the Kurnell SEPP, the focus is rather on the concept of "sufficiently related". Indeed where reference is made to the Kurnell SEPP under the subheading "Alternative appropriate pathways", it is to state that the intended uses are permitted by the Kurnell SEPP, which expressly contradicts the Speakman Letter (and indeed is not in dispute between the parties). In the circumstances therefore, I do not find that the Secretary's receipt and consideration of the Speakman Letter gives rise to a reasonable apprehension that there was a "… deviation from the true course of decision-making" (per Isbester at [21]).

Whether the Secretary acted prematurely in determining the Proposed Development is not SSD

1. For the reasons summarised above, Besmaw submits that the Secretary is only able to make a determination under cl 8(2)(a) of the SRD SEPP once a development application has been made. Here, Besmaw submits, the development application was still in the preparatory stages, and accordingly the Secretary was not entitled to determine that the Proposed Development was not SSD. For the reasons that follow, and not without some hesitation, I do not accept this submission.
2. Besmaw's submission relies primarily on a strict construction of the words of cl 8(2)(a) of the SRD SEPP, submitting that the words "the subject of one development application" require a development application to be in existence, and that if the legislature had intended the section to apply to a proposed development application, it would have so stated. I do not accept this submission.
3. The EPA Act defines "development application" as follows: development application means an application for consent under Part 4 to carry out development but does not include an application for a complying development certificate.
4. On a plain reading of the definition, it appears to refer to a development application that is in existence, rather than one in the process of being prepared. However, I note the statement of Gleeson, Rothman and Button JJA in Heatscape at [37] that: It is also well established that a definition "is no more than an aid to construction of the statute": Gibb v Federal Commissioner of Taxation (1966) 118 CLR 628; [1996] HCA 74 at CLR 635. The meaning of a definition turns on the context in which it appears, considered as a whole: Cranbrook School v Woollahra Municipal Council (2006) 66 NSWLR 379; [2006] NSWCA 155 at [39] and the cases there cited. Importantly, as McHugh J explained in Kelly v The Queen (2004) 218 CLR 216; [2004] HCA 12 at [103]: …[T]he function of a definition is not to enact substantive law. It is to provide aid in construing the statute… To construe the definition before its text has been inserted into the fabric of the substantive enactment invites error as to the meaning of the substantive enactment… [T]he true purpose of an interpretation or definition clause [is that it] shortens, but is part of, the text of the substantive enactment to which it applies."
5. It is clear from the context of the legislative scheme (including the EPA Act, the EPA Regulations and the SRD SEPP) that the term "development application" is not used solely to apply to development applications that are already in existence. Rather, in certain circumstances, the term is also used to refer to a proposed development application. One such example is cl 4(1) of Sch 2 to the EPA Regulations, which provides as follows: An application for environmental assessment requirements must, in the case of a development application for integrated development, also include particulars of the approvals that are required.
6. Similar to the above, provisions specifically relating to development applications for SSD provide that environmental assessment requirements (or SEARs) must be requested before preparation of the environmental impact statement (cl 3(1) of Sch 2 to the EPA Regulations), and that the development application is to be accompanied by an environmental impact statement (s 78A(8A) of the EPA Act). It is clear therefore that the term "development application" cannot be used to solely refer to a development application that is already in existence, but rather, can also be used to describe development applications that are in the course of being prepared.
7. There is clearly an element of ambiguity, when the relevant legislative instruments are considered together, as to when the Secretary is called upon to make a determination under cl 8(2)(a) of the SRD SEPP.
8. On Besmaw's construction of the SRD SEPP, the Secretary would only be entitled to make a declaration that a proposed development is not SSD once the development application has come into existence. On the Department's construction of the SRD SEPP, the Secretary is entitled to make a declaration under cl 8(2)(a) in the context of assessing a request for SEARs, and indeed is required to determine whether a proposed development is SSD prior to determining a request for SEARs. The Department's construction is to be preferred for a number of reasons: 1. First, in circumstances where a development has been proposed that clearly cannot be characterised as SSD under Schedule 1 or 2 of the SRD SEPP (for example a development for a purely residential complex), if the Secretary was not able to make the determination under cl 8(2)(a) of the SRD SEPP at the time of the request for SEARs, the Secretary would be, in accordance with, cl 3(4) of Sch 2 to the EPA Regulations, required to consult with public authorities and prepare and issue SEARs, and the applicant would then prepare an environmental impact statement and proceed with preparation of the development application, all in circumstances where it is clear that development is not SSD. To adopt this approach would result in a considerable waste of time and money on the part of the Department, other relevant public authorities, the applicant, and the Minister as the consent authority - which evidently is to be avoided. While this consideration is clearly not determinative of the manner in which cl 8(2)(a) is to be construed, given the ambiguity of the clause, an interpretation that avoids the risk of substantial waste of public and private resources is clearly to be favoured. 2. Second, as submitted by the Department, cl 3(9) of Sch 2 to the EPA Regulations permits the Secretary to waive the requirement to apply for SEARs for particular types of developments, including certain State significant developments. Clearly, a development must be identified as being SSD before the Secretary can exercise this power. Whilst, under cl 8(1) of the SRD SEPP a development can be declared SSD without any positive determination by the Secretary, as the Department submits and I accept, it would be "absurd" if, in dealing with a SEARs request, the Secretary could have regard to whether a proposed development is SSD under cl 8(1) of the SRD SEPP, but could not, if the circumstances so warranted, exercise her power under cl 8(2)(a) of the SRD SEPP to determine that a proposed development is not SSD. Clause 3(4) of Sch 2 to the SRD SEPP and s 78A(8) and (8A) similarly stipulate requirements that an applicant is to comply with in preparing an application for SSD. Accordingly, construing the legislative scheme as a whole, it is clear that a development is able to and indeed required to be characterised as SSD before a development application is made. 3. Third, while it may seem that the Secretary is pre-determining the development application in circumstances where an applicant has not been given the opportunity to fully formulate and put its case (as submitted by Besmaw), I find that, in applying for SEARs, the legislative scheme provides for an applicant to provide sufficient information for the Secretary to make the determination under cl 8(2)(a) of the SRD SEPP. Specifically, cl 3(2) of the EPA Regulations requires an applicant to "include particulars of the location, nature and scale of the development or activity" in its application for SEARs. While naturally the environmental impact statement allows an applicant to submit further information regarding the proposed development (see for example cl 7(1)(b) and (d)(i) of the EPA Regulations), I find that it is open for an applicant, in making the request for SEARs, to include a substantial amount of information regarding the development and its characterisation as SSD. Applied specifically to the present proceedings, it was clear to both parties that the Secretary had concerns regarding the characterisation of the Proposed Development, with the Secretary exercising her power in cl 3(2) of the EPA Regulations to request Besmaw to provide further information (which it did) as to the characterisation of the Proposed Development as SSD. I do not accept that the Secretary has acted prematurely by making a declaration under cl 8(2)(a) of the SRD SEPP, rather, I find that the Secretary is able to and is entitled to make this determination at this otherwise preliminary stage.
9. The above reasoning aside, it is not clear on Besmaw's construction how exactly the Secretary would be able to make a determination under cl 8(2)(a) of the SRD SEPP under the relevant legislation, if not at this stage in the process. Importantly, the consent authority for an application for SSD is the Minister, or his or her delegate (s 89D of the EPA Act). The decision-maker for the declaration under cl 8(2)(a) is the "Director-General", taken by the parties and I accept as being the Secretary, who also has authority to issue SEARs under the EPA Regulations.
10. I accept that the construction of cl 8(2)(a) proposed by the Department requires the determination that a development is not SSD to be made at a preliminary stage of the consent process. However, I find that the construction proposed by Besmaw sits uncomfortably within the scheme of the EPA Act. In circumstances where there is an element of ambiguity concerning what stage of the consent process a determination under cl 8(2)(a) of the SRD SEPP may be made, I find that the Department's construction is both available and preferable so as to give harmonious effect to the legislative regime.

Whether the Secretary was bound to conclude that the Proposed Development was declared to be SSD

1. Ground six of Besmaw's submissions was that, if the Court finds that the Secretary was entitled to make the declaration under cl 8(2)(a) of the SRD SEPP, given the Secretary's misconstruction of the statutory task required and her reliance on various irrelevant considerations, there was no lawful basis for concluding that the non-SSD components of the Proposed Development were not sufficiently related to the SSD components.
2. The Department submits, and I accept, that this is not a separate ground of review, but rather addresses the relief that Besmaw seeks.
3. Given my findings above that the Secretary did not err in making the Decision, Besmaw's submission in ground six falls away.

Whether, if the Secretary has not made a decision in respect of the SEARs request, she should be ordered to make a decision

1. Besmaw's final submission was that, to the extent the Decision did not involve an implicit refusal to notify SEARs, the Secretary has failed to issue SEARs within 28 days of the request (pursuant to cl 2 of Sch 2 to the EPA Regulations), and the Court should make an order requiring the Secretary to make a decision in respect of the SEARs request.
2. Besmaw's primary contention however is that the Decision did involve an implicit refusal to notify SEARs. The Department similarly submits that the Decision effectively rejected the SEARs request in its current form.
3. In relation to Besmaw's submission that the EPA Regulations gives no discretion to the Secretary to fail to issue SEARs once the required time has elapsed, to the extent the Secretary is so bound, this requirement only arises in relation to applications for SSD or integrated development pursuant to s 78A(8) and (8A) of the EPA Act. In the present circumstances, having made the Decision finding that the Proposed Development is not SSD, the Secretary is not required under the EPA Regulations to issue SEARs.

Conclusion and Orders

1. I find that Besmaw has not made out any of its grounds of challenge, and as such the proceedings should be dismissed.
2. The Court orders that: 1. The Further Amended Summons filed 4 November 2016 is dismissed. 2. The applicant is to pay the respondent's costs.

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. Decision last updated: 14 July 2017