Blanc Black Projects Pty Limited v Willoughby City Council - [2022] NSWLEC 1135 - NSWLEC 2021 case summary — Zoe

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Blanc Black Projects Pty Limited v Willoughby City Council

[2022] NSWLEC 1135

Land and Environment Court (NSW)|2021-12-02

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Source facts

Court

Land and Environment Court (NSW)

Decision date

2021-12-02

Catchwords

[2010] NSWLEC 65 Goldin v Minister for Transport Administering the Ports Corporatisation and Waterways Management Act 1995 (2002) 121 LGERA 101
[2002] NSWLEC 75 Lake Macquarie City Council v Hammersmith Management Pty Ltd (2003) 132 LGERA 225

Source

Original judgment source is linked above.

Catchwords

[2010] NSWLEC 65 Goldin v Minister for Transport Administering the Ports Corporatisation and Waterways Management Act 1995 (2002) 121 LGERA 101[2002] NSWLEC 75 Lake Macquarie City Council v Hammersmith Management Pty Ltd (2003) 132 LGERA 225

Judgment (34 paragraphs)

[1]

An application for consent for a residential flat building

COMMISSIONER: Blanc Black Projects Pty Limited (Applicant) has applied for development consent for the erection of a 4-storey residential flat building on the land described as Lots 1 and 2 DP 554171, known as 58 to 60 Eastern Valley Way, Northbridge (Site).
The Site has frontages to the Eastern Valley Way to the East, and Sailors Bay Creek Reserve to the North and West. There is a single dwelling house immediately to the South of the Site in Eastern Valley Way, and then a four-storey residential flat building. The Site has a total area of 1,560 m2 and slopes to the creek to the rear and side. The context of the Site can be seen in Figure 1:
Fig 1 - The site and surrounding area
The development application (DA), as originally lodged, sought development consent for the erection of a residential flat building comprising 12 apartments. On 12 October 2021 the Court, exercising the powers of the consent authority, agreed to the amendment of the DA in accordance with cl 55 of the Environmental Planning and Assessment Regulation 2000 (EPA Regulation). The amendment resulted in the deletion of one of the top floor apartments, and the reduction of the total gross floor area (GFA) of the building (amended DA). The Applicant uploaded the amended DA to the NSW Planning Portal on 13 October 2021.

[3]

The conditions in the Willoughby Local Environmental Plan 2021 (LEP)

The LEP imposes a number of conditions that must be satisfied before consent can be granted.
The Site is within Zone R3 Medium Density Residential under the LEP. Development for the purposes of a residential flat building is permitted with development consent on land within that zone.
Clause 2.3(2) of the LEP provides that, when determining the DA, the consent authority must have regard to the objectives for development in the R3 Medium Density Residential zone. Those objectives are:

To provide for the housing needs of the community within a medium density residential environment.
To provide a variety of housing types within a medium density residential environment.
To enable other land uses that provide facilities or services to meet the day to day needs of residents.
To accommodate development that is compatible with the scale and character of the surrounding residential development.
To allow for increased residential density in accessible locations, while minimising the potential for adverse impacts of such increased density on the efficiency and safety of the road network.
To encourage innovative design in providing a comfortable and sustainable living environment that also has regard to solar access, privacy, noise, views, vehicular access, parking and landscaping.

There was no dispute between the parties, and I accept, that the Proposed Development is consistent with all but the fourth objective, "To accommodate development that is compatible with the scale and character of the surrounding residential development". The consistency of the Proposed Development with the fourth zone objective is discussed later in this judgment at par [48].
The LEP sets height and floor space ratio development standards (cl 4.3 and cl 4.4). The Proposed Development complies with the floor space ratio standard but exceeds the 12 m height standard that applies to the Site. The Applicant has made a written request under cl 4.6 of the LEP that seeks to justify the contravention of the height standard. I will deal with that request later in this judgment.
The Site is flood affected and subject to the provisions of cl 5.21 of the LEP. Clause 5.21(2) provides that development consent must not be granted to development on land the consent authority considers to be within the flood planning area unless the consent authority is satisfied the development - (a) is compatible with the flood function and behaviour on the land, and (b) will not adversely affect flood behaviour in a way that results in detrimental increases in the potential flood affectation of other development or properties, and (c) will not adversely affect the safe occupation and efficient evacuation of people or exceed the capacity of existing evacuation routes for the surrounding area in the event of a flood, and (d) incorporates appropriate measures to manage risk to life in the event of a flood, and (e) will not adversely affect the environment or cause avoidable erosion, siltation, destruction of riparian vegetation or a reduction in the stability of river banks or watercourses.
The Council contends that development consent should be refused because the Proposed Development does not achieve the aim of cl 5.21 to minimise the risk to life and property associated with the use of the Site. I will deal with this contention and the expert evidence relating to it later in this judgment.
Clause 6.1(3) of the LEP requires the preparation of an acid sulfate soils management plan in certain circumstances. The parties are agreed, and I accept, that this clause does not apply to the Proposed Development given the classification of the land and its proximity to surrounding sites.
Clause 6.8(2) of the LEP provides that development consent must not be granted to the erection of residential accommodation on land which includes the Site, unless the consent authority has taken into consideration the matters set out in that clause. The Council contends that the DA, as it currently stands, does nothing to provide affordable housing, and accordingly a monetary contribution should be paid to the Council to be used for the purpose of providing, improving or replacing affordable housing. The Council has included a condition requiring the payment of such a contribution in its without prejudice conditions of consent (Ex 8). That condition, condition 27, requires the payment of a monetary contribution calculated as 4% of the accountable total floor area of the Proposed Development calculated by reference to the market value of dwellings of a similar size. The Applicant objects to the payment of such a contribution. I will return to the dispute about the Council's proposed condition later in this judgment.

[6]

Design Quality

The proposed development is a residential apartment development. State Environmental Planning Policy No 65 - Design Quality of Residential Apartment Development (SEPP 65) requires consideration and demonstration of the design quality of the development. There are three components to this: 1. Clause 28(2) requires: In determining a development application for consent to carry out development to which this Policy applies, a consent authority is to take into consideration (in addition to any other matters that are required to be, or may be, taken into consideration): (a) the advice (if any) obtained from the design review panel, and (b) the design quality of the development when evaluated in accordance with the design quality principles, and (c) the Apartment Design Guide. 1. Clause 30(2) requires: Development consent must not be granted if, in the opinion of the consent authority, the development or modification does not demonstrate that adequate regard has been given to: (a) the design quality principles, and (b) the objectives specified in the Apartment Design Guide for the relevant design criteria. 1. Clause 50(1A) of the EPA Regulation provides that a development application that relates to residential apartment development must be accompanied by a statement by a qualified designer. The statement by the qualified designer must: (a) verify that he or she designed, or directed the design, of the development, and (b) provide an explanation that verifies how the development - (i) addresses how the design quality principles are achieved, and (ii) demonstrates, in terms of the Apartment Design Guide, how the objectives in Parts 3 and 4 of that guide have been achieved." (cl 50(1AB) of the EPA Regulation).
The Applicant has provided a report showing how the Proposed Development addresses the design quality principles: SEPP 65 Design Statement prepared by Robert Gordon Woodward Registered Architect dated 3 March 2021 (Ex A, Tab 15), and also an Apartment Design Guide Workbook (Ex A, Tab 10). Following the conclusion of the hearing, with the consent of the Respondent, the Applicant also provided a Design Verification Statement prepared by Mr Robert Woodward dated 24 February 2022 which verified that he designed and supervised the preparation of the DA; that the Proposed Development has been designed in accordance with, and meets, the design quality principles in SEPP 65. The Design Verification Statement also contains an explanation of how the Proposed Development addresses those design quality principles and demonstrates how, in terms of the Apartment Design Guide, the objectives in Parts 3 and 4 of that guide have been achieved. The Design Verification Statement became part of Ex A, Tab 15.
I have considered the DA, including the amended architectural drawings, the Design Verification Statement and SEPP 65 Design Statement (Ex A, Tab 15) and the Apartment Design Guide Workbook (Ex A, Tab 10). I have taken into consideration the design quality of the Proposed Development, when evaluated in accordance with the design quality principles, and the Apartment Design Guide (as required by cl 28(2)). I am satisfied that the Proposed Development demonstrates that adequate regard has been given to the design quality principles and the objectives specified in the Apartment Design Guide for the relevant design criteria (as required by cl 30(2)). A design verification statement has been provided (as required by cl 50(1A) of the EPA Regulation).

[9]

The Applicant applies to vary the height standard

As noted above at par [15], the Proposed Development exceeds the height control contained in cl 4.3 of the LEP, and the Applicant has made a written request under cl 4.6 of the LEP that seeks to justify the contravention of the height standard.
Clause 4.3(2) of the LEP provides that the height of a building on any land is not to exceed the maximum height shown for the land on the Height of Buildings Map. The maximum building height for the Site shown on the Height of Buildings Map is 12 m. Part of the Proposed Development is 13.49 m in height and exceeds the height control by 1.49 m or 12%.
The Applicant's written request is contained in a report prepared by Stephen Gouge of Ethos Urban Pty Ltd dated 1 October 2021 entitled, "Clause 4.6 Variation Request Report Building Height - 58-60 Eastern Valley Way Northbridge" (Ex C).
As required by cl 4.6(3), the request seeks to justify the contravention of the height development standard by demonstrating that compliance with the development standard is unreasonable or unnecessary in the circumstances of the case and that there are sufficient environmental planning grounds to justify contravening the development standard.
The request contends that compliance with the height development standard is unreasonable or unnecessary because the objectives of the development standard are achieved notwithstanding non-compliance with the standard. The objectives of the height development standard are set out in cl 4.3(1) of the LEP as follows: (a) to ensure that new development is in harmony with the bulk and scale of surrounding buildings and the streetscape, (b) to minimise the impacts of new development on adjoining or nearby properties from disruption of views, loss of privacy, overshadowing or visual intrusion, (c) to ensure a high visual quality of the development when viewed from adjoining properties, the street, waterways, public reserves or foreshores, (d) to minimise disruption to existing views or to achieve reasonable view sharing from adjacent developments or from public open spaces with the height and bulk of the development, (e) to set upper limits for the height of buildings that are consistent with the redevelopment potential of the relevant land given other development restrictions, such as floor space and landscaping, (f) to use maximum height limits to assist in responding to the current and desired future character of the locality, (g) to reinforce the primary character and land use of the city centre of Chatswood with the area west of the North Shore Rail Line, being the commercial office core of Chatswood, and the area east of the North Shore Rail Line, being the retail shopping core of Chatswood, (h) to achieve transitions in building scale from higher intensity business and retail centres to surrounding residential areas.
The Council did not dispute that the Proposed Development is consistent with the objectives contained in pars (b) to (h). It did contend, however, that the Proposed Development would not be in harmony with the bulk and scale of surrounding buildings and the streetscape (objective (a)) (Transcript, 2/12/21, p 55).
The request contends that objective (a) is achieved as the Proposed Development is a four-storey residential flat building that "is in harmony with the bulk and scale of surrounding buildings, and the streetscape where the transition from single dwellings to residential flat buildings contemplated under the R3 zoning… has been realised. The variation (of) the building height control occurs at the northern portion of the streetscape façade, which arises in response to the sloping topography on the northern part of the site and flood hazards."
The request contends that the objective (b) is achieved as the Proposed Development does not impact on the existing views from any of the surrounding land. In terms of visual intrusion, the request states that the proposal has been carefully designed to balance northern aspect/outlook and amenity "while balancing the relationship of the site and proposal with surrounding land uses". The request continues, "At the upper level where the height is exceeded, the breach occurs on the northern part of the floorplate - having no impact to the adjoining residential land to the south". On the southern elevation adjoining the residential lots, the request contends that the design of the Proposed Development has been configured to minimise overlooking and overshadowing. As such, the request argues that the Proposed Development and the exceedance of the height control, will not have any additional adverse impact on adjoining, or nearby properties than would be the case of a compliant development.
In relation to objective (c), the request contends that the Proposed Development provides for a high visual quality of development when viewed from surrounding areas, and says that this is demonstrated in the photomontages and architectural plans which accompany the DA. The request explains that "The design language, form, materials and colour selection, combined with the harmonious scale and massing of the building in the streetscape and surrounding residential flat buildings results in a proposal that provides demonstrates (sic) high visual quality". The request also contends that, due to the setback of the upper level of the Proposed Development, the building height exceedance will not be visible from surrounding land.
The request notes that there is some overlap between objective (d) and objective (b) and argues the proposed height exceedance will not have any perceivable impact on visual privacy or outlook from adjacent development or public open spaces.
In relation to objective (e) the request contends that the "proposed bulk, scale and character of the building, including height, are consistent with the redevelopment potential of the site when responding to the various site-specific constraints. In particular, these relate to flooding and topography.
The request contends that the Proposed Development is consistent with, and responsive to the current and desired future character of the locality. It states that the majority of the Proposed Development complies with the numeric height control, and reflects the bulk, scale, and character of similar developments in the locality. The request argues that the Proposed Development is consistent with the desired future character for the land within the R3 zone in this part of the local government area which it says comprises four storey residential development of a similar bulk, form and scale as the proposed Development.
The request notes that objectives (g) and (h) are not relevant given the location of the Site.
The request concludes that strict compliance with the maximum height standard prescribed by cl 4.3 of the LEP is unreasonable and unnecessary because:

The objectives of the standard are achieved notwithstanding the non-compliance with the numerical standard;
The proposed building height is suited to the Site's unique setting, sloping topography and flooding hazard, and the specific design response results in a negligible impact when viewed from the surrounding area;
The Proposed Development is not located in the vicinity of any item of environmental heritage and will not impact on the understanding of heritage items located away from the Site; and
The proposed building height has been appropriately designed to its height and context, particularly through height transition to surrounding land, particularly Sailors Bay Creek, the use of landscaping and design appearance.

As to the second matter required to be demonstrated, the request contends that there are sufficient environment planning grounds to justify contravening the development standard as:

The site has a cross fall. The roof plate of the top storey is flat so that the roof plate breaches the height standard as the site falls away.
The proposal does not result in any unacceptable overshadowing impacts and overshadowing is not caused by the proposed variance to the building height control.
The ground floor of the Site cannot be lowered due to flood affectation from the adjacent creek.
The 12 m height control contemplates 4 storey development such as the Proposed Development.
The height and form of the building is compatible with the existing infill development as well as sites within the precinct that have been developed with residential flat buildings in line with the R3 medium density zoning.
The Site is of sufficient size to accommodate a residential flat building.
The proposed built form is compatible and harmonious with the scale, bulk, and streetscape of similar nearby development.
The Proposed Development is compatible with both the existing and likely future character of the area.
The height non-compliance does not negatively impact on views from any of the adjoining properties due to its height, siting, design and location.
The Proposed Development maintains adequate privacy as well as visual amenity to, and from all surrounding properties.
The design has optimised the northerly aspect towards the public open space which has minimised, as far as practical, any adverse impacts of the Proposed Development and the variation to the height standard.

The request also contends that the Proposed Development will be in the public interest because, first, it is consistent with the objectives of the height development standard for the reasons already given, and second, it is consistent with the objectives of the R3 Medium Density Residential zone. The request does not explain the basis for this. However, the issue of whether the variation is in the public interest is not something that must be demonstrated by the request and, in deciding whether this requirement is satisfied, I am entitled to have regard to the evidence about this which is contained in the joint expert report and the oral evidence.
The Council contends that the Applicant's cl 4.6 request does not demonstrate that compliance with the height development standard is unreasonable or unnecessary in the circumstances of the case. It also contends that the variation of the height development standard is not in the public interest because it says that the Proposed Development is not consistent with the objectives of the height development standard, or the objectives of the R3 zone. Specifically, the Council contends that the Proposed Development does not achieve objective (a) of cl 4.3 of the LEP to ensure that new development is in harmony with the bulk and scale of surrounding buildings and the streetscape "because its excessive height will be inconsistent with the scale of existing and desired future development within the streetscape". The Council also contends that the Proposed Development is not consistent with the objectives of the R3 Zone, set out in par [13] above.
The parties' town planning experts prepared a joint report dated 25 November 2021 (Ex 4) which addresses the Council's concerns in relation to the cl 4.6 request. The town planning experts agree, and I accept, that the Proposed Development is consistent with the objectives of the height development standard in cl 4.3 (other than objective (a)) and the objectives of Zone R3 Medium Density Residential (other than the fourth objective).
In relation to cl 4.3(1)(a), the Council's town planning expert, Mr Mark Bolduan, gave evidence (Ex 4, pars 48 to 50) that the strip of properties on the western side of Eastern Valley Way within the visual catchment of the Site was rezoned to R3 Medium Density Residential in 2012. His evidence is that land within that strip is in a state of transition from the low density development that has predominated historically to the medium density development contemplated by the rezoning. He says there are currently only two other residential flat buildings within the visual catchment of the Site, those being located at 50 Eastern Valley Way, and 52 - 54 Eastern Valley Way, both of which comply with the 12m height limit. In Mr Bolduan's opinion, the 1.39 m non-compliance with the height development standard will mean the Proposed Development would be "significantly higher than nearby buildings and will cause visual massing, when viewed from surrounding areas, which is inconsistent with both the existing and desired future streetscape". His evidence is that the Proposed Development does not respond adequately to the constraints of the Site caused by its sloping topography and that the Proposed Development "could comply with the height development standard if it stepped down the slope to the north, or removed Level 3".

[17]

Council's evidence

The Council's planning expert, Mr Bolduan gave evidence (Ex 4, pars (108) to (110)) that the R3 zone along Eastern Valley Way, of which the site forms a part, is in a state of transition from low density to medium density. He says that the only other residential flat building approved under the LEP in the visual catchment of the site (being the development at 52 - 54 Eastern Valley Way) has a front setback of 7.5m. The other residential flat building at 50 Eastern Valley Way has a front setback of approximately 11m. Existing dwelling houses in the zone have similar front setbacks which he says are well in excess of 7.5m.
Mr Bolduan's evidence is that the performance criteria in cl D.2.8.2 does not provide a right to vary the front setback, but simply enables the Council to 'consider' a variation. He points out that cl D2.8.2.1 allows variations 'where the streetscape will not be adversely affected, and an existing consistent pattern is not evident,' and says that the proposed breach of front setback fails both legs of this test. First, he says the streetscape "will be adversely affected by creating visual bulk which is inconsistent with the existing and desired future character of the streetscape". Second, his evidence is that there is an existing consistent pattern of front setbacks of at least 7.5m.
In oral evidence, Mr Bolduan accepted that there was some variation in the front setback of existing buildings in this location. However, he added that the variation was generally in setbacks that were greater than the 7.5 m referred to in the DCP (Transcript 2/12/21, p 6). Mr Bolduan agreed that the blade wall extensions would create 'variety' in the façade of the Proposed Development and would create shadow effects that will change during the day with the position of the sun (Transcript, 2/12/21, p 7). While he accepted that the blade wall extensions would create more visual interest than a flat façade, Mr Bolduan's evidence was that any such benefit "would be more than offset by the fact that it's coming close to the street and… creating more of a bulky effect in that front landscape" (Transcript 2/12/21, pp 6, 7).
Finally, Mr Bolduan says that the breaches of front setback involve built form at ground level which, in his opinion, is contrary to the intent of the front setback controls in Cl D2.8.1 'to provide adequate space for landscaping' (emphasis added).

[18]

Findings on overdevelopment

The Council does not contend that the non-compliance with the setback provisions of the DCP of itself would justify the refusal of the DA. Rather, it points to this non-compliance together with the breach of the height development standard and the site coverage provision of the DCP as leading to the conclusion that the bulk, and scale of the Proposed Development represents an overdevelopment of the Site. In this regard, having found that the height of the Proposed Development is acceptable and accepting the parties' experts agreement that the intent of the site coverage controls in the DCP have been met, the question becomes whether the non-compliance with the setback provisions of the DCP alone justifies a finding that the Proposed Development is an overdevelopment of the Site and ought not be approved.
I must approach the consideration of that question having regard to s 3.42 of the EPA Act, which provides that controls of the kind found in cll D.2.7.3 and D.2.8.2 are not statutory requirements and, in accordance with s 4.15(3A)(b), which provides that a consent authority must be flexible in applying these provisions of the DCP, and allow reasonable alternative solutions that achieve the objects of those standards for dealing with that aspect of the development.
I have concluded that the non-compliance by the Proposed Development with the front setback controls of the DCP does not justify a finding that the Proposed Development is an overdevelopment of the Site. In this regard, I accept Mr Gouge's evidence that the component of the Proposed Development that encroaches into the 7.5 m setback is limited to the blade wall extensions, parapets, and planter boxes. The front wall of the building itself generally complies with the 7.5 m setback. The incorporation of these architectural features will, in my assessment, add visual interest to the front façade of the Proposed Development consistently with performance criterion 1 of cl D.2.8.2 of the DCP, which as pointed out by Mr Gouge, expressly contemplates some variation to the front setback if used to create streetscape variety and interest. I find that the blade wall extensions will do just that.
In those circumstances I have concluded that the Proposed Development does not represent an overdevelopment of the Site because of its height, site coverage or front setback.

[19]

Urban design

The Council originally contended that the Proposed Development did not achieve the aims in cl 1.2(d) of the LEP to promote development that is designed and constructed:
(a) to enhance or integrate into the natural landform and the existing character of distinctive locations, neighbourhoods and streetscapes; and
(b) to contribute to the desired future character of the locality concerned.
The parties' urban design experts, Ms Gabrielle Morrish for the Applicant and Mr Wil Robertson for the Respondent conferred and prepared a joint expert report which became Ex 3 in the appeal. The urban design experts agree that, from an urban design viewpoint, there are no concerns with the architecture or built form, and that there is a good level of design quality in the Proposed Development, one that will improve on the existing benchmark for the area.
The urban design experts also agreed that the materials selected for the Proposed Development "could achieve a better response to the natural landscape context around it and the proximity to the bushland corridor". Their evidence is that: "- the white brick and white spandrel panels indicated on the materials board are too stark relative to the bushland setting and that a softer and more muted colour range that picks up on the colours and hues in the trunks of the adjacent gum trees would be more appropriate. - an amended materials board should be prepared and submitted that amends the brickwork to a brick similar in colour, tone and texture to Austral Masonry brick GB Veneer Arcadia - Desert Sunrise (relating to the warmer tones in the trees) and that the paint colour for the spandrels should be amended to a complimentary colour to the bricks similar to one of the colours indicated in the following swatches."
In oral evidence, the Applicant's urban design expert, Ms Morrish, elaborated on her concerns in relation to materials and finishes explaining (Transcript, 1/12/21 pp 15, 16) that the Site is located within a bushland setting with gums scattered throughout the bushland creek corridor. Her evidence was that the 'visual cues' for the Proposed Development should reflect this context with colours drawn from the natural landscape setting. On her evidence, doing so would "differentiate some of the articulation elements that are evident in the facades and… (help) to manage the mass in the building. Using the cream coloured bricks proposed by the Applicant would, in her view, result in the Proposed Development reading as a "monolithic mass".
A draft condition of consent (Ex 8, condition 2 (d)) requires the submission of an amended materials board for the approval of the Council's urban design officer prior to the issue of a construction certificate for the Proposed Development.
The Applicant does not agree with the views of the urban design experts (including the Applicant's own expert) and does not wish to submit an amended materials board. The Applicant submits that there is no control in the LEP or DCP that mandates the selection of the materials and colours as proposed by the urban designers. The Applicant points to the development at 52 to 54 Eastern Valley Way which it says is constructed of similar materials to those proposed by the Applicant and says that there is "no need… for buildings to be camouflaged into the landscape".
There is, as the Applicant submitted, an element of subjectivity in the selection of materials and finishes for the Proposed Development. Nevertheless, I accept the parties' urban design expert evidence that the white brick and white spandrel panels proposed by the Applicant are too stark in the context of the Site's bushland setting and that a better outcome will be achieved by the use of a softer and more muted colour range reflecting the colours in the trunks of the nearby gum trees. I have therefore concluded that a condition should be imposed requiring the submission of an amended materials board in accordance with the evidence of the parties' experts.

[20]

Flooding

The Council contends that the amended DA does not achieve the aim of cl 5.21 of the LEP to minimise the flood risk to life and property associated with the use of the Site.
The parties' expert witnesses on flooding, Rhys Mikhail for the Applicant and Joseph Bazergy for the Council, conferred and prepared a joint expert report (Ex 5). Attached to the joint expert report is a Flood Impact Risk Assessment and Report prepared by Mr Mikhail to address Mr Bazergy's concerns about the impact of flooding on the Proposed Development.
The Council's statement of facts and contentions (Ex 1) gave five particulars in relation to which it contended that the Proposed Development should be refused on flooding grounds. In their joint expert report, the parties' experts agreed that three of those particulars could be satisfactorily addressed by the imposition of conditions of consent. The remaining particulars are: "(a) Unit G01 has a finished floor level of RL 63.35, whereas in order to comply with the DCP requirement for 0.5m freeboard above 1% AEP flood level, it must have a finished floor level of RL 65.15. This is a breach of the DCP and clause 5.21 of the LEP. In order to address this, the proposal includes a flood wall for flood protection, which is not a preferable solution. The proposal should design the building floor levels by adapting to the existing topography for flood protection. In this regard, the finished floor level of the Ground Floor Units should be set above the flood planning level, removing the need for a flood wall. (b) The impact of the flood wall to the development site and to surrounding land and properties is to be assessed for the 1% AEP storm with 0.5m freeboard. The flood impact of the flood wall shall also be assessed in the revised flood study for storms in excess of the 1% AEP events and up to the PMF."
While much time was spent during the hearing in relation to the flooding issue, the areas of dispute between the parties following the preparation of the joint expert report are quite narrow.
The parties agree that the proposed finished floor levels of the Proposed Development can achieve the relevant Council minimum required freeboard levels except for the ground floor area adjacent to Unit G01. To achieve the Council minimum required freeboard of 500 mm at that location, the Applicant proposes to construct a 'flood wall' adjacent to that unit's courtyard area. A flood wall is not the Council's preferred solution and the Council's flood expert, Mr Bazergy, would prefer that the Proposed Development achieved the relevant freeboard without the necessity to rely on the flood wall. Mr Bazergy explained his objection to the flood wall in the following terms: "It's not normally good practice to excavate land that's above the flood level, reduce it to a level which is below the flood level and then rely on flood levy walls to protect it. To me, it's a band-aid solution which - where, you know, you're creating a hazard and then trying to solve it by a flood wall situation." (Transcript 1/12/21, p 42)
To achieve the required freeboard without the flood wall would require the ground floor units to be set above the flood planning level. The Applicant's flooding expert, Mr Mikhail, however, says this would be unreasonable, and maintains that a flood wall is an acceptable solution.
During the preparation of the joint expert report, and to address some of the Council's concerns, the Applicant's expert prepared a Flood Impact Risk Assessment Report (Flood Report) which became Annexure C to the joint expert report (Ex 5). This report informs the design of the Proposed Development and, in particular, its response to the Site's risk of flooding. Mr Mikhail, the Applicant's expert, gave oral evidence that, in his opinion, if the Proposed Development is constructed in accordance with his design, he would be prepared to certify that it was flood proof in both the 1% Annual Exceedance Probability (AEP) and Probable Maximum Flood (PMF) events.
Mr Bazergy, the Council's expert, did not accept the validity of the Flood Report. He said that the need for such a report was discussed in the joint expert conference and that he had understood that the Applicant was to provide a more detailed report and a more detailed model which could be assessed by the Council's flood engineers. In his view the Flood Report did not contain the level of information required.
Mr Bazergy gave evidence of his concerns about what he perceives to be uncertainty about the finished ground levels around the eastern edge of the flood wall. He says that Mr Mikhail is relying on existing contours which are slightly below the required freeboard and says that he is concerned that these may not be able to be maintained during construction and up until the completion of the development. This seems to be the principal area of dispute between the experts. While Mr Bazergy does not say that the flood modelling carried out by the Applicant is wrong, he says that he needs more detail beyond the finished ground levels to be able to have confidence in the design. His evidence is that, if the Proposed Development is to rely on the flood wall, it should be shown in its full extent to ensure the basement and excavated courtyard adjacent to Unit G01, which he says are below the flood level, are protected during flood events. Mr Bazergy says that the potential flooding risks mean that the full extent of the wall needs to be shown now, before the development is approved.
Mr Mikhail said the location of the proposed flood wall in the DA plans would provide adequate protection from flooding in the 1% event and in the PMF (Transcript 1/12/21, p 36) but said the location of the wall shown in the design was intended to be indicative saying that the "line may go this way a little bit, it might come this way a little bit." When asked specifically whether the full extent of the flood wall was shown in the DA plans, Mr Mikhail said that "the full extent of the minimum requirements" of the wall have been shown (Transcript 1/12/21, pp 41-42).
To address Mr Bazergy's concerns both in relation to the flood modelling and the proposed flood wall for Unit G01, the Council has proposed a deferred commencement condition (Ex 8, condition 1) which would require the submission of a revised flood report including all relevant rainfall data and tabulated flood levels for all storms including and up to the PMF event. The Applicant opposes the imposition of such a condition. While Mr Mikhail agreed that the provision of such a report would address the issues raised by Mr Bazergy, when asked whether he thought the condition was necessary, said: "We've already done the work. That condition would simply allow us to pad out a report more to provide the data, more of the results in a tabulated fashion, but we've essentially done the modelling and made the risk recommendations based on that modelling." (Transcript 1/12/21, p 43)
The Council's without prejudice conditions of consent also include a condition, condition 12, which covers similar ground. It provides that: 12. Overland Flow/Flood Level A suitably qualified and experienced civil engineer must certify that the finished floor levels of the proposed development have a minimum freeboard of 500mm above the 1% Annual Exceedance Probability (AEP) flood event, which is conveyed through the site, and that the basement carpark is protected from inundation for all storms including the 1% AEP plus 0.5m freeboard and up to the PMF, whichever is greater. The engineer must undertake an assessment of the critical flows as determined necessary to satisfy this condition. Where floor levels need to be raised or other flood protection measures are deemed necessary, details must be submitted and approved by the Certifier prior to the issue of the Construction Certificate. (Reason: Prevent property damage)
While the Applicant opposes the imposition of the proposed deferred commencement condition requiring the provision of a revised flood report, it does not oppose the imposition of condition 12. For its part, the Council says that the information required by condition 12 would go to the certifier tasked with the issue of a construction certificate, which may not be the Council, and insists that the revised flood report should be provided before any development consent becomes operative.
Clause 5.21(2) of the LEP provides that development consent must not be granted to development on land the consent authority considers to be within the flood planning area unless the consent authority is satisfied the development - (a) is compatible with the flood function and behaviour on the land, and (b) will not adversely affect flood behaviour in a way that results in detrimental increases in the potential flood affectation of other development or properties, and (c) will not adversely affect the safe occupation and efficient evacuation of people or exceed the capacity of existing evacuation routes for the surrounding area in the event of a flood, and (d) incorporates appropriate measures to manage risk to life in the event of a flood, and (e) will not adversely affect the environment or cause avoidable erosion, siltation, destruction of riparian vegetation or a reduction in the stability of river banks or watercourses.
In deciding whether to grant development consent on land to which cl 5.21 applies, cl 5.21(3) requires the consent authority to consider the following matters - (a) the impact of the development on projected changes to flood behaviour as a result of climate change, (b) the intended design and scale of buildings resulting from the development, (c) whether the development incorporates measures to minimise the risk to life and ensure the safe evacuation of people in the event of a flood, (d) the potential to modify, relocate or remove buildings resulting from development if the surrounding area is impacted by flooding or coastal erosion.
There is no dispute that the Site is within the flood planning area and that cl 5.21 applies.
I accept Mr Mikhail's evidence that the Proposed Development will not be adversely affected by flooding in either the 1% AEP or PMF events. While Mr Bazergy sought further information about the flood modelling carried out by the applicant, he did not establish any proper basis to doubt the accuracy of the modelling carried out by Mr Mikhail.
I also accept Mr Mikhail's evidence that the proposed flood wall is an acceptable means of addressing the potential flood risks associated with the Proposed Development. While Mr Bazergy would clearly prefer that the ground floor units were set above the flood planning level, I accept that doing so would require significant and, in my view unnecessary changes to the design of the Proposed Development.
I also accept Mr Mikhail's evidence that water entering the Site from the south will be overland flows from adjoining properties rather than from the flooding of the creek and will be "insignificant". I also accept his evidence that the final design of a flood wall of the kind proposed would generally not occur now, but later at the detailed design stage.
Having regard to the expert evidence on flooding, and after considering each of the matters referred to in cl 5.21(3), I am satisfied that: 1. the Proposed Development is compatible with the flood function and behaviour on the Site (as required by cl 5.21(2)(a)); 2. the Proposed Development will not adversely affect flood behaviour in a way that results in detrimental increases in the potential flood affectation of other development or properties (as required by cl 5.21(2)(b)); 3. the Proposed Development will not adversely affect the safe occupation and efficient evacuation of people or exceed the capacity of existing evacuation routes for the surrounding area in the event of a flood (as required by cl 5.21(2)(c)); 4. the occupants of the Proposed Development would not be subject to any risk to life in the event of a flood (as required by cl 5.21(d)); and 5. the Proposed Development will not adversely affect the environment or cause avoidable erosion, siltation, destruction of riparian vegetation or a reduction in the stability of river banks or watercourses (as required by cl 5.21(e).
I have decided that the proposed deferred commencement condition should not be imposed. While Mr Mikhail frankly conceded that some of the design drawings were "indicative" and showed only "the full extent of the minimum requirements" rather than the final design (see par [94] above), in my view the evidence is sufficient to demonstrate that the Proposed Development will not be adversely affected by flooding in either the 1% AEP or PMF events. Proposed condition 12 in the Council's without prejudice conditions of consent (Ex 8) will require certification prior to the issue of a construction certificate by a suitably qualified and experienced civil engineer that the finished floor levels of the proposed development achieve the required freeboard. In my view the imposition of condition 12 (which is accepted by the Applicant), will ensure that the final design of the Proposed Development is consistent with the modelling and predictions in the Flood Report. In the absence of any evidence from the Council's expert of any errors in the existing report, it would be inappropriate, in my view, to impose a deferred commencement condition simply to ensure that the updated flood information is provided to the Council rather than an accredited certifier.

[21]

Precedent

The Council raised a separate contention that the Proposed Development "does not achieve the intent of Section 1.3(c) (of the EPA Act) to promote the orderly and economic use and development of land." In this regard the Council argues that there are no unique features of the Site to justify the non-compliance of the Proposed Development with the development standards in the LEP relating to building height and setbacks.
The Applicant's planning expert, Mr Gouge, gave evidence that, in his opinion, the Proposed Development promotes the orderly and economic use of the Site through a design that he says appropriately responds to the circumstances of the Site, including both the constraints (such as flooding), and opportunities (such as the proximity of the Site to Sailors Bay Creek).
Mr Bolduan, the Council's planning expert, disagreed. In his view the existence of site constraints does not justify a breach of the building envelope controls applicable to the Site. Rather, he says that the Proposed Development should be adjusted in response to those constraints while still complying with the relevant standards and controls.
In submissions the focus of this contention changed somewhat and the Council ultimately submitted that the Proposed Development should not be approved because its exceedance of the height and setback controls would create a precedent for further breaches in relation to future development applications further along Eastern Valley Way.
In Goldin v Minister for Transport Administering the Ports Corporatisation and Waterways Management Act 1995 (2002) 121 LGERA 101; [2002] NSWLEC 75 at 110, Lloyd J explained the consideration of precedent in the flowing terms: "In Emmott v Ku-ring-gai Municipal Council, Sugerman J considered the proposition that a proposed development which is itself unobjectionable should not be allowed because it is likely to lead to other developments of a similar character, the totality of which would prove objectionable. His Honour went on to say that this is in turn dependent upon "a sufficient probability that there will be further applications for a number of undistinguishable developments of the same class sufficient in their totality to bring about the objectionable condition of affairs". As I understand the decision, if the Court is entertained with an application for a proposed development which is both objectionable in itself and where there is a sufficient probability that there will be further applications of a like kind, then the fact that a consent would operate as a precedent may be taken into consideration."
I note that the reference in the final sentence of the quoted paragraph to 'objectionable in itself' is, in the context of the paragraph and the earlier observations made by his Honour in the same case, clearly in error and should read 'unobjectionable in itself'.
In the present case I have found that the exceedance of the height development standard and the non-compliance with the setback controls are acceptable for the reasons set out earlier in this judgment. I find that the Proposed Development is, for those reasons, "unobjectionable in itself". Other than the fact that there is other land in Eastern Valley way that is also within Zone R3, there is no evidence before the Court to suggest that there is any probability of further applications being made that also propose departures from the height and setback controls. The topography of the Site and its proximity to Sailors Bay Creek are features that, from my observation during the site inspection, are unlikely to be repeated on other sites within the zone. In those circumstances, I do not accept that the approval of this DA will create any precedent for departures from the height or setback controls in future development applications. Future development applications will be assessed on their own merits and the approval of this DA will not, in my view, provide any justification for the relaxation of the height or setback controls elsewhere within the zone.

[22]

Conditions

The parties have provided competing sets of without prejudice conditions. The Council's proposed conditions are contained in Ex 8 and the Applicant's proposed conditions are contained in Ex J.
The Council has proposed four deferred commencement conditions which it says should be satisfied before any development consent becomes operative. I have already rejected proposed deferred commencement condition 1, which would require the provision of a revised flood study (see par [104] above).
Proposed deferred commencement conditions 2 (revised architectural and landscaping plans) and 3 (revised stormwater management plans) are objected to by the Applicant but only on the basis that they should be imposed, not as deferred commencement conditions, but as conditions requiring compliance prior to the issue of a construction certificate. The only justification proffered by the Council for the imposition of the conditions as deferred commencement conditions, is that this would enable the information to be received and reviewed by the Council rather than an accredited certifier. In my view, that is not a proper or sufficient basis for the imposition of the conditions as deferred commencement conditions, and I have decided that the conditions should be imposed, not as deferred commencement conditions, but as conditions requiring compliance prior to the issue of a construction certificate.
Proposed deferred commencement condition 4 requires the submission of detailed driveway longitudinal sections. The Applicant opposes the imposition of this condition and says that this condition is unnecessary in the light of proposed condition 16 (which requires the submission of driveway longitudinal sections prior to the issue of a construction certificate). The Council says that the longitudinal sections and layout of the vehicular crossings need to satisfy the requirements of both the Council and Transport New South Wales. On this basis the Council argues the longitudinal sections should be provided to the Council before the consent becomes operative. It also says that this condition is required to address the agreement of the traffic engineers in their joint expert report (Ex 7).
The traffic experts agreed in their joint expert report that the Council's contention that the internal driveway is required to have a crest point with a reduced level 0.5 m above the 1% AEP overland flood level. This, in my view, is a matter of engineering design that is adequately addressed by proposed condition 16. I do not accept that it is a requirement that is appropriately imposed as a deferred commencement condition simply to ensure the information is given to the Council rather than an accredited certifier. To the extent that the Council will be involved in the approval of the driveway crossing in the exercise of its functions under the Roads Act 1993, it will still be able to seek whatever information it says is necessary for that purpose despite the absence of the deferred commencement condition proposed by the Council.

[23]

Affordable Housing Monetary Condition

There was a major dispute between the parties in relation to the inclusion of a condition requiring the Applicant to pay a monetary contribution for the provision of affordable housing. This was condition 27 in the Council's without prejudice conditions (Ex 8).
The Applicant had initially offered to make such a contribution in the amount of $451,000 (based on 4% of the GFA of the Proposed Development) (Ex A, Tab 5, p 23). However, the Applicant says that this was only because the GFA of the Proposed Development initially exceeded that permitted by the LEP and was in accordance with the 'bonus' floor space provisions in the LEP. Amendments made to the DA prior to the hearing resulted in a reduction of the GFA below that permitted by the LEP as the result of which the Applicant has withdrawn its original offer.
The Council contends that a contribution for affordable housing is both lawful and reasonable in the circumstances of the case.
The issue did not arise until the parties were in final submissions on the second day of the hearing. Each party then filed additional expert evidence and written submissions and the matter came back before me for further hearing on 22 February 2022.
The condition proposed by the Council is as follows: 27. Affordable Housing Monetary Contribution The applicant shall make a monetary contribution for the purpose of providing Affordable Housing that is calculated at 4% of the accountable total floor area of the development to Council. In calculating the monetary contribution reference is to be made to the market value of dwellings of a similar size and taken from the most recent median sales price of such dwellings for the Willoughby local government area as documented in the Rent and Sales Report NSW published by Housing NSW or, if another document has been approved for that purpose by the Director - General, that document. Prior to payment of the contribution evidence shall be submitted to Council's Director of Planning & Infrastructure demonstrating how the contribution has been calculated in accordance with the above requirement. The contribution is to be paid prior to release of the construction certificate. (Reason: Ensure compliance)
There are a number of statutory provisions that are relevant both to whether the proposed condition can lawfully be imposed and if so, whether it should be imposed.

[24]

Provisions in the EPA Act

Section 7.32(1) of the EPA Act applies to a development application for consent to carry out development within an area if a State environmental planning policy identifies that there is a need for affordable housing within the area.
Section 7.32(1) then goes on to provide that the section applies if: (a) the consent authority is satisfied that the proposed development will or is likely to reduce the availability of affordable housing within the area, or (b) the consent authority is satisfied that the proposed development will create a need for affordable housing within the area, or (c) the proposed development is allowed only because of the initial zoning of a site, or the rezoning of a site, or (d) the regulations provide for this section to apply to the application.
The parties agree that the Proposed Development is allowed only because of the zoning of the Site as R3 - Medium Density Residential under the LEP and consequently that s 7.32(1)(c) applies.
Section 7.32(2) of the EPA Act provides that, subject to s 7.32(3), the consent authority may grant consent to a development application to which the section applies subject to a condition requiring: (a) the dedication of part of the land, or other land of the applicant, free of cost to be used for the purpose of providing affordable housing, or (b) the payment of a monetary contribution to be used for the purpose of providing affordable housing, or both.
Section 7.32(3) provides that a condition may be imposed under s 7.32(2) only if: (a) the condition complies with all relevant requirements made by a State environmental planning policy with respect to the imposition of conditions under this section, and (b) the condition is authorised to be imposed by a local environmental plan, and is in accordance with a scheme for dedications or contributions set out in or adopted by such a plan, and (c) the condition requires a reasonable dedication or contribution, having regard to the following - (i) the extent of the need in the area for affordable housing, (ii) the scale of the proposed development, (iii) any other dedication or contribution required to be made by the applicant under this section or section 7.11.

[28]

Expert evidence on affordable housing

The Council's planning expert, Mr Bolduan, prepared an expert report addressing the proposed condition which was filed on 22 December 2021 (Ex 9). His evidence is that cl 6.8(2)(a) of the LEP requires consideration of the Willoughby Affordable Housing Principles but that the DA "does nothing to provide affordable housing or to promote, advance, and achieve the Principles unless the Applicant pays a monetary contribution (as set out in draft Condition 27), because the Applicant seeks to develop a site within Area 3 but does not propose to include any affordable housing at all as part of the proposed development" (Ex 9, par (15)). The payment of a monetary contribution would, on Mr Bolduan's evidence, help promote, advance and achieve the purposes of the Principles by contributing money that would be used by the Council for the purpose of providing, improving or replacing affordable housing within its area. In this regard, there is no dispute between the parties that various studies have identified an existing need for affordable housing within the Willoughby local government area, a need which dates back to well before the commencement of the LEP in 2013.
Mr Bolduan says that cl 6.8(3)(b) of the LEP provides that an affordable housing condition may include a condition requiring the payment of a monetary contribution that is the value of 4% of the accountable total floor space. He says that contributions of this amount have been applied within the Willoughby local government area since 1999 and have been imposed on several approvals for residential development given under the LEP. In oral evidence, Mr Bolduan agreed that the Proposed Development would have no impact on the existing mix of housing stock but insists that the Proposed Development will have an impact on the future mix as, without a monetary contribution, it will reduce the funds available to the Council to provide affordable housing in its area.
The Applicant relies on an expert report prepared by its planning expert, Stephen Gouge, filed on 28 January 2022 (Ex G). Mr Gouge does not dispute that there is an identified need for affordable rental housing in the Willoughby local government area but says that this need already exists and does not relate to, and has no apparent nexus with, the Proposed Development. His evidence (Ex G, par (11)) is that the Willoughby City Housing Strategy (Housing Strategy), using 2016 census data, identifies a total of 29,993 dwellings in the local government area comprising 13,356 dwelling houses, 4,210 medium density dwellings, 12,261 high density dwellings and a small number of other dwelling types. The Proposed Development will replace two existing dwelling houses with 11 new apartments which, he says, will result in a negligible change in the existing mix of residential housing in the area.
The Housing Strategy also indicates that between 1999 and 2005 a total of 10 affordable housing units were provided and, to May 2020, and 35 affordable housing units had been provided for key workers (Ex G, p 401). The Housing Strategy also states that the Council is committed to increasing the number of Council provided affordable housing properties from 22 to 50 by 2023 and to 70 by 2026.
In relation to the affordable housing contributions imposed on other development consents, Mr Gouge says that these were either proposed (or not objected to) by the proponents of those developments or were paid in exchange for additional floor space under the LEP.
Mr Bolduan prepared a further export report in reply which was filed on 18 February 2022 (Ex 10). His evidence (Ex 10, par 6) is that, whether or not the Proposed Development contributes to the need for affordable housing (he says that it does but does not explain how), "it is undeniable that, in the absence of any monetary contribution being paid by the developer: a. the application does nothing to promote, advance and achieve the Principles; b. the application does nothing to provide any affordable housing to the existing mix of residential housing stock in Willoughby; and c. the application is likely to reduce the provision of affordable housing in the future mix of residential housing stock in Willoughby, because it would result in the development of two rezoned sites without the provision of any affordable housing, which necessarily means that there are two fewer sites in the future which could possibly provide affordable housing in the Willoughby LGA."
Mr Bolduan's evidence is that cl 6.8 of the LEP is intended to address the existing deficiency in the availability of affordable rental housing and that all residential development in Area 3 should make a contribution equivalent to 4% of the accountable total floor space regardless of the impact the carrying out of the development has on the availability of affordable housing.

[29]

Council's submissions on affordable housing condition

The Council submits that the Applicant itself initially proposed the payment of an affordable housing contribution of a similar amount to that required to be paid by the proposed condition and says that the Applicant should not be allowed to resile from that position. It also says that similar conditions have been imposed on the grant of development consent to other development applications.
The Council submits that the proposed condition satisfies all of the relevant preconditions in the EPA Act, SEPP 70, and the LEP, that in terms of a nexus between the Proposed Development and the proposed condition, it is to be seen as the quid pro quo for the rezoning of the Site; the developer obtains a financial advantage as the result of the rezoning and it is therefore reasonable for the developer to pay a monetary contribution for affordable housing. In that sense, the Council submits that the proposed condition fairly and reasonably relates to the Proposed Development and is a condition that is reasonable given the benefit derived by the Applicant from the rezoning of the Site to allow the development to be carried out. The Council also submits that unless a condition is imposed requiring the payment of a monetary contribution, as the DA does not propose the provision of any affordable housing as part of the Proposed Development, there will be no affordable housing provided contrary to the aims of the relevant statutory provisions.
The Council also argues that there is no case that stands as authority for the proposition that a condition requiring an affordable housing contribution must satisfy what has become known as the Newbury test. The Newbury test derives from the decision of the House of Lords in Newbury District Council v Secretary of State for the Environment [1981] AC 578 and was restated by McHugh J in Western Australian Planning Commission v Temwood Holdings Pty Ltd (2004) 221 CLR 30; 137 LGERA 232, at [57], as: "A condition attached to a grant of planning permission will not be valid therefore unless: 1. The condition is for a planning purpose and not for any ulterior purpose. A planning purpose is one that implements a planning policy whose scope is ascertained by reference to the legislation that confers planning functions on the authority, not by reference to some preconceived general notion of what constitutes planning. 2. The condition reasonably and fairly relates to the development permitted. 3. The condition is not so unreasonable that no reasonable planning authority could have imposed it."

[31]

Findings on affordable housing contribution

I am satisfied that s 7.32 of the EPA Act applies to the DA. As noted above at par [129], SEPP 70 identifies that there is a need for affordable housing within each area of the State. I am also satisfied that the Proposed Development is allowed only because the Site was rezoned by the LEP to R3 - Medium Density Residential, thus satisfying the requirements of s 7.32(1)(c) of the EPA Act.
In relation to s 7.32(3), I am satisfied that, if the proposed condition was authorised by the LEP, the proposed condition would comply with all relevant requirements made by SEPP 70 with respect to the imposition of the proposed condition. Clause 10 of SEPP 70 requires me to have regard to the affordable housing principles set out in Sch 2 of SEPP 70 before an affordable housing condition is imposed and housing principle 1 provides that, where any of the circumstances described in s 7.32(1)(a), (b), (c) or (d) of the EPA Act occurs and a State environmental planning policy or local environmental plan authorises an affordable housing condition to be imposed, such a condition "should be imposed" so that mixed and balanced communities are created.
Before imposing the proposed condition, I must be satisfied that the condition is authorised to be imposed by the LEP (s 7.32(3)(b) and housing principle 1 in Sch 2 of SEPP 70)) and that the condition requires a reasonable dedication or contribution, having regard to the extent of the need in the area for affordable housing (s 7.32(3)(c)(i)), the scale of the proposed development (s 7.32(3)(c)(ii)) and any other dedication or contribution required to be made by the Applicant under ss 7.32 or 7.11 (s 7.32(3)(c)(iii)).
As the Site is within Area 3 on the Special Provisions Area Map in the LEP, cl 6.8(2) of the LEP provides that development consent must not be granted to the DA unless I have taken the following into consideration - (a) the Willoughby Affordable Housing Principles, (b) the impact the development would have on the existing mix and likely future mix of residential housing stock in Willoughby, (c) whether one of the affordable housing conditions should be imposed on the consent for the purpose of providing affordable housing in accordance with the Willoughby Affordable Housing Principles.
I have set out the Willoughby Affordable Housing Principles at par [133] above. With the exception of principle (a), it seems to me that the principles relate to the management of affordable housing and are not directly relevant to the issue of whether a condition should be imposed requiring the provision of affordable housing. Principle (a) is that "affordable housing must be provided and managed in Willoughby so that accommodation for a diverse residential population representative of all income groups is available in Willoughby". While principle (a) refers to both the provision and management of affordable housing, it does so in broad terms for the purpose of explaining the benefits of providing and managing affordable housing. It does not specify who is to provide such housing, where it is to be provided or how it is to be provided. While I have taken all of the Willoughby Housing Principles into consideration, I do not read principle (a) as providing any more than high level general support for the provision of affordable housing when appropriate.
In relation to cl 6.8(2)(b), there was some debate between the parties as to whether the reference to "the existing mix and likely future mix of residential housing stock" means the mix of different types of residential development (e.g. dwelling houses, medium density dwellings, and apartments) or the mix of affordable housing and other housing. Given its context within a provision concerned with the provision of affordable housing, in my view, the mix referred to in cl 6.8(2)(b) of the LEP is the mix of affordable and other types of housing.
Reading cl 6.8(2)(b) in this way, I agree with the Applicant that there is no evidence before the Court that the Proposed Development will have any discernible impact on the mix of affordable and other housing in the Willoughby local government area. Mr Bolduan's evidence that the application is likely to reduce the provision of affordable housing "because it would result in the development of two rezoned sites without the provision of any affordable housing" seems merely to be saying that the Council would be able to provide more affordable housing if the Applicant was required to pay an affordable housing contribution. That proposition is self-evident but not to the point - it does not assist the Court in considering, as cl 6.8(2)(b) requires, the impact of the Proposed Development on the mix of affordable and other housing in the Council's area.
Unfortunately, the expert evidence led by the Council does not clearly describe the current or future mix of affordable and other housing in the Willoughby local government area. It is readily apparent, however, that if the total number of dwellings in the Council's area is in the order of 30,000 (29,993 as at 2016 - see par [136] above) and the number of Council provided affordable housing units was 22 in 2020 (with plans to increase that number to 50 by 2023, and 70 by 2026) (see par [137] above), replacing 2 existing dwellings with 11 apartments (as proposed by this DA) will have no material impact on the mix of affordable and other housing in the Council's area. The fact that not requiring the Applicant to pay an affordable housing contribution to the Council will mean that the Council has less funds to expend on the provision of additional affordable housing does not change that conclusion.
I do not accept the Council's submission that the Newbury test does not apply to the imposition of a condition under s 7.32 of the Act. Section 4.17 of the EPA Act deals with the imposition of conditions. Section 4.17(1)(h) provides that a condition may be imposed if "it is authorised to be imposed under section 4.16(3) or (5), subsections (5)-(9) of this section or section 7.11, 7.12, 7.24 or 7.32."
I note that s 7.12, which deals with fixed development consent levies directly addresses the second limb of the Newbury test by providing in subs (4) that a condition imposed under that section "is not invalid by reason only that there is no connection between the development the subject of the development consent and the object of expenditure of any money required to be paid by the condition." There is no equivalent provision in s 7.32.
I also note that conditions imposed under s 7.11 (and its predecessor, s 94) have been held to be subject to the Newbury test for validity. For example in Lake Macquarie City Council v Hammersmith Management Pty Ltd (2003) 132 LGERA 225; [2003] NSWCA 313 Tobias JA said, at [52]: "In my opinion, a condition can only be validly imposed pursuant to s 94(1) if: (a) one or other of the limbs of the statutory phrase is satisfied; (b) the condition satisfies the Newbury test of being: (i) for a planning purpose; (ii) fairly and reasonably relating to the development; and (iii) not being so unreasonable that no authority would have imposed it."
Given the grouping of conditions than can be imposed under ss 7.11 and 7.32 in s 4.17 of the EPA Act, there is no justification, in my opinion, for requiring conditions under s 7.11 to comply with the Newbury test but not conditions under s 7.32. Had it been intended that an affordable housing condition could be imposed without the need to consider whether the condition fairly and reasonably relates to the development the subject of the development application, it would have been a simple matter for this to have been expressed in the section (as it has been for s 7.12).
I am reinforced in coming to this conclusion by the provisions of s 7.32(3)(c) of the EPA Act which provides that an affordable housing condition may only be imposed to require a reasonable dedication or contribution. The imposition of an affordable housing condition where the proposed development has no impact on the existing or future mix of affordable, and other housing could not, in my view, be said to require a reasonable dedication or contribution. This is more so, in my view, when the amount of the contribution payable is fixed at 4% of the accountable total floor space of the development, regardless of the impact of the development on the existing, or future mix of residential housing stock in Willoughby.
Similarly, cl 6.8(2)(c) of the LEP requires consideration of whether one of the affordable housing conditions should be imposed (emphasis added). Clause 6.8 does not mandate the imposition of an affordable housing condition on every consent for erection of residential accommodation on land identified as "Area 3". The discretion conferred by cl 6.8(2)(c) is in my view, inconsistent with Mr Bolduan's evidence that cl 6.8 of the LEP was intended to address the existing deficiency in the availability of affordable rental housing and that all residential development in Area 3 should therefore be approved subject to an affordable housing condition.
While the Council referred to several other authorities, in my view these do not take the matter any further. The decision of Craig J in Cavasinni Constructions Pty Ltd v Fairfield City Council (2010) 173 LGERA 456; [2010] NSWLEC 65, for example, merely confirms the importance of starting with a consideration of the relevant statutory provisions before applying the Newbury test. As his Honour said (at [21]): "When addressing the validity of a condition, attention must first be given to the statutory provision which is the source of power to impose conditions before turning to a consideration of judicial exegesis of provisions which are not, in terms, those that inform the power being considered (Walker Corporation Pty Limited v Sydney Harbour Foreshore Authority [2008] HCA 5 at [29] - [35]; 233 CLR 259)."
His Honour did not, however, hold that the Newbury test did not apply, saying at [26]: "In my opinion full effect can be given both to the statutory provision and to the Newbury tests if subsection (1)(a) of s 80A is considered as if it read: "A condition of development consent may be imposed if it fairly and reasonably relates to any matter referred to in s 79C(1) of relevance to the development the subject of the consent." Thus, the condition under challenge must be shown to be both fair and reasonable as it relates to a matter identified in s 79C(1). It must also be shown to be "of relevance" to the development the subject of the consent."
As stated above, in my view, there is no evidence that the Proposed Development will have any material impact on the mix of affordable, and other housing in the Council's area. It will not remove any existing affordable housing and will add only an additional nine "other" housing units to the approximately 30,000 that already exist. In my view, for the proposed condition to fairly and reasonably relate to the Proposed Development would require a finding, in accordance with cl 6.8(2)(b) of the LEP, that the Proposed Development will have a material impact on the existing or likely future mix of residential housing stock in the Willoughby local government area. It is not enough that the DA simply proposes residential development that is permitted as the result of the making of the LEP. For the reasons given above I cannot make such a finding on the evidence before the Court.
In those circumstances, I have concluded that the proposed condition is not one that is authorised by the LEP. As s 7.32(3) of the EPA Act provides that a condition may be imposed under s 7.32(2) only if, amongst other things, the condition is authorised to be imposed by a local environmental plan, it necessarily follows that the condition cannot be lawfully imposed.
That conclusion also means that it is not relevant that the Applicant initially proposed the making of an affordable housing contribution, or that the Council has imposed such a requirement on other developers.

Blanc Black Projects Pty Limited v Willoughby City Council

At a glance

Court

Decision date

Catchwords

Source

Catchwords

Judgment (34 paragraphs)

Parties

Cases Cited (8)

Cited By (4)