Botany Bay City Council v Minister for Planning and Infrastructure & Ors

Judgment

1. The Applicant in these proceedings, Botany Bay City Council (the "Council'), challenges an approval granted by the Planning Assessment Commission (the "PAC") on 19 September 2013 to a mixed use development on the current site of the Eastlakes Shopping Centre (the "Approval" and the "Project" respectively).
2. The Approval was purportedly granted by the PAC under s 75J(I) of former Part 3A of the Environmental Planning and Assessment Act 1979 (NSW) ("Part 3A" and the "EPAA" respectively). In granting the Approval the PAC was acting as the delegate of the First Respondent to these proceedings, the Minister for Planning and Infrastructure (the "Minister"). The Second to Fifth Respondents are the various corporate entities pursuing the Project (the "proponents").
3. These proceedings fall within Class 4 of the Court's jurisdiction (Land and Environment Court Act 1979 (NSW), s 20); that is they are in the nature of judicial review of the legal validity of the Approval. They are not concerned with the merits of the Approval except to the extent that they may reflect upon its validity.
4. Consistent with that constraint, in its Amended Points of Claim (the "APOC"), the Council pleaded five claims, each of which is said to lead to a conclusion that the Approval is invalid. Some of those claims have a number of permutations. In the balance of this judgment I address and reject each of those claims and their various permutations. However it must be emphasised that in doing so this Court is not assessing the merits of the Project or the Approval. In particular this Court cannot consider, and accordingly has not addressed, the Council's fundamental complaint about the Project which was set out in its letter dated 18 September 2012 to the Department of Planning (the "Department") as follows: "But our central complaint is the fact that the project does not meet the standards of quality design and amenity that the Council has been pursuing for a quarter of a century. It is repugnant to everything Council has been striving to achieve over those years. It is a "throw back" to the bad old days. If this project is approved in its present form it will send a message that the standards of development that the Council has insisted upon need no longer be adhered to. It will significantly set back the standards for the redevelopment of Eastlakes that the Council has been encouraging and the community has been expecting. How can we achieve our vision for the City of Botany Bay through quality redevelopment if this project is approved?"
5. The balance of this judgment outlines the operation of Part 3A, describes the Project and the background leading to the Approval and then addresses each of the Council's claims.

Part 3A of the EPAA

1. Part 3A was inserted into the EPAA with effect from 1 August 2005 by the Environmental Planning and Assessment Amendment (Infrastructure and Other Planning Reform) Act 2005 (NSW). It was repealed with effect from 1 October 2011 by the Environmental Planning and Assessment Amendment (Part 3A Repeal) Act 2011 (NSW);(clause 1.1 of Schedule 1 (No 22 of 2011)). However clause 3(1) of Schedule 6A to the EPAA provides that Part 3A continues to apply to and in respect of a "transitional Part 3A project". The parties accepted that the Project was a transitional Part 3A project because the relevant environmental assessment requirements were notified within two years before Part 3A was repealed (Schedule 6A; clause 2(1)(c)).
2. The relevant form of Part 3A is that which was in force immediately prior to its repeal subject to various provisions of Schedule 6A to the EPAA. Of those provisions the only ones of present relevance are clauses 3D and 2A, the effect of which is noted below.
3. Part 3A created a separate regime for development approval in respect of, inter alia, developments that were considered to be major infrastructure or otherwise of "State or regional environmental planning significance" (s 75B(2)). Subsection 75B(1) provided that the Part applied to the carrying out of development that is declared to be a "project" to which the part applies either by a State environment planning policy or by an order of the Minister published in the Gazette.
4. Division 2 of Part 3A concerned the environmental assessment and approval of such projects. Subsection 75D(1) precluded the carrying out of development under a project unless the Minister approved it being carried out. Subsection 75D(2) obliged the person carrying out the project to comply with any conditions to which the project was subject.
5. Subsection 75E(1) enabled a "proponent" to apply for approval to carry out a project. Section 75F provided: "75F Environmental assessment requirements for approval (1) The Minister may, after consultation with the Minister for the Environment, publish guidelines in the Gazette with respect to environmental assessment requirements for the purpose of the Minister approving projects under this Part (including levels of assessment and the public authorities and others to be consulted). (2) When an application is made for the Minister's approval for a project, the Director-General is to prepare environmental assessment requirements having regard to any such relevant guidelines in respect of the project. (3) The Director-General is to notify the proponent of the environmental assessment requirements. The Director-General may modify those requirements by further notice to the proponent. (4) In preparing the environmental assessment requirements, the Director-General is to 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 environmental assessment requirements may require an environmental assessment to be prepared by or on behalf of the proponent in the form approved by the Director-General. (6) The Director-General may require the proponent to include in an environmental assessment a statement of the commitments the proponent is prepared to make for environmental management and mitigation measures on the site. (7) This section is subject to section 75P."
6. Subsection 75H(1) required a proponent to submit to the Director-General the environmental assessment "required under this Division for approval to carry out the project". Subsection 75H(2) enabled the Director-General to require a proponent to submit a revised environmental assessment. Subsections 75H(3) to (5) made provision for making the assessments publicly available and the receipt of submissions in response. Subsection 75H(6) empowered the Director-General to require a proponent to submit a response to the issues raised in the submissions, a "Preferred Project Report" outlining any proposed changes to the project to minimise its environmental impact, and any revised statement of commitments.
7. Sections 75I and 75J provided: "75I Director-General's environmental assessment report (1) The Director-General is to give a report on a project to the Minister for the purposes of the Minister's consideration of the application for approval to carry out the project. (2) The Director-General's report is to include: (a) a copy of the proponent's environmental assessment and any preferred project report, and (b) any advice provided by public authorities on the project, and (c) a copy of any report of the Planning Assessment Commission in respect of the project, and (d) a copy of or reference to the provisions of any State Environmental Planning Policy that substantially govern the carrying out of the project, and (e) except in the case of a critical infrastructure project - a copy of or reference to the provisions of any environmental planning instrument that would (but for this Part) substantially govern the carrying out of the project and that have been taken into consideration in the environmental assessment of the project under this Division, and (f) any environmental assessment undertaken by the Director-General or other matter the Director-General considers appropriate, and (g) a statement relating to compliance with the environmental assessment requirements under this Division with respect to the project. 75J Giving of approval by Minister to carry out project (1) If: (a) the proponent makes an application for the approval of the Minister under this Part to carry out a project, and (b) the Director-General has given his or her report on the project to the Minister, the Minister may approve or disapprove of the carrying out of the project. (2) The Minister, when deciding whether or not to approve the carrying out of a project, is to consider: (a) the Director-General-General's report on the project and the reports, advice and recommendations (and the statement relating to compliance with environmental assessment requirements) contained in the report, and (b) if the proponent is a public authority - any advice provided by the Minister having portfolio responsibility for the proponent, and (c) any findings or recommendations of the Planning Assessment Commission following a review in respect of the project. (3) In deciding whether or not to approve the carrying out of a project, the Minister may (but is not required to) take into account the provisions of any environmental planning instrument that would not (because of section 75R) apply to the project if approved. However, the regulations may preclude approval for the carrying out of a class of project (other than a critical infrastructure project) that such an instrument would otherwise prohibit. (4) A project may be approved under this Part with such modifications of the project or on such conditions as the Minister may determine. (5) The conditions of approval for the carrying out of a project may require the proponent to comply with any obligations in a statement of commitments made by the proponent (including by entering into a planning agreement referred to in section 93F)."(emphasis added)
8. The application of these provisions to transitional Part 3A projects such as the Project, the subject of these proceedings, was modified by clause 3D of Schedule 6A to the EPAA which provided: "3D Modification of environmental assessment provisions-sections 75H and 75I For the purposes of the application of Part 3A to a transitional Part 3A project: (a) section 75H (3) is taken not to require the Secretary to accept an environmental assessment before making an environmental assessment publicly available in accordance with that subsection, and (b) section 75I (2) (g) does not apply to or in respect of a transitional Part 3A project, and (c) the Minister is not required to consider a statement relating to compliance with environmental assessment requirements for the purposes of section 75J (2) (a) or 75O (2) (a)."
9. Further, on 14 May 2014 Schedule 6A to the EPAA was amended by the inclusion of clause 2A which provided: "Public Interest Consideration for Part 3A projects 2A (1) To avoid doubt, it is declared that the Minister is authorised (and is taken always to have been authorised) to take the public interest into account when deciding whether or not to approve the carrying out of a project or to give approval for a concept plan under Part 3A, before or after the repeal of that Part. (2) It does not matter whether the Director-General's report on the project did or did not give consideration to or make any recommendation about the public interest or any particular aspect of the public interest."
10. In addition, Regulation 8B of the Environmental Planning and Assessment Regulation 2000 (NSW) provided: "8B Matters for environmental assessment and Ministerial consideration The Director-General's report under section 75I of the Act in relation to a project is to include the following matters (to the extent that those matters are not otherwise included in that report in accordance with the requirements of that section): (a) an assessment of the environmental impact of the project, (b) any aspect of the public interest that the Director-General considers relevant to the project, (c) the suitability of the site for the project, (d) copies of submissions received by the Director-General in connection with public consultation under section 75H or a summary of the issues raised in those submissions."
11. Section 75L enabled appeals by an "objector" to this Court against a decision by the Minister to give approval to carry out a project. However it was common ground that it had no application to the Approval (presumably because the Project was the subject of review by the PAC: see s 75L(1)(c)).
12. Division 3 of Part 3A concerned "Concept Plan[s]" and need not be discussed further. Division 4 addressed the effect of other provisions of the EPAA and other legislation on the carrying out of approved projects. Subsection 75R(1) excluded the operation of Parts 4 and 5 of the EPAA to an approved project and s 75R(2) limited the operation of State environmental planning policies to projects to which Part 3A applied. Section 75U exempted approved projects from the need to seek various approvals under other legislation and s 75V modified the power to refuse authorisations for approved projects under certain legislation. Division 5 included s 75W which enabled the Minister to modify any approval given to a project.

The Project and the Approval

1. Some parameters of the Project have changed over time but its basic features have not altered. The following is taken from the "Project Summary" set out in the Environmental Assessment Report (the "EAR") noted in [27]. The Project area comprises two sites on either side of Evans Avenue, Eastlakes. The northern site spans the southern side of Gardeners Road to the north of Evans Avenue. It is bounded on the western side by Racecourse Place. It appears to be presently used by a number of retail shops facing Gardeners Road. There is a large car park to the rear of those shops. The southern site is the site of the Eastlakes Shopping Centre. It is bounded on its western side by Eastlakes reserve and on the eastern side and southern end by Barbers Avenue. St Helena Parade intersects with Barbers Avenue along the southern edge of the southern site.
2. The Project is principally comprised of a ground floor development of approximately 12,450 m2 of net retail floor space, 2 levels of basements car parking for approximately 900 to 1000 vehicles, approximately 360 residential apartments in buildings constructed between 2 to 6 storeys above retail level and 80 serviced apartments. The Project also includes associated site preparation works, signage zones, landscaping, stormwater design, alterations to vehicle access points and road works. It is envisaged that the Project would be completed in two stages; Stage 1 comprising the basement, retail and residential components of the northern site and Stage 2 being the southern site.
3. To address the Council's case it is necessary to set out the events that lead to the granting of the Approval with particular reference to four issues namely: the possible extinguishment of Council's easements during the completion of Stage 2, the PAC's approach to groundwater run off especially the Council's contention that the proponents should have, but did not, provide to the PAC a so called "overland flow path analysis", the size of the residential apartments to be built as part of the Project and the Council's suggestion that a link road be built between Racecourse Place and St Helena Parade as part of Stage 2.
4. On 17 July 2009 JBA Urban Planning Consultants wrote to the Director-General of the Department of Planning (the "Director-General"). In their letter they stated they were writing on behalf of what was known as the "Eastlakes Joint Venture"; i.e. the proponents. They requested the Minister make a declaration under Part 3A in respect of the project referred to in their letter. In context the letter amounted to a request that the Minister make a declaration under former s 75B(1)(b) of the EPAA.
5. The letter described the Project in similar terms to that noted above. The letter also requested the Minister allow the proponents to pursue a concept plan under Division 3 of Part 3A.
6. On 31 August 2010 the Director-General requested the PAC review the request. On 17 September 2010 the PAC responded. On 17 January 2011 the Minister endorsed a recommendation that the Project be declared under s 75B(1) of the EPAA, but declined to authorise the application for approval of a concept plan under s 75M(1). It is not disputed that it was so declared.

Environmental Assessment Requirements

1. On 5 April 2011 the Director-General issued environmental assessment requirements for the Project pursuant to s 75F(3) of the EPAA. The requirements assumed that an Environmental Assessment Report would be lodged (s 75F(5)). They also included a "key issue 13" which required the proponents to address drainage and groundwater issues. The proponents were also required to "address the design principles of SEPP 65 and the Residential Flat Design Code with particular reference to unit sizes". The requirements specified the plans and other documents that had to accompany the application including a stormwater plan. They also required the lodgement of a statement of the commitments the proponents were prepared to make for environmental management and mitigation measures on site (s 75F(7)).
2. On 19 July 2011 an application was lodged under s 75E(1) of the EPAA seeking the Minister's approval to carry out the Project.
3. With effect from 1 October 2011 the PAC was delegated with the Minister's functions under Part 3A including the power to approve the carrying out of a project under s 75J(1).

Environmental Assessment Report

1. On 12 July 2012 the proponents lodged their Environmental Assessment Report (the "EAR"; see s 75H(1)). I have already summarised the EAR's description of the Project above, including the proposed staged development of the Project.
2. Section 7.2.1 of the EAR was entitled "SEPP 65 Design Principles and Residential Flat Design Code". Various matters were addressed including site design, building design and apartment mix. As part of the discussion of building design the EAR included the following:
3. Section 7.6 of the EAR addressed public transport and traffic issues associated with the Project. Section 7.15 was entitled "Stormwater Management". It noted that the stormwater management plan involved, inter alia, the "[r]elocation of two drainage easements on the southern site".
4. One of the appendices to the EAR was a stormwater management report. A section of that report addressed the topic of "Stormwater Easement Diversion". It noted that the Council had two stormwater easements" running through Site 2" and that as the Council did not permit construction over them it proposed that the easements be "diverted". Plans depicting the proposed new location for the easements were attached. Also attached was a drawing described as a "Catchment Plan, Drainage Data & Results".
5. On 17 August 2012 the Council sent a nine page letter to the Department seeking to draw its attention to various "deficiencies" in the EAR in an effort to persuade the Department to require the proponent to address them. The letter also sought an extension of time to lodge a more detailed response to the EAR. The alleged deficiencies included what was said to be relatively large scale non-compliance with SEPP 65. The Council also complained that no details concerning an "overland flow path analysis based upon 1 in 100 year ARI design storm events (pre- and post-development)" had been provided.
6. The request for an extension was granted. On 28 September 2012 the Council lodged its detailed submission in response to the EAR. Amongst other matters, the Council addressed drainage and groundwater issues associated with the Project. On that topic the Council noted that the development contemplated by the Project required the extinguishment of its easements to which it had not consented. It also contended that the relocation of pipes may have an "adverse impact to the development and surrounding area" and that "[t]herefore an overland flow path analysis based upon 1 in 100 year ARI design storm events (pre and post developments) shall be prepared and submitted to Council for review". Also, the Council repeated the complaint that a large proportion of the apartments did not comply with SEPP 65.
7. On 24 October 2012 a Departmental representative wrote to the proponents. The proponents were advised that, following a review of the EAR and the submissions provided in response, they were required to provide a Preferred Project Report and revised a Statement of Commitments (see s 75H(6) of the EPAA).
8. Two matters in particular should be noted about the letter. First in relation to apartment sizes, the proponents were advised that: "[f]urther analysis and justification of non-compliance [with] the Residential Flat Design Code guidelines for internal and external areas is required. In particular, information to demonstrate how those apartments which do not comply with the guidelines in terms of area, do achieve a satisfactory daylight access and natural ventilation. Where necessary, amendments should [be] made to the floor plans to ensure a minimum acceptable level of amenity is achieved for each dwelling."
9. Second, the proponents were also advised: "Additional stormwater management details [are] required to be provided including overland flow path analysis and emergency overflow path of OSD systems in accordance with the issues raised by Council in section 12 of their letter dated 28 September 2012."

Preferred Project Report

1. In March 2013 Don Fox Planning lodged the "Preferred Project Report and Response to Submissions" on behalf of the proponents (the "PPR"). The PPR outlined various modifications including the redesign and relocation of various buildings, as well as a reduction in the number of apartments from 443 to 428. However, it noted that the "total number of units could vary depending on detailed design and future market demands and may ultimately be in the range of 415 - 440 apartments".
2. Section 2.4 of the PPR addressed "Internal Amenity and SEPP 65." In relation to the Residential Flat Design Code (the "RFDC") the PPR stated: "The residential components of the modified development have been designed having regard to the design principles detailed in SEPP 65 and the rules of thumb provisions of the Residential Flat Design Code (RFDC)." (emphasis in original)
3. The PPR stated that the minimum size of studio apartments in the Project was 39m2, one bedroom apartments was 46m2, two bedroom apartments was 65m2 and three bedroom apartments was 113 m2.
4. Section 2.10 was entitled "Stormwater Management" and noted that the proponents were asked to address "overland flow path analysis" and "emergency overland flow path of [onsite stormwater detention] systems". On these topics the reader was referred to Appendix 10 which consisted of a series of detailed drainage plans as well as specifications for on-site stormwater detention tanks ("OSD"). One of those drawings made provision for the relocation of the two Council drainage easements on the southern site.
5. On 11 April 2013 a PAC officer sent an email to an employee of Don Fox Planning concerning a "few matters which require additional information or justification in order to finalise our assessment". One of the matters was unit sizes. The author stated that the following should be provided: "Further justification for non-compliance with SEPP 65 with regard to unit sizes. I have only looked at the single storey units so far, but it appears that around 50% of units do not meet the SEPP 65 guidelines generally for unit size. Around 15% do not meet the minimum requirements for affordable housing….. Further details at least for the units which do not meet the guidelines for unit sizes for affordable housing under SEPP 65 should be provided. A table demonstrating other amenity criteria for each of these units is to be provided…..If the table demonstrates that the units do not achieve a good level of amenity through these other measures, consideration should be given to modifications to improve compliance with unit size requirements of SEPP 65."
6. The email also requested a response to the Council's comments in relation to stormwater.

The Letter of 8 May 2013

1. A letter dated 8 May 2013 from Don Fox Planning to the Department responded to this email. I address below a factual dispute concerning whether the annexures to that letter were provided to the Council. At this point it suffices to note that I am satisfied that around 1.59pm on 8 May 2013 the letter and two of its annexures, G and H, were emailed to both the Department and the Council and that hard copies of the letter and all of the annexures were delivered to the Department the next day. I am also satisfied that around 4pm on 8 May 2013 a hard copy of the letter, its annexures and a CD, which included an electronic file containing a "DRAINS" model, were hand delivered to the Council's premises although they were not passed on to the relevant Council officers and thus, they were unaware that they had been delivered.
2. In relation to unit sizes, the letter of 8 May 2013 stated that: "……..there are a number of units throughout the development with areas less than the recommended minimum areas as noted in the Residential Flat Design Code (RFDC). In this regard, we note that the RFDC suggested minimum sizes relate to specific unit configurations and designs - configurations and designs which have not been adopted for the proposed development due to both the configurations of the proposed buildings and the likely market demand for different apartment types. In this regard, generally the residential units within the proposed development do not include hallways or corridors which many of the unit designs in the RFDC utilise." (emphasis added)
3. The letter referred to an attachment A which was an assessment of the unit sizes "against the minimum apartment sizes as noted in the Affordable Housing SEPP". It was said to show that only 61 of the 428 apartments did not "currently satisfy the minimum area requirements for affordable housing apartments as noted in the Affordable Housing SEPP". In respect of those 61 apartments, it was submitted that they were just below the minimum area and otherwise proposed modifications for nine of the apartments in this category. The letter continued: "With the modifications proposed to the layout of some apartments, only 52 apartments will be below the minimum area for apartments as specified in the Affordable Housing SEPP and of these 52 apartments, 36 will be less than 1m2 under size. In all cases, the apartments which are below the Affordable Housing SEPP areas exhibit excellent design features such as access to views and outlooks, good solar access (often more than the minimum requirement of 2 hours between 9am and 3pm on the day of the winter solstice), good cross ventilations and good aspect. In a number of circumstances, for those apartments on Level 1 which abut the communal open space areas, the minimum balcony area is much larger than the balcony as noted in the RFDC." (emphasis added)
4. In relation to the Council's submission about stormwater management, this letter attached some plans from "VDM Consulting" concerning erosion and sediment control, drainage and road modification layout, an "OSD' tank" and a catchment plan containing a table which provided "drainage data and results". The response asserted that "[t]hese plans provide the additional information sought by Council in order to assess the drainage solution proposed as part of this redevelopment".
5. On 9 May 2013 the Council wrote to the Department referring to a letter it had received from the Department dated 18 March 2013 which enclosed the PPR. It is clear that by that time the relevant Council officers were not aware that the Council had received the material delivered under cover of the letter dated 8 May 2013.
6. In relation to drainage and groundwater, the Council advised the Department that its engineer had reviewed the material and noted that no "overland flow path analysis based upon 1 in 100 year ARI design system events" had been submitted. The letter added: "Note: Extinguishment of the existing Council's drainage easement within the site cannot be supported subject to the above issues [being] addressed satisfactorily."
7. In relation to apartment size and layout, the Council submitted: "The application did not indicate the number of apartments that comply with the internal and external area requirements set out in the Part 3 of SEPP 65. Based on Council's investigation, only 76 apartments (i.e. 17% of the total number of apartments) comply with the internal area requirements. More importantly, the proponent did not provide an external area (i.e. balcony) measurement for each of the apartments. Therefore, Council is unable to determine the level of non compliances for the external areas."
8. On 27 May 2013 a town planner from the Council emailed the Department attaching "Council's draft conditions for the … project" that is, the conditions that the Council suggested the PAC should impose. Proposed condition 22 provided, inter alia: "Prior to the extinguishment of existing Council's drainage easements and relocation of Council's drainage pipes in the southern site (all work being at the cost of the proponent), detailed overland flow path analysis shall be submitted to the Council for assessment …" The balance of the proposed condition made detailed provision for the content of the analysis and included specifications for the drainage system.

Director-General's Report (EPAA, s 75I)

1. On or about 13 June 2013 the Director-General's report was signed by a Departmental official holding the position of "Executive Director, Development Assessment Systems and Approvals" (s 75I). No issue was taken with their capacity to do so, or with the fact that the report recites the "Department's" satisfaction of various matters as opposed to the Director-General's.
2. Section 3.8 of the Director-General's Report stated: "3.8 Statement of Compliance In accordance with Section 75I of the EP&A Act, the Department is satisfied that the Director-General's Environmental Assessment Requirements have been complied with."
3. As it is of potential significance to claim 4 I will set out so much of the Director-General's report as addressed the Council's concerns about the size of the apartments in the Project: "If Council's Development Control Plan were to apply to the development, very few of the proposed units would meet the minimum unit size requirements (also shown in Table 5). Further, Council is concerned that only 18% of units would meet the internal area requirements set out in the RFDC. This calculation does not take into account minimum apartment sizes recommended by the Affordable Housing Service within the RFDC. The RFDC suggests apartment sizes suitable for various unit types, but recognises that appropriate sizes are to be determined having regard to geographic location, market demands, unit configuration and affordability. Table 5 sets out the suggested range of unit sizes under the RFDC, with units at the smaller end of the scale representing the suggested minimum apartment sizes to contribute to housing affordability. The proposal includes a range of unit sizes. These are compared to the suggested RFDC sizes and the controls in the Botany Bay DCP as shown in Table 5. Table 5: Proposed Unit sizes; RFDC and Council DCP controls: Proposed units Botany Bay The Proposal RFDC Rules of consistent with DCP 35 Thumb RFDC affordable (min m2) housing sizes Studio 39-46m2 38.5m2 min 6 (100%) 60m2 1 Bedroom 50m2 -73m2 50m2-63m2 216(100%) 75m2 2 Bedroom 65m2-124m2 70m2-121m2 144(73%) 100m2 3 Bedroom 113m2-145m2 95m2-124m2 9(100%) 130m2 4 Bedroom 174m2 Not stated 1(100%) 160m2

The unit sizes recommended in the Botany Bay DCP are larger than the sizes recommended by the RFDC. Larger unit sizes are not considered to be commensurate with delivering affordable housing, but the Department considers that a range of unit sizes should be provided to ensure both reasonable internal amenity and to promote housing choice and housing affordability. It is considered that in general, units should be designed to at least meet the minimum sizes set out in the RFDC as being appropriate to contribute to housing affordability, but recognises that apartment sizes is only one factor influencing affordability and amenity. The revised PPR incorporate 428 units of which 376 (88%) comply with the recommended unit sizes for affordable housing under RFDC. Of the remaining 52 units which would not comply, all are 2 bedrooms in size and: The majority (36 units) are only 1m2 below the minimum area (ie 69m2). All units have either northerly or easterly aspects and all would benefit from natural cross-ventilation. A total of 20 of those units would have northerly views of the city skyline and many incorporate views of the Australian Golf course; Another 8 units are 68m2 and there 2m2 below the minimum suggested area. They would also have a northerly aspect and good solar access, natural cross ventilation, a pleasant outlook with some access to district views; and The remaining 8 units are 67m2, or 3m2 below the minimum suggested areas. They would all be corner units with good cross ventilation and incorporate good design to maximize space. Half of the units would have a northern orientation with good solar hours of solar access to living areas or open space areas at mid-winter. They have private open space areas of 8m2 except for the podium level unit which has a generous 17m2 private open space area. The Department considers that the three south facing units above the podium level which have neither solar access nor increased open space should be amended to provide improved levels of amenity."

1. In relation to stormwater, the Director-General's report stated: "Council raised a number of concerns in relation to drainage infrastructure, which would require upgrading as a result of the proposal. Outstanding issues relate mostly to the need for additional information demonstrating overland flow path modelling; DRAINS modelling, and certain calculations, as well as an issue with an access route located over an adjacent premises. Additional Information submitted by the proponent on 8 May 2013 to address Council concerns included the requested modelling and calculations and deleted the access route previously proposed. The information was forwarded to the Council and no further submission has been received. ... The Department is satisfied that the proposed upgrades to drainage infrastructure would adequately deal with drainage and stormwater from the site and the adjoining public domain, so that no significant flooding or stormwater impacts would arise from the development" (emphasis added)
2. Appendix E to the Director-General's report contained a draft approval and proposed conditions under s 75J. Proposed condition B2 was headed "Design Modifications" and provided for certain modifications to three units to "ensure [they] meet size recommendations of the Residential Flat Design Code". The three units identified were the "three south facing units" referred to in the passage in [52]. Proposed condition B18 was condition 22 proposed by the Council noted above (at [49]).

The Link Road and the Easements

1. On 9 July 2013 representatives of the Council meet with the PAC. One issue raised by the Council was a possible modification of the Project to include a road linking Racecourse Place to St Helena Parade (the "link road"). It seems that the Council had retained its own architects, Rice Daubney Architects, who had prepared a concept plan incorporating the link road. According to a PAC memorandum the "proponent[s] agreed to give further thought to the option" of the link road.
2. After the meeting, on 18 July 2013, the Council's solicitors wrote to the PAC referring to the meeting on 9 July 2013. They stated as follows: "One of the concerns raised which perhaps warrants clarification is the inconsistency of the proposal with the Council's existing drainage easement registered on the title to the development site. The proponent simply asserts that the easement will be extinguished. This can only be done by agreement with the Council or pursuant to an order of the Supreme Court under s89 of the Conveyancing Act 1919. Were the proposal as currently presented to be approved it would be incapable of being implemented unless and until the easement was extinguished by one of the two means of extinguishment."
3. On 23 July 2013 Don Fox Planning wrote to the PAC addressing a number of issues that had been raised at the consultation meeting on 9 July 2013. Amongst other matters it outlined numerous grounds of opposition to the inclusion of the link road. On the same day the PAC discussed the link road proposal with the proponents.
4. The PAC held a public consultation meeting on 24 July 2013. The proposal for the link road was discussed. On 29 July 2013 Don Fox Planning wrote in response to the issues raised including unit sizes and the suggested inclusion of the link road. On 6 August 2013 the Council's General Manager wrote a letter reiterating seven "planning principles" outlined by the Mayor in the meeting including the inclusion of the link road and concerns about unit sizes. Don Fox Planning responded on 14 August 2013.
5. On 10 September 2013 there was a meeting between the proponent's advisors and the PAC in which further modifications to the PPR were outlined. The first set of modifications to the PPR were outlined in the letter of 8 May 2013 noted at [42]. Detailed plans incorporating the modifications were emailed to the PAC on 12 September 2013. The modifications included a reduction in the ground floor area allocated to retail and residential uses as well as a reduction in the number of one, two and three bedroom apartments.

The Approval

1. On 19 September 2013 the PAC granted the Approval pursuant to s 75J(1) for the carrying out of the Project. Its three members signed off on a minute outlining at least some aspects of their reasons for approval on that day. The minute records the PAC granted approval "subject to [the Department's] recommended modifications as well as approval conditions as amended and supplemented by the Commission". The PAC rejected the option of including the link road. I set out below its reasons for doing do so. Otherwise, it should be noted that the minute was provided in a context where there was no statutory obligation on the PAC to provide reasons.
2. The Approval is recorded in a separate document to the minute. Schedule 2 to the Approval is a set of conditions determined under s75J(4). Condition A1 stated: "A1 Development Approval is granted only to carrying out the development described in detail below: demolition and removal of all existing buildings; construction of a mixed use development generally between 2-6 storeys above podiums in height except at the corner of Evans Avenue and Racecourse Place, where a maximum height of RL 48.7 AHD applies; maximum ground floor retail and community floor space of 14,404m2; maximum 405 residential apartments with a maximum GFA of 34,636m2; 916 basement car parking spaces over two levels; associated landscaping; associated infrastructure, stormwater and utility works; and stratum subdivision."
3. Condition A2 stated that the development was to be undertaken "generally in accordance with" the EAR "except where amended by the [PPR] and as amended by information submitted on 8 May 2013, including all associated documents and reports", a draft statement of commitments submitted by Don Fox Planning and certain specified drawings (subject to certain exceptions including as provided for in the conditions of approval).
4. Part B listed various conditions that had to be complied with prior to the issue of a construction certificate. Condition B2 was headed "Design Modifications". It provided, inter alia: "B2 Prior to the issue of the first Construction Certificate, plans and specifications demonstrating incorporation of the following modifications shall be submitted and approved by the Director General. (a) Unit sizes shall be amended to meet the requirements of the Residential Flat Design Code; (b) …………."
5. Conditions B18 to B21 concerned stormwater drainage. Condition B18 was in the same form as the draft condition proposed by the PAC and was thus in the same form as that proposed by the Council (see [49]).
6. The final statement of commitments was included in schedule 3 to the Approval document. Commitment 21 was to the effect that the retail development in Stage 1 would be completed and operational prior to the commencement of work on Stage 2.
7. Either attached to, or accompanying, the Approval was a series of plans stamped as being approved on 19 September 2013 (the "approved plans"). Condition A3 provided that, in the event of an inconsistency between the conditions and the approved plans, the conditions would prevail. One of those plans which related to Stage 2, DA010, contained an entry: "relocate drainage easement".

The Attachments to the Letter of 8 May 2013

1. As noted above, there was an evidentiary dispute as to whether the Council was provided with the attachments to the letter dated 8 May 2013 from Don Fox Planning. While the legal significance of the resolution of that dispute was far from clear, I will address it.
2. The proponents read an affidavit from Ellen Robertshaw, a partner of Don Fox Planning. Ms Robertshaw stated that on 8 May 2013 at 1.59pm she sent an email to a Departmental Officer, Natasha Harras, which was copied to Ms McMahon at the Council. This email attached the letter dated 8 May 2013 and enclosed two of the annexures referred to in the email being annexures G and H. She described annexure F as containing "stormwater plans and a DRAINS model which had been specifically requested by Council". She said that the DRAINS model was only an electronic file.
3. Ms Robertshaw said that around 4pm on 8 May 2013 she attended "the front counter of the Council at 141 Coward Street, Mascot and hand delivered a hard copy of the letter, all annexures A - H which were bound in a booklet style, a CD which contained PDF files of the revised PPR and electronic files showing shadows, further stormwater plans and a DRAINS model". She recalled asking the counter staff to provide them to Ms McMahon.
4. At 5.02pm on 8 May 2013 Ms Robertshaw sent an email to Ms Harras stating that she had not been to the Department's offices "but did manage to drop off a hard copy and CD to Council". She stated that she hand delivered the letter and the annexures to the Department's information desk on 9 May 2013.
5. In his first affidavit, Council's Director of Planning and Development, Rodger Dowsett stated that the Council had never received an overland flow path analysis. In his second affidavit Mr Dowsett confirmed that on 8 May 2013 Ms McMahon's inbox received an email from Ms Robertshaw that attached a copy of the letter of 8 May 2013 and annexures G and H referred to in the letter, neither of which related to drainage. The email from Ms Robertshaw also stated that "[h]ard copies and CD of the document will be delivered to [the Department's] office today". Nonetheless, Mr Dowsett asserted that the Council did not receive either a hard or soft copy of the other attachments to the email.
6. In her affidavit, Ms McMahon stated that she was on leave on 8 and 9 May 2013 but that on her return she became aware of the email, the attached letter and attachments G and H. She did not receive a hard copy of the other annexures. In her affidavit the Council's records supervisor, Lisa Zhou, outlined the Council's system of recording the receipt of documents by the Council at its reception desk, its customer service counter as well by post, document exchange and email. Ms Zhou said they were stored on an electronic file document system known as "TRIM". Ms Zhou's review of the TRIM system confirmed the receipt by Council of the email dated 8 May 2013 and its attachments but stated the system had no record of any documents being delivered to Council on 8 May 2013 by Ms Robertshaw.
7. None of the deponents to the affidavits were required for cross examination. While the Council's witnesses, including those referred to above, established that the Council's system of recording the receipt of documents was generally effective they did not demonstrate that it was foolproof. They do not persuade me to reject Ms Robertshaw's evidence, especially in the absence of her being cross examined. Ms Robertshaw's email is powerful evidence corroborating her evidence that she delivered all the annexures to Council (see [70]). I accept her evidence. I also accept that the documents and CD that Ms Robertshaw hand delivered to the Council were not provided to the relevant Council officers dealing with the project, including Ms McMahon.

Claim 1: Project incapable of being carried out with the easements being extinguished

1. APOC [14] and [15] asserts that the "Approved Project involves" construction of a kind that would constitute an interference with Council's easements, that it requires the extinguishment of the easements, that the easements have not been extinguished and the Council has not agreed to their extinguishment. APOC [16] assert that three legal consequences follow from these matters namely that: "(a) the Approved Project … is incapable of being lawfully carried out in compliance with the conditions to which the approval is subject; (b) were the Approved Project to be carried out, it would be carried out in breach of s 75D(1) of the [EPAA] and a breach of the [EPAA] within the meaning of s 122 [thereof] entitling the Applicant to relief pursuant to ss 123 and 124 of the [EPAA]; [and] (c) the Applicant is [therefore] entitled to the declaration in paragraph 2 of the Amended Summons and the order sought in paragraph 3."
2. The declaration sought in [2] of the Amended Summons is to the effect that "the development as approved is incapable of being carried out or carried out in compliance with the conditions to which the approved project is subject". Paragraph 3 of the Amended Summons seeks an order in the nature of a permanent injunction restraining the carrying out of the "development pursuant to the [A]pproved [P]roject".
3. I have already referred to the evidence concerning the significance of the Council's easement(s) to the completion of the Project. In summary, to complete Stage 2 of the Approved Project in accordance with the conditions attached to the Approval the Council's easements must be relocated. This means that they would have to be extinguished either by agreement with the Council or pursuant to the statutory regime provided for by s 89 of the Conveyancing Act 1919 (NSW). This is reflected in condition B18 of the Project Approval (see [53]). The completion of Stage 1 does not require the relocation of any of Council's easements.
4. In relation to extinguishment under s 89, the Council's written submissions referred to the decision of Brereton J in Fraser Lorne Pty Ltd v Burke [2008] NSWSC 743 and invited this Court to conclude that "[t]here is no evidence that there is any prospect, let alone a reasonable prospect, that the developers would be able to succeed in an application for the extinguishment or modification of the Council's drainage easements" (Applicant's opening submissions at [68]; "Council subs").
5. Three matters should be noted. The first concerns the effect of an approval being granted under s 75J(1). Its legal significance is to relieve a proponent from of the prohibition on "carry[ing] out development that is a project" to which Part 3A applies (and confer the protection provided by Division 4 of Part 3A; see [17]). The granting of an approval does not affect the proprietary rights of a third party such as the Council (Rothwell Boys Pty Ltd v Coffs Harbour City Council (2012) 186 LGERA 366 at [5] per Craig J). If the carrying out of a development in accordance with the terms of an approval involves an interference with any such proprietary rights then, at the point at which an unlawful interference with those rights is threatened, imminent or occurring the affected party can approach the Supreme Court. However, contrary to the APOC, such action by the proponents would not involve a breach of s 75D(1).
6. The second matter to note is that at no stage has Council expressly stated that it will never grant consent to the extinguishment of its easements. The Council's letter dated 18 July 2013 to the PAC did not state that the Council would never grant consent (see [56]). At no point was the PAC, or this Court, told that the Council would never grant any such consent. It would be surprising if it had stated that as all public bodies including Council's must consider such matters bona fide. It could not simply set itself against ever granting approval to relocate the easement simply because it did not agree with the PAC's decision. How could this Court conclude that the interests of the Council's ratepayers would inevitably be best served by the Council necessarily refusing to consent to the extinguishment in the future on any terms?
7. The third matter to note is that, at most, it was only necessary for the PAC and is only necessary for this Court to note the possibility of extinguishment occurring by reason of an order being made under s 89 of the Conveyancing Act 1919. As noted, the Council sought to have this Court embark upon an assessment of what the likely outcome of such an application might be. However, such an application might not be made until after negotiations over a consensual extinguishment are exhausted and Stage 1 is completed, which could be years hence. This only illustrates that it would be a futile exercise to attempt to assess the likely outcome of such an application, even if that was appropriate, which in my view it is not. There is nothing in the EPAA which justifies this Court speculating as to the outcome of an application by the proponents to the Supreme Court under s 89 of the Conveyancing Act
8. In the end result the prospect of Council's easement being extinguished so as to allow Stage 2 to proceed remains a contingency that may or may not be fulfilled. It is a commercial risk that the proponents are prepared to assume. The existence of the contingency has no relevance to the validity of the PAC's approval and nor does it give rise to an actual or even threatened breach of the EPAA.
9. It follows that there is no proper basis for making the second declaration referred to in the Amended Summons (see [75]). The contention that the Project "is incapable of being carried out or carried out in compliance with the conditions" of the Approval has simply not been made out. To the contrary, the material before the PAC and this Court only demonstrates that extinguishment may or may not occur. In any event, this Court would not grant a declaration of that kind. It does not reflect the application of the EPAA or any other relevant environmental legislation to findings of fact made by the Court concerning events that have happened. Instead it purports to record a prospective assessment of the likelihood that the carrying out of the Project would unlawfully interfere with the Council's proprietary rights. It is necessarily preliminary and as such is clearly not a suitable matter for declaratory relief (see Bass v Permanent Trustees (1999) 198 CLR 334 at [45] to [49]; and R v Trade Practices Tribunal; Ex Parte Tasmanian Breweries Pty Ltd (1970) 123 CLR 361 at 374 per Kitto J). Further, as the incapacity referred to in the proposed declaration is said to flow from an interference with proprietary rights, and not a contravention of the EPAA or other environmental legislation, it is doubtful that this Court has power to grant such relief although it is not necessary to consider that further.
10. It further follows that this claim raises no basis for granting the relief sought in [3] of the Amended Summons. There is no actual, or even threatened, breach of the EPAA. In oral argument, Senior Counsel for the Council sought to circumvent this. He contended that the conditions attached to the Approval obliged the proponents to complete the Project. He further contended that those conditions would inevitably be breached because the proponents could not complete the Project due to the existence of Council's easements and thus there would inevitably be a failure to comply with s 75D(2) justifying the granting of injunctive relief under s 122 of the EPAA. I have already rejected so much of the second of these contentions that assert that it was inevitable that the Project would not be completed because of the existence of Council's easements. In addition, the first contention has no substance. The conditions attached to the Approval do not compel the completion of the Project. At most the statement of commitments preclude the commencement of Stage 2 before the completion of Stage 1, but that is all.
11. I reject the Council's first claim.

Claim 2: Failure to Consider Incapacity to Carry out Project

1. Claim 2 is related to claim 1. APOC [17] asserts that "the fact that the Approved Project was incapable of being lawfully carried out by reason of the existence of the [Council's] easements" was a "matter that was relevant" to the decision to approve the Project under s 75J(1) (and that it was manifestly unreasonable not to consider it) and "a matter relevant to be included in the Director-General's report under s 75I" (and that it was manifestly unreasonable not to consider it). APOC [18] asserts that "fact" was not considered in making the decision to approve and was not included in the Director-General's report. APOC [21] asserts that those matters rendered the decision to approve the Project "void".
2. The Council's written submissions in support of claim 2 built upon its submissions in relation to claim 1. In particular it was contended that there was a "substantial defect" in the PAC's decision making process because "there was an unknown degree of risk that, after demolition, the construction phase of the Project could not lawfully proceed" (Council's subs at [69]).
3. As formulated this claim does not allege any matter that could constitute a basis for invalidating the decision under s 75J(1) or the Director-General's report in that the supposed incapacity to lawfully carry out the Project is not pleaded to be a matter that the decision maker was bound to consider but instead only identifies it as a matter said to be "relevant" to both decisions (cf Minister for Aboriginal Affairs v Peko Wallsend Ltd (1986) 162 CLR 24 at 39 - 40 per Mason J) ("Peko-Wallsend'). Further, as formulated, the claim only identifies an alleged fact that was said to be relevant to the exercise of the power instead of identifying some factor that the EPAA required be considered.
4. Otherwise, the Council's submissions did not identify why the alleged (legal) incapacity to complete the Project was a matter or factor that the Director-General was required to include in his or her report under s 75I (as modified) or was a matter that the Minister or his delegate was bound to consider in exercising the power conferred by s75J(1).
5. In relation to s 75I, s 75I(2) specifies the matters that must be included in the report. None of ss 75I(2)(a), (c), (d) and (e) require the inclusion of any reference to any legal incapacity to complete the approved project. The advice referred to in s 75I(2)(b) might encompass a consideration of the impact of the approved project on easements or other Council property if the public authorities in question addressed the topic. In this case, the Director-General's report passed on the advice from the Council and in doing so adequately relayed the Council's position concerning the relevance of Council's easements to the completion of the Project. (This also satisfies regulation 8B). Subsection 75I(2)(f) does not appear to have imposed any substantive obligation on the Director-General other than to include whatever environmental assessment he or she undertook and whatever matter he or she considered appropriate, and nothing else (Drake- Brockman v Minister for Planning (2007) 158 LGERA 349 at [97] per Jagot J). For the reasons addressed below s 75I(2)(g) has no substantive role to play.
6. In relation to the power conferred by s 75J(1), s 75J(2) specifies the matters that must be considered and s 75J(3) identifies another factor that may be taken into account. None of those matters embrace any alleged legal incapacity to pursue the approved project (other than to the extent that might be included in any "reports, advice and recommendations" provided with the Director-General's report). Further, while clause 2A of Schedule 6A might have enabled the Minister to consider this matter as a component of the "public interest" it does not make it obligatory for the Minister to have done so.
7. There remains the possibility that the obligation to consider the matter referred to in this claim can be derived by implication from the subject-matter, scope and purpose of the EPAA. In Peko Wallsend (supra) at 39 - 40 Mason J summarised the relevant principles as follows: "What factors a decision-maker is bound to consider in making the decision is determined by construction of the statute conferring the discretion. If the statute expressly states the considerations to be taken into account, it will often be necessary for the court to decide whether those enumerated factors are exhaustive or merely inclusive. If the relevant factors - and in this context I use this expression to refer to the factors which the decision-maker is bound to consider - are not expressly state, they must be determined by implication from the subject matter, scope and purpose of the Act. [W]here the ground of review is that a relevant consideration has not be taken into account and the discretion is unconfined by the terms of the statute, the court will not find that the decision-maker is bound to take a particular matter into account unless an implication that he is bound to do so is to be found in the subject matter, scope and purpose of the Act."
8. Subsection 75I(1) does not confer a discretionary power on the Director-General. Instead, it imposes an obligation on the Director-General to provide a report the contents of which are specified in s 75I(2). I do not see any scope for implying any obligation to include any matter in the report not specified in that subsection (or regulation 8B). Subsection 75J(1) does confer a discretionary power but, in light of ss75J(2) and 75J(3), the power cannot be described as "unconfined" . Given the structure of s 75J I do not accept that, in exercising the power conferred by s 75J(1), the Minister was obliged to consider some matter not specified in s 75J(2) including the (alleged) incapacity to complete the Approved Project.
9. It follows that so much of claim 2 which is pleaded in APOC [17] to [18] fails at the outset because the necessary legal premise upon which it rests was not established. It also fails because the factual premise of the claim, namely that the Approved Project was "incapable of being lawfully carried out by reason of the existence of the [Council's] easements", has also not been made out. For the reasons addressed above in relation to claim 1, the material before the PAC and this Court only demonstrated that extinguishment may or may not occur.
10. Otherwise, the Council did not establish that either the Director-General or the PAC did not take into consideration the necessity to extinguish the Council's easements to complete Stage 2. The letters and submissions sent on behalf of the Council dated 28 September 2012, 9 May 2013 and 18 July 2013 all made reference to the necessity to extinguish the easements. The Council's email of 27 May 2013 suggested a condition that contemplated the extinguishment of Council's easement (but only after the provision of a detailed overland flow path analysis). The Director-General's report dated 13 June 2013 expressly noted the Council's contention that "[n]o approval has been given for extinguishment of Council's drainage easements" and included the condition proposed by the Council. Similarly appendix 2 to the PAC's minute included a summary of the meeting with the Council on 9 July 2013 which noted that "[t]he proposal would involve Council's easement which runs parallel to the reserve". As noted the PAC imposed a condition contemplating extinguishment as suggested by the Council.
11. The remaining issue in relation to claim 2 is the contention in APOC [19] that it was "manifestly unreasonable" to approve the Project "otherwise than subject to a condition that the approval would not operate unless or until the easements had been extinguished."
12. As formulated, this part of the APOC invokes the ground of judicial review known as "Wednesbury unreasonableness" (Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1 KB 223 at 229 to 231). Wednesbury unreasonableness concerns the abuse of discretionary powers (Minister for Immigration and Ethnic Affairs v Eshetu (1999) 197 CLR 611 at [124] per Gummow J; Re Minister for Immigration and Multicultural Affairs; Ex parte Applicant S20/2002 [2003] HCA 30; 198 ALR 59 at [73] per McHugh and Gummow JJ). The stringency of the test of unreasonableness was discussed in the various judgments in Minister for Immigration and Citizenship v Li (2013) 249 CLR 332 at [30] per (French CJ), at [67] to [76] (per Hayne, Kiefel and Bell JJ) and at [106] to [109] (per Gageler J) . In particular, Gageler J noted the rarity of success of such a ground (at [113]). Although Li was a case in which a finding of unreasonableness was upheld (at least by French CJ at [31] and Gageler J at [124]) it is notable that the decision held to be unreasonable was a refusal to grant an adjournment. Thus Li concerned a procedural decision with which reviewing courts are familiar. Such decisions can be contrasted with decisions that are legitimately informed by "considerations of policy" (Li at [108] per Gageler J). Similarly, as the decision attacked by this claim concerns matters of planning and development, the task of demonstrating unreasonableness is made that much more difficult (Li at [108] per Gageler J). Otherwise it suffices to note the observation of Hayne, Kiefel and Bell JJ (at [76]) that "[u]nreasonableness is a conclusion which may be applied to a decision which lacks an evident and intelligible justification."
13. I am not persuaded that it was manifestly unreasonable to grant the Approval without the condition referred to in APOC [19]. I have already traced the submissions made to the PAC concerning the extinguishment of the Council's easements. I have observed that the Council never stated that it would not agree to the extinguishment of its easements. To the contrary, the Council suggested the inclusion of a condition about the provision of a detailed overflow path analysis prior to the extinguishment of its easements. Despite this, the Council contends that it was unreasonable not to include a condition that was inconsistent with the condition it suggested to the PAC, namely that the Approval would not operate unless or until the easements were extinguished. The imposition of the condition now suggested by the Council would have placed the proponents in a position of unfair disadvantage in dealing with Council in that they would have been unable to start Stage 1 of the project without having secured the extinguishment of the easements, even though that was only necessary for Stage 2, and the commencement of construction of Stage 2 would not take place for many years. The pursuit of the entire Project would have been hostage to negotiations over the extinguishment of the easements.
14. I reject claim 2.

Claim 3: Groundwater and Drainage

1. The Council's third claim attacks both the PAC's approach to groundwater and drainage issues raised by the Project when considering granting approval under s 75J(1) and the approach taken by the Director-General to those issues in the report prepared pursuant to s 75I. I will first address the challenge to the PAC's decision.

The PAC and Groundwater

1. I noted in [24] that the Director-General's Requirements issued under s 75F of the EPAA required the proponents address to "key issue 13" which concerned drainage and groundwater issues. Key issue 13 was described as follows: "The EA shall address drainage/flooding issues associated with the development/site, including: stormwater, drainage infrastructure (infrastructure Management Plan) and incorporation of Water Sensitive Urban Design measures (Integrated Water Management Plan). The EA is to identify groundwater issues and potential degradation to the groundwater source and shall address any impacts upon groundwater resources, and when impacts are identified, provide contingency measures to remediate, reduce or manage potential impacts."
2. APOC [23] contends that the PAC was required to consider key issue 13 in determining whether to grant approval under s 75J(1). I will pass over that contention at this point. APOC [24] contends that the PAC failed to consider, or adequately consider, the matters referred to in key issue 13 which in light of the assertion in [23] is said to result in the decision under 75J(1) being invalid. The particulars supporting these contentions identify eight matters. The first two are the Council's letter dated 17 August 2012 ([31]) and the Council's submission dated 28 September 2012 ([32]) both of which sought an "overland flow path analysis". The third matter was the letter to the proponents dated 24 October 2012 which, inter alia, relayed that request to the proponents ([33]). The fourth particular was the Council's letter of 9 May 2013 which asserted that no overland flow path analysis had been submitted ([46] to [47]). However that assertion needs to be understood in light of the findings at [42] (and [73]) namely that on 8 May 2013 the proponents' advisors delivered to the Council hard copies of a letter bearing that date, its annexures and a CD containing electronic files that included a "DRAINS" model.
3. The balance of the particulars in support of the assertion that the PAC failed to consider "or adequately consider the matters referred to in key issue 13" are as follows: "(v) Having regard to the topography of the land, the scale and design of the development and that it contained a below ground car park and proposed the extinguishment of the easement, normal practice in assessing the drainage, flooding and stormwater impacts of the development would require such an overflow path analysis; (vi) No such overland flow path analysis was provided to or considered by the First Respondent or the Director General; (vii) In the absence of such an overland flow path analysis no adequate assessment of the drainage, flooding and stormwater impacts of the development could be made; (viii) The Director General in his Environmental Assessment Report accepted what was contained in the letter from the proponent dated 8 May 2013 in response to the Applicant's submission referred to in (a) without sending the report to the Applicant or giving it any opportunity to respond to the assertions in that letter."
4. Four matters should be noted about these particulars. First, particular (viii) asserts that the Council did not have the opportunity to respond to the assertions in the letter of 8 May 2013. Given that there is no complaint that the Council was denied procedural fairness it is difficult to understand the legal relevance of this assertion. However in any event, it is baseless. The Council never disputed receiving a copy of the letter by email. The only dispute in this Court concerned whether it received all of the annexures to that letter. I have found that it did. It follows that I am satisfied the Council had a proper opportunity to respond to the letter and its accompanying material. To the extent that the Council may have been hampered in responding because the relevant members of its staff did not have all the annexures to the letter that was a result of a breakdown of its own procedures.
5. Second, particular (v) asserts that it was "normal practice" when assessing the drainage, floodwater and stormwater impacts of a development to require an overland flow path analysis. This contention is problematic. As most the evidence travels no higher than establishing that it was Council's usual practice to require such an analysis. Thus, the Council's written submissions on this topic repeatedly referred to "normal practice in the Botany Bay City Council region". However, the Council does not exercise any function under Part 3A and its practices do not provide any evidentiary basis for establishing some form of normal practice for approvals under s 75J(1), assuming that had any legal significance.
6. Third, these particulars either assert or assume that nothing answering the description of an "overland flow path analysis" was provided by the proponents. The only "requirement" imposed on the proponents to provide such an analysis prior to the granting of the Approval was that set out in the letter of 24 October 2012 noted above at [33]. Arguably that letter involved an exercise of the power conferred by s 75H(6) (see [11]). The concept of an "overland flow path analysis" was not defined and this Court was not provided with the means of determining whether what was attached to the letter of 8 May 2013 answered that description or not. The Director-General appeared to consider that it did ([53]). I have already noted that, at the Council's suggestion, a condition was imposed requiring a (more) detailed overland flow path analysis prior to the extinguishment of the Council's easements.
7. The Council bears the onus of proof of the matters it particularised. It follows from the above that particulars (v), (vi) and (viii) are not made out. It further follows that the premise of particular (vii), namely the absence of an overland flow path analysis, has not been established.
8. Fourth, particular (vii) asserts that the absence of such an analysis meant that it was not possible to assess the drainage, flooding and stormwater impacts of the Project. The Council's written submissions in support of that assertion refer to the other matters particularised in [24] of APOC which I have already addressed (Council's subs at [72]). Otherwise, this particular overlooks the material that was supplied on behalf of the proponents in the letter of 8 May 2013 and its attachments, as well as the fact that no question of relocating Council's easements arises in relation to the completion of Stage 1.
9. The particulars to APOC [24] are all directed towards establishing, as a fact, that the PAC did not consider the matters referred to in key issue 13. It follows that I am not satisfied that the Council has established that fact. A significant amount of material addressing those issues was provided to the PAC. The PAC considered that material and addressed the issues raised by key issue 13 in the conditions it imposed, including the very conditions suggested by the Council. Even if the material provided to the PAC did not answer the description of an overland flow path analysis that does not matter. Key issue 13 does not refer to an overland flow path analysis and there was otherwise nothing in Part 3A or in the actions taken under it which made the validity of any grant of approval under s 75J(1) dependent upon the provision of such an analysis.
10. To this point I have not addressed the assertion in APOC [23] that the exercise of power under s75J(1) requires the Minister to address the Director-General's requirements as made under s 75F. It is not necessary to consider that further because, in any event, it follows from [108] that the pleaded version of so much of claim 3 as concerns the PAC's decision under s 75J(1) must fail.
11. The Council's written submissions appeared to expand the pleaded case concerning this aspect of the third claim as follows: "98. In the circumstances and particularly having regard to the importance of an overland flow path analysis to understanding this development, the absence of such an analysis meant that the PAC: (a) was not in a position adequately to understand the Project and so not in a position to approve the project; (b) acted unreasonably by giving inadequate consideration to the drainage, flooding and stormwater impacts of the development; (c) acted unreasonably by furnishing no objective or intelligible justification for refusing the Council's claim that an overland flow path analysis was needed to understand the Project, in circumstances where the Director-General had acknowledged the need for such an analysis."
12. The assertion in [98[a)] of the Council's written submissions that, without an overland flow path analysis, the PAC "was not in a position to adequately understand the Project" was not expanded upon and I do not accept it. In its submissions to the PAC, the Council never attributed such significance to an overland flow path analysis. To the contrary the metes and bounds of the Project were well defined. In any event, as I have stated, I am not persuaded that an overland flow path analysis of some kind was not provided to the PAC. The Council received the letter of 8 May 2013 and its attachments. The Council did not pursue the issue of an overland flow path analysis any further prior to the approval stage. Instead it proposed the inclusion of a condition that a detailed analysis be provided prior to the extinguishment of the Council's easements and the PAC agreed.
13. The assertion in [98(c)] of the Council's written submissions suffers from similar problems to that made in [98(a)]. At no point in its submissions to the PAC did the Council assert that an overland flow path analysis was "needed to understand the Project". Further, the PAC's approach did not lack any "objective or intelligible justification". Having regard to the material supplied with the letter of 8 May 2013, and the approach taken by the Council in response, the PAC approached the matter by imposing a condition on the Approval that a detailed analysis should be provided to the Council prior to the extinguishment of its easements. This approach certainly answers the description "reasonable" given that this issue only affected Stage 2 and that the approach adopted by the PAC of imposing a condition was that suggested by the affected stakeholder, namely the Council. The assertion in [98(b)] of the Council's written submissions fails for the same reasons.
14. It follows that the Council has failed to establish that this aspect of the PAC's decision under 75J(1) was manifestly unreasonable.

The Director-General's Report and Groundwater

1. The other aspect of claim 3 attacks the validity of the Director-General's report. In effect the Council contended that the preparation of a valid report by the Director-General under s 75I was a precondition to the validity of an approval under s 75J(1). In support of that contention, the Council pointed to s 75J(1)(b) and s 75(2)(a) and cited Warkworth Mining Ltd v Bulga Milbrodale Progress Association Inc (2014) 307 ALR 262 at [182] (per Bathurst CJ, Beazley P and Tobias AJA). I will assume the contention is correct without deciding it.
2. The attack on the validity of the report concerned the statement of compliance included in the Director-General's report (see [51]). Both APOC [24A] and [24B] contended that the Director-General was not properly satisfied that the Project complied with the environmental assessment requirements and repeated the particulars to APOC [24]. APOC [24A] contends that, as a consequence, the Director-General's Report was "invalid." APOC [24B] asserts that the "statement relating to compliance with the environmental assessment requirements under Div 2 of the former Pt 3A" was also invalid for the same reasons.
3. I have already addressed the particulars to [24] of the APOC (at [104] to [108]).The effect of that discussion is that I am not satisfied that the Director-General's report failed to address key issue 13 of the Director-General's requirements. The Council's written and oral submissions did not advance any matter concerning the Director-General's report that has not been addressed in the above discussion. It follows that the factual basis for this aspect of claim 3 is not made out.
4. However, this aspect of claim 3 also fails because it ignores the effect of the transitional provision noted in [13], namely clause 3D of Schedule 6A. Its effect was, that in its application to the Project, s 75I(2) did not require a statement relating to compliance with the environmental assessment requirements and s 75J(2)(a) did not require the PAC to consider any such statement. It follows that the statement in the Director-General's report noted in [51] did not, of itself, have any legal significance under Part 3A. Contrary to APOC [24A] and [24B] that statement was not a statement "under Division 2 of the former Pt 3A". Thus, it was not a pre-condition to the validity of anything that there be such a statement (but even if there was, all that was necessary was that there be a statement relating to compliance: Drake Brockman at [106] to [109]).
5. I reject claim 3.

Claim 4: Condition B2 and the Residential Flat Design Code

1. The Councils' fourth claim concerned sub-paragraph (a) of condition B2 (see [63]). I have already traced the various submissions that were made to the PAC on the issue of apartment size. Ultimately the PAC strengthened the condition suggested by the Director-General (see [54]) so that instead of requiring amendments to the plans for "the three south facing units" ([54]), the proponents were required to submit amended plans that provided for all "unit sizes" to "meet the requirements of the [RFDC]".
2. I address below the five submissions made by the Council concerning condition B2(a) and its impact on the validity of the Approval. As will become clear, much of the dispute between the parties turns upon the proper construction of that part of the condition that refers to "[u]nit size … requirements of the [RFDC]". However, before addressing that I will outline the relationship of the RFDC to SEPP 65, the operation of the RFDC and the impact on the Project that might result from implementing condition B2(a) depending on which of the competing constructions of the condition, if any, is to be preferred.

SEPP 65

1. Nothing in Part 3A of the EPAA required either the Director-General or the PAC to have regard to "State Environment Planning Policy No 65 - Design Quality of Residential Flat Development" ('SEPP 65"). However it was referred to at various points and its salient features for the relevant period should be noted, at least so far as they may be relevant to claim 4.
2. Part 2 of SEPP 65 specifies 10 design quality principles applicable to residential flat development. Part 3 provides for the appointment of "design review panels" for one or more local government areas (clause 19(3)). They are invested with various functions including providing advice to consent authorities and local council's on various matters relevant to the development of residential apartments (clause 27).
3. Part 4 of SEPP 65 is headed "Application of design quality principles". Clause 28 within Part 4 requires a person who prepares any of an environmental planning instrument, a development control plan or a master plan (or similar plan) to, inter alia, "have regard to the publication Residential Flat Design Code (a publication of the Department of Planning, September 2002)". Sub-clause 30(2)(c) imposes a similar requirement on the determination of a development application for consent to carry out a residential flat development. Subclause 30A(1)(b) of SEPP 65 precludes a consent authority from refusing development consent on the grounds, inter alia, of (too small) apartment area "if the proposed area for each apartment is equal to, or greater than, the minimum recommended internal area and external area of the relevant apartment type set out in Part 3 of the [RFDC]". This appears to be a reference to the table noted in [129] below.

The RFDC

1. It was common ground that the RFDC was not made under statute or regulation and did not at the relevant time, by itself, have any force of law except to the extent that it was expressly incorporated in some other instrument such as SEPP 65. In this case the effect of condition B2(a) was that at least some aspects of it were incorporated into the Approval although there was a substantial contest as to which ones.
2. The RFDC appears to have been first published in 2002. The opening part of the RFDC is a statement by the then Premier outlining various steps undertaken by the State government in the period around 2000 concerning the design and construction of apartments in urban areas including the promulgation of SEPP 65. The former Premier also stated: "… this document, the Residential Flat Design Code will arm Council planners, developers and architects with detailed guidance on how to improve those elements that go towards achieving better designed flat buildings."
3. The preface describes the role of the RFDC as: ".. set[ting] broad parameters within which good design of residential flat buildings can occur by illustrating the use of development controls and consistent guidelines. It will be an important resource for council planners responsible for creating new plans relating to residential flats and for assessing residential flat development under SEPP 65. With the SEPP, it provides the "how to" of designing better built outcomes."
4. Within the "introduction" section of the RFDC there is a heading "Document structure and use". It states that the document addresses three "different scales" in relation to residential flat development being local context, site design and building design. It also states: "Within each section, information sheets outline specific topics and elaborate on how the topic improves the design quality of residential flat development… 1. descriptive text defines the topic and explains why it is important 2. objectives state what the resulting outcome should achieve 3. directive text outlines better design practice guidelines and provide some possible design solutions for achieving the guidelines. The guidelines also provide support in assessing variations of the recommended standards 4. rules of thumb recommend minimum standards as a guide for local decision making. Minimum standards may vary depending on local context issues and/or if development applicants are able to demonstrate that they have addressed the better design practice guidelines and achieved the stated objectives." (emphasis in original)
5. This passage was located adjacent to a representative template which designated the areas that corresponded to "1", "2", "3" and "4" in the passage.
6. The "information sheet" relevant to claim 4 is found within "Part 03" ("Building Configuration") and concerned "Apartment Layout". Within the area corresponding to "3" in the above passage, i.e. "directive text outlin[ing] better design practice guidelines", there are a series of guidelines and plans for nine apartment types ranging from studio apartment to a three bedroom apartment. There was also to be found the following table and text: Apartment type Area m2 03.01 Studio Internal area 38.5 m2 External area 6m2 03.02 One bedroom Internal area 50m2 cross through External area 8m2 03.03 One bedroom Internal area 62m2 maisonette/loft External area 9.4m2 03.04 One bedroom Internal area 63.4m2 single aspect External area 10m2 03.05 Two bedroom Internal area 80m2 corner External Area 11m2 03.06 Two bedroom Internal Area 89m2 cross through External Area 21m2 03.07 Two bedroom Internal Area 90m2 cross-over External Area 16m2 03.08 Two bedroom Internal Area 121m2 corner with study External Area 33m2 03.09 Three bedroom Internal Area 124m2 External Area 24m2

This table and the accompanying illustrations provide information on a variety of unit types. Dimensions, areas and furniture layouts are included. These examples are a comparative tool for recognising well-organised, functional and high quality apartment layouts.

1. The numbers "03.01", "03.02" etc. in this table corresponded with the nine apartment types.
2. The section of the information sheet corresponding to "[4]" (in the passage extracted at [127]), i.e. "rules of thumb", stated as follows: "Rules of Thumb Single-aspect apartments should be limited in depth to 8 metres from a window. The back of a kitchen should be no more than 8 metres from a window. The width of cross-over or cross-through apartments over 15 metres deep should be 4 metres or greater to avoid deep narrow apartment layouts. Buildings not meeting the minimum standards listed above, must demonstrate how satisfactory daylighting and natural ventilation can be achieved, particularly in relation to habitable rooms (see Daylight Access and Natural Ventilation). If council chooses to standardise apartment sizes, a range of sizes that do not exclude affordable housing should be used. As a guide the Affordable Housing Service suggest the following minimum apartment sizes, which can contribute to housing affordability: (apartment size is only one factor influencing affordability) 1 bedroom apartment 50m2 2 bedroom apartment 70m2 3 bedroom apartment 95m2"

"Compliance" with the RFDC

1. Before addressing the matters raised by the Council it is appropriate to note the evidence concerning the extent to which the approved plans conformed with the competing versions of what the parties contended are the "[u]nit size… requirements" of the RFDC, as referred to in condition B2(a) of the Approval.
2. The Council read an affidavit of Gilead Chi-Li Chen, a senior strategic planner. I explained the structure and scope of his affidavit in Botany Bay City Council v Minister for Planning and Infrastructure & Ors (No 2) [2014] NSWLEC 101. The affidavit sought to prove how many of the apartments depicted in the approved plans conformed with the RDFC. Consistent with the arguments put on behalf of the Council, Mr Chen assumed that compliance with the "requirements" of the RDFC meant compliance with the apartment sizes listed in the table set out in [129]. To determine this Mr Chen cross referenced the apartments in the approved plans against the nine apartment types and then determined whether the size of the apartments in the approved plan were equal to or exceeded the areas listed in the table. Mr Chen accepted that not all of the apartments in the approved plans were capable of being "easily categorised" within the nine apartment types, however he explained the basis upon which he did so. In summary, Mr Chen concluded that, of the 405 apartments listed in the approved plans, 130 "complied" with the RFDC, 260 did not and another 15 could not be categorised (including one four bedroom apartment).
3. One criticism by the Respondents of this approach was the degree of subjective assessment undertaken by Mr Chen in categorising the apartments in the approved plans by reference to the nine apartments types. To counter this, the Council provided the Court with a submission that broke down the number of allegedly non compliant apartments. It asserted that the number of non compliant units which are "easily categorised" was 108, that the number of two bedroom apartments which are "not easily categorised" but which were less than 80m2 was 12 and that there were 44 "not easily categorised" one bedroom apartments which were less than 64.3m2. Eighty square metres and 64.3m2 are the lowest internal areas for any configuration of two bedroom and one bedroom apartments listed in the table in [129] respectively. Hence the Council submitted that, on the most conservative approach possible to categorisation, at least 164 of the 405 apartments did not comply with the RFDC.
4. Having regard to this material I accept that the plans for at least 164 of the 405 apartments in the approved plans depict apartments of a size less than an internal area of 80m2 or 63.4m2 depending on whether the apartment has two or one bedrooms. Whether condition B2(a) requires their size to be amended is a different matter to which I will return.
5. As I will explain the Respondents contend that the relevant "requirement" is the minimum unit sizes referred to in the last of the rules of thumb noted in [131]. They referred to the discussion of unit sizes in the Director-General's report extracted at [52] as demonstrating the extent of compliance by the approved plans with the RFDC. That discussion referred to the "RFDC Rules of thumb". At least for one bedroom, two bedroom and three bedroom apartments the relevant minimum areas were derived from the RFDC's rules of thumb being 50m2, 70m2 and 95m2 respectively. The analysis in the Director-General's report identified 52 two bedroom units as non compliant, of which 36 were 1m2 below the "minimum suggested area" (70m2), another 8 were 2m2 below and the other 8 were 3m2 below. Leaving aside the status of the nominated figure for the "minimum suggested area", I accept that analysis as accurate.
6. In Botany Bay City Council v Minister for Planning and Infrastructure [2014] NSWCA 141 at [20] the Court of Appeal observed that it was a "self-evident proposition, not requiring expert evidence, that so far as the non-compliant units needed to be redesigned to meet the minimum unit sizes in the [RFDC] this might be achieved in a number and variety of ways". It follows that it is not possible to assess in any detail the extent to which compliance with that condition will alter the parameters of the residential component of the Project as depicted in the approved plans. However some brief observations can be made. Condition A1 caps the number of units at 405 and the envelope of the residential component is not affected by condition B2(a). Given these constraints it seems likely that compliance with the Council's suggested construction of condition B2(a) will lead to a not insubstantial decrease in the number of apartments. Another possibility is that the number of apartments remains the same or similar but there is a change in the mix of the apartments towards single bedrooms and studio bedrooms.
7. In its written submissions the Council contended that compliance with its construction of Condition B2(a) "will, in the usual course, result in a project which is materially different to that which was approved by the PAC" (Council subs at [79]). I do not accept that contention. The project that was approved by the PAC was one that included condition B2(a) and thus contemplated either a likely reduction in the number of apartments, a change in the apartment mix or a combination of both.
8. If the Council mean to contend that the effect of condition B2(a) is that the Project as depicted in the approved plans is likely to be "materially different" to the Project as ultimately constructed then that only begs the question as to what the Council meant by a "material difference" and its legal significance. I understand the Council's reference to "material difference" to be a paraphrase of "significantly altering the development" which appears to be the test for an invalid condition in a development consent granted under Part 4 (per Basten JA in Kindimindi Investments Pty Ltd v Lane Cove Council (2006) 143 LGERA 277; [2006] NSWCA 23 at [54] per Basten JA ("Kindimindi")). I note the potential relevance of this aspect of Kindimindi to this matter below. However assuming it is applicable, an "evaluative judgement" is still required (Kindimindi). As noted there is a cap on the number of apartments and the available envelope for residential development will not alter. While compliance may lead to a not insignificant reduction in the number of apartments or a change in the apartments mix, or both, I do not accept that there would be a significant alteration to the approved plans.
9. For the sake of completeness I note that, if the Respondents' construction is correct, then I expect that the making of amendments to comply with condition B2(a) is only likely to result in a relatively minimal reduction of the number of apartments. In oral argument Senior Counsel for the Council conceded that on this construction "[t]here are a few that fail to comply but not a large number" (T16).

Uncertainty and the Preferred Construction of Condition B2(a)

1. APOC [26A] pleads that the meaning of condition B2(a) is "uncertain or imprecise" and this has a number of consequences, any one of which was said to result in the condition and presumably the Approval being invalid. These contentions were refined in the Council's written submissions (Council subs at [100ff]). I will address them after having considered the claim of uncertainty and imprecision.
2. In Ulan Coal Mines v Minister Planning & Anor (2008) 160 LGERA 20 at [49] to [50] Preston J (as his Honour then was) noted that there was no common law principle to the effect that an exercise of a statutory power must be certain in order to be valid. Instead the condition (and any approval to which it relates) will only be invalid if it falls outside the class of conditions which the statute expressly or impliedly permits. However in Coffs Harbour City Council v The Minister for Planning and Infrastructure (2013) 193 LGERA 203; [2013] NSWCA 44 at [68] his Honour (Ward JA and Tobias AJA agreeing) identified an anterior inquiry namely that the Courts first "attempt to avoid ambiguity or uncertainty by adopting a construction which gives statutory instruments and decisions practical effect" before inquiring as to whether the governing statute expressly or impliedly requires certainty in instruments or approvals made under it.
3. I have already noted the competing contentions as to the proper construction of condition B2(a). The Approval, including condition B2(a), is not to be construed having regard to either the documents that accompanied it or correspondence or reports that preceded it unless they are "incorporated expressly or by necessary implication" (Winn v Director-General of National Parks and Wildlife & Ors [2001] NSWCA 17 at [2] per Spigelman CJ). In the case of condition B2(a) that clearly extends to the RFDC. It is appropriate to consider it first.
4. It was unfortunate that the condition B2(a) used the phrase "requirements of the [RFDC]". As noted the RFDC does not of itself have the force of law. Moreover the language of the entire document is anything but prescriptive. Thus the RFDC refers to the table in [129] and the apartment designs as merely "provid[ing] information" and as being only "examples" for use as a "comparative tool". They are said to be useful for "recognising well-organised, functional and high quality apartment layouts". It does not purport to suggest that the apartment types are mandatory or that the apartment areas listed represent some minimum standard. This is only reinforced by the introductory section of the RFDC noted in [127] which describes the "directive text", being the area that includes the table noted in [129], as only "outlin[ing] better design practice guidelines and provide[ing] some possible design solutions for achieving the guidelines." The areas listed in the table noted in [129] simply cannot be described as "[u]nit size requirements".
5. In general parlance "rules of thumb" do not constitute "requirements". Instead they are guidelines that lack exactitude. Further the apartment areas listed in the last dot point in [131] are described as able to be used "as a guide" and the areas are 'suggest[ed]" to be used. However they are far more easily characterised as "requirements" than the table noted in [129]. They are at least described as being "rules" (albeit "rules of thumb") and are referred to as "minimum apartment sizes" (albeit to be used "as a guide"). Further the rules use more exhortatory language than the descriptive text in that they advise what "should be" done, as opposed to merely "provid[ing] information" and listing "examples" for use as a "comparative tool". To some extent the description of the "rules of thumb" in [127] support this in that they reiterate their role in recommending "minimum standards" albeit as a "guide for local decision making."
6. The Council noted that the EAR, the PPR and the letter of 8 May 2013 and its attachments are referred to in the Approval (see [62]). Relying on Winn the Council sought to construe condition B2(a) by reference to the discussion of the RFDC in those documents. These documents were only incorporated by stating that the "development shall be undertaken generally in accordance with…". I am doubtful that form of incorporation has the result that recourse can be had to them to resolve some ambiguity in a specific condition such as B2 as though they were secondary materials able to be considered in construing legislation (cf Interpretation Act 1987 (NSW), s 34). However it is not necessary to resolve that doubt.
7. In its written submissions the Council pointed to four matters arising out of these documents as supporting its contention that condition B2(a) was referring to the areas listed in the table at [129] (Council subs at [58]). The first was that, in so far as the EAR addressed unit sizes, they were said to be those found in the table at [129]. This is a reference to those parts of the EAR referred to in [28] above. Those extracts do not support the Council's construction. The table in the EAR did assess the proposed unit sizes against the table in [129]. It described them as "building design provisions" and wrongly described some of them as "rules of thumb". However that table is consistent with using that part of the RFDC as a "comparative tool" and does not support the suggestion that condition B2(a) was referring to the table in [129] as laying down "requirements".
8. Second, the Council submitted that "so far as the PPR addressed non-compliance with the RFDC, it was addressing questions of non compliance [with the table in [129]] that were identified in the Director-General's letter of 24 October 2012." This is a reference to the matter raised by the Director-General in that letter (see [34]) and the response in the PPR noted at [37ff]. I doubt that recourse can be had to the letter of 24 October 2012 for the purpose of construing the Approval, but it does not matter. Nothing in that exchange supports the Council's preferred construction of condition B2(a). In particular, the PPR was responding to a suggestion that the Project did not conform with the sizes listed in the table at [129] by pointing to the minimum apartment sizes in the "rules of thumb" as to what the proponents had had regard to. If anything this provides (mild) support for the contention that they are the relevant minimum standard or requirements.
9. Third, the Council referred to the letter of 8 May 2013 and asserted that the letter distinguished between "the requirements of the RFDC - a reference to the table [in [129]] - and the requirements of the Affordable Housing [SEPP] - a reference to the table [in [131]] - ie the rules of thumb" (emphasis added). The Council contended that the Approval "uses the former language, not the latter".
10. This contention refers to those parts of the letter of 8 May 2013 that are discussed at [43] to [44]. The Council is correct in contending that the extract at [43] refers to the table in [129] but the letter does not refer to those unit sizes as "requirements". Instead, it described them as "suggested minimum sizes" and pointed out the limitations on their use, namely that they concerned specific apartment types which were not adopted for the Project. The letter then sought to defend the apartment sizes proposed for the Project by reference to its degree of compliance with what was "specified in the Affordable Housing SEPP" (see [44]) which appears to be a reference to the rules of thumb. Thus, if anything, resort to the letter of 8 May 2013 supports the Respondents' suggested construction.
11. Fourth, the Council contended its correspondence dated 17 August 2012 and 28 September 2012 were "associated documents and reports" to the PPR and thus could be considered in construing the Approval (Council subs at footnote 7). It further contended that they reflected a construction of the RFDC that treated the table in [129] as establishing "requirements" (Council subs at [58(d)]). I accept that the Council's correspondence reflected its position that to comply with SEPP 65 and the RFDC it was necessary to meet the external and internal areas listed in the table at [129]. However this only illustrates that what occurred throughout the course of the Approval process was a dialogue of the deaf over the RFDC. On the one hand, the Council was continually pointing to the areas listed in the table at [129] and asserting there was non-compliance by the proponents. On the other hand, the proponents were contending that neither the table at [129] nor the nine apartment types were prescriptive. Instead, they were justifying the apartment plans by reference to the design principles in SEPP 65 and the unit sizes listed in the rules of thumb. I do not accept that the Council's correspondence can be considered in construing the Approval. However, even if it could, it only reveals a lack of consensus between the Council and the proponents as to what the "requirements" of the RFDC were.
12. All this leads back to the terms of the Approval and the RFDC. APOC [26A] postulates three possible constructions of what is meant by the "[u]nit size … requirements of the [RFDC]" in condition B2(a). The first is the Council's preferred construction namely that it is a reference to the table at [129]. For the reasons noted at [144], I reject that contention. The third is the light and air requirements listed in the first three dot points in the extract set out in [131]. While I accept that, on its proper construction, the rules of thumb are the relevant "requirements" of the RFDC referred to in condition B2(a) I do not accept that those matters relate to "unit size". The second suggested construction is that propounded by the Respondents namely that the "[u]nit size… requirements" of the [RFDC] are the "minimum apartment sizes" referred to in the last dot point in the extract set out in [131]. While it is somewhat inapt to refer to them as "requirements", for the reasons given in [145] I accept that contention.
13. It follows that I reject the contention in APOC [26A] concerning the invalidity of condition B2(a) and the Approval by reason of the supposed uncertainty as to the meaning of condition B2(a). Although condition B2(a) was unfortunately drafted its meaning is not uncertain in any relevant sense.

Council's Contentions

1. The Council's written submissions made five submissions concerning condition B2(a) (Council subs at [100ff]). The first was that the implementation of condition B2(a) meant that there was a "real possibility" that a "significantly different project [would] result"; and thus the PAC did not "approve the carrying out of the project". The second was that by vesting power in the Director-General to approve amended plans, condition B2(a) "in substance [invalidly] delegated power to approve the development to the Director-General". The third was that because of its capacity to lead to a significant alteration of the Project, condition B2(a) was not authorised by s75J(4).
2. The Council's written submissions made it clear that each of these contentions was predicated upon an acceptance of its proposed construction of B2(a) (Council subs at [100]). As I have not accepted the Council's submission concerning the proper construction of condition B2(a), it follows that the premise of each of these three submissions is not made out and they must be rejected. It follows from the finding in [140] that, on its proper construction, condition B2(a) only requires a minimal reconsideration of the design of the apartments proposed to be built for the Project. It further follows from the finding in [139] that, even if I preferred the Council's construction of condition B2(a), then the same result would follow.
3. The Council's fourth submission reflects [26A] of the APOC namely that condition B2(a) was relevantly imprecise and thus its "practical effect" was that "Director General is called on to select one or other of the meanings, each with enormously different consequences" and the EPAA "did not authorise that outcome" (Council's subs at [105]). This contention should be rejected for the reasons I have already given. No discretion is vested in the Director-General to select his or her own interpretation of condition B2(a). Its meaning is pronounced in [152] above.
4. These conclusions mean that it is not necessary to resolve the Respondents' submissions to the effect that, even if the Council's preferred construction of condition B2(a) was accepted and if it was also accepted that if it would or could lead to a significantly altered Project to that depicted in the approved plans or if condition B2(a) was relevantly imprecise, then that would still not result in either the condition or the Approval being held invalid. However I will briefly note them.
5. The Council's submissions in support of its contentions on this claim placed particular reliance on the proposition encapsulated by the statement of Basten JA in Kindimindi at [54] that "the imposition of a condition which has the effect of significantly altering the development, will invalidate the consent because the development consented to is not that for which approval was sought". Further the interrelationship between the Council's contention as to the effect of condition B2(a) and its superficially inconsistent contention that it was relevantly imprecise or uncertain is best encapsulated by the following passage in GPT Re Limited v Belmorgan Property Development Pty Ltd [2008] NSWCA 256 at [48] (per Basten JA): "Questions of finality and uncertainty will often be related, but are likely to bear upon the same question as that addressed in the first category discussed in Mison. In each respect the question must be whether a consent has been given to the development which was the subject of the application. Where conditions give rise to uncertainty, the fact that it is not possible to know whether the satisfaction of the conditions will give rise to a significantly different development may demonstrate that the consent is not a final and valid consent to the development as proposed. A degree of "practical flexibility" is likely to be necessary, especially in respect of complex developments: see Scott v Wollongong City Council (1992) 75 LGRA 112 at 118 (Samuels AP). Where a condition requires variations which can be checked and approved by a council officer, by reference to prescribed criteria, it may readily be said that the consent is sufficiently final and certain. Where the criteria for future assessment are imprecise or unspecified, there may be an effective delegation of authority to the officer to exercise his or her judgment: if the delegation is not in itself a valid means of disposing of the application, the result will be invalid. On the other hand, if the delegation is valid, it may suggest that the consent purportedly given by the Council is not itself a valid consent."
6. The Respondents correctly noted that these propositions were enunciated in the context of approvals under Part 4 of the EPAA (see Mison v Randwick Municipal Council (1991) 23 NSWLR 734) whereas this case concerned Part 3A. They submitted that a number of features of Part 3A warrants a rejection of the application of the above principles to approvals under Part 4 namely the scale of the projects likely to be considered under Part 3A, the terms of s 75J and the power to grant modifications conferred by s 75J(4). They further submitted that this was the effect of a number of decisions of this Court including Ulan at [75] to [75], Pittwater Council v Minister for Planning (2011) 184 LGERA 419 at [69]; Coffs Harbour City Council v The Minister for Planning and Infrastructure (2012) 187 LGERA 252 at [74ff]; Barrington- Gloucester-Stroud Preservation Alliance Inc v Minister for Planning and Infrastructure & Another (2012) 194 LGERA 113; [2012] NSWLEC 197 at [74] to [85] . I agree that is the effect of those decisions.
7. The Council appeared to submit that those decisions should not be followed because they were overtaken by the Court of Appeal's decision in Barrick Australia Ltd v Williams (2009) 74 NSWLR 733; NSWCA 275 ("Barrick"). Barrick concerned a challenge to the exercise of the power under s 75W to modify an approval on the basis that it amounted to a "radical transformation" of the original approval. The Court in Barrick held that the assessment of whether the proposed modification of the approval extends beyond the scope of s 75W, is to be made by the Minister and is only reviewable by the court on the established grounds of judicial review for attacking such assessments (at [36] and [38] per Basten JA with whom McColl JA agreed at [1]). Barrick does not support the Council's arguments that the above statements of principle applicable to development consents made under Part 4 are applicable to approvals under Part 3A. To the contrary the observations of Basten JA in Barrick at [23] to [24] suggest the opposite.
8. In the end result, no persuasive reason was put forward by the Council as to why the decisions cited by the Respondents should not be followed and I decline to do so. However, it should be noted nothing in those decisions nor this judgment involves an acceptance that the power to impose conditions conferred by s 75J(4) is unlimited. Given the manner in which the Council presented its case on this claim and the findings I have made rejecting that case it is neither necessary nor appropriate to explore the hypothetical question of what those limits might be.
9. The Council's fifth submission in relation to condition B2(a) is that, if the reference to "[u]nit size ….. requirements" is to the last dot in the passage in [131], then the "PAC has misunderstood the RFDC and in doing so committed an error of law affecting the [Approval]" (emphasis added). This is said to be so because "the minimum apartment sizes" referred to are clearly not "requirements" but only "suggestions" (Council subs at [106]). I have already accepted that the use of the phrase "requirements" when referred to the RFDC in condition B2(a) was inapt. However the difficulty with this contention is that in order for there to be an error of law, some "law" must have been misconstrued or misapplied. As previously noted, the RFDC did not have the force of law. It follows that to misconstrue the RFDC, if that is what the PAC did, is simply not an error of law. Thus this contention fails at the outset.

Unreasonableness

1. APOC [28] contends that it was manifestly unreasonable for the PAC to impose condition B2(a). The Council's written submissions did not address this contention and it was not addressed in oral submissions either. On its face the decision of the PAC to require all apartment sizes to at least satisfy the minimums suggested in the last dot point in the extract in [131] does not appear unreasonable. In the absence of anything being said to the contrary I reject this contention.

Claim 5: The Link Road

1. As noted, the Council appears to have first raised a proposal for a link road between Racecourse Place and St Helena Parade in the context of this Project in July 2013. It was strongly opposed by the proponents (see [55]). Ultimately the PAC approved the Project. Conditions B10 and B11 related to traffic but they are of no present relevance. There were no modifications to Stage 2 to accommodate the link road or any conditions imposed on the Approval requiring or even referring to it.
2. The PAC expressly addressed the issue in its memorandum that accompanied the Approval. It stated: "As mentioned in the earlier part of this report, the Commission explored the option of providing a link between Racecourse Road and St Helena Parade with the proponent in their first meeting. Following discussion with the proponent and the Council, the Commission agreed that this option is not viable at this time for the following reasons: 1. The potential flow-on impact of such a link to the surrounding residential areas, particularly to the south of the site, is untested and may encourage more through traffic; and 2. It would require a redesign of a significant part of the southern site, requiring re-assessment of the proposal. As to the issue of the proposal not having addressed the previous PAC review comments on the traffic, the Commission considers it important to note that the applicable FSR control at the time of the preliminary concept plan was 1:1 and the proposal was to double the density. The recently gazetted Botany Bay LLP 2013 however, allows a FSR of 1:5:1 and the current project application seeks approval of 2.039:1, that is, about 36% over the recommended FSR control. There is a slight reduction in the total retail GFA and the removal of all commercial GFA in the current application. Therefore, the traffic impact from the current application would be different from the earlier concept plan. It should be also noted that the assessment of this application has the benefit of inputs from the Council's traffic consultant, advices from RMS, Sydney Buses and SRDAC. These inputs were not available to the previous PAC review. The latest modifications (10 September 2013) proposed by the proponent will reduce the number of apartments from 428 to 404 and the retail GFA from 15,960m2 to 14,404m2. This will have a corresponding reduction in traffic generation, hence a further reduction in traffic impact. On the evidence, the Commission is satisfied that the traffic issue has been satisfactorily addressed in the assessment report, and through subsequent amendments. It is of the view that the potential impacts can be properly mitigated or adequately managed by the recommended conditions." (emphasis added)
3. APOC [30] and [31] plead that in considering whether to approve the Project under s 75J(1) the PAC considered but decided not to approve it with a modification providing for the inclusion of the link road. APOC [32] pleads that, in doing so, the PAC took into account an irrelevant consideration namely that to require the "modification would require a redesign of [a] significant part of the southern side, requiring reassessment of the project." This is a reference to the first emphasised portion of the above passage.
4. The Council's written submission in support of this claim was as follows: (Council subs at [107]) "The PAC decided not to approve the project subject to the construction of a link road between Racecourse Place because it would require a redesign and reassessment of the Project. In other words, the PAC rejected the condition because it would cause inconvenience in the decision-making process. That cannot have been a permissible consideration. It finds no support in the objects of the EPA Act: to the contrary, those objects all suggest that good decision-making which advances the objects of the Act is preferable to hasty or ill-considered decision-making. Put simply, if the point was a good one, it could not be rejected because it would require further thought. It was an error for the PAC to do otherwise." (emphasis added)
5. This submission mischaracterises the PAC's reasoning. The critical conclusion of the PAC was that potential traffic impacts resulting from the Project could be "properly mitigated or adequately managed by the recommended conditions". The PAC's observation that the inclusion of the link road would require a redesign and reassessment of the southern site was not part of the reasoning that supported that conclusion. Instead it was part of its reasons for deciding not to delay its consideration of whether or not to approve the Project. The other reason was that if it was adopted the link road proposal might result in adverse traffic impacts.
6. The Council's submissions wrongly assumed that the PAC was confronted with a choice between approving the Project as is, or approving it subject to a condition that it be amended by the inclusion of the link road. Instead the PAC considered whether or not to approve the Project or delay any decision while the Project was redesigned and reassessed. The answer to the Council's submission extracted above is that the Council did not think the "point was a good one". Instead the effect of the PAC's findings is that the "point", being the proposal for a link road, was unnecessary to consider further because the Project adequately addressed traffic impacts, to consider it further would only cause delay and, in any event, its adoption might exacerbate any adverse traffic impacts. Contrary to the Applicant's submissions there is nothing in the EPAA which renders that reasoning impermissible.
7. I reject claim 5.

Conclusion

1. As I have rejected all of the Council's claims it follows that the proceedings must be dismissed. I will so order. I will also order the Council to pay the Respondents' costs. If either party seeks to vary that order they should apply within the period allowed for by Uniform Civil Procedure Rule 36.16(3A).
2. Accordingly the Court orders that: 1. The proceedings be dismissed. 2. The Applicant pay the Respondents' costs.

Amendments 12 February 2015 - Altered JA to AJ 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: 12 February 2015