Botany Bay City Council v Parangool Pty Ltd

Botany Bay City Council v Workmate Abrasives Pty Ltd (2004) 138 LGERA 120 Hope v Bathurst City Council (1980) 144 CLR 1 House of Peace Pty Ltd v Bankstown City Council [2000] NSWCA 44; (2000) 48 NSWLR 498 CASES CITED: Minister Administering the Crown Lands Act v Bathurst Local Aboriginal Land Council [2009] NSWCA 138; (2009) 166 LGERA 379 Parangool Pty Ltd v Botany Bay City Council [2009] NSWLEC 1189 Shire of Perth v O'Keefe (1964) 110 CLR 529 Thaina Town (on Goulburn) Pty Ltd v City of Sydney Council [2007] NSWCA 300; (2007) 71 NSWLR 230

APPELLANT: T S Hale SC SOLICITORS: Houston Dearn O'Connor LEGAL REPRESENTATIVES:

RESPONDENT: S A Duggan (barrister) and N M Eastman (barrister) SOLICITORS: Gadens Lawyers

JUDGMENT:

• 10 - IN THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES

BOTANY BAY CITY COUNCIL v PARANGOOL PTY LIMITED [2009] NSWLEC 198

JUDGMENT 1 HIS HONOUR: On 12 June 2007, Parangool Pty Ltd submitted a development application to Botany Bay City Council for "occupation of existing warehouse building for general warehouse use" at Nos. 619-629 Gardeners Road, Mascot. The Council refused the application on 2 October 2008. The principal ground of refusal was that the proposed development is prohibited in the relevant zone. 2 Parangool appealed to the Court. In a decision made on 15 June 2009, Commissioner Murrell upheld the appeal and granted consent to the development application: Parangool Pty Ltd v Botany Bay City Council [2009] NSWLEC 1189. The Council now appeals against the commissioner's decision on the ground that in upholding the appeal the commissioner erred in law. 3 Notwithstanding the fact that a warehouse is a prohibited use in the relevant zone, Parangool relied upon existing use rights. As the commissioner records in her decision, the existing use as a warehouse was approved in August 2002 at a time when the land was zoned Industrial 4(a) under the Botany Local Environmental Plan 1995, under which the use of land for a warehouse or distribution centre was permissible with consent. The August 2002 development consent described the proposed development in the following terms: "Use of existing warehouse building for the warehousing/storage and distribution of alcoholic goods". 4 In October 2002, the land was rezoned to Mixed Uses 10(a) Commercial/Residential, in which zone a warehouse or distribution centre was and is prohibited. 5 The Council contends that the only lawful existing use is that of a warehouse "for the warehousing/storage and distribution of alcoholic goods" and for no other uses, that what the commissioner did was to consent to a change of use to another use, namely a general warehouse use, and in so doing the commissioner erred in law.

The commissioner's decision 6 The salient findings and conclusions of the commissioner are found in pars [42] to [52] of the decision: "[42] It was submitted on behalf of the respondent that the application before the Court for general warehouse use constitutes a 'change of use' and the applicant cannot rely on the existing use rights for warehousing and distribution of alcoholic goods. It was further submitted by the respondent that the proper test is to look at the consent for the previous purpose /use as contained in the consent and this is not a case that requires characterisation of the use because it is described. [43] It was submitted on behalf of the applicant that the task is one of proper characterisation and that the use is not determined on the face of the application and there is no need to descend to that level of the specificity, and that existing rights have been liberally construed in the past. It was further submitted for the applicant that the proposal is not a 'change of use' but a change in nature to a more general use to continue to use the existing premises for the purpose of a warehouse not limited to alcoholic goods. [44] While not directly on point, and the facts in these circumstances differ, the parties referred to the Court to a number of judgements to assist with the existing use rights question. [45] I accept that it is not necessary to carry out a characterisation of the use(s) and that it is informative to refer to the notice of determination for the 2002 wherein the proposed development was described as follows 'use of existing warehouse building for the warehousing/storage and distribution of alcoholic goods'. Similarly, and not in issue, the test is not that there have been warehousing activities on the site for over 40 years but the above use becomes the lawful use for the purposes of existing use rights. In terms of s106 of the Act the above use is a lawful purpose. [46] Section 108 refers to the regulations and of particular relevance to this case is subsection 1(c) ' the enlargement or expansion or intensification of an existing use'. Turning to clause 41 (1)(a) of the Regulations an existing use may 'be enlarged, expanded or intensified'. Clause 42 requires development consent for 'any enlargement, expansion or intensification of an existing use'. Subclause (2) requires this must be for the existing use and no other use and must be carried out only on the land of the existing use. [47] Having regard to the facts in this case with the above construction I am satisfied that the court has power to consider the development application and carry out a merits assessment. [48] I am satisfied that the description of the use in the 2002 consent can be enlarged or expanded by deleting the type of goods that may be stored and distributed, that is alcoholic goods, and that this does not constitute a 'change of use'. But rather an enlargement or expansion because of the increased range of goods that may potentially be stored for warehouse and distribution purposes from the existing premises on the subject site. [49] In my assessment it is only common sense that under existing use rights just because different goods are to be stored and distributed that this would constitute a change of use or a change in the nature of the operation. To illustrate if existing premises were used as a shop for the retail sale of jeans and relied on existing use rights it would be a nonsense to say that the retailing of other articles of clothing would represent a change of use. I am satisfied that the application does not encompass changes in processes, such as from the manufacturing of goods to steel fabrication, but rather the storage of different goods, articles or beverages does not represent a change of use. [50] The descriptor in the 2002 consent of 'use of existing warehouse building for the warehousing/storage and distribution of alcoholic goods' is capable of being extended and expanded to allow the storage/warehousing of other goods under existing use rights, except those excluded by the conditions such as hazardous and dangerous good and recycling materials. I note in the Council's officer's report of 4 October 2006 for an extension of the time limited consent for the site it states: At the time the original consent was granted.. the use of the premises for warehousing and distribution was permissible with the appropriate consent of council. However in October 2002 the site was rezoned… and the use of the premises for warehousing and distribution is now prohibited. Accordingly, it is considered that the use of the premises enjoys existing use rights for this purpose. [51] I have concluded that I have power to assess and determine the development application as enlargement, expansion or intensification and this does not require physical works or alterations. The Court relies on s.108(1)c of the Act and clause cl.41(1)(a) as the source of power. [52] It would be nonsensical to provide such a strict interpretation such that a shop with existing use rights used for the retail sale of shirts with the descriptor in the development application that it could not be enlarged expanded or intensified to also retail other clothing. Such an interpretation/construction would undermine the purpose of the existing use rights provisions." 7 The Council contends that the commissioner erred in law in finding that the Court had the power to approve the development, and in not dismissing the appeal on that basis. 8 Parangool submits, however, that the commissioner correctly held that the proposed development did not involve a change of use and that it was permissible to expand or intensify the use by the storage and distribution of products other than alcoholic goods.

The relevant legislation 9 The key provisions of the Environmental Planning and Assessment Act 1979 are s 106, s 107 and s 108:

(a) the use of a building, work or land for a lawful purpose immediately before the coming into force of an environmental planning instrument which would, but for Division 4A of Part 3 or Division 4 of this Part, have the effect of prohibiting that use, and

(b) the use of a building, work or land: (i) for which development consent was granted before the commencement of a provision of an environmental planning instrument having the effect of prohibiting the use, and ... 107 Continuance of and limitations on existing use

(1) Except where expressly provided in this Act, nothing in this Act or an environmental planning instrument prevents the continuance of an existing use.

(2) Nothing in subsection (1) authorises: (a) any alteration or extension to or rebuilding of a building or work, or

(b) any increase in the area of the use made of a building, work or land from the area actually physically and lawfully used immediately before the coming into operation of the instrument therein mentioned, or

(c) without affecting paragraph (a) or (b), any enlargement or expansion or intensification of an existing use, or

(d) the continuance of the use therein mentioned in breach of any consent in force under this Act in relation to that use or any condition imposed or applicable to that consent or in breach of any condition referred to in section 80A (1) (b), or ...

(1) The regulations may make provision for or with respect to existing use and, in particular, for or with respect to: (a) the carrying out of alterations or extensions to or the rebuilding of a building or work being used for an existing use, and

(b) the change of an existing use to another use, and

(c) the enlargement or expansion or intensification of an existing use.

(d) (Repealed) …" 10 The Environmental Planning and Assessment Regulation 2000 relevantly states: "41 Certain development allowed (1) An existing use may, subject to this Division: (a) be enlarged, expanded or intensified, or ... (d) be changed to another use, but only if that other use is a use that may be carried out with or without development consent under the Act, or

(e) if it is a commercial use - be changed to another commercial use (including a commercial use that would otherwise be prohibited under the Act), or

(f) if it is a light industrial use - be changed to another light industrial use or a commercial use (including a light industrial use or commercial use that would otherwise be prohibited under the Act). (2) However, an existing use must not be changed under subclause (1) (e) or (f) unless that change: ... (e) relates only to premises that have a floor space of less than 1,000 square metres."

It is not in dispute that the subject premises has a floor space of more than 1,000 square metres, so that cl 41(2)(e) of the Regulation cannot apply. 11 Clause 42 of the Regulation is as follows: "42 Development consent required for enlargement, expansion and intensification of existing uses (1) Development consent is required for any enlargement, expansion or intensification of an existing use. (2) The enlargement, expansion or intensification: (a) must be for the existing use and for no other use, and (b) must be carried out only on the land on which the existing use was carried out immediately before the relevant date."

The proposed development amounts to a change of use 12 Ms S A Duggan and Mr N M Eastman, appearing for Parangool, submit that: (a) the commissioner found that the existing use is properly characterised as the use for warehouse/storage of goods; and (b) that genus of use is not limited to alcoholic goods as the Council contends. They submit that this is a finding of fact which does not give rise to an error of law. 13 In submitting that the commissioner's characterisation of the existing use was correct, Ms Duggan relies upon the judgment of Mason P (Stein and Giles JJA concurring) in House of Peace Pty Ltd v Bankstown City Council [2000] NSWCA 44; (2000) 48 NSWLR 498 (inter alia). In that case, the Court of Appeal construes the word "church" in a development consent given in 1954 as a place which was not limited or restricted to Christian liturgy, but authorised any place of public worship, including a mosque. In particular, Mason P applied the well known principle explained in Shire of Perth v O'Keefe (1964) 110 CLR 529 that the classification of an existing use is not to be approached through a meticulous examination of the details of the processes or activities, but asking what, according to ordinary terminology, is the appropriate designation of the purpose. That is, the use must be construed broadly and liberally. It is the town planning purpose that must be borne in mind in construing the purpose, which in the present case is the storage and distribution of goods. 14 I find myself unable to accept the submission. The existing use rights relied upon in the present case are dependent upon the terms of the 2002 development consent: s 107(2)(d). In Botany Bay City Council v Workmate Abrasives Pty Ltd (2004) 138 LGERA 120, the Court of Appeal, (Stein AJA, Spigelman CJ and Cripps AJA concurring), held, at [14], that the genus test is irrelevant to a situation where the existing use is claimed to flow from an existing development consent: "The genus test would be relevant for characterisation, if there was no consent, but there was in this case". It was the particular rights of use granted by the terms of development consent which were protected by s 106. 15 In House of Peace, the development consent for a "church" was not expressly limited to a church for Christian worship - it was thus an easy step for the Court to hold that it was for a general place of public worship. In the present case, however, the terms of the development consent upon which Parangool relies are expressly limited to "the warehousing/storage and distribution of alcoholic goods". It was not a consent for warehousing generally. 16 The commissioner correctly set out the factual and legal position at pars [45] and [46]. The commissioner, however, applied at pars [49] and [52], the genus test explained in Shire of O'Keefe in arriving at her conclusion that she had the power to consent to the application. But since the existing use in the present case was dependent upon the express and limiting terms of the development consent, that test - as explained in the Workmate Abrasives case - is irrelevant. 17 The key finding of fact made by the commissioner is in par [45]: the lawful use for the purpose of existing use rights is the development described as "use of existing warehouse building for the warehousing/storage and distribution of alcoholic goods" and " ...the above use becomes the lawful use for the purposes of existing use rights". That is, the consent expressly limits the lawfulness of the existing use to "the warehousing/storage and distribution of alcoholic goods". A wrong application of the facts to the law is an error of law: Hope v Bathurst City Council (1980) 144 CLR 1 at 7. There was no power in the present case to approve the change of use to warehousing generally. 18 It follows that this appeal must be upheld. The parties agree that, consistently with the judgment of the Court of Appeal in Thaina Town (on Goulburn) Pty Ltd v City of Sydney Council [2007] NSWCA 300; (2007) 71 NSWLR 230; (2007) 156 LGERA 150 per Spigelman CJ at [103] - [108], the Court should dismiss Parangool's appeal under s 97 of the Environmental Planning and Assessment Act. In Minister Administering the Crown Lands Act v Bathurst Local Aboriginal Land Council [2009] NSWCA 138; (2009) 166 LGERA 379, it was held that if the Court finds error in a question of law and on the facts found only one conclusion is open, then the Court has power to make final orders disposing of the proceedings (per Ipp JA at [76], Tobias JA at [167] and Basten JA at [195]). Orders 19 The Court makes the following final orders:

(1) The appeal under s 56A of the Land and Environment Court Act 1979 is upheld and the commissioner's orders are set aside.

(2) The appeal by Parangool Pty Ltd under s 97 of the Environmental Planning and Assessment Act 1979 is dismissed.

(3) The respondent, Parangool Pty Ltd, must pay the costs of the appellant, Botany Bay City Council.

I hereby certify that the preceding 19 paragraphs are a true copy of the reasons for judgment herein of the Honourable Mr Justice D H Lloyd.

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.