Bryan v Lane Cove Council and Anor

KEY ISSUES: Judicial Review :- validity of amendments to local environmental plan - whether amendment altered after public exhibition - whether new plan or altered plan - public exhibition requirements - amendment invalid

Environmental Planning and Assessment Act 1979 LEGISLATION CITED: Environmental Planning and Assessment Amendment (Infrastructure and Other Planning Reform) Act 2005 Lane Cove Local Environmental Plan 1987

John Brown Lenton & Co Pty Ltd v Minister for Urban Affairs and Planning (1999) 106 LGERA 150; Leichhardt Council v Minister for Planning [No 2] (1995) 87 LGERA 78 ; Lesnewski v Mosman Municipal Council (2005) 138 LGERA 207; Maitland City Council v Anambah Homes Pty Ltd (2005) 64 NSWLR 695; North Sydney Council v Michael Standley & Associates Pty Ltd (1998) 43 NSWLR 468 ; Qantas Airways Limited v Aravco Limited (1996) 185 CLR 43 ; CASES CITED: Sydney City Council v Ilenace Pty Ltd [1984] 3 NSWLR 414; Taperell v Randwick City Council (2000) 108 LGERA 309 ; The King v Hickman; Ex parte Fox and Clinton (1945) 70 CLR 598; Transport Action Group Against Motorways Inc v Roads and Traffic Authority (1999) 46 NSWLR 598; Vanmeld Pty Ltd v Fairfield City Council (1999) 46 NSWLR 78 ; VAW (Kurri Kurri) Pty Ltd v Scientific Committee (Established under s 127 of the Threatened Species Conservation Act 1995) (2003) 58 NSWLR 631; Woolworths Ltd v Pallas Newco Pty Ltd (2004) 61 NSWLR 707

APPLICANT Mr T F Robertson SC SOLICITORS Woolf Associates

FIRST RESPONDENT LEGAL REPRESENTATIVES: Mr A Hawkes SOLICITORS Pike Pike & Fenwick

SECOND RESPONDENT Mr P R Clay SOLICITORS Herbert Geer & Rundle

THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES

MINISTER FOR PLANNING Second Respondent

JUDGMENT Jagot J: A. Introduction 1 By an application filed on 23 March 2007 and amended on 24 April 2007 the applicant, Ms Bryan, claimed a declaration that Amendment No 62 to Lane Cove Local Environmental Plan 1987 is invalid.

2 Amendment No 62 is a provision made in reliance on s 28 of the Environmental Planning and Assessment Act 1979 (the EPA Act). It applies to land known as 83 and 85 Kenneth Street, Longueville (lots 1 and 2 in DP 1063151, formerly lot 17 in DP 29396). Under its provisions, and for the purpose of enabling development to be carried out in accordance with the LEP or consent granted in accordance with the EPA Act, any covenant, agreement or similar instrument imposing restrictions as to the erection or use of buildings on that land for certain purposes does not apply to the development, to the extent necessary to serve that purpose.

3 The applicant owns land adjoining 83 and 85 Kenneth Street, Longueville, known as 3 Amalfi Place, Longueville (lot 15 in DP 29396). Covenant H191155, created by transfer registered on 25 May 1959, burdens 83 and 85 Kenneth Street and benefits the balance of the land within DP 29396, including 3 Amalfi Place. The primary provision of this covenant prevents more than one main building being erected on 83 and 85 Kenneth Street. 3 Amalfi Place is subject to the burden of its own covenant, which also benefits the balance of the land within DP 29396, including 83 and 85 Kenneth Street. This covenant, H330434 registered on 4 January 1960, contains the same primary provision as covenant H191155, but also prevents a two storey building from being erected on 3 Amalfi Place.

4 The applicant contended that Amendment No 62 is invalid for the following reasons: (1) Amendment No 62 was never exhibited as required by Div 4 of Pt 3 of the EPA Act. The version of Amendment No 62 that was exhibited would have had the effect of suspending all covenants throughout the Lane Cove local government area, including covenant H330434 that burdens 3 Amalfi Place and benefits, amongst other land, 83 and 85 Kenneth Street. Amendment No 62 as made operates with respect to any covenant burdening 83 and 85 Kenneth Street only. This involved a breach of ss 66 and 67 of the EPA Act.

(2) The applicant was denied procedural fairness with respect to Amendment No 62 in breach of a common law obligation by reason of (1) above, the applicant not being given notice of the proposed making of Amendment No 62, and the detriment to the applicant's property rights caused by the making of that amendment.

(3) The Council had no power to amend draft Amendment No 62 as there had been no public hearing. The power to amend in s 68(3) of the EPA Act only arises after a public hearing.

(4) Alternatively, the Council never in fact or law exercised or purported to exercise the power to alter draft Amendment No 62 under s 68(3) of the EPA Act or otherwise.

(5) Alternatively, the differences between draft Amendment No 62 as exhibited and Amendment No 62 as made were outside the power in s 68(3) of the EPA Act as they involved a transformation of substance so that the instrument as made was of a different character. (6) The Director-General had not complied with s 65(1A) and s 69(2) of the EPA Act with respect to Amendment No 62. These sections relate to the standard instrument provided for in s 33A of the EPA Act (inserted by the Environmental Planning and Assessment Amendment (Infrastructure and Other Planning Reform) Act 2005, Act No 43 of 2005). (7) The Minister failed to take into account a mandatory relevant consideration when making Amendment No 62, being the "detriment suffered by the applicant from the discriminatory effect of" Amendment No 62. (8) Although the proceedings were commenced one day after the expiry of the three month period referred to in s 35 of the EPA Act, the claims in (1) and (2) above involved breach of an "essential", "imperative" or "inviolable" limit or restraint in the EPA Act ( R v Hickman and Others; Ex parte Fox and Clinton (1945) 70 CLR 598, Woolworths Ltd v Pallas Newco Pty Ltd and Another (2004) 61 NSWLR 707, Lesnewski v Mosman Municipal Council (2005) 138 LGERA 207 and Maitland City Council v Anambah Homes Pty Ltd (2005) 64 NSWLR 695). The consequence is that the privative provision does not prevent the applicant from making any of its claims.

5 The respondents conceded that if the changes made to draft Amendment No 62 after its public exhibition were outside the Council's power of alteration in the EPA Act then s 35 would not prevent the applicant's challenge for breach of the public exhibition requirements in s 66. If so, the necessary consequence is that Amendment No 62 would not have been exhibited as required by s 66 and is thereby invalid. The respondents also accepted that the decision of the Court of Appeal in Leichhardt Council v Minister for Planning [No 2] (1995) 87 LGERA 78 accurately identified the principles relevant to resolution of this issue. As explained below, these concessions were properly made in the circumstances. However, the respondents denied that the changes were outside power and otherwise denied the whole of the balance of the applicant's claims, including the applicant's argument about the effect of s 35 on those claims.

B. Facts 6 The facts were within a narrow compass and evident from an agreed bundle of documents.

8 On 10 May 2002 the Council granted development consent authorising the subdivision of lot 17 in DP 29396 (formerly known as 83 Kenneth Street) into two lots, which became lots 1 and 2 in DP 1063151 known as 83 and 85 Kenneth Street. On 2 November 2004 the Council granted development consent authorising the erection of a new dwelling on one of those lots, being lot 2. On 13 December 2005 the Council granted another development consent authorising the erection of a new dwelling on lot 1. However, covenant H191155 prevented the erection of more than one main building on former lot 17 in DP 29396.

9 On 20 February 2006 the Council resolved to prepare a draft local environmental plan under s 54 of the EPA Act applying to 83 and 85 Kenneth Street, the effect of which would be that covenants burdening that land would not apply to the extent necessary to enable development to be carried out. The Council informed the Department of Planning about its resolution. On 30 March 2006, the Director-General refused authority for the Council to use the delegation from the Director-General to issue a certificate under s 65 certifying that the draft plan may be publicly exhibited in accordance with s 66. The Director-General advised the Council that he would be willing to consider giving that authority with respect to a draft instrument suspending covenants generally throughout the local government area.

10 On 3 April 2006 the Council made another resolution under s 54 of the EPA Act to make a draft local environmental plan empowering the Council to "determine that any covenant, agreement or similar instrument imposing restrictions as to the development on, or use of, the land to which the consent applies, to the extent necessary to serve that purpose, shall not apply to that development". This draft instrument applied to "the Lane Cove Municipality". Whether such a provision would have been authorised by s 28 of the EPA Act is not at issue in these proceedings. The Council notified the Department of Planning of its resolution on 5 April 2006. The Director-General gave the required authorisation enabling the Council to exercise the delegation to issue a certificate under s 65 with respect to this draft local environmental plan (draft Amendment No 62). On 26 May 2006 the Council's General Manager issued a certificate under s 65 of the EPA Act certifying that draft Amendment No 62 may be publicly exhibited in accordance with s 66 of the EPA Act. Draft Amendment No 62 was publicly exhibited as required by s 66 of the EPA Act between 26 May and 23 June 2006. The substantive provisions of draft Amendment No 62 as exhibited were as follows: (1) This plan applies to the Lane Cove Municipality. (2) For the purpose of enabling development to be carried out in accordance with a consent granted under the Environmental Planning and Assessment Act 1979, Council may determine that any covenant, agreement or similar instrument imposing restrictions as to the development on, or use of, the land to which the consent applies, to the extent necessary to serve that purpose, shall not apply to that development. (3) Nothing in subclause (2) shall affect the rights or interests of any statutory authority under any registered instrument. (4) Pursuant to section 28 of the Act, before the making of this plan the Governor approved of subclauses (2) and (3).

11 The Council received 34 submissions during the public exhibition, including a submission on behalf of the applicant. A report to the Council on 7 August 2006 recorded that there was a widespread view in the community that restrictive covenants remained relevant and were supported. Given that the Council did not want a general power to suspend such covenants the report recommended the Council notify the Department of Planning that it did not support the generic clause being included in the LEP and request the Department "to proceed with the original form of the draft LEP to suspend covenants affecting 83 Kenneth Street (formally Lot 17, DP 29396) only". The Council so resolved.

12 On 17 August 2006 the Council again wrote to the Department of Planning. It requested the Department review its former position and provide authority for the Council to exercise delegation to issue a certificate under s 65 to enable the original version of draft Amendment No 62, applying only to 83 and 85 Kenneth Street, to be publicly exhibited. The Department advised the Council that the most expeditious option would be to alter draft Amendment No 62 as publicly exhibited under s 68(3) of the EPA Act. In the meantime, the applicant, through her solicitor and attorney, made representations to the Director-General to reject any amendment with respect to covenants burdening 83 and 85 Kenneth Street. On 3 October 2006 the Director-General confirmed in writing the Department's advice that the most expeditious approach would be for the Council to alter draft Amendment No 62 as exhibited and submit a report under s 68(4) of the EPA Act with respect to the altered draft.

13 The Council prepared and submitted a report under s 68(4) of the EPA Act. This report referred to the Council's resolution of 7 August 2006 and said that, thereby, the Council had resolved to alter draft Amendment No 62 as exhibited so that it applied to 83 and 85 Kenneth Street only. On 13 December 2006 the Director-General prepared a report under s 69 to the Minister recommending that draft Amendment No 62 (as altered) be made. This report recorded that: The changes to the plan are not considered to be significant. The change has narrowed the application of the clause to a specific site. The generic suspension of covenants would have had the same effect on 83 & 85 Kenneth Street and any surrounding properties as the site specific suspension, therefore it is not considered that the changes warrant re-exhibition. 14 On 14 December 2006 the Minister made Amendment No 62. This instrument was published in the NSW Government Gazette on 22 December 2006. Although the Minister also altered Amendment No 62 as made under s 70(8) of the EPA Act, it was common ground that this alteration was minor and of no significance to the applicant's claims. Amendment No 62 as made inserts cl 17D into the LEP as contemplated by s 28 of the EPA Act, in the following terms: (1) This clause applies to Lots 1 and 2, DP 1063151 (formerly comprising Lot 17, DP 29396), known respectively as Nos 83 and 85 Kenneth Street, Longueville. (2) For the purpose of enabling development to be carried out in accordance with this plan (as in force at the time the development is carried out) or in accordance with a consent granted under the Act, any covenant, agreement or similar instrument imposing restrictions as to the erection or use of buildings on land to which this clause applies for certain purposes or as to the use of such land for certain purposes, to the extent necessary to serve that purpose, shall not apply to that development. (3) Nothing in subclause (2) shall affect the rights or interests of any statutory authority under any registered instrument. (4) Pursuant to section 28 of the Act, before the making of this plan the Governor approved of subclauses (2) and (3).

15 The applicant commenced the Class 4 proceedings on 23 March 2007, one day after expiry of the three month period specified in s 35. 16 The applicant called other evidence in the proceedings being: - (i) an affidavit of Mr Robert Chambers, town planner, setting out his opinion as to the difference between draft Amendment No 62 as publicly exhibited and as made from a town planning perspective, (ii) an affidavit of Mr Peter Dempsey, a valuer, setting out his opinion of the impact of the two versions of Amendment No 62 on the value of 3 Amalfi Place, and (iii) an affidavit of Mr Anthony Bryan, the applicant's son, identifying the steps he would have taken on his mother's behalf if Amendment No 62 as made had been publicly exhibited. In particular, Mr Bryan, his sister and mother had been "equivocal" about draft Amendment No 62 as exhibited because it would have applied equally to 3 Amalfi Place. They opposed Amendment No 62 as made, which suspended the covenant that burdened 83 and 85 Kenneth Street and benefited 3 Amalfi Place, whilst leaving the covenant that burdened 3 Amalfi Place and benefited 83 and 85 Kenneth Street in force. C. Decision 17 Although Div 4 of Pt 3 of the EPA Act has been amended over the years, the statutory scheme for the preparation, exhibition and making of local environmental plans remains clear. Spigelman CJ identified the statutory sequence in Vanmeld Pty Ltd v Fairfield City Council (1999) 46 NSWLR 78 at [23]. The fact that Spigelman CJ was in dissent in the result does not affect the usefulness of that summary. Subsequent to Vanmeld, the concept of "standard instruments" was introduced by the Environmental Planning and Assessment Amendment (Infrastructure and Other Planning Reform) Act 2005 (s 33A in particular) which has led to consequential amendments by inclusion of s 65(1A) (a s 65 certificate shall not be issued unless the Director-General is satisfied that the draft local environmental plan has been prepared in accordance with any applicable standard instrument under s 33A), s 74A (the powers in Div 5 of Pt 3 to review and amend instruments are subject to ss 33A and 33B), cl 92 to Sch 6 to the EPA Act (a form of savings and transitional provision for the operation of s 65(1A) and s 69(2)) and changes to s 69(2) (the Director-General is not to furnish a report to the Minister unless satisfied that the draft local environmental plan has been prepared in accordance with any applicable standard instrument under s 33A).

18 Insofar as relevant to the resolution of this matter, key provisions within the statutory scheme are as follows: 35 The validity of an environmental planning instrument shall not be questioned in any legal proceedings except those commenced in the Court by any person within 3 months of the date of its publication in the Gazette.

… 54 (1) A council may decide to prepare a draft local environmental plan in respect of the whole or any part of the land within its area. …

65 (1) Where the Director-General receives a copy of a draft local environmental plan from a council under section 64, the Director-General may cause to be issued to the council a certificate certifying that the draft plan may be publicly exhibited in accordance with section 66. (1A) …. … 66 (1) Where a council receives a certificate under section 65 with respect to a draft local environmental plan, it shall, after complying with any condition subject to which the certificate was granted and subject to the regulations: (a) give public notice, in a form and manner determined by the council, of the place at which, the dates on which, and the times during which, the environmental study prepared by the council under section 57 of the land to which the draft local environmental plan applies and the draft local environmental plan may be inspected by the public, (b) publicly exhibit at the place, on the dates and during the times set out in the notice: (i) a copy of that environmental study and draft local environmental plan, (ii) a copy of any standard instrument, environmental planning instrument or direction under section 117 that substantially governs the content and operation of the draft local environmental plan (or provide for access to such a copy), and (iii) a statement to the effect that any such standard instrument, environmental planning instrument or direction substantially governs the content and operation of the draft local environmental plan and that any submissions made pursuant to section 67 should be made having regard to that fact, (c) … (2) A draft local environmental plan shall be publicly exhibited for a period being not less than the prescribed period. … 67 Any person may, during the period referred to in section 66 (1) (c), make submissions in writing to the council with respect to the provisions of a draft local environmental plan publicly exhibited under section 66 (1) (b). 68 (1) Where: (a) a person making a submission so requests, and (b) the council considers that the issues raised in a submission are of such significance that they should be the subject of a hearing before the council decides whether and, if so, what alterations should be made, the council shall, in the prescribed manner, arrange a public hearing in respect of the submission. (2) A report of the public hearing shall be furnished to the council and the council shall make public the report. (3) The council shall consider the submission and the report furnished pursuant to subsection (2) and may make any alterations it considers are necessary to the draft local environmental plan arising from its consideration of submissions or matters raised at any public hearing. (3A) An alteration made by a council pursuant to subsection (3) need not relate to a submission. (3B) The council may (but need not) give public notice of and publicly exhibit, wholly or in part, a draft local environmental plan that has been altered pursuant to subsection (3). The provisions of this section and sections 66 and 67, with any necessary adaptations, apply to any such exhibition of a draft plan, but not so as to require a further certificate under section 65. (4) The council shall, subject to and except as may be provided by the regulations, submit to the Director-General: (a) details of all submissions, (b) the report of any public hearing, (c) the draft local environmental plan and the reasons for any alterations made to the plan pursuant to subsection (3), and (d) a statement: (i) to the effect that the provisions of sections 66 and 67 and this section relating to public involvement in the preparation of the draft plan have been complied with, (ii) specifying the environmental planning instruments and directions under section 117 that have been taken into consideration, (iii) giving details of any inconsistency between the draft plan and any instrument or direction referred to in subparagraph (ii) and the reasons justifying the inconsistency, and (iv) giving details of the reasons justifying the exclusion of provisions of the draft plan under subsection (5) or the exclusion from the application of the draft plan of any land under that subsection. (5) In submitting the draft local environmental plan, the council may exclude certain provisions of the draft plan or exclude part of the land from the draft plan, or both (in this section referred to as the deferred matter) which, in its opinion, require or requires further consideration but which should not prejudice the consideration by the Director-General and the Minister of the draft plan as submitted. (6) The council may subsequently take action under this section in respect of the deferred matter, without having to publicly re-exhibit that deferred matter, as if it were a draft local environmental plan. (7) More than one public hearing may be held in respect of any submissions, and one hearing may be held in respect of more than one submission. (8) The regulations may make provision for or with respect to the conduct of a public hearing. (9) After a draft local environmental plan has been submitted to the Director-General under this section: (a) the council and the Director-General may (on one or more occasions) agree to the council making changes to the draft plan and resubmitting it under this section, or (b) the Director-General may (on one or more occasions) return the draft plan so that the council can make changes to accord with any applicable standard instrument under section 33A or to take into account any directions under section 117. This subsection applies whether or not a report under section 69 has been furnished in respect of the draft plan. 19 Given the concessions of the respondents recorded in [5] above, it is convenient to deal with the alleged breach of the public exhibition requirement in s 66 first.

20 Leichhardt Council v Minister for Planning [No 2] concerned the making of a regional environmental plan under Div 3 of Pt 3 of the EPA Act. Cole JA recorded the relevant statutory provisions at 97-100. These provisions included a requirement for public exhibition (s 47) and a power to amend a draft regional environmental plan after exhibition (s 49) as follows: 49.(1) The Director shall cause any submissions made under section 48 to be considered and - (a) may, if he thinks fit, direct that an inquiry be held, in accordance with section 19, by a Commission of Inquiry appointed under section 119(2), with respect to any matter relating to the draft regional environmental plan whether or not arising from any submission; (b) may amend the draft regional environmental plan whether or not as a consequence of the consideration of any such submissions or of the findings of and recommendations of any such Commission of Inquiry; (c) may, if he thinks fit, publicly exhibit that amended draft regional environmental plan together with a written explanation of the reasons for the amendments, at such places, on such dates and during such times as he determines; and …

21 It will be apparent that regional environmental plans, in common with local environmental plans, must be publicly exhibited. The one class of instrument not subject to this public exhibition requirement is State environmental planning policies (see Div 2 of Pt 3 of the EPA Act). Under s 49 the Director-General may amend a draft regional environmental plan and may, if the Director-General thinks fit, publicly exhibit that amended draft regional environmental plan. Under s 68(3) to (3B) a council may make any alterations it considers are necessary to a draft local environmental plan arising from its consideration of submissions or matters raised at any public hearing even though the alteration need not relate to any submission and may (but need not) give public notice of and publicly exhibit, wholly or in part, a draft local environmental plan that has been altered. The similarity of these provisions, despite the power being one of "alteration" with respect to local environmental plans and "to amend" with respect to regional environmental plans, caused the respondents to accept that the principles in Leichhardt Council v Minister for Planning [No 2] applied and could not relevantly be distinguished. The respondents' concessions were thus consistent with the approach to local environmental plans in Vanmeld (at [48] and [184]), John Brown Lenton & Co Pty Ltd v Minister for Urban Affairs and Planning and Ors (1999) 106 LGERA 150 and Taperell v Randwick City Council (2000) 108 LGERA 309 (which concerned a development control plan). They were also consistent with the fact that the majority in Leichhardt Council v Minister for Planning [No 2] use "amend" interchangeably with "alter" (for example, at 84).

22 In Leichhardt Council v Minister for Planning [No 2] Priestley JA, with whom Sheller JA agreed, said that it was necessary to compare the publicly exhibited draft plan with the plan made by the Minister "to see what the differences are between them, and how important they are" (at 84). The draft plan as exhibited in that case contained a provision relating to development exceeding building heights prescribed by another existing clause in the applicable LEP. The provision, amongst other things, referred to such development being permitted if, in the opinion of the consent authority, the building heights were consistent with height limits set down within any draft development control plan. It was common ground that such a development control plan had been exhibited together with the draft plan (at 85). The plan as made contained a provision that a building could be erected in excess of the heights prescribed in the existing clause within the LEP. Priestley JA characterised these differences as "stark" (at 86). The exhibited draft contained a control of building heights by reference to development control plans. The plan as made contained no building height restrictions. This was a "significant difference" and "quite a different situation" in terms of the operation of the plan (at 87). The plan as made would seem to a developer "quite a different plan" (at 88). The test contended for by the Council was "much more in line with the evident purpose of Pt 3 div 3 than the test proposed by the Minister", which would make the process "dependent on how much notice the Minister was prepared to take of it" (at 88). The Council's test was that the power of amendment could not extend to a "difference of such significance that the plan made by the Minister could not be said to be an outcome of the Pt 3 div 3 process" (at 84). The Minister's test was that the power to amend had not been exceeded "so long as there remains a recognisable relation with the draft plan which permits ordinary language to describe what is done as an altered draft rather than an entirely fresh plan" (at 84). Although Priestley JA had some concern about the result from a practical perspective, he was satisfied that the plan as made "was significantly different from the draft…publicly exhibited. It made the planning law substantially different from that which had been the subject of consultation between the Director and the Council" (at 89) (and, I interpolate, substantially different from the planning law as contained in the draft plan publicly exhibited).

23 This approach was consistent with other decisions concerning powers to modify or alter an instrument. Thus a power to "modify" a development consent has been held to authorise alterations "without radical transformation" (for example, Sydney City Council v Ilenace Pty Ltd [1984] 3 NSWLR 414 at 421, North Sydney Council v Michael Standley & Associates Pty Ltd (1998) 43 NSWLR 468 at 474, Transport Action Group Against Motorways Inc v Roads and Traffic Authority (1999) 46 NSWLR 598 at [76], [84] and [105] citing Qantas Airways Ltd v Aravco Ltd (1996) 185 CLR 43 at 61).

24 The Minister submitted that the differences between draft Amendment No 62 as exhibited and as made were not outside the power of alteration in s 68(3). The differences were twofold. First, there was a slight change in wording between the manner in which a covenant is to be suspended. This was a reference to the fact that the exhibited draft provided "Council may determine that any covenant, agreement or similar instrument imposing restrictions as to the development on, or use of, the land to which the consent applies, to the extent necessary to serve that purpose, shall not apply to that development". Amendment No 62 as made provides that "any covenant, agreement or similar instrument imposing restrictions as to the erection or use of buildings on land to which this clause applies for certain purposes or as to the use of such land for certain purposes, to the extent necessary to serve that purpose, shall not apply to that development". Secondly, there was a difference between the land to which the exhibited draft and Amendment No 62 as made applied. This was a reference to the fact that the exhibited draft applied to "the Lane Cove Municipality" whereas Amendment No 62 as made applies to "Lots 1 and 2, DP 1063151 (formerly comprising Lot 17, DP 29396) known respectively as Nos 83 and 85 Kenneth Street, Longueville".

25 The Minister submitted that these alterations were supported by s 68(3) of the EPA Act and, alternatively, by the combined operation of s 68(3) and (5) of the EPA Act. The effect of the draft as exhibited and Amendment No 62 as made is in essence the same. The aim and essential character of both plans concerned the suspension of covenants. The only difference is that the exhibited draft was intended to operate across the whole local government area whereas Amendment No 62 as made operated with respect to one parcel of land only (comprising the two lots). Amendment No 62 as made remains a product of the process under Div 4 of Pt 3 and bears a striking resemblance to the draft as exhibited. The Council adopted these submissions, other than that the Council did not submit that it had exercised any function under s 68(5).

26 The power in s 68(5) can be readily dismissed from consideration. That power is for a council "to exclude certain provisions of the draft plan or exclude part of the land from the draft plan, or both (in this section referred to as the deferred matter) which, in its opinion, require or requires further consideration but which should not prejudice the consideration by the Director-General and the Minister of the draft plan as submitted". This power is linked to s 68(6), which provides that a council "may subsequently take action under this section in respect of the deferred matter, without having to publicly re-exhibit that deferred matter, as if it were a draft local environmental plan." It is clear that the Council did not form the opinion required by s 68(5) as a condition of the power of exclusion of provisions by way of deferral. Apart from the fact that the Department's advice to the Council was to use s 68(3) of the EPA Act and the Council disavowed reliance on s 68(5) in these proceedings, the Council's resolution of 7 August 2006 is not so ambiguous as to support any inference that it involved the formation of an opinion within the scope of that subsection. As the opinion was not formed, the power in s 68(5) was not available. The Minister's related submissions about alternative sources of power, accordingly, were also not available. The conditions under which the powers in s 68(3) and (5) could be exercised are different and thus principles relating to a mistake in the source of power and an alternative source of power do not apply (for example, VAW (Kurri Kurri) Pty Ltd v Scientific Committee (2003) 58 NSWLR 631 at [18]-[58]). The only power of relevance is thus s 68(3).

27 Although the approach of Priestley JA in Leichhardt Council v Minister for Planning [No 2] involved conclusions based on an overall impression reached by comparison between the exhibited draft and the plan as made, there was no suggestion in the reasons (or any later decision) that the courts should defer to the opinions of the Director-General, the Minister (in that case) or the Council (in this case). To the contrary, Priestley JA said that to adopt the Minister's submissions in that matter would make the process "dependent on how much notice the Minister was prepared to take of it" (at 88). A similar approach is necessary in this case.

28 I do not accept the Minister's submissions. I am satisfied that, whatever descriptive formula used, Amendment No 62 as made was not the product of an alteration within the meaning of s 68(3) and was never exhibited as required by s 66 of the EPA Act. Amendment No 62 as made involved differences of such significance that the plan made by the Minister could not be said to be an outcome of the Pt 3 Div 4 process. It was a different plan and made the planning law substantially different. The exhibited draft applied to the whole local government area. It empowered (or purported to empower) the Council to determine that any covenant imposing restrictions as to the development of land shall not apply, to the extent necessary to serve that purpose, to the development. Amendment No 62 as made applies to two lots comprising the one parcel of land. It provides that any covenant imposing restrictions as to the erection or use of buildings on that land for certain purposes, to the extent necessary to serve that purpose, shall not apply to that development.

29 Considered in terms of substantive operation and effect, the two instruments bear no real relationship to each other. Other examples may more succinctly disclose why this must be so. (1) A draft plan as exhibited may provide that a consent authority may consent to development for a nominated purpose on all land within the area. If the plan as made authorises the consent authority to permit development for that purpose on one parcel only, the effect of the instrument, practically and legally, is radically different. It is radically different from all perspectives, including that of the consent authority, the developer, potential objectors, the owner of the one parcel of land on which the development purpose is permissible and the owner of the adjoining land. (2) A draft plan as exhibited may provide that height controls are no longer to apply throughout the local government area. If the plan as made removes the height controls for one parcel of land only the effect of the instrument again is radically different from all perspectives.

30 This case involves the same considerations. The residents and ratepayers of Lane Cove were given the opportunity to make submissions through the mandated public exhibition process about a draft plan that would empower the Council to quash all restrictive covenants on any parcel of land in the local government area to the extent necessary to enable development to be carried out. They ended up with a plan that would quash covenants on two lots, comprising one parcel, to the extent necessary to enable development on that land to be carried out. The applicant was given the opportunity to make submissions through the mandated public exhibition process about the draft plan, the effect of which would have been to enable the covenants burdening and benefiting both her neighbour's land and her own land to be quashed. The applicant ended up with a plan that left her with the covenant burdening her own land but removed the covenant benefiting her land to the extent necessary to enable her neighbour's land to be developed. Once the true operation of the draft plan and plan as made are recognised, it is not possible to conclude that the latter is the product of an alteration of the former. In particular, the latter cannot be characterised as a mere subset of the former in terms of its operation and effect. Properly characterised it has a significantly different character, substance and legal effect. This is so irrespective of whether or not the covenants benefiting and burdening the land within DP 29396 are characterised by mutuality (such as within a scheme of development). Amendment No 62 as made is not a product of the process Div 4 of Pt 3 of the EPA Act required.

31 Consistent with the respondents' proper concessions, it follows that Amendment No 62 was never exhibited as required by s 66 of the EPA Act. This involved a breach of an "essential", "imperative" or "inviolable" limit or restraint in the EPA Act, against which s 35 does not protect. Accordingly, the applicant is entitled to the declaration sought.

32 In consequence, it is not necessary to deal with any other aspect of the applicant's submissions, which raised certain novel grounds of challenge, and nor with the affidavits referred to above. For present purposes it is sufficient to observe that the applicant's approach to s 35 would have the effect of setting the privative provision aside altogether, contrary to the approach of the Court of Appeal in Pallas Newco. The argument that the power to alter in s 68(3) is only available after a public hearing does not accord well with the statutory scheme or the words of the provision. The reliance on the common law breach of procedural fairness is not readily reconcilable with the majority decision in Vanmeld. However, given my conclusions above, this matter is not an appropriate vehicle for resolution of these and the applicant's other two arguments.

33 For these reasons, I declare Amendment No 62 to Lane Cove Local Environmental Plan 1987 invalid. The exhibits are returned. Costs may be argued.

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