BSM Holdings Pty Ltd v Deane Street Holdings Pty Ltd

The Summons

1. The summons seeks the following relief: 1 An interlocutory order that the proceedings be expedited. 2 Declare that the decision to grant development consent was not validly made. 3 Order that the consent and any construction certificates issued with respect to the consent be set aside. 4 Costs.
2. Paragraphs 8 to 14, in particular, assert the following: 1 A partly built structure occupies the Tower site. Two existing development consents BD 2012.136 and DA 98/2015 authorise the erection of a building on the Tower site. The Applicant claims that the existing structure has not been erected in accordance with the consents. For that reason, references in the Summons to the existing structure and the existing consents are intended to express a difference. However, whether the existing structure complies with the existing consents is not otherwise relevant to the grounds. 2 Initially, the First Respondent applied to modify the existing consents, in part to bring the existing structure into compliance with the existing consents, and to apply for development consent to add levels and a basement to the existing structure. During its processing, the DA was amended to incorporate the proposed modifications within it, and the Second Respondent granted consent to a fresh set of plans for the whole building. 3 The effect of the consent to the Tower was to change every floor of the approved building, including each floor level, floor plates, balconies, slabs, proposed uses, the ground floor design, as well as adding four levels to significantly increase the height of the building and one additional basement level. 4 In the premises, the effect of consenting to the Tower was the FSR requirements of the LEP applied to the whole building, whatever calculations had been previously made when determining the earlier consents (in some cases, under different planning provisions). 5 In addition, for the purposes of applying a FSR, clause 4.5(8) of the LEP required the GFA of the existing structure to be included in the calculation of the total floor space, whether or not the proposed development related to the partly built structure. 6 The effect of this provision was to apply the FSR and FSR exceptions in clauses 4.4 and 4.4A of the LEP to the whole building, including levels which may have already been erected (whether or not they were previously approved). FSR provisions applicable to the developments 7 The proposed developments are situated in the Commercial Core of the Burwood Town Centre, and are within Area 1 of the Floor Space Ratio Map, for the purposes of clause 4.4A of the LEP (see clause 4.4A(8)).
3. The grounds upon which it is alleged that the Council has no power to consent to the DA are three-fold: 1. first, the building floor space ratio ("FSR") under the BLEP has been exceeded; 2. second, the residential accommodation FSR under the BLEP was exceeded; and 3. third, the serviced apartment FSR under the BLEP was exceeded.

Evidence of the Parties

1. In support of its application, BSM relied upon two affidavits of Mr Simington affirmed 22 August and 10 September 2020, respectively.
2. The affidavits of Mr Simington deposed to many of the facts agreed to in the statement of agreed facts. It was his belief that given the progress of the works, if the matter was not heard and disposed of this year, the subject matter of the litigation would be lost because the works would be completed, and moreover, that this was a matter that the Court would take into account as a matter of discretion in granting any relief.
3. It was also his view, repeated in oral argument by BSM's counsel, Mr Tim Robertson SC, that absent expedition, if the consent was still in force at the time of the appeal of the underlying proceedings, this could prejudice BSM because the respondents could argue that there was relevantly a valid extant consent militating against the granting of relief.
4. Attached to Mr Simington's earlier affidavit was the Panel's report dated 14 July 2020. It contained various photographs of as yet undeveloped land in close proximity to the Tower Site.
5. Mr Robertson SC conceded, however, that there was no development application that would be affected by the outcome of the proceedings.
6. This is no doubt because, as the BLEP Plan plainly indicated, the area to which the development standards apply which are the subject of these proceedings is geographically confined. That is, the particular FSR development standards applicable to the Tower Site that BSM contends were wrongly considered and applied by the Panel, only apply to a small physical area.
7. In his later affidavit, Mr Simington annexed a contract of sale (off the plan) for one of the apartments the subject of the consent and the development at the Tower Site.
8. In response, Deane and Elias relied upon an affidavit of Ms Saad sworn 4 September 2020. Ms Saad deposed that: 1. the matter was likely to occupy four days of hearing (not the one day estimate put forward by Mr Simington) given that there were three respondents; that there would in all likelihood be evidence adduced by Deane and Elias going to the issue of the discretion; and that there were a large number of disputed facts arising from the relationship between the 2012, 2015 and 2020 consents, especially having regard to the operation of the VPA; 2. that a copy of a legal advice drafted by Mr Robertson SC identifying similar, if not identical issues to those raised in these proceedings, was before the Panel who granted consent in any event; and 3. that Deane and Elias would have difficulty in preparing for two sets of proceedings being heard in close proximity to each other (these proceedings and the appeal in the underlying proceedings) if the matter was expedited.
9. The Council relied upon an affidavit of Mr Steven Shneider sworn 4 September 2020. Mr Shneider is the solicitor acting for the Council. In his affidavit he deposed to the burden on the Council's resources, already at maximum capacity due to a backlog in processing development applications by reason of COVID-19, if expedition was granted. In particular, he noted that because BSM was challenging the Council's calculations of FSR in respect of the development at the Tower Site, it would be necessary to engage a council officer to review the methodology and calculations that were used in the assessment of the DA. This would take a planner away from their normal duties at short notice, which would place an additional strain on the Council's limited resources at this time.

Principles Applicable in Granting Expedition

1. There is no specific power dealing with expedition in either the Civil Procedure Act 2005 ("CPA"), the Uniform Civil Procedure Rules 2005 ("UCPR") (other than in the Court of Appeal: see r 51.60 of the UCPR), the Land and Environment Court Act 1979 ("LEC Act") or the Land and Environment Court Rules 2007. It therefore appears that the power of this Court to grant expedition is found in s 61 of the CPA and r 2.1 of the UCPR.
2. Section 61 of the CPA relevantly provides as follows: 61 Directions as to practice and procedure generally (1) The court may, by order, give such directions as it thinks fit (whether or not inconsistent with rules of court) for the speedy determination of the real issues between the parties to the proceedings. (2) In particular, the court may, by order, do any one or more of the following - (a) it may direct any party to proceedings to take specified steps in relation to the proceedings, (b) it may direct the parties to proceedings as to the time within which specified steps in the proceedings must be completed, (c) it may give such other directions with respect to the conduct of proceedings as it considers appropriate.
3. This provision enables the Court to give such directions as it thinks fit for the speedy determination of the real issues between the parties to the proceedings, and r 2.1 of the UCPR enables the Court, at any time, to give such directions and make such orders for the conduct of any proceedings as appear convenient for the just, quick and cheap disposal of the proceedings. Both compliment the provisions contained in ss 56 to 58 and ss 61 to 63 of the CPA, to which regard must be had.
4. In Vaughan v Dawson [2005] NSWSC 33, Campbell J quoted (at [8]) the following passage from Greetings Oxford Koala Hotel Pty Ltd v Oxford Square Investments Pty Ltd (1989) 18 NSWLR 33 (at 42-43 per Young J) articulating some of the applicable principles in determining whether or not to exercise the Court's discretion to grant expedition: 8 In Greetings Oxford Koala Hotel Pty Ltd v Oxford Square Investments Pty Ltd (1989) 18 NSWLR 33 at 42- 43 Young J said: "…when considering whether to expedite proceedings in this Division there are at least six factors which are taken into account. These are: (1) Is this the appropriate Court for the litigation, in particular: (a) does the litigation fall into the work normally done by this Court; and (b) is there a sufficient nexus with New South Wales. (2) Is there a special factor involved which warrants expedition. Usually these factors will be: (a) the loss of witnesses if the case is not fixed at an early date; (b) matters of public importance; (c) that the subject matter of the litigation will be lost if it is not heard quickly; (d) that the litigation to date has been delayed through no fault of the applicant; (e) that the applicant is suffering hardship not caused through his own fault; (f) that there is self-induced hardship (including those cases where corporate bodies fix a meeting date in the near future and then expect the Court to displace all other matters to hear their dispute before that date); (g) the nature of the case (for example, ejectment, child custody); and (h) that there are large sums of money involved. There may, of course, be other matters which can count as special factors, but the list that I have given is what occurs in the usual case. The health or age of parties or witnesses may, of course, come under (a), (c) or (e) or all of those headings. (3) Have the parties proceeded up to the date of the hearing of the motion for expedition with due speed? (4) Are the parties willing if expedition is granted to do all in their power to abridge the hearing time including joining in an agreed bundle of documents, preparing statements of witnesses, filing lists of objections to affidavits, making admissions of matters not really in dispute and restraining wide-ranging cross-examination. Of course there will always be cases where one party's interests are to delay resolution of the dispute as much as possible. Such cases can usually be recognised and special procedures adopted. Then there are two factors dealing with the exigencies of the list, viz: (5) Any application for expedition must be judged in the light of the number of other cases of equal or higher priority that also seek an expedited hearing. (6) Any "right" to expedition is a right to have the case fixed on one occasion. If, after a date has been fixed, it has to be vacated, it is difficult indeed to justify again expediting the proceedings: Ron Hodgson Cabramatta Pty Ltd v Wewoka Pty Ltd t/as B P Cabramatta Motors (Waddell CJ in Equity, 30 March 1989, unreported). The question here is whether there is a seventh guideline, namely, that one should not expedite a case where the chances of the applicant for expedition securing what it wants in the proceedings are not high. This point arises because the defendant submits that because of the matters I have already canvassed, the chances of the plaintiff obtaining equitable relief must, according to the defendant, be slim. I do not think that the Court, ought in an application for expedition, to make an assessment of the applicant's chances of success. However, I do agree that there is a seventh guideline, namely, that the Court should not expedite a case if it considers that in all the circumstances the chances of the applicant obtaining what it seeks in the litigation cannot be put as higher than speculative." Those principles remain applicable.
5. These principles have subsequently been applied in this Court on numerous occasions (Wren Investments Pty Ltd v Hunter [2011] NSWLEC 122 at [35]-[43]; Healthscope Ltd v Minister for Planning and Infrastructure (No 2) [2011] NSWLEC 237 at [8]-[10]; Xiang Rong Investment Pty Ltd v Ku-ring-gai Municipal Council [2012] NSWLEC 44 at [14]; North Sydney Council v Minister for Local Government [2016] NSWLEC 161 at [16]-[18]; and M.H. Earthmoving Pty Ltd v Cootamundra-Gundagai Regional Council (No 2) [2018] NSWLEC 101 at [99] and [100].

Expedition Must Be Refused

1. Turning to the factors from the case law referred to above relevant to this application, it is tolerably clear that expedition should be refused.

There Are No Special Factors Warranting Expedition

1. There are no special factors that would warrant expedition. As alluded to above, BSM submitted that if expedition was not granted, because the construction being carried out pursuant to the consent was nearing completion, unless expedition was granted the subject matter of the litigation would be lost and it would be prejudiced because a factor in the exercise of the Court's discretion to grant relief if its challenge was successful would be the completion of the works.
2. First, while it is undoubtedly correct to submit that the works will be completed by the time the case is finally disposed of, even with a grant of expedition this is nevertheless likely to be the case. This is because of the Court's backlog of cases due to the COVID-19 pandemic which means that even with expedition, the first available day that the matter could be heard is in the week commencing 26 October 2020 (the day of the appeal in the underlying proceedings). I accept the submission of the respondents that the matter will take more than one day to be heard and that it will require three to four days of hearing time. This limits the range of available hearing days in the Court's calendar. Given the present demands on the Court's resources, a judgment prior to mid-November 2020 would be unlikely. By then almost all of the works, including the internal fit-out, will have been completed.
3. Second, were BSM genuinely concerned about preserving the status quo, it should have sought interim injunctive relief (Marshall Rural Pty Ltd v Basscave Ltd [2015] NSWLEC 86 at [13]-[15]). It elected not to do so because, as Mr Robertson SC candidly told the Court, it did not want to assume the risk associated with having to proffer an undertaking as to damages. But a failure to offer the usual undertaking as to damages is not, of itself, fatal to an application for injunctive relief. While no inference can be drawn as to the strength of BSM's case by its refusal to seek an interlocutory injunction, it nevertheless remains the case that applications for expedition ought not be used as a substitute for applications for interim relief to preserve the status quo.
4. Third, BSM did not press for the motion for expedition to be heard expeditiously (there was no application to the duty judge, for example). Thus, as at the date of the hearing of the application, the majority of the works approved by the Council will, according to the unchallenged evidence of Ms Saad, have been undertaken. In other words, BSM was content to have the motion heard within the normal course of the Court's business knowing that Deane and Elias were continuing with the works the subject of the consent.
5. Fourth, BSM does not seek any consequential orders for demolition or rectification if its challenge is successful. The relief sought in the summons can therefore be made irrespective of whether the works carried out were authorised by the consent.
6. Fifth, no disadvantage is suffered in respect of the appeal proceedings. While there will be an extant valid consent as at the date of the appeal, it is inconceivable that that Court will not be informed by BSM of the present challenge. In any event, the first opportunity that this Court can hear the Class 4 challenge is on or after the hearing of the appeal, even with expedition. No advantage will therefore be gained by any grant of expedition.

There Are No Matters of Public Importance

1. There is no allegation of any risk to public safety nor, as was properly conceded by Mr Robertson SC, is there any suggestion of any adverse impact on BSM's land, or on any other land that may be subject of development.
2. Rather, BSM submitted that a matter of public importance existed justifying expedition insofar as: 1. clarity was required with respect to the proper construction and application of the relevant development standards contained in cll 4.4A and 4.5 of the BLEP; and 2. the proceeding could have ramifications for third party purchasers of units the subject of the development if the consent is held to be invalid and any construction certificates issued pursuant to the consent are set aside resulting in an inability to obtain an occupation certificate (see ss 6.9 and 6.10 of the Environmental Planning and Assessment Act 1979).
3. While the first of the two matters is undoubtedly one of public importance, given that no actual or potential development (other than the development the subject of this challenge) is presently affected by the proceedings, it is not attended to by any urgency, let alone any urgency that would demand that these proceedings be expedited.
4. In relation to the second matter of public interest, although BSM's altruism is laudable insofar as it claims to be concerned about the welfare of third party purchasers of units built by another developer in circumstances where neither Deane nor Elias are troubled about any potential liability they may face as a result of losing these proceedings, the Court is inclined to place limited weight on this factor, especially when: 1. any third party properly advised would be aware that no occupation certificate presently exists for the upper four storeys of the development; and 2. Deane can seek a building information certificate for works carried out under the consent; a new development consent for the works yet to be carried out; a development consent for the use of the building; and an occupation certificate founded on the development consent for use and the building information certificate. Alternatively, orders under s 25B of the LEC Act may be sought (Hoxton Park Residents Action Group Inc v Liverpool City Council [2011] NSWCA 349; (2011) 81 NSWLR 638).
5. BSM's remaining submissions concerning the public importance of the litigation were at such a generalised level (emphasising, as they did, the need to maintain the integrity of the planning system of New South Wales) that they were amenable to application to all planning and development matters that come before the Court, the logical corollary of which was that all such matters should be expedited. Plainly this cannot be correct.

Prejudice to the Parties

1. No witnesses will be lost by reason of a refusal to grant expedition.
2. Further, as discussed above, there is no real prejudice to BSM in light of its decision not to pursue a grant of interim relief.
3. This may be contrasted with the uncontested evidence of all of the respondents who submitted that expedition would impose a significant resource burden on them, especially in light of the impending appeal in the underlying proceedings. Given that neither pleadings nor evidence have been filed, and the matter has not been subject to any case management, considerable work will be required, at very short notice, to prepare it for hearing. Furthermore, to reiterate, the evidence before the Court and the issues raised by the summons disclose that the hearing of this matter will take well in excess of one day and will not be as confined in its scope as was suggested by BSM. Put another way, expedition of the hearing of this matter would prejudice the respondents and subject them to unjustified hardship (in coming to this conclusion the Court is mindful of the limited role that the Council ought to play in the proceedings consistent with the principles espoused in R v Australian Broadcasting Tribunal; Ex parte Hardiman [1980] HCA 13; (1980) 144 CLR 13 at 35: see, for example, Blacktown City Council v Concato (No 4) [2020] NSWSC 9 at [4]).

The Strength of BSM's Case

1. Finally, and for the sake of completeness, it should be noted that, in the Court's view, BSM's case cannot be described as "speculative". In stating this, the Court is not making an assessment of BSM's chances of success, rather it is rejecting Deane and Elias's submission that a basis upon which expedition ought to be refused is because BSM's case is "speculative". When pressed, the sole reason proffered for this assessment was the fact that the Panel had Mr Robertson SC's advice before it, where many of the same issues raised in these Class 4 proceedings were raised in the advice, and consent was nevertheless granted.
2. On no view does the Panel's actions make BSM's case "speculative". On the contrary, if BSM succeeds in its challenge it will mean that the Panel was wrong. It will not be the first time that the decision of a consent authority is overturned by this Court. Conversely, if BSM fails in the proceedings this does not, of itself, mean that its case was "speculative".
3. BSM contends that three FSR development standards contained in the BLEP that applied to the DA were not met, and moreover, that either standards could not be waived under cl 4.6 (exceptions to development standards) of that planning instrument or that they were not subject to a cl 4.6 request. If any of these grounds are established, the granting of the consent was affected by jurisdictional error.
4. Having regard to the content of its claim as set out in the summons, and in light of the explanation provided by Mr Robertson SC as to the errors in construction and application of the relevant FSR standards contained in the BLEP made by the Council in granting consent, it is clear that BSM's case is not "speculative", but is tenable and arguable. As was aptly observed by Mr Robertson SC, if the case was "speculative" why was an estimate of four days to hear the matter given by the respondents?

Costs

1. These being Class 4 proceedings costs generally follow the event. There is no reason to depart from the usual presumptive rule in this regard.

Orders

1. In conformity with the reasons given above, the notice of motion for expedition is dismissed. The applicant is to pay the respondents' costs of the motion. The exhibits may be returned.

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: 18 September 2020