Cavanagh v Wollondilly Shire Council

The Development Proposal

1. The substantive Class 1 proceedings concern an appeal against the deemed refusal of DA 784/2018 ("the DA"), under which Mr Cavanagh seeks consent for: 1. the subdivision of Lot 6 DP 1128635 into five Torrens title lots in two stages; 2. the extension of Westminster Place; 3. a new cul-de-sac head for Westminster Place; and 4. internal access driveways for two proposed lots in the subdivision.
2. Clause 4.1B of the Wollondilly Local Environmental Plan 2011 ("the LEP") states: 4.1B Subdivision of certain land in Zone E4 Environmental Living (1) The objective of this clause is to ensure that certain land within Zone E4 Environmental Living is not subdivided to significantly increase the density of development on the land. (2) This clause applies to the land identified as "Original holdings" on the Original Holdings Map. (3) Despite clause 4.1, development consent must not be granted for the subdivision of land to which this clause applies if the total number of lots comprising the land will exceed 1 lot per 4 hectares as a result of the subdivision. (4) In this clause, Original Holdings Map means the Wollondilly Local Environmental Plan 2011 Original Holdings Map.
3. The Council's position is that the subdivision of Lot 6 DP 1128635 into five lots is contrary to cl 4.1B of the LEP. In its SOFAC it particularised the contravention in the following way: 1.1 The Site is partly within Zone E4 and partly within Zone RU2 under the LEP and is part of an Original Holding shown on Original Holdings Map Sheet OHL_008F of the LEP. 1.2 The total area of the Original Holding is 80.15 hectares. 1.3 The objective of clause 4.1B of the LEP is to ensure that 'certain land' within Zone E4 (Environmental Living) is not subdivided to significantly increase the density of development on the land (cl.4.1B(1)). 1.4 The 'certain land' to which clause 4.1B(1) refers is the land within Zone E4 identified as 'Original holdings' on the LEP Original Holdings Map (cl.4.1B(2)). 1.5 The objective of clause 4.1B is therefore to ensure that land within Zone E4 (Environmental Living) identified as an original holding on the Original Holdings Map is not subdivided to significantly increase the density of development on that land. 1.6 The objective of clause 4.1B of the LEP is achieved by prohibiting the subdivision of land to which clause 4.1B applies where the subdivision would result in the total number of lots exceeding 1 lot per 4 hectares (cl.4.1B(3)). 1.7 The Original Holding is comprised of approximately 40.15 hectares of land zoned E4. 1.8 That part of the Original Holding zoned E4 has already been subdivided to create 11 lots, exhausting the subdivision potential of that land. 1.9 If the DA is approved, 15 lots will have been created from that part of the Original Holding zoned E4, contrary to cl.4.1B. 1.10 Clause 4.6 of the LEP (exceptions to development standards) does not allow development consent to be granted for development that would contravene clause 4.1B of the LEP.

The Procedural History to the Making of the Application

1. On 27 March 2019 Mr Cavanagh filed a Class 1 appeal.
2. The proceedings were listed for directions in the Court on 29 April 2019. At that time the Council foreshadowed that a legal issue in the proceedings was not capable of resolution at the s 34 conciliation conference and that the matter should therefore be listed directly for hearing. The Court made directions for the Council to file and serve its SOFAC by 2 May 2019, and the matter was stood over for directions until 13 May 2019.
3. On 2 May 2019 the SOFAC was filed and served by the Council. It included contention 1: The proposed development is prohibited under clause 4.1B of the LEP.
4. On 13 May 2019, Mr Cavanagh sought an order which would allow him to file and serve further documents upon which he intended to rely for the determination of the proceedings. The Court declined to make the order, instead relisting the matter for further directions on 12 August 2019, to allow him sufficient time to file a notice of motion formally seeking leave to amend his DA, if he so elected. The Court did not make any orders for the filing and serving of any expert evidence in the matter.
5. At the directions hearing on 13 May 2019, the parties agreed to the matter being listed for hearing for two days on 12 and 13 December 2019. The hearing was to commence on site in Razorback, New South Wales, and continue thereafter at the Picton Local Court. The second day of the hearing (on 13 December 2019) was listed before the Court in Sydney.
6. The contentions identified under the headings "Part B2: Contentions which should cause the Court to refuse the Application" and "Part B3: Contentions that may be resolved by conditions of consent" in the Council's SOFAC all relate to merit issues ("the merit contentions").

Factual Matters in Agreement

1. The following matters were not in dispute: 1. if the Court grants leave to raise the separate question set out in the motion and finds in favour of the Council then the two day hearing will not be required; however 2. if the Court grants leave to raise the separate question set out in motion and finds in favour of Mr Cavanagh, all of the Council's merit contentions will require determination and the hearing will nevertheless take two days; 3. expert evidence is not required to determine the separate question; and 4. the evidence required to determine the separate question will be documentary only, is not voluminous, and is unlikely to be contentious.

Factual Matters in Dispute

1. Beyond these agreed facts, Mr Cavanagh relied upon an affidavit of Ms Robecca Cunningham, affirmed 23 July 2019. Ms Cunningham is a solicitor acting for Mr Cavanagh.
2. In her affidavit she relevantly deposed to the following: 5. The contentions identified under the headings 'Part B2: Contentions which should cause the Court to refuse the Application' and 'Part B3: Contentions that may be resolved by contentions of consent' in the Respondent's Statement of Facts and Contentions relate to merit issues ('Merit Contentions'). Further evidence is required to address the Merit Contentions as follows: a. Contentions 2 and 4 - evidence from a town planner and preparation of a joint report by town planning experts. b. Contention 5 - evidence from a traffic engineer and joint reports by traffic engineers; detailed site investigation in relation to contamination; bushfire report and joint reports of the bushfire experts, flora/fauna experts, preparation of a site plan, a geotechnical report and joint reports of the geotechnical engineers. 6. In summary the expert evidence required to address the contentions involves the following disciplines: a. Town planners b. Traffic engineers c. Water and sewerage engineers d. Contamination consultant e. Bushfire consultant f. Flora/fauna consultant g. Geotechnical engineer h. Survey With the exception of survey and the contamination consultant, which may be resolved without the need for joint expert reporting it is likely that all of these disciplines will be required to prepare evidence, joint expert reports and provide evidence at Court for a two day hearing. 7. In my experience most experts have an hourly rate not less than $400 per hour. For six experts to spend one day preparing for and two days attending hearing, assuming eight hour days, the cost of preparing the evidence to address the Merit Contentions is likely to exceed $57,600. The cost of five experts preparing for and attending hearing is in addition to the cost of survey and the detailed site contamination investigation which has already been prepared at a cost of $16,555 (inclusive of GST). …
3. She was cross-examined by the Council, whereupon she disclosed that the estimate of $57,600 did not include the drafting of those expert reports, only the cost of the time that the experts would spend in Court.
4. Ms Cunningham's cost estimates did not include legal fees.
5. The Council relied upon an affidavit of Mr Alan Bradbury, affirmed 16 July 2019. Mr Bradbury is the solicitor acting for the Council. The affidavit was made in response to an early affidavit of Ms Cunningham that was ultimately not read by Mr Cavanagh.
6. In his affidavit Mr Bradbury noted that: 1. Mr Cavanagh had not yet filed his SOFAC; 2. the Council was likely to seek orders for the filing and serving of town planning expert evidence; 3. if the separate question was determined against the Council, it was unlikely that there will be any material change to the duration of the hearing; and 4. because preparation for the separate hearing and the remainder of the Class 1 appeal would occur in tandem, this would increase the parties' costs.
7. With respect to the latter point, the Council agreed that to avoid the parties incurring costs that might ultimately be wasted if the separate question was resolved in the Council's favour, appropriate orders could be made by the Court pausing the need to prepare for the Class 1 appeal until such time as the separate question had been determined. Given that the only available dates for the hearing of the separate question were in August, the separate question would be determined sufficiently in advance of the Class 1 hearing listed in mid-December and those hearing dates were not likely to be jeopardised.

Applicable Legal Principles

1. The power to make orders for a question to be decided separately is contained in r 28.2 of the Uniform Civil Procedure Rules 2005 ("UCPR"), which provides that: 28.2 Order for decision The court may make orders for the decision of any question separately from any other question, whether before, at or after any trial or further trial in the proceedings.
2. The legal principles applicable to the exercise of the Court's discretion to order the determination of a separate question were summarised by Robson J in Royal Motor Yacht Club (Broken Bay) New South Wales Pty Ltd v Northern Beaches Council [2016] NSWLEC 87 (at [10], referring to the judgment of Biscoe J in 820 Cawdor Road Pty Ltd v Wollondilly Shire Council (2013) 195 LGERA 170; [2013] NSWLEC 8): 10 The principles applicable to the exercise of the Court's discretion to order the determination of a separate question were distilled by Biscoe J as follows in 820 Cawdor Road Pty Ltd v Wollondilly Shire Council at [10] and have been endorsed and applied by this Court on numerous occasions: (a) Generally speaking, all issues should be tried and decided at the same time. (b) It is for the party seeking the order to show to the Court that separate decision of a question is appropriate. (c) Separate decision of a question is likely to be appropriate where it can clearly be seen that it will facilitate the just, quick and cheap resolution of the proceedings or the central issues in the proceedings. This gives effect to s 56 of the Civil Procedure Act. Thus, the procedure needs to be fair and involve real savings in time and cost. (d) Separate decision of a question may be appropriate where it is critical to the outcome of the proceedings and (at least if decided in one way) will bring the proceedings to an end. (e) In particular circumstances separate decision of a question may be appropriate even if it will not bring the proceedings to an end. This may occur where the decision will substantially narrow the field of controversy by obviating unnecessary and expensive hearing of other questions or where the decision carries with it a strong prospect that the parties will then be able to agree upon resolution of the proceedings. But on such occasions care must be exercised lest fragmentation of the proceedings (particularly where the exercise of appeal rights is borne in mind) brings delay, expense and hardship greater than that which the making of an order was intended to avoid. (f) Separate decision of a question is unlikely to be appropriate where it may involve the credibility of witnesses which is material to remaining issues in the proceedings (and thus require the remaining issues to be dealt with by another judge). (g) Where the question sought to be separated involves a question of law, there should be a clear definition of what the point of law raised is and all the facts upon which that question has to be considered should be agreed or clearly ascertainable. (h) Where the facts upon which decision depends are contentious, confidence in the utility of the separate question process may be less likely.
3. Those principles have been considered by the Court of Appeal in Allandale Blue Metal Pty Ltd v Roads and Maritime Services (2013) 195 LGERA 182; [2013] NSWCA 103 (at [87]-[99]) and in this Court in Dial a Dump Industries Pty Ltd v Roads and Maritime Services [2015] NSWLEC 172 (at [30]-[36]), Challenger Listed Investments Ltd v Valuer General [2015] NSWLEC 7 (at [14]) and Royal Motor Yacht Club (Broken Bay) Pty Ltd v Northern Beaches Council (No 4) [2016] NSWLEC 126 (at [10]-[12]). More recently, see Whittaker v Northern Beaches Council (No 2) [2018] NSWLEC 94 (at [8]-[9]) and M.H. Earthmoving Pty Ltd v Cootamundra-Gundagai Regional Council (No 2) [2018] NSWLEC 101 (at [14]).
4. In Royal Motor Yacht Club (No 4), the Court considered the time and expense involved in separating a question from other relevant issues (at [11]-[12]): 11 In addition, regard must be had to the observations of Ward JA in Allandale Blue Metal Pty Ltd v Roads and Maritime Services [2013] NSWCA 103; (2013) 195 LGERA 182 (at [91]), quoted above at [6]. As McFarlane JA in the same case opined (at [10]): 10 At the hearing before this Court, it was common ground between the parties that strong reasons, such as an anticipated significant saving in time and expense in relation to the final hearing, needed to be shown to justify departure from the usual rule that all issues in a proceeding are to be determined at the one time (see for example Tallglen Pty Ltd v TV Holdings Pty Ltd (1996) 22 ACSR 130 at 141 - 2). 12 More recently, Basten JA in Trives v Hornsby Shire Council [2015] NSWCA 158; (2015) 89 NSWLR 268 observed as follows (at [57]): …The convenience of separating that question from issues relating to relief is far from clear. Had the relatively confined issues raised by the proceedings in the Land and Environment Court been determined as whole, much time and energy would have been saved and the matter could have been finally disposed of by this Court on appeal…
5. In this regard, the cautionary comments of Young J in Strathfield Municipal Council v Poynting (2001) 116 LGERA 319; [2001] NSWCA 270 should be noted (at [111]-[114]): 111 My comments fall into two areas: (A) The practice of isolating separate questions in the Land and Environment Court; and (B) What is a development standard as opposed to an absolute prohibition on development. 112 As to the first matter, almost all superior courts are enabled to isolate separate questions of law and fact for decision prior to (or even after) trial of the proceedings generally. However, that power needs to be exercised with care. Very often isolating a separate set of questions actually increases the costs. There are several reasons for this. First, people get lulled into a false sense of security that they are only looking at the cost of a short hearing rather than a three day final hearing. However, by the time one takes into account the extra work considering the impact the answers have on the proceedings, engrossing and serving orders, applications for leave to appeal and the appeal itself, the bill for legal costs may be higher. Secondly, the parties cease to focus on the main issues, and, more importantly, resolving those main issues, whilst their lawyers have an intellectually satisfying debate on some arcane point. 113 The received law is that separate questions should only be posed when there is a critical matter which if dealt with in a preliminary hearing will far more likely than not be convenient and save significant expense. 114 The question as to whether there should be separate questions is, of course, a matter of discretion for each judge. However, the reported cases to which we were referred during the hearing disclose a general pattern of too free a use of the separate question procedure.
6. A similar sentiment was expressed by Bathurst CJ (with whom Meagher and Ward JJA agreed) in Jackson Lalic Lawyers Pty Ltd v Attwells [2014] NSWCA 335 (at [18]): 18 The separate question was ordered under r 28.2 of the UCPR. The circumstances in which such an order should be made are well established. It is appropriate to exercise the power under the rule where there is a preliminary question of fact or law critical to the disposition of the proceedings, in the sense that if it is decided in one way it will necessarily dispose of them: Carl Zeiss Stiftung v Herbert Smith & Co [1969] 1 Ch 93 at 98. In CBS Productions Pty Ltd v O'Neill (1985) 1 NSWLR 601, it was stated by Kirby P at 606 that the procedure should not be adopted in respect of matters not ripe for determination. In that case it was stated by Kirby P at 606, that a matter is ripe for determination were it is a central issue between the parties and the resolution of the issue will either obviate the necessity for litigation altogether, or substantially narrow the field of controversy.
7. And in Allandale, Ward JA opined as follows (at [91]): 91 In various authorities, caution has been advocated in the exercise of such a power (such as Perre v Appand Pty Ltd (1999) 198 CLR 180 at [436] per Callinan J; Allstate Explorations NL v Beaconsfield Gold NL [1999] NSWSC 832 at [24] per Santow J, as his Honour then was; Tepko Pty Ltd v Water Board (2001) 206 CLR 1 at [168] per Kirby and Callinan JJ; Strathfield Municipal Council v Poynting (2001) 116 LGERA 319 at [112] - [113] per Young CJ in Eq, as his Honour then was). In Idoport, Einstein J noted the reason for such caution in the following passage: The experience of courts suggests that the separation of proceedings often does not result in the quicker and cheaper resolution of proceedings as anticipated, but often has the reverse effect, merely causing added delay and expense to the resolution of the litigation. Thus, before an issue is to be separately determined, it must be possible to clearly see that it will facilitate the quicker and cheaper resolution of the proceedings [his Honour there citing Tallglen v Pay TV Holdings Pty Limited; Parramatta Stadium Trust v Civil and Civic Pty Ltd (unreported, Supreme Court of NSW, 27 August 1996, per Hunter J) and Century Medical v THLD [2000] NSWSC 5 (unreported, Supreme Court of NSW, 3 February 2000, per Rolfe J)]. (my emphasis)
8. Nevertheless, in Hunter v Wyong Shire Council [2012] NSWLEC 250 the Court held that it was appropriate to order the determination of a separate question in respect of the permissibility of a proposed liquor store. The principal objection by Wyong Shire Council was that the development was prohibited under the Wyong Local Environmental Plan 1991. It was held that the prospect of potentially disposing of the proceedings altogether, or at the very least, of substantially narrowing the issue in dispute between the parties, was sufficient to make the order.
9. Likewise, in Association for Better Living and Education Inc v Wyong Shire Council [2014] NSWLEC 96, Biscoe J held that it was appropriate to order the separate determination of the prohibition contentions raised by the council given the substantial savings in time and costs if the preliminary question was ordered in its favour.

The Separate Question Should be Ordered

1. Having regard to the facts not in dispute, the evidence of the parties - especially that of Ms Cunningham - and the applicable legal principles set out above, the case for ordering the separate question is compelling.
2. First, because the issue of permissibility is a threshold question applicable to the entirety of the Class 1 appeal, if the question is answered in the Council's favour, it will wholly dispose of the matter. This is because if the proposed development is prohibited under cl 4.1B of the LEP, the Court has no power to grant development consent at the final hearing of the matter.
3. As the evidence of Ms Cunningham demonstrated, the merit contentions will require the preparation of considerable costly expert evidence which would be wholly wasted if the Council's jurisdictional contention succeeds. It would defy common sense and be contrary to the spirit, if not the text, of the overriding purpose contained in s 56 of the Civil Procedure Act 2005 of the just, quick and cheap resolution of the real issues for determination, not to order the determination of a separate question in these circumstances. In this context, it is noted that the hearing of the separate question is likely to occupy less than half a day.
4. Second, the proposed separate question is a clearly defined question of law requiring no expert evidence, no determination of credit, and no voluminous documentary evidence. Fact finding by the Court will be limited because the parties intend to provide an agreed statement of facts to the Court for the determination of the separate question.
5. Third, even if answered in favour of Mr Cavanagh, having been determined prior to the Class 1 appeal, there will nevertheless be a savings in time because one of the principal contentions will have already been determined.
6. Fourth, although Mr Cavanagh ought to have made this application sooner, that is, preferably prior to the Court allocating resources by setting the Class 1 appeal down for a two day hearing, the delay is not fatal to the application. The Class 1 hearing is not imminent and if the question is answered favourably to Mr Cavanagh, the hearing can be preserved given the mid-December listing. Moreover, because no orders have been made for the filing and serving of expert evidence, wasted costs will not be incurred by the parties if the question is answered in favour of the Council.
7. Fifth, although the Council raised the concern that bifurcating the proceedings could (if the separate question was not decided in the affirmative) result in inconsistent judgments insofar as the Commissioner would have to construe the LEP, including cl 4.1B, to determine whether or not the proposed development was in the public interest (contention 2), the Commissioner would nevertheless be bound by the decision and reasoning of the earlier separate question decision to the extent of any overlap. To the extent that there is no overlap, the issue will not arise.
8. For all these reasons, it is appropriate for the Court to order the determination of the separate question identified by the parties.

Orders

1. Upon the determination of the motion, the Court made the following orders (by consent) with respect to the timetabling and hearing of the separate question: 1. pursuant to r 28.2 of the Uniform Civil Procedure Rules 2005, the following question is to be determined separately from any other question in the proceedings: Whether the proposed development is prohibited under cl 4.1B of the Wollondilly Local Environmental Plan 2011. 1. the parties are to file and serve a statement of agreed facts by 2 August 2019; 2. the parties are to file and serve an agreed bundle of documents by 2 August 2019; 3. the applicant is to file and serve an outline of submissions by 8 August 2019; 4. the respondent is to file and serve an outline of submissions by 15 August 2019; 5. the question is listed for hearing before a Judge of this Court on 22 August 2019 at 10.00am; 6. the directions hearing on 12 August 2019 is vacated; 7. parties are to notify promptly the Court if there is any material slippage in the timetable; 8. the parties have liberty to restore on three working days' notice; and 9. the exhibits are to be returned.

Amendments 26 July 2019 - Amendment - paragraph to quote (formatting) 31 July 2019 - Amendment - italicised case names in quote (formatting) 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: 31 July 2019