Chehade v Bankstown City Council

Land and Environment Court (NSW)|2012-08-17|Before: Sheahan J, Mr P

Introduction 1Mr Chehade has appealed against a decision by Commissioner Morris, dated 18 May 2012 ([2012] NSWLEC 1122), dismissing a class 1 appeal (under s 97 of the Environmental Planning and Assessment Act 1979 (the EPA Act)) against the refusal by the respondent Council of his Development Application ('DA' 192/2011). 2His DA proposed the demolition of an existing dwelling and associated out-buildings, and the construction of a ten-room boarding house at 172 Hillcrest Avenue, Mount Lewis. It was lodged on 11 March 2011, and refused by Council on 2 September 2011. 3One of the specific objects of the EPA Act (s 5(a)(viii)) is "to encourage ... the provision and maintenance of affordable housing". The legislative scheme for the achievement of that and the other objects of the Act includes the making of environmental planning instruments of various types (ss 24-26) and their "standardisation" (s 33A-B). 4The issues in the appeal before the Commissioner where (1) whether the development was compatible with the character of the local area, (2) whether the proposal was permissible on the site, and (3) whether the court should apply either the current or previous provisions of the State Environmental Planning Policy (Affordable Rental Housing) 2009 (the 'SEPP'). 5The SEPP was revised, effective 20 May 2011, i.e. while the DA was before the Council. Without its being successfully invoked, a boarding house was not a permissible use of the site (Tp 5, LL1-10 and Tp13, LL22-26)). 6At the heart of the matter was the relationship/interaction of the SEPP with Bankstown Local Environmental Plan 2001 (the 'LEP'), and the Standard Instrument (Local Environmental Plans) Order 2006 ('the Order'). 7In the summons commencing this appeal under s 56A of the Land and Environment Court Act 1979, (the 'Court Act'), the appealing applicant attacks "the part of the decision below in relation to the question of permissibility of the application pursuant to clause 5(1)(b) of" the SEPP, and states the following grounds of his appeal (pars 6 and 7): 6. The Commissioner erred in law in the construction of clause 5(1)(b) of State Environmental Planning Policy (Affordable Rental Housing) 2009 ('SEPP ARH') in the formulation of the Commissioner's opinion that the Residential 2(a) zone under Bankstown Local Environmental Plan 2001 is not equivalent to the R1 and R2 zones under the Standard Instrument. 7. The Commissioner erred in law by failing to form any requisite or necessary opinion pursuant to clause 5(1)(b) of SEPP ARH. 8The appellant asks the court on this appeal (in prayers 1 to 5 of the s 56A summons): (1)to set aside the Commissioner's orders dismissing his appeal and refusing him consent; (2)to remit the matter to Commissioner Morris; and (3)to order the respondent to pay his costs of this appeal. 9The relevant documents for the argument and consideration of this s 56A appeal were collected in an agreed appeal book. They comprised the learned Commissioner's judgment (tab 1), the relevant pages of the LEP (tab 2), the SEPP in its original form (tab 3), the SEPP in its later revised/amended form (tab 4), and the (standard instrument) Order (tab 5), 10I turn now to the appeal book documents, taking the instruments first.

The order 11The standard instrument in the Order (tab 5) includes the following relevant provisions in respect of the form and content it prescribes for a principal LEP for an area. 12Section 33A of the EPA Act allows an environmental planning instrument to be made by declaring that the applicable mandatory provisions of the standard instrument are adopted (see cl 2). The provisions in that standard instrument are identified as either "mandatory"/"compulsory" (for at least certain cases), or "optional", and cl 4 of the Order provides (at fol 2) as follows: (1) The mandatory provisions of the standard instrument prescribed by this Order are as follows: (a) provisions identified in the standard instrument as compulsory provisions (whether in all cases or only those cases prescribed by the standard instrument), (b) provisions identified in the standard instrument as optional provisions if a decision is made to adopt the provisions when the plan is made. (2) If an optional provision is to be adopted, it is to be adopted without variation (subject to any relevant direction in the standard instrument). An optional provision that is so adopted is the provision as in force under this standard instrument from time to time. (3) If a compulsory provision is not applicable because of the circumstances referred to in the heading to the provision, the number or other identifier of the provision is to be set out in the plan with the the (sic) words '[Not applicable]' or words to the same effect. (4) If an optional provision is not to be adopted, the number or other identifier of the provision is to be set out in the plan with the words '[Not adopted]' or words to the same effect. 13The standard instrument then provides (in Part 2 - "Permitted or Prohibited Development" - commencing at fol 6) for a range of land use zones, including five residential zones, pursuant to cl 2.1, namely: R1 General Residential R2 Low Density Residential R3 Medium Density Residential R4 High Density R5 Large Lot Residential 14Zones R1 and R2 are relevant to the present matter, and the Order (in the Land Use table, commencing at fol 10) provides as follows in respect of them (fols 15-16): Zone R1 General Residential Direction. The following must be included as either 'Permitted without consent' or 'Permitted with consent' for this zone: Roads 1 Objectives of zone · To provide for the housing needs of the community. · To provide for a variety of housing types and densities. · To enable other land uses that provide facilities or services to meet the day to day needs of residents. 2 Permitted without consent Home occupations 3 Permitted with consent Attached dwellings; Boarding houses; Child care centres; Community facilities; Dwelling houses; Group homes; Hostels; Multi dwelling housing; Neighbourhood shops; Places of public worship; Residential flat buildings; Respite day care centres; Semi-detached dwellings; Seniors housing; Shop top housing 4 Prohibited Zone R2 Low Density Residential Direction. The following must be included as either 'Permitted without consent' or 'Permitted with consent' for this zone: Roads 1 Objectives of zone · To provide for the housing needs of the community within a low density residential environment. · To enable other land uses that provide facilities or services to meet the day to day needs of residents. 2 Permitted without consent Home occupations 3 Permitted with consent Boarding houses; Dwelling houses; Group homes 4 Prohibited 15The dictionary to the Order (commencing at fol 49) includes the following relevant definitions: (at fol 50) affordable housing has the same meaning as in the Act. Note. The term is defined as housing for very low income households, low income households or moderate income households, being such households as are prescribed by the regulations or as are provided for in an environmental planning instrument. (at fol 52) boarding house means a building that: (a) is wholly or partly let in lodgings, and (b) provides lodgers with a principal place of residence for 3 months or more, and (c) may have shared facilities, such as a communal living room, bathroom, kitchen or laundry, and (d) has rooms, some or all of which may have private kitchen and bathroom facilities, that accommodate one or more lodgers, but does not include backpackers' accommodation, a group home, hotel or motel accommodation, seniors housing or a serviced apartment. Note. Boarding houses are a type of residential accommodation-see the definition of that term in this Dictionary. (at fol 59) dwelling means a room or suite of rooms occupied or used or so constructed or adapted as to be capable of being occupied or used as a separate domicile. dwelling house means a building containing only one dwelling. Note. Dwelling houses are a type of residential accommodation-see the definition of that term in this Dictionary (at fol 64) group home means a permanent group home or a transitional group home. Note. Group homes are a type of residential accommodation-see the definition of that term in this Dictionary. group home (permanent) or permanent group home means a dwelling: (a) that is occupied by persons as a single household with or without paid supervision or care and whether or not those persons are related or payment for board and lodging is required, and (b) that is used to provide permanent household accommodation for people with a disability or people who are socially disadvantaged, but does not include development to which State Environmental Planning Policy (Housing for Seniors or People with a Disability) 2004 applies. Note. Permanent group homes are a type of group home-see the definition of that term in this Dictionary. group home (transitional) or transitional group home means a dwelling: (a) that is occupied by persons as a single household with or without paid supervision or care and whether or not those persons are related or payment for board and lodging is required, and (b) that is used to provide temporary accommodation for the relief or rehabilitation of people with a disability or for drug or alcohol rehabilitation purposes, or that is used to provide half-way accommodation for persons formerly living in institutions or temporary accommodation comprising refuges for men, women or young people, but does not include development to which State Environmental Planning Policy (Housing for Seniors or People with a Disability) 2004 applies. Note. Transitional group homes are a type of group home-see the definition of that term in this Dictionary. (at fol 78) residential accommodation means a building or place used predominantly as a place of residence, and includes any of the following: (a) attached dwellings, (b) boarding houses, (c) dual occupancies, (d) dwelling houses, (e) group homes, (f) hostels, (g) multi dwelling housing, (h) residential flat buildings, (i) rural workers' dwellings, (j) secondary dwellings, (k) semi-detached dwellings, (l) seniors housing, (m) shop top housing, but does not include tourist and visitor accommodation or caravan parks. (at fols 78-79) residential care facility means accommodation for seniors or people with a disability that includes: (a) meals and cleaning services, and (b) personal care or nursing care, or both, and (c) appropriate staffing, furniture, furnishings and equipment for the provision of that accommodation and care, but does not include a dwelling, hostel, hospital or psychiatric facility. Note. Residential care facilities are a type of seniors housing-see the definition of that term in this Dictionary. (at fol 79) residential flat building means a building containing 3 or more dwellings, but does not include an attached dwelling or multi dwelling housing. Note. Residential flat buildings are a type of residential accommodation-see the definition of that term in this Dictionary. (at fol 81) seniors housing means a building or place that is: (a) a residential care facility, or (b) a hostel within the meaning of clause 12 of State Environmental Planning Policy (Housing for Seniors or People with a Disability) 2004, or (c) a group of self-contained dwellings, or (d) a combination of any of the buildings or places referred to in paragraphs (a)-(c), and that is, or is intended to be, used permanently for: (e) seniors or people who have a disability, or (f) people who live in the same household with seniors or people who have a disability, or (g) staff employed to assist in the administration of the building or place or in the provision of services to persons living in the building or place, but does not include a hospital. Note. Seniors housing is a type of residential accommodation-see the definition of that term in this Dictionary.

The SEPP 16The SEPP (in its original form - tab 3, commencing at fol 064 of the appeal book) includes the following relevant provisions: (at fols 067-8) 3. Aims of Policy The aims of this Policy are as follows: (a) to provide a consistent planning regime for the provision of affordable rental housing, (b) to facilitate the effective delivery of new affordable rental housing by providing incentives by way of expanded zoning permissibility, floor space ratio bonuses and non-discretionary development standards, (c) to facilitate the retention and mitigate the loss of existing affordable rental housing, (d) to employ a balanced approach between obligations for retaining and mitigating the loss of existing affordable rental housing, and incentives for the development of new affordable rental housing, (e) to facilitate an expanded role for not-for-profit-providers of affordable rental housing, (f) to support local business centres by providing affordable rental housing for workers close to places of work, (g) to facilitate the development of housing for the homeless and other disadvantaged people who may require support services, including group homes and supportive accommodation. (at fols 068-9) 4. Interpretation-general (1) In this Policy: ... boarding room means a room or suite of rooms within a boarding house occupied or so constructed or adapted as to be capable of being occupied by one or more lodgers. ... standard instrument means the standard instrument set out at the end of the Standard Instrument (Local Environmental Plans) Order 2006. ... (at fol 070 - with emphasis added) 5 Interpretation-references to equivalent land use zones (1) A reference in this Policy to a land use zone that is equivalent to a named land use zone is a reference to a land use zone under an environmental planning instrument that is not made as provided by section 33A (2) of the Act: (a) that the Director-General has determined under clause 1.6 of State Environmental Planning Policy (Exempt and Complying Development Codes) 2008 is a land use zone in which equivalent land uses are permitted to those permitted in that named land use zone, or (b) if no such determination has been made in respect of the particular zone, is a land use zone in which (in the opinion of the relevant authority) equivalent land uses are permitted to those permitted in that named land use zone. (2) An assessment made by a relevant authority under subclause (1) (b) applies only in respect of the particular development that is proposed to be carried out and more than one such assessment may be made in respect of the same land use zone. (3) In this clause, relevant authority means: (a) the public authority proposing to carry out the development, or on whose behalf the development is proposed to be carried out, or (b) If the development is to be carried out by or on behalf of a person other than a public authority, the consent authority. Note. Land use zones that are named in this Policy are those set out in the standard instrument. (at fols 070-1) 6 Affordable housing Note. The Act defines affordable housing as follows: affordable housing means housing for very low income households, low income households or moderate income households, being such households as are prescribed by the regulations or as are provided for in an environmental planning instrument. (1) In this Policy, a household is taken to be a very low income household, low income household or moderate income household if the household: (a) has a gross income that is less than 120 per cent of the median household income for the time being for the Sydney Statistical Division (according to the Australian Bureau of Statistics) and pays no more than 30 per cent of that gross income in rent, or (b) is eligible to occupy rental accommodation under the National Rental Affordability Scheme and pays no more rent than that which would be charged if the household were to occupy rental accommodation under that scheme. (2) In this Policy, residential development is taken to be for the purposes of affordable housing if the development is on land owned by the Land and Housing Corporation. ... 17Part 2 of the SEPP in its original form (tab 3, commencing at fol 072) dealt with "New affordable rental housing", and was divided into seven divisions, viz:

In-fill affordable housing (cls 10-18)
Secondary dwellings (cls 19-24)
Boarding houses (cls 25-30)
Supportive accommodation (cls 31-3)
Residential flat buildings - social housing providers, public authorities and joint ventures (cls 34-9)
Residential development - Land and Housing Corporation (cls 40-1)
Group homes (cls 42-6) 18In its revised form, the SEPP (tab 4) is relevantly similar. Division 3 (from fol 081, or 137) included the following relevant clauses (fols 081-3, or 137-140 - some emphasis added): 25 Definition In this Division: communal living room means a room within a boarding house or on site that is available to all lodgers for recreational purposes, such as a lounge room, dining room, recreation room or games room. 26 Land to which Division applies This Division applies to land within any of the following land use zones or within a land use zone that is equivalent to any of those zones: (a) Zone R1 General Residential, (b) Zone R2 Low Density Residential, (c) Zone R3 Medium Density Residential, (d) Zone R4 High Density Residential, (e) Zone B1 Neighbourhood Centre, (f) Zone B2 Local Centre, (g) Zone B4 Mixed Use. 27 Development to which Division applies This Division applies to development, on land to which this Division applies, for the purposes of boarding houses. (NB: In its amended form, in tab 4, the following subclauses were added to cl 27 (at fols 137-8 - with emphasis added): (2) Despite subclause (1), this Division does not apply to development on land within Zone R2 Low Density Residential or within a land use zone that is equivalent to that zone in the Sydney region unless the land is within an accessible area. (3) Despite subclause (1), this Division does not apply to development on land within Zone R2 Low Density Residential or within a land use zone that is equivalent to that zone that is not in the Sydney region unless all or part of the development is within 400 metres walking distance of land within Zone B2 Local Centre or Zone B4 Mixed Use or within a land use zone that is equivalent to any of those zones.) 28 Development may be carried out with consent Development to which this Division applies may be carried out with consent 29 Standards that cannot be used to refuse consent (1) A consent authority must not refuse consent to development to which this Division applies on the grounds of density or scale if the density and scale of the buildings when expressed as a floor space ratio are not more than: (a) the existing maximum floor space ratio for any form of residential accommodation permitted on the land, or (b) if the development is on land within a zone in which no residential accommodation is permitted-the existing maximum floor space ratio for any form of development permitted on the land, or (c) if the development is on land within a zone in which residential flat buildings are permitted and the land does not contain a heritage item that is identified in an environmental planning instrument or an interim heritage order or on the State Heritage Register-the existing maximum floor space ratio for any form of residential accommodation permitted on the land, plus: (i) 0.5:1, if the existing maximum floor space ratio is 2.5:1 or less, or (ii) 20% of the existing maximum floor space ratio, if the existing maximum floor space ratio is greater than 2.5:1. ... (Clause 30 provided some "Standards for boarding houses")

The revised SEPP 19The revised form of the SEPP (tab 4) is relevant primarily because it included savings and transitional provisions (cls 54, 54A, and 56 - fols 152-3), in the following terms: 54 Savings and transitional provisions (1) If a development application has been made before the commencement of this clause in relation to development to which this Policy applies and the application has not been finally determined before that commencement, the application may be determined as if this Policy had not been made. (2) Despite subclause (1), a development application that has been made under State Environmental Planning Policy No 10 - Retention of Low-Cost Rental Accommodation before the repeal of that Policy and not finally determined must be determined: (a) if the application is for development has been referred to the Director-General for concurrence under clause 7 of that Policy-in accordance with this Policy except that the prior concurrence of the Director-General is required before consent can be granted to the development application, and (b) in any other case-in accordance with this Policy. (3) Anything done by Housing NSW or the Department of Human Services under clause 16 or 63D (3) of State Environmental Planning Policy (Infrastructure) 2007 in respect of development for a purpose referred to in clause 40 (1) (a) of this Policy is taken to have been done in respect of that development by the Land and Housing Corporation under clause 40 of this Policy. 54A Savings and transitional provisions-2011 amendment (1) Division 1 of Part 2, as in force before its amendment by State Environmental Planning Policy Amendment (Affordable Rental Housing) 2011 (the amending SEPP), continues to apply to development, if: (a) the land on which the development is situated is owned by the Land and Housing Corporation and was owned by that Corporation immediately before the amendment, and (b) the development is commenced not later than 2 years after the amendment. (2) If a development application (an existing application) has been made before the commencement of the amending SEPP in relation to development to which this SEPP applied before that commencement, the application may be determined as if the amending SEPP had not been made. (3) If an existing application relates to development to which Division 1 or 3 of Part 2 applied, the consent authority must not consent to the development unless it has taken into consideration whether the design of the development is compatible with the character of the local area. (4) Despite subclause (2), clause 13 (2) (as in force before the amendments made by the amending SEPP) does not apply to development the subject of an existing application and any such application is to be determined by applying instead clause 13 (2) and (3) as inserted by the amending SEPP. ... 56 Savings and transitional provisions-site compatibility amendments Clause 36, as amended by State Environmental Planning Policy (Repeal of Site Compatibility Provisions) 2011, applies to a development application for development to which Division 5 of Part 2 applies that was made, but not determined, before the commencement of the amendments.

The LEP 20The site involved in this case is zoned Residential "2(a)" or "A" under the LEP (tab 2, p3, cl 8(1)). 21The LEP includes the following relevant provisions. 22The dictionary in Sch 1 (commencing at p44 of 78) contains the following definitions (at pp48, 52, 56, and 58): dwelling means a room or number of rooms occupied or used, or so constructed or adapted as to be capable of being occupied or used, as a separate domicile. dwelling house means a dwelling which is the only dwelling erected on an allotment of land. ... housing for older people or people with a disability means residential accommodation which may take any building form, which is or is intended to be used as housing for the permanent accommodation of older people (persons 55 years old or older) or people with a disability. ... rowhouses means three attached dwellings erected on a corner allotment of a public road with each having a common wall or walls with the adjoining dwelling or dwellings. ... villas means three or more dwellings on a site sharing part of the site for access or open space or site facilities. 23Pursuant to cl 11, the following purposes are permissible with consent in a 2(a) zone: Bed and breakfast establishments Car parks Centre based child care Community facilities Dams Dual occupancies Dwelling houses Educational establishments Family day care centres Family housing Health consulting rooms Home based child care centres Home businesses Home offices Hospitals Housing for older people or people with a disability Landfilling Marinas Places of public worship Public buildings Recreation areas Rowhouses Sanctuaries Utility installations Villas

The Commissioner's judgment 24In some relevant paragraphs ([26]ff) of her judgment (tab 1), Commissioner Morris made the following observations in respect of interactions among the provisions to which I have referred. 25She said (in par [26]), when introducing her section on "Conclusion and findings": Determination of whether the site is within an equivalent zone for the purposes of SEPPARH is a pre-condition to the grant of consent. The Director-General of the Department of Planning has not made a determination in relation to this issue and had that been the case, the applicant, council, the community and the Court would be well placed to understand the application of the policy. As this has not occurred, each application has to have regard to the provisions of clause 5. Clause 5(1)(b) requires the Court to form an opinion whether the 2(a) zone is a land use zone in which equivalent land uses are permitted to those zones named in clause 26. This requires a review of the land uses permitted in the four residential zones contained within the Standard Instrument - Principal Local Environmental Plan (the Standard Instrument) and those uses permitted in the 2(a) zone under the LEP, having particular regard to the definitions as these vary between the instruments. I have undertaken this review and have excluded the Medium Density R3 and High Density R4 zones as being equivalent to the 2(a) zone, particularly because dwelling houses are not permitted in the R3 zone, other than as attached housing which is three or more dwellings and the R4 zone permits residential flat buildings, neighbourhood shops and shoptop housing, uses prohibited in the 2(a) zone and uses that suggest higher density development than that permitted in that zone. Similarly, I have excluded the B1, B2 and B3 zones due to the considerable differences in permitted uses. 26She then went on ([27]) to report on her "more detailed review of the R1 and R2 zones" in the Order, in comparison with "those uses permissible in the 2(a) zone", determined from the list I set out above ([23]). She concluded that the following uses permitted in the R1 and/or R2 zones should be added to that list: Boarding-houses Communications facilities Residential flat buildings Shops (neighbourhood shops only) Vehicle repair stations. 27She then noted (at [28]-[31]): 28. In addition, group homes are permitted with consent in both the R1 and R2 zones and multi-dwelling housing, hostels, and respite day care centres are uses permitted with consent in the R1 zone. 29. The only use common to all three zones is that of a dwelling house and it is clear that the 2(a) zone permits a greater number of land uses (25 in total) than that prescribed in the Standard Instrument in either the R1 (15) or R2 (3) zones. Comparing the R1 and 2(a) zones, uses common to both zones are childcare centres, community facilities, dwelling houses, places of public worship, rowhouses and villas (attached dwellings). A comparison of the R2 and 2(a) zones shows dwelling houses and home offices/businesses/occupations are common however the variation in the number of permitted uses is wide. The Court accepts that it is likely that any council, when adopting its local environmental plan, would add uses to those uses mandated by the Standard Instrument however, that is not a matter that I need to consider. My consideration is limited to that required under clause 5(1)(b). 30. That consideration takes into account the land uses (plural) that are permitted and therefore, regard must be had of the set of uses rather that a direct comparison with individual uses. I have also considered the number of uses, and the nature of those uses however, in my opinion, either manner of assessment would lead to the same conclusion that the 2(a) zone is not equivalent to either the R1 or R2 zones under the Standard Instrument. 31. Mr Rigg, for the applicant, relied on the decision of Tuor C in Chami v Bankstown City Council [2011] NSWLEC 1311 in which the precise question of equivalent zone was considered. On that occasion, the Commissioner concluded the 2(a) zone was equivalent to the R2 zone and, after merit review of the application, upheld the appeal. Mr Rigg urges the Court to have regard to that decision for the sake of comity. 28A crucial finding is also to be found in par [33]: In this appeal, the Court is obliged to undertake a review of the issue of equivalence. I have reviewed the decision in Chami and note that the Commissioner has undertaken a thorough and comprehensive review of the issues, particularly having regard to proper planning principles. However, I consider that, as required under clause 5(2) of SEPPARH, the assessment under subclause (1)(b) applies only in respect of the particular development that is proposed to be carried out and more than one such assessment may be made in respect of the same land use zone. There is an obligation to consider the matter on each occasion an application is before a consent authority. In making my determination on the issue, I do not consider that it is necessary to go beyond considering the permitted uses within the two zones. Accordingly, I am of the view that what is required is that I must form an opinion as to whether the 2(a) zone is a land use zone in which equivalent land uses are permitted, in this case the Residential zones in the Standard Instrument. For the reasons stated above, I have found that they are not. This finding means the development application must fail as the proposed use is prohibited in the 2(a) zone and the provisions of SEPPARH do not apply to the land to which the application relates. 29The learned Commissioner then proceeded to provide a favourable merit assessment of the proposal, in case she were found to be incorrect on the question of permissibility. She applied the savings and transitional provisions (as per Tuor C in Huang & Lei v Parramatta City Council [2012] NSWLEC 1077, at [24]-[25]), and concluded (in [38]): The built form extends some 47 m along the length of the site. While the building is articulated there is no separation between the dwellings or break in the building form. The building is setback 5.5 m from the rear boundary. This setback and the absence of a break in the building do not maintain the 'green zone', which generally exists between buildings in the local area. The side setbacks to the north are used as the primary open space areas for the dwellings and vary in width from about 2.7 m to 4 m. This is different to the orientation of principal private open space in the local area which is generally towards the rear of the dwelling.

The Appellant's Submissions 30Mr Rigg notes (Tp 4, LL 42-9) that the Director General has not made a determination that any particular zones in the LEP are equivalent to named zones in the "standard template". Hence, he argues that cl 5(1)(b) of the SEPP, which supports the objects of the EPA Act, must apply, and be given the interpretation "best supporting" those objects. Clause 5(1)(b) and related parts of the SEPP are "beneficial or facultative and as such should be interpreted as widely as the language will allow", as they are in the public interest (subs pars 12(1) and (2), citing Allen Commercial Constructions Pty Limited v The Council of the Municipality of North Sydney (1970) 123 CLR 490; 20 LGRA 208, per Walsh J at 216; s 35 (a)(viii) of the Act; and cl 3(b) of the SEPP, which speaks of "expanded zoning permissibility". See also Hallidays Point Developments Pty Ltd v Greater Taree City Council [2008] NSWLEC 106, at [28]). 31The SEPP should also be "construed with a flexible and practical approach ... rather than a meticulous comparison of the language ... such as might be appropriate [to] an Act of Parliament" (par 12(3), citing Port Stephens Council v Chan Industrial Pty Ltd [2005] NSWCA 232, at [20]-[21]; (2005) 141 LGERA 226, at 231). 32Adopting a literal approach and "ignoring the proper purpose of the SEPP and cl 5(1)(b) ... could lead to extraordinary results never intended", such as in pars [29] and [30] of the Commissioner's judgment. The words of cl 5(1)(b) are (par 12(4)) "not plain enough to adopt a literal interpretation. A common sense approach is needed", but (par 12(5)) the Commissioner's literal interpretation ([30]) also offended s 8(c) of the Interpretation Act 1987, which applies to the SEPP (by virtue of s 3(1)), and requires interpretation of the "plural" as including the "singular", when she had regard to "the set of uses rather than a direct comparison with individual uses". This was a "legal error". 33Mr Rigg submitted (pars 12(6), (7) and (8)): (6) The Commissioner's failure to accord clause 5 (1) (b) its proper interpretation whether by reference to section 8 (c) of the Interpretation Act; or the aims of the SEPP; or the beneficial or facultative nature of the provision providing for a wide interpretation, or at least giving it a flexible and practical approach, has meant that the counting of numbers approach [29, 30] rendered the Commissioner's decision to be without any requisite or necessary opinion pursuant to clause 5 (1) (b) of the SEPP and in error of law. (7) The Commissioner should have attempted to promote the purpose of the SEPP as expressed in clause 3 thereof and the object underlying section 5 (c) (viii) of the Act. (8) The Commissioner failed to give the proper meaning of clause 5 (1) (b) by reference to the language of the instrument viewed as a whole. The instrument as a whole when read through beneficial or facultative glasses gives no support to the manner of calculating equivalence found in [29, 30] of judgment. 34His submissions then (pars 12(9)and (10)) criticised the "unfairness" of the Commissioner's "simplistic" approach (in [28] - [30]) for failing "to give proper meaning to the concept of 'equivalent' land uses", as a result of her concentration on "numbers or 'a set'" of uses, rather than the broader "accepted and defined" meaning of the word, which would take into account not only number, but "measure, value, effect, position, and function" (as per Macquarie Dictionary, 3rd edition), and would likely be, in the planning context, akin to "having the same result" or "to a similar effect". 35Mr Rigg did, however, acknowledge (in par 12(11)) that: The purpose of the instrument may even require the word and the words within the expression of words to depart from the Dictionary meaning in order to satisfy the other canons of construction discussed above: Project Blue Sky v ABA (1998) 194 CLR 355 at [60] and [78]. Fairness and the intention of the instrument may dictate construction. Further, a definitional provision such as clause 5 (1) (b) should not be interpreted in a manner which would defeat a meaning required by the context and in particular the aims of the instrument: Cranbrook School v Woollahra Municipal Council (2006) 66 NSWLR 379 at [40]. Unreasonable results may require a more natural meaning be discarded: Hecar Investments No. 6 v Lake Macquarie Municipal Council (1984) 53 LGRA 322 at 323. The Commissioner's interpretation failed to find planning logic in the provision and reached a conclusion that the SEPP did not intent (sic); Calleja's case (2005) 142 LGERA 104 at [25] and Chief Commissioner of State Revenue v Qantas Airways Limited [2009] NSWCA 163; 74 NSWLR 181 at [35]. 36There is great diversity in the non-residential land uses permissible in the 2(a) zone, and (subs p 8, par (iv)) "little planning purpose" achieved by focusing on all of them (including dams, landfilling etc, see [23] above). The Commissioner found compatibility in her merits assessment ([35]), but s 8(1) of the Interpretation Act required that she apply "both plural and singular meaning", rather than find a "numerical result without planning or rational purpose" (see subs p8, par (v)). 37In his oral submissions (Tp8, L43 - p9, L21) Mr Rigg summarised the Commissioner's alleged error in these terms: The learned Commissioner has not given the definitional provisions in cl 5(1)(b) a wide interpretation. She has not take into account the object of the Act. The aims of the policy, the SEPP and the mischief was seeking to overcome. She adopted essentially a counting exercise where the comparison is in the numbers of land users contained in the 2A zone compared to the number of land users permissible in the R1 and R2 zone. ... She's given a very, very restrictive interpretation which logically doesn't, with respect, make sense. ... ... the Commissioner had taken the approach with clause 5(1)(b) of adopting a literal meaning rather than the legal meaning.

The Respondent's Submissions 38Mr Galasso submits that the Commissioner's decision is correct, and, if I find that she applied the correct test under cl 5(1), her opinion stands. It is not for this court on the s 56A appeal to determine whether there is equivalence, but whether, as a matter of law, the Commissioner applied the correct principle/test: Brinara Pty Ltd v Gosford City Council [2010] NSWLEC 230; 177 LGERA 296, at [28] - [33]; Collector of Customs v Pozzolanic Enterprises Pty Ltd [1993] FCA 322; 115 ALR 1, at 8. He says (subs par 16): Once land uses which are permitted within the identified zones are identified, the task prescribed in clause 5(1)(b) is for the consent authority (in this case the Commissioner) to form the opinion that in the Residential 2(a) Zone 'equivalent land uses are permitted'. The comparison exercise involves, firstly, identifying what those land uses are that are permitted in the Residential 2(a) Zone, and then forming an opinion as to equivalents with the identified zones. 39Determination of "equivalence" in land use zoning is a precondition to granting consent to the present application. It is common ground that only R1 and R2 are relevant. Like Mr Rigg, given that the term is not defined in the SEPP, and was chosen by the draftsperson ahead of terms such as "identical" or "similar", Mr Galasso went to the Macquarie Dictionary for definitions of "equivalent", namely:

equal in value, measure, force, effect, significance, etc;
corresponding in position, function, etc... 40The outcome is (subs pars 19-20) that cl 5(1) requires the consent authority to form an affirmative opinion "that in the actual zone land uses are permitted which are equivalent to those which are permitted in the named zone. Self-evidently, this involves a component of comparison, but also a component of value judgment". That the Commissioner did so correctly is, it is submitted, clear from pars [26] - [33] of her judgment, and her conclusion (in [30]) that the 2(a) zone was not equivalent to either R1 or R2, "whether as a function of the number of uses or the nature of them", was also correct. 41The terms of s 5(1) are clear, and spell out constraints or limitations on the exercise to be performed, and they cannot be disregarded because of an interpretation given to the liberal, beneficial or facultative function of the SEPP, or to the objects of the Act itself. The discretion in cl 5 for boarding houses is to be contrasted with the more objective formulations for other types of affordable housing elsewhere in the SEPP (Tpp15-18). 42Mr Galasso submitted that, if uses were the subject of direct individual use-by-use comparison, "there would probably never be an equivalent land use zone" (subs par 35(5)). During oral submissions, he said (Tp12, LL8-16, and 27-33) ... it's a comparison exercise for each of the zones. It involves identifying the zones, it involves identifying the land uses that are permitted in the two zones and the final step involves forming the opinion as to whether equivalent land uses are permitted to those permitted in the named zones, nothing more than that, nothing less than that. To qualify that process by saying that it involves getting a feel for the zones, getting a vibe from the zones, having a look at the objectives of the SEPP, having a look at the objectives of the Act we submit is to amend without proper justification, the clear words of the clause. ... the comparison exercise starts with the named zone for the purposes of this application the named zone is one of the zones identified in 26A through to G, they are the R1, R2, R3, R4, B1, B2 or B4 zones and gives to the consent authority as a matter of, not only quantitative but qualitative assessment for the task of forming the view, or to use the terminology within the clause forming the opinion, that equivalent land uses are permitted in one to the other. Later he added (Tp14, LL30-33) ... you can get an affirmative answer on any of the named zones. So it doesn't matter whether it's R1 or R2 or R3 or R4 or B4 for that matter. You just need to get an affirmative answer on one of them. So in many respects you do a number of these comparative exercises. 43Mr Galasso's written submissions concluded (in par 36): ... to focus upon land uses which are permissible in each of the relevant zones is entirely the task resented by clause 5(1). The Appellant's submissions seek to ignore this undoubted task. Furthermore, the task in clause 5(1) has nothing to do with 'establishing affordable housing in a particular zone'. It is in fact the SEPP which will establish affordable housing in a particular zone, provided it has equivalent land uses to a named zone. That has nothing to do with affordable housing; but has everything to do with equivalent permitted land uses, as the threshold to the application of the SEPP. 44As the learned Commissioner, clearly from the words of her judgment, formed a relevant opinion, ground (2)/prayer 7 of the appeal must fail, and, as she clearly applied the correct test, ground (1)/prayer 6 must also fail.

Consideration 45There is much to commend purpose construction and the various articulations of the relevant principles, but, in this case, the purpose of the SEPP is to facilitate more affordable housing in various ways, depending upon the planning principles applying to different areas and different types of affordable housing ([17] above). 46To this end, cl 5 is formulated in a quite specific way, distinct from the way other provisions relevant to different areas and types of affordable housing (in the other six divisions of Part 2 - [17]) are formulated. 47Strict adherence to the precise terms of each provision is clearly mandated by the structure and terms of the instrument itself, and neither works a mischief, nor leads to an absurdity. In those circumstances it is wrong to go behind the provisions, or to read additional matter into them. 48The analysis and submissions advanced by Mr Galasso, for the respondent, are clearly to be preferred, and the application of the instruments by Commissioner Morris was clearly correct.

Conclusion 49The appeal is dismissed with costs, and the appeal book is retuned to the appellant.

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: 21 September 2012

(2005) 141 LGERA 226

(2005) 142 LGERA 104

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