City of Sydney Council v Gravity Corporation Pty Limited

City of Sydney Council Applicant v Gravity Corporation Pty Limited Respondent

By an amended summons issued in class 5 of the Court's jurisdiction, the prosecutor claims two orders requiring the defendant, Gravity Corporation Pty Limited ('Gravity"), to answer the following charges:- 1. That prior to 31 January 2000 it did carry out development being the erection of a building without development consent on land known as 365 George Street, Sydney contrary to s 76A(1)(a) of the Environmental Planning and Assessment Act 1979 ("the EP&A Act"); and 2. That prior to 31 January 2000 it did commence and carry out the erection of a building on land known as 365 George Street, Sydney without obtaining a construction certificate contrary to s 81A of the EP&A Act.

The charge that the defendant carried out development without development consent relates to demolition of the southern wall of the original ANZ vault to create an opening between the proposed female toilet and the plant room, demolition of the level six ceiling, configuration of an apartment on level four, construction of level seven, eight and nine slabs higher than the approved level and the construction of a roof slab higher than the approved level.

The remaining and separate charge is particularised as the "Demolition of the southern wall of the original ANZ vault" and the "Configuration of apartment H on level 4" .

The defendant has entered a plea of guilty in each case.

Separate charges have been laid in matters No 50083 and 50083A of 2000 against the company Politic Pty Limited ("Politic"). The charges in the other matters relate to later work on the same building. Although the matters have been heard together, separate judgments are delivered.

Common facts underlie both proceedings, however, the respective charges made against the two companies are distinct and the facts supporting the proof of the commission of the offence in the terms of what was done, otherwise than in accordance with the provisions of the EP&A Act, are unique in each case. This judgment will identify the common findings of fact and then proceed to deal with the facts which relate only to the charges against Gravity.

Development consent D/DB/96/00585H which allows for the demolition of the existing buildings at 357, 359 and 361 George Street, the refurbishment of buildings at 22, 24 to 26 York Street and 365 George Street and the construction of a 33 level commercial tower was granted to Australian Growth Properties by the prosecutor on 19 December 1996 ("the 1996 consent"). A building approval No B199700578 was issued on 11 September 1997 ("the 1997 approval").

Politic acquired the property on 23 August 1999.

The development consent was modified a number of times, pursuant to s 96 of the EP&A Act, with an approval for the final modification being granted on 24 December 1999.

The building at 365 George Street is designated as the ANZ Bank Building (formerly the ES&A Bank Building). Mr Edmund Blacket created the original design and the building is recognised as a heritage item under the Sydney Central Local Environment Plan 1996. It is part of the National Estate and classified by the National Trust.

Building works were commenced, relying upon development consent D/DB/96/00585H, prior to the acquisition of the property by Politic.

Between 4 August 1999 and 10 April 2000 various meetings and telephone conversations were held between representatives of Politic and the prosecutor in respect of the original development consent.

Amended drawings were lodged with the City of Sydney Council ("the council") between 25 October 1999 and 3 March 2000. On 10 April 2000 the council granted a further development consent D99/00562 ("the 2000 consent"), in favour of Politic, approving the change of use of the heritage building at 365 George Street from commercial use to commercial/serviced apartments use and the construction of a roof addition comprising a structural transfer system, two levels of serviced apartments and a plant room.

Subsequent to its acquisition of the property on 23 August 1999, Politic carried out work on the ground floor and banking chamber.

Following an inspection of the building on 27 July 2000 by council officers all works ceased at the request of the council.

On 2 August 2000, Politic lodged an application for a construction certificate for future works.

On 21 August 2000, Politic lodged an application for a building certificate in respect of works that had already been carried out.

On 7 November 2000, Politic commenced class 1 proceedings in this Court by way of an appeal against the prosecutor's deemed refusal of the application for a building certificate and the application for a construction certificate. As a result of discussions between the two parties a building certificate and a construction certificate were issued pursuant to consent orders made on 11 January 2001.

The following facts are set out in a statement of agreed facts and establish the ingredients of each offence:- Gravity caused part of the southern wall of the original ANZ vault to be demolished to create an opening between the proposed female toilet and the King Street plant room without development consent … and without a construction certificate…

Gravity caused part of the Level 6 ceiling between grids 1 and 4 to be demolished without development consent…

Gravity caused the internal configuration of apartment H on level 4 to be built in a manner for which it did not have development consent … and without a construction certificate… The anomaly has been rectified in accordance with the 2000 Consent and the Construction Certificate.

Gravity caused the level 7 slab to be constructed 0.98 metres higher than the approved level…

Gravity caused the level 8 slab to be constructed 0.98 metres higher than the approved level …

Gravity caused the level 9 slab to be constructed 1.02 metres higher than the approved level …

Gravity caused the roof slab to be constructed 1.12 metres higher than the approved level …

Each of the works identified in paragraphs 24 - 30 was carried out in the period up to 31 January 2000.

Gravity entered into a lease with Politic on 1 September 1999, which included levels three to eight and the basement of the property known as 365 George Street, Sydney.

The 2000 consent subsequently provided for the conversion of the upper floors of the property into serviced apartments.

James Bilios, the Managing Director of Gravity, explained that the creation of an opening between the proposed female toilet and the plant room was necessary in order to comply with the relevant provisions of the Building Code of Australia ("the BCA") and the Disability Discrimination Act 1992 (Cth). He notes that conditions one and two of Schedule 2 of the Notice of Determination dated 10 April 2000 now provide that the works must comply with the BCA. Following notification of the council's concern, Mr Bilios agreed, on behalf of the company, to finish the opening in such a manner as to make it a feature of the depth of the opening by polishing the "reveals" .

Susan Duyker, a heritage consultant employed by the prosecutor, stated in an affidavit that the demolition of sections of the vault wall diminishes the heritage significance of the building. However, interpretation of the former configuration of the vault wall will go some way towards compensating for the loss.

Mr Bilios also says in his affidavit that the majority of all the ceilings in the existing building were demolished or derelict prior to any involvement of Gravity with the property.

John Michael McInerney is a principal of City Plan Services. Mr McInerney has provided town planning advice in respect of the property at 365 George Street. In his opinion, the primary objectives of fixing the height of new levels above the roof slab of the existing building is to ensure, firstly, that the additional levels are not visually obtrusive when viewed from street level and, secondly, that the heritage significance of the existing structure is maintained. Furthermore, in his opinion, the various levels which exceed the approved height, identified in the particulars of the charge, are not perceivable from the immediate public domain and do not have any adverse urban design or heritage consequence even when subject to the most detailed scrutiny. The council appears to accept this assessment or, at least, does not contest it. It is conceded that the overall height of the building has not been increased.

The reconfiguration of apartment H on level four was admittedly carried out without development consent and without a construction certificate. Mr McEwen SC, on behalf of the council, told the Court that the council's concern in this respect related to the prospect that the changed configuration could lead to use as a hotel room rather than the approved use as a serviced apartment. As noted in the agreed statement of facts, the anomaly has been rectified and this part of the building now complies with the 2000 consent and the construction certificate.

The first return of the summons was on 6 February 2001 and a plea of guilty was entered on 26 April 2001 when the matter was mentioned before the list judge for the sixth time.

There is no explanation for the delay in entering the plea of guilty, however, equally, there is no suggestion that it was not entered promptly. The defendant facilitated and expedited the hearing by agreeing to a statement of facts which established the ingredients of each offence. The only further evidence necessary was to establish the defendant's claim for mitigation.

Although there is no excuse for carrying out the work to the southern wall of the ANZ bank vault without the requisite authority, there is, nevertheless, a rational explanation that it was necessary to meet the requirements of the BCA and the provisions of the federal legislation that provides for the use of the toilets by disabled persons.

The consequences of the increase in the existing roof slab height and the levels above does not detract from the heritage significance of the existing building and is not discernable from the public domain. Again, in this respect, Gravity has provided a plausible explanation although no excuse has been provided for proceeding with that work contrary to the provisions of the EP&A Act.

Although the Court does not attribute a sinister motive to the actions of Gravity, it nevertheless is satisfied that the offences occurred with the full knowledge of the defendant. The incidents cannot be attributed to oversight or inadvertence.

The offences by Gravity all occurred before 1 February 2000 from which date the penalty for a breach of the EP&A Act, in this respect, was increased from $110,000 to $1,100,000.

The Court accepts the submission made by Mr McEwen SC, on behalf of the council, that there is a heightened responsibility on the developer of a property who is carrying out work in respect of an item which has heritage significance.

It is appropriate to apply the totality principle to ensure that the total fine does not exceed a penalty consistent with the overall criminality involved.

The maximum penalty must be regarded as being reserved for the worst possible scenario. There can be no suggestion that the offences committed by Gravity are in that category.

Having regard to the minimal impact of the breaches and that a reasonable explanation has been forthcoming in respect of at least the removal of the vault wall and the increase in height, it is appropriate to assess the penalty at the lower end of the range after taking into account the utilitarian value of the plea of guilty and the co-operation of the defendant in the preparation of a statement of agreed facts.

The Court is satisfied that a total fine in the sum of $30,000 is appropriate to the whole of the circumstances.

In matter No 50085 of 2000, where it is alleged that the defendant carried out development without development consent, the Court finds the offence proved. The defendant is convicted and fined the sum of $25,000.

In matter No 50085A of 2000 the Court finds the offence proved. The defendant is convicted and fined the sum of $5,000.

The Court makes the following orders:- (1) In matter No 50085 of 2000 the defendant is convicted of the charge in the summons.

(2) The defendant is ordered to pay a penalty in the sum of $25,000 in matter No 50085 of 2000.

(3) In matter No 50085A of 2000 the defendant is convicted of the charge in the summons.

(4) The defendant is ordered to pay a penalty in the sum of $5,000 in matter No 50085A of 2000. (5) The defendant is ordered to pay the prosecutor's costs as agreed or assessed.

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.