25D Power to grant another development consent
Nothing in this Division prevents the grant of another development consent in relation to the same matter, during or after the period of suspension, pursuant to a development application duly made.
25E Duty of Court
It is the duty of the Court to consider making an order under this Division instead of declaring or determining that a development consent to which this Division applies is invalid, whether in whole or in part.
6 Section 103 and s.104 of the EP&A Act provide as follows:
103 Revocation or regrant of development consents after order of Court
(1) This section applies to a development consent granted, or purporting to be granted, by a consent authority, to which an order of suspension applies under section 25B of the Land and Environment Court Act 1979.
(2) The consent authority may revoke a development consent to which this section applies, whether or not the terms imposed by the Court under section 25B of the Land and Environment Court Act 1979 have been complied with.
(3) However, if the terms imposed by the Court have been substantially complied with, the consent authority may revoke the development consent to which this section applies and grant a new development consent with such alterations to the revoked consent as the consent authority thinks appropriate having regard to the terms themselves and to any matters arising in the course of complying with the terms. Such a grant of a development consent is referred to as a regrant of the consent.
(4) No preliminary steps need be taken with regard to the regrant of a development consent under this section, other than those that are required to secure compliance with those terms.
(5) Section 81 and such other provisions of this Act as may be prescribed by the regulations apply to development consents regranted under this section.
104 Appeals and other provisions relating to development consents after order of Court
(1) A development consent declared to be valid under section 25C of the Land and Environment Court Act 1979:
(a) is final and the provisions of sections 97 and 98 do not apply to or in respect of it, and
(b) is operative as from the date the development consent originally took effect or purported to take effect, unless the Court otherwise orders.
(2) A development consent declared under section 25C of the Land and Environment Court Act 1979 to be validly regranted:
(a) is final and the provisions of sections 97 and 98 do not apply to or in respect of it, and
(b) takes effect from the date of the declaration or another date specified by the Court.
7 Jagot J has helpfully summarised the scheme as follows (see Mid Western Community Action Group Incorporated v Mid-Western Regional Council & Anor (No 2) [2008] NSWLEC 143 ("Mid Western No.2") at [16]):
It is apparent that the scheme commences with a single consent affected by some defect. Instead of declaring that consent invalid, it may be suspended on terms imposed by the Court. Once the terms have been satisfied the consent authority may decide whether: - (i) to revoke the suspended consent (s 103(2)), or (ii) any alteration to the consent is required having regard to the terms and matters arising in the course of complying with the terms (s 103(3)). If the consent authority does not revoke the consent or consider any alteration is required then the consent may become operative only by the making of orders and declaration under s 25C(1). Such a consent operates from the date of the original grant of consent unless the Court otherwise orders (s 104(1)). If the consent authority does not revoke the consent but does consider an alteration is required then the consent may be revoked and a new consent regranted in accordance with s 103(3). Such a regrant is protected from any requirement for preliminary steps to be taken other than steps required to comply with the terms of the orders under s 25B. The language of s 25B(1)(b) (which refers to validating the consent whether without alterations or on being regranted with alterations), the cumulative declarations and order in s 25C(2), and the provisions of s 104(2) disclose that a regranted consent takes effect as a consequence of the Court exercising its functions under s 25C(2). As Stockland submitted, the scheme treats suspended and regranted consents the same. Differences in descriptions apparent from comparing s 25C(1)(b) and s 25C(2)(b) and s 104(1) and s 104(2) are not material to this issue. It would be odd if a consent authority would be able to avoid the Court's supervisory role merely by making some alteration to the consent. Section 104(2)(b), moreover, is clear and must be taken to mean what it says. These considerations also confirm the difficulty with an alternative submission made on behalf of the Action Group that a declaration under s 25C(2)(a) (that the terms have been complied with) would be sufficient of itself to render the regranted consent operative.
Discussion
8 The procedural fairness ground in this case turned on the Council's policy of ignoring any advices as to the change of ownership of rateable properties, other than an official Land Titles Office advice of the registration of a new registered proprietor. The Applicants relied on the despatch by their solicitors of a letter to Council advising of the settlement of their purchase. The Council's Points of Defence declined to admit receipt of the letter, but a late affidavit by Council's Mr Lloyd (filed a few days before the original hearing) explained Council's failure to act upon the letter by reference to the policy, which then became the focus of much attention at the hearing and in my judgment.
9 The Applicants did not learn of the July 2006 consent until about March 2007. Their solicitors then wrote to the Council about the lack of notification of the development application, and the consequent denial of an opportunity to make any objection or submission during the assessment process.
10 The correspondence now before the Court shows that Council then raised with Ms Eilbeck the strong possibility of a successful challenge to the consent, on the basis of its admitted failure to act on the letter advising change of ownership, and invited her to consider lodging a fresh development application "which would then be notified to your neighbours, who will be entitled to review the plans and make a written submission …" (see Exhibit C1 - letter of 4 April 2007). The Third Respondent did not respond to Council's invitation.
11 The Applicants commenced these proceedings on 2 July 2007, and the pleading process unfolded with both Respondents strongly defending the assessment process and the consent. On 17 September 2007 solicitors for the Council wrote to the solicitors for the Third Respondent in the following terms:
" We refer to our respective clients' points of defence and note that both our clients seek similar orders under Division 3 of Part 3 of the Land and Environment Court Act 1979 (Act):
1. suspending the operation of the consent;
2. specifying terms compliance with which will validate the consent; and
3. on those terms being followed and application being made by our client, an order under section 25C of the Act declaring that the consent is valid.
Our client considers that a satisfactory and more cost-effective outcome can be reached for both our clients, without the need to resort to pressing on towards a hearing of the proceedings and our clients' applications for the above orders, if, with the knowledge of the applicants:
1. your client lodges a fresh development application with our client;
2. our client waives the relevant development application fee(s);
3. our client notifies the applicants of the fresh development application and gives them the opportunity to make submissions, notwithstanding the fact that no such notification is required by its Development Assessment and Compliance Notification Policy;
4. our client determines the fresh development application accordingly; and
5. if the fresh development application is determined by granting consent, your client surrenders the consent the subject of these proceedings.
For your client's benefit in considering whether to lodge a fresh development application, we note the following in respect of changes to the relevant planning controls since the granting of consent to the original development application:
1. Our client's Design Guidelines for Residential Dwelling Developments in the 7(c) Environmental Protection Residential Zone have been repealed and would not apply to any fresh development application.
2. Our client's Development Control Plan No. 49 - Residential development would apply to any fresh development application. Of particular application would be section 9 of that document, which details additional standards for the erection of a dwelling within a non-urban or environmental protection zone.
The invitation made by our client is made without any admission as to liability or invalidity of the consent the subject of these proceedings. We note that by way of letter dated 4 April 2007 our client gave a similar invitation to your client (enclosed). If your client elects not to lodge a fresh development application, our client proposes to tender these 2 letters to the Court on the question of costs should that issue arise later in the proceedings."
12 It needs to be remembered that these proceedings concern a domestic redevelopment in a residential area, and the dispute fuelled between two neighbours is a direct consequence of failures on the part of the Council, which have now been proven to the Court. The Applicants were denied the opportunity of being heard on their concerns, but some of the Council's other failures, convincingly articulated at the hearing, remain protected by s.101.
13 The Applicants, having succeeded in their strongly contested challenge to the consent, oppose the making of a s.25B order, while the Respondents urge it upon the Court as the most appropriate course of action. Both Respondents have submitted drafts of orders they consider should be made.
Submissions
14 Mr Galasso, appearing for the Applicants in the present case, says (T6, L33ff) that the Court should not move into Division 3 "simply because one can formulate the matters that ought to be considered". His fundamental position is that a consent granted in this case, in denial of procedural fairness to a key stakeholder, is so infected by error - especially when its other proven flaws are considered - that it should be declared invalid. Section 25E imposes a "duty to consider", but s.25B makes it clear that the Court has a discretion - a pure and broad discretion. An order under s.25B should not be made simply because it is possible to formulate one. His clients are entitled to a true and proper reconsideration of the whole Eilbeck proposal, and, in order for that to occur, the declaration of invalidity should be made. The development application as presented originally is still on foot and can be properly reconsidered by the Council. Even with Court supervision under s.25B, the Council could grant, in his submission, only a token hearing to the Applicants if such an order were made.
15 In his submissions for the Council, Mr Fraser put to the Court some of the advantages of a s.25B order - e.g. the setting of a firm timetable, the requirement for Court supervision of the outcome, and the opportunity to propose complete re-notification. It would open up the s.79C process again to any submission that anyone wished to make. There is no restriction on the breadth of the order possible so it could embrace those matters already protected by s.101. Pearlman J's decision in Glowpace Pty Ltd v South Sydney City Council [2000] NSWLEC 220 ("Glowpace") shows that a s.25B order can be appropriate where procedural fairness is found to be denied. He said (at T15, L32-33): "the fact that it's a serious matter doesn't make s.25B inappropriate". Mr Fraser even argued that it may be even more appropriate in those circumstances.
16 I took Mr To, for the Third Respondent, to be asserting, on the basis of Midwestern No.2, that there should be a presumption in favour of the use of s.25B. He said (at T16, L19, quoting Jagot J): "to find that process inappropriate requires the finding of principled reasons why orders should not be made". He also said that s.25B is not limited to issues which are not blocked by s.101. Once invalidity is established, the Court can craft a process that requires the doing of steps of any kind. The process is, therefore, responsive to the practical concerns of both the applicant in the proceedings and the applicant for the consent. Mr To even conceded that I could amend his draft order to require full neighbour re-notification, or at least re-notification of the adjacent neighbour to the North of the site, Ms O'Donnell, who claimed not to have been notified on the first occasion, but was not involved directly in the proceedings.
17 In reply, Mr Galasso submitted that it was not the nature of the development, but the nature of the flaw in the consent, that should determine whether or not to use s.25B. The Council has argued for full re-notification, but may as well have the declaration struck down and start again. He had been criticised for not submitting an alternative draft order, but the Applicants' position has consistently been, and remains, that Division 3 is not an appropriate response to this case. If the consent is declared invalid, the original DA (or some amended DA) can be (re)assessed, and the Council will have to consider what the Court has said in respect of the original decision.
Consideration
18 There was for a time a difference in view within the Court as to whether the scope of Division 3 was limited to, for example, cases where the defect in the consent lay in steps preliminary to its being granted. The Court of Appeal firmly resolved those differences in Kindimindi Investments Pty Ltd v Lane Cove Council and Another (2007) 150 LGERA 333 ("Kindimindi"). The three appeal judges (Hodgson, Tobias and McColl JJA) expressed themselves differently, but the thrust of the decision is clear from the headnote:
Held: (dismissing the appeal)
(1) The division should not be limited to the particular kind of invalidity specified in s 25A(2) .
(2) The use of the word "extends" in s 25A(2) , is a strong indication that the section was not intended to be an exhaustive indication of the type or types of invalidity to which the division applies. If the section had used the word "applies", or "applies only", then that may have been the intention disclosed.
(3) There seems no logic in selecting that particular type of invalidity, rather than any type of invalidity that might affect a development consent or purported development consent. The general intention was that technical breaches should be capable of being rectified, and there can be technical breaches which are not matters arising from preliminary steps.
(4) There is some uncertainty as to the scope of steps preliminary to the granting of a development consent. It is not entirely clear whether that would include the requirement that consideration of certain matters take place. If it does extend to the requirement of consideration of certain matters, then the lack of logic in separating out preliminary steps from other matters becomes even clearer.
(5) That s 25A(2) should not be given that limiting effect appears from s 25E . That section requires the court to consider the making of an order under the division in relation to development consents to which this division applies, that is, all development consents falling within s 25A(1) . That would be a little strange if the division was only intended to apply to particular types of invalidity.