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CVA Apartments Pty Ltd v Burwood Council; Marsden Hotel Burwood Pty Ltd v Burwood Council; The Marsden Hotel Pty Ltd v Burwood Council - [2020] NSWLEC 11 - NSWLEC 2020 case summary — Zoe
Marsden Hotel Burwood and Others Seek a Stay of Emergency Development Control Orders Issued by the Council
By notices of motion filed 7 February 2020, the applicants in three Class 1 appeals seek a stay of the operation of three Development Control Orders issued by the respondent, Burwood Council ("the Council") on 24 January 2020 ("the Orders").
The three Class 1 appeals, each filed on 4 February 2020, seek to revoke or modify the Orders.
The Orders require the applicants to stop using the building at 50-60 Burwood Rd, Burwood ("the premises"), for the purpose of apartments, a hotel, a restaurant, a café and associated uses, until such time as a valid occupation certificate is issued for the premises.
The terms of each of the Orders were identical and are relevantly as follows:
Circumstances
The building is being used in contravention of a planning approval, namely the building is being occupied without no valid occupation certificate having first been issued, and therefore in contravention of planning approval BD.2015.092
Terms of the Order
Council orders you, pursuant to the said Act, to:
1. Stop using the building known as 60 Burwood Road Burwood NSW 2134 (Lot 333 DP 1243533) for the purposes of a hotel, restaurant, café and associated uses until such time that a valid Occupation Certificate is issued for the premises;
THIS IS GIVEN IN AN EMERGENCY
YOU ARE REQUIRED TO COMPLY WITH THIS ORDER FORTHWITH.
Reasons for the Order
The reason(s) for making this Order are that:-
1. Building works are still being carried out at the premises. As such, Council is concerned that the premises may not be safe for occupants of the building inclusive of staff, hotel guests and their visitors and restaurant customers;
2. Occupation without a valid occupation certificate results in there being no compliance certificates and other necessary documents by which Council can be assured that occupation of the premises poses no danger to occupants inclusive of staff, hotel guests and their visitors and restaurant customers;
3. In the absence of a valid occupation certificate and associated documents Council has no means of ensuring that building works have been properly assessed for compliance with relevant development standards and the Building Code of Australia;
4. Council is responsible for orderly development within the Burwood Local Government Area. The absence of a valid occupation certificate results in Council not being informed that the development has been conducted in an orderly and proper manner or that the building is fit for use as a hotel and restaurant;
5. No fire safety certificates have been received by Council. Such certificates are to be submitted to Council in company with an occupation certificate and other documents. Accordingly, fire safety is an issue and the fire safety of occupants inclusive of staff, hotel guests and their visitors and restaurant customers cannot be assured.
6. The lack of an occupation certificate and associated documentation results in there being no proof that the swimming pool on the roof of the hotel is built in accordance with the relevant standards, complies with the Swimming Pools Act, complies with all access standards and complies with all safety requirements.
Non Compliance
It is an offence not to comply with the Order, and the maximum penalty for such offence for a corporation is not exceeding $5,000,000 and to a further daily penalty not exceeding $50,000. In the case of an individual the maximum penalty for such offence is not exceeding $1,000,000 and to a further daily penalty not exceeding $10,000.
If the Order is not complied with, the Council may carry out the work and recover the costs of doing so from you.
A related Class 4 matter commenced by the Council on 31 January 2020, seeks declaratory and injunctive relief in respect of the purported issuing of an Interim Occupation Certificate ("IOC") for the premises by Mr Valerio Lilli, a building certifier, on 23 December 2019.
No interim injunctive relief was sought by the Council in the Class 4 proceedings.
According to his affidavit sworn on 14 February 2020, Mr Lilli was the principal certifying authority ("PCA") for the premises. He issued construction certificates ("CC") for the premises on 4 June and 4 October 2019.
In his affidavit Mr Lilli deposes that he did not issue the IOC for the premises notwithstanding that the document purporting to be the IOC sent to the Council bears his signature and appeared to have been emailed from his email address and signed off by "Vic Lilli" "Director" of "Vic Lilli & Partners". Mr Lilli claims that he considers the IOC to be "a fake". In particular, he notes that he could not have issued the IOC because as at 23 December 2020, his accreditation had been suspended (although the suspension has since been stayed by NCAT: see Lilli v Building Professionals Board [2019] NSWCATOD 193).
When the matter came before me on 14 February 2020 (as a referral from the Registrar in my capacity as duty judge), I determined that a stay on conditions ought to be granted in respect of the Orders, and moreover, that, with the consent of all parties to those proceedings, the final hearing of the Class 4 proceedings should be expedited. This is because the Class 4 proceedings will, irrespective of the outcome, be determinative of the three Class 1 appeals (agreed by the parties). Because I had other matters to deal with after the hearing of the stay application that concluded at 4pm, brief oral reasons were given for my decision with the promise of more fulsome written reasons to be delivered later. These are those reasons.
[3]
The Council Issues the Stop Use Orders
The Orders were issued by the Council pursuant to s 9.34 of the Environment Planning and Assessment Act 1979 ("EPAA") and are nominated as Order No 1 in the Table in Sch 5 as a "stop use" order. Section 9.34 is in the following terms:
9.34 Orders that may be given
(1) The development control orders that may be given under this Act are as follows -
(a) general orders in accordance with the table to Part 1 of Schedule 5,
(b) fire safety orders in accordance with the table to Part 2 of Schedule 5,
(c) brothel closure orders in accordance with the table to Part 3 of Schedule 5.
(2) The regulations may amend those tables.
(3) A reference in those tables to a planning approval is a reference to a development consent, an approval for State significant infrastructure or a certificate under Part 6 (other than a compliance certificate).
Section 8.18 of the EPAA provides for a right of appeal against the issue of the Orders:
8.18 Appeals concerning orders
(1) A person who is given a development control order may appeal to the Court against the order.
(2) However, a person may not appeal against a fire safety order given by an authorised fire officer (other than an order that prevents a person using or entering premises).
(3) The appeal may be made only -
(a) within 28 days after the development control order is given to the person, or
(b) if an order is given subsequently that forms part of the development control order, within 28 days after the subsequent order is given to the person.
(4) On hearing an appeal, the Court may -
(a) revoke the development control order, or
(b) modify the development control order, or
(c) substitute for the development control order any other order that the relevant enforcement authority who gave the order could have given, or
(d) find that the development control order is sufficiently complied with, or
(e) make such order with respect to compliance with the development control order as the Court thinks fit, or
(f) make such other order with respect to the development control order as the Court thinks fit.
[4]
The Operation of the Hotel, the Issuing of the IOC and the Events Giving Rise to the Issuing of the Orders
The background to this application is set out in the unchallenged affidavit of Mr Matt Sonter, solicitor for the applicants, affirmed on 7 February 2020 ("the first Sonter affidavit").
The premises are described as Lot 333 DP124533. The premises are subject to the Burwood Local Environmental Plan 2012. Under that planning instrument they are zoned B4 - Mixed Use.
Constructed on the premises is an 11 storey mixed use development. The ground floor of the building contains a restaurant, café, and servicing area back-of-house facilities. Levels 1-10 comprise a hotel containing 91 rooms.
The building on the premises is operational, with the ground floor restaurant and café tenancies trading and the hotel component occupied.
[5]
The Development Approval History
On 25 November 2016 the Council granted development consent to DA 92/2015 ("the DA") approving a mixed use building of nine storeys comprising four ground floor retail commercial premises units, two basement levels of car parking and 42 residential apartments.
On 28 March 2018 the Council approved a modification of the DA under s 4.55 of the EPAA, which provided for an additional two basement levels and the inclusion of allocated areas for necessary mechanical and services equipment.
On 24 January 2019 the Council approved a further s 4.55 modification of the DA which provided for the amendment of the use of level 1 from residential to commercial, reduction in the unit numbers from 42 to 36, various internal alterations to common and service areas, and alterations to the facade and roof features.
On 14 August 2019 the Council granted consent to development application DA 2019.017 for the change of use from a mixed 11 storey commercial residential building to a 91 room hotel with basement parking.
[6]
Construction and Certification of the Building
A CC was issued by Phoenix Building Approvals Pty Ltd ("Phoenix") on 2 March 2018 for the construction of the building approved by the DA.
On 29 June 2018 a further CC was issued by Phoenix for the building and incorporated works approved by the modification of the DA which included an additional two basement levels and service and equipment area.
A complying development certificate was issued for office fitout works on 5 March 2019.
On 12 April 2019 a notice of change of appointment of the PCA for the site was executed by the then certifier, Mr Jospeh Hallal of Phoenix appointing Mr Lilli of Vic Lilli & Partners as the new certifier.
On 4 June 2019 a CC was issued by Vic Lilli & Partners for works in relation to the approved mixed use building, as modified to contain two additional levels of basement and 36 residential apartments.
A CC was issued for the change of use and building works associated with DA 2019.017 by Vic Lilli & Partners on 4 October 2019.
Finally, on 23 December 2019 an IOC was purportedly issued for the building by Mr Lilli. The IOC excluded level 2 and level 10 of the building.
[7]
The Operation of the Premises
CVA Apartments Pty Ltd ("CVA") is the registered owner of the premises.
Marsden Hotel Burwood Pty Ltd ("Marsden Hotel") is the lessee of part of level 1, all of the ground floor, levels 2-9, level 11, and all of the basements of the building.
Marsden Hotel also operates the café and restaurant at the premises.
The restaurant and café at the premises commenced trading on 24 December 2019. On the same day the hotel received its first guests.
According to Mr Sonter, the current occupancy rate for the hotel based on existing occupants and current bookings is as follows:
DATE NUMBER OF ROOMS CURRENTLY OCCUPIED AND NUMBER OF ROOMS WHICH WILL BE OCCUPIED ON THAT DAY
7/02 8 and 4
8/02 8 and 2
9/02 10 and 4
10/02 11 and 4
11/02 8 and 1
12/02 7 and 2
13/02 3 and 0
14/02 8 and 5
15/02 29 and 23
16/02 16 and 5
17/02 11 and 5
[8]
The Council relied upon the affidavit of Mr Tai Trinh sworn 13 February 2020, together with accompanying exhibits. Mr Trinh is the Compliance Coordinator for the Council. In his affidavit Mr Trinh deposed to the following unchallenged relevant facts, namely, that:
1. on 12 January 2020 the Council was contacted by Senior Constable Evva Christofi of Burwood Police. The contact was by email which was sent directly to the Council. The police had entered the premises on the basis that liquor was being sold without a licence. The email detailed fire safety concerns including that there were no fire exit signs, no annual fire safety certificate being displayed, and that there were tables blocking fire exits. The email stated as follows:
Good morning Steve,
I know it's your first day back but Sergeant KELLY and I inspected a premises on Friday night and found some major fire safety issues which we asked them to reiy [sic] immediately. It is a brand new premises with a commercial kitchen for both restaurant and café however they did not have fire exit signs. I could not find the Annual Fire Safety Certificate displayed anywhere so not sure if they have supplied anything to Council. We attended again on Sunday night and they were still serving alcohol at 10:30 pm, and they had not removed the table which was blocking the "fire exit."
I am hoping that either yourself or someone else who Martin nominates attends the location with us sometime. We start at 11am on Monday and wanted to visit in the early hours of Monday afternoon.
Marsden Hotel- 60 Burwood Rd, Burwood
1. on 13 January 2020 Council officers inspected the premises in the company of police. There were building works on levels 2 and 10, and those floors resembled a building site;
2. he checked the Council records on 13 January 2020 and could not locate an Occupation Certificate ("OC") for the premises;
3. on 14 January 2020 the Council issued the Orders to CVA and Marsden Hotel ordering that they immediately cease the use of the premises until a valid OC was issued;
4. on 15 January 2020 the Council received an email, attached to which was a letter and a document purporting to be an IOC allowing occupation of the premises, excluding levels 2 and 10. The IOC appeared to be signed by Mr Lilli;
5. the IOC was dated 23 December 2019, which was after Mr Lilli had lost his accreditation to issue an OC;
6. prior to receipt of the copy of the IOC, the Council had neither received notification of it being issued nor had Council received a copy of any of the compliance certificates or other documents that it was statutorily obliged to receive;
7. on 15 January 2020 he sent an email to Mr Lilli asking if an OC had been issued, and if so, to provide him with a copy;
8. on 22 January 2020 Mr Lilli responded stating that he had never issued an OC, including an IOC, for the premises;
9. the hotel, café and restaurant are each operating. Members of the public are occupying the hotel. Guests are sleeping on various floors of the hotel overnight, members of the public are using the restaurant and café, and staff are present in the building, including overnight. He noted that the hotel was staffed 24 hours a day;
10. because a hotel is a place of short term accommodation, it was his opinion that if there is not adequate fire safety signage or direction in place there can be an adverse or life threatening impact on the occupants of the premises. This is particularly so in the case of those occupants who do not speak English and who would be reliant on standard egress signs (including with pictures) to know where to go if there is a fire;
11. on 6 February 2020 Council officers in his team sought to enter the premises for the purposes of verifying whether or not the Orders had been complied with. Ms Glenda Lam, who is part of the management of the hotel and its controlling property group, approached the Council officers as they attempted to enter the premises and said "I am not going to let you on to the premises". The officers left the premises without making an inspection;
12. on 7 February 2020 Council officers again sought to enter the premises and were again denied access by Ms Lam. They left the premises without making an inspection; and
13. on 8 and 9 February 2020, Council officers further sought to enter and inspect the premises. On each occasion the hotel staff refused to allow the officers into the premises. The hotel staff advised that this was by order of Mr Patterson, the hotel's General Manager. The officers left the premises without making an inspection.
After issuing the Orders, a Fire Engineering Certificate and Report, dated 10 February 2020, was provided to the Council in respect of the premises by Dix Gardener Group Pty Ltd ("Dix"), the replacement PCA for the premises in relation to an application for a new OC (see the second affidavit of Mr Sonter, sworn 14 February 2020). The covering letter accompanying the Certificate and Report, which was dated 13 February 2020, stated the following:
We are in receipt of your application for an Interim Occupation Certificate in respect of the above address.
FRNSW have undertaken a satisfactory Clause 152 Inspection where a number of minor items were identified and are currently being attended to.
We have undertaken a satisfactory inspection and are in receipt of 95% of requested documents and certification required from the Applicant.
The Replacement PCA is in a position to issue the Interim Occupation Certificate pending receipt of the following items:
- Minor matters arising from our & FRNSW inspections;
- Copy of the Stormwater Management Schedule;
- Handrail to be installed in the fitness room.
We trust this explains our position.
In the first Sonter affidavit, Mr Sonter gave the following evidence in relation to the current use of the hotel and the financial detriment that the applicants would suffer if a stay was not granted:
47. I am also informed by Mr Patterson that there is a total of 42 staff employed on the Site. The employees are broken down as follows:
(a) 30 full time salary
(b) Onyx restaurant - 1 front of house full time and 3-4 casuals and 6 chef and kitchen on salary
(c) Café - 2 front of house full time and 2 casuals and 4 chef on salary
(d) Skye - 2 front of house full time and 2-3 casuals
….
49. I am informed by Mr Patterson that three of the above staff have been sponsored by the business operations of the hotel and if such employment no longer exists they will not have any working rights or visa which permits them to stay within the country.
The timing issue
50. The hotel currently has a significant number of bookings over the coming weeks and months.
51. The logistical process of cancelling future bookings and removing existing occupants, including finding alternate accommodation is a significant task and one which would require some time to finalise.
Commercial implications of the stop use order
52. I am instructed by the applicant that the practical impact of the stop use order will create serious and immediate financial hardship and impact on the commercial brand reputation within the industry.
53. I am instructed by Mr Patterson and the applicant that the financial impact of the cessation of the use of the premises would include:
(a) Cancellation fees payable to all existing and future hotel occupants;
(b) Costs associated with relocating guests to other places of accommodation;
(c) Loss in revenue in the amount of approximately $40,000 per week;
(d) Loss of rent under the lease for the building;
(e) Loss of revenue for restaurant and café; and
(f) Payment of full time staff salaries in the absence of trade.
Emergency circumstances
54. The stop use order is described as being issued in an emergency.
55. I am instructed by Haoui, a project manager employed by CVA Apartments that at the time of the Council inspection prior to the issue of the order, and every other inspection undertaken by the respondent there was not any building work being carried out at the premises.
56. I am instructed, and verily believe, that any construction worker identified on site was engaging in inspections of the building after requests were made by CVA Apartments in relation to a number of minor finishes which required review and possible rectification.
57. I am instructed by Mr Haoui that no major building work, apart from cleaning and minor repairs to finishes is currently being undertaken on the site.
58. The following certification has been issued for the building …
(a) Garbage chute certificate
(b) Kone Lift (1 and 2) installation certificates
(c) Lightweight and smoke proof walls installation certificate
(d) Access panels for fire resistant shafts installation certificate
(e) Automatic dry fore and warning system installation certificate
(f) Automatic fail safe warning certificate
(g) Door to fir shafts installation certificate
(h) Emergency lighting and exist signage certificates
(i) Fire dampers and mechanical ventilation installation certificates
(j) Fire door and smoke seals installation certificate
(k) Fire hydrant and hose reel certificate
(l) Fire sprinkler installation certificate
(m) Portable fire extinguisher installation certificate
(n) Pool registration
(o) Pool barrier compliance checklist
(p) Pool compliance certificate
…
To refuse the stay would cause the Applicant to incur a significant financial burden
62. The timeframe for compliance with the Order (immediately), did not provide the Applicant with sufficient time to rearrange or seek to alter the operations of the building or to relocate existing occupants.
63. I am instructed that in order to comply with the terms of the order use permitted by the stop use order, the Applicant would incur significant financial costs.
The stay is necessary to prevent injustice in relation to proceedings in the Court
64. The applicant has obtained multiple development consents and approvals for modifications to those consents.
[9]
The Court Has the Power to Grant the Stay
Initially the Council sought to argue that the Court had no power to grant a stay of the Orders in Class 1 of the Court's jurisdiction. However, during argument it resiled from this contention. In my view, it was correct to do so in light of the powers of the Court contained in ss 22 and 23 of the Land and Environment Court Act 1979 ("the LEC Act").
Those provisions state the following:
22 Determination of matter completely and finally
The Court shall, in every matter before the Court, grant either absolutely or on such terms and conditions as the Court thinks just, all remedies to which any of the parties appears to be entitled in respect of a legal or equitable claim properly brought forward by that party in the matter, so that, as far as possible, all matters in controversy between the parties may be completely and finally determined and all multiplicity of proceedings concerning any of those matters may be avoided.
23 Making of orders
The Court has power, in relation to matters in which it has jurisdiction, to make orders of such kinds, including interlocutory orders, as the Court thinks appropriate.
Section 22 was relied upon as the source of the Court's power to grant a stay in Crosseyed Management Pty Ltd v Parramatta City Council [2013] NSWLEC 53 (at [3] per Craig J).
In Eniflat Pty Limited v Tweed Shire Council [2019] NSWLEC 150 Pain J (at [2]) accepted that the Court had the power to grant a stay in Class 1 proceedings. Her Honour so held after having read the transcript of the interlocutory hearing granting a stay by Preston J (no reasons given) on 21 December 2019, where his Honour relied on s 23 of the LEC Act (T10:48-11:06).
Without having to decide whether either or both provision confer power on the Court to grant a stay in Class 1 appeals, I accept that the Court has the requisite power to do so. Counsel for the Council accepted the binding nature of the authorities referred to above insofar as he did not seek to argue that either was plainly wrong.
[10]
Applicable Legal Principles in Granting a Stay
The principles in relation to whether a stay of orders the subject of an appeal should be granted were summarised in the seminal case of Alexander v Cambridge Credit Corporation Ltd (1985) 2 NSWLR 685 (at 693-695). They were expanded upon by Beazley JA (as her Honour was then) in Chen v Lym International [2009] NSWCA 121 per Beazley JA at [12]-[15], by Handley, Sheller and Ipp JJA in Kalifair Pty Ltd v Digi-Tech (Australia) Ltd [2002] NSWCA 383; (2002) 55 NSWLR 737 (at [17]-[20]), and in this Court by Sheahan J in Young v King (No 10) [2016] NSWLEC 70 at ([24]-[25]).
The principles were summarised by Gleeson JA in Lawrence v Gunner [2015] NSWCA 322 (at [10]-[15]):
10 The principles to be applied when exercising the Court's power to grant a stay pending an appeal are well known: see Alexander v Cambridge Credit Corporation Ltd (1985) 2 NSWLR 685 at 694-695, and Kalifair Pty Ltd v Digi-Tech (Australia) Ltd [2002] NSWCA 383; 55 NSWLR 737 (Kalifair) at [17]-[20].
11 A successful party is prima facie entitled to the fruits of his or her judgment, but a stay may be granted where an applicant demonstrates an appropriate case to warrant the exercise of discretion in its favour. The mere filing of the appeal is insufficient, of itself, to demonstrate such a case. Usually it is demonstrated by showing that there are arguable grounds of appeal and that there is a risk that if money is paid it will be unable to be recovered if the appeal succeeds, or by demonstrating that unless a stay is granted the appeal will be rendered nugatory: TCN Channel 9 Pty Ltd v Antoniadis [No 2] [1999] NSWCA 104; 48 NSWLR 381 at [15]. The Court will weigh considerations such as the balance of convenience and the competing rights of the parties.
12 It is for the applicant to demonstrate a proper basis for a stay that will be fair as between the respective interests of the parties: see Alexander v Cambridge Credit Corporation Ltd at 694; Adeels Palace Pty Ltd v Moubarak [2009] NSWCA 130 at [5].
13 It is appropriate to consider first whether the appeal raises a serious question to be tried, in the sense of arguable grounds, and if so, where the balance of convenience lies: Kalifair at [18]; Vaughan v Dawson [2008] NSWCA 169 at [17] (Campbell JA).
14 As already mentioned, the notice of appeal is not particularly informative. The requirements of the rules concerning a notice of appeal are set out in UCPR r 51.18. The notice is required to state, briefly but specifically, the grounds relied upon in support of the appeal. In addition, subrule (2) requires the appellant to also specify any material facts that the appellant contends that the court below should, or should not, have found. Here the notice of appeal does not comply with these requirements.
15 As Campbell JA observed in Vaughan v Dawson [2008] NSWCA 169 at [22], having a notice of appeal that does not comply with the rules is an unpromising start for proving there is a serious question about whether the appeal will succeed. Nonetheless, Campbell JA accepted that it may not be fatal if there is reason to believe that the notice of appeal could be amended to state properly arguable grounds. This requires one to consider on a broader basis whether the appellants have shown a prospect of successfully appealing from the judgment. I adopt that approach here.
They were condensed further and applied by Gleeson JA (after referring to and endorsing Alexander and Kalifair) in Collier v Country Women's Association of New South Wales [2017] NSWCA 303 (at [32]):
32 It is not necessary to refer to those principles in any detail other than to note that in such cases, the successful party is prima facie entitled to the benefit of a judgment, but a stay may be granted where an applicant demonstrates an appropriate case to warrant the exercise of discretion in its favour. The mere filing of the appeal is insufficient, of itself, to demonstrate such a case. Usually it is demonstrated by showing that there are arguable grounds of appeal, and that there is a significant risk that if money is paid it will be unable to be recovered if the appeal succeeds; or by demonstrating that unless a stay is granted the appeal will be rendered nugatory: TCN Channel 9 Pty Limited v Antoniadis (No 2) (1999) 48 NSWLR 381 at 385 [15]. It is for the applicant to demonstrate a proper basis for a stay that will be fair as between the respective interests of the parties: see Alexander v Cambridge Credit Corporation Ltd at 694; Adeels Palace Pty Ltd v Moubarak [2009] NSWCA 130 at [2].
In relation to the strength of the appeal, Basten JA opined as follows in Yeshiva Synagogue Inc v Karimbla Properties (No 10) Pty Ltd [2017] NSWCA 331 (at [17]-[18]):
17 So far as the last matter is concerned, the inquiry is usually constrained to a determination whether the appeal is reasonably arguable. With respect to the prospects of success on an appeal, the Court stated in Alexander v Cambridge Credit Corporation Ltd (Receivers appointed):
"… although courts approaching applications for a stay will not generally speculate about the appellant's prospects of success, given that argument concerning the substance of the appeal is typically and necessarily attenuated, this does not prevent them considering the specific terms of a stay that will be appropriate fairly to adjust the interests of the parties, from making some preliminary assessment about whether the appellant has an arguable case."
18 The grammatical structure of this statement is not entirely clear, but the availability of "some preliminary assessment" has generally been regarded as going to the merits of granting a stay or declining to do so, and not merely to the terms on which it may be granted.
Finally, in Snowy Monaro Regional Council v Cmunt (No 3) [2018] NSWLEC 175 the Court stated as follows (at [17]):
17 The principles may be relevantly summarised as follows:
(a) first, it is not necessary for the grant of a stay that special or exceptional circumstances be made out. It is sufficient that the applicants for the stay demonstrate a reason or an appropriate case to warrant the exercise of discretion in their favour;
(b) second, the onus is upon the applicant to demonstrate a proper basis for a stay that will be fair to all parties;
(c) third, the mere filing of an appeal will not, of itself, provide a reason or demonstrate an appropriate case, nor will it discharge the onus which the applicant bears;
(d) fourth, the Court has a discretion whether or not to grant the stay and, if so, as to the terms that would be fair. In the exercise of its discretion, the Court will weigh considerations such as the balance of convenience and the competing rights of the parties before it;
(e) fifth, where there is a risk that the appeal will prove abortive if the appellant succeeds and a stay is not granted, courts will normally exercise their discretion in favour of granting a stay; and
(f) sixth, although courts approaching applications for a stay will not generally speculate about the appellant's prospects of success, given that argument concerning the substance of the appeal is typically and necessarily attenuated, this does not prevent them from making a preliminary assessment about whether the appellant has an arguable case.
[11]
The Appeals Indirectly Raise a Serious Question to be Tried
The applicants' Class 1 appeals do no more than seek revocation or variation of the Orders. In the absence of any Statement of Facts and Contentions filed by either party in the Class 1 appeals it is difficult to assess whether or not the appeals raise a serious question to be tried.
Rather, the serious question to be tried arises in the related Class 4 proceedings in light of the startling uncontested evidence by Mr Lilli that the IOC was not issued by him.
If this evidence is ultimately accepted then, as the Council submitted, the likely result is a fraud on the PCA and the decision made by the PCA is fatally infected with jurisdictional error because there has been a constructive failure to exercise jurisdiction. Put another way, there has been no decision at all to issue an IOC (SZFDE v Minister for Immigration and Citizenship [2007] HCA 35; (2007) 232 CLR 189 at [52]).
As stated above, the Class 4 proceedings are to expedited and its determination will wholly dispose of the three Class 1 appeals.
On this basis I find that (albeit indirectly through the vehicle of the Class 4 matter) there is a serious question to be tried.
[12]
The Balance of Convenience Favours the Applicants
The Council submitted that the balance of convenience weighed against the granting of a stay because of:
1. the seriousness of the matters referred to in the Orders, some of which remained outstanding as at the hearing of the application for a stay;
2. the matters deposed to by Mr Trinh in relation to the events giving rise to the issuing of the Orders, including the continuing building works and the fire safety concerns;
3. the previous (on four separate occasions) and continued refusal of the applicants to permit the Council to inspect the premises;
4. the evidence of Mr Lilli to the effect that the IOC had been fraudulently issued, with the consequence that it is void and that therefore there is presently no OC for the premises; and
5. the premises are intended to be occupied by the public and in fact are currently being used as a hotel, a restaurant, and a café, notwithstanding that there has been no certification by the appointed - or any - PCA that the building is safe for occupation.
In light of the undoubted financial detriment to be suffered by the applicants if the stay were not granted, the Council, while conceding that such detriment would occur, submitted that this was not a sufficient "pre-condition" for the grant of a stay (citing Kalifair Pty Ltd v Digi-Tech (Australia) Ltd [2002] NSWCA 383; (2002) 55 NSWLR 737 at [17]-[20]).
While the Council is correct to contend that financial disadvantage is not a prerequisite for the granting of a stay, it is nevertheless, as the authorities demonstrate, a factor to be considered by the Court in determining where the balance of convenience lies. There is nothing in Kalifair to the contrary.
There is no doubt that certification of development by the issuing of a OC is an essential part of the planning regime of this State. As the Council remarked, the OC, together with its supporting documentation, is evidence that a PCA has inspected the premises having regard to the health and safety of persons likely to use the premises. In the present case, by reason of the apparent fraud committed on the Council, this essential inspection and certification has not occurred.
Notwithstanding the seriousness of the matter referred to above, there are several factors that, although finely balanced, weigh in favour of the exercise of the Court's discretion to grant a stay:
1. first, development consent has been granted and is in force for the premises and its current use;
2. second, a CC has been issued for the building works and the building has been constructed in accordance with that certificate;
3. third, fire safety certification has since been obtained and the Report accompanying the Fire Safety Certificate indicates that only minors matters need be attended to;
4. fourth, the applicants have taken measures to remedy the potential unlawfulness of the grant of the IOC by appointing a replacement PCA to consider an application for an OC. The information required by the replacement PCA in order to grant a new OC for the premises is minimal and the grant of the new OC is imminent;
5. fifth, the financial detriment and prejudice to the applicants and the persons employed by them if a stay of the Orders is not granted would be significant. Indeed it is arguable given the adverse financial impact and likely reputational damage (especially on social media) to the applicants that if a stay is not granted the Class 1 appeals may be rendered nugatory;
6. sixth, while there was delay by the applicants in bringing this application, there was also delay by the Council in issuing the Orders given that they were aware of potential breaches of the EPAA and, in particular, that some of those breaches concerned matters relating to fire safety, from at least 12 December 2019. The Orders were not, however, issued until 24 January 2020, almost six weeks later;
7. seventh, the Council could have, but elected not to, seek urgent interlocutory relief in the Class 4 proceedings. The sanction for breach of court ordered interim injunctive relief is far more serious (and thus tends to elicit greater compliance) than that for a breach of the Orders (as evidenced by the fact that there has been an ongoing breach of those Orders since they were issued);
8. eighth, if a stay is granted, the applicants are content for it to be subject to the following conditions proposed by them, namely, that:
1. the applicants are to permit the Council immediate access to the premises to assess the safety of the building;
2. the applicants are to actively pursue the grant of a new OC;
3. there is to be no occupation or use of levels 2 and 10 of the premises; and
4. there is to be no further building works or construction on or at the premises.
For all these reasons, a stay of the Orders is warranted subject to the conditions proposed by the applicants.
[13]
Orders
For the reasons given above, the orders of the Court were as follows:
1. the operation of three Development Control Orders No. 1 - Stop Use - issued by Burwood Council on 24 January 2020 (refs 20/3072, 20/3243 and 20/3071) ("the Orders") in respect of the premises at 60 Burwood Rd, Burwood ("the Premises") are stayed until final determination of the expedited Class 4 proceedings 2020/31966 (which are listed for final hearing on 2 and 3 March 2020), subject to the following conditions:
1. the applicants are to permit Burwood Council immediate access to the premises to assess the safety of the building;
2. the applicants are to actively pursue the grant of a new building occupation certificate;
3. there is to be no occupation or use of levels 2 and 10 of the premises;
4. there is to be no further building works or construction on or at the premises; and
1. the three Class 1 matters are adjourned until final determination of the Class 4 proceedings (2020/31966) referred to above;
2. liberty to restore; and
3. the exhibits are to be returned.
[14]
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Decision last updated: 27 July 2020