Direct Factory Outlets Homebush Pty Limited v Strathfield Municipal Council

Land and Environment Court (NSW)|2006-04-13|Before: Pain J, Mr J

CITATION : Direct Factory Outlets Homebush Pty Limited v Strathfield Municipal Council [2006] NSWLEC 185

APPLICANT Direct Factory Outlets Homebush Pty Limited RESPONDENT PARTIES : Strathfield Municipal Council

APPLICANTS ON MOTION Westfield Management Pty Ltd Walker Corporation Pty Ltd

LEGISLATION CITED: Land and Environment Court Act 1979 s 39A Strathfield Planning Scheme Ordinance cl 22, cl 61GB(3)

Kavia Holdings v Sydney City Council (2003) 127 LGERA 293 ; CASES CITED: Mahogany Ridge Developments Pty Ltd v Port Stephens Council (2004) 135 LGERA 60 ; Pro-Vision v Ku-ring-gai Municipal Council (2003) 131 LGERA 108; Westfield Management Ltd v Direct Factory Outlets Homebush Pty Ltd [2005] NSWCA 403

APPLICANT Mr J Robson SC SOLICITORS Gilbert & Tobin

RESPONDENT LEGAL REPRESENTATIVES: Mr T O'Connor (solicitor) SOLICITORS Houston Dearn O'Connor

APPLICANTS ON MOTION C Birch SC with Mr J Sheller SOLICITORS Speed and Stracey

JUDGMENT: THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES

10009 of 2006 Direct Factory Outlets Homebush Pty Limited v Strathfield Municipal Council

JUDGMENT ON MOTION FOR JOINDER 1 Her Honour: This is an application by Westfield Management Ltd ("Westfield") and Walker Corporation Pty Ltd ("Walker Corporation") under s 39A of the Land and Environment Court Act 1979 ("the Court Act") for joinder as parties in these Class 1 proceedings. The Council has refused development consent to Direct Factory Outlets Homebush Pty Limited ("DFO") for the physical expansion to levels 1 and 2 of a factory outlets centre which now operates on level 3 of its Homebush premises and DFO appealed against the decision in these proceedings. 2 Condition 11 of the existing development consent for level 3 contains a definition of "factory outlets centre". The lawfulness of the operation of four premises out of approximately seventy outlets on level 3 in light of that definition is currently being challenged in Class 4 proceedings by one of the Applicants for joinder and others. There is no definition of "retail outlets centre" in the Strathfield Planning Scheme Ordinance ("SPSO").

3 Walker Corporation owns the nearest large shopping centre at North Rhodes, located approximately 2km from the Homebush premises. Westfield has shopping centres at Parramatta and Burwood which it argued will be affected if the DFO consent is granted.

4 (i) The statement of issues filed by the Council states the proposal is prohibited as: (a) such shops are not ordinarily incidental or subsiding to industry, and (b) such shops are not primarily intended to serve persons occupied or employed in a land use otherwise permitted in the zone, and (c) such shops by virtue of their nature or the products sold are not appropriately located in the zone (cl 22 of SPSO).

(ii) Council cannot grant consent as it is not satisfied, pursuant to cl 61GB(3) of SPSO that: (a) the development will not detrimentally affect the viability of any business centre in the locality (b) the development is not available in another business centre in the locality, and (c) the development is of a type appropriate to an industrial zone or to the general character of existing development within the industrial zone.

5 Section 39A of the Court Act states: On an appeal under section 97 or 98 of the Environmental Planning and Assessment Act 1979, the Court may, at any time, on the application of a person or of its own motion, order the joinder of a person as a party to the appeal if the Court is of the opinion: (a) that the person is able to raise an issue that should be considered in relation to the appeal but would not be likely to be sufficiently addressed if the person were not joined as a party, or (b) that:

(i) it is in the interests of justice, or (ii) it is in the public interest, that the person be joined as a party to the appeal.

Grounds raised in support of application for joinder 6 The Applicants for joinder argued that there is an additional issue not raised by the Council's statement of issues concerning the characterisation of a "factory outlets centre" under the SPSO which they are best able to pursue rather than Strathfield Council. They consider the application of condition 11 of the existing consent for level 3 will be raised either directly or by implication in these Class 1 proceedings. As the Class 4 proceedings on foot raise concerns about the effective operation of that condition they should be allowed in as parties.

7 It was also argued that there is necessary additional evidence about the economic impact of the development they wish to adduce from Mr Rumbold in relation to issue 2(a) in the statement of issues concerning the impact of the development on other businesses, in particular those of the Applicants for joinder. Further evidence is also said to be necessary from Mr Ingham, planner, in relation to whether the proposed development consent permitting use of levels 1 and 2 as a factory outlets centre as defined in the current condition 11 for level 3 is satisfactory, the planning impacts the shops proposed will have, and whether there is other suitable land available for the proposed development. These matters are raised by issues 2 (b) and (c) of the statement of issues.

DFO's submissions 8 DFO opposes the application because the Applicants for joinder have already had the opportunity as objectors to the development to put their views. Condition 11 is not relevant to these Class 1 proceedings. The Applicants for joinder have delayed in seeking to be joined as parties and there is no explanation for that delay. DFO also opposed the joinder, relying on Pro-Vision v Ku-ring-gai Municipal Council (2003) 131 LGERA 108 at [4], where it was held a court could have regard to delay and the strength of the issues sought to be raised when deciding an application for joinder. In this case, the Applicants for joinder are not raising anything that is not already, or cannot easily be covered by the Council. The Council is an experienced public body with the relevant expertise to know which issues are necessary to be raised in these proceedings without the joinder of the Applicants. 9 DFO also argued that the Court must have regard to considerations of justice and public interest when deciding a joinder application. Here, relevant considerations include the public participation process already provided for under the EP&A Act in which the Applicants for joinder participated; the fact that the parties seeking application for joinder are the commercial competitors of DFO; and the need for the expeditious disposition of proceedings. Economic competition between traders is not a matter for consideration of a development application under s79C of the EP&A Act. The Council has not yet provided draft conditions of consent and hence the joinder of the Applicants cannot assist the Court any further with this process. Finding 10 Kavia Holdings v Sydney City Council (2003) 127 LGERA 293 and Mahogany Ridge Developments Pty Ltd v Port Stephens Council (2004) 135 LGERA 60 recognise that s 39A provides the Court with broad discretion to allow the joinder of parties given its terms. 11 The Council's solicitor was instructed to neither oppose nor support the application. The Court asked him to attend in order to clarify the issues the Council intends to argue at the hearing. The first issue raised in the statement of issues at par 4 is that "such shops" are prohibited because of the provisions of cl 22 of the SPSO. The second issue raised is that the Court cannot be satisfied of matters in cl 61GB(3) of the SPSO. 12 In terms of whether additional issues should be raised, it is clear that the issue of how the development should be characterised for the purposes of the SPSO needs clarification in terms of the statement of issues filed, or at least as between the parties. The Council will be seeking to argue that the development application is for shops which, either individually or collectively, are prohibited development under cl 22 of the SPSO. DFO will be arguing that the whole of levels 1 and 2 of the Homebush premises should be considered as a factory outlets centre, in which a number of shops operate, which satisfies cl 22 of the SPSO. It is not completely clear to me how these arguments relate to the particular definition of "shop" and the provisions of cl 22 in the SPSO, particularly in terms of how DFO intends to characterise its proposed development. If DFO continues to state only that it wishes to replicate what is occurring on level 3, that is likely to raise a number of issues because that activity is regulated by condition 11 of the existing development consent conditions. That condition is not open to easy interpretation or application as I am aware from hearing the initial stages of the Class 4 proceedings and as noted by Hodgson JA in the Court of Appeal in Westfield Management Ltd v Direct Factory Outlets Homebush Pty Ltd [2005] NSWCA 403. I note that the parties are to further discuss and reduce to writing the issues in this regard and consider amendment of the statement of issues.

13 The issue of characterisation of the proposed development in light of the SPSO provisions does need clarification and, I suspect, argument. The DFO submissions stated that the definition of "factory outlets centre" will inevitably form part of the matters considered in these proceedings. Condition 11 may or may not arise directly in that context. Condition 11 may arise if the need for control of the proposed development through development consent conditions arises. The Applicants for joinder have a particular view, to be argued in the Class 4 proceedings, that the condition is unworkable as an effective regulatory mechanism for the activity undertaken on level 3 and would obviously argue against its application to the proposed development on levels 1 and 2. I consider that the Applicants for joinder do have particular concerns and experience on that issue which should be argued by them before the Court as parties to this matter in the event that condition 11 arises, and in relation to the operation of "factory outlets centres" generally.

14 In relation to the evidence to be relied on, the Council has instructed its expert on economic impact not to undertake an economic impact assessment of the proposed development but rather to consider the question of whether the evidence filed in support of the application satisfies cl 61GB(3) as to whether the development will detrimentally affect the viability of any business centre in the locality. The Applicants for joinder seek to adduce evidence of actual economic detriment to their respective businesses if this application is approved. This evidence has a different focus to that undertaken by the Council's economic analysis. It is clearly evidence material to the Court's consideration of the matter.

15 Section 39A(a) requires the Court to consider whether there are matters not sufficiently addressed by another party. I consider there are matters particularly within the knowledge of the Applicants for joinder and their experts which are relevant to the application which the Council may not otherwise be in a position to bring forward. This applies particularly in the area of economic impact in terms of additional evidence the Applicants for joinder wish to bring forward. The Applicants have extensive experience in the operation of shopping centres and their management and particular concerns about how the proposed activity is characterised, defined and regulated under conditions of development consent if these become relevant. I consider it is appropriate that the Applicants for joinder be joined as parties under s 39A(a). 16 The Applicant also seeks to bring forward planning evidence about matters under cl 61GB(3). The extent to which this evidence is needed should be reviewed in light of the most recent planning evidence from the Council which I understand was only served on DFO yesterday.

17 DFO has argued that there has been delay in seeking joinder given that these proceedings were commenced on 6 January 2006, a statement of issues was filed on 14 February 2006 and the proceedings have been set down for hearing on 8-10 May 2006. This application for joinder was filed on 3 April 2000. It is clear however from the correspondence attached to an affidavit of Mr Speed, solicitor, sworn on 12 April 2006 that the Applicants for joinder have been endeavouring to obtain relevant reports from DFO's solicitors and clarification of the Council's case from 22 March 2006 without much success. I do not consider that there is disentitling delay on the Applicants for joinder's part. 18 Section 39A(b) provides that the Court may in the interests of justice and/or the public interest join a party. It is necessary that when I consider the interests of justice I also consider the need for the efficient and expeditious discharge of matters before the Court.

19 The Applicants for joinder have submitted that they intend to meet the case preparation requirements for the hearing in May and will not seek to have the dates vacated if joined. I consider that provided there is adequate case management the matter will be able to proceed in May. I also note that both Applicants for joinder will be represented by the same legal team. I do not consider there are issues related to the overall interests of justice in the efficient disposal of cases which suggest the application for joinder should not be granted.

20 I consider the Applicants on the motion should be joined as parties in these proceedings.

Orders 21 The Court makes the following orders: 1. Westfield Management Pty Ltd and Walker Corporation Pty Ltd are to be joined as parties to the proceedings. 2. Costs are reserved.

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.

(2003) 127 LGERA 293

(2003) 131 LGERA 108

At a glance

Court

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Before

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Judgment (28 paragraphs)

Parties

Cases Cited (4)

Cited By (1)