Edwards Pension Fund Pty Ltd v Wingecarribee Shire Council

Land and Environment Court (NSW)|2023-11-30

Judgment

COMMISSIONER: At a site that is known as 2500 Canyonleigh Road, Canyonleigh, there are two existing licensed water bores. Edwards Pension Fund Pty Ltd and Paul D Edwards Pty Ltd (the Edwards) seek development consent for water extracted from the bores to be piped, filtered, stored and transported from the site. By their agent, the Edwards lodged a development application with Wingecarribee Shire Council (the Council) on 1 November 2021 seeking the use of the property for "water extraction, storage and distribution off site" (Ex A p 3). The development application was refused on 11 October 2022. These proceedings are an appeal against that decision, pursuant to s 8.7 of the Environmental Planning and Assessment Act 1979 (EPA Act).
The proposed development is described in the Statement of Environmental Effects (SEE) in the following way (Ex A, p 17-18): "The development will operate as follows: • Water will be extracted from the two existing approved licensed bores to the existing storage tank (capacity of approximately 275,000 litres) that is approximately 20 metres south west of the shed • Water is then transferred to the existing metal farm shed that will accommodate 4 x 50,000 litre stainless steel water storage tanks, filtration system and pumping equipment • Trucks will access the site from the existing driveway crossing to transfer water from the internal storage tanks into the water tankers, for despatch to remote bottling facilities. These trucks will be general access "short B - Double" combinations up to 19m in length and 57 tonne mass."
The development is proposed to operate on weekdays, excluding public holidays, with up to 10 trucks servicing the site each day.
The Edwards characterise the proposed development as being for the purposes of a water storage facility, which is permissible in the C3 Environmental Management zone in which the site is located, pursuant to the Wingecarribee Local Environmental Plan 2010 (WLEP).
However, the Council remains opposed to the proposed development. It says that the proposed development is prohibited as it cannot be characterised as being for the purpose of a water storage facility, and that it has unacceptable traffic safety impacts.
For the reasons that are set out below, I have determined that the proper characterisation of the purpose of the proposed development is industry, which is a use that is prohibited in the zone. There is therefore no power to grant development consent.

The site and the locality

The site is known as 2500 Canyonleigh Road, Canyonleigh, and comprises two allotments legally described as Lot 152 DP 751284 and Lot 1 DP 867173. It is a total of 146.3ha and has a frontage of 260m to Canyonleigh Road. There is a gravel vehicular driveway that accesses Canyonleigh Road through cultivated olive trees on the north west corner of the site, and the driveway then provides access to a large shed around which the driveway loops. An existing storage tank is located immediately adjacent to the large shed.
Canyonleigh Road is accessed directly from the Hume Highway, which is 7km to the east. Surrounding properties are mainly used for agriculture, with some residential accommodation, all of which are accessed directly from Canyonleigh Road. The nearest local centre is Exeter Village, which is 13km to the east, on the other side of the Hume Highway. To the west, Canyonleigh intersects with Tugalong Road before becoming an unsealed road leading to private properties, and Tugalong Road runs north providing access to a large number of other rural properties either directly or via local roads.

The planning framework

The zoning table for the C3 Environmental Management zone is as follows: 2 Permitted without consent Environmental protection works; Extensive agriculture; Home-based child care; Home occupations 3 Permitted with consent Agricultural produce industries; Agritourism; Airstrips; Bed and breakfast accommodation; Cellar door premises; Community facilities; Dairies (pasture-based); Dual occupancies (attached); Dwelling houses; Eco-tourist facilities; Environmental facilities; Farm buildings; Farm stay accommodation; Flood mitigation works; Health consulting rooms; Helipads; Home businesses; Horticulture; Information and education facilities; Oyster aquaculture; Places of public worship; Pond-based aquaculture; Recreation areas; Recreation facilities (outdoor); Roads; Roadside stalls; Secondary dwellings; Signage; Tank-based aquaculture; Viticulture; Water storage facilities 4 Prohibited Industries; Local distribution premises; Multi dwelling housing; Residential flat buildings; Retail premises; Seniors housing; Service stations; Warehouse or distribution centres; Any other development not specified in item 2 or 3
"Water storage facilities" is a nominated permissible use in the zone, "industries" are a nominated prohibited use, and any use not nominated in the zoning table is an innominate prohibited use.
In addition, the State Environmental Planning Policy (Transport and Infrastructure) 2021 (SEPP TI) makes development for the purpose of water reticulation systems permissible with consent on any land, in s 2.161, and contains the following definition: water reticulation system has the same meaning as in the Standard Instrument but also includes water supply reservoirs.
The meaning contained in the Standard Instrument, which is replicated in the WLEP, is set out further below.
The objectives of the C3 zone are as follows: • To protect, manage and restore areas with special ecological, scientific, cultural or aesthetic values. • To provide for a limited range of development that does not have an adverse effect on those values. • To encourage the retention of the remaining evidence of significant historic and social values expressed in existing landscape and land use patterns. • To minimise the proliferation of buildings and other structures in these sensitive landscape areas. • To provide for a restricted range of development and land use activities that provide for rural settlement, sustainable agriculture, other types of economic and employment development, recreation and community amenity in identified drinking water catchment areas. • To protect significant agricultural resources (soil, water and vegetation) in recognition of their value to Wingecarribee's longer term economic sustainability.
The Wingecarribee Shire Rural Lands Development Control Plan 2021 (WSRLDCP) applies to the site, but contains no controls concerning driveway access, road access and sight lines for a development of this type. It contains only the following controls concerning water storage facilities: "A5.8.3 Controls To meet the above objectives Council shall require development to comply with the following controls. (a) All Water Storage Facilities shall obtain relevant state and local government licenses and / or approvals. (b) Applications should address all relevant site planning and environmental controls detailed within this DCP. (c) Applications should include a detailed site plan showing the location of the proposed facility in relation to all water courses, gradient and overland run off catchments. (d) Details of expected volume in the facility, potential contaminants, sediment and erosion control and location of any associated equipment shall be provided in the application. (e) All Water Storage Facilities shall be constructed utilising the relevant best practice methodologies. (f) No recycled building products or building waste shall be used in the construction of Water Storage Facilities and associated hard stand areas."

The expert evidence

Expert opinion evidence on the traffic and road safety issues raised by the Council was given by Mr Navin Prasad, a traffic engineer engaged by the applicants, and Mr Matthew McCarthy, a traffic engineer engaged by the Council.
Mr McCarthy's evidence is that the driveway entrance should be widened to allow simultaneous two-way movements within the site. He also opines that the sight distance to the east at the driveway interface with Canyonleigh Road is insufficient to ensure safe movement of vehicles from the site into the Canyonleigh Road, relying on his own calculation of the sight distance required. In support of his position, he relies on a study by Austroads that conducted field tests for gap acceptance by drivers. In oral evidence, Mr McCarthy agreed that the field tests for gap acceptance relate to perceptions of what a safe gap is, rather than relating to actual safe distances to complete a turn.
Further, Mr McCarthy opines that Canyonleigh Road is not of sufficient width to allow two vehicles of the size required by the development to pass simultaneously.
Mr Prasad instead relies upon Australian Standard AS 2890.2:2018, which concerns off-street commercial vehicle facilities, and says that the access driveway has been designed in accordance with that standard and the sightlines similarly comply with the same. Therefore, he concludes that two way passing is not required in the access driveway entrance, and that the sightlines are sufficient.
In addition, Mr Prasad relies on a Heavy Vehicle Access Plan that is proposed for the development, which provides a schedule of the truck movements for the site. Compliance with this plan, which can form a condition of the development consent, would ensure that trucks using the site would not pass another truck on the site, nor another truck travelling to/from the site on Canyonleigh Road.

Is the proposed development permissible?

It is well established that development is for a purpose (see Shire of Perth v O'Keefe (1964) 110 CLR 529), and I must be satisfied that the development proposed in the development application is for the purpose of a use that is permissible with development consent.
A water storage facility, which is permissible on the site, is defined in the WLEP as follows: Water storage facility means a dam, weir or reservoir for the collection and storage of water, and includes associated monitoring or gauging equipment
The parties agree that the storage tanks proposed are a type of "reservoir", however they remain in disagreement as to whether the purpose of the proposed use is for a water storage facility as defined.
As stated by Preston CJ in Chamwell Pty Limited v Strathfield Council (2007) 151 LGERA 400; [2007] NSWLEC 114 (Chamwell), the purpose of the use is "the end to which land is seen to serve" (at [27]).
In determining the purpose of the proposed use, I must consider what end is served by the various works and activities to be carried out. Rather than dividing the proposal into its component parts, which includes the extraction and piping of water, the filtration of the water, the construction of tanks, the storage of the water in tanks, and its transport off the site, I must determine the end served by these physical acts.

The Council's position that the purpose is not for a permissible use

The Council's position is that the activities the subject of the development application are directed to the production of potable, bottled water. It describes the activities the subject of the development application as follows (Respondent Written Submissions, p.6): "● the extraction of the water into the first tank. ● the passing of the extracted water through the filtration and disinfection system to render it potable. ● the construction of new tanks to receive the filtered and disinfected water and quarantine it from the freshly extracted, untreated water; ● the temporary storage of that water in the new tanks until it is transported; ● the filling of tankers from those tanks; and ● the transportation of that water by those tankers to a bottling facility on other land."
The Council points out that all of the water to be extracted from the bores will be exported from the site, so that when you have regard to all of the activities on the site it cannot be for the purpose of a storage facility. The Council submits that these activities are directed to the production of water, which falls within "industries", a prohibited use in the zone. The relevant definitions concerning industry are as follows: industry means any of the following - (a) general industry, (b) heavy industry, (c) light industry, but does not include - (d) rural industry, or (e) extractive industry, or (f) mining. general industry means a building or place (other than a heavy industry or light industry) that is used to carry out an industrial activity. heavy industry means a building or place used to carry out an industrial activity that requires separation from other development because of the nature of the processes involved, or the materials used, stored or produced, and includes - (a) hazardous industry, or (b) offensive industry. It may also involve the use of a hazardous storage establishment or offensive storage establishment. light industry means a building or place used to carry out an industrial activity that does not interfere with the amenity of the neighbourhood by reason of noise, vibration, smell, fumes, smoke, vapour, steam, soot, ash, dust, waste water, waste products, grit or oil, or otherwise, and includes any of the following - (a) high technology industry, (b) home industry, (c) artisan food and drink industry, (d) creative industry. industrial activity means the manufacturing, production, assembling, altering, formulating, repairing, renovating, ornamenting, finishing, cleaning, washing, dismantling, transforming, processing, recycling, adapting or servicing of, or the research and development of, any goods, substances, food, products or articles for commercial purposes, and includes any storage or transportation associated with any such activity.
Having regard to the definitions of rural industry, extractive industry, or mining, which I do not repeat, there is no dispute that the proposed development does not fall within one of those industries.
The Council submits that the definition of "industrial activity" is sufficiently broad to cover the aspects of extraction of water, storage of water, filtration of extracted water, and ultimate transportation of that water. Its position is that the production and transport of treated water is proposed at a significant scale, as it is sufficient to fill up to 10 tankers per day. The Council submits that the truck movements are not incidental, or ancillary to, a water storage use but arise because the purpose of using the extracted water is to produce a product, that is water for bottling. In support of this submission, the Council points out that the traffic assessment is premised on the assumption that the entire 70ML of water extracted will be removed from the site for bottling operations (Ex A, Tab 18, p 212). The Council therefore submits that the most fitting characterisation of the purpose of the development is as either a general industry or a light industry, both of which are prohibited on the site by reason of them being species of the genus of "industries". It submits that the water extraction, water storage, water treatment and truck movements are all components of that use.
In support of its position, the Council relies on a number of decisions of the Court. In particular, in both Liauw v Gosford City Council (2004) 136 LGERA 349; [2004] NSWLEC 72 (Liauw) and Waterland Blue Mountain Natural Water Pty Ltd v Blue Mountains City Council [2006] NSWLEC 537 (Waterland), groundwater was held to be a "primary product" for the purpose of applying the relevant definition of "rural industry" (which is no longer a definition which would encompass this form of development). The Council submits that, although the definition of "rural industry" has changed, these decisions confirm that, for the purpose of applying the definition of "industrial activity" under the WLEP, groundwater is capable of falling within the term "goods, substances, food, products or articles". In addition, in Waterland, the nature of the development was similar to that proposed in the present application, in that it involved extraction and storage of pumped water, and then transport from the site to another facility, and the Court held that the activities met the description of "handling, treating, processing or packing of primary products".
The Council also submits that the truck facilities, and the tanks and water treatment, do not fit within the scope of a use for the purpose of a "water reticulation system", which is permissible on the site pursuant to the SEPP TI. A water reticulation system has the following definition: water reticulation system means a building or place used for the transport of water, including pipes, tunnels, canals, pumping stations, related electricity infrastructure and dosing facilities.
In the SEPP TI, a water reticulation system also includes water supply reservoirs. The Council submits that the purpose of the use is not for a water reticulation system, as the transport of the water from the site is not a "building or place" used for the transport of water, and is not a use that forms part of, or is subsumed into, a water reticulation system.
The other definitions of relevance are: water supply system means any of the following - (a) a water reticulation system, (b) a water storage facility, (c) a water treatment facility, (d) a building or place that is a combination of any of the things referred to in paragraphs (a)-(c). water treatment facility means a building or place used for the treatment of water (such as a desalination plant or a recycled or reclaimed water plant) whether the water produced is potable or not, and includes residuals treatment, storage and disposal facilities, but does not include a water recycling facility.
Both a water supply system and a water treatment facility are innominate prohibited uses that are not made permissible through the SEPP TI on land zoned C3.
The Council also points out that if there is more than one use of the site, and one use is not subsumed by the other and they are each independent, the proposed development is prohibited if one of the independent uses is prohibited. The Council relies on Foodbarn Pty Ltd v Solicitor-General (1975) 32 LGRA 157 (Foodbarn) at 161, in which Glass JA stated that if "any one purpose operating in a way which is independent and not merely incidental to other purposes is prohibited, it is immaterial that it may be overshadowed by the others…".
The Council submits that for the development to be properly characterised as a 'water storage facility', it would be necessary to find that the other non-storage components are not an independent use of the land. In particular, the Council says that the truck movements are not associated with the storage on the site, but instead with conveying the water from the site for a commercial purpose.

The applicants' position that the purpose is permissible

The Edwards instead submit that, in taking the 'practical and common sense' approach to the characterisation of development, in accordance with the decision in Chamwell, all of the proposed activities on the site serve the purpose of a water storage facility.
Firstly, they submit that the term 'water storage facility' necessarily requires some means by which the storage facility would be filled with water, and some means by which it can then be intentionally depleted. The applicants submit that these means are the pipe infrastructure from the extraction point to the storage point and associated ultraviolet filtration and pumps, and the truck movements in order to deplete the water. The applicant submits that all of these activities are therefore part of, or ancillary and subservient to, the dominant use for the purpose of a water storage facility. This includes the filtering of the water, which is for the purpose of storage, in accordance with the letter of Aquamann Irrigation dated 25 July 2023, which states that the "system is not designed for bottling purposes" but for "providing a safe and reliable means of exporting water as a raw material". The applicants proffers that, if the treatment of the water causes the proposed development to be characterised as something other than a water storage facility, the Court is invited to not approve the Aquamann filtration equipment. They submit that if that equipment is not approved, "there is no argument at all that this development is not for water storage".
The applicants submit that the ultimate destination of the water is not relevant to characterising the proposed development, as the use of land involves the physical acts by which the land is made to serve a purpose (relying on Chamwell) and is therefore concerned with the physical acts on the site. The applicants use the analogy of a silo, which it says would not be characterised by reference to the factory to which the wheat is transported.
Secondly, the applicants submit that the purpose of the use is not for an 'industrial activity' as there is no system or process proposed that takes raw or component materials and turns them into resulting 'goods, substances, food, products or articles for commercial purposes', consistent with that definition. They submit that the definition of 'industrial activity' requires that the activity fall squarely within one of the explicit terms of the definition, and that particular terms should not be interpreted as having a meaning that is broader than the meaning denoted by the list of activities in the definition "read as a whole". In reading the definition as a whole, the applicants submit that it can be inferred that it "denotes a factory or production-line process which takes raw or component materials and turns them into a commercial product, and does not denote the basic extraction and handling of 'raw' product, such as that proposed on the Site" (Applicant's written submissions, [58]). The applicants say that the proposed development relates simply to the extraction and handling of a non-potable raw product, and is not a factory to produce water, carbonate water, or bottle water, and is therefore not an industrial activity.
Thirdly, the applicants submit that, even if the use falls within an industrial activity, the specific permissible use of water storage facility cannot be considered also as falling with the prohibited general category of 'industries', based on both cl 2.3(3)(b) of the WLEP and the general principle that the specific overrides the general. That is, where there is a specific and narrow use that is permissible, it is not captured by a general prohibited category into which it might otherwise fall.
Fourthly, in the alternative, the applicants submit that the development is for the purpose of a water reticulation system, which, pursuant to the SEPP TI, is permissible on the site and incudes water supply reservoirs.

The purpose of the proposed development

When considering the question of characterisation, the focus of the inquiry is not to determine, at large, the category into which the proposed development should be considered to fall, but instead whether it falls within a nominate or innominate purpose in accordance with the applicable instrument: Botany Bay City Council v Pet Carriers International Pty Limited (2013) 201 LGERA 116 [2013]; NSWLEC 147 (Pet Carriers) at [32]. As stated by his Honour: "The inquiry is whether the development can be characterised as being for a purpose that the instrument identifies as being permissible with consent and not for a purpose that the instrument identifies as being permissible without consent or as being prohibited" (at [32]).
As outlined earlier, the characterisation of the purpose involves determining the end that is served by the various works and activities to be carried out by the proposed development, and is to be done at a level of generality sufficient to cover those works and activities, rather than by reference to the detailed activities, transactions or processes (Chamwell at [34]). Those works include the physical works of construction of buildings required to be used to serve that purpose (Chamwell at [29]-[30]).
To be satisfied that the proposed development is for the purpose of a water storage facility, I must be persuaded that 'water storage facility' is the end that is served by the various works and activities that are proposed to be carried out. This includes the construction of the new pipes, storage tanks, and filtration, as well as the activities of piping of water from the bores, from the existing tank to the new storage tanks, the filtration of the water, and the trucking of the water off-site.
I accept the Edwards' position that the characterisation of the use must occur without reference to what the water will be used for following its transport from the site. The word "storage" does not exclude temporary storage, and its ordinary meaning can include the temporary storage of water pending its transfer to another place for another purpose (see Environment Protection Authority v Grafil Pty Ltd; Environment Protection Authority v Mackenzie; (2019) 101 NSWLR 245; (2019) 238 LGERA 147; [2019] NSWCCA 174, Preston CJ of LEC at [190]-[191]). As submitted by the Edwards, a storage facility also must include the associated activities of it being filled and intentionally depleted.
However, it is nonetheless relevant to inquire as to whether, on the facts of the case, the storage activities proposed are for the dominant use of 'water storage facility', or whether they serve some other purpose. As stated by Glass JA in Foodbarn, "where a part of the premises is used for a purpose which is subordinate to the purpose which inspires the use of another part, it is legitimate to disregard the former and to treat the dominant purpose as that for which the whole is being used" (at 161).
This is not a case where, on the facts, there can be said to be two different purposes served by the use of the site. All of the proposed activities are carried out in a single continuous chain of events in which the water is pumped from the approved bores, passes through pipes to the existing tank, is pumped from the existing tank towards four new water storage tanks, passes through piping and filtration to arrive at the new water storage tank system, and is then pumped from the water storage tanks into a truck and transported off-site. This is distinct from the facts in cases such as Foodbarn and Baulkham Hills Shire Council v O'Donnell (1990) 69 LGRA 404, where uses for two different purposes were carried out on the site, and a decision had to be made as to whether they were independent uses or one use was ancillary or subservient to the other.
Instead, in this case, there are two alternatives: either the storage activities are for the purpose of a water storage facility and all of the other activities on the site serve that purpose, or the storage activities serve some other purpose to which all of the activities on the site are directed. Determining whether it is one or the other involves questions of fact and degree, and, using the words of Craig J in Kang v Blue Mountains City Council (2011) 185 LGERA 148; [2011] NSWLEC 150, "applying the elements of a proposed activity to a particular form of development defined in an environmental planning instrument can often yield a result about which minds may reasonably differ" (at [39]).
In considering the facts of the case, I consider that it is the latter of the two above alternatives. I am not satisfied that the activities on the site, including the storage tanks and storage activities, serve the purpose of a 'water storage facility'. This is because the storage is so transient that it forms part of a system that serves a different purpose and cannot be considered the purpose itself. The rate at which water is extracted from the proposed new tanks for transport off-site is not less than the rate of water discharged from the bores, and any storage in the interim is transient with minimal reserve capacity. That is, the proposed development is intended to operate with the piping of water that is pumped from the bores at 0.20736 ML a day (Ex A, p 35) and trucked from the site at 0.2475 ML or 0.2488 ML a day depending on the type of truck used (Ex A, p 126). The existing storage tank has the capacity to hold more than the daily volume pumped from the bores (0.27 ML) (Ex A, p 124) and the proposed tank system has the capacity to hold slightly less than the daily volume (0.2 ML). Due to the proposed filtration system between the existing and proposed tanks, the water must pass through both the existing tank and the proposed tank system.
I consider that when you have a daily volume of water that is pumped from the bores passing through a system of pipes and tanks that caters for that daily volume, with minimal reserve volume when each of the existing and proposed tanks are considered as two separate components (as the water has to pass through both), proposed then to be trucked from the site at a similar daily volume, any storage within that system is transient and subordinate to the purpose served by that system as a whole. To put it simply, the storage tanks do not have sufficient reserve capacity to be considered as something other than part of a system through which the daily volume of water passes. The end that this system serves is not storage, but, as set out further below, is to extract and produce water.
Even if I was to consider the total capacity together of the existing and proposed tanks (0.47 ML), to pump water from the bores at the rate anticipated (0.20736 ML a day), the water would eventually have to be extracted from the tanks to the trucks at the same rate, with only two days initial headroom in which the water could be stored within the system. Again, I consider that any such storage is so brief so as to be subordinate to the purpose served by the system as a whole.
I similarly do not accept that the system as a whole can be described as being for the purpose of a water reticulation system. Whilst one of the activities carried out by the proposed development is water reticulation, in that there are pipes and buildings for transporting water, water reticulation is not the end served by those activities. I accept the Council's submission that the definition of "water reticulation system", even including water supply reservoirs, is not sufficiently broad to extend to the export of water from the site. As such, to so characterise the purpose of the use by reference to only one aspect of the system would fail to be at the level of generality sufficient to cover all of the works and activities on the site (Chamwell at [34]). As such, the water reticulation system forms part of the proposed activities and system as a whole but is not the end purpose of that system.
Having determined that the proposed development is not for the purpose of a water storage facility or a water reticulation system, the question then arises as to the characterisation of the purpose served by the system as a whole. On this point, I accept the position of the Council that the purpose is for industry, for two reasons.
Firstly, the evidence is that the purpose is for the production of 'mineral water', being extracted groundwater that can be made safe for consumption.
Whilst the SEE dated October 2021 states that the purpose sought is for the storage of water, the storage is "prior to being pumped into purpose designed bulk water tankers for delivery off site" (Ex A, p 10) and the water tankers are used for dispatch "to remote bottling facilities" (Ex A, pp 17-18).
The development application is also supported by a report by Hydroilex Geological Consultants dated 27 October 2021, which is referred to in the SEE. This report describes the proposal as supplementing agricultural activities "with the extraction of high quality 'spring water'" (Ex A, p 33). It then identifies the environmental issues and proposed monitoring bore by reference to "the requirements for 'mineral water' production" (Ex A, p 33). It identifies the groundwater monitoring and management required for such production, and includes the following in its summary (Ex A, p 36): "In view that the site and subject bores have a current 'irrigation' usage, the proposal for mineral water extraction is considered to have no impact on the aquifer system".
The Addendum Statement of Environmental Effects dated 28 July 2023 relies on the letter from Aquamann Irrigation dated 25 July 2023, which states that the filtration system "guarantees the removal of any particles that may be present in the ground, ensuring that the water is clean and free from impurities" (Ex A, p 129). The letter concludes that the "focus is solely on providing a safe and reliable means of exporting water as a raw material" (Ex A, p 129).
I therefore consider that, based on this evidence, the purpose of the proposed development is for the production of extracted groundwater that can be made suitable for consumption. All of the proposed buildings and activities in the development application are directed to this purpose, including the pumping of the water from the bores through pipes to an existing tank, the filtration of the water as it is pumped to the proposed storage tank system from the existing tank, and the extraction of that water from the new storage tanks to trucks for export from the site.
The actual use that the water is later put to after transport from the site, or the fact that the water might need to be further treated at another site prior to bottling, is not relevant.
Secondly, the system and activities all meet the definition of "industrial activity" under the WLEP. Consistent with the decision of the Court in Liauw and Waterland, groundwater is a "product" and therefore falls within the term "goods, substances, food, products or articles" for the purpose of the definition of "industrial activity". The proposed activities on the site are for the "production" of that product as they involve the pumping and piping of water from the bores to the existing tank, the filtration of the water, and the pumping and piping of the water to the proposed tank system from which the water is capable of being extracted to fill water tanker trucks. The purpose of the proposed development is therefore for "production" of the water "product", consistent with the definition of industrial activity. On the evidence, the production of the water is for commercial purposes, because it is capable of returning a profit (see Acers v Wollondilly Shire Council [2014] NSWLEC 1169 at [23]-[24]). That evidence is that around 0.2ML of water a day is being "pumped into purpose designed bulk water tankers for delivery off site" (Ex A, p 10) which can be for dispatch "to remote bottling facilities" (Ex A, pp 17-18), with a focus on "exporting water as a raw material" (Ex A, p 129). This delivery, dispatch or export of the water at the rate sought is capable of returning a profit on an ongoing basis, and the production of water on the site is therefore for commercial purposes.
In reaching the above conclusion, I do not accept the submission made by the Edwards that the definition of "industrial activity" does not relate to the production of a raw product. One of the reasons given for advancing this submission is that extractive industry and rural industry, which concern raw materials, are excluded from the definition of industry. I do not accept that you can interpret the definition of "industrial activity" by reference to categories excluded from the definition of "industry". If the proposed development fell within the excluded categories, the definition of "industrial activity" would not be relevant. There is nothing in the wording of the "industrial activity" definition that excludes certain types of products. Further, and contrary to the Edwards' submission, the definition of "industrial activity" does not require there to be a factory or production-line. Instead, the word "production" is sufficiently broad to include the proposed activities on the site, described above at [60].
Therefore, I consider that the proposed development is a building or place that is used to carry out an industrial activity. Given that there is no evidence of any impacts on "the amenity of the neighbourhood by reason of noise, vibration, smell, fumes, smoke, vapour, steam, soot, ash, dust, waste water, waste products, grit or oil, or otherwise", the proposed development meets the definition of light industry. Even if the proposed truck movements could be seen to impact "the amenity of the neighbourhood" such that the proposed development is not a light industry, it would fall within the definition of general industry. Both general industry and light industry fall within the defined category of land use called industry, and industries are a nominated prohibited use on the site. The development application therefore seeks consent for a use that is prohibited on the site, and must be refused on that basis.

The applicants' position that it is open to the Court to not approve the filtration system

The Court has the power, pursuant to s 4.16(4) of the EPA Act, to grant consent to the development for which consent was sought, except for "a specified part or aspect of that development". This is the power that would need to be exercised to entertain the offer made on behalf of the applicants that the Court could choose not to approve the Aquamann filtration equipment. However, there are three problems with exercising this power in the manner suggested. The first two create a legal impediment, and the third relates to the facts of the case.
Firstly, Part 4 of the EPA Act only allows a development application to be made for development that may not be carried out except with development consent (ss 4.2, 4.9). Section 4.9 makes it clear that Div 4.3, which contains s 4.16, applies to development that may not be carried out except with development consent. Accordingly, there must be a development application for development that is permissible with development consent before the power in s 4.16(4) can be exercised to grant total or partial consent (see Pet Carriers at [5], [31]), and a development application for a prohibited development is not an application in terms of the EPA Act (see Chambers v Maclean Shire Council & 2 Ors [2003] NSWCA 100; (2003) 57 NSWLR 152; (2003) 126 LGERA 7 at [37], [38]). As stated by Preston CJ of LEC in Forgall Pty Ltd v Greater Taree City Council [2015] NSWLEC 61, "[t]here is no power to grant consent to a development application for prohibited development".
In circumstances where I have found that the Aquamann filtration equipment forms part of a proposed system on the site which is for the purpose of an industry, which is a purpose that is prohibited under the applicable environmental planning instrument, the application is not a development application in terms of Div 4.3 of the EPA Act and s 4.16 is not engaged to allow the Court to determine the development application either at all or in the manner suggested by the applicants.
Secondly, the Court has no power to consider a development application that is not the subject of the appeal (see Ku-ring-gai Council v Bunnings Properties (2019) 236 LGERA 35; Pty Ltd [2019] NSWCA 28 at [202]). The application, at present, is for development that is prohibited and is therefore not a development application for the purpose of Div 4.3 of the EPA Act. I have found that all of the proposed buildings and activities proposed in the application are directed to that prohibited purpose, including the filtration of water as it is pumped to the proposed storage tank system from the existing tank (see [49]-[60]). Even if it could be established that the removal of the filtration equipment renders the purpose of the development one that is a use that is permissible with consent, the filtration equipment cannot be severed from the proposed development to consider an alternative, hypothetical development application that is not before the Court.
Thirdly, as set out above at [51], I have found that, even if I was to consider the total capacity of all the storage tanks, any such storage is nonetheless so brief that it is subordinate to the purpose served by the system as a whole. Therefore, even if all the storage tanks are considered as one, without reference to the need for the water to pass through the filtration equipment, there is no change to my finding that the purpose served by the system as a whole is not a water storage facility.
For those reasons, there is no legal or factual basis upon which I can exercise the power in s 4.16(4) of the EPA Act to grant a partial consent in which I grant consent to the development, except for the Aquamann filtration system.
As I have determined that the proper characterisation of the proposed development is for a use that is prohibited in the C3 zone in which the site is located, there is no power to grant development consent and the development application must be refused on that basis.

The remaining contentions

The Council raised a number of additional contentions concerning traffic safety, including a contention that two vehicles of the size utilised by the development cannot safely pass one another on Canyonleigh Road due to the road width, and a contention that the sight distance to the east for a vehicle leaving the driveway is inadequate. Given my finding above that the development application must be refused, I need not consider those contentions. However, I ought to make two brief observations.
Firstly, the potential conflict arising from the two-way passing of vehicles on Canyonleigh Road (leaving aside the fact that the narrow width arises due to the Council not building the road in accordance with the Austroads Guide to Road Design) is completely avoided by the proposal for truck movements to be in accordance with the Heavy Vehicle Access Plan. Such a plan would be enforceable through a condition of consent. It can be assumed that a person benefitting from the consent will observe the conditions imposed on that consent (TL & TL Tradings Pty Ltd v City of Parramatta Council [2019] NSWLEC 160 at [13]).
Secondly, with respect to sightlines from the driveway of the development, it is evident that the proposed development complies with the sightlines required by Clause 3.4.5 of AS 2890.2:2018 for a 5s gap. The circumstances requiring a sightline for "up to an 8s gap" do not arise. The AS 2890.2:2018 is the current Australian Standard for off-street commercial vehicle facilities, including design requirements for access driveways for commercial vehicles across the property boundary. It is directly relevant to the driveway the subject of the proposed development. The AS 2890.1:2004, which was variously referred to by the Council and Mr McCarthy, is instead for parking facilities for "motor cars, light vans and motorcycles". It is not appropriate for the Court to set aside or disregard a relevant and scientifically credible standard developed by industry experts, such as the AS 2890.2:2018, and it is not the role of the Court to pioneer standards of its own in reliance on an individual expert or otherwise: Telstra Corporation Limited v Hornsby Shire Council (2006) 146 LGERA 10; (2006) 67 NSWLR 256 at [98]-[99]; Icon Hospitality Group Pty Ltd v Council of the City of Sydney [2010] NSWLEC 1186 at [32]; and McClelland v Wollongong City Council [2011] NSWLEC 1138 at [47]-[48].
However, it is unnecessary to make any final determination on these contentions given the above finding that the development application must be refused on the basis that the proper characterisation of the proposed development is not for a water storage facility, but is for a use that is prohibited on the site.

Final orders

The Court orders that: 1. The appeal is dismissed. 2. The development application DA22/0800 for carrying out of works and use of the site at Lot 1 DP 867173 and Lot 152 DP 751284 for the extraction, piping, filtration, storage and transport of groundwater is determined by refusal. 3. Exhibits B, C and 1-5 are returned, and exhibit A is retained.

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: 12 April 2024

Telstra Corporation Limited v Hornsby Shire Council (2006) 67 NSWLR 256; (2006) 146 LGERA 10; [2006] NSWLEC 133

TL & TL Tradings Pty Ltd v City of Parramatta Council [2019] NSWLEC 160

Waterland Blue Mountain Natural Water Pty Ltd v Blue Mountains City Council [2006] NSWLEC 537

Australian Standard AS 2890.1:2004 Parking Facilities, Part 1: Off-street car parking

Australian Standard AS 2890.2:2018 Parking Facilities, Part 2: Off-street commercial vehicle facilities

Wingecarribee Shire Rural Lands Development Control Plan 2021

COMMISSIONER: At a site that is known as 2500 Canyonleigh Road, Canyonleigh, there are two existing licensed water bores. Edwards Pension Fund Pty Ltd and Paul D Edwards Pty Ltd (the Edwards) seek development consent for water extracted from the bores to be piped, filtered, stored and transported from the site. By their agent, the Edwards lodged a development application with Wingecarribee Shire Council (the Council) on 1 November 2021 seeking the use of the property for "water extraction, storage and distribution off site" (Ex A p 3). The development application was refused on 11 October 2022. These proceedings are an appeal against that decision, pursuant to s 8.7 of the Environmental Planning and Assessment Act 1979 (EPA Act).
The proposed development is described in the Statement of Environmental Effects (SEE) in the following way (Ex A, p 17-18):

"The development will operate as follows:

• Water will be extracted from the two existing approved licensed bores to the existing storage tank (capacity of approximately 275,000 litres) that is approximately 20 metres south west of the shed

• Water is then transferred to the existing metal farm shed that will accommodate 4 x 50,000 litre stainless steel water storage tanks, filtration system and pumping equipment

• Trucks will access the site from the existing driveway crossing to transfer water from the internal storage tanks into the water tankers, for despatch to remote bottling facilities. These trucks will be general access "short B - Double" combinations up to 19m in length and 57 tonne mass."

The development is proposed to operate on weekdays, excluding public holidays, with up to 10 trucks servicing the site each day.
The Edwards characterise the proposed development as being for the purposes of a water storage facility, which is permissible in the C3 Environmental Management zone in which the site is located, pursuant to the Wingecarribee Local Environmental Plan 2010 (WLEP).
However, the Council remains opposed to the proposed development. It says that the proposed development is prohibited as it cannot be characterised as being for the purpose of a water storage facility, and that it has unacceptable traffic safety impacts.
For the reasons that are set out below, I have determined that the proper characterisation of the purpose of the proposed development is industry, which is a use that is prohibited in the zone. There is therefore no power to grant development consent.

The site is known as 2500 Canyonleigh Road, Canyonleigh, and comprises two allotments legally described as Lot 152 DP 751284 and Lot 1 DP 867173. It is a total of 146.3ha and has a frontage of 260m to Canyonleigh Road. There is a gravel vehicular driveway that accesses Canyonleigh Road through cultivated olive trees on the north west corner of the site, and the driveway then provides access to a large shed around which the driveway loops. An existing storage tank is located immediately adjacent to the large shed.
Canyonleigh Road is accessed directly from the Hume Highway, which is 7km to the east. Surrounding properties are mainly used for agriculture, with some residential accommodation, all of which are accessed directly from Canyonleigh Road. The nearest local centre is Exeter Village, which is 13km to the east, on the other side of the Hume Highway. To the west, Canyonleigh intersects with Tugalong Road before becoming an unsealed road leading to private properties, and Tugalong Road runs north providing access to a large number of other rural properties either directly or via local roads.

The zoning table for the C3 Environmental Management zone is as follows:

2 Permitted without consent

Environmental protection works; Extensive agriculture; Home-based child care; Home occupations

3 Permitted with consent

Agricultural produce industries; Agritourism; Airstrips; Bed and breakfast accommodation; Cellar door premises; Community facilities; Dairies (pasture-based); Dual occupancies (attached); Dwelling houses; Eco-tourist facilities; Environmental facilities; Farm buildings; Farm stay accommodation; Flood mitigation works; Health consulting rooms; Helipads; Home businesses; Horticulture; Information and education facilities; Oyster aquaculture; Places of public worship; Pond-based aquaculture; Recreation areas; Recreation facilities (outdoor); Roads; Roadside stalls; Secondary dwellings; Signage; Tank-based aquaculture; Viticulture; Water storage facilities

4 Prohibited

Industries; Local distribution premises; Multi dwelling housing; Residential flat buildings; Retail premises; Seniors housing; Service stations; Warehouse or distribution centres; Any other development not specified in item 2 or 3

"Water storage facilities" is a nominated permissible use in the zone, "industries" are a nominated prohibited use, and any use not nominated in the zoning table is an innominate prohibited use.
In addition, the State Environmental Planning Policy (Transport and Infrastructure) 2021 (SEPP TI) makes development for the purpose of water reticulation systems permissible with consent on any land, in s 2.161, and contains the following definition:

water reticulation system has the same meaning as in the Standard Instrument but also includes water supply reservoirs.

The meaning contained in the Standard Instrument, which is replicated in the WLEP, is set out further below.
The objectives of the C3 zone are as follows:

• To protect, manage and restore areas with special ecological, scientific, cultural or aesthetic values.

• To provide for a limited range of development that does not have an adverse effect on those values.

• To encourage the retention of the remaining evidence of significant historic and social values expressed in existing landscape and land use patterns.

• To minimise the proliferation of buildings and other structures in these sensitive landscape areas.

• To provide for a restricted range of development and land use activities that provide for rural settlement, sustainable agriculture, other types of economic and employment development, recreation and community amenity in identified drinking water catchment areas.

• To protect significant agricultural resources (soil, water and vegetation) in recognition of their value to Wingecarribee's longer term economic sustainability.

The Wingecarribee Shire Rural Lands Development Control Plan 2021 (WSRLDCP) applies to the site, but contains no controls concerning driveway access, road access and sight lines for a development of this type. It contains only the following controls concerning water storage facilities:

"A5.8.3 Controls

To meet the above objectives Council shall require development to comply with the following controls.

(a) All Water Storage Facilities shall obtain relevant state and local government licenses and / or approvals.

(b) Applications should address all relevant site planning and environmental controls detailed within this DCP.

(c) Applications should include a detailed site plan showing the location of the proposed facility in relation to all water courses, gradient and overland run off catchments.

(d) Details of expected volume in the facility, potential contaminants, sediment and erosion control and location of any associated equipment shall be provided in the application.

(e) All Water Storage Facilities shall be constructed utilising the relevant best practice methodologies.

(f) No recycled building products or building waste shall be used in the construction of Water Storage Facilities and associated hard stand areas."

Expert opinion evidence on the traffic and road safety issues raised by the Council was given by Mr Navin Prasad, a traffic engineer engaged by the applicants, and Mr Matthew McCarthy, a traffic engineer engaged by the Council.
Mr McCarthy's evidence is that the driveway entrance should be widened to allow simultaneous two-way movements within the site. He also opines that the sight distance to the east at the driveway interface with Canyonleigh Road is insufficient to ensure safe movement of vehicles from the site into the Canyonleigh Road, relying on his own calculation of the sight distance required. In support of his position, he relies on a study by Austroads that conducted field tests for gap acceptance by drivers. In oral evidence, Mr McCarthy agreed that the field tests for gap acceptance relate to perceptions of what a safe gap is, rather than relating to actual safe distances to complete a turn.
Further, Mr McCarthy opines that Canyonleigh Road is not of sufficient width to allow two vehicles of the size required by the development to pass simultaneously.
Mr Prasad instead relies upon Australian Standard AS 2890.2:2018, which concerns off-street commercial vehicle facilities, and says that the access driveway has been designed in accordance with that standard and the sightlines similarly comply with the same. Therefore, he concludes that two way passing is not required in the access driveway entrance, and that the sightlines are sufficient.
In addition, Mr Prasad relies on a Heavy Vehicle Access Plan that is proposed for the development, which provides a schedule of the truck movements for the site. Compliance with this plan, which can form a condition of the development consent, would ensure that trucks using the site would not pass another truck on the site, nor another truck travelling to/from the site on Canyonleigh Road.

It is well established that development is for a purpose (see Shire of Perth v O'Keefe [1964] HCA 37; (1964) 110 CLR 529), and I must be satisfied that the development proposed in the development application is for the purpose of a use that is permissible with development consent.
A water storage facility, which is permissible on the site, is defined in the WLEP as follows:

Water storage facility means a dam, weir or reservoir for the collection and storage of water, and includes associated monitoring or gauging equipment

The parties agree that the storage tanks proposed are a type of "reservoir", however they remain in disagreement as to whether the purpose of the proposed use is for a water storage facility as defined.
As stated by Preston CJ in Chamwell Pty Limited v Strathfield Council (2007) 151 LGERA 400; [2007] NSWLEC 114 (Chamwell), the purpose of the use is "the end to which land is seen to serve" (at [27]).
In determining the purpose of the proposed use, I must consider what end is served by the various works and activities to be carried out. Rather than dividing the proposal into its component parts, which includes the extraction and piping of water, the filtration of the water, the construction of tanks, the storage of the water in tanks, and its transport off the site, I must determine the end served by these physical acts.

The Council's position that the purpose is not for a permissible use

The Council's position is that the activities the subject of the development application are directed to the production of potable, bottled water. It describes the activities the subject of the development application as follows (Respondent Written Submissions, p.6):

"● the extraction of the water into the first tank.

● the passing of the extracted water through the filtration and disinfection system to render it potable.

● the construction of new tanks to receive the filtered and disinfected water and quarantine it from the freshly extracted, untreated water;

● the temporary storage of that water in the new tanks until it is transported;

● the filling of tankers from those tanks; and

● the transportation of that water by those tankers to a bottling facility on other land."

The Council points out that all of the water to be extracted from the bores will be exported from the site, so that when you have regard to all of the activities on the site it cannot be for the purpose of a storage facility. The Council submits that these activities are directed to the production of water, which falls within "industries", a prohibited use in the zone. The relevant definitions concerning industry are as follows:

industry means any of the following -

(a) general industry,

(b) heavy industry,

(c) light industry,

but does not include -

(d) rural industry, or

(e) extractive industry, or

(f) mining.

general industry means a building or place (other than a heavy industry or light industry) that is used to carry out an industrial activity.

heavy industry means a building or place used to carry out an industrial activity that requires separation from other development because of the nature of the processes involved, or the materials used, stored or produced, and includes -

(a) hazardous industry, or

(b) offensive industry.

It may also involve the use of a hazardous storage establishment or offensive storage establishment.

light industry means a building or place used to carry out an industrial activity that does not interfere with the amenity of the neighbourhood by reason of noise, vibration, smell, fumes, smoke, vapour, steam, soot, ash, dust, waste water, waste products, grit or oil, or otherwise, and includes any of the following -

(a) high technology industry,

(b) home industry,

(c) artisan food and drink industry,

(d) creative industry.

industrial activity means the manufacturing, production, assembling, altering, formulating, repairing, renovating, ornamenting, finishing, cleaning, washing, dismantling, transforming, processing, recycling, adapting or servicing of, or the research and development of, any goods, substances, food, products or articles for commercial purposes, and includes any storage or transportation associated with any such activity.

Having regard to the definitions of rural industry, extractive industry, or mining, which I do not repeat, there is no dispute that the proposed development does not fall within one of those industries.
The Council submits that the definition of "industrial activity" is sufficiently broad to cover the aspects of extraction of water, storage of water, filtration of extracted water, and ultimate transportation of that water. Its position is that the production and transport of treated water is proposed at a significant scale, as it is sufficient to fill up to 10 tankers per day. The Council submits that the truck movements are not incidental, or ancillary to, a water storage use but arise because the purpose of using the extracted water is to produce a product, that is water for bottling. In support of this submission, the Council points out that the traffic assessment is premised on the assumption that the entire 70ML of water extracted will be removed from the site for bottling operations (Ex A, Tab 18, p 212). The Council therefore submits that the most fitting characterisation of the purpose of the development is as either a general industry or a light industry, both of which are prohibited on the site by reason of them being species of the genus of "industries". It submits that the water extraction, water storage, water treatment and truck movements are all components of that use.
In support of its position, the Council relies on a number of decisions of the Court. In particular, in both Liauw v Gosford City Council (2004) 136 LGERA 349; [2004] NSWLEC 72 (Liauw) and Waterland Blue Mountain Natural Water Pty Ltd v Blue Mountains City Council [2006] NSWLEC 537 (Waterland), groundwater was held to be a "primary product" for the purpose of applying the relevant definition of "rural industry" (which is no longer a definition which would encompass this form of development). The Council submits that, although the definition of "rural industry" has changed, these decisions confirm that, for the purpose of applying the definition of "industrial activity" under the WLEP, groundwater is capable of falling within the term "goods, substances, food, products or articles". In addition, in Waterland, the nature of the development was similar to that proposed in the present application, in that it involved extraction and storage of pumped water, and then transport from the site to another facility, and the Court held that the activities met the description of "handling, treating, processing or packing of primary products".
The Council also submits that the truck facilities, and the tanks and water treatment, do not fit within the scope of a use for the purpose of a "water reticulation system", which is permissible on the site pursuant to the SEPP TI. A water reticulation system has the following definition:

water reticulation system means a building or place used for the transport of water, including pipes, tunnels, canals, pumping stations, related electricity infrastructure and dosing facilities.

In the SEPP TI, a water reticulation system also includes water supply reservoirs. The Council submits that the purpose of the use is not for a water reticulation system, as the transport of the water from the site is not a "building or place" used for the transport of water, and is not a use that forms part of, or is subsumed into, a water reticulation system.
The other definitions of relevance are:

water supply system means any of the following -

(a) a water reticulation system,

(b) a water storage facility,

(c) a water treatment facility,

(d) a building or place that is a combination of any of the things referred to in paragraphs (a)-(c).

water treatment facility means a building or place used for the treatment of water (such as a desalination plant or a recycled or reclaimed water plant) whether the water produced is potable or not, and includes residuals treatment, storage and disposal facilities, but does not include a water recycling facility.

Both a water supply system and a water treatment facility are innominate prohibited uses that are not made permissible through the SEPP TI on land zoned C3.
The Council also points out that if there is more than one use of the site, and one use is not subsumed by the other and they are each independent, the proposed development is prohibited if one of the independent uses is prohibited. The Council relies on Foodbarn Pty Ltd v Solicitor-General (1975) 32 LGRA 157 (Foodbarn) at 161, in which Glass JA stated that if "any one purpose operating in a way which is independent and not merely incidental to other purposes is prohibited, it is immaterial that it may be overshadowed by the others...".
The Council submits that for the development to be properly characterised as a 'water storage facility', it would be necessary to find that the other non-storage components are not an independent use of the land. In particular, the Council says that the truck movements are not associated with the storage on the site, but instead with conveying the water from the site for a commercial purpose.

The applicants' position that the purpose is permissible

The Edwards instead submit that, in taking the 'practical and common sense' approach to the characterisation of development, in accordance with the decision in Chamwell, all of the proposed activities on the site serve the purpose of a water storage facility.
Firstly, they submit that the term 'water storage facility' necessarily requires some means by which the storage facility would be filled with water, and some means by which it can then be intentionally depleted. The applicants submit that these means are the pipe infrastructure from the extraction point to the storage point and associated ultraviolet filtration and pumps, and the truck movements in order to deplete the water. The applicant submits that all of these activities are therefore part of, or ancillary and subservient to, the dominant use for the purpose of a water storage facility. This includes the filtering of the water, which is for the purpose of storage, in accordance with the letter of Aquamann Irrigation dated 25 July 2023, which states that the "system is not designed for bottling purposes" but for "providing a safe and reliable means of exporting water as a raw material". The applicants proffers that, if the treatment of the water causes the proposed development to be characterised as something other than a water storage facility, the Court is invited to not approve the Aquamann filtration equipment. They submit that if that equipment is not approved, "there is no argument at all that this development is not for water storage".
The applicants submit that the ultimate destination of the water is not relevant to characterising the proposed development, as the use of land involves the physical acts by which the land is made to serve a purpose (relying on Chamwell) and is therefore concerned with the physical acts on the site. The applicants use the analogy of a silo, which it says would not be characterised by reference to the factory to which the wheat is transported.
Secondly, the applicants submit that the purpose of the use is not for an 'industrial activity' as there is no system or process proposed that takes raw or component materials and turns them into resulting 'goods, substances, food, products or articles for commercial purposes', consistent with that definition. They submit that the definition of 'industrial activity' requires that the activity fall squarely within one of the explicit terms of the definition, and that particular terms should not be interpreted as having a meaning that is broader than the meaning denoted by the list of activities in the definition "read as a whole". In reading the definition as a whole, the applicants submit that it can be inferred that it "denotes a factory or production-line process which takes raw or component materials and turns them into a commercial product, and does not denote the basic extraction and handling of 'raw' product, such as that proposed on the Site" (Applicant's written submissions, [58]). The applicants say that the proposed development relates simply to the extraction and handling of a non-potable raw product, and is not a factory to produce water, carbonate water, or bottle water, and is therefore not an industrial activity.
Thirdly, the applicants submit that, even if the use falls within an industrial activity, the specific permissible use of water storage facility cannot be considered also as falling with the prohibited general category of 'industries', based on both cl 2.3(3)(b) of the WLEP and the general principle that the specific overrides the general. That is, where there is a specific and narrow use that is permissible, it is not captured by a general prohibited category into which it might otherwise fall.
Fourthly, in the alternative, the applicants submit that the development is for the purpose of a water reticulation system, which, pursuant to the SEPP TI, is permissible on the site and incudes water supply reservoirs.

When considering the question of characterisation, the focus of the inquiry is not to determine, at large, the category into which the proposed development should be considered to fall, but instead whether it falls within a nominate or innominate purpose in accordance with the applicable instrument: Botany Bay City Council v Pet Carriers International Pty Limited (2013) 201 LGERA 116 [2013]; NSWLEC 147 (Pet Carriers) at [32]. As stated by his Honour:

"The inquiry is whether the development can be characterised as being for a purpose that the instrument identifies as being permissible with consent and not for a purpose that the instrument identifies as being permissible without consent or as being prohibited" (at [32]).

As outlined earlier, the characterisation of the purpose involves determining the end that is served by the various works and activities to be carried out by the proposed development, and is to be done at a level of generality sufficient to cover those works and activities, rather than by reference to the detailed activities, transactions or processes (Chamwell at [34]). Those works include the physical works of construction of buildings required to be used to serve that purpose (Chamwell at [29]-[30]).
To be satisfied that the proposed development is for the purpose of a water storage facility, I must be persuaded that 'water storage facility' is the end that is served by the various works and activities that are proposed to be carried out. This includes the construction of the new pipes, storage tanks, and filtration, as well as the activities of piping of water from the bores, from the existing tank to the new storage tanks, the filtration of the water, and the trucking of the water off-site.
I accept the Edwards' position that the characterisation of the use must occur without reference to what the water will be used for following its transport from the site. The word "storage" does not exclude temporary storage, and its ordinary meaning can include the temporary storage of water pending its transfer to another place for another purpose (see Environment Protection Authority v Grafil Pty Ltd; Environment Protection Authority v Mackenzie; (2019) 101 NSWLR 245; (2019) 238 LGERA 147; [2019] NSWCCA 174, Preston CJ of LEC at [190]-[191]). As submitted by the Edwards, a storage facility also must include the associated activities of it being filled and intentionally depleted.
However, it is nonetheless relevant to inquire as to whether, on the facts of the case, the storage activities proposed are for the dominant use of 'water storage facility', or whether they serve some other purpose. As stated by Glass JA in Foodbarn, "where a part of the premises is used for a purpose which is subordinate to the purpose which inspires the use of another part, it is legitimate to disregard the former and to treat the dominant purpose as that for which the whole is being used" (at 161).
This is not a case where, on the facts, there can be said to be two different purposes served by the use of the site. All of the proposed activities are carried out in a single continuous chain of events in which the water is pumped from the approved bores, passes through pipes to the existing tank, is pumped from the existing tank towards four new water storage tanks, passes through piping and filtration to arrive at the new water storage tank system, and is then pumped from the water storage tanks into a truck and transported off-site. This is distinct from the facts in cases such as Foodbarn and Baulkham Hills Shire Council v O'Donnell (1990) 69 LGRA 404, where uses for two different purposes were carried out on the site, and a decision had to be made as to whether they were independent uses or one use was ancillary or subservient to the other.
Instead, in this case, there are two alternatives: either the storage activities are for the purpose of a water storage facility and all of the other activities on the site serve that purpose, or the storage activities serve some other purpose to which all of the activities on the site are directed. Determining whether it is one or the other involves questions of fact and degree, and, using the words of Craig J in Kang v Blue Mountains City Council (2011) 185 LGERA 148; [2011] NSWLEC 150, "applying the elements of a proposed activity to a particular form of development defined in an environmental planning instrument can often yield a result about which minds may reasonably differ" (at [39]).
In considering the facts of the case, I consider that it is the latter of the two above alternatives. I am not satisfied that the activities on the site, including the storage tanks and storage activities, serve the purpose of a 'water storage facility'. This is because the storage is so transient that it forms part of a system that serves a different purpose and cannot be considered the purpose itself. The rate at which water is extracted from the proposed new tanks for transport off-site is not less than the rate of water discharged from the bores, and any storage in the interim is transient with minimal reserve capacity. That is, the proposed development is intended to operate with the piping of water that is pumped from the bores at 0.20736 ML a day (Ex A, p 35) and trucked from the site at 0.2475 ML or 0.2488 ML a day depending on the type of truck used (Ex A, p 126). The existing storage tank has the capacity to hold more than the daily volume pumped from the bores (0.27 ML) (Ex A, p 124) and the proposed tank system has the capacity to hold slightly less than the daily volume (0.2 ML). Due to the proposed filtration system between the existing and proposed tanks, the water must pass through both the existing tank and the proposed tank system.
I consider that when you have a daily volume of water that is pumped from the bores passing through a system of pipes and tanks that caters for that daily volume, with minimal reserve volume when each of the existing and proposed tanks are considered as two separate components (as the water has to pass through both), proposed then to be trucked from the site at a similar daily volume, any storage within that system is transient and subordinate to the purpose served by that system as a whole. To put it simply, the storage tanks do not have sufficient reserve capacity to be considered as something other than part of a system through which the daily volume of water passes. The end that this system serves is not storage, but, as set out further below, is to extract and produce water.
Even if I was to consider the total capacity together of the existing and proposed tanks (0.47 ML), to pump water from the bores at the rate anticipated (0.20736 ML a day), the water would eventually have to be extracted from the tanks to the trucks at the same rate, with only two days initial headroom in which the water could be stored within the system. Again, I consider that any such storage is so brief so as to be subordinate to the purpose served by the system as a whole.
I similarly do not accept that the system as a whole can be described as being for the purpose of a water reticulation system. Whilst one of the activities carried out by the proposed development is water reticulation, in that there are pipes and buildings for transporting water, water reticulation is not the end served by those activities. I accept the Council's submission that the definition of "water reticulation system", even including water supply reservoirs, is not sufficiently broad to extend to the export of water from the site. As such, to so characterise the purpose of the use by reference to only one aspect of the system would fail to be at the level of generality sufficient to cover all of the works and activities on the site (Chamwell at [34]). As such, the water reticulation system forms part of the proposed activities and system as a whole but is not the end purpose of that system.
Having determined that the proposed development is not for the purpose of a water storage facility or a water reticulation system, the question then arises as to the characterisation of the purpose served by the system as a whole. On this point, I accept the position of the Council that the purpose is for industry, for two reasons.
Firstly, the evidence is that the purpose is for the production of 'mineral water', being extracted groundwater that can be made safe for consumption.
Whilst the SEE dated October 2021 states that the purpose sought is for the storage of water, the storage is "prior to being pumped into purpose designed bulk water tankers for delivery off site" (Ex A, p 10) and the water tankers are used for dispatch "to remote bottling facilities" (Ex A, pp 17-18).
The development application is also supported by a report by Hydroilex Geological Consultants dated 27 October 2021, which is referred to in the SEE. This report describes the proposal as supplementing agricultural activities "with the extraction of high quality 'spring water'" (Ex A, p 33). It then identifies the environmental issues and proposed monitoring bore by reference to "the requirements for 'mineral water' production" (Ex A, p 33). It identifies the groundwater monitoring and management required for such production, and includes the following in its summary (Ex A, p 36):

"In view that the site and subject bores have a current 'irrigation' usage, the proposal for mineral water extraction is considered to have no impact on the aquifer system".

The Addendum Statement of Environmental Effects dated 28 July 2023 relies on the letter from Aquamann Irrigation dated 25 July 2023, which states that the filtration system "guarantees the removal of any particles that may be present in the ground, ensuring that the water is clean and free from impurities" (Ex A, p 129). The letter concludes that the "focus is solely on providing a safe and reliable means of exporting water as a raw material" (Ex A, p 129).
I therefore consider that, based on this evidence, the purpose of the proposed development is for the production of extracted groundwater that can be made suitable for consumption. All of the proposed buildings and activities in the development application are directed to this purpose, including the pumping of the water from the bores through pipes to an existing tank, the filtration of the water as it is pumped to the proposed storage tank system from the existing tank, and the extraction of that water from the new storage tanks to trucks for export from the site.
The actual use that the water is later put to after transport from the site, or the fact that the water might need to be further treated at another site prior to bottling, is not relevant.
Secondly, the system and activities all meet the definition of "industrial activity" under the WLEP. Consistent with the decision of the Court in Liauw and Waterland, groundwater is a "product" and therefore falls within the term "goods, substances, food, products or articles" for the purpose of the definition of "industrial activity". The proposed activities on the site are for the "production" of that product as they involve the pumping and piping of water from the bores to the existing tank, the filtration of the water, and the pumping and piping of the water to the proposed tank system from which the water is capable of being extracted to fill water tanker trucks. The purpose of the proposed development is therefore for "production" of the water "product", consistent with the definition of industrial activity. On the evidence, the production of the water is for commercial purposes, because it is capable of returning a profit (see Acers v Wollondilly Shire Council [2014] NSWLEC 1169 at [23]- [24]). That evidence is that around 0.2ML of water a day is being "pumped into purpose designed bulk water tankers for delivery off site" (Ex A, p 10) which can be for dispatch "to remote bottling facilities" (Ex A, pp 17-18), with a focus on "exporting water as a raw material" (Ex A, p 129). This delivery, dispatch or export of the water at the rate sought is capable of returning a profit on an ongoing basis, and the production of water on the site is therefore for commercial purposes.
In reaching the above conclusion, I do not accept the submission made by the Edwards that the definition of "industrial activity" does not relate to the production of a raw product. One of the reasons given for advancing this submission is that extractive industry and rural industry, which concern raw materials, are excluded from the definition of industry. I do not accept that you can interpret the definition of "industrial activity" by reference to categories excluded from the definition of "industry". If the proposed development fell within the excluded categories, the definition of "industrial activity" would not be relevant. There is nothing in the wording of the "industrial activity" definition that excludes certain types of products. Further, and contrary to the Edwards' submission, the definition of "industrial activity" does not require there to be a factory or production-line. Instead, the word "production" is sufficiently broad to include the proposed activities on the site, described above at [60 ].
Therefore, I consider that the proposed development is a building or place that is used to carry out an industrial activity. Given that there is no evidence of any impacts on "the amenity of the neighbourhood by reason of noise, vibration, smell, fumes, smoke, vapour, steam, soot, ash, dust, waste water, waste products, grit or oil, or otherwise", the proposed development meets the definition of light industry. Even if the proposed truck movements could be seen to impact "the amenity of the neighbourhood" such that the proposed development is not a light industry, it would fall within the definition of general industry. Both general industry and light industry fall within the defined category of land use called industry, and industries are a nominated prohibited use on the site. The development application therefore seeks consent for a use that is prohibited on the site, and must be refused on that basis.

The applicants' position that it is open to the Court to not approve the filtration system

The Court has the power, pursuant to s 4.16(4) of the EPA Act, to grant consent to the development for which consent was sought, except for "a specified part or aspect of that development". This is the power that would need to be exercised to entertain the offer made on behalf of the applicants that the Court could choose not to approve the Aquamann filtration equipment. However, there are three problems with exercising this power in the manner suggested. The first two create a legal impediment, and the third relates to the facts of the case.
Firstly, Part 4 of the EPA Act only allows a development application to be made for development that may not be carried out except with development consent (ss 4.2, 4.9). Section 4.9 makes it clear that Div 4.3, which contains s 4.16, applies to development that may not be carried out except with development consent. Accordingly, there must be a development application for development that is permissible with development consent before the power in s 4.16(4) can be exercised to grant total or partial consent (see Pet Carriers at [5], [31]), and a development application for a prohibited development is not an application in terms of the EPA Act (see Chambers v Maclean Shire Council & 2 Ors [2003] NSWCA 100; (2003) 57 NSWLR 152; (2003) 126 LGERA 7 at [37], [38]). As stated by Preston CJ of LEC in Forgall Pty Ltd v Greater Taree City Council [2015] NSWLEC 61, "[t]here is no power to grant consent to a development application for prohibited development".
In circumstances where I have found that the Aquamann filtration equipment forms part of a proposed system on the site which is for the purpose of an industry, which is a purpose that is prohibited under the applicable environmental planning instrument, the application is not a development application in terms of Div 4.3 of the EPA Act and s 4.16 is not engaged to allow the Court to determine the development application either at all or in the manner suggested by the applicants.
Secondly, the Court has no power to consider a development application that is not the subject of the appeal (see Ku-ring-gai Council v Bunnings Properties [2019] NSWCA 28; (2019) 236 LGERA 35; Pty Ltd [2019] NSWCA 28 at [202]). The application, at present, is for development that is prohibited and is therefore not a development application for the purpose of Div 4.3 of the EPA Act. I have found that all of the proposed buildings and activities proposed in the application are directed to that prohibited purpose, including the filtration of water as it is pumped to the proposed storage tank system from the existing tank (see [49 ]-[60 ]). Even if it could be established that the removal of the filtration equipment renders the purpose of the development one that is a use that is permissible with consent, the filtration equipment cannot be severed from the proposed development to consider an alternative, hypothetical development application that is not before the Court.
Thirdly, as set out above at [51 ], I have found that, even if I was to consider the total capacity of all the storage tanks, any such storage is nonetheless so brief that it is subordinate to the purpose served by the system as a whole. Therefore, even if all the storage tanks are considered as one, without reference to the need for the water to pass through the filtration equipment, there is no change to my finding that the purpose served by the system as a whole is not a water storage facility.
For those reasons, there is no legal or factual basis upon which I can exercise the power in s 4.16(4) of the EPA Act to grant a partial consent in which I grant consent to the development, except for the Aquamann filtration system.
As I have determined that the proper characterisation of the proposed development is for a use that is prohibited in the C3 zone in which the site is located, there is no power to grant development consent and the development application must be refused on that basis.

The Council raised a number of additional contentions concerning traffic safety, including a contention that two vehicles of the size utilised by the development cannot safely pass one another on Canyonleigh Road due to the road width, and a contention that the sight distance to the east for a vehicle leaving the driveway is inadequate. Given my finding above that the development application must be refused, I need not consider those contentions. However, I ought to make two brief observations.
Firstly, the potential conflict arising from the two-way passing of vehicles on Canyonleigh Road (leaving aside the fact that the narrow width arises due to the Council not building the road in accordance with the Austroads Guide to Road Design) is completely avoided by the proposal for truck movements to be in accordance with the Heavy Vehicle Access Plan. Such a plan would be enforceable through a condition of consent. It can be assumed that a person benefitting from the consent will observe the conditions imposed on that consent (TL & TL Tradings Pty Ltd v City of Parramatta Council [2019] NSWLEC 160 at [13]).
Secondly, with respect to sightlines from the driveway of the development, it is evident that the proposed development complies with the sightlines required by Clause 3.4.5 of AS 2890.2:2018 for a 5s gap. The circumstances requiring a sightline for "up to an 8s gap" do not arise. The AS 2890.2:2018 is the current Australian Standard for off-street commercial vehicle facilities, including design requirements for access driveways for commercial vehicles across the property boundary. It is directly relevant to the driveway the subject of the proposed development. The AS 2890.1:2004, which was variously referred to by the Council and Mr McCarthy, is instead for parking facilities for "motor cars, light vans and motorcycles". It is not appropriate for the Court to set aside or disregard a relevant and scientifically credible standard developed by industry experts, such as the AS 2890.2:2018, and it is not the role of the Court to pioneer standards of its own in reliance on an individual expert or otherwise: Telstra Corporation Limited v Hornsby Shire Council [2006] NSWLEC 133; (2006) 146 LGERA 10; (2006) 67 NSWLR 256 at [98]- [99]; Icon Hospitality Group Pty Ltd v Council of the City of Sydney [2010] NSWLEC 1186 at [32]; and McClelland v Wollongong City Council [2011] NSWLEC 1138 at [47]- [48].
However, it is unnecessary to make any final determination on these contentions given the above finding that the development application must be refused on the basis that the proper characterisation of the proposed development is not for a water storage facility, but is for a use that is prohibited on the site.

(1) The appeal is dismissed.

(2) The development application DA22/0800 for carrying out of works and use of the site at Lot 1 DP 867173 and Lot 152 DP 751284 for the extraction, piping, filtration, storage and transport of groundwater is determined by refusal.

(3) Exhibits B, C and 1-5 are returned, and exhibit A is retained.

Planning and Assessment Act 1979

(2013) 201 LGERA 116

(2007) 151 LGERA 400

(2019) 101 NSWLR 245

(2019) 238 LGERA 147

(2011) 185 LGERA 148

(2004) 136 LGERA 349

At a glance

Court

Decision date

Catchwords

Source

Catchwords

Judgment (57 paragraphs)

Parties

Legislation Cited (1)

Cases Cited (28)