Fagin v Australian Leisure and Hospitality Group Pty Limited

Court of Appeal (NSW)|2018-04-11|Before: McColl JA, Meagher JA, Robson J

[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.] HEADNOTE [This headnote is not to be read as part of the judgment] The appellant (plaintiff) sought orders remedying the respondent's (a hotel operator) alleged failure to comply with a condition of a development consent granted in 2006 (the 2006 Consent) which prohibited the playing of music in the beer garden of the hotel. The subject matter of that consent was "Internal alterations, enclosure of rear patio, awning over patio and part of beer garden and use of beer garden". The respondent contended the consent had lapsed by Environmental Planning and Assessment Act 1979 (NSW) (EPA Act), s 95(1). EPA Act, s 95(4) provided that development consent for the erection of a building, the subdivision of land or the carrying out of a work "does not lapse if building, engineering or construction work relating to the building, subdivision or work is physically commenced on the land to which the consent applies" before the consent would otherwise lapse. EPA Act, s 95(5) provided that development consent "for development other than that referred to in subsection (4) does not lapse if the use of any land, building or work the subject of that consent is actually commenced" before the consent would otherwise lapse. The issues before the primary judge (Robson J) which arose in the appeal were: (1) Whether certain construction works undertaken in the beer garden before the 2006 Consent was granted prevented its lapse by EPA Act, s 95(4); (2) Whether the "use" of the beer garden as such after 2006 prevented the lapse of that consent by EPA Act, s 95(5); (3) On the assumption that the 2006 Consent was operative, whether a later consent (the 2016 Consent) sufficiently regulated noise emitted from the hotel, justifying the Court declining any injunctive relief. The primary judge found against the appellant on each of these issues. The Court (McColl and Meagher JJA, Sackville AJA) dismissed the appeal: In relation to issue (1):

The issues in the underlying proceedings

The appellant (Ms Fagin) appeals from a decision of the primary judge (Robson J) dismissing her application for orders under Environmental Planning and Assessment Act 1979 (NSW) (EPA Act), s 124: Sally-Anne Maree Fagin v Australian Leisure and Hospitality Group Pty Limited [2017] NSWLEC 59. Those orders were sought to remedy two alleged breaches of EPA Act, s 76A(1) by the respondent (Australian Leisure) as operator of the Charles Hotel at Princes Highway, Fairy Meadow.
The first was an alleged failure to comply with condition 17 of Wollongong City Council's Development Consent DA-2006/918 (the 2006 Consent). The subject matter of that consent was "Internal alterations, enclosure of rear patio, awning over patio and part of beer garden and use of beer garden"; and condition 17 "Noise Control" provided "No live or recorded music or amplified sound is permitted within the beer garden". The second was the erection of a "video screen and audio speakers" in the beer garden "without Development Approval", which was said to have been required.
The appellant sought the following relief as remedying those alleged breaches: 1. An order that the Defendant be ordered to comply with the terms of section 17 of Development Consent DA-2006/918 and cease playing live and recorded music in the outdoor beer garden of the Charles Hotel, 92-96 Princes Hwy Fairy Meadow. 2. An order that the Defendant remove the large video screen and audio speakers erected on the outside wall of the hotel in the beer garden which were erected without Development Approval from Wollongong council.
The respondent contested the claim to that relief on three bases. First, it contended there was no breach of condition 17 because the 2006 Consent never applied, having lapsed on 14 November 2011. Secondly, it denied that there was any requirement for development approval for the installation in 2013 of the audio speakers. It was not necessary to consider whether that was also so in relation to the video screen because it had been removed. Thirdly, the respondent contended that even if those breaches were established, in the exercise of its discretion the Court would not grant the relief sought because the noise emissions from the hotel were regulated by and complied with a condition imposed under a later development consent.
Thus the principal question was whether the 2006 Consent had lapsed in November 2011 in accordance with EPA Act, s 95(1). The appellant maintained that it had not because of the application of ss 95(4) or (5).
The appellant contended that the development consent had not lapsed for three reasons, two of which relied on the operation of s 95(4). One of those reasons - the installation of planter boxes in the beer garden after November 2006 - was rejected by the primary judge and is not pressed on appeal. The other was the undertaking of work - the laying of a concrete slab and the construction of perimeter walls of the beer garden - before the 2006 Consent was granted. The third, relying on the operation of s 95(5), was that the development consented to included the "use" of "land" - as the beer garden - and that use "actually commenced" before the consent would otherwise have lapsed in November 2011.
There were three remaining issues between the parties. The first was whether the installation of the audio speakers did not require development consent because that was an "exempt development" within EPA Act, s 76(2). This question, although not decided by the primary judge, is not pressed on appeal. The second was whether the use of those speakers was regulated by the development consent issued by the Council on 17 February 2016 for "commercial - alterations and additions to existing Charles Hotel" (the 2016 Consent). The third was whether, in the exercise of its discretion under s 124(1), the Court should decline any relief in circumstances where the uncontradicted evidence (that of Dr Renzo Tonin, an acoustic engineer) was that the noise level emitted from the hotel premises complied with the NSW Independent Liquor and Gaming Authority (ILGA) criteria for noise control imposed by condition 20 of the 2016 Consent.

The decision of the primary judge

The primary judge held that the 2006 Consent had lapsed with the result that there was never any breach of condition 17. The work undertaken prior to the 2006 Consent was not "work relating to" that consent within s 95(4): Judgment [23]-[29]. The planter boxes were not "wholly reflective of those … provided for in the approved plans" and were not constructed in accordance with the conditions of the 2006 Consent: Judgment [30]-[31]. Finally, the "use" of the existing beer garden, as distinct from the use of the works which were the subject of the 2006 Consent (works that were never undertaken), did not prevent the lapse of that consent. The absence of an occupation certificate as required by condition 5 of the 2006 Consent confirmed that no use of the beer garden was "actually commenced" pursuant to that consent: Judgment [32]-[34].
His Honour did not determine whether the audio speakers were an "exempt development", the appellant not having raised any argument in support of claimed order 2 other than that the continuing use of the speakers was in breach of condition 17 of the 2006 Consent: Judgment [40]. In relation to the exercise of any discretion under s 124, the primary judge indicated, in relation to order 2 as sought, that he would not have made any order restraining the use of those speakers, the video screen having been removed, because that use was "sufficiently regulated" by the 2016 Consent: Judgment [38]-[40].

Grounds of appeal

The amended notice of appeal, filed when the appellant was unrepresented, has eight grounds of appeal. At the hearing, the appellant was ably represented by Ms Kaur-Bains and Ms Madgwick who confirmed, as was stated in the appellant's written submissions in reply, that grounds 3, 5, 6 and 7 were not pressed. That remained the position in oral argument. It should also be recorded that shortly after judgment was reserved, the appellant notified the Court that she proposed to file a notice of motion seeking to re-open the argument of the appeal. When no such application had been made by 31 May 2018, the Registrar advised the parties that the Court would proceed to deal with the appeal "on the basis of the written and oral submissions received".
It follows that it is necessary to address grounds 1, 2, 4 and 8 which are that the primary judge erred: 1. In failing to find that the works to raise "the floor level of the beer garden and the laying of the concrete floor of the beer garden" carried out before the 2006 Consent were works within EPA Act, s 95(4) that prevented the 2006 Consent from lapsing (ground 1); 2. In not finding that the use of the beer garden after November 2006 prevented the 2006 Consent from lapsing by the operation of EPA Act, s 95(5) (ground 2); 3. In finding that the use of the audio speakers in the beer garden was regulated by the 2016 Consent; and in failing to find that consent did not authorise the playing of music in the beer garden (ground 4); 4. In determining that if the 2006 Consent had not lapsed, condition 20 of the 2016 Consent sufficiently regulated the noise level emitted from the hotel premises and justified the Court declining to make any order under EPA Act, s 124 for the removal of the audio speakers (ground 8).
It is convenient to deal with these grounds in the order in which they are raised.

Pre 2006 Consent works (ground 1)

EPA Act, s 95 relevantly provided in 2006: 95 Lapsing of consent (1) A development consent lapses 5 years after the date from which it operates. … (4) Development consent for: (a) the erection of a building, or (b) the subdivision of land, or (c) the carrying out of a work, does not lapse if building, engineering or construction work relating to the building, subdivision or work is physically commenced on the land to which the consent applies before the date on which the consent would otherwise lapse under this section. (5) Development consent for development other than that referred to in subsection (4) does not lapse if the use of any land, building or work the subject of that consent is actually commenced before the date on which the consent would otherwise lapse.
The development application which led to the issue of the 2006 Consent was lodged with the Council on 29 June 2006. Well before the grant of that consent on 14 November 2006, works provided for in the plans accompanying the development application - the erection of footings, laying of a concrete slab, raising of the floor level and construction of a ramp and external walls to the proposed beer garden and patio - were commenced and completed. On 18 July 2006, Wollongong City Council wrote to the architects who had lodged the development application, advising that it was unable to give development consent to the proposed works that had already been undertaken and requiring that an application for a building certificate be submitted for those works. That letter emphasised that only "those works that have not been undertaken to date may form part of this Development Application". That building certificate was applied for, and issued on 9 October 2006: Judgment [5] (6) - (13).
Condition 17 of the 2006 Consent is set out in [2] above; and, as has already been noted, the development was described as "Internal alterations, enclosure of rear patio, awning over patio and part of beer garden, and use of beer garden". The approved plans and specifications showed the "existing hotel" as well as the "proposed refurbished beer garden" which included a new awning and new doors and windows providing access to the "existing hotel primarily unaltered". Condition 5 required that a "final Occupation Certificate must be issued by the Principal Certifying Authority prior to occupation or use of the development". Finally, note 8 provided: … this development consent does not approve the construction of the floor and boundary walls of the beer garden at the rear of the hotel. Building Certificate No. BC-2006/221 has been issued in relation to these works.
The primary judge found that the works undertaken before the granting of consent could not answer the description of work "relating to the building, subdivision or work" which was the subject of that consent because it was not in existence at the time the work was undertaken: Judgment [25]. That conclusion was plainly correct and that was so notwithstanding that it was necessary to have completed those earlier works before the works which were the subject of the consent could be undertaken.
As this Court observed in K and M Prodanovski Pty Ltd v Wollongong City Council [2013] NSWCA 202; (2013) 195 LGERA 23 at [15] (Meagher JA, Leeming JA and Sackville AJA agreeing): In s 95(4) "relating to" is used to distinguish between work which is to be taken to constitute the commencement of a development, so as to prevent the relevant consent from otherwise lapsing, and work which is not to be so taken. The development is defined and described by the instrument constituting the consent, which ordinarily includes conditions imposed under s 80A of the EPA Act. Those conditions may specify or regulate the manner and sequence of performance of the development. If work is undertaken as part of a development, such as the erection of a building or the subdivision of land, but is not undertaken in accordance with the consent, it will not "relate to" the development to which consent has been given. That is so notwithstanding that the work would have to be performed to erect the building or complete the subdivision.
In order for work relevantly to "relate to" a development to which consent has been given, it must be undertaken by the authority of, and in accordance with the consent, including the conditions to which it is subject. As Tobias JA explained in Hunter Development Brokerage Pty Ltd v Cessnock City Council; Tovedale Pty Ltd v Shoalhaven City Council (2005) 63 NSWLR 124; [2005] NSWCA 169 at [104] (a passage cited by the primary judge at Judgment [25]): … the required connection or relationship is satisfied if the relevant work is a necessary step in, or part of, the process required for, or involved in, the erection of the building, the subdivision of the land or the carrying out of the work (as the case may be) which is authorised by the consent. (Emphasis as added by the primary judge)
Perhaps more fundamentally, the work completed before the consent was granted (described in note 8 to the 2006 Consent) could not "relate to" that consent because it was not the subject of, or authorised by, that consent. Ground 1 is misconceived and must be rejected.

Post 2006 Consent use of beer garden (ground 2)

The appellant contends that the 2006 Consent included a consent to "the use of land", consisting of the beer garden area, as a beer garden. EPA Act, s 78A(2) recognised that a single application for development consent could be made in respect of one or more of the types of "development", as defined in s 4(1). That definition included "the use of land" which by the definitions of "land" and "building" extended to the use of parts of a building or any structure or part of a structure. It followed, the appellant submits, that s 95(5) was engaged in respect of that use "development" with the result that the "use" of the beer garden area (as distinct from any "building or work") prevented the 2006 Consent from lapsing. Although the lawfulness or otherwise of the use of the hotel premises and beer garden before the grant of the 2006 Consent could be relevant as a circumstance in which that consent was to be construed, it was not part of the appellant's case that the use of the existing beer garden before November 2006 was unlawful.
The respondent makes the following submissions in response and in support of the primary judge's conclusion. The 2006 Consent must be construed in the light of the principles summarised by Payne JA (McColl and Leeming JJA agreeing) in Bunderra Holdings Pty Ltd v Pasminco Cockle Creek Smelter Pty Ltd (subject to Deed of Company Arrangement) (2017) 96 NSWLR 434; [2017] NSWCA 263 at [158]. In this case, the documents which may be considered, apart from the consent itself, include the plans showing the subject matter of the application to be the "refurbished" rather than existing beer garden, the latter already being used for that purpose. The inclusion of those words as referring to the "refurbished" beer garden is explained by EPA Act, s 81A(1) which provided: 81A Effects of development consents and commencement of development (1) Erection of buildings A development consent that enables the erection of a building is sufficient to authorise the use of the building when erected for the purpose for which it was erected if that purpose is specified in the development application, subject to section 109M.
Here, the development consent enabled the erection of the parts of a "building" or structures described in the 2006 Consent and the specification of the purpose for which they were erected was sufficient for that consent, as distinct from any separate development consent, to authorise their use for that purpose. So understood, the 2006 Consent was a development consent for "the erection of a building" or "the carrying out of a work" within s 95(4)(a) or (c), which authorised the use of that building or work when completed. Accordingly, it could not be a consent for development within s 95(5).
Alternatively, the respondent submits that if the 2006 Consent included consent for the use of any "land, building or work" it was only for the use of the "refurbished" beer garden which would have existed when the work the subject of the consent had been completed. It was common ground that those works were never undertaken. Accordingly, applying the language of s 95(5), no use of the work which was the subject of the development consent commenced before the lapse of that consent.
Under s 95(4), the activity which prevents the development consent from lapsing is the physical commencement of "building, engineering or construction work". Under s 95(5) that activity is the "use of any land, building or work". In each case, there must be a connection between that activity and the subject matter of the consent. Under s 95(4) the work the commencement of which prevents the consent from lapsing is work "relating to" development within paras (a), (b) or (c) or some combination of them. Under s 95(5) the "use" must be "of any land, building or work" that is "the subject" of a consent which, by the qualification in the introductory words to s 95(5), is for development "other than that referred to in" s 95(4).
Thus, it is first necessary to characterise the consent to determine whether it extends beyond consent for the erection of a building, the subdivision of land, or the carrying out of a work. As appears from its terms and the plans referred to in [21] above, the 2006 Consent is directed to the refurbishment of an existing beer garden and identifies the purpose for which that refurbished garden can be used, thereby engaging s 81A(1). It is not directed to authorising the use of the existing beer garden.
For the reasons advanced by the respondent and summarised above, the 2006 Consent is a consent for development wholly within s 95(4)(a) and (c), and accordingly not a consent for development to which s 95(5) applies. For that reason ground 2 must also be rejected.
Reference to the development application for the 2006 Consent would have confirmed that consent was not sought for any change in the use of the land or building, or to the use of the existing beer garden area as such. As is noted by McColl JA in Bunderra Holdings Pty Ltd at [24], Basten JA observed in Cheetham v Goulburn Motorcycle Club Inc [2017] NSWCA 83 at [61] that the "somewhat inflexible" principles which eschew reference, for the purpose of construing a development consent, to any document other than the consent and those documents it incorporates by reference, may require reconsideration. It is not necessary to undertake any such exercise in this case where the position in relation to the scope of the consent is clear.
Nor is it necessary to rely on the primary judge's finding that as at November 2006 the beer garden formed part of the lawful use of the hotel, and was used as such well before that date: Judgment [32]. That conclusion, invoking the presumption of regularity, was part of the context in which the consent was given, and is unassailable. As to the application of that presumption in this context, see Darley Australia Pty Ltd v Walfertan Processors Pty Ltd [2012] NSWCA 48; (2012) 188 LGERA 26 at [113] - [118] (McColl JA, Macfarlan and Whealy JJA agreeing). The relevant evidence is summarised by the primary judge at Judgment [5] (4) and (5). The hotel had been operated at least since 1952 and the beer garden had been used for many years. If the use of that garden had been unlawful, the consent authority might have been expected to respond when each new development application was lodged.

Use of audio speakers and 2016 Consent (ground 4)

The appellant's case before the primary judge was that the audio speakers and video screen had been installed without consent because their installation and use was contrary to condition 17 of the 2006 Consent. That case has been rejected and by the abandoning of ground 3, the appellant does not press her claim that the installation of the speakers required development consent. In this circumstance, the continuing relevance of ground 4, which is directed to whether the use of those speakers is regulated by the 2016 Consent, is not obvious. If the 2016 Consent does not regulate the use of the speakers, as this ground contends, the basis on which the appellant relies on this ground to support the order for their removal is not apparent.
Nevertheless the substance of the appellant's argument may be dealt with briefly. As the appellant points out in her written submissions, the 2016 Consent was in respect of an extension and conversion of a gaming room from indoor to outdoor, the conversion of external doors to louvre doors, and the construction of new bathroom facilities. The works described did not include the installation or use of speakers in the beer garden. For that reason the appellant submits that condition 20 of that consent does not apply. That condition is in the following terms: NSW Independent Liquor and Gaming Authority (ILGA) Criteria for Noise Control NSW Independent Liquor and Gaming Authority (ILGA) Criteria for Noise Control are applicable for the proposal and they are: 20.1 The LA(10) noise level emitted from the licensed premises shall not exceed the background noise level in any Octave Band Frequency (31.5Hz-8kHz inclusive) by more than 5 dB(A) between 7.00 am to midnight at the boundary of any affected residence. 20.2 The LA(10) noise level emitted from the licensed premises shall not exceed the background noise level in any Octave Band Frequency (31.5Hz-8kHz inclusive) between midnight and 7.00 am at the boundary of any affected residence. 20.3 Notwithstanding compliance with the above, the noise from the licensed premises shall not be audible within any habitable room in any residential premises between the hours of midnight and 7.00 am as the development consent permits.
Although the condition provides that the ILGA criteria are applicable "for the proposal", in their terms those criteria fix upper limits for the noise emitted from the licensed premises. It follows that the primary judge did not err in concluding that the use of the audio speakers in the beer garden, to the extent that it involves the emitting of noise, was regulated by condition 20. Ground 4 should be dismissed.

Exercise of discretion under s 124 (ground 8)

This ground does not arise. Nevertheless, addressing this ground on the assumption that the appellant has been successful on grounds 1 or 2, it is not established that the primary judge's exercise of discretion would have miscarried in his declining to make either of the orders sought. Ultimately the relief sought by the appellant was directed to the noise generated from the playing of live and recorded music in the outdoor beer garden of the Hotel. That activity, to the extent that it involves the emission of noise, is regulated by the 2016 Consent which sets maximum volume levels measured at the boundaries of the licensed property. The acoustic engineer's evidence was that the levels of noise emitted from the hotel did not exceed those criteria; and it was not submitted that the criteria were not sufficient to protect any affected neighbouring properties from any significant noise nuisance.

Conclusion

As each of the grounds of appeal pressed by the appellant is rejected, the appeal is dismissed with costs.

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: 16 November 2018

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