Fencott Drive Pty Ltd v Lake Macquarie City Council

However, it is to be noted there is nothing in the recitals to the Deed that is inconsistent with the factual matrix advanced by the Applicant on the basis of the fragmentary documentary evidence.

Another factor that may explain the absence of recitals stating the factual position as now advanced by the Applicant is the fact that it was Scenarama Estates that owned the relevant portion of land which, according to the 1973 agreement, was to be transferred in part to BHP and in part to the Council but Scenarama was not a party to the 1986 Deed.

Despite the difficulties posed by the fragmentary relevant documentary material, I am prepared to find on the balance of probabilities that when lot 1 in Deposited Plan 248860 was created in 1975 and was vested in BHP by the appropriate conveyancing transactions that that lot contained a portion of land that the parties to the tripartite land exchange agreement made in 1973 had intended should be vested in the Council as a dedicated public reserve. I am also prepared to find that from the moment of that vesting in BHP, it held the land subject to some kind of constructive obligation or trust in favour of the Council as the rightful repository of the land as a dedicated public reserve and that this legal position ensued until October 1986 when lot 101 in Deposited Plan 737463 was vested in the Council as a public reserve upon registration of that plan.

Finally, I am prepared to find that the portion of lot 1 in Deposited Plan 238860 that was subject to the constructive trust or obligation was ascertainable in the sense that it was capable of being precisely defined in the manner that lot 101 in Deposited Plan 737463 was ultimately defined or by some similar or alternative process (eg had it become necessary that the question of rectification be litigated, by an appropriate order of the court adjudicating upon the matter).

A final fact that emerges as a consequence of these findings is that the land comprising lot 1 in Deposited Plan 238860 not only comprised an ascertainable parcel of land (that ultimately was ascertained as lot 101 in Deposited Plan 737463) but it also comprised as a separate parcel the residue of lot 1 which was ultimately to become lot 100 in Deposited Plan 737463.

The two questions of law are to be determined in the light of all the foregoing facts (being either facts as agreed or facts as found). I shall consider the questions separately.

C. IS THE DEVELOPMENT SITE THE WHOLE OF AN EXISTING HOLDING?

In contending that the development site is relevantly "an existing holding" within the meaning of cl 13(1) of the LEP, the Applicant submits that it was relevantly a "parcel of land as it was on 21 August 1981" because it was at that time an ascertainable part of lot 1 in Deposited Plan 238860 (the ascertainment in 1986 of its precise existence as lot 100 in Deposited Plan 737463 demonstrating that it was so ascertainable) and as such, constituted a parcel of land, albeit at that time comprising only part of that lot 1.

In so contending, the Applicant, relying upon Ku-Ring-Gai Municipal Council v Kuttner (1980) 41 LGRA1; Christies Sands Pty Ltd v City of Tea Tree Gully (1975) 37 LGRA 325; and Rusell v Brisbane City Council (1955) St R Qd 419 submits that the expression "parcel of land" within the definition of "existing holding" should be interpreted as meaning:

an identified area of land, as in the time-worn expression all that piece or parcel of land : per Hope JA in Kuttner at 3

a specified and reasonably well defined area of land…..defined by general description, by reference to a map or plan, by a clearly established usage, or by a combination of all three (or one or two of them): per Wells J in Christies Sands at 336

a piece of land that can be distinguished from adjoining pieces or areas….: per Macrossan CJ in Russell at 435.

Assuming the correctness of the premise of the Applicant's argument that it is legally and factually possible for a parcel of land to be included within the area of an existing lot or portion, nonetheless in my judgment the Applicant's contention fails because as at the relevant date (21 August 1981) the suggested parcel " as it (then) was " lacked the necessary degree of precise delineation or description to so qualify it as a parcel of land.

As at that date, the only fact, condition or circumstance that gave the parcel any sense of a separate identity or, more fundamentally even a separate existence, was the imperfectly executed 1973 tripartite land exchange agreement and the constructive trust or obligation impressed upon BHP as the owner of lot 1 in Deposited Plan 238860 in respect of an imprecisely defined or delineated part of that lot.

The fact that subsequent events in 1986 (BHP's Deed and the registration of Deposited Plan 737463) ultimately provided the precise definition and delineation of (i) the public reserve lot to be vested in the Council as a dedicated public reserve and (ii) the residue lot to be retained by BHP, though providing evidence that the two parcels which together comprised lot 1 in Deposited Plan 238860 were "ascertainable", does not provide the necessary credential or criterion for the precise delineation or description of the lots as they were as at the relevant date in 1981.

In other words, the events of 1986 which resulted in the lots coming into existence as separate lots (100 and 101) in Deposited Plan 737463 cannot be simply transposed or related back (either notionally or otherwise) to the crucial date in 1981 for the purpose of the statutory term "existing holding" appearing in cl 13(1) of the LEP.

Even if, contrary to what I have held, it were possible to be satisfied of the requisite precise description or delineation of the lots as at the relevant date in 1981, so that there were in existence at that date, two separate parcels (which ultimately were to become lots 100 and 101 in Deposited Plan 737463) the Applicant's contention that the development site by itself relevantly constituted an "existing holding" would, in my judgment nevertheless fail because in such circumstances cl 13(1)(b) would apply to require the aggregation of those two parcels so as to comprise a single "existing holding".

The Applicant sought to resist this result by arguing that the reference in cl 13(1)(b) to "ownership" of two or more adjoining or adjacent parcels meant "beneficial ownership" and that since BHP's ownership of the parcel that ultimately was vested in the Council as a dedicated public reserve was impressed with the constructive trust or obligation in favour of the Council, BHP did not relevantly own that parcel, rather the Council did.

In my judgment, the reference, in cl 13(1)(b) to "ownership" is not limited to beneficial ownership. The term "own" is not defined in the LEP. However, the term "owner" is defined in the EP&A Act as relevantly having the same meaning as in the Local Government Act 1993. In the Dictionary to the Local Government act 1993 "owner" relevantly is defined as follows:

…………… (b) in relation to land other than Crown Land includes: (i) every person who jointly or severally, whether at law or in equity, is entitled to the land for any estate of freehold in possession;

This meaning is relevant to the expression in cl 13(1)(b) of the LEP " where…a person owned two or more adjoining or adjacent lots…. " by virtue of the combined operation of the Interpretation Act 1987 , s 7 and s 10 , there being nothing in the context or subject matter that would indicate or require " otherwise ": vide the Interpretation Act s 6 .

Based upon my factual findings, it follows, in my judgment, that on 21 August 1981 BHP "owned 2….adjoining…parcels of land…" within the meaning of cl 13(1)(b) of the LEP, it not being relevant to that ultimate conclusion that one parcel was so owned beneficially and the other only "legally" (ie not beneficially).

It further follows that the development site does not qualify as an "existing holding" within the meaning of cl 13(1) of the LEP.

Accordingly, it must be concluded that the development site is not "an existing holding" within the meaning of cl 13(1) of the LEP because either (i) it did not exist as at 21 August 1981 as a "parcel of land"; or (ii) if it did so exist, it was owned by the same person who also owned an adjoining lot as at that date and hence, it is the aggregation of the lots which relevantly comprised the "existing holding".

D. DOES CLAUSE 13(2) OR CL 13(3) OF THE LEP IMPOSE A DEVELOPMENT STANDARD IN RESPECT OF SPECIFYING THE MINIMUM AREA OF AN ALLOTMENT UPON WHICH A DWELLING-HOUSE MAY BE ERECTED?

The Applicant submits that cl 13(2)(a) of the LEP imposes a development standard as that term is defined by the EP&A Act s 4(1), namely "development standards" means:

development standards means provisions of an environmental planning instrument or the regulations in relation to the carrying out of development, being provisions by or under which requirements are specified or standards are fixed in respect of any aspect of that development, including, but without limiting the generality of the foregoing, requirements or standards in respect of: (a) the area, shape or frontage of any land, the dimensions of any land, buildings or works, or the distance of any land, building or work from any specified point, (b) the proportion or percentage of the area of a site which a building or work may occupy, (c) the character, location, siting, bulk, scale, shape, size, height, density, design or external appearance of a building or work, (d) the cubic content or floor space of a building, (e) the intensity or density of the use of any land, building or work,

Relying upon the decision of the Court of Appeal in Bell v Shellharbour Municipal Council (1993) 78 LGERA 419, the Applicant submitted that " whether a particular clause in a local environmental planning instrument has the effect of regulating or prohibiting development is a matter of construction ".

The Applicant, after citing familiar passages from the judgment of Holland J in Kruf v Warringah Shire Council (unreported Land and Environment Court 25 December 1988) and North Sydney Municipal Council v P D Mayoh Pty Limited (No 2) (1990) 71 LGRA 222, submitted that cl 13(2)(a) of the LEP "is not saying that there shall be no development for the purposes of a dwelling-house on land within the subject zone, but rather that there may be such development within the zone if it complies with a requirement or standard, namely a requirement or standard in respect of "the area of any land", and arguably also in respect of "the intensity or density of the use of any land".

Finally, the Applicant's argument submits that cl 13(2)(a) of the LEP was "relevantly indistinguishable from the (statutory) clause considered by Talbot J in Pancho Properties Pty Ltd v Wingecarribee Shire Council" (unreported 29 October 1999) which was held to be a development standard.

The Council's competing argument was that cl 13(2), (3) and (4) of the LEP each contained prohibitions on development which "lay down preconditions or facts which must be established before the power to grant consent can be exercised".

In support of this ultimate submission, the Council's detailed argument analysed cl 13 of the LEP as establishing pre-conditions to the power conferred upon the consent authority to grant consent to the erection of a dwelling-house. The argument then essayed an analysis of the many decided cases in this area of the law before propounding the following thesis "to explain the seemingly diverse decisions of the Land and Environment Court and the Court of Appeal":

This basic distinction, between provisions which establish preconditions or facts which must exist in order for the power to grant consent to a development to be able to be exercised and provisions which specify requirements or fix standards in respect of an aspect of permissible development, is fundamental to an understanding of the concept of a development standard.

After surveying many of the decided cases, the Council's argument finally encounters the decision of Talbot J in Pancho Properties submitting that it " stands against this consistent trend of authority ", and that the decision of Lloyd J in Dixson v Wingecarribee Shire Council (1999) 103 LGERA 103 (which Talbot J in Pancho declined to follow because he was " convinced that it was wrong ") was " more likely to be correct ".

In Dixson which involved the same statutory provisions that were considered in Pancho, Lloyd J, applying the reasoning of the judgment of Mahoney JA in North Sydney Council v P D Mayoh Pty Ltd (No 2) (1990 71 LGRA 222, held that the statutory provisions "lay down absolute prohibitions against the development of certain land within certain zones….": see par 32 at p 111.

It is of some interest to note that the successful party in Dixson had based its argument upon the same thesis that the Council in the present case has advanced (see at par 24 at 109). However, Lloyd J's decision does not suggest any acceptance (express or implied) of that argument. Moreover, the "condition precedent" argument (if I may compendiously so refer to it) is directly contrary to the decision in the Court of Appeal in Bell.

If the question were to be determined without reference to the decided cases, I would have no hesitation in holding as a matter of construction that both cl 13(2)(a) and cl 13(3)(a) of the LEP is relevantly a "development standard" in that each is - (i.) a provision of an environmental planning instrument (namely the LEP); (ii.) in relation to the carrying out of a permissible purpose of development (namely a dwelling-house on land within Zone No 1(a)); (iii.) by which requirements are specified or standards are fixed in respect of an aspect of that development (namely "the area of the land" upon which a dwelling-house may be erected).

In so construing, cl 13(2)(a) and cl 13(3)(a) of the LEP, I would respectfully adopt the construction contended by the Applicant in preference to that contended by the Council. With respect, I am wholly unpersuaded by the Council's "condition precedent" argument. In so concluding, I do not think it necessary to separately consider subclause (2) and (3) since they are clearly intended to operate in a mutually complementary manner.

In particular, I would place emphasis on the fact that cl 10 of the LEP has the undisputed effect of including "dwelling-house" development as one "of the purposes" which may be carried out in Zone No 1(a) "only with development consent". It is true that cl 10 is expressed to operate "except as otherwise provided by this plan". In this respect, cl 13 of the LEP (contained in a separate Part III "Special Provisions") obviously has some qualifying effect. However, it is important to note the limits of this qualifying effect. Most obviously, it is to be noted that cl 13 is dealing with the subject of dwelling-house development "on an allotment of land within" Zone No 1(a) whereas cl 10 is designating, inter alia, permissible "purposes of development" within the designated zones (where such purposes include in Zone No 1(a) "dwelling house" purposes).

The obvious and natural construction of the interplay of those two clauses is that cl 10 designates "dwelling-house" development as a permissible purpose of development within Zone No 1(a) and cl 13 specifies a requirement in respect of the minimum size or area of the allotment of land within such zone upon which the permissible dwelling-house purpose may be carried with development consent. In other words, cl 10 declares dwelling-houses to be a permissible purpose of development in Zone 1(a) and cl 13 specifies the minimum size of the allotment, upon which that permissible purpose of development may be carried out. Most importantly, the specification contained in cl 13 does not operate so as to disqualify "dwelling-house" purposes from being a "permissible purpose" of development within the Zone. In other words, cl 13 operates in a complementary manner to cl 10 by specifying the required minimum size or area of an allotment of land within the zone upon which a dwelling-house, being a permissible purpose of development declared by cl 10, may be erected. So understood, cl 13 does not prohibit what cl 10 permits. Rather, it specifies a requirement in respect of an aspect of a permissible purpose of development (namely a dwelling-house) within Zone No 1(a), namely the minimum area or size of an allotment (situate within that zone) upon which that permissible purpose of development may be carried out with development consent.

It is important to note the nature and function in the scheme of the EP&A Act of a "requirement" specified, or a "standard" fixed, by a development standard.

Firstly, the "imposition" of a development standard in an environmental planning instrument is a means of "controlling development": s 26(1)(b) where the Act defines in a very comprehensive manner the terms "control" and "development" (s 4(1)).

But for the existence of the dispensational power conferred by SEPP No 1, any such "requirement" specified or "standard" fixed, must be obeyed - vide: s 76(1), 76A(1) and s 122 - s 125 (inclusive) - not only by all persons wishing to carry out development, but by consent authorities in determining any development application to carry out development.

The dispensational power conferred by SEPP No 1, applies in terms (vide cl 6) to cases "where development could, but for any development standard, be carried out under the Act" and where the dispensational power is exercised, it empowers the grant of development consent "notwithstanding the development standard". It is thus clear beyond argument, that a development standard which is not relaxed by dispensation granted under SEPP No 1, prohibits the carrying out of development.

It is also to be noted, the SEPP No 1 "prevails over any inconsistency between it and any other environmental planning instrument whenever made": vide cl 5. This can only mean that a development standard in force under an environmental planning instrument would prohibit the carrying out of the development, but for the operation of SEPP No 1, which prevails in the case of inconsistency with other planning instruments.

Having regard to the nature and function of a development standard, (and more particularly the nature and function of the "requirements" specified, or the "standards" fixed, by a development standard), it may readily be appreciated that there are overwhelming inherent limitations both in the validity and utility of resorting (as do many of the decided cases) to the dichotomy of "prohibition v regulation" in the task of determining , as a matter of construction, whether or not a particular provision of an environmental planning instrument is a development standard.

This is a crucial matter to appreciate in the task of construction, to which I recently drew attention in Bowen v Willoughby City Council [2000] NSWLEC 69. In the present case, I have gone further in my exposition of this crucial matter.

Another matter of general importance to be noted is the fact that SEPP No 1 has been in force virtually throughout the entire life of the EP&A Act (the Act commenced on 1 September 1980 and SEPP No 1 commenced on 17 October 1980: vide Government Gazette No 152). This fact gives rise to the practical consequence that it has been necessary in cases involving SEPP No 1 to interpret the relevant provisions contained in the environmental planning instrument made under the EP&A Act in the light of the prevailing force given to SEPP No 1 by cl 5 in the case of inconsistency with any environment planning instrument whenever made.

However, I think there is a more significant implication of this fact. Although SEPP No 1 adopts the meaning of "development standards" contained in the EP&A Act and cannot, in any event, expand the concept as so defined in the Act, the construction of planning controls contained in environmental planning instruments may, in my judgment, legitimately reflect the legislative awareness of the existence of the dispensational power conferred by SEPP No 1 in respect of such controls operating by virtue of development standards, and, I would add, in respect of such controls which are reasonably capable (by dint of the process of statutory construction) of so operating. In this respect, I think the task of determining whether a particular provision of an environmental planning instrument is a "development standard" calls for a purposive and beneficial construction which recognises the beneficial purpose of SEPP No 1 as expressly declared in cl 3:

This Policy provides flexibility in the application of planning controls operating by virtue of development standards in circumstances where strict compliance with those standards would, in any particular case, be unreasonable or unnecessary or tend to hinder the attainment of the objects specified in section 5(a)(i) and (ii) of the Act.

It is now necessary for me to consider whether the foregoing opinions and my exposition of relevant principles that have been undertaken without reference to the decided cases are nevertheless consistent with the relevant case law, at least to the extent that it provides either binding authority or definitive guidance.

As I would respectfully understand the relevant decisions of the Court of Appeal, I am of the opinion that what I have said is entirely supported by the decision of the Court of Appeal in Bell v Shellharbour Municipal Council (1993) 78LGERA 429. In my respectful opinion, it is that decision (which is the latest decision of that Court which has fully considered the question of what provisions of an environmental planning instrument are development standards) that provides the most definitive guidance as to how the task of construction is to be undertaken in the present context.

That decision, although not referred to in the later Court of Appeal decisions in Healesville Holdings Pty Ltd v Pittwater Council (1997) 97LGERA 95 and in Fast Buck$ v Byron Shire Council (1999) 103 LGERA 94, is consistent with the concession made by the Council in Healesville (where the Court considered it unnecessary to decide whether the concession was well founded) and is entirely consistent with the decision in Fast Buck$ (which is the most recent occasion that the Court of Appeal has considered the operation of SEPP No 1, but without directly addressing the question whether a development standard was involved, that fact simply being assumed.)

For present purposes, it will be sufficient if I repeat the analysis of Bell which I made in the following passages in Bowen v Willoughby Council:

In Bell , Cripps JA, in holding the concession that the relevant statutory provisions constituted development standards to be correctly made , considers the decided cases in the following passage at 432/433 in a manner that I would respectfully adopt:

In the course of argument, reference was made by both counsel to a number of decisions dealing with certain clauses in planning instruments and the amenability of those clauses to the dispensing power in State Environmental Planning Policy No 1 : see North Sydney Municipal Council v P D Mayoh Pty Ltd [No 2] (1990) 71 LGRA 222, Quinn O'Hanlon Architects Pty Ltd v Leichhardt Municipal Council (1989) 68 LGRA 114 , Kruf v Warringah Shire Council (Land and Environment Court of New South Wales, 15 December 1988, unreported), Napper v Shoalhaven City Council (Land and Environment Court of New South Wales, 26 February 1988, unreported), Ford Mirvac Developments Pty Ltd v Blacktown City Council (Land and Environment Court of New South Wales, 3 April 1990, unreported), Challister Ltd v Blacktown City Council (1992) 76 LGRA 10 and Nooramunga Holdings Pty Ltd v Shoalhaven City Council (Land and Environment Court of New South Wales, 7 February 1991, unreported). I trust I do no disservice to the arguments presented when I say it is unnecessary in this appeal to deal with these cases. There is, self-evidently, a difference between a clause absolutely prohibiting development on the one hand and a clause regulating development by specifying requirements or fixing standards on the other. Whether a particular clause in a local environmental planning instrument has the effect of regulating or prohibiting development is a matter of construction. In some of the cases the Court has held that the relevant clause was an absolute prohibition - in others it was held that the clause was regulatory. But, as was pointed out in Mayoh , the obligation of the Court is to interpret the clause in the instrument before it.

It is of more than passing interest to note the relevant statutory provisions considered in Bell in the light of the relevant facts of that case. The proposed development involved the subdivision of a parcel of land some 18 ha in area into two lots, one of 2 ha and the other of 16 ha, where both proposed lots would contain areas far less than the prescribed minimum area (40 ha ) and one of the lots would contain a frontage to the highway far less than the prescribed minimum frontage.

Relevantly, the statutory provisions contained in the Shellharbour Local Environmental Plan were to forbid the subdivision of land without development consent (cl 15) and cl 16(2)) which applied to the subject land confined the power to so consent, by providing as follows:

(2) The council shall not consent to the subdivision of land to which this clause applies unless each allotment of land to be created by the subdivision will have - (a) an area of not less than 40 hectares; and (b) where the allotment has frontage to a main road - a frontage of not less than 200 metres.

Accordingly, the combined effect of the relevant statutory provisions was that subdivision of land required development consent, but that the council was forbidden from granting consent to a subdivision unless each proposed lot had a minimum area of 40 ha and where the lot had frontage to a main road, had a minimum frontage of 200 m.

Applying those provisions to the relevant facts of the case, it would be an unexceptional deduction to say that the proposed subdivision was prohibited development because each of the lots proposed to be created contained an area far less than the prescribed minimum area. Indeed logically it could be deduced, again unexceptionally, that the relevant land was legally incapable of subdivision for the intended purposes because it simply lacked the requisite area to be subdivided in accordance with the relevant statutory provisions.

Nonetheless, the Court held that the statutory provisions relevantly constituted development standards because cl 16(2) contained provisions specifying requirements or fixing standards in respect of an aspect of the proposed development: at 431.

Bell, in my respectful opinion, sounds an important cautionary note against an oversimplistic or excessive reliance in this field of jurisprudence, upon the dichotomy of prohibition and regulation as providing the interpretive solvent to whether a particular statutory provision is, or is not, relevantly a development standard.

Although the later decision of the Court of Appeal in Healesville appears to have adopted a more cautious approach as to whether a very similar statutory provision (albeit in an urban setting) operated as a development standard (inasmuch as Priestley JA who gave the leading judgment considered it unnecessary to consider whether the concession that a development standard was involved, was well founded) the Court's attention does not appear to have been directed to the decision in Bell. Rather, the argument directed attention to the earlier decisions in Vaniga and P D Mayoh.

However, in the still later decision of the Court of Appeal in Fast Buck$ v Byron Shire Council (1999) 103 LGERA 94 where the relevant statutory provisions and relevant facts were not materially different from those in Bell, the Court of Appeal proceeded on the basis that the statutory provision was relevantly a development standard amenable to the dispensational power conferred by SEPP No 1.

It is not necessary in the present case to completely explore the ramifications of the Court of Appeal's decision in Bell for the conventional dichotomy of prohibiting and regulating controls on development other than to make two observations. Firstly, it appears too late in the day to say that the dichotomy serves no useful purpose. Clearly, it is an apt descriptor of the interpretive result in cases as to whether provisions are or are not, development standards. Secondly, that a development standard may involve prohibition was recognised as long ago as 1985 when Carr was decided: see at 269 per McHugh JA (as he then was). Even in P D Mayoh, which appears to be the high water mark of the influence of the dichotomy, Clarke JA recognised at 238 that the substantial effect of particular prohibitions….may be to impose a requirement (constituting a development standard).

In the present case, I have delved more deeply into the questionable utility of recourse to the " prohibition v regulation" dichotomy, but only to the extent necessary to resolve the present question of statutory construction, being satisfied that in so doing, my reasoning is entirely supported by the decision in Bell . It may be that the present case is, in any event, entirely answered by application of the decision in Bell . If so, then I have travelled further than needed, in deference to the detailed submissions advanced by the Council and for the purpose of fully explaining my approach to construing cl 13 of the LEP.

For completeness, and because it was expressly referred to in the Council's argument, I should say that the earlier decision of the Court of Appeal in Byron Shire Council v Chrestal Pty Ltd (1983) 49LGRA 88, is entirely consistent with the proposition that the dispensational power conferred by SEPP No 1 was applicable to a provision in the planning instrument which impliedly prohibited the erection of a dwelling-house upon non-urban land not possessing the prescribed minimum size or area.

For all the foregoing reasons, I determine the preliminary questions of law as follows: Question 1 Is the development site an "existing holding" in terms of cl 13(1) of the LEP? Answer: No Question 2 Is cl 13(2)(a) or cl 13(3)(a) of LEP a development standard? Answer: Yes.

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.

50. It is of some interest to note that the successful party in Dixson had based its argument upon the same thesis that the Council in the present case has advanced (see at par 24 at 109). However, Lloyd J's decision does not suggest any acceptance (express or implied) of that argument. Moreover, the "condition precedent" argument (if I may compendiously so refer to it) is directly contrary to the decision in the Court of Appeal in Bell.

51. If the question were to be determined without reference to the decided cases, I would have no hesitation in holding as a matter of construction that both cl 13(2)(a) and cl 13(3)(a) of the LEP is relevantly a "development standard" in that each is--

(i.) a provision of an environmental planning instrument (namely the LEP);

(ii.) in relation to the carrying out of a permissible purpose of development (namely a dwelling-house on land within Zone No 1(a));

(iii.) by which requirements are specified or standards are fixed in respect of an aspect of that development (namely "the area of the land" upon which a dwelling-house may be erected).

52. In so construing, cl 13(2)(a) and cl 13(3)(a) of the LEP, I would respectfully adopt the construction contended by the Applicant in preference to that contended by the Council. With respect, I am wholly unpersuaded by the Council's "condition precedent" argument. In so concluding, I do not think it necessary to separately consider subclause (2) and (3) since they are clearly intended to operate in a mutually complementary manner.

53. In particular, I would place emphasis on the fact that cl 10 of the LEP has the undisputed effect of including "dwelling-house" development as one "of the purposes" which may be carried out in Zone No 1(a) "only with development consent". It is true that cl 10 is expressed to operate "e_xcept as otherwise provided by this plan_". In this respect, cl 13 of the LEP (contained in a separate Part III "Special Provisions") obviously has some qualifying effect. However, it is important to note the limits of this qualifying effect. Most obviously, it is to be noted that cl 13 is dealing with the subject of dwelling-house development "on an allotment of land within" Zone No 1(a) whereas cl 10 is designating, inter alia, permissible "purposes of development" within the designated zones (where such purposes include in Zone No 1(a) "dwelling house" purposes).

54. The obvious and natural construction of the interplay of those two clauses is that cl 10 designates "dwelling-house" development as a permissible purpose of development within Zone No 1(a) and cl 13 specifies a requirement in respect of the minimum size or area of the allotment of land within such zone upon which the permissible dwelling-house purpose may be carried with development consent. In other words, cl 10 declares dwelling-houses to be a permissible purpose of development in Zone 1(a) and cl 13 specifies the minimum size of the allotment, upon which that permissible purpose of development may be carried out. Most importantly, the specification contained in cl 13 does not operate so as to disqualify "dwelling-house" purposes from being a "permissible purpose" of development within the Zone. In other words, cl 13 operates in a complementary manner to cl 10 by specifying the required minimum size or area of an allotment of land within the zone upon which a dwelling-house, being a permissible purpose of development declared by cl 10, may be erected. So understood, cl 13 does not prohibit what cl 10 permits. Rather, it specifies a requirement in respect of an aspect of a permissible purpose of development (namely a dwelling-house) within Zone No 1(a), namely the minimum area or size of an allotment (situate within that zone) upon which that permissible purpose of development may be carried out with development consent.

55. It is important to note the nature and function in the scheme of the EP&A Act of a "requirement" specified, or a "standard" fixed, by a development standard.

56. Firstly, the "imposition" of a development standard in an environmental planning instrument is a means of "controlling development": s 26(1)(b) where the Act defines in a very comprehensive manner the terms "control" and "development" (s 4(1)).

57. But for the existence of the dispensational power conferred by SEPP No 1, any such "requirement" specified or "standard" fixed, must be obeyed--vide: **s 76(1), 76A(1) and s 122 - s 125 (inclusive)--**not only by all persons wishing to carry out development, but by consent authorities in determining any development application to carry out development.

58. The dispensational power conferred by SEPP No 1, applies in terms (vide cl 6) to cases "where development could, but for any development standard, be carried out under the Act" and where the dispensational power is exercised, it empowers the grant of development consent "notwithstanding the development standard". It is thus clear beyond argument, that a development standard which is not relaxed by dispensation granted under SEPP No 1, prohibits the carrying out of development.

59. It is also to be noted, the SEPP No 1 "prevails over any inconsistency between it and any other environmental planning instrument whenever made": vide cl 5. This can only mean that a development standard in force under an environmental planning instrument would prohibit the carrying out of the development, but for the operation of SEPP No 1, which prevails in the case of inconsistency with other planning instruments.

60. Having regard to the nature and function of a development standard, (and more particularly the nature and function of the "requirements" specified, or the "standards" fixed, by a development standard), it may readily be appreciated that there are overwhelming inherent limitations both in the validity and utility of resorting (as do many of the decided cases) to the dichotomy of "prohibition v regulation" in the task of determining , as a matter of construction, whether or not a particular provision of an environmental planning instrument is a development standard.

61. This is a crucial matter to appreciate in the task of construction, to which I recently drew attention in Bowen v Willoughby City Council [2000] NSWLEC 69. In the present case, I have gone further in my exposition of this crucial matter.

62. Another matter of general importance to be noted is the fact that SEPP No 1 has been in force virtually throughout the entire life of the EP&A Act (the Act commenced on 1 September 1980 and SEPP No 1 commenced on 17 October 1980: vide Government Gazette No 152). This fact gives rise to the practical consequence that it has been necessary in cases involving SEPP No 1 to interpret the relevant provisions contained in the environmental planning instrument made under the EP&A Act in the light of the prevailing force given to SEPP No 1 by cl 5 in the case of inconsistency with any environment planning instrument whenever made.

63. However, I think there is a more significant implication of this fact. Although SEPP No 1 adopts the meaning of "development standards" contained in the EP&A Act and cannot, in any event, expand the concept as so defined in the Act, the construction of planning controls contained in environmental planning instruments may, in my judgment, legitimately reflect the legislative awareness of the existence of the dispensational power conferred by SEPP No 1 in respect of such controls operating by virtue of development standards, and, I would add, in respect of such controls which are reasonably capable (by dint of the process of statutory construction) of so operating. In this respect, I think the task of determining whether a particular provision of an environmental planning instrument is a "development standard" calls for a purposive and beneficial construction which recognises the beneficial purpose of SEPP No 1 as expressly declared in cl 3:

This Policy provides flexibility in the application of planning controls operating by virtue of development standards in circumstances where strict compliance with those standards would, in any particular case, be unreasonable or unnecessary or tend to hinder the attainment of the objects specified in section 5(a)(i) and (ii) of the Act.

64. It is now necessary for me to consider whether the foregoing opinions and my exposition of relevant principles that have been undertaken without reference to the decided cases are nevertheless consistent with the relevant case law, at least to the extent that it provides either binding authority or definitive guidance.

65. As I would respectfully understand the relevant decisions of the Court of Appeal, I am of the opinion that what I have said is entirely supported by the decision of the Court of Appeal in Bell v Shellharbour Municipal Council (1993) 78LGERA 429. In my respectful opinion, it is that decision (which is the latest decision of that Court which has fully considered the question of what provisions of an environmental planning instrument are development standards) that provides the most definitive guidance as to how the task of construction is to be undertaken in the present context.

66. That decision, although not referred to in the later Court of Appeal decisions in Healesville Holdings Pty Ltd v Pittwater Council (1997) 97LGERA 95 and in Fast Buck$ v Byron Shire Council [1999] NSWCA 19; (1999) 103 LGERA 94, is consistent with the concession made by the Council in Healesville (where the Court considered it unnecessary to decide whether the concession was well founded) and is entirely consistent with the decision in Fast Buck$ (which is the most recent occasion that the Court of Appeal has considered the operation of SEPP No 1, but without directly addressing the question whether a development standard was involved, that fact simply being assumed.)

67. For present purposes, it will be sufficient if I repeat the analysis of Bell which I made in the following passages in Bowen v Willoughby Council:

In Bell, Cripps JA, in holding the concession that the relevant statutory provisions constituted development standards to be correctly made_, considers the decided cases in the following passage at 432/433 in a manner that I would respectfully adopt:_

In the course of argument, reference was made by both counsel to a number of decisions dealing with certain clauses in planning instruments and the amenability of those clauses to the dispensing power in State Environmental Planning Policy No 1: see North Sydney Municipal Council v P D Mayoh Pty Ltd [No 2] (1990) 71 LGRA 222, Quinn O'Hanlon Architects Pty Ltd v Leichhardt Municipal Council (1989) 68 LGRA 114, Kruf v Warringah Shire Council (Land and Environment Court of New South Wales, 15 December 1988, unreported), Napper v Shoalhaven City Council (Land and Environment Court of New South Wales, 26 February 1988, unreported), Ford Mirvac Developments Pty Ltd v Blacktown City Council (Land and Environment Court of New South Wales, 3 April 1990, unreported), Challister Ltd v Blacktown City Council (1992) 76 LGRA 10 and Nooramunga Holdings Pty Ltd v Shoalhaven City Council (Land and Environment Court of New South Wales, 7 February 1991, unreported). I trust I do no disservice to the arguments presented when I say it is unnecessary in this appeal to deal with these cases. There is, self-evidently, a difference between a clause absolutely prohibiting development on the one hand and a clause regulating development by specifying requirements or fixing standards on the other. Whether a particular clause in a local environmental planning instrument has the effect of regulating or prohibiting development is a matter of construction. In some of the cases the Court has held that the relevant clause was an absolute prohibition -- in others it was held that the clause was regulatory. But, as was pointed out in Mayoh, the obligation of the Court is to interpret the clause in the instrument before it.

It is of more than passing interest to note the relevant statutory provisions considered in Bell in the light of the relevant facts of that case. The proposed development involved the subdivision of a parcel of land some 18 ha in area into two lots, one of 2 ha and the other of 16 ha, where both proposed lots would contain areas far less than the prescribed minimum area (40 ha ) and one of the lots would contain a frontage to the highway far less than the prescribed minimum frontage.

Relevantly, the statutory provisions contained in the Shellharbour Local Environmental Plan were to forbid the subdivision of land without development consent (cl 15) and cl 16(2)) which applied to the subject land confined the power to so consent, by providing as follows:

(2) The council shall not consent to the subdivision of land to which this clause applies unless each allotment of land to be created by the subdivision will have --

(b) where the allotment has frontage to a main road -- a frontage of not less than 200 metres.

Accordingly, the combined effect of the relevant statutory provisions was that subdivision of land required development consent, but that the council was forbidden from granting consent to a subdivision unless each proposed lot had a minimum area of 40 ha and where the lot had frontage to a main road, had a minimum frontage of 200 m.

Applying those provisions to the relevant facts of the case, it would be an unexceptional deduction to say that the proposed subdivision was prohibited development because each of the lots proposed to be created contained an area far less than the prescribed minimum area. Indeed logically it could be deduced, again unexceptionally, that the relevant land was legally incapable of subdivision for the intended purposes because it simply lacked the requisite area to be subdivided in accordance with the relevant statutory provisions.

Nonetheless, the Court held that the statutory provisions relevantly constituted development standards because cl 16(2) contained provisions specifying requirements or fixing standards in respect of an aspect of the proposed development_: at 431._

Bell, in my respectful opinion, sounds an important cautionary note against an oversimplistic or excessive reliance in this field of jurisprudence, upon the dichotomy of prohibition and regulation as providing the interpretive solvent to whether a particular statutory provision is, or is not, relevantly a development standard.

Although the later decision of the Court of Appeal in Healesville appears to have adopted a more cautious approach as to whether a very similar statutory provision (albeit in an urban setting) operated as a development standard (inasmuch as Priestley JA who gave the leading judgment considered it unnecessary to consider whether the concession that a development standard was involved, was well founded) the Court's attention does not appear to have been directed to the decision in Bell. Rather, the argument directed attention to the earlier decisions in Vaniga and P D Mayoh.

However, in the still later decision of the Court of Appeal in Fast Buck$ v Byron Shire Council [1999] NSWCA 19; (1999) 103 LGERA 94 where the relevant statutory provisions and relevant facts were not materially different from those in Bell, the Court of Appeal proceeded on the basis that the statutory provision was relevantly a development standard amenable to the dispensational power conferred by SEPP No 1.

It is not necessary in the present case to completely explore the ramifications of the Court of Appeal's decision in Bell for the conventional dichotomy of prohibiting and regulating controls on development other than to make two observations. Firstly, it appears too late in the day to say that the dichotomy serves no useful purpose. Clearly, it is an apt descriptor of the interpretive result in cases as to whether provisions are or are not, development standards. Secondly, that a development standard may involve prohibition was recognised as long ago as 1985 when Carr was decided: see at 269 per McHugh JA (as he then was). Even in P D Mayoh, which appears to be the high water mark of the influence of the dichotomy, Clarke JA recognised at 238 that the substantial effect of particular prohibitions....may be to impose a requirement (constituting a development standard).

68. In the present case, I have delved more deeply into the questionable utility of recourse to the "prohibition v regulation" dichotomy, but only to the extent necessary to resolve the present question of statutory construction, being satisfied that in so doing, my reasoning is entirely supported by the decision in Bell. It may be that the present case is, in any event, entirely answered by application of the decision in Bell. If so, then I have travelled further than needed, in deference to the detailed submissions advanced by the Council and for the purpose of fully explaining my approach to construing cl 13 of the LEP.

69. For completeness, and because it was expressly referred to in the Council's argument, I should say that the earlier decision of the Court of Appeal in Byron Shire Council v Chrestal Pty Ltd (1983) 49LGRA 88, is entirely consistent with the proposition that the dispensational power conferred by SEPP No 1 was applicable to a provision in the planning instrument which impliedly prohibited the erection of a dwelling-house upon non-urban land not possessing the prescribed minimum size or area.

70. For all the foregoing reasons, I determine the preliminary questions of law as follows:

Is the development site an "existing holding" in terms of cl 13(1) of the LEP?

Is cl 13(2)(a) or cl 13(3)(a) of LEP a development standard?