Four2Five Pty Ltd v Ashfield Council

Commissioner's judgment

1. The Commissioner held at [51]-[52] and [59]-[65] of her judgment: 51 The written request addresses the matters specified in cl 4.6(3)(a) and (b). Clause 4.6(4) provides that consent cannot be granted unless the Court, as consent authority, is satisfied that the written request has adequately addressed the matters required to be demonstrated by subclause (3), and that the proposed development will be in the public interest because it is consistent with the objectives of the particular standard and the objectives for development within the zone in which the development is proposed to be carried out. 52 Clause 4.6(4)(a)(ii) requires consideration of the objectives of the development standard and the zone objectives … … 59 I am satisfied that the proposed development satisfies cl 4.6(4)(a)(ii). Clause 4.6(4)(a)(i) requires that the Court is satisfied that the written request has adequately addressed the matters required to be demonstrated by cl 4.6(3), namely that compliance with the standard is unreasonable or unnecessary in the circumstances of the case, and that there are sufficient environmental planning grounds to justify contravening the development standard. 60 The environmental planning grounds identified in the written request are the public benefits arising from the additional housing and employment opportunities that would be delivered by the development, noting (at p 5) the close proximity to Ashfield railway station, major regional road networks and the Ashfield town centre; access to areas of employment, educational facilities, entertainment and open space; provision of increased employment opportunities through the ground floor retail/business space; and an increase in the available housing stock. I accept that the proposed development would provide those public benefits, however any development for a mixed use development on this site would provide those benefits, as would any similar development on any of the sites on Liverpool Road in the vicinity of the subject site that are also in the B4 zone. These grounds are not particular to the circumstances of this proposed development on this site. To accept a departure from the development standard in that context would not promote the proper and orderly development of land as contemplated by the controls applicable to the B4 zoned land, which is an objective of the Act (s 5(a)(ii)) and which it can be assumed is within the scope of the "environmental planning grounds" referred to in cl 4.6(4)(a)(i) of the LEP. 61 The written request argues that compliance is unnecessary in the circumstances of the case because the proposed development meets the objectives of the standard and the zone objectives, and that insistence on strict compliance would be unreasonable. Achieving the objectives of the development standard notwithstanding non-compliance with the standard was the most commonly invoked way of establishing that compliance with a development standard was "unreasonable or unnecessary in the circumstances of the case" under cl 6 of SEPP 1: Wehbe v Pittwater Council [2007] NSWLEC 827 at [42] per Preston CJ. In Wehbe at [44]-[48] Preston CJ identified other ways in which an applicant might establish that compliance with a development standard is unreasonable or unnecessary, namely that the underlying objective or purpose is not relevant to the development; that the objective would be defeated or thwarted if compliance was required; that the development standard has been virtually abandoned or destroyed by the Council's own actions in departing from the standard; or that the zoning of the land is unreasonable or inappropriate. 62 I agree with the submission of Four2Five that the wording of cl 4.6, being different to that in SEPP 1, requires the decision-maker to be faithful to the language of the clause rather than any stated principles developed in the application of SEPP 1, and that, subject to that caution, the case law developed in relation to the application of SEPP1 may be of assistance in applying cl 4.6. While Wehbe concerned an objection under SEPP 1, in my view the analysis is equally applicable to a variation under cl 4.6 where cl 4.6(3)(a) uses the same language as cl 6 of SEPP1. Consistency with the objectives of the development standard and the zone objectives is now addressed specifically in cl 4.6(4)(a)(ii), with separate attention required to the question of whether compliance is unreasonable or unnecessary, using the same expression as that in cl 6 of SEPP 1, in cl 4.6(3)(a) and 4.6(4)(a)(i) of the LEP. The written request does not identify any of the additional ways of establishing that compliance is unreasonable or unnecessary in the circumstances of the case. … 64 I am not satisfied that the written request has demonstrated that there are sufficient environmental planning grounds to justify contravening the development standard, or that compliance with the height standard is unreasonable or unnecessary in the circumstances of the case, as required by cl 4.6(4)(a)(i), and accordingly the requirements of cl 4.6(4) of the LEP are not met. This conclusion makes it unnecessary to express a concluded view on the application of cl 4.6(5) of the LEP, having regard to the discussion of the equivalent cl 8 of SEPP 1 in Wehbe at [40]-[41], in circumstances where the concurrence of the Director-General is to be assumed (Planning Circular PS 08-003, 9 May 2008, exhibit D). 65 The Council's draft Conditions (exhibit 9) include Condition B(1)(a) and (b) requiring the deletion of level 6 (units 6.01-6.03) from the southern part of the site and level 3 (units 3.06-3.09) from the northern part of the site. Compliance with that condition would achieve compliance with the development standard in cl 4.3(2A). In circumstances where I am not satisfied that cl 4.6 is met, that condition should be imposed so that there would be power to grant consent.
2. The Appellant tendered a bundle of documents that included the amended summons commencing an appeal dated 17 April 2015, the Commissioner's judgment, an amended statement of facts and contentions, and a joint planning report dated 31 October 2014 by Mr Fletcher and Mr North, the Appellant's and Respondent's respective planning experts. The joint planning report incorporated a cl 4.6 variation of development standard request by Mr Fletcher dated 31 October 2014. Also included in the bundle of documents were transcripts of proceedings before the Commissioner, and the LEP.
3. There is no factual dispute between the parties.

Appellant's submissions on grounds 1 and 2

1. Concerning ground 1, a legal error in the Commissioner's reasoning is found in [60] namely that "the environmental planning grounds" referred to in cl 4.6(3)(b) relied upon by an applicant must be particular to the circumstances of the proposed development. Firstly, subclause (3)(b) does not say that. All the clause requires is the demonstration that there are sufficient environmental planning grounds to justify contravening the development standard. No words of limitation or restriction are found in that phraseology. Secondly, the word "sufficient" suggests that the draftsman is setting the bar quite low. Thirdly, the phrase "sufficient environmental planning grounds" is a phrase of extremely wide compass. Fourthly, what the Commissioner has held is to say that the clause properly construed requires identification of "environmental planning grounds particular to the circumstances of the proposed development to justify contravening the development standard". Such language could easily have been deployed by the draftsman if that was the intention.
2. Given that the objective of cl 4.6 includes the provision of an appropriate degree of flexibility in applying certain development standards to particular development the Commissioner's construction of the clause contravenes the objective because it restricts the operation of the clause and renders the application of development standards less flexible in any particular development.
3. There is no common sense in excluding consideration of all or any of the matters identified by Mr Fletcher in his cl 4.6 written request in the determination of whether to allow this building to be higher than is permitted by the development standard in the LEP in the relevant zone.
4. If it is in the public interest that the proposed development be approved because it is consistent with the objectives of the particular standard and the objectives for development within the zone in which the development is proposed to be carried out (cl 4.6(4)(a)(ii)) in the form in which it is proposed, it seems counter-intuitive to find that it is not unreasonable or unnecessary to be forced to comply with the development standard in the circumstances of the case as the Commissioner did. If the proposed development will be in the public interest in the same sense it also seems counter-intuitive that having regard to the matters identified by Mr Fletcher the additional floors should be refused.
5. Concerning ground 2, the Commissioner misconstrued cl 4.6 of the LEP in holding that under cl 4.6(3)(a) it was not open for the Appellant to demonstrate that compliance with the development standard was unreasonable or unnecessary in the circumstances of the case because the development as proposed is consistent with the objectives of the particular standard and the objectives for development within the zone in which the development is proposed to be carried out.
6. The Commissioner misconstrued cl 4.6 so narrowly as to undermine its beneficial or remedial provisions as per D C Pearce and R S Geddes, Statutory Interpretation in Australia, (8th ed 2014, LexisNexis Butterworths) at [9.2]. The clause must be considered as a whole and considered within the context of the LEP of which it forms an important part. Its objectives expressly state the clause provides for an appropriate degree of flexibility in applying development standards to particular development and to achieve better outcomes both for development and from development by allowing flexibility in particular circumstances. Accordingly the objective is to improve outcomes for the development itself (and those that live in, work in or enjoy the development) and from the development for the benefit of the wider environment.
7. An applicant must prepare a written request in which it "seeks" to justify the contravention of the development standard. The meaning of the word "seek" in this context is to "attempt to achieve something''. Clause 4.6(3) does not require an applicant to in fact justify the contravention but merely to seek or attempt to justify the contravention. Development consent must not be granted for development that contravenes a development standard unless the consent authority considers a written request from the developer wherein that attempt to justify the contravention is made. The attempt is made by demonstrating compliance with the development standard is unreasonable or unnecessary in the circumstances of the case and that there are sufficient environmental planning grounds to justify contravening the development standard.
8. There is no reason to construe cl 4.6(4)(a)(i) in a way which means that an applicant for consent cannot seek to justify the contravention of the development standard by demonstrating that compliance with the development standard is unreasonable or unnecessary in the circumstances of the case because the proposed development is consistent with the objectives of the particular standard and/or the objectives for development within the zone in which the development is proposed to be carried out. These are not mutually exclusive criteria. Subclause (3) is directed at an applicant in the first instance, and what the applicant must do. Subclause (4) is directed at the consent authority but only in the sense that it is directed to consider the written request.

Council's submissions on grounds 1 and 2

1. In relation to ground 1, the Commissioner made a finding of fact which cannot be challenged in this 56A appeal. The Commissioner had to be satisfied that the Appellant's application adequately addressed that there were sufficient environmental planning grounds to justify the contravention of a development standard. The required satisfaction under cl 4.6(4)(a) is that the cl 4.6 application for variation has adequately addressed the requirements of subclause (3)(b).
2. In relation to ground 2, cl 4.6(4)(a) requires the consent authority to be satisfied about two matters. The first part of the clause requires the consent authority to be satisfied that the applicant's request has addressed subclause (3)(a) and (b). The second step is for the consent authority to then be satisfied that the proposed development (with the variation of the development standard) will be in the public interest because it is consistent with: 1. the objectives of the particular standard, and 2. the objectives for development within the zone in which the development is proposed to be carried out.
3. This clause requires that the consent authority be satisfied that the development is consistent with the objectives of the particular standard.
4. Applying the Appellant's construction of cl 4.6, if an applicant addresses the unreasonable or unnecessary issue in subclause (3)(a) by demonstrating consistency with the objective of the development standard, then the consent authority would have to be satisfied about this under subclause (4)(a)(i) when consideration is given to whether the applicant's variation does adequately address this issue. If this is the case, when the consent authority moves to consider subclause (4)(a)(ii), there is no work for a substantial part of this clause to do because the consent authority has already considered the objective of the standard under subclause (4)(a)(i).
5. Consequently, the Commissioner correctly identified that consistency with the objectives of the development standard is now addressed specifically in cl 4.6(4)(a)(ii). It follows, as the Commissioner found, that "separate attention" (or additional ways) to consider consistency with the objective of the standard is now required for considering the question of whether compliance with the development standard is unreasonable or unnecessary in the circumstances of the case under subclause (3)(b).

No error in Commissioner's judgment

1. The principles applicable to appeals under s 56A of the Court Act are well understood and have been articulated in many judgments of the Court. Conveniently, they were summarised by Pepper J recently in Norm Fletcher & Associates Pty Limited v Strathfield Municipal Council [2014] NSWLEC 157 at [31]. Of most relevance to this appeal is that such an appeal cannot be a rerun of the merits of the original appeal under s 97 of the Environmental Planning and Assessment Act 1979 (NSW) (EPA Act) but must be directed to a question(s) of law.
2. This appeal requires the construction of cl 4.6 of the LEP. This appears to be a stand-alone provision in the LEP as the parties have not found it necessary to refer to other sections of the LEP, apart from brief reference to cl 1.9 and cl 4.3(2A). Their submissions have been directed to the precise terms of cl 4.6(1)(3) and (4). Clause 4.6 operates exclusively in relation to applications for variation of all development standards including but not limited to those considered formerly under State Environmental Planning Policy No 1 - Development Standards (SEPP 1) as provided in cl 1.9. The clause is not identical to SEPP 1 and its construction and operation has apparently received little judicial consideration to date.
3. The objectives of the clause are identified in cl 4.6(1)(a) and are considered further below. Subclause (2) provides that development which contravenes development standards in any environmental planning instrument may be permissible provided cl 4.6 is complied with. Subclause (4)(a)(ii) mandates that a development will be in the public interest if it is consistent with the objectives of the particular development standard and the objectives for development within the zone in which the development is proposed to be carried out (and the concurrence of the Director-General has been obtained). The Commissioner found subclause (4)(a)(ii) was satisfied, at [59]. This appeal challenges two of the Commissioner's findings in relation to subclause (4)(a)(i) at [60], [61], [62] and [64]. Subclause (4)(a)(i) requires that a consent authority must be satisfied that the written request required by subclause (3) adequately addresses the matters in subclauses (3)(a) and (b).
4. Clause 4.6(3)(a) requires a written report of an applicant to demonstrate that compliance with a development standard is unreasonable and unnecessary. The EPA Act and the LEP contain no definition of "unreasonable" or "unnecessary". There are limiting words to some extent in subclause (3)(a) in that what is "unreasonable or unnecessary" must relate to "the circumstances of the case". The circumstances of the case are not defined in any way suggesting a wide scope in the meaning of that phrase. Subclause (3)(b) requires a written report to demonstrate that sufficient environmental planning grounds support the contravention of a development standard. The EPA Act or the LEP do not define "sufficient" or "environmental planning grounds". As the Appellant submitted these phrases are of wide generality enabling a variety of circumstances or grounds to justify contravention of the particular development standard. The "sufficient ... grounds" must be "environmental planning grounds" by their nature. The word "environment" is defined in the EPA Act to mean "includes all aspects of the surroundings of humans, whether affecting any human as an individual or in his or her social groupings".
5. The Appellant submitted that cl 4.6 should be construed as if beneficial or remedial, citing Pearce and Geddes at [9.2] to support its submission that flexibility in the application of development standards is an overriding principle as contained in subclause (1)(a) informing the statutory construction task. The discussion at [9.2] of Pearce and Geddes does not appear relevant to the construction of cl 4.6 which is couched in subclauses (2), (3) and (4) in terms of permitting the contravention of development standards in specified circumstances which would otherwise prohibit development. The discussion and examples identified in Pearce and Geddes refer to provisions which remedy some injustice or more broadly legislation which provides advantages to the individual or the public.
6. I am not aware of any planning law cases which refer to the EPA Act in such terms, in contrast for example to the Land Acquisition (Just Terms Compensation) Act 1991 (NSW) and the Aboriginal Land Rights Act 1983 (NSW) in relation to which the Court has jurisdiction. The cases of Michel Projects Pty Ltd v Randwick Municipal Council (1982) 46 LGRA 410 and Legal & General Life of Australia Ltd v North Sydney Municipal Council (1990) 69 LGRA 201 referred to by the Appellant also do not discuss similar earlier provisions in environmental planning instruments in such terms. As I understand these cases, they are simply construing the provisions before them. I agree with the Council that the statutory context for cl 4.6 suggests that an indulgence is being sought for a variation of a development standard which would otherwise prohibit development not complying with it. This suggests the clause should be construed strictly applying the usual meaning to its terms in the context of the clause as a whole.
7. Turning to the first ground of appeal, it refers to a finding of the Commissioner at [60] in relation to the environmental planning grounds identified in the written request, as required by cl 4.6(3)(b). The Commissioner concluded that the grounds referred to were not particular to the circumstances of the proposed development on the particular site. Firstly, it is debatable that this ground of appeal couched as the misconstruction of subclause (4)(a)(i) does identify a question of law. The Commissioner's finding, that the grounds relied on in the written report were not particular to the circumstances of the proposed development on this particular site, is one of fact. That informed her finding of whether the grounds put forward were sufficient environmental planning grounds.
8. To the extent the issue raised can be described as a question of mixed fact and law, the Commissioner is exercising a discretion under subclause (4)(a)(i) in relation to the written report where the terms in subclause (3)(b) of sufficient environmental planning grounds are not defined and have wide import, as the Council submitted. There is no specific limitation on the Commissioner exercising her discretion as to whether she was satisfied under subclause (4)(a)(i), subject to the usual constraints on the exercise of administrative power none of which are raised against the Commissioner in this appeal. Her reasoning in [61] identifies other ways of establishing that compliance with a development standard is unreasonable and unnecessary, referring to Wehbe v Pittwater Council [2007] NSWLEC 827; (2007) 156 LGERA 446 at [44]-[48]. Her approach in [62] is consistent with the construction of cl 4.6 in light of the fact that it is not identical to SEPP 1. This confirms the Commissioner's reasoning that the different wording in cl 4.6 suggests that the approach to principles in relation to SEPP 1 applications does not apply precisely. The Commissioner has identified the differences from SEPP 1 and construed the words of cl 4.6 on their own terms, as she is required to do. No error in doing so has been established by the Appellant.
9. Further support for the Commissioner's approach is derived from the use of the word "sufficient". Contrary to the Appellant's submission that this suggests a low bar, I draw the opposite inference, namely that the written report must address sufficient environmental planning grounds to inform the consent authorities finding of satisfaction in cl 4.6(4)(a)(i). Nor do I accept the Appellant's submission that the Commissioner's finding is contrary to the objectives in subclause (1) which refer to appropriate flexibility being approved in particular circumstances. The Commissioner's approach is consistent with subclauses (1)(a) and (b).
10. To submit as the Appellant does (par 12) that a certain course was common sense (assuming that is correct) or that the Commissioner's approach was counter-intuitive does not mean that the exercise of discretion as to whether she was satisfied was in error in the context of cl 4.6. The planning matters described as common sense were taken into account by the Commissioner in accordance with cl 4.6. Resorting to common sense as an approach to statutory construction is often an attempt to have the merits of a decision considered, and that observation applies here. These submissions are not identified questions of law arising from the judgment but complaints about the merits of the Commissioner's decision. The first ground of appeal is unsuccessful. While that finding means that the appeal cannot succeed, I will nonetheless address ground 2.
11. Turning to ground 2, the Appellant essentially argues that the Commissioner should have allowed the written request responding to cl 4.6(3)(a) considerations of "unreasonable or unnecessary in the circumstances of the case" to be answered by finding that the development is in the public interest as satisfied by subclause (4)(a)(ii). The Commissioner found at [62] and [64] the obligation imposed on the written report by subclause (3)(a) had to be demonstrated separately from the matters addressing subclause (4)(a)(ii). This submission overlooks the terms of cl 4.6 which mandates that the Commissioner cannot grant development consent for development that contravenes a development standard unless satisfied of matters in both subclauses (4)(a)(i) and (ii). The Commissioner has a wide discretion under the terms of subclause (4)(a)(i) in considering whether the written report prepared on behalf of the Appellant satisfied subclause (3).
12. Contrary to the Appellant's submission, and accepting the Council's submission, there is every reason to construe cl 4.6(4)(a)(i) as if it has more work to do than subclause (4)(a)(ii), not least because "and" is between the two subclauses. "And" is generally read conjunctively unless there is a clear mistake in the drafting (per Pearce and Geddes at [2.29]). The use of "and" suggests the requirements in subclauses (4)(a)(i) and (ii) are separate requirements. As the Council submitted, summarised above in par 21, the Appellant's construction would leave no work for subclause (4)(a)(ii) to do.
13. The Appellant couched its oral argument as the Commissioner asked herself the wrong question in relation to cl 4.6(a)(i) in that the question that the Commissioner implicitly asked in [60] and answered incorrectly was: Under cl 4.6(3)(b) can an applicant seek to justify the contravention of a particular development standard on the basis that there are sufficient environmental grounds to justify contravening the standard only by reference to grounds "that are not particular to the circumstances of the proposed development"? While reasoning in cases addressing appeals on questions of law referred to by the Appellant have been expressed as whether a decision-maker asked the wrong question, whether a ground of appeal is expressed on the basis of a wrong question being asked is a matter of form not substance. I have addressed the substance of this submission earlier in my finding. This submission does not progress this ground of appeal.
14. The reliance of the Appellant on the use of the word "seek" does not support the statutory construction argument of the Appellant. That a written report must seek to justify, rather than justify, a matter does not take the argument in this case any further. The Appellant seemed to be submitting that use of the word "seek" waters down the obligation of a written report under cl 4.6(3) to properly address (a) and (b), suggesting a low hurdle. Subclause (4)(a)(i) requires that a consent authority must be satisfied that the written request adequately addresses matters required by subclause (3) which undermines that submission.
15. There is nothing counter-intuitive about the Commissioner's approach which appears a well-reasoned approach to the construction of the clear terms of the clause. For all these reasons, the Appellant is not successful on the second ground of appeal.
16. The Appellant submitted orally that there would be practical implications for developers if the Council's submissions are accepted and the Commissioner's judgment upheld. The implication seemed to be that it is unfair that developers in Class 1 proceedings who otherwise comply with cl (4)(a)(ii), including through making amendments to plans in the course of proceedings so that a project satisfies the public interest for the purposes of that subclause, not succeed because a written report prepared some time before did not address sufficiently the matters required by subclause (3). That is not a reason not to apply the usual principles of statutory construction which point clearly against the Appellant's construction of the clause. Clause 4.6 is different to SEPP 1, as the Commissioner identified in [61]-[62]. Developers and their consultants now have the benefit of the Commissioner's observations at [61]-[62] referring in turn to Wehbe at [44]-[48] to guide them in determining, firstly, whether it is appropriate to seek a variation of a development standard and, secondly, the content of the written report required by subclause (3) if the decision is made to seek a variation of a development standard.
17. This appeal should be dismissed and costs reserved.

Orders

1. The Court makes the following orders: 1. The appeal is dismissed. 2. Costs are reserved.

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