GMKA Pty Ltd v Penrith City Council [2020] NSWLEC 1442 | Case summary

GMKA Pty Ltd v Penrith City Council [2020] NSWLEC 1442 | Case summary | Zoe

[7]

Interpretation of Chapter D5 of Penrith Development Control Plan 2014

Chapter D5 of the DCP includes section 5.11, which is concerned specifically with boarding houses. There is disagreement between the parties as to whether section 5.11 directs that certain controls in the DCP, otherwise applying to multi dwelling housing, should be applied to the evaluation of the subject proposal.
I agree with Council's Written Closing Submission filed on 7 August 2020 ('CWCS', par 10) that the "key relevant objectives" of section 5.11 are: "a) To ensure that boarding houses fit the local character or desired future character of the area. b) To minimise negative impacts on neighbourhood amenity."
Section 5.11 nominates a set of "controls" covering six topics. The following three topics are more relevant here: local character, built form and tenant amenity. I reproduce the relevant controls, as follows: "1) Local Character a) Boarding house development applications shall be accompanied by detailed site analyses to assist with the determination of local character. b) A neighbourhood analysis should be completed to identify the desired future character of the neighbourhood. It is recommended that community consultation be undertaken as part of the analysis to determine aspirations for the future character. c) Key elements that contribute to consideration of local and neighbourhood character include: - Surrounding land uses - Social and Historic Context - Scale - Built Form - Natural Environment - Density - Amenity - Safety and Security - Social dimensions and housing affordability - Aesthetics (2) Built form, Scale and Appearance … c) Boarding houses shall be designed to have a sympathetic relationship with adjoining development. d) Proposals must demonstrate that neighbourhood amenity will not be adversely impacted by factors such as noise and privacy. e) in a Low Density zone, boarding houses should comply with controls for Single Dwellings where these controls do not conflict with the requirements of the SEPP. f) A boarding house proposal of a scale similar to a multi dwelling housing development should comply with the controls and objectives for multi dwelling housing within this DCP, where they are not in conflict with the requirements of the SEPP and the objectives of the zone. g) A boarding house proposal of a scale similar to a residential flat building or high density mixed use development should comply with the controls and objectives for residential flat buildings within this DCP, where they are not in conflict with the requirements of the SEPP and the objectives of the zone. 3) Tenant Amenity, Safety and Privacy Boarding houses are to maintain a high level of resident amenity, safety and privacy by ensuring: … c) cross ventilation is achievable such that reliance on air-conditioning is minimised; …"
It can be seen that the controls nominate development assessment principles and do not provide numerical standards of themselves. They also link to other provisions in the DCP, where certain detailed controls including numerical standards do sit.
The interpretive disagreement between the parties is in regard to whether subsection (2)(f), as reproduced above, applies. If it does apply, under section 5.11 of the DCP, boarding houses, and thus the subject proposal, "should comply with the controls and objectives for multi dwelling housing".
The multi dwelling housing controls are at section 2.4 of Chapter D2 of the DCP. Section 2.4 includes numerical standards for such matters as: minimum lot frontage, breaks between buildings, wall length and building setbacks; which in certain circumstances would be more stringent than might apply, for example, to single dwellings or dual occupancy development.
The Council's position is summarised in the CWCS (par 13): "The task is straightforward: where the boarding house is proposed in a low density zone, the designer has regard to the built form controls for single dwellings. Where the boarding house is of a scale similar to a residential flat building, the proposal should comply with the RFB controls. Where the proposed boarding house is of a scale similar to a multi dwelling housing development, the controls and objectives for multi dwelling housing are to be applied. Thus there is necessarily a comparative exercise to be undertaken. It is common ground that (e) and (g) do not apply in this case. RFBs are not permissible in the R3 zone, but multi dwelling housing is (as are single dwellings). Council says that, given its ordinary meaning and context in the DCP, multi dwelling housing is of a scale somewhere between a single dwelling and a residential flat building in a high density zone."
The CWCS (par 16) referenced four factors which were indicated as suggesting the proposal was of a scale similar to multi dwelling housing, in particular when compared to a single dwelling. These included the fact that 18 boarding rooms were proposed, as well as the size of the basement parking, waste facilities and driveway.
The applicant does not agree that the proposal should comply with the controls and objectives for multi dwelling housing. It is argued in the Applicant's Written Final Address filed 24 July 2020 ('AWFA', par 11) that: "…For those provisions to first comply the proposal must be of a similar scale to 'multi dwelling housing'. With respect it is a comparative exercise but more importantly it is both a quantitative and qualitative assessment which is predicated on the knowledge of what first is a 'multi-dwelling housing'. The second is to compare the scale of the proposed and see if they are 'similar'. With respect Council just plainly gets this task wrong and has done so from the very beginning. A multi-dwelling housing development has dwellings that have "access at ground level". So, the proposed must be compared to a multi dwelling development that necessarily has access at ground level to each of its dwellings. The best example of what is a 'multi-dwelling housing' is what is typically referred to as a townhouse style development. While Mr Anzellotti said that the proposed development met the definition of multi dwelling housing …, he (a) accepted townhouses would by definition fall under multi-dwelling houses; (b) accepted that townhouses typically have one or two bedrooms on the first storey, living areas on the ground floor, or it's a villa type development with bedrooms and living areas separate; (c) said in response to the Commissioners question as to what were the type of developments that were 'multi dwelling housing', he said townhouses, seniors housing and group homes"; (d) said that common multi dwelling housing in Penrith is provided on a single lot with the handle divided to the side or centrally."
The AWFA references an existing "much larger scale" development at 18-22 Anthony Street for comparison, agreed as providing multi dwelling housing, and which was inspected during the site view.
The experts were also in disagreement in regard to interpretation. In oral evidence, Mr Anzellotti concluded that the proposal met the definition of multi dwelling housing. It would follow this conclusion that the DCP's multi dwelling housing provisions would apply to the proposal. On the other hand, Mr Wood posited, in the Planners' Joint Expert Report (Ex 4, par 78), as follows: "The controls are not clear on specific setbacks in an R3 zone and it defers to consideration of the scale of a development. In my view the development site, if not to be used as a boarding house, is not capable of being redeveloped as multi-dwelling housing given that the site does not satisfy the minimum lot size of 800m2 in the PLEP 2010 (being only 705m2) - and it also does not achieve the 22m lot frontage in the PDCP 2014. Therefore the maximum development potential of the site, in the absence of the proposal, is a Dual Occupancy which is another form of development permitted in the R3 zone provided that the site area exceeds 600m2. On that basis I consider that in establishing the building envelope the dual occupancy provisions are more relevant than the multi-unit housing controls and I consider that the development, subject to adjustment of the rear setback, meets those controls for dual occupancies in the PDCP 2014."

[8]

Consideration

The question for attention here is whether the proposed boarding house is of "a scale similar" to a multi dwelling housing development. It follows for me that the attention given by the applicant to whether the proposal was similar, or more correctly, dissimilar to a townhouse development, in its form or character, was for the most part misplaced. The applicant's emphasis on the "qualitative" in the comparative test, was for me unconvincing as here, really, I am merely comparing medium density housing forms.
In Veloshin v Randwick City Council [2007] NSWLEC 428 at [29], Roseth SC finds that "scale is properly used only when referring to the relative size of two or more things". One interpretive problem here is that multi dwelling housing comes in all sorts of different "sizes". While acknowledging that the minimum site area for multi dwelling housing is 800m2 and the site is only 705m2 in area, this fact does not somehow direct me to ask a question whether a dual occupancy might provide a better comparison. For me the discretion involved in the term "similar", when compared, say, to the term "the same", directs me to conclude that the proposal would be of a scale similar to what might be expected of a smaller multi dwelling housing development. I am inclined to see this as sufficient to qualify the proposal for the trigger at section 5.11(C)(2)(f) of the DCP.
It will be observed that the proposal would not comply with the applicable numerical standards in regard to certain multi dwelling housing controls. In that regard, I acknowledge Council's reference (CWCS, par 20) to the principles relevant to consideration of development control plans as found by McClellan CJ in Stockland Development Pty Ltd v Manly Council (2004) 136 LGERA 254; [2004] NSWLEC 472 at [87], and Zhang v Canterbury City Council (2001) 115 LGERA 373; [2001] NSWCA 167 (including at [75]). But I also need to have a mind to s 4.15(3A) of the EPA Act which would require me to be flexible in applying such standards and allow reasonable alternative solutions that achieve the objects of those standards. The application of flexibility is best considered in a practical sense with the consideration of the details of the proposal, which I turn to now.

[17]

Consideration

I agree with Mr Wood that the large hardstand parking area within the adjacent child care centre is a visually prominent element in the immediate streetscape. The open and pleasantly treed landscape of the WSU campus (notwithstanding the large carpark on this site as well) is also prominent when considering the streetscape in which the proposal is located. The tall trees along the southern side of Chapman Gardens also come into view. It is immaterial that these are different land uses to residential when streetscape compatibility is in question. Moving eastwards along Second Street, and if the extent of vegetation in the streetscape is the point of interest, the street trees play a prominent role. That is to say, it is quite common for housing blocks to consist of open grassed areas, rather than heavily vegetated in the front setback, alongside a driveway in the foreground to the mostly single storey residences.
The streetscape presentation of the proposal provides for not as much grassed area in the front setback as other dwelling houses in the street, but the proposal provides greater vegetation prominence and of considerable scale. Mr Anzellotti's concerns in regard to aerial cabling are acknowledged but this problem exists at present, both on the subject site and with street trees in the local setting. Some pruning would be needed from time to time. I conclude similarly in regard to Mr Anzellotti's concerns in regard to tree canopies proposed for the site extending onto the nature strip. Tree canopies extending across the boundary of private lands and road reserve nature strips, either way, seems to me to be a common enough occurrence, and often with more positive than negative effect.
The landscaping as proposed seems to me to respond satisfactorily to what is a somewhat mixed setting in landscape terms. In adopting the Project Venture [22] meaning of the term "compatibility", as "capability of existing together in harmony", and mindful of cl 29(2)(b) of the SEPP, I believe the proposed landscape treatment of the front setback area is compatible with the streetscape in which the building is located.
Given this finding, and the jurisdictional limits provided at cl 29(2)(b) of the SEPP, I will consider the question of landscaping along the side and rear boundaries in the context of the next topic.

[20]

The building responds, as follows, with regard to these controls:

The proposal has a building length of 29.975 more than the control requiring "building blocks" no longer than 20m (section 2.4.4(3)(a)).
The 29.975m building length is 65% of the site length when the controls provides for a maximum of 50% (section 2.4.4(3)(b)).
The upper level is setback somewhat from the ground level but not to Council's satisfaction (section 2.4.4(4)(c)).
The side setback is 2m on the western side but only 1m on the eastern side, there are variations to the building which introduce corners but Council would suggest not to the extent, or casting the depth of shadows or projections, requested by these controls (section 2.4.6(7)(a) and section 2.4.4(b)).

Council contends that as a consequence of not meeting DCP standards the proposal is an "overdevelopment" and is "excessively bulky in appearance and antipathetic to the current and future desired character of the area" (Ex 1/Tab 14, par 5(d)). The connection between landscaping and setback widths is also noted (ibid, par 1(f)): "The development does not provide adequate setbacks to the sides or rear to enable landscaping or mature plantings which would assist in ameliorating the impacts of bulk and scale or which would complement the existing essential character, which includes key features such as remnant mature canopy trees and generous rear private gardens which contribute to a green corridor of trees and shrubs along adjacent backyards."
Mr Anzellotti is concerned about insufficient deep soil along side boundaries to enable landscaping for visual relief when viewed from adjoining properties (Ex 4, par 7). On the other hand, Mr Wood's evidence is that (Ex par 14): "the building is articulated along the side elevations … where the building contains a series of steps in the façade and the upper level that is setback beyond the ground floor …with the exception of the south-western (sic) corner of the first floor that is 2 storeys however I consider this is offset by the large balcony area that provides articulation and relief."
Mr Wood is also happy with the revised landscaping plan which increases the amount of side boundary planting and improves the arrangement for rear planting.

[21]

Consideration

The proposal is non-compliant with certain DCP standards. In such instances I am required, under s 4.15(3A) of the EPA Act, "to be flexible in applying those provisions and allow reasonable alternative solutions that achieve the objects of those standards".
When I do turn to the objectives of the standards, what I see is a development that does show some characteristics of what might be thought of as traditional suburban development. The proposal does orient to the street. It would have a reasonably deep front garden and significant planting along both side boundaries in the front setback. The overall intention is to accommodate landscaping which is more substantial than the more open grassed frontages which are characteristic to the street. This type of more concentrated front landscaping, when compared to the prevailing open grassed frontages, is seen as reasonable and appropriate, bringing a visually softening effect on the built form proposed here and which can be expected more widely, given the medium density zoning which now applies. The front (eastern-side) balcony is also a positive visual feature in the streetscape, orienting the development to "face the street". There is an oversized driveway when compared with existing dwelling houses, but this proposal constitutes a (permissible) boarding house, something different to, currently characteristic, single storey dwelling houses. The driveway, which leads into a basement parking area, is not the gun-barrel style which the DCP seeks to avoid.
My concern about the DCP's controls seeking to break the length of buildings to a maximum of 20m and not more than 50% of side boundary length, is that they seem more applicable to multi dwelling housing than to boarding houses as a typology. There is some support for this interpretation when the approved development at 1 Edna Street, generally cited as a positive exemplar in the evidence, is considered (Ex 2 Tab 4).
The DCP is also seeking to provide "reasonable" landscaped separation between neighbouring buildings. There is 2m of deep soil along the western boundary, which abuts a residence, and only 1m of deep soil along the eastern side boundary, which abuts the child care centre. There is generally a 4m deep soil area and setback to the rear. This is generally sufficient to provide reasonable landscaping in accordance with the revised landscape plan (Ex C) and the conditions suggested by the planning experts in regard to the trimming of the Cherry Lilly Pilly, and adopted in the draft without prejudice conditions filed 14 July 2020 (Ex G) at Conditions 6(f) and 114; and relocation of the two Blueberry Ash trees provided within the rear setback (Condition 6(e)). Further, the separation arrangement, which is greater to the dwelling to the west (minimum 2m building to the boundary allowing more spread) and less to the (non-residential) child care centre to the east (minimum 1m building to the boundary) is a reasonable resolution, when the considerable front setback eastern boundary planting is considered.
I accept Mr Wood's evidence that the proposal is satisfactory in regard to building form, bulk and scale (including setbacks) and incorporates a satisfactory extent of articulation for this particular development, especially given the atypical neighbour, and capacity for landscape screening.
When considering, overall, whether the proposed scale and visual character of the proposal is satisfactory, development in the near vicinity needs to be given considerable weight, and the fact of the child care centre and its setting needs to be acknowledged. In addition, in this medium density zone the future character has more weight than the existing low density cottage character evident otherwise in the broader locality.

[22]

Amenity impacts

Ensuring a "high level of residential amenity is achieved" is the sixth objective of the Medium Density Residential zone. The core contentions were that the amenity of adjoining properties would be unreasonably impacted upon as a consequence of non-complying side setbacks and by the location of windows and openings; as well as the elevated nature of the proposal especially to the rear. The concerns centrally related to visual and acoustic privacy (and safety in regard to the child care centre), and the potential for a sense of visual overbearing.
I am satisfied that the landscaping as now proposed would adequately soften the visual presentation of the building to the residential neighbours. While front setback landscaping will soften the presentation from the street, there is less capacity to soften the visual massing when viewed from within the child care centre. However, and noting the proposal's compliance with height controls, I am less concerned about this impact on this child care centre development, which provides a service to residents rather than exists as a residential use of itself.
I agree with the experts that visual privacy, or potential for overlooking, requires careful consideration, especially given the raised floor level at the rear. The draft conditions list a series of requirements which are intended to have the effect of heavily restricting overlooking opportunities. The particulars are specified in Ex G (Conditions 6(g)-(j)) but essentially the windows with potential for overlooking, both at ground and upper levels would have obscured glazing to a height of 1600mm above the finished floor level. All bathroom windows would be provided as obscured glazing. In addition, the privacy screen provided to the side elevation of the rear outdoor common terrace area would be solid and free of any gaps that can be seen through towards the child care centre (Condition 6(k)).
Turning to acoustic privacy, it is noted that Ex G provides for a deferred commencement condition in regard to this matter. The Noise Impact Assessment accompanying the application would need to be amended to the satisfaction of Council detailing how the demolition/construction and operation of the building meets relevant noise criteria. Certain baseline noise requirements are also listed in Ex G, including no loud music in the outdoor common open space, and limiting use of this space to between 7am and 10pm, with the courtyard use ceasing at 9pm (Condition 5).
Overall, the draft conditions at Ex G appear to me to adequately address amenity concerns.

[27]

Contributions

The draft conditions as filed (Ex G), without prejudice on Council's part, would require the payment of contributions towards provision or improvement of public amenities and services. The specific contributions are nominated at Conditions 121, 122, and 123, and would in essence have the effect of requiring contributions as outlined below (subject to indexation): 1. Condition 121 for 'Cultural Facilities' an amount of $3,611.00; under the Penrith City Council's Development Contributions Plan for Cultural Facilities, 2003 ('Cultural Facilities Plan'). 2. Condition 122 for 'District Open Space' an amount of $41,577.00; under the Penrith City Council's Development Contributions Plan for District Open Space, 2007 ('District Open Space Plan'). 3. Condition 123 for 'Local Open Space' an amount of $15,029.00 under the Penrith City Council's Development Contributions Plan for Local Open Space, 2007 ('Local Open Space Plan').
Subdivision 3 of Part 7 of the EPA Act includes provisions for such contributions. Section 7.11 establishes certain principles in relation to the imposition of conditions towards provision or improvement of amenities or services, including that they be "reasonable" (s 7.11(2) and s 7.11(4)). Then, s 7.13 introduces the need for contributions plans. It provides, relevantly, as follows: (1) A consent authority may impose a condition (in relation to contributions towards provision or improvement of public amenities and services) only if it is of a kind allowed by, and is determined in accordance with, a contributions plan (subject to any direction of the Minister under this Division). (2) However, in the case of a consent authority other than a council - (a) the consent authority may impose a condition (in relation to contributions towards provision or improvement of public amenities and services) even though it is not authorised (or of a kind allowed) by, or is not determined in accordance with, a contributions plan, but (b) the consent authority must, before imposing the condition, have regard to any contributions plan that applies to the whole or any part of the area in which development is to be carried out.
There are both legal and planning arguments in relation to these conditions. The arguments seem to be able to be framed, briefly, with three queries: 1. Validity of the conditions as put by Council - or whether the conditions are "of a kind allowed by, and (have been) determined in accordance with, a contributions plan" (s 7.13(1) of the EPA Act) 2. If not, whether the Court would be inclined to impose conditions requiring contributions under s 7.13(2) 3. If so, what is a reasonable basis for the contributions - including whether the conditions suggested by Council are reasonable.

[28]

Validity of conditions as put by Council

There are two tests established by s 7.13(1) of the EPA Act. The first is that the condition be "allowed by" the contributions plan. The second is that the condition be "determined in accordance with" the contributions plan.
Council submits that (CWCS, par 74): It is clear from the above that each Contributions Plan applies to all residential development within Penrith LGA. A boarding house is a form of residential development permissible in the R3 zone and thus each Plan applies to boarding house development in that zone. As a matter of statutory construction therefore, the monetary contribution sought in the proposed condition is 'of a kind allowed by' each Contributions Plan and is permissible pursuant to s 7.13(1) of the EPA Act.
It is clear from the evidence that the three contribution plans do not refer directly to 'boarding houses'. The Cultural Facilities Plan provides as follows at cl 7.1: "7.1 WHAT TYPES OF DEVELOPMENT WILL BE LEVIED? This Plan requires that a contribution be applied to new residential development including, but not limited to, housing for older people, multi-unit housing (including integrated housing), shop top housing, dual occupancy and subdivision." (emphasis added by me)
Clause 2.5 in both the District Open Space Plan and Local Open Space Plan, provide the following statement which Council argues would "allow" contributions conditions for boarding houses: "This Plan enables the levying of developer contributions where residential development (including subdivision) is permissible in the City of Penrith."
I also note that the cl 2.3(c) of both the District Open Space Plan and Local Open Space Plan indicate the purpose of these plans is to "authorise" the imposition of contributions conditions.
Boarding houses are defined in the Dictionary to the LEP as a form of "residential accommodation". I note also that in the caselaw, boarding houses have been found "to be capable of being occupied or used as a separate domicile" and thus found to be "dwellings" (SHMH Properties Australia Pty Ltd v City of Sydney Council [2018] NSWLEC 66 at [63]). In turn, I have no difficulty in finding that boarding houses would fall within the term "new residential development" in cl 7.1 of the Cultural Facilities Plan. Insofar as the question is applied here, conditions for boarding house development would be the "kind allowed" to "be levied". While the other plans are a little less explicit, similarly I would find that as contribution conditions are authorised to be levied under the District Open Space Plan and Local Open Space Plan for residential development, then such conditions would be allowed for boarding houses.
I am satisfied, that the first test of legitimacy is satisfied; that the contribution conditions as applied here by Council are of a kind allowed by the contribution plans. I now turn to whether the conditions have been "determined in accordance with" the contributions plan.
The Cultural Facilities Plan indicates "occupancy rates" for the four different types of "new residential development" listed in cl 7.1. There are similar provisions in the other contribution plans. The occupancy rates adopted in the plans are a key variable in the calculation involved in the determination of the contribution which the "condition" would seek to impose.
It is reasonable to consider that the test established by s 7.13(1) of the EPA Act, that the condition be "determined in accordance with" the contributions plan, would involve the use of such occupation rates (or similar) adopted in the plans to calculate the actual contribution embodied in the relevant condition. In this instance, Council has assumed an occupation rate for boarding houses and applied it to this proposal. The assumed occupation rate was formally adopted by Council after consideration of a report to Council's Policy Review Committee Meeting of 9 July 2018 titled 'Boarding Houses and Development Contributions for Local Infrastructure' ('Contributions Report'). There have been no modifications to the contribution plans subsequent to the adoption of this occupation rate by Council.
In this instance the contribution conditions have been determined based on a policy position adopted by Council but not embodied in a contributions plan (1.34 persons per boarding room has been adopted to calculate contributions). It is necessary for the contribution conditions to be determined in accordance with the contribution plans, rather than a separate Council policy position. The second test of s 7.13(1) of the EPA Act has not been met, which would invalidate the imposition of the conditions by Council.

[29]

Whether the Court should impose contribution conditions under s 7.13(2)

In their further supplementary joint report filed 8 July 2020, the planning experts considered contributions. They agreed that there was a nexus between the increased population associated with the approval of the boarding house development and the demand for services. The agreed conclusion was that it was reasonable for contributions to apply to boarding house developments. The experts disagreed with the reasonableness of applying an occupancy rate of 1.34 persons to determine contributions for this boarding house development.
The experts indicated that they were familiar with the Contributions Report, including its concerns with the merit and scope for levying development contributions on new boarding house developments. This report included a review of 18 boarding house proposals submitted to Council in the then recent past, averaging the occupancy levels out to come to the 1.34 persons per room occupancy rate now proposed by Council.
Mr Wood's view was that the number of occupants in a boarding house development was clear, for example when compared to occupancy rates for a dwelling. In instances of uncertainty an averaging out of occupancy rates was reasonable. But in this instance it was clear that there would be 18 persons occupying the proposal, given its 18 single rooms. According to Mr Wood, the total contribution for 18 persons would calculate to $42,690 a difference of $17,527 when compared to the 1.34 persons per room occupancy rate assumed by Council.
In reference to the Contributions Report, Mr Anzellotti was of the view that (Ex A, par 28): "…(the) 1.34 person rate for this boarding house is acceptable as this is an interim rate based upon the recent interest in boarding house developments. This is in the process of being reviewed with the finalisation of the new citywide contributions plan with a draft version expected to be reported to Council by the end of this year."
Mr Anzellotti also observed that the 1.34 rate could account for visitors among other things. He also indicated that Council's contribution rates do not distinguish between number of bedrooms in proposed medium density residential developments. The conclusion was that this averaging approach was broadly consistent with Council's general approach to contributions.

GMKA Pty Ltd v Penrith City Council

At a glance

Court

Decision date

Catchwords

Source

Catchwords

Judgment (34 paragraphs)

Parties

Cases Cited (7)