Grace & Anor v Thomas St Cafe Pty Limited &

THIRD RESPONDENT Primary Court Pty Limited

FOURTH RESPONDENT North Sydney Council

KEY ISSUES: Practice and Procedure :- notice of motion to vacate hearing dates - undertaking to cease use until further order- potential amendment to Local Environmental Plan - rezoning of subject land - development application lodged

LEGISLATION CITED: Environmental Planning and Assessment Act 1979 ss 72J, 124(3)

ACR Trading Pty Ltd v Fat-Sel Pty Ltd (1987) 11 NSWLR 67 Grace & Anor v Thomas Street Café Pty Limited & (3) Ors [2006] NSWLEC 547 Grace & Anor v Thomas Street Café Pty Ltd & Ors [2007] NSWCA 359 CASES CITED: Grace & Anor v Thomas Street Café Pty Ltd & Ors (No 2) [2008] NSWCA 72 Meggitt Overseas Ltd & Ors v Grdovic (1998) 43 NSWLR 527 National Trust of Australia (NSW) v Heritage Council of NSW & Anor [1999] NSWLEC 104 Re Minister for Minerals and Energy; Ex Parte Wingate Holdings Pty Ltd [1987] WAR 190 Sydney City Council v Ke-Su Investments Pty Ltd & Ors (1985) 1 NSWLR 246

APPLICANTS: S A Duggan (barrister) and M A Staunton (barrister) SOLICITORS: Wilshire Webb Staunton Beattie

FIRST, SECOND & THIRD RESPONDENTS: LEGAL REPRESENTATIVES: T A Alexis SC and J L Doyle (barrister) SOLICITORS: Thomson Playford

FOURTH RESPONDENT: C Rose (solicitor) SOLICITORS: Maddocks

JUDGMENT:

• 3 - THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES

LEC No. 41204 of 2005 GRACE & ANOR v THOMAS STREET CAFÉ PTY LIMITED & (3) ORS (No. 2) [2008] NSWLEC 179

EX TEMPORE JUDGMENT 1 HIS HONOUR: For some decades a café was operated at No. 2 Thomas Street, McMahons Point. The various operators of the café and the relevant local government authority believed that the premises had the benefit of existing use rights and that the use of the premises as a café was lawful. 2 On 13 October 2005, the applicants, who live opposite the café at No. 18 Victoria Street, McMahons Point, brought proceedings for a declaration that the use of No. 2 Thomas Street for the purpose of a refreshment room was unlawful, for an injunction restricting that use, and for a declaration that three development consents granted by the council to the extent that they purport to authorise the current use are invalid. 3 The applicants' claim was heard over four days from 14 August to 17 August 2006. In a reserved judgment published on 4 October 2006 I dismissed their application, finding that the premises enjoyed existing use rights: Grace & Anor v Thomas Street Café Pty Limited & (3) Ors [2006] NSWLEC 547. 4 The applicants appealed. In a judgment published on 12 December 2007, the Court of Appeal took a different view of the facts and held that the premises did not enjoy existing use rights: Grace & Anor v Thomas Street Café Pty Ltd & Ors [2007] NSWCA 359. On 24 April 2008, the Court of Appeal made formal orders making a declaration to that effect and remitting the matter to this Court for determination of the orders that should be made: Grace & Anor v Thomas Street Café Pty Ltd & Ors (No 2) [2008] NSWCA 72. The Court of Appeal made an order for costs in favour of the applicants in that case, and ordered that the costs of the hearing at first instance before me are to be determined by me in the remitted hearing. 5 In remitting the matter the Court of Appeal noted [at 139] that the range of relief in the circumstances of this case is extraordinarily wide, extending from refusing relief to granting relief but allowing the cafe to continue to trade for a period of time, with or without conditions of continued use being imposed, to ordering full relief as sought by the applicants. 6 The remitted hearing is due to commence on 2 June 2008 for four days. The parties have prepared the matter for the remitted hearing. I have been informed that some 40 or so affidavits have been filed and that at least two expert witnesses have been engaged. 7 The first, second and third respondents, however, now apply by notice of motion to vacate the hearing dates on the basis of their undertaking, without admission, not to use the premises for the purpose of a refreshment room or takeaway food shop until further order. They rely upon s 124(3) of the Environmental Planning and Assessment Act 1979 ("the Act"), which relevantly states that where a breach of the Act would not have been committed but for the failure to obtain a development consent, the court may, upon application being made by the defendant, adjourn the proceedings to enable a development application to be made to obtain that consent. 8 The facts upon which the first, second and third respondents rely may be briefly stated. On 19 May 2008, the council resolved as follows: A. THAT in order to permit the ongoing use of the Thomas Street café within the new Comprehensive LEP, the site be rezoned R3 - Medium Density Residential and 'restaurant' be inserted into Schedule 1 as an additional permitted use at 2 Thomas Street, McMahons Point (Lot 1, SP 55380). The proposed rezoning of the site shall go on public exhibition as part of the revised Local Environment Plan.

B. THAT in order to control the intensity of development at 2 Thomas Street and the impact on the neighbourhood, the proposed DCP provisions to be incorporated into the comprehensive review of the North Sydney Development Control Plan 2002 be amended to provide for 45 seats and no intensification of use from 6 days per week.

C THAT the review of the DCP have regard to the history associated with the site in order to develop appropriate controls to minimise the intensity of any impact. 9 On 21 May 2008, the second respondent with the consent of the third respondent (joint owners of the premises) made a development application for development described as "continuation of local café and take-away food shop". I also observe that the council appears to be in favour of the rezoning and the continued operation of the café. The voting in favour of the resolution that I have described was eight in favour and one against. 10 The application to vacate the hearing dates is put on these bases: i) There is no ongoing breach of the Act. The café is not presently operating and the respondents offer the undertaking not to use the premises for that purpose until further order, so that there are no adverse environmental consequences and no prejudice will be suffered by the applicants. ii) Section 124(3) of the Act directly applies. A development application has been lodged. Section 72J of the Act allows the making of a development application even though the use is presently prohibited. iii) The council has resolved to rezone the property in its new comprehensive local environmental Plan for the express purpose of allowing the ongoing use of the Thomas St Café. iv) There has been a slippage in the timetable so that the case is not ready for hearing. In particular, the applicant's affidavit in reply has raised a new issue which the respondents will have to meet. v) The listed 4 day hearing will achieve little but consume considerable costs in debating a dead issue while the café is closed and which would not be an efficient use of limited public resources. 11 Counsel for the first, second and third respondents rely upon the judgment of Kirby P in ACR Trading Pty Ltd v Fat-Sel Pty Ltd (1987) 11 NSWLR 67, in which his Honour held that where an application is made under s 124(3), the discretion provided by the section must be exercised according to its terms and having regard to its purposes. Kirby P also said that it is the duty of the court to consider whether, and in what circumstances, the relief provided for in that sub-section should be granted. 12 In determining a motion such as this the court should exercise its discretion in accordance with settled principles. A number of the authorities to which reference has been made are cases in which there is no equivalent of s 124(3), as in the present case. Nevertheless, the guiding principle is that a proposed change in the law is not a proper consideration in the exercise of a discretion to grant an adjournment and does not qualify in any way the obligation of the judiciary to uphold the existing law: see Meggitt Overseas Ltd & Ors v Grdovic (1998) 43 NSWLR 527, per Mason P (Sheller and Beazley JJA concurring) and the cases cited therein. In particular, Mason P agreed with the dissenting view of Burt CJ in Re Minister for Minerals and Energy; Ex Parte Wingate Holdings Pty Ltd [1987] WAR 190, who said (at 194): The courts are charged with the high responsibility of administering justice according to the law as it is. A party invoking the jurisdiction of the court must be permitted to seek his justice upon that basis and the court cannot deny him that right because of a reasonable expectation that at some future date the law will be changed and with that change that his rights according to law will be changed. It may well be that his victory, should he enjoy one, will be Pyrrhic. If it is, then so be it. That is a matter for him. 13 These principles were applied by Bignold J in National Trust of Australia (NSW) v Heritage Council of NSW & Anor [1999] NSWLEC 104 in refusing an application to adjourn proceedings in which there was a challenge to the validity of three related approvals granted by the Heritage Council of New South Wales, notwithstanding a recent Cabinet decision to introduce a special bill into the parliament to validate the approvals under challenge. 14 In Sydney City Council v Ke-Su Investments Pty Ltd & Ors (1985) 1 NSWLR 246, the Court of Appeal refused an application for a consent adjournment in a case in which there was an allegation that premises were being unlawfully used as a brothel, where the application was based on the prospect of a legislative change. 15 The latter two cases involved proceedings that had been brought to restrain alleged breaches of planning controls. I acknowledge the force of the submissions of senior counsel for the first, second and third respondents that the situation would be different if the use was continuing, which was the situation in Ke-Su. It seems to me, however, that in this case the Court should not, at this stage, exercise its power under s 124(3). The principles to which I have referred strongly suggest that the hearing should proceed. That is not to say, however, that the exercise of the Court's discretion under s 124(3) could not be raised at the hearing itself. The parties have prepared for the hearing of the outstanding issue of the exercise of the court's discretion and have assembled a large amount of evidence for that purpose. If in the time between now and the hearing, the first, second and third respondents are unable to meet the fresh evidence raised in the applicants' affidavit in reply, then that evidence, if it is truly new material, will simply not be permitted to be adduced. Importantly, the adjournment will not resolve the outstanding issue of costs. Finally, although the council strongly supports the rezoning, its proposal to do so is yet to be advertised and public submissions on the proposal are yet to be received, so that it cannot be said with certainty that the rezoning will eventuate. 16 The motion to vacate the hearing dates is dismissed with costs. I hereby certify that the preceding 16 paragraphs are a true copy of the reasons for judgment herein of the Honourable Mr Justice D H Lloyd.

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