Grant William Clarke v Shoalhaven City Council

Background facts

1. The Subject Land is zoned RU1 pursuant to the Shoalhaven Local Environmental Plan 2014 (SLEP). It was also an agreed fact that the whole of the Subject Land was classified as prime crop and pasture land as defined by the SLEP.
2. The Subject Land had an area of 18.26ha. The Appellant uses the Subject Land for the purposes of a horse breeding and training establishment. In addition to the horse infrastructure there is a dwelling house situated on the Subject Land.
3. On 22 March 2018, the Appellant lodged the DA. The DA proposed to subdivide the Subject Land into two lots: Lot 61 with an area of 10.55ha which would include the dwelling house; and Lot 62 with an area of 7.71ha. It was proposed that development consent would be granted to permit each lot to be used independently as a horse breeding and training establishment, which was permissible with consent in the RU1 zone.
4. On 14 September 2018, the Council refused development consent for a proposed animal (equine) breeding and training centre and two lot rural subdivision for commercial purposes at the Subject Land. The Appellant sought a s 8.2 review of that decision and the refusal of the DA was confirmed.
5. On 6 November 2018, the Appellant appealed the refusal to this Court.
6. After the hearing of the appeal on 28 February 2020 Commissioner Chilcott refused to grant the development consent and dismissed the appeal. The Commissioner's reasons for refusal, as set out in his decision turned on the application of the provisions of the SLEP to the proposed subdivision: Clarke v Shoalhaven City Council [2020] NSWLEC 1085.

Grounds of appeal

1. The Amended Summons identifies eight grounds of appeal. The Appellant did not press Ground 8 at the hearing. Of the remaining seven grounds the parties approached the matter by grouping the matters for determination generally in the following manner: 1. The Commissioner erred in the proper construction of the provisions of the SLEP in so far as he determined that notwithstanding that the DA relied upon the provisions of cl 4.2E of the SLEP it was also necessary that the DA satisfy the provisions of cl 4.2B of the SLEP: Grounds 1-4; 2. In the consideration of the requirements of cl 4.2E the Commissioner: 1. failed to take into account a mandatory relevant consideration being the personal circumstances of the Appellant's ongoing operation of the present use of the Subject Land; and 2. took into account a matter for which there was no evidence, namely that the Appellant did not propose to continue the present use on proposed Lot 61: Grounds 5-7.
2. The parties agreed that to the extent that the Commissioner also considered cl 4.2 of the SLEP that such provision was not necessary to be considered for the purposes of this appeal except to the extent that such provision assisted in the proper construction of the SLEP.
3. It was accepted by the Appellant that it could only succeed in this appeal if it was established that the Commissioner committed all of the particularised errors. If he failed to establish that one of the errors was made then the balance of the errors asserted, even if accepted, were insufficient to vitiate the Commissioner's decision such that the appeal would be dismissed: Guideline Drafting & Design v Marrickville Municipal Council (1988) 64 LGRA 275 at 280.

Proper construction of the SLEP: application of cl 4.2B and relationship to cl 4.2E

1. This ground of appeal requires a determination of the proper construction of the SLEP in order to determine whether the DA required compliance with both cl 4.2B and cl 4.2E. The parties accept that if cl 4.2B applies the DA is incapable of satisfying that requirement as there is no configuration of a two lot subdivision of the Subject Land that would permit each lot having a minimum area of 10ha of prime crop and pasture land.
2. The approach to construction of an environmental planning instrument is the same as the ordinary rules of construction of legislation: Environment Protection Authority v Grafil Pty Ltd; Environment Protection Authority v Mackenzie (2019) 101 NSWLR 245 at [256]-[274].
3. The ordinary principles of statutory construction require that the instrument as a whole is to be considered in the process of construction and a construction that meets the object and purpose of the instrument is to be preferred to one that does not.
4. For the purpose of this appeal the context of the whole of the SLEP was addressed by each party, however, focus was placed upon the following particular provisions of the SLEP: 2.6 Subdivision - consent requirements (1) Land to which this Plan applies may be subdivided, but only with development consent. … 4.1 Minimum subdivision lot size (1) The objectives of this clause are as follows - (a) to ensure that subdivision is compatible with, and reinforces the predominant or historic subdivision pattern and character of, an area, (b) to minimise any likely impact of subdivision and development on the amenity of neighbouring properties, (c) to ensure that lot sizes and dimensions are able to accommodate development consistent with relevant development controls. (2) This clause applies to a subdivision of any land shown on the Lot Size Map that requires development consent and that is carried out after the commencement of this Plan. (3) The size of any lot resulting from a subdivision of land to which this clause applies is not to be less than the minimum size shown on the Lot Size Map in relation to that land. … 4.2B Subdivision of certain land in Zone RU1, Zone RU2, Zone RU4, Zone R5 and Zone E4 (1) This clause applies to land in the following zones - (a) Zone RU1 Primary Production, (b) Zone RU2 Rural Landscape, (c) Zone RU4 Primary Production Small Lots, (d) Zone R5 Large Lot Residential, (e) Zone E4 Environmental Living. (2) Despite clause 4.1, land identified as prime crop and pasture land in a zone to which this clause applies may only be subdivided if the consent authority is satisfied that each lot created by the subdivision will contain at least 10 hectares of prime crop and pasture land. … 4.2E Exceptions to minimum subdivision lot sizes for certain rural and environment protection zones (1) The objective of this clause is to permit the subdivision of land in certain rural and environment protection zones to create lots of an appropriate size to meet the needs of current permissible uses other than for the purpose of dwelling houses or dual occupancies. (2) This clause applies to land in the following zones - (a) Zone RU1 Primary Production, (b) Zone RU2 Rural Landscape, (c) Zone E2 Environmental Conservation, (d) Zone E3 Environmental Management. (3) Land to which this clause applies may, with development consent, be subdivided to create a lot of a size that is less than the minimum size shown on the Lot Size Map in relation to that land, if the consent authority is satisfied that - (a) the land will not be used for the purposes of a dwelling house or a dual occupancy, and (b) the land will continue to be used for the same purpose for which it was lawfully used immediately before the subdivision. (4) The lot may include land from more than one zone. (5) Development consent must not be granted for the subdivision of land to which this clause applies unless the consent authority is satisfied that - (a) the subdivision will not adversely affect the use of the surrounding land for agriculture, and (b) the subdivision is necessary for the ongoing operation of the permissible use, and (c) the subdivision will not cause or increase rural land uses conflict in the locality, and (d) the subdivision is appropriate having regard to the natural and physical constraints affecting the land. (6) A lot created under subclause (3) that has a dwelling house or dual occupancy on it may also be less than the minimum size shown on the Lot Size Map in relation to that land.

Appellant's submissions

1. The Appellant submitted that the relevant provisions of the SLEP operated to set the minimum lot size by cl 4.1 and thereafter, in the subsequent clauses provided exceptions to that lot size requirement. Each of the exceptions provided different pathways to approval for a subdivision that did not comply with the lot size fixed by cl 4.1. In this case, the relevant pathway was cl 4.2E as the subdivision related to the needs of current permissible uses other than for the purpose of dwelling houses or dual occupancies which was the specific subject matter that cl 4.2E was directed. If the specific pathway was a route available to obtain consent, then that clause was the one that applied to the DA to the exclusion of all others.
2. The independent operation of the two clauses was demonstrated by the fact that cl 4.2B is in express terms to operate despite clause 4.1 whereas it is not expressed to operate to override the operation of any other clause including cl 4.2E.
3. Further, if cl 4.2B and cl 4.2E were to be sought to be applied concurrently there was a fundamental conflict between the two provisions as cl 4.2B was directed to prevent the construction or retention of dwelling houses whereas cl 4.2E specifically permitted the retention of existing dwelling houses. Where such conflict exists primacy should be given to the more specific clause rather than the general clause: Smith v The Queen (1994) 181 CLR 338 at 348. In this case, the specific clause is cl 4.2E as it makes express provision for dwelling houses and cl 4.2B does not.
4. Such a potential for conflicting provisions within the SLEP exceptions to the minimum lot size is demonstrated by the conflicting provisions relating to dwelling houses on lots in cl 4.2 and cl 4.2E.
5. For those reasons, the Commissioner should have found that the provisions of cl 4.2B and cl 4.2E operated independently of each other. Where there was a pathway to approval available under cl 4.2E it was an error for the Commissioner to also require satisfaction with the provisions of cl 4.2B.

Council's submissions

1. The provisions of the SLEP should be construed as providing for controls relating to the subdivision of land, not independent "exceptions" to the minimum lot sizes provided for in cl 4.1. Whilst such control may operate to vary the requirement to comply with the minimum lot size they should not all be characterised as being "pathways" to an approval.
2. In cl 4.2B the language used is expressed in restrictive language in so far as it states that land may only be subdivided. The balance of the clauses (including cl 4.2E) are permissive in the language used, such as, for example, development consent may be granted. This restrictive language indicates an intention that the clause is to operate as an essential condition of a valid subdivision application where the factual preconditions for the operation of that clause are present: David Grant & Company v Westpac Banking Corporation (1995) 184 CLR 265 at 276-277; Grant Samuel Corporate Finance Pty Ltd v Fletcher (2015) 254 CLR 477 at [22].
3. The focus of the Appellant on the words despite cl 4.1 are misplaced. The term "despite" when used in the sense of cl 4.2B is merely intended to convey that the clause operates irrespective of whether the provisions of cl 4.1 are met or not: Coshott v Prentice (No 2) [2017] FCA 394 at [4].
4. There is no conflict or ambiguity in the application of the clear and ordinary meaning of the word used in cl 4.2B and an application of its terms is consistent with the purpose and aims of such a provision to dictate the manner in which prime crop and pasture land is dealt with by contrast to land not so designated.
5. Even if there were a conflict of the type identified by the Appellant (which was denied) there is no foundation for finding that cl 4.2E is a specific clause and cl 4.2B is a general clause. They are both clauses that would be characterised as specific. The primacy between these two provisions is not to be determined by reference to the specific subject matter of the clause but rather its context in the instrument. In this case, the instrument makes it plain that the size of prime crop and pasture land cannot be varied as is made plain by cl 4.6(8)(bb) of the SLEP which excludes that clause from being varied.
6. There is no real conflict as cl 4.2B should not be read as intending to deal with dwelling houses or any other purpose other than the preservation of prime crop and pasture land.
7. If there were conflict the task of construction is to approach it on the prima facie basis that the provisions of an instrument such as the SLEP is intended to operate harmoniously. Where conflict arises a construction that permits the harmonious operation of the conflicting provisions is to be sought: Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at [70].
8. In this case, the purported conflict can be harmoniously resolved by the two clauses operating concurrently - as the clauses are each limited to specific factual circumstances and where the two factual circumstances are concurrently present the minimum extent of any variation permitted under cl 4.2E is one where each proposed lot contains not less than 10ha of prime crop and pasture land. This construction allows each clause to operate without there needing to be any change in language or operation - the words in each clause are merely applied in accordance with the stated requirements of each provision.

Findings on construction of the SLEP: application of cl 4.2B and relationship to cl 4.2E

1. I accept the submissions of the Council outlined above at [24]-[31] and for those reasons and for the reasons that follow I find that the Commissioner did not err in the application of the SLEP to the DA as the SLEP does require the DA to meet the requirements of both cl 4.2B and cl 4.2E in order that it may be approved.
2. When the SLEP is considered as a whole it is apparent that the development standards that relate to lot size are of two types, permissive and restrictive. The clauses that are permissive permit a variation to the restrictive provision in cl 4.1 (the minimum lot size determined by reference to the lot size map). However, the restrictive provisions operate in accordance with their terms as essential conditions that must be met in order for a consent to be granted for subdivision. There are two relevant restrictive provisions that relate to subdivision, cl 4.1 and cl 4.2B. The language of each of these clauses identifies a factual circumstance that must be present to enable a consent to be granted, should that factual circumstance not be present then consent cannot be granted.
3. There is a capacity to overcome the operation of a restrictive provision where a permissive provision specifies the circumstances that must be met to overcome the restriction. For the purposes of clause 4.1 such a restriction can be overcome either by identifying an expressed permission (such as by cl 4.2E) or by application of the power to vary development standards in cl 4.6. This capacity to vary the operation of cl 4.1 is identified in express terms by the language used in such permissive clauses.
4. However, cl 4.2B is also a restrictive provision and it operates independently of cl 4.1 in express terms. Therefore, the restriction will apply unless the SLEP makes a provision that would overcome the need for compliance. In this case, the SLEP does not make such provision. The capacity to vary a development standard as provided for in cl.4.6 is expressly excluded from operation with respect to cl 4.2B. Further, there is no other clause relating to subdivision (or otherwise applicable) that by its language would overcome the operation of the restriction imposed by this clause, including the terms of cl 4.2E. Therefore, on a proper construction of the SLEP if the essential condition required by cl 4.2B, being the size of the prime crop and pasture land in each lot, is not met there is no power to approve the DA.
5. This construction of the SLEP is not altered by reliance upon the opening words of cl 4.2B that express it to operate despite clause 4.1. The reference to clause 4.1 is to indicate that even if the provisions of that clause are complied with it is necessary that where the subdivision relates to land that is prime crop and pasture land each of the proposed lots must contain a minimum of 10ha of such defined land. The clause is not dictating lot size per se but the characteristic features of such a lot irrespective of its size.
6. The fact that cl 4.2B does not also expressly exclude the operation of cl 4.2E does not indicate that cl 4.2E was intended to be an exception to the operation of cl 4.2B. When the terms of cl 4.2B are read as a restrictive clause, as it was intended, there is no need to refer to any other clause other than cl 4.1 as cl 4.1 is the only clause that is restrictive and to which there may arise a conflict. Clause 4.2B does not provide a pathway to consent but creates a barrier to consent. The permissive clauses deal only with lot size and not the quantity of prime crop and pasture land and therefore, do not remove the requirement for compliance with that clause.
7. When construed in accordance with the words used in each clause there is no apparent conflict. The two clauses can operate harmoniously, to establish the separate but concurrent circumstances in which consent for subdivision can be approved. Each of the factors in a clause such as cl 4.2B and cl 4.2E must be present. There is no conflict as between those circumstances as the subject matter that is the focus of the clauses does not overlap.
8. To the extent that it was submitted that a conflict arises from the two clauses dealing differently with the same subject matter being dwelling houses that submission is not borne out on a construction of the SLEP. There is no textual or contextual basis, either express or implied, that would indicate that cl 4.2B is intended to deal with dwelling houses. Further, as was observed above, the clause deals not with lot size but the minimum amount of a certain type of land in each lot, such that it does not and could not on its terms have any application to the minimum lot size for a dwelling house (existing or proposed).
9. Accordingly, the Commissioner did not err in determining the appeal on the basis that the provisions of cl 4.2B operated concurrently with the provisions of cl 4.2E. The DA could not be granted unless both clauses were satisfied. As it was an agreed fact that the proposed subdivision could not satisfy cl 4.2B the Commissioner had no alternative but to refuse the DA. Grounds 1-4 of the appeal therefore must fail.

Grounds 5-7

1. As the Appellant accepted, unless he was successful on all of the grounds of appeal his appeal could not succeed. As I have determined that the Commissioner was not in error in the application of cl 4.2B to the DA the appeal cannot succeed and it is therefore unnecessary for me to determine the balance of the grounds of appeal.

Conclusions

1. For the reasons outlined above, the Commissioner did not err in the application and construction of the SLEP and therefore, the Commissioner did not have power to approve the DA even if it did comply with the provisions of cl 4.2E. Accordingly, the appeal must be dismissed.
2. The parties agreed that the costs of the appeal should follow the event. As the Appellant has been unsuccessful in the appeal he will be ordered to pay the Council's costs of the appeal.

Orders

1. The Court orders that: 1. The time for filing the Summons commencing the appeal under UCPR r 50.3(1)(a) is extended under UCPR r 50.3(1)(c) to 6 August 2020; 2. The appeal is dismissed; and 3. The Appellant is ordered to pay the Respondent's costs of the appeal.

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