Hammersmith Management Pty Limited v Lake Macquarie City Council

7 As noted above, the Northlakes Urban Release Area, which includes the applicant's land, comprises some 423 hectares. In addition to rezoning the applicant's land and other land within the area for urban purposes, Amendment No. 112 to the LEP zones a corridor of land along a creek known as Cocked Hat Creek as 6(c) Open Space, the primary purpose being for conservation purposes. In order to reflect its primary use the council proposed a change in the zoning of the corridor to 7(2) Conservation (Secondary) in the draft Local Environmental Plan 2001. It is convenient to refer to this as the conservation corridor. The Contributions Plan 8 On 11 December 2000 the council adopted Lake Macquarie Section 94 Contributions Plan No. 2 - Northlakes ("the contributions plan"). The plan applies to all land in the Northlakes Urban Release Area. The plan covers contributions for a variety of public amenities and public services, such as community facilities, roadworks and traffic management, drainage, storm water and water quality control. I refer only to those parts of the plan which relate to open space and recreation, and conservation. 9 Chapter 3 of the Plan is headed "Open Space & Recreation". Section 3.2 states: 3.2 Nexus Causal: The open space and recreation facilities within the surrounding area are adequate only to service the existing population. Given the estimated projected growth, the current facilities are not adequate to provide for the anticipated future population of the Northlakes Urban Release Area. It is therefore reasonable for Council to require developments which increase the population within the release area to contribute towards the provision of additional open space and recreation facilities. This plan details the open space and recreation facilities which are required as consequence of anticipated development within the release area. … 10 Section 3.3 is headed "Recreation Facility Provision" and specifically refers to the conservation corridor. Section 3.3.1 states: 3.3.1 Open Space Land for Recreation The acquisition of open space is based on the need to provide passive recreation areas as well areas for recreation facilities for the anticipated resident population of the Northlakes Urban Release Area. The Lake Macquarie Section 94 Contributions Plan No, 2 - Northlakes (Amended 4 May 1998), included provision for the collection of Section 94 contributions for a central corridor of open space following the main tributary of Cocked Hat Creek. This previous version of the plan stated that the central corridor of open space was predominantly devised to provide passive recreation throughout the Northlakes Urban Release Area. In actual fact this corridor was devised primarily for conservation purposes. In particular it was designed to provide an adequate buffer to Cocked Hat Creek to maintain integrity of the creek. This is reflected in the proposed 7(20 Conservation (secondary) zoning of the corridor under Draft Lake Macquarie Local Environmental Plan 2001. The corridor has therefore been excluded from the open space acquisition component of this plan but has been included in the conservation component of the plan. This is discussed in detail in Chapter 5. The open space land acquisition requirements for recreation provision directly generated by residential development within the Northlakes Urban Release Area can be found in the schedule of works attached as Appendix A. 11 The reference above to Chapter 5 appears to be an error: the conservation component of the plan is discussed in detail in Chapter 6. I note that the schedule of works in Appendix A contains no reference to works within the conservation corridor. 12 As noted above, Chapter 6 is headed "Conservation". Section 6.1 states: 6.1 Background In December 1995, Council resolved that a draft LEP for the Northlakes Urban Release Area be prepared. The intent of this draft LEP was to rezone rural land within the release area to residential. The main tributary of Cocked Hat Creek which traverses the release area was identified for preservation and proposed to be zoned 6(c) Open Space (local reservation). This corridor also provided an important wildlife corridor, and was intended to provide recreation facilities. The subsequent amendment (amendment No. 102) to the LEP was gazetted on 18 October 1996. The Draft Lake Macquarie Local Environmental Plan 2001 currently on public exhibition proposes a change in zone to 7(2) Conservation (Secondary) to reflect the primary use of this corridor. Council will acquire 365,900 m 2 of this corridor for a dual conservation/recreation purpose and will levy Section 94 contributions for its acquisition under this plan. 13 Section 6.2 purports to identify the causal nexus between the conservation corridor and development within the Northlakes Urban Release Area. It notes that this main tributary to Cocked Hat Creek was identified for open space as it exhibited greater species diversity than other creek lines which traverse the site. It is also stated that the corridor would provide the opportunity to establish internal pedestrian and cyclist management systems throughout the site. Section 6.2 then continues: Consequently, this corridor provides ecological conservation and passive recreation functions (in this case bushwalking, pedestrians, cycling, nature appreciation etc). The act of rezoning and subsequent development of the urban release area has generated the need to conserve this corridor and the benefit this provides to the release area is clearly established. Therefore, Council considers it reasonable to levy contributions on all development within the Northlakes Urban Release Area to acquire the corridor along Cocked Hat Creek to ensure that it is preserved in its present state. 14 I note that a cycleway is proposed within the conservation corridor as part of the roadworks and traffic management facilities within the contributions plan. 15 Section 6.4 states: 6.4 Apportionment The need to preserve the Cocked Hat Creek corridor will be generated by development of the site. Therefore, it is appropriate that development within the Northlakes Urban Release Area should be subject to the full cost of this land. 16 Appendix H shows that the total expenditure required to acquire and develop the conservation corridor is $7,334,466. I presume that the whole of this sum is sought to be obtained by way of contributions as conditions of consent for development within the Northlakes Urban Release Area. Other Evidence 17 I conclude from the text of the contributions plan that the primary purpose of the conservation corridor is conservation; but the corridor will also serve a secondary purpose of recreation. The latter purpose is demonstrated by, for example, the proposal within the contributions plan for a cycleway along the corridor. 18 The fact that the primary purpose of the conservation corridor is for the purpose of conservation is demonstrated by an internal memorandum from the council's Environmental Planner, Ms R Moroney, to the council's Section 94 Co-ordinator, Mr M J C Withers, dated 14 August 2001. That memorandum includes the following statement: The proposed 7(2) Conservation (Secondary) zone that extends along Cocked Hat Creek, Northlakes has a primary function as a conservation zone as opposed to "passive recreation". 19 In an internal e-mail on 15 August 2001 from Mr Withers to Ms S Thompson, a consultant of the council from ERA Australia Pty Limited, and to the council's computer services section, Mr Withers states: As discussed with you, the open space corridor (currently zoned 6(c) and zoned 7(2) in the preliminary draft LEP) in the current plan is contained in the recreation component of the plan, to be acquired for the purpose of passive recreation. The land was never intended for this purpose. … 20 In an internal memorandum dated 30 August 2001 from Mr Withers to the council's Manager Development Assessment and Compliance, Mr P Hodge, Mr Withers states: The Lake Macquarie Section 94 Contributions Plan No. 2 - Northlakes included provision for the collection of contributions for a central corridor of open space following the main tributary of Cocked Hat Creek. This version of the plan stated that the central corridor of open space was predominantly devised to provide passive recreation throughout the Northlakes Urban Release Area. The corridor was, however, devised primarily for conservation purposes. In particular it was designed to provide an adequate buffer to Cocked Hat Creek to maintain the integrity of the creek… 21 Evidence of the conservation value of the corridor was given for the council by Associate Professor P Adam of the School of Biological Sciences at the University of New South Wales. He referred to the alluvial tall moist forest along the corridor, the retention of which would add to visual amenity, provide an opportunity for passive recreation, maintain biodiversity and the provision of habitat for native fauna, and protect the water quality of Cocked Hat Creek. Mr M J Murray, an ecologist, also attested to the value of the conservation corridor as a habitat for native fauna. In cross-examination Professor Adam said that the conservation corridor is of more general value than to the residents of lot 104 (the applicant's land). He accepted the proposition that the value of this area is at least regional to the extent that it is of interest and value to all of the residents of Lake Macquarie. 22 Evidence also was adduced on behalf of the council to show that the conservation corridor was to serve the dual purpose of both conservation and recreation, but it was conceded by the council's witnesses that the primary purpose was conservation. An environmental engineer, Mr P J Jamieson, gave evidence of the value of the corridor in performing the function of a buffer zone or filter strip so as to preserve the water quality of the creek. I note, however that only a small part of the applicant's land (lot 104) drains into the corridor. Only 3.5 hectares of the total area of 129.1 hectares of lot 104 drains into the conservation corridor. None of that part of lot 104, which comprises the proposed subdivision of 37 lots which is presently before the Court, drains into the corridor. The Validity of the Contributions Plan 23 Dr G A Flick SC (with him Ms J M Jagot), appearing for the applicant, made the following submissions. The contributions plan is unlawful for either of two reasons: (1) conservation is not a purpose for which the power conferred by s 94 of the EP&A Act may be exercised; and (2) there was and is no nexus between the conservation corridor and the development within the Northlakes Urban Release Area, which will not and is not likely to require the provision of or increase the demand for such corridor. It is further contended that Ch 6 of the contributions plan is severable. 24 The fundamental question, therefore, is whether conservation amounts to a public amenity or a public service as referred to in s 94(1) of the EP&A Act. I accept Dr Flick's argument, which is consistent with the evidence, that the substantial purpose of the conservation corridor is conservation and not recreation. The provision of the recreational needs of the Northlakes Urban Release area are otherwise provided for in the contributions plan. Moreover, the need generated by the development for open space and recreation facilities is otherwise satisfied. There is no suggestion that conservation amounts to a public service within the meaning of s 94. I do not accept, however, the proposition that such a purpose cannot amount to a public amenity. It is self-evident that the conservation of biological diversity, the removal of nutrients and sediments in drainage runoff, the consequent protection of the water quality of Cocked Hat Creek, the preservation of alluvial tall moist forest and passive recreation fall squarely within the concept of an amenity. I thus reject the submission that conservation, and, in particular, the provision of the Cocked Hat Creek corridor, is a purpose which is outside the power conferred by s 94 of the EP&A Act. Moreover, in the present case it is conceded that people within the Northlakes Urban Release Area will derive some benefit from, or make use of, the conservation corridor. This concession provides the necessary nexus between the corridor and development within the surrounding area. I conclude therefore that there is no invalidity in the contributions plan. The Class 1 appeal 25 The conclusion confirming the validity of the contributions plan does not necessarily also determine the appeal against the imposition of the particular condition of consent in this case. Whilst the contributions plan may validly include contributions for the public amenity of a conservation corridor, the questions remain as to whether the particular development "will or is likely to require" the provision of such a corridor, or "increase the demand" for such a corridor, as required by s 94(1) of the EP&A Act. 26 In my opinion the answer to these questions is in the negative. I have come to this view for the following reasons: (i) No part of the proposed subdivision in the present case drains into the corridor, so that there is no question of drainage affecting the water quality of the creek. (ii) As stated by Mr H M Sanders, the planning consultant who gave evidence for the applicant, the need for the conservation of the land arises from its intrinsic characteristics, not by reason of the subject development. (iii) As stated by Associate Professor Adam, the corridor is of more general value to all the residents of Lake Macquarie, than to the residents of the subject land. (iv) No part of the development of the subject land involves the removal or disturbance of any equivalent alluvial tall moist forest which should otherwise be replaced. (v) All of the recreational and open space needs of the proposed subdivision have been otherwise met. (vi) It would not be reasonable, within the meaning of s 94(2) of the EP&A Act, to require the developer of the subject subdivision to contribute to the provision of a regional facility where the particular development does not require or increase the demand for that facility. (vii) Although the conservation corridor and the proposed cycleway within it may be used by residents of the proposed subdivision, there is no suggestion that this development creates a need or increase the demand for either facility. 27 Mr B J Preston SC (with him Mr D R Parry) appearing for the council, relies upon the judgment of Stein J in Parramatta City Council v Peterson (1987) 61 LGRA 286 (inter alia) in support of a submission that there need not to be a direct nexus between the development and the public amenity; and that it is sufficient if there would be a benefit, albeit not a direct one. In other words, it is said that if persons within the subdivision will benefit, then that is sufficient. 28 In Parramatta City Council v Peterson, a proposed commercial building in the Parramatta CBD created a need for additional parking. The question determined by Stein J was whether the site for a car park, nominated by the council, was so remote from the development that there could not be an identifiable nexus or a direct connection between them. Stein J held that this was not the test. His Honour then set out the passage upon which Mr Preston now relies (at 296): In my opinion the second test of whether the condition fairly and reasonably relates to the permitted development is not answered simply by geographical proximity but rather whether the development is benefited by the public amenity provided. There is no doubt that it must benefit, (as indeed will the Parramatta CBD as a whole), even though the benefit may not be a direct one (in terms of geographical proximity). 29 In my view Parramatta City Council v Peterson does not assist the council's arguments in this case. Stein J was concerned with the question of whether the development would be benefited by a car park which was not geographically proximate, in a case in which the development itself created a clear need for additional car parking. His Honour was concerned with whether s 94 required a geographical test, that is, whether a car park to serve the Parramatta CBD as a whole could reasonably relate to the need generated by the development. In the present case, however, the proposed development does not generate any need for the facility. As I have noted, the need for open space and recreational facilities generated by the development are otherwise satisfied. 30 It seems to me that it is not sufficient that residents of the proposed subdivision may conveniently make use of the conservation corridor. To use the words of s 94(1), it is necessary that the development "will or is likely to require" the provision of the conservation corridor, or will "increase the demand" therefor. That is, the section requires that development of the applicant's land must generate the need for the corridor. In the present case, unlike Parramatta City Council v Peterson, the development does not give rise to the need for the facility. In the absence of such a demonstrated need, the appeal in Class 1 of the Court's jurisdiction must be allowed. Moreover, absence of any demonstrated need suggests that the of condition is unreasonable, even if it is determined in accordance with the contributions plan, and so would not be allowed by the Court pursuant to s 94(2). Orders 31 In the Class 4 proceeding (No. 40045 of 2002) I make the following orders: 1. The application is dismissed. 2. The question of costs is reserved. 3. The exhibits may be returned. 32 In the Class 1 proceeding I make the following orders: 1. The appeal is allowed. 2. Condition 53(a) of the development consent is amended to read as follows: 53. (a) In accordance with the provisions of Section 94 of the Environmental Planning and Assessment Act 1979 and the Lake Macquarie Section 94 Contributions Plan No. 2 - Northlakes, the following monetary contributions shall be paid to Council for the purposes of: Open Space Acquisition $99,756.00* Recreation Facilities $72,144.00** Community Facilities Capital $46,620.00 Community Facilities Land $13,104.00 Roadworks and Traffic Management $120,348.00 Capital (Catchment 2) Roadworks and Traffic Management $7,092.00 Land (Catchment 2) Administration $10,184.00 TOTAL $369,248.00 * A contribution is not sought for item 12 in Appendix A -Road Corridor to Major Park & Sporting Area

** A contribution is not sought for item 7 In Appendix B - Development Precinct 5 relating to Road Construction to Major Park & Sporting Area 3. Condition 53A is added to the conditions of the development consent as follows: 53A If the Council (a) acquires part of lot 59 in DP 755262 for the construction of the facilities referred to in (b) and upon which the extended road referred to in (c) below is situate for the purposes of the Major Recreation Area in Appendix A Item 7 - Development Precinct 5, of the Contributions Plan; and (b) gives notice to the applicant that the Council intends to commence to construct within 12 months of the notice the recreation facilities on lot 59 listed in Appendix B Item 7 to the Contributions Plan, Then: (c) the applicant must within 3 months of receiving the notice submit to the Council for approval plans depicting the proposed construction on Dunbar Road extended as shown hatched on the plan annexed "A" hereto, to a country road standard with a gravel pavement 8 metres in width and a flush bituminous two coat seal 5.5 metres wide (but capable of carrying buses) with centre line marking and grass swale verges together with all ancillary road and drainage works required for the purposes of that road; and (d) the applicant must, within 6 months of receiving the approved plans from the Council and in accordance with the Council's approval, construct Dunbar Road extended as shown hatched on the plan "A" annexed hereto details of which are referred to in the preceding subparagraph (c). 4. The exhibits may be returned. I hereby certify that the preceding 32 paragraphs are a true copy of the reasons for judgment herein of the Honourable Mr Justice Lloyd.

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