HPG Mosman Projects Pty Ltd v Mosman Municipal Council [2021] NSWLEC 1243 | Case summary

Land and Environment Court (NSW)|2021-04-30|Before: Danks Street P

The applicant's written request to contravene the height of buildings development standard

The first opinion of satisfaction required by cl 4.6(4)(a)(i) is that the applicant's written request seeking to justify the contravention of a development standard has adequately addressed the matters required to be demonstrated by cl 4.6(3) (see Initial Action at [15]), as follows: (a) that compliance with the development standard is unreasonable or unnecessary in the circumstances of the case, and (b) that there are sufficient environmental planning grounds to justify contravening the development standard
The applicant bears the onus to demonstrate that the matters in cl 4.6(3) have been adequately addressed by the written request in order to enable the Court, exercising the functions of the consent authority, to form the requisite opinion of satisfaction (Initial Action at [25]). The consent authority has to be satisfied that the applicant's written request has in fact demonstrated those matters required to be demonstrated by cl 4.6(3) and not simply that the applicant has addressed those matters (RebelMH Neutral Bay Pty Limited v North Sydney Council [2019] NSWCA 130 at [4]).
The common ways in which an applicant might demonstrate that compliance with a development standard is unreasonable or unnecessary are summarised by Preston CJ in Wehbe v Pittwater Council (2007) 156 LGERA 446; [2007] NSWLEC 827 (Wehbe) at [42]-[51] and repeated in Initial Action at [17]-[21]:

the objectives of the development standard are achieved notwithstanding non-compliance with the standard;
the underlying objective or purpose of the development standard is not relevant to the development, so that compliance is unnecessary;
the underlying objective or purpose would be defeated or thwarted if compliance was required, so that compliance is unreasonable;
the development standard has been abandoned by the council;
the zoning of the site was unreasonable or inappropriate so that the development standard was also unreasonable or unnecessary (note this is a limited way of establishing that compliance is not necessary as it is not a way to effect general planning changes as an alternative to strategic planning powers).

Whether the proposal is in the public interest because it is consistent with the objectives of the contravened development standard and the zone

The second opinion of satisfaction in cl 4.6(4)(a)(ii) is that the proposed development will be in the public interest because it is consistent with the objectives of the development standard that is contravened and the zone objectives. The consent authority must be satisfied that the development is in the public interest because it is consistent with these objectives, not simply that the development is in the public interest (Initial Action at [27]). The consent authority must be directly satisfied about the matters in cl 4.6(4)(a)(ii) (Initial Action at [26]).
The objective for the height of buildings development standard for the business zones, at cl 4.3(1)(b)(ii) of LEP 2012, "to provide opportunities for buildings of a greater height than existing development in suitable locations to achieve the Council's residential strategy and provide opportunities for economic growth", is not an end in itself that can be applied to the proposed development (see Wehbe at [43] and Baron Corporation Pty Limited v Council of the City of Sydney (2019) 243 LGERA 338; [2019] NSWLEC 61 at [49]). This objective is explanatory of the central purpose of the increased numerical values for the height of buildings development standard in business zones, when compared to the height of existing development, to provide opportunities to achieve the Council's residential strategy, which is to increase the supply and diversity of housing in the local government area.
The latest iteration of the Mosman Local Housing Strategy (the Housing Strategy), which postdates LEP 2012, identifies that Council's "long-established land use housing approach expressed in [LEP 2012] has been to focus additional housing within medium density zones close to public transport, infrastructure, shops and services … and maintain housing diversity", and this approach remains valid (Ex 2, tab 49, f 434). The Housing Strategy includes the following statement regarding land use opportunities in the business zones, at f 462: "There are a number of sites within the Cremorne Junction and Mosman Junction local centres, and within the Military Road Corridor Business Centre, with available capacity for additional housing. Residential development is permitted within all Mosman business zones as part of a mixed use development, for example, ground floor commercial or retain premises with dwellings above street level. The scale of development permitted is dependent upon the zone of the land…"
The other objective for the height of buildings development standard is to "ensure that buildings are compatible with the desired future character of the area in terms of building height and roof form and will produce a cohesive streetscape".
The "desired future character of the locality" at cl 4.3(1)(b)(i) is undefined by LEP 2012. As an objective of the height of buildings development standard, the desired future character of the locality is intended to establish building heights for development that is compatible with that character. The desired future character of the locality can be evaluated by reference to matters other than the development standards that determine the building envelope for the site, including the existing development that forms the built context of the site (Woollahra Municipal Council v SJD DB2 Pty Limited [2020] NSWLEC 115 (SJD DB2) at [54]). The desired future character of an area is not determined and fixed by the applicable development standards for height and FSR, because they do not, alone, fix the realised building envelope for a site. The application of the compulsory provisions of cl 4.6 further erodes the relationship between numeric standards for building envelopes and the realised built character of a locality (SJD DB2 at [62]-[63]). Development standards that determine building envelopes can only contribute to shaping the character of the locality (SJD DB2 at [53]-[54] and [59]-[60]).
I am satisfied that the proposal is consistent with the desired future character of the locality for the following reasons:

The proposal is compatible with the height and roof form of existing buildings and provides a cohesive streetscape because the design is highly responsive to the context of the site, which includes the two-storey street wall of Mosman Junction and the nearby three and four-storey residential development in the residential zone;
The uppermost level of the proposal is suitably recessive so that the proposal does not present as a four-storey building, but presents as a two and three-storey form when viewed from Avenue Road, with a recessed fourth level;
The two-storey street wall fronting Avenue Road reinforces the two-storey street wall of Mosman Junction and interprets and responds to the retained portion of the contributory item without being pastiche;
The colonnade fronting Carney Lane is responsive to the network of promenades and laneways identified as important pedestrian access ways by Pt 4 of DCP 2012;
The proposal provides a suitable interface to the Raglan Street carpark and does not significantly interfere with the future development of the carpark as envisaged by Pt 4 of DCP 2012;
The proposal is an infill building that enhances and complements the existing urban character of Mosman Junction and its form is appropriate to the location and context of the site behind the street wall of Military Road; and
The expression of the built form successfully combines the retail/commercial uses of the Ground Level and the residential character of the upper levels.

Consideration

I am satisfied that the proposal is consistent with the urban design and planning objectives for the Mosman Junction Business Centre for the reasons set out above in relation to the proposal being consistent with the desired future character of the locality.
In oral evidence, Mr Wells was not critical of the landscaped area to the south of the proposed building being less than 3m wide per se, and expressed his concern as being more about the overall building envelope being "pushed up" to locate floor space on the uppermost level as a penthouse unit. I am satisfied that the building envelope of the proposal is an appropriate response to the opportunities and constraints of this site and the applicable planning objectives for the development of this site.

Conclusion

I accept the evidence of the applicant's heritage consultant, James Phillips (Ex V), that the proposal, including the partial retention of the building identified as contributory to the HCA, has an acceptable impact on the heritage significance of the HCA, pursuant to cl 5.10(4) of LEP 2012, because it presents a cohesive and integrated design solution as an addition to the historic streetscape of the HCA.

Conditions

The objector's concerns are addressed by condition 23 requiring a dilapidation report for the adjoining properties to be prepared.
The parties agreed on the amended wording of condition 24 to note that no approval is granted by this consent for rock anchors on adjoining properties.
The parties disagreed on the terms of condition 104. The Council sought a requirement that an application for construction works on Council's property, Carney Lane, be approved prior to the issue of an Occupation Certificate. The applicants submitted that this condition gives the Council an opportunity to frustrate the issuing of the certificate because the condition requires the Council's approval prior to the issuing of the certificate. I concur with the submission. The condition requires the applicants to carry out the works on Council property within 12 months from Council's approval, or prior to the issue of any Occupation Certificate, whichever is the latter.

Orders

The orders of the Court are: 1. The applicants are granted leave to amend the application to rely on the documents tendered as Exhibit A. 2. The appeal is upheld. 3. Development Application No. 8.2020.25.1 for the retention of a portion of one building at 171 Avenue Road, Mosman, the demolition of remaining structures, and construction of a new four-storey shop top housing development, comprising 4 retail tenancies and 11 residential units and basement parking, at 171, 173 and 175-179 Avenue Road, Mosman, is approved, subject to the conditions of consent at Annexure A. 4. The exhibits, other than 1 and A, are returned.

Amendments 25 June 2021 - Corrected typographical errors in paragraphs [25] and [26]. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 25 June 2021

The proposal complies with the FSR development standard

For the purpose of the FSR calculation, the applicants rely on the FSR calculation plan DA500 Issue G (Ex A, tab 1). The GFA identified on the FSR calculation plan gives a FSR of 1.99:1, which complies with the FSR development standard of 2:1.
The Council's planning expert disagreed with the calculation of the GFA, on the basis that part of the common corridors on Levels 1 and 2 are excluded from the calculation of the GFA.
The common corridors on the two levels are the areas of horizontal circulation from which all the units on that level, the fire stair and lift are accessed. The corridors are long, each with an opening on one side less than half the length of the corridor, which includes a planter 1m high as a barrier. The same opening on Level 3 is enclosed with a window. If the openings on Levels 1 and 2 were enclosed with windows, the corridors would be internal spaces and the area of the corridors, measured from the internal face of the external walls, would contribute to the GFA.
The FSR calculation plan excludes the areas of the corridors on Levels 1 and 2 opposite the opening, and this area is identified on the plans on each level as a "breezeway".
According to Mr Wells, the breezeways should be included in the calculation of the GFA because, "the lobby areas are covered at roof level by a roof that projects more than 2m from the outer edge of the lobby areas, providing cover and protection from the elements. The lobby areas are more than 10m from the side boundaries, at the innermost end of a 6m wide recessed section of the proposal … These factors increase the tendency for the lobby areas to be read as part of the overall building envelope. There is insufficient visual relief to qualify the lobby areas from gaining dispensation from the definition of GFA."
I agree with Mr Wells' sentiment that the GFA of the breezeways contribute to the volume of the building envelope, however, the calculation of GFA must be consistent with the definition of GFA in the Dictionary of LEP 2012. Floor space ratio is an inexact measure of a building's volume, because it excludes all the volumes of all areas identified in the definition of gross floor area at (d)-(j), including internal voids and inset (recessed) balconies with an outer wall less than 1.4m high.
The difference between the parties turns on the definition of GFA, particularly the phrase "measured from the internal face of external walls". The Council relied on Landmark Group Australia Pty Ltd v Sutherland Shire Council [2016] NSWLEC 1577 (Landmark Group) at [36] and [59]. The applicants relied on the interpretation of "external walls" in GGD Danks Street P/L and CR Danks Street P/L v Council of the City of Sydney [2015] NSWLEC 1521 (GGD Danks Street) at [31]. There is no definition of "external wall" in LEP 2012. The definition of GFA excludes terraces and balconies with outer walls less than 1.4m high. There is no dictionary definition of the phrase, "external walls".
The units of the proposal are a Class 2 building under the National Construction Code (NCC). The definition of "external wall" in the NCC is "an outer wall of a building which is not a common wall" (Sch 3 to Vol 1 of the NCC). I adopt this meaning of "external wall" as the ordinary meaning of the term in the absence of a definition of the phrase in LEP 2012. Although the definitions of the NCC are not referenced by LEP 2012 or by the EPA Act, the Building Code of Australia (Vols 1 and 2 of the NCC) is referred to by Pt 6 of the EPA Act. An outer wall of a building is either the façade that forms the building envelope or an external wall that is the threshold between an internal room and an external space.
For the same reason as the explanation given in GGD Danks Street at [31], the walls of the corridors on Levels 1 and 2 of the proposal are external walls. The breezeways, or corridors, are external spaces because they function in the same way as an inset balcony and the opening has an outer wall less than 1.4m high. An inset balcony requires the three enclosing façades of the balcony to be external walls, to create an internal or habitable space internally. The extent of the roof overhangs over the planters may keep the corridors dry during inclement weather but they do not render the corridors internal spaces. The communal corridors on Levels 1 and 2 are external spaces and the walls lining the corridors will have to be external walls in order to make the units adjoining the corridor habitable space, unless a window is added to the openings on Levels 1 and 2. For this reason, it is my view that the walls of the corridors are external walls and the area of the corridors therefore does not contribute to the GFA.
I respectfully disagree with the finding in Landmark Group because the corridor was unenclosed and was an external space. The test is not the "prospect of rain entering the breezeway" or whether the external space is identified as a breezeway or a corridor (at [36]). For the units adjoining the corridor to each be a dwelling, they must be enclosed on all sides by external walls or common walls. As the corridor was open at each end, the side walls of the corridor had to be external walls to the units on either side of the corridor.
I understand the Council's cynicism in relation to the practice of creating horizontal circulation spaces in multi-residential developments which are external spaces by dint of the deletion of a window in an opening or an open ended corridor, in order that the spaces do not contribute to the calculation of the GFA, however, the calculation of GFA has to be consistent with the LEP definition. The definition of GFA should be clarified or amended so that common horizontal circulation in multi-residential developments, such as corridors or breezeways, is explicitly included in the definition of GFA.
On the basis of the definition of GFA in LEP 2012, the area of the breezeways on Levels 1 and 2 of the proposal do not contribute to the calculation of GFA and the proposal complies with the FSR development standard.

Contravention of the height of buildings development standard

According to Mr Wells, the maximum height of the proposal is 13.5m at the top of the acoustic screen to the services on the roof of the proposal. The corners of the roof of the uppermost level of the proposal are 12.52m at the south-western corner and 12.15m at the north-eastern corner. The height of buildings development standard for the site is 11m.
The applicants provided a written request seeking to justify the contravention of the height of buildings development standard prepared by Longitude Planning Pty Ltd and dated 9 April 2021 (Ex A, tab 4).
Clause 4.6(4) of LEP 2012 establishes preconditions that must be satisfied before a consent authority or the Court exercising the functions of a consent authority can exercise the power to grant development consent (Initial Action Pty Ltd v Woollahra Municipal Council (2018) 236 LGERA 256; [2018] NSWLEC 118 (Initial Action) at [13]). The consent authority must form two positive opinions of satisfaction under cl 4.6(4)(a). As these preconditions are expressed in terms of the opinion or satisfaction of a decision-maker, they are a "jurisdictional fact of a special kind", because the formation of the opinion of satisfaction enlivens the power of the consent authority to grant development consent (Initial Action at [14]). The consent authority, or the Court on appeal, must be satisfied that the applicant's written request has adequately addressed the matters required to be addressed by cl 4.6(3) and that the proposal development will be in the public interest because it is consistent with the objectives of the contravened development standard and the zone, at cl 4.6(4), as follows: (4) Development consent must not be granted for development that contravenes a development standard unless: (a) the consent authority is satisfied that: (i) the applicant's written request has adequately addressed the matters required to be demonstrated by subclause (3), and (ii) 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, and (b) the concurrence of the Secretary has been obtained.
On appeal, the Court has the power under cl 4.6(2) to grant consent to development that contravenes a development standard without obtaining or assuming the concurrence of the Secretary of the Department of Planning and Environment, pursuant to s 39(6) LEC Act, but should still consider the matters in cl 4.6(5) of LEP 2012 (Initial Action at [29]).

(2019) 243 LGERA 338

(2018) 236 LGERA 256

(2007) 156 LGERA 446

HPG Mosman Projects Pty Ltd v Mosman Municipal Council

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