Hurstville City Council v Goreski

Introduction 1This is an appeal pursuant to s 56A of the Land and Environment Court Act 1979 (' Court Act' ) against the decision handed down by Commissioner Brown on 1 October 2010 in matter 10/10557 - Goreski v Hurstville City Council [2010] NSWLEC 1288. 2There are also disputes to be resolved concerning (1) remittal of the matter (if the appeal succeeds), and (2) costs. 3Commissioner Brown upheld the Goreskis' class 1 appeal against Council's refusal of a Development Application ('DA' - No.09/DA 228) to demolish an existing dwelling, construct a two-storey dual occupancy, and subdivide the lot into two Torrens Title lots. At the time of the hearing of the class 1 appeal there was a s 82A application pending before the Council. 4The subject site is a residential block at 165 Carrington Avenue, Hurstville (No.165).

The Grounds of Appeal 5The summons commencing this appeal was filed on 28 October 2010 and stated the following four grounds of challenge to the Commissioner's decision:

1. Whether the Commissioner erred in finding that strict compliance with a development standard is unreasonable and [sic] unnecessary on the basis that dual occupancy developments are a permissible use on the site and the proposal satisfies all relevant development requirements with the exception of the requirement subject of the objection under State Environmental Planning Policy No 1 - Development Standards ("SEPP 1"): [29].
2. Whether the Commissioner erred in the assessment of the objection under SEPP 1 by failing to take into account the precedent effect of upholding the objection in his consideration of the objectives of the development standard.
3. Whether the Commissioner erred in his assessment of the objection under SEPP 1 by reversing the onus of establishing that the objection was well-founded: [26].
4. Whether the Commissioner erred in his determination of the objection under SEPP 1 in considering that the permissibility of the subject development effectively rendered the objection under SEPP 1 unobjectionable: [25]. 6At the hearing of the s 56A appeal on 11 February 2011, Mr Galasso, senior counsel for the appellant Council, argued the above four grounds of appeal in the order - 1, 4, 2 and 3 - and then dealt with the question of remittal. 7Mr McEwen, senior counsel for the Goreskis, conceded that the Council had successfully made good its case on ground 1. He then dealt, in order, with grounds 4 and 2, ignoring ground 3 because of his understanding that it was not pressed. Mr Galasso acknowledged that there was some dispute or confusion in correspondence about whether ground 3 was to be pressed. When the court's attention eventually turned to the question of costs, some relevant pre-hearing correspondence was tendered (as Exhibit G1). 8The Council's appeal submissions were filed on 20 January 2011. On 3 February 2011, the solicitors for the proponents (Bartier Perry - Mr Loether) wrote to the solicitors for the Council (Marsdens - Mr Seton) referring to those submissions, and offered, " without prejudice save as to costs ", as follows: Our clients agree to concede the matters contained in appeal ground number 1 of your Summons, on the basis that your client abandons appeal grounds number (sic) 2, 3 and 4. If agreed, the only remaining matter for determination at the hearing of this matter on 11 February 2011 is in relation to the Commissioner to whom the matter is to be remitted for re-hearing. Depending on your reply, we have instructed Counsel briefed for our clients to refrain from preparing written submissions ", which were due to be filed and served on 2 February. 9Marsdens replied on 7 February, advising that the Council would be prepared not to press ground 3, if the proponent agreed to concede grounds 1, 2 and 4. They also sought agreement by the Goreskis that any remittal ordered (if the appeal were allowed) be to a Commissioner other than Brown C. 10Mr Loether wrote back on 9 February 2011 serving the respondent's written submissions of that date: We are instructed that the Respondents concede matters contained in appeal ground number 1 of the Applicant's Summons filed 28 October 2010. Appeal grounds 2, 3 and 4 are not conceded. In an effort to avoid additional costs being incurred, please advise whether your client presses appeal grounds 2, 3 and 4 having regard to the matters raised in the attached Submissions. 11Marsdens replied later the same day: We are instructed that our client will not press appeal ground 3 at the hearing of the appeal on Friday 11 February 2011, but will require a determination by the Court in respect of appeal grounds 1, 2 and 4 . 12Conceding the ambiguity in regard to ground 3, Mr Galasso told the court (at T 11.02.11, p21, LL8-10): It does not stand as something that I need to rely upon on its own. In many respects, ground three is a (sic) embodied in the previous ground two, I say nothing more about that. 13At the hearing, Council persisted in seeking the remittal of the proceedings to a Commissioner other than Brown C, for rehearing and determination in accordance with the law.

The relevant documents 14It is agreed that most of the documents relevant for the court's consideration of the s 56A appeal are annexed to the affidavit of Jodie Anne McCullan sworn on 19 January 2011. 15They comprise:

• the Commissioner's judgment (Annexure 'A');
• the transcript of the hearing before him on 30 September 2010 (Annexure 'B');
• copies of Exhibits 1, 6, 7 and 3 tendered at that hearing: Exhibit 1 (Annexure 'C') is the Statement of Facts and Contentions filed by the Council on 17 August 2010. Exhibits 6 and 7 (Annexures 'D' and 'E') are joint reports of the planners filed on 22 and 23 September 2010; and Exhibit 3 (Annexure 'F') is the Plan of Subdivision (DP 8011) creating the subject site, relevantly Lot 14, now known as "No.165" Carrington Avenue, Hurstville. 16In addition to the correspondence to which I have referred above ( Exhibit G1 ), also before the court on this appeal are various plans and drawings of the proposed development ( Exhibit C1 ).

The Issues in the Proceedings 17No.165 occupies an area of 619.8m 2 , has a width of 15.645m, and is located in Zone No.2 (Residential Zone) under the Hurstville Local Environmental Plan 1994 ('HLEP 1994'). 18Under the relevant clause of the LEP (cl 8), the objectives of that zone are as follows: (a) to preserve and enhance the character and amenity of established residential areas, (b) to allow a variety of housing types within existing residential areas, (c) to encourage the conservation of residential areas which include individual buildings and streets of heritage significance, (d) to encourage greater visual amenity by requiring landscaping and permitting a greater variety of building materials and flexibility of design, (e) to enable redevelopment for medium density housing forms, including townhouses, villas, cluster housing, semi-detached housing, residential flat buildings and the like, where such development does not interfere with the amenity of surrounding residential areas, and (f) to allow people to carry out a reasonable range of activities from their homes, where such activities are not likely to adversely affect the living environment of neighbours. 19Dual occupancies, dwelling houses, multiple dwellings, residential flat buildings, residential offices, etc all require development consent under the table to cl 8, but dual occupancies are specifically dealt with in cl 11A of the LEP, and the relevant objectives of that clause are: (1) Notwithstanding any other provisions of this plan, the objectives of this clause are to: ... (d) provide a minimum allotment size and width required for the development of dual occupancies so that: (i) the pattern of subdivision in residential areas is retained as reflected in lot size, orientation and shape, and (ii) allotments have a minimum size so as to provide landscaped areas that are suitable for tree planting, and (iii) the scale and density of development is compatible with the existing streetscape. 20Clause 11A(2A) provides that " the minimum allotment size for the creation of a dual occupancy on land within Zone 2 is 630m 2 and the allotment must have a width of at least 15 metres ". No.165 is, therefore, of sufficient width, but insufficient area, to satisfy cl 11A(2A), so the DA required a dispensation under State Environment Planning Policy No.1 ('SEPP 1') to gain approval. 21The Aims and Objectives of SEPP 1 appear in cl 3: This Policy provides flexibility in the application of planning controls operating by virtue of development standards in circumstances where strict compliance with those standards would, in any particular case, be unreasonable or unnecessary or tend to hinder the attainment of the objects specified in section 5 (a) (i) and (ii) of the Act. 22Section 5(a) of the Environmental Planning and Assessment Act 1979 (' EPA Act' ) provides: The objects of this Act are: (a) to encourage: (i) the proper management, development and conservation of natural and artificial resources, including agricultural land, natural areas, forests, minerals, water, cities, towns and villages for the purpose of promoting the social and economic welfare of the community and a better environment, (ii) the promotion and co-ordination of the orderly and economic use and development of land. 23Under cl 5 of SEPP 1, the policy " prevails over any inconsistency between it and any other environmental planning instrument, whenever made ". 24Clause 6 makes clear that an invocation of the policy requires " a written objection that compliance with that development standard is unreasonable or unnecessary in the circumstances of the case , and specifying the grounds of that objection " (emphasis mine - c.f. appeal ground 1 quoted in [5] above). 25Clause 7 provides: Where the consent authority is satisfied that the objection is well founded and is also of the opinion that granting of consent to that development application is consistent with the aims of this Policy as set out in clause 3, it may, with the concurrence of the Director, grant consent to that development application notwithstanding the development standard the subject of the objection referred to in clause 6. 26The Goreskis lodged with the DA, and the class 1 appeal, a SEPP 1 objection, supplemented by various documentation. 27Commissioner Brown determined to uphold the class 1 appeal and, in doing so, upheld the objection. 28The focus of the grounds of this present s 56A appeal is the manner in which the Commissioner dealt with and upheld the SEPP 1 objection.

The hearing and judgment at first instance 29It is appropriate to set out in summary form the way in which the hearing before Commissioner Brown proceeded, and how he dealt with the case in his judgment. 30The parties indicated at the beginning of the hearing before Brown C some degree of common ground on various facts and contentions of the Council, draft conditions of consent, and other matters. Some of Council's contentions at the hearing below remain relevant to the appeal before me. 31Contention 1 concerned minimum site area, cl 11A(2A) of the LEP, and various provisions of the Hurstville Development Control Plan No.1 ('DCP') (s 4.2 cls 4.2.1.1 and 4.2.2.2) to the same effect: both instruments specify the area as 630m 2 . The Council contended before the Commissioner that the objection was not well founded, and did not demonstrate that compliance with the provisions of cl 11A(2A) was " unreasonable or unnecessary in the circumstances of the case ", or that compliance would tend to hinder the attainment of the objects specified in s 5 of the EPA Act . Contention 1(g) stated: The subject site has no special characteristics that distinguish it from other sites in the vicinity which are subject to the same requirements for dual occupancy developments, that would justify the non-compliance with the requirements of HLEP 1994. 32Contention 2 pointed out that the DA would not preserve and enhance the character and amenity of the established residential area, because the majority of allotments in the surrounding area have an area of less than 630m 2 . As a result, there are no dual occupancy developments presently in the vicinity of the subject site. A dual occupancy development would be inconsistent with the existing character of the area, which generally comprises single dwelling houses. 33Contention 3 drew attention to the objectives of cl 11A of the LEP, with which Council says the DA was inconsistent. Particular reference was made to cl 11A(1)(d) ([19] above), and pars (b) and (c) of contention 3 state: (b) The subdivision pattern of the surrounding area comprises regular shaped allotments which are generally consistent in size, orientation and shape. The majority of allotments in the surrounding area have an area of less than 630 square metres. (c) The scale and density of the proposed development is inconsistent with the existing streetscape which generally comprises single dwelling houses. 34The circumstances of the present case did not require an identification of what is commonly described as " the underlying objective ", because the LEP provisions at cl 11A are fairly prescriptive. Rather, the focus of the appeal was to argue that, in forming his opinion that the development achieved objectives (d)(i) and (d)(iii) (judgment at [24] and [29]), the Commissioner erred on a question of law. 35Contention 8 argued that the DA should be refused as it will set an undesirable precedent for similar inappropriate development in the area having regard to cl 11A of the LEP and the related clauses of the DCP in respect of minimum lot size for dual occupancies - 8(a) said: " there is more than a mere chance or possibility of development applications of the same class being lodged ... for sites within the surrounding area, where those sites are not distinguishable from the subject site ". Contention 8(b) complained that the applicant did not demonstrate that compliance with the minimum allotment size requirements was unreasonable or unnecessary in the circumstances, and 8(c) alleged that other non-compliances with the requirements of the DCP would result in " an adverse impact on the privacy and amenity of the adjoining residential development ". The contention argued, therefore, that the proposed development was " not in the public interest ". 36After the tendering of the parties' exhibits, the two planners were called to give concurrent evidence. The Council relied on its planning officer Paula Bizimis, and the proponent relied upon Kristy Lee of Hamptons Property Services (T30.09.10, pp12-39). 37Mr Loether then made oral submissions on behalf of the proponents (T30.09.10, pp39-42), followed by Mr Seton, on behalf of the Council (T30.09.10, pp42-48), and the Commissioner handed down his judgment at 9.30am the next morning. 38In the judgment Brown C defined the issues (pars [1]-[2]), the site and surrounding area (pars [3]-[4]), the relevant planning controls (pars [5]-[11]), and the SEPP 1 objection, as prepared by Ms Lee (par [12]). 39He then addressed the question " Is the SEPP 1 objection flawed ?" and found it to be in valid form. The Council does not take issue with that finding in this appeal, but does take issue with how the Commissioner determined the objection itself. 40Commissioner Brown drew attention (in [13]) to two relevant cases: Wehbe v Pittwater Council [2007] NSWLEC 827; (2007) 156 LGERA 446 (' Wehbe ') and Winten Property Group Limited v North Sydney Council [2001] NSWLEC 46; (2001) 130 LGERA 79 (' Winten '), to both of which I will return. 41The Commissioner noted (at [14]) Mr Seton's submission that the objection was flawed, in that " while it asked the right question of whether the development is consistent with the aims of the policy, it incorrectly adopted the policy as the objectives of Zone No 2 (Residential Zone) rather than the aims of SEPP 1 ". He then set out (at [15]-[18]) the clauses of SEPP 1 which I have quoted above, and stated (at [19]): Ms Lee's objection addresses why the development standard is unreasonable or unnecessary at p 7 in the SEPP 1 objection and is further addressed in her joint statement and her oral evidence. While it would have been more helpful if the SEPP 1 objection addressed the aims of SEPP 1 rather than the objectives of Zone No 2 (Residential Zone), I am satisfied that it is not fatal to the application, providing the aims of the SEPP 1 are addressed in determining whether the application is well founded, as required by cl 7. 42The Commissioner then addressed the objectives of cl 11A, focussing on 11A(1)(d) (which he set out in [7] and I set out in [19] above). He noted (at his [21]) that sub-paragraph (ii) of objective (d) was not in dispute, addressed objective (d)(i) (at [22]-[26]), rejected some arguments put by Ms Bizimis, and expressed satisfaction that the proposal achieved that objective. He then addressed (d)(iii) (at [27]-[29] of the judgment), and accepted that that objective was also achieved. 43For the purposes of this present appeal, the Commissioner's remarks in [24], [25], [26] and [29] are especially significant: 24. On objective (d)(i), I am satisfied that the proposal achieves the objective for a number of reasons; while Ms Bizimis sought to rely on the 36 lots in DP 8011, I do not accept that this is the appropriate test. The test of whether the subdivided lots retain the pattern of subdivision should be extended beyond this limited area. Importantly, the objective uses the words "residential area". I have taken this to mean land in the general area of the site and within the same zoning. The council helpfully provided a cadastral plan with a zoning overlay of an area around 150 m from the site. This plan is dated 4 August 2010, so I presume it is reasonably up-to-date in terms of subdivision. The plan reveals that the majority of the lots are around 600 sq m or more. However, there are a number of lots that have been subdivided in a similar form to that proposed in this application. For example, 121 Gloucester Road, 158 Gloucester Road and 209 Dora Street. 25. The fact that there has been no dual occupancies and subdivision in Carrington Avenue is not a determinative matter, in my view, given the same zoning as other streets in the area and the permissibility of dual occupancy developments in this zone. If the council were of the view that dual occupancy developments were inappropriate in Carrington Avenue, then the zoning of Carrington Avenue should reflect this fact. 26 I also do not accept Ms Bizimis's argument that the approval will create an unanticipated increase in density in Carrington Avenue. No evidence was produced to show that the additional density created by a single dual occupancy development would create any unacceptable impacts. This argument also needs to be seen in the light of the other uses such as multiple dwellings and residential flat buildings that are also permissible uses in Zone No 2 (Residential Zone). ... 29. On this objective [(d)(iii)], I am also satisfied that the proposed development achieves the objective. Again, any assessment should not necessarily relate strictly to the existing form of development in Carrington Avenue, but consideration must be given to the scale, density and form of development contemplated by the council's planning controls for the Zone No 2 (Residential Zone). In this regard, dual occupancies are a permissible use and have been approved by the council in surrounding streets. For reasons mentioned earlier, the zoning of Carrington Avenue does not provide any basis for the exclusion of dual occupancy development subject to an appropriate test against the requirements within the council's planning controls. As dual occupancy developments are a permissible use on the site and as the proposal satisfies all relevant development requirements with the exception of the minimum lot size requirement, I accept objective (d)(iii) is achieved. I note that Carrington Avenue runs parallel to Dora Street (to the North) and Gloucester Street (to the South). 44At [30] of his judgment, the Commissioner accepted that the proposal was " consistent with the aims of SEPP 1 and that strict compliance with the development standard in cl 11A(2A) " was " unreasonable and unnecessary in this case. It follows that the SEPP 1 objection is well-founded " (emphasis mine). 45The Commissioner then dealt with the questions of precedent (pars [31]-[32]), privacy ([33]-[35]), and accessibility to private open space ([36]). 46In par [37] the Commissioner said " pursuant to cl 8(3), I find that the proposed development is consistent with the zone objectives and, based on the findings in the previous paragraphs there are no reasons why consent should not be granted ". He granted approval on the basis of the tendered conditions, which became an annexure to his judgment. 47On the question of the " vicinity " or " residential area ", to be considered when applying the test, it is to be noted that Mr Seton had put the following to the Commissioner (at T30.09.10, pp45-46, LL9ff): Again, it comes back to this issue of the planned density. It's an important matter, commissioner. If dual occupancy is allowed on lots between 619 and 630 square metres a significant number of other sites in this locality become available for doubling of the density. That is putting two dwelling houses on and the associated impacts with that increase in density, it affects many other matters, infrastructure provision, the character, the amenity, the general intensity of use of an area. It's not just what you observe in the physical form of what you of the bulk and scale of development that you see but it's the other impacts that go with that that also make up the clerk of the area and have an impact on strategic planning for the locality. Here what you're being asked to do is change the strategic planning for this area because we now want to allow development on lots of 619 not 630 square metres so how many more will we get on that basis? What do we need to provide for if we are going to get that? There's been a part 3 process that has been gone through here to achieve a result of saying we want dual occupancies on lots of 630 square metres. That will give us a certain density and number of dwellings within this locality. If we go back to 619, how many more will it give us? That can't be answered because no analysis has been done and you can't be convinced and the onus here is on the applicant to convince you that the development in terms of the noncompliance with the development standard is well founded and that it would be unreasonable and unnecessary to require strict compliance with it in this case. It simply cannot be described as being orderly development in the test of the aims and objectives of SEPP 1. The planned approach to density assumes that more than two dwellings may be erected on a certain number of lots. If it is significantly increased by development of this kind we may as well throw out that strategic planning because it means nothing. This really is, as I said, an attempt to change the planning instrument for this area; a process that should be undertaken through part 3 if it is to occur and a proper analysis and study done of what you need if you are going to have an increased number of and an increased density of development within the zone 2, either overall or within certain localities. To summarise the particular factual matters, commissioner, of the 30 if I just look at that at the area as I did with Ms Lee in DP 8011, the 36 lots that were created in 1915 and haven't changed since that time, 19 of them had identical areas of 619.7 square metres. Of the 19,7 or 8 including the subject land but excluding the vacant lot that is being developed at the moment, have older style cottages which may be suitable for redevelopment in the immediate future. If an owner of those 7 or so lots wanted to develop them for dual occupancy in a similar form to the dual occupancy, the subject of the application, there is no reason why they could not point to this case and seek to invoke it as a precedent. 48In the course of his analysis of the decisions in Wehbe, and in Goldin & Anor v Minister for Transport Administering the Ports Corporatisation and Waterways Management Act 1995 [2002] NSWLEC 75; (2002) 121 LGERA 101 (' Goldin ') , from both of which he quoted to the Commissioner, Mr Seton also submitted (T30.09.10, p46, LL33-41): I rely upon that as something that is clearly applicable in this particular case having demonstrated that there are a number of other opportunities that are indistinguishable from the opportunity that presents on this lot if it were to be allowed and the adverse planning precedent that would be created by reason of allowing this particular development to occur. That is reinforced in terms of the ability to take into account and this mixes in with the merit question of precedent but the question of precedent a relevant in the context of SEPP 1 objection as well " .

Relevant principles and statutory provisions 49The Court Act provides: 30 Arrangement of business of the Court (1) The Chief Judge is responsible for ensuring the orderly and expeditious discharge of the business of the Court and accordingly may, subject to this Act and to such consultation with the Judges as is appropriate and practicable, make arrangements as to: (a) the Judge, Commissioner or Commissioners who is or are to exercise the Court's jurisdiction in particular matters or classes of matters, and (b) the Commissioner or Commissioners who is or are to exercise any other function under this Act. (2) Subject to subsections (2A), (2B) and (2C), in determining the Commissioner or Commissioners who is or are to exercise the jurisdiction of the Court or any other function under this Act in relation to any proceedings, regard shall be had to the knowledge, experience and qualifications of the Commissioners and to the nature of the matters involved in the proceedings. " 56A Class 1, 2 and 3 proceedings-appeals to the Court against decisions of Commissioners (1) A party to proceedings in Class 1, 2, 3 or 8 of the Court's jurisdiction may appeal to the Court against an order or a decision of the Court on a question of law, being an order or a decision made by a Commissioner or Commissioners. (2) On the hearing of an appeal under subsection (1), the Court shall: (a) remit the matter to the Commissioner or Commissioners for determination by the Commissioner or Commissioners in accordance with the decision of the Court, or (b) make such other order in relation to the appeal as seems fit. (3) Notwithstanding subsection (1), an appeal shall not lie to the Court under that subsection in respect of a question of law that has been referred to, and determined by, a Judge pursuant to section 36. 50Mr Galasso took the court to the decision of Craig J in Brinara Pty Ltd v Gosford City Council [2010] NSWLEC 230; (2010) 177 LGERA 296, which contains an analysis of the appropriate principles to apply in determining a s 56A appeal. In order for a decision made by a Commissioner (or two Commissioners) to be reviewable on such an appeal, there needs to have been a decision made in his/her/their judgment on a question of law. It is only after the identification of such a question in the decision of the Commissioner that one turns to a consideration of any possible error. 51In Walker Corporation v Sydney Harbour Foreshore Authority [2009] NSWCA 178; (2009) 168 LGERA 1 (' Walker ') Basten JA (Beazley and Young JJA agreeing) stated (at [20]) that the s 56A appeal jurisdiction arises where: (a) identification of a question of law is a precondition to engaging the Court's jurisdiction but is not a limitation on that jurisdiction, once engaged; (b) the question of law is not a mere precondition to ground an appeal but is the sole subject matter of the appeal, and (c) it is the decision of the Tribunal on a question of law which is the subject matter of the appeal. See also B & L Linings Pty Ltd v Chief Commissioner of State Revenue [2008] NSWCA 187; (2009) 74 NSWLR 481, per Allsop P at [70], and the cases cited by His Honour. 52It is not necessary that the answer to the question of law constitute the ultimate decision that has been appealed, so long as the answer is material to that decision. 53Counsel for the respondent Goreskis (in their submissions before me, at par 2) identified the following principles as relevant to the determination of this s 56A appeal: (a) the appeal is limited to questions of law (The Village McEvoy Pty Ltd v Council of the City of Sydney (No 2) (2010) 176 LGERA 119 at 25); (b) a "fine tooth comb" approach should not be employed when examining the decision of the Commissioner for errors of law (Brimbella Pty Ltd v Mosman Municipal Council (1985) 79 LGERA 367 at 368); (c) the Court would not take an overly critical or pernickety approach to the Commissioner's decision Carstens v Pittwater Council (1999) 111 LGERA 1 (at [76]); and (d) if the decision of the Commissioner reveals an error of law, then the decision is only vitiated if the error is material to the decision made. Design Power v. Willoughby City Council (2005) 148 LGERA 233 [34]. 54In Design Power Associates Pty Ltd v Willoughby City Council (' Design Power' ) [2005] NSWLEC 470; (2005) 148 LGERA 233, the gravamen of the relevant part of Lloyd J's judgment was that the Council complained before him that certain instruments were not considered by the Commissioner, when, in fact, Council had not seen fit to raise them for consideration at the original hearing (at [34]). Lloyd J found that such an error or omission may be seen to be material, but was more a matter of formality. His Honour referred to Housing Commission (NSW) v Tatmar Pastoral Co Pty Ltd [1983] 3 NSWLR 378; (1983) 53 LGRA 325 where Mahoney JA said (at p385 and p332) that " ordinarily " the Trial Judge may confine his attention to points taken and submissions made. Mahoney JA went on to state (at pp386-387 and p332): In my opinion, it is not open to a party on appeal to complain that reasons were not given for the decision of a matter of fact or law which was, or must have been, decided, if the matter was not the subject of submissions made to the court below in a way which called for a reasoned consideration of them. 55The Council in Design Power argued before Lloyd J that s 79C mandated consideration of relevant environmental planning instruments. Lloyd J referred to the Court of Appeal decision in Segal & Anor v Waverley Council [2005] NSWCA 310; (2005) 64 NSWLR 177 (' Segal '), in which a distinction was drawn between administrative decision-making at the level of executive or local government, and dispute resolver decision-making, such as before a judge or other judicial or quasi judicial officer called upon to decide issues raised in adversarial litigation. 56In Segal , Tobias JA (with whom Beazley and Basten JJA agreed) held that the Commissioner was bound to address only the principal issues joined between the parties. In an earlier Court of Appeal case, Mifsud v Campbell (1991) 21 NSWLR 725 (per Samuels JA, with whom Clarke JA and Hope AJA agreed), it was held that it was " an incident of judicial duty to give reasons to record the evidence and findings thereon which are critical to an issue in the case " (as quoted by Lloyd J in Design Power at [39]). 57In Design Power (at [40]) Lloyd J also relied upon the fact that authorities such as University of Wollongong v Metwally [1984] HCA 74; (1984) 158 CLR 447 and Coulton v Holcomb [1986] HCA 33; (1986) 162 CLR 1 had affirmed the principle that it was improper to allow a party, after a case had been decided against it, to raise a new argument which " whether deliberately or by way of inadvertence, it failed to put at the hearing when it had the opportunity to do so ". 58Lloyd J held in Design Power that failure of the Commissioner to consider certain environmental instruments did not amount to an error of law in the circumstances and facts of that case. 59The questions now before this court in this matter are, therefore, (1) whether the Commissioner made an error of law on those grounds raised by the Council, and, if so, (2) whether the matter should be remitted to Brown C, or to another Commissioner, for determination of whether development consent should be granted to the Goreskis on the basis of the provisions of SEPP 1. 60It is necessary to turn to the submissions of both parties to determine that first matter, and by doing so, to decide whether it is necessary to consider further the question of remitter.

Consideration of the Parties' submissions 61I will address the submissions in the order in which Mr Galasso addressed the grounds of appeal at the hearing, namely grounds 1, 4, 2, and lastly, 3 (insofar as it relates to ground 2 - see [12] above). 62To understand what follows, it is useful to set out again the three objectives of cl 11A(1)(d) of the LEP (quoted in [19] above): (i) the pattern of subdivision in residential areas is retained as reflected in lot size, orientation and shape, and (ii) allotments have a minimum size so as to provide landscaped areas that are suitable for tree planting, and (iii) the scale and density of development is compatible with the existing streetscape.

Appeal Ground 1

1. Whether the Commissioner erred in finding that strict compliance with a development standard is unreasonable and [sic] unnecessary on the basis that dual occupancy developments are a permissible use on the site and the proposal satisfies all relevant development requirements with the exception of the requirement subject of the objection under State Environmental Planning Policy No 1 - Development Standards ("SEPP 1"): [29]. 63As noted in [7] above, the respondents conceded this ground, but the court still requires the appellant to make it good. 64It was submitted by Mr Galasso, and had been asserted in the summons, that the Commissioner's error was to be found in [29] of his judgment, extracted above at [43], specifically concerning objective (iii) of clause 11A(1)(d). There were two elements to this ground. 65The first element was that whilst objective (i) referred to " residential areas " generally, objective (iii) referred only to the particular development and " the existing streetscape ", and, therefore, the Commissioner was incorrect in extending the objective assessment beyond Carrington Avenue. 66The second element was that the reference to dual occupancies in the planning controls, and to approvals in surrounding streets, demonstrated a failure by the Commissioner to consider the objective. 67Mr Galasso submitted that it was erroneous to consider that the objective of a development standard is satisfied because it is not excluded by the zoning. By extension, the Commissioner had failed to apply SEPP 1, had " ignored " the development standard, and had wrongly concluded that, because the development was permissible in the zone, it satisfied the development standard. Mr Galasso submitted (at par 24) that this error was " sufficient to set aside the judgment" . 68Mr McEwen (at par 6 of his submissions) agreed that the Commissioner " fell into legal error in that he misdirected himself by misconstruing the ambit of the objective " , despite correctly identifying objective (iii) as relevant to addressing the appropriateness of the development.

Finding on Ground 1 69Whether the Commissioner " ignored " the development standard, as submitted by the appellant, or " misconstrued " it, as submitted by the respondents, need not be determined. The Commissioner erroneously construed and applied objective (iii), and so asked himself the wrong question. His decision should, therefore, be set aside, as the parties have agreed, and the matter should be remitted to be determined afresh. 70I, therefore, now turn to consider the other grounds in order to determine whether they too provide a basis for remittal, and, then, to consider the terms of the remitter.

Appeal Ground 4 4. Whether the Commissioner erred in his determination of the objection under SEPP 1 in considering that the permissibility of the subject development effectively rendered the objection under SEPP 1 unobjectionable: [25]. 71This ground concerned whether the Commissioner asked himself the wrong question in relation to objective (i) of cl 11A(1)(d), and reference should be made to pars [24]-[25] of the Commissioner's decision (quoted in [43] above). 72Mr Galasso argued that the Commissioner's statement that the zoning would reflect whether dual occupancy is inappropriate, and is erroneous, in that it goes to the permissibility of the development, which is not an element of objective (i). It was submitted that the Commissioner should have considered the development standard itself, rather than considering the permissibility of dual occupancies under SEPP 1. 73Mr Galasso likened the Commissioner's consideration in this case to that in Winten . 74In Winten , after a nine-day hearing in 2000, the then Senior Commissioner allowed appeals brought by Winten against the determinations of the Council refusing six development applications concerning Berrys Bay, Waverton. The proposal was to subdivide the relevant land into five allotments and to erect a dwelling house on each lot created by the subdivision. 75Lloyd J heard the s 56A appeal, and considered many legal arguments, including arguments concerning the application or otherwise of SEPP 1. The four relevant clauses of the LEP amounted to pre-conditions that must be satisfied before the development could be approved after a proper consideration of its merits. Accordingly, His Honour dealt with the alleged failure to comply with those clauses. 76Lloyd J referred to Cripps J's classic statement of the approach to SEPP 1 in Hooker Corporation Pty Ltd v Hornsby Shire Council (1986) 130 LGERA 438, upon which Talbot J had relied in Memel Holdings Pty Ltd v Pittwater Council [2000] NSWLEC 206; (2000) 110 LGERA 217 at 220. Lloyd J, like Talbot J, quoted Cripps J at [25] of Winten , and then said: 26. In applying the above-mentioned judgment, it seems to me that SEPP 1 requires answers to a number of questions (not necessarily in the following order). First , is the planning control in question a development standard? Second , what is the underlying object or purpose of the standard? Third , is compliance with the development standard consistent with the aims of the Policy, and in particular does compliance with the development standard tend to hinder the attainment of the objects specified in section 5(a)(i) and (ii) of the EP&A Act? Fourth , is compliance with the development standard unreasonable or unnecessary in the circumstances of the case? Fifth , is the objection is well founded? In relation to the fourth question, it seems to me that one must also look to see whether a development which complies with the development standard is unreasonable or unnecessary, as noted by Cripps J in the Hooker Corporation case. 27. Memel Holdings Pty Limited v Pittwater City Council , to which I have referred was an appeal against a decision of the Senior Commissioner. Talbot J said (at 221): The failure to identify the objectives of the development standard and then to consider whether, in the light of those objectives, it was unreasonable or unnecessary to apply the development standard in the subject case means that the Senior Commissioner fell into legal error on a matter which was fundamental to the ultimate decision. 28.It seems to me that the Senior Commissioner has in the present case fallen into the same error which he committed in Memel Holdings . I refer to the Senior Commissioner's statement that "the development is seen as entirely acceptable as amended and should be supported by the relief available under State Environmental Planning Policy No. 1". In this respect the Senior Commissioner has misdirected himself. His reference to "the development" instead of to the non-compliance and to it being seen as entirely "acceptable" without reference to the object or purpose of the standard or to the objects of the Act suggests that he has undertaken a merit assessment rather than assessment under SEPP 1. 29.29. A finding of fact may reveal an error of law where judge (or commissioner) has misdirected himself (that is, in this case that "the development is seen as entirely acceptable" ), or where he has defined otherwise than in accordance with law the question of fact which he has to answer ( Azzopardi v Tasman UEB Industries Limited (1985) 4 NSWLR 139 at 156, per Glass JA). I refer also to the Senior Commissioner's further statement: "The application of height control as contained in the LEP in this instance would be both unreasonable and unnecessary" . The Senior Commissioner's statement that it "would be both unreasonable and unnecessary" is a conclusion. The reasons why the Senior Commissioner has reached such a conclusion are not set out. The Senior Commissioner might have been misled by the first of the identified issues, "whether the non-compliance with clause 12(1) of NSLEP 1989 (storeys) is acceptable... ". But this is not the test for determining an objection under SEPP 1. As in Memel Holdings , the Senior Commissioner has erred in law; and in this case he has erred on a provision which is a pre-condition to the permissibility of the proposed development. (his emphasis) 77Mr Galasso further submitted that it was irrelevant for the Commissioner to uphold the SEPP 1 objection on the basis that the proposal is permissible with development consent, because, but for SEPP 1, it would not be permissible on the subject land. Mr Galasso turned the court's attention to Wehbe , especially at [36], where Preston J said: This means that in order for the Court, exercising the functions of the consent authority, to have power to grant development consent to the applicant's proposed subdivision, it must uphold the SEPP 1 objection to compliance with clause 11(2) of PLEP. Upholding the SEPP 1 objection is a precondition which must be satisfied before the proposed development of subdivision can be approved on a consideration of the merits: Winten Property Group Ltd v North Sydney Council (2001) 130 LGERA 79 at 87-88 [19], 90 [29], 92 [44]-93 [45]. 78Mr Galasso alleged that the Commissioner applied an approach concerned with zoning rather than with the development standard to the consideration pursuant to SEPP 1. Mr Galasso submitted that this error was akin to that in Botany Bay City Council v Premier Customs Services Pty Ltd [2009] NSWCA 226; (2009) 172 LGERA 338 (' Botany Bay ') because the Commissioner had committed an error of law by applying his own view of the policy to the facts (T 11.02.11, p16, LL40-43) . 79In Botany Bay , Commissioner Bly overturned the Council's refusal of the respondent's development application, expressing his satisfaction that the development responded to the general objectives of the applicable DCP. Biscoe J dismissed an appeal against Bly C's decision, and a further appeal to the Court of Appeal was successful. 80The Court of Appeal held that while the Commissioner referred to the relevant provisions and was entitled, in the particular circumstances of the subject site, to depart from them, he took a different view than that embodied in the DCP as to the applicable general policy and substituted his own approach for the statutory standard. The Court of Appeal followed Zhang v Canterbury City Council (2001) 51 NSWLR 589; 115 LGERA 373. It was found to be an error of law for the Commissioner to apply his own view of the appropriate general policy, rather than that embodied in the DCP. The principal judgment was delivered by Macfarlan JA (with whom Ipp JA and Hoeben J agreed), who said (at [32]-[35]): 32 I appreciate that it is not appropriate to approach reasons of a Commissioner with a "fine-tooth comb", but the Court must nonetheless attempt to ascertain as best it can what were the essential reasons for a decision. The first three sentences of [30], appearing as they do in what is undoubtedly the critical paragraph of the Commissioner's reasoning on side setbacks, only make sense to me as a statement that the Commissioner regards the DCP's side setback requirements as excessive where the proposed industrial development adjoins a "residential use" (at least where that residential use is not in an adjoining residential zone). Seen in this way, the first three sentences of the paragraph lead into a determination by the Commissioner in the fourth sentence, independently of the standard set by the DCP, of what was a reasonable eastern side setback in respect of this site. 33 My view is thus that the Commissioner, in respect of the eastern side setback, put aside the standard set by the DCP and applied his own standard of what is reasonable. Accordingly his decision did not conform with the principles stated in Zhang as he failed to "take into consideration" the DCP in the manner required by s 79C. He applied his own view as to the appropriate general policy, not that embodied in the DCP. He therefore committed an error of law ( Zhang at [60]). 34 The Commissioner did not find the eastern side setback satisfactory because he thought that in the particular circumstances of this development it was not appropriate to apply the DCP standard but, rather, because he disagreed with the standard set by the DCP. My interpretation of the Commissioner's reasons thus differs from that of Biscoe J who took the view that "the Commissioner did not forgive compliance with the DCP because he disagreed with it" (at [26]). 35 I conclude on this aspect of the matter by indicating my respectful agreement with the views expressed by McClellan CJ, as he then was, in Stockland Development Pty Limited v Manly Council [2004] NSWLEC 472; (2004) 136 LGERA 254 that "consistency of decision-making must be a fundamental objective of those who make administrative decisions" and that "that objective is assisted by the adoption of development control plans and the making of decisions in individual cases which are consistent with them" (at [88]). The ability of an individual decision maker to reject the general policy underlying a development control plan would be antithetical to the achievement of the fundamental objective to which McClellan CJ referred. 81Mr Galasso submitted that what was relevant in the present case was the consideration of the development standard by the Commissioner and the requirements in SEPP 1 in relation to that development standard. The Commissioner erred when coming to his determination, either by avoiding the task set for him by SEPP 1, or by upholding the SEPP 1 objection on the basis that the dual occupancy was permissible on the subject land. 82On the other hand, Mr McEwen submitted that the Commissioner committed no error of law on this ground. Upon a " fair reading " of the Commissioner's decision, it would be found that (submissions, par 26) the Commissioner had made the following findings: (i) the objective is achieved for a number of reasons [24]; (ii) the relevant pattern of subdivision to be retained is not limited to that exhibited by the 36 lots in DP 8011 but extends to those lots in the wider residential area [24]; (iii) the words " residential area" extend beyond the limited area of DP8011 and "mean land in the general area of the site and within the same zoning" [24]. (iv) within 150 metres of the site there are a number of lots similar in form to that proposed by the development application [24]; (v) the current absence of dual-occupancies and subdivision in Carrington Avenue is not determinative because Carrington Avenue is zoned in a similar fashion to neighbouring streets which do contain dual occupancies [25]; (vi) dual-occupancy continues to be a permissible form of development in Carrington Avenue [25]. 83Mr McEwen opined that the Commissioner was satisfied that the proposed development would achieve the objective on the basis that it would not disrupt the existing or contemplated pattern of subdivision in the surrounding residential area. The Commissioner " did not rely solely upon permissibility as the basis for concluding that the objective was met " (submissions par 28), but, rather, his reference to the permissibility of dual occupancies in the zone was merely " observation ", and "legitimate ". Permissibility was but one of the Commissioner's considerations on the question of whether the current pattern of subdivision would be retained, and whether the lots that existed meant that future development could not diverge from that pattern (T 11.02.11, p30, LL24-30). 84These conclusions were " open to " the Commissioner, were " unobjectionable " , and were " findings of fact " . Further, there was no error of law, because the Commissioner recognised the difference between the reference to " residential area " in objective (i), and " existing streetscape " in objective (iii), evident from his extension of the " test " to an area beyond the subject lot.

Finding on Ground 4 85If the Commissioner relied solely on permissibility as a basis for concluding that objective (i) was met, the court ought to conclude, in light of the authorities, that the Commissioner erred and that the judgment should be set aside on that basis. However, I am not satisfied that Mr Galasso has demonstrated that the Commissioner made any such error, and I accept Mr McEwen's submissions in this regard. The Commissioner referred to permissibility as only one of many factors that assisted him in coming to his decision that objective (i) was satisfied. Ground 4 has not been made good.

Appeal Ground 2 2. Whether the Commissioner erred in the assessment of the objection under SEPP 1 by failing to take into account the precedent effect of upholding the objection in his consideration of the objectives of the development standard. 86Mr Galasso submitted that Brown C failed to take account of the precedent effect of his decision, and thus erred on a question of law, when he found (at [31]-[32]): Precedent 31 The potential precedent effect for others properties in Carrington Avenue was raised by Ms Bizimis. The Court was referred to the decision of Lloyd J in Golden [sic] and Anor v Minister for Transport 121 LGERA 101 where it was found that precedent is a valid planning consideration. 32 I am not, however, satisfied in this case that the issue of precedent would be a reason to refuse the application. Dual occupancy developments are a permissible use within the Zone No 2 (Residential Zone).and if an application is submitted on a lot less than 930 sq m, then it will need to be assessed through SEPP 1 and the merits considered under LEP 1994 and the DCP. 87In Goldin , a case relied upon by Mr Seton in the hearing of the class 1 appeal (par [48] above), Lloyd J considered two appeals under s 56A concerning properties at Castlecrag. His Honour surveyed the authorities on precedent effect dating back to a decision of Sugerman J in Emmott v Ku-ring-gai Municipal Council (1954) 3 LGRA 177 , later adopted by Cripps J in Milner v Willoughby Municipal Council (NSWLEC, 19 April 1984, unreported) . Cripps J said " even if one bad planning decision were made, the Council is not compelled by that circumstance to repeat its mistakes ". 88In Maxwell James Maxwell Pty Ltd v North Sydney Municipal Council (NSWLEC, 13 December 1991, unreported) Stein J said " the precedent argument may properly be seen as an argument of last resort. Assuming precedents to be good or bad, there is no justification for blindly following a bad one. It's the merits of any particular development which are important ". Pearlman J also followed those dicta in Dale v Maritime Services Board of New South Wales (1992) 75 LGRA 224, and, in Pittwater Council v Mount [2000] NSWLEC 256 , Bignold J upheld a decision of a Commissioner, who had followed Pearlman J. 89Lloyd J noted in Goldin that the court had treated the notion of precedent with considerable caution. The Senior Commissioner in that case had found that the proposals had an undesirable visual impact and, therefore, satisfied the criteria identified by Sugerman J to give rise to a valid consideration of precedent (at [29]): ... the present proposals were not 'unobjectionable' in themselves and there was a sufficient probability for further applications of undistinguishable developments of the same class and in the same locality . 90Lloyd J went on to hold that the precedent effect of a particular proposal is a valid planning consideration, and His Honour relied upon the binding authority of the Court of Appeal in BP Australia Ltd v Campbelltown City Council (1994) 83 LGERA 274. 91Mr Galasso submitted (pars 28-30) that the Commissioner, whilst correct in observing that precedent was a valid planning consideration, had " divorced " this from the consideration of the SEPP 1 objection. This approach was incorrect because " the matter of precedent is a matter wholly relevant to the consideration of the SEPP 1 objection in this case " . 92Mr Galasso again turned the court's attention to Wehbe . 93For present purposes the elements of Preston J's decision in Wehbe most relevant to this case are items 10 to 12, as recorded in the headnote (at 448): (10) Although the most commonly invoked way to establish that an objection under SEPP 1 was well founded and consistent with the aims set out in cl 3 of SEPP 1 was to establish that compliance with the development standard was unreasonable or unnecessary because the objectives of the development standard were achieved notwithstanding non-compliance with the standard, it was not the only way to establish that compliance with a development standard was unreasonable or unnecessary. .... (11) Although the power under SEPP 1 was wide, it needed to be exercised on the grounds in SEPP 1 relating to the development standard and the circumstances of the case. It did not allow a consent authority to dispense with compliance with a development standard merely in order to bring about conformity with some other planning control. (12) SEPP 1 did not permit the consent authority to rank in order of importance planning controls applicable to the land and the proposed development, and give precedence to other planning controls over the development standard. 94Preston J referred (at [47]) to the fact that Council's own actions in granting consents departing from a development standard can result in the standard being regarded as being " virtually abandoned or destroyed ", resulting in turn in compliance with the standard becoming unnecessary and unreasonable. At [79]ff His Honour said: 79 If the SEPP 1 objection to compliance with the development standard in cl 11(2) were to be upheld for subdivision of this land on the grounds given in the original SEPP 1 objection, there would be little justification for not also upholding SEPP 1 objections to subdivision of land of similar size and nature in the locality. These grounds are of a general nature and would be applicable to many sites in the locality. They are not particular to the circumstances of this land. The ad hoc deviation from the development standard in this case on these grounds would, therefore, create an adverse planning precedent for similar action to be taken in relation to other such land. This would affect the integrity of the planning policy embodied by cl 11. This would not be an appropriate use of the dispensing power under SEPP 1: see Bowen v Willoughby City Council at 112 and [113]. ... 83 Finally, I am not satisfied that a consideration of the matters in cl 8(b) of SEPP 1 justifies the upholding of the SEPP 1 objection. There is public benefit in maintaining the planning controls adopted by cl 11. 84 In reality, the applicant in this case objects to compliance with the development standard in cl 11(2) because it prevents the applicant maximizing the potential for development of the land for two dwelling houses, one on each allotment. The applicant's approach has been to submit a planning justification upon an assumption that there is no development standard and to use that justification as the basis for its objection under SEPP 1. As held in Hooker Corporation Pty Ltd v Hornsby Shire Council at 442, "this is to invert or reverse the reasoning process required under SEPP No. 1 " . 95In contrast, Mr McEwen submitted (par 9) that the Commissioner's specific references to precedent and to areas " a lot less than 930sqm (sic) " directly addressed the fact that precedent was not a reason for refusal, namely because future applications would be required to satisfy SEPP 1, the LEP and the DCP. Further (par 12), although the planners in their joint statement, and the appellant in its oral submissions to the Commissioner, raised the issue of precedent, there was no specific mention of SEPP 1, and it was, therefore, unnecessary for the Commissioner to make specific reference to precedent in relation to SEPP 1. 96Mr McEwen (par 14) took the court to Segal . In that case, two neighbours applied for permission to erect garages on adjacent properties. The Council refused both applications and each neighbour appealed to the court. Commissioner Moore dismissed one neighbour's appeal, and Commissioner Watts, who made no reference to Moore C's decision, upheld the second neighbour's appeal. 97The Council successfully appealed Commissioner Watts's decision to Lloyd J, who set aside the Commissioner's decision and remitted the matter to be reheard. Lloyd J's decision was then challenged in the Court of Appeal. The Court of Appeal held that, although consistency in the application of planning principles is a desirable objective, the so-called principle of consistency in administrative decision-making had no role to play in an appeal to the Land and Environment Court. Accordingly, a Commissioner who fails to mention a previous decision on similar facts, and who ultimately reaches a conclusion contrary to that decision, does not thereby commit an error of law. 98Tobias JA (with whom Beazley and Basten JJA agreed without additional comment) held that the duty to give reasons is confined to the essential ground or grounds upon which the decision rests and does not include a requirement to deal with a submission or argument that is otherwise unnecessary to the decision arrived at, provided that the judge's reasoning process for reaching the decision is articulated and relevant findings are made (at [93]). 99As Segal is also relevant to the question of remitter, I extract here paragraph [99] of t he judgment of the Court of Appeal, allowing the appeal: 99 Accordingly, I would summarise my views on this aspect of the matter as follows: (a) Although a Commissioner of the Land and Environment Court is obliged to consider the principal contested issues before him or her, each of those issues is the genus of which the various arguments in favour or against the resolution of the issue in a particular way are species. (b) It is unnecessary for a Commissioner or a judge of the Court to consider each of the species provided he or she has considered the genus. It is that which must be addressed in the Commissioner's or judge's reasons. Those reasons must be adequate to explain, by way of findings and reference to the evidence supporting the findings, the reasoning process adopted by the Commissioner or judge and which has led to his or her conclusion. (c) To the extent referred to, there is probably no inconsistency between the observations by the High Court in Yusuf to which I have referred on this issue and those of the judges of this Court in the authorities referred to above. (d) In the present case, the only principal contested issue was whether the impact of the particular proposal upon the heritage significance of the retaining wall was acceptable: that issue was considered and determined by Commissioner Watts and his reasons for doing so were more than adequately expressed. (e) Although raised before Commissioner Watts, the principle of consistency in administrative decision-making was not a principal contested issue in the sense in which that expression has been used in the authorities. (f) Not only was Commissioner Watts not bound by the decision of Commissioner Moore, he was not required to take it into consideration if otherwise he considered it irrelevant (as he clearly did) to the resolution of the principal contested heritage issue which he was required to consider. (g) Accordingly, the failure by Commissioner Watts to refer to the decision of Commissioner Moore or to explain why he was not prepared to follow it did not contravene his duty to give reasons and, therefore, did not constitute an error of law. (h) The primary judge was in error in holding to the contrary as a consequence whereof the orders made by his Honour should be set aside and the appeal from Commissioner Watts to the primary judge pursuant to s 56A of the Court Act should be dismissed with costs. 100The Court of Appeal found that no remitter was justified on the facts and circumstances before Lloyd J. 101Mr McEwen identified (at pars 14ff) the " principally contested issues " in the matter before the Commissioner in this case as concerning " whether or not the SEPP 1 objection was well founded " . In Mr McEwen's opinion, the effect of precedent was not a principally contested issue, but rather, " a species of the genus " . Mr McEwen, therefore, submitted that even if the Commissioner had not addressed precedent, his failure to do so could not be construed as an error of law. 102Mr McEwen also drew the court's attention (in par 16) to Parramatta City Council v Joseph Takchi [1996] NSWLEC 118, where the critical controversy was a draft LEP. In that case Stein J held that the Senior Commissioner was correct not to take the draft LEP into consideration or at least made no error in failing to do so. Although the Commissioner did not " directly " refer to the draft LEP in his judgment, it was perfectly clear to His Honour that the Commissioner was well aware of it, having made specific reference to it in discussing the evidence of a planning witness, and a reference also to evidence in the Council's case about the appropriateness of the zoning under the old LEP. His Honour concluded that the Commissioner " adequately took the draft LEP into consideration as a circumstance of the case", but, if he were wrong in that conclusion, it was " abundantly clear " that any such error could not be said to vitiate the court's decision. He dismissed the s 56A appeal. 103In his oral submissions in reply (T 11.2.11, p48, LL14-46), Mr Galasso stated that the reference to " genus and species " in Segal was irrelevant in this case, because the genus could not be separated from the species. Using this classification at 99 of Tobias JA's judgment ([99] above), the species on the facts of the present case was the SEPP 1 objection - the very matter that the Commissioner had to decide. Further, Takchi was distinguishable with regard to the circumstances of the case because in that case, although not considered a matter of substance, regard was paid to the draft LEP. In Mr Galasso's submission, in the present case, it was clear that the Commissioner did not consider the precedent issue in deciding the SEPP 1 objection.

Finding on Ground 2 104If the issue of precedent was a principal issue, as Mr Galasso submitted, and, if it is correct that the Commissioner " divorced " the question of precedent from the SEPP 1 objection, then he did, indeed, commit an error of law. However, I am not satisfied that the issue of precedent was a principal issue - it is not expressly required to be considered by SEPP 1, the LEP or the development standards, and thus should be seen as only a peripheral matter before the Commissioner, and not wholly relevant to the consideration of the SEPP 1 objection. Ground 2 has not been made good.

Appeal Ground 3 3. Whether the Commissioner erred in his assessment of the objection under SEPP 1 by reversing the onus of establishing that the objection was well-founded: [26]. 105This ground concerned whether the onus is truly, and correctly imposed, on the Council to prove that the subdivision would create an unanticipated increase in density, offending objective (i). 106As noted above ([12]), Mr Galasso submitted on the appellant Council's behalf at the hearing of this appeal, that this ground does not need to stand on its own and can be seen as embodied in ground 2. It can be taken from Mr Galasso's oral submissions (T 11.2.11, p21, LL1-10) that the ground was not pressed. 107I do not see how considering ground 3 assists me in determining the appeal, and the respective written submissions did not take the matter any further than my determination regarding ground 2.

Conclusion on the Appeal grounds 108I, therefore, conclude that only the conceded ground, ground 1, has been made good, but that the appeal should be upheld on that basis.

Remitter 109In consequence of the above conclusion it is necessary to set aside the Commissioner's judgment and remit the matter to a Commissioner of this court for further consideration. The issue for the court is whether that should be to Brown C, or to a Commissioner other than Brown C, to be nominated by the Chief Judge. The latter type of remittal order is sometimes referred to as an " exclusionary order ". 110Counsel took the court to Castle Constructions Pty Ltd v North Sydney Council [2007] NSWCA 164; (2007) 155 LGERA 52 (' Castle '). In that case, the central issue was the interplay between two provisions of the LEP. In finding against the development, the then Senior Commissioner expressed his dislike of the proposed development in trenchant and powerful terms. In the s 56A appeal, Talbot J upheld only three out of 14 grounds of appeal, but that those errors were sufficient to vitiate the decision. He did not order that the matter be remitted to a different Commissioner. 111In the Court of Appeal, Bell J agreed with Tobias JA, who set aside the remittal order, and substituted an order that the matter be remitted to a different Commissioner. Basten JA took a fairly narrow view of the jurisdiction of the Court of Appeal in the matter and, at the end, set aside Talbot J's order and remitted the matter to the Land and Environment Court " for a judge of that court to determine whether the order of remittal to a Commissioner include the words 'other than the Senior Commissioner' ". He otherwise dismissed the appeal. The binding authority of the Castle decision is, therefore, in the reasoning of Tobias JA, especially on this point (see [70]-[86] of the judgment). 112Tobias JA held that both the s 56A appeal judge, and the Court of Appeal under s 57(2)(b) and s 75A(10) of the Supreme Court Act 1970, had the power to remit the proceedings to a Commissioner other than the trial Commissioner. Tobias JA restated his view, with which Handley and Ipp JJA had agreed, in Baulkham Hills Shire Council v Basemount Pty Ltd [2003] NSWCA 189; (2003) 126 LGERA 339 (' Basemount ') . In Basemount he had emphasised (at [25]) that he was not intending to " lay down any principle of general application to s 56A appeals " on the appropriateness of an exclusionary order. Castle, therefore, demonstrates that a remitter will always depend on all the facts and circumstances of the particular case. 113At [71]ff of Castle , Tobias JA referred to a decision of the Court of Appeal in Seltsam Pty Limited v Ghaleb [2005] NSWCA 208; (2005) 3 DDCR 1 (' Seltsam '), which was decided later than Basemount and involved a case before the Dust Diseases Tribunal. In Seltsam, Mason P exercised the claimed power to make an exclusionary order. He expressly agreed with Basten JA that the power should be exercised with caution and with respect for the authority of the judicial officer or officers in the court or tribunal below who have authority to assign cases. His Honour continued (at [15]): But where this Court is seized of a matter that persuades it as to the propriety of making a direction of this nature, the power should be used. It should not be left to the President, Chief Judge or List Judge of the court or tribunal below to have to make enquiries and form a judgment on such matters. Rather, absence of a direction should be read as a signal that it is open (but not obligatory) to assign the new trial to the original judicial or other officer. 114Tobias JA then quoted at some length from Basten JA's decision in Seltsam . Basten JA, contrary to the decision of Mason P, had determined that the matter should be left to the President of the tribunal. In Seltsam , Ipp JA had agreed with Mason P, and had dealt in terms with some of the comments of Basten JA, quoted by Tobias JA. Ipp JA said (at [142]): ... It is not an extraordinary occurrence for this Court to order that the case be heard afresh by a different judge...Where a judge has made credibility findings and has indicated a preference for a particular witness or witnesses or has failed to accord a party procedural fairness, the proper administration of justice may require the making of such an order. The need to do so will then arise not because of any established or presumed bias on the part of the judge but simply because of the public interest in providing the appearance of impartial justice. Often, the Court will make such an order of its own motion without hearing the parties. This practice recognises that the identity of the judicial officer who is to hear a particular case should not be regarded as a matter that could benefit or prejudice a particular party. It is not a requirement of procedural fairness that the parties be informed that the remitted trial be heard before a new judge. Moreover, it would often be invidious for a party to seek such an order. 115Having quoted Ipp JA, Tobias JA went on to say (in Castle at [76]): Like Mason P, I agree with Basten JA that this or any other Court should be slow to make an order that proceedings be remitted to a judicial officer other than the officer who heard the original proceedings. However, I respectfully disagree that the curial reticence to make such an order should increase in relation to the constitution of a statutory tribunal created as a court of record or that the making of such an order demonstrates a lack of confidence on the part of the Court in the ability of the relevant tribunal properly to organise its own affairs. I therefore agree with the approach of Mason P and Ipp JA which I have recorded in ... these reasons ... 116Tobias JA pointed out (at [80]) that none of the errors identified by Talbot J in Castle " were of the type found by the Chief Judge in her judgment in Basemount". The Senior Commissioner's exercise of his discretion in Castle was, therefore, not shown to be either " unreasonable or plainly unjust ". 117Tobias JA went on to consider further submissions made on behalf of the appellant, and it is appropriate to repeat at length His Honour's analysis (at [82]-[86]): 82 It was submitted that in applying that test, his Honour ought to have concluded that a fair-minded lay observer might reasonably apprehend that if the matter was remitted to the Senior Commissioner, he might not bring an impartial mind to the redetermination of the appellant's application on its merits and this was particularly so where, on any such re-determination, cl 30 of the LEP was to be taken out of the equation. The error of law committed by the primary judge, if there was clearly an apprehension of pre-judgment in the relevant sense, was his Honour's failure to determine that the interests of justice required the making of an exclusionary order. Further, it was submitted that his Honour erred in law by failing to make such an order by leaving it to the Chief Judge to determine whether the Senior Commissioner should hear the remitter or some other Commissioner. In other words, his Honour had a duty, which he could not defer to the Chief Judge, to determine for himself whether the Senior Commissioner was disqualified from hearing the remitter upon the ground of apprehended bias and, if he came to the conclusion that he was so disqualified, to make the appropriate exclusionary order. 83 The appellant further submitted that the Council's submission that the appellant had been unable to demonstrate "something more than error" on the part of the Senior Commissioner so that the pre-conditions to the making of an exclusionary order referred to by Mason P in Seltsam at [12] had not been satisfied, was in error. For an exclusionary order to be made, not only must the decision-maker be shown to have committed error (thus entitling the appellant to an order for remitter), but also there was a need to demonstrate something more being in the present case, that the Senior Commissioner acted in such a way as to give rise to a reasonable apprehension of bias: see also Basemount at [23]. 84 Accordingly, in the present case, not only had it been demonstrated that the Senior Commissioner had erred in law in a number of respects thus requiring a remittal order, but also "something more than error" had been demonstrated, namely, reasonable apprehension of pre-judgment of the merit issues which were required to be determined afresh on that remitter. 85 In my opinion the appellant's submissions should be accepted. With respect to the Senior Commissioner, there can be little doubt that the nature and expression of his findings were such as to clearly give rise to a reasonable apprehension that he may not decide the case on remitter impartially in the relevant sense. This is because he was required on the evidence then before him to determine the very merit issues in respect of which the appellant's development application is now required to be determined afresh. This he did adversely to the appellant. He has thus pre-judged those issues so far as the remitter is concerned. This is not to say that he was not justified in rejecting the development on its merits for the reasons he then gave. It is not for me to comment on the Senior Commissioner's merit decision one way or the other. I can assume for present purposes that it was entirely justified. But that does not detract from the fact that the Senior Commissioner determined the development on its merits which, whether justified or not, would reasonably convey to a fair-minded lay observer that if the matter remitted to him, he may not bring an impartial mind to a fresh determination of the very same merit issues. 86 Accordingly, it was insufficient, in my respectful view, for the primary judge to leave the decision as to whether such a reasonable apprehension existed to determination by the Chief Judge when re-listing the matter pursuant to his powers under the Court Act. Once his Honour was seized of the matter it was his duty, in accordance with principle, to determine whether there was a reasonable apprehension of pre-judgment and if so, to direct that the proceedings be remitted to a Commissioner other than the Senior Commissioner. Such a direction ought to have been made. In my respectful opinion his failure to do so constituted appellable error. 118Tobias JA went on to deal with the question of whether the Court of Appeal could and should exercise the exclusionary power in disposing of the appeal, and concluded (at [99]-[102]) in the affirmative. 119The essence of the principle espoused in Basemount had been articulated by Mahoney JA in Australian National Industries Ltd v Spedley Securities Ltd (in liq) (1992) 26 NSWLR 411 (' ANI '), but Tobias JA also relied upon (and quoted at [21]) the following passage from Re J.R.L.; Ex party C.J.L (1986) 161 CLR 342 (at 352 per Mason J): ...It needs to be said loudly and clearly that the ground of disqualification is a reasonable apprehension that the judicial officer will not decide the case impartially or without prejudice, rather than that he will decide the case adversely to one party. There may be many situations in which previous decisions of a judicial officer on issues of fact and law may generate an expectation that he is likely to decide issues in a particular case adversely to one of the parties. But this does not mean either that he will approach the issues in that case otherwise than with an impartial and unprejudiced mind in the sense in which that expression is used in the authorities or that his previous decisions provide an acceptable basis for inferring that there is a reasonable apprehension that he will approach the issues in this way. In cases of this kind, disqualification is only made out by showing that there is a reasonable apprehension of bias by reason of prejudgment and this must be ''firmly established"... 120In Basemount , on the hearing of a s 56A appeal, the applicant conceded an error of law in the imposition of a condition, and Pearlman J remitted the case to the same Commissioner (Murrell C). In the appeal from Pearlman J's decision, Tobias JA found that the relevant provisions of the Court Act indicate that it is permissible to remit the matter to another Commissioner, but that it is not automatic simply because of the success of the s 56A appeal. His Honour said (at [23]): Before concluding, I should make it clear that the present case is being decided on its own facts. It should not be assumed that merely because a Commissioner's decision is set aside on a s 56A appeal on the ground of error of law that it necessarily follows that any re-hearing and re-determination of the appeal should be by a Commissioner other than the Commissioner from whose decision the appeal was brought. There are many errors of law which would not require an exclusionary order under s 56A(2)(b). Thus if a Commissioner has mistaken the law and asked himself or herself the wrong question, there may be no reason why the appeal should not be remitted to that Commissioner to be determined by him or her in accordance with law. Again, where the error only involves the misconstruction of a statutory provision or the like there may be no reason why the Court as originally constituted cannot apply the facts as found by it to the law as declared on the appeal. In such cases the Commissioner's earlier decision may have been based on a false issue or be otherwise severable so that there will have been no pre-judgment on the real issue. 121In view of the finding that the Commissioner was guilty of a pre-judgment of " quite a high order ", Tobias JA concluded that Pearlman J had erred in declining to order the remittal of the matter to a different Commissioner. 122I accept that Tobias JA has set out in Castle and Basemount the correct approach to be taken in respect of exclusionary orders when " something more than error " has been established. 123Mr Galasso, for the Council, submitted that an exclusionary order should be made on this appeal on the basis that Commissioner Brown's consideration of the appeal was materially infected by errors in his approach to zoning and his consideration of SEPP 1, and also on the basis that he displayed " something more than error ", namely pre-judgment. He relied on the judgment of the Court of Appeal in Basemount , but also submitted that the notion of pre-judgment needed to be considered also in light of the recent majority High Court decision in British American Tobacco Australia Services Ltd v Laurie [2011] HCA 2; (2011) 242 CLR 283 (' BAT '), especially at [1], [49], [103]-[104], [139], [145]. 124In the Dust Diseases Tribunal Curtis J had made an interlocutory finding, adverse to the tobacco company, that it had dishonestly concealed destruction of relevant documents, that might have proven prejudicial to it in litigation, under the pretence of a document retention policy. His Honour later refused to disqualify himself from presiding in subsequent proceedings brought against the company by another party. The Court of Appeal agreed with him, but Allsop P dissented from the majority decision of Tobias and Basten JJA. The company appealed that " split " decision to the High Court. 125There does not appear to be any major difference among the judges of the High Court as to the correct principles to apply, but the court divided on the outcome of applying them to the facts of the case, clearly indicating that bias cases always involve questions of degree, " and particular circumstances may strike different minds in different ways " (per French CJ at [3]). 126French CJ said (earlier in [3]): In my opinion the Court of Appeal was correct. The judge made it clear in the interlocutory ruling that he was basing his conclusions on the limited evidence put before him and that a different picture might emerge at trial. His finding would not appear, to a fair-minded lay observer, to give rise to a reasonable apprehension of bias in different proceedings some years later against the same defendant. In my opinion, which differs from that of the majority in this case, the appeal against the decision of the Court of Appeal should be dismissed. 127In reply, Mr McEwen submitted (pars 32ff) that, as stated by Castle and Beaumont , an exclusionary remittal order is discretionary and depends on the facts and circumstances of the case, and the appellant had not demonstrated " something more than error " on the Commissioner's part. 128Mr McEwen distinguished the present case from the situations in Castle, Basemount , and Preferred Projects (Buildings) Pty Ltd v Warringah Council [1999] NSWLEC 283; 106 LGERA 144 (' Preferred Projects '), in which Talbot J held that a Commissioner be disqualified from hearing the proceedings on the ground that he had in fact already made up his mind in respect of a number of matters requiring determination in the new appeal, giving rise to a genuine apprehension of bias. His Honour said (at [24]): The apprehension that the Commissioner may not bring an unbiased and open mind to the issues which arise for determination for a second time is, in my opinion, well founded. The present application is an attempt to meet the observations made by the Commissioner on the last occasion. For the council to succeed it is apparent that the Commissioner will be expected to change his mind about opinions and conclusions presented by experts and with whom he has actually chosen to agree or disagree. A fundamental problem stems from the Commissioner expressing views about foreshadowed changes which it was not necessary for him to express in the earlier proceedings. That having been done however, the disinterested observer would be entitled, in my opinion, to apprehend that it is unlikely that the Commissioner can be brought to the position where he actually changes his mind. 129Mr McEwen submitted that the facts and circumstances of the present case did not demonstrate pre-judgment, but, rather, were similar to Neate v Shellharbour City Council (No 2) ("Neate") ([2007] NSWLEC 541, in which Pain J upheld a s 56A appeal and remitted the matter to the same Commissioner. Her Honour said that pre-judgment on the " real issue " must be " firmly established ", and that, in fact, the real issue in that case had not yet been decided, so there could be no reasonable apprehension of a pre-judgment of it, Her Honour said (at [15]-[16]): 15 I agree with the submission of the Applicant that as the Senior Commissioner has applied the wrong legal test he has not yet determined the matter in issue. The reasonable apprehension of pre-judgment of the merit issue does not arise. 16 I do not consider on the facts and circumstances of this case that a fair-minded observer would have a reasonable apprehension of pre-judgment on the part of the Senior Commissioner if the matter were remitted to him. It follows that I do not consider an exclusionary order for remittal is appropriate in this case. 130Mr McEwen submitted that the legal consequence of Brown C's conceded error in the present case, i.e. applying the wrong test to determine whether the development met objective (iii), was that the relevant question was not determined. Mr McEwen argued that there was no reason the Commissioner could not re-determine the question, because there was no evidence to suggest that he would not be impartial. 131In reply, Mr Galasso submitted that the Commissioner's lack of impartiality was evident by the way in which the applicant pleaded its case - " individually and...accumulatively " - because the Commissioner effectively determined what he would do on the SEPP 1 objection. Furthermore, he submitted that the present case differed from Neate in that this matter was based on the " factual circumstances or the principles " of the SEPP 1 objection, rather than a failure to have regard to a DCP. Mr Galasso also suggested that the respondent was resisting an exclusionary remittal because " one could not seriously be regarded as wanting to hang on to Commissioner Brown unless one anticipates an expectation of a not dissimilar result " (T 11.02.11, p49, L49-p50, L1). 132I do not accept Mr Galasso's arguments in favour of an exclusionary remittal order, and I consider that it is appropriate to remit the matter to Commissioner Brown to redetermine the matter in regard to ground 1, and objective (iii).

Costs 133The final matter to be determined is the question of costs. 134In the summons the appellant sought an order that the respondent pay its costs of this appeal. 135The Commissioner's decision would have stood if no appeal had been brought. When brought, the respondent conceded error, requiring remittal for re- determination on the error of law identified. The fact that one ground was not pressed on the day of the hearing did not, in Mr Galasso's submission, derogate from the making of the normal costs order, namely that costs should follow the " event " of the appellant's success on the appeal itself. 136Mr McEwen's costs submissions were based on communications between the parties, as mentioned at [7]-[11] above, and included in Exhibit G1 (see T 11.02.11, pp44, LL46-p46, L41). The position may be summarised as follows: (1) On 3 February 2011 the respondents' solicitors wrote to the appellant and proposed conceding ground 1 on the basis that the appellant abandon grounds 2-4. Then the only remaining question would be the remitter. If there was no agreement, the respondents would rely on their letter and offer on the issue of costs; (2) On 7 February 2011 the appellant Council's solicitors wrote offering not to press ground 3 if the respondents conceded grounds 1, 2 and 4 and agreed to an exclusionary remitter; (3) The respondents' solicitors wrote again on 9 February 2011 enclosing their submissions, again conceding ground 1, and reiterating the above offer. The letter again asked for clarification of whether other grounds were pressed, so that costs may be avoided; and (4) On 9 February 2011 the appellant indicated that it would not press ground 3, but required the court to determine grounds 1, 2, and 4. 137Mr McEwen submitted (T 11.02.11, p46, LL31-41) that if the only error found was in the conceded ground 1 and an exclusionary remittal order was not made, then the respondents should have a proportion of their costs - he nominated 70%, but conceded it could be only 50% - from the date of the correspondence. 138As I have not been satisfied on any ground other than that conceded by the respondents, and as the appellant also failed to convince me to make an exclusionary remittal order, costs should not follow the event simpliciter . Although ground 1 was conceded, Mr Galasso submitted that that would not have occurred if the appellant had not challenged the outcome of the class 1 appeal. On that basis the appellant should have an order for its costs prior to the concession. 139The respondents did not concede any other grounds, and argued that they should not be pressed. The appellant chose not to press ground 3, but the respondents were successful on grounds 2 and 4. The appellant convinced neither the respondents nor the court that the matter ought to be remitted to a different Commissioner. 140The respondents should, therefore, have at least some of their costs after their concession.

Orders 141I, therefore, make the following orders: (1) The appeal is allowed in part, and t he decision of Commissioner Brown is set aside so far as it displays an error of law in relation to objective in cl 11A(1)(d)(iii) of the relevant LEP. (2) The appeal is otherwise dismissed. (3) The matter is remitted to Commissioner Brown for further consideration in the light of these reasons. (4) The respondents are ordered to pay the appellant's costs of this appeal up to and including 3 February 2011, and the appellant is ordered to pay 50% of the respondents' costs of the appeal subsequent to that date. (5) The exhibits may be returned. 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: 03 November 2011