Ku-ring-gai Council v Minister for Planning & Anor

Land and Environment Court (NSW)|2008-07-01|Before: Biscoe J, Commission J

CITATION : Ku-ring-gai Council v Minister for Planning & Anor [2008] NSWLEC 174

APPLICANT: Ku-ring-gai Council

PARTIES : FIRST RESPONDENT: Minister for Planning

Judicial Review :- Validity of order by Minister for Planning appointing a planning panel under s 118(1)(b) of Environmental Planning and Assessment Act 1979 - whether invalid on any of following grounds - whether failed to take into account a mandatory relevant consideration - whether failed to obtain concurrence of Minister for Local Government as required by s 118(8) - whether invalid because of prior Ministerial direction made under s 55 - whether denial of procedural fairness - whether council was functus officio in respect of functions vested in the panel - whether Minister estopped from denying that the jurisdiction of the panel extended only to the area within the council's draft local environmental plan. KEY ISSUES: Estoppel: - order by Minister for Planning appointing a planning panel under s 118(1)(b) of Environmental Planning and Assessment Act 1979 - whether Minister estopped from denying that the jurisdiction of the panel extended only to the area within the council's draft local environmental plan.

Environmental Planning and Assessment Act 1979 (NSW), ss 54, 55, 65(1), 68(4), 68(9), 69, 70, 73A, 118, 123, Pt 3, Pt 6 Div 1AA Environmental Planning and Assessment (Ku-ring-gai Council Planning Panel) Order 2007 LEGISLATION CITED: Environmental Planning and Assessment (Ku-ring-gai Planning Panel) Order 2008 Environmental Planning and Assessment (Ku-ring-gai Council Planning Panel) (Repeal) Order 2008 Environmental Planning and Assessment (Unsatisfactory Council Performance) Order 2007 Interpretation Act 1987 (NSW), ss 5(2), 48(1)

Ainsworth v Criminal Justice Commission (1992) 175 CLR 564 Anderson v Minister for Infrastructure Planning and Natural Resources (2006) 151 LGERA 229 Annetts v McCann (1990) 170 CLR 596 Attorney-General for the State of New South Wales v Quin (1990) 170 CLR 1 Balmain Association Inc v Planning Administrator for the Leichhardt Council (1991) 25 NSWLR 615 Commissioner for Australian Capital Territory Revenue v Alphaone Pty Ltd (1994) 49 FCR 576 Falkiner v Director-General of Planning NSW (2002) 125 LGERA 138 Grundt v The Great Boulder Proprietary Gold Mines Ltd (1937) 59 CLR 641 Kioa v West (1985) 159 CLR 550 Mahon v Air New Zealand Ltd [1984] 1 AC 808 Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1985) 162 CLR 24 CASES CITED: Minister for Immigration and Ethnic Affairs v Kurtovic (1990) 21 FCR 193 Minister for Immigration and Multicultural Affairs v Bhardwaj (2002) 209 CLR 597 Pilbara Aboriginal Land Council Aboriginal Corporation v Minister for Aboriginal and Torres Strait Islander Affairs (2000) 103 FCR 539 Pongrass Group Operations Pty Ltd v Minister for Planning (2007) 156 LGERA 250 Re Minister for Immigration and Multicultural Affairs; Ex parte "A" (2001) 185 ALR 489 Re Minister for Immigration and Multicultural Affairs; Ex parte Miah (2001) 206 CLR 57 Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam (2003) 214 CLR 1 Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Palme (2003) 216 CLR 212 Richmond v Minister for Urban Affairs & Planning [2000] NSWLEC 23 SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs (2006) 228 CLR 152 Thompson v Palmer (1933) 49 CLR 507 Waltons Stores (Interstate) Limited v Maher (1988) 164 CLR 387

APPLICANT: Mr M. Neil QC and Ms M. Allars SOLICITORS Deacons

LEGAL REPRESENTATIVES: FIRST RESPONDENT: Mr A. Galasso SC and Ms R. Pepper SOLICITORS Department of Planning

SECOND RESPONDENT: Submitting appearance

JUDGMENT: THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES

JUDGMENT 1 HIS HONOUR: On 3 March 2008 the Minister for Planning made the Environmental Planning and Assessment (Ku-ring-gai Planning Panel) Order 2008 (2008 order) appointing the Ku-ring-gai Planning Panel (Panel) to exercise certain functions of Ku-ring-gai Council. The Council challenges the validity of the 2008 Order.

POWER TO APOINT A PLANNING PANEL 2 The Minister appointed the Panel pursuant to s 118(1)(b) of the Environmental Planning and Assessment Act 1979 (NSW) (EPA Act). Section 118 relevantly provides: (1) The Minister may appoint a planning administrator or a panel (or both) to exercise functions of a council if: … (b) the Minister is of the opinion that the performance of a council in dealing with planning and development matters (or any particular class of such matters) is unsatisfactory because of the manner in which the council has dealt with those matters, the time taken or in any other respect…

(2) A planning administrator may be appointed to exercise all or any particular function or class of functions of the council under this Act. (3) A panel may be appointed to exercise only all or any particular function or class of functions of the council: (a) as a consent authority under Part 4, or (b) in relation to making of environmental planning instruments under Part 3. …

(7) A planning administrator or panel is to be appointed by order of the Minister published in the Gazette. (8) Before appointing a planning…panel, the Minister is to obtain the concurrence of the Minister for Local Government. (9) The Minister may appoint a planning…panel for a reason set out in subsection (1)(b) only if the Minister has, by order published in the Gazette, provided heads of consideration for the exercise of power under subsection (1)(b), and has taken those heads of consideration into account. 3 Before appointing the Panel the Minister: (a) expressed the opinion referred in s 118(1)(b), and (b) by order published in the Gazette, provided heads of consideration for the exercise of the power under s 118(1)(b), as required by s 118(9).

THE 2008 ORDER 4 The 2008 Order included the following provisions: 2 Definitions

(1) In this Order: dual occupancy means 2 dwellings (whether attached or detached) on one lot of land. Ku-ring-gai town centres means the area of land shown edged heavy black on the maps 1-6 in Schedule 1. the Act means the Environmental Planning and Assessment Act 1979 . the Council means the Ku-ring-gai Council. the Panel means the planning assessment panel listed in Part 1 of Schedule 5B to the Act with the corporate name Ku-ring-gai Planning Panel .

3 Amendment of Schedule 5B to the Act to establish the Panel Part 1 of Schedule 5B to the Act is amended by inserting the following matter in alphabetical order: Ku-ring-gai Planning Panel 4 Appointment of Panel to exercise the Council's planning functions (1) The Panel is appointed to exercise all functions of the Council: (a) as a consent authority under Part 4 of the Act, but only in relation to: (i) the assessment and determination of any development application for development with an estimated cost of more than $30,000,000, and (ii) the assessment and determination of any development application that has not been determined within 90 days after the date on which it was lodged, and (b) in relation to the making of environmental planning instruments under Part 3 of the Act, but only in relation to: (i) the control of dual occupancy, and (ii) the control of development within the Ku-ring-gai town centres. …

(4) The functions that the Panel may exercise in relation to the making of environmental planning instruments under Part 3 of the Act extend to the making of any plan (such as draft Ku-ring-gai Local Environmental Plan 2006 (Town Centres) ) whose making commenced before the commencement of this Order. (emphasis added) 5 The six maps in Schedule 1 to the 2008 Order, referred to in the definition of "Ku-ring-gai town centres" in cl 2(1), define the areas of the town centres in Gordon, Lindfield, Pymble, Roseville, St Ives and Turramurra. Those areas are much larger than the areas in the corresponding maps in the Council's draft Ku-ring-gai Local Environmental Plan 2006 (Town Centres) (Draft LEP) which it submitted to the Department of Planning in 2006.

6 Those much larger areas in the 2008 Order maps are driving this litigation because the Council disagrees that the town centres should be much larger than proposed in its Draft LEP. However, as these are judicial review proceedings, the Court has no jurisdiction to consider the merits of those areas or any other merit issue. Judicial review is concerned with the limits of legality and not with the merits of the decision. As Brennan J said in Attorney-General for the State of New South Wales v Quin (1990) 170 CLR 1 at 35-36: The duty and jurisdiction of the court to review administrative action do not go beyond the declaration and enforcing of the law which determines the limits and governs the exercise of the repository's power. If, in so doing, the court avoids administrative injustice or error, so be it; but the court has no jurisdiction simply to cure administrative injustice or error. The merits of administrative action, to the extent that they can be distinguished from legality, are for the repository of the relevant power and, subject to political control, for the repository alone. 7 It is, therefore, not for the Court to ask whether the Minister's decision to make the 2008 Order was right. The relevant question is about the Minister's processes, not his actual decision: SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs (2006) 228 CLR 152 at [25].

GROUNDS OF CHALLENGE 8 The grounds of challenge to the validity of the 2008 Order are that the Minister: (1) failed to take into account a relevant consideration he was bound to take into account, namely, that the Council had taken measures to meet the residential yield requirements of the NSW government's Metropolitan Strategy by the combined effect of the Draft LEP for the town centres and its " Principal LEP " which was under preparation by the Council for the whole of its local government area; (2) failed to obtain the concurrence of the Minister for Local Government as required by s 118(8) of the EPA Act; (3) in relation to a direction made under s 55 of the EPA Act on 27 May 2004 by a former Minister ( s 55 Direction ): (a) acted in excess of power under s 118, or (b) alternatively, failed to take into account a mandatory relevant consideration, namely, the s 55 Direction; (4) denied the Council procedural fairness and this amounted to a jurisdictional error; (5) acted in excess of his power under s 118 of the EPA Act because the Council was functus officio in respect of the functions which cl 4(1)(b)(ii) of the 2008 Order purported to vest in the Panel; and (6) acted in excess of his power under s 118 of the EPA Act in relation to cl 4(4) of the 2008 Order.

9 In addition, by a Reply filed during the hearing, the Council claims that the Minister is estopped from denying that the jurisdiction of the Panel, if any, in relation to the making of an LEP extends only to the area of land within the Council's Draft LEP.

Factual background 10 In the s 55 Direction of 27 May 2004 (referred to at [8(3)] above) the Minister directed the Council: (a) to perform all of its functions under Division 4, Part 3 of the Act, to prepare a draft local environmental plan for areas in close proximity to the railway line and Pacific Highway and the St Ives Centre which are zoned Residential "D", "E", "F" and "H" and 3(a) and 3(b) under Ku-ring-gai Planning Scheme Ordinance; (b) to exercise its functions under Division 4, Part 3 of the Act, in relation to the preparation of the draft local environmental plan, in accordance with the principles set out in Schedule A; (c) to include in the draft local environmental plan provisions which achieve or give effect to the principles specified in Schedule A; and (d) to submit the draft local environmental plan to the Director-General of the Department of Infrastructure, Planning and Natural Resources under section 68 of the Act within 12 months of the date of this Direction.

11 Schedule A to the s 55 Direction stated: Principles 1. To encourage the provision of housing that will broaden the choice of building types and locations available in the housing market and to make more efficient use of existing infrastructure and services. 2. To revitalise the existing retail/commercial areas. Aims 1. To rezone land to facilitate the development of multi-unit housing and increase housing choice particularly in the form of "shop-top" housing. 2. To improve the development standards so as to encourage the redevelopment of land in the existing multi-unit housing zones. Objectives 1. To include provisions which allow for the redevelopment of land for multi-unit housing consistent with the development standards contained in LEP 194. 2. To provide for retail and commercial activities to cater for the local community and to implement housing density standards which compliment those contained in LEP 194.

12 Council staff prepared land use study reports based on study areas chosen to be investigated so as to develop a Draft LEP which would comply with the s 55 Direction. The study reports were completed for each of the Gordon, Roseville, Lindfield, Pymble, St Ives and Turramurrra areas, and presented to the Council prior to recommended rezonings under the LEP.

13 In December 2005 the New South Wales Government published the Metropolitan Strategy City of Cities - A Plan for Sydney's Future (Metropolitan Strategy). It stated: Sydney's population is anticipated to grow by 1.1 million people between 2004 and 2031, from a current population of 4.2 million to 5.3 million by 2031. To cater for this growth, the Government has predicted we will require the following: · 640,000 new homes; · 500,000 more jobs are being planned for over the next 25 to 30 years; · 7,500 hectares of extra industrial land if current trends continue; · 6.8 million square metres of additional commercial floor space; and · 3.7 million square metres of additional retail space.

Even if we have zero population growth over that time, i.e. our births and migration equal deaths, we would still require 190,000 new homes in Sydney to respond to demographic changes where fewer people are living in each home.

14 Table 8 prescribed the number of new dwellings required for each local government area by 2031, including 21,000 new dwellings for Hornsby and Ku-ring-gai. Subsequently, the councils for Hornsby and Ku-ring-gai agreed that the Ku-ring-gai target would be 10,000 new dwellings by 2031.

15 In 2006 the Council exhibited and subsequently adopted the Draft LEP, which contained maps for the "Town Centres" of Gordon, Roseville, Lindfield, Pymble, St Ives and Turramurra. The maps were each entitled "Draft Ku-ring-gai Local Environmental Plan 2006 (Town Centres) Land Application Map". This was notwithstanding that the s 55 Direction did not refer to town centres.

16 In 2006 the Council progressively submitted the Draft LEP, including these maps, to the Director-General of the Department of Planning (Department) in accordance with s 68(4) of the EPA Act. The Director-General issued certificates under s 65(1) of the EPA Act certifying that the Draft LEP in respect of two of the town centres could be publicly exhibited and, in respect of the remainder, authorised the issue of certificates by the Council as delegate.

17 As required by s 118(9) of the EPA Act, by the Environmental Planning and Assessment (Unsatisfactory Council Performance) Order 2007 (the HOC Order) gazetted on 20 July 2007, the Minister provided heads of consideration (HOCs) for the exercise of power under s 118(1)(b). The HOC Order commenced on 1 August 2007.

18 By letter dated 12 October 2007 the Minister requested the Council to show cause as to why a planning panel should not be appointed under s 118(1)(b) of the EPA Act. Given the nature of the grounds of challenge to the validity of the 2008 Order, it is necessary to quote much of this lengthy letter. It relevantly stated: I am writing in relation to my ongoing communications with Council concerning strategic planning for the Ku-ring-gai local government area (LGA).

The LGA has been identified as an area of significance in the North subregion under the Metropolitan Strategy: City of Cities ( Metropolitan Strategy ). Appropriate strategic planning for the LGA is therefore imperative if the outcomes identified in the Metropolitan Strategy are to be successfully achieved.

You will be aware the Department has been working closely with Council for many years to ensure these strategic outcomes are achieved. While I acknowledge the more recent attempts of you as Mayor in seeking to resolve planning issues, I remain concerned that the actions taken by Council as a whole have not addressed the matters that have been repeatedly identified by myself, previous Ministers and the Department, particularly those related to various draft local environmental plans for the six town centre areas.

As a result of these concerns, I am currently giving consideration to the appointment of a planning panel under s. 118 of the Environmental Planning and Assessment Act 1979 (EP&A Act) to undertake the following council functions:

(a) consent authority under Part 4 of the EP&A Act with respect to: (i) development with an estimated cost of more than $10 million; (ii) development applications which have not been determined within 3 months of lodgement; and (iii) s. 82 determinations (b) local environmental plan making functions under Part 3 of the EP&A Act (in particular a principal LEP for the LGA, incorporating the six town centres). A panel may be appointed under s. 118(1)(b) of the EP&A Act where the performance of a council in dealing with planning and development matters is, in my opinion, unsatisfactory.

Before appointing a panel on this basis, I am to have regard to the heads of consideration contained in the Environmental Planning and Assessment (Unsatisfactory Council Performance) Order 2007 which was made on 19 July 2007.

Before making a final decision in this instance, and for reasons of procedural fairness, I am writing to request Council to show cause why a panel should not be appointed under s. 118(1)(b).

Attached at Appendix 1 is a document outlining the areas where, I am advised, Council's performance against the heads of consideration has been unsatisfactory. I invite the Council to provide a written submission within 21 days of the date of this letter responding to the areas of concern identified in Appendix 1.

I will consider the Council's written submission before making a final determination on whether a panel should be appointed in this instance.

The Department has also previously expressed concern in respect of the Ku-ring-gai Town Centres Development Control Plan (DCP) made by the Council on 6 November 2006 (but not yet commenced) and proposed amendments to the DCP. The outstanding matters of concern in respect of the DCP are outlined at Appendix 2 .

I invite Council to provide a written response within 21 days of the date of this letter showing cause why a s. 74F direction should not be issued in this instance having regard to the matters identified in Appendix 2 .

I would appreciate your urgent attention to these matters.

This review represents an assessment of the performance of Ku-ring-gai Council against the heads of consideration established in the Environmental Planning and Assessment (Unsatisfactory Council Performance Order) 2007 . …

(ii) Time taken to make LEPs or DCPs A. Town Centres LEP

Council was directed on 27 May 2004 by the then Minister to prepare a draft LEP for areas in close proximity to the railway line and Pacific Highway and the St Ives Centre. The process was to be completed within 12 months. Rather than non-compliance with the terms of the s55 direction, the concern here is the time taken for the Council to undertake its functions under Part 3 of the Act.

In December 2006, the Council provided draft plans for 6 town centres to the Department under s68 of the Act, however the draft plans were deficient in many respects. These include the failure to deliver strategic outcomes that result in increased yield for residential, commercial and retail development and the failure to reclassify any Council land within the relevant town centres.

After requesting a timetable from the Council in September 2005, the Minister received correspondence from the Council that same month indicating a range of gazettal dates for the 6 centres. These dates varied from June 2006 to May 2008.

In February 2006, the Minister expressed dissatisfaction with the Council's proposed program for delivery of the LEPs. The Minister required the Council to process the 6 town centre LEPs concurrently with only one stage of consultation and no preliminary (non-statutory) exhibition.

The Council by letter on 20 February 2006 agreed a work program for all 6 town centres which indicated completion of all 6 town centres by December 2006.

Council's time for processing the draft LEPs has been suboptimal having regard to the following actions by the Council:

· a stagnation of the process between 9 May 2006 and 10 July 2006, supported by Council's own correspondence which indicates no relevant progression on the LEPs. · the inability of the Council to properly identify land to which the LEPs should relate, especially the exclusion of some land in close proximity to railway stations. · extensive non-statutory exhibition and consultation periods. · inclusion of inappropriate controls within the draft LEPs resulting in a need for conditional authorisations for delegation and conditional section 65 certificates to be issued. · failure to provide early indication of development yields and inclusion of superfluous controls in the draft instruments. · failure to manage the process of reclassification of Council land effectively (i.e. those aspects of reclassification related to LEP making). · failure to manage the reclassification of Council land in a timely manner.

The Council has indicated that it considers it has met the time frame for preparing the LEPs of December 2006. However the draft LEPs are not complete given that further work is needed to ensure compliance with the yield requirements as a result of the Metropolitan Strategy, the exclusion of superfluous and restrictive controls, the identification and reclassification of Council land.

The Council has taken an inordinate amount of time to undertake the rezoning process for the Town Centres given that the process began in May 2004. The rezoning is still not complete…

C. DCP 55 - Railway/Pacific Highway Corridor and St Ives Centre…

Again, the Council's inclusion of inappropriate controls in DCP 55 are still in place and there has been an unwillingness to amend it… (iii) Classes of exempt and complying development

The Council has drafted overly complex exempt and complying development provisions relating to the Town Centres LEP. In some circumstances the provisions are inconsistent with SEPP 4 and contain requirements that overly restrict the exempt and complying development categories.

The Department has requested the Council on a number of occasions to revise the categories of exempt and complying development. Most recently, the Department wrote to the council in April 2007 providing extensive feedback on the categories of exempt and complying development.

The Council has not provided the Department with any clear time frame for settling the categories of exempt and complying development and this is unacceptable given that this process ought to be concurrent with and be finalised with the draft LEP and DCP. (iv) Council's response to public submissions on draft LEPs or DCPs The Department is aware of and has received a number of submissions from members of the public in relation to the Town Centres LEP and DCP. The submissions generally express concern about whether the proposed development standards in the draft LEP and provisions of the DCP will act as a disincentive to the orderly and economic development of land, given the restrictive nature of the provisions and the proposed listing of heritage sites.

It is evident from the draft plans submitted in December 2006 including the proposal to list 14 more heritage items in the area, that the Council has not responded adequately to the public submissions in relation to these draft instruments. … [Under cl 4(f) of the HOC Order] …

(ii) Endorsed strategies and policies, planning and development matters The Department requested the Council to address outstanding issues associated with the Town Centres LEP in correspondence and meetings prior to Council providing its s68 submission to the Department in late December 2006. Many of the substantial matters raised in 2006 have not been addressed and were raised again in correspondence from the Department to Council including by letter dated 4 July 2007. The Metropolitan Strategy encourages urban consolidation through an appropriate mix of medium to high density residential, commercial and retail development. This is achieved through higher FSRs and less restrictive development controls to encourage a higher yield on development sites. The Council has nominated sites in the Town Centres LEP for FSRs either the same or potentially less than is currently available. The yields provided by the Council are unrealistic given the restrictive standards proposed in the LEP and DCP. The Department has sought a removal of these restrictions in order to realise the potential yields and has sought from the Council a more realistic estimate of yields. A preliminary estimate by the Department identifies that even with relaxation of standards, it is unlikely that St Ives would reach 62% of Council's estimates. This percentage includes sites already counted for in LEP 194 and assumes full take up on the sites included in the LEP. That estimate is therefore conservative.

For these reasons, the Council has failed to implement endorsed strategies for urban consolidation through the drafting of the Town Centres LEP and DCP …

[Under cl 4(j) of the HOC Order] (j) the public interest

It is incumbent on all Sydney metropolitan Councils to achieve the targets set by the Metropolitan Strategy. Ku-ring-gai is identified as a major area of significance in the North subregion. By agreement with Hornsby Council, Ku-ring-gai Council will accommodate 10,000 more dwellings by 2031. The Town Centres LEP is a major step and tool for the Council to achieve this goal.

The Council is however hampering the progress of achieving these goals through a poorly managed rezoning process for the Town Centres LEP. There are also persistent issues with the determination and yield from DAs especially in relation to dual occupancies and medium to high density residential developments.

For these reasons, the Council's actions to date in relation to its functions under Part 3 and Part 4 of the Act have not been in the public interest. Matters which support that conclusion include: Part 3 functions · Lack of certainty to achieve the yields stipulated by Council given the restrictive controls proposed under the LEP and DCP. · Inaccurate yield estimates as a result of restrictive controls or inclusion of yields previously counted from LEP 194 and LEP 200. · Substantial delay in finalising the Town Centres LEP and DCP. · Failure to provide a meaningful and workable alternative to SEPP 53 in relation to dual occupancies. · Failure to take a strategic planning approach to the Town Centres including transport corridor considerations. · Inadequate reasons for rezoning proposals which result in piecemeal rezoning and lack of buffers around high density sites. · Confusion in the community through multiple LEP and DCP consultation processes. · Lack of certainty concerning the reclassification of Council land. · Failure to comply with conditions attached to s65 certificates and delegation authorisations. · Continual failure to address matters raised by the Minister and Department including requests to demonstrate the capacity to deliver the Metropolitan Strategy targets and to rezone more land around railway stations. Part 4 functions · Long development assessment periods. · High level of refusals and low rate of approvals for dual occupancy and medium to high density residential development. The Council's failure to exercise its functions under Parts 3 and 4 of the Act in an appropriate and efficient manner is contrary to the expectant level of diligence of a local government authority.

19 By letter dated 2 November 2007 the Council replied to the show cause letter addressing each of the heads of consideration. The letter stated, among other things: We have planned for:

· 10,300 new dwellings in stage 1 · 4,500 new dwellings in stage 2 (town centres) · 5,000 additional dwellings through Dual occupancy, SEPP5 etc. · 2030 total = 20,000 new dwellings. …

We propose that we keep our present planning powers and instead work with you and your Department to resolve outstanding issues for our six town centre plans.

To assist this process, it is suggested that we jointly appoint an independent planner to review the following matters: … · Residential yields … 20 The submission attached to this letter said that the Council "is confident that it can achieve the agreed 10,000 dwellings under LEP 194, 200 and the Town Centre LEP and DCP and the Principal LEP"

21 A meeting to discuss the Council's response was held on 22 November 2007 between Mayor Nick Ebbeck, Deputy Mayor Anita Andrew, the Council's General Manager John McKee, the Council's Director of Development and Regulation Michael Miocic, the Council's Manager of Urban Planning Antony Fabbro, the Minister and members of the Department. According to the Mayor, who was the only person to give evidence of this meeting, the Minister stated that there was no intention to expand the areas covered by the Draft LEP maps. The Minister did not give evidence but denies this in his pleading. The Mayor's evidence was challenged in cross-examination. Two submissions are made for the Minister. First, that it is unnecessary to decide the issue. Secondly and alternatively, that the Mayor's evidence is inconsistent with his note of the meeting, the Mayor should therefore be regarded as an unreliable witness, and this should lead the Court to decline to act on the basis of his disputed account of this and subsequent conversations between the Minister and him.

22 On 14 December 2007 the Minister made the Environmental Planning and Assessment (Ku-ring-gai Council Planning Panel) Order 2007 (2007 Order), which established the Ku-ring-gai Council Planning Panel (the 2007 Panel) and provided for certain functions of the Council to be performed by the 2007 Panel. The 2007 order commenced operation on 21 January 2008. The functions vested in the 2007 Panel were described in cl 5. Clause 5(1)(b)(ii) was in the same terms as cl 4(1)(b)(ii) of the 2008 Order (set out above at [4]). The town plan maps were incorporated by reference in the 2007 Order rather than by physical incorporation as with the 2008 Order.

23 By letter dated 17 December 2007 the Minister notified the Council of the appointment of the 2007 Panel and enclosed a copy of the 2007 Order but did not enclose any map nor any statement of the reasons for the decision.

24 On 17 December 2007 Mr Craig Wyse, the Council's Team Leader of Urban Planning, received from Mr Peter Adrian in the Department an email which attached maps.

25 On 17 December 2007 there was a telephone conversation between the Minister and the Mayor. According to the Mayor, the Minister said that he had no intention for the maps to reflect anything different from the Draft LEP maps. The Minister denies this allegation in his pleading.

26 On 20 December 2007 the Mayor faxed a letter to the Minister in which he expressed anger that the 2007 order had "enlarged the land areas of the six town centres ranging from 77% in Lindfield to 525% in Pymble, an average increase of 216% across the centres". He said that the increases "will enrage our community".

27 Later that day there was a telephone conversation between the Mayor and the Minister. According to the Mayor, the Minister said: "The panel is put in place to resolve the LEP and will be based on what is lodged. There is no intention to go outside that". The Minister denies this allegation in his pleading.

28 Later still that day, the Minister faxed the following letter to the Mayor: I refer to my recent decision to appoint an independent panel under section 118 and 118AA of the Environmental Planning and Assessment Act 1979 (EP&A Act) for certain planning functions within the Ku-ring-gai local government area.

I am aware of your concerns regarding the extent of the physical area within which the Panel's responsibilities will be exercised. For legal reasons, the map included with the Order is consistent with the extent of the original study area and also with the expressed intent of Minister Beamer's Section 55 Direction in 2004.

As discussed, there is no intention to make the LEP boundaries for the centres substantially bigger than the draft LEP submitted by the Council.

In the event that there are any significant inconsistencies between the Council's draft LEP boundaries and the final LEP boundaries recommended to me by the Panel, I am prepared to consult with you before I make any final decision. 29 By letter dated 11 January 2008, the Department provided the Council with maps, which were described as those deposited in the Department and referred to in cl 3 of the 2007 Order. They were identical to the maps attached to the email of 17 December 2007. They showed town centres that were much larger than those in the Draft LEP maps.

30 On 15 January 2008 there was a telephone conversation between the Minister and the Mayor about the enlarged town centres maps. According to the Mayor, the Minister said: "I sent you a letter before Christmas. It's not my intention that the panel deal with an area larger than the LEP town centre. It was never my intention. I have sent you a letter to this effect". The Minister did not give evidence but denies saying this in his pleading.

31 By facsimile dated 17 January 2008, Mr Marcus Ray of the Department's Legal Services Branch replied on the Minister's behalf, noting the contents of the Minister's letter dated 20 December 2007.

32 On 18 January 2008 the Council commenced the present proceedings pursuant to s 123 of the EPA Act seeking injunctive and declaratory relief in relation to the Minister's decision to make the 2007 Order.

33 By letter dated 25 January 2008 to the Council's solicitors, Deacons, Mr Ray of the Department's Legal Services Branch said that the Minister was considering repealing the 2007 Order and invited the Council to make submissions on the enclosed "draft proposed order" and a draft order to repeal the 2007 Order.

34 On 31 January 2008 the Council filed an Amended Application so as to seek relief to prevent or restrain the making of the 2008 Order.

35 On 1 February 2008 Mr Marcus Ray of the Department's Legal Services Branch wrote to Deacons enclosing "the planning reasons, relating to the area of the Ku-ring-gai town centres, provided to the Minister which supports his decision to seek your submission on the proposed draft Order". Those reasons were almost five pages in length and included the following: For the Planning Panel to be able to recommend a draft LEP to the Minister that implements the Metropolitan Strategy and achieves the additional 10,000 dwellings required by the NSW Government, it is important for the Panel to fully review all of Council's work for the town centres, including adequate study areas.

It is the Department's view that the area covered by Council's draft LEP is too small an area to achieve these planning outcomes. Council's own study areas which informed the draft LEP were significantly bigger than the areas included in the draft LEP as exhibited and submitted.

For the purposes of the appointment of a Planning Panel for Ku-ring-gai, including LEP making functions for six of the Town Centres within the local government area, the Department has prepared a set of 6 maps. The map boundaries for the planning Panel are identified with a heavy black line.

The boundaries delineated on the maps for the Planning Panel are based on Council's own original study areas and provide a walkable catchment for the community in each of the centres to shops, officers, and public transport (in particular, the railway stations for all but one centre and the bus stops along the Pacific Highway and Mona Vale Road).

It is clear that authorising the Panel to have LEP making functions for these boundaries will enable the Panel to submit to the Minister a draft LEP that contains appropriate planning controls and zonings for the town centres to implement the Metropolitan Strategy and achieve the required additional 10,000 dwellings. This may result in the draft LEP to be submitted by the Panel covering larger and/or different area to the draft LEP exhibited and submitted by Council.

Restricting the Panel's operation to the areas in Council's draft LEP may make it unlikely for the Panel to submit an appropriate draft LEP that achieved these outcomes.

36 By letter dated 8 February 2008 the Council by its solicitors, Deacons, made a submission to the Minister on the "proposed draft order". It included the following: It is apparent, and the Council maintains, that the planning reasons contained in your letter, and provided to the Council for the first time with your letter, do not support the proposed draft order.

The Council says that the position as set out in your letter is completely inconsistent with the Minister's communications with the Council about the Panel's jurisdiction. We refer to the meeting with the Minister and members of the Department on 22 November 2007. We also refer to the Minister's conversations with the Mayor on 20 December 2007 and the Minister's letter to the Mayor dated 20 December 2007 where the Minister stated that:

As discussed, there is no intention to make the LEP boundaries for the Centres substantially bigger then [sic] the Draft LEP submitted by the Council.

The Minister's position was further emphasised in the letter from the Department's Marcus Ray to the Mayor dated 17 January 2008 where he stated that

I note the Minister's further letter to you of 20 December 2007 explaining:…there is no intention to make the final LEP boundaries substantially bigger than the boundaries in the Draft LEPs submitted by the Council…

We are instructed that the Council also says that the planning reasons that have been provided are flawed and cannot be relied upon for the proposed draft order for several reasons, including:

As the Department would be aware, the Draft Sydney North Subregional Strategy is based upon an additional 10,000 dwellings being achieved over phased program up to 2031 and Council is well on track in responding to the phased program of 10,000 additional dwellings. Many of the facts and assumptions are incorrect. For example, the reasons assert that there is doubt as to the Council's ability to consider, approve and achieve the subsequent development of the NSW dwelling target of an additional 10,000 dwellings to which Ku-ring-gai Council has agreed . The reasons are contrary to available data and expert analysis and indeed earlier discussions with the Department. The Council is confident that it can meet the target. It has always understood that the 10,000 dwellings required from Ku-ring-gai to meet the Draft Sydney North Subregional dwelling targets will be achieved from the town centre areas and other areas within the overall Ku-ring-gai LGA, not solely from the Town Centres as implied in your letter. We refer to the Council's letter to the Minister dated 2 November 2007 where Council advised that it has planned for 10,300 new dwellings in stage 1 and 4,500 new dwellings in stage 2 (town centres) and 5,000 additional dwellings through Dual Occupancy, SEPP5 with a total by year 2030 of 20,000 new dwellings. These calculations did not then include the UTS or SAN sites or other sites to be included in the Principal LEP.

The methodology that has been used in defining town centres and villages is not correct. Nor has it been applied in a coherent and consistent manner in the proposed planning reasons or by the Department in other local government areas. The methodology contains several errors. They include: (1) The Pymble centre is a small village (400m radius) under the Draft North Subregional Strategy and will remain as small village based on the location of the centre being nearby to Turramurra and Gordon, physical land constrains [sic] and economic considerations. There is no capacity or option for the centre to grow to a Village centre.

(2) Lindfield is incorrectly identified as small village when it should really be a Village with a 600m radius. 3. The proposed approach will result in delay and significant additional costs. The Council, the Council's consultants and the community have spent considerable time and cost in fully investigating and preparing the Town Centre LEPs. We refer to the affidavit of Antony Fabbro sworn 25 January 2008. It also means that there will be some overlap and inefficiencies in progressing the Principal LEP. Increasing the areas will create unnecessary duplication, complexity and uncertainty for the strategic policy work, decision making process and the community. The concerns with extending the areas of the Town Centres planning panel maps include; (1) Council has commenced the preparation of the Principal LEP through Stage 1 Town Centres LEP and is on track to complete the remainder of the Principal LEP and submit it to the Department by late 2010.

(2) A range of comprehensive studies and strategies have commenced for the Principal LEP such as the vegetation mapping, biodiversity planning, integrated transport planning, interface planning and heritage planning (including heritage items and conservation area reviews). The larger planning panel town centre boundaries will need to take into account the abovementioned studies and plans, some of which will not be completed until late 2009.

(3) There is a potential issue in planning for catchments, as planning decisions could be made in isolation and without the complete picture being taken into account. Some of the environmental and heritage issues are considered on a catchment basis. Some of these catchments start within the planning panel boundary but extend to a significantly larger area or region for example, in planning for endangered ecological communities (eg Blue Gum High forest), this vegetation community is located along the main ridge corridors of the Railway/Pacific Highway, covered by the panel boundary but also extend to the east and west of the local government area.

(4) In 2006 Council attempted to prepare a Draft LEP to rezone certain sites at the interface between single residential zones and the 2 (d3) zones, to provide an intermediary medium density residential zone. A significant number of these sites are within the planning panel boundary, however the Department of Planning advised it would be unlikely to support such an LEP as it lacked strategic context. This highlights the importance of any new LEPs outside of the town centres LEP to be considered in a wider strategic manner and concurrent with the studies and strategies from the principal LEP being available.

(5) There could be an overlap of policy decisions creating confusion and uncertainty as a result of adding another layer and step to the Principal LEP process.

(6) The Town Centres consultation program was designed and focused on the Key Town Centres LEP area. Another round of community consultation and exhibitions to accommodate new areas within the planning panel boundary will have the potential to create confusion for the land owners, residents and the business community. This will be an additional process to the already completed town centres LEP program and the longer term Principal LEP consultation process. In terms of consultation with state agencies there may also be less efficiency as they would also be required to assess and comment on another separate planning process created by the planning panel boundaries.

The Council strongly maintains that the Minister should not make the proposed draft orders on the basis of such planning reasons and that any order made on the basis of such planning reasons is flawed.

37 On 25 February 2008 the Department made a submission to the Minister that the Panel should be appointed and the Minister approved that course. On 26 February 2008 the Minister wrote to the Minister for Local Government seeking concurrence, as required by s 118(8) of the EPA Act. On 28 February 2008 the latter wrote a letter of concurrence to the Minister. These events are considered in more detail at [46] - [56] below when considering the Council's second ground of challenge.

38 On 29 February 2008 the Minister made the 2008 Order and the Environmental Planning and Assessment (Ku-ring-gai Council Planning Panel) (Repeal) Order 2008 repealing the 2007 Order. 39 In a letter to the Council dated 29 February 2008 the Minister enclosed his reasons for appointing the Panel, including the following: The Minister has appointed the Ku-ring-gai Planning Panel because he has formed an opinion that Ku-ring-gai Council's ( the Council ) performance in relation to each head of consideration listed below is unsatisfactory for the reasons set out: · (b)(ii) The time the Council takes in exercising its functions in making LEPs or DCPs: LEPs The Council has frustrated the finalisation of the draft Town Centres LEP by amongst other matters, including inappropriate planning controls which have been identified by the Department. The Department has requested Council to remove these controls but the Council has not done so. The Department is also concerned about delays in developing planning controls for dual occupancy in the local government area where the current controls are currently inadequate.

DCPs The Town Centres Development Control Plan has not been amended adequately in response to detailed advice from the Department to Council in October 2006. These changes are considered essential for the Town Centres DCP to properly implement the Town Centres LEP.

· (c)(i) Time taken to assess and determine development and modification applications: Council's processing time for development applications under LEP194 and LEP200 is considered to be excessive. The Council has been one of the 20 NSW councils with the highest median determination times for development applications.

The most recent performance data for 2006/07 shows an increase in the mean gross time taken to assess development applications (as compared to 2005/06), despite the number of applications being dealt with by Council decreasing by more than 14%. Also, the percentage of appeals against Council decisions that were upheld in the Land and Environment Court is 10% above the state wide average.

· (f)(ii) Whether council has complied with endorsed strategies and policies concerning planning and development matters: Although Council agreed with Hornsby Council, under the Metropolitan Strategy, to a number of new dwellings being constructed in the Ku-ring-gai local government area over the next 24 years, the amount of housing which could be constructed under the draft Town Centres LEP and DCP would not contribute sufficiently to this number. The Department has requested Council to amend the LEP and DCP to address this shortfall. The Council has not done so. · (f)(iii) Whether council has complied with section 117 directions: The draft Town Centres LEP does not comply with former s117 Direction No 3 Business Zones and Direction No 21 Residential Zones in that the draft LEP may reduce the potential floor space area for development including residential flats and retail/commercial uses in all 6 centres. · (j) Public interest: The Council is hampering the progress of achieving the dwelling yield targets set under the Metropolitan Strategy, through a poorly managed rezoning process for the Town Centres LEP. There are also persistent issues with the determination of development applications especially in relation to dual occupancies and medium to high density residential developments. Therefore, the Council's actions to date in relation to its functions under Part 3 and Part 4 of the Environmental Planning and Assessment Act 1979 have not been in the public interest, because, amongst other matters: · the public has been deprived of the timely determination of development applications; · planning instruments, in particular, the Town Centres LEP contain inappropriate controls which unduly restrict development, including proposed high and medium density housing or make inadequate provisions along transport corridors; and · there have been substantial delays in finalising the Town Centres LEP and DCP.

Ground 1 40 Ground 1 is that in making the 2008 Order the Minister failed to take into account a mandatory relevant consideration, namely, that the Council had taken measures to meet the yield requirements of the Metropolitan Strategy by the combined effect of its Draft LEP for the town centres and its "Principal LEP" which was under preparation for the whole of its local government area.

41 The Council submits that it was never its intention that its Draft LEP alone should provide the whole of its target yield of an additional 10,000 dwellings in its local government area by 2031. Rather, it was to be achieved by a combination of its Draft LEP and its Principal LEP for areas outside the Draft LEP.

42 I note that the Principal LEP is work in progress. It does not yet appear in documentary form and the evidence does not disclose much about it.

43 There is an issue as to whether the Principal LEP was a mandatory consideration. Failing to consider a matter which a decision-maker is not bound to consider, but which is legitimate to consider, is not a legal error and cannot vitiate a decision: Anderson v Minister for Infrastructure Planning and Natural Resources (2006) 151 LGERA 229 at [38] - [41] where I reviewed the authorities. No express statutory provision required the Minister to consider the Principal LEP. The Council submits that there was an implied statutory requirement that it be taken into account. The submission invokes the familiar dictum of Mason J in Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1985) 162 CLR 24 at 40: …where the ground of review is that a relevant consideration has not been taken into account and the discretion is unconfined by the terms of the statute, the court will not find that the decision-maker is bound to take a particular matter into account unless an implication that he is bound to do so is to be found in the subject-matter, scope and purpose of the Act.

44 It is unnecessary to decide whether residential yields in the LEP (outside the town centres in the Draft LEP) were mandatory relevant considerations because, if they were, the material before the Minister demonstrates, in my opinion, that they were considered by him: (a) they were raised by the Council in its letter of 2 November 2007 to the Minister (being its reply to the Minister's show cause letter) where it set out the various ways in which it proposed to achieve a yield of 20,000 new dwellings by 2030: see [19] above; (b) the Council's solicitors' submissions to the Minister dated 8 February 2008 included a submission that the 10,000 dwellings target " will be achieved from the town centre areas and other areas within the overall Ku-ring-gai LGA, not solely from the Town Centres as implied in your letter ": see [36] above. Reference was then made to the Council's letter to the Minister of 2 November 2007; (c) the Department's submission to the Minister on 25 February 2008 ([37] above) noted that the Council considered " it is well on track to meet the Metropolitan Strategy's targets based on recent approval trends (without including development under LEP 194 or the 6 town centre plans) " and included references to the Principal LEP. 45 I reject Ground 1.

GROUND 2 46 Ground 2 is that in making the 2008 Order the Minister failed to comply with s 118(8) of the EPA Act because the Minister for Local Government did not give concurrence to the making of the 2008 Order containing Map 3 - Pymble or to the making of the Repeal Order. In oral submissions senior counsel for the Council elected not to press its challenge to the validity of the Repeal Order. Section 118(8) provides: Before appointing a planning administrator or panel, the Minister is to obtain the concurrence of the Minister for Local Government.

47 A Pymble map was included in the draft proposed 2008 Order sent by the Department to the Council's solicitors, Deacons, on 25 January 2008 with an invitation to make submissions: see [33] above.

48 On 25 February 2008 the Minister received a report from his Department recommending the appointment of the Panel. On the same date he signed his approval on the report and also signed an undated letter, which was enclosed with the report, to the Minister for Local Government in the following terms: …An issue which has emerged in the litigation relates to the area of land for which the Panel is to exercise the Council's local environmental plan making functions in relation to the six Town Centres.

On 25 January 2008, I wrote to the Council inviting it to provide any written submission that it wished to make in relation to the draft 2008 Order and the proposed appointment of a Panel under section 118(1)(b) of the Act. I have taken its response into consideration but remain of the opinion that the area delineated on the map attached to the Order is correct.

In addition to seeking your concurrence to the appointment of a new panel, I want to take this opportunity to seek your comments in relation to my proposal to issue a direction to the Council under section 118AD(1) of the Act to require the Council to provide the Panel with all necessary staff, facilities and documents to enable it to undertake its functions. These arrangements are the same as those which are in place in relation to the existing Panel.

Finally, while I do not intend at this stage to appoint the Planning Panel to carry out the function of reviewing development consents granted by the Council under s82A of the EP&A Act , I want to put you on notice that I may seek to give the Panel this function at a future date.

If you require any further information concerning the proposed appointment of the Panel, please contact my office.

I would appreciate it if you could provide me with a response as soon as possible. 49 The proposed 2008 Order attached to the undated letter signed on 25 February 2008 included the same Pymble map as had been sent to Deacons on 25 January 2008. However, that letter and its attachments were never sent to the Minister for Local Government.

50 Instead, a letter dated 26 February 2008 was sent in the same terms as the undated letter and with the same attachments with one exception - the Pymble map was different.

51 The Minister for Local Government replied by letter dated 28 February 2008 in the following terms: I am writing in reply to your letter of 26 February 2008 (your reference Y08/210) regarding the appointment of a planning panel to Ku-ring-gai Council.

I have considered the information provided in your letter and your request for my concurrence in relation to the appointment of a new planning panel. In accordance with section 118 of the Environmental Planning and Assessment Act 1979 (EP&A Act), I provide my concurrence for your intention to appoint a new planning panel with the proposed functions as provided in your letter.

In addition, I have noted your proposal to direct Council to provide the Panel with all necessary staff, facilities and documents to enable it to undertake its functions. I support this direction.

I note that you have advised that you may seek to give the Panel a function of reviewing development consents granted by the Council under s82A of the EP&A Act. I also concur with the addition of this function should you decide to include this.

I again support the appointment of the Panel as a positive step to address the concerns identified in your letter.

52 The Council submits that the Minister intended his letter of 26 February 2008 to seek concurrence to the earlier Pymble map, and that therefore the basis on which concurrence was sought was not the basis on which concurrence was given. 53 I do not accept the submission. The concurrence prescribed by s 118(8) is to the appointment of a planning panel, not to the form of the order. In any case, the concurrence that was sought was about the very same order that was ultimately made. The explanation for the change in the Pymble map is found in the Department's report of 25 February 2008 to the Minister which stated: The proposed Order appointing the new Panel is substantively in the same terms as the 2007 Order. The only area of difference is in relation to the boundaries for the Pymble Town Centre. The area of land in which the Panel will exercise each of its functions has been reduced and is similar to the areas to which the Council's various planning studies for the Pymble Town Centre applied, although includes some sites which remain relevant to the Panel's consideration. This amendment is outlined at Tag G . (emphasis added)

54 The reasons annexed to the Department's report, justifying the boundaries of the town centres, explained that the boundaries in the Pymble map were changed in response to Council's submissions of 8 February 2008 as follows: Council's submission on 8 February 2008 in response to the gazetted boundaries argued that Pymble did not have the capacity to grow to a Village due to its close proximity to Turramurra and Gordon, its physical land constraints and economic considerations.

In response to Council's submission, the map for Pymble has been amended to generally align with the study area originally used by Council. The exceptions to this are as follows:

· The majority of land that is within the 400m radii has been included - as this land remains within the catchment of a Small Village and therefore is directly relevant to the Panel's plan-making decision process; · The southern section of the Pymble boundary includes the land zoned as special uses - Government Laboratory and Army Depot - and the area of commercially zoned land either side of Bridge Street, north of Ryde Road on the western side of the Pacific Highway;

· Inclusion of the SEPP 53 site between Beechworth and Avon Roads known as Site 02 ;

· Inclusion of the entire Pymble Ladies College site that is currently zoned Special Uses 5(a) - School; and

· A small number of lots within the 400 metre radii have been excluded where for reasons of practicality (ie following a road boundary or the existing Council study boundary). The proposed boundary for Pymble ensures that the centre (as a small village) will still contribute to the Council area achieving the Metropolitan Strategy dwelling and employment targets.

55 This explanation makes tolerably clear that the old Pymble map was attached in error to the undated letter signed by the Minister on 25 February. This was rectified by substitution of the new Pymble map before the letter, otherwise in the same terms, was actually sent to the Minister for Local Government the next day. The Minister for Local Government's concurrence was referable to the new Pymble map.

56 The Council also submits that the terms of the Minister for Local Government's concurrence of 28 February 2008 falls short of concurrence with the 2008 Order for the additional reason that he concurred with the Minister's "intention" to appoint the Panel but did not concur with the appointment of the Panel nor with the functions described as being vested in the Panel. I do not accept the submission. Section 118(8) provides that "Before appointing a planning…panel, the Minister is to obtain the concurrence of the Minister for Local Government". The Minister's letter of 26 February to the Minister for Local Government recounted the history of the matter and (inter alia) sought his "concurrence to the appointment of a new panel". A copy of the draft 2008 Order was enclosed. Section 118(8) of the EPA Act requires concurrence to be obtained before the appointment. The concurrence is to a future appointment, which is not inappropriately described as an intention to appoint.

57 In my opinion, the Minister for Local Government gave the concurrence required by s 118(8) of the EPA Act.

58 I reject Ground 2. GROUND 3 59 Ground 3 is that the Minister acted in excess of power under s 118 of the EPA Act by making the 2008 Order, because it was inconsistent with the s 55 Direction made by a former Minister on 27 May 2004. The s 55 Direction has been set out at [10]-[11] above.

60 The Council submits that there is no power under s 118 to appoint a panel to exercise functions in a manner inconsistent with a direction under s 55, and that in the present case the geographic functions of the Panel under cl 4(1)(b) of the 2008 Order are inconsistent with the geographic functions in paragraph (a) of the s 55 Direction. The Council's argument is that its LEP functions were defined geographically by the s 55 Direction and thereafter there was no wider geographic function which could be conferred on a panel under s 118.

61 I do not accept the submission. Sections 54(1) and 55(1) provide: 54 Decision to prepare draft local environmental plan

(1) A council may decide to prepare a draft local environmental plan in respect of the whole or any part of the land within its area. 55 Directions from Minister for the preparation of local environmental plan

(1) The Minister may direct a council, or 2 or more councils jointly, to perform any function conferred or imposed on it or them under section 54 or any other provision of this Division within such time or period as is specified in the direction.

62 Clause 4(1)(b)(ii) of the 2008 Order provides: (1) The Panel is appointed to exercise all the functions of the Council: … (b) in relation to the making of environmental planning instruments under Part 3 of the Act, but only in relation to: … (ii) the control of development within the Ku-ring-gai town centres. 63 The "town centres" in the 2008 Order are defined as "the area of land shown edged heavy black on the maps 1-6 in Schedule 1". Those areas are much larger than the areas referred to in paragraph (a) of the s 55 Direction.

64 In my opinion, the Minister's power under s 118 is independent of and broader than his power under s 55. The former is not conditioned by the latter. The 2008 Order was expressly directed to "town centres" which was a defined term of art. The s 55 Direction did not mention town centres. The fact that the Council decided to use the expression "town centres" in its Draft LEP in response to the s 55 Direction should not be allowed to confuse the issue and, in any event, did not limit the exercise of the power under s 118. The Metropolitan Strategy post-dated the s 55 Direction and generated new yield considerations which lay at the heart of the exercise of power under s 118. Moreover, the s 55 Direction was prescriptive as to area, not proscriptive. It directed the Council to exercise its functions to prepare a Draft LEP for prescribed areas. It did not forbid the Council from exercising its LEP functions under s 54 for the whole of its local government area. Indeed, the Council itself understood that to be so because it set about preparing a "principal" or "comprehensive" LEP for its whole local government area.

65 The Council alternatively submits that the Minister failed to take into consideration the s 55 Direction which he was bound to take into account. In my opinion, the submission is untenable. Assuming that the s 55 Direction was a mandatory relevant consideration, it was clearly taken into account by the Minister. For example, it was specifically referred to in the Minister's show cause letter of 12 October 2007 and in the Minister's reasons attached to his letter to the Council's solicitors of 1 February 2008: see [18] and [35] above.

GROUND 4 67 Ground 4 is that the Minister denied the Council procedural fairness in appointing the Panel and that this amounts to jurisdictional error.

68 The Minister submits that (a) the nature and extent of the requirement to accord procedural fairness varies as a function of the circumstances in which the decision is made; (b) the scheme of the EPA Act does not prescribe that procedural fairness must be given in the making of a decision pursuant to Part 6 Division 1AA (which includes s 118); (c) in other aspects of decisions under the EPA Act, procedural fairness is specifically prescribed; (d) therefore as a matter of the proper construction of the EPA Act it cannot be said that in the appointment of a panel procedural fairness is required to be accorded; and (e) instead, the matters that the Minister is required to take into account are set out in s 118.

69 There are two questions. The first is whether the exercise of the Minister's power is conditioned upon observing the principles of procedural fairness; the second is what those principles require in the circumstances: Re Minister for Immigration and Multicultural Affairs; Ex parte Miah (2001) 206 CLR 57 at 68-69 [29]. By construing the EPA Act, one ascertains the answer to the first question and, in addition, whether there are any special procedural steps which, being prescribed by the statute, extend or restrict what the principles of procedural fairness would otherwise require: ibid at 69 [30], 75 [53].

70 I do not accept the Minister's submission that procedural fairness is not required in the appointment of a panel under s 118. The Council's interests were affected by the 2008 Order in a manner substantially different from anyone else. Where a statute confers power upon a public official to destroy, defeat or prejudice a person's rights, interests or legitimate expectations, procedural fairness is implied unless it is excluded by plain words of necessary intendment: Kioa v West (1985) 159 CLR 550, 584; Annetts v McCann (1990) 170 CLR 596, 598; Ainsworth v Criminal Justice Commission (1992) 175 CLR 564, 576; Miah (above) at 83 [89], 93 [126], 113 [183]. There are no such plain words in the present case. A legislative intention to exclude the rules of procedural fairness is not to be inferred from indirect or uncertain inferences, equivocal considerations or the presence in a statute of rights which are commensurate with some of the rules of procedural fairness: Miah at 93 [126]. A statutory prescription of procedural fairness in other aspects of decisions under the EPA Act is too weak a reason to conclude that Parliament intended to exclude the principles of procedural fairness under s 118. In my opinion, the terms of the EPA Act display no legislative intention to exclude the rules of procedural fairness when the Minister appoints a panel under s 118.

71 Procedural fairness requires a decision-maker to inform a party whose interests are likely to be affected by the exercise of power of the case against them and to afford that person a reasonable opportunity to comment and make submissions: Miah at 86 [99]. This requires that the decision-maker disclose the "critical issue or factor on which the decision is likely to turn" and ensure that the "gravamen or substance of the issue or factor" is brought to the party's attention: Pilbara Aboriginal Land Council Aboriginal Corporation v Minister for Aboriginal and Torres Strait Islander Affairs (2000) 103 FCR 539 at 557 [70] per Merkel J. A party should not be "left in the dark" as to what are the critical issues: Mahon v Air New Zealand Ltd [1984] 1 AC 808, 821; Re Minister for Immigration and Multicultural Affairs; Ex parte "A" (2001) 185 ALR 489 at 498; Minister for Immigration and Multicultural Affairs v Bhardwaj (2002) 209 CLR 597 at [40]. In Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Palme (2003) 216 CLR 212 at 219 Gleeson CJ, Gummow and Heyden JJ quoted the Full Court of the Federal Court in Commissioner for Australian Capital Territory Revenue v Alphaone Pty Ltd (1994) 49 FCR 576 at 591-592 as follows: Where the exercise of a statutory power attracts the requirement for procedural fairness, a person likely to be affected by the decision is entitled to put information and submissions to the decision-maker in support of an outcome that supports his or her interests. That entitlement extends to the right to rebut or qualify by further information, and comment by way of submission, upon adverse material from other sources which is put before the decision-maker. It also extends to require the decision-maker to identify to the person affected any issue critical to the decision which is not apparent from its nature or the terms of the statute under which it is made. The decision-maker is required to advise of any adverse conclusion which has been arrived at which would not obviously be open on the known material. Subject to these qualifications however, a decision-maker is not obliged to expose his or her mental processes or provisional views to comment before making the decision in question.

72 In SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs (2006) 228 CLR 152 at 162 [32] the High Court quoted from a different part of the judgment in Alphaone at 590-591: It is a fundamental principle that where the rules of procedural fairness apply to a decision-making process, the party liable to be directly affected by the decision is to be given the opportunity of being heard. That would ordinarily require the party affected to be given the opportunity of ascertaining the relevant issues and to be informed of the nature and content of adverse material.

73 In Balmain Association Inc v Planning Administrator for the Leichhardt Council (1991) 25 NSWLR 615 the Court of Appeal held that procedural fairness was implied in relation to decision-making under s 118. In that case, the Minister's reasons showed that matters other than non-compliance with a s 55 direction had influenced the Minister's decision and the Minister had not put the Council on notice that he was considering these other matters. The Council was denied procedural fairness and the Minister's decision was therefore held to be invalid. The Court held at 638: Disciplinary action against an elected local council which deprives it of its planning authority over a substantial area of its municipality is a step which certainly attracts the duty of procedural fairness and a right in the Council to be heard before such disciplinary action is taken: see Durayappah v Fernando .

The provision of an opportunity to be heard will usually result in an exercise of statutory powers which is better informed. There would be no need for the Minister, unless he saw fit, to give a formal notice, or to conduct or arrange a formal hearing… However, there was an obligation in the circumstances to afford the Council an opportunity to be heard on all the matters which concerned the Minister before he exercised this power.

74 The Council submits that the principles of procedural fairness were not satisfied in two respects.

(i) Failure to disclose 2008 Order Map 3 - Pymble 75 The first respect is said to be that the Minister did not disclose to the Council before making the 2008 Order that he proposed to change the Pymble town centre map from that which was attached to the draft order sent to the Council's solicitors on 25 January 2008. The circumstances of the change to the Pymble map have been analysed at [47] - [51] above. It was changed following the process of notification to the Council and submissions made by the Council through its solicitors. The change resulted from a process of procedural fairness to the Council. The Council conceded in its submissions in reply that if the new Pymble map had reflected a reduction in the rough circumference of the old Pymble map, it may have been to some degree responsive to the Council's submission. The Department's report to the Minister of 25 February 2008 noted that there was a reduction in the area of the Pymble map: see [53] above. A comparison of the two Pymble maps bears out that there was a significant reduction overall in the new Pymble map albeit it took in new area to a relatively minor degree. In any event, the Minister was not obliged to disclose to the Council the mental processes or provisional views he or the Department may have formed concerning the Pymble map following that process. In the circumstances, in my view, procedural fairness did not require the Council to keep batting proposed drafts of the Pymble map back over the net until everything that the Council might wish to submit about every draft was exhausted. In particular, in my opinion, it did not require the Minister to resubmit the new Pymble map for consideration by the Council.

(ii) Failure to disclose basis for enlarging areas 76 The Council also submits that the Minister failed to provide procedural fairness because he did not disclose to the Council the basis for enlarging the areas in the draft LEP maps. In my view, this is contrary to the fact. A basis was disclosed in the Minister's planning reasons for his proposed areas provided to the Council in his letter of 1 February 2008. The reasons included the statement that the boundaries delineated on the map were based on Council's own original study areas "and provide a walkable catchment for the community in each of the centres to shops, offices, and public transport (in particular, the railway stations for all but one centre and the bus stops along the Pacific Highway and Mona Vale Road)".

Ground 5 78 Ground 5 is that in making the 2008 Order the Minister acted in excess of power in that there was no function under Part 3 of the EPA Act in relation to the Draft LEP areas capable of being vested in the panel.

79 When the 2008 Order was made, the Council had completed the various statutory steps in relation to making the Draft LEP (pursuant to the s 55 Direction) to the point of submitting the Draft LEP, submissions and other documents to the Director-General of the Department as required by s 68(4) of the EPA Act. The Council submits that the Council's LEP function was therefore exhausted, apart from the possibility of amendment for minor error under s 73A or amendment by agreement between the Minister and the Council (or in certain other circumstances) as permitted by s 68(9). The Council submits that it was then up to the Director-General and the Minister to discharge their respective reporting and decision-making functions under ss 69 and 70 in respect of the Draft LEP. The Council submits that the Minister had no power to vest in the Council a function that was exhausted. 80 The Council relies on the principle that where a decision-maker's first exercise of power is spent and the decision-maker is therefore functus officio, a purported second exercise of the power by the decision-maker is ultra vires: Minister for Immigration and Ethnic Affairs v Kurtovic (1990) 21 FCR 193 at 211. In Minister for Immigration and Multicultural Affairs v Bhardwaj (2002) 209 CLR 597 at [43], [51] the High Court held that a decision involving a denial of procedural fairness, which amounts to a jurisdictional error, is in law no decision at all. The application of these principles in the context of Division 4 of Part 3 of the EPA Act has been considered in Richmond v Minister for Urban Affairs & Planning [2000] NSWLEC 23 by Sheahan J; Falkiner v Director-General of Planning NSW (2002) 125 LGERA 138 by Pain J; and Pongrass Group Operations Pty Ltd v Minister for Planning (2007) 156 LGERA 250 by Jagot J.

81 I am unable to accept the Council's submission. The question is one of statutory interpretation. The EPA Act does not expressly provide that a Council's LEP power is spent once it takes the statutory step for which s 68(4) provides. Where a statute does not expressly provide that a power is spent when exercised, or that it may be exercised on more than one occasion, the construction of the power is assisted by the Interpretation Act 1987 (NSW), which relevantly provides:

5 Application of Act … (2) This Act applies to an Act or instrument except in so far as the contrary intention appears in this Act or in the Act or instrument. 48 Exercise of statutory functions (1) If an Act or instrument confers or imposes a function on any person or body, the function may be exercised (or, in the case of a duty, shall be performed) from time to time as occasion requires. 82 In the present case, there is, in my view, no such "contrary intention" and s 48(1) applies. In Falkiner at 151 [61] Pain J held that the scheme of Part 3 of the EPA Act allows for steps to be carried out on more than one occasion provided the sequence overall is in accordance with Part 3. I see no statutory confinement of the power of the Council to repeatedly exercise its functions under Part 3 in relation to preparation of a local environmental plan.

ground 6 84 Ground 6 is that the Minister acted in excess of power under s 118 of the EPA Act in relation to cl 4(4) of the 2008 Order.

85 Clause 4(4) of the 2008 Order provides that the Panel may exercise functions under Part 3 of the EPA Act in relation to the making of environmental planning instruments by making a plan whose making commenced before the commencement of the 2008 Order. This includes the Draft LEP. The Council's argument is the same as for Ground 5 but the target is limited to cl 4(4). I reject Ground 6 for the same reasons as I rejected Ground 5. ESTOPPEL 86 By a Reply filed during the hearing, the Council pleads an estoppel as follows: In reply to the First Respondent's [Minister's] Amended Points of Defence the Applicant states that the First Respondent is estopped from denying that the jurisdiction of the Second Respondent [Panel], if any, in relation to the making of an LEP extends only to the area of land within the Applicant's Draft LEP.

Assurances given orally by the First Respondent to the Applicant on 22 November 2007, 17 and 20 December 2007 and 15 January 2008 in correspondence including the letter of the First Respondent dated 20 December 2007 and a letter of Mr Marcus Ray of 17 January 2008. 87 The alleged oral assurances were by the Minister to Mayor Ebbeck. The Minister's pleading denies the alleged oral assurances but he did not give evidence. The only evidence as to what was said was given by Mayor Ebbeck and has been set out at [21]-[30] above.

(a) The assurances of the Minister and the correspondence including his letter of 20 December and Mr Ray's letter of 17 January give rise to promissory estoppel and/or estoppel by conduct.

(b) The elements of promissory estoppel were catalogued by Brennan J in Waltons Stores (Interstate) Limited v Maher (1988) 164 CLR 387 as follows (at 428-429): In my opinion, to establish an equitable estoppel, it is necessary for a plaintiff to prove that (1) the plaintiff assumed that a particular legal relationship then existed between the plaintiff and the defendant or expected that a particular legal relationship would exist between them and, in the latter case, that the defendant would not be free to withdraw from the expected legal relationship; (2) the defendant has induced the plaintiff to adopt that assumption or expectation; (3) the plaintiff acts or abstains from acting in reliance on the assumption or expectation; (4) the defendant knew or intended him to do so; (5) the plaintiff's action or inaction will occasion detriment if the assumption or expectation is not fulfilled; and (6) the defendant has failed to act to avoid that detriment whether by fulfilling the assumption or expectation or otherwise. For the purposes of the second element, a defendant who has not actively induced the plaintiff to adopt an assumption or expectation will nevertheless be held to have done so if the assumption or expectation can be fulfilled only by a transfer of the defendant's property, a diminution of his rights or an increase in his obligations and he, knowing that the plaintiff's reliance on the assumption or expectation may cause detriment to the plaintiff if it is not fulfilled, fails to deny to the plaintiff the correctness of the assumption or expectation on which the plaintiff is conducting his affairs.

(c) It is not necessary to consider whether in this case estoppel is equitable or at common law as similar principles would apply. See Grundt v The Great Boulder Proprietary Gold Mines Ltd (1937) 59 CLR 641 per Dixon J at 674: …[T]he law should not permit an unjust departure by a party from an assumption of fact which he has caused another party to adopt or accept for the purpose of their legal relations. (d) In Thompson v Palmer (1933) 49 CLR 507 at 547 Dixon J said that a party may be required to abide by the assumption " because he directly made representations upon which the other party founded the assumption ".

(a) Estoppel is unavailable in this area of the law or, if it is, then it is inapplicable to a planning or policy decision, which the 2008 Order is: Minister for Immigration and Ethnic Affairs v Kurtovic (1990) 21 FCR 193; Attorney-General for the State of New South Wales v Quin (1990) 170 CLR 1; Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex Parte Lam (2003) 214 CLR 1. (b) If estoppel is unavailable, it is unnecessary to decide the question of the veracity of Mayor Ebbeck's evidence as to what the Minister said to him. Alternatively, if that issue has to be decided, the Mayor's evidence should be rejected because his account of his conversation with the Minister on 22 November 2007 cannot be reconciled with his file note of that event, which casts a cloud over the reliability of all his evidence concerning what the Minister said on various occasions.

90 In reply, the Council submits that the 2008 Order is not a planning or policy decision but an "operational" decision where estoppel is available: Minister for Immigration and Ethnic Affairs v Kurtovic (1990) 21 FCR 193.

91 In my opinion the estoppel case fails for two reasons. First, the estoppel pleaded is unavailable as a matter of law. Secondly, and alternatively, the estoppel case fails at the hurdle of establishing the elements of estoppel.

92 As to the first reason, it has been held in the High Court that no doctrine of administrative estoppel has emerged in Australia: Annetts v McCann (1990) 170 CLR 596 at 605 per Brennan J; Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam (2003) 214 CLR 1 at [69] per McHugh and Gummow JJ. In Attorney-General for the State of New South Wales v Quin (1990) 170 CLR 1 at 17-18 Mason CJ held (most citations omitted): …I am unable to perceive how a representation made or an impression created by the Executive can preclude the Crown or the Executive from adopting a new policy, or acting in accordance with such a policy, in relation to the appointment of magistrates, so long as the new policy is one that falls within the ambit of the relevant duty or discretion, as in this case the new policy unquestionably does. The Executive cannot by representation or promise disable itself from, or hinder itself in, performing a statutory duty or exercising a statutory discretion to be performed or exercised in the public interest, by binding itself not to perform the duty or exercise the discretion in a particular way in advance of the actual performance of the duty or exercise of the power… Accordingly, it has been said that a public authority...cannot be estopped from doing its public duty , to use the words of Lord Denning MR in Lever Finance v Westminster London Borough Council … As Gummow J observed in Minister for Immigration v Kurtovic , the principle has been explained on the footing that: in a case of a discretion, there is a duty under the statute to exercise a free and unhindered discretion and an estoppel cannot be raised (any more than a contract might be relied upon) to prevent or hinder the exercise of the discretion; the point is that the legislature intends the discretion to be exercised on the basis of a proper understanding of what is required by the statute, and that the repository of the discretion is not to be held to a decision which mistakes or forecloses that understanding. …No doubt the principle gains some of its force from the circumstance that the discretion has a legislative foundation and it is not readily to be supposed that the legislature intended that a proper exercise of the discretion in the public interest was to be frustrated, hindered or circumvented by executive action. Nonetheless there is no reason why the same principle should not apply to common law powers and functions of the Crown or the Executive when they involve the making of decisions in the public interest.

What I have just said does not deny the availability of estoppel against the Executive, arising from conduct amounting to a representation, when holding the Executive to its representation does not significantly hinder the exercise of the relevant discretion in the public interest. And, as the public interest necessarily comprehends an element of justice to the individual, one cannot exclude the possibility that the courts might in some situations grant relief on the basis that a refusal to hold the Executive to a representation by means of estoppel will occasion greater harm to the public interest by causing grave injustice to the individual who acted on the representation than any detriment to that interest that will arise from holding the Executive to its representation and thus narrowing the exercise of the discretion: see the observations of Lord Denning MR in Laker Airways v Department of Trade [[1977] QB 643, at p. 707]; but see also the criticism of this approach by Gummow J in Kurtovic . 93 In Minister for Immigration and Ethnic Affairs v Kurtovic (1990) 21 FCR 193 (FCA (FC)) Gummow J left open the possibility of estoppel applying against a public authority as regards its "operational" decisions which implement decisions made in exercise of the planning or policy level of decision-making (at 215). Assuming that this possibility has survived the dampening effect of the later High Court decisions, the Minister's alleged representation concerned alteration of the receptacle of power from the Council to a planning panel which, in my opinion, was a planning or policy decision, not an operational decision.

94 Secondly, in any event the estoppel case fails at the hurdle of establishing the elements of estoppel. I am concerned with the species of estoppel known as estoppel by representation, as to future conduct. In my view, the pleaded oral representations, whatever their content, were overtaken by or subsumed in the written representations in the Minister's letter to the Council of 20 December 2007 which were noted and confirmed in Mr Ray's letter to the Council of 17 January 2008: see [28] and [31] above. It is therefore unnecessary to resolve the question of the disputed terms of the conversations between the Minister and the Mayor. The pleading is skimpy because, among other things, it pleads the estoppel but not the terms of the alleged representation. I will proceed on the basis that the allegation is that the representation is in the same terms viz that the Panel's jurisdiction relating to the making of an LEP extends only to the area of land within the Draft LEP.

95 If the alleged representation was made, it was made in relation to the Panel constituted under the 2007 Order which was then on foot. The subsequent 2008 Order constituted another Panel. It is less than clear that the earlier representation can be said to be referable to the latter. However, I will proceed on the assumption that it can.

96 I disagree that the pleaded representation is to be found in the Minister's 20 December 2007 letter or in the reiteration in the 17 January 2008 letter. The 20 December 2007 letter in the last two paragraphs contained two different representations. First, a representation that the Minister had no present intention to make the LEP boundaries for the centres substantially bigger than the boundaries in the Council's Draft LEP. Secondly, if there were any significant inconsistencies between the latter boundaries and the final LEP boundaries recommended to the Minister by the Panel, the Minister was prepared to consult with the Council before making any final decision. Thus, the possibility of boundary changes was acknowledged notwithstanding the Minister's present intention. Those representations cannot ground the pleaded estoppel.

97 Further, it is not pleaded that the Council suffered any detriment in reliance on the alleged representation nor even that the Council relied on it. Let it be assumed, however, that the Minister made the alleged representation orally and that the Council relied on the Minister to take the course which it alleges that he orally represented he would take. If by stating an intention to take a certain course the Minister became bound to take that course regardless of any detriment suffered by the Council in reliance on the representation, then a mere expectation would become a substantive right. That is tantamount to invoking the doctrine of legitimate expectation, which is not pleaded and which on no view can give rise to substantive rights: Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam (2003) 214 CLR 1 at 9-10 [28], 27-28 [82]-[83], 48 [148]. Procedural fairness is satisfied by sufficient notice of a change in intention. Whatever may have been said orally by the Minister, his ultimately communicated intention is plain enough from the two letters even if it constitutes a changed intention.

ORDERS 99 The Further Amended Application is dismissed. Costs are reserved. 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.

(2006) 151 LGERA 229

(2002) 125 LGERA 138

(2007) 156 LGERA 250

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