Lahoud v Willoughby City Council

Court of Appeal (NSW)|2024-05-30|Before: Meagher JA, Leeming JA, Preston CJ, Moore J

Solicitors: McLachlan Thorpe Partners (Appellant) Lindsay Taylor Lawyers (First Respondent) Mills Oakley (Second Respondent) File Number(s): 2023/00426490 Publication restriction: NIL Decision under appeal Court or tribunal: Land and Environment Court Jurisdiction: Class 4 Citation: [2023] NSWLEC 117 Date of Decision: 2 November 2023 Before: Moore J File Number(s): 2021/00292505

[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

JUDGMENT

MEAGHER JA: I agree with Preston CJ of LEC.
LEEMING JA: I agree with Preston CJ of LEC.
PRESTON CJ of LEC: Mr Victor Lahoud brought judicial review proceedings in the Land and Environment Court challenging a development consent granted by Willoughby City Council (the Council) to Helm Pty Ltd (Helm) for the adaptive reuse of an existing commercial building including the erection of an additional level and the change of use to ground level business premises with 14 apartments above (the development) at 131 Sailors Bay Road, Northbridge (the land). Although the Council was the consent authority, pursuant to a Ministerial direction under s 4.8(3) and s 9.1 of the Environmental Planning and Assessment Act 1979 (NSW) (EPA Act), Willoughby Local Planning Panel (the Panel) determined Helm's development application on behalf of the Council. The decision being judicially reviewed was therefore the Panel's decision.
The proceedings as commenced joined the Council and Helm as respondents. The Council entered a submitting appearance. Helm was the contradictor, defending the Panel's decision to grant development consent. Mr Lahoud later sought to join the Panel as an additional respondent to the proceedings. The court below (Moore J) rejected that application for joinder: Lahoud v Willoughby City Council [2022] NSWLEC 125. This Court refused leave to appeal against this decision: Lahoud v Willoughby City Council [2022] NSWCA 214.
The judicial review proceedings were heard and determined by Moore J (the primary judge). The primary judge dismissed the proceedings and ordered Mr Lahoud to pay 80% of Helm's costs of the proceedings: Lahoud v Willoughby City Council [2023] NSWLEC 117.
Mr Lahoud appealed against the primary judge's decision and orders under s 58 of the Land and Environment Court Act 1979 (NSW) (Court Act). An appeal under s 58 of the Court Act is "a full one not limited to questions of law": Parramatta City Council v Hale (1982) 47 LGERA 319 at 338. On the appeal, this Court "has power to review findings of fact as well as determinations of applicable law": ACR Trading Pty Ltd v Fat-Sel Pty Ltd (1987) 11 NSWLR 67 at 69. The appeal is by way of rehearing and this Court can substitute its own decision on the facts and law as they stand at the relevant time: Fordham v Environment Protection Agency [2018] NSWCA 167 at [7].
The notice of appeal raised 12 grounds of appeal, identifying the alleged errors of fact and law of the primary judge. The grounds can be grouped in four categories concerning: 1. the Panel's failure to be satisfied under cl 4.6 of Willoughby Local Environmental Plan 2012 (WLEP) before granting development consent to the development that contravened the height standard under cl 4.3 of WLEP (grounds of appeal 1 to 5) (the height standard grounds); 2. the Panel's satisfaction that the development will have an active street frontage, contrary to cl 6.7(3) of WLEP (ground of appeal 6) (the active street frontage ground); 3. the Panel's acceptance of the development being for the permissible use of shop top housing (grounds of appeal 7 and 8) (the shop top housing grounds); and 4. the Panel's failure to consider contamination matters under cl 7 of State Environmental Planning Policy 55 - Remediation of Land (SEPP 55) (grounds of appeal 9 to 12) (the contamination grounds).
Helm raised five contentions in its notice of contention: 1. the primary judge should have found that the validity of the Panel's decision was not capable of being challenged because the proceedings were not commenced within time (contention 1); 2. the primary judge should have dismissed ground 1 (the height standard ground) on the basis that Mr Lahoud failed to establish that the Panel's decision was affected by the jurisdictional errors alleged (contention 2); 3. the primary judge should have dismissed ground 2 (the active street frontage ground) on the basis that Mr Lahoud failed to establish that the Panel's decision was affected by the jurisdictional errors alleged (contention 3); 4. the primary judge should have dismissed grounds 5 and 6 (the contamination grounds) on the basis that Mr Lahoud failed to establish that the decision was affected by the jurisdictional errors alleged (contention 4); and 5. the primary judge should have considered Helm's contention that even if the Panel's decision was affected by jurisdictional error, the Court could make an order suspending the operation of the development consent and specifying the terms that could validate the consent pursuant to s 25B of the Court Act (contention 5).
I will address each of the four categories of grounds of appeal, together with the contentions related to each category, before I address the contention that the judicial review proceedings have been brought out of time.
I have determined that none of the grounds of challenge to the Panel's decision has been established. The grounds of appeal against the primary judge's findings that certain grounds had not been established are rejected and the contentions against the primary judge's findings that other grounds had been established are upheld. These conclusions make it unnecessary to address the grounds of appeal and the contention concerning the primary judge's various exercises of discretion to decline to grant relief.

The height standard grounds

The development included erecting an additional level (Level 4) on the existing building to provide two 3-bedroom apartments. The additional level increased the height of the building to 18.08m. Under cl 4.3 of WLEP, the maximum height of a building on the land is 14m. The development application was accompanied by a written request under cl 4.6 of WLEP that sought to justify the contravention of the height standard.
On 29 June 2021, the Panel considered the written request, as required by cl 4.6(3), and stated that it was satisfied of the matters in cl 4.6(4). The Panel stated: "The Panel is satisfied that: a) the applicant's written request adequately addresses the matters required to be addressed under cl 4.6(3) of the LEP; a) the development is in the public interest because it is consistent with the objectives of cl. 4.3 (Height of building) of the LEP and the objectives for development in the B2 Local Centre zone; and b) the concurrence of the Secretary has been assumed."
The Panel gave reasons for this satisfaction as being "[t]he reasons outlined in the Council assessment report" and, in relation to cl 4.6 of WLEP, the following reason: "1. Supports, subject to conditions, the Clause 4.6 exception contained in Attachment 4 as it is considered unreasonable and unnecessary to comply with the development standard of Clause 4.3 Willoughby Local Environmental Plan 2012 (Height of buildings) as the height of the proposed development exceeds the development standard. a) The proposed building has architectural merit compared with existing, providing for a shop-top development that complies with the maximum floor space ratio control, occupies a similar footprint to existing and continues to read as of a comparable scale with the immediate adjoining buildings to the east. b) Subject to conditions, the proposal is consistent with the objectives of the height standards and consistent with the objectives of the B2 Local Centre zoning. c) Subject to conditions, the proposal is of a similar scale and bulk able to be built with DA-2014/241; part of the height breach is due to the lift overrun, similar to existing lift overrun height."
The reference to the proposal being of "a comparable scale with the immediate adjoining buildings to the east" and being of "a similar scale and bulk" reflected the fact that the neighbouring building to the east, which was owned in part by companies associated with Mr Lahoud, and subject to the same height control, was larger and taller than what was proposed by Helm.
The conditions to which the Panel referred included conditions 1 and 2. Condition 1 required that: "The development must be in accordance with the following consent plans electronically stamped by Council: [the plans are then itemised]… the application form and any other supporting documentation submitted as part of the application, except for: (a) … (b) otherwise provided by the conditions of this consent."
One of the conditions of consent to which condition 1(b) referred was condition 2. Condition 2 amended the development shown in the architectural plans identified in condition 1. Condition 2 provided: "Prior to the issue of the Construction Certificate, the proposal is to be amended in the following manner: (a) In order to maintain views obtained from adjoining Apartment 31 at 135-145 Sailors Bay Road, Apartment 402 at Level 4 shall be re-designed to a smaller size in order to ensure that, with exception of the balcony, built spaces do not extents [sic] further than 22.75m from rear boundary of the site. About 51m2 of gross floor area are expected to be deleted from rear of Level 4. The size of Apartment 402 is expected to be a two-bedroom apartment with media, or a three-bedroom apartment or a two-bedroom apartment with a larger living/dining area. The balcony associated with Apartment 402 shall remain of same size and proportion (or smaller) and be relocated to adjoin the smaller, re-configured Apartment 402. This balcony shall not expand further towards east. The roof above this balcony shall extend over maximum half of the width of this balcony, with a similar shape to the one dotted on Level 4 plan. The Eastern side of this balcony shall have a fixed permanent privacy screen made from opaque glass or having vertical, solid, angled blades preventing line of site into adjoining apartments at 135-145 Sailors Bay Road. The privacy screen of the balcony shall be up to maximum 1.5m height, when measured from the finished level of the balcony. With the exception of the balcony described above, the remainder of the roof over the level 3 below (from northern edge of the building up to 22.75m from rear boundary of the site) shall be marked on plans to be Non Trafficable Roof. (b) In order to preserve the amenity of units located at 135-145 Sailors Bay Road, all windows located on the residential levels on the eastern elevation shall be constructed of translucent glazing and maintained as such throughout the lifetime of the building. All privacy screens located on the eastern elevation are to be fixed and built in such a manner to prevent lines of sight into adjoining apartments at 135-145 Sailors Bay Road. (c) Artificial lighting in the courtyards and lobby areas should be oriented in such a manner to ensure minimal nuisance for adjoining properties. Artificial lighting in these areas should automatically turn off when no person present in these common spaces. (d) No encroachments outside the subject site are permitted for Level 2, Level 3 and Level 4 and above, except for planter boxes and the concrete slab without planter boxes as shown on Level 4 plan. All encroachments are subject to entering a Deed, as per the Conditions of this consent., where these planter boxes are present on the plans. Details of these amendments are required to be approved by the Certifier and shown on the Construction Certificate plans. (Reason: Ensure compliance and Amenity)"
The effect of the Panel's decision was to grant consent to the development for which the consent was sought except for specified parts of Level 4 of the building, which were to be redesigned, relocated or deleted as specified in condition 2.
Mr Lahoud challenged this decision of the Panel, arguing that this manner of granting development consent subject to conditions led to the Panel not being satisfied of the matters it was required by cl 4.6(4) of the WLEP to be satisfied about. At the time of the Panel's decision, cl 4.6(4) provided: "(4) Development consent must not be granted for development that contravenes a development standard unless - (a) the consent authority is satisfied that - (i) the applicant's written request has adequately addressed the matters required to be demonstrated by subclause (3), and (ii) the proposed development will be in the public interest because it is consistent with the objectives of the particular standard and the objectives for development within the zone in which the development is proposed to be carried out, and (b) the concurrence of the Planning Secretary has been obtained."
Mr Lahoud argued that "the proposed development" referred to in cl 4.6(4)(a)(ii) is the development proposed in the development application. This is the whole development as proposed, including the northern parts of Level 4 of the building that the Panel required, by conditions of consent, to be redesigned, relocated or deleted. On this argument, cl 4.6(4) required the Panel to be satisfied as to the matters in cl 4.6(4) with respect to this whole development before it could grant development consent to that development.
Mr Lahoud argued that the Panel was not satisfied as required by cl 4.6(4)(a)(ii) in respect of this whole development as proposed. This was because, Mr Lahoud argued, the Panel concluded that it was only "subject to conditions" that the "proposal" would be consistent with the objectives of the height standard and consistent with the objectives of the B2 Local Centre zoning, including the conditions requiring parts of Level 4 to be scaled back.
Mr Lahoud argued that in so doing the Panel misdirected itself. If the Panel was not satisfied of the matters in cl 4.6(4) with respect to the whole development as proposed (the "proposed development"), the Panel was precluded from granting development consent to that development. The Panel could not overcome this requirement in cl 4.6(4)(a) by granting development consent to the proposed development with conditions to remove those parts of the development the Panel found to be unacceptable.
The primary judge accepted Mr Lahoud's argument that the Panel was not satisfied that the written request under cl 4.6 seeking to justify the contravention of the height standard adequately addressed the matters required to be demonstrated by cl 4.6(3). The primary judge stated in [149]: "It is clear from the earlier set out extract from the Planning Panel's reasons that they were not satisfied that the dispensation request satisfied each of the mandated elements. This is self‑evidently obvious from the fact that the Planning Panel did not uphold the dispensation request with respect to the entire development proposal advanced by the Company for consideration by the Planning Panel. The Planning Panel clearly concluded that the dispensation requested was not capable of being granted to its full extent because the Company's proposed development did not satisfy the mandated requirements of cl 4.6 with respect to that element of the northern end portion of the Company's DA as submitted to the Planning Panel for determination."
The primary judge did not, however, accept Mr Lahoud's argument that this conclusion precluded the Panel from granting development consent on conditions requiring the redesign, relocation or deletion of the unacceptable parts of the proposed development. The primary judge held that the Panel had power, under s 4.16(4)(b) of the EPA Act, to grant development consent for the development for which the consent was sought except for a specified part or aspect of that development. The primary judge found that, although the Panel did not expressly refer to s 4.16(4)(b) in its reasons for determination, the Panel's exercise of the power in s 4.16 to grant development consent subject to conditions can properly be understood to have invoked s 4.16(4)(b): at [151]-[154]. The primary judge therefore dismissed Ground 1 of the judicial review summons.
Mr Lahoud challenged these findings of the primary judge. Mr Lahoud firstly contended that, having found that the Panel had decided that it was not satisfied of the matters in cl 4.6(4), the primary judge should have found that the Panel had no power to grant development consent to the proposed development on conditions requiring removal of parts of that development (grounds 1 and 4). Mr Lahoud secondly contended that the primary judge erred in finding that the Panel did in fact invoke "the partial consent power" in s 4.16(4)(b) to grant development consent to the proposed development except for a specified part or aspect of that development, when in fact the Panel merely required the redesign of Level 4 and removal of a part of that level (grounds 3 and 5). Mr Lahoud thirdly contended that the primary judge denied him procedural fairness by finding that the Panel had exercised the power under s 4.16(4)(b) to grant a partial consent when no party had raised it as an issue, no notice of the proposed finding had been given to Mr Lahoud, and he was thus deprived of an opportunity to make submissions about it (ground 2).
Helm raised as a contention that the primary judge should have dismissed Ground 1 on the basis that Mr Lahoud had failed to establish that the Panel's decision was affected by the jurisdictional errors alleged by Mr Lahoud (contention 2). This contention can be dealt with together with the height standard grounds of appeal.
The height standard grounds of appeal are based on three assumptions of the statutory scheme that are incorrect. The first assumption is that s 4.16(4)(b) of the EPA Act itself is a source of power to grant development consent to a development application. It is not. There is only one power to grant development consent to a development application and that is in s 4.16(1) of the EPA Act. That subsection provides: "(1) A consent authority is to determine a development application by - (a) granting consent to the application, either unconditionally or subject to conditions, or (b) refusing consent to the application."
Other statutory provisions regulate how the power in s 4.16(1) is to be exercised.
Some provisions require the power to be exercised in a certain way. For example, s 4.16(2) requires the consent authority to exercise the power so as to refuse consent to the application where development for the subdivision of the land would result in a contravention of the EPA Act, an environmental planning instrument or the regulations.
Some provisions regulate how the power, if exercised so as to grant consent, is to be exercised. Section 4.17 is an example. If the development application is determined by the grant of development consent subject to conditions, any conditions must satisfy one or more of the requirements of s 4.17 for the imposition of conditions. Section 4.16(3) is another example, allowing the grant of a development consent subject to a condition that the consent is not to operate until the applicant satisfies the consent authority as to any matter specified in the condition (known as a deferred commencement condition).
Other provisions enable the power to be exercised in a certain way. Section 4.16(4) is an example. Section 4.16(4) enables development consent to be granted to the whole or part of the development for which the consent is sought. Subsection (4) provides: "(4) A development consent may be granted - (a) for the development for which the consent is sought, or (b) for that development, except for a specified part or aspect of that development, or (c) for a specified part or aspect of that development."
The second assumption is that s 4.16(4) only enables the grant of development consent for the development for which the consent is sought, except for a specified part or aspect of that development, or for a specified part of the development, by specifying that limitation in the description of the development in the development consent and not in the conditions to which the development consent is subject. That limitation is not to be found in the terms of s 4.16(4).
In terms, s 4.16(4) is silent as to how development consent may be granted to the whole or part of the development for which the consent is sought. In form, the development consent could specify the whole or part of the development to which consent is granted either in the description of the development in the beginning of the consent or in the conditions to which the grant of consent is subject later in the consent. In substance, each method of specifying the development to which consent is granted is the same.
Consider the grant of development consent in this case. The Notice of Determination of a Development Application for Development Consent DA-2020/238 specified that the Council "hereby CONSENTS to the abovementioned land [in the Description of Land] being used for the following purposes, subject to compliance with the Conditions set out in the attached Schedule". There then immediately followed the "Description of Proposal" as being "Adaptive conversion of the existing building into shop top housing, including additional level".
This chapeau of the development consent makes clear that the development to which development consent was granted was the "proposal" described in the "description of proposal" but subject to the conditions set out in the schedule. Condition 1 in the schedule provided that "[t]he development must be in accordance with" the stamped consent plans identified in the condition, except as "otherwise provided by the conditions of this consent." Condition 2 in the schedule required that "the proposal is to be amended in the following manner" and then specified the redesign, relocation and deletion of certain parts of Level 4 of the building required to be made.
The effect of conditions 1 and 2 was that development consent was only granted to the "proposal" (the development) as amended; no consent was granted to the erection and use of those parts of Level 4 in the proposed development that were required to be redesigned, relocated or deleted by the conditions. Development consent was only granted to the proposed development with those parts of Level 4 of the building redesigned, relocated or deleted. In this way, development consent was granted to the development for which the consent was sought except for the specified parts that were required to be redesigned, relocated or deleted, and after those parts had been redesigned, relocated or deleted.
The third assumption is that the consideration of the matters in cl 4.6(4) of the WLEP can only be in relation to "the proposed development" for which consent is sought and not the development to which consent is granted. That assumption is inconsistent with the terms of cl 4.6(4).
The proscription in the chapeau of cl 4.6(4) is on granting development consent for "development that contravenes a development standard." Development consent for that development cannot be granted unless the matters in cl 4.6(4)(a) and (b) are satisfied. Ascertaining whether this proscription is or is not complied with requires focusing on the development for which development consent is granted. If development consent is granted for the development for which consent is sought except for a specified part or aspect of that development, then it is that development except for that specified part or aspect, in respect of which the consent authority must be satisfied of the matters in cl 4.6(4). In particular, the consent authority must be satisfied that that development except for the specified part or aspect "will be in the public interest because it is consistent with the objectives of the particular standard and the objectives for development within the zone in which the development is proposed to be carried out" (cl 4.6(4)(a)(ii)). The consent authority does not need to be satisfied that the development with that specified part or aspect will meet those matters in cl 4.6(4)(a) because development consent will not be granted to that development with that specified part or aspect.
Once the incorrectness of those three assumptions is appreciated, each of the height standard grounds of appeal can be seen to be unfounded. As to grounds 1 and 4, the Panel did not breach cl 4.6(4) by granting development consent to the development for which consent was sought except for the specified parts of Level 4 of the building which were required by the conditions to be redesigned, relocated or deleted. That development, except for those specified parts which were required to be redesigned, relocated or deleted, did contravene the height standard, but the Panel was satisfied that Helm's written request had adequately addressed the matters required to be demonstrated by cl 4.6(3) (cl 4.6 (4)(a)(i)) and that the development, except for those specified parts which were required to be redesigned, relocated or deleted, will be in the public interest because it was consistent with the objectives of the height standard and the objectives for development within the zone in which the development was proposed to be carried out (cl 4.6(4)(a)(ii)). Even if the Panel was not satisfied of the matters in cl 4.6(4) with respect to the development for which the consent was sought, without those specified parts being redesigned, relocated or deleted, that was not the development for which development consent was granted. Hence, there was no contravention of cl 4.6(4).
As to grounds 3 and 5, on a proper construction of the development consent, the development to which the Panel granted development consent was the development for which the consent was sought, except for the parts of Level 4 of the building which were required by the conditions of consent to be redesigned, relocated or deleted, and after that redesign, relocation or deletion of those parts of Level 4 had been effected. That is to say, the development as amended was the development for which development consent was granted. The grant of development consent to this amended development was within the power under s 4.16(1) as enabled by s 4.16(4) of the EPA Act.
As to ground 2, although the primary judge referred to s 4.16(4)(b) as being the statutory power to approve part of the proposed development, that was incorrect. The power to determine the development application by granting consent subject to conditions was in s 4.16(1). Section 4.16(4)(b) enabled that power in s 4.16(1) to be exercised so as to grant development consent for the development for which the consent is sought except for a specified part or aspect of the development. Once this is understood, the primary judge's finding that the Panel had exercised the power in s 4.16(1) in the way permitted by s 4.16(4)(b) did not raise a new issue in respect of which notice needed to be given to the parties and an opportunity afforded for them to be heard. There was no denial of procedural fairness in the primary judge identifying how the power in s 4.16(1) was exercised by the Panel.
For these reasons, the height standard grounds are rejected. This conclusion also addresses contention 2 of Helm's notice of contention, which should be upheld.

The active street frontage ground

The building Helm proposed to redevelop is on land bounded by Sailors Bay Road to the south, Harden Avenue to the east and Timms Lane to the north. Both Sailors Bay Road and Harden Avenue are identified on the Active Street Frontages Map under cl 6.7(3) of WLEP as streets requiring an active street frontage. Clause 6.7(3) of WLEP provides that: "Development consent must not be granted to the erection of a building, or a change of use of a building, on land to which this clause applies unless the consent authority is satisfied that the building will have an active street frontage after its erection or change of use."
The term "active street frontage" is defined in cl 6.7(5): "In this clause, a building has an active street frontage if all premises on the ground floor of the building facing the street are used for the purposes of business premises or retail premises."
Clause 6.7(4) provides that an active street frontage is not required for any part of a building that is used for specified uses, including "vehicular access."
The proposed development involved changing the use of two premises on the ground floor of the building to business premises. These two premises faced Sailors Bay Road and Harden Avenue respectively. The business premises facing Harden Avenue extended for about 40% of the building's length along Harden Avenue. The balance of the building's frontage to Harden Avenue was the existing carpark. The carpark had no access, either vehicular or pedestrian, to Harden Avenue. The development proposed to erect a decorative screen along the exterior wall of the carpark but not to provide any access from Harden Avenue. Instead, the existing access from Timms Land would be maintained, with some works to upgrade the driveways providing vehicular access. The development did not propose any change of use of the carpark. However, the persons entitled to use the carpark would change, from the occupants of the former office premises in the building to the occupants of the new ground floor business premises and the new apartments to which the former offices would be converted.
The Panel gave as one of its reasons for decision: "2. Despite being an adaptive re-use of the existing building, when compared to existing, the proposal presents a greatly improved outcome within the context of Sailors Bay Road and Harden Avenue, integrating active frontages and landscaping to two streets."
This reason supplemented "[t]he reasons outlined in the Council assessment report" dated 22 June 2021 which the Panel adopted. That report stated: "The proposal activates Sailors Bay Road and Harden Avenue frontages, contributing to the desired mixture of residential and retail in a Local Centre and to future development as envisioned by Willoughby Local Centres Strategy to 2036."
Attachment 2 to the Council assessment report referred in the "Development Statistics" table to cl 6.7 of WLEP, noting that an active street frontage is "[r]equired on both Sailors Bay Road and on Harden Avenue"; is proposed "on Sailors Bay Road, partial on Harden Avenue (~40% of the length)"; and is "Acceptable". This analysis was expanded in the comments: "b) Active Street Frontage The proposal has the constraints that arise from retaining most of the existing structure of the building. The amended plans increased the size of the business premise at ground floor. The commercial space is now addressing both streets. Taking into account the amended plans, the legal advice provided by Mills Oakley and the comments provided by Council's Design Specialist, Council is satisfied that, after the proposed change of use, the building will have sufficient active street frontage to meet Clause 6.7 of WLEP 2012 on both Sailors Bay Road and Harden Avenue."
In the sections summarising referrals to relevant officers of the Council, the Design Specialist was recorded as having "no objection" and making the following comments: "The corner location while not visually prominent will impact the quality and character of Sailors Bay Road and Harden Avenue. Aligning the building frontage to the property boundary, consistent with the future provisions of the Willoughby Local Centres Strategy to 2036. Site access to a ground floor undercroft carpark will be via Timms Lane. Any proposed streetscape works shall be consistent with the Council Adopted Northbridge Public Domain Plan -2021. The development will retain and expand ground floor commercial/retail use to potentially provide active frontage to Sailors Bay Road and Harden Avenue. The development does present a greatly improved built form, integrating active access/frontage to two street frontages. Pedestrian amenity is greatly improved through the integration of an awning to Sailors Bay Road. The DA, comprising the building alignment to Sailors Bay Road is consistent with the directions in the Willoughby Local Centres Strategy to 2036."
Attachment 3, the table summarising public submissions on the development application, addressed the issue of compliance with cl 6.7: Issues raised Comments The proposal is an adaptive reuse of the building into a shop top development. The partial car parking retention arises from the desire to retain significant parts of the existing building. As the existing structure is being retained, the columns, slabs and footings within the basement must also be retained and cannot be undermined by digging a new level below in order to provide further basement car parking. It appears there is no reasonable alternative to the retention of the current parking arrangements on the site. Adaptive re-use of a building is regarded as a sustainable way, as the applicant notes: The development is prohibited given its failure to satisfy Clause 6.7 - Active Street Frontages of WLEP 2012/ The retention of existing structures and the adaptive reuse of buildings is one of the most sustainable forms of creating new buildings. Building and construction accounts for nearly 40 per cent of energy-related carbon dioxide emissions. This includes 28 per cent from heating, cooling and powering a structure, and 11 per cent from materials and construction. The applicant is committed to upgrading the existing building for extended use as a more carbon-efficient alternative to demolition'. the proposal is non-compliant with Clause 6.7 of the WLEP 2012 While every effort was made to accommodate as much commercial space at ground floor as possible (as depicted in the amended plans), the configuration must accommodate both car parking and commercial at ground floor. Notwithstanding the above, Mills Oakley provided legal advice on behalf of the applicant that the proposal is already compliant with Clause 6.7 Active Street Frontage. Council's Design specialist is satisfied that the amended scheme sufficiently complies with the intent of Clause 6.7 - Active Street Frontages of WLEP 2012. More detailed assessment is contained in Attachment 7. Use at ground level, should not be for car parking The proposal is an adaptive reuse of an existing building. As the existing structure is being retained, the car parking level is also partially retained. Notwithstanding the retention of some of the current parking arrangements, sufficient commercial space is created at ground floor in order to activate entirely the street frontage at Sailors Bay Road and partially, but satisfactory, the street frontage at Harden Avenue. Mills Oakley provided legal advice in regard to Clause 6.7 Active Street Frontage. All premises at ground floor are commercial premises and are of sufficient size to activate both Sailors Bay Road and Harden Avenue. Moreover, Council's Design Specialist is also supportive of the amended scheme. Taking into account the specifics of the site, the proposal is regarded as satisfactory.

In Attachment 7, to which reference was made, the report addressed in more detail "compliance with clause 6.7 of WLEP 2012." The report noted that "[a] number of objections raised concern that the proposed development fails to satisfy Clause 6.7 of the WLEP 2012." The report noted that the development application "provides for 128m2 of commercial premise [sic] with access both from Sailors Bay Road and Harden Avenue." An extract of the ground floor plan showed the arrangement of the premises on the ground floor of the building. A larger business premises was proposed on the corner of Sailors Bay Road and Harden Avenue, with access off Sailors Bay Road, with a smaller business premises facing and with access off Harden Avenue. The plan showed the existing carpark continuing to have access off Timms Lane only. The report noted that: "This arrangement arises from the desire to retain most of the structure of the existing building and part of the existing parking arrangement. Vehicular access to the rear of the site, via ramps from Timms Lane, is also retained. The car park currently provides for 25 car spaces over two levels (ground floor and basement) plus two spaces external to the building, adjoining Timms Lane. The car parking spaces at ground level and the basement are proposed to be reduced to 18 spaces (10 spaces at basement level, plus 7 spaces at ground floor, plus 1 space external to the building on Timms Lane to be used both by the business tenancies and the removalist vans)."
The report summarised the legal advice of the applicant's solicitors on why this arrangement complied with cl 6.7: "Mills Oakley provided legal advice on 22 December 2020 on behalf of the applicant. Mills Oakley argues why the proposal chose to partially retain the existing car park in lieu of new business and/or retail premises at ground floor along Harden Avenue and why the proposal complies with Clause 6.7 of the WLEP 2012: ● the proposed ground floor will contain a business premise which faces both Sailors Bay Road and Harden Avenue and so the application complies with clause 6.7 of the WLEP 2012; ● there is presently no commercial activity on Harden Avenue, and it is almost entirely a residential street with the exception of the Sailors Bay Road intersection; ● the proposal will provide more active frontage than the existing development; ● the provision of a further level of basement car parking is not feasible; ● the car park is not a ground floor premises facing the street; ● 'vehicular access' is an exception to the requirements for active street frontages under clause 6.7(4) of the WLEP 2012; and ● Council accepted that the existing car parking arrangements needed to be retained including in light of the above considerations in its assessment of the previous DA. Mills Oakley concludes that all premises on the ground floor of the building facing the street are to be used for the purposes of business premises or retail premises, and therefore the proposal complies with Clause 6.7 of the WLEP 2012."
Attachment 7 of the report quoted the definition of "active street frontage" in cl 6.7(5) and analysed whether the carpark was required to have an active street frontage to Harden Avenue: "The use of 'premises' in the context of the Standard Instrument refers to a space/ room/s with associated facilities that has a certain specific use, generally mentioned forward to the word 'premises', as is the case of the 'commercial premises': commercial premises means any of the following - (a) Business premises. (b) Office premises, (c) Retail premises. Other words in the WLEP 2012 Dictionary are defined to make reference to 'buildings' or 'places' instead of 'premises', as for example community facility means a building or place… In this case, 'building' refers to the entire structure, car parking included. Consequently, car parking is not regarded as a premises. Neither is in the case of 'a change of use of a premises' that does not automatically imply change of use of associated car parking. Furthermore, in this specific case, ground floor car parking is accessed from Timms Lane and so, it is not facing Sailors Bay Road or Harden Avenue."
The report then analysed the balance of the premises on the ground floor to assess whether they have an active street frontage: "Notwithstanding the retention of some of the current parking arrangements, satisfactory amount of business premises is created at ground floor in order to activate both street frontages (Sailors Bay Road and Harden Avenue) and all premises on the ground floor of the building facing the street are used for the purposes of business premises. Furthermore, Council's Design Specialist advised he is satisfied that the amended scheme complies with the intent of Clause 6.7 - Active Street Frontages of WLEP 2012, "to promote uses that attract pedestrian traffic along certain ground floor street frontages": "The development does present a greatly improved built form, integrating active access/ frontage to two street frontages". Clause 6.7(3) of the WLEP 2012 states: Development consent must not be granted to the erection of a building, or a change of use of a building, on land to which this clause applies unless the consent authority is satisfied that the building will have an active street frontage after its erection or change of use. Taking the above into account, Council is satisfied that the building will have sufficient active street frontage after the change of use to meet Clause 6.7 of WLEP 2012 on both Sailors Bay Road and Harden Avenue."
The primary judge concluded, without any explanation, that Mr Lahoud's ground 2, that the Panel's decision was in breach of cl 6.7, was established: "This ground can be disposed of comparatively briefly. First, the terms of cl 6.7 of the LEP are ones which had put a requirement for satisfaction on the Planning Panel that what was mandated - the activation of the entire street frontage along Harden Avenue for the entirety of its length adjacent to the site - was achieved. Despite the valiant endeavours of Mr Galasso to explain why it should be concluded that it had been achieved, there is no proper basis in fact on any rational construction of the wording of the clause that could have led the Planning Panel to have concluded that it was satisfied": at [186].
The reason was that: "There was no evidence before the Planning Panel that would have permitted it, in the sense addressed by the Court of Appeal at [75] of El Khouri that, in its consideration of cl 6.7 of the LEP, there was a proper evidentiary basis upon which it could conclude that the provision had been satisfied.": at [189].
Nevertheless, the primary judge, in the exercise of his discretion, declined to "order any intervention with" the development consent: "As a matter of the exercise of my discretion pursuant to s 46(1) [sic, s 9.46(1)] of the EPA Act, I, too, am satisfied that, on the merits of those aspects of the proposal relevant to the issue of activation of the Harden Avenue street frontage, there will be sufficient activation on that frontage when compared to what was the pre-existing position, that it is not appropriate to order any intervention the Company's development consent on the basis of non-compliance with cl 6.7 of the LEP.": at [197].
Both Mr Lahoud and Helm challenged the primary judge's findings, Mr Lahoud the finding not to order any intervention in the development consent (ground 6) and Helm the finding that the Panel's decision contravened cl 6.7 (contention 3 in its notice of contention).
I will begin with Helm's contention, as if it is upheld it is unnecessary to decide Mr Lahoud's ground of appeal.
The question of whether the building as proposed to be redeveloped will be a building that has an active street frontage within the statutory description in cl 6.7(5) was not a jurisdictional fact: as to what is a jurisdictional fact, see El Khouri v Gemaveld Pty Ltd (2023) 256 LGERA 24; [2023] NSWCA 78 at [33]. Rather, the question was one for the Panel to decide. That is made plain by the terms of cl 6.7(3): the consent authority is to determine whether it "is satisfied that the building will have an active street frontage" after the erection or change of use of the building. This involves the consent authority deciding whether the facts found by it fall within or without the statutory description of "active street frontage" in cl 6.7(5). The consent authority's decision of satisfaction or non-satisfaction as to whether the building will have an active street frontage is reviewable, not as a jurisdictional fact, but only for jurisdictional error. As the High Court recently observed in LPDT v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs & Anor [2024] HCA 12 at [3]: "Jurisdictional error on the part of a statutory decision-maker in making a decision can include: misunderstanding the applicable law; asking the wrong question; exceeding the bounds of reasonableness; identifying a wrong issue; ignoring relevant material; relying on irrelevant material; in some cases, making an erroneous finding or reaching a mistaken conclusion; or failing to observe some applicable requirement of procedural fairness."
Mr Lahoud's ground 2 of the judicial review summons sought to challenge the Panel's decision that it was satisfied that the building will have an active street frontage for misunderstanding the statutory description of active street frontage in cl 6.7(5), asking the wrong question, identifying a wrong issue and exceeding the bounds of reasonableness: see the primary judge's extract of ground 2 in [156] of the judgment.
The primary judge nevertheless appears to have upheld ground 2 for the reason that "there is no proper basis in fact on any rational construction of the wording of the clause that could have led the Planning Panel to have concluded that it was satisfied." (at [186]). The primary judge did not explain what he believed to be "any rational construction of the wording of the clause" or whether he believed the Panel had construed the clause differently to whatever this construction of the wording of the clause might be. The primary judge also did not explain why he found there to be "no proper basis in fact" in the material before the Panel for it to conclude that it was satisfied that the building will have an active street frontage.
The Panel's decision could not be reviewed for merely being wrong in fact. If the material before the Panel reasonably admitted of different conclusions as to whether the building as proposed to be redeveloped fell within or without the statutory description of "active street frontage" in cl 6.7(5), a decision either way by the Panel could not be disturbed for merely being wrong in fact: Australian Gas Light Co v Valuer-General (1940) 40 SR (NSW) 126 at 138; NSW Associated Blue-Metal Quarries Ltd v Federal Commissioner of Taxation (1956) 94 CLR 509 at 512; Hope v Bathurst City Council (1980) 144 CLR 1 at 8.
In this case, the Active Street Frontages Map, referred to in cl 6.7(2), identified Sailors Bay Road and Harden Avenue, but not Timms Lane, as being streets requiring an active street frontage. As a consequence, for the purposes of the statutory description of "active street frontage" in cl 6.7(5), the relevant inquiry concerned the premises on the ground floor of the building "facing" one or other or both of Sailors Bay Road or Harden Avenue. All premises on the ground floor of the building facing Sailors Bay Road or Harden Avenue were to be used for the purposes of business premises or retail premises.
The Panel found, on the material before it, that of the three premises on the ground floor of the building, two premises faced Sailors Bay Road or Harden Avenue, being the two proposed business premises, and one faced Timms Lane, being the existing carpark. The Panel found that as the existing carpark only had access off Timms Lane, and no access off Harden Avenue, the carpark was not "premises on the ground floor of the building facing" a street that required an active street frontage, being either Sailors Bay Road or Harden Avenue.
As a consequence, the Panel found that the proposed building fell within the statutory description in cl 6.7(5) of having an "active street frontage" because all of the premises on the ground floor of the building facing Sailors Bay Road or Harden Avenue, being the two business premises, will be used for the purposes of business premises. As the Panel was satisfied that the building will have an active street frontage after the change of use of the ground floor of the building, the Panel was not precluded by cl 6.7(3) from granting consent to the change of use of the building.
The Panel's finding that the facts concerning the business premises' access to, but the carpark's lack of access to, Sailors Bay Road or Harden Avenue, caused the building to fall within the statutory description in cl 6.7(5) of being a building that has an active street frontage was reasonably open to the Panel. The facts inferred by the Panel concerning access to the street were capable of supporting the Panel's finding that the building has an active street frontage and there was evidence capable of supporting the Panel's inferences of fact.
The Panel's finding that the building has an active street frontage did not involve any jurisdictional error. The Panel did not misconstrue cl 6.7(5), ask itself the wrong question or identify a wrong issue. In particular, the Panel did not misunderstand the ordinary meaning of the words "facing the street" in s 6.7(5). The "street" refers to a street identified in the Active Street Frontages Map, in this case Sailors Bay Road or Harden Avenue, not Timms Lane. "Facing" the street, in the context of a building having an active street frontage, refers to premises having access from the street, whether pedestrian or vehicular. Premises that cannot be accessed from a street needing to have an active street frontage do not face that street.
In these circumstances, the primary judge erred in finding that "there is no proper basis in fact on any rational construction of the wording of the clause that could have led the Planning Panel to have concluded that it was satisfied" (at [186]). There was a proper basis in fact on the material before the Panel, and on a proper construction of the statutory description of "active street frontage" in cl 6.7(5), for the Panel to conclude that the building will have an active street frontage. As this is sufficient to uphold the Panel's conclusion, it is not necessary to express any view about the correctness of other aspects of the Mills Oakley advice considered by the Panel.
Helm's contention 3 should therefore be upheld and the primary judge's finding that Mr Lahoud's ground 2 of the judicial review summons had been established set aside. This makes it unnecessary to decide Mr Lahoud's ground of appeal 6, that the primary judge's exercise of discretion miscarried in declining to grant declaratory relief to remedy the breach of cl 6.7. If the Panel's decision was not in breach of cl 6.7, there is no occasion to consider whether and what relief should be granted to remedy a breach.

The shop top housing grounds

The proposed development was approved by the Panel as being for the permissible development of "shop top housing". Development for "shop top housing" is permissible with consent in the B2 Local Centre zone under WLEP, but residential accommodation is prohibited. "Shop top housing" is defined in the Dictionary to WLEP to mean "one or more dwellings located above ground floor retail premises or business premises." A "dwelling" is defined in the Dictionary to mean "a room or suite of rooms occupied or used or so constructed or adapted as to be capable of being occupied or used as a separate domicile."
The Panel determined to grant development consent to the "[a]daptive conversion of the existing building into shop top housing, including additional level" (Notice of Determination of a Development Application). The Panel's reasons were stated in the Determination and Statement of Reasons to include the "reasons outlined in the Council assessment report". The report accepted that the proposed development was for shop top housing.
Ground 3 of the judicial review summons challenged the Panel's decision that the development was for shop top housing. Mr Lahoud's argument was that the carpark on the ground floor of the building should be characterised as being for residential accommodation, as all of the carparking spaces, except for a limited number allocated for use by the business premises on the ground floor, will be allocated for use by the occupants of the new apartments in the building. In this circumstance, all of the dwellings are not "above" ground floor retail premises or business premises. This argument did not depend on challenging the correctness of the primary judge's earlier decision, when the Senior Commissioner of the Court, in Arco Iris Trading Pty Ltd v North Sydney Council [2015] NSWLEC 1113 (Arco Iris Trading). In that case, the primary judge held that for the purposes of the definition of "shop top housing", the dwellings do not need to be vertically directly above the ground floor retail premises or business premises but can be laterally displaced provided the floor of the dwellings is higher than the ceiling of the ground floor retail premises or business premises.
Mr Lahoud's argument was encapsulated in his senior counsel's written submission, quoted by the primary judge in [207]: "56. … Only one of the car spaces is designated for use by the business premises. Adopting the Court's approach to the characterisation of car parking spaces in Arco Iris Trading Pty Ltd v North Sydney Council [2015] NSWLEC 1113 at [23]‑[30], the car spaces are properly characterised as for residential uses, not business or retail premises, and bearing in mind that the test is whether dwellings are above the ground floor, whether there is required to be a true vertical correlation or it is permissible for there to be a lateral displacement, the proposed dwellings are not "above" business or retail premises."
The primary judge found that ground 3 failed. His Honour did so, not by rejecting the above argument as actually made by Mr Lahoud, but rather by rejecting the argument he believed Mr Lahoud to have made, namely that his Honour's decision in Arco Iris Trading "was inappropriately expansive and that a direct vertical linear relationship was required for the purposes of establishing that residential accommodation could satisfy the terms of the definition": at [213]. The primary judge concluded at [218]: "However, having carefully considered Mr Robertson's submissions, I am not persuaded that the view which I had expressed in Arco Iris is incorrect. I remain satisfied that there is no necessity for any vertical linear relationship between any apartment falling within the concept of shop top housing to be directly above any of the ground floor commercial or business premises that provide the anchoring foundation for the permissibility of such a development. To adopt the approach advanced for the Applicant, I am satisfied, would lead to a perverse and irrational outcome by rendering it impossible to approve any of the apartments above the ground level that were entirely to the north of an imaginary vertical line drawn from the northernmost extent of the commercial premises on the ground floor."
Mr Lahoud challenged the primary judge's decisions on two related grounds of appeal: first, that the primary judge erred in not finding that the development was prohibited development because it was not for the permissible use of shop top housing (ground 7) and, second, that the primary judge erred in not finding that the development was not for shop top housing, because two thirds of the ground floor of the building (predominantly the carpark) was for residential use and was not used for commercial premises (retail premises or business premises) (ground 8).
The question of characterisation of whether the proposed development is for the permissible use of shop top housing raises a jurisdictional fact: Woolworths Ltd v Pallas Newco Pty Ltd (2004) 61 NSWLR 707; [2004] NSWCA 422 at [86], [88], [136], [140], [181]-[182], [219]. Hence, the primary judge could decide the question on the evidence before the court. The primary judge did so, but in doing so, did not address Mr Lahoud's argument. Nevertheless, the primary judge's conclusion that the development could be characterised as being for "shop top housing" was correct, as Mr Lahoud's argument was flawed.
Mr Lahoud's argument was based on two incorrect interpretations of the definition of "shop top housing." The first was that the phrase "ground floor retail premises or business premises" demands that the whole of the ground floor of the building be used for retail premises or business premises. This first interpretation underlay the argument that because the carpark on the ground floor of the building could not be characterised as being for retail premises or business premises (two types of commercial premises), then the dwellings above the ground floor could not answer the description in the definition of being "above ground floor retail or business premises." This interpretation is incorrect. The phrase in the definition does not demand that the whole or even the majority of the ground floor of a building be used for retail premises or business premises. Rather, it requires only that there be retail premises or business premises on the ground floor of the building. The proposed development did propose two business premises on the ground floor, a larger one with access from Sailors Bay Road and a smaller one with access from Harden Avenue. Those business premises accounted for around 40% of the length of the building fronting Harden Avenue, according to the Council assessment report. That proportion of the ground floor of the building being used for business premises cannot be viewed as being de minimis; it satisfied the phrase in the definition that there would be "ground floor retail premises or business premises."
The second incorrect interpretation was to conflate the definition's use of the word "dwellings" with "residential use". Mr Lahoud's argument was that because the carpark was to be used overwhelmingly by the occupants of the new apartments, the carpark should be characterised as being used for the purpose of residential use. This argument invoked my statement in Chamwell Pty Ltd v Strathfield Council (2007) 151 LGERA 400; [2007] NSWLEC 114 at [43], quoting Glass JA in Foodbarn Pty Limited v Solicitor-General (1975) 32 LGRA 157 at 161, that "where a part of the premises is used for a purpose which is subordinate to the purpose which inspires the use of another part, it is legitimate to disregard the former and to treat the dominant purpose as that for which the whole is being used." Mr Lahoud argued that in this case, the carparking spaces on the ground floor which are allocated to particular residential premises have the character of being for residential uses (not business or retail uses).
That characterisation of the use of the carpark was not a relevant inquiry. Regardless of whether the carparking spaces were allocated for use by the owners and occupiers of the apartments in the building, the carpark could not become a "dwelling" within the meaning of that term in the Dictionary of WLEP. The carpark was not a room or suite of rooms occupied or used or so constructed or adapted as to be capable of being occupied or used as a separate domicile. Hence, even if the carpark could be said to be used for the purposes of "residential uses" (Mr Lahoud's term), it did not comprise one or more dwellings. There was, on this basis, no disabling of the operation of the definition of "shop top housing" because one or more dwellings were not located above ground floor retail premises or business premises.
Once the definition of "shop top housing" is properly construed, the proposed development can be characterised as being for shop top housing. On all floors above the ground floor of the building, there were proposed to be dwellings. On the ground floor of the building, there were two business premises. The dwellings on floors 1 to 4 would be located above the business premises on the ground floor. This arrangement satisfied the definition of shop top housing. The Panel and the primary judge did not err in so finding. Grounds of appeal 7 and 8 are rejected.

The contamination grounds

By grounds 5 and 6 of the judicial review summons, Mr Lahoud challenged the Panel's decision on the basis that the Panel had failed to consider the matters required to be considered by cl 7(1) of SEPP 55 (ground 5) and cl 7(2) of SEPP 55 (ground 6).
Clause 7(1) of SEPP 55 provides: "(1) A consent authority must not consent to the carrying out of any development on land unless: (a) it has considered whether the land is contaminated, and (b) if the land is contaminated, it is satisfied that the land is suitable in its contaminated state (or will be suitable, after remediation) for the purpose for which the development is proposed to be carried out, and (c) if the land requires remediation to be made suitable for the purpose for which the development is proposed to be carried out, it is satisfied that the land will be remediated before the land is used for that purpose."
Mr Lahoud argued that the Panel failed to consider whether the land on which the proposed development was to be carried out was contaminated.
Clause 7(2) of SEPP 55 provides: "Before determining an application for consent to carry out development that would involve a change of use on any of the land specified in subclause (4), the consent authority must consider a report specifying the findings of a preliminary investigation of the land concerned carried out in accordance with the contaminated land planning guidelines."
The land specified in cl 7(4) of SEPP 55 is: "(a) land that is within an investigation area, (b) land on which development for a purpose referred to in Table 1 to the contaminated land planning guidelines is being, or is known to have been, carried out, (c) to the extent to which it is proposed to carry out development on it for residential, educational, recreational or child care purposes, or for the purposes of a hospital- land- (i) in relation to which there is no knowledge (or incomplete knowledge) as to whether development for a purpose referred to in Table 1 to the contaminated land planning guidelines has been carried out, and (ii) on which it would have been lawful to carry out such development during any period in respect of which there is no knowledge (or incomplete knowledge)."
Mr Lahoud argued that, as the proposed development involved a change of use, and the land was land specified in cl 7(4), the Panel was required, but failed, to consider a report specifying the findings of a preliminary investigation of the relevant land carried out in accordance with the contaminated land planning guidelines.
Mr Lahoud argued that the reason why the Panel failed to consider whether the land was contaminated was the assessment by the Council's Environmental Health Officer that "no excavation works are being undertaken." If no excavation of the land was to be undertaken, there would be no disturbance of any contamination of the land. Mr Lahoud argued that the officer's statement was factually incorrect. Mr Lahoud adduced evidence in the court below seeking to establish that there had been a fuel bowser and an underground fuel tank on the land, which might have contaminated the land around the fuel bowser.
Notwithstanding setting out at length the arguments and evidence of the parties on these grounds, the primary judge did not decide the grounds. At most, the primary judge found there to be "the real possibility that Grounds 5 and 6 are made out" (at [290]). But elsewhere, the primary judge was content to proceed "on the assumption these grounds are made out": at [294], and see also [295], [296], [309], [310] and [313].
The primary judge proceeded to consider whether, on the assumption that grounds 5 and 6 were made out, he would, in the exercise of the discretion under s 9.46(1) of the EPA Act, "make any orders intervening with the Company's development consent": at [294]. The primary judge canvassed a number of matters (in [297]-[310]) but found that they did not "warrant any intervention in these proceedings" (at [310]). One of those matters was the reliability and credibility of Mr Lahoud as a witness and another was his failure to raise the issue of the potential contamination of the site in his objection to Helm's development application (at [304]-[308]).
The primary judge found that: "The failure of the Council's assessing officer in the submission in the Council's report to the Planning Panel that there was to be no excavation as part of the Company's development (and, by necessary implication, no triggering need for consideration of matters arising under the SEPP) does not, in light of the other matters outlined above, constitute a reason to intervene with the Company's development consent on the basis of Grounds 5 and 6.": at [312].
Hence, the primary judge held "no relief would be appropriate to be ordered.": at [313].
Both Mr Lahoud and Helm challenged the primary judge's decision on grounds 5 and 6. Mr Lahoud raised as grounds of appeal that the primary judge erred by: 1. not finding that the grounds had been established (ground 9); 2. exercising his discretion to withhold relief (ground 10); 3. taking into account in the exercise of his discretion the extraneous consideration of punishing Mr Lahoud for giving evasive evidence (ground 11); and 4. making adverse credit findings against Mr Lahoud (ground 12).
Helm raised in its notice of contention that the primary judge should have dismissed grounds 5 and 6 on the basis that Mr Lahoud failed to establish that the Panel's decision was affected by the jurisdictional errors alleged by Mr Lahoud (contention 4).
It is appropriate to deal first with ground of appeal 9 and contention 4, as if Mr Lahoud fails to establish that the Panel breached cl 7(1) and (2) of SEPP 55, there is no need to address grounds of appeal 10-12 which concern the primary judge's decision to withhold relief for any assumed breach of cl 7(1) and (2).
Grounds 5 and 6 of the judicial review summons claimed the Panel's decision involved the jurisdictional error of failing to consider relevant matters. The onus lay on the challenger, Mr Lahoud, to establish that the Panel did fail to consider matters it was obliged to consider.
The first matter Mr Lahoud claimed the Panel was obliged to consider, but did not consider, was whether the land was contaminated. The obligation to consider this matter arose from cl 7(1)(a) of SEPP 55. Mr Lahoud argued that the Panel did not consider this matter at all, not that it inadequately considered the matter, what Street CJ in Parramatta City Council v Hale (1982) 47 LGRA 319 at 335 referred to as "a failure sub modo" to consider a relevant matter.
Mr Lahoud argued that the court would draw the inference that the Panel failed to consider whether the land is contaminated from the statement in the Council assessment report that the proposed development did not involve any excavation. The primary judge was attracted to this argument, finding that "the triggering basis upon which Grounds 5 and 6 are advanced is the material error in the Council officer's assessment report asserting that there would be no excavation on the site arising as a consequence of the Company carrying out the approved development.": at [289].
However, Mr Lahoud's argument and the primary judge's attraction to the argument lack evidentiary foundation. There was sufficient material before the Panel evidencing consideration of cl 7 of SEPP 55 and the extent of excavation.
As previously noted, the Panel gave among its reasons for decision, "[t]he reasons outlined in the Council assessment report." The Council assessment report recorded the Council's Environmental Health Officer as stating "No objection subject to conditions" and making the following comments on SEPP 55: "SEPP 55 remediation of land was considered as part of the proposed change of use for the development. As no excavation works are being undertaken, further contamination investigation is not considered necessary as future occupants will not be exposed to excavated soils and contamination risks are not increased by the proposal."
Attachment 6 to the report contained an assessment of the matters in s 4.15(1) of the EPA Act that the Panel was required to consider, including the provisions of any applicable environmental planning instruments. One of these instruments was SEPP 55. The report stated: "SEPP 55 - Remediation of Land As the proposal is for adaptive re-use and limited to no excavation is proposed, the development is considered satisfactory by Council's Environmental Health Officer subject to recommended conditions of consent."
Of note, the Council's assessing officer corrected the Council's Environmental Health Officer's statement that there would be "no" excavation to instead be that "limited to no excavation is proposed".
The recommended conditions of consent included one dealing with the identification during site redevelopment of previously unidentified contaminated soils or materials. Condition 53 provided: "Unexpected Finds Protocol An unexpected finds contingency plan should be incorporated into site redevelopment works. In the event that previously unidentified contaminated soils or materials are identified during site redevelopment, works should cease in the immediate vicinity and the affected area isolated to minimise disturbance. A suitably qualified contaminated site consultant should be engaged to assess the degree, type and extent of contamination and establish a remediation plan. The Site Manager/landowner shall notify Council in writing when they become aware of any contamination. (Reason: Environment & Health Protection)"
The Council assessment report assessed the development application and accompanying documents. The development application form asked as question 8, "Does your proposal require any excavation work in a commercial/industrial zone or are you aware of any previous potentially contaminating activities on the site? If yes you are required to provide a preliminary investigation report." Helm answered this question "No".
On this material, the inference cannot readily be drawn that the Panel did not consider SEPP 55 at all or in particular the question raised by cl 7(1) of SEPP 55 of whether the land is contaminated. As I have noted, Mr Lahoud's challenge was not that the Panel inadequately considered cl 7(1) of SEPP 55 but that it did not consider it at all. That challenge was not made out on the material before the Panel.
Consideration of evidence not before the Panel, in the form of the report of Mr Barry, an engineer called by Mr Lahoud at the hearing in the court below, could not assist. The question of whether the Panel considered the relevant matter of cl 7(1) of SEPP 55 could be answered only by having regard to the material that was before the Panel at the time of its decision. Mr Barry's report was not before the Panel and was prepared 8 months later for the judicial review proceedings. Mr Barry's opinion, based on information provided by Mr Lahoud, that the land was contaminated from a fuel bowser and an underground fuel tank on the land and concerning the need for and extent of excavation to carry out the approved development, was irrelevant to the question of whether the Panel considered the matter under cl 7(1)(a) of SEPP 55 at the time it made its decision. The report should not have been admitted by the primary judge but even if it had been properly admitted, it provided no basis for the primary judge to find, even as a "real possibility", that the Panel failed to consider the matter in cl 7(1)(a). Mr Lahoud's ground 5 was not established.
The second matter Mr Lahoud claimed the Panel was obliged to consider, but did not consider, was a preliminary investigation report under cl 7(2) of SEPP 55. The obligation on the consent authority to consider a preliminary investigation report is triggered by a development application seeking consent "to carry out development that would involve a change of use of any of the land specified in subclause (4)." To be land specified in cl 7(4), the land must meet one or more of the criteria in (a) to (c).
Mr Lahoud argued that the land met the criteria in (b) and (c) of cl 7(4). One of the purposes of development referred to in Table 1 to the contaminated land planning guidelines is "service station". Mr Lahoud adduced evidence in the court below that he had observed, since about the early 1980s, a fuel bowser at the north-east corner of the land. Mr Lahoud said the bowser was located adjacent to the eastern side of the driveway serving the lower parking level of the building on the land. According to documentary evidence, that building on the land was a three storey office building that had been erected in the early 1970s, replacing a residence on the land. The fuel bowser supplied fuel for the trucks of a hardware store that operated at the time on the immediately adjoining land to the east, which Mr Lahoud's company redeveloped to erect the current building in the mid-1990s. Mr Lahoud recalled that the fuel bowser was removed from the land in about 1999 or 2000, when the existing building was built, replacing the earlier office building built in the 1970s.
Mr Lahoud argued that, on these facts, development for the purpose of service station was known to have been carried out on the land, so as to engage the criterion in (b). Alternatively, Mr Lahoud argued that there was "no knowledge (or incomplete knowledge)" as to whether development for the purpose of service station had been carried out on the land. Mr Lahoud argued that it would have been lawful to have carried out such development during the period in respect of which there was no knowledge or incomplete knowledge. In these circumstances, the criterion in (c) was engaged.
The onus of establishing that the land on which the development was proposed to be carried out was land specified in cl 7(4) rested on Mr Lahoud as the challenger. He did not discharge this onus.
First, the only purpose of development referred to in Table 1 to the contaminated land planning guidelines Mr Lahoud relied on was the purpose of service station. "Service station" is defined in the Dictionary to WLEP as meaning: "a building or place used for the sale by retail of fuels and lubricants for motor vehicles, whether or not the building or place is also used for any one or more of the following - (a) the ancillary sale by retail of spare parts and accessories for motor vehicles, (b) the cleaning of motor vehicles, (c) installation of accessories, (d) inspecting, repairing and servicing of motor vehicles (other than body building, panel beating, spray painting, or chassis restoration), (e) the ancillary retail selling or hiring of general merchandise or services or both."
"Service station" has been similarly defined in previous environmental planning instruments applying to the land. Even on the evidence adduced by Mr Lahoud in the court below that there was a fuel bowser on the land, there was not a use of the land for the purpose of service station as defined. Mr Lahoud adduced no evidence of the use of the land for the sale by retail of fuels and lubricants for motor vehicles, an essential characteristic of use for the purpose of service station. To the contrary, the fuel dispensed by the fuel bowser was used for the trucks of the hardware store operating on the adjoining land, later redeveloped by Mr Lahoud's company.
Second, Mr Lahoud did not establish that development for the purpose of service station "is known to have been carried out" on the land. To establish that the Panel breached cl 7(2) at the time of making its decision to grant development consent, Mr Lahoud needed to establish that development for the purpose of service station was known at that time to have been carried out on the land. No such evidence was adduced. There was no material before the Panel establishing that a service station or any other development for a purpose referred to in Table 1 to the contaminated land planning guidelines had ever operated on the land. To the contrary, the development application form answered in the negative the question of whether the applicant was aware of any previous potentially contaminating activities on the site.
Third, Mr Lahoud did not establish that, at the time the Panel made its decision to grant development consent, "there is no knowledge (or incomplete knowledge)" as to whether development for the purpose of service station had been carried out on the land. Establishing this matter requires, first, establishing the fact that development for the purpose of service station had been carried out on the land and, second, that there was no knowledge or incomplete knowledge as to that fact. It is not sufficient to establish a lack of knowledge or incomplete knowledge about what developments have been carried out on the land. Mr Lahoud did not establish that the land had been used for the purpose of a service station and hence could not establish that there was a lack of knowledge or incomplete knowledge about that use.
Having failed to establish that the land proposed to be developed was land specified in cl 7(4), Mr Lahoud could not establish that the Panel breached cl 7(2). The obligation to consider a preliminary investigation report is only triggered by development that would involve a change of use on land specified in cl 7(4). For these reasons, ground 6 is not established.
The conclusion that grounds 5 and 6 of the judicial review summons are not established resolves Helm's contention 4 and Mr Lahoud's ground of appeal 9: contention 4 should be upheld and ground 9 rejected.
This conclusion also makes it unnecessary to decide Mr Lahoud's grounds of appeal 10, 11 and 12. Nevertheless, it is appropriate to record that the primary judge's adverse credit findings about Mr Lahoud, which are the subject of grounds 11 and 12, were unnecessary for two reasons.
First, unless and until the primary judge found that the Panel's decision was made in breach of cl 7(1) and 7(2) of SEPP 55, no occasion arose for deciding whether and what relief should be granted to remedy any breach. The primary judge deliberately refrained from deciding that the Panel breached cl 7(1) or cl 7(2), instead proceeding on the assumption that grounds 5 and 6 were made out. The occasion therefore never arose for the primary judge to consider how he ought to exercise a discretion to grant or withhold relief for a breach that had not been established.
Second, the relief Mr Lahoud sought was a declaration that the development consent was invalid by reason of a breach of the EPA Act, which includes a breach of cl 7 of SEPP 55, being an environmental planning instrument made under the EPA Act. The conduct of the person bringing the proceedings seeking to remedy a breach of the EPA Act, and the credit of that person as a witness, will ordinarily be irrelevant to the exercise of a discretion as to whether to grant a declaration of invalidity. These were not matters the primary judge ought to have considered in deciding whether or not to declare invalid the development consent for the Panel's assumed breach of cl 7(1) and cl 7(2) of SEPP 55. In these circumstances, the primary judge ought not to have made the adverse credit findings concerning Mr Lahoud.

Contention that proceedings time-barred

Helm raised as a contention in the court below and again in its notice of contention in this court that Mr Lahoud's proceedings were commenced out of time. Under s 4.59 of the EPA Act and cl 124 of the Environmental Planning and Assessment Regulation 2000 (NSW) (EPA Regulation), the proceedings challenging the validity of the development consent needed to have been commenced not more than three months after public notice of the granting of the consent was given. Public notice of the granting of the consent was given, in accordance with s 4.59 of the EPA Act and cl 124 of the EPA Regulation, on 15 July 2021. Mr Lahoud commenced the judicial review proceedings challenging the consent on 14 October 2021, just within the three month period.
Nevertheless, Helm argued that two earlier notifications published on 30 June and 1 July 2021 also constituted notices under s 4.59 of the EPA Act and cl 124 of the EPA Regulation, so that the three month limitation period for bringing proceedings challenging the development consent ran from those dates. In that event, the proceedings brought by Mr Lahoud were outside the three month limitation period.
The primary judge rejected Helm's contention. The primary judge found that the notifications published on 30 June and 1 July 2021 "were not in the express and confined terms of the details specified by s 4.59 itself": at [49]. The notice published on 15 July 2021, however, "did comply strictly with the requirements for a notice set by s 4.59 in terms and was published in compliance with cl 124 of the 2000 Regulation": at [49]. As a consequence, the primary judge was "satisfied that the three-month time period specified by s 4.59 did not commence to run until 15 July 2021, thus rendering those proceedings commenced on 14 October 2021 as being within time": at [50].
Helm contended that the primary judge erred in finding that the notifications published on 30 June and 1 July 2021 did not comply with s 4.59 of the EPA Act and cl 124 of the EPA Regulation. The notifications were of the same document, entitled "Determination and Statement of Reasons" of the Willoughby Local Planning Panel. The document recorded that the Panel held a public meeting on 29 June 2021 by teleconference and dealt with Helm's development application between 2.14pm and 2.59pm. The document recorded: (a) as the "matter determined", the development for which consent was sought and which was to be carried out as "DA-2020/238 at 131 Sailors Bay Road, Northbridge NSW 2063. Adaptive conversion of the existing building into shop top housing including additional level"; (b) under "Panel consideration and decision", the matters the Panel considered, the Panel's satisfaction of the cl 4.6 request, and the Panel's determination to approve the development application; (c) the Panel's "reasons for the decision"; and (d) the conditions of consent.
This document was published on the Panel's website on 30 June 2021 on a page entitled "WLPP meeting - 29 June 2021 - Determination and Statements". The document was next published on the Council's "ePlanning Portal" webpage on 1 July 2021 on a page entitled "DA Tracker".
Helm argued that those publications of this document satisfied the requirements of cl 124 of the EPA Regulation for giving notice in that the document was "published on the consent authority's website" and did "describe the land and the development the subject of the development consent". Helm argued that a notice does not need to state that it is a notice for the purposes of s 4.59 of the EPA Act.
I find that the notifications given on 30 June and 1 July 2021 were not notices for the purposes of s 4.59 of the EPA Act, as they were not given in accordance with the regulations. First, the notification given on 30 July 2021 was not published on "the consent authority's website", as required by cl 124 of the EPA Regulation. The notification was on the Panel's website, not on the Council's website. The Council is the consent authority, notwithstanding that the Panel, by a Ministerial order, determined the development application on behalf of the Council.
Second, neither notification stated it was a notice for the purposes of s 4.59 of the EPA Act. Neither the title nor the text of each document published on the Panel's and the Council's websites informed the reader that it was a public notice of the granting of consent for the purposes of s 4.59 of the EPA Act so as to start the running of the three month limitation period for commencing legal proceedings questioning the validity of the consent. Equally, the titles of the webpages of the Panel's and the Council's websites on which the document was published did not inform the reader specifically or in another way that it was such a notice for the purposes of s 4.59 of the EPA Act. The giving of public notice under s 4.59 of the EPA Act, in accordance with cl 124 of the EPA Regulation, has the serious legal consequence of precluding the commencement of legal proceedings questioning the validity of a consent after the expiry of three months from the date of that notice. People need to be notified in clear terms of that serious legal consequence. The notifications published on 30 June and 1 July 2021 did not do so.
For these reasons, the primary judge did not err in finding that only the notice given on 15 July 2021 constituted the public notice for the purposes of s 4.59 of the EPA Act. Contention 1 is rejected.

Conclusion and orders

Mr Lahoud has not established any of the grounds of appeal challenging the primary judge's rejection of the grounds of judicial review of the Panel's decision to grant development consent. Helm, however, has established the contentions challenging the primary judge's upholding of two grounds of review of the Panel's decision. These conclusions mean that Mr Lahoud's appeal should be dismissed and certain of Helm's contentions upheld.
The primary judge's decision to order Mr Lahoud to pay 80% of Helm's costs in the court below was dependent on the primary judge's decision that Mr Lahoud was partially successful in the court below. That costs order should be set aside and replaced with an order that Mr Lahoud pay Helm's costs of the proceedings in the court below. Mr Lahoud should also pay Helm's costs of the appeal in this court.
The orders I propose this court make are: 1. The appeal is dismissed. 2. Contentions 2, 3 and 4 of the second respondent's notice of contention are upheld. 3. Order 3 of the orders of Moore J made on 2 November 2023 is set aside. 4. In lieu of order 3 of Moore J, the appellant as applicant is to pay the second respondent's costs of the proceedings in the Land and Environment Court. 5. The appellant is to pay the second respondent's costs of the proceedings in this court.

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: 10 July 2024

Environmental Planning and Assessment Regulation 2000(NSW)

(2007) 151 LGERA 400

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