Lend Lease (Millers Point) Pty Limited v Council of the City of Sydney - [2014] NSWLEC 64 - NSWLEC 2013 case summary — Zoe

NSWNSWLEC

Lend Lease (Millers Point) Pty Limited v Council of the City of Sydney

[2014] NSWLEC 64

Land and Environment Court (NSW)|2013-12-10|Before: Pain J, Ms J

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At a glance

Source facts

Court

Land and Environment Court (NSW)

Decision date

2013-12-10

Before

Pain J, Ms J

Catchwords

(2005) 221 CLR 99 Hurstville City Council v Minister for Planning and Infrastructure [2012] NSWLEC 134
(2012) 189 LGERA 269 Lend Lease GPT (Rouse Hill) v Hills Shire Council [2010] NSWLEC 130

Source

Original judgment source is linked above.

Catchwords

(2005) 221 CLR 99 Hurstville City Council v Minister for Planning and Infrastructure [2012] NSWLEC 134(2012) 189 LGERA 269 Lend Lease GPT (Rouse Hill) v Hills Shire Council [2010] NSWLEC 130

Judgment (31 paragraphs)

[1]

Council of the City of Sydney (Respondent) Representation: Mr N Williams SC with Ms A Mitchelmore (Applicant) Mr B Walker SC with Ms J Shepard (Respondent) Herbert Smith Freehills (Applicant) Council of the City of Sydney (Respondent) File Number(s): 40101 of 2013

[2]

Judicial review challenge to rates notices 1The Applicant, Lend Lease (Millers Point) Pty Ltd (LLMP) challenges decisions of the Respondent, the Council of the City of Sydney (the Council) to issue rates notices under the Local Government Act 1993 (LG Act) in relation to the area of Barangaroo that it is developing, namely lot 3 and parts of lot 5 and 6 of DP 876514 (the rated land). This is the area of the stage 1 development in Barangaroo South. LLMP contends that in issuing the rates notices with respect to the rated land, the Council erred in failing to apply the rating exemption in s 555(1)(a) of the LG Act, which provides that "land owned by the Crown, not being land held under a lease for private purposes", is "exempt from all rates". 2The freehold title to the rated land is vested in the Barangaroo Delivery Authority (BDA). Between July 2010 and November 2012, the BDA granted LLMP a series of licences to enter portions of the Barangaroo site to carry out certain works. Those portions are the rated land. Other parts of the Barangaroo site are not the subject of the challenged rates notices. 3Three rates notices are challenged. The first rates notice dates from 7 July 2010, the date of execution of the first of six licences which the BDA has granted to LLMP in relation to the rated land. 4It is common ground that the rated land is Crown land. The issue in these proceedings is whether the rated land is "land held under a lease for private purposes" within the meaning of the exemption from the payment of rates for Crown land in s 555(1)(a) of the LG Act. That raised three separate issues addressed by the parties, whether the licences were leases as defined in the LG Act, whether the land was held, and finally if there were leases whether these were for private or public purposes.

[3]

Evidence 5There is substantial agreement between the parties about the facts pertinent to this dispute. The statement of agreed facts (SOAF) was tendered (exhibit A). It states as follows: Definitions 1 In these Agreed Facts, terms are defined as follows: a. Barangaroo Land means Lots 1, 3, 5 and 6 of deposited plan 876514 in New South Wales. b. BDA means the Barangaroo Delivery Authority. c. BDA Act means the Barangaroo Delivery Authority Act 2009 (NSW). d. PDA means Barangaroo Stage 1 Project Development Agreement which is the subject of Agreed Facts [20] and [21] below. e. Relevant Period means the period 7 July 2010 to 30 June 2013 (inclusive). f. Rated Land means lots 3, parts of lot 5 and 6 of DP 876514, being the land south of the "Stage One Boundary" line of the Barangaroo Land, that line being marked on the document labelled Respondent's Annexure A to the Points of Defence. 2 Unless otherwise defined, defined terms in this Agreed Statement of Facts have the same meaning as in the PDA other than for "Licensed Area" which is defined with respect to each of the relevant licences. The Barangaroo Land and the BDA 3 The Barangaroo Land forms part of an approximately 22 hectare site known as Barangaroo. 4 On 4 June 2009, title to the Barangaroo Land was vested in the BDA for an estate in fee simple. 5 The BDA is constituted under the BDA Act as a corporation which is, for the purposes of any Act, a NSW Government Agency. 6 As a NSW Government Agency, the BDA has the status, privileges and immunities of the Crown in right of New South Wales. 7 In the exercise of its functions, the BDA is subject to the control and direction of the Minister administering the BDA Act. 8 The Barangaroo Land is Crown land within the meaning of the Crown Lands Act 1989 (NSW) and the Local Government Act 1993 (NSW) (the LG Act). The Barangaroo Concept Plan 9 On 9 February 2007, the then Minister for Planning approved a concept plan submitted by the Sydney Harbour Foreshore Authority (SHFA), the predecessor in title of the Barangaroo Land, for development of the Barangaroo Land, subject to modification (Barangaroo Concept Plan). 10 The Barangaroo Concept Plan was approved in approval MP06_0162 and, as at November 2013, has subsequently been modified on four occasions. 11 In addition to approving the Barangaroo Concept Plan, the Minister also approved the inclusion of the Barangaroo Land in the State Environmental Planning Policy (Major Development) 2005 as a State Significant Site. 12 The Approved Concept Plan includes the following key aspects for Barangaroo South: a. a maximum of 490,240 square metres of gross floor area (commercial, retail and residential); b. public waterfront promenade the length of the site; c. three commercial towers with maximum floor area of 351,882 square metres; The maximum height for the tallest tower will be 209 metres and the other two towers will be 180 metres in height; d. 800 residential apartments with a maximum floor area of 105,358 square metres and an estimated 1500 residents; e. an additional hotel building has been approved with a maximum floor area of 33,000 square metres. This building is currently the subject of negotiation between Lend Lease and the NSW Government; and f. all buildings to be held by way of 99 year lease from the Barangaroo Delivery Authority. Development of Barangaroo South 13 The development of the Barangaroo Land commenced with a tender process (Stage 1 Tender) for the development of the southern portion of the Barangaroo Land known as Barangaroo South (Stage 1 Development). 14 In April 2008, SHFA called for expressions of interest (EOI) in the Stage 1 Tender. 15 On 25 September 2008, SHFA informed Lend Lease Development Pty Limited (LLD) that it had been shortlisted for the Stage 1 Tender and issued LLD with a request for detailed proposals (RFDP). 16 In August 2009, the BDA issued LLD with a Stage 1 RFDP- Final Phase Proponent Brief (Final Phase RFDP). 17 On 5 November 2009, LLMP was incorporated as a wholly owned subsidiary of LLD. 18 On 20 December 2009, LLMP was announced as the successful bidder in the Stage 1 Tender. The PDA for the Barangaroo Stage 1 Development 19 On 5 March 2010, the BDA, LLMP and Lend Lease Corporation Limited entered into the PDA. 20 The PDA has been amended on a number of occasions by the following documents on the following dates: a. First deed of amendment, 8 June 2010 b. Second deed of amendment, 30 July 2010 c. Third deed of amendment, 23 December 2010 d. Fourth deed of amendment, 14 June 2012 21 The PDA provides for the BDA to grant construction licences to LLMP to permit LLMP to carry out the Stage 1 Works (Construction Zone Licence). 22 A Construction Zone Licence, as provided for by the PDA as executed, granted to LLMP, as Developer, "a non-exclusive licence to access and occupy the Developer Secured Area". On 23 December 2010, the PDA was amended so as to grant to LLMP, as Developer, "a non-exclusive licence to access and use the Developer Secured Area". Licences 23 Between July 2010 and November 2012, the BDA granted LLMP a series of licences as set out below at paragraphs [24] to [38]. First Access Licence 24 On 7 July 2010, the BDA granted a 'Barangaroo Stage 1 Early Works Licence' to LLMP (First Access Licence). 25 The First Access Licence was in force from 7 July 2010 to 6 July 2011 pursuant to clause 2.2 and, pursuant to clause 2.1, granted to LLMP, as the Developer, "a non-exclusive licence to access and occupy the Licensed Area". Second Access Licence 26 On 21 July 2011, the BDA granted a 'Barangaroo Stage 1 Basement 1A Works Licence' to LLMP (Second Access Licence). 27 The Second Access Licence was in force from 7 July 2011 to 13 July 2012 pursuant to clause 2.2 and, pursuant to clause 2.1, granted to LLMP, as the Developer, "a non-exclusive right to access and use the Licensed Area". C4 Construction Zone Licence 28 On 6 July 2012, the BDA granted a Construction Zone Licence to LLMP pursuant to clause 13.1 of the PDA (C4 Construction Zone Licence). 29 The C4 Construction Zone Licence commenced on 7 July 2012 and expires on the Practical Completion of the relevant Stage 1 Works Portion, being the Commercial Building C4 works the subject of the approval granted by the Minister for Planning for Major Project No 10_0025 (C4 Construction Zone Licence Period). 30 The C4 Construction Zone Licence granted to LLMP, as Developer, "a non-exclusive licence to access and use the Developer Secured Area". Basement Construction Zone Licence 31 On 6 July 2012, the BDA granted a Construction Zone Licence to LLMP pursuant to clause 13.1 of the PDA (Basement Construction Zone Licence). 32 The Basement Construction Zone Licence commenced on 7 July 2012 and expires on the Practical Completion of the relevant Stage 1 Works Portion, being the works the subject of the approval granted by the Minister for Planning for Major Project No 10_0023 (Basement Construction Zone Licence Period). 33 The Basement Construction Zone Licence granted to LLMP, as Developer, "a non-exclusive licence to access and use the Developer Secured Area". Third Access Licence 34 On 12 July 2012, the BDA granted a 'Barangaroo Stage 1 Sisco/C3 C5 Pilings Licence' to LLMP (Third Access Licence). 35 The Third Access Licence was in force between 13 July 2012 and 14 July 2013 pursuant to clause 2.2 and, pursuant to clause 2.1, granted to LLMP, as the Developer, "a non-exclusive licence to access and use the Licensed Area". C5 Construction Zone Licence 36 On 9 November 2012, the BDA granted a Construction Zone Licence to LLMP pursuant to clause 13.1 of the PDA (C5 Construction Zone Licence). 37 The C5 Construction Zone Licence commenced on 9 November 2012 and will expire on the Practical Completion of the relevant Stage 1 Works Portion, being the works associated with Commercial Building C5 (C5 Construction Zone Licence Period). 38 The C5 Construction Zone Licence granted to LLMP, as Developer, "a non-exclusive licence to access and use the Developer Secured Area". Rates and Charges Notices 39 The respondent issued LLMP with the following rates and charges notices on or about 7 December 2012 with respect to the Rated Land: a. Notice for the period 7 July 2010 to 30 June 2011 in the amount of $3,428,670.95 (First Rates Notice); b. Notice for the period 1 July 2011 to 30 June 2012 in the amount of $7,057,445.95 (including balance brought forward) (Second Rates Notice); c. Notice for the period 1 July 2012 to 30 June 2013 in the amount of $10,769,380.95 (including balance brought forward) (Third Rates Notice): and d. Notice for the amount of $5,384,690.95, being 50% of the total rates levied by the Third Rates Notice. Liabilities and Responsibilities 40 LLMP obtained and paid for public liability insurance in relation to works on the Rated Land for the Relevant Period. 41 LLMP procured an OH&S plan from the Builder and provided warranties in relation to the effect of compliance with that plan in accordance with the requirements of clause 36 of the PDA in relation to the Rated Land during the Relevant Period. 42 LLMP commenced paying for the provision of the following services to the Rated Land at the following times: a. Electricity: in or around November 2010; b. Water: in or around August 2010; c. Sewerage (comprising a connection to a pre-existing sewer point on the Rated Land): in or around June 2011; and d. Telecommunications (comprising 3 telephone lines): in or around December 2010. 43 LLMP paid for and undertook activities, commencing in the last quarter of 2010 and from time to time during the Relevant Period, relating to the establishment of the construction site on the Rated Land, including the installation of hoardings and the taking of measures to secure the construction site. 44 LLMP engaged contractors, including but not necessarily limited to AECOM Australia Pty Ltd, to undertake investigation works on the Rated Land during the Relevant Period. 45 In or about June 2010, LLMP engaged contractors, including but not necessarily limited to, Casey & Lowe Pty Ltd, to carry out archaeological works which commenced in or about August 2010, pursuant to the approval for Major Project MP 07_077 as part of the Early Works (as defined in the PDA). Subleases 46 Confidential Agreed Fact: LLMP has entered into agreements in relation to the future tenancy of part of the commercial buildings including, but not limited to, the following: a. "Agreement for Sub-lease" with KPMG Australian Services Pty Ltd as trustee for the KPMG Australia Service Trust dated 17 February 2012, pursuant to which LLMP agrees to procure a sub-lease from the Lessor (defined in that Agreement as a person whom the BDA has confirmed is an Acceptable Tenant and who accepts a Call Offer made by the BDA pursuant to cl 27 of the PDA, or, alternatively, LLMP, if a Put Offer has been accepted by the BDA pursuant to cl 28 of the PDA), CONFIDENTIAL. b. "Office Agreement for Lease" with Westpac Banking Corporation dated 21 June 2012, pursuant to which LLMP agrees to procure a sub-lease from the Lessor (defined in that Agreement as a person whom the BDA has confirmed is an Acceptable Tenant and who accepts a Call Offer made by the BDA pursuant to cl 27 of the PDA, or, alternatively, LLMP, if a Put Offer has been accepted by the BDA pursuant to cl 28 of the PDA), CONFIDENTIAL. c. Agreement for sub-lease with Lend Lease Management Services Limited dated 7 July 2012, pursuant to which LLMP agrees to procure a sub-lease from the Lessor (defined in that Agreement as a person whom the BDA has confirmed is an Acceptable Tenant and who accepts a Call Offer made by the BDA pursuant to cl 27 of the PDA, or, alternatively, LLMP, if a Put Offer has been accepted by the BDA pursuant to cl 28 of the PDA). 47 LLMP has entered into a memorandum of understanding with CBRE (RP) Pty Ltd on 3 April 2013 in relation to the sale (by way of 99 year leases) of residential apartments within the two residential buildings known as Anadara and Alexander. All 159 of those apartments were sold off the plan on 31 August 2013. Profit 48 LLMP is currently paying, by instalment, moneys to the BDA which, by the expiry of the PDA will total in excess of several hundred million dollars in accordance with the terms of the PDA. 49 The current budgets of LLMP, which are varied from time to time, are based on a number of assumptions as to future events which may prove to be incorrect and are only accurate as a prediction to the point in time at which they are created, show that LLMP anticipates making a profit and thereby receiving a benefit from the development of the Rated Land.

[4]

Further evidence 6LLMP tendered three volumes of documents and one volume of redacted documents (exhibit B). The exhibits to Mr Simon Hardy's affidavit (exhibit C) and to Mr Gavin Biles' affidavit (exhibit D) were also tendered. 7In addition to the bare facts referred to in the SOAF at par 23 to 38 in relation to the access and construction zone licences the following facts were also agreed. First access licence: On 7 July 2010, the BDA granted the "Barangaroo Stage 1 Early Works Licence" to LLMP (exhibit B tab 5), commencing on that date and continuing in force until 6 July 2011 (cl 2.2). Pursuant to cl 2.1, the BDA granted to LLMP, as the developer, a non-exclusive licence to access and occupy the licensed area in order to do all things necessary to carry out the early works in accordance with the developer's obligations under this document and for any other use which the BDA approves in its absolute discretion. The term early works was defined in cl 1.1 to mean each of (exhibit B tab 5 p 15): (a)works the subject of: (i)Major Project Approval No 07_0077, which was granted in 2007 and, in summary, permitted demolition of a number of existing structures on the site (not limited to Barangaroo South) (exhibit B tab 22 p 2108); (ii)Major Project Approval 10_0023, which was granted in 2010 and, in summary, permitted bulk excavation, remediation and construction of a basement car park. From 3 March 2011, by reason of a modification the Minister made to the approval, LLMP could not do any work pursuant to this approval until the Minister had approved a site-specific Remediation Action Plan (exhibit B tab 24 p 2168). (b)investigation works on an area of the site known as Block 5, which was within the area that the Office of Environment and Heritage had declared to be contaminated under the Contaminated Land Management Act 1997 (defined in the PDA as the declaration area), which was to be the subject of a Pt 3A approval; (c)establishment of survey controls; (d)geotechnical and environmental investigative works, including drill points and test pitting with respect to those works; (e)archaeological test pitting, investigative and excavation works, including test pitting, open excavation, screening and stockpiling with respect to the archaeological investigative works. 8The licensed area was the areas shaded pink and yellow in Attachment 1 to the first access licence (first access licence period land). Clause 2.3 of the licence prohibited LLMP from using the first access licence period land for a purpose other than as provided for in cl 2.1. Pursuant to cl 2.5, the parties agreed that the PDA applied to the licensed area as if it were a developer secured area and that it applied to the early works as if they were works or part of a works portion and to the document as if it were a construction zone licence. The developer secured area is as defined in the plans attached to the various licences. 9Clause 3.1 stipulated that LLMP did not have exclusive possession or occupation of the first access licence period land and that LLMP was not a tenant of the BDA. Clause 3.2 prohibited LLMP from doing "anything to interfere with the access of the Authority or the Authority's employees to the licensed area other than as permitted under the [PDA]". Pursuant to cl 3.3, LLMP was required to make a written request to the BDA to obtain its consent before undertaking any early works which might disrupt access to and use of the foreshore pedestrian walkway (the area of the licensed area shaded yellow). As a condition of giving its consent, the BDA could require LLMP to undertake work to divert the walkway around the proposed works or otherwise maintain a safe pedestrian traffic flow along it. Clause 3.5 of the first access licence prevented LLMP from transferring, assigning, sub-licensing or granting an encumbrance over the first access licence period land. 10Second access licence: On 21 July 2011, the BDA granted the Barangaroo stage 1 basement 1A works licence to LLMP (exhibit B tab 6), which was in force from 7 July 2011 to the earlier of 6 July 2012 or the date of termination of the PDA (cl 2.2). The terms of the licence were largely identical to the first access licence, including the description of the works for which the licence conferred permission on LLMP to carry out; some further works were added, including (exhibit B tab 6 p 25-6): (a)investigation works within the declaration area which were by now the subject of Major Project Approval MP 10_0087; and (b)piling and footings works under Major Project No 10_0025 (building C4), but only to the extent that they were not VMP remediation works. 11In addition, in cl 2.4 of the second access licence, LLMP acknowledged that the BDA could grant licences to other parties (known as other contractors) to access and use the BPL area, which was defined by hatching on Attachment 2 to the licence, for the purpose of carrying out various works including the pedestrian linkage works (cl 2.4(a)). LLMP acknowledged that this meant that it and its employees inter alia may be executing work on the licensed area at the same time as the other contractors, and it was required to fully cooperate and coordinate the works with the work to be carried out by the other contractors, and to perform its works to minimise any interference with or disruption or delay to the work of any of the other contractors (cl 2.4(b); also cl 2.5(c)(vii)). 12C4 construction zone licence: On 6 July 2012, the BDA granted a construction zone licence to LLMP pursuant to cl 13.1 of the PDA (exhibit B tab 7). The licence commenced on 7 July 2012 and expires on the practical completion of the relevant stage 1 works portion, being the commercial building C4 works which were the subject of the approval granted for Major Project No 10_0025 (C4 construction zone licence period). In accordance with the terms for construction zone licences in Sch 2 of the PDA, the licence confers a non-exclusive right on LLMP to access and use, for the C4 construction zone licence period, the relevant developer secured area, being: (a)for the period 7 July 2012 - 30 June 2014, that part of the Barangaroo land shaded pink and yellow in Attachment 1 to the letter of 6 July 2012 titled "Project Development Agreement - Construction Zone Licence- C4" (exhibit B tab 7 p 40); and (b)for the period 1 July 2014 - practical completion of the relevant stage 1 works portion, that part of the Barangaroo land shaded pink and yellow in Attachment 2 to the letter of 6 July 2012 titled "Project Development Agreement - Construction Zone Licence - C4" (exhibit B tab 7 p 41). 13The C4 construction zone licence made provision for the exclusion of what had been the BPL area in the second access licence - now referred to as the Wynyard Walk temporary lands - upon the BDA giving LLMP 15 business days' notice (exhibit B tab 7 p 38 par 4(d)). The licence contained the same provision as appeared in the access licences in relation to requiring the BDA's permission to undertake works which may disrupt access and use of the foreshore pedestrian walkway (see exhibit B tab 7 par 5, p 38). Clause 4.1 of Sch 2 of the PDA provides that LLMP does not have exclusive possession or occupation of the developer secured area and that LLMP is not a tenant of the BDA. 14Basement construction zone licence: On the same day, the BDA granted a construction zone licence to LLMP pursuant to cl 13.1 of the PDA with respect to the works the subject of Approval MP 10_0023 (exhibit B tab 8). There are some differences between the C4 construction zone licence and the basement construction zone licence, including the term, the different works portion and the further provision which is made with respect to site coordination. However, the basement construction zone licence is largely in the same terms as the C4 construction zone licence, including in relation to the Wynyard Walk temporary lands and the foreshore pedestrian walkway. 15The basement construction zone licence commenced on 7 July 2012 and expires on the practical completion of the stage 1 works portion. It confers a non-exclusive right on LLMP to access and use, for the basement construction zone licence period, the relevant developer secured area, being: (a)for the period from 7 July 2012 - 30 June 2014, that part of the Barangaroo land shaded pink and yellow in Attachment 1 to the letter of 6 July 2012 titled "Project Development Agreement - Construction Zone Licence - Stage 1A Basement" (exhibit B tab 8 p 45); and (b)for the period 1 July 2014 - practical completion of the works portion, that part of the Barangaroo land shaded pink and yellow in Attachment 2 to the letter of 6 July 2012 titled "Project Development Agreement- Construction Zone Licence- Stage 1A Basement" (exhibit B tab 8 p 46). 16Under the heading Site Co-ordination, LLMP acknowledged that the BDA could grant a construction zone licence to another person for the purposes of construction over a part of Barangaroo, and in those circumstances, it undertook that it would make no objection to the BDA granting a construction zone licence over that part of the developer secured area relevant to the stage 1A basement works portion that is reasonably necessary in connection with the works to be carried out by that other person (exhibit B tab 8 p 44 par 6). 17Third access licence: On 12 July 2012, the BDA granted the Barangaroo stage 1 Sisco/C3 C5 pilings licence to LLMP (exhibit B tab 9). The terms of the first and third access licences are largely the same, with key differences relating to the term of the licence, the definition of the relevant works and the area. The third access licence was in force between 13 July 2012 and 14 July 2013 pursuant to cl 2.2 and granted to LLMP, as the developer, a non-exclusive licence to access and use the licensed area, being the areas shaded pink and yellow in Attachment 1 to the third access licence (third access licence period land). The third access licence period land did not include all of the area referred to in the first and second licence areas as the BPL area. 18The works in respect of which the third access licence was granted (cl 2.1(a)) were: (a)works the subject of Approval MP 10_0087 (which permitted LLMP to undertake a pilot trial of remediation technology) (exhibit B tab 26); (b)the same geotechnical and archaeological works as permitted in the first and second access licences; and (c)piling and footings work under Major Project MP 11_0044 (for the commercial tower C3) and MP 10_0227 (the commercial tower C5), to the extent that they were not VMP remediation works. 19In addition to granting LLMP access to and use of the third access licence period land for this purpose, the BDA also granted access and use to carry out any Climate Positive Initiative contemplated or required to be delivered by LLMP under the PDA, provided that all necessary approvals had been obtained in connection with that use (cl 2.1(b)) (exhibit B tab 9 p 50). 20C5 construction zone licence: On 9 November 2012, the BDA granted a construction zone licence to LLMP pursuant to cl 13.1 of the PDA (exhibit B tab 10). The C5 construction zone licence commenced on 9 November 2012 and will expire on the practical completion of the relevant stage 1 works portion, being the works associated with commercial building C5 (C5 construction zone licence period). It confers a non-exclusive right on LLMP to access and use, for the C5 construction zone licence period, the relevant developer secured area, being: (a)for the period from 9 November 2012 - 30 June 2014, that part of the Barangaroo land shaded pink and yellow in Attachment 1 to the letter of 9 November 2012 titled "Project Development Agreement Construction Zone Licence - C5" (exhibit B tab 10 p 60); and (b)for the period 1 July 2014 - practical completion of the relevant stage 1 works portion, that part of the Barangaroo land shaded pink and yellow in Attachment 2 to the letter of 9 November 2012 titled "Project Development Agreement - Construction Zone Licence - C5" (exhibit B tab 10 p 61). 21The terms of the C5 construction zone licence are largely identical to the C4 construction zone licence. 22The affidavit of Mr Simon Hardy, a Director of LLMP and Executive Director, Design and Infrastructure for the stage 1 development sworn on 23 August 2013 was read by LLMP. It sets out Mr Hardy's professional background, his involvement with the Barangaroo South Development, the BDA's involvement in the Barangaroo South Development, activities for which BDA approval is required, the Barangaroo Management Committee and Works Control Groups, access to and work done on Barangaroo South, the terms of the basement construction zone licence, the C4 construction zone licence, the third access licence, the C5 construction zone licence and the foreshore walkway. During the period of the first access licence Mr Hardy recalls that the types of work undertaken were demolition, investigation works, archaeological works and site establishment works (par 55). During the period of the second access licence during the last quarter of 2011 Mr Hardy states that LLMP commenced construction of the perimeter retention wall. Before construction could commence on the wall it was necessary to construct ancillary works such as the groundwater treatment facility and the bentonite plant (par 59). The affidavit indicates that the BDA closely monitors the progress of the development and is actively engaged in all aspects of the development where the PDA requires that it be consulted or that its approval be obtained (par 16-21). 23The affidavit of Mr Gavin Biles, General Manager Project Solutions - Development with Lend Lease Development Pty Limited, sworn on 26 August 2013 was read by LLMP. Mr Biles states that LLMP cannot access the site without a licence from the BDA. Mr Biles refers to the PDA making provisions for the grant of licences. To his knowledge for the first year and a half following execution of the PDA, LLMP was not in a position to commence a works portion. However there were early works which LLMP could carry out for which it needed a licence for access. As an example of these early works Mr Biles refers to demolition of the cruise passenger terminal called Wharf 8 (par 8). Mr Biles states that although the first access licence permitted LLMP to carry out construction works pursuant to two approvals granted by the Department of Planning and Infrastructure, his recollection is that LLMP undertook no construction work on Barangaroo South before the middle of 2011 as it had to wait for the Minister to approve a remediation action plan for the basement works (par 12). Mr Biles describes the works that were carried out during the first access licence period including site establishment works, demolition works (demolition of Wharf 8 and a number of structures on the site), investigation works, archaeological works and survey controls (par 13).

[5]

Barangaroo Delivery Authority Act 2009 24The Barangaroo Delivery Authority Act 2009 includes the following sections: 3 Objects of Act The objects of this Act are as follows: (a) to encourage the development of Barangaroo as an active, vibrant and sustainable community and as a location for national and global business, (b) to create a high quality commercial and mixed use precinct connected to and supporting the economic development of Sydney, (c) to facilitate the establishment of Barangaroo Headland Park and public domain land, (d) to promote the orderly and sustainable development of Barangaroo balancing social, economic and environmental outcomes, (e) to create in Barangaroo an opportunity for design excellence outcomes in architecture and public domain design. 6 Constitution of Authority There is constituted by this Act a corporation with the corporate name of the Barangaroo Delivery Authority. 7 Status of Authority The Authority is, for the purposes of any Act, a NSW Government agency. 14 Functions-generally (1) The Authority has the following functions: (a) to promote, procure, facilitate and manage the orderly and economic development and use of Barangaroo, including the provision and management of infrastructure, (b) to promote, procure, organise, manage, undertake, secure, provide and conduct cultural, educational, residential, commercial, transport, tourist and recreational activities and facilities at Barangaroo, (c) to develop and manage the Barangaroo Headland Park and public domain so as to encourage its use by the public and to regulate the use of those areas, (d) to facilitate and provide for appropriate commercial activities within the Barangaroo Headland Park and public domain that are consistent with their use for cultural, educational and recreational activities and the use and enjoyment of those areas by the public, (e) to promote development within Barangaroo that accords with best practice environmental and town planning standards, is environmentally sustainable and applies innovative environmental building and public domain design, (f) to liaise with Government agencies with respect to the co-ordination and provision of infrastructure associated with Barangaroo, (g) to undertake the delivery of infrastructure associated with Barangaroo or that relates to the principal functions of the Authority. (2) The Authority cannot employ any staff. Note. Staff may be employed under Chapter 1A of the Public Sector Employment and Management Act 2002 in the Government Service to enable the Authority to exercise its functions. (3) The Authority is not limited to exercising its functions on or in relation to land within Barangaroo. (4) The Authority may only exercise its functions with respect to land outside Barangaroo with the approval of the Minister. 17 Land dealings (1) The Authority has no power to sell or exchange the whole or any part of any land vested in the Authority (other than the Barangaroo Headland Park), or to otherwise dispose of the fee simple estate in that land, except by way of surrender to the Crown. (2) However, the Authority may, with the consent of the Minister and subject to such conditions as the Minister thinks fit, mortgage, lease or otherwise dispose of an interest (other than the fee simple) in land vested in the Authority (other than the Barangaroo Headland Park) and grant easements or rights-of-way over land vested in the Authority or any part of it. (3) This section does not require the Authority to obtain the consent of the Minister to a lease or licence for a term that, together with the term of any further lease or licence that may be granted under an option in respect of it, does not exceed 10 years. (4) The Authority must establish and maintain a public register of all land that is, from time to time, vested in or managed by the Authority. (5) A lease or licence granted under this section must not have a term that, together with the term of any further lease or licence that may be granted under an option in respect of it, exceeds 99 years. 18 Restrictions on disposal of Barangaroo Headland Park (1) The Authority has no power to sell or exchange the whole or any part of the Barangaroo Headland Park, or to otherwise dispose of the fee simple estate in that land, except by way of surrender to the Crown. (2) However, the Authority may, with the consent of the Minister and subject to such conditions as the Minister thinks fit, lease, mortgage or otherwise dispose of an interest (other than the fee simple) in the Barangaroo Headland Park or affect or create an estate or interest in the Barangaroo Headland Park. (3) This section does not require the Authority to obtain the consent of the Minister to a lease or licence for a term that, together with the term of any further lease or licence that may be granted under an option in respect of it, does not exceed 10 years. (4) A lease or licence granted under this section must not have a term that, together with the term of any further lease or licence that may be granted under an option in respect of it, exceeds 99 years.

[6]

Local Government Act 1993 25The dictionary to the LG Act provides the following definition: lease: (a) includes an original lease, derivative lease or an under-lease or an agreement for any of them, and extends to any case where there is the relation of landlord and tenant, whether there is or is not any instrument in writing, and (b) in relation to Crown land, land owned by or vested in the Crown or land within a State forest-includes a licence, permit, permissive occupancy or authority (other than a licence or permit under the Forestry Act 2012), and land occupied under a mineral claim under the Mining Act 1992 is taken for the purposes of this Act to be held under a lease by the person in lawful occupation, under the mineral claim, of the land. Chapter 15 How are councils financed? Part 5 Levying of rates and charges Division 1 General 546 How is a rate or charge levied? (1) A rate or charge is levied on the land specified in a rates and charges notice by the service of the notice. (2) The notice may be served at any time after 1 July in the year for which the rate or charge is made or in a subsequent year. ... Part 6 What land is rateable? 554 What land is rateable? All land in an area is rateable unless it is exempt from rating. 555 What land is exempt from all rates? (1) The following land is exempt from all rates: (a) land owned by the Crown, not being land held under a lease for private purposes. ... Part 7 Payment of rates and charges 560 Who is liable to pay rates? (1) The owner for the time being of land on which a rate is levied is liable to pay the rate to the council, except as provided by this section. (2) If land owned by the Crown is leased, the lessee is liable to pay the rate, except as provided by subsection (4). (3) If there are two or more owners, or two or more lessees from the Crown, of the land, they are jointly and severally liable to pay the rate. (4) The Crown is liable to pay the rate for land owned by the Crown which is subject to the Housing Act 1912 or the Aboriginal Housing Act 1998. 561 Who is liable to pay charges? The person liable to pay a charge is: (a) the person who, if the charge were a rate and if the land on which the charge is levied were rateable in respect of that rate, would be liable under section 560 to pay the rate, or (b) the Crown in respect of land owned by the Crown, not being land held under a lease for private purposes. 562 Payment of rates and annual charges (1) Annual rates and charges may be paid in a single instalment or by quarterly instalments. ... 570 Transfer of land in payment of rates or charges A council may accept a transfer of the land in respect of which rates or charges are or accrued interest is due and payable in full satisfaction of the rates, charges or accrued interest. 571 What happens if land is transferred? (1) A person who disposes of an estate in land continues to be liable to pay a rate or charge levied in respect of the land if the rate or charge was levied: (a) before the estate was disposed of, or (b) after the estate was disposed of but before notice of the transfer was given as required by this Act. (2) A person who, as the holder of a licence, permit, permissive occupancy or authority under the Crown Lands Act 1989, was liable for rates or charges continues to be liable to pay a rate or charge levied in respect of the land subject to the licence, permit, permissive occupancy or authority if the rate or charge was levied before the licence, permit, permissive occupancy or authority was terminated or expired. (3) A person who becomes liable for rates and charges levied on land is liable to the council for a rate or charge owing in respect of the land even though the person was not so liable when the rate or charge was levied. 573 What happens if land is subdivided? If land is subdivided, and a part is sold or let, any unpaid rates or charges may be apportioned by the council on the recommendation of the Valuer-General. 574 Appeal on question of whether land is rateable or subject to a charge (1) A person who has an estate in land, or who is the holder of a licence or permit for land under the Crown Lands Act 1989, in respect of which a rates and charges notice is served may appeal to the Land and Environment Court: (a) in the case of a rate-against the levying of the rate on the ground that the land or part of it is not rateable or is not rateable to a particular ordinary rate or a particular special rate, or (b) in the case of a charge-against the levying of the charge on the ground that the land is not subject to any charge (excluding a charge limited under section 503 (2)) or is not subject to the particular charge. (2) An appeal may not be made under this section on the ground that land has been wrongly categorised under Part 3. (3) An appeal must be made within 30 days after service of the rates and charges notice. (4) If the Land and Environment Court determines that only a part of land is rateable, it is required to determine the value of that part. Chapter 17 Enforcement Part 2 Proceedings by the council or its employees Division 4 Legal proceedings for the recovery of rates and charges 712 Special provisions with respect to the recovery of unpaid rates and charges (1) Proceedings for the recovery of a rate or charge may be commenced at any time within 20 years from the date when the rate or charge became due and payable. (2) All rates and charges payable by the same person, whether in respect of the same or of different land, may be recovered in a single action. (3) In any proceedings for the recovery of a rate or charge, a court may decide any matter that is called into question and that is relevant to the determination of the proceedings, even though the matter would otherwise be beyond the court's jurisdiction. (4) A court's decision on any matter that would, but for this section, be beyond its jurisdiction is relevant only to the determination of the proceedings in which it is called into question and is of no effect in relation to any other proceedings. (5) No matter in respect of which a right of appeal is given under section 574 may be called into question in any proceedings for the recovery of a rate or charge so as to prevent its recovery if the time within which the right of appeal may be exercised has expired. (6) Service of a rates and charges notice or notice of a charge may not be called into question more than 10 years after the date of alleged service of the notice. (7) Proceedings for the recovery of any rate or charge by the enforcement of the charge it comprises on the land are not to be taken in any court, except proceedings for the purposes of Division 5.

[7]

Crown Lands Act 1989 26In s 3 of the Crown Lands Act 1989 (the CL Act), Definitions, Crown land is defined as ... land that is vested in the Crown or was acquired under the Closer Settlement Acts as in force before their repeal, not in either case being: (a) land dedicated for a public purpose, or (b) land that has been sold or lawfully contracted to be sold and in respect of which the purchase price or other consideration for the sale has been received by the Crown. 27Sections 6 and 7 provide: 6 Crown land to be dealt with subject to this Act etc Crown land shall not be occupied, used, sold, leased, licensed, dedicated or reserved or otherwise dealt with unless the occupation, use, sale, lease, licence, reservation or dedication or other dealing is authorised by this Act or the Crown Lands (Continued Tenures) Act 1989. 7 Relationship with other Acts This Act shall not be construed so as to affect the operation of a provision of any other Act which: (a) makes special provision for any particular kind of Crown land, or (b) authorises Crown land to be disposed of or dealt with in any manner inconsistent with this Act. 28Part 4 Sale, lease etc of Crown land, Div 3 Leases of Crown land s 41 and s 42 provide: Division 3 Leases of Crown land 41 Term The term of a lease of Crown land (including any option for the grant of a further term) granted by the Minister is not to exceed 100 years. 42 Certain dealings to be leases A disposition of Crown land by the Minister on behalf of the Crown, expressed to be a lease, is a lease even if exclusive possession of the land is not conferred on any person. 29Division 4 Licences in Pt 4, s 45 provides: Division 4 Licences 45 Licences (1) Without limiting section 34A, a licence may authorise the use or occupation of Crown land for such purposes as the Minister thinks fit. (2) A licence may be granted for such term as the Minister thinks fit. (3) Subject to section 49, the Minister may grant a licence for any purpose over Crown land that is the subject of a lease granted under this Part or the Crown Lands (Continued Tenures) Act 1989, but only with the consent of the lessee. (4) Subject to section 49, the holder of a lease referred to in subsection (3) may grant a licence over Crown land the subject of the lease to enable the carrying out of a filming project, but only with the consent of the Minister and on such terms and conditions as the Minister determines. (5) Subsection (4) does not require the consent of the Minister if the terms of the lease permit the grant of a licence without the Minister's consent and use of the land for the purpose of a filming project is authorised by the lease or is generally consistent with the purposes for which the land may be used under the lease. (6) Consent may be given to the grant of a licence under subsection (4) that will enable the carrying out of a filming project, and the licence may be granted, despite any provision to the contrary in the lease. Note. This subsection also applies to licences in respect of Crown reserves. See section 34A (6) (b).

[9]

Issue 1(a) are licences within definition of "lease" 31The first issue to arise of whether the rated land is held under a lease has received limited judicial consideration. Two cases are referred to at the outset as the parties' submissions focussed on these. 32Sydney City Council v Garbett Pty Ltd (1993) 80 LGERA 289 considered if the holder of a general law licence fell within the LG Act's extended definition of lease in (b). The Court of Appeal (Priestley JA, Kirby and Handley JJA concurring) held that the land in question was not held under a lease for private purposes and was not rateable. Handley JA observed in obiter in relation to the issue in this case (which did not arise directly in Garbett) (at 303): If the [rated] company was a deemed lessee for rating purposes while it only had the use of the land for construction purposes, it would seem to follow that a builder building on Crown land not otherwise leased may also be a rateable lessee during performance of the building contract in cases where the land was held by the builder for private purposes. My agreement with [the lead judgment of] Priestley JA does not involve any view that the company was rateable before it became presently entitled to a lease of the property, or that a builder in possession of Crown land for building purposes is ever rateable. It is possible that licences under the general law of Crown land are not deemed to be leases of such land for rating purposes, or at least in all cases. It would be absurd for example if every Wood v Leadbitter licence (1845) 13 M & W 838; 153 ER 351 [access to racecourse] was a deemed lease for this purpose. 33Australian Convention & Exhibition Services Pty Ltd v Sydney City Council (1998) 9 BPR 16,753 (ACES) concerned Crown land at Darling Harbour vested in the Darling Harbour Authority (DHA), a statutory authority constituted under the Darling Harbour Authority Act 1984 (repealed). ACES was a contractor under a deed with the DHA and another entity. ACES claimed exemption from council rates pursuant to s 555(1)(a) of the LG Act 1993. It challenged the issue of rates notices in this Court. On appeal from the first instance decision, the Court of Appeal held that occupation of the building by ACES was for the purposes of the DHA and ACES was not liable for rates under the LG Act. 34Handley JA (Powell and Beazley JJA concurring) considered the deed between ACES and the DHA. ACES argued that the deed was not a lease or a licence, and was not a licence which attracted liability for rates under the LG Act. After considering the terms of the deed, the Court of Appeal held the companies managed and operated the Centre as agents for the DHA, at 16,756 line 25-26 and neither was a lessee. At 16,754-56 definition (a) of lease in the LG Act was considered. At 16,757 definition (b) was considered. Handley JA stated: Line 5 It is still necessary to consider whether the companies are licensees so as to be deemed lessees for the purposes of s 555(1)(a). In Sydney City Council v Garbett Pty Ltd (1993) 80 LGERA 289, 302-3 I indicated reservations about the extent to which licensees of Crown land can be rateable as deemed lessees under this provision and this case has only strengthened my reservations. Line 10 Para (b) of the definition of lease deals with Crown land and in it the word "licence" appears in association with permits and statutory rights of occupation under the Forestry Act and the Mining Act. This suggests that the licences referred to are those arising under statute. This construction is supported by s 574(1) of the Act which confers a right of appeal against a rates and charges notice on persons who have an estate in land, or who are "the [line 15] holder of a licence or permit for land under the Crown Lands Act 1989". There are some contractual licences such as those involved [sic] Wintergarten Theatre (London) Ltd v Millennium Productions Ltd [1948] AC 173 and Playgoers' Co-operative Theatres Ltd v Workers' Educational Association (1955) 72 WN (NSW) 374, which might be sufficiently similar to leases to receive the same [line 20] treatment for rating purposes. However in those cases the licensees conducted their own businesses and were in no sense servants or agents of the owner. Compare Dudgeon v Chie (1955) 92 CLR 342 ; 55 SR (NSW) 477 ; 29 ALJR 415 where a share farmer was held to be a licensee and not a tenant. It is not necessary to express any concluded view on the position of such licences and I do not do so. Line 25 The other issue argued was whether the Centre was leased to the companies for private purposes. This question does not strictly arise because the Centre was not leased, but the companies do not occupy the Centre for their own private pur-poses. They occupy it for the purpose of the Authority so that, through them, it can carry out its statutory functions. So much so that their occupation, as Dixon J explained, is that of the Authority. This is [line 30] therefore a stronger case, on this issue, for the application of the exemption than Goulburn City Council v Haines (1992) 78 LGERA 281 and Statewide Roads Ltd v Holroyd City Council (1996) 39 NSWLR 115; 90 LGERA 160. 35The parties agreed that lines 5-15 of Handley JA's judgment are ratio, the balance of the extracted passage is obiter.

[10]

LLMP's submissions 36LLMP submitted that the rated land is not land held under a lease within the meaning of s 555(1)(a) of the LG Act. The Council did not contend that the definition in (a) of lease in the LG Act applies. The issue is whether the definition of lease in (b) applies. LLMP relied on Handley JA in ACES at 16,757, lines 5-15, the ratio of the case to argue that the licences issued by the BDA to LLMP were contractual and not a licence under (b) of the definition. The reasoning in ACES is binding on the Court in this matter. 37The licences in this case are not licences granted under the CL Act and do not otherwise arise under statute, as the definition of licence in (b) was construed by Handley JA in ACES. Rather, they are contractual in nature, having been granted pursuant to the BDA Act or otherwise in order to facilitate LLMP's performance of BDA's obligations under the BDA Act. These licences arise under general contract law. 38Handley JA's views in ACES were consistent with his Honour's earlier obiter statements in Garbett at 303. In concluding that the reference to a licence in (b) of the definition of lease refers only to a licence arising under statute (such as a licence arising by operation of the provisions of Pt 4, Div 4 of the CL Act), Handley JA expressed a tentative view that certain contractual licences may, nevertheless, be licences within the LG Act's extended definition, in that some "might be sufficiently similar to leases to receive the same treatment for rating purposes". His Honour referred in this context to the licences in Winter Garden Theatre (London) Ltd v Millennium Productions Ltd [1948] AC 173 and Playgoers' Co-operative Theatres Ltd v Workers Educational Association (NSW) (1955) 72 WN (NSW) 374. The licences in those cases can be distinguished from the licence in ACES as the licensees conducted their own businesses and were not servants or agents of the owner (at 16,757). In common with leases at general law, the licences in both cases also conferred rights to exclusive occupation of the relevant premises, and described the periodic payments of the licence fee as rent: see Winter Garden at [174]-[175], and Playgoers' at [374]-[375]. 39The requirement that a licence arise under statute per Handley JA in ACES must be seen in the context of the land in issue, namely Crown land, land owned by or vested in the Crown or land within a State forest. The composite phrase, "licence, permit, permissive occupancy or authority" in definition (b) identifies rights or interests with an established statutory pedigree under Crown lands legislation. Licences in respect of Crown land, for example, are dealt with in Div 4 of Pt 4 of the CL Act. Permissive occupancies arose under s 136K of the Crown Lands Consolidation Act 1913 (repealed) and were continued by force of s 5 of the Crown Lands (Continued Tenures) Act 1989. Similarly, a number of different permits arise in respect of Crown land: enclosure permits, for example, arise under Pt 4, Div 6 of the CL Act, while permits in relation to pastoral land arose under s 39 of the Closer Settlement Act 1904 (repealed) and are also continued in force by s 5 of the Crown Lands (Continued Tenures) Act. Authorities in respect of Crown land arise from the exercise of powers to grant instruments in relation to Crown land under the CL Act. 40Leases and licences granted under the CL Act, along with permissive occupancies, may also be granted with respect to "land within a State forest" for the purposes of the Forestry Act 1916. 41Handley JA in ACES referred to the appeal against rates provisions in s 573 and s 574(1) where the words "holder of a licence or permit under the Crown Lands Act" appear. The scheme in Ch 15 of the LG Act which makes specific provision for instruments to which the CL Act applies supports LLMP's statutory construction approach. The use in the definition in (b) of the composite phrase "licence, permit, permissive occupancy or authority" identifies rights or interests with an established statutory pedigree in Crown lands legislation. That is consistent with s 571(2) of the LG Act which continues the liability of a person who holds a licence, permit, permissive occupancy or authority under the CL Act for rates after that permission has expired. Crown land held under a mineral claim, specifically identified in the extended definition of lease in (b), falls within the scope of s 571(1) as an estate in land. Section 574(1) provides for a right of appeal for a person who is the holder of a licence or permit under the CL Act in relation to a rates notice. That is consistent with the liability identified in s 571(1). The absence of reference to permissive occupancies and authorities in s 574(1) does not affect the proper construction of the provisions as part of a scheme dealing with recognised Crown tenures. 42Contrary to the Council's submissions the licences do not arise under statute by virtue of the power in s 17 of the BDA Act. The licences are contractual in nature being granted pursuant to the PDA or to facilitate LLMP's performance under the PDA. That s 17(5) of the BDA Act refers to a lease or licence granted under that section does not mean that LLMP holds the land the subject of the licence areas under a statutory licence. Section 17 places limits on the power of BDA as a statutory corporation as otherwise specified in s 50 of the Interpretation Act. This approach accords with the reference to licence in (b) as construed by Handley JA in ACES. 43In Griffith University v Tang [2005] HCA 7; (2005) 221 CLR 99 the High Court (Gleeson CJ, Gummow, Callinan and Heydon JJ, Kirby J dissenting) considered the meaning of under an enactment in the context of a decision by a university council to exclude a student. The university council argued its decision was not an administrative decision made under an enactment to which the Judicial Review Act 1991 (Qld) could apply. The majority agreed. This decision supports LLMP's submission.

[11]

Council's submissions 44Lease is defined in the LG Act. The Council conceded that the licences are not leases within the definition in (a) but submitted that the licences are within the extended definition in (b) in the LG Act. The licences confer a right to enter and occupy land and conduct certain activities which would otherwise be unlawful. In relation to Crown land a licence, whether arising under statute or contract, may come within the extended definition in (b). ACES is not authority that only purely statutory licences satisfy the definition in (b). "Arising from statute" encompasses contractual licences where the grant of the licence is authorised by statute. His Honour expressly admitted the possibility of purely contractual licences falling within that definition in obiter. Handley JA did not expressly preclude the possibility that a licence "arising under statute" may, itself, be contractual. 45There is a specific statutory regime for the grant of licences. It is common ground that the licences are with respect to Crown land. The two integers important to the Council's case relying on (b) of the statutory definition of lease, are the presence of Crown land and a licence. The further gloss contended for by LLMP that the words "licence, permit etc" only applies to "rights or interests with an established statutory pedigree under Crown lands legislation" and not to a statutory grant such as under the BDA Act ought to be rejected. No such further qualification was made by Handley JA in his judgment and the words of the legislation do not lend support to such a restricted reading. The fact that the extended definition of lease refers to Crown land does not evince an intention to limit licences to those issued pursuant to the CL Act as is self evident from the references to licences or rights issued pursuant to the Forestry Act 2012 and Mining Act 1992 included within that definition. 46There is no authority for the insertion of the words under the CL Act into (b) of the definition of lease in the LG Act (TS 58). The height of Handley JA's words in ACES is that the licences arise under statute. 47The deciding factor in ACES in determining that the managing companies were not lessees or licensees for ratings purposes was that ACES was managing the centre for the relevant authority. The reference to Crown land in the extended definition of lease mirrors the reference to Crown land and lease in s 555(1)(a) of the LG Act. 48The definition in (b) includes firstly, licences arising under statute (being contractual licences expressly authorised by statute or where the right of occupation arises from and is governed solely by the terms of a statute). Secondly, purely contractual licences where the licence is for the conduct of the licensee's own business, so that these are not expressly or impliedly revocable at will. Both are within the definition in (b). LLMP's licences rely for their validity on s 17 of the BDA Act under which the BDA has the power to grant licences. A licence is the disposition of an interest in land. Section 17(1) specifies the BDA has no power to sell or exchange any of the land in Barangaroo. Ministerial consent under subsection (2) is required for a lease or licence of more than 10 years duration. Subsection (5) considers a licence a grant under this section. No authority is otherwise conferred on the BDA to grant a licence. The licences have no general law validity other than that they were granted in accordance with that Act. Section 18 specifies restrictions in relation to the headland park in similar terms to s 17. Section 18 of the BDA Act limits the power of the BDA to sell or exchange any part of the Barangaroo Headland Park. This confirms the Council's approach that such licences were made under statute. 49Handley JA's remarks in Garbett at 303 are obiter and incorrect. Handley JA's findings in ACES are not statutory in effect and his reasons are no substitute for considering the statute. Griffith University v Tang considered a different statutory context. The statutory term considered "under an enactment" is not the relevant statutory wording in this matter. 50Licences which are contractual in nature can still be statutory. Section 50 of the Interpretation Act is irrelevant given the later specific regime under the BDA Act. Section 17(5) limits the powers of the BDA to issue a licence. That exercise of power must give rise to a statutory licence as without that enactment that licence cannot exist. That the general law of making an agreement applies does not mean the licence is not statutory.

[12]

Licences are leases within definition (b) 51Chapter 15 of the LG Act regulates the raising of finances by local councils through the imposition of rates and charges on land. Part 6 specifies that land is generally rateable. Crown land is not subject to a requirement to pay rates unless held under a lease for private purposes (s 555(1)(a)). Further, liability to pay rates for a lessee of Crown land arises specifically under s 560(2) in Pt 7. It is agreed that the rated land is Crown land vested in the BDA pursuant to the BDA Act. The first issue to arise is whether the licences are leases as defined in the LG Act (whether held for private purposes arises separately) and therefore not exempt from rates under s 555(1)(a) of the LG Act. That issue arises primarily as a matter of statutory construction of the provisions in Ch 15 Pt 6 and Pt 7 of the LG Act, extracted above at par 25, and in light of definition (b) of lease in the LG Act, informed by the BDA Act and the CL Act to some extent. The Court's task of statutory construction has not proved straightforward and this matter appears to be the first time the Court has had to construe definition (b) in the detail required by the parties' submissions. 52Brief details of the access and construction zone licences are set out above in the SOAF. The Court was provided with more agreed detail as set out above at par 7-21. It is not necessary to consider the licences in great detail to resolve this first issue except to note that the three access licences provide for non-exclusive access to the rated land in order to allow the demolition of various structures and to undertake preliminary works, and the three construction zone licences enable access to the rated land to build various structures the subject of development approvals (above at par 7-21). 53Well understood principles of statutory construction require that the words of a statute be considered by a purposive approach to their construction. In Hurstville City Council v Minister for Planning and Infrastructure [2012] NSWLEC 134; (2012) 189 LGERA 269 I stated at [55]: Section 33 of the Interpretation Act 1987 requires a construction which promotes the purpose or object of an Act over one which would not. Guidance on applying this approach was provided by McHugh, Gummow, Kirby and Hayne JJ in Project Blue Sky at 381 - 382. Their Honours stated that the "primary object of statutory construction is to construe the relevant provision so that it is consistent with the language and purpose of all the provisions of the statute", that a "legislative instrument must be construed on the prima facie basis that its provisions are intended to give effect to harmonious goals" and that "a court construing a statutory provision must strive to give meaning to every word of the provision". Brennan CJ and McHugh J in IW v City of Perth [1997] HCA 30; (1997) 191 CLR 1 at 12 also referred to the necessity of applying a construction of a statute consistent with its purpose. Where words are plain and unambiguous they should be given their ordinary and grammatical meaning, per Gibbs CJ in Cooper Brookes (Wollongong) Pty Ltd v Federal Commissioner of Taxation [1981] HCA 26; (1981) 147 CLR 297 at 305. In Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [2009] HCA 41; (2009) 239 CLR 27 at [47] the joint judgment (Hayne, Heydon, Crennan and Kiefel JJ) confirmed that statutory construction commences with a consideration of the language of the text, which may require consideration of the context, including the general purpose of the provision and the mischief it seeks to remedy. See also French CJ (in a separate judgment but agreeing with the orders of the joint judgment) at [4] - [5]. In Wilson v State Rail Authority of New South Wales [2010] NSWCA 198; (2010) 78 NSWLR 704 at [12] Allsop P stated that in construing an Act the legal and historical context must be considered at the outset. At [13] his Honour emphasised the principles in Project Blue Sky. 54In SAS Trustee Corporation v Woollard [2014] NSWCA 75 at [58] Bathurst CJ, (Tobias JA agreeing) cited Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [2009] HCA 41; (2009) 239 CLR 27 in emphasising the importance of the words of the statute. An extension of that emphasis important in this case is that additional words should not lightly be implied in legislation. Under LLMP's approach it is necessary to imply into definition (b) the words "under the Crown Lands Act". As identified in D C Pearce and R S Geddes, Statutory Interpretation in Australia, (7th ed 2011 LexisNexis) at [2.32]-[2.36] the highest appellate courts in England and Australia have stated this can occur but in limited circumstances. In Bermingham v Corrective Services Commissioner of New South Wales (1988) 15 NSWLR 292 McHugh JA stated at 302 words may be read into legislation if by inadvertence Parliament did not deal with an eventuality required to be dealt with if the purpose of the Act is to be achieved. To quote from Pearce and Geddes at [2.33] citing more of McHugh JA in Bermingham: Repeating what he had said in his dissenting judgment in Kingston v Keprose Pty Ltd (1987) 11 NSWLR 404 at 423, in which he had paraphrased the remarks of Lord Diplock in Wentworth Securities Ltd v Jones (on appeal from Jones v Wrontham Park Settled Estates) [1980] AC 74 at 105-6, McHugh JA identified the conditions (at 302): First, the court must know the mischief with which the Act was dealing. Secondly, the court must be satisfied that by inadvertence Parliament has overlooked an eventuality which must be dealt with if the purpose of the Act is to be achieved. Thirdly, the court must be able to state with certainty what words Parliament would have used to overcome the omission if its attention had been drawn to the defect. 55Spigelman CJ in R v Young [1999] NSWCCA 166; (1999) 46 NSWLR 681 is quoted in Pearce and Geddes at [2.34] where his Honour emphasised that courts must construe words actually used by Parliament whenever possible. A close consideration of definition (b) and the LG Act is required. 56The LG Act definition of lease in (b) refers to "a licence, permit, permissive occupancy or authority" without the words "under the Crown Lands Act" or similar, hence the debate before me. Each of the terms licence, permit, permissive occupancy and authority should be considered to determine if their inclusion in the definition suggests that the words under the CL Act should be implied. While the CL Act is the principal act for dealing with Crown land in NSW not all Crown land is managed under that Act. The Crown land the subject of this case is managed under the BDA Act in the sense that the land is vested in the BDA not, for example, the relevant Minister administering the CL Act. The six licences granted over the rated land are not made explicitly or implicitly under the CL Act. As this case indicates Crown land can be subject to licences other than under the CL Act. That licence, unconstrained in the definition (b), is an instrument which has effect separate from the CL Act suggests that there is no statutory imperative for implying into the definition of lease that a licence must be under the CL Act. 57The definition of lease in (b) also refers to permits and authorities. There is no reference to or provision in the CL Act for granting an interest over Crown land known as an authority, suggesting that any such interest must be granted under another statute and/or, if available, under general law. There is reference in the CL Act to the granting of permits in s 34A in Crown reserves and in s 72 in relation to a road enclosure permit. I am unaware if other permits can be granted over Crown land but consider it is likely they can as Crown land can be held other than under the CL Act. So far as I am aware, permissive occupancies arise solely under the statutory regime consisting of the Crown Lands Consolidation Act (repealed) as continued under the Crown Lands Continued Tenures Act. They are historical instruments held over Crown land. 58Licences and authorities and possibly permits over Crown land can arise other than under the CL Act, one statutory indicia that there is no basis for reading in the words contended for by LLMP. That permissive occupancies arise solely under the CL Act regime does not undermine that indicia. 59Two specific statutory regimes are referred to in definition (b) the Forestry Act and the Mining Act. Definition (b) distinguishes licences or permits under the Forestry Act, which Act regulates forestry activities on Crown land, inter alia. These licences and permits are excluded under definition (b). As advised in LLMP's written submissions, pursuant to s 14(1) of the Forestry Act, the Governor may dedicate as State forest any Crown land that is not the subject of a tenure from the Crown. Section 14(6), provides that despite subsection (1), Crown land that is the subject of a prescribed Crown tenure and that has an area of more than two hectares may be dedicated as State forest in accordance with the section. 60The other specific statute referred in definition (b) is a mineral claim under the Mining Act. The Council's oral submission (9.12.13 TS 64 l 17-32) that the specific references to two statutory schemes of the Forestry Act and the Mining Act is reason to not read in the words "under the Crown Lands Act" in the definition in (b) is correct in my view. The Council's approach to the effect that provided there is Crown land and there is a licence of that land the definition in (b) is satisfied reflects the literal drafting in the definition and accords with the plain words in the definition. The statutory context when other sections in Ch 15 are considered, also supports this approach. 61LLMP's submissions in reply focussed on Pt 6 and Pt 7 of the LG Act. In s 571(2) the holder of a licence, permit, permissive occupancy or authority under the CL Act has ongoing liability for rates after any such permission is terminated or expires for the period of the permission. In s 574(1) a person who has an estate in land or who is the holder of a licence or permit for land under the CL Act has a right of appeal in relation to a rates notice as specified in subsection (1)(a), a provision referred to by Handley JA in ACES at line 13 in 16,757. 62In contrary oral submissions, the Council referred to s 712 of the LG Act which provides for the recovery of rates and charges as supportive of its approach. Subsection 5 provides that in court proceedings for the recovery of a rate or charge no matter which could have been raised in an appeal pursuant to s 574 can be raised to prevent recovery. Not all recipients of rates notices obtain an appeal right under s 574(1). Some entities will only have the right availed of in judicial review proceedings, such as this action by LLMP. I agree with the Council's submissions that the fact that appeal rights are available to holders of a licence or permit under the CL Act does not support LLMP's construction. If it does anything, it suggests the Council's approach is correct because the legislature chose to be specific in the reference to licences or permits under the CL Act in s 571(2) and s 574(1) which contrasts with the absence of those words in definition (b). 63For the reasons stated above, there is no basis for implying the words "under the Crown Lands Act" into the composite phrase "licence, permit, permissive occupancy or authority" in definition (b). 64In light of the importance of not implying words into legislation as outlined above in par 54-55, no legislative inadvertence is identified by LLMP to support its construction. It is not necessary for the words "under the Crown Lands Act" to be implied to fill in any perceived omission by the absence of those words. The statutory scheme functions in their absence. 65Given the arguments presented it is necessary to also consider Handley JA in Garbett and ACES. In Garbett consideration of this issue by Handley JA was obiter and his approach in [303] is not binding on me. Handley JA's reasoning in ACES builds on Garbett. LLMP submitted that Handley JA's finding in ACES at lines 5-15, set out above in par 34, is directly on point and the Court is bound by that finding. The parties agreed this part of the judgment is ratio but disagree that it applies to this case. In ACES the instrument in question pursuant to which the Centre was occupied and managed was styled as a deed. At lines 5-15 Handley JA in brief reasons does not refer in line 13 to the CL Act but to "licences which arise under statute". Handley JA refers to s 574(1) which applies to persons who have an estate in land or who are the holder of a licence or permit for land under the CL Act to support his conclusion. This finding is not specifically a finding that the words under the CL Act should be implied in the definition of lease in (b), as the Council submitted. The finding is not directly on the question before me. While Handley JA refers to s 574(1) as an example of a specific statutory licence, that is as an example. The phrase "licences which arise under statute" can be interpreted widely. It follows that I am not bound by his conclusion to hold in favour of LLMP's construction arguments. Nor can the decision be substituted for the words of the statute, as the Council submitted. 66I have not canvassed much of the parties' written submissions particularly those of the Council which referred to those parts of Handley JA's judgment which are agreed to be (and are) obiter, namely lines 16-30 as these do not assist in the resolution of the statutory construction aspects of this part of the case. In obiter at lines 16-24 Handley JA refers to contractual licences such as in Winter Garden and Playgoers' as potentially being similar to leases. His Honour appears to be addressing the issue of whether land is held under a lease in these lines, which is not the issue I am presently considering. At lines 25-30 his Honour considered whether land was leased for private purposes, which issue also does not arise in this part of this judgment. 67Given my finding that the reasoning in ACES does not apply directly and cannot apply in substitution for the terms of the statute in par 65, the issue raised by the parties' submissions of whether the licences are made under general law, as LLMP submitted, or owe their existence to the BDA's powers under s 17 of the BDA Act, as the Council submitted, in addition to any powers and functions conferred by virtue of s 50 of the Interpretation Act, and are statutory licences is of less significance. That argument arose as a response to Handley JA's finding that licences must be statutory, which I have found does not apply to support LLMP's argument that definition (b) of lease must have the specific words under the CL Act implied into it. I have not therefore resolved the parties' submissions in par 42 (LLMP) and par 50 (Council) of what under a statute should mean except that I consider the meaning is potentially wide in the context of Handley JA's judgment. Further the words under a statute also do not appear in definition (b), as the Council submitted. My earlier findings concerning the strict limitations on implying words into the construction of a statute also apply to this phrase. 68I conclude that the six licences held by LLMP come within definition (b) of lease in the LG Act. Two remaining issues remain, whether the land is held by LLMP and whether it is leased for a private purpose. Only once these issues are resolved can it be determined if the exemption of Crown land from rates in s 555(1)(a) applies.

[14]

LLMP's submissions 70A person's authority to enter land pursuant to a contractual permit or licence which does not grant a right of possession (but only rights of access and limited use) does not render the land amenable to the description of land held under a lease for the purposes of s 555(1)(a) of the LG Act. The right to enter the land may be governed by the terms of the contract between the parties, but the land is not held. The word held limits the types of interests that may fall within the extended definition of lease. Section 555(1)(a) could have, but does not, for example, refer to land by reference to whether it is the subject of a lease. It is the narrower concept of holding land that triggers the operation of the exemption. 71A statute may create a licence or permit and it might be accurate to describe the land as being held under that licence. For example, under s 46 of the CL Act a disposition of Crown land said to be a licence is a licence even if exclusive possession is granted. It would be accurate to describe a person having such a licence as holding the land, which might explain why the appeal right conferred by s 574 refers to the CL Act: the draftsman had in mind land the subject of a statutory provision such that it could be described as being held by the licensee. Other statutory licences or permits, however, may fall short of being ones such that the holder of the licence or permit could be described as holding the land. 72Similarly, a right to enter land governed by the terms of a contract between the parties may be coupled with a proprietary interest. Putting those licences to one side, however, if the right to enter land is governed by the terms of a contract between the parties the land is not held in any relevant sense because a contractual licence in relation to land merely immunises the person from liability associated with otherwise unlawful entry, including in an action for trespass: see Western Australia v Ward [2001] HCA 28; (2002) 213 CLR 1 at [504] (McHugh J). 73The features of the licences summarised above do not lend themselves to the characterisation of LLMP's activities pursuant thereto constituting holding of the land so as to engage (b) of the definition of lease.

[15]

Council's submissions 74There is no basis for reading the word held in the manner proposed by LLMP such that only a person in possession or exclusive possession of land can be said to be holding the land under a lease. The construction would render otiose the extended definition of lease as it relates to Crown land which includes a licence, permit, permissive occupancy or authority, none of which would satisfy the construction contended for by LLMP. Even noting that the term licence is capable of extending to instruments conferring exclusive possession under the CL Act, the contention that the draftsperson of s 555(1)(a) of the LG Act deployed the word held to limit its application only to such licences (in addition to general law leases) does not explain why that draftsperson would include permits, permissive occupancies or authorities in the extended definition only to have such rights excluded by the word held. 75In relation to Crown land, where an instrument, including a licence, permit, permissive occupancy or authority is deemed to be a lease under the extended definition, then the land (whether occupied or used under a licence or permit inter alia) is then described as being held under the lease as a matter of practicality. This construction gives efficacy to the extended definition of lease and ought to be preferred. 76Further, the restriction of the word held to meaning possession or exclusive possession, finds no consonance with the way similar words have been used in the legislation cited. For example, landholder is defined in s 168A of the CL Act as meaning a person who is in lawful occupation or possession, or has lawful management or control of the relevant land. Further, in the same Act, holding is defined to include leases or licences under that Act (either of which may impart exclusive or non-exclusive possession (see s 3, 42 and 46 of the CL Act) and permissive occupancies. The definition of land holder under the Mining Act similarly includes holders of CL Act licences and permissive occupancies (Dictionary). 77In any case, LLMP's activities under the PDA clearly rise to at least that of possession or occupation of the developer secured area such that LLMP is holding the land. The PDA, as originally enacted, authorised the grant of licences to LLMP to access and occupy the land. Similar wording was used in the first access licence (SOAF par 22, 25). The subsequent amendment to access and use the land (SOAF par 22) should be viewed as a contrivance to avoid the argument now being ventilated. Certainly, the scale and duration of the development being undertaken by LLMP and the grant of the call offer for the 99 year lease suggest more than the mere access and use of BDA's land.

[16]

LLMP holds Crown land 78Held is not defined in the LG Act. Applying a purposive approach to construction and giving the meaning of the word held practical effect suggests that a wide meaning should be given to that term in the LG Act. It is also, applying a commonsense approach to the usual meaning, the verb commonly used to describe a lease arrangement. As the Council submitted it is difficult not to pair the noun lease with the verb to hold. 79LLMP contended for a meaning of possession or exclusive possession. Ward is cited in support of that submission. McHugh J at [501]-[504] considers the differences between a lease or licence and finds that this in part is determined by whether a legal right to exclusive possession has passed. His Honour makes no reference to the word held in his reasoning and I find the authority of little assistance as it is not directed to the statutory context before me. That statutory context confers a particular meaning to lease in relation to Crown land under the LG Act definition. 80LLMP's submissions do not reflect the particular statutory context considered in relation to the first issue of whether the land is held under a lease as defined in the extended definition of lease in (b). I have held that the licences are leases for the purpose of definition (b). The Council's construction in par 74-75 is in harmony with the extended definition (b) of lease which I have found applies to LLMP's licences in this case. That construction should be preferred. 81I accept the observations of the Council's counsel in par 76 concerning the use of the word held in its several variations in Crown lands legislation and under the Mining Act. 82My finding on the first issue did not need to depend on the precise terms of the licences such as whether they conferred possession or exclusive possession on LLMP. I agree with the Council's submission that to apply such a restricted approach would run counter to my earlier finding and there is no statutory basis in the LG Act for doing so. 83In any event and also as the Council submitted the extent of access permitted to LLMP under the licences described allowing LLMP "to access and occupy" allows occupation of the rated land, consistent with a broad construction to held. 84I conclude that LLMP holds the land under a lease(s) for the purpose of s 555(1)(a).

[18]

Barangaroo Concept Plan 2007 as described in Director-General's report to Minister for Planning 86The creation of a designated authority to oversee the development is consistent with the location of the development, its scale and its significance. The Barangaroo concept plan was first approved on 9 February 2007 (exhibit B tab 15). In recommending in his report to the Minister pursuant to s 75I of the Environmental Planning and Assessment Act 1979 (the EPA Act) that the concept plan be approved, the Director-General (exhibit B tab 16 p 1881): (a)referred to the identification of Barangaroo as a strategic foreshore site within the State Regional Environmental Plan (Sydney Harbour Catchment) 2005; (b)noted that, regionally, there were limited sites which could provide significant new foreshore open spaces and linkages within the CBD that could deliver significant amounts of new commercial and residential floor space; (c)observed that "[c]oupled with significant infrastructure improvements and recreational and cultural activities, the redevelopment of Barangaroo can contribute to sustained growth and enhance the position of Sydney within the Asia-Pacific region and the Global market more generally"; and (d)considered that the opportunity provided to build a new waterfront city park would meet the long term commitment of making Sydney Harbour a publicly accessible place, which would help satisfy the demands of the city's growing residential population and workforce as well as boosting the image of the city internationally. 87In relation to the rated land, the most significant of the subsequent modifications to the Barangaroo concept plan was Modification 4, which related to the southern portion of the site and, inter alia, proposed the enlargement of the Southern Cove (as required by the original approval) and construction of a pier in the harbour on which a landmark building was to be situated, for use as a hotel/serviced apartments (exhibit B tab 18 p 1939-1941). The public benefits that the Director-General identified, in his report for Modification 4, as resulting from the modified concept plan proposal included (exhibit B tab 18 p 2022-2023): (i)the delivery of a key site in responding to the demand for commercial floor space in the Sydney CBD to assist in developing Sydney as a global city; (ii)increased employment opportunities (total of 21,123 workers) and residential dwellings (total of 2,475 residents) to help meet targets set by the Metropolitan Strategy; (iii)provision of a harbour foreshore fully accessible by the public with wide walkways; (iv)provision of a range of urban spaces and public domain, integrated with appropriate surrounding uses to enliven these spaces, particularly with respect to the width of the waterfront promenade and the configuration of spaces between buildings; (v)recognising Barangaroo South as an opportunity to deliver a signature development of high urban design and architectural quality; (vi)provision [of] more viable commercial floor plates which will help encourage commercial and tourist development and create economic stimulus; (vii)improved mix of uses by increasing the amount of residential and community/public uses integrated into the core commercial precinct thereby encouraging greater activation for longer periods of the day and on weekends; (viii)adequate separation of vehicles and pedestrians along the waterfront promenade to ensure that a high quality experience is achieved; and (ix)provision of adequately scaled retail space at the ground plane to ensure activation, with residential above to provide visual security.

[21]

Stage 1 development 90With respect to the stage 1 development, the objectives for its design and delivery, as stated in the EOI (exhibit B tab 13 p 1619), included: (a)creating a new southern development precinct that establish a world benchmark urban waterfront design integrating new harbour foreshore public domain with buildings exhibiting design excellence; (b)responding to the increasing demand for commercial workspace that provide significant floor plates along with access to significant social and cultural amenities and quality lifestyle opportunities; (c)provide a development offering of a scale that allows for innovative precinct-wide environmentally sustainable infrastructure to support the twin challenges of reduced potable water supply and reduction in greenhouse gas emissions; (d)providing a mix of land uses within development blocks 1 to 4 that support accessible ground floor and street edge activation that is coordinated with adjoining public domain areas and the other development blocks; (e)provide a comprehensive remediation outcome for Barangaroo South; (f)work with SHFA (now, the BDA) and other agencies to provide timely and coordinated delivery of social and community infrastructure; (g)coordinate transport and access outcomes; (h)create appropriate cash flows to fund the design and construction by the NSW Government of the Headland Park and allow for the early development by the private sector of the southern precinct of Barangaroo; and (i)allow for the early delivery of and access to a new public foreshore promenade. 91The tender documents contemplated that the successful proponent for the stage 1 development would (exhibit B tab 13 p 1618): (a)design, fund, develop and market land and buildings on development blocks 1, 2, 3 and 4; (b)design, fund and develop public domain adjoining those development blocks (including the Southern Cove, waterfront parklands and foreshore promenade); (c)deliver and fund infrastructure to support the land and buildings on those development blocks and adjoining public domain; and (d)remediate land comprising those development blocks and adjoining public domain, the Southern Cove, development block 5 (and public domain adjoining that block) and possibly certain parts of Hickson Road.

[22]

PDA 2010 92The PDA was before the Court. Clause 2 of the PDA reiterates the BDA's objectives for the development of the project as a whole (cl 2.1), and the objectives for the stage 1 development in particular (cl 2.2). The PDA reserves to the BDA significant involvement in LLMP's discharging of its obligations under the PDA. For example: (a)the BDA must approve all applications for development approval under New South Wales planning laws unless the BDA agrees in writing that its approval is not required in respect of an application or class of applications (cl 10); (b)the identity of any builder contracted by LLMP to carry out the works (and the terms of any building contract entered into by LLMP and a contractor) must be provided to the BDA. A builder may not assign the building contract without the BDA's consent (cl 12.1-12.2); (c)LLMP must request the BDA to approve the identity of three independent certifiers nominated by LLMP, one of whom LLMP may then select for each works portion (cl 12.6); (d)the BDA must approve LLMP's detailed design plans for the scoped Barangaroo works (which are set out in Sch 6 of the PDA and include infrastructure and demolition works (cl 15.6-15.8)). (e)the BDA must approve LLMP's detailed design plans, performance specifications and cost estimate for unscoped Barangaroo works (cl 15.3(c)); (f)the BDA must approve LLMP's detailed design plans for the ferry facility works as that term is defined in the PDA (cl 18.2); (g)the BDA must approve plans for remediation works (cl 16.18-19) along with a draft voluntary management proposal for the BDA to then negotiate with the Office of Environment and Heritage (cl 16.22); (h)the BDA and LLMP must agree upon the appointment of an accredited site auditor (cl 17.2); (i)the BDA must approve plans of subdivision for the buildings constructed at Barangaroo South with specified circumstances in which the BDA may withhold consent acting reasonably (cl 26.4-26.5); (j)the BDA must approve policies of insurance which LLMP is required to enter into and which it proposes to enter into with third party insurers (cl 35.9); and (k)the BDA must approve OH&S Plans, as defined in the PDA (cl 36.2). 93In so far as applying for planning approvals is concerned, LLMP must: (a)regularly consult with the BDA, and keep it fully informed, in relation to all of its dealings with the Minister for Planning, the Department of Planning and the Director-General in connection with Pt 3A applications, including with respect to any environmental assessment it submits under s 75H of the EPA Act (cl 11.2); (b)at the request of the BDA or the Management Committee (as to which see below), inform the BDA or Management Committee of the progress of applications and the anticipated timing of applications and in any event must provide the BDA and the Management Committee with a rolling 12 month forecast of the timing of such applications (cl 11.7); (c)promptly give the BDA, inter alia, a copy of each application, all significant correspondence between it and any consent authority in respect of any application, all environmental assessment requirements issued by the Director-General, all submissions that it receives in relation to an application and any response to issues raised in the submissions, preferred project report and revised statement of commitments that it provides to the Director-General (cl 11.8); and (d)if an application is approved, must provide the approval to the BDA (cl 11.8), and the final plans and specifications for the works portion before work commences (cl 11.16). 94The BDA has two representatives on the management committee established under the PDA (Management Committee), which also has two representatives of LLMP, the functions of which include approving applications for development approval (additional to the BDA's consent), environmentally conscious construction plans and certain entities and individuals in the project team, as that term is defined in the PDA (cl 7- cl 9). Aside from the Management Committee, a works control group is constituted under the PDA for each works portion (cl 14). Comprising two representatives of the BDA and LLMP respectively, the purpose of the works control group is to monitor the progress of the stage 1 works and LLMP's compliance with its obligations under the PDA and the design and construction of public art at Barangaroo South. 95The PDA also confers functions on the BDA concerned with oversight and control of discrete aspects of the stage 1 development, including the power to carry out certain stage 1 works at the cost of LLMP (cl 15) and a broad power to create easements to facilitate access to public domain areas (cl 40.4).

[23]

LLMP's submissions 96The LG Act does not contain a definition of private purposes. In Goulburn City Council v Haines (1992) 78 LGERA 281 at 286, Mahoney JA stated that determining whether land held under a lease is so held for a private purpose required resolution of the following issues: (a)whether the purpose for which the land is held is essentially that of the lessor or the lessee; (b)how that purpose is to be evidenced; and (c)what is, within the provision, the meaning of "private". 97The first issue has become less significant after the Court of Appeal's decision in Statewide Roads v Holroyd City Council (1996) 39 NSWLR 115, in which Clarke JA stated (at 118) that it is "not simply a matter of looking at the purpose of the lessee", rather it was "also necessary to look at the objective purpose for which the lease is held". His Honour considered that "the Court should look not just at the purposes and motivations of [the lessee] in entering into the leases, but also the motivations of the [lessor] and the reasons why lease arrangements were utilised", although "the answer may be the same". This involves determining the "objective purpose for which the lease is held", without paying undue regard to the purpose of the lessor or lessee. 98As to the second issue, Clarke JA in Statewide outlined the general position regarding evidence of the objective purpose of the lease as follows (at 118, citing Equestrian Sports Centre v Campbelltown City Council (1987) 9 NSWLR 126; Haines at 284 (Mahoney JA); Sydney City Council v University of Technology, Sydney (1992) 78 LGERA 200 (UTS) at 201(Gleeson CJ), and Garbett at 294 (Priestley JA)): ...where the provisions of the lease stipulate the purpose for which the lessee is to hold the land, that will ordinarily be determinative of the issue. However, if the purpose is not specified or that specification is not conclusive, the purpose may be inferred from what has been said by the parties and the context in which the lease has been granted, or by reference to what the lessee is actually doing on the land in question. 99In relation to the third issue, whether the purpose of a lease is or is not a private purpose is determined by inquiring as to whether the identified purpose is "the kind of public purpose which the Crown ordinarily performs". The inquiry into the ordinary functions of the Crown involves consideration of a number of factors. 100The relevant factors include the purpose of the exemption in Haines at 285-6, the statute governing the Crown holding of land, Secure Parking Management Pty Ltd v Sydney City Council (1998) 99 LGERA 110 at 120, UTS at 208, and the approach in Statewide at 119-120 by Clarke JA. 101Accordingly, where freehold title to leased Crown land is held by a statutory authority or corporation, the functions of which are prescribed by its constituting statute, consistency between the purpose of the lease and the authority's prescribed functions is an indicator that the purpose of the lease is a purpose ordinarily performed by the Crown. The inquiry is not premised on any "requirement that the activity involved be a traditional government function": Statewide at 120. 102Using resources of the private sector to achieve a public purpose in relation to large construction projects the characterisation of the works will be important, see Statewide at 122. 103Profit or benefit of the lessee which is incidental or ancillary to a public purpose is permitted. The exemption in s 555(1)(a) still applies where the lessee derives a profit or advantage, including a substantial profit or advantage, from its holding under the lease provided that the profit derived is ancillary or incidental to the lease's public purpose: Statewide at 118. This factor relates back to the first factor identified above, in that it recognises that it will follow from the operation of the s 555(1)(a) exemption that some leases of land owned by the Crown will both import a public purpose and permit the lessee to establish some profit or advantage from its holding of the lease.

[24]

Application of principles 104Although each of the licences was or is granted to LLMP for the purpose of carrying out particular works on the rated land, that purpose cannot be viewed independently of the PDA, the parties executing the PDA and the purpose for which it was executed. So viewed, it is apparent that the licences facilitate LLMP developing a site of potentially local, regional and global significance to the State, involving a mix of public and commercial uses in a significant location, responsibility for the delivery of which has been vested in a public authority created for that very purpose. LLMP adopts the approach of Clarke JA in Statewide that on their proper characterisation the licences are not leases for private purposes. The fact that LLMP may ultimately make a substantial profit from the development does not call for the contrary conclusion. 105The call for EOIs for stage 1 emphasise the immense potential for public value in Barangaroo. The BDA was established by statute to achieve these objectives as can be seen in its objects in s 3 of the BDA Act. The BDA is a NSW Government agency under s 7 with the status of the Crown in NSW. The general functions are identified in s 14. The BDA may do all such things supplemental, incidental or consequential as may be necessary or expedient for the exercise of those functions and the more specific functions in Div 2 of Pt 3: s 15(2). In the exercise of those functions, the BDA is subject to the control and direction of the Minister, presently the Premier: s 8 and the Allocation of the Administration of Acts. 106In aid of the legislative object of facilitating the establishment of the Barangaroo Headland Park and public domain land, Div 2 of Pt 5 of the BDA Act makes provision for the establishment of a Barangaroo Fund, within the Special Deposits Account, into which all moneys received by the BDA must be paid: s 36(1). Payments out of the Barangaroo Fund may only be made for the purposes of enabling the BDA to exercise its regulatory functions, the provision of infrastructure by a public authority or council or payments in respect of liabilities transferred to the BDA under Pt 4: s 36(2). 107The project specific purpose of the BDA distinguishes it from Landcom and the Minister administering the EPA Act which entered into the agreement in Rouse Hill with Lend Lease GPT (Rouse Hill) Pty Ltd the subject of Lend Lease GPT (Rouse Hill) v Hills Shire Council [2010] NSWLEC 130; (2010) 175 LGERA 169. Landcom has different objectives which include operating as a successful business, one of the reasons why Sheahan J held in that case the lease in question was for private purposes. The Minister administering the EPA Act also has significantly different statutory functions and objectives to the BDA. 108The importance of the site for the public is emphasised in the Barangaroo concept plan, Mod 4, the PDA, the stage 1 development objectives, the tender documents for the stage 1 development.

[25]

Licences are not leases for private purposes. 109The first access licence, for example, permitted preliminary investigative works (such as survey work and soil and archaeological investigations), and works associated with MP 07_0077 and MP 10_0023. Although the licence permitted LLMP to carry out construction work pursuant to the latter approval, the evidence of Mr Biles, formerly the Project Director for the stage 1 development, is that he cannot recall LLMP undertaking any such work on the rated land before the middle of 2011 (Mr Biles' affidavit par 12). 110MP 07_0077 approved the demolition of a number of structures on the site and a number of those structures had been demolished by the time of the first access licence. The evidence of Mr Biles is that the main task that LLMP carried out under the approval, pursuant to the licence, was to demolish Wharf 8 at the southern end of the rated land (Mr Biles' affidavit par 13). 111The demolition of Wharf 8 and other lesser structures, and the investigative works also undertaken during the period, were preliminary steps in the development of the rated land, as a result of which it was cleared and its layout and composition better understood. Although the works were of assistance to LLMP in terms of its future development of the site, the nature of the works that LLMP in fact carried out pursuant to the permission conferred by the first access licence does not support its characterisation as a lease for private purposes. 112Similarly, although there were construction activities on the rated land during the period of the second access licence with the commencement of the perimeter retention wall, that construction itself entailed preliminary construction of ancillary infrastructure such as the groundwater treatment facility and the bentonite plant (Mr Hardy's affidavit par 59). The purpose of the third access licence was also to carry out preliminary works which were authorised by MP 10_0087 (exhibit B tab 27). As the Director-General observed in his s 75I Environmental Assessment Report, the approval was for the purpose of trialling two in-situ remediation methods, "to verify their effectiveness in addressing the contaminants in the soil and groundwater within parts of the Barangaroo site and Hickson Road within the Declaration Area...declared by [the then Department of Environment, Climate Change and Water] in March 2009" (exhibit B tab 26 p 2203, 2205-6). Although part of the declaration area falls within the rated land, most of the area falls outside it, as does the relevant portion of Hickson Road. 113Pursuant to the PDA, LLMP is responsible for remediating that area, for which the BDA makes a financial contribution (see cl 16-17 of the PDA). That financial contribution is appropriate in circumstances where the declaration area falls largely outside the boundary of the stage 1 development. More significantly however it emphasises that the trial for which approval was sought and obtained which was to take place for four to six months and leave no permanent structure, was being carried out by LLMP for a public purpose in effect as the contractor of the BDA, the statutory functions of which expressly include promoting development within Barangaroo that accords with best practice environmental standards. 114Although the C4 and basement construction zone licences were granted in July 2012 with respect to the formal works portions of C4 and the basement, and the C5 construction zone licence was granted in November of the same year, the purpose of permitting LLMP to access the rated land to carry out those works cannot be viewed in isolation or divorced from the public purpose of the development as a whole. As the Director-General observed in his reports for the basement works (MP 10_0023), the commercial tower C4 (MP 10_0025), and the commercial towers C3 and C5 (MP_0027, MP11_0044), the individual projects form a series of projects which will deliver the stage 1 development consistently with the BDA's objects as stated in cl 2 of the PDA (see for example exhibit B tab 23 p 2133, tab 28 p 2257, tab 30 p 2342). 115That there are commercial aspects of the stage 1 development and LLMP may make a profit from the commercial towers it is constructing must be balanced against the delivery of roads, public facilities and public walkways along with significant remediation works. 116The BDA has very active involvement in the delivery and design of the stage 1 development. The development of the buildings, associated infrastructure and public domain the subject of the construction zone licences is closely overseen by the BDA pursuant to the PDA. The yellow shaded area in the licence areas has not been readily accessible to LLMP (Mr Hardy's affidavit par 80-85). Mr Hardy's affidavit identifies that the BDA closely monitors progress of the development and is actively engaged in all aspects of the development which the PDA requires that it be consulted about or where its approval be obtained. 117The works for which the licences have been granted can and should be characterised as involving "the government using the resources of the private sector in order to provide necessary infrastructure to the public which the government did not itself have the financial resources to construct": Statewide at 119.

[26]

Council's submissions 118The present case raises similar issues to Rouse Hill and Garbett in that those two cases involved rates being levied on land the subject of developments authorised by the Minister or a government agency. 119Garbett concerned the construction and lease of an international tourist hotel on Crown land at Darling Harbour pursuant to an "agreement for lease". In determining whether the lease was for private purposes, Priestley JA looked no further than the agreement for lease which set out the project to be undertaken and concluded at 297: The project essentially involves getting a private sector project going with the government encouragement provided by the making available of the necessary land. 120In considering the purposes as stated in the relevant agreements (being those of both the relevant authority and the lessee), Priestley JA noted that a level of public interest is to be expected given that it is Crown land that is being leased (at 296-267). In addition, it is necessary to consider whether the type of activity to be undertaken is one ordinarily performed by the Crown. In that case, the development of an international tourist hotel for profit was not an activity ordinarily performed by the Crown such that the lease was held for private purposes. 121Rouse Hill is relevantly similar to the present case in that it involved the development, by tender, of infrastructure under a project development agreement between, inter alia, a government agency (in that case, Landcom) and a private company to be overseen by a joint management committee comprising members of both. In Rouse Hill, the development included residential, commercial and retail premises as well as schools and community facilities (at [13]). In determining that the company was holding the land under the relevant occupational licences for private purposes, Sheahan J accepted the Council's submission that the company's undertaking of the development for its commercial benefit was fundamental to the holding of the land such that this purpose predominated over and was not subsidiary to the public purpose of the lessor in promoting orderly urban development and community infrastructure (at [98]-[100]). 122LLMP seeks to distinguish Rouse Hill on the basis that the BDA was created for a project-specific purpose whereas Landcom was not. This is not a relevant basis upon which to distinguish Rouse Hill given Sheahan J specifically acknowledged that while the underlying development may not be a function ordinarily performed by the Crown, "ensuring it occurs, and facilitating and supervising it, may be" (at [100]). In the present case, the BDA, including through its representatives on the management committee, is doing no more than performing its public functions by supervising the construction. However, this does make the purposes for which the land is held, public. 123This is not to say that points of difference between the two cases cannot readily be identified. However, in doing so, it becomes clear that if the private purposes of the company in Rouse Hill predominated then, a fortiori, the private purposes of LLMP in the present case must also. Relevantly, the points of difference include the following: (a)In Rouse Hill, the development included residential, commercial and retail premises as well as schools and community facilities, the latter two being the type of infrastructure that, arguably, the Crown might deliver (at [13]). By contrast, the currently approved concept plan includes three commercial towers, residential blocks and a hotel (SOAF par 12) which are not the type of infrastructure for which the government is ordinarily responsible. (b)In Rouse Hill, the subdivisions were to be sold or leased by the ministerial corporation ([18] Rouse Hill); whereas, LLMP or its nominee will enter into the sub-leases directly with prospective residential or commercial tenants (SOAF par 46 and 47). (c)In Rouse Hill the developer was required to collect proceeds on the Minister's behalf and, after deducting the development fee, account to the Minister for the proceeds ([14]); whereas, LLMP is paying BDA for the right to develop the land and, at its own risk, anticipates making a profit from the development (SOAF par 48 and 49). 124LLMP seeks to align its case with Statewide on the basis that the legislature's conferral of power on public authorities to perform those purposes is an indicator that the purpose of the lease is a purpose ordinarily performed by the Crown. The difficulty with this proposition is that the BDA Act does not confer on the BDA the power to undertake the construction and development of the commercial, residential and tourist facilities itself. Rather, s 14 of the BDA Act uses words such as promote, facilitate, manage, organise and undertake the delivery of. The function or power to develop is used only with respect to the Barangaroo Headland Park and public domain (s 14(1)(c) of the BDA Act) which does not form part of the relevant land. 125Further, in Statewide, Clarke JA (at 120B) appeared to dispense with the need for any consideration of any legislative charter at all. As his Honour noted: The question is simply whether the construction and operation of roadways or tollways is a purpose that the Crown ordinarily performs. The answer to this question can only be yes. 126In the present case, the simple question as it applies to the facts at hand is whether the construction and development of commercial, residential and tourist facilities is a purpose that the Crown ordinarily performs. 127The answer to this question can only be "No" as has already been answered in Garbett and Rouse Hill. 128That the first, second and third access licences were granted for preliminary works was not a separate stage suggesting they were not held for private purposes. Priestley JA held in Garbett at 297 when considering a lease with a term of 99 years was for private purposes that same finding applied also to the preceding construction phase. Consistent with this reasoning LLMP holding the land for the construction phase was for private purposes. The second and third access licences were in place after construction had commenced in the middle of 2011 (Mr Biles' affidavit par 12). The second access licence authorised construction of pilings and footings for commercial building 4 which was carried out in late 2011 and early 2012 (Mr Hardy's affidavit par 60). The third access licence also authorised construction work of pilings and footings for commercial building 3 and 5 (MP11_0044(C3) and MP10_0227 during the period of the licence. 129The first access licence authorised works preliminary to construction from 7 July 2010 to 6 July 2011. Activities authorised included demolition of existing structures on the site, establishment of survey controls, geotechnical and environmental investigative works, and archaeological test pitting according to Mr Hardy's affidavit. Site establishment works were undertaken during late 2010/early 2011 such as the erection of demountables, lighting poles and hoarding. These works are necessarily antecedent to the construction works by LLMP. The first access licence was granted after LLMP's appointment to develop the rated land in accordance with the concept plan then in place. 130Whether the access licences were issued under the PDA or were for limited terms is immaterial. In any event, the access licences specifically invoked the PDA's terms by expressly stating the terms applied to the licensed area as if it (the licensed area) were a developer secured area under the PDA. 131LLMP is responsible for remediating the designated area for which the BDA makes a financial contribution. On LLMP's submissions this area appears to correspond to the remediation work to be undertaken outside the stated boundary. To the extent that remediation work and pilot trials have been conducted outside the rated land boundary, the work is irrelevant to the purposes for which the rated land is held. To the extent that remediation work is conducted within the rated land, it is necessarily antecedent to the development undertaken and should not be differentiated from the purposes of the construction and eventual lease of the premises.

[27]

Leases are for private purposes 132There was little disagreement between the parties about the applicable principles as largely articulated in the submissions of LLMP summarised above in par 96-103. The dispute is how the principles apply to the facts of this case. I will address the three questions identified in Haines as adapted in Statewide in order to resolve the issue of purpose. The questions are interlinked. The first question to be determined is whose purpose the lease is seeking to fulfil. The purpose of the lessee and the lessor must be considered as in Haines, or as adapted in Statewide the objective purpose for which the lease is held must be considered. Private purpose is not defined in the LG Act. The authorities confirm LLMP's submission that the exemption in s 555(1)(a) can still apply where the lessee derives a profit or advantage. Some leases both import a public purpose and permit the lessee to obtain a profit or advantage, Statewide at 120. The second question asks how the purpose is to be evidenced. As LLMP identified in its submissions, Clarke JA cited UTS in Statewide that where no purpose is specified in a lease or is not conclusive, the surrounding circumstances of the lease or what the lessee does on the land can be considered. The final question to ask is whether the lease is for a private purpose. The further question posed in relation to the third question in several cases is whether the activity the subject of the lease is the kind of public purpose which the Crown ordinarily performs. As LLMP submitted referring to Mahoney JA in Haines at 285-6, the exemption from rates is so that the Crown will lease land to private parties with the objective of using the resources of the lessee to achieve a public purpose, or the government is using the resources of the private sector to provide necessary public infrastructure it cannot afford to provide. 133I will consider three cases which have the most similarity to the facts in this case. In Garbett (1993) the Court of Appeal (Priestley JA, Kirby P and Handley JA concurring) considered how s 132(1) of the Local Government Act 1919 (repealed) (now s 555(1) of the LG Act 1993) applied in the context of an agreement for the lease of Crown land. That document was considered in some detail. In Pt 2 the agreement stated that the State Government had identified the Darling Harbour area of Sydney to be a major area for redevelopment with a mix of government and major private sector developments. The Darling Harbour Authority (DHA) was established with responsibility for the preparation of the development programme and its management and implementation. The project objectives were jointly specified as the construction of an international standard tourist hotel (at 291). The agreement provided for the construction phase of the project by a builder approved by the DHA (at 291). The only pertinent issue arising for consideration in the appeal was whether the lease was for private purposes. Mahoney JA in Haines was cited in relation to the three questions identified above (at 294). Mahoney JA's observations were quoted where his Honour stated that if a lease does not specify a particular purpose but the parties agree what the purpose, is that is relevant to determining the purpose. Further observations of Mahoney JA were quoted that the function achieved by the provision is that land owned by the Crown will not be rateable because the purpose of the Crown in holding it will be the kind of public purpose which the Crown ordinarily performs (at 295). 134Priestley JA found that the purpose for which the lease was held was to be found entirely within the lease. One level of purpose for which the land was held was the public purpose of securing on Crown land in Sydney implementation of the desired development. A more obvious level of purpose was that the land was held for the private purpose of building and then operating a hotel for private profit (at 296). His Honour found the land was held for the purposes of the DHA and the lessees. The public purpose of the DHA was to be found in the instruments by which the land had been held for the public purpose of tourism to set in motion a private project which the Crown would not ordinarily perform. His Honour concluded the land was held for the private purposes of the lessees (at 297). 135In Statewide (1996) at issue was whether Crown land used for building toll roads was held for a private or public purpose, the Court of Appeal (Clarke JA in the leading judgment, Powell JA concurring, Cole JA dissenting) holding that it was held for a public purpose. Regarding the second issue identified in Haines in determining the purpose of the lease, the purpose was specified in the lease to facilitate the implementation of the project. Project was defined and meant the financing, design, construction, operation, repair and maintenance of the motorway and all things necessarily incidental thereto. This specification was conclusive of the matter (at 118). Concerning the third issue identified in Haines the majority considered regard should be had to whether the purpose the subject of the lease was the kind of public purpose which the Crown ordinarily performs (at 119) which was answered in the affirmative (at 120). At 120 Clarke JA stated "The aim of the inquiry is not to determine whether the leasing of the operations of toll roads is a purpose ordinarily performed by the Crown. Rather, the issue is whether the function or purpose which is the subject of the lease can be characterised as such." The presence or absence of any legislative charter, scheme or power for the leasing of toll roads was not relevant to this inquiry and there was no requirement that the activity involved be a traditional government function (at 120). It was not necessary that the use for a public purpose be the exclusive purpose of the lease (at 120). The question remained whether the private purposes of the lessee in anticipating a profit was merely ancillary or incidental to the public purpose (at 122). The majority considered the purpose of the lease was to finance the construction and operation of part of a system of public highways so that the private benefit expected by the lessees was subservient or ancillary to that public use (at 122-123). 136In Rouse Hill (2010) land was acquired by the State government in order to establish a regional town centre to serve expanding urban development and population in north-west Sydney. The land was held by the applicant company under a commercial arrangement, contained in a Project Delivery Agreement (PDA) and occupied under an occupation licence with the Government of NSW through the Minister administering the EPA Act and a State government agency known as Landcom. Under the arrangements between the parties the developer took full responsibility to carry out the development, accepted all risks associated with doing so, and guaranteed a substantial financial return to the Minister over a ten-year period (at [4]-[6]). At [11]-[12] Sheahan J considered the planning history of the Rouse Hill Regional Centre as found in the Sydney Regional Environmental Plan No 19 - Rouse Hill Development Area 1989 (SREP 19) and the EOI for development of the Rouse Hill Regional Centre. The applicant, the successful tenderer, entered into the PDA which provided for the development of the regional town centre including residences, retail and commercial premises, open spaces, public and private schools, community facilities and associated infrastructure consistent with the general objectives in the SREP 19 (at [13]). Provisions of the PDA provided for the developer to collect the proceeds of the residential and commercial revenue with a percentage retained by the developer (at [14]). A joint management committee was established for the project with representatives of all three parties to the PDA (at [15]). 137Rouse Hill provides a useful compendium of cases which have determined this question, referring to older cases at [27]-[39]. The four decisions principally relevant in that matter were Haines, Garbett, Statewide and UTS and these are referred to at [42]-[71]. After consideration of the authorities Sheahan J held at [97]-[98] and [100]: 97 As noted by Mr Walker, and the authorities, any grant of Crown lands inevitably has a 'public purpose' element, and the public and a private purpose often overlap. His submissions (par 29) regarding the test under s 555(1)(a) adopted Priestley JA's comment in Garbett (at 297): "the existence of a public purpose is not of itself inconsistent with there being a simultaneous exemption-denying private purpose". As the submission says, "the issue is not whether the Development or its facilitation is a public purpose but rather whether the land is or is not held for a private purpose". See also Mahoney JA in Haines (at 285) and McHugh JA in Equestrian (at 133). 98 The submission of the Council that the applicant's "undertaking of the development for its commercial benefit was fundamental to the holding of the land" is to be preferred to the submission that "[t]he applicant held the Land for the public purpose of delivering the project as prescribed". Firstly, there is no evidence before the court that the applicant was motivated by some sense of public duty in undertaking the development, and it must be assumed that when private enterprise enters into such arrangements it is motivated by the potential for private commercial benefit. Secondly, as a reward for assuming all the risk, the applicant stands to gain substantial revenue from the sale of sites developed, in addition to collecting revenue from tenancies. ... 100 The private purpose of the applicant predominates over, and cannot be seen as subsidiary to the public purpose of the lessor in promoting orderly urban development and facilitating the development of community infrastructure for the public. Such development is not a function the Crown ordinarily performs, whereas ensuring it occurs, and facilitating and supervising it, may be.

[28]

Application of principles 138In applying the principles to the facts of this matter licences will be referred to as this reflects the evidence noting that I held above at par 68 that these licences are leases for the purposes of the LG Act. Considering the first two questions identified in Haines as adapted in Statewide, of whose purpose is served and how that is determined, it is relatively straightforward to conclude what the purposes of the licensee and licensor are, the BDA pursuing the public purpose of facilitating development of the landmark Barangaroo site of various public and private facilities. LLMP as the private developer has entered into the PDA and six licences the subject of these proceedings to undertake part of that development in Barangaroo South and make a profit in the process. That is confirmed by the documents in evidence which I will refer to briefly. The licences identify the financial arrangements between the parties and I do not need to elaborate on these more than is in the SOAF. As the SOAF records at par 46-47, LLMP is able to enter into subleases directly for the commercial buildings. The financial arrangements whereby LLMP intends to make a profit are referred to at par 48-49 of the SOAF. 139In Garbett and Statewide the Court of Appeal considered the purpose of the respective leases could be determined from the lease document. The provisions of the six licences are relatively brief as to their purpose. They all have similarly structured provisions. Clause 2.1 states that the BDA grants to LLMP (the developer) a non-exclusive licence to access and occupy or access and use the licensed area to do work specified in the licence for the term specified and subject to the conditions contained in the licence. Clause 2.5 states that the PDA applies and a number of clauses are specified. If the licences alone are considered, the dominant purpose is likely to be private given that they are directed to the completion of various building related works most of which are commercial (which I discuss more exhaustively shortly). Alternatively, as contemplated in Statewide and as LLMP submitted, the public purpose of the licences should be identified by surrounding circumstances such as the various documents I have been referred to by LLMP produced by the State Government in planning for the Barangaroo precinct. These commenced with the concept plan in 2007 and Mod 4, the EOI for the stage 1 development and the repeat of some of that material in the PDA. As extracts of these documents relied on by LLMP in its submissions are set out above I do not need to repeat them here. 140The objects of the BDA Act include the encouragement of the development of Barangaroo as a vibrant community and a location of national and global business, and the creation of high quality commercial and mixed use precinct connected to Sydney, inter alia. The BDA was established by the BDA Act. The functions of the BDA are defined in s 14 in subsection (a) to promote, procure, facilitate and manage the orderly and economic development of Barangaroo including infrastructure. The same functions in subsection (b) are specified in relation to the provision of cultural, educational, residential, commercial, transport, tourist and recreational activities and facilities at Barangaroo. The development and management of Headland Park is referred to in subsection (c) and (d). 141The establishment of the BDA under the BDA Act with the task of generating a new urban precinct for Sydney reflects the significance of this precinct to the State Government. These documents and instruments all enable a conclusion that there is a substantial public purpose served by the development of Barangaroo as a whole. Whether that is the dominant purpose of the licences must be determined separately however. 142According to the evidence before the Court, Barangaroo has three sections, Barangaroo Headland Park, Central Barangaroo and Barangaroo South. The licences in question relate to Barangaroo South. The SOAF in par 12 identifies key aspects of the approved concept plan for Barangaroo South as including a very large gross floor area for commercial, retail and residential, three commercial towers, 800 residential apartments and a hotel. Within that area also are public domain areas most notably the harbourside walkway in concluding the licences have both a public and private purpose. Up to this point the six licences can be considered together. 143At a general level it is straightforward to conclude that the licences enable the holding of the Crown land for a private purpose as they provide for remuneration to LLMP. As observed in several cases that is not conclusive that their principal purpose is private. In answering the third question of whether the purpose of the licences is private it is necessary to consider the licences separately given the differentiation between them identified in LLMP's submissions, particularly in relation to the first access licence. One question to be answered is whether the purpose of the licence is the kind of public purpose which the Crown ordinarily performs. Alternatively is the land held for the private purpose of building commercial buildings which are then leased for a profit or, as LLMP submitted at par 117 relying on Statewide at [118], should the licences be characterised as the government using the resources of the private sector in order to provide necessary public infrastructure which the government lacks the financial resources to provide. 144To consider some overarching submissions first, that the BDA has a project specific purpose as a public authority is not material and I do not consider that is a relevant distinction to be drawn with Landcom's commercial objectives in Rouse Hill. Indeed the other party to the deed in that case was a Minister of the Crown. In Garbett the agreement was with the DHA, also a public authority created to achieve a specific urban renewal development project close to the Sydney CBD and therefore similar to the BDA. That did not suggest to the Court of Appeal that the lease in question was not private. The same can be said here. That an entity of the Crown holds the Crown land to facilitate development is a neutral factor. 145That there is a high level of control by the BDA of the overall development process through the PDA as outlined in par 92 and 93 including the management committee as outlined in par 94 does not mean that the purpose of the licences is predominantly public, a conclusion also drawn in Rouse Hill where largely similar arrangements were considered by the Court. I also agree with and adopt the Council's submission in par 124 that the BDA Act does not confer on the BDA the power to undertake the construction of the commercial residential and tourist facilities the subject of the licences. Section 14(1)(a) of the BDA Act refers to promotion, facilitation, management of development of Barangaroo, to be contrasted with the provision which refers to the development of Headland Park in subsection (1)(c). 146LLMP's submissions seek to identify differences between the six licences particularly in relation to the access licences to support its case. Details of the licences are set out above at par 7-21. 147The third question is answered most readily in the Council's favour in relation to the three construction zone licences under which the extensive commercial building work the subject of the project approvals specified in the licences is to be carried out. The substantial part of that work is directed to the construction of the retail, residential and commercial buildings which dominate Barangaroo South. The C4 construction zone licence was granted on 6 July 2012 (par 12-13) and allows for the construction of commercial building C4 the subject of MP 10_0025 in the developer secured area. Exclusion of the Wynyard Walk temporary lands by the BDA from the land the subject of the licence was provided for. The BDA's permission was required to undertake works that may disrupt access and use of the foreshore pedestrian walkway. That LLMP does not have exclusive possession or occupation of the developer secured area and is not a tenant of the BDA does not change the dominance of LLMP's private purpose. 148The basement construction zone licence was also granted on 6 July 2012 pursuant to cl 13.1 of the PDA (par 14-16) allowing work the subject of MP 10_0023 to be done. This licence is in largely similar terms to the C4 construction zone licence, including in relation to the Wynyard Walk temporary lands and the foreshore pedestrian walkway. 149The C5 construction zone licence was granted on 9 November 2012 pursuant to cl 13.1 of the PDA and provides for the building of commercial building C5 in the developer secured area. Its terms are otherwise similar to the C4 construction zone licence (par 20-21). The dominant activity under these licences is the construction of residential, retail and commercial facilities, none of which are facilities the State Government would generally provide. This is not public infrastructure which the government is using the private sector to achieve, unlike the conclusion on the facts in Statewide. I do not accept LLMP's submission that any substantial profit or advantage was ancillary or incidental to the licence's public purpose citing Statewide at 118. The reasoning in Garbett and Rouse Hill which I consider applies results in the conclusion that the licences are for private purposes. As the Council's submissions identified, Priestley JA considered the project in Garbett involved a private sector project achieved with government encouragement provided by making available the necessary land. Further, the activities the subject of the licences are not ordinarily carried out by the Crown, the same conclusion reached in Rouse Hill in the passages from the judgment set out above. 150Whether the work preliminary to the work conducted under the construction zone licences is directed to the same private purpose arises in relation to the access licences. The first access licence dated 7 July 2010 to 6 July 2011 (par 7-9) allowed preliminary works in relation to MP 07_0077 being demolition of a number of structures on the site not limited to Barangaroo South, and in relation to MP 10_0023 permitted bulk excavation, remediation and construction of a basement car park. Some of the work was delayed pending the approval of a remediation plan by the Minister. Other preliminary work is set out at par 7(b)-(e) such as survey work and soil and archaeological investigations. Occupation of the land the subject of the licence under cl 3.1 was non-exclusive, BDA employees were to have access to the land, access to the foreshore pedestrian walkway required permission from the BDA. LLMP relied (par 109-110) on the affidavit evidence of Mr Biles, former project director for the stage 1 development, that construction work permitted under the licence in relation to two development approvals did not commence until mid 2011. 151The terms of the second access licence dated 21 July 2011 to 13 July 2012, Barangaroo stage 1 basement 1A works licence, were largely identical to the first access licence (par 10) with additional works being investigation works within the declaration area under MP10_0087 and piling and footings work under MP 10_0025 (building C4). Access to the BPL (Wynyard Walk area) by other contractors could be granted by the BDA (par 11). 152LLMP accepted (par 111) that demolition of a wharf and other lesser structures and investigation works undertaken were preliminary to the development of the rated land. 153The third access licence provided for preliminary work such as geotechnical and archaeological works permitted under the first and second access licences, and pilings and footings work for MP11_0044 (commercial tower C3) and MP10_0227 (commercial tower C5) during the licence period of 13 July 2012 to 14 July 2012. LLMP also submitted that remediation work the subject of the third access licence (par 112-113), which provided for preliminary works authorised by MP 10_0087 being a pilot trial for remediation were not for private purposes. The Director- General's environmental assessment report was relied on as stating that the purpose was to trial remediation methods to address contaminants in the soil within and outside the developer secured area. The declaration area (of contaminated land) was over part of the rated land and also outside it. The Council's response to LLMP's reliance on the remediation work is accepted. Remediation work conducted outside the rated land is irrelevant to the activities being conducted on the rated land, and that work conducted within the rated land is preliminary work to enable the later substantial commercial construction project. 154Contrary to LLMP's submissions I consider that the works under the second and third access licences were to assist future development of the private retail, residential and commercial development the subject of the three construction zone licences. As the Council identified that is consistent with reasoning in Garbett by Priestley JA at 297. The work conducted under the second access licence commenced in mid 2011 and included the footings for commercial building C4. Similarly the footings for commercial buildings C3 and C5 were authorised to be built under the third access licence. Additional preliminary work such as survey work and soil and archaeological investigations was undertaken under all three licences. 155While the first access licence was earlier in time, does not overlap with any of the construction zone licences and the construction contemplated under it did not occur according to Mr Biles' evidence there is no logical basis for distinguishing the nature of the preliminary work undertaken under that licence from the preliminary work undertaken under the second and third access licences. That work I have held was in pursuit of the private purpose clearly served by the three construction zone licences. I conclude that the access licences were also held for a private purpose. 156I agree with and adopt the Council's submissions on the appropriate application of Rouse Hill and why this matter is not relevantly different, at par 122-123. As the Council identified this case is stronger than in that case given that LLMP is able to enter into sub-leases for the commercial buildings directly with prospective tenants, further indication of the private purpose served by the licences.

Lend Lease (Millers Point) Pty Limited v Council of the City of Sydney

At a glance

Court

Decision date

Before

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Source

Catchwords

Judgment (31 paragraphs)

Parties

Legislation Cited (4)

Cases Cited (28)

Cited By (4)