Masterbuilt Pty Limited v Hornsby Shire Council

1. Following a hearing extending over five days in June 2002, the Senior Commissioner delivered a reserved judgment on 25 June 2002 whereby he determined an application for development consent to erect a housing project containing 22 dwellings for older people and people with a disability by granting consent subject to conditions.

2. Hornsby Shire Council ("the council") has lodged an appeal against the decision of the Senior Commissioner by way of notice of motion pursuant to s 56A of the Land and Environment Court Act 1979 ("the Court Act") on the following grounds:- 1.1 having found that there was a positive answer to one or more of the 8 parts of the test contained in section 5A of the Environmental Planning and Assessment Act 1979 ("the Act") he failed to find that the development application should have been accompanied by a Species Impact Statement prepared in accordance with division 2 of part 6 of the Threatened Species Conservation Act 1995 as required by Section 78A(8)(b) of the Act;

1.2 he attributed undue weight to the evidence of Mr O'Brien in preference to the evidence of Dr Clements specifically having regard to the respective qualifications and experience of both witnesses;

1.3 he failed to comprehend the use of the word "forest" in the description of the species "Blue Gum High Forest" and in doing so formed the view that in order for the species to be found on site there would need to be evidence of a "forest" as that word is understood in its ordinary meaning and in isolation;

1.4 he failed to apply the proper test required under clause 24 or SEPP5 and erred in holding that there was a proper site analysis accompanying the development application as required by that clause;

1.5 he found in paragraph 25 that it was "common ground" that the requirements of clause 24 of SEPP5 had been satisfied when there was in fact no such agreement.

Whether a Species Impact Statement was required by dint of s 78A(8)(b) of the Environmental Planning and Assessment Act 1979

Section 78A(8) of the Environmental Planning and Assessment Act 1979 ("the EP&A Act") provides that a development application must be accompanied by a Species Impact Statement ("SIS") prepared in accordance with Div 2 of Pt 6 of the Threatened Species Conservation Act 1995 ("the TSC Act") if the application is in respect of development on land that is, or is part of, critical habitat or is likely to significantly affect a threatened species population or ecological communities or their habitats. The Senior Commissioner found that while the site is generally covered by grass and weeds, it supports 18 trees around the edges, 16 of which are species belonging to the Blue Gum High Forest ecological community ("BGHF"). He also proceeded on the basis that the vegetation in the adjoining council reserve is BGHF.

During the course of submissions in the appeal Mr Graham, who appears for the council, re-phrased the issue to claim that the Senior Commissioner, having found a positive answer to one or more of the eight-part test in s 5A of the EP&A Act, was obliged to find that development was likely to significantly affect an ecological community, namely BGHF.

It is appropriate, therefore, to set out s 5A in full as follows:- Significant effect on threatened species, populations or ecological communities, or their habitats For the purposes of this Act and, in particular, in the administration of sections 78A, 79C (1) and 112, the following factors must be taken into account in deciding whether there is likely to be a significant effect on threatened species, populations or ecological communities, or their habitats: (a) in the case of a threatened species, whether the life cycle of the species is likely to be disrupted such that a viable local population of the species is likely to be placed at risk of extinction, (b) in the case of an endangered population, whether the life cycle of the species that constitutes the endangered population is likely to be disrupted such that the viability of the population is likely to be significantly compromised, (c) in relation to the regional distribution of the habitat of a threatened species, population or ecological community, whether a significant area of known habitat is to be modified or removed, (d) whether an area of known habitat is likely to become isolated from currently interconnecting or proximate areas of habitat for a threatened species, population or ecological community, (e) whether critical habitat will be affected, (f) whether a threatened species, population or ecological community, or their habitats, are adequately represented in conservation reserves (or other similar protected areas) in the region, (g) whether the development or activity proposed is of a class of development or activity that is recognised as a threatening process, (h) whether any threatened species, population or ecological community is at the limit of its known distribution.

It is apparent from the wording of the section that it is not prescriptive in the sense that any particular answer to one or more of the eight-part test must necessary lead to a particular conclusion for the purposes of s 78A(8)(b) of the TSC Act, namely that the development is likely to significantly affect an ecological community. Nevertheless, each one of the tests is couched in language that suggests that a particular response could indicate that the development will have serious consequences for the threatened species populations or ecological communities or their habitats. However, it has never been suggested that similar dictate like that previously contained in s 90 of the EP&A Act, namely that the consent authority "shall take into consideration" the matters that were set out in that section, could lead to an inevitable result.

The Senior Commissioner asked himself the correct question in par 14 of the judgment when he says where the application of the eight-part test leads to the conclusion that a proposed development is likely to significantly affect threatened species populations or ecological communities or their habitats a consent authority must not grant approval unless a SIS has been prepared. He then refers to the divergence of answers provided by the ecologist experts, particularly in their response to the criteria in par (c), (d) and (g) of s 5A.

Noting that the experts agreed that the answer to par (f) was "yes", that is, the BGHF is inadequately represented in other areas, the Senior Commissioner accepts that answer. Although one expert provided a positive answer in respect of par (g), the other expert was equivocal. The Senior Commissioner expresses an opinion that the activity ("the proposal") is clearly of a class that is recognised as a threatening process since "the activity is "development"". As is clear from the wording of par (g) itself, the Senior Commissioner correctly observes that this conclusion does not mean, however, "that all development is a threatening activity" .

Setting aside whether the issue raised by Mr Graham is merely one of fact, namely that the Senior Commissioner reached a particular conclusion open to him after the application of the eight-part test, there does not appear to be any error of law on his part in the process of determining that, in his opinion, the proposal is not likely to affect the endangered ecological community of BGHF on the council reserve. In so far as the site itself is concerned, the Senior Commissioner did not accept, as a question of fact, that there is BGHF on the site. Mr Graham raises the issue that the Senior Commissioner appears to have reached this conclusion from the appearance of the site. After stating that he did not accept that there is BGHF on the site, the Senior Commissioner indicated that he was "strengthened in this view by the appearance of the site" . Obviously the appearance of the site is not the only criteria taken into account by the Senior Commissioner. Moreover, he went on to say that if he was found to be wrong and the vegetation on the site is an example of the BGHF community, it would not alter his conclusion that a SIS is not required. Again, this, he says, is because the proposal is not a threatening activity and gives reasons for that conclusion.

The Court does not agree with the submission made by Mr Graham that as a consequence of the Senior Commissioner having found positive answers to one or more parts of the s 5A test, the only appropriate course was to find there was likely to be a significant affect on the ecological community BGHF.

The conclusion I have reached appears to be consistent with the reasons given by Lloyd J in Carstens v Pittwater Council (1999) 111 LGERA 1, particularly at p 22 where his Honour identified the critical question posed by s 78A(8)(b) in the same terms that I have referred to above and then rejects the ground of appeal that there was an error of law by failing to require a SIS when an affirmative answer had been given on the application of one of the tests set out in s 5A.

Nothing has been put by Mr Graham that persuades the Court that the attribution of undue weight to the evidence of one ecologist in preference to the evidence of the other is such that, even if it occurred, an error of law arises. Moreover, the Court has not been assisted by anything submitted on appeal to reach the conclusion that the Senior Commissioner fell into error by forming the view that in order for the species to be found on-site, there would need to be evidence of a "forest" as that word is understood in its ordinary meaning and in isolation. The Senior Commissioner provides reasons for his conclusion that there is no BGHF on the site. He was entitled to reach those conclusions on the basis of the evidence as a question of fact. However, whether or not the BGHF community existed on the site itself the Senior Commissioner was nonetheless satisfied that a SIS was not required.

The Court is not satisfied that the Senior Commissioner erred in law on any of the grounds, 1.1, 1.2 or 1.3.

Failure to comply with clause 24 of State Environmental Planning Policy No. 5

Clause 24 of State Environmental Planning Policy No. 5 - Housing for Older People or People with a Disability ("SEPP 5") contains the following provision:- Site analysis 24. (1) Consent must not be granted for development to which this Part applies unless the consent authority has taken into account a site analysis prepared by the applicant in accordance with this clause.

(a) contain information, where appropriate, about the site and its surrounds as described in Schedule 2 (Site analysis); and

(b) be accompanied by a written statement (that may be supported by drawings); (i) explaining how the design of the proposed development has regard to the site analysis; and (ii) explaining how the design of the proposed development has regard to the principles set out in clause 25.

At par 28 of his judgment the Senior Commissioner observes that it was common ground that the requirement in cl 24 for a written statement was satisfied. The council denies this. The Senior Commissioner concluded that the applicant's planning report satisfied the requirement for a written statement and identified the real point in dispute as being whether the proposal was different from that addressed by the site analysis. He concluded that the fact that the proposal turned out differently from that suggested in the early stages of design is of no consequence and that evolution of building shape is part of the normal development of architectural design. He did not accept that there was a legitimate issue raised under cl 24. On the basis explained by the Senior Commissioner, I agree.

Mr Graham's principle argument appears to be directed to a distinction between the Court and "the consent authority" referred to in cl 24 of SEPP 5.

In support of this proposition, he relies on observations made by Cowdroy AJ, as he then was, in Rosecorp Pty Ltd v Leichhardt Municipal Council (1999) 106 LGERA 1 at par 9 and in Gameplan Sports & Leisure Pty Limited v South Sydney City Council & Ors [2000] NSWLEC 112, unreported at par 26 as well as the comments made by Bignold J in Detala Pty Ltd v Byron Shire Council (No 1) (2000) 107 LGERA 385 at par 24.7, where submissions that the Court is the consent authority are rejected in the context of those respective cases. Bignold J was dealing with the impact of s 39(6) of the Court Act where a clear distinction is made for the purposes of that sub-section. Cowdroy AJ was dealing with the effect of the Heritage Act 1977 in Rosecorp.

The submission overlooks the impact of the provisions in s 39(2) of the Court Act whereby the Court shall have all the functions and discretions which the person or body whose decision is the subject of the appeal had in respect of the matter the subject of the appeal. The function of granting consent for development, to which Pt 3 of SEPP 5 applies, is clearly one of the functions of the council as consent authority which the Court has pursuant to s 39(2). That does not mean the Court becomes the consent authority. Section 39(2) has the effect that the Court may grant the consent pursuant to SEPP 5 only after it has taken into account a site analysis prepared by the applicant in accordance with cl 24.

It was, therefore, open for the Senior Commissioner to accept, as a question of fact, that the requirement in cl 24 for a written statement was satisfied. Not only was he satisfied in that respect, his conclusion was reinforced by the planning report submitted in evidence. The Court, having decided that cl 24 is not to be construed on the basis put by Mr Graham, namely that the written statement can only be made in a way that satisfies cl 24 by lodging it with the council, it was open for the applicant to satisfy the requirements of cl 24 prior to the Senior Commissioner making a final decision and for the Senior Commissioner to be satisfied, as a question of fact, in that respect.

In the circumstances, it is not necessary to raise other issues argued in relation to the effect of the failure to comply with cl 24, particularly as the appeal is against a deemed refusal of consent and generally.

The Court is not satisfied that there was any error of law by the Senior Commissioner as claimed in grounds 1.4 and 1.5 of the notice of motion.

It is the determination of the Court that the appeal be dismissed.

The council has been unsuccessful in its appeal and, accordingly, it is appropriate that, in the absence of any unusual circumstances, the Court exercises its discretion and makes an order that the appellant council pay the company's costs.

The Court makes the following formal orders:- (1) Appeal dismissed. (2) That the appellant council pay the costs of Masterbuilt Pty Limited as respondent to the appeal.

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