MM & SW Enterprises Pty Ltd v Strathfield Council

5 The applicant seeks a declaration that the premises have the benefit of existing use rights for the purpose of using the premises as a brothel. The central issue in this case is whether or not there are existing use rights that will protect the brothel upon the amendments to the Strathfield Planning Scheme Ordinance 1969 ("the Ordinance") by Strathfield Local Environmental Plan 82 ("LEP 82") being gazetted on 21 November 1997. Upon the gazettal of LEP 82 brothel use became prohibited in the Special Use 3(b) zone, the zone in which the premises are located. The applicant argues that the premises have been used continuously as a brothel since the Council granted consent to the use of the property for "commercial offices" on 12 August 1980. 6 To be successful the applicant must demonstrate, first, that the use of the premises was for a lawful purpose immediately before the coming into force of the environmental planning instrument having the effect of prohibiting that use (s 106(a) of the EPAA). Accordingly, the applicant must show that the use of the premises as a brothel as at 21 November 1997 when LEP 82 was gazetted, was for a lawful purpose. Second, the applicant must demonstrate that the use has continued since that time.

7 This gives rise to a question of construction, namely, whether or not the term "commercial offices" contained in the development consent contemplates the premises being used as a business supplying sexual services, and if so, whether or not the premises have been occupied as such a business immediately prior to the amendment of the Ordinance that prohibited its existence on 21 November 1997. 8 The parties agreed that the relevant dates for the purposes of determining whether there was an existing lawful use on the premises was 21 November 1997. This was because prior to this date, there was no definition of "brothel" in the Ordinance and there was no prohibition on brothel use in the Special Use 3(b) zone.

Summary of Decision 9 For the reasons set out below I find that the term "commercial offices" as contained in the development consent does not include the use of the premises as a brothel. Accordingly, there being no lawful use of the premises as a brothel prior to that use being rendered unlawful in November 1997 (even though I have found that the premises were being used for that purpose at that time), the applicant cannot take the benefit of any existing use rights. I therefore decline to make the declaration sought.

Zoning of Premises 10 A development application for the use of the premises for commercial offices was approved by the Council subject to conditions and issued on 14 August 1980, operative as at 12 August 1980. At the time of the approval, the premises were zoned Special Use 3(b) under the Ordinance and no definition of "brothel" was contained in it. It was not until the Ordinance was amended on 21 November 1997 that the use of the premises as a brothel became prohibited.

11 On 4 February 2000, Strathfield Local Environmental Plan 79 ("LEP 79") was gazetted which inserted into the Ordinance the Mixed Use 10 zone. The premises had been rezoned by LEP 79 to Mixed Use 10. At the time of the gazettal of the LEP, brothels were a prohibited use in the Mixed Use 10 zone. The premises are currently zoned Mixed Use 10 under the Ordinance.

Relevant Planning Instruments 12 In 1969 when the Ordinance was initially gazetted, it did not contemplate, define or prohibit the existence of brothels. While brothels were prohibited by general operation of the criminal law they were 'lawful' under planning law (Sydney City Council v Ke-Su Investments Pty Ltd (No 2) (1983) 51 LGRA 186 at 203 citing Northern Territory Planning Authority v Murray Meats NT Pty Ltd (1983) 51 LGRA 158 and Lizzio v The Council of the Municipality of Ryde (1983) 155 CLR 211). 13 The Ordinance did not define the term "commercial offices" but it did define the term "commercial premises" as (emphasis added): a building or place used or intended to be used as an office or for other business or commercial purposes , but does not include a building or place elsewhere specifically defined in this clause or a building or place used or intended to be used for a purpose elsewhere specifically defined in this clause or for a roadside stall. 14 The premises were located in the Special Business 3(b) zone that primarily included car repair stations, commercial premises, hotels, integrated housing and single dwellings used in conjunction with commercial premises. 15 In 1995 the Disorderly Houses Amendment Act 1995 legalised brothels in New South Wales. That Act also amended the Crimes Act 1990, abolishing the common law offence of keeping a brothel and other related offences. 16 With the advent of these statutory reforms, brothels became lawful commercial land uses regulated through environmental planning instruments requiring council approval under the EPAA (see the New South Wales Legislative Assembly, Disorderly Houses Amendment (Brothels) Bill, Second Reading speech, (Hansard), 30 November 2009, at 19295). 17 The Ordinance was amended by LEP 82 on 21 November 1997 to include the definition of "brothel" as a "premises used for the purposes of prostitution by one or more prostitutes". LEP 82 introduced a prohibition against the use of brothels in Special Use 3(b) zone. 18 On 4 February 2000, the Strathfield Local Environmental Plan 79 ("LEP 79") was gazetted and inserted into the Ordinance a new zone called Mixed Use 10 zone. At the same time the premises were rezoned by LEP 79 to Mixed Use 10. Brothels at the time of the gazettal of LEP 79 were (and still are) a prohibited use in the Mixed Use 10 zone.

19 Thus since 21 November 1997 the use of the premises as a brothel has been prohibited under the relevant planning instruments. Statutory Framework 20 The EPAA sets out the definition of existing use rights under Pt 4 Div 10. Section 106 states: 106 Definition of "existing use" In this Division, existing use means: (a) the use of a building, work or land for a lawful purpose immediately before the coming into force of an environmental planning instrument which would, but for Division 4A of Part 3 or Division 4 of this Part, have the effect of prohibiting that use, and (b) the use of a building, work or land: (i) for which development consent was granted before the commencement of a provision of an environmental planning instrument having the effect of prohibiting the use, and (ii) that has been carried out, within one year after the date on which that provision commenced, in accordance with the terms of the consent and to such an extent as to ensure (apart from that provision) that the development consent would not lapse. 21 Section 107 of the EPAA relevantly states: 107 Continuance of and limitations on existing use (1) Except where expressly provided in this Act, nothing in this Act or an environmental planning instrument prevents the continuance of an existing use. (2) Nothing in subsection (1) authorises: … (e) the continuance of the use therein mentioned where that use is abandoned. (3) Without limiting the generality of subsection (2) (e), a use is to be presumed, unless the contrary is established, to be abandoned if it ceases to be actually so used for a continuous period of 12 months. Evidence

22 The applicant relied on the affidavit of Ms Julie Bates sworn 9 March 2009. Ms Bates deposed that MM&SW own and conduct a sex services business at the premises and have done so for the past eight years. MM&SW lease the premises from the owner, Lahood.

23 Ms Bates further stated that she was informed by the Council that it was unable to locate documents relating to the premises for the 1979 and 1980 period.

24 The applicant tendered a number of documents from the Council file which related to the use of the premises from 1980 to 2004. The documents were not complete and a continuous historical record of the use and occupation of the premises was unavailable.

25 The Council relied on documents annexed to the affidavit of Mr Jason Wong sworn 26 March 2009. Mr Wong, a town planner employed by the Council, deposed to the consent history of the premises and provided evidence of the applicable planning instruments governing its zoning and use.

26 Mr Wong was cross examined by the applicant and he conceded that, first, the documents on the Council file relating to the premises indicated that from time to time since 1980 it had been used as a brothel, and that second, he did not recall seeing any advertisements on the file which indicated its use as a sex on premises venue.

27 After the respondent's evidence had closed, the applicant sought leave to reopen its case to call Mr David Lahood of Lahood to give oral evidence as to the ongoing use of the premises as a brothel (the applicant had earlier sought leave to tender an unsworn statement of Mr Lahood which was opposed by the Council and rejected by me). The application was opposed by the Council on the basis of the inadequate notice given of it and because, it was submitted, it would cause prejudice to the Council who would require documentary material (such as leases) to properly cross examine Mr Lahood. I agreed and the application was refused. Factual Background and Chronology of the Use of the Premises 28 Subject to one area of dispute, the facts giving rise to this application as evidenced by the Council documents and the documents annexed or exhibited to Ms Bates' and Mr Wong's affidavits were largely uncontested.

29 In 1965 the Council authorised the premises to be used as a car yard.

30 On 18 April 1980, a letter from the Assistant Commissioner of Police to the Council indicated that Mrs Dee, the lessee of the premises had operated a escort agency from the premises from 1 July 1979.

31 On 5 July 1980, a development application was lodged by Mr Rowe in respect of the premises to erect partitions, build toilets and change the use from class VI to class V. The present use of the premises was listed as "car sales yard". The total number of employees proposed was six males and three females.

32 Then on 7 July 1980, a development application was made to the Council for alteration to the internal layout of the top floor of the premises' building at Rear No 131A Parramatta Road, Homebush. The proposal stated that "this section of the premises will be used as a large general office, five separate partitioned offices, stationery and tea-room and foyer." The plans attached to the development application showed an existing car sales yard on the ground floor and offices and two toilets on the first floor. The proposed working times were 8.00am to 6.00pm Monday to Friday and 8.00am to 1.00pm on Saturdays. The applicant did not specify on its application the use to which the premises were to be put. However, a later letter attaching a sketch plan was sent to the Council from the architect stating the premises' intended occupancies as follows: I attach sketch plans of proposed alterations to the above premises to permit use as commercial premises whereas the precise end use of these premises is not yet known, development consent is sought to cover the following occupancies: 1 professional offices, 2 finance company, 3 offices relating to car sales or dealing 33 The sketch plans showed four office spaces, a sales room, a storeroom, a stationery room, a tearoom, bathrooms and a foyer. 34 On 14 July 1980, the Council approved the development application for the use of the premises as "commercial offices" subject to conditions ("the development consent"). 35 The certificate of consent issued 14 August 1980 (but operative as at 12 August 1980) stated (emphasis added): The Council of the Municipality of Strathfield as the Responsible Authority herein hereby grants its consent to the use of the property described above for commercial offices subject to the following conditions: - 1. No injury being caused to the amenity of the neighbourhood due to the creation of a traffic hazard or congestion or otherwise. 2. Three off-street car parking spaces being provided on the site to Council's standards in accordance with a further plan to be submitted for approval of Council, prior to release of the building plans, such spaces being properly line-marked, drained and maintained to Council's satisfaction.

No section of the premises being used for the purpose of a Doctors' nor Dentists' surgery.

No part of the premises being used for residential habitation at any time.

The hours of operation being restricted to between 8 am and 6 pm Mondays to Fridays and between 8 am and 1 pm Saturdays.

Not more than nine persons being employed on the premises at any one time without further approval of Council.

The wall separating the existing motor show-room from the proposed office section of the premises being provided with a fire rating of not less than two hours in accordance with provisions of Ordinance 70.

The openings in the northern wall of the building being properly protected in accordance with the provisions of Part 22.4 of Ordinance 70.

The openings in the eastern wall of the building being limited to that within the terms of Part 22.5 of Ordinance 70. 36 The term "commercial offices" was not defined in either the consent or the Ordinance. Similarly, as stated above, no definition of the term "brothel" was contained in either instrument.

37 On 15 September 1980, approval was granted to Mr Rowe for an internal conversion of the showroom to offices.

38 On 5 January 1984, the Council wrote to Mr Rowe reminding him of an undertaking given by him "to have this unauthorised use terminated" and reminding him that the premises could only be used for "commercial offices". The Council file does not reveal what this unauthorised use was.

39 On 18 February 1985, the Council wrote to "The Manager, Cur Mac Auto Repairs" and notified him of a number of complaints received about the hours of operation in breach of the conditions of consent.

40 On 9 September 1986, a motion was put forward by the Council to investigate the use of the premises as, I infer, an escort agency in light of the contents of an advertisement appearing in The Glebe which indicated that the premises were being used for this purpose.

41 On 4 November 1986, the Council received advice from the owner's solicitors that the tenants of the premises had been evicted. The Council undertook preliminary checks and surveillance of the premises and were satisfied that activity and brothel use had ceased. 42 New tenants, Launchpad Productions, took possession of the premises and the Council again engaged private investigators to survey the premises. The surveillance revealed that the use of the premises as a brothel had stopped.

43 On 14 November 1986, Launchpad Productions wrote to the Council enclosing a letter from Mr Rowe authorising an application for an amendment to the existing consent to use the premises as a residential flat in conjunction with commercial premises. The plans attached showed two bedrooms, a "lounge and bar", a "sewing room", "breakfast nook" and the "existing office/store area".

44 The Council responded to the letter on 9 December 1986, requesting further information on why a caretakers flat was necessary.

45 On 14 April 1987, a Contravention Notice was issued by the Council to the owner on the basis that the premises were being used as a brothel contrary to its development consent.

46 In April, May and June 1987, a series of ads appeared in The Western Suburbs Courier and The Glebe for use of the premises as a brothel.

47 On 18 July 1987, the property was inspected by the Council and it appeared that the premises were once again being used as a brothel.

48 On 13 August 1987, the property was again re-inspected and a cleaner told the Council that the premises' hours of operation were 2 pm to 2 am.

49 Further correspondence passed between the Council and Launchpad Productions and on 5 January 1988, Launchpad Productions wrote to the Council stating that "it has never had any connection or relationship with prior tenants, and naturally enough cannot be responsible for any contravention of the development consent prior occupants may have committed." It stated that it intended to sublet the various offices and that the number of people employed on the premises at any one time would not exceed three.

50 However, as at 3 February 1988, the Council was of the opinion that the use of the premises as a brothel continued and further surveillance of the property was carried out.

51 In early February 1988, the police investigated the use of the premises as a brothel. The police informed the Council that the person signing as Ms Jennifer Barlow on behalf of Launchpad Productions was also known as "Catherine Mailey" and "Christine Blake".

52 On 27 May 1988, the report of the investigator engaged by the Council to carry out surveillance confirmed the Council's belief that the premises were being used for the purpose of prostitution and not commercial offices. 53 The applicant tendered copies of newspaper and telephone book advertisements for "Golden Girls" contained in the Council's files to confirm use of the premises as a brothel in 1990 and 1991. I accept that in these years, the inference to be drawn from this documentary material is that the premises were being used as a brothel.

54 On 31 July 1991, a lease was signed between Mr Rowe, as lessor, and Ms Barlow, as lessee, in respect of the premises for a period of four years.

55 On 8 July 1992, the Council again requested that surveillance take place as to the use to which the premises were being put, the Council suspecting that the premises were still being utilised as a brothel.

56 From 1991 to 2003, there exists limited evidence as to the use to which the premises were put.

57 However, on 23 February 1996, a s 149 certificate providing information as to the matters affecting the land was issued to "Cathy Blake" at "91 Park Road Homebush NSW".

58 On 20 October 1999, a letter was written to the Council from Mr Chris Oliver the director of Optima Developments Pty Ltd in respect of "131A Parramatta Road Homebush" which made reference to the Disorderly Houses Amendment Act and notes that Optima Development's client commenced occupation of the ground floor of the existing commercial premises in early 1997 after the vacation of the tenant. The letter stated that after the commencement of the Disorderly Houses Amendment Act its client "began to investigate more suitable premises as it was obvious the adjoining residential zoning and development would become a constraint to the long term continued use of the ground floor." The letter went on to advise that its client had found alternative premises in April 1997, and therefore, it was the client's intention to cease use of the ground floor and remove all unauthorised work.

59 The premises were purchased from Mr Rowe by Lahood in or about August of 2003. Prior to the purchase Lahood wrote to the Council on several occasions asking whether or not the development consent had been obtained by the Council for the use of the property as a car yard. This was tentatively confirmed by the Council on 26 August 2003. 60 In October 2003, the current owner of the premises, Mr David Lahood of Lahood, enquired to the Council by telephone whether the premises had any approval to be used as a brothel. During the telephone conversation it was alleged that Mr Lahood stated that such use "had been carried out within the last 25 years or so".

61 The Council responded by letter dated 27 October 2003, stating that consent for such use was required and that "records held at Council cannot confirm that a brothel has been approved". In relation to "No. 91 Wentworth Road Homebush" the Council noted that this was not shown as a separate rateable address and was in fact situated at the rear of 131A Parramatta Road. The Council further advised that while the approved use, "commercial premises", referred to activities associated with the approved car yard, no approval existed for use as a brothel. The letter went on to state that: Since then, investigations were carried out regarding an alleged brothel operating from what was known as 91 Park Road. Council's records show that after many years, the alleged brothel ceased operation and no longer operates.

62 On 22 January 2004, Ms Catherine O'Malley wrote to the Council stating that she had been a tenant of the premises until 27 May 2003 at which time "the premises were closed as a brothel".

63 On 6 November 2008, the Council served the owner of the premises with the Brothel Closure Order. 64 On 22 January 2009, the Council wrote to the applicant's legal representatives stating that they did not accept the applicant's claim for existing use rights and advised that the time for compliance with the Brothel Closure Order had lapsed and that it was the Council's intention to apply for a Utilities Order against the premises under s 121ZS of the EPAA.

65 The applicant subsequently commenced Class 4 proceedings in this Court.

Applicant's Submissions 66 The applicant's argument may be summarised as follows, namely, that the 1980 consent for "commercial offices" provided a basis for the use of the premises as a brothel. As the term "brothel" was not defined in the Ordinance until November 1997, and was not prohibited until 2000, the use was permissible with consent under the 1980 consent and there had been no abandonment of the use.

67 The applicant submitted that since the enactment of the Disorderly Houses Amendment Act in 1995, it was Parliament's intention for brothels to be considered commercial businesses that required council approval, approval which, the applicant argued, it had in the form of the 1980 consent. 68 The applicant argued that the brothel was a "commercial premises" in fact and for the purposes of the Ordinance. The development consent was granted for use as "commercial offices", which was simply a descriptive characteristic of "commercial premises" within the Ordinance. Put another way, the term "commercial premises" was a catch-all phrase subsuming "commercial offices", businesses and places or buildings used for commercial purposes as defined in the Ordinance. A brothel was a business and/or a place or building used for commercial purposes. Thus both terms came within the definition of "commercial premises" and were therefore lawful purposes under the Ordinance.

69 The applicant also submitted that the classification of an existing use right was to be determined by consideration of the context in which the classification is made, rather than adopting a narrow definition of "commercial offices" restricting the use only to precise activities. "Commercial offices" was not defined in the relevant planning instrument and thus was free of limitation or restriction, allowing it to be liberally construed as broadly as the language and its context permitted. 70 The applicant cited the following passage from Shire of Perth v O'Keefe (1964) 110 CLR 529 per Kitto J (at 535) to provide guidance as to how an existing use was to be construed: First it is required that a purpose be identified as the end for which it can be seen that the premises are being used at the date of gazettal of the by-laws. Then the provision is made that the land may continue to be used for that purpose: not that the precise manner of use for that purpose may alone continue but that use generally for that purpose may continue. The application of the by-law in a particular case has therefore not to be approached through a meticulous examination of the details of processes or activities, or through a precise cataloguing of individual items of goods dealt in, but by asking what, according to ordinary terminology, is the appropriate designation of the purpose being served by the use of the premises at the material date. … If premises were being used as professional offices at the commencement of the by-laws, no greater degree of particularity in defining the purpose is likely to appeal to practical minds as appropriate in the application of town-planning legislation than is involved in saying that the purpose is that of professional offices: the particular profession of the occupant would not ordinarily be adverted to by a person speaking in a town-planning context. 71 Thus consistent with O'Keefe, it was not necessary to ascertain what the precise use of the "commercial offices" were for, but for the offices to be accepted as a "room or place for the transaction of business" and for "business" to be widely construed as including the provision of sexual services for reward. As long as the use was for a commercial purpose, it was a lawful purpose. 72 This, the applicant contended, was consistent with construing "commercial offices" according to its ordinary meaning. The applicant referred the Court to The Macquarie Dictionary definitions (on-line) of "business" and "office". The definition of "office" was "a room or place for the transaction of business, the discharge of professional duties, or the like". The word "business" was defined as "one's occupation, profession or trade" and as "a person, partnership, or corporation engaged in business; an established or going enterprise or concern". Therefore, a brothel was no more than a place where business was engaged in. Moreover, the offering of sexual services for reward was clearly a business. The building was therefore being used for a lawful purpose before the coming into effect of the relevant planning instrument prohibiting its use. Accordingly, the applicant could take the benefit of existing use rights.

Respondent's Submissions 73 The respondent's submissions may be summarised as two-fold: first, that as a matter of law, the use of the building immediately before 21 November 1997 when LEP 82 was gazetted was not, as a brothel, for a lawful purpose, and second, even if it was, that as a matter of fact the applicant had failed to demonstrate that the use had continued since that time to the present.

74 In relation to the first limb of the respondent's submissions, the respondent contended that the correct approach was to look at the ambit of the 1980 consent to determine whether use as a brothel was lawful. Further, the consent was to be construed in a manner which did not require the application of specialist terminology. The respondent relied on The Macquarie Dictionary (3rd ed) definition of "office" that described an office as "a room or place for the transaction of business, the discharge of professional duties or the like: the solicitor's office" or "the room or rooms in which the clerical work of an industrial or other establishment is done" or "a room assigned to a specific person or group of persons in a commercial or industrial organisation". The same dictionary defined the word "commercial" as "of or of the nature of commerce, engaged in commerce".

75 The respondent therefore argued that the use of the premises as a house of prostitution, notwithstanding that there may be an "office" within such an establishment, was not as "commercial offices" as that term was ordinarily used. This conclusion, the respondent submitted, was reinforced by condition 3 of the consent.

76 The respondent further submitted that even if, which it was not, it was open to approach the matter on the basis of the genus test, it could not be said that the genus was "commercial premises". Such a characterisation would be to extend existing use rights to a wide variety of uses beyond the ambit of the development consent. Rather, the approved use was for use as "commercial offices" which was more restrictive in scope.

77 In addition, when regard was had to the plan of the premises it was clear that it was of a general office building. The plan showed office spaces, bathrooms, a storeroom, a stationery resource room, a tearoom and a sales room. The plan depicted large windows facing the street. These architectural attributes were not indicative of a brothel, but were indicative of a general administrative office.

78 With respect to the second limb of the respondent's submissions, the respondent contended that the applicant had not established that use of the premises as a brothel had continued in the required sense. Nowhere had it been established that the use of the premises as at 21 November 1997 was as a brothel. In order to demonstrate that the use continued over time, leases ought to have been tendered, and evidence from previous tenants or other witnesses should have given as to its use as a brothel. This had not been done and most of the evidence put before the Court was prior to 1997. The absence of any direct evidence as to the use of the subject premises in 1997 meant that the onus had not been discharged by the applicant and the Court could not find that existing use rights were in existence at the critical time.

Consideration No Lawful Use 79 To establish an existing use right, the applicant must establish on the facts that the use was lawful and was not a prohibited use in existence immediately prior to the commencement of the relevant planning instrument that proscribed the use (s 106 of the EPAA). 80 The term "lawful" in ss 106 and 107 means not prohibited by planning law (Sydney City Council v Ke-Su Investments Pty Ltd (No 2) (1983) 51 LGRA 186 at 203-204). 81 In circumstances where premises are subject to a development consent, the terms of the consent become the "lawful purpose" from which an existing use can arise pursuant to s 106(b)(i) of the EPAA (Botany Bay City Council v Workmate Abrasives Pty Ltd (2004) 138 LGERA 120 at [12]-[14] and House of Peace Pty Ltd v Bankstown City Council (2000) 48 NSWLR 498 at [36]-[37]). 82 Only the "lawful purpose", that is, the terms and conditions stipulated in the development consent, can be relied upon by the applicant to secure existing use rights. Any other "use" - such as an unlawful use or an actual use that is different from the consenting use - is not a lawful use, and cannot be relied upon to gain existing use rights (Fatsel Pty Ltd v ACR Trading Pty Ltd [No 3] (1987) 64 LGRA 177 at 190). 83 In order to determine what the lawful purpose is, the Court must look to the ambit of the language in the development consent to determine whether the use is lawful under planning law and therefore protected. 84 The principles relating to characterization of the purpose were recently usefully collated by Biscoe J in Warlam Pty Ltd v Marrickville Council (2009) 165 LGERA 184 (at [17]-[19]): [17] Characterisation of the purpose of an existing use and the purpose of a proposed use are governed by the principles reviewed by the Court of Appeal in Royal Agricultural Society (NSW) v Sydney City Council (1987) 61 LGRA 305 at 309-311 and Grace v Thomas Street Café Pty Ltd (2007) 159 LGERA 57 at [56]-[69]. The leading High Court Decision is Shire of Perth v O'Keefe (1964) 110 CLR 529, 10 LGRA 147 (followed by the High Court in Woollahra Municipal Council v Banool Developments Pty Ltd (1973) 129 CLR 138 at 145-146, 28 LGRA 410 at 416-417, Pioneer Concrete (Qld) Pty Ltd v Brisbane City Council (1980) 145 CLR 485, 44 LGRA 346 and Dorrestijn v SA Planning Commission (1984) 59 ALJR 105, 54 LGRA 99). Other leading Court of Appeal decisions include North Sydney Municipal Council v Boyts Radio & Electrical Pty Ltd (1989) 16 NSWLR 50, 67 LGRA 344, North Sydney Municipal Council v Sydney Serviced Apartments Pty Ltd (1990) 21 NSWLR 532 at 535, 71 LGRA 432 at 435, and Woollahra Municipal Council v Minister for Environment (1991) 23 NSWLR 710 , 73 LGRA 379. [18] I would summarise the existing use principles, so far as may be relevant, as follows: (a) existing use provisions in planning legislation are designed to permit continuation of a use of land for the purpose for which it was used immediately before later regulation that prohibited it wholly or partly or upon conditions. The rationale is that it is unjust to deprive an owner of the right to use land for an existing purpose: Royal at 309; Grace at [56]; (b) accordingly, existing use provisions should be as liberally construed as the language in its context allows: Dorrestijn at 108; 105; Grace at [67]; (c) in order to reconcile the right of the owner to use land for an existing purpose with the right of the local authority to enforce the conflicting objectives of planning legislation, the courts refuse to categorise the purpose of an existing use so narrowly that natural changes in the method of using land or carrying on a business or industry will render an existing use right valueless. Likewise, the courts refuse to categorise the purpose of an existing use so widely that land or premises could be used for a prohibited purpose that was not part of its use at the time of commencement of the prohibiting regulation. Accordingly, a test has been devised which requires characterisation of the purpose of the land to be described only at that level of generality which is necessary and sufficient to cover the individual activities, transactions or processes carried on at the relevant date. The test is not so narrow that it requires characterisation of purpose in terms of the detailed activities, transactions or processes which have taken place. The test is not so general that the characterisation can embrace activities, transactions or processes which differ in kind from the use which the activities etc, as a class have made of the land: Royal at 309-310; (d) a statement of the purpose for which land is being used is a description or characterisation of what is being done with or upon the land, not an account of the motives of the persons involved in that activity: Shire of Perth at 534; 150. Royal at 311, Woollahra Municipal Council v Minister for Environment at 714; 382; (e) land may be used for more than one purpose. If activities, processes or transactions are capable of being treated as all or the majority of the species of a genus, then the genus may properly be regarded as describing the purpose of the use. If they are not, then the only conclusion may be that the land has been used for more than one purpose: Royal at 311; Grace at [59]; (f) the task is always to categorise the purpose (or each purpose) to which premises have been put: Grace at [60]; (g) that involves an inquiry into what, according to ordinary terminology, is the appropriate categorisation of the purpose of the use. A useful criterion to apply is that which would appeal to practical minds as appropriate in the context of town planning legislation: Shire of Perth at 535; 150-151; Pioneer at 507-508; 362; (h) in determining whether a use is protected by existing use provisions, there are two distinct steps. First, identify the purpose for which land was being used as at the date of the later planning regulation which prohibited that use. The land may continue to be used for that purpose. Secondly, identify whether the use of the land thereafter is generally for the same purpose: Royal at 311; (i) the design or form of a building is not determinative of its use. For example, a building might be constructed of units which are capable of residential use. But if the units are used for professional offices, the use would not be a residential flat building: North Sydney Municipal Council v Sydney Serviced Apartments at 535; 435; (j) categorisation of uses is a matter of fact and degree and borderline cases will inevitably arise: Shire of Perth at 535; 150; (k) a use can naturally evolve over time and changes in the method of operation of a particular category of use will not deny existing use rights: Grace at [60]. [19] The following characterisations of uses are illustrative. The use of premises for pottery making was not categorised more generally as a use for the purpose of light industry: Shire of Perth v O'Keefe . The use of premises for professional offices need not ordinarily be categorised with greater particularity (such as by reference to the particular profession): Shire of Perth at 535; 150. The general term "shop" is an insufficient description of a purpose. Thus, premises used as a butcher's shop were not properly to be categorised more generally as a shop: Shire of Perth at 535; 150. Similarly, premises used as a retail food shop were not to be categorised more generally as a neighbourhood village retail shop: Woollahra Municipal Council v Banool Developments . The use of the Sydney showground was for the purposes of a showground and speedway and could not properly be described as for the purpose of open air concerts, notwithstanding that five concerts had been held there over 25 years: Royal at 312. Premises which warehoused electrical goods and other goods were categorised as a warehouse, notwithstanding that that would permit the storage of goods not previously stored: North Sydney Municipal Council v Boyts Radio at 61; 354. Premises used as a milk bar with takeaway food were not classified as a café or refreshment room: Grace .

85 To this summary I would add the statement in T & K Berry v Wollongong Council [2008] NSWLEC 210 per Jagot J (at [34], emphasis added), that "whether a place is being used as a manager's residence or not, as with all questions of the purpose of a use, will depend on a common sense assessment of the character, extent, and features of the various uses and the ends they apparently serve".

86 In short, "ultimately, the search is for what, objectively determined, it might be said the Council meant by the permission which it gave to the [applicant's] predecessor" (Fatsel at 188). There must therefore be an examination of the facts of the case and a "fair but liberal" (House of Peace at [41]) examination of the development consent as a whole.

Genus Test 87 In characterising whether a use approved by a development consent is lawful, Stein AJA in Workmate Abrasives (at [14]) (with whom Spigelman CJ and Cripps J agreed) stated "in my opinion, counsel for the appellant is correct to suggest that the [genus] test is irrelevant to a situation where the existing use is claimed to flow from an existing development consent. The genus test would be relevant for characterisation, if there was no consent, but there was in this case." In the present case, the existing use flows from the 1980 consent because the applicant contends that a brothel is a "commercial office" for which use was approved. The genus test is therefore irrelevant (Botany Bay City Council v Parangool Ptyl Ltd [2009] NSWLEC 198 at [13]-[16]).

88 However, even if it was open to approach the matter on the basis of the genus test, I accept the submission of the respondent that it cannot be said that the genus is the description of "commercial premises" contained in the Ordinance. Such a characterisation is overly generous. To subsume a commercial office use under the head of commercial premises would extend existing use rights to a variety of multifarious uses (Strathfield Municipal Council v Australian Centre for Languages Pty Ltd (1991) 74 LGRA 117).

89 As Stein AJA stated in Workmate Abrasives (at [15]-[16]): [15] However, even assuming that it was open to the Court to approach the matter on the basis of the genus test, it seems to me that his Honour was in error in his conclusion, Applying, as his Honour purported to do, the words of McHugh JA in the Royal Agricultural Society (NSW) v Sydney City Council (1987) 61 LGRA 305 at 309, it cannot be said that the genus is light industry, and that the use of steel fabrication was for purposes of light industry.

[16] The words used by McHugh JA in the passage to which I have referred in the RAS case are clear. By no means, even giving a broad construction to existing use provisions, can it be said that the use under the 1974 consent and the use for steel fabrication are of the same category of light industry. The characterization at such a level of generality is in error. Indeed, it is striking that such an argument in relation to light industry was rejected in the seminal case on existing uses of the Shire of Perth v O'Keefe (1964) 110 CLR 529, 10 LGRA 147. Pottery was not light industry. 90 Similarly in the present case it cannot be said that the use of the premises as a brothel is a use of the premises as "commercial offices", irrespective of whether or not a brothel is, which I accept for the reasons below, a business (Hope v Bathurst City Council (1978) 38 LGRA 1 at 5).

91 Accordingly, the applicant must demonstrate that the ordinary meaning of "commercial offices" can be characterised to include a brothel (s 106(b)(i) of the EPAA). Without this construction the usage cannot be considered to be a lawful purpose in accordance with the consent and the usage as a brothel cannot take the benefit of existing use rights.

Construction of the 1980 Development Consent Does Not Support the Use as a Brothel

92 When regard is had to both the individual conditions of the development consent and the consent read as a whole, it is clear that the consent contemplates use of the premises as a general administrative office and not as a brothel. For example, the development consent stated that the hours of operation were restricted to "between 8 am and 6 pm Mondays to Fridays and between 8 am and 1 pm Saturdays." These hours typically reflect the working hours of an administrative or retail business operating at the premises.

93 Furthermore, there are no conditions contained in the consent which are peculiar to the conduct of a business providing sexual services, such as 24 hour or late night opening hours (see, for example, Walsh v Bankstown City Council (1997) 96 LGERA 62). The specific conditions that were contained in the consent were referable to the nominated use of the premises in the development application, namely, as a car sales yard with offices relating to this activity (see, for example, condition 7).

94 Condition 3 of the consent also militates against the use of the premises as a brothel. If use of the premises to provide health services to persons (that is to say, use "for the purpose of a Doctors' nor Dentists' surgery") was specifically excluded from the consent then it is even more remote, in my view, that use of the premises to provide sexual services to persons, even if for reward, was within the ambit of the consent. Rather, the condition reinforces that what the consent contemplates is a commercial business of a significantly more clerical or administrative nature.

95 This conclusion is corroborated by the fact that what was sought in the development application was precisely what was granted, namely, use of the premises as an office associated with a car yard, not use of the premises as a brothel.

96 In Walsh (relied upon by the applicant) the issue was whether a proposed development to use the premises as a brothel constituted a use within the description of "commercial premises" as defined in the relevant instrument prohibiting the use. In that case Bankstown Council had refused a development application seeking the use of premises as a brothel. The Bankstown Planning Scheme Ordinance ("the Bankstown PSO") did not define the term "brothel" but did define the term "commercial premises" in a manner that was relevantly identical to that contained in the Ordinance the subject of these proceedings (only the words "or intended to be used" were omitted). Cowdroy AJ in Walsh stated (at 64): The definition contained in the Ordinance merely requires that a building or place be used "as an office or for other business" in order to qualify for the definition of "commercial premises". It does not have to be for "commercial purposes" to qualify as "commercial premises". So considered, the proposed use of the subject building is for a business. 97 His Honour held that a brothel was a "commercial premises". In so doing he stated that "even though the term ["brothel"] is not defined it does not follow that the character of the activity cannot be described as a 'business' or 'commercial' for the purpose of its classification" (at 64). 98 Applying this reasoning, which I accept as correct, I find that a brothel is a business inasmuch as it provides a service for reward and may require office rooms to assist in the administration of that business. On this basis, it may be described as "commercial premises".

99 However, this is not the end of the matter. In the present proceedings, the development consent approves use of the premises more narrowly than that in Walsh, namely, consent is given for use of the premises as "commercial offices" and not merely for "commercial premises", or for a "commercial purpose". Given its specificity, the ambit of the proper construction of the term "commercial offices" requires further examination. 100 The definition of the term "commercial offices" was the subject of the decision in Bird v Hawkesbury City Council (2000) 106 LGERA 224. In that case the applicant sought development consent for the use of a building as a brothel. The overseeing planning instrument was the Hawkesbury Local Environmental Plan ("the Hawkesbury LEP"). It contained no definition of the term "brothel", however, it did contain a relevantly identical definition of "commercial premises" to that contained in Walsh. The Court was required to determine whether the rooms for sexual services in a brothel constituted an "office" within the meaning of the term "commercial premises". "Commercial premises" were a prohibited development in the particular zone.

101 Talbot J held (at [20] and [21], emphasis added): [20] The ordinary English … definition of "office" appearing in the recently published Australian Oxford Dictionary as follows: "office 1 a room or building used as a place of business, esp for clerical or administrative work. 2 a room or department or building for a particular kind of business (ticket office; post office). 3 the local centre of a large business (our Adelaide office). 4 US the consulting room of a professional person."

[21] The approach taken by the Council is, in my view, too artificial in the light of the commonly understood association of an office with clerical or administrative work, rather than business in the wider sense of any commercial transaction . This conclusion finds strong support from the dictionary definitions already referred to. 102 His Honour therefore found that (at [23]) [23] The Court is satisfied that, upon a proper construction of the definition of commercial premises as a place used as an office, it does not include a brothel.

The brothel, being an innominate use, was consequently permissible with consent in the zone.

103 I endorse his Honour's construction. Even affording for a liberal interpretation, to construe rooms for provision of sexual services for reward as "commercial offices" would be to strain the ordinary meaning given to the term far in excess of what is "a fair but liberal reading of the rights it confers" (House of Peace at [41] and Romeo v Pittwater (2006) 149 LGERA 107 at [24]) and far in excess of that which is "common sense" (Berry at [34] and Kendall Street Developments Pty Ltd v Byron Shire Council [2004] NSWLEC 227 at [12]). While a brothel may be characterised as a sex worker's place of business and that business may be for reward, and therefore commercial, it would be somewhat surprising (at least to some) if the rooms in a brothel were used predominantly for clerical and/or administrative services. I come to this conclusion absent any recourse to extrinsic interpretative aids and comforted by the dictionary definitions put before the Court by the respondent.

104 Plans or documentation other than those incorporated in a development consent are not generally permitted to be used to interpret the terms of the approval (Auburn Municipal Council v Szabo (1971) 67 LGRA 427 at 434 and Sydney Serviced Apartments Pty Ltd v North Sydney Municipal Council [No 2] (1993) 78 LGERA 404 at 407-408 quoted in Vis Visitor Investment Services Pty Ltd v Hawkesbury City Council [2010] NSWLEC 10 at [50]). However, plans accompanying the development application may be used to interpret the consent where there is an ambiguity contained in the terms of the consent (Hubertus Schuetzenverein Liverpool Rifle Club v Commonwealth of Australia (1994) 85 LGERA 37 at 45-46). 105 The respondent contends that the description of the property as "Rear No 131A Parramatta Road, Homebush" in the 1980 consent gave rise to an ambiguity as to what part of the land was granted approval for use as a car sales yard and therefore it was permissible, if not essential, to look at the plan accompanying the development application to interpret the consent. I agree.

106 An examination of the approved plan accompanying the development consent did not contain any other labels for the large rooms other than "office" or "general office". All other rooms were labelled according to their specific use, such as "storeroom", "bathroom" and "tearoom". The plans therefore corroborate the conclusion that the words "commercial offices", in their ordinary and common sense, do not mean rooms in which sexual services are provided, even if for reward, but rather rooms in which clerical and/or administrative work is carried out for the purposes of a business or a commercial enterprise. Summary 107 In my opinion, the term "commercial offices" construed in accordance with its ordinary and common sense meaning, does not mean rooms used for the provision of sexual services. Accordingly, the actual use of the premises for sexual services for reward is outside the ambit of the development consent and an unlawful purpose under the EPAA. No existing rights can be demonstrated and on this basis alone the appeal may be dismissed.

108 However, if I am wrong, I have considered whether there was continuous use of the premises as a brothel prior to its prohibition.

Second Requirement for Existing Use Rights: Continuous Use As a Brothel Prior to Prohibition 109 The second limb in establishing an existing use right is for the applicant to demonstrate that immediately prior to 21 November 1997, the premises were, pursuant to s 107 of the EPAA, used as a brothel without prior abandonment (Woollahra Municipal Council v Banool Developments Pty Ltd (1973) 129 CLR 138 at 144 and see the discussion in Caltex Australia Petroleum Pty Ltd v Manly Council (No 2) [2007] NSWLEC 350 at [35]-[44] and Hawkesbury City Council v Agostino [2009] NSWLEC 176 at [48]-[56]). As Lloyd J stated in Agostino (at [56]): [56] In my view, the distinction between an intention to " continue a use " and an intention " not to abandon a use ", if any, is a fine one. The same applies to the corollary, the distinction between an intention to " abandon a use " and an intention " not to continue a use ". Whichever approach is adopted, the onus does not fall on the Council to establish that there was abandonment by way of an overt thought process. The onus remains on the Agostinos to establish that there was a continuance of use, or alternatively, that there was no abandonment of use.

110 Thus the applicant must establish that there was a continuance of use, or alternatively, that there was no abandonment of use.

111 The factual background and evidence to these proceedings clearly establish that the premises have been used intermittently as a brothel at various historical points in time since the mid 1980s and continuing on to the present day. Moreover, the evidence discloses that the Council was aware of this likely use.

112 The respondent submitted that the Court should be cautious in finding inferential evidence of continuous use as persuasive. The respondent submitted that absent any direct proof of use on or about 21 November 1997, the Court ought not infer that the premises were used as a brothel. 113 I disagree. Rather, I readily infer from the material put before the Court that on the balance of probabilities from the mid 1980s continuing throughout the 1990s and as at 21 November 1997 the premises were used as a brothel. I draw this inference from the various notes placed on the Council file recording its suspicions in this regard; from the advertisements placed in the local newspaper; from the 1988 police investigation into the use of the premises as a brothel which indicated that Ms Jennifer Barlow, Ms Catherine Mailey and Ms Christine Blake were the same person; from the s 149 certificate issued on 23 February 1996; from the letter to the Council dated 20 October 1999 from Mr Chris Oliver; from the telephone conversation that Mr Lahood had with the Council in October 2003 and from the letter Ms Catherine O'Malley wrote to the Council on 22 January 2004. I further infer that Ms Catherine O'Malley was in fact Ms Catherine Mailey.

114 The applicant has, therefore, in my opinion, discharged its burden of proof that as at 21 November 1997, the use of the premises as a brothel was continuous as required by s 107 of the EPAA. However, because I have found that this use was not lawful in the required sense, the appeal must nevertheless be dismissed. Conclusion 115 For the reasons given above, I find the use of the rooms for the provision of sexual services for reward is contrary to a clerical and/or administrative function permitted in the approval to use the premises as "commercial offices". Consequently, because the use of the premises as a brothel was prohibited at the time of the development approval under Special Uses 3(b) zone of LEP 82, the premises do not benefit from any existing use rights and the applicant is not entitled to the declaration it seeks. Orders 116 The formal orders of the Court are: (1) the application is dismissed;

(2) the applicant to pay the respondent's costs as agreed or assessed; and

05/02/2010 - The words "of the hearing" deleted from Order 2. - Paragraph(s) 116

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.