Norlex Holdings Pty Ltd v Wingecarribee Shire Council

Land and Environment Court (NSW)|2009-11-25|Before: Pepper J, Mr P

Introduction 1 HER HONOUR: These proceedings raise a single question, namely, whether a development consent (DA 057/94) ("the consent") granted by Wingecarribee Shire Council ("the council") to Norlex Holdings Pty Ltd ("Norlex") on 30 August 1995, to permit the collection of spring water extracted under commercial licence ("the licence") from Lot 1 in DP 307664 ("the property"), lapsed on 30 August 2000. 2 On 4 October 2006, Norlex made an application to the council for a construction certificate to enable the extraction of spring water from the property the subject of the consent. On 11 April 2007, the council refused that application on the basis that the consent had already lapsed. 3 Norlex contends that by 30 August 2000 engineering work relating to the development had physically commenced on the land to which the consent applied, with the result that the consent had not lapsed pursuant to s 95(4) of the Environmental Planning and Assessment Act 1979 ("the EPAA"). 4 In my view, Norlex must succeed. The consent has not lapsed because the water analysis and acoustic testing that had been undertaken was engineering work that related to the consent and had been physically commenced on the land to which the consent applied. Factual Background Prior to the Granting of the Consent 5 These facts are uncontroversial. Norlex acquired the property in July 1989. In or about August 1991, Norlex engaged Mr Paul Slade of Slade Drilling to drill a bore in the south western corner of the property. In September 1991 Norlex was granted a perpetual bore licence from the Department of Water Resources ("the Department") for the bore. On 30 June 1992, the Department allowed commercial use of the bore for up to 30 ML per annum of groundwater. In October 1992, Norlex applied for permission to deepen the bore and increase the permitted water extraction to 50 ML per annum. On 13 October 1992, a bore pump was installed. The application was approved by the Department on 20 March 1993. 6 At about the same time the bore pump was installed, the Illawarra County Council completed installation of three phase electricity supply to the property. Norlex then retained licenced contractors to erect and install a power pole and electricity connections on the south western corner of the property. A small shed was erected on the property to cover and secure the bore and equipment. In November 1992, electricians carried out supply, wiring and connections of the pump to the switchboard and control box in the shed. 7 In February 1994, Norlex requested the council to prepare a site specific Local Environmental Plan to permit the extraction and transportation of natural spring water from the site. At the same time Norlex lodged a development application to permit this use. The Consent 8 The council granted conditional development consent on 30 August 1995. 9 The consent was for the purpose of the "collection of spring water extracted under commercial licence - in accordance with plans prepared by Norlex Holdings dated 9 February 1994 except where amended by any conditions below". The consent authorised the erection of a building being a water storage tank and the carrying out of work including landscaping, internal driveways, turning areas, four off-street vehicular parking spaces, road pavement reconstruction and the erection of signage. The consent also authorised the use of the land, the proposed building and proposed work, as well as the existing shed and pump for collection and extraction of spring water. 10 The development consent was subject to the following relevant conditions: 1. In order to maintain the residential amenity of the locality, the extraction and transportation of spring water shall operate in the following manner: (a) Maximum truck movements to and from the site shall be restricted to: five (5) movements per day exiting the site; five (5) movements per day entering the site. (b) All truck movements shall occur between the hours of 9.15am and 3.00pm Mondays to Fridays. No transportation of spring water shall occur outside these hours, nor on weekends or public holidays. (c) In accordance with the provisions of Wingecarribee Local Environmental Plan 1989 (Amendment No 49) no bottling of spring water shall occur on the site, nor shall any direct sales of spring water occur from the site. (d) The applicant shall ensure that all equipment associated with the pumping of spring water is designed and acoustically insulated so that noise emanating from the site will not exceed the existing ambient background noise level measured at the nearest property boundary by more than 5 dBA. (e) …

In order to ensure proper management of the spring water resource, extraction shall at all times comply with the requirements of licence number BL. 150802 as issued by the Department of Water Resources. Further, the extraction of spring water shall only occur whilst a current licence is issued. If for any reason the licence lapses or is not renewed, then the extraction of spring water shall cease.

Details of a water quality monitoring program shall be submitted to Council for approval. Such details are to include the frequency of sampling, parameters to be monitored and methodology of analysis. Events After the Granting of the Consent 11 Again these facts are largely not in dispute. After obtaining the consent Norlex began to market the water to be extracted to potential customers, including Coca-Cola Amatil. 12 In February 1998, Norlex renewed its bore licence from the Department of Land and Water Conservation to extract 50 ML of natural spring water per annum from the property. 13 On a number of occasions Norlex took samples of extracted water from the bore to have it analysed for quality and fitness for drinking. On 23 March 1999, Norlex requested the Australian Government Analytical Laboratories ("AGAL") to analyse spring water samples from the property. On 21 April 1999, AGAL prepared an interim report of analysis of the water samples collected. A final report of analysis was prepared by AGAL on 4 May 1999. 14 In or about May 1999, Norlex advertised in various newspapers inviting potential customers to contact it about the spring water. A number of potential customers responded, including Coca-Cola Amatil. However, the potential customers were unwilling to proceed with negotiations for the sale and purchase of the water because of what were perceived to be restrictive conditions in the consent concerning haulage. In particular, there was concern about conditions 1(a) and (b) of the consent. 15 On 13 July 1999, Norlex attended a development control unit meeting of the council where it discussed making an application to modify these two conditions. Then on 23 July 1999, Norlex met with the council. The council advised Norlex that it would refer the conditions concerning truck movements and hours and days of operation to its monthly meeting for consideration, but it warned that there would be strong objections and possible rejection. It was recommended to Norlex that it should proceed with infrastructure setup, commence operations, adhere strictly to the consent conditions and with the effluxion of time gain acceptance from the residents of Bundanoon, in order to have the conditions amended. 16 On 26 August 1999, the council wrote to Norlex. The letter stated in part: I wish to confirm my advice that Council is unlikely to support a variation of the conditions of consent when the current approval has not been acted upon.

Should your company wish to pursue a request for condition variation, it is recommended that the activity be commenced under the approved conditions in order to demonstrate the actual impact of the use. It is further recommended that following an initial commencement, impacts such as noise and neighbour complaints/concerns should be monitored and recorded.

If it is subsequently decided to pursue a request for condition variation, details of the actual impacts etc., if any, should be supplied with your application. 17 In or around this time, Mrs Brigid Tuite, a director of Norlex, retained Mr Louis Challis, an acoustic engineer, to advise and undertake an acoustic assessment on behalf of Norlex in relation to the development. 18 On 21 October 1999, Norlex lodged an application to modify the consent with the council. 19 In July 2000 the modification application was withdrawn. 20 However, on or about 19 September 2000, a new development application was lodged with the council by Norlex, which included a survey and architectural plans. But in June 2002, following further investigations and discussions with the council, Norlex withdrew the new development application. Legislative Framework 21 Section 95(4) and (5) of the EPAA provides as follows: (4) Development consent for: (a) the erection of a building, or (b) the subdivision of land, or (c) the carrying out of a work, does not lapse if building, engineering or construction work relating to the building, subdivision or work is physically commenced on the land to which the consent applies before the date on which the consent would otherwise lapse under this section. (5) Development consent for development other than that referred to in subsection (4) does not lapse if the use of any land, building or work the subject of that consent is actually commenced before the date on which the consent would otherwise lapse. Issues for Determination 22 In order to succeed in its application, Norlex must demonstrate that:

(a) the consent was for the erection of a building, or the carrying out of a work;

(b) the work relied upon was building, engineering and/or construction work;

(d) the work was physically commenced on the land to which the consent applied before 30 August 2000. 23 There being no contest regarding the first issue, the real issues for determination in these proceedings were three-fold: (a) first, was the work relied on by Norlex building, engineering or construction work; if so

(b) second, did it relate to the consent and not any modification or new development application; and if so

(c) third, was it physically commenced on the property to which the consent applied prior to 30 August 2000. Evidence of Norlex Mr and Mrs Tuite 24 Norlex relied on two affidavits sworn by Mr Laurence Tuite, who with his wife Mrs Brigid Tuite, is a director of Norlex. Mr Tuite swore affidavits on 10 September 2007 and 18 November 2009.

25 In his earlier affidavit, Mr Tuite gave evidence of the steps that Norlex had taken to extract the spring water from the property both prior to and after the granting of the consent by the council. 26 Mr Tuite generally stated that at various times since drilling the bore in August 1991 Norlex had extracted spring water from the bore. This was done in order to run the pump and ensure that it was working properly and in order to obtain water for analysis for quality and fitness for drinking. 27 Mr Tuite specifically stated that on each of his visits to the property, including those in the period between 30 August 1995 and 30 August 2000, he turned on the pump and "ran it for a while" to satisfy himself that it was working properly. Furthermore, on some of these occasions, Mr Tuite stated that he also took samples of the extracted water "to have it analysed for quality and fitness for drinking". 28 Mr Tuite deposed that the water sampling involved the following steps: (a) I would obtain a water sampling/analysis "kit" from a laboratory (for example, Australian Government Analytical Laboratories) that I intended would do the later analysis. The kit typically contained sterile bottles and instructions on the proper procedure for collection, storage and transport of the water;

(d) I would unlock and open the door to the shed and then enter the shed;

(e) I would connect a hose to the tap sticking out of the bore;

(g) I would then switch on and run the pump for at least 30 minutes to flush out sediment and impurities in the bore and connecting hose. The water would discharge from the end of the hose onto the surface of the property and drain away towards Governors Road reserve;

(h) I would then collect samples of the pumped water in the sterile bottles supplied with the kit;

(i) Once filled, I would seal the sterile bottles and placed them in an 'esky' of ice for transport back to the laboratory;

(j) I would then turned off the pump and close the tap valve;

(k) I would disconnect the hose from the tap and leave it outside the shed;

(l) I would then shut and lock the door to the shed;

(m) Then, I would leave the property by shutting and locking the gates; and

(n) Finally, I would deliver the sealed bottles back to the laboratory from which I obtained the kit - typically on the same day as collecting the sample as was required in the kit instructions. 29 Mr Tuite attached a number of documents dated from 9 March 1999 to 4 May 1999, evidencing the analysis by AGAL of water samples collected from the property and tested by it. 30 Mr Tuite recalls that a number of Norlex's potential customers requested copies of the water analysis reports referred to above. He recalled sending letters to those potential customers enclosing copies of the test reports and related documents. These requests occurred throughout 1999. 31 Mr Tuite also deposed that on each visit to the property he would inspect the gates and fencing near the shed. If the fencing or gates were in need of any maintenance or repair, or were damaged in any way, he would personally repair them. 32 Although he could no longer recall the date, Mr Tuite was able to recall repairing the western boundary fence near the shed with the assistance of his friend Mr Calverley. The fence required repair in order to keep the shed as secure as possible because of electrical equipment in the shed that could be stolen or vandalised. 33 Mr Tuite was cross examined about the extent of work involved in repairing the fences around the property. Mr Tuite stated that it consisted of straightening the posts if required and mending any broken wires in order to effect repair. This was done by the use of pliers or some other piece of machinery or tool that Mr Tuite kept in his car. Mr Tuite would use his own strength to straighten any posts. The repairs were ongoing from the time when the pump was installed. The repairs did not, however, extend as far as replacing or moving the fences. 34 In his later affidavit, Mr Tuite stated that on or about 2 November 2009 his wife received an email from the National Measurement Institute (previously AGAL) attaching a quote for the analysis of spring water she had earlier requested. And on 9 November 2009, Mrs Tuite received a bottle kit from NMI which was similar to the bottles in the water sampling/analysis kit previously used by Norlex to test the water. 35 Mrs Brigid Tuite also swore two affidavits in the proceedings. The first on 10 September 2007 and the second on 22 October 2009. 36 In her first affidavit, Mrs Tuite stated that prior to the consent being granted on 30 August 1995, she recalled there were several objections to the development application both by the council and from within the Bundanoon community. In particular, a number of the objections concerned the likely noise generated by the development, especially from water trucks entering and leaving the property. 37 In respect of the extent and details of the work undertaken by Norlex both before and after the development consent was granted described by Mr Tuite in his earlier affidavit, she deposed the following: (a) On each of my visits to the property between August 1995 and August 2000 (approximately 2 to 3 times each year), I would inspect the boundary gates and fencing around the shed which secures the bore and if necessary make arrangements for any maintenance and repair. Recently, in the last few months, the shed has been broken into and damaged, and electrical items stolen from within it. As a result, I arranged for new fencing to be installed along the Governors Road boundary to better secure the property.

(b) On nearly every visit to the property, I would turn on the pump installed in the bore to ensure that it was working properly. The procedure would involve running the pump for at least 10 to 15 minutes during which time spring water would be pumped from the bore.

(d) In October 1999, I lodged with Council an application to modify the development consent granted 30 August 1995 pursuant to section 96(2) of the Environmental Planning and Assessment Act.

(e) In 1999, I retained Mr George Wellings Smith, planning consultant of Design Collaborative Pty Ltd, to advise and assist Norlex in respect of the development consent.

(f) In 1999, I retained Mr Louis A Challis, consulting acoustical engineer of Louis A Challis and Associates Pty Ltd, to advise and undertake acoustical assessments to confirm that the development could be carried out in accordance with conditions of the development consent. 38 Mrs Tuite stated that she recalled that most of the potential customers which Norlex had dealt with after the granting of the consent were unwilling to proceed with any commercial discussions because of conditions 1(a) and (b) attached to the consent. Accordingly, during 1999 Mrs Tuite was involved in negotiations with the council concerning those conditions. It was Mrs Tuite's evidence that the council advised her during these discussions to lodge a modification application under s 96 of the EPAA to amend conditions 1(a) and (b). A letter to this effect was sent by the council on 15 July 1999. 39 Therefore, on 21 October 1999 she lodged on behalf of Norlex an application to modify the development consent. The application sought a second access route for truck movements to and from the property and an increase in the permitted hours and days for the truck movements. 40 By letter dated 2 November 1999, the council requested a statement of environmental effects and a report by an acoustic engineer in respect of the modification application. Accordingly, in or about July 1999 Mrs Tuite retained Mr Louis Challis of Louis A Challis & Associates to advise and undertake an acoustical assessment of the development on behalf of Norlex. Mr Challis' brief included an assessment by him of Norlex's compliance with condition 1(d) of the development consent. 41 Shortly after his retainer, in or about August or September 1999 (Mrs Tuite was not clear when he had been engaged by her), Mrs Tuite accompanied Mr Challis to the property. On that occasion, she recalled switching on the pump at his request, following which she observed him undertaking noise measurements. Mrs Tuite recalled that after taking the measurements Mr Challis told her that according to his readings, there was an insignificant increase in noise after activating the bore pump and that the noise complied with the conditions of the consent. 42 On 25 November 1999, Mrs Tuite again met with Mr Challis and one of his assistants. On that occasion, she observed Mr Challis installing noise monitoring equipment to measure and record noise levels at various locations in the vicinity of the bore on the property for his report. On 17 December 1999, Mr Tuite received Mr Challis' report. 43 Mrs Tuite stated that by late 1999 she had also retained Mr George Smith, a planning consultant with Design Collaborative Pty Ltd ("Design Collaborative"), to advise and assist Norlex in respect of the development. Mr Smith advised Mr and Mrs Tuite in or about mid December 1999 to withdraw the application to modify the development consent and to lodge a new development application in respect of the whole project. This advice was followed and Norlex withdrew the modification application in July 2000. 44 Pursuant to Mr Smith's advice, Mr Challis undertook further acoustical engineering work in early and mid 2000. 45 In her second affidavit, Mrs Tuite stated that she had reviewed her travel records for 1999 and was in Ireland between 28 August and 12 September 1999 and between 5 and 15 November 1999. 46 Mrs Tuite deposed that on 26 August 1999, Mr Michael O'Donohoe, on behalf of Norlex, discussed Norlex's proposal to amend the development consent with the council. The response from council was the letter to Norlex dated 26 August 1999. 47 Mrs Tuite initially stated that she recalled receiving a copy of that letter on or about the date it was sent. 48 Mrs Tuite stated that to the best of her recollection she retained Mr Challis shortly prior to her trip to Ireland on 28 August 1999. 49 Under cross examination Mrs Tuite conceded that one of the reasons why Norlex had had the water tested was because Norlex wanted to ensure that it could provide customers to whom the water was being marketed with recent information as to its quality. Mrs Tuite stated that "the purpose of our ongoing testing was always to ensure that the quality of the water was good enough for it to be marketed". 50 Mrs Tuite also agreed that the maintenance and repairs done to the fencing had been ongoing from 1992 and continued whenever necessary. Mrs Tuite stated that the fencing that had been replaced along the southern boundary of the property had been installed sometime in 2007. Furthermore, it was not, it could be inferred, Mrs Tuite who physically did the maintenance or repair, rather she arranged for others to carry out this work. 51 It was put to Mrs Tuite that Norlex did not intend to act upon the existing consent because it intended instead to modify it. Mrs Tuite repeatedly denied this and said that in relation to the consent, "we always got up and got going from 30 August 1995." She specifically denied that any efforts which were made by Norlex in 1999 were directed either to the modification application or to the new development application. By way of illustration, Mrs Tuite stated that she and Mr Challis went to the property after her return from Ireland only in response to the receipt of the letter from the council dated 26 August 1999, and in particular, to ensure that Norlex complied with condition 1(d) of the consent. 52 However, Mrs Tuite conceded that little else was done to get the consent "up and going". That is to say, no s 94 fees were paid, no plans were lodged, no landscaping was carried out, the works and services specified in the consent requiring completion had not commenced, signs had not been erected and the payment of levies had not been made. Mrs Tuite stated that these were matters that were to be attended to only upon Norlex securing a contract for the sale and purchase of the water. 53 When asked why it was that only condition 1(d) of the consent had been acted upon Mrs Tuite responded that Norlex had been "acting on that consent at all times". 54 Mrs Tuite conceded that there was no reference whatsoever in any correspondence that Norlex sent to the council concerning compliance with condition 1(d) of the consent. Mrs Tuite also conceded that the application to modify the consent was made because "we would have liked extra hours to make it economically viable for us to earn". 55 Mrs Tuite agreed that on 24 May 2000, Mr George Smith, who had been engaged by Norlex, wrote to Mr Challis stating that "the existing consent expires at the end of August". Mrs Tuite somewhat implausibly, in my view, stated that she did not challenge this opinion because she believed he was incorrect. This was so notwithstanding the fact that Mr Smith had written in the statement of environmental effects (dated September 2000) in support of the new development application prepared for Norlex, that the consent had "just expired". It was therefore put to Mrs Tuite that the real reason why Mr Challis was engaged was in order to provide a report by an acoustic engineer in respect of the new development application. Mrs Tuite refuted this suggestion. Mr Louis Challis 56 Mr Louis Challis, a consulting acoustical engineer, affirmed two affidavits in the proceedings. In his first affidavit sworn 29 August 2007, he stated that during the past decade he had been retained by Norlex to assist in various projects in which it had involvement. However, in early 2007 a large number of old stored files were destroyed during the course of a move to a smaller office, including files relating to Norlex and the development the subject of these proceedings. 57 Mr Challis states that in or about July or August 1999, he had a meeting with Mr and Mrs Tuite and recalls Mrs Tuite saying to him that Norlex would like to retain him to assess and advise Norlex on the acoustical requirements imposed by council "as part of the Development Consent for Norlex project at Bundanoon". His brief included an assessment of Norlex's compliance with condition 1(d) of the consent. 58 Mr Challis states that he recalls visiting the Norlex property on four occasions: (a) the first trip was in or about August (under cross examination he later revised this to September) 1999 when he visited the property with one of his staff in the company of Mrs Tuite in order to identify where people lived in relation to the property and the topography of the property and its surrounds. He wanted to understand the proximity of the entrance road to nearby residences so that he could plan the form and structure of a comprehensive noise assessment of the proposed development. On that occasion, he conducted a series of preliminary noise measurements on the operating pump and those measurements confirmed that the noise level in the immediate vicinity of the well head with the pump operating produced an insignificant increase in the background noise level;

(b) the second trip took place on 25 November 1999. Mr Challis travelled to the property with Mr David Wilson, his senior technical officer, and together they placed four computerised noise logging systems to record the statistical characteristics of the prevailing background and foreground noise levels at multiple sites in Bundanoon in the vicinity of the spring water bore;

(c) the third trip took place on 3 December 1999. Mr Challis returned to the property in order to collect equipment and data discs that were required to produce a graphical output in conformity with the standard data processing procedures for the preparation of his report, which was submitted in December 1999; and

(d) the fourth occasion was in or about January 2000, when he investigated the feasibility of selecting an alternate travel route from the property for any haulage trucks that might better address concerns that he understood were being raised by the council to the selected haulage route. 59 In his second affidavit sworn on 21 October 2009, Mr Challis stated that he recalled being given a copy of the development consent and Mrs Tuite specifically saying to him "Louis, can you look at Clause 1(d). Please read it and tell us what we have to do to comply with the consent". The affidavit also attached various correspondence to and from Norlex and Design Collaborative dated between 24 November 1999 and 24 May 2000, concerning the development. 60 Prior to his departure on his first trip to the property, Mr Challis prepared a case that held his sound and portable vibration measurement equipment. He packed a portable reference source and a vibration device. He packed prepared data recording sheets on which the results of his measurements were to be recorded. He also packed his camera for recording relevant images, together with an ultra-sonic distance measurement device. 61 Once at the property he walked along the western boundary and aligned himself with the pump and shed to his east and the nearest residents to his west. He then measured the background sound level in order to determine the weighted background sound level and the octave band background sound levels. He did this using a sound level meter and another handheld instrument. He recorded the results on data sheets at approximately 15 second intervals, in typical mean minima sound pressure levels. As a result of his observations, he formed the opinion that the measurements that he had recorded would be typical of the quietest conditions that he would be likely to find at that location. The pump was then turned on by Mrs Tuite. He returned to where he had previously stood and continued to take noise level measurements. He did so with the pump operating for approximately five minutes. He then told Mrs Tuite that she could easily satisfy condition 1(d) of the consent. 62 He used his ultra sonic distance measuring equipment to measure key distances such as the position of the western boundary relative to the shed enclosing the well head. He also used it to measure the distance from the southern boundary to the shed. He walked over the land extensively in the south-western corner of the property. He took a series of photographs of the shed, the pump's well head and of the boundary position where he had made his measurements. He then walked along the western boundary in a northerly direction for about a hundred metres because he wanted to identify if there were any further residential properties that might potentially be disturbed by the development. 63 Mr Challis' second trip to Bundanoon was necessitated by the need to determine the acoustical environment in the streets of Bundanoon through which tanker trucks would be required to travel to the property. This was because, he stated, the development consent granted to Norlex permitted truck traffic movements between limited hours which were an impediment to satisfactory commercial arrangements being entered into in respect of the development. 64 He used his second trip to confirm the short term measurements that he had taken during his first trip. The long term noise measurement equipment employed at the time was based on a series of conventional XT computers, each one of which incorporated a special digital sound level meter card, supplemented by a microphone on an extended external screened cable together with a windscreen that were all connected to the sound logger. Utilising software the sound loggers provided data which facilitated subsequent graphical data presentation. With an assistant, Mr Challis prepared and pre-programmed four computerised noise logging systems prior to departing for the property on 25 November 1999. Three noise loggers were placed by Mr Challis at various locations in Bundanoon. None were placed on the property. This was because the relevant Australian standards and guidelines specified that the background noise measurements should be performed at the nearest potentially affected residents or at the closest site boundary for each resident. Mr Challis stated that he had obtained all of the information he required from the property on his first visit to it. 65 On his third trip, he returned to Bundanoon to collect the noise logging equipment and their data discs. He recalls briefly visiting the entrance to the Norlex property and conducting some supplementary measurements but he could not recall re-entering the property on that visit. 66 The fourth visit to the property was occasioned from a request by Mr George Smith to revisit the property and undertake an investigation in order to identify an alternative travel route that would address the problems that the council had raised regarding truck traffic along the proposed haulage route. During that trip Mr Challis conducted a visual inspection of the north-western corner of the Norlex property. 67 Mr Challis prepared a draft report for Norlex dated 17 December 1999 on the acoustic implications of the proposed modified hours of operations. In that report he expressed the view that in order to operate within the hours imposed by the consent either an acoustic wall needed to be built or Norlex needed to achieve appropriate noise attenuation. He also suggested buying a nearby residence known as 'Jackman's Lodge'. The report did not address condition 1(d) of the consent. 68 Under cross examination Mr Challis confirmed that the reason for attending the property in September 1999 was to confirm compliance with condition 1(d) of the consent. Mr Challis stated that he did not know that Norlex was intending to lodge a modification application at the time of his first visit to the property. 69 Mr Challis readily accepted that in none of the correspondence he had seen in relation to his attendance at the property in September 1999 was there any reference to the taking of background readings to confirm compliance with condition 1(d). There was, however, general reference to the s 96 modification application. This included buying Jackman's Lodge and the acoustic fences that might be required if the truck movements were increased. 70 Mr Tuite conceded that one of the reasons for visiting the property in September 1999 was to do a comprehensive noise impact statement for Norlex and not exclusively to ensure compliance with the conditions of consent. Mr Challis stated that it was not until around December 1999 or January 2000 that he became aware that Mr and Mrs Tuite were seeking to modify the existing consent or obtain a new consent in order to accommodate any prospective clients who required longer operating hours and additional truck movements. 71 Mr Challis stated that when he had made the statement that Norlex could easily satisfy condition 1(d) of the consent (because it was not exceeding background noise by more than 3 dBA), this statement was made solely in relation to the noise generated by the pump. Other evidence 72 Norlex also relied on affidavits sworn by Mr Ciaran Tuite on 11 September 2007 and 1 October 2009. From the affidavits the following facts were revealed: (a) that Mr Ciaran Tuite went to the property on perhaps 20 occasions between 1994 and 1996, four or five of which were after August 1995. He recalled turning on the pump to make sure it worked and checking the clarity of the water. He would also inspect and check the property, fences and gates for any damage or vandalism on those occasions; and

(b) Mr Ciaran Tuite recalled assisting Norlex after the council granted its development consent on 30 August 1995, to source potential customers for the extraction of the spring water from the property, including the forwarding of details and/or copies of the licence and water analysis reports. 73 Mr Arthur Calverley swore an affidavit on behalf of Norlex on 10 September 2007. In his affidavit he deposed that between 1997 and 2000 he attended the property and whilst there regularly: (a) inspected the shed, which housed the bore and other equipment;

(b) inspected, maintained and repaired the gates and/or fencing as necessary; and

(c) collected, or helped collect, water samples from the bore for quality testing and analysis by use of samples/analysis kits. 74 Mr George Smith, a director of Design Collaborative, planning and development consultants engaged by Norlex, affirmed an affidavit on 23 October 2009. In the affidavit he referred to various prior statements by him where he had expressed the view that the consent had either expired or was about to expire. He stated that these statements were made on the basis that it was his understanding from instructions given to him by Norlex that no buildings had been constructed on the land after the date of the consent and that the shed and pump facilities had been installed prior to 30 August 1995. He went on to state that, in his opinion, this understanding, based as it was on instructions, was erroneous in light of the decision in Hunter Development Brokerage Pty Limited v Cessnock City Council; Tovedale Pty Ltd v Shoalhaven City Council (2005) 63 NSWLR 124. Prior to this decision Mr Smith had understood that the work undertaken had to be substantial in nature. 75 Furthermore, when Mr Smith made the statements referred to above concerning the expiring of the consent he was unaware that: (a) Mr Tuite had taken samples of water from the bore and submitted them for analysis between 1995 and 1999; and

(b) Mr Louis Challis had been retained to undertake acoustic testing and had attended the site in or about August or September 1999 to perform that testing.

Was the Work Relied On by Norlex "Building, Construction or Engineering Work" That Was Physically Commenced On the Land to Which the Consent Applied? 76 It is convenient to deal with the first and third issues for determination together.

77 Norlex relied on the following "building, engineering or construction work", all of which, it submitted, was physically commenced on the land (the property) to which the consent applied: (a) the testing for water quality and fitness for purpose carried out after 30 August 1995 was engineering work;

(b) the acoustic work performed by Mr Challis in at least September 1999 was engineering work; and

(c) the fence and gate repair and maintenance was building and/or construction work. 78 In Hunter Development it was held that preliminary work done in furtherance of a development can constitute physical commencement for the purpose of s 95(4) of the EPAA. After reviewing the existing authorities, Tobias JA (with whom Santo JA and Stein AJA agreed at [1] and [131] respectively) stated (at [83]-[86]): 83 In my opinion, the expression "engineering work" in its context of forming part of the composite phrase "building, engineering or construction work", should be given a broad meaning to include all those activities associated with, and forming a necessary part of, the discipline of engineering applicable to the subdivision of land. There can be no doubt that engineering as such can involve many different elements: relevantly with respect to a subdivision, it involves civil engineering work such as the design and (possibly) the construction of roads, sewerage systems, drainage and the like.

84 But once consent is granted for a subdivision, the implementation of that consent ultimately resulting in the construction of the subdivision roads, drainage and sewer lines as well as the laying out of the allotments in accordance with the approved layout, requires as a necessary first step in the engineering or construction of that subdivision, including the physical works contemplated thereby, the setting out by survey upon the land of each of the component elements of the subdivision in accordance with the approved plan. This would accord with common sense and industry practice (as to which see at 128 [13] supra).

85 The carrying out of survey work to establish the correct location of these elements, in my opinion, is capable of constituting a first step in the performance of the engineering and/or construction work involved in the creation of a subdivision. Accordingly, it follows that the natural and ordinary meaning of the expression "engineering work" in the context relevant to the present issue is capable of including physical survey work of the nature and extent of that the subject of these appeals.

86 That is not to say that any survey work, albeit of a physical nature, would so qualify. Simply entering land in respect of which a subdivision has been approved and knocking in one or two pegs would not, in my view, necessarily qualify. There is an element of fact and degree in each case. Although in Besmaw Pty Ltd , Talbot J (at 436 [112]) observed that once Parliament had decided to delete the requirement of substantiality, there was little room for an argument that the works must not be de minimus, and that it was therefore reasonable to exclude any test of the degree and extent of the work under the present statutory regime, nonetheless the requirement that the relevant work relate to the approved subdivision requires a real nexus between them. In particular, the concept that the work must be "physically commenced", requires physical activity which involves an appearance of reality and which is not merely a sham. In other words, the relevant work must be more than merely notional or equivocal in that it must truly be work relating in a real sense to that which has been approved: cf Besmaw Pty Ltd (at 436 [111]). 79 In relation to what preparatory work constituted "engineering" work for the purposes of the provision the Court said ([97]-[98]):

97 I set out a passage from the judgment of Giles JA in Green (at 141 [78] supra), which is, as I observed (at 141 [79] supra), of relevance to the present issue.

98 The point to be taken from the emphasised part of that passage is that the erection of a dwelling begins with clearing of the site followed by its pegging out and then the digging of trenches for footings. It must logically follow that the erection commences with the first of those items. It matters not that neither the clearing of the site, its pegging out nor the digging of trenches involves the actual erection of the fabric of the building. So in the present cases, once it is accepted that the survey and geotechnical investigation work that was carried out was "engineering work", it must follow that that work, in the context of a development consent to a subdivision was, to adopt the words of McTiernan J in Owendale Pty Ltd , "an initiatory step" in the process of subdividing the relevant land in accordance with that consent. Provided that "initiatory step" is a necessary part of that process that is all the statutory provisions require. Accordingly, whether one describes that step as preparatory is irrelevant. 80 Accordingly, in Hunter Development it was held that the clearing of bush and pegging for the purpose of survey work was "building, engineering or construction work". So too was geotechnical investigation work undertaken for the purpose of enabling design, engineering and survey plans to be prepared. This work comprised the excavation of test pits and the collection of soil samples for the purpose of laboratory tests, the results of which were used for the purpose of enabling the preparation of engineering plans and specifications.

81 Hunter Developments was applied by Biscoe J in Zaymill Pty Ltd v Ryde City Council [2009] NSWLEC 86 (at [12]) to hold that a development consent approving the construction of thirty-two dwellings had not lapsed where significant quantities from the development site of soil were excavated and analysed and investigations were undertaken pursuant to a remediation and validation report required to be lodged with the council as a condition of the consent.

82 In JMS Capital Pty Limited v Tweed Shire Council [2006] NSWLEC 535 Lloyd J held that survey work which included the pegging of a site constituted engineering work (at [22]).

83 In Henry v Shellharbour City Council [2005] NSWLEC 378 Talbot J held that a pilot study comprising a survey and significant physical works was engineering and construction work relating to the establishment of an approved compensatory wetland development for the purpose of s 95(4) of the EPAA (at [33]-[34]).

84 The council submitted that all of the "work" relied upon by Norlex for the purpose of s 95(4) of the EPAA was irrelevant because it did not relate to, or was not otherwise part of, the work the subject of the consent. While the council accepted that an initiatory step can be characterised as relating to the approved activity this step had to be directed to the ultimate purpose, use or operation of the consent and not some other purpose, use or operation. Thus the work had to be an identifiable step in giving effect to the consent. the fence and gate repair was not "work" 85 In my opinion, the fence and gate repair was not building, engineering or construction work because both having been installed well before the granting of the consent, their maintenance was neither required for, nor related to, the carrying out of the approved work the subject of the consent. This conclusion was reinforced by the random and minimalist nature of the repairs in question. the extraction, testing and analysis of the spring water was "engineering" work 86 Norlex submitted that the testing of water for quality and fitness for purpose required the collection of water samples and delivery to AGAL for analysis and was, therefore, "engineering work" in the relevant sense. In addition, the taking of the water samples was a step in that process and properly characterised was similarly "engineering work". The work related to conditions 2 and 3 of the consent. It was, moreover, sufficient that the collection of the samples took place on the land the subject of the consent.

87 While the council did not cavil with the proposition that scientific analysis can involve the application of engineering skills, it rejected the argument that the collection and analysis of the spring water was "engineering work" because, first, the collection of the water samples was not undertaken by an engineer or scientist. Second, the analysis, which may have constituted engineering work, was not physically commenced upon the land. Third, the acts relied upon, namely, the pumping of the water and the filling up of the sample bottles, could not be classified as the application of science in its own right which was necessary for the work to constitute "engineering" work. And fourth, in truth the water was, as was conceded by Mrs Tuite in cross examination, collected and analysed for the purpose of marketing and product promotion.

88 I accept the council's final submission that the collection of water solely for the purpose of marketing could not be classified as engineering work for the purpose of s 95(4). However, such a characterisation cannot, in my opinion, be exclusively applied to the collection of the spring water in the circumstances of this case. 89 Turning to the words of the consent, approval was given for use of the property for the "collection of spring water extracted under commercial licence". In addition, any extraction had to comply with the licence as mandated by condition 2 of the consent and comply with condition 3 of the consent. This was the work which the consent permitted to be carried out. In order to achieve compliance, the spring water had to be extracted and analysed. On any view, therefore, the extraction and analysis of the water related to the work to be performed under the consent, albeit as an "initiatory step" (Hunter Developments at [98]). 90 While a purpose in testing the spring water was for use in marketing, the fact remains that in order to give effect to the consent the water extraction was required to be, for example, in compliance with the licence which specified the necessary fitness for purpose. Provided the spring water was analysed by AGAL for a purpose which included compliance with the conditions of the consent, this was sufficient. That the testing fulfilled some other purpose as well did not, in my opinion, in the circumstances of this case matter.

91 A question remains, however, as to whether or not the work was physically commenced on the land. In Hunter Developments the notion that the work had to result in a material alteration to the physical nature of the land was rejected (at [88]). All that was necessary was that the work was physically commenced on the property and was not commenced "off-site" (at [88]). Thus in Hunter Developments and Zaymill, the excavation and testing of the soil samples was engineering work that had been physically commenced on the land notwithstanding that the soil was analysed elsewhere. The excavation of the soil samples and their subsequent testing was a necessary step in the satisfaction of the conditions of the consent.

92 I am unable to meaningfully distinguish between, in the present case, the extraction of the spring water by use of the pump and its bottling for subsequent laboratory analysis, and the excavation of the soil samples for external testing in Zaymill. In both the work was commenced on the land and was a necessary step in the process of carrying out the consent.

93 But was the actual operation of the pump to extract the water for scientific analysis "engineering" work? In Hunter the term "engineering" work was broadly construed "to include all those activities associated with and forming a necessary part of, the discipline of engineering applicable to" (at [83]) the carrying out of a work. In the present case this means the extraction of the spring water. In Hunter Tobias JA rejected a submission to the effect that what was required was "some action or work of a civil, mechanical or structural nature required to be performed on the relevant land" (at [76] and [80]). All that was required was, "the application of labour which manifests itself on the land" (at 87]). As the evidence of Mr Tuite and Mr Calverly demonstrated, a degree of effort was involved in collecting the water samples. Certainly more was required than the mere "flicking of a switch" as was suggested by the council. In my opinion, the work involved was sufficiently labour intensive to constitute "engineering" work.

94 Does it matter that the pumping was not, on the evidence, undertaken by professional engineers? In my view it does not because the activity of pumping the water was one in furtherance of engineering. The construction of a deck is no less building or construction work merely because the hammering of the nails into the wood is undertaken by a judicial officer, rather than a qualified builder or carpenter.

95 Accordingly, the collection, testing and analysis of the spring water was "engineering" work which had, for the purposes of s 95(4), physically commenced on the land, insofar as the water was pumped and collected on the property to which the consent applied.

96 There can be no doubt, as was eventually conceded by the council in its closing oral submissions, that the acoustic work performed by Mr Challis on the property in September 1999 was "engineering" work as that term has been expansively interpreted. There can also be no doubt, in my opinion, that the "work" was physically commenced on the land to which the consent applied and that it had a sufficient nexus to the subject matter of the consent, in particular to condition 1(d). In so concluding, I find that Mr Challis first visited the property in or about September 1999, notwithstanding the absence of any documentary corroboration (such as an invoice) to this effect.

97 Mr Challis is a consultant acoustic engineer with specialised expertise and qualifications. The evidence overwhelmingly demonstrates that he was required to use these specialist skills in the assessment that he undertook on the property during his first visit.

98 In any event, the assessment was sufficiently analogous to the surveying work that was undertaken in Hunter Developments and JMS that it clearly constituted "engineering" work.

99 The council submitted that the taking of readings was not a relevant "manifestation" of physical activity commenced on the land. But that is not what is required. As discussed above, a material alteration to the physical nature of the land is not required. Indeed the extent to which there must be any alteration to the physical nature of the land is questionable given that most alterations to the land would constitute either "building" or "construction" work in the context of s 95(4) of the EPAA thereby leaving little room for the concept of "engineering" work. What must be demonstrated is that the engineering activity physically occurred on the property and not at some other location, such as the work undertaken on 25 November 1999 in Bundanoon. Mr Challis' evidence of what he did when he got to the property, the measurements he took and the analysis he made, amply demonstrates that this is what occurred. 100 I therefore find that the work relied on by Norlex was "building, engineering or construction work" which commenced on the property for the purpose of s 95(4) of the EPAA. Did the Work Relate to the Work the Subject of the Consent? 101 The council submitted that s 95(4) is concerned with forms of work and development that involve physical undertaking or endeavour and not the use or operation of those forms of development. The latter, it argued, is the exclusive domain of s 95(5) which is mutually exclusive from sub-section (4) (Sharp v Hunters Hill (2002) 120 LGERA 155 at [41]-[42]). Thus Norlex could not, as it had sought to do in respect of the testing of the spring water and the acoustic analysis of the noise emissions from the pump, rely on the operational commencement of the consent without first carrying out physical commencement (True Item Pty Limited v Baulkham Hills Shire Council [1996] NSWLEC 155 at 6-7). 102 Caution must be demonstrated when relying on authorities such as True Item that not only pre-date Hunter Developments, but which also pre-date the enactment of s 95(4) of the EPAA. In any event, I do not accept the council's submission in this regard. As the terms of the present consent indicate, the consent is for the carrying out of "a work", namely, the commercial extraction of spring water and the subsequent use of the land in accordance with that approved work (s 95(4)(c)). It was not for the erection of a building or the subdivision of land. Because the consent was for "a work", in my opinion, there existed a sufficient nexus between the so-called "operational" steps taken by Norlex and the subject matter of the consent. Where consent is granted for "a work" there is likely to be an intimate connection, if not an intertwining, between the "building, engineering or construction work relating to the...work" and the operational use of the land itself. Artificial and narrow distinctions between the two processes such as those relied upon by the council are unhelpful and apt to confuse. 103 As a consequence, whether or not the shed or pump was approved as part of the consent was irrelevant for present purposes. This is because it was a condition of the consent that the noise emissions of the approved work were not to exceed prescribed limits (condition 1(d)), the work was only to occur whilst a licence was currently issued and the details of the water quality monitoring program of the work had to be submitted to the council for approval, including the methodology of analysis. Thus to the extent that, for example, the acoustic work was performed on the operation of the pump it nevertheless related to the work approved by the consent. 104 The council additionally submitted that the work performed by Norlex was undertaken not in relation to the consent but was directed to either the modification application or the new development application. I have therefore scrutinized each of the works relied upon by Norlex in light of this claim. 105 The council relied on the evidence of Mr Smith in support of this contention. However, I did not find the evidence of Mr Smith to be of assistance. Ultimately what was material were the matters within the contemplation of Norlex, as evidenced by its directing mind comprised of Mr and Mrs Tuite. pumping, testing and analysis of the spring water 106 Given the terms of the consent, in my view, the pumping, testing and analysis of the spring water was work that related to the subject of the consent, namely, the extraction of spring water under commercial licence, and not the modification application or the new development application. The evidence of Mr and Mrs Tuite, which was not challenged in this regard, revealed that the collection and analysis of the water by AGAL occurred prior to the lodging of either the modification application or the new development application and, it may be inferred, before either were contemplated. acoustic testing 107 While I found the oral evidence of Mrs Tuite to be on occasion unresponsive and evasive, I nevertheless accept that the reason Mr Challis was engaged by her to go to the property in September 1999 was predominantly to ensure that the development complied with condition 1(d) of the consent and not to conduct acoustic testing in furtherance of the modification application or the new development application. I am reinforced in this conclusion by the terms of the letter from the council dated 26 August 1999, the independent evidence of Mr Challis who confirmed that this was the purpose of his visit and by similar evidence from Mr Tuite who was not cross examined to the contrary. I make this finding irrespective of the fact that the correspondence sent to Mr Challis made no reference to condition 1(d) and that Mr Challis' December report was similarly silent. 108 It is possible that in engaging Mr Challis Mrs Tuite's purpose was two-fold: first, to confirm that the conditions of the consent were being complied with in light of the advice given by the council that Norlex should ensure compliance in order to convince the community of the merits of the development. And second, to investigate the feasibility of lodging a modification application or a new development application in order to obtain more favourable haulage hours to enhance the commercial viability of the development. Provided a purpose was to conform with the conditions of the consent then the acoustic work satisfied the terms of s 95(4) of the EPAA. 109 Having determined that the acoustic work related to the work the subject of the consent it is unnecessary for me to decide whether if the work was only directed to the modification application it was sufficient. Given that the consent as modified was nonetheless the same development consent for the purpose of s 95(4) of the EPAA, I would have accepted the submissions of Norlex on this issue. Conclusion and Costs 110 It follows from the reasons above that Norlex's application has succeeded and the declaratory relief sought ought to be made.

111 Norlex has also sought that its costs be paid on an indemnity basis. This issue was not argued before me and no evidence was put before the Court that could justify such an order being made. I therefore propose not to presently make the order but will afford Norlex the opportunity of making an indemnity costs application should it elect to pursue such a costs order.

Orders 112 The orders of the Court are therefore: (1) the Court declares that the development consent (DA 057/94) granted by the council for the extraction of groundwater on the property and notified pursuant to the provisions of the EPAA on 30 August 1995, has not lapsed; (2) the costs of the proceedings are reserved. If, however, within 7 days Norlex has not filed a notice of motion seeking indemnity costs, then the council is to pay Norlex's costs of the proceedings; and (3) the exhibits are to be returned. **********

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

CITATION : Norlex Holdings Pty Ltd v Wingecarribee Shire Council [2010] NSWLEC 149

Henry v Shellharbour City Council [2005] NSWLEC 378 Hunter Development Brokerage Pty Ltd v Cessnock City Council; Tovedale Pty Ltd v Shoalhaven City Council [2005] NSWCA 169; (2005) 63 NSWLR 124 CASES CITED: JMS Capital Pty Limited v Tweed Shire Council [2006] NSWLEC 535 Sharp v Hunters Hill [2002] NSWLEC 27; (2002) 120 LGERA 155 True Item Pty Limited v Baulkham Hills Shire Council [1996] NSWLEC 155 Zaymill Pty Ltd v Ryde City Council [2009] NSWLEC 86

(2002) 120 LGERA 155

At a glance

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Cases Cited (9)

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